Contract analysis

I. INTRODUCTORY PARAGRAPH Dear Members of the Board: Calderwood & Harkness LLP ("C&H" or "we") has been engaged by Solstice Biomedical Devices Ltd. ("SBD" or the "Company"), an Irish private company limited by shares (Companies Registration Office ("CRO") No. 587241), to render this should-level tax opinion in connection with the proposed migration of certain intellectual property assets from Solstice Medical Technol

II. OPINION STANDARD This opinion is rendered at the "should" level. As used herein, the term "should" means that, in our professional judgment, each tax position described in this opinion is one that "should" be sustained on its merits if properly raised and challenged by the applicable taxing authority — that is, we believe there is a greater than fifty percent (50%) likelihood that each such position would be sust

III. SCOPE OF OPINION This opinion addresses the following United States federal income tax and Irish tax issues arising from the Transaction:

1. IRC § 367(d) — Outbound Transfer of Intangible Property. The application of Section 367(d) of the Internal Revenue Code of 1986, as amended (the "Code" or "IRC"), to the outbound transfer of the intellectual property portfolio (the "IP Portfolio") from SMT Inc. to SIP Holdings, including the availability of the useful-life election under Treasury Regulations Section 1.367(d)-1T(c)(3).

2. IRC § 482 — Arm's-Length Pricing. The arm's-length pricing of the IP transfer and the license-back royalty rate under Section 482 of the Code, including the "commensurate with income" standard applicable to transfers of intangible property.

3. IRC § 951A — Global Intangible Low-Taxed Income (GILTI). The GILTI implications with respect to royalty income earned by SIP Holdings and the availability (or unavailability) of the high-tax exclusion and the Section 250 deduction.

4. IRC § 952 — Subpart F Income. The Subpart F implications regarding potential characterization of royalty income as foreign personal holding company income under Section 954(c) of the Code.

5. IRC § 59A — Base Erosion and Anti-Abuse Tax (BEAT). The BEAT implications with respect to royalty payments from SMT Inc. to SIP Holdings, including calculation of the base erosion percentage.

6. US-Ireland Income Tax Treaty — Article 12 (Royalties). The withholding tax treatment of royalty payments under Article 12 of the Convention between the Government of the United States of America and the Government of Ireland for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital Gains (the "Treaty" or the "US-Ireland Income Tax Treaty"), including the

7. Section 291A TCA 1997 — Irish Capital Allowances. The qualification of the IP Portfolio for capital allowances (wear and tear allowances) under Section 291A of the Taxes Consolidation Act 1997 ("TCA 1997") as a "specified intangible asset."

8. Irish Transfer Pricing Compliance. Compliance with Irish transfer pricing rules as amended by the Finance Act 2019, as they apply to the intercompany IP transfer, the license-back arrangement, the intercompany loan, and the cost-plus R&D services agreement. This opinion does not address state or local tax consequences in any United States jurisdiction, nor does it address non-US tax consequences other than the Iri

IV. SUMMARY OF THE TRANSACTION A. The Parties

1. Solstice Biomedical Devices Ltd. (SBD) Solstice Biomedical Devices Ltd. is an Irish private company limited by shares, registered with the Companies Registration Office under CRO No. 587241. SBD's registered office is located at Unit 14, Corrib Technology Park, Headford Road, Galway, H91 XR72, Ireland. SBD's principal business activity is the design, manufacture, and distribution of minimally invasive cardiac cath

2. Solstice Medical Technologies Inc. (SMT Inc.) Solstice Medical Technologies Inc. is a Delaware C-corporation with EIN 84-3291507 and Delaware Secretary of State File No. 7482916. SMT Inc.'s principal office is located at 2200 Biopharma Drive, Suite 300, Waltham, Massachusetts 02451. SMT Inc. is a wholly-owned subsidiary of SBD and is the current holder of the IP Portfolio that is the subject of this Transaction. S

3. Solstice IP Holdings Designated Activity Company (SIP Holdings) Solstice IP Holdings Designated Activity Company is an Irish designated activity company, registered with the Companies Registration Office under CRO No. 714538. SIP Holdings' registered office is located at Unit 14, Corrib Technology Park, Headford Road, Galway, H91 XR72, Ireland. SIP Holdings was incorporated on January 18, 2024, and has an authoriz

V. DOCUMENTS AND MATERIALS REVIEWED In connection with the preparation of this opinion, we have reviewed the following documents and materials (collectively, the "Reviewed Materials"):

1. Draft intellectual property valuation report prepared by Whitmore Valuation Advisors LLC, dated January 29, 2024, project reference WVA-2023-1187, authored by Marcus Whitmore, ASA, Managing Director.

2. Intercompany debt pricing analysis prepared by Whitmore Valuation Advisors LLC, in which WVA benchmarked the 3.75% fixed interest rate on the €180.0 million intercompany loan from SBD to SIP Holdings.

3. Factual Assumptions and Representations Letter from SBD to C&H, dated March 8, 2024, executed by Fiona Gallagher, Chief Financial Officer, and Dr. Cathal Morrissey, Chief Executive Officer (the "Factual Assumptions and Representations Letter" or the "Representations Letter").

4. Certificate of Incorporation and CRO filings for Solstice IP Holdings Designated Activity Company (CRO No. 714538; date of incorporation: January 18, 2024).

5. Draft IP Assignment Agreement by and between Solstice Medical Technologies Inc., as transferor, and Solstice IP Holdings DAC, as transferee, setting forth the terms of the transfer of the IP Portfolio for a purchase price of $214.5 million.

6. Draft License-Back Agreement by and between Solstice IP Holdings DAC, as licensor, and Solstice Medical Technologies Inc., as licensee, providing for an exclusive license for North America at a royalty rate of 8.0% of net sales.

7. Draft Rest-of-World License Agreements by and between Solstice IP Holdings DAC, as licensor, and various group entities, as licensees, providing for royalty rates ranging from 4.0% to 6.5% of net sales depending on territory.

8. Draft Cost-Plus R&D Services Agreement by and between Solstice Medical Technologies Inc., as service provider, and Solstice IP Holdings DAC, as service recipient, providing for compensation at cost plus an 8.0% mark-up.

9. Intercompany loan term sheet for the €180.0 million loan from SBD to SIP Holdings (3.75% fixed annual interest rate, 10-year term maturing March 1, 2034, interest-only payments for years 1–3, equal annual principal installments of approximately €25.71 million commencing year 4).

10. SBD consolidated audited financial statements for FY2023, audited by Pemberton Hale LLP (lead audit partner: Aisling Brennan).

11. SMT Inc. United States federal income tax returns and supporting schedules for the most recently filed taxable year and relevant prior periods.

12. SMT Inc. financial statements and supporting documentation showing an adjusted tax basis in the IP Portfolio of $11.3 million and total FY2023 deductions of $174.8 million.

13. Organizational charts for the SBD group, including the ownership structure of SBD, SMT Inc., SIP Holdings, and other affiliated entities.

14. United States patent portfolio schedule listing the 47 granted US utility patents and 12 pending US patent applications comprising the IP Portfolio.

15. Board resolutions of SBD and approval from Pinnacle GEP III in connection with the Transaction.

16. Correspondence with Harrington & Cahill (Niamh O'Sullivan, Tax Partner) regarding Irish tax compliance matters arising from the Transaction, including the availability of Section 291A capital allowances.

17. Correspondence with Dalton Byrne & Partners (Séamus Dalton, Managing Partner) regarding Irish corporate law and intellectual property matters relevant to the Transaction.

18. Correspondence with Lattimore & Stern CPAs LLP (David Lattimore, CPA) regarding SMT Inc. United States tax compliance data, including confirmation of the $174.8 million total deductions figure used in the BEAT analysis. We have also reviewed such other documents, certificates, records, and materials as we have deemed necessary or appropriate for the purposes of rendering this opinion.

VI. FACTUAL ASSUMPTIONS AND REPRESENTATIONS This opinion relies upon the factual assumptions and representations set forth in the Factual Assumptions and Representations Letter dated March 8, 2024, signed by Fiona Gallagher (CFO) and Dr. Cathal Morrissey (CEO), copies of which are in our files, as well as the following additional assumptions, each of which we have assumed to be true, correct, and complete for purpose

1. The $214.5 million purchase price reflects the fair market value of the IP Portfolio as of December 31, 2023, as independently determined by Whitmore Valuation Advisors LLC using the income approach (Discounted cash flow methodology) with a weighted average cost of capital of 13.5%. We have assumed that the WVA valuation was prepared in accordance with generally accepted valuation standards and that the financial

2. The 8.0% royalty rate under the License-Back Agreement was independently benchmarked by WVA and reflects an arm's-length rate for comparable intellectual property licensing transactions involving medical device technology of a similar nature. The benchmarking analysis employed the comparable uncontrolled transaction method and the comparable profits method, and the selected royalty rate falls within the arm's-leng

3. The IP Portfolio has a remaining weighted-average useful life of 12.8 years, as determined by WVA based on the remaining patent terms, the expected commercial life cycle of the underlying technologies, and the anticipated pace of technological obsolescence in the minimally invasive cardiac device market.

4. SIP Holdings will have genuine substance in Ireland, including management and control exercised in Ireland by directors and employees with appropriate qualifications and authority, qualified personnel with technical and commercial expertise to oversee the management and exploitation of the IP Portfolio, and a real business purpose for acquiring and managing the IP that is not solely or predominantly tax-motivated.

5. The intercompany loan of €180.0 million from SBD to SIP Holdings at 3.75% fixed was priced on arm's-length terms, as confirmed by WVA's intercompany debt pricing analysis, which benchmarked the interest rate against comparable third-party lending arrangements involving borrowers of similar credit quality and loan characteristics.

6. SMT Inc.'s adjusted tax basis in the IP Portfolio is $11.3 million as of the date of the transfer, as reflected on SMT Inc.'s books and records and as confirmed by Lattimore & Stern CPAs LLP.

7. SMT Inc.'s FY2023 total deductions are $174.8 million, as confirmed by Lattimore & Stern CPAs LLP (David Lattimore, CPA). We have not independently audited or verified this figure.

8. The Transaction documents — including the IP Assignment Agreement, the License-Back Agreement, the Rest-of-World License Agreements, the Cost-Plus R&D Services Agreement, and the intercompany loan agreement — will be executed and consummated substantially in the form reviewed by C&H and summarized herein, without material modification.

9. No material change in applicable law — whether legislative, regulatory, administrative, or judicial — will occur between the date of this opinion and the closing and consummation of the Transaction.

10. All parties to the Transaction will comply with their respective reporting and filing obligations under applicable US and Irish tax law, including (without limitation) the filing of required information returns, treaty-based return position disclosures, and transfer pricing documentation.

11. SIP Holdings qualifies as a holder of "specified intangible assets" within the meaning of Section 291A of TCA 1997, and the IP Portfolio, when acquired by SIP Holdings, will constitute "specified intangible assets" eligible for capital allowances under that provision.

12. Board approval from Pinnacle GEP III was duly obtained in accordance with SBD's shareholders' agreement and constitutional documents, as the aggregate value of the Transaction exceeds the €10 million threshold for material intercompany transactions requiring prior approval from the holders of a majority of SBD's share capital. We expressly note that if any of the foregoing factual assumptions or representations i

VII. DISCUSSION AND ANALYSIS A. IRC § 367(d) — Outbound Transfer of Intangible Property

1. General Rule. Section 367(d) of the Code addresses the United States federal income tax consequences of an outbound transfer of intangible property by a United States person to a foreign corporation. Under Section 367(d), when a United States person transfers "intangible property" (as defined in Section 936(h)(3)(B) of the Code) to a related foreign corporation in an exchange described in Sections 332, 351, 354, 3

2. Application to the Transaction. The transfer of the IP Portfolio from SMT Inc. (a United States C-corporation and thus a "United States person" within the meaning of Section 7701(a)(30) of the Code) to SIP Holdings (a related Irish designated activity company and thus a "foreign corporation" within the meaning of Section 7701(a)(5) of the Code) constitutes an outbound transfer of intangible property within the mea

3. Opinion. Based on the foregoing analysis and subject to the assumptions, qualifications, and limitations set forth herein, it is our opinion at the should level that: (a) The outbound transfer of the IP Portfolio from SMT Inc. to SIP Holdings should trigger deemed annual royalty inclusions to SMT Inc. under IRC § 367(d), calculated based on the $203.2 million built-in gain and spread over the remaining useful life

1. General Rule. Section 482 of the Code authorizes the Secretary of the Treasury to distribute, apportion, or allocate gross income, deductions, credits, or allowances among two or more organizations, trades, or businesses (whether or not incorporated, whether or not organized in the United States, and whether or not affiliated) owned or controlled directly or indirectly by the same interests, if the Secretary deter

2. Application to the Transaction. The $214.5 million purchase price for the IP Portfolio was independently determined by WVA using the income approach (Discounted cash flow methodology) as of December 31, 2023. The WVA valuation employed a WACC of 13.5%, which reflects the risk-adjusted cost of capital appropriate for a portfolio of medical device intellectual property of this nature. We have reviewed the WVA valuat

3. Opinion. Based on the foregoing analysis and subject to the assumptions, qualifications, and limitations set forth herein, it is our opinion at the should level that: (a) The $214.5 million purchase price for the IP Portfolio and the 8.0% royalty rate under the License-Back Agreement should satisfy the arm's-length standard under IRC § 482. (b) The "commensurate with income" standard should be met based on the WVA

1. General Rule. Section 951A of the Code, enacted as part of the Tax Cuts and Jobs Act of 2017, requires each United States shareholder (as defined in Section 951(b)) of a controlled foreign corporation ("CFC") (as defined in Section 957(a)) to include in gross income for each taxable year its "GILTI inclusion amount." The GILTI inclusion amount is determined as the excess of the US shareholder's pro rata share of t

2. Application to the Transaction. SIP Holdings is a CFC for purposes of Section 957(a) of the Code, as it is 100% owned by SBD. Whether a GILTI inclusion is required depends on whether there are "United States shareholders" within the meaning of Section 951(b) who hold directly, indirectly, or constructively at least 10% of the voting power or value of SIP Holdings. SBD is itself an Irish company and is not a United

3. Opinion. Based on the foregoing analysis and subject to the assumptions, qualifications, and limitations set forth herein, it is our opinion at the should level that: (a) Royalty income earned by SIP Holdings should constitute tested income for GILTI purposes under IRC § 951A, to the extent such income is not otherwise characterized as Subpart F income under IRC § 952. (b) GILTI inclusions should be required for U

1. General Rule. Under Section 952 of the Code, a US shareholder of a CFC must include in gross income its pro rata share of the CFC's "Subpart F income." Subpart F income is defined in Section 952(a) and includes, among other categories, "foreign base company income" as defined in Section 954(a). Foreign base company income, in turn, includes "foreign personal holding company income" ("FPHCI") as defined in Section

2. Application to the Transaction. The royalty income received by SIP Holdings from SMT Inc. under the License-Back Agreement constitutes royalties received from a related person. As such, this income facially falls within the definition of FPHCI under Section 954(c)(1)(A) of the Code. We have considered whether any exception to the FPHCI classification may apply: Active Trade or Business Exception. Under certain cir

3. Opinion. Based on the foregoing analysis and subject to the assumptions, qualifications, and limitations set forth herein, it is our opinion at the should level that: (a) The royalty income received by SIP Holdings from SMT Inc. under the License-Back Agreement should be characterized as foreign personal holding company income under IRC § 954(c)(1)(A), unless an applicable exception applies. (b) The Section 954(c)