5(&200(1'(' )25 )8//7(;7 38%/,&$7,21  %XUGHQHWDOY&KHFN,QWR 1R 3XUVXDQW WR 6L[WK &LUFXLW 5XOH 

&DVKRI.<HWDO (/(&7521,& &,7$7,21  )(' $SS  3 WK &LU )LOH 1DPH D S

'HIHQGDQWVjPRWLRQWRFRPSHODUELWUDWLRQ)XUWKHUZHRQO\ UHPDQG3ODLQWLIIVjDOOHJDWLRQVWKDWWKHDUELWUDWLRQDJUHHPHQWV 81,7('67$7(6&28572)$33($/6 VHSDUDWHIURPWKHORDQDJUHHPHQWVDUHQRWHQIRUFHDEOHDJDLQVW WKHP RQ mµJURXQGV DV H[LVW DW ODZ RU LQ HTXLW\ IRU WKH )257+(6,;7+&,5&8,7 UHYRFDWLRQRIDQ\FRQWUDFWjl'RFWRUjV$VVRFV86DW BBBBBBBBBBBBBBBBB  TXRWLQJ 86&†  &21&/86,21 %(9(5/< %85'(1HWDO ; )RUWKHDERYHUHDVRQVZH9$&$7(WKHGLVWULFWFRXUWjV 3ODLQWLIIV$SSHOOHHV  RUGHUDQG5(0$1'IRUIXUWKHUFRQVLGHUDWLRQRI'HIHQGDQWVj  PRWLRQWRFRPSHODUELWUDWLRQLQOLJKWRI3ODLQWLIIVjDOOHJDWLRQV  1R WKDWWKHDUELWUDWLRQDJUHHPHQWVDUHXQHQIRUFHDEOHRQJURXQGV Y  WKDWWKHDJUHHPHQWVZRXOGLPSRVHEXUGHQVRPHFRVWVGHQ\ !  VWDWXWRU\ULJKWVDQGFRQVWLWXWHDQXQLQIRUPHGZDLYHURIMXU\ &+(&. ,172 &$6+ 2)  WULDOULJKWV .(178&.< //&HWDO  'HIHQGDQWV$SSHOODQWV    1 $SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW IRUWKH(DVWHUQ'LVWULFWRI.HQWXFN\DW/H[LQJWRQ 1R n.DUO6)RUHVWHU&KLHI'LVWULFWsXGJH $UJXHG $XJXVW  'HFLGHGDQG)LOHG 2FWREHU ,W LV QRW XQFRPPRQ WR REWDLQ DSSHOODWH UHYLHZ RI D GLVWULFW FRXUW RUGHU GHQ\LQJ D PRWLRQ WR FRPSHO DUELWUDWLRQ EURXJKW SXUVXDQW WR WKH )$$ SULRU WR WKH GLVWULFW FRXUWjV DFWXDO GHWHUPLQDWLRQ RI WKH DOOHJDWLRQV %HIRUH &/$<DQG*,/0$1&LUFXLWsXGJHV :,6(0$1 JLYLQJ ULVH WR WKH RUGHU6HH &%6 (PSOR\HHV )HG &UHGLW 8QLRQ Y 'LVWULFWsXGJH 'RQDOGVRQ /XINLQ sHQUHWWH 6HF &RUS  )G   WK &LU    m7KH GLVWULFW FRXUW FRQFOXGHG WKDW WKH DOOHJDWLRQ RI IUDXG LQ WKLV FDVH LV RQH RI µIUDXG LQ WKH IDFWXPj DQG >WKXV@ WKH FDVH LV RQH IRU WKH FRXUW DQG QRW WKH DUELWUDWRU WR GHFLGHl 6DQGYLN $% Y $GYHQW ,QWjO &RUS  )G   G &LU  m>7@KH 'LVWULFW &RXUW FRQFOXGHG WKDW LW FRXOG QRW RUGHU DUELWUDWLRQ XQWLO LW GHWHUPLQHG WKH YDOLGLW\ RI WKH XQGHUO\LQJ FRQWUDFWl &KDVWDLQ Y 5RELQVRQ+XPSKUH\ &R ,QF  )G   WK &LU   ILQGLQJ WKDW WKH GLVWULFW FRXUWjV GHQLDO RI D PRWLRQ WR FRPSHO DUELWUDWLRQ mLPSOLFLWO\l UXOHG WKDW WKH )$$ SURVFULEHG FRPSHOOLQJ

DUELWUDWLRQ XQWLO WKH GLVWULFW FRXUW GHWHUPLQHG WKDW WKH SDUW\ UHVLVWLQJ 7KH +RQRUDEOH 7KRPDV $ :LVHPDQ sU 8QLWHG 6WDWHV 'LVWULFW DUELWUDWLRQ ZDV mFRQWUDFWXDOO\ REOLJDWHG WR VXEPLW WR DUELWUDWLRQl  sXGJH IRU WKH 0LGGOH 'LVWULFW RI 7HQQHVVHH VLWWLQJ E\ GHVLJQDWLRQ

  %XUGHQHWDOY&KHFN,QWR 1R 1R %XUGHQHWDOY&KHFN,QWR  &DVKRI.<HWDO &DVKRI.<HWDO

BBBBBBBBBBBBBBBBB DQDJUHHPHQWWRDUELWUDWHl6\GQRUY&RQVHFR)LQ6HUYV &RUS)G WK&LU  &2816(/ :HVHWRXWWKLVSUHFHGHQWDVDQLQGLFDWLRQRIWKHOLPLWHG $5*8(' %DUEDUD%(GHOPDQ',16025( 6+2+/ SURVSHFWVVXFKFODLPVXOWLPDWHO\IDFH1HYHUWKHOHVVEHFDXVH /H[LQJWRQ.HQWXFN\IRU$SSHOODQWVsRKQ20RUJDQsU WKHVHFODLPVDWWDFNWKHHQIRUFHDELOLW\RIWKHDUELWUDWLRQFODXVH /H[LQJWRQ.HQWXFN\IRU$SSHOOHHV21%5,() %DUEDUD VHSDUDWHIURPWKHXQGHUO\LQJORDQDJUHHPHQWVWKHFODLPVDUH % (GHOPDQ )UDQN 7 %HFNHU ',16025(  6+2+/ WR EH GHWHUPLQHG E\ D FRXUW QRW DQ DUELWUDWRU  :KHQ /H[LQJWRQ.HQWXFN\IRU$SSHOODQWVsRKQ20RUJDQsU GHWHUPLQLQJWKHHQIRUFHDELOLW\RIDQDUELWUDWLRQDJUHHPHQWD /H[LQJWRQ .HQWXFN\ 5LFKDUG $ )LVKHU /2*$1 FRXUWmFDQLQYHVWLJDWHWKHH[LVWHQFHRIVXFKJURXQGVDVH[LVW 7+2036210,//(5%,/%27+203621 ),6+(5 DW ODZ RU LQ HTXLW\ IRU WKH UHYRFDWLRQ RI DQ\ FRQWUDFW    &OHYHODQG 7HQQHVVHH sDFN / %ORFN 6$&+12)) +RZHYHUWKHJURXQGVIRUUHYRFDWLRQPXVWUHODWHVSHFLILFDOO\ :($9(5&KLFDJR,OOLQRLVIRU$SSHOOHHV WR WKH DUELWUDWLRQ FODXVH DQG QRW MXVW WR WKH FRQWUDFW DV D ZKROHl+RRWHUVRI$PY3KLOOLSV)G   WK BBBBBBBBBBBBBBBBB &LU FLWLQJ 86&† 3ULPD3DLQW86DW   LQWHUQDOTXRWDWLRQPDUNVRPLWWHG  23,1,21 BBBBBBBBBBBBBBBBB :HQRWHWKDWWKHGLVWULFWFRXUWjVRUGHULQWKLVFDVHGHQ\LQJ 'HIHQGDQWVjPRWLRQWRFRPSHODUELWUDWLRQZDVEDVHGRQO\RQ &/$< &LUFXLW sXGJH  'HIHQGDQWV &KHFN ,QWR &DVK RI WKHSUHOLPLQDU\GHWHUPLQDWLRQWKDW3ODLQWLIIVKDGDOOHJHGYRLG .HQWXFN\ //& DQG : $OODQ sRQHV sU DSSHDO IURP WKH DELQLWLRFRQWUDFWVZLWKRXWDVXEVHTXHQWGHWHUPLQDWLRQWKDW GLVWULFW FRXUWjV RUGHU GHQ\LQJ 'HIHQGDQWVj PRWLRQ EURXJKW WKH FRQWUDFWV ZHUH DFWXDOO\ YRLG DE LQLWLR  $OOHJDWLRQV SXUVXDQWWRWKH)HGHUDO$UELWUDWLRQ$FW m)$$l  86&† FRQFHUQLQJWKHYDOLGLW\RIDQDUELWUDWLRQDJUHHPHQWmVKRXOG HWVHTWRFRPSHODUELWUDWLRQRIFODLPVEURXJKWE\3ODLQWLIIV RUGLQDULO\EHGHFLGHGLQWKHWULDOFRXUWEHIRUHILQDOUHVROXWLRQ %HYHUO\%XUGHQ&KDSWHUEDQNUXSWF\WUXVWHHIRUPXOWLSOH RIDPRWLRQWRFRPSHODUELWUDWLRQl&KDVWDLQ )GDW HVWDWHVHWDODOOHJLQJYLRODWLRQVRIIHGHUDODQG.HQWXFN\ODZ FLWDWLRQVRPLWWHG HPSKDVLVRPLWWHG $FFRUGLQJO\EHFDXVH DULVLQJIURPKLJKLQWHUHVWORDQDJUHHPHQWVEHWZHHQ3ODLQWLIIV WKH GLVWULFW FRXUW PHUHO\ LGHQWLILHG DQG GLG QRW GHFLGH DQG'HIHQGDQWV:H9$&$7(WKHGLVWULFWFRXUWjVRUGHUDQG 3ODLQWLIIVj DOOHJDWLRQV FRQFHUQLQJ WKH H[LVWHQFH DQG 5(0$1'IRUIXUWKHUFRQVLGHUDWLRQRI'HIHQGDQWVjPRWLRQ HQIRUFHDELOLW\ RI WKH DUELWUDWLRQ DJUHHPHQWV ZH GR QRW WRFRPSHODUELWUDWLRQLQOLJKWRI3ODLQWLIIVjDOOHJDWLRQVWKDWWKH FRQVWUXH LWV RUGHU LQ WKLV FDVH WR EH D ILQDO UHVROXWLRQ RI DUELWUDWLRQDJUHHPHQWVDUHXQHQIRUFHDEOHGXHWREXUGHQVRPH FRVWV GHQLDO RI VWDWXWRU\ ULJKWV DQG XQLQIRUPHG ZDLYHU RI MXU\WULDOULJKWV

 1RWDEO\ KRZHYHU WKH DUELWUDWLRQ DJUHHPHQW LQ 6\GQRU XQOLNH WKH DUELWUDWLRQ DJUHHPHQWV LQ WKLV FDVH FRQWDLQHG DQ H[SUHVV ZDLYHU RI MXU\ WULDO SURYLVLRQ 6\GQRU Y &RQVHFR )LQ 6HUYV &RUS  )G   WK &LU    %XUGHQHWDOY&KHFN,QWR 1R 1R %XUGHQHWDOY&KHFN,QWR  &DVKRI.<HWDO &DVKRI.<HWDO

IUDXGXOHQWVFKHPH7KXVLQDGGLWLRQWRWKHFODLPjVIDLOXUHWR %$&.*5281' VXUYLYH3ULPD3DLQWLWLVDOVRZDLYHG6HH)RVWHUY%DULORZ )G WK&LU   3URFHGXUDO+LVWRU\ $VLGH IURP IUDXG 3ODLQWLIIV UDLVH VHYHUDO DOWHUQDWLYH 3ODLQWLIIVILOHGWKHLURULJLQDOFRPSODLQWLQWKHGLVWULFWFRXUW JURXQGVRQZKLFKWKHDUELWUDWLRQDJUHHPHQWVVKRXOGEHIRXQG RQ$SULO ZKLFKZDVDPHQGHGRQ0D\ 2Q XQHQIRUFHDEOH3ODLQWLIIVKLJKOLJKWWKHLUSDUWLFXODUSRVLWLRQDV sXO\ 3ODLQWLIIVILOHGWKHLUVHFRQGDPHQGHGFRPSODLQW XQVRSKLVWLFDWHGFRQVXPHUVRIOLPLWHGHGXFDWLRQDQGPHDQVDV DOOHJLQJYLRODWLRQVRIWKH7UXWKLQ/HQGLQJ$FW m7,/$l  D NH\ IDFWRU LQ GHWHUPLQLQJ WKH HQIRUFHDELOLW\ RI WKH 86&†HWVHTWKH5DFNHWHHU,QIOXHQFHGDQG&RUUXSW DUELWUDWLRQ DJUHHPHQWV  7KHVH DOWHUQDWLYH JURXQGV 2UJDQL]DWLRQ $FW  86& †   HW VHT DQG VHYHUDO VSHFLILFDOO\ WKDW DUELWUDWLRQ LQ WKLV FDVH ZRXOG LPSRVH FRQVXPHUSURWHFWLRQVWDWXWHVXQGHU.HQWXFN\ODZ2QsXQH EXUGHQVRPH FRVWV GHQ\ VWDWXWRU\ ULJKWV DQG FRQVWLWXWH DQ  'HIHQGDQWVPRYHGWRFHUWLI\DTXHVWLRQRIODZWRWKH XQLQIRUPHG ZDLYHU RI MXU\ WULDO ULJKWV DWWDFN WKH .HQWXFN\6XSUHPH&RXUW ZKHWKHUIHHVFKDUJHGE\DOLFHQVHG HQIRUFHDELOLW\RIWKHDUELWUDWLRQFODXVHLWVHOIVHSDUDWHIURPWKH FKHFN FDVKLQJ FRPSDQ\ FRQVWLWXWHG LQWHUHVW VXEMHFW WR XQGHUO\LQJORDQDJUHHPHQWV .HQWXFN\XVXU\ODZV2Q$XJXVW WKHGLVWULFWFRXUW RUGHUHG 3ODLQWLIIVj DFWLRQ WR EH KHOG LQ DEH\DQFH SHQGLQJ  8QGHUWKH)$$JHQHUDOO\DYDLODEOHFRQWUDFWGHIHQVHVVXFK UHVROXWLRQRIWKHTXHVWLRQE\WKH.HQWXFN\6XSUHPH&RXUW DV IUDXG GXUHVV RU XQFRQVFLRQDELOLW\ PD\ EH DSSOLHG WR LQYDOLGDWHDUELWUDWLRQDJUHHPHQWV'RFWRUjV$VVRFV,QFY 2QsXQH WKH.HQWXFN\6XSUHPH&RXUWDQVZHUHG &DVDURWWR86   :HQRWHKRZHYHUWKDW WKHFHUWLILHGTXHVWLRQILQGLQJWKDWDFKHFNFDVKLQJFRPSDQ\ 3ODLQWLIIVjFODLPVDVWRWKHXQHQIRUFHDELOLW\RIWKHDUELWUDWLRQ OLFHQVHG XQGHU .HQWXFN\ 5HYLVHG 6WDWXWHV †  HW VHT DJUHHPHQWVVHSDUDWHIURPWKHORDQDJUHHPHQWVJRHVDJDLQVW ZKLFK FKDUJHV D mVHUYLFH IHHl IRU DFFHSWLQJ DQG GHIHUULQJ VWURQJSUHFHGHQW$VWRWKHSRWHQWLDOO\EXUGHQVRPHFRVWVRI GHSRVLWRQFKHFNVSXUVXDQWWRDJUHHPHQWVZLWKWKHPDNHUVRI DUELWUDWLRQWKHSDUW\UHVLVWLQJDUELWUDWLRQKDVWKHEXUGHQRI WKH FKHFNV WKHUHE\ FKDUJHV mLQWHUHVWl VXEMHFW WR WKH XVXU\ VKRZLQJ WKH OLNHOLKRRG WKDW mDUELWUDWLRQ ZRXOG EH ODZV DQG GLVFORVXUH SURYLVLRQV XQGHU †   6HH :KLWH Y SURKLELWLYHO\H[SHQVLYHl*UHHQ7UHH)LQ&RUSY5DQGROSK &KHFN+ROGHUV,QF 6:G  .\  86   $VWR3ODLQWLIIVjZDLYHURIVWDWXWRU\ FODVV DFWLRQ ULJKWV LW LV 3ODLQWLIIVj EXUGHQ WR VKRZ WKDW 2Q 'HFHPEHU    3ODLQWLIIV PRYHG WR SURFHHG DV D &RQJUHVVLQWHQGHGVXFKULJKWVWREHQRQZDLYDEOHDEXUGHQ FODVVDFWLRQSXUVXDQWWR)HG5&LY3 F  'HIHQGDQWV WKDW WKH (OHYHQWK &LUFXLW UHFHQWO\ IRXQG KDG QRW EHHQ PHW WKHUHDIWHU PRYHG IRU DQ H[WHQVLRQ RI WLPH WR UHVSRQG WR XQGHU7,/$5DQGROSKY*UHHQ7UHH)LQ&RUS)G 3ODLQWLIIVjPRWLRQ2QsDQXDU\'HIHQGDQWVILOHGD  WK&LU $VWRWKHIDLOXUHRIWKHDUELWUDWLRQ PRWLRQ XQGHU WKH )$$ WR FRPSHO DUELWUDWLRQ RI FODLPV FODXVHWRLQFOXGHDMXU\ZDLYHUSURYLVLRQmWKHORVVRIWKHULJKW EURXJKW E\ 3ODLQWLIIV DQG WR VWD\ OLWLJDWLRQ SHQGLQJ WRDMXU\WULDOLVDQHFHVVDU\DQGIDLUO\REYLRXVFRQVHTXHQFHRI DUELWUDWLRQ7KHGLVWULFWFRXUWGHQLHG'HIHQGDQWVjPRWLRQRQ 0D\DQGLWLVIURPWKLVRUGHUWKDW'HIHQGDQWVQRZ DSSHDO  %XUGHQHWDOY&KHFN,QWR 1R 1R %XUGHQHWDOY&KHFN,QWR  &DVKRI.<HWDO &DVKRI.<HWDO

)DFWV VXIILFLHQWWRRYHUFRPHWKHVWURQJIHGHUDOSROLF\LQIDYRURI DUELWUDWLRQl 3ODLQWLII%XUGHQLVWUXVWHHIRUIRXUEDQNUXSWF\HVWDWHVLQWKLV FDVH  7KH LQGLYLGXDO 3ODLQWLIIV DUH UHVLGHQWV RI /H[LQJWRQ 6SHFLILFDOO\IRUDFRPSODLQWRIIUDXGLQWKHLQGXFHPHQWWR .HQWXFN\  'HIHQGDQW &KHFN ,QWR &DVK FUHGLWRU RI WKH VXUYLYH 3ULPD 3DLQW WKH FRPSODLQW PXVW FRQWDLQ mD EDQNUXSWF\ HVWDWHV DQG LQGLYLGXDO 3ODLQWLIIV LQ WKLV FDVH LV ZHOOIRXQGHG FODLP RI IUDXG LQ WKH LQGXFHPHQW RI WKH LQFRUSRUDWHGDQGGRHVEXVLQHVVLQ.HQWXFN\'HIHQGDQW: DUELWUDWLRQ FODXVH LWVHOI VWDQGLQJ DSDUW IURP WKH ZKROH $OODQsRQHVsULVDPDMRULW\RZQHUDQGPDQDJLQJRIILFHURI DJUHHPHQWWKDWZRXOGSURYLGHJURXQGVIRUWKHUHYRFDWLRQRI &KHFN,QWR&DVK WKH DJUHHPHQW WR DUELWUDWHl  $UQROG  )G DW  HPSKDVLVLQRULJLQDO 7KHRQO\DVSHFWRI3ODLQWLIIVjIUDXG 3ODLQWLIIV DOOHJH WKDW 'HIHQGDQWV KDYH ORDQHG PRQH\ DW DOOHJDWLRQV ZKLFK FRQFHUQV WKH DUELWUDWLRQ DJUHHPHQWV XVXULRXVLQWHUHVWUDWHVWRKXQGUHGVRI.HQWXFN\FRQVXPHUV VWDQGLQJ DSDUW IURP WKH ORDQ DJUHHPHQWV LV WKH FODLP WKDW 7KHFRQVXPHUVHQWHUHGLQWRmFKHFNFDVKLQJDJUHHPHQWVlZLWK 3ODLQWLIIVZHUHQRWDZDUHWKDWWKHDUELWUDWLRQFODXVHVKDGEHHQ 'HIHQGDQWV WKH mORDQ DJUHHPHQWVl   8QGHU WKH ORDQ DGGHGWRWKHUHYHUVHVLGHRIWKHORDQDJUHHPHQWVLQ'HFHPEHU DJUHHPHQWV'HIHQGDQWVZRXOGSURYLGHDERUURZHUZLWKIRU RI +RZHYHURQHZKRVLJQVDFRQWUDFWLVSUHVXPHGWR H[DPSOHLQFDVKLQH[FKDQJHIRUDFKHFNLQWKHDPRXQW NQRZLWVFRQWHQWV6WRXW)GDW RI   7KH ORDQ DJUHHPHQW ZRXOG UHIHU WR WKH  GLIIHUHQFHDVDmILQDQFHFKDUJHlZKLFKWKHDJUHHPHQWVWDWHG 3ODLQWLIIVjmIUDXGXOHQWVFKHPHlFODLPLVXQDYDLOLQJEHFDXVH mLVGHHPHGDVHUYLFHIHHE\.HQWXFN\ODZDQGQRWLQWHUHVW QRDVSHFWRIWKHFODLPFRQFHUQVWKHDUELWUDWLRQDJUHHPHQWV .56  l s$DW VHSDUDWH IURP WKH ORDQ DJUHHPHQWV  7KDW LV XQGHU 3ULPD 3DLQWDQG$UQROG3ODLQWLIIVj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mVHUYLFHIHHl  H[HFXWLQJ D UHSODFHPHQW FKHFN LQ WKH VDPH DPRXQW DV WKH :H QRWH WKDW WKH SDUWLFXODU FLUFXPVWDQFHV VXUURXQGLQJ 'HIHQGDQWVj SUHVHQWDWLRQ RI WKH DUELWUDWLRQ DJUHHPHQWV LQ WKLV FDVH DSSHDU VXVSHFW QRW RULJLQDOFKHFNDQGHVWDEOLVKLQJDQHZSD\PHQWGXHGDWHWZR EHFDXVH WKH DUELWUDWLRQ FODXVHV ZHUH SODFHG RQ WKH EDFN RI WKH ORDQ ZHHNV IURP WKH UROORYHU GDWH  3ODLQWLIIV DOOHJH WKDW DJUHHPHQWV ZLWKRXW DQQRXQFHPHQW EXW UDWKHU EHFDXVH SULRU WR VXFK 'HIHQGDQWVFRHUFHGERUURZHUVLQWRUROOLQJRYHUWKHLUGHEWE\ SODFHPHQW 3ODLQWLIIV KDG UHJXODUO\ HQWHUHG LQWR RWKHUZLVH LGHQWLFDO ORDQ WKUHDWHQLQJRWKHUZLVHWRSURVHFXWHXQGHUWKH.HQWXFN\mEDG DJUHHPHQWV WKDW KDG QR DUELWUDWLRQ FODXVH 1HYHUWKHOHVV 3ODLQWLIIV RIIHU

FKHFNl ODZ  6HH .\ 5HY 6WDW $QQ †  %DQNV QR OHJDO DXWKRULW\ IRU WKH SRVLWLRQ WKDW 'HIHQGDQWV KDG D GXW\ WR LQIRUP WKHP RI WKHLU LQVHUWLRQ RI WKH DUELWUDWLRQ FODXVHV %DOGZLQ    7KH ORDQ DJUHHPHQWV DW LVVXH FRQWDLQHG DQ DUELWUDWLRQ 6LPLODUO\ DQ DGGLWLRQDO FODLP RI 3ODLQWLIIV WKDW WKH DUELWUDWLRQ DJUHHPHQWV DUH XQHQIRUFHDEOH EHFDXVH WKH\ ZHUH FRQWDLQHG LQ FRQWUDFWV FODXVHRQWKHUHYHUVHVLGHRIWKHORDQDJUHHPHQWZKLFKUHDG RI DGKHVLRQ DOVR GRHV QRW FRQFHUQ WKH PDNLQJ RI WKH DUELWUDWLRQ DVIROORZV DJUHHPHQWV EHFDXVH WKH FODLP GRHV QRW DWWDFN WKH DUELWUDWLRQ FODXVH VHSDUDWH IURP WKH XQGHUO\LQJ ORDQ DJUHHPHQWV  %XUGHQHWDOY&KHFN,QWR 1R 1R %XUGHQHWDOY&KHFN,QWR  &DVKRI.<HWDO &DVKRI.<HWDO

FRQWUDFW LQFOXGLQJWKHDUELWUDWLRQFODXVH LVIRUWKHDUELWUDWRU $5%,75$7,21 7RSXUVXHDQ\FODLPGHPDQGGLVSXWH ZKLOH D FKDOOHQJH EDVHG RQ WKH ODFN RI PXWXDOLW\ RI WKH RU FDXVH RI DFWLRQ D mFODLPl  DULVLQJ XQGHU WKLV DUELWUDWLRQFODXVHZRXOGEHIRUWKHFRXUWl0DWWHUKRUQ,QF $JUHHPHQWRUWKHWUDQVDFWLRQLQFRQQHFWLRQZLWKZKLFK Y1&5&RUS)G WK&LU   FLWDWLRQV WKLV $JUHHPHQW KDV EHHQ H[HFXWHG WKH FODLPDQW PXVW RPLWWHG m,IWKHIUDXGUHODWHVWRWKHDUELWUDWLRQFODXVHLWVHOI VXEPLWWRWKHRWKHUSDUW\LQZULWLQJDQH[SODQDWLRQRIWKH WKHFRXUWVKRXOGDGMXGLFDWHWKHIUDXGFODLPl)HUUR&RUSY FODLP DQG D GHPDQG WKDW WKH FODLP EH UHVROYHG E\ *DUULVRQ,QGXV)G   WK&LU   TXRWLQJ DUELWUDWLRQ  ,I WKH RWKHU SDUW\ GRHV QRW UHVSRQG WR WKH 503HUH] $VVRFV,QFY:HOFK )G  WK VXEPLWWDOLQZULWLQJZLWKLQWHQ  GD\VRILWVUHFHLSW &LU  %HFDXVHWKHGLVWULFWFRXUWUHOLHGRQ7KUHH9DOOH\V WKH FODLPDQW PD\ SXUVXH WKH FODLP HLWKHU WKURXJK LQ GHQ\LQJ 'HIHQGDQWVj PRWLRQ WR FRPSHO DUELWUDWLRQ DUELWUDWLRQRUFRXUWDFWLRQ,IWKHRWKHUSDUW\UHVSRQGVWR 3ODLQWLIIVjDOOHJDWLRQVFRQFHUQLQJWKHPDNLQJRIWKHDUELWUDWLRQ WKH VXEPLWWDO LQ ZULWLQJ ZLWKLQ WHQ   GD\V RI LWV DJUHHPHQWV VHSDUDWH IURP WKH ORDQ DJUHHPHQWV ZHUH QRW UHFHLSW WKH FODLP PXVW EH VXEPLWWHG WR ELQGLQJ FRQVLGHUHG DUELWUDWLRQ LQ DFFRUGDQFH ZLWK DQG SXUVXDQW WR WKH 8QLIRUP $UELWUDWLRQ $FW DV HQDFWHG LQ WKH $OWKRXJK&%6(PSOR\HHVGHFOLQHGWRDGRSWWKHIUDXGLQ &RPPRQZHDOWKRI.HQWXFN\.56HWVHTDV WKHIDFWXPIUDXGLQWKHLQGXFHPHQWGLVWLQFWLRQZKHQDSSO\LQJ DPHQGHGIURPWLPHWRWLPH WKHm$FWl 7KHDUELWUDWLRQ 3ULPD3DLQWQHYHUWKHOHVVWKLV&RXUWUHPDQGHGWRWKHGLVWULFW VKDOOEHFRQGXFWHGE\RQHRUPRUHDUELWUDWRUVVHOHFWHGE\ FRXUWLQWKDWFDVHDOOHJDWLRQVRIIUDXGLQWKHLQGXFHPHQWRIWKH DJUHHPHQWEHWZHHQ\RXDQG&KHFN,QWR&DVKEXWLIQR DUELWUDWLRQDJUHHPHQWLWVHOI&%6(PSOR\HHVFKDUDFWHUL]HG DJUHHPHQW RQ WKH DUELWUDWRU>V@ FDQ EH UHDFKHG E\ WKH WKH 3ULPD 3DLQW TXHVWLRQ DV mZKHWKHU &%6j IUDXG FODLP .HQWXFN\'LVWULFW&RXUWIRUFODLPVLQYROYLQJRU LQYROYHV WKH PDNLQJ RI WKH DUELWUDWLRQ FODXVHl  &%6 OHVVRUWKH.HQWXFN\&LUFXLW&RXUWLQHLWKHUFDVHLQWKH (PSOR\HHV  )G DW   6SHFLILFDOO\ ZKHUH mWKH FRXQW\ZKHUHWKLV$JUHHPHQWZDVVLJQHG7KHH[SHQVHV SODLQWLII DIILUPDWLYHO\ SOHDGV WKDW WKH FRQWUDFW DQG WKH RIWKHDUELWUDWLRQLQFOXGLQJDWWRUQH\jVIHHVZLOOEHSDLG DUELWUDWLRQDJUHHPHQWLQFOXGHGWKHUHLQZHUHSURFXUHGWKURXJK LQDFFRUGDQFHZLWKWKHDZDUGLVVXHGE\WKHDUELWUDWRU>V@ IUDXG WKH FRXUW VKRXOG GHWHUPLQH ZKHWKHU WKH DUELWUDWLRQ 7KHILQDOLW\DQGELQGLQJHIIHFWRIWKHDUELWUDWLRQDZDUG FODXVHZDVXVHGWRIXUWKHUWKHIUDXGXOHQWVFKHPHl,G VKDOOEHDVVHWIRUWKLQWKH$FW 3ODLQWLIIVLQWKLVFDVHDOOHJHXQGHU&%6(PSOR\HHVWKDW s$DW  WKHDUELWUDWLRQDJUHHPHQWVZHUHXVHGWRIXUWKHUDIUDXGXOHQW VFKHPH+RZHYHU3ODLQWLIIVIDLOWRLGHQWLI\LQFRQQHFWLRQ .HQWXFN\jV 8QLIRUP $UELWUDWLRQ $FW SURYLGHV WKDW m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l   WK&LU  WKLV&RXUWQRWHGWKDWXQGHU .\5HY6WDW$QQ† %DQNV%DOGZLQ   3ULPD3DLQWSOHDGLQJWKDWDQDUELWUDWLRQFODXVHmZDVSDUWRI DEURDGHUIUDXGXOHQWVFKHPHZLWKRXWPRUHLVQRORQJHU 3ODLQWLIIVFRQWHQGWKDWSULRUWR'HFHPEHURI WKHORDQ DJUHHPHQWV GLG QRW LQFOXGH DQ DUELWUDWLRQ FODXVH RQ WKH  %XUGHQHWDOY&KHFN,QWR 1R 1R %XUGHQHWDOY&KHFN,QWR  &DVKRI.<HWDO &DVKRI.<HWDO

UHYHUVHVLGHRIWKHORDQDJUHHPHQWIRUP3ODLQWLIIVIXUWKHU FKDUDFWHU RU HVVHQWLDO WHUPV RI D SURSRVHG FRQWUDFWl FRQWHQGWKDW'HIHQGDQWVQHYHULQIRUPHGWKHPRIWKHDGGLWLRQ 5HVWDWHPHQW 6HFRQG RI&RQWUDFWV†FPWD    RI WKH DUELWUDWLRQ FODXVH DQG WKDW 3ODLQWLIIV RQO\ EHFDPH DZDUH RI WKH FODXVH ZKHQ 'HIHQGDQWV DWWDFKHG LW WR WKHLU 3ODLQWLIIVjDOOHJDWLRQVSULPDULO\FRQFHUQWKHVXEVWDQFHRI PRWLRQWRFRPSHODUELWUDWLRQ WKHORDQDJUHHPHQWVZKLFK3ODLQWLIIVWKHQDUJXHDUHmYRLGl XQGHU† +RZHYHUXQOLNHWKH7KUHH9DOOH\VOLQHRI ',6&866,21 FDVHV3ODLQWLIIVDOOHJDWLRQVXQGHU† GRQRWFRQFHUQ WKHLU IDLOXUH WR DVVHQW WR WKH ORDQ DJUHHPHQWV DQG GR QRW 7KLV &RXUW UHYLHZV GH QRYR D GLVWULFW FRXUWjV UXOLQJ RQ FRQFHUQVLJQDWRU\SRZHU$FFRUGLQJO\EHFDXVH3ODLQWLIIVj ZKHWKHUWRFRPSHODUELWUDWLRQSXUVXDQWWRWKH)$$6WRXWY DOOHJDWLRQVXQGHU† FKDOOHQJHWKHVXEVWDQFHUDWKHU s'%\ULGHU)G  WK&LU 8QGHUWKH WKDQ WKH H[LVWHQFH RI WKH ORDQ DJUHHPHQWV ZH YDFDWH WKH )$$DGLVWULFWFRXUWjVFRQVLGHUDWLRQRIDPRWLRQWRFRPSHO GLVWULFW FRXUWjV DSSOLFDWLRQ RI 7KUHH 9DOOH\V WR WKRVH DUELWUDWLRQ LV OLPLWHG WR GHWHUPLQLQJ ZKHWKHU WKH SDUWLHV DOOHJDWLRQV HQWHUHGLQWRDYDOLGDJUHHPHQWWRDUELWUDWHDQGGRHVQRWUHDFK WKHPHULWVRIWKHSDUWLHVjFODLPV*UHDW:0RUWJDJH&RUS )XUWKHUDOWKRXJK3ODLQWLIIVjDOOHJDWLRQVXQGHU†GR Y3HDFRFN)G G&LU   FRQFHUQVLJQDWRU\SRZHULQWKDW'HIHQGDQWVZHUHDOOHJHGO\ QRW OLFHQVHG WR HQWHU LQWR WKH ORDQ DJUHHPHQWV DQG WKXV 7KHGLVWULFWFRXUWFRQFOXGHGSULPDULO\XQGHU7KUHH9DOOH\V 3ODLQWLIIV FRQWHQG KDG QR DXWKRULW\ WR HQWHU LQWR WKH ORDQ 0XQLFLSDO :DWHU 'LVWULFW Y () +XWWRQ  &R  )G DJUHHPHQWVZHPXVWQHYHUWKHOHVVYDFDWHWKHGLVWULFWFRXUWjV   WK&LU  WKDW3ODLQWLIIVjDOOHJDWLRQVWKDWWKH DSSOLFDWLRQ RI 7KUHH 9DOOH\V WR WKH DOOHJDWLRQV XQGHU ORDQDJUHHPHQWVFRQWDLQLQJWKHDUELWUDWLRQFODXVHZHUHYRLG †DVZHOO)LUVW3ODLQWLIIVKDYHQRWDGGUHVVHGZK\ DELQLWLRPXVWEHGHWHUPLQHGE\DFRXUWQRWDQDUELWUDWRU 7KUHH9DOOH\VUDWKHUWKDQ&%6(PSOR\HHVVKRXOGFRQWURO 'HIHQGDQWVFRQWHQGWKDWXQGHU3ULPD3DLQW&RUSY)ORRG WKHGHWHUPLQDWLRQRIWKHLUDOOHJDWLRQV6HFRQG3ODLQWLIIVKDYH &RQNOLQ0IJ&R86    3ODLQWLIIVjDOOHJDWLRQV QRW DGGUHVVHG WKH GLVWLQFWLRQ EHWZHHQ HQWHULQJ LQWR D ORDQ RIYRLGORDQDJUHHPHQWVDUHWREHGHWHUPLQHGE\DQDUELWUDWRU DJUHHPHQWZLWKDQXQOLFHQFHGOHQGHUDQGQRWDVVHQWLQJWRD ORDQDJUHHPHQWDWDOO$OWKRXJK†OLNHWKH7KUHH 8QGHUVHFWLRQRIWKH)$$ZKHQDQDFWLRQLVEURXJKWLQ 9DOOH\VOLQHRIFDVHVUDLVHVDTXHVWLRQRIVLJQDWRU\SRZHUWKH IHGHUDOFRXUWmXSRQDQ\LVVXHUHIHUDEOHWRDUELWUDWLRQXQGHU TXHVWLRQLQWKLVFDVHLVGLIIHUHQWLQWKDWWKHVLJQDWRU\LVVXH DJUHHPHQW LQ ZULWLQJ IRU VXFK DUELWUDWLRQl WKH FRXUW PXVW DULVHVRQO\RQWKHVLGHRIWKHSDUWLHVPRYLQJIRUDUELWUDWLRQ mVWD\WKHDFWLRQSHQGLQJDUELWUDWLRQRQFHLWLVVDWLVILHG :KHWKHU 7KUHH 9DOOH\V UHTXLUHV WKDW SDUWLHV UHVLVWLQJ WKDWWKHLVVXHLVDUELWUDEOHXQGHUWKHDJUHHPHQWl3ULPD3DLQW DUELWUDWLRQDOOHJHWKDWWKH\QHYHUDJUHHGWRDQ\FRQWUDFWDWDOO &RUS86DWm>$@VDPDWWHURIIHGHUDOODZDQ\ LVRIQRPRPHQWKHUHEHFDXVH3ODLQWLIIVKDYHQRWDGGUHVVHG GRXEWVFRQFHUQLQJWKHVFRSHRIDUELWUDEOHLVVXHVVKRXOG EH WKHLVVXH UHVROYHGLQIDYRURIDUELWUDWLRQl:LOVRQ(OHF&RQWUDFWRUV ,QFY0LQQRWWH&RQWUDFWLQJ&RUS)G  WK 1HYHUWKHOHVV XQGHU 3ULPD 3DLQW LVVXHV UHODWLQJ WR WKH &LU   TXRWLQJ0RVHV+&RQH0HPjO+RVSY0HUFXU\ PDNLQJ RI DQ DUELWUDWLRQ DJUHHPHQW VHSDUDWH IURP WKH &RQVWU&RUS86    XQGHUO\LQJFRQWUDFWDUHWREHGHWHUPLQHGE\WKHFRXUWQRWWKH DUELWUDWRU3ULPD3DLQW86DWm6RIRUH[DPSOH 8QGHU3ULPD3DLQWDFRXUWUDWKHUWKDQDQDUELWUDWRUPD\ DFKDOOHQJHEDVHGRQIUDXGLQWKHLQGXFHPHQWRIWKHZKROH DGMXGLFDWHDFODLPRIIUDXGLQWKHLQGXFHPHQWRQO\LIWKHFODLP  %XUGHQHWDOY&KHFN,QWR 1R 1R %XUGHQHWDOY&KHFN,QWR  &DVKRI.<HWDO &DVKRI.<HWDO

 GHWHUPLQLQJ ZKHWKHU VLJQDWRU\ KDG SRZHU WR ELQG RI IUDXG FRQFHUQV WKH LQGXFHPHQW RI WKH DUELWUDWLRQ FODXVH FRPSDQ\ &KDVWDLQ )GDW GHWHUPLQLQJZKHWKHU LWVHOIQRWWKHLQGXFHPHQWRIWKHFRQWUDFWJHQHUDOO\3ULPD VLJQDWRU\KDGSRZHUWRELQGIDPLO\PHPEHU 7KUHH9DOOH\V 3DLQW86DW7KH&RXUWLQ3ULPD3DLQWIRXQG )GDW H[DPLQLQJZKHWKHUVLJQDWRU\KDGSRZHUWR WKDWDUELWUDWLRQFODXVHVZHUHmVHSDUDEOHlIURPWKHFRQWUDFWVLQ ELQG SULQFLSDOV  ,6 sRVHSK &R  )G DW  ZKLFKWKH\ZHUHLQFOXGHGDQGWKDWmDEURDGDUELWUDWLRQFODXVH GHWHUPLQLQJ ZKHWKHU DVVLJQHH RI VLJQDWRU\ KDG SRZHU WR ZLOOEHKHOGWRHQFRPSDVVDUELWUDWLRQ RI WKHFODLPWKDWWKH HQIRUFHDUELWUDWLRQDJUHHPHQW &DQFDQRQY6PLWK%DUQH\ FRQWUDFWLWVHOIZDVLQGXFHGIURPIUDXGl3ULPD3DLQW +DUULV8SKDP &R)G  WK&LU  86DWm,IWKHDUELWUDWLRQFODXVHLVQRWDWLVVXHWKHQWKH ILQGLQJ WKDW DQ DOOHJDWLRQ RI IUDXG LQ WKH IDFWXP LV DQ DUELWUDWRUZLOOGHFLGHFKDOOHQJHVWRWKHFRQWUDFWFRQWDLQLQJWKH DOOHJDWLRQ RI LQHIIHFWLYH DVVHQW WR WKH FRQWUDFW  3DU.QLW DUELWUDWLRQFODXVHl&%6(PSOR\HHV)HG&UHGLW8QLRQY 0LOOV,QFY6WRFNEULGJH)DEULFV&R)G G 'RQDOGVRQ /XINLQ  sHQUHWWH 6HF &RUS  )G  &LU   GHWHUPLQLQJZKHWKHUVLJQDWRU\KDGSRZHUWRELQG  WK&LU   FRPSDQ\ 1 ')DVKLRQV,QFY'+s,QGXV,QF)G   WK&LU   H[DPLQLQJZKHWKHUVLJQDWRU\KDG 6HYHUDORIRXUVLVWHUFLUFXLWVKDYHIRXQGWKDW3ULPD3DLQW SRZHUWRHQWHULQWRDUELWUDWLRQDJUHHPHQW  GRHVQRWDSSO\WRDOOHJDWLRQVRIQRQH[LVWHQWFRQWUDFWV6HH 6SKHUH'UDNH,QV/WGY$OO$P,QV&R)G  ,QGHHGWKH7KUHH9DOOH\VGHFLVLRQRQZKLFKWKHGLVWULFW  WK&LU 6DQGYLN$%Y$GYHQW,QWjO&RUS)G FRXUWSULPDULO\UHOLHGRIIHUHGWKHIROORZLQJH[SODQDWLRQIRU   G &LU   7KUHH 9DOOH\V  )G DW  OLPLWLQJ 3ULPD 3DLQW WR FKDOOHQJHV VHHNLQJ WR mDYRLG RU &KDVWDLQY5RELQVRQ+XPSKUH\&R,QF )G UHVFLQGlDQH[LVWLQJFRQWUDFW  WK&LU  ,6sRVHSK&RY0LFK6XJDU&R)G   WK&LU  7KH7KLUG&LUFXLWDQGWKH1LQWK $FRQWUDU\UXOHZRXOGOHDGWRXQWHQDEOHUHVXOWV3DUW\$ &LUFXLWUHVSHFWLYHO\KDYHH[SUHVVO\IRXQGWKDW3ULPD3DLQW FRXOG IRUJH SDUW\ %jV QDPH WR D FRQWUDFW DQG FRPSHO DSSOLHVWRYRLGDEOHEXWQRWYRLGFRQWUDFWV6HH6DQGYLN SDUW\%WRDUELWUDWHWKHTXHVWLRQRIWKHJHQXLQHQHVVRILWV )GDW 7KUHH9DOOH\V )GDW,QFRQWUDVWWKH VLJQDWXUH6LPLODUO\DQ\FLWL]HQRI/RV$QJHOHVFRXOG )LIWK &LUFXLW KDV IRXQG WKDW 3ULPD 3DLQW DSSOLHV HYHQ WR VLJQ D FRQWUDFW RQ EHKDOI RI WKH FLW\ DQG /RV $QJHOHV FRQWUDFWVWKDWDUHmYRLGIURPLQFHSWLRQl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m>L@I EHFDXVH RI D PLVUHSUHVHQWDWLRQ DV WR WKH FKDUDFWHU RU HVVHQWLDO WHUPV RI D SURSRVHG ODZ7KDWLVWKH7KUHH9DOOH\VOLQHRIFDVHVUHTXLUHVPRUH FRQWUDFW D SDUW\ GRHV QRW NQRZ RU KDYH UHDVRQDEOH RSSRUWXQLW\ WR NQRZ WKDQDQDOOHJDWLRQRIDVWDWXWRU\YLRODWLRQ WKHVXEVWDQFHRIWKH RI LWV FKDUDFWHU RU HVVHQWLDO WHUPV WKHQ KH QHLWKHU NQRZV QRU KDV UHDVRQ DOOHJDWLRQ PXVW FRQFHUQ VRPH mPLVUHSUHVHQWDWLRQ DV WR WKH WR NQRZ WKDW WKH RWKHU SDUW\ PD\ LQIHU IURP KLV FRQGXFW WKDW KH DVVHQWV WR WKDW FRQWUDFW ,Q VXFK D FDVH WKHUH LV QR HIIHFWLYH PDQLIHVWDWLRQ RI DVVHQW  %XUGHQHWDOY&KHFN,QWR 1R 1R %XUGHQHWDOY&KHFN,QWR &DVKRI.<HWDO &DVKRI.<HWDO

DJUHHPHQW mFDQQRW DULVH RXW RI D EURDGHU FRQWUDFW LI QR 3ULPD 3DLQW ZLWKRXW PRUH DQVZHUV WKH YRLG DE LQLWLR EURDGHU FRQWUDFW HYHU H[LVWHGl  6DQGYLN  )G DW  TXHVWLRQLQDVPXFKDV3ULPD3DLQWIDLOHGWRDGGUHVVWKHYRLG $FFRUGLQJO\3ULPD3DLQWmSUHVXPHVDQXQGHUO\LQJH[LVWHQW DELQLWLRTXHVWLRQ,QGHHGLIDQ\WKLQJZHDUHLQFOLQHGWRILQG DJUHHPHQWl,GDW WKDW3ULPD3DLQWVXSSRUWVUDWKHUWKDQSURKLELWVH[FOXGLQJ QRQH[LVWHQWFRQWUDFWVIURPWKHVHYHUDELOLW\GRFWULQHEHFDXVH $OWKRXJK WKH UHDVRQLQJ RI WKH 7KLUG 6HYHQWK (LJKWK DQ DOOHJDWLRQ RI D YRLG FRQWUDFW UDLVHV H[DFWO\ WKH VDPH 1LQWKDQG(OHYHQWK&LUFXLWVLVFOHDUWKLVUHDVRQLQJDSSHDUV TXHVWLRQDVDQDOOHJDWLRQRIDIUDXGXOHQWO\LQGXFHGDUELWUDWLRQ WREHLQWHQVLRQZLWKODQJXDJHLQ&%6(PSOR\HHVZKHUHLQ DJUHHPHQW ZKHWKHUWKHDUELWUDWRUKDVDQ\SRZHUDWDOO&I WKLV&RXUWGLVFRXQWHGWKHUROHRIWKHIUDXGLQWKHIDFWXPIUDXG 3ULPD 3DLQW  86 DW  Q m7R LPPXQL]H DQ LQ WKH LQGXFHPHQW GLVWLQFWLRQ XQGHU 3ULPD 3DLQW  7KH DUELWUDWLRQDJUHHPHQWIURPMXGLFLDOFKDOOHQJHRQWKHJURXQG 5HVWDWHPHQW SURYLGHV WKDW †  ZKLFK DGGUHVVHV YRLG RIIUDXGLQWKHLQGXFHPHQWZRXOGEHWRHOHYDWHLWRYHURWKHU FRQWUDFWVFRQFHUQVPLVUHSUHVHQWDWLRQVLQmWKHµIDFWXPjRUWKH IRUPVRIFRQWUDFWl 7KH6HYHQWK&LUFXLWUHFHQWO\FDSWXUHG µH[HFXWLRQj UDWKHU WKDQ PHUHO\ WKH µLQGXFHPHQWjl RI WKH WKHSRLQWLQIRXUZRUGV m1RFRQWUDFWQRSRZHUl6SKHUH FRQWUDFW  5HVWDWHPHQW 6HFRQG  RI &RQWUDFWV †  FPW D 'UDNH,QV)GDW 1HYHUWKHOHVVZHQHHGQRWUHDFK   )UDXGLQWKHIDFWXPRUH[HFXWLRQmWKDWLVWKHVRUWRI WKHTXHVWLRQKHUHEHFDXVHWKHGLVWULFWFRXUWjVDSSOLFDWLRQRI IUDXG WKDW SURFXUHV D SDUW\jV VLJQDWXUH WR DQ LQVWUXPHQW 7KUHH 9DOOH\V LQ WKLV FDVH ZDV HUURQHRXV DQG UHTXLUHV ZLWKRXWNQRZOHGJHRILWVWUXHQDWXUHRUFRQWHQWVlUHQGHUVD UHFRQVLGHUDWLRQ FRQWUDFW YRLG ZKLOH IUDXG LQ WKH LQGXFHPHQW UHQGHUV D FRQWUDFWPHUHO\YRLGDEOH:7/DQJOH\Y)',&86 7KH GLVWULFW FRXUW UHO\LQJ RQ 7KUHH 9DOOH\V IRXQG WKDW       FLWDWLRQVRPLWWHG  EHFDXVH3ODLQWLIIVKDGDOOHJHGWKDWWKHORDQDJUHHPHQWVZHUH YRLGDELQLWLRWKRVHDOOHJDWLRQVZHUHWREHGHWHUPLQHGE\WKH +RZHYHULQ&%6(PSOR\HHVZHREVHUYHGWKDWZKLOHWKH FRXUWUDWKHUWKDQDQDUELWUDWRU)LUVWWKHDERYHLVDFRUUHFW mIUDXGLQWKHIDFWXPIUDXGLQWKHLQGXFHPHQWGLVWLQFWLRQPD\ VWDWHPHQWRI1LQWK&LUFXLWODZEXWWKHGLVWULFWFRXUWIDLOHGWR RIIHUDOHJLWLPDWHPHDQVRIDQDO\>VLV@lWKHGLVWLQFWLRQmPD\ DGGUHVV KRZ 7KUHH 9DOOH\V FDQ EH UHFRQFLOHG ZLWK &%6 PRUH FRQIRXQG WKDQ FODULI\ WKH GLVSRVLWLYH LVVXH DQG LWV (PSOR\HHV6HFRQGWKHGLVWULFWFRXUWHUUHGZKHQFRQVWUXLQJ UHVROXWLRQl&%6(PSOR\HHV )GDW5HO\LQJRQ 3ODLQWLIIVjDOOHJDWLRQVXQGHU† DQG†nWKDW 3ULPD3DLQWWKLV&RXUWWKHQFKDUDFWHUL]HGWKHmFHQWUDOLVVXHl DQ\ ORDQ FRQWUDFW PDGH LQ YLRODWLRQ RI †   VKDOO EH DVmZKHWKHU&%6jFODLPRIIUDXGUHODWHVWRWKHPDNLQJRIWKH YRLGDQGWKDW'HIHQGDQWVZHUHQRWOLFHQVHGWRHQWHULQWRWKH DUELWUDWLRQDJUHHPHQW,ILWGRHVWKHFRXUWVKRXOGDGMXGLFDWH ORDQDJUHHPHQWVnDVDOOHJDWLRQVRIYRLGDELQLWLRFRQWUDFWV WKHIUDXGFODLP,ILWGRHVQRWWKHQWKH>)$$@UHTXLUHVWKDW XQGHUWKH7KUHH9DOOH\VOLQHRIFDVHV WKHIUDXGFODLPEHGHFLGHGE\DQDUELWUDWRUl,G &RQVLVWHQW ZLWK WKH QDWXUH RI IUDXG LQ WKH IDFWXP :HQRWHWKDWWKLV&RXUWLQ&%6(PSOR\HHVLQQRWZDQWLQJ DOOHJDWLRQVFRXUWVKDYHDGGUHVVHGTXHVWLRQVRIYRLGDELQLWLR WRFRQIRXQGWKHGLVSRVLWLYHTXHVWLRQPD\LQIDFWKDYHEHJJHG FRQWUDFWV DV TXHVWLRQV RI VLJQDWRU\ SRZHU QRW FRQWUDFW WKHGLVSRVLWLYHTXHVWLRQ7KDWLVLWLVQRWFOHDUWKDWFLWDWLRQWR FRQWHQW6HH$LUFUDIW%UDNLQJ6\V&RUSY/RFDO,QWjO 8QLRQ  )G   WK &LU    H[DPLQLQJ ZKHWKHU LQWHULP FRQWUDFW H[LVWHG GHVSLWH IDLOXUH WR UDWLI\ 6SKHUH'UDNH,QV)GDW   GHWHUPLQLQJZKHWKHU DQG QR FRQWUDFW DW DOOl 5HVWDWHPHQW 6HFRQG RI &RQWUDFWV †  FPW D VLJQDWRU\KDGSRZHUWRELQGFRPSDQ\ 6DQGYLN)GDW