         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


 /$85$ %$,5'HWDO              ;
           3ODLQWLIIV$SSHOODQWV 
                                    
                                      1R
             Y                     
                                     !
                                    
 *$/( $ 125721LQKHU             
 RIILFLDOFDSDFLW\DV6HFUHWDU\     
 RIWKH,QWHULRUDQG81,7('       
 67$7(6 '(3$570(17 2) 7+(           
 ,17(5,25                          
                                    
          'HIHQGDQWV$SSHOOHHV 
                                   1
        $SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW
      IRUWKH:HVWHUQ'LVWULFWRI0LFKLJDQDW/DQVLQJ
   1Rn'DYLG:0F.HDJXH'LVWULFWsXGJH
                    $UJXHG$XJXVW
           'HFLGHGDQG)LOHG6HSWHPEHU




     
       3XUVXDQW WR )HG 5 $SS 3 F *DOH $ 1RUWRQ LV
DXWRPDWLFDOO\ VXEVWLWXWHG IRU %UXFH %DEELWW IRUPHU 6HFUHWDU\ RI WKH
,QWHULRU DV GHIHQGDQW LQ WKLV DFWLRQ


                                 
     %DLUGHWDOY1RUWRQHWDO                    1R

%HIRUH0225(DQG&/$<&LUFXLWsXGJHV5,&(&KLHI
                 'LVWULFWsXGJH 
                       BBBBBBBBBBBBBBBBB
                             &2816(/
$5*8('  .HYLQ s 0RRG\ 0,//(5 &$1),(/'
3$''2&.	6721(/DQVLQJ0LFKLJDQIRU$SSHOODQWV
sRDQ ( 0H\HU $66,67$17 81,7(' 67$7(6
$77251(< *UDQG 5DSLGV 0LFKLJDQ IRU $SSHOOHHV
21 %5,()  .HYLQ s 0RRG\ /RXLV % 5HLQVZDVVHU
0,//(5 &$1),(/' 3$''2&. 	 6721( /DQVLQJ
0LFKLJDQ IRU $SSHOODQWV  sRDQ ( 0H\HU $66,67$17
81,7('67$7(6$77251(<*UDQG5DSLGV0LFKLJDQ
IRU$SSHOOHHV
  0225(sGHOLYHUHGWKHRSLQLRQRIWKHFRXUWLQZKLFK
&/$< s MRLQHG  5,&( ' s SS  GHOLYHUHG D
VHSDUDWHRSLQLRQFRQFXUULQJLQWKHMXGJPHQW
                       BBBBBBBBBBBBBBBBB
                           23,1,21
                       BBBBBBBBBBBBBBBBB
   .$5(11(/6210225(&LUFXLWsXGJH0LFKLJDQVWDWH
OHJLVODWRUV /DXUD %DLUG DQG *DU\ 3HWHUV FKDOOHQJH IRUPHU
,QWHULRU 6HFUHWDU\ %UXFH %DEELWWjV DSSURYDO RI JDPLQJ
FRPSDFWV EHWZHHQ WKH 6WDWH RI 0LFKLJDQ DQG IRXU ,QGLDQ
WULEHV  %DLUG D PHPEHU RI WKH 0LFKLJDQ +RXVH RI
5HSUHVHQWDWLYHVDQG3HWHUVD0LFKLJDQVWDWHVHQDWRUEURXJKW
VXLW VHHNLQJ D GHFODUDWLRQ WKDW WKH JDPLQJ FRPSDFWV DUH
LQYDOLG DQG DQ RUGHU GLUHFWLQJ WKH VHFUHWDU\ WR GLVDSSURYH




     
       7KH +RQRUDEOH :DOWHU +HUEHUW 5LFH &KLHI 8QLWHG 6WDWHV 'LVWULFW
sXGJH IRU WKH 6RXWKHUQ 'LVWULFW RI 2KLR VLWWLQJ E\ GHVLJQDWLRQ
1R                         %DLUGHWDOY1RUWRQHWDO        

WKHP%DLUGDQG3HWHUVDUJXHWKDWWKHFRPSDFWVDSSURYHGE\
%DEELWW ZHUH QHYHU SURSHUO\ HQWHUHG LQWR E\ WKH 6WDWH RI
0LFKLJDQ EHFDXVH WKH VWDWH OHJLVODWXUH IROORZHG
XQFRQVWLWXWLRQDOSURFHGXUHVLQFRQVLGHULQJWKHP7KXVWKH\
DUJXH 6HFUHWDU\ %DEELWW FRXOG QRW SURSHUO\ DSSURYH WKH
FRPSDFWVXQGHUWKH,QGLDQ*DPLQJ5HJXODWRU\$FWm,*5$l
86&HWVHT2Q0D\WKHGLVWULFWFRXUW
JUDQWHGWKHVHFUHWDU\jVPRWLRQWRGLVPLVVSXUVXDQWWR)HG5
&LY3EDQG,QJUDQWLQJWKHVHFUHWDU\jVPRWLRQWR
GLVPLVVWKHGLVWULFWFRXUWFRQFOXGHGWKDW3HWHUVGLGQRWKDYH
$UWLFOH,,,VWDQGLQJDVDVWDWHOHJLVODWRUEXWWKDW%DLUGGLG
:LWKUHVSHFWWR%DLUGWKHGLVWULFWFRXUWFRQFOXGHGWKDW,*5$
GLGQRWLQFOXGHDQLPSOLHGULJKWRIDFWLRQWKDW%DLUGZDVQRW
LQ WKH ]RQH RI LQWHUHVWV SURWHFWHG E\ ,*5$ DQG WKXV WKDW
%DLUGGLGQRWKDYHVWDQGLQJWRFKDOOHQJHWKHVHFUHWDU\jVDFWLRQ
XQGHU WKH $GPLQLVWUDWLYH 3URFHGXUH $FW  86&  
%HFDXVHZHFRQFOXGHWKDWQHLWKHU%DLUGQRU3HWHUVKDV$UWLFOH
,,,VWDQGLQJZH$)),50WKHGLVWULFWFRXUWjVJUDQWLQJRIWKH
VHFUHWDU\jVPRWLRQWRGLVPLVV
                          ,%$&.*5281'
  %DLUGDQG3HWHUVFRQWHQGWKDWWKH0LFKLJDQVWDWHOHJLVODWXUH
GLGQRWIROORZSURFHGXUHVUHTXLUHGE\WKHVWDWHFRQVWLWXWLRQ
IRUDSSURYDORIWKHJDPLQJFRPSDFWVDWLVVXH5DWKHUWKDQ
DSSURYH WKH FRPSDFWV E\ OHJLVODWLRQ ZKLFK UHTXLUHV WKDW D
PDMRULW\ RI WKH PHPEHUV RI ERWK WKH VWDWH KRXVH RI
UHSUHVHQWDWLYHVDQGVWDWHVHQDWHYRWHLQIDYRURIWKHPHDVXUH
VHH0LFK&RQVWDUW,9WKHVWDWHOHJLVODWXUHDSSURYHG
WKH FRPSDFWV E\ FRQFXUUHQW UHVROXWLRQ n LQ WKLV FDVH E\
&RQFXUUHQW5HVROXWLRQm&5l3DVVDJHRIDFRQFXUUHQW
UHVROXWLRQ KRZHYHU UHTXLUHV RQO\ D PDMRULW\ RI YRWHV FDVW


     
      sDQHW 5RFKHIRUW 7UHDVXUHU RI sDFNVRQ &RXQW\ 0LFKLJDQ ZDV DOVR
D SODLQWLII LQ WKLV OLWLJDWLRQ   7KH GLVWULFW FRXUW GLVPLVVHG KHU FODLPV IRU
ODFN RI VWDQGLQJ $OWKRXJK 5RFKHIRUW ZDV OLVWHG LQ WKH QRWLFH RI DSSHDO
WKH GLVPLVVDO RI KHU     FODLPV KDV QRW EHHQ DUJXHG E\ WKH DSSHOODQWV
0RUHRYHU 5RFKHIRUW ODFNV VWDQGLQJ IRU WKH UHDVRQV JLYHQ E\ WKH GLVWULFW
FRXUW VKH FDQQRW HVWDEOLVK DQ LQMXU\ LQ IDFW EHFDXVH WKH JDPLQJ FRPSDFWV
LQ LVVXH GR QRW SURYLGH IRU FDVLQRV LQ sDFNVRQ &RXQW\
     %DLUGHWDOY1RUWRQHWDO                   1R       1R                        %DLUGHWDOY1RUWRQHWDO                

UDWKHU WKDQ D PDMRULW\ RI DOO PHPEHUVj YRWHV  7KXV WKH        OHJLVODWLRQ$VQRWHGDERYHKRZHYHUDGHSULYDWLRQRIKHU
0LFKLJDQ +RXVH RI 5HSUHVHQWDWLYHV FRPSULVHG RI                  mULJKW>@ WR SDUWLFLSDWH DQG YRWH RQ OHJLVODWLRQ LQ D PDQQHU
PHPEHUVDSSURYHGWKHJDPLQJFRPSDFWVE\DYRWHRIIRUW\                 GHILQHG E\ WKH >0LFKLJDQ@ &RQVWLWXWLRQl IDOOV RXWVLGH WKH
HLJKW WR IRUW\VHYHQ ZLWK %DLUG YRWLQJ LQ WKH PLQRULW\          VFRSHRI&ROHPDQDQG5DLQHVDQGWKHUHIRUHGRHVQRWFRQIHU
$OWKRXJKWKLVYRWHPDUJLQZRXOGKDYHEHHQLQVXIILFLHQWWR                 $UWLFOH,,,VWDQGLQJ6HH&KHQRZHWK)GDW
HQDFW OHJLVODWLRQ LW ZDV VXIILFLHQW WR SDVV &5   ,Q WKH
0LFKLJDQ6HQDWHZKLFKKDVWKLUW\HLJKWPHPEHUV&5                     %DVHGRQWKHUHDVRQLQJDQGFLWDWLRQRIDXWKRULW\VHWIRUWK
SDVVHGE\DYRWHRIWZHQW\RQHWRVHYHQWHHQZLWK3HWHUVLQ               DERYH , DJUHH WKDW %DLUG ODFNV $UWLFOH ,,, VWDQGLQJ WR
WKHPLQRULW\7KH6HQDWHYRWHRQWKHFRQFXUUHQWUHVROXWLRQ              FKDOOHQJHWKHDFWLRQVRIWKH6HFUHWDU\RIWKH,QWHULRUEXWIRU
WKHQZRXOGKDYHEHHQVXIILFLHQWWRSDVVOHJLVODWLRQDSSURYLQJ            UHDVRQVRWKHUWKDQKHUIDLOXUHWRVXHDVSDUWRIDEORF
WKHFRPSDFWV
   $IWHU SDVVDJH RI &5  WKH JDPLQJ FRPSDFWV ZHUH
VXEVHTXHQWO\ FRQVLGHUHG DSSURYHG ZKHQ 6HFUHWDU\ %DEELWW
IDLOHG WR DSSURYH RU UHMHFW WKHP ZLWKLQ  GD\V  6HH 
86&G&7KHFRPSDFWVZHUHWKHQSXEOLVKHG
LQWKH)HGHUDO5HJLVWHUDQGEHFDPHHIIHFWLYHXQGHU86&
G%
                         ,,$1$/<6,6
   7KHWKUHVKROGLVVXHLQWKLVFDVHLVZKHWKHU%DLUGDQG3HWHUV
KDYHVWDQGLQJWRVXHEDVHGRQWKHLUVWDWXVDVVWDWHOHJLVODWRUV
DJJULHYHG E\ WKH VWDWH OHJLVODWXUHjV XVH RI DOOHJHGO\
XQFRQVWLWXWLRQDO SURFHGXUHV  7KH GLVWULFW FRXUW IRXQG WKDW
%DLUGKDVVWDQGLQJEXWWKDW3HWHUVGRHVQRW3HWHUVDUJXHVLQ
WKLV DSSHDO WKDW WKH GLVWULFW FRXUW HUUHG LQ UHDFKLQJ WKLV
FRQFOXVLRQ EXW IRU WKH UHDVRQV JLYHQ EHORZ WKH GLVWULFW
FRXUWjV FRQFOXVLRQ UHJDUGLQJ 3HWHUV ZDV FRUUHFW  ,Q WKLV
DSSHDO%DLUGDVVHUWVWKDWWKHGLVWULFWFRXUWSURSHUO\IRXQGWKDW
VKHKDVVWDQGLQJEHFDXVHRIKHUVWDWXVDVDVWDWHOHJLVODWRUDQG
WKHDSSHOOHHVKDYHQRWGLVSXWHG%DLUGjV$UWLFOH,,,VWDQGLQJ
7KLVFRXUWKRZHYHULVmXQGHUDQLQGHSHQGHQWREOLJDWLRQWR
H[DPLQHlLWVRZQMXULVGLFWLRQDQGmVWDQGLQJµLVSHUKDSVWKH                     
                                                                                 ,Q 6DUDWRJD &RXQW\ WKH VWDWH OHJLVODWRUV KDG QR RSSRUWXQLW\ WR YRWH
PRVWLPSRUWDQWRI>WKHMXULVGLFWLRQDO@GRFWULQHVl):3%6               IRU RU DJDLQVW WKH JDPLQJ FRPSDFW DV *RYHUQRU 3DWDNL QHYHU SUHVHQWHG LW

,QF Y &LW\ RI 'DOODV  86    TXRWLQJ       WR WKHP ,Q WKH SUHVHQW FDVH RI FRXUVH %DLUG GLG SDUWLFLSDWH LQ D YRWH RQ

$OOHQ Y :ULJKW  86    DOWHUDWLRQ LQ        &5  +RZHYHU JLYHQ %DLUGjV DOOHJDWLRQ WKDW WKH YRWH RQ &5  ZDV

):3%6%HFDXVHZHFRQFOXGHWKDW%DLUGWRRODFNV$UWLFOH              D QXOOLW\ EHFDXVH JDPLQJ FRPSDFWV PXVW EH DSSURYHG E\ OHJLVODWLRQ VKH


,,,VWDQGLQJWRVXHZHGRQRWKDYHMXULVGLFWLRQWRFRQVLGHUWKH          FDQQRW     EH   PHDQLQJIXOO\   GLVWLQJXLVKHG   IURP   WKH   VWDWH   OHJLVODWRUV
                                                                          6DUDWRJD &RXQW\ ,Q ERWK FDVHV WKH DOOHJHG GHSULYDWLRQ DW LVVXH LV D ORVV
                                                                                                                                                            LQ


RWKHULVVXHVUDLVHGLQWKLVDSSHDO                                       RI WKH ULJKW WR YRWH RQ JDPLQJ FRPSDFWV LQ WKH PDQQHU SUHVFULEHG E\ VWDWH
                                                                          ODZ
       %DLUGHWDOY1RUWRQHWDO                     1R          1R                   %DLUGHWDOY1RUWRQHWDO        

GRHVQRWLQIOLFWDQLQMXU\LQIDFWVXIILFLHQWWRFRQIHU$UWLFOH,,,                  %DLUG DQG 3HWHUV DUJXH WKDW WKH\ VXIIHUHG WZR GLIIHUHQW
VWDQGLQJ                                                                        LQMXULHV DV D UHVXOW RI WKH VHFUHWDU\jV IDLOXUH WR UHMHFW WKH
                                                                                  FRPSDFWVDWLVVXH)LUVW%DLUGDQG3HWHUVDUJXHWKDWWKH\KDYH
   ,Q FRQFOXVLRQ , QRWH WKDW WKH IRUHJRLQJ UHDVRQLQJ LV                  EHHQLQMXUHGE\EHLQJGHSULYHGRIWKHSURFHGXUDOVDIHJXDUGV
FRQVLVWHQWZLWK6DUDWRJD&RXQW\&KDPEHURI&RPPHUFH,QF                         UHTXLUHG E\ WKH 0LFKLJDQ &RQVWLWXWLRQ IRU WKH SDVVDJH RI
Y3DWDNL1<6G1<$SS'LYZKLFK                          OHJLVODWLRQVXFKDVWKHUHDGLQJRISURSRVHGOHJLVODWLRQWKUHH
ZDVGHFLGHGDSSUR[LPDWHO\WKUHHZHHNVDIWHURUDODUJXPHQW                         WLPHV DQG WKH UHTXLUHPHQW WKDW WKH OHJLVODWLRQ EH LQ WKH
LQ WKH SUHVHQW FDVH ,Q 6DUDWRJD &RXQW\ 1HZ <RUN VWDWH                  SRVVHVVLRQRIERWKKRXVHVDWOHDVWILYHGD\VEHIRUHDQ\YRWH
OHJLVODWRUVDQGRWKHUVVXHG*RYHUQRU3DWDNLDOOHJLQJWKDWKH                     6HH 0LFK &RQVW  DUW ,9    7KH GLVWULFW FRXUW
LPSURSHUO\HQWHUHGLQWRDQ,QGLDQJDPLQJFRPSDFWSXUVXDQW                        FRUUHFWO\UHMHFWHGWKHVHFODLPHGLQMXULHVDVLQVXIILFLHQWWRJLYH
WR WKH ,*5$ ZLWKRXW REWDLQLQJ DSSURYDO IURP WKH VWDWH                    WKH DSSHOODQWV VWDQGLQJ LQ WKH SUHVHQW FDVH  7KHVH
OHJLVODWXUH7KHSODLQWLIIOHJLVODWRUVLQ6DUDWRJD&RXQW\ZHUH                    FRQVWLWXWLRQDOPHDVXUHVDUHFOHDUO\GHVLJQHGWRmSUHFOXGHODVW
GHSULYHGRIDQ\RSSRUWXQLW\WRYRWHIRURUDJDLQVWWKHJDPLQJ                     PLQXWHKDVW\OHJLVODWLRQDQGWRSURYLGHQRWLFHWRWKHSXEOLFRI
FRPSDFWDV*RYHUQRU3DWDNLQHYHUSUHVHQWHGWKHFRPSDFWWR                        OHJLVODWLRQXQGHUFRQVLGHUDWLRQl$QGHUVRQY2DNODQG&RXQW\
WKHOHJLVODWXUHDWDOO8SRQUHYLHZWKHDSSHOODWHFRXUWKHOG                     &OHUN1:G0LFKDQGQRWWRSURWHFW
WKDWWKHOHJLVODWRUVjDOOHJHGmLQMXU\lnGHQLDORIWKHLUULJKWWR                   LQGLYLGXDO VWDWH OHJLVODWRUV  %HFDXVH RI WKLV GHQLDO RI
YRWHRQDSSURYDORIWKHFRPSDFWnZDVLQVXIILFLHQWWRFRQIHU                        SURFHGXUDOVDIHJXDUGVWKHQ%DLUGDQG3HWHUVKDYHDWPRVW
mOHJLVODWRUVWDQGLQJlXSRQWKHP,QUHDFKLQJWKLVFRQFOXVLRQ                    D JHQHUDOL]HG JULHYDQFH VKDUHG E\ DOO 0LFKLJDQ UHVLGHQWV
WKHFRXUWUHDVRQHGWKDWmWKHLUFODLPRIVWDQGLQJLVEDVHGRQD                    DOLNH6XFKDJULHYDQFHGRHVQRWJLYHWKHPVWDQGLQJWRVXH
ORVVRISROLWLFDOSRZHUUDWKHUWKDQWKHDVVHUWLRQWKDWWKH\KDYH                  6HH6FKOHVLQJHUY5HVHUYLVWV&RPP WR 6WRSWKH:DU
EHHQ GHSULYHG RI VRPHWKLQJ WR ZKLFK WKH\ SHUVRQDOO\ DUH                   86    m>6@WDQGLQJ WR VXH PD\ QRW EH
HQWLWOHGl,GDW:LWKUHVSHFWWRWKHOHJLVODWRUVjDUJXPHQW                  SUHGLFDWHGXSRQDQLQWHUHVWZKLFKLVKHOGLQFRPPRQE\
WKDW*RYHUQRU3DWDNLKDGDFWHGLPSURSHUO\WKHFRXUWQRWHG                        DOOPHPEHUVRIWKHSXEOLFEHFDXVHRIWKHQHFHVVDULO\DEVWUDFW
WKDWWKHLUFODLPGLGQRWmGLIIHUHQWLDWHlWKHPIURPWKHJHQHUDO                    QDWXUHRIWKHLQMXU\DOOFLWL]HQVVKDUHl
SXEOLF,GFLWLQJLQWHUDOLD5DLQHVY%\UG86
DQG&KHQRZHWKY&OLQWRQ)G'&&LU                            6HFRQG %DLUG DQG 3HWHUV DUJXH WKDW WKHLU YRWHV ZHUH
                                                                          QXOOLILHGE\WKHVWDWHOHJLVODWXUHjVXVHRILPSURSHUSURFHGXUHV
                                                                                  LQ HQDFWLQJ WKH JDPLQJ FRPSDFWV  8QGHU FHUWDLQ
  /LNHZLVH %DLUG DUJXHV WKDW WKH 6HFUHWDU\ RI WKH ,QWHULRU               FLUFXPVWDQFHVYRWHQXOOLILFDWLRQPD\JLYHOHJLVODWRUVVWDQGLQJ
DFWHGXQODZIXOO\E\HQGRUVLQJWKHJDPLQJFRPSDFWVZLWKRXW                         WRFKDOOHQJHLPSURSHUSURFHGXUHV6HH5DLQHVY%\UG
REWDLQLQJ YDOLG DSSURYDO IURP WKH 0LFKLJDQ OHJLVODWXUH DV                 86&ROHPDQY0LOOHU86
UHTXLUHG E\ VWDWH ODZ $V LQ 6DUDWRJD &RXQW\ %DLUG                       %XW%DLUGDQG3HWHUVKDYHQRWVXIIHUHGDYRWHQXOOLILFDWLRQ
FRPSODLQVWKDWVKHZDVGHSULYHGRIWKHRSSRUWXQLW\WRYRWHRQ                     LQMXU\VXIILFLHQWWRJLYHWKHPVWDQGLQJLQWKHSUHVHQWFDVH
                                                                                     7KH OHDGLQJ FDVH RQ OHJLVODWRU VWDQGLQJ EDVHG RQ YRWH
                                                                                 QXOOLILFDWLRQLV&ROHPDQY0LOOHU,Q&ROHPDQWKH6XSUHPH
      :KLOH   1HZ    <RUNjV   VWDQGLQJ   UHTXLUHPHQWV   GR   QRW   PLUURU   WKH
                                                                                  &RXUWKHOGWKDWDJURXSRI.DQVDVVWDWHVHQDWRUVKDGVWDQGLQJ
UHTXLUHPHQWV RI $UWLFOH ,,, ERWK 1HZ <RUN ODZ DQG $UWLFOH ,,, UHTXLUH DQ
mLQMXU\ LQ IDFWl DQG WKH DQDO\VLV RI WKDW LVVXH LV HVVHQWLDOO\ WKH VDPH XQGHU
                                                                                  WRVXHZKHQWKH\FODLPHGWKDWWKHLUYRWHVKDGEHHQHIIHFWLYHO\
1HZ <RUN DQG IHGHUDO ODZ 6HH HJ 6RFj\ RI 3ODVWLFV ,QGXV ,QF Y
                                                                                  QXOOLILHG E\ WKH VWDWH OHJLVODWXUHjV XVH RI DQ DOOHJHGO\
&RXQW\ RI 6XIIRON    1<G    1(G  1<                XQFRQVWLWXWLRQDO SURFHGXUH  ,Q YRWLQJ RQ D SURSRVHG

     %DLUGHWDOY1RUWRQHWDO                   1R       1R                     %DLUGHWDOY1RUWRQHWDO        

FRQVWLWXWLRQDO DPHQGPHQW WKH IRUW\PHPEHU .DQVDV 6WDWH              ,GDW
6HQDWHKDGGLYLGHGHYHQO\ZLWKWZHQW\.DQVDVVWDWHVHQDWRUV
YRWLQJ IRU UDWLILFDWLRQ DQG WZHQW\ DJDLQVW  7KH .DQVDV             ,Q VKRUW WKH &KHQRZHWK FRXUW FRQFOXGHG WKDW WKH
OLHXWHQDQWJRYHUQRUWKHQFDVWWKHWLHEUHDNLQJYRWHLQIDYRU             OHJLVODWRUVjDOOHJHGmLQMXU\LQIDFWlnWKHLUORVVRIWKHULJKWWR
DQGWKHDPHQGPHQWZDVWUHDWHGDVUDWLILHGDVDUHVXOW6HH               YRWHRQWKHULYHUSUHVHUYDWLRQSURJUDPGXHWRmWKH3UHVLGHQWjV
&ROHPDQ86DW7KH&ROHPDQSODLQWLIIVLQFOXGLQJ              VXFFHVVIXO HIIRUW µWR XVXUS &RQJUHVVLRQDO DXWKRULW\ E\
WKHWZHQW\VWDWHVHQDWRUVZKRKDGYRWHGDJDLQVWUDWLI\LQJWKH             LPSOHPHQWLQJDSURJUDPIRUZKLFK>KH@KDVQRFRQVWLWXWLRQDO
DPHQGPHQWFODLPHGWKDWWKHOLHXWHQDQWJRYHUQRUjVYRWHKDG                DXWKRULW\LQDPDQQHUFRQWUDU\WRWKH&RQVWLWXWLRQjlnZDV
EHHQLPSURSHUDQGXQFRQVWLWXWLRQDODQGWKXVVRXJKWDZULWRI              LQVXIILFLHQWWRFRQIHU$UWLFOH,,,VWDQGLQJ,GDW
PDQGDPXV WR FRPSHO VWDWH RIILFLDOV WR UHFRJQL]H WKDW WKH
DPHQGPHQW KDG QRW EHHQ SURSHUO\ UDWLILHG  6HH LG  7KH            /LNHZLVH LQ WKH SUHVHQW FDVH %DLUG FRQWHQGV WKDW WKH
6XSUHPH &RXUW FRQFOXGHG WKDW WKH &ROHPDQ SODLQWLIIV KDG            6HFUHWDU\ RI WKH ,QWHULRUjV HQGRUVHPHQW RI WKH JDPLQJ
VWDQGLQJWRFKDOOHQJHWKHSURFHGXUHEDVHGRQWKHHIIHFWLYH               FRPSDFWV ZKLFK RFFXUUHG LQ WKH DEVHQFH RI OHJLVODWLRQ
QXOOLILFDWLRQ RI WKHLU YRWHV EXW KHOG DJDLQVW WKHP RQ WKH       DXWKRUL]LQJ WKHP GHSULYHG KHU RI WKH ULJKW WR YRWH RQ WKH
PHULWVRIWKHLUFODLP6HHLGDW                              FRPSDFWV LQ WKH PDQQHU SUHVFULEHG E\ WKH 0LFKLJDQ
                                                                          &RQVWLWXWLRQ$VLQ&KHQRZHWKKRZHYHUKHUORVVRIWKHULJKW
  7KH 6XSUHPH &RXUW UHFHQWO\ FODULILHG LWV KROGLQJ LQ              WRYRWHDVWKHUHVXOWRIDOOHJHGO\XQODZIXOH[HFXWLYHDFWLRQ
&ROHPDQLQ5DLQHVY%\UG5DLQHVLQYROYHGDFKDOOHQJHWR
WKHFRQVWLWXWLRQDOLW\RIWKH/LQH,WHP9HWR$FW3XE/1R
  6WDW    )RXU VHQDWRUV DQG WZR
+RXVHPHPEHUVEURXJKWWKHVXLWFODLPLQJWKDWWKH$FWZRXOG                   
UHGXFH WKHLU YRWLQJ HIIHFWLYHQHVV RQ IXWXUH DSSURSULDWLRQV                $OWKRXJK 5DLQHV DQG &KHQRZHWK ERWK LQYROYHG IHGHUDO OHJLVODWRUV
ELOOV  6HH 5DLQHV  86 DW   7KH 5DLQHV SODLQWLIIV    WKH 'LVWULFW RI &ROXPELD &LUFXLW &RXUW RI $SSHDOV KDV UHFRJQL]HG WKDW WKH

UHOLHGKHDYLO\RQ&ROHPDQjVVXJJHVWLRQWKDWOHJLVODWRUVKDYH              UHDVRQLQJ XQGHUO\LQJ 5DLQHV DSSOLHV HTXDOO\ WR VXLWV EURXJKW E\ VWDWH
                                                                          OHJLVODWRUV 6HH $ODVND /HJLVODWLYH &RXQFLO Y %DEELWW  )G 
mD SODLQ GLUHFW DQG DGHTXDWH LQWHUHVW LQ PDLQWDLQLQJ WKH         '& &LU 
HIIHFWLYHQHVVRIWKHLUYRWHVl,GDW7KH5DLQHV&RXUW
UHMHFWHGWKLVEURDGUHDGLQJRI&ROHPDQKRZHYHUKROGLQJWKDW                 
                                                                                &KHQRZHWK DQG WKH SUHVHQW FDVH SODLQO\ ERWK LQYROYH D FKDOOHQJH WR
WKHOHJLVODWRUVODFNHGVWDQGLQJEHFDXVHWKH\KDGDOOHJHGQR               DOOHJHGO\ XQODZIXO H[HFXWLYH DFWLRQ WKDW GHSULYHG ODZPDNHUV RI WKH ULJKW
PRUH WKDQ mWKH DEVWUDFW GLOXWLRQ RI LQVWLWXWLRQDO OHJLVODWLYH      WR YRWH ,Q &KHQRZHWK WKH SODLQWLIIV DUJXHG WKDW IRUPHU 3UHVLGHQW
SRZHUl  ,G DW   7KH &RXUW GLVWLQJXLVKHG WKH IDFWV LQ     &OLQWRQjV LVVXDQFH RI DQ H[HFXWLYH RUGHU IRU WKH SURWHFWLRQ RI ULYHUV
5DLQHVIURPWKRVHLQ&ROHPDQVWUHVVLQJWKDWWKHVL[5DLQHV               GHSULYHG WKHP RI WKH ULJKW WR YRWH RQ OHJLVODWLRQ SURSRVLQJ VXFK
                                                                          SURWHFWLRQ DV UHTXLUHG E\ WKH 8QLWHG 6WDWHV &RQVWLWXWLRQ &KHQRZHWK 
SODLQWLIIVKDGQRWDOOHJHGmWKDWWKH\YRWHGIRUDVSHFLILFELOO          )G DW  /LNHZLVH LQ WKH SUHVHQW FDVH %DLUG DUJXHV WKDW WKH 6HFUHWDU\
WKDWWKHUHZHUHVXIILFLHQWYRWHVWRSDVVWKHELOODQGWKDWWKH           RI WKH ,QWHULRUjV HQGRUVHPHQW RI WKH JDPLQJ FRPSDFWV GHSULYHG KHU RI WKH
ELOOZDVQRQHWKHOHVVGHHPHGGHIHDWHGl,GDW,QVWHDG             ULJKW WR YRWH RQ OHJLVODWLRQ SURSRVLQJ WKH FRPSDFWV DV UHTXLUHG E\ WKH
WKH5DLQHVSODLQWLIIVKDGVLPSO\YRWHGDJDLQVWDELOOmWKHLU             0LFKLJDQ &RQVWLWXWLRQ ,Q WKH SUHVHQW FDVH RI FRXUVH WKH UHDVRQ ZK\ WKH
YRWHV ZHUH JLYHQ IXOO HIIHFWl LQ WKDW YRWH EXW WKH ELOO ZDV   6HFUHWDU\jV HQGRUVHPHQW RI WKH FRPSDFWV ZDV DOOHJHGO\ XQODZIXO LV WKDW

SDVVHG GHVSLWH WKHLU QD\ YRWHV  ,G  ,Q VKRUW WKH 5DLQHV     SURSHU OHJLVODWLYH SURFHGXUHV ZHUH QRW IROORZHG SULRU WR WKH 6HFUHWDU\jV
                                                                          HQGRUVHPHQW 7KH IDFW UHPDLQV KRZHYHU WKDW %DLUGjV OHJDO FKDOOHQJH DV
SODLQWLIIVj FRPSODLQW ZDV WKDW WKH\ KDG ORVW D YRWH DQG          LQ &KHQRZHWK LV WR DOOHJHGO\ XQODZIXO H[HFXWLYH DFWLRQ 7KLV LV DSSDUHQW
EHOLHYHGWKDWWKHUHVXOWLQJOHJLVODWLRQZDVXQFRQVWLWXWLRQDO             IURP WKH IDFW WKDW VKH KDV QDPHG WKH 6HFUHWDU\ RI WKH ,QWHULRU DV WKH
                                                                          GHIHQGDQW DOOHJLQJ LQWHU DOLD WKDW WKH JDPLQJ FRPSDFWV WKH 6HFUHWDU\
                                                                          VLJQHG DUH XQFRQVWLWXWLRQDO 6HH HJ s$ DW   
    %DLUGHWDOY1RUWRQHWDO                  1R       1R                  %DLUGHWDOY1RUWRQHWDO      

LQWKHIRUPRIOHJLVODWLRQDVRSSRVHGWRWKHDOOHJHGO\mQXOODQG         EXWWKLVZDVQRWDVXIILFLHQWLQMXU\WRJLYHWKHPVWDQGLQJWR
YRLGlFRQFXUUHQWUHVROXWLRQ KHUmLQMXU\lLVLQVXIILFLHQWWR           VXHEDVHGRQQXOOLILFDWLRQ
FRQIHU $UWLFOH ,,, VWDQGLQJ %DLUG FRPSODLQV WKDW WKH
6HFUHWDU\jVHQGRUVHPHQWRIWKHJDPLQJFRPSDFWVVXEVHTXHQW                  7KHVWDWHOHJLVODWRUVLQ&ROHPDQLQFRQWUDVWKDGDOOHJHGD
WRWKHSDVVDJHRIWKHFRQFXUUHQWUHVROXWLRQGHSULYHGKHURI             YRWHQXOOLILFDWLRQLQMXU\VXIILFLHQWWRJLYHWKHPVWDQGLQJWR
WKHRSSRUWXQLW\WRSDUWLFLSDWHLQDYDOLGYRWHRQOHJLVODWLRQ            VXH EHFDXVH KDG WKHVH VWDWH VHQDWRUV EHHQ mFRUUHFW RQ WKH
SURSRVLQJ WKH FRPSDFWV DV UHTXLUHG E\ WKH 0LFKLJDQ               PHULWVl WKHLU YRWHV ZRXOG KDYH EHHQ VXIILFLHQW WR GHIHDW
&RQVWLWXWLRQ,WLVHYLGHQWKRZHYHUWKDWVXFKDQLQMXU\IDOOV          UDWLILFDWLRQ6HH5DLQHV86DW,QWKLVFRQWH[W
RXWVLGH WKH VFRSH RI &ROHPDQ DQG 5DLQHV ,QGHHG DV WKH         WKH 5DLQHV &RXUW HPSKDVL]HG WKDW WKH WZHQW\ .DQVDV VWDWH
'LVWULFW RI &ROXPELD &LUFXLW &RXUW RI $SSHDOV UHFHQWO\            VHQDWRUVLQ&ROHPDQmZHUHVXLQJDVDEORFl,GDW7KH
UHFRJQL]HGLQ&KHQRZHWKY&OLQWRQ)G'&              5DLQHV &RXUWjV VXPPDU\ RI &ROHPDQ LQGLFDWHV WKDW WKH
&LUFHUWGHQLHG86DGHSULYDWLRQ            DJJUHJDWHQDWXUHRIWKHVWDWHVHQDWRUVjFODLPZDVHVVHQWLDOWR
RI WKH mULJKW>@ WR SDUWLFLSDWH DQG YRWH RQ OHJLVODWLRQ LQ D    WKHLUVWDQGLQJm>2@XUKROGLQJLQ&ROHPDQVWDQGVDWPRVW
PDQQHU GHILQHG E\ WKH    &RQVWLWXWLRQl LV LQVXIILFLHQW WR   IRUWKHSURSRVLWLRQWKDWOHJLVODWRUVZKRVHYRWHVZRXOGKDYH
FRQIHU$UWLFOH,,,VWDQGLQJ                                             EHHQVXIILFLHQWWRGHIHDWDVSHFLILFOHJLVODWLYH$FWKDYH
                                                                         VWDQGLQJWRVXHLIWKDWOHJLVODWLYHDFWLRQJRHVLQWRHIIHFW
  ,Q &KHQRZHWK WKH FRXUW KHOG WKDW PHPEHUV RI &RQJUHVV          RQ WKH JURXQG WKDW WKHLU YRWHV KDYH EHHQ FRPSOHWHO\
ODFNHG VWDQGLQJ WR FKDOOHQJH WKH FRQVWLWXWLRQDOLW\ RI DQ          QXOOLILHGl,GDWLQWHUQDOFURVVUHIHUHQFHRPLWWHG
([HFXWLYH2UGHUIRUWKHSURWHFWLRQRIULYHUV7KHOHJLVODWRUVLQ
&KHQRZHWKFODLPHGWKDWIRUPHU3UHVLGHQW&OLQWRQjVFUHDWLRQ                  )RUOHJLVODWRUVWRKDYHVWDQGLQJDVOHJLVODWRUVWKHQWKH\
RIDULYHUSUHVHUYDWLRQSURJUDPE\([HFXWLYH2UGHUGHSULYHG              PXVW SRVVHVV YRWHV VXIILFLHQW WR KDYH HLWKHU GHIHDWHG RU
WKHPRImµWKHLUFRQVWLWXWLRQDOO\JXDUDQWHHGUHVSRQVLELOLW\RI            DSSURYHG WKH PHDVXUH DW LVVXH  7KH SUHVHQW FDVH LV WKXV
RSHQ GHEDWH DQG YRWH RQ LVVXHV DQG OHJLVODWLRQj LQYROYLQJ        GLVWLQJXLVKDEOHIURP&ROHPDQ,Q&ROHPDQWKHWZHQW\VWDWH
LQWHUVWDWHFRPPHUFHIHGHUDOODQGVWKHH[SHQGLWXUHRIIHGHUDO           VHQDWRUV ZKR YRWHG DJDLQVW WKH SURSRVHG FRQVWLWXWLRQDO
PRQLHVDQGLPSOHPHQWDWLRQRIWKH>1DWLRQDO(QYLURQPHQWDO                DPHQGPHQW ZRXOG KDYH EHHQ mVXIILFLHQWl WR GHIHDW WKH
3ROLF\ $FW@l ,G DW  7KH GLVWULFW FRXUW GLVPLVVHG WKH      PHDVXUHKDGWKHOLHXWHQDQWJRYHUQRUQRWYRWHG7KXVWKURXJK
ODZVXLW IRU ODFN RI VWDQGLQJ UHDVRQLQJ WKDW WKH OHJLVODWRUVj    WKHXVHRIWKLVDOOHJHGO\LPSURSHUSURFHGXUHWKHYRWHVRIWKH
LQMXU\nWKH ORVV RI WKHLU ULJKW WR YRWH RQ WKH SUHVHUYDWLRQ      WZHQW\VWDWHVHQDWRUVVHHNLQJUHOLHIZHUHFRPSOHWHO\QXOOLILHG
SURJUDPnZDVmWRRDEVWUDFWDQGQRWVXIILFLHQWO\VSHFLILFWR               LHmRYHUULGGHQDQGYLUWXDOO\KHOGIRUQDXJKWl&ROHPDQ
VXSSRUWDILQGLQJRIVWDQGLQJl,G8SRQUHYLHZWKH'LVWULFW            86DW,QWKHSUHVHQWFDVHLQFRQWUDVWWKHRQO\PHPEHU
RI&ROXPELD&LUFXLW&RXUWRI$SSHDOVDIILUPHG5HO\LQJXSRQ              RIWKH0LFKLJDQ+RXVHRI5HSUHVHQWDWLYHVVHHNLQJUHOLHILV
5DLQHVWKHDSSHOODWHFRXUWUHDVRQHG                                    %DLUG  %DLUG FODLPV YRWH QXOOLILFDWLRQ EXW KHU YRWH DORQH
                                                                         ZRXOGQRWKDYHEHHQVXIILFLHQWWRGHIHDWHLWKHUWKHFRQFXUUHQW
     ,IDVWKH&RXUWKHOGLQ5DLQHVDVWDWXWHWKDWDOOHJHGO\           UHVROXWLRQZKLFKSDVVHGGHVSLWHKHUmQD\lYRWHRUOHJLVODWLRQ
  mGLYHVWV>FRQJUHVVPHQ@RIWKHLUFRQVWLWXWLRQDOUROHlLQWKH            WRVLPLODUHIIHFW7KH0LFKLJDQ&RQVWLWXWLRQPD\UHTXLUHD
  OHJLVODWLYHSURFHVVGRHVQRWJLYHWKHPVWDQGLQJWRVXH                PDMRULW\RIDOOPHPEHUVjYRWHVIRUOHJLVODWLRQWREHDSSURYHG
  WKHQQHLWKHUGRHVDQ([HFXWLYH2UGHUWKDWDOOHJHGO\              EXWLWGRHVQRWUHTXLUHXQDQLPLW\&I5DLQHV86DW
  GHSULYHVFRQJUHVVPHQRIWKHLUmULJKW>@WRSDUWLFLSDWHDQG              QFLWLQJ%HQGHUY:LOOLDPVSRUW$UHD6FK'LVW86
  YRWH RQ OHJLVODWLRQ LQ D PDQQHU GHILQHG E\ WKH                 Q7KXVDOWKRXJK%DLUGjVLQVWLWXWLRQDO
  &RQVWLWXWLRQl                                                         SRZHU ZDV GLOXWHG WKURXJK WKH XVH RI WKH FRQWLQXLQJ
       %DLUGHWDOY1RUWRQHWDO                     1R         1R                   %DLUGHWDOY1RUWRQHWDO       

UHVROXWLRQ SURFHGXUH VKH KDV QRW VXIIHUHG DQ LQMXU\ WKDW               E\WKH0LFKLJDQ&RQVWLWXWLRQLHVKHZDVGHSULYHGRIWKH
VDWLVILHVWKHVWULQJHQWUHTXLUHPHQWVIRUOHJLVODWRUVWDQGLQJVHW                RSSRUWXQLW\WRYRWHRQOHJLVODWLRQSURSRVLQJWKHFRPSDFWV,Q
RXWLQ5DLQHV6LPLODUO\6WDWH6HQDWRU3HWHUVjVYRWHZDVQRW                  SDUWLFXODUVKHUHDVRQVWKDW
QXOOLILHGE\WKHFRQFXUUHQWUHVROXWLRQSURFHGXUHEHFDXVHWKH
YRWHLQWKHVWDWHVHQDWHVDWLVILHGWKHFRQVWLWXWLRQDOUHTXLUHPHQW                 >E@\ RIIHULQJ D FRQFXUUHQW UHVROXWLRQ LQVWHDG RI
RIDPDMRULW\RIDOOPHPEHUVIRUWKHSDVVDJHRIOHJLVODWLRQ                      OHJLVODWLRQ WKH UHTXLUHPHQWV RI WKH 0LFKLJDQ
7KXV 3HWHUV FDQQRW DUJXH WKDW KLV YRWH ZDV VXIILFLHQW WR                &RQVWLWXWLRQ ZHUH VXEYHUWHG +DG WKRVH UHTXLUHPHQWV
GHIHDWWKHSDVVDJHRIOHJLVODWLRQKDYLQJWKHVDPHHIIHFWDV&5                    EHHQKRQRUHG$SSHOODQW/HJLVODWRUVjmYRWHVZRXOGKDYH
                                                                              EHHQGHFLVLYHLQGHIHDWLQJlWKHDSSURYDORIWKH>JDPLQJ
                                                                                  FRPSDFWV@&ROHPDQDW867KXVMXVWDVLQ
   8QGHU5DLQHVKRZHYHULI%DLUGjVODZVXLWKDGEHHQMRLQHG                      &ROHPDQ WKH $SSHOODQW /HJLVODWRUVj YRWHV KHUH ZHUH
E\RWKHUPHPEHUVRIWKH0LFKLJDQ+RXVHRI5HSUHVHQWDWLYHV                         UHQGHUHGFRPSOHWHO\LQHIIHFWLYH
ZKRVHWRWDOYRWHVDQGQRQYRWHVZRXOGKDYHEHHQVXIILFLHQW
WR GHIHDW WKH QHFHVVDU\ OHJLVODWLRQ WKHQ WKLV JURXS RI                 $SSHOODQWVj%ULHIDW
ODZPDNHUVOLNHWKHWZHQW\VWDWHVHQDWRUVLQ&ROHPDQZRXOG
KDYHKDGVWDQGLQJDVOHJLVODWRUVEDVHGRQYRWHQXOOLILFDWLRQ                      8SRQUHYLHZ,FDQQRWDJUHHZLWK%DLUGjVDVVHUWLRQWKDWWKH
,IIRUH[DPSOH%DLUGKDGEHHQMRLQHGE\HLJKWRIWKHILIWHHQ                  SUHVHQWFDVHLVDQDORJRXVWR&ROHPDQSDUWLFXODUO\DVLWKDV
PHPEHUVRIWKH0LFKLJDQ+RXVHZKRGLGQRWYRWHZKHQ&5                          EHHQQDUURZO\FRQVWUXHGE\5DLQHV$VQRWHGDERYH&ROHPDQ
ZDVSDVVHGWKHQWKHLUQRQYRWHVFRXSOHGZLWKWKHIRUW\                   VWDQGVmDWPRVWlIRUmWKHSURSRVLWLRQWKDWOHJLVODWRUVZKRVH
VHYHQYRWHVDFWXDOO\FDVWDJDLQVW&5ZRXOGKDYHEHHQ                       YRWHV ZRXOG KDYH EHHQ VXIILFLHQW WR GHIHDW RU HQDFW D
VXIILFLHQW WR GHIHDW WKH OHJLVODWLRQ WKDW %DLUG FODLPV LV               VSHFLILFOHJLVODWLYH$FWKDYHVWDQGLQJWRVXHLIWKDWOHJLVODWLYH
FRQVWLWXWLRQDOO\UHTXLUHGnLHHLJKWRIWKHQRQYRWHVSOXV                  DFWLRQ JRHV LQWR HIIHFW RU GRHV QRW JR LQWR HIIHFW RQ WKH
IRUW\VHYHQ mQD\l YRWHV HIIHFWLYHO\ HTXDOV ILIW\ILYH YRWHV              JURXQG WKDW WKHLU YRWHV KDYH EHHQ FRPSOHWHO\ QXOOLILHGl
DJDLQVW WKH PHDVXUH XQGHU WKH 0LFKLJDQ &RQVWLWXWLRQjV                     5DLQHV86DWIRRWQRWHRPLWWHG8QGHUWKLVWHVW
UHTXLUHPHQWWKDWDPDMRULW\RIDOOYRWHVLVQHFHVVDU\WRHQDFW                  %DLUGODFNVVWDQGLQJ7KHRQO\mVSHFLILFOHJLVODWLYH$FWlRU
OHJLVODWLRQ                                                                   mOHJLVODWLYH DFWLRQl DW LVVXH LQ WKH SUHVHQW FDVH LV &5 
                                                                                8QOLNH WKH OHJLVODWRUV LQ &ROHPDQ %DLUG DQG WKH RWKHU
                                                                                RSSRQHQWVRIWKHFRPSDFWVODFNHGVXIILFLHQWYRWHVWRGHIHDW
                                                                                &5&RQVHTXHQWO\DSSO\LQJWKHODQJXDJHRI5DLQHVLW
    
      7KLV DSSURDFK PD\ DSSHDU FRXQWHULQWXLWLYH LQ LWV VXJJHVWLRQ WKDW         FDQQRWEHVDLGWKDWWKHUHZHUHmVXIILFLHQWYRWHVlWRGHIHDW&5
QRQYRWHV FDQ EH HIIHFWLYHO\ QXOOLILHG WKURXJK WKH XVH RI LPSURSHU              EXWWKDWLWZHQWLQWRHIIHFWDQ\ZD\WKHUHE\QXOOLI\LQJWKH
SURFHGXUHV ,Q UHTXLULQJ D PDMRULW\ RI DOO YRWHV IRU WKH SDVVDJH RI             YRWH RI %DLUG RU WKH RWKHU RSSRQHQWV RI WKH FRQFXUUHQW
OHJLVODWLRQ KRZHYHU WKH 0LFKLJDQ &RQVWLWXWLRQ JLYHV WKLV HIIHFW WR QRQ
YRWHV    &RQVLGHU WKH IROORZLQJ K\SRWKHWLFDO         &RXQWLQJ QRVHV WKH
                                                                                UHVROXWLRQ&RQVHTXHQWO\HYHQLI%DLUGDQGKHUFROOHDJXHV
SURSRQHQWV RI D PHDVXUH NQRZ WKDW LW LV RSSRVHG E\ ILIW\ILYH RI WKH 
                                                                                KDGVXHGDVDEORFWKH\VWLOOZRXOGODFN$UWLFOH,,,VWDQGLQJ
PHPEHUV RI WKH 0LFKLJDQ +RXVH 7KXV WKH\ GR QRW EULQJ WKH PHDVXUH WR           &RQWUDU\WR%DLUGjVDVVHUWLRQWKH6HFUHWDU\RIWKH,QWHULRUjV
WKH IORRU DV OHJLVODWLRQ EXW LQVWHDG ZDLW XQWLO WKH PHDVXUHjV VXSSRUWHUV        DSSURYDO RI WKH JDPLQJ FRPSDFWV GLG QRW QXOOLI\ DQ\RQHjV
PDNH XS D PDMRULW\ RI WKRVH SUHVHQW :KHQ WKDW KDSSHQV WKH PHDVXUHjV           YRWH
SURSRQHQWV EULQJ LW XS DV D FRQFXUUHQW UHVROXWLRQ HYHQ WKRXJK WKH VWDWH
FRQVWLWXWLRQ UHTXLUHV LWV SDVVDJH E\ OHJLVODWLRQ DQG LW SDVVHV E\ D PDMRULW\
RI YRWHV FDVW ,Q WKLV VFHQDULR WKH QRQYRWHV KDYH EHHQ HIIHFWLYHO\
                                                                                  ,QVRIDUDV%DLUGVXJJHVWVWKDWWKH6HFUHWDU\RIWKH,QWHULRU
QXOOLILHG LH GHSULYHG RI WKH HIIHFW WKDW WKH 0LFKLJDQ &RQVWLWXWLRQ JUDQWV
                                                                                XQODZIXOO\HQGRUVHGWKHJDPLQJFRPSDFWVZLWKRXWREWDLQLQJ
WKHP                                                                           SURSHUDSSURYDOIURPWKH0LFKLJDQOHJLVODWXUHLHDSSURYDO
       %DLUGHWDOY1RUWRQHWDO                  1R        1R                 %DLUGHWDOY1RUWRQHWDO    

EHFDXVHWKH\KDGQRWDOOHJHGDVXIILFLHQWO\FRQFUHWHLQMXU\                  ,Q VXP %DLUGjV FRPSODLQW LV QRW WKDW WKH FRPSDFWV
,QUHDFKLQJWKLVFRQFOXVLRQWKH5DLQHV&RXUWUHDG&ROHPDQ                   WKHPVHOYHVDUHXQFRQVWLWXWLRQDO,QVWHDGKHUFRPSODLQWLVWKDW
DV VWDQGLQJ mDW PRVWl IRU mWKH SURSRVLWLRQ WKDW OHJLVODWRUV          WKH FRPSDFWV ZRXOG KDYH EHHQ GHIHDWHG KDG WKH
ZKRVHYRWHVZRXOGKDYHEHHQVXIILFLHQWWRGHIHDWRUHQDFWD                FRQVWLWXWLRQDOO\UHTXLUHGSURFHGXUHVEHHQIROORZHGDQGWKXV
VSHFLILFOHJLVODWLYH$FWKDYHVWDQGLQJWRVXHLIWKDWOHJLVODWLYH            KHU YRWH DJDLQVW WKH FRPSDFWV ZDV HIIHFWLYHO\ QXOOLILHG
DFWLRQ JRHV LQWR HIIHFW RU GRHV QRW JR LQWR HIIHFW RQ WKH      8QGHU5DLQHVDQG&ROHPDQWKHLVVXHLVZKHWKHU%DLUGFDQ
JURXQG WKDW WKHLU YRWHV KDYH EHHQ FRPSOHWHO\ QXOOLILHGl              GHPRQVWUDWH WKDW KHU YRWH ZDV VXIILFLHQW WR GHIHDW WKH
5DLQHV86DWIRRWQRWHRPLWWHG                                  FRPSDFWV KDG WKH FRQVWLWXWLRQDOO\ UHTXLUHG SURFHGXUH EHHQ
                                                                             IROORZHG%HFDXVH%DLUGFDQQRWGRVRVKHODFNVVWDQGLQJ
  $IWHUUHVWULFWLQJ&ROHPDQWRWKHSURSRVLWLRQVHWIRUWKDERYH              6LPLODUO\ 6WDWH 6HQDWRU 3HWHUV ODFNV VWDQGLQJ EHFDXVH KH
WKH5DLQHV&RXUWUHDVRQHG                                                   FDQQRWVKRZWKDWKLVYRWHZDVVXIILFLHQWWRGHIHDWWKHJDPLQJ
                                                                             FRPSDFWVKDGWKHSURSHUSURFHGXUHEHHQIROORZHG
    ,WVKRXOGEHHTXDOO\REYLRXVWKDWDSSHOOHHVjFODLPGRHV
  QRW IDOO ZLWKLQ RXU KROGLQJ LQ &ROHPDQ DV WKXV                                        ,,,&21&/86,21
  XQGHUVWRRG7KH\KDYHQRWDOOHJHGWKDWWKH\YRWHGIRUD
  VSHFLILFELOOWKDWWKHUHZHUHVXIILFLHQWYRWHVWRSDVVWKH                   %HFDXVH ZH FRQFOXGH WKDW QHLWKHU %DLUG QRU 3HWHUV KDV
  ELOODQGWKDWWKHELOOZDVQRQHWKHOHVVGHHPHGGHIHDWHG                   $UWLFOH,,,VWDQGLQJLQWKHSUHVHQWFDVHZHODFNMXULVGLFWLRQWR
  ,QWKHYRWHRQWKH$FWWKHLUYRWHVZHUHJLYHQIXOOHIIHFW                DGGUHVVWKHRWKHULVVXHVUDLVHGLQWKLVDSSHDO)RUWKHUHDVRQV
  7KH\VLPSO\ORVWWKDWYRWH                                                JLYHQDERYHWKHGLVWULFWFRXUWjVGLVPLVVDORIWKHSUHVHQWFDVH
                                                                             LV$)),50('
,GDWIRRWQRWHRPLWWHG
  /LNHZLVH LQ WKH SUHVHQW FDVH LW LV HYLGHQW WKDW %DLUGjV
FODLP GRHV QRW IDOO ZLWKLQ WKH VFRSH RI &ROHPDQ DV
LQWHUSUHWHGE\5DLQHV%DLUGGRHVQRWFRQWHQGWKDWVKHYRWHG
DJDLQVW&5WKDWWKHUHZHUHVXIILFLHQWYRWHVWRGHIHDW&5
DQGWKDW&5QHYHUWKHOHVVZHQWLQWRHIIHFW7RWKH
FRQWUDU\%DLUGZDVSODLQO\RQWKHORVLQJVLGHZLWKUHVSHFWWR
WKHYRWHRQWKHFRQFXUUHQWUHVROXWLRQ$VLQ5DLQHVWKHQKHU
YRWHZDVJLYHQIXOOHIIHFW6KHVLPSO\ORVWWKDWYRWH
  %DLUGjV WUXH FRPSODLQW LV WKDW VKH ZDV GHSULYHG RI WKH
RSSRUWXQLW\WRYRWHRQWKHFRPSDFWVLQWKHPDQQHUSUHVFULEHG


     
      7KH SODLQWLIIDSSHOOHHV LQ5DLQHV   ZHUH PHPEHUV RI &RQJUHVV ZKR
KDG YRWHG DJDLQVW WKH /LQH ,WHP 9HWR $FW ZKLFK SDVVHG LQ WKH 6HQDWH E\
D YRWH RI  WR  DQG LQ WKH +RXVH E\ D YRWH RI  WR  $IWHU IRUPHU
3UHVLGHQW &OLQWRQ VLJQHG WKH $FW LQWR ODZ VL[ RI WKH ORVLQJ OHJLVODWRUV
                                                      5DLQHV
ILOHG VXLW DOOHJLQJ WKDW WKH $FW ZDV XQFRQVWLWXWLRQDO        86 DW

       %DLUGHWDOY1RUWRQHWDO                 1R        1R                  %DLUGHWDOY1RUWRQHWDO     

                      BBBBBBBBBBBBBBBBBBBB                                  RIILFLDOVWRUHFRJQL]HWKDWWKHOHJLVODWXUHKDGQRWUDWLILHGWKH
                                                                            DPHQGPHQWEHFDXVHWKH/LHXWHQDQW*RYHUQRUVKRXOGQRWKDYH
                        &21&855(1&(                                         EHHQSHUPLWWHGWRYRWH8SRQUHYLHZWKH.DQVDV6XSUHPH
                      BBBBBBBBBBBBBBBBBBBB                                  &RXUW KHOG WKDW WKH OHJLVODWRUV KDG VWDQGLQJ WR EULQJ WKHLU
                                                                            PDQGDPXVDFWLRQEXWLWUXOHGDJDLQVWWKHPRQWKHPHULWV7KH
   :$/7(5+(5%(575,&('LVWULFWsXGJHFRQFXUULQJ,                       8QLWHG6WDWHV6XSUHPH&RXUWVXEVHTXHQWO\DJUHHGKROGLQJ
FRQFXULQWKHMXGJPHQWRIWKHPDMRULW\EXW,ZULWHVHSDUDWHO\              WKDWWKHPHPEHUVRIWKHOHJLVODWXUHKDGVWDQGLQJ,QUHDFKLQJ
EHFDXVH,EHOLHYHWKDW%DLUGZRXOGODFNVWDQGLQJHYHQLIWKLV               WKLV FRQFOXVLRQ WKH &ROHPDQ &RXUW QRWHG WKDW LI WKH
ODZVXLWKDGEHHQMRLQHGE\RWKHUPHPEHUVRIWKH0LFKLJDQ                    OHJLVODWRUVZHUHFRUUHFWRQWKHPHULWVWKHQWKHLUYRWHVDJDLQVW
OHJLVODWXUH8QOLNHWKHPDMRULW\,GRQRWEHOLHYHWKDW%DLUGjV             UDWLILFDWLRQ ZHUH QXOOLILHG ,Q UHOHYDQW SDUW WKH &RXUW
ODFN RI VWDQGLQJ VWHPV IURP KHU IDLOXUH WR VXH DV SDUW RI D     UHDVRQHG
EORF5DWKHUKHUODFNRIVWDQGLQJLVDWWULEXWDEOHWRWKHIDFW
WKDWKHUYRWHRQ&5ZDVJLYHQIXOOHIIHFW$OWKRXJKVKH                   +HUHWKHSODLQWLIIVLQFOXGHWZHQW\VHQDWRUVZKRVHYRWHV
ZDV RQ WKH ORVLQJ VLGH KHU YRWH ZDV QRW LQ DQ\ VHQVH              DJDLQVW UDWLILFDWLRQ KDYH EHHQ RYHUULGGHQ DQG YLUWXDOO\
mQXOOLILHGl %DLUGjV FRPSODLQW LV VLPSO\ WKDW D FRQFXUUHQW             KHOG IRU QDXJKW DOWKRXJK LI WKH\ DUH ULJKW LQ WKHLU
UHVROXWLRQZDVDQLPSURSHUZD\IRUWKH0LFKLJDQ+RXVHRI                      FRQWHQWLRQV WKHLU YRWHV ZRXOG KDYH EHHQ VXIILFLHQW WR
5HSUHVHQWDWLYHVWRDSSURYHWKHJDPLQJFRPSDFWVDWLVVXH6KH                  GHIHDWUDWLILFDWLRQ:HWKLQNWKDWWKHVHVHQDWRUVKDYHD
FRQWHQGVWKDWVKHVKRXOGKDYHUHFHLYHGWKHRSSRUWXQLW\WRYRWH                SODLQ GLUHFW DQG DGHTXDWH LQWHUHVW LQ PDLQWDLQLQJ WKH
RQOHJLVODWLRQSURSRVLQJWKHFRPSDFWV$FFRUGLQJWR%DLUG                    HIIHFWLYHQHVVRIWKHLUYRWHV
WKH 6HFUHWDU\ RI WKH ,QWHULRU XQODZIXOO\ HQGRUVHG WKH
FRPSDFWV ZLWKRXW   REWDLQLQJ WKH QHFHVVDU\ DSSURYDO RI WKH            >7@KHWZHQW\VHQDWRUVZHUHQRWRQO\TXDOLILHGWRYRWHRQ
VWDWHOHJLVODWXUHWKHUHE\GHSULYLQJKHURIWKHULJKWWRYRWHRQ             WKH TXHVWLRQ RI UDWLILFDWLRQ EXW WKHLU YRWHV LI WKH
WKHPLQWKHPDQQHUSUHVFULEHGE\WKH0LFKLJDQ&RQVWLWXWLRQ                   /LHXWHQDQW*RYHUQRUZHUHH[FOXGHGDVQRWEHLQJDSDUWRI
6XFKDQLQMXU\KRZHYHULVLQVXIILFLHQWWRFRQIHU$UWLFOH,,,                WKHOHJLVODWXUHIRUWKDWSXUSRVHZRXOGKDYHEHHQGHFLVLYH
VWDQGLQJZLWKRUZLWKRXWWKHSUHVHQFHRI%DLUGjVFROOHDJXHV                  LQGHIHDWLQJWKHUDWLI\LQJUHVROXWLRQ
LQWKLVODZVXLW
                                                                              >:@HILQGQRGHSDUWXUHIURPSULQFLSOHLQUHFRJQL]LQJLQ
  7KHIRUHJRLQJFRQFOXVLRQLVFRQVLVWHQWZLWKDQGPDQGDWHG                   WKHLQVWDQWFDVHWKDWDWOHDVWWKHWZHQW\VHQDWRUVZKRVH
E\&ROHPDQY0LOOHU86DQG5DLQHVY                     YRWHV LI WKHLU FRQWHQWLRQ ZHUH VXVWDLQHG ZRXOG KDYH
%\UG86,Q&ROHPDQRI.DQVDVVWDWH                  EHHQ VXIILFLHQW WR GHIHDW WKH UHVROXWLRQ UDWLI\LQJ WKH
6HQDWRUV YRWHG DJDLQVW UDWLILFDWLRQ RI D FRQVWLWXWLRQDO                 SURSRVHGFRQVWLWXWLRQDODPHQGPHQWKDYHDQLQWHUHVWLQ
DPHQGPHQW7KH/LHXWHQDQW*RYHUQRUWKHQFDVWDWLHEUHDNLQJ                   WKH FRQWURYHUV\ ZKLFK WUHDWHG E\ WKH VWDWH FRXUW DV D
YRWHLQIDYRURIWKHDPHQGPHQWZKLFKZDVUDWLILHGDVDUHVXOW                EDVLVIRUHQWHUWDLQLQJDQGGHFLGLQJWKHIHGHUDOTXHVWLRQV
RIKLVYRWH7KHUHDIWHUWKHPHPEHUVRIWKH.DQVDV6HQDWH                  LVVXIILFLHQWWRJLYHWKH&RXUWMXULVGLFWLRQWRUHYLHZWKDW
ZKR KDG YRWHG DJDLQVW WKH DPHQGPHQW VRXJKW D ZULW RI                 GHFLVLRQ
PDQGDPXVIURPWKH.DQVDV6XSUHPH&RXUWWRFRPSHOVWDWH
                                                                            &ROHPDQ86DW
                                                                              7KH6XSUHPH&RXUWVXEVHTXHQWO\UHDG&ROHPDQQDUURZO\
     *LYHQ KHU EHOLHI WKDW D FRQFXUUHQW UHVROXWLRQ LV DQ XQODZIXO ZD\ IRU
WKH 0LFKLJDQ OHJLVODWXUH WR DSSURYH JDPLQJ FRPSDFWV %DLUG FRQWHQGV WKDW
                                                                            LQ5DLQHVKROGLQJWKDWPHPEHUVRI&RQJUHVVODFNHGVWDQGLQJ
&5  LV QXOO DQG YRLG s$ DW                                    WRFKDOOHQJHWKHFRQVWLWXWLRQDOLW\RIWKH/LQH,WHP9HWR$FW
