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&28572)$33($/6 )257+(6,;7+&,5&8,7 BBBBBBBBBBBBBBBBB

81,7(' 67$7(6 2) $0(5,&$ ; 3ODLQWLII$SSHOOHH    1R  Y  !  /$55< '($1 '86(1%(5<  'HIHQGDQW$SSHOODQW  1 $SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW IRUWKH1RUWKHUQ'LVWULFWRI2KLRDW$NURQ 1R nsDPHV6*ZLQ'LVWULFWsXGJH 6XEPLWWHG sXQH 'HFLGHGDQG)LOHG sXO\ %HIRUH 0$57,1&KLHIsXGJH :(//)25'DQG %$7&+(/'(5&LUFXLWsXGJHV

7KLV GHFLVLRQ ZDV RULJLQDOO\ LVVXHG DV DQ mXQSXEOLVKHG GHFLVLRQl ILOHG RQ sXO\   2Q $XJXVW   WKH FRXUW GHVLJQDWHG WKH RSLQLRQ DV RQH UHFRPPHQGHG IRU IXOOWH[W SXEOLFDWLRQ

  8QLWHG6WDWHVY'XVHQEHU\ 1R 

BBBBBBBBBBBBBBBBB &2816(/ 21%5,() /DUU\'HDQ'XVHQEHU\7HUUH+DXWH,QGLDQD SUR VH  +HUEHUW s 9LOOD $66,67$17 86 $77251(< &OHYHODQG2KLRIRU$SSHOOHH BBBBBBBBBBBBBBBBB 23,1,21 BBBBBBBBBBBBBBBBB 3(5&85,$0/DUU\'HDQ'XVHQEHU\DSSHDOVDGLVWULFW FRXUW MXGJPHQW JUDQWLQJ VXPPDU\ MXGJPHQW IRU WKH JRYHUQPHQW LQ WKLV DGPLQLVWUDWLYH IRUIHLWXUH SURFHHGLQJ LQLWLDWHG SXUVXDQWWR86&† D  7KLVFDVHKDV EHHQUHIHUUHGWRDSDQHORIWKHFRXUWSXUVXDQWWR5XOH M   5XOHV RI WKH 6L[WK &LUFXLW  8SRQ H[DPLQDWLRQ WKLV SDQHO XQDQLPRXVO\DJUHHVWKDWRUDODUJXPHQWLVQRWQHHGHG)HG5 $SS3 D  2Q$SULO  'XVHQEHU\ZDVDUUHVWHGRQGUXJDQG SRVVHVVLRQ RI ILUHDUP FKDUJHV  'XULQJ D VHDUFK RI 'XVHQEHU\jV SURSHUW\ DW WKH WLPH RI WKH DUUHVW ODZ HQIRUFHPHQWDJHQWVVHL]HGDSSUR[LPDWHO\ LQFDVKD  &KHYUROHW0RQWH&DUORDXWRPRELOHDQGPLVFHOODQHRXV SHUVRQDOSURSHUW\'XVHQEHU\jVFODLPIRUFRPSHQVDWLRQIRU WKLVSURSHUW\LVQRZDWLVVXH 'XVHQEHU\LQLWLDOO\ILOHGD)HG5&ULP3 H PRWLRQ UHTXHVWLQJ WKH UHWXUQ RI WKH VHL]HG SURSHUW\ ZKLFK PRWLRQ ZDV GHQLHG  8SRQ DSSHDO WKLV FRXUW YDFDWHG WKH GLVWULFW FRXUWjVMXGJPHQWDQGUHPDQGHGWKHFDVH6HH'XVHQEHU\Y 8QLWHG6WDWHV1R  :/  WK&LU6HSW    XQSXEOLVKHGRUGHU :HGLUHFWHGWKDWWKHGLVWULFW FRXUWmFRQVWUXHWKHPDWWHUDVDFLYLODFWLRQVHHNLQJHTXLWDEOH UHOLHI DQG GHWHUPLQH ZKHWKHU WKH JRYHUQPHQW SURYLGHG 'XVHQEHU\ZLWKDFWXDOQRWLFHRIWKHYDULRXVIRUIHLWXUHVl,G DW  1R  8QLWHG6WDWHVY'XVHQEHU\ 

7KHGLVWULFWFRXUWWKHQSUHVLGHGRYHUDWHOHSKRQHGHSRVLWLRQ RIsDPHV/DZVRQDQ,QPDWH6\VWHPV2IILFHUVDWWKH)HGHUDO &RUUHFWLRQDO,QVWLWXWLRQLQ0LODQ0LFKLJDQZKHUH'XVHQEHU\ ZDVLQFDUFHUDWHGDWWKHWLPHWKHDOOHJHGQRWLFHUHJDUGLQJWKH FDVKZDVGHOLYHUHGLQFRQQHFWLRQZLWKWKLVFRQWURYHUV\ 7KH GLVWULFW FRXUW GHWHUPLQHG WKDW WKH SHUVRQDO SURSHUW\ VKRXOGKDYHEHHQUHWXUQHGXSRQ'XVHQEHU\j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jV )DPLO\ 0NW ,QF  )G     WK &LU    3HRSOHV %DQN  7UXVW &R RI 0DGLVRQ&RXQW\Y$HWQD&DV 6XU&R)G  WK &LU     6XPPDU\ MXGJPHQW LV DSSURSULDWH ZKHUH mWKHUHLVQRJHQXLQHLVVXHDVWRDQ\PDWHULDOIDFWDQG>@WKH PRYLQJSDUW\LVHQWLWOHGWRDMXGJPHQWDVDPDWWHURIODZl 6HH)HG5&LY3 F /D3RLQWHY8QLWHG$XWRZRUNHUV /RFDO   )G   WK &LU     7KH SDUW\ RSSRVLQJ D PRWLRQ IRU VXPPDU\ MXGJPHQW mµPD\ QRW UHVW XSRQWKHPHUHDOOHJDWLRQVRUGHQLDORIKLVSOHDGLQJEXW  8QLWHG6WDWHVY'XVHQEHU\ 1R  1R  8QLWHG6WDWHVY'XVHQEHU\ 

PXVWVHWIRUWKVSHFLILFIDFWVVKRZLQJWKDWWKHUHLVDJHQXLQH GHVWUXFWLRQ RI KLV SHUVRQDO SURSHUW\ DUH QRW WKH LVVXHV LVVXHIRUWULDOjl$QGHUVRQY/LEHUW\/REE\,QF86 SUHVHQWHGLQWKLVFDVH,QVWHDGWKHLVVXHLVVLPSO\ZKHWKHU     TXRWLQJIRUPHU)HG5&LY3 H m7KH 'XVHQEHU\LVHQWLWOHGWRFRPSHQVDWLRQXQGHUWKDWDGPLWWHG PHUH H[LVWHQFH RI D VFLQWLOOD RI HYLGHQFH LQ VXSSRUW RI WKH FLUFXPVWDQFH SODLQWLIIjVSRVLWLRQZLOOEHLQVXIILFLHQW WKHUHPXVWEHHYLGHQFH RQZKLFKWKHMXU\FRXOGUHDVRQDEO\ILQGIRUWKHSODLQWLIIl,G $FTXLVLWLRQ RI SURSHUW\ WKURXJK GUXJ SURFHHGV DIIHFWV D DW FODLPDQWjVULJKWWRWKDWSURSHUW\LQIRUIHLWXUHDFWLRQV,QWKLV FLUFXLW mRQH QHYHU DFTXLUHV D SURSHUW\ ULJKW WR >GUXJ@ :H FRQFOXGH ILUVW WKDW VXPPDU\ MXGJPHQW IRU WKH SURFHHGV ZKLFK LQFOXGH QRW RQO\ FDVK EXW DOVR SURSHUW\ JRYHUQPHQWZDVSURSHUUHJDUGLQJWKH  LQFDVK7KH VHFXUHGZLWKWKHSURFHHGVRILOOHJDODFWLYLW\l8QLWHG6WDWHV JRYHUQPHQWKDVSURYLGHGSHUVXDVLYHHYLGHQFHWKDWDSULVRQ Y6DOLQDV)G WK&LU  6HHDOVR8QLWHG PDLOURRPHPSOR\HHVLJQHGWKHFHUWLILHGPDLOUHFHLSW7KH 6WDWHVY7LOOH\)G  WK&LU   6RPHRQH JRYHUQPHQW KDV RIIHUHG WKH DIILGDYLW RI sDPHV /DZVRQ DQ ZKR SXUFKDVHV SURSHUW\ ZLWK GUXJ SURFHHGV mKDV QR ,QPDWH 6\VWHPV 2IILFHU DW WKH 0LODQ )DFLOLW\  /DZVRQ UHDVRQDEOHH[SHFWDWLRQWKDWWKHODZZLOOSURWHFWFRQGRQHRU DWWHVWHGWKDWKHVLJQHGWKHFHUWLILHGPDLOUHFHLSWDQGGHVFULEHG HYHQ DOORZ KLV FRQWLQXHG SRVVHVVLRQ RI VXFK SURFHHGV WKH SURFHVV IRU IRUZDUGLQJ SULVRQ PDLO WR WKH LQPDWHV EHFDXVHWKH\KDYHWKHLUYHU\JHQHVLVLQLOOHJDODFWLYLW\l  /DZVRQjV GHSRVLWLRQ WHVWLPRQ\ LV FRQVLVWHQW ZLWK KLV DIILGDYLW 'XVHQEHU\jV DGPLVVLRQ DERXW GUXJ SURFHHGV FRPELQHG ZLWKKLVWHVWLPRQ\WKDWKHKDGEHHQXQHPSOR\HGVLQFH  1RWZLWKVWDQGLQJ 'XVHQEHU\jV FRQWHQWLRQ WKDW KH GLG QRW WZR \HDUV EHIRUH DQ\ RI WKH LWHPV RU WKH FDU DW LVVXH ZDV UHFHLYHDFWXDOQRWLFHWKLVQRWLFHZDVmUHDVRQDEO\FDOFXODWHG SXUFKDVHGOHDGVWRWKHFRQFOXVLRQWKDWWKHSHUVRQDOSURSHUW\ XQGHUDOOWKHFLUFXPVWDQFHVWRDSSULVH>KLP@RIWKHSHQGHQF\ DQG WKH FDU LQYROYHG ZHUH SXUFKDVHG ZLWK GUXJ SURFHHGV RIWKHDFWLRQDQGDIIRUG>KLP@DQRSSRUWXQLW\WRSUHVHQW>KLV@ 'XVHQEHU\ KDG QR SURSHUW\ ULJKWV WKHUHIRUH LQ WKH 0RQWH REMHFWLRQVl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jVRSLQLRQUHPDQGLQJWKLVFDVHWRWKHGLVWULFWFRXUWIRU MXGJPHQW IRU WKH JRYHUQPHQW ZDV SURSHU UHJDUGLQJ DOO GHWHUPLQDWLRQDVWRWKHVXIILFLHQF\RIQRWLFHDQGLVWKHPRVW SHUVRQDOSURSHUW\LQFOXGLQJFDVKDQGWKHDXWRPRELOH UHFHQWUHIOHFWLRQRI6L[WK&LUFXLWODZRQSRLQW $FFRUGLQJO\WKHGLVWULFWFRXUWjVMXGJPHQWLV$)),50(' $W WKH KHDULQJ WR GHWHUPLQH WKH YDOXH RI WKH SHUVRQDO SURSHUW\ 'XVHQEHU\ DGPLWWHG WKDW WKH FDU DQG SHUVRQDO SURSHUW\ ZHUH SXUFKDVHG ZLWK GUXJ SURFHHGV  7KXV WKH VXIILFLHQF\RIQRWLFHUHJDUGLQJIRUIHLWXUHRIWKH0RQWH&DUOR RU YLRODWLRQ RI 'XVHQEHU\jV GXH SURFHVV ULJKWV XSRQ WKH