7KH7DURW

,WV2FFXOW6LJQLILFDQFH8VHLQ)RUWXQH7HOOLQJ
DQG0HWKRGRI3OD\(WF
%\6/0DF*UHJRU0DWKHUV

7KH7DURW

,WV2FFXOW6LJQLILFDQFH8VHLQ)RUWXQH7HOOLQJ
DQG0HWKRGRI3OD\(WF

7RHQWHUZLWKLQWKHOLPLWVRIWKLVVKRUWWUHDWLVHXSRQDQ\ORQJLQTXLU\
LQWRWKH+LVWRU\RI&DUGVLVXWWHUO\RXWRIWKHTXHVWLRQDQG,VKDOO
WKHUHIRUHFRQILQHP\VHOIWRH[DPLQLQJEULHIO\LQWRZKDWUHODWHVWRWKHLU
PRVWDQFLHQWIRUPWKH7DURWRU7DURFFKL&DUGVDQGWRJLYLQJDV
FOHDUO\DQGFRQFLVHO\DVSRVVLEOHLQVWUXFWLRQVZKLFKZLOOHQDEOHP\
UHDGHUVWRXWLOLVHWKHPIRUIRUWXQHWHOOLQJWRZKLFKWKH\DUHIDUEHWWHU
DGDSWHGIURPWKHJUHDWHUQXPEHUDQGYDULHW\RIWKHLUFRPELQDWLRQV
WKDQWKHRUGLQDU\FDUGV,VKDOODOVRHQWHUVRPHZKDWLQWRWKHLURFFXOW
DQG4DEDOLVWLFDOVLJQLILFDWLRQV
7KHWHUP7DURWRU7DURFFKLLVDSSOLHGWRDSDFNRIFDUGV
FRQVLVWLQJRIIRXUVXLWVRIFDUGVHDFKWKHUHEHLQJRQHPRUHFRXUW
FDUGWKDQLQWKHRUGLQDU\SDFNVWKH&DYDOLHU.QLJKWRU+RUVHPDQ

DQGV\PEROLFDOSLFWXUHFDUGVDQVZHULQJIRUWUXPSV7KHVHODWWHUDUH
QXPEHUHGIURPWRLQFOXVLYHWKHQGFDUGEHLQJPDUNHG=HUR
7KHGHVLJQVRIWKHVHWUXPSVDUHH[WUHPHO\VLQJXODUDPRQJWKHPEHLQJ
VXFKUHSUHVHQWDWLRQVDV'HDWKWKH'HYLOWKH/DVW-XGJPHQW F
7KHLGHDWKDWFDUGVZHUHILUVWLQYHQWHGWRDPXVH&KDUOHV9,RI)UDQFH
LVQRZH[SORGHGDQGLWLVZRUWK\RIQRWHLQWKLVFRQQHFWLRQWKDWWKHLU
VXSSRVLWLWLRXVLQYHQWRUZDV-DFTXHV*ULQJRQQHXUDQ$VWURORJHUDQG
4DEDOLVW)XUWKHUPRUHFDUGVZHUHNQRZQSULRUWRWKLVSHULRGDPRQJ
WKH,QGLDQVDQGWKH&KLQHVH(WWHLOODLQGHHGJLYHVLQRQHRIKLVWUDFWV
RQWKH7DURWDUHSUHVHQWDWLRQRIWKHP\VWLFDODUUDQJHPHQWRIWKHVH
FDUGVLQWKH7HPSOHRI3WDKDW0HPSKLVDQGKHIXUWKHUVD\V
8SRQDWDEOHRUDOWDUDWWKHKHLJKWRIWKHEUHDVWRIWKH(J\SWLDQ
0DJXVRU+LHURSKDQWZHUHRQRQHVLGHDERRNRUDVVHPEODJHRI
FDUGVRUSODWHVRIJROGWKH7DURWDQGRQWKHRWKHUDYDVHHWF7KLV
LGHDLVIXUWKHUGLODWHGXSRQE\3&KULVWLDQWKHGLVFLSOHRI(OLSKDV
/HYLLQKLV+LVWRLUHGHOD0DJLHWRZKLFK,VKDOOKDYHRFFDVLRQWR
UHIHUODWHU7KHJUHDWH[SRQHQWVRIWKH7DURW&RXUWGH*qEHOLQ/HYL
DQG(WWHLOODKDYHDOZD\VDVVLJQHGWRWKH7DURWD4DEDOLVWLFR(J\SWLDQ
RULJLQDQGWKLV,KDYHIRXQGFRQILUPHGLQP\RZQUHVHDUFKHVLQWRWKLV
VXEMHFWZKLFKKDYHH[WHQGHGRYHUVHYHUDO\HDUV
:+XJKHV:LOOVKLUHLQKLVUHPDUNVRQWKH*HQHUDO+LVWRU\RI
3OD\LQJ&DUGVVD\V7KHPRVWDQFLHQWFDUGVZKLFKKDYHFRPHGRZQ
WRXVDUHRIWKH7DURWVFKDUDFWHU7KHVHDUHWKHIRXUFDUGVRIWKH0XVpH
&RUUHUDW9HQLFHWKHVHYHQWHHQSLHFHVRIWKH3DULV&DELQHW
HUURQHRXVO\RIWHQFDOOHGWKH*ULQJRQQHXURU&KDUOHV9,FDUGVRI
ILYH9HQHWLDQ7DURWVRIWKHILIWHHQWKFHQWXU\LQWKHRSLQLRQRI
VRPHQRWRIDQHDUOLHUGDWHWKDQDQGWKHVHULHVRIFDUGVEHORQJLQJ
WRD0LQFKLDWHVHWLQWKHSRVVHVVLRQRIWKH&RXQWHVV$XUHOLD9LVFRQWL
*RQ]DJDDW0LODQZKHQ&LFRJQDUDZURWH
:$&KDWWRLQKLV+LVWRU\RI3OD\LQJ&DUGVVD\VWKDWFDUGVZHUH
LQYHQWHGLQ&KLQDDVHDUO\DV$'LQWKHUHLJQRI6HXQ+RIRU
WKHDPXVHPHQWRIKLVQXPHURXVFRQFXELQHV
-)9DLOODQWLQ/HV5RPHVKLVWRLUHYUDLHGHVYUDLHV%RKpPLHQV
3DULVVD\VWKDWWKH&KLQHVHKDYHDGUDZLQJGLYLGHGLQWR
FRPSDUWPHQWVRUVHULHVEDVHGRQFRPELQDWLRQVRIWKHQXPEHUL>L@,W
VRFORVHO\UHVHPEOHVWKH7DURWWKDWWKHIRXUVXLWVRIWKHODWWHURFFXS\
LWVILUVWIRXUFROXPQVRIWKHWZHQW\RQHDWRXWVIRXUWHHQRFFXS\WKH
ILIWKFROXPQDQGWKHVHYHQRWKHUDWRXWVWKHVL[WKFROXPQ7KLVVL[WK
FROXPQRIVHYHQDWRXWVLVWKDWRIWKHVL[GD\VRIWKHZHHNRIFUHDWLRQ
1RZDFFRUGLQJWRWKH&KLQHVHWKLVUHSUHVHQWDWLRQEHORQJVWRWKHILUVW
DJHVRIWKHLUHPSLUHWRWKHGU\LQJXSRIWKHZDWHUVRIWKHGHOXJHE\
O$2LWPD\EHFRQFOXGHGWKHUHIRUHWKDWLWLVDQRULJLQDORUDFRS\RI
WKH7DURWDQGXQGHUDQ\FLUFXPVWDQFHVWKDWWKHODWWHULVRIDQRULJLQ
DQWHULRUWR0RVHVWKDWLWEHORQJVWRWKHEHJLQQLQJRIRXUWLPHWRWKH

HSRFKRIWKHSUHSDUDWLRQRIWKH=RGLDFDQGFRQVHTXHQWO\WKDWLWPXVW
RZQ\HDUVRIH[LVWHQFH
%XWQRWZLWKVWDQGLQJWKHDSSDUHQWDXGDFLW\RIWKLVODWWHUVWDWHPHQWLW
PXVWEHHYLGHQWRQUHIOHFWLRQWKDWWKH7DURWFRQVLVWLQJDVLWGRHVRI
WKHWHQQXPEHUVRIWKHGHFLPDOVFDOHFRXQWHUFKDQJHGZLWKWKHWHWUDG
DQGRIDKLHURJO\SKLFDOSKDEHWRIWZHQW\WZRP\VWLFV\PEROVPXVWEH
UHOHJDWHGWRIDUHDUOLHUSHULRGLQWKHKLVWRU\RIWKHZRUOGWKDQWKDW
XVXDOO\DVVLJQHGWRWKHLQWURGXFWLRQRIFDUGVLQWR(XURSHDQGZHPD\
WDNHWKHIDFWRIWKH7DURWEHLQJWKHRULJLQRIWKHPRGHUQFDUGDVEHLQJ
QRZSUHWW\ZHOOHVWDEOLVKHGE\JHQHUDOFRQVHQVXVRI2SLQLRQ
,WZDV&RXUWGH*qEHOLQZKRLQKLV0RQGH3ULPLWLI3DULV
ZURWH:HUHZHWRKHDUWKDWWKHUHH[LVWVLQRXUGD\:RUNRIWKH
$QFLHQW(J\SWLDQVRQHRIWKHLUERRNVZKLFKKDGHVFDSHGWKHIODPHV
ZKLFKGHYRXUHGWKHLUVXSHUEOLEUDULHVDQGZKLFKFRQWDLQVWKHLUSXUHVW
GRFWULQHRQPRVWLQWHUHVWLQJVXEMHFWVHYHU\RQHZRXOGGRXEWOHVVEH
DQ[LRXVWRDFTXLUHWKHNQRZOHGJHRIVRYDOXDEOHDQGH[WUDRUGLQDU\D
ZRUN:HUHZHWRDGGWKDWWKLVERRNLVZLGHO\VSUHDGWKURXJKDODUJH
SDUWRI(XURSHDQGWKDWIRUVHYHUDOFHQWXULHVLWKDVEHHQDFFHVVLEOHWR
HYHU\RQHZRXOGQRWLWEHVWLOOPRUHVXUSULVLQJ"$QGZRXOGQRWWKDW
VXUSULVHEHDWLWVKHLJKWZHUHLWDVVHUWHGWKDWSHRSOHKDYHQHYHU
VXVSHFWHGWKDWLWZDV(J\SWLDQWKDWWKH\SRVVHVVLWLQVXFKDPDQQHU
WKDWWKH\FDQKDUGO\EHVDLGWRSRVVHVVLWDWDOOWKDWQRRQHKDVHYHU
DWWHPSWHGWRGHFLSKHUDVLQJOHOHDIDQGWKDWWKHRXWFRPHRIDUHFRQGLWH
ZLVGRPLVUHJDUGHGDVDPDVVRIH[WUDYDJDQWGHVLJQVZKLFKPHDQ
QRWKLQJLQWKHPVHOYHV":RXOGQRWSHRSOHWKLQNWKDWRQHZDVWU\LQJWR
DPXVHRQHVHOIZLWKDQGWRSOD\XSRQWKHFUHGXOLW\RIRQHVKHDUHUV"
<HWWKLVLVDWUXHIDFW7KLV(J\SWLDQERRNWKHVROHUHPDLQVRIWKHLU
VXSHUEOLEUDULHVH[LVWVWRRXUGD\LWLVHYHQVRFRPPRQWKDWQRVDYDQW
KDVGHVLJQHGWRWURXEOHKLPVHOIDERXWLWQRRQHEHIRUHP\VHOIKDYLQJ
VXVSHFWHGLWVLOOXVWULRXVRULJLQ7KLVERRNLVFRPSRVHGRIVHYHQW\
VHYHQOHDYHVRULOOXVWUDWLRQVRUUDWKHURIVHYHQW\HLJKWGLYLGHGLQWR
ILYHFODVVHVZKLFKHDFKSUHVHQWREMHFWVDVYDULRXVDVWKH\DUHDPXVLQJ
DQGLQVWUXFWLYH,QRQHZRUGWKLVERRNLVWKH3$&.2)7$527
&$5'6
/HWXVQRZH[DPLQHWKHZRUG7$527RU7$52DQGGLVFRYHULIZH
FDQLWVWUXHGHULYDWLRQDQGPHDQLQJ&RXUWGH*qEHOLQVWDWHVWKDWWKHUH
DUHWKUHHZRUGVRI2ULHQWDORULJLQSUHVHUYHGLQWKHQRPHQFODWXUHRIWKH
3DFN7KHVHDUH7$520$7DQG3$*$'7DURKHVD\VLVSXUH
(J\SWLDQIURP7$53DWKDQG52526RU52*5R\DOWKH5R\DO
3DWKRI/LIH0$7LV2ULHQWDODQGPHDQVRYHUSRZHUHGPXUGHUHG
FUDFNEUDLQHGZKLOH3$*$'KHDGGVLVDOVR2ULHQWDOIRUP3$*
FKLHIRUPDVWHUDQG*$')RUWXQH9DLODQWVD\V7KHJUHDWGLYLQLW\
$VKWDURWK$VWDURWKLVQRRWKHUWKDQWKH,QGR7DUWDU7DQWDUDWKH
7DURWWKH=RGLDF0\GHULYDWLRQRIWKHZRUGZKLFK,KDYHQHYHU
IRXQGJLYHQE\DQ\DXWKRULVIURPWKHDQFLHQWKLHURJO\SKLFDO(J\SWLDQ
ZRUGWkUXWRUHTXLUHDQDQVZHURUWRFRQVXOWHUJRWKDWZKLFKLV

FRQVXOWHGRUIURPZKLFKDQDQVZHULVUHTXLUHG7KLVDSSHDUVWRPHWR
EHWKHFRUUHFWRULJLQRIWKHZRUGZKLOHWKHVHFRQGWLVDQ(J\SWLDQ
KLHURJO\SKLFILQDOZKLFKLVDGGHGWRGHQRWHWKHIHPLQLQHJHQGHU7KH
IROORZLQJDUHLQWHUHVWLQJPHWDWKHVHVRIWKHOHWWHUVRI7$52725$
+HEUHZ /DZ752$+HEUHZ *DWH527$/DWLQ ZKHHO
25$7/DWLQ LWVSHDNVDUJXHVRUHQWUHDWV7$25(J\SWLDQ 
7lXUWKH*RGGHVVRI'DUNQHVV$725(J\SWLDQ $WKRUWKH
(J\SWLDQ9HQXV$0U/XPOH\WHOOVPHWKDWWKHUHLVD=HQGZRUG
WDULVNPHDQLQJWRUHTXLUHDQDQVZHU
7KHUHDUH,WDOLDQ6SDQLVKDQG*HUPDQ7DURWSDFNVDQGVLQFHWKHWLPH
RI(WWHLOOD)UHQFKDOVREXWWKHVHODWWHUDUHQRWVRZHOODGDSWHGIRU
RFFXOWVWXG\RZLQJWR(WWHLOODVDWWHPSWHGFRUUHFWLRQVRIWKH
V\PEROLVP7KH,WDOLDQDUHGHFLGHGO\WKHEHVWIRUGLYLQDWLRQDQG
SUDFWLFDORFFXOWSXUSRVHVDQG,VKDOOWKHUHIRUHXVHWKHPDVWKHEDVLV
RIWKHSUHVHQWWUHDWLVH8QIRUWXQDWHO\WKHROGIDVKLRQHGVLQJOHKHDGHG
FDUGVDUHREVROHWHQRZDQGWKHRQO\RQHVPDGHDUHGRXEOHKHDGHG
ZKLFKFLUFXPVWDQFHDOWHUVWKHV\PEROLVPLQDIHZLQVWDQFHV,VKDOO
WKHUHIRUHZKHUHYHUQHFHVVDU\GHVFULEHWKHRPLWWHGSRUWLRQRIWKH
GHVLJQHQFORVLQJLWZLWKLQEUDFNHWVWRPDUNWKHVDPH
$V,EHIRUHREVHUYHGWKH7DURWSDFNFRQVLVWVRIVHYHQW\HLJKWFDUGV
QDPHO\IRXUVXLWVRIIRXUWHHQFDUGVHDFKDQGWZHQW\WZRV\PEROLF
QXPEHUHGWUXPSV7KHIRXUVXLWVDUH
,WDOLDQ
%DVWRQL

)UHQFK
%kWRQV

&RSSp

&RXSHV

6SDGp
'HQDUL

eSpHV
'HQLHUV

(QJOLVK
:DQGV6FHSWUHVRU
&OXEV
&XSV&KDOLFHVRU
*REOHWV
6ZRUGV
0RQH\&LUFOHVRU
3HQWDFOHV

$QVZHULQJWR
'LDPRQGV
+HDUWV
6SDGHV
&OXEV

(DFKVXLWFRQVLVWVRI$FH'HXFH7KUHH)RXU)LYH6L[6HYHQ(LJKW
1LQH7HQ)DQWLRU9DOHW .QDYH&DYDOOR .QLJKWRU+RUVHPDQ
'DPDRU5HLQH 4XHHQ5H .LQJ
7KH.LQJVLQHDFKLQVWDQFHZHDUDFDSRIPDLQWHQDQFHEHQHDWKWKH
FURZQWKH4XHHQVZHDUWKHFURZQRQO\7KH4XHHQRI3HQWDFOHVDQG
WKH.QDYHRI6FHSWUHVDUHWKHRQO\RQHVUHSUHVHQWHGLQSURILOH,QWKH
VXLWRI6FHSWUHVWKH.LQJEHDUVDZDQGDNLQWRWKDWUHSUHVHQWHGRQWKH
VPDOOFDUGVRIWKHVXLWZKLOHWKHRWKHUWKUHHKRQRXUVEHDUDEOXGJHRQ
VLPLODUWRWKDWZKLFKLVVKRZQIRUWKHDFH,QWKHVXLWRIFXSVWKDWRQO\
ZKLFKLVKHOGE\WKH4XHHQLVFRYHUHGWKXVVKRZLQJWKHHVVHQWLDOO\
IHPLQLQHSURSHUWLHVRIWKLVVXLWZKLOHWKHVFHSWUHKHOGE\WKH.LQJRI
WKHSUHFHGLQJVXLWVKRZVLWVPRUHPDVFXOLQHFKDUDFWHU
,IZHH[DPLQHWKHVPDOOFDUGVFDUHIXOO\ZHVKDOOEHVWUXFNDRQFHE\
WKHFRPSDUDWLYHVLPLODULWLHVRISDWWHUQRIWKH6FHSWUHVDQGWKH6ZRUGV

ZKLFKDUHRQO\GLVWLQJXLVKHGIURPHDFKRWKHUE\WKHIRUPHUEHLQJ
VWUDLJKWDQGWKHODWWHUEHLQJFXUYHG:HVKDOODOVRQRWLFHWKDWWKH
'HXFHVKDYHSHFXOLDULWLHVRIWKHLURZQZKLFKGLVWLQJXLVKWKHPIURP
WKHUHVWRIWKHVXLW7KH'HXFHRI6FHSWUHVIRUPVDFURVVZLWKWZRURVHV
DQGWZROLOLHVLQWKHRSSRVLWHDQJOHVWKH&URVVEHWZHHQWKH5RVHRI
6KDURQDQGWKH/LO\RIWKH9DOOH\7KH'HXFHRI&XSVVKRZVD
WHVVHODWHGSDYHPHQWRUFORWKZKHUHRQWKHFXSVVWDQGEHWZHHQWKHPLV
DVSHFLHVRI&DGXFHXVZKRVHVHUSHQWVDUHUHSODFHGE\/LRQKHDGHG
IROLDWLRQVZKLFKUHFDOOWKH&KQXSKLV6HUSHQWRIWKH*QRVWLFVDQG
FHUWDLQIDPLOLDUIRUPVRIWKH(OHPHQWDO6SLULWVSUDFWLFDORFFXOWLVWVZLOO
NQRZWRZKDW,DOOXGH7KH'HXFHRI6ZRUGVIRUPVDVSHFLHVRI9HVLFD
SLVFLVHQFORVLQJDP\VWLFURVHRIWKHSULPDU\FRORXUV7KH'HXFHRI
3HQWDFOHVLVERXQGWRJHWKHUE\DFRQWLQXRXVEDQGLQVXFKDPDQQHUDV
WRIRUPDILJXUHDQGUHSUHVHQWVWKHRQHDVEHLQJWKHUHIOHFWLRQRIWKH
RWKHUDVWKH8QLYHUVHLVWKDWRIWKH'LYLQH,GHD
7KHIRXU$FHVVWDQGRXWE\WKHPVHOYHVIURPWKHUHVWRIWKHSDFNHDFK
IRUPLQJDVLWZHUHWKH.H\RILWVUHVSHFWLYHVXLW7KH$FHRI6FHSWUHV
UHFDOOVWKH&OXERI+HUFXOHVLWLVVXUURXQGHGE\HLJKWGHWDFKHGOHDYHV
ZKRVHVKDSHUHFDOOVWKDWRIWKH+HEUHZ/HWWHU<RGRU,DQGLV
FURZQHGZLWKWKH6\PERORIWKH7ULDGUHSUHVHQWHGE\WKHWKUHHORSSHG
EUDQFKHVLWLVWKH6\PERORI$OPLJKW\6WUHQJWKZLWKLQWKHFXEHRIWKH
8QLYHUVHZKLFKODWWHULVVKRZQE\WKHHLJKWOHDYHVIRUHLJKWLVWKHILUVW
FXELFDOQXPEHU7KH$FHRI&XSVLVRI(J\SWLDQRULJLQZKLFKFDQEH
PRUHHDVLO\VHHQLQWKH6SDQLVK7DURW7KHILJXUHOLNHDQLQYHUWHG0
RQLWVIURQWLVDOOWKDWUHPDLQVRIWKH(J\SWLDQWZLQ6HUSHQWVZKLFK
RULJLQDOO\GHFRUDWHGLW,WUHSUHVHQWVWKH:DWHUVRI&UHDWLRQLQWKHILUVW
FKDSWHURI*HQHVLV,WLVWKH6\PERORIWKH3RZHUZKLFKUHFHLYHVDQG
PRGLILHV7KH$FHRI6ZRUGVLVD6ZRUGVXUPRXQWHGE\D&URZQIURP
ZKLFKGHSHQGRQHLWKHUVLGHDQROLYHDQGDSDOPEUDQFKV\PEROLFRI
PHUF\DQGVHYHULW\DURXQGLWDUH6L[+HEUHZ<RGVUHFDOOLQJWKH6L[
GD\VRIWKH0RVDLF&UHDWLRQ,WLVWKH6\PERORIWKDW-XVWLFHZKLFK
PDLQWDLQVWKH:RUOGLQRUGHUWKHHTXLOLEULXPRI0HUF\DQG6HYHULW\
7KH$FHRI3HQWDFOHVUHSUHVHQWV(WHUQDO6\QWKHVLVWKHJUHDWZKROHRI
WKHYLVLEOH8QLYHUVHWKH5HDOLVDWLRQRIFRXQWHUEDODQFHGSRZHU
7KHWUXPSVDUHWKHKLHURJO\SKLFV\PEROVRIWKHRFFXOWPHDQLQJVRI
WKHOHWWHUVRIWKH+HEUHZDOSKDEHW7KH\DUHQXPEHUHGIURPWR
LQFOXVLYH6HH7DEOH
1R ,WDOLDQ


)UHQFK



,O%DJDWWR
3$*$'
/D3DSHVVD

/H%DWHOHXU



*OL$PDQWL

/$PRXUHX[





/,PSHUDWULFH
/,PSHUDWRUH
,O3DSD

/D3DSHVVH

/,PSpUDWULFH
/(PSHUHXU
/H3DSH

 (QJOLVK
7KH-XJJOHURU
0DJLFLDQ
7KH+LJK3ULHVWHVVRU
)HPDOH3RSH
7KH(PSUHVV
7KH(PSHURU
7KH+LHURSKDQWRU
3RSH
7KH/RYHUV

+HEUHZ
/HWWHU
$OHSK $
%HWK

%

9DX

9

*LPHO *
'DOHWK '
+H
+






,O&DUUR
/D*LXVWL]LD
/(UHPLWD
5RWD'L)RUWXQD

/H&KDULRW
/D-XVWLFH
/(UPLWH
/D5RXHGH
)RUWXQH
 /D)RU]D
 /D)RUFH
 ,O3HQGXWR
/H3HQGX
 ,O0RUWH
/D0RUW
 /D7HPSHUDQ]D /D7HPSHUDQFH
 ,O'LDYROR
 /H'LDEOH
 /D7RUUH
/H0DLVRQ'LHX







/H6WHOOH

/D/XQD

,O6ROH 
/$QJHOR
,O0DWWR0$7
,O0RQGR

/(WRLOH
/D/XQH
/H6ROHLO
/H-XJHPHQW
/H)RX
/H0RQGH

7KH&KDULRW
-XVWLFH
7KH+HUPLW
7KH:KHHORI)RUWXQH
6WUHQJWK)RUWLWXGH
7KH+DQJHG0DQ
'HDWK
7HPSHUDQFH
7KH'HYLO
7KH/LJKWQLQJVWUXFN
7RZHU
7KH6WDU
7KH0RRQ
7KH6XQ
7KH/DVW-XGJPHQW
7KH)RROLVK0DQ
7KH8QLYHUVH

=DLQ
&KHWK
7HWK
<RG

=
&+
7
,

3H
7]DGGL
4RSK
5HVK
6KLQ
7DX

3
7]
4
5
6+
7+

.DSK
/DPHG
0HP
1XQ
6DPHFK
$\LQ

,ZLOOQRZGHVFULEHFDUHIXOO\WKHV\PEROLVPRIHDFKRIWKHVH
KLHURJO\SKLFDONH\V
7KH-XJJOHURU0DJLFLDQ%HIRUHDWDEOHFRYHUHGZLWKWKH
DSSOLDQFHVRIKLVDUWVWDQGVWKHILJXUHRIDMXJJOHURQHKDQGXSUDLVHG
KROGLQJDZDQGLQVRPHSDFNVDFXSWKHRWKHUSRLQWLQJGRZQZDUGV
+HZHDUVDFDSRIPDLQWHQDQFHOLNHWKDWRIWKHNLQJVZKRVHZLGHEULP
IRUPVDVRUWRIDXUHROHURXQGKLVKHDG+LVERG\DQGDUPVIRUPWKH
VKDSHRIWKH+HEUHZOHWWHU$OHSKWRZKLFKWKLVFDUGFRUUHVSRQGV+H
V\PEROLVHV:LOO
7KH+LJK3ULHVWHVVRU)HPDOH3RSH$ZRPDQFURZQHGZLWKD
KLJKPLWUHRUWLDUDKHUKHDGHQFLUFOHGE\DYHLODVWROHRUDVRODU
FURVVXSRQKHUEUHDVWDQGWKH%RRNRI6FLHQFHRSHQLQKHUKDQG6KH
UHSUHVHQWV6FLHQFH:LVGRPRU.QRZOHGJH
7KH(PSUHVV$ZLQJHGDQGFURZQHGZRPDQVHDWHGXSRQDWKURQH
KDYLQJLQRQHKDQGDVFHSWUHEHDULQJDJOREHVXUPRXQWHGE\DFURVV
ZKLOHVKHUHVWVWKHRWKHUXSRQDVKLHOGZLWKDQHDJOHEOD]RQHGWKHUHLQ
RQZKRVHEUHDVWLVWKHFURVV6KHLVWKH6\PERORI$FWLRQWKHUHVXOWRI
WKHXQLRQRI6FLHQFHDQG:LOO
7KH(PSHURU+HLVFURZQHGDQGOHDQLQJDJDLQVWDWKURQHKLVOHJV
IRUPDFURVVDQGEHVLGHKLPEHQHDWKKLVOHIWKDQGLVDVKLHOG
EOD]RQHGZLWKDQHDJOH,QKLVULJKWKDQGKHEHDUVDVFHSWUHVLPLODUWR
WKDWRIWKH(PSUHVV+LVERG\DQGDUPVIRUPDWULDQJOHRIZKLFKKLV
KHDGLVWKHDSH[VRWKDWWKHZKROHILJXUHUHSUHVHQWVDWULDQJOHDERYHD
FURVV+HUHSUHVHQWV5HDOLVDWLRQ
7KH+LHURSKDQWRU3RSH+HLVFURZQHGZLWKWKHSDSDOWLDUDDQG
VHDWHGEHWZHHQWKHWZRSLOODUVRI+HUPHVDQGRI6RORPRQZLWKKLV
ULJKWKDQGKHPDNHVWKHVLJQRIHVRWHULVPDQGZLWKKLVOHIWKHOHDQV

.
/
0
1
6
2

XSRQDVWDIIVXUPRXQWHGE\DWULSOHFURVV%HIRUHKLPNQHHOWZR
PLQLVWHUV+HLVWKHV\PERORI0HUF\DQG%HQHILFHQFH
7KH/RYHUV7KLVLVXVXDOO\GHVFULEHGDVUHSUHVHQWLQJ0DQEHWZHHQ
9LFHDQG9LUWXHZKLOHDZLQJHGJHQLXVWKUHDWHQV9LFHZLWKKLVGDUW
%XW,DPUDWKHULQFOLQHGWRWKHRSLQLRQWKDWLWUHSUHVHQWVWKH
4DEDOLVWLFDO0LFURSURVRSXVEHWZHHQ%LQDKDQG0DONXWKVHHP\
.DEEDODK8QYHLOHGZKLOHWKHILJXUHDERYHVKRZVWKH,QIOXHQFH
GHVFHQGLQJIURP.HWKHU,WLVXVXDOO\FRQVLGHUHGWRPHDQ3URRIRU
7ULDOEXW,DPLQFOLQHGWRVXJJHVW:LVH'LVSRVLWLRQDVLWVVLJQLILFDWLRQ
7KH&KDULRW7KLVLVDPRVWFRPSOLFDWHGDQGLPSRUWDQWV\PERO
ZKLFKKDVEHHQUHVWRUHGE\(OLSKDV/HYL,WUHSUHVHQWVD&RQTXHURU
FURZQHGDQGEHDULQJDVFHSWUHULGLQJLQDFXELFDOFKDULRWVXUPRXQWHG
E\IRXUFROXPQVDQGDFDQRS\DQGGUDZQE\WZRKRUVHVRQHRIZKLFK
ORRNVVWUDLJKWIRUZDUGZKLOHWKHRWKHUWXUQVKLVKHDGWRZDUGVKLP
7ZRZKHHOVDUHVKRZQLQWKHFRPSOHWHVLQJOHKHDGHGILJXUH,W
UHSUHVHQWV7ULXPSKDULG9LFWRU\RI-XVWLFHDQG-XGJPHQW
-XVWLFH$ZRPDQFURZQHGDQGVHDWHGRQDWKURQHEHWZHHQWZR
FROXPQVKROGLQJLQKHUULJKWKDQGDQXSULJKWVZRUGDQGLQKHUOHIW
WKHVFDOHV6KHV\PEROLVHV(TXLOLEULXPDQG-XVWLFH
7KH+HUPLW$QROGDQGEHDUGHGPDQZUDSSHGLQDPDQWOHDQGZLWK
KLVKHDGFRYHUHGZLWKDFRZOEHDULQJLQKLVULJKWKDQGWKHODQWHUQRI
RFFXOWVFLHQFHZKLOHLQKLVOHIWKHKROGVKLVPDJLFZDQGKDOIKLGGHQ
EHQHDWKKLVFORDN+HLV3UXGHQFH
7KH:KHHORI)RUWXQH$ZKHHORIVHYHQVSRNHVWKHWZRKDOYHVRI
WKHGRXEOHKHDGHGFDUGVPDNHLWHLJKWVSRNHVZKLFKLVLQFRUUHFW
UHYROYLQJEHWZHHQWZRXSULJKWV2QWKHDVFHQGLQJVLGHLVDQDQLPDO
DVFHQGLQJDQGRQWKHGHVFHQGLQJVLGHLVDVRUWRIPRQNH\GHVFHQGLQJ
ERWKIRUPVDUHERXQGWRWKHZKHHO$ERYHLWLVWKHIRUPRIDQDQJHORU
DVSKLQ[LQVRPHKROGLQJDVZRUGLQRQHKDQGDQGDFURZQLQWKH
RWKHU7KLVYHU\FRPSOLFDWHGV\PEROLVPXFKGLVILJXUHGDQGKDVEHHQ
ZHOOUHVWRUHGE\/HYL,WV\PEROLVHV)RUWXQHJRRGRUEDG
6WUHQJWKRU)RUWLWXGH$ZRPDQFURZQHGZLWKFURZQDQGFDSRI
PDLQWHQDQFHZKRFDOPO\DQG:LWKRXWHIIRUWFORVHVWKHMDZVRID
IXULRXVOLRQ6KHUHSUHVHQWV6WUHQJWK
7KH+DQJHG0DQ7KLVH[WUDRUGLQDU\V\PEROLVDOPRVW
XQLQWHOOLJLEOHLQWKHGRXEOHKHDGHGFDUGV3URSHUO\LWUHSUHVHQWVDPDQ
KXQJKHDGGRZQZDUGVIURPDVRUWRIJLEEHWE\RQHIRRWKLVKDQGVDUH
ERXQGEHKLQGKLVEDFNLQVXFKDPDQQHUWKDWKLVERG\IRUPVDWULDQJOH
ZLWKWKHSRLQWGRZQZDUGVDQGKLVOHJVDFURVVDERYHLW7ZRVDFNVRU
ZHLJKWVDUHDWWDFKHGWRKLVDUPSLWV+HV\PEROLVHV6DFULILFH

'HDWK$VNHOHWRQDUPHGZLWKD6F\WKHZKHUHZLWKKHPRZVGRZQ
KHDGVLQDPHDGRZOLNHJUDVV+HVLJQLILHV7UDQVIRUPDWLRQRU
&KDQJH
7HPSHUDQFH$QDQJHOZLWKWKHVLJQRIWKH6XQRQKHUEURZ
3RXULQJOLTXLGIURPRQHYHVVHOLQWRDQRWKHU6KHUHSUHVHQWV
&RPELQDWLRQ
7KH'HYLO$KRUQHGDQGZLQJHGGHPRQZLWKHDJOHVFODZV
VWDQGLQJRQDQDOWDUWRZKLFKWZRVPDOOHUGHYLOVDUHERXQGE\DFROODU
DQGFRUG,QKLVOHIWKDQGKHEHDUVDIODPHKHDGHGVFHSWUH+HLVWKH
LPDJHRI)DWHRU)DWDOLW\JRRGRUHYLO
7KH/LJKWQLQJVWUXFN7RZHU$7RZHUZKRVH8SSHUSDUWLVOLNHD
FURZQVWUXFNE\DOLJKWQLQJIODVK7ZRPHQIDOOKHDGORQJIURPLW
2QHRIZKRPLVLQVXFKDQDWWLWXGHDVWRIRUPD+HEUHZOHWWHU$\LQ
6SDUNVDQGGHEULVDUHIDOOLQJ,WVKRZV5XLQ'LVUXSWLRQ
7KH6WDU$QXGHIHPDOHILJXUHSRXUVZDWHUXSRQWKHHDUWKIURP
WZRYDVHV,QWKHKHDYHQVDERYHKHUVKLQHVWKH%OD]LQJ6WDURIWKH
0DJLVXUURXQGHGE\VHYHQRWKHUVWUHHVDQGSODQWVJURZEHQHDWKKHU
PDJLFLQIOXHQFHDQGRQRQHWKHEXWWHUIO\RI3V\FKHDOLJKWV6KHLVWKH
VWDURI+RSH
7KH0RRQ7KHPRRQVKLQLQJLQWKHKHDYHQVGURSVRIGHZIDOOLQJ
DZROIDQGDGRJKRZOLQJDWWKH0RRQDQGKDOWHGDWWKHIRRWRIWZR
WRZHUVDSDWKZKLFKORVHVLWVHOILQWKHKRUL]RQDQGLVVSULQNOHGZLWK
GURSVRIEORRGDFUD\ILVKHPEOHPDWLFRIWKHVLJQ&DQFHUUXOHGRYHUE\
WKH0RRQFUDZOVWKURXJKZDWHULQWKHIRUHJURXQGWRZDUGVWKHODQG,W
V\PEROLVHV7ZLOLJKW'HFHSWLRQDQG(UURU
7KH6XQ7KH6XQVHQGLQJGRZQKLVUD\VXSRQWZRFKLOGUHQZKR
VXJJHVWWKHVLJQ*HPLQL%HKLQGWKHPLVDORZZDOO,WVLJQLILHV
(DUWKO\+DSSLQHVV
7KH/DVW-XGJPHQW$Q$QJHOLQWKHKHDYHQVEORZLQJDWUXPSHW
WRZKLFKDVWDQGDUGZLWKDFURVVWKHUHRQLVDWWDFKHG7KH'HDGULVH
IURPWKHLUWRPEV,WVLJQLILHV5HQHZDO5HVXOW
7KH)RROLVK0DQ$PDQZLWKDIRROVFDSGUHVVHGOLNHDMHVWHU
ZLWKDVWLFNDQGEXQGOHRYHUKLVVKRXOGHU%HIRUHKLPLVWKHEXWWHUIO\RI
SOHDVXUHOXULQJKLPRQZKLOHLQVRPHSDFNVDWLJHULQRWKHUVDGRJ
DWWDFNVKLPIURPEHKLQG,WVLJQLILHV)ROO\([SLDWLRQ
7KH8QLYHUVH:LWKLQDIORZHU\ZUHDWKLVDIHPDOHILJXUHQXGH
VDYHIRUDOLJKWVFDUI6KHUHSUHVHQWV1DWXUHDQGWKH'LYLQH3UHVHQFH
WKHUHLQ,QHDFKKDQGVKHVKRXOGEHDUDZDQG$WWKHIRXUDQJOHVRIWKH
FDUGDUHWKHIRXUFKHUXELFDQLPDOVRIWKH$SRFDO\SVH$ERYHWKH(DJOH
DQGWKH0DQEHORZWKH/LRQDQGWKH%XOO,WUHSUHVHQWV&RPSOHWLRQ
5HZDUG

7KXVWKHZKROHVHULHVRIWKHWZHQW\WZRWUXPSVZLOOJLYHDFRQQHFWHG
VHQWHQFHZKLFKLVFDSDEOHRIEHLQJUHDGWKXV7KH+XPDQ:LOO
HQOLJKWHQHGE\6FLHQFHDQGPDQLIHVWHGE\
$FWLRQVKRXOGILQGLWV5HDOLVDWLRQLQGHHGVRI0HUF\DQG
%HQHILFHQFH7KH:LVH'LVSRVLWLRQRIWKLVZLOOJLYHKLP9LFWRU\
WKURXJK(TXLOLEULXPDQG3UXGHQFHRYHUWKHIOXFWXDWLRQVRI
)RUWXQH)RUWLWXGHVDQFWLILHGE\6DFULILFHRI6HOIZLOO
WULXPSKRYHU'HDWKLWVHOIDQGWKXVD:LVH&RPELQDWLRQZLOO
HQDEOHKLPWRGHI\)DWH,QHDFK0LVIRUWXQHKHZLOOVHHWKH
6WDURI+RSHVKLQHWKURXJKWKHWZLOLJKWRI'HFHSWLRQDQG
XOWLPDWH+DSSLQHVVZLOOEHWKH5HVXOW)ROO\RQWKHRWKHU
KDQGZLOOEULQJDERXWDQHYLO5HZDUG
7RSUHSDUHWKHSDFNIRU)RUWXQHWHOOLQJZULWHDWWKHWRSRIHDFKFDUGLWV
QXPEHUDQGVLJQLILFDWLRQZKHQLQLWVSURSHUSRVLWLRQDQGDWWKHERWWRP
LWVPHDQLQJZKHQUHYHUVHG7RIDFLOLWDWHWKLVDQGWRDVVLVWLQUHDGLQJ
WKHP,KHUHDSSHQGDOLVWRIWKHFDUGVZLWKWKHPHDQLQJVZKLFK,
WKLQNZLOOEHIRXQGWRDQVZHUDOOSUDFWLFDOSXUSRVHV5PHDQV
5HYHUVHG
0($1,1*62)7+(&$5'6
7KH-XJJOHU:LOO:LOO3RZHU'H[WHULW\5:LOODSSOLHGWRHYLO
HQGV:HDNQHVVRI:LOO&XQQLQJ.QDYLVKQHVV
7KH+LJK3ULHVWHVV6FLHQFH:LVGRP.QRZOHGJH(GXFDWLRQ5
&RQFHLW,JQRUDQFH8QVNLOIXOQHVV6XSHUILFLDO.QRZOHGJH
7KH(PSUHVV$FWLRQ3ODQ8QGHUWDNLQJ0RYHPHQWLQDPDWWHU
,QLWLDWLYH5,QDFWLRQ)ULWWHULQJDZD\RISRZHU:DQWRI
&RQFHQWUDWLRQ9DFLOODWLRQ
7KH(PSHURU5HDOLVDWLRQ(IIHFW'HYHORSPHQW56WRSSDJH
&KHFN,PPDWXUH8QULSH
7KH+LHURSKDQWRU3RSH0HUF\%HQHILFHQFH.LQGQHVV*RRGQHVV
52YHUNLQGQHVVZHDNQHVV)RROLVKH[HUFLVHRIJHQHURVLW\
7KH/RYHUV:LVH'LVSRVLWLRQV3URRI7ULDOV6XUPRXQWHG5
8QZLVH3ODQV)DLOXUHZKHQSXWWRWKHWHVW
7KH&KDULRW7ULXPSK9LFWRU\2YHUFRPLQJREVWDFOHV5
2YHUWKURZQ&RQTXHUHGE\2EVWDFOHVDWWKHODVWPRPHQW
7KHPLVRU-XVWLFH(TXLOLEULXP%DODQFH-XVWLFH5%LJRWU\:DQW
RI%DODQFH$EXVHRI-XVWLFH2YHUVHYHULW\,QHTXDOLW\%LDV
7KH+HUPLW3UXGHQFH&DXWLRQ'HOLEHUDWLRQ52YHUSUXGHQFH
7LPRURXVQHVV)HDU

7KH:KHHORI)RUWXQH*RRG)RUWXQH6XFFHVV8QH[SHFWHG
/XFN5,OO)RUWXQH)DLOXUH8QH[SHFWHG,OO/XFN
6WUHQJWKRU)RUWLWXGH3RZHU0LJKW)RUFH6WUHQJWK)RUWLWXGH
5$EXVHRI3RZHU2YHUEHDULQJQHVV:DQWRI)RUWLWXGH
7KH+DQJHG0DQ6HOIVDFULILFH6DFULILFH'HYRWLRQ%RXQG5
6HOILVKQHVV8QERXQG3DUWLDOVDFULILFH
'HDWK'HDWK&KDQJH7UDQVIRUPDWLRQ$OWHUDWLRQIRUWKHZRUVH
5'HDWKMXVWHVFDSHG3DUWLDOFKDQJH$OWHUDWLRQIRUWKHEHWWHU
7HPSHUDQFH&RPELQDWLRQ&RQIRUPDWLRQ8QLWLQJ5,OO
DGYLVHGFRPELQDWLRQV'LVXQLRQ&ODVKLQJLQWHUHVWV F
7KH'HYLO)DWDOLW\IRU*RRG5)DWDOLW\IRU(YLO
7KH/LJKWQLQJVWUXFN7RZHU5XLQ'LVUXSWLRQ2YHUWKURZ/RVV
%DQNUXSWF\57KHVHLQDPRUHRUOHVVSDUWLDOGHJUHH
7KH6WDU+RSH([SHFWDWLRQ%ULJKWSURPLVHV5+RSHVQRW
IXOILOOHG([SHFWDWLRQVGLVDSSRLQWHGRUIXOILOOHGLQDPLQRUGHJUHH
7KH0RRQ7ZLOLJKW'HFHSWLRQ(UURU5)OXFWXDWLRQVOLJKW
'HFHSWLRQV7ULIOLQJ0LVWDNHV
7KH6XQ+DSSLQHVV&RQWHQW-R\57KHVHLQDPLQRUGHJUHH
7KH/DVW-XGJPHQW5HQHZDO5HVXOW'HWHUPLQDWLRQRID
0DWWHU53RVWSRQHPHQWRI5HVXOW'HOD\0DWWHUUHRSHQHGODWHU
7KH)RROLVK0DQ)ROO\([SLDWLRQ:DYHULQJ5+HVLWDWLRQ
,QVWDELOLW\7URXEOHDULVLQJKHUHIURP
7KH8QLYHUVH&RPSOHWLRQ*RRG5HZDUG5(YLO5HZDUGRU
5HFRPSHQVH
.LQJRI6FHSWUHV0DQOLYLQJLQWKHFRXQWU\&RXQWU\*HQWOHPDQ
.QRZOHGJH(GXFDWLRQ5$QDWXUDOO\JRRGEXWVHYHUHPDQ&RXQVHO
$GYLFH'HOLEHUDWLRQ
4XHHQRI6FHSWUHV:RPDQOLYLQJLQWKHFRXQWU\/DG\RIWKH
0DQRU/RYHRI0RQH\$YDULFH8VXU\5$JRRGDYLUWXRXV:RPDQ
EXWVWULFWDQGHFRQRPLFDO2EVWDFOHV5HVLVWDQFH2SSRVLWLRQ
.QLJKWRI6FHSWUHV'HSDUWXUH6HSDUDWLRQ'LVXQLRQ5
5XSWXUH'LVFRUG4XDUUHO
.QDYHRI6FHSWUHV$*RRG6WUDQJHU*RRG1HZV3OHDVXUH
6DWLVIDFWLRQ5,OO1HZV'LVSOHDVXUH&KDJULQ:RUU\

7HQRI6FHSWUHV&RQILGHQFH6HFXULW\+RQRXU*RRG)DLWK5
7UHDFKHU\6XEWHUIXJH'XSOLFLW\%DU
1LQHRI6FHSWUHV2UGHU'LVFLSOLQH*RRG$UUDQJHPHQW
'LVSRVLWLRQ52EVWDFOHV&URVVHV'HOD\'LVSOHDVXUH
(LJKWRI6FHSWUHV8QGHUVWDQGLQJ2EVHUYDWLRQ'LUHFWLRQ5
4XDUUHOV,QWHVWLQHGLVSXWHV'LVFRUG
6HYHQRI6FHSWUHV6XFFHVV*DLQ$GYDQWDJH3URILW9LFWRU\5
,QGHFLVLRQ'RXEW+HVLWDWLRQ(PEDUUDVVPHQW$Q[LHW\
6L[RI6FHSWUHV$WWHPSW+RSH'HVLUH:LVK([SHFWDWLRQ5
,QILGHOLW\7UHDFKHU\'LVOR\DOW\3HUILG\
)LYHRI6FHSWUHV*ROG2SXOHQFH*DLQ+HULWDJH5LFKHV
)RUWXQH0RQH\5/HJDOSURFHHGLQJV-XGJPHQW/DZ/DZ\HU
7ULEXQDO
)RXURI6FHSWUHV6RFLHW\8QLRQ$VVRFLDWLRQ&RQFRUG
+DUPRQ\53URVSHULW\6XFFHVV+DSSLQHVV$GYDQWDJH
7KUHHRI6FHSWUHV(QWHUSULVH8QGHUWDNLQJ&RPPHUFH7UDGH
1HJRWLDWLRQ5+RSH'HVLUH$WWHPSW:LVK
'HXFHRI6FHSWUHV5LFKHV)RUWXQH2SXOHQFH0DJQLILFHQFH
*UDQGHXU56XUSULVH$VWRQLVKPHQW(YHQW([WUDRUGLQDU\
2FFXUUHQFH
$FHRI6FHSWUHV%LUWK&RPPHQFHPHQW%HJLQQLQJ2ULJLQ
6RXUFH53HUVHFXWLRQ3XUVXLWV9RLOHQFH9H[DWLRQ&UXHOW\7\UDQQ\
.LQJRI&XSV$IDLU0DQ*RRGQHVV.LQGQHVV/LEHUDOLW\
*HQHURVLW\5$0DQRIJRRGSRVLWLRQEXWVKLIW\LQKLV'HDOLQJV
'LVWUXVW'RXEW6XVSLFLRQ
4XHHQRI&XSV$IDLU:RPDQ6XFFHVV+DSSLQHVV$GYDQWDJH
3OHDVXUH5$:RPDQLQJRRGSRVLWLRQEXWLQWHUPHGGOLQJDQGWREH
GLVWUXVWHG6XFFHVVEXWZLWKVRPHDWWHQGDQWWURXEOH
.QLJKWRI&XSV$UULYDO$SSURDFK$GYDQFH5'XSOLFLW\
$EXVHRI&RQILGHQFH)UDXG&XQQLQJ
.QDYHRI&XSV$IDLU<RXWK&RQILGHQFH3URELW\'LVFUHWLRQ
,QWHJULW\5$)ODWWHUHU'HFHSWLRQ$UWLILFH
7HQRI&XSV7KH7RZQZKHUHLQRQHUHVLGHV+RQRXU
&RQVLGHUDWLRQ(VWHHP9LUWXH*ORU\5HSXWDWLRQ5&RPEDW6WULIH
2SSRVLWLRQ'LIIHUHQFHV'LVSXWH

1LQHRI&XSV9LFWRU\$GYDQWDJH6XFFHVV7ULXPSK
'LIILFXOWLHVVXUPRXQWHG5)DXOWV(UURUV0LVWDNHV,PSHUIHFWLRQV
(LJKWRI&XSV$IDLU*LUO)ULHQGVKLS$WWDFKPHQW7HQGHUQHVV
5*DLHW\)HDVWLQJ-R\3OHDVXUH
6HYHQRI&XSV,GHD6HQWLPHQW5HIOHFWLRQ3URMHFW53ODQ
'HVLJQ5HVROXWLRQ'HFLVLRQ
6L[RI&XSV7KH3DVWSDVVHGE\)DGHG9DQLVKHG'LVDSSHDUHG
57KH)XWXUHWKDWZKLFKLVWRFRPH6KRUWO\6RRQ
)LYHRI&XSV8QLRQ-XQFWLRQ0DUULDJH,QKHULWDQFH5$UULYDO
5HWXUQ1HZV6XUSULVH)DOVHSURMHFWV
)RXURI&XSV(QQXL'LVSOHDVXUH'LVFRQWHQW'LVVDWLVIDFWLRQ
51HZ$FTXDLQWDQFH&RQMHFWXUH6LJQ3UHVHQWLPHQW
7KUHHRI&XSV6XFFHVV7ULXPSK9LFWRU\)DYRXUDEOHLVVXH5
([SHGLWLRQRIEXVLQHVV4XLFNQHVV&HOHULW\9LJLODQFH
'HXFHRI&XSV/RYH$WWDFKPHQW)ULHQGVKLS6LQFHULW\
$IIHFWLRQ5&URVVHGGHVLUHV2EVWDFOHV2SSRVLWLRQ+LQGUDQFH
$FHRI&XSV)HDVWLQJ%DQTXHW*RRG&KHHU5&KDQJH
1RYHOW\0HWDPRUSKRVLV,QFRQVWDQF\
.LQJRI6ZRUGV$/DZ\HUD0DQRI/DZ3RZHU&RPPDQG
6XSHULRULW\$XWKRULW\5$:LFNHG0DQ&KDJULQ:RUU\*ULHI
)HDU'LVWXUEDQFH
4XHHQRI6ZRUGV:LGRZKRRG/RVV3ULYDWLRQ$EVHQFH
6HSDUDWLRQ5$%DG:RPDQLOOWHPSHUHGDQGELJRWHG5LFKHVDQG
'LVFRUG$EXQGDQFHWRJHWKHUZLWK:RUU\-R\ZLWK*ULHI
.QLJKWRI6ZRUGV$6ROGLHUDPDQZKRVHSURIHVVLRQLVDUPV
6NLOIXOQHVV&DSDFLW\$GGUHVV3URPSWLWXGH5$FRQFHLWHGIRRO
,QJHQXRXVQHVV6LPSOLFLW\
.QDYHRI6ZRUGV$6S\2YHUORRNLQJ$XWKRULW\57KDWZKLFK
LVXQIRUHVHHQ9LJLODQFH6XSSRUW
7HQRI6ZRUGV7HDUV$IIOLFWLRQ*ULHI6RUURZ53DVVLQJ
6XFFHVV0RPHQWDU\$GYDQWDJH
1LQHRI6ZRUGV$Q(FFOHVLDVWLFD3ULHVW&RQVFLHQFH3URELW\
*RRG)DLWK,QWHJULW\5:LVHGLVWUXVW6XVSLFLRQ)HDU'RXEW6KDG\
FKDUDFWHU

(LJKWRI6ZRUGV6LFNQHVV&DOXPQ\&ULWLFLVP%ODPH5

7UHDFKHU\LQWKH3DVW(YHQW$FFLGHQW5HPDUNDEOH,QFLGHQW
6HYHQRI6ZRUGV+RSH&RQILGHQFH'HVLUH$WWHPSW:LVK5
:LVH$GYLFH*RRG&RXQVHO:LVGRP3UXGHQFH&LUFXPVSHFWLRQ
6L[RI6ZRUGV(QYR\0HVVHQJHU9R\DJH7UDYHO5
'HFODUDWLRQ/RYHSURSRVHG5HYHODWLRQ6XUSULVH
)LYHRI6ZRUGV0RXUQLQJ6DGQHVV$IIOLFWLRQ5/RVVHV
7URXEOHVDPHVLJQLILFDWLRQZKHWKHUUHYHUVHGRUQRW
)RXURI6ZRUGV6ROLWXGH5HWUHDW$EDQGRQPHQW6ROLWDU\
+HUPLW5(FRQRP\3UHFDXWLRQ5HJXODWLRQRI([SHQGLWXUH
7KUHHRI6ZRUGV$1XQ6HSDUDWLRQ5HPRYDO5XSWXUH
4XDUUHO5(UURU&RQIXVLRQ0LVUXOH'LVRUGHU
'HXFHRI6ZRUGV)ULHQGVKLS9DORXU)LUPQHVV&RXUDJH5
)DOVH)ULHQGV7UHDFKHU\/LHV
$FHRI6ZRUGV7ULXPSK)HFXQGLW\)HUWLOLW\3URVSHULW\5
(PEDUUDVVPHQW)RROLVKDQG+RSHOHVV/RYH2EVWDFOH+LQGUDQFH
.LQJRI3HQWDFOHV$GDUN0DQ9LFWRU\%UDYHU\&RXUDJH
6XFFHVV5$QROGDQGYLFLRXV0DQD'DQJHURXV0DQ'RXEW)HDU
3HULO'DQJHU
4XHHQRI3HQWDFOHV$GDUN:RPDQDJHQHURXV:RPDQ
/LEHUDOLW\*UHDWQHVVRI6RXO*HQHURVLW\5&HUWDLQ(YLODVXVSLFLRXV
:RPDQD:RPDQMXVWO\UHJDUGHGZLWK6XVSLFLRQ'RXEW0LVWUXVW
.QLJKWRI3HQWDFOHV$XVHIXO0DQ7UXVWZRUWK\:LVGRP
(FRQRP\2UGHU5HJXODWLRQ5$EUDYH0DQEXWRXWRI(PSOR\PHQW
,GOH8QHPSOR\HG1HJOLJHQW
.QDYHRI3HQWDFOHV$GDUN<RXWK(FRQRP\2UGHU5XOH
0DQDJHPHQW53URGLJDOLW\3URIXVLRQ:DVWH'LVVLSDWLRQ
7HQRI3HQWDFOHV+RXVH'ZHOOLQJ+DELWDWLRQ)DPLO\5
*DPEOLQJ'LVVLSDWLRQ5REEHU\/RVV
1LQHRI3HQWDFOHV'LVFUHWLRQ&LUFXPVSHFWLRQ3UXGHQFH
'LVFHUQPHQW5'HFHLW%DGIDLWK$UWLILFHV'HFHSWLRQ
(LJKWRI3HQWDFOHV$GDUN*LUO%HDXW\&DQGRXU&KDVWLW\
,QQRFHQFH0RGHVW\5)ODWWHU\8VXU\+\SRFULV\6KLIW\
6HYHQRI3HQWDFOHV0RQH\)LQDQFH7UHDVXUH*DLQ3URILW5
'LVWXUEDQFH:RUU\$Q[LHW\0HODQFKRO\

6L[RI3HQWDFOHV3UHVHQWV*LIWV*UDWLILFDWLRQ5$PELWLRQ
'HVLUH3DVVLRQ$LP/RQJLQJ
)LYHRI3HQWDFOHV/RYHURU0LVWUHVV/RYH6ZHHWQHVV
$IIHFWLRQ3XUHDQG&KDVWH/RYH5'LVJUDFHIXO/RYH,PSUXGHQFH
/LFHQVH3URIOLJDF\
)RXURI3HQWDFOHV3OHDVXUH*DLHW\(QMR\PHQW6DWLVIDFWLRQ5
2EVWDFOHV+LQGUDQFHV
7KUHHRI3HQWDFOHV1RELOLW\(OHYDWLRQ'LJQLW\5DQN3RZHU
5&KLOGUHQ6RQV'DXJKWHUV<RXWKV&RPPHQFHPHQW
'HXFHRI3HQWDFOHV(PEDUUDVVPHQW:RUU\'LIILFXOWLHV5
/HWWHU0LVVLYH(SLVWOH0HVVDJH
$FHRI3HQWDFOHV3HUIHFW&RQWHQWPHQW)HOLFLW\3URVSHULW\
7ULXPSK53XUVHRI*ROG0RQH\*DLQ+HOS3URILW5LFKHV
7KHIROORZLQJDGGLWLRQDOUHPDUNVPD\EHVHUYLFHDEOHWRWKHWRWKH
LQH[SHULHQFHG&DUWRPDQFHU7KH\DUHFKLHIO\WDNHQIURP(WWHLOOD
.QLJKWRI6FHSWUHV7KLVFDUGLVQRWWREHUHDGVLQJO\LWPHDQV
WKH'HSDUWXUHRIWKHFDUGZKLFKIROORZVLW5$JDLQQRWLFHWKHFDUG
ZKLFKIROORZVLWLID:RPDQ4XDUUHOZLWKD:RPDQLI0RQH\WKHQ
/RVVRI0RQH\ F
.QDYHRI6FHSWUHV51RWLFHEHWZHHQZKDWFDUGVWKH1HZVIDOOV
ZKLFKZLOOVKRZZKHQFHLWFRPHVDQGRIZKDWQDWXUHLWLV
'HXFHRI6FHSWUHV5,IWKHFDUGVIDOO55\RXZLOOEH
VXUSULVHGE\DFKDQJH,I55LWZLOOEHKDSS\EXWWKH
UHYHUVHLIWKH\IDOO55
7KH.QLJKWRI&XSV7KLVVKRZVWKHDUULYDORIWKHFDUGZKLFK
IROORZVLWDVWKHDUULYDORIDIIOLFWLRQRUJULHIWKHYLVLWRI
DIDLU\RXQJPDQHWF
6HYHQRI&XSV([SODLQVWKHFDUGZKLFKIROORZVWKXV
7KHLGHDRIDWWHPSWLQJVRPHXQGHUWDNLQJ7KLVZLOODJDLQEH
PRGLILHGE\WKHIROORZLQJFDUGV
6L[RI&XSV6KRZVHLWKHUWKDWZKDWSUHFHGHVLWLVSDVWKDV
RFFXUUHGDOUHDG\RULI5ZKDWLVJRLQJWRKDSSHQ
)RXURI&XSV7KHIROORZLQJFDUGVPLJKWVKRZZKDWWKH
GLVSOHDVXUHRUDQ[LHW\ZDVDERXWWKHSUHFHGLQJFDUGVZKHQFHLW
RULJLQDWHG

4XHHQRI6ZRUGV7KLVLVQRWQHFHVVDULO\WREHWDNHQE\LWVHOILW
PD\VLJQLI\WKDWWKHSHUVRQV\PEROLVHGE\WKHFDUGVQHDULWKDVMXVW
ORVWRULVOLNHO\VRRQWRORVHZLIHRUKXVEDQG,QVRPHLQVWDQFHVLWPD\
PHUHO\VLJQLI\WKDWLIWZRSHRSOHDUHPDUULHGWKHRQHZLOOGLHVRPH
WLPHEHIRUHWKHRWKHUEXWQRWQHFHVVDULO\WKDWWKHHYHQWZLOORFFXU
LPPHGLDWHO\
.QDYHRI6ZRUGV5,I5$QXQH[SHFWHGSUHVHQW,I
5XQH[SHFWHGJULHIHWF
1LQHRI6ZRUGV57KHFDUGIROORZLQJZLOOVKRZZKRPRUZKDW
WRGLVWUXVW F
(LJKWRI6ZRUGV56KRZV7UHDFKHU\RU'HFHLWLQWKHSDVWDQG
ZLOOEHH[SODLQHGE\WKHQHLJKERXULQJFDUGV
6HYHQRI6ZRUGV57KHFDUGVZKLFKFRPHQH[WZLOOVKRZ
ZKHWKHULWZLOOEHJRRGWRIROORZWKHDGYLFHJLYHQRUQRW$OVRWKH
SUHFHGLQJFDUGVZLOOVKRZIURPZKRPDQGZK\WKHDGYLFHFRPHV
)RXURI6ZRUGV57KHFDUGVQHDUZLOOVKRZZKHWKHULWLVKHDOWK
RUPRQH\WKDWUHTXLUHVFDUH
7KUHHRI6ZRUGV50D\VKRZVLPSO\WKDWVRPHWKLQJLVORVWRU
PLVODLGIRUDWLPH
'HXFHRI6ZRUGV5,IFRQILUPHGE\WKHRWKHUFDUGVPD\VLPSO\
PHDQWKDWWKHIULHQGVDUHQRWRIPXFKXVHWRWKHLQTXLUHULQWKHPDWWHU
XQGHUFRQVLGHUDWLRQ
4XHHQRI3HQWDFOHV5,IWKLVFDUGGRHVQRWVLJQLI\DQ\
SDUWLFXODUSHUVRQ,I55,WLVQRWVDLGWKDWWKHUHZLOOEHD
/DZVXLW,I55,I\RXJDLQ\RXUFDVH\RXZRQWEHPXFKWKH
EHWWHUIRULW
.QDYHRI3HQWDFOHV5&RQVXOWWKHIROORZLQJFDUGVWRVHHLQ
ZKDWWKHSHUVRQLVSURGLJDO,I55LWPD\VLPSO\PHDQWKDW
WKHSHUVRQLVWRRIRQGRIJLYLQJDGYLFHLQWHUPHGGOHVWRRPXFKZLWK
RWKHUSHRSOHVEXVLQHVV
6HYHQRI3HQWDFOHV57KHQH[WFDUGZLOOVKRZWKHUHDVRQRIWKH
DQ[LHW\DQGVRRQ
)LYHRI3HQWDFOHV6KRZVVLPSO\WKDWWKHUHLVVRPHRQHZKRP
WKHSHUVRQORYHV
7KH&RXUW&DUGVDQGHVSHFLDOO\WKH.LQJVDQG4XHHQVPD\EHWDNHQ
WRUHSUHVHQWSHUVRQVLQWKLVFDVHWKHLUDGGLWLRQDOPHDQLQJVKRXOGQRW
EHUHDG7KH6ZRUGVUHSUHVHQWYHU\GDUNSHRSOH3HQWDFOHVWKRVHQRW
VRGDUN&XSVUDWKHUIDLUSHRSOH:DQGVRU6FHSWUHVWKRVHPXFK

IDLUHUDQGVRRQ0DQ\:DQGVWRJHWKHUPLJKWVLJQLI\IHDVWLQJPDQ\
&XSVORYHPDNLQJ6ZRUGVTXDUUHOOLQJDQGWURXEOH&RLQVRU3HQWDFOHV
PRQH\
:KHUHWKHPRGHRIUHDGLQJWKHFDUGVUHTXLUHVWKDWWKHSHUVRQ
FRQVXOWLQJVKRXOGEHUHSUHVHQWHGKHVKRXOGWDNHRQHRIWKH.LQJVWR
UHSUHVHQWKLPVHOIDFFRUGLQJWRKLVFRPSOH[LRQ,IDODG\FRQVXOWVWKH
FDUGVOHWKHUWDNHRQHRIWKH4XHHQVLIVKHEHUDWKHUIDLUWKH4XHHQRI
&XSVLIVKHEHYHU\IDLUWKH4XHHQRI:DQGVRU6FHSWUHV,IWKH
LQTXLUHUEHTXLWHD\RXWKRUDER\OHWKLPWDNHRQHRIWKH.QLJKWVLID
YHU\\RXQJJLUOOHWKHUWDNHWKH.QDYHHWF(WWHLOODVSODQZDVWRWDNH
WZRRIWKH.H\VIRU6LJQLILFDWRUVWKDWDQVZHULQJWRWKH3RSHIRUDPDQ
WKDWDQVZHULQJWRWKH+LJK3ULHVWHVVIRUDZRPDQEXW,GRQRWWKLQN
WKLVLVVRZHOO7KHZRUVWRI(WWHLOODVV\VWHPLVWKDWKHVRFRPSOHWHO\
GHVWUR\VWKHPHDQLQJVRIWKH.H\VLQKLVDWWHPSWHGUHDUUDQJHPHQWRI
WKHPDVWRPDNHWKHPSUDFWLFDOO\XVHOHVVIRUKLJKHURFFXOWSXUSRVHV
,VKDOOQRZJLYHVHYHUDOPRGHVRIOD\LQJRXWWKHFDUGVIRUGLYLQDWLRQ
7KHUHDGHUFDQDGRSWZKLFKHYHUKHSUHIHUVRUKHFDQFRPELQHWKHP
:KDWHYHUPRGHRIOD\LQJRXWEHDGRSWHGLWLVQHFHVVDU\WKDWWKHSHUVRQ
LQTXLULQJVKRXOGFDUHIXOO\VKXIIOHWKHFDUGVZLWKWZRREMHFWVLQYLHZ
ILUVWO\WKDWRIWXUQLQJVRPHRIWKHFDUGVXSVLGHGRZQVHFRQGO\WKDWRI
WKRURXJKO\DOWHULQJWKHLUSRVLWLRQDQGVHTXHQFHLQWKHSDFN7KH\
VKRXOGWKHQEHFXW'XULQJWKHVKXIIOLQJDQGFXWWLQJWKHLQTXLUHUVKRXOG
WKLQNHDUQHVWO\RIWKHPDWWHUFRQFHUQLQJZKLFKKHLVDQ[LRXVIRU
LQIRUPDWLRQIRUXQOHVVKHGRHVWKLVWKHFDUGVZLOOUDUHO\UHDGFRUUHFWO\
7KLVVKXIIOLQJDQGFXWWLQJVKRXOGEHWKULFHUHSHDWHG7KHEDFNVRIWKH
FDUGVVKRXOGEHWRZDUGVWKHSHUVRQVKXIIOLQJ
),5670(7+2'7KHIXOOSDFNRIVHYHQW\HLJKWFDUGVKDYLQJ
EHHQILUVWGXO\VKXIIOHGDQGFXWGHDOWKHWRSFDUGRQDSDUWRIWKHWDEOH
ZKLFKZHZLOOFDOO%WKHVHFRQGFDUGRQDQRWKHUSODFHZKLFKZHZLOO
FDOO$7KHVHZLOOIRUPWKHFRPPHQFHPHQWRIWZRKHDSV$DQG%
LQWRZKLFKWKHZKROHSDFNLVWREHGHDOW7KHQGHDOWKHWKLUGDQG
IRXUWKFDUGVRQ%DQGWKHILIWKRQ$WKHVL[WKDQGVHYHQWKRQ%DQG
WKHHLJKWKRQ$WKHQLQWKDQGWHQWKRQ%DQGWKHHOHYHQWKRQ$
&RQWLQXHWKLVRSHUDWLRQRIGHDOLQJWZRFDUGVRQ%DQGRQHRQ$WLOO
\RXFRPHWRWKHHQGRIWKHSDFN$ZLOOWKHQFRQVLVWRIWZHQW\VL[
FDUGVDQG%RIILIW\WZR
1RZWDNHXSWKH%KHDSRIILIW\WZRFDUGV'HDOWKHWRSFDUGRQDIUHVK
SODFHZKLFKZHZLOOFDOO'DQGWKHVHFRQGFDUGRQDQRWKHUSODFH&
7KLVZLOOIRUPWKHEHJLQQLQJRIWZRIUHVK
KHDSV&DQG'7KHQGHDOWKHWKLUGDQGIRXUWKFDUGVRQ'DQGWKH
ILIWKRQ&WKHVL[WKDQGVHYHQWKRQ'DQGWKHHLJKWKRQ&DQGVRRQ
DVEHIRUHWKURXJKWKHVHILIW\WZRFDUGV7KHUHZLOOQRZEHWKUHHKHDSV
$ FDUGV& FDUGVDQG' FDUGV

$JDLQWDNHXSWKHKHDS'RIFDUGVDQGGHDOWKHWRSFDUGRQDIUHVK
VSRW)DQGWKHVHFRQGFDUGRQDQRWKHUSODFH(VRDVWRPDNHWZRIUHVK
KHDSV(DQG)1RZGHDOWKHWKLUGDQGIRXUWKFDUGVRQ)DQGWKHILIWK
RQ(DQGVRRQDVEHIRUHWKURXJKWKHVHFDUGV
7KHUHZLOOQRZEHIRXUKHDSVDOWRJHWKHU$ FDUGV& FDUGV(
DQG) 3XW)DVLGHDOWRJHWKHUDVWKHVHFDUGVDUHQRWWREH
XVHGLQWKHUHDGLQJDQGDUH6XSSRVHGWRKDYHQREHDULQJRQWKH
TXHVWLRQ7KHUHZLOOQRZUHPDLQ$&DQG(
7DNH$DQGDUUDQJHWKHFDUGVIDFHXSZDUGVIURPULJKWWROHIWEHLQJ
FDUHIXOQRWWRDOWHUWKHRUGHUVRWKDWWKH\DUHLQWKHIRUPRID
KRUVHVKRHWKHWRSFDUGEHLQJDWWKHORZHVWULJKWKDQGFRUQHUDQGWKH
WKDWWKHORZHVWOHIWKDQGFRUQHU5HDGWKHLUPHDQLQJVIURPULJKWWR
OHIWDVEHIRUHH[SODLQHG:KHQWKLVLVGRQHVRDVWRPDNHD&RQQHFWHG
DQVZHUWDNHWKHVWDQGWKDQGUHDGWKHLUFRPELQHGPHDQLQJWKHQ
WKDWRIWKHQGDQGWKDQGVRRQWLOO\RXFRPHWRWKHODVWSDLUZKLFK
ZLOOEHWKHWKDQGWK3XW$DVLGHDQGWDNH&DQGUHDGLWLQH[DFWO\
WKHVDPHZD\WKHQ(ODVW
7KLVLVDYHU\DQFLHQWPRGHRIUHDGLQJWKH7DURWDQGZLOOEHIRXQG
UHOLDEOH
6(&21'0(7+2':LWKGUDZWKH.LQJRU4XHHQVHOHFWHGIRU
WKH,QTXLUHUV6LJQLILFDWRUIURPWKHSDFN7KHQVKXIIOHDQGFXWWKH
VDPHDVEHIRUH3ODFHWKH6LJQLILFDWRURQWKHWDEOHIDFHXSZDUGV
OHDYLQJSOHQW\RIURRPIRUWKHVHOHFWHGFDUGVRQWKHOHIWKDQGVLGHRILW
1RZJRFDUHIXOO\WKURXJKWKHSDFNWDNLQJWKHWRSFDUGILUVWWKHQWKH
VHYHQWKFDUGIURPLWDQGVRRQWKURXJKWKHSDFNUHFRPPHQFLQJLI
QHFHVVDU\XQWLO\RXKDYHGUDZQFDUGVE\WDNLQJHYHU\VHYHQWK
$UUDQJHWKHVHFDUGVLQWKUHHURZVRIVHYHQHDFKIURPULJKWWROHIW
RQWKHOHIWKDQGVLGHRIWKH6LJQLILFDWRUWKXV
























6LJQLILFDWRU



5HDGWKHPHDQLQJRIHDFKURZIURPULJKWWROHIWEHJLQQLQJZLWKWKH
6LJQLILFDWRUWKHQFRPELQHWKHVWDQGVWWKHQGDQGWKDQGVR
RQDVLQWKHSUHYLRXVPHWKRG
7+,5'0(7+2'7KLVPRGHRIOD\LQJRXWWKHFDUGVLVUDWKHU
PRUHFRPSOLFDWHGWKDQWKHSUHFHGLQJ:LWKGUDZWKH6LJQLILFDWRUDQG
VKXIIOHDQGFXWDVEHIRUH7KHQGHDOWKHPDVLQWKLVGLDJUDPIDFH
XSZDUGV
   
  
    
   

      











  
      
     
   
    
          

           
           



































   
    
  

 
   
















































  

 




 
  
  
  
  
  
  


 

    
 



 
 
 
 

      
6LJQLILFDWRU
      
      

            
      

     


        
 

      
  

    
 

      
 

     


  
 
 
   
 
    
    
    

7KHFDUGVZLOOWKXVIRUPDWULDQJOHZLWKLQDVSHFLHVRIDUFKDQGWKH
6LJQLILFDWRURIWKH,QTXLUHULVWREHSODFHGLQWKHFHQWUHRIWKHWULDQJOH
IDFHXSZDUGV7KHWRSFDUGLVWREHGHDOWRQQXPEHUWKHVHFRQGFDUG
RQQXPEHUWKHWZHOIWKFDUGRQQXPEHUDQGVRRQXSWRQXPEHU
ZKHQWKHUHPDLQLQJFDUGVDUHWREHSXWDVLGHDQGQRWXVHGLQWKH
UHDGLQJ
7KHQWRDQGWRLQFOXVLYHZLOOVKRZWKHSDVWWRDQG
WRLQFOXVLYHZLOOVKRZWKHSUHVHQWDQGWRDQGWR
LQFOXVLYHZLOOVKRZWKHIXWXUH
1RZUHDGWKHPVLPSO\LQRUGHUIURPWRIRUWKHSDVWIURPWR
IRUWKHSUHVHQWDQGIURPWRIRUWKHIXWXUH
7KHQFRPELQHWKH6LJQLILFDWRUZLWKHYHU\WZRFDUGVWKXV66
6DQGVRRQXSWR6IRUWKHSDVW7KHQWDNH6
6DQGVRRQIRUWKHSUHVHQW$QGWKHQWDNH66XS
WR6IRUWKHIXWXUH
$JDLQYDU\WKHFRPELQDWLRQVE\WDNLQJ6XSWR6
IRUWKHSDVW6XSWR6IRUWKHSUHVHQWDQG
6XSWR6IRUWKHIXWXUH
)LQDOO\FRPELQHWKHPDOOWRJHWKHUWKXVDQGVRRQ
XSWRSODFLQJWKHPLQDVLQJOHSDFNHWRQHRQWKHRWKHUDV\RXGR
VRDQGZKHQWKLVLVILQLVKHGGHDOWKHZKROHFDUGVLQRQHODUJH
FLUFOHSODFLQJWKH6LJQLILFDWRUDVDVWDUWLQJSRLQWZKHQZLOOEHWKH
ILUVWFDUGDQGWKHODVWFDUGRQHLWKHUVLGHRIWKH6LJQLILFDWRU1RZ
JDWKHUWKHPXSWKXVLQSDLUVIRUWKHODVWUHDGLQJ6DQG
VRRQXSWRWKHODVWFDUGZKLFKZLOOEHDVLQJOHRQH'UDZWZRRWKHU
IUHVKFDUGVDWUDQGRPIURPWKHFDUGVZKLFKKDYHQRWEHHQXVHGLQ
WKHUHDGLQJDQGSODFHWKHPIDFHXSZDUGVRQHRQHLWKHUVLGHWRIRUPD
VXUSULVH5HDGWKHVHWKUHHIURPULJKWWROHIWDVFRQFOXVLRQ
7KLVPRGHLVUDWKHUGLIILFXOWDWILUVWEXWSUDFWLFHZLOOJLYHIDFLOLW\
7KHVH7DURW&DUGVPD\EHXVHGOLNHWKHRUGLQDU\SDFNVIRUJDPHVDV
ZHOODVIRUGLYLQDWLRQDQGLWPD\EHDVZHOOWRJLYHWKHJHQHUDOUXOHV
DQGPRGHRISOD\7KH*DPHRI7DURWPD\EHSOD\HGE\HLWKHUWZRRU
WKUHHSHUVRQV7KHIXOOSDFNRIFDUGVLVVKXIIOHGDQGFXWLQWKH











 
 
 
 
 
 
 
 
 
































RUGLQDU\PDQQHU7KHGHDOHUGHDUVWKHPRXWLQWKUHHKDQGVE\ILYH
FDUGVDWDWLPHDQGSODFHVWKHUHPDLQLQJWKUHHFDUGVDWKLVRZQULJKW
KDQGVLGH7KHUHZLOOWKXVEHWKUHHKDQGVRIFDUGVHDFKDQGWKUHH
FDUGVEHVLGHV7KHSOD\HUVVRUWWKHLUKDQGVDQGWKHGHDOHUGLVFDUGVWKH
WKUHHPRVWXVHOHVVFDUGVLQKLVRZQKDQGDQGH[FKDQJHVWKHPIRUWKH
EHIRUHPHQWLRQHGWKUHHFDUGV7KHGHDOLVWDNHQLQURWDWLRQE\HDFK
SOD\HU7KHPHWKRGRIGHDOLQJLVWKHVDPHZKHWKHUWZRRUWKUHH
SOD\HUVSDUWLFLSDWHWKUHHKDQGVEHLQJGHDOWRXWLQHDFKLQVWDQFHEXWLI
RQO\WZRSOD\HUVFRQWHQGZLWKHDFKRWKHUWKHWKLUGKDQGLVXQWRXFKHG
E\HLWKHUSDUW\
7KHSRLQWVFRQVWLWXWLQJWKHJDPHDUHZKLFKPD\EHPDUNHGRQD
FULEEDJHERDUGRQSDSHURUE\DQRUGLQDU\EH]LTXHPDUNHU
%HIRUHWKHKDQGVDUHSOD\HGRXWWKHLUVFRUHLVUHFNRQHGLQWKHIROORZLQJ
ZD\
7KHWUXPSVDUHQRWDOORIWKHVDPHYDOXH
DUHFDOOHGWKH)LYH*UHDWHU7UXPSV
DUHFDOOHGWKH)LYH/HVVHU7UXPSV
:KRHYHUKDVWKUHHRIWKH*UHDWHURUWKUHHRIWKH/HVVHU7UXPSVLQKLV
KDQGVFRUHVSRLQWVIRUWKHVDPHSRLQWVLIKHKDVIRXUDQG
SRLQWVLIKHKDYHDOOILYH,IWKHSOD\HUKDVDQ\WHQWUXPSVLQKLVKDQG
WKH\ZLOOVFRUHSRLQWVDQ\WKLUWHHQWUXPSVSRLQWV,WGRHVQRW
PDWWHULI*UHDWHURU/HVVHU7UXPSVZKLFKKDYHEHHQDOUHDG\VFRUHG
IRUPSDUWRIVXFKWHQRUWKLUWHHQDOOVFRUHVDUHLQGHSHQGHQWRIRWKHU
FRPELQDWLRQV)XUWKHUPRUHIRUDQ\FDUGVWREHVFRUHGWKH\PXVWEH
VKRZQWRWKHDGYHUVDU\DWWKHWLPHRIVFRULQJWKLVUXOHKROGVJRRGLQ
DOOFDVHV7KHQRQGHDOHUVFRUHVDQGOHDGVILUVW,IWKUHHSOD\WKHSOD\HU
RQWKHGHDOHUVOHIWKDQGEHJLQV
6HYHQFDUGVEHDUWKHGLVWLQJXLVKLQJWLWOHRI7DURW7UXPSVWKH\DUH
7KH8QLYHUVHWKH0DWRU)RROLVK0DQWKH3DJDG-XJJOHURU
0DJLFLDQWKH.LQJRI6FHSWUHVWKH.LQJRI&XSVWKH.LQJRI
6ZRUGVDQGWKH.LQJRI3HQWDFOHV
,IWKHSOD\HUKDVDQ\WZRRIWKHVH7DURW7UXPSVKHFDQDVNKLV
RSSRQHQWIRUDWKLUGLIWKHODWWHUFDQQRWUHSO\E\VKRZLQJDWKLUG7DURW
7UXPSWKHIRUPHUFDQVFRUHSRLQWVEXWLIKHKDVWKHWKLUGLWPXVWEH
JLYHQXSWRWKHDVNHUZKRWKHQGRHVQRWVFRUHEXWJLYHVKLPVRPH
FDUGRIVPDOOYDOXHLQH[FKDQJH)RUHYHU\WKUHH7DURW7UXPSVDFWXDOO\
KHOGLQWKHKDQGWKHKROGHUPDUNVSRLQWV
6HTXHQFHVRIWUXPSVRURIFDUGVRIWKHVDPHVXLWFRXQWIRUHYHU\IRXU
FDUGVLQVHTXHQFHSRLQWVIRUHYHU\VHYHQFDUGVSRLQWVIRUWHQ
FDUGVSRLQWV$OOFDUGVIRUPLQJWKHVHVFRUHVPXVWEHVKRZQWRWKH
DGYHUVDU\

7KH)RROLVK0DQLVWKHORZHVWFDUGLQWKHSDFNLQSOD\LQJWKHKDQG
FDQWDNHQRFDUGRIDQ\VXLWDQGPD\EHSOD\HGWRDFDUGRIDQ\VXLW
)RULQVWDQFHLIWKHDGYHUVDU\OHDGVD.LQJDQG\RXKDYHRQO\WKH
4XHHQRIWKDWVXLWUHPDLQLQJLQ\RXUKDQGEXWKDYHDOVRWKH\RXFDQ
SOD\WKLVLQVWHDGRIWKH4XHHQDQGWKXVVDYHKHUIURPEHLQJWDNHQ$
.LQJFXWFRXQWVSRLQWVWRZKRVRHYHUFXWVLW,QHDFKVXLW.LQJLV
KLJKHVWWKHQFRPH4XHHQ.QLJKW.QDYH7HQ1LQHHWFGRZQWR
$FHZKLFKLVORZHVWDQGFDQRQO\WDNHWKH7KH7UXPSVUHFNRQ
IURPZKLFKLVKLJKHVWWRZKLFKLVORZHVW<RXPXVWIROORZVXLW
LI\RXFDQLIQRW\RXPD\WUXPS(DFKWULFNVKRXOGEHNHSWVHSDUDWH
IRUFRXQWLQJDIWHUZDUGV2IFRXUVHWKHSULQFLSDOFDUHRIWKHSOD\HU
VKRXOGEHGLUHFWHGWRZDUGVVDYLQJKLVRZQLPSRUWDQWFDUGVDQGWDNLQJ
WKRVHRIWKHDGYHUVDU\7KHSOD\HUZKRWDNHVDWULFNOHDGVQH[W:KHQ
DOOWKHKDQGLVSOD\HGRXWWKHWULFNVRQHLWKHUVLGHDUHFRXQWHGDV
IROORZV
)RUHYHU\WULFNLQZKLFKWKHUHLVD7DURW7UXPSSRLQWVWKHFRXQWV
WRLWVRULJLQDOSRVVHVVRUZKLOHWKH3DJDGFRXQWVWRWKHSOD\HUZKR
WDNHVLW)RUHYHU\WULFNZLWKD
4XHHQSRLQWVZLWKD.QLJKWSRLQWVZLWKD.QDYHSRLQWVIRU
HYHU\RWKHUWULFNSRLQW
$WWKHHQGRIHDFKKDQGWKHSRLQWVPDGHE\HDFKSOD\HUDUHDGGHGXS
VHSDUDWHO\WKHQWKHOHVVHULVWDNHQIURPWKHJUHDWHUDQGRQO\WKHH[FHVV
SRLQWVRIWKHPRUHIRUWXQDWHSOD\HUDUHVFRUHG7KHVDPHLVGRQHLQ
HDFKKDQGDQGWKHSOD\HUZKRLQWKLVZD\ILUVWUHDFKHVSRLQWVRU
RYHULQWKHILQDOKDQGZLQVWKHJDPH
)RUP\UHDGHUVFRQYHQLHQFH,DSSHQGDWDEOHRIWKHSRLQWVZKLFKFDQ
EHVFRUHG
6FRUHGLQ+DQG
)RUDQ\RIWKH*UHDWHU7UXPSVKHOGLQKDQG
)RUDQ\RIWKH*UHDWHU7UXPSVKHOGLQKDQG
)RUDOORIWKH*UHDWHU7UXPSVKHOGLQKDQG
)RUDQ\RIWKH/HVVHU7UXPSVKHOGLQKDQG
)RUDQ\RIWKH/HVVHU7UXPSVKHOGLQKDQG
)RUDOORIWKH/HVVHU7UXPSVKHOGLQKDQG 
)RUDQ\7UXPSVKHOGLQKDQG
)RUDQ\7UXPSVKHOGLQKDQG
)RUDQ\7DURW7UXPSVFDOOHGXQDQVZHUHG
)RUDQ\7DURW7UXPSVDFWXDOO\KHOGLQKDQG
)RUHYHU\6HTXHQFHRI&DUGV
)RUHYHU\6HTXHQFHRI&DUGV
)RUHYHU\6HTXHQFHRI&DUGV
6FRUHGLQ3OD\
)RUD.LQJFXW
)RUHDFK7ULFNFRQWDLQLQJD7DURW7UXPS




















3RLQWV













3RLQWV



7KHHDFK7ULFNFRQWDLQLQJD4XHHQ 
)RUHDFK7ULFNFRQWDLQLQJD.QLJKW 
)RUHDFK7ULFNFRQWDLQLQJD.QDYH
)RUHYHU\7ULFNRIWZRSODLQ&DUGV 











,IWKUHHSOD\HUVFRQWHQGRIFRXUVHWKHWKLUGSOD\HUZLOOIRUPDQ
DGGLWLRQDOIDFWRULQWKHJDPH7KHQZKHQWKHWKUHHFRPSDUHWKHLU
YDULRXVVFRUHVLQWKHVDPHKDQGRQO\KHZKRKDVPRVWVKRXOGVFRUH
DQGWKHQRQO\WKHDPRXQWE\ZKLFKKHH[FHHGVWKHSOD\HUZKRFRPHV
VHFRQG7KHRWKHUSOD\HUVGRQRWVFRUHDWDOO
%HIRUHFRQFOXGLQJWKLVVKRUWWUHDWLVH,ZLOOVD\DIHZZRUGVRQWKH
RFFXOWDQG4DEDOLVWLFDOVLJQLILFDWLRQRIWKHVHZRQGHUIXO7DURW&DUGV,W
KDVEHHQORQJNQRZQWKDWWKHRUGLQDU\FDUGSDFNZDVVXVFHSWLEOHRI
VRPHSHFXOLDUQXPHULFDOVLJQLILFDWLRQVHJ
&DUGVLQWKHSDFNVXJJHVWZHHNVLQWKH\HDU
&DUGVLQHDFKVXLWVXJJHVWOXQDUPRQWKVLQWKH\HDUZHHNVLQWKH
TXDUWHU
VXLWVLQWKHSDFNVXJJHVWVHDVRQVLQWKH\HDU
3LFWXUH&DUGVLQWKHSDFNVXJJHVWPRQWKVLQWKH\HDUVLJQVRIWKH
=RGLDF
)XUWKHUPRUHLIZHDGGWRJHWKHU
7KHSLSVRQWKHSODLQFDUGVRIWKHIRXUVXLWV
7KHSLSVRQWKH3LFWXUH&DUGV

7ZHOYH3LFWXUH&DUGVUHFNRQHGDVHDFK
7KHQXPEHURIFDUGVLQHDFKVXLW
:HVKDOOREWDLQWKHQXPEHURIGD\VLQWKH\HDU













%XWFRQFHDOHGEHKLQGWKHLUDSSDUHQWO\DUELWUDU\DQGEL]DUUHGHVLJQVWKH
7DURW&DUGVFRQWDLQDIDUPRUHFRPSOLFDWHGV\VWHPRIUHFRQGLWH
V\PEROLVP:HIPGWKHQXPEHUWHQPXOWLSOLHGE\WKHP\VWLFDOQXPEHU
IRXUDQGFRPELQHGZLWKDSULPLWLYHKLHURJO\SKLFDOSKDEHWRIWZHQW\
WZROHWWHUV
(OLSKDV/qYLVD\VLQKLV+LVWRLUHGHOD0DJLH7KHDEVROXWH
KLHURJO\SKLFDOVFLHQFHKDGIRULWVEDVLVDQDOSKDEHWRIZKLFKDOOWKH
JRGVZHUHOHWWHUVDOOWKHOHWWHUVLGHDVDOOWKHLGHDVQXPEHUVDQGDOOWKH
QXPEHUVSHUIHFWVLJQV
7KLVKLHURJO\SKLFDODOSKDEHWRIZKLFK0RVHVPDGHWKHJUHDWVHFUHWRI
KLV&DEDODDQGZKLFKKHUHWRRNIURPWKH(J\SWLDQVIRUDFFRUGLQJWR
WKH6HSKHU<HW]LUDKLWFDPHIURP$EUDKDPWKLVDOSKDEHWZHVD\LV
WKHIDPRXV%RRNRI7KRWKVXVSHFWHGE\&RXUWGH*qEHOLQWREH
SUHVHUYHGWRWKHSUHVHQWWLPHXQGHUWKHIRUPRIWKDWSHFXOLDUSDFNRI
FDUGVZKLFKLVFDOOHGWKH7DURW7KHWHQQXPEHUVDQGWZHQW\WZR
OHWWHUVDUHZKDWDUHFDOOHGLQWKH&DEDODWKHWKLUW\WZRSDWKVRIVFLHQFH

DQGWKHLUSKLORVRSKLFDOGHVFULSWLRQLVWKHVXEMHFWRIWKDWSULPLWLYHDQG
UHYHUHGZRUNNQRZQDVWKH6HSKHU<HW]LUDKZKLFKLVVWLOOWREHIRXQG
LQWKHFROOHFWLRQRI3LVWRULXVDQGRWKHUV7KH$OSKDEHWRI7KRWKLVWKH
RULJLQDORIRXU7DURWRQO\LQDQDOWHUHGIRUP7KH7DURWZKLFKZHKDYH
LVRI-HZLVKRULJLQDQGWKHW\SHVRIWKHILJXUHVFDQQRWEHWUDFHGEDFN
IXUWKHUWKDQWKHUHLJQRI&KDUOHV9,
7KH6HSKHU<HW]LUDKUHIHUUHGWRLQWKHDERYHTXRWDWLRQKDVEHHQ
UHFHQWO\WUDQVODWHGE\P\IULHQG'U:\QQ:HVWFRWWZKRLVDVNLOIXO
DQGHUXGLWH4DEDOLVWLFDOVWXGHQWVRWKDWLWFDQQRZEHUHDGLQ(QJOLVK
,WFHUWDLQO\JLYHVLQP\RSLQLRQWKH4DEDOLVWLFDO.H\RIWKH7DURWDQG
VKRZVDWRQFHE\HYLGHQWDQDORJ\WKHDQFLHQWDQGUHOLJLRXVRULJLQRI
LWVEL]DUUHV\PEROLVP,WFRQVLVWVRIWKLUW\WKUHHVKRUWVHFWLRQVWKH
WKLUW\WKLUGEHLQJPHUHO\UHFDSLWXODWRU\GLYLGHGLQWRILYHFKDSWHUVDQG
HOXFLGDWHGE\WKLUW\WZRRFFXOWSDUDJUDSKVFDOOHGWKH3DWKV,QIDFWLW
PD\EHFDOOHGDWUHDWLVHRQWKHWHQDQGWKHWZHQW\WZR7KHQXPEHUV
IURPRQHWRWHQDUHVDLGWRV\PEROLVHWKH6SLULW$LU:DWHU)LUH
+HLJKW'HSWK(DVW:HVW1RUWK6RXWK7KHWZHQW\WZROHWWHUVDUH
GLYLGHGLQWRWKUHH0RWKHU/HWWHUV$06+UHIHUULQJWR$LU:DWHU
DQG)LUHVHYHQGRXEOHOHWWHUV%*'.357+UHIHUULQJWRWKH
VHYHQSODQHWVHWFDQGWZHOYHVLPSOHOHWWHUV+9=&+7,/1
627]4UHIHUULQJWRWKHWZHOYHVLJQVRIWKH=RGLDFHWF
&KULVWLDQWKHGLVFLSOHRI/qYLLQKLVUHFHQWZRUNRQ0DJLFKDVPDGH
WKHH[SODQDWLRQRIWKHWZHQW\WZRKLHURJO\SKLFVRIWKH7DURWIRUPSDUW
RIWKHLQLWLDWRU\FHUHPRQLHVRIWKH(J\SWLDQP\VWHULHVRI&UDWD5HSRD
7KHV\PEROVRIWKUHHRIWKHWZHQW\WZR7UXPSVRIWKH7DURWZHUHWKXV
UHVWRUHGE\(OLSKDV/qYL
7KH&KDULRW$FXELFDOFKDULRWZLWKIRXUFROXPQVVXUPRXQWHGE\
DQD]XUHDQGVWDUGHFNHGFDQRS\:LWKLQWKHFKDULRWDQGEHWZHHQWKH
IRXUFROXPQVVWDQGVD&RQTXHURUFURZQHGZLWKDFLUFOHWIURPZKLFK
ULVHDQGVKLQHWKUHHSHQWDJUDPVRIJROG2QKLVFXLUDVVDUHWKUHHULJKW
DQJOHVDQGRQKLVVKRXOGHUVWKH8ULPDQG7KXPPLPV\PEROLVHGE\
WKHWZRFUHVFHQWVRIWKH0RRQLQLQFUHDVHDQGGHFUHDVH,QKLVKDQGLVD
VFHSWUHVXUPRXQWHGE\DJOREHDVTXDUHDQGDWULDQJOH+LVDWWLWXGHLV
SURXGDQGWUDQTXLO7RWKH&KDULRWLVDWWDFKHGDGRXEOHVSKLQ[RU
UDWKHUWZRVSKLQ[HVMRLQHGWRJHWKHURQHRIWKHPWXUQVLWVKHDGDQG
WKH\ERWKORRNLQWKHVDPHGLUHFWLRQ7KHVSKLQ[ZKLFKWXUQVLWVKHDG
WRZDUGVWKHRWKHULVEODFNDQGPHQDFLQJWKHRWKHULVZKLWHDQGFDOP
2QWKHVTXDUHZKLFKIRUPVWKHIURQWRIWKH&KDULRWZHVHHWKH,QGLDQ
OLQJDPVXUPRXQWHGE\WKHIO\LQJJOREHRIWKH(J\SWLDQV
7KH:KHHORI)RUWXQH$ZKHHORIVHYHQVSRNHVWKH
FRVPRJRQLFDOZKHHORI(]HNLHOZLWKDGRJKHDGHGILJXUHDVFHQGLQJRQ
RQHVLGH$QXELVWKH(J\SWLDQ0HUFXU\DQGDGHPRQGHVFHQGLQJRQ
WKHRWKHUWKH(J\SWLDQHYLOGHLW\7\SKRQWKHIRUPHURIWKHVHEHDUVD
FDGXFHXVWKHODWWHUDWULGHQWERWKILJXUHVDUHERXQGWRWKHZKHHO

$ERYHWKHPLVDVSKLQ[DWWKHEDODQFHSRLQWRIWKHZKHHOKROGLQJD
GUDZQVZRUGEHWZHHQLWVOLRQVFODZV
7KH'HYLO7KURQHGRQDFXEHDERYHWKH8QLYHUVHLVDJRDW
KHDGHGVDW\UOLNHILJXUHEHDULQJRQLWVEURZWKHSHQWDJUDPDSH[
XSZDUGVRDVWRPDNHLWDV\PERORI/LJKW:LWKRQHKDQGLWSRLQWV
XSZDUGVWRWKHV\PERORIWKH0RRQLQLQFUHDVHZLWKWKHRWKHU
GRZQZDUGVWRWKDWRIWKH0RRQLQGHFUHDVHWKXVV\PEROLVLQJWKH
HWHUQDOHTXLOLEULXPRI0HUF\DQG-XVWLFHWKHILUVWWZRILQJHUVDQG
WKXPERIHDFKKDQGDUHH[WHQGHGDVLQJLYLQJWKHVLJQRIEHQHGLFWLRQ
2QHDUPLVIHPLQLQHWKHRWKHUPDVFXOLQH7KHWRUFKRILQWHOOLJHQFHLV
SODFHGEHWZHHQLWVKRUQVDVWKH0DJLFDO/LJKWRIWKH8QLYHUVDO
(TXLOLEULXP7KHFDGXFHXVZKLFKKROGVWKHSODFHRIWKHJHQHUDWLYH
RUJDQVVLJQLILHVWKHHWHUQLW\RIOLIHWKHEHOO\LVFRYHUHGZLWKVFDOHVWR
UHSUHVHQW:DWHUWKHFLUFOHDERYHLWLVWKHDWPRVSKHUHWKH:LQJVDUH
WKHHPEOHPRIWKH9RODWLOHDQGWKHGHIRUPHGDQGJRDWOLNHIHHWUHVW
XSRQWKHHDUWK
6SDFHGRHVQRWDOORZPHWRHQWHUIXUWKHULQWRWKHVXEMHFWRQZKLFK
LQGHHGVHYHUDOYROXPHVPLJKWEHZULWWHQZLWKRXWH[KDXVWLQJLW,FDQ
RQO\KRSHWKDWWKLVVKRUWWUHDWLVHZLOOVXIILFHWRJLYHP\UHDGHUVVRPH
LGHDRIWKHUHFRQGLWHPHDQLQJRIWKH7DURW&DUGVDQGKRZWRHPSOR\
WKHPLQGLYLQDWLRQ
 
>L@7KLVLVSDUWO\WDNHQE\9DLOODQWIURP&RXUWGH*qEHOLQV0RQGH
3ULPLWLIYROS