Key business metrics

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Risk factors

Investing in our common stock involves a high degree of risk. You should consider carefully the risks and uncertainties described below, together with all of the other information in this prospectus, including our consolidated financial statements and related notes, before deciding whether to purchase shares of our common stock. If any of the following risks is realized, our business, financial condition, results of operations and prospects could be materially and adversely affected. In that event, the price of our common stock could decline and you could lose part or all of your investment.

Risks related to our business and industry

We are subject to the cyclical nature of the markets in which we compete and any future downturn may reduce demand for our products and revenue.

In the past, the markets in which we compete have experienced significant downturns, often connected with, or in anticipation of, the maturation of product cycles—for both manufacturers' and their customers' products—and with declining general economic conditions. These downturns have been characterized by diminished product demand, production overcapacity, high inventory levels and accelerated erosion of average selling prices. These markets are impacted by the aggregate capital expenditures of service providers and enterprises as they build out and upgrade their network infrastructure. These markets are highly cyclical and characterized by constant and rapid technological change, pricing pressures, evolving standards and wide fluctuations in product supply and demand.

We may experience substantial period-to-period fluctuations in future results of operations. Any future downturn in the markets in which we compete, or changes in demand for our products from our customers, could result in a significant reduction in our revenue. It may also increase the volatility of the price of our common stock.

In addition, the communications networks industry from time to time has experienced and may again experience a pronounced downturn. To respond to a downturn, many service providers and enterprises may slow their capital expenditures, cancel or delay new developments, reduce their workforces and inventories and take a cautious approach to acquiring new equipment and technologies from network equipment manufacturers, any of which could cause our results of operations to fluctuate from period to period and harm our business.

If spending for optical communications networks does not continue to grow as expected, our business may suffer.

Our future success depends on continued capital investment in global communications network infrastructure and on continued demand for high-bandwidth, high-speed communications networks and the ability of network equipment manufacturers to meet this demand. Spending on communications networks is limited by several factors, including limited investment resources, uncertainty regarding the long-term evolution and sustainability of service provider business models and a changing regulatory environment. We cannot be certain that demand for bandwidth-intensive content will continue to grow at the same pace in the future or that communications service providers will continue to increase spending to meet such demand. If expectations for growth of communications networks and bandwidth consumption are not realized and investment in communications networks does not grow as anticipated, our business, results of operations and gross margins could be harmed.

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Given the high fixed costs associated with our vertically integrated business, a reduction in demand for our products may adversely impact our gross profits and our results of operations.

We have a high fixed cost base due to our vertically integrated business model, including the fact that 536 of our employees as of June 30, 2011 were employed in manufacturing engineering and operations and business operations. We may not be able to adjust these fixed costs quickly to adapt to rapidly changing market conditions. Our gross profit and gross margin is greatly affected by our sales volume and volatility on a quarterly basis and the corresponding absorption of fixed manufacturing overhead expenses. In addition, because we are a vertically integrated manufacturer, insufficient demand for our products may subject us to the risk of high inventory carrying costs and increased inventory obsolescence. Given our vertical integration, the rate at which we turn inventory has historically been low when compared to our cost of sales. We do not expect this to change significantly in the future and believe that we will have to maintain a relatively high level of inventory compared to our cost of sales. As a result, we continue to expect to have a significant amount of working capital invested in inventory. We may be required to write down inventory costs in the future and our high inventory costs may have an adverse effect on our gross profits and our results of operations.

We are dependent on our key customers for a significant portion of our revenue and the loss of, or a significant reduction in orders from, any of our key customers may reduce our revenue and adversely impact our results of operations.

Historically, we have generated most of our revenue from a limited number of customers. In 2010, our top ten customers represented 61.9% of our total revenue, with only Finisar Corporation (15.3% of revenues) representing more than 10.0% of our revenues. Furthermore, sales of certain of our current products are dependent upon and concentrated among a limited number of customers and the successful introduction of future component and module products could similarly be dependent upon a limited number of customers. As a result, the loss of, or a significant reduction in orders from any our key customers would materially and adversely affect our revenue and results of operations. Adverse events affecting our key customers could also negatively affect our revenue and results of operations. In addition, network equipment manufacturers may continue to consolidate, and we may not be able to offset any potential decline in revenue arising from the consolidation of our existing customers with revenue from new customers or additional revenue from the combined company.

We face intense competition which could negatively impact our results of operations and market share.

The communications networking industry is highly competitive. Our competitors range from large, international companies offering a wide range of products beyond the optical networking component or module markets to smaller companies specializing in niche markets within the optical networking component and module markets. Some of our competitors, particularly larger, more diversified companies, have substantially greater technical, financial and marketing resources, name recognition, manufacturing capacity, and/or better-established relationships with customers than we have. Some of our competitors have more resources to develop or acquire, and more experience in developing or acquiring, new products and technologies and in creating market awareness for and selling these products and technologies. Some of our competitors may be able to develop new products more quickly than we can and may be able to develop products that are more reliable or which provide more functionality than our products. All of these advantages may cause us to lose sales or market share or reduce the prices of our products.

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We also face competition from some of our customers who evaluate our capabilities against the merits of manufacturing products internally. Such customers may be able to internally manufacture competitive products at a lower cost than we would charge these customers. As a result, customers may purchase fewer of our products or we may be forced to lower our selling prices, both of which would negatively impact our financial results.

We must continually achieve new design wins and enhance existing products or our business may be harmed.

The markets for our products are characterized by frequent new product introductions, changes in customer and market requirements and evolving industry standards, all with an underlying pressure to reduce cost and meet stringent reliability and qualification requirements. Our future performance will depend on our successful and timely development, introduction and market acceptance of new and enhanced products that address these challenges. The anticipated or actual introduction of new and enhanced products by us and by our competitors may lead our customers to defer or cancel orders for our existing products and rapid obsolescence and value diminution of existing inventory.

The development of new, technologically-advanced products is a complex and uncertain process requiring frequent innovation, highly-skilled engineering and development personnel and significant capital expenditures, as well as the accurate anticipation of technological and market trends. Product development delays may result from numerous factors, including:

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changing product specifications and customer requirements;

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unanticipated engineering and manufacturing complexities and problems discovered during development and manufacturing;

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difficulties in reallocating engineering resources and overcoming resource limitations; and

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changing market or competitive product requirements.

We have in the past experienced slowdowns in demand for existing products and delays in new product development, and such delays may occur again in the future. We cannot assure you that we will be able to identify, develop, manufacture, market or support new or enhanced products successfully, if at all, or on a timely basis. To the extent customers defer or cancel orders for our products for any reason or we fail to achieve new design wins, our competitive and financial position would be adversely affected and our ability to grow our revenue would be impaired.

Further, we cannot assure you that our new products will gain market acceptance or that we will be able to respond effectively to product introductions by competitors, technological changes or emerging industry standards. We also may not be able to develop and evolve the underlying core technologies necessary to create new products and enhancements, license these technologies from third parties, or remain competitive in our markets.

We are under continuous pressure to reduce the prices of our products.

The communications networking industry has historically been characterized by declining product prices for components over time as a result of new product and technology introductions, increased competition, aggressive pricing from our competitors and pricing pressure from customers. We have reduced the prices of some of our products in the past, and we expect to continue to experience pricing pressure for our products in the future. When

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seeking to maintain or increase their market share, our competitors may also reduce the prices of their products. In addition, our customers may have the ability to internally develop and manufacture competing products at a lower cost than we would otherwise charge, which would add additional downward pressure on our selling prices. If we are unable to offset future reductions in our average selling prices by increasing our sales volume, by reducing our costs and expenses or by introducing new products at higher price points, our profitability could suffer.

Our manufacturing processes are extremely complex and specialized and disruptions could have a material adverse effect on our business, financial condition and results of operations.

The fabrication of our products involves extremely complex and precise processes. We may experience delays, disruptions or quality control problems in our manufacturing operations. For instance, minor impurities, contamination of the clean room environment, errors in any step of the fabrication process, defects in equipment or materials, human error, or a number of other factors can cause a substantial percentage of our products to be rejected or malfunction. We could also experience a disruption in our fabrication facility for our products due to equipment maintenance, repairs and/or upgrades.

Additionally, manufacturing yields depend on a number of factors, including the stability and manufacturability of the product design, manufacturing improvements gained over cumulative production volumes, the quality and consistency of component parts and the nature and extent of customization requirements by customers. Capacity constraints, raw materials shortages, logistical issues, labor shortages, the introduction of new product lines and changes in customer requirements, manufacturing facilities or processes, or those of some third party contract manufacturers and suppliers of raw materials and components have historically caused, and may in the future cause, reduced manufacturing yields. Moreover, an increase in the rejection and rework rate of products during the quality control process before, during or after manufacture would result in our experiencing lower yields. As a result of all of these potential difficulties, we could incur additional costs to fulfill customer orders and/or product shipments to our customers could be delayed, each of which would negatively affect our revenue, costs, competitive position and reputation.

We rely on a limited number of suppliers for certain raw materials, and if they stopped, decreased or delayed shipments to us, it could have an adverse effect on our business.

We depend on a limited number of suppliers for certain raw materials we have qualified to use in the manufacture of certain of our products. Some of these suppliers could disrupt our business if they stop, decrease or delay shipments or if the materials they ship have quality or consistency issues. Some of these materials are available only from a limited number of suppliers or have been qualified only from a single supplier. For example, we currently rely on two suppliers, Finisar Corporation and Alps Electric (USA), Inc., for certain piece parts used in our products that comprised approximately 23% and 21% of our total revenue for the year ended December 31, 2010, respectively. Collectively, such piece parts were used in products that comprised approximately 23% of our revenues for the year ended December 31, 2010 as there was significant overlap between the products that incorporated such piece parts. Although we rely on these two suppliers as the single source of our supply for such piece parts, these piece parts are available from a limited number of other sources. We may also face material shortages if we experience increased demand for materials beyond what our qualified suppliers can deliver on a timely basis or at all. Although we strive to mitigate shortages, any

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inability on our part to timely obtain sufficient quantities of critical piece parts at reasonable costs could adversely affect our ability to meet demand for our products, which could cause our revenue, results of operations, or both to suffer.

We typically have not entered into long-term agreements with our suppliers and, therefore, our suppliers could stop supplying materials at any time or fail to supply adequate quantities of piece parts on a timely basis. It is difficult, costly, time consuming and, on short notice, sometimes impossible for us to identify and qualify new suppliers. The reliance on a sole supplier, single qualified vendor or limited number of suppliers could result in delivery and quality problems and reduced control over product pricing, reliability and performance. We have in the past had to change suppliers, which has, in some instances, resulted in delays in product development and manufacturing and loss of revenue.

If we fail to retain our key personnel or if we fail to attract additional qualified personnel, we may not be able to achieve our anticipated level of growth and our business could suffer.

Our future success depends, in part, on our ability to attract and retain key personnel, including our senior management team and others, and on the continued contributions of members of our senior management team and key technical personnel, each of whom would be difficult to replace. The loss of any of the members of our senior management team or key personnel or the inability to continue to attract and retain qualified personnel could have a material adverse effect on our business. Competition for highly skilled technical personnel is extremely intense, and we continue to face challenges identifying, hiring and retaining qualified personnel in certain areas of our business. If we fail to retain our senior management and other key personnel or if we fail to attract additional qualified personnel, our business could suffer.

Our success will depend on our ability to anticipate and quickly respond to rapidly changing technologies and customer requirements.

The communications networking industry is characterized by substantial investment in new technologies and the development of diverse and changing technologies. For example, new technologies are required to satisfy the emerging standards for 40Gbps and 100Gbps data transmission in communications networks. Furthermore, fast introduction of new products can be critical to success. It is difficult to displace an existing supplier for a particular type of product once a network equipment manufacturer has chosen a supplier, even if a later-to-market product provides superior performance or cost efficiency. If we are unable to make our new or enhanced products commercially available on a timely basis, we may lose existing and potential customers for extended time periods, which would cause our financial results to suffer.

The communications networking industry has long product development cycles requiring us to incur product development costs without assurances of an acceptable investment return.

The communications networking industry is highly capital-intensive. Large volumes of equipment and support structures are installed with considerable expenditures of funds and other resources, and long investment return period expectations. At the component supplier level, this creates considerable, typically multi-year, gaps between the commencement of new product development and volume purchases. Accordingly, we often incur significant research and development costs for products that, at the earliest, will be purchased by our customers

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long after much of the cost is incurred and, in some cases, may never be purchased due to changes in industry or customer requirements in the interim.

Due to changing industry and customer requirements, we are constantly developing new products and developing and using new technologies in our products. These development activities can and are expected to necessitate a significant investment of capital. Our new products often require a long time to develop because of their complexity and rigorous testing and qualification requirements. Additionally, developing a manufacturing approach with an acceptable cost structure and yield for new products can be expensive and time-consuming. Due to the costs and length of research and development and manufacturing process cycles, we may not recognize revenue from new products until long after such expenditures are incurred, if at all, and our gross margin may decrease if our costs are higher than expected.

If our customers do not qualify our products for use, then our results of operations may suffer.

Prior to placing volume purchase orders with us, most of our customers require us to obtain their approval of our new and existing products, and our customers often audit our manufacturing facilities and perform other vendor evaluations during this process. The approval process, generally known as qualification, involves product sampling and reliability testing and collaboration with our product management and engineering teams in the design and manufacturing stages. For example, we have developed new technologies and products that are key components in our customers' systems for 40Gbps and 100Gbps data transmission. While we are shipping certain products for 40Gbps and 100Gbps system designs today, many of our products for these systems are currently being qualified for use by our customers. If we are unable to qualify these and other of our products with customers, then our future revenues would be lower than expected, and we may not be able to recover the costs of our investments in new and existing products, each of which would have an adverse effect on our results of operations.

In addition, due to rapid technological changes in our markets, a customer may cancel or modify a design project before we have qualified our product or begun volume manufacturing of a qualified product. It is unlikely that we would be able to recover the expenses for cancelled or unutilized custom design projects. It is difficult to predict with any certainty whether our customers will delay or terminate product qualification or the frequency with which customers will cancel or modify their projects, but any such delay, cancellation or modification would have a negative effect on our results of operations.

Rapidly changing standards and regulations could make our products obsolete, which would cause our revenue and results of operations to suffer.

We design our products to conform to regulations established by governments and to standards set by industry standards bodies worldwide, such as the American National Standards Institute, the European Telecommunications Standards Institute, the International Telecommunications Union and the Institute of Electrical and Electronics Engineers, Inc. Various industry organizations are currently considering whether and to what extent to create standards for elements used in 100Gbps systems. Because certain of our products are designed to conform to current specific industry standards, if competing or new standards emerge that are preferred by our customers, we would have to make significant expenditures to develop new products. If our customers adopt new or competing industry standards with which our products are not compatible, or the industry groups adopt standards or governments issue

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regulations with which our products are not compatible, our existing products would become less desirable to our customers and our revenue and results of operations would suffer.

Customer demand is difficult to forecast and, as a result, we may be unable to optimally match production with customer demand.

We make planning and spending decisions, including determining the levels of business that we will seek and accept, production schedules, component procurement commitments, personnel needs and other resource requirements, based on our estimates of customer demand. The majority of our products are purchased pursuant to individual purchase orders. While our customers generally provide us with their demand forecasts, they are typically not contractually committed to buy any quantity of products beyond firm purchase orders. The short-term nature of our customer commitments and the possibility of unexpected changes in demand for their products limit our ability to accurately predict future customer demand. On occasion, customers have required rapid increases in production, which has strained our resources. We may not have sufficient capacity at any given time to meet the volume demands of our customers, or one or more of our suppliers may not have sufficient capacity at any given time to meet our volume demands. Conversely, a downturn in the markets in which our customers compete can cause, and in the past has caused, our customers to significantly reduce the amount of products ordered from us or to cancel existing orders, leading to lower utilization of our facilities. Because many of our costs and operating expenses are relatively fixed, reduction in customer demand would have an adverse effect on our gross margin, income (loss) from operations and cash flow. During an industry downturn, there is also a higher risk that our trade receivables would be uncollectible.

It could be discovered that our products contain defects that may cause us to incur significant costs, divert our management's attention, result in a loss of customers and result in product liability claims.

Our products are complex and undergo quality testing and formal qualification by our customers and us. However, defects may occur from time to time. Our customers' testing procedures involve evaluating our products under likely and foreseeable failure scenarios and over varying amounts of time. For various reasons, such as the occurrence of performance problems that are unforeseeable in testing or that are detected only when products age or are operated under peak stress conditions, our products may fail to perform as expected long after customer acceptance. Failures could result from faulty components or design, problems in manufacturing or other unforeseen reasons. For the majority of our products, we provide a product warranty of one year or less from date of shipment. For select customers, we provide extended warranties beyond our normal product warranty period for specified failures on a case-by-case basis. As a result, we could incur significant costs to repair or replace defective products under warranty, particularly when such failures occur in installed systems. We have experienced failures in the past and will continue to face this risk going forward, as our products are widely deployed throughout the world in multiple demanding environments and applications. In addition, we may in certain circumstances honor warranty claims after the warranty has expired or for problems not covered by warranty in order to maintain customer relationships. Any significant product failure could result in lost future sales of the affected product and other products, as well as customer relations problems, litigation and damage to our reputation.

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In addition, our products are typically embedded in, or deployed in conjunction with, our customers' products, which incorporate a variety of components, modules and subsystems and may be expected to interoperate with modules and subsystems produced by third parties. As a result, not all defects are immediately detectable and when problems occur, it may be difficult to identify the source of the problem. These problems may cause us to incur significant damages or warranty and repair costs, divert the attention of our engineering personnel from our product development efforts and cause significant customer relations problems or loss of customers, all of which would harm our business. The occurrence of any defects in our products could also give rise to liability for damages caused by such defects. Although we carry product liability insurance to mitigate this risk, insurance may not adequately cover costs that may arise from defects in our products or otherwise, nor will it protect us from reputational harm that may result from such defects.

If we fail to adequately manage our long-term growth and expansion requirements, our business will suffer.

In recent years, we have experienced significant growth through, among other things, internal expansion programs, new product developments and acquisitions of other companies. We expect to continue to grow, which could require us to expand our manufacturing operations, including hiring new personnel, purchasing additional equipment, leasing or purchasing additional facilities, expanding our management infrastructure and working with our suppliers to manage any such expansion. If we fail to secure these expansion requirements or manage our future growth effectively, our business could suffer.

Natural disasters, terrorist attacks or other catastrophic events could harm our operations.

Our worldwide operations could be subject to natural disasters and other business disruptions, which could harm our future revenue and financial condition and increase our costs and expenses. Further, a terrorist attack, including one aimed at energy or communications infrastructure suppliers, could hinder or delay the development and sale of our products. Although we maintain casualty and business interruption insurance, if an earthquake, typhoon, hurricane, terrorist attack or other natural or manmade catastrophe were to destroy any part of our facilities, destroy or disrupt vital infrastructure systems or interrupt our operations for any extended period of time, our business would be materially adversely affected.

Our manufacturing facilities are leased from third parties.

We conduct all of our manufacturing operations at facilities located in Pennsylvania, New Jersey and Mexico. The leases for our facilities located in Pennsylvania expire in July 2014 and October 2017, if not renewed at our option; the lease for our facility located in New Jersey expires in July 2014, if not renewed at our option; and the lease for our facility located in Mexico expires in December 2011, if not renewed at our option. We are substantially dependent on our facilities in Pennsylvania and New Jersey and a loss of use of one or more of our manufacturing facilities may result in an interruption or delay in our ability to manufacture our products. If we are unable to renew our leases with the owners of the facilities on commercially reasonable terms, or if we migrate to new facilities, we may experience delays in delivering our products until leases for other facilities can be arranged and the migration to a new facility is completed.

Our operations also rely heavily on the availability of electrical power and cooling capacity, which are also supplied by third-party providers. If our facilities experience a major power

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outage or if the cost of electrical power increases significantly, our operations and profitability could be harmed. If our facilities experience a major power outage, we would have to rely on back-up generators, which may not function properly, and their supply may be inadequate. Such a power outage could result in the disruption of our business. Additionally, if our current facilities fail to have sufficient cooling capacity or availability of electrical power, we would need to find alternative facilities.

If we fail to protect, or incur significant costs in defending, our intellectual property and other proprietary rights, our business and results of operations could be materially harmed.

Our success depends to a significant degree on our ability to protect our intellectual property and other proprietary rights. We rely on a combination of patent, trademark, trade secret and unfair competition laws, as well as license agreements and other contractual provisions, to establish and protect our intellectual property and other proprietary rights. We have applied for patent registrations in the United States, most of which have been issued. In addition, we are applying to register the trademark "CyOptics" in the United States. We cannot guarantee that our pending applications will be approved by the applicable governmental authorities. Moreover, our existing and future patents and trademarks may not be sufficiently broad to protect our proprietary rights or may be held invalid or unenforceable in court. Failure to obtain patents or trademark registrations or a successful challenge to our registrations in the United States would limit our ability to protect the intellectual property rights that these applications and registrations are intended to cover.

We also attempt to protect our intellectual property, including our trade secrets and know-how, through the use of trade secret and other intellectual property laws, and contractual provisions. We enter into confidentiality and invention assignment agreements with our employees and independent consultants. We also use non-disclosure agreements with other third parties who may have access to our proprietary technologies and information. Such measures, however, provide only limited protection, and there can be no assurance that our confidentiality and non-disclosure agreements will not be breached, especially after our employees or those of our third-party contract manufacturers end their employment or engagement, and that our trade secrets will not otherwise become known by competitors or that we will have adequate remedies in the event of unauthorized use or disclosure of proprietary information. Unauthorized third parties may try to copy or reverse engineer our products or portions of our products, otherwise obtain and use our intellectual property, or may independently develop similar or equivalent trade secrets or know-how. If we fail to protect our intellectual property and other proprietary rights, or if such intellectual property and proprietary rights are infringed or misappropriated, our business, results of operations or financial condition could be materially harmed.

Policing unauthorized use of our technology is difficult, and we cannot be certain that the steps we have taken will prevent the misappropriation, unauthorized use or other infringement of our intellectual property rights. Further, if we are unable to effectively protect our intellectual property rights from misappropriation or other infringement in foreign countries where we have not applied for patent protections, and where patent, trademark, trade secret and other intellectual property laws are ineffective or unavailable, or do not protect our proprietary rights as fully as U.S. law, our business could be materially harmed.

If we are compelled to take legal actions to protect and enforce our intellectual property rights and determine their validity and scope, these actions would result in litigation costs and could require significant time and attention from our technical and management personnel. In addition, an adverse outcome of such proceedings could reduce our competitive advantage or otherwise harm our financial condition and our business.

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We have entered into an agreement with one of our customers that requires us to place manufacturing or technical information, including patents, trade secrets, know-how, source code and other intellectual property, into an escrow. Such agreement provides that the customer will have a right to access the escrowed materials if we experience insolvency, commit a material breach and/or are unable or unwilling to deliver the ordered products in the allotted timeframe. Depending on the licenses granted upon release of the escrow, we may not be able to control the customer's use of the released materials and may not be able to receive the same revenue that we would receive when selling the products in the ordinary course of business.

Our participation in standards setting organizations or industry initiatives may require us to license our patents to other companies that adopt certain standards or specifications. As a result of such licensing, our patents may not be enforceable against others who might otherwise be infringing those patents and the value of our intellectual property may be impaired. Likewise, in order to provide products that are compliant with standards that have been adopted or will be adopted in the future, we could license patents owned by others. Such licensing requirements may materially adversely affect the value of our products, and, consequently, our business, financial condition, liquidity and results of operations.

We may be involved in intellectual property disputes in the future, which could divert management's attention, cause us to incur significant costs and prevent us from selling or using the challenged technology.

Participants in the markets in which we sell our products have experienced litigation regarding patent and other intellectual property rights. Regardless of their merit, responding to claims against us alleging infringement of certain patents or other intellectual property rights of others can be time consuming, divert management's attention and resources and may cause us to incur significant expenses. While we do not believe that our products infringe upon the intellectual property rights of other parties and meritorious defenses would exist with respect to any assertions to the contrary, we cannot be certain that our products would not be found infringing the intellectual property rights of others. If certain of our proprietary rights are found to be invalid, among other potential actions, we may be required to:

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obtain from a third party claiming infringement a license to sell or use the relevant technology, which may not be available on reasonable terms, or at all;

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stop manufacturing, selling, incorporating or using our products that use the challenged intellectual property;

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pay substantial monetary damages; or

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expend significant resources to redesign the products that use the technology and to develop non-infringing technology.

Any of these actions could adversely affect our financial results.

We may be obligated to indemnify our customers for claims that our intellectual property infringes the rights of others, which may result in substantial expenses to us.

We often indemnify our customers for intellectual property claims made against them for products incorporating our technology. As such, claims against our customers may require us to

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incur substantial expenses, such as legal expenses, damages for past infringement or royalties for future use. While we have not incurred any indemnification expenses to date, any future indemnity claim could adversely affect our relationships with our customers and result in substantial costs to us.

We face a variety of risks associated with international sales and operations.

We currently derive, and expect to continue to derive, a significant portion of our revenue from international sales in various markets. Our international revenue and operations are subject to a number of material risks, including, but not limited to:

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difficulties in staffing, managing and supporting operations in more than one country;

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difficulties in enforcing agreements and collecting receivables through foreign legal systems;

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fewer legal protections for intellectual property in foreign jurisdictions;

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foreign and U.S. taxation issues and international trade barriers;

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general economic and political conditions in the markets in which we operate;

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difficulties in obtaining any necessary governmental authorizations for the export of our products to certain foreign jurisdictions;

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fluctuations in foreign economies;

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fluctuations in the value of foreign currencies and interest rates;

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availability and continuity of labor supply;

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trade and travel restrictions;

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outbreaks of contagious diseases;

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domestic and international economic or political changes, hostilities and other disruptions in regions where we currently operate or may operate in the future;

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difficulties and increased expenses in complying with a variety of U.S. and foreign laws, regulations and trade standards; and

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different and changing legal and regulatory requirements in the jurisdictions in which we currently operate or may operate in the future.

Negative developments in any of these areas could result in a reduction in demand for our products, the cancellation or delay of orders already placed, difficulties in producing and delivering our products, threats to our intellectual property, difficulty in collecting receivables, and a higher cost of doing business. In addition, although we intend to implement an anti-corruption compliance program throughout the company prior to this offering, violations of our compliance program may result in criminal or civil sanctions, including material monetary fines, penalties and other costs against us or our employees, and may have a material adverse effect on our business.

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We have a limited history of operations, making it difficult to predict our future results of operations.

We have a limited history of operations, which makes it difficult to evaluate our business and financial prospects. While our operations began in 1999, we did not generate revenue from the commercial shipments of our initial products until 2001. Since then, our revenue, gross margin and results of operations have varied significantly and are likely to continue to vary from quarter to quarter due to a number of factors, many of which are not within our control. For instance, changes in gross margin may result from various factors, such as changes in pricing, changes in our fixed costs, changes in the mix of our products sold and changes in the amount of product manufactured versus the amount of product sold over time. In making an investment decision, you should evaluate our business in light of the risks, expenses and difficulties frequently encountered by companies in the rapidly changing communications networking industry. It is difficult for us to accurately forecast our future revenue and gross margin and plan expenses accordingly and, therefore, it is difficult for us to predict our future results of operations.

We have outstanding indebtedness that exposes us to risks that could adversely affect our business, results of operations and financial condition.

We had approximately $11.8 million of debt outstanding as of June 30, 2011. We have a $20.0 million revolving credit facility with Silicon Valley Bank that is subject to certain borrowing base restrictions and is secured by liens on substantially all of our assets. As of June 30, 2011, we had $10.2 million outstanding under this revolving line and $6.1 million currently available for borrowing. We also had a term loan balance of $0.6 with Silicon Valley Bank at June 30, 2011 that was repaid in full in August 2011. In addition, we had approximately $1.1 million of debt outstanding at June 30, 2011 from TriQuint Semiconductor that is also subject to liens on substantially all of our assets. Even after giving effect to the use of proceeds of this offering as described under "Use of Proceeds", we expect to continue to have outstanding indebtedness following this offering. The level and nature of our indebtedness could, among other things:

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make it difficult for us to obtain any necessary financing in the future;

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limit our flexibility in planning for or reacting to changes in our business;

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reduce funds available for use in our operations;

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hinder our ability to raise equity capital, because in the event of a liquidation of our business, debt holders receive a priority before equity holders; and

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make us more vulnerable in the event of a downturn in our business.

If we increase our indebtedness by borrowing under our credit facilities or incur other new indebtedness, each of the risks described above would increase.

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We may not be able to obtain capital when desired on favorable terms, if at all, or without dilution to our stockholders.

It is possible that we may not generate sufficient cash flow from operations or otherwise have the capital resources to meet our future capital needs. If this occurs, we may need additional financing to execute on our current or future business strategies, including:

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investment in our research and development efforts by hiring additional technical and other personnel;

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expansion of our operating or manufacturing infrastructure;

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acquisitions of complementary businesses, products or technologies; or

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pursuit of our strategic plans and response to competitive pressures.

If we raise additional funds through the issuance of equity or convertible debt securities, the percentage ownership of our stockholders could be significantly diluted, and these newly-issued securities may have rights, preferences or privileges senior to those of existing stockholders, including those acquiring shares in this offering. We cannot assure you that additional financing will be available on terms favorable to us, or at all. If adequate funds are not available or are not available on acceptable terms, if and when needed, our ability to fund our operations, take advantage of unanticipated opportunities, develop or enhance our products, or otherwise respond to competitive pressures could be significantly limited.

Potential future acquisitions could be difficult to integrate, divert the attention of key personnel, disrupt our business, dilute stockholder value and impair our financial results.

As part of our business strategy, we have pursued and intend to continue to pursue acquisitions of complementary businesses, products or technologies that we believe could accelerate our ability to compete in our existing markets or allow us to enter new markets.

Acquisitions involve numerous risks, any of which could harm our business, including:

•

difficulties in integrating the operations, technologies, products, existing contracts, accounting and personnel of the target company and realizing the anticipated synergies of the combined businesses;

•

difficulties in supporting and transitioning customers, if any, of the target company;

•

diversion of financial and management resources from existing operations;

•

the price we pay or other resources that we devote may exceed the value we realize, or the value we could have realized if we had allocated the purchase price or other resources to another opportunity;

•

risks of entering new markets in which we have limited or no experience;

•

potential loss of key employees, customers and strategic alliances from either our current business or the target company's business;

•

assumption of unanticipated problems or liabilities, such as problems with the quality of the target company's products;

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•

inability to generate sufficient revenue to offset acquisition costs;

•

dilutive effect on our stock as a result of any equity-based acquisitions;

•

failure to realize anticipated tax benefits;

•

inability to successfully complete transactions with a suitable acquisition candidate; and

•

in the event of international acquisitions, risks associated with accounting and business practices that are different from applicable U.S. practices and requirements.

Acquisitions also frequently result in the recording of goodwill and other intangible assets which are subject to potential impairments which have occurred in the past and which, were they to occur in the future, could harm our financial results.

Acquisitions may also result in the incurrence of liabilities. For example, in July 2008, we acquired PGT Photonics, S.p.A., or PGT, which enabled us to gain access to PGT's unique tunable laser products and technologies, complementary photonic integrated circuit capabilities and manufacturing infrastructure. In September 2009, as a result of the macroeconomic downturn, we commenced dissolution of PGT and synergized the acquired PGT technologies into our ongoing operations, and a liquidator was assigned to dissolve PGT pursuant to Italian law. Dissolution of entities under Italian law is a lengthy process and we have not finalized the PGT dissolution. While we believe we have satisfied all outstanding PGT-related liabilities and have no material continuing obligations or commitments related to PGT, it is possible that we may be subject to liabilities which, if substantial, could harm our results of operations.

As a result, if we fail to properly evaluate acquisitions or investments, we may not achieve the anticipated benefits of any such acquisitions, and we may incur costs in excess of what we anticipate. The failure to successfully evaluate and execute acquisitions or investments or otherwise adequately address these risks could materially harm our business and financial results.

If we fail to maintain effective internal control over financial reporting in the future, the accuracy and timing of our financial reporting may be adversely affected.

The preparation of our consolidated financial statements involves a number of complex manual and automated processes, which are dependent upon individual data input or review and require significant management judgment. One or more of these elements may result in errors that may not be detected and could result in a material misstatement of our consolidated financial statements.

The Sarbanes-Oxley Act of 2002, or Sarbanes-Oxley Act, requires, among other things, that as a publicly traded company we maintain effective internal control over financial reporting and disclosure controls and procedures.

If a material misstatement occurs in the future, we may fail to meet our future reporting obligations, we may need to restate our financial results and the price of our common stock may decline. Any failure of our internal controls could also adversely affect the results of the periodic management evaluations and annual independent registered public accounting firm attestation reports regarding the effectiveness of our internal control over financial reporting that will be required when the rules of the Securities and Exchange Commission, or the SEC,

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under Section 404 of the Sarbanes-Oxley Act, which would most likely become applicable to us beginning with the filing of our Annual Report on Form 10-K for the year ending December 31, 2012. Effective internal controls are necessary for us to produce reliable financial reports and are important to helping prevent financial fraud. As a public company, we will need to augment our internal finance functions and, if we are unable to do so, it may make it more difficult for us to meet our obligations under the Sarbanes-Oxley Act, including the requirement to find that our internal controls are effective. If we cannot provide reliable financial reports or prevent fraud, our business and results of operations could be harmed, investors could lose confidence in our reported financial information, and the trading price of our stock could drop significantly.

Potential changes in our effective tax rate could harm our future results.

We are subject to income taxes in the United States and various foreign jurisdictions, and our domestic and international tax liabilities are subject to the allocation of expenses in differing jurisdictions. Our tax rate is affected by changes in the mix of earnings and losses in countries with differing statutory tax rates, certain non-deductible expenses arising from the requirement to expense stock options and the valuation of deferred tax assets and liabilities, including our ability to utilize any net operating losses. Increases in our effective tax rate could harm our results of operations.

We may be unable to utilize our net operating loss carryforwards to reduce our income taxes.

As of December 31, 2010, we had net operating loss, or NOL, carryforwards for U.S. federal and state tax purposes of $186.9 million and $64.8 million, respectively, with a corresponding valuation allowance. If not utilized, these NOL carryforwards expire, beginning in 2022. Subsequent to December 31, 2010, as a consequence of equity transactions in January 2011, we anticipate further limitation on the use of our NOL carryforwards. The utilization of the NOL carryforwards are subject to a substantial limitation imposed by Section 382 of the Internal Revenue Code of 1986, as amended, and similar state provisions. As of December 31, 2010, we recorded deferred tax assets with a corresponding valuation allowance for the NOL carryforwards currently available after considering the existing Section 382 limitation. Based on the preliminary results of a study that we are in the process of completing to assess the ownership changes that have occurred since our formation and their impact on the value of the NOLs, we have updated our deferred tax assets and corresponding valuation allowance to reflect the most recent analysis for our existing NOL carryforwards that are not subject to limitation. As of June 30, 2011, the estimated total available net operating loss carryforwards are approximately $49.0 million for federal purposes and approximately $47.0 million for state purposes. Upon finalization of the Section 382 study, we may further adjust the amount of the NOLs that we can utilize.

We will incur increased costs as a result of operating as a public company, and our management will be required to devote substantial time to new compliance initiatives.

As a public company, we will incur legal, accounting and other expenses that we did not incur as a private company. In addition, the Sarbanes-Oxley Act and the Dodd-Frank Wall Street Reform and Consumer Protection Act, as well as rules subsequently implemented by the SEC and the NASDAQ Stock Market, impose additional requirements on public companies, including specific corporate governance practices. For example, the listing requirements of the NASDAQ Stock Market require that we satisfy certain corporate governance requirements relating to

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independent directors, audit and compensation committees, distribution of annual and interim reports, stockholder meetings, stockholder approvals, solicitation of proxies, conflicts of interest, stockholder voting rights and codes of conduct. Our management and other personnel will need to devote a substantial amount of time to these compliance initiatives. Moreover, these rules and regulations will increase our legal and financial compliance costs and will make some activities more time-consuming and costly. For example, we expect these rules and regulations to make it more difficult and more expensive for us to obtain director and officer liability insurance, and we may be required to accept reduced policy limits and coverage or incur substantial additional costs to maintain the same or similar coverage. These rules and regulations could also make it more difficult for us to attract and retain qualified persons to serve on our board of directors, our board committees or as executive officers.

We are subject to governmental export and import controls that could subject us to liability or impair our ability to compete in international markets.

We are subject to export control laws, regulations and requirements that limit which products we sell and where and to whom we sell our products. While we do not believe we are currently required to obtain any export licenses, and we have not obtained any export licenses to date, it is possible that export licenses would be required in the future from U.S. government agencies for some of our products in accordance with various laws, including but not limited to, the International Traffic in Arms Regulations. In addition, various countries regulate the import of certain technologies and have enacted laws that could limit our ability to distribute our products. We may not be successful in obtaining the necessary export and import licenses. Failure to comply with these and similar laws on a timely basis, or at all, or any limitation on our ability to export or sell our products would adversely affect our business, financial condition and results of operations.

Changes in our products or changes in export and import laws and implementing regulations may create delays in the introduction of new products in international markets, prevent our customers from deploying our products internationally or, in some cases, prevent the export or import of our products to certain countries altogether. Any change in export or import regulations or related legislation, shift in approach to the enforcement or scope of existing regulations, or change in the countries, persons or technologies targeted by such regulations, could result in decreased use of our products by, or in our decreased ability to export or sell our products to, existing or potential customers with international operations. In such event, our business and results of operations could be adversely affected.

We are subject to government regulations that could adversely impact our business.

The Federal Communications Commission, or FCC, has jurisdiction over the entire U.S. telecommunications industry and, as a result, our products and our U.S. customers are subject to FCC rules and regulations. Our business is also subject to other U.S. governmental and regulatory authorities, including the Department of Homeland Security, International Trafficking in Arms Regulations and the Department of Defense. Current and future regulations affecting communications services, our products or our customers' businesses could impose new requirements or result in more stringent enforcement of existing laws, which could result in additional costs and increased penalties, which could negatively affect our business. In addition, international regulatory standards could impair our ability to develop products for international customers in the future. Delays caused by our compliance with regulatory

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requirements could result in postponements or cancellations of product orders. Further, we may not be successful in obtaining or maintaining any regulatory approvals that may, in the future, be required to operate our business. Any failure to obtain such approvals could harm our business and results of operations.

We sell our products to federal government entities under subcontracts. A loss or reduction of such contracts, a failure to obtain new contracts or a modification or termination under such contracts could have an adverse effect on our business.

We derived less than 2.0% of our revenues for the fiscal year 2010 from subcontracts with prime defense contractors or subcontractors of the federal government. The loss or significant curtailment of any of these government subcontracts, or failure to exercise renewal options or enter into new contracts or subcontracts, could have an adverse effect on our future business, results of operations and financial condition. Continuation and the exercise of renewal options on existing government subcontracts and new government contracts and subcontracts are, among other things, contingent upon the availability of adequate funding for the various federal government agencies with which we and prime government contractors do business. Changes in federal government spending could directly affect our financial performance. Among the factors that could impact federal government spending and which would reduce our federal government contracting and subcontracting business are:

•

a significant decline in, or reapportioning of, spending by the federal government;

•

changes, delays or cancellations of federal government programs or requirements;

•

the adoption of new laws or regulations that affect companies that provide products or services to the federal government;

•

federal government shutdowns or other delays in the government appropriations process;

•

curtailment of the federal government's use of third-party firms;

•

changes in the political climate, including with regard to the funding for the products we provide; and

•

general economic conditions.

Furthermore, if the current presidential administration were to reorder its budgetary priorities resulting in a general decline in U.S. defense spending, it could cause federal government agencies to reduce their purchases under contracts, exercise their rights to terminate contracts in whole or in part, to issue temporary stop work orders or decline to exercise options to renew contracts, all of which could harm our operations and significantly reduce our future revenues.

In addition, the federal government can terminate or modify any of its contracts with us or its prime contractors either for its convenience, or if we or its prime contractors default, by failing to perform under the terms of the applicable contract. A termination arising out of our default could expose us to liability and have a material adverse effect on our ability to compete for future contracts and subcontracts. If the federal government or its prime contractors terminate and/or materially modify any of our contracts or if any applicable options are not exercised,

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our failure to replace sales generated from such contracts would result in lower sales and could adversely affect our earnings, which could have a material adverse effect on our business.

We are subject to environmental, health and safety laws and regulations, which could subject us to liabilities, increase our costs, or restrict our business or operations in the future.

Our manufacturing operations and our products are subject to a variety of federal, state, local and international environmental, health and safety laws and regulations. These laws and regulations govern, among other things, air emissions, wastewater discharges, the handling and disposal of hazardous substances and wastes, soil and groundwater contamination, employee health and safety, and the use of hazardous materials in our products. Liability under environmental, health and safety laws can be joint and several and without regard to fault or negligence. There can be no assurance that violations of these laws will not occur in the future, as a result of human error, accident, equipment failure or other causes. Our failure to comply with present and future environmental, health or safety requirements, or the identification of contamination, could cause us to incur substantial costs, including cleanup costs, monetary fines, and civil or criminal penalties, and subject us to property damage or personal injury claims, suspension of production, alteration of our manufacturing facilities or processes, or curtailment of operations sales and adverse publicity. In addition, these laws and regulations have increasingly become more stringent over time and we expect that our operations and products will be affected by new environmental requirements on an ongoing basis, which will likely result in additional costs, which could have a material adverse effect on our business. The identification of presently unidentified environmental conditions, more vigorous enforcement of current environmental, health and safety requirements by regulatory agencies, or other unanticipated events could restrict our ability to expand our facilities, require us to install costly pollution control equipment or incur other additional expenses, or require us to modify our manufacturing processes or the contents of our products, which could have a material adverse effect on our business, financial condition and results of operations.

Our manufacturing facilities use, store and dispose of hazardous substances in connection with their processes. In addition, our operations have grown through acquisitions, and it is possible that businesses that we have acquired may expose us to environmental liabilities that have not yet been discovered associated with historical site conditions or offsite locations. Some environmental laws impose liability for contamination on current and former owners and operators of affected sites, or on parties that generated wastes disposed of at off-site locations, regardless of fault. In the event we are found liable for any such contamination in the future, there can be no assurance that remediation costs, or potential claims for personal injury or property or natural resource damages resulting from contamination, will not be material.

Some jurisdictions in which our products are sold have enacted requirements regarding the hazardous material content of certain products. For example, member states of the European Union, are among a growing number of jurisdictions, which have placed restrictions on the use of lead, among other chemicals, in electronic products, which affects the composition and packaging of our products. The passage of such requirements in additional jurisdictions, or the tightening of standards or elimination of certain exemptions in jurisdictions where our products are already subject to such requirements, could cause us to incur significant expenditures to make our products compliant with new requirements, or could limit the markets into which we may sell our products. Additionally, given our manufacturing

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operations, increasing efforts to control emissions of greenhouse gases could significantly increase our operating costs.

Risks related to this offering and our common stock

There is no existing market for our common stock and we do not know if one will develop to provide our stockholders adequate liquidity.

There has not been a public trading market for shares of our common stock prior to this offering. An active trading market may not develop or be sustained after this offering. The initial public offering price for the shares of common stock sold in this offering will be determined by negotiations between us and representatives of the underwriters. This price may not be indicative of the price at which our common stock will trade after this offering.

Our financial results may vary significantly from quarter to quarter due to a number of factors, which may lead to volatility in our stock price.

Our quarterly revenue and results of operations have varied in the past and may continue to vary significantly from quarter to quarter. This variability may lead to volatility in our stock price as research analysts and investors respond to these quarterly fluctuations. These fluctuations are due to numerous factors, including:

•

fluctuations in demand for our products;

•

the timing, size and product mix of sales of our products;

•

changes in our pricing and sales policies or the pricing and sales policies of our competitors;

•

our ability to design, manufacture and deliver products to our customers in a timely and cost-efficient manner and that meet customer requirements;

•

quality control or yield problems in our manufacturing operations;

•

our ability to timely obtain adequate quantities of the components used in our products;

•

length and variability of the sales cycles of our products;

•

new product introductions and enhancements by our competitors and ourselves;

•

unanticipated increases in costs or expenses; and

•

fluctuations in foreign currency exchange rates.

The foregoing factors are difficult to forecast, and these, as well as other factors, could materially adversely affect our quarterly and annual results of operations. In addition, a significant amount of our operating expenses is relatively fixed in nature due to our internal manufacturing, research and development, sales and general administrative efforts. Any failure to adjust spending quickly enough to compensate for a revenue shortfall could magnify the adverse impact of such revenue shortfall on our results of operations. Moreover, our results of operations may not meet our announced guidance or the expectations of research analysts or investors, in which case the price of our common stock could decrease significantly. There can be no assurance that we will be able to successfully address these risks.

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Our stock price may be volatile and you may be unable to sell your shares at or above the offering price.

The market price of our common stock could be subject to wide fluctuations in response to, among other things, the risk factors described in this section of this prospectus, and other factors beyond our control, such as fluctuations in the valuation of companies perceived by investors to be comparable to us.

Furthermore, the stock markets have experienced price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many companies. These fluctuations often have been unrelated or disproportionate to the operating performance of those companies. These broad market and industry fluctuations, as well as general economic, political and market conditions, such as recessions, interest rate changes or international currency fluctuations, may negatively affect the market price of our common stock.

In the past, many companies that have experienced volatility in the market price of their stock have been subject to securities class action litigation. We may become the target of this type of litigation in the future. Securities litigation against us could result in substantial costs and divert our management's attention from other business concerns, which could seriously harm our business.

As a result of the foregoing, fluctuations in the market price of our common stock could prevent our investors from selling their shares at or above the offering price.

If research analysts do not publish research about our business or if they issue unfavorable commentary or downgrade our common stock, our stock price and trading volume could decline.

The trading market for our common stock will depend in part on the research and reports that research analysts publish about us and our business. The price of our common stock could decline if one or more research analysts downgrade our stock or if those analysts issue other unfavorable commentary or cease publishing reports about us or our business. If one or more of the research analysts ceases coverage of our company or fails to publish reports on us regularly, demand for our common stock could decrease, which could cause our stock price or trading volume to decline.

Our principal stockholders, executive officers and directors own a significant percentage of our stock and will continue to have significant control of our management and affairs after the offering, and they can take actions that may be against your best interests.

Following the completion of this offering, our executive officers and directors, and entities that are affiliated with them, will beneficially own an aggregate of approximately         % of our outstanding common stock. Our largest stockholder, Jerusalem Venture Partners, will beneficially own an aggregate of approximately         % of our outstanding common stock following completion of this offering. This significant concentration of share ownership may adversely affect the trading price for our common stock because investors often perceive disadvantages in owning stock in companies with controlling stockholders. Also, as a result, these stockholders, acting together, may be able to control our management and affairs and matters requiring stockholder approval, including the election of directors and approval of significant corporate transactions, such as mergers, consolidations, the sale of substantially all of our assets or amendments to our certificate of incorporation or by-laws. Consequently, this

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concentration of ownership may have the effect of delaying or preventing a change in control, including a merger, consolidation or other business combination involving us, or discouraging a potential acquirer from making a tender offer or otherwise attempting to obtain control, even if such a change in control would benefit our other stockholders.

Our stock price could decline due to the large number of outstanding shares of our common stock eligible for future sale.

Sales of substantial amounts of our common stock in the public market following this offering, or the perception that these sales could occur, could cause the market price of our common stock to decline. These sales could also make it more difficult for us to sell equity or equity-related securities in the future at a time and price that we deem appropriate.

Assuming completion of this offering as of             , 2011, we would have had an aggregate of             shares of common stock outstanding, assuming no exercise of the underwriters' over-allotment option and no exercise of outstanding options or warrants. The              shares sold pursuant to this offering will be immediately tradable without restriction. Of the remaining shares:

•

no shares will be eligible for sale immediately upon completion of this offering;

•

shares will be eligible for sale upon the expiration of lock-up agreements, subject in some cases to volume and other restrictions of Rule 144 and Rule 701 under the Securities Act of 1933, as amended, or the Securities Act; and

•

The number of shares eligible for sale upon expiration of lock-up agreements assumes the conversion of all outstanding shares of our Series A Preferred Stock, Series B Preferred Stock, Series B-2 Preferred Stock, Series C Preferred Stock, Series C-1 Preferred Stock into an aggregate of 12,399,825 shares of common stock on a 1-for-1 basis and the conversion of all outstanding shares of our Series B-1 Preferred Stock into an aggregate of 665,013 shares of Common Stock on a one for 1.161144499 basis.

The lock-up agreements expire 180 days after the date of this prospectus, subject to potential extension in the event we release earning results or material news or a material event relating to us occurs near the end of the lock-up period. J.P. Morgan Securities LLC and Barclays Capital Inc., as representatives of the underwriters, may, in their discretion and at any time without notice, release all or any portion of the securities subject to lock-up agreements. After the completion of this offering, we intend to register approximately              shares of our common stock that have been issued or reserved for future issuance under our stock incentive plans.

Because our initial public offering price is substantially higher than the pro forma as adjusted net tangible book value per share of our outstanding common stock, new investors will incur immediate and substantial dilution.

The initial public offering price is substantially higher than the pro forma as adjusted net tangible book value per share of our common stock based on the expected total value of our total assets, less our goodwill and other intangible assets, less our total liabilities immediately following this offering. Therefore, if you purchase shares of our common stock in this offering, you will experience immediate and substantial dilution of $             per share in the price you pay for our common stock as compared to the pro forma as adjusted net tangible book value as of June 30, 2011. To the extent outstanding options or warrants to purchase common stock

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are exercised, there will be further dilution. For a further description of the dilution that you will experience immediately after this offering, see "Dilution."

Our management has broad discretion in the use of the net proceeds from this offering and may not use the net proceeds effectively.

Our management will have broad discretion in the application of the net proceeds of this offering. We cannot specify with certainty the uses to which we will apply the net proceeds we will receive from this offering. The failure by our management to apply these funds effectively could adversely affect our ability to continue to maintain and expand our business.

We currently do not intend to pay dividends on our common stock and, consequently, your only opportunity to achieve a return on your investment is if the price of our common stock appreciates.

We currently do not plan to declare dividends on shares of our common stock in the foreseeable future. See "Dividend policy" for more information. Consequently, your only opportunity to achieve a return on your investment in our company will be if the market price of our common stock appreciates and you sell your shares at a profit. There is no guarantee that the price of our common stock that will prevail in the market after this offering will ever exceed the price that you pay.

Our charter and organizational documents and Delaware law could prevent a takeover that stockholders consider favorable and could also reduce the market price of our stock.

Our amended and restated certificate of incorporation and our amended and restated bylaws, which will be effective upon completion of this offering, contain provisions that could delay or prevent a merger, acquisition or other change in control that stockholders may consider favorable, including transactions in which stockholders might otherwise receive a premium for their shares. These provisions may also prevent or delay attempts by stockholders to replace or remove our current management or members of our board of directors. These provisions include:

•

providing for a classified board of directors with staggered, three-year terms;

•

not providing for cumulative voting in the election of directors;

•

authorizing our board of directors to issue, without stockholder approval, preferred stock rights senior to those of common stock;

•

prohibiting stockholder action by written consent;

•

limiting the persons who may call special meetings of stockholders; and

•

requiring advance notification of stockholder nominations and proposals.

The affirmative vote of the holders of at least 66²/3% of our shares of capital stock entitled to vote, and not less than 66²/3% of the outstanding shares of each class entitled to vote thereon as a class, is generally necessary to amend or repeal the above provisions that are contained in our amended and restated certificate of incorporation. Also, absent approval of our board of directors, our amended and restated by-laws may only be amended or repealed by the affirmative vote of the holders of at least 66²/3% of our shares of capital stock entitled to vote.

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Upon completion of this offering, we will be subject to the provisions of Section 203 of the Delaware General Corporation Law. In general, Section 203 prohibits a publicly held Delaware corporation from engaging in a "business combination" with an "interested stockholder" for a three-year period following the time that this stockholder becomes an interested stockholder, unless the business combination is approved in a prescribed manner.

These and other provisions in our amended and restated certificate of incorporation, our amended and restated bylaws, our 2011 amended and restated investor rights agreement and under Delaware law could discourage potential takeover attempts, reduce the price that investors might be willing to pay for shares of our common stock in the future and result in the market price being lower than it would be without these provisions. See "Description of capital stock—Preferred stock", "Description of capital stock—Anti-takeover effects of Delaware law and our certificate of incorporation and bylaws", and "Certain relationships and related party transactions—Private placement financings—Investor rights agreement."

The right of first negotiation in our 2011 amended and restated investor rights agreement could delay a sale of the company.

We are party to an investor rights agreement that affords Finisar Corporation, one of our stockholders and our largest customer in 2010, a right of first negotiation in the event we seek to solicit, encourage, pursue or negotiate an offer from a non-affiliated third-party purchaser to effect a sale of the company. In the event our board of directors has resolved to pursue such a transaction, we must deliver to Finisar a notice describing the material terms and conditions of the solicited transaction. Finisar then has five days to deliver a negotiation notice if it desires to initiate a process to make an offer to acquire the company. If Finisar fails to deliver the notice, we may proceed towards consummating a transaction with a non-affiliated third party purchaser to effect the sale of the company. If Finisar delivers the notice, we may not enter into an exclusive negotiating or standstill agreement with any third party for 25 days, during which we are required to negotiate with Finisar in good faith towards effecting a sale transaction. If we are unable to come to an agreement with Finisar during this period, we may enter into a sale transaction in respect of the Targeted Solicitation within the next 12 months, subject to extension if we have entered into an agreement and are working in good faith to consummate the sale transaction. In the event we enter into a letter of intent with Finisar regarding a sale transaction, the agreement must include a reasonable break-up fee in favor of Finisar and a reasonable exclusive negotiating or standstill period. The right of first negotiation does not have a specified termination date. Though Finisar's right of first negotiation does not compel us to enter into a sale transaction with Finisar, the right of first negotiation could delay a potential sale of the company.

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Special note regarding forward-looking statements
and industry data

This prospectus contains forward-looking statements that are based on our management's beliefs and assumptions and on information currently available to our management. The forward-looking statements are contained principally in "Prospectus summary," "Risk factors," "Management's discussion and analysis of financial condition and results of operations," "Business" and "Compensation discussion and analysis." Forward-looking statements include information concerning our possible or assumed future results of operations, business strategies, financing plans, competitive position, industry environment, potential growth opportunities and the effects of competition. Forward-looking statements include all statements that are not historical facts and can be identified by terms such as "anticipates," "believes," "could," "seeks," "estimates," "expects," "intends," "may," "plans," "potential," "predicts," "projects," "should," "will," "would" or similar expressions and the negatives of those terms.

Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. We discuss these risks in greater detail in "Risk factors" and elsewhere in this prospectus. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Also, forward-looking statements represent our management's beliefs and assumptions only as of the date of this prospectus. You should read this prospectus and the documents that we have filed as exhibits to the registration statement, of which this prospectus is a part, completely and with the understanding that our actual future results may be materially different from what we expect.

Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

This prospectus also contains estimates and other information concerning our industry, including market size and growth rates, that are based on industry publications, surveys and forecasts, including those generated by Cisco Systems, Dell'Oro and Ovum. This information involves a number of assumptions and limitations, and you are cautioned not to give undue weight to these estimates. These industry publications, surveys and forecasts generally indicate that their information has been obtained from sources believed to be reliable. The industry in which we operate is subject to a high degree of uncertainty and risk due to variety of factors, including those described in "Risk factors."

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Use of proceeds

We estimate that the net proceeds from our sale of                           shares of common stock in this offering at an assumed initial public offering price of $             per share, the midpoint of the price range set forth on the front cover of this prospectus after deducting estimated underwriting discounts and commissions and estimated offering expenses, will be approximately $              million, assuming no exercise by the underwriters of their over-allotment option, or $              million if the underwriters' option to purchase additional shares is exercised in full. A $1.00 increase (decrease) in the assumed initial public offering price would increase (decrease) the net proceeds to us from this offering by $              million, assuming the number of shares offered by us, as set forth on the front cover of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions.

The principal purposes of this offering are to create a public market for our common stock and to facilitate our future access to public equity markets, as well as to obtain additional capital. We have no specific plans as to the use of a specific portion of the proceeds of this offering. However, we anticipate that we will use the net proceeds of this offering primarily for working capital and general corporate purposes and, subject to long-term demand from our customers following completion of this offering, capital expenditures to expand our manufacturing facilities and capabilities. The amount and timing of these expenditures will vary depending on a number of factors, including competitive and technological developments and the rate of growth, if any, of our business.

In addition, we may use a portion of the net proceeds to selectively pursue acquisitions that complement our strengths and help us execute our strategies or use up to $              million to repay some or all of the outstanding amounts under our debt facilities. However, we have no understandings or agreements with respect to any such acquisition or investment or debt repayment.

Pending their use, we plan to invest our net proceeds from this offering in short-term, interest-bearing obligations, investment-grade instruments, certificates of deposit, or direct or guaranteed obligations of the U.S. government.

Dividend policy

We have never declared or paid cash dividends on our common stock. We currently intend to retain all available funds and any future earnings for use in the operation of our business and do not anticipate paying any dividends on our common stock in the foreseeable future. Any future determination to declare dividends will be made at the discretion of our board of directors and will depend on our financial condition, results of operations, capital requirements, general business conditions and other factors that our board of directors may deem relevant. In addition, our debt facility restricts our ability to declare or pay cash dividends on our capital stock.

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Capitalization

The following table sets forth our capitalization as of June 30, 2011 on:

•

an actual basis;

•

on a pro forma basis to give effect to (i) the automatic conversion of all outstanding shares of our Series A Preferred Stock, Series B Preferred Stock, Series B-2 Preferred Stock, Series C Preferred Stock and Series C-1 Preferred Stock into shares of our common stock on a 1-for-1 basis, (ii) the automatic conversion of all outstanding shares of our Series B-1 Preferred Stock into shares of our common stock on a 1-for-1.161144499 basis, (iii) the automatic conversion of all outstanding warrants to purchase preferred stock into warrants to purchase common stock; and (iv) the reclassification of our outstanding preferred stock warrants from long-term liabilities to additional paid-in capital; and

•

on a pro forma as adjusted basis to give effect to the conversion and reclassification described in the prior bullet and (i) the sale by us of the shares of common stock offered by this prospectus at an initial public offering price of $         per share, the midpoint of the price range on the cover of this prospectus, and after deducting the underwriting discounts and commissions and estimated offering expenses payable by us; and (ii) the filing of our amended and restated certificate of incorporation, which will occur immediately prior to the closing of this offering.

The following information is illustrative only of our capitalization following the completion of this offering and will be adjusted based on the actual initial public offering price and other terms of this offering determined at pricing. You should read this table together with "Management's discussion and analysis of financial condition and results of operations" and our financial statements and the related notes appearing elsewhere in this prospectus.

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The number of shares of our common stock to be outstanding following this offering as of June 30, 2011 excludes:

•

1,665,343 shares of common stock issuable upon the exercise of options outstanding as of June 30, 2011, with a weighted average exercise price of $2.92 per share;

•

26,038 shares of common issuable upon the exercise of outstanding warrants, with a weighted average exercise price of $10.03 per share; and

•

shares of our common stock reserved for future issuance under our stock-based compensation plans, including                                        sh ares of common stock reserved for issuance under our 2011 Stock Option and Incentive Plan, which will become effective in connection with this offering, and any future increase in shares reserved for issuance under such plan.

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Dilution

If you invest in our common stock, your interest will be diluted to the extent of the difference between the amount per share paid by purchasers of shares of common stock in this initial public offering and the pro forma as adjusted net tangible book value per share of common stock immediately after completion of this offering.

At June 30, 2011, our pro forma net tangible book value was approximately $        million, or $         per share of common stock. Pro forma net tangible book value per share represents total tangible assets less total liabilities, divided by the number of shares of common stock outstanding after giving effect to (i) the conversion of all outstanding shares of our convertible preferred stock into an aggregate of 13,064,838 shares of our common stock effective immediately prior to the completion of this offering, for a total of 14,359,377 shares of common stock outstanding on June 30, 2011 and (ii) the reclassification of our preferred stock warrant liabilities from long-term liabilities to additional paid-in capital. After giving effect to our sale of             shares of common stock in this offering at an assumed initial public offering price of $             , the midpoint of the price range set forth on the front cover of this prospectus, and after deducting estimated underwriting discounts and commissions and estimated offering expenses, our pro forma as adjusted net tangible book value at June 30, 2011 would have been $             , or $             per share of common stock. This represents an immediate increase in pro forma net tangible book value of $             per share to existing stockholders and an immediate dilution of $             per share to new investors.

The following table illustrates this dilution:

If all our outstanding options had been exercised, the pro forma net tangible book value as of June 30, 2011 would have been $              million, or $             per share, and the pro forma as adjusted net tangible book value after this offering would have been $              million, or $             per share, causing dilution to new investors of $             per share.

The following table summarizes, on a pro forma as adjusted basis as of June 30, 2011, the total number of shares of common stock purchased from us, the total consideration paid to us, and the average price per share paid to us by existing stockholders and by new investors purchasing shares in this offering at the initial public offering price of $             , the midpoint of the price

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range set forth on the front cover of this prospectus, before deducting estimated underwriting discounts and commissions and estimated offering expenses:

The foregoing calculations exclude as of June 30, 2011:

•

1,665,343 shares of common stock issuable upon the exercise of options outstanding as of June 30, 2011, with a weighted average exercise price of $2.92 per share;

•

26,038 shares of common issuable upon the exercise of outstanding warrants, with a weighted average exercise price of $10.03 per share; and

•

shares of our common stock reserved for future issuance under our stock-based compensation plans, including                                        sh ares of common stock reserved for issuance under our 2011 Stock Option and Incentive Plan, which will become effective in connection with this offering, and any future increase in shares reserved for issuance under such plan.

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Selected consolidated financial data

The following selected consolidated financial data should be read together with our financial statements and accompanying notes and "Management's discussion and analysis of financial condition and results of operations" appearing elsewhere in this prospectus. The selected financial data in this section is not intended to replace our financial statements and the related notes. Our historical results are not necessarily indicative of our future results.

We derived the consolidated statements of operations data for each of the three years ended December 31, 2010, 2009 and 2008 and the consolidated balance sheet data as of December 31, 2010 and 2009 from our audited consolidated financial statements appearing elsewhere in this prospectus. The consolidated statements of operations data for the years ended December 31, 2007 and 2006, and the consolidated balance sheet data as of December 31, 2008, 2007 and 2006 are derived from our audited consolidated financial statements that are not included in this prospectus. The consolidated statements of operations data for the six months ended June 30, 2011 and 2010 and the consolidated balance sheet data as of June 30, 2011 are derived from our unaudited condensed consolidated financial statements appearing elsewhere in this prospectus.

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