        5(&200(1'(' )25 )8//7(;7 38%/,&$7,21
             3XUVXDQW WR 6L[WK &LUFXLW 5XOH 

     (/(&7521,& &,7$7,21  )(' $SS 3 WK &LU
                 )LOH 1DPH DS




81,7('67$7(6&28572)$33($/6
               )257+(6,;7+&,5&8,7
                 BBBBBBBBBBBBBBBBB


 +$55< : $33/(*$7( ,1&        ;
          3ODLQWLII$SSHOODQW     
                                   
                                     1R
           Y                      
                                    !
                                   
 67$785( (/(&75,& ,1&           
          'HIHQGDQW$SSHOOHH 
                                  1
      $SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW
     IRUWKH1RUWKHUQ'LVWULFWRI2KLRDW&OHYHODQG
   1Rn3DXO50DWLD&KLHI'LVWULFWsXGJH
               $UJXHG1RYHPEHU
          'HFLGHGDQG)LOHG'HFHPEHU
%HIRUH0(55,77&/$<DQG*,/0$1&LUFXLWsXGJHV
                   BBBBBBBBBBBBBBBBB
                        &2816(/
$5*8('  3KLOLS s :HDYHU sU 60,7+ 0$56+$//
:($9(5 	 9(5*21 &OHYHODQG 2KLR IRU $SSHOODQW
$QQ(.QXWK%(1(6&+)5,('/$1'(5&23/$1	
$5212)) &OHYHODQG 2KLR IRU $SSHOOHH  21 %5,()
3KLOLSs:HDYHUsU60,7+0$56+$//:($9(5	
9(5*21&OHYHODQG2KLR*HRUJH*ODYLQRVsU&OHYHODQG
2KLR IRU $SSHOODQW  $QQ ( .QXWK 0D\QDUG $ %XFN


                             
     $SSOHJDWH,QFY6WDWXUH(OHFWULF           1R

%(1(6&+ )5,('/$1'(5 &23/$1 	 $5212))
&OHYHODQG2KLRIRU$SSHOOHH
                     BBBBBBBBBBBBBBBBB
                         23,1,21
                     BBBBBBBBBBBBBBBBB
  0(55,77&LUFXLWsXGJH3ODLQWLII+DUU\:$SSOHJDWH
,QFEULQJVDGLYHUVLW\DFWLRQIRUEUHDFKRIFRQWUDFWDJDLQVW
'HIHQGDQW6WDWXUH(OHFWULF,QFm6WDWXUHlDOOHJLQJIDLOXUHWR
SD\ FRPPLVVLRQV RQ RUGHUV VROLFLWHG E\ WKH 3ODLQWLII DQG
SODFHGERWKSULRUDQGVXEVHTXHQWWRLWVWHUPLQDWLRQ%HFDXVH
WKH JRYHUQLQJ VWDWH ODZ SURYLGHV IRU WKH SD\PHQW RI
FRPPLVVLRQVRQVSHFLILFRUGHUVSODFHGSULRUWRWHUPLQDWLRQ
VHH0F&DVNH\Y&XPEHUODQG*ODVV0IJ&R1<6
1<$SS'LYDIILUPHG1<1(
DQGEHFDXVHWKHUHLVQRFRQWUDFWXDOSURYLVLRQWRWKH
FRQWUDU\ ZH FRQFOXGH WKDW WKH 3ODLQWLII LV HQWLWOHG WR
FRPPLVVLRQVRQDQ\VXFKRUGHUVSODFHGSULRUWRWHUPLQDWLRQ
:HDOVRILQGWKDWWKHFRQWUDFWEDUVFRPPLVVLRQVRQVSHFLILF
RUGHUV SODFHG DIWHU WHUPLQDWLRQ EHFDXVH WKH SDUWLHV FOHDUO\
FRQVLGHUHGSRVWWHUPLQDWLRQFRPPLVVLRQVEXWGLGQRWLQFOXGH
WKHPLQWKHZULWWHQFRQWUDFW/DVWO\3ODLQWLIIDUJXHVWKDWWKH
GLVWULFWFRXUWHUUHGLQGHQ\LQJLWOHDYHWRDPHQGLWVFRPSODLQW
WRDGGDQXQMXVWHQULFKPHQWFODLP:HILQGWKLVDUJXPHQW
ZLWKRXWPHULW$FFRUGLQJO\DQGIRUWKHUHDVRQVWKDWIROORZ
WKHGHFLVLRQRIWKHGLVWULFWFRXUWLV$)),50('LQSDUWDQG
5(9(56(' LQ SDUW DQG WKLV FDVH LV 5(0$1'(' WR WKH
GLVWULFW FRXUW IRU IXUWKHU SURFHHGLQJV FRQVLVWHQW ZLWK WKLV
RSLQLRQ
   7KH 3ODLQWLII ZRUNV DV D VDOHV UHSUHVHQWDWLYH VROLFLWLQJ
RUGHUV RQ EHKDOI RI PDQXIDFWXUHUV  ,Q  WKH 3ODLQWLII
EHJDQVHOOLQJIRU6WDWXUHXQGHUDQRUDODUUDQJHPHQWDQGWKH
SDUWLHVVXEVHTXHQWO\HQWHUHGLQWRDZULWWHQFRQWUDFWLQ0D\
  8QGHUWKH$JUHHPHQWWKH3ODLQWLIIZDVJUDQWHGWKH
H[FOXVLYH ULJKW WR VROLFLW RUGHUV IRU 6WDWXUHjV IUDFWLRQDO
KRUVHSRZHUHOHFWULFPRWRUVZLWKLQDFHUWDLQJHRJUDSKLFDUHD
LQH[FKDQJHIRUFRPPLVVLRQVRIILYHSHUFHQW7KH$JUHHPHQW
IXUWKHUSURYLGHGWKDWm&RPPLVVLRQVVKDOOEHGHHPHGHDUQHG
1R            $SSOHJDWH,QFY6WDWXUH(OHFWULF          

E\>3ODLQWLII@XSRQSD\PHQWIRUSURGXFWVWR>6WDWXUH@l2Q
0D\   6WDWXUH WHUPLQDWHG LWV UHODWLRQVKLS ZLWK WKH
3ODLQWLIISXUVXDQWWRWKHWHUPVRIWKH$JUHHPHQW
   $W LVVXH LQ WKLV FDVH LV ZKHWKHU 3ODLQWLII LV HQWLWOHG WR
FRPPLVVLRQV IRU JRRGV SDLG IRU DIWHU  WHUPLQDWLRQ EXW
UHOHDVHGXQGHUEODQNHWSXUFKDVHRUGHUVWKDWZHUHSURFXUHGE\
3ODLQWLII DQG LQ SODFH SULRU WR WHUPLQDWLRQ  7KHVH EODQNHW
SXUFKDVHRUGHUVGLGQRWREOLJDWHDFXVWRPHUWREX\RU6WDWXUH
WRVHOODQ\VSHFLILFTXDQWLW\RIJRRGVEXWVLPSO\HVWDEOLVKHG
WKHWHUPVIRUWKHSDUWLFXODUPRWRUVIURPWLPHWRWLPHRUGHUHG
E\WKHFXVWRPHUDQGUHOHDVHGE\6WDWXUH6WDWXUHZDVIUHHWR
WHUPLQDWHDEODQNHWSXUFKDVHRUGHUDWZLOO
   7KHGLVWULFWFRXUWKHOGWKDWDVDPDWWHURIODZWKHFRQWUDFW
WHUPVSURYLGHGWKDWWKHFRPPLVVLRQZDVQRWmHDUQHGlXQWLO
WKHRUGHUZDVSDLGIRUDQGDVDUHVXOWJUDQWHGWKH'HIHQGDQWjV
PRWLRQIRUVXPPDU\MXGJPHQW,QDGGLWLRQWKHGLVWULFWFRXUW
GHQLHG3ODLQWLIIjVPRWLRQWRILOHDQDPHQGHGFRPSODLQWDGGLQJ
DQXQMXVWHQULFKPHQWFODLP
  2QDSSHDOZHUHYLHZDGLVWULFWFRXUWjVJUDQWRIVXPPDU\
MXGJPHQWGHQRYRs=*5HVRXUFHVY6KHOE\,QV&R
)GWK&LU8QGHULWVWHUPVWKH$JUHHPHQWLV
JRYHUQHGE\1HZ<RUNODZ
  7KHUH DUH WKUHH SRWHQWLDO VLWXDWLRQV DW LVVXH KHUH  WKH
JRRGVZHUHRUGHUHGEHIRUHWHUPLQDWLRQDQGSDLGIRUEHIRUH
WHUPLQDWLRQWKHJRRGVZHUHRUGHUHGEHIRUHEXWSDLGIRU
DIWHUWHUPLQDWLRQDQGWKHJRRGVZHUHERWKRUGHUHGDQG
SDLGIRUDIWHUWHUPLQDWLRQ7KHILUVWVLWXDWLRQKDVEHHQVHWWOHG
E\WKHSDUWLHVZLWKWKH3ODLQWLIIUHLPEXUVHGE\WKH'HIHQGDQW
   8QGHU WKH VHFRQG VLWXDWLRQ WKH 3ODLQWLII LV HQWLWOHG WR
FRPPLVVLRQVXSRQDOORUGHUVREWDLQHGE\LWDQGDFFHSWHGE\
WKH'HIHQGDQWDQGXSRQZKLFKVKLSPHQWVRUSD\PHQWVZHUH
PDGHDIWHU3ODLQWLIIOHIW'HIHQGDQWjVHPSOR\LQWKHDEVHQFH
RIDQ\DJUHHPHQWWRWKHFRQWUDU\0F&DVNH\Y&XPEHUODQG
*ODVV 0IJ &R  1<6   1< $SS 'LY 
DIILUPHG1<1(6HH9DQ3UDDJ
Y )5 &RUS  1<6G  1< 6XS &W   7KH
     $SSOHJDWH,QFY6WDWXUH(OHFWULF              1R       1R            $SSOHJDWH,QFY6WDWXUH(OHFWULF         

GLVWULFW FRXUW IRXQG WKDW WKH $JUHHPHQW DW LVVXH EDUV            IRUHFORVHGIURPUHFRYHULQJXQGHUDmSURFXULQJFDXVHlWKHRU\
FRPPLVVLRQV RQ DOO RUGHUV SDLG IRU DIWHU WHUPLQDWLRQ  :H       EHFDXVH WKDW WKHRU\ GRHV QRW DSSO\ WR VDOHV UHSUHVHQWDWLYH
GLVDJUHH                                                              DJUHHPHQWV  6HH 8:& ,QF Y (DJOH ,QGXVWULHV ,QF 
                                                                         $G1<$SS7KH3ODLQWLIILVWKHUHIRUH
   7KHODQJXDJHRIWKH$JUHHPHQWSURYLGHVIRUSD\PHQWRI                 QRW HQWLWOHG WR DQ\ FRPPLVVLRQV RQ VSHFLILF RUGHUV SODFHG
FRPPLVVLRQVWRWKH3ODLQWLIIDIWHUWKH'HIHQGDQWKDVUHFHLYHG            DIWHULWVWHUPLQDWLRQHYHQLIWKH\ZHUHSODFHGXQGHUEODQNHW
SD\PHQWEXWLVDPELJXRXVDVWRZKHWKHUWKH3ODLQWLIIjVULJKW            SXUFKDVHRUGHUVSURFXUHGE\LW
WRUHFHLYHFRPPLVVLRQVRQSODFHGVSHFLILFRUGHUVLVFXWRIIE\
WHUPLQDWLRQEHFDXVHWKH'HIHQGDQWKDVQRWUHFHLYHGSD\PHQW                )LQDOO\ 3ODLQWLII FODLPV WKDW WKH GLVWULFW FRXUW HUUHG LQ
%HFDXVHWKH$JUHHPHQWGRHVQRWFOHDUO\SURYLGHDFRQWUDU\                IDLOLQJWRSURYLGHLWOHDYHWRDPHQGLWVFRPSODLQWWRDGGDQ
SURYLVLRQZHPXVWIROORZ1HZ<RUNODZ$VDUHVXOWWKH                XQMXVW HQULFKPHQW FODLP  %HFDXVH ZH UHDG WKH FRQWUDFW WR
3ODLQWLII LV HQWLWOHG WR FRPPLVVLRQV RQ VSHFLILF RUGHUV IRU      IRUHFORVHSRVWWHUPLQDWLRQFRPPLVVLRQVEDVHG RQWKHSULRU
JRRGV SODFHG SULRU WR 0D\    %HFDXVH WKHUH LV QR       DFWLRQVRIWKHSDUWLHVZHILQGWKDWWKHGLVWULFWFRXUWGLGQRW
HYLGHQFHLQWKHUHFRUGDVWRWKHGDWHRUDPRXQWRIVSHFLILF              HUU  8QGHU 1HZ <RUN ODZ WKH H[LVWHQFH RI D YDOLG DQG
RUGHUV ZH UHPDQG WKH FDVH WR WKH GLVWULFW FRXUW IRU DQ        ZULWWHQ FRQWUDFW JRYHUQLQJ D SDUWLFXODU VXEMHFW PDWWHU
HYLGHQWLDU\GHWHUPLQDWLRQ                                               SUHFOXGHVUHFRYHU\LQTXDVLFRQWUDFWIRUHYHQWVFRQFHUQLQJWKH
                                                                         VDPHVXEMHFWPDWWHU&ODUN)LW]SDWULFN,QFY/RQJ,VODQG
  7KHWKLUGVLWXDWLRQDSSOLHVWRJRRGVRUGHUHGSXUVXDQWWRWKH           5DLO5RDG&R1<G1<+HUHWKH
EODQNHWSXUFKDVHRUGHUVVROLFLWHGE\WKH3ODLQWLIIXQGHUZKLFK           SDUWLHV FOHDUO\ FRQWHPSODWHG DQG UHMHFWHG SRVW WHUPLQDWLRQ
VSHFLILFRUGHUVIRUJRRGVZHUHSODFHGRQPXOWLSOHRFFDVLRQV              FRPPLVVLRQV LQ WKHLU FRQWUDFW DQG DV D UHVXOW 3ODLQWLII LV
DIWHUWHUPLQDWLRQ&RQWUDU\WR3ODLQWLIIjVDVVHUWLRQVZHILQG          IRUHFORVHGIURPDVVHUWLQJDQXQMXVWHQULFKPHQWFODLP
WKDW WKH DFWLRQV RI WKH SDUWLHV UHYHDO DQ LQWHQW WR SURKLELW
FRPPLVVLRQV RQ VSHFLILF RUGHUV SODFHG DIWHU WHUPLQDWLRQ              7KXVZH5(9(56(WKHGLVWULFWFRXUWWRWKHH[WHQWWKDWLW
%HFDXVHWKHFRQWUDFWLVDPELJXRXVZHORRNWRWKHFRQGXFWRI             SURKLELWHG FRPPLVVLRQV IRU VSHFLILF RUGHUV SODFHG SULRU WR
WKH SDUWLHV WR GHWHUPLQH WKHLU LQWHQW  6D\HUV Y 5RFKHVWHU     WHUPLQDWLRQZH$)),50WKHGLVWULFWFRXUWjVGHFLVLRQWRGHQ\
7HOHSKRQH&RUS6XSSOHPHQWDO0DQDJHPHQW3HQVLRQ3ODQ                  3ODLQWLIIOHDYHWRDPHQGLWVFRPSODLQWDQGZH5(0$1'IRU
)GG&LU                                        D GHWHUPLQDWLRQ RI WKH DPRXQW RZHG WR 3ODLQWLII LQ
                                                                         FRPPLVVLRQV IRU VSHFLILF RUGHUV SODFHG SULRU WR LWV
  ,QWKH3ODLQWLIISURSRVHGWKDWWKHSDUWLHVDPHQGWKHLU           WHUPLQDWLRQ
RUDODJUHHPHQWWRLQFOXGHWKHDZDUGLQJRIFRPPLVVLRQVIRUD
RQH \HDU GXUDWLRQ DIWHU WHUPLQDWLRQ  7KLV DPHQGPHQW ZDV
UHMHFWHGE\WKH'HIHQGDQWDQGZDVQRWDGRSWHGLQZKHQ
WKHSDUWLHVHQWHUHGWKHJRYHUQLQJZULWWHQDJUHHPHQW%HFDXVH
FRPPLVVLRQVRQSRVWWHUPLQDWLRQRUGHUVZHUHFRQVLGHUHGDQG
UHMHFWHGZHLQWHUSUHWWKHDPELJXLW\LQWKHFRQWUDFWLQIDYRURI
WKH'HIHQGDQW+HUH3ODLQWLIIZDVRQQRWLFHWKDWWKHFRQWUDFW
GLGQRWSURYLGHIRUVXFKSRVWWHUPLQDWLRQFRPPLVVLRQVEDVHG
RQ WKH SDUWLHV SULRU QHJRWLDWLRQV DQG WKHUHIRUH VKRXOG QRW
KDYH KDG DQ\ H[SHFWDWLRQ RI UHFHLYLQJ VXFK FRPPLVVLRQV
/DVWO\ DOWKRXJK 3ODLQWLII GLG QRW UDLVH LW LW ZRXOG EH
