Acacia Communications (ACIA) PREM14APreliminary proxy related to merger

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

Filed by the Registrant  ☒                            Filed by a Party other than the Registrant  ☐

Check the appropriate box:

ACACIA COMMUNICATIONS, INC.

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

PRELIMINARY PROXY STATEMENT—SUBJECT TO COMPLETION

[—], 2021

Dear Acacia stockholder:

We are pleased to invite you to attend a special meeting of the stockholders of Acacia Communications, Inc., a Delaware corporation, which we refer to as “we,” “us,” “Acacia” or the “Company,” to be held virtually on [—], 2021 at [—] Eastern time. Due to public health and travel concerns related to coronavirus (COVID-19), the special meeting will be a virtual stockholder meeting, conducted via webcast. You may attend the special meeting online, vote your shares electronically and submit questions during the special meeting by visiting www.proxydocs.com/ACIA. You will need to have your control number, included on your proxy card or voting instruction form, to join and participate in the special meeting, and you will need to register for the special meeting in advance in order to virtually attend the special meeting by visiting www.proxydocs.com/ACIA. Instructions on how to attend and participate online will be provided to you via email after you register. The deadline for registering to virtually attend the special meeting is [—], Eastern time on [—], 2021. Approximately one hour prior to the start of the special meeting, you will receive further instructions via email, including your unique links that will allow you access to the meeting and will also permit you to submit questions. We encourage you to access the meeting 15 minutes prior to the start time to allow ample time to check your connection and visual and audio settings. If you encounter any difficulties accessing the virtual meeting prior to or during the meeting time, please call the technical support number provided to you in such emailed instructions for the special meeting.

On July 9, 2019, the Company announced that it had entered into an Agreement and Plan of Merger, dated as of July 8, 2019, which we refer to as the original merger agreement, with Cisco Systems, Inc., a California corporation (subsequently reincorporated as a Delaware corporation), which we refer to as Parent, and Amarone Acquisition Corp., a Delaware corporation and a wholly owned subsidiary of Parent, which we refer to as Merger Sub. On January 14, 2021, the Company announced that it had entered into an Amended and Restated Agreement and Plan of Merger, dated as of January 14, 2021, which we refer to as the amended and restated merger agreement, with Parent and Merger Sub, which amended and restated the original merger agreement in its entirety and provides for the merger of Merger Sub with and into the Company, which we refer to as the merger, with the Company surviving the merger as a wholly owned subsidiary of Parent.

At the special meeting, you will be asked to consider and vote on the following matters:

Stockholders will also act on any other business that may properly come before the special meeting.

If the merger is consummated, each share of Company common stock issued and outstanding immediately prior to the effective time of the merger will, other than as provided below, be converted into the right to receive $115.00 in cash, without interest and subject to deduction for any required withholding tax. We refer to this consideration per share of Company common stock to be paid in the merger as the merger consideration. The following shares of Company common stock will not be converted into the right to receive the merger consideration in connection with the merger: (a) shares held by any of our stockholders who do not vote in favor of the proposal to adopt the amended and restated merger agreement and who otherwise properly exercise, and do not withdraw or lose, appraisal rights in accordance with Section 262 of the General Corporation Law of the State of Delaware, which we refer to as the DGCL, (b) shares held in the treasury of the Company and (c) shares owned by Parent or any direct or indirect wholly owned subsidiary of the Company or subsidiary of Parent.

The board of directors of the Company, which we refer to as the board of directors, has unanimously determined that the terms and conditions of the merger and the amended and restated merger agreement are advisable, fair to and in the best interests of the Company and its stockholders and recommends that all Company stockholders vote in favor of the proposal to adopt the amended and restated merger agreement. The board of directors made its determination after consultation with its legal and financial advisors and consideration of a number of factors. The board of directors recommends that you vote “FOR” approval of the proposal to adopt the amended and restated merger agreement, “FOR” approval of the nonbinding advisory proposal regarding compensation that may be payable to our named executive officers in connection with the merger and “FOR” approval of the proposal to adjourn the special meeting, if necessary or appropriate, to solicit additional proxies.

Approval of the proposal to adopt the amended and restated merger agreement requires the affirmative vote of the holders of a majority of the shares of Company common stock that are issued and outstanding as of the record date.

In accordance with the DGCL, the amendment and restatement of the original merger agreement necessitates that the amended and restated merger agreement be adopted by the affirmative vote of holders of a majority of the shares of Company common stock that are issued and outstanding as of the record date. As a result, you are now being asked to vote on the proposal to adopt the amended and restated merger agreement, which amended and restated the original merger agreement in its entirety, despite the fact that you may have voted on the proposal to adopt the original merger agreement in connection with the September 6, 2019 special meeting of the Company’s stockholders.

Your vote is very important. Whether or not you plan to attend the special meeting online, please complete, date, sign and return, as promptly as possible, the enclosed proxy card in the accompanying prepaid reply envelope, or submit your proxy by telephone or the Internet. If you properly sign your proxy card but do not mark the boxes showing how your shares should be voted on a matter, the shares represented by your properly signed proxy will be voted “FOR” approval of the proposal to adopt the amended and restated merger agreement, “FOR” approval of the nonbinding advisory proposal regarding compensation that may be payable to our named executive officers in connection with the merger and “FOR” approval of the proposal to adjourn the special meeting, if necessary or appropriate, to solicit additional proxies. You may revoke your proxy at any time before it is exercised at the special meeting by delivering a properly executed proxy card bearing a later date or a written revocation of your proxy to the Company’s Secretary before the start of the special meeting, submitting a later-dated proxy electronically via the Internet or telephonically, or by voting online while virtually attending the special meeting. Virtually attending the special meeting will not, in itself, revoke a previously submitted proxy. To revoke a proxy at the special meeting, you must vote online while virtually attending the special meeting. The failure to vote your shares of Company common stock will have the same effect as a vote “AGAINST” approval of the proposal to adopt the amended and restated merger agreement.

If your shares of Company common stock are held in “street name” by your bank, brokerage firm or other nominee, your bank, brokerage firm or other nominee will be unable to vote your shares of Company common stock without instructions from you. You should instruct your bank, brokerage firm or other nominee to vote

your shares of Company common stock in accordance with the procedures provided by your bank, brokerage firm or other nominee. The failure to instruct your bank, brokerage firm or other nominee to vote your shares of Company common stock “FOR” approval of the proposal to adopt the amended and restated merger agreement will have the same effect as voting “AGAINST” the proposal to adopt the amended and restated merger agreement.

Under the DGCL, if the merger is completed, holders of Company common stock who do not vote in favor of adoption of the amended and restated merger agreement and satisfy other conditions set forth in Section 262 of the DGCL will have the right to seek an appraisal by the Delaware Court of Chancery of the fair value of their shares. In order to exercise your appraisal rights, you must submit a written demand for an appraisal of your shares prior to the stockholder vote to adopt the amended and restated merger agreement, you must not vote in favor of adoption of the amended and restated merger agreement and you must comply with the procedures set forth in Section 262 of the DGCL and explained in the accompanying proxy statement. See “Appraisal Rights” beginning on page [—] of the accompanying proxy statement and Annex D to the accompanying proxy statement.

The accompanying proxy statement provides you with detailed information about the special meeting, the amended and restated merger agreement and the merger. A copy of the amended and restated merger agreement is attached as Annex A to the accompanying proxy statement. We encourage you to carefully read the entire proxy statement and its annexes, including the amended and restated merger agreement. You also may obtain additional information about the Company from documents we have filed with the Securities and Exchange Commission by following the instructions listed in the section of the accompanying proxy statement entitled “Where You Can Find More Information.”

If you have any questions or need assistance in submitting your proxy or voting your shares of Company common stock, please call The Proxy Advisory Group, LLC, the Company’s proxy solicitor, at (212) 616-2181.

Thank you in advance for your cooperation and continued support.

Sincerely,

Murugesan Shanmugaraj

President and Chief Executive Officer

The accompanying proxy statement is dated [—], 2021 and is first being mailed to our stockholders on or about [—], 2021.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THE MERGER, PASSED UPON THE MERITS OR FAIRNESS OF THE AMENDED AND RESTATED MERGER AGREEMENT OR THE TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING THE PROPOSED MERGER, OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE INFORMATION CONTAINED IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

PRELIMINARY PROXY STATEMENT—SUBJECT TO COMPLETION

ACACIA COMMUNICATIONS, INC.

Three Mill and Main Place, Suite 400

Maynard, Massachusetts 01754

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS

WHETHER OR NOT YOU PLAN TO VIRTUALLY ATTEND THE SPECIAL MEETING, PLEASE COMPLETE, DATE, SIGN AND RETURN, AS PROMPTLY AS POSSIBLE, THE ENCLOSED PROXY CARD IN THE ACCOMPANYING PREPAID REPLY ENVELOPE, OR SUBMIT YOUR PROXY BY TELEPHONE OR THE INTERNET. IF YOU VOTE ONLINE WHILE VIRTUALLY ATTENDING THE SPECIAL MEETING, THAT VOTE WILL REVOKE ANY PROXY PREVIOUSLY SUBMITTED.

By Order of our Board of Directors,

Janene I. Asgeirsson

Chief Legal Officer and Secretary

[—], 2021

Maynard, Massachusetts

PROXY STATEMENT

TABLE OF CONTENTS

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QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGER

The following questions and answers are intended to address briefly some commonly asked questions regarding the merger, the amended and restated merger agreement and the special meeting. These questions and answers may not address all questions that may be important to you as a Company stockholder. Please refer to the “Summary” and the more detailed information contained elsewhere in this proxy statement, the annexes to this proxy statement and the documents referred to in this proxy statement, which you should read carefully and in their entirety. You may obtain the information incorporated by reference in this proxy statement without charge by following the instructions under “Where You Can Find More Information” beginning on page [—].

In accordance with the DGCL, the amendment and restatement of the original merger agreement necessitates that the amended and restated merger agreement be adopted by the affirmative vote of the

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holders of a majority of the shares of our common stock issued and outstanding as of the close of business on the record date. As a result, you are now being asked to vote on the proposal to adopt the amended and restated merger agreement, which amended and restated the original merger agreement in its entirety, despite the fact that you may have voted on the proposal to adopt the original merger agreement in connection with the September 6, 2019 special meeting of the Company’s stockholders.

Each Company stock option that is outstanding and unvested immediately prior to the effective time of the merger will be canceled at the effective time and converted into the right to receive an amount in cash, without interest, equal to the excess, if any, of the merger consideration over the exercise price per share of such stock option payable to the extent, and at the applicable times, such unvested option would have become vested under the vesting schedule in place for such stock option immediately prior to the effective time, including under the terms of the CIC plan, and any scheduled retention agreement after giving effect to any applicable employment offer documents received from Parent; provided that, in the event that the exercise price of any such unvested stock option is equal to or greater than the merger consideration, such stock option will be canceled at the effective time, without any consideration being payable in respect thereof and have no further force or effect.

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Each RSU and PRSU that is outstanding and vested and has not been settled immediately prior to the effective time of the merger (which includes PRSUs with a TSR performance metric that will become vested based on actual results as of the closing of the merger and certain RSUs that will become vested as of the closing of the merger) will be canceled at the effective time and converted into the right to receive an amount in cash, without interest, equal to the merger consideration.

Each RSU and PRSU that is outstanding and unvested immediately prior to the effective time of the merger will be canceled at the effective time and converted into the right to receive an amount in cash, without interest, equal to the merger consideration payable to the extent, and at the applicable times, such unvested RSU or PRSU would have become vested under the vesting schedule in place for such RSU or PRSU immediately prior to the effective time, including under the terms of the CIC plan and any scheduled retention agreement after giving effect to any applicable employment offer documents entered into with Parent.

Each cash payment for the options, RSUs and PRSUs described above will be subject to deduction for any applicable withholding taxes.

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In accordance with the DGCL, the amendment and restatement of the original merger agreement necessitates that the amended and restated merger agreement be adopted by the affirmative vote of the holders of a majority of the shares of our common stock issued and outstanding as of the close of business on the record date. As a result, you are now being asked to vote on the proposal to adopt the amended and restated merger agreement, which amended and restated the original merger agreement in its entirety, despite the fact that you may have voted on the proposal to adopt the original merger agreement in connection with the September 6, 2019 special meeting of the Company’s stockholders.

In accordance with the DGCL, the amendment and restatement of the original merger agreement necessitates that the amended and restated merger agreement be adopted by the affirmative vote of holders of a majority of the shares of Company common stock that are issued and outstanding as of the record date. As a result, you are now being asked to vote on the proposal to adopt the amended and restated merger agreement, despite the fact that you may have voted on the proposal to adopt the original merger agreement in connection with the September 6, 2019 special meeting of the Company’s stockholders.

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Pursuant to voting agreements entered into on January 14, 2021 between Parent and each of Murugesan Shanmugaraj, Benny Mikkelsen, Christian Rasmussen and Mehrdad Givehchi (including certain entities holding shares of Company common stock on their behalf), such stockholders agreed, among other things, to vote their shares of Company common stock in favor of the adoption of the amended and restated merger agreement and any matter that would reasonably be expected to facilitate the merger. As of the record date, these stockholders beneficially owned and were entitled to vote approximately [—]% of the issued and outstanding shares of Company common stock.

Because the affirmative vote required to approve the proposal to adopt the amended and restated merger agreement is based upon the total number of outstanding shares of Company common stock, if you fail to submit a proxy or to vote online while virtually attending the special meeting, or if you vote “ABSTAIN”, or if you do not provide your bank, brokerage firm or other nominee with voting instructions, it will have the same effect as a vote “AGAINST” the proposal to adopt the amended and restated merger agreement.

If you vote “ABSTAIN” on the proposal regarding compensation that may be payable to our named executive officers in connection with the merger or the proposal to adjourn the special meeting, if necessary or appropriate, to solicit additional proxies, this will have no effect on these proposals. If you fail to submit a proxy or to vote online while virtually attending the special meeting, or if you do not provide your bank, brokerage firm or other nominee with voting instructions, your shares of Company common stock will not be voted on these proposals, and thus will have no effect on these proposals.

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If you hold your shares of Company common stock in “street name,” please refer to the instructions provided by your bank, brokerage firm or other nominee to see the methods available to you. Please note that if you are a beneficial owner of shares of Company common stock held in “street name” and wish to vote online while virtually attending the special meeting, you must request and obtain a legal proxy from your bank, brokerage firm or other nominee prior to the special meeting.

A control number, located on your proxy card, is designed to verify your identity and allow you to submit a proxy for your shares of Company common stock, and to confirm that your voting instructions have been properly recorded when submitting a proxy over the Internet or by telephone.

If your shares of Company common stock are held through a bank, brokerage firm or other nominee, you are considered the beneficial owner of shares of Company common stock held in “street name.” In that case, this proxy statement has been forwarded to you by your bank, brokerage firm or other nominee who is considered, with respect to those shares of Company common stock, the stockholder of record. As the beneficial owner of shares of Company common stock held in “street name,” you have the right to direct your bank, brokerage firm or other nominee how to vote your shares of Company common stock by following their instructions for voting.

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If you properly sign your proxy card but do not mark the boxes showing how your shares of Company common stock should be voted on a matter, the shares represented by your properly signed proxy will be voted “FOR” the proposal to adopt the amended and restated merger agreement, “FOR” approval of the nonbinding advisory proposal regarding compensation that may be payable to our named executive officers in connection with the merger and “FOR” the proposal to adjourn the special meeting, if necessary or appropriate, to solicit additional proxies.

With respect to the proposal regarding compensation that may be payable to our named executive officers in connection with the merger and the proposal to adjourn the special meeting, if necessary or appropriate, to solicit additional proxies, you may vote “FOR”, “AGAINST” or “ABSTAIN.” Abstentions and broker non-votes will have no effect on these proposals.

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CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING INFORMATION

This proxy statement, and the documents to which we refer you in this proxy statement, as well as information included in oral statements or other written statements made or to be made by us, contain a number of “forward-looking statements,” including all statements relating directly or indirectly to the timing or likelihood of completing the merger to which this proxy statement relates, financial forecasts and other information with respect to our plans and strategies. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, the words “may,” “should,” “would,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “forecasts,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” “will” or “continue” or the negative of these terms or other similar expressions are intended to help you identify forward-looking statements. Forward-looking statements may include statements regarding the expected benefits to Parent, the Company and their respective customers from completing the merger; integration of the Company’s technology into Parent’s networking portfolio, accelerating the trend toward coherent technology and pluggable solutions, supporting Merger Sub’s current merchant business, including the Company’s existing customers and new customers; and the expected completion of the merger. Forward-looking statements are only predictions. The events and circumstances reflected in forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. The Company has based these forward-looking statements largely on its current expectations and projections about future events and trends that the Company believes may affect its business, financial condition and results of operations. These forward-looking statements speak only as of the date they were made and are subject to a number of risks, uncertainties and assumptions including, without limitation: the risk that the merger may not be completed in a timely manner, or at all, which may adversely affect the Company’s business and the price of its common stock; obtaining the approval of the Company’s stockholders of the merger or that other conditions to the closing of the merger may not be satisfied; the potential impacts on the Company’s business, reputation, relationships, results of operations, cash flows and financial condition as a result of the merger, uncertainty with respect to the merger or litigation relating to the merger; litigation against the Company or its directors or officers related to the merger and any adverse outcome of such litigation; the effects of announcements relating to the merger; the costs, fees, expenses and other charges related to the merger, including with respect to related litigation; risks that the merger may disrupt the Company’s plans and business operations; risks that the merger and litigation relating to the merger may divert management’s attention from the Company’s ongoing business operations, disrupt the Company’s operations and result in potential difficulties in the Company’s ability to attract and retain employees; the occurrence of any event, change or other circumstances that could give rise to the termination of the amended and restated merger agreement; general economic conditions; the ability of Parent to successfully integrate the Company’s market opportunities, technology, personnel and operations and to achieve expected benefits; the Company’s ability to maintain its listing on the Nasdaq Global Select Market; uncertainty regarding the extent to which the coronavirus disease, COVID-19, pandemic and related response measures will adversely affect the Company’s business, results of operations, cash flows and financial condition, or the business and financial condition of the Company’s customers and suppliers; the Company’s ability to sustain or increase revenue from its larger customers, generate revenues from new customers, or offset the discontinuation of concentrated purchases by its larger customers with purchases by new or existing customers; the Company’s ability to anticipate the timing and scale of demand for its products, including from its largest customers; the adverse impact of negative economic conditions created or exacerbated by the ongoing COVID-19 pandemic; the Company’s expectations regarding expenses and revenue, its ability to maintain and expand gross profit, the sufficiency of the Company’s cash resources and needs for additional financing; the Company’s ability to produce products free of problems, defects, errors and vulnerabilities; the Company’s anticipated growth strategies, its expectations regarding competition, the anticipated trends and challenges in the Company’s business and the markets in which it operates; the Company’s expectations regarding, and the capacity and stability of, its supply chain and manufacturing; the size and growth of the potential markets for the Company’s products and the ability to serve those markets; the scope, progress, expansion and costs of developing and commercializing the Company’s products; the timing, rate and degree of introducing any of its products into the market and the market acceptance of any of its products; the Company’s ability to establish and maintain development partnerships; the Company’s

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ability to attract or retain key personnel; the Company’s expectations regarding federal, state and foreign regulatory requirements, including export controls, tax law changes and interpretations, economic sanctions and anti-corruption regulations; regulatory or legislative developments in the United States and foreign countries, including trade policy and tariffs and export control laws or regulations that could impede its ability to sell its products to its customer ZTE Kangxun Telecom Co. Ltd. or any of its affiliates or that could impede its ability to sell its products to other customers in certain foreign jurisdictions, particularly in China, or that could impede sales by such customers in the United States; the Company’s ability to obtain and maintain intellectual property protection for its products and other risks set forth under the caption “Risk Factors” in the Company’s most recent Annual Report on Form 10-K and subsequently filed quarterly reports on Form 10-Q filed with the SEC, and in other filings that the Company may make with the SEC from time to time. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on these forward-looking statements as indicative of future events. Except to the extent otherwise required by law, while we may elect to update forward-looking statements at some point in the future, we specifically disclaim any obligation to do so, even if our estimates change.

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THE SPECIAL MEETING

Time, Place and Purpose of the Special Meeting

This proxy statement is being furnished to our stockholders as part of the solicitation of proxies by the board of directors for use at the special meeting to be held on [—], 2021, starting at [—], Eastern time, or at any adjournment thereof. Due to public health and travel concerns related to coronavirus (COVID-19), the special meeting will be a virtual stockholder meeting, conducted via webcast. You may attend the special meeting online, vote your shares electronically and submit questions during the special meeting by visiting www.proxydocs.com/ACIA. You will need to have your control number, included on your proxy card or voting instruction form, to join and participate in the special meeting, and you will need to register for the special meeting in advance in order to virtually attend the special meeting by visiting www.proxydocs.com/ACIA. Instructions on how to attend and participate online will be provided to you via email after you register. The deadline for registering to virtually attend the special meeting is [—], Eastern time on [—], 2021. Approximately one hour prior to the start of the special meeting, you will receive further instructions via email, including your unique links that will allow you access to the meeting and will also permit you to submit questions. We encourage you to access the meeting 15 minutes prior to the start time to allow ample time to check your connection and visual and audio settings. If you encounter any difficulties accessing the virtual meeting prior to or during the meeting time, please call the technical support number provided to you in such emailed instructions for the special meeting.

At the special meeting, holders of Company common stock will be asked to approve the proposal to adopt the amended and restated merger agreement, to approve the nonbinding advisory proposal regarding compensation that may be payable to our named executive officers in connection with the merger and to approve the proposal to adjourn the special meeting, if necessary or appropriate, for the purpose of soliciting additional proxies if there are insufficient votes at the time of the special meeting to approve the proposal to adopt the amended and restated merger agreement.

Our stockholders must approve the proposal to adopt the amended and restated merger agreement in order for the merger to be consummated. If our stockholders fail to approve the proposal to adopt the amended and restated merger agreement, the merger will not be consummated. A copy of the amended and restated merger agreement is attached as Annex A to this proxy statement, which we encourage you to read carefully in its entirety.

Record Date and Quorum

We have fixed the close of business on [—], 2021 as the record date for the special meeting, and only holders of record of Company common stock on the record date are entitled to vote at the special meeting. You are entitled to receive notice of, and to vote at, the special meeting if you are the holder of record of Company common stock at the close of business on the record date. On the record date, there were [—] shares of Company common stock outstanding and entitled to vote. Each share of Company common stock entitles its holder to one vote on all matters properly coming before the special meeting.

A majority of the shares of Company common stock that are issued and outstanding at the close of business on the record date, present virtually or represented by proxy, at the special meeting constitutes a quorum for the purposes of the special meeting. Shares of Company common stock represented at the special meeting but not voted, including shares of Company common stock for which a stockholder directs voting “ABSTAIN”, as well as broker non-votes, will be counted for purposes of establishing a quorum. Because none of the proposals to be voted on at the special meeting are routine matters for which brokers may have discretionary authority to vote, the Company does not expect any broker non-votes at the special meeting. A quorum is necessary for us to be able to conduct business at the special meeting. Once a share of Company common stock is represented at the special meeting, it will be counted for the purpose of determining a quorum at the special meeting and any recess or adjournment of the special meeting. However, if a new record date is set for the adjourned special meeting, then a new quorum will have to be established. In the event that a quorum is not present at the special meeting, it is expected that the special meeting will be adjourned or recessed.

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Attendance

Only stockholders of record or their duly authorized proxies have the right to virtually attend the special meeting. Beneficial owners of shares are invited to virtually attend the special meeting. You will need to register in advance in order to virtually attend the special meeting. The deadline for registering to virtually attend the special meeting is [—], Eastern time on [—], 2021.

Vote Required

Approval of the proposal to adopt the amended and restated merger agreement requires the affirmative vote of the holders of a majority of the shares of Company common stock that are issued and outstanding as of the record date. For the proposal to adopt the amended and restated merger agreement, you may vote “FOR”, “AGAINST” or “ABSTAIN.” Voting “ABSTAIN” will not be counted as a vote cast in favor of the proposal to adopt the amended and restated merger agreement but will count for the purpose of determining whether a quorum is present. If you fail to submit a proxy or to vote online while virtually attending the special meeting, or if you vote “ABSTAIN”, it will have the same effect as a vote “AGAINST” the proposal to adopt the amended and restated merger agreement.

If your shares of Company common stock are registered directly in your name with our transfer agent, Computershare Trust Company, N.A., you are considered, with respect to those shares of Company common stock, the “stockholder of record.” This proxy statement and proxy card have been sent directly to you by the Company.

If your shares of Company common stock are held through a bank, brokerage firm or other nominee, you are considered the beneficial owner of shares of Company common stock held in “street name.” In that case, this proxy statement has been forwarded to you by your bank, brokerage firm or other nominee who is considered, with respect to those shares of Company common stock, the stockholder of record. As the beneficial owner of shares of Company common stock held in “street name,” you have the right to direct your bank, brokerage firm or other nominee how to vote your shares by following their instructions for voting. If you hold your shares of Company common stock in “street name,” please contact your bank, brokerage firm or other nominee for their instructions on how to vote your shares. Please note that if you are a beneficial owner of shares of Company common stock held in “street name” and wish to vote online while virtually attending the special meeting, you must request and obtain a legal proxy from your bank, brokerage firm or other nominee prior to the special meeting.

Under applicable stock exchange rules, banks, brokerage firms or other nominees who hold shares in “street name” for customers have the authority to vote on “discretionary” proposals when they have not received instructions from beneficial owners. However, banks, brokerage firms or other nominees are precluded from exercising their voting discretion with respect to approving non-discretionary matters, such as the proposal to adopt the amended and restated merger agreement, the proposal to approve the nonbinding advisory proposal regarding compensation that may be payable to our named executive officers in connection with the merger and the proposal to adjourn the special meeting, if necessary or appropriate, to solicit additional proxies, and, as a result, absent specific instructions from the beneficial owner of such shares of Company common stock, banks, brokerage firms or other nominees are not empowered to vote those shares of Company common stock on non-discretionary matters. Shares held by banks, brokerage firms or nominees that are present virtually or by proxy at the special meeting but with respect to which the broker or other stockholder of record is not instructed by the beneficial owner of such shares how to vote on a particular proposal and the broker does not have discretionary voting power on such proposal are referred generally as “broker non-votes.” These broker non-votes will be counted for purposes of determining a quorum, but will have the same effect as a vote “AGAINST” the proposal to adopt the amended and restated merger agreement. Because none of the proposals to be voted on at the special meeting are routine matters for which brokers may have discretionary authority to vote, the Company does not expect any broker non-votes at the special meeting.

Approval of the non-binding advisory proposal regarding compensation that may be payable to our named executive officers in connection with the merger and approval of the proposal to adjourn the special meeting, if

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necessary or appropriate, for the purpose of soliciting additional proxies, require a majority of the votes cast on each of these proposals. For the nonbinding advisory proposal regarding compensation that may be payable to our named executive officers in connection with the merger and the proposal to adjourn the special meeting, if necessary or appropriate, you may vote “FOR”, “AGAINST” or “ABSTAIN.” For purposes of each of these proposals, if you fail to submit a proxy or to vote online while virtually attending the special meeting, or if you have given a proxy and vote “ABSTAIN”, the shares of Company common stock will not be counted in respect of, and will not have any effect on, the proposal.

If you are a stockholder of record, you may vote your shares of Company common stock on matters presented at the special meeting in any of the following ways:

If you are a beneficial owner of Company common stock held in “street name,” you will receive instructions from your bank, brokerage firm or other nominee that you must follow in order to have your shares of Company common stock voted. Those instructions will identify which of the above choices are available to you in order to have your shares voted. Please note that if you are a beneficial owner of Company common stock held in “street name” and wish to vote online while virtually attending the special meeting, the voting instructions from your bank, brokerage firm or other nominee will contain your control number.

A control number, located on your proxy card, is designed to verify your identity and allow you to submit a proxy for your shares of Company common stock, and to confirm that your voting instructions have been properly recorded when submitting a proxy over the Internet or by telephone.

If you choose to submit your proxy over the Internet or by telephone, you must do so by the time the special meeting begins. If you choose to submit your proxy by mailing a proxy card, your proxy card must be received by the time the special meeting begins. Please do not send in your stock certificates with your proxy card. Following the consummation of the merger, a separate letter of transmittal will be mailed to you that will enable you to surrender your stock certificates and receive the per share merger consideration.

If you vote by proxy, regardless of the method you choose to submit a proxy, the individuals named as your proxies on the enclosed proxy card, and each of them, with full power of substitution, will vote your shares of Company common stock in the way that you indicate. When completing the Internet or telephone proxy processes or the enclosed proxy card, you may specify whether your shares of Company common stock should be voted for or against or to abstain from voting on all, some or none of the specific items of business to come before the special meeting.

If you properly sign your proxy card but do not mark the boxes showing how your shares of Company common stock should be voted on a matter, the shares of Company common stock represented by your properly signed proxy will be voted “FOR” the proposal to adopt the amended and restated merger agreement, “FOR” approval of the nonbinding advisory proposal regarding compensation that may be payable to our named executive officers in connection with the merger and “FOR” the proposal to adjourn the special meeting, if necessary or appropriate, to solicit additional proxies.

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If you have any questions or need assistance in submitting your proxy or voting your shares, please call The Proxy Advisory Group, LLC, our proxy solicitor, at (212) 616-2181.

IT IS IMPORTANT THAT YOU SUBMIT A PROXY FOR YOUR SHARES OF COMPANY COMMON STOCK PROMPTLY. WHETHER OR NOT YOU PLAN TO VIRTUALLY ATTEND THE SPECIAL MEETING, PLEASE COMPLETE, DATE, SIGN AND RETURN, AS PROMPTLY AS POSSIBLE, THE ENCLOSED PROXY CARD IN THE ACCOMPANYING PREPAID REPLY ENVELOPE, OR SUBMIT YOUR PROXY BY TELEPHONE OR THE INTERNET. STOCKHOLDERS MAY REVOKE THEIR PROXIES BY VOTING ONLINE WHILE VIRTUALLY ATTENDING THE SPECIAL MEETING.

Our Board’s Recommendation

The board of directors has unanimously determined that the terms and conditions of the merger and the amended and restated merger agreement are advisable, fair to and in the best interests of the Company and its stockholders and recommends that all Company stockholders vote in favor of the proposal to adopt the amended and restated merger agreement. The board of directors made its determination after consultation with its legal and financial advisors and consideration of a number of factors, as described in “The Merger — Reasons for the Merger; Recommendation of the Board of Directors” beginning on page [—]. The board of directors recommends that you vote “FOR” approval of the proposal to adopt the amended and restated merger agreement, “FOR” approval of the nonbinding advisory proposal regarding compensation that may be payable to our named executive officers in connection with the merger and “FOR” approval of the proposal to adjourn the special meeting, if necessary or appropriate, to solicit additional proxies.

Shares Owned by Our Directors and Executive Officers

As of the record date, the directors and executive officers of the Company beneficially owned and were entitled to vote, in the aggregate, [—] shares of Company common stock, representing approximately [—]% of the issued and outstanding shares of Company common stock on the record date. The directors and executive officers have informed the Company that they currently intend to vote all of their shares of Company common stock “FOR” the proposal to adopt the amended and restated merger agreement, “FOR” approval of the nonbinding advisory proposal regarding compensation that may be payable to our named executive officers in connection with the merger and “FOR” the proposal to adjourn the special meeting, if necessary or appropriate, to solicit additional proxies. In addition, the shares described above include shares beneficially owned by Murugesan Shanmugaraj, Benny Mikkelsen, Christian Rasmussen and Mehrdad Givehchi (including certain entities holding shares of Company common stock on their behalf) and such stockholders are obligated, pursuant to voting agreements entered into on January 14, 2021 between Parent and each of such stockholders, to vote such shares, representing approximately [—]% of the issued and outstanding shares of Company common stock on the record date, in favor of the adoption of the amended and restated merger agreement and any matter that would reasonably be expected to facilitate the merger.

Proxies and Revocation

Any stockholder of record entitled to vote at the special meeting may submit a proxy by telephone, over the Internet, or by returning the enclosed proxy card in the accompanying prepaid reply envelope, or may vote online while virtually attending the special meeting. If your shares of Company common stock are held in “street name” by your bank, brokerage firm or other nominee, please contact your bank, brokerage firm or other nominee for their instructions on how to vote your shares. If you fail to submit a proxy or to vote online while virtually attending the special meeting, or if you vote “ABSTAIN”, or if you do not provide your bank, brokerage firm or other nominee with voting instructions, your shares of Company common stock will not be voted on the proposal to adopt the amended and restated merger agreement, which will have the same effect as a vote “AGAINST” the proposal to adopt the amended and restated merger agreement.

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You have the right to revoke a proxy, whether delivered over the Internet, by telephone or by mail, at any time before it is exercised, by submitting a later-dated proxy through any of the methods available to you, by giving written notice of revocation to our Secretary, which must be received by the Company at Three Mill and Main Place, Suite 400, Maynard, Massachusetts 01754 by the time the special meeting begins, or by voting online while virtually attending the special meeting. Virtually attending the special meeting will not, in itself, revoke a previously submitted proxy. If you are a beneficial owner of our shares, you will need to contact your bank, brokerage firm, trustee, or other nominee to revoke any prior voting instructions.

Adjournments and Recesses

Although it is not currently expected, the special meeting may be adjourned or recessed, including for the purpose of soliciting additional proxies, if there are insufficient votes at the time of the special meeting to approve the proposal to adopt the amended and restated merger agreement or if a quorum is not present at the special meeting. Other than an announcement to be made at the special meeting of the time, date and place of an adjourned meeting, an adjournment generally may be made without notice. Any adjournment or recess of the special meeting for the purpose of soliciting additional proxies will allow the Company’s stockholders who have already sent in their proxies to revoke them at any time prior to their use at the special meeting as adjourned or recessed.

Stockholder List

A list of registered stockholders as of the close of business on the record date will be available for examination by any stockholder for any purpose germane to the special meeting at www.proxydocs.com/ACIA for a period of at least 10 days prior to the special meeting. Such list will also be available for examination by the stockholders during the whole time of the special meeting. Instructions regarding how to access the stockholder list will be provided in the emailed instructions that you will receive prior to the start of the meeting.

Anticipated Date of Completion of the Merger

We are working towards completing the merger as soon as possible. Assuming timely satisfaction of necessary closing conditions, including the approval by our stockholders of the proposal to adopt the amended and restated merger agreement, we currently anticipate that the merger will be consummated during the first quarter of the Company’s 2021 fiscal year, or prior to March 31, 2021.

Appraisal Rights

If the merger is completed, record holders of Company common stock as of the record date who submit a written demand for appraisal before the vote is taken on the adoption of the amended and restated merger agreement, do not vote in favor of the adoption of the amended and restated merger agreement, hold their shares of Company common stock continuously through the effective time of the merger and otherwise comply with the procedures set forth in Section 262 of the DGCL may elect to pursue their appraisal rights to receive, in lieu of the $115.00 per share merger consideration, an amount in cash equal to the judicially determined “fair value” of their shares, which fair value will be determined as of the effective time of the merger and could be more or less than, or the same as, the per share merger consideration for the common stock. For a summary of the procedures set forth in Section 262 of the DGCL, see “Appraisal Rights” beginning on page [—]. An executed proxy that is not marked “AGAINST” or “ABSTAIN” will be voted “FOR” the adoption of the amended and restated merger agreement and the stockholder submitting that proxy will lose the right to seek an appraisal of his, her or its shares of Company common stock.

A copy of Section 262 of the DGCL is included as Annex D to this proxy statement. Failure to follow the procedures set forth in Section 262 of the DGCL will result in the loss of appraisal rights. We encourage you to read these provisions carefully and in their entirety.

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ANY COMPANY STOCKHOLDER WHO WISHES TO EXERCISE APPRAISAL RIGHTS OR WHO WISHES TO PRESERVE HIS, HER OR ITS RIGHT TO DO SO SHOULD REVIEW ANNEX D CAREFULLY AND SHOULD CONSULT HIS, HER OR ITS LEGAL ADVISORS, SINCE FAILURE TO TIMELY AND FULLY COMPLY WITH THE PROCEDURES SET FORTH THEREIN WILL RESULT IN THE LOSS OF SUCH RIGHTS.

Solicitation of Proxies; Payment of Solicitation Expenses

The Company has engaged The Proxy Advisory Group, LLC to assist in the solicitation of proxies and provide related advice and informational support for the special meeting, for a services fee and the reimbursement of customary disbursements, which are not expected to exceed $30,000 in the aggregate. The Company will also indemnify The Proxy Advisory Group, LLC and its affiliates against certain claims, expenses, losses, damages, liabilities and judgments. The Company may also reimburse brokers, banks and other custodians, nominees and fiduciaries representing beneficial owners of shares of Company common stock for their expenses in forwarding soliciting materials to beneficial owners of Company common stock and in obtaining voting instructions from those owners. Our directors, officers and employees may also solicit proxies by telephone, by facsimile, by mail, on the Internet or in person. They will not be paid any additional amounts for soliciting proxies.

Householding of Special Meeting Materials

Some banks, brokerage firms and other nominee record holders may be participating in the practice of “householding.” This means that only one copy of our proxy statement may have been sent to multiple stockholders in your household. We will promptly deliver a separate copy of our proxy statement to you if you write, call or email us at:

Acacia Communications, Inc.

Three Mill and Main Place, Suite 400

Maynard, Massachusetts 01754

Attention: Investor Relations

(212) 871-3927

If you would like to receive separate copies of our proxy statements in the future, or if you are receiving multiple copies and would like to receive only one copy for your household, you should contact your bank, brokerage firm or other nominee record holder, or you may contact us at the above address or phone number.

Questions and Additional Information

If you have more questions about the merger or how to submit your proxy, or if you need additional copies of this proxy statement or the enclosed proxy card or voting instructions, please call The Proxy Advisory Group, LLC, our proxy solicitor, at (212) 616-2181.

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PARTIES TO THE MERGER

THE COMPANY

Acacia Communications, Inc.

Acacia Communications, Inc., which we refer to as the Company, is a Delaware corporation that develops, manufactures and sells high-speed coherent optical interconnect products that are designed to transform communications networks through improvements in performance, capacity and cost. By implementing optical interconnect technology in a silicon-based platform, a process Acacia refers to as the “siliconization of optical interconnect,” Acacia is able to offer products at higher speeds and density with lower power consumption, that meet the needs of cloud and service providers and can be easily integrated in a cost-effective manner with existing network equipment. Shares of Acacia common stock are traded on the Nasdaq Global Select Market under the symbol “ACIA.” The principal executive offices of Acacia are located at Three Mill and Main Place, Suite 400, Maynard, Massachusetts 01754, and its telephone number is (978) 938-4896.

For more information about the Company, see “Where You Can Find More Information” beginning on page [—].

PARENT

Cisco Systems, Inc.

Cisco Systems, Inc., which we refer to as Parent, is a Delaware corporation that designs and sells a broad range of technologies that have been powering the Internet since 1984. Parent is integrating intent-based technologies across networking, security, collaboration, applications and the cloud. These technologies are designed to help Parent’s customers manage more users, devices and things connecting to their networks. This will enable Parent to provide customers with a highly secure, intelligent platform for their digital business. Parent reincorporated from a California corporation into a Delaware corporation on January 25, 2021. The principal executive offices of Parent are located at 170 West Tasman Drive, San Jose, California 95134, and its telephone number is (408) 526-4000.

MERGER SUB

Amarone Acquisition Corp.

Amarone Acquisition Corp., which we refer to as Merger Sub, is a Delaware corporation that was formed solely for the purpose of entering into the amended and restated merger agreement and related agreements and consummating the merger and the other transactions contemplated thereby. Merger Sub is a wholly owned subsidiary of Parent and has not engaged in any business except for activities incidental to its formation and as contemplated by the amended and restated merger agreement. Upon the completion of the merger, Merger Sub will cease to exist and the Company will continue as the surviving corporation of the merger, which we refer to as the surviving corporation. The principal executive offices of Merger Sub are located at 170 West Tasman Drive, San Jose, California 95134, and its telephone number is (408) 526-4000.

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THE MERGER

This discussion of the merger is qualified in its entirety by reference to the amended and restated merger agreement, which is attached to this proxy statement as Annex A. You should read the entire amended and restated merger agreement carefully as it is the legal document that governs the merger.

The amended and restated merger agreement provides that Merger Sub will merge with and into the Company. The Company will be the surviving corporation in the merger and will continue to do business following the merger. As a result of the merger, the Company will cease to be a publicly traded company. You will not own any shares of the capital stock of the surviving corporation.

Changes to the Original Merger Agreement Pursuant to the Amended and Restated Merger Agreement

The original merger agreement was amended and restated pursuant to the amended and restated merger agreement to, among other things, (i) increase the per share merger consideration from $70.00 to $115.00 in cash, without interest and subject to deduction for any required withholding tax, (ii) eliminate certain conditions to the closing such as the elimination of the condition regarding the absence of a material adverse effect on the Company, (iii) narrow certain other conditions to the closing, such as limiting the condition with respect to the accuracy of the Company’s representations and warranties to certain fundamental representations and warranties (relating to the Company’s organization, good standing and qualification, capital structure, corporate authority and approval, brokers’ and advisors’ fees, the Company’s receipt of a fairness opinion and the information contained in this proxy statement), (iv) increase the termination fee payable by the Company under certain circumstance set forth in the amended and restated merger agreement in proportion to the increase in the per share merger consideration, from $120 million to $197 million and (v) amend the addendum to the Master Purchase Agreements by and between the Company, Parent and a wholly owned subsidiary of Parent, to provide that no fee is payable by Parent to the Company under any circumstances in connection with the merger or related transactions.

Overview of the Merger

The amended and restated merger agreement provides that Merger Sub will be merged with and into the Company, with the Company surviving the merger as a wholly owned subsidiary of Parent. The following will occur in connection with the merger:

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Following and as a result of the merger:

Directors and Officers of the Surviving Corporation

The directors of Merger Sub immediately prior to the effective time of the merger will be the initial directors of the surviving corporation. The officers of Merger Sub immediately prior to the effective time of the merger will be the initial officers of the surviving corporation.

Background of the Merger

The board of directors, together with members of the Company’s senior management, regularly reviews and assesses the Company’s operations, financial condition, and industry developments in the context of the Company’s strategic plans and, in connection with this review and assessment, periodically considers strategic acquisitions, strategic alliances, business combinations and other strategic alternatives.

On May 15, 2017, Raj Shanmugaraj, the President and Chief Executive Officer of the Company, had dinner with the Chief Executive Officer of a company that we refer to as “Party A” at the invitation of Party A. During the dinner, the Chief Executive Officer of Party A reflected on the potential benefits of a strategic combination of the Company and Party A, but did not propose a transaction.

On October 12, 2017, Mr. Shanmugaraj and Benny Mikkelsen, a director and Founder and Chief Technology Officer of the Company, met with the Chief Executive Officer of Party A at the Company’s headquarters at Party A’s request. The Chief Executive Officer of Party A expressed Party A’s interest, subsequently affirmed in a

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written indication of interest, in acquiring the Company for cash and stock consideration valued at $65 per share, consisting of 30% cash and 70% common stock of Party A. Mr. Shanmugaraj and Mr. Mikkelsen responded that the Company had not been contemplating a sale, but noted that they would review the offer with the board of directors. On October 11, 2017, the closing price for Company common stock on the Nasdaq Global Select Market was $46.20 per share.

From mid-October 2017 to mid-December 2017, the Company’s management engaged in discussions with the board of directors and Party A to evaluate the potential transaction. During this period, the Company executed a confidentiality agreement with Party A, which included a standstill provision that would terminate if the Company agreed to be acquired by a third party, and consulted Goldman Sachs & Co. LLC (“Goldman Sachs”) as its financial advisor and Wilmer Cutler Pickering Hale and Dorr LLP (“WilmerHale”) as its legal counsel. At a special meeting of the board of directors, held on December 18, 2017, a representative of WilmerHale reviewed the fiduciary duties of the board of directors and the board of directors instructed Goldman Sachs to respond to Party A’s proposal by informing Party A that it would need to make an offer above $70 per share to adequately compensate the Company for the risk of accepting Party A’s common stock as consideration and including a greater cash component. Representatives of Party A responded by saying they would discuss Party A’s strategic alternatives with their board, and thereafter abandoned the discussions. On December 15, 2017 (the immediately preceding trading day), the closing price for Company common stock on the Nasdaq Global Select Market was $39.38 per share.

Beginning in April 2018, representatives of the Company and a company we refer to as “Party B” engaged in preliminary discussions regarding a potential strategic combination, following a proposal by Party B to explore a stock-for-stock combination. The Company concluded that the future growth prospects of Party B, whose stock price had declined significantly over the preceding 12 months, were not attractive. Neither party pursued the matter beyond preliminary due diligence, and discussions ended in June 2018.

On April 15, 2018, the U.S. Department of Commerce activated a denial order against ZTE Kangxun Telecom Co. Ltd., the Company’s largest customer by revenue, accounting for approximately 20% and 31% of the Company’s revenue during fiscal year 2018 and the first quarter of 2019, respectively, which we refer to as ZTE, based on adverse findings relating to the activities covered by ZTE’s 2016 settlement with the U.S. Department of Commerce to resolve charges of export control violations by ZTE. This denial order added ZTE to the “Denied Persons List,” which, among other things, prohibited the Company from making sales and providing certain services to ZTE. On April 16, 2018, the first trading day following announcement of this decision, the closing price of Company common stock was $25.63 per share, representing a 36% decrease from the closing price of $40.03 per share on the previous trading day.

On June 1, 2018, Mehrdad Givehchi, Founder and Vice President of Hardware and Software of the Company, spoke by telephone to a representative of a company that we refer to as “Party C” at the request of Party C. The representative of Party C expressed interest in exploring a strategic partnership or an acquisition involving the Company in order to more effectively serve one of Party C’s markets.

On June 4, 2018, after consulting with other members of the Company’s senior management, Mr. Givehchi called the representative of Party C and expressed management’s concern that Party C might be seeking to exploit the recent decline in the Company’s stock price due to events involving ZTE, which management did not believe was indicative of the Company’s long-term value. The representative of Party C assured Mr. Givehchi that Party C was not “bottom fishing,” and the parties agreed to negotiate a confidentiality agreement and to schedule a meeting among members of management of both parties. On June 1, 2018 (the immediately preceding trading day) the closing price for Company common stock on the Nasdaq Global Select Market was $32.79 per share.

On June 8, 2018, the Company and Party C executed a confidentiality agreement and scheduled the management meeting for June 20, 2018. The confidentiality agreement included a standstill provision that would terminate if the Company agreed to be acquired by a third party.

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Also on June 8, 2018, ZTE and the U.S. Department of Commerce reached a new settlement imposing additional penalties and compliance measures upon ZTE, pursuant to which the denial order was terminated and ZTE was removed from the Denied Persons List effective July 13, 2018. This further U.S. Department of Commerce action authorized the Company to resume sales to, and related activities involving, ZTE.

On June 20, 2018, members of Company management attended a meeting at Party C’s headquarters with representatives of Party C at which management presented information regarding the Company’s business and discussed strategic partnership opportunities with Party C.

On June 22, 2018, Mr. Shanmugaraj received an email from a representative of Party C, indicating that the possibility of a strategic transaction with the Company would be discussed among senior management at Party C, and that Party C expected to follow up with the Company in the next couple of weeks with additional information.

On June 25, 2018, Mr. Shanmugaraj sent an email to the board of directors updating them on the discussions to date with Party C and notifying them that the Company might receive a proposal from Party C.

On July 2, 2018, the Company received a letter from Party C containing a non-binding expression of interest in acquiring the Company at a price of $41 per share. On June 29, 2018 (the immediately preceding trading day), the closing price for Company common stock on the Nasdaq Global Select Market was $ 34.81 per share.

On July 6, 2018, the board of directors held a telephonic special meeting to discuss the letter from Party C. At the meeting, a representative of WilmerHale reviewed the fiduciary duties of the board of directors regarding their consideration of a potential strategic transaction. After discussion of the proposed price, the perceived dislocation in the current trading price given the recent denial order against ZTE and the Company’s standalone prospects, the board of directors concluded that the offer was too low to accept or to justify further discussions. The board of directors instructed Mr. Shanmugaraj to reject the offer.

On July 10, 2018, Mr. Shanmugaraj telephoned a member of senior management of Party C and informed him that the expression of interest significantly undervalued the Company, and that the Company could not accept the proposed terms.

On July 13, 2018, a representative of Party C contacted Mr. Givehchi via text to request a meeting. After consultation with other members of Company management, Mr. Givehchi agreed to a meeting on July 17, 2018.

On July 17, 2018, Mr. Givehchi met with the representative of Party C over coffee at a location outside of Boston. The representative of Party C expressed regret that Party C had not presented a more attractive offer to the Company, noting that certain members of senior management of Party C had doubts about the competitive position of the Company and had been unwilling to agree to a higher price. The representative noted that Party C would continue to monitor the Company’s performance and guidance to determine whether a stronger case could be made in support of a transaction in the future. Later that day, Mr. Givehchi updated the board of directors on his conversation with the representative from Party C during a regularly scheduled meeting of the board of directors.

The Company periodically prepares and updates internal projections for internal budgeting and business planning purposes. On October 18, 2018, the board of directors held a regularly scheduled meeting at which senior management presented internal projections for the fiscal years ending December 31, 2019 through 2021 and engaged in a strategic discussion with the board of directors regarding the Company’s product roadmap and markets.

On February 23, 2019, following an introductory email from Bill Gartner, Senior Vice President and General Manager of the Optical Systems and Optics business unit of Parent, David Goeckeler, the Executive Vice

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President and General Manager of Parent’s Networking and Security Business, contacted Mr. Shanmugaraj by email requesting a telephone call. Parent had been a customer of the Company since 2015, accounting for 14% of the Company’s reported revenues for the fiscal year ended December 31, 2018, and would account for 18.1% of the Company’s reported revenues for the fiscal quarter ended March 31, 2019.

On February 25, 2019, Messrs. Goeckeler and Shanmugaraj spoke by telephone. Mr. Goeckeler expressed Parent’s interest in exploring strategic opportunities with the Company, ranging from partnership opportunities to the possibility of an acquisition. They agreed to meet to discuss further.

On March 1, 2019, Mr. Shanmugaraj received an email from Mr. Goeckeler in which he suggested, as the next step, an in-person meeting between Messrs. Goeckeler, Gartner, Shanmugaraj and Mikkelsen in the near future.

On March 5, 2019, Mr. Gartner contacted Mr. Shanmugaraj by text to request that he meet representatives of Parent for dinner the following night while both parties attended the Optical Fiber Communication Conference in San Diego.

On March 6, 2019, Mr. Shanmugaraj and Mr. Mikkelsen met Messrs. Goeckeler and Gartner for dinner. Mr. Goeckeler described Parent’s desire and rationale for pursuing a strategic partnership with the Company, and both parties concluded that it was worth exploring further and agreed to arrange a meeting with additional members of management from both companies. Thereafter, the Company and Parent scheduled a meeting at Parent’s offices in San Jose, California among members of management from both parties to be held on March 21, 2019.

On March 17, 2019, the Company and Parent executed a confidentiality agreement. The confidentiality agreement included a standstill provision that would terminate if the Company agreed to be acquired by a third party.

During March 2019, the Company prepared an update to the internal projections for the fiscal years ending December 31, 2019 through 2021 that had been presented to the board of directors on October 18, 2018 (which updated projections the Company referred to as the “Long-Range Plan”) in order to reflect subsequent developments, including (i) increased operating costs, including costs observed over the intervening period and research and development related costs due to a new product development program that had been launched internally in late December 2018, (ii) subsequent increases in revenue expected for the new product launched in December 2018 partially offset in 2021 by lower introductory revenue for a new product expected to initially enter production in late 2020 and (iii) decreases in gross margins resulting from changes in product mix and observed changes to product costs over the intervening period.

On March 21, 2019, members of Company management attended a meeting at Parent’s offices in San Jose, California with representatives of Parent at which management presented information regarding the Company’s business, including the Long-Range Plan, and discussed strategic partnership opportunities with Parent.

On March 31, 2019, Mr. Goeckeler called Mr. Shanmugaraj to inform him that further evaluation of a potential transaction would be managed by Parent’s corporate development team, and that Rob Salvagno, Parent’s Vice President of Corporate Development and Cisco Investments, would be in contact with Mr. Shanmugaraj to continue the discussions.

On April 1, 2019, Mr. Salvagno called Mr. Shanmugaraj to communicate a proposal by Parent to acquire the Company at $62 per share. On March 29, 2019 (the immediately preceding trading day), the closing price for Company common stock on the Nasdaq Global Select Market was $57.35 per share.

On April 3, 2019, Mr. Shanmugaraj called Mr. Salvagno to inform him that Parent’s proposal did not reflect a sufficient premium to warrant further discussion with respect to a potential transaction. Mr. Shanmugaraj noted that the parties could continue to work together in the context of their commercial relationship.

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On April 10, 2019, Mr. Salvagno called Mr. Shanmugaraj to inform him that Parent was increasing its offer to $67 per share. Mr. Shanmugaraj told Mr. Salvagno that he would discuss the offer with the board of directors and get back to him afterwards. On April 9, 2019, the closing price for Company common stock on the Nasdaq Global Select Market was $57.72 per share.

On April 11, 2019, a representative of Party C contacted Mr. Shanmugaraj by text to request a meeting on April 15, 2019.

On April 15, 2019, Mr. Shanmugaraj met the representative of Party C for lunch in Boston. The representative indicated that members of senior management of Party C had been discussing the potential strategic importance of the Company to Party C and wanted to gauge the Company’s interest in exploring a strategic transaction. Mr. Shanmugaraj expressed skepticism based on the prior acquisition proposal from Party C, but said he would keep an open mind with respect to any proposal that reflected the strategic value of the Company.

On April 17, 2019, the board of directors held a telephonic special meeting with members of senior management and a representative of WilmerHale present. Mr. Shanmugaraj described to the board of directors his discussions with Parent to date, including the $67 per share offer by Parent. John Gavin, the Chief Financial Officer of the Company, next reviewed the Long-Range Plan with the board of directors, and presented management’s assessment of potential risks to achieving the results forecast in the projections, including the potential weakening (and potential loss longer term) of the customer relationship with Parent if it shifted purchasing to a second source, sought to develop competitive technology internally or pursued an acquisition of a Company competitor in lieu of completing a transaction with the Company. The board of directors then compared the potential risks and benefits of pursuing a transaction with Parent versus other strategic alternatives, including continuing to operate on a standalone basis. One of the major risks to pursuing a transaction with Parent that the board of directors discussed was the potential that other customers might not view Parent as committed to serving as a long-term supplier of components to third parties and the potential implications on the ability to receive regulatory approval for a transaction. One of the standalone alternatives discussed was an acquisition of assets from a company we refer to as “Party D” then under consideration by management. The board of directors noted that Parent’s proposal was not a significant premium over the current trading price of Company common stock, which had closed at $60.59 per share on April 16, 2019. The board of directors also discussed the fact that the Company would be making its quarterly earnings announcement in approximately two weeks, and expected to report strong results for the first quarter, exceeding analyst expectations and prior Company guidance. The board of directors concluded that Mr. Shanmugaraj should tell Parent that any further discussions should be deferred until after the upcoming earnings announcement.

On April 19, 2019, Mr. Shanmugaraj called Mr. Salvagno to inform him that the board of directors had concluded that further discussions should be deferred until after the Company’s upcoming earnings announcement.

During May 2019, there were several events reflecting worsening trade relations between China and the United States, including the failure of China and the United States to negotiate a trade deal prior to the May 9 deadline set by the United States, the imposition of additional tariffs by the United States the following day, the imposition of additional tariffs by China in response, and the addition of Huawei Technologies Co., Ltd. and certain of its affiliates, referred to collectively as Huawei, to the “Entity List” by the U.S. Department of Commerce. During May 2019, the closing price of the Company’s common stock on the Nasdaq Global Select Market declined from $60.45 per share on May 1 to $46.60 per share on May 31.

On May 2, 2019, the Company reported first quarter 2019 results, exceeding the high end of Company guidance on revenue, non-GAAP gross margin, non-GAAP net income and non-GAAP diluted earnings per share, and held a call to discuss such results. On May 3, 2019, the closing price for Company common stock on the Nasdaq Global Select Market was $59.00 per share, as compared to the closing price of $60.55 per share on May 2, 2019, prior to the reporting of its first quarter results.

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On May 3, 2019, a representative of Party C contacted Mr. Shanmugaraj by email to propose a meeting between Mr. Shanmugaraj and members of Party C’s senior management to explore strategic options.

On May 10, 2019, the board of directors held a telephonic special meeting with members of senior management and a representative of WilmerHale present. The board of directors discussed strategic alternatives to a transaction with Parent, including continuing to operate on a standalone basis and pursuing the asset acquisition discussed at the April 17, 2019 board of directors meeting. The Company’s management provided an updated assessment of the potential risks and benefits of remaining a standalone entity in light of recent market and customer developments, including the worsening trade relations between China and the United States and the potential weakening (and potential loss longer term) of the customer relationship with Parent if it shifted purchasing to a second source, sought to develop competitive technology internally or pursued an acquisition of a Company competitor in lieu of completing a transaction with the Company, as well as the continued volatility in the price of Company common stock, as witnessed by the price decline following the recent announcement of a successful first quarter. The board of directors authorized management to submit a non-binding indication of interest with respect to the potential acquisition of assets from Party D, but concluded that the board of directors should continue to discuss whether to pursue a transaction with Parent at the regularly scheduled board of directors meeting on May 16, 2019, and that management should be prepared to discuss its recommendation at that meeting.

On May 13, 2019, Mr. Shanmugaraj called the representative of Party C and informed the representative that the board of directors was skeptical of further engagement with Party C in light of the offer made the prior year, which the board of directors felt undervalued the Company significantly. Mr. Shanmugaraj told the representative that Party C should provide a firm proposal that shows they are serious about the strategic value of the Company before the Company would engage in further discussions. The representative of Party C acknowledged Mr. Shanmugaraj’s request and suggested a further discussion between Mr. Shanmugaraj and the Chief Executive Officer of Party C.

On May 14, 2019, Mr. Salvagno emailed Mr. Shanmugaraj to inquire about the status of the Company’s consideration of Parent’s proposal. Mr. Salvagno and Mr. Shanmugaraj then spoke by telephone the following day, and Mr. Shanmugaraj informed Mr. Salvagno that he would be working with the board of directors to prepare a response to the April 10, 2019 proposal.

On May 16, 2019, the board of directors held a regularly scheduled meeting with members of senior management and a representative of WilmerHale present for certain portions. Mr. Gavin reviewed the Company’s Long-Range Plan, which had been provided to Parent and previously discussed at the April 17, 2019 board of directors meeting, as well as recent customer, product and market developments that could affect projected revenue in the second half of 2020 and in 2021. Next, Mr. Shanmugaraj discussed management’s perspective on the potential risks and benefits of exploring a strategic transaction with Parent as an alternative to standalone operations and provided management’s recommendation that the Company further explore pursuing a strategic transaction with Parent, but in a manner designed not to result in any leaks to the market, given the customer concerns previously discussed. Mr. Shanmugaraj also described the outreach from and discussions with Party C, noting the uncertainty as to whether this would result in a viable alternative. The board of directors then discussed with management the potential risks to achieving the projected revenues in 2020 and 2021, the potential impact of worsening trade relations between China and the United States, the potential impact that recent actions by the U.S. Department of Commerce against Huawei could have on overall optical market timing and spending expectations in China and the potential risks and benefits of a strategic transaction with Parent. The board of directors then concluded that the Company should explore a potential strategic transaction with Parent, and instructed management that the next step should be to consult with financial and legal advisors on process, valuation and other matters. The board of directors then directed Mr. Shanmugaraj to communicate the Company’s interest in further discussions to Parent and authorized management to contact Goldman Sachs, which was selected based on its prior service as the Company’s financial advisor, to discuss its potential retention as the Company’s financial advisor for a potential sale transaction. The board of directors next discussed the

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status of the potential asset acquisition with Party D and whether to proceed in light of the decision to pursue further discussions with Parent. Messrs. Shanmugaraj and Gavin reported that the Company had been told its indication of interest was not in an appropriate value range, and that further engagement would not continue without an upward adjustment. They also reported that, as a result of an organizational change, Party D may be deferring further consideration of any strategic transaction for an indeterminate period of time. The board of directors concluded that the Company should delay any further activity with respect to the potential asset acquisition until it had an opportunity to further explore a transaction with Parent.

On May 17, 2019, a member of the board of directors and Company management each contacted Goldman Sachs to initiate discussions regarding its potential engagement as the Company’s financial advisor.

On May 20, 2019, Mr. Salvagno called Mr. Shanmugaraj to express concerns regarding recent global events and what impact they might have on the Company’s business, including recent actions by the U.S. Department of Commerce against Huawei, the applicability of existing and future tariffs imposed on the Company’s products and ongoing trade discussions between the U.S. and China governments and requested that Mr. Shanmugaraj provide Parent further information supporting the Company’s views that the potential impact of the actions with respect to Huawei would not adversely affect the Company’s business during the remainder of 2019.

Also on May 20, 2019, a representative of Party C called Mr. Shanmugaraj and again suggested that Mr. Shanmugaraj speak to the Chief Executive Officer of Party C by telephone in order to confirm Party C’s strategic interest in the Company and commitment to exploring a strategic transaction at valuation ranges that might be attractive. Following an exchange of emails between Mr. Shanmugaraj and the representative of Party C, Mr. Shanmugaraj agreed to a call between himself and the Chief Executive Officer of Party C, which was scheduled for May 24, 2019.

On May 23, 2019, members of Company management attended a telephonic meeting with representatives of Parent at which management presented information requested by Mr. Salvagno on the May 20, 2019 telephone call. During the meeting, the Company’s management expressed its willingness to bring Parent’s $67 per share offer back before the board of directors for further discussion. In response, Parent noted that they needed to reassess their valuation in light of recent events and the information presented by the Company.

On May 24, 2019, Mr. Shanmugaraj spoke to the Chief Executive Officer of Party C by telephone. During the call, the Chief Executive Officer of Party C described Party C’s interest in the Company and his vision of the potential strategic benefits of a transaction between the two companies. At the end of the call, the Chief Executive Officer of Party C invited Mr. Shanmugaraj to a dinner to discuss next steps for exploring the possibility of a transaction. The dinner was scheduled for June 4, 2019.

On June 4, 2019, Mr. Shanmugaraj spoke to Mr. Salvagno, who communicated that Parent remained interested in pursuing a strategic transaction with the Company but, in light of recent market developments, was now prepared to offer only $62 per share. On June 3, 2019, the closing price for Company common stock on the Nasdaq Global Select Market was $46.50 per share.

Later on June 4, 2019, Mr. Shanmugaraj had dinner with the Chief Executive Officer of Party C, who reiterated that Party C was interested in continuing to explore a strategic transaction with the Company. The Chief Executive Officer expressed his expectation that Party C would submit an offer, but noted that Party C’s management would need additional financial and product information before Party C would be in the position to submit a proposal. Mr. Shanmugaraj agreed that the Company would work with Party C’s management to provide the requested information.

On June 6, 2019, the Company and Party C executed an amendment to the confidentiality agreement entered on June 8, 2018, which reinstated the standstill provision for an additional nine months and otherwise extended the term of the confidentiality agreement for an additional two years. The standstill provision, as amended, would terminate if the Company agreed to be acquired by a third party.

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Later on June 6, 2019, members of Company management met with representatives of Party C to provide additional product and financial information. At this meeting, the members of Company management presented projections for 2019 through 2024, referred to as the June LRP, which reflected updates to the Long-Range Plan subsequently discussed at the June 8, 2019 board of directors meeting as described below.

On June 7, 2019, Mr. Shanmugaraj sent an email to Mr. Salvagno with an update on the board of director’s discussions, and indicating that the board of directors was continuing to consider Parent’s offer.

On June 8, 2019, the board of directors held a telephonic special meeting with members of senior management and representatives of Goldman Sachs and WilmerHale present for certain portions. Mr. Gavin provided the board of directors with the June LRP, which reflected projections for 2019 through and including 2024 proposed for use by Goldman Sachs to prepare financial analyses, noting that the three additional years of projections were added to facilitate a discounted cash flow analysis. Mr. Gavin described the detailed and updated review undertaken of the Company’s product roadmap, customer and market developments to prepare the projections, as well as the key assumptions underlying them. In particular, Mr. Gavin noted somewhat lower projected revenue in 2020 than in the prior projections for 2019 through 2021, based on a slower increase in the production rate for a new Company product due to the complexity of scaling initial production and the potential impact of trade and tariff discussions and actions by the U.S. Department of Commerce against Huawei on overall optical market timing and spending expectations in China. He also noted the impact these factors were anticipated to have on projected revenues in 2021, where growth rates were similar to those in the Long-Range Plan, but were growing from a lower base. Thereafter, the board of directors approved the June LRP for use by Goldman Sachs for purposes of its financial analyses. Representatives of Goldman Sachs reviewed an overview of public market data, a comparison of the Company’s internal projections against published analyst estimates (which analyst estimates were generally more conservative) and certain illustrative preliminary financial analyses. The representatives of Goldman Sachs then discussed certain process considerations with the board of directors, including the merits of doing a targeted approach to other potential strategic partners that were likely to be interested in and capable of executing a transaction on acceptable terms. Mr. Shanmugaraj again emphasized the competitive harm that could result from a leak regarding any sale process, and provided his assessment of potential candidates for future outreach. Mr. Shanmugaraj identified the five additional parties (beyond Parent, but including Party C) that he considered the most promising candidates from a strategic fit perspective. He noted that Party C had reached out to reengage in exploring a potential strategic transaction and was already having preliminary discussions with the Company, and that another party on the list had already declined the opportunity (based on outreach by Mr. Shanmugaraj to a director of the Company who was affiliated with such party to determine whether such director, who had previously been excluded from all discussions of the board of directors of a potential transaction, should continue to be excluded from discussions of a potential transaction). Mr. Shanmugaraj then noted that two other parties on the list did not have a presence in the coherent optical market and lacked the financial capacity to make a competitive all-cash offer. He further noted that pursuing a non-cash transaction with these two parties was not attractive given his view of their prospects and the risk that the delay associated with exploring non-cash consideration could jeopardize a potential transaction with Parent. He then stated that the fifth party on the list either had, or had the ability to develop, its own internal coherent optical technologies and, in any event, was unlikely to come up to speed on the Company’s technology, customers and markets quickly. Consequently, Mr. Shanmugaraj recommended continuing discussions with Parent and Party C without additional outreach at that time. The board of directors then discussed next steps for engaging with Parent and Party C and the desirability of confirming with Parent that any subsequent proposal by Parent would be for an all-cash transaction, given the greater value certainty provided by cash consideration. The board of directors instructed Mr. Shanmugaraj to respond to Parent with a counter-proposal of $72 per share in an all-cash transaction, and to advise Parent that the Company would be willing to proceed with formal due diligence at that price. The board of directors also directed Mr. Shanmugaraj to continue discussions with Party C to determine whether Party C could provide an attractive proposal. Finally, in anticipation of the possibility that discussions could accelerate if Parent agreed to a price at which the Company would be willing to proceed with negotiations and formal due diligence, the board of directors discussed formation of a Transaction Committee to allow for flexible and timely support of management under circumstances when it might not be practical to

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assemble the full board of directors. The board of directors agreed that all directors would be invited to attend meetings of the Transaction Committee, and that the Transaction Committee should be formed by written consent following the meeting.

On June 11, 2019, Mr. Shanmugaraj spoke to Mr. Salvagno by telephone and informed him that the board of directors had evaluated the Company’s standalone prospects and felt the current weakness in stock price was attributable to short-term volatility that had nothing to do with the long-term prospects the Company. Mr. Shanmugaraj noted that Parent’s offer of $62 per share was just at the 12-month high price with no premium and failed to capture this long-term value. Mr. Shanmugaraj stated that the Company was prepared to initiate formal due diligence and engage in further discussions to explore a potential transaction if Parent increased its offer to $72 per share. Mr. Shanmugaraj also informed Mr. Salvagno that the Company was using Goldman Sachs as its financial advisor.

On June 12, 2019, Mr. Shanmugaraj received an email from the Chief Executive Officer of Party C thanking Mr. Shanmugaraj for their recent meeting and indicating that he expected to be back to the Company with additional information late the following week.

On June 13, 2019, Mr. Salvagno called Mr. Shanmugaraj and told him that Parent was concerned about the potential negative impact on the Company of current market conditions and felt that $62 per share was a fair value. Mr. Salvagno then stated that Parent was nonetheless willing to increase its offer to $64.50 per share, noting that it had difficulty getting to this price. On June 12, 2019, the closing price for Company common stock on the Nasdaq Global Select Market was $46.90 per share.

On June 17, 2019, the board of directors held a telephonic special meeting with members of senior management and representatives of Goldman Sachs and WilmerHale present for certain portions. Mr. Shanmugaraj provided the board of directors with an update on the status of discussions with Parent and Party C, informing the board of directors that Parent had increased its offer to $64.50 per share, but that Parent expressed difficulty in getting to this price. Mr. Shanmugaraj noted that there had been ongoing communications with Party C, but that Party C had still not provided any indication of value. Representatives of Goldman Sachs then presented illustrative preliminary financial analyses of Parent’s proposal of $64.50 per share. The representatives of Goldman Sachs also discussed the potential for Parent to further increase its offer for the Company. There followed a discussion of the possibility of Party C placing a bid for the Company given their demonstrated interest. The representatives of Goldman Sachs expressed their view that Parent and Party C presented the best combination of strategic fit and ability to provide an attractive, all-cash offer. The representatives of Goldman Sachs and Mr. Shanmugaraj then provided their respective views on the remaining prospective outreach candidates, which included Party A, noting that one had already declined to pursue the opportunity and that each of the remaining parties was significantly less likely to make a competitive proposal at that point in time due to one or more of a variety of factors, including: (i) lack of strategic fit, (ii) low probability of interest in light of strategic priorities, (iii) lack of familiarity with the Company’s technology, (iv) lack of ability to finance a competitive, all-cash offer, (v) concerns over the prospects of parties that would need to offer stock consideration and (vi) the low probability of a timely offer or attractive valuation in light of such party’s historical M&A activity. In addition, Mr. Shanmugaraj reiterated his concern that expanding the process would likely result in rumors regarding a potential sale and have a significant negative impact on the Company. Mr. Shanmugaraj also observed that the remaining parties on the list were unlikely to be able to act as quickly as Parent and Party C had each indicated they desired to move, and that any significant delay could put Parent’s proposal and any proposal received from Party C at risk. A representative of WilmerHale then reviewed the fiduciary duties of the board of directors and the application of those duties in the context of a potential sale transaction. The board of directors then asked whether senior management supported continued pursuit of a potential sale transaction with Parent at $64.50 per share. Mr. Shanmugaraj stated that the price offered by Parent reflected an appropriate valuation when compared with management’s assessment of the risks associated with standalone operations, where even if the Company executed its business plan, stockholders would be exposed to risks associated with the expected continued volatility resulting from the Company’s exposure to China—where the two largest Chinese customers by revenue

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accounted for approximately 27% and 39% of the Company’s revenue during fiscal year 2018 and the first fiscal quarter of 2019, respectively — under the current political and macroeconomic climate, as well as the risks to the Company’s relationship with Parent as a key customer if a transaction were not pursued, and that management thus viewed this as an attractive outcome for stockholders and supported continuing the sale process as a result. The board of directors then asked Mr. Shanmugaraj if Parent had communicated its plans for management. Mr. Shanmugaraj replied that no arrangements had been discussed. Mr. Shanmugaraj then stated that his impression, based on discussions with Parent, was that the Company would likely have a certain degree of independence for a transitional period following the closing. After further consultation with management, the board of directors concluded that management and Goldman Sachs should propose to Parent that it increase its bid to $67 per share. The board of directors noted the importance of clarifying other key terms of Parent’s proposal, including what commitments Parent was willing to make to obtain required regulatory approvals. The board of directors directed management to inform Party C that the Company was likely to move forward with another party in the near term unless Party C acted quickly to make a more specific proposal. Finally, in light of the risks associated with further outreach and the low probability that it would result in an offer that would be competitive with Parent’s current offer, the board of directors determined not to pursue outreach to additional parties at that time.

Later on June 17, 2019, Mr. Shanmugaraj spoke to Mr. Salvagno by telephone and delivered the Company’s counter-proposal to Parent of $67 per share, noting that Parent had been prepared to offer $67 per share at the outset of discussions and that he believed he could get the board of directors to accept this original proposal. Mr. Shanmugaraj went on to note that the Company felt $67 per share was a fair value of the Company based on its long-term prospects. Mr. Salvagno agreed to follow up with feedback to Mr. Shanmugaraj within the next few days.

Also on June 17, 2019, in anticipation of the possibility that discussions could accelerate if Parent agreed to a price at which the Company would be willing to proceed with negotiations and formal due diligence, the board of directors established the Transaction Committee, consisting of directors David Aldrich, Peter Chung, Stan Reiss and John Ritchie, by unanimous written consent to allow for flexible and timely support of management under circumstances when it might not be practical to assemble the full board of directors.

On June 18, 2019, Mr. Shanmugaraj spoke to the Chief Executive Officer of Party C by telephone. The Chief Executive Officer of Party C stated that Party C was still interested in exploring a transaction, but noted that it still needed to complete further due diligence to validate the business case for the transaction and to complete its valuation. In response to further inquiry from Mr. Shanmugaraj, the Chief Executive Officer of Party C said that Party C expected its proposal to value the Company between $2.5 and $3.0 billion, but that he could not provide more than a range at that time. Mr. Shanmugaraj responded that Party C would need to be at the high end of this range to be competitive. On June 17, 2019, the closing price for Company common stock on the Nasdaq Global Select Market was $44.79 per share.

Also on June 18, 2019, representatives of Goldman Sachs spoke by telephone with the Chief Financial Officer of Party C, who indicated that Party C had more technical diligence to do, as it did not have significant familiarity with the Company’s products. The Chief Financial Officer of Party C also stated that he hoped to have preliminary due diligence completed by the end of that week.

Also on June 18, 2019, Mr. Shanmugaraj spoke to Mr. Salvagno by telephone. Mr. Salvagno stated that Parent was willing to increase its offer to $65.50 per share and confirmed that this offer reflected an all cash transaction that would be subject only to customary closing conditions. Mr. Salvagno expressed confidence in the parties’ ability to obtain regulatory clearance, but did not provide further details. Mr. Salvagno then indicated that Parent was targeting a signing in two to three weeks. On June 17, 2019, the closing price for Company common stock on the Nasdaq Global Select Market was $44.79 per share.

On June 19, 2019, the Transaction Committee held a telephonic meeting with other members of the board of directors and senior management and representatives of WilmerHale present and representatives of Goldman

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Sachs present for certain portions. Mr. Shanmugaraj provided an update on his conversations with Parent and Party C, noting that Parent had increased its bid to $65.50 per share and had requested a prompt response. He also noted that Party C had suggested its bid would value the Company in the range of $2.5 billion to $3.0 billion. A representative of Goldman Sachs then described his separate conversations with representatives of Party C, expressing concern about the breadth of the range communicated by Party C. The representatives of Goldman Sachs recommended continuing to support Party C’s due diligence efforts. Goldman Sachs next provided its perspective on the $65.50 per share offer from Parent. The board of directors then discussed with its legal and financial advisors whether it was realistic to expect Parent to raise its price further absent competitive pressure, and that to continue to condition diligence meetings and information on further price increases would put Parent’s offer at risk. Upon the recommendation of management, the board of directors concluded that the Company should communicate to Parent that the Company was willing to engage in detailed due diligence and negotiations at the current price, but would need further assurance and clarity regarding Parent’s proposal to obtain regulatory approval and share the risk of not obtaining approval. The board of directors also concluded the Company should continue to support Party C’s due diligence in the hope of eliciting a more specific proposal. After the representatives of Goldman Sachs left the meeting, a representative of WilmerHale reviewed the proposed terms of a Goldman Sachs engagement letter with the Transaction Committee, along with a disclosure letter provided by Goldman Sachs, which summarized Goldman Sachs’ relationship with Parent and Party C over the last two years, including information regarding compensation for financial advisory and/or underwriting services provided by its Investment Banking Division to Parent and/or its affiliates and the presence of a director on the board of directors of Parent that is currently affiliated with the Goldman Sachs Group, Inc. as a director.

Later on June 19, 2019, Mr. Shanmugaraj spoke to Mr. Salvagno by telephone and informed him that the board of directors was willing to engage in detailed due diligence and negotiations at Parent’s offer price of $65.50 per share. Mr. Shanmugaraj impressed upon Mr. Salvagno that the most significant remaining concern of the board of directors was understanding the commitments that Parent was willing to make to mitigate the potential risks to obtain required regulatory approvals for the transaction.

On June 20, 2019, members of the Company’s management spoke by telephone with representatives of Party C at Party C’s request and provided information regarding the Company’s business in response to due diligence questions from Party C.

Also on June 20, 2019, Mr. Salvagno sent an email to Mr. Shanmugaraj with a list of due diligence requests. He also informed Mr. Shanmugaraj that Parent expected to deliver a draft of the original merger agreement in the next day or two.

Also on June 20, 2019, a representative from Goldman Sachs received a text from the Chief Financial Officer of Party C, asking to speak over the phone on June 21, 2019, and noting that Party C would be submitting a proposal on June 21, 2019.

On June 21, 2019, counsel to Parent Fenwick & West LLP, which we refer to as Fenwick, delivered a draft original merger agreement to WilmerHale. From June 21 to July 8, 2019, Fenwick and WilmerHale negotiated the terms of the definitive original merger agreement, including the provisions relating to (i) the allocation of the risks associated with regulatory approvals, (ii) restrictions on the Company’s operations between signing and closing, (iii) the ability of the board of directors to respond to unsolicited acquisition proposals, change its recommendation and accept a superior proposal, (iv) the amount and triggers for the Company’s termination fee, (v) the closing conditions, (vi) the definition of a material adverse effect and (vii) the scope of the representations and warranties.

Also on June 21, 2019, a representative of Party C called a representative of Goldman Sachs and informed him that Party C expected to deliver a written indication of interest in acquiring the Company for $73 per share in cash, with no financing contingency. A representative of Party C also called Mr. Shanmugaraj and provided this same information. Later that day, Party C delivered a non-binding indicative offer letter expressing Party C’s

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interest in acquiring the Company at $73 per share in cash, subject to the satisfactory completion of due diligence, negotiation of a mutually acceptable merger agreement and final approval of Party C’s board of directors. The letter indicated that the completion of the transaction would not be subject to any financing contingency. The letter indicated that Party C expected that a definitive agreement for such a transaction could be signed by the week of July 8, 2019. On June 20, 2019, the closing price for Company common stock on the Nasdaq Global Select Market was $47.38 per share.

On June 22, 2019, the Transaction Committee held a telephonic meeting with other members of the board of directors and senior management and representatives of WilmerHale present and representatives of Goldman Sachs present for certain portions. Mr. Shanmugaraj and a representative of Goldman Sachs reviewed the terms of the non-binding indicative offer letter received from Party C and provided their perspective on the risks associated with Party C’s proposal, noting that Party C’s internal process and due diligence efforts were considerably behind those of Parent. The Transaction Committee instructed management to continue exploring a potential transaction with Party C in parallel with its discussions with Parent, including facilitating formal due diligence. The Transaction Committee also authorized management to finalize the terms of and execute an engagement letter with Goldman Sachs on terms consistent with those discussed at the prior meeting, with such changes as deemed appropriate by management.

On June 23, 2019, Mr. Salvagno called Mr. Shanmugaraj and told him that Parent was requesting exclusivity, which it felt was appropriate given the progress to date. Later that day, Mr. Salvagno sent Mr. Shanmugaraj a draft exclusivity agreement, which provided for a 30-day period of exclusivity. Mr. Shanmugaraj responded that he would have to take the matter to the board of directors for further discussion.

On June 24, 2019, the Company provided access to an electronic data room to Parent and Party C to facilitate their due diligence. The June LRP was made available to Parent on June 25, 2019, when it was posted to the electronic data room. Between June 26, 2019 and July 6, 2019, the Company conducted numerous due diligence meetings and teleconferences with both Parent and Party C, including in-person due diligence meetings with Party C on June 26—27, 2019, and with Parent on June 27—29, 2019, in each case at the offices of WilmerHale in Boston.

Also on June 24, 2019, representatives of Goldman Sachs spoke by telephone with Mr. Salvagno and informed him that the Company had received an inbound expression of interest from a third party that was continuing to evaluate the Company, and that the Company could not agree to exclusivity under those circumstances. The representatives of Goldman Sacks noted that the third party had expressed interest at a higher price, but was earlier in its evaluation of the Company, and that the Company would continue to support Parent’s due diligence efforts.

Also on June 24, 2019, Mr. Salvagno spoke by telephone with Mr. Shanmugaraj, who confirmed the receipt of an inbound expression of interest at a higher price and that the Company would continue to support Parent’s due diligence efforts.

On June 25, 2019, the Company executed an engagement letter with Goldman Sachs to serve as the Company’s financial advisor in connection with a potential transaction. Additionally, certain members of senior management of Party C met with Mr. Shanmugaraj and selected members of the Company’s management for dinner in Boston prior to Party C’s in-person diligence meetings on June 26—27, 2019, as noted above.

On June 25 and 26, 2019, the Company entered into Clean Team Confidentiality Agreements with each of Parent and Party C, respectively, providing for additional access and disclosure restrictions on certain competitively sensitive information.

On June 28, 2019, Mr. Shanmugaraj spoke to representatives of Party C by telephone to discuss certain process and timing matters. The representative of Party C indicated that Party C’s counsel was starting on a draft merger

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agreement, to which Mr. Shanmugaraj replied that the Company was already preparing to send a draft merger agreement to Party C in the next 24 – 48 hours.

Later on June 28, 2019, Mr. Shanmugaraj and selected members of the Company management met with selected members of Parent management for dinner in Boston on the second day of the in-person diligence meetings on June 27—29, 2019, as noted above.

On June 29, 2019, WilmerHale delivered a draft merger agreement to counsel to Party C. Despite repeated requests for comments on the draft merger agreement, none were ever provided by or on behalf of Party C.

On June 30, 2019, Mr. Shanmugaraj spoke to a representative of Party C by telephone and to confirm Party C’s anticipated timeline for signing a definitive agreement as outlined in its June 21, 2019 proposal. The representative of Party C suggested that Mr. Shanmugaraj meet with the Chief Executive Officer of Party C to further discuss plans for proceeding to a definitive agreement.

On July 1, 2019, representatives of Goldman Sachs spoke by telephone with representatives of Parent to confirm Parent’s anticipated timeline for executing a definitive agreement. The representatives of Parent indicated that they were anticipating approval from Parent’s board of directors on July 8, 2019, with signing occurring by July 10, 2019, but as early as July 9, 2019.

Also on July 1, 2019, Mr. Shanmugaraj received a text message from the Chief Executive Officer of Party A, indicating that he had heard “rumors” and expressed interest in connecting to discuss a potential strategic transaction with Party A. After consulting with representatives of Goldman Sachs and WilmerHale, Mr. Shanmugaraj replied by text to the Chief Executive Officer of Party A on July 2, 2019 and suggested a meeting during the week of July 8, 2019.

On July 2, 2019, Mr. Shanmugaraj spoke with a representative of Party C by telephone. The representative communicated that Party C was working towards a timeline that would result in the signing of a merger agreement with the Company on July 9, 2019.

Also on July 2, 2019, a representative of Parent sent to the Company initial drafts of proposed employment arrangements for Mr. Shanmugaraj, Mr. Mikkelsen, Mr. Givehchi, and Christian Rasmussen, Founder and Vice President of Digital Signal Processing and Optics of the Company.

On July 3, 2019, Mr. Shanmugaraj and other members of the Company’s senior management met with the Chief Executive Officer of Party C over lunch near Party C’s headquarters. The Chief Executive Officer of Party C indicated that he and other members of senior management were still evaluating the transaction, and given that such a transaction would involve a new business model, would need at least an additional two weeks to finalize its evaluation of, and determine its willingness to proceed with, a transaction. Mr. Shanmugaraj asked if this was just a situation of needing more time to complete confirmatory due diligence, or if more evaluation of the merits and risks of the transaction, due to the nature of the Company’s business model, had to be performed, to which the Chief Executive Officer of Party C responded that additional analysis of the business model and the merits of the transaction needed to be performed. Mr. Shanmugaraj informed the Chief Executive Officer of Party C that the other party was moving very quickly and that a definitive agreement might be signed with the other party the week of July 8, 2019. Mr. Shanmugaraj asked the Chief Executive Officer of Party C if he was willing to risk loss of the transaction through the delay, to which the Chief Executive Officer of Party C responded that he understood the risk and was willing to take it.

On July 3, 2019, a representative of Parent sent a detailed plan to representatives of Goldman Sachs outlining steps to a sign a definitive agreement on July 8, 2019.

On July 4, 2019, representatives of Goldman Sachs spoke by telephone to the Chief Financial Officer of Party C, who conveyed that Party C was still evaluating the business case for a potential transaction with the Company

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and would need at least two more weeks to reach a decision on whether it would proceed with any transaction. The representatives of Goldman Sachs reminded the Chief Financial Officer of Party C that the Company was engaged in discussions with another interested party, and the Chief Financial Officer of Party C acknowledged the risk that the Company could move forward with another transaction within this timeframe.

On July 5, 2019, Mr. Shanmugaraj received a text message from a representative of Party C expressing Party C’s continued interest in pursuing a transaction.

Also on July 5, 2019, the Transaction Committee held a telephonic meeting with other members of the board of directors and senior management and representatives of WilmerHale present and representatives of Goldman Sachs present for certain portions. Mr. Shanmugaraj provided an update on the status of discussions and due diligence with Parent and Party C. Mr. Shanmugaraj noted that Parent was highly engaged and progressing rapidly, whereas Party C was less engaged and falling further behind Parent. Mr. Shanmugaraj noted that Parent had internal management support to pursue the transaction, whereas Party C had communicated that its senior management was still evaluating the merits of the potential transaction and needed more time to make a final determination. Mr. Shanmugaraj then described the text message he had received from the Chief Executive Officer of Party A and his response. A representative of Goldman Sachs next described a conversation between the representative of Goldman Sachs and the Chief Financial Officer of Party C. The representative of Goldman Sachs stated that, in view of Party C’s admission that it was still working to validate the business case for a transaction, the lack of any response to the draft merger agreement, and the additional time required before Party C would finalize its evaluation of the Company’s business model and determine its willingness to proceed with a transaction, there was risk that Party C might not move forward with any transaction with the Company within a reasonable timeframe. Representatives of WilmerHale next provided an update regarding the negotiation of the original merger agreement with Parent, discussing in particular the proposed allocation of the risks associated with regulatory approvals, including terms of an addendum to the existing Master Purchase Agreements with Parent providing for additional purchase commitments by Parent, agreed upon commitments to achieve regulatory approvals and special interim operating covenants that would permit the Company greater flexibility to enter into new, or amendments to existing, supply agreements with customers, and Parent’s commitment to affirm such agreements. Representatives of Goldman Sachs provided an overview of prior discussions with Party A regarding a potential strategic transaction. Representatives of Goldman Sachs then presented an illustrative analysis of a combination with Party A, noting in particular that it would be very difficult for Party A to complete an all-cash transaction at the prices under discussion with Parent and Party C, given Party A’s available cash and the implied leverage required to finance such a transaction, and that a mixed cash and stock transaction would be highly dilutive to Party A’s earnings per share. As a result, representatives of Goldman Sachs expressed skepticism that Party A would be in a position to make a competitive offer. The representatives of Goldman Sachs also noted that any mixed cash and stock transaction with Party A would likely require approval by Party A’s stockholders, which would increase the execution risk of pursuing such a transaction. A representative of WilmerHale then reviewed the fiduciary duties of the board of directors. The Transaction Committee then discussed next steps with the various parties. The representatives of Goldman Sachs expressed concern that Parent might terminate discussions if the Company attempted to delay negotiations in an effort to provide the additional two weeks requested by Party C. Mr. Gavin also noted that there had been very little engagement by Party C or its advisors on due diligence over the last few days, which supported heightened concern that Party C was not committed to a transaction. The Transaction Committee concluded that management and Goldman Sachs should indicate to Parent that the Company had a superior cash offer, but was willing to move forward quickly with Parent if it significantly increased its price to a number “in the $70s” and agreed to a satisfactory resolution of regulatory matters, including a reverse termination fee for failure to close due to failure to obtain regulatory approvals, while continuing to pursue engagement with Party C. The Transaction Committee also decided not to pursue further discussions with Party A at that time.

On July 5, 2019, Mr. Shanmugaraj had a telephone call with Mr. Salvagno and informed him that, because the Company had received a higher offer from another party, Parent would have to increase its offer to a number “in the $70s.” In addition, Mr. Shanmugaraj stated that the board of directors would require a reverse termination fee

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for failure to close due to the failure to obtain regulatory approvals in order to proceed with signing a definitive agreement. Mr. Salvagno replied that he would discuss the matter internally and work to get back with a response quickly.

On July 6, 2019, Mr. Goeckeler called Mr. Shanmugaraj to discuss the message conveyed to Mr. Salvagno. Mr. Shanmugaraj reiterated that, since the Company had a higher offer from another party, Parent had to increase its offer to a number “in the $70s.” Mr. Shanmugaraj also repeated that the board of directors would require a reverse termination fee for failure to close due to the failure to obtain regulatory approvals in order to proceed with signing a definitive agreement. Mr. Goeckeler indicated that he would work internally to come back with an acceptable proposal.

Later on July 6, 2019, Mr. Shanmurgaraj spoke with Mr. Salvagno by telephone. Mr Salvagno informed Mr. Shanmurgaraj that Parent’s board of directors of Directors had approved an offer of $68 per share for the Company. Mr Shanmugaraj responded that the value gap between this offer and the competing offer was still too wide, and that an acceptable offer would also need to include a reverse termination fee, as previously discussed. Later that day, Mr. Salvagno called Mr. Shanmugaraj to indicate that Parent was prepared to increase its proposed price to $70 per share and to pay a reverse termination fee equal to approximately 4% of equity value for failure to close due to the failure to obtain regulatory approvals; provided that the Company agreed to an equivalent amount for its termination fee. He also indicated that this was Parent’s best and final offer, and that Parent needed a response to such offer within 24 hours. Following this call, the Company received a revised written proposal from Mr. Salvagno that Parent was prepared to increase its proposed price to $70 per share and to pay a reverse termination fee equal to approximately 4% of equity value for failure to close due to specified regulatory matters; provided that the Company agreed to an equivalent amount for its termination fee. The proposal indicated that it was Parent’s best and final offer, and was contingent on the Company executing a definitive agreement on July 8, 2019. On July 5, 2019, the closing price for Company common stock on the Nasdaq Global Select Market was $48.14 per share.

On July 7, 2019, the Transaction Committee held a telephonic meeting with other members of the board of directors and senior management and representatives of WilmerHale present and representatives of Goldman Sachs present for certain portions. Mr. Shanmugaraj summarized the discussions with Parent and Party C since the last meeting and the terms of the updated proposal from Parent at $70 per share, noting that the proposal was contingent on executing a definitive agreement on July 8, 2019. Mr. Shanmugaraj and a representative of WilmerHale summarized the agreements reached with Parent regarding commitments to mitigate regulatory risk, including the reverse termination fee in the latest Parent proposal. Representatives of Goldman Sachs and the Transaction Committee also discussed the proposed size of the Company’s termination fee, as well as termination fees in precedent transactions distributed in advance of the meeting. The representatives of Goldman Sachs next presented illustrative preliminary financial analyses of Parent’s latest offer. A representative of Goldman Sachs recommended one more final outreach to Party C to confirm that no formal offer was forthcoming and to advise them that the Company was prepared to move forward promptly with an alternative transaction if that were not the case. Mr. Shanmugaraj then provided an overview of the employment and non-compete arrangements proposed by Parent for certain members of senior management, including himself and Benny Mikkelsen, who was also a member of the board of directors, and it was agreed that a summary of these arrangements would be provided to the board of directors in advance of its next meeting. A representative of WilmerHale then reviewed the fiduciary duties of the board of directors and the application of those duties to the decision of whether to proceed with a transaction with Parent. At the request of the Transaction Committee, each member of management present confirmed his or her view that a transaction with Parent at $70 per share was superior to the prospects of remaining an independent standalone entity. The Transaction Committee instructed Goldman Sachs and management to contact Party C prior to the next board of directors meeting and, absent a definitive commitment from Party C to move forward promptly at a higher price, to finalize the terms of a transaction with Parent.

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On July 7, 2019, Mr. Shanmugaraj spoke to Mr. Salvagno by telephone and conveyed that the board of directors was prepared to proceed based on the latest proposal from Parent. Mr. Shanmugaraj also spoke by telephone with Mr. Goeckeler the same day to convey the board of directors’s support for the proposed transaction.

On July 8, 2019, a representative of Goldman Sachs spoke to the Chief Financial Officer of Party C and inquired if Party C’s perspective or timetable had changed and was informed that it had not. The representative of Goldman Sachs indicated to the Chief Financial Officer of Party C that given the risk associated with Party C and the available alternative, the Company would likely move forward with an alternative transaction. Following this discussion, at the direction of the Company, representatives from Goldman Sachs terminated Party C’s access to the electronic data room.

Later on July 8, 2019, the board of directors held a telephonic meeting, with members of senior management and representatives of Goldman Sachs and WilmerHale present. The representatives of Goldman Sachs reported on its outreach to Party C and the lack of any change in Party C’s position. Representatives of WilmerHale reviewed the fiduciary duties of the board of directors in connection with their consideration and approval of the original merger agreement and presented a summary of the principal terms of the definitive original merger agreement between Parent and the Company previously distributed to the directors. Representatives of Goldman Sachs reviewed financial analyses of the $70 in cash per share of Company common stock to be paid by Parent pursuant to the original merger agreement. Representatives of Goldman Sachs then rendered to the board of directors its oral opinion, subsequently confirmed in writing, to the effect that, as of July 8, 2019, and based upon and subject to the factors and assumptions set forth therein, the $70.00 per share merger consideration to be paid to the holders (other than Parent or any affiliate of Parent) of Company common stock was fair from a financial point of view to such holders. After discussion, the board of directors unanimously voted to approve the original merger agreement and the transactions contemplated thereby, including the merger, to recommend the original merger agreement to the Company’s stockholders and to adopt a forum selection by-law amendment.

Following the board of directors meeting, the Company and Parent executed and delivered the original merger agreement and issued a joint press release on July 9, 2019 announcing the transaction.

During the period following the execution of the original merger agreement until the execution of the amended and restated merger agreement, representatives of the Company frequently communicated, and periodically met, with representatives of Parent regarding integration and regulatory matters and preparations for closing and provided Parent with access to certain books, records and personnel of the Company and its subsidiaries in accordance with the original merger agreement.

The Company filed a preliminary proxy statement on July 26, 2019, a definitive proxy statement on August 7, 2019 and a supplement to the proxy statement on August 28, 2019 in advance of the special meeting of stockholders of the Company held on September 6, 2019, in which the holders of Company common stock voted to approve the adoption of the original merger agreement and, by non-binding, advisory vote, certain compensation arrangements for the Company’s named executive officers in connection with the merger proposed under the original merger agreement. At the special meeting, approximately 99.64% of the votes cast (representing more than 70.3% of all outstanding shares of our stock) approved the adoption of the original merger agreement.

Following the execution of the original merger agreement, the parties prepared and submitted regulatory filings in the jurisdictions in which the parties agreed that regulatory filings may be required.

On September 3, 2019, the Company received regulatory clearance from the Austrian Federal Competition Authority with respect to the merger.

On September 26, 2019, the waiting period under the HSR Act expired with respect to the merger.

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On October 22, 2019, Parent and the Company submitted a merger control notification to the State Administration for Market Regulation in China, referred to as SAMR, which SAMR accepted on December 20, 2019.

On November 11, 2019, the Company received regulatory clearance from the German Federal Cartel Office with respect to the merger.

On June 11, 2020, Parent and the Company withdrew their merger control notification previously submitted to SAMR on October 22, 2019 and accepted by SAMR on December 20, 2019. On June 12, 2020, Parent and the Company refiled their merger control notification with SAMR which SAMR accepted on June 16, 2020.

On July 22, 2020, the Company and Parent issued a joint press release regarding the status of the transaction pending under the original merger agreement, stating that the parties remained actively engaged with SAMR and expected the acquisition to receive regulatory clearance. The press release noted that regulatory clearance from SAMR represented the only remaining closing condition under the original merger agreement, other than customary conditions that were to be satisfied at the time of closing.

On September 15, 2020, Parent submitted to SAMR a final remedy proposal of restrictive conditions regarding the post-closing conduct of the Company’s business in China.

On September 21, 2020, Parent withdrew and refiled its HSR Act notification form to avoid expiration of the original clearance under the HSR Act. The parties later received notice from the FTC that early termination of the waiting period applicable to the refiled notification form had been granted.

On October 23, 2020, Mr. Shanmugaraj and Ms. Asgeirsson spoke by telephone with Mr. Gartner, Mark Chandler, Parent’s Executive Vice President, Chief Legal Officer and Chief Compliance Officer, and Graham Allan, Parent’s Vice President, Legal—Legal Department Operations and M&A Legal, regarding the status of the pending regulatory approval in China. During the call, Mr. Shanmugaraj inquired about Parent’s plans if SAMR approval were not obtained prior to the end date under the original merger agreement. Mr. Chandler replied that Parent remained confident that SAMR approval would be obtained, and the merger closed, before the end date under the original merger agreement.

On November 10 and 11, 2020, the board of directors held a regularly scheduled meeting by teleconference, with members of senior management and representatives of WilmerHale present for portions of the meeting. During the first day of the meeting, among other matters, Janene Asgeirsson, the Company’s Chief Legal Officer and Secretary, reviewed the status of regulatory review in China, noting that it was uncertain whether or not regulatory approval would be obtained prior to the end date under the original merger agreement of January 8, 2021. Next, a representative of WilmerHale discussed the Company’s obligations and rights under the original merger agreement in connection with obtaining or failing to obtain, regulatory approval in China prior to January 8, 2021. On the second day of the meeting, representatives of WilmerHale joined portions of the meeting to answer questions from the board of directors regarding the Company’s obligations and rights under the original merger agreement in connection with obtaining or failing to obtain, regulatory approval in China prior to January 8, 2021.

On November 20, 2020, Mr. Shanmugaraj spoke to Mr. Gartner by telephone on a variety of business matters. During the call, Mr. Shanmugaraj inquired about Parent’s plans if SAMR approval were not obtained prior to the end date under the original merger agreement and noted that the board of directors could expect him to evaluate all of the Company’s options in that scenario. Mr. Gartner replied that Parent remained confident that SAMR approval would be obtained, and the merger closed, before the end date under the original merger agreement.

On December 10, 2020, Parent and the Company withdrew their merger control notification previously submitted to SAMR on June 12, 2020 and accepted by SAMR on June 16, 2020. On the same day, Parent and the Company refiled their merger control notification with SAMR, which SAMR accepted on December 11, 2020.

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On December 11, 2020, the board of directors held a telephonic meeting, with members of senior management and representatives of Goldman Sachs and WilmerHale present. Mr. Shanmugaraj provided a brief update on the status of the merger and then turned the meeting over to Ms. Asgeirsson, who reviewed the status of regulatory review in China, noting that it continued to be uncertain whether or not regulatory approval would be obtained prior to the end date under the original merger agreement of January 8, 2021. The representatives of Goldman Sachs reviewed current market conditions, as well as the financial performance of the Company and certain other optical and semiconductor companies, since the announcement of the original merger agreement. The representatives of Goldman Sachs then left the meeting and a representative of WilmerHale reviewed with the board of directors the potential decisions that could be faced by the board of directors in connection with the approaching end date under the original merger agreement, as well as their fiduciary duties in connection with such potential decisions. Next, Mr. Gavin presented a draft of a new long-range plan, which reflected projected performance of the Company on a stand-alone basis for fiscal years 2020 through 2025 and included updated estimates and assumptions reflecting the Company’s performance through September 30, 2020 and currently anticipated prospects and described how the new long-range plan differed from the June LRP. Following questions and comments from board of directors, it was agreed that management should continue refining the new long-term plan for redistribution to the board of directors.

On December 12, 2020, Ms. Asgeirsson provided a revised draft of the new long-range plan, referred to as the December LRP, to the board of directors by posting it to an electronic board portal. The December LRP was subsequently approved by email by the members of the board of directors.

On December 18, 2020, the board of directors held a telephonic meeting, with members of senior management and representatives of Goldman Sachs and WilmerHale present. Ms. Asgeirsson reviewed the status of regulatory review in China, noting that little had changed since the previous meeting, although Parent’s advisors continued to express optimism that approval would be obtained within the timeframe contemplated by the original merger agreement. A representative of WilmerHale next confirmed that the board of directors had received and reviewed an updated disclosure letter provided by Goldman Sachs, which summarized Goldman Sachs’ relationship with Parent over the last two years, including information regarding compensation for financial advisory and/or underwriting services provided by its Investment Banking Division to Parent and/or its affiliates and the presence of a director on the board of directors of Parent that is currently affiliated with the Goldman Sachs Group, Inc. as a director. Representatives of Goldman Sachs then reviewed an update on market developments and certain illustrative preliminary financial analyses of the Company based, in part, on current market data and the December LRP. The representatives noted that the illustrative preliminary financial analyses reflected the same methodologies as those reviewed by Goldman Sachs with the board of directors in July 2019, except reflected current market developments that the representatives reviewed with the board of directors and did not include any historical stock trading analysis or premia analysis given that the Company common stock had not traded on an unaffected basis since the announcement of the original merger agreement in July 2019. The representatives of Goldman Sachs also reviewed the Company’s current stockholder base, potential changes in the composition of the stockholder base if the original merger agreement were terminated, and the potential impact of such a change on trading in, and the market price of, Company common stock. The representatives of Goldman Sachs then left the meeting. The board of directors next discussed the Company’s ability to operate and prospects as a stand-alone company if the original merger agreement were terminated, including the potential consequences of such termination on the significant customer relationship with Parent and execution risks associated with the December LRP. The board of directors also discussed the possibility of extending the end date under the original merger agreement and determined that such an extension would not be advisable due to the potential consequences of continued uncertainty regarding the status of the merger on the Company’s business and employees. Following further discussion, the board of directors concluded that it would not be in the best interest of the Company’s stockholders to proceed with the transaction at the current price of $70.00 per share under the terms of the original merger agreement if a closing did not occur prior to the end date of January 8, 2021.

On December 31, 2020, Mr. Shanmugaraj spoke to Mr. Gartner by telephone. Mr. Gartner informed Mr. Shanmugaraj that Parent remained optimistic that it would receive regulatory approval in China before

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January 8, 2021, but inquired whether the Company would consider a waiver of the applicable condition in the event such approval were not received. Mr. Shanmugaraj said that any such waiver was a decision for the board of directors and that he would bring it to the board of directors if he were more formally requested to do so by Parent in a written communication, noting that he personally would not recommend to the board of directors an extension of the end date under the original merger agreement as an alternative to the waiver due to the potential consequences of continued uncertainty regarding the status of the merger on the Company’s business and employees. Shortly thereafter, Mr. Gartner sent an email to Mr. Shanmugaraj communicating Parent’s request that the Company agree with Parent to execute such waiver. Later on December 31, 2020, Ms. Asgeirsson sent an email to representatives of Parent, confirming that the email from Mr. Gartner to Mr. Shanmugaraj earlier that day was sufficient to allow the Company to bring Parent’s request to the board of directors.

On January 1, 2021, in anticipation of receiving SAMR approval based on the September 15, 2020 proposal of restrictive conditions, and given the uncertainty of the precise timing (including as a result of time zone differences) and form of such approval, in light of the approaching end date under the original merger agreement, Mr. Allan delivered to the Company by email a waiver to facilitate the expeditious closing of the merger by providing that all applicable conditions to the closing would be satisfied or waived on the day prior to the end date under the original merger agreement. The email requested that the Company provide a similar waiver in a form attached to the email.

On January 3, 2021, the board of directors held a telephonic meeting, with members of senior management and representatives of Goldman Sachs and WilmerHale present. Mr. Shanmugaraj reported on discussions with Parent regarding Parent’s request that the Company waive the conditions to closing in the original merger agreement related to regulatory approval in China. A representative of WilmerHale next described the content and implications of the waiver delivered by Parent on January 1, 2021, including that the delivery of the waiver meant that the reverse termination fee under the Addendum to the Supply Agreement would no longer be payable by Parent if Parent or the Company terminated the original merger agreement on or after the end date under the original merger agreement. The representative of WilmerHale also reviewed the fiduciary duties of the board of directors in determining how to respond to Parent’s request. Representatives of Goldman Sachs next reviewed certain illustrative preliminary financial analyses of the Company. After further discussion, the board of directors concluded that the merger consideration under the original merger agreement of $70.00 per share no longer reflected an appropriate valuation for the Company and, in the event SAMR approval was not obtained prior to January 8, 2021, it would be in the best interest of the Company’s stockholders to terminate the original merger agreement and remain an independent, publicly traded company unless a higher price could be negotiated with Parent. The board of directors next discussed potential responses to Parent. A representative of WilmerHale described structural options for increasing the value paid to stockholders, as well as the steps required to renegotiate the terms of the transaction. After further discussion of the alternatives available to the Company, the board of directors instructed management to inform Parent that, if SAMR approval were not obtained prior to January 8, 2021, the Company was not prepared to waive the conditions to closing in the original merger agreement related to regulatory approval in China in order to close the merger upon the original terms. Instead, the Company was prepared to (i) terminate the original merger agreement on January 8, 2021 if SAMR approval was not obtained and negotiate an expanded partnership to deepen the customer/supplier relationship between the parties or (ii) renegotiate the deal terms to reflect the increase in the value of the Company since the announcement of the original merger agreement. The board of directors also determined that it was not prepared to make a determination of what an acceptable value for the Company might be at that time and that the Company should not propose a price. Finally, the board of directors discussed the potential for events to proceed rapidly, given the proximity of the end date under the original merger agreement, and concluded that it would be desirable to reconstitute the Transaction Committee to allow for flexible and timely support of management under circumstances when it might not be practical to assemble the full board of directors. The board of directors then reestablished the Transaction Committee, consisting of directors David Aldrich, Peter Chung, Stan Reiss and John Ritchie.

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On January 4, 2021, Mr. Shanmugaraj spoke to Mr. Gartner by telephone. Mr. Shanmugaraj informed Mr. Gartner that the Company believed the current price of $70.00 per share undervalued the Company due to the Company’s performance and market developments since the execution of the original merger agreement, and that, as a result, the Company was not able to grant Parent’s request for a waiver and would not extend the end date under the original merger agreement. Mr. Shanmugaraj then described two alternative paths that the Company was willing to pursue, including (i) terminating the original merger agreement on January 8, 2021 if SAMR approval was not obtained and negotiating an expanded partnership to deepen the customer/supplier relationship between the parties and (ii) renegotiating the deal terms to reflect the increase in the value of the Company since the announcement of the original merger agreement. Mr. Shanmugaraj also noted that the Company understood its obligations to proceed to a closing under the terms of the original merger agreement if SAMR approval were received prior to January 8, 2021. Mr. Gartner suggested that Mr. Shanmugaraj discuss the matter further with Derek Idemoto, Parent’s Senior Vice President of Corporate Development, who would reach out to Mr. Shanmugaraj. After the call between Mr. Shanmugaraj and Mr. Gartner, Mr. Idemoto sent a text to Mr. Shanmugaraj proposing a call the following day.

On January 5, 2021, Mr. Shanmugaraj spoke to Mr. Idemoto by telephone and reiterated the Company’s position as he had described to Mr. Gartner the previous day. Mr. Idemoto then asked Mr. Shanmugaraj for a price proposal. Mr. Shanmugaraj declined to propose a price, but offered to connect Mr. Idemoto to representatives of Goldman Sachs, who could provide market data on the Company’s peers and comparable transactions that would inform the Company’s perspective on price. Mr. Idemoto said he would consider the matter and follow up with Mr. Shanmugaraj.

On January 5, 2021, the Transaction Committee held a telephonic meeting, with members of the board of directors, members of senior management and representatives of Goldman Sachs and WilmerHale present. Mr. Shanmugaraj opened the meeting by describing his calls with Mr. Gartner and Mr. Idemoto. Next, a representative of WilmerHale described structural options for delivering additional value to the Company’s stockholders if Parent were willing to renegotiate. During the meeting, Mr. Idemoto contacted Mr. Shanmugaraj by text, indicating that Parent would be connecting with Goldman Sachs that same day and expressing interest in receiving updated financial forecasts for the Company. After further discussion of potential approaches for engaging with representatives of Parent, consistent with the prior determination of the board of directors, the Transaction Committee directed management and the representatives of Goldman Sachs to advise Parent that any renegotiation of terms should be initiated by a price proposal by Parent, and not the Company.

Later on January 5, 2021, the Company provided the December LRP to Parent by email.

Later on January 5, 2021, representatives of Goldman Sachs spoke by telephone with representatives of Parent. The representatives of Goldman Sachs reviewed significant changes in the relevant markets and precedent transactions since July 2019. At the direction of the board of directors, the representatives of Goldman Sachs also stated that the Company was prepared to terminate the original merger agreement on January 8, 2021 if SAMR approval had not been obtained prior to such date, and was not willing to extend the timeframe for termination at the current price. The representatives of Goldman Sachs also noted that the Company was willing to entertain negotiations to close after January 8, 2021 if Parent made a proposal at a higher price. Parent requested price guidance, but the representatives of Goldman Sachs declined, citing the prior direction of the board of directors.

Later on January 5, 2021, representatives of the Company’s management spoke by telephone with representatives of Parent to discuss the assumptions underlying the December LRP. The Company continued to respond to information requests regarding the December LRP through January 7, 2021.

On January 6, 2021, the Transaction Committee held a telephonic meeting, with members of the board of directors, members of senior management and representatives of Goldman Sachs and WilmerHale present. Mr. Shanmugaraj provided a status update, noting that the December LRP had been provided to Parent, but Parent had not yet proposed a price increase. Representatives of Goldman Sachs next described their call with

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Parent the previous day. Mr. Shanmugaraj noted that discussions with Parent regarding the December LRP were ongoing, and he expected that further updates would be available later that day.

Later on January 6, 2021, Mr. Shanmugaraj spoke to Mr. Idemoto by telephone. Mr. Idemoto informed Mr. Shanmugaraj that, if SAMR approval were not obtained prior to the end date under the original merger agreement, Parent was willing to enter into an amendment to the original merger agreement to increase the price to $83.00 per share. Mr. Idemoto noted that Fenwick was preparing a draft amendment to the original merger agreement, which would be provided to the Company later that day. Mr. Shanmugaraj characterized the $83.00 per share price as a “non-starter” given the market developments and Company performance since July 2019, and Mr. Idemoto asked for guidance on a price that would be acceptable. Mr. Shanmugaraj said that he would discuss the matter with the board of directors, but he was not sure whether the board of directors would be willing to provide a counter offer to such a low price.

Later on January 6, 2021, the board of directors held a telephonic meeting, with members of senior management and representatives of Goldman Sachs and WilmerHale present. Mr. Shanmugaraj reported on his discussion with Mr. Idemoto, including the $83.00 per share price proposed on the call and Mr. Shanmugaraj’s response. The board of directors observed that the proposed price was well below the level at which the Company would be prepared to consider a modified transaction and discussed potential responses to the $83.00 per share price proposal with its advisors. A representative of Goldman Sachs noted that it would be difficult to counter and negotiate with such a wide valuation gap, and suggested that the Company consider rejecting the proposal without a counteroffer to see if Parent was willing to increase its price further. The representatives of Goldman Sachs then left the meeting, and the board of directors discussed the illustrative preliminary financial analyses reviewed by Goldman Sachs at the January 3, 2021 meeting and the directors’ perspectives on value. Following further discussion, the board of directors instructed management to inform Parent that its offer was too low to warrant further engagement.

Later on January 6, 2021, Fenwick sent a draft of the amended and restated merger agreement to WilmerHale, along with a draft of a new form of voting agreement.

Later on January 6, 2021, Mr. Shanmugaraj spoke to Mr. Idemoto by telephone and informed him that the $83.00 per share price proposed by Parent was too low to justify further discussion and that Parent would need to raise its price before the Company engaged. Mr. Idemoto asked whether the Company would be looking for a value approaching “triple digits” and stated that, although he was not authorized to offer above $83.00 per share, he wanted to understand the Company’s expectations. Mr. Shanmugaraj declined to engage in price discussions, consistent with the prior instructions of the board of directors, but confirmed that the Company’s value expectations were “well into the triple digits.” Mr. Idemoto then asked if the Company’s desired price was as high as $105.00 per share, noting again that he was not authorized to offer that number, but needed a better sense of the Company’s expectations. Mr. Shanmugaraj responded that he did not think that such price would get a deal done at this time, but that he would bring any proposal to the board of directors.

On the morning of January 7, 2021, the Transaction Committee held a telephonic meeting, with other members of the board of directors, members of senior management and representatives of Goldman Sachs and WilmerHale present. Mr. Shanmugaraj reported on his discussion with Mr. Idemoto, including Mr. Idemoto’s statement that he did not have authority to offer a price in excess of the prior offer, but was instead trying to gather information on the Company’s price expectations. Mr. Shanmugaraj noted that Parent had not contacted the Company or its advisors since that call, and that the Transaction Committee should consider providing a price proposal to Parent if they continued to remain silent due to the limited time remaining before the end date under the original merger agreement. The Transaction Committee decided that it should reconvene later that day and to determine a price proposal if Parent had not responded with an updated proposal in the interim. The Transaction Committee then recessed the meeting until later that day.

Later on January 7, 2021, the Transaction Committee reconvened by telephone with other members of the board of directors, members of senior management and representatives of Goldman Sachs and WilmerHale present.

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Mr. Shanmugaraj reported that Parent had not contacted the Company or its advisors since the meeting had been recessed earlier that day and suggested that, given the limited time remaining before the original merger agreement became terminable, the Company should make a price proposal to Parent. After further discussion, the Transaction Committee concluded that the Company should propose a price of $115.00 per share, noting that the Company should also communicate to Parent that this proposal would expire at 5:00 p.m. Eastern time if Parent and the Company had not agreed to proceed at a mutually acceptable price by that time, since shortly thereafter it would be the opening of business in China and the Company would be at risk that SAMR might approve the transaction during its business day and the Company would be required to proceed to a closing under the terms of the original merger agreement.

Later on January 7, 2021, Mr. Shanmugaraj spoke to Mr. Idemoto by telephone and informed him that the Company was prepared to recommend to the board of directors proceeding to a closing at price per share of $115.00, but only if Parent agreed to promptly engage and get to a negotiated deal by 5:00 p.m. Eastern time. Mr. Idemoto told Mr. Shanmugaraj that he would follow up with Parent’s response.

Later on January 7, 2021, at the direction of the Company, a representative of WilmerHale sent a proposed form of letter agreement to Fenwick that contemplated closing the merger at the original $70.00 per share price under the original merger agreement, but permitting the Company to declare a cash dividend to Company stockholders as of immediately prior to the closing in order to increase the overall consideration payable to such stockholders to achieve the Company’s proposed price, which dividend would be payable contingent upon such closing.

Later on January 7, 2021, Mr. Shanmugaraj received a text from Mr. Idemoto shortly before 5:00 p.m. Eastern time stating that Parent was not in a position to have a price conversation at that time.

Later on January 7, 2021, the board of directors held a telephonic meeting, with members of senior management and representatives of Goldman Sachs and WilmerHale present. Mr. Shanmugaraj reported on his call with Mr. Idemoto and the text he received in response, noting that the text was the only response he had received prior to the 5:00 p.m. Eastern time deadline communicated on the call. The board of directors discussed the potential implications of this response with its advisors, and determined that the Company should be prepared for the possibility that Parent would not reengage at the proposed price or any other acceptable price, and that the Company should be prepared to terminate the original merger agreement if Parent was not willing to reengage within an acceptable price range and SAMR approval was not received by the end of the day. A representative of WilmerHale noted that if Parent and the Company were able to agree on a price before the end of the day, it would be possible to enter into a letter agreement that could delay the termination of the original merger agreement long enough to allow for negotiation of definitive documentation without putting the Company at risk of being forced to close at the original price of $70.00 per share if SAMR were to approve the transaction before the delayed termination of the original merger agreement. After further discussion, the board of directors authorized the Company’s management to terminate the original merger agreement as early as possible on January 8, 2021 if SAMR approval had not been obtained and the parties had not reached an agreement on price by the end of the day on January 7, 2021. Mr. Shanmugaraj proposed that the board of directors plan to reconvene later that day in case the Company received any further communications from Parent. The board of directors then recessed the meeting until later that day.

Later on January 7, 2021, the board of directors reconvened by telephone with members of senior management and representatives of Goldman Sachs and WilmerHale present. Mr. Shanmugaraj informed the board of directors that Parent had not contacted the Company or its advisors since the meeting had been recessed earlier that day. A representative of WilmerHale described a form of extension letter that could be used if Parent was willing to negotiate within an acceptable price range, but was unable to complete definitive documentation before the end date under the original merger. Under the proposed form of extension letter, the parties would mutually agree not to require closing to occur prior to 12:01 a.m. Eastern time on January 11, 2021 and that the original merger agreement would automatically terminate immediately prior to such time if the parties had not previously entered into an amendment to the original merger agreement providing for a specified increase in the merger

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consideration. The board of directors authorized the Company’s management to execute the extension letter if the parties reached an agreement on price.

Also on January 7, 2021, a representative of Parent received by email a notification from a SAMR representative stating that SAMR “have determined that the proposal of restrictive conditions which [Parent] submitted on September 15th is sufficient to address the relevant competition concerns.” Fenwick delivered this notification to the Company by email on behalf of Parent and conveyed Parent’s position that the notification of such determination confirmed that the antitrust approval condition had been satisfied and that the Company was required by the original merger agreement to proceed with the closing immediately.

Shortly thereafter, Fenwick sent a second email stating that, if the Company did not promptly proceed with closing, Parent would seek emergency relief in the Court of Chancery of the State of Delaware, referred to as the Court of Chancery, including to enjoin or invalidate any attempted termination of the original merger agreement.

Following receipt of the first Fenwick email, the Company consulted with its regulatory counsel in China and concluded that the email from the SAMR representative attached to the Fenwick email was not sufficient evidence of an official approval by SAMR. Ms. Asgeirsson then responded to Fenwick and Parent that the Company did not believe that the notification represented formal approval by SAMR and therefore the closing condition relating to antitrust approval in China had not been satisfied. At the direction of the Company, WilmerHale subsequently delivered to Parent a notice of termination of the original merger agreement based on the failure to satisfy all closing conditions prior to the end date.

On January 8, 2021, shortly after delivery of the termination notice, the board of directors held a telephonic meeting, with members of senior management and representatives of WilmerHale and Potter Anderson & Corroon, the Company’s special Delaware counsel, present. Mr. Shanmugaraj and Ms. Asgeirsson reviewed the events preceding the decision to deliver the notice of termination. After further discussion, the board of directors ratified the decision to terminate the original merger agreement.

Later on January 8, 2021, Parent filed a complaint in the Court of Chancery seeking a temporary restraining order enjoining the Company’s purported termination of the original merger agreement. Parent also sought an expedited trial to resolve Parent’s request for a declaratory judgment that all necessary conditions to closing were satisfied prior to the end date under the original merger agreement and the Company’s termination of the original merger agreement was invalid, and an order requiring the Company to close the merger pursuant to the original merger agreement.

Later on January 8, 2021, the Court of Chancery held a hearing and granted Parent’s request for a temporary restraining order, enjoining the Company’s purported termination of the original merger agreement. The Court of Chancery also granted Parent’s motion for expedited proceedings for consideration of Parent’s claims. Pursuant to the temporary restraining order, the Company remained bound by the terms of the original merger agreement pending resolution of the matters before the Court of Chancery, unless otherwise agreed by the parties.

On January 11, 2021, the Company filed its answer and affirmative defenses in response to the complaint filed by Parent in the Court of Chancery and simultaneously filed a counterclaim against Parent seeking a declaration that the Company validly terminated the original merger agreement.

Overnight between January 12 and 13, 2021, each of Parent and the Company received by email a notification from SAMR, dated January 9, 2021, stating that “upon preliminary review, it is hereby decided to conduct further review” of the merger, which notification cast substantial doubt on the conclusiveness of the notification from SAMR received by Parent on January 7, 2021. In light of the continuing uncertain state of antitrust approval in China, and the continuing desire of Parent and the Company to consummate the merger and to resolve the inherent uncertainty related to the litigation between the parties regarding the Company’s purported termination of the merger agreement and whether the antitrust approval condition had been satisfied prior to the end date,

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following receipt of SAMR’s January 12-13, 2021 notification and into the early morning of January 14, 2021, representatives of Parent and the Company continued discussions of the terms pursuant to which the original merger agreement could be amended and the merger could be effected.

On January 13, 2021, Mr. Shanmugaraj received a text message from Chuck Robbins, the Chief Executive Officer and Chairman of Parent, proposing a telephone conversation between Mr. Shanmugaraj and Mr. Robbins.

Later on January 13, 2021, the board of directors held a telephonic meeting, with members of senior management and representatives of Goldman Sachs and WilmerHale present. Mr. Shanmugaraj and Ms. Asgeirsson informed the board of directors of the recent notice from SAMR and reported on the status of discussions between representatives of Parent and the Company and the text from Mr. Robbins. Mr. Shanmugaraj noted that he was not sure what Mr. Robbins’ response would be, but said that he felt the board of directors should reach a consensus on value in case Mr. Robbins was prepared to discuss an increase in merger consideration. Representatives of Goldman Sachs observed that recent trading prices for Company common stock had exceeded $85.00 per share, even with the uncertainty of the existing litigation in the Court of Chancery. After further discussion, the board of directors authorized Mr. Shanmugaraj to propose $115.00 per share, but noted that Mr. Shanmugaraj should remain firm at that price and communicate the Company’s desire for terms that would deliver closing certainty. The board of directors then recessed the meeting until later that day.

Later on January 13, 2021, Mr. Shanmugaraj spoke to Mr. Robbins by telephone, and Mr. Robbins indicated that Parent was prepared to engage in price negotiations. Mr. Shanmugaraj informed him that the Company would be prepared to proceed with a transaction at a price of $115.00 per share, but only if the agreement eliminated any material conditionality beyond stockholder approval. Mr. Robbins responded that he would need time to consult with members of Parent’s board, and proposed that they speak again the next morning at which time he would deliver Parent’s response. Mr. Shanmugaraj agreed and scheduled a call with Mr. Robbins the following morning. Mr. Shanmugaraj also indicated to Mr. Robbins that the Company would send proposed revisions to the form of amended and restated merger agreement previously received from Fenwick in order to advance the drafting in parallel in the interest of time.

Later on January 13, 2021, the board of directors reconvened by telephone with members of senior management and representatives of Goldman Sachs and WilmerHale present. Mr. Shanmugaraj reported on his conversation with Mr. Robbins, noting that he was scheduled to speak to Mr. Robbins the following morning and suggesting that the board of directors plan to reconvene shortly after that call. A representative of WilmerHale reviewed the two structures that the parties had proposed during the previous price discussions. WilmerHale noted that there was likely a limited window of time to negotiate before the Company would be compelled to take steps in the litigation that could make negotiating and completing the transaction more difficult, and that adopting Parent’s preferred structure (amending and restating the original merger agreement) would make it more likely that an agreement could be reached before that window closed. The board of directors agreed to reconvene the following morning after Mr. Shanmugaraj’s next call with Mr. Robbins and directed WilmerHale to deliver a draft amended and restated merger agreement to Fenwick so that the parties could advance discussions regarding structure and terms in the interim.

Later on January 13, 2021, at the direction of the Company, WilmerHale sent revised drafts of the amended and restated merger agreement and the new form of voting agreement to Fenwick, which each reflected comments to the drafts sent by Fenwick on January 6, 2021. From January 13, 2021 until the execution of the amended and restated merger agreement on January 14, 2021, the parties and their respective legal advisors exchanged several drafts of, and engaged in multiple discussions and negotiations concerning the terms of, the amended and restated merger agreement. Significant areas of discussion and negotiation included, among others, the conditions to closing the merger and the amount of the Company’s termination fee. The form of voting agreement proposed by WilmerHale was accepted without further discussion.

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On January 14, 2021, Mr. Shanmugaraj spoke to Mr. Robbins by telephone. Mr. Robbins informed Mr. Shanmugaraj that Parent was prepared to enter into the amended and restated merger agreement at a price of $115.00 in cash per share of Company common stock.

On January 14, 2021, the board of directors held a telephonic meeting, with members of senior management and representatives of Goldman Sachs and WilmerHale present. Mr. Shanmugaraj reported on his conversation with Mr. Robbins in which Mr. Robbins confirmed that Parent was willing to increase its price to $115.00 in cash per share of Company common stock. Representatives of WilmerHale reviewed the terms of the definitive amended and restated merger agreement between Parent and the Company as previously distributed to the directors. Representatives of Goldman Sachs reviewed financial analyses of the $115.00 in cash per share of Company common stock to be paid by Parent pursuant to the amended and restated merger agreement. Representatives of Goldman Sachs then rendered to the board of directors its oral opinion, subsequently confirmed in writing, to the effect that, as of January 14, 2021, and based upon and subject to the factors and assumptions set forth therein, the $115.00 per share merger consideration to be paid to the holders (other than Parent or any affiliate of Parent) of Company common stock was fair from a financial point of view to such holders. (See “The Merger — Opinions of the Company’s Financial Advisors.”) After discussion, the board of directors unanimously voted to approve the amended and restated merger agreement and the transactions contemplated thereby, including the merger and to recommend that the Company’s stockholders adopt the amended and restated merger agreement.

On January 14, 2021, following the board of directors meeting, Parent, merger sub and the Company executed the amended and restated merger agreement and publicly announced such execution shortly before the opening of the Nasdaq stock market on January 14, 2021. Later that same day, Parent and the Company filed with the Court of Chancery a joint stipulation and proposed order asking the court to lift the temporary restraining order previously issued and dismiss with prejudice all claims asserted by the parties in the litigation. Later on January 14, 2021, the Court of Chancery entered the parties’ proposed order vacating the temporary restraining order and dismissing the parties’ respective claims with prejudice.

On January 19, 2021, SAMR published its approval, which approval was dated effective January 14, 2021 and conditioned on the restrictive conditions submitted to SAMR on September  15, 2020.

Reasons for the Merger; Recommendation of the Board of Directors

At a meeting held on January 14, 2021, the board of directors, by a unanimous vote of all of its directors, (a) determined and declared that the amended and restated merger agreement, the merger and the other transactions contemplated by the amended and restated merger agreement, on the terms and subject to the conditions set forth therein, are advisable, fair to and in the best interests of the Company and its stockholders, (b) adopted and approved the amended and restated merger agreement, the merger and the other transactions contemplated by the amended and restated merger agreement and (c) determined that it is advisable and in the best interests of the Company for the board of directors to submit the amended and restated merger agreement to the Company’s stockholders for adoption and directed that the amended and restated merger agreement be submitted to the Company’s stockholders at a special meeting of the Company’s stockholders for their adoption, and recommended that the Company’s stockholders adopt the amended and restated merger agreement.

Before making its recommendation, the board of directors consulted with its outside legal and financial advisors and with the Company’s senior management team. In reaching its recommendation, the board of directors considered the following material factors that it believes support its decision to enter into the amended and restated merger agreement and consummate the merger (which factors are not necessarily presented in order of relative importance):

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The board of directors also weighed the factors described above against the following factors and risks that generally weighed against entering into the amended and restated merger agreement (which factors and risks are not necessarily presented in order of relative importance):

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In considering the recommendation of the board of directors with respect to the proposal to adopt the amended and restated merger agreement, you should be aware that the Company’s directors and executive officers may have interests in the merger that are different from, or in addition to, yours. The board of directors was aware of and considered these interests, among other matters, in evaluating and negotiating the amended and restated merger agreement and the merger, and in their recommendations with respect to the amended and restated merger agreement. See the section entitled “The Merger — Interests of Certain Persons in the Merger” beginning on page [—].

The foregoing discussion of the information and factors considered by the board of directors in reaching its conclusions and recommendations is not intended to be exhaustive, but includes the material factors considered by the directors. In view of the wide variety of factors considered in connection with its evaluation of the merger and the complexity of these matters, the board of directors did not find it practicable to, and did not attempt, to quantify, rank or assign any relative or specific weights to the various factors considered in reaching its determination and making its recommendation. In addition, individual directors may have given different weights to different factors. The board of directors considered all of the foregoing factors as a whole and based its recommendation on the totality of the information presented.

The board of directors recommends that you vote “FOR” approval of the proposal to adopt the amended and restated merger agreement, “FOR” approval of the nonbinding advisory proposal regarding compensation that may be payable to our named executive officers in connection with the merger and “FOR” approval of the proposal to adjourn the special meeting, if necessary or appropriate, to solicit additional proxies.

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Opinion of the Company’s Financial Advisor

Goldman Sachs rendered its opinion to the board of directors that, as of January 14, 2021 and based upon and subject to the factors and assumptions set forth therein, the $115.00 in cash per share to be paid to the holders (other than Parent and its affiliates) of shares of Company common stock pursuant to the amended and restated merger agreement was fair from a financial point of view to such holders.

The full text of the written opinion of Goldman Sachs, dated January 14, 2021, which sets forth assumptions made, procedures followed, matters considered and limitations on the review undertaken in connection with the opinion, is attached as Annex B. Goldman Sachs provided advisory services and its opinion for the information and assistance of the board of directors in connection with its consideration of the merger. The Goldman Sachs opinion is not a recommendation as to how any holder of Company common stock should vote with respect to the merger, or any other matter.

In connection with rendering the opinion described above and performing its related financial analyses, Goldman Sachs reviewed, among other things:

Goldman Sachs also held discussions with members of the senior management of the Company regarding their assessment of the past and current business operations, financial condition, and future prospects of the Company; reviewed the reported price and trading activity for the Company common stock; compared certain financial and stock market information for the Company with similar information for certain other companies the securities of which are publicly traded; reviewed the financial terms of certain recent business combinations in the communication technology and semiconductor industries and in other industries; and performed such other studies and analyses, and considered such other factors, as it deemed appropriate.

For purposes of rendering its opinion, Goldman Sachs, with the Company’s consent, relied upon and assumed the accuracy and completeness of all of the financial, legal, regulatory, tax, accounting and other information provided to, discussed with or reviewed by, it, without assuming any responsibility for independent verification thereof. In that regard, Goldman Sachs assumed with the Company’s consent that the Forecasts were reasonably prepared on a basis reflecting the best currently available estimates and judgments of the management of the Company. Goldman Sachs did not make an independent evaluation or appraisal of the assets and liabilities (including any contingent, derivative or other off-balance-sheet assets and liabilities) of the Company or any of its subsidiaries and it was not furnished with any such evaluation or appraisal. Goldman Sachs assumed that all governmental, regulatory or other consents and approvals necessary for the consummation of the merger will be obtained without any adverse effect on the expected benefits of the merger in any way meaningful to its analysis. Goldman Sachs has also assumed that the merger will be consummated on the terms set forth in the amended and restated merger agreement, without the waiver or modification of any term or condition the effect of which would be in any way meaningful to its analysis.

Goldman Sachs’ opinion does not address the underlying business decision of the Company to engage in the transaction or the relative merits of the transaction as compared to any strategic alternatives that may be available

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to the Company; including an expression of interest for a transaction proposed by a third party that may have resulted in a higher price per share in cash than in the merger, which the Company advised Goldman Sachs, the Company determined not to further pursue because of risks and uncertainties concerning such potential transaction, nor does it address any legal, regulatory, tax or accounting matters. Goldman Sachs’ opinion addresses only the fairness from a financial point of view, to the holders (other than Parent and its affiliates) of shares of Company common stock, as of the date of Goldman Sachs’ opinion, of the $115.00 in cash per share to be paid to such holders pursuant to the amended and restated merger agreement. Goldman Sachs’ opinion does not express any view on, and does not address, any other term or aspect of the amended and restated merger agreement or the merger or any term or aspect of any other agreement or instrument contemplated by the amended and restated merger agreement or entered into or amended in connection with the merger, including the fairness of the merger to, or any consideration received in connection therewith by, the holders of any other class of securities, creditors, or other constituencies of the Company; nor as to the fairness of the amount or nature of any compensation to be paid or payable to any of the officers, directors or employees of the Company, or class of such persons, in connection with the merger, whether relative to the $115.00 in cash per share to be paid to the holders (other than Parent and its affiliates) of shares of Company common stock pursuant to the amended and restated merger agreement or otherwise. Goldman Sachs did not express any opinion as to the prices at which shares of Company common stock will trade at any time, the potential effects of volatility in the credit, financial and stock markets on the Company, Parent or the merger, or the impact of the merger on the solvency or viability of the Company or Parent or the ability of the Company or Parent to pay their respective obligations when they come due. Goldman Sachs’ opinion was necessarily based on economic, monetary market and other conditions, as in effect on, and the information made available to it as of the date of the opinion and Goldman Sachs assumed no responsibility for updating, revising or reaffirming its opinion based on circumstances, developments or events occurring after the date of its opinion. Goldman Sachs’ opinion was approved by a fairness committee of Goldman Sachs.

The following is a summary of the material financial analyses delivered by Goldman Sachs to the board of directors in connection with rendering the opinion described above. The following summary, however, does not purport to be a complete description of the financial analyses performed by Goldman Sachs, nor does the order of analyses described represent relative importance or weight given to those analyses by Goldman Sachs. Some of the summaries of the financial analyses include information presented in tabular format. The tables must be read together with the full text of each summary and are alone not a complete description of Goldman Sachs’ financial analyses. Except as otherwise noted, the following quantitative information, to the extent that it is based on market data, is based on market data as it existed on or before January 12, 2021, the second-to-last completed trading day before the date of Goldman Sachs’ opinion, and is not necessarily indicative of current market conditions.

Historical Stock Trading Analysis

Goldman Sachs reviewed the historical trading prices and volumes for the Company common stock for the 52-week period ended January 12, 2021, the second-to-last completed trading day before the date of Goldman Sachs’ opinion. In addition, Goldman Sachs analyzed the $115.00 in cash per share of the Company’s common stock to be paid to the holders of the Company’s common stock pursuant to the amended and restated merger agreement in relation to (i) the volume weighted average price (the “VWAP”) per share of Company common stock during each of the one-month, three-month, six-month and one-year periods, each ended January 12, 2021, (ii) the highest closing price per share of Company common stock for the 52-week period ended January 12, 2021 and (iii) the lowest closing price per share of Company common stock for the 52-week period ended January 12, 2021.

This analysis indicated that the price per share to be paid to the holders of the Company’s common stock pursuant to the amended and restated merger agreement represented:

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Selected Companies Analysis

Goldman Sachs reviewed and compared certain financial information for the Company to corresponding financial information, ratios and public market multiples for the following publicly traded corporations in the optical and semiconductor industries, which we refer to as the selected companies:

Optical Industry:

Semiconductor Industry:

Although none of the selected companies is directly comparable to the Company, the companies included were chosen because they are publicly traded companies with operations that for purposes of analysis may be considered similar to certain operations of the Company.

Goldman Sachs calculated and compared various financial multiples and ratios for the Company and the selected companies based on financial and trading data as of January 12, 2021 (except for Inphi Corporation, which was as of October 28, 2020, the last day prior to the announcement of its acquisition by Marvell Technology Group Ltd.), information it obtained from SEC filings, the Institutional Brokers’ Estimate System consensus estimates, S&P Capital IQ, Bloomberg, and, for the Company, also the Forecasts. With respect to the selected companies, Goldman Sachs calculated the average multiples of such company’s estimated future earnings before interest, tax depreciation and amortization (which we refer to as “EBITDA”) and its assumed next 12-month enterprise value to EBITDA multiple (which we refer to as “NTM EV/EBITDA”) over certain time periods ending January 12, 2021. The results of these analyses are summarized as follows:

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Goldman Sachs also calculated the average multiples of such company’s estimated future earnings per share (which we refer to as “EPS”) and its assumed next 12-month price to future earnings per share multiple (which we refer to as “NTM P/E”) over certain time periods ending January 12, 2021 for the selected companies. The results of these analyses are summarized as follows:

Illustrative Present Value of Future Share Price Analysis

Goldman Sachs performed an illustrative analysis of the implied present value of the future value per share of Company common stock, which is designed to provide an indication of the present value of a theoretical future value of a company’s equity as a function of (1) such company’s NTM EV/EBITDA, and (2) such company’s NTM P/E. For this analysis, Goldman Sachs used the Forecasts for each of the fiscal years 2020 through 2023 to calculate a range of implied present values per share of Company common stock as of December 31, 2020. Goldman Sachs first calculated illustrative implied future equity values per share of Company common stock as of December 31, 2020 by applying NTM EV/EBITDA multiples ranging from 16.0x to 20.0x to estimated adjusted earnings before interest expense, income taxes, depreciation and amortization (which is referred to in this section as “Adjusted EBITDA”) for each of the fiscal years 2021 to 2023. These illustrative multiple estimates were derived by Goldman Sachs utilizing its professional judgment and experience, taking into account, among other things, current and historical NTM EV/EBITDA multiples for common stock during the two-year period ended January 12, 2021 for the Company and the selected companies which, for the purpose of analysis, may be considered similar to certain operations of the Company and which are summarized above. Goldman Sachs then subtracted estimated net debt for each of the fiscal years 2020 to 2022, as provided by management of the Company, as of the relevant year-end per the Forecasts, from the respective implied enterprise values in order to derive a range of illustrative equity values for the Company for each of the fiscal years 2020 to 2022. Goldman Sachs then divided the results by the applicable projected year-end fully diluted shares outstanding for the Company’s common stock, as reflected in the Forecasts, 44.7 million for 2020, 45.1 million for 2021 and 45.3 million for 2022, to derive a range of implied future share prices. These implied per share values were then discounted back to December 31, 2020, using an illustrative discount rate of 8.5%, reflecting an estimate of the Company’s cost of equity. Goldman Sachs derived this discount rate by applying the Capital Asset Pricing Model, which requires certain company-specific inputs, including a beta for the company and certain financial metrics for the United States financial markets generally. This analysis resulted in a range of illustrative implied present values per share of Company common stock of $75.14 to $118.76.

Goldman Sachs also calculated illustrative implied future equity values per share of Company common stock as of December 31, 2020 by applying NTM P/E multiples ranging from 22.5x to 27.5x to estimated future Non-GAAP earnings per share (which is referred to in this section as “Non-GAAP EPS”) for each of the fiscal years 2021 to 2023, to derive a range of implied future share prices. These illustrative multiple estimates were derived by Goldman Sachs utilizing its professional judgment and experience, taking into account, among other things, current and historical NTM P/E multiples for common stock during the two-year period ended January 12, 2021 for the Company and the selected companies which, for the purpose of analysis, may be considered similar to certain operations of the Company and which are summarized above. These implied per share values were then discounted back to December 31, 2020, using an illustrative discount rate of 8.5%, reflecting an estimate of the Company’s cost of equity. Goldman Sachs derived this discount rate by applying the Capital Asset Pricing Model, which requires certain company-specific inputs, including a beta for the company and certain financial metrics for the United States financial markets generally. This analysis resulted in a range of illustrative implied present values per share of Company common stock of $77.59 to $122.58.

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Illustrative Discounted Cash Flow Analysis

Using the Forecasts, Goldman Sachs performed an illustrative discounted cash flow analysis on the Company. Using discount rates ranging from 8.0% to 9.0%, reflecting estimates of the Company’s weighted average cost of capital, Goldman Sachs discounted to present value as of December 31, 2020 (i) estimates of unlevered free cash flow for the Company for January 1, 2021 through December 31, 2025 reflected in the Forecasts and (ii) a range of illustrative terminal values for the Company, which were calculated by applying perpetuity growth rates ranging from 2.75% to 3.75%, to a $259 million terminal year estimate of the free cash flow to be generated by the Company, as reflected in the Forecasts (which analysis implied exit terminal year EBITDA multiples ranging from 11.3x to 16.5x). Goldman Sachs derived such range of discount rates by application of the Capital Asset Pricing Model, which requires certain company-specific inputs, including the company’s target capital structure weightings, the cost of long-term debt, after-tax yield on permanent excess cash, if any, future applicable marginal cash tax rate and a beta for the company and certain financial metrics for the United States financial markets generally. The range of perpetuity growth rates was estimated by Goldman Sachs utilizing its professional judgment and experience, taking into account the Forecasts and market expectations regarding long-term real growth of gross domestic product and inflation. Goldman Sachs derived ranges of illustrative enterprise values for the Company by adding the ranges of present values it derived above. Goldman Sachs then subtracted the net debt of the Company as of December 31, 2020, as provided by the management of the Company, to derive a range of illustrative equity values for the Company. Goldman Sachs then divided the range of illustrative equity values it derived by the number of fully diluted outstanding shares of the Company, as provided by the management of the Company. This analysis resulted in a range of illustrative values per share of Company common stock of $88.54 to $123.09.

Selected Transactions Analysis

Goldman Sachs analyzed certain information relating to selected transactions in the optical and high-growth semiconductor industries since September 2011. For each of the selected transactions, Goldman Sachs calculated and compared the NTM P/E multiple of the applicable target company based on Institutional Brokers’ Estimate System estimates at the time each such selected transaction was announced. While none of the target companies that participated in the selected transactions are directly comparable to the Company, the target companies that participated in the selected transactions are companies with operations that, for the purpose of analysis, may be considered similar to certain of the Company’s results, market size and product profile.

The following table presents the results of this analysis:

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Based on the results of the foregoing calculations and Goldman Sachs’ analyses of the various transactions and its professional judgment, Goldman Sachs applied a reference range of NTM P/E multiples of 21.2x (the lowest of the selected transactions involving high growth semiconductor companies) to 46.5x (the highest of the selected transactions involving high growth semiconductor companies) to the Company’s estimated EPS for the fiscal year 2021, as reflected in the Forecasts, to derive a range of illustrative per share values for the Company’s common stock. This analysis resulted in a range of illustrative values per share of Company common stock of $73.10 to $160.35. Goldman Sachs then applied a reference range of NTM P/E multiples of 16.2x (the lowest of the selected transactions involving optical companies) to 25.1x (the highest of the selected transactions involving optical companies) to the Company’s estimated EPS for the fiscal year 2021, as reflected in the Forecasts, to derive a range of illustrative per share values for the Company’s common stock. This analysis resulted in a range of illustrative values per share of Company common stock of $55.86 to $86.55.

The preparation of a fairness opinion is a complex process and is not necessarily susceptible to partial analysis or summary description. Selecting portions of the analyses or of the summary set forth above, without considering the analyses as a whole, could create an incomplete view of the processes underlying Goldman Sachs’ opinion. In arriving at its fairness determination, Goldman Sachs considered the results of all of its analyses and did not attribute any particular weight to any factor or analysis considered by it. Rather, Goldman Sachs made its determination as to fairness on the basis of its experience and professional judgment after considering the results of all of its analyses. No company or transaction used in the above analyses as a comparison is directly comparable to the Company or Parent or the contemplated transaction.

Goldman Sachs prepared these analyses for purposes of Goldman Sachs’ providing its opinion to the board of directors as to the fairness from a financial point of view of the $115.00 in cash per share to be paid to the holders (other than Parent and its affiliates) of shares of the Company common stock pursuant to the amended and restated merger agreement was fair from a financial point of view to such holders. These analyses do not purport to be appraisals nor do they necessarily reflect the prices at which businesses or securities actually may be sold. Analyses based upon forecasts of future results are not necessarily indicative of actual future results, which may be significantly more or less favorable than suggested by these analyses. Because these analyses are inherently subject to uncertainty, being based upon numerous factors or events beyond the control of the parties or their respective advisors, none of the Company, Parent, Goldman Sachs or any other person assumes responsibility if future results are materially different from those forecasts.

The merger consideration was determined through arm’s-length negotiations between the Company and Parent and was approved by the board of directors. Goldman Sachs provided advice to the Company during these negotiations. Goldman Sachs did not, however, recommend any specific amount of consideration to the Company or its board of directors or that any specific amount of consideration constituted the only appropriate consideration for the merger.

As described above, Goldman Sachs’ opinion to the board of directors was one of many factors taken into consideration by the board of directors in making its determination to approve the amended and restated merger agreement. The foregoing summary does not purport to be a complete description of the analyses performed by Goldman Sachs in connection with the fairness opinion and is qualified in its entirety by reference to the written opinion of Goldman Sachs attached as Annex B.

Goldman Sachs and its affiliates are engaged in advisory, underwriting and financing, principal investing, sales and trading, research, investment management and other financial and non-financial activities and services for various persons and entities. Goldman Sachs and its affiliates and employees, and funds or other entities they manage or in which they invest or have other economic interests or with which they co-invest, may at any time purchase, sell, hold or vote long or short positions and investments in securities, derivatives, loans, commodities,

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currencies, credit default swaps and other financial instruments of the Company, Parent, any of their respective affiliates and third parties, or any currency or commodity that may be involved in the transaction contemplated by the amended and restated merger agreement for the accounts of Goldman Sachs and its affiliates and employees and their customers. Goldman Sachs acted as financial advisor to the Company in connection with, and participated in certain of the negotiations leading to, the transaction contemplated by the amended and restated merger agreement. Goldman Sachs has also provided certain investment banking services to Parent and its affiliates from time to time for which the Investment Banking Division of Goldman Sachs has received, and may receive, compensation, including having acted as a commercial paper dealer for Parent since 2015. During the two-year period ended January 14, 2021, Goldman Sachs has received compensation for financial advisory and/or underwriting services provided by its Investment Banking Division to Parent and/or its affiliates of approximately $200,000. Other than in connection with the transaction, as described below, during the two year period ended January 14, 2021, the Investment Banking Division of Goldman Sachs has not been engaged by the Company or its affiliates to provide financial advisory or underwriting services for which Goldman Sachs has recognized compensation. Goldman Sachs may also in the future provide investment banking services to the Company, Parent and their respective affiliates for which the Investment Banking Division of Goldman Sachs may receive compensation. In addition, a Director on the Board of Parent is currently affiliated with the Goldman Sachs Group, Inc. as a Director.

The board of directors of selected Goldman Sachs as its financial advisor because it is an internationally recognized investment banking firm that has substantial experience in transactions similar to the merger. Pursuant to a letter agreement dated June 25, 2019, the Company engaged Goldman Sachs to act as its financial advisor in connection with the contemplated transaction. The engagement letter between the Company and Goldman Sachs provides for a transaction fee that is estimated, based on the information available as of the date of announcement, at approximately $56,000,000, $3,000,000 of which was paid in connection with the presentation by Goldman Sachs to the board of directors of the final results of the study Goldman Sachs undertook to determine whether it was able to render a fairness opinion in connection with the consideration paid pursuant to the original merger agreement, and the remainder of which is contingent upon the consummation of the merger. In addition, the Company has agreed to reimburse Goldman Sachs for certain of its expenses, including attorneys’ fees and disbursements, and to indemnify Goldman Sachs and related persons against various liabilities, including certain liabilities under the federal securities laws.

Financial Forecasts

The Company does not, as a matter of course, publicly disclose financial forecasts as to future financial performance, earnings or other results for extended periods due to, among other reasons, the unpredictability of its business and competitive markets in which it operates, the historic demand volatility in the optical market, limitations of customer order visibility and lack of customer demand forecast predictability, the inherent difficulty of accurately predicting future periods and the likelihood that the underlying assumptions and estimates may prove incorrect. While the Company prepares forecasts periodically for internal budgeting and business planning purposes, such periodic forecasts generally focus on the then-current quarter and calendar year and, from time to time, the two to three immediately following fiscal years, and are updated from time to time to reflect historical results, product and market developments and any changes to customer forecasts.

However, in connection with the evaluation of a possible transaction, the Company provided the following projections to its directors and their advisors in connection with their consideration of the merger, as well as to Parent and, in the case of the June LRP described below, to Party C, in connection with their due diligence review of the Company.

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These projections contained certain non-public financial forecasts that were prepared by our management.

A summary of the financial forecasts included in the October Projections, the Long-Range Plan, the June LRP and the December LRP is included below. This summary is not being included in this proxy statement to influence your decision whether to vote for or against the proposal to adopt the amended and restated merger agreement, but is being included because these financial forecasts were made available to the Company’s directors and their advisors as well as to Parent and Party C, as applicable. The inclusion of this information should not be regarded as an indication that the Company’s directors or their advisors, or any other person, considered, or now considers, such financial forecasts to be material or to be necessarily predictive of actual future results, and these forecasts should not be relied upon as such. Internal financial forecasts prepared by the Company’s management, upon which the summary financial forecasts included below were based, are subjective in many respects. There can be no assurance that these financial forecasts will be realized or that actual results will not be significantly higher or lower than forecasted.

In addition, the financial forecasts were not prepared with a view toward public disclosure or toward complying with generally accepted accounting principles, which we refer to as GAAP, the published guidelines of the SEC regarding projections or the use of non-GAAP financial measures or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information. Neither our independent registered public accounting firm, nor any other independent accountants, have audited, compiled, examined or performed any procedures with respect to the financial forecasts contained herein, nor have they expressed any opinion or any other form of assurance on such information or its achievability.

These financial forecasts were based on numerous variables and assumptions that are inherently uncertain and may be beyond our control. We believe the assumptions that our management used as a basis for this projected financial information were reasonable, and that the bases on which the financial forecasts were prepared reflected

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the best currently available estimates and judgments of management of the future financial performance of the Company, at the time our management prepared these financial forecasts, given the information our management had at the time. Important factors that may affect actual results and cause these financial forecasts not to be achieved include, but are not limited to, risks and uncertainties relating to our business (including our ability to achieve strategic and product development goals, objectives and targets over the applicable periods), industry performance and historical optical market demand volatility, general business and economic conditions, including the concentrated nature of the Company’s revenue profile and the scope of its dependency on volatile markets like China and the Data Center Interconnect market, international trade and tariff developments, impacts of the global COVID-19 pandemic and related response measures, increases in operating expenses to maintain product innovation and expand the product portfolio, the regulatory environment, including actions of the U.S. Department of Commerce, and other factors described in or referenced under “Cautionary Statement Concerning Forward-Looking Information” beginning on page [—] and “—Reasons for the Merger; Recommendation of the Board of Directors” beginning on page [—] and those risks and uncertainties detailed in the Company’s public periodic filings with the SEC. In addition, the forecasts also reflect assumptions that are subject to change and do not reflect revised prospects for our business or our major customers, changes in general business or economic conditions, or any other transaction or event that has occurred or that may occur and that was not anticipated at the time the financial forecasts were prepared. Accordingly, there can be no assurance that these financial forecasts will be realized or that our future financial results will not materially vary from these financial forecasts.

No one has made or makes any representation to any stockholder regarding the information included in the financial forecasts set forth below. We have made no representation to Parent or Merger Sub in the amended and restated merger agreement concerning these financial forecasts.

We have not updated and do not intend to update or otherwise revise the financial forecasts to reflect circumstances existing after the date when made or to reflect the occurrence of future events, even in the event that any or all of the assumptions on which such forecasts were based are shown to be in error. In light of the foregoing factors and the uncertainties inherent in these projections, stockholders are cautioned not to place undue, if any, reliance on these projections.

In preparing the October Projections, our management made the following material assumptions:

In preparing the Long-Range Plan, our management made the following material assumptions:

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In preparing the June LRP, our management made the following material assumptions:

In preparing the December LRP, our management made the following material assumptions:

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The estimates of adjusted EBITDA, non-GAAP operating income, non-GAAP net income, diluted shares outstanding, non-GAAP earnings per share and unlevered free cash flow constitute non-GAAP financial measures within the meaning of applicable rules and regulations of the SEC. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information presented in compliance with GAAP, and non-GAAP financial measures as used by the Company may not be comparable to similarly titled amounts used by other companies.

The following is a summary of the financial forecasts for the Company prepared by its management and provided to its directors and, in the case of the Long-Range Plan, the June LRP and the December LRP, their advisors as well as to Parent and, in the case of the June LRP, to Party C:

October Projections

Long-Range Plan

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June LRP

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Using the June LRP provided by the Company, Goldman Sachs calculated and assumed unlevered free cash flows for the Company that were approved by the Company for use by Goldman Sachs in its analyses prepared in connection with the study Goldman Sachs undertook to determine whether it was able to render a fairness opinion in connection with the consideration payable pursuant to the original merger agreement, consisting of: $27 million for calendar year 2019; $32 million for calendar year 2020; $80 million for calendar year 2021; $118 million for calendar year 2022; $145 million for calendar year 2023; and $184 million for calendar year 2024. The unlevered free cash flow forecasts calculated and assumed by Goldman Sachs also included a terminal year value of $192 million and a value for unlevered free cash flow for the period of April 1 to December 31, 2019 of $11 million. Unlevered free cash flow is calculated as non-GAAP operating income, less stock-based compensation, less cash taxes, plus depreciation, amortization and other, less changes in working capital, less capital expenditures. In addition, the unlevered free cash flow calculation for 2019 includes a $1 million positive adjustment to incorporate the impact of deferred income taxes, non-cash lease expenses, certain litigation related expenses and other selected expenses.

December LRP

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Using the December LRP provided by the Company, Goldman Sachs calculated and assumed unlevered free cash flows for the Company that were approved by the Company for use by Goldman Sachs in its analyses prepared in connection with the study Goldman Sachs undertook to determine whether it was able to render a fairness opinion in connection with the consideration payable pursuant to the amended and restated merger agreement of: $104 million for calendar year 2021; $119 million for calendar year 2022; $135 million for calendar year 2023; $168 million for calendar year 2024; and $219 million for calendar year 2025. The unlevered free cash flow forecasts calculated and assumed by Goldman Sachs also included a terminal year value of $259 million. Unlevered free cash flow is calculated as non-GAAP operating income, less stock-based compensation, less cash taxes, plus depreciation, amortization and other, less changes in working capital, less capital expenditures.

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Closing and Effective Time of the Merger

The closing of the merger will occur no later than the third business day following the satisfaction or waiver of all of the closing conditions set forth in the amended and restated merger agreement (described in the section entitled “The Amended and Restated Merger Agreement — Conditions to the Merger” beginning on page [—]). The parties may also agree in writing to close at any other time.

Assuming timely satisfaction of necessary closing conditions, including the approval by our stockholders of the proposal to adopt the amended and restated merger agreement, we currently anticipate that the merger will be consummated during the first calendar quarter of 2021, or prior to March 31, 2021. The merger will become effective upon the filing of a certificate of merger with the Secretary of State of the State of Delaware or at such subsequent time or date as Parent and the Company may agree and specify in the certificate of merger, which we refer to as the effective time.

Payment of Merger Consideration and Surrender of Stock Certificates

Promptly, and in any event within three business days, after the effective time of the merger, a letter of transmittal will be mailed to each record holder of shares of Company common stock describing how such holder should surrender such holder’s shares of Company common stock for the merger consideration.

You should not return your stock certificates with the enclosed proxy card, and you should not forward your stock certificates to the exchange agent (described in the section entitled “The Amended and Restated Merger Agreement — Payment Procedures” beginning on page [—]) without a letter of transmittal.

If your shares of Company common stock are certificated, you will not be entitled to receive the per share merger consideration until you deliver a duly completed and executed letter of transmittal to the exchange agent and you must also surrender your stock certificate or certificates to the exchange agent. If your shares of Company common stock are held in book entry, which we refer to as uncertificated shares, surrender of any uncertificated shares will be effected in accordance with the exchange agent’s customary procedures with respect to securities that are uncertificated or represented by book entry and no holder of uncertificated shares will be required to deliver a certificate or an executed letter of transmittal to the exchange agent in order to receive the merger consideration to which such holder is otherwise entitled under the amended and restated merger agreement. If ownership of your shares is not registered in the transfer records of the Company, a check for any cash to be delivered will only be issued if the applicable letter of transmittal is accompanied by all documents reasonably required by the Company to evidence and effect such transfer and to evidence that any applicable stock transfer taxes have been paid.

If you have lost a certificate, or if it has been stolen or destroyed, then before you will be entitled to receive the merger consideration, you will have to make an affidavit of the loss, theft or destruction and, if reasonably required by Parent or the exchange agent, post a bond, in such reasonable and customary amount as Parent or the exchange agent may reasonably direct, as indemnity against any claim that may be made against Parent, the surviving corporation, the exchange agent or any of their respective representatives with respect to such certificate. These procedures will be described in the letter of transmittal that you will receive, which you should read carefully in its entirety.

Interests of Certain Persons in the Merger

In considering the recommendation of the board of directors with respect to the amended and restated merger agreement, you should be aware that the Company’s directors and executive officers have interests in the merger that may be different from, or in addition to, the interests of our stockholders generally, as more fully described below. The board of directors was aware of these interests and considered them, among other matters, in reaching the determination that the terms and conditions of the merger and the amended and restated merger agreement

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were advisable, fair to and in the best interests of the Company and its stockholders and in making their recommendations regarding adoption of the merger and the amended and restated merger agreement as described in the section entitled “The Merger — Reasons for the Merger; Recommendation of the Board of Directors” beginning on page [—].

Please see the section of this proxy statement entitled “The Merger — Compensation Payable to our Named Executive Officers” beginning on page [—] for additional information with respect to the compensation that our named executive officers may receive in connection with the merger.

Interests With Respect to Company Equity

Amendment of 2018 TSR PRSUs

In 2018, as part of the annual equity grant process, the Company granted PRSU awards to the Company’s executive officers under the Company’s 2016 Equity Incentive Plan. The number of shares that vest under the PRSU awards is measured based on the Company’s percentile achievement of relative TSR against a peer group over a three-year performance period that ran from January 1, 2018 to December 31, 2020. We refer to these PRSUs as the 2018 TSR PRSUs. The number of shares that could have been earned under the 2018 TSR PRSUs ranged from 0% to 200% of the target numbers of shares subject to the PRSU awards depending on the level of achievement of the TSR performance metric.

In connection with the Company’s execution of the amended and restated merger agreement, the parties agreed that the 2018 TSR PRSUs could be amended to provide that, for purposes of determining the Company’s TSR pursuant to the 2018 TSR PRSU agreements, the “ending price” (as defined in the agreements) of the Company’s common stock would be determined based on the merger consideration of $115.00 per share. As a result, the compensation committee of the Company’s board of directors, which we refer to as the compensation committee, determined that the number of shares that were earned under the 2018 TSR PRSUs based on the Company’s relative TSR calculated using the “ending price” of $115.00 was equal to 200% of the target number of shares subject to the awards. The 2018 TSR PRSUs were settled on January 15, 2021 and are no longer outstanding awards. If the 2018 TSR PRSUs had not been so amended, the number of shares earned under the 2018 TSR PRSUs would have been equal to 148% of the target number of shares subject to the awards.

2019 TSR PRSUs

In 2019, as part of the annual equity grant process, the Company granted PRSU awards to the Company’s executive officers under the Company’s 2016 Equity Incentive Plan. The number of shares that vest under the PRSU awards is measured based on the Company’s percentile achievement of relative TSR against a peer group over a three-year performance period that runs from January 1, 2019 to December 31, 2021. We refer to these PRSUs as the 2019 TSR PRSUs. The number of shares that may be earned under the 2019 TSR PRSUs ranges from 0% to 200% of the target numbers of shares subject to the PRSU awards depending on the level of achievement of the TSR performance metric.

Pursuant to the PRSU agreements with respect to the 2019 TSR PRSUs, in the event of a “change in control” (as defined in the CIC plan) during the applicable performance period pursuant to which consideration is received by holders of Company common stock, the performance period will be deemed to end upon the closing date of the change in control. For purposes of determining the Company’s TSR pursuant to the applicable 2019 TSR PRSU agreement, the “ending price” (as defined in the applicable agreement) of the Company’s common stock will be determined based on the price to be paid to holders of Company common stock in connection with the change in control, as determined by the compensation committee.

For purposes of the 2019 TSR PRSU agreements, the merger will constitute a change in control of the Company and the per share merger consideration will be the “ending price” as defined in such agreements. The Company’s

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share price performance based on the per share merger consideration will be compared to share price performance of the peer groups on or shortly prior to the closing of the merger to determine the level of achievement of the 2019 TSR PRSUs and the number of 2019 TSR PRSUs that will vest immediately prior to the merger.

Pursuant to the 2019 TSR PRSU award agreements, any such PRSUs for which performance has been achieved will vest immediately prior to the change in control and any such 2019 TSR PRSUs that do not so vest will be cancelled at such time for no consideration. In light of the increased per share merger consideration from $70.00 to $115.00 in cash pursuant to the amended and restated merger agreement, the Company believes it is possible that the number of 2019 TSR PRSUs that will become vested as of the closing of the merger could be 200% of the target number of 2019 TSR PRSUs. However, in the event that less than 200% of the target number of 2019 TSR PRSUs become vested as of the closing, Parent has consented to a potential amendment to the 2019 TSR PRSUs that would allow 2019 TSR PRSUs reflecting such shortfall to be treated as unvested PRSUs for purposes of the amended and restated merger agreement in order to provide additional retention following the effective time of the merger. Each such unvested 2019 TSR PRSU would be converted into the right to receive an amount in cash without interest, equal to the merger consideration, subject to deduction for any required withholding tax, payable on December 31, 2021 (the last day of the original performance period), subject to the CIC plan or an employment offer document entered into with Parent.

Treatment of Company Equity Awards and Employee Stock Purchase Plan

Each Company stock option that is outstanding, vested and unexercised immediately prior to the effective time of the merger will be canceled at the effective time and converted into the right to receive an amount in cash without interest, equal to the excess, if any, of the merger consideration over the exercise price per share of such stock option, subject to deduction for any required withholding tax; provided that, in the event that the exercise price of any such vested stock option is equal to or greater than the merger consideration, such stock option will be canceled at the effective time, without any consideration being payable in respect thereof and have no further force or effect.

Each Company stock option that is outstanding and unvested immediately prior to the effective time of the merger will be canceled at the effective time and converted into the right to receive an amount in cash without interest, equal to the excess, if any, of the merger consideration over the exercise price per share of such stock option, subject to deduction for any required withholding tax, payable to the extent, and at the applicable times, such unvested stock option would have become vested under the vesting schedule in place for such stock option immediately prior to the effective time, including under the terms of the CIC plan, and any scheduled retention agreement after giving effect to any applicable employment offer documents entered into with Parent; provided that, in the event that the exercise price of any such unvested stock option is equal to or greater than the merger consideration, such stock option will be canceled at the effective time, without any consideration being payable in respect thereof and have no further force or effect.

Each RSU and PRSU that is outstanding and vested and has not been settled immediately prior to the effective time of the merger (which includes the 2019 TSR PRSUs and certain RSUs that will become vested as of the closing of the merger) will be canceled at the effective time and converted into the right to receive an amount in cash without interest, equal to the merger consideration, subject to deduction for any required withholding tax.

Each RSU and PRSU that is outstanding and unvested immediately prior to the effective time of the merger will be canceled at the effective time and converted into the right to receive an amount in cash without interest, equal to the merger consideration, subject to deduction for any required withholding tax, payable to the extent, and at the applicable times, such unvested RSU or PRSU would have become vested under the vesting schedule in place for such RSU or PRSU immediately prior to the effective time, including under the terms of the CIC plan and any scheduled retention agreement after giving effect to any applicable employment offer documents entered into with Parent.

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Following execution of the original merger agreement, the Company took all actions with respect to the Company ESPP that were required to provide that, (i) with respect to any offering period in effect as of the date of the original merger agreement, no employee who was not a participant in the Company ESPP as of the date of the original merger agreement could become a participant in the Company ESPP and no participant could increase the percentage amount of his or her payroll deduction election from that in effect on the date of the original merger agreement for such offering period; (ii) subject to the consummation of the merger, the Company ESPP will terminate effective immediately prior to the effective time of the merger; and (iii) the Company ESPP was suspended and no new offering periods have been or will be commenced under the Company ESPP prior to the termination of the amended and restated merger agreement.

Outstanding Shares of Company Common Stock Beneficially Owned by Certain Persons

The Company’s directors and executive officers will receive the same cash consideration for any shares of Company common stock that they hold on the same terms and conditions as other Company stockholders. The following table sets forth, as of January 20, 2021, for each person who has served as a director or executive officer of the Company since the beginning of our last completed fiscal year (i) the aggregate number of outstanding shares of Company common stock beneficially owned and (ii) the aggregate merger consideration that would be payable with respect to such shares of Company at the closing of the merger. The amounts shown in the following table do not reflect any future grants, dividends, deferrals, sales or other dispositions that may occur following January 20, 2021 and prior to the closing of the merger or shares underlying options, RSUs or 2019 TSR PRSUs outstanding as of January 20, 2021 held by each such person.

Outstanding Company Equity Awards Held by Certain Persons

As described above, at the effective time of the merger, (i) each Company stock option that is outstanding, vested and unexercised will be canceled and converted into the right to receive an amount in cash, without interest, equal to the excess, if any, of the merger consideration over the exercise price per share of such stock option, subject to deduction for any required withholding tax; provided that, in the event that the exercise price of any such vested stock option is equal to or greater than the merger consideration, such stock option will be canceled at the effective time, without any consideration being payable in respect thereof and have no further force or effect and (ii) each RSU and PRSU that is outstanding and vested and has not been settled immediately prior to the effective time of the merger (which includes the 2019 TSR PRSUs that will become vested based on actual results as of the closing of the merger and certain RSUs that will become vested as of the closing of the merger) will be canceled at the effective time and converted into the right to receive an amount in cash without interest, equal to the merger consideration, subject to deduction for any required withholding tax.

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The following table sets forth the cash payments that would be payable at the closing of the merger in respect of Company stock options, RSUs and PRSUs held as of January 20, 2021 by each person who has served as a director or executive officer of the Company since the beginning of our last completed fiscal year and, in the case of stock options and RSUs, assuming vesting of such awards in accordance with their terms through an assumed closing date of the merger of March 15, 2021 (which is the date assumed solely for the purposes of this disclosure) and, in the case of 2019 TSR PRSUs, reflecting performance-based vesting of such awards immediately prior to closing based on the merger consideration of $115.00 per share in accordance with the terms of such awards (and assuming that the Company’s relative percentile TSR achievement against the applicable peer groups as of January 20, 2021, based on that $115.00 per share price, which would result in 156% of the shares subject to such awards vesting, remains unchanged through the assumed closing date of the merger). All unvested RSUs held by non-employee directors will accelerate at the closing of the merger and such RSUs are included in the table below. The amounts shown in the following table do not reflect any future grants, dividends, deferrals or forfeitures that may occur following January 20, 2021 and prior to the closing of the merger.

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