Contract analysis

1. General Halcyon Semiconductor Aktiengesellschaft ("Halcyon," the "Company," "we," "us," or "our") is a German stock corporation (Aktiengesellschaft) organized under the laws of the Federal Republic of Germany. The Company is registered with the commercial register (Handelsregister) of the local court (Amtsgericht) of Munich under registration number HRB 217458, with its registered office and principal executive of

2. American Depositary Shares 2.1 ADS Ratio Each ADS represents the right to receive two (2) ordinary shares (Stammaktien) of Halcyon deposited with a custodian bank in the Federal Republic of Germany (the "Custodian") appointed by the Depositary pursuant to the terms of the Deposit Agreement. Accordingly, the ADS ratio is one (1) ADS for every two (2) ordinary shares (the "ADS Ratio"). Each ADS will also represent t

3. Deposit of Ordinary Shares; Issuance of ADSs 3.1 Deposit Mechanics Ordinary shares may be deposited with the Custodian in the Federal Republic of Germany against the issuance of ADSs by the Depositary in the United States. The Custodian will hold the ordinary shares through the facilities of Ashgrove Enterprises Banking AG, the central securities depository in Germany. Ashgrove Enterprises Banking AG provides secu

4. Withdrawal of Ordinary Shares; Cancellation of ADSs ADS holders (or their duly authorized agents) may at any time surrender ADSs to the Depositary for cancellation and request delivery of the corresponding number of ordinary shares held by the Custodian. Upon receipt of ADSs for cancellation and compliance with the conditions described below, the Depositary will instruct the Custodian to deliver the underlying ord

5. Depositary Fees and Charges The following table sets forth the fees and charges that ADS holders may be required to pay in connection with the ADSs: 5.1 Annual Depositary Service Fee ADS holders will be charged an annual depositary service fee of $0.05 per ADS per annum. The annual depositary service fee compensates the Depositary for the administration and servicing of the ADS program, including the maintenance o

6. Dividends and Other Distributions 6.1 Cash Dividends and Distributions If Halcyon makes a cash distribution on its ordinary shares (whether characterized as a dividend, return of capital, or otherwise under German law), the Depositary will, subject to the terms of the Deposit Agreement, convert the euro-denominated distribution to U.S. dollars to the extent it determines that such conversion is practicable and can

7. Voting Rights 7.1 German Corporate Law Background Halcyon is governed by the German Stock Corporation Act (Aktiengesetz, or "AktG"). Under the AktG, shareholders exercise their voting rights at annual general meetings (ordentliche Hauptversammlungen) and extraordinary general meetings (außerordentliche Hauptversammlungen) of the Company. Matters submitted to shareholders for approval at general meetings may includ

8. Pre-Emptive Rights Under German law and the Company's articles of association (Satzung), holders of ordinary shares generally have pre-emptive rights (Bezugsrecht) to subscribe for newly issued shares in proportion to their existing shareholdings whenever the Company increases its share capital by issuing new shares for cash contributions, unless such pre-emptive rights are excluded by a resolution of the sharehol

9. Changes Affecting Ordinary Shares If there is any change in the nominal or par value of the ordinary shares, or any stock split (Aktienteilung), reverse stock split (Aktienzusammenlegung), consolidation, reclassification, or other similar event affecting the ordinary shares, the Depositary will, in its discretion, adjust the ADS Ratio and may take such other steps as it deems necessary or appropriate to reflect su

10. Inspection of Books and Records of the Depositary The Depositary will maintain, at its principal office at 101 Barclay Street, New York, NY 10286, a register of the names, addresses, and holdings of all registered holders of ADSs (the "ADS Register") and a record of each issuance and cancellation of ADSs. The ADS Register and such records will be open for inspection by ADS holders and by the Company during the De

11. Reports and Other Communications The Depositary will make available for inspection by ADS holders at its principal office at 101 Barclay Street, New York, NY 10286, any reports, notices, and communications (including annual and interim financial statements and proxy materials) that the Company furnishes to the Depositary for that purpose. Such materials will be made available in the form received by the Depositar

12. Amendment and Termination of the Deposit Agreement 12.1 Amendment. The Company and the Depositary may at any time and from time to time agree to amend the Deposit Agreement and the form of ADR in any respect that they deem necessary or desirable, without the consent of any ADS holder or beneficial owner of ADSs, for the purpose of, among other things: (a) adding to, changing, or eliminating any provision of the D

13. Limitations on Obligations and Liability of the Depositary and Halcyon 13.1 Depositary's Liability Neither the Depositary nor the Company will be liable to any ADS holder or beneficial owner if it is prevented, hindered, or delayed in performing its obligations under the Deposit Agreement by reason of any present or future law, rule, regulation, decree, or governmental order or directive of any country or jurisdi

14. Taxes ADS holders will be responsible for any taxes, duties, assessments, or governmental charges (including, without limitation, withholding taxes, stamp duties, and transfer taxes) payable in connection with their ADSs or the Deposited Securities underlying such ADSs, regardless of whether such taxes are imposed by the United States, Germany, or any other jurisdiction. The Depositary may refuse to register any

15. Foreign Currency Conversion The Depositary will arrange for the conversion of all foreign currency (primarily euros) received in respect of the Deposited Securities into U.S. dollars if, in the Depositary's judgment, such conversion is practicable and can be done on a reasonable basis. The Depositary will distribute the resulting U.S. dollar amounts to ADS holders entitled thereto, after deduction of the Deposita

16. Governing Law; Jurisdiction The Deposit Agreement and the ADRs are governed by and will be construed in accordance with the laws of the State of Delaware, without regard to the conflicts of law principles thereof. The selection of Delaware law as the governing law of the Deposit Agreement and the ADRs is without prejudice to the mandatory provisions of U.S. federal securities law, which will apply to the extent r

17. Enforceability of Civil Liabilities Halcyon is organized under the laws of the Federal Republic of Germany, and substantially all of the Company's assets are located outside the United States. In addition, most of the members of the Company's Management Board (Vorstand) and Supervisory Board (Aufsichtsrat) and certain of the experts named in this prospectus are residents of countries other than the United States,

18. Direct Registration System (DRS) and Profile Modification System The ADSs may be held in uncertificated (book-entry) form through DTC's Direct Registration System ("DRS") and Profile Modification System. The DRS is a system administered by DTC pursuant to which the Depositary may register the ownership of uncertificated ADSs, which ownership is confirmed by periodic statements sent to the ADS holders by the trans

19. Relationship of the Depositary to ADS Holders ADS holders should note that neither the Depositary nor the Company has any fiduciary duty or fiduciary relationship with any ADS holder or beneficial owner of ADSs. The Depositary acts solely in accordance with the terms of the Deposit Agreement and applicable law, and its duties to ADS holders are contractual in nature. ADS holders are not parties to the Deposit Agr

20. Further Information A copy of the Deposit Agreement (including the form of ADR) is filed as Exhibit [—] to the Registration Statement on Form F-1 (File No. 333-[—]) of which this prospectus forms a part. A copy of the form of ADR is also attached as an exhibit to the Registration Statement on Form F-6 (File No. 333-[—]) filed by Meridian Trust Company, National Association, as Depositary, under the Securities Act