           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


 81,7(' 67$7(6 2) $0(5,&$    ;
          3ODLQWLII$SSHOODQW 
             &URVV$SSHOOHH   
                                               1RV
                                               
          Y                    !
                               
                               
 s$&.621 & 2j'(// ,,,       
         'HIHQGDQW$SSHOOHH 
             &URVV$SSHOODQW 
                              1
           $SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW
        IRUWKH(DVWHUQ'LVWULFWRI7HQQHVVHHDW.QR[YLOOH
         1Rn5/HRQsRUGDQ'LVWULFWsXGJH
                    $UJXHG2FWREHU
               'HFLGHGDQG)LOHG$SULO
    %HIRUH'$8*+75(<DQG&/$<&LUFXLWsXGJHV
                &2+1'LVWULFWsXGJH




    
     7KH +RQRUDEOH $YHUQ &RKQ 6HQLRU 8QLWHG 6WDWHV 'LVWULFW sXGJH IRU
WKH (DVWHUQ 'LVWULFW RI 0LFKLJDQ VLWWLQJ E\ GHVLJQDWLRQ



                                    
     8QLWHG6WDWHVY2j'HOO           1RV

                      BBBBBBBBBBBBBBBBB
                           &2816(/
$5*8('6WHYH+&RRN$66,67$1781,7('67$7(6
$77251(<.QR[YLOOH7HQQHVVHHIRU$SSHOODQW'DYLG6
:LJOHU.QR[YLOOH7HQQHVVHHIRU$SSHOOHH21%5,()
6WHYH + &RRN $66,67$17 81,7(' 67$7(6
$77251(<.QR[YLOOH7HQQHVVHHIRU$SSHOODQW'DYLG6
:LJOHU +HUEHUW 6 0RQFLHU .QR[YLOOH 7HQQHVVHH IRU
$SSHOOHH
                      BBBBBBBBBBBBBBBBB
                          23,1,21
                      BBBBBBBBBBBBBBBBB
  &/$< &LUFXLW sXGJH  7KLV LV D FRQVROLGDWHG DSSHDO LQ
ZKLFKWKHJRYHUQPHQWDSSHDOVIURPWZRVHSDUDWHMXGJPHQWV
HQWHUHGE\WKH8QLWHG6WDWHV'LVWULFW&RXUWIRUWKH(DVWHUQ
'LVWULFW RI 7HQQHVVHH LQ IDYRU RI 'HIHQGDQW sDFNVRQ &
2j'HOO,,,m'HIHQGDQWlUHGXFLQJKLVVHQWHQFHDQGGHFOLQLQJ
WR RUGHU WKH IRUIHLWXUH RI FHUWDLQ SURSHUW\  ,Q DGGLWLRQ
'HIHQGDQW FURVVDSSHDOV RQ VSHHG\ WULDO JURXQGV KLV
FRQYLFWLRQRQFKDUJHVVWHPPLQJIURPKLVLQYROYHPHQWLQD
PDULMXDQDJURZLQJDQGGLVWULEXWLRQRSHUDWLRQ
  6SHFLILFDOO\LQ&DVH1R'HIHQGDQWFURVVDSSHDOV
IURPWKHGLVWULFWFRXUWjVGHQLDORIKLVPRWLRQWRGLVPLVVWKH
LQGLFWPHQWIRUYLRODWLRQRIWKHVSHHG\WULDOSURYLVLRQRIWKH
6L[WK $PHQGPHQW  7KH GLVWULFW FRXUW GHWHUPLQHG WKDW
'HIHQGDQWIDLOHGWRVDWLVI\WKHIRXUIDFWRUEDODQFLQJWHVWRI
%DUNHUY:LQJR86DQGZDVWKHUHIRUHQRW
HQWLWOHG WR UHOLHI  ,Q &DVH 1R  WKH 8QLWHG 6WDWHV
DSSHDOV IURP WKH GLVWULFW FRXUWjV MXGJPHQW VHQWHQFLQJ
'HIHQGDQWWRHLJKWHHQPRQWKVLPSULVRQPHQWXSRQDSSOLFDWLRQ
RIWKHmVDIHW\YDOYHlSURYLVLRQVRI86&IDQG
XQGHU WKH UDQJH HVWDEOLVKHG E\ 8QLWHG 6WDWHV 6HQWHQFLQJ
&RPPLVVLRQ*XLGHOLQHV0DQXDO&7KHGLVWULFWFRXUW
GHWHUPLQHG WKDW 'HIHQGDQW HVWDEOLVKHG KLV HOLJLELOLW\ IRU D
UHGXFHG VHQWHQFH XQGHU WKH VDIHW\ YDOYH DQG WKHQ IRXQG D
    8QLWHG6WDWHVY2j'HOO          1RV          1RV             8QLWHG6WDWHVY2j'HOO         

LWRQO\DSSOLHVWRWKHSRVWIRUIHLWXUHFRQWH[W,QDVPXFKDVQR        VHQWHQFLQJ UDQJH RI HLJKWHHQ WR WZHQW\IRXU PRQWKV
IRUIHLWXUH RUGHU ZDV HYHU HQWHUHG WKH UHTXLUHPHQWV RI WKDW    LPSULVRQPHQWXOWLPDWHO\VHQWHQFLQJ'HIHQGDQWWRHLJKWHHQ
SURYLVLRQFRXOGQRWEHWULJJHUHG0RUHRYHUZHQRWHWKDWLI           PRQWKV,Q&DVH1RWKHJRYHUQPHQWDOVRDSSHDOV
WKH JRYHUQPHQW ZHUH WUXO\ FRQFHUQHG DERXW JDWKHULQJ              IURP WKH GLVWULFW FRXUWjV IDLOXUH WR RUGHU WKH IRUIHLWXUH RI
HYLGHQFHUHJDUGLQJSURRIRIRZQHUVKLSLWFRXOGKDYHDWWKH            FHUWDLQ IDUP SURSHUW\ SXUVXDQW WR  86&    7KH
YHU\OHDVWUHTXHVWHGDUHFHVVIRUSXUSRVHVRIGLVFRYHU\DQG            GLVWULFW FRXUW GHWHUPLQHG WKDW IRUIHLWXUH ZDV LQDSSURSULDWH
LQYHVWLJDWLRQ%XWWKHUHFRUGUHIOHFWVQRVXFKDWWHPSWE\WKH         EHFDXVH'HIHQGDQWZDVQRWWKHWUXHRZQHURIWKHSURSHUW\
JRYHUQPHQW
                                                                         2Q PRWLRQ RI WKH JRYHUQPHQW DOO WKUHH DSSHDOV ZHUH
                        &21&/86,21                                     FRQVROLGDWHG IRU DUJXPHQW DQG VXEPLVVLRQ  :H QRZ
                                                                       $)),50 WKH GLVWULFW FRXUWjV RUGHU GHQ\LQJ WKH PRWLRQ WR
  :LWKUHVSHFWWR'HIHQGDQWjVFURVVDSSHDOLQ&DVH1R             GLVPLVVRQVSHHG\WULDOJURXQGVDVZHOODVWKHGLVWULFWFRXUWjV
ZHEHOLHYHWKDWXQGHUWKHIRXUIDFWRUVILUVWHVWDEOLVKHG         UHIXVDO WR RUGHU IRUIHLWXUH RI WKH IDUP SURSHUW\  %XW ZH
LQ %DUNHU Y :LQJR 'HIHQGDQW KDV IDLOHG WR VKRZ WKDW KLV     9$&$7(WKHGLVWULFWFRXUWjVMXGJPHQWVHQWHQFLQJ'HIHQGDQW
6L[WK$PHQGPHQWULJKWWRDVSHHG\WULDOZDVYLRODWHG:H             WR HLJKWHHQ PRQWKV LPSULVRQPHQW DQG 5(0$1' IRU UH
WKHUHIRUH$)),50WKHGLVWULFWFRXUWjVGHQLDORIWKHPRWLRQ            VHQWHQFLQJZLWKRXWDSSOLFDWLRQRIWKHVDIHW\YDOYHSURYLVLRQV
WRGLVPLVVWKHLQGLFWPHQWRQ6L[WK$PHQGPHQWVSHHG\WULDO
JURXQGV:LWKUHVSHFWWRWKHJRYHUQPHQWjVDSSHDOLQ&DVH                                     %$&.*5281'
1R  ZH KROG WKDW WKH GLVWULFW FRXUWjV ILQGLQJ WKDW
'HIHQGDQW VXFFHVVIXOO\ HVWDEOLVKHG KLV HOLJLELOLW\ IRU WKH          3ULRUWR$XJXVWDQLQYHVWLJDWLRQZDVFRQGXFWHGE\
SURWHFWLRQRIWKHmVDIHW\YDOYHlRI86&IDQG           IHGHUDODXWKRULWLHVUHJDUGLQJ'HIHQGDQWjVLQYROYHPHQWLQGUXJ
866*&ZDVFOHDUO\HUURQHRXV7KXVZH9$&$7(                   WUDIILFNLQJ  'XULQJ WKH LQYHVWLJDWLRQ ODZ HQIRUFHPHQW
WKH MXGJPHQW RI VHQWHQFH HQWHUHG E\ GLVWULFW FRXUW DQG         RIILFLDOVUHFHLYHGLQIRUPDWLRQIURPDFLWL]HQLQIRUPDQWWKDW
5(0$1'IRUUHVHQWHQFLQJZLWKRXWDSSOLFDWLRQRIWKHVDIHW\             'HIHQGDQWZDVLQYROYHGLQPDULMXDQDDQGFRFDLQHGLVWULEXWLRQ
YDOYH  )LQDOO\ LQ &DVH 1R  ZH ILQG WKDW            DQGIXUWKHUWKDWKHKDGEHHQDSLORWVPXJJOLQJGUXJVIRUDQ
'HIHQGDQWjV LQWHUHVW LQ WKH DFUH IDUP SURSHUW\ ZDV          RUJDQL]HG FULPH RSHUDWLRQ  ,Q FRUURERUDWLRQ RI WKLV
H[WLQJXLVKHGDQGQRORQJHUH[LVWV7KHUHIRUHZHKROGWKDW            LQIRUPDWLRQWZRIHGHUDODJHQWVREVHUYHG'HIHQGDQWDQGKLV
WKHGLVWULFWFRXUWjVUHIXVDOWRRUGHUIRUIHLWXUHRIWKDWLQWHUHVW      WZRVRQVHQWHUDEDUQRQVRPHIDUPSURSHUW\ODWHULGHQWLILHG
GRHV QRW DPRXQW WR UHYHUVLEOH HUURU DQG ZH $)),50 WKH         DVWKHDFUHIDUPSURSHUW\7KH\ZRUNHGIRUDQH[WHQGHG
GLVWULFWFRXUWjVRUGHUGHQ\LQJIRUIHLWXUH                             SHULRGRIWLPHFRPLQJRXWSHULRGLFDOO\WRFRRORII'XULQJ
                                                                       WKHLQYHVWLJDWLRQRQHRIWKHDJHQWVXVHGDWKHUPDOLPDJLQJ
                                                                       GHYLFHWRGHWHFWKHDWHPDQDWLQJIURPWKHEDUQVWUXFWXUH,Q
                                                                       DGGLWLRQ XWLOLW\ ELOOV IRU WKH EDUQ UHIOHFWHG D VLJQLILFDQW
                                                                       HOHFWULFLW\ XVDJH  8SRQ REWDLQLQJ DQG FRPSLOLQJ WKLV DQG
                                                                       RWKHULQIRUPDWLRQDJHQWVILOHGDIILGDYLWVLQVXSSRUWRIVHDUFK
                                                                       ZDUUDQWVZKLFKWKH\VXFFHVVIXOO\REWDLQHG
                                                                         2Q $XJXVW   ODZ HQIRUFHPHQW RIILFHUV H[HFXWHG
                                                                       WZRIHGHUDOVHDUFKZDUUDQWVLQ0RQURH&RXQW\7HQQHVVHHDW
                                                                       WKH SURSHUW\ RZQHG RU FRQWUROOHG E\ 'HIHQGDQW  7KH ILUVW
                                                                       ZDUUDQW DXWKRUL]HG WKH VHDUFK RI D DFUH ORW RI IDUP
    8QLWHG6WDWHVY2j'HOO         1RV        1RV                 8QLWHG6WDWHVY2j'HOO              

SURSHUW\ LQ WKH 7HOOLFR 3ODLQV DUHD RI 0RQURH &RXQW\      SHUPLWWHGXQGHU86&P$VDWKUHVKROGPDWWHU
7HQQHVVHH WKH VHFRQG ZDUUDQW DXWKRUL]HG WKH VHDUFK RI      WKH JRYHUQPHQW IDLOHG WR SUHVHUYH WKHVH LVVXHV IRU DSSHDO
'HIHQGDQWjVKRPHDW7RQDZDQGD7UDLOLQ0DGLVRQYLOOH           LQDVPXFKDVWKH\ZHUHQRWDUJXHGLQWKHGLVWULFWFRXUW7KH
0RQURH&RXQW\7HQQHVVHH7KHDJHQWVGLVFRYHUHGZKDWWKH\         JRYHUQPHQW IDLOV WR FLWH DQ\ZKHUH LQ WKH UHFRUG ZKHUH LW
ODWHUGHVFULEHGDVWKHPRVWVRSKLVWLFDWHGPDULMXDQDJURZLQJ        REMHFWHG WR WKH GLVWULFW FRXUWjV SURFHGXUH  6HH $GYRFDF\
RSHUDWLRQWKH\KDGHYHUVHHQ2YHUWZRKXQGUHGPDULMXDQD          2UJDQL]DWLRQIRU3DWLHQWVDQG3URYLGHUV Y $XWR&OXE,QV
SODQWVLQYDULRXVVWDJHVRIJURZWKZHUHEHLQJFXOWLYDWHGLQ        $VVjQ)GWK&LUIDLOXUHWRUDLVHDQ
WKUHHVHSDUDWHURRPVRIWKHEDUQ%XVLQHVVUHFRUGVUHFRYHUHG      DUJXPHQW EHIRUH WKH GLVWULFW FRXUW FRQVWLWXWHV ZDLYHU RQ
E\DJHQWVVKRZHGWKDWEHWZHHQDQG'HIHQGDQW             DSSHDO0RUHRYHUZHILQGERWKRIWKHVHFODLPVPHULWOHVV
UHFHLYHGWKLUWHHQVKLSPHQWVRIPDULMXDQDJURZLQJHTXLSPHQW         )LUVWZHUHFRJQL]HWKDW'HIHQGDQWjVRZQHUVKLSRIWKHIDUP
YDOXHGDWDSSUR[LPDWHO\$QDJHQWWHVWLILHGWKDWWKH       SURSHUW\ZDVGLUHFWO\DWLVVXHIURPWKHVWDUWRIWKHFULPLQDO
PDULMXDQD SRVVHVVHG E\ 'HIHQGDQW ZRXOG KDYH KDG D           SURFHHGLQJVEHFDXVHLWZDVDQHFHVVDU\HOHPHQWIRUFRQYLFWLRQ
ZKROHVDOHYDOXHRI                                      RQ&RXQW7KUHHRIWKHLQGLFWPHQW7KXVWKHJRYHUQPHQW
                                                                   ZDV RQ QRWLFH WKDW LW QHHGHG WR SURYH VXFK RZQHUVKLS
 $W 'HIHQGDQWjV KRPH DW  7RQDZDQGD 7UDLORIILFHUV       5HJDUGOHVVRI'HIHQGDQWjVIRUPHUFODLPVWRRZQHUVKLSRIWKH
GLVFRYHUHGQXPHURXVLWHPVOLQNLQJ'HIHQGDQWWRSDUWLFLSDWLRQ       SURSHUW\RUWKHSHUFHLYHGVLPSOLFLW\RIWKHSURSRVLWLRQWKH
LQWKHFXOWLYDWLRQDQGJURZLQJRIPDULMXDQDDQGWRWKHEDUQ        JRYHUQPHQWHUUHGE\UHVWLQJRQLWVODXUHOVDQGDVVXPLQJWKDW
ZKHUHWKHPDULMXDQDRSHUDWLRQKDGEHHQGLVFRYHUHG7KHVH          WKLV HOHPHQW KDG EHHQ VDWLVILHG  ,QGHHG WKH JRYHUQPHQWjV
LQFOXGHG VHYHUDO PDJD]LQHV DQG SDPSKOHWV UHJDUGLQJ            IDLOXUHWRSURYHWKDW'HIHQGDQWRZQHGWKHIDUPSURSHUW\PD\
PDULMXDQD XVH DQG SURGXFWLRQ DV ZHOO DV EURFKXUHV IRU      KDYH OHG WR 'HIHQGDQWjV DFTXLWWDO RQ &RXQW 7KUHH RI WKH
PDULMXDQDVHHGVDQGJURZLQJHTXLSPHQW                             LQGLFWPHQW  ,Q DGGLWLRQ WKH GLVFRYHU\ DXWKRUL]HG E\
                                                                   VXEVHFWLRQPLVLQDSSOLFDEOHLQWKHLQVWDQWFDVHEHFDXVH
  2QWKHVDPHGD\WKHVHDUFKZDUUDQWVZHUHH[HFXWHGWKH
JRYHUQPHQWILOHGFLYLOIRUIHLWXUHDFWLRQVDJDLQVW'HIHQGDQWjV
UHVLGHQFHDQGDJDLQVWWKHDFUHIDUPSURSHUW\DQGWKH             
                                                                         6XEVHFWLRQ P SURYLGHV
LPSURYHPHQWV WKHUHRQ  7KHVH FDVHV ZHUH DVVLJQHG WKH
QXPEHUVFYDQGFYUHVSHFWLYHO\:KHQ               ,Q RUGHU WR IDFLOLWDWH WKH LGHQWLILFDWLRQ DQG ORFDWLRQ RI SURSHUW\
WKHFLYLOIRUIHLWXUHDFWLRQDJDLQVWWKHDFUHIDUPSURSHUW\       GHFODUHG IRUIHLWHG DQG WR IDFLOLWDWH WKH GLVSRVLWLRQ RI SHWLWLRQV IRU
ZDVILOHGWKHSURSHUW\GHHGRQILOHUHIOHFWHGWKDWWKHEDUQRQ        UHPLVVLRQ RU PLWLJDWLRQ RI IRUIHLWXUH DIWHU WKH HQWU\ RI DQ RUGHU

WKHIDUPSURSHUW\LQZKLFKWKHPDULMXDQDJURZLQJRSHUDWLRQ            GHFODULQJ SURSHUW\ IRUIHLWHG WR WKH 8QLWHG 6WDWHV WKH FRXUW PD\
                                                                       XSRQ DSSOLFDWLRQ RI WKH 8QLWHG 6WDWHV RUGHU WKDW WKH WHVWLPRQ\
ZDV GLVFRYHUHG ZDV LQ WKH QDPH RI 'HIHQGDQWjV IDWKHU         RI DQ\ ZLWQHVV UHODWLQJ WR WKH SURSHUW\ IRUIHLWHG EH WDNHQ E\
sDFNVRQ&2j'HOOsU2j'HOOsUVWDWHGDWWKHWLPHWKDWWKH        GHSRVLWLRQ DQG WKDW DQ\ GHVLJQDWHG ERRN SDSHU GRFXPHQW
EDUQEHORQJHGWR'HIHQGDQWKLVVRQ7KHJRYHUQPHQWODWHU             UHFRUG UHFRUGLQJ RU RWKHU PDWHULDO QRW SULYLOHJHG EH SURGXFHG
OHDUQHGWKDWWKHEDUQDQGDFUHVRIWKHIDUPSURSHUW\KDG           DW WKH VDPH WLPH DQG SODFH LQ WKH VDPH PDQQHU DV SURYLGHG IRU

EHHQWKHVXEMHFWRID(VFURZ$JUHHPHQWDQG:DUUDQW\               WKH WDNLQJ RI GHSRVLWLRQV XQGHU 5XOH  RI WKH )HGHUDO 5XOHV RI
                                                                       &ULPLQDO 3URFHGXUH
'HHG EHWZHHQ IDWKHU DQG VRQ  7KHUHDIWHU D WKLUG FLYLO
IRUIHLWXUHDFWLRQZDVFRPPHQFHGDJDLQVWWKHEDUQDQGWKH           
                                                                           &RXQW 7KUHH RI WKH LQGLFWPHQW DOOHJHG WKDW 'HIHQGDQW mGLG
DFUHV7KLVFDVHZDVDVVLJQHGQXPEHUFY2Q0D\         NQRZLQJO\ DQG LQWHQWLRQDOO\ PDNH DYDLODEOH IRU XVH D EXLOGLQJ DQG
'HIHQGDQWILOHGDYHULILHGFODLPDVVHUWLQJWKDWKH       HQFORVXUH ZKLFK KH PDQDJHG DQG FRQWUROOHG DV RZQHU IRU WKH SXUSRVH RI
ZDVLQSDUWmHQWLWOHGWRRZQHUVKLSLQWKHVHL]HGSURSHUW\DV     XQODZIXOO\ PDQXIDFWXULQJ DQG VWRULQJ PDULMXDQD    l ,QGLFWPHQW s$
                                                                   DW 
     8QLWHG6WDWHVY2j'HOO              1RV         1RV             8QLWHG6WDWHVY2j'HOO        

LQWHUHVWV LQ VXEMHFW SURSHUW\ LV QRW LPSOLFDWHG LQ WKLV FDVH     WKH RZQHU RI VDLG SURSHUW\l  7KH HDUOLHU IRUIHLWXUH DFWLRQ
EHFDXVHQRIRUIHLWXUHRUGHUZDVHYHUHQWHUHG0RUHRYHULWLV             DJDLQVW WKH HQWLUH  DFUHV FY ZDV WKHQ
'HIHQGDQW ZKR LV FKDOOHQJLQJ WKH IRUIHLWXUH DQG QRW                 GLVPLVVHG
2j'HOOsU,QWKLVUHVSHFWQRWKLUGSDUW\LVLQYROYHGKHUH
7KHGLVWULFWFRXUWjVUHFRJQLWLRQWKDW2j'HOOsUZDVWKHRZQHU              $V WKH FLYLO IRUIHLWXUH DFWLRQV FRPPHQFHG 'HIHQGDQW
LVQRWDQDORJRXVWRDWKLUGSDUW\KHDULQJ:HDOVRQRWHWKDW              GLVSXWHG WKH XQGHUO\LQJ FULPLQDO FKDUJHV DJDLQVW KLP IRU
WKHUHFDOORIWKHGHHGE\2j'HOOsULVGLVWLQJXLVKDEOHIURPD            PDULMXDQD SRVVHVVLRQ DQG LQWHQW WR GLVWULEXWH  1XPHURXV
FLUFXPYHQWLRQRIIRUIHLWXUHUXOHVWKURXJKWUDQVIHURILQWHUHVWV           GHOD\V ZHUH RFFDVLRQHG E\ FKDQJHV LQ 'HIHQGDQWjV SOHD
ZKLFKWKHUHODWLRQEDFNSURYLVLRQRI86&FZDV                DJUHHPHQW)RXUWHHQPRQWKVRISOHDQHJRWLDWLRQVHQGHGZLWK
GHVLJQHGWRSUHYHQW8QGHUWKDWSURYLVLRQSURSHUW\WKDWLV               'HIHQGDQWHQWHULQJDJXLOW\SOHDRQ1RYHPEHUWRDQ
VXEVHTXHQWO\WUDQVIHUUHGWRDWKLUGSDUW\LVQRQHWKHOHVVVXEMHFW           LQIRUPDWLRQFKDUJLQJKLPZLWKPDQXIDFWXULQJPDULMXDQDLQ
WRIRUIHLWXUHXQOHVVWKHWUDQVIHUHHLVDQmLQQRFHQWRZQHUlRUD            YLRODWLRQRI86&D2YHUWKHQH[WWHQPRQWKV
ERQDILGHSXUFKDVHUZLWKLQWKHPHDQLQJRIWKHVWDWXWH%XW              WKHSDUWLHVQHJRWLDWHGWKHWHUPVRIWKHSOHDDJUHHPHQWZKLFK
LQWKHLQVWDQWFDVH'HIHQGDQWjVLQWHUHVWZDVQRWWUDQVIHUUHGWR            ZHUHGHSHQGDQWXSRQWKHJXLOW\SOHDVRI'HIHQGDQWjVIDWKHU
KLV IDWKHU UDWKHU ZH ILQG WKDW 'HIHQGDQWjV LQWHUHVW ZDV          DQGVRQVRQUHODWHGFKDUJHV
DFWXDOO\ H[WLQJXLVKHG ZKHQ KLV IDWKHU UHDFTXLUHG WKH
:DUUDQW\'HHG                                                                                          )$&76

         $OOHJHGSURFHGXUDOHUURUV                                                $&DVH1R6L[WK$PHQGPHQW
                                                                                              6SHHG\7ULDO&ODLP
  7KH JRYHUQPHQW DOVR DOOHJHV WKDW WKH GLVWULFW FRXUW
FRPPLWWHGFHUWDLQSURFHGXUDOHUURUV)LUVWWKHJRYHUQPHQW                    7KLVFDVHKDVDQH[WHQVLYHSURFHGXUDOKLVWRU\GDWLQJEDFN
FODLPVWKDWLWKDGQRQRWLFHWKDWRZQHUVKLSRIWKHSURSHUW\                QHDUO\DGHFDGHDQGLQYROYLQJFLYLOIRUIHLWXUHDFWLRQVFULPLQDO
ZRXOGEHDQLVVXHXQWLOMXVWEHIRUHWKHWULDO7KHJRYHUQPHQW             SURVHFXWLRQV DQG PXOWLSOH DSSHDOV WR DQG UHYHUVDOV E\ WKLV
DOVRDUJXHVWKDWLWZDVQRWJLYHQDQRSSRUWXQLW\WRFRQGXFW                &RXUW$SSUR[LPDWHO\RQH\HDUDIWHUWKHFDVHZDVUHIHUUHGWR
GLVFRYHU\ RQ WKH FKDOOHQJH WR 'HIHQGDQWjV RZQHUVKLS DV              WKH 8QLWHG 6WDWHV $WWRUQH\jV 2IILFH LW ZDV DVVLJQHG WR
                                                                           $VVLVWDQW8QLWHG6WDWHV$WWRUQH\m$86$l6WHSKHQ+&RRN
                                                                           'XHWRWKHOHQJWK\PDQGDWRU\PLQLPXPVHQWHQFHV'HIHQGDQW
                                                                           IDFHG$86$&RRNDQGGHIHQVHFRXQVHOHQJDJHGLQH[WHQVLYH
                                                                           SOHDQHJRWLDWLRQV$IWHUVHYHUDOPRQWKV'HIHQGDQWDJUHHGWR
     
       6XEVHFWLRQ F RI   VWDWHV                                     SOHDGJXLOW\WRYLRODWLRQRI86&ODWHUFKDQJHGWR
                                                                           DJXLOW\SOHDWR86&D7KHSOHDDJUHHPHQW
     $OO ULJKW WLWOH DQG LQWHUHVW LQ SURSHUW\ GHVFULEHG LQ VXEVHFWLRQ    DOVRFDOOHGIRU'HIHQGDQWjVIDWKHUDQGVRQVWRSOHDGJXLOW\WR
     D RI WKLV VHFWLRQ YHVWV LQ WKH 8QLWHG 6WDWHV XSRQ WKH
     FRPPLVVLRQ RI WKH DFW JLYLQJ ULVH WR IRUIHLWXUH XQGHU WKLV VHFWLRQ
                                                                           VWDWHFKDUJHVUHJDUGLQJWKHLULQYROYHPHQWLQWKHRIIHQVHV$
     $Q\ VXFK SURSHUW\ WKDW LV VXEVHTXHQWO\ WUDQVIHUUHG WR D SHUVRQ        OHWWHUFRQILUPLQJWKHSURSRVHGSOHDDJUHHPHQWZDVVHQWWRDOO
     RWKHU WKDQ WKH GHIHQGDQW PD\ EH WKH VXEMHFW RI D VSHFLDO YHUGLFW      SDUWLHVPDNLQJFOHDUWKDWWKHJRYHUQPHQWjVDFFHSWDQFHRIWKH
     RI IRUIHLWXUH DQG WKHUHDIWHU VKDOO EH RUGHUHG IRUIHLWHG WR WKH        SOHDDJUHHPHQWZDVFRQGLWLRQHGRQWKHSOHDVRI'HIHQGDQWjV
     8QLWHG 6WDWHV XQOHVV WKH WUDQVIHUHH HVWDEOLVKHV LQ D KHDULQJ         IDWKHU DQG VRQV  'HIHQGDQW DQG KLV IDWKHU DQG VRQV ZHUH
     SXUVXDQW WR VXEVHFWLRQ Q RI WKLV VHFWLRQ WKDW KH LV D ERQD ILGH
     SXUFKDVHU IRU YDOXH RI VXFK SURSHUW\ ZKR DW WKH WLPH RI SXUFKDVH
                                                                           FRQFHUQHGWKDWWKHSOHDDJUHHPHQWFRXOGSUHYHQWWKHIDWKHU
     ZDV UHDVRQDEO\ ZLWKRXW FDXVH WR EHOLHYH WKDW WKH SURSHUW\ ZDV
                                                                           DQGVRQVIURPREWDLQLQJDMXGLFLDOGLYHUVLRQIURPWKHVWDWH
     VXEMHFW WR IRUIHLWXUH XQGHU WKLV VHFWLRQ                             FRXUW  7KXV $86$ &RRN DGGHG D FODXVH WR WKH SOHD
     8QLWHG6WDWHVY2j'HOO          1RV         1RV                8QLWHG6WDWHVY2j'HOO            

DJUHHPHQWLQGLFDWLQJWKDWmQRWKLQJLQWKLVFODXVHRIWKHSOHD         RUGHU LQ WKH LQVWDQW FDVH ZKHUH 'HIHQGDQWjV LQWHUHVW KDV
DJUHHPHQWLVLQWHQGHGWRSUHYHQWWKHGHIHQGDQWjVIDWKHURUWKH        DOUHDG\EHHQH[WLQJXLVKHG7KHJRYHUQPHQWjVSURSHUFRXUVH
GHIHQGDQWjV VRQV IURP DSSO\LQJ IRU RU REWDLQLQJ MXGLFLDO       RISURFHGXUHLQWKLVFDVHZRXOGKDYHEHHQWRVHHNIRUIHLWXUH
GLYHUVLRQDQGWKHLUREWDLQLQJVXFKGLYHUVLRQZLOOQRWDIIHFW          RQ D WLPHO\ EDVLV RU WR VHHN D SURWHFWLYH RUGHU DJDLQVW WKH
WKLV SOHD DJUHHPHQWl  6XEVHTXHQWO\ SOHD QHJRWLDWLRQV          HVFURZDJHQWWRSUHYHQWWKHUHGHOLYHU\RIWKHZDUUDQW\GHHG
EHWZHHQWKHGLVWULFWDWWRUQH\DQG'HIHQGDQWjVIDWKHUDQGVRQV         WR2j'HOOsU7KHFULPLQDOIRUIHLWXUHVFKHPHSURYLGHVIRU
EURNHGRZQ2QFHLWZDVFOHDUWKDW'HIHQGDQWjVIDWKHUDQG            VXFKSURWHFWLYHRUGHUVWRHQVXUHWKHDYDLODELOLW\RIHSKHPHUDO
VRQV ZRXOG QRW SOHDG JXLOW\ WR VWDWH FKDUJHV $86$ &RRN      LQWHUHVWVGXULQJWKHSHQGHQF\RIDIRUIHLWXUHSURFHHGLQJ6HH
ILOHG D 1RWLFH RI )DLOXUH WR &RPSO\ ZLWK 3OHD $JUHHPHQW      86&  H  7KURXJKRXW WKH OHQJWK\ FRXUVH WKLV
7KRXJKWKHJRYHUQPHQWUHSRUWHGWKLVEUHDFKWRWKHGLVWULFW            SURVHFXWLRQWKHJRYHUQPHQWKDGDPSOHRSSRUWXQLW\WRSURWHFW
FRXUWDQGLQGLFDWHGWKDWLWZDVQRORQJHUERXQGWRKRQRUWKH          LWV FODLPHG LQWHUHVW LQ WKH IDUP SURSHUW\ E\ UHTXHVWLQJ D
SOHDDJUHHPHQWLWGLGQRWDFWXDOO\VHHNWRZLWKGUDZIURPWKDW        SURWHFWLYHRUGHUSXUVXDQWWR86&HRUE\WDNLQJ
DJUHHPHQW  5DWKHU WKH QRWLFH PHUHO\ JDYH 'HIHQGDQW WKH      RWKHUDSSURSULDWHVWHSVWRSURWHFWLWVLQWHUHVWEXWIDLOHGWRGR
RSSRUWXQLW\WRZLWKGUDZKLVJXLOW\SOHD'HIHQGDQWWKHQILOHG        VR
D 0RWLRQ WR (QIRUFH WKH 3OHD $JUHHPHQW  %XW WKH GLVWULFW
FRXUWDFNQRZOHGJHGWKDWWKHIDLOXUHRI'HIHQGDQWjVIDWKHUDQG           :HPXVWQRWHWKDW86&QZKLFKDIIRUGVGXH
VRQVWRSOHDGJXLOW\WRVWDWHFKDUJHVFRQVWLWXWHGDEUHDFKDQG        SURFHVV WR WKLUG SDUWLHV E\ DOORZLQJ WKHP WR DVVHUW WKHLU
GHFOLQHGWRHQIRUFHZKDWLWGHHPHGWREHDQmXQHQIRUFHDEOHl
SOHDDJUHHPHQW
                                                                          
   2QsXQH'HIHQGDQWILOHGD0RWLRQWR5HFRQVLGHU                 6XEVHFWLRQ H RI   SURYLGHV

7KLV&RXUWjV0HPRUDQGXPDQG2UGHU'DWHGsXQHRU                   8SRQ DSSOLFDWLRQ RI WKH 8QLWHG 6WDWHV WKH FRXUW PD\ HQWHU D
LQWKH$OWHUQDWLYH1RWLFHRI:LWKGUDZDORI3OHDs$DW           UHVWUDLQLQJ RUGHU RU LQMXQFWLRQ UHTXLUH WKH H[HFXWLRQ RI D
,QWKDWSOHDGLQJ'HIHQGDQWVWDWHGWKDWKLVZLWKGUDZDORIWKH              VDWLVIDFWRU\ SHUIRUPDQFH ERQG RU WDNH DQ\ RWKHU DFWLRQ WR
SOHD ZRXOG QRW EH D mYROXQWDU\ DFWl  7KH JRYHUQPHQW             SUHVHUYH WKH DYDLODELOLW\ RI SURSHUW\ GHVFULEHG LQ VXEVHFWLRQ D
UHVSRQGHG DQG XUJHG WKH GLVWULFW FRXUW WR SURFHHG WR              RI WKLV VHFWLRQ IRU IRUIHLWXUH XQGHU WKLV VHFWLRQ
                                                                          $ XSRQ WKH ILOLQJ RI DQ LQGLFWPHQW RU LQIRUPDWLRQ FKDUJLQJ D
VHQWHQFLQJ%XWRQ$XJXVWWKHGLVWULFWFRXUWHQWHUHG           YLRODWLRQ RI WKLV VXEFKDSWHU RU VXEFKDSWHU ,, RI WKLV FKDSWHU IRU
D PHPRUDQGXP DQG RUGHU ZLWKGUDZLQJ 'HIHQGDQWjV JXLOW\               ZKLFK FULPLQDO IRUIHLWXUH PD\ EH RUGHUHG XQGHU WKLV VHFWLRQ DQG
SOHDDQGVHWDWULDOGDWHRI2FWREHU$WWKLVSRLQW            DOOHJLQJ WKDW WKH SURSHUW\ ZLWK UHVSHFW WR ZKLFK WKH RUGHU LV
WKHWZRFLYLOIRUIHLWXUHDFWLRQVZHUHSHQGLQJDQG'HIHQGDQW               VRXJKW ZRXOG LQ WKH HYHQW RI FRQYLFWLRQ EH VXEMHFW WR IRUIHLWXUH
ZDVFKDUJHGLQWKHRQHFRXQWLQIRUPDWLRQ                                XQGHU WKLV VHFWLRQ RU
                                                                          % SULRU WR WKH ILOLQJ RI VXFK DQ LQGLFWPHQW RU LQIRUPDWLRQ LI
                                                                          DIWHU QRWLFH WR SHUVRQV DSSHDULQJ WR KDYH DQ LQWHUHVW LQ WKH
   0HDQZKLOHDVLJQLILFDQWGHFLVLRQLQDIRUIHLWXUHFDVHZDV             SURSHUW\ DQG RSSRUWXQLW\ IRU D KHDULQJ WKH FRXUW GHWHUPLQHV
LVVXHGE\RQHRIRXUVLVWHUFLUFXLWV7KH1LQWK&LUFXLW&RXUW            WKDW
RI$SSHDOVKHOGWKDWDFLYLOIRUIHLWXUHDFWLRQZDVEDUUHGE\WKH          L WKHUH LV D VXEVWDQWLDO SUREDELOLW\ WKDW WKH 8QLWHG 6WDWHV ZLOO
'RXEOHsHRSDUG\&ODXVHRIWKH)LIWK$PHQGPHQWEHFDXVHLW                  SUHYDLO RQ WKH LVVXH RI IRUIHLWXUH DQG WKDW IDLOXUH WR HQWHU WKH
FRQVWLWXWHG PXOWLSOH SXQLVKPHQW IROORZLQJ D GHIHQGDQWjV              RUGHU ZLOO UHVXOW LQ WKH SURSHUW\ EHLQJ GHVWUR\HG UHPRYHG IURP
                                                                          WKH MXULVGLFWLRQ RI WKH FRXUW RU RWKHUZLVH PDGH XQDYDLODEOH IRU
FRQYLFWLRQLQDSDUDOOHOFULPLQDOFDVHVWHPPLQJIURPWKHVDPH             IRUIHLWXUH DQG
FULPLQDO RIIHQVH  6HH 8QLWHG 6WDWHV Y  86          LL WKH QHHG WR SUHVHUYH WKH DYDLODELOLW\ RI WKH SURSHUW\ WKURXJK
&XUUHQF\)GWK&LUDPHQGHGE\                WKH HQWU\ RI WKH UHTXHVWHG RUGHU RXWZHLJKV WKH KDUGVKLS RQ DQ\
                                                                          SDUW\ DJDLQVW ZKRP WKH RUGHU LV WR EH HQWHUHG    
    8QLWHG6WDWHVY2j'HOO           1RV          1RV               8QLWHG6WDWHVY2j'HOO          

LW$WWKLVSRLQW'HIHQGDQWjVLQWHUHVWLQWKHIDUPSURSHUW\ZDV       )GWK&LUQRWLQJWKDWWKHJRYHUQPHQWFRXOG
WHUPLQDWHGDFFRUGLQJWRWKHWHUPVRIWKH(VFURZ$JUHHPHQW              VHHN IRUIHLWXUH DV SDUW RI D FULPLQDO SURVHFXWLRQ ZLWKRXW
                                                                        VXEMHFWLQJ GHIHQGDQWV        WR PXOWLSOH DQG VXFFHVVLYH
   :H DFNQRZOHGJH WKDW   KDV D UHODWLRQEDFN FODXVH         SURFHHGLQJV  2Q 2FWREHU   'HIHQGDQW ILOHG
SURYLGLQJWKDWm>D@OOULJKWWLWOHDQGLQWHUHVWLQWKHSURSHUW\        QXPHURXVSUHWULDOPRWLRQV7KHJRYHUQPHQWUHVSRQGHGRQ
>RZQHGE\WKHGHIHQGDQWZLWKLQWKHPHDQLQJRIVXEVHFWLRQ                2FWREHUZLWKDPRWLRQWRGLVPLVVWKHLQIRUPDWLRQ
D@YHVWVLQWKH8QLWHG6WDWHVXSRQWKHFRPPLVVLRQRIWKHDFW          mZLWKRXW SUHMXGLFHl RVWHQVLEO\ WR SXUVXH RWKHU FKDUJHV
JLYLQJ ULVH WR IRUIHLWXUH XQGHU WKLV VHFWLRQl   86&      DJDLQVW'HIHQGDQWDQGKLVIDPLO\PHPEHUVWKURXJKDJUDQG
 F  7KHUHIRUH WKH JRYHUQPHQW WDNHV WKH IRUIHLWHG        MXU\  7KH JRYHUQPHQW WKHQ DOHUWHG WKH GLVWULFW FRXUW WR LWV
SURSHUW\WKDWZDVLQWKHKDQGVRIWKHGHIHQGDQWDWWKHWLPHRI          GRXEOHMHRSDUG\FRQFHUQV2Q2FWREHUWKHGLVWULFW
WKHRIIHQVHQRWDWWKHWLPHRIFRQYLFWLRQ6HH,QUH)RUIHLWXUH       FRXUW JUDQWHG WKH JRYHUQPHQWjV PRWLRQ WR GLVPLVV WKH
+HDULQJ$VWR&DSOLQ	'U\VGDOH&KDUWHUHG)G               LQIRUPDWLRQ ZLWKRXW SUHMXGLFH  $W WKLV SRLQW WZR FLYLO
WK&LU,QUH0RIILWW=ZHUOLQJ	.HPOHU3&           IRUIHLWXUH DFWLRQV ZHUH SHQGLQJ RQH DJDLQVW 'HIHQGDQWµV
)6XSS('9DFI8QLWHG6WDWHVY             KRPHDW7RQDZDQGD7UDLODQGRQHDJDLQVWWKHDFUHIDUP
3DUFHORI/DQG%OGJV$SSXUWHQDQFHV DQG,PSURYHPHQWV                SURSHUW\DQGWKHUHZHUHQRFULPLQDOFKDUJHV
.QRZQDV%XHQD9LVWD$YH5XPVRQ1s86
&OHDUO\'HIHQGDQWKDGDQLQWHUHVWLQWKHIDUP               2Q'HFHPEHUDIHGHUDOJUDQGMXU\UHWXUQHGDIRXU
SURSHUW\DVRI$XJXVW%XWHYHQWKRXJK'HIHQGDQW              FRXQW LQGLFWPHQW DJDLQVW 'HIHQGDQW FKDUJLQJ KLP ZLWK WKH
ZDVVSHFLILFDOO\HQWLWOHGXQGHUWKHDJUHHPHQWWRSXUFKDVHWKH           IROORZLQJ&RXQW2QHSRVVHVVLRQRIPDULMXDQDZLWKLQWHQWWR
SURSHUW\E\FRQWLQXLQJWRPDNHSD\PHQWVKHORVWWKDWULJKW             GLVWULEXWHLQYLRODWLRQRI86&DDQGE%
\HDUV DJR E\ IDLOLQJ WR PDNH WLPHO\ PRUWJDJH SD\PHQWV          &RXQW 7ZR PDQXIDFWXULQJ PDULMXDQD LQ YLRODWLRQ RI 
7KHUHIRUHZHFDQQRWQRZRUGHUIRUIHLWXUHRIDQLQWHUHVWWKDW           86&  D DQG E% &RXQW 7KUHH DV RZQHU
QRORQJHUH[LVWV                                                       PDNLQJDQHQFORVXUHDYDLODEOHIRUPDQXIDFWXUHDQGVWRUDJHRI
                                                                        PDULMXDQDLQYLRODWLRQRI86&DQG&RXQW)RXUD
   7KDWWKHJRYHUQPHQWPHUHO\VWHSVLQWR'HIHQGDQWjVVKRHV              FULPLQDOIRUIHLWXUHDFWLRQSXUVXDQWWR86&VHHNLQJ
LVQRWGHEDWDEOH,Q8QLWHG6WDWHVY*XUOH\1RV            IRUIHLWXUH RI 'HIHQGDQWjV LQWHUHVW LQ WKH SURSHUW\ XVHG WR
   :/  WK &LU 1RY             FRPPLW WKH FULPHV 'HIHQGDQWjV KRPH DW  7RQDZDQGD
DGHIHQGDQWFRQWHVWHGWKHIRUIHLWXUHRIDPRWRUKRPH             7UDLODQGWKHDFUHIDUPSURSHUW\
RQWKHEDVLVWKDWWKHSURSHUW\EHORQJHGWRKLVFRPSDQ\DQG
QRWWRKLP7KHJRYHUQPHQWFRQFHGHGWKDWWKHGHIHQGDQWGLG               $IWHU WKH IRXUFRXQW LQGLFWPHQW ZDV UHWXUQHG WKH
QRW RZQ FHUWDLQ SURSHUW\ EXW VRXJKW WR UHWDLQ D FULPLQDO       JRYHUQPHQW PRYHG WR GLVPLVV WKH FLYLO IRUIHLWXUH DFWLRQ
IRUIHLWXUH RUGHU WR mPHUHO\ H[WLQJXLVK > @ DQ\ LQWHUHVWl WKH   SHQGLQJ DJDLQVW WKH DFUH IDUP SURSHUW\ FY
GHIHQGDQW mPD\ KDYHl LQ WKH VXEMHFW SURSHUW\  ,G DW       VHHNLQJ WR DYRLG SRVVLEOH GRXEOH MHRSDUG\ FRQFHUQV WKDW
DOWHUDWLRQLQRULJLQDOTXRWLQJ*RYHUQPHQW%ULHIDW:H          ZRXOGEDUWKHFULPLQDOSURVHFXWLRQ7KLVPRWLRQZDVJUDQWHG
XSKHOGWKHIRUIHLWXUHRUGHUUHFRJQL]LQJWKDWLWZRXOGQRWDIIHFW        RQ'HFHPEHUE\86'LVWULFWsXGJHsDPHV+sDUYLV
VXEVHTXHQW SURFHHGLQJV LQDVPXFK DV LW ZRXOG EH RI QR
FRQVHTXHQFHGXHWRWKHIDFWWKDWWKHGHIHQGDQWKDGQRLQWHUHVW
LQWKHSURSHUW\(VVHQWLDOO\WKHIRUIHLWXUHRUGHUZHXSKHOG               
                                                                             7KLV GHFLVLRQ ZDV ODWHU UHYHUVHG VXE QRP 8QLWHG 6WDWHV Y 8UVHU\
ZDVPHDQLQJOHVV7KLVUHVXOWKRZHYHUGRHVQRWFRPSHOXV               86   KROGLQJ WKDW LQ UHP FLYLO IRUIHLWXUHV ZHUH QHLWKHU
WRUHYHUVHWKHGLVWULFWFRXUWjVUHIXVDOWRHQWHUDPHDQLQJOHVV          SXQLVKPHQW QRU FULPLQDO SURFHHGLQJV IRU WKH SXUSRVHV RI WKH 'RXEOH
                                                                        sHRSDUG\ &ODXVH
     8QLWHG6WDWHVY2j'HOO          1RV          1RV                 8QLWHG6WDWHVY2j'HOO          

6XEVHTXHQWO\WKHJRYHUQPHQWDOVRVRXJKWGLVPLVVDOmZLWKRXW                     7HUPLQDWLRQRI'HIHQGDQWjVLQWHUHVWVXQGHUWKH
SUHMXGLFHl RI WKH UHPDLQLQJ FLYLO IRUIHLWXUH DFWLRQ DJDLQVW                (VFURZ$JUHHPHQW
'HIHQGDQWjV KRPH DW  7RQDZDQGD 7UDLO FY
7KRXJK'HIHQGDQWKDGSUHYLRXVO\RSSRVHGWKHFLYLOIRUIHLWXUH              7KHJRYHUQPHQWFRQWHQGVWKDWLWZDVHQWLWOHGWRDQRUGHU
FODLPKHFRQWHVWHGWKHJRYHUQPHQWjVPRWLRQWRGLVPLVVWKH             LPPHGLDWHO\IRUIHLWLQJZKDWHYHULQWHUHVWLQWKHIDUPSURSHUW\
FODLP,QIDFWKHXUJHGWKHGLVWULFWFRXUWWRNHHSWKHFLYLODQG     'HIHQGDQWKDGDVRI$XJXVWUHJDUGOHVVRIKRZWKLV
FULPLQDOSURFHHGLQJVVHSDUDWHOLNHO\LQDQHIIRUWWRSUHVHUYH         &RXUWFKRRVHVWRFKDUDFWHUL]HWKDWLQWHUHVW8QGHURUGLQDU\
WKHGRXEOHMHRSDUG\LVVXH'HIHQGDQWWKHQILOHGD0RWLRQIRU          FLUFXPVWDQFHV WKH EURDG PHDQLQJ RI WKH WHUP SURSHUW\ LQ
3DUWLDO6XPPDU\sXGJPHQWLQIDYRURIWKHJRYHUQPHQWRQWKH             DZRXOGUHTXLUHIRUIHLWXUHRIVXFKLQWHUHVWV%XWXQGHU
FLYLO IRUIHLWXUH DFWLRQ DJDLQVW KLV KRPH DW WKH 7RQDZDQGD      WKHXQLTXHFLUFXPVWDQFHVRIWKLVFDVHVXFKDQRUGHUZRXOGEH
7UDLO DGGUHVV  'HIHQGDQW VXEPLWWHG WKLV PRWLRQ WR 86        LPSRVVLEOHWRHQIRUFHEHFDXVHWKHLQWHUHVWKDGDOUHDG\EHHQ
'LVWULFWsXGJH7KRPDV*+XOOZKRZDVQRWDVVRFLDWHGZLWK             H[WLQJXLVKHGGXHWR'HIHQGDQWjVIDLOXUHWRIXOILOOWKHWHUPVRI
WKH FLYLO IRUIHLWXUH DFWLRQ DJDLQVW WKH IDUP SURSHUW\ ZKLFK   WKH (VFURZ $JUHHPHQW  $OWKRXJK WKH JRYHUQPHQW ZRXOG
ZDVDVVLJQHGWR86'LVWULFWsXGJHsDUYLV'HIHQGDQWWKHUHLQ         XVXDOO\EHHQWLWOHGWRWKLVSUHFLVHLQWHUHVWZHEHOLHYHWKHRUGHU
DVNHGWKHGLVWULFWFRXUWWRHQWHUSDUWLDOVXPPDU\MXGJPHQWIRU         ZRXOGKDYHEHHQPHDQLQJOHVVLQDVPXFKDVWKHUHZDVQRWKLQJ
WKH JRYHUQPHQW IDLOLQJ WR DOHUW WKH GLVWULFW FRXUW WR WKH    IRUWKHGLVWULFWFRXUWWRRUGHUIRUIHLWHG
JRYHUQPHQWjVGRXEOHMHRSDUG\FRQFHUQV'HIHQGDQWFODLPHG
WKDWKHZDQWHGWRmILQDOL]HKLVSRVLWLRQVRWKDWZH>VLF@FDQJHW        7KH(VFURZ$JUHHPHQWSURYLGHGWKDWLWZDVmWKHGHVLUHDQG
RQZLWKKLVOLIHl$IWHUWKHJRYHUQPHQWRSSRVHGWKHSDUWLDO           LQWHQWLRQ RI WKH VHOOHU >2j'HOO sU@ DQG WKH SXUFKDVHU
VXPPDU\MXGJPHQWPRWLRQWKHIRUIHLWXUHFDVHZDVDVVLJQHG              >'HIHQGDQW@WKDWWKHGHHGEHKHOGLQHVFURZXQWLODOORIWKH
WR sXGJH sRUGDQ  'HIHQGDQW DOVR ILOHG D 6XSSOHPHQWDO          LQGHEWHGQHVVVHFXUHGLQWKH'HHGRI7UXVWEHVDWLVILHGLQ
0HPRUDQGXPLQ2SSRVLWLRQWRWKH*RYHUQPHQWjV0RWLRQWR                 IXOODQGSDLGDQGWKHVDLGOLHQEHVXEMHFWWRUHOHDVHl(VFURZ
'LVPLVV:LWKRXW3UHMXGLFH,QWKDWPRWLRQ'HIHQGDQWDVNHG            $JUHHPHQW s$ DW   'HIHQGDQW PDLQWDLQHG KLV
WKHGLVWULFWFRXUWWRHQWHUVXPPDU\MXGJPHQWDQGDOOHJHGWKDW          LQWHUHVW E\ PDNLQJ WLPHO\ PRUWJDJH SD\PHQWV DQG SD\LQJ
$86$ &RRN KDG PDGH PDWHULDO PLVUHSUHVHQWDWLRQV XSRQ              WD[HV RQ WKH IDUP SURSHUW\  %XW WKH UHFRUG VKRZV WKDW
ZKLFK WKH GLVWULFW FRXUW KDG UHOLHG LQ GLVPLVVLQJ WKH SULRU   'HIHQGDQW GLG QRW FRQWLQXH WR VDWLVI\ WKRVH FRQGLWLRQV
FULPLQDO FDVH WKH LQIRUPDWLRQ  'HIHQGDQW VHUYHG WKH          6KRUWO\ DIWHU KLV DUUHVW RQ $XJXVW   KH VWRSSHG
JRYHUQPHQWZLWKWKUHHLQWHUURJDWRULHVDQGVXESRHQDHG$86$              PDNLQJ SD\PHQWV WR WKH EDQN KROGLQJ WKH 'HHG RI 7UXVW
&RRN VHHNLQJ WR REWDLQ LQIRUPDWLRQ RQ WKH SURVHFXWRULDO         $IWHU EHLQJ WKUHDWHQHG ZLWK IRUHFORVXUH E\ WKH EDQN
GHFLVLRQPDNLQJSURFHVV7KHJRYHUQPHQWILOHGDPRWLRQWR             2j'HOOsUHQIRUFHGWKHSRUWLRQRIWKHDJUHHPHQWDOORZLQJ
TXDVK  sXGJH sRUGDQ JUDQWHG WKH JRYHUQPHQWjV PRWLRQ WR        KLPWRUHFDOOWKHGHHGXSRQGHIDXOWE\'HIHQGDQWRUWKUHDWRI
TXDVK DQG GHQLHG 'HIHQGDQWjV PRWLRQ IRU SDUWLDO VXPPDU\         IRUHFORVXUH E\ WKH EDQN  2j'HOO sU WKHQ SDLG RII WKH
MXGJPHQW%XWKHDOVRGLVPLVVHGWKHFLYLOIRUIHLWXUHDFWLRQ           RXWVWDQGLQJGHEWREWDLQHGWKH:DUUDQW\'HHGDQGGHVWUR\HG
mZLWKSUHMXGLFHl2Q0D\WKHJRYHUQPHQWILOHGD
QRWLFHRIDSSHDOIURPWKLVRUGHUDQG'HIHQGDQWILOHGDFURVV
DSSHDORQ0D\RIWKHVDPH\HDU
                                                                       WKH ULJKW WR DOLHQDWH WKH SURSHUW\ LWVHOI LV RQH RI WKH LQGLFLD RI RZQHUVKLS
  'HIHQGDQWVXEVHTXHQWO\ILOHGQXPHURXVPRWLRQVWRGLVPLVV             RI SURSHUW\ 'HIHQGDQWjV ULJKW WR GLVSRVH RI KLV OLPLWHG LQWHUHVW LV QRW
WKHFULPLQDOFKDUJHVDJDLQVWKLPRQUHVMXGLFDWDDQGFROODWHUDO        WDQWDPRXQW WR WKH ULJKW WR DFWXDOO\ DOLHQDWH WKH IDUP SURSHUW\ LWVHOI :H
HVWRSSHO JURXQGV  2Q 6HSWHPEHU   sXGJH sRUGDQ         WKHUHIRUH GR QRW EHOLHYH WKDW WKH DELOLW\ WR GLVSRVH RI VXFK OLPLWHG ULJKWV
                                                                       PDQGDWHV D ILQGLQJ WKDW 'HIHQGDQW ZDV WKH RZQHU RI WKH SURSHUW\
     8QLWHG6WDWHVY2j'HOO                1RV            1RV            8QLWHG6WDWHVY2j'HOO       

)RU WKLV UHDVRQ ZH ILQG WKDW WKH GLVWULFW FRXUW FRUUHFWO\              GHQLHGUHOLHIRQPRVWRI'HIHQGDQWjVFODLPVEXWGLVPLVVHG
GHWHUPLQHGWKDW'HIHQGDQWZDVQRWWKHRZQHURIWKHSURSHUW\                    WKHSRUWLRQRI&RXQW)RXURIWKHFULPLQDOLQGLFWPHQWVHHNLQJ
                                                                                IRUIHLWXUHRIWKHUHVLGHQFHDW7RQDZDQGD7UDLO7KHQH[W
   1RQHWKHOHVVXQGHUWKHWHUPVRIWKH(VFURZ$JUHHPHQWRQ                    GD\'HIHQGDQWILOHGDQRWLFHRIDSSHDOSXUVXDQWWR$EQH\Y
$XJXVW'HIHQGDQWGLGKDYHDOLPLWHGLQWHUHVWLQWKH                    8QLWHG6WDWHV86SHUPLWWLQJLQWHUORFXWRU\
DFUHIDUPSURSHUW\,QHVVHQFH'HIHQGDQWKDGWKHULJKW                    DSSHDORQ D GRXEOHMHRSDUG\LVVXHLQFULPLQDOFDVHV7KH
WRPDNHWLPHO\PRQWKO\SD\PHQWVUHIOHFWLQJWKHRXWVWDQGLQJ                      FULPLQDO SURVHFXWLRQ ZDV VWD\HG DW 'HIHQGDQWjV UHTXHVW
EDODQFH GXH RQ WKH ORDQ DQG HYHQWXDOO\ RZQ WKH SURSHUW\                SHQGLQJWKHGLVSRVLWLRQRIWKHDSSHDO2Q2FWREHU
RXWULJKW XSRQ VDWLVIDFWLRQ RI WKH WHUPV RI WKH (VFURZ                   WKHJRYHUQPHQWILOHGDFURVVDSSHDOVHHNLQJUHLQVWDWHPHQWRI
$JUHHPHQW  6HH 7RZQ RI 'DQGULGJH Y 3DWWHUVRQ                      WKHSRUWLRQRI&RXQW)RXUWKDWZDVGLVPLVVHGE\sXGJHsDUYLV
6:G7HQQ&W$SSFRQVLGHULQJDVDQ
LVVXHRIILUVWLPSUHVVLRQWKHSURSHUW\LQWHUHVWRIWKHKROGHURI                  $SSUR[LPDWHO\ RQH \HDU ODWHU WKLV &RXUW LQ D SXEOLVKHG
DQXQH[HUFLVHGRSWLRQWRSXUFKDVHUHDOSURSHUW\LQYROYHGLQD                   RSLQLRQ UHYHUVHG sXGJH sDUYLVj GLVPLVVDO RI WKH FLYLO
FRQGHPQDWLRQSURFHHGLQJDQGKROGLQJWKDWWKHOLFHQVHIHDWXUH                    IRUIHLWXUHDFWLRQZLWKSUHMXGLFH6HH8QLWHG6WDWHVY2QH
RIDQRSWLRQFRQWUDFWFRQVWLWXWHVDOHJDOO\SURWHFWHGSURSHUW\                  7UDFWRI5HDO3URSHUW\)GWK&LU,QDQ
LQWHUHVWWDNLQJSULRULW\RYHUDFRQGHPQDWLRQSURFHHGLQJFI                  XQSXEOLVKHGRSLQLRQZHDIILUPHGWKHGHQLDORI'HIHQGDQWjV
/\QFK  6:G   KROGLQJ WKDW DQ RSWLRQ 
                                                              WR                PRWLRQ WR GLVPLVV RQ GRXEOH MHRSDUG\ JURXQGV  :H DOVR
SXUFKDVHSURSHUW\GRHVQRWFUHDWHDSUHVHQWLQWHUHVWLQODQG                  JUDQWHG WKH JRYHUQPHQWjV FURVVDSSHDO DQG UHYHUVHG sXGJH
                                                                                sDUYLVj GLVPLVVDO RI &RXQW )RXU WKH IRUIHLWXUH FRXQW
                                                                                UHPDQGLQJWKHFDVHWRWKHGLVWULFWFRXUW6HH8QLWHG6WDWHVY
     ([FHSW LQ WKH FDVH RI ZLOOV DQG FDVHV LQYROYLQJ D IXWXUH                   2j'HOO1RV:/WK&LU
     FRQWLQJHQF\ WKH FRQYHUVLRQ XVXDOO\ EHFRPHV HIIHFWLYH DW WKH               6HSW
     GDWH RI WKH FRQWUDFW RU GHHG LQGLFDWLQJ DQ LQWHQWLRQ WR FRQYHUW
     UHDO HVWDWH LQWR SHUVRQDOW\                                                 $IWHUWKHFDVHZDVUHPDQGHG'HIHQGDQWPRYHGWRGLVPLVV
     ,Q WKH FDVH RI RSWLRQV D IXWXUH FRQWLQJHQF\ QDPHO\ WKH HOHFWLRQ
     RI WKH RSWLRQHH WR WDNH XQGHU WKH RSWLRQ ZKLFK KH PD\ RU PD\
                                                                                RQ2FWREHUFODLPLQJDYLRODWLRQRIWKH6SHHG\7ULDO
     QRW GR DV KH FKRRVHV EHFRPHV WKH FRQWUROOLQJ IDFWRU DQG LW
                                                                                $FW  2Q 1RYHPEHU   WKH PDJLVWUDWH MXGJH ILOHG D
     VHHPV LOORJLFDO DQG XQQDWXUDO WR DVVXPH WKDW WKH RSWLRQRU                  5HSRUW DQG 5HFRPPHQGDWLRQ LQ ZKLFK KH FRQFOXGHG WKDW
     LQWHQGHG D FRQYHUVLRQ DW WKH GDWH RI WKH FRQWUDFW                         VHYHQW\IRXUGD\VKDGUXQRQWKH6SHHG\7ULDO$FWFORFN,Q
         WKH FXUUHQW DQG VRXQGHU UXOH LV WKDW FRQYHUVLRQ LV HIIHFWHG RQ      VR UHFRPPHQGLQJ WKH PDJLVWUDWH MXGJH QRWHG WKDW WKH
     WKH GDWH WKH RSWLRQHH HOHFWV WR H[HUFLVH KLV RSWLRQ ZKHQ IRU WKH
     ILUVW WLPH WKH REOLJDWLRQ WR FRQYH\ EHFRPHV DEVROXWH
                                                                                JRYHUQPHQWZDVWREODPHIRUGHOD\LQSURORQJLQJLWVPRWLRQ
                                                                                WR GLVPLVV WKH LQIRUPDWLRQ  7KH PDJLVWUDWH MXGJH WKHQ
/\QFK     6:G DW                                                     UHFRPPHQGHGGLVPLVVDORIDOOFRXQWVRIWKHLQGLFWPHQWZLWK
                                                                                SUHMXGLFH  7KH JRYHUQPHQW ILOHG WLPHO\ REMHFWLRQV WR WKLV
                                                                              5HSRUWDQG5HFRPPHQGDWLRQ2Q'HFHPEHUWKH
       ,Q LWV UHSO\ EULHI WKH JRYHUQPHQW FODLPV WKDW HYHQ LI 'HIHQGDQW
FRXOG QRW KDYH VROG RU RWKHUZLVH RI GLVSRVHG RI WKH SURSHUW\ DV LWV OHJDO       GLVWULFW FRXUW GLVPLVVHG ZLWK SUHMXGLFH &RXQW 7ZR
RZQHU KH FRXOG KDYH DW OHDVW DOLHQDWHG KLV OLPLWHG LQWHUHVW LQ WKH SURSHUW\   PDQXIDFWXULQJ PDULMXDQD DQG &RXQW 7KUHH XVH RI DQ
 &I 8QLRQ &DUELGH  6:G DW  m&DUELGH KDV QR LQWHUHVW XQGHU
                                                                                HQFORVXUHWRPDQXIDFWXUHDQGVWRUHPDULMXDQDEXWUHWDLQHG
WKH FRQWUDFW WKDW LW FDQ VHOO OHDVH RU RWKHUZLVH WUDQVIHU 7KH PHUH XVH E\
&DUELGH RI WKH UHDO SURSHUW\ IRU SXUSRVHV RI SHUIRUPLQJ WKH FRQWUDFW GRHV
                                                                                &RXQWV 2QH DQG )RXU RI WKH LQGLFWPHQW  7KDW VDPH GD\
QRW DPRXQW WR DQ LQFLGHQW RI RZQHUVKLSl 7KH (VFURZ $JUHHPHQW GRHV            'HIHQGDQW ILOHG D QRWLFH RI LQWHUORFXWRU\ DSSHDO DQG WKH
QRW VHHP WR UHVWULFW 'HIHQGDQWjV ULJKWV VXFK DV WR SUHFOXGH KLV DELOLW\ WR      JRYHUQPHQW ILOHG LWV RZQ QRWLFH RI DSSHDO  $JDLQ XSRQ
DOLHQDWH KLV OLPLWHG ULJKWV %XW WKLV DUJXPHQW LV LQDSSRVLWH LQDVPXFK DV
       8QLWHG6WDWHVY2j'HOO          1RV           1RV               8QLWHG6WDWHVY2j'HOO         

PRWLRQRI'HIHQGDQWWULDOZDVVWD\HGSHQGLQJGLVSRVLWLRQRI               GHOLYHU\RIWKHGHHGXSRQWKHKDSSHQLQJRIFHUWDLQFRQGLWLRQV
WKH DSSHDO  2Q $XJXVW   WKLV &RXUW GLVPLVVHG             RYHU ZKLFK KH KDG QR FRQWURO  8QGHU WKH JRYHUQPHQWjV
'HIHQGDQWjV DSSHDO EXW JUDQWHG WKH UHOLHI VRXJKW E\ WKH            FKDUDFWHUL]DWLRQXSRQGHOLYHU\RIWKH:DUUDQW\'HHGWRWKH
JRYHUQPHQWjVDSSHDOUHYHUVLQJWKHGLVWULFWFRXUWjVGLVPLVVDO              HVFURZ DJHQW 2j'HOO sU KDG QR SRZHU WR UHFDOO WKH GHHG
RI&RXQWV7ZRDQG7KUHHRQ6SHHG\7ULDO$FWJURXQGV6HH                  5DWKHUWKHJRYHUQPHQWFODLPVWKDW'HIHQGDQWKDGFRPSOHWH
8QLWHG6WDWHVY2j'HOO)GWK&LUFHUW               FRQWURO RYHU WKH XOWLPDWH GLVSRVLWLRQ RI WKH GHHG DQG WLWOH
GHQLHG867KHFDVHZDVWKHQUHPDQGHG                 EHFDXVH KH FRXOG KDYH HYHQWXDOO\ RZQHG WKH SURSHUW\ E\
IRU WULDO  2Q 6HSWHPEHU   DOWKRXJK WKH &RXUW RI         PDNLQJDOOWKHUHTXLUHGSD\PHQWV7KHUHIRUHWKHJRYHUQPHQW
$SSHDOVPDQGDWHKDGQRW\HWEHHQLVVXHG'HIHQGDQWILOHGD                 FRQWHQGVWKDW'HIHQGDQWFRXOGKDYHVROGOHDVHGUHQWHGRU
PRWLRQ WR GLVPLVV WKH LQGLFWPHQW FODLPLQJ KLV 6L[WK                RWKHUZLVHDOLHQDWHGWKHSURSHUW\VXEMHFWRQO\WRSD\PHQWRI
$PHQGPHQWULJKWWRDVSHHG\WULDOKDGEHHQYLRODWHG2QWKH               WKHPRUWJDJH%XWWKHVHULJKWVDUHQRWVWDWHGLQWKH(VFURZ
VDPHGD\'HIHQGDQWILOHGKLVILUVWVSHHG\WULDOPRWLRQ%XW              $JUHHPHQW QRU GRHV WKH JRYHUQPHQW FLWH DQ\ ODZIURP
GHVSLWHKLVDVVHUWLRQWKDWKHZDQWHGDVSHHG\WULDO'HIHQGDQW             7HQQHVVHHRURWKHUZLVHWRVXSSRUWWKLVSURSRVLWLRQ$VWKH
DOVRSHWLWLRQHGWKH&RXUWIRUDUHKHDULQJHQEDQFZKLFKZDV               GLVWULFWFRXUWQRWHG'HIHQGDQWFRXOGQRWKDYHVROGRUJLYHQ
REMHFWHGWRE\WKHJRYHUQPHQWDQGVXEVHTXHQWO\GHQLHGE\                   DZD\WLWOHWRWKHSURSHUW\RQ$XJXVWEHFDXVHKHGLG
WKLV&RXUW                                                                QRW KDYH VXFK WLWOH  &I 6KRORGJH  6:G DW 
                                                                           UHFRJQL]LQJ WKDW WKH SDUW\ FODLPLQJ DQ RZQHUVKLS LQWHUHVW
   2Q1RYHPEHUWKUHHGD\VDIWHUWKHGLVWULFWFRXUW               FRXOGQRWDOLHQDWHWKHSURSHUW\QRUFRXOGLWSUHYHQWWKHWUXH
UHJDLQHG MXULVGLFWLRQ WKH JRYHUQPHQW ILOHG D 0RWLRQ IRU            RZQHUIURPGRLQJVR5DWKHUWLWOHUHPDLQHGLQKLVIDWKHUjV
5XOLQJRQDOO3HQGLQJ0RWLRQVDQGIRU([SHGLWHG7ULDO'DWH                QDPHDQGWKH:DUUDQW\'HHGUHPDLQHGZLWKWKHHVFURZDJHQW
7KH JRYHUQPHQWjV PRWLRQ ZDV JUDQWHG DQG D WULDO GDWH RI
)HEUXDU\   ZDV VHW  2Q 'HFHPEHU   WKH               )XUWKHUPRUH ZH GHFOLQH WKH JRYHUQPHQWjV LQYLWDWLRQ WR
PDJLVWUDWH MXGJH ILOHG D 5HSRUW DQG 5HFRPPHQGDWLRQ                   DSSO\WKHGRFWULQHRIHTXLWDEOHFRQYHUVLRQLQWKLVFDVHm7KH
UHFRPPHQGLQJ WKDW 'HIHQGDQWjV 6L[WK $PHQGPHQW VSHHG\                  IRXQGDWLRQ IRU WKH GRFWULQH RI HTXLWDEOH FRQYHUVLRQ LV D
WULDOFODLPEHGHQLHG2Q)HEUXDU\'HIHQGDQWILOHG               SUHVXPHGLQWHQWLRQRIWKHRZQHUHTXLW\UHJDUGLQJDVGRQH
D FRQGLWLRQDO PRWLRQ IRU FRQWLQXDQFH RI WULDO VXJJHVWLQJ D        WKDWZKLFKRXJKWWREHGRQHl/\QFKY%XUJHU6:G
                                                                           7HQQ&W$SSVHHDOVR&DPSEHOOY0LOOHU
                                                                           6:G7HQQ&W$SS,QWKHLQVWDQW
                                                                          FDVH2j'HOOsUFOHDUO\LQWHQGHGWKDW'HIHQGDQWZRXOGKDYH
     ,Q WKDW FDVH ZH IRXQG WKDW WKH PDMRULW\ RI WKH WLPH SHULRG DOOHJHG   WKH ULJKW WR REWDLQ WKH SURSHUW\ IURP 2j'HOO sU VXEMHFW WR
ZDV H[FOXGDEOH IRU SXUSRVHV RI WKH 6SHHG\ 7ULDO $FW                       VDWLVIDFWLRQ RI WKH WHUPV RI WKH (VFURZ $JUHHPHQW  7KXV
                                                                           LQDVPXFKDV'HIHQGDQWIDLOHGWROLYHXSWRWKRVHWHUPVmWKDW
                                                                           ZKLFKRXJKWWREHGRQHlKDVDOUHDG\EHHQGRQHLQWKLVFDVH
     %HFDXVH WKH SODLQ PHDQLQJ RI WKH VWDWXWRU\ ODQJXDJH UHTXLUHV D
     QRW JXLOW\ SOHD >LQ RUGHU WR VWDUW WKH VSHHG\ WULDO FORFN IRU
     SXUSRVHV RI WKH 6SHHG\ 7ULDO $FW  86&  F@ DQG
     2j'HOO GLG QRW HQWHU RQH QRU ZDV RQH HQWHUHG IRU KLP GXULQJ WKH
      FDVH ZH KROG WKDW WKH 67$ FORFN ZDV QRW WULJJHUHG GXULQJ
                                                                               
     WKH  FDVH 7KXV WKH 'LVWULFW &RXUW LQFRUUHFWO\ KHOG WKDW                :H GHFOLQH WR HQWHUWDLQ WKH JRYHUQPHQWjV FRQWHQWLRQ WKDW
     VL[W\WKUHH GD\V RI QRQH[FOXGDEOH WLPH HODSVHG GXULQJ WKH         'HIHQGDQW VKRXOG EH FRQVLGHUHG WKH RZQHU RI WKH SURSHUW\ DV RI WKH GDWH
     FDVH 5HPRYLQJ WKHVH VL[W\WKUHH GD\V IURP WKH 67$ FORFN              WKH (VFURZ $JUHHPHQW ZDV H[HFXWHG ,Q /\QFK Y %XUJHU WKH 7HQQHVVHH
     OHDYHV RQO\ WKLUW\ GD\V DW LVVXH                                     &RXUW RI $SSHDOV H[SODLQHG WKH DSSOLFDELOLW\ RI WKH HTXLWDEOH FRQYHUVLRQ
                                                                           GRFWULQH WR DJUHHPHQWV LQ ZKLFK D SDUW\ KDV WKH RSWLRQ WR SXUFKDVH ODQG
2j'HOO    )G DW 
    8QLWHG6WDWHVY2j'HOO           1RV           1RV              8QLWHG6WDWHVY2j'HOO       

   %XWLQGHFLGLQJ6KRORGJHWKHFRXUWRIDSSHDOVUHOLHGFKLHIO\         WULDOGDWHLQHDUO\$SULO2YHUWKHJRYHUQPHQWjVREMHFWLRQWKH
RQWKH7HQQHVVHH6XSUHPH&RXUWjVGHFLVLRQLQ8QLRQ&DUELGH               GLVWULFWFRXUWJUDQWHGWKHPRWLRQEXWGHOD\HGWKHWULDORQO\
Y$OH[DQGHU6:G7HQQ,QFRQVLGHULQJ               XQWLO0DUFK2Q)HEUXDU\WKHGLVWULFWFRXUW
ZKHWKHU WKH 8QLRQ &DUELGH FRUSRUDWLRQ KDG D WD[DEOH               DGRSWHGWKHUHSRUWRIWKHPDJLVWUDWHMXGJHUHFRPPHQGLQJWKDW
RZQHUVKLS LQWHUHVW  LQ D SDUFHO RI UHDO SURSHUW\ ZKLFK LW      'HIHQGDQWjV 6L[WK $PHQGPHQW VSHHG\ WULDO FODLP EH
PDQDJHG DQG RSHUDWHG WKH 7HQQHVVHH 6XSUHPH &RXUW                  GLVPLVVHG
GLVFXVVHGWKHVL[EDVLFULJKWVDVVRFLDWHGZLWKWKHRZQHUVKLS
RISURSHUW\                                                               2QWKHPRUQLQJRIWULDO'HIHQGDQWZDLYHGKLVULJKWWRD
                                                                         MXU\WULDODQGWKHFDVHZDVWULHGEHIRUHsXGJHsRUGDQ$WWULDO
  ,Q D SURSHUW\ DVVHVVPHQW PDQXDO ,QWHUQDWLRQDO                    'HIHQGDQWGLGQRWFRQWHVWKLVJXLOWRQ&RXQWV2QHSRVVHVVLRQ
  $VVRFLDWLRQRI$VVHVVLQJ2IILFHUV3URSHUW\$VVHVVPHQW                 RIPDULMXDQDZLWKLQWHQWWRGLVWULEXWHRU7ZRPDQXIDFWXULQJ
  9DOXDWLRQLWLVVDLGWKDWWKHUHDUHVL[EDVLFULJKWV          PDULMXDQD%XW'HIHQGDQWDUJXHGWKDWKHZDVQRWJXLOW\RI
  DVVRFLDWHGZLWKWKHRZQHUVKLSRISURSHUW\WKHULJKW               &RXQW 7KUHH DV RZQHU PDNLQJ DQ HQFORVXUH DYDLODEOH IRU
  WRXVHWKHULJKWWRVHOOWKHULJKWWROHDVHRUUHQW         PDQXIDFWXULQJ DQG VWRULQJ PDULMXDQD DQG WKDW WKH GLVWULFW
  WKHULJKWWRHQWHURUOHDYHWKHULJKWWRJLYHDZD\           FRXUW VKRXOG QRW RUGHU IRUIHLWXUH RI WKH DFUH IDUP
  WKHULJKWWRUHIXVHWRGRDQ\RIWKHVH                            SURSHUW\  2Q 0D\   WKH GLVWULFW FRXUW HQWHUHG D
                                                                         PHPRUDQGXPDQGRUGHUILQGLQJ'HIHQGDQWJXLOW\RQ&RXQWV
,GDW$OWKRXJKQRWLQJWKDW8QLRQ&DUELGHKDGWKHULJKWV           2QHDQG7ZREXWQRWJXLOW\RQ&RXQW7KUHH'HIHQGDQWILOHG
WRXVHWKHSURSHUW\WRSHUIRUPDFRQWUDFWWKHFRXUWIRXQGWKDW          DQDSSHDORIWKHMXGJPHQWUHJDUGLQJ&RXQWV2QHDQG7ZR
WKHFRUSRUDWLRQGLGQRWRZQWKHSURSHUW\IRUWD[DVVHVVPHQW              GRFNHWHGDV&DVH1R
SXUSRVHV  ,Q VR KROGLQJ WKH FRXUW QRWHG WKDW mWKH ULJKW WR
DOLHQDWHLVDQLPSRUWDQWHOHPHQWRIRZQHUVKLSlIRULQERWK                   %&DVH1R$SSOLFDWLRQRIWKH6DIHW\
8QLRQ&DUELGHDQGLQ6KRORGJHWKHSDUWLHVDOOHJHGO\KDYLQJ                             9DOYHDQG5HGXFHG6HQWHQFH
DQRZQHUVKLSLQWHUHVWFRXOGQRWDOLHQDWHWKHSURSHUW\,GDW
FLWLQJ$0 s85G3URSHUW\DW                 'HIHQGDQWjV SUHVHQWHQFH LQYHVWLJDWLRQ UHSRUW m36,5l
6LPLODUO\LQ6KRORGJHWKH7HQQHVVHH&RXUWRI$SSHDOVIRXQG              LQGLFDWHG WKDW WKH PDQGDWRU\ PLQLPXP SURYLVLRQV RI 
WKDWWKHULJKWWRXVHDQGHQWHURUOHDYHWKHSUHPLVHVGLGQRW            86&  E% DSSOLHG FDOOLQJ IRU D WHUP RI
FRQVWLWXWH VXIILFLHQW LQGLFLD RI RZQHUVKLS  6KRORGJH         LPSULVRQPHQW RI QR OHVV WKDW ILYH  \HDUV  36,5 DW 
6:GDW                                                           'HIHQGDQWREMHFWHGWRWKLVUHSRUWDQGVRXJKWDSSOLFDWLRQRI
                                                                         WKH VDIHW\ YDOYH SURWHFWLRQ RI  86&  I ZKLFK
  ,Q WKH LQVWDQW FDVH WKH JRYHUQPHQW EDOGO\ DVVHUWV WKDW        ZRXOGSURYLGHDVHQWHQFHEHORZWKHILYH\HDUPLQLPXP7KH
'HIHQGDQWSRVVHVVHGDOOVL[RIWKHVHEDVLFULJKWVRIRZQHUVKLS           JRYHUQPHQW UHVSRQGHG WR WKHVH REMHFWLRQV DVVHUWLQJ WKDW
DQGWKDWKLVIDWKHUUHWDLQHGQRQHRIWKHP7KHSDUWLHVGRQRW           'HIHQGDQWGLGQRWPHHWWKHILIWKFULWHULRQIRUWKHVDIHW\YDOYH
GLVSXWHWKDW'HIHQGDQWSRVVHVVHGPRVWRIWKHVHULJKWVSULRUWR           EHFDXVHKHGLGQRWSURYLGHDOOLQIRUPDWLRQDQGHYLGHQFHKH
'HIHQGDQWjVGHIDXOWDQGWKHUHFDOORIWKHGHHGE\2j'HOOsU            KDGFRQFHUQLQJWKHRIIHQVHWKDWZHUHSDUWRIWKHVDPHFRXUVH
%XW WKH ULJKW WR DOLHQDWH LV D PDWWHU RI VRPH FRQWHQWLRQ      RI FRQGXFW RU RI D FRPPRQ VFKHPH RU SODQ 'HIHQGDQWjV
$FFRUGLQJ WR WKH JRYHUQPHQWjV WKHRU\ RQFH WKH (VFURZ             FRRSHUDWLRQ FRQVLVWHG FKLHIO\ RI XQKHOSIXO LQIRUPDWLRQ
$JUHHPHQW ZDV H[HFXWHG WKH JUDQWHH 'HIHQGDQW KDG D             SURYLGHGRQO\KRXUVEHIRUHKLVVHQWHQFLQJKHDULQJ'HIHQGDQW
VXSHULRULQWHUHVWLQWKHSURSHUW\7KHJRYHUQPHQWDOOHJHVWKDW          UHIXVHGWRDQVZHUTXHVWLRQVDERXWPDULMXDQDJURZLQJDFWLYLW\
RQO\RQHULJKWZDVUHWDLQHGE\2j'HOOsUWKHULJKWWRUH            DVLGHIURPWKDWXQGHUWDNHQLQWKHEDUQRQWKHIDUPSURSHUW\
    8QLWHG6WDWHVY2j'HOO          1RV         1RV             8QLWHG6WDWHVY2j'HOO        

7KHJRYHUQPHQWIXUWKHUDOOHJHGWKDWHYHQLIWKHVDIHW\YDOYH          (DUO\7HQQHVVHHFDVHODZDUWLFXODWHVWKHQDWXUHRIGHOLYHU\LQ
DSSOLHG D VHQWHQFH EHORZ WKH PLQLPXP RI WZHQW\IRXU           WUDQVDFWLRQVJRYHUQHGE\DQHVFURZDJUHHPHQW
PRQWKVZRXOGEHLQHUURU
                                                                        $QHVFURZLVFRQFLVHO\GHILQHGDVDFRQGLWLRQDOGHOLYHU\
  'HVSLWHWKHJRYHUQPHQWjVFRQFHUQVWKHGLVWULFWFRXUWIRXQG           RIDGHHGWRDVWUDQJHUDQGQRWWRWKHJUDQWHHKLPVHOI
WKDW 'HIHQGDQW HVWDEOLVKHG HOLJLELOLW\ IRU WKH VDIHW\ YDOYH     XQWLOFHUWDLQFRQGLWLRQVVKDOOEHSHUIRUPHGDQGWKHQLWLV
WKHUHE\DYRLGLQJWKHPDQGDWRU\PLQLPXPVHQWHQFHRIILYH                WR EH GHOLYHUHG WR WKH JUDQWHH  8QWLO WKH FRQGLWLRQ LV
\HDUV7KHGLVWULFWFRXUWWKHQDSSOLHGDVHQWHQFLQJUDQJHRI          SHUIRUPHGDQGWKHGHHGGHOLYHUHGRYHUWKHHVWDWHGRHV
HLJKWHHQ WR WZHQW\IRXU PRQWKV XOWLPDWHO\ VHQWHQFLQJ              QRWSDVVEXWUHPDLQVLQWKHJUDQWRU
'HIHQGDQWWRHLJKWHHQPRQWKV7KHJRYHUQPHQWILOHGDQRWLFH
RIDSSHDORQWKHVDIHW\YDOYHDQGVHQWHQFLQJLVVXHZKLFKZDV         3DUURWWY3DUURWW7HQQ:/DW7HQQ
GRFNHWHGDV&DVH1R                                         HPSKDVLVDGGHG,IGHOLYHU\LVFRQGLWLRQDOWKHUHKDV
                                                                      EHHQQRGHOLYHU\XQWLOWKHFRQGLWLRQKDVEHHQVDWLVILHG6HH
        &&DVH1R&ULPLQDO)RUIHLWXUH                    ,GDW7KXVWKHSUHVXPSWLRQRIGHOLYHU\GRHVQRWDSSO\
                                                                      LQWKLVFDVHDQG'HIHQGDQWGLGQRWKDYHOHJDOWLWOHWRWKHIDUP
   :LWKUHVSHFWWR&RXQW)RXURIWKHLQGLFWPHQWWKHGLVWULFW         SURSHUW\
FRXUW RUGHUHG WKDW 'HIHQGDQWjV LQWHUHVW LQ WKH UHVLGHQWLDO
SURSHUW\DW7RQDZDQGD7UDLOEHIRUIHLWHGEXWGHFOLQHGWR            7KH JRYHUQPHQW FRQWHQGV WKDW WKH GLVWULFW FRXUW HUUHG LQ
RUGHUIRUIHLWXUHRI'HIHQGDQWjVLQWHUHVWLQWKHDFUHIDUP         IRFXVLQJHQWLUHO\RQEDUHOHJDOWLWOHDQGWKDWLWVKRXOGKDYH
SURSHUW\'HIHQGDQWjVUHODWLRQVKLSWRWKLVSURSHUW\GDWHVEDFN       JLYHQJUHDWHUZHLJKWWRWKHIDFWWKDW'HIHQGDQWKDGGRPLQLRQ
WR 2FWREHU    2Q WKDW GDWH 'HIHQGDQWjV IDWKHU      DQGFRQWURORYHUWKHSURSHUW\,QVXSSRUWRIWKLVDUJXPHQWWKH
sDFNVRQ&2j'HOOsUH[HFXWHGD:DUUDQW\'HHGFRQYH\LQJ            JRYHUQPHQW UHOLHV RQ D EURDGHU GHILQLWLRQ RI WKH WHUP
WKHDFUHIDUPSURSHUW\WR'HIHQGDQW7KLVGHHGZDVQRW           mRZQHUVKLSl XVHG E\ WKH 7HQQHVVHH &RXUW RI $SSHDOV LQ
UHFRUGHGEXWZDVGHOLYHUHGWRDQHVFURZDJHQWSXUVXDQWWRD          )UDQN5XG\+HLUV$VVRFLDWHVY6KRORGJH,QF6:G
(VFURZ$JUHHPHQWEHWZHHQ'HIHQGDQWDQGKLVIDWKHU               7HQQ&W$SS,Q6KRORGJHWKHFRXUWFRQVLGHUHG
7KH(VFURZ$JUHHPHQWSURYLGHGWKDWWKHGHHGZDVWREHKHOG            D FODLP E\ D OLPLWHG SDUWQHUVKLS WKDW LWV JHQHUDO SDUWQHU
LQHVFURZXQWLO'HIHQGDQWVDWLVILHGKLVIDWKHUjVLQGHEWHGQHVV         EUHDFKHGDFRQWUDFWXDODJUHHPHQWE\REWDLQLQJDQRZQHUVKLS
RQWKHSURSHUW\WRWKH)HGHUDO/DQG%DQNDWZKLFKWLPHWKH           LQWHUHVWLQDFRPSHWLQJHQWHUSULVH,QILQGLQJWKDWWKHSDUWQHU
HVFURZ DJHQW ZRXOG EH DXWKRUL]HG WR GHOLYHU WKH GHHG WR      GLG QRW DFTXLUH DQ RZQHUVKLS LQWHUHVW WKH FRXUW RI DSSHDOV
'HIHQGDQW  7KH (VFURZ $JUHHPHQW DOVR SURYLGHG WKDW            H[SODLQHGWKDWm>W@KHWHUPµRZQHUVKLSjKDVEHHQJLYHQDZLGH
2j'HOOsUFRXOGUHFODLPWKHGHHGLI'HIHQGDQWIDLOHGWRPHHW        UDQJHRIPHDQLQJEXWLVRIWHQVDLGWRFRPSUHKHQGERWKWKH
WKH WHUPV RI WKH DJUHHPHQW ZKLFK UHTXLUHG 'HIHQGDQW WR       FRQFHSWVRISRVVHVVLRQDQGIXUWKHUWKDWRIWLWOHDQGWKXVEH
PDNHFRQVLVWHQWDQGSURPSWSD\PHQWVWRWKHEDQNKROGLQJWKH           EURDGHU WKDQ HLWKHUl  ,G DW  FLWLQJ %$5521j6 /$:
'HHGRI7UXVWRQWKHSURSHUW\                                        ',&7,21$5<GHG7KHFRXUWDOVRFLWHG%ODFNjV
                                                                      /DZ'LFWLRQDU\ZKLFKGHILQHVWKHWHUPmRZQlDVmWRKDYH
  'HIHQGDQWKDGFRQWLQXRXVSRVVHVVLRQRIWKHIDUPSURSHUW\            JRRGOHJDOWLWOHWRKROGDVSURSHUW\WRKDYHDOHJDORUULJKWIXO
IRUDSSUR[LPDWHO\IRXUWHHQ\HDUV'HIHQGDQWjVIDWKHUHYHQ            WLWOHWRWRKDYHWRSRVVHVVl%/$&.j6 /$: ',&7,21$5<
WHVWLILHGWKDWKHZDVVRPHWLPHVGHQLHGDFFHVVWRWKHLQWHULRU         WKHG7KXVWKHFRXUWUHFRJQL]HGWKDWWKHmRUGLQDU\
RIWKHIDUP)URPWKHWLPHWKHGHHGZDVSODFHGLQHVFURZ             DQG XVXDO PHDQLQJ RI RZQHUVKLS LV µSRVVHVVLRQj RU µOHJDO
XQWLO WKH H[HFXWLRQ RI WKH VHDUFK ZDUUDQWV 'HIHQGDQW          WLWOHjl6KRORGJH6:GDW
PDLQWDLQHGWKHDFUHIDUPSURSHUW\DQGSDLGWKHPRUWJDJH
    8QLWHG6WDWHVY2j'HOO             1RV            1RV             8QLWHG6WDWHVY2j'HOO       

        'HIHQGDQWjV,QWHUHVWLQWKH)DUP3URSHUW\                         WD[HV DQG XWLOLW\ ELOOV  $IWHU 'HIHQGDQWjV DUUHVW WKH
                                                                            JRYHUQPHQWLQVWLWXWHGDFLYLOIRUIHLWXUHDFWLRQDJDLQVWWKHIDUP
   7KH GLVWULFW FRXUW ILUVW IUDPHG LWV LQTXLU\ LQ WHUPV RI        SURSHUW\6RRQDIWHUWKDWDFWLRQZDVILOHG'HIHQGDQWILOHGD
ZKHWKHU'HIHQGDQWDFTXLUHGOHJDOWLWOHWRWKHIDUPSURSHUW\                YHULILHG FODLP  WKDW KH ZDV mHQWLWOHG WR RZQHUVKLS LQ WKH
6XFK D KROGLQJ ZRXOG UHTXLUH D ILQGLQJ WKDW WKH :DUUDQW\           VHL]HGSURSHUW\DVWKHRZQHURIVDLGSURSHUW\l'HIHQGDQW
'HHGKDGEHHQmGHOLYHUHGlWR'HIHQGDQWVXFKWKDWKHRZQHG                   FHDVHGPDNLQJSD\PHQWVRQWKHSURSHUW\DIWHUKLVDUUHVWDQG
RUKDGDOHJDOLQWHUHVWLQWKHSURSHUW\7HQQHVVHHFRXUWVKDYH             2j'HOOsUSDLGRIIWKHEDODQFHRIWKHORDQ%XW'HIHQGDQW
ORQJ KHOG WKDW mWKH GHOLYHU\ RI D GHHG IURP D JUDQWRU WR D      VWLOO FODLPHG WR RZQ WKH SURSHUW\ LQ KLV sDQXDU\ 
JUDQWHH LV HVVHQWLDO WR SDVV WLWOH WR WKH JUDQWHHl  (VWDWH RI   VXPPDU\MXGJPHQWPRWLRQDQGDWDVXSSUHVVLRQKHDULQJRQ
$WNLQVRQY$OOLHG)HQFHDQG,PSURYHPHQW&RPSDQ\,QF                     0DUFK2Q0DUFKKRZHYHUWKHGD\EHIRUH
6:G7HQQ&W$SS7REHHIIHFWLYH                WULDO'HIHQGDQWILOHGD1RWLFHRI'LVFORVXUHDQG5HWUDFWLRQ
GHOLYHU\PXVWGHSULYHWKHJUDQWRURISRZHUWRUHFDOOWKHGHHG              UHYHUVLQJKLVORQJVWDQGLQJSRVLWLRQUHJDUGLQJKLVRZQHUVKLS
DQGGHOLYHU\LVFRPSOHWHRQO\ZKHUHWKHJUDQWRUKDVSXWWKH                 RI WKH DFUH SURSHUW\  ,Q WKLV QRWLFH 'HIHQGDQW
GHHGEH\RQGKLVSRZHUWRUHYRNHRUFODLPLW6HH&RXFKY                  DFNQRZOHGJHGWKDWDWWKHVWDUWRIWULDOKHWKRXJKWKHZDVWKH
+RRYHU6:G7HQQ&W$SS%XWFI                  RZQHU RI WKH IDUP SURSHUW\ EXW PDLQWDLQHG WKDW KH QHYHU
)DUUDU Y %ULGJHV  7HQQ  +XP                  RZQHGWKHIDUPSURSHUW\XQGHU7HQQHVVHHODZ
KROGLQJWKDWVLJQLQJVHDOLQJDQGDWWHVWDWLRQRIDGHHGZLOO
PDNHLWFRPSOHWHDQGHIIHFWXDODOWKRXJKWKHLQVWUXPHQWPD\                    %RWK SDUWLHV DJUHHG WKDW WKH LVVXH RI ZKHWKHU WKH IDUP
EHOHIWLQWKHSRVVHVVLRQRIWKHJUDQWRU8QGHU7HQQHVVHH                 SURSHUW\ ZDV RZQHG E\ GHIHQGDQW UHTXLUHG VRPH IDFWXDO
ODZ GHOLYHU\ LV D TXHVWLRQ RI WKH LQWHQWLRQ RI WKH SDUWLHV      ILQGLQJVDQGDVNHGWKHGLVWULFWFRXUWWRKHDUHYLGHQFHRQWKLV
ZKLFKPD\EHLQIHUUHGIURPWKHFLUFXPVWDQFHV$OOLHG)HQFH                LVVXH  7KH\ DOVR DJUHHG WKDW WKH UHOHYDQW WLPH SHULRG IRU
6:GDW&I(DUO\Y6WUHHW6:G                GHWHUPLQLQJ RZQHUVKLS ZDV $XJXVW  WKH GDWH
7HQQKROGLQJWKDWGHOLYHU\LVDPDWWHURILQWHQWLRQWR             'HIHQGDQW FRPPLWWHG WKH FULPLQDO DFWV JLYLQJ ULVH WR WKH
EHGHWHUPLQHGIURPWKHJUDQWRUjVZRUGVDQGFRQGXFW7KH                   IRUIHLWXUHFODLP  $IWHUKHDULQJHYLGHQFHRQWKHRZQHUVKLS
(VFURZ $JUHHPHQW LQ WKH FDVH DW EDU UHIOHFWV WKH SDUWLHVj          LVVXHZKLFKZDVLQWHJUDOWR&RXQW7KUHHDVRZQHUPDNLQJ
LQWHQW WKDW WKH GHHG QRW EH GHOLYHUHG WR 'HIHQGDQW XQWLO           WKH SURSHUW\ DYDLODEOH IRU PDQXIDFWXUH RI PDULMXDQD WKH
VDWLVIDFWLRQRIWKHUHPDLQLQJPRQWKO\PRUWJDJHSD\PHQWV                    GLVWULFWFRXUWGHFOLQHGWRRUGHUIRUIHLWXUHILQGLQJLQVWHDGWKDW
                                                                            2j'HOOsURZQHGWKHSURSHUW\DWWKHWLPHLQTXHVWLRQ
   ,Q DGGLWLRQ SRVVHVVLRQ DQG UHFRUGDWLRQ RI D SURSHUO\
H[HFXWHG DQG DFNQRZOHGJHG GHHG E\ WKH JUDQWHH LV SULPD                                       ',6&866,21
IDFLHHYLGHQFHRIGHOLYHU\DEVHQWRSSRVLQJFLUFXPVWDQFHV
6HH(VWDWHRI$WNLQVRQ6:GDWsRQHVYsRQHV                        ,&DVH1R6,;7+$0(1'0(17
6:G7HQQ,QWKHLQVWDQWFDVHLWLV                               63(('<75,$/&/$,0
FOHDUWKDW'HIHQGDQWZDVQRWWKHUHFRUGRZQHURIWKHSURSHUW\
RQ WKH GD\ LQ TXHVWLRQ DQG WKDW KH GLG QRW KDYH SK\VLFDO           2QFURVVDSSHDO'HIHQGDQWFKDOOHQJHVWKHGLVWULFWFRXUWjV
SRVVHVVLRQ RI WKH:DUUDQW\'HHGSXUSRUWLQJWRFRQYH\WKH                  GHQLDORIKLVUHTXHVWWRGLVPLVVWKHFULPLQDOLQGLFWPHQWGXHWR
IDUP SURSHUW\ WR KLP  7KRXJK 2j'HOO sU VLJQHG WKH               DQDOOHJHGYLRODWLRQRIWKH6L[WK$PHQGPHQWjVVSHHG\WULDO
:DUUDQW\'HHGRYHUWR'HIHQGDQWWKHGHHGZDVQRWGHOLYHUHG                 SURYLVLRQ)RUWKHIROORZLQJUHDVRQVZHDIILUPWKHGLVWULFW
WR'HIHQGDQWEHFDXVHLWZDVGHSRVLWHGZLWKWKHHVFURZDJHQW                FRXUWjVGHQLDORI'HIHQGDQWjVPRWLRQWRGLVPLVV
    8QLWHG6WDWHVY2j'HOO           1RV           1RV              8QLWHG6WDWHVY2j'HOO        

                                 $                                        SXUFKDVHURIWKLVSURSHUW\>'HIHQGDQW@DQG WKHHVFURZ
                                                                           DJUHHPHQWZLOOWKHUHE\EHWHUPLQDWHG,QWKHHYHQWWKDW
  m7KLV&RXUWH[DPLQHVGHQRYRWKHFRQVWLWXWLRQDOTXHVWLRQ                 WKH SXUFKDVHU VKRXOG IDLO WR PHHW WKH SD\PHQWV RI WKH
RI ZKHWKHU D GHIHQGDQW KDV EHHQ GHQLHG D VSHHG\ WULDO LQ         IHGHUDO/DQG%DQNZKHQGXHDQGLILWVKRXOGDSSHDUWR
YLRODWLRQRIWKH6L[WK$PHQGPHQWl8QLWHG6WDWHVY%URZQ                WKHHVFURZDJHQWRUWRWKHVHOOHU>'HIHQGDQWjVIDWKHU@
)GWK&LUTXRWLQJ8QLWHG6WDWHVY                WKDWVDLGGHIDXOWKDGFRQWLQXHGIRUDSHULRGRIQLQHW\
6PLWK  )G   WK &LU   +RZHYHU WKH          GD\VRUIRUDVPDOOHUSHULRGLIWKHKROGHURIVDLGOLHQ
GLVWULFWFRXUWjVIDFWXDOILQGLQJVDUHUHYLHZHGIRUFOHDUHUURU            VKRXOGEHWKUHDWHQLQJZLWKRUSURFHHGLQJWRIRUHFORVH
6HHLG                                                                    WKHQ DQG LQ WKDW HYHQW WKH HVFURZ DJHQW LV KHUHE\
                                                                           DXWKRUL]HGWRUHGHOLYHUVDLGGHHGWRWKHVHOOHU,IWKH
                                 %                                        VHOOHU VKRXOG SD\ WKH LQGHEWHGQHVV GXH WR WKH )HGHUDO
                                                                           /DQG%DQNDVFRQWHPSODWHGKHUHLQSULRUWRLWVGXHGDWH
  7KH6L[WK$PHQGPHQW WRWKH8QLWHG6WDWHV&RQVWLWXWLRQ                   WKHQWKHGHHGVKDOOEHGHOLYHUHGWRKLPRQVDWLVIDFWRU\
JXDUDQWHHVWKDWm>L@QDOOFULPLQDOSURVHFXWLRQVWKHDFFXVHG               HYLGHQFHRIVXFKSD\PHQWDQGWKHUHOHDVHRIOLHQVHFXULQJ
VKDOO HQMR\ WKH ULJKW WR D VSHHG\ DQG SXEOLF WULDOl  86      WKHVDPH
&2167 DPHQG 9,  :H QRWH WKDW 'HIHQGDQW KDV DOUHDG\
DVVHUWHGDQGIDLOHGRQDFODLPXQGHUWKH6SHHG\7ULDO$FW            (VFURZ$JUHHPHQWs$DW$OWKRXJK'HIHQGDQWDW
86&$OWKRXJKWKHJRYHUQPHQWjVFRPSOLDQFHZLWK                RQH WLPHFODLPHGWRRZQWKHSURSHUW\LQTXHVWLRQKHQRZ
WKH6SHHG\7ULDO$FWGRHVQRWEDUIXWXUH6L[WK$PHQGPHQW                 FODLPVQRLQWHUHVWDQGDVVHUWVWKDWKHZDVQHYHUWKHRZQHURI
VSHHG\WULDOSURYLVLRQFODLPVZHKDYHSUHYLRXVO\KHOGWKDWmLW          WKHSURSHUW\7KHJRYHUQPHQWDUJXHVDWOHDVWWZRDOWHUQDWLYH
ZLOOEHDQXQXVXDOFDVHLQZKLFKWKHWLPHOLPLWVRIWKH6SHHG\           EDVHV IRU ILQGLQJ WKDW 'HIHQGDQW KDG D FRJQL]DEOH OHJDO
7ULDO$FWKDYHEHHQPHWEXWWKH6L[WK$PHQGPHQWULJKWWR                 LQWHUHVWLQWKHSURSHUW\ZKHQKHFRPPLWWHGWKHFULPLQDODFWV
VSHHG\WULDOKDVEHHQYLRODWHGl8QLWHG6WDWHVY'HsHVXV          JLYLQJULVHWRWKHIRUIHLWXUHDFWLRQWKDW'HIHQGDQWRZQHGWKH
)G   WK &LU  TXRWLQJ 8QLWHG 6WDWHV Y         IDUP SURSHUW\ DQG WKDW KH KDG VRPH RWKHU LQWHUHVW LQ WKH
1DQFH)GWK&LUFHUWGHQLHG              SURSHUW\  $OWKRXJK ZH EHOLHYH WKH GLVWULFW FRXUW FRUUHFWO\
86VHHDOVR8QLWHG6WDWHVY6FKOHL)G             GHWHUPLQHGWKDW'HIHQGDQWGLGQRWKDYHOHJDOWLWOHWRWKHIDUP
WK&LU                                               SURSHUW\KHGLGKDYHVRPHLQWHUHVWLQWKHSURSHUW\E\YLUWXH
                                                                         RI WKH (VFURZ $JUHHPHQW RQ $XJXVW    7KXV LQ
   ,Q%DUNHUY:LQJR86WKH6XSUHPH             WKHRU\WKHGLVWULFWFRXUWVKRXOGKDYHRUGHUHG'HIHQGDQWWR
&RXUWLGHQWLILHGIRXUIDFWRUVWKDWGLVWULFWFRXUWVPXVWFRQVLGHU         IRUIHLW WKLV LQWHUHVW  %XW DV ZH ZLOO GLVFXVV WKH HYLGHQFH
LQGHWHUPLQLQJZKHWKHUDGHIHQGDQWKDVEHHQGHQLHGDVSHHG\              DGGXFHG DW WULDO VKRZHG WKDW WKLV LQWHUHVW KDG DOUHDG\ EHHQ
WULDOLQYLRODWLRQRIWKH6L[WK$PHQGPHQWWKHOHQJWKRI            H[WLQJXLVKHG\HDUVSULRUWRWKHWLPHWKHJRYHUQPHQWREWDLQHG
WKH GHOD\  WKH UHDVRQ IRU WKH GHOD\  WKH GHIHQGDQW
V   WKH LQGLFWPHQW VHHNLQJ IRUIHLWXUH  %\ FRUROODU\ WKH
DVVHUWLRQRIKLVULJKWDQGWKHSUHMXGLFHWRWKH'HIHQGDQW          JRYHUQPHQWjV LQWHUHVW ZDV DOVR WHUPLQDWHG  7KHUHIRUH ZH
7ZHQW\\HDUVODWHUWKH&RXUWUHYLVLWHGWKHLVVXHLQ'RJJHWWY           KROGWKDWWKHGLVWULFWFRXUWjVIDLOXUHWRRUGHUIRUIHLWXUHRIWKDW
8QLWHG6WDWHV86DQGUHILQHGWKHLQTXLU\               LQWHUHVWGRHVQRWFRQVWLWXWHUHYHUVLEOHHUURUEHFDXVHWKHUHZDV
WKDWGLVWULFWFRXUWVPXVWSXUVXH7KH&RXUWVWDWHGWKDWLWLV           QRWKLQJIRUWKHGLVWULFWFRXUWWRKDYHRUGHUHGIRUIHLWHG
QHFHVVDU\IRUGLVWULFWFRXUWVWREDODQFHmZKHWKHUGHOD\EHIRUH
WULDOZDVXQFRPPRQO\ORQJZKHWKHUWKHJRYHUQPHQWRUWKH
FULPLQDOGHIHQGDQWLVPRUHWREODPHIRUWKDWGHOD\ZKHWKHU
LQ GXH FRXUVH WKH GHIHQGDQW DVVHUWHG KLV ULJKW WR D VSHHG\
       8QLWHG6WDWHVY2j'HOO            1RV             1RV                8QLWHG6WDWHVY2j'HOO          

   7KXVZHPXVWGHWHUPLQHZKDWLIDQ\LQWHUHVW'HIHQGDQW                    WULDODQGZKHWKHUKHVXIIHUHGSUHMXGLFHDVWKHGHOD\jVUHVXOWl
KDG LQ WKH SURSHUW\ WKDW WKH JRYHUQPHQW QRZ FODLPV  7KH             ,GDWFLWLQJ%DUNHU86DW1RQHRIWKHVH
SDUWLHVDJUHHWKDWmWKHTXHVWLRQRIZKHWKHU'HIHQGDQWKDGDQ                   IDFWRUVDORQHLVVXIILFLHQWWRHVWDEOLVKDYLRODWLRQRIWKH6L[WK
LQWHUHVWLQWKHSURSHUW\PXVWEHGHWHUPLQHGE\UHIHUHQFHWR                    $PHQGPHQW,QVWHDGWKH6XSUHPH&RXUWGHFODUHGWKDWmWKHVH
VWDWHSURSHUW\ODZLQWKLVFDVHWKHVWDWHRI7HQQHVVHH6HH                 DUHUHODWHGIDFWRUVDQGPXVWEHFRQVLGHUHGWRJHWKHUZLWKVXFK
8QLWHG6WDWHVY6PLWK)GQWK&LU                     RWKHUFLUFXPVWDQFHVDVPD\EHUHOHYDQWl%DUNHU86DW
                                                                        :KHQDGHIHQGDQW
VFRQVWLWXWLRQDOULJKWWRDVSHHG\WULDO
                                                                               KDV EHHQ YLRODWHG GLVPLVVDO RI WKH LQGLFWPHQW LV WKH RQO\
  'HIHQGDQWjVUHODWLRQVKLSWRWKHIDUPSURSHUW\VWHPVIURPD                   UHPHG\HYHQZKHQLWDOORZVDGHIHQGDQWZKRPD\EHJXLOW\RI
 :DUUDQW\ 'HHG DQG (VFURZ $JUHHPHQW HQWHUHG LQWR                    DVHULRXVFULPHWRJRIUHH6HHLGDW
ZLWKKLVIDWKHUsDFNVRQ2j'HOOsU,Q2FWREHURIWKDW\HDU
2j'HOO sU H[HFXWHG D :DUUDQW\ 'HHG FRQGLWLRQDOO\                                             /HQJWKRIWKH'HOD\
FRQYH\LQJWKHDFUHIDUPWR'HIHQGDQW7KHFRQVLGHUDWLRQ
IRU WKLVFRQYH\DQFHZDV'HIHQGDQWjVDJUHHPHQWWRSD\WKH                        ,QDOO6L[WK$PHQGPHQWVSHHG\WULDOFDVHVWKHOHQJWKRIWKH
EDODQFH GXH RQ WKH PRUWJDJH RULJLQDOO\ REWDLQHG E\                      GHOD\ LV WKH WULJJHULQJ PHFKDQLVP  $V WKH 'RJJHWW &RXUW
2j'HOO sU  7R PHPRULDOL]H WKLV DJUHHPHQW WKH SDUWLHV                VWDWHGmVLPSO\WRWULJJHUDVSHHG\WULDODQDO\VLVDQDFFXVHG
HQWHUHGLQWRDQ(VFURZ$JUHHPHQWZKLFKUHDGVLQUHOHYDQW                     PXVWDOOHJHWKDWWKHLQWHUYDOEHWZHHQDFFXVDWLRQDQGWULDOKDV
SDUW                                                                          FURVVHGWKHWKUHVKROGGLYLGLQJRUGLQDU\IURPµSUHVXPSWLYHO\
                                                                               SUHMXGLFLDOjGHOD\VLQFHE\GHILQLWLRQKHFDQQRWFRPSODLQ
  8SRQWKHSD\PHQWE\WKHSXUFKDVHURIDOOWKHSD\PHQWV                     WKDWWKHJRYHUQPHQWKDVGHQLHGKLPDµVSHHG\jWULDOLILWKDV
  GXHWRWKH)HGHUDO/DQG%DQNXQGHUWKH'HHGRI7UXVW                         LQ IDFW SURVHFXWHG KLV FDVH ZLWK FXVWRPDU\ SURPSWQHVVl
  DIRUHVDLGDQGXSRQWKHSUHVHQWDWLRQRIHYLGHQFHRIVXFK                      'RJJHWW86DWFLWDWLRQVRPLWWHG,QWKHLQVWDQW
  SD\PHQWDQGUHOHDVHRIWKHOLHQWRWKHHVFURZDJHQWWKH                     FDVHWKHSDUWLHVDJUHHWKDWWKHGHOD\EHIRUHWULDOLVVXIILFLHQW
  HVFURZ DJHQW LV DXWKRUL]HG WR GHOLYHU VDLG GHHG WR WKH              WRWULJJHUVSHHG\WULDOFRQFHUQV
                                                                                                    5HDVRQVIRUWKH'HOD\
     
       %XW FI 8QLWHG 6WDWHV Y 0RUJDQ  )G  WK &LU  XVLQJ
                                                                                  ,IDGHIHQGDQWVKRZVDGHOD\VXIILFLHQWWRWULJJHUVSHHG\
GRPLQLRQ DQG FRQWURO WHVW WR GHWHUPLQH ZKHWKHU D WKLUGSDUW\ SHWLWLRQHU
XQGHU   Q KDG D SURSHUW\ LQWHUHVW LQ EDQNLQJ DFFRXQWV DQG
                                                                               WULDOFRQFHUQVWKHGLVWULFWFRXUWPXVWWKHQDGGUHVVWKHUHODWHG
FHUWLILFDWHV RI GHSRVLW 7KH 0RUJDQ FRXUW ORRNHG WR FRQJUHVVLRQDO LQWHQW      LVVXHRIUHDVRQVIRUWKHGHOD\7KHFRUHWDVNLVGHWHUPLQLQJ
mWR GHQ\ UHOLHI WR WKLUG SDUWLHV DFWLQJ DV QRPLQHHV RI 'HIHQGDQW RU ZKR        ZKLFKSDUW\VKRXOGHUVWKHEDODQFHRIEODPHZRUWKLQHVVIRUWKLV
NQRZLQJO\ HQJDJH LQ VKDP WUDQVDFWLRQVl 7KLV FDVH LV QRW SUHFLVHO\ RQ          GHOD\,QDQDO\]LQJWKLVIDFWRUWKH6XSUHPH&RXUWKDVQRWHG
SRLQW ZLWK WKH FDVH DW EDU 0RUJDQ GHDOW ZLWK WKH $UWLFOH ,,, VWDQGLQJ RI      WKDW mGLIIHUHQW ZHLJKWV VKRXOG EH DVVLJQHG WR GLIIHUHQW
D WKLUG SDUW\ FODLPDQW VXEVHTXHQW WR D IRUIHLWXUH RUGHU WKDW YHVWHG
RZQHUVKLS LQ WKH JRYHUQPHQW 7KH LQVWDQW FDVH FRQVLGHUV WKH SURSHUW\
                                                                               UHDVRQVl IRU GHOD\  %DUNHU  86 DW   7KXV WKH
LQWHUHVWV RI D FULPLQDO GHIHQGDQW SULRU WR DQ RUGHU RI IRUIHLWXUH 0RUHRYHU   6XSUHPH&RXUWKHOGLQ%DUNHU
QR HYLGHQFH RI VXFK D VKDP WUDQVDFWLRQ LV SUHVHQW RU HYHQ DOOHJHG LQ WKH
LQVWDQW FDVH ,Q IDFW WKH WUDQVDFWLRQ LQ TXHVWLRQWKH (VFURZ $JUHHPHQW
ZDV H[HFXWHG QHDUO\ ILIWHHQ \HDUV SULRU WR 'HIHQGDQWjV DUUHVW
                                                                                   
)XUWKHUPRUH RWKHU FRXUWV KDYH FRQVLVWHQWO\ DSSOLHG UHOHYDQW VWDWH ODZ LQ             7KH LPSRUWDQFH RI WKLV IDFWRU FDQQRW EH XQGHUHVWLPDWHG ,QGHHG WKH
GHWHUPLQLQJ ZKHWKHU D WKLUG SDUW\ KDV VXFK D SURSHUW\ LQWHUHVW 6HH HJ     6XSUHPH &RXUW KDV UHFRJQL]HG WKDW m>W@KH IODJ DOO OLWLJDQWV VHHN WR FDSWXUH
8QLWHG 6WDWHV Y +RRSHU  )G   Q WK &LU  H[SUHVVO\      LV WKH VHFRQG IDFWRU WKH UHDVRQ IRU GHOD\l 8QLWHG 6WDWHV Y /RXG +DZN
UHMHFWLQJ WKH WHVW XVHG LQ 0RUJDQ                                             86   
    8QLWHG6WDWHVY2j'HOO           1RV          1RV             8QLWHG6WDWHVY2j'HOO        

     $ GHOLEHUDWH DWWHPSW WR GHOD\ WKH WULDO LQ RUGHU WR          :HDJUHHWKDWWKHODQJXDJHRIDLVPDQGDWRU\&I
     KDPSHU WKH GHIHQVH VKRXOG EH ZHLJKWHG KHDYLO\                8QLWHG6WDWHVY3DUFHORI/DQG%OGJV$SSXUWHQDQFHVDQG
     DJDLQVWWKHJRYHUQPHQW$PRUHQHXWUDOUHDVRQVXFK                ,PSURYHPHQWV.QRZQDV%XHQD9LVWD$YH5XPVRQ1s
     DV QHJOLJHQFH RU RYHUFURZGHG FRXUWV VKRXOG EH                86QRWLQJWKDWWKHFULPLQDOIRUIHLWXUH
     ZHLJKWHG OHVV KHDYLO\ EXW QHYHUWKHOHVV VKRXOG EH             VFKHPHSURWHFWVWKHLQWHUHVWVRIWUDQVIHUHHVEXWRQO\WKURXJK
     FRQVLGHUHGVLQFHWKHXOWLPDWHUHVSRQVLELOLW\IRUVXFK              DSURFHGXUHWKDWSRVWGDWHVIRUIHLWXUH%XWZHDOVRUHFRJQL]H
     FLUFXPVWDQFHVPXVWUHVWZLWKWKHJRYHUQPHQWUDWKHU                 WKDWLWRQO\HQWLWOHVWKHJRYHUQPHQWWRIRUIHLWXUHRIDFRQYLFWHG
     WKDQZLWKWKHGHIHQGDQW)LQDOO\DYDOLGUHDVRQVXFK             GHIHQGDQWjVLQWHUHVWVDQGQRWKLQJPRUH6HH8QLWHG6WDWHVY
     DV D PLVVLQJ ZLWQHVV VKRXOG VHUYH WR MXVWLI\               /DYLQ)GG&LUKROGLQJWKDWmLID
     DSSURSULDWHGHOD\                                                 WKLUGSDUW\jVLQWHUHVWLQWKHIRUIHLWHGSURSHUW\DWWKHWLPHRI
                                                                        WKH FULPLQDO DFWV ZDV VXSHULRU WR WKH FULPLQDO GHIHQGDQWjV
,GIRRWQRWHRPLWWHG7KH&RXUWIXUWKHUQRWHGLQDIRRWQRWH         LQWHUHVWWKHQWKHLQWHUHVWWKDWWKHJRYHUQPHQWDFTXLUHVZKHQ
m:HKDYHLQGLFDWHGRQSUHYLRXVRFFDVLRQVWKDWLWLVLPSURSHU            LWVWHSVLQWRWKHGHIHQGDQWjVVKRHVLVVXERUGLQDWHWRWKDWRIWKH
IRU WKH SURVHFXWLRQ LQWHQWLRQDOO\ WR GHOD\ µWR JDLQ VRPH        WKLUGSDUW\.XKQY9LVWD'LVSRVDO,QF)6XSS
WDFWLFDODGYDQWDJHRYHUGHIHQGDQWVRUWRKDUDVVWKHPjl,G           ('0LFKm7KHJRYHUQPHQWWKURXJKIRUIHLWXUH
DWQFLWLQJ8QLWHG6WDWHVY0DULRQ86             VLPSO\ VWHSV LQWR WKH GHIHQGDQWjV VKRHV  7KXV WKH
   %XW WKH &RXUW KDV GHOLYHUHG HTXDOO\ VWURQJ      JRYHUQPHQWFDQDFTXLUHWKURXJKIRUIHLWXUHQRJUHDWHULQWHUHVW
ODQJXDJH LQGLFDWLQJ WKDW GHIHQGDQWV PLJKW DOVR HQJDJH LQ         WKDQWKHGHIHQGDQWKHOGDWWKHWLPHWKHGHIHQGDQWFRPPLWWHG
VWUDWHJLFGHOD\                                                        WKH FULPLQDO DFWVl FLWDWLRQ RPLWWHG FI 8QLWHG 6WDWHV Y
                                                                        &HUWDLQ 5HDO 3URSHUW\ /RFDWHG DW  /HUR\ /DQH :HVW
  'HOD\LVQRWDQXQFRPPRQGHIHQVHWDFWLF$VWKHWLPH                  %ORRPILHOG 0LFKLJDQ  )G   WK &LU 
  EHWZHHQWKHFRPPLVVLRQRIWKHFULPHDQGWULDOOHQJWKHQV              KROGLQJWKDWZKLOHWKHIHGHUDOIRUIHLWXUHVFKHPHDOORZVWKH
  ZLWQHVVHV PD\ EHFRPH XQDYDLODEOH RU WKHLU PHPRULHV              JRYHUQPHQWWRDVVXPHDGHIHQGDQWjVLQWHUHVWVLQSURSHUW\LW
  PD\ IDGH,IWKHZLWQHVVHVVXSSRUWWKHSURVHFXWLRQLWV              PD\QRWE\YLUWXHRIWKHIRUIHLWXUHRUGHUDOWHUWKHHVVHQWLDO
  FDVHZLOOEHZHDNHQHGVRPHWLPHVVHULRXVO\VR$QGLWLV              FKDUDFWHULVWLFVRIDWHQDQF\E\WKHHQWLUHWLHVHVWDWH,Q/HUR\
  WKHSURVHFXWLRQZKLFKFDUULHVWKHEXUGHQRISURRI7KXV              /DQHZHUHFRJQL]HGWKDWDOORZLQJWKHJRYHUQPHQWLPPHGLDWH
  XQOLNHWKHULJKWWRFRXQVHORUWKHULJKWWREHIUHHIURP              DFFHVVWRDFRQYLFWHGGHIHQGDQWjVVKDUHRIDQHQWLUHWLHVHVWDWH
  FRPSHOOHG VHOILQFULPLQDWLRQ >VLF@ GHSULYDWLRQ RI WKH          mZRXOGYHVWWKH>J@RYHUQPHQWZLWKDJUHDWHULQWHUHVWWKDQWKDW
  ULJKW WR VSHHG\ WULDO GRHV QRW SHU VH SUHMXGLFH WKH          KHOGE\WKHZURQJGRHUZKRVHLQWHUHVWVWKH>J@RYHUQPHQWKDV
  DFFXVHG
VDELOLW\WRGHIHQGKLPVHOI                                  DFTXLUHGl,G7KLVSUHPLVHLVSDUWLFXODUO\WUXHGXHWRWKH
                                                                        LQ SHUVRQDP QDWXUH RI FULPLQDO IRUIHLWXUH SURFHHGLQJV DV
%DUNHU86DW7KXV'HIHQGDQWVGRQRWKDYHFDUWH            FRPSDUHG WR FLYLO IRUIHLWXUH SURFHHGLQJV LQ ZKLFK OLDELOLW\
EODQFKHLQDVVHUWLQJFRQVWLWXWLRQDOVSHHG\WULDOFODLPV                DWWDFKHV WR WKH SURSHUW\ LWVHOI  m7KH FULPLQDO IRUIHLWXUH
                                                                        SURYLVLRQV RI  86&   DXWKRUL]H DQ LQ SHUVRQDP
  ,QDGGLWLRQWRWKHVHLPSURSHUUHDVRQVIRUGHOD\FRXUWVKDYH          DFWLRQDJDLQVWDGHIHQGDQWLQDFULPLQDOFDVHDQGIRUIHLWXUHLQ
DOVRGHVLJQDWHGSUHVXPSWLYHO\MXVWLILDEOHUHDVRQVLQFOXGLQJ            VXFKDFDVHLVLPSRVHGDVDVDQFWLRQDJDLQVWWKHGHIHQGDQW
UHVROXWLRQ RI SUHWULDO PRWLRQV  6HH HJ 8QLWHG 6WDWHV Y   XSRQKLVFRQYLFWLRQ&LYLOIRUIHLWXUHRQWKHRWKHUKDQGLVDQ
6FKOHL  )G   WK &LU  GHOD\ GXH WR      LQUHPSURFHHGLQJZKHUHLQWKHVXEMHFWSURSHUW\LVWUHDWHGDV
UHVROXWLRQRISUHWULDOPRWLRQVGLGQRWWULJJHUYLRODWLRQRI6L[WK       EHLQJLWVHOIJXLOW\RIZURQJGRLQJl6HH/HUR\/DQH)G
$PHQGPHQWULJKWWRDVSHHG\WULDO8QLWHG6WDWHVYsRQHV          DWFLWDWLRQVRPLWWHG
)G   G &LU  KROGLQJ WKDW mOHJLWLPDWH SUHWULDO
    8QLWHG6WDWHVY2j'HOO          1RV       1RV              8QLWHG6WDWHVY2j'HOO        

  FRQFOXVLRQ ZRXOG EH WKH VDPH  2j'HOO sU ZDV WKH       SURFHHGLQJV DUH µQHXWUDO UHDVRQV QRW DWWULEXWDEOH WR WKH
  RZQHURIWKHSURSHUW\DWWKHWLPHRIWKHRIIHQVHDQGWKH          JRYHUQPHQWjl
  JRYHUQPHQWZDVQRWHQWLWOHGWRDIRUIHLWXUH*LYHQWKH
  XQXVXDOVWDWHRISURRILQWKLVFDVHWKHFRXUWFDQILQGQR           ,QDQDWWHPSWWRFDVWWKHIDFWVLQWKHOLJKWPRVWIDYRUDEOHWR
  MXVWUHDVRQWRGHOD\LWVMXGJPHQWWKDWWKHJRYHUQPHQWLV          WKHLUUHVSHFWLYHSRVLWLRQVHDFKSDUW\LQWKHFDVHDWEDUDUJXHV
  QRWHQWLWOHGWRIRUIHLWWKHDFUHIDUPSURSHUW\               DWOHQJWKLWVRZQYHUVLRQRIWKHSURFHGXUDOKLVWRU\'HIHQGDQW
                                                                    DOOHJHV WKDW DIWHU KH HQWHUHG LQWR D SOHD DJUHHPHQW $86$
'LVWULFW&RXUW2UGHUs$DWHPSKDVLVDGGHG            &RRN PDGH DIILUPDWLYH PLVUHSUHVHQWDWLRQV UHJDUGLQJ KLV
                                                                    LQWHQWLRQVWRFKDUJH'HIHQGDQWjVIDWKHUDQGVRQVZLWKFULPHV
   2Q DSSHDO WKH JRYHUQPHQW FODLPV WKDW XQGHU  86&    'HIHQGDQW FRQWHQGV  WKDW WKH $86$ FRQFHDOHG KLV DOOHJHG
DRQFHDGHIHQGDQWLVFRQYLFWHGDQGWKHDSSURSULDWH          WUXH LQWHQW ZKLFK ZDV WR DYRLG SRVVLEOH GRXEOH MHRSDUG\
QH[XVLVGUDZQEHWZHHQKLVFULPLQDOFRQGXFWDQGWKHSURSHUW\        SUREOHPV VWHPPLQJ IURP WKH FLYLO IRUIHLWXUH DFWLRQ RQ WKH
DWLVVXHWKHGLVWULFWFRXUWPXVWDXWRPDWLFDOO\RUGHUIRUIHLWXUH    IDUPSURSHUW\$PRQJRWKHU IDFWRUV'HIHQGDQWQRWHVWKDW
RIDGHIHQGDQWjVLQWHUHVWVLQWKHVXEMHFWSURSHUW\UHJDUGOHVVRI    DIWHUWKH$86$WKUHDWHQHGSURVHFXWLRQIRUPDQ\PRQWKVDQG
WKHQDWXUHRIWKDWLQWHUHVW7KDWVWDWXWHSURYLGHVLQSHUWLQHQW   YROXQWDULO\ GLVPLVVHG WKH LQIRUPDWLRQ WKH JRYHUQPHQW
SDUW                                                               HYHQWXDOO\ EURXJKW QR FKDUJHV DJDLQVW KLV IDWKHU DQG VRQV
                                                                    'HIHQGDQW DOVR SRLQWV WR WKH IDFW WKDW WKH JRYHUQPHQW
  $Q\SHUVRQFRQYLFWHGRIDYLRODWLRQRIWKLVVXEFKDSWHURU         DFNQRZOHGJHG LWV GRXEOH MHRSDUG\ SUREOHP LQ PRYLQJ WR
  VXEFKDSWHU,,RIWKLVFKDSWHUSXQLVKDEOHE\LPSULVRQPHQW          GLVPLVV WKH FLYLO IRUIHLWXUH DFWLRQ WKH GD\ DIWHU WKH SUHVHQW
  IRUPRUHWKDQRQH\HDUVKDOOIRUIHLWWRWKH8QLWHG6WDWHV        LQGLFWPHQWZDVILOHGs$DW'HIHQGDQWIXUWKHUDUJXHV
  LUUHVSHFWLYHRIDQ\SURYLVLRQRI6WDWHODZDQ\RI       WKDW WKH LQWHUORFXWRU\ DSSHDOV WKDW GHOD\HG KLV WULDO IURP
  WKHSHUVRQjVSURSHUW\XVHGRULQWHQGHGWREHXVHGLQDQ\        2FWREHU   WR 0DUFK   ZRXOG KDYH DOO EHHQ
  PDQQHU RU SDUW WR FRPPLW RU WR IDFLOLWDWH WKH           XQQHFHVVDU\LIWKHJRYHUQPHQWKDGSURFHHGHGWRVHQWHQFLQJ
  FRPPLVVLRQRIVXFKYLRODWLRQ                                    SXUVXDQWWRWKHSOHDDJUHHPHQWLQVWHDGRILQYLWLQJ'HIHQGDQW
                                                                    WRZLWKGUDZKLVJXLOW\SOHD'HIHQGDQWDOVRFRQWHQGVWKDWWKH
                                                              WKLUG LQWHUORFXWRU\ DSSHDO ZDV XVHOHVV EHFDXVH LW ZDV FOHDU
                                                                    WKDW WKH 6HQWHQFLQJ *XLGHOLQHV ZRXOG KDYH FDXVHG
  7KHFRXUWLQLPSRVLQJVHQWHQFHRQVXFKSHUVRQVKDOO             'HIHQGDQWjVVHQWHQFHVWREHVHUYHGFRQFXUUHQWO\$VDUHVXOW
  RUGHULQDGGLWLRQWRDQ\RWKHUVHQWHQFHLPSRVHGSXUVXDQW         DGGLWLRQDOFKDUJHVZRXOGKDYHUHVXOWHGLQQRDGGLWLRQDOMDLO
  WRWKLVVXEFKDSWHURUVXEFKDSWHU,,RIWKLVFKDSWHUWKDWWKH     WLPH)LQDOO\'HIHQGDQWSRLQWVWRVWDWHPHQWVPDGHE\WKH
  SHUVRQIRUIHLWWRWKH8QLWHG6WDWHVDOOSURSHUW\GHVFULEHG        PDJLVWUDWH MXGJH DQG WKH GLVWULFW FRXUW LQGLFDWLQJ WKDW WKH
  LQWKLVVXEVHFWLRQ                                               JRYHUQPHQWZDVWREODPHIRUWKHGHOD\V
86&DHPSKDVLVDGGHG$QRWKHUSURYLVLRQRI            7KHODUJHVWSDUWRIWKHGHOD\LQWKLVFDVHZDVRFFDVLRQHG
GHILQHVmSURSHUW\lDVUHDOSURSHUW\LQFOXGLQJWKLQJV       E\ WKH JRYHUQPHQW LQ >WKH  FDVH@ SURORQJLQJ LWV
JURZLQJRQDIIL[HGWRDQGIRXQGLQODQGDQGWDQJLEOH           PRWLRQ WR GLVPLVV WKH LQIRUPDWLRQ LQ WKDW FDVH 7KH
DQGLQWDQJLEOHSHUVRQDOSURSHUW\LQFOXGLQJULJKWVSULYLOHJHV       JRYHUQPHQWKDVQRWSURFHHGHGLQDGLOLJHQWPDQQHULQ
LQWHUHVWV FODLPV DQG VHFXULWLHVl   86&  E       WKLV SURVHFXWLRQ DQG sXGJH sRUGDQ VR QRWHG LQ D
HPSKDVLVDGGHG                                                     0HPRUDQGXPDQG2UGHUILOHGRQ6HSWHPEHU
   8QLWHG6WDWHVY2j'HOO           1RV       1RV            8QLWHG6WDWHVY2j'HOO       

  7KHFRXUWLVDZDUHWKDWWKHJRYHUQPHQWKDVDWWHPSWHGWR                                           %
  PDQLSXODWH WKH FRXUW LQ RUGHU WR VDYH LWV FULPLQDO
  SURVHFXWLRQRIWKHGHIHQGDQWDVZHOODVWKHIRUIHLWXUHRI           :HUHYLHZWKHGLVWULFWFRXUWjVLQWHUSUHWDWLRQRIWKHIHGHUDO
  KLV DVVHWV  :LWK WKH GLVPLVVDO RI WKH GHIHQGDQWjV        IRUIHLWXUHODZVGHQRYR6HH8QLWHG6WDWHVY+LOO)G
  UHVLGHQFH IURP &RXQW ,9 RI WKH LQGLFWPHQW WKH             QWK&LU8QLWHG6WDWHVY/HDU
  JRYHUQPHQW DQG WKH GHIHQGDQW DUH LQ QHDUO\ WKH VDPH       sHW0RGHO$6HULDO1R)GWK&LU
  SRVLWLRQWKH\ZHUHZKHQWKHLQIRUPDWLRQZDVILOHGDQG             %XWWKHGLVWULFWFRXUWjVILQGLQJVRIIDFWDUHUHYLHZHG
  WKHGHIHQGDQWSOHDGJXLOW\,QLWVHIIRUWWRSURWHFWDOOLWV     XQGHU D FOHDUO\ HUURQHRXV VWDQGDUG DQG WKH TXHVWLRQ RI
  RSWLRQVWKHJRYHUQPHQWKDVSURORQJHGWKLVSURVHFXWLRQ            ZKHWKHU WKRVH IDFWV DUH VXIILFLHQW WR FRQVWLWXWH D SURSHU
  EH\RQGZKDWZRXOGEHVHHQDVQHFHVVDU\                           FULPLQDO IRUIHLWXUH LV UHYLHZHG GH QRYR  8QLWHG 6WDWHV Y
                                                                    0DUPDOHMR)GWK&LU
  7KHJRYHUQPHQWKDVSURFHHGHGZLWKILYHVHSDUDWHDFWLRQV
  DJDLQVWWKLVGHIHQGDQWRYHUWKHSDVWILYH\HDUVDQGKDV                                           &
  DOUHDG\REWDLQHGYDULRXVGLVPLVVDOVDOORIZKLFKZHUH
  REWDLQHGIRUWKHSXUSRVHRISUHVHUYLQJWKHJRYHUQPHQWjV              &RXQW)RXURIWKHLQGLFWPHQWVRXJKWIRUIHLWXUHRImDQ\DQG
  FULPLQDOSURVHFXWLRQLQWKLVFDVHGXULQJDWLPHZKHQWKH          DOOLQWHUHVWl'HIHQGDQWKDGLQERWKWKHDFUHIDUPSURSHUW\
  ODZZDVXQFOHDUDVWRZKHWKHUDFLYLOIRUIHLWXUHZRXOG            DQGWKHUHVLGHQFHDWWKH7RQDZDQGD7UDLODGGUHVVSXUVXDQWWR
  SUHFOXGH FULPLQDO SURVHFXWLRQ ZKHQ ERWK DFWLRQV              86&$IWHUKLVFRQYLFWLRQRQWKHILUVWWKUHHFRXQWV
  UHYROYHGDURXQGWKHVDPHFRQGXFW                                 FKDUJHGLQWKHLQGLFWPHQW'HIHQGDQWFRQWHVWHGWKHIRUIHLWXUH
                                                                    DQGDUJXHGWKDWKHGLGQRWDFWXDOO\RZQWKHDFUHIDUP
5HSRUW DQG 5HFRPPHQGDWLRQ RI 0DJLVWUDWH sXGJH s$ DW      SURSHUW\7KHGLVWULFWFRXUWDJUHHGDQGIRXQGWKDWWKH
 FLWLQJ WR GLVWULFW FRXUW 0HPRUDQGXP DQG 2UGHU      DFUHIDUPZDVQRWVXEMHFWWRIRUIHLWXUH
JUDQWLQJ'HIHQGDQWUHOLHIRQ6SHHG\7ULDO$FWFODLP7KH
5HSRUWDQG5HFRPPHQGDWLRQZHQWRQWRVWDWHm7KXVsXGJH             >7@KHJRYHUQPHQWDUJXHVWKDWDOOLWQHHGVWRSURYHLVWKDW
sRUGDQjVREVHUYDWLRQWKDWWKHGHOD\VLQWKLVFDVHDUHQRWWKH         WKHSURSHUW\ZDVXVHGWRIDFLOLWDWHWKHPDULMXDQDJURZLQJ
UHVXOWRIPHUHQHJOLJHQFHRURYHUVLJKWE\WKHJRYHUQPHQWEXW         RSHUDWLRQDQGWKLVKDVEHHQSURYHQE\DSUHSRQGHUDQFH
DSSHDUWRKDYHEHHQUDWKHUGHOLEHUDWHLQDQDWWHPSWWRµSURWHFW       RIWKHHYLGHQFH7KXVWKHJRYHUQPHQWDUJXHVWKDWLWLV
DOOLWVRSWLRQVjLVZHOOIRXQGHGl,Gs$DW               HQWLWOHGWRDQRUGHURIIRUIHLWXUHLQZKDWHYHULQWHUHVWWKH
                                                                      GHIHQGDQWKDGLQWKHSURSHUW\RQ$XJXVW>DQG@
  ,QUHVSRQVHWKHJRYHUQPHQWDVVHUWVWKDWPXFKRIWKHGHOD\          DQ\RWKHUFODLPVRQWKHSURSHUW\FRXOGEHOLWLJDWHGLQD
ZDVGXHWROLWLJDWLQJ'HIHQGDQWjVSUHWULDOPRWLRQV)LUVWWKH       VXEVHTXHQWSURFHHGLQJ8QGHUPRVWFLUFXPVWDQFHVWKLV
JRYHUQPHQW FLWHV WR WKH GR]HQV RI PRWLRQV PRWLRQV WR         DUJXPHQWPLJKWFDUU\WKHGD\EXWLQWKLVFDVHWKHLVVXHRI
UHFRQVLGHUDQGREMHFWLRQVILOHGE\'HIHQGDQWRYHUWKH\HDUV         RZQHUVKLSRIWKHSURSHUW\KDVEHHQH[WHQVLYHO\OLWLJDWHG
7KHGLVWULFWFRXUWQRWHGWKHVHQXPHURXVPRWLRQVLQGHQ\LQJ            EHIRUH WKLV FRXUW  $OO RI WKH UHOHYDQW GRFXPHQWV KDYH
'HIHQGDQWjV6L[WK$PHQGPHQWVSHHG\WULDOFODLP                       EHHQ LQWURGXFHG LQWR HYLGHQFH DQG DOO RI WKH SHUVRQV
                                                                      ZLWKNQRZOHGJHRULQWHUHVWLQWKHSURSHUW\KDYHWHVWLILHG
  >7@KHUH ZHUH VHYHUDO UHDVRQDEOH H[SODQDWLRQV IRU WKH          $VVXPLQJ WKDW WKH FRXUW RUGHUHG WKH IRUIHLWXUH DV
  GHOD\  2QH RI WKH SULPDU\ UHDVRQV IRU WKH GHOD\ LQ       VXJJHVWHGE\WKHJRYHUQPHQW2j'HOOsUZRXOGFHUWDLQO\
  EULQJLQJ WKLV FDVH WR WULDO ZDV WKH QXPEHU RI SUHWULDO     UHTXHVW D KHDULQJ SXUVXDQW WR  86&  Q WR
  PRWLRQV ILOHG E\ WKH GHIHQGDQW LQ WKLV FDVH  :LWKRXW      SURWHFW KLV WKLUG SDUW\ LQWHUHVWV DOO RI WKH HYLGHQFH
  WDNLQJWKHWLPHWRDFWXDOO\FRXQWDOORIWKHGHIHQGDQWjV            SUHVHQWO\EHIRUHWKHFRXUWZRXOGEHUHLQWURGXFHGDQGWKH
    8QLWHG6WDWHVY2j'HOO           1RV          1RV             8QLWHG6WDWHVY2j'HOO      

SXQLVKPHQW EXW D FULPLQDO FKDUJH WR EH SURYHG OLNH DQ\          PRWLRQVLWLVHQRXJKWRQRWHWKDWWKHUHDUHZHOORYHU
RWKHUl)GDW$IWHUZHLJKLQJWKHVHKROGLQJVZH             GRFNHWHQWULHVLQWKLVFDVH,QDGGLWLRQWKHGHIHQGDQWKDV
RSWHGWRIROORZWKH7KLUG&LUFXLWjVKROGLQJLQ6DQGLQL                   ILOHGWZRLQWHUORFXWRU\DSSHDOVWRWKH6L[WK&LUFXLWZLWK
                                                                          FURVVDSSHDOV E\ WKH JRYHUQPHQW  7KHVH WZR IDFWRUV
  +RZHYHU DPELJXRXV VHFWLRQ  PD\ EH LW H[SUHVVO\               DORQHKDYHFDXVHGPXFKRIWKHWRWDOGHOD\LQEULQJLQJWKLV
  SURYLGHVWKDWDFRXUWVKDOORUGHUFULPLQDOIRUIHLWXUHmLQ               FDVHWRWULDO
  DGGLWLRQWRDQ\RWKHUVHQWHQFHlDWWKHWLPHWKDWLWLPSRVHV
  WKHVHQWHQFH$OWKRXJKDFULPLQDOIRUIHLWXUHSURFHHGLQJ                                             
  EHDUV VRPH FKDUDFWHULVWLFV RI D FULPLQDO PDWWHU LWV
  SXUSRVHLVWRGHWHUPLQHWKHSURSHUSXQLVKPHQWIRUWKH                   >0@XOWLSOH PRWLRQV KDYH EHHQ ILOHG E\ GHIHQGDQW
  FKDUJHG RIIHQVH RQFH WKH GHIHQGDQWjV JXLOW RQ WKDW               LQFOXGLQJDPRWLRQIRUDFRQWLQXDQFHRIWKHWULDOGDWHGXH
  FKDUJHGRIIHQVHKDG EHHQSURYHGEH\RQGDUHDVRQDEOH                    WRDVFKHGXOLQJFRQIOLFWRIWKHGHIHQGDQWjVFRXQVHO
  GRXEW                                                                  6HQWHQFLQJZDVVHWLQsDQXDU\DQGDWOHDVWRQFHLI
                                                                          QRWWZLFHWKHGHIHQGDQWjVKHDULQJZDVFRQWLQXHGDWWKH
6PLWK)GDW                                                  GHIHQGDQWjV UHTXHVW  7KHUHDIWHU RI FRXUVH WKH ZKROH
                                                                          GHDO IHOO DSDUW DQG WKH GHIHQGDQW ZLWKGUHZ KLV SOHD RI
   'HIHQGDQWFLWHVWRQR6L[WK&LUFXLWFDVHODZDEURJDWLQJRXU            JXLOW\
KROGLQJLQ6PLWK,QVWHDGKHFLWHV6XSUHPH&RXUWSUHFHGHQW
KROGLQJWKDWWKHQDWXUHRIZKDWFRQVWLWXWHVDQDFTXLWWDOLVQRW         0HPRUDQGXP DQG 2UGHU GLVPLVVLQJ 'HIHQGDQWjV 6L[WK
FRQWUROOHG E\ WKH IRUP RI D MXGJHjV DFWLRQ RU E\ WKH ODEHO   $PHQGPHQW VSHHG\ WULDO FODLP s$ DW   7KH
DWWDFKHGWRWKDWDFWLRQE\WKHGLVWULFWFRXUW6HH8QLWHG6WDWHV       JRYHUQPHQWDOVRSRLQWVWRWKHIDFWWKDWWKHUHIHUHQFHVPDGHLQ
Y6LVVRQ86'HIHQGDQWDOVRFLWHV8QLWHG            WKH UHSRUW DQG UHFRPPHQGDWLRQ DQG TXRWHG E\ 'HIHQGDQW
6WDWHVY0DUWLQ/LQHQ6XSSO\&R86LQ              UHODWHGWRDGD\WLPHSHULRGLQWKHSUHLQGLFWPHQW
DUJXLQJ WKDW WKH MXULVGLFWLRQ RI WKH DSSHOODWH FRXUW LV         FDVHDJDLQVW'HIHQGDQWWKHPDMRULW\RIZKLFKZHSUHYLRXVO\
GHWHUPLQHGE\H[DPLQLQJZKHWKHUWKHGLVWULFWFRXUWDFWXDOO\             IRXQGH[FOXGDEOHIRU6SHHG\7ULDO$FWSXUSRVHV6HH2j'HOO
UHSUHVHQWVDUHVROXWLRQRIVRPHRUDOORIWKHIDFWXDOLVVXHVRI         )GDW,QGHHGWKHPDJLVWUDWHMXGJHQRWHGLQ
WKH RIIHQVH FKDUJHG  :H GR QRW WDNH LVVXH ZLWK WKHVH         UHMHFWLQJ'HIHQGDQWjV6L[WK$PHQGPHQWVSHHG\WULDOFODLP
GHFLVLRQV%XWWKH\GRQRWRSHUDWHWRXQGHUPLQHWKHSULQFLSOH          m7KH XQGHUVLJQHG KDV EHHQ FULWLFDO RI WKH JRYHUQPHQW LQ
WKDW WKH DSSHDO E\ WKH JRYHUQPHQW RI D FULPLQDO IRUIHLWXUH     FRQQHFWLRQZLWKWKHKDQGOLQJRIWKHSULRUFDVHLQYROYLQJWKH
GRHVQRWLQYRNHGRXEOHMHRSDUG\FRQFHUQV$VWKH6XSUHPH               ,QIRUPDWLRQLQWKHLQVWDQWFDVH%XWWKHDFWLRQVFULWLFL]HG
&RXUWKHOGLQ0DUWLQ/LQHQ6XSSO\&RmZKHUHDJRYHUQPHQW              GRQRWDGGXSWRD6L[WK$PHQGPHQWVSHHG\WULDOYLRODWLRQ
DSSHDO SUHVHQWV QR WKUHDW RI VXFFHVVLYH SURVHFXWLRQV WKH        XQGHU WKH FLUFXPVWDQFHVl  5HSRUW DQG 5HFRPPHQGDWLRQ
'RXEOHsHRSDUG\&ODXVHLVQRWRIIHQGHGl86DW              s$DW
&OHDUO\LIWKHJRYHUQPHQWLVVXFFHVVIXOLQLWVDSSHDOLQ
WKH LQVWDQW FDVH 'HIHQGDQW ZLOO QRW EH UHWULHG IRU KH KDV        ,QUHYLHZLQJWKHSURFHGXUDOKLVWRU\ZHFRQFOXGHWKDWWKH
DOUHDG\ EHHQ FRQYLFWHG RI WKH VXEVWDQWLYH RIIHQVH  :H          JRYHUQPHQWLVQRWPRUHWREODPHIRUWKHGHOD\VLQWKLVWULDO
WKHUHIRUH EHOLHYH WKH JRYHUQPHQWjV DSSHDO SUHVHQWV D              :HDFFHSWWKHJRYHUQPHQWjVFRQWHQWLRQWKDWLWUHSRUWHGWKH
MXVWLFLDEOHLVVXH                                                      EUHDFKRIWKHSOHDDJUHHPHQWLQRUGHUWRJLYHWKH'HIHQGDQWDQ
                                                                        RSSRUWXQLW\LIKHVRFKRVHWRZLWKGUDZKLVJXLOW\SOHDZKLFK
                                                                        LWDSSHDUVWKDWKHGLG$OWKRXJKWKHJRYHUQPHQWLQIRUPHGWKH
                                                                        GLVWULFWFRXUWRI'HIHQGDQWjVEUHDFKRIWKHSOHDDJUHHPHQWLW
    8QLWHG6WDWHVY2j'HOO            1RV            1RV                 8QLWHG6WDWHVY2j'HOO           

GLGQRWVHHNDQ\UHOLHIDQGGLGQRWVHHNWRZLWKGUDZIURPWKH              SURFHHGLQJ RU DV VRPHWKLQJ PRUH DNLQ WR D VHQWHQFLQJ
DJUHHPHQW  'HIHQGDQW DOOHJHV WKDW $86$ &RRN VRPHKRZ                SURFHHGLQJ  +LJKOLJKWLQJ WKH IDFW WKDW IRUIHLWXUH UHTXHVWV
LQIOXHQFHG WKH VWDWH DXWKRULWLHVj XQZLOOLQJQHVV WR VWULNH D         PXVWEHVWDWHGLQWKHLQGLFWPHQW'HIHQGDQWDUJXHVWKDWWKH
IDYRUDEOHSOHDEDUJDLQZLWKKLVIDWKHUDQGVRQVLQDQHIIRUWWR            GLVWULFW FRXUWjV GHFLVLRQ QRW WR RUGHU IRUIHLWXUH RI WKH IDUP
XQGHUPLQHKLVRZQSOHDDJUHHPHQW%XWWKHVHDOOHJDWLRQVDUH               SURSHUW\ ZDV WKH IXQFWLRQDO HTXLYDOHQW RI D YHUGLFW RI
YDJXHDQGFRPSOHWHO\XQVXSSRUWHGE\WKHUHFRUG:HEHOLHYH                DFTXLWWDO %XWWKH6XSUHPH&RXUWUHMHFWHGWKLVDUJXPHQWLQ
WKDW'HIHQGDQWjVZLWKGUDZDORIKLVJXLOW\SOHDEHOLHVKLVFODLP            /LEUHWWL Y 8QLWHG 6WDWHV  86   
WKDW KH ZDQWHG WR SURFHHG WR VHQWHQFLQJ  0RUHRYHU LI            m)RUIHLWXUHLVDQHOHPHQWRIWKHVHQWHQFHLPSRVHGIROORZLQJ
'HIHQGDQW WUXO\ ZDQWHG WR SURFHHG WR WULDO KH ZRXOG KDYH         FRQYLFWLRQRUDVKHUHDSOHDRIJXLOW\&RQJUHVVSODLQO\
GRQH VR LQVWHDG RI ILOLQJ PXOWLSOH DSSHDOV DQG UHTXHVWLQJ          LQWHQGHG IRUIHLWXUH RI DVVHWV WR RSHUDWH DV SXQLVKPHQW IRU
QXPHURXVVWD\VRIWULDO                                                   FULPLQDO FRQGXFW LQ YLRODWLRQ RI WKH IHGHUDO GUXJ DQG
                                                                           UDFNHWHHULQJ ODZV QRW DV D VHSDUDWH VXEVWDQWLYH RIIHQVHl
    :H DOVR GLVDJUHH ZLWK 'HIHQGDQWjV FKDUJH WKDW WKH WKLUG        7KH )LUVW &LUFXLW UHDFKHG D VLPLODU FRQFOXVLRQ LQ 8QLWHG
LQWHUORFXWRU\ DSSHDO ZDV mXVHOHVVl  ,Q WKDW DSSHDO WKH           6WDWHV Y &XQQLQJKDP  )G   VW &LU 
JRYHUQPHQWDSSHDOHGIURPWKHGLVWULFWFRXUWjVGLVPLVVDORI                 ZKHUHLQLWUHFRJQL]HGWKDWm>W@KH6XSUHPH&RXUWKDVFOHDUO\
&RXQWV7ZRDQG7KUHHRIWKHLQGLFWPHQWFKDUJLQJ'HIHQGDQW                 HVWDEOLVKHGWKDWIRUIHLWXUHVPDGHSXUVXDQWWRWKHIHGHUDOGUXJ
ZLWK JURZLQJ PDULMXDQD DQG XVLQJ DQ HQFORVXUH WR                    DQGUDFNHWHHULQJVWDWXWHVDUHHOHPHQWVRIWKHVHQWHQFHUDWKHU
PDQXIDFWXUHDQGVWRUHWKHPDULMXDQDUHVSHFWLYHO\s$DW               WKDQDSDUWRIWKHFULPLQDORIIHQVHLWVHOIl
  7KH JRYHUQPHQW DUJXHV WKDW  WKRXJK LW UHDOL]HG WKH
VHQWHQFHVZRXOGUXQFRQFXUUHQWO\LWVRXJKWUHLQVWDWHPHQWRI                  0RUHRYHULQ8QLWHG6WDWHVY6PLWK)GWK
WKHFKDUJHVEHFDXVHLWVSURRIRQ&RXQW7ZRZDVWKHVWURQJHVW               &LUZHUHYLHZHGWKHKROGLQJVRIRXUVLVWHUFLUFXLWVWKDW
LQDVPXFKDV'HIHQGDQWFRXOGQRWGHQ\WKDWKHZDVJURZLQJ                   KDYHFRQVLGHUHGWKHQDWXUHRIFULPLQDOIRUIHLWXUHDXWKRUL]HG
PDULMXDQDLQWKHEDUQ7KHJRYHUQPHQWDOVRDFNQRZOHGJHG                   E\  86&    ,Q 6PLWK ZH ILUVW H[DPLQHG 8QLWHG
WKDWUHLQVWDWHPHQWRIWKHFRXQWVVWUHQJWKHQHGLWVSRVLWLRQZLWK            6WDWHVY6DQGLQL)GG&LULQZKLFKWKH
UHVSHFW WR WKH FULPLQDO IRUIHLWXUH FODLP &RXQW )RXU 8SRQ         7KLUG&LUFXLWKHOGWKDWmIRUIHLWXUHLVQRWDQHOHPHQWRIWKH
LQWHUURJDWLRQ E\ WKH GLVWULFW FRXUW DV WR WKH JRYHUQPHQWjV         RIIHQVHEXWVLPSO\DQDGGLWLRQDOSHQDOW\IRUWKDWSURVFULEHG
PRWLYDWLRQIRUVXFKDQDSSHDOWKH$86$UHVSRQGHGmsXGJH                FRQGXFWl)GDW:HQH[WFRQVLGHUHG8QLWHG6WDWHV
, WKLQN D ORW RI LW JRHV WR WKH IRUIHLWXUH  &RXQWV 7ZR DQG   Y(OHUJVPD)GWK&LULQZKLFKWKH
7KUHHDUHGLVWLQFWVHSDUDWHJURXQGVZKLFKLVLPSRUWDQWWRWKH            (OHYHQWK &LUFXLW UHMHFWHG WKH 7KLUG &LUFXLWjV KROGLQJ LQ
IRUIHLWXUHls$DW:HILQGWKLVWREHDYDOLGDQG          6DQGLQL KROGLQJ LQVWHDG WKDW mFULPLQDO IRUIHLWXUH LV QRW
QRQIULYRORXV EDVLV IRU VHHNLQJ WR UHWDLQ DOO FRXQWV RI WKH
LQGLFWPHQW
                                                                               
  $OWKRXJKZHFDQQRWGLYLQHWKHSDUWLHVjLQWHQWLQILOLQJWKH                          ('       5,0
                                                                                 $00 )  5 &  3 F m1R MXGJPHQW RI IRUIHLWXUH PD\ EH
YDULRXVPRWLRQVZHFDQVD\ZLWKVRPHGHJUHHRIFHUWDLQW\                  HQWHUHG LQ D FULPLQDO SURFHHGLQJ XQOHVV WKH LQGLFWPHQW RU WKH LQIRUPDWLRQ
                                                                           VKDOO DOOHJH WKH H[WHQW RI WKH LQWHUHVW RU SURSHUW\ VXEMHFW WR IRUIHLWXUHl
WKDW WKH\ ZHUH DOO VXEPLWWHG WR VRPH VWUDWHJLF HQG  %XW
GHVSLWHWKHIDFWWKDWQXPHURXVVWUDWHJLHVZHUHHPSOR\HGZH                    
                                                                                 7KRXJK WKHVH FDVHV GHFLGHG WKH SURSHU EXUGHQ RI SURRI IRU FULPLQDO
FDQQRWVD\WKDWWKHWDFWLFRIHLWKHUSDUW\ZDVDFWXDOO\WRGHOD\           IRUIHLWXUH XQGHU   SUHSRQGHUDQFH RI WKH HYLGHQFH WKLV GHWHUPLQDWLRQ
WKH WULDO  0RUHRYHU 'HIHQGDQW ILOHG D PRWLRQ WR GLVPLVV         KLQJHG XSRQ RXU VLVWHU FRXUWVj FKDUDFWHUL]DWLRQV RI WKH IRUIHLWXUH
EDVHGRQDVSHHG\WULDOYLRODWLRQRQWKHVDPHGD\KHPRYHG                 SURFHHGLQJ LQ D PDQQHU FRQVLVWHQW ZLWK WKH FKDUDFWHUL]DWLRQ VHW IRUWK LQ
                                                                           WKLV RSLQLRQ
       8QLWHG6WDWHVY2j'HOO           1RV            1RV               8QLWHG6WDWHVY2j'HOO        

             ,,,&DVH1R&5,0,1$/                              WKH GLVWULFW FRXUW IRU D VSHHG\ WULDO  $V WKH GLVWULFW FRXUW
                    )25)(,785(&/$,0                                         LQGLFDWHGLWFRXOGQRWVSHHGWKHWULDODORQJXQWLOLWUHJDLQHG
                                                                             MXULVGLFWLRQ IURP WKLV &RXUW DIWHU LWV GHFLVLRQ RQ DQ
   7KH JRYHUQPHQW DOVR DSSHDOV IURP WKH GLVWULFW FRXUWjV              LQWHUORFXWRU\DSSHDO)XUWKHUPRUHWKHGLVWULFWFRXUWjVLQLWLDO
IDLOXUH WR RUGHU IRUIHLWXUH RI WKH DFUH IDUP SURSHUW\            ILQGLQJWKDWWKHJRYHUQPHQWFDXVHGGHOD\SRVHVQREDUULHUWR
SXUVXDQWWR86&7KHJRYHUQPHQWFRQWHQGVWKDW                    RXUILQGLQJWKDWWKHJRYHUQPHQWLVQRWPRUHWREODPHIRUWKH
LW QHHG QRW SURYH WKH H[WHQW RI D GHIHQGDQWjV LQWHUHVW LQ          GHOD\IRUZHODWHUGHWHUPLQHGWKDWWKLVSHULRGRIGHOD\GLGQRW
SURSHUW\ SULRU WR REWDLQLQJ D FULPLQDO IRUIHLWXUH RUGHU              FRXQW DJDLQVW WKH VSHHG\ WULDO FORFN  0RUHRYHU DQ\ GHOD\
$OWKRXJK ZH DJUHH ZLWK WKLV SUHPLVH LQ SULQFLSOH WKH                DWWULEXWDEOHWRWKHJRYHUQPHQWLVEDODQFHGE\'HIHQGDQWjV
FLUFXPVWDQFHVRIWKLVFDVHGRQRWFRPSHOXVWRILQGWKDWWKH                 RZQVWUDWHJLFPDFKLQDWLRQV
GLVWULFWFRPPLWWHGUHYHUVLEOHHUURU
                                                                                $V WKH 6XSUHPH &RXUW QRWHG LQ  8QLWHG 6WDWHV Y /RXG
                                   $                                        +DZN86m>D@GHIHQGDQWZKRUHVRUWV
                                                                             WRDQLQWHUORFXWRU\DSSHDOVKRXOGQRWEHDEOHXSRQUHWXUQWR
  $VDWKUHVKROGPDWWHU'HIHQGDQWFKDOOHQJHVWKLV&RXUWjV                   WKHGLVWULFWFRXUWWRUHDSWKHUHZDUGRIGLVPLVVDOIRUIDLOXUHWR
MXULVGLFWLRQ WR KHDU WKH JRYHUQPHQWjV DSSHDO  'HIHQGDQW              UHFHLYHDVSHHG\WULDOl7KH/RXG+DZN&RXUWFRQVLGHUHGWKH
FODLPV WKDW KH ZDV LQLWLDOO\ SODFHG LQ MHRSDUG\ ZKHQ WKH            H[WHQW WR ZKLFK DSSHOODWH WLPH FRQVXPHG E\ WKH UHYLHZ RI
GLVWULFW FRXUW FRQVLGHUHG WKH JRYHUQPHQWjV IRUIHLWXUH FODLP            SUHWULDO PRWLRQV VKRXOG ZHLJK LQ IDYRU RI D GHIHQGDQWjV
DQG WKDW WR SHUPLW DQ DSSHDO ZRXOG DJDLQ SODFH KLP LQ              VSHHG\WULDOFODLP%DODQFLQJVSHHG\WULDOFRQFHUQVZLWKWKH
MHRSDUG\LQYLRODWLRQRIWKH'RXEOHsHRSDUG\&ODXVHRIWKH                 QHHGIRURUGHUO\DSSHOODWHUHYLHZWKH&RXUWIRXQGWKDWWKH
)LIWK $PHQGPHQW 8 6 & $% DPHQG 9  7KH 'RXEOH                   GHOD\ DWWULEXWDEOH WR LQWHUORFXWRU\ DSSHDOV GLG QRW FRXQW
sHRSDUG\&ODXVHKDVWUDGLWLRQDOO\SUHYHQWHGWKHUHWULDORID                 WRZDUGVWKHGHIHQGDQWjVVSHHG\WULDOFODLPV6HHLGDW
FULPLQDO GHIHQGDQW ZKR KDV EHHQ DFTXLWWHG RI WKH FULPH               7KH&RXUWIRXQGSDUWLFXODUO\SHUVXDVLYHWKHIDFWWKDWWKH
FKDUJHG6HH8QLWHG6WDWHVY'L)UDQFHVFR86                    GHIHQGDQWjVDSSHDOVZHUHIULYRORXV:HGRQRWTXHVWLRQWKH
7KLVSURWHFWLRQH[WHQGVWRERWKMXU\WULDOVDQG              YDOLGLW\WR'HIHQGDQWjVDSSHDOVLQWKHLQVWDQWFDVH5DWKHULW
EHQFK WULDOV  6HH 6PDOLV Y 3HQQV\OYDQLD  86              LV WKH QXPHURVLW\ DQG IUHTXHQF\ RI WKRVH DSSHDOV ZKLFK
  %XW WKH 6XSUHPH &RXUW KDV UHVLVWHG DWWHPSWV WR             JXLGHVRXUILQGLQJWKDW'HIHQGDQWjVFXOSDELOLW\ZLWKUHVSHFW
H[WHQG WKH SURWHFWLRQ RI WKH 'RXEOH sHRSDUG\ &ODXVH WR               WRGHOD\LVDWOHDVWHTXDOWRWKDWRIWKHJRYHUQPHQW  7KXV
VHQWHQFLQJ6HH%XOOLQJWRQY0LVVRXUL86                   QHLWKHU SDUW\ LV FRPSOHWHO\ IUHH RI EODPH IRU WKH HQVXLQJ
7KXVZKHWKHU'HIHQGDQWLVH[SRVHGWRDGDQJHURI                   GHOD\V
GRXEOH MHRSDUG\ KLQJHV XSRQ WKH FKDUDFWHUL]DWLRQ RI WKH
FULPLQDOIRUIHLWXUHSURFHHGLQJDVHLWKHUDVXEVWDQWLYHFULPLQDO                         'HIHQGDQWjV$VVHUWLRQRI+LV5LJKW
                                                                                :HQH[WFRQVLGHUZKHWKHU'HIHQGDQWDVVHUWHGKLVULJKWWR
                                                                            D VSHHG\ WULDO  ,Q %DUNHU Y :LQJR WKH 6XSUHPH &RXUW
     'HIHQGDQW GRHV QRW FKDOOHQJH WKH JRYHUQPHQWjV VWDWXWRU\
DXWKRUL]DWLRQ WR DSSHDO D VHQWHQFH XQGHU  86&   ZKLFK             HPSKDVL]HG WKDW mIDLOXUH WR DVVHUW WKH ULJKW ZLOO PDNH LW
SURYLGHV WKDW WKH JRYHUQPHQW PD\ ILOH D QRWLFH RI DSSHDO IRU WKH UHYLHZ RI   GLIILFXOWIRUDGHIHQGDQWWRSURYHWKDWKHZDVGHQLHGDVSHHG\
DQ RWKHUZLVH ILQDO VHQWHQFH LI LW mZDV LPSRVHG LQ YLRODWLRQ RI ODZl DQG
XSRQ mWKH SHUVRQDO DSSURYDO RI WKH $WWRUQH\ *HQHUDO WKH 6ROLFLWRU
                                                                             WULDOl86DW'HIHQGDQWFRQWHQGVWKDWKHmVXUHO\
*HQHUDO RU D GHSXW\ VROLFLWRU JHQHUDO GHVLJQDWHG E\ WKH 6ROLFLWRU
                                                                             DQGFHUWDLQO\lDVVHUWHGKLVULJKWWRDVSHHG\WULDODVVHUWLQJ
*HQHUDOl 7KH JRYHUQPHQW GLG REWDLQ WKH DSSURYDO RI IRUPHU 6ROLFLWRU         WKDWKHPRYHGWKHGLVWULFWFRXUWIRUDVSHHG\WULDODIWHUWKLV
*HQHUDO 6HWK :D[PDQ
    8QLWHG6WDWHVY2j'HOO           1RV          1RV             8QLWHG6WDWHVY2j'HOO        

&RXUW GHOLYHUHG LWV SDQHO RSLQLRQ LQ WKH WKLUG LQWHUORFXWRU\    :HEHOLHYHWKDWWKLVUHTXHVWLV\HWDQRWKHUDWWHPSWWRVKLIWWKH
DSSHDO'HIHQGDQWDOVRFRQWHQGVWKDWKLVDWWHPSWVWRHQIRUFH           EXUGHQWKLVWLPHWRWKHGLVWULFWFRXUWWRHQVXUHWKDWVXIILFLHQW
WKHSOHDDJUHHPHQWVHUYHGWRPDNHLWFOHDUWKDWKHZDQWHGWR            IDFWVDUHRQWKHUHFRUGWRVDWLVI\WKHVDIHW\YDOYHUHTXLUHPHQWV
SURFHHGWRVHQWHQFLQJ'HIHQGDQWSUHVHQWVWKHVHDWWHPSWVDV            :HUHFHQWO\KHOGLQ8QLWHG6WDWHVY+RVNLQV)G
HYLGHQFH WKDW KH LQYRNHG WKH ULJKW WR D VSHHG\ WULDO  7KH   WK &LU  WKDW WKH GLVWULFW FRXUW KDV QR EXUGHQ WR
GLVWULFWFRXUWIRXQGWKLVORJLFXQSHUVXDVLYH                           SURYLGHDQ\VXFKILQGLQJVWRDGHIHQGDQW
  7KH ILUVW DQG RQO\ PRWLRQ GHPDQGLQJ D VSHHG\ WULDO            >'@HIHQGDQWjV FRQWHQWLRQ WKDW WKH GLVWULFW FRXUW PXVW
  SXUVXDQW WR WKH 6L[WK $PHQGPHQW ZDV ILOHG RQ                     PDNHILQGLQJVLQUHJDUGWR86&ILVVLPSO\
  6HSWHPEHU    $V WKH PDQGDWH ZDV QRW LVVXHG             QRWVXSSRUWHGE\WKHSODLQUHDGLQJRIWKHVWDWXWH7KHUHLV
  IURP WKH 6L[WK &LUFXLW XQWLO 1RYHPEHU   WKLV            QRWKLQJWKDWVWDWHVDGLVWULFWFRXUWPXVWPDNHDILQGLQJLQ
  FRXUW GLG QRW KDYH MXULVGLFWLRQ RYHU WKH GHIHQGDQWjV             UHJDUG WR VHFWLRQ I 0RUHRYHU DV >866*@
  PRWLRQ XQWLO WKDW GDWH  6LQFH >WKDW WLPH@ PXOWLSOH            &PDNHVFOHDULWLVWKHEXUGHQRIWKHGHIHQGDQW
  PRWLRQVKDYHEHHQILOHGE\GHIHQGDQWLQFOXGLQJDPRWLRQ                WRSURYLGHSHUWLQHQWLQIRUPDWLRQQRODWHUWKDQWKHWLPHRI
  IRUDFRQWLQXDQFH RI WKHWULDOGDWHGXHWRDVFKHGXOLQJ               WKHVHQWHQFLQJKHDULQJ'HIHQGDQWIDLOHGWRGRVRLQWKH
  FRQIOLFWRIWKHGHIHQGDQWjVFRXQVHO\HWWKHWULDOLVVHWIRU           SUHVHQWFDVH
  0DUFKDQGQRIXUWKHUGHOD\VDUHDQWLFLSDWHG
                                                                        +RVNLQV  )G DW   5DWKHU ZH DJUHH ZLWK WKH
  7KHGHIHQGDQWDUJXHVWKDWKLVHIIRUWVWRKDYHWKHFRXUW               JRYHUQPHQWjV DVVHUWLRQ WKDW 'HIHQGDQWjV GHFLVLRQ QRW WR
  HQIRUFH DQ XQHQIRUFHDEOH SOHD DJUHHPHQW VKRXOG                   SURYLGH PRUH LQIRUPDWLRQ LQ WKH ILUVW LQVWDQFH LQVWHDG RI
  VRPHKRZ EH FRQVLGHUHG DV DQ DVVHUWLRQ RI KLV 6L[WK            PDNLQJDPRUHIXOVRPHGLVFORVXUHZDVDmULVN\JDPEOHl6HH
  $PHQGPHQWULJKWV7RWKLVFRXUWjVPLQGWKLVDUJXPHQW                 8QLWHG 6WDWHV Y 0RQWDQH]  )G   VW &LU
  VWUHWFKHVFUHGXOLW\7KHGHIHQGDQWHQWHUHGKLVSOHDWRWKH             :H DOVR ILQG WKDW UHPDQG WR WKH GLVWULFW FRXUW IRU
  LQIRUPDWLRQLQ1RYHPEHU6HQWHQFLQJZDVVHWLQ                  IXUWKHU FRQVLGHUDWLRQ RI WKH VDIHW\ YDOYH LVVXH ZRXOG EH
  sDQXDU\  DQG DW OHDVW RQFH LI QRW WZLFH WKH           LOORJLFDORQSROLF\JURXQGV$VWKHJRYHUQPHQWDSWO\QRWHG
  GHIHQGDQWjV KHDULQJ ZDV FRQWLQXHG DW WKH GHIHQGDQWjV            m>L@I D 'HIHQGDQW FDQ ZLWKKROG LQIRUPDWLRQ FODLP KH KDV
  UHTXHVW7KHUHDIWHURIFRXUVHWKHZKROHGHDOIHOODSDUW            FDUULHGKLVEXUGHQDQGWKHQUHVWDUWWKHZKROHSURFHVVLIDQ\
  DQGWKHGHIHQGDQWZLWKGUHZKLVSOHDRIJXLOW\7KLVFRXUW            FRXUWDORQJWKHZD\GLVDJUHHVWKHVWDWXWRU\UHTXLUHPHQWWKDW
  ILQGVWKDWWKLVIDFWRUZHLJKVDJDLQVWGHIHQGDQWVLQFH           WKH LQIRUPDWLRQ EH SURYLGHG µQRW ODWHU WKDQ WKH VHQWHQFLQJ
  KHKDVRQO\UHFHQWO\PDGHD6L[WK$PHQGPHQWGHPDQG                    KHDULQJjZRXOGEHUHQGHUHGPHDQLQJOHVVl5HSO\%ULHIRI
  IRUDVSHHG\WULDODQGWKHGHIHQGDQWjVWULDOKDVEHHQVHWDV         8QLWHG6WDWHVDV3ODLQWLII$SSHOODQWDW
  WLPHO\DVKLVFRXQVHOZRXOGDOORZ
                                                                                                         &
0HPRUDQGXP DQG 2UGHU s$ DW   7KH 6XSUHPH
&RXUWFRQVLGHUHGDVLPLODUFODLPLQ/RXG+DZNILQGLQJWKDW               %DVHGRQWKHDERYHHYLGHQFHZHKROGWKDW'HIHQGDQWIDLOHG
WKH6L[WK$PHQGPHQWULJKWWRVSHHG\WULDOZDVQRWSURSHUO\              WRVDWLVI\KLVEXUGHQWRHVWDEOLVKHOLJLELOLW\XQGHUWKHVDIHW\
LQYRNHGLQOLJKWRIWKHFLUFXPVWDQFHV                                  YDOYHSURYLVLRQDQGWKDWWKHGLVWULFWFRXUWjVILQGLQJWKDWKHGLG
                                                                        HVWDEOLVKVXFKHOLJLELOLW\ZDVFOHDUO\HUURQHRXV:HWKHUHIRUH
  $OWKRXJKWKH&RXUWRI$SSHDOVIRXQGWKDWUHVSRQGHQWV                  YDFDWH WKH GLVWULFW FRXUWjV MXGJPHQW DQG UHPDQG IRU UH
  KDYH UHSHDWHGO\ PRYHG IRU GLVPLVVDO RQ VSHHG\ WULDO            VHQWHQFLQJZLWKRXWDSSOLFDWLRQRIWKHVDIHW\YDOYH
  JURXQGV    WKDW ILQGLQJ DORQH GRHV QRW HVWDEOLVK WKDW
    8QLWHG6WDWHVY2j'HOO           1RV           1RV                  8QLWHG6WDWHVY2j'HOO          

DQVZHUl  s$ DW   7KLV VWDWHPHQW LPSOLHV WKDW              UHVSRQGHQWVKDYHDSSURSULDWHO\DVVHUWHGWKHLUULJKWV:H
LQIRUPDWLRQUHJDUGLQJ'HIHQGDQWjVIDWKHUDQGVRQVZRXOGEH                   KHOGLQ%DUNHUWKDWVXFKDVVHUWLRQVIURPGHIHQGDQWVDUH
LUUHOHYDQWEHFDXVHWKH\FRXOGQRORQJHUEHFKDUJHGLQUHODWLRQ               mHQWLWOHG WR VWURQJ HYLGHQWLDU\ ZHLJKWl LQ GHWHUPLQLQJ
WRWKHRIIHQVHV/LNHZLVH'HIHQGDQWDOVRFRQWHQGVWKDWKH                 ZKHWKHUWKHLUULJKWVWRDVSHHG\WULDOKDYHEHHQGHQLHG
EHOLHYHGWKDWDVRI$XJXVWWKHJRYHUQPHQWKDGDOO                  7KHVHDVVHUWLRQVKRZHYHUPXVWEHYLHZHGLQWKHOLJKWRI
UHOHYDQWLQIRUPDWLRQUHJDUGLQJWKHRIIHQVHV%XWDVDVLVWHU               UHVSRQGHQWVjRWKHUFRQGXFW+HUHUHVSRQGHQWVjVSHHG\
FLUFXLW QRWHG LQ D VWULNLQJO\ VLPLODU FDVH WKLV EHOLHI LV          WULDOFODLPVDUHUHPLQLVFHQWRI3HQHORSHjVWDSHVWU\$WWKH
LUUHOHYDQW,Q8QLWHG6WDWHVY0\HUV)GWK&LU              VDPHWLPHUHVSRQGHQWVZHUHPDNLQJDUHFRUGRIFODLPVLQ
DGHIHQGDQW WROGWKH)%,DOOWKDWKHNQHZDERXWKLV                  WKH 'LVWULFW &RXUW IRU VSHHG\ WULDO WKH\ FRQVXPHG VL[
RZQDFWLRQVEXWUHIXVHGWRSURYLGHRWKHULQIRUPDWLRQVXFKDV               PRQWKV E\ ILOLQJ LQGLVSXWDEO\ IULYRORXV SHWLWLRQV IRU
ZKRKLVEX\HUVZHUHRUWKHQDPHVRIRWKHUVFRQQHFWHGWRKLV                  UHKHDULQJDQGIRUFHUWLRUDUL
RSHUDWLRQ  ,W DSSHDUHG WKDW WKH GHIHQGDQW GLG QRW SURYLGH
DGGLWLRQDOLQIRUPDWLRQEHFDXVHKHGLGQRWWKLQNLWZRXOGEH              86DWFLWDWLRQRPLWWHGIRRWQRWHRPLWWHG*LYHQ
KHOSIXOWRWKHJRYHUQPHQW$JDLQVWWKLVIDFWXDOEDFNJURXQG             WKHPXOWLWXGHRIPRWLRQVILOHGE\'HIHQGDQWZHEHOLHYHWKDW
WKH7HQWK&LUFXLWKHOGWKDW                                             KHKDVZRYHQVXFKDVHOIGHVWUXFWLYHWDSHVWU\LQWKHLQVWDQW
                                                                         DSSHDO,QOLJKWRI'HIHQGDQWjVRZQFRQGXFWZHFDQQRWVD\
  VHFWLRQUHTXLUHVGLVFORVXUHmZKHWKHURUQRWLWLVUHOHYDQW           WKDWKHHIIHFWLYHO\DVVHUWHGKLVFRQVWLWXWLRQDOULJKWWRDVSHHG\
  RU XVHIXO WR WKH JRYHUQPHQWjV LQYHVWLJDWLRQl  8QLWHG           WULDO  )RU WKHVH UHDVRQV 'HIHQGDQW KDV QRW FRQYLQFHG WKLV
  6WDWHVY6KUHVWKD)GWK&LUVHH              &RXUWWKDWWKHGLVWULFWFRXUWjVILQGLQJWKDWKHGLGQRWWLPHO\
  DOVR$FRVWD2OLYDV)GDW7KHEXUGHQZDVRQ                  DVVHUWKLVULJKWWRDVSHHG\WULDOZDVFOHDUO\HUURQHRXV
  0U0\HUVWRSURYHWKDWKHPHWWKHILYHFULWHULDFRQWDLQHG
  LQI8QLWHG6WDWHVY9HUQHUV )G                                    3UHMXGLFHWRWKH'HIHQGDQW
  WK&LU+HIDLOHGWRFDUU\WKDWEXUGHQ
                                                                            ,Q %DUNHU WKH 6XSUHPH &RXUW SURYLGHG JXLGDQFH RQ WKH
8QLWHG6WDWHVY0\HUV)GWK&LU              LVVXHRISUHMXGLFHWRDGHIHQGDQW
FHUWGHQLHG866LPLODUO\LQWKHFDVHDW
EDU'HIHQGDQWjVDFWLRQVIDLOHGWRVDWLVI\WKHUHTXLUHPHQWVRI                3UHMXGLFHRIFRXUVHVKRXOGEHDVVHVVHGLQWKHOLJKWRI
VHFWLRQ ILYH RI WKH VDIHW\ YDOYH SURYLVLRQV  6LPLODU WR WKH       WKHLQWHUHVWVRIGHIHQGDQWVZKLFKWKHVSHHG\WULDOULJKW
GHIHQGDQWLQ0\HUVWKHUHFRUGUHIOHFWVWKDWLQWKHLQVWDQWFDVH             ZDVGHVLJQHGWRSURWHFW7KLV&RXUWKDVLGHQWLILHGWKUHH
'HIHQGDQWDOVRUHIXVHGWRDQVZHUTXHVWLRQVGLUHFWO\SRVHGWR                 VXFK LQWHUHVWV L WR SUHYHQW RSSUHVVLYH SUHWULDO
KLP E\ WKH 86 $WWRUQH\ UHJDUGLQJ PDULMXDQD DFWLYLW\ LQ             LQFDUFHUDWLRQLLWRPLQLPL]HDQ[LHW\DQGFRQFHUQRIWKH
SODFHVRWKHUWKDQKLVEDUQ6HQWHQFLQJ+HDULQJs$DW              DFFXVHGDQGLLLWROLPLWWKHSRVVLELOLW\WKDWWKHGHIHQVH
(YHQDWKLVVHQWHQFLQJKHDULQJ'HIHQGDQWUHIXVHGWRDQVZHU                  ZLOOEHLPSDLUHG2IWKHVHWKHPRVWVHULRXVLVWKHODVW
FHUWDLQ TXHVWLRQV UHVSRQGLQJ WKDW KH ZDV QRW UHTXLUHG WR            EHFDXVHWKHLQDELOLW\RIDGHIHQGDQWDGHTXDWHO\WRSUHSDUH
SURYLGHVXFKLQIRUPDWLRQ                                                    KLVFDVHVNHZVWKHIDLUQHVVRIWKHHQWLUHV\VWHP

  'HIHQGDQW DOVR FRQWHQGV WKDW KH UHOLHG RQ WKH GLVWULFW
FRXUWjV LQWHUSUHWDWLRQ RI WKH VWDWXWH DQG WKDW LI ZH GLVDJUHH
ZLWKWKDWLQWHUSUHWDWLRQWKDWWKHFDVHVKRXOGEHUHPDQGHGWR
JLYHKLPDQRWKHURSSRUWXQLW\WRDQVZHUDGGLWLRQDOTXHVWLRQV                   
                                                                                   7KH &RXUWjV UHIHUHQFH WR 3HQHORSHjV WDSHVWU\ LV IURP +   20(5 7+(
                                                                         2   '<66(< %RRN ,, OLQHV  5 /DWWLPRUH WUDQV 
    8QLWHG6WDWHVY2j'HOO           1RV          1RV             8QLWHG6WDWHVY2j'HOO        

%DUNHU  86 DW  IRRWQRWH RPLWWHG  5HFHQWO\ WKH     ZHUHODZIXOO\VROG7KHUHFRUGUHIOHFWVWKDW'HIHQGDQWGLGQRW
7KLUG&LUFXLWQRWHGWKDWWKHQH[WPRVWLPSRUWDQWLQWHUHVWRID          SURYLGH DQ\ LQIRUPDWLRQ UHJDUGLQJ KLV FRFRQVSLUDWRUV
GHIHQGDQWLVWKHQHHGWRSUHYHQWRSSUHVVLYHLQFDUFHUDWLRQ6HH         'HIHQGDQWDOVRFODLPVWKDWKHVKRXOGVRPHKRZEHDFFRUGHG
8QLWHG 6WDWHV Y 'HQW  )G   G &LU        VRPHSURWHFWLRQEHFDXVHKHILOHGDPRWLRQIRUZULWWHQQRWLFH
ILQGLQJWKDWIHZHUVSHHG\WULDOFRQFHUQVDUHLPSOLFDWHGZKHUH          RIDQ\IXUWKHULQIRUPDWLRQRUHYLGHQFHWKHJRYHUQPHQWPD\
DGHIHQGDQWLVQRWGHWDLQHGGXULQJWKHGHOD\,QDFFRUGDQFH           FRQWHQG ZRXOG EH QHFHVVDU\ WR IXOILOO WKH VDIHW\ YDOYH
ZLWKWKHVHGHFLVLRQVWKHGLVWULFWFRXUWIRXQGWKDWWKHNH\LVVXH       SURYLVLRQ  ,Q IDFW 'HIHQGDQW DUJXHV WKDW WKH JRYHUQPHQW
LQGHWHUPLQLQJSUHMXGLFHZDVZKHWKHU'HIHQGDQWjVDELOLW\WR             ZDLYHGUHYLHZRIWKHVDIHW\YDOYHLVVXHE\IDLOLQJWRUHVSRQG
SUHSDUHDGHIHQVHDQGSUHVHQWWHVWLPRQ\DWWULDOZDVLPSDLUHG           WR KLV PRWLRQ  'HIHQGDQW DOVR FRQWHQGV WKDW KH VKRXOG EH
E\WKHOHQJWKRIWKHGHOD\0HPRUDQGXPDQG2UGHUs$DW             DIIRUGHGVRPHSURWHFWLRQEHFDXVHKHDVNHGWKHGLVWULFWFRXUW
7KHGLVWULFWFRXUWIRXQGWKDW'HIHQGDQWPDGHDEVROXWHO\          WRDGYLVHKLPRQZKHWKHUKDGPDGHDVXIILFLHQWVKRZLQJWR
QRVKRZLQJRIVXFKLPSDLUPHQW6HHLG                                 VDWLVI\ WKH VDIHW\ YDOYH UHTXLUHPHQWV )LQDOO\  'HIHQGDQW
                                                                        FODLPVWKDWKHDQVZHUHGDOOWKHTXHVWLRQVSRVHGWRKLPE\WKH
  2QDSSHDO'HIHQGDQWSRLQWVWRWKHUHFRPPHQGDWLRQVRIWKH             JRYHUQPHQW DQG WKHUHE\ IXOILOOHG WKH ILIWK VDIHW\ YDOYH
PDJLVWUDWH MXGJH DQG WKH RUGHU RI WKH GLVWULFW FRXUW LQ KLV   FULWHULRQ:HGLVDJUHHZLWKDOORIWKHVHFRQWHQWLRQV
6SHHG\ 7ULDO $FW FODLP WR VKRZ WKDW KH ZDV SUHMXGLFHG
8VLQJWKHVHILQGLQJVDVDIRXQGDWLRQIRUDQLQLWLDOVSHHG\WULDO           8QGHU WKH VDIHW\ YDOYH SURYLVLRQ D GHIHQGDQW KDV WKH
SUREOHP 'HIHQGDQW LQYRNHV WKH 'RJJHWW GHFLVLRQ IRU WKH          EXUGHQ WR SURYH WKDW WKH FULWHULD KDYH EHHQ VDWLVILHG  7KH
SURSRVLWLRQ WKDW m>W@KH SUHVXPSWLRQ WKDW SUHWULDO GHOD\ KDV      JRYHUQPHQWKDVQRREOLJDWLRQWRVROLFLWLQIRUPDWLRQWKDWFRXOG
SUHMXGLFHGWKHDFFXVHGLQWHQVLILHVRYHUWLPHl86DW         KHOSDGHIHQGDQWPHHWWKHUHTXLUHPHQWVIRUWKHVDIHW\YDOYH
'HIHQGDQWDVVHUWVWKDWWKHJRYHUQPHQWSURGXFHGQRHYLGHQFH              7KHUHIRUH PHUHO\ DQVZHULQJ DOO TXHVWLRQV SRVHG E\ WKH
WRUHEXWWKLVSUHVXPSWLRQ%XWWKLVDUJXPHQWIDLOVIRULWLV          JRYHUQPHQW PD\ QRW EH VXIILFLHQW  WR TXDOLI\ IRU WKH ILIWK
EDVHG RQ WKH SUHPLVH WKDW WKH GHOD\ LV DWWULEXWDEOH WR WKH    FULWHULRQRIWKHVDIHW\YDOYH6HH8QLWHG6WDWHVY$GX
JRYHUQPHQW,QFRQVLGHULQJ'HIHQGDQWjV6SHHG\7ULDO$FW                )G   WK &LU  m7KHVH SURYLVLRQV FOHDUO\
FODLPWKHGLVWULFWFRXUWGLVPLVVHG&RXQWV7ZRDQG7KUHHEXW           UHTXLUH DQ DIILUPDWLYH DFW E\ WKH GHIHQGDQW WUXWKIXOO\
ZHUHYHUVHGILQGLQJWKDWWKH$FWGLGQRWDSSO\WRWKHWLPH             GLVFORVLQJDOOWKHLQIRUPDWLRQKHSRVVHVVHVWKDWFRQFHUQVKLV
SHULRG LQ TXHVWLRQ  $V QRWHG DERYH WKRXJK GHIHDW RQ D       RIIHQVHRUUHODWHGRIIHQVHVl8QLWHG6WDWHVY:UHQQ)G
6SHHG\ 7ULDO $FW FODLP GRHV QRW EDU D VLPLODU 6L[WK            VW&LULQIRUPDWLRQREWDLQHGIURPUHFRUGLQJVRI
$PHQGPHQWFODLPLWZLOOEHSHUVXDVLYHLQFRQVLGHULQJWKH               GHIHQGDQW
V FRQYHUVDWLRQV ZLWK DQ XQGHUFRYHU DJHQW QRW
PHULWV RI WKH FRQVWLWXWLRQDO FODLP  &I 8QLWHG 6WDWHV Y      mSURYLGHGlE\GHIHQGDQWZLWKLQWKHPHDQLQJRI&
'HsHVXV)GQWK&LUGHFOLQLQJWR            8QLWHG 6WDWHV Y ,YHVWHU  )G   WK &LU 
FRQVLGHU D 6L[WK $PHQGPHQW VSHHG\ WULDO FODLP DIWHU              GHIHQGDQWV PXVW DFW DIILUPDWLYHO\ mWR HQVXUH WKDW WKH
UHVROYLQJD6SHHG\7ULDO$FWFODLPDJDLQVWGHIHQGDQW                  *RYHUQPHQWLVWUXWKIXOO\SURYLGHGZLWKDOOLQIRUPDWLRQDQG
                                                                        HYLGHQFH WKH GHIHQGDQWV KDYH FRQFHUQLQJ WKH UHOHYDQW
  ,QKLVUHSO\EULHI'HIHQGDQWFODLPVWKDWWKHGLVWULFWFRXUW          FULPHVl
LPSURSHUO\IRFXVHGRQWKHWKLUGFRQFHUQDUWLFXODWHGLQ%DUNHU
DQG IDLOHG WR IXOO\ FRQVLGHU WKDW WKH 6L[WK $PHQGPHQWjV           ,QILQGLQJWKDW'HIHQGDQWTXDOLILHGIRUWKHVDIHW\YDOYHWKH
VSHHG\WULDOSURYLVLRQDOVRSURWHFWVFULPLQDOGHIHQGDQWVIURP           GLVWULFWFRXUWLQGLFDWHGWKDWmWKHVWDWXWHRIOLPLWDWLRQVKDVUXQ
D OHQJWK\ SHULRG RI mDQ[LHW\ DQG FRQFHUQl DQG WKDW             RQKLVVRQVZKHWKHUWKH\SDUWLFLSDWHGRUQRW+HVD\VWKH\
SDUWLFXODUL]HG SURRI RI SUHMXGLFH LV QRW HVVHQWLDO WR HYHU\     GLGQjW8QOHVV\RXFDQSURYHRWKHUZLVH\RXjUHVWXFNZLWKKLV
    8QLWHG6WDWHVY2j'HOO          1RV          1RV                   8QLWHG6WDWHVY2j'HOO         

  GHWHUPLQDWLRQ E\ WKH FRXUW WKDW WKH GHIHQGDQW KDV             VSHHG\ WULDO FODLP  %XW QRZKHUH LQ HLWKHU RI 'HIHQGDQWjV
  FRPSOLHGZLWKWKLVUHTXLUHPHQW                                      EULHIVGRHVKHGHWDLODQ\mDQ[LHW\DQGFRQFHUQlIURPZKLFKKH
                                                                       PD\ KDYH VXIIHUHG  %XW HYHQ DVVXPLQJ WKDW 'HIHQGDQW
86&IHPSKDVLVDGGHG6KRUWO\DIWHUDGRSWLRQ          VXIIHUHGVRPHDQ[LHW\VXFKDFODLPZRXOGEHXQGHUPLQHGE\
RIWKLVSURYLVLRQWKH8QLWHG6WDWHV6HQWHQFLQJ&RPPLVVLRQ             WKH IDFW WKDW KH JUHDWO\ FRQWULEXWHG WR KLV RZQ DQ[LHW\ E\
SURPXOJDWHGDQHZJXLGHOLQH866*&ZKLFKDGRSWHG               YLUWXHRIKLVLQFHVVDQWDSSHDOVDQGPRWLRQV
WKHVDIHW\YDOYHODQJXDJHYHUEDWLP
                                                                                                          &
  $SSOLFDWLRQRIWKHVDIHW\YDOYHSURYLVLRQQRWRQO\UHTXLUHV
DGHIHQGDQWWRDGPLWWKHFRQGXFWFKDUJHGEXWLWDOVRLPSRVHV            :HFRQFOXGHWKDWDEDODQFLQJRIWKH IRXU%DUNHUIDFWRUV
DQDIILUPDWLYHREOLJDWLRQRQWKHGHIHQGDQWWRmYROXQWHHUDQ\           ZHLJKV DJDLQVW GLVPLVVDO RI WKH LQGLFWPHQW $OWKRXJK WKH
LQIRUPDWLRQDVLGHIURPWKHFRQGXFWFRPSULVLQJWKHHOHPHQWV             OHQJWK\GHOD\LQWKLVFDVHLVSUHVXPSWLYHO\SUHMXGLFLDORWKHU
RIWKHRIIHQVHl8QLWHG6WDWHVY$UULQJWRQ)G         IDFWRUVLQFOXGLQJWKHH[WHQWWRZKLFK'HIHQGDQWDVVHUWHGKLV
WK&LU8QOLNHRWKHUUHGXFWLRQSURYLVLRQVVXFKDV            VSHHG\WULDOULJKWVWKHODFNRISUHMXGLFHWR'HIHQGDQWDQGWKH
866*(DFFHSWDQFHRIUHVSRQVLELOLW\WKHSURYLVLRQV            UHDVRQV IRU GHOD\ERWK DV WR WKH JRYHUQPHQWjV DQG
RI866*&DQG86&IUHTXLUHDGHIHQGDQW
WRmUHYHDODEURDGHUVFRSHRILQIRUPDWLRQDERXWWKHUHOHYDQW
FULPLQDOFRQGXFWWRWKHDXWKRULWLHVl8QLWHG6WDWHVY6DELU             
                                                                            7KH   'RJJHWW &RXUW VWDWHG
 )G   G &LU   7KHVH VWULQJHQW
UHTXLUHPHQWV UHIOHFW WKH IDFW WKDW WKH VDIHW\ YDOYH mZDV           :H KDYH REVHUYHG LQ SULRU FDVHV WKDW XQUHDVRQDEOH GHOD\
LQWHQGHG WR EHQHILW RQO\ WKRVH GHIHQGDQWV ZKR WUXO\                 EHWZHHQ IRUPDO DFFXVDWLRQ DQG WULDO WKUHDWHQV WR SURGXFH PRUH

FRRSHUDWHl8QLWHG6WDWHVY0DUWLQ)G                  WKDQ RQH VRUW RI KDUP LQFOXGLQJ mRSSUHVVLYH SUHWULDO
                                                                           LQFDUFHUDWLRQl mDQ[LHW\ DQG FRQFHUQ RI WKH DFFXVHGl DQG mWKH
WK &LU  FHUW GHQLHG  6 &W               SRVVLELOLW\ WKDW WKH >DFFXVHGjV@ GHIHQVH ZLOO EH LPSDLUHGl E\
$SSHOODWHFRXUWVKDYHKHOGWKDWDGHIHQGDQWVHHNLQJWRDYRLG               GLPPLQJ PHPRULHV DQG ORVV RI H[FXOSDWRU\ HYLGHQFH
DPDQGDWRU\PLQLPXPVHQWHQFHE\UHVRUWWRWKHVDIHW\YDOYH
KDVWKHEXUGHQRISURYLQJWKDWKHPHHWVDOORIWKHFULWHULDRI                                            

WKHVDIHW\YDOYHSURYLVLRQV6HH8QLWHG6WDWHVY&RQGH              FRQVLGHUDWLRQ RI SUHMXGLFH LV QRW OLPLWHG WR WKH VSHFLILFDOO\
)GG&LU8QLWHG6WDWHVY+RVNLQV                GHPRQVWUDEOH DQG    DIILUPDWLYH SURRI RI SDUWLFXODUL]HG
)GWK&LU                                             SUHMXGLFH LV QRW HVVHQWLDO WR HYHU\ VSHHG\ WULDO FODLP   %DUNHU
                                                                           H[SOLFLWO\ UHFRJQL]HG WKDW LPSDLUPHQW RI RQHjV GHIHQVH LV WKH
  7KHJRYHUQPHQWFRQWHQGVWKDW'HIHQGDQWGLGQRWH[KLELW                   PRVW GLIILFXOW IRUP RI VSHHG\ WULDO SUHMXGLFH WR SURYH EHFDXVH
VXFKFRRSHUDWLRQLQWKHFDVHDWEDUDQGWKHUHIRUHIDLOHGWR              WLPHjV HURVLRQ RI H[FXOSDWRU\ HYLGHQFH DQG WHVWLPRQ\ mFDQ UDUHO\

VDWLVI\WKHILIWKFULWHULRQIRUDSSOLFDWLRQRIWKHVDIHW\YDOYH          EH VKRZQl $QG WKRXJK WLPH FDQ WLOW WKH FDVH DJDLQVW HLWKHU VLGH
                                                                              RQH FDQQRW JHQHUDOO\ EH VXUH ZKLFK RI WKHP LW KDV SUHMXGLFHG
'HIHQGDQW DYHUV WKDW KH GLG RIIHU WR FRRSHUDWH LQ WKH             PRUH VHYHUHO\ 7KXV ZH JHQHUDOO\ KDYH WR UHFRJQL]H WKDW
LQYHVWLJDWLRQDQGSURVHFXWLRQRIRWKHUVEXWWKHJRYHUQPHQW                H[FHVVLYH GHOD\ SUHVXPSWLYHO\ FRPSURPLVHV WKH UHOLDELOLW\ RI D
UHIXVHG WR DFFHSW KLV FRRSHUDWLRQ  %XW ZH EHOLHYH WKDW KH       WULDO LQ ZD\V WKDW QHLWKHU SDUW\ FDQ SURYH RU IRU WKDW PDWWHU
GHPRQVWUDWHGDODFNRIFRRSHUDWLRQE\IDLOLQJWRGLVFXVVLQ                LGHQWLI\ :KLOH VXFK SUHVXPSWLYH SUHMXGLFH FDQQRW DORQH FDUU\

GHWDLO WKH H[WHQW RI KLV PDULMXDQD VPXJJOLQJ DQG JURZLQJ           D 6L[WK $PHQGPHQW FODLP ZLWKRXW UHJDUG WR WKH RWKHU       %DUNHU
                                                                           FULWHULD    LW LV SDUW RI WKH PL[ RI UHOHYDQW IDFWV DQG LWV
RSHUDWLRQ7KHLQIRUPDWLRQ'HIHQGDQWSURYLGHGUHODWHGWRD                LPSRUWDQFH LQFUHDVHV ZLWK WKH OHQJWK RI GHOD\
VXSSOLHURIJURZLQJOLJKWVIHUWLOL]HUDQGRWKHULWHPVZKLFK
                                                                       'RJJHWW  86 DW  FLWDWLRQV RPLWWHG IRRWQRWH RPLWWHG
    8QLWHG6WDWHVY2j'HOO         1RV         1RV             8QLWHG6WDWHVY2j'HOO       

'HIHQGDQWjVLQWHUORFXWRU\DSSHDOVVXSSRUWWKHGLVWULFWFRXUWjV      ZKRFRXOGQRWSURYLGHVXFKGHWDLOHGLQIRUPDWLRQZHUHXVXDOO\
ILQGLQJ WKDW 'HIHQGDQWjV ULJKW WR D VSHHG\ WULDO ZDV QRW    LQHOLJLEOHIRUWKHUHGXFWLRQ,QDQHIIRUWWRPRUHHTXLWDEO\
YLRODWHG7KXVZHDIILUPWKHGLVWULFWFRXUWjVKROGLQJGHQ\LQJ      PHWH RXW MXVWLFH WR FRRSHUDWLQJ LQGLYLGXDOV SOD\LQJ PLQRU
'HIHQGDQWUHOLHIXQGHUWKH6L[WK$PHQGPHQWjVVSHHG\WULDO            UROHV LQ VXFK FRQVSLUDFLHV &RQJUHVV SDVVHG  86&
SURYLVLRQ                                                           IWKHmVDIHW\YDOYHlSURYLVLRQDVSDUWRIWKH9LROHQW
                                                                     &ULPH&RQWURODQG/DZ(QIRUFHPHQW$FWRI3XE/
  ,,&DVH1R'()(1'$17j66(17(1&(                       1R7KDWSURYLVLRQHQWLWOHGm/LPLWDWLRQRQ
                                                                     DSSOLFDELOLW\ RI VWDWXWRU\ PLQLPXPV LQ FHUWDLQ FDVHVl
   ,QLWVILUVWDSSHDOWKHJRYHUQPHQWFRQWHQGVWKDWWKHGLVWULFW    SURYLGHVLQSHUWLQHQWSDUW
FRXUWHUUHGLQILQGLQJWKDW'HIHQGDQWHVWDEOLVKHGHOLJLELOLW\
IRUWKHmVDIHW\YDOYHlSURYLVLRQVRI86&IDQG          1RWZLWKVWDQGLQJDQ\RWKHUSURYLVLRQRIODZLQWKHFDVH
LQWKHDOWHUQDWLYHWKDWHYHQXQGHUWKHVDIHW\YDOYHSURYLVLRQV       RI DQ RIIHQVH    WKH FRXUW VKDOO LPSRVH D VHQWHQFH
KLVVHQWHQFHRIHLJKWHHQPRQWKVLPSULVRQPHQWIHOOEHORZWKH            SXUVXDQWWRJXLGHOLQHVSURPXOJDWHGE\WKH8QLWHG6WDWHV
VWDWXWRULO\SUHVFULEHGVHQWHQFH%HFDXVH'HIHQGDQWIDLOHGWR          6HQWHQFLQJ &RPPLVVLRQ XQGHU VHFWLRQ  RI WLWOH 
GHPRQVWUDWHVXIILFLHQWFRRSHUDWLRQZHILQGWKDWDSSOLFDWLRQ           ZLWKRXWUHJDUGWRDQ\VWDWXWRU\PLQLPXPVHQWHQFHLIWKH
RIWKHVDIHW\YDOYHZDVLPSURSHU7KXVZHQHHGQRWIXUWKHU           FRXUWILQGVDWVHQWHQFLQJDIWHUWKH*RYHUQPHQWKDVEHHQ
DGGUHVVWKHOHJDOLW\RI'HIHQGDQWjVHLJKWHHQPRQWKVHQWHQFH           DIIRUGHG WKH RSSRUWXQLW\ WR PDNH D UHFRPPHQGDWLRQ
                                                                       WKDW
                               $                                       WKH GHIHQGDQW GRHV QRW KDYH PRUH WKDQ  FULPLQDO
                                                                       KLVWRU\ SRLQW DV GHWHUPLQHG XQGHU WKH VHQWHQFLQJ
   :KHUHDVWKLV&RXUWUHYLHZVDGLVWULFWFRXUWjVLQWHUSUHWDWLRQ        JXLGHOLQHV
RI D VWDWXWH RU JXLGHOLQH SURYLVLRQ GH QRYR ZH UHYLHZ D     WKHGHIHQGDQWGLGQRWXVHYLROHQFHRUFUHGLEOHWKUHDWV
GLVWULFWFRXUWjVIDFWXDOGHWHUPLQDWLRQRIZKHWKHUDVWDWXWHRU         RI YLROHQFH RU SRVVHVV D ILUHDUP RU RWKHU GDQJHURXV
JXLGHOLQHDSSOLHVLQDSDUWLFXODUFDVHXQGHUDFOHDUO\HUURQHRXV       ZHDSRQ RU LQGXFH DQRWKHU SDUWLFLSDQW WR GR VR LQ
VWDQGDUG6HH8QLWHG6WDWHVY$GX)GWK&LU        FRQQHFWLRQZLWKWKHRIIHQVH
8QLWHG6WDWHVY0DGXND)GWK&LU            WKHRIIHQVHGLGQRWUHVXOWLQGHDWKRUVHULRXVERGLO\
DSSO\LQJDGHQRYRVWDQGDUGRIUHYLHZWRWKHGLVWULFW           LQMXU\WRDQ\SHUVRQ
FRXUWjV LQWHUSUHWDWLRQ RI 8QLWHG 6WDWHV 6HQWHQFLQJ                WKHGHIHQGDQWZDVQRWDQRUJDQL]HUOHDGHUPDQDJHU
&RPPLVVLRQ*XLGHOLQHV0DQXDO&1RY                    RU VXSHUYLVRU RI RWKHUV LQ WKH RIIHQVH DV GHWHUPLQHG
                                                                       XQGHUWKHVHQWHQFLQJJXLGHOLQHVDQGZDVQRWHQJDJHGLQ
                               %                                      D FRQWLQXLQJ FULPLQDO HQWHUSULVH DV GHILQHG LQ VHFWLRQ
  7KH&RQWUROOHG6XEVWDQFHV$FW86&HWVHT             RIWKH&RQWUROOHG6XEVWDQFHV$FWDQG
VHWVPDQGDWRU\PLQLPXPVHQWHQFHVIRUPDMRUGUXJWUDIILFNLQJ            QRWODWHUWKDQWKHWLPHRIWKHVHQWHQFLQJKHDULQJWKH
RIIHQVHV2ULJLQDOO\WKHRQO\ZD\DGHIHQGDQWFRXOGUHGXFH           GHIHQGDQWKDVWUXWKIXOO\SURYLGHGWRWKH*RYHUQPHQWDOO
KLV VHQWHQFH ZDV WR SURYLGH mVXEVWDQWLDO DVVLVWDQFH LQ WKH     LQIRUPDWLRQDQGHYLGHQFHWKHGHIHQGDQWKDVFRQFHUQLQJ
LQYHVWLJDWLRQl   86&  H  ,URQLFDOO\ WKLV        WKHRIIHQVHRURIIHQVHVWKDWZHUHSDUWRIWKHVDPHFRXUVH
VHQWHQFLQJUHGXFWLRQSURYLVLRQWHQGHGWREHQHILWWKRVHSOD\LQJ         RIFRQGXFWRURIDFRPPRQVFKHPHRUSODQEXWWKHIDFW
PDMRU UROHV LQ GUXJ WUDIILFNLQJ FRQVSLUDFLHV EHFDXVH WKHVH      WKDW WKH GHIHQGDQW KDV QR UHOHYDQW RU XVHIXO RWKHU
LQGLYLGXDOV KDG WKH UHTXLVLWH NQRZOHGJH WR SURYLGH VXFK         LQIRUPDWLRQWRSURYLGHRUWKDWWKH*RYHUQPHQWLVDOUHDG\
VXEVWDQWLDO DVVLVWDQFH  0HDQZKLOH WKRVH ZLWK PLQRU UROHV      DZDUH RI WKH LQIRUPDWLRQ VKDOO QRW SUHFOXGH D
