The Management Board of Vigo Photonics S.A. with its registered office in Ożarów Mazowiecki (the "Company", "Issuer"), hereby announces that on September 12, 2024, the Company entered into a financing agreement with the European Investment Bank (the "EIB") (the "Financing Agreement" or "Agreement") under the InvestEU program, which aims to provide financing for projects of strategic importance to the economy that contribute to the implementation of EU policy objectives. Under the Agreement, the EIB has undertaken to grant the Company financing in the form of a venture debt loan in the maximum amount of EUR 21,000,000 (i.e. the equivalent of PLN 90,014,400 converted at the average exchange rate of the National Bank of Poland on September 11, 2024, EUR 1 = PLN 4.2864). In addition, on September 12, 2024, the Company also entered into an agreement with the EIB on the issue of subscription warrants to the EIB (the "Warrant Agreement").

The purpose of the Financing Agreement concluded with the EIB is to support the continuation of the research and development work of the Company and the Issuer's Capital Group aimed at developing photonic integrated circuit (PIC) technology, as well as infrared (IR) detectors and modules. The Issuer's Management Board plans to allocate the majority of potential funds to the development of the Company's research and development activities related to the development of photonic integrated circuit (PIC) technology and infrared (IR) detectors and modules. The projects implemented by the Issuer are aimed at improving the current technology and existing projects and developing new products in new technologies in order to achieve "best-in-class parameters" and the most modern level of advancement in the scope of developed technologies.

The financing will be paid in three tranches: Tranche A in the amount of EUR 6,000,000, Tranche B in the amount of EUR 7,000,000 and Tranche C in the amount of EUR 8,000,000. The tranches may be paid to the Company within a period of 12 to 36 months (depending on the given tranche) from the date of entry into force of the Agreement. The Company is obliged to repay each of the paid tranches in one installment after 6 years from its launch. The interest rate for each of the tranches will be 8% per annum. Interest on each tranche will be payable in the balloon formula, i.e. together with the repayment of the capital after 6 years from the launch of a given tranche. The Financing Agreement is conditional and will enter into force subject to obtaining the consent of one of the banks financing the Company's operations, within a period not longer than 6 months from the date of signing the Financing Agreement. Upon fulfilment of the conditions set out in the Agreement, including the condition of the Company effectively issuing and registering subscription warrants in favour of EIB in accordance with the terms set out in the Warrant Agreement (described in detail below), the payment of Tranche A will be possible.

Upon fulfillment of the conditions specified in the Agreement, including the condition of effective issuance and registration by the Company of subscription warrants in favour of the EIB in accordance with the conditions specified in the Warrant Agreement (described in detail below), the payment of Tranche A will be possible. Other conditions for the payment of Tranche B include: (i) obtaining the level of revenues and EBITDA margin specified in the agreement; and (ii) obtaining by the Company additional financing in an amount of at least PLN 20,000,000, originating e.g. from grants, funds or EU financing. Other conditions for the payment of Tranche C include: (a) obtaining the level of revenues and EBITDA margin
specified in the agreement; (ii) obtaining by the Company additional financing in an amount of at least PLN 35,000,000, originating e.g. from grants, funds or EU financing; (iii) obtaining by the Company the first industrial implementation of photonic integrated circuit (PIC) technology, including at least the signing of the terms of obtaining debt and equity financing and a strategy of cooperation with key suppliers.

The additional consideration for Tranche A, Tranche B and Tranche C will be the issue by the Company to the EIB of subscription warrants representing a total of 8% of the fully issued share capital and conditional capital of the Company (the "Warrants"), which will be acquired free of charge by the EIB and will entitle the holder to acquire shares in the Company (the "Shares") at a nominal price of PLN 1.00. Both the EIB and the Company will be able to cancel the payment of unpaid Tranches if their payment is no longer justified in the context of the purpose and conditions resulting from the content of the Agreement. The EIB may cancel the unused part of the financing or demand early repayment of the financing together with accrued interest and all other amounts accrued or remaining to be repaid under the Agreement
in the situations and in the manner specified in the Agreement. In particular, the obligation to early repayment of the financing received by the Company, except for the situation of issuing written consent of the EIB, may arise if: (a) the control over the Company changes; (b) Mr Adam Piotrowski or Mr Marcin Szrom; or at least 2 of the following persons: Przemysław Kalinowski, Włodzimierz Strupiński or Marcin Ratajczyk, will cease to actively participate in the management of the Company; (c) the Company will lose control over at least 50% of the share capital of its material subsidiaries; (e) the Issuer will dispose of certain assets without the consent of the EIB, except for the exceptions indicated in the Finance Agreement.

The most important provisions of the Warrant Agreement are as follows:

(i) The Warrants will be acquired by EIB free of charge and will entitle the holder to acquire the Company's Shares at an issue price equal to the nominal value of each Share;

(ii) The rights from the Warrants to acquire the Shares may be exercised within a period of 10 years from the date of conclusion of the Warrant Agreement, but after the expiry of these 10 years the Company will be obliged to issue new warrants for the next 10 years reflecting the conditions described above;

(iii) The Warrant Agreement regulates the conditions for exercising the rights from the Warrants to acquire the Shares, making this right dependent in particular on the payment of subsequent tranches of financing under the Financing Agreement and the occurrence of other events specified in the Warrant Agreement. In the event of non- payment of a specific tranche, EIB will not be entitled to exercise the rights from the Warrants related to it;

(iv) The Warrants will be transferable on the terms specified in the Warrant Agreement, including in the event of the expiry of the Financing Agreement, in the event of repayment of the financing, sale of the assets of the Company or companies from the capital group of the Company (except for the cases permitted in the Financing Agreement) or acquisition of control over the Company (understood as the
direct or indirect acquisition of control over at least 50% of the share capital of the Company). The Warrant Agreement specifies the principles for the sale and acquisition of Warrants, including the obligation of the Company to acquire Warrants from their holder for a fee for the purpose of redemption in the cases specified in the Warrant Agreement, consistent with and concurrent with the terms specified in the Financing Agreement;

(v) According to the Warrant Agreement, the EIB will have the right to demand the Company to repurchase or redeem the Warrants (under the irrevocable option, the so- called Put Option). In the event that the EIB requests the repurchase or redemption of the Warrants (under the put option) by the Issuer, the Company will be obliged to pay to the EIB an appropriate repurchase or redemption fee, the amount of which should correspond to the fair market value of the Warrants (this amount will be determined
on the basis of a detailed procedure provided for in the Warrant Agreement, and the Company will have the right to challenge it). The total amount that the Company will be obliged to pay to the EIB for exercising the discussed right may not exceed EUR 17 million. Additionally, in the scope of the irrevocable put option, the Warrant Agreement also regulates the Company's protection against excessive cash outflow by spreading any payments under this option to the EIB into partial payments, with 3-
month intervals between each payment. In such case, the entire payment under the put option should be paid within 2 years;

(vi) In the event of the occurrence of certain events causing dilution of the Company's share capital, EIB will be entitled to acquire additional subscription warrants, subject to the exceptions provided for in the Warrant Agreement, including the established minimum issue price of shares above which EIB will not be entitled to acquire additional subscription warrants or an issue intended for a strategic investor.

The Warrant Agreement also regulates the Company's obligations in terms of obtaining the EIB's consent to perform certain activities and information obligations towards the EIB. In the performance of the Warrant Agreement, the Management Board of the Company will convene an Extraordinary General Meeting, to which it will submit for consideration appropriate resolutions necessary for the effective issue of Warrants to the EIB.

Regardless of the signed Agreement and Warrant Agreement, the Company will continue its activities aimed at securing other sources of financing for its operations. The Company does not rule out the possibility that in the event that the Company obtains alternative financing on more favourable terms, the Agreement and Warrant Agreement will not be implemented.

Decisions on the use of specific solutions will be dictated by the interests of the Company and its shareholders and will depend on external economic conditions affecting the implementation of the Company's plans.

In the opinion of the Issuer's Management Board, the signed Agreement with the EIB and the Warrant Agreement may contribute to building the Company's long-term position within the framework of the adopted strategy and will have a positive impact on the assessment and perception of the Company on the international market.