Exhibit 4.1
FINISAR CORPORATION
CERTIFICATE OF DESIGNATION OF PREFERENCES AND RIGHTS
OF THE
SERIES A PREFERRED STOCK
(Pursuant to Section 151 of the General Corporation Law of the State of
Delaware)
The undersigned Stephen K. Workman, Vice President of Finance, Chief
Financial Officer and Secretary of Finisar Corporation, a corporation organized
and existing under the General Corporation Law of the State of Delaware (the
"Corporation"), in accordance with the provisions of Section 103 thereof, DOES
HEREBY CERTIFY:
That pursuant to the authority conferred upon the Board of Directors by the
Restated Certificate of Incorporation of the Corporation, filed with the
Secretary of State of the State of Delaware on November 15, 1999 (the "Restated
Certificate of Incorporation"), the Board of Directors on February 16, 2001
adopted the following resolution creating a series of 3,250,000 shares of
Preferred Stock designated as Series A Preferred Stock:
"RESOLVED, that pursuant to the authority vested in the Board of Directors
of the Corporation in accordance with the provisions of its Restated Certificate
of Incorporation, a series of Preferred Stock of the Corporation be and it
hereby is created, and that the designation and amount thereof and the powers,
preferences and relative, participating, optional and other special rights of
the shares of such series, and the qualifications, limitations or restrictions
thereof are as follows:
1. DESIGNATION AND AMOUNT.
The initial series of Preferred Stock shall be designated Series A
Preferred Stock, par value $.001 per share (the "Series A Preferred Stock"). The
number of shares initially constituting the Series A Preferred Stock shall be
three million two hundred fifty thousand (3,250,000) shares.
2. DIVIDENDS.
The holders of the Series A Preferred Stock shall be entitled to receive
when, as and if declared by the Board of Directors, out of any assets legally
available therefor, dividends (other than dividends of Common Stock for which an
adjustment is made pursuant Section 5(c)(i))on a pari passu basis with the
holders of the Common Stock, with each share of the Series A Preferred Stock
being deemed, for such purpose, to be equal to the number of shares of Common
Stock, including fractions of a share, into which such share of Series A
Preferred Stock is convertible immediately prior to the close of business on the
business day fixed for such dividend or distribution.
3. LIQUIDATION.
(a) LIQUIDATION DEFINED. "Liquidation" means any voluntary or involuntary
liquidation, dissolution or winding up of the affairs of the Corporation, other
than any dissolution, liquidation or winding up in connection with any
reincorporation of the Corporation in another jurisdiction. For purposes of this
Section 3, a merger or consolidation of the Corporation with or into any other
corporation or corporations, or a sale of all or substantially all of the assets
of the Corporation, shall not be treated as a liquidation, dissolution or
winding up of the Corporation, but shall be treated as provided in Section
5(c)(iii) hereof.
(b) RIGHTS. Upon a Liquidation, as defined above, the assets and funds of
the Corporation available for distribution to its stockholders, if any, shall be
distributed ratably among the holders of Common Stock and Series A Preferred
Stock pro rata on the basis of the number of shares of Common Stock then
outstanding and issuable upon the conversion of the Series A Preferred Stock
then outstanding.
(c) CONSENT TO DISTRIBUTIONS. Each holder of Series A Preferred Stock
shall be deemed to have consented to distributions made by the Corporation or
its subsidiaries in connection with the repurchase of shares of the
Corporation's capital stock issued to or held by employees or consultants upon
termination of their employment or services pursuant to agreements providing for
such repurchase.
4. VOTING RIGHTS.
In addition to other rights provided herein or by law, the holders of
Series A Preferred Stock shall be entitled to vote on all matters submitted to
the stockholders of the Corporation for vote or consent and will vote with the
holders of Common Stock as one class. Each holder of Series A Preferred Stock
shall be entitled to one vote per share of Common Stock issuable upon conversion
of the shares of Series A Preferred Stock then held by such stockholder.
5. CONVERSION.
(a) AUTOMATIC CONVERSION. The shares of Series A Preferred Stock shall
automatically convert into shares of Common Stock upon the effectiveness of an
increase in the authorized number of shares of the Common Stock of the
Corporation (the "Common Stock") to not less than that number of shares
sufficient to allow the conversion of each share of the Series A Preferred Stock
into authorized shares of Common Stock that have not been issued, subscribed
for, or otherwise committed to be issued, at the Conversion Rate provided
herein. Such conversion will be effective without any further action by the
holders of the Series A Preferred Stock, immediately upon the occurrence of the
effectiveness of such Certificate Amendment.
(b) CONVERSION RATE. The Series A Preferred Stock shall initially be
convertible at the rate of three (3) shares of Common Stock for each share of
Series A Preferred Stock so converted pursuant to Section 5(a) hereto, subject
to appropriate adjustment as provided in Section 5(c) below (the "Conversion
Rate").
2
(c) CERTAIN EVENTS.
(i) SUBDIVISION OR COMBINATION OF COMMON STOCK. If the Corporation at
any time subdivides (by any stock split, stock dividend, recapitalization or
otherwise) its outstanding shares of Common Stock into a greater number of
shares, or if the Corporation at any time combines (by reverse stock split or
otherwise) one or more classes of its outstanding shares of Common Stock into a
smaller number of shares, the number of shares of Common Stock into which each
share of the Series A Preferred Stock shall be convertible shall be
proportionately adjusted.
(ii) REORGANIZATION AND RECLASSIFICATION OF COMMON STOCK. If the
Common Stock issuable upon conversion of the Series A Preferred Stock shall be
changed into shares of any other class or classes of stock, whether by capital
reorganization, reclassification or otherwise, the Series A Preferred Stock
shall, at the same time, automatically be convertible into, in lieu of shares of
Common Stock which the holders would otherwise have been entitled to receive,
the kind and amount of shares of such other class or classes of stock to which
such holder would have been entitled if immediately prior to such
reorganization, reclassification or other transaction, such holder had converted
his shares of Series A Preferred Stock into Common Stock at the Conversion Rate
in effect as of the consummation of such reorganization, reclassification or
other transaction.
(iii) ORGANIC CHANGES. In the event of any consolidation, merger, sale
of all or substantially all of the assets of the Corporation to any entity, or
any other transaction that is effected in such a manner that holders of shares
of Common Stock are entitled to receive (either directly or upon subsequent
liquidation) stock, securities, cash, assets or other property with respect to
or in exchange for such stock (any such transaction an "Organic Change"), the
shares of Series A Preferred Stock shall, immediately upon the receipt by the
holders of the Common Stock of such stock, securities, cash, assets or other
property be automatically exchanged for such stock, securities, cash, assets or
other property to which such holder would have been entitled if immediately
prior to such Organic Change, such holder had converted his shares of Series A
Preferred Stock into Common Stock at the Conversion Rate in effect as of the
consummation of such Organic Change. The provisions of this Section 5 shall
similarly apply to successive reorganizations, consolidations, mergers, sales or
other dispositions.
(d) EXCHANGE OF CERTIFICATES.
(i) All holders of Series A Preferred Stock which has been converted
into Common Stock shall promptly surrender to the Corporation or its transfer
agent certificates representing such shares. Within ten (10) business days
following such surrender, the Corporation shall issue and deliver to or upon the
written order of each such holder, at such office or other place designated by
the Corporation, a certificate or certificates for the number of full shares of
Common Stock to which such holder is entitled. Upon conversion of only a portion
of the shares of Series A Preferred Stock represented by a certificate
surrendered for conversion, the Corporation shall issue and deliver to or upon
the written order of the holder of the certificate so surrendered, at the
expense of the Corporation (except for expenses relating to the issuance of such
shares to a person other than the record holder of the shares of Series A
3
Preferred Stock which have been converted in to Common Stock), a new certificate
representing the unconverted shares of Series A Preferred Stock represented by
the certificate so surrendered.
(ii) The Corporation shall not be obligated to issue certificates
evidencing the shares of Common Stock issuable upon such conversion unless the
certificates evidencing the shares of Series A Preferred Stock which have been
converted into Common Stock are either delivered to the Corporation or its
transfer agent, or the holder notifies the Corporation or its transfer agent
that such certificates have been lost, stolen or destroyed and executes an
agreement satisfactory to the Corporation to indemnify the Corporation from any
loss incurred by it in connection with such certificates.
(e) NO IMPAIRMENT. The Corporation will not, by amendment of its Restated
Certificate of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms of the Series A Preferred Stock set forth herein, and will at all
times in good faith assist in the carrying out of all such terms and in the
taking of all such action as may be necessary or appropriate in order to protect
the rights of the holders of Series A Preferred Stock against impairment.
6. NOTICES.
All notices, requests and other communications shall be in writing
addressed to the Corporation at its principal office or to the holders of Series
A Preferred Stock at their addresses appearing on the stock ownership records of
the Corporation and delivered by a nationally recognized overnight mail carrier,
certified mail return receipt requested or facsimile. Any notice sent by
nationally-recognized overnight mail carrier shall be deemed to be delivered on
the expected date of delivery. Any notice sent by certified mail, return receipt
requested, shall be deemed to be delivered 3 days after mailing. Any notice sent
by facsimile shall be deemed delivered upon the receipt by sender of written
confirmation of transmission.
7. PROTECTIVE PROVISIONS.
(a) AMENDMENT OR REPEAL. In addition to any other rights provided by law,
the Corporation shall not, without first obtaining the affirmative vote or
written consent of the holders of not less than a majority of the outstanding
shares of Series A Preferred Stock, amend or repeal any of the rights,
preferences, privileges or powers of, or the restrictions provided for the
benefit of, the Series A Preferred Stock.
(b) PERMITTED ACTIONS. Notwithstanding the provisions of Section 7(a):
(i) The number of authorized shares of Series A Preferred Stock, or
of any other class or series of the Corporation's stock, may be increased or
decreased (but not below the number of shares thereof then outstanding) by the
affirmative vote of the holders of a majority of the outstanding stock of the
Corporation entitled to vote thereon without the separate vote or consent of the
holders of Series A Preferred Stock, pursuant to Section 242(b)(2) of the
General Corporation Law of the State of Delaware, or by resolution of the
Corporation's board of directors, to the extent permitted by Section 151
thereof.
4
(ii) Any new series of Preferred Stock may be authorized without
restriction, with rights on a parity with or superior to the Series A Preferred
Stock (provided that no such new series of Preferred Stock shall have the
conversion rights with priority senior to those of the Series A Preferred Stock)
by resolution of the Corporation's board of directors, to the extent permitted
by Section 151 of the General Corporation Law of the State of Delaware, without
the separate vote or consent of the holders of Series A Preferred Stock.
8. STATUS OF CONVERTED SHARES.
If shares of Series A Preferred Stock are converted pursuant to Section 5
hereof, the shares so converted shall, upon the filing of a certificate with the
Delaware Secretary of State, resume the status of authorized but unissued shares
of Preferred Stock of the Corporation.
9. AMENDMENTS AND WAIVERS.
Any right, preference, privilege or power of, or restriction provided for
the benefit of, the Series A Preferred Stock set forth herein may be amended and
the observation thereof may be waived (either generally or in a particular
instance and either retroactively or prospectively) with the written consent of
the Corporation and the affirmative vote or written consent of the holders of
not less than a majority of the shares of Series A Preferred Stock then
outstanding, and any amendment or waiver so effected shall be binding upon the
Corporation and all holders of Series A Preferred Stock.
* * *
RESOLVED FURTHER, that the Chairman of the Board, the President or any Vice
President, and the Secretary, the Chief Financial Officer or any Assistant
Secretary or Assistant Treasurer of the Corporation are each authorized to
execute, acknowledge and file a certificate of designation for the Series A
Preferred Stock in accordance with Section 103 of the Delaware General
Corporation Law."
[Remainder of page intentionally left blank.]
5
IN WITNESS WHEREOF, I have executed this Certificate and do affirm under penalty
of perjury that the foregoing is the act and deed of the Corporation and that
the facts stated herein are true as of this ____ day of February, 2001.
/s/ STEPHEN K. WORKMAN
--------------------------------------
Stephen K. Workman, Vice President of
Finance, Chief Financial Officer and
Secretary
6