Court Opinion

ID: 2969804
Source: CourtListenerOpinion
Date Created: 2015-09-22 15:57:40.1905+00
Date Added: 2024-06-11T11:21:28.999662
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

 81,7(' 67$7(6 2) $0(5,&$        ;
          3ODLQWLII$SSHOOHH      
                                   
                                     1R
            Y                     
                                    !
                                   
 :,//,$0 0 /$1'+$0               
         'HIHQGDQW$SSHOODQW 
                                  1
       $SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW
     IRUWKH(DVWHUQ'LVWULFWRI.HQWXFN\DW$VKODQG
  1Rn+HQU\5:LOKRLWsU'LVWULFWsXGJH
                    $UJXHG2FWREHU
               'HFLGHGDQG)LOHG0D\
 %HIRUH68+5+(,15,&+DQG0225(&LUFXLWsXGJHV
             ('081'6'LVWULFWsXGJH
                       BBBBBBBBBBBBBBBBB
                             &2816(/
$5*8('0LFKDHOs&XUWLV&857,6/(*$/6(59,&(6
,1&$VKODQG.HQWXFN\IRU$SSHOODQW.HQQHWK57D\ORU
$66,67$1781,7('67$7(6$77251(</H[LQJWRQ

    
     7KH +RQRUDEOH 1DQF\ * (GPXQGV 8QLWHG 6WDWHV 'LVWULFW sXGJH IRU
WKH (DVWHUQ 'LVWULFW RI 0LFKLJDQ VLWWLQJ E\ GHVLJQDWLRQ

                                    
      8QLWHG6WDWHVY/DQGKDP                            1R        1R                      8QLWHG6WDWHVY/DQGKDP           

.HQWXFN\ IRU $SSHOOHH  21 %5,()  0LFKDHO s &XUWLV                                        ,,,&RQFOXVLRQ
&857,6/(*$/6(59,&(6,1&$VKODQG.HQWXFN\IRU
$SSHOODQW  .HQQHWK 5 7D\ORU &KDUOHV 3 :LVGRP sU                  (PRWLRQDOO\FKDUJHGODQJXDJHZKLFKLVWKHRQO\IRUPRI
$66,67$1781,7('67$7(6$77251(</H[LQJWRQ                                  GRPHVWLFDEXVHDWLVVXHLQWKLVFDVHLVDOPRVWLQHYLWDEOHLQWKH
.HQWXFN\IRU$SSHOOHH                                                      FRQWH[WRIGRPHVWLFUHODWLRQVGLVSXWHV'HWHUPLQLQJZKHWKHU
                                                                              WKDWODQJXDJHFURVVHVWKHILQHOLQHEHWZHHQSURWHFWHGVSHHFK
                        BBBBBBBBBBBBBBBBB                                     DQG WUXH WKUHDWV LV D GHOLFDWH TXHVWLRQ  'LVWULFW FRXUWV DQG
                                                                              SURVHFXWRUV PXVW WKHUHIRUH EH FDUHIXO QRW WR OHW WKH
                            23,1,21                                           SHUVRQDOLWLHV DQG LQWHUSHUVRQDO G\QDPLFV RI WKH SDUWLHV
                        BBBBBBBBBBBBBBBBB                                     LQWHUIHUHZLWKWKDWOHJDODQDO\VLV
                           ,,QWURGXFWLRQ                                     )RUDOOWKHIRUHJRLQJUHDVRQVZH5(9(56('HIHQGDQWjV
                                                                              FRQYLFWLRQVRQ&RXQWV7KUHH)RXUDQG)LYHDQG5(0$1'
   68+5+(,15,&+ &LUFXLW sXGJH  'HIHQGDQW :LOOLDP                       WRWKHGLVWULFWFRXUWZLWKLQVWUXFWLRQVWRHQWHUDMXGJPHQWRI
/DQGKDP ZDV FRQYLFWHG RI RQH FRXQW RI NQRZLQJO\                        DFTXLWWDODVWRDOOWKUHHFRXQWV
WUDQVPLWWLQJ D WKUHDW WR NLGQDS LQ LQWHUVWDWH FRPPHUFH LQ
YLRODWLRQRI86&F&RXQW7KUHHRQHFRXQWRI
NQRZLQJO\ WUDQVPLWWLQJ D WKUHDW WR LQMXUH LQ LQWHUVWDWH
FRPPHUFH DOVR LQ YLRODWLRQ RI  86&  F &RXQW
)RXUDQGRQHFRXQWRIPDNLQJLQWHUVWDWHWHOHSKRQHFDOOVWKDW
ZHUHOHZGLQGHFHQWREVFHQHDQGODVFLYLRXVZLWKWKHLQWHQW
WRDEXVHKDUDVVDQGDQQR\DQRWKHUSHUVRQLQYLRODWLRQRI
86&  D$ DQG % &RXQW )LYH  2Q DSSHDO
/DQGKDP DVVHUWV WKDW WKLV &RXUW VKRXOG UHYHUVH KLV
FRQYLFWLRQVEHFDXVHWKHGLVWULFWFRXUWDEXVHGLWVGLVFUHWLRQLQ
GHQ\LQJKLVPRWLRQWRGLVPLVVDVWR&RXQWV7KUHHDQG)RXUDV
KLV VWDWHPHQWV ZHUH QRW mWUXH WKUHDWVl DQG ZHUH WKHUHIRUH
FRQVWLWXWLRQDOO\SURWHFWHGVSHHFKXQGHUWKH)LUVW$PHQGPHQW
HUUHGLQGHQ\LQJKLVPRWLRQIRUMXGJPHQWRIDFTXLWWDODVWR
&RXQWV7KUHHDQG)RXUEHFDXVHKLVVWDWHPHQWVZHUHQRWmWUXH
WKUHDWVlHUUHGLQGHQ\LQJKLVPRWLRQIRUDFTXLWWDODVWR&RXQW
)LYHEHFDXVHKLVVWDWHPHQWVZHUHQRWREVFHQHDQGDEXVHGLWV
GLVFUHWLRQLQDOORZLQJWKH*RYHUQPHQWWRLQWURGXFHHYLGHQFH
RI SULRU EDG DFWV  /DQGKDP IXUWKHU DOOHJHV WKDW WKH
*RYHUQPHQWYLRODWHGKLV)LIWK$PHQGPHQWULJKWDJDLQVWVHOI
LQFULPLQDWLRQ E\ FRPPHQWLQJ GXULQJ FORVLQJ DUJXPHQW RQ

    
     &3/07  WKH FXUUHQW YHUVLRQ RI WKH VWDWXWH VXEVHFWLRQV $ DQG % DUH
FRQWDLQHG LQ $ $00  86&$  D :HVW 6XSS 
    8QLWHG6WDWHVY/DQGKDP                      1R       1R                     8QLWHG6WDWHVY/DQGKDP          

  ZKHWKHUWKH>VWDWHPHQW@GHSLFWVRUGHVFULEHVLQDSDWHQWO\         /DQGKDPjV VLOHQFH  )RU WKH IROORZLQJ UHDVRQV ZH
  RIIHQVLYHZD\VH[XDOFRQGXFWVSHFLILFDOO\GHILQHGE\WKH           5(9(56(DOOWKUHHFRQYLFWLRQV
  DSSOLFDEOH VWDWH ODZ DQG F ZKHWKHU WKH >VWDWHPHQW@
  WDNHQDVDZKROHODFNVVHULRXVOLWHUDU\DUWLVWLFSROLWLFDO                              ,,%DFNJURXQG
  RUVFLHQWLILFYDOXHl
                                                                        /DQGKDPjV FRQYLFWLRQV DULVH RXW RI KLV WHPSHVWXRXV
  ,GDW                                                          UHODWLRQVKLSZLWK%HOLWD$GDPV,Q/DQGKDPDQDFWRU
                                                                      PHW$GDPVDQDVSLULQJPRGHOLQ1HZ<RUN&LW\/DQGKDP
   7KH*RYHUQPHQWIDLOHGWRHVWDEOLVKWKDW/DQGKDPjVSKRQH            ZDVDERXWIRUW\WZR\HDUVROG$GDPVZDVQLQHWHHQ7KHWZR
FDOOV ZHUH REVFHQH FRPPXQLFDWLRQV  ,Q KLV SKRQH FDOOV       EHFDPH URPDQWLFDOO\ LQYROYHG DQG $GDPV PRYHG WR /RV
/DQGKDPPDGHFRPPHQWVVXFKDVmKHUSHVVOXWlmFXQWOHVV               $QJHOHVZLWK/DQGKDP
IXFNlDQGmXQPRWKHUO\SLHFHRIFUDSl7KHVHFRPPHQWVDUH
DGPLWWHGO\mOHZGODVFLYLRXVILOWK\RULQGHFHQWlD          $GDPV FKDUDFWHUL]HG WKH UHODWLRQVKLS DV mYHU\ VWRUP\l
%XW WKH\ DUH QRW REVFHQH  /DQGKDPjV VWDWHPHQWV ZHUH          mIDVWSDFHGl DQG ZLWK mD ORW RI GUXJ DQG DOFRKRO DEXVHl
LQYHFWLYHVKHZDVVZHDULQJYXOJDUO\DWKLVZLIHEHFDXVHKH         $GDPVWHVWLILHGWKDW/DQGKDPEHFDPHRIIHQVLYHDQGYRODWLOH
ZDVIUXVWUXDWHGZLWKWKHLUUHODWLRQVKLS,WFRXOGKDUGO\EHVDLG     ZKHQKHZDVXQGHUWKHLQIOXHQFHRIHLWKHUDOFRKRORUGUXJV
WKDW /DQGKDPjV FRPPHQWV ZRXOG DSSHDO WR WKH SUXULHQW           +RZHYHU VKH DOVR WHVWLILHG WKDW /DQGKDP QHYHU KLW KHU
LQWHUHVWRIWKHDYHUDJHSHUVRQ6HH8QLWHG6WDWHVY'DUVH\         WKURXJKRXW WKHLU HQWLUH UHODWLRQVKLS  $GDPV VWDWHG WKDW
 ) 6XSS   (' 3D  QRWLQJ WKDW m>W@KH   /DQGKDPZDVmYHU\PXFKGLIIHUHQWlZKHQ KHZDVVREHUo
OHJLVODWLYHKLVWRU\RI>SULRUYHUVLRQRI$@PDNHVLW         mYHU\SHUVRQDEOHlmYHU\LQWHOOLJHQWl
FOHDUWKDW$ZDVSRLQWHGDWWKHSUREOHPRIZKDWLV
JHQHUDOO\ DQG FROORTXLDOO\ XQGHUVWRRG WR EH DQ mREVFHQH          7KHUHODWLRQVKLSLQ/RV$QJHOHVODVWHGDERXWWZRDQGRQH
WHOHSKRQHFDOOlWKDWLVDYHUEDOVH[XDORUVDGRVH[XDODVVDXOW      KDOI \HDUV EXW LW ZDV mYHU\ RQ DQG RII GXULQJ WKDW ZKROH
PDGHRYHUWKHWHOHSKRQHIRUWKHSHUYHUWHGSOHDVXUHGHULYHG            SHULRGl$WRQHSRLQWDIWHU/DQGKDPVKRWDSLVWROSDVWKHU
IURPLW>DQGQRW@WRPDNHFULPLQDOWKHXVHRIXQJHQWHHORU      KHDG$GDPVPRYHGRXW7KH\PDLQWDLQHGDQRQDJDLQRII
YXOJDUODQJXDJHVRPHWLPHVFDOOHGmREVFHQHlLQWKHFRXUVHRI           DJDLQUHODWLRQVKLSKRZHYHU
DQLQWHUVWDWHWHOHSKRQHFRQYHUVDWLRQHLWKHUIURPKDELWDQJHU
RUVODQGHURXVLQWHQWl6HHJHQHUDOO\6DEOH&RPPXQLFDWLRQV             $GDPVPRYHGDZD\LQRUDQGKDGQRFRQWDFW
RI&DOLIRUQLD,QFY)&&86mVH[XDO         ZLWK /DQGKDP XQWLO   2Q )HEUXDU\   $GDPVj
H[SUHVVLRQZKLFKLVLQGHFHQWEXWQRWREVFHQHLVSURWHFWHGE\          IDWKHU D VFKRRO VXSHULQWHQGHQW LQ )ORULGD ZDV NLOOHG E\ D
WKH )LUVW $PHQGPHQWl  7KXV XQGHU $SROORPHGLD                GLVJUXQWOHGHPSOR\HH$GDPVjIDWKHUZDVVKRWZLWKDILYH
/DQGKDPjV VWDWHPHQWV DUH QRW D YLRODWLRQ RI  D         VKRW 7DXUXV SLVWRO D IDFW ZKRVH VLJQLILFDQFH ZLOO EHFRPH
7KHUHIRUHZHUHYHUVHDQGUHPDQGWRWKHGLVWULFWFRXUWWRHQWHU       DSSDUHQWVKRUWO\$IWHUWKHVKRRWLQJ$GDPVGHFLGHGWRPRYH
DMXGJPHQWRIDFTXLWWDODVWR&RXQW)LYH                             ZLWKKHUGDXJKWHU5DFKHOZKRZDVQRWIDWKHUHGE\/DQGKDP
                                                                      WRWKHIDPLO\IDUPLQ.HQWXFN\,QHDUO\$GDPVVSRNH
  *LYHQRXUGLVSRVLWLRQRI&RXQWV7KUHH)RXUDQG)LYHZH           ZLWK/DQGKDPDQGWKHWZRDJUHHGWRPHHW/DQGKDPIOHZWR
QHHGQRWDGGUHVV/DQGKDPjVUHPDLQLQJLVVXHV                        .HQWXFN\$GDPVVWDWHGWKDW/DQGKDPZDVmYHU\YHU\QLFHl
                                                                      DQGWKDWKHLQGLFDWHGWKDWKHZDVQRORQJHUGULQNLQJ
                                                                       ,QWKHVSULQJRI$GDPVDQG/DQGKDPDJUHHGWRVKRRW
                                                                      DPRWLRQSLFWXUHWRJHWKHULQ&DQDGD$GDPVDQGKHUPRWKHU
     8QLWHG6WDWHVY/DQGKDP                        1R       1R                      8QLWHG6WDWHVY/DQGKDP           

*OHQGD$GDPVKDGLQKHULWHGZKLFKWKH\LQYHVWHG               YRWHVRQWKHPHULWVRIDFDVHm2KLRH[UHO(DWRQY
LQWKHILOP$GDPVZDVWKHH[HFXWLYHSURGXFHUDQG/DQGKDP              3ULFH86+LFNVY0LUDQGD86
ZDVWKHGLUHFWRU$GDPVGHVFULEHGWKHILOPDVDORZEXGJHW               TXRWLQJ (DWRQ VHH DOVR 5s 5H\QROGV
HURWLFDFWLRQDGYHQWXUH$GDPVWHVWLILHGWKDW/DQGKDPGUDQN            7REDFFRY'XUKDP&RXQW\86Q
KHDYLO\GXULQJILOPLQJ                                                 sDPHV :P 0RRUH HW DO 0225(j6 )('(5$/
                                                                        35$&7,&(>@GHGm7KH6XSUHPH&RXUW
  /DQGKDPDQG$GDPVDOVREHJDQVHHLQJHDFKRWKHUDJDLQ                 WUHDWVLWVRZQVXPPDU\DIILUPDQFHRIDQDSSHDOIURPDWKUHH
$IWHUWKHILOPLQJZKLOHEDFNRQWKHIDUPLQ2FWREHU              MXGJHGLVWULFWFRXUWDVSUHFHGHQWWREHIROORZHGl:HDUH
/DQGKDPWKUHDWHQHG$GDPVZLWKDNQLIH$GDPVWHVWLILHG                 WKHUHIRUH ERXQG E\ WKH WKUHHMXGJH GLVWULFW KROGLQJ LQ
WKDW/DQGKDPSRLQWHGWKHNQLIHDWKHUDQGVWDWHGmLI\RXZDQW          $SROORPHGLD
WRSXVKP\EXWWRQVOLNH2sGLG1LFROH\RXNQRZDQGWKHQ
VDLGWKDWLI\RXZDQWWRSOD\1LFROHGR\RXZDQWPHWRSOD\               $SROORPHGLD LQYROYHG FRPPHUFLDO FRPPXQLFDWLRQV QRW
2sl  $V D UHVXOW $GDPV REWDLQHG D 'RPHVWLF 9LROHQFH         SXUHO\SULYDWHVSHHFKDVLQWKLVFDVH+RZHYHUEHFDXVHWKH
2UGHU m'92l RQ 2FWREHU   ZKLFK RUGHUHG                 VWDWXWH EDQV RQO\ REVFHQH VSHHFK ZKLFK LV QRW SURWHFWHG
/DQGKDPWRKDYHQRFRQWDFWZLWK$GDPV/DQGKDPGLGQRW                 WKHUHLVQRLPSHGLPHQWWRDSSO\LQJLWWRSXUHO\SULYDWHVSHHFK
FRQWHVWWKHDOOHJDWLRQV+HLPPHGLDWHO\YLRODWHGWKH'92E\            6HH5HQRY$PHULFDQ&LYLO/LEHUWLHV8QLRQ86
PDNLQJUHSHDWHGSKRQHFDOOV                                           Q  VWDWLQJ WKDW LWV GHFLVLRQ KROGLQJ
                                                                        XQFRQVWLWXWLRQDO IHGHUDO VWDWXWH SURKLELWLQJ mLQGHFHQW
  6KRUWO\ WKHUHDIWHU LQ 1RYHPEHU  $GDPV EHFDPH              WUDQVPLVVLRQl RYHU WKH ,QWHUQHW KDG QR HIIHFW RQ ODZV
SUHJQDQW ZLWK /DQGKDPjV FKLOG  2Q 'HFHPEHU              SURKLELWLQJWUDQVPLVVLRQRIREVFHQLW\5RWK86DW
$GDPVPRYHGWRUHPRYHWKHILUVW'92LQLWVHQWLUHW\VWDWLQJ            m>2@EVFHQLW\ LV QRW ZLWKLQ WKH DUHD RI FRQVWLWXWLRQDOO\
WKDW VKH DQG /DQGKDP mKDYH D EXVLQHVV UHODWLRQVKLS WKDW         SURWHFWHGVSHHFKl7KHUHIRUHZHZLOODVVXPHIRUSXUSRVHV
UHTXLUHV GDLO\ FRPPXQLFDWLRQV DQG RFFDVLRQDO EXVLQHVV              RIWKLVFDVHEHFDXVHLWXOWLPDWHO\PDNHVQRGLIIHUHQFHWRWKH
PHHWLQJVl  $GDPV PDUULHG /DQGKDP LQ 'HFHPEHU               RXWFRPHKHUHWKDW$SROORPHGLDDOVRDSSOLHVWRSXUHO\SULYDWH
7KHLUGDXJKWHU3ULVFLOODZDVERUQRQ$XJXVW                  LQWHUVWDWHFRPPXQLFDWLRQV
  2Q 1RYHPEHU   $GDPV REWDLQHG D VHFRQG '92                7KXVWKHTXHVWLRQEHFRPHVZKHWKHUWKHVSHHFKLVREVFHQH
ZKHQ/DQGKDPWROG$GDPVjPRWKHUWKDWLIKHKDGDJXQKH                7KH6XSUHPH&RXUWLQ0LOOHUY&DO86VHW
ZRXOGNLOO$GDPV,QDGGLWLRQ/DQGKDPWKUHDWHQHG$GDPV                IRUWKWKHWHVWWRGHWHUPLQHZKDWLVREVFHQH7KH&RXUWVWDWHG
E\ VD\LQJ mGRQjW PDNH PH LQWR D %XWFK 0RQURH sUl D        WKDW
UHIHUHQFHWRDPDQZKRZUHFNHGKLVFDUWKHQLJKWKHDQGKLV
JLUOIULHQG VSOLW XS  $GDPV WHVWLILHG WKDW /DQGKDP ZRXOG          >W@KH EDVLF JXLGHOLQHV IRU WKH WULHU RI IDFW PXVW EH D
PDNHMRNHVDERXWHYHU\WKLQJ0RQURHZDVJRLQJWRGRWRWKH                 ZKHWKHU WKH µDYHUDJH SHUVRQ DSSO\LQJ FRQWHPSRUDU\
H[JLUOIULHQG $JDLQ /DQGKDP IDLOHG WR DSSHDU WR FRQWHVW          FRPPXQLW\VWDQGDUGVjZRXOGILQGWKDWWKH>VWDWHPHQW@
WKHVHDOOHJDWLRQV$GDPVDOVRILOHGIRUGLYRUFHDWWKLVWLPH           WDNHQDVDZKROHDSSHDOVWRWKHSUXULHQWLQWHUHVWE
  1RWZLWKVWDQGLQJRQ1RYHPEHU$GDPVHQWHUHG
LQWRDQRWKHUDJUHHGRUGHURIUHFRQFLOLDWLRQDQGDOVRVWRSSHG               
WKH GLYRUFH DFWLRQ  2QH RI WKH WHUPV RI WKH UHFRQFLOLDWLRQ         :H QRWH WKDW  D DSSHDUV WR DSSO\ WR ERWK SULYDWH DQG SXEOLF
                                                                        FRPPXQLFDWLRQV     6XEVHFWLRQ D LV HQWLWOHG m3URKLELWHG JHQHUDO
RUGHUZDVWKDW$GDPVZRXOGUHWDLQFXVWRG\RI3ULVFLOODGXULQJ           SXUSRVHVl DQG VXEVHFWLRQ E LV HQWLWOHG m3URKLELWHG FRPPHUFLDO
WKHSHULRGRIUHFRQFLOLDWLRQ                                           SXUSRVHV GHIHQVH WR SURVHFXWLRQl
     8QLWHG6WDWHVY/DQGKDP                              1R         1R                    8QLWHG6WDWHVY/DQGKDP          

FRPPXQLFDWLRQVWKDWDUHµLQGHFHQWjDVRSSRVHGWRRQO\WKRVH                        $GDPV REWDLQHG D WKLUG DQG ILQDO '92 RQ sDQXDU\ 
WKDWDUHµREVFHQHjl,GDW7KHGLVWULFWFRXUWDQDORJL]HG                7KLV'92SHWLWLRQDOOHJHGWKDWRQsDQXDU\
WKH mVWULQJ RI ZRUGVl LQ  D$ o mREVFHQH OHZG               /DQGKDPWROG$GDPVmWKDWWKHFKLOGUHQZRXOGEHEHWWHURII
ODVFLYLRXVILOWK\RULQGHFHQWloWRWKHVWULQJRIZRUGVXVHGLQ                 GHDGWKDQKDYLQJDSV\FKRWLFPRWKHUlDQGWKDWmFXQWVOLNH
86&omREVFHQHOHZGODVFLYLRXVRUILOWK\lo                       \RXQHHGDEXOOHWEHWZHHQWKHH\HVl/DQGKDPZDVUHPRYHG
ZKLFKWKH6XSUHPH&RXUWLQDOLQHRIFDVHVUHDGWRSURVFULEH                     IURP WKH KRPH DQG RUGHUHG WR KDYH QR FRQWDFW  7KH WKLUG
RQO\PDWHULDOFRQWDLQLQJmREVFHQLW\l,GDWFLWLQJ                   '92VWDWHVWKDW5HVSRQGHQWmEHUHVWUDLQHGIURPDQ\FRQWDFW
5RWKY8QLWHG6WDWHV860DQXDO(QWHUSU                     RUFRPPXQLFDWLRQZLWKWKHDERYHQDPHG3HWLWLRQHU>%HOLWD
,QF Y 'D\  86   DQG +DPOLQJ Y 8QLWHG                /DQGKDP@>@E\UHPDLQLQJDWDOOWLPHVDQGSODFHVDWOHDVW
6WDWHV867KH$SROORPHGLDFRXUWDOVR                       IHHWDZD\IURPSHWLWLRQHUDQGPHPEHUVRI3HWLWLRQHUjVIDPLO\
IRXQGVLJQLILFDQFHLQWKHIDFWWKDWWKLVLQWHUSUHWDWLRQSUHYDLOHG               RUKRXVHKROGl,WDZDUGHGWHPSRUDU\FXVWRG\RI3ULVFLOODWR
DWWKHWLPHDjVSUHGHFHVVRUVWDWXWHZDVHQDFWHG,GDW                  $GDPVDQGRUGHUHG/DQGKDPWRSD\DPRQWKLQFKLOG
QRWLQJWKDWLWLVDQHVWDEOLVKHGUXOHRIVWDWXWRU\                VXSSRUW$GDPVDOVRILOHGIRUGLYRUFHDJDLQ
FRQVWUXFWLRQ WKDW &RQJUHVV LV SUHVXPHG WR EH WKRURXJKO\
IDPLOLDUZLWK6XSUHPH&RXUWSUHFHGHQWDQGWKDWLWH[SHFWVLWV                      $GDPVWHVWLILHGWKDWGHVSLWHWKH'92/DQGKDPFDOOHGDQG
HQDFWPHQWV WR EH LQWHUSUHWHG LQ FRQIRUPLW\ WKHUHZLWK                     ID[HG KHU GRFXPHQWV  6KH VWDWHG WKDW KH DOVR ID[HG
)LQDOO\WKHFRXUWIRXQGWKDWWKHOHJLVODWLYHKLVWRU\ZDVODUJHO\                GRFXPHQWVWRDQXPEHURISHRSOHLQWKHFRPPXQLW\LQFOXGLQJ
FRQVLVWHQWZLWKWKLVYLHZ,GDW                                     WKH HOHPHQWDU\ VFKRRO SULQFLSDO $GDPVj PRWKHU DQG WKH
                                                                                 FRXUW,QWKHVHGRFXPHQWVKHDFFXVHG$GDPVRIIUDXGDQG
   3XUVXDQWWR6HFWLRQRI3XE/DQDPHQGPHQW                      FKLOG DEXVH DPRQJ RWKHU WKLQJV  $GDPV WHVWLILHG WKDW
WR86&$SSROORPHGLDILOHGDGLUHFWDSSHDOWRWKH                    /DQGKDP PDGH QXPHURXV SKRQH FDOOV WKDW ODVWHG IURP
6XSUHPH &RXUW ZKLFK DIILUPHG ZLWKRXW VHSDUDWH RSLQLRQ                    sDQXDU\WKURXJKsXQH6KHDOVRVWDWHGWKDWVKHGLGQRWNQRZ
6HH:/DPHQGHGE\86                           ZKHUH/DQGKDPZDVOLYLQJGXULQJWKLVWLPH
  m9RWHV WR DIILUP VXPPDULO\ DQG WR GLVPLVV IRU ZDQW RI                   *OHQGD$GDPV%HOLWDjVPRWKHUDOVRREWDLQHGWZR'92V
VXEVWDQWLDO IHGHUDO TXHVWLRQ LW KDUGO\ QHHGV FRPPHQW DUH                DJDLQVW/DQGKDPRQHLQDQGDQRWKHULQ7KHVH
                                                                                 ZHUHDOVRSUHVHQWHGLQWRHYLGHQFHE\WKH*RYHUQPHQW,QWKH
                                                                                 ILUVW*OHQGD$GDPVDOOHJHGWKDW/DQGKDPWROG*OHQGDWKDWKH
     
                                                                          ZRXOGVKRRW%HOLWDLIKHKDGDJXQ,QWKHVHFRQGHQWHUHGRQ
       ,Q 5RWK Y 8QLWHG 6WDWHV  86   WKH 6XSUHPH &RXUW
UHDG WKH WHUPV mREVFHQH OHZG ODVFLYLRXV RU ILOWK\l LQ  86&          0D\/DQGKDPZDVRUGHUHGWRKDYHQRFRQWDFWZLWK
ZKLFK LPSRVHG FULPLQDO SHQDOWLHV IRU NQRZLQJ XVH RI WKH PDLOV WR                 *OHQGD$GDPV
WUDQVSRUW mREVFHQH OHZG ODVFLYLRXV RU ILOWK\ ERRN SDPSKOHW SLFWXUH
SDWSHU OHWWHU ZULWLQJ SULQW RU RWKHU SXEOLFDWLRQ RI DQ LQGHFHQW FKDUDFWHUl
WR UHIHU VROHO\ WR mREVFHQLW\l ,Q 0DQXDO (QWHUSULVHV ,QF Y 'D\ 
                                                                                   2Q$XJXVW3ULVFLOODjVVHFRQGELUWKGD\DWD[LFDE
 WKH 6XSUHPH &RXUW UHDIILUPHG WKLV FRQVWUXFWLRQ REVHUYLQJ WKDW
                                                                                 DUULYHGZLWKJLIWVIURP/DQGKDP7KHVWRUHWDJVLQGLFDWHG
m>Z@KLOH LQ FRPPRQ XVDJH WKH ZRUGV KDYH GLIIHUHQW VKDGHV RI PHDQLQJ             WKDW WKH SUHVHQWV ZHUH SXUFKDVHG ORFDOO\  /DQGKDP ZDV
WKH VWDWXWH VLQFH LWV LQFHSWLRQ KDV EHHQ DLPHG DW REQR[LRXVO\ GHEDVLQJ           DUUHVWHG RQ $XJXVW   DW KLV DWWRUQH\jV RIILFH LQ
SRUWUD\DOV RI VH[l ,G DW  ,Q +DPOLQJ Y 8QLWHG 6WDWHV  86         .HQWXFN\$GDPVGLGQRWDFWXDOO\VHH/DQGKDPDJDLQXQWLO
  WKH 6XSUHPH &RXUW UHMHFWHG D YDJXHQHVV FKDOOHQJH WR  
KROGLQJ WKDW WKH WHUPV IRXQG LQ WKH VHULRXV RI ZRUGV ZHUH mOLPLWHG WR WKH
                                                                                 WKHGLYRUFHKHDULQJDIHZGD\VODWHURQ$XJXVW
VRUW RI SDWHQWO\ RIIHQVLYH UHSUHVHQWDWLRQV RU GHVFULSWLRQV RI WKDW VSHFLILF
µKDUG FRUHj VH[XDO FRQGXFW JLYHQ DV H[DPSOHV LQ 0LOOHU Y &DOLIRUQLDl ,G
                                                                                   2Q$XJXVWDIHGHUDOJUDQGMXU\UHWXUQHGDIRXU
DW  Q                                                                      FRXQWLQGLFWPHQWDJDLQVW/DQGKDP2Q2FWREHUD
       8QLWHG6WDWHVY/DQGKDP                          1R        1R                        8QLWHG6WDWHVY/DQGKDP           

VL[FRXQW VXSHUVHGLQJ LQGLFWPHQW ZDV UHWXUQHG  /DQGKDP                                            &RXQW)LYH
ZDVFKDUJHGZLWKFURVVLQJVWDWHOLQHVZLWKLQWHQWWRYLRODWH
WKH WHUPV RI D GRPHVWLF YLROHQFH RUGHU LQ YLRODWLRQ RI            &RXQW )LYH FKDUJHG /DQGKDP ZLWK YLRODWLQJ  86&
86&   &RXQW 2QH  FURVVLQJ VWDWH OLQHV ZLWK             D$	% IRU WUDQVPLWWLQJ LQWHUVWDWH
LQWHQWWRLQMXUHDQGKDUDVVLQYLRODWLRQRI86&$               FRPPXQLFDWLRQVEHWZHHQsDQXDU\ DQGsXO\WKDW
&RXQW 7ZR  NQRZLQJO\ WUDQVPLWWLQJ LQ LQWHUVWDWH                  ZHUHOHZGLQGHFHQWREVFHQHDQGODVFLYLRXVZLWKLQWHQWWR
FRPPHUFH D WKUHDW WR NLGQDS LQ YLRODWLRQ RI  86&              DEXVHKDUDVVDQGDQQR\6HFWLRQDPDNHVLWDFULPHWR
 F &RXQW 7KUHH  NQRZLQJO\ WUDQVPLWWLQJ LQ                 PDNH FUHDWH RU VROLFLW DQG LQLWLDWH WKH WUDQVPLVVLRQ LQ
LQWHUVWDWH FRPPHUFH D WKUHDW WR LQMXUH LQ YLRODWLRQ RI           LQWHUVWDWH FRPPHUFH mDQ\ FRPPHQW UHTXHVW VXJJHVWLRQ
86&  F &RXQW )RXU  WUDQVPLWWLQJ LQWHUVWDWH             SURSRVDOLPDJHRURWKHUFRPPXQLFDWLRQZKLFKLVREVFHQH
FRPPXQLFDWLRQV WKDW ZHUH OHZG LQGHFHQW REVFHQH DQG                  OHZG ODVFLYLRXV ILOWK\ RU LQGHFHQW ZLWK LQWHQW WR DQQR\
ODVFLYLRXVZLWKLQWHQWWRDEXVHKDUDVVDQGDQQR\LQYLRODWLRQ             DEXVH WKUHDWHQ RU KDUDVV DQRWKHU SHUVRQl   86&$
RI86&D&RXQW)LYHDQGPDNLQJUHSHDWHG                  D:HVW6XSS/DQGKDPDUJXHVWKDWD
LQWHUVWDWHWHOHSKRQHFDOOVVROHO\WRKDUDVVLQYLRODWLRQRI              UHTXLUHVWKDWWKHFRPPXQLFDWLRQEHmREVFHQHlDQGWKDWWKH
86&$(&RXQW6L[                                            *RYHUQPHQWIDLOHGWRHVWDEOLVKWKLVHOHPHQW:HDJUHHRQ
                                                                             ERWKIURQWV
  /DQGKDP SOHDGHG QRW JXLOW\  3ULRU WR WULDO KH PRYHG
SUR VH WR mGURS DOO FKDUJHVl  $V JURXQGV IRU KLV PRWLRQ           2XUDQDO\VLVRIDLVFRQWUROOHGE\$SROORPHGLD&RUS
/DQGKDP DUJXHG WKDW  KH ZDV QRW VXEMHFW WR IHGHUDO               Y5HQR)6XSSG1'&DODIIjG
MXULVGLFWLRQ EHFDXVH KH LV D .HQWXFN\ UHVLGHQW DQG ZDV               :/DPHQGHGE\867KH8QLWHG6WDWHV
HQWLWOHGWRGULYHLQWKHVWDWHKDUDVVLQJSKRQHFDOOVmGRQRW            6XSUHPH&RXUWVXPPDULO\DIILUPHGWKHWKUHHMXGJHSDQHOjV
YLRODWHWKHIHGHUDOODZDVZULWWHQlDQGWKDWKLVDFFXVHULV             KROGLQJ WKDW  86&   LV OLPLWHG WR SURVFULELQJ
mDFKLOGDEXVHUZLWKVHYHUHPHQWDOSUREOHPVDSHUMXULHU>VLF@              ODQJXDJHWKDWLVmREVFHQHlHYHQWKRXJKWKHSODLQODQJXDJHRI
DQG D FRQYLFWHG OLHU >VLF@l  7KH GLVWULFW FRXUW VXPPDULO\          WKHVWDWXWHDOVRSURKLELWVFRPPXQLFDWLRQVZKLFKDUHmOHZG
RYHUUXOHG WKH PRWLRQ  /DQGKDP VXEVHTXHQWO\ REWDLQHG                  ODVFLYLRXVRULQGHFHQWl,GDW
FRXQVHO
                                                                               7KHSODLQWLII$SROORPHGLDFKDOOHQJHGWKHFRQVWLWXWLRQDOLW\
   7KH*RYHUQPHQWILOHGDQRWLFHXQGHU)HG5(YLGE                  RI  D$LL DQG D RQ WKH JURXQGV WKDW WR WKH
WR LQWURGXFH mSULRU EDG DFWVl HYLGHQFH  7KH *RYHUQPHQW              H[WHQWWKH\SURKLELWmLQGHFHQWlFRPPXQLFDWLRQVPDGHmZLWK
VRXJKW WR LQWURGXFH SULRU '92V DQG WHVWLPRQ\ UHJDUGLQJ               DQ LQWHQW WR DQQR\l WKH\ YLRODWHG WKH )LUVW $PHQGPHQW DV
WKHLUVXUURXQGLQJFLUFXPVWDQFHV/DQGDPjVGLVFKDUJLQJRID                   YDJXHDQGRYHUEURDG7KHORZHUFRXUWFKDUDFWHUL]HGWKHLVVXH
ILUHDUPLQ/DQGKDPjVVXEVWDQFHDEXVHSUREOHPKLV                     DV mZKHWKHU  D$LL DQG  D SURVFULEH
FRQGXFWLQDGLYRUFHSURFHHGLQJDQGKLVIDLOXUHWRSD\FKLOG
VXSSRUW/DQGKDPREMHFWHGWRWKHEHYLGHQFHDUJXLQJ
WKDWLWZDVLQDGPLVVLEOHFKDUDFWHUHYLGHQFH+HDOVRDVVHUWHG                   
                                                                                 ,W LV ZHOOVHWWOHG WKDW REVFHQH VSHHFK LV QRW SURWHFWHG E\ WKH )LUVW
                                                                             $PHQGPHQW 5RWK Y 8QLWHG 6WDWHV  86   

                                                                                
     6SHFLILFDOO\ WKH GLVWULFW VWDWHG WKDW mKDYLQJ FRQVLGHUHG 'HIHQGDQWjV         3XUVXDQW WR  86&   DQG  D RI WKH &RPPXQLFDWLRQV
PRWLRQ DQG WKH UHFRUG DQG EHLQJ VXIILFLHQWO\ DGYLVHG ,7 ,6 +(5(%<          'HFHQF\ $FW  86&  D D GLVWULFW FRXUW RI WKUHH MXGJHV VKDOO EH
25'(5(' $1' $'s8'*('  WKDW 'HIHQGDQWjV SUR VH PRWLRQ WR                  FRQYHQHG ZKHQ WKH FRQVWLWXWLRQDOLW\ RI DQ\ SURYLVLRQ RI WKH &'$ LV
m'URS $OO &KDUJHVl LV 29(558/('l                                            FKDOOHQJHG
       8QLWHG6WDWHVY/DQGKDP                          1R        1R                   8QLWHG6WDWHVY/DQGKDP         

/DQGKDP KDG HYHU DWWHPSWHG WR UHPRYH 3ULVFLOOD IURP WKH               WKDWWKHILUHDUPVHYLGHQFHZDVQRWVXEVWDQWLDOO\VLPLODUDQG
IDPLO\UHVLGHQFH0RVWVLJQLILFDQWO\$GDPVGLGQRWFDOOWKH                WRR GLVWDQW LQ WLPH IURP WKH FKDUJHG FRQGXFW  $IWHU DQ
SROLFHDIWHUVKHUHFHLYHGWKLVFDOOGHVSLWHWKHIDFWWKDWVKHKDG            HYLGHQWLDU\ KHDULQJ WKH GLVWULFW FRXUW VXPPDULO\ RYHUUXOHG
DQ HQIRUFHDEOH RUGHU EDQQLQJ /DQGKDP IURP DOO                           /DQGKDPjVREMHFWLRQVWRWKH*RYHUQPHQWjVEHYLGHQFH
FRPPXQLFDWLRQ DQG WKH IDFW WKDW LQ WKH SDVW VKH GLG QRW          H[FHSWDVWRWKHGLVFKDUJLQJRIDILUHDUPZKLFKLWLQLWLDOO\
KHVLWDWH WR VHHN SROLFH SURWHFWLRQ ZKHQ VKH ZDV DOOHJHGO\             WRRNXQGHUDGYLVHPHQW7KHGLVWULFWFRXUW ODWHUHQWHUHGDQ
DIUDLGRI/DQGKDP7KXVWKHHYLGHQFHUHYHDOVWKDW$GDPV                    RUGHU RYHUUXOLQJ /DQGKDPjV REMHFWLRQ WR WKH ILUHDUPV
KHUVHOIGLGQRWSHUFHLYHWKH)HEUXDU\FRPPXQLFDWLRQ                   HYLGHQFH
DVDWUXHWKUHDWWRNLGQDS,QRWKHUZRUGVDUDWLRQDOWULHURI
IDFWFRXOGQRWKDYHIRXQG/DQGKDPJXLOW\RIWKLVFRXQW7KH                     $WWULDOWKH*RYHUQPHQWLQWURGXFHGWKHIRUHJRLQJEDGDFWV
GLVWULFWFRXUWHUUHGLQIDLOLQJWRJUDQW/DQGKDPjVPRWLRQIRU                 HYLGHQFHDVZHOODVWDSHVRIDSSUR[LPDWHO\ILIW\SKRQHFDOOV
MXGJPHQWRIDFTXLWWDODVWRWKLVFRXQW                                       /DQGKDPSODFHGWR$GDPVEHWZHHQsDQXDU\DQGsXQH
                                                                              7KH H[DFW GDWHV DQG WLPHV RI DOO /DQGKDPjV FDOOV ZHUH
                            &RXQW)RXU                                     XQNQRZQ  +RZHYHU UHFHLSWV IRXQG LQ /DQGKDPjV YHKLFOH
                                                                              HVWDEOLVKHG WKDW EHWZHHQ sDQXDU\  DQG sXQH  KH
   $VGLVFXVVHGDERYHWKHVWDWHPHQWDWLVVXHLQ&RXQW)RXULV                WUDYHOHGIURP.HQWXFN\WR*HRUJLD,OOLQRLV,QGLDQDDQGEDFN
QRWDWKUHDWDQGVKRXOGKDYHEHHQGLVPLVVHGRQ/DQGKDPjV                      WR*HRUJLD,QDGGLWLRQRQWZRRFFDVLRQVGXULQJWKLVSHULRG
PRWLRQ1RWZLWKVWDQGLQJWKH*RYHUQPHQWDUJXHVWKDWWDNHQ                   KH OHIW D &KLFDJR ,OOLQRLV WHOHSKRQH QXPEHU  0RUH
LQFRQWH[WWKHVWDWHPHQWZDVFOHDUO\DWKUHDWEHFDXVH$GDPV                  LPSRUWDQWO\ $JHQW <YRQQH :DUQHU ZKR LQWHUYLHZHG
WHVWLILHGWKDW/DQGKDPRIWHQJRWKLVWHQVHVMXPEOHGZKHQKH                   /DQGKDPWHVWLILHGWKDW/DQGKDPWROGKHU WKDWDIWHUKHOHIW
ZDVGUXQN7KLV DUJXPHQWLVXQDYDLOLQJ)LUVWLWGRHVQRW                  .HQWXFN\ RQ sDQXDU\   KH WUDYHOHG  WR $WODQWD
FRPPXQLFDWHDQLQWHQWWRLQIOLFWERGLO\KDUP6HFRQG$GDPV                  *HRUJLD &KLFDJR ,OOLQRLV .DQVDV &LW\ 0LVVRXUL EDFN WR
KHUVHOIWHVWLILHGWKDW/DQGKDPKDGOLEHOHGKHUE\WUDQVPLWWLQJ              $WODQWDDQGWKHQWR.HQWXFN\RQ$XJXVW
GRFXPHQWVGLVSDUDJLQJKHUWRPHPEHUVRIWKHFRPPXQLW\
6KH WKHUHIRUH FRXOG QRW KDYH UHDVRQDEO\ FRQVWUXHG WKH                     $WWKHFORVHRIWKHHYLGHQFHDQGDIWHUWKHGHIHQVHUHVWHG
VWDWHPHQWVDWLVVXHLQ&RXQW)RXU DVDQ\WKLQJRWKHUWKDQD                   /DQGKDPPRYHGIRUMXGJPHQWRIDFTXLWWDODVWRDOOVL[FRXQWV
UHIHUHQFH WR ZKDW /DQGKDP KDG DOUHDG\ GRQH WR KHU RQ                7KHWULDOFRXUWJUDQWHG/DQGKDPjVPRWLRQDVWR&RXQW6L[DQG
SDSHU                                                                      GHQLHGKLVPRWLRQDVWRWKHRWKHUFRXQWV7KHMXU\FRQYLFWHG
                                                                              /DQGKDPRI&RXQWV7KUHH)RXUDQG)LYH7KHMXU\IDLOHGWR
                                                                              UHDFKDYHUGLFWRQ&RXQWV2QHDQG7ZRDQGWKHWULDOFRXUW
                                                                              JUDQWHGDPLVWULDODVWRWKHVHWZRFRXQWV7KHGLVWULFWFRXUW
                                                                              ODWHU VHQWHQFHG /DQGKDP WR D WHUP RI IRUW\RQH PRQWKVj
                                                                              LPSULVRQPHQW

     
                                                                                /DQGKDPjVWLPHO\DSSHDOIROORZV
      7KLV FRQFOXVLRQ LV UHLQIRUFHG E\ D SKRQH FDOO SODFHG SULRU WR WKH RQH
DW LVVXH LQ &RXQW )RXU ZKHUH /DQGKDP VWDWHG m2K , IRUJRW WR WHOO \RX
ZKHQ \RX WDNH 5DFKHO WR VFKRRO WRPRUURZ NQRZ WKDW /LQGD %UHH]H DQG
(G $SSOHJDWH NQRZ DOO DERXW \RX 7KH\ NQRZ \RXU DUUHVWV UHFRUGV DQG
XK \RXU O\LQJ WR WKH LQVXUDQFH FRPSDQ\ DQG \RXU DWWHPSW WR GHIUDXG VR
\RX NQRZ \RXU SURVWLWXWLRQ FKDUJHV DQG HYHU\WKLQJ HOVH DQG \RX NQRZ
DK ZKDW KDSSHQHG LQ %HYHUO\ +LOOV    l s$ 
       8QLWHG6WDWHVY/DQGKDP                         1R       1R                      8QLWHG6WDWHVY/DQGKDP         

                            ,,,$QDO\VLV                                  DVVXPLQJ KH FRXOG FRPPXQLFDWH RQH DV D PDWWHU RI ODZ
                                                                           9LHZHGLQFRQWH[WLWLVFOHDUWKDW/DQGKDPjVFRPPXQLFDWLRQ
                      $0RWLRQWR'LVPLVV                                LQ&DOOWKHRQHDWLVVXHLQ&RXQW7KUHHUHIHUVWRWKH
                                                                           LPPLQHQWFXVWRG\EDWWOHRYHU3ULVFLOOD)RUH[DPSOHLQ&DOO
   ,QKLVILUVWLVVXHRQDSSHDO/DQGKDPDUJXHVWKDWWKHGLVWULFW          /DQGKDPVWDWHG
FRXUWVKRXOGKDYHJUDQWHGKLVPRWLRQWRGLVPLVV&RXQWV7KUHH
DQG)RXURQWKHJURXQGVWKDWKLVVWDWHPHQWVZHUHQRWmWUXH                   <RXDUHDQXQILWPRWKHU<RXjUHJRLQJWRORVH5DFKHO
WKUHDWVlDQGWKHUHIRUHZHUHSURWHFWHGVSHHFK/DQGKDPGRHV                 *DLO DV ZHOO DV 3ULVFLOOD  <RX EHWWHU WDON WR PH QRZ
QRWLQGLFDWHLQKLVDSSHOODWHEULHIZKHUHWKLVLVVXHZDVUDLVHG              +RZIDUGR\RXZDQWWRFDUU\WKHJDPH"<RXjUHORVLQJ
EHORZ  7KH *RYHUQPHQW GRHV QRW ERWKHU WR DGGUHVV WKH               3ULVFLOXK5DFKHO\RXjUHJRQQDXKORVLQJ%HOLWD\RXjUH
WKUHVKROGSUHVHUYDWLRQTXHVWLRQPXFKOHVVWKHPHULWVRIWKH                 JRLQJWRORVH3ULVFLOODDQG\RXjUHJRLQJWRORVH5DFKHO
LVVXH<HWWKHUHFRUGUHYHDOVWKDW/DQGKDPSULRUWRREWDLQLQJ              7KH\jUHJRLQJWRWDNHWKHPDZD\IURP\RXDQGWKH\jUH
FRXQVHOILOHGDPRWLRQWRmGURSDOOFKDUJHVlLQSDUWRQWKH                JRLQJWRFRQYLFW\RXVR\RXMXVWZDWFKRXW(PSKDVLV
JURXQGVWKDWKDUDVVLQJSKRQHFDOOVmGRQRWYLRODWHWKHIHGHUDO               DGGHG
ODZDVZULWWHQl)XUWKHUPRUHWKHGLVWULFWFRXUWUXOHGRQWKH
PHULWV RI WKH PRWLRQ  *LYHQ WKH OLEHUDOLW\ ZLWK ZKLFK ZH        6LJQLILFDQWO\/DQGKDPGRHVQRWVWDWHWKDWKHLVJRLQJWRWDNH
FRQVWUXHSURVHSOHDGLQJVZHKROGWKLVLVVXHZDVSUHVHUYHG               $GDPVjFKLOGUHQDZD\EXWUHIHUVWRWKLUGSDUWLHVDERG\
DQGZHQRZDGGUHVVLW6HHJHQHUDOO\:LOOLDPVY%URZPDQ                 HPSRZHUHG ZLWK WKH OHJDO SRZHU WR mFRQYLFWl $GDPV
)GWK&LUSHUFXULDP                          /DQGKDP LV REYLRXVO\ UHIHUULQJ WR OHJDO HQWLWLHV ZLWK WKH
                                                                           SRZHUWRWDNHDZD\FXVWRG\DVZHOODVWRFKDUJHV$GDPVZLOO
  ,QJHQHUDODQLQGLFWPHQWLVFRQVWLWXWLRQDOO\DGHTXDWHLILW            LOOXVRU\FULPHV
mFRQWDLQV WKH HOHPHQWV RI WKH RIIHQVH FKDUJHG DQG IDLUO\
LQIRUPV D GHIHQGDQW RI WKH FKDUJH DJDLQVW ZKLFK KH PXVW             (YHQLIWKLVFRQFOXVLRQZHUHQRWREYLRXV&DOOWKH
GHIHQG DQG VHFRQG HQDEOHV KLP WR SOHDG DQ DFTXLWWDO RU         EDVLVIRU&RXQW)RXUFOLQFKHVLW7KHUH/DQGKDPUHPDUNHG
FRQYLFWLRQLQEDURIIXWXUHSURVHFXWLRQVIRUWKHVDPHRIIHQVHl
+DPOLQJY8QLWHG6WDWHV868QLWHG                    ,DPWDONLQJWRWKHVKHULII7KH\NQRZZKDWjVKDSSHQLQJ
6WDWHVY0DQH\)GWK&LU8QLWHG                 ,jPWDONLQJWRWKH+LJKZD\3DWURO<RXjUHJRLQJWRORVH
6WDWHV Y 0RQXV  )G   WK &LU                  FXVWRG\RI5DFKHODVZHOODV3ULVFLOOD(PSKDVLVDGGHG
                                                                           )XUWKHULQ&DOO/DQGKDPDOVRVWDWHGm<RXDLQjWJRLQJ
                                                                          WR KDYH 3ULVFLOOD WR UDLVH DQG ,jP FRPLQJ WR JHW KHU  ,jP
      7KH 1RWLFH &ODXVH RI WKH 6L[WK $PHQGPHQW UHTXLUHV WKDW D FULPLQDO
GHIHQGDQW KDV WKH ULJKW mWR EH LQIRUPHG RI WKH QDWXUH DQG FDXVH RI WKH
                                                                           PDNLQJ PRQH\l  (PSKDVLV DGGHG  +HUH /DQGKDPjV
DFFXVDWLRQl DJDLQVW KLP 86 &RQVW DPHQG 9,8QLWHG  6WDWHV Y 0DQH\
                                                                           UHIHUHQFHWRPRQH\VXJJHVWVKLVDELOLW\WRSXUVXHKLVFXVWRG\
 )G   WK &LU  )XUWKHU WKH ,QGLFWPHQW &ODXVH RI WKH   ULJKWVZLWK3ULVFLOOD
)LIWK $PHQGPHQW UHTXLUHV WKDW D GHIHQGDQW EH FKDUJHG ZLWK RQO\ WKRVH
FKDUJHV EURXJKW EHIRUH WKH JUDQG MXU\ 86 &RQVW DPHQG 9 0DQH\         ,Q VKRUW UHYLHZ RI /DQGKDPjV SKRQH FDOOV GHPRQVWUDWHV
 )G DW                                                            WKDW/DQGKDPZDVUHIHUULQJWRDQLPPLQHQWFXVWRG\EDWWOH
                                                                          $VQRWHG/DQGKDPZDVWKHELRORJLFDOIDWKHURI3ULVFLOODDQG
      $V 3URIHVVRUV /D)DYH ,VUDHO DQG .LQJ KDYH REVHUYHG mWKH           DVVXFKKDGDOHJDOULJKWWRFXVWRG\RIKHU7KHsDQXDU\
+DPOLQJ  VWDQGDUG DFWXDOO\ LQFOXGHV WKUHH UHTXLUHPHQWV  LQFOXVLRQ RI
WKH HOHPHQWV RI WKH RIIHQVH  SURYLGLQJ DGHTXDWH QRWLFH DV WR WKH
                                                                            '92 JUDQWHG RQO\ WHPSRUDU\ FXVWRG\ RI 3ULVFLOOD WR
FKDUJH DQG  SURYLGLQJ SURWHFWLRQ DJDLQVW GRXEOH MHRSDUG\l :D\QH 5
                                                                           $GDPV0RUHRYHUWKHUHZDVQRHYLGHQFHRUDOOHJDWLRQWKDW
       8QLWHG6WDWHVY/DQGKDP                               1R          1R                       8QLWHG6WDWHVY/DQGKDP            

&RXQW7KUHHZDVDWUDQVPLVVLRQLQLQWHUVWDWHFRPPHUFHDQG                            +RZHYHULWLVD[LRPDWLFWKDWm>W@REHOHJDOO\VXIILFLHQWWKH
WKDWLWZDVDmWUXHWKUHDWl                                                      LQGLFWPHQW PXVW DVVHUW IDFWV ZKLFK LQ ODZ FRQVWLWXWH DQ
                                                                                     RIIHQVHDQGZKLFKLISURYHGZRXOGHVWDEOLVKSULPDIDFLHWKH
                           D,QWHUVWDWH7UDQVPLVVLRQ                                GHIHQGDQWjV FRPPLVVLRQ RI WKDW FULPHl  8QLWHG 6WDWHV Y
                                                                                     6XSHULRU*URZHUV6XSSO\,QF)GWK&LU
  7KH*RYHUQPHQWZDVUHTXLUHGWRSURYHWKDW/DQGKDPPDGH                             FLWLQJ)OHLVKHUY8QLWHG6WDWHV86
WKH FDOO RXWVLGH WKH VWDWH RI .HQWXFN\  $FFRUGLQJ WR WKH                  SHUFXULDPFI+DPOLQJ86DWVWDWLQJWKDWDQ
,QGLFWPHQW WKH VWDWHPHQW LQ &RXQW 7KUHH ZDV PDGH RQ RU                     LQGLFWPHQWLVVXIILFLHQWLILWmVHW>V@IRUWKWKHRIIHQVHLQWKH
DERXW)HEUXDU\$JHQW:DUQHUWHVWLILHGWKDW/DQGKDP                         ZRUGVRIWKHVWDWXWHLWVHOIDVORQJDVWKRVHZRUGVIXOO\
WROGKHUWKDWDIWHUsDQXDU\ZKHQWKHWKLUGDQGILQDO                        GLUHFWO\DQGH[SUHVVO\VHWIRUWKDOOWKHHOHPHQWVQHFHVVDU\
'92ZDVHQWHUHGDJDLQVWKLPKHJRWDULGHWRWKHEXVVWDWLRQ                        WRFRQVWLWXWHWKHRIIHQVHLQWHQGHGWREHSXQLVKHGlFLWDWLRQV
LQ /H[LQJWRQ .HQWXFN\  )URP WKHUH KH URGH E\ EXV WR                      RPLWWHG$QLQGLFWPHQWLVXVXDOO\VXIILFLHQWLILWVWDWHVWKH
$WODQWD*HRUJLDWRYLVLWKLVSDUHQWVZKHUHKHUHPDLQHGIURP                       RIIHQVHXVLQJWKHZRUGVRIWKHVWDWXWHLWVHOIDVORQJDVWKH
VHYHQWRWHQGD\V:DUQHUWHVWLILHGWKDW/DQGKDPWROGKHUWKDW                      VWDWXWHIXOO\DQGXQDPELJXRXVO\VWDWHVDOOWKHHOHPHQWVRIWKH
KHQH[WWUDYHOHGWR&KLFDJRWKHQRQWR,QGLDQDSROLVDQGWKHQ                       RIIHQVH+DPOLQJ86DW0RQXV)GDW
WR .DQVDV &LW\ DW WKH HQG RI 0D\  ,Q VKRUW DOWKRXJK QRW                $W WKH VDPH WLPH WKH 6XSUHPH &RXUW KDV FDXWLRQHG
GLUHFW HYLGHQFH ZH WKLQN WKH *RYHUQPHQW VXIILFLHQWO\                          m8QGRXEWHGO\WKHODQJXDJHRIWKHVWDWXWHPD\EHXVHGLQWKH
HVWDEOLVKHG WKURXJK FLUFXPVWDQWLDO HYLGHQFH WKDW /DQGKDP                        JHQHUDOGHVFULSWLRQRIWKHRIIHQVHEXWLWPXVWEHDFFRPSDQLHG
ZDVQRWLQWKHVWDWHRI.HQWXFN\ZKHQKHSODFHGWKHFDOORQ                          ZLWKVXFKDVWDWHPHQWRIWKHIDFWVDQGFLUFXPVWDQFHVDVZLOO
)HEUXDU\   WR $GDPV  9LHZHG LQ WKH OLJKW PRVW                      LQIRUPWKHDFFXVHGRIWKHVSHFLILFRIIHQVHFRPLQJXQGHUWKH
IDYRUDEOH WR WKH *RYHUQPHQW ZH ILQG WKDW LW SUHVHQWHG                       JHQHUDOGHVFULSWLRQZLWKZKLFKKHLVFKDUJHGl+DPOLQJ
VXIILFLHQWHYLGHQFHIRUDQ\MXURUWRILQGWKDWWKHILUVWHOHPHQW                     86DWTXRWDWLRQPDUNVRPLWWHGHPSKDVLVDGGHG
RIFZDVPHW
                                                                                       )XUWKHU FRXUWV HYDOXDWLQJ PRWLRQV WR GLVPLVV GR QRW
                                E7UXH7KUHDW                                       HYDOXDWHWKHHYLGHQFHXSRQZKLFKWKHLQGLFWPHQWLVEDVHG
   /DQGKDPDOVRDVVHUWVWKDWWKHVWDWHPHQWLQ&RXQW7KUHHZDV
QRWDmWUXHWKUHDWl$VLQGLFDWHGWKHGLVWULFWFRXUWHUUHGLQ
QRWGLVPLVVLQJWKLVFRXQWEHFDXVHLWIDLOVDVDPDWWHURIODZWR                     /D)DYH   HW DO  &5,0,1$/ 352&('85(  D DW  
VWDWHDYLRODWLRQRIF,QDQ\HYHQWZHILQGWKDWQR                        7KH\ KDYH DOVR QRWHG WKDW WKH ILUVW UHTXLUHPHQW NQRZQ DV WKH mHVVHQWLDO
UDWLRQDOWULHURIIDFWFRXOGILQGEH\RQGDUHDVRQDEOHGRXEW                        HOHPHQWVl UHTXLUHPHQW
WKDW /DQGKDP FRPPXQLFDWHG D WUXH WKUHDW WR NLGQDS                                  LV EDVHG SULPDULO\ XSRQ D WKLUG SOHDGLQJ IXQFWLRQ VRPHWLPHV
                                                                                          FKDUDFWHUL]HG DV WKH mMXGLFLDO UHYLHZl IXQFWLRQ 7KDW IXQFWLRQ
                                                                                          KDV EHHQ GHVFULEHG E\ WKH 6XSUHPH &RXUW DV mLQIRUP>LQJ@ WKH
                                                                                          >WULDO@ FRXUW RI WKH IDFWV DOOHJHG VR WKDW LW PD\ GHFLGH ZKHWKHU
                                                                                          WKH\ DUH VXIILFLHQW LQ ODZ WR VXSSRUW D FRQYLFWLRQ LI RQH VKRXOG
     
        $W   WULDO   WKH   *RYHUQPHQW   LQWURGXFHG   DQ   H[KLELW   SORWWLQJ   RXW        EH KDG $OWKRXJK WKLV mMXGLFLDO UHYLHZl IXQFWLRQ LV PHQWLRQHG
/DQGKDPjV URXWH EHWZHHQ sDQXDU\   DQG $XJXVW   EDVHG                         IDU OHVV IUHTXHQWO\ WKDQ WKH mQRWLFH DQG mGRXEOH MHRSDUG\l
XSRQ UHFHLSWV UHFRYHUHG IURP /DQGKDPjV YHKLFOH              7KHUH LV QR FOHDU            IXQFWLRQV LW UHPDLQV D FRUQHUVWRQH RI ERWK IHGHUDO DQG VWDWH
HYLGHQFH WKDW /DQGKDP ZDV QRW LQ WKH VWDWH RI .HQWXFN\ RQ )HEUXDU\                      SOHDGLQJ UHTXLUHPHQWV
    7KH RQO\ SURRI LV WKDW RQ sDQXDU\   /DQGKDP GHSDUWHG                ,G  G DW  FLWLQJ 8QLWHG 6WDWHV Y &UXLNVKDQN  86 
/H[LQJWRQ .HQWXFN\ IRU $WODQWD *HRUJLD       7KHUH LV QR RWKHU HQWU\ XQWLO        2WWR    /(G   IRRWQRWHV DQG FLWDWLRQV RPLWWHG
$SULO   IRU DQ $70 UHFHLSW LQ &KLFDJR ,OOLQRLV
    8QLWHG6WDWHVY/DQGKDP                          1R       1R                      8QLWHG6WDWHVY/DQGKDP          

6HH&RVWHOORY8QLWHG6WDWHV86                   7KLV VWDWHPHQW LV QRW D mFRPPXQLFDWLRQ FRQWDLQLQJ D
8QLWHG 6WDWHV Y 3RZHOO  )G   WK &LU        WKUHDWl/DQGKDPjVVWDWHPHQWm,KDYHGRQHPRUHWR\RXZLWK
8QLWHG6WDWHVY0DUNH\)GWK&LU               D 3DUNHU ILIW\RQH WKDQ \RXU WKDQ \RXU ZHOO WKDQ ZKDW
 VWDWLQJ WKDW WKH mYDOLGLW\ RI DQ LQGLFWPHQW LV QRW        KDSSHQHGWR\RXUIDWKHUZLWKDJRGGDPQ7DXUXVILYHVKRWl
DIIHFWHGE\WKHW\SHRIHYLGHQFHSUHVHQWHGWRWKHJUDQGMXU\             HPSKDVLVDGGHGUHIHUVWRSDVWFRQGXFWQRWSUHVHQWRUIXWXUH
HYHQWKRXJKWKDWHYLGHQFHPD\EHLQFRPSHWHQWLQDGHTXDWHRU               FRQGXFW)XUWKHUPRUHHYHQLIWKHVWDWHPHQWZHUHDYHLOHG
KHDUVD\l8QLWHG6WDWHVY6KRUW)GWK&LU            WKUHDWLWZDVQRWDQLQWHQWWRLQIOLFWERGLO\KDUP$3DUNHU
 VWDWLQJ WKDW FULPLQDO FDVHV VKRXOG QRW EH mIXUWKHU         ILIW\RQHLVDIRXQWDLQSHQ$OWKRXJKWKHVWDWHPHQWLVREVFXUH
DWWHQXDWHGE\SUHOLPLQDU\WULDOVFRQFHUQLQJWKHDGHTXDF\RI               DQGDOVRUHIHUHQFHVDJXQLWLVVHOIHYLGHQWWKDW/DQGKDPLV
JUDQG MXU\ SURFHHGLQJV D FRQFHUQ SDUWLFXODUO\ QRWHG LQ            UHIHUULQJ WR GDPDJLQJ UHPDUNV KH KDG SUHYLRXVO\ PDGH E\
&RVWHOORlTXRWDWLRQPDUNVRPLWWHG+RZHYHUDSSO\LQJWKLV             WUDQVPLWWLQJ ZULWWHQ FRPPXQLFDWLRQV  6WDWHG GLIIHUHQWO\
SULQFLSOH WR  F LV  SUREOHPDWLF EHFDXVH WKH DOOHJHG       WKHUHLVVLPSO\QRFRPPXQLFDWLRQZKLFKmDUHDVRQDEOHSHUVRQ
WKUHDWHQLQJ VWDWHPHQW PXVW EH YLHZHG IURP WKH REMHFWLYH            ZRXOGWDNHDVDVHULRXVH[SUHVVLRQRIDQLQWHQWLRQWR
SHUVSHFWLYH RI WKH UHFLSLHQW ZKLFK IUHTXHQWO\ LQYROYHV WKH        LQIOLFWERGLO\KDUPl$ONKDED])GDW
FRQWH[W RI WKH SDUWLHVj UHODWLRQVKLS  )RU WKLV UHDVRQ LW LV
LQFXPEHQWRQWKH*RYHUQPHQWWRPDNHWKDWFRQWH[WFOHDULQ                    %HFDXVHWKHLQGLFWPHQWIDLOHGDVDPDWWHURIODZWRDOOHJH
VXFKDQLQGLFWPHQWXQOHVVWKHDOOHJHGWKUHDWLVGLUHFW               D YLRODWLRQ RI  F WKH GLVWULFW FRXUW HUUHG LQ GHQ\LQJ
                                                                          /DQGKDPjV PRWLRQ WR GLVPLVV &RXQW )RXU  1RQHWKHOHVV
   :KHWKHUWKHHOHPHQWVRIWKHRIIHQVHDUHDGHTXDWHO\DOOHJHG             JLYHQWKHGLIILFXOW\LQDQDO\]LQJWKHVHW\SHVRIFRXQWVDEVHQW
LQ WKH LQGLFWPHQW LV D OHJDO TXHVWLRQ VXEMHFW WR GH QRYR        FRQWH[WDQGWKHSURFHGXUDOFRQIXVLRQFDXVHGE\WKHSDUWLHV
UHYLHZ6XSHULRU*URZHUV)GDW0DQH\)G               DQGWKHORZHUFRXUWZHZLOODOVRDGGUHVVWKHVHLVVXHVLQWKH
DW,IWKHLQGLFWPHQWLVOHJDOO\GHILFLHQWWKHSURSHUUHVXOW        QH[WVHFWLRQ
LVGLVPLVVDORIWKHLQGLFWPHQW6XSHULRU*URZHUV)G
DWFI8QLWHG6WDWHVY$ONKDED])G                                    %0RWLRQIRU$FTXLWWDO
WK&LUFRQFOXGLQJWKDWWKHLQGLFWPHQWIDLOHGmDVD
PDWWHU RI ODZl WR DOOHJH YLRODWLRQV RI  F DIILUPLQJ         /DQGKDPDUJXHVWKDWWKHGLVWULFWFRXUWHUUHGLQGHQ\LQJKLV
GLVPLVVDORILQGLFWPHQW                                                 PRWLRQIRUDFTXLWWDODVWR&RXQWV7KUHH)RXUDQG)LYH,Q
                                                                          UHYLHZLQJWKHGHQLDORIDPRWLRQIRUDFTXLWWDOmWKHUHOHYDQW
   %RWK&RXQWV7KUHHDQG)RXUDURVHXQGHU86&                TXHVWLRQLVZKHWKHUDIWHUYLHZLQJWKHHYLGHQFHLQWKHOLJKW
6HFWLRQFPDNHVLWDFULPHWRmWUDQVPLW>@LQLQWHUVWDWH             PRVWIDYRUDEOHWRWKHSURVHFXWLRQDQ\UDWLRQDOWULHURIIDFW
FRPPHUFHDQ\FRPPXQLFDWLRQFRQWDLQLQJDQ\WKUHDWWRNLGQDS                FRXOGKDYHIRXQGWKHHVVHQWLDOHOHPHQWVRIWKHFULPHEH\RQG
DQ\ SHUVRQ RU DQ\ WKUHDW WR LQMXUH WKH SHUVRQ RI DQRWKHUl      DUHDVRQDEOHGRXEWlsDFNVRQY9LUJLQLD86
86&$F:HVW7KLV&RXUWKDVKHOGWKDW               
 F FRQWDLQV WKUHH HOHPHQWV m D WUDQVPLVVLRQ LQ
LQWHUVWDWHFRPPHUFHDFRPPXQLFDWLRQFRQWDLQLQJDWKUHDW                                      &RXQW7KUHH
DQGWKHWKUHDWPXVWEHDWKUHDWWRLQMXUH>RUNLGQDS@WKH
SHUVRQRIDQRWKHUl8QLWHG6WDWHVY'H$QGLQR)G               (YHQLI&RXQW7KUHHZHUHSURSHURQLWVIDFH/DQGKDPjV
 WK &LU   :H KDYH GHILQHG mFRPPXQLFDWLRQ              PRWLRQIRUMXGJPHQWRIDFTXLWWDORQ&RXQW7KUHHVKRXOGKDYH
FRQWDLQLQJ D WKUHDWl WKH VHFRQG HOHPHQW LQ WKH IROORZLQJ        EHHQJUDQWHG:HWKHUHIRUHGLVFXVVKLVDUJXPHQWVWKDWWKH
PDQQHU                                                                   *RYHUQPHQWIDLOHGWRHVWDEOLVKWKDWWKHVWDWHPHQWDWLVVXHLQ
    8QLWHG6WDWHVY/DQGKDP                       1R       1R                        8QLWHG6WDWHVY/DQGKDP           

  RIILFLDOV  7KH SHQDOW\ SURYLVLRQ DOVR SURYLGHV OHVVHU          DFRPPXQLFDWLRQPXVWEHVXFKWKDWDUHDVRQDEOHSHUVRQ
  VDQFWLRQVIRUFRPPLVVLRQRIWKLVRIIHQVHE\DUHODWLYHDV              ZRXOGWDNHWKHVWDWHPHQWDVDVHULRXVH[SUHVVLRQRIDQ
  GHILQHGLQ.56                                                LQWHQWLRQ WR >NLGQDS RU@ LQIOLFW ERGLO\ KDUP WKH PHQV
                                                                         UHD>@DQGZRXOGSHUFHLYHVXFKH[SUHVVLRQDVEHLQJ
.\ 5HY 6W $QQ   %DQNV%DOGZLQ                  FRPPXQLFDWHGWRHIIHFWVRPHFKDQJHRUDFKLHYHVRPH
&RPPHQWDU\                                                              JRDOWKURXJKLQWLPLGDWLRQWKHDFWXVUHXV
  1RU FRXOG /DQGKDPjV DOOHJHG FRQGXFW EH D YLRODWLRQ RI        $ONKDED])GDW%RWKWKHPHQVUHDDQGWKHDFWXV
IHGHUDOODZ6HH86&$J:HVWSDUHQW            UHXVPXVWEHGHWHUPLQHGREMHFWLYHO\IURPWKHSHUVSHFWLYHRI
H[HPSWLRQ WR IHGHUDO NLGQDSSLQJ VWDWXWH 8QLWHG 6WDWHV Y      WKHUHFHLYHU,GDW
6KHHN  )G   WK &LU  KROGLQJ WKDW
SDUHQW H[HPSWLRQ WR IHGHUDO NLGQDSSLQJ VWDWXWH DSSOLHV WR         )LQDOO\ LW LV ZHOO HVWDEOLVKHG WKDW WUXH WKUHDWV XQOLNH
ELRORJLFDO SDUHQW ZKRVH SDUHQWDO ULJKWV KDYH EHHQ                SROLWLFDO K\SHUEROH DQG RWKHU SURWHFWHG VSHHFK DUH QRW
SHUPDQHQWO\ WHUPLQDWHG  7KXV KDG /DQGKDP UHPRYHG              SURWHFWHGE\WKH)LUVW$PHQGPHQW:DWWVY8QLWHG6WDWHV
3ULVFLOODKHPD\KDYHEHHQLQYLRODWLRQRIWKH'92EXWQRW           86SHUFXULDP2QWKHRWKHUKDQG
WKH.HQWXFN\NLGQDSSLQJVWDWXWHRUWKH)HGHUDO.LGQDSSLQJ              VSHHFK WKDW LV YXOJDU RU RIIHQVLYH LV SURWHFWHG  6HH 6DEOH
$FW  7KHUHIRUH LI /DQGKDP ZDV OHJDOO\ LQFDSDEOH RI           &RPPXQLFDWLRQV Y )&&  86   &RKHQ Y
NLGQDSSLQJ 3ULVFLOOD KH FRXOG QRW OHJDOO\ PDNH D WKUHDW WR   &DOLIRUQLD86
NLGQDS
                                                                                                  &RXQW7KUHH
  ,Q VXP EHFDXVH LW LV PLVVLQJ WZR RI WKH WKUHH HVVHQWLDO
HOHPHQWVRIDFFODLPDFRPPXQLFDWLRQFRQWDLQLQJD               &RXQW7KUHHDOOHJHV
WKUHDWDQGDWKUHDWWRNLGQDSWKLVFRXQWIDLOVDVDPDWWHURI
ODZDQGVKRXOGKDYHEHHQGLVPLVVHG                                      2QRUDERXWD)HEUXDU\WKLQ/HZLV&RXQW\LQ
                                                                         WKH(DVWHUQ'LVWULFWRI.HQWXFN\
                         &RXQW)RXU
                                                                                         :,//,$00/$1'+$0
  &RXQW)RXUDOOHJHV
                                                                         GHIHQGDQW KHUHLQ GLG NQRZLQJO\ WUDQVPLW LQ LQWHUVWDWH
  2QRUDERXWDGDWHLQ0DUFKRU$SULOWKHH[DFWGDWH              FRPPHUFHDWKUHDWWRNLGQDSDQRWKHUSHUVRQLQWKDWE\
  XQNQRZQWRWKH*UDQGsXU\                                            LQWHUVWDWHSKRQHFDOOKHVWDWHGWR%HOLWD/DQGKDPZRUGV
                                                                         WRWKHHIIHFWm,jPJRLQJWRWHOO\RXVRPHWKLQJ\RX
                 :,//,$00/$1'+$0                                      <RX ZLOO QRW KDYH 3ULVFLOOD E\ KHU VHFRQG ELUWKGD\
  GHIHQGDQW KHUHLQ GLG NQRZLQJO\ WUDQVPLW LQ LQWHUVWDWH
  FRPPHUFHDWKUHDWWRLQMXUHDQRWKHUSHUVRQ LQWKDWE\                  
                                                                             ,Q DUJXLQJ WKDW KLV VWDWHPHQWV ZHUH QRW mWUXH WKUHDWVl /DQGKDP
  LQWHUVWDWHSKRQHFDOOKHVWDWHGWR%HOLWD/DQGKDPZRUGV              UHOLHV RQ 8QLWHG 6WDWHV Y .HOQHU  )G  G &LU  IRU WKH
  WRWKHHIIHFWm,WjVRYHUNLG$UH\RXDQLGLRW",jYHGRQH          SURSRVLWLRQ WKDW D WKUHDW XQGHU  F PXVW EH mVR XQHTXLYRFDO
  PRUHWR\RXZLWKD3DUNHUWKDQZKDWKDSSHQHGWR\RXU              XQFRQGLWLRQDO LPPHGLDWH DQG VSHFLILF DV WR WKH SHUVRQ WKUHDWHQHG DV WR
  IDWKHUZLWKDJRGGDPQ7DXUXVILYHVKRWlDOOLQYLRODWLRQ            FRQYH\ D JUDYLW\ RI SXUSRVH DQG LPPLQHQW SURVSHFW RI H[HFXWLRQl ,G DW

  RI7LWOH8QLWHG6WDWHV&RGH6HFWLRQ                         7KLV VWDQGDUG GLIIHUV IURP WKH UXOH LQ WKLV &LUFXLW DV VHW IRUWK LQ
                                                                       $ONKDED] DQG ZH GHFOLQH WR DSSO\ LW
    8QLWHG6WDWHVY/DQGKDP                      1R      1R                     8QLWHG6WDWHVY/DQGKDP         

  EHFDXVH,jPJRLQJWRKDYHDOO\RXUFKLOGUHQ<RX            .\ 5HY 6WDW $QQ   %DQNV%DOGZLQ 
  ZLOOQRWKDYH3ULVFLOODWRUDLVH,jPJRLQJWRJHWKHUl      )XUWKHUPRUHmLWLVDGHIHQVH>WRNLGQDSSLQJXQGHU.\5HY
  DOOLQYLRODWLRQRI7LWOH8QLWHG6WDWHV&RGH6HFWLRQ          6WDW$QQ@WKDWWKHGHIHQGDQWZDVDUHODWLYHRIWKH
                                                                 YLFWLP DQG KLV VROH SXUSRVH ZDV WR DVVXPH FXVWRG\ RI WKH
                                                                     YLFWLPl.\5HY6W$QQ%DOGZLQ$W
  7KHGLVWULFWFRXUWHUUHGLQIDLOLQJWRGLVPLVV&RXQW7KUHH        EHVW /DQGKDP FRXOG RQO\ EH FKDUJHG ZLWK mFXVWRGLDO
7KLVVWDWHPHQWFRQWDLQVQRFRPPXQLFDWLRQFRQWDLQLQJDGLUHFW         LQWHUIHUHQFHl XQGHU .\ 5HY 6W $QQ    m$
WKUHDWWRNLGQDSQRUZRXOGDUHDVRQDEOHREVHUYHULQ%HOLWD          SHUVRQLVJXLOW\RIFXVWRGLDOLQWHUIHUHQFHZKHQNQRZLQJWKDW
$GDPVj VKRHV SHUFHLYH LW DV DQ LQGLUHFW WKUHDW  7KLV LV   KHKDVQROHJDOULJKWWRGRVRKHWDNHV>D@SHUVRQHQWUXVWHG
HVSHFLDOO\VRJLYHQWKDWMXVWRQHPRQWKHDUOLHU$GDPVKDG          E\DXWKRULW\RIODZWRWKHFXVWRG\RIDQRWKHUSHUVRQl$VWKH
REWDLQHGD'92UHPRYLQJ/DQGKDPIURPWKHKRPHEDUULQJ               FRPPHQWDU\PDNHVFOHDU
KLPIURPFRQWDFWZLWKKLVGDXJKWHUDQGJUDQWLQJWHPSRUDU\
FXVWRG\WR$GDPV6KHKDGDOVRILOHGIRUGLYRUFH7KXV                7KHFRPELQHGHIIHFWVRI.56 DQG
FXVWRG\ RI 3ULVFLOOD REYLRXVO\ ZRXOG EH DQ LVVXH LQ WKH       DUHWRUHQGHUWKHVWDWXWHVRQXQODZIXOLPSULVRQPHQWDQG
GLYRUFHSURFHHGLQJHVSHFLDOO\VLQFH/DQGKDPKDGUHSHDWHGO\            NLGQDSSLQJ LQDSSOLFDEOH WR VLWXDWLRQV LQYROYLQJ WKH
DFFXVHG$GDPVRIFKLOGDEXVH/DQGKDPjVVWDWHPHQWm,jP               DFTXLVLWLRQRIFRQWURORYHUDQRWKHUEHFDXVHRIIDPLOLDO
JRLQJWRJHWKHUlLQFRQWH[WUHIHUVWRDFXVWRG\EDWWOHGXULQJ       DIIHFWLRQ RU FRQVLGHUDWLRQV DQG WR FUHDWH D VSHFLDO
WKHGLYRUFHSURFHHGLQJ0RUHRYHUWKHUHZDVQRDOOHJDWLRQ            RIIHQVHWRGHDOZLWKFRQGXFWLQYROYLQJDQLQWHUIHUHQFH
WKDW/DQGKDPKDGHYHUDWWHPSWHGWRDEGXFW3ULVFLOODLQWKH             ZLWKODZIXOFXVWRG\:KLOHHOLPLQDWLQJWKHSRVVLELOLW\RI
SDVW                                                                  FKLOG FXVWRG\ GLVSXWHV FRQVWLWXWLQJ XQODZIXO
                                                                       LPSULVRQPHQWRUNLGQDSSLQJWKHVHSURYLVLRQVUHIOHFWD
  0RUH IXQGDPHQWDO LV WKH IDFW WKDW /DQGKDP FRXOG QRW          MXGJPHQW WKDW WKHUH H[LVWV D QHHG WR SURWHFW mSDUHQWDO
OHJDOO\EHFKDUJHGZLWKNLGQDSSLQJXQGHUVWDWHRUIHGHUDOODZ          FXVWRG\DJDLQVWDOOXQODZIXOLQWHUUXSWLRQHYHQZKHQWKH
LQWKHILUVWSODFHVRWKDWWKHWKLUGHOHPHQWRIFLVQRW        FKLOG LWVHOI LV D ZLOOLQJ XQGHFHLYHG SDUWLFLSDQW LQ WKH
PHW3ULVFLOODLVWKHELRORJLFDOGDXJKWHURI/DQGKDPDQGKLV         DWWDFNRQWKLVLQWHUHVWRILWVSDUHQWl0RGHO3HQDO&RGH
SDUHQWDOULJKWVKDGQRWEHHQWHUPLQDWHG7KHsDQXDU\               &RPPHQWV 7HQW 'UDIW 1R      
'92PHUHO\JUDQWHG$GDPVWHPSRUDU\FXVWRG\RI3ULVFLOOD               %HFDXVHRIWKHIDFWWKDWPRVWFDVHVWRDULVHXQGHUWKLV
                                                                       VWDWXWH ZLOO LQYROYH FXVWRGLDO GLVSXWHV LQ GRPHVWLF
  $SHUVRQLVQRWJXLOW\RINLGQDSSLQJXQGHU.HQWXFN\ODZ              UHODWLRQVVLWXDWLRQVDVSHFLDOGHIHQVHLVSURYLGHGIRUD
XQOHVVKHmXQODZIXOO\UHVWUDLQVDQRWKHUSHUVRQDQGZKHQKLV           GHIHQGDQWZKRUHOLQTXLVKHVKLVZURQJIXOFXVWRG\SULRUWR
LQWHQWLVl                                                           WKHLQLWLDWLRQRIWKHFULPLQDOSURFHVVWKURXJKDUUHVWRUWKH
                                                                       LVVXDQFHRIDZDUUDQW
  D7RKROGKLPIRUUDQVRPRUUHZDUGRU
  E 7R DFFRPSOLVK RU WR DGYDQFH WKH FRPPLVVLRQ RI D           7KH SHQDOW\ VWUXFWXUH IRU WKH RIIHQVH RI FXVWRGLDO
  IHORQ\RU                                                          LQWHUIHUHQFH LV GHVLJQHG WR HQFRXUDJH DQ RIIHQGHU WR
  F7RLQIOLFWERGLO\LQMXU\RUWRWHUURUL]HWKHYLFWLPRU           UHWXUQ KLV YLFWLP WR ODZIXO FXVWRG\ RQ KLV RZQ HYHQ
  DQRWKHURU                                                          WKRXJK WKH GHIHQVH PHQWLRQHG DERYH LV XQDYDLODEOH WR
  G7RLQWHUIHUHZLWKWKHSHUIRUPDQFHRIDJRYHUQPHQWDO              KLP$mYROXQWDU\lUHWXUQZLWKLQWKHFRQWHPSODWLRQRI
  RUSROLWLFDOIXQFWLRQRU                                           WKLVSURYLVLRQLVRQHWKDWLVQRWVWLPXODWHGE\DWKUHDWRI
  H7RXVHKLPDVDVKLHOGRUKRVWDJH                               LPPHGLDWHDSSUHKHQVLRQRUGHWHFWLRQE\ODZHQIRUFHPHQW