Protect Code for Third Party Deployment

I have a MATLAB script that will be used by a third party contractor to be further developed and placed onto an embedded system. More specifically, the third party will be using our code in a Simulink model that will be integrated onto the embedded system. I have tried to look into several options for distributing my code, however I am not sure the correct path to take. From my understanding, the Simulink model that will be developed will be coded into C/C++ by MATLAB Coder and flashed to the embedded system. Here are the options I have considered so far:

1. Use MATLAB Coder or rewrite code in C using MATLAB API and supply a MEX function;
2. Use MATLAB Compiler to create a linked library, standalone executable, CTF (does not seem to be possible for this specific use case);
3. Deploy the source code as P-code (not recommended by Mathworks to protect IP from third parties).

Also, one of the main issues is that I am not sure of how to prepare my MATLAB script for use in Simulink flow. Is there anything additional that I need to do to my code other than provide a basic function that takes inputs and gives outputs?

Has anyone encountered this sort of issue and may have recommendations for code protection?