Document:

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                                                                    Exhibit 10.1

                                 NEW FOCUS, INC.

                            INDEMNIFICATION AGREEMENT

         This Indemnification Agreement ("AGREEMENT") is entered into as of the
___ day of _________, 2000 by and between New Focus, Inc., a Delaware
corporation (the "COMPANY") and ______________ ("INDEMNITEE"), and shall become
effective as of the time the Securities and Exchange Commission declares
effective the Company's Registration Statement on Form S-1 relative to the
Company's initial underwritten public offering of Common Stock.

                                    RECITALS

         A. WHEREAS, the Company and Indemnitee recognize the significant
increases in the cost of liability insurance for its directors, officers,
employees, agents and fiduciaries.

         B. WHEREAS, the Company and Indemnitee further recognize the
substantial increase in corporate litigation in general, subjecting directors,
officers, employees, agents and fiduciaries to expensive litigation risks at the
same time as the availability and coverage of liability insurance has been
severely limited.

         B. WHEREAS, Indemnitee does not regard the current protection available
as adequate under the present circumstances, and Indemnitee and other directors,
officers, employees, agents and fiduciaries of the Company may not be willing to
continue to serve in such capacities without additional protection.

         C. WHEREAS, the Company desires to attract and retain the services of
highly qualified individuals, such as Indemnitee, to serve the Company and, in
part, in order to induce Indemnitee to continue to provide services to the
Company, wishes to provide for the indemnification and advancing of expenses to
the Indemnitee to the maximum extent permitted by law.

         D. WHEREAS, in view of the considerations set forth above, the Company
desires that Indemnitee be indemnified by the Company as set forth herein.

                                    RECITALS

         NOW, THEREFORE, in consideration of the mutual convenants and
agreements set forth herein and for other good and valuable consideration, the
receipt and adequacy of which is hereby acknowledged, the Company and Indemnitee
hereby agree as follows:

         1. Certain Definitions.

              (a) For purposes of this Agreement, references to the "COMPANY"
shall include, in addition to NEW FOCUS, INC., any constituent corporation
(including any constituent of a
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constituent) absorbed in a consolidation or merger to which NEW FOCUS, INC. (or
any of its wholly owned subsidiaries) is a party, if its separate existence had
continued, would have had power and authority to indemnify its directors,
officers, employees or agents, so that if Indemnitee is or was a director,
officer, employee or agent of such constituent corporation, or is or was serving
at the request of such constituent corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise, Indemnitee shall stand in the same position under the provisions of
this Agreement with respect to the resulting or surviving corporation as such
Indemnitee would have with respect to such constituent corporation if its
separate existence had continued.

              (b) For purposes of this Agreement, (i) references to "OTHER
ENTERPRISES" shall include employee benefit plans; (ii) references to "FINES"
shall include any excise taxes assessed on Indemnitee with respect to an
employee benefit plan; (iii) references to "SERVING AT THE REQUEST OF THE
COMPANY" shall include any service as a director, officer, employee or agent of
the Company which imposes duties on, or involves services by, such director,
officer, employee or agent with respect to an employee benefit plan, its
participants or its beneficiaries; and (iv) if Indemnitee acted in good faith
and in a manner Indemnitee reasonably believed to be in the interest of the
participants and beneficiaries of an employee benefit plan, Indemnitee shall be
deemed to have acted in a manner "NOT OPPOSED TO THE BEST INTERESTS OF THE
COMPANY" as referred to in this Agreement.

              (c) For purposes of this Agreement a "CHANGE IN CONTROL" shall be
deemed to have occurred if, on or after the date of this Agreement, (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended), other than a trustee or other fiduciary
holding securities under an employee benefit plan of the Company or a
corporation owned directly or indirectly by the stockholders of the Company in
substantially the same proportions as their ownership of stock of the Company,
is or becomes the "beneficial owner" (as defined in Rule 13d-3 under said Act),
directly or indirectly, of securities of the Company representing more than 50%
of the total voting power represented by the Company's then outstanding Voting
Securities, (ii) during any period of two consecutive years, individuals who at
the beginning of such period constitute the Board of Directors of the Company
and any new director whose election by the Board of Directors or nomination for
election by the Company's stockholders was approved by a vote of at least two
thirds (2/3) of the directors then still in office who either were directors at
the beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason to constitute a majority thereof,
or (iii) the stockholders of the Company approve a merger or consolidation of
the Company with any other corporation other than a merger or consolidation
which would result in the Voting Securities of the Company outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into Voting Securities of the surviving
entity) at least 80% of the total voting power represented by the Voting
Securities of the Company or such surviving entity outstanding immediately after
such merger or consolidation, or the stockholders of the Company approve a plan
of complete liquidation of the Company or an agreement for the sale or
disposition by the Company

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of (in one transaction or a series of related transactions) all or substantially
all of the Company's assets.

              (d) For purposes of this Agreement, "INDEPENDENT LEGAL COUNSEL"
shall mean an attorney or firm of attorneys, selected in accordance with the
provisions of Section 2(c) hereof, who shall not have otherwise performed
services for the Company or Indemnitees within the last three years (other than
with respect to matters concerning the rights of Indemnitees under this
Agreement, or of other indemnitees under similar indemnity agreements).

              (e) For purposes of this Agreement, a "REVIEWING PARTY" shall mean
the member or members of the Company's Board of Directors or any other body,
including a committee of the Board of Directors, appointed by the Board of
Directors who is not a party to the particular Claim for which Indemnitee are
seeking indemnification, or Independent Legal Counsel.

              (f) For purposes of this Agreement, "VOTING SECURITIES" shall mean
any securities of the Company that vote generally in the election of directors.

         2. Indemnification.

              (a) Indemnification of Expenses. The Company shall indemnify the
Indemnitee to the fullest extent permitted by applicable law, including, but not
limited to Section 145 of the General Corporation Law of the State of Delaware:

                   (i) if Indemnitee was or is or becomes a defendant, party to
or witness or other participant in, or is threatened to be made a defendant,
party to or witness or other participant in, any threatened, pending or
completed action, suit, proceeding or alternative dispute resolution mechanism,
or any hearing, inquiry or investigation that Indemnitee in good faith believes
might lead to the institution of any such action, suit, proceeding or
alternative dispute resolution mechanism, whether civil, criminal,
administrative, investigative or other (hereinafter a "CLAIM");

                   (ii) by reason of (or arising in part out of) any event or
occurrence related to the fact that Indemnitee is or was a director, officer,
employee, agent or fiduciary of the Company, or any subsidiary of the Company,
or is or was serving at the request of the Company as a director, officer,
employee, agent or fiduciary of another corporation, partnership, joint venture,
trust or other enterprise, or by reason of any action or inaction on the part of
Indemnitee while serving in such capacity (hereinafter an "INDEMNIFIABLE
EVENT");

                   (iii) against any and all expenses (including attorneys' fees
and all other costs, expenses and obligations incurred in connection with
investigating, defending, being a witness in or participating in (including on
appeal), or preparing to defend, be a witness in or participate in, any such
action, suit, proceeding, alternative dispute resolution mechanism, hearing,
inquiry or investigation), judgments, fines, penalties and amounts paid in
settlement (if such settlement is approved in advance by the Company, which
approval shall not be unreasonably withheld) of such

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Claim and any federal, state, local or foreign taxes imposed on Indemnitees as a
result of the actual or deemed receipt of any payments under this Agreement
(collectively, hereinafter "EXPENSES"), including all interest, assessments and
other charges paid or payable in connection with or in respect of such Expenses.

         Such payment of Expenses shall be made by the Company as soon as
practicable but in any event no later than twenty (20) days after written demand
by the Indemnitee therefor is presented to the Company.

              (b) Reviewing Party. Notwithstanding the foregoing,

                  (i) the obligations of the Company under Section 2(a) shall be
subject to the condition that the Reviewing Party (as described in Section 1(e)
hereof) shall not have determined (in a written opinion, in any case in which
the Independent Legal Counsel referred to in Section 2(c) hereof is involved)
that Indemnitee would not be permitted to be indemnified under applicable law
including, but not limited to Section 145 of the General Corporation Law of the
State of Delaware, because the Indemnitee has not met the applicable standard of
conduct as set forth in such applicable laws and

                  (ii) the obligation of the Company to make an advance payment
of Expenses to Indemnitee pursuant to Section 3(a) (an "EXPENSE ADVANCE") shall
be subject to the condition that, if, when and to the extent that the Reviewing
Party determines that Indemnitee would not be permitted to be so indemnified
under applicable law, including but not limited to Section 145 of the General
Corporation Law of the State of Delaware, the Company shall be entitled to be
reimbursed by Indemnitee (who hereby agree to reimburse the Company) for all
such amounts theretofore paid; provided, however, that if Indemnitee has
commenced or thereafter commence legal proceedings in a court of competent
jurisdiction to secure a determination that Indemnitee should be indemnified
under applicable law, any determination made by the Reviewing Party that
Indemnitee would not be permitted to be indemnified under applicable law shall
not be binding and Indemnitee shall not be required to reimburse the Company for
any Expense Advance until a final judicial determination is made with respect
thereto (as to which all rights of appeal therefrom have been exhausted or
lapsed).

         The Indemnitee's obligation to reimburse the Company for any Expense
Advance shall be unsecured and no interest shall be charged thereon. If there
has not been a Change in Control (as defined in Section 1(c) hereof), the
Reviewing Party shall be selected by the Board of Directors. If there has been
such a Change in Control (other than a Change in Control which has been approved
by a majority of the Company's Board of Directors who were directors immediately
prior to such Change in Control), the Reviewing Party shall be the Independent
Legal Counsel referred to in Section 2(c) hereof. If there has been no
determination by the

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Reviewing Party or if the Reviewing Party determines that Indemnitee
substantively would not be permitted to be indemnified in whole or in part under
applicable law, Indemnitee shall have the right to commence litigation seeking
an initial determination by the court or challenging any such determination by
the Reviewing Party or any aspect thereof, including the legal or factual bases
therefor, and the Company hereby consents to service of process and to appear in
any such proceeding. Absent such litigation, any determinations made by the
Reviewing Party shall be conclusive and binding on the Company and Indemnitee.

              (c) Selection of Independent Legal Counsel Upon a Change in
Control. The Company agrees that if there is a Change in Control of the Company
(other than a Change in Control which has been approved by a majority of the
Company's Board of Directors who were directors immediately prior to such Change
in Control) then, with respect to all matters thereafter arising concerning the
rights of Indemnitees to payments of Expenses and Expense Advances under this
Agreement or any other agreement or under the Company's Certificate of
Incorporation or Bylaws as now or hereafter in effect, Independent Legal Counsel
(as defined in Section 1(d) hereof) shall be selected by Indemnitees and
approved by the Company (which approval shall not be unreasonably withheld).
Such counsel, among other things, shall render its written opinion to the
Company and Indemnitee as to whether and to what extent Indemnitee would be
permitted to be indemnified under applicable law and the Company agrees to abide
by such opinion. The Company agrees to pay the reasonable fees and out-of-pocket
expenses of the Independent Legal Counsel referred to above and to fully
indemnify such counsel against any and all expenses (including attorneys' fees
and out-of-pocket expenses), claims, liabilities and damages arising out of or
relating to this Agreement or its engagement pursuant hereto.

              (d) Mandatory Indemnification. Notwithstanding any other provision
of this Agreement other than Section 10 hereof, to the extent that Indemnitee
has been successful on the merits or otherwise, including, without limitation,
the dismissal of an action without prejudice, in defense of any Claim referred
to in Section (2)(a) hereof, Indemnitee shall be indemnified against all
Expenses actually and reasonably incurred by such Indemnitee in connection
therewith.

         3. Expenses; Indemnification Procedure.

              (a) Advancement of Expenses. The Company shall advance all
Expenses incurred by Indemnitee. The advances to be made hereunder shall be paid
by the Company to Indemnitee as soon as practicable but in any event no later
than twenty (20) days after written demand by Indemnitee therefor to the
Company; provided, however, subject to such other limitations contained in
Section 2(b), above, that Indemnitee shall reimburse and repay all Expenses
advanced to Indemnitee pursuant to this Section 3(a) if it is ultimately
determined by the Reviewing Party (as described in Section 1(e) hereof) (or by
Independent Legal Counsel, as applicable) that the Indemnitee is not entitled to
be indemnified under the terms of this Agreement or under applicable law.

              (b) Notice/Cooperation by Indemnitee. Indemnitee shall, as a
condition precedent to Indemnitee's right to be indemnified under this
Agreement, give the Company notice in writing as soon as practicable but in no
event later than five (5) business days after Indemnitee's receipt of written
notice or complaint of any Claim made against Indemnitee for which
indemnification will or

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could be sought under this Agreement. Notice to the Company shall be directed to
the Chief Executive Officer of the Company at the address shown on the signature
page of this Agreement (or such other address as the Company shall designate in
writing to Indemnitee). In addition, Indemnitee shall give the Company such
information and cooperation as it may reasonably require and as shall be within
Indemnitee's power.

              (c) No Presumptions; Burden of Proof. For purposes of this
Agreement, the termination of any Claim by judgment, order, settlement (whether
with or without court approval) or conviction, or upon a plea of nolo
contendere, or its equivalent, shall not create a presumption that Indemnitee
did not meet any particular standard of conduct or have any particular belief or
that a court has determined that indemnification is not permitted by applicable
law. In addition, neither the failure of the Reviewing Party to have made a
determination as to whether Indemnitee has met any particular standard of
conduct or had any particular belief, nor an actual determination by the
Reviewing Party that Indemnitee has not met such standard of conduct or did not
have such belief, prior to the commencement of legal proceedings by Indemnitee
to secure a judicial determination that Indemnitee should be indemnified under
applicable law, shall be a defense to Indemnitee's claim or create a presumption
that Indemnitee has not met any particular standard of conduct or did not have
any particular belief. In connection with any determination by the Reviewing
Party or otherwise as to whether Indemnitee is entitled to be indemnified
hereunder, the burden of proof shall be on the Company to establish that
Indemnitee is not so entitled.

              (d) Notice to Insurers. If, at the time of the receipt by the
Company of a notice of a Claim pursuant to Section 3(b) hereof, the Company has
liability insurance in effect which may cover such Claim, the Company shall give
prompt notice of the commencement of such Claim to the insurers in accordance
with the procedures set forth in the respective policies. The Company shall
thereafter take all necessary or desirable action to cause such insurers to pay,
on behalf of Indemnitee, all amounts payable as a result of such action, suit,
proceeding, inquiry or investigation in accordance with the terms of such
policies.

              (e) Selection of Counsel. In the event the Company shall be
obligated hereunder to pay the Expenses of any Claim, the Company shall be
entitled to assume the defense of such Claim with counsel approved by
Indemnitee, which approval shall not be unreasonably withheld, upon the delivery
to Indemnitee of written notice of its election to do so. After delivery of such
notice, approval of such counsel by Indemnitee and the retention of such counsel
by the Company, the Company will not be liable to Indemnitee under this
Agreement for any fees of counsel subsequently incurred by Indemnitee with
respect to the same Claim; provided, however, that, (i) Indemnitee shall have
the right to employ Indemnitee's counsel in any such Claim at Indemnitee's
expense and (ii) if (A) the employment of counsel by Indemnitee has been
previously authorized by the Company, (B) Indemnitee shall have reasonably
concluded that there is a conflict of interest between the Company and
Indemnitee in the conduct of any such defense, or (C) the Company shall not
continue to retain such counsel to defend such Claim, then the fees and expenses
of Indemnitee's counsel shall be at the expense of the Company. The Company
shall have the right to conduct such

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defense as it sees fit in its sole discretion, including the right to settle any
claim against Indemnitee without the consent of the Indemnitee.

         4. Additional Indemnification Rights; Nonexclusivity.

              (a) Scope. The Company hereby agrees to indemnify Indemnitee to
the fullest extent permitted by law, notwithstanding that such indemnification
is not specifically authorized by the other provisions of this Agreement, the
Company's Certificate of Incorporation, the Company's Bylaws or by statute. In
the event of any change after the date of this Agreement in any applicable law,
statute or rule which expands the right of a Delaware corporation to indemnify a
member of its Board of Directors or an officer, employee, agent or fiduciary, it
is the intent of the parties hereto that Indemnitee shall enjoy by this
Agreement the greater benefits afforded by such change. In the event of any
change in any applicable law, statute or rule which narrows the right of a
Delaware corporation to indemnify a member of its Board of Directors or an
officer, employee, agent or fiduciary, such change, to the extent not otherwise
required by such law, statute or rule to be applied to this Agreement, shall
have no effect on this Agreement or the parties' rights and obligations
hereunder except as set forth in Section 9(a) hereof.

              (b) Nonexclusivity; Continuation of Rights After Ceasing Service
to the Company. The indemnification and advancement of Expenses provided by this
Agreement shall be in addition to any other rights to which Indemnitee may be
entitled under the Company's Certificate of Incorporation, its Bylaws, any
agreement, any vote of stockholders or disinterested directors, the General
Corporation Law of the State of Delaware, or otherwise. The indemnification and
advancement of Expenses provided under this Agreement shall continue as to
Indemnitee for any action Indemnitee took or did not take while serving in an
indemnified capacity even though Indemnitee may have ceased to serve in such
capacity and shall issue to the benefit of the heirs, executors and
administrators of such Indemnitee.

         5. No Duplication of Payments. The Company shall not be liable under
this Agreement to make any payment in connection with any Claim made against
Indemnitee to the extent Indemnitee has otherwise actually received payment
(under any insurance policy, Certificate of Incorporation, Bylaw or otherwise)
of the amounts otherwise indemnifiable hereunder.

         6. Partial Indemnification. If Indemnitee is entitled under any
provision of this Agreement to indemnification by the Company for some or a
portion of Expenses incurred in connection with any Claim, but not, however, for
all of the total amount thereof, the Company shall nevertheless indemnify
Indemnitee for the portion of such Expenses to which Indemnitee is entitled.

         7. Mutual Acknowledgement of Limitations or Indemnification. Both the
Company and Indemnitee acknowledge that in certain instances, Federal law or
applicable public policy may prohibit the Company from indemnifying its
directors, officers, employees, agents or fiduciaries under this Agreement or
otherwise. Indemnitee understands and acknowledges that the Company has
undertaken or may be required in the future to undertake with the Securities and
Exchange

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Commission to submit the question of indemnification to a court in certain
circumstances for a determination of the Company's right under public policy to
indemnify Indemnitee.

         8. Liability Insurance. The Company shall, from time to time, make the
good faith determination whether or not it is practicable for the Company to
obtain and maintain a policy or policies of insurance with reputable insurance
companies providing the officers and directors of the Company with coverage for
losses from wrongful acts, or to ensure the Company's performance of its
indemnification obligations under this Agreement. Among other considerations,
the Company will weigh the costs of obtaining such insurance coverage against
the protection afforded by such coverage. To the extent the Company maintains
liability insurance applicable to directors, officers or key employees,
Indemnitee shall be named as an insured in such a manner as to provide
Indemnitee the same rights and benefits as are accorded to the most favorably
insured of the Company's directors, if Indemnitee is a director; or of the
Company's officers, if Indemnitee is not a director of the Company but is an
officer; or of the Company's key employees, if Indemnitee is not an officer or
director but is a key employee. Notwithstanding the foregoing, the Company shall
have no obligation to obtain or maintain such insurance if the Company
determines in good faith that such insurance is not reasonably available, if the
premium costs for such insurance are disproportionate to the amount of coverage
provided, if the coverage provided by such insurance is limited by exclusions so
as to provide an insufficient benefit, or if Indemnitee is covered by similar
insurance maintained by a subsidiary or parent of the Company.

         9. Exceptions. Any other provision herein to the contrary
notwithstanding, the Company shall not be obligated pursuant to the terms of
this Agreement:

              (a) Excluded Acts or Omissions. (i) To indemnify Indemnitee for
Expenses resulting from acts, omissions or transactions for which Indemnitee is
prohibited from being indemnified under this Agreement or under applicable law
including, but not limited to, Sections 102(b)(7) and 145 of the General
Corporation Law of the State of Delaware or (ii) to indemnify the Indemnitee for
Indemnitee's intentional acts or transactions in violation of the Company's
policies;

              (b) Claims Initiated by Indemnitee. To indemnify or advance
expenses to Indemnitee with respect to Claims initiated or brought voluntarily
by Indemnitee and not by way of defense, except (i) with respect to actions or
proceedings brought to establish or enforce a right to indemnification under
this Agreement or any other agreement or insurance policy or under the Company's
Certificate of Incorporation or Bylaws now or hereafter in effect relating to
Claims for Indemnifiable Events, (ii) in specific cases if the Board of
Directors has approved the initiation or bringing of such Claim, or (iii) as
otherwise required under Section 145 of the Delaware General Corporation Law,
regardless of whether Indemnitee ultimately is determined to be entitled to such
indemnification, advance expense payment or insurance recovery, as the case may
be;

              (c) Lack of Good Faith. To indemnify Indemnitee for any expenses
incurred by Indemnitee with respect to any proceeding instituted by Indemnitee
to enforce or interpret this

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Agreement, if a court of competent jurisdiction determines that each of the
material assertions made by Indemnitee in such proceeding was not made in good
faith or was frivolous; or

              (d) Claims Under Section 16(b). To indemnify Indemnitee for
expenses and the payment of profits arising from the purchase and sale by
Indemnitee of securities in violation of Section 16(b) of the Securities
Exchange Act of 1934, as amended, or any similar successor statute.

         10. Period of Limitations. No legal action shall be brought and no
cause of action shall be asserted by or in the right of the Company against
Indemnitee, Indemnitee's estate, spouse, heirs, executors or personal or legal
representatives after the expiration of two years from the date of accrual of
such cause of action, and any claim or cause of action of the Company shall be
extinguished and deemed released unless asserted by the timely filing of a legal
action within such two-year period; provided, however, that if any shorter
period of limitations is otherwise applicable to any such cause of action, such
shorter period shall govern.

         11. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall constitute an original.

         12. Binding Effect; Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of and be enforceable by the parties
hereto and their respective successors, assigns, including any direct or
indirect successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business and/or assets of the Company, spouses, heirs,
and personal and legal representatives. The Company shall require and cause any
successor (whether direct or indirect by purchase, merger, consolidation or
otherwise) to all, substantially all, or a substantial part, of the business
and/or assets of the Company, by written agreement in form and substance
satisfactory to Indemnitee, expressly to assume and agree to perform this
Agreement in the same manner and to the same extent that the Company would be
required to perform if no such succession had taken place. This Agreement shall
continue in effect with respect to Claims relating to Indemnifiable Events
regardless of whether Indemnitee continues to serve as a director, officer,
employee, agent or fiduciary of the Company or of any other enterprise at the
Company's request.

         13. Attorneys' Fees. In the event that any action is instituted by
Indemnitee under this Agreement or under any liability insurance policies
maintained by the Company to enforce or interpret any of the terms hereof or
thereof, Indemnitee shall be entitled to be paid all expenses incurred by
Indemnitee with respect to such action, regardless of whether Indemnitee is
ultimately successful in such action, and shall be entitled to the advancement
of expenses with respect to such action, unless, as a part of such action, a
court of competent jurisdiction over such action determines that each of the
material assertions made by Indemnitee as a basis for such action was not made
in good faith or was frivolous. In the event of an action instituted by or in
the name of the Company under this Agreement to enforce or interpret any of the
terms of this Agreement, Indemnitee shall be entitled to be paid all expenses
incurred by Indemnitee in defense of such action (including costs and expenses
incurred with respect to Indemnitee's counterclaims and cross-claims made in
such action), and shall be entitled to the advancement of expenses with respect
to such action, unless, as a part of

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such action, a court having jurisdiction over such action determines that each
of Indemnitee's material defenses to such action was made in bad faith or was
frivolous.

         14. Notice. All notices and other communications required or permitted
under this Agreement shall be in writing, shall be effective when given, and
shall in any event be deemed to be given (a) five (5) days after deposit with
the U.S. Postal Service or other applicable postal service, if delivered by
first class mail, postage prepaid, (b) upon delivery, if delivered by hand, (c)
one business day after the business day of deposit with Federal Express or
similar overnight courier with delivery charges prepaid, or (d) on the same day
as delivered by facsimile transmission if delivered during business hours or
shall be deemed to have been delivered on the next successive business day if
delivered via facsimile transmission after business hours. All notices delivered
by the U.S. Postal Service, or by courier service shall be addressed if to
Indemnitee, at the Indemnitee's address as set forth beneath Indemnitee's
signature to this Agreement and if to the Company at the address of its
principal corporate offices (attention: Chief Executive Officer) or at such
other address as such party may designate by ten days' advance written notice to
the other party hereto.

         15. Consent to Jurisdiction. The Company and Indemnitee each hereby
irrevocably consent to the jurisdiction of the courts of the State of Delaware
for all purposes in connection with any action or proceeding which arises out of
or relates to this Agreement and agree that any action instituted under this
Agreement shall be commenced, prosecuted and continued only in the Court of
Chancery of the State of Delaware in and for New Castle County, which shall be
the exclusive and only proper forum for adjudicating such a claim.

         16. Severability. The provisions of this Agreement shall be severable
in the event that any of the provisions hereof (including any provision within a
single section, paragraph or sentence) are held by a court of competent
jurisdiction to be invalid, void or otherwise unenforceable, and the remaining
provisions shall remain enforceable to the fullest extent permitted by law.
Furthermore, to the fullest extent possible, the provisions of this Agreement
(including, without limitations, each portion of this Agreement containing any
provision held to be invalid, void or otherwise unenforceable, that is not
itself invalid, void or unenforceable) shall be construed so as to give effect
to the intent manifested by the provision held invalid, illegal or
unenforceable.

         17. Choice of Law. This Agreement shall be governed by and its
provisions construed and enforced in accordance with the laws of the State of
Delaware, as applied to contracts between Delaware residents, entered into and
to be performed entirely within the State of Delaware, without regard to the
conflict of laws principles thereof.

         18. Subrogation. In the event of payment under this Agreement, the
Company shall be subrogated to the extent of such payment to all of the rights
of recovery of Indemnitee who shall execute all documents required and shall do
all acts that may be necessary to secure such rights and to enable the Company
effectively to bring suit to enforce such rights.

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         19. Amendment and Termination. No amendment, modification, termination,
waiver, or cancellation of this Agreement shall be effective unless it is in
writing signed by both the parties hereto. No waiver of any of the provisions of
this Agreement shall be deemed or shall constitute a waiver of any other
provisions hereof (whether or not similar) nor shall such waiver constitute a
continuing waiver.

         20. Integration and Entire Agreement. This Agreement sets forth the
entire understanding between the parties hereto and supersedes and merges all
previous written and oral negotiations, commitments, understandings and
agreements relating to the subject matter hereof between the parties hereto.

         21. No Construction as Employment Agreement. Nothing contained in this
Agreement shall be construed as giving Indemnitee any right to be retained in
the employ of the Company or any of its subsidiaries.

                [Remainder of this Page Intentionally Left Blank]

                                      -11-
<PAGE>   12
         IN WITNESS WHEREOF, the parties hereto have executed this
Indemnification Agreement as of the date first above written.

                                        NEW FOCUS, INC.

                                        a Delaware corporation

                                        By:  __________________________________

                                        Name: _________________________________

                                        Address:    NEW FOCUS, INC.
                                                    2630 Walsh Avenue
                                                    Santa Clara, CA 95051

AGREED TO AND ACCEPTED BY:

___________________________

Address:

___________________________

___________________________

                                      -12-<PAGE>   1
                                                                    Exhibit 10.5

                                  AMENDMENT TO

                                 NEW FOCUS, INC.
                       NONSTATUTORY STOCK OPTION AGREEMENT

         This Amendment is made this ____ day of ______, 1999, by and between
New Focus, Inc. (the "Company") and _____________________ (the "Optionee"), and
is cumulative with respect to any prior amendments.

         WHEREAS, the Optionee was granted a stock option by the Company under
the 1990 Incentive Stock Plan (as amended May 4, 1998) and / or the 1999 Stock
Option Plan (collectively referred to as the "Plan") on __________________,
pursuant to the Plan and the Stock Option Agreement by and between the Company
and Optionee;

         WHEREAS, the Company and the Optionee desire to amend the Nonstatutory
Stock Option Agreement to provide for the early exercise of options, the ability
of Optionee to pay by promissory note, and to provide for the acceleration of
option vesting in certain circumstances within eighteen months following a
Change of Control.

         NOW, THEREFORE, the parties agree as follows:

         A. Section 3 of the Stock Option Agreement shall be amended in its
entirety to read as follows:

         " 3. Exercise of Option. This Option shall be exercisable during its
term in accordance with the provisions of Section 8 of the Plan as follows:

                  (a)      Right to Exercise

                           (i)      Subject to Subsections 3(a)(iii) and
                                    3(a)(iv) below, this Option shall be
                                    exercisable cumulatively according to the
                                    following vesting schedule: 12/60ths of the
                                    total number of Shares subject to this
                                    Option shall vest twelve months following
                                    the Vesting Commencement Date, and 1/60th of
                                    the total number of Shares subject to this
                                    Option shall vest thereafter on the monthly
                                    anniversary date of the Vesting Commencement
                                    Date. Alternatively, at the election of the
                                    Optionee, this Option may be exercised in
                                    whole or in part at any time as to any
                                    Shares (vested or unvested). Vested Shares
                                    shall not be subject to the Company's
                                    Repurchase Option as set forth in the
                                    Restricted Stock Purchase Agreement,
                                    attached hereto as Exhibit C- 1 (the
                                    "Repurchase Option").

                           (ii)     As a condition to exercising this Option for
                                    unvested Shares, the Optionee shall execute
                                    the Restricted Stock Purchase Agreement.
<PAGE>   2
                                    Unvested Shares shall be subject to the
                                    Company's Repurchase Option, which shall
                                    lapse at the same rate as the vesting
                                    schedule set forth in the first sentence of
                                    Section 3(a)(i), subject to accelerated
                                    vesting in certain circumstances within
                                    eighteen months following a Change of
                                    Control (as defined in Section 15 hereof).
                                    (iii) This Option may not be exercised for a
                                    fraction of a Share. (iv) In the event of
                                    Optionee's death, disability or other
                                    termination of employment, the
                                    exercisability of the Option is governed by
                                    Sections 8, 9, and 10 below."

         B. Section 5 of the Stock Option Agreement shall be amended in its
entirety to read as follows:

                  "5. Method of Payment. Payment of the purchase price shall be
made by any of the following, at the election of the Optionee:

                           (a)      cash;

                           (b)      check;

                           (c)      delivery of Optionee's promissory note (the
                                    "Note") in the form attached hereto as
                                    Exhibit B-1, in the amount of the purchase
                                    price plus any applicable federal, state, or
                                    local income taxes payable on account of the
                                    exercise of the Option, together with the
                                    execution and delivery by the Optionee of
                                    the Security Agreement attached hereto as
                                    Exhibit B-2. The note shall be secured by a
                                    pledge of the Shares purchased by the Note
                                    pursuant to the Security Agreement."

         C. Sections 13 and 14 shall be combined into a new Section 13 which
shall read in its entirety as follows:

         "13. Tax Consequences. Set forth below is a brief summary as of the
date of this Option of some of the federal tax consequences of exercise of this
Option and disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE,
AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE SHOULD
CONSULT A TAX ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.

                  (a) Exercise of Option. Upon the exercise of an NSO, Optionee
will recognize compensation income (taxable at ordinary income tax rates) equal
to the excess, if any, of the fair market value of the exercised Shares on the
date of exercise over the purchase price. If Optionee is an Employee or a former
Employee, the Company will be required to withhold from Optionee's compensation
or collect from Optionee and pay to the applicable taxing authorities an amount
in cash equal to a percentage of this compensation income at the time of
exercise, and may refuse to

                                      -2-
<PAGE>   3
honor the exercise and refuse to deliver Shares if such withholding amounts are
not delivered at the time of exercise.

                  (b) Disposition of Shares. If Shares are held for at least one
year, any gain realized on disposition of the Shares will be treated as
long-term capital gain for federal income tax purposes. Different rules may
apply if the Shares are subject to a substantial risk of forfeiture (within the
meaning of Section 83 of the Code) at the time of purchase.

                  (c) Section 83(b) Election for Unvested Shares Purchased
Pursuant to Options. With respect to the exercise of an Option for unvested
Shares, an election (the "Election") may be filed by the Optionee with the
Internal Revenue Service, within 30 days of the purchase of the Shares, electing
pursuant to Section 83(b) of the Code to be taxed currently on any difference
between the purchase price of the Shares and their fair market value on the date
of purchase. This will result in a recognition of taxable income to the Optionee
on the date of exercise, measured by the excess, if any, of the Fair Market
Value of the exercised Shares, at the time the Option is exercised over the
purchase price for the exercised Shares. Absent such an election, taxable income
will be measured and recognized by Optionee at the time or times on which the
Company's Repurchase Option lapses. Optionee is strongly encouraged to seek the
advice of his or her own tax consultants in connection with the purchase of the
Shares and the advisability of filing of the Election under Section 83(b) of the
Code. A form of Election under Section 83(b) is attached hereto as Exhibit C-5
for reference.

         OPTIONEE ACKNOWLEDGES THAT IT IS OPTIONEE'S SOLE RESPONSIBILITY AND NOT
THE COMPANY'S TO FILE TIMELY THE ELECTION UNDER SECTION 83(b), EVEN IF OPTIONEE
REQUESTS THE COMPANY OR ITS REPRESENTATIVE TO MAKE THIS FILING ON OPTIONEE'S
BEHALF."

         D. A new Section 15 entitled "Acceleration of Vesting Following a
Change of Control" shall be added to read as follows:

         "15. Acceleration of Vesting Following a Change of Control. If, within
eighteen (18) months following a Change of Control, Optionee's employment or
consulting relationship is terminated involuntarily by the Company other than
for Cause, death or disability or by the Optionee by a voluntary termination for
Good Reason, then 50% of the Optionee's unvested options shall vest. For
Purposes of the preceding sentence, the following definitions apply:

                  (a) "Cause" shall mean an Optionee's (i) willful act of
personal dishonesty, fraud or misrepresentation taken by the Optionee in
connection with his or her responsibilities as an employee which was intended to
result in gain or personal enrichment of the Optionee at the expense of the
Company; (ii) the Optionee's conviction of a felony; or (iii) the Optionee's
willful and continued failure to substantially perform his or her principal
duties and obligations of employment (other than any such failure resulting from
incapacity due to physical or mental illness), which failure is not remedied in
a reasonable period of time after receipt of written notice from the Company.
For the purposes of this Section, no act or failure to act shall be considered
"willful"

                                      -3-
<PAGE>   4
unless done or omitted to be done in bad faith and without reasonable belief
that the act or omission was in or not opposed to the best interests of the
Company.

                  (b) "Change of Control" means the occurrence of any of the
following events:

                         (i) The shareholders of the Company approve one of the
following:

                                    (A) Any consolidation, merger or plan of
exchange involving the Company pursuant to which all of the Company's common
stock would be converted into cash; or

                                    (B) Any sale, lease, exchange, or other
transfer (in one transaction or a series of related transactions) of all or
substantially all of the assets of the Company or the adoption of any plan or
proposal for the liquidation or dissolution of the Company; or

                         (ii) Any "person" (as such term is defined in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) becoming the
"beneficial owner" (as that term is defined in Rule 13d-3 under said Act)
directly or indirectly, of securities of the Company representing 50% or more of
the total voting power represented by the Company's then outstanding voting
securities; or

                         (iii) During any period of 12 months or less,
individuals who at the beginning of such period constituted a majority of the
Board of Directors cease for any reason to constitute a majority thereof unless
the nomination or election of such new directors was approved by a majority of
the directors then still in office who were directors at the beginning of such
period.

                  (c) "Good Reason" means

                         (i) A reduction of Optionee's title, duties, position,
responsibilities, or the removal of Optionee from such title, duties, position
or responsibilities other than a reduction directly attributable to a Change of
Control (as for example, when the Chief Executive Officer of the Company remains
as such following a Change of Control and is not made the Chief Executive
Officer of the acquiring corporation);

                         (ii) A reduction by the Company in the base salary of
the Executive other than a reduction directly attributable to a Change of
Control;

                         (iii) Without the Executive's express written consent,
the relocation of the Executive to a facility or a location more than fifty (50)
miles from the Executive's then present location other than a relocation
directly attributable to a Change of Control; or

                         (iv) Any purported termination of the Executive by the
Company which is not effected for Cause, or any purported termination for which
the grounds relied upon are not valid."

         E. The Exercise Notice, Investment Representation Statement, Note,
Security Agreement, Restricted Stock Purchase Agreement and related documents
attached to this

                                      -4-
<PAGE>   5
Amendment as Exhibits A through C-5 shall be incorporated as exhibits to the
Stock Option Agreement, hereby replacing any prior exhibits.

                                      -5-
<PAGE>   6
         IN WITNESS WHEREOF, this Amendment has been entered into as of the date
first set forth above.

         OPTIONEE                          NEW FOCUS, INC.

                                           ------------------------------------
         Signature                         By

                                           ------------------------------------
         Print Name                        Title

         Residence Address:

---------------------------

---------------------------

                                      -6-
<PAGE>   7
                                    EXHIBIT A

                                 EXERCISE NOTICE

New Focus, Inc.
2630 Walsh Avenue
Santa Clara, CA  95051-0905

Ladies and Gentlemen:

         The undersigned hereby elects to exercise the option indicated below
with respect to the number of shares of Common Stock of New Focus, Inc. (the
"Company") set forth:

Option Grant Date:  ______________________

Number of Shares Being Exercised:  __________ shares

Exercise Price Per Shares:  $__________

Total Exercise Price:  $__________

         Method of Payment:       / /              Cash

                                  / /              Check

                                  / /              Promissory Note

         Enclosed herewith is payment in full of the total exercise price or a
Promissory Note (if applicable), a copy of the Option Agreement, an executed
copy of an Investment Representation Statement (Exhibit B to the Option
Agreement), a Security Agreement (if applicable), and a Restricted Stock
Purchase Agreement.

         I understand and agree that the Company shall cause the legends set
forth below or legends substantially equivalent thereto, to be placed upon any
certificate(s) evidencing ownership of the Shares together with any other
legends that may be required by the Company or by state or federal securities
laws:

                  THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
                  UNDER THE SECURITIES ACT OF 1933 (THE "ACT") AND MAY NOT BE
                  OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR
                  HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR, IN
                  THE OPINION OF

<PAGE>   8
                  COMPANY COUNSEL SATISFACTORY TO THE ISSUER OF THESE
                  SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR
                  HYPOTHECATION IS IN COMPLIANCE THEREWITH.

                  THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
                  CERTAIN RESTRICTIONS ON TRANSFER AND RIGHT OF FIRST REFUSAL
                  OPTIONS HELD BY THE ISSUER OR ITS ASSIGNEE(S) AS SET FORTH IN
                  THE EXERCISE NOTICE BETWEEN THE ISSUER AND THE ORIGINAL HOLDER
                  OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE
                  PRINCIPAL OFFICE OF THE ISSUER. SUCH TRANSFER RESTRICTIONS AND
                  RIGHT OF FIRST REFUSAL ARE BINDING ON TRANSFEREES OF THESE
                  SHARES.

         I also agree that, in order to ensure compliance with the restrictions
referred to herein, the Company may issue appropriate "stop transfer"
instructions to its transfer agent, if any, and that, if the Company transfers
its own securities, it may make appropriate notations to the same effect in its
own records. The Company shall not be required (i) to transfer on its books any
Shares that have been sold or otherwise transferred in violation of any of the
provisions of this Exercise Notice or (ii) to treat as owner of such Shares or
to accord the right to vote or pay dividends to any purchaser or other
transferee to whom such Shares shall have been so transferred.

                                      -2-
<PAGE>   9
         My exact name, address and social security number for purposes of the
stock certificates to be issued and the shareholder list of the Company are:

         Name:
               ---------------------------------------
         Address:
                --------------------------------------

                --------------------------------------

         Social Security Number:
                                 ---------------------

                                              Sincerely,

---------------------                         --------------------------------
Dated:

                                      -3-
<PAGE>   10
                                   EXHIBIT B-1

                                      NOTE

$_________________________                             Santa Clara, California

                                                     __________________, _____

FOR VALUE RECEIVED, _____________________ ("Optionee") promises to pay to New
Focus, Inc., a California corporation (the "Company"), or order, the principal
sum of _______________________ ($_____________), without interest.

Principal shall be due and payable on _______________, _____ (the "Due Date").
Payment of principal shall be made in lawful money of the United States of
America.

The Optionee may at any time prepay all or any portion of the principal owing
hereunder.

This Note is subject to the terms of the Option, dated as of ________________.
This Note is secured by a pledge of the Company's Common Stock under the terms
of a Security Agreement of even date herewith and is subject to all the
provisions thereof.

The holder of this Note shall have full recourse against the undersigned, and
shall not be required to proceed against the collateral securing this Note in
the event of default.

In the event the Optionee ceases to be an employee or consultant of the Company,
this Note shall become due and fully payable within 60 days of such termination.
In the event the Optionee sells, exchanges, transfers, or otherwise disposes of
any Shares prior to the Due Date, the pro-rata portion of the total principal
payable under this Note which is attributable to such Shares shall become due
and fully payable within sixty (60) days of such sale, exchange, transfer or
disposition.

Should any action be instituted for the collection of this Note, the reasonable
costs and attorneys' fees therein of the holder shall be paid by the Optionee.

                                                 ______________________________

                                                 ______________________________
<PAGE>   11
                                   EXHIBIT B-2

                               SECURITY AGREEMENT

This Security Agreement is made as of __________, _____ between New Focus, Inc.,
a California corporation ("Pledgee"), and _________________________ ("Pledgor").

                                    Recitals

Pursuant to Pledgor's election to purchase Shares under the Option Agreement
dated ________ (the "Option"), between Pledgor and Pledgee under Pledgee's 1990
Incentive Stock Plan, and / or the 1999 Stock Option Plan, and Pledgor's
election under the terms of the Option to pay for such shares, with his
promissory note (the "Note"), Pledgor has purchased _________ shares of
Pledgee's Common Stock (the "Shares") at a price of $________ per share, for a
total purchase price of $__________. The Note and the obligations thereunder are
as set forth in Exhibit B-1 to the Option.

NOW, THEREFORE, it is agreed as follows:

         1. Creation and Description of Security Interest. In consideration of
the transfer of the Shares to Pledgor under the Option Agreement, Pledgor,
pursuant to the California Commercial Code, hereby pledges all of such Shares
(herein sometimes referred to as the "Collateral") represented by certificate
number ______, duly endorsed in blank or with executed stock powers, and
herewith delivers said certificate to the Secretary of Pledgee ("Pledgeholder"),
who shall hold said certificate subject to the terms and conditions of this
Security Agreement.

         The pledged stock (together with an executed blank stock assignment for
use in transferring all or a portion of the Shares to Pledgee if, as and when
required pursuant to this Security Agreement) shall be held by the Pledgeholder
as security for the repayment of the Note, and any extensions or renewals
thereof, to be executed by Pledgor pursuant to the terms of the Option, and the
Pledgeholder shall not encumber or dispose of such Shares except in accordance
with the provisions of this Security Agreement.

         2. Pledgor's Representations and Covenants. To induce Pledgee to enter
into this Security Agreement, Pledgor represents and covenants to Pledgee, its
successors and assigns, as follows:

               (a) Payment of Indebtedness. Pledgor will pay the principal sum
of the Note secured hereby, at the time and in the manner provided in the Note.

               (b) Encumbrances. The Shares are free of all other encumbrances,
defenses and liens, and Pledgor will not further encumber the Shares without the
prior written consent of Pledgee.

                                      -2-
<PAGE>   12
               (c) Margin Regulations. In the event that Pledgee's Common Stock
is now or later becomes margin-listed by the Federal Reserve Board and Pledgee
is classified as a "lender" within the meaning of the regulations under Part 207
of Title 12 of the Code of Federal Regulations ("Regulation U"), Pledgor agrees
to cooperate with Pledgee in making any amendments to the Note or providing any
additional collateral as may be necessary to comply with such regulations.

         3. Voting Rights. During the term of this pledge and so long as all
payments of principal is made as they become due under the terms of the Note,
Pledgor shall have the right to vote all of the Shares pledged hereunder.

         4. Stock Adjustments. In the event that during the term of the pledge
any stock dividend, reclassification, readjustment or other changes are declared
or made in the capital structure of Pledgee, all new, substituted and additional
shares or other securities issued by reason of any such change shall be
delivered to and held by the Pledgee under the terms of this Security Agreement
in the same manner as the Shares originally pledged hereunder. In the event of
substitution of such securities, Pledgor, Pledgee and Pledgeholder shall
cooperate and execute such documents as are reasonable so as to provide for the
substitution of such Collateral and, upon such substitution, references to
"Shares" in this Security Agreement shall include the substituted shares of
capital stock of Pledgor as a result thereof.

         5. Options and Rights. In the event that, during the term of this
pledge, subscription Options or other rights or options shall be issued in
connection with the pledged Shares, such rights, Options and options shall be
the property of Pledgor and, if exercised by Pledgor, all new stock or other
securities so acquired by Pledgor as it relates to the pledged Shares then held
by Pledgeholder shall be immediately delivered to Pledgeholder, to be held under
the terms of this Security Agreement in the same manner as the Shares pledged.

         6. Default. Pledgor shall be deemed to be in default of the Note and of
this Security Agreement in the event:

               (a) Payment of principal on the Note shall be delinquent for a
period of 10 days or more; or

               (b) Pledgor fails to perform any of the covenants set forth in
the Option or contained in this Security Agreement for a period of 10 days after
written notice thereof from Pledgee.

         In the case of an event of Default, as set forth above, Pledgee shall
have the right to accelerate payment of the Note upon notice to Pledgor, and
Pledgee shall thereafter be entitled to pursue its remedies under the California
Commercial Code.

         7. Release of Collateral. Subject to any applicable contrary rules
under Regulation G, there shall be released from this pledge a portion of the
pledged Shares held by Pledgeholder hereunder upon payments of the principal of
the Note. The number of the pledged Shares which shall be released shall be that
number of full Shares which bears the same proportion to the initial

                                      -3-
<PAGE>   13
number of Shares pledged hereunder as the payment of principal bears to the
initial full principal amount of the Note.

         8. Withdrawal or Substitution of Collateral. Pledgor shall not sell,
withdraw, pledge, substitute or otherwise dispose of all or any part of the
Collateral without the prior written consent of Pledgee.

         9. Term. The within pledge of Shares shall continue until the payment
of all indebtedness secured hereby, at which time the remaining pledged stock
shall be promptly delivered to Pledgor, subject to the provisions for prior
release of a portion of the Collateral as provided in paragraph 7 above.

         10. Insolvency. Pledgor agrees that if a bankruptcy or insolvency
proceeding is instituted by or against it, or if a receiver is appointed for the
property of Pledgor, or if Pledgor makes an assignment for the benefit of
creditors, the entire amount unpaid on the Note shall become immediately due and
payable, and Pledgee may proceed as provided in the case of default.

         11. Pledgeholder Liability. In the absence of willful or gross
negligence, Pledgeholder shall not be liable to any party for any of his acts,
or omissions to act, as Pledgeholder.

         12. Invalidity of Particular Provisions. Pledgor and Pledgee agree that
the enforceability or invalidity of any provision or provisions of this Security
Agreement shall not render any other provision or provisions herein contained
unenforceable or invalid.

         13. Successors or Assigns. Pledgor and Pledgee agree that all of the
terms of this Security Agreement shall be binding on their respective successors
and assigns, and that the term "Pledgor" and the term "Pledgee" as used herein
shall be deemed to include, for all purposes, the respective designees,
successors, assigns, heirs, executors and administrators.

         14. Governing Law. This Security Agreement shall be interpreted and
governed under the internal substantive laws, but not the choice of law rules,
of California.

                                      -4-
<PAGE>   14
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.

                                         "PLEDGOR"

                                         -------------------------------------
                                         Signature

                                         -------------------------------------
                                         Print Name

                                         Address:
                                                 -----------------------------

                                         -------------------------------------

                                         "PLEDGEE"
                                         NEW FOCUS, INC.
                                         a California corporation

                                         -------------------------------------
                                         Signature

                                         -------------------------------------
                                         Print Name

                                         -------------------------------------
                                         Title

                                         "PLEDGEHOLDER"

                                         -------------------------------------
                                         Secretary of New Focus, Inc.

                                      -5-
<PAGE>   15
                                   EXHIBIT C-1

                                 NEW FOCUS, INC.

                       RESTRICTED STOCK PURCHASE AGREEMENT

         THIS AGREEMENT is made between _____________________________ (the
"Purchaser") and New Focus, Inc. (the "Company") as of __________________, ____.

         Unless otherwise defined herein, the terms defined in the 1990
Incentive Stock Plan (as amended May 4, 1998) and / or the 1999 Stock Option
Plan, shall have the same defined meanings in this Agreement.

                                    RECITALS

         A. Pursuant to the exercise of the option (grant number ____) granted
to Purchaser under the Plan and pursuant to the Option Agreement dated
_______________, ____ by and between the Company and Purchaser with respect to
such grant (the "Option"), which Plan and Option Agreement are hereby
incorporated by reference, Purchaser has elected to purchase _________ of those
shares of Common Stock which have not become vested under the vesting schedule
set forth in the Option Agreement ("Unvested Shares"). The Unvested Shares and
the shares subject to the Option Agreement which have become vested are
sometimes collectively referred to herein as the "Shares."

         B. As required by the Option Agreement, as a condition to Purchaser's
election to exercise the option, Purchaser must execute this Agreement, which
sets forth the rights and obligations of the parties with respect to Shares
acquired upon exercise of the Option.

         1. Repurchase Option.

               (a) If Purchaser's status as a Service Provider is terminated for
any reason, including for cause, death, and Disability, the Company shall have
the right and option to purchase from Purchaser, or Purchaser's personal
representative, as the case may be, all of the Purchaser's Unvested Shares as of
the date of such termination at the price paid by the Purchaser for such Shares
(the "Repurchase Option").

               (b) Upon the occurrence of such termination, the Company may
exercise its Repurchase Option by delivering personally or by registered mail,
to Purchaser (or his transferee or legal representative, as the case may be),
within ninety (90) days of the termination, a notice in writing indicating the
Company's intention to exercise the Repurchase Option and setting forth a date
for closing not later than thirty (30) days from the mailing of such notice. The
closing shall take place at the Company's office. At the closing, the holder of
the certificates for the Unvested Shares being transferred shall deliver the
stock certificate or certificates evidencing the Unvested Shares, and the
Company shall deliver the purchase price therefor.
<PAGE>   16
               (c) At its option, the Company may elect to make payment for the
Unvested Shares to a bank selected by the Company. The Company shall avail
itself of this option by a notice in writing to Purchaser stating the name and
address of the bank, date of closing, and waiving the closing at the Company's
office.

               (d) If the Company does not elect to exercise the Repurchase
Option conferred above by giving the requisite notice within ninety (90) days
following the termination, the Repurchase Option shall terminate.

               (e) The Repurchase Option shall terminate in accordance with the
vesting schedule contained in Optionee's Option Agreement.

         2. Transferability of the Shares; Escrow.

               (a) Purchaser hereby authorizes and directs the Secretary of the
Company, or such other person designated by the Company, to transfer the
Unvested Shares as to which the Repurchase Option has been exercised from
Purchaser to the Company.

               (b) To insure the availability for delivery of Purchaser's
Unvested Shares upon repurchase by the Company pursuant to the Repurchase Option
under Section 1, Purchaser hereby appoints the Secretary, or any other person
designated by the Company as escrow agent, as its attorney-in-fact to sell,
assign and transfer unto the Company, such Unvested Shares, if any, repurchased
by the Company pursuant to the Repurchase Option and shall, upon execution of
this Agreement, deliver and deposit with the Secretary of the Company, or such
other person designated by the Company, the share certificates representing the
Unvested Shares, together with the stock assignment duly endorsed in blank,
attached hereto as Exhibit C-2. The Unvested Shares and stock assignment shall
be held by the secretary in escrow, pursuant to the Joint Escrow Instructions of
the Company and Purchaser attached as Exhibit C-3 hereto, until the Company
exercises its Repurchase Option, until such Unvested Shares are vested, or until
such time as this Agreement no longer is in effect. As a further condition to
the Company's obligations under this Agreement, the spouse of the Purchaser, if
any, shall execute and deliver to the Company the Consent of Spouse attached
hereto as Exhibit C-4. Upon vesting of the Unvested Shares, the escrow agent
shall promptly deliver to the Purchaser the certificate or certificates
representing such Shares in the escrow agent's possession belonging to the
Purchaser, and the escrow agent shall be discharged of all further obligations
hereunder; provided, however, that the escrow agent shall nevertheless retain
such certificate or certificates as escrow agent if so required pursuant to
other restrictions imposed pursuant to this Agreement.

               (c) The Company, or its designee, shall not be liable for any act
it may do or omit to do with respect to holding the Shares in escrow and while
acting in good faith and in the exercise of its judgment.

               (d) Transfer or sale of the Shares is subject to restrictions on
transfer imposed by any applicable state and federal securities laws. Any
transferee shall hold such Shares subject to all the provisions hereof and the
Exercise Notice executed by the Purchaser with respect to any

                                      -2-
<PAGE>   17
Unvested Shares purchased by Purchaser and shall acknowledge the same by signing
a copy of this Agreement.

         3. Ownership, Voting Rights, Duties. This Agreement shall not affect in
any way the ownership, voting rights or other rights or duties of Purchaser,
except as specifically provided herein.

         4. Legends. The share certificate evidencing the Shares issued
hereunder shall be endorsed with the following legend (in addition to any legend
required under applicable federal and state securities laws):

         THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
         RESTRICTIONS UPON TRANSFER AND RIGHTS OF REPURCHASE AS SET FORTH IN AN
         AGREEMENT BETWEEN THE COMPANY AND THE STOCKHOLDER, A COPY OF WHICH IS
         ON FILE WITH THE SECRETARY OF THE COMPANY.

         5. Adjustment for Stock Split. All references to the number of Shares
and the purchase price of the Shares in this Agreement shall be appropriately
adjusted to reflect any stock split, stock dividend or other change in the
Shares which may be made by the Company pursuant to Section 12 of the Plan after
the date of this Agreement.

         6. Notices. Notices required hereunder shall be given in person or by
registered mail to the address of Purchaser shown on the records of the Company,
and to the Company at their respective principal executive offices.

         7. Survival of Terms. This Agreement shall apply to and bind Purchaser
and the Company and their respective permitted assignees and transferees, heirs,
legatees, executors, administrators and legal successors.

         8. Section 83(b) Election. Purchaser hereby acknowledges that he or she
has been informed that, with respect to the exercise of an Option for Unvested
Shares, an election (the "Election") may be filed by the Purchaser with the
Internal Revenue Service, within 30 days of the purchase of the exercised
Shares, electing pursuant to Section 83(b) of the Code to be taxed currently on
any difference between the purchase price of the exercised Shares and their Fair
Market Value on the date of purchase. In the case of a Nonstatutory Stock
Option, this will result in a recognition of taxable income to the Purchaser on
the date of exercise, measured by the excess, if any, of the Fair Market Value
of the exercised Shares, at the time the Option is exercised over the purchase
price for the exercised Shares. Absent such an Election, taxable income will be
measured and recognized by Purchaser at the time or times on which the Company's
Repurchase Option lapses. In the case of an Incentive Stock Option, such an
Election will result in a recognition of income to the Purchaser for alternative
minimum tax purposes on the date of exercise, measured by the excess, if any, of
the Fair Market Value of the exercised Shares, at the time the option is
exercised, over the purchase price for the exercised Shares. Absent such an
Election, alternative minimum taxable income will be measured and recognized by
Purchaser at the time or times on which the Company's Repurchase Option lapses.
Purchaser is strongly encouraged to seek the advice of his or her own tax
consultants

                                      -3-
<PAGE>   18
in connection with the purchase of the Shares and the advisability of filing of
the Election under Section 83(b) of the Code. A form of Election under Section
83(b) is attached hereto as Exhibit C-5 for reference.

                  PURCHASER ACKNOWLEDGES THAT IT IS PURCHASER'S SOLE
RESPONSIBILITY AND NOT THE COMPANY'S TO FILE TIMELY THE ELECTION UNDER SECTION
83(b) OF THE CODE, EVEN IF PURCHASER REQUESTS THE COMPANY OR ITS REPRESENTATIVE
TO MAKE THIS FILING ON PURCHASER'S BEHALF.

         9. Representations. Purchaser has reviewed with his own tax advisors
the federal, state, local and foreign tax consequences of this investment and
the transactions contemplated by this Agreement. Purchaser is relying solely on
such advisors and not on any statements or representations of the Company or any
of its agents. Purchaser understands that he (and not the Company) shall be
responsible for his own tax liability that may arise as a result of this
investment or the transactions contemplated by this Agreement.

         10. Governing Law. This Agreement shall be governed by the internal
substantive laws, but not the choice of law rules, of California.

         Purchaser represents that he has read this Agreement and is familiar
with its terms and provisions. Purchaser hereby agrees to accept as binding,
conclusive and final all decisions or interpretations of the Board upon any
questions arising under this Agreement.

                                      -4-
<PAGE>   19
         IN WITNESS WHEREOF, this Agreement is deemed made as of the date first
set forth above.

OPTIONEE                                        NEW FOCUS, INC.

--------------------------------                -------------------------------
Signature                                       By

--------------------------------                -------------------------------
Print Name                                      Title

Residence Address:

--------------------------------

-------------------------------

Dated:
       --------------------------------

                                      -5-
<PAGE>   20
                                   EXHIBIT C-2

                      ASSIGNMENT SEPARATE FROM CERTIFICATE

         FOR VALUE RECEIVED I, __________________________, hereby sell, assign
and transfer unto New Focus, Inc. ______________________ (__________) shares of
the Common Stock of New Focus, Inc. standing in my name of the books of said
corporation represented by Certificate No. _____ herewith and do hereby
irrevocably constitute and appoint _______________ to transfer the said stock on
the books of the within named corporation with full power of substitution in the
premises.

         This Stock Assignment may be used only in accordance with the
Restricted Stock Purchase Agreement between New Focus, Inc. and the undersigned
dated ______________,

Dated: _______________,____              Signature: ___________________________

INSTRUCTIONS: Please do not fill in any blanks other than the signature line.
The purpose of this assignment is to enable the Company to exercise its
"repurchase option," as set forth in the Agreement, without requiring additional
signatures on the part of the Purchaser.
<PAGE>   21
                                   EXHIBIT C-3

                            JOINT ESCROW INSTRUCTIONS

Corporate Secretary
New Focus, Inc.
2630 Walsh Avenue
Santa Clara, CA  95051-0905

Dear Corporate Secretary:

         As Escrow Agent for both New Focus, Inc. (the "Company"), and the
undersigned purchaser of stock of the Company (the "Purchaser"), you are hereby
authorized and directed to hold the documents delivered to you pursuant to the
terms of that certain Restricted Stock Purchase Agreement (the "Agreement")
between the Company and the undersigned, in accordance with the following
instructions:

         1. In the event the Company and/or any assignee of the Company
(referred to collectively for convenience herein as the "Company") exercises the
Company's repurchase option set forth in the Agreement, the Company shall give
to Purchaser and you a written notice specifying the number of shares of stock
to be purchased, the purchase price, and the time for a closing hereunder at the
principal office of the Company. Purchaser and the Company hereby irrevocably
authorize and direct you to close the transaction contemplated by such notice in
accordance with the terms of said notice.

         2. At the closing, you are directed (a) to date the stock assignments
necessary for the transfer in question, (b) to fill in the number of shares
being transferred, and (c) to deliver the stock assignments, together with the
certificate evidencing the shares of stock to be transferred, to the Company or
its assignee, against the simultaneous delivery to you of the purchase price (by
cash, a check, or some combination thereof) for the number of shares of stock
being purchased pursuant to the exercise of the Company's repurchase option.

         3. Purchaser irrevocably authorizes the Company to deposit with you any
certificates evidencing shares of stock to be held by you hereunder and any
additions and substitutions to said shares as defined in the Agreement.
Purchaser does hereby irrevocably constitute and appoint you as Purchaser's
attorney-in-fact and agent for the term of this escrow to execute with respect
to such securities all documents necessary or appropriate to make such
securities negotiable and to complete any transaction herein contemplated,
including but not limited to the filing with any applicable state blue sky
authority of any required applications for consent to, or notice of transfer of,
the securities. Subject to the provisions of this paragraph 3, Purchaser shall
exercise all rights and privileges of a stockholder of the Company while the
stock is held by you.
<PAGE>   22
         4. Upon written request of the Purchaser, but no more than once per
calendar year, unless the Company's repurchase option has been exercised, you
will deliver to Purchaser a certificate or certificates representing so many
shares of stock as are not then subject to the Company's repurchase option.
Within 120 days after cessation of Purchaser's continuous employment by or
services to the Company, or any parent or subsidiary of the Company, you will
deliver to Purchaser a certificate or certificates representing the aggregate
number of shares held or issued pursuant to the Agreement and not purchased by
the Company or its assignees pursuant to exercise of the Company's repurchase
option.

         5. If at the time of termination of this escrow you should have in your
possession any documents, securities, or other property belonging to Purchaser,
you shall deliver all of the same to Purchaser and shall be discharged of all
further obligations hereunder.

         6. Your duties hereunder may be altered, amended, modified or revoked
only by a writing signed by all of the parties hereto.

         7. You shall be obligated only for the performance of such duties as
are specifically set forth herein and may rely and shall be protected in relying
or refraining from acting on any instrument reasonably believed by you to be
genuine and to have been signed or presented by the proper party or parties. You
shall not be personally liable for any act you may do or omit to do hereunder as
Escrow Agent or as attorney-in-fact for Purchaser while acting in good faith,
and any act done or omitted by you pursuant to the advice of your own attorneys
shall be conclusive evidence of such good faith.

         8. You are hereby expressly authorized to disregard any and all
warnings given by any of the parties hereto or by any other person or
corporation, excepting only orders or process of courts of law and are hereby
expressly authorized to comply with and obey orders, judgments or decrees of any
court. In case you obey or comply with any such order, judgment or decree, you
shall not be liable to any of the parties hereto or to any other person, firm or
corporation by reason of such compliance, notwithstanding any such order,
judgment or decree being subsequently reversed, modified, annulled, set aside,
vacated or found to have been entered without jurisdiction.

         9. You shall not be liable in any respect on account of the identity,
authorities or rights of the parties executing or delivering or purporting to
execute or deliver the Agreement or any documents or papers deposited or called
for hereunder.

         10. You shall not be liable for the outlawing of any rights under the
Statute of Limitations with respect to these Joint Escrow Instructions or any
documents deposited with you.

         11. You shall be entitled to employ such legal counsel and other
experts as you may deem necessary properly to advise you in connection with your
obligations hereunder, may rely upon the advice of such counsel, and may pay
such counsel reasonable compensation therefor.

                                      -2-
<PAGE>   23
         12. Your responsibilities as Escrow Agent hereunder shall terminate if
you shall cease to be an officer or agent of the Company or if you shall resign
by written notice to each party. In the event of any such termination, the
Company shall appoint a successor Escrow Agent.

         13. If you reasonably require other or further instruments in
connection with these Joint Escrow Instructions or obligations in respect
hereto, the necessary parties hereto shall join in furnishing such instruments.

         14. It is understood and agreed that should any dispute arise with
respect to the delivery and/or ownership or right of possession of the
securities held by you hereunder, you are authorized and directed to retain in
your possession without liability to anyone all or any part of said securities
until such disputes shall have been settled either by mutual written agreement
of the parties concerned or by a final order, decree or judgment of a court of
competent jurisdiction after the time for appeal has expired and no appeal has
been perfected, but you shall be under no duty whatsoever to institute or defend
any such proceedings.

         15. Any notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given upon personal delivery or upon
deposit in the United States Post Office, by registered or certified mail with
postage and fees prepaid, addressed to each of the other parties thereunto
entitled at the following addresses or at such other addresses as a party may
designate by ten days' advance written notice to each of the other parties
hereto.

         16. By signing these Joint Escrow Instructions, you become a party
hereto only for the purpose of said Joint Escrow Instructions; you do not become
a party to the Agreement.

         17. This instrument shall be binding upon and inure to the benefit of
the parties hereto, and their respective successors and permitted assigns.

         18. These Joint Escrow Instructions shall be governed by the internal
substantive laws, but not the choice of law rules, of California.

PURCHASER                                       NEW FOCUS, INC.

--------------------------------                -------------------------------
Signature                                       By

--------------------------------                -------------------------------
Print Name                                      Title

Residence Address:

--------------------------------

--------------------------------

                                      -3-
<PAGE>   24
ESCROW AGENT

Corporate Secretary

Dated:
       ---------------------------

                                      -4-
<PAGE>   25
                                   EXHIBIT C-4

                                CONSENT OF SPOUSE

         I, ____________________, spouse of ___________________, have read and
approve the foregoing Restricted Stock Purchase Agreement (the "Agreement"). In
consideration of granting of the right to my spouse to purchase shares of
____________________________, as set forth in the Agreement, I hereby appoint my
spouse as my attorney-in-fact in respect to the exercise of any rights under the
Agreement and agree to be bound by the provisions of the Agreement insofar as I
may have any rights in said Agreement or any shares issued pursuant thereto
under the community property laws or similar laws relating to marital property
in effect in the state of our residence as of the date of the signing of the
foregoing Agreement.

Dated: ___________________,_____       Signature: ______________________________
<PAGE>   26
                                   EXHIBIT C-5

                          ELECTION UNDER SECTION 83(B)
                      OF THE INTERNAL REVENUE CODE OF 1986

The undersigned taxpayer hereby elects, pursuant to Section 83(b) of the
Internal Revenue Code of 1986, as amended, to include in taxpayer's gross income
for the current taxable year the amount of any compensation taxable to taxpayer
in connection with taxpayer's receipt of the property described below:
1. The name, address, taxpayer identification number and taxable year of the
undersigned are as follows:

   NAME:                         TAXPAYER:                 SPOUSE:

   ADDRESS:

   IDENTIFICATION NO.:           TAXPAYER:                 SPOUSE:

   TAXABLE YEAR:

2.       The property with respect to which the election is made is described as
         follows: __________ shares (the "Shares") of the Common Stock of New
         Focus, Inc. (the "Company").

3.       The date on which the property was transferred is:___________________
         ,______.

4.       The property is subject to the following restrictions:

         The Shares may not be transferred and are subject to forfeiture under
         the terms of an agreement between the taxpayer and the Company. These
         restrictions lapse upon the satisfaction of certain conditions
         contained in such agreement.

5.       The fair market value at the time of transfer, determined without
         regard to any restriction other than a restriction which by its terms
         will never lapse, of such property is: $_________________.

6.       The amount (if any) paid for such property is: $_________________.

The undersigned has submitted a copy of this statement to the person for whom
the services were performed in connection with the undersigned's receipt of the
above-described property. The transferee of such property is the person
performing the services in connection with the transfer of said property.

The undersigned understands that the foregoing election may not be revoked
except with the consent of the Commissioner.

Dated: ______________________, _____        ___________________________________
                                            Taxpayer

The undersigned spouse of taxpayer joins in this election.

Dated: _____________________, ______        ___________________________________
                                            Spouse of Taxpayer

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