Contract analysis

1. US Holders — Definition As used in this summary, the term "US Holder" means a beneficial owner of ADSs that is, for United States federal income tax purposes: (a) an individual who is a citizen or resident of the United States; (b) a corporation (or other entity treated as a corporation for United States federal income tax purposes) created or organized in or under the laws of the United States, any state thereof,

2. Treatment of ADSs as Ordinary Shares for US Federal Income Tax Purposes For United States federal income tax purposes, a holder of ADSs will generally be treated as the owner of the underlying Ordinary Shares represented by those ADSs. As noted above, each ADS represents two (2) Ordinary Shares (Stammaktien) of Halcyon, nominal value €1.00 per share. References in this summary to ADSs also include the Ordinary Sha

3. US Federal Income Tax Consequences — Distributions on ADSs 3.1 General Treatment of Distributions Subject to the discussion under "— Passive Foreign Investment Company Considerations" below, distributions of cash or property paid on the Ordinary Shares underlying ADSs (including amounts withheld to pay German withholding tax, as described under "— German Tax Considerations — Withholding Tax on Dividends" below) wi

4. German Tax Considerations — Withholding Tax on Dividends 4.1 German Statutory Withholding Under German tax law, dividends paid by a German corporation such as Halcyon to non-resident shareholders are subject to German withholding tax (Kapitalertragsteuer) at a rate of 25% of the gross amount of the dividend (before deduction of any tax), plus a 5.5% solidarity surcharge (Solidaritätszuschlag) imposed on the amount

5. US Foreign Tax Credit Considerations 5.1 General Rules Subject to certain limitations and conditions (including the election described in Section 5.3 below), German withholding tax withheld at the applicable Treaty rate (i.e., at a rate not in excess of 15% of the gross dividend amount) on dividends paid on the ADSs may be creditable against a US Holder's United States federal income tax liability. The foreign tax

6. Passive Foreign Investment Company (PFIC) Considerations 6.1 General PFIC Rules Special and generally unfavorable United States federal income tax rules apply to US persons who own stock (including ADSs) in a passive foreign investment company ("PFIC"). A foreign corporation is classified as a PFIC for any taxable year if either: (a) Income Test: 75% or more of its gross income for the taxable year consists of "pa

7. Disposition of ADSs — US Federal Income Tax Consequences 7.1 Sale or Other Taxable Disposition Subject to the PFIC rules discussed above, a US Holder will generally recognize gain or loss on the sale, exchange, or other taxable disposition of ADSs in an amount equal to the difference between (a) the amount realized on the disposition (expressed in United States dollars) and (b) the US Holder's adjusted tax basis i

8. Additional German Tax Considerations 8.1 German Inheritance and Gift Tax Transfers of ADSs (or the underlying Ordinary Shares) by gift or upon the death of a holder may be subject to German inheritance and gift tax (Erbschaft- und Schenkungsteuer) under certain circumstances. Under German inheritance and gift tax law, such tax may apply where, among other cases, the decedent or donor, or the heir, donee, or other

9. Information Reporting and Backup Withholding 9.1 Information Reporting US Holders may be subject to information reporting requirements with respect to dividends paid on ADSs and the proceeds from the sale, exchange, or other disposition of ADSs. In general, information returns on IRS Form 1099-DIV (with respect to dividends) and IRS Form 1099-B (with respect to disposition proceeds) are required to be filed with t

10. Medicare Tax on Net Investment Income In addition to regular United States federal income tax, a US Holder that is an individual, estate, or trust is generally subject to a 3.8% tax (the "Medicare Contribution Tax") on the lesser of: (i) the US Holder's "net investment income" (or, in the case of an estate or trust, "undistributed net investment income") for the taxable year; and (ii) the excess of the US Holder'

11. Closing Disclaimer and Advice to Consult Tax Advisors The foregoing discussion is a general summary and does not purport to be a complete analysis of all potential United States federal income tax and German tax consequences of acquiring, holding, and disposing of ADSs. This discussion does not address United States state and local tax consequences, the tax laws of jurisdictions other than the United States and t