Contract analysis

Section 1.1 — "Agreement" means this Administrative Settlement Agreement, including all recitals, articles, and sections hereof.

Section 1.2 — "BIS" means the Bureau of Industry and Security of the United States Department of Commerce.

Section 1.3 — "Company" means Halcyon Semiconductor Inc. and Halcyon Semiconductor AG, jointly and severally.

Section 1.4 — "Compliance Monitor" means the independent compliance monitor appointed pursuant to Article IV of this Agreement.

Section 1.5 — "Effective Date" means the date of the last signature affixed to this Agreement.

Section 1.6 — "Enhanced Compliance Period" means the period of three (3) years commencing on the Effective Date.

Section 1.7 — "Monitor Term" means the period of months commencing on the Effective Date . {C&H Note: DOJ draft had 24 months. Our negotiation position per the resolution-in-principle framework discussed at the February 18, 2026 session is 18 months. Added flexibility for Monitor start date — selection from DOJ-approved candidate list may take time, and we should not lose monitor-term runway to administrative delays

Section 1.8 — "Violations" has the meaning set forth in the recitals to this Agreement.

ARTICLE II — CIVIL MONETARY PENALTY

Section 2.1 — Penalty Amount. The Company shall pay a civil administrative penalty in the amount of Three Million Two Hundred Fifty Thousand Dollars ($3,250,000) (the "Penalty") to the United States.

Section 2.2 — Payment Terms. The Penalty shall be paid by wire transfer in immediately available funds to the within calendar days of the Effective Date. DOJ NSD/CES shall provide wire transfer instructions to the Company or its counsel no later than five (5) business days after the Effective Date. {C&H Note: DOJ proposed 30 days. We are requesting 60 days to allow for internal treasury approval processes at HSAG and

ARTICLE III — NO CRIMINAL PROSECUTION; NO DENIAL OF EXPORT PRIVILEGES {C&H Note: The entirety of Article III is new. It was not in DOJ's draft. These provisions are essential client requirements consistent with DOJ's oral commitments made during the resolution-in-principle discussions on February 18, 2026. We expect pushback on Section 3.1 (DOJ may want to limit the employee protection to "based on information known

ARTICLE IV — COMPLIANCE UNDERTAKINGS

Section 4.1 — Independent Compliance Monitor. (a) Monitor Selection. Within days of the Effective Date, the Company shall retain an independent compliance monitor (the "Compliance Monitor") selected from . DOJ NSD/CES shall provide the candidate list to the Company within fifteen (15) days of the Effective Date. In the event the Company objects to a candidate, DOJ NSD/CES shall propose a replacement candidate within

Section 4.2 — Annual Export Compliance Audits. During the Enhanced Compliance Period, the Company shall cause an annual audit of its export compliance program to be conducted by a qualified independent third party . Each audit shall assess the Company's compliance with the EAR and the terms of this Agreement. Written reports of each annual audit shall be provided to DOJ NSD/CES and the Company within days of the comp

Section 4.3 — Automated Restricted-Party Screening. automated restricted-party screening for all shipments of items classified under ECCN 3A001 (and any successor classification) to end users or consignees in the PRC, the Russian Federation, and all countries designated as EAR Country Group D:1 or D:5, . Such screening shall check all parties to each transaction — including end users, consignees, intermediate consign

Section 4.4 — Training. The Company shall provide mandatory export compliance training to all employees with sales, order processing, distribution, logistics, or compliance responsibilities involving end users or consignees in the PRC, the Russian Federation, and EAR Country Group D:1/D:5 countries. Such training shall be conducted , and shall cover, at a minimum, the Entity List, the Unverified List, the Denied Pers

Section 4.5 — Periodic Reporting. During the Enhanced Compliance Period, the Company shall provide written reports to DOJ NSD/CES. Each report shall include, at a minimum: (a) the status of compliance program enhancements undertaken by the Company; (b) any new potential EAR violations identified by the Company during the applicable reporting period, including a description of the circumstances of each potential viola

ARTICLE V — ADMISSIONS AND COOPERATION

Section 5.1 — Admissions. The Company admits that it committed the Violations as described in the recitals to this Agreement. {C&H Note: Essential. Without this carve-out, the general admission of Violations could be read to encompass Lansheng — particularly given that the recitals reference both Zhonghe and Lansheng. The carve-out creates an unambiguous textual firewall. This is a non-negotiable position.}

Section 5.2 — Ongoing Cooperation. The Company agrees to continue cooperating fully with DOJ NSD/CES in connection with any ongoing or future investigation arising from or relating to the conduct described in this Agreement, including making documents and witnesses available upon reasonable request by DOJ NSD/CES. {C&H Note: Standard cooperation-obligation limitations. DOJ's draft had an unqualified cooperation claus

ARTICLE VI — BREACH AND REMEDIES

Section 6.1 — Notice and Cure. If DOJ NSD/CES determines that the Company has materially breached any term or condition of this Agreement, DOJ NSD/CES shall provide written notice to the Company specifying the nature of the alleged breach in reasonable detail. The Company shall have calendar days from receipt of such notice to cure the breach (the "Cure Period"). If the Company believes in good faith that the alleged

Section 6.2 — Remedies for Uncured Breach. If, following the expiration of the Cure Period, DOJ NSD/CES determines in good faith that a material breach has not been cured, DOJ NSD/CES may, at its sole discretion, pursue one or more of the following remedies: (a) extend the Enhanced Compliance Period by up to ; (b) extend the Monitor Term by up to months; (c) refer the matter for criminal prosecution . {C&H Note: (i)

Section 7.1 — Scope of Release. Upon the Company's full satisfaction of all terms and obligations of this Agreement, including payment of the Penalty in full and completion of the Enhanced Compliance Period, DOJ NSD/CES hereby releases and forever discharges the Company, together with its parents, subsidiaries, affiliates, and their respective current and former directors, officers, and employees acting in their capa

Section 7.2 — Release Carve-Outs. The release set forth in Section 7.1 does not extend to: (a) ; (b) any false statements made to, or obstruction of justice directed at, DOJ NSD/CES or any other governmental authority by the Company or its agents in connection with this Agreement or the Inquiry; or (c) any material breach of this Agreement by the Company that remains uncured as provided in Section 6.1. {C&H Note: DOJ

ARTICLE VIII — GENERAL PROVISIONS

Section 8.1 — Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the United States of America.

Section 8.2 — Entire Agreement. This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior negotiations, representations, understandings, and agreements, whether written or oral, between the parties relating to the subject matter of this Agreement.

Section 8.3 — Amendments. This Agreement may not be amended, modified, or supplemented except by a written instrument signed by all parties hereto.

Section 8.4 — Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute one and the same instrument. Execution and delivery of this Agreement by facsimile or electronic transmission (including PDF) shall be deemed effective as original execution and delivery.

Section 8.5 — Notices. All notices, requests, demands, and other communications required or permitted under this Agreement shall be in writing and shall be delivered by hand, by nationally recognized overnight courier, or by registered or certified mail, return receipt requested, postage prepaid, to the following addresses (or to such other address as a party may designate by written notice in accordance with this Se

Section 8.6 — Public Disclosure. {C&H Note: Critical addition. HSAG is listed on the Frankfurt Stock Exchange and is subject to ad-hoc disclosure obligations under MAR Article 17 and the German Securities Trading Act (WpHG). If DOJ issues a press release before HSAG issues its own ad-hoc disclosure (Ad-hoc-Mitteilung), the Company could face a separate regulatory violation in Germany (BaFin enforcement), potential se

Section 8.7 — No Third-Party Beneficiaries. This Agreement is not intended to, and does not, confer any rights or benefits on any person or entity other than the parties hereto. No person or entity other than the parties hereto may enforce any provision of this Agreement. SIGNATURE PAGE IN WITNESS WHEREOF, the parties hereto have executed this Administrative Settlement Agreement as of the dates set forth below. UNITE

1. Article III (entire) — No-prosecution, no-denial, no-OFAC-referral commitments. DOJ's draft contained no explicit commitment against criminal prosecution, denial of export privileges, or OFAC referral. The entirety of Article III is new and must be included in the final agreement. These provisions reflect DOJ's oral commitments during the resolution-in-principle discussions and are essential to the Company's willi

2. Lansheng carve-out (Recitals ¶ 4 + Art. V § 5.1 + Art. VII § 7.1). The Company cannot admit to any violation regarding Lansheng. Our investigation found no basis for a § 744.21 military end-use violation. The carve-out must appear in three places: (i) the recitals, to establish that the Agreement does not include findings on Lansheng; (ii) Section 5.1, to create an explicit non-admission; and (iii) Section 7.1, to

3. Public disclosure advance notice (Art. VIII § 8.6). HSAG's MAR Article 17 obligations require this. A DOJ press release issued without advance notice could trigger a separate German regulatory violation. The five-business-day advance notice period is the minimum necessary. This is a legal compliance necessity, not a preference.

4. Monitor term: 18 months, not 24. Consistent with the resolution-in-principle framework. An 18-month term is proportionate to the nature and number of Violations (three shipments, non-willful, promptly remediated). Twenty-four months is appropriate only for willful or systemic violations. Priority Redlines (Strongly Preferred But Negotiable)

5. Payment term: 60 days. Preferred position is 60 days; could accept 45 days. Cannot accept 30 days due to HSAG Supervisory Board approval requirements and EUR/USD conversion logistics.

6. Semi-annual reporting. Preferred position is semi-annual throughout the Enhanced Compliance Period. Fallback: quarterly for the first year, semi-annual for years two and three.

7. Cooperation limitations (Art. V § 5.3). These are standard limitations that DOJ has accepted in comparable recent settlements. Expect DOJ to accept with minor modifications, possibly adding a clause requiring the Company to notify DOJ of any foreign-law impediment before asserting it.

8. Breach remedies caps (Art. VI § 6.2). Expect pushback on the deletion of additional monetary penalties (former subclause (c)). Fallback position: agree to reinstate a capped additional penalty provision (e.g., not to exceed 50% of the original Penalty), but only upon a finding of willful breach, and only after an opportunity to be heard. Expect DOJ to Push Back On • Deletion of penalty arithmetic (former § 2.4). D