02a0431p.06

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
-2<&( . $1*(/LQGLYLGXDOO\
DQGRQEHKDOIRIDOORWKHUV
VLPLODUO\VLWXDWHG
3ODLQWLII$SSHOODQW
Y
&20021:($/7+ 2)
.(178&.< .(178&.<
75$163257$7,21 &$%,1(7
-$0(6 & &2'(// ,,,LQKLV
RIILFLDOFDSDFLW\DV6HFUHWDU\
RI7UDQVSRUWDWLRQ',9,6,21
2) 9(+,&/( 5(*,675$7,21
(' /2*6'21LQKLVRIILFLDO
FDSDFLW\DV&RPPLVVLRQHURI
9HKLFOH5HJLVWUDWLRQ
'HIHQGDQWV$SSHOOHHV
;!

1
1R
$SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW
IRUWKH(DVWHUQ'LVWULFWRI.HQWXFN\DW)UDQNIRUW
1R²-RVHSK0+RRG'LVWULFW-XGJH
$UJXHG1RYHPEHU
'HFLGHGDQG)LOHG'HFHPEHU

-- 1 of 4 --

$QJHOY&RPPRQZHDOWK
RI.HQWXFN\HWDO
1R
7KH +RQRUDEOH $UWKXU - 7DUQRZ 8QLWHG 6WDWHV 'LVWULFW -XGJH IRU
WKH (DVWHUQ 'LVWULFW RI 0LFKLJDQ VLWWLQJ E\ GHVLJQDWLRQ
%HIRUH0(55,77DQG*,/0$1&LUFXLW-XGJHV
7$512:'LVWULFW-XGJH
BBBBBBBBBBBBBBBBB
&2816(/
$5*8(' 0LFKDHO * %UDXWLJDP *(1( 0(6+
$662&,$7(6&LQFLQQDWL 2KLRIRU$SSHOODQW'%UHQW
,UYLQ2)),&(2)7+($77251(<*(1(5$/)UDQNIRUW
.HQWXFN\ IRU $SSHOOHHV 21 %5,() 0LFKDHO *
%UDXWLJDP *(1( 0(6+ $662&,$7(6 &LQFLQQDWL
2KLR IRU $SSHOODQW ' %UHQW ,UYLQ 2)),&( 2) 7+(
$77251(< *(1(5$/ )UDQNIRUW .HQWXFN\ IRU
$SSHOOHHV
BBBBBBBBBBBBBBBBB
23,1,21
BBBBBBBBBBBBBBBBB
521$/'/((*,/0$1&LUFXLW-XGJH-R\FH.$QJHO
ILOHGVXLWRQEHKDOIRIKHUVHOIDQGDOORWKHUVVLPLODUO\VLWXDWHG
FKDOOHQJLQJ WKH IHH FKDUJHG E\ WKH &RPPRQZHDOWK RI
.HQWXFN\ IRU WKH XVH RI D SDUNLQJ SODFDUG DYDLODEOH WR
GLVDEOHGSHUVRQV$QJHOFODLPVWKDWWKHVHIHHVDUH³LOOHJDO
VXUFKDUJHV´XQGHU7LWOH,,RIWKH$PHULFDQVZLWK'LVDELOLWLHV
$FW $'$ .HQWXFN\ RQ WKH RWKHU KDQG DUJXHV WKDW WKH
QRPLQDOIHHLVDFWXDOO\DWD[ZKLFKGLYHVWVWKHIHGHUDOFRXUWV
RI MXULVGLFWLRQ SXUVXDQW WR WKH 7D[ ,QMXQFWLRQ $FW 7,$
$OWHUQDWLYHO\WKHVWDWHFRQWHQGVWKDW$QJHO¶VVXLWDJDLQVWLWLV
EDUUHG E\ WKH (OHYHQWK $PHQGPHQW WR WKH 8QLWHG 6WDWHV
&RQVWLWXWLRQ7KHGLVWULFWFRXUWJUDQWHGWKHVWDWH¶VPRWLRQWR
GLVPLVV$QJHO¶VFRPSODLQWRQWKHEDVLVWKDWWKHFRXUWODFNHG
MXULVGLFWLRQXQGHUWKH7,$$OWKRXJKZHKDYHJUDYHGRXEWV
FRQFHUQLQJWKHDSSOLFDELOLW\RIWKH7,$WRWKHSUHVHQWFDVHZH

-- 2 of 4 --

$QJHOY&RPPRQZHDOWK
RI.HQWXFN\HWDO
1R
E\WKHFRXUWEHORZ6HH:LOVRQ-RQHVY&DYLQHVV)G
WK &LU KROGLQJ WKDW ³VWDWH LPPXQLW\ LV
MXULVGLFWLRQDO LQ WKH VDPH VHQVH DV WKH FRPSOHWH GLYHUVLW\
UHTXLUHPHQW RU WKH ZHOOSOHDGHG FRPSODLQW UXOH >$@
IHGHUDOFRXUWPXVWH[DPLQHHDFKFODLPLQDFDVHWRVHHLIWKH
FRXUW¶VMXULVGLFWLRQLVEDUUHGE\WKH(OHYHQWK$PHQGPHQW´
HPSKDVLVLQRULJLQDOLQWHUQDOFLWDWLRQVDQGTXRWDWLRQPDUNV
RPLWWHG %HFDXVH $QJHO KDV QRW SOHG IDFWV VXIILFLHQW WR
VXUYLYH3RSRYLFK¶VEDUWR(OHYHQWK$PHQGPHQWVXLWVXQGHU
7LWOH,,RIWKH$'$ZHDIILUPWKHGLVWULFWFRXUW¶VGLVPLVVDORQ
WKLVEDVLV
7KHVWDWH¶VVHFRQG(OHYHQWK$PHQGPHQWDUJXPHQWUHODWHV
WR$QJHO¶VIDLOXUHWRQDPHWKHDSSURSULDWHFRXQW\FOHUNZKR
LVVXHGKHUWKHSDUNLQJSODFDUG,WFODLPVWKDWWKHFOHUNLVDQ
LQGLVSHQVDEOH SDUW\ LQ RUGHU WR PHHW WKH ([ SDUWH <RXQJ
H[FHSWLRQWR(OHYHQWK$PHQGPHQWLPPXQLW\DQGWRREWDLQ
SURVSHFWLYHLQMXQFWLYHUHOLHI([SDUWH<RXQJ86
KROGLQJWKDWLQRUGHUWRVXHDQRIILFHURIWKHVWDWHWR
HQMRLQ WKH HQIRUFHPHQW RI DQ DFW DOOHJHG WR EH
XQFRQVWLWXWLRQDO WKH RIILFHU PXVW EH FRQQHFWHG ZLWK WKH
HQIRUFHPHQWRIWKHDFW $QJHOLVRIFRXUVHIUHHWRILOHDQHZ
VXLWDJDLQVWWKHDSSURSULDWHFRXQW\FOHUNIRULQMXQFWLYHUHOLHI
EXW DV WR KHU SUHVHQW VXLW DJDLQVW WKH VWDWH LW PXVW EH
GLVPLVVHGIRUODFNRIVXEMHFWPDWWHUMXULVGLFWLRQ
,,,&21&/86,21
)RU DOO RI WKH UHDVRQV VHW IRUWK DERYH ZH $)),50 WKH
MXGJPHQWRIWKHGLVWULFWFRXUW
1R $QJHOY&RPPRQZHDOWK
RI.HQWXFN\HWDO

QHYHUWKHOHVV$)),50WKHMXGJPHQWRIWKHGLVWULFWFRXUWRQ
WKHEDVLVRIWKHVWDWH¶V(OHYHQWK$PHQGPHQWLPPXQLW\
,%$&.*5281'
$ )DFWXDOEDFNJURXQG
$QJHOXVHVDGLVDEOHGDFFHVVSODFDUGZKHQEHLQJGULYHQWR
SODFHVVKHGHVLUHVWRJR%HFDXVHVKHGRHVQRWRZQDFDURU
KDYHDGULYHU¶VOLFHQVHVKHGHSHQGVRQIULHQGVDQGUHODWLYHV
WRWUDQVSRUWKHU7KHVWDWHFKDUJHVDQHLJKWGROODUIHHIRUD
SODFDUGWKDWLVJRRGIRUVL[\HDUV,WGRHVQRWFKDUJHDQ\IHH
WRLVVXHDVSHFLDOOLFHQVHSODWHIRUGLVDEOHGSHUVRQV%RWKWKH
SODFDUGV DQG WKH OLFHQVH SODWHV DOORZ WKH XVHU WR SDUN LQ
VSHFLDOO\GHVLJQDWHGVSDFHVDQGPDNHLWHDVLHUIRUWKHVWDWHWR
HQIRUFHVWDWXWHVSURKLELWLQJQRQGLVDEOHGSHRSOHIURPXVLQJ
WKHVHVSDFHV
% 3URFHGXUDOEDFNJURXQG
$QJHOILOHGKHUFRPSODLQWDJDLQVWWKH&RPPRQZHDOWKRI
.HQWXFN\ WKH .HQWXFN\ 7UDQVSRUWDWLRQ &DELQHW -DPHV &
&RGHOO ,,, 6HFUHWDU\ RI WKH 7UDQVSRUWDWLRQ &DELQHW WKH
'LYLVLRQ RI 9HKLFOH 5HJLVWUDWLRQ DQG (G /RJVGRQ
&RPPLVVLRQHU RI 9HKLFOH 5HJLVWUDWLRQ 7KH VWDWH ILOHG DQ
DQVZHU DQG D PRWLRQ WR GLVPLVV UDLVLQJ WKUHH DUJXPHQWV
WKDWWKHFKDOOHQJHGIHHZDVLQIDFWDWD[WKXVGHSULYLQJWKH
GLVWULFW FRXUW RI MXULVGLFWLRQ XQGHU WKH 7,$ WKDW WKH
(OHYHQWK $PHQGPHQW EDUUHG MXULVGLFWLRQ RYHU DOO FODLPV
DJDLQVW WKH VWDWH DQG DOO RIILFLDOFDSDFLW\ FODLPV VHHNLQJ
PRQH\GDPDJHVDQG WKDW$QJHOKDGIDLOHGWRQDPHWKH
FRXQW\FOHUNZKRLVVXHGWKHSODFDUGZLWKWKHFOHUNEHLQJD
QHFHVVDU\DQGSURSHUSDUW\LQRUGHUWRREWDLQDQ\SURVSHFWLYH
LQMXQFWLYHUHOLHI
,Q UHVSRQVH WR WKH PRWLRQ WR GLVPLVV $QJHO DUJXHG WKDW
GLVFRYHU\ ZDV QHHGHG LQ RUGHU WR GHWHUPLQH ZKHWKHU WKH
GLVSXWHGDVVHVVPHQWZDVDFWXDOO\DWD[RURQO\DIHHIRUWKH
SXUSRVHVRIWKH7,$7KHSDUWLHVDJUHHGWKDWGLVFRYHU\VKRXOG
EHVWD\HGXQWLOWKHMXULVGLFWLRQDOLVVXHVFRXOGEHGHFLGHG$W

-- 3 of 4 --

$QJHOY&RPPRQZHDOWK
RI.HQWXFN\HWDO
1R
WKLVSRLQWWKHFDVHZDVKHOGLQDEH\DQFHSHQGLQJWKLVFRXUW¶V
GHFLVLRQLQ+HGJHSHWKY7HQQHVVHH)G WK&LU
KROGLQJ WKDW 7HQQHVVHH¶V DVVHVVPHQW IRU SDUNLQJ
SODFDUGVZDVDWD[UDWKHUWKDQDIHHDQGWKXVVXEMHFWWRWKH
7,$ 7KHGLVWULFWFRXUWDIWHU+HGJHSHWKZDVGHFLGHGRUGHUHG
$QJHOWRVKRZFDXVHZK\WKHPRWLRQWRGLVPLVVVKRXOGQRWEH
JUDQWHG
$IWHU FRQVLGHULQJ $QJHO¶V UHVSRQVH WKH GLVWULFW FRXUW
JUDQWHG WKH VWDWH¶V PRWLRQ WR GLVPLVV SXUVXDQW WR 5XOH
E RIWKH)HGHUDO5XOHVRI&LYLO3URFHGXUH7KHFRXUW
FLWLQJ+HGJHSHWKGHWHUPLQHGWKDWLWODFNHGMXULVGLFWLRQXQGHU
WKH7,$EHFDXVHWKHSODFDUGDVVHVVPHQWZDVDWD[,WWKXV
GHFOLQHGWRUHDFKWKH(OHYHQWK$PHQGPHQWLVVXH7KLVWLPHO\
DSSHDOIROORZHG
,,$1$/<6,6
$ 6XEMHFWPDWWHUMXULVGLFWLRQ
6XEMHFW PDWWHU MXULVGLFWLRQ LV GLVSXWHG E\ WKH SDUWLHV
$FFRUGLQJWR$QJHOWKHGLVWULFWFRXUWKDGMXULVGLFWLRQRYHU
WKLV FDVH SXUVXDQW WR 86& † 7KH VWDWH RQ WKH
RWKHUKDQGDUJXHVWKDWWKHGLVWULFWFRXUW¶VMXULVGLFWLRQZDV
EDUUHGE\WKH7,$86&†DQGE\WKH(OHYHQWK
$PHQGPHQW :H KDYH MXULVGLFWLRQ WR UHYLHZ WKH ILQDO
GHFLVLRQRIWKHGLVWULFWFRXUWSXUVXDQWWR86&†
% 6WDQGDUGRIUHYLHZ
$GLVWULFWFRXUW¶VGHFLVLRQWRJUDQWDPRWLRQWRGLVPLVVLV
UHYLHZHGGHQRYR:HLQHUY.ODLV &R)G
WK&LU 8QGHU5XOH E RIWKH)HGHUDO5XOHVRI
&LYLO 3URFHGXUH WKH GLVWULFW FRXUW PXVW DFFHSW DOO RI WKH
DOOHJDWLRQV LQ WKH FRPSODLQW DV WUXH DQG FRQVWUXH WKH
FRPSODLQWOLEHUDOO\LQIDYRURIWKHSODLQWLII0LOOHUY&XUULH
)G WK &LU ³:KHQ WKH GHIHQGDQW
FKDOOHQJHV VXEMHFW PDWWHU MXULVGLFWLRQ WKURXJK D PRWLRQ WR
GLVPLVV WKH SODLQWLII EHDUV WKH EXUGHQ RI HVWDEOLVKLQJ
MXULVGLFWLRQ´+HGJHSHWK)GDW
1R $QJHOY&RPPRQZHDOWK
RI.HQWXFN\HWDO

& 7KH (OHYHQWK $PHQGPHQW EDUV MXULVGLFWLRQ LQ WKLV
PDWWHU
$OWKRXJKZHKDYHJUDYHGRXEWVFRQFHUQLQJWKHFRUUHFWQHVV
RI WKH GLVWULFW FRXUW¶V FRQFOXVLRQ WKDW WKH DVVHVVPHQW IRU
SDUNLQJ SODFDUGV LV D WD[ UDWKHU WKDQ D IHH ZH DUH IUHH WR
DIILUPWKH MXGJPHQWRQDQ\EDVLVVXSSRUWHGE\WKHUHFRUG
7KLV LV HVSHFLDOO\ VR ZKHUH WKH XQGHUO\LQJ IDFWV DUH
XQGLVSXWHG 6HH $EHUFURPELH )LWFK 6WRUHV ,QF Y $P
(DJOH 2XWILWWHUV ,QF )G WK &LU
SRLQWLQJ RXW WKDW ³>E@HFDXVH WKLV FRXUW¶V GH QRYR UHYLHZ
LQYROYHV RQO\ DSSOLFDWLRQ RI OHJDO SURSRVLWLRQV WR WKH
XQGLVSXWHGIDFWVLQWKHUHFRUGZHPD\DIILUPRQDQ\JURXQGV
VXSSRUWHGE\WKHUHFRUGHYHQLIGLIIHUHQWIURPWKHUHDVRQVRI
WKHGLVWULFWFRXUW´
7KH VWDWH KDV FRQVLVWHQWO\ FRQWHQGHG WKDW WKH (OHYHQWK
$PHQGPHQWSURYLGHVDMXULVGLFWLRQDOEDUWR$QJHO¶VVXLW,W
EDVHVWKLVDUJXPHQWRQWZRSRLQWV)LUVWLWDUJXHVWKDWWKLV
FRXUW¶VGHFLVLRQLQ3RSRYLFKY&X\DKRJD&RXQW\&RXUWRI
&RPPRQ3OHDV)G WK&LU KROGLQJ
WKDW&RQJUHVVGLGQRWSURSHUO\DEURJDWH(OHYHQWK$PHQGPHQW
LPPXQLW\LQHTXDOSURWHFWLRQFODLPVEURXJKWXQGHU7LWOH,,RI
WKH $'$ EXW GLG SURSHUO\ GR VR LQ GXH SURFHVV FODLPV
EURXJKWXQGHUWKDWSURYLVLRQ EDUV$QJHO¶VHTXDOSURWHFWLRQ
W\SHFODLPXQGHU7LWOH,,RIWKH$'$3RSRYLFKZDVGHFLGHG
DIWHUWKHGLVWULFWFRXUW¶VGLVPLVVDORIWKLVFDVH6HFRQGWKH
VWDWHDUJXHVWKDW$QJHOGLGQRWVXHWKHDSSURSULDWHRIILFLDOLQ
RUGHUWRREWDLQSURVSHFWLYHLQMXQFWLYHUHOLHI
%HFDXVHWKHGLVWULFWFRXUWGLVPLVVHGWKHFRPSODLQWRQWKH
EDVLVRIWKH7,$WKHUHLVQR(OHYHQWK$PHQGPHQWDQDO\VLVLQ
WKH GLVWULFW FRXUW¶V RSLQLRQ $QJHO KDV WKHUHIRUH KDG QR
RSSRUWXQLW\WRDGGUHVVWKLVLVVXHLQKHUEULHI$IDLUUHDGLQJ
RIWKHFRPSODLQWKRZHYHUHVWDEOLVKHVWKDWQRGXHSURFHVV
DUJXPHQWLVDOOHJHG7KDWEHLQJWUXHWKHUHLVQRZD\WKDW
$QJHO¶VDFWLRQDJDLQVWWKHVWDWHFDQEHVXFFHVVIXOLQOLJKWRI
3RSRYLFK :H PXVW WKHUHIRUH DGGUHVV WKH MXULVGLFWLRQDO
TXHVWLRQWKDWFOHDUO\H[LVWVHYHQWKRXJKLWZDVQRWDGGUHVVHG

-- 4 of 4 --