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EXHIBIT 10.5
AVANEX CORPORATION
FOUNDER'S STOCK PURCHASE AGREEMENT
THIS AGREEMENT is made as of January 13, 1998, by and between Avanex
Corporation, a California corporation (the "COMPANY"), and Simon Xxxxxxx Xxx
(the "PURCHASER").
Whereas, Purchaser possesses certain Technology (as defined below) related
to the business of the Company which the Company's Board of Directors has
determined to have a value of $800.00.
Whereas, Purchaser and the Company desire to assign the Technology to the
Company in consideration for the sale and issuance of shares of the Company's
common stock (as described below), and to sell additional shares of the
Company's common stock to Purchaser.
The parties agree as follows:
1. Sale of Stock. The Company hereby agrees to sell to the Purchaser and
the Purchaser hereby agrees to purchase an aggregate of 1,800,000 shares of the
Company's Common Stock, no par value (the "SHARES") at a price of $0.001 per
share for an aggregate purchase price of $1,000.00, plus the assignment of all
of Purchaser's right, title and interest in and to the Technology as described
in Section 13 hereof.
2. Payment of Purchase Price. The payment of the purchase price shall be
by either cash, check, promissory notes payable to the Company, or an
assignment of all right, title and interest in certain property by Purchaser
to the company as provided in that certain Assignment of Proprietary Rights
between the Company and the Purchaser of even date herewith, or any combination
of these.
3. Repurchase Option. In the event of any voluntary or involuntary
termination of the Purchaser's employment by, or services to, the Company for
any or no reason (including death or disability) before all of the Shares are
released from the Company's Repurchase Option (as defined below in Section 4),
the Company shall, upon the date of such termination (as reasonably fixed and
determined by the Company), have an irrevocable, exclusive option, but not the
obligation, for a period of 90 days from such date to repurchase all or any
portion of the Unreleased Shares (as defined below in Section 4) at such time
at the original purchase price per share (the "REPURCHASE PRICE"). The
Repurchase Option shall be exercisable by the Company by written notice to the
Purchaser or the Purchaser's executor (with a copy to the Escrow Agent, as
defined below in Section 6) and shall be exercisable, at the company's option,
(i) by delivery to the Purchaser or the Purchaser's executor with such notice
of a check in the amount of the purchase price for the Shares being
repurchased, or (ii) by cancellation by the Company of an amount of the
Purchaser's indebtedness, if any, to the Company equal to the purchase price
for the Shares being repurchased, or (iii) by a combination of (i) and (ii) so
that the combined payment and cancellation of indebtedness equals the
Repurchased Price times the number of shares to be repurchased (the "AGGREGATE
REPURCHASE PRICE"). Upon delivery of such notice and the payment of the
Aggregate Repurchase Price in any of the ways described above, the Company
shall become the legal and beneficial owner of the Shares being repurchased and
all rights and interests therein or relating thereto, and the Company shall
have the right to retain and transfer to its own name the number of Shares
being repurchased by the Company. The Repurchase Option set forth in this
Section may be assigned by the Company in whole or in part in its sole and
unfettered discretion.
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4. Release of Shares from Repurchase Option.
(a) As of the date of this Agreement, all of the Shares shall be
subject to the Company's repurchase option (the "REPURCHASE OPTION"). The
Shares shall be released from the Repurchase Option as follows:
(i) One quarter (1/4) of the Shares shall be released from the
Repurchase Option on January 13, 1999; and
(ii) One forty-eighth (1/48) shall be released from the
Repurchase Option each full calendar month elapsing thereafter during all of
which Purchaser was a full time employee of the Company.
(b) Any of the Shares which, from time to time, have not yet been
released from the Repurchase Option are referred to herein as "UNRELEASED
SHARES".
(c) The Shares which have been released from the Repurchase Option
shall be delivered to the Purchaser at the Purchaser's request.
(d) Notwithstanding the foregoing, upon a Change of Control, as
defined below, for any reason that occurs while Purchaser is an employee of the
Company, that number of Unreleased Shares, if any, which, when aggregated with
any Shares previously released from the Repurchase Option, are required to equal
fifty percent (50%) of the Shares shall be released from the Repurchase Option
on the date the event constituting a Change of Control is consummated. The
balance of the Shares subject to the Repurchase Option shall continue to be
released form the Repurchase Option on the same schedule as existed prior to the
Change of Control. For example, if a Change of Control occurs on a date where
25% of Purchaser's Shares have been released from the Company's Purchase Option,
then an additional 25% of the Shares shall be released from the Purchase Option
pursuant hereto. If a Change of Control occurs on a date where more than 50% of
Purchaser's Shares have already been released from the Company's Purchase
Option, then no additional Shares shall be released from the Purchase Option.
For the purposes of the foregoing, a Change of Control shall mean the
occurrence of any of the following events:
(i) Any "person" (as such term is defined in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended) is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing 50% or more of the total
voting power represented by the Company's then outstanding voting securities
other than in a private financing transaction approved by the Board of
Directors;
(ii) the direct or indirect sale or exchange by the shareholders
of the Company of all or substantially all of the stock of the Company;
(iii) a merger or consolidation in which the Company is a party
and in which the shareholders of the Company before such merger or
consolidation do not retain, directly or indirectly, at a least majority of the
beneficial interest in the voting stock of the Company after such transaction;
or
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(iv) the sale or disposition by the Company of all or
substantially all the Company's assets.
(e) Acceleration Upon Termination of Employment. In addition to the
Shares released from the Company's Repurchase Option pursuant to Section 4(d)
above, in the event the Purchaser's employment terminates as a result of an
Involuntary Termination other than for Cause upon or within 12 months after a
Change of Control, all Unreleased Shares shall be released from the Company's
Purchase Option upon the date of such termination.
For the purposes of this Section 4(e), the following terms referred to in
this Agreement shall have the following meanings:
(i) Cause. "Cause" shall mean (i) any act of personal
dishonesty taken by the Purchaser in connection with his responsibilities as an
employee and intended to result in substantial personal enrichment of the
Purchaser, (ii) conviction of a felony that is injurious to the Company, and
(iii) a willful act by the Purchaser which constitutes gross misconduct and
which is injurious to the Company.
(ii) Disability. "Disability" shall mean that the Purchaser has
been unable to substantially perform his duties as the result of his incapacity
due to physical or mental illness, and such inability, at least 26 weeks after
its commencement, is determined to be total and permanent by a physician
selected by the Company or its insurers and acceptable to the Purchaser or the
Purchaser's legal representative (such agreement as to acceptability not to be
unreasonably withheld).
(iii) Involuntary Termination. "Involuntary Termination" shall
mean (i) without the Purchaser's express written consent, the significant
reduction of the Purchaser's duties or responsibilities relative to the
Purchaser's duties or responsibilities in effect immediately prior to such
reduction; provided, however, that a reduction in duties or responsibilities
solely by virtue of the Company being acquired and made part of a larger entity
(as, for example, when the Chief Financial Officer of Company remains as such
following a Change of Control and is not made the Chief Financial Officer of the
acquiring corporation) shall not constitute an "Involuntary Termination"; (ii)
without the Purchaser's express written consent, a substantial reduction,
without good business reasons, of the facilities and perquisites (including
office space and location) available to the Purchaser immediately prior to such
reduction; (iii) without the Purchaser's express written consent, a material
reduction by the Company in the base compensation of the Purchaser as in effect
immediately prior to such reduction, or the ineligibility of the Purchaser to
continue to participate in any long-term incentive plan of the Company; (iv) a
material reduction by the Company in the kind or level of employee benefits to
which the Purchaser is entitled immediately prior to such reduction with the
result that the Purchaser's overall benefits package is significantly reduced;
(v) the relocation of the Purchaser to a facility or a location more than 50
miles from the Purchaser's then present location, without the Purchaser's
express written consent; (vi) any purported termination of the Purchaser by the
Company which is not effected for death or Disability or for Cause, or any
purported termination for which the grounds relied upon are not valid; or (vii)
the failure of the Company to obtain the assumption of this agreement by any
successors contemplated in Section 4(f) below.
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(f) Successors.
(i) Company's Successors. Any successor to the Company (whether
direct or indirect and whether by purchase, merger, consolidation, liquidation
or otherwise) to all or substantially all of the Company's business and/or
assets shall assume the obligations under this Section 4 and agree expressly to
perform the obligations under this Section 4 in the same manner and to the same
extent as the Company would be required to perform such obligations in the
absence of a succession. For all purposes under this Section 4, the term
"COMPANY" shall include any successor to the Company's business and/or assets
which executes and delivers the assumption agreement described in this Section
4(f)(i) or which becomes bound by the terms of this Agreement by operation of
law.
(ii) Purchaser's Successors. The terms of this Section 4 and all
rights of the Purchaser hereunder shall inure to the benefit of, and be
enforceable by, the Purchaser's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.
5. Restriction on Transfer.
(a) Except for the escrow described below in Xxxxxxx 0, xxxx of the
Shares or any beneficial interest therein shall be transferred, encumbered or
otherwise disposed of in any manner until the release of such shares from the
Repurchase Option in accordance with the provisions of this Agreement.
(b) Before any Shares may be sold or transferred (including transfer
by operation of law), such Shares shall first be offered to the Company (the
"RIGHT OF FIRST REFUSAL").
(i) Notice. In the event the Purchaser wishes to sell the
Shares, Purchaser shall deliver a notice ("Notice") to the Company stating (A)
his bona fide intention to sell or transfer such Shares, (B) the number of such
Shares to be sold or transferred, (C) the price for which he proposes to sell or
transfer such Shares, and (D) the name of the proposed purchaser or transferee.
(ii) Election to Purchase. Within thirty (30) days after receipt
of the Notice, the Company or its assignee may elect to purchase all or none of
the Shares to which the Notice refers, at the price per share specified in the
Notice. The purchase of the Shares in either such event shall occur at a closing
held at the Company's principal office at a mutually agreed upon time which in
no event shall be more than thirty (30) days following the end of the time
period in which the Company had to elect to purchase such Shares.
(iii) Sale of Shares by Purchaser. If all of the Shares to which
the Notice refers are not elected to be purchased, as provided in this Section
5(b), Purchaser may sell the Shares to any person named in the Notice at the
price specified in the Notice or at a higher price, provided that such sale or
transfer is consummated within sixty (60) days of the date of said Notice to the
Company, and provided, further, that any such sale is in accordance with all the
terms and conditions hereof.
(iv) Termination of Restrictions. Notwithstanding the provisions
of Section 5(a) above, the Company's Right of First Refusal shall terminate
immediately as to all Shares upon the occurrence of the first to occur of the
following events:
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(A) the acquisition of the Company by another entity by
means of the merger or consolidation of the Company with or into another
corporation in which the stock-holders of the Company immediately prior to such
merger or consolidation own less than 50% of the voting securities of the
surviving entity,
(B) the sale of all or substantially all of the assets of
the Company, or
(C) the date upon which a public market exists for the
Company's capital stock (or any other stock issued to purchasers in exchange for
the Shares purchased under this Agreement). For the purpose of this Agreement, a
"Public Market" shall be deemed to exist if (1) such stock is listed on a
national securities exchange (as that term is used in the Securities Exchange
Act of 1934), or (2) such stock is traded on the over-the-counter market and
prices are published daily on business days in a recognized financial journal.
(v) Assignment. Whenever the Company shall have the right to
purchase Shares under this Section 5, the Company may designate and assign one
or more employees, officers, directors or shareholders of the Company or other
persons or organizations to exercise all of the Company's purchase rights under
this Agreement and purchase all of such Shares; provided that if the fair market
value of the Shares to be purchased on the date of such designated or assignment
(the "Repurchase FMV") exceeds the purchase price of the Shares (determined as
described hereinabove) to be purchased, then each such designee or assignee
shall pay the Company cash equal to the difference between the Repurchase FMV
and the purchase price of the Shares which such designee or assignee shall have
the right to purchase.
(vi) Exempt Transfers. The provisions of this Section 5 shall not
apply to a transfer of any Shares by Purchaser, either during his lifetime or on
death by will or intestacy to his ancestors, descendants or spouse, or any
custodian or trustee for the account of Purchaser or Purchaser's ancestors,
descendants or spouse; provided, in each such case that the transferee shall
receive and hold such Shares subject to all of the provisions of this Section 5
and there shall be no further transfer of such Shares except in accordance
herewith.
6. Escrow of Shares. Pursuant to the terms of the Joint Escrow
Instructions attached hereto as Exhibit B, the Shares issued under this
Agreement shall be held by the Escrow Agent (as defined in such Joint Escrow
Instructions) along with a stock assignment executed by the Purchaser in blank
in the form hereto as Exhibit A.
7. Investment Representations. In connection with the purchase of the
Shares, the Purchaser represents to the Company the following:
(a) The Purchaser is aware of the Company's business affairs and
financial condition and has acquired sufficient information about the Company to
reach an informed and knowledgeable decision to acquire the Shares. The
Purchaser is purchasing the Shares for investment for the Purchaser's own
account only and not with a view to, or for resale in connection with, any
"distribution" thereof within the meaning of the Securities Act of 1933, as
amended (the "SECURITIES ACT").
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(b) The Purchaser understands that the Shares have not been
registered under the Securities Act by reason of a specific exemption therefrom,
which exemption depends upon, among other things, the bona fide nature of the
Purchaser's investment intent as expressed herein. In this connection, the
Purchaser understands that, in the view of the Securities and Exchange
Commission (the "COMMISSION"), the statutory basis for such exemption may not be
present if the Purchaser's representations meant that the Purchaser's present
intention was to hold the Shares for a minimum capital gains period under
applicable tax statues, for a deferred sale, for a market rise, for a sale if
the market does not rise, or for a year or any other fixed period in the future.
(c) The Purchaser further acknowledges and understands that the
Shares must be held indefinitely unless they are subsequently registered under
the Securities Act or an exemption from such registration is available. The
Purchaser further acknowledges and understands that the Company is under no
obligation to register the Shares. The Purchaser understands that the
certificate evidencing the Shares will be imprinted with a legend which
prohibits the transfer of the Shares unless they are registered or such
registration is not required in the opinion of counsel satisfactory to the
Company.
8. Stock Certificate Legends. The share certificate evidencing the Shares
issued hereunder shall be endorsed with the following legends:
(a) THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.
THESE SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR ANY EXEMPTION THEREFROM UNDER SAID ACT. COPIES OF THE
AGREEMENT COVERING THE PURCHASE OF THESE SHARES AND RESTRICTING THEIR
TRANSFER MAY BE OBTAINED AT NO COST BY WRITTEN REQUEST MADE BY THE HOLDER
OF RECORD OF THIS CERTIFICATE TO THE SECRETARY OF THE CORPORATION AT THE
PRINCIPAL EXECUTIVE OFFICES OF THE CORPORATION.
(b) THE SHARES REPRESENTED BY THIS CERTIFICATE MAY BE TRANSFERRED
ONLY IN ACCORDANCE WITH THE TERMS OF AN AGREEMENT BETWEEN THE COMPANY AND
THE SHAREHOLDER, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE
COMPANY.
(c) Any legend required by any applicable state securities laws.
9. Market Stand-Off Agreement. The Purchaser hereby agrees, if so
requested by the managing underwriters or the Company in connection with the
initial public offering of the Company's Common Stock, that, without the prior
written consent of such managing underwriters, the Purchaser will not offer,
sell, contract to sell, grant any option to purchase, make any short sale or
otherwise dispose of, assign any legal or beneficial interest in or make a
distribution of any capital stock of the Company held by or on behalf of the
Purchaser or beneficially owned by the Purchaser in accordance with the rules
and regulations of the Securities and Exchange Commission for a period of up to
180 days after the date of the final prospectus relating to the Company's
initial public offering.
10. Adjustment for Stock Split. All references to the number of Shares and
the purchaser price of the Shares in this Agreement shall be appropriately
adjusted to reflect any stock split, reverse stock split
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or stock dividend or other similar change in the Shares which may be made by
the Company after the date of this Agreement.
11. Tax Consequences. The Purchaser has reviewed with the Purchaser's own
tax advisors the federal, state, local and foreign tax consequences of this
investment and the transactions contemplated by this Agreement. The Purchaser
is relying solely on such advisors and not on any statements or
representations of the Company or any of its agents. The Purchaser understands
that the Purchaser (and not the Company) shall be responsible for the
Purchaser's own tax liability that may arise as a result of this investment or
the transactions contemplated by this Agreement. The Purchaser understands that
Section 83 of the Internal Revenue Code of 1986, as amended (the "CODE"), taxes
as ordinary income both (i) the difference between the fair market value of the
Shares when the Company granted the Purchaser the right to purchase the Shares
and the fair market value of the Shares on the date of this Agreement, and (ii)
the difference between the amount paid for the Shares and the fair market value
of the Shares as of the date any restrictions on the Shares lapse. In this
context, "restriction" includes the right of the Company to buy back the Shares
pursuant to its repurchase option. In the event the Company has registered
under the Exchange Act, "restriction" with respect to officers, directors and
10% shareholders could be subject to suit under Section 16(b) of the Exchange
Act. The Purchaser understands that the Purchaser may elect to be taxed at the
time the Shares are purchased rather than when and as the Company's repurchase
option or 16(b) period expires by filing an election under Section 83(b) of the
Code with the I.R.S. within 30 days from the date of purchase.
THE PURCHASER ACKNOWLEDGES THAT IT IS THE PURCHASER'S SOLE
RESPONSIBILITY AND NOT THE COMPANY'S TO TIMELY FILE THE ELECTION UNDER SECTION
83(b), EVEN IF THE PURCHASER REQUESTS THE COMPANY OR ITS REPRESENTATIVES TO MAKE
THIS FILING ON THE PURCHASER'S BEHALF.
12. California Corporate Securities Law. THE SALE OF THE SECURITIES WHICH
ARE THE SUBJECT OF THIS AGREEMENT HAS NOT BEEN QUALIFIED WITH THE COMMISSIONER
OF CORPORATIONS OF THE STATE OF CALIFORNIA AND THE ISSUANCE OF SUCH SECURITIES
OR THE PAYMENT OR RECEIPT OF ANY PART OF THE CONSIDERATION THEREFOR PRIOR TO
SUCH QUALIFICATION IS UNLAWFUL, UNLESS THE SALE OF SECURITIES IS EXEMPT FROM
THE QUALIFICATION BY SECTION 25100, 25102, OR 25105 OF THE CALIFORNIA
CORPORATIONS CODE. THE RIGHTS OF ALL PARTIES TO THIS AGREEMENT ARE EXPRESSLY
CONDITIONED UPON SUCH QUALIFICATION BEING OBTAINED, UNLESS THE SALE IS SO
EXEMPT.
13. Assignment of Technology. In partial consideration for the sale and
issuance of the Stock by the Company to the Purchaser:
(i) Purchaser hereby irrevocably assigns, transfers and conveys to the
Company all of its right, title and interest in and to:
(a) all technical information, know-how, processes, procedures,
compositions, devices, methods, techniques, data, marks (and the goodwill
associated therewith), ideas, discoveries, trade secrets, copyrights or other
subject matter generally relating to micro-optic based broadband and low loss
Dispersion Compensators capable of compensating dispersion induced signal
distortion, and thermally
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tunable WDM devices capable of wavelength tuning for applications such as
programmable ADD/DROP Modules and Optical Cross-Connect systems (collectively,
the "Technology"), including without limitation any and all invention(s)
disclosed in the Technology and all embodiments thereof (the "Inventions");
(b) all rights to apply in any and all countries of the world for
patents, certificates of inventions or other governmental grants on the
Inventions, including the right to apply for patents pursuant to the
International Convention for the Protection of Industrial Property or pursuant
to any other convention, treaty, agreement or understanding;
(c) any and all applications filed and any and all patents,
certificates of inventions or other governmental grants granted on the
Invention in the United States or any other country, including each and every
application filed and each and every patent granted on any application which is
a division, substitution or continuation of any of said applications
(collectively, the "Patents");
(d) each and every reissue or extension of any of the Patents;
(e) in and to each and every patent claim resulting from a
reexamination certificate for any and all of the Patents; and
(f) any and all causes of action relating to the enforcement of the
Technology and any and all other right or interest in or to the Technology, in
each case existing as of or arising after the Effective Date.
(ii) Purchaser represents and warrants that (i) Purchaser is the owner of
the entire right, title, and interest in and to the Technology; (ii) Purchaser
has the sole right and authority to enter into this Agreement and grant the
rights hereunder; (iii) Purchaser has not previously granted and will not grant
any rights or licenses in the Technology; (iv) to the best of its knowledge,
there are no claims of third parties that would call into question the rights of
Purchaser to grant to the Company the rights contemplated hereunder; (v) as of
the Closing Date, Purchaser does not own any patents, patent applications,
technical information, know-how, processes, compositions, devices, methods,
techniques, data, market, ideas, discoveries, trade secrets, copyrights or other
intellectual property related to micro-optic based broadband and low loss
Dispersion Compensators capable of compensating dispersion induced signal
distortion, and thermally tunable WDM devices capable of wavelength tuning for
applications such as programmable ADD/DROP Modules and Optical Cross-Connect
systems except for the Technology assigned to the Company.
(iii) Purchaser agrees to execute any and all papers and documents, and
take such other actions as are reasonably requested by the Company, to evidence,
perfect or defend the foregoing assignment and fully implement the Company's
proprietary rights in the subject matter assigned hereunder, such as obtaining
and enforcing patents, and to fully cooperate in the prosecution, enforcement
and defense of such proprietary rights. Purchaser further agrees that if the
Company is unable, for any reason, to secure such signatures to apply for or to
pursue any application for any patent, copyright or other proprietary right
covering any Technology assigned to the Company above, then Purchaser hereby
irrevocably designates and appoints the Company and its duly authorized officers
and agents as Purchaser's agent and attorney-in-fact, to act for and in
Purchaser's behalf and stead to execute and file any such applications and
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to do all other lawfully permitted acts to further the prosecution and issuance
of patents, copyright and other registrations thereon with the same legal force
and effect as if executed by Purchaser.
14. General Provisions.
(a) This Agreement shall be governed by the laws of the State of
California. This Agreement represents the entire agreement between the parties
with respect to the purchase of Common Stock by the Purchaser and may only be
modified or amended in writing signed by both parties.
(b) Any notice, demand or request required or permitted to be given
by either the Company or the Purchaser pursuant to the terms of this Agreement
shall be in writing and shall be deemed given when delivered personally or
deposited in the U.S. mail, First Class with postage prepaid, and addressed to
the parties at the addresses of the parties set forth at the end of this
Agreement or such other address as a party may request by notifying the other
in writing.
(c) The rights and benefits of the Company under this Agreement
shall be transferable to any one or more persons or entities, and all covenants
and agreements hereunder shall inure to the benefit of, and be enforceable by
the Company's successors and assigns. The rights and obligations of the
Purchaser under this Agreement may only be assigned with the prior written
consent of the Company and any purported transfer otherwise shall be null and
void.
(d) Either party's failure to enforce any provision or provisions of
this Agreement shall not in any way be construed as a waiver of any such
provision or provisions, nor prevent that party thereafter from enforcing each
and every other provision of this Agreement. The rights granted both parties
herein are cumulative and shall not constitute a waiver of either party's right
to assert all other legal remedies available to it under the circumstances.
(e) The Purchaser agrees upon request to execute any further
documents or instruments necessary or desirable to carry out the purposes or
intent of this Agreement.
(f) PURCHASER ACKNOWLEDGES AND AGREES THAT THE LAPSING OF THE
REPURCHASE OPTION PURSUANT TO SECTION 4 HEREOF IS EARNED ONLY BY CONTINUING
SERVICE AS AN "AT WILL" EMPLOYEE OF THE COMPANY (AND NOT THROUGH THE ACT OF
BEING HIRED OR PURCHASING SHARES HEREUNDER). PURCHASER FURTHER ACKNOWLEDGES AND
AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE
REPURCHASE OPTION SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR
IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS AN EMPLOYEE FOR SUCH PERIOD, FOR ANY
PERIOD, OR AT ALL, AND SHALL NOT INTERFERE WITH THE COMPANY'S RIGHT TO
TERMINATE PURCHASER'S EMPLOYMENT AT ANY TIME, WITH OR WITHOUT CAUSE.
(g) Purchaser has reviewed this Agreement in its entirety, has had
an opportunity to obtain the advice of counsel prior to executing this
Agreement and fully understands all provisions of this Agreement.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the day and year first set forth above.
PURCHASER: AVANEX CORPORATION
/s/ SIMON XXXXXXX XXX /s/ SIMON XXXXXXX XXX
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(Name) Xxxxx Xxxxxxx Xxx Xxxxx Xxxxxxx Xxx, President
Address: Address:
0000 Xxxxxxxx Xxx 0000 Xxxxxxxx Xxx
Xxx Xxxxx, Xxxxxxxxxx 00000 Xxx Xxxxx, Xxxxxxxxxx 00000
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CONSENT OF SPOUSE
I, Xxxxx Xxx, spouse of Xxxxx Xxx, have read and approve the foregoing
Agreement. In consideration of granting of the right to my spouse to purchase
shares of Avanex Corporation as set forth in the Agreement, I hereby appoint my
spouse as my attorney-in-fact in respect to the exercise of any rights under
the Agreement and agree to be bound by the provisions of the Agreement insofar
as I may have any rights in said Agreement or any shares issued pursuant thereto
under the community property laws of the State of California or similar laws
relating to marital property in effect in the state of our residence as of the
date of the signing of the foregoing Agreement.
Dated: Jan. 20, 1998
/s/ XXXXX XXX
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EXHIBIT A
ASSIGNMENT SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED I, , herby sell,
assign and transfer unto ( ) shares of
the Common Stock of Avanex Corporation standing in my name on the books of said
corporation represented by Certificate No. herewith and do hereby irrevocably
constitute and appoint Wilson, Sonsini, Xxxxxxxx & Xxxxxx, attorney, to transfer
the said stock on the books of the within named corporation with full power of
substitution in the premises.
This Stock Assignment may be sued only in accordance with the Founder
Stock Purchase Agreement between Avanex Corporation and the undersigned dated
January 13, 1998.
Dated:
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/s/ SIMON XXXXXXX XXX
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(Name) Simon Xxxxxxx Xxx
INSTRUCTIONS: Please do not fill in the blanks other than the signature line.
The purpose of this assignment is to enable the Company to exercise its
"Repurchase Option," as set forth in the Agreement, without requiring additional
signatures on the part of the Purchaser.
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EXHIBIT B
JOINT ESCROW INSTRUCTIONS
January 13, 1998
Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxxx X. X'Xxxxx
Ladies and Gentlemen:
As escrow agent (the "Escrow Agent") for both Avanex Corporation, a
California corporation (the "Company"), and the undersigned purchaser of stock
of the Company (the "Purchaser"), you are hereby authorized and directed to hold
the documents delivered to you pursuant to the terms of that certain Founder
Stock Purchase Agreement ("Agreement") between the Company and the undersigned
(the "Escrow"), in accordance with the following instructions:
1. In the event the Company and/or any assignee of the Company (referred
to collectively for convenience herein as the "Company") exercises the
Company's Repurchase Option (as defined in the Agreement), the Company shall
give to Purchaser and you a written notice specifying the number of shares of
stock to be purchased, the purchase price and the time for a closing hereunder
at the principal office of the Company. Purchaser and the Company hereby
irrevocably authorize and direct you to close the transaction contemplated by
such notice in accordance with the terms of said notice.
2. At the closing, you are directed (a) to date the stock assignments
necessary for the transfer in question, (b) to fill in the number of shares
being transferred, and (c) to deliver same, together with the certificate
evidencing the shares of stock to be transferred, to the Company or its
assignee, against the simultaneous delivery to you of the purchase price (by
cash, a check, cancellation of indebtedness or some combination thereof) for
the number of shares of stock being purchased pursuant to the exercise of the
Company's repurchase option.
3. Purchaser irrevocably authorizes the Company to deposit with you any
certificates evidencing shares of stock to be held by you hereunder and any
additions and substitutions to said shares as defined in the Agreement.
Purchaser does hereby irrevocably constitute and appoint you as Purchaser's
attorney-in-fact and agent for the term of this Escrow to execute with respect
to such securities all documents necessary or appropriate to make such
securities negotiable and to complete any transaction herein contemplated,
including but not limited to the filing with any applicable state blue sky
authority of any required applications for consent to, or notice of transfer of,
the securities. Subject to the provisions
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of the Agreement and of this Escrow Agreement, Purchaser shall exercise all
rights and privileges of a shareholder of the Company while the stock is held by
you.
4. Upon written request of the Purchaser, but no more than once per
calendar year, unless the Company's repurchase option has been exercised, you
will deliver to Purchaser a certificate or certificates representing so many
shares of stock as are not then subject to the Company's repurchase option.
Within 90 days after cessation of Purchaser's continuous employment by the
Company, or any parent or subsidiary of the Company, you will deliver to
Purchaser a certificate or certificates representing the aggregate number of
shares held or issued pursuant to the Agreement and not purchased by the Company
or its assignees pursuant to exercise of the Company's repurchase option.
5. If at the time of termination of this escrow you should have in your
possession any documents, securities or other property belonging to Purchaser,
you shall deliver all of the same to Purchaser and shall be discharged of all
further obligations hereunder.
6. Your duties hereunder may be altered, amended, modified or revoked
only by a writing signed by all of the parties hereto.
7. You shall be obligated only for the performance of such duties as are
specifically set forth herein and may rely and shall be protected in relying or
refraining from acting on any instrument reasonably believed by you to be
genuine and to have been signed or presented by the proper party or parties. You
shall not be personally liable for any act you may do or omit to do hereunder as
Escrow Agent or as attorney-in-fact for Purchaser while acting in good faith,
and any act done or omitted by you pursuant to the advice of your own attorneys
shall be conclusive evidence of such good faith.
8. You are hereby expressly authorized to disregard any and all warnings
given by any of the parties hereto or by any other person or corporation,
excepting only orders or process of courts of law and are hereby expressly
authorized to comply with and obey orders, judgments or decrees of any court. In
case you obey or comply with any such order, judgment or decree, you shall not
be liable to any of the parties hereto or to any other person, firm or
corporation by reason of such compliance, notwithstanding any such order,
judgment or decree being subsequently reversed, modified, annulled, set aside,
vacated or found to have been entered without jurisdiction.
9. You shall not be liable in any respect on account of the identity,
authorities or rights of the parties executing or delivering or purporting to
execute or deliver the Agreement or any documents or papers deposited or called
for hereunder.
10. You shall not be liable for the outlawing of any rights under the
Statute of Limitations with respect to these Joint Escrow Instructions or any
documents deposited with you.
11. You shall be entitled to employ such legal counsel and other experts
as you may deem necessary properly to advise you in connection with your
obligations hereunder, may rely upon the advice of such counsel, and may pay
such counsel reasonable compensation therefor.
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12. Your responsibilities as Escrow Agent shall terminate if you shall
cease to be an officer or agent of the Company or if you shall resign by written
notice to each party. In the event of any such termination, the Company shall
appoint a successor Escrow Agent.
13. If you reasonably require other or further instruments in connection
with these Joint Escrow Instructions or obligations in respect hereto, the
necessary parties hereto shall join in furnishing such instruments.
14. It is understood and agreed that should any dispute arise with respect
to the delivery and/or ownership or right of possession of the securities held
by you hereunder, you are authorized and directed to retain in your possession
without liability to anyone all or any part of said securities until such
disputes have been settled either by mutual written agreement of the parties
concerned or by a final order, decree or judgment of a court of competent
jurisdiction after the time for appeal has expired and no appeal has been
perfected, but you shall be under no duty whatsoever to institute or defend any
such proceedings.
15. Any notice required or permitted hereunder shall be given in writing
and shall be deemed effectively given upon personal delivery or upon deposit in
the United States Post Office, by registered or certified mail with postage and
fees prepaid, addressed to each of the other parties thereunto entitled at the
following addresses or at such other addresses as a party may designate by ten
days' advance written notice to each of the other parties hereto:
COMPANY: Avanex Corporation
PURCHASER: Xxxxx Xxx
0000 Xxxxxxxx Xxx
Xxx Xxxxx, XX 00000
ESCROW AGENT: Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxxx X. X'Xxxxx
16. By signing these Joint Escrow Instructions, you become a party hereto
only for the purpose of said Joint Escrow Instructions; you do not become a
party to the Agreement.
17. This instrument shall be binding upon and inure to the benefit of the
parties hereto, and their respective successors and permitted assigns.
18. These Joint Escrow Instructions shall be governed by, and construed
and enforced in accordance with, the laws of the State of California.
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Very truly yours,
AVANEX CORPORATION
/s/ XXXXX XXX
-----------------------------------
Simon Xxxxxxx Xxx, President
PURCHASER:
/s/ XXXXX X. XXX
-----------------------------------
(Name) Simon Xxxxxxx Xxx
ESCROW AGENT:
XXXXXX XXXXXXX XXXXXXXX & XXXXXX
Professional Corporation
By: /s/ Xxxxxx X. X'Xxxxx
----------------------------------
Xxxxxx X. X'Xxxxx
