Document:

exv10w58

 

Exhibit 10.58

Summary Description of LSI Logic Corporation 2007 Incentive Plan

     On March 21, 2007, the Compensation Committee of the Board of Directors of LSI Logic
Corporation (the “Company”) adopted the 2007 Incentive Plan (the “2007 Incentive Plan”) for the
Company. The bonus pool under the 2007 Incentive Plan is not funded until the Company meets a
predetermined operating income threshold, in both absolute dollars and as a percentage of revenue.
Thereafter, the bonus pool increases as operating income, in both absolute dollars and as a
percentage of revenue, increases. The maximum bonus pool will not exceed $30 million. The
Company’s named executive officers, other than the CEO, as well as other employees of the Company,
are eligible to participate in the 2007 Incentive Plan. The target bonus for named executive
officers, other than the CEO, is between 60% and 70% of the named executive officer’s base
compensation. Actual bonus payments to named executive officers maybe greater than or less than
the stated target amount.exv10w36

 

Exhibit 10.36

 

PURCHASE AGREEMENT

dated as of March 23, 2007

among

FINISAR CORPORATION,

AZNA LLC,

PARVIZ TAYEBATI,

THE COMMON UNITHOLDERS AND OPTIONHOLDERS OF AZNA LLC

SET FORTH ON SCHEDULE I ATTACHED HERETO,

and

PARVIZ TAYEBATI, as the Sellers’ Representative

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	ARTICLE I. Definitions and Usage
	 	 	4	 
	1.1 Definitions
	 	 	4	 
	ARTICLE II. The Purchase and Sale of LLC Interests
	 	 	9	 
	2.1 Purchase and Sale of LLC Interests
	 	 	9	 
	2.2 Escrow
	 	 	9	 
	2.3 Purchase Price Adjustment
	 	 	10	 
	2.4 Closing
	 	 	11	 
	ARTICLE III. Representations and Warranties
	 	 	11	 
	3.1 Representations and Warranties of AZNA with respect to AZNA
	 	 	11	 
	3.2 Representations and Warranties of Founder
	 	 	28	 
	3.3 Representations and Warranties of the Common Unitholders and Common
Optionholders
	 	 	29	 
	3.4 Representations and Warranties of Finisar to Sellers
	 	 	29	 
	3.5 Representations and Warranties of Finisar to Founder
	 	 	30	 
	ARTICLE IV. Covenants Relating to Conduct of Business
	 	 	32	 
	4.1 Conduct of Business
	 	 	32	 
	4.2 No Negotiation or Solicitation
	 	 	34	 
	4.3 Access to Information; Confidentiality
	 	 	34	 
	ARTICLE V. Additional Agreements
	 	 	35	 
	5.1 Reasonable Efforts; Notification
	 	 	35	 
	5.2 Fees and Expenses
	 	 	35	 
	5.3 Public Announcements
	 	 	35	 
	5.4 Transfer Taxes
	 	 	35	 
	5.5 Employment Matters
	 	 	35	 
	5.6 Resignation of Directors and Officers
	 	 	36	 
	5.7 Withholding Rights
	 	 	36	 
	5.8 FIRPTA Certificates
	 	 	36	 
	5.9 Enter into Transaction Agreements
	 	 	36	 
	5.10 Securities Law Matters
	 	 	36	 
	5.11 Nasdaq Quotation
	 	 	39	 

 

 

	 	 	 	 	 
	 	 	Page	 
	5.12 Additional Contracts
	 	 	40	 
	ARTICLE VI. Conditions Precedent
	 	 	40	 
	6.1 Conditions to Each Party’s Obligation to Effect the Transactions
	 	 	40	 
	6.2 Conditions to Obligations of Finisar
	 	 	40	 
	6.3 Conditions to Obligation of Sellers
	 	 	41	 
	ARTICLE VII. Termination, Amendment and Waiver
	 	 	42	 
	7.1 Termination
	 	 	42	 
	7.2 Effect of Termination
	 	 	43	 
	7.3 Amendment
	 	 	43	 
	7.4 Extension; Waiver
	 	 	43	 
	7.5 Procedure for Termination, Amendment, Extension or Waiver
	 	 	43	 
	ARTICLE VIII. General Provisions
	 	 	43	 
	8.1 Notices
	 	 	43	 
	8.2 Interpretation
	 	 	44	 
	8.3 Counterparts
	 	 	44	 
	8.4 Entire Agreement; No Third-Party Beneficiaries
	 	 	44	 
	8.5 No Third-Party Beneficiaries
	 	 	45	 
	8.6 Governing Law
	 	 	45	 
	8.7 Submission to Jurisdiction
	 	 	45	 
	8.8 Assignment
	 	 	46	 
	8.9 Enforcement
	 	 	46	 
	8.10 Further Assurances
	 	 	46	 
	8.11 Sellers’ Representative
	 	 	46	 
	8.12 Severability
	 	 	48	 
	8.13 Waiver of Jury Trial
	 	 	48	 
	ARTICLE IX. Indemnification; Remedies
	 	 	48	 
	9.1 Survival; Right to Indemnification Not Affected By Knowledge
	 	 	48	 
	9.2 Indemnification and Payment of Damages By Sellers
	 	 	48	 
	9.3 Indemnification and Payment of Damages By Founder and Common
Unitholders and Common Optionholders
	 	 	48	 
	9.4 Indemnification and Payment of Damages by Finisar to Sellers
	 	 	49	 
	9.5 Indemnification and Payment of Damages by Finisar to Founder
	 	 	49	 

2

 

	 	 	 	 	 
	 	 	Page	 
	9.6 Time Limitation on Indemnification
	 	 	49	 
	9.7
Limitations on Amount – Sellers
	 	 	49	 
	9.8
Limitations on Amount – Finisar
	 	 	50	 
	9.9
Procedure for Indemnification – Third Party Claims
	 	 	50	 
	9.10 Procedure for Indemnification – Other Claims
	 	 	51	 
	9.11 Escrow
	 	 	51	 
	9.12 Insurance and Tax Benefits
	 	 	52	 

3

 

PURCHASE AGREEMENT

     THIS PURCHASE AGREEMENT (this “Agreement”) dated as of March 23, 2007 among Finisar
Corporation, a Delaware corporation (“Finisar”), AZNA LLC, a Delaware limited liability company
(“AZNA”), Parviz Tayebati, an individual and the holder of all of the Preferred Units and all of
the Voting Common Units of AZNA (the “Founder”), the holders of all of the Non-Voting Common Units
of AZNA set forth on Schedule I attached hereto (the “Common Unitholders”), and the holders
of all rights or options to purchase Non-Voting Common Units of AZNA set forth on Schedule
I attached hereto (the “Common Optionholders,” and together with Founder and the Common
Unitholders, the “Sellers”). This Agreement is also joined in by Parviz Tayebati, an individual,
to agree to serve as the Sellers’ Representative (as defined hereinafter).

     WHEREAS, Sellers collectively own all of the issued and outstanding Preferred Units, Voting
Common Units and Non-Voting Common Units of AZNA (together, the “Units”) and rights or options to
acquire Units of AZNA (the “Options,” and collectively with the Units, the “LLC Interests”);

     WHEREAS, Sellers desire to sell to Finisar, and Finisar desires to purchase from Sellers, all
of the LLC Interests of AZNA on the terms and conditions set forth in this Agreement (the
“Transactions”);

     WHEREAS, Finisar, AZNA and the Sellers desire to make certain representations, warranties,
covenants and agreements in connection with the purchase and sale of the LLC Interests and all to
prescribe various conditions to the Transactions;

     NOW, THEREFORE, in consideration of the foregoing and the representations, warranties,
covenants and agreements contained in this Agreement, and intending to be legally bound, the
parties agree as follows:

ARTICLE I.

Definitions and Usage

          1.1 Definitions. For purposes of this Agreement, capitalized terms used in this Agreement
have the meanings specified or referred to in this Section or as expressly defined elsewhere in
this Agreement: (A) “Affiliate” of any Person means another Person that directly or indirectly,
through one or more intermediaries, controls, is controlled by, or is under common control with,
such first Person.

               (B) “AZNA Disclosure Letter” means the disclosure letter delivered by Sellers to Finisar to
disclose matters pursuant to this Agreement.

               (C) “Consent” means any approval, consent, ratification, waiver, or other authorization
(including any Governmental Authorization).

               (D) “Contract” means any agreement or contract (whether written or oral and whether express or
implied) that is legally binding.

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               (E) “Encumbrance” means any charge, claim, community property interest, equitable interest,
lien, security interest, mortgage, option, pledge, right of first refusal or restriction of any
kind, including any restriction on use, voting, transfer, receipt of income, or exercise of any
other attribute of ownership.

               (F) “Environment” means soil, land surface or subsurface strata, surface waters (including
navigable waters, ocean waters, streams, ponds, drainage basins, and wetlands), ground waters,
drinking water supply, stream sediments and ambient air (including indoor air).

               (G) “Environmental, Health, and Safety Liabilities” means any cost, damage, expense, liability
or obligation arising pursuant to Environmental Law or Occupational Safety and Health Law.

               (H) “Environmental Law” means any Legal Requirement as of the date hereof or as of the Closing
(as defined hereinafter) concerning or relating to the Environment applicable to the operations of
any Facility, or to the import or export of substances.

               (I) “ERISA” means the Employee Retirement Income Security Act of 1974 or any successor law,
and regulations and rules issued pursuant to that Act or any successor law.

               (J) “Exchange Act” means the Securities Exchange Act of 1934 or any successor law, and
regulations and rules issued pursuant to that Act or any successor law.

               (K) “Facilities” means any real property, leaseholds, or other interests currently or formerly
owned or operated by AZNA and any buildings, plants, structures, or equipment (including motor
vehicles) currently or formerly owned or operated by AZNA.

               (L) “Finisar Common Stock” means the common stock of Finisar, par value $0.001 per share.

               (M) “Finisar Disclosure Letter” means the disclosure letter delivered by Finisar to Sellers to
disclose matters pursuant to this Agreement.

               (N) “GAAP” means United States generally accepted accounting principles, applied on a
consistent basis.

               (O) “Governmental Authorization” means any Consent, license or permit issued, granted, given,
or otherwise made available by or under the authority of any Governmental Body or pursuant to any
Legal Requirement.

               (P) “Governmental Body” means any:

                    (i) federal, state, local, municipal, foreign, or other government;

5

 

                    (ii) governmental or quasi-governmental authority of any nature (including any governmental
agency, branch, department, official, or entity and any court or other tribunal); or

                    (iii) body exercising, or entitled to exercise, any administrative, executive, judicial,
legislative, police, regulatory, or taxing authority or power of any nature.

               (Q) “Hazardous Materials” means every element, compound, product, waste or other substance
that is listed, defined, designated, or classified as, or otherwise determined to be, hazardous,
radioactive, or toxic or a pollutant or a contaminant under or pursuant to any Environmental Law,
including any admixture or solution thereof, and specifically including petroleum and all
derivatives thereof or synthetic substitutes therefor, asbestos or asbestos-containing materials
and polychlorinated biphenyls.

               (R) “IRC” means the Internal Revenue Code of 1986 or any successor law, and regulations issued
by the IRS pursuant to the Internal Revenue Code or any successor law.

               (S) “IRS” means the United States Internal Revenue Service or any successor agency, and, to
the extent relevant, the United States Department of the Treasury.

               (T) “Knowledge” or “known” shall mean the actual knowledge after reasonable inquiry by, (i)
with respect to AZNA, Parviz Tayebati, Daniel Mahgerefteh, Frank Fan, Kevin McCallion and Parvin
Tayebati, and (ii) with respect to Finisar, Stephen Workman, as the case may be.

               (U) “Legal Requirement” means any federal, state, local, municipal, foreign, international,
multinational, or other administrative order, constitution, law, ordinance, common law, regulation,
statute, directive or treaty.

               (V) “Material Adverse Change” or “Material Adverse Effect” means, when used in connection with
AZNA or Finisar, any change or effect that (i) is materially adverse to the business, properties,
assets, condition (financial or otherwise) or results of operations of such party and its
subsidiaries taken as a whole; (ii) would materially impair the ability of such party to perform
its obligations under this Agreement; or (iii) would prevent or materially delay the consummation
by such party of any of the Transactions (defined hereinafter); provided, however,
none of the following, nor any change, event, circumstance or development resulting in or arising
from the following, shall constitute, or be considered in determining whether a Material Adverse
Change or a Material Adverse Effect has occurred:

                    (i) economic factors affecting the national, regional or world economy or acts of war or
terrorism (provided that such factors or acts do not affect such Person in a substantially
disproportionate manner as compared to its competitors);

                    (ii) factors generally affecting the industries or markets in which the Person operates
(provided that such factors do not affect the Person in a substantially disproportionate manner as
compared to its competitors);

6

 

                    (iii) actions required to be taken by the parties under this Agreement or during the pendency
or upon announcement of the Transactions contemplated by this Agreement;

                    (iv) in the case of Finisar only, any matters relating to or arising out of the inquiries,
Proceedings and claims regarding its option grant practices described in the Finisar Disclosure
Letter, as well as any other matters relating to or arising out of the option grant practices that
are the subject matter of such inquiries, Proceedings and claims;

                    (v) changes in laws, rules or regulations;

                    (vi) changes in generally accepted accounting principles;

                    (vii) any fees or expenses incurred in connection with the Transactions contemplated by this
Agreement; and

                    (viii) a decline in the price of Finisar Common Stock (provided that the underlying causes of
any such decline may (subject to the other provisions of this Agreement) be taken into account in
making a determination as to whether there has been a Material Adverse Effect or Material Adverse
Change).

               (W) “Occupational Safety and Health Law” means the Occupational Safety and Health Act of 1970,
29 U.S.C. §§ 651-678, and all state or local statutes, ordinances and regulations enacted or
adopted to provide similar protection for workers at any Facilities, as amended as of the Closing
Date (as defined hereinafter).

               (X) “Order” means any award, decision, injunction, judgment, order, ruling, subpoena, or
verdict entered, issued, made, or rendered by any court or other Governmental Body or by any
arbitrator.

               (Y) “Ordinary Course of Business” means an action taken by a Person will be deemed to have
been taken in the Ordinary Course of Business only if such action is consistent with the past
practices of such Person and is taken in the ordinary course of the normal operations of such
Person.

               (Z) “Organizational Documents” means (i) articles or certificate of incorporation and the
bylaws of a corporation; (ii) partnership agreement and any statement of partnership of a general
partnership; (iii) limited partnership agreement and certificate of limited partnership of a
limited partnership; (iv) certificate of formation and operating agreement of a limited liability
company; (v) any charter or similar document adopted or filed in connection with the creation or
formation of a Person; and (vi) any amendment to any of the foregoing.

               (AA) “Permitted Encumbrances” means (i) Encumbrances (other than Encumbrances imposed under
ERISA or any Environmental Law, or in connection with any claim thereunder) for current taxes, ad
valorem taxes or other similar assessments or charges of Governmental Bodies that are not yet due
and delinquent, (ii) statutory Encumbrances of landlords, carriers, warehousemen, mechanics,
materialmen and other Encumbrances (other than

7

 

Encumbrances imposed under ERISA or any Environmental Law or in connection with any claim
thereunder) imposed by law and created in the Ordinary Course of Business for amounts not yet
overdue and delinquent, (iii) zoning or planning restrictions, easements, permits, rights-of-way,
covenants and restrictions which are customary and typical for properties similar to AZNA’s
properties and which do not (x) interfere materially with the ordinary conduct of any property or
the business of AZNA or (y) detract materially from the value or usefulness of AZNA’s properties to
which they apply; (iv) Encumbrances (other than any Encumbrance imposed by ERISA) consisting of
pledges or deposits required in the ordinary course of business in connection with workers’
compensation, unemployment insurance and other social security legislation, (v) any interest or
title of a lessor or sublessor under any Real Property Lease, and (vi) with respect to any LLC
Interests, any right of AZNA to repurchase any LLC Interests pursuant to the provisions of AZNA’s
Organizational Documents or any agreement between AZNA and the holders of any such LLC Interests,
none of which such rights shall be exercised by AZNA during the period from the date of this
Agreement to the Closing.

               (BB) “Person” means any individual, corporation (including any non-profit corporation),
general or limited partnership, limited liability company, joint venture, estate, trust,
association, organization, labor union, Governmental Body or other entity.

               (CC) “Proceeding” means any action, arbitration, known investigation, litigation, or suit
(whether civil, criminal, administrative or investigative) commenced, brought, conducted, or heard
by or before any Governmental Body or arbitrator.

               (DD) “Release” means any spill, emission, discharge, deposition, escape, leaching, dumping, or
other release into the Environment, whether intentional or unintentional.

               (EE) “Representative” means with respect to a particular Person, any director, officer,
employee, agent, consultant, advisor or other representative of such Person, including legal
counsel, accountants and financial advisors.

               (FF) “Securities Act” means the Securities Act of 1933, as amended from time to time, or any
successor law, and regulations and rules issued pursuant to that Act or any successor law.

               (GG) “Tax” means any and all federal, state, local and foreign taxes, assessments and other
governmental charges, duties and other taxes, including, but not limited to, taxes based upon or
measured by gross receipts, income, profits, sales, use and occupation, and value added, ad
valorem, transfer, franchise, withholding, payroll, recapture, employment, excise and property
taxes, together with all interest, penalties and additions imposed with respect to such amounts.

               (HH) “Threat of Release” means a substantial likelihood of a Release that may require action
in order to prevent or mitigate damage to the Environment that may result from such Release.

               (II) “Threatened” means a claim, Proceeding, dispute, action or other matter will be deemed to
have been “Threatened” if any demand or statement has been made (orally or

8

 

in writing) or any notice has been given (orally or in writing), or if any event has occurred
or any other circumstances exist, that would lead a prudent Person to conclude such a claim,
Proceeding, dispute, action or other matter is likely to be asserted, commenced, taken or otherwise
pursued in future.

ARTICLE II.

The Purchase and Sale of LLC Interests

     2.1 Purchase and Sale of LLC Interests. At the Closing (as defined below), on and
subject to the terms and conditions of this Agreement, Finisar agrees to purchase from Sellers, and
Sellers agree to sell to Finisar, the LLC Interests for a total aggregate purchase price, subject
to adjustment as set forth in Sections 2.3 and 5.2 below, of up to Twenty-one Million Five Hundred
Thousand Dollars ($21,500,000) (the “Purchase Price”), payable by Finisar to Sellers as follows:

          (A) a convertible promissory note payable to Founder, in the form attached hereto as
Exhibit A-1, in the original principal amount of Fifteen Million Six Hundred Thirty-eight
Thousand Three Hundred Twenty-one Dollars ($15,638,321) (the “Initial Consideration Note”);

          (B) a convertible promissory note payable to Founder, in the form attached hereto as
Exhibit A-2, in the original principal amount of One Million Three Hundred Fifty-seven
Thousand Dollars ($1,357,000) (the “Escrow Note”, and together with the Initial Consideration Note,
the “Convertible Notes”);

          (C) Two Million Seven Hundred Three Thousand Eight Hundred Thirty-four Dollars ($2,703,834) in
immediately available funds payable to the Common Unitholders and Common Optionholders in
accordance with the Allocation Agreement (the “Allocation Agreement”) attached hereto as
Exhibit B (the “Cash at Closing”), of which One Million Four Hundred Seventy-four Thousand
Six Hundred Eighty-six Dollars ($1,474,686) shall be deposited into escrow pursuant to Section 2.2
below (the “Escrow Cash”); and

          (D) up to One Million Eight Hundred Thousand Eight Hundred Forty-five Dollars ($1,800,845) in
cash, payable to certain Common Unitholders and Common Optionholders as set forth on Exhibit
B and subject to the terms and conditions of Exhibit C attached hereto (the “Restricted
Cash”).

          Each Seller acknowledges and agrees that, effective immediately upon the Closing, all Options
owned or held by such Seller shall be automatically cancelled and extinguished and have no further
force or effect and shall be converted into only the right to receive as consideration therefor
that portion of the Purchase Price as set forth on Exhibit B. Each Seller agrees to
execute and deliver to Finisar such documents and certificates and to take such other and further
actions as may be reasonably requested by Finisar to evidence the cancellation of such Seller’s
Options.

     2.2 Escrow. At the Closing, or soon thereafter as reasonably practicable, Finisar
will cause to be deposited into escrow (the “Escrow”) the Escrow Note and the Escrow Cash

9

 

(together, the “Escrow Fund”). The Escrow Note and Escrow Cash shall be held by Comerica Bank
or such other financial institution as Finisar and the Founder shall mutually determine (the
“Escrow Agent”) in accordance with and subject to the provisions of an Escrow Agreement
substantially in the form of Exhibit D hereto entered into by and among Finisar, Founder,
Sellers’ Representative and Escrow Agent (the “Escrow Agreement”). The Escrow Note shall be deemed
to have been contributed by the Founder and the Escrow Cash to have been contributed by the Common
Unitholders and Common Optionholders. The Escrow Fund shall be subject to claims of
indemnification under Article IX and the procedures specified in the Escrow Agreement.

     2.3 Purchase Price Adjustment. The Purchase Price shall be subject to adjustment as
follows:

          (A) The Cash at Closing shall be reduced, on a dollar-for-dollar basis, by the sum of (i) any
amount in excess of One Million Five Hundred Thousand Dollars ($1,500,000) borrowed by AZNA on its
line of credit with Bank of America, N.A. as of the Closing and (ii) any other obligation of AZNA
for borrowed money or guaranty by AZNA of any obligation of another person for borrowed money or
otherwise, each as of the Closing.

          (B) The Initial Consideration Note and the Cash at Closing shall be reduced, in the aggregate
and on a proportionate basis, on a dollar-for-dollar basis by an amount equal to one-half (1/2) of
the amount paid by Finisar pursuant to Section 5.2

          (C) Sellers acknowledge and agree that AZNA is a party to certain government contracts,
identified on Exhibit E attached hereto (the “Government Contracts”), which may only be
performed by AZNA following the Closing upon the consent and approval of each applicable United
States governmental agency. In the event each applicable United States governmental agency
delivers to AZNA, on before the Survival Period End Date (as defined below in Section 9.5), final
written notice of its consent and approval to the performance by AZNA of all of the Government
Contracts following the Closing, with no material modification to any rights, duties or obligations
of the parties thereunder and no material delay in payment or performance by the applicable United
States governmental agency under any of the Government Contracts as a consequence of the
acquisition of AZNA by Finisar, then Two Hundred Fifty Thousand Five Hundred Three Dollars
($250,503) of the Escrow Cash currently held in Escrow shall, subject to Article IX of this
Agreement, be released and distributed, within three (3) business days thereafter, to the Common
Unitholders and Common Optionholders on a pro-rata basis in accordance with the portion of Cash at
Closing each is to receive as set forth on Exhibit B, and Finisar, the Founder and Sellers’
Representative agree to jointly instruct the Escrow Agent to effect such release. In the event any
applicable United States governmental agency or agencies delivers final written notice to AZNA at
any time prior to the Survival Period End Date that it does not consent to or approve the
performance by AZNA of any one or more of the Government Contracts following the Closing as a
consequence of the acquisition of AZNA by Finisar, or otherwise consents to or approves the
performance by AZNA of any one or more of the Government Contracts subject to terms or conditions
(including but not limited to material modification to any rights, duties or obligations of the
parties thereunder) which are unacceptable to Finisar in its sole discretion, then Finisar shall be
entitled to recovery against the Escrow Cash

10

 

and Escrow Note, on a dollar-for-dollar basis and without any setoff or reduction, for the
entire aggregate amount which would have been paid to AZNA by the governmental agency pursuant to
such Government Contracts on and after the Closing Date had the governmental agency given its
consent and approval and AZNA had fully performed such Government Contracts in their entirety. In
the event there is any material delay in payment or performance by any applicable United States
governmental agency under any of the Government Contracts as a consequence of the acquisition of
AZNA by Finisar, then Finisar shall be entitled to recovery against the Escrow Cash and Escrow
Note, on a dollar-for-dollar basis and without any setoff or reduction, for the aggregate amount of
damages incurred by AZNA arising or resulting from such material delay in payment or performance.
Any claim by Finisar for damages under this Section 2.3(C) shall be made first against the amount
of Escrow Cash held in the Escrow Fund, up to full amount thereof, and if the Escrow Cash is
insufficient to satisfy the full amount of damages, Finisar may make recourse against the Escrow
Note, up to the full amount thereof, for the remainder of the damages.

     2.4 Closing. The closing of the purchase and sale of the LLC Interests (the
“Closing”) will take place at 10:00 a.m. on a date to be specified by the parties, which (subject
to satisfaction or waiver of the conditions set forth in Sections 6.2 and 6.3) shall be no later
than the fifth business day after satisfaction or waiver of the conditions set forth in Section
6.1, contemplated to be no later than March 26, 2007 (the “Closing Date”), at the offices of Wyatt,
Tarrant & Combs, LLP, 2800 PNC Plaza, 500 West Jefferson Street, Louisville, Kentucky 40202 at
10:00 a.m. local time, unless another date or place is agreed to in writing by the parties hereto.

ARTICLE III.

Representations and Warranties

     3.1 Representations and Warranties of AZNA with respect to AZNA. Except as set forth in
the AZNA Disclosure Letter, AZNA hereby represents and warrants to Finisar with respect to AZNA as
follows:

          (A) Incorporation and Corporate Power. AZNA is a limited liability company duly
organized, validly existing and in good standing under the laws of the State of Delaware and has
the power and authority to carry on its business as now conducted. The copies of the
Organizational Documents for AZNA attached hereto as Part 3.1(A) of the AZNA Disclosure Letter
reflect all amendments made thereto and are correct and complete. AZNA is not in violation of any
of the provisions of its Organizational Documents. AZNA is qualified to do business as a foreign
limited liability company in every jurisdiction in which the nature of its business or its
ownership of property requires it to be so qualified, except for those jurisdictions in which the
failure to be so qualified would not, individually or in the aggregate, have a Material Adverse
Effect on AZNA.

          (B) No Breach. The execution, delivery and performance of this Agreement and the
other Transaction Documents by the Sellers, and the consummation by AZNA and the Sellers of the
transactions contemplated hereby and thereby, do not (i) conflict with or result in any breach of
any of the provisions of, constitute a default under, result in a violation of, or result
in the creation of a right of termination or acceleration of, the provisions of in each case,
in any

11

 

material respect, any indenture, mortgage, lease, loan agreement or other Contract, any
license, or any Governmental Authorization by which AZNA is bound or affected, or create any
Encumbrance upon any of the LLC Interests or any assets of AZNA, (ii) conflict with or result in
any breach of any of the provisions of the Organizational Documents or duly adopted member or
director resolution of AZNA, or (iii) conflict with or result in the violation of, in any material
respect, any Legal Requirement to which AZNA, or any of the property held by AZNA, is subject, or
give any Governmental Body or other Person the right to challenge any of the transactions
contemplated hereunder.

          (C) Governmental Authorizations; Consents. Except as listed in the AZNA Disclosure
Letter, no filing or registration with, or notification to, or other Governmental Authorization or
Consent from any Governmental Body or any other Person is required to be obtained, made or given by
AZNA in connection with the execution, delivery and performance of this Agreement, the other
Transaction Documents or the Transactions contemplated hereby or thereby.

          (D) Subsidiaries. AZNA does not, directly or indirectly, (i) own of record,
beneficially or otherwise, directly or indirectly, any shares of capital stock or securities
convertible into shares of capital stock of another corporation or any ownership or participating
interest in any partnership, limited liability company, joint venture or other non-corporate
business enterprise, or (ii) control any other entity.

          (E) Equity Capital.

               (i) As of the date of this Agreement, Twenty-four Million Five Hundred Ninety-six Thousand
Seventy-two (24,596,072) Preferred Units of AZNA, Six Million Two Hundred Thousand (6,200,000)
Voting Common Units of AZNA and Five Million Six Hundred Ten Thousand Eighty-two (5,610,082)
Non-Voting Common Units of AZNA are issued and outstanding and collectively constitute the Units.
Exhibit B lists the names of all owners, beneficially and of record, of the Units.

               (ii) All of the issued and outstanding Units of AZNA (a) are duly authorized, validly issued,
fully paid and nonassessable, (b) were offered, sold, issued and delivered in compliance with
applicable federal and state securities laws and (c) are not subject to, and were not issued in
violation of, any preemptive rights or any other third party rights created by statute, the
Organizational Documents of AZNA or any agreement to which AZNA is a party or by which AZNA is
bound.

               (iii) There are currently issued and outstanding Options to acquire Three Million Nine Hundred
Ninety Thousand (3,990,000) Non-Voting Common Units, all of which Options have been duly and
validly granted pursuant to AZNA’s 2003 Employee, Director and Consultant Equity Plan (the “Equity
Compensation Plan”). There are currently issued and outstanding Five Million Five Hundred Ten
Thousand Eighty-two (5,510,082) Restricted Units, all of which have been duly and validly issued
and, except as set forth in Part 3.1(E) of the AZNA Disclosure Letter, were issued pursuant to the
Equity Compensation Plan. Exhibit B lists

12

 

the names of all holders of Options and Restricted Units and the number of Units issuable
pursuant to each Option.

               (iv) Except as set forth in Exhibit B, AZNA has no other Units or other equity
interests or securities containing any equity features authorized, issued or outstanding, and there
are no:

                    (a) agreements or other rights or arrangements existing which provide for the sale or issuance
of any Units or other equity interests or securities of AZNA; or

                    (b) rights, subscriptions, warrants, options, conversion rights, agreements or arrangements of
any kind outstanding to purchase, exchange, transfer, sell, register or otherwise acquire from AZNA
any Units or other equity interests or securities of AZNA; or

                    (c) agreements or other obligations (contingent or otherwise) which may require AZNA to
repurchase, redeem or otherwise acquire any Units or other equity interests or securities of AZNA;
or

                    (d) agreements or other obligations (contingent or otherwise) that may prohibit or restrict
AZNA’s ability to do any of the foregoing.

               (v) Except with respect to the Options, no Units or other equity interests or securities of
AZNA are reserved for any purpose.

               (vi) AZNA has not registered any Units or other equity interests or securities of AZNA under
the Securities Act or Exchange Act or registered itself under the Exchange Act.

          (F) Financial Statements; Books and Records.

               (i) AZNA has delivered to Finisar true and complete copies of (a) the unaudited consolidated
balance sheet, as of December 31, 2006, of AZNA (the “Latest Balance Sheet”) and the unaudited
consolidated statement of income and cash flows of AZNA for the 12-month period then ended (such
statement of income and cash flows and the Latest Balance Sheet being hereinafter referred to as
the “Latest Financial Statements” and (b) the unaudited consolidated balance sheets, as of December
31, 2005, 2004 and 2003, of AZNA and the un audited consolidated statement of income and cash flows
of AZNA for each of the years ended December 31, 2005, 2004 and 2003 (collectively, the “Annual
Financial Statements”). The Latest Financial Statements and the Annual Financial Statements are
based upon the information contained in the books and records of AZNA and fairly present in all
material respects the financial condition of AZNA as of the dates thereof and results of operations
for the periods referred to therein. The Latest Financial Statements and the Annual Financial
Statements have been prepared in accordance with GAAP applicable to unaudited financial statements
(and thus may not contain all notes and may not contain prior period comparative data which are
required for compliance with GAAP) and reflect all adjustments necessary for a fair statement of
the financial condition and results of operations for the interim periods presented.

13

 

               (ii) All accounts, books and ledgers related to the business of AZNA are properly and
accurately kept, are complete in all material respects, and there are no material inaccuracies or
discrepancies of any kind contained or reflected therein. None of AZNA’s records, systems,
controls, data, or information is recorded, stored, maintained, operated or otherwise wholly or
partly dependent on or held by any means (including any electronic, mechanical or photographic
process, whether computerized or not) which (including all means of access thereto and therefrom)
are not under the exclusive ownership (excluding licensed software programs) and direct control of
AZNA.

               (iii) All accounts receivable of AZNA (collectively, the “Accounts Receivable”) represent or
will represent valid obligations arising from sales actually made or services actually performed in
the Ordinary Course of Business. Unless paid prior to the Closing Date, and except as set forth in
Part 3.1(F)(iii), the Accounts Receivable are or will be as of the Closing Date current, and to
AZNA’s Knowledge collectible, in the Ordinary Course of Business net of the respective reserves
shown on the accounting records of AZNA as of the Closing Date (which reserves are adequate and
calculated consistent with past practice). There is no contest, claim, or right of set-off under
any Contract with any obligor of an Accounts Receivable relating to the amount or validity of such
Accounts Receivable. The accounts payable of AZNA were incurred in the Ordinary Course of
Business.

          (G) Absence of Undisclosed Liabilities. Except as and to the extent reflected or
specifically reserved against on the Latest Balance Sheet, and except liabilities which have arisen
since the date of the Latest Balance Sheet in the Ordinary Course of Business that are not material
to AZNA, taken as a whole (and none of which is a liability for a breach of contract, breach of
warranty, violation of Legal Requirement, tort, infringement, claim or lawsuit) or, as set forth by
category in Part 3.1(G) of the AZNA Disclosure Letter, AZNA does not have any liabilities or
obligations (whether accrued, absolute, contingent, unliquidated or otherwise, whether due or to
become due, whether known or unknown, and regardless of when asserted) arising out of transactions
or events heretofore entered into, or any action or inaction, or any state of facts existing, with
respect to or based upon transactions or events heretofore occurring, or in connection with the
execution and delivery of this Agreement or the Transactions.

          (H) No Material Adverse Effect. Since the date of the Latest Balance Sheet, (i) AZNA
has conducted its business in the Ordinary Course of Business and (ii) there has been no fact,
event, or circumstance, including, without limitation, those affecting the business, customer,
employee or supplier relations of AZNA, which, individually or in the aggregate, would have a
Material Adverse Effect.

          (I) Absence of Certain Developments. Since date of the Latest Balance Sheet, except
as expressly contemplated by this Agreement and except as disclosed in the AZNA Disclosure Letter,
AZNA has not:

               (i) borrowed any amount or incurred or become subject to any liability in excess of $10,000,
except (a) current liabilities incurred in the Ordinary Course of Business, (b) liabilities
incurred in connection with this Agreement and the Transactions that are

14

 

identified by category in Part 3.1(I) of the AZNA Disclosure Letter, and (c) liabilities under
Contracts entered into in the Ordinary Course of Business;

               (ii) subjected any of its assets with a fair market value in excess of $10,000 to any
Encumbrance, except for Permitted Encumbrances;

               (iii) discharged or satisfied any Encumbrance or paid any liability, in each case with a value
in excess of $10,000, other than current liabilities paid in the Ordinary Course of Business;

               (iv) sold, assigned or transferred (including, without limitation, transfers to any employee,
Affiliate or Unitholder or Optionholder of AZNA) any tangible assets with a fair market value in
excess of $10,000, or canceled any debts or claims, in each case, except in the Ordinary Course of
Business;

               (v) sold, assigned, pledged or transferred (including, without limitation, transfers to any
employee, Affiliate or Unitholder or Optionholder of AZNA) any Intellectual Property;

               (vi) waived any rights of material value or suffered any material losses or material adverse
changes in collection loss experience, whether or not in the Ordinary Course of Business;

               (vii) declared or paid any distributions with respect to any Units or other equity interests
or securities, or redeemed or purchased, directly or indirectly, any Units or other equity
interests or securities of AZNA;

               (viii) issued, sold or transferred any of its equity securities, securities convertible into
or exchangeable for its equity securities or warrants, options or other rights to acquire its
equity securities, or any bonds or debt securities;

               (ix) suffered any material theft, damage, destruction or loss of or to any property or
properties owned or used by it, whether or not covered by insurance;

               (x) made or granted any bonus or any wage, salary or compensation increase to any director,
executive officer, consultant or, except in the Ordinary Course of Business, employee or
information technology consultant, or made or granted any increase in any employee benefit plan or
other arrangement (including, but not limited to, the granting of employee options, restricted
Units, or contingent Unit awards), or except as may be required by applicable Legal Requirements,
amended or terminated any existing employee benefit plan or arrangement, or adopted any new
employee benefit plan or arrangement or made any commitment or incurred any liability to any labor
organization;

               (xi) made any single capital expenditure or commitment in excess of $10,000;

15

 

               (xii) made any loans for borrowed money or advances to, or guarantees for the benefit of, any
officer, director, unitholder or Affiliate of AZNA (except for ordinary travel and business expense
payments) or other Person;

               (xiii) made any change in any tax or financial accounting methods, principles, practices or
elections from those utilized in the preparation of the latest Tax Returns or Annual Financial
Statements except as required by GAAP or the statutory accounting principles and practices
prescribed or permitted by the domiciliary state of the relevant Person; or

               (xiv) entered into any commitment (written or oral, contingent or otherwise) to do any of the
foregoing.

          (J) Title to Properties.

               (i) Since its inception, AZNA has not owned any real property. Part 3.1(J)(i) of the AZNA
Disclosure Letter lists and describes all of the real property leases (the “Leases”), currently
used or occupied by AZNA (collectively the “Leased Real Property”). The Leased Real Property has
access, sufficient for the conduct of the business of AZNA as now conducted to public roads and to
all utilities, including electricity, sanitary and storm sewer, potable water, natural gas and
other utilities, used in the operation of the business at that location.

               (ii) The Leases are in full force and effect, and AZNA holds a valid and existing leasehold
interest under each of the Leases. AZNA has delivered to Finisar complete and accurate copies of
each of the Leases, and none of the Leases has been modified in any respect, except to the extent
that the copies delivered to Finisar disclose such modifications. AZNA is not in default in any
material respect, and no circumstances exist which, if unremedied, would, either with or without
notice or the passage of time or both, result in such default in any material respect by AZNA under
any of the Leases; nor, to the Knowledge of AZNA, is any other party to any of the Leases in
default.

               (iii) All of the leasehold improvements, computers, equipment and other tangible assets
necessary for the conduct of the business of AZNA as now conducted by AZNA are in good condition
and repair, ordinary wear and tear excepted, and are usable in the Ordinary Course of Business.
There are no defects in such assets or other conditions relating thereto which materially and
adversely affect the operation or value of such assets. AZNA owns, or leases under valid leases,
all buildings, leasehold improvements, computers, equipment and other tangible assets necessary for
the conduct of its business as now conducted by AZNA.

               (iv) Except for Leased Property, and except for lease agreements for personal property which
are listed in Part 3.1(L)(i)(f) of the AZNA Disclosure Letter, AZNA owns good and marketable title
to each of the properties and assets used by AZNA, located on the premises of AZNA, or reflected on
the Latest Balance Sheet or acquired since the date thereof, free and clear of all Encumbrances,
except for Permitted Encumbrances.

16

 

          (K) Indemnification Obligations. Except for Contracts (including Leases) entered into
in the Ordinary Course of Business with customers and vendors of AZNA, copies of which have been
delivered to Finisar, AZNA is not a party to any Contract pursuant to which AZNA may have any
indemnification obligations. There is no event, circumstance or other basis that could give rise
to any indemnification obligation of AZNA’s officers and directors under its Organizational
Documents or any Contract between AZNA and any of its officers or directors.

          (L) Contracts and Commitments.

               (i) Part 3.1(L)(i) of the AZNA Disclosure Letter lists the following Contracts, whether oral
or written, to which AZNA is a party, which are currently in effect:

                    (a) any joint venture or partnership agreement;

                    (b) except for agreements with customers in the Ordinary Course of Business, any
confidentiality agreement;

                    (c) any Contract relating to the voting of the Units or the election of directors of AZNA;

                    (d) any agreement or indenture relating to the borrowing of money or placing an Encumbrance on
any of the assets of AZNA;

                    (e) any guaranty of any obligation for borrowed money or otherwise;

                    (f) any lease agreement under which it is lessor or lessee of any property, real or personal,
except leases for personal property involving less than $10,000 individually and $25,000 in the
aggregate;

                    (g) any Contract (including, but not limited to, purchase orders);

                    (h) any Contract or group of related Contracts with the same party for the sale of products or
services under which the undelivered balance of such products or services has a sales price in
excess of $10,000 over the remaining term of the Contract;

                    (i) any Contract or group of related Contracts with the same party not otherwise disclosed in
Part 3.1(L)(i) of the AZNA Disclosure Letter (other than any Contract or group of related Contracts
for the purchase or sale of products or services) continuing over a period of more than six months
from the date or dates thereof, not terminable by it on 30 days’ or less notice without penalty and
involving more $10,000 over the remaining term of the Contract;

                    (j) any Contract which prohibits AZNA or any other Affiliate from freely engaging in any
business, or which prohibits AZNA or any Affiliate from soliciting customers or any other business,
anywhere in the world;

17

 

                    (k) any Contract for the manufacture, supply and/or distribution of the products or services
of AZNA (including any distributor, sales and original equipment manufacturer contract);

                    (l) any franchise agreement, marketing agreement, or royalty agreement;

                    (m) any Contract or commitment for capital expenditures in excess of $25,000;

                    (n) any agreement for the sale of any capital asset;

                    (o) any agreement not otherwise disclosed in Part 3.1(L)(i) of the AZNA Disclosure Letter
involving material non-contingent payment obligations by AZNA;

                    (p) any Contract under which the rights of AZNA may be adversely affected as a result of the
change in control of AZNA contemplated by this Agreement;

                    (q) any power of attorney granted by AZNA to any Governmental Body or other Person;

                    (r) any agreement which provides a rate guaranty extending more than one year after the date
hereof;

                    (s) any Contract which gives any Person any right to any intellectual property or other
proprietary right of AZNA; and

                    (t) any agreement not otherwise disclosed in Part 3.1(L)(i) of the AZNA Disclosure Letter
which is either material to the business of AZNA, taken as a whole, or was not entered into in the
Ordinary Course of Business.

               (ii) AZNA has performed in all material respects all obligations required to be performed by
it in connection with the Contracts required to be disclosed in the AZNA Disclosure Letter (whether
or not under the caption referencing this Section 3.1(L)) and are not in default in any material
respect under any such Contract . AZNA has no present expectation or intention of not fully
performing any material obligation pursuant to any such Contract or commitment required to be
disclosed in the AZNA Disclosure Letter. To the Knowledge of AZNA, there is no current breach or
anticipated breach by any other party to any such Contract.

               (iii) Prior to the date of this Agreement, Finisar has been supplied with a true and correct
copy of each written Contract, and a written description of each oral Contract, referred to in the
AZNA Disclosure Letter (whether or not under the caption referencing this Section 3.1 (L)),
together with all amendments, waivers or other changes thereto.

18

 

          (M) Intellectual Property Rights.

               (i) The term “Intellectual Property” means all intellectual property owned or licensed (as
licensor or licensee) by AZNA (whether domestic or foreign), including without limitation:

                    (a) all registered and unregistered trademarks, service marks and applications for the
foregoing, domestic and foreign, as well as any assumed fictional business names or trade names
(collectively, “Marks”);

                    (b) all patents, patent applications and inventions and discoveries that may be patentable
(collectively, “Patents”);

                    (c) all registered and unregistered copyrights in both published works and unpublished works
(collectively, “Copyrights”);

                    (d) all know-how and confidential or proprietary information that is used in or held by AZNA
for use in its business as it is currently conducted or as proposed to be conducted by it and that
(i) derives independent economic value, actual or potential, from not being generally known to, and
not being readily ascertainable by other Persons who can obtain economic value from its disclosure
or use, and (ii) is the subject of efforts to maintain its secrecy, including without limitation,
retail and wholesale customer lists, vendor lists, technical information, data, process technology,
production techniques and processes, plans, compilations, merchandizing information, cost and
pricing information, business systems, formulas, drawings, models and blue prints, as well as
information regarding future business opportunities (collectively, “Trade Secrets”); and

                    (e) all rights in internet web sites and internet domain names previously or presently used by
AZNA (collectively, “Net Names”).

                    (f) as used in this Section 3.1, the phrase “as proposed to be conducted” when referring to
the business of AZNA refers to its development, manufacture, sale and distribution of the products
or potential products of AZNA.

               (ii) Part 3.1(M)(ii) of the AZNA Disclosure Letter contains a complete and accurate list of
all Marks, Patents, Copyrights, Net Names, and, to the extent possible, Trade Secrets, as well as a
summary description, including any royalties paid or received by AZNA. AZNA has delivered to
Finisar accurate and complete copies of all Contracts relating to the Intellectual Property, except
for any license implied by the sale of a product and perpetual, paid up licenses for commonly
available software programs with a value of less than $1,000 under which AZNA is the licensee.
There are no outstanding and, to AZNA’s Knowledge, no Threatened disputes or disagreements with
respect to any such Contract.

               (iii) The Intellectual Property includes all the intellectual property necessary for the
operation of business of AZNA as it is currently conducted or as proposed to be conducted. AZNA is
the owner of all right, title and interest in and to the Intellectual Property,

19

 

free and clear of any and all Encumbrances, and has the right to use without payment to a
third party all of the Intellectual Property.

               (iv) (a) All of the Intellectual Property (a) is currently in compliance in all material
respects with all Legal Requirements, (b) is valid and enforceable, (c) does not infringe upon any
intellectual property, proprietary or other right of any other Person, and (d) is not currently
being infringed upon by any other Person. None of the products manufactured or sold or proposed to
be manufactured and sold (including but not limited the of products of AZNA currently under
development), nor any process or know-how used, by AZNA infringes, or is alleged to infringe, or
will upon completion of development, infringe or be alleged to infringe, upon any intellectual
property or other proprietary right of any other Person. None of the Intellectual Property has
been challenged or Threatened in any way.

               (v) AZNA has taken reasonable safety measures and precautions in accordance with normal
industry standards to protect the secrecy, confidentiality, ownership in, rights to or value of any
Trade Secrets.

               (vi) AZNA has not obtained any product clearance or similar opinions with respect to any of
the Intellectual Property.

          (N) Compliance With Legal Requirements; Governmental Authorizations.

               (i) Except as set forth in Part 3.1(N)(i) of the AZNA Disclosure Letter:

                    (a) AZNA is in compliance in all material respects with each Legal Requirement applicable to
it or to the conduct of its business or the ownership or use of any of its assets; and

                    (b) AZNA has not received any written notice from any Governmental Body or any other Person
regarding any violation of, or failure to comply with, any Legal Requirement in any material
respect, which is outstanding or unresolved as of the date hereof.

               (ii) Part 3.1(N)(ii) of the AZNA Disclosure Letter contains a complete and accurate list of
each material Governmental Authorization that is held by AZNA . Each Governmental Authorization
listed in Part 3.1(N)(ii) of the AZNA Disclosure Letter is valid and in full force and effect.
Except as set forth in Part 3.1(N)(ii) of the AZNA Disclosure Letter:

                    (a) AZNA is in compliance in all respects with all of the terms and requirements of each
Governmental Authorization held by it;

                    (b) AZNA has not received, at any time, any written notice from any Governmental Body
regarding (A) any violation of or failure to comply with any term or requirement of any
Governmental Authorization, or (B) any actual, proposed, possible, or potential revocation,
withdrawal, suspension, cancellation, termination of, or modification to any Governmental
Authorization, which is outstanding or unresolved as of the date hereof; and

20

 

                    (c) all applications required to have been filed for the renewal of the Governmental
Authorizations listed in Part 3.1(N)(ii) of the AZNA Disclosure Letter have been duly filed on a
timely basis with the appropriate Governmental Bodies, and all other filings required to have been
made with respect to such Governmental Authorizations have been duly made on a timely basis with
the appropriate Governmental Bodies.

               (iii) AZNA has all of the Governmental Authorizations necessary to permit it to lawfully
conduct and operate its business in the manner it currently conducts and operate such business and
to permit it to own and use its assets in the manner in which it currently owns and uses such
assets.

               (iv) Neither AZNA nor any director, executive officer, agent or employee of AZNA, has directly
or indirectly, made any contribution, gift, bribe, rebate, payoff, influence payment, kickback, or
other payment to any Person, private or public, regardless of form, whether in money, property, or
services (a) to obtain favorable treatment in securing business, (b) to pay for favorable treatment
for business secured, (c) to obtain special concessions or for special concessions already
obtained, for or in respect of AZNA.

          (O) Legal Proceedings; Orders.

               (i) Except as set forth in Part 3.1(O)(i) of the AZNA Disclosure Letter, as of the date hereof
there is no pending Proceeding:

                    (a) that has been commenced by or against AZNA or any of the assets of AZNA (including but not
limited to any workers’ compensation claims); or

                    (b) that challenges, or seeks to prevent any of the Transactions.

          To the Knowledge of AZNA, no such Proceeding has been Threatened. AZNA has delivered
or made available to Finisar copies of all pleadings, correspondence, and other documents
relating to each Proceeding listed in Part 3.1(O)(i) of the AZNA Disclosure Letter.

               (ii) Except as set forth in Part 3.1(O)(ii) of the AZNA Disclosure Letter:

                    (a) there is no Order to which AZNA or any of its assets is subject; and

                    (b) to the Knowledge of AZNA, no executive officer, director, agent, or employee of AZNA is
subject to any Order that prohibits such executive officer, director, agent, or employee from
engaging in or continuing any conduct, activity, or practice relating to the business of AZNA.

          (P) Employees.

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               (i) Part 3.1(P)(i) of the AZNA Disclosure Letter sets forth a true, correct and complete
listing of all AZNA employees, as well as independent contractors and leased employees, as of the
date hereof, including their respective name, job title or function, and location, as well as a
true, correct and complete listing of the current salary or wage, incentive pay and bonuses,
accrued vacation, and the current status (as to leave or disability pay status, leave eligibility
status, full time or part time, exempt or nonexempt, temporary or permanent status) of such
employees. Other than as fully reflected or specifically reserved against in accordance with GAAP
in the Annual Financial Statements or Latest Financial Statements, AZNA has not paid or promised to
pay any bonuses to such employees. All current and former exempt and non-exempt employees,
independent contractors and leased employees have been properly classified as such by AZNA. AZNA
has delivered or made available to Finisar a true and complete copy of the employee handbook, if
any, applicable to the employees of AZNA.

               (ii) To the Knowledge of AZNA, no executive officer or other employee of AZNA other than
Founder has any plans to terminate his or her employment.

               (iii) AZNA has complied in all material respects with all Legal Requirements relating to the
employment of labor, including provisions thereof relating to wages, hours, equal opportunity,
workers’ compensation, unemployment compensation, collective bargaining and the payment of social
security and other taxes.

               (iv) AZNA has no charges pending or, to the Knowledge of AZNA, Threatened or reasonably
expected to arise against AZNA with the Equal Employment Opportunity Commission, Department of
Labor, or any other comparable state or local agency. AZNA’s labor relations are satisfactory.

               (v) AZNA is not a party to any collective bargaining agreement or other labor union Contract
applicable to persons employed by AZNA.

               (vi) There are no strikes, concerted slowdowns, concerted work stoppages, lockouts or, to the
Knowledge of AZNA, any threats thereof, by or with respect to any employees of AZNA.

               (vii) To the Knowledge of AZNA, no employee of AZNA is subject to any secrecy or
noncompetition agreement or any other agreement or restriction of any kind that would impede the
ability of such employee to carry out fully the activities currently performed by such employee in
furtherance of the business of AZNA.

               (viii) No employee or former employee or contractor or former contractor of AZNA has
Threatened any claim with respect to any Intellectual Property of AZNA. Each employee,
independent contractor and consultant of AZNA has executed a confidentiality, proprietary
information and/or inventions agreement in the form included in Part 3.1(P)(vii) of the AZNA
Disclosure Letter.

          (Q) Employee Benefit Plans.

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               (i) The term “Plan” means every plan, fund, Contract, program and arrangement (formal or
informal, whether written or not) which is sponsored, maintained or contributed to by AZNA for the
benefit of present or former employees of AZNA (the “Employees”) including, without limitation,
those intended to provide: (i) medical, surgical, health care, hospitalization, dental, vision,
life insurance, death, disability, legal services, severance, sickness, accident or other welfare
benefits (whether or not defined in Section 3(1) ERISA), (ii) pension, profit sharing, stock bonus,
retirement, supplemental retirement or deferred compensation benefits (whether or not tax qualified
and whether or not defined in Section 3(2) of ERISA), (iii) bonus, incentive compensation, option,
stock appreciation right, phantom stock or stock purchase benefits or (iv) salary continuation,
supplemental unemployment, termination pay, vacation or holiday benefits (whether or not defined in
Section 3(3) of ERISA). “ERISA Affiliates” means, with respect to AZNA, any other person, that,
together with AZNA, would be treated as a single employer under IRC §414.

               (ii) Part 3.1(R)(ii) of the AZNA Disclosure Letter sets forth each Plan by name.

               (iii) Neither AZNA nor any ERISA Affiliate has within the last six years, maintained,
sponsored, or contributed to any employee pension benefit plan, within the meaning of Section 3(2)
of ERISA that is subject to Title IV of ERISA or IRC Section 412 or is a multiemployer plan within
the meaning of Section 3(37) of ERISA.

               (iv) No employer other than AZNA is permitted to participate or participates in the Plans. No
leased employees (as defined in Section 414(n) of the IRC) or independent contractors are eligible
for, or participate in, any Plan.

               (v) AZNA does not provides health or life insurance benefits for any retired or former
employee and is not obligated to provide health or life insurance benefits to any active employee,
following such employee’s retirement or other termination of service except as otherwise required
by IRC Section 4980B or comparable state statute which provides for continuing health care
coverage.

               (vi) With respect to all Plans, to the extent that the following documents exist, AZNA has
furnished or made available to Finisar true and complete copies of: (a) the most recent
determination letter, if any, received by AZNA from the IRS, (b) all pending applications for
rulings, determinations, opinions, no action letters and the like filed with any governmental
agency (including the Department of Labor and the IRS), (c) the Annual Report/Return (Form Series
5500) with financial statements, if any, and attachments for the three most recent plan years, and
(d) Plan documents, summary plan descriptions, trust agreements, insurance contracts, and service
agreements.

               (vii) Each Plan has at all times been operated in compliance in all material respects with
ERISA, the IRC, any other applicable Legal Requirements (including all reporting and disclosure
requirements thereunder) and the terms of the Plan. With respect to each Plan that is intended to
be qualified under Section 401(a) and/or 4975(e)(7) of the IRC, each such Plan has been determined
by the IRS to be so qualified in form, and each trust forming

23

 

a part thereof has been determined by the IRS to be exempt from tax pursuant to Section 501(a)
of the IRC in form. No reason exists which would cause such qualified status to be revoked.
Neither AZNA nor, to the Knowledge of AZNA, any other Person, has engaged in a non-exempt
prohibited transaction under Section 406 or 407 of ERISA or Section 4975 of the IRC with respect to
any Plan.

               (viii) All contributions, premiums, fees or charges due and owing to or in respect of any Plan
for periods on or before the date hereof have been paid in full by AZNA.

               (ix) AZNA has not made or committed to make any material increase in contributions or benefits
under any Plan which would become effective either on or after the Closing Date.

               (x) Other than claims for benefits submitted by participants or beneficiaries, no claim
against, or legal proceeding involving, any Plan is pending or, to the Knowledge of AZNA, is
Threatened. No Plan is or has been under audit or examination (nor has notice been received of a
potential audit or examination) by any domestic or foreign governmental agency or entity.

               (xi) Except as disclosed on Part 3.1(Q)(xi) of the AZNA Disclosure Letter, the events
contemplated in this Agreement will not trigger, or entitle any current or former employee of AZNA
to, severance, termination of employment, change in control payments or accelerated vesting under
any Plan, other than the vesting of benefits under any tax-qualified retirement Plan terminated
pursuant to Section 5.5, and will not result in any Tax or other liability payable by any Plan or,
with respect to any Plan, by AZNA (other than routine claims for benefits).

               (xii) AZNA can terminate each Plan, with proper notice, without further liability to AZNA
(other than administrative expenses associated with terminating).

               (xiii) AZNA has no liability with respect to a failure to comply with the requirements of Part
6 of Title I of ERISA or IRC §4980B applicable to any group health plan.

               (xiv) AZNA has no liability with respect to (a) any employee benefit plan, policy or
arrangement previously maintained or contributed to by AZNA or any ERISA Affiliate but terminated
prior to Closing, or (b) any employee benefit plan, policy or arrangement which does not cover
current or former employees, directors or agents of AZNA which is maintained or contributed to by
an ERISA Affiliate of AZNA.

               (xv) AZNA has no liability with respect to a failure to comply with the requirements of Part 7
of Title I of ERISA, IRC §9801 et. seq. or IRC §4980D applicable to any group health plan
maintained by or contributed to by AZNA or any ERISA Affiliate.

               (xvi) Except as disclosed on Part 3.1(Q)(xvi) of the AZNA Disclosure Letter, none of the Plans
are subject to IRC §409A. With respect to each Plan which is (or but for an exemption could be)
subject to IRC §409A (a) such Plan has been maintained and administered in a manner consistent with
avoiding adverse tax consequences under IRC §409A,

24

 

(b) the transactions contemplated by this Agreement will not result in such adverse tax
consequences, and (c) Part 3.1(Q)(xvi) of the AZNA Disclosure Letter contains a description of the
approach taken to date with respect to each such Plan to comply with (or be exempt from) IRC §409A,
including, as applicable, a description of any transition relief utilized in connection with such
Plan.

          (R) Insurance. Part 3.1(R) of the AZNA Disclosure Letter lists and briefly describes
each insurance policy maintained by AZNA for professional liability, errors and omissions,
directors and officers liability, property, general liability, automobile liability, workers’
compensation, key man life insurance, fidelity, fiduciary and other customary matters
(collectively, the “Insurance Policies”), correct and complete copies of which have been delivered
to Finisar. All of the Insurance Policies are in full force and effect. AZNA (i) is not in
default with respect to its obligations under any of the Insurance Policies, and (ii) has not
failed to give any notice of any claim under any Insurance Policy in due and timely fashion, nor
has any coverage for current claims been denied.

          (S) Affiliate Transactions. Other than pursuant to this Agreement, no executive
officer, director, or Affiliate of AZNA or, to the Knowledge of AZNA, any employee of AZNA, or any
member of the immediate family of any such executive officer, director, Affiliate or, to the
Knowledge of AZNA, employee, or any entity in which any of such persons owns any beneficial
interest (other than any publicly-held corporation whose stock is traded on a national securities
exchange or in the over-the-counter market and less than 1% of the stock of which is beneficially
owned by any of such persons) (collectively “Insiders”), has any Contract with AZNA (other than any
employment arrangements with customary terms) or any interest in any property, real, personal or
mixed, tangible or intangible, used in or pertaining to the business of AZNA. To the Knowledge of
AZNA, none of the Insiders has, or holds a right to acquire, any direct or indirect equity interest
in excess of 5% in any competitor, supplier or customer of AZNA or in any Person from whom or to
whom AZNA leases any property, or in any other Person with whom AZNA transacts business of any
nature. For purposes of this Section 3.1(S), the members of the immediate family of an executive
officer, director, or Affiliate shall consist of the spouse, parents, children, siblings, mothers-
and fathers-in-law, sons- and daughters-in-law, and brothers- and sisters-in-law of such executive
officer, director, employee or Affiliate.

          (T) Customers and Suppliers. Part 3.1(T) of the AZNA Disclosure Letter lists the ten
(10) largest customers and ten (10) largest suppliers of AZNA for the 12-month period ended
December 31, 2006, and sets forth opposite the name of such customer or supplier the approximate
percentage and dollar amount of net sales or purchases by AZNA attributable to such customer or
supplier for such period. Except as disclosed on Part 3.1(T) of the AZNA Disclosure Letter, and
except for changes in the Ordinary Course of Business, no customer or supplier listed on Part
3.1(T) has indicated that it will stop or decrease the rate of business done with AZNA. AZNA makes
no guarantee that the actual financial performance of AZNA for calendar year 2007 and thereafter
will meet or exceed the financial projections for such periods that have been delivered by AZNA to
Finisar. No sole source supplier of any product or component utilized in any current products (or
in products currently being developed) of AZNA has given AZNA any end-of-life or other notice that
such supplier is discontinuing such product or component or will cease to provide it to AZNA.

25

 

          (U) Officers and Directors; Bank Accounts. Part 3.1(U) of the AZNA Disclosure Letter
lists all executive officers and directors of AZNA and sets forth a full and complete list of all
bank accounts and safe deposit boxes of AZNA, the number of each such account or box, and the names
of the persons authorized to draw on such accounts or to access such boxes. All cash in such
accounts is held in demand deposits and is not subject to any restriction as to withdrawal.

          (V) Inventory. All inventory of AZNA consist of a quality and quantity usable and
currently salable in the Ordinary Course of Business.

          (W) Environmental Matters. Except as set forth in Part 3.1(W) of the AZNA Disclosure
Letter:

               (i) AZNA is in compliance in all material respects with Environmental Law. AZNA has not
received any communication from (i) any Governmental Body, or (ii) the current or prior owner or
operator of any Facilities, asserting or alleging an actual or potential violation of any
Environmental Law or a claim for Environmental Health and Safety Liabilities.

               (ii) There are no pending or, to the Knowledge of AZNA, Threatened claims or Encumbrances
resulting from or arising under or pursuant to any Environmental Law, with respect to or affecting
any of the Facilities or any other properties and assets (whether real, personal, or mixed,) in
which any AZNA has or had an interest.

               (iii) There has been no Release or Threatened Release of a Hazardous Substance at or from the
Facilities, nor are Hazardous Materials present on or in the Environment at the Facilities, in
amounts or locations in violation of applicable Environmental Law or that could create
Environmental Health and Safety Liabilities, nor has AZNA permitted or conducted its operations at
any Facilities or any other properties except in compliance in all material respects with
applicable Environmental Laws.

               (iv) AZNA has delivered to Finisar true and complete copies and results of any reports,
studies, analysis, tests, or monitoring currently in the possession of AZNA concerning compliance
by any of them, or any other Person for whose conduct they are or may be held responsible, with
Environmental Laws.

               (v) AZNA has all Governmental Authorizations necessary to permit it to lawfully conduct and
operate its business in the manner it currently conducts and operates such businesses and to permit
it to own and use its assets in the manner in which it currently owns and uses such assets, except
for such failure which would not have a Material Adverse Effect on AZNA.

               (vi) All products held for sale by AZNA comply, and all products sold in the past have
complied to the extent applicable, with Directive 2002/95/EC of the European Parliament and of the
Council on the Restriction of the Use of Certain Hazardous Substances (“ROHS Directive”), as
amended, all European Member State laws enacted to implement the ROHS Directive, and China Ministry
of Information Industry Order #39, Management Methods

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for Controlling Pollution by Electronic Products. No products sold by AZNA at any time
contained asbestos.

               (vii) To the Knowledge of AZNA, Persons that manufacture products for sale by AZNA (“Contract
Manufacturers”) are in compliance in all material respects with Environmental Laws and AZNA has no
Knowledge of facts or circumstances that would lead a reasonable person to believe that Contract
Manufacturers will not be able to continue their manufacturing operations in substantially the same
manner for the foreseeable future.

          (X) Brokerage. No broker, finder, investment banker or other third party shall be
entitled to receive any brokerage commission, finder’s fees, fees for financial advisory services
or similar compensation in connection with the Transactions contemplated by this Agreement based on
any arrangement or agreement made by or on behalf of AZNA or its Representatives.

          (Y) Tax Matters.

                (i) AZNA, and any affiliated, combined or unitary group of which AZNA is or was a member (each
a “Tax Affiliate” and, collectively, the “Tax Affiliates”) has: (a) timely filed (or has had timely
filed on its behalf), taking into account all applicable extension periods, all returns,
declarations, reports, estimates, information returns, and statements relating to Taxes (“Returns”)
required to be filed under Legal Requirement and all such Returns are true, correct, and complete
in all material respects; (b) timely and properly paid (or has had paid on its behalf) all Taxes;
provided that to the extent any Tax reflected on any Return has not been paid, adequate reserves
have been provided for in the books and records of such entity; (c) withheld and paid all Taxes
required by Legal Requirement to have been withheld and paid in connection with any amounts paid or
owing to any employee, independent contractor, creditor, stockholder or other Person.

                (ii) There are no Encumbrances for Taxes upon any assets of AZNA, except Encumbrances for
Taxes not yet due and payable.

                (iii) No deficiency for any Taxes has been proposed, asserted or assessed against AZNA or the
Tax Affiliates that has not been resolved and paid in full. No waiver, extension or comparable
written consent given by AZNA regarding the application of the statute of limitations with respect
to the payment of any Taxes is outstanding, nor is any written request for any such waiver or
consent pending. There are no Federal or state Tax audits pending with regard to any Taxes of
AZNA, nor has AZNA received written or oral notice from a Governmental Body of future Federal or
state Tax audits.

                (iv) Neither AZNA nor any Tax Affiliate is a party to Contract, agreement or understanding
that would result, separately or in the aggregate, in the payment of any “excess parachute
payments” within the meaning of Section 280G of the IRC, either in connection with the Transactions
or otherwise.

27

 

                (v) Neither AZNA nor any Tax Affiliate is a party to or bound by any obligations under any tax
sharing, tax allocation, tax indemnity or similar agreement or arrangement.

                (vi) Neither AZNA nor any Tax Affiliate has been part of a consolidated, unitary or affiliated
or similar group for Tax purposes with any Person, other than a group the common parent of which
was AZNA. Neither AZNA nor any Tax Affiliate has any liability for the Taxes of any Person (other
than AZNA and the Tax Affiliates) under Treasury Regulations Section 1.1502-6 (or any similar
provision of Law) or as a transferee or successor, by Contract or otherwise.

                (vii) No claim has ever been made by an authority in a jurisdiction where any of AZNA or the
Tax Affiliates do not file Tax Returns that it is or may be subject to taxation by that
jurisdiction.

          (Z) Disclosure. No representation or warranty of AZNA in this Agreement and no
statement in the AZNA Disclosure Letter or any certificate required to be delivered by AZNA
hereunder omits to state a material fact necessary to make the statements herein or therein, in
light of the circumstances in which they were made, not misleading.

     3.2 Representations and Warranties of Founder. Founder represents and warrants as to
himself to Finisar as follows:

          (A) Ownership of LLC Interests. Founder is the lawful record owner of all the LLC
Interests which are set forth opposite his name on Exhibit B hereto, which LLC Interests
shall be free and clear of all Encumbrances as of the Closing Date, other than Permitted
Encumbrances and those arising under applicable federal, state and local securities laws.

          (B) Execution, Delivery; Valid and Binding Agreements. This Agreement and the other
Transaction Documents to which Founder is a party have been duly executed and delivered by Founder,
or upon the execution thereof, will be duly executed and delivered by the same, and constitute the
valid and binding obligations of Founder, enforceable in accordance with their respective terms,
except to the extent that enforceability thereof may be limited by bankruptcy, insolvency,
reorganization and other similar laws affecting the enforcement of creditors’ rights generally and
by general principles of equity.

          (C) Investment Intent; Residency. Founder is acquiring the Convertible Notes and the
shares of Finisar Common Stock issuable upon conversion of such notes pursuant to this Agreement
(collectively, the “Securities”) for his own account and not with a view to their distribution
within the meaning of Section 2(11) of the Securities Act. Founder is a resident of the
Commonwealth of Massachusetts.

          (D) Opportunity to Ask Questions. Founder has had an opportunity to ask questions and
receive answers from management of Finisar. Founder has received and had a reasonable time to
review this Agreement and the exhibits and schedules hereto, including but not limited to the
Finisar Disclosure Letter.

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          (E) Private Transaction. Founder acknowledges that the offer and contemplated sale of
the Securities in the Transactions have been conducted in a private transaction in which such notes
have been offered (and, it is contemplated, will be sold) through direct communication between
Finisar and Founder and without use of any form of general advertising.

          (F) Accredited Investor; Sophistication. Founder is an “accredited investor” as such
term is defined in Rule 501(a) under the Securities Act and has such knowledge and expertise
concerning financial and business matters to evaluate the merits and risks of an investment in the
Securities and the Transactions.

          (G) Restricted Securities. Founder understands that the Securities to be issued in
the Transactions have not been registered under the Securities Act, and are being issued in
reliance upon the exemption from the registration contained in Section 4(2) of the Securities Act.
Founder acknowledges that the Securities to be acquired by Founder pursuant to this Agreement are
“restricted securities” and their transferability is restricted under applicable securities laws.
Founder agrees not to transfer such Securities except pursuant to an effective registration
statement under the Securities Act or an exemption from registration under that act, acknowledges
that, Finisar will not be under any obligation to so register such Securities except as set forth
herein, and agrees that a legend providing notice of the restrictions on transferability may be
placed on the certificates representing such shares, until the restrictions on transferability of
the shares under the Securities Act are no longer applicable.

     3.3 Representations and Warranties of the Common Unitholders and Common Optionholders.
Each Common Optionholder or Common Unitholder hereby, severally and not jointly, represents and
warrants as to itself to Finisar as follows:

          (A) Ownership of LLC Interests. He or she is the lawful record owner of all the LLC
Interests which are set forth opposite such Seller’s name in Exhibit B hereto, which LLC
Interests shall be free and clear of all Encumbrances as of the Closing Date, other than Permitted
Encumbrances and those arising under applicable federal, state and local securities laws.

          (B) Execution, Delivery; Valid and Binding Agreements. This Agreement and the other
Transaction Documents to which such Seller is a party have been duly executed and delivered by such
Seller, or upon the execution thereof, will be duly executed and delivered by the same, and
constitute the valid and binding obligations of such Seller, enforceable in accordance with their
respective terms, except to the extent that enforceability thereof may be limited by bankruptcy,
insolvency, reorganization and other similar laws affecting the enforcement of creditors’ rights
generally and by general principles of equity.

     3.4 Representations and Warranties of Finisar to Sellers. Finisar represents and warrants
to Sellers as follows:

          (A) Incorporation and Corporate Power. Finisar is a corporation duly organized,
validly existing and in good standing under the laws of the jurisdiction of its

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incorporation and
has the corporate power and authority to carry on its business as now conducted. Finisar is not in
violation of any of the provisions of its Organizational Documents. Finisar is qualified to do
business as a foreign corporation in every jurisdiction in which the nature of its business or its
ownership of property requires it to be so qualified, except for those jurisdictions in which the
failure to be so qualified would not, individually or in the aggregate, have a Material Adverse
Effect on Finisar.

          (B) Execution, Delivery; Valid and Binding Agreements. Finisar has the requisite
corporate power and authority to enter into and perform its obligations under this Agreement and
the Transaction Documents to which it is or will become a party. The execution, delivery and
performance of this Agreement and the other Transaction Documents to which Finisar is or will
become a party, and the consummation of the transactions contemplated hereby and thereby, have been
duly and validly authorized by all requisite corporate action, and no other proceedings on the part
of the Board of Directors of Finisar are necessary to authorize the execution, delivery and
performance of this Agreement and such other Transaction Documents and obligations thereunder.
This Agreement and the other Transaction Documents to which Finisar is a party have been duly
executed and delivered by Finisar, or upon the execution thereof, will be duly executed and
delivered by the same, and constitute or will constitute the valid and binding obligations of
Finisar, enforceable in accordance with their respective terms, except to the extent that
enforceability thereof may be limited by bankruptcy, insolvency, reorganization and other similar
laws affecting the enforcement of creditors’ rights generally and by general principles of equity.

          (C) No Breach. The execution, delivery and performance of this Agreement and the
other Transaction Documents to which Finisar is or will become a party and the consummation by
Finisar of the Transactions contemplated hereby and thereby, do not (i) conflict with or result in
any breach of any of the provisions of, constitute a default under, result in a violation of, or
result in the creation of a right of termination or acceleration of, the provisions of any material
Contract or Governmental Authorization by which Finisar is bound or affected, or any Encumbrance
upon any of the capital stock or assets of Finisar, (ii) conflict with or result in any breach of
any of the provisions of the Organizational Documents or duly adopted stockholder or director
resolution of Finisar, or (iii) conflict with or result in the violation of any Legal Requirement
to which Finisar, or any property held by Finisar is subject, or give any Governmental Body or
other Person the right to challenge any of the Transactions contemplated hereunder.

     3.5
Representations and Warranties of Finisar to Founder.

 Finisar represents and
warrants to Founder as follows, except as set forth in the Finisar Disclosure Letter:

          (A) Capitalization. The authorized capitalization of Finisar consists of Seven
Hundred Fifty Million (750,000,000) shares of $0.001 par value common stock and Five Million
(5,000,000) shares of $0.001 par value preferred stock. As of the date hereof, Finisar has issued
and outstanding Three Hundred Eight Million Six Hundred Thirty-two Thousand Three Hundred
Sixty-six (308,632,366) shares of common stock and no shares of preferred stock. The Finisar
Common Stock which will be issuable to the Founder upon conversion of the Convertible Notes in
accordance with their terms (a) will be duly authorized, validly issued, and fully paid and
non-

30

 

assessable, (b) will be offered, sold, issued and delivered in compliance with applicable
federal and state securities laws, and (c) will not be subject to, and will not be issued in
violation of, any preemptive rights created by statute, the Organizational Documents of Finisar or
any agreement to which Finisar is a party or by which Finisar is bound.

          (B) Governmental Authorizations; Consents. Except as provided in Part 3.5(B) of
Finisar’s Disclosure Letter and except for the filing of a registration statement on Form S-1
pursuant to the Securities Act of 1933, as amended (the “Securities Act”), with the Securities and
Exchange Commission (the “SEC”) to register the Finisar Common Stock issuable upon conversion of
the Convertible Notes and such consents, approvals, orders, authorizations, registrations,
declarations and filings as may be required under applicable federal and state securities laws, no
filing or registration with, or notification to, or other Governmental Authorization from any
Governmental Body or any other Person is required to be obtained, made or given by Finisar in
connection with its execution, delivery and performance of this Agreement, the other Transaction
Documents or the Transactions contemplated hereby or thereby.

          (C) SEC Documents. Except as described in the confidential disclosures delivered by
Finisar to Founder pursuant to that certain Confidentiality Agreement between Finisar and Founder
dated March 19, 2007 (the “Confidentiality Agreement”), Finisar has filed all required reports,
schedules, forms, statements and other documents that it has been required to file under the
Exchange Act and the Securities Act with the SEC since January 1, 1999 (the “SEC Documents”).

          (D) Litigation. Except as set forth in Part 3.5(D) of Finisar’s Disclosure Letter,
there is no Proceeding pending or, to Finisar’s Knowledge, Threatened, that questions the validity
of the Transaction Agreements or the right of Finisar to enter into them, or to consummate the
transactions contemplated by the Transaction Agreements.

          (E) Disclosure. No representation or warranty of Finisar in this Agreement and no
statement in the Finisar Disclosure Letter or any certificate required to be delivered by Finisar
hereunder omits to state a material fact necessary to make the statements herein or therein, in
light of the circumstances in which they were made, not misleading.

          (F) Absence of Certain Developments. Since March 5, 2007 there has been no Material
Adverse Effect with respect to Finisar.

          (G) Compliance With Legal Requirements; Governmental Authorizations.

               (i) Except as set forth in Part 3.5(G)(i) of Finisar’s Disclosure Letter:

                    (a) Finisar is in compliance in all respects with each Legal Requirement applicable to it or
to the conduct of its business or the ownership or use of any of its
assets except to the extent non-compliance would not have a Material Adverse Effect on
Finisar; and

                    (b) Finisar has not received any written notice from any

31

 

Governmental Body or any other Person
regarding any violation of, or failure to comply with, any Legal Requirement in any material
respect, which is outstanding or unresolved as of the date hereof.

               (ii) Finisar has all of the Governmental Authorizations necessary to permit it to lawfully
conduct and operate its businesses in the manner it currently conduct and operates such businesses
and to permit it to own and use its assets in the manner in which it currently owns and uses such
assets, except for such failure which would not have a Material Adverse Effect on Finisar.

ARTICLE IV.

Covenants Relating to Conduct of Business

     4.1 Conduct of Business.

          (A) Ordinary Course. During the period from the date of this Agreement to the
Closing, Founder shall cause AZNA to carry on its business in the Ordinary Course of Business and,
to the extent consistent therewith, use commercially reasonable efforts to preserve intact its
current business organization, keep available the services of its current officers and employees
and preserve its relationships with customers, suppliers, licensors, licensees, distributors and
others having business dealings with it. Without limiting the generality of the foregoing, without
the prior written consent of Finisar, during the period from the date of this Agreement to the
Closing, AZNA shall not:

               (i) declare, set aside or make any other distributions in respect of any of its Units or other
equity interests, (y) split, combine or reclassify any Units or other equity interests or issue or
authorize the issuance of any other securities in respect of, in lieu of or in substitution for
Units or other equity interests, or (z) purchase, redeem or otherwise acquire any of its Units or
other equity interests or any other securities thereof or any rights, warrants or options to
acquire any such shares or other securities;

               (ii) issue, deliver, sell, pledge or otherwise encumber any of its Units or other equity
interests, any other voting securities or any securities convertible into or exchangeable for, or
any rights, warrants or options to acquire, any such Units or other equity interests, voting
securities or convertible securities;

               (iii) amend its Organizational Documents;

               (iv) acquire or agree to acquire (x) by merging or consolidating with, or by purchasing a
substantial portion of the assets of, or by any other manner, any business or any corporation,
partnership, joint venture, association or other business organization or division
thereof, or (y) any assets that are material, individually or in the aggregate, to AZNA,
except purchases of inventory in the Ordinary Course of Business;

               (v) (a) grant to any employee, executive officer or director of AZNA any increase in
compensation, (b) grant to any employee, executive officer or director of AZNA any increase in
severance or termination pay, (c) enter into any employment, consulting,

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indemnification, severance
or termination agreement with any such employee, executive officer or director, (d) establish,
adopt, enter into or amend in any material respect any collective bargaining agreement or Plan,
except as otherwise provided for by Section 5.5 of this Agreement, or (e) take any action to
accelerate any material rights or benefits, or make any material determinations under any
collective bargaining agreement or Plan, except as otherwise required by applicable law or
regulation;

               (vi) make any change in accounting methods, principles or practices affecting the reported
consolidated assets, liabilities or results of operations of AZNA, except insofar as may have been
required by a change in GAAP or other applicable laws or regulations;

               (vii) sell, lease, mortgage or otherwise encumber or subject to any Encumbrance or otherwise
dispose of any properties or assets of AZNA having a fair market value in excess of $10,000;

               (viii) (a) incur any indebtedness for borrowed money or guarantee any such indebtedness of
another person, issue or sell any debt securities or warrants or other rights to acquire any debt
securities of AZNA, guarantee any debt securities of another Person, enter into any “keep well” or
other agreement to maintain any financial statement condition of another Person or enter into any
arrangement having the economic effect of any of the foregoing, or (b) make any loans, advances or
capital contributions to, or investments in, any other person, other than to AZNA;

               (ix) make or agree to make any new capital expenditure or expenditures which, in the
aggregate, are in excess of $10,000;

               (x) make any Tax election, amend any Tax Return or settle or compromise any Tax liability or
refund;

               (xi) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued,
asserted or unasserted, contingent or otherwise), other than those incurred in the Ordinary Course
of Business , or waive the benefits of, or agree to modify in any manner, any confidentiality,
standstill or similar agreement to which AZNA is a party;

               (xii) enter into any transaction, agreement, arrangement or understanding with any Affiliate;
or

               (xiii) authorize, commit or agree to take any of, the foregoing actions.

          (B) Other Actions. Neither AZNA nor any Seller shall take any action that would, or
that could reasonably be expected to, result in any of the representations and warranties of AZNA
or Sellers, respectively, set forth in this Agreement becoming untrue.

          (C) Continuation of Insurance. Founder shall cause AZNA to keep in effect until the
Closing all insurance policies to which AZNA is a party or that provides coverage to it as of the
date hereof.

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          (D) Advice of Proceedings. Founder shall promptly advise Finisar orally and in
writing if AZNA shall become subject to any Order or Proceeding or become aware of any Threatened
claim.

     4.2 No Negotiation or Solicitation. Until such time, if any, as this Agreement is
terminated pursuant to Article VII, AZNA and the Sellers shall not, and each will cause their
Representatives to not, directly or indirectly, solicit, initiate or encourage any inquires or
proposals from, discuss or negotiate with, or provide any non-public information to, any Person
(other than Finisar) relating to any transaction involving the sale of the business or the assets
(other than in the Ordinary Course of Business) of AZNA, or any of the Units or other equity
interests of AZNA, or any Transactions, consolidation, business combination, or similar transaction
involving the change in control of AZNA.

     4.3 Access to Information; Confidentiality.

          (A) Founder shall cause AZNA to afford to Finisar, and to Finisar’s officers, employees,
accountants, counsel, financial advisers and other Representatives, reasonable access during normal
business hours during the period prior to the Closing to all their respective properties, books,
contracts, commitments, personnel and records and, during such period, AZNA shall furnish promptly
to Finisar all other information concerning its business, properties and personnel as Finisar may
reasonably request. Finisar shall afford to AZNA and its officers, employees, accountants,
counsel, financial advisors and other Representatives, reasonable access during normal business
hours during the period prior to the Closing to all its properties, books, contracts, commitments,
personnel and records and, during such period, Finisar shall furnish promptly to AZNA all other
information governing its business, properties and personnel as AZNA may reasonably request.

          (B) Each party hereto will hold, and will use commercially reasonable efforts to cause its
Affiliates, and their respective Representatives to hold, in strict confidence from any Person,
unless (i) compelled to disclose by judicial or administrative process (including without
limitation in connection with obtaining the necessary approvals of this Agreement and the
transactions contemplated hereby of Governmental Bodies) or by other Legal Requirements or (ii)
disclosed in an action or proceeding brought by a party hereto in pursuit of its rights or in the
exercise of its remedies hereunder, all documents and information concerning the other party or any
of its Affiliates furnished to it by any other party or such other party’s Representatives in
connection with this Agreement or the transactions contemplated hereby, except to the extent
that such documents or information can be shown to have been (a) previously known by the party
receiving such documents or information, (b) in the public domain (either prior to or after the
furnishing of such documents or information hereunder) through no fault of such receiving party or
(c) later acquired by the receiving party from another source if the receiving party is not aware
that such source is under an obligation to another party hereto to keep such documents and
information confidential; provided, however, that following the Closing the
foregoing restrictions will not apply to Finisar or any of its Affiliates’ use of documents and
information concerning AZNA furnished by or on behalf of AZNA, the Sellers’ Representative or the
Sellers. After the Closing, the Sellers’ Representative and the Sellers will hold, and will use
their best efforts to cause their Affiliates to hold, in strict confidence from any Person all
information

34

 

regarding AZNA that is not now (and does not become part of, through no fault of the
Sellers’ Representative and the Sellers or its or their Affiliates) in the public domain. In the
event the transactions contemplated hereby are not consummated, upon the request of the other
party, each party hereto will, and will cause its Affiliates, to promptly (and in no event later
than five days after such request) redeliver or cause to be redelivered all copies of documents and
information furnished by the other party in connection with this Agreement or the transactions
contemplated hereby and destroy or cause to be destroyed all notes, memoranda, summaries, analysis,
compilations and other writings related thereto or based thereon prepared by the party that
furnished such documents and information.

ARTICLE V.

Additional Agreements

     5.1 Reasonable Efforts; Notification. Upon the terms and subject to the conditions set
forth in this Agreement, each of the parties agrees to use its commercially reasonable efforts to
take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and
cooperate with the other parties in doing, all things necessary, proper or advisable to consummate
and make effective, in the most expeditious manner practicable, the Transactions and the other
Transactions and to cause the conditions in Article VI to be satisfied.

     5.2 Fees and Expenses. Subject to Section 2.3 above, Finisar shall pay all reasonable
fees and expenses of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. and Gilmore, Rees, Carlson
& Cataldo, P.C. incurred or paid by or on behalf of Sellers relating to or arising in connection
with the negotiation and execution of this Agreement and the Transaction Agreements.

     5.3 Public Announcements. Finisar, on the one hand, and Sellers, on the other hand, will
not issue any press release or other public statements with respect to the Transactions without the
other parties’ prior written consent, except as may be required by applicable Legal Requirements,
court process or by obligations imposed by the Nasdaq Stock Market. The parties agree that Finisar
shall be entitled to prepare (in its sole discretion) and file reports on Form 8-K with the SEC
pursuant to the
Exchange Act concerning the announcement of the Transactions and a subsequent report on Form
8-K describing this Agreement and the Transactions and file any agreement as exhibits to such Form
8-K.

     5.4 Transfer Taxes. All transfer, documentary, sales, use, stamp, registration and other
such Taxes incurred in connection with this Agreement shall be paid by the Sellers when due, and
Sellers will, at their own expense, file all necessary Returns and other documentation with respect
to all such Taxes, and, if required by a Legal Requirement, Finisar will join in the execution of
any such Returns.

     5.5 Employment Matters.

          (A) Finisar reserves the right to request in writing that AZNA cease contributions to and/or
terminate one or more of the Plans immediately prior to the Closing so long as such cessation or
termination would not violate any notice requirements prescribed by

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any Legal Requirement;
provided, however, that such Plan terminations may be made contingent upon the
consummation of the Transactions.

          (B) AZNA shall pay prior to the Closing Date any costs, adjustments, or charges associated
with any termination, discontinuance, cancellation or liquidation of its portion of or interest in
any funding medium arising in connection with the actions described above.

          (C) After the Closing, the individuals who are employees of AZNA immediately prior to the
Closing who continue as employees of AZNA or Finisar after the Closing shall be provided with
salaries and employee benefits generally comparable to the salaries and employee benefits that they
each received from AZNA immediately prior to the Closing. AZNA hereby transfers and assigns to
Finisar, at and effective as of the Closing, all of AZNA’s right, title and interest in and to all
employment agreements to which AZNA is a party.

     5.6 Resignation of Directors and Officers. Founder will cause each of the officers and
directors of AZNA to resign as an officer and/or director of AZNA (and as a fiduciary under any
Plans), as applicable, effective at the Closing, which resignation shall include a release by such
officer or director of claims against AZNA (except claims arising out of compensation accrued but
not yet payable).

     5.7 Withholding Rights. Finisar and AZNA shall be entitled to deduct and withhold from
any of the payments to be made pursuant to this Agreement such amounts as may be required to be
deducted and withheld with respect to the making of such payment under the IRC of 1986, as amended,
or any provision of federal, state, local or foreign Legal Requirement with respect to Taxes. To
the extent that amounts are so withheld by Finisar or AZNA, such withheld amounts shall be treated
for all purposes of this Agreement as having been paid to the person to whom such amounts would
otherwise have been paid.

     5.8 FIRPTA Certificates. Either (i) Founder will deliver an affidavit, sworn under
penalties of perjury, stating that the AZNA is not and has never been a United States real property
holding corporation, dated as of the Closing Date and in form and substance required under Treasury
Regulation 1.897-2(h) or (ii) each Seller shall deliver to Finisar a non-foreign affidavit dated as
of the Closing Date, sworn under penalties of perjury and in form and substance required under the
Treasury Regulations issued pursuant to Section 1445 of the IRC stating that such Seller is not a
“Foreign Person” as defined in Section 1445 of the IRC.

     5.9 Enter into Transaction Agreements. Each party hereto shall enter into the Transaction
Agreements to which this Agreement contemplates it will become a party at or prior to the Closing.

     5.10 Securities Law Matters.

          (A) Finisar shall use reasonable efforts, beginning as soon as practicable after the Closing
Date, to cause the shares of Finisar Common Stock issuable upon conversion of the Convertible
Notes, subject to the terms and conditions thereof (collectively, the “Registrable Securities”), to
be registered under the Securities Act so as to permit the resale thereof, and in connection
therewith shall use its reasonable efforts to cause to become effective no later than

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nine (9)
months after the Closing Date, a registration statement (the “Registration Statement”) on Form S-1
or on such successor form as is then available under the Securities Act covering the Registrable
Securities; provided, however, that Founder shall provide all such information and materials and
take all such action as may reasonably be requested by Finisar in order to permit Finisar to comply
with all applicable requirements of the SEC and to obtain any desired acceleration of the effective
date of such Registration Statement. Such provision of information and materials is a condition
precedent to the obligations of Finisar pursuant to this Section 5.10(A). The offering made
pursuant to such registration shall not be underwritten.

          (B) Notwithstanding the foregoing, Finisar shall be entitled to postpone the filing or
declaration of effectiveness of the Registration Statement for a reasonable period of time not to
exceed ninety (90) calendar days after the deadlines therefore set forth in this Section 5.10, if
Finisar determines that there exists material nonpublic information about Finisar which would be
required by the Securities Act to be disclosed in the Registration Statement, the disclosure of
which, in the good faith determination of the Board of Directors of Finisar, would be detrimental
to Finisar.

          (C) Subject to the limitations of Section 5.10(B), Finisar shall use commercially reasonable
efforts to keep the Registration Statement effective until the earlier of such date as all
Registrable Securities then held by the Founder could be sold under Rule 144(k) or Rule 145 or such
date as all Registrable Securities have been sold by Founder (the “Registration Period”); (ii)
prepare and file with the SEC such amendments and supplements to the Registration Statement and the
prospectus used in connection therewith as may be necessary, and to comply with the provisions of
the Securities Act with respect to the sale or other
disposition of all securities proposed to be registered in the Registration Statement during
the Registration Period; and (iii) furnish to Founder such number of copies of any prospectus
(including any preliminary prospectus and any amended or supplemented prospectus) in conformity
with the requirements of the Securities Act, and such other documents, as the Founder may
reasonably request in order to effect the offering and sale of the Registrable Securities to be
offered and sold.

          (D) Finisar shall use its best efforts to (i) register and qualify the Registrable Securities
covered by the Registration Statement under the securities laws of such states as the Founder
reasonably requests, (ii) prepare and file in those states, such amendments (including
post-effective amendments) and supplements to such registrations and qualifications as may be
necessary to maintain the effectiveness thereof during the Registration Period, (iii) take such
other actions as may be necessary to maintain such registrations and qualifications in effect at
all times during the Registration Period, and (iv) take all other actions reasonably necessary or
advisable to qualify the Registrable Securities for sale in such states. Finisar shall promptly
notify the Founder of Finisar’s Knowledge of any notification with respect to the suspension of the
registration or qualification of any of the Registrable Securities for sale under the securities
laws of any states or the initiation or threat of any proceeding for such purpose and promptly use
commercially reasonable efforts to prevent such suspension or obtain its withdrawal if such
suspension occurs.

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          (E) As promptly as practicable after becoming aware of such event or development, Finisar
shall notify the Founder in writing of the happening of any event as a result of which the
prospectus included in the Registration Statement, as then in effect, includes an untrue statement
of a material fact or omission to state a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which they were made, not
misleading (provided that in no event shall such notice contain any material, nonpublic
information), and promptly prepare a supplement or amendment to the Registration Statement to
correct such untrue statement or omission. Finisar shall also promptly notify the Founder in
writing (i) when a prospectus or any prospectus supplement or post-effective amendment has been
filed, and when the Registration Statement or any post-effective amendment has become effective
(notification of such effectiveness shall be delivered to the Founder by facsimile on the same day
of such effectiveness), (ii) of any request by the SEC for amendments or supplements to the
Registration Statement or related prospectus or related information, (iii) of Finisar’s reasonable
determination that a post-effective amendment to the Registration Statement would be appropriate,
or (iv) when it obtains knowledge of the issuance of any stop order by the SEC suspending
effectiveness of the Registration Statement or the initiation or Threatened initiation of any
proceeding for that purpose, after which Finisar shall promptly use commercially reasonable efforts
to prevent the issuance of any stop order or to obtain its withdrawal.

          (F) In the event the number of shares available under the Registration Statement is
insufficient to cover all of the Registrable Securities, Finisar shall amend the Registration
Statement, or file a new Registration Statement, or both, so as to cover all of such Registrable
Securities as soon as practicable, but in any event not later than sixty (60) days after the
necessity therefor arises. Finisar shall use commercially reasonable efforts to cause such
amendment and/or new Registration Statement to become effective as soon as practicable
following the filing thereof. For purposes of the foregoing provision, the number of shares
available under the Registration Statement shall be deemed “insufficient to cover all of the
Registrable Securities” if at any time the number of Registrable Securities issuable during the
Registration Period is greater than the number of shares available for resale under such
Registration Statement.

          (G) Finisar will indemnify the Founder against all claims, losses, damages, liabilities and
expenses (or actions in respect thereof), including any of the foregoing incurred in settlement of
any litigation, commenced or threatened, and will promptly reimburse as incurred any legal or other
expenses reasonably incurred by Founder in connection with the investigation or defense of any
action, whether or not resulting in liability arising out of or based on any untrue statement (or
alleged untrue statement) of a material fact contained in any registration statement, prospectus,
preliminary prospectus, offering circular or other document, or any amendment or supplement
thereto, incident to any registration, qualification or compliance effected pursuant to this
Section 5.10, or based on any omission (or alleged omission) to state therein a material fact
required to be stated therein or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading, or any violation or any alleged violation by
Finisar of any rule or regulation promulgated under the Securities Act or the Exchange Act in
connection with any such registration, qualification or compliance, provided that Finisar will not
be liable in any such case to the extent that any such claim, loss, damage or

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liability arises out
of or is based on any untrue statement or omission or alleged untrue statement or omission, made in
reliance upon and in conformity with written information furnished to Finisar by the Founder and
specifically for use therein.

          (H) It shall be a condition to Finisar’s obligations hereunder to register the Registrable
Securities of the Founder that the Founder agree to indemnify Finisar, each of Finisar’s directors
and officers, each person who controls Finisar within the meaning of Section 15 of the Securities
Act, against all claims, losses, damages and liabilities (or actions in respect thereof) and
expenses arising out of or based on any untrue statement (or alleged untrue statement) of a
material fact contained in any such registration statement, prospectus, offering circular or other
document, or any omission (or alleged omission) to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement (or alleged untrue statement) or
omission (or alleged omission) is made in such registration statement, prospectus, offering
circular or other document in reliance upon and in conformity with written information furnished to
Finisar by the Founder specifically for use therein.

          (I) Each party entitled to indemnification under this Section 5.10 (the “Indemnified Party”)
shall give notice to the party required to provide indemnification (the “Indemnifying Party”)
promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may
be sought, and shall permit the Indemnifying Party to assume the defense of any such claim or any
litigation resulting therefrom, provided that counsel for the Indemnifying Party, who shall conduct
the defense of such claim or litigation, shall be approved by the Indemnified Party (whose approval
shall not unreasonably be withheld or delayed), and the Indemnified Party may participate in such
defense at such party’s expense; provided,
however, that an Indemnified Party (together with all other Indemnified Parties which may be
represented without conflict by one counsel) shall have the right to retain one separate counsel,
with the fees and expenses to be paid by the Indemnifying Party, if representation of such
Indemnified Party by the counsel retained by the Indemnifying Party would be inappropriate due to
differing or potentially differing interests between such Indemnified Party and any other party
represented by such counsel in such proceeding. The failure of any Indemnified Party to give
notice as provided herein shall not relieve the Indemnifying Party of its obligations under this
Section 5.10 unless the failure to give such notice is materially prejudicial to an Indemnifying
Party’s ability to defend such action. No Indemnifying Party, in the defense of any such claim or
litigation, shall, except with the consent of each Indemnified Party (which consent shall not be
unreasonably withheld or delayed), consent to entry of any judgment or enter into any settlement
which does not include as an unconditional term thereof the giving by the claimant or plaintiff to
such Indemnified Party of a release from all liability in respect to such claim or litigation.

          (J) All registration, filing and qualification fees, printing expenses, fees and disbursements
of legal counsel for Finisar, and expenses of any special audits and underwriters’ fees, discounts
or commissions, if any, incurred in connection with the registration of the Registrable Securities
pursuant to this Section 5.10, shall be paid by Finisar.

     5.11 Nasdaq Quotation. Finisar agrees to continue the quotation of Finisar Common
Stock on the Nasdaq National Market until one month after the conversion of the last shares of

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Finisar Common Stock held in the Escrow Fund. Finisar shall make such filings as are necessary, if
any, with the Nasdaq stock market regarding the transactions contemplated by this Agreement.

     5.12 Additional Contracts. Prior to the Closing, the Founder, on behalf of AZNA, was
pursuing certain new research and development proposals with the United States government, as
described in Exhibit F attached hereto (the “R&D Proposals”). Finisar and AZNA hereby
disclaim any interest in, and shall make no ownership claims with respect to, any government
contracts that arise out of the Research Proposals and that are granted or awarded after the
Closing to Founder or any corporation, partnership, limited liability company or other entity of
which Founder is then an owner, partner, shareholder, director, officer, employee or consultant
(“Other Entity”) (the “New Government Contracts”); provided, however, that neither Founder nor such
Other Entity shall infringe any Intellectual Property of AZNA in performing any New Government
Contracts or otherwise; and provided further, that Founder shall indemnify, defend and hold Finisar
and AZNA harmless from and against any and all liabilities of whatever kind or amount arising out
of or relating to such New Government Contracts.

ARTICLE VI.

Conditions Precedent

     6.1 Conditions to Each Party’s Obligation to Effect the Transactions. The respective
obligations of each party to effect the Transactions are subject to the satisfaction or waiver on
or prior to the Closing Date of the following conditions:

          (A) Required Approvals. Sellers shall have executed and delivered to Finisar the
Allocation Agreement and all consents and approvals required by AZNA’s Organizational Documents
shall have obtained.

          (B) No Injunctions or Restraints. No temporary restraining order, preliminary or
permanent injunction or other order issued by any court of competent jurisdiction or other legal
restraint or prohibition preventing the consummation of the Transactions shall be in effect.

          (C) No Litigation. Except for any suit, action or Proceeding relating to or arising
out of Finisar’s prior option grant practices, there shall not be pending or Threatened any suit,
action or Proceeding by any Governmental Body or any other Person, or before any court or
governmental authority, agency or tribunal, domestic or foreign, in each case that has a reasonable
likelihood of success (i) involving any challenge to, or seeking material damages or other relief
in connection with, any of the Transactions; or (ii) that may have the effect of preventing,
delaying, making illegal, or otherwise interfering with any of the Transactions.

     6.2 Conditions to Obligations of Finisar. The obligations of Finisar to effect the
Transactions are further subject to the following conditions:

          (A) Representations and Warranties. The representations and warranties of AZNA and
the Sellers contained in this Agreement shall be true and correct in all material respects, in each
case as of the date hereof and as of the Closing Date (except to the extent any of the same is
already qualified with respect to materiality or speaks as of a specific date, such as

40

 

the date
hereof, in which event such representation or warranty shall be required to be true and correct in
all material respects, as the case may be, as of such specified date), and Finisar shall have
received a certificate signed by Sellers’ Representative to such effect.

          (B) Performance of Obligations of AZNA and the Sellers. AZNA and the Sellers shall
have performed in all material respects all obligations required to be performed by them under this
Agreement at or prior to the Closing Date, and Finisar shall have received a certificate signed by
Sellers’ Representative to such effect.

          (C) Consents. All Consents required for the consummation of the Transactions
(including each Consent identified in the AZNA Disclosure Letter and each Consent identified in the
Finisar Disclosure Letter) and all filings and notifications necessary for the consummation of the
Transactions under any Legal Requirement must have been obtained or made and must be in full force
and effect on terms and conditions satisfactory to Finisar.

          (D) Opinion. Finisar shall have received a legal opinion from Mintz, Levin, Cohn,
Ferris, Glovsky and Popeo, P.C., counsel to Sellers, substantially in the form of Exhibit
G.

          (E) Escrow Agreement. Founder and Sellers’ Representative shall have executed and
delivered the Escrow Agreement.

          (F) Noncompetition Agreements. Founder and each key employee of AZNA listed on
Schedule II attached hereto shall have executed and delivered the Noncompetition,
Nonsolicitation and Nondisclosure Agreement, substantially in the form attached hereto as
Exhibit H.

          (G) Change. There shall not have been a Material Adverse Change in AZNA.

     6.3 Conditions to Obligation of Sellers. The obligation of Sellers to effect the
Transactions are subject to the following conditions:

          (A) Representations and Warranties. The representations and warranties of Finisar set
forth in this Agreement shall be true and correct, in all material respects, in each case as of the
date hereof and as of the Closing Date (except to the extent any of the same is already qualified
with respect to materiality or speaks as of a specific date, such as the date hereof, in which
event such representation or warranty will be correct in all respects and accurate as of such
date), and Sellers shall have received a certificate signed on behalf of Finisar to such effect.

          (B) Performance of Obligations of Finisar. Finisar shall have performed in all
material respects all obligations to be performed by it under this Agreement at or prior to the
Closing Date, and Sellers shall have received a certificate signed on behalf of Finisar to such
effect.

          (C) Opinion. Sellers shall have received a legal opinion from Wyatt, Tarrant & Combs,
LLP, counsel to Finisar, substantially in the form of Exhibit I.

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          (D) Consents. All Consents required for the consummation of the Transactions
(including each Consent identified in the AZNA Disclosure Letter and each Consent identified in the
Finisar Disclosure Letter) and all filings and notifications necessary for the consummation of the
Transactions under any Legal Requirement must have been obtained or made and must be in full force
and effect on terms and conditions satisfactory to Finisar.

          (E) Convertible Notes. Finisar shall have executed and delivered the Convertible
Notes.

          (F) Escrow Agreement. Finisar shall have executed and delivered the Escrow Agreement.

          (G) Change. There shall not have been a Material Adverse Change in Finisar and its
Subsidiaries.

ARTICLE VII.

Termination, Amendment and Waiver

     7.1 Termination. This Agreement may be terminated at any time prior to the Closing,
whether before or after approval of matters presented in connection with the Transactions by the
Sellers:

          (A) by mutual written consent of Finisar and Founder;

          (B) by either Finisar or Founder:

               (i) if the Transactions are not consummated on or before March 26, 2007 (the “Outside Date”),
unless the failure to consummate the Transactions is the result of a willful and material breach of
this Agreement by the party seeking to terminate this Agreement;

               (ii) if any Governmental Body issues an order, decree or ruling or takes any other action
permanently enjoining, restraining or otherwise prohibiting the Transactions and such order,
decree, ruling or other action shall have become final and non-appealable; or

               (iii) if any condition to the obligation of such party to consummate the Transactions set
forth in Section 6.1 or in Section 6.2 (in the case of Finisar) or Section 6.3 (in the case of
Sellers) becomes incapable of satisfaction prior to the Outside Date; provided,
however, that the terminating party is not then in willful and material breach of any
representation, warranty or covenant contained in this Agreement;

          (C) by Finisar, if AZNA or Sellers breach or fail to perform in any material respect any of
their representations, warranties or covenants contained in this Agreement, which breach or failure
to perform (i) would give rise to the failure of a condition set forth in Sections 6.2(A) or 6.2(B)
and (ii) cannot be or has not been cured within 30 days after the giving of

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written notice to AZNA
and Sellers of such breach (provided that Finisar is not then in willful and material breach of any
representation, warranty or covenant contained in this Agreement);

          (D) by Founder, if Finisar breaches or fails to perform in any material respect any of its
representations, warranties or covenants contained in this Agreement, which breach or failure to
perform (i) would give rise to the failure of a condition set forth in Section 6.3(A) or 6.3(B) and
(ii) cannot be or has not been cured within 30 days after the giving of
written notice to Finisar
of such breach (provided that Sellers are not then in willful and material breach of any
representation, warranty or covenant in this Agreement).

     7.2 Effect of Termination. In the event of termination of this Agreement by either
Founder or Finisar, as provided in Section 7.1, this Agreement shall forthwith become void and have
no effect, without any liability or obligation on the part of Finisar or the Sellers, other than
the provisions of the last sentence of Section 4.3(B), Section 5.3 and this Section 7.2 and except
to the extent that such termination results from the willful and material breach by a party hereof.

     7.3 Amendment. This Agreement may not be amended except by an instrument in writing signed on behalf of
each of the parties.

     7.4 Extension; Waiver. At any time prior to the Closing, the parties may (a) extend the
time for the performance of any of the obligations or other acts of the other parties, (b) waive
any inaccuracies in the representations and warranties contained in this Agreement or in any
document delivered pursuant to this Agreement, or (c) waive compliance with any of the agreements
or conditions contained in this Agreement. Any agreement on the part of a party to any such
extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf
of such party. The failure of any party to this Agreement to assert any of its rights under this
Agreement or otherwise shall not constitute a waiver of those rights.

     7.5 Procedure for Termination, Amendment, Extension or Waiver. A termination of this
Agreement pursuant to Section 7.1, an amendment of this Agreement pursuant to Section 7.3 or an
extension or waiver pursuant to Section 7.4 shall, in order to be effective, require action by the
duly authorized designee of the Board of Directors of the applicable party.

ARTICLE VIII.

General Provisions

     8.1 Notices. All notices, requests, claims, demands and other communications under this
Agreement shall be in writing and shall be deemed given if delivered personally or sent by
overnight courier (providing proof of delivery) to the parties at the following addresses (or at
such other address for a party as shall be specified by like notice):

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          (A)     if to Finisar, to

Finisar Corporation

1389 Moffett Park Drive

Sunnyvale, CA 94089-1133

Attention: Kurt Adzema

with a copy to:

Finisar Corporation

1389 Moffett Park Drive

Sunnyvale, CA 94089-1133

Attention: Gabe Kralik, Esq.

          (B)     if to Founder or Sellers’ Representative, to

Parviz Tayebati

2 Avery Street, 27E

Boston, MA 02111

with a copy to:

Mintz, Levin, Cohn, Ferris, Glovsky and Popeo,P.C.

One Financial Center

Boston, MA 02111

Fax: 617 542 2241

Attention: Stanley A. Twarog, Esq.

     8.2 Interpretation. When a reference is made in this Agreement to a Section,
Exhibit, the AZNA Disclosure Letter or the Finisar Disclosure Letter, such reference shall be to a
Section of, or an Exhibit, or the AZNA Disclosure Letter or the Finisar Disclosure Letter to, this
Agreement unless otherwise indicated. The table of contents and headings contained in this
Agreement are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Whenever the words “include,” “includes” or “including” are used
in this Agreement, they shall be deemed to be followed by the words “without limitation.”

     8.3 Counterparts. This Agreement may be executed in one or more counterparts and by
facsimile, all of which shall be considered one and the same agreement and shall become effective
when one or more counterparts have been signed by each of the parties and delivered to the other
parties.

     8.4 Entire Agreement; No Third-Party Beneficiaries. This Agreement, Exhibits, Schedules,
Disclosure Letters, Confidentiality Agreement and other agreements and instruments delivered in
connection herewith constitutes the entire agreement, and supersedes all prior agreements and
understandings, both written and oral,
among the parties with respect to the

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subject matter of the Transactions, to this Agreement.
No provision in this Agreement shall modify or amend any other agreement, plan, program, or
document unless this Agreement explicitly states that the provision “amends” that other agreement,
plan, program, or document. This shall not prevent the parties entitled to enforce this Agreement
from enforcing any provision in this Agreement, but no other party shall be entitled to enforce any
provision in this Agreement on the grounds that it is an amendment to another agreement, plan,
program, or document, unless the provision is explicitly designated as such in this Agreement, and
the Person is otherwise entitled to enforce the other agreement, plan, program, or document. If a
party not entitled to enforce this Agreement brings a lawsuit or other action to enforce any
provision in this Agreement as an amendment to another agreement, plan, program, or document, and
that provision is construed to be such an amendment despite not being explicitly designated as one
in this Agreement, that provision shall lapse retroactively as of its inception, thereby precluding
it from having any amendatory effect. 

     8.5 No Third-Party Beneficiaries. This Agreement shall be binding upon and inure solely
to the benefit of each of the parties and their respective successors and assigns, and nothing in
this Agreement, express or implied, is intended to or shall confer upon any other Person any legal
or equitable right, benefit or remedy of any nature under or by reason of this Agreement.

     8.6 Governing Law. This Agreement shall be governed by, and construed in accordance with,
the laws of the State of Delaware, regardless of the laws that might otherwise govern under
applicable principles of conflict of laws thereof.

     8.7 Submission to Jurisdiction. Each of the parties irrevocably agrees that any legal
action or proceeding arising out of or relating to this Agreement or for recognition and
enforcement of any judgment in respect hereof brought by the other party or its successors or
assigns may be brought and determined in any Federal or State court sitting in Santa Clara,
California, and each of the parties hereby irrevocably submits to the exclusive jurisdiction of the
aforesaid courts for itself and with respect to its property, generally and unconditionally, with
regard to any such action or proceeding arising out of or relating to this Agreement and the
transactions contemplated hereby (and agrees not to commence any action, suit or proceeding
relating thereto except in such courts). Each of the parties further agrees to accept service of
process in any manner permitted by such courts. Each of the parties hereby irrevocably and
unconditionally waives, and agrees not to assert, by way of motion or as a defense, counterclaim or
otherwise, in any action or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby, (a) any claim that it is not personally subject to the
jurisdiction of the above-named courts for any reason other than the failure lawfully to serve
process, (b) that it or its property is exempt or immune from jurisdiction of any such court or
from any legal process commenced in such courts (whether through service of notice, attachment
prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise)
and (c) to the fullest extent permitted by law, that (i) the suit, action or
proceeding in any such court is brought in an inconvenient forum, (ii) the venue of such suit,
action or proceeding is improper or (iii) this Agreement, or the subject matter hereof, may not be
enforced in or by such courts.

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     8.8 Assignment. Neither this Agreement nor any of the rights, interests or obligations
under this Agreement shall be assigned, in whole or in part, by operation of law or otherwise by
any of the parties without the prior written consent of the other parties. Any purported
assignment without such consent shall be void. Subject to the preceding sentences, this Agreement
will be binding upon, inure to the benefit of, and be enforceable by, the parties and their
respective successors and assigns.

     8.9 Enforcement. The parties agree that irreparable damage would occur in the event that
any of the provisions of this Agreement were not performed in accordance with their specific terms
or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an
injunctions to prevent breaches of this Agreement and to enforce specifically the terms and
provisions of this Agreement.

     8.10 Further Assurances. The parties agree (a) to furnish upon request to each other such
further information, (b) to execute and deliver to each other such other documents, and (c) to do
such other acts and things, all as the other party may reasonably request for the purpose of
carrying out this Agreement.

     8.11 Sellers’ Representative.

          (A) Each Seller, by execution of this Agreement, hereby appoints, effective immediately,
Parviz Tayebati, to act as such Seller’s representative hereunder (the “Sellers’ Representative”),
and by such Seller’s execution of this Agreement hereby appoints the Sellers’ Representative
(effective immediately) as such Seller’s true and lawful attorney, in such Seller’s name, place and
stead to act on such Seller’s behalf as contemplated by the terms of this Agreement (including,
without limitation, the execution and delivery of any waivers, consents, certificates (including
the certificates to be delivered at Closing pursuant to Section 6.2) approvals, extensions,
amendments and other agreements, the giving and receipt of notices, the resolution of disputes and
any matters or proceedings referred to in Article IX hereof) and hereby acknowledges that the
Sellers’ Representative shall be the only person authorized to take any action so required,
authorized or contemplated by this Agreement by any Seller. Each Seller further designates and
appoints the Sellers’ Representative as its agent for service of process with respect to any
disputes regarding or arising out of this Agreement or any of the transactions contemplated hereby.
Parviz Tayebati hereby accepts his appointment as the Sellers’ Representative and the
authorization set forth above. Sellers’ Representative shall serve in such
capacity until his resignation given by written notice not less than sixty (60) days prior to
the effective date thereof. In the event the Sellers’ Representative shall resign or otherwise
cease to act as Sellers’ Representative, the Sellers’ Representative shall be authorized to select
a replacement to serve as Sellers’ Representative, subject to the approval of the Sellers whose
percentage of the Purchase Price constitutes in the aggregate a majority of the total Purchase
Price allocated to the Common Unitholders and Common Optionholders. With the power of attorney so
granted by each Seller to the Sellers’ Representative, each Seller has authorized the Sellers’
Representative to take any further action which the Sellers’ Representative shall consider
necessary or desirable in connection with the foregoing, hereby giving the Sellers’ Representative
full power and authority to do and perform each and every act requisite as necessary to be done in
and about the foregoing as fully as such Seller might or could do if

46

 

personally present, and has
ratified and confirmed all that the Sellers’ Representative shall lawfully do or cause to be done
by virtue thereof. Following the effectiveness of the appointment of the Sellers’ Representative
under this Section 8.11, Finisar shall be entitled to rely on any action or inaction of the
Sellers’ Representative as the action or inaction of the appointing Sellers, any notice from any
such Seller to Finisar shall be delivered to Finisar solely by the Sellers’ Representative, and
Finisar shall be entitled to deliver all notices to any of the Sellers solely to the Sellers’
Representative.

          (B) By his, her or its approval and adoption of this Agreement, each Seller agrees that:

               (a) Finisar shall be able to rely conclusively on the instructions and decisions of the
Sellers’ Representative as to any actions required in connection with an indemnification claim by
Finisar under Article IX hereof that is in respect of a breach of a representation or warranty made
AZNA or by a Seller in Article III hereof;

               (b) the provisions of this Section 8.11 are independent and severable, are irrevocable and
coupled with an interest and shall be enforceable notwithstanding any rights or remedies that any
Seller may have in connection with the transactions contemplated by this Agreement; and

               (c) the provisions of this section 8.11 shall be binding upon the executors, heirs, legal
representatives, personal representatives, successor trustees and successors of each Seller, and
any references in this Agreement to a Seller shall mean and include the successors to the rights of
such Seller hereunder, whether pursuant to testamentary disposition, the laws of descent and
distribution or otherwise.

          (C) The Sellers’ Representative shall be entitled to rely, and shall be fully protected in
relying, upon any statements furnished to it by any Seller or Finisar, or any other evidence deemed
by the Sellers’ Representative to be reliable, and the Sellers’ Representative shall be entitled to
act on the advice of counsel selected by it as set forth in subsection below. The Sellers’
Representative shall be fully justified in failing or refusing to take any action under this
Agreement unless he or it shall have received such advice or concurrence of such Sellers as he or
it deems appropriate or he or it shall have been expressly indemnified to his or its satisfaction
by such Seller as he or it deems appropriate against any and all liability and expense
that such Sellers’ Representative may incur by reason of taking or continuing to take any such
action.

          (D) The Sellers’ Representative shall be entitled to retain counsel and to incur such expenses
as the Sellers’ Representative deems to be necessary or appropriate in connection with its
performance of its obligations under this Agreement, provided that all fees and expenses (including
reasonable attorneys’ fees and expenses) incurred by the Sellers’ Representative shall be borne by
the Sellers ratably according to the ratio of the percentage of each Seller to the aggregate
Purchase Price.

47

 

     8.12 Severability. Whenever possible, each provision or portion of any provision of this
Agreement shall be interpreted in such manner as to be effective and valid under applicable Law,
but if any provision or portion of any provision of this Agreement is held to be invalid, illegal
or unenforceable in any respect under any applicable Law or rule in any jurisdiction, such
invalidity, illegality or unenforceability shall not affect any other provision or portion of any
provision in such jurisdiction, and this Agreement shall be reformed, construed and enforced in
such jurisdiction as if such invalid, illegal or unenforceable provision or portion of any
provision had never been contained herein.

     8.13 Waiver of Jury Trial. EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING
TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

ARTICLE IX.

Indemnification; Remedies

     9.1 Survival; Right to Indemnification Not Affected By Knowledge. All representations,
warranties, covenants and obligations in this Agreement (including all representations, warranties,
covenants and obligations in the AZNA Disclosure Letter and Finisar Disclosure Letter and any other
certificate or document delivered pursuant to this Agreement) will survive the Closing, and shall
be unaffected by any investigation made by any of the parties hereto.

     9.2 Indemnification and Payment of Damages By Sellers. Subject to the provisions of this
Article IX, from and after the Closing, Sellers shall jointly and severally indemnify and hold
harmless Finisar, its Affiliates and their Representatives, stockholders and controlling persons
(collectively, the “Indemnified Persons”) for, and will pay to the Indemnified Persons the amount
of, any loss, liability, claim, damage or expense (including reasonable costs of investigation and
defense and reasonable attorneys’ fees), whether or not involving a third-party claim
(collectively, “Damages”), resulting from:

          (A) any breach of any representation or warranty made by AZNA in Section 3.1 of this
Agreement, the AZNA Disclosure Letter, or any other certificate or document delivered by AZNA
pursuant to this Agreement; or

          (B) any breach by AZNA of any covenant or agreement of AZNA in this Agreement.

     9.3 Indemnification and Payment of Damages By Founder and Common Unitholders and Common
Optionholders. Subject to the provisions of this Article IX, from and after the Closing,
Founder, each Common Optionholder and each Common Unitholder shall severally (and not jointly)
indemnify and hold harmless the Indemnified Persons for, and will pay to the Indemnified Persons
the amount of, any Damages resulting from:

          (A) any breach of any representation or warranty made by Founder in Section 3.2 or by such
Common Optionholder or such Unitholder in Section 3.3, of this Agreement,

48

 

respectively, or any
other certificate or document delivered by Founder or any such Common Optionholder or Unitholder
pursuant to this Agreement; or

          (B) any breach by Founder or any such Common Optionholder or Unitholder, respectively, of any
covenant or agreement of Founder or any such Common Optionholder or Unitholder in this Agreement.

     9.4 Indemnification and Payment of Damages by Finisar to Sellers. Subject to the
provisions of this Article IX, from and after the Closing, Finisar shall indemnify and hold
harmless Sellers and their Representatives (collectively, the “Seller Indemnified Persons”) for,
and will pay to the Seller Indemnified Persons the amount of any Damages, resulting from:

          (A) any breach of any representation or warranty made by Finisar in Section 3.4 of this
Agreement or any other certificate or document delivered by Finisar pursuant to this Agreement; or

          (B) any breach by Finisar of any covenant or agreement of Finisar in this Agreement.

     Notwithstanding the foregoing, after the Closing, Finisar shall have no obligation hereunder
to indemnify AZNA.

     9.5 Indemnification and Payment of Damages by Finisar to Founder. Subject to the
provisions of this Article IX, from and after the Closing, Finisar shall indemnify and hold
harmless Founder and his Representatives (collectively, the “Founder Indemnified Persons”) for, and
will pay to the Founder Indemnified Persons the amount of any Damages, resulting from:

          (A) any breach of any representation or warranty made by Finisar in Section 3.5 of this
Agreement, the Finisar Disclosure Letter, or any other certificate or document delivered by Finisar
pursuant to this Agreement.

     9.6 Time Limitation on Indemnification. If the Closing occurs, no claim for
indemnification pursuant to Section 9.2(A), Section 9.4(A) or Section 9.5(A) may be made unless on
or before the first (1st) anniversary of the Closing (the “Survival Period End Date”) the party
seeking indemnification notifies the indemnifying party in writing of a claim specifying the
factual basis of that claim in reasonable detail to the extent then known by the party making the
claim; provided, however, that the foregoing limitation shall not apply to any fraud or intentional
breach of a representation or warranty. Any claim for indemnification pursuant to Section 9.3(A)
that is based on a breach of Section 3.2 or 3.3 may be made at any time after the Closing and the
Survival Period End Date.

     9.7
Limitations on Amount - Sellers

The Sellers will have no liability with respect to
the matters described in Section 9.2(A) until the total of all Damages with respect to such matters
exceeds One Hundred Thousand Dollars ($100,000.00) (the “Basket”); at which point the Sellers shall
be liable for all Damages (and not just those in excess of the Basket), but in any event subject to
a maximum aggregate amount of the sum of the Escrow Cash and the Escrow Note (the “Cap”). The sole
and exclusive recourse of the Indemnified Person(s) for indemnification

49

 

and recovery of Damages
from the Sellers pursuant to Section 9.2(A) shall be the money or other property held by the Escrow
Agent pursuant to the Escrow Agreement; provided, that the Damages shall be satisfied first from
the Escrow Cash, up the full amount thereof, prior to any setoff against or application of, the
Escrow Note.

     Any claim for indemnification under Section 9.3(A) against Founder shall be made first against
the amount of Escrow Note held in the Escrow Fund, and if the Escrow Note is insufficient to
satisfy any such claim, the Indemnified Person(s) may make recourse to Founder directly for the
insufficiency. Any claim for indemnification under Section 9.3(A) against any Common Unitholder or
Optionholder shall be made first against the amount of Escrow Cash held in the Escrow Fund and
attributable to such Common Unitholder or Optionholder, respectively, in accordance with
Exhibit B, and if such amount is insufficient to satisfy any such claim, the Indemnified
Person(s) may make recourse to such Common Unitholder or Optionholder for the insufficiency.

     Notwithstanding the foregoing, the limits set forth in this Section 9.6 shall not apply to any
claim for indemnification pursuant to Section 9.2(B) or 9.3(B) or any fraud or intentional breach
by AZNA or Sellers of any representation or warranty made by AZNA or Sellers in this Agreement, the
AZNA Disclosure Letter or any other certificate or document delivered by AZNA or Sellers pursuant
to this Agreement.

     9.8
Limitations on Amount - Finisar. Finisar will have no liability with respect to the matters described in Section 9.4(A)
or Section 9.5(A) until the total of all Damages with respect to such matters exceeds the Basket;
at which point Finisar shall be liable for all Damages (and not just those in excess of the
Basket), but in any event subject to a maximum of the Cap. Any Damages payable by Finisar to the
Sellers pursuant to this Article IX shall be payable solely in cash. Notwithstanding the
foregoing, the limits set forth in this Section 9.8 will not apply to any claim for indemnification
pursuant to Section 9.4(B) or any fraud or any intentional breach by Finisar of any representation
or warranty made by Finisar in this Agreement, the Finisar Disclosure Letter, or any other
certificate or document delivered by Finisar pursuant to this Agreement.

     9.9
Procedure for Indemnification - Third Party Claims.

          (A) Promptly after receipt by an indemnified party under Section 9.2, Section 9.3, Section 9.4
or Section 9.5, as applicable, of notice of the commencement of any Proceeding against it, such
indemnified party will, if a claim is to be made against an indemnifying party under such section,
give notice to the indemnifying party of the commencement of such claim, but the failure to notify
the indemnifying party will not relieve the indemnifying party of any liability that it may have to
any indemnified party, except to the extent that the indemnifying party demonstrates that the
defense of such action is prejudiced by the indemnified party’s failure to give such notice.

          (B) If any Proceeding referred to in Section 9.9(A) is brought against an indemnified party
and it gives notice to the indemnifying party of the commencement of such Proceeding, the
indemnifying party will be entitled to participate in such Proceeding and, to the

50

 

extent that it
wishes (unless the indemnifying party is also a party to such Proceeding and the indemnified party
determines in good faith that joint representation would be inappropriate, or the indemnifying
party fails to provide reasonable assurance to the indemnified party of its financial capacity to
defend such Proceeding and provide indemnification with respect to such Proceeding, in which case
the indemnified party may retain its own counsel and be reimbursed for its expenses incurred in
connection therewith pursuant to this Article IX), to assume the defense of such Proceeding with
counsel reasonably satisfactory to the indemnified party and, after notice from the indemnifying
party to the indemnified party of its election to assume the defense of such Proceeding, the
indemnifying party will not, as long as it diligently conducts such defense, be liable to the
indemnified party under this Article IX for any fees of other counsel or any other expenses with
respect to the defense of such Proceeding, in each case subsequently incurred by the indemnified
party in connection with the defense of such Proceeding, other than reasonable costs of
investigation and except as provided above. If the indemnifying party assumes the defense of a
Proceeding, (i) it will be conclusively established for purposes of this Agreement that the claims
made in that Proceeding are within the scope of and subject to indemnification; (ii) no compromise
or settlement of such claims may be effected by the indemnifying party without the indemnified
party’s consent unless (A) there is no finding or admission of any violation of Legal Requirements
by an indemnified person and no effect on any other claims that may be made against the indemnified
party, and (B) the sole relief provided is monetary damages that are paid in full by or other
determination binding solely on the
indemnifying party; and (iii) the indemnified party will have no liability with respect to any
compromise or settlement of such claims effected without its consent. If notice is given to an
indemnifying party of the commencement of any Proceeding and the indemnifying party does not,
within thirty (30) days after the indemnified party’s notice is given (or such shorter period in
which indemnified party is required by any applicable Legal Requirement to respond to such
Proceeding), give notice to the indemnified party of its election to assume the defense of such
Proceeding, the indemnifying party will be bound by any determination made in such Proceeding or
any reasonable compromise or settlement effected by the indemnified party.

          (C) Notwithstanding the foregoing, if an indemnified party determines in good faith that there
is a reasonable probability that a Proceeding may adversely affect it or its Affiliates other than
as a result of monetary damages for which it would be entitled to indemnification under this
Agreement, the indemnified party may, by notice to the indemnifying party, assume the exclusive
right to defend, compromise, or settle such Proceeding, but the indemnifying party will not be
bound by any determination of a Proceeding so defended or any compromise or settlement effected
without its consent (which may not be unreasonably withheld).

     9.10
Procedure for Indemnification - Other Claims. A claim for indemnification for any
matter not involving a third-party claim may be asserted by notice to the party from whom
indemnification is sought.

     9.11 Escrow.

          (A) Subject to Sections 9.6 and 9.7 above, Finisar will be entitled to payment from the Escrow
Fund from time to time equal to the amount of Damages the Indemnified

51

 

Persons are entitled to
recover under this Article IX. Each claim asserted against Sellers or any of them pursuant to
Section 9.2 or Section 9.3 shall be made in accordance with the procedures set forth herein and in
the Escrow Agreement.

          (B) On the Survival Period End Date, the Escrow Note and Escrow Cash remaining in Escrow Fund
will be delivered to the Sellers’ Representative for distribution to the Sellers. If, however,
there are one or more claims or notices of claims pending or not fully satisfied on the Survival
Period End Date, the Escrow Note and Escrow Cash subject to such pending claims will remain in the
Escrow Fund until all such pending claims are determinable or are settled and all amounts due have
been paid in full, and the balance of the Escrow Note and Escrow Cash if any, remaining in the
Escrow Fund will be delivered to the Sellers’ Representative for distribution to the Sellers.

     9.12 Insurance and Tax Benefits. The amount of Damages subject to indemnification
under this Article IX shall be reduced by (i) the amount, if any, which the indemnified party
receives under any insurance policy with respect to such Damages and the indemnified party will, in
good faith, pursue claims for insurance proceeds to which it is entitled,
and (ii) the amount, if any, of the present value of any tax benefit which the indemnified
party may receive or otherwise enjoy with respect to the matter which gave rise to the Damages.

[END OF TEXT OF AGREEMENT]

52

 

     IN WITNESS WHEREOF, the undersigned hereby executes and delivers this counterpart
signature page to the Purchase Agreement by and among Finisar, AZNA, Founder and the Common
Unitholders and Common Optionholders, as of the date first written above.

	 	 	 	 	 
	 	 	“FINISAR”:
	 
	 	 	 	 
	 	 	FINISAR CORPORATION
	 
	 	 	 	 
	 

	 	By:
	 	/s/ S. K. Workman
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	Title:
	 	CFO
	 
	 	 	 	 
	 	 	“FOUNDER”:
	 
	 	 	 	 
	 	 	/s/ Parviz Tayebati
	 	 	 
	 	 	PARVIZ TAYEBATI
	 
	 	 	 	 
	 	 	“COMMON UNITHOLDERS” AND 
“COMMON OPTIONHOLDERS”:
	 
	 	 	 	 
	/s/ Daniel Mahgerefteh	 	/s/ K. McCallion
	 	 	 
	Daniel Mahgerefteh	 	K. McCallion
	 
	 	 	 	 
	/s/ Payam Tayebati	 	/s/ Y. Matsui
	 	 	 
	Payam Tayebati	 	Y. Matsui
	 
	 	 	 	 
	/s/ Z. Frank Fan	 	/s/ D. Walker
	 	 	 
	Z. Frank Fan	 	D. Walker
	 
	 	 	 	 
	/s/ G. Sun	 	/s/ M. Deutsch
	 	 	 
	G. Sun	 	M. Deutsch
	 
	 	 	 	 
	/s/ J. Kojongian	 	/s/ F. Sakhitab
	 	 	 
	J. Kojongian	 	F. Sakhitab
	 
	 	 	 	 
	/s/ Said Azemati	 	/s/ Roxanne Volpe
	 	 	 
	Said Azemati	 	Roxanne Volpe

 

 

	 	 	 	 	 
	/s/ Bartley Johnson	 	/s/ Carole Simon
	 	 	 
	Bartley Johnson	 	Carole Simon
	 
	 	 	 	 
	/s/ Michael Balfe	 	/s/ Dimitar Dimitrov
	 	 	 
	Michael Balfe	 	Dimitar Dimitrov
	 
	 	 	 	 
	/s/ Scott Burroughs	 	/s/ Parvin Tayebati
	 	 	 
	Scott Burroughs	 	Parvin Tayebati
	 
	 	 	 	 
	/s/ Chunlei Liao & Min Zhao	 	/s/ Fritz Strohkendl
	 	 	 
	Chunlei Liao & Min Zhao, JTWROS	 	Fritz Strohkendl
	 
	 	 	 	 
	/s/ Xueyan Zheng	 	/s/ Jianying Zhou
	 	 	 
	Xueyan Zheng	 	Jianying Zhou
	 
	 	 	 	 
	/s/ Michael Letsch	 	/s/ Hong Xiao
	 	 	 
	Michael Letsch	 	Hong Xiao
	 
	 	 	 	 
	/s/ Gilberto Salamanca	 	/s/ Edin Rovancin
	 	 	 
	Gilberto Salamanca	 	Edin Rovancin
	 
	 	 	 	 
	/s/ Maurice Yankanich	 	/s/ Mark Lykam
	 	 	 
	Maurice Yankanich	 	Mark Lykam
	 
	 	 	 	 
	/s/ Richard Schatz	 	/s/ Carl Umpleby
	 	 	 
	Richard Schatz	 	Carl Umpleby
	 
	 	 	 	 
	/s/ Harley Hammond	 	/s/ Junzuo Wan
	 	 	 
	Harley Hammond	 	Junzuo Wan
	 
	 	 	 	 
	/s/ Simon Cao
	 	 	 	 
	 

Simon Cao

	 	 	 	 
	 
	 	 	 	 
	 	 	“SELLERS’ REPRESENTATIVE”:
	 
	 	 	 	 
	 	 	/s/ Parviz Tayebati
	 	 	 
	 	 	Parviz Tayebati

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