Contract analysis

From: Alan Ngo <ango@calderwoodharkness.com> To: Sandra Ellison <sellison@optiwavesemi.com> Cc: Marcus Delgado <mdelgado@calderwoodharkness.com> Date: Fri, 29 Apr 2022 10:17:00 -0000 Subject: Re: Board Authorization — Patent Infringement Action Against Lumos Photonics, Inc.

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Thank you for promptly relaying the Board's April 28, 2022 authorization to proceed with filing the patent infringement action against Lumos Photonics, Inc. We are pleased to have the green light and are prepared to move forward expeditiously.

We confirm our understanding that the authorization covers assertion of all four patents-in-suit: U.S. Patent No. 10,234,567 (the '567 Patent); U.S. Patent No. 10,891,234 (the '234 Patent); U.S. Patent No. 11,045,678 (the '678 Patent); and U.S. Patent No. 11,312,890 (the '890 Patent). We also note your confirmation that Vantage Point Capital Partners Fund IV, LP concurred with the Board's authorization, and that the

The engagement letter between Calderwood & Harkness LLP and Optiwave Semiconductor Corp. is being finalized, and we anticipate execution by mid-May. We have reserved matter number 1014-00003 for this action. Our General Counsel's office is completing the conflicts check, which should be cleared shortly. As discussed, the billing arrangement will reflect blended hourly rates with a 10% volume discount on our standard

To keep our timeline on track for an early-June filing, we propose the following action items:

- **Finalize Engagement Letter (Target: Mid-May 2022).** Marcus will circulate a revised draft early next week and coordinate with you on any remaining terms for execution.

- **Complete Pre-Suit Infringement Analysis (Target: Early May 2022).** Omar Siddiqui and Christy Bauer are finalizing the claim-by-claim infringement analyses for all four patents against Lumos's LumosBridge™ 800G Optical Engine and LumosEdge™ 400ZR+ Pluggable Transceiver products. The memoranda for the '567 and '234 Patents are substantially complete. The '678 and '890 Patent memoranda will be finalized in early Ma

- **Finalize Validity Risk Assessment (Target: Mid-May 2022).** We are preparing a consolidated validity assessment covering all four patents, including analysis of key prior art references such as the Tanaka patent (U.S. Patent No. 9,456,012) and other identified references. We expect to complete this assessment by mid-May.

- **Litigation Funding Decision.** We are aware of the pending term sheet from Resolute Litigation Finance, LP. Given Vantage Point's capitalization and the Board-approved budget, our preliminary recommendation is that self-funding is preferable, as it avoids sharing any recovery and preserves full strategic control. Marcus is preparing a brief comparative analysis of the two options and will circulate it for your re

- **Draft Complaint (Target Filing: Early June 2022).** We will prepare the complaint for filing in the U.S. District Court for the Northern District of California, San Jose Division. Venue is supported by Lumos's sales office and engineering center located at 4750 Great America Parkway, Suite 320, Santa Clara, CA 95054. We will circulate a draft to you and Ted for review before filing.

- **Litigation Hold (Target: Prior to Filing).** We will prepare a litigation hold notice for distribution to key Optiwave custodians, including Dr. Priya Ramanathan, Dr. Kevin Fong, Dr. Amara Osei, Ted Marchetti, you, and other individuals involved with the patents-in-suit or who may have relevant communications regarding Lumos. We recommend distributing the hold before the complaint is filed.

- **Lender Notification.** As a reminder, Optiwave's revolving credit facility with First Pacific Commerce Bank, N.A. likely requires notification of material litigation. We recommend preparing a notification letter to FPCB for delivery promptly after filing. We are happy to assist with drafting if that would be useful.

- **Cease-and-Desist Follow-Up.** Optiwave's March 15, 2022 cease-and-desist letter to Lumos (addressing the '567 and '234 Patents) and Lumos's April 4, 2022 response—in which Lumos denied infringement and asserted invalidity—are part of the pre-suit record. We intend to reference this correspondence in the complaint to support allegations of willful infringement.

Given that Vantage Point holds approximately 62% of Optiwave's equity and occupies three of seven Board seats, close coordination on litigation milestones and budget is warranted. We suggest scheduling a brief call with Douglas Fairbanks III and/or Rebecca Torres at Vantage Point to align on litigation strategy and a reporting cadence. Once the pre-suit infringement and validity analyses are finalized in late May, we

On a preliminary basis, we expect Optiwave's damages claim to exceed $75 million, grounded in a reasonable royalty theory applied to Lumos's accused product revenue—approximately $148.6 million in calendar year 2022 per publicly available information—with the potential for willfulness enhancement. We will further develop the damages framework once we formalize expert engagement following the filing.

We have strong confidence in the breadth and quality of Optiwave's patent portfolio and in the merits of this action. Please let us know if there are any additional Board conditions or instructions that we should be aware of as we proceed. I am available to discuss any of the foregoing by phone at your convenience.

Alan Ngo Partner, intellectual Property Group Calderwood & Harkness LLP One Embarcadero Center, 34th Floor San Francisco, CA 94111 T: (415) 772-4100 | D: (415) 772-4138 ango@calderwoodharkness.com

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