Contract analysis

I. Executive Summary and Purpose This memorandum has been prepared by Calderwood & Harkness LLP ("C&H"), as United States securities counsel to Halcyon Semiconductor Aktiengesellschaft ("Halcyon," "HSAG," or the "Company"), in coordination with Bähr Stein Rechtsanwälte PartGmbB ("Bähr Stein"), German legal counsel to Halcyon, to analyze the requirements under the German Stock Corporation Act (Aktiengesetz, "AktG") fo

II. Background on Halcyon's Corporate Structure A. Entity Overview Halcyon Semiconductor Aktiengesellschaft is a German public stock corporation (Aktiengesellschaft) organized and existing under the laws of the Federal Republic of Germany. The Company's registered seat (Sitz) is Munich, Bavaria, and it is registered in the Commercial Register (Handelsregister) of the Local Court (Amtsgericht) of Munich under registra

III. Proposed Share Issuance — Parameters A. New Shares to Be Issued The Company proposes to issue 30,000,000 new ordinary shares (Stückaktien) without par value as the primary component of the Offering. These 30,000,000 new ordinary shares will correspond to 15,000,000 ADSs at the established ratio of one (1) ADS to two (2) ordinary shares. Upon issuance, the new shares will be deposited with the German custodian ba

IV. Authorized Capital (*Genehmigtes Kapital*) Under the *Aktiengesetz* A. Legal Framework — AktG §§ 202–206 The German Stock Corporation Act provides a mechanism through which a stock corporation may authorize its Management Board (Vorstand) to issue new shares without the need for a separate shareholder vote at the time of issuance. This mechanism, known as genehmigtes Kapital (authorized capital), is governed by S

Section 202(1) AktG — Authorization. The Satzung (articles of association) may authorize the Vorstand, with the consent (Zustimmung) of the Aufsichtsrat, to issue new shares up to a specified nominal amount (or, in the case of no-par-value shares, a specified number of shares) for a period not exceeding five years from the date of registration of the authorization. This authorization constitutes the genehmigtes Kapit

Section 202(2) AktG — Shareholder Approval. The authorization must be granted by the general meeting (Hauptversammlung) by a resolution passed with a majority of at least three-quarters (75%) of the share capital represented at the meeting at which the resolution is adopted. This supermajority requirement reflects the significance of the authorization, as it effectively delegates to the Vorstand the power to increase

Section 202(3) AktG — Maximum Limit. The authorized capital may not exceed fifty percent (50%) of the existing share capital at the time the authorization is registered in the commercial register. In the case of Halcyon, fifty percent of the 215,000,000 currently outstanding ordinary shares equals a maximum authorized capital of 107,500,000 shares. The proposed issuance of 30,000,000 new shares (or up to 36,420,000 s

Section 203 AktG — Utilization and Pre-Emptive Rights. When the Vorstand utilizes the authorized capital, the statutory provisions governing capital increases (including the pre-emptive rights provisions of Section 186 AktG) apply by analogy, unless the Satzung authorization expressly provides otherwise. This provision is of central importance for the proposed Offering because the new shares will be issued without pr

V. *Vorstand* (Management Board) Resolution A. AktG Requirements Under Section 204 of the AktG, the utilization of authorized capital to issue new shares requires the adoption of a formal resolution by the Vorstand (Vorstandsbeschluss). The Vorstand resolution must determine the material terms and conditions of the issuance, including the following: (a) the number of new shares to be issued; (b) the issue price (Ausg

VI. *Aufsichtsrat* (Supervisory Board) Consent A. AktG Requirements

Section 204(1) of the AktG requires that the issuance of new shares under authorized capital receive the consent (Zustimmung) of the Aufsichtsrat. This consent is a mandatory prerequisite for the validity of the capital increase and cannot be waived. The Aufsichtsrat consent must also specifically cover the exclusion of pre-emptive rights if the Vorstand resolution provides for such exclusion, as is the case in the p

VII. Exclusion of Pre-Emptive Rights (*Bezugsrechtsausschluss*) A. Statutory Pre-Emptive Rights — AktG § 186 Under Section 186(1) of the AktG, existing shareholders of a German stock corporation have a statutory pre-emptive right (Bezugsrecht) to subscribe for new shares in any capital increase in proportion to their existing shareholdings. This right is designed to protect existing shareholders from dilution of thei

1. Authorization in the *Satzung*. As a threshold matter, the Genehmigtes Kapital 2025 authorization in the Satzung must expressly empower the Vorstand, with the consent of the Aufsichtsrat, to exclude pre-emptive rights in connection with the issuance of new shares under the authorized capital. This authorization must be of sufficient scope to cover the proposed issuance of up to 36,420,000 new shares without pre-em

2. Simplified Exclusion (*Erleichterter Bezugsrechtsausschluss*) — § 186(3) Sentence 4 AktG. German law provides a streamlined mechanism for the exclusion of pre-emptive rights known as the simplified exclusion (erleichterter Bezugsrechtsausschluss) under Section 186(3) sentence 4 of the AktG. Under this provision, pre-emptive rights may be excluded for a cash capital increase if two conditions are simultaneously met

3. General Exclusion — Substantive Justification (*Sachliche Rechtfertigung*). For the portion of the issuance that cannot be covered by the simplified exclusion (or if the Satzung authorization provides for a general exclusion covering the entire issuance), the exclusion of pre-emptive rights must be objectively justified (sachlich gerechtfertigt) in the interest of the Company. This requirement derives from the con

VIII. Shareholder Approval Requirements A. No Further *Hauptversammlung* Required (If Authorized Capital Sufficient) If the existing Genehmigtes Kapital 2025 authorization is sufficient in both amount (at least 36,420,000 shares remaining available) and scope (including a pre-emptive rights exclusion authorization covering the proposed issuance), no further shareholder approval by the Hauptversammlung is required for

IX. Issue Price Considerations A. Minimum Issue Price — AktG § 9

Section 9(1) of the AktG establishes the minimum issue price for shares of a German stock corporation. For Stückaktien (no-par-value shares), the minimum issue price is the pro rata amount of the share capital (Grundkapital) attributable to each share, calculated by dividing the total registered share capital by the number of outstanding shares. Shares may not be issued below this statutory minimum under any circumst

X. Commercial Register Filings and Effectiveness A. Capital Increase Registration Under Section 203(1) in conjunction with Sections 188 and 189 of the AktG, a capital increase — including a capital increase under authorized capital — becomes effective only upon registration (Eintragung) of the implementation of the capital increase (Durchführung der Kapitalerhöhung) in the Commercial Register (Handelsregister) at the