       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


521$/' 5 612:'(1                 ;
          3ODLQWLII$SSHOOHH       
                                    
                                       1R
             Y                     
                                     !
                                    
 /(;0$5. ,17(51$7,21$/             
 ,1& '28* /$1'(56                
 :$<1( 0225( '8'/(<                
 *5$9,77 )5,7= 672//*(5           
        'HIHQGDQWV$SSHOODQWV 
                                    
                                    
 *8$5'60$5. ,1&                  
            'HIHQGDQW$SSHOOHH 
                                    
                                   1
        $SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW
     IRUWKH(DVWHUQ'LVWULFWRI.HQWXFN\DW/H[LQJWRQ
1Rn+HQU\5:LOKRLWsU&KLHI'LVWULFWsXGJH
               $UJXHG'HFHPEHU
          'HFLGHGDQG)LOHGsDQXDU\
  %HIRUH0(55,771(/621DQG%$7&+(/'(5
                  &LUFXLWsXGJHV




                            
     6QRZGHQY/H[PDUN,QWjOHWDO              1R

                     BBBBBBBBBBBBBBBBB
                          &2816(/
$5*8('/DUU\$6\NHV672//.((121	3$5.
/H[LQJWRQ .HQWXFN\ IRU $SSHOODQWV  &KDUOHV : &XUU\
/H[LQJWRQ.HQWXFN\IRU$SSHOOHH21%5,()/DUU\$
6\NHV 'DYLG & 6FKZHWVFKHQDX 672// .((121 	
3$5. /H[LQJWRQ .HQWXFN\ IRU $SSHOODQWV  &KDUOHV :
&XUU\/H[LQJWRQ.HQWXFN\7KRPDV.+HUUHQ+(55(1	
$'$06/H[LQJWRQ.HQWXFN\IRU$SSHOOHH
                     BBBBBBBBBBBBBBBBB
                         23,1,21
                     BBBBBBBBBBBBBBBBB
  0(55,77&LUFXLWsXGJH7KLVFLYLOFDVHLVEURXJKWXQGHU
5,&2WKH5DFNHWHHU,QIOXHQFHGDQG&RUUXSW2UJDQL]DWLRQV
$FW$SSHOODQWVDUH/H[PDUNDPDQXIDFWXUHUDQGUHWDLOHURI
FRPSXWHUSULQWLQJSURGXFWVDQGVHYHUDOHPSOR\HHVLQYROYHG
LQ FRPSDQ\ VHFXULW\ DQG PDQDJHPHQW  $SSHOOHH 5RQDOG
6QRZGHQLVDIRUPHU/H[PDUNHPSOR\HH/H[PDUNDOOHJHV
WKDW0U6QRZGHQVWROHFRPSXWHUFKLSVIURPLWVZDUHKRXVH
DQGXVHGWKHPWRGLVWULEXWHVRIWZDUHYLDFRPSXWHULQYLRODWLRQ
RI FRS\ULJKW ODZV  :H DJUHH ZLWK WKH 'LVWULFW &RXUW WKDW
DSSHOODQWV KDYH IDLOHG WR GHPRQVWUDWH D mSDWWHUQ RI
UDFNHWHHULQJl  :H WKHUHIRUH DIILUP VXPPDU\ MXGJPHQW LQ
IDYRURI0U6QRZGHQ
    5,&2 ZDV HQDFWHG DV 7LWOH ,; RI WKH 2UJDQL]HG &ULPH
&RQWURO $FW RI  3XE / 1R   6WDW 
FRGLILHGDVDPHQGHGDW86&6HFWLRQ
FPDNHVLWXQODZIXOIRUmDQ\SHUVRQHPSOR\HGE\RU
DVVRFLDWHGZLWKDQ\HQWHUSULVHHQJDJHGLQRUWKHDFWLYLWLHVRI
ZKLFKDIIHFWLQWHUVWDWHRUIRUHLJQFRPPHUFHWRFRQGXFWRU
SDUWLFLSDWH GLUHFWO\ RU LQGLUHFWO\ LQ WKH FRQGXFW RI VXFK
HQWHUSULVHjVDIIDLUVWKURXJKDSDWWHUQRIUDFNHWHHULQJDFWLYLW\
l,QRUGHUWRHVWDEOLVKD5,&2YLRODWLRQDSODLQWLIIPXVW
VKRZWZRRUPRUHSUHGLFDWHRIIHQVHVWKHH[LVWHQFHRIDQ
mHQWHUSULVHlDQH[XVEHWZHHQWKHSDWWHUQRIUDFNHWHHULQJ
   6QRZGHQY/H[PDUN,QWjOHWDO            1R      1R              6QRZGHQY/H[PDUN,QWjOHWDO        

0RUHRYHU HYHQ DVVXPLQJ WKDW 0U 6QRZGHQ YLRODWHG           DFWLYLW\ DQG WKH HQWHUSULVH DQG  DQ LQMXU\ WR EXVLQHVV
FRS\ULJKWODZSULQFLSOHVRIIDLUQHVVDQGSULRUQRWLFHPLOLWDWH   9DQ'HQ%URHFN Y &RPPRQ3RLQW 0RUWJDJH &R  )G
DJDLQVWUHWURDFWLYHDSSOLFDWLRQRI5,&2SHQDOWLHV7RVXSSRUW    WK&LU7KH6XSUHPH&RXUWKDVGHVFULEHG
WKHLUFODLPRIUDFNHWHHULQJWKHQDSSHOODQWVDWPRVWFDQRIIHU   WKHSDWWHUQUHTXLUHPHQWDVmWKHKHDUWRIDQ\5,&2FRPSODLQWl
DVLQJOHWKHIWIURPDQLQWHUVWDWHVKLSPHQW:HDJUHHZLWKWKH    $JHQF\ +ROGLQJ &RUS Y 0DOOH\'XII 	 $VVRF ,QF 
'LVWULFW &RXUW WKDW WKLV FDQQRW VDWLVI\ WKH mSDWWHUQl      86     7KH VWDWXWH GHILQHV D mSDWWHUQ RI
UHTXLUHPHQW LPSRVHG E\ 5,&2  $FFRUGLQJO\ WKH JUDQW RI   UDFNHWHHULQJDFWLYLW\lDVUHTXLULQJ
VXPPDU\MXGJPHQWLQIDYRURI0U6QRZGHQLV$)),50('
                                                                    DWOHDVWWZRDFWVRIUDFNHWHHULQJDFWLYLW\RQHRIZKLFK
                                                                    RFFXUUHGDIWHUWKHHIIHFWLYHGDWHRIWKLVFKDSWHUDQGWKH
                                                                    ODVWRIZKLFKRFFXUUHGZLWKLQWHQ\HDUVH[FOXGLQJDQ\
                                                                    SHULRGRILPSULVRQPHQWDIWHUWKHFRPPLVVLRQRIDSULRU
                                                                    DFWRIUDFNHWHHULQJDFWLYLW\
                                                                  86&7KHVHLQVWDQFHVRIUDFNHWHHULQJOLVWHG
                                                                  DW86&DUHNQRZQDVmSUHGLFDWHDFWVl
                                                                                              ,)DFWV
                                                                     /H[PDUN LV DQ LQWHUQDWLRQDO FRUSRUDWLRQ ZLWK ZRUOG
                                                                  KHDGTXDUWHUV LQ /H[LQJWRQ .HQWXFN\  7KHUH LW DVVHPEOHV
                                                                  FRPSXWHU SULQWLQJ SURGXFWV WKDW LQFRUSRUDWH VLQJOH LQOLQH
                                                                  PHPRU\PRGXOHFKLSVFDOOHGm6,006l/H[PDUNDOVRVHOOV
                                                                  6,006 FKLSV GLUHFWO\ WR FXVWRPHUV  &RPSXWHU FKLSV
                                                                  GHVLJQDWHGIRUUHVDOHDUHVWRUHGLQDZDUHKRXVHRQFRPSDQ\
                                                                  SURSHUW\  $Q LQYHQWRU\ FKHFN LQ sDQXDU\  UHYHDOHG D
                                                                  QXPEHURIPLVVLQJXQLWV6XVSHFWLQJWKHIW/H[PDUNLQVWDOOHG
                                                                  D YLGHR FDPHUD WR PRQLWRU WKH VWRUDJH DUHD  2Q 0DUFK 
                                                                   WKH FDPHUD UHFRUGHG WZR PHQ WDNLQJ 6,006 FKLSV
                                                                  IURPWKHZDUHKRXVH/H[PDUNPDQDJHPHQWLGHQWLILHG5RQDOG
                                                                  6QRZGHQDVRQHRIWKHILJXUHVLQWKHYLGHRDQGILUHGKLPLQ
                                                                  0D\
                                                                    8QWLO KH ZDV ILUHG 5RQDOG 6QRZGHQ ZDV D \HDU
                                                                  HPSOR\HHDW/H[PDUNZKRLQVWDOOHGDQGUHSDLUHGFRPSXWHU
                                                                  QHWZRUNVHUYHUKDUGZDUH+LVLQWHUHVWLQFRPSXWHUVFDUULHG
                                                                  RYHULQWRKLVSHUVRQDOOLIH+HZDVDPHPEHURIDFRPSXWHU
                                                                  mEXOOHWLQERDUGVHUYLFHlFDOOHGWKHm$VVDVVLQjV*XLOGl$
                                                                  SUHFXUVRU RI WKH ,QWHUQHW D EXOOHWLQ ERDUG VHUYLFH LV DQ
                                                                  HOHFWURQLFIRUXPFRQQHFWHGE\FRPSXWHUVDQGPRGHPVWKDW
                                                                  SHUPLWV XVHUV WR H[FKDQJH ILOHV DQG WH[W  7KH $VVDVVLQjV
     6QRZGHQY/H[PDUN,QWjOHWDO              1R      1R               6QRZGHQY/H[PDUN,QWjOHWDO           

*XLOGZDVDQHVSHFLDOO\SRSXODUERDUGNQRZQIRUDOORZLQJ            DWWKHG6LQFH5,&2LVILUVWDFULPLQDOVWDWXWH
XVHUV WR GRZQORDG RU mSLUDWHl FRPPHUFLDO VRIWZDUH LQ        WKDWRQO\SLJJ\EDFNVFLYLOUHPHGLHVLWVKRXOGEHLQWHUSUHWHG
YLRODWLRQ RI FRS\ULJKW ODZV  7KURXJK ODZVXLWV DQG DQ        IRU UHWURDFWLYLW\ SXUSRVHV DV D FULPLQDO VWDWXWH  6HH HJ
HYHQWXDOVHWWOHPHQW0LFURVRIWDQG1RYHOOIRUFHGWKHERDUGWR        0LFKDHO65DIIRUG7KH3ULYDWH6HFXULWLHV/LWLJDWLRQ5HIRUP
VKXWGRZQLQ$SULO0U6QRZGHQDOVRKRVWHGKLVRZQ            $FW RI  5HWURDFWLYH $SSOLFDWLRQ RI WKH 5,&2
EXOOHWLQ ERDUG FDOOHG m7UDQV\OYDQLD l  $V V\VWHP          $PHQGPHQWs /(*,6 m1HZEXUGHQVRQ
RSHUDWRU KH UDQ WKH QHWZRUN PRQLWRUHG SUREOHPV DQG         SDVWWUDQVDFWLRQVDUHVWLOOXQMXVWZKHWKHUWKH\EHLQWKHIRUP
FRQILJXUHGWKHKDUGZDUH0U6QRZGHQFHDVHGWRPDLQWDLQ             RIFULPLQDORUFLYLOVDQFWLRQV6WDWXWHVVXFKDV5,&2WKDW
WKHERDUGDIWHU'HFHPEHUDQGFRPSOHWHO\VKXWLWGRZQ            FRQWDLQERWKFULPLQDODQGFLYLOFDXVHVRIDFWLRQLOOXVWUDWHWKH
LQ0DUFKs$                                          SUREOHPVRIRQO\SURKLELWLQJUHWURDFWLYHFULPLQDOODZV7KH
                                                                     SURKLELWLRQ DJDLQVW H[ SRVW IDFWR ODZV SURWHFWV D 5,&2
   2Q WKH EDVLV RI WKH ZDUHKRXVH VXUYHLOODQFH WDSH 0U      GHIHQGDQWFKDUJHGZLWKSUHGLFDWHDFWVRIIUDXGH[WRUWLRQDQG
6QRZGHQ ZDV LQGLFWHG E\ D )D\HWWH &RXQW\ JUDQG MXU\ IRU     JDPEOLQJ ZKHQ WKH VXLW LV EURXJKW E\ WKH JRYHUQPHQW
EXUJODU\ DQG WKHIW  %HFDXVH WKH YLGHRjV SRRU TXDOLW\        1HYHUWKHOHVV ZKHQ WKDW VDPH VXLW LV EURXJKW E\ D SULYDWH
GLPLQLVKHGLWVHYLGHQWLDU\YDOXHKRZHYHUWKHSURVHFXWRUODWHU      SDUW\ RQO\ D SUHVXPSWLRQ DJDLQVW UHWURDFWLYLW\ H[LVWV
GLVPLVVHGWKHFKDUJHV0U6QRZGHQWKHQILOHGDFLYLO5,&2          0RUHRYHUWKHRQO\GLIIHUHQFHPD\EHWKHSODLQWLIIVLQFHWKH
FRPSODLQW DJDLQVW /H[PDUN LQ .HQWXFN\ FLUFXLW FRXUW           JRYHUQPHQW FDQ VHHN LQMXQFWLYH DV ZHOO DV PRQHWDU\ UHOLHI
/H[PDUNUHPRYHGWKHFDVHDQGILOHGD5,&2FRXQWHUFODLP              DJDLQVW5,&2GHIHQGDQWV7KHIRFXVLQERWKVLWXDWLRQVVKRXOG
DOOHJLQJWKDW0U6QRZGHQVWROHWKHPHPRU\FKLSVDQGXVHG            EHWKHFRQGXFWLQTXHVWLRQl7KRXJKLQIULQJHPHQWZDVD
WKHPWRGLVWULEXWHFRPSXWHUVRIWZDUHRQWKH$VVDVVLQjV*XLOG         FULPLQDO RIIHQVH EHIRUH  LWV LQFOXVLRQ LQ WKH 5,&2
DQG 7UDQV\OYDQLD   $FFRUGLQJ WR /H[PDUN  0U            VFKHPH DGGV QHZ OD\HUV RI FULPLQDO VDQFWLRQV DQG FLYLO
6QRZGHQjV DFWLYLW\ RQ WKHVH ERDUGV FRQVWLWXWHG FULPLQDO        SHQDOWLHV QRW SUHYLRXVO\ SUHVHQW  6HH HJ  86&
FRS\ULJKW LQIULQJHPHQW ZKLFK DORQJ ZLWK WKH WKHIW RI WKH   FDXWKRUL]LQJWKHUHFRYHU\RIWUHEOHGDPDJHVXQGHU
FKLSV IRUPHG D SDWWHUQ RI UDFNHWHHULQJ  0U 6QRZGHQ        5,&27KXVWKHDPHQGPHQWDGGLQJFRS\ULJKWLQIULQJHPHQW
DEDQGRQHGKLV5,&2FODLPDQGPRYHGIRUVXPPDU\MXGJPHQW              WR5,&2ZRXOGFOHDUO\mLQFUHDVHDSDUW\jVOLDELOLW\IRUSDVW
RQ/H[PDUNjVFRXQWHUFODLP7KH'LVWULFW&RXUWJUDQWHGWKH           FRQGXFWlXQGHU/DQGJUDI$EVHQWFOHDUFRQJUHVVLRQDOLQWHQW
PRWLRQDQG/H[PDUNQRZDSSHDOV                                    WKH MXGLFLDO GHIDXOW UXOHV RXWOLQHG LQ /DQGJUDI UDLVH D
                                                                     SUHVXPSWLRQDJDLQVWUHWURDFWLYLW\/H[PDUNKDVQRWRYHUFRPH
   /H[PDUNRIIHUVWKUHHSUHGLFDWHDFWVWRVXSSRUWLWVFODLPRI       WKLVSUHVXPSWLRQ&I6FRWWY%RRV)GWK&LU
UDFNHWHHULQJ  ,W DFFXVHV 0U 6QRZGHQ RI VWHDOLQJ 6,006       UHIXVLQJ WR DSSO\ WKH 3ULYDWH 6HFXULWLHV /LWLJDWLRQ
FKLSVIURPLQWHUVWDWHVKLSPHQWVLQsDQXDU\DQG0DUFKRI         5HIRUP$FWRIUHWURDFWLYHO\ZKLFKDPHQGHG5,&2WR
LQYLRODWLRQRI86&,WDOVRFKDUJHV0U6QRZGHQ        UHPRYHVHFXULWLHVIUDXGDVDSUHGLFDWHDFW$FFRUG0DWKHZV
ZLWK SDUWLFLSDWLQJ LQ FULPLQDO FRS\ULJKW LQIULQJHPHQW LQ       Y.LGGHU3HDERG\	&R,QF)GG&LU
YLRODWLRQRI86&$FFRUGLQJWR/H[PDUNWKHVH
WKUHH DFWV FRDOHVFH LQWR D mVRIWZDUH SLUDWLQJ RSHUDWLRQl                              ,,,&RQFOXVLRQ
$SSHOODQW%UDW
                                                                       7RSUHYDLORQD5,&2FODLPDSODLQWLIIPXVWVKRZWZRDFWV
                        ,,'LVFXVVLRQ                              RIUDFNHWHHULQJDFWLYLW\DVDmPLQLPXPQHFHVVDU\FRQGLWLRQl
                                                                     +s,QF86DW7KHDOOHJDWLRQWKDW0U6QRZGHQ
  ,QLQWHUSUHWLQJ86&WKH6XSUHPH&RXUWKDV         ZDVLQYROYHGLQWKHsDQXDU\WKHIWLVZKROO\XQVXEVWDQWLDWHG
GHYHORSHG D mFRQWLQXLW\ SOXV UHODWLRQVKLSl WHVW E\ ZKLFK
      6QRZGHQY/H[PDUN,QWjOHWDO                1R    1R              6QRZGHQY/H[PDUN,QWjOHWDO         

    DWWDLQGHU  $Q\RQH ZKR KDV HQJDJHG LQ WKH SURKLELWHG      RWKHUZLVH GLVSDUDWH DFWV PD\ EH ZRYHQ LQWR D SURKLELWHG
    DFWLYLWLHVEHIRUHWKHHIIHFWLYHGDWHRIWKHOHJLVODWLRQLVRQ     SDWWHUQRIUDFNHWHHULQJ+s,QFY1RUWKZHVWHUQ%HOO7HO
    SULRU QRWLFH WKDW RQO\ RQH IXUWKHU DFW PD\ WULJJHU WKH   &R867KHSDWWHUQUHTXLUHPHQWRID
    LQFUHDVHGSHQDOWLHVDQGQHZUHPHGLHVRIWKLVFKDSWHU            5,&2 DFWLRQ LV VDWLVILHG E\ VKRZLQJ  D UHODWLRQVKLS
                                                                      EHWZHHQ WKH SUHGLFDWH DFWV DQG  WKH WKUHDW RI FRQWLQXHG
6 5(3 12DW                                    DFWLYLW\6DJOLRFFRORY(DJOH,QV&R)G
                                                                      WK&LUFLWLQJ+s,QF86DW
  /H[PDUN LQWHUSUHWV WKLV ODQJXDJH DV DOVR DXWKRUL]LQJ
UHWURDFWLYHDSSOLFDWLRQRIDPHQGPHQWVWR5,&2,WLVWUXHWKDW         :HQHHGQRWSUREHWKHUHODWLRQVKLSDPRQJWKH SUHGLFDWH
&RQJUHVVVZHSWLQDFWVFRPPLWWHGEHIRUH5,&2jVHIIHFWLYH              DFWV FODLPHG LQ WKLV FDVH KRZHYHU  %HFDXVH /H[PDUN KDV
GDWHRI2FWREHUDVSUHGLFDWHRIIHQVHV$SSHOODQWV          IDLOHGWRVKRZHYHQWKHH[LVWHQFHRIWZRSUHGLFDWHDFWVZHGR
ZRXOG H[WUDSRODWH IURP WKH  OHJLVODWLRQ WR WKH        QRWUHDFKWKHTXHVWLRQRIWKHLUUHODWHGQHVVRUFRQWLQXLW\
DPHQGPHQW  %XW /H[PDUN IDLOV WR FRPSOHWH WKH DQDORJ\
EHWZHHQ WKH ILUVW SDVVDJH RI 5,&2 DQG LWV VXEVHTXHQW                         $7KH0LVVLQJ6,006&KLSV
UHYLVLRQ  $ 5,&2 DFWLRQ FRXOG LQFRUSRUDWH DFWV EHIRUH
2FWREHU   RQO\ LI WKH GHIHQGDQW DOVR HQJDJHG LQ         /H[PDUNjVRQO\SURRIRIZURQJGRLQJLVWKHVXUYHLOODQFH
SURKLELWHGDFWLYLWLHVDIWHUWKDWGDWH,IWKHDPHQGPHQWVDUHWR      WDSH RI WKH 0DUFK WKHIW  0U 6QRZGHQ FRQFHGHV WKDW KLV
UHDFKEDFNLQWKHVDPHPDQQHUDVWKHRULJLQDOOHJLVODWLRQWKHQ       LGHQWLILFDWLRQLQWKHYLGHRLVVXIILFLHQWWRZLWKVWDQGVXPPDU\
WKH\WRRPXVWKDYHWKHVDIHJXDUGRImSULRUQRWLFHl,QWKLV          MXGJPHQW$SSHOOHH%UDW9LHZLQJWKHIDFWVLQWKHOLJKW
FDVH 0U 6QRZGHQjV LQIULQJLQJ DFWLYLW\ EHIRUH sXO\          PRVWIDYRUDEOHWR/H[PDUNZHZLOOFRQFHGHWKDWWKHUHPD\EH
nWKHHIIHFWLYHGDWHRIWKH$QWLFRXQWHUIHLWLQJ&RQVXPHU            D JHQXLQH IDFWXDO GLVSXWH DERXW ZKHWKHU WKH PLVVLQJ FKLSV
3URWHFWLRQ$FWnFDQQRWVHUYHDVDSUHGLFDWHDFWXQOHVVKHDOVR         ZHUHWDNHQIURPDQmLQWHUVWDWHVKLSPHQWlDVUHTXLUHGE\
LQIULQJHG DIWHU sXO\    7KLV KH GLG QRW GR  7KH   86&7KXVIRUSXUSRVHVRIWKLVVXPPDU\MXGJPHQW
$QWLFRXQWHUIHLWLQJ$FWVLPSO\SXWKLPRQQRWLFHWKDWIXWXUH           PRWLRQ/H[PDUN PD\ SURSHUO\FODLPWKH0DUFKWKHIWDVD
FRS\ULJKWYLRODWLRQVFRXOGWULJJHU5,&2DQGSURYLGHDEDVLV           5,&2SUHGLFDWHDFWWKDWLPSOLFDWHV0U6QRZGHQ
IRU LQFRUSRUDWLQJ SULRU DFWV RI LQIULQJHPHQW  %HFDXVH
/H[PDUNGRHVQRWFODLPWKDW0U6QRZGHQFRPPLWWHGDQ\DFW                7KHVDPHFDQQRWEHVDLGIRUWKHRWKHUDOOHJHGWKHIW7KHUH
RIUDFNHWHHULQJDIWHUsXO\WKHDOOHJHGLQIULQJHPHQW          LVVLPSO\QRHYLGHQFHWKDW0U6QRZGHQVWROH/H[PDUNFKLSV
EHIRUHWKDWGDWHFDQQRWEHLQFOXGHGDVDSUHGLFDWHDFWXQGHU          LQ sDQXDU\,QIDFWWKHUHLVQRHYLGHQFHWKDWDQ\RQH
5,&2                                                                VWROH WKH FKLSV  :KDW /H[PDUN FDOOV DQ mXQH[SODLQHG
                                                                      VKRUWDJHl PLJKW MXVW DV ZHOO KDYH EHHQ PLVSODFHG RU
   :H DJUHH ZLWK WKH 'LVWULFW &RXUW WKDW &RQJUHVV GLG QRW    PLVGHOLYHUHG LQYHQWRU\  $SSHOODQWV KDYH QRW VKRZQ
SUHVFULEH WKH UHDFK RI WKH $QWLFRXQWHUIHLWLQJ $FW              RWKHUZLVHLQVWHDGVSHFXODWLQJm$ORJLFDOLQIHUHQFHLVWKDW
)XUWKHUPRUH ZH DUH XQSHUVXDGHG WKDW 5,&2jV OHJLVODWLYH         WKHVDPHSHUVRQVZKRVWROHWKH6,006LQ0DUFKZHUHDOVR
KLVWRU\IURPQRZGLFWDWHVUHWURDFWLYHDSSOLFDWLRQRIWKH         UHVSRQVLEOH IRU WKH VLPLODU WKHIW IURP WKH VDPH ORFDWLRQ LQ
DPHQGPHQWZKHQ0U6QRZGHQKDVQRWHQJDJHGLQDQ\                sDQXDU\l$SSHOODQW%UDW7KLVZKROO\XQVXEVWDQWLDWHG
UDFNHWHHULQJ DIWHU LWV HIIHFWLYH GDWH  0RUHRYHU WKH 'XH     FODLPFDQQRWVHUYHDVDSUHGLFDWHDFWHYHQDWWKLVVWDJHLQWKH
3URFHVVDQG([3RVW)DFWR&ODXVHVGRQRWSHUPLWFULPLQDO              SURFHHGLQJVm7RZLWKVWDQGDGHIHQVHPRWLRQIRUVXPPDU\
SHQDOWLHVWREHLPSRVHGUHWURDFWLYHO\6HHJHQHUDOO\1250$1          MXGJPHQW>WKHSODLQWLII@PXVWDGGXFHVRPHFRQFUHWHHYLGHQFH
s 6,1*(5 687+(5/$1' 67$78725< &216758&7,21                 RQ ZKLFK D UHDVRQDEOH MXURU FRXOG UHWXUQ D YHUGLFW LQ KLV
                                                                      IDYRUl  )UDQN Y 'j$PEURVL  )G   WK &LU
     6QRZGHQY/H[PDUN,QWjOHWDO              1R      1R             6QRZGHQY/H[PDUN,QWjOHWDO            

DIILUPLQJVXPPDU\MXGJPHQWDJDLQVWD5,&2SODLQWLII            ) 6XSS   6'1<  SHQDOL]LQJ EDQN
ZKR RIIHUHG RQO\ mZLOG DQG XQVXSSRUWHG VWDWHPHQWVl WR         IUDXGUHWURDFWLYHO\DVD5,&2SUHGLFDWHRIIHQVH
VXSSRUWKLVFODLPFLWLQJ$QGHUVRQY/LEHUW\/REE\,QF
86                                              6LJQLILFDQWO\:LHQHUZDVGHFLGHGEHIRUH/DQGJUDIY86,
                                                                     )LOP 3URGXFWV  86    ,Q /DQGJUDI WKH
         %7KH$OOHJHG&RS\ULJKW,QIULQJHPHQW                      6XSUHPH&RXUWFRQVLGHUHGWKHVFRSHRIWKH&LYLO5LJKWV
                                                                     $FWFRQFOXGLQJWKDWWKHSHWLWLRQHUZDVQRWHQWLWOHGWRDMXU\
   $VDVHFRQGSUHGLFDWHDFW/H[PDUNDOVRFODLPVWKDW0U           WULDO RQ D VH[XDO KDUDVVPHQW DFWLRQ FRPPHQFHG LQ 
6QRZGHQ SDUWLFLSDWHG LQ FULPLQDO FRS\ULJKW LQIULQJHPHQW        ([DPLQLQJWKHmDQWLUHWURDFWLYLW\SULQFLSOHlHPEHGGHGLQWKH
0U 6QRZGHQ RSHUDWHG D EXOOHWLQ ERDUG VHUYLFH FDOOHG          &RQVWLWXWLRQWKH&RXUWREVHUYHG
m7UDQV\OYDQLD l DQG ZDV D PHPEHU RI DQRWKHU ERDUG
FDOOHG WKH m$VVDVVLQjV *XLOGl  7KH ODWWHU ZDV NQRZQ IRU      :KHQDFDVHLPSOLFDWHVDIHGHUDOVWDWXWHHQDFWHGDIWHUWKH
GLVWULEXWLQJVRIWZDUHLQYLRODWLRQRIFRS\ULJKWODZV/H[PDUN         HYHQWV LQ VXLW WKH FRXUWjV ILUVW WDVN LV WR GHWHUPLQH
GRHV QRW FODLP D SURSULHWDU\ LQWHUHVW LQ WKH FRS\ULJKWV       ZKHWKHU&RQJUHVVKDVH[SUHVVO\SUHVFULEHGWKHVWDWXWHjV
KRZHYHU  7KH RQO\ FRQQHFWLRQ EHWZHHQ /H[PDUN DQG WKH          SURSHUUHDFK,I&RQJUHVVKDVGRQHVRRIFRXUVHWKHUHLV
DOOHJHGLQIULQJHPHQWLVLWVDVVHUWLRQWKDWmLWLVORJLFDOWRLQIHU     QR QHHG WR UHVRUW WR MXGLFLDO GHIDXOW UXOHV  :KHQ
WKDW DW OHDVW VRPH RI WKH VWROHQ 6,006 ZHUH XWLOL]HG DV      KRZHYHUWKHVWDWXWHFRQWDLQVQRVXFKH[SUHVVFRPPDQG
FRPSRQHQWV RI WKH LOOHJDO %%6V >EXOOHWLQ ERDUG VHUYLFHV@        WKHFRXUWPXVWGHWHUPLQHZKHWKHUWKHQHZVWDWXWHZRXOG
ZKLFK6QRZGHQRSHUDWHGRUSDUWLFLSDWHGLQl$SSHOODQW%U             KDYH UHWURDFWLYH HIIHFW LH ZKHWKHU LW ZRXOG LPSDLU
DW/H[PDUNIXUWKHUPDLQWDLQVmLWLVDOVROLNHO\WKDWWKH       ULJKWVDSDUW\SRVVHVVHGZKHQKHDFWHGLQFUHDVHDSDUW\jV
VWROHQ6,006ZHUHVROGWKURXJK6QRZGHQjV%%6l,GDW             OLDELOLW\ IRU SDVW FRQGXFW RU LPSRVH QHZ GXWLHV ZLWK
                                                                       UHVSHFWWRWUDQVDFWLRQVDOUHDG\FRPSOHWHG,IWKHVWDWXWH
  (YHQDVVXPLQJWKDW0U6QRZGHQSDUWLFLSDWHGLQFRPSXWHU              ZRXOGRSHUDWHUHWURDFWLYHO\RXUWUDGLWLRQDOSUHVXPSWLRQ
SLUDF\nDQGWKHIDFWVDUHE\QRPHDQVFOHDUFRQFHUQLQJKLV              WHDFKHVWKDWLWGRHVQRWJRYHUQDEVHQWFOHDUFRQJUHVVLRQDO
LQYROYHPHQWnWKLVFRQGXFWGRHVQRWEULQJKLPZLWKLQUHDFK               LQWHQWIDYRULQJVXFKDUHVXOW
RI5,&2&RS\ULJKWLQIULQJHPHQWEHFDPHD5,&2SUHGLFDWH
DFWDVRIsXO\6HHWKH$QWLFRXQWHUIHLWLQJ&RQVXPHU         ,GDW
3URWHFWLRQ$FWRI3XE/1R6WDW
 DGGLQJ FULPLQDO FRS\ULJKW LQIULQJHPHQW  86&          ,QWKLVFDVHWKH'LVWULFW&RXUWIRXQGWKDW&RQJUHVVKDGQRW
 WR WKHOLVWRI5,&2SUHGLFDWHRIIHQVHVIRXQGDW         LQGLFDWHG WKH UHDFK RI WKH $QWLFRXQWHUIHLWLQJ &RQVXPHU
86&  %  /H[PDUN DFNQRZOHGJHV WKDW 0U          3URWHFWLRQ$FW/H[PDUNFRXQWHUVWKLVOHJLVODWLYHVLOHQFHE\
6QRZGHQjVDOOHJHGLQIULQJHPHQWWRRNSODFHEHIRUH5,&2ZDV            VXJJHVWLQJWKDW&RQJUHVVLQWHQGHGDEURDGUHWURDFWLYHGHVLJQ
DPHQGHGWRLQFOXGHFRS\ULJKWYLRODWLRQV$SSHOODQW%UDW       IRU 5,&2 DV HQDFWHG LQ   $SSHOODQWV DUJXH WKDW WKH
$FFRUGLQJWR/H[PDUNWKRXJKWKHDPHQGPHQWVKRXOGKDYH              GHILQLWLRQRImSDWWHUQRIUDFNHWHHULQJDFWLYLW\lLVEDFNZDUGV
UHWURDFWLYHHIIHFWUHDFKLQJEDFNWRVXEMHFW0U6QRZGHQjV           ORRNLQJE\QHJDWLYHLPSOLFDWLRQ6HH86&
FRPSXWLQJDFWLYLWLHVWR5,&2SHQDOWLHV,WFLWHVDFDVHIURP        7KH 6HQDWH sXGLFLDU\ &RPPLWWHH FRPPHQWHG RQ WKLV
1HZ <RUN IRU WKH SURSRVLWLRQ WKDW EHFDXVH FRS\ULJKW           SURYLVLRQLQQRWLQJ
LQIULQJHPHQWZDVXQODZIXOEHIRUHLWVLQFOXVLRQXQGHU
5,&2mGRHVQRWLQWURGXFHDQHZFULPHl:LHQHUY1DSROL             2QH DFW LQ WKH SDWWHUQ PXVW EH HQJDJHG LQ DIWHU WKH
                                                                       HIIHFWLYH GDWH RI WKH OHJLVODWLRQ 7KLV DYRLGV WKH
                                                                       SURKLELWLRQ DJDLQVW H[ SRVW IDFWR ODZV DQG ELOOV RI
