Court Opinion

ID: 2970239
Source: CourtListenerOpinion
Date Created: 2015-09-22 16:07:55.606728+00
Date Added: 2024-06-11T11:40:49.908130
License: Public Domain

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

,QUH5$<021' % <$7(6        ;
                    'HEWRU       
BBBBBBBBBBBBBBBBBBBBBBBB          
                                     1R
                                  
:,//,$0 7 +(1'21                 !
                                  
7UXVWHH                          
            3ODLQWLII$SSHOOHH 
                                  
            Y                    
                                  
                                  
5$<021' % <$7(6 0'           
3&3URILW6KDULQJ3ODQ         
5$<021' % <$7(6                 
7UXVWHH                          
      'HIHQGDQWV$SSHOODQWV 
                                 1
      $SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW
   IRUWKH(DVWHUQ'LVWULFWRI7HQQHVVHHDW.QR[YLOOH
    1Rn&XUWLV/&ROOLHU'LVWULFWsXGJH
               $UJXHG2FWREHU
           'HFLGHGDQG)LOHG$SULO

                            
       ,QUH<DWHV                                     1R

    %HIRUH1(/621&/$<DQG*$5:22'&LUFXLW
                       sXGJHV
                        BBBBBBBBBBBBBBBBB
                              &2816(/
$5*8('  :LOOLDP 6 /RFNHWW sU .(11(5/<
0217*20(5< 	 ),1/(< .QR[YLOOH 7HQQHVVHH IRU
$SSHOODQWV  &RQUDG 0 7URXWPDQ 752870$1 	
752870$1 /D)ROOHWWH 7HQQHVVHH IRU $SSHOOHH
21 %5,()  sDPHV $ +ROLILHOG sU .(11(5/<
0217*20(5< 	 ),1/(< .QR[YLOOH 7HQQHVVHH IRU
$SSHOODQWV  &RQUDG 0 7URXWPDQ 752870$1 	
752870$1/D)ROOHWWH7HQQHVVHHIRU$SSHOOHH
                        BBBBBBBBBBBBBBBBB
                            23,1,21
                        BBBBBBBBBBBBBBBBB
  '$9,'$1(/621&LUFXLWsXGJH7KHTXHVWLRQKHUHLV
ZKHWKHUD&KDSWHUEDQNUXSWF\WUXVWHHZDVHQWLWOHGWRDFRXUW
RUGHUVHWWLQJDVLGHDVDYRLGDEOHSUHIHUHQFHDORDQUHSD\PHQW
PDGH E\ DQ LQVROYHQW GHEWRU WR KLV ZKROO\RZQHG
FRUSRUDWLRQjV SURILW VKDULQJSHQVLRQ SODQ RQO\ WKUHH ZHHNV
EHIRUHDQLQYROXQWDU\EDQNUXSWF\SHWLWLRQZDVILOHGDJDLQVW
WKHGHEWRU%RWKWKHEDQNUXSWF\FRXUWDQGWKHGLVWULFWFRXUW
GHWHUPLQHGWKDWWKHWUXVWHHLQEDQNUXSWF\ZDVHQWLWOHGWRKDYH
WKH UHSD\PHQW VHW DVLGH WKHUHE\ LQFUHDVLQJ WKH DPRXQW RI
PRQH\DYDLODEOHIRUFUHGLWRUV
  3XUVXDQWWRWKH(PSOR\HH5HWLUHPHQW,QFRPH6HFXULW\$FW
(5,6$ WKH SURILW VKDULQJSHQVLRQ SODQ FRQWDLQHG D
VSHQGWKULIW FODXVH SURYLGLQJ WKDW H[FHSW IRU ORDQV WR
SDUWLFLSDQWV QR LQWHUHVW DYDLODEOH XQGHU WKH SODQ ZRXOG EH
VXEMHFWWRYROXQWDU\RULQYROXQWDU\DOLHQDWLRQRUDVVLJQPHQW

    
     7KH +RQRUDEOH :LOO / *DUZRRG 8QLWHG 6WDWHV &LUFXLW sXGJH IRU WKH
)LIWK &LUFXLW VLWWLQJ E\ GHVLJQDWLRQ
1R                                      ,QUH<DWHV      

7KHSODQDQGLWVWUXVWHHWKHGHEWRUZHDULQJDILGXFLDU\KDW
FRQWHQGWKDWWKLVUHVWUDLQWRQDOLHQDWLRQZDVHQIRUFHDEOHXQGHU
ERWK (5,6$ VHH  86&  D DQG  DQG D
7HQQHVVHH VWDWXWH 7HQQ &RGH $QQ  E
7KHUHIRUHDUJXHWKHDSSHOODQWVWKHPRQH\LQTXHVWLRQZDV
QRWVXEMHFWWRUHFDSWXUHE\WKHWUXVWHHLQEDQNUXSWF\JLYHQWKH
%DQNUXSWF\&RGHSURYLVLRQ86&FWKDWVD\V
DUHVWUDLQWRQDOLHQDWLRQRIDGHEWRUjVEHQHILFLDOLQWHUHVWLQD
WUXVWLVHQIRUFHDEOHLQDEDQNUXSWF\FDVHLIHQIRUFHDEOHXQGHU
DSSOLFDEOHQRQEDQNUXSWF\ODZ
  :HFRQFOXGHWKDWQHLWKHU(5,6$QRUWKH7HQQHVVHHVWDWXWH
ZDVDSSOLFDEOHRQWKHIDFWVSUHVHQWHG$FFRUGLQJO\ZHVKDOO
DIILUP WKH GHFLVLRQ HQWHUHG LQ IDYRU RI WKH WUXVWHH LQ
EDQNUXSWF\
                                 ,
  7KHGHEWRU'U5D\PRQG%<DWHVZDVWKHVROHRZQHURI
DFRUSRUDWLRQNQRZQDV5D\PRQG%<DWHV0'3&7KH
FRUSRUDWLRQPDLQWDLQHGDSURILWVKDULQJSHQVLRQSODQWKDWZDV
WD[TXDOLILHG XQGHU   RI WKH ,QWHUQDO 5HYHQXH &RGH
'U <DWHV ZDV WKH SODQjV DGPLQLVWUDWRU DQG WUXVWHH  $V RI
sXQH   IRXU SHRSOH KDG EHHQ GHVLJQDWHG DV
SDUWLFLSDQWVLQWKHSODQ'U<DWHVZDVRQHRIWKHIRXU
  ,Q'HFHPEHURI'U<DWHVERUURZHGIURPWKH
SODQ DW  SHUFHQW LQWHUHVW  7KH ORDQ ZDV VXSSRVHG WR EH
UHSDLGLQPRQWKO\LQVWDOOPHQWVRYHUDILYH\HDUSHULRGEXW
'U<DWHVIDLOHGWRPDNHWKHPRQWKO\SD\PHQWV
  ,QsXQHRIWKHWHUPRIWKHORDQZDVH[WHQGHGIRUILYH
\HDUV  6WLOO QR PRQWKO\ LQVWDOOPHQWV ZHUH SDLG  ,Q PLG
1RYHPEHU RI  KRZHYHU DW D WLPH ZKHQ KH PXVW EH
SUHVXPHGWRKDYHEHHQLQVROYHQWVHH86&I
'U<DWHVXVHGSURFHHGVRIDKRXVHVDOHWRPDNHSD\PHQWVWR
WKH SODQ LQ DPRXQWV WRWDOLQJ   7KLV ILJXUH
UHSUHVHQWHG UHSD\PHQW RI WKH ORDQ LQ IXOO ZLWK DFFUXHG
LQWHUHVW
      ,QUH<DWHV                                    1R       1R                                    ,QUH<DWHV     

   2Q'HFHPEHUoWKUHHZHHNVDIWHUWKHUHSD\PHQWo              DQG,QUH6DQGHUV%50'7HQQ$V
DQLQYROXQWDU\EDQNUXSWF\SHWLWLRQZDVILOHGDJDLQVW'U<DWHV          GHEWRU'U<DWHVKDVQRWFODLPHGWKHH[HPSWLRQ'U<DWHV
XQGHU&KDSWHU7LWOHRIWKH8QLWHG6WDWHV&RGH(LJKW            DVWUXVWHHRIWKHSODQZRXOGOLNHWRFODLPDQH[HPSWLRQRQ
PRQWKV ODWHU WKH WUXVWHH LQ EDQNUXSWF\ FRPPHQFHG DQ              EHKDOIRI'U<DWHVDVEHQHILFLDU\GHEWRUEXWKHLVQRWHQWLWOHG
DGYHUVDU\SURFHHGLQJDJDLQVWWKHSODQDQGLWVWUXVWHHXQGHU          WRGRVR6HH,QUH5RVV%51'1<
86&EDQG7KHFRPSODLQWDVNHGWKHFRXUWWR
DVHWWKHUHSD\PHQWDVLGHDVDSUHIHUHQWLDOWUDQVIHUDQGE            7KHDSSHOODQWVKDYHQRWDUJXHGWKDWWKHVSHQGWKULIWFODXVH
RUGHUWKDWWKHPRQH\EHSDLGRYHUWRWKHEDQNUXSWF\WUXVWHH            LQWKH<DWHVSODQLVHQIRUFHDEOHDWFRPPRQODZRULQHTXLW\
,WLVXQGLVSXWHGWKDWWKHWUDQVIHUPDGHWRWKHSODQ          XQGHU7HQQHVVHHMXULVSUXGHQFHVRLWLVQRWLQFXPEHQWRQXV
LQ1RYHPEHUTXDOLILHGDVDSUHIHUHQFHXQGHU86&            WRRSLQHRQWKDWTXHVWLRQ

                                                                          $)),50('
  2QFURVVPRWLRQVIRUVXPPDU\MXGJPHQWWKHEDQNUXSWF\
FRXUW HQWHUHG D MXGJPHQW JUDQWLQJ WKH UHOLHI VRXJKW LQ WKH
EDQNUXSWF\WUXVWHHjVFRPSODLQW7KHGLVWULFWFRXUWDIILUPHG
DQGWKLVDSSHDOIROORZHG
                                  ,,
  7KH%DQNUXSWF\&RGHSURYLGHVWKDWDVDJHQHUDOUXOHDOO
SURSHUW\LQWHUHVWVRIDEDQNUXSWGHEWRUPXVWEHWXUQHGRYHUWR
WKH WUXVWHH LQ EDQNUXSWF\ IRU WKH EHQHILW RI FUHGLWRUV  
86&D&I,QUH:LOFR[)GWK
&LU
  $V ZH KDYH VHHQ  86&  F FDUYHV RXW DQ
H[FHSWLRQ WR WKH JHQHUDO UXOH  6HFWLRQ F UHDGV DV
IROORZV
    m$UHVWULFWLRQRQWKHWUDQVIHURIDEHQHILFLDOLQWHUHVWRI
    WKHGHEWRULQDWUXVWWKDWLVHQIRUFHDEOHXQGHUDSSOLFDEOH
    QRQEDQNUXSWF\ ODZ LV HQIRUFHDEOH LQ D FDVH XQGHU WKLV
    WLWOHl
  7KH <DWHV SURILW VKDULQJSHQVLRQ SODQ LV D WUXVW WKDW
FRQWDLQVDUHVWULFWLRQRQWKHWUDQVIHURISDUWLFLSDQWVjEHQHILFLDO
LQWHUHVWV7KHUHVWULFWLRQFDSWLRQHGm6SHQGWKULIW&ODXVHlLV
FRXFKHGLQWKHIROORZLQJWHUPV
    m([FHSW IRU 3ODQ ORDQV WR 3DUWLFLSDQWV DV SHUPLWWHG E\
    $57,&/(DQGWKHDVVLJQPHQWVSURYLGHGWKHUHIRUQR
      ,QUH<DWHV                                      1R       1R                                        ,QUH<DWHV       

    EHQHILFLDU\H[FHSWWKHVWDWHRI7HQQHVVHH$OOUHFRUGVRI             EHQHILWRULQWHUHVWDYDLODEOHKHUHXQGHUZLOOEHVXEMHFWWR
    WKH GHEWRU FRQFHUQLQJ VXFK SODQ DQG RI WKH SODQ                 DVVLJQPHQW RU DOLHQDWLRQ HLWKHU YROXQWDULO\ RU
    FRQFHUQLQJ WKH GHEWRUjV SDUWLFLSDWLRQ LQ WKH SODQ RU            LQYROXQWDULO\7KHSUHFHGLQJVHQWHQFHVKDOODOVRDSSO\WR
    LQWHUHVW LQ WKH SODQ DUH H[HPSW IURP WKH VXESRHQD              WKHFUHDWLRQDVVLJQPHQWRUUHFRJQLWLRQRIDULJKWWRDQ\
    SURFHVVl  7HQQ &RGH $QQ  E  3ULRU WR           EHQHILWSD\DEOHZLWKUHVSHFWWRD3DUWLFLSDQWSXUVXDQWWR
    WKLVVHFWLRQZDVFRGLILHGDW7HQQ&RGH$QQ                D GRPHVWLF UHODWLRQV RUGHU XQOHVV VXFK RUGHU LV
    E                                                              GHWHUPLQHGWREHDTXDOLILHGGRPHVWLFUHODWLRQVRUGHUDV
                                                                            GHILQHGLQ6HFWLRQSRIWKH&RGHRUDQ\GRPHVWLF
   %\LWVWHUPVWKLVLVDQH[HPSWLRQVWDWXWHWKDWLVLWSXUSRUWV         UHODWLRQV RUGHU HQWHUHG EHIRUH sDQXDU\  l
WRPDNHSURSHUW\H[HPSWIURPWKHFODLPVRIFUHGLWRUV7KH                  (PSKDVLVVXSSOLHG
VWDWXWH FRQWDLQV QR GLUHFW UHIHUHQFH WR DQ\ UHWLUHPHQW SODQ
ODQJXDJHLPSRVLQJDUHVWULFWLRQRQWKHWUDQVIHURIDEHQHILFLDO             ,V WKLV VSHQGWKULIW FODXVH mHQIRUFHDEOH XQGHU DSSOLFDEOH
LQWHUHVW LQ WKH SODQ DQG LW GRHV QRW SXUSRUW WR PDNH DQ\      QRQEDQNUXSWF\ODZlZLWKLQWKHPHDQLQJRIWKDWSKUDVHDVXVHG
SURYLVLRQ RI WKH SODQ HQIRUFHDEOH DV VXFK  /LNH WKH             LQ86&F",ILWLVWKHFRXUWVEHORZHUUHGLQ
3HQQV\OYDQLDH[HPSWLRQVWDWXWHFRQVLGHUHGE\WKHFRXUWLQ,Q              UHTXLULQJWKDWWKHPRQH\'U<DWHVSXWLQWRWKHSODQRQWKH
UH/RZHQVFKXVV)GWK&LUWKH7HQQHVVHH               HYHRIKLVEDQNUXSWF\EHDVVLJQHGWRWKHEDQNUXSWF\WUXVWHH
H[HPSWLRQ VWDWXWH mRSHUDWHV ZLWKRXW UHJDUG WR D WUDQVIHU           IRUWKHEHQHILWRI'U<DWHVjFUHGLWRUV,IWKHFODXVHLVQRW
UHVWULFWLRQWKDWPD\EHFRQWDLQHGLQWKHWUXVWLQVWUXPHQWl,G          HQIRUFHDEOHXQGHUDSSOLFDEOHQRQEDQNUXSWF\ODZKRZHYHU
DW                                                                   WKH FRXUWV EHORZ GLG QRW HUU LQ KROGLQJ WKDW WKH WUXVWHH LQ
                                                                          EDQNUXSWF\ZDVHQWLWOHGWRWKHPRQH\
   1RQEDQNUXSWF\ODZWKDWGRHVQRWSXUSRUWWRSURYLGHIRUWKH
HQIRUFHPHQWRIDUHVWULFWLRQFRQWDLQHGLQWKHWUXVWLQVWUXPHQW              'U<DWHVFLWHVWZRVHSDUDWHERGLHVRIQRQEDQNUWXSF\ODZ
LVQRWWKHVRUWRIQRQEDQNUXSWF\ODZRIZKLFKWKH%DQNUXSWF\              WKDW DUH LQ KLV VXEPLVVLRQ DSSOLFDEOH  (5,6$ DQG WKH
&RGHVSHDNVLQ86&F7KHWH[WRIF            7HQQHVVHH&RGH:HFRQVLGHUHDFKLQWXUQ
LVQRWDEOHIRULWVmFODULW\lVHH3DWWHUVRQY6KXPDWH86
DWDQGm>Z@HPXVWHQIRUFHWKHVWDWXWHDFFRUGLQJWRLWV                                                 $
WHUPVl,GDW7KHDSSHOODQWVZRXOGKDYHXVJRZHOO
EH\RQGWKHOLWHUDOWHUPVRIFWKLVZHGHFOLQHWRGR              (5,6$ FRQWDLQV D SURYLVLRQ VWDWLQJ WKDW m>H@DFK SHQVLRQ
                                                                          SODQVKDOOSURYLGHWKDWEHQHILWVSURYLGHGXQGHUWKHSODQPD\
   :HUHDGLO\DFNQRZOHGJHWKDWFDVHODZIURPWZRRIRXUVLVWHU             QRWEHDVVLJQHGRUDOLHQDWHGl86&G7KLV
FLUFXLWV WKH 7KLUG DQG WKH (OHYHQWK VXJJHVWV WKDW WKRVH         SURYLVLRQmFOHDUO\LPSRVHVDµUHVWULFWLRQRQWKHWUDQVIHUjRID
FLUFXLWVZRXOGPDNHWKHRSSRVLWHFDOOKHUH6HH,QUH<XKDV            GHEWRUjV µEHQHILFLDO LQWHUHVWj LQ WKH WUXVWl  3DWWHUVRQ Y
)GG&LUDQG,QUH0HHKDQ)G              6KXPDWH  86     7KH <DWHV SODQ
WK&LU:LWKUHVSHFWKRZHYHULW                FRQWDLQHGDUHVWULFWLRQRIWKHVRUWSUHVFULEHGDQGRQHPLJKW
VHHPVWRXVIRUUHDVRQVDOUHDG\VXJJHVWHGWKDWZHZRXOGEH              VXSSRVH WKDW 'U <DWHV ZRXOG EH HQWLWOHG WR EULQJ D FLYLO
XVXUSLQJ D OHJLVODWLYH UROH ZHUH ZH WR UHDG  F DV      DFWLRQ XQGHU (5,6$ WR HQIRUFH LWV WHUPV  6HH  86&
PHDQLQJDQ\WKLQJRWKHUWKDQZKDWLWSODLQO\VD\V                         D%LLZKLFKSURYLGHVWKDWm>D@FLYLODFWLRQPD\
                                                                          EHEURXJKWE\DSDUWLFLSDQWEHQHILFLDU\RUILGXFLDU\
  7KHSRZHUWRFODLPDQH[HPSWLRQDIWHUDOOLVSHUVRQDOWR              WRREWDLQDSSURSULDWHHTXLWDEOHUHOLHIWRHQIRUFHWKH
WKH GHEWRU  6HH ,Q UH  1REOLW  )G   WK &LU   WHUPVRIWKHSODQl
,QUH(YHUKDUW%51'2KLR
      ,QUH<DWHV                                 1R      1R                                      ,QUH<DWHV        

   ,I RQH VXSSRVHG WKDW 'U <DWHV FRXOG REWDLQ MXGLFLDO     KHDOWKSODQWKHWHUPµSDUWLFLSDQWjDOVRLQFOXGHV>D@VHOI
HQIRUFHPHQW RI WKH WHUPV RI WKH SODQ XQGHU (5,6$ LQ WKH   HPSOR\HGLQGLYLGXDOLIVXFKLQGLYLGXDOLVRUPD\EHFRPH
6L[WK&LUFXLWKRZHYHURQHZRXOGEHZURQJ2XUSXEOLVKHG          HOLJLEOHWRUHFHLYHDEHQHILWXQGHUWKHSODQl86&
FDVHODZWHDFKHVWKDWmDVROHSURSULHWRURUVROHVKDUHKROGHURI      DG
D EXVLQHVV PXVW EH FRQVLGHUHG DQ HPSOR\HU DQG QRW DQ
HPSOR\HHRIWKHEXVLQHVVIRUSXUSRVHVRI(5,6$l)XJDULQR            7KHDSSHOODQWVjDGDUJXPHQW KDVDWOHDVWWZR
Y+DUWIRUG/LIH	$FFLGHQW,QV&R)GWK        REYLRXVIODZV
&LU   $V DQ mHPSOR\HUl D VROH VKDUHKROGHU FDQQRW
TXDOLI\DVDmSDUWLFLSDQWRUEHQHILFLDU\lLQDQ(5,6$SHQVLRQ          7KH<DWHVSURILWVKDULQJSODQLVQRWDJURXSKHDOWK
SODQ,G$JUDZDOY3DXO5HYHUH/LIH,QV&R)G            SODQDQG
WK &LU   7KH VROH VKDUHKROGHU mLV QRW DQ (5,6$
HQWLW\lLQRWKHUZRUGVDQGmGRHVQRWKDYHVWDQGLQJXQGHUWKH         WKHSXEOLVKHGGHFLVLRQLQ$JUDZDO o  ZKLFKLVQR
(5,6$ HQIRUFHPHQW PHFKDQLVPVl  $JUDZDO  )G DW               OHVV ELQGLQJ RQ WKLV  SDQHO WKDQ WKH SXEOLVKHG
                                                                      RSLQLRQLQ)XJDULQRoZDVLVVXHGVRPHWKUHHDQGD
                                                                          KDOI\HDUVDIWHUWKHHQDFWPHQWRIDG$QG
  ,QWKHLURSHQLQJEULHIRQDSSHDOWKHDSSHOODQWVDUJXHWKDW             VHH 6HFXULWLHV DQG ([FKDQJH &RPPLVVLRQ Y
WKH)XJDULQRGHFLVLRQGHSDUWVIURPDSODLQUHDGLQJRI(5,6$              sRKQVWRQ)GWK&LUDSRVW
FRQIOLFWVZLWKDGYLVRU\RSLQLRQVRIWKH'HSDUWPHQWRI/DERU              GHFLVLRQDFFHSWLQJWKHDUJXPHQWWKDWm(5,6$
DQGLVFRQWUDGLFWHGE\WKHFDVHODZRIHLJKWRWKHUFLUFXLWV%XW          GRHVQRWDSSO\WRDQ\>SURILWVKDULQJSHQVLRQ@SODQ
WKHVHDUJXPHQWVEHORQJLQDSHWLWLRQIRUUHKHDULQJHQEDQFWKH           WRWKHH[WHQWLWEHQHILWVWKHVROHRZQHURIDEXVLQHVV
WKUHH MXGJH SDQHO EHIRUH ZKLFK WKLV DSSHDO LV FXUUHQWO\           DQGKLVRUKHUVSRXVHl
SHQGLQJKDVQRDXWKRULW\WRRYHUUXOH)XJDULQR6HHWK&LU
5FZKLFKUHDGVDVIROORZV                                    8QGHUFLUFXLWSUHFHGHQWE\ZKLFKWKLVSDQHOLVERXQGLQ
                                                                    VKRUWLWLVFOHDUWKDWWKHVSHQGWKULIWFODXVHLQWKH<DWHVSURILW
    m5HSRUWHG SDQHO RSLQLRQV DUH ELQGLQJ RQ VXEVHTXHQW        VKDULQJSHQVLRQSODQLVQRWHQIRUFHDEOHE\'U<DWHVXQGHU
    SDQHOV7KXVQRVXEVHTXHQWSDQHORYHUUXOHVDSXEOLVKHG        (5,6$
    RSLQLRQRIDSUHYLRXVSDQHO&RXUWHQEDQFFRQVLGHUDWLRQ
    LVUHTXLUHGWRRYHUUXOHDSXEOLVKHGRSLQLRQRIWKHFRXUWl                                       %

7RWKHVDPHHIIHFWVHH9DOHQWLQHY)UDQFLV)G           1HLWKHU LV WKH VSHQGWKULIW FODXVH HQIRUFHDEOH XQGHU
WK&LU8QLWHG6WDWHVY'XQODS)G        7HQQHVVHHVWDWXWRU\ODZ7KH7HQQHVVHH3HUVRQDO3URSHUW\
WK&LU8QLWHG6WDWHVY:DVKLQJWRQ)G          2ZQHUjV5LJKWVDQG*DUQLVKPHQW$FWRIRQZKLFKWKH
WK&LUDQG8QLWHG6WDWHVY6PLWK         DSSHOODQWV UHO\ FRQWDLQV D VHFWLRQ SURYLGLQJ VXEMHFW WR DQ
)GWK&LU                                    H[FHSWLRQQRWUHOHYDQWKHUHDVIROORZV

  )LQDOO\WKHDSSHOODQWVDUJXHWKDW)XJDULQRZDVRYHUUXOHG           mDQ\ IXQGV RU RWKHU DVVHWV SD\DEOH WR D SDUWLFLSDQW RU
E\WKH +HDOWK,QVXUDQFH3RUWDELOLW\DQG$FFRXQWLQJ$FWRI            EHQHILFLDU\ IURP RU DQ\ LQWHUHVW RI DQ\ SDUWLFLSDQW RU
 ZKLFK HQDFWHG  86&  D  7KDW VHFWLRQ        EHQHILFLDU\LQDUHWLUHPHQWSODQZKLFKLVTXDOLILHGXQGHU
FDSWLRQHG m6SHFLDO UXOHV UHODWLQJ WR JURXS KHDOWK SODQVl      DDEDQG$RIWKH,QWHUQDO
SURYLGHVDPRQJRWKHUWKLQJVWKDWm>L@QWKH FDVHRIDJURXS           5HYHQXH&RGHRIDVDPHQGHGDUHH[HPSWIURP
                                                                      DQ\ DQG DOO FODLPV RI FUHGLWRUV RI WKH SDUWLFLSDQW RU