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 DS

81,7('67$7(6&28572)$33($/6 )257+(6,;7+&,5&8,7 BBBBBBBBBBBBBBBBB

81,7(' )22' $1' ; &200(5&,$/ :25.(56  ,17(51$7,21$/ 81,21   1R /2&$/ HWDO  3ODLQWLIIV$SSHOODQWV !   Y   81,7(' )22' $1'  &200(5&,$/ :25.(56   ,17(51$7,21$/ 81,21HWDO  'HIHQGDQWV$SSHOOHHV  $SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW IRUWKH1RUWKHUQ'LVWULFWRI2KLRDW7ROHGR 1R n'DYLG$.DW]'LVWULFWsXGJH $UJXHG $SULO 'HFLGHGDQG)LOHG $XJXVW %HIRUH '$8*+75(<DQG0225(&LUFXLWsXGJHV 6,03621'LVWULFWsXGJH

7KH +RQRUDEOH &KDUOHV 5 6LPSVRQ ,,, 8QLWHG 6WDWHV 'LVWULFW sXGJH IRU WKH :HVWHUQ 'LVWULFW RI .HQWXFN\ VLWWLQJ E\ GHVLJQDWLRQ

  8QLWHG)RRGHWDOY8QLWHG)RRGHWDO 1R BBBBBBBBBBBBBBBBB &2816(/ $5*8('   7HG ,RULR .$/1,= ,25,2  )(/'67(,1 7ROHGR 2KLR IRU $SSHOODQWV  0HOYLQ 6 6FKZDU]ZDOG 6&+:$5=:$/'  0&1$,5 &OHYHODQG 2KLR IRU $SSHOOHHV21%5,() 7HG,RULR&KULVWLQH$5HDUGRQ 'RQDWR6,RULR.$/1,=,25,2 )(/'67(,17ROHGR 2KLR IRU $SSHOODQWV  0HOYLQ 6 6FKZDU]ZDOG (EHQ 2 0F1DLU ,9 sDPHV * 3RUFDUR 6&+:$5=:$/' 0&1$,5&OHYHODQG2KLRIRU$SSHOOHHV 0225(sGHOLYHUHGWKHRSLQLRQRIWKHFRXUWLQZKLFK '$8*+75(<sMRLQHG6,03621's S GHOLYHUHG DVHSDUDWHRSLQLRQFRQFXUULQJLQSDUWDQGGLVVHQWLQJLQSDUW BBBBBBBBBBBBBBBBB 23,1,21 BBBBBBBBBBBBBBBBB .$5(1 1(/621 0225( &LUFXLW sXGJH  7KLV FDVH LQYROYHVDGLVSXWHEHWZHHQDQLQWHUQDWLRQDOODERURUJDQL]DWLRQ DQGRQHRILWVDIILOLDWHV3ODLQWLIIV$SSHOODQWV8QLWHG)RRG DQG &RPPHUFLDO :RUNHUV m8)&:l  ,QWHUQDWLRQDO 8QLRQ /RFDO DQGLWVLQGLYLGXDOPHPEHUV m/RFDO l DSSHDO WKH GLVWULFW FRXUWjV GLVPLVVDO RI WKHLU FRPSODLQW DJDLQVW 'HIHQGDQWV$SSHOOHHV 8)&: ,QWHUQDWLRQDO 8QLRQ m,QWHUQDWLRQDO8QLRQl DQGLWVRIILFHUVIRUYLRODWLRQVRIWKH /DERU0DQDJHPHQW 5HODWLRQV $FW m/05$l    86& ††  DQG WKH /DERU0DQDJHPHQW 5HSRUWLQJ DQG 'LVFORVXUH$FWRI   m/05'$l  86&†† %HFDXVHUHOLHIFRXOGEHJUDQWHGRQWKH/05$FODLPDQGRQH RIWKH/05'$FODLPVZH$)),50LQSDUWDQG5(9(56( LQSDUWWKHGLVWULFWFRXUWjVGHFLVLRQDQG5(0$1'IRUIXUWKHU SURFHHGLQJVFRQVLVWHQWZLWKWKLVRSLQLRQ 1R 8QLWHG)RRGHWDOY8QLWHG)RRGHWDO  ,%$&.*5281' /RFDO DFKDUWHUHGDIILOLDWHRIWKH,QWHUQDWLRQDO8QLRQ UHSUHVHQWVDSSUR[LPDWHO\ZRUNHUVLQWKHPHDWSDFNLQJ IRRGSURFHVVLQJDQGUHWDLOLQGXVWULHVRIQRUWKZHVWHUQ2KLR 0HLMHU,QF m0HLMHUl LVD0LFKLJDQEDVHGUHWDLOFKDLQWKDW VHOOVJURFHULHVDQGJHQHUDOPHUFKDQGLVH6HSWHPEHU   PDUNHGWKHH[SLUDWLRQRI/RFDO jVFROOHFWLYHEDUJDLQLQJ DJUHHPHQWZLWK0HLMHUIRUIRXU0HLMHUVWRUHVLQWKH7ROHGR 2KLRDUHD7KHQHJRWLDWLRQVWKDWHQVXHGEHWZHHQ/RFDO  DQG0HLMHUUHVXOWHGLQDmODVWEHVWDQGILQDORIIHUlE\0HLMHU ZKLFK/RFDO UHMHFWHGE\DPDUJLQRIQLQHWRRQHsRLQW $SSHQGL[ ms$l DW   )LUVW$P&RPSO m)$&l DW ˆˆ    /RFDO jV VXEVHTXHQW DWWHPSW WR ER\FRWW 0HLMHUjV 7ROHGR VWRUHV ZDV RYHUUXOHG E\ WKH ,QWHUQDWLRQDO 8QLRQ  %\ 'HFHPEHU    KRZHYHU /RFDO  DQG 0HLMHU PDQDJHG WR UHDFK DQG UDWLI\ D VXFFHVVRU FROOHFWLYH EDUJDLQLQJDJUHHPHQWZKLFKmFRQWDLQHGLPSURYHPHQWVRYHU DQGDERYH>0HLMHUjVSUHYLRXVRIIHUV@ls$DW  )$&DW ˆ  $W DERXW WKLV WLPH 0HLMHU ZDV EXLOGLQJ D QHZ VWRUH LQ %RZOLQJ*UHHQ2KLR2Q)HEUXDU\ 'DYLG:*HOLRV m*HOLRVl WKHSUHVLGHQWDQGFKLHIH[HFXWLYHRIILFHURI/RFDO ZURWHWR'RXJODV+'RULW\ m'RULW\l WKHSUHVLGHQWRI WKH ,QWHUQDWLRQDO 8QLRQ DERXW /RFDO jV IXWXUH UHSUHVHQWDWLRQ RI XQLRQ PHPEHUV DW WKH QHZ 0HLMHU VWRUH QRWLQJ WKH VWRUHjV ORFDWLRQ mLQ WKH PLGGOH RI /RFDO jV MXULVGLFWLRQls$DW 'RULW\GHFLGHGWRDVVLJQWKHVWRUH WRWKHMXULVGLFWLRQRI/RFDO ZKLFKFRYHUVFHQWUDODQG VRXWKHDVWHUQ2KLR/RFDO LPPHGLDWHO\DSSHDOHG'RULW\jV GHFLVLRQXQGHUWKH8)&:,QWHUQDWLRQDO8QLRQ&RQVWLWXWLRQ m8)&: &RQVWLWXWLRQl   $IWHU D KHDULQJ WKH 8)&: ,QWHUQDWLRQDO([HFXWLYH%RDUGGHQLHGWKHDSSHDO 2Q1RYHPEHU  /RFDO ILOHGDFRPSODLQWLQWKH GLVWULFW FRXUW DOOHJLQJ WKDW WKH ,QWHUQDWLRQDO 8QLRQ KDG  GHQLHGLWGXHSURFHVVLQYLRODWLRQRI† D  RIWKH /05'$  DEULGJHGLWVIUHHVSHHFKDQGDVVHPEO\ULJKWVLQ YLRODWLRQRI† D  RIWKH/05'$DQG  EUHDFKHGWKH  8QLWHG)RRGHWDOY8QLWHG)RRGHWDO 1R 1R 8QLWHG)RRGHWDOY8QLWHG)RRGHWDO  8)&:&RQVWLWXWLRQLQYLRODWLRQRI†RIWKH/05$2Q BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB 0DUFKZLWKWKHOHDYHRIWKHGLVWULFWFRXUW/RFDO  ILOHGDILUVWDPHQGHGFRPSODLQWDOOHJLQJLQDGGLWLRQWRWKH &21&855,1*,13$57',66(17,1*,13$57 FODLPVUDLVHGLQLWVRULJLQDOFRPSODLQWWKDWWKH,QWHUQDWLRQDO BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB 8QLRQ KDG EUHDFKHG LWV ILGXFLDU\ GXW\ WR /RFDO  LQ YLRODWLRQRI†RIWKH/05'$/RFDO VRXJKWYDULRXV 6,03621'LVWULFWsXGJHFRQFXUULQJLQSDUWDQGGLVVHQWLQJ GHFODUDWRU\ MXGJPHQWV D SUHOLPLQDU\ DQG SHUPDQHQW LQSDUW,FRQFXUZLWKWKHPDMRULW\RSLQLRQH[FHSWIRU6HFWLRQ LQMXQFWLRQUHVWRUDWLRQRIMXULVGLFWLRQRYHUWKH0HLMHUVWRUHLQ ,,$IURPZKLFK,UHVSHFWIXOO\GLVVHQW,Q&RUHDY:HOR %RZOLQJ *UHHQ YDULRXV GDPDJHV LQ H[FHVV RI RQH PLOOLRQ )G WK&LU  ZHGHWHUPLQHGWKDW GROODUVDQGFRVWV 7KHSULPDU\SXUSRVHRI 86&† D LVWRHQVXUH 2Q0DUFKWKH,QWHUQDWLRQDO8QLRQILOHGDPRWLRQ WKDWXQLRQRIILFLDOVGRQRWYLRODWHWKHLUILGXFLDU\GXWLHVWR WR GLVPLVV /RFDO jV FRPSODLQW IRU LPSURSHU YHQXH DQG WKHPHPEHUVRIWKHLURUJDQL]DWLRQE\HQJDJLQJLQVHOI IDLOXUHWRVWDWHDFODLPXSRQZKLFKUHOLHIFRXOGEHJUDQWHG GHDOLQJRUWKHPLVXVHRIXQLRQIXQGVZKLFKWKH\KROGLQ 2Q 2FWREHU   WKH GLVWULFW FRXUW JUDQWHG WKH WUXVW+RZHYHUWKHVWDWXWHLVQRWPHDQWDVDYHKLFOHIRU ,QWHUQDWLRQDO 8QLRQjV PRWLRQ RQ WKH ODWWHU JURXQG 8QLWHG MXGLFLDORYHUVLJKWRIXQLRQDFWLYLW\EXWRQO\DVDPHDQV )RRG &RPPHUFLDO:RUNHUV8QLRQ/RFDO1R Y8QLWHG RIUHGUHVVLQJXQUHDVRQDEOHDQGDUELWUDU\DFWLRQVE\XQLRQ )RRG &RPPHUFLDO:RUNHUV,QWjO8QLRQ )6XSSG RIILFLDOV  7KH IHGHUDO FRXUWV GR QRW VLW DV D mVXSHU     1' 2KLR    7KLV WLPHO\ DSSHDO UHYLHZlERDUGRILQWHUQDOXQLRQJULHYDQFHVXQOHVVWKHUH IROORZHG LVHYLGHQFHRILPSURSULHW\LQWKHSURFHHGLQJV ,,$1$/<6,6 ,QHVVHQFHWKLVDFWLRQFRQVWLWXWHVDGLVSXWHEHWZHHQ/RFDO  DQG LWV QDWLRQDO RUJDQL]DWLRQ RYHU D MXULVGLFWLRQDO :HUHYLHZGHQRYRDGLVWULFWFRXUWjVGLVPLVVDORIDFODLP DVVLJQPHQW QDPHO\ WKH ULJKW WR UHSUHVHQW HPSOR\HHV DW D SXUVXDQWWR)HGHUDO5XOHRI&LYLO3URFHGXUH E  ,QJHY 0HLMHUVWRUHLQ%RZOLQJ*UHHQ2KLR7KHORVVRIULJKWVWKH 5RFN)LQ&RUS)G  WK&LU ,QGRLQJ ORFDOXQLRQIDFHVLVWKXVHFRQRPLFUDWKHUWKDQWKHmLQYDOXDEOH VR ZH mDFFHSW DOO ZHOOSOHDGHG IDFWXDO DOOHJDWLRQV RI WKH DQGLUUHSDUDEOHORVVRIGHPRFUDWLFULJKWVlWKLV&LUFXLWUHTXLUHV FRPSODLQWDVWUXHDQGFRQVWUXHWKHFRPSODLQWLQWKHOLJKWPRVW IRUD†DFWLRQ&RUHD )GDW FLWLQJ:DGHY IDYRUDEOHWRWKHSODLQWLIIl,G+RZHYHUZHmQHHGQRWDFFHSW 7HDPVWHUV/RFDO)6XSS  ('0LFK DVWUXHOHJDOFRQFOXVLRQVRUXQZDUUDQWHGIDFWXDOLQIHUHQFHVl     7KH PDMRULW\jV UHYHUVDO RI WKH †  FODLP ZLOO 0LFK3D\WHOsRLQW9HQWXUHY&LW\RI'HWURLW)G UHTXLUHWKHGLVWULFWFRXUWWRVLWDVDmVXSHUUHYLHZERDUGlWR  WK&LU  TXRWDWLRQRPLWWHG :HZLOODIILUPD GHWHUPLQH ZKHWKHU /RFDO  VKRXOG KDYH EHHQ JUDQWHG GLVPLVVDOmRQO\LILWLVFOHDUWKDWQRUHOLHIFRXOGEHJUDQWHG MXULVGLFWLRQ RYHU WKH 0HLMHU VWRUH  6XFK DQ H[HUFLVH LV XQGHUDQ\VHWRIIDFWVWKDWFRXOGEHSURYHGFRQVLVWHQWZLWKWKH XQQHFHVVDU\ JLYHQ WKH DGPLWWHGO\ XQOLNHO\ LQIHUHQFHV WKH DOOHJDWLRQVl,QJH)GDW  TXRWLQJ+LVKRQY.LQJ PDMRULW\RSLQLRQUHTXLUHVDQGPRUHLPSRUWDQWO\LVFRQWUDU\ 6SDXOGLQJ86     WR6L[WK&LUFXLWSUHFHGHQW)RUWKHVHUHDVRQV,ZRXOGDIILUP WKHGLVWULFWFRXUWjVGLVPLVVDORIWKH†FODLP  8QLWHG)RRGHWDOY8QLWHG)RRGHWDO 1R 1R 8QLWHG)RRGHWDOY8QLWHG)RRGHWDO  MXULVGLFWLRQnLQWKHHYHQWWKDWDORFDODIILOLDWHIDLOVWRREWDLQ $7KH/05'$&ODLPV DXWKRUL]DWLRQ EHIRUH HQJDJLQJ LQ HFRQRPLF DFWLRQ  7KLV DUJXPHQWPD\UHDGWRRPXFKLQWR$UWLFOH,QDQ\HYHQW ,Q )LQQHJDQ Y /HX  86     WKH 6XSUHPH /RFDO jV $UWLFOH  FODLP UHVWV RQ WKH SUHPLVH WKDW WKH &RXUW REVHUYHG WKDW WKH /05'$ mZDV WKH SURGXFW RI GHQLDO RI MXULVGLFWLRQ FRQVWLWXWHG D mSHQDOW\l  s$ DW  FRQJUHVVLRQDOFRQFHUQZLWKZLGHVSUHDGDEXVHVRISRZHUE\ )$&DWˆ *LYHQRXUKROGLQJLQ3DUW,,$WKDW'RULW\jV XQLRQOHDGHUVKLSl,GDW&RQJUHVVXOWLPDWHO\DGRSWHG MXULVGLFWLRQDO GHFLVLRQ ZDV QRW GLVFLSOLQDU\ LQ QDWXUH WKH DPHQGPHQWV WR WKH /05'$ WKDW ZHUH mDLPHG DW HQODUJHG $UWLFOHFODLPLVQRWYLDEOH SURWHFWLRQIRUPHPEHUVRIXQLRQVSDUDOOHOLQJFHUWDLQULJKWV JXDUDQWHHGE\WKH)HGHUDO&RQVWLWXWLRQl )LQDOO\ /RFDO  FODLPV WKDW WKH ,QWHUQDWLRQDO 8QLRQ YLRODWHG$UWLFOH $ ZKLFKVWDWHVWKDWm>W@KH,QWHUQDWLRQDO 7KHDPHQGPHQWVSODFHGHPSKDVLVRQWKHULJKWVRIXQLRQ 3UHVLGHQW LQ FRQVXOWDWLRQ ZLWK WKH ,QWHUQDWLRQDO 6HFUHWDU\ PHPEHUV WR IUHHGRP RI H[SUHVVLRQ ZLWKRXW IHDU RI 7UHDVXUHUVKDOOGHWHUPLQHWKHMXULVGLFWLRQRI/RFDO8QLRQV VDQFWLRQVE\WKHXQLRQZKLFKLQPDQ\LQVWDQFHVFRXOG DQGPD\PRGLI\WKHMXULVGLFWLRQRI/RFDO8QLRQVIURPWLPHWR PHDQ ORVV RI XQLRQ PHPEHUVKLS DQG LQ WXUQ ORVV RI WLPH VXEMHFW WR DQ DSSHDO WR WKH ,QWHUQDWLRQDO ([HFXWLYH OLYHOLKRRG6XFKSURWHFWLRQZDVQHFHVVDU\WRIXUWKHUWKH %RDUGl s$DW7KHSDUWLHVPDLQO\IRFXVDVGLGWKH >/05'$@jVSULPDU\REMHFWLYHRIHQVXULQJWKDWXQLRQV GLVWULFWFRXUWRQWKHH[WHQWRI'RULW\jVGLVFUHWLRQ+RZHYHU ZRXOGEHGHPRFUDWLFDOO\JRYHUQHGDQGUHVSRQVLYHWRWKH WKLV IRFXV PLVVHV WKH IDFW WKDW $UWLFOH  $  UHTXLUHV WKH ZLOORIWKHLUPHPEHUVKLSV ,QWHUQDWLRQDO 3UHVLGHQW DW OHDVW WR FRQVXOW WKH ,QWHUQDWLRQDO 6HFUHWDU\7UHDVXUHU ZKHQ PDNLQJ MXULVGLFWLRQDO ,G DW   7KH VFRSH RI WKH /05'$jV SURWHFWLRQ GHWHUPLQDWLRQV$YLDEOHEUHDFKRIFRQWUDFWFODLPFRXOGWKXV KRZHYHUGRHVQRWH[WHQGDVIDUDVWKDWRIWKH&RQVWLWXWLRQ DULVHIURPDIDLOXUHWRFRQVXOW7KH)$&H[SOLFLWO\DOOHJHV 8QLWHG6WHHOZRUNHUVRI$PY6DGORZVNL86 WKDW'RULW\PDGHKLVGHFLVLRQZLWKRXWFRQVXOWLQJsRVHSK7   )RUH[DPSOHXQLRQUXOHVPXVWRQO\EHmUHDVRQDEOHl +DQVHQ m+DQVHQl  WKH ,QWHUQDWLRQDO 6HFUHWDU\7UHDVXUHU WREHYDOLGXQGHU† D  ZKLFKJXDUDQWHHVIUHHVSHHFK s$DW )$&DWˆ 'RULW\FODLPVWKDWKHGLGFRQVXOW DQGDVVHPEO\ULJKWVWRXQLRQPHPEHUVZKHUHDVJRYHUQPHQWDO +DQVHQDQGIXUWKHUGLVFRYHU\FRXOGSHUKDSVHVWDEOLVKWKDWKH UHJXODWLRQVPXVWIXUWKHUDFRPSHOOLQJJRYHUQPHQWDOLQWHUHVW LVWHOOLQJWKHWUXWK+RZHYHUDWWKLVVWDJHRIWKHSURFHHGLQJV DQG EH QDUURZO\ WDLORUHG WR EH YDOLG XQGHU WKH )LUVW ZHPXVWDFFHSW/RFDO jVDOOHJDWLRQDVWUXHDQGUHYHUVHWKH $PHQGPHQW,GDW GLVWULFWFRXUWj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† D  ,Q%UHLQLQJHUY6KHHW0HWDO:RUNHUV DW   7KH ,QWHUQDWLRQDO 8QLRQ KRZHYHU HPSKDVL]HV WKH ,QWjO $VVjQ /RFDO 8QLRQ 1R    86     WKH QHJDWLYH LPSOLFDWLRQV RI D FRQWUDU\ GHFLVLRQ SRLQWLQJ RXW 6XSUHPH&RXUWVWDWHGmWKDWE\XVLQJWKHSKUDVHµRWKHUZLVH 'RULW\jVFRQFHUQWKDWmUHSUHVHQWDWLRQE\DQ\8)&:DIILOLDWH GLVFLSOLQHj&RQJUHVVGLGQRWLQWHQGWRLQFOXGHDOODFWVWKDW >RWKHUWKDQ/RFDO @ZRXOGEHKLJKO\XQOLNHO\lDQGEHOLHI GHWHUUHGWKHH[HUFLVHRIULJKWVSURWHFWHGXQGHUWKH/05'$ WKDW mZRUNLQJ FRQGLWLRQV ZRXOG EH EHWWHU ZLWK /RFDO  EXW UDWKHU PHDQW LQVWHDG WR GHQRWH RQO\ SXQLVKPHQW WKDQZLWKQRXQLRQDWDOOl$SSHOOHHVj%UDW,QRWKHU DXWKRUL]HGE\WKHXQLRQDVDFROOHFWLYHHQWLW\WRHQIRUFHLWV ZRUGV WKH ,QWHUQDWLRQDO 8QLRQ EHOLHYHV WKDW DVVLJQLQJ WKH UXOHVl  ,G DW   ,Q RWKHU ZRUGV D XQLRQ PHPEHU LV %RZOLQJ*UHHQVWRUHWR/RFDO jVMXULVGLFWLRQIXUWKHUHG mGLVFLSOLQHGlRQO\ZKHQWKHXQLRQWDNHVDFWLRQmXQGHUFRORU ERWKWKHREMHFWLYHVRIRUJDQL]LQJWKHIXWXUHHPSOR\HHVDWWKDW RIWKHXQLRQjVULJKWWRFRQWUROWKHPHPEHUjVFRQGXFWLQRUGHU VWRUH DQG REWDLQLQJ WKH VWDWXV RI H[FOXVLYH EDUJDLQLQJ WRSURWHFWWKHLQWHUHVWVRIWKHXQLRQRULWVPHPEHUVKLSl,G UHSUHVHQWDWLYH TXRWDWLRQRPLWWHG  :HUHLWHUDWHWKDW/RFDO jV†FODLPLVRQHIRUEUHDFK /RFDO FRQWHQGVWKDWLWVPHPEHUVZHUHGLVFLSOLQHGLQ RIFRQWUDFW$VVXFKLWLQYROYHVWKH,QWHUQDWLRQDO8QLRQDQG YLRODWLRQRIWKH/05'$ZKHQ 'RULW\DVVLJQHGWKH0HLMHU /RFDO  DV SDUWLHV WR WKH 8)&: &RQVWLWXWLRQ  7KH VWRUH DW %RZOLQJ *UHHQ WR WKH MXULVGLFWLRQ RI /RFDO  ,QWHUQDWLRQDO 8QLRQ DSSHDUV WR PDLQWDLQ WKDW DVVLJQLQJ WKH UDWKHUWKDQ/RFDO 7KLVGHFLVLRQZDVDOOHJHGO\PDGHmLQ %RZOLQJ*UHHQVWRUHWR/RFDO jVMXULVGLFWLRQZRXOGKDYH DFDOFXODWHGDWWHPSWWRUHWDOLDWHDJDLQVW>/RFDO @IRU>LWV@ FRQVWLWXWHGDQHYHQJUHDWHUEUHDFKRILWVGXW\WRSURVSHFWLYH DJJUHVVLYHSRVWXUHlGXULQJWKHQHJRWLDWLRQVZLWK0HLMHURYHU PHPEHUVDWWKHQHZVWRUH7KLVGXW\KRZHYHUPD\DOVRKDYH WKH FROOHFWLYH EDUJDLQLQJ DJUHHPHQW IRU WKH 7ROHGR VWRUHV EHHQ SURVSHFWLYH  $OWKRXJK WKH 3UHDPEOH WR WKH 8)&: s$ DW   :H FRQVLGHU /RFDO jV FKRLFH RI ZRUGV &RQVWLWXWLRQVSHDNVLQWHUPVRIHOHYDWLQJZRUNHUV$UWLFOH VRPHZKDWFXULRXVJLYHQWKH%UHLQLQJHU&RXUWjVGHWHUPLQDWLRQ VWDWHVWKDWm>W@KHREMHFWRIWKLV,QWHUQDWLRQDO8QLRQVKDOOEHWKH WKDW WKH /05'$jV mVSHFLILFDOO\ HQXPHUDWHG W\SHV RI HOHYDWLRQRIWKHSRVLWLRQRILWVPHPEHUVls$DW:H GLVFLSOLQHnILQHH[SXOVLRQDQGVXVSHQVLRQnLPSO\VRPH WDNH/RFDO jVSRVLWLRQWREHWKDWWKH,QWHUQDWLRQDO8QLRQ VRUW RI HVWDEOLVKHG GLVFLSOLQDU\ SURFHVV UDWKHU WKDQ DG KRF YLRODWHG $UWLFOH  E\ KDUPLQJ WKH SRVLWLRQ RI LWV FXUUHQW UHWDOLDWLRQ E\ LQGLYLGXDO XQLRQ RIILFHUVl  %UHLQLQJHU   PHPEHUVZKROO\DSDUWIURPKRZDGLIIHUHQWGHFLVLRQPLJKW 86DW  ,QDIRRWQRWHWKH&RXUWFODULILHGWKDWLWmG>LG@ KDYH KDUPHG WKH SRVLWLRQ RI LWV SURVSHFWLYH PHPEHUV QRWLPSO\WKDWµGLVFLSOLQHjPD\EHGHILQHGVROHO\E\WKHW\SH %HFDXVH UHOLHI FRXOG EH JUDQWHG LI /RFDO  SURYHV WKLV RI SXQLVKPHQW LQYROYHG RU WKDW D XQLRQ PLJKW EH DEOH WR EUHDFK RI FRQWUDFW ZH EHOLHYH WKDW WKH †  FODLP IRU D FLUFXPYHQW†† D  DQG E\GHYHORSLQJQRYHOIRUPV YLRODWLRQRI$UWLFOHLVYLDEOH RISHQDOWLHVGLIIHUHQWIURPILQHVVXVSHQVLRQVRUH[SXOVLRQVl ,GDW Q+RZHYHUmQRYHOlWKHGHQLDORIMXULVGLFWLRQ $UWLFOH  GHVFULEHV WKH SURFHGXUHV IRU DFFHSWLQJ RU PLJKWEHDVDIRUPRISXQLVKPHQWLWVHHPVDWOHDVWLQRXU UHMHFWLQJ FROOHFWLYH EDUJDLQLQJ FRQWUDFWV DQG HQJDJLQJ LQ YLHZ WR EH PXFK FORVHU WR DG KRF UHWDOLDWLRQ WKDQ WR VWULNHVRURWKHUHFRQRPLFDFWLRQZKLFKPXVWEHDXWKRUL]HGLQ mSXQLVKPHQWDXWKRUL]HGE\WKHXQLRQDVDFROOHFWLYHHQWLW\WR DGYDQFH E\ WKH ,QWHUQDWLRQDO ([HFXWLYH &RPPLWWHH  $UW HQIRUFH LWV UXOHVl  ,G DW   :H WKHUHIRUH KROG WKDW WKH  (  ,WIXUWKHUSURYLGHVWKDWWKH,QWHUQDWLRQDO8QLRQZLOO GLVWULFWFRXUWGLGQRWHUULQGLVPLVVLQJWKLVFODLP QRWGLVWULEXWHVWULNHRUGHIHQVHEHQHILWVXQOHVVORFDOXQLRQV REWDLQSULRUDXWKRUL]DWLRQ$UW )  /RFDO DUJXHV $QRWKHUGLIILFXOW\ZLWK /RFDO jV† D  FODLPLV LQWKHQHJDWLYHWKDW$UWLFOHDOORZVWKH,QWHUQDWLRQDO8QLRQ WKDWWKHDOOHJHGSXQLVKPHQWGLGQRWUHVXOWIURPDQHVWDEOLVKHG RQO\WRUHIXVHVWULNHRUGHIHQVHEHQHILWVnEXWQRWWRGHQ\  8QLWHG)RRGHWDOY8QLWHG)RRGHWDO 1R 1R 8QLWHG)RRGHWDOY8QLWHG)RRGHWDO  m&RXUWVDUHUHOXFWDQWWRVXEVWLWXWHWKHLUMXGJPHQWIRUWKDWRI XQLRQ GLVFLSOLQDU\ SURFHVV  &I .RQHQ Y ,QWjO %KG RI XQLRQ RIILFLDOV LQ WKH LQWHUSUHWDWLRQ RI WKH XQLRQjV 7HDPVWHUV /RFDO   )G   WK &LU  FRQVWLWXWLRQ DQG ZLOO LQWHUIHUH RQO\ ZKHUH WKH RIILFLDOjV KROGLQJWKDWWKHSODLQWLIIZDVQRWGLVFLSOLQHGLQYLRODWLRQRI LQWHUSUHWDWLRQ LV QRW IDLU RU UHDVRQDEOHl  8QLWHG %KG RI WKH /05'$ EHFDXVH KH mZDV QHYHU VXEMHFWHG WR RIILFLDO &DUSHQWHUV  sRLQHUV RI $P 'UHVGHQ /RFDO 1R  Y 8QLRQ GLVFLSOLQH    DQG WKHUH LV QR HYLGHQFH WKDW KLV 8QLWHG%KGRI&DUSHQWHUV sRLQHUVRI$P6&HQW2KLR PHPEHUVKLS ULJKWV RU VWDWXV KDYH EHHQ GLPLQLVKHG LQ DQ\ 'LVW&RXQFLO )G WK&LU   TXRWDWLRQ ZD\l   $OWKRXJK 'RULW\ FKDUJHG /RFDO  ZLWK YDULRXV RPLWWHG   7KHUHIRUH ZH SD\ mVXEVWDQWLDO GHIHUHQFHl WR D YLRODWLRQVRIWKH8)&:&RQVWLWXWLRQKHGLGQRWXQGHUWDNH XQLRQjVLQWHUSUHWDWLRQRILWVRZQFRQVWLWXWLRQ,G+RZHYHU DQ\IRUPDOGLVFLSOLQDU\DFWLRQDJDLQVWLQGLYLGXDOPHPEHUV LQFDVHVLQYROYLQJXQFRQVFLRQDEOHFRQGXFWZHKDYHVWDWHG )RUH[DPSOHLQDQ2FWREHU OHWWHUWR*HOLRV'RULW\ WKDWmEDGIDLWKZRXOGVWULSDZD\WKHSURWHFWLRQIURPMXGLFLDO VLPSO\GLUHFWHG/RFDO WRFHDVHDQXQDXWKRUL]HGER\FRWWRI LQWHUIHUHQFHWRZKLFKWKHXQLRQZRXOGEHHQWLWOHGRWKHUZLVHl WKH 0HLMHU VWRUHV LQ 7ROHGR  +H GLG QRW ILQH VXVSHQG RU 8$:/RFDO Y,QWjO8QLRQ8$: )G H[SHODQ\PHPEHURI/RFDO 7KHUHIRUHZHDIILUPWKH WK&LU   GLVWULFWFRXUWjVGLVPLVVDORIWKH† D  FODLP 2EVHUYLQJWKDW'RULW\DVmWKH,QWHUQDWLRQDOSUHVLGHQWKDG 6HFWLRQ D  DPSOH GLVFUHWLRQ >XQGHU $UWLFOH  $  RI WKH 8)&: &RQVWLWXWLRQ@LQWKHDVVLJQPHQWRIMXULVGLFWLRQlWKHGLVWULFW 6HFWLRQ  D   RI WKH /05'$ JXDUDQWHHV WR XQLRQ FRXUWGLVPLVVHG/RFDO jV†FODLPRQWKHJURXQGWKDW PHPEHUVmWKHULJKWWRPHHWDQGDVVHPEOHIUHHO\ZLWKRWKHU 'RULW\jV GHFLVLRQ mZDV ZHOO ZLWKLQ WKH ERXQGV RI PHPEHUV DQGWRH[SUHVVDQ\YLHZVDUJXPHQWVRURSLQLRQVl UHDVRQDEOHQHVVDQGQRWEDVHGRQEDGIDLWKl8QLWHG)RRG  86&† D  $VQRWHGDERYHWKHVWDWXWHSURYLGHV  )6XSSGDW7KHGLVWULFWFRXUWGLGQRWRWKHUZLVH WKDWWKHH[HUFLVHRIWKLVULJKWPD\EHJRYHUQHGE\XQLRQUXOHV GLVFXVV WKH SDUWLHVj YDU\LQJ LQWHUSUHWDWLRQV RI WKH 8)&: WKDW DUH mUHDVRQDEOHl  ,G  /RFDO  DVVHUWV WKDW WKH &RQVWLWXWLRQ ,QWHUQDWLRQDO8QLRQYLRODWHGmWKHµDOPRVWDEVROXWHjULJKWRI IUHHVSHHFKVHFXUHGE\† D  l$SSHOODQWVj%UDWE\ /RFDO jV†FODLPLVEDVHGRQDOOHJHGYLRODWLRQVRI   SODFLQJ XQUHDVRQDEOH UHVWULFWLRQV RQ ER\FRWWLQJ DQG $UWLFOHVDQGRIWKH8)&:&RQVWLWXWLRQDVZHOODV SLFNHWLQJWKH7ROHGRVWRUHVDQG  UHWDOLDWLQJDJDLQVW/RFDO WKH3UHDPEOHZKLFKGHFODUHVWKDWWKH,QWHUQDWLRQDO8QLRQZDV  WKURXJK D mSXQLWLYH UHPRYDO RI MXULVGLFWLRQl RYHU WKH mFUHDWHGLQRUGHUWRHOHYDWHWKHVRFLDODQGHFRQRPLFVWDWXVRI %RZOLQJ *UHHQ VWRUH ZKLFK mDEULGJHG DQG FDVW D FKLOOLQJ ZRUNHUVl  s$ DW   $UWLFOH  LQFOXGHV WKH IROORZLQJ HIIHFW XSRQ WKH IUHH VSHHFK DQG DVVHPEO\ ULJKWV RI DOO DPRQJWKH,QWHUQDWLRQDO8QLRQjVREMHFWLYHV   mWRRUJDQL]H LQGLYLGXDO /RFDO  PHPEHUVl  s$ DW   )$& DW XQLWHDQGDVVLVW SHUVRQVIRUWKHSXUSRVHRILPSURYLQJ ˆˆ  ZDJHV KRXUV EHQHILWV DQG ZRUNLQJ FRQGLWLRQV RQ ORFDO QDWLRQDORULQWHUQDWLRQDOOHYHOVlDQG  mWRREWDLQWKHVWDWXV :HEHOLHYHWKDW/RFDO jV† D  FODLPUHVWVRQD RIH[FOXVLYHEDUJDLQLQJUHSUHVHQWDWLYHRISHUVRQVHPSOR\HG PLVXQGHUVWDQGLQJRIWKHULJKWVJXDUDQWHHGE\WKH/05'$ ZLWKLQWKHMXULVGLFWLRQRIWKH,QWHUQDWLRQDO8QLRQls$DW $IWHU VWDWLQJ WKDW m)LUVW $PHQGPHQW SULQFLSOHV PD\ EH /RFDO DUJXHVWKDWWKHIRUPHUREMHFWLYHZDVKLQGHUHG KHOSIXOlEXWmQRWFRQWUROOLQJlWKH6DGORZVNL&RXUWGLVFXVVHG E\ m'RULW\jV GHQLDO RI MXULVGLFWLRQ WR /RFDO l ZKLFK &RQJUHVVjVLQWHQWLQHQDFWLQJ† D  mUHZDUG>HG@0HLMHUZLWKOHYHUDJHWREHXVHGDJDLQVW /RFDO jV PHPEHUV DW WKH EDUJDLQLQJ WDEOHl  $SSHOODQWVj %U &RQJUHVVDGRSWHGWKHIUHHGRPRIVSHHFKDQGDVVHPEO\ SURYLVLRQ LQ RUGHU WR SURPRWH XQLRQ GHPRFUDF\  ,W  8QLWHG)RRGHWDOY8QLWHG)RRGHWDO 1R 1R 8QLWHG)RRGHWDOY8QLWHG)RRGHWDO  UHFRJQL]HG WKDW GHPRFUDF\ ZRXOG EH DVVXUHG RQO\ LI $VIRU'RULW\jVVHQGLQJDFRS\RIWKH2FWREHUOHWWHUWR XQLRQ PHPEHUV DUH IUHH WR GLVFXVV XQLRQ SROLFLHV DQG 0HLMHUZHFRQFOXGHWKDWWKLVH[FKDQJHFRXOGQRWKDYHFDXVHG FULWLFL]HWKHOHDGHUVKLSZLWKRXWIHDURIUHSULVDO&RQJUHVV DQ\ ORVV RI /RFDO jV GHPRFUDWLF ULJKWV  ,Q :DGH WKH DOVRUHFRJQL]HGWKDWWKLVIUHHGRPLVSDUWLFXODUO\FULWLFDO IDLOXUH RI XQLRQ RIILFLDOV WR KROG PRQWKO\ PHPEHUVKLS DQG GHVHUYHV YLJRURXV SURWHFWLRQ LQ WKH FRQWH[W RI PHHWLQJVZDVIRXQGDFWLRQDEOHXQGHU†:DGH) HOHFWLRQFDPSDLJQV 6XSSDW,QWKLVFDVHWKHOHWWHUVLPSO\GLUHFWHG/RFDO  QRW WR WDNH HFRQRPLF DFWLRQ ZLWKRXW REWDLQLQJ SULRU 6DGORZVNL  86 DW  LQWHUQDO FLWDWLRQV RPLWWHG  DXWKRUL]DWLRQ,WGLGQRWSURKLELWRUSUHYHQW/RFDO IURP :HKDYHVXEVHTXHQWO\XQGHUVWRRG† D  LQWKHVHPRUH H[HUFLVLQJ LWV GHPRFUDWLF ULJKWV WR VHHN WKH QHFHVVDU\ OLPLWHGWHUPV6HH&RUHDY:HOR )G WK DXWKRUL]DWLRQLQWKHIXWXUH$WPRVWLWLQIRUPHG0HLMHUWKDW &LU   m6HFWLRQ D  RI>WKH@/05'$JXDUDQWHHV WKH,QWHUQDWLRQDO8QLRQZRXOGVXSSRUWRQO\WKRVHDFWLRQVRI WKDWXQLRQPHPEHUVKDYHWKHULJKWWRDVVHPEOHIUHHO\ZLWK /RFDO WKDWZHUHDXWKRUL]HGZKLFKLVHQWLUHO\LQNHHSLQJ RWKHU PHPEHUV DQG WR H[SUHVV WKHLU YLHZV RQ EXVLQHVV ZLWK WKH ,QWHUQDWLRQDO 8QLRQjV VWDWXV DV D JRYHUQLQJ ERG\ SURSHUO\EHIRUHDPHHWLQJRIWKHXQLRQPHPEHUVKLSl 7XFNHU 7KHUHIRUH ZH DIILUP WKH GLVWULFW FRXUWjV GLVPLVVDO RI WKH Y %LHEHU  )G   WK &LU  m7LWOH , >RI WKH EUHDFKRIILGXFLDU\GXW\FODLPDVLWUHODWHVWRWKH2FWREHU /05'$@SURWHFWVUDQNDQGILOHXQLRQPHPEHUVZKRVSHDN OHWWHU RXW DJDLQVW XQLRQ OHDGHUV RU ZKR VHHN HOHFWLYH XQLRQ RIILFHVl FHUWGHQLHG 86    )RUH[DPSOH %7KH/05$&ODLP LQ%ODFNY5\GHU3,(1DWLRQZLGH,QF )G WK &LU  DPHPEHURI7HDPVWHUV/RFDO ZKRKDGEHHQ 8QGHU†RIWKH/05$ODERURUJDQL]DWLRQVPD\VXH GLVFLSOLQHGIRUSURWHVWLQJDJDLQVWWKHFRUUXSWLRQRIORFDOXQLRQ HDFKRWKHULQIHGHUDOFRXUWIRUEUHDFKRIFRQWUDFW 86& RIILFLDOVZDVDEOHWREULQJDVXFFHVVIXOUHWDOLDWLRQFODLPXQGHU †7KH8)&:&RQVWLWXWLRQLVDFRQWUDFWEHWZHHQ/RFDO WKH/05'$,GDW  DQGWKH,QWHUQDWLRQDO8QLRQ6HH:RRGGHOOY,QWjO%KG RI(OHF:RUNHUV/RFDO86     /RFDO 7KHIDFWVRIWKLVFDVHDVDOOHJHGE\/RFDO VLPSO\GRQRW DOOHJHVWKDW'RULW\DQGWKH,QWHUQDWLRQDO8QLRQYLRODWHG LPSOLFDWHXQLRQGHPRFUDF\7KHmUHVWULFWLRQVlRQER\FRWWLQJ WKH 8)&: &RQVWLWXWLRQ E\ DVVLJQLQJ WKH 0HLMHU VWRUH LQ DQGSLFNHWLQJUHVXOWHGIURP/RFDO jVIDLOXUHWRREWDLQSULRU %RZOLQJ*UHHQWRWKHMXULVGLFWLRQRI/RFDO UDWKHUWKDQ DXWKRUL]DWLRQDVUHTXLUHGE\WKH8)&:&RQVWLWXWLRQ/RFDO /RFDO  ZKLFK mFDUY>HG@ MXULVGLFWLRQ WR IDYRU DQ HPSOR\HUl$SSHOODQWVj%UDW  /RFDO  KHDYLO\ UHOLHV RQ 7XUQHU Y $LU 7UDQVSRUW /RGJH   RI ,QWjO $VVjQ RI 0DFKLQLVWV DQG $HURVSDFH :RUNHUV   )G  G &LU   SHU FXULDP  FHUW GHQLHG  86     ZKLFK VWDWHG WKDW mWK>H@ IUHH VSHHFK ULJKW RI >XQLRQ@ PHPEHUV LV DOPRVW DEVROXWHl ZKLOH :H HPSKDVL]H WKDW ZH PXVW DFFHSW /RFDO jV DOOHJDWLRQV DV WUXH DW WKLV UHFRJQL]LQJ WKH mUHDVRQDEOH UXOHVl OLPLWDWLRQ ,G DW  +RZHYHU DV WKH VWDJH RI WKH SURFHHGLQJV &I &RUHD  DW  DIILUPLQJ D JUDQW RI ,QWHUQDWLRQDO 8QLRQ QRWHV FRQWH[W LV NH\ $SSHOOHHVj %U DW  Q VXPPDU\ MXGJPHQW :DUG  ) 6XSS DW  JUDQWLQJ VXPPDU\ 7XUQHU LQYROYHG D FDQGLGDWH IRU VKRS VWHZDUG ZKR ZDV H[SHOOHG IURP KLV MXGJPHQW  7KHUHIRUH WKH TXHVWLRQ EHIRUH XV LV QRW ZKHWKHU 'RULW\ XQLRQ IRU mDGYRFDWLQJ &RPPXQLVW LGHDVl GXULQJ KLV FDPSDLJQ WKH 6HFRQG VKRXOG KDYH JUDQWHG MXULVGLFWLRQ WR /RFDO  EXW ZKHWKHU UHOLHI FRXOG EH &LUFXLW KHOG WKDW KLV H[SXOVLRQ YLRODWHG WKH /05'$ 7XUQHU   )G JUDQWHG WR /RFDO  DVVXPLQJ WKDW 'RULW\jV GHFLVLRQ WR JUDQW MXULVGLFWLRQ DW  FI 0DGGDORQH Y /RFDO  8QLWHG %KG RI &DUSHQWHUV WR /RFDO  ZDV XQUHDVRQDEOH DUELWUDU\ RU LPSURSHU :H OHDYH WKH sRLQHUV RI $P  )G   G &LU   UHDGLQJ WKH VFRSH RI GHWHUPLQDWLRQ RI RWKHU TXHVWLRQV WR WKH IXUWKHU SURFHHGLQJV IRU ZKLFK ZH †  D  jV SURWHFWLRQ DV mFRQFHUQLQJ FDQGLGDWHV DQG XQLRQ SROLFLHVl  UHPDQG WKLV FDVH  8QLWHG)RRGHWDOY8QLWHG)RRGHWDO 1R 1R 8QLWHG)RRGHWDOY8QLWHG)RRGHWDO IXWXUHZLWKRXWILUVWREWDLQLQJWKHDSSURSULDWHDXWKRUL]DWLRQl  GRHV QRW H[SODLQ ZK\ WKH UHTXLUHPHQW RI SULRU s$DW DXWKRUL]DWLRQLVXQUHDVRQDEOH)XUWKHUPRUHWKHLPSHWXVRI WKHWKZDUWHGER\FRWWZDV0HLMHUjVHPSOR\PHQWSUDFWLFHVQRW &RQVWUXLQJWKH)$&DQGWKHDWWDFKHGGRFXPHQWVLQWKHOLJKW WKH ,QWHUQDWLRQDO 8QLRQjV DXWKRUL]DWLRQ SURFHVV  ,Q RWKHU PRVWIDYRUDEOHWR/RFDO ZHXQGHUVWDQGWKLVEUHDFKRI ZRUGV/RFDO PLJKWKDYHKDGDYLDEOH† D  FODLP ILGXFLDU\GXW\FODLPWREHEDVHGRQDIDFWXDODOOHJDWLRQWKDW LI WKH ,QWHUQDWLRQDO 8QLRQ KDG DEULGJHG WKH ULJKW RI LWV /RFDO  ZRXOG KDYH RUJDQL]HG WKH HPSOR\HHV DW WKH PHPEHUVWRSURWHVWXQLRQSROLF\FRQFHUQLQJWKHDXWKRUL]DWLRQ %RZOLQJ*UHHQVWRUHDQGQHJRWLDWHGDPRUHIDYRUDEOHFRQWUDFW RIHFRQRPLFDFWLRQ$VIRUWKHGHQLDORIMXULVGLFWLRQ/RFDO EXW IRU 'RULW\ ZKR LPSURSHUO\ DVVLJQHG WKH VWRUH WR WKH VLPSO\DOOHJHVmDFKLOOLQJHIIHFWls$DW  )$&DW MXULVGLFWLRQRI/RFDO SHU0HLMHUjVLQVWUXFWLRQVEHFDXVH ˆ 7KHFRQQHFWLRQEHWZHHQWKHDVVLJQPHQWRIMXULVGLFWLRQ WKHODWWHUDIILOLDWHZRXOGQRWEDUJDLQDVKDUGDV/RFDO KDG DQG XQLRQ PHPEHUVj H[HUFLVH RI IUHH VSHHFK DQG DVVHPEO\ LQ7ROHGR/RFDO jVDELOLW\WRXQLRQL]HWKH%RZOLQJ*UHHQ ULJKWVKRZHYHULVWHQXRXVDWEHVW7KH8)&:&RQVWLWXWLRQ VWRUHLVWKXVWKHNH\WRWKLVFDVHIRU'RULW\jVDOOHJHGEUHDFK JUDQWVFRQVLGHUDEOHGLVFUHWLRQWRWKH,QWHUQDWLRQDO3UHVLGHQWLQ OLHVLQFKHFNLQJWKHEDUJDLQLQJVWUHQJWKWKDW/RFDO ZRXOG WKHPDNLQJRIMXULVGLFWLRQDOGHWHUPLQDWLRQVDIDFWWKDW/RFDO KDYHJDLQHGIURP DGGLQJWKHHPSOR\HHVDWWKDWVWRUHWRLWV UHFRJQL]HVLQLWVE\ODZV7KHUHIRUHZHDIILUPWKHGLVWULFW PHPEHUVKLS$OWKRXJKWKLVVFHQDULRVWULNHVXVDVXQOLNHO\LW FRXUWjVGLVPLVVDORIWKH† D  FODLP LVWKHRQO\RQHWKDWZHFDQFRQFHLYHLQZKLFK'RULW\ZRXOG KDYH EUHDFKHG KLV ILGXFLDU\ GXW\ WR XQLRQ PHPEHUV 6HFWLRQ 2WKHUZLVHWKHSDUWLHVjGLVSXWHLVHVVHQWLDOO\RQHRYHUVWUDWHJ\ /RFDO EHOLHYHVWKDWKDUGEDUJDLQLQJOHDGVWREHWWHUUHVXOWV 6HFWLRQ  RI WKH /05'$ SURYLGHV D FDXVH RI DFWLRQ DVGHPRQVWUDWHGE\WKHFROOHFWLYHEDUJDLQLQJDJUHHPHQWWKDW DJDLQVW WKH RIILFHUV DQG DJHQWV RI ODERU RUJDQL]DWLRQV ZKR ZDV ILQDOO\ UHDFKHG IRU WKH 0HLMHU VWRUHV LQ 7ROHGR ZKLOH EUHDFKFHUWDLQILGXFLDU\GXWLHV 86&† D /LNHWKH 'RULW\DYHUVWKDWVXFKDFDPSDLJQZRXOGKDYHEDFNILUHGIRU GLVWULFWFRXUWZHNHHSWKHIROORZLQJLQPLQG WKH 0HLMHU VWRUH LQ %RZOLQJ *UHHQ DQG HIIHFWLYHO\ OHIW WKH HPSOR\HHVZLWKQRUHSUHVHQWDWLRQDWDOO7KHIDFWVDVSRVLWHG 7KHSULPDU\SXUSRVHRI 86&† D LVWRHQVXUH DERYHKRZHYHUVXJJHVWWKDW'RULW\DFWHGXQUHDVRQDEO\DQG WKDWXQLRQRIILFLDOVGRQRWYLRODWHWKHLUILGXFLDU\GXWLHVWR DUELWUDULO\LQGHQ\LQJMXULVGLFWLRQRIWKH%RZOLQJ*UHHQVWRUH WKHPHPEHUVRIWKHLURUJDQL]DWLRQE\HQJDJLQJLQVHOI WR/RFDO %HFDXVHUHOLHIFRXOGEHJUDQWHGRQWKHVHIDFWV GHDOLQJRUWKHPLVXVHRIXQLRQIXQGVZKLFKWKH\KROGLQ ZH UHYHUVH WKH GLVWULFW FRXUWjV GLVPLVVDO RI WKH EUHDFK RI WUXVW+RZHYHUWKHVWDWXWHLVQRWPHDQWDVDYHKLFOHIRU ILGXFLDU\ GXW\ FODLP DV LW UHODWHV WR 'RULW\jV DOOHJHG MXGLFLDORYHUVLJKWRIXQLRQDFWLYLW\EXWRQO\DVDPHDQV PRWLYDWLRQ IRU DVVLJQLQJ WKH %RZOLQJ *UHHQ VWRUH WR WKH RIUHGUHVVLQJXQUHDVRQDEOHDQGDUELWUDU\DFWLRQVE\XQLRQ MXULVGLFWLRQRI/RFDO LQVWHDGRI/RFDO  RIILFLDOV  7KH IHGHUDO FRXUWV GR QRW VLW DV D mVXSHU UHYLHZlERDUGRILQWHUQDOXQLRQJULHYDQFHVXQOHVVWKHUH LVHYLGHQFHRILPSURSULHW\LQWKHSURFHHGLQJV  7KH GLVVHQW PDLQWDLQV WKDW WKH GLVWULFW FRXUWjV GLVPLVVDO RI WKLV FODLP &RUHD )GDW,WEHDUVUHSHDWLQJHVSHFLDOO\LQWKH VKRXOG EH DIILUPHG EHFDXVH /RFDO jV GLVSXWH LV RYHU MXULVGLFWLRQ DQG FRQWH[WRIWKLVFDVHWKDW†YLRODWLRQVJHQHUDOO\LQYROYH LWV DFWLRQ FRQFHUQV D ORVV RI HFRQRPLF UDWKHU WKDQ GHPRFUDWLF ULJKWV $V mXQUHDVRQDEOHDQGDUELWUDU\DFWLRQVlVXFKDVmVHOIGHDOLQJRU DOOHJHG LQ /RFDO jV SOHDGLQJV KRZHYHU 'RULW\jV GHFLVLRQ WR DVVLJQ WKH WKH PLVXVH RI XQLRQ IXQGVl  ,G  :H KDYH UHFRJQL]HG KRZHYHUWKDW†mFRQWDLQVQRQILQDQFLDODVSHFWVlDQGPD\ %RZOLQJ *UHHQ VWRUH WR WKH MXULVGLFWLRQ RI /RFDO  ZDV LPSURSHUO\ LQIOXHQFHG E\ 0HLMHU 0HLMHUjV LQIOXHQFH RQ XQLRQ DFWLYLW\ LQ WXUQ ZRXOG XQGRXEWHGO\ GHQ\ /RFDO  WKH GHPRFUDWLF ULJKW WR IDLU UHSUHVHQWDWLRQ EHYLRODWHGZKHQmXQLRQRIILFLDOV>FDXVH@XQLRQPHPEHUVWR  8QLWHG)RRGHWDOY8QLWHG)RRGHWDO 1R 1R 8QLWHG)RRGHWDOY8QLWHG)RRGHWDO  VXIIHU µDQ LQYDOXDEOH DQG LUUHSDUDEOH ORVV RI GHPRFUDWLF 'RULW\mKDVVXERUGLQDWHGWKH,QWHUQDWLRQDO8QLRQWR0HLMHUjV ULJKWVjl,GDW TXRWLQJ:DGHY7HDPVWHUV/RFDO ZLVKHVl s$ DW   WR WKH SRLQW ZKHUH 0HLMHU mGLFWDWH>V@ )6XSS  ('0LFK   PDWWHUVRILQWHUQDOXQLRQSROLF\ls$DWLQFOXGLQJ 'RULW\jVGHFLVLRQWRDVVLJQWKH%RZOLQJ*UHHQVWRUHWRWKH /RFDO jVILUVW†FODLPDOOHJHVPLVXVHRIXQLRQIXQGV MXULVGLFWLRQRI/RFDO /RFDO PDLQWDLQVWKDWWKLV DQGUHODWHVWRDQRIIHUE\'RULW\mWRJLYH/RFDO WKHµORVW VXEVHUYLHQFHWR0HLMHUSULRULWL]HVHQVXULQJWKHIORZRIGXHV GXHVj IURP WKH %RZOLQJ *UHHQ VWRUH ZLWK QR VHUYLFLQJ PRQH\RYHUYLJRURXVO\UHSUHVHQWLQJWKHXQLRQPHPEHUVZKR REOLJDWLRQDQGPRQWKO\SD\PHQWVZKLFKZRXOGKDYHWREH SD\WKRVHGXHV/RFDO DOVRDOOHJHVWKDW'RULW\XQGHUFXW GHVLJQDWHGDVRUJDQL]LQJIXQGVRQWKHERRNVls$DW /RFDO LQYLRODWLRQRI†ZKHQKHVHQWm(DUO+ROWRQD $FFRUGLQJWR*HOLRV'RULW\RIIHUHGWKHVHmRUJDQL]LQJlIXQGV KLJKUDQNLQJRIILFLDORI0HLMHUls$DW  )$&DWˆ D WRSHUVXDGH/RFDO WRGURSLWVREMHFWLRQWRDQDVVLJQPHQW FRS\RIDQ2FWREHU OHWWHUWKDWRUGHUHG/RFDO QRW RIMXULVGLFWLRQWKDWUHVXOWHGLQmDFRQWUDFW>IRUWKH%RZOLQJ WRER\FRWW0HLMHURUWRmWDNHDQ\RWKHUHFRQRPLFDFWLRQLQWKH *UHHQ HPSOR\HHV@ ZLWK ZDJHV DQG ZRUNLQJ FRQGLWLRQV LQIHULRUWRDQ\RI/RFDO jV0HLMHUFRQWUDFWVls$DW $VQRWHGE\WKHGLVWULFWFRXUWWKHSOHDGLQJVmGR>@QRW LQGLFDWHWKDWDQ\PRQH\ZDVHYHUDFWXDOO\WUDQVIHUUHGWR/RFDO l8QLWHG)RRG )6XSSGDW )$& FKDUJHG 'RULW\ DQG 5HJLRQ  ZLWK †  YLRODWLRQV s$ DW  )$& DW ˆ   %HFDXVH /RFDO  GRHV QRW DSSHDO WKH GLVWULFW FRXUWjV GLVPLVVDO RI WKH FODLP DJDLQVW 5HJLRQ  $SSHOODQWVj %U DW  Q ZH ZLOO $OWKRXJKZHDFFHSW/RFDO jVIDFWXDODOOHJDWLRQVDVWUXH GLVFXVV /RFDO jV DOOHJDWLRQV DJDLQVW 'RULW\ RQO\ ZHEHOLHYHWKDWWKHGLVWULFWFRXUWGLGQRWHUULQGLVPLVVLQJWKH FODLPIRUPLVXVHRIXQLRQIXQGV/RFDO DUJXHVWKDW'RULW\  ,Q D 6HSWHPEHU     OHWWHU WR *HOLRV ZKLOH 0HLMHU DQG /RFDO LVOLDEOHXQGHU†EHFDXVHWKHDOOHJHGSXUSRVHEHKLQGKLV  ZHUH QHJRWLDWLQJ D VXFFHVVRU FROOHFWLYH EDUJDLQLQJ DJUHHPHQW IRU WKH RIIHUnRUmDWWHPSWHGSD\RIIl$SSHOODQWVj%UDWnZDV IRXU 7ROHGR VWRUHV D 0HLMHU H[HFXWLYH VWDWHG WKDW mEDVHG RQ WKH KLVWRU\ LQFRQVLVWHQWZLWKWKH,QWHUQDWLRQDO8QLRQjVVWDWHGREMHFWLYHRI ZLWK /RFDO  ZH EHOLHYH WKDW LW ZRXOG EH LQ WKH EHVW LQWHUHVW RI WKH HOHYDWLQJWKHSRVLWLRQRILWVPHPEHUV%UHDFKHVRIILGXFLDU\ FRPSDQ\ WR ZRUN ZLWK D GLIIHUHQW ORFDO LQ QHZ XQLWVl s$ DW  GXW\KRZHYHULQYROYHLQMXULHVVHHHJ6WURFNY3UHVVQHOO  1(G 2KLR  DQG/RFDO GRHVQRW $OWKRXJK WKH EDVLV IRU WKLV DOOHJDWLRQ LV QRW SODLQO\ HYLGHQW IURP WKH SDUWLHVj EULHIV LW DSSHDUV WKDW WKHUH ZHUH DOWHUQDWH URXWHV WR 0HLMHUjV DOOHJH WKDW 'RULW\jV RIIHU SHU VH FDXVHG DQ\ LQMXU\ WR WKH UHFRJQLWLRQ RI DQ ,QWHUQDWLRQDO 8QLRQ DIILOLDWH DV WKH FROOHFWLYH EDUJDLQLQJ ,QWHUQDWLRQDO8QLRQRULWVPHPEHUV,QRWKHUZRUGV/RFDO UHSUHVHQWDWLYH RI LWV HPSOR\HHV DW WKH %RZOLQJ *UHHQ VWRUH ZKLFK ZRXOG jVUHIXVDORIWKHRIIHUSUHYHQWHG'RULW\IURPDFWXDOL]LQJ SUHVXPDEO\ UHVXOW LQ WKH SD\PHQW RI GXHV PRQH\ WR WKH ,QWHUQDWLRQDO KLVDOOHJHGLQWHQWWRPLVXVHXQLRQIXQGV 8QLRQ  WKH 1DWLRQDO /DERU 5HODWLRQV %RDUG m1/5%l FRXOG KDYH FRQGXFWHG D VHFUHW EDOORW HOHFWLRQ RU  0HLMHU FRXOG KDYH ZDLYHG LWV ULJKW /RFDO jVUHPDLQLQJDOOHJDWLRQVFRQFHUQWKH,QWHUQDWLRQDO WR DQ 1/5% HOHFWLRQ DQG YROXQWDULO\ UHFRJQL]HG D XQLRQ WKURXJK FDUG FKHFN UHFRJQLWLRQ DV LW SUHVXPDEO\ GLG LQ UHFRJQL]LQJ /RFDO   6HH 8QLRQjV UHODWLRQVKLS ZLWK 0HLMHU LQ JHQHUDO DQG 'RULW\jV JHQHUDOO\ 7+( '(9(/23,1* / $%25 /$:    3DWULFN +DUGLQ GHDOLQJVZLWK0HLMHULQSDUWLFXODU $FFRUGLQJWR/RFDO  sRKQ ( +LJJLQV sU HGV WK HG   8QGHU FDUG FKHFN UHFRJQLWLRQ XQLRQ RUJDQL]HUV SUHVHQW DQ HPSOR\HU ZLWK XQLRQ DXWKRUL]DWLRQ FDUGV VLJQHG E\ D PDMRULW\ RI WKH HPSOR\HHV DW    'RULW\ EHOLHYHG WKDW 0HLMHU ZRXOG QRW JUDQW FDUG FKHFN UHFRJQLWLRQ WR /RFDO  DQG WKDW ,G  /RFDO  ZRXOG QRW VXFFHHG LQ DQ 1/5% HOHFWLRQ *HOLRV KRZHYHU FRQWHQGV mWKDW 0HLMHU KROGV EDFN UHFRJQLWLRQ WR H[HUW OHYHUDJH DQG ,Q LWV EULHI /RFDO  DYRLGV VLQJOLQJ RXW 'RULW\ LQVWHDG FKDUJLQJ

H[SHFWV FRQVLGHUDWLRQ LQ UHWXUQ IRU UHFRJQLWLRQ ZLWKRXW HOHFWLRQl s$ DW WKH ,QWHUQDWLRQDO 8QLRQ ZLWK YDULRXV mILQDQFLDO LPSURSULHWLHVl

 $SSHOODQWVj %U DW  6HFWLRQ  KRZHYHU DSSOLHV WR mRIILFHUV RI ODERU RUJDQL]DWLRQV    >ZKR@ RFFXS\ SRVLWLRQV RI WUXVWl  86& †  7KH