Contract analysis

I. Introduction and General Notes A. Purpose This document constitutes an internal attorney work product containing detailed cross-examination outlines prepared for the January 2024 evidentiary hearing in ICC Case No. 27914/MHM. The outlines cover the three Kestrel Dynamics GmbH ("Kestrel" or "Claimant") fact witnesses scheduled to appear at the hearing:

1. Friedrich Brenner — Managing Director / Geschäftsführer of Kestrel Dynamics GmbH;

2. Luisa Erdmann — Commercial Director of Kestrel Dynamics GmbH; and

3. Dr. Stefan Voss — Head of Quality Assurance of Kestrel Dynamics GmbH. The cross-examination outlines have been designed to accomplish two interconnected objectives. First, the outlines support Respondent Whitmore Aerospace LLC's ("WAL" or "Respondent") defense against Kestrel's claims of material breach of the Master Supply Agreement dated June 15, 2018 (Document Reference WAL-KDG-MSA-2018-0615) (the "MSA"), as am

1. Kestrel Was Aware of the Porosity Failures and the Failures Were Genuine. Across all three witnesses, the cross-examination must establish that Kestrel was aware of porosity failures in the rejected lots and that the failures were genuine non-conformances — not fabricated or exaggerated by WAL. Internal Kestrel communications obtained in document production under Procedural Order No. 2 (dated March 17, 2023) refle

2. Kestrel's Cure Efforts Were Insufficient. The cross-examination must demonstrate that Kestrel's cure efforts, to the extent any were undertaken, were insufficient in both scope and timeliness. Amendment No. 2 extended the cure period from 30 to 45 calendar days. Despite this extension, Kestrel failed to cure seven of the fourteen lot rejections within the amended cure period. The cross-examination of all three wit

3. The Porosity Specification Was Clear and Unambiguous. A central pillar of Kestrel's case is the contention that WAL applied an "unpublished" porosity standard of ≤0.15% rather than the contractual standard of ≤0.25% specified in WAL-SPEC-TH-401, Appendix C, Table 3. The cross-examination must expose the inconsistency of this position. None of the three Kestrel witnesses has been able to identify any WAL document,

4. The Valkyr Replacement Theory Is Unsupported by Evidence and Commercially Implausible. Kestrel has advanced the narrative that WAL's true motive in rejecting lots and terminating the MSA was to replace Kestrel with Valkyr Precision Components Inc. as a lower-cost domestic supplier. This theory is both factually unsupported and commercially implausible. The cross-examination will establish that (a) no Kestrel witne

5. Kestrel's Damages Claim of €47.3 Million Is Unsupported. The cross-examination must challenge the credibility and quantum of Kestrel's damages claim across its principal components: (a) lost profits for the remaining MSA term (€12.83 million), (b) lost profits for the two one-year renewal periods (€27.15 million), (c) unreimbursed rework costs (€3.42 million), and (d) reputational damages (€3.90 million). In parti

II. Cross-Examination Outline: Friedrich Brenner (Managing Director / Geschäftsführer) A. Witness Background and Credibility Foundations The initial phase of Brenner's cross-examination should establish his seniority, his personal involvement in the key events, and his status as the ultimate decision-maker at Kestrel. This foundational segment serves two purposes: it prevents Brenner from later claiming ignorance or

1. Mr. Brenner, you are the co-founder of Kestrel Dynamics GmbH, correct? Confirm that Brenner co-founded Kestrel in 2004 and has served as Geschäftsführer (managing director) continuously since that date.

2. As Geschäftsführer, you are the most senior executive decision-maker at Kestrel, are you not? Confirm that Brenner has ultimate responsibility for all commercial and operational matters at Kestrel. He should not be permitted to characterize himself as merely one of several decision-makers if the corporate structure shows him as sole Geschäftsführer or as the senior among co-managing directors. If he claims shared

3. You were personally involved in negotiating the Master Supply Agreement with Whitmore Aerospace LLC, executed on June 15, 2018? Confirm personal involvement. Brenner's first witness statement (¶¶ 4–12) describes his role in the MSA negotiations. Use his own witness statement as the anchor for this confirmation.

4. You signed the MSA on behalf of Kestrel, did you not? Confirm execution. The MSA signature page should be available to present if needed.

5. Before signing the MSA, you reviewed and approved the quality requirements, including the engineering specifications referenced in the MSA? Confirm that Brenner personally reviewed the quality requirements, including WAL-SPEC-TH-401 and its appendices, before executing the MSA. This is essential for the porosity-specification line of questioning that follows.

6. You were personally involved in Kestrel's decisions regarding how to respond to Whitmore Aerospace's lot rejections beginning in March 2022? Confirm personal involvement in the rejection response process. This prevents any later attempt to deflect responsibility to Erdmann or Voss. B. Knowledge of the Porosity Specification This segment is designed to establish, through Brenner's own admissions, that the contractu

1. Mr. Brenner, I'd like to direct your attention to a document in your binder. This is WAL-SPEC-TH-401, Appendix C, Table 3. Do you recognize this document? Present WAL-SPEC-TH-401, Appendix C, Table 3. Confirm that Brenner recognizes the specification. Confirm that this document was part of the package of engineering specifications incorporated by reference into the MSA at the time of execution on June 15, 2018.

2. Table 3 sets forth the maximum permissible porosity for Ti-6Al-4V ELI titanium alloy turbine housings at ≤0.25%, correct? This is a document-driven question; the answer is contained in Table 3 itself. Brenner should confirm. If he attempts to qualify or contextualize, redirect to the plain text of Table 3.

3. You reviewed and approved this specification before Kestrel entered into the MSA, correct? This follows from the foundation established in Section A. If Brenner claims he did not personally review Appendix C, Table 3, follow up: As managing director, you had access to all specifications incorporated into the MSA, did you not? And you had the opportunity to review them before you signed the agreement?

4. After the MSA was executed on June 15, 2018, was any amendment, side letter, or other written instrument ever executed between WAL and Kestrel that changed the porosity specification from ≤0.25% to any other level? Expected answer: No. Confirm that Amendment No. 1 and Amendment No. 2 did not modify the porosity specification. If Brenner suggests an oral modification or course of dealing, note that MSA Section 22.3

5. Mr. Brenner, Kestrel's position in this arbitration is that Whitmore Aerospace applied an "unpublished" standard of ≤0.15% porosity to reject the lots at issue. You are aware of that pleading position? Confirm awareness.

6. Have you ever seen any Whitmore Aerospace document — a specification, a memorandum, an email, a letter, or any other writing — that states a porosity requirement of ≤0.15%? Expected answer: No. If Brenner claims he has seen such a document, demand that he identify it with specificity (date, author, recipient, document number). This document has not appeared in the production and does not appear in the record. If h

7. If the contractual porosity standard was ≤0.25%, and Dr. Raymond Chow's independent analysis found porosity levels ranging from 0.19% to 0.38% in the fourteen rejected lots, then a number of those lots exceeded the contractual limit — do you agree? This is an arithmetic question. Brenner may resist, but the math is straightforward: any lot with porosity above 0.25% exceeded the specification. Note that Dr. Chow fo

8. I'd like to show you [document reference — internal Kestrel communication obtained in production]. This is an email dated [date] from you to Dr. Voss in which you acknowledge that certain lots exhibited porosity levels above 0.25%. Do you recognize this email? Key document: Any internal Kestrel communication (obtained in document production under Procedural Order No. 2) in which Brenner acknowledged porosity level

1. Mr. Brenner, I'd like to walk through the chronology of the lot rejections. The first rejected lot was Lot KDG-2022-0307, rejected by WAL on or about March 7, 2022. Do you recall that? Establish the starting point. Then walk through the chronology of all 14 lot rejections from Lot KDG-2022-0307 through Lot KDG-2022-0919. The goal is to impress upon the Tribunal the volume and frequency of the rejections over a six

2. You received WAL's rejection notices for each of these fourteen lots, did you not? Confirm receipt. If Brenner claims the notices went to Erdmann or Voss rather than directly to him, follow up: But you were informed of each rejection, were you not? As managing director, lot rejections of this magnitude were brought to your attention?

3. I'd like to show you [document reference — internal Kestrel email/memorandum]. This is a [date] communication in which you discuss the quality problems with the rejected lots. Do you recognize this document? Present any internal Kestrel emails or memoranda in which Brenner acknowledged quality issues, discussed root-cause analysis, or expressed concern about the pattern of rejections. Walk through each relevant do

4. After the first rejections in March 2022, did you direct any specific corrective action to address the porosity issues? If yes, ask what specific corrective actions were directed. Follow up by asking why those actions failed to prevent subsequent rejections. If no, establish that the managing director failed to direct corrective action after the first sign of quality problems.

5. Between March and September 2022, Kestrel had fourteen lots rejected — a total of 1,680 units. Over that six-month period, did you implement any effective corrective measures that stopped the pattern of rejections? The answer must be no, because the rejections continued through September 2022. Regardless of what corrective measures Brenner claims were taken, the objective fact is that the rejections did not stop.

6. Was Kestrel's AS9100 Rev D certification ever at risk due to these quality failures? This question probes the severity of the quality issues from a regulatory/certification perspective. If Brenner says no, follow up: Fourteen lot rejections in six months — representing 1,680 non-conforming units — and Kestrel's AS9100 certification was never at risk? Were there any internal audit findings related to these quality

1. Mr. Brenner, you are familiar with Amendment No. 2 to the MSA, dated September 3, 2021? Confirm familiarity.

2. Amendment No. 2 extended the cure period for rejected lots from 30 calendar days to 45 calendar days, correct? Confirm. This extension was actually a concession negotiated by Kestrel, which underscores that Kestrel understood the importance of the cure mechanism and sought additional time.

3. Despite the extended 45-day cure period, Kestrel failed to replace or rework seven of the fourteen rejected lots within 45 calendar days. You are aware of that, are you not? Confirm. If Brenner disputes the number, present the cure-tracking spreadsheet or rejection-response correspondence for each of the seven uncured lots.

4. For each of those seven uncured rejections, can you tell the Tribunal what specific steps Kestrel took to attempt to cure? This is an open question designed to test the depth and credibility of Brenner's account of cure efforts. For each uncured rejection, probe: Was a replacement lot manufactured? Was the rejected lot reworked? What was the timeline? Why did the cure fail? What resources were allocated?

5. Mr. Brenner, you are familiar with Section 8.4 of the MSA, which defines "Persistent Quality Failure"? Confirm familiarity.

6. Section 8.4 provides that a Persistent Quality Failure exists when there are three or more uncured rejections in any rolling twelve-month period. You understood that provision, correct? Confirm understanding.

7. Seven uncured rejections in a six-month period far exceeded the three-rejection threshold, did it not? This is an arithmetic question. Seven exceeds three. Brenner must concede.

8. Before WAL issued its Notice of Termination for Cause on October 3, 2022, did Kestrel ever communicate to WAL — in writing or otherwise — that Kestrel disputed the applicability of Section 8.4? Expected answer: No. If Brenner claims there was such a communication, ask him to identify it with specificity. The absence of any contemporaneous challenge to the applicability of § 8.4 is a powerful point: Kestrel raised

1. Mr. Brenner, it is Kestrel's position in this arbitration that Whitmore Aerospace's true motive in rejecting the lots and terminating the MSA was to replace Kestrel with a lower-cost domestic supplier — Valkyr Precision Components Inc. in Tucson, Arizona. You are aware of that position? Confirm awareness. Brenner's first witness statement advances this theory.

2. Do you have personal knowledge of when WAL first contacted Valkyr Precision Components? Expected answer: No. If Brenner claims to have such knowledge, ask the basis — did he see a document? Was he told by someone at WAL? By whom, and when?

3. I'd like to show you [WAL timeline document]. WAL's records show that its first contact with Valkyr occurred on [date], which was after the quality failures began in March 2022. Is there anything in Kestrel's possession that contradicts this timeline? Establish that WAL's engagement with Valkyr was a mitigation measure undertaken in response to Kestrel's quality failures, not a preexisting plan to replace Kestrel.

4. Mr. Brenner, you are aware that Valkyr's unit price for the same turbine housings is €8,432.92 per unit? Confirm.

5. And Kestrel's price in Contract Year 4 was €5,222.92 per unit, correct? Confirm.

6. That is a difference of approximately €3,210 per unit — Valkyr charges more than 61% more than Kestrel charged in CY4. You would agree with that arithmetic? Confirm. The math is straightforward: (€8,432.92 − €5,222.92) / €5,222.92 = approximately 61.5%.

7. Valkyr offered WAL an introductory discount of 4.2%, bringing the effective price to approximately €8,078.74 per unit. Even with that discount, Valkyr's price is still approximately €2,855.82 per unit more than Kestrel's CY4 price. You would agree? Confirm. Calculation: €8,432.92 × 0.958 = approximately €8,078.74; €8,078.74 − €5,222.92 = approximately €2,855.82.

8. Mr. Brenner, would it be commercially rational for a company to replace a supplier charging €5,222.92 per unit with a supplier charging more than €8,000 per unit if the motivation were simply to reduce costs? Expected answer: reluctant concession that it would not be rational, or an attempt to explain around the pricing. Either way, the pricing differential speaks for itself. F. Damages and Commercial Position Thi

1. Mr. Brenner, the MSA provides for an initial five-year term with two one-year renewal options. You are aware of that? Confirm.

2. Those renewal options are exercisable solely at WAL's discretion — WAL has the unilateral right to decide whether to renew. Correct? Confirm. MSA Section [specific section] provides that the renewal options are exercisable by written notice from WAL, at WAL's sole discretion. There is no corresponding right on Kestrel's part to compel renewal.

3. Did WAL ever communicate to you — in writing or orally — an intent to exercise either renewal option? Expected answer: No. If Brenner claims there was such a communication, demand specifics: when, by whom, in what form.

4. Yet Kestrel's damages claim includes €27.15 million in lost profits for the two renewal periods. That figure assumes WAL would have exercised both renewal options, does it not? Confirm that the renewal-period claim is premised on an assumption of renewal that is unsupported by any binding commitment or express communication of intent.

5. Prof. Langfeld's damages analysis assumes a 22.4% profit margin for Kestrel's production of turbine housings under the MSA. Are you familiar with that assumption? Confirm familiarity.

6. What were Kestrel's actual profit margins on the WAL contract for Contract Years 1 through 4? Probe actual vs. assumed margins. If Brenner does not know the specific numbers, note that he is the managing director and should be familiar with the profitability of a major contract. If the actual margins differ from the 22.4% assumption, highlight the discrepancy.

7. Kestrel's total annual revenue for fiscal year 2022 was approximately €312 million. You can confirm that? Confirm.

8. What percentage of Kestrel's total annual revenue was attributable to the WAL contract? Probe revenue concentration. At a CY4 price of €5,222.92 per unit and assuming volumes between 2,400 and 3,600 units, the WAL contract generated between approximately €12.5 million and €18.8 million in annual revenue — representing between approximately 4% and 6% of Kestrel's total revenue. This context is relevant to both the

9. Kestrel claims €3.90 million in reputational damages. Mr. Brenner, can you identify any specific customer that Kestrel lost as a direct result of WAL's termination of the MSA? Expected answer: vague or no specific identification. If Brenner identifies a customer, demand the name, the date of the lost business, the value of the lost contract, and any documentation of the customer's stated reason for not doing busin

1. Mr. Brenner, you received WAL's Notice of Termination for Cause, dated October 3, 2022? Confirm receipt.

2. The notice cited Persistent Quality Failure under Section 14.2(b) as the basis for termination? Confirm.

3. After receiving that notice, did Kestrel respond with any proposal to cure the quality failures or to resolve the dispute commercially? Expected answer: No, or at most a brief acknowledgment letter. The key point is the absence of any cure proposal or commercial resolution effort.

4. Kestrel filed its Request for Arbitration with the ICC on November 7, 2022 — just 35 days after the termination notice. Correct? Confirm the timeline.

5. In those 35 days, rather than attempting to cure the outstanding quality failures or engage in commercial discussions with WAL, Kestrel retained Haber Reinhardt Schlosser, prepared a Request for Arbitration, and filed it with the ICC. Is that a fair characterization of what happened in those 35 days? The point is clear: Kestrel prioritized litigation over cure. This is consistent with the broader theme that Kestre