02a0120p.06

7KH +RQRUDEOH -RKQ 5 *LEVRQ &LUFXLW -XGJH RI WKH 8QLWHG 6WDWHV
&RXUW RI $SSHDOV IRU WKH (LJKWK &LUFXLW VLWWLQJ E\ GHVLJQDWLRQ

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(' 67$7(6 2) $0(5,&$
3ODLQWLII$SSHOOHH
Y
'(55,&. 7$</25
'HIHQGDQW$SSHOODQW
;!

1
1R
$SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW
IRUWKH1RUWKHUQ'LVWULFWRI2KLRDW&OHYHODQG
1R²$QQ$OGULFK'LVWULFW-XGJH
$UJXHG6HSWHPEHU
'HFLGHGDQG)LOHG$SULO
%HIRUH6,/(5&/$<DQG*,%621&LUFXLW-XGJHV
BBBBBBBBBBBBBBBBB
&2816(/
$5*8(''HQQLV*7HUH]&OHYHODQG2KLRIRU$SSHOODQW
(GZDUG ) )HUDQ $66,67$17 81,7(' 67$7(6
$77251(<&OHYHODQG2KLRIRU$SSHOOHH21%5,()
'HQQLV*7HUH]&OHYHODQG2KLRIRU$SSHOODQW(GZDUG)

-- 1 of 4 --

8QLWHG6WDWHVY7D\ORU 1R
7KH +RQRUDEOH $QQ $OGULFK 8QLWHG 6WDWHV 'LVWULFW -XGJH IRU WKH
1RUWKHUQ 'LVWULFW RI 2KLR
:H FLWH WKH YHUVLRQ RI WKH JXLGHOLQHV EHFDXVH WKDW ZDV WKH
YHUVLRQ LQ HIIHFW DW WKH WLPH RI VHQWHQFLQJ 0D\ 6HH 866*
† % D 1RY FRXUW VKDOO XVH JXLGHOLQH LQ HIIHFW DW WLPH RI
VHQWHQFLQJ
)HUDQ $66,67$17 81,7(' 67$7(6 $77251(<
&OHYHODQG2KLRIRU$SSHOOHH
BBBBBBBBBBBBBBBBB
23,1,21
BBBBBBBBBBBBBBBBB
-2+15*,%621&LUFXLW-XGJH'HUULFN7D\ORUDSSHDOV
IURPWKHVHQWHQFHLPSRVHGXSRQKLPIROORZLQJKLVSOHDRI
JXLOW\WRHQWHULQJRUEHLQJIRXQGLQWKH8QLWHG6WDWHVZLWKRXW
SHUPLVVLRQ DIWHU GHSRUWDWLRQ IRU D IHORQ\ 86&
† E +HFRQWHQGVWKDWWKHGLVWULFWFRXUWHUUHG
LQ UHIXVLQJ WR GHSDUW GRZQZDUG IURP WKH 6HQWHQFLQJ
*XLGHOLQHV UDQJH WR WDNH LQWR DFFRXQW WKH IDFW WKDW KLV
SUHYLRXV IHORQLHV ZHUH QRW VHULRXV RQHV :H DIILUP WKH
VHQWHQFHLPSRVHGE\WKHGLVWULFWFRXUW
7D\ORUZDVFRQYLFWHGWZLFHIRUGUXJWUDIILFNLQJRQFHLQ
*HRUJLD LQ DQG RQFH LQ 7HQQHVVHH LQ +H ZDV
GHSRUWHG LQ EXW UHWXUQHG WR WKLV FRXQWU\ ZLWKRXW
SHUPLVVLRQ$IWHUKHZDVIRXQGLQ0DSOH+HLJKWV2KLRLQ
1RYHPEHUKHZDVLQGLFWHGIRULOOHJDOHQWU\DQGSOHG
JXLOW\ 7KH 6HQWHQFLQJ *XLGHOLQHV SUHVFULEHG D FULPLQDO
KLVWRU\FDWHJRU\RI,97KHDSSOLFDEOHRIIHQVHJXLGHOLQHZDV
8QLWHG6WDWHV6HQWHQFLQJ&RPPLVVLRQ*XLGHOLQHV0DQXDO
†/ E 1RY ZKLFKFDUULHVDEDVHRIIHQVHOHYHO
RI%HFDXVH7D\ORUHQWHUHGWKHFRXQWU\DIWHUEHLQJGHSRUWHG
IROORZLQJ FRQYLFWLRQ IRU DQ DJJUDYDWHG IHORQ\ KLV EDVH
RIIHQVH OHYHO ZDV LQFUHDVHG E\ ±D WKUHHIROG LQFUHDVH
5HGXFWLRQRIWKHRIIHQVHOHYHOIRUDFFHSWDQFHRIUHVSRQVLELOLW\
OHIW7D\ORUZLWKDJXLGHOLQHUDQJHRIPRQWKV

-- 2 of 4 --

8QLWHG6WDWHVY7D\ORU 1R
RQO\LIWKHGHIHQGDQWVDWLVILHVDOOWKUHHFULWHULDHQXPHUDWHGLQ
$SSOLFDWLRQ1RWH FHUWGHQLHG6&W
8QLWHG6WDWHVY0DUTXH]*DOOHJRV)G
WK&LU FHUWGHQLHG86 8QLWHG6WDWHV
Y<DQH]+XHUWD)G WK&LU SHUFXULDP
ILYH\HDUVXVSHQGHGWHUPRILPSULVRQPHQWH[FHHGHGRQH\HDU
PD[LPXPVSHFLILHGLQ1RWHPDNLQJGHIHQGDQWLQHOLJLEOH
IRUGHSDUWXUHEDVHGRQUHODWLYHO\PLQRUQDWXUHRIFRQYLFWLRQ
FHUWGHQLHG86 8QLWHG6WDWHVY7DSSLQ
)G G&LU >$@VHQWHQFLQJFRXUWODFNVWKH
SRZHUWRJUDQWDGRZQZDUGGHSDUWXUHXQGHU866*†/
EDVHG RQ WKH VHULRXVQHVV RI D SUHGLFDWH DJJUDYDWHG IHORQ\
DEVHQW VDWLVIDFWLRQ RI DOO WKUHH HQXPHUDWHG FULWHULD LQ
$SSOLFDWLRQ1RWH FHUWGHQLHG86 DQG
8QLWHG6WDWHVY0F.HQ]LH)G G&LU
ZLWK8QLWHG6WDWHVY$OIDUR=D\DV)G
WK&LU SHUFXULDP LQFDVHZKHUHGHIHQGDQWGLGQRW
PHHW$SSOLFDWLRQ1RWHFULWHULDVWDWLQJWKDWGLVWULFWFRXUW
FRXOGKDYHGHSDUWHGEDVHGRQVPDOODPRXQWRIGUXJVLQYROYHG
LQ HDUOLHU IHORQ\ EXW DIILUPLQJ GLVWULFW FRXUW V GHQLDO RI
GHSDUWXUH 8QLWHG6WDWHVY6DQFKH]5RGULJXH])G
WK&LU HQEDQF GHFLGHGZLWKRXWUHIHUHQFHWR
$SSOLFDWLRQ 1RWH DQG 8QLWHG 6WDWHV Y 'LD]'LD]
)G WK &LU DIILUPLQJ GLVWULFW FRXUW V
GRZQZDUGGHSDUWXUHRQJURXQGRIVHULRXVQHVVRISULRUIHORQ\
ZLWKRXW GLVFXVVLRQ RI ZKHWKHU GHIHQGDQW PHW $SSOLFDWLRQ
1RWHFULWHULD
:HDUHSHUVXDGHGWKDWRXURZQHDUOLHUXQSXEOLVKHGRSLQLRQ
DQG WKH ZHLJKW RI DXWKRULW\ DUH FRUUHFW LQ KROGLQJ WKDW D
GHIHQGDQW ZKR GLG QRW TXDOLI\ IRU D GHSDUWXUH XQGHU
$SSOLFDWLRQ1RWH ZKHQLWZDVLQHIIHFW ZDVQRWHQWLWOHGWR
D GHSDUWXUH RQ WKH JURXQG WKDW KLV HDUOLHU IHORQ\ ZDV QRW
VXIILFLHQWO\VHULRXVWREULQJKLPZLWKLQWKHKHDUWODQGRI866*
†/ E $ 1RY $FFRUGLQJO\ZHDIILUPWKH
VHQWHQFHLPSRVHGE\WKHGLVWULFWFRXUW
1R 8QLWHG6WDWHVY7D\ORU
*XLGHOLQH † / ZDV WKRURXJKO\ RYHUKDXOHG LQ 1RYHPEHU
DQG IRUPHU $SSOLFDWLRQ 1RWH HOLPLQDWHG VHH $PHQGPHQW 866*
$SS & 6XSS EXW QR RQH KDV DUJXHG WKDW WKLV DPHQGPHQW VKRXOG
KDYH DQ\ HIIHFW LQ WKLV FDVH 3DUHQWKHWLFDOO\ LI WKH $PHQGPHQW ZDV
DSSOLFDEOH LW ZRXOG DSSDUHQWO\ GLFWDWH WKH VDPH UHVXOW WKH GLVWULFW FRXUW
UHDFKHG LQ WKLV FDVH 7D\ORU V FRFDLQH WUDIILFNLQJ FRQYLFWLRQ UHVXOWHG LQ D
WZHQW\ILYH \HDU VHQWHQFH DQG WKH DPHQGHG VHFWLRQ / SUHVFULEHV D
SRLQW LQFUHDVH LI WKH SULRU FRQYLFWLRQ ZDV D GUXJ WUDIILFNLQJ RIIHQVH IRU
ZKLFK WKH VHQWHQFH LPSRVHG H[FHHGHG PRQWKV
7D\ORUDVNHGWKHGLVWULFWFRXUWWRGHSDUWGRZQZDUGIURP
WKH*XLGHOLQHV VHQWHQFLQJUDQJHRQWZRJURXQGVWKHFULPLQDO
KLVWRU\ FDWHJRU\ RYHUVWDWHG WKH VHULRXVQHVV RI KLV SDVW
FRQGXFWDQGWKHWKUHHIROGLQFUHDVHLQKLVRIIHQVHOHYHODOVR
RYHUVWDWHGWKHVHULRXVQHVVRIKLVRIIHQVHDQGWKHKDUPFDXVHG
E\LW7KHGLVWULFWFRXUWJUDQWHGDGRZQZDUGGHSDUWXUHE\
XVLQJWKHFULPLQDOKLVWRU\FDWHJRU\RI,,,UDWKHUWKDQ,9EXW
GHQLHG WKH UHTXHVWHG RIIHQVHOHYHO UHGXFWLRQ 7KH FRXUW
UHDVRQHGWKDW$SSOLFDWLRQ1RWHWR*XLGHOLQH†/ 1RY
WRRNLQWRDFFRXQWWKHVHULRXVQHVVRIWKHXQGHUO\LQJ
IHORQLHV E\ VHWWLQJ RXW WKH FLUFXPVWDQFHV XQGHU ZKLFK D
GRZQZDUG GHSDUWXUH ZRXOG EH DSSURSULDWH EHFDXVH RI WKH
QDWXUHRIWKHSUHGLFDWHIHORQLHV7KHFRXUWVWDWHGWKDWXQGHU
$SSOLFDWLRQ 1RWH D GRZQZDUG GHSDUWXUH PLJKW EH
ZDUUDQWHGZKHUH $ WKHGHIHQGDQWKDGRQO\RQHSUHYLRXV
IHORQ\FRQYLFWLRQ % WKDWSUHYLRXVIHORQ\ZDVQRWDFULPHRI
YLROHQFH RU D ILUHDUPV RIIHQVH DQG & WKH WHUP RI
LPSULVRQPHQWLPSRVHGIRUWKDWIHORQ\ZDVQRWPRUHWKDQD
\HDU%HFDXVH7D\ORUKDGEHHQFRQYLFWHGRIPRUHWKDQRQH
IHORQ\DQGRQHRIWKRVHIHORQLHVKDGUHVXOWHGLQDVHQWHQFHRI
PRUHWKDQRQH\HDUWKHFRXUWKHOGWKDW7D\ORUZDVLQHOLJLEOH
IRUDGRZQZDUGGHSDUWXUHRQKLVRIIHQVHOHYHO
7KHFRXUWDUULYHGDWDVHQWHQFHUDQJHRIPRQWKVDQG
LWVHQWHQFHG7D\ORUWRPRQWKVLPSULVRQPHQWIROORZHGE\
WZR\HDUVRIVXSHUYLVHGUHOHDVH
7D\ORUDSSHDOVDUJXLQJWKDWWKHGLVWULFWFRXUWLQFRUUHFWO\
FRQFOXGHGWKDWKHZDVQRWHOLJLEOHIRUDGRZQZDUGGHSDUWXUH
WR WDNH LQWR DFFRXQW WKH QDWXUH RI KLV SUHYLRXV IHORQLHV
EHFDXVHKHGLGQRWPHHWWZRRIWKHWKUHHFRQGLWLRQVVWDWHGLQ

-- 3 of 4 --

8QLWHG6WDWHVY7D\ORU 1R
$SSOLFDWLRQ 1RWH 7KH JRYHUQPHQW UHVSRQGV WKDW WKH
GLVWULFWFRXUW VIDLOXUHWRGHSDUWZDVDQXQUHYLHZDEOHH[HUFLVH
RIGLVFUHWLRQ
$ GLVWULFW FRXUW V GLVFUHWLRQDU\ GHFLVLRQ QRW WR GHSDUW
GRZQZDUGIURPWKHJXLGHOLQHVLVXQUHYLHZDEOHVRORQJDVWKH
GLVWULFWFRXUWXQGHUVWDQGVWKDWLWKDVGLVFUHWLRQVRWRGHSDUW
8QLWHG 6WDWHV Y (EROXP )G WK &LU
+RZHYHUZKHQWKHGLVWULFWFRXUWLQWHUSUHWVWKHJXLGHOLQHVWR
SURKLELWDGHSDUWXUHWKDWGHWHUPLQDWLRQLVUHYLHZDEOH8QLWHG
6WDWHV Y &ROHPDQ )G WK &LU HQ
EDQF 7KLV ZDV VXFK D FDVH 7KH GLVWULFW FRXUW VDLG DW
VHQWHQFLQJ
>$@SSOLFDWLRQ QRWH XQHTXLYRFDOO\ SURYLGHV WKDW D
GRZQZDUG GHSDUWXUH PD\ EH ZDUUDQWHG EDVHG RQ WKH
UHODWLYHXQVHULRXVQHVVRIWKHXQGHUO\LQJFRQYLFWLRQZKHQ
WKH WKUHH IDFWRUV OLVWHG WKHUHLQ DUH SUHVHQW 7KH
JRYHUQPHQWFRUUHFWO\REVHUYHVWKDWDWOHDVWWKH7HQWKDQG
)LIWK &LUFXLWV UHDG WKLV DSSOLFDWLRQ QRWH OLWHUDOO\ DQG
UHTXLUH DOO WKUHH IDFWRUV WR EH SUHVHQW IRU D GRZQZDUG
GHSDUWXUH WR EH MXVWLILHG 7KH 6L[WK &LUFXLW KDV QRW
DGGUHVVHG WKLV LVVXH EXW WKLV &RXUW KDV QR UHDVRQ WR
EHOLHYH WKDW WKH 6L[WK &LUFXLW ZRXOG QRW UHTXLUH
DSSOLFDWLRQ QRWH WR EH VDWLVILHG EHIRUH SHUPLWWLQJ D
GRZQZDUGGHSDUWXUHLQWKLVFRQWH[W
/DWHU WKH FRXUW DGGHG , UHDOO\ VLQFHUHO\ DSSUHFLDWH WKH
DUJXPHQWV>7D\ORU VFRXQVHO@LVPDNLQJEXW,MXVWGRQ WWKLQN
WKDW,FDQGHYLDWHIURPWKHVWDWXWHDV,XQGHUVWDQGLW$QG,
FDQRQO\KRSHWKDWSHUKDSV, PZURQJDQGWKH6L[WK&LUFXLW
ZLOOVWUDLJKWHQLWRXWIRUHYHU\ERG\
7KH GLVWULFW FRXUW REYLRXVO\ NQHZ WKDW WKH 6L[WK &LUFXLW
ZRXOGQRWEHUHYLHZLQJWKHGHQLDORIGHSDUWXUHXQOHVVLWZDV
EDVHGRQODFNRIDXWKRULW\WRGHSDUW7KXVWKHGLVWULFWFRXUW V
GHFLVLRQ WKDW LW FRXOG QRW GHSDUW ZDV D UHYLHZDEOH OHJDO
GHWHUPLQDWLRQ$OWKRXJKZHUHYLHZDGLVWULFWFRXUW VEHOLHI
WKDWLWODFNHGDXWKRULW\WRGHSDUWXQGHUDQDEXVHRIGLVFUHWLRQ
VWDQGDUG &ROHPDQ )G DW DQ HUURQHRXV OHJDO
GHWHUPLQDWLRQ LV DOZD\V DQ DEXVH RI GLVFUHWLRQ ,G VHH
1R 8QLWHG6WDWHVY7D\ORU
8QLWHG6WDWHVY3ULQFH)G WK&LU 7KH
GLVWULFWFRXUW VGHWHUPLQDWLRQWKDWLWODFNHGDXWKRULW\WRGHSDUW
GRZQZDUGLVFRQVLGHUHGDQLVVXHRI*XLGHOLQHVLQWHUSUHWDWLRQ
WKDWZHUHYLHZGHQRYR FHUWGHQLHG86
$GLVWULFWFRXUWFDQH[HUFLVHLWVGLVFUHWLRQWRGHSDUWIURPWKH
VHQWHQFLQJ JXLGHOLQHV UDQJH ZKHQ D GHIHQGDQW V FDVH IDOOV
RXWVLGHWKHKHDUWODQGRIWKHDSSOLFDEOHJXLGHOLQHEHFDXVHWKH
FDVHSUHVHQWVDIDFWRUWKDWZDVQRWWDNHQLQWRDFFRXQWE\WKH
6HQWHQFLQJ&RPPLVVLRQRUEHFDXVHDIDFWRULVSUHVHQWLQD
GHJUHHRUIRUPQRWFRQWHPSODWHG6HH.RRQY8QLWHG6WDWHV
86 ,IWKHVSHFLDOIDFWRULVDGLVFRXUDJHG
IDFWRURUDQHQFRXUDJHGIDFWRUDOUHDG\WDNHQLQWRDFFRXQWE\
WKHDSSOLFDEOH*XLGHOLQHWKHFRXUWVKRXOGGHSDUWRQO\LIWKH
IDFWRULVSUHVHQWWRDQH[FHSWLRQDOGHJUHHRULQVRPHRWKHU
ZD\PDNHVWKHFDVHGLIIHUHQWIURPWKHRUGLQDU\FDVHZKHUHWKH
IDFWRULVSUHVHQW &ROHPDQ)GDW $GRZQZDUG
GHSDUWXUHLVSHUPLWWHGZKHQWKHUHLVDPLWLJDWLQJIDFWRUWKDW
KDV QRW EHHQ DGHTXDWHO\ FRQVLGHUHG LQ IRUPXODWLQJ WKH
6HQWHQFLQJ *XLGHOLQHV $ GHIHQGDQW PD\ QRW UHFHLYH D
GHSDUWXUHEDVHGRQWKHSUHVHQFHRIDIDFWRUDOUHDG\DGHTXDWHO\
WDNHQ LQWR DFFRXQW LQ WKH JXLGHOLQHV 6HH 8QLWHG 6WDWHV Y
6DXFHGR)G WK&LU FHUWGHQLHG
86
,QDQXQSXEOLVKHGGHFLVLRQILOHGDIWHUDUJXPHQWLQWKLVFDVH
ZHKHOGWKDWDGHIHQGDQWZKRGLGQRWTXDOLI\IRUDGHSDUWXUH
XQGHU$SSOLFDWLRQ1RWHZDVQRWHOLJLEOHIRUGHSDUWXUHRQWKH
JURXQGRIVHULRXVQHVVRIWKHHDUOLHUIHORQ\8QLWHG6WDWHVY
6DQFKH]6DQFKH] )HG $SS[ WK &LU
+HUH'HIHQGDQWGRHVQRWTXDOLI\IRUDGRZQZDUGGHSDUWXUH
XQGHU$SSOLFDWLRQ1RWHZKLFKHVVHQWLDOO\HVWDEOLVKHGWKH
KHDUWODQG IRUSXUSRVHVRI866*†/
7KLV XQSXEOLVKHG GHFLVLRQ ZDV LQ DFFRUG ZLWK WKH YDVW
PDMRULW\RIDSSOLFDEOHFDVHVIURPRWKHUFLUFXLWV&RPSDUH
8QLWHG6WDWHVY3DORPLQR5LYHUD)G WK&LU
,QSURPXOJDWLQJ$SSOLFDWLRQ1RWHWKH&RPPLVVLRQ
GHILQHGWKHKHDUWODQGRI†/E\H[FOXVLRQDGRZQZDUG
GHSDUWXUHIURPWKHVL[WHHQSRLQWHQKDQFHPHQWLVDXWKRUL]HG

-- 4 of 4 --