MEMORANDUM
PRIVILEGED & CONFIDENTIAL / ATTORNEY-CLIENT COMMUNICATION / ATTORNEY WORK PRODUCT
To: Dr. Friedrich Wendt, Vorstandsvorsitzender; Katarina Dalmqvist, Finanzvorstand; Wilhelm Ostermann, Chefjustitiar — Halcyon Semiconductor Aktiengesellschaft
From: Vivienne St. Claire, Partner; Claire Dempsey, Associate — Calderwood & Harkness LLP
Date: February 5, 2026
Re: ADR Structure and Level III Program Requirements — Halcyon Semiconductor AG Prospective US Listing
Matter No.: 1032-00003
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I. Executive Summary
The purpose of this memorandum is to advise Halcyon Semiconductor Aktiengesellschaft ("Halcyon" or the "Company") on the structure, regulatory framework, and operational requirements for establishing a Level III American Depositary Receipt ("ADR") program in connection with Halcyon's planned initial public offering ("IPO") of American Depositary Shares ("ADSs") in the United States. This memorandum has been prepared at the request of Dr. Friedrich Wendt and is intended for use by the Vorstand and Chefjustitiar in evaluating the ADR structure in advance of the Company's organizational meeting with the underwriting syndicate, currently scheduled for February 24, 2026.
Our principal conclusions are as follows:
A Level III ADR program is the only ADR structure that permits a foreign private issuer to raise new capital in the US public markets through a registered public offering. Establishment of such a program requires full registration with the US Securities and Exchange Commission ("SEC") under both Form F-1 (for the public offering of ADSs and the underlying ordinary shares) and Form F-6 (for the depositary facility). Following the effectiveness of these registration statements and the consummation of the offering, Halcyon will become subject to ongoing reporting obligations under the Securities Exchange Act of 1934 (the "Exchange Act"), including the filing of annual reports on Form 20-F and current reports on Form 6-K. The Company must also comply with the listing standards of the target exchange, the Nasdaq Global Select Market ("Nasdaq GSM").
This memorandum provides a comprehensive comparison of all three levels of sponsored ADR programs, as well as unsponsored programs and Rule 144A/Regulation S private placement programs, and explains why a Level III program is required to achieve Halcyon's dual objectives of raising approximately $900,000,000 in gross proceeds and obtaining a Nasdaq listing. The memorandum further details the obligations of both the issuer and the proposed depositary bank, Meridian Trust Company, National Association ("Meridian Trust" or the "Depositary"), under the Deposit Agreement that will govern the ADR program, and addresses structuring considerations specific to Halcyon's dual-listed profile and the proposed offering structure.
The targeted gross proceeds for the offering are approximately $900,000,000 at the base deal size, with a proposed ADS price range of $39.00 to $45.00 per ADS. The proposed ADS ratio is 1 ADS representing 2 ordinary shares (Stammaktien) of Halcyon (the "1:2 Ratio"). If the underwriters exercise the overallotment option in full, maximum gross proceeds could reach approximately $1,034,812,600.
This memorandum should be read in conjunction with the companion memoranda being prepared by Calderwood & Harkness on the following related topics: (i) Foreign Private Issuer Status (Rule 3b-4 Analysis); (ii) Securities Act Registration on Form F-1 vs. Form F-6; (iii) Exchange Act Reporting Obligations Post-Listing; and (iv) other memoranda referenced in Section XI.C below.
II. Background
A. Halcyon Semiconductor AG — Overview
Halcyon Semiconductor Aktiengesellschaft is a German public stock corporation (Aktiengesellschaft, or "AG") incorporated and registered under the laws of the Federal Republic of Germany, with its registered office in Munich, Bavaria. The Company is registered in the Commercial Register (Handelsregister) of the Local Court (Amtsgericht) of Munich under registration number HRB 217458. Halcyon's headquarters are located at Maximilianstraße 72, 80539 Munich, Germany.
Halcyon designs and manufactures advanced power semiconductor devices based on silicon carbide ("SiC") and gallium nitride ("GaN") technologies. The Company's products serve the automotive, industrial, and renewable energy sectors, with key applications including electric vehicle drivetrain power modules, industrial motor drives, solar inverters, and wind power conversion systems. Founded in 1997, Halcyon has grown to employ approximately 8,400 employees worldwide, with manufacturing facilities in Munich, Dresden, and Villach, Austria, and design centers in Munich, Nuremberg, Shanghai, and San Jose, California.
Halcyon's ordinary shares (Stammaktien) are listed on the Frankfurt Stock Exchange under the ticker symbol "HCY" and are admitted to trading on the Prime Standard segment of the regulated market (regulierter Markt) of the Frankfurt Stock Exchange (Frankfurter Wertpapierbörse). As of January 10, 2026, the Company's market capitalization was approximately €8.6 billion.
The Company currently has 215,000,000 ordinary shares outstanding, each without par value (nennwertlose Stückaktien). The shares are in registered form (Namensaktien) and are held in global certificate form through Ashgrove Enterprises Banking AG, the German central securities depository.
For the fiscal year ended December 31, 2025 (unaudited), Halcyon reported revenue of approximately €3.82 billion and EBITDA of approximately €1.07 billion, representing an EBITDA margin of approximately 28.0%. These figures reflect strong growth in the SiC automotive segment, driven by increased electric vehicle adoption in Europe and Asia, and continued expansion in the industrial and renewable energy markets.
B. Proposed US Offering
Halcyon proposes to conduct an initial public offering of ADSs in the United States through a Level III ADR program. The ADSs will be listed on the Nasdaq Global Select Market under the proposed ticker symbol "HCYN." The offering is being structured as a combined primary and secondary offering, with the Company issuing new ordinary shares and certain existing shareholders selling a portion of their holdings.
Offering Composition. The base deal consists of 21,400,000 ADSs, divided as follows:
• Primary ADSs: 15,000,000 ADSs, each representing 2 newly issued ordinary shares, for a total of 30,000,000 new ordinary shares to be issued by the Company. At the proposed midpoint price of $42.00 per ADS, the primary component would generate gross proceeds of approximately $630,000,000.
• Secondary ADSs: 6,400,000 ADSs, each representing 2 existing ordinary shares, for a total of 12,800,000 existing ordinary shares to be sold by two selling shareholders:
• Rheintal Industrieholding GmbH ("Rheintal"): selling 8,500,000 ordinary shares, represented by 4,250,000 ADSs. Rheintal currently holds 47,945,000 ordinary shares, representing approximately 22.3% of the Company's outstanding share capital. Following the offering (assuming 245,000,000 shares outstanding after issuance of the primary shares and no exercise of the overallotment option), Rheintal will hold approximately 39,445,000 shares, or approximately 16.1% of the outstanding share capital.
• Kestrel Capital Partners AG ("Kestrel"): selling 4,300,000 ordinary shares, represented by 2,150,000 ADSs. Kestrel currently holds 20,855,000 ordinary shares, representing approximately 9.7% of the Company's outstanding share capital. Following the offering (under the same assumptions), Kestrel will hold approximately 16,555,000 shares, or approximately 6.8% of the outstanding share capital.
Overallotment Option. The underwriters will be granted an option (the "greenshoe" or overallotment option) to purchase up to 3,210,000 additional ADSs (representing 15% of the base deal), representing 6,420,000 underlying ordinary shares, exercisable within 30 days of pricing. If the overallotment option is exercised in full at the midpoint price of $42.00 per ADS, maximum gross proceeds would be approximately $1,033,620,000. At the top of the price range ($45.00 per ADS), maximum gross proceeds with full exercise of the greenshoe would be approximately $1,107,450,000.
Underwriting Syndicate. The offering will be managed by the following underwriting syndicate:
The gross underwriting spread is 3.50% of the public offering price per ADS. At the midpoint price of $42.00 per ADS, the per-ADS spread would be $1.47.
Depositary Bank. The proposed depositary bank for the ADR program is Meridian Trust Company, National Association, located at 101 Barclay Street, New York, NY 10286. The key contact at Meridian Trust is Patricia Novak, Vice President, Depositary Receipts.
Transfer Agent and Registrar. The proposed transfer agent and registrar for the ADSs is Crestfield Transfer Services Inc., located at 6201 15th Avenue, Brooklyn, NY 11219. The key contact at Crestfield is Angela Moretti, Director, Corporate Actions.
Registration. The offering will be registered under the Securities Act of 1933, as amended (the "Securities Act"), on Form F-1. Concurrently, the depositary facility will be registered on Form F-6 under the Securities Act. Halcyon intends to qualify as a "foreign private issuer" ("FPI") under Rule 3b-4 of the Exchange Act, which will afford the Company certain accommodations in its ongoing reporting and governance obligations. The FPI status analysis is the subject of a separate companion memorandum.
III. Overview of ADR Programs
A. What Is an ADR / ADS?
An American Depositary Receipt ("ADR") is a negotiable certificate issued by a US depositary bank that represents a specified number of shares (or fractional shares) of a non-US company. The underlying shares are deposited with, or held on behalf of, a custodian appointed by the depositary bank in the issuer's home country. The ADR itself is the physical or book-entry instrument evidencing the holder's interest; the underlying security represented by the ADR is the American Depositary Share ("ADS"). In practice, the terms "ADR" and "ADS" are often used interchangeably in market parlance, although they have distinct technical meanings. The ADS is the actual security that is traded on US markets, while the ADR is the certificate (or book-entry entitlement) evidencing ownership of the ADS.
The fundamental purpose of the ADR mechanism is to enable US investors to invest in non-US companies using US dollar-denominated instruments that are settled through the Depository Trust Company ("DTC"), the US central securities depository, without the need for the investor to open a foreign brokerage account, transact on a foreign stock exchange, or manage foreign currency settlement. ADRs thus remove many of the logistical and operational barriers that would otherwise impede US investor access to international equities.
In the case of Halcyon's proposed program, the depositary bank — Meridian Trust Company, N.A. — will hold, or cause to be held through a custodian appointed in Germany, the ordinary shares (Stammaktien) of Halcyon deposited into the program. The custodial infrastructure in Germany will coordinate with Ashgrove Enterprises Banking AG, the central securities depository for German-listed securities, to ensure the safekeeping and settlement of the deposited ordinary shares. Meridian Trust will issue ADSs against the deposited shares, and these ADSs will be registered on the Nasdaq Global Select Market and traded by US investors in US dollars, with settlement through DTC.
Each ADS represents a fixed number of underlying ordinary shares, as specified in the Deposit Agreement between the issuer and the depositary bank. In Halcyon's case, the proposed ratio is 1 ADS to 2 ordinary shares (the "1:2 Ratio"), meaning each ADS traded on Nasdaq will represent 2 Halcyon ordinary shares held by the German custodian.
B. Unsponsored ADR Programs
An unsponsored ADR program is established by one or more depositary banks without the formal participation, agreement, or consent of the foreign issuer whose shares are being deposited. Unsponsored programs may be initiated by a depositary bank in response to US investor demand for a particular foreign security. Multiple depositary banks may independently establish unsponsored ADR facilities for the same foreign issuer, potentially leading to multiple ADR programs for a single company's shares.
An unsponsored ADR program does not require SEC registration. The issuer may rely on the exemption from Exchange Act registration provided by Rule 12g3-2(b) (the information supply exemption), under which the issuer need only make publicly available in English, through electronic publication on its website or through an electronic information delivery system, the information that it makes public in its home country, files with foreign exchanges, or distributes to its security holders.
Under an unsponsored program, the issuer has no contractual relationship with the depositary bank, no control over the terms of the program, and no obligation to furnish information to the depositary bank or to ADS holders beyond its home-country disclosure obligations. The issuer does not select the depositary bank, does not negotiate the terms of the deposit agreement (which is typically a unilateral agreement between the depositary and the ADS holders), and does not control the fee schedule.
Suitability for Halcyon: An unsponsored ADR program is entirely unsuitable for Halcyon's purposes. It does not permit capital raising, does not result in an exchange listing, and provides the issuer with no control over the program. It is mentioned here solely for completeness and to distinguish it from the sponsored program structures discussed below.
C. Sponsored ADR Programs — Three Levels
All sponsored ADR programs involve a formal, contractual relationship between the foreign issuer and a single depositary bank. This relationship is memorialized in a Deposit Agreement, which sets forth the terms and conditions governing the issuance, transfer, cancellation, and administration of ADSs. The issuer selects the depositary bank, negotiates the terms of the Deposit Agreement, and participates actively in the establishment and ongoing administration of the program.
Sponsored ADR programs are categorized into three levels — Level I, Level II, and Level III — each representing an increasing degree of SEC registration, regulatory compliance, and market access. The key distinguishing features are summarized in the following table:
Each of these levels is discussed in detail in Section IV below.
D. Rule 144A / Regulation S Private Placement ADR Programs
In addition to the three levels of sponsored ADR programs described above, foreign issuers may also establish restricted ADR programs (sometimes referred to as "RADRs") for the private placement of ADSs to qualified investors. Under a Rule 144A program, ADSs are offered and sold only to "Qualified Institutional Buyers" ("QIBs") as defined in Rule 144A under the Securities Act. Under a Regulation S program, securities are offered and sold only to persons outside the United States in compliance with Regulation S under the Securities Act. These two exemptions are often used in combination.
Rule 144A/Regulation S ADR programs do not require registration with the SEC. The ADSs issued under such programs are "restricted securities" and may not be freely traded on a US national securities exchange. They are typically traded, if at all, on portal-type electronic trading platforms (such as the former PORTAL market) accessible only to QIBs, or in the over-the-counter market subject to transfer restrictions.
Suitability for Halcyon: A Rule 144A/Regulation S private placement program does not achieve Halcyon's core objectives. It would not result in a public listing on the Nasdaq Global Select Market, would not provide the visibility, liquidity, and benchmark pricing benefits of a public exchange listing, and would not provide access to the full universe of US institutional and retail investors. While Halcyon may consider a Regulation S concurrent offering outside the United States (as discussed in Section X.C below), the primary US offering must be conducted through a registered Level III program.
IV. Detailed Comparison of ADR Levels
This Section provides a detailed analysis of each of the three sponsored ADR program levels, discussing the regulatory requirements, advantages, disadvantages, and suitability for Halcyon's planned offering in each case.
A. Level I ADR Program
A Level I ADR program is the simplest and least burdensome form of sponsored ADR program. It is designed to establish a basic US trading presence for the issuer's securities without requiring SEC registration, Exchange Act reporting, or compliance with US exchange listing standards.
SEC Registration. A Level I program does not require registration of the ADSs under either the Securities Act or the Exchange Act. The issuer relies on the exemption from Exchange Act registration provided by Rule 12g3-2(b), which requires the issuer to furnish to the SEC electronically (through EDGAR or by posting on a publicly accessible website) any information that is material to an investment decision and that the issuer (i) makes public pursuant to the law of its country of incorporation, (ii) files with any stock exchange on which its securities are traded and which is made public by such exchange, or (iii) distributes to its security holders. This is commonly referred to as the "information supply exemption."
Securities Act Registration. No Form F-6 registration is required for a Level I program. The exemption from Securities Act registration is generally based on Section 3(a)(2) of the Securities Act (for depositary receipts issued by a national bank) or the availability of the Rule 12g3-2(b) pathway, depending on the specific structure.
Trading Venue. ADSs issued under a Level I program trade exclusively on the US over-the-counter ("OTC") market. They are not listed on any US national securities exchange, such as the New York Stock Exchange ("NYSE") or the Nasdaq Stock Market. OTC trading typically occurs through the Greaves & Co.'s platforms (OTCQX, OTCQB, or Pink markets), with limited liquidity and visibility compared to exchange-listed securities.
Exchange Act Reporting. A Level I issuer is not subject to the periodic reporting requirements of the Exchange Act. It does not file annual reports on Form 20-F, current reports on Form 6-K, or any other Exchange Act reports. Its only obligation is to maintain the information supply under Rule 12g3-2(b).
Capital Raising. Capital raising is not permitted under a Level I program. The program is established solely for the purpose of facilitating US trading of existing shares that are already in the secondary market. No new shares may be issued into the US market through a Level I program.
Disclosure Standard. The issuer is required to provide only home-country disclosure. There is no requirement to prepare financial statements in accordance with US Generally Accepted Accounting Principles ("US GAAP") or International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"), nor is there any requirement for a reconciliation to US GAAP.
Sarbanes-Oxley Act. The Sarbanes-Oxley Act of 2002 ("SOX") does not apply to Level I issuers because they are not reporting companies under the Exchange Act.
Corporate Governance. No US exchange corporate governance requirements apply, as the ADSs are not listed on any US exchange.
Advantages. A Level I program offers the lowest cost and regulatory burden of any sponsored ADR structure. It establishes a basic US trading presence, provides a mechanism for US investors to access the issuer's securities in US dollars settled through DTC, and can serve as a stepping-stone to a more comprehensive ADR program in the future.
Disadvantages. A Level I program does not permit capital raising, does not result in a listing on a US exchange, provides limited liquidity and investor visibility, and does not establish the issuer as a reporting company in the United States. OTC trading volumes are typically low, and the investor base is limited.
Conclusion as to Halcyon. A Level I ADR program is unsuitable for Halcyon's purposes. The Company's primary objective is to raise approximately $900 million of new capital (through a combination of primary and secondary sales) and to achieve a listing on the Nasdaq Global Select Market. A Level I program cannot accomplish either of these objectives. Moreover, the limited liquidity and visibility of an OTC-traded Level I program would not provide the institutional investor access and benchmark pricing that Halcyon seeks to establish through its US listing.
B. Level II ADR Program
A Level II ADR program represents a significant step up in regulatory commitment from a Level I program. It permits the listing of ADSs on a US national securities exchange, thereby providing the issuer with substantially greater liquidity and investor access. However, a Level II program does not permit capital raising.
SEC Registration. A Level II program requires registration of the depositary facility under the Securities Act through the filing of a registration statement on Form F-6. In addition, the ADSs must be registered under Section 12(b) of the Exchange Act in connection with their listing on a US exchange. This Exchange Act registration triggers full periodic reporting obligations.
Securities Act Registration. Form F-6 is the only Securities Act registration statement required. Because no capital is being raised, there is no requirement to file a Form F-1 or Form F-3 registration statement covering an offering of securities.
Trading Venue. ADSs issued under a Level II program are listed and traded on a US national securities exchange, such as the NYSE or the Nasdaq Global Select Market. Exchange listing provides significantly greater liquidity, transparency, and investor access compared to OTC trading.
Exchange Act Reporting. A Level II issuer is subject to the full reporting requirements of the Exchange Act, including the obligation to file an annual report on Form 20-F within four months after the end of each fiscal year, current reports on Form 6-K for material developments and interim financial information, and interactive data in XBRL format. The issuer must comply with Section 13(a) and Section 15(d) of the Exchange Act on an ongoing basis.
Capital Raising. Capital raising is not permitted under a Level II program. The program is established for the purpose of listing existing shares on a US exchange to facilitate secondary market trading. No new shares may be issued into the US market through a Level II program.
Disclosure Standard. A Level II issuer must comply with full SEC disclosure requirements. Financial statements must be prepared in accordance with IFRS as issued by the IASB (which does not require reconciliation to US GAAP, pursuant to the SEC's 2007 acceptance of IFRS financial statements from foreign private issuers) or in accordance with US GAAP. Financial statements must be audited by a firm registered with the Public Company Accounting Oversight Board ("PCAOB").
Sarbanes-Oxley Act. SOX is applicable to Level II issuers, as they are reporting companies under the Exchange Act. However, FPIs benefit from certain phase-in provisions and accommodations, as discussed in Section VIII.D below.
Corporate Governance. A Level II issuer must comply with the corporate governance standards of its listing exchange (NYSE or Nasdaq), subject to exemptions available to FPIs. Under Nasdaq Rule 5615(a)(3), an FPI may follow home-country governance practices in lieu of certain Nasdaq governance requirements, provided that it discloses the differences between its home-country practices and Nasdaq requirements.
Advantages. A Level II program provides the benefits of a US exchange listing, including enhanced liquidity, greater visibility among US institutional investors, and the establishment of reporting issuer status. The exchange listing creates a daily US-market price benchmark and facilitates inclusion in US indices and benchmark portfolios.
Disadvantages. A Level II program imposes the full regulatory and compliance burden of an Exchange Act reporting company — including Form 20-F filing, SOX compliance, and Nasdaq governance — without the benefit of capital raising. The costs of maintaining a Level II program are substantially higher than a Level I program, and the issuer does not receive the offsetting benefit of IPO proceeds.
Conclusion as to Halcyon. A Level II ADR program is unsuitable for Halcyon's purposes. Although a Level II program would achieve Halcyon's objective of obtaining a Nasdaq listing, it does not permit capital raising. Halcyon intends to issue 30,000,000 new ordinary shares (represented by 15,000,000 primary ADSs) to raise approximately $630,000,000 in primary capital, and to facilitate secondary sales of 12,800,000 existing shares (represented by 6,400,000 ADSs) by Rheintal and Kestrel. A Level II program cannot accommodate either the primary issuance or the secondary sales, as both constitute the offering and sale of securities in the United States and require Securities Act registration beyond Form F-6. Accordingly, a Level II program does not meet Halcyon's needs.
C. Level III ADR Program
A Level III ADR program is the most comprehensive form of sponsored ADR program and is the only ADR structure that permits a foreign private issuer to raise new capital in the US public markets through a registered public offering. It combines the exchange listing benefits of a Level II program with the ability to conduct a registered offering of new and/or existing securities.
SEC Registration. A Level III program requires dual registration with the SEC:
• Form F-1 (or Form F-3). A registration statement on Form F-1 under the Securities Act is required for the public offering of ADSs and the underlying ordinary shares. Form F-1 is the general-purpose registration form available to foreign private issuers that are registering securities for the first time or that do not yet meet the eligibility requirements for Form F-3. Form F-3 requires, among other things, at least 12 months of timely Exchange Act reporting history. Because Halcyon has no prior Exchange Act reporting history, Form F-1 is the appropriate form for the IPO registration statement.
• Form F-6. A separate registration statement on Form F-6 under the Securities Act is required to register the depositary facility — that is, the ADSs evidenced by ADRs issued by Meridian Trust. Form F-6 registers the right represented by the ADS (i.e., the depositary receipt mechanism) as a separate class of securities.
Trading Venue. ADSs issued under a Level III program are listed and traded on a US national securities exchange. In Halcyon's case, the ADSs will be listed on the Nasdaq Global Select Market under the proposed ticker symbol "HCYN."
Exchange Act Reporting. A Level III issuer is subject to the same full reporting obligations as a Level II issuer, including annual reports on Form 20-F, current reports on Form 6-K, Section 13(a)/15(d) compliance, and XBRL interactive data tagging. Additionally, the issuer must be mindful of beneficial ownership reporting considerations under Sections 13(d), 13(g), and 16 of the Exchange Act, noting that FPIs are exempt from the short-swing profit reporting and disgorgement requirements of Section 16.
Capital Raising. Capital raising is permitted under a Level III program. The issuer may offer and sell newly issued shares (a primary offering) and/or selling shareholders may offer and sell existing shares (a secondary offering) in a registered public offering in the United States. This is the critical distinction between Level II and Level III programs and is the reason that a Level III program is required for Halcyon's planned IPO.
Disclosure Standard. A Level III issuer must comply with the full SEC prospectus disclosure requirements applicable to Form F-1, including the requirements of Regulation S-K and the form-specific requirements of Form F-1. Financial statements must be prepared in accordance with IFRS as issued by the IASB (or US GAAP) and audited by a PCAOB-registered audit firm. Halcyon's auditors, Blackmere & Whitfield LLP / GmbH WPG, are registered with the PCAOB. The lead engagement partner is Dieter Kaufmann, Wirtschaftsprüfer, based in the firm's Munich office at Ganghoferstraße 29, 80339 Munich, and the PCAOB-registered partner responsible for the US aspects of the engagement is Graham Templeton, based in the firm's New York office at 7 Times Square, New York, NY 10036.
Sarbanes-Oxley Act. SOX applies to Level III issuers, as they become reporting companies under the Exchange Act upon effectiveness of the registration statement and listing. As an FPI, Halcyon will benefit from certain extended phase-in provisions. Most notably, the requirement for management's assessment of internal controls over financial reporting under SOX Section 404(a), and the related requirement for an attestation report from the independent auditor under SOX Section 404(b), will first apply to Halcyon for the fiscal year ending December 31, 2027 (i.e., the second annual report on Form 20-F to be filed after listing). The specific SOX compliance roadmap is the subject of a separate companion memorandum.
Corporate Governance. A Level III issuer must comply with the listing standards of its exchange, including the governance requirements of the Nasdaq Listing Rules. However, as an FPI, Halcyon may claim exemptions under Nasdaq Rule 5615(a)(3) for certain governance standards, substituting German home-country practices. Halcyon will be required to file a Corporate Governance Exemption Notice with Nasdaq identifying each Nasdaq governance rule from which it claims an exemption and describing the home-country practice followed in lieu of the Nasdaq rule. Common exemptions claimed by German FPIs include: the requirement for a majority of independent directors (German AG governance relies on the two-tier board structure with a Supervisory Board (Aufsichtsrat) and a Management Board (Vorstand)), the requirement for an independent compensation committee, and certain shareholder approval requirements.
Advantages. A Level III program provides full access to the US public capital markets, enabling the issuer to raise new capital through a registered public offering. It establishes an exchange listing that provides deep liquidity, broad visibility, and access to the full universe of US institutional and retail investors. The dual-listed profile (Frankfurt and Nasdaq) enhances the Company's global visibility, broadens the shareholder base, and creates a US-dollar-denominated trading benchmark. For Halcyon specifically, a Level III program enables primary capital raising of approximately $630,000,000 (at midpoint pricing) and secondary sales of approximately $270,000,000, for total gross proceeds of approximately $900,000,000 at the base deal size.
Disadvantages. A Level III program imposes the highest regulatory and compliance burden of any ADR structure. It requires full SEC registration and review of both Form F-1 and Form F-6, ongoing Exchange Act reporting, SOX compliance, Nasdaq governance compliance, and the establishment of a comprehensive capital markets compliance infrastructure. The costs associated with maintaining a Level III program — including legal, accounting, advisory, depositary, transfer agent, listing, insurance, and investor relations fees — are substantial, as discussed in Section VIII.F below. The SEC staff review process for the Form F-1 registration statement involves a potentially multi-round comment letter process that can extend the offering timeline.
Conclusion as to Halcyon. A Level III ADR program is the required and recommended structure for Halcyon's planned IPO. It is the only ADR program type that permits Halcyon to raise new capital in the US public markets and achieve a Nasdaq listing. The Level III program satisfies both of Halcyon's core objectives: (i) raising approximately $900 million in gross proceeds through a combination of primary and secondary offerings, and (ii) listing the ADSs on the Nasdaq Global Select Market to access the US investor base and establish a dual-listed profile.
D. Comparative Summary Table
The following table provides a side-by-side comparison of all ADR program types across key dimensions relevant to Halcyon's evaluation:
V. Why Level III Is Required for Halcyon's Planned Offering
Having set forth the structural features of each ADR program type in the preceding sections, we now explain in detail why a Level III program is the required structure for Halcyon's proposed US offering.
A. Capital Raising Objective
Halcyon's primary objective in pursuing a US listing is to raise new equity capital to fund the next phase of its growth strategy. The Company intends to issue 30,000,000 new ordinary shares, represented by 15,000,000 primary ADSs, to raise approximately $630,000,000 in gross primary proceeds (at the midpoint ADS price of $42.00). After deducting the underwriting discount of 3.50% ($22,050,000 on the primary component at midpoint) and estimated offering expenses (approximately $6,500,000), the Company expects to receive net primary proceeds of approximately $601,450,000.
Halcyon has identified the following planned uses for the net primary proceeds:
• $280,000,000 for the expansion of the Company's third silicon carbide fabrication facility ("Fab 3") in Dresden, Germany, which is expected to increase SiC wafer production capacity by approximately 40% by the end of 2028;
• $140,000,000 for research and development on next-generation gallium nitride power devices, including vertical GaN-on-GaN power transistors for high-voltage automotive and industrial applications;
• $100,000,000 for the repayment of a tranche of the Company's €500,000,000 revolving credit facility with Pinnacle Financial and Larkspur Trust Bank; and
• $87,950,000 for general corporate purposes and working capital, including potential acquisitions and strategic investments that may arise from time to time.
These capital allocation priorities reflect Halcyon's strategic plan as approved by the Vorstand and Aufsichtsrat in December 2025. The Fab 3 expansion, in particular, is a time-critical investment given the rapidly growing demand for SiC power semiconductors in the electric vehicle market, and the availability of US capital markets funding is a key enabler of this investment.
Only a Level III ADR program permits the offering and sale of newly issued shares in the US public markets through a registered offering. Neither a Level I nor a Level II program permits capital raising of any kind, and a Rule 144A/Regulation S program, while permitting private placement capital raising, would not achieve the public exchange listing and broad investor access that Halcyon requires.
B. Selling Shareholder Component
In addition to the primary offering, two existing shareholders — Rheintal Industrieholding GmbH and Kestrel Capital Partners AG — intend to sell a portion of their holdings in the offering. The inclusion of selling shareholders in an IPO is a common feature that provides liquidity to existing investors, signals confidence in the company's future (where selling shareholders retain substantial positions), and broadens the float available for trading.
Rheintal Industrieholding GmbH. Rheintal is a Munich-based industrial holding company that has been a shareholder of Halcyon since 2003. Rheintal currently holds 47,945,000 ordinary shares, representing approximately 22.3% of the Company's outstanding share capital. In the offering, Rheintal intends to sell 8,500,000 ordinary shares, represented by 4,250,000 ADSs. Following the offering (assuming 245,000,000 shares outstanding after issuance of the 30,000,000 primary shares and no exercise of the overallotment option), Rheintal will retain approximately 39,445,000 ordinary shares, representing approximately 16.1% of the outstanding share capital. Rheintal will thus remain a significant shareholder of Halcyon post-IPO.
Kestrel Capital Partners AG. Kestrel is a Glenrock Assurance-based private equity firm that acquired its stake in Halcyon in 2017 through a secondary purchase. Kestrel currently holds 20,855,000 ordinary shares, representing approximately 9.7% of the Company's outstanding share capital. In the offering, Kestrel intends to sell 4,300,000 ordinary shares, represented by 2,150,000 ADSs. Following the offering (under the same assumptions), Kestrel will retain approximately 16,555,000 ordinary shares, representing approximately 6.8% of the outstanding share capital.
The secondary component of the offering — 6,400,000 ADSs representing 12,800,000 existing ordinary shares — requires registration under the Securities Act, as the offer and sale of these shares to US investors constitutes a public offering of securities. The Level III ADR structure accommodates the secondary component within the same Form F-1 registration statement that covers the primary offering, with Rheintal and Kestrel identified as "selling shareholders" in the prospectus.
C. Exchange Listing Objective
Halcyon seeks a listing on the Nasdaq Global Select Market to access the deepest and most liquid pool of US technology and semiconductor investors. The Nasdaq GSM is the listing venue of choice for many global semiconductor companies, and a Nasdaq listing will position Halcyon alongside its US-listed peers — including companies such as ON Semiconductor, Aldermere Corporation, and Aldermere Corporation (which maintains its own Level II ADR program on the OTC market under the ticker IFNNY) — in a manner that is familiar and accessible to US institutional investors.
Only Level II and Level III ADR programs permit listing on a US national securities exchange. A Level I program permits only OTC trading, which would not provide the institutional liquidity, benchmark pricing, and index eligibility that Halcyon requires. Because Halcyon also needs to raise capital, and only a Level III program permits both capital raising and exchange listing, the Level III program is the sole structure that satisfies both objectives simultaneously.
D. Concurrent Listing Status
Following the IPO, Halcyon will maintain a dual listing: its ordinary shares will continue to trade on the Frankfurt Stock Exchange (FRA: HCY, Prime Standard), and its ADSs will trade on the Nasdaq Global Select Market (Nasdaq: HCYN). This dual-listed profile will enhance the Company's global visibility, broaden its investor base across European and US markets, and provide trading liquidity in both US dollars and euros across overlapping trading hours.
The dual listing will require careful coordination of the Company's disclosure obligations under both German securities law (including the requirements of the EU Market Abuse Regulation (MAR), the German Securities Trading Act (Wertpapierhandelsgesetz, "WpHG"), and Frankfurt Stock Exchange rules) and US federal securities law (including SEC reporting and Regulation FD requirements). Bähr Stein Rechtsanwälte, the Company's German legal counsel, is advising on the German regulatory aspects of the dual listing, while Calderwood & Harkness is advising on US securities law compliance. Coordination between the two firms will be critical to ensuring that the Company's disclosure practices satisfy the requirements of both jurisdictions without creating inconsistencies or inadvertent selective disclosure.
VI. Dual Registration Requirement: Form F-1 and Form F-6
As noted above, a Level III ADR program requires dual registration with the SEC: a registration statement on Form F-1 for the public offering, and a separate registration statement on Form F-6 for the depositary facility. This Section discusses each filing in detail and the coordination required between them.
A. Form F-1 Registration Statement
The Form F-1 registration statement is the primary Securities Act registration statement that will register the offering of ADSs (and the underlying ordinary shares) to the public. Form F-1 is available to any foreign private issuer that is registering securities under the Securities Act. It is the general-purpose registration form for FPIs — analogous to Form S-1 for domestic US registrants — and is used when the issuer is not yet eligible for the short-form registration statement on Form F-3.
Eligibility. Form F-3 is available only to FPIs that, among other requirements, have been subject to the Exchange Act reporting requirements for at least 12 months immediately preceding the filing date and have timely filed all required reports during that period. Because Halcyon has no prior Exchange Act reporting history, it is not eligible for Form F-3 for the IPO. Accordingly, Form F-1 is the appropriate registration form.
Prospectus Requirements. The Form F-1 requires a complete prospectus that must include, at a minimum, the following items:
• Cover page (including ADS price range, underwriters, and legends);
• Prospectus summary (business overview, offering summary, risk factor summary);
• Risk factors (material risks relating to the business, industry, offering, ADSs, dual listing, and regulatory environment);
• Use of proceeds (allocation of net proceeds from the primary offering);
• Capitalization and dilution (pre- and post-offering capitalization table; dilution analysis for new investors);
• Selected financial data (five-year selected financial data, to the extent available);
• Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) (for each period for which audited financial statements are included);
• Business description (comprehensive description of Halcyon's business, products, markets, competition, intellectual property, and regulatory environment);
• Management and corporate governance (directors, officers, management board, supervisory board, compensation);
• Principal and selling shareholders (ownership table showing pre- and post-offering holdings of major shareholders, including Rheintal and Kestrel);
• Related-party transactions;
• Description of share capital and Articles of Association (Satzung);
• Description of American Depositary Shares (terms of the Deposit Agreement, rights of ADS holders);
• Taxation (material US federal income tax and German tax consequences to US holders);
• Underwriting (terms of the underwriting agreement, lock-up, stabilization);
• Legal matters; and
• Financial statements.
Financial Statements. The Form F-1 must include three years of audited financial statements prepared in accordance with IFRS as issued by the IASB. For Halcyon, this will include audited consolidated financial statements for the fiscal years ended December 31, 2023 (revenue: €3,214 million), December 31, 2024 (revenue: €3,508 million), and December 31, 2025 (revenue: €3,820 million). These financial statements are being audited (or, in the case of FY2023 and FY2024, have been audited) by Blackmere & Whitfield LLP / GmbH WPG, which is registered with the PCAOB.
Overallotment Option. The Form F-1 will also register the shares underlying the overallotment option — up to 3,210,000 additional ADSs representing up to 6,420,000 additional ordinary shares — to be issued and sold upon exercise of the option by the underwriters within 30 days of pricing.
SEC Staff Review Process. The Form F-1 will be subject to review by the SEC's Division of Corporation Finance. We anticipate the following timeline for the SEC review process, subject to adjustment based on the complexity and volume of SEC staff comments:
Halcyon, as an FPI, is eligible to submit a confidential draft registration statement to the SEC under the JOBS Act (as extended to FPIs by SEC staff guidance) or pursuant to Regulation S-K Item 1601. This confidential submission process allows the Company to begin the SEC review process without publicly disclosing the offering, providing the Company with flexibility to withdraw or delay the offering if market conditions or other factors warrant. The Form F-1 must be publicly filed at least 15 days before the commencement of the roadshow.
A more detailed discussion of the Form F-1 registration process, including the specific disclosure requirements and anticipated SEC staff comment areas, is provided in our separate companion memorandum on Securities Act Registration on Form F-1 vs. Form F-6.
B. Form F-6 Registration Statement
In addition to the Form F-1, a separate registration statement on Form F-6 is required under the Securities Act to register the ADSs evidenced by ADRs issued by Meridian Trust Company, N.A. While the Form F-1 registers the offering of the underlying ordinary shares (in ADS form), the Form F-6 registers the depositary facility itself — that is, the depositary receipt mechanism and the ADS as a class of securities.
Filing Responsibility. The Form F-6 is filed by the depositary bank (Meridian Trust Company, N.A.) as the registrant, because it is the depositary that issues the ADSs. However, in practice, the Form F-6 is typically prepared by issuer's counsel — in this case, Calderwood & Harkness LLP — in coordination with the depositary and its counsel. Audrey Zhou, a working associate in our Capital Markets group, has been assigned to lead the drafting of the Form F-6 and the underlying Deposit Agreement.
Key Exhibits. The principal exhibits to the Form F-6 include:
• The Deposit Agreement among Halcyon, Meridian Trust, and all ADS holders and beneficial owners;
• The form of American Depositary Receipt;
• An opinion of counsel as to the legality of the ADSs; and
• Such other exhibits as may be required by the form instructions.
Effectiveness. Form F-6 registration statements are typically subject to automatic effectiveness provisions, meaning that the Form F-6 may become effective upon filing or shortly thereafter, provided that all requirements are satisfied. However, the timing of Form F-6 effectiveness must be coordinated with the effectiveness of the Form F-1, because ADSs may not be issued and sold to the public until both registration statements are effective.
Filing Sequence. The Form F-6 is typically filed concurrently with, or shortly before, the date on which the Form F-1 is declared effective by the SEC. In some cases, the Form F-6 is filed earlier in the process to allow time for any SEC staff review, although Form F-6 filings are generally straightforward and attract fewer comments than Form F-1 filings.
C. Coordination Between Form F-1 and Form F-6
The two registration statements — Form F-1 and Form F-6 — are distinct filings with separate registration numbers and separate SEC review tracks. However, they are closely interconnected and must be carefully coordinated to ensure consistency and completeness.
Consistency of Deposit Agreement Description. The Deposit Agreement filed as an exhibit to the Form F-6 must be consistent in all material respects with the description of the ADSs and the Deposit Agreement included in the Form F-1 prospectus. The prospectus will include a detailed summary of the terms of the ADSs (typically under the heading "Description of American Depositary Shares"), which is essentially a plain-language summary of the Deposit Agreement. Any inconsistency between the actual Deposit Agreement and the prospectus description would be a material deficiency.
Cross-Referencing. The Form F-1 will cross-reference the Form F-6 (and vice versa) to the extent permitted by SEC rules. The Form F-1 prospectus will note that the ADSs are registered on Form F-6 filed with the SEC.
EDGAR Filing. Both registration statements must be filed electronically through the SEC's EDGAR system. Halcyon will need to obtain a Central Index Key ("CIK") number from the SEC before filing. The CIK application will be submitted as part of the pre-filing process. The CIK number is: to be determined upon filing.
Staffing. Calderwood & Harkness is responsible for the preparation of both the Form F-1 and the Form F-6, with Vivienne St. Claire serving as lead partner on the overall engagement, Claire Dempsey serving as lead associate on the Form F-1, and Audrey Zhou serving as lead associate on the Form F-6 and Deposit Agreement.
VII. The Deposit Agreement — Key Terms and Structure
The Deposit Agreement is the foundational legal document governing the Level III ADR program. It establishes the contractual framework for the issuance, transfer, cancellation, and administration of ADSs, and defines the rights and obligations of the issuer, the depositary bank, and the ADS holders. This Section summarizes the key terms and structural features of the Deposit Agreement that will govern Halcyon's ADR program. The actual Deposit Agreement will be negotiated between Halcyon, Meridian Trust, and their respective counsel, and will be filed as an exhibit to the Form F-6.
A. Parties to the Deposit Agreement
The Deposit Agreement will be entered into among the following parties:
• Issuer: Halcyon Semiconductor Aktiengesellschaft, a German stock corporation (Aktiengesellschaft) incorporated and registered in Munich, Bavaria.
• Depositary: Meridian Trust Company, National Association, a national banking association organized under the laws of the United States, with its principal office at 101 Barclay Street, New York, New York 10286.
• ADS Holders and Beneficial Owners: All persons who from time to time hold ADSs issued under the program, whether as registered holders of record on the books of the Depositary (or the transfer agent on its behalf) or as beneficial owners holding through a broker, nominee, or other intermediary, including through DTC.
Although the Deposit Agreement is a three-party agreement, ADS holders are not signatories. Rather, they become bound by the terms of the Deposit Agreement by accepting or acquiring ADSs, as set forth in the agreement's terms.
B. Governing Law
The Deposit Agreement will be governed by and construed in accordance with the laws of the State of Delaware, without regard to its conflict-of-laws principles. This is the prevailing market practice for deposit agreements governing ADR programs, as Delaware law provides a well-developed body of corporate and commercial law, certainty of interpretation, and consistency with the expectations of US depositary banks and institutional investors.
Jurisdiction for disputes arising under the Deposit Agreement will be vested in the federal and state courts located in the State of New York, Borough of Manhattan, which is the customary forum for depositary receipt disputes. Each party to the Deposit Agreement will submit to the exclusive jurisdiction of such courts and waive any objection to venue or inconvenient forum.
C. ADS Ratio
The proposed ADS ratio is 1 ADS = 2 ordinary shares (Stammaktien) of Halcyon (the "1:2 Ratio"). The selection of this ratio is driven by the following considerations:
Current Trading Price. Halcyon's ordinary shares trade at approximately €40.00 per share on the Frankfurt Stock Exchange, based on the Company's market capitalization of approximately €8.6 billion divided by 215,000,000 outstanding shares. At the EUR/USD exchange rate of €1.00 = $1.078, as of January 10, 2026, this translates to approximately $43.12 per ordinary share.
ADS Pricing Implications. The choice of ADS ratio determines the per-ADS price at which the ADSs will trade on Nasdaq. The following analysis summarizes the implications of various ratio options:
• A 1:1 ratio (1 ADS = 1 ordinary share) would place the ADS at approximately $43.12, which is within a typical institutional price range but would result in a one-to-one correspondence between ADS and ordinary share prices, complicating cross-market price comparisons due to currency fluctuations.
• A 2:1 ratio (1 ADS = 2 ordinary shares) would imply an ADS price of approximately $86.24 ($43.12 × 2), which is above the optimal range for a new Nasdaq listing in the semiconductor sector but would result in a higher per-ADS price that some institutional investors prefer.
• The proposed 1:2 ratio (1 ADS = 2 ordinary shares), combined with the proposed IPO pricing range of $39.00–$45.00 per ADS, implies an ordinary share price embedded in each ADS of $19.50–$22.50 per share. This reflects the expectation that the IPO pricing may incorporate a discount or premium relative to the current Frankfurt trading levels, adjusted for the market conditions at the time of pricing, and is consistent with the proposed prospectus cover page price range.
Rationale for the 1:2 Ratio. The 1:2 Ratio is designed to achieve a per-ADS price point that is attractive to US institutional investors, who typically prefer newly listed securities to price in the range of approximately $20 to $80 per share for IPOs. The proposed price range of $39.00–$45.00 falls squarely within this zone. The ratio also facilitates round-lot trading (100 ADSs = 200 ordinary shares) and efficient cross-market arbitrage between the Nasdaq ADS price and the Frankfurt ordinary share price.
Amendment. The ADS ratio is fixed at the closing of the offering but may be amended in the future by agreement between Halcyon and Meridian Trust, with appropriate notice to ADS holders as provided in the Deposit Agreement. Any change to the ADS ratio would require filing an amendment to the Form F-6 registration statement and, depending on the nature of the change, may require an amendment to the Deposit Agreement.
D. Deposit of Ordinary Shares and Issuance of ADSs
The mechanics of ADS issuance are as follows: ordinary shares of Halcyon are deposited with the German custodian appointed by Meridian Trust (which custodian will coordinate with Ashgrove Enterprises Banking AG, the German central securities depository, for settlement and safekeeping). Upon confirmation that the ordinary shares have been deposited with the custodian, Meridian Trust issues the corresponding number of ADSs to the depositing holder or its designee. The ADSs are then credited to the holder's DTC account (or issued in certificated form, though book-entry through DTC is the standard for exchange-listed ADSs).
IPO Context. In the context of the IPO, the deposit and issuance mechanics will operate as follows:
• Primary Shares: The 30,000,000 newly issued ordinary shares to be issued by Halcyon pursuant to the primary offering will be deposited with the German custodian upon closing of the offering. Meridian Trust will issue 15,000,000 ADSs against these deposited shares and deliver them through DTC to the underwriters' accounts for settlement with the purchasing investors.
• Secondary Shares: The 12,800,000 existing ordinary shares being sold by Rheintal (8,500,000 shares) and Kestrel (4,300,000 shares) will be deposited with the German custodian by the selling shareholders (or on their behalf through their respective custodians). Meridian Trust will issue 6,400,000 ADSs against these deposited shares and deliver them through DTC for settlement.
Pre-Release ADSs. The Deposit Agreement will address the extent to which the Depositary may issue ADSs before the actual deposit of ordinary shares with the custodian — a practice known as "pre-release." Pre-release issuances are used to facilitate settlement efficiency and market-making activity. Market practice is to include pre-release provisions in the Deposit Agreement, subject to conditions and limitations designed to prevent excessive or speculative pre-release issuance, including requirements that the recipient of pre-released ADSs represent that it owns the underlying ordinary shares, that the aggregate number of pre-released ADSs outstanding at any time not exceed a specified limit (typically 30% of the total ADSs outstanding), and that pre-released ADSs be returned within a specified period (typically five business days).
E. Withdrawal of Ordinary Shares
ADS holders have the right at any time to surrender their ADSs to Meridian Trust and withdraw the corresponding ordinary shares from the custodian. This right of withdrawal is a fundamental feature of the ADR structure and ensures the convertibility of ADSs back into the underlying ordinary shares. Upon surrender of ADSs and payment of any applicable depositary fees, taxes, and governmental charges, Meridian Trust will instruct the German custodian to deliver the corresponding ordinary shares to the surrendering holder (or to such holder's designee, such as a broker or custodian in Germany).
This withdrawal mechanism is critical for maintaining the economic link and price parity between the ADSs trading on Nasdaq and the ordinary shares trading on the Frankfurt Stock Exchange. Professional arbitrageurs actively exploit pricing discrepancies between the two markets by depositing ordinary shares to create ADSs (when ADSs trade at a premium to the ordinary shares, adjusted for currency) or by canceling ADSs and selling the underlying ordinary shares on the Frankfurt exchange (when ordinary shares trade at a premium). This arbitrage activity serves to align the prices in the two markets, subject to currency fluctuations and transaction costs.
F. Depositary Fees
The Deposit Agreement will include a fee schedule governing the fees payable by ADS holders to Meridian Trust for the services provided under the program. The following fee structure is consistent with current market practice for Level III ADR programs and is subject to final negotiation between Halcyon and Meridian Trust:
In addition to the fixed fees set forth above, the Depositary may seek reimbursement from ADS holders, or deduction from distributions to ADS holders, for certain expenses incurred in connection with the administration of the program, including cable, telex, and facsimile charges, delivery costs, applicable taxes and governmental charges, and other out-of-pocket expenses.
The annual depositary service fee is typically collected by deducting it from cash dividends or other distributions paid to ADS holders, or by billing ADS holders directly (through their brokers) if no distributions are made during the relevant period. The specific mechanics for collection of the annual fee will be set forth in the Deposit Agreement.
These fees will be detailed in a Fee Schedule attached as an exhibit to the Deposit Agreement and described in the Form F-1 prospectus under the heading "Description of American Depositary Shares — Fees and Charges."
G. Dividends and Distributions
Cash Dividends. When Halcyon declares and pays a cash dividend on its ordinary shares, Meridian Trust will receive the dividend from the German custodian in euros. Meridian Trust will convert the euro-denominated dividend to US dollars at the prevailing exchange rate (net of any currency conversion fees and expenses) and distribute the US dollar amount to ADS holders of record, after deducting the applicable depositary fees and any taxes withheld.