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RESOLUTIONS OF THE PRICING COMMITTEE OF THE BOARD OF DIRECTORS OF OPTIWAVE SEMICONDUCTOR CORP.

Adopted by Written Consent in Lieu of Meeting

May 23, 2023

The undersigned, being all of the members of the Pricing Committee (the "Pricing Committee") of the Board of Directors (the "Board") of Optiwave Semiconductor Corp., a Delaware corporation (the "Company" or "OWS"), acting pursuant to authority delegated by the Board and in accordance with Section 141(c) of the General Corporation Law of the State of Delaware and the Company's Amended and Restated Bylaws, do hereby adopt the following resolutions by written consent in lieu of a meeting, effective as of May 23, 2023:

RECITALS

WHEREAS, the Board of Directors of the Company, by resolutions duly adopted on May 19, 2023 (the "Board Resolutions"), authorized the issuance and sale of up to $287,500,000 aggregate principal amount of the Company's 2.75% Convertible Senior Notes due 2028 (the "Notes") in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and the transactions related thereto;

WHEREAS, the Board Resolutions authorized the execution and delivery of: (i) an Indenture (the "Indenture") between the Company and Broadmere Trust Company, N.A., as trustee (the "Trustee"), governing the terms, conditions, and covenants of the Notes; (ii) a Purchase Agreement (the "Purchase Agreement") among the Company and Ridgepoint Capital Markets LLC ("Ridgepoint"), as representative of the initial purchasers named therein, including Harborstone Securities Inc. ("Harborstone") and Velthorn Zanthor & Co. ("Velthorn Zanthor" and, together with Ridgepoint and Harborstone, the "Initial Purchasers"), pursuant to which the Initial Purchasers would agree to purchase the Notes from the Company for resale to qualified institutional buyers in accordance with Rule 144A; and (iii) capped call transactions (the "Capped Call Transactions") with Ridgepoint Capital Markets LLC, acting in its principal capacity, and Northvane Financial Products LP (together, the "Capped Call Counterparties"), intended to offset potential dilution to the Company's common stock, par value $0.001 per share (the "Common Stock"), or offset any cash payments the Company may be required to make in excess of the principal amount, in each case upon any conversion of the Notes;

WHEREAS, the Board Resolutions delegated to a Pricing Committee of the Board (the "Pricing Committee"), consisting of Marcus Harding, the Company's Chief Executive Officer, and Priya Nandakumar, the Company's Chief Financial Officer, the authority to determine and approve the final pricing terms of the Notes and the Capped Call Transactions, in each case within the parameters and ranges established by the Board Resolutions, including without limitation the authority to determine the aggregate principal amount, the coupon rate, the initial conversion rate, the initial conversion price, the cap price for the Capped Call Transactions, the initial purchasers' discount, and such other pricing-related terms as the Pricing Committee may deem necessary or advisable;

WHEREAS, the Pricing Committee has reviewed the proposed final pricing terms of the Notes and the Capped Call Transactions in consultation with the Company's financial advisor and lead initial purchaser, Ridgepoint Capital Markets LLC, and the Company's outside legal counsel, Calderwood & Harkness LLP, and has considered, among other things, prevailing market conditions, recent comparable convertible debt offerings in the semiconductor and technology sectors, indicative pricing from the book-building process, and the potential impact of the offering and the Capped Call Transactions on the Company's capital structure, dilution to existing stockholders, and overall cost of capital;

WHEREAS, the Pricing Committee has determined that the final pricing terms set forth herein are within the parameters authorized by the Board Resolutions and are fair, reasonable, and in the best interests of the Company and its stockholders; and

WHEREAS, the closing sale price of the Company's Common Stock on the Nasdaq Global Select Market on May 23, 2023 (the "Pricing Date") was $73.38 per share (the "Reference Price").

NOW, THEREFORE, BE IT RESOLVED, that the Pricing Committee hereby adopts the following resolutions:

RESOLVED CLAUSES

Resolution 1: Approval of Final Pricing Terms of the Notes

RESOLVED, that the Pricing Committee hereby approves and determines the following final pricing terms of the Notes, which terms shall be reflected in the Indenture, the Purchase Agreement, and such other transaction documents as are necessary or appropriate to give effect thereto:

(a) Aggregate Principal Amount (Base Offering). The aggregate principal amount of Notes to be issued and sold in the base offering shall be $250,000,000.

(b) Over-Allotment Option. The Initial Purchasers shall be granted an option, exercisable in whole or in part at any time within 13 calendar days after the closing date of the offering, to purchase up to an additional $37,500,000 aggregate principal amount of Notes (representing 15% of the base offering amount), for a maximum total aggregate principal amount of $287,500,000 if such option is exercised in full (the "Over-Allotment Option").

(c) Coupon Rate. The Notes shall bear interest at a rate of 2.75% per annum, payable semi-annually in arrears on June 1 and December 1 of each year, commencing on December 1, 2023. Interest shall be computed on the basis of a 360-day year consisting of twelve 30-day months.

(d) Maturity Date. The Notes shall mature on June 1, 2028, unless earlier repurchased, redeemed, or converted in accordance with the terms of the Indenture.

(e) Initial Conversion Rate. The initial conversion rate for the Notes shall be 10.5820 shares of Common Stock per $1,000 principal amount of Notes, subject to adjustment as provided in the Indenture.

(f) Initial Conversion Price. The initial conversion price for the Notes shall be approximately $94.50 per share (calculated as $1,000 divided by the initial conversion rate of 10.5820), representing an approximate 28.8% premium over the Reference Price of $73.38 per share.

(g) Net Share Settlement. The Company shall have the right to elect to settle conversions of the Notes through a combination of cash and shares of Common Stock, with cash to be paid in respect of the principal amount of the Notes being converted and shares of Common Stock (or, at the Company's election, cash or a combination of cash and shares) to be delivered in respect of any conversion value in excess of the principal amount, in each case as more fully described in the Indenture (the "Net Share Settlement" method). The Company's initial election shall be to settle conversions using the Net Share Settlement method, and any change to such election shall require further authorization by the Board or a duly authorized committee thereof.

(h) CUSIP (144A). The CUSIP number assigned to the Notes offered and sold pursuant to Rule 144A shall be 683742AA5.

(i) ISIN (144A). The ISIN assigned to the Notes offered and sold pursuant to Rule 144A shall be US683742AA53.

(j) Fundamental Change and Make-Whole Provisions. The Notes shall include a fundamental change repurchase right and a make-whole fundamental change adjustment to the conversion rate, in each case as set forth in the form of Indenture previously reviewed and approved by the Board in connection with the Board Resolutions.

(k) Ranking. The Notes shall be senior, unsecured obligations of the Company, ranking senior in right of payment to all of the Company's indebtedness that is expressly subordinated in right of payment to the Notes; equal in right of payment with all of the Company's existing and future unsecured indebtedness that is not so subordinated; effectively subordinated to all of the Company's existing and future secured indebtedness, to the extent of the value of the assets securing such indebtedness; and structurally subordinated to all existing and future indebtedness and other liabilities of the Company's subsidiaries.

FURTHER RESOLVED, that the foregoing pricing terms are within the parameters established by the Board Resolutions and are hereby confirmed and ratified.

Resolution 2: Approval of Optional Redemption Terms

RESOLVED, that the Pricing Committee hereby confirms and approves the optional redemption terms applicable to the Notes as set forth in the Indenture, which shall provide as follows:

(a) The Notes shall not be redeemable by the Company at the Company's option prior to June 6, 2026.

(b) On or after June 6, 2026, the Company may redeem for cash all or any portion (subject to certain minimum denomination requirements) of the Notes at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date; provided, that the Company may not exercise such optional redemption right unless the last reported sale price of the Company's Common Stock on the Nasdaq Global Select Market (or such other national securities exchange on which the Common Stock is then listed) has exceeded 130% of the conversion price then in effect (which, based on the initial conversion price of approximately $94.50, would be approximately $122.85 per share) for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading-day period ending on, and including, the trading day immediately preceding the date on which the Company provides the notice of redemption.

(c) Upon any such optional redemption, holders of Notes called for redemption shall have the right to convert their Notes at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date, in accordance with the terms of the Indenture.

Resolution 3: Approval of Initial Purchasers' discount and Structuring Fee

RESOLVED, that the Pricing Committee hereby approves the following compensation arrangements with the Initial Purchasers in connection with the offering:

(a) Initial Purchasers' discount. The Initial Purchasers shall receive a discount equal to 2.00% of the aggregate principal amount of Notes purchased by the Initial Purchasers, calculated as follows:

(i) With respect to the base offering: $250,000,000 × 2.00% = $5,000,000;

(ii) With respect to the Over-Allotment Option (if exercised in full): $37,500,000 × 2.00% = $750,000; and

(iii) Total Initial Purchasers' discount (assuming the Over-Allotment Option is exercised in full): $5,750,000.

(b) Allocation of discount Among Initial Purchasers. The Initial Purchasers' discount shall be allocated among the Initial Purchasers as follows (in each case calculated assuming full exercise of the Over-Allotment Option):

(i) Ridgepoint Capital Markets LLC: 60% ($3,450,000);

(ii) Harborstone Securities Inc.: 25% ($1,437,500); and

(iii) Velthorn Zanthor & Co.: 15% ($862,500).

In the event the Over-Allotment Option is exercised only in part or is not exercised at all, the foregoing allocation percentages shall remain the same, applied to the total discount amount actually payable based on the aggregate principal amount of Notes actually purchased.

(c) Structuring Fee. In addition to the Initial Purchasers' discount described above, the Company shall pay to Ridgepoint Capital Markets LLC a structuring fee equal to 0.25% of the base offering principal amount of $250,000,000, or $625,000. The structuring fee shall be payable on the closing date of the offering and shall be separate from, and in addition to, the Initial Purchasers' discount. The structuring fee is being paid in recognition of Ridgepoint Capital Markets LLC's role as sole structuring agent for the offering and the Capped Call Transactions.

FURTHER RESOLVED, that the aggregate compensation payable to the Initial Purchasers (including the structuring fee) is fair and reasonable in light of the nature and size of the offering, prevailing market conditions, and the services to be rendered by the Initial Purchasers.

Resolution 4: Approval of Capped Call Transaction Terms

RESOLVED, that the Pricing Committee hereby approves the final terms of the Capped Call Transactions to be entered into with the Capped Call Counterparties, as follows:

(a) Purpose. The Capped Call Transactions are intended to offset potential dilution to the Common Stock (or offset any cash payments in excess of the principal amount of the Notes that the Company may be required to make) upon any conversion of the Notes, with such offset effective up to the cap price described below, thereby increasing the effective conversion price from the perspective of the Company's existing stockholders.

(b) Counterparties and Allocation. The Capped Call Transactions shall be entered into with the following counterparties, with the aggregate notional amount allocated as follows:

(i) Ridgepoint Capital Markets LLC (acting in its principal capacity, and not as agent for the Company or any other party): 60% of the aggregate notional amount; and

(ii) Northvane Financial Products LP: 40% of the aggregate notional amount.

(c) Lower Strike Price. The lower strike price of the Capped Call Transactions shall be equal to the initial conversion price of the Notes, which is approximately $94.50 per share, subject to anti-dilution adjustments substantially similar to those applicable to the Notes under the Indenture.

(d) Cap Price (Upper Strike). The cap price of the Capped Call Transactions shall be $110.07 per share, representing a 50.0% premium over the Reference Price of $73.38 per share. The cap price shall be subject to certain adjustments as set forth in the applicable capped call confirmations.

(e) Effective Conversion Price with Capped Call. Taking into account the Capped Call Transactions, the effective conversion price of the Notes from the Company's perspective shall be approximately $110.07 per share. Accordingly, no dilution to the Common Stock (or excess cash payments) will occur upon conversion of the Notes unless the market price of the Common Stock exceeds the cap price at the time of conversion.

(f) Aggregate Cost of Capped Call Transactions. The aggregate premium to be paid by the Company for the Capped Call Transactions shall be $28,750,000, allocated between the Capped Call Counterparties as follows:

(i) Ridgepoint Capital Markets LLC: $17,250,000 (representing 60% of $28,750,000); and

(ii) Northvane Financial Products LP: $11,500,000 (representing 40% of $28,750,000).

The aggregate premium shall be payable on the closing date of the offering of the Notes out of the proceeds thereof. In the event the Over-Allotment Option is exercised, additional capped call transactions may be entered into with the Capped Call Counterparties at the same per-share cost, with such additional premium payable on the settlement date for such Over-Allotment Option exercise.

(g) Expiration. The Capped Call Transactions shall expire on June 1, 2028, matching the maturity date of the Notes, subject to earlier exercise upon conversion of the Notes, early termination upon the occurrence of certain extraordinary events, or other termination events as set forth in the applicable confirmations.

(h) Documentation. The Capped Call Transactions shall be documented under 2002 ISDA Master Agreements (together with the related Schedules) and Confirmations between the Company and each Capped Call Counterparty. Each such 2002 ISDA Master Agreement, Schedule, and Confirmation shall be governed by and construed in accordance with the laws of the State of New York, without regard to conflicts of laws principles thereof (other than Section 5-1401 of the New York General Obligations Law).

(i) Collateral and Credit Support. The Capped Call Transactions shall be unsecured obligations of the respective Capped Call Counterparties, and the Company shall not be required to post collateral or provide any credit support in connection therewith.

FURTHER RESOLVED, that the terms of the Capped Call Transactions, including the aggregate premium, are fair and reasonable in light of current market conditions, comparable capped call transactions in recent convertible debt offerings, and the anticipated benefits to the Company and its stockholders in the form of reduced dilution.

Resolution 5: Approval of Use of Proceeds

RESOLVED, that the Pricing Committee hereby confirms that the net proceeds of the offering of the Notes shall be applied as set forth below, consistent with the disclosures to be included in the Offering Memorandum:

(a) The estimated sources and uses of proceeds from the offering (assuming full exercise of the Over-Allotment Option) are as follows:

(b) The estimated offering expenses of approximately $1,200,000 include, without limitation, legal fees and expenses of the Company's outside counsel, fees and expenses of the Trustee and its counsel, accounting fees, printing and EDGAR filing expenses, rating agency fees (if applicable), and other miscellaneous expenses.

(i) Revolving Credit Facility Repayment. Approximately $75,000,000 shall be applied to the repayment of outstanding borrowings under the Company's $300,000,000 senior secured revolving credit facility (the "Revolving Credit Facility"), for which Crestline National Bank, N.A. serves as administrative agent. As of the Pricing Date, $75,000,000 was outstanding under the Revolving Credit Facility. Following such repayment, the Company will have $300,000,000 of availability under the Revolving Credit Facility (subject to the terms and conditions thereof). Borrowings under the Revolving Credit Facility bear interest at a rate of, at the Company's election, the Secured Overnight Financing Rate ("SOFR") plus a margin of 1.50% per annum or an alternate base rate plus a margin of 0.50% per annum.

(ii) General Corporate Purposes. The remainder of the net proceeds, estimated to be approximately $176,800,000, shall be used for general corporate purposes, including, without limitation, working capital, research and development expenditures, potential acquisitions of complementary businesses, technologies, or assets, and capital expenditures related to the Company's semiconductor fabrication and design facilities.

FURTHER RESOLVED, that the Company's officers are authorized to modify the allocation of net proceeds among the foregoing uses in their reasonable business judgment, subject to applicable disclosure obligations, and provided that any such modification is consistent with the Company's publicly disclosed intended use of proceeds.

Resolution 6: Authorization to Execute Final Transaction Documents

RESOLVED, that the Pricing Committee hereby authorizes and directs each of the following officers of the Company (each, an "Authorized Officer"), acting individually or together, to execute, deliver, and perform on behalf of the Company all documents, instruments, agreements, and certificates as may be necessary or advisable to consummate the offering and the transactions contemplated by these resolutions and the Board Resolutions:

• Marcus Harding, Chief Executive Officer

• Priya Nandakumar, Chief Financial Officer

• David Shih, General Counsel and Corporate Secretary

• Rachel Fontaine, Treasurer

FURTHER RESOLVED, that without limiting the generality of the foregoing, each Authorized Officer is hereby authorized and directed to:

(a) Execute and deliver the Purchase Agreement with the Initial Purchasers, reflecting the pricing terms approved herein, with a signing date of May 24, 2023 and a closing date of May 30, 2023 (the "Closing Date"), in substantially the form previously reviewed by the Board and approved in connection with the Board Resolutions, with such changes, modifications, and amendments as the Authorized Officer executing the same shall approve, such approval to be conclusively evidenced by such officer's execution thereof;

(b) Execute and deliver the Indenture with Broadmere Trust Company, N.A., as Trustee, on the Closing Date, in substantially the form previously reviewed by the Board and approved in connection with the Board Resolutions, with such changes, modifications, and amendments as the Authorized Officer executing the same shall approve, such approval to be conclusively evidenced by such officer's execution thereof;

(c) Execute and deliver the Notes in global form to be authenticated by the Trustee and deposited with The Depository Trust Company or its nominee on the Closing Date;

(d) Execute and deliver the 2002 ISDA Master Agreements, Schedules, and Capped Call Confirmations with each of Ridgepoint Capital Markets LLC and Northvane Financial Products LP, reflecting the capped call transaction terms approved herein, with such changes, modifications, and amendments as the Authorized Officer executing the same shall approve, such approval to be conclusively evidenced by such officer's execution thereof;

(e) Execute and deliver all officers' certificates, secretary's certificates, instruction letters, opinion back-up certificates, representation letters, comfort letter bring-down requests, closing certificates, and other closing documents and deliverables as may be necessary, advisable, or customary in connection with the offering and the related transactions;

(f) File or cause to be filed a supplemental listing application with the Nasdaq Stock Market LLC for up to approximately 3,042,325 shares of Common Stock issuable upon conversion of the Notes (including shares issuable upon conversion of Notes issued upon exercise of the Over-Allotment Option in full), calculated based on the initial conversion rate of 10.5820 shares per $1,000 principal amount applied to the maximum aggregate principal amount of $287,500,000;

(g) Make or cause to be made any filings with the U.S. Securities and Exchange Commission on Form 8-K or otherwise as may be required or advisable in connection with the offering and the transactions contemplated hereby;

(h) Reserve or cause to be reserved for issuance from the Company's authorized but unissued shares of Common Stock a sufficient number of shares to satisfy the Company's conversion obligations under the Notes; and

(i) Take all such further actions and execute all such further instruments, agreements, certificates, and documents as any such Authorized Officer may determine, in his or her sole discretion, to be necessary, advisable, or appropriate to consummate and give full force and effect to the transactions contemplated by these resolutions, the Board Resolutions, and the transaction documents described herein.

FURTHER RESOLVED, that the execution by any Authorized Officer of any document, instrument, agreement, or certificate contemplated by these resolutions shall be conclusive evidence that such Authorized Officer has determined, on behalf of the Company, that such document, instrument, agreement, or certificate is necessary or advisable in connection with the transactions contemplated hereby, and the approval of the form and substance thereof shall be conclusively established by such execution.

Resolution 7: Ratification

RESOLVED, that any and all actions heretofore taken by any officer, director, employee, or authorized representative of the Company in connection with the matters contemplated by these resolutions and the Board Resolutions, including, without limitation, the preparation and distribution of the Preliminary Offering Memorandum, the engagement of the Initial Purchasers, the engagement of the Capped Call Counterparties, the engagement of outside counsel and other advisors, the negotiation of the transaction documents, and the conduct of the book-building process and investor communications, are hereby ratified, confirmed, approved, and adopted in all respects as the acts and deeds of the Company.

Resolution 8: Effective Date

RESOLVED, that these resolutions shall be effective as of May 23, 2023, the Pricing Date, and shall remain in full force and effect until the transactions contemplated hereby are consummated or until these resolutions are amended, modified, or rescinded by subsequent action of the Board or the Pricing Committee.

FURTHER RESOLVED, that these resolutions may be executed in one or more counterparts, including by facsimile or electronic transmission (including .pdf format), each of which shall be deemed an original and all of which together shall constitute one and the same instrument.

[Signature Page Follows]

SIGNATURE PAGE TO RESOLUTIONS OF THE PRICING COMMITTEE OF THE BOARD OF DIRECTORS OF OPTIWAVE SEMICONDUCTOR CORP.

IN WITNESS WHEREOF, the undersigned members of the Pricing Committee of the Board of Directors of Optiwave Semiconductor Corp. have executed these resolutions by written consent as of the date first set forth above, effective as of May 23, 2023.

PRICING COMMITTEE MEMBERS:

________________________________________

Marcus Harding Chief Executive Officer and Member of the Pricing Committee

Date: May 23, 2023

________________________________________

Priya Nandakumar Chief Financial Officer and Member of the Pricing Committee

Date: May 23, 2023

ATTESTATION OF THE CORPORATE SECRETARY

I, David Shih, General Counsel and Corporate Secretary of Optiwave Semiconductor Corp., hereby certify that the foregoing resolutions were duly adopted by written consent of all members of the Pricing Committee of the Board of Directors of the Company, effective as of May 23, 2023, and that such resolutions have not been amended, modified, or rescinded and remain in full force and effect as of the date hereof. I further certify that the Pricing Committee was duly constituted and authorized by the Board Resolutions adopted on May 19, 2023, to take the actions set forth in these resolutions.

________________________________________

David Shih General Counsel and Corporate Secretary Optiwave Semiconductor Corp.

Date: May 23, 2023

EXHIBIT A

Summary Pricing Term Sheet

2.75% Convertible Senior Notes due 2028

Optiwave Semiconductor Corp.

Pricing Date: May 23, 2023

End of Exhibit A

— End of Resolutions —

Item	Amount
Gross Proceeds (assuming full exercise of Over-Allotment Option)	$287,500,000
Less: Initial Purchasers' discount	($5,750,000)
Less: Aggregate Capped Call Cost	($28,750,000)
Less: Estimated Offering Expenses (excluding discount and capped call)	($1,200,000)
Net Proceeds Available for General Corporate Purposes	$251,800,000
Term	Detail
Issuer	Optiwave Semiconductor Corp.
Security	2.75% Convertible Senior Notes due 2028
Offering Format	Rule 144A to Qualified Institutional Buyers
Reference Price	$73.38 per share (Nasdaq closing price on May 23, 2023)
Base Offering Size	$250,000,000 aggregate principal amount
Over-Allotment Option	Up to $37,500,000 additional aggregate principal amount (15%)
Maximum Offering Size	$287,500,000 aggregate principal amount
Coupon Rate	2.75% per annum, semi-annual (June 1 / December 1)
Maturity Date	June 1, 2028
Initial Conversion Rate	10.5820 shares per $1,000 principal amount
Initial Conversion Price	~$94.50 per share (28.8% premium over Reference Price)
Cap Price (Capped Call)	$110.07 per share (50.0% premium over Reference Price)
Aggregate Capped Call Cost	$28,750,000
Capped Call Counterparties	Ridgepoint Capital Markets LLC (60%); Northvane Financial Products LP (40%)
Initial Purchasers' discount	2.00% of aggregate principal amount purchased
Total discount (Full Greenshoe)	$5,750,000
Structuring Fee (Ridgepoint)	$625,000 (0.25% of base offering)
Estimated Offering Expenses	$1,200,000

Net Proceeds (Full Greenshoe)	$251,800,000
Optional Redemption	On or after June 6, 2026, at par plus accrued interest, if stock price exceeds 130% of conversion price (~$122.85) for 20 of 30 consecutive trading days
Settlement Method	Net Share Settlement (cash for principal; shares for excess)
CUSIP (144A)	683742AA5
ISIN (144A)	US683742AA53
Signing Date	May 24, 2023
Closing Date	May 30, 2023
Trustee	Broadmere Trust Company, N.A.
Lead Initial Purchaser / Structuring Agent	Ridgepoint Capital Markets LLC
Company Counsel	Calderwood & Harkness LLP

RESOLUTIONS OF THE PRICING COMMITTEE OF THE BOARD OF DIRECTORS OF OPTIWAVE SEMICONDUCTOR CORP.
Adopted by Written Consent in Lieu of Meeting
May 23, 2023
The undersigned, being all of the members of the Pricing Committee (the "Pricing Committee") of the Board of Directors (the "Board") of Optiwave Semiconductor Corp., a Delaware corporation (the "Company" or "OWS"), acting pursuant to authority delegated by the Board and in accordance with Section 141(c) of the General Corporation Law of the State of Delaware and the Company's Amended and Restated Bylaws, do hereby adopt the following resolutions by written consent in lieu of a meeting, effective as of May 23, 2023:
RECITALS
WHEREAS, the Board of Directors of the Company, by resolutions duly adopted on May 19, 2023 (the "Board Resolutions"), authorized the issuance and sale of up to $287,500,000 aggregate principal amount of the Company's 2.75% Convertible Senior Notes due 2028 (the "Notes") in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and the transactions related thereto;
WHEREAS, the Board Resolutions authorized the execution and delivery of: (i) an Indenture (the "Indenture") between the Company and Broadmere Trust Company, N.A., as trustee (the "Trustee"), governing the terms, conditions, and covenants of the Notes; (ii) a Purchase Agreement (the "Purchase Agreement") among the Company and Ridgepoint Capital Markets LLC ("Ridgepoint"), as representative of the initial purchasers named therein, including Harborstone Securities Inc. ("Harborstone") and Velthorn Zanthor & Co. ("Velthorn Zanthor" and, together with Ridgepoint and Harborstone, the "Initial Purchasers"), pursuant to which the Initial Purchasers would agree to purchase the Notes from the Company for resale to qualified institutional buyers in accordance with Rule 144A; and (iii) capped call transactions (the "Capped Call Transactions") with Ridgepoint Capital Markets LLC, acting in its principal capacity, and Northvane Financial Products LP (together, the "Capped Call Counterparties"), intended to offset potential dilution to the Company's common stock, par value $0.001 per share (the "Common Stock"), or offset any cash payments the Company may be required to make in excess of the principal amount, in each case upon any conversion of the Notes;
WHEREAS, the Board Resolutions delegated to a Pricing Committee of the Board (the "Pricing Committee"), consisting of Marcus Harding, the Company's Chief Executive Officer, and Priya Nandakumar, the Company's Chief Financial Officer, the authority to determine and approve the final pricing terms of the Notes and the Capped Call Transactions, in each case within the parameters and ranges established by the Board Resolutions, including without limitation the authority to determine the aggregate principal amount, the coupon rate, the initial conversion rate, the initial conversion price, the cap price for the Capped Call Transactions, the initial purchasers' discount, and such other pricing-related terms as the Pricing Committee may deem necessary or advisable;
WHEREAS, the Pricing Committee has reviewed the proposed final pricing terms of the Notes and the Capped Call Transactions in consultation with the Company's financial advisor and lead initial purchaser, Ridgepoint Capital Markets LLC, and the Company's outside legal counsel, Calderwood & Harkness LLP, and has considered, among other things, prevailing market conditions, recent comparable convertible debt offerings in the semiconductor and technology sectors, indicative pricing from the book-building process, and the potential impact of the offering and the Capped Call Transactions on the Company's capital structure, dilution to existing stockholders, and overall cost of capital;
WHEREAS, the Pricing Committee has determined that the final pricing terms set forth herein are within the parameters authorized by the Board Resolutions and are fair, reasonable, and in the best interests of the Company and its stockholders; and
WHEREAS, the closing sale price of the Company's Common Stock on the Nasdaq Global Select Market on May 23, 2023 (the "Pricing Date") was $73.38 per share (the "Reference Price").
NOW, THEREFORE, BE IT RESOLVED, that the Pricing Committee hereby adopts the following resolutions:
RESOLVED CLAUSES
Resolution 1: Approval of Final Pricing Terms of the Notes
RESOLVED, that the Pricing Committee hereby approves and determines the following final pricing terms of the Notes, which terms shall be reflected in the Indenture, the Purchase Agreement, and such other transaction documents as are necessary or appropriate to give effect thereto:
(a) Aggregate Principal Amount (Base Offering). The aggregate principal amount of Notes to be issued and sold in the base offering shall be $250,000,000.
(b) Over-Allotment Option. The Initial Purchasers shall be granted an option, exercisable in whole or in part at any time within 13 calendar days after the closing date of the offering, to purchase up to an additional $37,500,000 aggregate principal amount of Notes (representing 15% of the base offering amount), for a maximum total aggregate principal amount of $287,500,000 if such option is exercised in full (the "Over-Allotment Option").
(c) Coupon Rate. The Notes shall bear interest at a rate of 2.75% per annum, payable semi-annually in arrears on June 1 and December 1 of each year, commencing on December 1, 2023. Interest shall be computed on the basis of a 360-day year consisting of twelve 30-day months.
(d) Maturity Date. The Notes shall mature on June 1, 2028, unless earlier repurchased, redeemed, or converted in accordance with the terms of the Indenture.
(e) Initial Conversion Rate. The initial conversion rate for the Notes shall be 10.5820 shares of Common Stock per $1,000 principal amount of Notes, subject to adjustment as provided in the Indenture.
(f) Initial Conversion Price. The initial conversion price for the Notes shall be approximately $94.50 per share (calculated as $1,000 divided by the initial conversion rate of 10.5820), representing an approximate 28.8% premium over the Reference Price of $73.38 per share.
(g) Net Share Settlement. The Company shall have the right to elect to settle conversions of the Notes through a combination of cash and shares of Common Stock, with cash to be paid in respect of the principal amount of the Notes being converted and shares of Common Stock (or, at the Company's election, cash or a combination of cash and shares) to be delivered in respect of any conversion value in excess of the principal amount, in each case as more fully described in the Indenture (the "Net Share Settlement" method). The Company's initial election shall be to settle conversions using the Net Share Settlement method, and any change to such election shall require further authorization by the Board or a duly authorized committee thereof.
(h) CUSIP (144A). The CUSIP number assigned to the Notes offered and sold pursuant to Rule 144A shall be 683742AA5.
(i) ISIN (144A). The ISIN assigned to the Notes offered and sold pursuant to Rule 144A shall be US683742AA53.
(j) Fundamental Change and Make-Whole Provisions. The Notes shall include a fundamental change repurchase right and a make-whole fundamental change adjustment to the conversion rate, in each case as set forth in the form of Indenture previously reviewed and approved by the Board in connection with the Board Resolutions.
(k) Ranking. The Notes shall be senior, unsecured obligations of the Company, ranking senior in right of payment to all of the Company's indebtedness that is expressly subordinated in right of payment to the Notes; equal in right of payment with all of the Company's existing and future unsecured indebtedness that is not so subordinated; effectively subordinated to all of the Company's existing and future secured indebtedness, to the extent of the value of the assets securing such indebtedness; and structurally subordinated to all existing and future indebtedness and other liabilities of the Company's subsidiaries.
FURTHER RESOLVED, that the foregoing pricing terms are within the parameters established by the Board Resolutions and are hereby confirmed and ratified.
Resolution 2: Approval of Optional Redemption Terms
RESOLVED, that the Pricing Committee hereby confirms and approves the optional redemption terms applicable to the Notes as set forth in the Indenture, which shall provide as follows:
(a) The Notes shall not be redeemable by the Company at the Company's option prior to June 6, 2026.
(b) On or after June 6, 2026, the Company may redeem for cash all or any portion (subject to certain minimum denomination requirements) of the Notes at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date; provided, that the Company may not exercise such optional redemption right unless the last reported sale price of the Company's Common Stock on the Nasdaq Global Select Market (or such other national securities exchange on which the Common Stock is then listed) has exceeded 130% of the conversion price then in effect (which, based on the initial conversion price of approximately $94.50, would be approximately $122.85 per share) for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading-day period ending on, and including, the trading day immediately preceding the date on which the Company provides the notice of redemption.
(c) Upon any such optional redemption, holders of Notes called for redemption shall have the right to convert their Notes at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date, in accordance with the terms of the Indenture.
Resolution 3: Approval of Initial Purchasers' discount and Structuring Fee
RESOLVED, that the Pricing Committee hereby approves the following compensation arrangements with the Initial Purchasers in connection with the offering:
(a) Initial Purchasers' discount. The Initial Purchasers shall receive a discount equal to 2.00% of the aggregate principal amount of Notes purchased by the Initial Purchasers, calculated as follows:
(i) With respect to the base offering: $250,000,000 × 2.00% = $5,000,000;
(ii) With respect to the Over-Allotment Option (if exercised in full): $37,500,000 × 2.00% = $750,000; and
(iii) Total Initial Purchasers' discount (assuming the Over-Allotment Option is exercised in full): $5,750,000.
(b) Allocation of discount Among Initial Purchasers. The Initial Purchasers' discount shall be allocated among the Initial Purchasers as follows (in each case calculated assuming full exercise of the Over-Allotment Option):
(i) Ridgepoint Capital Markets LLC: 60% ($3,450,000);
(ii) Harborstone Securities Inc.: 25% ($1,437,500); and
(iii) Velthorn Zanthor & Co.: 15% ($862,500).
In the event the Over-Allotment Option is exercised only in part or is not exercised at all, the foregoing allocation percentages shall remain the same, applied to the total discount amount actually payable based on the aggregate principal amount of Notes actually purchased.
(c) Structuring Fee. In addition to the Initial Purchasers' discount described above, the Company shall pay to Ridgepoint Capital Markets LLC a structuring fee equal to 0.25% of the base offering principal amount of $250,000,000, or $625,000. The structuring fee shall be payable on the closing date of the offering and shall be separate from, and in addition to, the Initial Purchasers' discount. The structuring fee is being paid in recognition of Ridgepoint Capital Markets LLC's role as sole structuring agent for the offering and the Capped Call Transactions.
FURTHER RESOLVED, that the aggregate compensation payable to the Initial Purchasers (including the structuring fee) is fair and reasonable in light of the nature and size of the offering, prevailing market conditions, and the services to be rendered by the Initial Purchasers.
Resolution 4: Approval of Capped Call Transaction Terms
RESOLVED, that the Pricing Committee hereby approves the final terms of the Capped Call Transactions to be entered into with the Capped Call Counterparties, as follows:
(a) Purpose. The Capped Call Transactions are intended to offset potential dilution to the Common Stock (or offset any cash payments in excess of the principal amount of the Notes that the Company may be required to make) upon any conversion of the Notes, with such offset effective up to the cap price described below, thereby increasing the effective conversion price from the perspective of the Company's existing stockholders.
(b) Counterparties and Allocation. The Capped Call Transactions shall be entered into with the following counterparties, with the aggregate notional amount allocated as follows:
(i) Ridgepoint Capital Markets LLC (acting in its principal capacity, and not as agent for the Company or any other party): 60% of the aggregate notional amount; and
(ii) Northvane Financial Products LP: 40% of the aggregate notional amount.
(c) Lower Strike Price. The lower strike price of the Capped Call Transactions shall be equal to the initial conversion price of the Notes, which is approximately $94.50 per share, subject to anti-dilution adjustments substantially similar to those applicable to the Notes under the Indenture.
(d) Cap Price (Upper Strike). The cap price of the Capped Call Transactions shall be $110.07 per share, representing a 50.0% premium over the Reference Price of $73.38 per share. The cap price shall be subject to certain adjustments as set forth in the applicable capped call confirmations.
(e) Effective Conversion Price with Capped Call. Taking into account the Capped Call Transactions, the effective conversion price of the Notes from the Company's perspective shall be approximately $110.07 per share. Accordingly, no dilution to the Common Stock (or excess cash payments) will occur upon conversion of the Notes unless the market price of the Common Stock exceeds the cap price at the time of conversion.
(f) Aggregate Cost of Capped Call Transactions. The aggregate premium to be paid by the Company for the Capped Call Transactions shall be $28,750,000, allocated between the Capped Call Counterparties as follows:
(i) Ridgepoint Capital Markets LLC: $17,250,000 (representing 60% of $28,750,000); and
(ii) Northvane Financial Products LP: $11,500,000 (representing 40% of $28,750,000).
The aggregate premium shall be payable on the closing date of the offering of the Notes out of the proceeds thereof. In the event the Over-Allotment Option is exercised, additional capped call transactions may be entered into with the Capped Call Counterparties at the same per-share cost, with such additional premium payable on the settlement date for such Over-Allotment Option exercise.
(g) Expiration. The Capped Call Transactions shall expire on June 1, 2028, matching the maturity date of the Notes, subject to earlier exercise upon conversion of the Notes, early termination upon the occurrence of certain extraordinary events, or other termination events as set forth in the applicable confirmations.
(h) Documentation. The Capped Call Transactions shall be documented under 2002 ISDA Master Agreements (together with the related Schedules) and Confirmations between the Company and each Capped Call Counterparty. Each such 2002 ISDA Master Agreement, Schedule, and Confirmation shall be governed by and construed in accordance with the laws of the State of New York, without regard to conflicts of laws principles thereof (other than Section 5-1401 of the New York General Obligations Law).
(i) Collateral and Credit Support. The Capped Call Transactions shall be unsecured obligations of the respective Capped Call Counterparties, and the Company shall not be required to post collateral or provide any credit support in connection therewith.
FURTHER RESOLVED, that the terms of the Capped Call Transactions, including the aggregate premium, are fair and reasonable in light of current market conditions, comparable capped call transactions in recent convertible debt offerings, and the anticipated benefits to the Company and its stockholders in the form of reduced dilution.
Resolution 5: Approval of Use of Proceeds
RESOLVED, that the Pricing Committee hereby confirms that the net proceeds of the offering of the Notes shall be applied as set forth below, consistent with the disclosures to be included in the Offering Memorandum:
(a) The estimated sources and uses of proceeds from the offering (assuming full exercise of the Over-Allotment Option) are as follows:
(b) The estimated offering expenses of approximately $1,200,000 include, without limitation, legal fees and expenses of the Company's outside counsel, fees and expenses of the Trustee and its counsel, accounting fees, printing and EDGAR filing expenses, rating agency fees (if applicable), and other miscellaneous expenses.
(c) The net proceeds shall be used for the following purposes:
(i) Revolving Credit Facility Repayment. Approximately $75,000,000 shall be applied to the repayment of outstanding borrowings under the Company's $300,000,000 senior secured revolving credit facility (the "Revolving Credit Facility"), for which Crestline National Bank, N.A. serves as administrative agent. As of the Pricing Date, $75,000,000 was outstanding under the Revolving Credit Facility. Following such repayment, the Company will have $300,000,000 of availability under the Revolving Credit Facility (subject to the terms and conditions thereof). Borrowings under the Revolving Credit Facility bear interest at a rate of, at the Company's election, the Secured Overnight Financing Rate ("SOFR") plus a margin of 1.50% per annum or an alternate base rate plus a margin of 0.50% per annum.
(ii) General Corporate Purposes. The remainder of the net proceeds, estimated to be approximately $176,800,000, shall be used for general corporate purposes, including, without limitation, working capital, research and development expenditures, potential acquisitions of complementary businesses, technologies, or assets, and capital expenditures related to the Company's semiconductor fabrication and design facilities.
FURTHER RESOLVED, that the Company's officers are authorized to modify the allocation of net proceeds among the foregoing uses in their reasonable business judgment, subject to applicable disclosure obligations, and provided that any such modification is consistent with the Company's publicly disclosed intended use of proceeds.
Resolution 6: Authorization to Execute Final Transaction Documents
RESOLVED, that the Pricing Committee hereby authorizes and directs each of the following officers of the Company (each, an "Authorized Officer"), acting individually or together, to execute, deliver, and perform on behalf of the Company all documents, instruments, agreements, and certificates as may be necessary or advisable to consummate the offering and the transactions contemplated by these resolutions and the Board Resolutions:
•  Marcus Harding, Chief Executive Officer
•  Priya Nandakumar, Chief Financial Officer
•  David Shih, General Counsel and Corporate Secretary
•  Rachel Fontaine, Treasurer
FURTHER RESOLVED, that without limiting the generality of the foregoing, each Authorized Officer is hereby authorized and directed to:
(a) Execute and deliver the Purchase Agreement with the Initial Purchasers, reflecting the pricing terms approved herein, with a signing date of May 24, 2023 and a closing date of May 30, 2023 (the "Closing Date"), in substantially the form previously reviewed by the Board and approved in connection with the Board Resolutions, with such changes, modifications, and amendments as the Authorized Officer executing the same shall approve, such approval to be conclusively evidenced by such officer's execution thereof;
(b) Execute and deliver the Indenture with Broadmere Trust Company, N.A., as Trustee, on the Closing Date, in substantially the form previously reviewed by the Board and approved in connection with the Board Resolutions, with such changes, modifications, and amendments as the Authorized Officer executing the same shall approve, such approval to be conclusively evidenced by such officer's execution thereof;
(c) Execute and deliver the Notes in global form to be authenticated by the Trustee and deposited with The Depository Trust Company or its nominee on the Closing Date;
(d) Execute and deliver the 2002 ISDA Master Agreements, Schedules, and Capped Call Confirmations with each of Ridgepoint Capital Markets LLC and Northvane Financial Products LP, reflecting the capped call transaction terms approved herein, with such changes, modifications, and amendments as the Authorized Officer executing the same shall approve, such approval to be conclusively evidenced by such officer's execution thereof;
(e) Execute and deliver all officers' certificates, secretary's certificates, instruction letters, opinion back-up certificates, representation letters, comfort letter bring-down requests, closing certificates, and other closing documents and deliverables as may be necessary, advisable, or customary in connection with the offering and the related transactions;
(f) File or cause to be filed a supplemental listing application with the Nasdaq Stock Market LLC for up to approximately 3,042,325 shares of Common Stock issuable upon conversion of the Notes (including shares issuable upon conversion of Notes issued upon exercise of the Over-Allotment Option in full), calculated based on the initial conversion rate of 10.5820 shares per $1,000 principal amount applied to the maximum aggregate principal amount of $287,500,000;
(g) Make or cause to be made any filings with the U.S. Securities and Exchange Commission on Form 8-K or otherwise as may be required or advisable in connection with the offering and the transactions contemplated hereby;
(h) Reserve or cause to be reserved for issuance from the Company's authorized but unissued shares of Common Stock a sufficient number of shares to satisfy the Company's conversion obligations under the Notes; and
(i) Take all such further actions and execute all such further instruments, agreements, certificates, and documents as any such Authorized Officer may determine, in his or her sole discretion, to be necessary, advisable, or appropriate to consummate and give full force and effect to the transactions contemplated by these resolutions, the Board Resolutions, and the transaction documents described herein.
FURTHER RESOLVED, that the execution by any Authorized Officer of any document, instrument, agreement, or certificate contemplated by these resolutions shall be conclusive evidence that such Authorized Officer has determined, on behalf of the Company, that such document, instrument, agreement, or certificate is necessary or advisable in connection with the transactions contemplated hereby, and the approval of the form and substance thereof shall be conclusively established by such execution.
Resolution 7: Ratification
RESOLVED, that any and all actions heretofore taken by any officer, director, employee, or authorized representative of the Company in connection with the matters contemplated by these resolutions and the Board Resolutions, including, without limitation, the preparation and distribution of the Preliminary Offering Memorandum, the engagement of the Initial Purchasers, the engagement of the Capped Call Counterparties, the engagement of outside counsel and other advisors, the negotiation of the transaction documents, and the conduct of the book-building process and investor communications, are hereby ratified, confirmed, approved, and adopted in all respects as the acts and deeds of the Company.
Resolution 8: Effective Date
RESOLVED, that these resolutions shall be effective as of May 23, 2023, the Pricing Date, and shall remain in full force and effect until the transactions contemplated hereby are consummated or until these resolutions are amended, modified, or rescinded by subsequent action of the Board or the Pricing Committee.
FURTHER RESOLVED, that these resolutions may be executed in one or more counterparts, including by facsimile or electronic transmission (including .pdf format), each of which shall be deemed an original and all of which together shall constitute one and the same instrument.
[Signature Page Follows]
SIGNATURE PAGE TO RESOLUTIONS OF THE PRICING COMMITTEE OF THE BOARD OF DIRECTORS OF OPTIWAVE SEMICONDUCTOR CORP.
IN WITNESS WHEREOF, the undersigned members of the Pricing Committee of the Board of Directors of Optiwave Semiconductor Corp. have executed these resolutions by written consent as of the date first set forth above, effective as of May 23, 2023.
PRICING COMMITTEE MEMBERS:
________________________________________
Marcus Harding Chief Executive Officer and Member of the Pricing Committee
Date: May 23, 2023
________________________________________
Priya Nandakumar Chief Financial Officer and Member of the Pricing Committee
Date: May 23, 2023
ATTESTATION OF THE CORPORATE SECRETARY
I, David Shih, General Counsel and Corporate Secretary of Optiwave Semiconductor Corp., hereby certify that the foregoing resolutions were duly adopted by written consent of all members of the Pricing Committee of the Board of Directors of the Company, effective as of May 23, 2023, and that such resolutions have not been amended, modified, or rescinded and remain in full force and effect as of the date hereof. I further certify that the Pricing Committee was duly constituted and authorized by the Board Resolutions adopted on May 19, 2023, to take the actions set forth in these resolutions.
________________________________________
David Shih General Counsel and Corporate Secretary Optiwave Semiconductor Corp.
Date: May 23, 2023
EXHIBIT A
Summary Pricing Term Sheet
2.75% Convertible Senior Notes due 2028
Optiwave Semiconductor Corp.
Pricing Date: May 23, 2023
End of Exhibit A
— End of Resolutions —
Item | Amount
Gross Proceeds (assuming full exercise of Over-Allotment Option) | $287,500,000
Less: Initial Purchasers' discount | ($5,750,000)
Less: Aggregate Capped Call Cost | ($28,750,000)
Less: Estimated Offering Expenses (excluding discount and capped call) | ($1,200,000)
Net Proceeds Available for General Corporate Purposes | $251,800,000
Term | Detail
Issuer | Optiwave Semiconductor Corp.
Security | 2.75% Convertible Senior Notes due 2028
Offering Format | Rule 144A to Qualified Institutional Buyers
Reference Price | $73.38 per share (Nasdaq closing price on May 23, 2023)
Base Offering Size | $250,000,000 aggregate principal amount
Over-Allotment Option | Up to $37,500,000 additional aggregate principal amount (15%)
Maximum Offering Size | $287,500,000 aggregate principal amount
Coupon Rate | 2.75% per annum, semi-annual (June 1 / December 1)
Maturity Date | June 1, 2028
Initial Conversion Rate | 10.5820 shares per $1,000 principal amount
Initial Conversion Price | ~$94.50 per share (28.8% premium over Reference Price)
Cap Price (Capped Call) | $110.07 per share (50.0% premium over Reference Price)
Aggregate Capped Call Cost | $28,750,000
Capped Call Counterparties | Ridgepoint Capital Markets LLC (60%); Northvane Financial Products LP (40%)
Initial Purchasers' discount | 2.00% of aggregate principal amount purchased
Total discount (Full Greenshoe) | $5,750,000
Structuring Fee (Ridgepoint) | $625,000 (0.25% of base offering)
Estimated Offering Expenses | $1,200,000
Net Proceeds (Full Greenshoe) | $251,800,000
Optional Redemption | On or after June 6, 2026, at par plus accrued interest, if stock price exceeds 130% of conversion price (~$122.85) for 20 of 30 consecutive trading days
Settlement Method | Net Share Settlement (cash for principal; shares for excess)
CUSIP (144A) | 683742AA5
ISIN (144A) | US683742AA53
Signing Date | May 24, 2023
Closing Date | May 30, 2023
Trustee | Broadmere Trust Company, N.A.
Lead Initial Purchaser / Structuring Agent | Ridgepoint Capital Markets LLC
Company Counsel | Calderwood & Harkness LLP

RESOLUTIONS OF THE PRICING COMMITTEE OF THE BOARD OF DIRECTORS OF OPTIWAVE SEMICONDUCTOR CORP.

RECITALS

RESOLVED CLAUSES

PRICING COMMITTEE MEMBERS:

ATTESTATION OF THE CORPORATE SECRETARY

EXHIBIT A

Record

Parties

Dates

Amounts