Contract analysis

I. Introduction & Purpose of Letter We write to thank you and the entire Halcyon team for retaining Calderwood & Harkness LLP in connection with the review by the Committee on Foreign Investment in the United States ("CFIUS") of Halcyon Semiconductor AG's ("HSAG") proposed acquisition of one hundred percent (100%) of the outstanding equity of Marlowe Asset Management Photonics Inc. ("VPI"). We appreciate the confiden

II. CFIUS Jurisdiction Analysis A. Overview of CFIUS Authority CFIUS is an interagency committee of the United States government, chaired by the U.S. Department of the Treasury, that is authorized to review certain transactions involving foreign investment in U.S. businesses for their potential implications for U.S. national security. CFIUS comprises representatives from nine federal departments and agencies, includi

III. CFIUS Process Overview & Anticipated Timeline A. Overview of the CFIUS Review Process The CFIUS review process consists of three principal phases, each of which is described below: Phase 1: Pre-Filing Consultation. Before formally submitting a joint voluntary notice, it is standard practice — and strongly recommended by Treasury — for the parties to engage in an informal pre-filing consultation with Treasury's O

IV. Key National Security Risk Factors Based on our preliminary review of VPI's business, HSAG's corporate structure and global operations, and our experience with comparable CFIUS reviews, we have identified seven principal risk factors that we expect CFIUS to focus on during its review and investigation. We discuss each in turn below. A. Foreign Access to Classified Defense Programs This is likely to be the single

V. Recommended Mitigation Framework Based on our review of recent semiconductor-sector NSA precedents — including several transactions in which we represented the acquiring party — and our preliminary assessment of VPI's business, we anticipate that CFIUS will require a comprehensive National Security Agreement as a condition of clearing this transaction. The following is our initial assessment of the types of mitiga

VI. CFIUS Engagement Team We are pleased to confirm the following Calderwood & Harkness attorneys who have been assigned to the CFIUS and related workstreams for this engagement. This team brings deep experience in CFIUS filings, national security reviews, government contracts, export controls, and semiconductor-sector transactions. A. Lead CFIUS / National Security Counsel Margaret "Peggy" Ashworth — Of Counsel, Nat

VII. Engagement Terms A. Scope. The scope of the CFIUS engagement encompasses the following activities: (a) pre-filing consultation with Treasury OIS, including preparation of the pre-filing briefing deck and attendance at the pre-filing meeting; (b) preparation and filing of the voluntary joint notice under 31 C.F.R. Part 800, including all required exhibits, certifications, and supporting documentation; (c) respons

VIII. Immediate Next Steps We recommend the following immediate action items to maintain momentum on the CFIUS process and position the parties for a timely filing. We have assigned target dates for each action item:

1. Pre-Filing Consultation Request (Target: June 15, 2023). Peggy Ashworth will send a formal request letter to Treasury OIS requesting an informal pre-filing consultation meeting. We are targeting the week of June 19, 2023, for the meeting. The request letter will provide Treasury with a high-level overview of the transaction, the parties, and the key national security issues, and will identify the CFIUS counsel for

2. Information Gathering (Target: June 16, 2023). Calderwood & Harkness will circulate comprehensive information request lists to both HSAG and VPI (through its counsel at Wethersfield & Gale) identifying the data, documents, and information needed to prepare the joint voluntary notice. Our information requests will focus on the following areas in particular: (a) HSAG's complete corporate structure, ownership, and an

3. Pre-Filing Briefing Deck (Target: June 19–23, 2023). We will prepare a slide presentation for the Treasury pre-filing consultation meeting, summarizing the transaction, the parties, VPI's business and national security profile, HSAG's background and allied-nation status, and HSAG's proposed mitigation framework. The briefing deck will be designed to provide Treasury OIS with a clear and comprehensive overview of t

4. Seller's Counsel Coordination (Target: June 16, 2023). Peggy Ashworth will contact Harrison Whitfield at Wethersfield & Gale to establish a regular communication cadence, coordinate the division of responsibilities for the joint filing, and exchange initial drafts and outlines for the notice.

5. Notice Preparation (Target: Draft by July 7, 2023; Filing by July 14, 2023). We will begin drafting the joint voluntary notice immediately upon receipt of the information identified in Item 2 above. Our target is to complete a draft notice for internal review by early July 2023, with filing targeted for July 14, 2023. The notice will be a comprehensive document, typically ranging from 75 to 150 pages (excluding ex

6. German Counsel Coordination (Ongoing). We understand that HSAG has retained Schilling Frey Rechtsanwälte in Berlin (lead partner: Prof. Dr. Ulrich Schilling) for German regulatory filings and any EU foreign investment screening requirements that may apply to this transaction. Several EU member states, including Germany, have adopted foreign direct investment screening mechanisms that may require parallel filings.

IX. Confidentiality and Privilege Reminder We wish to underscore the importance of maintaining the confidentiality and privilege of all communications relating to the CFIUS process. All communications between Calderwood & Harkness and HSAG relating to the CFIUS filing, review, investigation, and mitigation negotiation are protected by the attorney-client privilege and the work product doctrine. These protections are

X. Closing Stefan, we are confident in our ability to navigate the CFIUS process successfully and to achieve a favorable outcome for HSAG. While the national security issues presented by this transaction are significant and will require careful management, we believe that several important factors weigh in HSAG's favor. First, HSAG is headquartered in Germany, a NATO ally and EU member state with a long history of de