In the Shadow of Vesuvius: A Cultural History of Naples

, 1 7 + ( 6 + $'2: 2 ) 9 ( 6 8 9,86 $LPLHLFDULJHQLWRUL« ,17+(6+ $ ' 2 : 2)9(689 , 8 6 $ & X O W X ...

Author: Jordan Lancaster

220 downloads 1425 Views 1MB Size Report

This content was uploaded by our users and we assume good faith they have the permission to share this book. If you own the copyright to this book and it is wrongfully on our website, we offer a simple DMCA procedure to remove your content from our site. Start by pressing the button below!

Report copyright / DMCA form

DOWNLOAD PDF

, 1 7 + ( 6 + $'2: 2 ) 9 ( 6 8 9,86

$LPLHLFDULJHQLWRUL«

,17+(6+ $ ' 2 : 2)9(689 , 8 6

$ & X O W X UDO+LVWRU\ R I 1 D S O HV -25'$1/$1&$67(5

3XEOLVKHGLQE\,%7DXULV &R/WG 6DOHP5RDG/RQGRQ:%8 )LIWK$YHQXH1HZ
$IXOO&,3UHFRUGIRUWKLVERRNLVDYDLODEOHIURPWKH%ULWLVK/LEUDU\ $IXOO&,3UHFRUGIRUWKLVERRNLVDYDLODEOHIURPWKH/LEUDU\RI&RQJUHVV /LEUDU\RI&RQJUHVVFDWDORJFDUGDYDLODEOH 7\SHVHWLQ3HUSHWXDE\6WHYH7ULEH$QGRYHU 3ULQWHGDQGERXQGLQ*UHDW%ULWDLQE\03*%RRNV/WG%RGPLQ

& 2 1 7 ( 1 76

3UHIDFH

YLL

0DSV

[L

,QWURGXFWLRQ,QWKH6KDGRZRI9HVXYLXV

&KDSWHU2QH$QFLHQW1DSOHV

&KDSWHU7ZR0HGLHYDO1DSOHV

&KDSWHU7KUHH6SDQLVK1DSOHV

&KDSWHU)RXU%RXUERQ1DSOHV

&KDSWHU)LYH,WDOLDQ1DSOHV

$SSHQGL[,1HDSROLWDQ0RQDUFKV

$SSHQGL[,,/D6PRUILD1DSROHWDQD

1HDSROLWDQ+LVWRU\$Q(VVHQWLDO%LEOLRJUDSK\

,QGH[

7KHPLUDFOHRI6DQ*HQQDUR

3 5 ( ) $ &(

:K\LVLWWKDWWKLVVXEOLPH1HDSROLWDQKLVWRU\«LVQRWJHQHUDOO\ NQRZQDQGLQGHHGLVJHQHUDOO\XQNQRZQDQGGHQLHG" %HQHGHWWR&URFH+LVWRU\RIWKH.LQJGRPRI1DSOHV

7

KHIDoDGHRIWKH5R\DO3DODFHLQ1DSOHVLVGHFRUDWHGZLWKQLFKHV FRQWDLQLQJODUJHUWKDQOLIHVWDWXHVRIWKHFLW\·VJUHDWNLQJV)URP OHIWWRULJKWVWDQG5RJHUWKH1RUPDQ)UHGHULFNWKH*UHDW&KDUOHV ,RI$QMRX$OSKRQVH,RI$UDJRQ&KDUOHV9RI+DEVEXUJ&KDUOHV ,,, RI %RXUERQ -RDFKLP 0XUDW DQG9LFWRU (PDQXHO ,, RI 6DYR\ *LYHQWKHFRPSOH[LW\RIWKHQXPHURXVG\QDVWLFDOFKDQJHVWKHFLW\ KDVOLYHGWKURXJKLWFDQEHDPRVWDUGXRXVWDVNIRUWKHRXWVLGHUWR JUDVSHYHQWKHEDVLFRXWOLQHRIWKHFLW\·VKLVWRU\)RUPDQ\FHQWXULHV 1DSOHVZDVRQHRI(XURSH·VJUHDWFDSLWDOVXQWLOWKHXQLILFDWLRQRI ,WDO\LQGRZQJUDGHGLWWROLWWOHPRUHWKDQDSURYLQFLDOWRZQ 7KHIROORZLQJ\HDUVZHUHQRWNLQGWRWKHFLW\DQGDJUHDWGHEWRI DSSUHFLDWLRQLVRZHGWRWKRVHZKRKDYHZRUNHGVRKDUGWRDFKLHYH WKHFXOWXUDO5HQDLVVDQFHWKHFLW\KDVXQGHUJRQHPRVWSDUWLFXODUO\ LQWKHODVWGHFDGH1DSOHVKDVVLQFHDFKLHYHGZLGHVSUHDGUHFRJQLWLRQ IRULWVRXWVWDQGLQJKHULWDJHFXOWXUHDQGWUDGLWLRQVQRWWRPHQWLRQ

YLLL

,17+(6+$'2:2)9(689,86

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·V JUHDWFLWLHVWKHUH LV D VHULRXV ODFN RI PDWHULDO DYDLODEOH LQ (QJOLVK IRUDQ\RQHZDQWLQJWRORRNEH\RQGJHQHUDOWRXULVWJXLGHVLQRUGHU WRXQGHUVWDQGWKHFLW\LWVKLVWRU\DQGLWVFXOWXUH1DSOHVKDVEHHQ GHVFULEHGDV¶DSDUDGLVHLQKDELWHGE\GHYLOV·0RVWZRXOGDJUHHZLWK WKLVVHQWLPHQWDWFHUWDLQFULWLFDOPRPHQWVRIWKHLUUHODWLRQVKLSZLWK WKHFLW\
35()$&(

L[

WR WKRVH ,WDORSKLOHV DQG DUPFKDLU WUDYHOOHUV ZKR ZLVK WR OHDUQ PRUHDERXWLWVIDVFLQDWLQJFXOWXUDOKLVWRU\,ZRXOGDOVROLNHWRRIIHU WKLVZRUNWRDFDGHPLFVZKRDUHEHJLQQLQJWKHLUUHVHDUFKLQWRWKH KLVWRU\RI1DSOHV,KRSHWKDW,FDQJLYHWKHPDVWDUWLQJSRLQWZKLFK ZLOO DOORZ WKHP D GHHSHU XQGHUVWDQGLQJ RI WKH YHU\ GHWDLOHG DQG VSHFLDOLVHGZULWLQJVRQ,WDOLDQKLVWRU\E\RXWVWDQGLQJVFKRODUVVXFK DV&URFHKLPVHOI*LXVHSSH*DODVVR5RVDULR9LOODUL&DUORGH)UHGH DQGRWKHUV)LQDOO\,KRSHWKDWWKLVERRNZLOOEHDVRXUFHRISULGHWR WKHPDQ\ILQHSHRSOHZRUOGZLGHZKRWUDFHWKHLUIDPLO\KLVWRU\EDFN WRWKH.LQJGRPRI1DSOHV ,ILUVWZDVDWWUDFWHGWRWKHFLW\DVD\RXQJJUDGXDWHVWXGHQWDWWKH 8QLYHUVLW\RI7RURQWRLQWKHODWHVZKHQ,FKRVHWRIRFXVP\ GLVVHUWDWLRQUHVHDUFKRQWKH1HDSROLWDQHQOLJKWHQPHQWLQSDUWLFXODU WKHZULWLQJVRI*LDPEDWWLVWD9LFRDQG3LHWUR*LDQQRQH,DPJUDWHIXO WR3URIHVVRU'RPHQLFR3LHWURSDRORIRUHQFRXUDJLQJP\VWXGLHVLQ WKLV GLUHFWLRQ$ IHZ \HDUV ODWHU WKDQNV WR D JHQHURXV VFKRODUVKLS IURPWKH,WDOLDQ0LQLVWU\RI)RUHLJQ$IIDLUV,KDGWKHJRRGIRUWXQH WREHDEOHWRVWXG\WKHZULWLQJVRIWKHVHDXWKRUVXQGHUWKHWKRXJKWIXO JXLGDQFHRI3URIHVVRU$QGUHD%DWWLVWLQLRIWKH8QLYHUVLW\RI%RORJQD ,WZDVDVDVWXGHQWLQ%RORJQDWKDW,ILUVWEHJDQWUDYHOOLQJWR1DSOHV WR YLVLW WKH FLW\ DQG FRQVXOW ORFDO OLEUDULHV DQG DUFKLYHV ,Q WKH VSULQJRI,RUJDQLVHGDVHPLQDURQ¶9LHZVRI1DSOHV·DWWKH 8QLYHUVLW\RI&DOJDU\LQ&DQDGDZKHUH,ZDVYLVLWLQJSURIHVVRURI ,WDOLDQ,DPIRUWXQDWHHQRXJKWRKDYHUHFHLYHGWKHVXSSRUWRIRQH RIWKHSDUWLFLSDQWV0LFKDHO'HZDURIWKH'HSDUWPHQWRI&ODVVLFVRI WKH8QLYHUVLW\RI7RURQWRWRDVVLVWPHLQWKHSUHSDUDWLRQRIVRPH DVSHFWV RI WKH ILUVW FKDSWHU RI WKLV ERRN7KH VHPLQDU WRSLF ZDV LQWULJXLQJDQGDVZHVSHQWDGD\GLVFXVVLQJWKHFRQWULEXWLRQVRIVR PDQ\IRUHLJQHUVDQG1HDSROLWDQVLQIOXHQFHGE\WKHVLUHQFLW\,NQHZ ,KDGWRUHWXUQWR1DSOHVDQGH[SHULHQFHWKHFLW\ILUVWKDQGIRUDQ H[WHQGHGSHULRG

[

,17+(6+$'2:2)9(689,86

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

,1752'8&7,21

, 1 7 + ( 6 + $'2: 2 ) 9 ( 6 8 9,86

7

KHFLW\RI1DSOHVOLHVLQWKHVKDGRZRIWKHVPRXOGHULQJWKUHDW RI9HVXYLXVLWLVRQHRIWKHZRUOG·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·VFRQHLVMXVWO\UHQRZQHGRYHUORRNLQJWKHKLOOVRI6DQ 0DUWLQRDQG3L]]RIDOFRQHWRZDUGVWKHLPSRVLQJPLJKWRI9HVXYLXV 2YHUVKDGRZLQJ WKH EHDXWLIXO %D\ WKH YROFDQR RFFDVLRQDOO\ HPLWV DQRPLQRXVSXIIRIVPRNH,WVVORSHVWKHVLWHRI%DFFKXV·RUJLDVWLF ULWHVDUHH[FLWLQJDQGGDQJHURXVDWWUDFWLYHDQGUHSXOVLYH,URQLFDOO\

,17+(6+$'2:2)9(689,86

WKHODYDVRLOLVLQFUHGLEO\IHUWLOH%\LWVLQIOXHQFHRYHUWKHLQKDELWDQWV RI WKLV H[WUDRUGLQDU\ PHWURSROLV 9HVXYLXV IRVWHUV WKHLU XQLTXH WHPSHUDPHQWDQGGLVSRVLWLRQ ¶6HH1DSOHVDQGGLH·7KHEHDXW\RIWKHQDWXUDOORFDWLRQVHGXFHV DQGWKHQGHVWUR\V7KHFHOHEUDWHGSURYHUEPD\UHIHUTXLWHVLPSO\WR WKHKHDUWVWRSSLQJEHDXW\RIWKHFLW\DQGLWVED\WREHH[SHULHQFHG DWOHDVWRQFHLQDOLIHWLPHRULWFRXOGUHIHUWRWKHGDQJHUVRIFHUWDLQ LQIDPRXVQHLJKERXUKRRGVVXFKDVWKH4XDUWLHULVSDJQROLRU6SDQLVK 4XDUWHUV FRQVLGHUHG VWULFWO\ RII OLPLWV WR DOO EXW WKH VDYYLHVW RI ORFDOV ,Q WKH RULJLQDO ,WDOLDQ WKH H[SUHVVLRQ LV 9HGL 1DSROL H SRL PXRULZKLFKFDQEHWUDQVODWHGDV¶6HH1DSOHV WKHQGLH·:LWKGXH SDWULRWLFSULGHRQO\WKHSRVLWLYHQXDQFHVDUHUHWDLQHG7KHFLW\DW RQFHFKDUPVDQGH[DVSHUDWHVERWKUHVLGHQWVDQGYLVLWRUVDOLNH/LNH WKH WZLQ PDVNV RI WUDJHG\ DQG FRPHG\ 1DSOHV FRQVWDQWO\ VKLIWV EHWZHHQVSOHQGRXUDQGPLVHU\EHDXW\DQGVTXDORU+LVWRULDQ&DUOR 'H )UHGH GHGLFDWHV KLV ERRN RI PHPRLUV /HVVLFR 1DSROHWDQR WR ¶1DSROLFLWWjRGLRVDPDWD·WKHFLW\ERWKGHWHVWHGDQGDGRUHG0DQ\ KDYHHFKRHGKLVVHQWLPHQWV 9HVXYLXVILUVWJDLQHGQRWRULHW\ZLWKWKHJUHDWFDWDVWURSKHRI $' ZKLFKEXULHGWKHWRZQVRI+HUFXODQHXPDQG3RPSHLL3OLQ\WKH
,17+(6+$'2:2)9(689,86

ZDVERUQHGRZQE\LWVRZQZHLJKWVRWKDWLWVSUHDGRXWDQGGLVSHUVHG ,Q SODFHV LW ORRNHG ZKLWH HOVHZKHUH EORWFKHG DQG GLUW\ DFFRUGLQJ WRWKHDPRXQWRIVRLODQGDVKHVLWFDUULHG«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«6RRQDIWHUWKHFORXGEHJDQWRGHVFHQGXSRQWKHHDUWK DQGFRYHUWKHVHD,WKDGDOUHDG\VXUURXQGHGDQGREVFXUHG&DSULDQG EORWWHGRXW&DSH0LVHQXP«ZHZHUHHQYHORSHGLQQLJKW²QRWD PRRQOHVVQLJKWRURQHGLPPHGE\FORXGEXWWKHGDUNQHVVRIDVHDOHG URRPZLWKRXWOLJKWV2QHFRXOGKHDURQO\WKHVKULOOFULHVRIZRPHQ WKH ZDLOLQJ RI FKLOGUHQ WKH VKRXWLQJ RI PHQ 6RPH ZHUH FDOOLQJ WR WKHLUSDUHQWVRWKHUVWRWKHLUFKLOGUHQRWKHUVWRWKHLUZLYHV²NQRZLQJ RQHDQRWKHURQO\E\YRLFH6RPHZHSWIRUWKHPVHOYHVRWKHUVIRUWKHLU UHODWLRQV7KHUHZHUHWKRVHZKRLQWKHLUYHU\IHDURIGHDWKLQYRNHG LW0DQ\OLIWHGXSWKHLUKDQGVWRWKHJRGVEXWDJUHDWQXPEHUEHOLHYHG WKHUHZHUHQRJRGVDQGWKDWWKLVZDVWREHWKHZRUOG·VODVWHWHUQDO QLJKW «$ FXULRXV EULJKWQHVV UHYHDOHG LWVHOI WR XV QRW DV GD\OLJKW EXWDVDSSURDFKLQJILUHEXWLWVWRSSHGVRPHGLVWDQFHIURPXV2QFH PRUHGDUNQHVVDQGDVKHVWKLFNDQGKHDY\)URPWLPHWRWLPHZHKDG WRJHWXSDQGVKDNHWKHPRIIIRUIHDURIEHLQJDFWXDOO\EXULHGXQGHU WKHLUZHLJKW,FDQERDVWWKDWLQVRJUHDWDGDQJHU,GLGQRWXWWHUD VLQJOHZRUGRUDVLQJOHODPHQWDWLRQWKDWFRXOGKDYHEHHQFRQVWUXHGDV ZHDNQHVV,EHOLHYHGWKDWRQHDQGDOORIXVZRXOGSHULVK²DZUHWFKHG

,17+(6+$'2:2)9(689,86

EXWVWURQJFRQVRODWLRQLQP\G\LQJ%XWWKHGDUNQHVVOLJKWHQHGDQG WKHQ OLNH VPRNH RU FORXG GLVVROYHG DZD\ )LQDOO\ D JHQXLQH GD\OLJKW FDPHWKHVXQVKRQHEXWSDOOLGO\DVLQDQHFOLSVH$QGWKHQEHIRUH RXUWHUURUVWULFNHQJD]HHYHU\WKLQJDSSHDUHGFKDQJHG²FRYHUHGE\D WKLFNOD\HURIDVKHVOLNHDQDEXQGDQWVQRZIDOO

)ROORZLQJWKHFROODSVHRIWKHYROFDQLFFRQHDIORRGRIODYDDQG PDJPD ZDV UHOHDVHG UDSLGO\ VXEPHUJLQJ WKH VXUURXQGLQJ KLOOV 9HVXYLXVKDVHUXSWHGRQDODUJHVFDOHDERXWWKUHHGR]HQWLPHVVLQFH EXWWKHGLVDVWHURI $'FODLPLQJRYHUYLFWLPVZDVE\IDU WKHPRVWVHYHUH 1RW XQOLNH FRPHWV HFOLSVHV RU RWKHU JHRSK\VLFDO SKHQRPHQD YROFDQRHVKDYHORQJEHHQDVRXUFHRIKXPDQIDVFLQDWLRQ9HVXYLXV LV WKH PRVW HPLQHQW DQG PRVW GDQJHURXV YROFDQR LQ FRQWLQHQWDO (XURSH7KH1HDSROLWDQYROFDQLFUHJLRQZDVIRUPHGDSSUR[LPDWHO\ \HDUVDJR:LWKLQWKLVDUHDD¶VWUDWRYROFDQR·NQRZQDV0W 6RPPDFROODSVHG\HDUVDJRDQG9HVXYLXVLVDOOWKDWUHPDLQV ,W LV NQRZQ WHFKQLFDOO\ DV D¶FRPSOH[ YROFDQR· EHFDXVH LW LV RQH RIDVHULHVRIUHODWHGPDMRUDQGPLQRUYROFDQLFFHQWUHVVWUHWFKLQJ WRWKH3KOHJUHDQ)LHOGV¶ILHOGVRIILUH· QRUWKRIWKHFLW\DQGWKH VXOSKXURXVVROIDWDUDQHDU&XPDHQFRPSDVVLQJWKHYROFDQLFLVODQGV RI3URFLGD,VFKLDDQG1LVLGD,WLVDOVRFODVVLILHGDVD¶UHGYROFDQR· EHFDXVHLWVSHZVIRUWKOLTXLGIURPLWVFUDWHUDOPRVWFRQWLQXRXVO\ 7KLV DFWLYLW\ LV SUHGLFWDEOH FRQWUROODEOH DQG OHVV GDQJHURXV WKDQ WKHWR[LFJDVFORXGRIWKHJUH\YROFDQREHFDXVHPRUHYLFWLPVGLH IURP EUHDWKLQJ WR[LF DLU WKDQ IURP EXUQLQJ ODYD ZKLFK PRYHV FRPSDUDWLYHO\ VORZO\ 1RQHWKHOHVV9HVXYLXV LV RQH RI D VSHFLDO FDWHJRU\RIYROFDQRHVFRQVLGHUHGGHDGO\EHFDXVHRIWKHKHDY\ORVV RIOLIHWKH\KDYHFDXVHG 7KH YROFDQR·V EURRGLQJ SUHVHQFH LV D FRQVWDQW IHDWXUH LQ 1HDSROLWDQ OLIH )RU FHQWXULHV WKH FLWL]HQV RI 1DSOHV KDYH VRXJKW UHDVVXUDQFHLQWKHIDFHRILPPLQHQWFDWDVWURSKHIURPWKHSURWHFWLRQ

,17+(6+$'2:2)9(689,86

RI WKHLU PXFKORYHG SDWURQ 6DLQW -DQXDULXV RU 6DQ *HQQDUR DV WKH\ NQRZ KLP7KH FXOW RI WKH FLW\·V SDWURQ VDLQW LV LQH[WULFDEO\ OLQNHGWRWKHYROFDQRDQGWKHULWXDOPLUDFOHRI6DQ*HQQDURPD\ EH DVVRFLDWHG ZLWK WKH SULPLWLYH ULWHV RI D SUH&KULVWLDQ YROFDQLF FXOW%RUQLQWKHFLW\WRZDUGVWKHVHFRQGKDOIRIWKHWKLUGFHQWXU\ *HQQDUR WRRN KRO\ RUGHUV DQG HYHQWXDOO\ URVH WR SURPLQHQFH DV ELVKRSRIQHDUE\%HQHYHQWR:KHQWKH(PSHURU'LRFOHWLDQVLJQHG DQ HGLFW DXWKRULVLQJ SHUVHFXWLRQ RI &KULVWLDQV *HQQDUR ULVNHG KLV OLIH E\ WDNLQJ FRPPXQLRQ WR DQ LPSULVRQHG GHDFRQ +H ZDV GLVFRYHUHGFRQGHPQHGWRGHDWKDQGGHFDSLWDWHGLQ3R]]XROLRQ 6HSWHPEHU$'QHDUWKHVSLWWLQJJH\VHUVRIWKHYROFDQLFVROIDWDUD *HQQDUR·VEORRGZDVFROOHFWHGE\DSLRXV&KULVWLDQODG\(XVHELD LQWZRDPSRXOHVDQGKLVERG\ZDVWDNHQIRUEXULDOQHDUE\6RPH \HDUV ODWHU ZKHQ WKH (PSHURU &RQVWDQWLQH FRQFHGHG UHOLJLRXV IUHHGRPWR&KULVWLDQVWKHUHPDLQVRIWKHVDLQWZHUHWDNHQLQVROHPQ SURFHVVLRQWREHODLGLQKLVIDPLO\WRPE$VWKHSURFHVVLRQSDVVHG (XVHELDVWHSSHGRXWRIWKHFURZGDQGSUHVHQWHGKHUDPSRXOHVWR WKHDVVHPEOHGGLJQLWDULHV $WWKLVYHU\PRPHQW9HVXYLXVHUXSWHGLQVSHFWDFXODUFHOHEUDWLRQ DQG WKH PLUDFXORXV OLTXHIDFWLRQ RI WKH VDLQW·V EORRG RFFXUUHG IRU WKHILUVWWLPH(XVHELD·VDPSRXOHVDUHQRZNHSWLQDFKDSHORIWKH FDWKHGUDO LQ 1DSOHV +HUH WKH SRSXODFH DQG YDULRXV GLJQLWDULHV IHUYHQWO\SUD\WRJHWKHUEHIRUHWKHDPSRXOHVXQWLOWKHDQWLFLSDWHG PLUDFOH RFFXUV LQ 0D\ DQG 'HFHPEHU DQG RQ WKH IHDVW RI 6DQ *HQQDUR RQ 6HSWHPEHU DQG WKH GULHG EORRG OLTXHILHV PRUH RUOHVVDFFRUGLQJWRVFKHGXOH6RFDOOHG¶UHODWLYHVRI6DQ*HQQDUR· WKURZP\VWLFDOILWVVSHDNLQJLQWRQJXHVDQGKXUOLQJLQVXOWVDWWKHLU DQFHVWRULQDELGWRHQFRXUDJHKLPWRSHUIRUPWKHPLUDFOH7KHYLJLO FDQODVWIRUVHYHUDOKRXUVEXWZKHQLWWDNHVORQJHUWKDQXVXDOLWLV WKRXJKWWREHDEDGRPHQIRUWKHFLW\7KHPLUDFOHQHYHUVFLHQWLILFDOO\ H[SODLQHGKDVEHHQRFFXUULQJUHJXODUO\IRUFHQWXULHVHFKRLQJ

,17+(6+$'2:2)9(689,86

ERWKWKHIORZLQJODYDRIWKHYROFDQRDQGWKHPLUDFOHRI(XFKDULVWLF WUDQVXEVWDQWLDWLRQ:KHQOLTXHIDFWLRQDWODVWRFFXUVWKHDPSRXOHV DUH FDUULHG LQ SURFHVVLRQ WKURXJK WKH VWUHHWV RI WKH ROG WRZQ WRJHWKHUZLWKDQRUQDWHJROGHQHIILJ\RIWKHVDLQWDFFRPSDQLHGE\ FLYLFDQGHFFOHVLDVWLFDOGLJQLWDULHVDQGWKURQJVRIWKHIDLWKIXOWRWKH &KXUFKRI6DLQW&ODUH6DLQW*HQQDUR·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·V SURWHFWLRQ GXULQJ YDULRXV HUXSWLRQV DQG HDUWKTXDNHV7KH V\PELRWLFUHODWLRQVKLSEHWZHHQWKHFLW\DQGWKHVDLQWZDVXQGHUVWRRG E\$OH[DQGUH'XPDVSqUHZKRREVHUYHG 6DQ*HQQDURLVDFLWL]HQDERYHDOOHOVH+HORYHVQRWKLQJPRUHWKDQKLV FLW\KHSURWHFWVLWDJDLQVWHYHU\GDQJHUDQGVHHNVUHYHQJHRQWKHFLW\·V HQHPLHV«,IWKHHQWLUHZRUOGZHUHWKUHDWHQHGE\DVHFRQGIORRG6DQ *HQQDURZRXOGQRWHYHQOLIWKLVOLWWOHILQJHUWRVWRSLWEXWLIWKHVOLJKWHVW GURSRIZDWHUZHUHWRKDUPWKHFURSVRIKLVEHDXWLIXOFLW\6DQ*HQQDUR ZRXOGPRYHKHDYHQDQGHDUWKWREULQJEDFNJRRGZHDWKHU

,IWKHIODPHVRI9HVXYLXVDUHGXHSXQLVKPHQWIRUKXPDQVLQ6DQ *HQQDUR UHSUHVHQWV WKH &KULVWLDQ ILJKW DJDLQVW HYLO 'XULQJ WKH SURFHVVLRQRIWKHDPSRXOHVIURPWKHLUVDQFWXDU\LQWKHFDWKHGUDO WKURXJK WKH QDUURZ VWUHHWV RI WKH KLVWRULF FHQWUH VLQQHUV XVHG WR IROORZ EHKLQG WKH FOHULFV EHJJLQJ IRU WKH VDLQW·V LQWHUFHVVLRQ 7KH\ZRXOGZHDUVDFNFORWKDQGDVKHVDQGIODJHOODWHWKHPVHOYHVDV

,17+(6+$'2:2)9(689,86

DPDUNRIKXPLOLDWLRQZKLOHWKH\EHJJHGIRUWKHVDLQW·VDEVROXWLRQ )ROORZLQJWKHFHUHPRQ\PHQXQDEOHWRJLYHXSWKH¶SOHDVXUHVRIWKH IOHVK·ZRXOGPDUU\WKHSURVWLWXWHVWKH\KDGIUHTXHQWHG7KHFXOWKDV EHHQWUDQVSRUWHGDVIDUDV1HZ

,17+(6+$'2:2)9(689,86

,QWKHVDLQWUHFHLYHGDIXUWKHUEORZWRKLVUHSXWDWLRQZKHQD &DWKROLFDFDGHPLF3URIHVVRU(QQLR0RVFDUHOODGHPRQVWUDWHGWKDW WKH SLHWUD GL 3R]]XROL WKH PDUEOH VWRQH RQ ZKLFK 6DQ *HQQDUR LV WKRXJKWWRKDYHEHHQPDUW\UHGGDWHGIURPDWOHDVWWZRFHQWXULHV DIWHUWKHVDLQW·VGHDWK$SULHVWZKRZLWQHVVHGWKHH[SHULPHQWVLV VDLG WR KDYH EURNHQ GRZQ LQ WHDUV DV WKH UHVXOWV HPHUJHG:KDW KDG SUHYLRXVO\ EHHQ YHQHUDWHG DV EORRGVWDLQV RQ WKH PDUEOH VODE ZHUH GHFODUHG WR EH QRWKLQJ PRUH WKDQ WKH SDLQWHG UHVLGXH RI DQFLHQWGHFRUDWLRQV7KHFLWL]HQVRI1DSOHVQHHGWKHDVVLVWDQFHRI 6DQ *HQQDUR QRZ PRUH WKDQ HYHU9HVXYLXV ORQJ RYHUGXH IRU D PDMRU HUXSWLRQ FRXOG H[SORGH DW DQ\ WLPH %XW DIWHU KLV UHFHQW WULEXODWLRQVZLOO6DQ*HQQDUREHDEOHWRKHOSWKHP"

&+$37(521(

$ 1 & , ( 1 7 1 $3/(6

0\WKLFDO1DSOHV

7

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·VGLVWUDXJKWPRWKHUORRNHG HYHU\ZKHUH IRU KHU EHDXWLIXO \RXQJ GDXJKWHU HYHQ WUDQVIRUPLQJ WKH VLUHQ VLVWHUV LQWR ELUGV VR WKDW WKH\ PLJKW IO\ RYHU ODQG DQG ZDWHU LQ WKHLU VHDUFK7R KHOS WKH VLUHQV ILQG WKHLU ZD\ 'HPHWHU FUHDWHGOLJKWVRXUFHVRQWKHPRXQWDLQVDQGLQWKHVHDZKLFKVXUYLYH WRGD\DVWKH YROFDQRHV RI 6RXWKHUQ ,WDO\ (WQD 6WURPEROL ,VFKLD

,17+(6+$'2:2)9(689,86

WKH 3KOHJUHDQ )LHOGV7KH ODUJHVW YROFDQR9HVXYLXV ZDV FUHDWHG WRLOOXPLQDWH&DPSDQLD)LQDOO\WKHVHDUFKHQGHGZKHQ'HPHWHU OHDUQHGWKDW3OXWRKDGPDUULHGKHUGDXJKWHUDQG3HUVHSKRQHZDV QRZ WKH TXHHQ RI +DGHV )DFHG ZLWK WKLV VLWXDWLRQ WKH JRGGHVV QHJRWLDWHGDQDJUHHPHQWZLWK3OXWRWKDW3HUVHSKRQHZRXOGVSHQG KDOIWKH\HDUZLWKHDFKRIWKHP+HUDUULYDODWKHUPRWKHU·VKRPHLQ &DPSDQLDDOZD\VKHUDOGHGWKHDGYHQWRIVSULQJ 3HUVHSKRQH·V FKLOGKRRG IULHQGV WKH VLUHQ VLVWHUV ZHUH WKH GDXJKWHUV RI 0HOSRPHQH WKH PXVH RI WUDJHG\7KH\ DUH RIWHQ GHSLFWHGDVEHDXWLIXOFUHDWXUHVKDOIZRPDQDQGKDOIELUG$IUHVFR E\$QQLEDOH&DUDFFLLQ5RPH·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¶QHDSROLWDQ· DQG ¶SDUWKHQRSHDQ· FDQ EH XVHG LQWHUFKDQJHDEO\ ,Q%RRN;,,RI+RPHU·V 2G\VVH\WKHZLWFK&LUFHZDUQHG8O\VVHV DERXWWKHVLUHQV·PXVLFDQGRIIHUHGKLPVRPHDGYLFHWRUHVLVWWKHLU DOOXUH ,Q RUGHU WR HVFDSH VHGXFWLRQ KH LQVWUXFWHG KLV VDLORUV WR EORFNWKHLUHDUVZLWKZD[VRDVQRWWREHHQFKDQWHGE\WKHVLUHQV·

$1&,(171$3/(6

VRQJV 8O\VVHV WKHQ KDG KLV PHQ ODVK KLP WR WKH VKLS·V PDVW VR WKDWKHPLJKWKHDUWKHPXVLFZKLOVWSK\VLFDOO\UHVWUDLQHGIURPWKH WHPSWDWLRQWRVXFFXPEWR3DUWKHQRSHDQGKHUVLVWHUV$VWKHURV\ ILQJHUHGGDZQEURXJKWILUVWOLJKW8O\VVHVDQGKLVPHQSUHSDUHGWR VHW VDLO7KH FUHZ WXUQHG WKH VHD ZKLWH ZLWK WKH IRDP JHQHUDWHG E\WKHLUKHDUW\URZLQJDV8O\VVHVOLVWHQHGLQUDSWXUHWRWKHVLUHQV· YRLFHV$Q DXVSLFLRXV ZLQG VHQW E\ &LUFH FDUULHG 8O\VVHV DQG KLV PHQWRZDUGVWKHLVODQGRIWKHVLUHQVDQGDVXGGHQFDOPLQJRIWKHVHD KHLJKWHQHGWKHGUDPDRILPPLQHQWGDQJHU :KHQZHZHUHDVIDUGLVWDQWDVDPDQFDQPDNHKLPVHOIKHDUGZKHQ KH VKRXWV GULYLQJ VZLIWO\ RQ RXU ZD\ WKH 6LUHQV IDLOHG QRW WR QRWH WKHVZLIWVKLSDVLWGUHZQHDUDQGWKH\UDLVHGWKHLUFOHDUWRQHGVRQJ ¶&RPHKLWKHUDVWKRXIDLUHVWUHQRZQHG2G\VVHXVJUHDWJORU\RIWKH $FKDHDQVVWD\WK\VKLSWKDWWKRXPD\HVWOLVWHQ«)RUQHYHU\HWKDV DQ\PDQURZHGSDVWWKLVLVOHLQKLVEODFNVKLSXQWLOKHKDVKHDUGWKH VZHHWYRLFHIURPRXUOLSV1D\KHKDVMR\RILWDQGJRHVKLVZD\D ZLVHUPDQ)RUZHNQRZDOOWKHWRLOVWKDWLQZLGH7UR\WKH$UJLYHVDQG 7URMDQVHQGXUHGWKURXJKWKHZLOORIWKHJRGVDQGZHNQRZDOOWKLQJV WKDWFRPHWRSDVVXSRQWKHIUXLWIXOHDUWK·

8O\VVHVZLWKVWRRGWKHLUVHGXFWLYHDGYDQFHVKLVVKLSVDLOHGRQDQG WKHVSHOOZDVEURNHQ3DUWKHQRSHZDVVRGHYDVWDWHGWKDWVKHWKUHZ KHUVHOILQWRWKHVHDDQGGURZQHG+HUOLIHOHVVERG\ZDVKHGXSRQ WKHURFNVRIWKHLVODQGRI0HJDULGHRQWKH%D\RI1DSOHVZKHUHWKH HDUOLHVW*UHHNFRORQLVWVGLVFRYHUHGKHUFRUSVHDQGDUUDQJHGIRUD UHYHUHQWEXULDORQ3L]]RIDOFRQHKLOO *UHHN1DSOH V

7UDGH DQG VKLSSLQJ KDYH DOZD\V IRUPHG WKH FRUQHUVWRQHV RI WKH *UHHN HFRQRP\ $ WKRXVDQG \HDUV EHIRUH WKH ELUWK RI &KULVW WKH 0HGLWHUUDQHDQ EDVLQ ZDV FRORQLVHG ZLWK QXPHURXV *UHHN VHWWOHPHQWV7KHILUVWFRORQLVWVWRDUULYHLQ,WDO\PDGHWKHLUKRPHRQ

,17+(6+$'2:2)9(689,86

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·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¶QHZFLW\· WRGLIIHUHQWLDWHLWIURP QHDUE\3DOHSROLVWKH¶ROGFLW\·RI3DUWKHQRSH7KH\FKRVHDORFDWLRQ DORQJWKHVKRUHEHFDXVHRILWVSUR[LPLW\WRWKHVHDDQGFRQYHQLHQW VLWXDWLRQ RQ WKH D[LV RI QRUWKVRXWK DQG HDVWZHVW ,WDOLDQ WUDGLQJ URXWHV1HDSROLVZDVDZDOOHGFLW\O\LQJRQDIODWSODLQ7KHQHZWRZQ

$1&,(171$3/(6

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

,17+(6+$'2:2)9(689,86

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

$1&,(171$3/(6

DVHULHVRIPDODULDHSLGHPLFVDQGZDVHYHQWXDOO\DEDQGRQHGDVWKH LQKDELWDQWV OHIW IRU KLJKHU JURXQG 3DHVWXP VRRQ EHFDPH D JKRVW WRZQDQGWRGD\RQO\WKHWHPSOHVUHPDLQVWDQGLQJDVDWHVWLPRQ\ WRWKHLPSRUWDQFHRIUHOLJLRQLQWKHFLYLFOLIHRIDQWLTXLW\7KHFLW\·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·VPHPEHUVLQGXOJLQJLQ RUJLDVWLFULWXDOVDODUPHGWKHDXWKRULWLHV7KHKLVWRULDQ/LY\WHOOVXV

,17+(6+$'2:2)9(689,86

7R WKH UHOLJLRXV FRQWHQW ZHUH DGGHG WKH SOHDVXUHV RI ZLQH DQG IHDVWLQJ WR DWWUDFW D JUHDWHU QXPEHU:KHQ WKH\ ZHUH KHDWHG ZLWK ZLQHDQGDOOVHQVHRIPRGHVW\KDGEHHQH[WLQJXLVKHGE\WKHGDUNQHVV RIQLJKWDQGWKHPLQJOLQJRIPHQZLWKZRPHQDQG\RXQJZLWKROG WKHQGHEDXFKHULHVRIHYHU\NLQGEHJDQDQGDOOKDGSOHDVXUHVDWKDQGWR VDWLVI\WKHOXVWWRZKLFKWKH\ZHUHPRVWLQFOLQHG

7KHSHRSOHRI*UHHN1HDSROLVZHUHERXQGWRJHWKHUE\WKHLUVKDUHG UHOLJLRQDQGGLGQRWNQRZSROLWLFDOGLYLVLRQV7KHFLYLFDGPLQLVWUDWLRQ ZDVPDQDJHGE\DSROLWLFDOIUDWULHUHVSRQVLEOHIRUWKHYDULRXVDUHDVRI WKHFLW\7KHVHRUJDQLVDWLRQVEDVHGWKHLUSKLORVRSK\RQDQLGHDORI PXWXDOIUDWHUQDOVHOILQWHUHVW,WLVWKRXJKWWKDWWKHUHZHUHDWOHDVW WHQ IUDWULH GLYLGLQJ WKH FLW\ LQWR ZHOOGHILQHG VHOIDGPLQLVWHUHG QHLJKERXUKRRGV (GXFDWLRQDQGOHDUQLQJZHUHFHQWUDOWR*UHHNOLIH1HDSROLVZDV NQRZQ DV D FHQWUH RI (SLFXUHDQLVP RQH RI WKH PRVW LPSRUWDQW +HOOHQLVWLFSKLORVRSKLFDOVFKRROV,WVIRXQGHU(SLFXUXVKHOGSOHDVXUH WREHWKHKLJKHVWJRRG+HWDXJKWWKDWWKHDLPRIWKHKDSS\OLIHZDVWKH DEVHQFHRIERWKSK\VLFDODQGPRUDOSDLQ7KH(SLFXUHDQOLIHVKRXOG EH OHG IUHH IURP WKH VWUHVVHV RI GDLO\ OLIH DQG SROLWLFV GHGLFDWHG WRDTXHVWIRUNQRZOHGJHDQGLQQHUSHDFH(SLFXUXVHVWDEOLVKHGD SKLORVRSKLFDO VFKRRO LQ WKH JDUGHQ RI KLV KRPH LQ$WKHQV ZKLFK ZDVDQRDVLVRIOHDUQLQJDQGIULHQGVKLSRSHQWRDOO²HYHQZRPHQ DQGVODYHV+LVIROORZHUVZHUHUHIHUUHGWRDV¶WKHJDUGHQSHRSOH·E\ PDQ\FODVVLFDOZULWHUV(SLFXUXV·SKLORVRSKLFDOV\VWHPDOVRVRXJKW WRRYHUFRPHLUUDWLRQDOIHDURIQDWXUDOSKHQRPHQDVXFKDVYROFDQRHV DQGHDUWKTXDNHVZKLFKKHH[SODLQHGWKURXJKDWRPLVPWKHQRWLRQ WKDWPDWWHULVPDGHXSRIVPDOOLQGLYLVLEOHSDUWLFOHV$Q(SLFXUHDQ VFKRRORIFRQVLGHUDEOHLPSRUWDQFHZDVHVWDEOLVKHGLQ1HDSROLVLQ WKH ILUVW FHQWXU\ %& E\ WKH 6\ULDQ VFKRODU 3KLORGHPXV RI *DGDUD 7KH5RPDQSRHW/XFUHWLXVZKRPD\KDYHVWXGLHGLQ1DSOHVZURWH DOHQJWK\SRHPRXWOLQLQJWKHFRQFHSWRIDWRPLVPHQWLWOHG'H5HUXP

$1&,(171$3/(6

1DWXUD¶2QWKH1DWXUHRI7KLQJV· ZKLFKZRXOGEHYHU\LQIOXHQWLDO RQ ODWHU VFLHQWLILF DQG SKLORVRSKLFDO WKRXJKW (SLFXUHDQLVP ZDV YLHZHGZLWKKRVWLOLW\QRWRQO\E\&LFHURDQG3OXWDUFKEXWDOVRE\ WKH5RPDQ6HQDWHZKLFKWRRNRIILFLDODFWLRQDJDLQVWVRPH(SLFXUHDQ WKLQNHUV7KLV GLVIDYRXU ZRXOG ODWHU PDNH WKH PRYHPHQW DQ HDV\ WDUJHWIRU&KULVWLDQSKLORVRSKHUVIRUZKRP¶HSLFXUH·EHFDPHOLWWOH PRUHWKDQDV\QRQ\PIRUDWKHLVWRUOLEHUWLQH 5RPDQ1DSOHV

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«WKRVHYLQHFODGKLOOVZLWKWKHLUJORULRXV ZLQHDQGZDVVDLOIDPRXVWKHZRUOGRYHU

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

,17+(6+$'2:2)9(689,86

WKHFLW\IUHHGRPRIWUDGLWLRQVODQJXDJHFXVWRPVDQGUHOLJLRQ7KXV 1HDSROLVZDVDEOHWRUHWDLQKHUVWURQJ*UHHNLGHQWLW\ 7KH5RPDQVDSUDFWLFDOQDWLRQRIVROGLHUVDQGEXUHDXFUDWVZHUH YHU\PXFKDWWUDFWHGWR*UHHNDUWDQGSKLORVRSK\6FDUFHO\DQDVSHFW RI5RPDQOLIHHVFDSHGLQIOXHQFHIURP*UHHNFXOWXUHDQG1HDSROLV VHUYHGDVWKHWUDQVIRUPDWLRQSRLQWIRUWKLVSURFHVV6WUDERLQKLV *HRJUDSK\LQIRUPVXVWKDW JUHDWHUYRJXHLVJLYHQWRWKH*UHHNPRGHRIOLIHDW1HDSROLVE\WKH SHRSOHZKRZLWKGUHZWKLWKHUIURP5RPHIRUWKHVDNHRIUHVW²,PHDQ WKHFODVVZKRKDYHPDGHWKHLUOLYHOLKRRGE\WUDLQLQJWKH\RXQJRUVWLOO RWKHUVZKREHFDXVHRIROGDJHRULQILUPLW\ORQJWROLYHLQUHOD[DWLRQ DQGVRPHRIWKH5RPDQVWRRWDNLQJGHOLJKWLQWKHZD\RIOLYLQJDQG REVHUYLQJWKHJUHDWQXPEHURIPHQRIWKHVDPHFXOWXUHDVWKHPVHOYHV VRMRXUQLQJWKHUHJODGO\IDOOLQORYHZLWKWKHSODFHDQGPDNHLWWKHLU SHUPDQHQWDERGH

&LFHURDIUHTXHQWYLVLWRUWR1HDSROLVFRPPHQWHG ,KDYHRIWHQVHHQQRWRQO\ZHOONQRZQ5RPDQFLWL]HQVEXWDOVR\RXQJ PHQRIQREOHELUWKDQGHYHQDIHZVHQDWRUVERUQLQWRWKHKLJKHVWUDQN RIVRFLHW\DOOIRUWKHVDNHRIGHOLJKWDQGSOHDVXUHGUHVVHGLQGDUNWXQLFV LQWKH*UHHNPDQQHUDQGQRWLQWKHLUSULYDWHSDUNVRUVXEXUEDQHVWDWHV EXWDW1HDSROLVWKDWLVLQDYHU\GHQVHO\SRSXODWHGFLW\

7KH 5RPDQ DULVWRFUDF\ HQMR\HG WUDYHOOLQJ WR 1HDSROLV WR ZHDU *UHHNFRVWXPHVDQGSUDFWLVH*UHHNFXVWRPVDVDIRUPRIUHOD[DWLRQ 1HDSROLV ZDV UHQRZQHG IRU *UHHN DWKOHWLF JDPHV DQG UHOLJLRXV IHVWLYDOV *UHHN SOD\V ZHUH SURGXFHG LQ WKH FHOHEUDWHG WKHDWUHV RI 1HDSROLV DQG GUHZ PDQ\ YLVLWRUV7KHUH LV HYHQ D /DWLQ YHUE SHUJUDHFDULZKLFKPHDQVWRDFWOLNHD*UHHNRUUDWKHUZLWKRXWWUXH 5RPDQGLJQLW\XVXDOO\LPSO\LQJH[FHVVLYHHQMR\PHQWRIIRRGZLQH DQG OLELGLQRXV DFWLYLW\¶&RPH RQ WKHQ NHHS JRLQJ VLQFH \RX·YH PDGH D VWDUW GULQN DFW OLNH *UHHNV >SHUJUDHFDPLQL@ JR RQ VWXII

$1&,(171$3/(6

\RXUVHOYHVNLOOWKHIDWWHGFDOI· DQG¶:HFRXOGVKRZ\RXDSDODFH RIIUHHGRPDQGSOHDVXUHZKHUH\RXFDQORYHGULQNDQGDFWOLNHD *UHHN>SHUJUDHFDPLQL@·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·VFLYLOZDUV1HDSROLVWZLFHEDFNHGWKHORVLQJ SDUW\ ,Q SXQLVKPHQW VHYHUDO OHDGLQJ FLWL]HQV ZHUH VXPPDULO\ H[HFXWHG NLOOLQJ D ODUJH SURSRUWLRQ RI WKH FLW\·V HQWUHSUHQHXULDO FODVV DQG OHDGLQJ WR VWDJQDWLRQ LQ WKH HFRQRP\ 1HDSROLV EHJDQ D JUDGXDOGHFOLQHLQIDYRXURI3XWHROLWRGD\3R]]XROL WRWKHQRUWK ZKRVHSRUWZDVKHDYLO\GHYHORSHGE\WKH5RPDQV7KHDPSKLWKHDWUH

3ODXWXV0RVWHOODULD 3RHQXOXV

,17+(6+$'2:2)9(689,86

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· YLOOD RQ WKH WLQ\ LVODQG RI 0HJDULGH ZDV UHQRZQHG QRW RQO\ IRU WKH VSOHQGRXU RI LWV NLWFKHQV DQG WKH EHDXW\RILWVGHFRUDWLRQEXWDOVRDVWKHKRPHRIWKHODUJHVWOLEUDU\ LQ ,WDO\ KRVSLWDEO\ RSHQ WR DQ\RQH ZKR ZLVKHG WR FRQVXOW WKH SDUFKPHQWWH[WV$OWKRXJKKHZDVDJUHDWPLOLWDU\KHUR/XFXOOXVLV UHPHPEHUHGPRUHIRUKLVPDJQLILFHQW1HDSROLWDQYLOODWKDQIRUKLV EDWWOHILHOGH[SORLWV9HGLR3ROOLRQH·VYLOODZDVLISRVVLEOHHYHQPRUH VXPSWXRXV+LVKRPH3DXV\OLSRQIURPWKH*UHHNZRUGPHDQLQJ ¶IUHHGRPIURPSDLQ· ZDVORFDWHGRQWKHKLOOWRWKHQRUWKRIWKH%D\ RI1DSOHVZKLFKWDNHVLWVPRGHUQQDPH3RVLOOLSR IURPWKHYLOOD 6LWXDWHGLQDJUDQGLRVHSDUNFRPSOHWHZLWKLWVRZQSULYDWHWKHDWUH WKHYLOODZDVDQLGHDOVHWWLQJIRUWKHHQMR\PHQWRISULYLOHJHGRWLXP 0DQ\RWKHULQIOXHQWLDO5RPDQVEXLOWYLOODVLQ%DLDHVOLJKWO\WRWKH QRUWK RI 1HDSROLV LQ WKH 3KOHJUHDQ )LHOGV DUHD7KH SRHW +RUDFH H[FODLPHG ZLWK UDSWXUH WKDW¶7KHUH LV QRWKLQJ LQ WKH ZRUOG WR FRPSDUHWRVSOHQGLG%DLDH·,WZDVWKHXOWLPDWHUHVRUWWRZQ7RGD\ IROORZLQJFHQWXULHVRIVHLVPLFDFWLYLW\PXFKRIDQFLHQW%DLDHOLHV EHQHDWKWKHVHDDQGRQHFDQWUDYHODFURVVWKHOLWWOHED\LQDJODVV ERWWRPHG ERDW WR YLHZ WKH PRVDLF IORRUV RI VXEPHUJHG 5RPDQ YLOODV

$1&,(171$3/(6

7KHYDULRXVWHPSWDWLRQVRQRIIHUZHUHDVSHUVXDVLYHDQGVHGXFWLYH DV WKH PXVLF RI WKH VLUHQV ,QGHHG WKH FRDVWDO WRZQ RIIHUHG VXFK SOHDVXUHVWKDWWKHFDUHVDQGUHVSRQVLELOLWLHVRI5RPHZHUHTXLFNO\ IRUJRWWHQ,QDQRWHWRKLVWUDQVODWLRQRI3OLQ\·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

7KH SRHW 6HVWXV 3URSHUWLXV VXIIHUHG SDUR[\VPV RI MHDORXV\ ZKHQ KLVORYHU&\QWKLDKROLGD\HGZLWKRXWKLPLQ%DLDH+LVLPDJLQDWLRQ UDQUDPSDQWDWWKHWKRXJKWRIWKHWHPSWDWLRQVVKHPLJKWIDFHDQG KHLPSORUHGKHUWRUHWXUQWR5RPH¶'ROHDYHFRUUXSW%DLDHMXVW DV TXLFNO\ DV \RX FDQ WKRVH EHDFKHV ZLOO JLYH GLYRUFHV WR PDQ\ EHDFKHVZKLFKZHUHWKHXQGRLQJRIFKDVWHJLUOV$KPD\WKHZDWHUV RI%DLDHSHULVKIRUWKHLUFULPHDJDLQVWORYH·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

,17+(6+$'2:2)9(689,86

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·V VXSSRUW EDVH WKURXJKDPELWLRXVDUFKLWHFWXUDOSURMHFWVDQGWKHHQFRXUDJHPHQWRI SDWULRWLFOLWHUDU\ZRUNV9LUJLODQG+RUDFHWZRRIWKHJUHDWHVW/DWLQ SRHWVHPERG\WKH$XJXVWDQLGHRORJ\ /LNHVRPDQ\RWKHU5RPDQLQWHOOHFWXDOVWKH\VDZWKHH[HUFLVH RILQWHOOHFWDVD*UHHNFKDUDFWHULVWLFDQGERWKZHUHGUDZQWRVWXG\ DWWKH(SLFXUHDQVFKRROLQ1HDSROLV+HUH9LUJLO·VVSLULWGLVFRYHUHG ZKDWLWKDGEHHQPLVVLQJLQ5RPHDQGKHIDPRXVO\GHVFULEHGKLV \HDUV RI 1HDSROLWDQ RWLXP¶$W WKDW WLPH VZHHW 3DUWKHQRSH FDUHG IRU PH9LUJLO KDSS\ LQ P\ VWXGLHV RI LJQREOH LGOHQHVV·9LUJLO·V EXFROLF SRHWU\ FHOHEUDWHG WKH UXUDO OLIH KH HQMR\HG RQ WKH VKRUHV RI WKH %D\ RI 1DSOHV ,W ZDV9LUJLO ZKR ILUVW HYRNHG WKH P\WK RI $UFDGLDWKHLGHDOLVHGSDVWRUDOODQGVFDSHRIFHQWUDO*UHHFHZKHUH WKHVLPSOHEXFROLFOLIHRIIHUHGWKHLGHDODWPRVSKHUHIRULQWHOOHFWXDO FRQWHPSODWLRQ DQG WKH KDSS\ OLIH +RUDFH DGRSWHG WKH9LUJLOLDQ FRQFHSW RI WKH ORFXV DPRHQXV WR GHILQH WKH LGHDO EHDXW\ VSRW IRU URPDQWLF DQG DPRURXV HQFRXQWHUV 7KH LGHDOV RI WKH $XJXVWDQ

$1&,(171$3/(6

DJH DUH DOVR HYLGHQW LQ +RUDFH·V 2GHV (SRGHV 6DWLUHV DQG (SLVWOHV LQFOXGLQJ WKH $UV 3RHWLFD +RUDFH ZURWH PXFK RI KLV SRHWU\ DQG OLWHUDU\FULWLFLVPLQ1HDSROLV7UDQVSDUHQWLPDJHU\DQGKDUPRQLRXV ODQJXDJHPDNH+RUDFHWKHHSLWRPHRIDFODVVLFDOSRHW7KHLQIXVLRQ RIWKHEHVWRIWKH*UHHNKHULWDJHLQWRWKHQHZFXOWXUHRI5RPH +RUDFHZDVDWUXH1HDSROLWDQVSLULW+RUDFH·V/DWLQYHUVHSHUIHFWO\ H[SUHVVHG WKH GHOLFDF\ EDODQFH DQG JUDFH RI *UHHN SRHWU\ +H HPERGLHGWKHIDWDOLVPRIWKH*UHHNVDVZHOODVWKHLUJUDVSRIWKH DUW RI OLYLQJ +LV EHVW NQRZQ PD[LP ²FDUSH GLHP RU VHL]H WKH PRPHQW²LVWKHXQRIILFLDOPRWWRRIWKH1HDSROLWDQV2QHRIWKH PRVW EHDXWLIXO URDGV LQ PRGHUQ 1DSOHV D SDQRUDPLF VWUHHW ZLWK EUHDWKWDNLQJ YLHZV ZKLFK ZLQGV WKURXJK WKH KLOO RI 3RVLOOLSR LV QDPHGDIWHU+RUDFH²YLD2UD]LR 9LUJLO·VHSLFSRHPWKH $HQHLGZULWWHQLQ1HDSROLVDQGVHWSDUWLDOO\ LQ&XPDHZDVWKHHPERGLPHQWRIWKHQHZ$XJXVWDQLGHRORJ\DQG SURYLGHG WKH EDVLV RI D QDWLRQDO OLWHUDWXUH IRU 5RPH7KH $HQHLG SUHVHQWV D SURSKHF\ RI WKH JORULRXV GHVWLQ\ RI WKH JHQV ,XOLD WKH IDPLO\ RI WKH HPSHURU %\ LQYHQWLQJ D JHQHDORJ\ UHDFKLQJ EDFN WR WKH7URMDQ:DU9LUJLO UHLQIRUFHG WKH OHJLWLPDF\ RI$XJXVWXV·V FODLPWRLPSHULDOSRZHUDWWDFKLQJWKH/DWLQHSLFWRWKH+RPHULF PRGHO9LUJLO·VSRHPWHOOVWKHVWRU\RI$HQHDVZKRVDLOHGWR,WDO\ DIWHUWKH7URMDQ:DUE\ZD\RI$IULFDDQGDWU\VWZLWK4XHHQ'LGR RI&DUWKDJH+HHYHQWXDOO\DUULYHGLQ/DWLXPZKHUHKHHVWDEOLVKHG WKHLPSHULDOIDPLO\OLQH$HQHDVUHSUHVHQWVWKHHPERGLPHQWRIWKH LGHDOTXDOLWLHVRID5RPDQFLWL]HQ+HLVSLRXVGLJQLILHGEUDYHDQG GHYRWHGWRGXW\:ULWWHQLQ1HDSROLV9LUJLO·V $HQHLGLVWKHXOWLPDWH H[DPSOHRIWKHZD\LQZKLFK5RPHEXLOWLWVLGHQWLW\RQWKHFXOWXUH DQGLGHRORJ\RI*UHHFH2QHRIWKHSRHP·VPRVWVLJQLILFDQWHSLVRGHV LVVHWLQ&XPDH7KH&XPDHDQ6\ELODUHODWLYHRIWKH'HOSKLFRUDFOH ZDV D SURSKHWHVV ZKR VSRNH WKURXJK WKH LQVSLUDWLRQ RI $SROOR 9LUJLOKLPVHOIPD\KDYHYLVLWHGWKH6\ELO·VFDYHDVWKHRUDFOHZDVVWLOO

,17+(6+$'2:2)9(689,86

DFWLYHGXULQJKLVOLIHWLPH,Q%RRN9,RIWKH$HQHLG9LUJLOGHVFULEHV $HQHDV·VLQWHUYLHZZLWKWKH6\ELO+HUFDYHFDUYHGLQWRWKHVRIW ORFDOWXIDVWRQHZDVDFFHVVLEOHWKURXJKDVXEWHUUDQHDQSDVVDJHZD\ 7KHKXJHVLGHRIWKH(XERHDQURFNLVKHZQLQWRDFDYHUQZKLWKHUOHDG DKXQGUHGZLGHPRXWKVDKXQGUHGJDWHZD\VZKHQFHUXVKDVPDQ\ YRLFHVWKHDQVZHUVRIWKH6\ELO7KH\KDGFRPHWRWKHWKUHVKROGZKHQ WKHPDLGHQFULHV¶7LVWLPHWRDVNWKHRUDFOHVWKHJRGORWKHJRG· $V WKXV VKH VSDNH EHIRUH WKH GRRUV VXGGHQO\ QRU FRXQWHQDQFH QRU FRORXUZDVWKHVDPHQRUVWD\HGKHUWUHVVHVEUDLGHGEXWKHUERVRP KHDYHVKHUKHDUWVZHOOVZLWKZLOGIUHQ]\DQGVKHLVWDOOHUWREHKROG QRUKDVKHUYRLFHDPRUWDOULQJVLQFHQRZVKHIHHOVWKHEUHDWKRIGHLW\ ¶$UWWKRXVORZWRYRZDQGWRSOD\"·VKHFULHV¶$UWWKRXVORZ7URMDQ $HQHDV")RUWLOOWKHQWKHPLJKW\PRXWKVRIWKHDZHVWUXFNKRXVHZLOO QRWJDSHRSHQ·6RVKHVSDNHDQGZDVPXWH$FKLOOUDQWKURXJKWKH 7HXFULDQV·VWXUG\IUDPHV

7KH6\ELOWKHQDFFRPSDQLHG$HQHDVLQWR+DGHVWKHUHLJQRI3OXWR WKURXJKWKHHHULHVROIDWDUD$IWHU9LUJLO·VGHDWKLQ%ULQGLVLKHZDV EXULHGLQ1HDSROLVZKHUHKHKDGIRXQGKLVLQVSLUDWLRQDQGLQKLV RZQ ZRUGV KLV HSLWDSK LV 0DQWXD PH JHQXLW &DODEUL UDSXHUH WHQHW QXQF3DUWKHQRSHFHFLQLSDVFXDUXUDGXFHV¶0DQWXDERUHPH&DODEULD VWROHPHDQGQRZGRHV3DUWKHQRSHSRVVHVVPH,VDQJRISDVWXUHV ILHOGVDQGZDUULRUNLQJV· 9LUJLO·VWRPELQ0HUJHOOLQDVRRQEHFDPH DSODFHRISLOJULPDJH 3RZHUFRUUXSWVLWLVVDLGDQGDEVROXWHSRZHUFRUUXSWVDEVROXWHO\ DV LV PRVW HYLGHQW LQ WKH VDG GHFOLQH RI WKH$XJXVWDQ OLQH ZKLFK KDGEHHQVRH[DOWHGLQ9LUJLO·VHSLFSRHP7KHHPSHURUV7LEHULXV DQG&ODXGLXVOLYHGLQOX[XU\RQ&DSULLQDPDJQLILFHQWUHVLGHQWLDO FRPSOH[RIZKLFKRQO\UXLQVUHPDLQWRGD\9LOOD-RYLVLVORFDWHGDW DPDMHVWLFDQGLPSRVLQJVLWHRQRQHRIWKHURFN\RXWFURSVRIWKH VDGGOHVKDSHGLVODQG1RZUHGXFHGWROLWWOHPRUHWKDQUXEEOHWKH HQWLUH SDODFH RQFH FRYHUHG RYHU VTXDUH PHWUHV FRQWDLQLQJ

$1&,(171$3/(6

9LHZRI&DSUL

VHUYDQWV· TXDUWHUV RIILFHV DFFRPPRGDWLRQ IRU WKH FRXUW WKH HPSHURU·VSULYDWHDSDUWPHQWVDQGDVHULHVRILQGLYLGXDODSDUWPHQWV IRU WKH QXPHURXV LPSHULDO PLVWUHVVHV 6RPH RI WKH ULFK PDUEOH SDYHPHQWV DUH VWLOO LQ HYLGHQFH DQG WKH IORRU SODQ RI WKH YLOOD LV FOHDUO\YLVLEOH1HUR·VUHLJQPDUNHGWKHHQGRIWKLVHUDLQ5RPDQ KLVWRU\ 2QH RI WKH PRVW PHPRUDEOH 5RPDQ HPSHURUV KH ZDV DQH[WUDYDJDQWUXOHU7DFLWXVWHOOVXVWKDW¶1HURGLVJUDFHGKLPVHOI ZLWKHYHU\NLQGRIDERPLQDWLRQQDWXUDODQGXQQDWXUDOOHDYLQJQR IXUWKHUGHSWKRIGHEDXFKHU\WRZKLFKKHFRXOGVLQN·$W\UDQQLFDO DQGREHVHPHJDORPDQLDFKHORYHGQRWKLQJPRUHWKDQWRLQGXOJH

,17+(6+$'2:2)9(689,86

LQSDUWKHQRSHDQRWLXP1HUREXLOWDVWXQQLQJYLOODLQ%DLDHZKLFK ULYDOOHGWKHOX[XU\RIKLV*ROGHQ+RXVHLQ5RPH7KHEDWKVZHUH VDLG WR VWUHWFK IURP &DSH 0LVHQXP WR /DNH$YHUQXV7RGD\ LW LV DOPRVW SRVVLEOH WR UHFUHDWH WKH DPELHQFH RI WKH GHFOLQLQJ \HDUV RI WKH 5RPDQ (PSLUH LQ DQ XQXVXDO VSRW NQRZQ DV WKH 6WXIH GL 1HURQH RU¶1HUR·V 2YHQV· D VHULHV RI LQGRRU DQG RXWGRRU SRROV ZLWKDUHVWDXUDQWDQGEDUQRWXQOLNHPDQ\RWKHUPRGHUQEDWKLQJ HVWDEOLVKPHQWV HOVHZKHUH LQ ,WDO\ 7KH 6WXIH KRZHYHU KDYH WKH DGGHGDWWUDFWLRQRIOHDGLQJLQWRDQFLHQW5RPDQVWHDPEDWKVFDUYHG LQWRWKHKLOOVLGHDOWKRXJKZKHWKHU1HURUHDOO\EDWKHGKHUHZHDUH OHIWWRVSHFXODWH:DQGHULQJIURPRQHURRPWRWKHQH[WRQHPRYHV HYHUIXUWKHULQWRXQGHUJURXQGFDYHVIHGE\WKHYROFDQLFKRWVSULQJV RI WKH VROIDWDUD 2QH FDQ HDVLO\ LPDJLQH WKH IHDUV RI 3HUVHSKRQH DQG$HQHDV XSRQ HQWHULQJ +DGHV DV WKH VWHDP EHFRPHV WKLFNHU DQGILJXUHVRIEDWKHUVULVHIURPWKHPLVW7KHRYHUDOODWPRVSKHUH LVRQHRIORXFKHSOHDVXUHDQGDPELJXRXVHQFRXQWHUV1HURRIWHQ SURFHVVHGIURPKLVYLOODLQ%DLDHWR1HDSROLVZKHUHKHWRRNJUHDW SOHDVXUHLQYLVLWVWRWKHWKHDWUHDQGDFWXDOO\SHUIRUPHGLQVXFKZRUNV DV 1LREH &DQDFH LQ &KLOGELUWK 2UHVWHV WKH 0DWULFLGH 2HGLSXV %OLQGHG DQG'LVWUDXJKW+HUFXOHV1HURRQFHUHPDLQHGRQVWDJHLQ1HDSROLV IRUVL[GD\VZLWKRXWLQWHUUXSWLRQHDWLQJVOHHSLQJDQGSHUIRUPLQJ PRVWERGLO\IXQFWLRQVEHIRUHDQDVWRQLVKHGDXGLHQFH7KHHPSHURU ZDVVRREVHVVHGZLWKFRQWUROOLQJHYHU\GHWDLORIWKHVHSHUIRUPDQFHV WKDWKHHYHQLQVLVWHGWKDWDSSODXVHEHRUJDQLVHGLQDGYDQFHWKHUHE\ LQVWLWXWLQJWKHILUVWFXHGDXGLHQFHV 7KH DSSODXVH ZDV VSRQWDQHRXV KRZHYHU ZKHQ FRDUVH IDUFHV NQRZQ DV IDEXODH DWHOODQDH ZHUH SHUIRUPHG LQ WKH ORFDO GLDOHFW E\EDZG\WURXSHVRIORFDODFWRUV7KHVHZHUHILUVWVWDJHGDVHDUO\ DVWKHIRXUWKFHQWXU\ %& EXW E\ 5RPDQ WLPHV KDG EHFRPHTXLWH SRSXODU DQG ZHUH RIWHQ SHUIRUPHG LQ WKH WKHDWUHV RI 1HDSROLV 7KHUHZHUHIRXU$WHOODQ¶PDVNV·RUVWRFNFKDUDFWHUV0DFFXVWKH

$1&,(171$3/(6

MHVWHU%XFFRWKHFKXEE\VLPSOHWRQ3DSSXVWKHHOGHUO\FXFNROG DQG'RVVHQXVWKHFXQQLQJWULFNVWHU7KHDFWRUVSRUWUD\HGDUXVWLF UHDOLW\ ² SHQHWUDWLQJ ZLWW\ DQG VHOIFULWLFDO ²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·V ZRUNVKRSV DQG WDYHUQV7KH EXVLHVW ZHUH WKH WDEHUQDH YLQDULDH ZKLFK VROG ORFDO ZLQHV DQG OLJKW PHDOV LQ D UXVWLF DWPRVSKHUH 7KH ORFDO SHUIXPH VKRSV ZHUH IDPRXV IRU KHGU\FXP D UHQRZQHG SHUIXPH SURGXFHG ORFDOO\ 0DQ\ VXFK ORFDO VKRSV ZHUH UXQ E\ ZRPHQ DQFHVWRUV RI WKH UHVRXUFHIXO PDWULDUFKV RI WRGD\ 2QH VKRSNHHSHU *UDWLGLD ZDV +RUDFH·V PLVWUHVV XQWLO VKH VKDUHG KHU IDYRXUVZLWKDQRWKHUPDQ*UHDWO\GLVWUHVVHG+RUDFHWRRNUHYHQJH IRUDOOSRVWHULW\E\GHVFULELQJKHUDVDOLELGLQRXVKDUS\LQRQHRI KLVSRHPV7KHPRUDOLVW6HQHFDGLGQRWKDYHDIHHOLQJIRUWKHFLW\·V YLWDOLW\$FWXDOO\KHGHSORUHG1DSOHVFRPSODLQLQJWKDWWKHVWUHHWV ZHUHFRYHUHGLQPXGDQGGXVWWKHPDJLVWUDWHVZHUHIRUVDOHDQGWKH OLIHVW\OHZDVRYHUWO\LPPRUDO,QVSLWHRI6HQHFD·VPLVJLYLQJVWKH

,17+(6+$'2:2)9(689,86

FLW\·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·V*UHHNKHULWDJHZKLFKDWWUDFWHG DQG LQWULJXHG WKH 5RPDQV 2QH RI WKH PRVW FHOHEUDWHG 5RPDQ SRHWV 3XEOLXV 3DSLQXV 6WDWLXV ZDV DFWXDOO\ ERUQ LQ 1HDSROLV LQ $' $OWKRXJK KH OLYHG LQ 5RPH IRU PXFK RI KLV OLIH KH QHYHU PLVVHGDQRFFDVLRQWRUHWXUQWRKLVELUWKSODFHWRSDUWLFLSDWHLQWKH *UHHNJDPHV2QRQHRFFDVLRQ6WDWLXVLVHYHQNQRZQWRKDYHEHHQ KRQRXUHGZLWKDFURZQRIODXUHOV+HLVHQWKXVLDVWLFLQKLVSUDLVHRI WKHFLW\RIKLVELUWK 7KHZLQWHUKHUHLVWHPSHUDWHDQGWKHVXPPHULVFRRO+HUHWKHVHD·V VORZZDYHVEHDWZLWKWUDQTXLOOLW\DQGHYHU\RQHLVDVVXUHGJUHDWSHDFH RWLXPDQGQHYHUHQGLQJTXLHW«7KHFLUFXVDQGWKHDWUHDUHHQRUPRXV DQG RQH FDQ VHH WKH TXLQTXHQQLDO JDPHV ZKLFK DUH DV LPSRUWDQW DV WKRVH RQ WKH &DPSLGRJOLR DQG ZKDW ODXJKWHU DW WKH FRPHGLHV E\ 0HQDQGHUZKLFKPL[WRJHWKHUJDJVDQGVHULRXVQHVV%DVLFDOO\LWLVD PL[WXUHRI5RPHDQG*UHHFH

$1&,(171$3/(6

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¶:LOOWKHQH[WJHQHUDWLRQRIPHQEHOLHYHZKHQFURSVJURZDJDLQ DQGWKHVHGHVHUW ILHOGV DUH RQFHPRUH FRYHUHG ZLWK IORZHUV WKDW XQGHUWKHLUIHHWZKROHFLWLHVDQGWKHLUSRSXODWLRQVOLHEXULHGDQG WKDWWKHILHOGVRIWKHLUIRUHIDWKHUVVDQNLQWRWKHDE\VPDOGHSWK"·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

,17+(6+$'2:2)9(689,86

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²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¶0D\ \RX EORVVRP IRUHYHU 6DELQD 3UHVHUYH \RXU EHDXW\DQG\RXUPDLGHQKRRGIRUPDQ\\HDUV·6DGO\VKHSDLGOLWWOH KHHGWRWKLVZLVHDGYLFHVDFULILFLQJKHUYLUWXHWRWKH(PSHURU1HUR ZKRODWHUPDUULHGKHULQ$'$VHPSUHVVVKHHQGXUHGDYLROHQW UHODWLRQVKLSZLWKKHUGLVWXUEHGDQGDEXVLYHKXVEDQGZKRNLFNHG KHUWRGHDWKDIHZZHHNVEHIRUHVKHKDGEHHQGXHWRJLYHELUWKWR WKHLUILUVWFKLOG

$1&,(171$3/(6

6DELQD·VSURVSHURXVIDPLO\ZRXOGKDYHEHHQZHOONQRZQWRWKH EDQNHU&DHFLOLXV-XFXQGXVZKROLYHGLQYLD6WDELDQDZKHUHKHKDG DVPDOORIILFHIURPZKLFKKHOHQWFDSLWDOWRORFDOPHUFKDQWVIRUD WLG\SURILW7KHODYDKDVSUHVHUYHGKLVDFFRXQWVFRPSOHWHUHFRUGV FRYHULQJ RYHU WHQ \HDUV GHWDLO YDULRXV ORDQV IRU DPRXQWV UDQJLQJ IURPWRVHVWHUFHVLQGLFDWLQJKLVPDVWHU\RIEDVLFEDQNLQJ DQGDFFRXQWLQJSULQFLSOHV-XFXQGXV·VSRUWUDLWEXVWGLVFRYHUHGLQ KLVKRPHRIIHUVDUHDOLVWLFSRUWUDLWRIWKHSURYLQFLDOEXVLQHVVPDQ +LVIDFLDOH[SUHVVLRQLVWKDWRIDQDVWXWHPDQRIWKHZRUOGFHUWDLQO\ QRWVRPHRQHWREHWULIOHGZLWK *UDIILWL WKURXJKRXW ERWK 3RPSHLL DQG +HUFXODQHXP DUH D WHVWDPHQWWRWKHFKDUPVRIWKHSURVWLWXWH3ULPLJHQLDZKRSOLHGKHU WUDGHRQWKHDSWO\QDPHG9HQXV6WUHHW¶:LWKZKDWMR\RIWKHH\HV KDYHZHDGPLUHG3ULPLJHQLD·¶+HUH·VWR3ULPLJHQLDPRVWVZHHW PRVWORYHDEOH+DLO·¶3ULPLJHQLD²ZRXOGWKDW,PLJKWEHFRPHWKH JHPLQ\RXUILQHULQJIRUQRPRUHWKDQDQKRXUVRWKDWDV\RXXVH LWWRVHDODOHWWHU,PLJKWNLVV\RXUOLSV·7KHPDQ\JUDIILWLGHGLFDWHG WR 3ULPLJHQLD EXLOG XS D SRUWUDLW RI DQ DFFRPSOLVKHG FRXUWHVDQ IURPDSDWULFLDQEDFNJURXQG+HUIDPLO\WKH1RYHOOLDVZHUHRQH RIWKHROGHVWLQWKHUHJLRQDQGVKHPD\KDYHEHHQZHOOHGXFDWHG EHIRUH IDOOLQJ RQ KDUG WLPHV RU SHUKDSV VKH ZDV D IUHHVSLULWHG ZRPDQZLWKQRLQWHUHVWLQPDUULDJHDQGFRQYHQWLRQDOIDPLO\OLIH 7KHUHLVHYLGHQFHWRVXJJHVWWKDWVKHIUROLFNHGLQWKHPHQ·VEDWKV LQ+HUFXODQHXPZLWKDEDQNHUDFROOHDJXHRI-XFXQGXV" QDPHG +HUPHURV%HORZDVFUDZOHGFDULFDWXUHRIDZRPDQLQSURILOHZLWKDQ DTXLOLQHQRVH3ULPLJHQLDKHUVHOISHUKDSV" LVDPHVVDJHDUUDQJLQJ DQ DVVLJQDWLRQ ,W UHDGV¶+HUPHURV WR 3ULPLJHQLD FRQTXHURU RI KHDUWVJUHHWLQJV&RPHWR3XWHROLDQGLQ7LPLQLDQXV6WUHHWDWWKH EDQNRI0HVVLXVDVNIRU+HUPHURVRI3KRHEXV·&OHDUO\KHUIDPH ZDV VXFK WKDW VKH VSUHDG KHU FKDUPV IDU DQG ZLGH WKURXJKRXW 1HDSROLVDQGWKHVXUURXQGLQJWRZQV3RPSHLL·VEURWKHOLVORFDWHG

,17+(6+$'2:2)9(689,86

LQWKHWKHDWUHGLVWULFWFORVHWRWKHEDWKVLWVZDOOVGHFRUDWHGZLWK HURWLF SDLQWLQJV GHWDLOLQJ WKH VHUYLFHV RQ RIIHU &RORXUIXO JUDIILWL RIIHUFUXGHGHWDLOVRIDPRURXVVNLOOVDQGSURZHVV¶/RYHUVDUHOLNH EHHVWKHLUOLYHVDUHVZHHWDVKRQH\·¶/RQJOLYHORYHUVGHDWKWRWKRVH ZKRGRQRWNQRZKRZWRORYH'RXEOHGHDWKWRWKRVHZKRKLQGHU ORYH·3ULDSLFLPDJHU\DERXQGVLQ3RPSHLLDQGWKHHUHFWSKDOOXVLV DXELTXLWRXVLPDJHLQVWDWXHVZDOOSDLQWLQJVODPSVDQGHYHQWKH KDQGOHVRIEHOOSXOOVLQSULYDWHKRPHV7KHSKDOOXVZDVDSURWHFWLYH FKDUPDQGLVZRUQE\VRPHPRUHVXSHUVWLWLRXV1HDSROLWDQVHYHQ WRGD\WRZDUGRIIWKHHYLOH\H0DQ\RIWKHPRUHULVTXpLWHPVIRXQG GXULQJH[FDYDWLRQVZHUHXQWLOUHFHQWO\NHSWXQGHUORFNDQGNH\LQ WKHFDPHUDSRUQRJUDÀ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oDGHVRIWKHLUKRPHVRIIHUHGOLWWOHLQGLFDWLRQRI

$1&,(171$3/(6

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

,17+(6+$'2:2)9(689,86

WKDWVRPHVFKRODUVEHOLHYHWKHYLOODPD\DFWXDOO\KDYHEHORQJHGWR 3KLORGHPRVDQGWKDWLWPD\KDYHEHHQWKHVLWHRIKLVSKLORVRSKLFDO VFKRRO7KHDWULXPZDVODUJHUWKDQWKHIRUXPRIDVPDOOWRZQDQG WKH VL]H RI LWV SRRO ULYDOOHG WKH VZLPPLQJ SRROV RI WKH ,PSHULDO %DWKVLQ5RPH,WZDVDQLGHDOLVWLFUHSUHVHQWDWLRQRIWKH(SLFXUHDQ JDUGHQ LQ$WKHQV DQG RQH FDQ HDVLO\ LPDJLQH WKH¶JDUGHQ SHRSOH· PHHWLQJKHUH6HYHUDORIWKHVWDWXHVZKLFKRULJLQDOO\VXURXQGHGWKH SHULVW\OHDUHFRQVLGHUHGDPRQJWKHJUHDWHVWPDVWHUSLHFHVRI5RPDQ VFXOSWXUH 'UXQNHQ )DXQ 6OHHSLQJ )DXQ DQG 5HVWLQJ +HUPHV ,Q WKHODVWFHQWXU\WKHHQWLUHYLOODZDVUHEXLOWDVDPXVHXPLQ0DOLEX &DOLIRUQLDWRWKHH[DFWVSHFLILFDWLRQVRIELOOLRQDLUHSKLODQWKURSLVW -RKQ3DXO*HWW\XQGHUWKHJXLGDQFHRI1RUPDQ1HXHUEXUJRIWKH $PHULFDQ$FDGHP\LQ5RPH 7KHUHLVHYLGHQFHRIHDUO\&KULVWLDQFRPPXQLWLHVLQ+HUFXODQHXP DQG 3RPSHLL DV UHOLJLRXV V\PEROV KDYH EHHQ GLVFRYHUHG RQ VRPH ZDOOV DQG LQGHHG WKHUH PD\ KDYH EHHQ D VPDOO FKDSHO LQ RQH KRXVHLQ+HUFXODQHXP7KHQHZUHOLJLRQHVWDEOLVKHGLWVHOIUDSLGO\ LQ 1HDSROLV DQG WKH VXUURXQGLQJ DUHD7KH ORFDO FRPPXQLW\ ZDV JUHDWO\VWUHQJWKHQHGDQGHQFRXUDJHGE\6DLQW3DXO·VYLVLWWR3XWHROL RQKLVZD\IURPWKH+RO\/DQGWR5RPH,QWKH1HZ7HVWDPHQW$FWV RIWKH$SRVWOHVZHUHDGWKDWDVD5RPDQFLWL]HQ3DXOKDGUHTXHVWHG WUDQVIHUWR5RPHWRSURWHVWKLVSXQLVKPHQWDQGLPSULVRQPHQWIRU SURIHVVLQJ WKH QHZ &KULVWLDQ IDLWK +H WUDYHOOHG E\ VHD IURP WKH +RO\/DQGDQGZDVEULHIO\VKLSZUHFNHGRQ0DOWDEHIRUHDUULYLQJ LQ,WDO\7KHYR\DJHLVGHVFULEHGLQWKH1HZ7HVWDPHQW¶$IWHURQHGD\ DVRXWKZLQGVSUDQJXSDQGZHUHDFKHG3XWHROLLQWZRGD\V7KHUH ZHIRXQGIHOORZ&KULVWLDQVDQGZHUHLQYLWHGWRVWD\DZHHNZLWK WKHP· $FWV² /HJHQGVRI6DLQW3HWHU·VYLVLWWR1HDSROLV DUHIRXQGLQYDULRXVKDJLRJUDSKLFDOFROOHFWLRQV+HLVVDLGWRKDYH FHOHEUDWHG PDVV LQ D FKDSHO RQ WKH VLWH RI WKH WKLUWHHQWKFHQWXU\ FKXUFKRI6DQ3LHWURDG$UDPLQ1HDSROLVDQGPD\KDYHFRQVHFUDWHG

$1&,(171$3/(6

WKH FLW\·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

&+$37(57:2

0 ( ' , ( 9 $ / 1$3/(6

%\]DQWLQH1DSOHV $ ' ¦

$

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¶WKHZDOORI 1DSOHVZDVLQDFFHVVLEOHRQRQHVLGHE\UHDVRQRIWKHVHDDQGRQ

,17+(6+$'2:2)9(689,86

WKHRWKHUEHFDXVHRIVRPHGLIILFXOWFRXQWU\DQGWKRVHZKRSODQQHG WRDWWDFNLWFRXOGJDLQHQWUDQFHDWQRSRLQWQRWRQO\EHFDXVHRILWV JHQHUDOVLWXDWLRQEXWDOVREHFDXVHWKHJURXQGVORSHGVWHHSO\·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·VVXFFHVVRU7HLD ZDVNLOOHGLQEDWWOHDJDLQVWWKH%\]DQWLQHJHQHUDO1DUVHWH(PSHURU -XVWLQLDQFRXOGEUHDWKHDKXJHVLJKRIUHOLHI %XW QRW IRU ORQJ«7KHUH ZDV VRRQ D QHZ SHULO IRU WKH ,WDOLDQ SHQLQVXOD,Q$'.LQJ$OERLQOHGWKH/RPEDUGVLQWR,WDO\7KH\ UHVSHFWIXOO\VNLUWHG5DYHQQD-XVWLQLDQ·V,WDOLDQFDSLWDODQGDUULYHG

0(',(9$/1$3/(6

LQ&DPSDQLDLQ$'7KH/RPEDUGVEHFDPHSHUPDQHQWVHWWOHUV WKH\LQWHUPDUULHGDQGDGRSWHGWKHORFDOODQJXDJHDQGFXOWXUH7KH LQGHSHQGHQW FLWLHV RI 1DSOHV 6DOHUQR DQG 3DHVWXP ZHUH DEOH WR UHVLVW WKH /RPEDUGV EHFDXVH WKHLU SUR[LPLW\ WR WKH VHD SURYLGHG WKHP ZLWK RWKHU OLQHV RI FRPPXQLFDWLRQ DQG VXSSOLHV $IWHU $OERLQ·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

,17+(6+$'2:2)9(689,86

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·V 5XOH HVWDEOLVKHG WKH EDVLVIRUPHGLHYDOPRQDVWLFOLIHEDVHGRQ¶SUD\HUDQGZRUN·(YHU\ FRPPXQLW\KDGDOLEUDU\7KHPRQDVWLFOLEUDULHVZHUHDPRQJWKH JUHDWHVWWUHDVXUHVRIWKH0LGGOH$JHVZKHUHVFULEHVWUDQVODWHGDQG WUDQVFULEHGWKHJUHDWZRUNVRIWKHFODVVLFDODQG&KULVWLDQWUDGLWLRQV %\WKHVHYHQWKFHQWXU\1DSOHVZDVDPDMRUFHQWUHIRUWUDQVODWLRQ DQG WUDQVFULSWLRQ 2QH RI WKH PRVW HPLQHQW DQG OHDUQHG FOHULFV RI%\]DQWLQH1DSOHVZDV)DWKHU$GULDQ,QKLV+LVWRULD(FFOHVLDVWLFD *HQWLV$QJORUXPWKH9HQHUDEOH%HGHSUDLVHG$GULDQ·VOLQJXLVWLFVNLOOV LQERWK*UHHNDQG/DWLQ+HZDVPDGHDELVKRSE\3RSH9LWDOLDQR DQGVHQWWR(QJODQG$OWKRXJK$GULDQGLGQRWZDQWWRDFFHSWWKLV KLJKKRQRXUKHREHGLHQWO\VHWRIIWRDWWHQGWKH&RXQFLORI+HWILHOG LQ$'+HUHPDLQHGLQ%ULWDLQEHFRPLQJDEERWRIWKHPRQDVWHU\

0(',(9$/1$3/(6

RI 6DLQW 3HWHU DQG 6DLQW 3DXO LQ &DQWHUEXU\ )DWKHU$GULDQ WRRN VRPH1HDSROLWDQFXOWXUHZLWKKLPWR%ULWDLQ²D/DWLQWH[WRIWKH *RVSHOVWUDQVFULEHGDWKLVPRQDVWHU\LQ1DSOHVDQGODWHUWUDQVODWHG LQWR6D[RQ *LYHQWKHLPSRUWDQFHRI&KULVWLDQLW\LQ0HGLHYDO(XURSHLWLV SHUKDSVQRWVXUSULVLQJWKDWWZRRIWKHYHU\IHZZRPHQZKRVHOLYHV IHDWXUHLQWKHFKURQLFOHVRIWKLVSHULRGZHUHERWKVDLQWV/LWWOHLV NQRZQRI6DLQW5HVWLWXWDD\RXQJZRPDQIURP1RUWK$IULFDH[FHSW WKDWVKHGLHGUDWKHUWKDQUHQRXQFHKHU&KULVWLDQIDLWK,WLVVDLGWKDW VKHZDVDGHYRXW\RXQJZRPDQZKRUHIXVHGWRJLYHXSKHUYLUJLQLW\ WRDVHQLRU5RPDQRIILFLDO+HZDVLQIXULDWHGE\KHUUHIXVDODQGLQ SXQLVKPHQWWLHGKHUXSDQGSODFHGKHURQDVPDOOVKLSWKDWZDVVHW RQILUHDWVHD$XVSLFLRXVZLQGVFDUULHGWKHVKLSQRUWKWR,VFKLD$ ORFDOZRPDQKDGUHFHLYHGDPHVVDJHIURPDQDQJHOZKRDSSHDUHGWR KHULQDGUHDPDQGRUJDQLVHGWKHLVODQGHUVWRPHHWWKHIXQHUDOERDW DQGEXU\WKHUHPDLQVRIWKH\RXQJPDUW\UZLWKIXOOKRQRXUV6RPH \HDUVODWHUWKHWKUHDWRISLUDWHUDLGVPDGHLWQHFHVVDU\WRWUDQVSRUW KHUUHPDLQVIURP,VFKLDWR1DSOHVZKHUHWKH\ZHUHSURPLQHQWO\ GLVSOD\HG DW WKH *UHHN ULWH FDWKHGUDO ZKLFK WRRN KHU QDPH7KH DUULYDO RI WKH IHPDOH VDLQW·V ERG\ E\ VHD LV D FRPPRQSODFH RI VRXWKHUQ,WDOLDQKDJLRJUDSK\UHIOHFWLQJERWKWKHP\WKRIWKHVLUHQ 3DUWKHQRSHDQGWKHELUWKRI9HQXV7KHWRZQRI/DFFR$PHQRRQ ,VFKLDUHHQDFWVWKHDUULYDORIWKHVDLQW·VUHOLFVIURPWKHVHDLQDQ DQQXDOIHVWLYDOKHOGRQ6DLQW5HVWLWXWD·VIHDVWGD\0D\$PRVDLF LQ WKH FDWKHGUDO GHGLFDWHG WR WKH VDLQW GHSLFWV 5HVWLWXWD DQG 6DQ *HQQDURZLWKWKH0DGRQQDDQG&KLOGHQWKURQHGXQGHUVFRULQJWKH ORFDOLPSRUWDQFHRIERWKVDLQWV0RUHLVNQRZQRI6DLQW3DWULFLD WKHQLHFHRI(PSHURU&RQVWDQV,,7RDYRLGDQDUUDQJHGPDUULDJH VKHIOHGIURP&RQVWDQWLQRSOHWR1DSOHVDFFRPSDQLHGE\KHUQXUVH $JDOLVL3DWULFLDZDVDYHU\GHYRXW&KULVWLDQZKRDOZD\VWUDYHOOHG ZLWKDVSHFLDOUHOLFDQDLOIURPWKH+RO\&URVV7KHQDLOZDVVDLGWR

,17+(6+$'2:2)9(689,86

SRVVHVVPLUDFXORXVSRZHUVDQGEHFRPHEORRGUHGLQFRORXUHYHU\ *RRG)ULGD\6DGO\3DWULFLDGLHGIROORZLQJDEULHILOOQHVVGXULQJKHU YLVLWWR1DSOHVDQGZDVEXULHGLQWKHFLW\DWDPRQDVWHU\ORFDWHG RQKLJKJURXQGZKLFKVXIIHUHGIURPDSHUHQQLDOZDWHUVKRUWDJH 6KRUWO\ DIWHU KHU GHDWK 3DWULFLD DSSHDUHG WR$JDOLVL LQ D GUHDP DQG LQVWUXFWHG KHU WR H[FDYDWH LQ WKH JDUGHQ RI WKH PRQDVWHU\ ZKHUHDVSULQJRIIUHVKDQGFOHDUZDWHUVXGGHQO\JXVKHGIRUWK,Q WKDQNVJLYLQJIRUWKLVPLUDFOH$JDOLVLIRXQGHGDFRQYHQWLQ3DWULFLD·V QDPHLQWKDQNVJLYLQJIRUWKHPLUDFOHRIWKHZHOOZKHUH3DWULFLD·V PLUDFXORXVQDLOLVVWLOOYHQHUDWHGWRGD\2QWKHVDLQW·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¶OHDIHDWHUV· 8QWLO SDVWD EHFDPH WKHLU VWDSOHIRRGLQWKHVL[WHHQWKFHQWXU\LWLVSUREDEOHWKDWFDEEDJHVDQG RWKHUJUHHQVZHUHJURZQDVVWDSOHVLQWKHDEXQGDQWORFDOPDUNHW

0(',(9$/1$3/(6

JDUGHQV %\ WKH VL[WK FHQWXU\ WKH GLVWLQFW 1HDSROLWDQ WHUULWRU\ FRPSULVHG&XPDH0LVHQR3R]]XROL$FHUUD$WHOOD1ROD6RUUHQWR DQG6DOHUQR$QXPEHURIVHWWOHPHQWVOD\LQWKHDUHDRI&DSRGLFKLQR WKHIHUWLOHODQGDERYHWKHULGJHWRWKHQRUWKHDVWRI1DSOHVZKLFK RYHUORRNHGWKHPDUVKHVDQGIODWODQGVVORSLQJGRZQWRWKHVHD7R WKH ZHVW OD\ WKH¶PRXQWDLQ WRS·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·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¦

6WHSKHQ ,, ZDV WKH ODVW GXNH RI %\]DQWLQH 1DSOHV DQG WKH ILUVW LQGHSHQGHQW GXNH RI DXWRQRPRXV 1DSOHV 6WHSKHQ OLYHG LQ WKH

,17+(6+$'2:2)9(689,86

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·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¶1($32/,6· LQ *UHHNFDSLWDOVRQWKHRWKHUDQLQGLFDWLRQWKDWWKH*UHHNODQJXDJH ZDVVWLOOEHLQJXVHGLQ1DSOHVDWOHDVWIRUDGPLQLVWUDWLYHSXUSRVHV 1HDSROLWDQ FRLQV RI WKLV SHULRG GLUHFWO\ PRGHOOHG RQ %\]DQWLQH FRLQDJH PD\ LQGLFDWH FRQWLQXHG HFRQRPLF OLQNV DQG DQ DWWHPSW WRLPLWDWHPRQHWDU\SROLF\$VVKLSEXLOGLQJFHUDPLFVDQGWH[WLOHV LQGXVWULHV H[SDQGHG WKH ORFDO HFRQRPLF VWUXFWXUH PRYHG IURP VXEVLVWHQFHIDUPLQJWREDVLFXUEDQPDQXIDFWXUH%\WKHWHQWKFHQWXU\

0(',(9$/1$3/(6

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·V OLEUDU\LQFOXGHGFODVVLFDOZRUNVDQGUHOLJLRXVWH[WV3DXO:DUQHIULG D%HQHGLFWLQHPRQNEHWWHUNQRZQDV3DXOWKH'HDFRQLVWKHJUHDWHVW 1HDSROLWDQZULWHURIWKHSHULRG+HZURWHWZRUHQRZQHGKLVWRULHV WKH+LVWRULD5RPDQDDQGWKH+LVWRULD/DQJREDUGRUXPZKLFKDUHFODVVLFV RI0HGLHYDO/DWLQOLWHUDWXUH3DXOZDVDOVRWKHDXWKRURIDIDPRXV K\PQGHGLFDWHGWR6DLQW-RKQWKH%DSWLVWZKLFKZDVXVHGE\RQHRI KLV%HQHGLFWLQHEURWKHUV*XLGRG·$UH]]RDVWKHEDVLVIRUWKHILUVW DEVROXWH¶GRUHPL·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ÀQLTXHNLFRQWHQHWUHQWDDQQLOHSRVVHWWHSDUWH6DQFWL%HQHGLFWL¶,NQRZ

,17+(6+$'2:2)9(689,86

WKDWWKHODQGVZLWKWKHERUGHUVKHUHLQGLFDWHGKDYHEHHQRZQHGE\ WKH%HQHGLFWLQHVIRUWKLUW\\HDUV· ,QWKHQLQWKFHQWXU\WKH$UDEVRI1RUWK$IULFDFDSWXUHG6LFLO\ IURPWKH%\]DQWLQHVDQGEHJDQWRIRUPFRPPHUFLDODQGGLSORPDWLF WLHVZLWK1DSOHV7KH$UDEVKHOSHG1DSOHVKROGRIIWKH/RPEDUGV DQGLQUHWXUQWKH1HDSROLWDQIOHHWDVVLVWHGWKH$UDEVZKHQWKH\ WRRN WKH FLW\ RI %DUL RQ WKH$GULDWLF FRDVW ZKLFK ZDV WR UHPDLQ D0XVOLPVWURQJKROGIRU\HDUV7KLVDOOLDQFHIXUWKHUZHDNHQHG %\]DQWLQHVHDSRZHULQWKH7\UUKHQLDQ+RZHYHUWKHUHODWLRQVKLS EHWZHHQWKH1HDSROLWDQVDQGWKH$UDEVZDVDQXQHDV\DOOLDQFH$V WKH$UDEVLQFUHDVHGWKHLULQIOXHQFHLQ6RXWKHUQ,WDO\WKH1HDSROLWDQV EHJDQWRVHHWKHPDVDWKUHDW,Q $'WKH1HDSROLWDQJHQHUDO &HVDULXV OHG D FRDOLWLRQ RI IRUFHV LQFOXGLQJ WURRSV IURP 5RPH %\]DQWLXP DQG RWKHU PDMRU FHQWUHV RI 6RXWKHUQ ,WDO\ DJDLQVW WKH $UDEV+XQGUHGVRI¶6DUDFHQ7RZHUV·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

0(',(9$/1$3/(6

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·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·V PHUFKDQWVDQGVHDIDUHUVWKDWLWLVQRVXUSULVHWROHDUQWKDWDORFDO

,17+(6+$'2:2)9(689,86

UHVLGHQW )ODYLR *LRLD LQYHQWHG WKH FRPSDVV SUREDEO\ ZRUNLQJ IURP HDUOLHU $UDE PRGHOV DQG ODZ\HUV IURP $PDOIL HVWDEOLVKHG WKH ILUVW PDULWLPH FRGH WKH 7DYROH $PDOÀWDQH ZKLFK UHJXODWHG 0HGLWHUUDQHDQWUDGHXQWLOWKHVODWHUVHUYLQJDVWKHIRXQGDWLRQ IRUPRGHUQPDULWLPHODZ$PDOILUHWDLQHGLWVSURPLQHQWSRVLWLRQ RQO\VRORQJDVLWVOLPLWHGUHVRXUFHVDOORZHGLWWRPDQDJHDUHODWLYHO\ ODUJHVKDUHRIWKHFRPPHUFLDOWUDIILFLQWKH0HGLWHUUDQHDQ$VWUDIILF DQGH[FKDQJHLQFUHDVHG$PDOIL·VVKDUHGHFOLQHGSURSRUWLRQDOO\DQG KHUSRZHUDQGVLJQLILFDQFHZDQHG 7KHWLQ\UHSXEOLFRI$PDOILKDGGHYHORSHGLQWRDJUHDWPDULWLPH UHSXEOLF \HW FHQWXULHV ODWHU 1DSOHV SUHYDLOHG:DV LW EHFDXVH RI LWVFRPPHUFLDOEDVHLWVPHUFKDQWIOHHW²RUSHUKDSV9LUJLO·VPDJLF HJJ"/HJHQGKDVLWWKDWWKH5RPDQSRHW9LUJLOKLGDQHJJLQDVHFUHW ORFDWLRQ LQ WKH FDVWOH RQ WKH LVODQG RI 0HJDULV NQRZQ DV &DVWHO GHOO·2YR WKH (JJ &DVWOH7KH GHVWLQ\ RI WKH FDVWOH WRJHWKHU ZLWK WKDWRIWKHHQWLUHFLW\RI1DSOHVLVOLQNHGWRWKHHJJ$VORQJDVWKH HJJLVVDIHWKHFLW\RI1DSOHVLVVDLGWREHSURWHFWHGE\9LUJLO·VPDJLF SRZHUV5HIHUHQFHVWRDPHVVLDQLFILJXUHD\RXQJER\ZKRZRXOG FKDQJHWKHFRXUVHRIWKHZRUOGDUHFRQWDLQHGLQ9LUJLO·VSURSKHWLF (FORJXH,97KLVZDVWRJLYHULVHLQWKH0LGGOH$JHVWR9LUJLO·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
0(',(9$/1$3/(6

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¦

6ORZO\ EXW VXUHO\ OLNH WKHLU FRXVLQV LQ (QJODQG WKH 1RUPDQV FRQTXHUHG DQG XQLWHG WKH VRXWK RI ,WDO\ HOLPLQDWLQJ QRW RQO\ WKH /RPEDUG SULQFLSDOLWLHV DQG YDULRXV LQGHSHQGHQW GXFKLHV EXW DOVR WKH WZR GRPLQDQW IRUHLJQ SRZHUV WKH %\]DQWLQHV LQ &DODEULD DQG $SXOLDDQGWKH$UDEVLQ6LFLO\7KHQHZ1RUPDQ.LQJGRPRI6LFLO\ ZDVODWHUH[WHQGHGWRLQFOXGHDOORI6RXWKHUQ,WDO\XSWRWKHERUGHU ZLWK WKH 3DSDO 6WDWHV 1DSOHV ZDV WKH ILQDO LQGHSHQGHQW VWDWH RI 6RXWKHUQ,WDO\WRIDOOWRWKH1RUPDQVZKHQ6HUJLR9,,WKHODVW'XNHRI 1DSOHVGLHGLQEDWWOH,Q6HSWHPEHU$'5RJHU,,GH+DXWHYLOOH HQWHUHG1DSOHV7KH1RUPDQVZHUHWROHUDQWRIRWKHUUHOLJLRQVDQG DVVLPLODWHG/DWLQ*UHHNDQG$UDEFXOWXUHV,QFUHDVLQJO\LQFRPPRQ SDUODQFH WKH RIILFLDO QDPH RI WKH NLQJGRP ZDV WUDQVIRUPHG LQWR ¶.LQJGRP RI WKH7ZR 6LFLOLHV· WR GLIIHUHQWLDWH EHWZHHQ WKH LVODQG LWVHOIDQGWKHVRXWKHUQSRUWLRQRIWKH,WDOLDQSHQLQVXODDOWKRXJKWKH FDSLWDO UHPDLQHG LQ 3DOHUPR7KH SROLWLFDO LPSRUWDQFH RI 1DSOHV UDSLGO\GLPLQLVKHG,WVORVVRISUHVWLJHLVLQGLFDWHGE\WKHIDFWWKDW .LQJ5RJHUPDGHKLVILUVWERUQVRQ'XNHRI$SXOLDDQGKLVVHFRQG VRQ3ULQFHRI%DULEXWRQO\KLVWKLUGVRQ$OSKRQVHZDVDZDUGHG WKHPLQRUKRQRXURI1DSOHV7KH(JJ&DVWOHEHFDPHWKHFHQWUHRI

,17+(6+$'2:2)9(689,86

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·W DEDQGRQ \RXUVHOI WR DQJHU'ULQNDQGHDWZLWKPRGHUDWLRQDQDIWHUQRRQZDONZLOOQRWGR \RXDQ\KDUP$YRLGVOHHSLQJLQWKHDIWHUQRRQGRQ·WKROGRQWR\RXU XULQHDQGGRQ·WXVHIRUFHLQFRPSUHVVLQJ\RXUDQXV,I\RXREVHUYH WKHVHUXOHVZLWKFDUH\RXZLOOOLYHDORQJDQGKHDOWK\OLIH

DQGZLVHO\¶8VHWKHVHWKUHHSULQFLSOHVDV\RXUGRFWRUKDSS\PLQG UHVWPRGHUDWHGLHW·

0(',(9$/1$3/(6

7KH VFKRRO DOVR KRVWHG D JURXS FDOOHG WKH¶/DGLHV RI 6DOHUQR· IRUHPRVWRIZKRPZDV'DPH7URWZKRQRWRQO\OHFWXUHGEXWDOVR ZURWHLPSRUWDQWHDUO\WH[WVRQZRPHQV·KHDOWKLVVXHV+HUPRVW IDPRXVZRUNLV'HPXOLHUXPSDVVLRQLEXVDQWHHWSRVWSDUWXPLQZKLFK VKHSURYLGHVUXOHVIRUZRPHQ·VKHDOWKJRRGFDUHGXULQJSUHJQDQF\ DQG DGYLFH RQ FDULQJ IRU VPDOO FKLOGUHQ 6KH HYHQ GLVFXVVHV VXFK PRGHUQ WRSLFV DV UHODWLRQVKLSV FRQWUDFHSWLRQ DQG FXUHV IRU LQIHUWLOLW\ 'DPH7URW DOVR SURGXFHG D WUHDWLVH RQ FRVPHWLFV DQG GHUPDWRORJ\'HRUQDWXPXOLHUXPLQZKLFKVKHGLVSHQVHGDGYLFHRQ VNLQFDUHKDLUFRORXULQJDQGPDNHXS 5RJHUGH+DXWHYLOOHZDVVXFFHHGHGE\:LOOLDPWKH%DGDQG:LOOLDP WKH*RRGLQUDSLGVXFFHVVLRQ$IWHUWKHGHDWKRIWKHODVW1RUPDQ NLQJWKHFURZQSDVVHGWRWKHSUHWHQGHUWRWKH+RO\5RPDQ(PSLUH +HQU\9,+RKHQVWDXIHQKXVEDQGRID1RUPDQSULQFHVV&RQVWDQFH RI$OWDYLOOD+HQU\EURXJKW,WDO\FHQWUHVWDJHLQWRWKHSRZHUVWUXJJOHV RIPHGLHYDO(XURSHDQGSDSDORSSRVLWLRQWR+RKHQVWDXIHQUXOHZDV WRGUDZPRVWRI(XURSHLQWRWKHIUD\7KH+RO\5RPDQ(PSLUHZDV WKHILUVWJUHDWQRUWKHUQSRZHUEDVHLQ(XURSHDSUHFXUVRUWRVHYHUDO PRGHUQ (XURSHDQ QDWLRQVWDWHV LQFOXGLQJ )UDQFH DQG *HUPDQ\ ,Q $')UHGHULFN,,RI+RKHQVWDXIHQVXFFHHGHGWRWKHWKURQH DQGDWWKHDJHRIWKUHHKHEHFDPHERWK+RO\5RPDQ(PSHURUDQG .LQJRI6LFLO\7KH&KXUFKYV6WDWHHQPLW\W\SLILHGE\WKHSROLWLFDO ULYDOU\ RI WKH¶*XHOSK· DQG¶*KLEHOOLQH· IDFWLRQV RI WKH IRXUWHHQWK FHQWXU\ EURXJKW WKH HQWLUH ,WDOLDQ SHQLQVXOD LQWR WKH GHEDWH RYHU WKHVXSUHPDF\RIWHPSRUDORUVSLULWXDOSRZHU$OWKRXJK)UHGHULFN ZDVRI*HUPDQ LPSHULDO EORRG WKURXJK WKH PDOH OLQH KLV PRWKHU ZDVD1RUPDQSULQFHVVDQGKHZDVEURXJKWXSLQ6LFLO\,WDO\QRW *HUPDQ\ZDVKLVJUHDWHVWFRQFHUQDQGWKHVRXWKZDVKRPHWRKLV IDPLO\$OWKRXJKWKHFRXUWZDVEDVHGLQ3DOHUPR)UHGHULFNSUHIHUUHG 1DSOHVIRUJHRSROLWLFDOUHDVRQV,WZDVFORVHUWRKLVODQGVLQ*HUPDQ\ DQGQHDUHUWKHERUGHUZLWKKLVQHLJKERXUWKH3RSH

,17+(6+$'2:2)9(689,86

)UHGHULFNZDVDOHDUQHGPDQNQRZQIRUKLVHUXGLWHFRUUHVSRQGHQFH RQSKLORVRSKLFDODQGVFLHQWLILFPDWWHUVZLWK$UDEVFKRODUVDQGIRUWKLV UHDVRQKHZDVNQRZQDVVWXSRUPXQGLWKHZRQGHURIWKHZRUOG7KH JUHDW,WDOLDQPDWKHPDWLFLDQ/HRQDUGR)LERQDFFLZDVDSURPLQHQW PHPEHURIWKHFRXUWLQ3DOHUPRDQGLQWURGXFHG$UDELFQXPHUDOV LQWR(XURSH7UDQVODWRUVDWWKH6LFLOLDQFRXUWSURGXFHG/DWLQYHUVLRQV RI WKH SKLORVRSKLFDO ZRUNV RI$YLFHQQD DQG$YHUURsV SDUWLFXODUO\ WKH ODWWHU·V FRPPHQWDULHV RQ $ULVWRWOH DV ZHOO DV /DWLQ YHUVLRQV RI 3WROHP\·V $OPDJHVW DQG WKH ZRUNV RI WKH$UDE DVWURQRPHU$O )DUJKLQL7KHJUHDWHVWPLQGVRIWKHGD\IORFNHGWR)UHGHULFN·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oDO SRHWU\ LQ ZKLFK WKH REMHFWRIORYHLVDOZD\VDEHDXWLIXOLQDFFHVVLEOHDQGQREOHZRPDQ ZKRLVRIWHQFRPSDUHGWRDSHUIXPHGURVHRUDOXPLQRXVVWDU7KLV SRHPLVUHSXWHGWRKDYHEHHQZULWWHQE\)UHGHULFNKLPVHOILQWKH QHZO\HPHUJHQWYHUQDFXODU 6HFRQGRPLDFUHGHQ]DQRQqGRQQDFKHVLD $OWDVLEHOODSDUH 1pF·DJLDLQVHJQDPHQWR ¶QYHUYRLGRQQDVRYUDQD /DYRVWUDFLHUDXPDQD PLGjFRQIRUWRHIDFHPLDOHJUDUH

0(',(9$/1$3/(6

V·HRSUHJLDUH²YLSRVVRGRQQDPLD SLFRQWRPLQHWHQJRWXWWDYLD ,GRQRWEHOLHYHWKHUHLVDQ\ZRPDQDOLYHZKRFDQPDWFK\RXUZRUWK DQGEHDXW\1RQHFDQFRPSDUHZLWK\RXIRUFRXUWHV\VRYHUHLJQODG\
7KH SRHWU\ RI WKH 6LFLOLDQ FRXUW ZDV D GLUHFW DQG LPSRUWDQW LQIOXHQFHRQWKHGROFHVWLOQXRYRRI'DQWH·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

,WLVDZRQGHUWKDW)UHGHULFNIRXQGDQ\WLPHDWDOOIRUHLWKHUKXQWLQJ RUOLWHUDWXUH+HZDVDQLQGHIDWLJDEOHVWDWHVPDQ7KH&RQVWLWXWLRQV RI 0HOÀ FRQWDLQLQJ RYHU ODZV DQG SURFODPDWLRQV RIIHUV WKH FOHDUHVW LQGLFDWLRQ RI )UHGHULFN·V GHVLUH WR PDNH KLV NLQJGRP DQ HIILFLHQW¶PRGHOVWDWH·LQZKLFKDOOULJKWVDQGREOLJDWLRQVDUHVXEMHFW WRWKHUXOHU·VZLOO7KHILUVWERRNLVGHGLFDWHGWRWKHRUJDQLVDWLRQRI WKHNLQJGRPZLWKSDUWLFXODUDWWHQWLRQSDLGWRWKHDGPLQLVWUDWLRQ RIMXVWLFHDQGWD[HV7KHVHFRQGERRNRXWOLQHVGXHSURFHVVDQGWKH WKLUGEULQJVWRJHWKHU&KULVWLDQMXVWLFHDQGWKHSULQFLSOHRIHTXDOLW\ EHIRUH WKH ODZ &HQWUDO JRYHUQPHQW ZDV UHLQIRUFHG DQG D VWDWH

,17+(6+$'2:2)9(689,86

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«:HKDYHWKHUHIRUH RUGHUHGWKDWLQWKHPRVWSOHDVLQJFLW\RI1DSOHVWKHDUWVEHWDXJKW DQGWKHVWXG\RIDOOSURIHVVLRQVEHWDXJKWVRWKDWWKRVHZKRVWDUYHDQG DUH KXQJU\ FDQ ILQG ZLWKLQ WKH .LQJGRP LWVHOI VDWLVIDFWLRQ IRU WKHLU GHVLUHVDQGDUHQRWREOLJHGLQRUGHUWRUHFHLYHLQVWUXFWLRQWRWDNH ORQJMRXUQH\VDQGEHJLQIRUHLJQODQGV

8QOLNH WKH RWKHU ,WDOLDQ XQLYHUVLWLHV RI WKH GD\ 3DGXD DQG %RORJQDWKLVZDVDVWULFWO\OD\LQVWLWXWLRQZLWKQRIRUPRISDSDO FRQWURO 2QH RI WKH PRVW LOOXVWULRXV VWXGHQWV RI WKH WKLUWHHQWK FHQWXU\7KRPDV$TXLQDVVWXGLHGDWWKHQHZ8QLYHUVLW\RI1DSOHV DQGLVWRGD\NQRZQDVWKHSDWURQVDLQWRIXQLYHUVLWLHVDQGXQLYHUVLW\ VWXGHQWV 7KRPDV· FODVVPDWHV PLVXQGHUVWRRG WKH \RXQJ PDQ·V KXPLOLW\DQGUHVHUYHGQDWXUHDQGHUURQHRXVO\UHIHUUHGWRKLPDV ¶WKH'XPE2[·8SRQKHDULQJ7KRPDV·WKHRORJLFDODUJXPHQWVKLV SURIHVVRULVVDLGWRKDYHGHFODUHG¶:HFDOOWKLV\RXQJPDQDGXPE R[EXWKLVEHOORZLQJLQGRFWULQHZLOORQHGD\UHVRXQGWKURXJKRXW WKHZRUOG·7KRPDVJUDGXDWHGIURPWKHXQLYHUVLW\DQGZDVRUGDLQHG

0(',(9$/1$3/(6

LQ $' DV D SULHVW LQ WKH 'RPLQLFDQ RUGHU EHIRUH JRLQJ RQ WRIXOILOWKHVHSURSKHWLFZRUGV7KRPDV·ZRUNLVRQHRIWKHFKLHI VRXUFHV RI PRGHUQ &DWKROLF WKHRORJ\ DQG ZDV RQH RI WKH PRVW VLJQLILFDQWFXOWXUDODFKLHYHPHQWVRIWKH1RUPDQSHULRGLQ1DSOHV +HFKDOOHQJHGWKHUHFHLYHGGRFWULQHVRIWKH&DWKROLF&KXUFKZKLFK XQWLOWKHQKDGEHHQEDVHGSULPDULO\RQWKHZRUNVRI3ODWRWKURXJK KLVRZQVFKRODUO\UHDSSUDLVDORIDQFLHQWVFKRODUVKLSVKDSHGE\KLV VWXG\RI$ULVWRWOH$OWKRXJK7KRPDVGLGQRWGHQ\*RG·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

,17+(6+$'2:2)9(689,86

'RZQ LQ DGRUDWLRQ IDOOLQJ /R WKH VDFUHG +RVW ZH KDLO /R 2·HU DQFLHQWIRUPVGHSDUWLQJQHZHUULJKWVRIJUDFHSUHYDLO)DLWKIRUDOO GHIHFWVVXSSO\LQJZKHUHWKHIHHEOHVHQVHVIDLO7RWKHHYHUODVWLQJ)DWKHU DQGWKH6RQZKRUHLJQVRQKLJKZLWKWKH+RO\6SLULWSURFHHGLQJIRUWK IURPHDFKHWHUQDOO\EHVDOYDWLRQKRQRXUEOHVVLQJPLJKWDQGHQGOHVV PDMHVW\

7KHVH QRZ IDPRXV ZRUGV KDYH EHHQ VHW WR PXVLF E\ FODVVLFDO FRPSRVHUV VXFK DV 0R]DUW 6FKXEHUW %HUOLR] DQG %UXFNQHU DV ZHOODVFRQWHPSRUDU\PXVLFLDQVVXFKDVWKH$PHULFDQ%HDO7KRPDV 7KXVWRJHWKHUZLWKKLVPDQ\RWKHUDFKLHYHPHQWV7KRPDV$TXLQDV PXVWDOVREHDZDUGHGWKHDFFRODGHRIFRPSRVLQJWKHILUVWDQGPRVW HQGXULQJ1HDSROLWDQVRQJ $IWHU )UHGHULFN·V GHDWK KLV VRQ 0DQIUHG·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·VOHJDOKHLUOLYHGLQ*HUPDQ\EXWZLWKLQD\HDU DJHGRQO\KHZDVRQKLVZD\WR,WDO\WRFODLPKLVELUWKULJKW7KH DUPLHVPHWLQDGHFLVLYHEDWWOHDW7DJOLDFR]]R&RQUDGLQZDVWDNHQ SULVRQHUDQGEURXJKWWR1DSOHVZKHUHKHZDVSXEOLFO\H[HFXWHGVR WKDWKHFRXOGQRWSURYLGHDUDOO\LQJSRLQWIRUWKH,WDOLDQ*KLEHOOLQHV 7KH*XHOSKYLFWRU\XQGHUVFRUHGWKHLPSRUWDQWUROHRIWKH&KXUFK LQ1DSOHV·FLYLFLGHQWLW\

0(',(9$/1$3/(6

7 K H$QJHYLQ0RQDUFK\ $ ' ¦

&KDUOHV RI$QMRX ZDV FURZQHG .LQJ RI WKH7ZR 6LFLOLHV E\ 3RSH &OHPHQW,9DQGWKHIRUWXQHVRI1DSOHVLPSURYHGGUDPDWLFDOO\ZKHQ WKH$QJHYLQV FKRVH WR PDNH LW WKHLU FDSLWDO UDWKHU WKDQ 3DOHUPR 7KLV DOORZHG .LQJ &KDUOHV WR EH FORVHU WR KLV ODQGV LQ 3URYHQFH DQG FRQIHUUHG JUHDW SUHVWLJH RQ 1DSOHV SODFLQJ LW RQ DQ HTXDO IRRWLQJZLWKRWKHU(XURSHDQUR\DOFDSLWDOVDVDFHQWUHIRUWUDGHDQG GLSORPDF\ ,Q UHFRJQLWLRQ RI WKH 3RSH·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¶.LQJGRPRI 6LFLO\·WKHVWDWHZDVVRRQUHIHUUHGWRLQFRPPRQSDUODQFHDVWKH ¶.LQJGRPRI1DSOHV·

,17+(6+$'2:2)9(689,86

8QGHUVWDQGDEO\ WKHUH ZDV GLVLOOXVLRQPHQW LQ 6LFLO\ IROORZLQJ 3DOHUPR·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·VUHLJQZDVVSHQWWU\LQJ²XQVXFFHVVIXOO\²WRUHFRQTXHU WKHLVODQG ,Q 0D\ WKH *UDQG $GPLUDO RI 6LFLO\ 5RJHU RI /DXULD DSSURDFKHGWKH%D\RI1DSOHVZLWKKLVIOHHW.LQJ&KDUOHVZDVLQ 3URYHQFHDQGIRUEDGHKLVVRQWKHIXWXUH&KDUOHV,, IURPDWWDFNLQJ WKHHQHP\,JQRULQJKLVIDWKHU·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

0(',(9$/1$3/(6

VLVWHURI4XHHQ&RQVWDQFHRI6LFLO\ZKRKDGEHHQORFNHGLQWKH(JJ &DVWOHIRUDOPRVW\HDUV:KHQ.LQJ&KDUOHVUHWXUQHGWR1DSOHV KHZDVIXULRXVZLWKKLVVRQIRUKDYLQJFDXVHGVRPXFKWURXEOH,QD ILWRISDWHUQDOUDJHKHLVDOOHJHGWRKDYHVFUHDPHG¶:KRORVHVDIRRO ORVHVQRWKLQJZK\LVKHQRWGHDGIRUGLVREH\LQJPH"·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¶$QJHYLQIRUWUHVV·,WLVDOVRNQRZQ DVWKH¶1HZ&DVWOH·WRGLVWLQJXLVKLWIURPWKH(JJ&DVWOHDQGWKH &DVWHO&DSXDQD %XLOWLQOLWWOHPRUHWKDQIRXU\HDUVWKHUHFWDQJXODU FDVWOH ZLWK D PRDW DQG WXUUHWV VWLOO SUHVLGHV RYHU WKH SRUW DUHD 7KHVXUURXQGLQJDUHDZDVVRRQRFFXSLHGE\WKHUHVLGHQFHVRIWKH DULVWRFUDF\DQGFRXUWLHUV*ROGVPLWKVEDQNHUVDQGRWKHUEXVLQHVVHV ZHUHDOVRORFDWHGDURXQGWKHQHZUR\DOUHVLGHQFH7RWKLVGD\WKH DUHD VXUURXQGLQJ WKH 0DVFKLR $QJLRLQR UHPDLQV D FRPPHUFLDO DGPLQLVWUDWLYHDQGEDQNLQJGLVWULFW%XLOGLQJDOVRWRRNSODFHRQWKH

,17+(6+$'2:2)9(689,86

KLOOVRYHUORRNLQJWKHQHZFDVWOH7KH&KDUWHUKRXVHRI6DLQW0DUWLQ DQG WKH 6DLQW (OPR &DVWOH FDPH WR GRPLQDWH WKH FLW\·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¶:HOOKDVWWKRXZULWWHQFRQFHUQLQJPH7KRPDV:KDWVKDOO,JLYH WKHHDVDUHZDUG"·7KRPDVKXPEO\UHSOLHG¶1DXJKWVDYHWK\VHOI2 /RUG·7KH&KXUFKRI6DQ/RUHQ]RZDVDOVRFRPPLVVLRQHGE\WKH $QJHYLQVDQGGHVLJQHGE\)UHQFKDUFKLWHFWV7KHH[TXLVLWHGHOLFDWH FHLOLQJRIWKHFKRLULVDQH[DPSOHRISXUH)UHQFK*RWKLFVW\OH:RUNV ZHUHDOVRFRPPLVVLRQHGIRUWKHUHFRQVWUXFWLRQRIWKHFDWKHGUDO7KH FKDSHOGHGLFDWHGWR6DQ*HQQDURZDVUHGHFRUDWHGIRUWKHWK DQQLYHUVDU\RIKLVGHDWKLQ&KDUOHV,,FRPPLVVLRQHG)UHQFK DUWLVWVWRFUHDWHDVLOYHUUHOLTXDU\EXVWWRFRQVHUYHWKHVNXOORI6DQ *HQQDUR,WZDVWREHWKHMHZHORIWKHQHZFDWKHGUDO &KDUOHVWKHLPSHWXRXV\RXQJSULQFHZKRKDGLQFXUUHGKLVIDWKHU·V ZUDWKVXFFHHGHGKLPWRWKH$QJHYLQWKURQHRI1DSOHVDQGPDUULHG 0DULD RI +XQJDU\ WKH GDXJKWHU RI .LQJ 6WHSKHQ9 DQG ODVW KHLU

0(',(9$/1$3/(6

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·V UREHV FURZQLQJ KLV \RXQJHU EURWKHU 5REHUWDV.LQJRI1DSOHV /RXLV·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

,17+(6+$'2:2)9(689,86

RIWKHKDYRFZUHFNHGE\WKH9HVSHUZDUV&KDUOHV,,·VJRYHUQPHQW ZDV PDQDJHG E\ %DUWKRORPHZ GL &DSXD ZKR ZDV DOVR FKLHI DGPLQLVWUDWRUIRUWKHNLQJ·VVRQDQGVXFFHVVRU5REHUW8QGHUWKH $QJHYLQVWKHHDUOLHVWWUDGHDQGSURIHVVLRQDOJXLOGVZHUHRIILFLDOO\ UHFRJQLVHGE\WKHFLYLFJRYHUQPHQW1DSOHVZDVQRWRQO\WKHUR\DO FDSLWDOLWZDVDOVRWKHNLQJGRP·VSULQFLSDOSRUWDQGWKHPHUFDQWLOH DQGILQDQFLDOFHQWUH0LQGIXORIKLV\RXWKIXOH[SHULHQFHV&KDUOHV ,,FRQWLQXHGWRILJKWIRUWKHUHFRYHU\RI6LFLO\XQWLOZKHQKH UHOXFWDQWO\FDPHWRWHUPVZLWKWKHIDFWWKDWKHKDGGHILQLWLYHO\ORVW WKHLVODQGDQGDJUHHGWRWKHSHDFHRI&DOWDEHOODWDUHQRXQFLQJKLV ULJKWVWR6LFLO\IRUHYHU7KXV5REHUWLQKHULWHGDNLQJGRPIUHHRI FRQIOLFW DOEHLW VRPHZKDW VPDOOHU WKDQ KLV IDWKHU DQG JUDQGIDWKHU PLJKWKDYHKRSHG 1RQHWKHOHVV5REHUW·VUHLJQLVJHQHUDOO\UHJDUGHGDVVXFFHVVIXO *LRYDQQL9LOODQLSUDLVHGKLPDV¶WKHZLVHVW&KULVWLDQRIWKHODVWILYH KXQGUHG\HDUV·DQGWKH¶SHDFHPDNHURI,WDO\·*LRYDQQL&RQYHUVLQLRI 5DYHQQDZURWHWKDW¶.LQJ5REHUWHQFRXUDJHGGRFWRUVWKHRORJLDQV SRHWV DQG RUDWRUV ZLWK SUROLILF KRQRXUV DQG DEXQGDQW ODUJHVVH $OO LQ WKH ZRUOG ZKR VRXJKW WKH UHZDUGV RI WKH VWXG\ RI OHWWHUV SRXUHGLQWRKLVNLQJGRPDQGQRWLQYDLQIRULWOD\RSHQDVDVDFUHG GRPLFLOHRIVFKRODUV·8QGHU5REHUWNQRZQDV¶WKH:LVH·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

0(',(9$/1$3/(6

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

,17+(6+$'2:2)9(689,86

ZLWKILVK7KHNLQJLVGHVFULEHGHQMR\LQJDQHOHJDQWEXWUHOD[HGPHDO ZLWKH[TXLVLWHFRRNLQJDQGZLQHVRIUDUHH[FHOOHQFH7KHURPDQFH EHWZHHQ%RFFDFFLRDQGKLV1HDSROLWDQORYHU)LDPPHWWDLVRQHRI WKHPRVWUHQRZQHGORYHVWRULHVRIWKH0HGLHYDOSHULRG)LDPPHWWD PD\ KDYH EHHQ D ORYH FKLOG RI .LQJ 5REHUW KLPVHOI ZKR DV D \RXQJPDQKDGDURYLQJH\H'XULQJWKH(DVWHUVHUYLFHVLQ %RFFDFFLRZDVZRUVKLSSLQJDWWKH&KXUFKRI6DQ/RUHQ]RZKHQKH ILUVWVDZWKHZRPDQZKRZRXOGGHILQHKLVOLIHDQGKLVZULWLQJKLV ORYHUDQGPXVH)LDPPHWWD%RFFDFFLRGHVFULEHVWKHLUILUVWPHHWLQJ LQUDSWXURXVGHWDLO ,IRXQGP\VHOILQDJUDFLRXVDQGEHDXWLIXOFKXUFKLQ3DUWKHQRSHQDPHG DIWHU KH ZKR WR PDNH KLPVHOI LPPRUWDO HQGXUHG WR EH RIIHUHG RQ WKHJULGLURQ,ZDVOLVWHQLQJWRWKHRIILFHZKLFKLVVXQJRQWKDWGD\ FHOHEUDWHGE\SULHVWVVXFFHVVRUVWRKLPZKRILUVWJLUWKLPVHOIKXPEO\ ZLWKWKHFRUGH[DOWLQJSRYHUW\DQGDGRSWLQJLWDVKLVRZQ1RZZKLOH ,VWRRGWKHUHWKHIRXUWKKRXURIWKHGD\DFFRUGLQJWRP\UHFNRQLQJ KDYLQJDOUHDG\SDVVHGGRZQWKHHDVWHUQVN\WKHUHDSSHDUHGWRP\H\HV WKHPDUYHOORXVEHDXW\RID\RXQJZRPDQFRPHKLWKHUWRKHDUZKDW ,WRRKHDUGDWWHQWLYHO\,KDGQRVRRQHUVHHQKHUWKDQP\KHDUWEHJDQ WRIOXWWHUVRVWURQJO\WKDWLWZDVDVLI,FRXOGIHHOLWWKUREELQJLQWKH VPDOOHVWSXOVHVRIP\ERG\DQGQRWNQRZLQJZK\QRW\HWIHHOLQJZKDW DOUHDG\FDQEHLPDJLQHGZDVWRFRPHIURPWKLVQHZYLVLRQ,EHJDQWR VD\¶2KZKDWLVWKLV"·«,KDGQRVRRQHUVDLGWKHVHZRUGVZKHQWKH IODVKLQJH\HVRIWKHORYHO\ODG\ORRNHGLQWRPLQHVFLQWLOODWLQJZLWKD SLHUFLQJOLJKW

,Q WKH VRSKLVWLFDWHG DQG FDUHIUHH FRXUWO\ FLUFOHV RI 1DSOHV LW ZDV KHOG WKDW WKHUH ZHUH IRXU TXDOLWLHV QHFHVVDU\ IRU WKH SHUIHFW HQMR\PHQW RI FDUQDO ORYH LW PXVW EH VHQVXDO LOOLFLW VZHHW DQG GLIILFXOW )LDPPHWWD DQG %RFFDFFLR ZHUH QRW WR EH GLVDSSRLQWHG 6XFK ZDV %RFFDFFLR·V SDVVLRQ IRU KLV PXVH WKDW VKH DSSHDUV DV D FKDUDFWHULQPDQ\RIKLVOLWHUDU\ZRUNVWKH)LORFRORWKH7HVHLGDWKH

0(',(9$/1$3/(6

&RPPHGLDGHOOH1LQIH)LHVRODQHWKH$PRURVDYLVLRQHDQGWKH(OHJLDGL 0DGRQQD)LDPPHWWDLQZKLFKVKHSRXUVRXWKHUKHDUWWRKHUQXUVH DERXWWKHWULDOVDQGWULEXODWLRQVRIORYH)LDPPHWWDLVDOVRRQHRIWKH WHQVWRU\WHOOHUVLQWKH'HFDPHURQ %RFFDFFLR·V FRQWHPSRUDU\ )UDQFLV 3HWUDUFK ZDV WKH JUHDWHVW SRHW RI KLV DJH:KHQ 3HWUDUFK ZDV QRPLQDWHG SRHW ODXUHDWH E\ WKH 5RPDQ 6HQDWH KH GHFODUHG WKDW KH ZRXOG RQO\ DFFHSW WKH SUHVWLJLRXVDZDUGIURPWKH.LQJRI1DSOHV3HWUDUFKZDVUHFHLYHG LQWKH0DVFKLR$QJLRLQRE\.LQJ5REHUWLQ ,GHFLGHGWRYLVLW1DSOHVILUVWDQGSUHVHQWP\VHOIWRWKDWGLVWLQJXLVKHG SKLORVRSKHU.LQJ5REHUW²LOOXVWULRXVLQOHWWHUVDVZHOODVLQUDQNWKH RQO\PRQDUFKRIRXUWLPHZKRORYHGOHDUQLQJDQGYLUWXH²WRVHHKRZ KHZRXOGMXGJHPH,VWLOOZRQGHUDWKLVPRVWIODWWHULQJHVWLPDWHDQG KLVNLQGHVWRIZHOFRPHVDQGLI\RXZKRUHDGWKLVKDGH[SHULHQFHGWKHP \RXUVHOI\RXZRXOGEHQROHVVDPD]HG+HDULQJZK\,KDGFRPHKH ZDVVXUSULVHGDQGDOVRGHOLJKWHGFRQVLGHULQJWKDWP\\RXWKIXOWUXVWLQ KLP²SHUKDSVWRRWKHKRQRXUZKLFK,ZDVVHHNLQJ²ZRXOGFRQWULEXWH WRKLVRZQJORU\VLQFH,KDGVRXJKWKLPRXWDVEHLQJDORQHFRPSHWHQW WRMXGJH1HHG,VD\PRUH"$IWHUFRXQWOHVVGLVFXVVLRQV,VKRZHGKLP P\$IULFDDQGKHZDVVRSOHDVHGZLWKLWWKDWKHDVNHGPHWRGHGLFDWHLW WRKLPDVDSDUWLFXODUIDYRXUDUHTXHVW,FRXOGVFDUFHO\UHIXVH²QRWWKDW ,ZLVKHGWR(YHQWXDOO\KHIL[HGDGD\IRUP\H[DPLQDWLRQ+HNHSWPH IURPQRRQWRQLJKWGRLQJWKHVDPHRQWKHWZRIROORZLQJGD\VXQWLO KHKDGGLVFRYHUHGKRZYHU\OLWWOH,UHDOO\NQHZ+RZHYHUDIWHUWKUHH GD\VKHGHFLGHGWKDW,UHDOO\ZDVZRUWK\RIWKHSRHW·VODXUHOFURZQ +HZDQWHGWRSODFHLWRQP\KHDGDW1DSOHVDQGDFWXDOO\EHJJHGPH WROHWKLPGRVREXWP\ORYHRI5RPHWRRNSUHFHGHQFHRYHUHYHQWKH DXJXVWUHTXHVWRIDNLQJ:KHQKHVDZWKDW,ZDVLPPRYDEOHKHJDYH PHPHVVDJHVDQGOHWWHUVWRWKH5RPDQ6HQDWHLQZKLFKKHGHFODUHG KLVDSSURYDORIPHLQWKHPRVWIODWWHULQJWHUPV

3HWUDUFKZDVDJUHDWVXSSRUWHURIWKHFLW\DQGKLVGHYRWLRQWRWKH 1HDSROLWDQNLQJZDVUHSDLGFHQWXULHVODWHUZKHQRQHRIWKHPRVW

,17+(6+$'2:2)9(689,86

EHDXWLIXOVWUHHWVLQ1DSOHVZLQGLQJXSDURXQGWKHSURPRQWRU\RI 3RVLOOLSRZDVQDPHGDIWHUKLP²YLD3HWUDUFDLVWRGD\RQHRIWKH PRVWSUHVWLJLRXVDGGUHVVHVLQ1DSOHV 7UXHWRKLV$QJHYLQDQG*XHOSKKHULWDJH.LQJ5REHUWZDVDOVR LQYROYHGLQHFFOHVLDVWLFDOEXLOGLQJSURMHFWV+HODLGWKHILUVWVWRQHRI WKHFRQYHQWRIWKH3RRU&ODUHV7KH&KXUFKRI6DLQW&ODUHLVZKHUH .LQJ5REHUWFKRVHWREHEXULHGDQGKLVRUQDWHIXQHUDOPRQXPHQW GRPLQDWHVWKHDXVWHUHLQWHULRU.LQJ5REHUW·VWRPELQWKH&KXUFKRI 6DLQW&ODUHVKRZVKLPERWKHQWKURQHGDQGLQDUHFXPEHQWEDUHIRRW HIILJ\6FXOSWXUHVRIWKHYLUWXHVDQGWKHVHYHQOLEHUDODUWVVXSSRUW WKHVDUFRSKDJXVDQGVXUURXQGWKHHIILJ\ 7KH $QJHYLQV DUH UHPHPEHUHG LQ 1DSOHV QRW RQO\ IRU WKHLU PDJQLILFHQW*RWKLFFKXUFKHV EXW DOVR IRU WKH RUQDWH PXOWLOHYHO UR\DOWRPEVPDQ\RIWKHPE\7LQRGD&DPDLQRWKHILQHVWVFXOSWRU RIKLVGD\+LVWRPEVDUHIRXQGLQWKH&KXUFKRI6DLQW&ODUHDQGLQ 6DQWD0DULD'RQQD5HJLQDWKHFKXUFKFRPPLVVLRQHGE\5REHUW·V PRWKHU0DULDRI+XQJDU\6KHLVEXULHGLQWKHFKXUFKVKHORYHG 2QO\ D VPDOO IUDJPHQW UHPDLQV RI 7LQR GD &DPDLQR·V IXQHUDO PRQXPHQWIRU3ULQFHVV0DWLOGDRI+DLQDXOWDSRLJQDQWUHPLQGHU RIKHUVDGOLIHDVDIRRWQRWHWRWKHKLVWRU\RIWKH$QJHYLQG\QDVW\ 6KHZDVEULHIO\PDUULHGWR3ULQFH-RKQD\RXQJHUEURWKHURI.LQJ 5REHUW LQ 6KH UHIXVHG WR VXEPLW WR WKH ZLOO RI KHU IDPLO\ DQG ZRXOG QRW UHFRJQLVH WKH XQLRQ DV YDOLG $IWHU GHQ\LQJ KHU KXVEDQGWKHSOHDVXUHVRIWKHPDULWDOEHGVKHZDVUHSXGLDWHGDQG LPSULVRQHGIRURYHUDGHFDGHXQWLOKHUGHDWK1RQHWKHOHVVVKHZDV FRPPHPRUDWHG ZLWK D UR\DO EXULDO7KH UHPDLQLQJ IUDJPHQWV RI 0DWLOGD·VWRPEDGHOLFDWH0DGRQQDDQGFKLOGDUHQRZORFDWHGLQWKH VHPLQDU\LQ$YHUVD,QDOORIWKHVHIXQHUDOPRQXPHQWVWKHHODERUDWH FRPSRVLWLRQVFRPELQHWRIRUPVLQJOHZRUNVRIGD]]OLQJFRPSOH[LW\ 7KHUR\DOWRPEVRIWKHHDUO\IRXUWHHQWKFHQWXU\UHSUHVHQWRQHRI WKHPRVWLPSRUWDQWH[SUHVVLRQVRI1HDSROLWDQVFXOSWXUH

0(',(9$/1$3/(6

6DQ*HQQDUR·VEORRGLVVDLGWRKDYHOLTXHILHGIRUWKHILUVWWLPH LQ 5HJDUGOHVV RI WKLV VLJQ RI IDYRXU IURP LWV SDWURQ VDLQW 1DSOHVZDVDERXWWRHQWHUDYHU\LQDXVSLFLRXVSHULRGLQLWVKLVWRU\ )ROORZLQJWKHGHDWKRI5REHUWWKH:LVHLQ1DSOHVGHJHQHUDWHG LQWRDFHQWXU\RISROLWLFDOLQVWDELOLW\.LQJ5REHUWZDVVXFFHHGHGE\ KLVJUDQGGDXJKWHU\HDUROG3ULQFHVV-RDQ$VD\RXQJJLUO-RDQ KDG EHHQ PDUULHG WR 3ULQFH$QGUHZ RI WKH +XQJDULDQ EUDQFK RI WKH+RXVHRI$QMRX$QGUHZRI+XQJDU\ZDVNLOOHGE\XQNQRZQ DVVDVVLQV VKRUWO\ EHIRUH -RDQ·V FRURQDWLRQ +XQJDULDQ WURRSV LQYDGHGWKHNLQJGRPWRVHHNYHQJHDQFHDQGIRXU\HDUVRIZDUDQG GHVWDELOLVDWLRQ IROORZHG 4XHHQ 6DQFLD 5REHUW·V GHYRXW ZLGRZ UHWLUHG WR D FRQYHQW DQG WRRN WKH YHLO LQ GHVSDLU -RDQ HYHQWXDOO\ PDUULHG WKUHH PRUH WLPHV DQG ZDV UXPRXUHG WR KDYH KDG PDQ\ ORYHUVLQFOXGLQJD5DVSXWLQOLNHPRQN3HWUDUFKGHVFULEHV)DWKHU 5REHUWRI0LOHWRZLWKUHSXOVLRQDQGKRUURU , VDZ D KRUULEOH WKLQJ ZDONLQJ RQ WKUHH OHJV KRRGHG DQG EDUHIRRW SUHDFKLQJ SRYHUW\ EXW GLVVLSDWHG E\ YLFH ² D EDOG UHGIDFHG GZDUI ZKRVHEORDWHGOLPEVZHUHEDUHO\FRYHUHGE\DWDWWHUHGFORDNZKLFK GHOLEHUDWHO\UHYHDOVDJRRGGHDORIKLVXQSOHDVDQWERG\«IURPQRZ RQ,VKDOOILQGLWPXFKHDVLHUWRFUHGLWDVQDNH·VELUWKIURPWKHPDUURZ RIDFRUSVH·VERQHVDIWHUVXFKDYLSHUKDVFUDZOHGIRUWKIURPWKHUR\DO VHSXOFKUH

,WZDVDOVRUXPRXUHGWKDWWKHTXHHQRIWHQZHQWWRWKHVWDEOHVWR FKRRVH KHU ORYHUV IURP DPRQJ WKH JURRPV +RZHYHU VXFK WDOHV RI WKH TXHHQ·V VH[XDO DSSHWLWHV DUH PHUH VSHFXODWLRQ /HJHQG KDV LWWKDWLQ $'WKHSULRURIWKH&DUWKXVLDQPRQDVWHU\RQ&DSUL ZDVWDNHQXQDZDUHVE\QHZVRIWKHDUULYDORI4XHHQ-RDQRQWKH LVODQGDQGVRKDVWLO\PDGHDQDUUDQJHPHQWIRUWKHPRVWEHDXWLIXO IORZHUV IURP WKH PRQDVWHU\ JDUGHQ$Q DOFKHPLVW PRQN GHYLVHG D SHUIXPH IURP WKH EORVVRPV VWLOO PDGH WRGD\ DFFRUGLQJ WR WKH

,17+(6+$'2:2)9(689,86

PRQNV· VHFUHW UHFLSH7KH¶&DUWKXVLD· RU¶&KDUWHUKRXVH·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·V RZQ OLIH7KH VDFUDPHQW RI FRPPXQLRQ GHVLJQ GHSLFWV WKH 4XHHQ DW WKH KHDG RI D JURXS UHFHLYLQJ WKH VDFUDPHQWIURPWKHELVKRSDQGWKHFRQIHVVLRQGHVLJQVKRZVKHULQ WKHDFWRIFRQIHVVLQJWRWKHSULHVWZKLOHSHQLWHQWVDUHVFRXUJHGE\D IULDULQWKHEDFNJURXQG¶0DWULPRQ\·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

0(',(9$/1$3/(6

WKHSRSXODFHWKUHDWHQHGE\DSODJXHVKHDQQRXQFHGWKDWLWZDVIXOO\ PHULWHGE\WKHORFDOSURSHQVLW\WRSULGHDYDULFHDQGLPPRUDOLW\ ,Q SDUWLFXODU VKH ZDV KRUULILHG E\ WKH RVWHQWDWLRXV OX[XU\ RI WKH ZRPHQ·VGUHVVHVDQGWKHLUXVHRIPDNHXS $V 4XHHQ -RDQ ZDV HPEURLOHG LQ KHU FRPSOLFDWHG ORYH OLIH &KDUOHVRI'XUD]]RDQRWKHU$QMRXOLYLQJDWWKH+XQJDULDQFRXUW DQG/RXLVRI$QMRXEURWKHURIWKH.LQJRI)UDQFHERWKVRXJKWWKH FURZQRI1DSOHV&KDUOHVUXVKHGWR,WDO\DQGZDVFURZQHGE\WKH 3RSH+HLPSULVRQHG4XHHQ-RDQLQDQLVRODWHGFDVWOHZKHUHVKH GLHGD\HDUODWHULQP\VWHULRXVFLUFXPVWDQFHV0HDQZKLOH/RXLVRI $QMRXKDGDVVHUWHGKLVULJKWVDQGVHWIRUWKZLWKDQH[SHGLWLRQIURP )UDQFH$VHULHVRIXQH[SHFWHGGHDWKVZRXOGZUHDNHYHQPRUHKDYRF ZLWK WKH VXFFHVVLRQ .LQJ /RXLV RI )UDQFH GLHG VXGGHQO\ VKRUWO\ WKHUHDIWHUVRGLG.LQJ/RXLVRI+XQJDU\&KDUOHVRI'XUD]]RZDV UHFDOOHGWRWDNHWKH+XQJDULDQWKURQHDOWKRXJKE\DWZLVWRIIDWH KHKLPVHOIGLHGDIHZZHHNVODWHULQDFRXS7KHVWUXJJOHEHWZHHQ )UHQFKDQG+XQJDULDQIDFWLRQVFRQWLQXHGRQEHKDOIRIWKHLU\RXQJ KHLUV/DGLVODXVRI'XUD]]RDQG/RXLV,,RI)UDQFH :KHQ/RXLVDUULYHGLQ1DSOHV\RXQJ/DGLVODXVDQGKLVPRWKHU 0DUJDULWD ZHUH IRUFHG WR IOHH WR *DHWD +RZHYHU DIWHU EHLQJ UHFRJQLVHGE\ WKH 3RSH DV WKH OHJLWLPDWH KHLU /DGLVODXV UHWXUQHG WRWKHFDSLWDOLQ3RSH8UEDQ9,FKRVHWKLVSHULRGWRPRYH IURP5RPHWR1DSOHVWKHEHWWHUWREHDEOHWRLQIOXHQFHDIIDLUVRI VWDWHEXWKHHQFRXQWHUHGVWURQJUHVLVWDQFHWRKLVLQWHUIHUHQFHLQWKH 5R\DO3UHURJDWLYHDQGHYHQWXDOO\GHHPHGLWZLVHUWROHDYH1DSOHV IRUKLVRZQVDIHW\/DGLVODXVGLGQRWHQMR\DORQJUHLJQ,QWKHODVW \HDURIKLVOLIHKHZDVLQORYHZLWKWKHGDXJKWHURIDQDSRWKHFDU\ IURP 3HUXJLD:KHQ VKH FRPSODLQHG WKDW /DGLVODXV· SDVVLRQ ZDV EHJLQQLQJ WR ZDQH KHU IDWKHU SHUVXDGHG KHU WR DQRLQW KHU PRVW LQWLPDWHSDUWVZLWKDVSHFLDOO\PL[HGSRPDGHEHIRUHHQWHULQJWKH NLQJ·V EHGFKDPEHU WHOOLQJ KHU WKDW WKH FUHDP ZDV FRPSRVHG RI

,17+(6+$'2:2)9(689,86

PHGLFLQHVZKLFKZRXOGPDNHKLPPRUHDPRURXVVRWKDWKHZRXOG IDOOHYHQPRUHGHHSO\LQORYH,QDFWXDOIDFWWKHSRPDGHZDVPDGH IURPDGHDGO\SRLVRQ7KHNLQJZDVVWUXFNGRZQE\DQXQNQRZQ OLQJHULQJGLVHDVHDQGODWHUGLHGVKRUWO\EHIRUHKLVIRUWLHWKELUWKGD\ +HLVEXULHGLQWKH$XJXVWLQLDQ&KXUFKRI6DLQW-RKQ&DUERQDUD+HUH ZH ILQG /DGLVODXV· PDJQLILFHQW IXQHUDO PRQXPHQW D PDVWHUSLHFH E\WKHVFXOSWRU$QGUHD&LFFRQHZKLFKULVHVDERYHWKHGRRUWRWKH FKRLULQWKUHHOHYHOVWRWKHHQWLUHKHLJKWRIWKHFKXUFK,QWKHILUVW OHYHOVWDQGIRXUFRORVVDOVWDWXHVRI7HPSHUDQFH)RUWLWXGH3UXGHQFH DQG -XVWLFH DERYH ZKLFK LV DQ DUFKLWUDYH ZLWK DQ LQVFULSWLRQ VXUPRXQWHGE\WKHVHDWHGILJXUHVRI.LQJ/DGLVODXVDQGKLVPRWKHU 0DUJDULWDRI'XUD]]RIODQNHGE\WKH9LUWXHV/R\DOW\&KDULW\)DLWK DQG+RSH7KHWKLUGOHYHOVKRZVDQJHOVGUDZLQJDVLGHDFXUWDLQWR GLVSOD\WKHVDUFRSKDJXVFRQWDLQLQJWKHNLQJ·VERG\DERYHZKLFKLV DQ HTXHVWULDQ ILJXUH RI /DGLVODXV ZLWK KLV VZRUG LQ KLV KDQG7KH VXPSWXRXVUHPLQGHURIKLVGHDWKOLWWOHLQGLFDWHVWKHSURVDLFQDWXUH RILWVRFFXUUHQFH $OWKRXJKPDUULHGWKUHHWLPHV/DGLVODXVGLHGZLWKRXWLVVXH,Q \HW DQRWKHU XQH[SHFWHG WZLVW LQ WKH$QJHYLQ OLQH RI VXFFHVVLRQ /DGLVODXV·ROGHUVLVWHU-RDQ,,$QMRX'XUD]]RDVVXPHGWKHWKURQHDW WKHDJHRI$IWHUDOLIHGHGLFDWHGWRWKHSOHDVXUHVRIOLIHDWFRXUW DQGZLWKRXWDQ\SROLWLFDOH[SHUWLVHVKHZDVLOOHTXLSSHGWRUXOH 'XULQJ WKLV GLIILFXOW SHULRG RQH RI WKH DUFKHV RI WKH (JJ &DVWOH FUXPEOHGDQGORFDOVZRUULHGWKDW1DSOHVZDVXQGHUVHULRXVWKUHDW IURPWKHSRVVLEOHGDPDJHWR9LUJLO·VHJJ4XHHQ-RDQZDVIRUFHG WR VROHPQO\ GHFODUH WKDW VKH KDG VXEVWLWXWHG WKH HJJ LQ RUGHU WR DYRLGWKHFLW\EHLQJJULSSHGE\SDQLFDQGIHDURIQHZDQGJUHDWHU PLVIRUWXQHV1RQHWKHOHVVKHUUHLJQZDVYHU\WXUEXOHQW,WLVVDLG WKDWWKH4XHHQNHSWKHUKXVEDQGDYLUWXDOSULVRQHUDQGEUD]HQO\ DPXVHGKHUVHOIZLWKKHUPDQ\ORYHUV6WRULHVDERXWWKHWZR4XHHQ -RDQVRI$QMRXZHUHHODERUDWHGDQGHPEHOOLVKHGRYHUWKH\HDUVDQG

0(',(9$/1$3/(6

LW LV OLNHO\ WKDW ERWK ZHUH DPDOJDPDWHG LQWR D VLQJOH H[DJJHUDWHG ILJXUHRIDQ\PSKRPDQLDFTXHHQZKRNLOOHGKHUORYHUVRQFHWKH\ KDGVDWLVILHGKHUGHVLUHV%RWKTXHHQVKDGLQFRPPRQWKHLUPXOWLSOH PDUULDJHVODFNRIKHLUVDQGXQVXLWDELOLW\WRUXOH 8QGHU H[WUHPH SUHVVXUH IURP RSSRQHQWV RI KHU UXOH -RDQ ,, ORRNHG WR WKH 6SDQLVK UXOHUV RI 6LFLO\ IRU DVVLVWDQFH JLYLQJ WKHP D ORQJDZDLWHG RSSRUWXQLW\ WR JDLQ D IRRWKROG RQ WKH PDLQODQG 6KH HYHQ ZHQW VR IDU DV WR DGRSW$OSKRQVH RI$UDJRQ WKH .LQJ RI 6LFLO\ DOWKRXJK WKH\ ODWHU IHOO RXW DQG -RDQ WULHG WR XQDGRSW KLP)ROORZLQJWKH4XHHQ·VGHDWKWKH)UHQFKSUHWHQGHU5HQpRI $QMRXZDVVXSSRUWHGE\WKH3RSHDQGWKHSRZHUIXOFLW\VWDWHVRI )ORUHQFH*HQRD0LODQDQG9HQLFH7KH*HQRYHVHNLGQDSSHGDQG LPSULVRQHG$OSKRQVH RI$UDJRQ EHIRUH KDQGLQJ KLP RYHU WR WKH 'XNHRI0LODQ3KLOLS0DULD9LVFRQWL7KHPHHWLQJEHWZHHQWKHWZR PHQEURXJKWXQH[SHFWHGUHVXOWVZKHQWKH\UHDOLVHGWKDWWKH\KDG VHYHUDOFRPPRQLQWHUHVWVDQGKDPPHUHGRXWDPXWXDOO\EHQHILFLDO SHDFHDJUHHPHQW7KH$UDJRQHVHUHQRXQFHGWKHLUFODLPVWR&RUVLFD DQG 7XVFDQ\ DJUHHG WR VXSSRUW WKH 9LVFRQWLV DJDLQVW WKH RWKHU 0LODQHVHSUHWHQGHU)UDQFHVFR6IRU]DDQGPDGHDUUDQJHPHQWVWR SD\VXEVWDQWLDOGDPDJHVLQH[FKDQJHIRU$OSKRQVH·VUHOHDVHDOORZLQJ KLPWRHQWHU1DSOHVYLFWRULRXVO\LQWKHVXPPHURI

&+$37(57+5((

6 3 $ 1 , 6 + 1 $3/(6

$UDJRQHVH1DSOHV¦

,

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¶7KH1HZ&DVWOH>KDVEHHQ@ UHVWRUHG E\ WKH PRVW JORULRXV .LQJ$OSKRQVH DQG VXSSOLHG PRUH WKDQDQ\RQHKDVHYHUVHHQLPSUHJQDEOHZLWKDWULXPSKDODUFKRYHU WKHHQWUDQFHVLPLODUWRWKRVHRIWKHJUHDW5RPDQVZLWKPDJQLILFHQW OLYLQJ TXDUWHUV LQVLGH PRVW VXLWHG WR D JUHDW SULQFH·7KH ULFKO\

,17+(6+$'2:2)9(689,86

VFXOSWHG PRQXPHQWDO DUFK RYHU WKH HQWUDQFH ZDV FRPPLVVLRQHG WR FRPPHPRUDWH $OSKRQVH·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·VOLEUDU\LQWKH0DVFKLR$QJLRLQR

63$1,6+1$3/(6

ZDV IDPRXV WKURXJKRXW (XURSH +XPDQLVP ² WKH SKLORVRSKLFDO PRYHPHQW EDVHG RQ WKH DSSUHFLDWLRQ DQG DVVLPLODWLRQ RI FODVVLFDO FXOWXUH WKURXJK WKH UHGLVFRYHU\ RI WKH PDQ\ PDQXVFULSWV ZKLFK KDGEHHQFRQVHUYHGLQPRQDVWHULHVWKURXJKRXWWKH0LGGOH$JHV²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·VUHLJQHQWLWOHG 'HGLFWLVHWIDFWLV$OSKRQVL 5HJLV,O3DQRUPLWDDOVRZRUNHGDVWKHUR\DOOLEUDULDQ)ROORZLQJKLV GHDWKOHDGHUVKLSRIWKHDFDGHP\IHOOWR*LRYDQQL3RQWDQRRQHRI WKHJUHDWHVW,WDOLDQKXPDQLVWV *LRYDQQL3RQWDQRZDVERUQLQ8PEULDEXWVSHQWKLVDGXOWOLIHDVD FRXUWLHUDWWKH$UDJRQHVHFRXUWLQ1DSOHV+HZDVDWUXH5HQDLVVDQFH PDQQRWRQO\DJLIWHGZULWHULQSURVHDQGYHUVHEXWDOVRDWDOHQWHG GLSORPDWDQGSROLWLFLDQ3RQWDQR·VZLGHUDQJLQJLQWHUHVWVLQFOXGHG DVWURORJ\ DQG KRUWLFXOWXUH RQ ZKLFK KH SXEOLVKHG LPSRUWDQW ZRUNV 3RQWDQR DOVR KDG D VWURQJ PRUDO VHQVH DV GHPRQVWUDWHG E\KLVWUHDWLHVRQWKHFLYLFDQGVRFLDOYLUWXHV+HZURWHKLVWRULFDO ZRUNVDERXW1DSOHVDQGWKH$UDJRQHVHDQGUHFRXQWHGWKHVWRU\RI )HUUDQWH·VVWUXJJOHVDJDLQVWWKHORFDOQRELOLW\7KH3RQWDQR&KDSHO

,17+(6+$'2:2)9(689,86

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qFKHVFHQHLQWKHLUKRPHORYLQJO\ DVVHPEOHGDQGSODFHGRQGLVSOD\HYHU\&KULVWPDVVHDVRQ 7KHFKXUFK LV UHDFKHG E\ D ORQJ IOLJKW RI VWDLUV ZKLFK WHUPLQDWHV LQ D WHUUDFH ZLWKVWXQQLQJYLHZVDFURVVWKHED\WRWKH(JJ&DVWOH9HVXYLXVDQG WKH6RUUHQWRSHQLQVXOD6DQQD]DUR·VWRPEOLHVEHKLQGWKHKLJKDOWDU 7KH LQVFULSWLRQ UHDGV¶*LYH IORZHUV WR WKH VDFUHG DVKHV KHUH OLHV WKDWIDPRXV6DQQD]DURFORVHWR9LUJLOLQERWKSRHWU\DQGVHSXOFKUH· ,QGHHG 9LUJLO·V WRPE LV RQO\ D IHZ KXQGUHG PHWUHV DZD\ DW

63$1,6+1$3/(6

7\SLFDOSUHVHSH VFHQH

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

,17+(6+$'2:2)9(689,86

LQWKHEXFROLFWUDQTXLOOLIHVW\OHRIWKHVKHSKHUGVLQFORVHFRQWDFW ZLWKQDWXUHDPXVLQJWKHPVHOYHVZLWKSRHWU\DQGVLQJLQJ2QHQLJKW 6LQFHURKDVDWHUULEOHIRUHERGLQJGUHDPDQGVHWVRXWRQDVROLWDU\ ZDON WKURXJK WKH FRXQWU\VLGH$W WKH ERWWRP RI D PRXQWDLQ KH PHHWVDQ\PSKZKROHDGVKLPDORQJDIDQWDVWLFDOXQGHUJURXQGSDWK WRKLVEHORYHGKRPHWRZQRI1DSOHVZKHUH6LQFHUROHDUQVRIWKH GHDWKRIWKHZRPDQKHORYHG$FFRUGLQJWRWKHSDVWRUDOWUDGLWLRQ 6DQQD]DUR·V IDEOH KDV DQ DOOHJRULFDO PHDQLQJ 6LQFHUR LV WKH SRHW KLPVHOIDQGWKHZRPDQKHORYHGKDVEHHQLGHQWLILHGDV&DUPRVLQD %RQLIDFLRKLVFKLOGKRRGVZHHWKHDUWZKRGLHGDVD\RXQJZRPDQ 2IFRXUVHWKHJUHDWHVWDOOHJRU\RIDOOLVWKHZRUOGRI$UFDGLDWKH SRHW·VUHFUHDWLRQRIWKHEXFROLFFODVVLFDOWUDGLWLRQZKLFKUHDFKHG LWVDSRJHHLQWKHZULWLQJVRI9LUJLO7KH*UHHNVKHSKHUGVRI$UFDGLD ZHUHNQRZQIRUWKHSXULW\RIWKHLUFXVWRPVDQGWKHVLPSOLFLW\RI WKHLU OLIHVW\OH ZKLFK HYRNHG PHPRULHV RI D P\WKLFDO JROGHQ DJH RIKXPDQLW\7KXV$UFDGLDEHFDPHV\QRQ\PRXVZLWKWKHOLEHUDWLRQ RIURPDQWLFVHQWLPHQWVDODQGRILG\OOLFVSRQWDQHRXVFRPPXQLRQ EHWZHHQPDQDQGQDWXUHZKHUHWUXHORYHZDVH[SUHVVHGWKURXJK VRQJ IDU IURP WKH VWUHVVHV DQG VWUDLQV RI GDLO\ OLYLQJ 6DQQD]DUR·V SRHPZDVDKXJHVXFFHVVLQ,WDO\DQGWKURXJKRXW(XURSHDQGKLV ZULWLQJZDVFHOHEUDWHGHVSHFLDOO\IRULWVKDUPRQ\DQGLPDJHU\,Q 6DQQD]DUR·VSRHPZHDOVRILQGDFKDUPLQJGHVFULSWLRQRI$UDJRQHVH 1DSOHV 1DSOHV DV \RX KDYH DOO KHDUG VHYHUDO WLPHV LV WKH PRVW IHUWLOH DQG HQMR\DEOHSDUWRI,WDO\SODFHGDORQJWKHVHDFRDVWDIDPRXVDQGPRVW QREOH FLW\ KDSS\ LQ ERWK DUPV DQG OHWWHUV SHUKDSV PRUH WKDQ DQ\ RWKHU FLW\ LQ WKH ZRUOG « , UHPHPEHU WKH GHOLJKWV RI WKH ED\ WKH PDUYHOORXVDQGJUHDWEXLOGLQJVWKHSOHDVDQWODNHVWKHHQMR\DEOHDQG EHDXWLIXOLVODQGVWKHVXOSKXURXVPRXQWDLQVDQGWKHKDSS\FRDVWOLQH RI 3RVLOOLSR ZLWK LWV JURWWR LQKDELWHG E\ GHOLJKWIXO YLOODV DQG VRIWO\ EDWKHGE\WKHVDOW\ZDYHV$QGFORVHE\WKHDEXQGDQWKLOODERYHWKH

63$1,6+1$3/(6

FLW\DQGP\SHUVRQDOJUDFLRXVPHPRU\RIWKHSHUIXPHGURVHJDUGHQV «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

,17+(6+$'2:2)9(689,86

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·VGHDWKLQKLV6SDQLVKSRVVHVVLRQVDQGWKH LVODQGVZHQWWRKLVEURWKHU-RKQEXWKHEHTXHDWKHG1DSOHVWRKLV LOOHJLWLPDWH VRQ )HUUDQWH ,O 3DQRUPLWD PRXUQHG WKDW ZLWK WKH GHDWKRIWKHNLQJHYHQWKHPXVHVKDGGLHG7RZDUGVWKHHQGRIKLV OLIH$OSKRQVHKDGEHFRPHPRUHDFFOLPDWLVHGWR1DSOHVDQGSDVVHG RQWKHIROORZLQJZLVHDGYLFHWRKLVVRQ¶$YRLGWKH6SDQLVKORZHU WD[HVDQGUHPDLQRQJRRGWHUPVZLWKWKHSULQFHVRI,WDO\HVSHFLDOO\ WKH3RSHV·/LNHKLVIDWKHUDWWKH0DVFKLR$QJLRLQR)HUUDQWHEXLOW KLVRZQWULXPSKDODUFKDWWKH&DSXDQD*DWHDEDVUHOLHIGHSLFWLQJ KLV FRURQDWLRQ7KH UHIRUWLILFDWLRQ ZRUNV ZHUH RQH RI )HUUDQWH·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

63$1,6+1$3/(6

&XOWXUDOSURGXFWLRQLQ$QJHYLQ1DSOHVZDVJUHDWO\DVVLVWHGE\DQ DGYDQFHRIH[WUDRUGLQDU\LPSRUWDQFH²WKHLQYHQWLRQRIWKHSULQWLQJ SUHVV$ORFDOVFKRODU$QJHOR&DWRQHHQWKXVHG 7KHUHDUHYHU\PDQ\H[FHHGLQJO\EULJKW\RXQJPHQZKRWUXO\GHVLUHG WRGHGLFDWHWKHPVHOYHVWRWKHVWXG\RIWKHOLEHUDODUWVEXWWKH\DUH XQDEOHWREHFDXVHRIDODFNRIERRNVZKLFKWKHLUOLPLWHGUHVRXUFHV PDNHLWLPSRVVLEOHWREX\+RZHYHUQRZWKH\ZLOOEHFRQVROHGDQG ZLOO QRW EH KHOG EDFN EHFDXVH D PLUDFOH KDV EURXJKW D *HUPDQ WR 1DSOHV ² RQH RI WKRVH PHQ ZKR KDYH JLYHQ WR RXU DJH WKH DUW RI SULQWLQJZLWKPRYHDEOHW\SHIDFH

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« D PRVW IORXULVKLQJ WKURQJ RI VLQJHUV VHOHFWHG IURP WKH )UHQFK %ULWLVK 6SDQLVK DQG *HUPDQ WHUULWRULHVDQGFKDUJHGRQO\ZLWKWKHUHJXODUDSSRLQWHGSUDLVHVDQG FHUHPRQLHVRIWKHFKXUFK

3ULQFHVV %HDWULFH WKH NLQJ·V GDXJKWHU VWXGLHG PXVLF XQGHU WKH 6SDQLVK PXVLF PDVWHU7LQFWRULV ZKR LV NQRZQ WR KDYH GHGLFDWHG VHYHUDO HODERUDWH SRO\SKRQLF PDVVHV WR KHU &RXUW HQWHUWDLQPHQW ZDVSURYLGHGE\VRORLVWVLQJHUVZLWKPXVLFDODFFRPSDQLPHQW7KH SRHWDQGJXLWDULVW%HQHGHWWR*DUHWKDOVRNQRZQDVLO&DUHWHRZRXOG

,17+(6+$'2:2)9(689,86

RIWHQDPXVHWKHUR\DOIDPLO\DQGFRXUWLHUVZLWKVRQJVIURPWKHLU QDWLYH6SDLQDQGKLVRZQSRHPVVHWWRPXVLF $V)HUUDQWHKDGEHHQERUQLQ6SDLQDQGFDPHWR1DSOHVZKHQKH ZDVDQDGXOWKHFRQWLQXHGWRVSHDNKLVQDWLYHWRQJXHDQGKDGGLIILFXOW\ OHDUQLQJ,WDOLDQ7KLVFRPELQHGZLWKKLVLOOHJLWLPDWHGHVFHQWFDXVHG )HUUDQWHWREHVFRUQHGE\WKHQRELOLW\ZKRGHVLUHGPRUHDXWRQRP\ SUHVWLJHDQGSRZHU7KHDULVWRFUDWVIRUPHGWKHLURZQDUPLHVDQG ZLWK WKH VXSSRUW RI WKH 3RSH WULHG WR EH ULG RI WKHLU HUVWZKLOH VRYHUHLJQ)HUUDQWHGLGQRWKDYHKLVIDWKHU·VVWURQJSHUVRQDOLW\DQG IRXQG LW GLIILFXOW WR FRQWURO WKH QREOHV7R DGG WR KLV WULEXODWLRQV WKH3RSHKDGUHYRNHG)HUUDQWH·VULJKWRIVXFFHVVLRQEHFDXVHRIKLV LOOHJLWLPDWHELUWK SUHIHUULQJ WR VXSSRUW WKH UHWXUQ RI WKH *XHOSK +RXVH RI$QMRX WR 6RXWKHUQ ,WDO\7KH )UDQFR6SDQLVK ULYDOU\ IRU KHJHPRQ\RYHUWKH.LQJGRPRIWKH7ZR6LFLOLHVFRQWLQXHGXQDEDWHG :KLOH)HUUDQWHZDVDZD\IURPKLVFDSLWDOILJKWLQJUHEHOOLRXVQREOHV LQ&DODEULDWKH)UHQFKSUHWHQGHU-RKQRI$QMRXZDVDEOHWRRFFXS\ WKHFDSLWDO,WWRRNVHYHQ\HDUVIRU)HUUDQWHWREHDEOHWRUHWXUQWR 1DSOHVDQGILQDOO\EULQJWKHHQWLUHNLQJGRPXQGHUKLVFRQWURO:KHQ 1HDSROLWDQ IRUFHV XQGHU WKH FRPPDQG RI )HUUDQWH·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·V JUDQGGDXJKWHUPDUU\D\RXQJQREOHPDQRIWKH&RSSRODIDPLO\ZKR KDGSUHYLRXVO\SURPRWHGRSSRVLWLRQWRWKH$QJHYLQV$PEDVVDGRUV IURP0LODQ)ORUHQFHDQG)HUUDUDZHUHSUHVHQWDVZHOODVVHYHUDO

63$1,6+1$3/(6

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· UHOLFV IURP &DPSDQLD DQG IXUWKHU DILHOG DOO RI ZKLFK DXJPHQWHG WKH FLW\·V SUHVWLJH 8S WR UHOLFVRI&KULVWLDQPDUW\UVZHUHKHOGLQWKHFKXUFKHVFRQYHQWVDQG

,17+(6+$'2:2)9(689,86

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

63$1,6+1$3/(6

.LQJ)HUUDQWH7KHDUFKLWHFW$QWRQLR5RVVHOOLQRXVHGDVKLVPRGHO DQHDULGHQWLFDOFKDSHOKHKDGSUHYLRXVO\GHVLJQHGIRUWKH&KXUFK RI6DQ0LQLDWRLQ)ORUHQFH,QKRPDJHWRWKHIDYRXULWHELEOLFDOVWRU\ RI WKH 1HDSROLWDQV KH VFXOSWHG D EDVUHOLHI QDWLYLW\ VFHQH DV WKH IRFDOSRLQWRIWKHFKDSHO7KHILJXUHVRI0DU\DQG-RVHSKDUHDOPRVW WKUHHGLPHQVLRQDO VWDQGLQJ RXW DJDLQVW WKH ORZHU UHOLHI RI WKH EDFNJURXQG,QKLV/LYHVRIWKH$UWLVWVWKH)ORUHQWLQH*LRUJLR9DVDUL QDUUDWHVWKDWKHZDV¶VHQWWR1DSOHVE\*LDPPDWWHRG·$YHUVDWKH OHDGHURIWKHPRQNVRI0RQWH2OLYHWRLQRUGHUWRSDLQWWKHUHIHFWRU\ RI WKHLU PRQDVWHU\· +RZHYHU XSRQ DUULYDO KH KDG PLVJLYLQJV DQG ZDQWHG WR UHIXVH WKH FRPPLVVLRQ )RUWXQDWHO\ IRU SRVWHULW\ WKHPRQNVZHUHDEOHWRUHDVVXUHKLPDQG9DVDUL·VFHLOLQJIUHVFRHV FRPSOLPHQWHGE\WKHWZRELEOLFDOO\LQVSLUHGSDLQWLQJV'LQQHULQWKH +RXVHRI/HYLDQG0DQQDIURP+HDYHQLOOXPLQDWHWKHUHIHFWRU\ZLWK WKHLU GHOLFDWH EHDXW\9DVDUL SXUSRVHO\ GHVLJQHG WKH GHFRUDWLRQV DFFRUGLQJWRKLV&DWKROLFEHOLHIV¶WKHYDXOWVDUHGHFRUDWHGLQWKUHH SDUWV«WKHILUVWGHDOVZLWK)DLWKWKHVHFRQG5HOLJLRQDQGWKHWKLUG (WHUQLW\ (DFK RI WKHP LV HQFLUFOHG E\ HLJKW YLUWXHV LQ RUGHU WR GHPRQVWUDWHWRWKHPRQNVZKRHDWLQWKLVUHIHFWRU\ZKDWSHUIHFWLRQ LVUHTXHVWHGLQWKHLUOLYHV·$QRWKHUWUHDVXUHKRXVHGLQWKHFKXUFKLV *XLGR0D]]RQL·V /DPHQWDWLRQRYHUWKH'HDG&KULVWDSRZHUIXOOLIHVL]H WDEOHDXRIJULHIVWULFNHQILJXUHVVDLGWREHPRGHOOHGRQPHPEHUV RIWKH$UDJRQHVHUR\DOIDPLO\6DLQW$QQDGHL/RPEDUGLLVFXUUHQWO\ XQGHUJRLQJPDMRUUHVWRUDWLRQZRUNWREULQJLWEDFNWRLWVIRUPHU JORU\DIWHUVHYHUHGDPDJHLQWKHERPEDUGPHQWVRI $IWHU )HUUDQWH·V GHDWK WKH QREOHV H[DFWHG WKHLU UHYHQJH DQG FDOOHGRQWKH.LQJRI)UDQFH&KDUOHV9,,,ZKRZDVDOVRKHLUWRWKH $QJHYLQG\QDVW\ WRUHWXUQ7KXVWKHWZRJUHDWHVWSRZHUVRIWKH DJH)UDQFHDQG6SDLQFODVKHGRQFHDJDLQRYHUVRYHUHLJQW\RI1DSOHV 7KH)UHQFKIOHHWFRQTXHUHGWKH$UDJRQHVHLQDEDWWOHRIIWKHFRDVWRI /LJXULDDQGDUULYHGLQ1DSOHVWULXPSKDQW)HUUDQWH·VVRQ$OSKRQVH

,17+(6+$'2:2)9(689,86

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p GH OD9LJQH ZKR NHSW D PHPRLU RI VWD\ LQ ZKLFK KH GHVFULEHVKLVLPSUHVVLRQVRIWKHFLW\ 7KHUHDUHVRPHYHU\XQXVXDOWKLQJVVXFKDVKRXVHVZLWKOLWWOHZLQGRZV ODUJH JDOOHULHV ORQJ ZLGH ODUJH DQG SOHDVDQW JDUGHQV EHDXWLIXO DQG SHUIXPHG IORZHUV JDUGHQV DYHQXHV DQG KHGJHV IRXQWDLQV DQG ULYHUOHWVWRHQMR\RQHVHOIDQGKDYHIXQDQGWKHUHDUHDQFLHQWVWDWXHV PDGHIURPDODEDVWHUZKLWHPDUEOHDQGDOVRSRUSK\U\«DFRPSOHWHO\ HQFORVHGSDUNIXOORIKHDOWK\KHUEVPXFKODUJHUWKDQWKH)RUHVWRI 9LQFHQQHVZLWKOLYHWUHHVRUDQJHWUHHVSRPHJUDQDWHVILJVSDOPDQG GDWH WUHHV SHDU WUHHV DOPRQG WUHHV DSSOH WUHHV ODXUHOV URVHPDU\ PDUMRUDPDQGJLOO\IORZHUVMXVWDVEHDXWLIXODQGRWKHUSHUIXPHGSODQWV DQGURVHEXVKHVZKLFKFDQJLYHQLQHRUWHQFDVNVRIURVHZDWHU

$QGUpGHOD9LJQHZDVDOVRSUHVHQWZKHQWKHNLQJDWWHQGHGPDVV DWWKH&DWKHGUDO$V&KDUOHVDSSURDFKHGWKHKLJKDOWDUWKHELVKRS «VHQWIRUWKHSUHFLRXVEORRGLQDJODVVDPSRXOHDQGLWZDVVKRZQWR WKHNLQJDQGKHZDVJLYHQDVLOYHUZDQGWRWRXFKWKHEORRGWKDWZDV ZLWKLQWKHJODVVDPSRXOHDVKDUGDVDVWRQH7KHNLQJWRXFKHGLWZLWK WKHZDQGZKLFKZDVWKHQSODFHGXSRQWKHDOWDUEHIRUHWKHEXVWRIWKH JORULRXV6DLQW,PPHGLDWHO\WKHEORRGEHJDQWRKHDWXSDQGOLTXHI\ OLNHWKDWRIDKXPDQERLOLQJDQGEXEEOLQJRQHRIWKHJUHDWHVWPLUDFOHV HYHUZLWQHVVHG

63$1,6+1$3/(6

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
2Q0D\DIWHUDVHULHVRIVNLUPLVKHV6SDQLVKWURRSVOHGE\HO JUDQFDSLWDQR&RQVDOYRGH&RUGREDHQWHUHG1DSOHVDQGVXPPDULO\ HYLFWHG WKH )UHQFK7KH .LQJ RI 6SDLQ GHFLGHG WR RUJDQLVH DQG FRQVROLGDWHKLVQHZO\FRQTXHUHGWHUULWRULHVDQGPDGH1DSOHVWKH FDSLWDO RI D YLFHUHDOP &RQIHUULQJ VXFK VWDWXV RQ 1DSOHV PHDQW WKDW WKH FLW\ FRXOG UHWDLQ D GHJUHH RI DXWRQRP\ XQGHU WKH UXOH RI D YLFHUR\ DQG ZDV WKXV VHSDUDWH IURP WKH YLFHUHDOP RI 6LFLO\ ZKLFKKDGLWVFDSLWDOLQ3DOHUPR)RU0DGULGWKHJRYHUQPHQWRI

,17+(6+$'2:2)9(689,86

1DSOHVZDVEXWDPLQRUPDWWHU&RQVDOYRDOUHDG\FHOHEUDWHGIRUKLV YLFWRU\RYHUWKH0RRUVLQ*UDQDGDZDVDSSRLQWHGWKHILUVWYLFHUR\ RI1DSOHV7KH.LQJGRPRIWKH7ZR6LFLOLHVLQWDFWEHFDPHDFRORQ\ RIWKHJUHDW6SDQLVK(PSLUH ,Q &KDUOHV 9 RI +DEVEXUJ LQKHULWHG DOO WKH 6SDQLVK SRVVHVVLRQVDVZHOODV$XVWULDDQG)ODQGHUV:LWKGXHUHYHUHQFHIRU WKHODGLHVRI1DSOHV&KDUOHV9LVIDPRXVO\NQRZQWRKDYHGHFODUHG ¶, VSHDN 6SDQLVK WR *RG ,WDOLDQ WR ZRPHQ )UHQFK WR PHQ DQG *HUPDQWRP\KRUVH·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
63$1,6+1$3/(6

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

,17+(6+$'2:2)9(689,86

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·ILUVWLPSUHVVLRQ RI1DSOHV$FRQWHPSRUDU\WUDYHOOHUQRWHG ,VHHLQHYHU\VWUHHWHYHU\DOOH\DWHYHU\FRUQHUVRPDQ\SHRSOHZKR MRVWOHPHDQGWUHDGRQPHDQG,KDYHGLIILFXOW\LQJHWWLQJDZD\IURP WKHP,JRLQWRFKXUFKHVRIZKLFKWKHUHDUHVRPDQ\DQG,ILQGWKHP IXOORISHRSOH\HWWKH\DUHDOOWKHUHRXWVLGHQRWWRPHQWLRQDOOWKRVH ZKRDUHDWZRUNDWKRPHRULQWKHRIILFHVDQGRWKHUEXLOGLQJVRQH VHHV WKH VWUHHWV QRW MXVW RQH RU WHQ EXW DOO RI WKHP IXOO RI SHRSOH RQIRRWRQKRUVHEDFNLQFDUULDJHV«1RWKLQJLVPRUHGLIILFXOWWKDQ JHWWLQJDERXWLQ1DSOHVZKHUHYHU,JRDQGDWZKDWHYHUWLPHRIGD\

%\ WKH VHYHQWHHQWK FHQWXU\ WKHUH ZDV IUHTXHQW QRVWDOJLD IRU WKH JHQWOH1DSOHVRIHDUOLHUWLPHV 7KH1HDSROLWDQSRSXODFHFRPSULVHGQXPHURXVDUWLVDQVDQGVKRS RZQHUVZKRVHLQFRPHIURPIDPLO\UXQHQWHUSULVHVZDVXVXDOO\MXVW HQRXJKIRUDEDVLFOHYHORIVXEVLVWHQFH7KHSDODFHVRIWKHQRELOLW\ ZHUHDOVRVRXUFHVRIHPSOR\PHQWIRUVNLOOHGZRUNHUVZKRFRRNHG

63$1,6+1$3/(6

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¶DUW RI DUUDQJLQJ WKLQJV· ZKHUHE\ WKH\ PLUDFXORXVO\ VFUDSHG WRJHWKHU EDVLF QHFHVVLWLHV7KH PRVW IRUWXQDWH ZHQW LQWR GRPHVWLF VHUYLFH EXW PDQ\ OLYHG RQ ZKDW WKH\ FRXOG JDWKHU WRJHWKHU E\ SURYLGLQJXQVNLOOHGODERXURUEDVLFVHUYLFHV0DQ\ZHUHSDLGWRFU\DW IXQHUDOVRUWRDFFRPSDQ\WKHLUPRUHIRUWXQDWHQHLJKERXUVLQDVPDOO HQWRXUDJHRIWHQFDUU\LQJPHPEHUVRIKLJKVRFLHW\LQVHDWVDERYHWKH PXGG\VWUHHWV7KHOD]]DURQLDFFHSWHGWKHLUGHVWLQ\ZLWKIDWDOLVPDQG ZHUHKDSS\HQRXJKPRVWRIWKHWLPHWREHJRYHUQHGZLWKWKHWKUHH )VIDULQDIRUFDHIHVWLQL²IORXUWKHVFDIIROGDQGSXEOLFIHVWLYDOV ,QRUGHUWRDYRLGFLYLOXQUHVWWKHJRYHUQPHQWHQVXUHGSURYLVLRQV IRUWKHFLW\DQGVWRUHGFRUQJUDLQDQGZKHDWLQPDVVLYHTXDQWLWLHV DVUHVHUYHVIRUWLPHVRIFULVLV7KXVQRWZLWKVWDQGLQJWKHEXUGHQRQ FLYLFILQDQFHVVWDSOHIRRGVZHUHDOPRVWDOZD\VDYDLODEOHDWFRQWUROOHG SULFHV%\WKHHQGRIWKHVL[WHHQWKFHQWXU\LWZDVEHFRPLQJDORJLVWLFDO QLJKWPDUHWRVXSSO\SHULVKDEOHYHJHWDEOHVWRVXFKDODUJHFLW\DQG WKH1HDSROLWDQVEHJDQWRGHSHQGPRUHRQGULHGSDVWD²PDFFKHURQL ²ZKLFKFRXOGEHVWRUHGDWOHQJWKLQWKHLUNLWFKHQV,WEHFDPHWKH VWDSOH IRRG RI WKH SRRU $OWKRXJK PDFFKHURQL DUH PHQWLRQHG LQ %RFFDFFLR·V 'HFDPHURQ DQG LQ D SDSDO EXOO LVVXHG E\ 8UEDQ9, LQ LWLVJHQHUDOO\UHFRJQLVHGWKDWSDVWDRULJLQDWHGLQWKHWRZQRI *UDJQDQVMXVWRXWVLGHRI1DSOHVZKHUHWKHGL1LFRODIDPLO\KDYHEHHQ SURGXFLQJGXUXPZKHDWVHPROLQDSDVWDVLQFH7KHWRZQKRXVHG

,17+(6+$'2:2)9(689,86

VWDWHJUDQDULHVIURP5RPDQWLPHVDQGWKHWRSRORJLFDOHW\PRORJ\RI *UDJQDQRGHULYHVIURPWKH/DWLQJHQVJUDQLD¶WKHJUDLQSHRSOH·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·VUHSUHVHQWDWLYHZDVQRPLQDWHGE\WKHYLFHUR\IURPD OLVWRIVL[QDPHVFKRVHQLQHOHFWLRQVE\WKHSURFXUDWRUVRIWKHRWWLQH 7KHUHZHUHRWWLQHFRUUHVSRQGLQJWRWKHGLVWULFWVLQWRZKLFKWKH FLW\ZDVGLYLGHG7KHSRVLWLRQRIWKHSHRSOHZDVSUHFDULRXVEHFDXVH RILWVGHSHQGHQFHRQWKHZKLPRIWKHYLFHUR\\HWDWWKHVDPHWLPH LWZDVYHU\VWURQJEHFDXVHWKHRSLQLRQH[SUHVVHGE\WKHSHRSOH·V UHSUHVHQWDWLYHZDVDOPRVWLQYDULDEO\WKDWRIWKHUR\DOJRYHUQPHQW 7KHQRELOLW\ZDVHLWKHU¶RIWKHSLD]]D·RURXWVLGH7KH¶SLD]]H·ZHUH WKHGLYLVLRQVRIWKHFLW\DULVWRFUDF\ZKLFKZHUHQRWWHUULWRULDOEXW SXUHO\DVVRFLDWLYH7KHUHZHUHILYHRIWKHP²&DSXDQD1LGR3RUWR 3RUWDQRYD DQG 0RQWDJQD ² FRPSULVLQJ DERXW IDPLOLHV7KH

63$1,6+1$3/(6

QREOHIDPLOLHV¶RXWVLGHWKHSLD]]D·PLJKWEHPRUHRUOHVVLOOXVWULRXV EXWRQO\WKRVH¶RIWKHSLD]]D·WRRNSDUWLQFLYLFJRYHUQPHQWZKLFK ZDV H[HUFLVHG E\ D FRXQFLO FRPSRVHG RI RQH UHSUHVHQWDWLYH IRU HDFK RI WKH ILYH¶SLD]]H·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·ZRUWKSHU\HDU9HQLFH RQWKHRWKHUKDQGGRHVQRWKDYHQHDUO\HQRXJKLQLWVRZQWHUULWRULHV IRULWVRZQSURYLVLRQLQJ,WGRHVQRWH[SRUWDQ\YLFWXDOVDQGLQGHHGLW PXVWVSHQGQHDUO\GXFDWVSHU\HDURUPRUHRQIRRG«+LV &DWKROLF0DMHVW\·VUHYHQXHVIURPWKH.LQJGRPRI1DSOHVDUHHQWLUHO\ VSHQWLQDQGGLHWKHUHEHFDXVHQRQHDWDOOLVSXWDZD\LQWKHWUHDVXU\ «DOPRVWDOOVROGDQGFRQYHUWHGLQWRSD\IRUEHQHILFLDULHVDQGPLOLWLD RIWKHNLQJGRP,Q9HQLFHDOOWKHLQFRPHVRIWKH6LJQRULDDUHQRWVSHQW EXWPRVWDUHSXWLQWKHWUHDVXU\DQGDIWHUWKHGHEWLQFXUUHGLQWKH\HDU ²IRUWKHQDY\ZDVUHWLUHGE\3URFXUDWRU3ULXOLQHDUO\ GXFDWV DUH SODFHG LQ WKH RIILFH RI WKH GHSRVLWRU\ HYHU\ \HDU EHVLGHV ZKDWLVEURXJKWLQWRWKHPLQW7KHUHIRUHFRQVLGHULQJWKHFRQGLWLRQV RIERWKFLWLHV1DSOHVVKRXOGEHLQDSRZHUIXOSRVLWLRQWRDERXQGLQ PRQH\ ZKHUHDV9HQLFH RXJKW WR KDYH YHU\ OLWWOH 1RQHWKHOHVV WKH RSSRVLWHDFWXDOO\KDSSHQVDQG9HQLFHDERXQGVLQPRQH\ZKLOH1DSOHV ODFNVLW«

,17+(6+$'2:2)9(689,86

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« RQH PXVW WDNH LQWR DFFRXQW WKH UHYHQXHV DFFUXLQJ WR IRUHLJQHUV LQWKHNLQJGRP>IURPORDQV@WR+LV0DMHVW\RUWRSULYDWHLQGLYLGXDOV DQG WKHLU SRVVHVVLRQV DORQJ ZLWK WKH PDQXIDFWXUHV WKH\ RSHUDWH LQ WKHNLQJGRPZKLFKPDQXIDFWXUHVDUHIRUWKHPRVWSDUWLQWKHKDQGV RIIRUHLJQHUV7KHQDWLYHVGXHWRWKHLUQHJOLJHQFHRURQHVKRXOGVD\ LQGLIIHUHQFHQRWRQO\IDLOWRHVWDEOLVKLQGXVWULHVLQIRUHLJQFRXQWULHV EXWFDQQRWGRDQ\WKLQJZLWKWKHLURZQSURGXFWVLQWKHLURZQFRXQWU\ HYHQWKRXJKWKH\VHHIRUHLJQHUVGRVR«

6KRUWO\ DIWHU SUHVHQWLQJ KLV WUHDWLVH WR WKH YLFHUR\ 6HUUD ZDV DUUHVWHGDQGLPSULVRQHG,WVHHPHGWKDWQRRQHZDQWHGWRKHDUWKH WUXWKFOLQJLQJWRWKHIDFWWKDW1DSOHVZDVWKHPRVWDFWLYHSRUWLQ WKH0HGLWHUUDQHDQDQGHQMR\HGDPRQRSRO\DVWKHRQO\FRPPHUFLDO SRUWIRUWKHHQWLUHVRXWKRI,WDO\0XFKRIWKHZHDOWKJHQHUDWHGE\ IRUHLJQWUDGHUHPDLQHGLQWKHKDQGVRIIRUHLJQHUVZKRGRPLQDWHG WKLVVHFWRUDQGZHUHXQOLNHO\WRUHLQYHVWLQWKHFLW\7KHNLQJGRP KDGORQJEHHQSURXGRILWVDJULFXOWXUDOUHVRXUFHV²JUDLQZKHDW EDUOH\YHJHWDEOHVRIHYHU\GHVFULSWLRQRLOZLQHDOPRQGVVDIIURQ OLYHVWRFNJDPHILVKDQGVHDIRRG²ZLWKZKLFK9HQLFHFRXOGQHYHU

63$1,6+1$3/(6

FRPSHWH+RZHYHUWKH1HDSROLWDQHFRQRP\ZDVEDVHGRQFRPPHUFH UDWKHUWKDQSURGXFWLRQDQGVHUYLFHVUDWKHUWKDQLQGXVWU\ZLWKWKH QRWDEOHH[FHSWLRQRIWKHVWURQJORFDOFORWKPDNLQJWUDGLWLRQ)URP WKHODWHVL[WHHQWKFHQWXU\1DSOHVSURJUHVVLYHO\ORVWLWVHFRQRPLF SUHHPLQHQFH7KHVLONLQGXVWU\HQWHUHGDUHFHVVLRQDQGWKHUHZDVD QRWDEOHGURSLQGHPDQGIRUDJULFXOWXUDOSURGXFWVIURPWKHNLQJGRP $OOWKHZKLOH6SDQLVKWD[DWLRQFRQWLQXHGWRULVH 2QH RI WKH IHZ HQWUHSUHQHXULDO DFWLYLWLHV WR KDYH VXFFHVV LQ 6SDQLVK1DSOHVZDVSURVWLWXWLRQZKLFKGHYHORSHGUDSLGO\JLYHQWKH LQIOX[RI6SDQLVKWURRSVDQGWKHGHVWLWXWLRQRIWKHXUEDQSRRU$ FRQWHPSRUDU\REVHUYHUQRWHGWKDW¶DOOWKHVWUHHWVDUHIXOORIWKHP «DQGWKH\KDYHJURZQLQLQILQLWHQXPEHUV,QIDFWRYHUWKHODVWIHZ \HDUVWKH\KDYHFRPHWRWKLVFLW\IURPDOOWKHSODFHVLQWKHZRUOG EHFDXVHRIWKHIUHHGRPWKH\KDYHWROLYHKHUH7KH\SLFNWKHEHVW VWUHHWVDQGWKHEHVWVTXDUHV·7KHUHDFWLRQRIWKH6SDQLVKDXWKRULWLHV ZDVSUHGLFWDEOH²WKH\SURPSWO\EHJDQWRWD[WKHHDUQLQJVRIWKH ZRPHQLQYROYHG ,QWKHVHYHQWHHQWKFHQWXU\6SDLQHQWHUHGLQWRDSURIRXQGFULVLV (YHQ ZLWK WKH LQIOX[ RI SUHFLRXV PHWDOV IURP $PHULFD VWHHS LQIODWLRQHYHQWXDOO\EDQNUXSWHGWKH6SDQLVKPRQDUFK\$JULFXOWXUH ZDV DEDQGRQHG DQG EXUHDXFUDF\ H[HUWHG D VWUDQJOHKROG RYHU DOO FRPPHUFLDOHQGHDYRXUV7KHGHFOLQHRI0HGLWHUUDQHDQFRPPHUFH LQIDYRXURI$WODQWLFWUDGHURXWHVKDGDIXUWKHUQHJDWLYHLQIOXHQFH RQWKHFRQGLWLRQRI1DSOHVZKLOVWDFFHOHUDWLQJSUHVVXUHRIWD[DWLRQ KLJK LQIODWLRQ DQG WKH LQIOXHQFH RI D ORQJWHUP UHFHVVLRQ SXVKHG VRFLDOWHQVLRQVWRWKHLUOLPLW$QRWKHULOOLFLWHQWUHSUHQHXULDODFWLYLW\ ²UDFNHWHHULQJ²WRRNKROGDWWKLVWLPH7KH1HDSROLWDQFULPLQDO RUJDQLVDWLRQNQRZQDVFDPRUUDRULJLQDWHVIURPD6SDQLVKDVVRFLDWLRQ WKH &RQIUDWHUQLWj GHOOD *XDUGXQD IRUPHG RI VROGLHUV DQG SHWW\ FULPLQDOVDQGHVWDEOLVKHGLQ6HYLOOH7KHOHDGHUZDVFDOOHGKHUPDQR PD\RURU¶ELJEURWKHU·DQGKHPDQDJHGDQH[WUHPHO\KLHUDUFKLFDO

,17+(6+$'2:2)9(689,86

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
63$1,6+1$3/(6

UDSLGO\VSXQRXWRIFRQWURODQG0DVDQLHOORIHOOYLFWLPWRDKRPLFLGDO SORW+HZDVPXUGHUHGLQWKH&DUPHOLWHPRQDVWHU\DQGZLWKKLV GHDWKGLHGDOOKRSHVIRUWKHSROLWLFDODVSLUDWLRQVRIWKH1HDSROLWDQ OD]]DURQL7KHWD[RQIUXLWZDVQRWKLQJQHZ,WKDGEHHQDEROLVKHG DOPRVW\HDUVSUHYLRXVO\DQGUHGLVFRYHUHGRQWKHRFFDVLRQRIDQ XUJHQWUHTXHVWIURP0DGULGIRUD¶GRQDWLRQ·RIRQHPLOOLRQGXFDWV WRGHDOZLWKDVXGGHQWKUHDWIURPWKH)UHQFKIOHHW+RZHYHUWKH UHYROWZDVPRUHWKDQDTXHVWLRQRIWKHDEROLWLRQRIWKHXQSRSXODU IUXLWWD[7KHXQGHUO\LQJLVVXHZDVSROLWLFDOUHSUHVHQWDWLRQIRUDOO VRFLDOFODVVHV0DVDQLHOORDQGKLVVXSSRUWHUVSHWLWLRQHG&KDUOHV9WR JXDUDQWHHWKHUROHRIWKHSHRSOH·VHOHFWHGUHSUHVHQWDWLYHLQWKHFLYLF DGPLQLVWUDWLRQ7KHUHYROXWLRQFDQDOVREHXQGHUVWRRGZLWKLQWKH FRQWH[WRIQXPHURXVSRSXODUXSULVLQJVWKURXJKRXW(XURSHGXULQJ WKHILUVWKDOIRIWKHVHYHQWHHQWKFHQWXU\ 7KHVHYHQWHHQWKFHQWXU\ZDVDOVRPHPRUDEOHIRUQDWXUDOGLVDVWHUV ²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«)LQDOO\DIWHU VRPHVRFDOOHGHDUWKTXDNHVRQWKHPRUQLQJRI'HFHPEHUDQDUFK RIILUHZDVVDLGWRKDYHEHHQVHHQIRUDEULHIWLPHWKHQIODPHVDQGD OLWWOHZD\VIURPWKHUHDJUHDWSHDNRIILUHDWWKHWRSRIWKHPRXQWDLQ

,17+(6+$'2:2)9(689,86

WKHQ DSSHDUHG WKH JUHDW SXII RI JDV WKHQ LQ D VKRUW SHULRG JUHDW WKXQGHUHQRUPRXVGDUNQHVVFORXGVRIFLQGHUVPRUHIXPHVDUDLQRI VWRQHVDVKHVULYHUVRIILUHPRUHKROHVDQGDJXVKRIZDWHUIRUIRXU GD\VWKHUHZDVHQRUPRXVWXUPRLOWKHQMXVWWKHYLROHQFHRIWKHFKDVP ZLWKHDUWKTXDNHVDQGVLPXOWDQHRXVVKRZHUVRIDVKHV«

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·VIDoDGHDQGLQWHULRUDUH

63$1,6+1$3/(6

GHFRUDWHGZLWKLPDJHVRIVNXOOVDQGVNHOHWRQVEXWWKHFU\SWKROGV RSHQRVVXDULHV,QWKHHHULHGDQNDQGPXVW\FROXPEDULXPWKHPRVW IDPRXVRIDOOWKHVRXOVRISXUJDWRU\FDQEHIRXQGWKHP\VWHULRXV /XFLD 6KH PD\ KDYH EHHQ D QREOHZRPDQ DQG LW LV WKRXJKW WKDW VKH GLHG SUHPDWXUHO\ LQ D ERDWLQJ DFFLGHQW EHIRUH KHU PDUULDJH WRWKHPDQVKHORYHG$FFRUGLQJWRSRSXODUEHOLHIE\SUD\LQJWR /XFLD RQH FDQ UHFHLYH GLYLQH DVVLVWDQFH LQ HYHQ WKH PRVW GHOLFDWH DQG FRPSOLFDWHG PDWWHUV RI WKH KHDUW7KH FXOW RI WKH 0DGRQQD GHOO·$UFR LV EDVHG RQ WKH YHQHUDWLRQ RI D PLUDFXORXV 0DGRQQD ORFDWHG DORQJ WKH URDG IURP FHQWUDO 1DSOHV WR WKH$UFR GLVWULFW 2Q(DVWHU0RQGD\LQWKHIHHWRIDZRPDQQDPHG$XUHOLD ZKR KDG EODVSKHPHG WKH 0DGRQQD VXGGHQO\ EHFDPH GHWDFKHG IURPKHUERG\+HUIHHWDUHVWLOOFRQVHUYHGWRGD\LQWKH0DGRQQD GHOO·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·V+RVSLWDOZDVHVWDEOLVKHGQRWIRU ORFDOLQYDOLGVEXWIRUSLOJULPVHQFRXQWHULQJKHDOWKSUREOHPVZKLOH YLVLWLQJWKHFLW\·VPDQ\UHOLJLRXVVKULQHV$ODUJHRUSKDQDJHLQYLD

,17+(6+$'2:2)9(689,86

7ROHGRORRNHGDIWHUWKHPDQ\DEDQGRQHGLQIDQWVLQDFLW\ULIHZLWK SRYHUW\DQGSURVWLWXWLRQ7KHVHFKLOGUHQZHUHJHQHUDOO\JLYHQWKH &KULVWLDQQDPHFRUUHVSRQGLQJWRWKHVDLQW·VGD\RQZKLFKWKH\ZHUH DEDQGRQHGDQGWKHVXUQDPH(VSRVLWRPHDQLQJ¶IRXQGOLQJ·,WLVVWLOO DFRPPRQ1HDSROLWDQVXUQDPHLQGLFDWLQJWKHYDVWH[WHQWRIWKLV SKHQRPHQRQ7KRVHZKREHDUWKHQDPHGRVRZLWKSULGHDZDUH WKDW EOXH EORRG OLNHO\ IRUPV D VXEVWDQWLDO SDUW RI WKHLU KHULWDJH $QRWKHU FRQWHPSRUDU\ VRFLDO SUREOHP ZDV XVXU\ +LVWRULFDO GRFXPHQWVLQGLFDWHGWKDWLWZDVFRPPRQSODFHLQ1DSOHVDQGPDQ\ SDUWVRI6RXWKHUQ,WDO\IURPWKHHDUO\SDUWRIWKHVL[WHHQWKFHQWXU\ ,QRUGHUWRHOLPLQDWHWKHSUDFWLFHWZR1HDSROLWDQFLWL]HQV²$XUHOLR 3DSDURDQG/HRQDUGRGL3DOPD²HVWDEOLVKHGDUHOLJLRXVIRXQGDWLRQ WKH6DFUR0RQWHGL3LHWjWRJUDQWWKHSRRUVHFXUHGORDQVRIXSWR WHQ GXFDWV IUHH RI LQWHUHVW LQ DFFRUGDQFH ZLWK WKH FDQRQV RI WKH &KXUFKZKLFKIRUEDGHXVXU\2WKHUEDQNVZKLFKRSHQHGODWHUKDYH QDPHV ZKLFK UHIOHFW WKHLU UHOLJLRXV DQG FKDULWDEOH RULJLQV %DQFR GHOOR6SLULWR6DQWR%DQFR$YH*UDWLD3OHQD%DQFRGL6DQWD0DULD GHO3RSROR%DQFRGHO6DQWLVVLPR6DOYDWRUH :LWKWKHSRVVLEOHH[FHSWLRQRI5RPHWKH&RXQWHU5HIRUPDWLRQ ²ZKLFKDWWHPSWHGWRDSSO\WKHGLFWDWHVRIWKH&RXQFLORI7UHQWWR KDOWWKHUDPSDQWVSUHDGRI3URWHVWDQWLVP²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

63$1,6+1$3/(6

LQLWLDWLYHV:KHQ&DWKROLF(QJOLVKZRPDQ0DU\:DUGIRXQGHURIWKH /RUHWRRUGHUYLVLWHG1DSOHVVKHZDVDSSDOOHGWRVHHWKDWFKDULWDEOH ZRUNZDVEHLQJQHJOHFWHGGHVSLWHWKHPDQ\UHOLJLRXVLQVWLWXWLRQVLQ WKHFLW\6RPHRUGHUVVXFKDVWKH-HVXLWVDQGWKH7KHDWLQHVKDGVXFK VXPSWXRXV SURSHUWLHV WKDW WKH IXUQLVKLQJV RI MXVW RQH PRQDVWHU\ FRXOGKDYHSURYLGHGIRUWKHQHHGVRIPDQ\GHVWLWXWHFLWL]HQV9DVW VXPVFRQWLQXHGWREHVSHQWRQEXLOGLQJDQGGHFRUDWLQJFKXUFKHV DQGPRQDVWHULHV0DU\REVHUYHGWKDWRYHUFORLVWHUHGQXQVLQ WKHFLW\ZHUHDOLHQDWHGDQGLGOHVKHVXJJHVWHGWKH\EHIUHHGIURP WKHLUUXOHLQRUGHUWREHDEOHWRGHGLFDWHWKHPVHOYHVPHDQLQJIXOO\ WRWKHQHHGVRIWKHPRVWYXOQHUDEOHPHPEHUVRIVRFLHW\$VDUHVXOW RIKHUEROGSURSRVDO0DU\ZDVSODFHGXQGHULQYHVWLJDWLRQE\WKH RIILFH RI WKH ,QTXLVLWLRQ 5HJDUGOHVV RI WKLV VHWEDFN VKH UHWXUQHG WR %ULWDLQ ZKHUH VKH FRQWLQXHG WR SURPRWH ZRPHQ·V HGXFDWLRQ 7RGD\/RUHWR6FKRROVFDQEHIRXQGWKURXJKRXWWKHZRUOG$QRWKHU GHYRXW &DWKROLF ODG\ ZKR VRXJKW WR DGGUHVV WKH SUREOHPV RI WKH XUEDQ SRRU ZDV 6LVWHU 2UVROD %HQLQFDVD 6KH PRYHG WR WKH 6DLQW (OPR&DVWOHDERYHWKHFLW\ZLWKDVPDOOJURXSRIQXQVDQGIRXQGHG WKH &RQJUHJDWLRQ RI WKH 0RVW +RO\ &RQFHSWLRQ RI 0DU\ ZKLFK HVWDEOLVKHGDJLUOV·VFKRRO6DLQW2UVROD·VFRQYHQWLVQRZWKHKRPH RIWKH¶6XRU2UVROD%HQLQFDVD·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·PDQ\SDWURQVDLQWV WKHRULJLQDOVHYHQZHUHMRLQHGE\DIXUWKHUQHZSURWHFWRUVGXULQJ

,17+(6+$'2:2)9(689,86

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·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

63$1,6+1$3/(6

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·VSDVVLRQDWHQDWXUH+HZDVFRPPLVVLRQHGWRSDLQW WKH 6HYHQ$FWV RI 0HUF\ IRU WKH 3LR 0RQWH GHOOD 0LVHULFRUGLD RQH RI WKH SULQFLSDO FKDULWDEOH LQVWLWXWLRQV RI WKH FLW\ ,W LV JHQHUDOO\ FRQVLGHUHGWREHRQHRIKLVPRVWDFFRPSOLVKHGZRUNV$FFRUGLQJWR &DWKROLFWUDGLWLRQWKHVHYHQDFWVRIFRUSRUDOPHUF\DUHWRIHHGWKH KXQJU\WRJLYHGULQNWRWKHWKLUVW\WRFORWKHWKHQDNHGWRKDUERXU WKHKRPHOHVVWRYLVLWWKHVLFNWRUDQVRPWKHFDSWLYHLHWRYLVLW SULVRQHUV DQG WR EXU\WKHGHDG ,QRQHFRPSOH[ UHSUHVHQWDWLRQ &DUDYDJJLR·VSDLQWLQJLQFOXGHVDOOVHYHQDFWVRIPHUF\LQDQHODERUDWH JURXSLQJ RI ILJXUHV7KH RZQHU RI D KRVWHOU\ LQYLWHV WUDYHOOHUV WR HQWHU6DPSVRQGULQNVZDWHUIRXQGPLUDFXORXVO\LQWKHGHVHUWDQG WKHIHHWRIDFDGDYHUDUHYLVLEOH+RZHYHUWKHPRVWXQXVXDOLPDJHLV XQGRXEWHGO\WKDWRID\RXQJZRPDQEUHDVWIHHGLQJDQHOGHUO\PDQ DGHSLFWLRQRIWKHWDOHRI5RPDQ&KDULW\IUHTXHQWO\GHSLFWHGLQWKH VHYHQWHHQWK FHQWXU\ 3HUR·V IDWKHU &LPRQH ZDV LPSULVRQHG DQG EHLQJVWDUYHGWRGHDWK+LVGDXJKWHUKDGUHFHQWO\JLYHQELUWKDQG ZDVDOUHDG\EUHDVWIHHGLQJKHURZQFKLOGVRRQGDLO\YLVLWVWRKHU IDWKHU LQ SULVRQ VKH IHG KLP LQ WKH VDPH ZD\ WKHUHE\ VDYLQJ KLV OLIH6RPRYLQJZDVWKLVH[DPSOHRIGDXJKWHUO\ORYHWKDWWKHMXGJHV FRPSDVVLRQDWHO\GHFLGHGWRUHOHDVH&LPRQH2QRQHOHYHOWKHVFHQH

,17+(6+$'2:2)9(689,86

&DUDYDJJLR7KH6HYHQ$FWVRI0HUF\

63$1,6+1$3/(6

DSSHDUVWRGHSLFWFRQWHPSRUDU\OLIHLQD1HDSROLWDQVWUHHW\HWLWLV DOVRULFKZLWKVRSKLVWLFDWHGDOOHJRU\IURPERWKELEOLFDODQGFODVVLFDO VRXUFHV$QRWKHU&DUDYDJJLRPDVWHUSLHFHSDLQWHGGXULQJKLVWLPHLQ 1DSOHVLVWKHGUDPDWLFDOO\LOOXPLQDWHG)ODJHOODWLRQRI&KULVW &DUDYDJJLR SURYLGHG WKH IRXQGDWLRQ IRU WKH GHYHORSPHQW RI D 1HDSROLWDQQDWXUDOLVWVFKRRORISDLQWLQJ7KHVWDUNUHDOLVPDQGYLYLG FRQWUDVWVRI&DUDYDJJLR·VFDQYDVVHVDZDNHQHGWKHSDVVLRQDWHLQVWLQFWV RIPDQ\1HDSROLWDQSDLQWHUVZKRIROORZHGWKHQDWXUDOLVWLFWUHQGRI KLVDUWDQGEHFDPHNQRZQDVWKHWHQHEURVLIRUWKHLUXVHRIGDUNFRORXUV DQG GUDPDWLF FKLDURVFXUR OLJKWLQJ %DWWLVWHOOR &DUDFFLROR RIIHUHG D PHODQFKRO\DQGO\ULFDOLQWHUSUHWDWLRQRI&DUDYDJJLR·VWHFKQLTXHLQ KLVHDUOLHVWVXUYLYLQJZRUNWKH,PPDFXODWH&RQFHSWLRQ+HZHQWRQ WRGHFRUDWHWKH&KXUFKRI6DQ'LHJRDOO·2VSHGDOHWWRDQGWKHFKDSHO GHGLFDWHG WR 6DQ *HQQDUR LQ WKH &KDUWHUKRXVH RI 6DLQW 0DUWLQ ZKLFKQDUUDWHVWKHOLIHRIWKHFLYLFSDWURQDQGKLVPLUDFOHV+HUHLQ %DWWLVWHOOR·V 6DQ*HQQDURLQJORU\ZLWKWKHVDLQWO\ELVKRSVWKHVDLQWLV GHSLFWHGWRJHWKHUZLWKVRPHRIWKHQXPHURXVRWKHUSDWURQVRI1DSOHV DQGFURZQHGE\DQJHOV7ZRFKXEE\FKHUXEVKROGWKHDPSRXOHVRI KLVPLUDFXORXVEORRG-XVHSH5LEHUDEHWWHUNQRZQDVORVSDJQROHWWR WKH OLWWOH 6SDQLDUG DOVR GUHZ RQ WKH WUDGLWLRQ RI QDWXUDOLVP +LV OLIHDQGZRUNZDVFHOHEUDWHGLQ/RUG%\URQ·V'RQ-XDQ¶6WRULHVRI PDUW\UVDZHGDV6SDJQROHWWRWDLQWHGKLVEUXVKZLWKDOOWKHEORRG RI WKH VDLQWHG· 5LEHUD·V PRVW FHOHEUDWHG ZRUN LV WKH DOWDUSLHFH RIWKHFKDSHORI6DQ*HQQDURLQWKHFDWKHGUDOZKLFKGHSLFWVWKH PLUDFOH RI WKH VDLQW OHDYLQJ ILUH ZLWKRXW LQMXU\ 7KH PLUDFOH RI WKH IODPHV GHVFULEHV DQ DSRFU\SKDO OHJHQG RI WKH ILQDO VXIIHULQJV RI6DQ*HQQDUR,WLVVDLGWKDWZKHQKHZDVILUVWLPSULVRQHGE\WKH 5RPDQDXWKRULWLHV*HQQDURKDGEHHQFRQGHPQHGWREHEXUQHGWR GHDWKEXWWKHIODPHVGLGQRWKXUWKLPDVKHURDVWHGDWWKHVWDNHDQG ZKHQKHZDVVXEVHTXHQWO\IHGWRWKHOLRQVLQWKHDPSKLWKHDWUHRI 3R]]XROLWKHIHURFLRXVEHDVWVRQO\FXGGOHGKLPSOD\IXOO\ 5LEHUD

,17+(6+$'2:2)9(689,86

IRUPHGDFORVHERQGZLWK%DWWLVWHOORDQGZLWK%HOLVDULR&RUHQ]LR D*UHHNSDLQWHUOLYLQJLQ1DSOHV,WZDVUXPRXUHGWKDWQRSDLQWHU FRXOGH[HFXWHDPDMRUFRPPLVVLRQLQWKHFLW\ZLWKRXWWKHLUFRQVHQW 7KH\DUHWKRXJKWWRKDYHGULYHQDZD\PDQ\HPLQHQWDUWLVWVLQYLWHG WRGHFRUDWHWKHFLW\·VPRVWKRO\VKULQHWKHFKDSHORI6DQ*HQQDUR LQWKH&DWKHGUDO*XLGR5HQL·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·VSDLQWLQJIRUWKHHQWUDQFHWRWKH&KDUWHUKRXVH RI6DLQW0DUWLQZDVJUHDWO\DGPLUHGXQWLO5LEHUDRIIHUHGWRFOHDQ WKHSDLQWLQJDQG¶DFFLGHQWDOO\·UXLQHGLWZLWKDFRUURVLYHOLTXLG ,Q D UHDFWLRQ DJDLQVW QDWXUDOLVP DQG WKH QHJDWLYH UHSXWDWLRQ LW ZDVDFTXLULQJLQDUWLVWLFFLUFOHVDUWLVWVVXFKDV/XFD*LRUGDQRDQG )UDQFHVFR 6ROLPHQD EHJDQ WR XVH D PRUH OXPLQRXV SDOHWWH /XFD *LRUGDQRVSHQWWHQ\HDUVLQ6SDLQIUHVFRLQJWKH(VFRULDODQG%XHQ 5HWLURSDODFHVDQGWKHVDFULVW\RI7ROHGR&DWKHGUDODVZHOODVWKHUR\DO SDODFHDQGPDQ\FKXUFKHVLQ0DGULG2QKLVUHWXUQKHFRPSOHWHG D VHULHV RI UDGLDQW IUHVFRHV IRU WKH &KDUWHUKRXVH RI 6DLQW 0DUWLQ LQMXVWDIHZGD\V*LRUGDQR·VFRQWHPSRUDU\)UDQFHVFR6ROLPHQD DIIHFWHG UHOLJLRXV JDUE DQG ZDV DOVR NQRZQ DV$EDWH &LFFLR$Q (QJOLVKWUDYHOOHUZKRYLVLWHGKLVVWXGLR(GZDUG:ULJKWZURWH

63$1,6+1$3/(6

6ROLPHQHZDVHVWHHP·GWKHFRPSOHDWHVW0DVWHULQ,WDO\«:HZHQW WRSD\DYLVLWWRWKLVH[FHOOHQW0DVWHUDQGIRXQGKLPYHU\FLYLODQG REOLJLQJ QRWZLWKVWDQGLQJ VRPH UHSRUWV ZH KDG KHDUG RI KLP WR WKH FRQWUDU\ +H GUHVVHV DV DQ HFFOHVLDVWLF ZKLFK LV YHU\ IUHTXHQW WKHUH ZLWKWKRVHWKDWDUHQRWLQRUGHUV%HVLGHVRWKHUSLHFHVRIKLVZRUNKH VKRZHGXVDODUJHRQHKHZDVGRLQJIRU3ULQFH(XJHQHWKHVWRU\RI &HSKDOXVDQG$XURUDH[WUHPHO\EHDXWLIXO$V,UHPHPEHU·WLVWKDWSDUW RIWKHVWRU\ZKHUH$XURUDLVWDNLQJXS&HSKDOXVLQWR+HDYHQZKLFK VKHLVVDLGWRKDYHGRQHZKHQDOORWKHUPHDQVVKHKDGXVHGWRLQGXFH KLPWRDEUHDFKRIKLVFRQMXJDOYRZWR3URFULVKDGSURYHGLQHIIHFWXDO

7KHDSRJHHRI6ROLPHQD·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·VPRVWIDPRXVYHUVHLVHPEOHPDWLFRIKLVFDOOLQJ ËGHOSRHWD LOÀQODPHUDYLJOLD ¶:RQGHUPHQW²¶WLVWKHSRHW·VDLP· 0DULQR·V SRHWU\LVZRUOGO\DQGKHGRQLVWLFIUHHIURPDQ\PRUDORULGHRORJLFDO WHQVLRQ DQG KH H[HUFLVHG D FRQVLGHUDEOH LQIOXHQFH QRW RQO\ XSRQ FRQWHPSRUDU\ SRHWU\ EXW XSRQ SDLQWLQJ DV ZHOO 6WDQ]LRQH·V

,17+(6+$'2:2)9(689,86

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·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

63$1,6+1$3/(6

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·V ORYHU7KH VXEVHTXHQW WULDO ODVWHG RQO\ RQH GD\ EHIRUH *HVXDOGR ZDV DEVROYHG ¶JLYHQ WKH ZHOONQRZQ MXVW FDXVH ZKLFK JXLGHG KLP· *HVXDOGR EHFDPH LQFUHDVLQJO\ PRRG\ DQG PHODQFKRO\ DQG GHGLFDWHGKLPVHOIREVHVVLYHO\WRKLVPXVLF(YHQDVHFRQGPDUULDJH WR(OHRQRUDG·(VWHRI)HUUDUDFRXOGQRWSDFLI\KLP,QH[SLDWLRQ IRUKLVFULPHWKHUHPRUVHIXOSULQFHIRXQGHGWZRPRQDVWHULHVLQ KLVIHXGDOVHDWRQHIRUWKH'RPLQLFDQVDQGRQHIRUWKH&DSXFKLQV *HVXDOGRZURWHVL[YROXPHVRIILYHSDUWPDGULJDOVWZRERRNVRI PRWHWVDQGVRPHNH\ERDUGZRUNV7KHYLROHQWFRQWUDVWVRIWHPSR DQGFRPSOH[FKURPDWLFKDUPRQ\LQKLVPXVLFVHHPWRUHIOHFWKLV HPRWLRQDOSHUVRQDOLW\LQWKHLUVXGGHQGUDPDWLFFKDQJHVLQKDUPRQ\ DQG LQWHQVLW\ RI IHHOLQJ *HVXDOGR·V DYDQWJDUGH H[SHULPHQWDWLRQ KDGDSURIRXQGHIIHFWRQWKHFRPSRVLWLRQVRIWKHPRVWLPSRUWDQW 1HDSROLWDQPXVLFLDQVERWKVDFUHGDQGVHFXODU

,17+(6+$'2:2)9(689,86

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·VELWHFDXVHGDGLVHDVHNQRZQDVWDUDQWLVP ZKRVH RQO\ FXUH ZDV WKH SHUIRUPDQFH RI D IUHQ]LHG GDQFH ² WKH WDUDQWHOOD,QDFWXDOIDFWWKHVSLGHU·VELWHLVFRPSDUDWLYHO\KDUPOHVV DQGWKHGLVHDVHDQGLWVFXUHDUHSUREDEO\QRPRUHWKDQDK\VWHULFDO UHDFWLRQ WR WKH FUHHS\ FUDZO\ 6DPXHO 3HS\V UHFRUGV KLV PHHWLQJ ZLWKDJHQWOHPDQZKRKDGMXVWUHWXUQHGIURPWUDYHOVLQ6RXWKHUQ ,WDO\¶VSHDNLQJDERXWWKHWDUDQWXODKHVD\VWKDWDOOWKHKDUYHVWORQJ DERXWZKLFKWLPH WKH\ DUH PRVW EXV\ WKHUH DUH ILGGOHUV ZKR JR XSDQGGRZQWKHILHOGVHYHU\ZKHUHLQH[SHFWDWLRQRIEHLQJKLUHG E\WKRVHWKDWDUHVWXQJ·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pH

63$1,6+1$3/(6

7KLVLVWKHPXFKFHOHEUDWHG3RVLOOLSRZKLFKLQWKHKHDWRIWKHVXPPHU OHDGV1DSOHVWRIRUJHWLWVRWKHUGHOLJKWV6LQFHLWLVQRPRUHWKDQWZR PLOHVDZD\WKHPRVWEHDXWLIXOODGLHVDQGQREOHJHQWOHPHQFRPHWR SDUDGHWKHPVHOYHVWKHRWKHUWRZQVPHQDQGIRUHLJQHUVFRPHWRHQMR\ OLIHDQGDOOWKHWURXEOHVRIWKHSDVWDUHFRYHUHGE\VZHHWREOLYLRQ« +HUH WKH PRVW H[WUDRUGLQDU\ IHDVWV DUH KHOG ZLWK PRVW VXPSWXRXV EDQTXHWVDQGWKHQDOOWKHVHDLVILOOHGZLWKERDWVDOOY\LQJZLWKHDFK RWKHUDGRUQHGZLWKYDULRXVEDQQHUVDQGIXOORIODGLHVDQGJHQWOHPHQ VRPHWKLQJWKDWLVZHOOZRUWKVHHLQJ%H\RQGDOOWKLVLWLVFXVWRPDU\ IRUH[FHOOHQWPXVLFLDQVWRJDWKHUWRJHWKHULQPDQ\RIWKHERDWV7KHVH VLQJLQJDQGSOD\LQJWKHLUYDULRXVLQVWUXPHQWVILOOWKHDLUWKHVHDDQG WKHHDUWKZLWKPDQ\KDUPRQLHV

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«DQGRQHFDQDOVRVHHWKDWQRQDWLRQ LQ,WDO\LVFORVHUWRWKH)UHQFKWKDQ1DSOHVWKHVHQWLPHQWLVVWURQJRQ WKHLUSDUWWRR

6XFKZDVWKHSUHVWLJHRIWKH1HDSROLWDQPXVLFDOWUDGLWLRQWKDWD IHZWDOHQWHGDUWLVWVDFKLHYHG(XURSHDQIDPH*LDPEDWWLVWD%DVLOH·V VLVWHUZDVNQRZQIDUDQGZLGHDVODEHOOD$GULDQD$YLUWXRVRVLQJHU WDOHQWHG JXLWDULVW DQG KDUSLVW VKH ZDV WKH PRVW IDPRXV IHPDOH PXVLFLDQRIKHUGD\LQ1DSOHV$ERRNZDVHYHQZULWWHQHQWLWOHG,O

,17+(6+$'2:2)9(689,86

WHDWURGHOOHJORULHGL$GULDQD%DVLOHLQZKLFKVHYHUDOSRHWVGHGLFDWHG HQFRPLXPYHUVHVWRKHUVRPHLQWKHIRUPRIVRQQHWVRUPDGULJDOV *LDPEDWWLVWD0DULQRSUDLVHGKHUPXVLFDOVNLOOVDQGSHUVRQDOFKDUP LQKLVPRVWIDPRXVSRHPWKH$GRQH 7DOIRUVHLQWHQHULUFROGROFHFDQWR 6XROODEHOOD$GULDQDLGROFLDIIHWWL (FRQODYRFHHFRQODYLWDLQWDQWR ,USHUGXHVWUDGHDVDHWWDUHLSHWWL 7KXVEHDXWLIXO$GULDQDVHHNVZLWKKHUVZHHWVRQJWREULQJIRUWKVZHHW VHQWLPHQWVDQGZLWKKHUOLIHDQGKHUYRLFHVKHJRHVDORQJWKHVWUHHWV ODXQFKLQJFXSLG·VDUURZV

7KH'XNHRI0DQWXD9LQFHQ]R*RQ]DJDZDVGHWHUPLQHGWROXUH WKH¶VLUHQDGL3RVLOOLSR·WRKLVFRXUWDWDQ\SULFHWRSHUIRUPZLWK &ODXGLR0RQWHYHUGLWKHFKDSHOPDVWHU 6WXGHQWVLQWKHFRQVHUYDWRULHVEHJDQWRVWDJHVPDOOVFDOHWKHDWULFDO SHUIRUPDQFHVRQVDFUHGWKHPHV7KHVHHQMR\HGH[WUDRUGLQDU\VXFFHVV IRURYHUKDOIDFHQWXU\DQGZHUHUHFLWHGLQFKXUFKHVUR\DOSDODFHV DQGWKHKRPHVRIWKHQRELOLW\1DSOHVDOUHDG\KDGDVWURQJFRPPHGLD GHOO·DUWHWUDGLWLRQRIIDUFLFDOVWRFNFKDUDFWHUVOLNH3XOFLQHOODZKLFK FDPHWREHFHOHEUDWHGWKURXJKRXW(XURSH7KHSULQFLSDOLQYHQWRU RI WKH 3XOFLQHOOD PDVN ZDV WKH 1HDSROLWDQ DFWRU 6LOYLR )LRULOOR )LRUHOOR·V3XOFLQHOODZDVDQH[XEHUDQWVLPSOHWRQZKRPDGHKLVZD\ LQOLIHE\UHO\LQJRQVWUHHWVPDUWVDFTXLUHGLQ1DSOHV)LRUHOOR·VVRQ 7LEHULREURXJKWWKHUROHRI6FDUDPRXFKHWROLIHDQGEHFDPHWKH PRVWIDPRXVFRPLFDFWRURIKLVGD\LQ)UDQFH$IWHU7LEHULR·VGHDWK DQLPDJLQDU\DQGURPDQWLFLVHGELRJUDSK\RI6FDUDPRXFKHLQFUHDVHG WKHDFWRU·VIDPH6FDUDPRXFKHZDVDORXGDQGUDPEXQFWLRXVODGLHV· PDQ ZLWK DQ RXWVWDQGLQJ H[SUHVVLYH TXDOLW\ DFUREDWLF VNLOOV DQG FRPLF WLPLQJ ZKR FDSWXUHG WKH DWWHQWLRQ RI 3DULVLDQ DXGLHQFHV ZKHQKHSHUIRUPHGDVSDUWRIWKH&RPpGLHLWDOLHQQH+HZRXOGDSSHDU

63$1,6+1$3/(6

RQVWDJHLQDEODFNFRVWXPHZLWKDZKLWHFROODUDQGZKLWHPDNHXS ZKLFKHPSKDVLVHGKLVGDUNPRXVWDFKHDQGH\HEURZV 7KHYLEUDQWFXOWXUDOODQGVFDSHRI6SDQLVK1DSOHVZDVQRWUHVWULFWHG WRWKHDUWV1DSOHV·DFDGHPLFWUDGLWLRQPDGHLWDFHQWUHRIVFLHQWLILF DQGSKLORVRSKLFDODFKLHYHPHQWV*HRJUDSKLFDOGLVFRYHULHVWUDYHOVWR XQNQRZQODQGVDQGWKHVWXG\RIGLVFLSOLQHVVXFKDVDVWURQRP\UHVXOWHG LQDQHZFRQVFLRXVQHVVRIWKHSUHFDULRXVUHODWLRQVKLSEHWZHHQPDQ DQGQDWXUH6HYHUDOLQWHOOHFWXDOVEHJDQWRUHYLVLW(SLFXUHDQWKRXJKW ZKLFKKDGEHHQVRLQIOXHQWLDOLQDQFLHQW1HDSROLV7KH\ZHUHJUHDWO\ LQWHUHVWHGLQDWRPLVPWKHQRWLRQWKDWPDWWHULVPDGHXSRIVPDOO LQGLYLVLEOHSDUWLFOHV7KH(SLFXUHDQHWKLFDOV\VWHPRI/XFUHWLXVVHW RXWLQKLVSRHP'H5HUXP1DWXUDZDVUHGLVFRYHUHGZKHQWKHWH[WZDV SXEOLVKHG5HYLYHGDWRPLVPJDYHULVHWRDFRUSXVFXODUGRFWULQHWKDW SURYLGHGWKHPDWHULDOIRXQGDWLRQRIWKHPHFKDQLVWLFSKLORVRSK\RI WKHVHYHQWHHQWKFHQWXU\%HUQDUGLQR7HOHVLR·VWUHDWLVH 'HUHUXPQDWXUD LX[WD SURSULD SULQFLSLD EDVHG RQ WKH ZULWLQJV RI /XFUHWLXV VHHPHG WR VXEYHUW WKH SULQFLSOHV RQ ZKLFK 6FKRODVWLF WKRXJKW ZDV EDVHG 7HOHVLREHOLHYHGDOONQRZOHGJHZDVVHQVDWLRQDQGWKHUHIRUHFRQFHLYHG LQWHOOLJHQFH DV D FROOHFWLRQ RI VHQVRU\ GDWD7HOHVLR·V ZULWLQJV JDYH ULVHWRKHDWHGSXEOLFGHEDWHDQGDQLPDWHGGLVFXVVLRQVEHWZHHQWKH SKLORVRSKHU·VIROORZHUVDQGVWUHQXRXVVXSSRUWHUVRIWKH$ULVWRWHOLDQ V\VWHP7HOHVLR·VERRNVZHUHSODFHGRQWKHLQGH[DIWHUKLVGHDWK 7HOHVLR·VSKLORVRSK\ZDVLQIOXHQWLDORQWKHZULWLQJVRIWZRRWKHU 1HDSROLWDQLQWHUSUHWHUVRI5HQDLVVDQFHQDWXUDOLVPWKH'RPLQLFDQ IULDUV 7RPPDVR &DPSDQHOOD DQG *LRUGDQR %UXQR &DPSDQHOOD DUJXHG WKDW WUXWK DERXW QDWXUH LV QRW UHYHDOHG LQ VFULSWXUH DQG FODLPHGIUHHGRPRIWKRXJKWLQSKLORVRSKLFDOVSHFXODWLRQ+HLQVLVWHG XSRQMRLQLQJSKLORVRSK\PHWDSK\VLFVWKHRORJ\DQGWKHQHZQDWXUDO VFLHQFHDQGWRKDUQHVVWKHPWRWKHFDXVHRIFLYLOZHOIDUH+LVIDPRXV XWRSLDQ WUHDWLVH &LW\ RI WKH 6XQ ERUH OLWWOH LI DQ\ UHVHPEODQFH WR OLIHLQFRQWHPSRUDU\1DSOHVEXWLVUDWKHUDQLGHDOLVHGGHVFULSWLRQ

,17+(6+$'2:2)9(689,86

RIWKHVRFLHW\KHKDGKRSHGZRXOGRQHGD\HPHUJH+LHUDUFKLFDO LQ VWUXFWXUH EXW HJDOLWDULDQ LQ VSLULW &DPSDQHOOD·V XWRSLD LV D SRZHUIXOVWDWH ZLWK LQWHUHVWV LGHQWLFDO WR WKRVH RI LWV FLWL]HQV$OO SRVLWLRQVRIDXWKRULW\DUHZRQDQGKHOGE\PHULWDORQHHYHU\FLWL]HQ FRQWULEXWHVKLVSK\VLFDOODERXULQVRPHPHDVXUHLQWKHSHUIRUPDQFH RIHVVHQWLDOWDVNVDQGDOODGXOWVRIERWKVH[HVDUHVXEMHFWWRPLOLWDU\ VHUYLFHZKHQUHTXLUHG7KHXQLWDU\IDPLO\DQGSULYDWHRZQHUVKLS RI SURSHUW\ DUH ERWK SURKLELWHG EHFDXVH WKH\ OHDG WR HJRWLVP$ /DWLQWUDQVODWLRQZDVSXEOLVKHGLQ)UDQNIXUWDQGGLVVHPLQDWHGKLV LGHDVWKURXJKRXW(XURSH2QHRI&DPSDQHOOD·VPDMRUJRDOVZDVWKH UHFRQFLOLDWLRQ RI 5HQDLVVDQFH QDWXUDOLVP DQG &DWKROLF RUWKRGR[\ EXWKHZDVVLQJXODUO\XQVXFFHVVIXOLQWKLVHQGHDYRXU+HZDVDFFXVHG RIKHUHV\DQGLQFDUFHUDWHGLQWKH6DLQW(OPR&DVWOHZKHUHKHZDV FKDLQHGDQGWRUWXUHGLQDGDQNZLQGRZOHVVGXQJHRQ(YHQWXDOO\KH IHLJQHGPDGQHVVLQRUGHUWREHIUHHG &DPSDQHOOD VKDUHG D ODWHU LPSULVRQPHQW LQ 5RPH ZLWK IHOORZ 1HDSROLWDQ*LRUGDQR%UXQRRQHRIWKHOLYHOLHVWPLQGVRIWKHVL[WHHQWK FHQWXU\%UXQR·VZULWLQJVH[SUHVVKLVUHYHUHQWDZHIRUWKHLQILQLW\ RIWKHQDWXUDOZRUOGDOWKRXJKWKLVGLGQRWLQDQ\ZD\FDXVHKLPWR GLVFXVVRUFRQWHVWWKHJUHDWQHVVRI*RG¶7KXVWKHH[FHOOHQFHRIJRG LVPDJQLILHGDQGWKHVL]HRIKLVHPSLUHLVPDQLIHVW+HLVQRWJORULILHG LQRQO\RQHEXWLQQXPHURXVVXQVQRWLQRQHHDUWKRQHZRUOGEXW LQWZRWKRXVDQG,VD\LQLQILQLWHZRUOGV·%UXQR·VQDWXUDOLVPZDV VXVSHFWDQGKHWRRZDVUHSRUWHGWRWKH,QTXLVLWLRQDQGDUUHVWHG $IWHUHLJKW\HDUVRIGHWHQWLRQDQGWRUWXUHDQGUHLWHUDWHGUHIXVDOVWR DEMXUHKLVZULWLQJVKHZDVEXUQHGDWWKHVWDNHLQ&DPSRGH·)LRULLQ 5RPHWREHPRXUQHGE\JHQHUDWLRQVRIOLEHUDOWKLQNHUVLQ,WDO\DQG ZRUOGZLGH%UXQR·VXQGHUVWDQGLQJRIPRGHUQFRVPRORJ\PD\QRW KDYHKDGDJUHDWLQIOXHQFHRQKLVFRQWHPSRUDULHVEXWLWZDVWDNHQ XSDJDLQDIWHU*DOLOHR·VGLVFRYHULHVDQGWRGD\LVFRQVLGHUHGWREHWKH EDVLVRIPRGHUQVFLHQWLILFWKRXJKW

63$1,6+1$3/(6

6HYHUDODFDGHPLHVDORQJWKHOLQHVRIWKH5R\DO6RFLHW\RI/RQGRQ RUWKH$FDGpPLHGHV6FLHQFHVRI3DULVZHUHHVWDEOLVKHGLQ1DSOHV WRSURPRWHUHVHDUFKDQGGLVFXVVLRQ*LRYDQQL%DWWLVWDGHOOD3RUWD IRXQGHGWKHILUVWVFLHQWLILFVRFLHW\WKH$FFDGHPLDGH·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¶DQFLHQWV·WKRVHJXLGHGE\ WKHSULQFLSOHVRI$ULVWRWHOLDQLVP DQGWKH¶PRGHUQV·IROORZHUVRI 'HVFDUWHV DQG UDWLRQDOLVP 7KH XQLYHUVLW\·V VWDWXWH ZDV XSGDWHG PRGHOOHGRQWKDWRIWKHSUHVWLJLRXV6SDQLVKXQLYHUVLW\RI6DODPDQFD DQGWKHLQVWLWXWLRQPRYHGWRDQHZSUHVWLJLRXVEXLOGLQJWRGD\WKH 1DWLRQDO$UFKDHRORJLFDO0XVHXP 0DQ\ LPSUHVVLYH EXLOGLQJV ERWK SXEOLF DQG SULYDWH ZHUH EXLOW LQ1DSOHVWKURXJKRXWWKHILIWHHQWKDQGVL[WHHQWKFHQWXULHV3DOD]]R )LUUDR LQ YLD &RVWDQWLQRSROL LV W\SLFDO RI WKH RSXOHQFH RI KRPHV GHVLJQHGWRXQGHUVFRUHWKHLURZQHUV·VRFLDOSUHVWLJH7KHPDQQHULVW VW\OHIDoDGHGHVLJQHGE\&RVLPR)DQ]DJRLVXQDGRUQHGLQWKHORZHU KDOIEXWWKHRUQDPHQWDWLRQRIWKHXSSHUIORRUVLQFOXGHVDVHULHVRI EXVWVRIWKH6SDQLVKNLQJVRI1DSOHV7KHVFXOSWRUDQGDUFKLWHFW*LDQ

,17+(6+$'2:2)9(689,86

/RUHQ]R%HUQLQLZDVERUQLQ1DSOHVDQGOHIWKLVPDUNRQKLVKRPH WRZQZLWKWKH VXPSWXRXV VHD PRQVWHUV VSODVKLQJ LQ WKH FHQWUH RI )RQWDQD0HGLQDDIRXQWDLQORFDWHGLQWKHVWUHHWRIWKHVDPHQDPH 7KH&KDUWHUKRXVHRI6DLQW0DUWLQKDVEHFRPHWKHHPEOHPRIEDURTXH 1DSOHV7KHLQWHULRURILWVFKXUFKZDVGHFRUDWHGZLWKFXVWRPDU\IODLU E\&RVLPR)DQ]DJRDQGFRQWDLQVZRUNVE\DOOWKHJUHDW1HDSROLWDQ DUWLVWVRIWKHVHYHQWHHQWKFHQWXU\%DWWLVWHOOR6SDJQROHWWR6WDQ]LRQH DQG $QGUHD9DFFDUR +RZHYHU WKH PRVW GLVWLQFWLYH DUFKLWHFWXUDO IHDWXUHRIWKHEDURTXHSHULRGLQ1DSOHVLVXQGRXEWHGO\WKHJXJOLH ULFKO\RUQDPHQWHGURFRFRREHOLVNVVXUPRXQWHGE\VWDWXHVRIVDLQWV RULJLQDOO\HUHFWHGLQWKDQNVIRUGHOLYHUDQFHIURPWKHSODJXH$JXJOLD KDVQRVSHFLILFIXQFWLRQRWKHUWKDQRUQDPHQWDWLRQDQGLVW\SLFDORI WKHULFKH[FHVVRIWKHDUWDQGDUFKLWHFWXUHRI6SDQLVK1DSOHV7KHUH DUHWKUHHJXJOLHLQ1DSOHVWKHJXJOLDRIWKH,PPDFXODWH&RQFHSWLRQ LQ 3LD]]D GHO *HV WKH JXJOLD RI 6DQ *HQQDUR QHDU WKH &DWKHGUDO DQGWKHJXJOLDRI6DQ'RPHQLFR0DJJLRUH(QULFR%DFFR·VJXLGHWR 1DSOHVZULWWHQLQWKHILQDO\HDUVRIWKHVL[WHHQWKFHQWXU\VLQJOHVRXW VRPHRIWKLVVSOHQGLGDUFKLWHFWXUH 7KHQXPEHURIPDUYHOORXVWKLQJVLQWKLVFLW\DQGNLQJGRPRI1DSOHVLV VRYDVW«1DSOHVKDVDOZD\VEHHQDVZHOODWWHQGHGE\WKHDJUHHDEOHQHVV RILWVVLWHDVE\WKHVWXGLHVDQGILQHDUWVWKDWIORXULVKHGLQLWDVKDGEHHQ PDGHVRFOHDUE\PDQ\ZULWHUVZKROLYHGWKHUHWRGHYRWHWKHPVHOYHV WRWKHVWXG\RIOHWWHUV«,Q1DSOHVRQHVHHVDIORXULVKLQJDQGEULOOLDQW QRELOLW\QROHVVDQFLHQWWKDQIDPRXVWKURXJKWKHGRPLQLRQRIYDVVDOV WLWOHVRIILFHVDQGGLJQLWLHVIURPHYHU\SDUWQRWRQO\RI,WDO\EXWRI WKHZRUOG«,WKDVLWVSRSXODWLRQQXPHURXVDQGFLYLOLVHGRIFKRLFH SHRSOH ZKR OLYH WKH HTXDO WR DQ\ QRELOLW\ LQ VSOHQGRXU ,W KDV WKH ULFKHVWPHUFKDQWVDQGDUWLVDQVLQJUHDWVXSSO\ZKRFRPHKHUHIURP HYHU\ZKHUH ,WV ZLGH DQG VSDFLRXV VWUHHWV DUH DGRUQHG E\ WKH PRVW QREOH DQG PDJQLILFHQW SDODFHV DQG WHPSOHV ZLWK IRXQWDLQV RI WKH FOHDUHVWDQGIUHVKHVWZDWHUZKLFKEULQJJUHDWRUQDPHQWDQGGLJQLW\ WRWKHFLW\

63$1,6+1$3/(6

)RUHLJQYLVLWRUVZHUHDVLPSUHVVHGE\WKHPDJQLILFHQFHRI1DSOHV·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

$JXLGHWRWKHFLW\LQ/DWLQHQWLWOHG0RQXPHQWRUXP,WDOLDHTXDHKRF QRVWURVDHFXORHWD&KULVWLDQLVSRVLWDVXQWZDVSXEOLVKHGLQ+HOPVWDGW LQE\WKH*HUPDQ/RUHQ]6FKUDGHUDQGDVHFRQGHGLWLRQZDV SXEOLVKHGLQ$YHU\EDVLFWRXULVWHFRQRP\HPHUJHGDQGH[FXU VLRQVZHUHUHJXODUO\PDGHWRVRPHRIWKHFLW\·VPRVWXQXVXDODQG LQWULJXLQJVLWHV)HUUDQWH,PSHUDWR·VPXVHXPRIQDWXUDOKLVWRU\ZDV SRSXODUZLWKYLVLWRUV$FRQWHPSRUDU\JXLGHUHFRPPHQGVDYLVLW

,17+(6+$'2:2)9(689,86

WKRXVDQGVLPSOHWHUUHVWULDOPDULWLPHDQGDLUERUQHH[KLELWVZLWKWKH VXUSULVHRIWKRVHZKRDUHRIWKHSURIHVVLRQDQGWKHUHIRUHYLVLWHGE\DOO WKHJUHDW/RUGVZKLFKZDONLQWKHZRUOG

6SHFLDOLVWV DQG WKH FXULRXV FDPH IURP DOO RYHU (XURSH DQG WKH PXVHXP ZDV YLVLWHG E\ SK\VLFLDQV DQG QDWXUDOLVWV 7KH (QJOLVK GLDULVW-RKQ(YHO\QZDVVRWDNHQZLWK1DSOHVWKDWKHGHILQHGLWWKH ¶QRQSOXVXOWUDRIP\WUDYHOV·+HGHVFULEHVWKHFLW\·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«WKHEXLOGLQJRIWKHFLW\LVIRUWKH VL]HWKHPRVWPDJQLILFHQWRIDQ\LQ(XURSHWKHVWUHHWVH[FHHGLQJODUJH ZHOOSDYHGKDYLQJPDQ\YDXOWVDQGFRQYH\DQFHVXQGHUWKHPIRUWKH VXOOLDJHZKLFKUHQGHUVWKHPYHU\VZHHWDQGFOHDQHYHQLQWKHPLGVWRI ZLQWHU7RLWEHORQJHWKPRUHWKDQFKXUFKHVDQGPRQDVWHULHVDQG WKHVHWKHEHVWEXLOWDQGDGRUQHGRIDQ\FLW\LQ,WDO\7KH\JUHDWO\DIIHFW WKH6SDQLVKJUDYLW\LQWKHLUKDELWGHOLJKWLQJRRGKRUVHV²WKHVWUHHWV DUHIXOORIJDOODQWVRQKRUVHEDFNLQFRDFKHVDQGVHGDQVIURPKHQFH EURXJKWILUVWLQWR(QJODQGE\6LU6DQGUHV&XQFRPE 7KHZRPHQDUH JHQHUDOO\ZHOOIHDWXUHGEXWH[FHVVLYHO\OLELGLQRXV7KHFRXQWU\SHRSOH >DUH@VRMRYLDODQGDGGLFWHGWRPXVLFWKDWWKHYHU\KXVEDQGPHQDOPRVW XQLYHUVDOO\SOD\RQWKHJXLWDUVLQJLQJDQGFRPSRVLQJVRQJVLQSUDLVHRI WKHLUVZHHWKHDUWVDQGZLOOFRPPRQO\JRWRWKHILHOGZLWKWKHLUILGGOH 7KH\DUHPHUU\ZLWW\DQGJHQLDODOORIZKLFK,PXVWDWWULEXWHWRWKH H[FHOOHQWTXDOLW\RIWKHDLU

1DSOHV· G\QDPLF SHUVRQDOLW\ EHJDQ WR DWWUDFW WUDYHOOHUV ZKR

63$1,6+1$3/(6

DSSUHFLDWHGWKHPDQ\FXOWXUDODPHQLWLHVRQRIIHU7KH)UHQFKDQG WKH6SDQLVKKDGDSDUWLFXODUDIILQLW\IRU1DSOHVEHFDXVHRIWKHLUFORVH SROLWLFDOWLHVWRWKHFLW\0DQ\WUDYHOOHUVDUULYHGIURP(QJODQGDQG *HUPDQ\DVZHOO$VHYHQWHHQWKFHQWXU\*HUPDQJXLGHWRWKHFLW\ UHFRPPHQGHGDQLQQZLWKDOOWKHDPHQLWLHVH[SHFWHGE\*HUPDQ VSHDNLQJWUDYHOOHUV¶$VVRRQDV\RXUHDFKWKHFDSLWDORIWKH.LQJGRP DVN IRU WKH %ODFN (DJOH WKH LQQ ZKHUH \RX ZLOO ILQG D *HUPDQ KRVW 'LHWULFK %UHLWEDFN RI .REOHQ] +HUH \RX ZLOO EH WUHDWHG PDJQLILFHQWO\·$ KLJKOLJKW RI WKH WRXULVW FLUFXLW DOVR LQFOXGHG WKH VROIDWDUDLQQHDUE\3R]]XROL3RPSHR6DUQHOOL·VJXLGHERRNGHVFULEHV ¶WKHFDYHRIWKHGRJ·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·VYDXOW7KH\DSSHDUUHVSOHQGHQWWRWKRVHZKR ORRNLQIURPWKHRXWVLGH8VXDOO\WKHH[SHULPHQWLVFDUULHGRXWXVLQJ GRJV7KHLUKHDGVDUHIRUFHGWRWKHJURXQGDQGZLWKLQDPLQXWHWKH\ DSSHDU GD]HG DQG QHDU GHDWK ,I WKH\ DUH WKHQ WDNHQ LQWR WKH ODNH ZKLFKLVQRPRUHWKDQILIWHHQVWHSVDZD\WKH\UHFRYHUWKHLUORVWVHQVHV +RZHYHULIWKHDQLPDOVWD\VORQJHUZLWKRXWR[\JHQ LWGLHVDQGWKH ZDWHURIWKHZKROHODNHFDQQRWUHYLYHLW

7KHEURWKHURIWKHHOHFWRURI%UDQGHQEXUJDWWHPSWHGWKHH[SHULPHQW RQ WZR GRJV LQ RUGHU WR VDWLVI\ KLV FXULRVLW\ 2QH GLHG DQG WKH RWKHUUHFRYHUHGZKHQGRXVHGZLWKFROGZDWHU,WLVUXPRXUHGWKDW 'RQ3LHWURGL7ROHGRDWWHPSWHGWKHH[SHULPHQWRQWZRFULPLQDOV

,17+(6+$'2:2)9(689,86

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·V VXSSRUWHUV LQWHQVLILHG WKHLU HIIRUWV DQG9LHQQD SURYLGHG SROLWLFDO VXSSRUW 2Q 6HSWHPEHU 1HDSROLWDQ SDWULRWV VWRUPHG WKH 0DVFKLR$QJLRLQR DV WKH SRSXODFH UDPSDJHG DQG VDFNHG WKH FLW\ 8QIRUWXQDWHO\ IRU WKH DULVWRFUDWLFSDWULRWVWKHORFDOSRRUUHPHPEHUHGDOOWRRZHOOWKHLU ODFNRIVXSSRUWDWWKHWLPHRI0DVDQLHOOR·VUHYROWDQGGLGQRWIHHO LQFOLQHGWRJLYHZKROHKHDUWHGDVVLVWDQFH)RUHZDUQHGRIWKHSORW 6SDQLVKIRUFHVFDSWXUHGVHYHUDOVXSSRUWHUVRI0DFFKLDDQG&DUDID ZKRZHUHODWHUSXEOLFO\H[HFXWHG7KRVHZKRFRXOGWRRNUHIXJHDW WKHLPSHULDOFRXUWLQ9LHQQD

63$1,6+1$3/(6

$XVWULDQ3DUHQWKHVLV¦

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·V JRRGLQWHQWLRQV

,17+(6+$'2:2)9(689,86

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·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

63$1,6+1$3/(6

PDVN IRU WKH VWDUN UHDOLWLHV RI VRFLDO SUREOHPV ZKLFK ZHUH QRW VXIILFLHQWO\ DGGUHVVHG$UWLVWLF FLW\VFDSHV FRQILUP WKH SRWHQF\ RI WKH1HDSROLWDQV·IHDUV$QLFRQRJUDSKLFDOWUDQVIRUPDWLRQRFFXUUHG DV9HVXYLXVEHFDPHWKHQHZHPEOHPRIWKHFLW\)URPWKHHLJKWHHQWK FHQWXU\1DSOHVLVQRORQJHUUHSUHVHQWHGLFRQRJUDSKLFDOO\IURPWKH VHDRUIDFLQJQRUWK3DLQWHUVLQVWHDGIRFXVHGRQWKHEDFNGURSRID YROFDQLFODQGVFDSHDQGDVRXWKIDFLQJSHUVSHFWLYHWRZDUGV9HVXYLXV DQG D VN\ EOLQGHG E\ WKH VXQ RQ WKH KRUL]RQ7KH YROFDQR EHJDQ WRGRPLQDWH1HDSROLWDQLFRQRJUDSK\DVDJUDQGV\PERORIQDWXUH XQ\LHOGLQJWRPDQ7KHQHZSURPLQHQFHRI9HVXYLXVZDVWREHFRPH DGHILQLQJIHDWXUHRI%RXUERQ1DSOHV

&+$37(5)285

% 2 8 5 % 2 1 1$3/(6

(WLQDUFDGLDHJR¦

,

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

,17+(6+$'2:2)9(689,86

DQGWKH(JJ&DVWOHWRWKHYROFDQRZKHUHZLVSVRILQIHUQDOVPRNH ULVHPHQDFLQJO\DERYHDQDWXUDOSDUDGLVH )ROORZLQJDVKLIWLQWKHEDODQFHRI(XURSHDQSRZHUZLWKWKH:DU RI3ROLVK6XFFHVVLRQ'RQ&DUORVRI%RXUERQWKHKDOI,WDOLDQVRQRI .LQJ3KLOLS9RI6SDLQDQGKLVVHFRQGZLIH(OL]DEHWK)DUQHVHEHFDPH .LQJRI1DSOHV'HQLHGVXFFHVVLRQWRWKH6SDQLVKWKURQHZKLFKZDV H[SHFWHGWRJRWRKLVROGHUKDOIEURWKHUXSRQWKHLUIDWKHU·VGHDWK WKH\RXQJSULQFHKDGRQO\MXVWFHOHEUDWHGKLVHLJKWHHQWKELUWKGD\ ZKHQZLWKKLVDPELWLRXVPRWKHU·VHQFRXUDJHPHQWKHWUDYHOOHGWR 1DSOHVYLD3DUPDDQG3LDFHQ]DWRWDNHWKHFURZQRIWKH7ZR6LFLOLHV IRUKLVRZQ+LVPRWKHUZURWHKLPZRUGVRIHQFRXUDJHPHQW¶*R WKHUHIRUH DQG FRQTXHU ,WDO\·V PRVW EHDXWLIXO FURZQ DZDLWV \RX·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·V KDSSLHVW WLPH RIIHULQJ D FHUWDLQ GHJUHH RI SROLWLFDO VWDELOLW\ DQG LQGHSHQGHQFHDOEHLWLQFRPSOHWHLPSOHPHQWDWLRQRIWKHFLYLFLGHDOV RIWKH(QOLJKWHQPHQW 7KHQHZNLQJZDVDIIHFWLRQDWHO\NQRZQDVWKH5H1DVRQHIRUKLV XQJDLQO\EHDNQRVHZKLFKGRPLQDWHVDOOKLVSRUWUDLWV.LQJ&KDUOHV ZDVDZHOOORYHGPRQDUFK²GHYRXWNLQGO\\HWUHJDO+HGLVOLNHGWKH

%285%211$3/(6

SRPSRVLW\ RI FRXUW FHUHPRQLDO SUHIHUULQJ WR VSHQG KLV WLPH ZLWK IDPLO\RUKXQWLQJLQRQHRIWKHUR\DOORGJHV+LVZLIH0DULD$PDOLD RI6D[RQ\ZDVKHUVHOIQREHDXW\EXWWKHLUVZDVDUR\DOORYHPDWFK %\ WKH WLPH RI WKHLU PDUULDJH WKH WUHDWLHV FRQFOXGLQJ WKH:DU RI 3ROLVK6XFFHVVLRQKDGFRQVROLGDWHGWKHSRVLWLRQRIWKHLQGHSHQGHQW .LQJGRPRIWKH7ZR6LFLOLHVDOWKRXJK&KDUOHVZDVUHTXLUHGWRJUDQW 3DUPD DQG 3LDFHQ]D KLV )DUQHVH LQKHULWDQFH WR WKH$XVWULDQV$V ZHOODVFRQVROLGDWLQJWKHFDSLWDO·VUROHWKURXJKDQLQWHQVLYHEXLOGLQJ SURJUDPPH&KDUOHVH[SORLWHGWKH1HDSROLWDQPXVLFDOWUDGLWLRQDQG WKHFLW\·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«RUHOVHFODGLQWKHPRVWGLVJXVWLQJUDJV«7KHLUEDVLF GLHWLVDIHZRXQFHVRIXQOHDYHQHGEUHDG«,QZLQWHUEHFDXVHWKHUH LVQRUHJXODUZRUN«WKH\DUHIRUFHGWRHDWSODQWVZLWKRXWHYHQRLORU VDOW«,IVRPXFKSRYHUW\LVIRXQGLQWKHSURYLQFHRI7HUUDGL/DYRURD UHJLRQZKHUHPRWKHUQDWXUHLVDWKHUPRVWERXQWLIXO«ZKDWFDQWKH VLWXDWLRQEHLQWKHRWKHUSURYLQFHVRIWKHNLQJGRP"

)RUWXQDWHO\&KDUOHVZDVDVVLVWHGE\DQDEOHJRYHUQPHQWPLQLVWHU %HUQDUGR 7DQXFFL D EULOOLDQW DQG HQOLJKWHQHG DGPLQLVWUDWRU $ EDVLF FRQVWLWXWLRQ ZDV SURPXOJDWHG ZKLFK VHW RXW WKH UROHV DQG

,17+(6+$'2:2)9(689,86

UHVSRQVLELOLWLHV RI IRXU VHFUHWDULHV RI VWDWH IRU LQWHUQDO DIIDLUV MXVWLFHFRPPHUFHDQGHFFOHVLDVWLFDOPDWWHUV *DHWDQR )LODJLHUL ZDV UHSUHVHQWDWLYH RI LQWHOOHFWXDOV ZKR VXSSRUWHGWKHQHZ%RXUERQJRYHUQPHQWXQGHUWKH7DQXFFLUHJLPH +H VKDUHG KLV IHOORZ FLWL]HQV· JURZLQJ FRQFHUQV IRU SUDFWLFDO UHIRUPHFRQRPLFOHJDODQGUHOLJLRXV)LODQJLHULZURWHH[WHQVLYHO\ RQ HGXFDWLRQ DQG LV NQRZQ WR KDYH FRQGXFWHG D FRUUHVSRQGHQFH ZLWK %HQMDPLQ )UDQNOLQ IROORZLQJ WKH $PHULFDQ 5HYROXWLRQ LQ ZKLFK KH VHULRXVO\ FRQVLGHUHG HPLJUDWLQJ WR WKH 86$ ZKHUH LQDOLHQDEOH ULJKWV KDG EHHQ FRGLILHG LQWR WKH VRFLDO FRQWUDFW LQ D PDQQHU KH PXFK DGPLUHG )LODQJLHUL·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
%285%211$3/(6

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·VQHZUROHDVDUR\DOFDSLWDO 7KHDSSHDUDQFHRIWKHFLW\XQGHUZHQWDPDMRUIDFHOLIWRZLQJWRWKH JHQLXVRIVXFKDUFKLWHFWVDV/XLJL9DQYLWHOOL)HUGLQDQGR)XJDDQG )HUGLQDQGR6DQIHOLFH7KHLUVW\OHZDVUHJDODQGLPSRVLQJEXWQRW ZLWKRXWXQLTXHWRXFKHVRIWKHDWULFDOLW\LQKHULWHGIURP1DSOHV·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¶:H KDYH VHHQILWWRUDLVHLQWKLVFDSLWDODKRVSLFHIRUWKHSRRURIHYHU\VH[ DQGDJHDQGWKHUHLQLQWURGXFHWKHMXVWDQGQHFHVVDU\VNLOOVWKDWZLOO

,17+(6+$'2:2)9(689,86

HQVXUHWKDWWKHZRUNLVSOHDVLQJWRWKHH\HVRI*RGDQGRIEHQHILW WRWKLVFLW\DQGUHDOP·7KHEXLOGLQJZHVHHWRGD\LQ3LD]]D&DUOR,,, GHGLFDWHGWR&KDUOHVRI%RXUERQZKRFRPPLVVLRQHGWKHSURMHFW LVPDVVLYH\HWLWLVRQO\DILIWKRIZKDWZDVRULJLQDOO\SODQQHGDV WKH NLQJGRP·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²WKHSXEOLF JUDQDULHVEXLOWDORQJWKHVHDWRWKHHDVWRI1DSOHV 6HYHUDOODYLVKSURMHFWVIRUUR\DOUHVLGHQFHVZHUHFRPPLVVLRQHG GXULQJ WKH UHLJQ RI .LQJ &KDUOHV LQFOXGLQJ WKH 5R\DO 3DODFHV DW &DSRGLPRQWHRYHUORRNLQJ1DSOHVDQGDORQJWKHFRDVWDW3RUWLFL 7KHDUHDVDURXQG3RUWLFLVRRQEHFDPHDIDVKLRQDEOHORFDWLRQIRUWKH 1HDSROLWDQ DULVWRFUDF\ WR EXLOG KROLGD\ KRPHV DQG WKH VWUHWFK RI WKHED\DGRUQHGZLWKWKHLUHOHJDQWYLOODVZDVNQRZQDVWKH¶*ROGHQ 0LOH· ,Q LWV KH\GD\ WKHUH ZHUH PRUH WKDQ ¶YHVXYLDQ YLOODV· EXLOW EHWZHHQ 3RUWLFL DQG 1DSOHV7KH 5R\DO 3DODFH RI &DVHUWD PRGHOOHGRQ9HUVDLOOHVZDVEXLOWDVKRUWGLVWDQFHQRUWKRI1DSOHV LQ DQ DUHD QRWHG IRU LWV H[FHOOHQW KXQWLQJ UHVHUYHV7KH SDODFH GHVLJQHGWREHFRPHWKHIRFDOSRLQWRIDQHQWLUHQHZFLW\ZDVWKH FURZQLQJ DFKLHYHPHQW RI /XLJL9DQYLWHOOL·V FDUHHU7KH JDUGHQV RI WKH3DODFHRI&DVHUWDDUHEUHDWKWDNLQJZLWKZDWHUIDOOVVWDWXHVDQG

%285%211$3/(6

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·V DSSURYDO LW ZDV GHFLGHGQRWWRGHOD\ZRUN

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

,17+(6+$'2:2)9(689,86

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·VJUHDWHVWPRPHQWRIWULXPSKFDPHZKHQKHSHUIRUPHG ,OPDWULPRQLRVHJUHWR7KH6HFUHW0DUULDJH KLVPRVWIDPRXVRSHUDIRU WKH+DEVEXUJ(PSHURULQ9LHQQDZKRHQMR\HGLWVRPXFKWKDWKH DVNHGWKHPXVLFLDQVWRUHSHDWWKHSHUIRUPDQFH,OPDWULPRQLRVHJUHWR LVW\SLFDORIWKHHPHUJHQWJHQUHRIRSHUDEXIIDRUFRPLFRSHUDRIWHQ ZULWWHQ LQ 1HDSROLWDQ GLDOHFW ZKLFK SUHVHQWHG D VHULHV RI VWRFN FKDUDFWHUVVLPLODULQSHUVRQDOLW\WRWKRVHRIWKHFRPPHGLDGHOO·DUWH 6LFLOLDQERUQ $OHVVDQGUR 6FDUODWWL ZDV RQH RI PDQ\ WDOHQWHG PXVLFLDQVDWWUDFWHGE\1DSOHV·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

%285%211$3/(6

PDQ\FRPSRVHUVWKH\RIWHQVLJQHGWKHLUZRUNVZLWKWKHGLVWLQFWLYH FKURPDWLF¶1HDSROLWDQ 6L[WK·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·V UHDO QDPH7UDSDVVL ZDV FKDQJHG WR WKH PRUH *UHFLDQ 0HWDVWDVLR DV *UDYLQD PRXOGHG WKH \RXQJ ER\ LQWR DQ HOHYDWHGLGHDORIWKHFODVVLFDOZULWHUSURGXFLQJWUDJHGLHVLQVSLUHG E\WKHJUHDWHVWZRUNVRIDQFLHQW*UHHNWKHDWUH0HWDVWDVLRZDVD ZLOOLQJVWXGHQWDQGWKHH[SUHVVLYHFODULW\RIKLVZRUNGHPRQVWUDWHV WKDW *UDYLQD·V IDLWK LQ WKH \RXQJ ER\ ZDV QRW PLVSODFHG 8SRQ WKHGHDWKRIKLVPHQWRU0HWDVWDVLRLQKHULWHGDVPDOOIRUWXQHDQG PRYHG WR 1DSOHV ZKHUH KH ZDV DWWUDFWHG E\ WKH FXOWXUDO VFHQH ZKLFKKLVQHZILQDQFLDOSRVLWLRQDOORZHGKLPWRHQMR\WRWKHIXOO 0HWDVWDVLRZDVLQWURGXFHGLQWRWKHDWULFDODQGPXVLFDOFLUFOHVE\WKH VRSUDQR 0DULDQQD %XOJDUHOOL DQG GLVFRYHUHG WKDW KLV WUXH OLWHUDU\ YRFDWLRQZDVQRWWUDJHG\EXWPHORGUDPD0HWDVWDVLR·VILUVWRSHUDWLF PHORGUDPD'LGRQHDEEDQGRQDWD'LGR$EDQGRQHG ZDVVHWWRPXVLF E\ 'RPHQLFR 6DUUR DQG KDLOHG DV D WULXPSK WKURXJKRXW (XURSH 0HWDVWDVLR·V LQWHUSUHWDWLRQ RI FODVVLFDO VW\OLVWLFV DQG UDWLRQDOLVW LGHDOVHYRFDWLYHO\H[SUHVVHGWKHLQWHOOHFWXDOFXUUHQWVRIKLVDJHDQG RIIHUHGDQHZSDUDGLJPIRU1HDSROLWDQRSHUD+HUDWLRQDOLVHGDQG

,17+(6+$'2:2)9(689,86

VLPSOLILHGEDURTXHRSHUDDQGSURYLGHGDQHZWKHRUHWLFDOIUDPHZRUN IRUVHULRXVRSHUDRURSHUDVHULD0HWDVWDVLRVRRQEHFDPHWKHPRVW HPLQHQWOLEUHWWLVWRIKLVGD\+LVWH[WVZHUHXQLYHUVDOO\DFFHSWHGDV SHUIHFWDQGWKHDXGLHQFHRIWHQNQHZHYHU\ZRUGLQDGYDQFHDOPRVW DV ZHOO DV WKH\ NQHZ WKH SUD\HUV RI WKH PDVV +LV OLEUHWWRV ZHUH VHWWRPXVLFE\VRPHRIWKHJUHDWHVWFRPSRVHUVRIWKHGD\*OXFN +DQGHO+D\GQDQG0R]DUWWRQDPHDIHZ6XFKZDV0HWDVWDVLR·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²DQGWKHDUFKULYDORI+DQGHODQGKLVFLUFOH $W WKH KHLJKW RI KLV FDUHHU WKH VLQJHU ZDV DSSRLQWHG GLUHFWRU RI PXVLFDWWKHFRXUWRI.LQJ3KLOLS9RI6SDLQIDWKHURI.LQJ&KDUOHV

%285%211$3/(6

RI1DSOHV ZKREHJJHG)DULQHOOLWRVLQJKLPWKHVDPHIRXUVRQJV HYHU\QLJKW:KHQVHQLRUFRXUWLHUVUHFRJQLVHGWKHVRRWKLQJSRZHUV RIWKHFDVWUDWR·VPXVLFDOWDOHQWDVDQDQWLGRWHWRWKHNLQJ·VLQFLSLHQW PDGQHVV)DULQHOOL·VSUHVWLJHLQFUHDVHG )DULQHOOLZDVDIDPLOLDUIL[WXUHDWRSHUDWLFSHUIRUPDQFHVLQ1DSOHV WKURXJKRXWKLVFDUHHU7KH6DQ&DUOR2SHUD+RXVHZKLFKDGMRLQV WKH 5R\DO 3DODFH ZDV RSHQHG RQ WKH IHDVW RI 6DLQW &KDUOHV WKH NLQJ·V QDPHVDNH RQ 1RYHPEHU \HDUV EHIRUH /D 6FDOD LQ0LODQDQG\HDUVEHIRUH/D)HQLFHLQ9HQLFH 7KHILUVWZRUN WREHSHUIRUPHGZDV$FKLOOHLQ6FLURZLWKDOLEUHWWRE\QRQHRWKHU WKDQ 0HWDVWDVLR WR PXVLF E\ 'RPHQLFR 6DUUR ZKR FRQGXFWHG WKH LQDXJXUDO SHUIRUPDQFH7KH WKHDWUH·V RUQDWH DUFKLWHFWXUH ZDV PDWFKHG E\ PDJQLILFHQW SURGXFWLRQV ZLWK VXPSWXRXV PXVLF FRVWXPHVDQGVHWWLQJVDOWKRXJKE\DOODFFRXQWV.LQJ&KDUOHVZRXOG FKDWDQGVQRR]HWKURXJKPRVWSHUIRUPDQFHV1HDSROLWDQRSHUDZDV VRRQDOOWKHUDJHWKURXJKRXW(XURSH$UWLVWVIURP1DSOHVFDSLWDOLVHG RQWKLVLQWHUQDWLRQDOLQWHUHVWDVWKHFLW\·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

,17+(6+$'2:2)9(689,86

*L]]LHOOR ZKRKDGERWKVWXGLHGDWWKH1DSOHVFRQVHUYDWRU\ $OWKRXJKWKH6DQ&DUOR2SHUD+RXVHZDVWKHHSLFHQWUHRIWKH FLW\·VPXVLFDOWUDGLWLRQLQWKHFLW\·VRWKHUWKHDWUHVWKHQHZJHQUHRI RSHUDEXIIDZULWWHQLQ1HDSROLWDQGLDOHFWZDVLQFUHDVLQJO\SRSXODU 2QH RI WKH PRVW IDPRXV VXFK ZRUNV ZDV WKH FKDUPLQJ /D VHUYD SDGURQDE\3HUJROHVL,WZDVDKXJHVXFFHVVZKHQILUVWSHUIRUPHG LQ 3DULV SURYRNLQJ D PDVVLYH FRQWURYHUV\ DPRQJ 3DULVLDQV RYHU WKH UHVSHFWLYH PHULWV RI ,WDOLDQ DQG )UHQFK RSHUD NQRZQ DV WKH *XHUUHGHV%RXIIRQV:DURIWKH%XIIRRQV 7KRVHZKRVXSSRUWHGWKH RSHUDEXIIDZHUHNQRZQDV¶EXIIRRQLVWV·DQGWKHLURSSRQHQWVZHUH ¶DQWLEXIIRRQLVWV· ,Q WKH HQG RSHUD EXIID·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·V KRQRXU HYHU\ \HDU LQ +RO\:HHN DW WKH &KXUFK RI 6DQ )HUGLQDQGR IRU ZKLFK LW ZDV RULJLQDOO\FRPSRVHGVWDQGLQJRSSRVLWHWKH5R\DO3DODFHLQ3LD]]D 7ULHVWHH7UHQWR3HUJROHVL·VGHDWKDWDJHDPLGUXPRXUVWKDWKH KDGEHHQSRLVRQHGE\DORYHULYDOUHVXOWHGLQKLVSRVWKXPRXVIDPH DVDWUDJLFLOOVWDUUHGJHQLXV 1DSOHV ZDV DOVR UHQRZQHG IRU WKH ILQH FHOORV SURGXFHG LQ WKH ZRUNVKRS RI WKH PDVWHU FUDIWVPDQ$OHVVDQGUR *DOOLDQR ZKR KDG WUDLQHG DV DQ DSSUHQWLFH ZLWK YLROLQPDNHU$QWRQLR 6WUDGLYDUL LQ &UHPRQD7KHWRQDOTXDOLW\RI*DOOLDQR·VLQVWUXPHQWVLVPHOORZRQ WKHORZHUVWULQJV\HWOLJKWDQGVLOYHU\RQWKHWRSVWULQJV$XWKHQWLF

%285%211$3/(6

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
+DYLQJ VSHQW WLPH LQ 1DSOHV LQ KLV \RXWK 0R]DUW UHPHPEHUHG HQRXJKRIWKHORFDODWPRVSKHUHWRXVHLWDVDVW\OLVHGVHWWLQJIRU KLV &RVu IDQ WXWWH D WDOH RI FUDIW\ DQG XQIDLWKIXO ORYHUV %RXUERQ 1DSOHVZDVDJODPRURXVFLW\RIZRUOGO\SOHDVXUHVDQGWKHPXVLFDO WUDGLWLRQ UHIOHFWV WKLV VKLIW LQ DWWLWXGHV D GUDPDWLF FKDQJH LQ GLUHFWLRQ IURP WKH VDFUHG ZRUNV RI WKH EDURTXH WR WKH SURIDQH SDVVLRQVRIRSHUD 7KH RWKHU JUHDW FXOWXUDO SKHQRPHQRQ RI %RXUERQ 1DSOHV ZDV WKHGLVFRYHU\RIWKHORVW5RPDQFLWLHV+HUFXODQHXPDQG3RPSHLL XQGRXEWHGO\WKHPRVWVLJQLILFDQWHYHQWRI&KDUOHV·UHLJQ7KHFLWLHV KDGOLWHUDOO\GLVDSSHDUHGIROORZLQJWKHJUHDWHUXSWLRQRI9HVXYLXV LQ$'$OPRVWFHQWXULHVODWHUZKLOHGLJJLQJDZHOOVRPHWLPH DURXQG WKH DUFKLWHFW 'RPHQLFR )RQWDQD GLVFRYHUHG VRPH EXULHG UXLQV ZLWKRXW KRZHYHU UHDOLVLQJ WKDW DQ HQWLUH FLW\ OD\ EHORZ JURXQG +LV ZRUNHUV UHDOLVHG WKDW WKH\ KDG GLVFRYHUHG DQ DQFLHQW WKHDWUH ZKHUH DQ LQVFULSWLRQ ZDV IRXQG FRQWDLQLQJ WKH QDPH RI +HUFXODQHXP$Q DUFKDHRORJLFDO GLJ ZDV RUGHUHG .LQJ &KDUOHV XQGHUVWRRG KRZ PXFK 1DSOHV ZDV WR JDLQ LQ SUHVWLJH

,17+(6+$'2:2)9(689,86

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«
%285%211$3/(6

PDNHRXWYHU\SODLQO\DQDPSKLWKHDWUHWKHVWDLUVRIZKLWHPDUEOHDQG WKH VHDWV DUH YHU\ SHUIHFW «7KH\ KDYH IRXQG DPRQJ RWKHU WKLQJV VRPHILQHVWDWXHVVRPHKXPDQERQHVULFHPHGDOVDQGDIHZSDLQWLQJV H[WUHPHO\ILQH«7KHUHLVQRWKLQJRIWKHNLQGNQRZQLQWKHZRUOG, PHDQD5RPDQFLW\HQWLUHRIWKDWDJHDQGWKDWKDVQRWEHHQFRUUXSWHG ZLWK PRGHUQ UHSDLUV « ·7LV FHUWDLQO\ DQ DGYDQWDJH WR WKH OHDUQHG ZRUOG WKDW WKLV KDV EHHQ ODLG XS VR ORQJ 0RVW RI WKH GLVFRYHULHV LQ 5RPHZHUHPDGHLQDEDUEDURXVDJHZKHUHWKH\RQO\UDQVDFNHGWKH UXLQVLQTXHVWRIWUHDVXUH

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«WKHLQVLGH RI WKH ZKROH VXEWHUUDQHRXV FLW\ RI +HUFXODQHXP7KH\ DUH DSW WR LPSHDFKWKHWDVWHRIWKHFRXUWDQGRIWKRVHZKRGLUHFWWKHVHZRUNV« 7KRVHZKRKDYHDPLQGWRVHHWKHZDOOVRIDQFLHQWEXLOGLQJVIRUPHUO\ EXULHGLQWKHVDPHPDQQHUPD\VDWLVI\WKHLUFXULRVLW\DW3RPSHLL%XW IHZSHUVRQVH[FHSW(QJOLVKPHQKDYHUHVROXWLRQHQRXJKWRJRVRIDU RQWKDWDFFRXQW$W3RPSHLLWKHJURXQGPD\EHZLWKRXWDQ\ULVNDQG DWDVPDOOH[SHQVHWKHODQGO\LQJRYHULWEHLQJRIOLWWOHYDOXH

7KH )UHQFK ZULWHU HQJUDYHU DQG DUFKDHRORJLVW WKH &RXQW GH &D\OXVZDVDOVRIDVFLQDWHGE\3RPSHLLDQG+HUFXODQHXPDQGOLNH :LQNHOPDQQ KH UHVHQWHG WKH VHFUHF\ ZLWK ZKLFK WKH 1HDSROLWDQ FRXUWVXUURXQGHGWKHVLWH+HWUDQVODWHG:LQNHOPDQQ·VSDPSKOHWV

,17+(6+$'2:2)9(689,86

7KH3UDJPDWLF6DQFWLRQ&KDUOHVRI%RXUERQPDGHDVROHPQ GHFUHHJRYHUQLQJWKHVXFFHVVLRQWRWKHWKURQHVRI1DSOHV 6LFLO\DQG6SDLQIRUELGGLQJWKHXQLRQRI1DSOHVDQGWKH7ZR 6LFLOLH VWRWKH6SDQLVK(PSLUH2FWREHU

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·V HOGHVWER\ZDVPHQWDOO\LPSDLUHGDQGWKHLUVHFRQGVRQZDVFKRVHQ WRFDUU\RQWKH6SDQLVK%RXUERQOLQHRIVXFFHVVLRQIURPZKLFKWKH SUHVHQW.LQJRI6SDLQDQGKLVIDPLO\GHVFHQG7KXVLWZDVGHFLGHG WKDW\RXQJ3ULQFH)HUGLQDQGZRXOGEHFRPHWKHQH[WNLQJRI1DSOHV

%285%211$3/(6

&KDUOHVOHIWKLVHLJKW\HDUROGKHLULQWKHFDUHRIWKH3ULPH0LQLVWHU %HUQDUGR7DQXFFL 8SRQKLVGHSDUWXUHIURP1DSOHVWKHNLQJGHFODUHGWKDWKHQFHIRUWK DQ\SULQFHHQWLWOHGWRDSODFHLQWKH6SDQLVKVXFFHVVLRQFRXOGQRW VLPXOWDQHRXVO\OD\FODLPWRWKH&URZQRIWKH7ZR6LFLOLHVRUDSODFH LQWKHVXFFHVVLRQWRWKDW&URZQ7KLVODZVHUYHGWRIRUHYHUVHSDUDWH WKH%RXUERQG\QDVW\RIWKH7ZR6LFLOLHVIURPWKDWRI6SDLQ$IWHU KDQGLQJRYHUDOORIWKHFURZQMHZHOVWKHNLQJUHPRYHGDQDQWLTXH ULQJZKLFKKHKDGZRUQVLQFHLWVGLVFRYHU\GXULQJDYLVLWWR3RPSHLL ¶7KLV WRR EHORQJV WR WKH 6WDWH· KH SURQRXQFHG VROHPQO\ DV KH SODFHGWKHSUHFLRXVULQJRQ)HUGLQDQG·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

,17+(6+$'2:2)9(689,86

+HVSRNHRQO\WKH1HDSROLWDQGLDOHFWRISDODFHVHUYDQWVDQGFRXQWU\ SHDVDQWV EXW ZDV DQ DIIDEOH FKDUPLQJ PDQ JUHDWO\ ORYHG E\ WKH FRPPRQ SHRSOH ZKR DIIHFWLRQDWHO\ FDOOHG KLP WKH 5H /D]]DURQH IRU KLV DIILQLW\ ZLWK WKH FLW\·V XUEDQ SRRU7KH %ULWLVK HQYR\ 6LU :LOOLDP+DPLOWRQGHVFULEHGWKHNLQJLQGLVSDWFKHVWRKLVVXSHULRUV LQ/RQGRQ +LV6LFLOLDQ0DMHVW\LVRIDFRQVWLWXWLRQH[WUHPHO\GHOLFDWHZKLFKZLWK KLVEURWKHU·VPRVWSUREDEO\KHLQKHULWHGIURPWKHJUHDWJUDQGIDWKHU RIKLVPRWKHU8QKDSSLO\IRUKLPVHOIDQGKLVSHRSOHKHKDVQHLWKHU KDGPDVWHUVFDSDEOHRILQVWUXFWLRQQRUJRYHUQRUVZKRKDYHVWXGLHGWR LQVSLUHKLPZLWKLGHDOVZRUWK\RIKLVUDQN+HLVEHORYHGE\WKHYXOJDU 1HDSROLWDQVPHUHO\IURPKLVKDYLQJEHHQERUQDPRQJVWWKHPDQGLI KHORYHVWKHPDVKHVHHPVWRGRLWLVSHUKDSVEHFDXVHE\WKHGLVWDQFH WKH\KDYHDOZD\VFDUHIXOO\SODFHGEHWZHHQKLPDQGWKHQRELOLW\RIKLV RZQ DJH KH KDV EHHQ GULYHQ UDWKHU WR VHHN WKH FRPSDQ\ RI PHQLDO VHUYDQWV DQG SHRSOH RI WKH YHU\ ORZHVW FODVV WKDQ WKRVH RI D EHWWHU HGXFDWLRQDQGLQGHHGLWLVLQWKHFRPSDQ\RIWKHIRUPHUWKDWKHLV EHVWSOHDVHGZKLOVWKHWUHDWVWKHODWWHUDVLIWKHUHZDVQRGLIIHUHQFH EHWZHHQWKHRQHDQGWKHRWKHU

7KHNLQJZRXOGVHWXSDVPDOOVWDQGLQWKHPDUNHWHDFKHYHQLQJ DVKHUHWXUQHGIURPKXQWLQJLQRUGHUWRVHOOKLVFDWFKDQGLQGHHG KHRIWHQJDYHPXFKRILWDZD\WRWKHSRRUHVWFLWL]HQV7KHNLQJ·V SHUVRQDOKDELWVZHUHPRUHWKRVHRIDQRYHULQGXOJHGFKLOGWKDQD VRSKLVWLFDWHGPRQDUFK+HORYHGQRWKLQJPRUHWKDQWRPHUFLOHVVO\ WLFNOH SDODFH VHUYDQWV ZKR ZHUH IRUELGGHQ WR IOLQFK IURP KLV PLVFKLHYRXVILQJHUV:KHQWKH5H/D]]DURQHPDUULHG0DULD&DUROLQD RI+DEVEXUJWKHHOHJDQWFXOWXUHGDQGSROLWLFDOO\DVWXWHGDXJKWHU RIWKH(PSUHVV0DULD7KHUHVDLWZDVVRPHWKLQJRIDPLVPDWFK7KH NLQJZDVIRQGRIKLVZLIHDOWKRXJKKHRIWHQZDVKHDUGWRFRPSODLQ RI KHU ORYH RI ERRNV « D KDELW KH GHSORUHG 0DULD &DUROLQD·V EURWKHU(PSHURU-RVHSK,RI$XVWULDGHVFULEHGKHUKXVEDQGWKXV

%285%211$3/(6

¶$OWKRXJKDQXJO\3ULQFHKHLVQRWDEVROXWHO\UHSXOVLYHKLVVNLQLV IDLUO\VPRRWKDQGILUPRID\HOORZLVKSDOORUKHLVFOHDQH[FHSWIRU KLVKDQGVDQGDWOHDVWKHGRHVQRWVWLQN·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

0DULD&DUROLQDZDVYHU\PXFKKHUPRWKHU·VGDXJKWHUDQG0DULD 7KHUHVDKDGFUDIWLO\LQVHUWHGLQWKHPDUULDJHFRQWUDFWDFODXVHZKLFK VWLSXODWHGWKDW0DULD&DUROLQDEHDOORZHGWRSDUWLFLSDWHDFWLYHO\LQ JRYHUQPHQWXSRQWKHELUWKRIKHUILUVWVRQ$IWHUILYHGDXJKWHUVWKH TXHHQDWODVWJDYHELUWKWRDQKHLUDQGGXO\WRRNKHUSODFHRQWKH &RXQFLORI6WDWH$VWKHTXHHQ·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¶1XQ]LDWHOOD·EHFDXVHRILWVORFDWLRQQH[WWR WKHFKXUFKRIWKHVDPHQDPHRQ3L]]RIDOFRQHKLOO

,17+(6+$'2:2)9(689,86

,QSDUWEHFDXVHRIKLVZLIH·VLQWULJXHV)HUGLQDQG·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ÀD GHO *LXRFR GHO/RWWRE\*LXOHR5XPHL$VHULHVRIQXPEHUVIURPWRDUH FKRVHQ EDVHG RQ WKH DVVRFLDWLRQ RI HDFK QXPEHU ZLWK D VSHFLILF LPDJHWKHUHE\DOORZLQJGUHDPVWREHLQWHUSUHWHGDVQXPEHUVDQG SOD\HGXSRQDZDNHQLQJ'D\WRGD\HYHQWVFRXOGDOVREHLQWHUSUHWHG QXPHULFDOO\LQWKHVDPHZD\VHH$SSHQGL[,, 7KH IHXGDO V\VWHP FRQWLQXHG DV WKH HFRQRPLF EDVH RI WKH NLQJGRP %RXUERQ 1DSOHV GHULYHG PRVW RI LWV ZHDOWK IURP WKH

%285%211$3/(6

DJULFXOWXUDOSURILWVRILWVYDVWWHUULWRU\1HDSROLWDQDULVWRFUDWVOLYHG RIIWKHLQFRPHIURPWKHLUHVWDWHVLQWKHULFKDJULFXOWXUDOUHJLRQVRI &DPSDQLD$SXOLDDQG&DODEULD7KHVRFDOOHGQRELOLWjJHQHURVDZHUH ROGIDPLOLHVZKRVHRULJLQVGDWHGEDFNWRWKH$UDJRQHVHWKH$QJHYLQV DQGWKH1RUPDQVZKHUHDVWKHQRELOLWj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·DVFHQVLRQ WKH\UHFHLYHGPRUHWKDQRQHWKLUGRIWKHNLQJGRP·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

,17+(6+$'2:2)9(689,86

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

%285%211$3/(6

DQGLQWHUPL[HGZLWKORDYHVRIEUHDGVRZHOOSODFHGDVWRGHFHLYHWKH H\H2QWKHVLGHVRIWKHKLOOZKLFKLVFRYHUHGZLWKJUHHQERXJKV DSSHDU OLYLQJ ODPEV RUQDPHQWHG ZLWK ULEDQGV DQG DUWLILFLDO IORZHUV LQDQRWKHUSDUWDUHFDOYHVDQGVRPHR[HQDPRQJVWWKHERXJKVJHHVH DQGSLJHRQVDUHQDLOHGIDVWE\WKHZLQJV2QWKHWRSVWDQGVDILJXUHRI $SROORSOD\LQJRQWKHO\UH)RUPHUO\DOOWKHFUHDWXUHVZHUHSODFHGKHUH DOLYHDQGWLHGIDVWWRWKHZRRGZRUNEXWQRZE\WKLVDPLDEOH4XHHQ·V SDUWLFXODUFRPPDQGWKHR[HQDUHNLOOHGEHIRUHWKHVSRUWEHJLQV7KH JXDUGV DUH GUDZQ RXW URXQG WKLV DUWLILFLDO KLOO WR SUHYHQW PLVFKLHI DQGDWDVLJQDOJLYHQWKHPREIDOORQGHVWUR\WKHEXLOGLQJFDUU\RII ZKDWHYHUWKH\FDQOD\KROGRIDQGILJKWZLWKHDFKRWKHUWLOOJHQHUDOO\ VRPHIDWDODFFLGHQWHQVXHV7KHFRXUWDUHIUHTXHQWO\LQWKHEDOFRQLHVRI WKHSDODFHZLWKPRVWRIWKHQRELOLW\RI1DSOHVWRVHHWKH&XFFDJQD

7KHHODERUDWHGLVSOD\VRIRJQLEHQGLGGLR²DOORI*RG·VERXQW\²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·V IRUHKHDG DQG WKHZRXQGVRIWKH3DVVLRQDUHHWFKHGRQKLVKDQGVDQGIHHW6XFK LVWKHGHOLFDF\DQGLQWULFDWHQDWXUHRILWVH[HFXWLRQWKDWWKHJUHDW VFXOSWRU$QWRQR&DQRYDLVNQRZQWRKDYHVDLGWKDWKHZRXOGJODGO\ KDYHJLYHQWHQ\HDUVRIKLVOLIHWRKDYHFDUYHGLWKLPVHOIDQGPDQ\ YLVLWRUVWRWKHFLW\FODLPWKDWWKHVWDWXHDORQHLVZRUWKWKHMRXUQH\WR 1DSOHV7KH6DQ6HYHUR&KDSHOLVDSULYDWHIXQHUDOYDXOWEHORQJLQJ

,17+(6+$'2:2)9(689,86

WR WKH IDPLO\ RI SULQFH DQG DOFKHPLVW 5DLPRQGR GL 6DQJUR ZKR ZDV UHQRZQHG IRU KLV JUHDW OHDUQLQJ DQG DGYDQFHG HQJLQHHULQJ SURMHFWVVXFKDVDVLQJOHEDUUHOOHGVKRWJXQDQDPSKLELRXVFDUULDJH ZKLFK ZDV D IRUHUXQQHU WR PRGHUQ VXEPDULQHV DQ HWHUQDO ODPS DQGDSRO\FKURPDWLFSULQWLQJSUHVV7KHSULQFHDOVRPDGHGLVWXUELQJ DQDWRPLFDO H[SHULPHQWV LQ RUGHU WR SURGXFH WKH HHULO\ OLIHOLNH DQDWRPLFDOPRGHOVUXPRXUHGWRKDYHEHHQPDGHIURPWKHHPEDOPHG FRUSVHVRIWUXVWHGIDPLO\VHUYDQWV([FRPPXQLFDWHGIRUKLVDFWLYLW\ DVD*UDQG0DVWHURIWKH0DVRQLF7HPSOHRI1DSOHVGL6DQJURVSHQW KLVILQDO\HDUVLQKHUPLWOLNHVHFOXVLRQSODQQLQJDQGGHFRUDWLQJWKH HODERUDWHIDPLO\FKDSHO 7KH&DWKROLFIDLWKZDVDQHVVHQWLDOHOHPHQWLQWKHGDLO\OLYHVRI WKH 1HDSROLWDQV )URP WKH ODWWHU SDUW RI WKH HLJKWHHQWK FHQWXU\ PDQ\FLW\VWUHHWVDQGSDODFHFRXUW\DUGVZHUHLOOXPLQDWHGE\YRWLYH VKULQHVVRPHFRQWDLQLQJPDGRQQDVDQGRWKHUVFRQWDLQLQJSRUWUDLWV DQG VWDWXHV RI ORFDOO\ YHQHUDWHG VDLQWV DQG LPDJHV RI WKH VRXOV LQ SXUJDWRU\7KH VKULQHV DUH WKRXJKW WR KDYH DQFLHQW RULJLQV LQ WKH IDPLO\DOWDUVRI5RPDQKRPHV$ORFDOFXVWRGLDQZRXOGEHFKDUJHG ZLWK WKH UHVSRQVLELOLW\ RI HQVXULQJ LOOXPLQDWLRQ PDLQWHQDQFH FOHDQLQJDQGIORZHUVEXWSDVVHUVE\DQGQHLJKERXUVZRXOGPDNH FRQWULEXWLRQVRQIHDVWGD\VRUIRUSHUVRQDOLQWHUFHVVLRQV7KHVDFUHG LPDJHEHFDPHWKHSURWHFWRURIWKHORFDOFRPPXQLW\6RPHVKULQHV EHFDPHPLQLFHQWUHVRISLOJULPDJHDQGGHYRWLRQLQSDUWLFXODUWKRVH GHGLFDWHGWR6DLQW&LURIRUKHDOWKSUREOHPVDQGH[SHFWDQWPRWKHUV ZRXOGYLVLWVKULQHVGHGLFDWHGWR6DLQW$QQHWRSUD\IRUDVXFFHVVIXO SUHJQDQF\DQGELUWK 1RWZLWKVWDQGLQJWKHQXPHURXV1HDSROLWDQGLVSOD\VRIGHYRWLRQ DQG SRSXODU SLHW\ LQFUHDVLQJ HIIRUWV ZHUH PDGH IRU HFFOHVLDVWLFDO RUJDQLVDWLRQV WR ZRUN FRQVWUXFWLYHO\ LQ UHVSRQVH WR VRFLDO LVVXHV 0DQ\ ILQH LQVWLWXWLRQV ZHUH HVWDEOLVKHG LQ 1DSOHV IRU UHOLJLRXV HGXFDWLRQ2QHRIWKHRXWVWDQGLQJ&DWKROLFHGXFDWRUVRIWKHSHULRG

%285%211$3/(6

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¶VWULYHWRLPLWDWH WKHYLUWXHVDQGH[DPSOHVRI-HVXV&KULVW2XU5HGHHPHUFRQVHFUDWLQJ WKHPVHOYHVHVSHFLDOO\WRWKHSUHDFKLQJRIWKHZRUGRI*RGWRWKH SRRU·7KHRUGHUHYHQWXDOO\IRXQGLWVVSHFLILFYRFDWLRQLQSURYLGLQJ VHUYLFHVIRUWKH\RXQJHVSHFLDOO\VFKRROV7KHRUGHUVRRQWRRNRQDQ LQWHUQDWLRQDOFKDUDFWHUGXHWRWKHVXFFHVVRILWVVFKRROVWKURXJKRXW ,WDO\DQG(XURSH7KH$PHULFDQSURYLQFHRIWKHFRQJUHJDWLRQKDV D VXEVWDQWLDO SUHVHQFH LQ WKH HDVWHUQ 86$ DQG &DQDGD HVSHFLDOO\ 4XHEHF3RSH-RKQ3DXO,,KDVSUDLVHG6W$OSKRQVXVDV¶DJLJDQWLF ILJXUHQRWRQO\LQWKHKLVWRU\RIWKH&KXUFKEXWIRUWKHZKROHRI KXPDQLW\DVZHOO«WKH´WHDFKHURIWKH&DWKROLFVRXORIWKH:HVWµ GLGIRUPRGHUQ&DWKROLFLVPWKDWZKLFK$XJXVWLQHDFFRPSOLVKHGLQ

,17+(6+$'2:2)9(689,86

DQFLHQWWLPHV·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·V RXWVWDQGLQJ LQWHOOHFWXDOV 3LHWUR *LDQQRQH DQG *LDPEDWWLVWD9LFRZKRZHUHERWKERUQLQWRPLGGOHFODVVIDPLOLHV UHDGODZDWWKH8QLYHUVLW\RI1DSOHV$FDUHHULQODZEHFDPHWKH HVWDEOLVKHG PHWKRG IRU D \RXQJ PDQ ZLWKRXW H[WHQVLYH ILQDQFLDO UHVRXUFHV WR PDNH D JRRG OLYLQJ DQG DVFHQG WKH VRFLDO VFDOH7KH NLQJGRPZDVGLYLGHGLQWRQXPHURXVMXULVGLFWLRQVZLWKWKHLURZQ FRXUWV DQG WKHUH ZDV D JURZLQJ QHWZRUN RI HFFOHVLDVWLFDO FRXUWV

%285%211$3/(6

LQGHSHQGHQW RI WKH WHPSRUDO JRYHUQPHQW ZKLFK RSHUDWHG XQGHU WKHDGPLQLVWUDWLRQRIWKHSDSDODXWKRULWLHVLQ5RPH%HFDXVHRILWV FRPSOLFDWHGSROLWLFDOKLVWRU\WKHOHJDOFRGHVRIWKH.LQJGRPRIWKH 7ZR6LFLOLHVZHUHPDGHXSRIQXPHURXVDQGRIWHQFRQWUDGLFWRU\ FRPSLODWLRQVIURPWKH/RPEDUGVWKH1RUPDQVWKH+RKHQVWDXIHQV WKH$QJHYLQVDQGWKH$UDJRQHVHDVZHOODVFDQRQODZDQGORFDOVWDWXWHV DQGOHJLVODWLRQ7KHOHJDOV\VWHPVRIVRPDQ\SUHYLRXVUHJLPHVHDFK VXSHULPSRVHGXSRQWKHQH[WZDVVRFRQYROXWHGWKDWVRRQHYHU\RQH LQ 1DSOHV ZDV VXLQJ HYHU\RQH HOVH /DZVXLWV SUROLIHUDWHG DQG WKH IRUHQVLFSURIHVVLRQJUHZLQVL]HH[SRQHQWLDOO\&RQIXVLRQEHWZHHQ FRQIOLFWLQJODZVDQGMXULVGLFWLRQVSURYLGHGSOHQW\RIZRUNIRUDOOWKH OHJDO SURIHVVLRQDOV LQ WKH FDSLWDO7KH DVVRFLDWHG EXUHDXFUDF\ ZDV FRQYROXWHGDQGFRPSOLFDWHGVZDPSLQJWKHODZFRXUWVDQGOLQLQJ WKHSRFNHWVRIDOOWKHODZ\HUV 7KH QHZ PLGGOH FODVVHV OLYHG LQ DQ XQHDV\ UHODWLRQVKLS ZLWK WKH DULVWRFUDF\ DQG WKH HFFOHVLDVWLFDO DXWKRULWLHV *HRJUDSKLFDOO\ SRVLWLRQHG VR QHDU WR 5RPH 1DSOHV ZDV VWLOO KHDYLO\ LQIOXHQFHG E\WKHSDSDF\\HWUHVLVWHGLWVLQWHUIHUHQFH3RSXODURSSRVLWLRQWR WKHH[FHVVHVRIWKH,QTXLVLWLRQZDVDFFRPSDQLHGE\DQLQFUHDVLQJ LQWHUHVWLQVFLHQFHDQGUDWLRQDOLVPZKLFKZHUHDQLPSRUWDQWSDUW RI WKH SURFHVV RI FXOWXUDO UHQHZDO HPSKDVLVLQJ WKH DXWKRULW\ RI OD\IRUFHVRYHUWKHFOHUJ\DQGOLPLWLQJGHSHQGHQFHRQWKHSDSDF\ 7KHFRQFRUGDWIRUWKHILVFDOLPPXQLW\RIHFFOHVLDVWLFDOSRVVHVVLRQV ZDV UHYRNHG DQG HYHQWXDOO\ WKH -HVXLWV ZHUH H[SHOOHG IURP WKH NLQJGRP ZLWK RQO\ D IHZ KRXUV· QRWLFH WR OHDYH IRU WKH 3DSDO 6WDWHV$OOWKHLUDVVHWVZHUHFRQILVFDWHGE\WKHJRYHUQPHQW$VWKH %RXUERQVVRXJKWWROLPLWHFFOHVLDVWLFDOSULYLOHJHVWKHLQWHOOHFWXDOV SURFODLPHGWKHOLEHUW\RIMXVWLFHUHDIILUPLQJWKHULJKWVRIWKHOD\ DXWKRULWLHV DQG FRQVHTXHQWO\ WKH VRYHUHLJQW\ RI WKH .LQJGRP RI WKH7ZR6LFLOLHV$QWLFOHULFDOLVPZDVRQHRIWKHGRPLQDQWPRWLIVRI WKH%RXUERQSHULRGDQGFRPELQHGZLWKDJUHDWHUGHVLUHIRUORFDO

,17+(6+$'2:2)9(689,86

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·V 2ULJLQHVLXULVFLYLOLV2ULJLQVRI&LYLO/DZ DQG5DJLRQSRHWLFD 3RHWLFV PDGHKLPRQHRIWKHIRUHPRVWILJXUHVRI,WDOLDQLQWHOOHFWXDO OLIH*UDYLQDGHILQHGWKHQHZLQWHOOHFWXDODVQRWRQO\DPDQRIOHWWHUV EXWDOVRDPDQRIUHDVRQDEOHWRDVVLVWLQHVWDEOLVKLQJWKHFRQVWLWXWLRQ RIWKHQHZDV\HWLGHDOFLYLOVRFLHW\7KHPDQZKRGLVFRYHUHGWKH

%285%211$3/(6

OLWHUDU\WDOHQWVRI0HWDVWDVLRLVDOVRIDPHGIRUKLVZLWWLFLVPVVXFK DV¶$ERUHLVDPDQZKRGHSULYHV\RXRIVROLWXGHZLWKRXWSURYLGLQJ \RXZLWKFRPSDQ\·,QDQDWWHPSWWRDYRLGDVVRFLDWLRQZLWKERUHV *UDYLQD HVWDEOLVKHG WKH HOLWH $UFDGLD OLWHUDU\ DFDGHP\ LQ *UDYLQD·VLGHDOVIRXQGWKHLUUHDOLVDWLRQLQWKHZULWLQJVRIKLVWRULDQ 3LHWUR*LDQQRQHDQGSKLORVRSKHU*LDPEDWWLVWD9LFR 3LHWUR *LDQQRQH ZDV ERUQ LQ D UHPRWH $SXOLDQ YLOODJH DQG UHFHLYHGKLVHGXFDWLRQLQ1DSOHVZKHUHKHUHDGODZDWWKHXQLYHUVLW\ $OOKLVOHLVXUHWLPHZDVGHYRWHGWRKLVWRULFDOUHVHDUFKDQGKHZDV DQ DVVLGXRXV KDELWXp RI WKH OLEUDULHV DQG DFDGHPLF VDORQV RI WKH FDSLWDO,QKLV DXWRELRJUDSK\ *LDQQRQH GHVFULEHV WKH DWPRVSKHUH RIHUXGLWLRQDQGGHEDWHKHLPELEHGLQ&DUGLQDO%UDQFDFFLR·VSULYDWH OLEUDU\¶,QHYHUPLVVHGDQRSSRUWXQLW\WRJRWKHUHDQGVWD\DOOWKH KRXUVLWZDVRSHQDQG,FDQ·WGHQ\WKDWLWZDVDJUHDWKHOSWRPH DQGYHU\XVHIXOQRWRQO\IRUWKHERRNV,IRXQGWKHUHZKLFKUHODWHG WRP\SURJUDPPHRIVWXGLHVEXWDOVRIRUWKHDFTXDLQWDQFH,PDGH WKHUHRIFXOWXUHGPHQDQGLQWHOOHFWXDOVRIWKHFLW\ZKRIUHTXHQWHG WKH OLEUDU\ ZKRVH ZLVH GLVFXVVLRQV JUHDWO\ LOOXPLQDWHG PH «· $IWHU\HDUVRILQWHQVHVWXG\DQGUHVHDUFKKHSXEOLVKHGWKH&LYLO +LVWRU\RIWKH.LQJGRPRI1DSOHVZKLFKZDVHQWKXVLDVWLFDOO\UHFHLYHG WKURXJKRXW(XURSHDQGWUDQVODWHGLQWRVHYHUDOODQJXDJHV7KH&LYLO +LVWRU\FDXVHGDVHQVDWLRQQRWRQO\IRU*LDQQRQH·VILQHVFKRODUVKLSLQ WKHV\QWKHVLVRIWKHQXPHURXVOHJDOV\VWHPVDQGLQVWLWXWLRQVZKLFK KDGJURZQXSXQGHUWKHYDULRXV1HDSROLWDQUHJLPHVEXWDOVRIRULWV VWURQJDQWLFOHULFDOELDV6RPHRIKLVUHPDUNVZHUHPLVLQWHUSUHWHG DQGLWZDVDOOHJHGWKDWKHKDGFDVWGRXEWVRYHUWKHPLUDFOHRIWKH OLTXHIDFWLRQRIWKHEORRGRI6DQ*HQQDUR²DQXQSDUGRQDEOHRIIHQFH LQ 1DSOHV 8QIRUWXQDWHO\ WKH ERRN FDPH WR WKH DWWHQWLRQ RI WKH HFFOHVLDVWLFDODXWKRULWLHVDQGZDVSODFHGRQWKH,QGH[6XFKZDVWKH HQVXLQJVFDQGDOWKDW*LDQQRQHZDVIRUFHGWRIOHH1DSOHVLQIHDUIRU KLVOLIH+HVRXJKWUHIXJHDWWKH+DEVEXUJFRXUWLQ9LHQQDZKHUHKH

,17+(6+$'2:2)9(689,86

HNHGRXWDOLYLQJRQDPHDJUHLPSHULDOSHQVLRQ,Q$XVWULDKHZURWH KLVRWKHUPDMRUZRUNWKH7ULUHJQRDVWXG\RIWHPSRUDODQGVSLULWXDO SRZHUFDQQLO\GHGLFDWHGWRWKH+DEVEXUJ(PSHURU*LDQQRQHODWHU GLHGLQH[LOHLQD3LHGPRQWSULVRQDIWHUKDYLQJEHHQWULFNHGLQWR UHWXUQLQJWR,WDO\EXWKHQHYHUDJDLQVHWIRRWLQ1DSOHV *LDPEDWWLVWD 9LFR D SURIHVVRU RI ODZ DQG UKHWRULF DW WKH 8QLYHUVLW\RI1DSOHVOLYHGDKHUPLWOLNHH[LVWHQFHDQGPLQGIXORI *LDQQRQH·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p'HVFDUWHVDQG WKH UDWLRQDOLVWV9LFR ZDV LQIOXHQFHG E\ 'XWFK SKLORVRSKHU +XJR *URWLXVZKRHVWDEOLVKHGWKHGRFWULQHRIQDWXUDOODZDQGVRXJKWWR UHFRQFLOHWKHPRGHUQLGHDOVRIFLYLOVRFLHW\ZLWK&DWKROLFLVP ,Q KLV VLE\OOLQH PDVWHUZRUN WKH 1HZ 6FLHQFH UHZULWWHQ DQG UHZRUNHGDOPRVWREVHVVLYHO\WKURXJKRXWKLVOLIHWLPH 9LFRVHWRXW WRSUHVHQWDQHZVFLHQFH¶RIFHUWDLQSULQFLSOHVRIWKHKXPDQLW\RIWKH QDWLRQVIURPZKLFKWKHUHLVQRGRXEWDOOWKHVFLHQFHVGLVFLSOLQHV DQG DUWV VWHP· ZKHUHLQ KH H[SRXQGHG KLV EHOLHI LQ D F\FOLFDO FRQFHSWRIKLVWRU\WKHFRUVLHULFRUVLVWRULFLWKHWKHRU\WKDWKLVWRU\ UHSHDWVLWVHOILQDFRQWLQXRXVUHSHWLWLYHSDWWHUQ 7RVXPPDULVHWKH

%285%211$3/(6

FRQWHQWV RI WKH 1HZ 6FLHQFH LV DQ HQGHDYRXU DOPRVW DV DUGXRXV DV WRUHDGLWIURPFRYHUWRFRYHUVLQFHLWLVDQH[FHHGLQJO\FRPSOH[ VWXG\RIKLVWRU\SKLORVRSK\SRHWU\WKHRORJ\DQGODZFRYHULQJD YDVWTXDQWLW\RILVVXHVLQFOXGLQJWKRVHZKLFKKDYHVLQFHJLYHQULVH WRVXFKGLVFLSOLQHVDVVRFLRORJ\DQGVRFLDODQWKURSRORJ\,QVSLWHRI WKHRULJLQDOLW\RIKLVWKRXJKW9LFR·VH[SUHVVLRQRIIDVFLQDWLQJDQG LQQRYDWLYH FRQFHSWV ZDV REIXVFDWHG E\ KLV YHUERVH VW\OH DQG WKH FRPSXOVLYHUHRUJDQLVDWLRQRIKLVPXOWLIDFHWHGVXEMHFWPDWWHUZLWK WKHUHVXOWWKDWKLVDFKLHYHPHQWVZHUHQRWUHDGLO\DFNQRZOHGJHGE\ PDQ\RIKLVFRQWHPSRUDULHVZKRVDZKLPDVDGU\ROGFXUPXGJHRQ 1RQHWKHOHVV9LFRKDGDSURIRXQGLQIOXHQFHRQKLVPDQ\VWXGHQWVDW WKHXQLYHUVLW\LQFOXGLQJWKHEULJKWHVWVSDUNVRIWKHQH[WJHQHUDWLRQ PHQVXFKDVWKHHFRQRPLVW$QWRQLR*HQRYHVLZKRRSHQO\GHFODUHG KLVDGPLUDWLRQ9LFR·VRULJLQDOLW\DQGKLVSURIRXQGFRQWULEXWLRQWR WKH KLVWRU\ RI LGHDV ZHUH QRW IXOO\ DSSUHFLDWHG XQWLO PDQ\ \HDUV DIWHUKLVGHDWK+HZRXOGSUREDEO\EHYHU\VXUSULVHGE\WKHFXUUHQW GHYHORSPHQWRI¶9LFR6WXGLHV·DVDQDUHDRIDFDGHPLFVSHFLDOLVDWLRQ 7RGD\WKHUHDUHVHYHUDOVFKRODUO\MRXUQDOVGHYRWHGH[FOXVLYHO\WRWKH VWXG\RI9LFR·VZULWLQJVDQGFHQWUHVIRU9LFR6WXGLHVH[LVWDWPDQ\ XQLYHUVLWLHVDFURVVWKHJOREH%HQHGHWWR&URFHLVJHQHUDOO\FUHGLWHG ZLWKWKHUHGLVFRYHU\RI9LFRKDLOLQJWKHSRHWDQGSKLORVRSKHUDVD PDQERUQEHIRUHKLVWLPH9LFRZHQWRQWRH[HUWDQDFNQRZOHGJHG LQIOXHQFHRYHUVXFKGLYHUVHILJXUHVDV.DUO0DU[DQG-DPHV-R\FH ,QGHHG9LFR·V FRUVLHULFRUVLVWRULFLDUHWKHDFNQRZOHGJHGLQVSLUDWLRQ IRUWKH¶YLVFRXVFLUFOHV·RI)LQQHJDQV: DNH $W WKH VDPH WLPH DV WKH FLW\·V LQWHOOHFWXDO OLIH ZDV VR YLEUDQW 1DSOHVKDGEHJXQRQFHDJDLQWRH[HUWKHUKROGRYHUWKHIRUWXQDWH ZKRFRXOGDIIRUGKHUSOHDVXUHV(DUOLHUYR\DJHVWR,WDO\KDGEHHQ SLOJULPDJHVZLWKWKHFHQWUHRI&KULVWHQGRPLQ5RPHDVWKHLUIRFXV EXW QRZ WUDYHOOHUV IURP DOO RYHU (XURSH ZHUH DWWUDFWHG E\ WKH FODVVLFDOKHULWDJHRI1DSOHV7DNLQJDGYDQWDJHRIDSHULRGZKHQWKH

,17+(6+$'2:2)9(689,86

FRQWLQHQWZDVUHODWLYHO\IUHHIURPWKHZDUVZKLFKKDGKDPSHUHG WUDYHOIRUVRPDQ\FHQWXULHVYLVLWRUVWR5RPH)ORUHQFH1DSOHV 9HQLFHDQGRWKHU,WDOLDQFLWLHVFDPHWRDGPLUHWKHSDVW$VWKHJUHDW DQG WKH JRRG KDG RQFH IORFNHG IURP $QFLHQW 5RPH WR LQGXOJH LQ FDUHIUHH UHOD[DWLRQ LQ 1DSOHV VR RQFH DJDLQ ZHDOWK\ WUDYHOOHUV DUULYHG IURP WKURXJKRXW (XURSH WR H[SHULHQFH WKH GHOLJKWV RQ RIIHULQWKHPRVWVHGXFWLYHRIFLWLHV7KHIDPHGPXVLFDOWUDGLWLRQ DQG WKH DUHD·V DVVRFLDWLRQV ZLWK DQWLTXLW\ QRZ PDGH HYHQ PRUH YLEUDQWZLWKWKHGLVFRYHULHVRI3RPSHLLDQG+HUFXODQHXPWRJHWKHU ZLWKWKHLQWR[LFDWLQJORFDOFKDUPVDOOFRPELQHGWRPDNH1DSOHVWKH FXOPLQDWLQJH[SHULHQFHRIWKH*UDQG7RXUJHQHUDOO\DFFHSWHGDVDQ LQWHJUDOSDUWRIDJHQWOHPDQ·VHGXFDWLRQLQWKHHLJKWHHQWKFHQWXU\ 7KHVWUHDPRIWRXULVWVFRQVWDQWO\LQFUHDVHGGHGLFDWLQJWKHPVHOYHV WRRWLXPOLWWHUDWXPVLYHVWXGLRVXPOHLVXUHVSHQWLQHQWKXVLDVWLFOHDUQLQJ KDUNLQJEDFNWR1DSOHV·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

%285%211$3/(6

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·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·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

,17+(6+$'2:2)9(689,86

HFFHQWULF GHSLFWLRQV VRPHWLPHV UHIHUUHG WR DV¶FDSULFHV· E\ KLV FRQWHPSRUDULHV 7KHVH SRUWUD\HG URPDQWLF ODQGVFDSHV EDWWOHV SKLORVRSKHUVDQGHYHQVFHQHVRIZLWFKFUDIW:LWKDWKLUVWIRUFXOWXUH DQGHUXGLWLRQ5RVDVRXJKWUHFRJQLWLRQDVDSDLQWHURIKLVWRULFDODQG ELEOLFDOVXEMHFWV6DOYDWRUH5RVDZDVDOVRDSUROLILFSRHWPLPHDQG PXVLFLDQ,QGHHGKHLVWKRXJKWWREHWKHDXWKRURIWKHIDPRXVVRQJ 0LFKHOHPPj5RVD·VDFHUELFZLWDWWDFNHGIHOORZDUWLVWVWKH5RPDQ FXULD DQG HYHQ WKH SDSDF\ ZKLOH KLV LQWHUQDWLRQDO UHSXWDWLRQ SURGXFHGLQYLWDWLRQVIURPWKHUR\DOFRXUWVRI6ZHGHQDQG)UDQFH &RPPHQWLQJRQ 5RVD·V H[WUHPHO\ RULJLQDO ODQGVFDSHV 6LU -RVKXD 5H\QROGVUHPDUNHG +HKDVWKDWVRUWRIGLJQLW\ZKLFKEHORQJVWRVDYDJHDQGXQFXOWLYDWHG QDWXUH EXW ZKDW LV PRVW WR EH DGPLUHG LQ KLP LV WKH SHUIHFW FRUUHVSRQGHQFH ZKLFK KH REVHUYHG EHWZHHQ WKH VXEMHFWV ZKLFK KH FKRVHDQGWKHPDQQHURIWUHDWLQJWKHP(YHU\WKLQJLVRIDSLHFHKLV URFNVWUHHVVN\HYHQWRKLVKDQGOLQJKDYHWKHVDPHUXGHDQGZLOG FKDUDFWHUZKLFKDQLPDWHVKLVILJXUHV

/DG\0RUJDQ·VHQWKXVLDVWLF /LIHDQG7LPHVRI6DOYDWRUH5RVDPDGHWKH DUWLVWYHU\IDVKLRQDEOHLQHDUO\QLQHWHHQWKFHQWXU\(QJODQGZKHUH KLVQDPHEHFDPHYLUWXDOO\V\QRQ\PRXVZLWKWKHSLFWXUHVTXH (WLQ$UFDGLDHJR«7KLVP\VWHULRXVSKUDVHZKLFKILUVWPDGHLWV DSSHDUDQFHLQFDQYDVHVE\*XHUFLQRDQG3RXVVLQFDPHWRV\PEROLVH WKHIDVFLQDWLRQH[HUWHGE\DQWLTXLW\LQWKH$JHRI5HDVRQ6DQQD]DUR·V SRHP $UFDGLD UHYLYHG WKH SDVWRUDO JHQUH LQ WKH 5HQDLVVDQFH EXW WKH FRQFHSW RI$UFDGLD ZDV ILUVW HYRNHG LQ9LUJLO·V (FORJXHV EULHI YLJQHWWHV RI UXVWLF OLIH )URP WKH HDUOLHVW GD\V RI WKH VWXG\ RI /DWLQVFKRROERRNVWUDGLWLRQDOO\EHJDQZLWKWKHILUVW(FORJXHZKLFK FRPPHQFHG¶7LWLURUHVWLQJLQWKHVKDGHRIWKHEUDQFKHVRIDEHHFK WUHHSOD\VDZRRGODQGVRQJRQKLVGHOLFDWHIOXWH·WKHUHE\HYRNLQJ WKH WKHPH RI$UFDGLD IURP WKH YHU\ ILUVW FRQWDFW ZLWK WKH /DWLQ

%285%211$3/(6

ODQJXDJH-RKDQQ:ROIJDQJYRQ*RHWKHWUDQVSRVHGWKHFRQFHSWRI WKHLGHDOLVHGOLIHVW\OHRI$UFDGLDWRFRQWHPSRUDU\,WDO\ZKHQKHXVHG WKHHQLJPDWLFSKUDVHWRGHVFULEHKLVWUDYHOVLQWKH,WDOLDQSHQLQVXOD ²$XFK LFK LQ$UNDGLHQ ² VLJQDOOLQJ KLV URPDQWLFLVHG DQG QRVWDOJLF HQJDJHPHQWZLWKWKHFODVVLFDOZRUOG:LWKWKHDGYHQWRIWKH*UDQG 7RXU1DSOHVEHFDPHRQFHDJDLQWKHLGHDOLVHGORFXVDPRHQXVFHOHEUDWHG E\+RPHUDQG9LUJLOWKHSOHDVDQWORFDWLRQIRUDMR\IXODQGEHDXWLIXO H[LVWHQFHVXUURXQGHGE\VWXQQLQJQDWXUDOVFHQHU\RIIHULQJWKHGXDO HQWLFHPHQWVRIVHQVXDOSOHDVXUHDQGFXOWXUDOUHIUHVKPHQW1DSOHV SURYLGHGIDUPRUHWKDQPHUHDVVRFLDWLRQZLWKORVWDQWLTXLW\²LWV LQWR[LFDWLQJ DQG VHGXFWLYH FRQWHPSRUDU\ OLIHVW\OH ZDV LUUHVLVWLEOH WR PRVW YLVLWRUV %RXUERQ 1DSOHV ZDV D OLYHO\ FRVPRSROLWDQ FLW\ ZLWK D GD]]OLQJ \RXWKIXO FRXUW ,OOXVWULRXV YLVLWRUV RQ WKH *UDQG 7RXUZHUHLQH[RUDEO\GUDZQWRWKHFLW\DQGWKURXJKRXW(XURSH URPDQWLF QRVWDOJLD SODFHG PHPRULHV RI$UFDGLDQ EOLVV DERYH WKH GHMHFWLRQVRIWKHSUHVHQW *RHWKHZDVWKHVXSUHPHSRHWRIWKH*UDQG7RXUDQGKHFU\VWDOOLVHG WKHFLW\·VUDSWXURXVDQGLG\OOLFLPDJH+LVWLPHLQ,WDO\DQGLQ1DSOHV HVSHFLDOO\ZDVWRFKDQJHKLVOLIHDQGKLVSRHWU\IRUHYHU$VPDQ\ WUDYHOOHUV EHIRUH DQG DIWHU *RHWKH HQWKXVHG¶2QH PD\ ZULWH RU SDLQWDVPXFKDVRQHOLNHVEXWWKLVSODFHWKHVKRUHWKHED\9HVXYLXV WKHFLWDGHOVWKHYLOODVHYHU\WKLQJGHILHVGHVFULSWLRQ·,QPLGGOHDJH WKH*HUPDQZULWHUOHIWKLVVHQVLEOHDGPLQLVWUDWLYHSRVLWLRQLQWKH :HLPDUJRYHUQPHQWWRVSHQGWZR\HDUVWUDYHOOLQJLQ,WDO\ZKHUH KHXQGHUZHQWDQLQWHQVHH[SHULHQFHRIDZDNHQLQJDFFRPSDQLHGE\ DIHYHULVKERXWRIZULWLQJ7KLVH[SHULHQFHDQGWKHFKDQJHLQKLVOLIH WKDWIROORZHGKLVVWD\LQ,WDO\ZHUHUHFRXQWHGLQKLV,WDOLDQ7UDYHOV 7KHHQJUDYHU-RKDQQ7LVFKEHLQ·VFHOHEUDWHGSRUWUDLWRI*RHWKHLQ ,WDO\VKRZVWKHSRHWUHFOLQLQJLQIURQWRIDVPRXOGHULQJ9HVXYLXV $OWKRXJKDOHDUQHGPDQ*RHWKHZDVSHUKDSVOHVVLQWULJXHGE\WKH FLW\·VFODVVLFDOKHULWDJHWKDQE\LWVFRQWHPSRUDU\OLIHVW\OH

,17+(6+$'2:2)9(689,86

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

,WLVVXUSULVLQJWKDWVXFKDVHQVLWLYHDQGLQWHOOLJHQWPDQZDVEOLQG WRWKHKDUVKUHDOLWLHVRIOLIHLQ%RXUERQ1DSOHV*RHWKH·VYLHZRI ,WDO\LQJHQHUDODQG1DSOHVLQSDUWLFXODUZDVKLJKO\URPDQWLFLVHG :KLOHLWLVWUXHWKDWWKHFOLPDWHDOORZHGWKHXUEDQSRRURI1DSOHV DQ HDVLHU WLPH SHUKDSV WKDQ WKRVH LQ D VLPLODU VLWXDWLRQ OLYLQJ LQ 1RUWKHUQ(XURSHLWLVDOVRWUXHWKDWWKHVLWXDWLRQUHTXLUHGSUHVVLQJ VRFLDO LVVXHV WR EH DGGUHVVHG *RHWKH·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

%285%211$3/(6

HYHU\VHDVRQRIWKH\HDUZKHQRQHUHPHPEHUVWKDWWKHUHJLRQDURXQG 1DSOHVLVGHVHUYHGO\FDOOHG7HUUDGL/DYRURZKLFKGRHVQRWPHDQWKH ODQGRIZRUNEXWWKHODQGRIFXOWLYDWLRQ DQGWKDWWKHZKROHSURYLQFH KDVEHHQKRQRXUHGIRUFHQWXULHVZLWKWKHWLWOH&DPSDJQD)HOLFH²WKH KDSS\ODQG²WKHQRQHJHWVDQLGHDRIKRZHDV\OLIHLVLQWKHVHSDUWV «7KHVRFDOOHGOD]]DURQHLVQRWDZKLWOHVVEXV\WKDQDQ\RWKHUFODVV DQG«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

/LNHPDQ\DWUDYHOOHUEHIRUHDQGDIWHUKLP*RHWKHZDVFDSWLYDWHG E\WKHYLWDOLW\RI1DSOHV+HPHQWLRQVVXUSULVLQJO\OLWWOHLQKLVOHWWHUV DERXWWKHHGXFDWLRQDOYDOXHRIWKHFODVVLFDOPRQXPHQWVRIWKHFLW\ HYHQ WKRXJK LQ WKH FRXUVH RI KLV ORQJ OLIH *RHWKH ZHQW RQ WR LQVSLUHWKH+HOOHQL]LQJVWUDLQRI5RPDQWLFLVPWKDWVHQW\RXQJPHQ RIIWRUHGLVFRYHUDQGVZRRQRYHUWKHUXLQVDQGUHPDLQVRIDQWLTXLW\ ,QGHHGWKHZULWHUH[FODLPHGLQKLVOHWWHUVKRPH¶,Q5RPH,ZDV JODGWRVWXG\KHUH,ZDQWRQO\WROLYHIRUJHWWLQJP\VHOIDQGWKH ZRUOGDQGLWLVDVWUDQJHH[SHULHQFHIRUPHWREHLQDVRFLHW\ZKHUH HYHU\RQH GRHV QRWKLQJ EXW HQMR\ KLPVHOI· ,W VHHPV WKDW VHQVXDO GHOLJKWVZHUHDJUHDWHUSULRULW\WKDQERRNOHDUQLQJGXULQJWKHSRHW·V VWD\ LQ 1DSOHV:LWK UHJDUG WR YDULRXV SRUWUDLWV RI *RHWKH:+ $XGHQKDVREVHUYHGWKDW¶7KHGLIIHUHQFHEHWZHHQWKHRYHUUHILQHG GHOLFDWHDOPRVWQHXUDVWKHQLFIDFHRIWKHSUH,WDOLDQSRUWUDLWVDQGWKH PDVFXOLQHVHOIDVVXUHGIDFHLQWKHSRUWUDLWVH[HFXWHGDIWHUKLVUHWXUQ LVYHU\VWULNLQJWKHODWWHULVWKDWRIDPDQZKRKDVNQRZQVH[XDO

,17+(6+$'2:2)9(689,86

VDWLVIDFWLRQ·8SRQKLVUHWXUQWR:HLPDU*RHWKHFRQWLQXHGWRSOD\ WKHSDUWRIWKHUHVSRQVLEOHDFDGHPLFDQGJRYHUQPHQWPDQGDULQEXW KLVKHDUWUHPDLQHGLQ,WDO\+HEHFDPHDQHQWKXVLDVWLFFROOHFWRURI FODVVLFDOREMHFWVDQGPHPHQWRVDQGSRXUHGRXWVWUHDPVRIVHQVXDO YHUVHLQWKH5RPDQ(OHJLHVZULWWHQIRUKLV\RXQJPLVWUHVV&KULVWLDQH 7KHVH[XDODZDNHQLQJH[SHULHQFHGE\*RHWKHLQ1DSOHVZDVQRWD XQLTXHRFFXUUHQFH'HVFULELQJWKHFRQWHPSRUDU\VFHQH'U0RRUH ZDVZHOODZDUHRIWKHFLW\·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

7KH PRVW LOOXVWULRXV IHPPH IDWDOH LQ 1DSOHV VLQFH WKH GHDWK RI 3DUWKHQRSH ZDV XQGRXEWHGO\ WKH (QJOLVK URVH (PPD ZLIH RI 6LU :LOOLDP +DPLOWRQ WKH %ULWLVK (QYR\ ([WUDRUGLQDU\ DQG 0LQLVWHU 3OHQLSRWHQWLDU\ DW WKH %RXUERQ FRXUW 7KH +DPLOWRQV· VDORQDW3DOD]]R6HVVDEHFDPHDFRPSXOVRU\VWRSIRUVRSKLVWLFDWHG WUDYHOOHUVIURPWKURXJKRXW(XURSH6LU:LOOLDPVSHQWPXFKRIKLV WLPHFXOWLYDWLQJLQWHUHVWVLQDQWLTXLWLHVDQGYXOFDQRORJ\+HZDVD FRQQRLVVHXUDQGFROOHFWRUHVSHFLDOO\RIYDVHVVXFKDVWKHPDJQLILFHQW 3RUWODQG9DVHZKLFKWRGD\LVRQHRIWKHPRVWLPSRUWDQWSLHFHVRI WKH%ULWLVK0XVHXP·V FROOHFWLRQ 6LU:LOOLDP DSSOLHG WKH VFLHQWLILF PHWKRGWRKLVREVHUYDWLRQVRI9HVXYLXVZKLFKKHVWXGLHGRYHUWKH

%285%211$3/(6

FRXUVH RI PRUH WKDQ YLVLWV WR WKH FUDWHU +H ZDV PHVPHULVHG E\WKHSKHQRPHQRQRILWVHUXSWLRQ¶,WLVLPSRVVLEOHWRGHVFULEHWKH JORULRXVVLJKWRIDULYHURIOLTXLGILUHQRUWKHHIIHFWRIWKRXVDQGVRI UHGKRWVWRQHVWKURZQXSDWOHDVW\DUGVKLJKDQGUROOLQJGRZQ WKHVLGHRIWKHPRXQWDLQZKHQWKH\IHOO·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

,17+(6+$'2:2)9(689,86

/RXVLH(OL]DEHWK9LJpH/H%UXQ/DG\+DPLOWRQDVD %DFFKDQWH

%285%211$3/(6

EHDXW\DQGQDWXUDOSRLVHDUHHYLGHQWLQYDULRXVSRUWUDLWVE\5RPQH\ DQG9LJpHOH%UXQ*RHWKHYLVLWHG+DPLOWRQQRWRQO\WRH[DPLQHKLV DQFLHQWYDVHVDQGPLQHUDOFROOHFWLRQEXWDOVRWRJD]HDYLGO\RQ/DG\ +DPLOWRQ·VOHJHQGDU\¶WDEOHDX[·(PPDZRXOGVWULNHSRVHVGUHVVHG DVILJXUHVIURPFODVVLFDOP\WKRORJ\HQDFWLQJIDPRXVDQFLHQWWDOHV ,WZDVSHUKDSVIRUWKHEHVWWKDW/RUG+DPLOWRQ·VEHDXWLIXOPLVWUHVV GLG QRW VSHDN DV KHU YRLFH DQG DFFHQW ZRXOG KDYH EHWUD\HG KHU EDFNJURXQGZKLFKZDVLPSRVVLEOHWRGLVFHUQIURPKHUDSSHDUDQFH DQGPDQQHULVPV*RHWKHZDVRQHRIPDQ\ZKRREVHUYHG(PPD·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²VWDQGLQJNQHHOLQJVLWWLQJUHFOLQLQJDQ[LRXV²RQH SRVHIROORZVDQRWKHUZLWKRXWDEUHDN6KHNQRZVKRZWRDUUDQJHWKH IROGVRIKHUYHLOWRPDWFKHDFKPRGHDQGKDVDKXQGUHGZD\VRIWXUQLQJ LW LQWR D KHDGGUHVV7KH ROG NQLJKW LGROL]HV KHU DQG LV HQWKXVLDVWLF DERXWHYHU\WKLQJVKHGRHV,QKHUKHKDVIRXQGDOOWKHDQWLTXLWLHVDOO WKH SURILOHV RI 6LFLOLDQ FRLQV HYHQ WKH$SROOR %HOYHGHUH7KLV PXFK LVFHUWDLQDVDSHUIRUPDQFHLW·VOLNHQRWKLQJ\RXHYHUVDZEHIRUHLQ \RXUOLIH:HKDYHDOUHDG\HQMR\HGLWRQWZRHYHQLQJV7KLVPRUQLQJ 7LVFKEHLQLVSDLQWLQJKHUSRUWUDLW

7RZLGHVSUHDGDPD]HPHQWDEHVRWWHGDQGSRVVLEO\EHIXGGOHG6LU :LOOLDPPDUULHG(PPDDW6W*HRUJH·V+DQRYHU6TXDUHGXULQJDYLVLW WR/RQGRQ$OWKRXJK4XHHQ&KDUORWWHUHIXVHGWRUHFHLYH(PPDDW

,17+(6+$'2:2)9(689,86

FRXUWWKHUHZDVQRRIILFLDOUR\DOREMHFWLRQWRWKHPDWFK7KHJUHDWHVW ORWKDULRRIWKHGD\*LDFRPR&DVDQRYDSURSKHWLFDOO\UHPDUNHG 0U+DPLOWRQZDVDJHQLXVDQG\HWKHHQGHGE\PDUU\LQJDPHUHJLUOZKR ZDVFOHYHUHQRXJKWRPDNHKLPIDOOLQORYHZLWKKHU6XFKDPLVIRUWXQH RIWHQFRPHVWRFOHYHUPHQLQWKHLUROGDJH0DUULDJHLVDOZD\VDIROO\EXW ZKHQDPDQPDUULHVD\RXQJZRPDQDWDWLPHRIOLIHZKHQKLVSK\VLFDO VWUHQJWKLVUXQQLQJORZKHLVERXQGWRSD\GHDUO\

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·VDQGKHUKHDUWLV PRVWH[FHOOHQWDQGVWULFWO\JRRGDQGXSULJKW«

/DG\+DPLOWRQZDVIODWWHUHGE\WKH4XHHQ·VLQWHUHVWDQGWKH4XHHQ LQ WXUQ ZDV GHOLJKWHG WR KDYH D GLUHFW FRQGXLW WR WKH %ULWLVK DV UHODWLRQVEHWZHHQ1DSOHVDQG)UDQFHEHFDPHLQFUHDVLQJO\VWUDLQHG IROORZLQJWKHLPSULVRQPHQWRIKHUVLVWHU0DULH$QWRLQHWWHZLIHRI WKH)UHQFKNLQJ(PPDIRXQGLWDVHDV\WRFDSWLYDWH4XHHQ0DULD &DUROLQD DV VKH KDG WR HQWUDQFH KHU KXVEDQG EXW KHU OHJHQGDU\ SRZHUVRIVHGXFWLRQKDG\HWWRPHHWWKHLUXOWLPDWHWDUJHW

%285%211$3/(6

)DOORXW IURP WKH )UHQFK 5HYROXWLRQ ZDV DERXW WR FKDQJH WKH FLW\ GUDPDWLFDOO\ DQG D VHULHV RI UHPDUNDEOH HYHQWV IROORZHG WKH DUULYDO RI$GPLUDO +RUDWLR 1HOVRQ LQ 1DSOHV LQ DERDUG WKH $JDPHPQRQ+HZDVRQDGLSORPDWLFPLVVLRQWRVWHDG\WKHUHVROYH RI.LQJ)HUGLQDQGDQG4XHHQ0DULD&DUROLQDLQWKHLURSSRVLWLRQWR )UDQFHDQGWRVWUHQJWKHQWKHERQGVRIWKHWUHDW\ZKLFKKDGEHHQ VLJQHG EHWZHHQ (QJODQG DQG 1DSOHV RQO\ WZR PRQWKV HDUOLHU$V 1HOVRQVDLOHGLQWRWKHPDJQLILFHQWED\KHZLWQHVVHGWKHGUDPDWLF VLJKWRI9HVXYLXVLQIXOOHUXSWLRQ¶WKHODYDVSUHDGLQJIURPWKHWRS DQG UROOLQJ GRZQ WKH PRXQWDLQ LQ JUHDW VWUHDNV RI ILUH· 1HOVRQ SXUVXHGKLVGLSORPDWLFPLVVLRQZLWKWKHDVVLVWDQFHDQGVXSSRUWQRW RQO\RI6LU:LOOLDP+DPLOWRQEXWDOVRIHOORZ%ULWRQ$GPLUDO$FWRQ WKH TXHHQ·V WUXVWHG PLQLVWHU %RWK PHQ ZDUPHG LPPHGLDWHO\ WR 1HOVRQ·VPLVVLRQDQG$FWRQZDVDEOHWRSURPLVHWKDWWZRWKRXVDQG WURRSVZRXOGEHVHQWWRVXSSRUWWKH%ULWLVKDW7RXORQ1HOVRQPHW (PPDIOHHWLQJO\RQWKLVILUVWYLVLWWR1DSOHVDQGGHVFULEHGKHULQD OHWWHUWRKLVZLIH¶6KHLVD\RXQJZRPDQRIDPLDEOHPDQQHUVDQG ZKRGRHVKRQRXUWRWKHVWDWLRQLQZKLFKVKHLVUDLVHG·$IWHUWKLV LQLWLDO EULHI HQFRXQWHU (PPD DQG 1HOVRQ ZHUH QRW WR VHH HDFK RWKHUDJDLQIRUILYH\HDUV )ROORZLQJ WKH %DWWOH RI WKH 1LOH 1HOVRQ·V VKLS WKH 9DQJXDUG UHTXLUHG UHSDLUV DQG 1HOVRQ VDLOHG IRU WKH VKLS\DUGV LQ 3RVLOOLSR SHUKDSV KRSLQJ WR LQGXOJH RQFH DJDLQ LQ D IHZ GD\V RI UHVW DQG UHOD[DWLRQ LQ 1DSOHV +LV YDQLW\ ZDV PRVW JUDWLILHG ZKHQ KH ZDV UHFHLYHGDVDFRQTXHULQJKHURDFFODLPHGE\DOODV1RVWUR/LEHUDWRUH (ODWHGZLWKKLVVXFFHVVRYHUWKH)UHQFK/DG\+DPLOWRQDQG4XHHQ 0DULD &DUROLQD JDYH 1HOVRQ D KHUR·V ZHOFRPH $QWL)UHQFK DQG SUR%ULWLVKVHQWLPHQWZDVDWLWVDSRJHHLQ1DSOHVGXULQJ1HOVRQ·V YLVLWDQGKHZDVJUHHWHGZLWKURDULQJDFFODLP(PPDKDGFKDQJHG VRPHZKDW RYHU WKH \HDUV +HU PDUULDJH KDG EURXJKW KHU VWDELOLW\ DQGKDSSLQHVVEXWVKHZDVQRORQJHUWKHOLWKH\RXQJEHDXW\1HOVRQ

,17+(6+$'2:2)9(689,86

KDGILUVWPHW1RZDJHGVKHKDGSXWRQDFRQVLGHUDEOHDPRXQW RIZHLJKWDQGLVGHVFULEHGE\DFRQWHPSRUDU\REVHUYHUDV¶QRWKLQJ VKRUWRIPRQVWURXVLQHQRUPLW\DQGJURZLQJHYHU\GD\·6LU:LOOLDP LQYLWHG 1HOVRQ WR VWD\ DV WKHLU JXHVW RQ VKRUH DW 3DOD]]R 6HVVD ¶$SOHDVDQWDSDUWPHQWLVUHDG\IRU\RXLQP\KRXVHDQG(PPDLV ORRNLQJRXWIRUWKHVRIWHVWSLOORZVWRUHSRVHWKHIHZZHDULHGOLPEV \RXKDYHOHIW·1HOVRQRQFHDJDLQPHQWLRQHG(PPDLQDOHWWHUWRKLV ZLIH¶,KRSHRQHGD\WRKDYHWKHSOHDVXUHRILQWURGXFLQJ\RXWR/DG\ +DPLOWRQ6KHLVRQHRIWKHYHU\EHVWZRPHQLQWKHZRUOG+RZIHZ FRXOGKDYHPDGHWKHWXUQVKHKDV6KHLVDQKRQRXUWRKHUVH[· ,QWHOOHFWXDOVGHEDWHGWKHYLUWXHVRIUHYROXWLRQDQGUDGLFDOVRFLDO UHIRUPEXWWKHOD]]DURQLZHUHGHYRWHGWRWKHLUNLQJDQGGLVOLNHG DQ\WKLQJ)UHQFKHYHQSURJUHVV7KHVDGIDWHRIWKHTXHHQ·VVLVWHU 0DULH$QWRLQHWWH DIIHFWHG KHU GHHSO\ DQG VKH KDUERXUHG D GHHS UHVHQWIXOKDWUHGRIWKH)UHQFKUHJLPH8SRQUHFHLYLQJQHZVRIKHU VLVWHU·VH[HFXWLRQWKH4XHHQRI1DSOHVSODFHGKHUSKRWRJUDSKRQ KHUGHVNDQGYRZHG¶-HSRXUVXLYHUDLPDYHQJHDQFHMXVTX·DXWRPEHDX·¶, VKDOOVHHNP\YHQJHDQFHXQWLOGHDWK· 6LU:LOOLDPDQG/DG\+DPLOWRQ SXW DOO WKHLU HQHUJLHV LQWR PDNLQJ 1HOVRQ·V VWD\ FRPIRUWDEOH DQG FHOHEUDWHG KLP ZLWK SDUWLHV EDOOV GLQQHUV DQG UHFHSWLRQV 6LU :LOOLDP ZDV VR SURXG RI WKH QDYDO KHUR·V SDWULRWLF DFKLHYHPHQWV WKDWKHFRXOGWKLQNRIOLWWOHHOVHEXWKLVGHVLUHWRUHQGHUKRPDJHWR 1HOVRQDQGPDNHKLVVWD\LQ1DSOHVDVSOHDVDQWDVSRVVLEOH ,KDYHKDGWKHVLQJXODUVDWLVIDFWLRQRIKDYLQJRQHRIWKHILUVWPHQLQWKH ZRUOGDQGRXU)ULHQG6LU+RU1HOVRQLQP\KRXVH$OWKRXJKQHFHVVDU\ )HWHV,OOXPLQDWLRQVHWFKDYHUXLQHGPHIRUWKHSUHVHQW,KDGUDWKHU OLYHRQEUHDGDQGFKHHVHWKHUHVWRIP\OLIHWKDQQRWKDYHGRQHZKDW ZDVULJKWIRUPHWRGRRQWKLVJUHDWRFFDVLRQ

,W LV GRXEWIXO DW WKLV SRLQW LI KH UHDOLVHG WKDW KLV KRVSLWDOLW\ ZDV H[WHQGLQJDVIDUDVDORDQRIKLVZLIH·VIRUPLGDEOHFKDUPV

%285%211$3/(6

,QWKHJHQHUDOHQWKXVLDVPLWZDVLQLWLDOO\IDLUO\GLIILFXOWWRGLVFHUQ 1HOVRQ·V JURZLQJ LQWHUHVW LQ KLV REOLJLQJ KRVWHVV:KHQ WKH ILUVW GLVFUHHWUXPRXUVUHDFKHG/RQGRQWKH0HGLWHUUDQHDQ&RPPDQGHU /RUG6W9LQFHQWPDGHDIHHEOHDWWHPSWWRVWRSWKHLQHYLWDEOHZULWLQJ WR/RUG+DPLOWRQZLWKDQLQGLUHFWDGPRQLVKPHQW¶3UD\GRQRWOHW \RXUIDVFLQDWLQJ1HDSROLWDQ'DPHVDSSURDFKWRRQHDUKLPIRUKH LVPDGHRIIOHVK EORRG FDQQRWUHVLVWWKHLUWHPSWDWLRQ·,I/RUG 6W9LQFHQWKDGUHDGKLV+RPHUFDUHIXOO\KHPLJKWKDYHUHDOLVHGWKDW LWZRXOGWDNHDVXSHUKXPDQHIIRUWIRUDIDWLJXHGVDLORUWRUHVLVWWKH VLUHQ VRQJ RI WKLV ODWWHUGD\ 3DUWKHQRSH 1HOVRQ UHFXSHUDWHG LQ 1DSOHVE\WDVWLQJDOORIWKHFLW\·VGHOLJKWV+HGLQHGDWWKH5R\DO 3DODFHYLVLWHGWKH6DQ&DUOR2SHUD+RXVHFOLPEHGWRWKHWRSRI 9HVXYLXV WR REVHUYH WKH HUXSWLQJ FUDWHU DQG PDGH H[FXUVLRQV WR +HUFXODQHXP3RPSHL&XPDDQG%DLD+HVDLOHGLQWKHED\DERDUG SOHDVXUHFUDIWDQGZDVDJXHVWDWWKHPDJQLILFHQW3DODFHRI&DVHUWD $WHYHU\PRPHQW(PPDZDVE\KLVVLGH$VKHGHVFULEHGWKHORFDO GHOLJKWV LQ OHWWHUV KRPH KLV ZLIH GHFLGHG WKDW VKH WRR ZRXOG WUDYHO WR 1DSOHV WR HQMR\ KHU KXVEDQG·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

,17+(6+$'2:2)9(689,86

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·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

%285%211$3/(6

DUPVKHPLGGOHDJHGDQGSOXPSZKLFKIRUWXLWRXVO\DOORZHGKHU WRKLGHKHUDGXOWHURXVSUHJQDQF\IRUVHYHUDOPRQWKV 7KHLQWHQVLW\ RI WKHLU SDVVLRQ HPHUJHV IURP WKHLU FRUUHVSRQGHQFH DV FDQ EH REVHUYHGLQWKLVOHWWHUZULWWHQE\1HOVRQWR(PPDGXULQJRQHRI WKHLUVHSDUDWLRQV /DVW1LJKW,GLGQRWKLQJEXWGUHDPRI
6HGXFHG E\ (PPD·V FKDUPV DQG LQWR[LFDWHG E\ WKHLU DGXOWHURXV SDVVLRQ WKH %ULWLVK QDYDO KHUR OHIW EHKLQG D FLW\ JULSSHG E\ UHYROXWLRQ$SLYRWDOFKDSWHULQWKHKLVWRU\RI1DSOHVKDGFRPHWR LWVDEUXSWFRQFOXVLRQ 3DUWKHQRSHDQ5HSXE OLF

$V WKH HLJKWHHQWK FHQWXU\ GUHZ WR LWV FORVH 1DSOHV UHWDLQHG D FKLDURVFXURSDOHWWHKHUVXSHUILFLDOGHOLJKWVQRORQJHUDEOHWRSDSHU RYHUWKHFUDFNVRIDIHXGDONLQJGRPXQZLOOLQJWRLPSOHPHQWUHIRUP RUFRQVWUXFWDGHPRFUDWLFFLYLOVRFLHW\$UPHGZLWKWKHLUIDLWKLQ 5HDVRQWKHHPHUJHQWPLGGOHFODVVRISURIHVVLRQDOVDQGLQWHOOHFWXDOV SXVKHG IRU IDUUHDFKLQJ UHIRUPV DQG VFKRODUO\ DFDGHPLHV ZHUH

,17+(6+$'2:2)9(689,86

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¶OLEHUW\WUHHV·ZHUHSODQWHGWKURXJKRXW1DSOHV (YHQWKHVWDIIDQGVWXGHQWVRIWKHSUHVWLJLRXV1XQ]LDWHOODPLOLWDU\ DFDGHP\VLGHGZLWKWKH-DFRELQV 3ROLWLFDOYLHZVZHUHGLYLGHGDORQJFODVVOLQHVDQGWKH3DUWKHQRSHDQ 5HSXEOLFZDVEHVHWE\SUREOHPVIURPWKHEHJLQQLQJ$OWKRXJKWKH -DFRELQV KDG EHHQ VXFFHVVIXO LQ HVWDEOLVKLQJ WKHLU QHZ SROLWLFDO XWRSLDWKH\ZHUHDQHOLWHPLQRULW\7KHOD]]DURQLZHUHXQFRQYLQFHG E\ WKH QHZ UHJLPH DQG WKHUH ZHUH GLIILFXOWLHV LQ UDOO\LQJ WKH SURYLQFHV0RUHRYHUWKH)UHQFKLPSRVHGZDUUHSDUDWLRQVRQWKH 5HSXEOLF IXUWKHU DQWDJRQLVLQJ WKH FLW\ DQG HIIHFWLYHO\ UHQGHULQJ WKH QHZ JRYHUQPHQW XQDEOH WR LPSOHPHQW DQ\ DGPLQLVWUDWLYH RU OHJLVODWLYH SURJUDPPH 7KH LGHDOLVWLF 3DUWKHQRSHDQ 5HSXEOLF VXUYLYHGRQO\ILYHPRQWKV,QKLV+LVWRU\RIWKH1HDSROLWDQ5HYROXWLRQ

%285%211$3/(6

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

0XFKRIWKHURPDQFHRIWKHVKRUWOLYHG3DUWKHQRSHDQ5HSXEOLF LVDVVRFLDWHGZLWKWKHPDQ\KHURHVDQGPDUW\UVLWSURGXFHGDOORI ZKRPEHOLHYHGVRIHUYHQWO\LQWKHLUXWRSLDQLGHDOV7KHLOOXVWULRXV YLFWLPV LQFOXGHG 0DULR 3DJDQR WKH DXWKRU RI WKH 3DUWKHQRSHDQ FRQVWLWXWLRQ 'RPHQLFR &LULOOR WKH GRFWRU DQG ERWDQLVW )DWKHU )UDQFHVFR&RQIRUWLDQGWKHWZRWUDJLFKHURLQHVRIWKH5HYROXWLRQ (OHRQRUD )RQVHFD 3LPHQWHO DQG /XLVD 6DQIHOLFH7KH 5HSXEOLFDQV ZKR ZHUH SXW WR GHDWK LPSULVRQHG DQG H[LOHG IRU WKHLU SDUW LQ HVWDEOLVKLQJ WKH 5HSXEOLF ZHUH JHQWOHPHQ JHQHUDOV DGPLUDOV ZULWHUV SRHWV VFLHQWLVWV SKLORVRSKHUV DQG SURIHVVLRQDOV$PRQJ WKHPZHUHQDPHVIURPWKHPRVWUHVSHFWDEOH1HDSROLWDQIDPLOLHV 7KHLU VDFULILFHV DUH FRPPHPRUDWHG ZLWK D PRQXPHQW LQ RQH RI 1DSOHV·PRVWHOHJDQWVTXDUHVWKH3LD]]DGHL0DUWLUL (OHRQRUD )RQVHFD 3LPHQWHO ZDV DQ XQOLNHO\ UHYROXWLRQDU\ $ QREOHZRPDQ RI 3RUWXJXHVH GHVFHQW VKH ZDV ZHOO WUDYHOOHG ZHOO HGXFDWHG DQG YHU\ ZHOO FRQQHFWHG (OHRQRUD ZDV DFWLYH LQ WKH

,17+(6+$'2:2)9(689,86

OLWHUDU\VDORQVRIWKHGD\LQ1DSOHVZKHUHVKHHQMR\HGGLVFXVVLQJ OLWHUDWXUHSKLORVRSK\SROLWLFVDQGVFLHQFH$WMXVW\HDUVRIDJH (OHRQRUD·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²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·VOHDGDUWLFOHLQWKH 0RQLWRUH·V ILUVWLVVXHEHJDQ¶:HDUHIUHHDWODVWDQGWKHWLPHKDVFRPHZKHQ

%285%211$3/(6

ZHWRRFDQXWWHUWKHVDFUHGZRUGV´/LEHUW\µDQG´(TXDOLW\µ·)URP )HEUXDU\ WKURXJK WR $XJXVW VKH ZURWH DQG SXEOLVKHG RYHU LVVXHVRIWKH0RQLWRUH,QWKHVSULQJRIZKHQWKHSDWURQVDLQW·V OLTXHIDFWLRQZDVFRPSOHWHGUDSLGO\LQXQGHUWHQPLQXWHV(OHRQRUD UHMRLFHG¶(YHQ 6DQ *HQQDUR KDV VKRZHG KLPVHOI D -DFRELQ· +HU HXSKRULDZRXOGEHVKRUWOLYHG ,VRODWHG IURP KLV IDYRXULWH KXQWLQJ JURXQGV WKH H[LOHG .LQJ )HUGLQDQGZDVILQDOO\WDNLQJDQLQWHUHVWLQSROLWLFVDQGSORWWHGWRWDNH EDFNKLVNLQJGRPZLWKWKHDVVLVWDQFHRI&DUGLQDO5XIIRDZDUULRU FOHULFZKRUDLVHGDQDUP\IURPDPRQJWKH&DODEULDQSHDVDQWU\DV KHPDUFKHGQRUWKZDUGV5XIIRLVVXHGDURXVLQJSURFODPDWLRQWRWKH SHRSOHRIKLVRZQELUWKSODFH *RRG DQG FRXUDJHRXV &DODEULDQV:LOO \RX WROHUDWH WKHVH RXWUDJHV" 9DOLDQWVROGLHUVRIDQDUP\EHWUD\HGZLOO\RXOHDYHXQSXQLVKHGWKH WUHDFKHU\WKDW«KDVXVXUSHGWKHWKURQHRIRXUOHJLWLPDWHPRQDUFK" 1R , FDQ VHH WKDW \RX WUHPEOH ZLWK ULJKWHRXV LQGLJQDWLRQ DQG DUH HDJHUWRDYHQJHWKHRIIHQFHVPDGHWRUHOLJLRQNLQJDQGFRXQWU\

5XIIR·V &KULVWLDQ$UP\ RI WKH +RO\ )DLWK WKH 6DQIHGLVWL ZHUH ILHUFHO\ OR\DO WR WKH %RXUERQV DQG GHWHUPLQHG WR GULYH RXW WKH 5HSXEOLFDQV$WWKHVDPHWLPHWKH)UHQFKKDGSXOOHGPRVWRIWKHLU DUP\RXWRI1DSOHVDQGKHDGHGQRUWKOHDYLQJRQO\DWRNHQIRUFHLQ WKHFLW\$VWKH6DQIHGLVWLPDUFKHGQRUWKZDUGVWKHOD]]DURQLEHJDQ WRUHYROWDJDLQVWWKH5HSXEOLFDQV 8QGHU 1HOVRQ·V FRPPDQG %ULWLVK VKLSV EORFNDGHG WKH SRUW DV 5XIIRDQGKLVDUP\HQWHUHGWKHFLW\7KHFDUGLQDOQHJRWLDWHGZLWK WKHEHOHDJXHUHG5HSXEOLFDQVDQGRIIHUHGVDIHSDVVDJHLQH[FKDQJH IRUWKHLUVXUUHQGHU:LWKVFDQWUHJDUGIRUIDLUSOD\1HOVRQGRXEOH FURVVHG WKHP DFWLQJ RQ RUGHUV IURP WKH UR\DO IDPLO\ LQ 6LFLO\ WR KDYHDQXPEHURIWKH5HSXEOLFDQGHIHQGHUVDUUHVWHG7KHFDUGLQDO VWURQJO\ REMHFWHG KDYLQJ JLYHQ KLV ZRUG DV D &KULVWLDQ WKDW WKH

,17+(6+$'2:2)9(689,86

GHIHQGHUVRIWKHFLW\ZRXOGEHJUDQWHGVDIHSDVVDJHEXW1HOVRQZDV PRVWDGDPDQW'RPHQLFR&LPDURVDKDGEHFRPHDPHPEHURIWKH ¶7KHDWUHV&RPPLVVLRQ·RIWKH3DUWKHQRSHDQ5HSXEOLF+HFRPSRVHG WKHQHZQDWLRQDODQWKHPWRZRUGVE\/XLJL5RVVLZKLFKUHFHLYHGLWV ILUVWSHUIRUPDQFHEHQHDWKWKHIUHHGRPWUHHLQIURQWRIWKH1DWLRQDO IRUPHUO\5R\DO 3DODFHGXULQJDFHUHPRQ\LQZKLFKWKH%RXUERQ IODJZDVEXUQW$VSROLWLFDOHYHQWVUDSLGO\HYROYHG&LPDURVDVRXJKW WRJDLQIDYRXUZLWKWKHUHWXUQLQJ%RXUERQVE\TXLFNO\FRPSRVLQJD ¶&DQDWDWDWRFHOHEUDWHWKHDYLGO\DZDLWHGUHWXUQRI.LQJ)HUGLQDQG·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

%285%211$3/(6

H[SUHVVHG OLWWOH HPRWLRQ¶6OLJKW EUHH]H RYHUFDVW &RXUW 0DUWLDO FDOOHG)UDQFHVFR&DUDFFLRORMXGJHGVHQWHQFHGDQGKXQJ·$IWHUWKH H[HFXWLRQ&DUDFFLROR·VERG\ZDVVXQNLQWKHED\ZLWKSRXQG ZHLJKWVWLHGWRLWVOHJV,QDQHHULHWZLVWRIIDWHVRPHZHHNVODWHU ZKHQ.LQJ)HUGLQDQGZDVRQERDUGDVKLSLQWKHED\&DUDFFLROR·V EORDWHGFRUSVHDSSURDFKHGWKHVKLS7KHERG\KDGLQH[SOLFDEO\ULVHQ DQGIORDWHGZLWKWKHKHDY\ZHLJKWVDWWDFKHGWRWKHOHJVJLYLQJWKH LPSUHVVLRQWKDWWKHDGPLUDOZDVVWDQGLQJXSLQWKHZDWHUKLVKHDG EREELQJPHQDFLQJO\DERYHWKHZDYHV7KHVXSHUVWLWLRXVNLQJIHOWWKDW KHZDVUHFHLYLQJDQDGPRQLVKPHQWIURPEH\RQGWKHJUDYHDQGJDYH EHODWHGSHUPLVVLRQIRUWKHERG\WREHWDNHQRQVKRUHIRU&KULVWLDQ EXULDO7KH H[HFXWLRQ RI$GPLUDO &DUDFFLROR PXVW UHSUHVHQW WKH QDGLU RI 1HOVRQ·V FDUHHU DQG LQGHHG SURYRNHG KHDWHG GHEDWH LQ WKH+RXVHRI&RPPRQVLQ/RQGRQ,WLVDOOHJHGWKDWE\KLVDFWLRQV LQ1DSOHV1HOVRQORVWWKHULJKWWRDKHUR·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¶7

· DQH\HZLWQHVVWRWKHHYHQWVWKHPVHOYHVFRQFOXGLQJ ,KDYHEHHQFDUHIXOWRVXSSUHVVGXULQJWKHFRXUVHRIWKLVQDUUDWLYH DOOWKHPRUHJUXHVRPHGHWDLOV5REHVSLHUUHZKDWHYHUKLVIDXOWVKDV WKLVDWOHDVWWREHVDLGLQKLVIDYRXUKHGLGQRWFRXQWDPDMRULW\RI SHUVRQDOIULHQGVDPRQJWKHWRWDOQXPEHURIKLVYLFWLPV7KRVHZKRP KHVDFULILFHGKHVDFULILFHGWRDV\VWHPKRZHYHULOOIRXQGHGQRWWRKLV SHWW\SHUVRQDOVSLWH

,17+(6+$'2:2)9(689,86

0DQ\LOOXVLRQVZHUHVKDWWHUHGZLWKWKHGHPLVHRIWKHVKRUWOLYHG 5HSXEOLF3DOD]]R6HUUDGL&DVVDQRRQYLD0RQWHGL'LRZDVWKHKRPH RI*LRYDQQL6HUUDWKH'XNHRI&DVVDQRRQHRI(OHRQRUD)RQVHFD 3LPHQWDO·VFORVHVWIULHQGVFRQGHPQHGWRGHDWKE\WKH%RXUERQV 2QWKHGD\RIKLVH[HFXWLRQORRNLQJGRZQIURPWKHVFDIIROGDWWKH DVVHPEOHGFURZGRIYHQJHIXOOD]]DURQLKHZU\O\REVHUYHG¶,KDYH DOZD\V ZDQWHG JRRG IRU WKHP DQG QRZ WKH\ FKHHU DW P\ GHDWK· 7KHQH[WGD\6HUUD·VIDWKHUFORVHGWKHJUDQGPRQXPHQWDOSRUWDO RIWKHIDPLO\KRPH+HYRZHGWKDWWKHGRRUZRXOGUHPDLQFORVHG LQ SHUSHWXDO PRXUQLQJ XQWLO WKH LGHDOV KLV VRQ KDG GLHG IRU ZHUH UHDOLVHG(OHRQRUD·VH[HFXWLRQZDVVHWIRU$XJXVW6KHZDV FDOPDWWKHJDOORZVDQGLQNHHSLQJZLWKKHUOLWHUDU\QDWXUHKHUODVW ZRUGVZHUHDTXRWHIURP9LUJLO¶)RUVDQHWKDHFROLPPHQLQLVVHLXYDELW· ¶3HUKDSVRQHGD\WKLVZLOOEHZRUWKUHPHPEHULQJ· +HUERG\ZDV OHIWKDQJLQJIRUDIXOOGD\H[SRVHGWRMLEHVDQGKXPLOLDWLRQ 3HUKDSV WKH PRVW XQIRUWXQDWH YLFWLP RI WKH GHPLVH RI WKH 3DUWKHQRSHDQ 5HSXEOLF ZDV /XLVD 6DQIHOLFH D PLQRU DULVWRFUDW ZLWKQRLQWHUHVWZKDWVRHYHULQSROLWLFV/XLVDZDVDIULYRORXV\RXQJ ZRPDQ ZKR KDG PDGH DQ XQIRUWXQDWH PDUULDJH .LQJ )HUGLQDQG KLPVHOI LQWHUYHQHG LQ WKH FRXSOH·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·V IDWH DQG VKH ZDV GXO\ DUUHVWHG ZKHQWKH5HSXEOLFIHOO,QDGHVSHUDWHDWWHPSWWRVDYHKHUOLIHRUDW

%285%211$3/(6

OHDVWWREX\WLPHXQWLOIXUWKHUSROLWLFDOGHYHORSPHQWVPLJKWUHVFXH KHU/XLVDOLHGWRKHUSULVRQZDUGHUVLQIRUPLQJWKHPWKDWVKHZDV SUHJQDQW7KHVXEWHUIXJHFRQWLQXHGIRUVHYHUDOPRQWKVDQGHYRNHG JUHDWSLW\IURPDOOVWUDWDRI1HDSROLWDQVRFLHW\,QGHHGPRYHGE\ /XLVD·V SOLJKW ZKHQ WKH KHUHGLWDU\ SULQFHVV 0DULD &OHPHQWLQD JDYHELUWKWRDVRQVKHLQYRNHGKHUULJKWWRPDNHDVSHFLDOUHTXHVW IRU FOHPHQF\ WR KHU IDWKHULQODZ WKH NLQJ )HUGLQDQG UHPDLQHG LQWUDQVLJHQWDQGZKHQWKHGDWHIRU/XLVD·VFRQILQHPHQWGUHZQHDU WKHFKDUDGHFRXOGFRQWLQXHQRORQJHU/XLVDZDVWKHODVWPDUW\URI WKHUHYROXWLRQWREHH[HFXWHGLQ6HSWHPEHU )UHQFKSDUHQWKHVLV¦

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·VEURWKHU-RVHSKHQWHUHGWKHFLW\DVNLQJ DQGZDVPHWZLWKLQGLIIHUHQFHIURPDOOVHJPHQWVRIVRFLHW\-RVHSK·V WLPHLQ1DSOHVZDVDEULHISHULRGRISHDFHDQGVWDELOLW\IRUWKHFLW\ EXWKHVRRQOHIWVHQWE\KLVEURWKHUWR0DGULGWREH.LQJRI6SDLQ -RVHSKZDVUHSODFHGLQ1DSOHVZLWKGDVKLQJFDYDOU\RIILFHU-RDFKLP 0XUDW WKH KXVEDQG RI 1DSROHRQ·V JODPRURXV DQG FOHYHU VLVWHU &DUROLQH%RQDSDUWHZKRIDURXWVKRQHWKHLURWKHUVLVWHU3DXOLQH LQHYHU\ZD\6XFKZDV&DUROLQH·VEHDXW\WKDWVKHDFWHGDVDPRGHO IRU SDLQWHU -HDQ$XJXVWH ,QJUHV +LV UHFOLQLQJ SRUWUDLW /D JUDQGH

,17+(6+$'2:2)9(689,86

RGDOLVTXHLVVDLGWREHEDVHGRQKHUSHUKDSVWKHRQO\NQRZQQXGH LPDJHRID(XURSHDQTXHHQ 0XUDWJRYHUQHGDV.LQJRI1DSOHVIRU DOPRVWHLJKW\HDUVDQGOHIWPXFKPRUHRIDPDUNWKDQ-RVHSK 0XUDWERUQLQWRDKXPEOH)UHQFKIDPLO\DQGHOHYDWHGWKURXJKKLV PLOLWDU\VNLOODQGPDUULDJHWR1DSROHRQ·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·VHQWKXVLDVPIRU1DSOHVDQGWKH 1HDSROLWDQVPDGHKLPDPXFKORYHGPRQDUFKQRWZLWKVWDQGLQJKLV UHODWLYHO\EULHIUHLJQ 0PH GH 6WDsO WUDYHOOHG WR ,WDO\ GXULQJ WKH SHULRG RI )UHQFK KHJHPRQ\ZKHQDOOWKLQJV1HDSROLWDQZHUHYHU\PXFKLQYRJXH DQGVHWKHUQRYHO&RULQQHLQ,WDO\LQZKLFKVKHZURWH¶DV\RXGUDZ FORVHUWR1DSOHV\RXIHHODVHQVDWLRQRIZHOOEHLQJVRFRPSOHWH QDWXUH·VJUHDWORYHIRU\RXLQVXFKDZD\WKDWQRWKLQJFRXOGFKDQJH WKHSOHDVDQWIHHOLQJVWKDWWKLVFDXVHV\RX·7KHHUXSWLRQRI9HVXYLXV LQ VXPPHUDXWXPQ ZDV REVHUYHG E\ &KDWHDXEULDQG ZKR FRXUDJHRXVO\ FOLPEHG WKH YROFDQR LQ RUGHU WR REVHUYH WKH

%285%211$3/(6

SKHQRPHQRQXSFORVH2WKHU)UHQFKYLVLWRUVLQFOXGHGWKH0DUTXLV GH 6DGH ZKR VDWHG KLV DSSHWLWHV LQ HYHU\ ZD\ LPDJLQDEOH GXULQJ KLVVWD\DQG/DPDUWLQHZKRGUHZLQVSLUDWLRQIURPKLVVRMRXUQLQ 1DSOHVIRUGHOLFDWHDQGHYRFDWLYHYHUVHV 6XUODSODJHVRQRUHRODPHUGH6RUUHQWH 'pURXOHVHVIORWVEOHXVDX[SLHGVGHO·RUDQJHU ,OHVWSUqVGXVHQWLHUVRXVODKDLHRGRUDQWH 8QHSLHUUHSHWLWHpWURLWHLQGLIIpUHQWH $X[SDVGLVWUDLWVGHO·pWUDQJHU 2QWKHVRQRURXVEHDFKZKHUH6RUUHQWR·VVHDXQOHDVKHVLWVEOXHZDYHV DWWKHIRRWRIWKHRUDQJHJURYHWKHUHOLHVFORVHWRWKHSDWKXQGHUWKH SHUIXPHGKHGJHDOLWWOHVWRQHIODWLQGLIIHUHQWWRWKHGLVWUDFWHGVWHSV RIWKHIRUHLJQHU

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·VVHFRQGZLIH7KHLULQIDQWVRQWKH.LQJRI5RPHZDV WKXVRI%RXUERQGHVFHQW 'XULQJKLVUHLJQLQ1DSOHV0XUDW·VGHVWLQ\UHPDLQHGLQH[WULFDEO\ OLQNHG ZLWK WKDW RI KLV ZLIH·V IDPLO\ ,W UDQNOHG WKDW KLV SRZHUIXO EURWKHULQODZWUHDWHGKLPPRUHOLNHDVXEVHUYLHQWJRYHUQRUJHQHUDO WKDQDQLQGHSHQGHQWPRQDUFK0XUDW·VUHODWLRQVZLWK1DSROHRQJUHZ LQFUHDVLQJO\VWUDLQHGDQGKHEHJDQWRKDUERXUDPELWLRQVWREHFRPH WKHIXWXUHNLQJRIDXQLWHG,WDO\0XUDWTXLHWO\HQFRXUDJHGVHFUHW

,17+(6+$'2:2)9(689,86

VRFLHWLHVVXFKDVWKH&DUERQDULKRWEHGVRISDQ,WDOLDQQDWLRQDOLVP 7KH&DUERQDUL¶FRDOGHDOHUV· ZHUHJURXSVRIVHFUHWUHYROXWLRQDU\ VRFLHWLHVHVWDEOLVKHGWKURXJKRXWHDUO\QLQHWHHQWKFHQWXU\,WDO\7KH\ ZHUH RUJDQLVHG DORQJ WKH OLQHV RI IUHHPDVRQU\ EURNHQ LQWR VPDOO FHOOV VFDWWHUHG DFURVV WKH FRXQWU\ ,GHDOLVWLFDOO\ WKH\ VRXJKW WKH FUHDWLRQRIDOLEHUDOXQLILHG,WDO\WKURXJKVSRQWDQHRXVUHEHOOLRQRI WKHSUROHWDULDWOHGE\XQLYHUVLW\VWXGHQWVDQGLQWHOOHFWXDOV,QVSLWHRI 0XUDW·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·VWURRSVLQ 0LOLWDU\ IRUWLILFDWLRQV IURP WKH SHULRG DUH VWLOO YLVLEOH 'HVSLWH WKLVVPDOO\HWVLJQLILFDQWYLFWRU\0XUDW·VIRUWXQHVEHJDQWRIDOWHU ZLWK1DSROHRQ·VGHIHDWDQGH[LOH,QWKH&RQJUHVVRI9LHQQD UHFRJQLVHG)HUGLQDQGDVWKHULJKWIXO.LQJRIWKH7ZR6LFLOLHV0XUDW·V DUP\ ZDV GHIHDWHG E\ WKH$XVWULDQV DW7ROHQWLQR ,Q D GHVSHUDWH DWWHPSWWRVDYHWKHVLWXDWLRQ0XUDWUHWUHDWHGWR3HVFDUDZKHUHKH LVVXHGDOLEHUDOFRQVWLWXWLRQDQGWKHQKHDGHGIRUVDIHW\RQ)UHQFK WHUULWRU\ LQ &RUVLFD +H WKHQ PDGH RQH ILQDO DWWHPSW WR UHWXUQ IURPH[LOHDQGUDLVHDQDUP\WRUHWDNHKLVNLQJGRP7KHVWDNHVZHUH KLJKDQGWKHH[.LQJRI1DSOHVORVW$FFRPSDQLHGE\DWLQ\EDQGRI VXSSRUWHUV0XUDWDWWHPSWHGDODQGLQJLQWKHVPDOOFRDVWDOWRZQRI

%285%211$3/(6

3L]]RLQ&DODEULD+HPDUFKHGLQWRWKHPDUNHWSODFHZLWKKLVHVFRUW ZKRVKRXWHG¶/RQJOLYHRXUNLQJ*LRDFFKLQR·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

%RXUERQ5HVWRUDWLRQ¦

$IWHUWKHUHVWRUDWLRQLQWKHIRUPHU.LQJ)HUGLQDQG,9RIWKH +RXVHRI%RXUERQUHWXUQHGDV)HUGLQDQG,RIWKH7ZR6LFLOLHVWR 1DSOHVZKHUH$XVWULDQWURRSVZHUHVWDWLRQHGWRSURWHFWWKHVWDELOLW\ RIWKHPRQDUFK\LQDFFRUGDQFHZLWKWKH7UHDW\RI&DVDODQ]D$JUHDW GHDOKDGFKDQJHGIROORZLQJWKH3DUWKHQRSHDQ5HYROXWLRQDQGWKH

,17+(6+$'2:2)9(689,86

1DSROHRQLFGRPLQDWLRQRI1DSOHV4XHHQ0DULD&DUROLQDUDYDJHG E\JULHIIRUKHUVLVWHUGHELOLWDWHGE\FRQVWDQWSUHJQDQFLHVWKURXJKRXW KHUORQJPDUULDJHDQGGHSUHVVHGRYHUWKHVDGORVVRIKHUNLQJGRP KDGGLHGLQH[LOH,QQRWLPHDWDOOKHUKXVEDQGKDGDQHZFRQVRUW 7ZR PRQWKV DIWHU WKH GHDWK RI KLV ZLIH )HUGLQDQG FRQWUDFWHG D PRUJDQDWLFPDUULDJHZLWKD6LFLOLDQDULVWRFUDW/XFLD0LJOLDFFLRWKH ZLGRZHG'XFKHVVRI)ORULGLDQDZKRKDGEHHQKLVORYHUIRUVRPH WLPH7KHKHUHGLWDU\SULQFHZDVDJKDVWDWWKLVDIIURQWWRKLVPRWKHU·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·V EURWKHU &DUO WUDYHOOHG WR 1DSOHV WR QHJRWLDWH D ORDQ WR WKH %RXUERQ DGPLQLVWUDWLRQ %\ WKH PLG V KH KDG HVWDEOLVKHG D SHUPDQHQW EDQNLQJ KRXVH LQ 1DSOHV:KHQ WKH 5H /D]]DURQHGLHGLQDIWHURQHRIWKHORQJHVWUHLJQVH[FOXGLQJ

%285%211$3/(6

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¶, GRQ·W NQRZZKDWLVPHDQWE\DQLQGHSHQGHQW,WDO\²,RQO\XQGHUVWDQGDQ LQGHSHQGHQW1DSOHV·DQG¶0\NLQJGRPVWDUWVDWVHDZDWHUDQGHQGV DWKRO\ZDWHU·LQUHIHUHQFHWRWKH.LQJGRP·VQRUWKHUQERUGHUZLWK WKH3DSDO6WDWHV *HQHUDOUHYROXWLRQDQGFRQVWLWXWLRQDOJRYHUQPHQWVZHSW(XURSH LQ .LQJ )HUGLQDQG ,, OLNH KLV JUDQGIDWKHU DQG QDPHVDNH EHIRUH KLP ZDV IRUFHG E\ WKH &DUERQDUL WR JUDQW D FRQVWLWXWLRQ EXWKHVRRQVTXDEEOHGZLWKQHZO\HOHFWHGPHPEHUVRISDUOLDPHQW RYHU WKH RDWK RI DOOHJLDQFH WR EH WDNHQ XSRQ WKH FRQYRFDWLRQ RI WKHILUVWSDUOLDPHQW(YHUPRUHH[FLWHGE\UHSRUWVRIWKHTXDUUHO WKHFDSLWDO·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

,17+(6+$'2:2)9(689,86

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·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

%285%211$3/(6

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·V ,O VRJQR GL SDUWHQRSH 3DUWKHQRSH·V 'UHDP IRUWKHVHFRQGLQDXJXUDWLRQDQGZDVVXLWDEO\LPSUHVVHG 7KHJUHDWGD\KDVDUULYHGDWODVWWKHRSHQLQJGD\RIWKH6DQ&DUOR 0DGQHVVWKURQJVRISHRSOHDXGLWRULXPDEOD]H,WLVQHFHVVDU\WRJLYH DQGWDNHSXQFKHVQRWWRPHQWLRQURXJKVKRYLQJ«,QLWLDOO\,EHOLHYHG P\VHOIWUDQVSRUWHGWRWKHSDODFHRIVRPH(DVWHUQHPSHURUP\H\HVDUH DEOD]HDQGP\VRXOLQHFVWDV\1RWKLQJPRUHVKLQLQJDQG\HWQRWKLQJ PRUH PDMHVWLF WZR WKLQJV WKDW DUH QRW HDV\ WR EULQJ WRJHWKHU7KLV RSHQLQJGD\RIWKH6DQ&DUORLVRQHRIWKHPDLQUHDVRQVRIP\YLVLW XQLTXHIRUPHDQGP\H[SHFWDWLRQVZHUHUHZDUGHG1RWKLQJHOVHLQ (XURSHDSSURDFKHVRUHYHQJLYHVWKHUHPRWHVWSLFWXUHRIWKLV

'XULQJWKHILUVWKDOIRIWKHQLQHWHHQWKFHQWXU\WKH6DQ&DUOR·V IDPHZDVLQH[WULFDEO\OLQNHGZLWKWKHPDQ$OH[DQGUH'XPDVSqUH GHVFULEHG DV¶WKH SULQFH RI LPSUHVDULRV· ² 'RPHQLFR %DUEDMD ,Q DQ HIIRUW WR UHYLYH WKH WKHDWUH·V IRUWXQHV DIWHU WKH WUDJLF ILUH KH HPSOR\HG*LRDFKLQR5RVVLQLRI3HVDURDVDUWLVWLFGLUHFWRUDSRVWKH KHOGIRUVHYHQ\HDUVFRPSRVLQJQXPHURXVRSHUDVVSHFLILFDOO\IRU WKHWKHDWUHDQGLWVVLQJHUV'XULQJKLVWLPHLQ1DSOHV5RVVLQLZDVLQ KLVHOHPHQWDQGKHLQFRUSRUDWHGVHYHUDO1HDSROLWDQWKHPHVLQWRKLV PXVLF2QHRIKLVPRVWIDPRXVFRPSRVLWLRQV/DGDQ]DRU7DUDQWHOOD QDSROHWDQDIURPWKHVRQJFROOHFWLRQ6RLUpHV0XVLFDOHVIRUYRLFHDQG

,17+(6+$'2:2)9(689,86

SLDQRKDVEHFRPHDVWDSOHRIWKHWHQRUUHSHUWRU\,WLVRQHRIWKH PRVWGHOLJKWIXODQGFKDUPLQJSLHFHVRI1HDSROLWDQPXVLFDVHQVXDO DQGHYRFDWLYHGHVFULSWLRQRIWKHWDUDQWHOODGDQFH *LjODOXQDLQPH]]RDOPDUH PDPPDPLDVLVDOWHUj O·RUDqEHOODSHUGDQ]DUH FKLqLQDPRUQRQPDQFKHUj 3UHVWRLQGDQ]DDWRQGRDWRQGR GRQQHPLHYHQLWHTXj XQJDU]RQEHOORHJLRFRQGR DFLDVFXQDWRFFKHUj )LQFKpLQFLHOREULOODXQDVWHOOD HODOXQDVSOHQGHUj LOSLEHOFRQODSLEHOOD WXWWDODQRWWHGDQ]HUj 7KH PRRQ LV DOUHDG\ LQ WKH PLGGOH RI WKH VHD 0DPPD PLD ,W·V D EHDXWLIXOWLPHWRMXPSXSDQGGDQFH7KRVHLQORYHZLOOQRWPLVVRXW DVYHU\VRRQGDQFLQJURXQGDQGURXQGJLUOVGUDZQHDU²\RXZLOOHDFK GDQFHZLWKDEHDXWLIXOSOD\IXOER\7KHVWDUVDQGWKHPRRQZLOOVKLQHRQ WKHEHDXWLIXOER\VDQGJLUOVZKRGDQFHLQWKHFLUFOHDOOQLJKW

7KH VZLUOLQJ WULSOHWV RI WKLV YLUWXRXV SLHFH LQFUHDVH LQ HYHU LQWHQVLI\LQJ UK\WKP WR WKH FDWFK\ RQRPDWRSRHLF FKRUXV¶IULQFKp IULQFKp IULQFKp· ZKLFK HYRNHV WKH PDQGROLQ DFFRPSDQLPHQW WR WKHIUHQ]LHGGDQFHRIWKRVHELWWHQE\WKHWDUDQWXOD 5RVVLQLDEUXSWO\IOHG1DSOHVRQHQLJKWZLWKWKHVRSUDQR,VDEHOOD &ROEUDQ %DUEDMD·V ORYHU 7KH EURNHQKHDUWHG LPSUHVDULR WKUHZ KLPVHOI LQWR KLV ZRUN DQG VRRQ VLJQHG XS DQRWKHU ULVLQJ VWDU RI ,WDOLDQRSHUD*DHWDQR'RQL]HWWLZKRFRPSRVHGRSHUDVIRUWKH 6DQ&DUORLQFOXGLQJ/XFLDGL/DPPHUPRRU%DUEDMDKDGDQH[FHOOHQW H\HIRUWDOHQWDQGHQFRXUDJHGWKH\RXQJ9LQFHQ]R%HOOLQLWKHQD VWXGHQWDWWKH6DQ3LHWURD0DMHOODFRQVHUYDWRU\WRVWDJHKLVILUVW

%285%211$3/(6

RSHUD%LDQFDH%HUODQGRDWWKH6DQ&DUOR%RWK'RQL]HWWLDQG%HOOLQL ZHUHWRIROORZ5RVVLQL·VH[DPSOHDQGFRPSRVH1HDSROLWDQVRQJVDV ZHOODVWKHLURSHUDV7KHQLQHWHHQWKFHQWXU\ZDVWKHKH\GD\RIWKH 1HDSROLWDQVRQJWUDGLWLRQ7KH3LHGLJURWWD)HVWLYDOLQLWLDOO\DSXUHO\ UHOLJLRXVRFFDVLRQZLWKPLOLWDU\SDUDGHVDQGILUHZRUNVGHYHORSHG LQWRDVRQJIHVWLYDOIURP'RQL]HWWL·VFKDUPLQJ 7LYRJOLREHQH DVVDL,ORYH\RXVRYHU\PXFK ZKLFKLQRQH\HDUVROGFRSLHV LQVKHHWPXVLFZDVWKHILUVWELJVXFFHVVWRFRPHRXWRIWKHVRQJ IHVWLYDOSURPSWLQJ/XLJL6HWWHPEULQLLQKLVPHPRLUVWRVWDWHZLWK UHJDUGWRWKH\HDU¶WKHUHZHUHWKUHHKLJKOLJKWVWRWKH\HDU WKHUDLOZD\JDVLOOXPLQDWLRQDQG7HYRJOLREHQHDVVDL·7KHFKRUXVWR ZRUGVE\5DIIDHOH6DFFRLVDWLPHOHVVHYRFDWLRQRIXQUHTXLWHGORYH ¶7HYRJOLREHQHDVVDLHWXQRQSLHQVHDPH·¶,ORYH\RXVRYHU\PXFKDQG \RXGRQ·WHYHQWKLQNRIPH·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

,17+(6+$'2:2)9(689,86

7KHVHDUHNQRZQDVJRXDFKHVDQGXVXDOO\GHSLFWHG1HDSROLWDQVFHQHV DQGODQGVFDSHV7KHPDUYHOVRIQDWXUHLQ1DSOHVDQG&DPSDQLDZHUH DQRWKHUIDYRXULWHWKHPHRIWKH6FKRRORI3RVLOOLSR7KHWZRSULQFLSDO H[SRQHQWVRIWKHVFKRROWKH'XWFKDUWLVW$QWRRQ6PLQFN3LWORRDQG WKH 1HDSROLWDQ *LDFLQWR *LJDQWH GHSLFWHG WKH VSOHQGLG VLJKWV RI WKHWUDGLWLRQDO WRXULVW LWLQHUDU\ ZLWK GD]]OLQJ H[SUHVVLYLW\ EDWKHG LQVHQWLPHQWDOVXQOLJKW7KH9LFWRULDQDUWKLVWRULDQ/RUG1DSLHULQ KLV1RWHVRQ0RGHUQ3DLQWLQJDW1DSOHVHQWKXVHGWKDW¶LIWKHVSHFWDFOH DQGLPSUHVVLRQVRIEHDXWLIXOVFHQHU\ZHUHDORQHVXIILFLHQWWRIRUP DJUHDWVFKRRORIODQGVFDSHSDLQWLQJWKDWEUDQFKRIWKHDUWZRXOG KDYH EHHQ QRZKHUH SHUSHWXDWHG LQ D KLJKHU GHJUHH RI SHUIHFWLRQ WKDQDW1DSOHV·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·VLQWHQVHSDVVLRQIRUWKHFLW\·VHQFKDQWLQJEHDXW\EXWDOVR DQH[SUHVVLRQRIKLVHQWKXVLDVPIRUWKHQHZFRQVWLWXWLRQRQO\MXVW SURPXOJDWHGE\WKHHOGHUO\NLQJ 1DSOHV7KRX+HDUWRIPHQZKLFKHYHUSDQWHVW

%285%211$3/(6

1DNHGEHQHDWKWKHOLGOHVVH\HRI+HDYHQ (O\VLDQ&LW\ZKLFKWRFDOPHQFKDQWHVW 7KHPXWLQRXVDLUDQGVHD7KH\URXQGWKHHHYHQ $VVOHHSURXQG/RYHDUHGULYHQ 0HWURSROLVRIDUXLQHG3DUDGLVH /RQJORVWODWHZRQDQG\HWEXWKDOIUHJDLQHG

6KHOOH\ZDVDOVRLQVSLUHGWRFRPSRVHWKH6WDQ]DV:ULWWHQLQ'HMHFWLRQ QHDU 1DSOHV LQ ZKLFK KLV HPRWLRQV ILQG WKHLU UHIOHFWLRQ LQ WKH ORFDO ODQGVFDSH 6KHOOH\·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²9HVXYLXVWKHH[WHUPLQDWRU ²DQGPDQ·VIXWLOHVWUXJJOHDJDLQVWWKHIRUFHVRIQDWXUH 7HPXWREROORUFKHVLULYHUVD GDOO·LQHVDXVWRJUHPER VXO·DUHQRVRGRUVRDFXLULOXFH GL&DSULODPDULQD HGL1DSROLLOSRUWRH0HUJHOOLQD )HDUHG ODYD ZKLFK SRXUV RXW IURP WKH GHHS YROFDQLF GHSWKV RQWR WKH ED\ ZKHUH WKH OLJKWV RI &DSUL·V PDULQD WKH SRUW RI 1DSOHV DQG 0HUJHOOLQDDOOVKLQH

7KHKDUG\EURRPSODQWLVDKXPEOHIORZHUZLWKDVKRUWOLIHVSDQEXW LWVVZHHWSHUIXPHLVFRPSDUDEOHWRWKHSXUHVWSRHWU\SURGXFHGE\ WKHKXPDQVSLULW/HRSDUGLGLHGSUHPDWXUHO\DWDJHDQGLVEXULHG

,17+(6+$'2:2)9(689,86

WRGD\QH[WWR9LUJLO·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

&KDUOHV'LFNHQVZDVWDNHQE\WKHYLEUDQF\RIWKHVWUHHWOLIHLQ 1DSOHVEXWKHZDVPRUHDZDUHWKDQ*RHWKHRIZKDWOD\EHQHDWKDQG DGPRQLVKHG WKRVH YLVLWRUV ZKR GLVUHJDUGHG WKH VRFLDO GLIILFXOWLHV RIWKHFLW\·VSRRU¶%XWORYHUVDQGKXQWHUVRIWKHSLFWXUHVTXHOHW XV QRW NHHS WRR VWXGLRXVO\ RXW RI YLHZ WKH PLVHUDEOH GHSUDYLW\ GHJUDGDWLRQ DQG ZUHWFKHGQHVV ZLWK ZKLFK WKLV JD\ 1HDSROLWDQ OLIHLVLQVHSDUDEO\DVVRFLDWHG·:HNQRZWKDWWKH%URWKHUV*ULPP YLVLWHG1DSOHVDQGLWPD\EHWKDWGXULQJWKHLUVWD\LQWKHFLW\WKH\ ILUVW FDPH LQWR FRQWDFW ZLWK %DVLOH·V3HQWDPHURQH ZKLFK VHUYHG DV VXFK DQ LQVSLUDWLRQ WR WKHLU RZQ IDLU\ WDOHV7KH FKDVWH +DQV &KULVWLDQ$QGHUVHQDOVRYLVLWHG1DSOHVDQGZDVVRWHPSWHGE\WKH VHQVXRXV GHOLJKWV DYDLODEOH WKDW KH IHOW KLV RZQ EORRG WR EH FORVH WREXEEOLQJRYHUOLNHWKDWRI6DQ*HQQDUR$OWKRXJKKHZDVDEOHWR UHWXUQWR&RSHQKDJHQZLWKKLVYLUWXHLQWDFW$QGHUVRQGLGUHTXHVW SHUPLVVLRQIURPWKHGLUHFWRURIWKHDUFKDHRORJLFDOPXVHXPWRYLHZ WKHFROOHFWLRQRI5RPDQHURWLFDXVXDOO\NHSWXQGHUORFNDQGNH\

%285%211$3/(6

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

1DSOHVZDVLQFUHDVLQJO\IUHTXHQWHGE\WKHVZHOOLQJUDQNVRIPLGGOH FODVV WUDYHOOHUV ZKR ZHUH DWWUDFWHG E\ WKH VDPH QDWXUDO EHDXW\ DQG URPDQWLF ODQGVFDSHV (GZDUG %XOZHU/\WWRQ UHFRQVWUXFWHG WKH HYHQWV RI WKH /DVW 'D\V RI 3RPSHLL DQG WKH SXEOLFDWLRQ RI KLV ILFWLRQDODFFRXQWLQLQVSLUHGFRXQWOHVVWUDYHOOHUVWRYLVLWWKH DUFKDHRORJLFDO GLJV7KH JURWWD D]]XUUD RQ &DSUL ZDV¶GLVFRYHUHG·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jGL9HQH]LD

,17+(6+$'2:2)9(689,86

IRUWKH9HQHWLDQVZKRZHUHVWLOOFRQVLGHUHGIRUHLJQHUV 7KHILUVW GHWDLOHGORFDOJXLGH$+DQGERRNIRU7UDYHOOHUVWR6RXWKHUQ,WDO\ ZDVSXEOLVKHGLQ(QJOLVKE\6LU)UDQFLV3DOJUDYHDVDVXSSOHPHQWWR %DHGHNHUDQG/DG\%OHVVLQJWRQ·VEUHDWKOHVVDFFRXQWVRIWKHZRQGHUV RI1HDSROLWDQOLIHZHUHZLGHO\UHDGLQ%ULWDLQFRQWULEXWLQJIXUWKHU WRWKHFLW\·VIDPHDVDWUDYHOGHVWLQDWLRQ7KRXVDQGVDUULYHGLQ1DSOHV SURPSWLQJ%\URQWRZULWHLQ7KH$JHRI%URQ]HWKDW¶9HVXYLXVVKRZV KLV EOD]H DQ XVXDO VLJKW)RU JDSLQJ WRXULVWV IURP KLV KDFNQH\·G KHLJKW·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«,QWKH.LQJGRP RIWKH7ZR6LFLOLHVLQWKHFRXQWU\ZKLFKLVVDLGWREHWKHJDUGHQRI (XURSHWKHSHRSOHGLHRIKXQJHUDUHLQDVWDWHZRUVHWKDQEHDVWVDQG WKHRQO\ODZLVFDSULFH«

(QWUHQFKHG LQ KLV DEVROXWLVW DQG LVRODWLRQLVW ZD\V 5H %RPED KDG GHQLHG 6RXWKHUQ ,WDO\ WKH RSSRUWXQLW\ WR SDUWLFLSDWH LQ WKH PRYHPHQWIRU,WDOLDQXQLILFDWLRQ:KHQKHGLHGLQ0D\IHZ WHDUVZHUHVKHGDQGKHZDVVXFFHHGHGE\KLV\RXQJVRQ)UDQFLV,,

%285%211$3/(6

WKHODVW.LQJRI1DSOHV,Q-XQHWKHQHZNLQJEHODWHGO\JUDQWHG WKHFRQVWLWXWLRQZKLFKKLVIDWKHUDQGJUHDWJUDQGIDWKHUKDGUHVLVWHG 5LVRUJLPHQWR

7KHIDOORIWKH+RXVHRI%RXUERQPXVWEHXQGHUVWRRGZLWKLQWKH IUDPHZRUNRIWKH5LVRUJLPHQWRWKHPRYHPHQWWRXQLWH,WDO\LQWRD VLQJOHQDWLRQ%\WKHWLPH)UDQFLV,,SURPXOJDWHGWKHORQJDZDLWHG FRQVWLWXWLRQ KLV GD\V ZHUH DOUHDG\ QXPEHUHG7KH VZDVKEXFNOLQJ SDWULRW *LXVHSSH *DULEDOGL KDG DVVHPEOHG D JURXS RI ,WDOLDQ QDWLRQDOLVWVWRODQGLQ6LFLO\DQGPDUFKQRUWKWR1DSOHVDORQJWKH VDPHURXWHDV&DUGLQDO5XVVRDQGKLV$UP\RIWKH+RO\)DLWKWZR JHQHUDWLRQV HDUOLHU ZLWK WKH LQWHQWLRQ RI WDNLQJ WKH FDSLWDO DQG XQLWLQJWKH.LQJGRPRIWKH7ZR6LFLOLHVZLWKWKHQHZO\HVWDEOLVKHG .LQJGRPRI1RUWKHUQ,WDO\UXOHGE\.LQJ9LFWRU(PPDQXHORIWKH 6DYR\G\QDVW\,QLWLDOO\RQHRIWKHPRVWLPSRUWDQWGLSORPDWLFDOOLHV RI1DSOHVVLQFHWKH%RXUERQ5HVWRUDWLRQLQWKH%ULWLVKKDG EHFRPHRQHRIWKHLUKDUVKHVWFULWLFVWKH\ZHUHPRUHV\PSDWKHWLF ZLWKWKHOLEHUDOLGHDOVRIWKH5LVRUJLPHQWRDQGWKXVGLIILGHQWDQGFULWLFDO ZLWKUHJDUGWRWKHUHDFWLRQDU\%RXUERQJRYHUQPHQW6RPH%ULWLVK UHVLGHQWVHYHQJDYHDFWLYHVXSSRUWWRWKHOLEHUDOV$PRQJWKHPWKH MRXUQDOLVW +HQU\:UHIRUG QRW RQO\ GHIHQGHG WKH (QJOLVK SRVLWLRQ RQWKH5LVRUJLPHQWRLQWKH%ULWLVKSUHVVEXWZDVDFWLYHLQVXEYHUVLYH PLVVLRQV7KH VLWXDWLRQ FXOPLQDWHG LQ IROORZLQJ *DULEDOGL·V ODQGLQJLQ6LFLO\$ODUJHQXPEHURIWKH%ULWLVKUHVLGHQWVLQ1DSOHV DFWXDOO\ EHJDQ WR PDUFK WRZDUGV 6LFLO\ WR PHHW XS ZLWK WKH 5HG 6KLUWVRI*DULEDOGL·VUDJWDJDUP\-RLQLQJWKHPZDVWKHFRXUDJHRXV ZULWHUDQGDFWLYLVW-HVVLH0DULR:KLWHPDUULHGWRDQ,WDOLDQZKR ZLWKWKHDVVLVWDQFHRIVRPHRWKHUZRPHQIURPWKH%ULWLVKFRORQ\ FUHDWHGDILHOGKRVSLWDOWRORRNDIWHUWKRVHLQMXUHGLQEDWWOH :LWKPHQ*DULEDOGLFURVVHGIURP6LFLO\WR&DODEULDDQG EHJDQ WR DSSURDFK 1DSOHV *LYHQ WKH VWUHQJWK RI WKH %RXUERQ

,17+(6+$'2:2)9(689,86

DUP\LWZDVDQDPD]LQJIHDWDOWKRXJKLWLVEHOLHYHGWKDWWKHHDUOLHVW RUJDQLVHG FULPH V\QGLFDWHV LQ 6RXWKHUQ ,WDO\ SDYHG WKH ZD\ IRU *DULEDOGL·VDGYDQFHLQWKHVDPHZD\WKDWDOPRVWDFHQWXU\ODWHU WKH\DVVLVWHGWKHDGYDQFHRIWKH$PHULFDQ)LIWK$UP\DORQJWKHVDPH URXWH7KHUH ZDV PDVVLYH GHVHUWLRQ DPRQJ UR\DOLVW WURRSV PDQ\ RIZKRPUHDOLVHGWKDWWKH\ZHUHQRZGHIHQGLQJDORVWFDXVH.LQJ )UDQFLVIOHGWR*DHWDZLWK4XHHQ0DULD6RSKLDVLVWHURI(PSUHVV (OL]DEHWKRI$XVWULDWKHWUDJLF6LVVL DQGLVVXHGWKHIROORZLQJPRYLQJ DQGQREOHSURFODPDWLRQWRKLVVXEMHFWV $VDGHVFHQGDQWRIDG\QDVW\ZKLFKKDVUHLJQHGRYHUWKLVFRXQWU\IRU RQHKXQGUHGDQGWZHQW\VL[\HDUVP\DIIHFWLRQVDUHFHQWUHGKHUH,DP D1HDSROLWDQDQGFDQQRWZLWKRXWIHHOLQJVRIELWWHUJULHIVSHDNZRUGV RIIDUHZHOOWRP\GHDUO\EHORYHGSHRSOH:KDWHYHUPD\EHP\GHVWLQ\ SURVSHURXVRUFRQWUDU\,VKDOODOZD\VSUHVHUYHIRUWKHPDODVWLQJDQG DIIHFWLRQDWHUHPHPEUDQFH,UHFRPPHQGWRWKHPFRQFRUGDQGSHDFH DQGWKHREVHUYDQFHRIWKHLUFLYLFGXWLHV'RQRWOHWDQLPPRGHUDWH ]HDOIRUP\IDWHEHPDGHDSUHWH[WIRUGLVRUGHU

2Q 6HSWHPEHU *LXVHSSH *DULEDOGL DQG D VPDOO JURXS RI 5HG 6KLUWV HQWHUHG 1DSOHV XQRSSRVHG DUULYLQJ E\ WUDLQ IURP 6DOHUQRDQGWKHQLQDQRSHQFDUULDJHIURPWKHVWDWLRQWRWKH5R\DO 3DODFH$JURXSRIJHQWOHPHQXQIXUOHGDEDQQHUEHDULQJWKHFRDW RIDUPVRIWKH.LQJRI6DYR\DQGDOODORQJYLD7ROHGRVKRSZLQGRZV ZHUHGHFRUDWHGZLWKWKHUHGFURVVRIWKH6DYR\*DULEDOGLUHFHLYHG DKHUR·VZHOFRPH7KH)UHQFKQRYHOLVW$OH[DQGUH'XPDV SqUHKDG EHHQDQDFWLYHVXSSRUWHURI*DULEDOGLWKURXJKRXWKLVFDPSDLJQDQG ZDVZLWQHVVWRKLVH[XEHUDQWUHFHSWLRQ 7KHZKROHRI1DSOHVIROORZHGKLPIURPWKHVHDIURQWWRWKHFDWKHGUDO DQGIURPWKHFDWKHGUDOWRWKHSDODFH$QLPPHQVHVKRXWZKLFKVRXQGHG DVLIIURPWKHWKURDWVRIILYHKXQGUHGWKRXVDQGLQKDELWDQWVRI1DSOHV EXUVW IRUWK WRZDUG KHDYHQ ² LW ZDV WKH K\PQ RI YHQJHDQFH DJDLQVW

%285%211$3/(6

)UDQFLV ,, LW ZDV WKH KRVDQQD RI JUDWLWXGH IRU WKH OLEHUDWRU¶(YYLYD *DULEDOGL·7KHJHQHUDOZDVIRUFHGWRVKRZKLPVHOIDWWKHZLQGRZ7KH VKRXWVWKHQUHGRXEOHGKDWVDQGERXTXHWVZHUHWKURZQLQWRWKHDLU$W HYHU\ZLQGRZORRNLQJRQWKHSDODFHWKHZRPHQZDYHGKDQGNHUFKLHIV OHDQLQJRXWDWWKHULVNRIIDOOLQJLQWRWKHVWUHHWV7KHUHYROXWLRQZDV DFFRPSOLVKHG DQG DV , KDG SURPLVHG *DULEDOGL ZLWKRXW VKHGGLQJ D GURSRIEORRG

:KHQWKHQRUWKHUQDQGVRXWKHUQWURRSVPHWQRUWKRI1DSOHV *DULEDOGLKDLOHG.LQJ9LFWRU(PDQXHOZLWKWKHZRUGV¶*UHHWLQJV WRWKHILUVW.LQJRI,WDO\·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

,17+(6+$'2:2)9(689,86

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

&+$37(5),9(

, 7 $ / , $ 1 1 $3/(6

7KH1LQHWHHQWK& HQWXU\

7

KHSOHELVFLWHKHOGLQWRUDWLI\WKHDPDOJDPDWLRQRIZKDW KDG EHHQ WKH .LQJGRP RI WKH 7ZR 6LFLOLHV LQWR WKH XQLILHG .LQJGRPRI,WDO\FKDQJHGWKHVWDWXVRI1DSOHVIRUHYHU7KHFLW\ORVW LWVSULYLOHJHGSRVLWLRQDVDUR\DOFDSLWDO$WWKHWLPHRIXQLILFDWLRQ 1DSOHVKDGEHHQWKHPRVWSRSXORXVFLW\LQ,WDO\ZLWKDSSUR[LPDWHO\ LQKDELWDQWV DQG WKH IRXUWK ODUJHVW FLW\ LQ (XURSH DIWHU /RQGRQ3DULV DQG9LHQQD :LWK WKHVXSSUHVVLRQ RI WKH %RXUERQ FRXUW DQG JRYHUQPHQW EXUHDXFUDF\ WHQV RI WKRXVDQGV RI MREV GLVDSSHDUHGWRJHWKHUZLWKWKHFLW\·VDXWKRULW\WRH[WUDFWZHDOWKIURP WKHFRXQWU\VLGHWKURXJKWD[DWLRQ$WWKHWLPHRIWKH5LVRUJLPHQWR WKH.LQJGRPRIWKH7ZR6LFLOLHVKDGWKHEHVWSXEOLFILQDQFHVLQ,WDO\ DQGPRUHFRPPHUFLDOWRQQDJHSDVVHGWKURXJKLWVSRUWWKDQWKURXJK DQ\RWKHULQ,WDO\8QIRUWXQDWHO\,WDOLDQDWWLWXGHVWR1DSOHVZHUH FRORXUHGE\GLVWUXVWDQGVXVSLFLRQRIWKHVRXWKHUQHUV/XLJL)DULQL WKHFLW\·VILUVWFLYLOLDQJRYHUQRUZURWHLQ¶,WLVDJRRGWKLQJ WKDWWKH'HSXWLHVZKRKDYHFRPHKHUHIURP,WDOLDQ,WDO\ZLOOKDYH VHHQZKDWDKHOOSLW1DSOHVLV,WZLOOHQDEOHWKHPWREHIDLUWRXV

,17+(6+$'2:2)9(689,86

LIZHIDLOWRWXUQVZLQHLQWRKHURHV7KHUHLVDWOHDVWWKLVWREHVDLG WKLQJV FDQQRW JHW DQ\ ZRUVH·7KH HODWLRQ DQG HXSKRULD WKDW KDG DFFRPSDQLHG*DULEDOGL·VWULXPSKDQWDUULYDOLQ1DSOHVZDVUDSLGO\ UHSODFHGE\ELWWHUQHVVDQGUHVHQWPHQW*DULEDOGLKLPVHOIZDVODWHU WRUHIOHFW¶7KHRXWUDJHVVXIIHUHGE\WKHSHRSOHRI6RXWKHUQ,WDO\ FDQQRWEHTXDQWLILHG,DPFRQYLQFHGWKDW,GLGQRWKLQJZURQJEXW GHVSLWHWKDWWRGD\,ZRXOGQRWWDNHWKHVDPHURXWHLQ6RXWKHUQ,WDO\ DV,ZRXOGIHDUWKDW,ZRXOGEHDWWDFNHGE\VWRQHVEHFDXVHWKHUHVXOW ZDVRQO\VTXDORUDQGKDWUHG·7KHRSHQLQJRIWKH0LODQ$QFRQD%DUL /HFFHWUDLQOLQHLVRODWHG1DSOHVIURPWKHPDUNHWVRI1RUWKHUQ,WDO\ 7KH IRXQGDWLRQV RI WKH ORFDO DJULFXOWXUDO V\VWHP ZHUH GHVWUR\HG WKH FLW\·V WH[WLOH DQG HQJLQHHULQJ LQGXVWULHV FROODSVHG DQG PDQ\ UHWDLOVKRSVFORVHG7KHUHZHUHGUDPDWLFSURWHVWVLQWKHFLW\ :LWK WKH FLW\·V UHVRXUFHV VR JUHDWO\ GLPLQLVKHG WKH 1HDSROLWDQ HFRQRP\ VWDJQDWHG 7ZHQW\ \HDUV DIWHU ,WDOLDQ XQLILFDWLRQ XQHPSOR\PHQW FULPH DQG RYHUFURZGLQJ KDG UHDFKHG WUDJLF SURSRUWLRQVDQGWKHLOOLWHUDF\UDWHZDVPRUHWKDQWZLFHWKDWRI7XULQ RU0LODQ$OPRVWDTXDUWHURIWKHFLW\·VSRSXODWLRQOLYHGLQDEMHFW SRYHUW\ DQG VTXDORU DQG PDQ\ VOHSW URXJK +RZHYHU KHLJKWHQHG VRFLDO DZDUHQHVV PHDQW WKDW WKH YRLFHV RI WKRVH FRQFHUQHG EHJDQ WR EH KHDUG7KH SXEOLFDWLRQ RI -HVVLH:KLWH 0DULR·V 7KH 'HVWLWXWH 3RRURI1DSOHVDQG5HQDWR)XFLQL·V 1DSROLDGRFFKLRQXGR1DSOHVWRWKH %DUH(\H UHYHDOHGWKHH[WHQWRIWKHSRSXODWLRQ·VVXIIHULQJLQJUDSKLF GHWDLO$IHZ\HDUVDIWHUJLYLQJKHUVXSSRUWWRWKH5LVRUJLPHQWRWKH (QJOLVKZRPDQ-HVVLH0DULR:KLWHZDVVKRFNHGDQGVDGGHQHGWRVHH KRZ1DSOHVKDGVXIIHUHGIROORZLQJXQLILFDWLRQ6KHVSHQWWLPHLQWKH FLW\UHVHDUFKLQJWKHKRUULILFVRFLDOFRQGLWLRQVFRPSLOLQJVWDWLVWLFVDQG PDNLQJQRWHVRQWKHJULPUHDOLWLHVRIOLIHLQWKH1HDSROLWDQVOXPVDQG DUULYHGDWDGLVWUHVVLQJ\HWDFFXUDWHSLFWXUHRIOLIHIRUPDQ\WKRXVDQGV RIWKHFLW\·VSRRU+HUYLHZVZHUHHFKRHGE\WKH7XVFDQ)XFLQLZKR ZDVHTXDOO\WDNHQDEDFNE\ZKDWKHVDZ7KHFLYLFDXWKRULWLHVEOLWKHO\

,7$/,$11$3/(6

HPEHOOLVKHGWKHVHDIURQWRI&KLDLDZLWKWKHKDQGVRPHSURPHQDGHRI WKHYLD&DUDFFLRORSURYLGHGLOOXPLQDWLRQIRUWKHHOHJDQWFRPPHUFLDO ERXOHYDUGV RI YLD7ROHGR DQG YLD &KLDLD DQG DOORFDWHG VXEVWDQWLDO VXEVLGLHVIRUWKHRSHUDVHDVRQDWWKH6DQ&DUOR ,QWKHSRRUHVWVHFWLRQVRI1DSOHVLWZDVQRWXQXVXDOIRUHQWLUH IDPLOLHVWROLYHLQDVLQJOHZLQGRZOHVVURRPDEDVVRZKHUHWKH\ VOHSWOLYHGDQGFRRNHG7KHUHZDVQRSOXPELQJ²KRXVHKROGZDVWH ZDVWKURZQRXWLQWRVWUHHWVDQGFRXUW\DUGV,Q/HWWHUVIURPD0RXUQLQJ &LW\ WKH 6ZHGLVK SK\VLFLDQ$[HO 0XQWKH DGGHG KLV RZQ YRLFH WR WKRVHRIRWKHUVZKRVRXJKWWRGUDZWKHDWWHQWLRQRIDPRUHHDUQHVW SXEOLF WR WKH FRQGLWLRQV RI WKH 1HDSROLWDQ SRRU GHVFULELQJ KRZ PDQ\OLYHGLQ¶WKHPRVWJKDVWO\KXPDQKDELWDWLRQVRQWKHIDFHRI WKHHDUWK· 7KH7LPHVRI/RQGRQFRQFXUUHGGHVFULELQJWKHFKDUQHO KRXVHVIRQGDFL RI1DSOHVLQYLYLGGHWDLO ,PDJLQHWKHGRRUZD\RIDFDYHZKHUHRQHQWHULQJ\RXPXVWGHVFHQG 1RWDUD\RIOLJKWSHQHWUDWHVLQWRLWH[FHSWE\WKHRQHDSHUWXUH\RX KDYH SDVVHG WKURXJK DQG WKHUH EHWZHHQ IRXU EODFN EDWWHUHG ZDOOV DQG XSRQ D OD\HU RI ILOWK PL[HG ZLWK SXWULG VWUDZ WZR WKUHH DQG IRXUIDPLOLHVYHJHWDWHWRJHWKHU7KHEHVWVLGHRIWKHFDYHQDPHO\WKDW WKURXJKZKLFKKXPLGLW\ILOWUDWHVWKHOHDVWLVRFFXSLHGE\DUDFNDQG PDQJHU WR ZKLFK DQLPDOV RI YDULRXV NLQGV DUH WLHG D KRUVH LW PD\ EHRUDQDVVDFDOIRUDSLJ2QWKHRSSRVLWHVLGHDKHDSRIERDUGV DQG UDJV UHSUHVHQW WKH EHGV ,Q RQH FRUQHU LV WKH ILUHSODFH DQG WKH KRXVHKROGXWHQVLOVOLHDERXWWKHIORRU7KLVDWURFLRXVVFHQHLVDQLPDWHG E\ D VZDUP RI KDOIQDNHG GLVKHYHOOHG ZRPHQ RI FKLOGUHQ HQWLUHO\ QDNHGUROOLQJDERXWLQWKHGLUWDQGRIPHQVWUHWFKHGRQWKHJURXQG LQWKHVOHHSRILGLRF\6XFKLVD1HDSROLWDQ)RQGDFKR>VLF@0XOWLSO\LW E\WKRXVDQGV5HPHPEHUWKDWDKXQGUHGWKRXVDQGEHLQJVDWOHDVWKDYH QRRWKHUVKHOWHUWKDWWKH\RQO\OLYHRQIUXLWDQGYHJHWDEOHVRQVQDLOV DQGRQLRQVZLWKRXWHYHQFKDQJLQJWKHLUUDJVRQFHLQD\HDUZLWKRXW ZDWHUH[FHSWVXFKDVIORZVLQDGHQVHLPSXUHULYXOHWZLQGLQJWKURXJK WKRVHODQHV

,17+(6+$'2:2)9(689,86

$YHUDJH SRSXODWLRQ GHQVLW\ LQ SRVWXQLILFDWLRQ 1DSOHV ZDV WHQ WLPHV PRUH WKDQ WKDW RI9LFWRULDQ /RQGRQ7KH ORFDO MRXUQDOLVW 0DWLOGH 6HUDR DWWHPSWLQJ WR UDLVH DZDUHQHVV RI WKH VLWXDWLRQ SXEOLVKHGKHUDFFRXQWVRIVRPHRIWKHPRVWLPSRYHULVKHGVOXPVLQD VHULHVRIDUWLFOHVJDWKHUHGXQGHUWKHWLWOH,OYHQWUHGL1DSROL7KH%RZHOV RI1DSOHV LQFOXGLQJRQHDOOH\ZD\ZKLFKWKHDXWKRURIWKLVZRUN UHFRJQLVHV DVWKHORFDWLRQRIKHUVWXGHQWIODW¶$QRWKHUVWUHHWWKH VRFDOOHG6DQWD%DUEDUDVWHSVLVDOVRYHU\RULJLQDO2QERWKVLGHVOLYH IDOOHQZRPHQZKRKDYHPDGHWKLVWKHLUGRPDLQ«WKH\WKURZILJ VNLQVZDWHUPHORQULQGVUXEELVKDQGILVKERQHVIURPWKHLUZLQGRZV RQ DQ\RQH SDVVLQJ WKURXJK (YHU\WKLQJ UHPDLQV RQ WKH VWHSV DQG FOHDQSHRSOHQRORQJHUGDUHWRZDONWKURXJK·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

,7$/,$11$3/(6

0RVWRIWHQORFDWHG«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

'U0XQWKHDVVLVWHGWKHDXWKRULWLHVLQ1DSOHVGXULQJWKHHSLGHPLF $WWKHKHLJKWRIWKHFULVLV.LQJ8PEHUWR,RI,WDO\YLVLWHG1DSOHV DFFRPSDQLHG E\ WKH 3ULPH 0LQLVWHU$JRVWLQR 'HSUHWLV$V WKH\ SURJUHVVHG WKURXJK WKH SRRUHVW VHFWLRQV RI WKH FLW\ WKH\ ZHUH YLVLEO\PRYHGE\WKHH[WHQWRIWKHVXIIHULQJDQGYRZHGWRXQGHUWDNH DSURJUDPPHRIXUEDQUHIRUP'HSUHWLVIDPRXVO\H[FODLPHG¶:H PXVW GLVHPERZHO 1DSOHV· 7KH ,WDOLDQ JRYHUQPHQW SDVVHG /DZ IRUWKH5LVDQDPHQWRVOXPFOHDUDQFH RI1DSOHVZLWKGLUHFW VWDWHLQWHUYHQWLRQDQGILQDQFLQJWKURXJKWUHDVXU\ERQGVVSHQGLQJ PLOOLRQOLUHLQDQHIIRUWWRUHEXLOGWKHFLW\WKURXJKWKHPRVW H[WHQVLYHWRZQSODQQLQJSURMHFWVLQFH'RQ3HGURGL7ROHGREXLOWWKH 6SDQLVK4XDUWHUVWKUHHFHQWXULHVHDUOLHU%\¶GLVHPERZHOOLQJ·WKH ROGFLW\DQGGHVWUR\LQJWKHPHGLHYDOVWUHHWVWKHFOHDUDQFHSURMHFW UDGLFDOO\WUDQVIRUPHGWKHDSSHDUDQFHRIPDQ\QHLJKERXUKRRGV 7KHPDLQIRFXVRIWKHSURMHFWZDVWKHQHZDYHQXHOHDGLQJIURP WKHVWDWLRQWRWKH0DVFKLR$QJLRLQRNQRZQDVWKH5HWWLÀORFRUVR 8PEHUWR , 7KH GHVWUXFWLRQ RI HQWLUH QHLJKERXUKRRGV DQG WKH EXLOGLQJRIZLGHQHZVWUHHWVWROHWOLJKWDQGDLULQWRWKHROGWRZQ ZHUH GLIILFXOW HQGHDYRXUV DQG PDQ\ KLVWRULF DUHDV GLVDSSHDUHG 7KH YHU\ SLFWXUHVTXH JROGVPLWKV· QHLJKERXUKRRG ZKLFK KDG IRU FHQWXULHVEHHQWKHKRPHRI1DSOHV·JROGDQGVLOYHUFUDIWVPHQZDV DOOEXWGHVWUR\HG&RPSOHWHO\QHZVHZDJHSLSHVDQGDQHZZDWHU

,17+(6+$'2:2)9(689,86

VXSSO\ ZHUH UHTXLUHG WR DYRLG IXUWKHU RXWEUHDNV RI GLVHDVH7KH ODUJHVTXDUHDWWKHMXQFWLRQEHWZHHQWKH5HWWLÀORDQGWKHUHFHQWO\ FRQVWUXFWHG YLD 'XRPR ZDV QDPHG 3LD]]D 1LFROD $PRUH DIWHU WKH PD\RU ZKR KDG SXW VR PXFK LQWR WKH SURMHFW 7RGD\ PDQ\ 1HDSROLWDQVUHIHUWRWKHRFWDJRQDOVTXDUHDVWKHTXDWWURSDOD]]LDIWHU WKH IRXU ODUJH DSDUWPHQW EORFNV SRVLWLRQHG RQ LWV IRXU FRUQHUV 1HZXQLYHUVLW\EXLOGLQJVJUDFHGWKLVERXUJHRLVFRPPHUFLDOVWUHHW 7KHXSSHUIORRUVRIWKHVKRSVDQGUHVWDXUDQWVZHUHJLYHQRYHUWR PLGGOHFODVV KRPHV ZKRVH SULFHV ZHUH LQDFFHVVLEOH WR SUHYLRXV UHVLGHQWVRIWKHGHPROLVKHGDUHDV0DWLOGH6HUDRMXVWO\XUJHGWKH JRYHUQPHQWWRRIIHUUHDOVROXWLRQVWRWKHIXQGDPHQWDOSUREOHPVRI WKHVH QHLJKERXUKRRGV (YDFXHHV IURP WKH WHQHPHQWV GHVSHUDWHO\ UHTXLUHG UHKRXVLQJ EXW LW WRRN VRPH WLPH XQWLO WKH9DVWR SXEOLF KRXVLQJSURMHFWZDVILQDOO\FRPSOHWHGRQUHFODLPHGPDUVKODQGV 5HEXLOGLQJRQDVPDOOHUVFDOHDOVRWRRNSODFHLQWKH6DQWD%ULJLGD DUHD QHDU WKH 5R\DO 3DODFH QDPHG DIWHU WKH 6ZHGLVK VDLQW ZKR KDG YLVLWHG 1DSOHV GXULQJ WKH WLPH RI WKH$QJHYLQV7KLV SURMHFW LQFOXGHGWKHHOHJDQWEHOOHp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

,7$/,$11$3/(6

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

,17+(6+$'2:2)9(689,86

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·V GUHDPWKDWWKHFKXUFKODWHUEHFDPHD3RQWLILFDO%DVLOLFDRQHRIWKH JUHDWHVW0DULDQVKULQHVLQ(XURSHDQG3RSH-RKQ3DXO,,SURFODLPHG KLVEHDWLILFDWLRQ $EMHFW SRYHUW\ PHDQW WKDW WKURXJKRXW 1DSOHV DQG 6RXWKHUQ ,WDO\WKRXVDQGVGHFLGHGWROHDYHLQVHDUFKRIDEHWWHUIXWXUH0DQ\ FKRVHWRPDNHDQHZOLIHLQ$PHULFD1XPHURXVVKLSVOHIW1DSOHV ILOOHGZLWKWKRVHZKRGUHDPHGRIQHZRSSRUWXQLWLHVDEURDG7KH YDVWPDMRULW\ZHUHDJULFXOWXUDOZRUNHUV%\WKHHQGRIWKHFHQWXU\ WKH$PHULFDQFRQVXOLQ1DSOHV-RKQ67ZHOOVUHSRUWHGWKDW¶YDVW PXOWLWXGHV RI HPLJUDQWV DUH OHDYLQJ WKH 3RUW RI 1DSOHV « HYHU\ VWHDPHU VDLOLQJ WR 1HZ
,7$/,$11$3/(6

WRWUDYHOWR1DSOHVRQWKHUHWXUQLQJVKLSV0DUN7ZDLQZDVERZOHG RYHUE\WKHVLJKWVDQGVRXQGVRIWKHFLW\ ¶6HH1DSOHVDQGGLH·:HOO,GRQRWNQRZWKDWRQHZRXOGQHFHVVDULO\ GLHDIWHUPHUHO\VHHLQJLWEXWWRDWWHPSWWROLYHWKHUHPLJKWWXUQRXWD OLWWOHGLIIHUHQWO\7RVHH1DSOHVDVZHVDZLWLQWKHHDUO\GDZQIURPIDU XSRQWKHVLGHRI9HVXYLXVLVWRVHHDSLFWXUHRIZRQGHUIXOEHDXW\$W WKDWGLVWDQFHLWVGLQJ\EXLOGLQJVORRNHGZKLWH²DQGVRUDQNRQUDQN RIEDOFRQLHVZLQGRZVDQGURRIVWKH\SLOHGWKHPVHOYHVXSIURPWKH EOXHRFHDQWLOOWKHFRORVVDOFDVWOHRI6DLQW(OPRWRSSHGWKHJUDQGZKLWH S\UDPLGDQGJDYHWKHSLFWXUHV\PPHWU\HPSKDVLVDQGFRPSOHWHQHVV $QGZKHQLWVOLOLHVWXUQHGWRURVHV²ZKHQLWEOXVKHGXQGHUWKHVXQ·V ILUVW NLVV ² LW ZDV EHDXWLIXO EH\RQG DOO GHVFULSWLRQ 2QH PLJKW ZHOO VD\ WKHQ¶6HH 1DSOHV DQG GLH·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
+HQU\ -DPHV ZKR ORYHG WUDYHOOLQJ LQ ,WDO\ DOVR VSHQW WLPH LQ 1DSOHVDQGVWUXFNXSDIULHQGVKLSZLWK0DWLOGH6HUDR+HJUHDWO\ DGPLUHGKHUZRUNDQGGHVFULEHGKHUWRIULHQGVDV¶WKHH[DFWRSSRVLWH RI-DQH$XVWHQ· 1DSOHV FRQWLQXHG WR GUDZ (XURSHDQ YLVLWRUV IURP (QJODQG )UDQFH *HUPDQ\ 5XVVLD DQG 6FDQGLQDYLD DOWKRXJK PXFK KDG FKDQJHGVLQFHWKHGD\VRIWKH*UDQG7RXU7KHDUHDZDVVWLOODWWUDFWLYH

,17+(6+$'2:2)9(689,86

WRDUWLVWVDQGOLWHUDU\ILJXUHVEXWLWLQFUHDVLQJO\SOD\HGKRVWWRWKH VZHOOLQJ UDQNV RI PLGGOHFODVV KROLGD\PDNHUV RQ RUJDQLVHG WRXUV $UW KLVWRULDQ -RKQ 5XVNLQ KHOG D ORZ RSLQLRQ RI WKH RUGLQDU\ (QJOLVKYLVLWRU¶7KHFRPPRQ(QJOLVKWUDYHOOHULIKHFDQJDWKHUD EODFNEXQFKRIJUDSHVZLWKKLVRZQILQJHUVDQGKDYHKLVERWWOHRI )DOHUQLDQEURXJKWWRKLPE\DJLUOZLWKEODFNH\HVDVNVQRPRUHRI WKLVZRUOGQRUWKHQH[WDQGGHFODUHV1DSOHVD3DUDGLVH·5XVNLQ KLPVHOIWKRXJKW1DSOHVWREH¶FHUWDLQO\WKHPRVWGLVJXVWLQJSODFH LQ(XURSH·FRPELQLQJ¶WKHYLFHRI3DULVZLWKWKHPLVHU\RI'XEOLQ DQGWKHYXOJDULW\RI1HZ
,7$/,$11$3/(6

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

,17+(6+$'2:2)9(689,86

6RUUHQWR5DYHOORDQG&DSUL:LWKLWVRYHUFURZGLQJSRYHUW\DQG XQHPSOR\PHQW QRW WR PHQWLRQ VHULRXV RXWEUHDNV RI GLVHDVH 1DSOHVZDVQRORQJHUSHUFHLYHGDVDQDWWUDFWLYHWRXULVWGHVWLQDWLRQ )ULHGULFK1LHW]VFKHSUHIHUUHG6RUUHQWRZKHUHKHFRXOGORRNRXW XSRQWKHEHDXW\RI1DSOHVIURPDGLVWDQFH¶:KHQIRUWKHILUVWWLPH ,VDZWKHHYHQLQJFRPHXSRYHU1DSOHVZLWKLWVVDWLQJUH\DQGUHG LQWKHVN\WKLVWKRXJKWVXGGHQO\RYHUZKHOPHGPH
,7$/,$11$3/(6

EXLOGKLVGUHDPKRPHRQWKHEHDXWLIXOVLWH+HQU\-DPHVZKRZDVD JXHVWRI'U0XQWKHDWKLVYLOODGHVFULEHGWKHLQFUHGLEOHYLHZV 6RUUHQWR DQG9HVXYLXV ZHUH RYHU DJDLQVW \RX 1DSOHV IXUWKHVW RII PHOWHGLQWKHPLGGOHRIWKHSLFWXUHLQWRVKLPPHULQJYDJXHQHVVDQG LQQRFHQFHDQGWKHORQJDUPRI3RVLOOLSRDQGWKHSUHVHQFHRIWKHRWKHU LVODQGV3URFLGDWKHVWULFNHQ,VFKLDPDGHWKHPVHOYHVIHOWWRWKHOHIW 7KHJUDQGDLURILWDOOZDVLQRQH·VYHU\QRVWULOVDQGVHHPHGWRFRPH IURPVRXUFHVWRRQXPHURXVDQGWRRFRPSOH[WRQDPH,WZDVDQWLTXLW\ LQVROXWLRQ«

6RPXFKGLG-DPHVHQMR\WKH¶WKHPHUFLOHVV-XQHEHDXW\RI1DSOHV %D\ DW WKH VXQVHW KRXU· WKDW KH HQFRXUDJHG KLV IULHQG WR ZULWH D ERRNDERXWWKHURPDQWLFWDOHRIWKHYLOOD·VFRQVWUXFWLRQ7KH 6WRU\RI 6DQ0LFKHOHZRXOGEHFRPHRQHRIWKHILUVWLQWHUQDWLRQDOEHVWVHOOHUV RI WKH WZHQWLHWK FHQWXU\ DQG IXUWKHU FRQWULEXWHG WR WKH LVODQG·V IDPH 6HYHUDO QRUWKHUQ (XURSHDQV WUDYHOOHG WR &DSUL LQ RUGHU WR H[SHULHQFH¶WKHORYHWKDWGDUHQRWVSHDNLWVQDPH·ZLWKRXWIHDURI SURVHFXWLRQ WKH PRVW QRWRULRXV DPRQJ WKHP EHLQJ 2VFDU:LOGH DQGKLVEHORYHG¶%RVLH·/RUG$OIUHG'RXJODV7KH\PHWLQ1DSOHV VKRUWO\DIWHU:LOGH·VUHOHDVHIURPSULVRQDQGWKHSRHWFRPSRVHGWKH UHQRZQHG %DOODG RI 5HDGLQJ *DRO GXULQJ WKHLU VRMRXUQ:LOGH DQG %RVLHDOVRVSHQWWLPHLQ6RUUHQWRDQGDWDVHFOXGHGYLOODDW/H*DLROH RQWKHWLSRIWKH3RVLOOLSRSURPRQWRU\ :KLOH1DSOHVOLYHGWKURXJKDGLIILFXOWPRPHQWZLWKWKHFKROHUD HSLGHPLF DQG WKH XQLILFDWLRQ WKH H[WUDRUGLQDU\ IORZHULQJ RI WKH 1HDSROLWDQVRQJEURXJKWVRODFHWRPDQ\ULFKZLWKEHDXW\DQGYDULHW\ $IWHUDVKRUWEUHDNGXULQJWKH\HDUVRIWKH5LVRUJLPHQWRWKH3LHGLJURWWD VRQJIHVWLYDOZDVUHHVWDEOLVKHG7KHFKDUPLQJDQGLQFUHGLEO\FDWFK\ )XQLFXOuIXQLFXOjE\*LXVHSSH7XUFRDQG/XLJL'HQ]DZDVZULWWHQIRU WKHLQDXJXUDWLRQRIWKHWRXULVWIXQLFXODUZKLFKZHQWXSDOPRVWWR WKHWRSRI9HVXYLXVLQWKHKRSHRIHQFRXUDJLQJWKH1HDSROLWDQVWR RYHUFRPHWKHLUIHDUVIRUWKLVQHZPHWKRGRIWUDQVSRUW

,17+(6+$'2:2)9(689,86

-DPPHMDPPH ¶QFRSSDMDPPHLD -DPPH-DPPH ¶QFRSSDMDPPHLD )XQLFXOu)XQLFXOj )XQLFXOu)XQLFXOj ¶QFRSSDMDPPHMD )XQLFXOu)XQLFXOj /HW·V JR OHW·V JR /HW·V JR WKHUH XS WRS/HW·V JR OHW·V JR /HW·V JR WKHUH XS WRS)XQLFXKHUH )XQLFXWKHUH )XQLFXKHUH )XQLFX WKHUH/HW·VJRWKHUHXSWRS)XQLFXKHUH)XQLFXWKHUH

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¶(VSLQJROHIUDQJHVHEHSOD\HGE\D PLOLWDU\EDQG7\SLFDOWKHPHVLQVXFKVRQJVDOORIZKLFKZHUHZULWWHQ LQWKHORFDOYHUQDFXODUZHUHXQUHTXLWHGORYHDQGWKHH[DOWDWLRQRI WKHEHDXWLHVRIWKH%D\RI1DSOHV6HUHQDGHVOLNH$0DUHFKLDUHDQG9RFH ¶H1RWWHZHUHDOVRYHU\SRSXODU7KHPDLQH[SRQHQWRIWKLVJROGHQ HUDWKHUHILQHGSRHW6DOYDWRUHGL*LDFRPRKDGWKHJRRGIRUWXQHWR ZRUNZLWKWDOHQWHGORFDOPXVLFLDQVJLIWHGZLWKDSHUIHFWFRPPDQG RIWKHWHFKQLTXHVRIFRPSRVLWLRQ¶(FHUDVHDQG(UDGLPDJJLRZLWK O\ULFVE\GL*LDFRPRFRQWULEXWHGWRVSUHDGLQJLQWKHZRUOGDQLG\OOLF LPDJHRI1DSOHVDVWKHKRPHWRHWHUQDO6SULQJZLWKDQDEXQGDQFHRI IUXLWDQGEORRPLQJJDUGHQV7KHPRVWVXFFHVVIXO1HDSROLWDQVRQJV

,7$/,$11$3/(6

ZULWWHQLQWKHORFDOGLDOHFWDUHDVNLOIXODPDOJDPRIODQJXRUSDVVLRQ ZLWDQGVHQWLPHQWDOLW\ZKLFKWRXFKWKHKHDUWVWULQJVDQGHYRNHWKH QRVWDOJLF PHPRULHV RI 1HDSROLWDQV PLJUDQWV ZKHUHYHU WKH\ ILQG WKHPVHOYHVLQWKHZRUOG0XVLFDOVRVHUYHGDVDQLPSRUWDQWXQLI\LQJ IDFWRUIRUWKH1HDSROLWDQVDWKRPHDVWKHVRQJVZHUHHQWKXVLDVWLFDOO\ VXQJE\PHPEHUVRIDOOVRFLDOFODVVHV 'HVSLWHWKHFLW\·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pVIUHTXHQWHGE\WKHJDJjWKHÀQGHVLqFOH FXOWXUHG1HDSROLWDQGDQGLHV 3ULYLOHJHGKLJKVRFLHW\LQ1DSOHVZRXOGPHHWDWWKH&DIp*DPEUL QXVDQGWKHFLW\·VORYHDIIDLUZLWKFDIIHLQHZDVILUPO\HVWDEOLVKHG 1R 1HDSROLWDQ GD\ LV FRPSOHWH ZLWKRXW HQMR\LQJ D WD]]XOHOOD¶H FDIIpOLWWOHFXSRIHVSUHVVRFRIIHH 7UXHFRQQRLVVHXUVVWLOOSUHIHUWR

,17+(6+$'2:2)9(689,86

XVH WKH WUDGLWLRQDO 1HDSROLWDQVW\OH FRIIHHPDNHU ZKLFK UHTXLUHV VSHFLDODWWHQWLRQDVWKHHQWLUHPDFKLQHPXVWEHWXUQHGXSVLGHGRZQ KDOIZD\WKURXJKEUHZLQJLQRUGHUWRREWDLQDSHUIHFWWD]]XOHOOD7KH EHVWNQRZQFDIpZDVXQGRXEWHGO\*DPEULQXVORFDWHGDFURVVIURP WKHRSHUDKRXVHZKLFKZDVIUHTXHQWHGE\SKLORVRSKHUVSDLQWHUV ZULWHUVDQGDUWLVWV,WZDVDOVRDSRSXODUVSRWWRUHDG1DSOHV·RZQ TXDOLW\GDLO\QHZVSDSHULO0DWWLQRIRXQGHGE\(GRDUGR6FDUIRJOLR DQGKLVZLIH0DWLOGH6HUDRLQ)ROORZLQJWKHGHSDUWXUHRIWKH %RXUERQ FRXUW PDQ\ 6ZLVV SDVWU\ FKHIV WKH\ KDG HPSOR\HG ORVW WKHLU UR\DO DSSRLQWPHQWV DQG GHFLGHG WR RSHQ VPDOO VKRSV LQ WKH FLW\7KHPRVWIDPRXVSDVWU\VKRSZDV3LQWDXURLQYLD7ROHGRZKHUH ORFDOGHOLFDFLHVVXFKDVEDEjDVSRQJHFDNHVHUYHGZLWKJHQHURXV UXPIODYRXULQJ SDVWLHUDDULFRWWDFKHHVHFDNHZLWKJUDLQFDQGLHG IUXLW DQG FLWUXV IODYRXULQJ DQG VIRJOLDWHOOD D VKHOOVKDSHG ULFRWWD SDVWU\ UDSLGO\ DWWDLQHG FXOW VWDWXV (YHU\ \HDU RQ )DWKHU·V 'D\ FHOHEUDWHG LQ ,WDO\ RQ WKH IHDVW RI 6DLQW -RVHSK 0DUFK WKH 1HDSROLWDQVZRXOGTXHXHRXWVLGHWKH3LQWDXUREDNHU\WRSXUFKDVH GHHSIULHG]HSSROHDVDVSHFLDOWUHDW$QLQVFULSWLRQDERYHWKHIDPRXV VKRS SURXGO\ SURFODLPV ¶+(5( 7+( 6)2*/,$7(//$ :$6 ,19(17(',1·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

,7$/,$11$3/(6

WKDWLWZDVRULJLQDOO\SUHSDUHGE\ORFDOQXQV1HDSROLWDQFDIpVDUH HTXDOO\IDPRXVIRUWKHLULFHFUHDPVZKLFKDUHNQRZQWRKDYHEHHQ FRQVXPHG LQ WKH FLW\ VLQFH WKH HDUO\ VL[WHHQWK FHQWXU\ ZKHQ LW LV VDLG &DUGLQDO 3RPSHR &RORQQD GHYHORSHG VXFK D SDVVLRQ IRU WKHPWKDWH[FHVVFRQVXPSWLRQZDVWKRXJKWWRKDYHEHHQDIDFWRU LQKLVXQWLPHO\GHDWK7KH*D\2GLQFKRFRODWHIDFWRU\QRZDORFDO LQVWLWXWLRQZDVRSHQHGLQ :KHQ WKH PLGGOHFODVV 1HDSROLWDQV ZHUHQ·W VRFLDOLVLQJ RYHU VZHHWV LQ ORFDO FDIp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¶SL]]HULD·DVD1HDSROLWDQGLDOHFWWHUPDQGLQDOO RIKLVZULWLQJVWKHSRHW6DOYDWRUHGL*LDFRPRZRXOGLWDOLFL]HWKH ZRUGV¶SL]]D· DQG¶SL]]HULD· LQGLFDWLQJ WKDW WKH\ ZHUH VSHFLILFDOO\ 1HDSROLWDQGLDOHFWWHUPV

,17+(6+$'2:2)9(689,86

7KH1HDSROLWDQSL]]DKDVEHFRPHDQ,WDOLDQQDWLRQDOGLVK:LWK WKH ZLGHVSUHDG FXOWLYDWLRQ RI WRPDWRHV LQ &DPSDQLD LQ WKH ODWH QLQHWHHQWKFHQWXU\DQRWKHU1HDSROLWDQFXOLQDU\VWDSOHUDJDPHDW DQGWRPDWRVDXFHIRUSDVWDJDLQHGFRPPRQFXUUHQF\8QOLNHWKH %RORJQHVHYHUVLRQRIWKHUHFLSHPDGHZLWKJURXQGEHHIWKHPRUH IUXJDO 1HDSROLWDQ UHFLSH FDOOV IRU D FXW RI PHDW WR EH FRRNHG LQ WKH VDXFH DQG ODWHU UHPRYHG OHDYLQJ EHKLQG RQO\ LWV IODYRXULQJV 7KH PHDW LV WKHQ VHUYHG ZLWK YHJHWDEOHV IRU WKH VHFRQG FRXUVH 1HDSROLWDQUDJLVDVLPSOHGLVKEXWLWVSUHSDUDWLRQKDVEHHQWXUQHG LQWRDQDUWIRUPE\JHQHUDWLRQVRIORFDOFRRNV2Q6XQGD\PRUQLQJV WKHFLW\·VVWUHHWVDUHILOOHGZLWKWKHDURPDRI UDJEHLQJSUHSDUHGIRU IDPLO\OXQFK,QRUGHUWRWUXO\WDNHRQIXOOIODYRXULWPXVWERLODWD ORZWHPSHUDWXUHIRUILYHWRVL[KRXUV 0XFKRIWKHZRUOG·VDWWLWXGHWR1DSOHVDQGLWVLQKDELWDQWVGDWHV IURPWKHODWHQLQHWHHQWKFHQWXU\DQGLQGHHGWKHLPDJHRI1DSOHVLQ WKHIRUHLJQSV\FKHLVRIWHQVXSHULPSRVHGRYHUWKDWRI,WDO\DVDZKROH 7KHPXVLFWKHSL]]DWKHVXQVKLQHDQGWKHEOXHVHDVWKHRXWJRLQJ FRUGLDOKRVSLWDOLW\DQGWKHGHYRXW&DWKROLFLVPRIWKHSHRSOHZHUH DOOSDUWRIWKHLPDJHRI1DSOHVWDNHQWRWKHQHZZRUOGE\WKHPDQ\ HFRQRPLF PLJUDQWV ZKR WHQGHG WR QRVWDOJLFDOO\ UHPHPEHU DOO WKH HQFKDQWLQJDVSHFWVRI1DSOHVZLWKDIRQGQHVVERUQIURPDEVHQFH 0RVWRIWKHHDUO\HPLJUDQWVZHUHVLQJOHPHQ7KHZRPHQJHQHUDOO\ WUDYHOOHGODWHULQFRPSDQ\ZLWKWKHLUFKLOGUHQWRMRLQWKHLUKXVEDQGV 7KHDYHUDJHDJHIRUWKHPHQUDQJHGEHWZHHQDQG\HDUVZLWKD QRWDEOHQXPEHURISHUVRQVXQGHU7KHZRPHQWHQGHGWREHROGHU 6RPHFDUHVKRXOGEHXVHGLQWKHDQDO\VLVRIWKHSURIHVVLRQVGHFODUHG E\WKHHPLJUDQWVEHFDXVHWKHUHZDVQRQHFHVVDU\FRQQHFWLRQEHWZHHQ WKHLUVNLOOVDQGWKHLUHPSOR\PHQWLQWKHQHZZRUOG$PRQJWKHVNLOOV OLVWHGE\HPLJUDQWVIURP1DSOHVLWVHOIILJXUHPDQ\WUDGLWLRQDOFUDIWV ZDWFKPDNHUVWDLORUVFDUSHQWHUVVPLWKVEDUEHUVSDLQWHUVPDVRQV SULQWHUV SKRWRJUDSKHUV JORYH PDNHUV OHDWKHU ZRUNHUV FRRNV

,7$/,$11$3/(6

EXWFKHUVDQGSDVWU\PDNHUVZLWKWKHRFFDVLRQDOSUHVHQFHRIRWKHU SURIHVVLRQVVXFKDVPXVLFLDQVRUERRNLOOXVWUDWRUV)DUPHUVQDWXUDOO\ PDGHXSWKHPDMRULW\RIHPLJUDQWVIURPWKHFRXQWU\VLGH 7KH7ZHQWLHWK&HQWXU\

,QDSXEOLFLQTXLU\OHGE\6HQDWRU*LXVHSSH6DUHGRLQYHVWLJDWHG LUUHJXODULWLHV LQ WKH FLYLF DGPLQLVWUDWLRQ RI 1DSOHV $OWKRXJK KH UHFRJQLVHG WKDW PDQ\ RI 1DSOHV· SUREOHPV ZHUH WKH UHVXOW RI HUURUVE\WKHQDWLRQDOJRYHUQPHQWWKHSUHIDFHWR6DUHGR·VUHSRUW DWWHPSWHGWRSODFHEODPHIRUWKHFLW\·VGLIILFXOWLQWHJUDWLRQZLWKLQ D XQLWHG ,WDO\ RQ SUHVXPHG HWKQLF LQIHULRULW\ RI WKH VRXWKHUQHUV $FROOHFWLRQRIHVVD\VE\1HDSROLWDQHFRQRPLVW)UDQFHVFR6DYHULR 1LWWLHQWLWOHG4XHVWLRQH1DSROLRIIHUHGDPRUHVFLHQWLILFH[DPLQDWLRQ RI WKH LVVXHV EXW QRQHWKHOHVV FRQFXUUHG ZLWK 6DUHGR·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·SRRUVWLOOOLYHGLQDWURFLRXVFRQGLWLRQVDQGWKH UHWXUQ RI FKROHUD LQ ² FDXVHG WKH GHDWKV RI EHWZHHQ IRXUDQGILYHWKRXVDQGSHRSOHPDQ\RIWKHPYHU\\RXQJFKLOGUHQ 6XFKZDVWKHLPSRUWDQFHRIWKHWRXULVWWUDGHWKDWWKHDXWKRULWLHV PLQLPLVHGWKHUDYDJHVRIWKHGLVHDVHVRDVQRWWRGHWHUIRUHLJQHUV IURPYLVLWLQJ1DSOHV6DGO\WKLVLUUHVSRQVLEOHSXEOLFKHDOWKSROLF\ LPSHGHG WKH HIIRUWV QHFHVVDU\ WR GHDO ZLWK DQ HSLGHPLF RI VXFK SURSRUWLRQVDQGRQO\DJJUDYDWHGWKHVLWXDWLRQIRUWKHFLW\·VSRRU

,17+(6+$'2:2)9(689,86

:LWK1DSOHVDWVXFKDORZHEEWKHQXPEHUVRIWKRVHORRNLQJIRU DEHWWHUOLIHLQWKHQHZZRUOGVRDUHGWRWKHLUKLJKHVWOHYHOVHYHU %HWZHHQDQGURXJKO\SHUFHQWRI,WDOLDQHPLJUDQWV WR$PHULFDFDPHIURP6RXWKHUQ,WDO\2YHUDPLOOLRQSHRSOHOHIW &DPSDQLDGXULQJWKHHDUO\\HDUVRIWKHWZHQWLHWKFHQWXU\WKHYDVW PDMRULW\KHDGHGIRU1HZ
,7$/,$11$3/(6

ZRXOGGRVRZLWKJUHDWHPRWLRQ¶2VROHPLRE\*LRYDQQL&DSXURDQG (GXDUGRGL&DSXDSHUKDSVWKHPRVWFHOHEUDWHG1HDSROLWDQVRQJRI DOOWLPHLVFORVHO\DVVRFLDWHGZLWK&DUXVRZKRPDGHLWDJOREDOKLW $OWKRXJKWKHPHORG\LVSUDFWLFDOO\V\QRQ\PRXVZLWK1DSOHVLWZDV DFWXDOO\ZULWWHQLQ2GHVVDZKLOH(GXDUGRGH&DSXDZDVWRXULQJLQ 5XVVLDZLWKKLVYLROLQLVWIDWKHUGRXEWOHVVVXIIHULQJIURPQRVWDOJLD IRUWKH1HDSROLWDQVXQVKLQH &KHEHOODFRVD¶QDMXUQDWD¶HVROH 1·DULDVHUHQDGRSSR¶QDWHPSHVWD 3H·OO·DULDIUHVFDSDUHJLj¶QDIHVWD FKHEHOODFRVD¶QDMXUQDWD¶HVROH :KDW D EHDXWLIXO WKLQJ D VXQQ\ GD\ ZLWK WUDQTXLO VNLHV DIWHU WKH VWRUP7KHDLULVFRRODQGHYHU\WKLQJORRNVIHVWLYHZKDWDEHDXWLIXO WKLQJDVXQQ\GD\

&DUXVRSOD\HGDQLPSRUWDQWUROHLQWKHSRSXODULW\DQGSUHVWLJH RIVXFKFRPSRVLWLRQVE\LQFRUSRUDWLQJWKHPLQWRWKHFODVVLFDOWHQRU UHSHUWRU\ +LV VRQ UHDOLVHG WKDW¶LQ VSLWH RI WKH DWWDFKPHQW DQG JUDWLWXGHKHIHOWWRZDUGVWKH8QLWHG6WDWHVDQGWRZDUGV1HZ

,17+(6+$'2:2)9(689,86

$FKLHYHPHQW$ZDUGDQGVHYHUDORIKLVUHFRUGLQJVKDYHQRZEHHQ GLJLWDOO\UHPDVWHUHG &DUXVR V\PEROLVHG WKH DVSLUDWLRQV DQG WKH QRVWDOJLD RI DOO WKH 1HDSROLWDQVZKROHIWIRUDQHZOLIHLQ$PHULFDDQGKLVSURPRWLRQ RI WKH 1HDSROLWDQ VRQJ WUDGLWLRQ HQVXUHG WKDW LW JDLQHG KXJH LQWHUQDWLRQDO IDPH GXULQJ WKH ILUVW KDOI RI WKH WZHQWLHWK FHQWXU\ 7KH VRQJV WRJHWKHU ZLWK WKH EHDXW\ RI WKH FLW\·V QDWXUDO VHWWLQJ FRQWLQXHGWRUHSUHVHQW,WDO\LQWKHH\HVRIPRVWIRUHLJQHUVDQGEULQJ WHDUVWRWKHH\HVRIWKRVHZKRKDGOHIW,QWKLVZD\PXVLFFRQWULEXWHG IXUWKHUWRWKHLGHDOLVDWLRQRI1DSOHV7KH1HDSROLWDQVRQJVHYRNHG D VHQWLPHQWDO LPDJH RI 1DSOHV QRW XQOLNH WKH URPDQWLFLVHG SURVH RI *RHWKH·V ,WDOLDQ7UDYHOV ZKLFK KDG IXHOOHG WKH *UDQG7RXU WZR FHQWXULHVHDUOLHU7KHHDUO\WZHQWLHWKFHQWXU\ZDVWKHJROGHQDJH RI 1HDSROLWDQ SRSXODU PXVLF DQG IDPRXV VRQJV VXFK DV 7RUQD D 6XUULHQWRTXLFNO\EHFDPHLQWHUQDWLRQDOKLWV(OHJDQWFOXEVNQRZQDV FDIpFKDQWDQWVEHFDPHSRSXODU0DQ\SURPLQHQWSHUIRUPHUVVDQJ DQGGDQFHGDWWKH6DORQH0DUJKHULWDLQWKHJDOOHULD8PEHUWR2QH GD\ WKH SRHW *DEULHOH G·$QQXQ]LR IRXQG KLPVHOI GULQNLQJ FRIIHH DW*DPEULQXVZLWKORFDOSRHWDQGVRQJZULWHU)HUGLQDQGR5XVVR ZKRPDLQWDLQHGWKDWRQO\D1HDSROLWDQFRXOGFRPSRVHD1HDSROLWDQ VRQJ '·$QQXQ]LR ERUQ LQ 3HVFDUD VRXJKW WR SURYH KLP ZURQJ DQGLQWKHVSDFHRIRQO\DIHZPLQXWHVFRPSRVHG¶$YXFFKHOODWKH OLWWOHPRXWK ODWHUVHWWRPXVLFE\)UDQFHVFR3DROR7RVWL,WEHFDPHD IDYRXULWHRI&DUXVRZKRUHFRUGHGWKHYLUWXRVRSLHFHLQRQHRIKLV ODVWVHVVLRQV,WLVWKRXJKWE\PDQ\WREHKLVJUHDWHVWUHFRUGLQJ :KLOHWKHSRRUOHIWLQGHVSHUDWLRQIRUHLJQHUVFRQWLQXHGWRIORFN WR1DSOHVDOWKRXJKWKHDPRXQWRIWLPHWKH\DFWXDOO\VSHQWLQWKH FLW\ZDVOLPLWHG)URPLWVRSHQLQJLQJHQWOHPDQ·VRXWILWWHUV 0DULQHOODEHFDPHDSODFHRISLOJULPDJHIRUZHDOWK\WRXULVWVZLVKLQJ WR EX\ KDQGPDGH WLHV PDGH IURP WKH ILQHVW LPSRUWHG VLON7KH FRIIHH KRXVHV DQG SDVWU\ VKRSV ZHUH DOVR IUHTXHQWHG DVVLGXRXVO\

,7$/,$11$3/(6

EXW 1DSOHV VHUYHG PDLQO\ DV D EDVH IRU H[FXUVLRQV WR RQH RI WKH QHDUE\ UHVRUWV:DOWHU %HQMDPLQ DVWXWHO\ REVHUYHG WKDW¶LW LV HDV\ WRORYH1DSOHVIURPWKHVHD·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¶/LNHDQDQWLTXHSULQWWKHFLW\LV JHQHURXVO\EDWKHGLQEULJKWVXQOLJKWDQGVLQJVOLNHDQRUJDQ7KH OLJKW EOXH ZDYHV RI WKH JXOI EHDW LQ UK\WKP RQ WKH VWRQHV RI WKH VKRUHLQDFFRPSDQLPHQWWRWKHVRXQGVDQGVKRXWVRIWKHFURZGV OLNH WKH UROOV RI D WDPERXULQH·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

,17+(6+$'2:2)9(689,86

%ULJLGDDUHDOHDYLQJGHDGDQGZRXQGHGWKHKRUURUVRIZDU ZHUHIHOWGLUHFWO\LQWKHFLW\,WZDVDKXJHUHOLHIZKHQWKH1HDSROLWDQ JHQHUDO$UPDQGR'LD]VLJQHGWKHDUPLVWLFHZKLFKEURXJKWWKHZDU WRDQHQG9LFWRU\VRRQWXUQHGWRGLVDSSRLQWPHQWZKHQIDFWRULHV ORVWWKHLUGHIHQFHFRQWUDFWVDQGZRUNHUVORVWWKHLUMREV$VVROGLHUV UHWXUQHGIURPWKHZDUGLVLOOXVLRQPHQWVHWWOHGLQ,WZDVQRWORQJ EHIRUHWKHUHZDVPDUFKLQJDQHZ 2Q2FWREHU1DSOHVVHUYHGDVWKHGHSDUWXUHSRLQWIRU %HQLWR 0XVVROLQL·V 0DUFK RQ 5RPH DV )DVFLVW VXSSRUWHUV IURPDOORYHU,WDO\ZHDULQJEODFNVKLUWVSDUDGHGWKURXJKWKHVWUHHWV RI1DSOHVEHIRUHOHDYLQJIRUWKHFDSLWDO$QH[FLWHGFURZGJDWKHUHG DWWKH6DQ&DUORWRKHDU0XVVROLQL·VURXVLQJH[KRUWDWLRQ /HDGHUV /HJLRQQDLUHV %ODFN VKLUWV RI 1DSOHV DQG DOO ,WDO\7RGD\ ZLWKRXW VWULNLQJ D VLQJOH EORZ ZH KDYH FRQTXHUHG WKH EXUQLQJ YLEUDWLQJVRXORI1DSOHVWKHEXUQLQJVRXORIWKH6RXWKRI,WDO\7KH GHPRQVWUDWLRQLVQRZFRPSOHWHDQGFDQQRWEHWXUQHGLQWRDEDWWOH%XW ,VD\WR\RXZLWKDOOWKHVHULRXVQHVVWKDWWKHPRPHQWGHPDQGVWKDWLW LVRQO\DPDWWHURIGD\VSHUKDSVHYHQKRXUVEHIRUHWKHJRYHUQPHQWLV HLWKHUKDQGHGRYHUWRXVRUZHZLOOVHL]HLWIRURXUVHOYHVE\PDUFKLQJ RQ5RPH

7KH%ODFN6KLUWVFKHHUHGWKHLUOHDGHUEXWPDQ\RIWKRVHSUHVHQW MHHUHGDQGZKLVWOHGDVKHVSRNH1RQHWKHOHVVXSRQKLVDUULYDOLQ 5RPH 0XVVROLQL ZDV DSSRLQWHG +HDG RI *RYHUQPHQW E\ .LQJ 9LWWRULR(PDQXHOH,, 7KHWZRGHFDGHVRI)DVFLVWUXOHWKDWIROORZHGUHSUHVHQWHGDSHULRG RIJUHDWSXEOLFZRUNVIRU1DSOHV$OWKRXJKXQHPSOR\PHQWFRQWLQXHG WR EH KLJK RUJDQLVHG FULPH ZDV YLUWXDOO\ HOLPLQDWHG 'XULQJ 0XVVROLQL·VWLPHLQSRZHUDQXPEHURILPSRUWDQWLPSURYHPHQWV ZHUH PDGH LQ WKH FLW\ ZKLFK JOHDPHG LQ 0D\ IRU +LWOHU·V RIILFLDO YLVLW7KH FLW\·V SRUW IDFLOLWLHV DQG UDLOZD\ QHWZRUN ZHUH H[SDQGHG DQG D QHZ DLUSRUW DQG VXEZD\ V\VWHP EXLOW ([WHQVLYH

,7$/,$11$3/(6

UHQRYDWLRQVZHUHFDUULHGRXWDWWKH6DQ&DUORWKH9LOOD)ORULGLDQD DQGWKH$UFKDHRORJLFDO0XVHXPDQGDKXJHFXUYLOLQHDUSRVWRIILFH FRQVWUXFWHG LQ WKH PRQXPHQWDO (XURSHDQ PRGHUQ VW\OH ZDV WKH FHQWUHSLHFH RI D QHZ FRPSOH[ RI SXEOLF EXLOGLQJV VXUURXQGLQJ 3LD]]D&DULWj$QHQRUPRXVH[KLELWLRQKDOOWKH0RVWUDGHOOH7HUUH G·2OWUHPDUHZDVEXLOWDVDVKRZFDVHIRU0XVVROLQL·V¶0HGLWHUUDQHDQ (PSLUH· WKH EHDXWLIXO YLD 3HWUDUFD ZDV FDUYHG LQWR WKH 3RVLOOLSR KLOODQGD0XVHXPRI3DODHRQWRORJ\ZDVHVWDEOLVKHG3R]]XROLKDGD VLJQLILFDQWHQJLQHHULQJLQGXVWU\ZKLFKZDVVXEVWDQWLDOO\H[SDQGHG EHWZHHQ WKH ZDUV DQG D WRUSHGR IDFWRU\ ZDV EXLOW LQ QHDUE\ %DLD7DNLQJ DGYDQWDJH RI WKH UHJLPH·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

,17+(6+$'2:2)9(689,86

FXOWXUHIRURYHUWKLUW\\HDUVLQGHIHQFHRIWKHLGHDOVRIOLEHUW\+LV HUXGLWLRQDQGWKHVFLHQWLILFPHWKRGZLWKZKLFKKHFRQGXFWHGKLV KLVWRULFDOOLWHUDU\SKLORVRSKLFDODQGSROLWLFDOUHVHDUFKDOORZHGKLP WRSHUPHDWHDQGLQIOXHQFHZKROHVHFWRUVRI,WDOLDQFXOWXUH&URFH EHFDPHDQRXWVSRNHQFULWLFRIWKHUHJLPHKHORVWWKHIULHQGVKLSRI KLVORQJWLPHFROODERUDWRU*LRYDQQL*HQWLOH 6XSSRUWHG E\ VXEVWDQWLDO SHUVRQDO UHVRXUFHV &URFH GHGLFDWHG KLVOLIHWRKLVOLWHUDU\KLVWRULFDODQGSKLORVRSKLFDOVWXGLHV2QHRI &URFH·VOLIHORQJSDVVLRQVZDVKLVGHHSORYHIRU1DSOHVDQGLWVKLVWRU\ :KHQ WKH ZHDOWK\ ERXUJHRLVLH ZHUH PRYLQJ RXW WR WKH9RPHUR 5LYLHUDGL&KLDLDDQG3RVLOOLSR&URFHSUHIHUUHGWRUHPDLQLQWKHROG WRZQZKHUHKHWUXO\IHOWDSDUWRIWKHIDEULFRI1DSOHVLWVKLVWRU\ DQG WUDGLWLRQV )URP WKH PDJQLILFHQW 3DOD]]R )LORPDULQR DORQJ 6SDFFDQDSROLLQ WKH ROG WRZQ KLV VWXG\ ORRNHG RYHU WKH VSOHQGLG PHGLHYDOEHOOWRZHURIWKH6DLQW&ODUHFKXUFK :KHQULVLQJIURPP\GHVN,ORRNRXWIURPWKHEDOFRQ\RIP\VWXG\ RYHUWKHDQFLHQWEXLOGLQJV«EHIRUHPHWRWKHULJKWORRPVWKHEHOO WRZHURI6DQWD&KLDUDDQG,DOPRVWIHHOWKDW,FDQUHDFKRXWDQGWRXFK LW«,WLVDVZHHWVHQVDWLRQWRIHHOVXUURXQGHGE\WKHHPEUDFHRIWKHVH ROGEXLOGLQJVSURWHFWHGDQGFDUHGIRUE\WKHLUIDPLOLDUDSSHDUDQFH

&URFH·V +LVWRU\RIWKH.LQJGRPRI1DSOHV LVDFODVVLFKLVWRU\ RIWKHFLW\KHORYHG5HIOHFWLQJXSRQ1DSOHV·UROHZLWKLQDXQLILHG ,WDO\&URFHZDVLQFLVLYH :LWK WKH HQG RI WKH .LQJGRP RI 1DSOHV DQG WKH DQQH[DWLRQ RI WKH VRXWK WR WKH UHVW RI ,WDO\ WKH KLVWRU\ RI WKH .LQJGRP DV D SROLWLFDO HQWLW\ FDPH WR DQ HQG « WKHUH KDYH EHHQ PDQ\ FRPSODLQWV DQG DFFXVDWLRQVDJDLQVWWKH6RXWKZLWKRXWLW,WDO\ZRXOGKDYHKDGDPRUH KRPRJHQHRXV GLVWULEXWLRQ RI ZHDOWK DQG FXOWXUH WKH SHUFHQWDJH RI LOOLWHUDF\ZRXOGQRWKDYHEHHQVRKLJKJRYHUQPHQWVZRXOGQRWKDYH ZRQVRPDQ\ERXJKWYRWHVWKHPRQDUFK\ZRXOGKDYHJLYHQZD\WR D UHSXEOLF H[FHVVLYH FHQWUDOLVDWLRQ FRXOG KDYH EHHQ DYRLGHG WR WKH

,7$/,$11$3/(6

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« DQG HDFK RI WKHVH REVHUYDWLRQV SRVVHVVHVDJUDLQRIWUXWK«

3DWLHQWO\DZDLWLQJLWVGHPLVH&URFHSUHVFLHQWO\YLHZHGIDVFLVPDV DSDUHQWKHVLVLQWKHKLVWRU\RI,WDO\DQGRI1DSOHV%\WKHHQGRIWKH 6HFRQG:RUOG:DUDIWHU0XVVROLQL·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

,17+(6+$'2:2)9(689,86

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² VWXGHQWV ZRUNHUV FRPPXQLVWV DQG PRQDUFKLVWV ²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·VGHOD\ZHUHKLGGHQWKURXJKRXWWKHFLW\1RW ORQJDIWHU,WDO\HQWHUHGWKHZDUWKHPRVWSUHFLRXVGRFXPHQWVRIWKH 1HDSROLWDQVWDWHDUFKLYHVZHUHPRYHGWRVDIHW\LQWKHFRXQWU\VLGH ,QRQHRIWKHPRVWWUDJLFHSLVRGHVRIZDUWLPHFXOWXUDOEDUEDULVP ZKHQVRPH*HUPDQVROGLHUVZHUHNLOOHGE\SDUWLVDQVQHDU1DSOHV D MXQLRU RIILFHU GHFLGHG WR WDNH UHYHQJH E\ GHVWUR\LQJ WKH VWRUHG DUFKLYHV:KHQWKHFXVWRGLDQREMHFWHGYHKHPHQWO\RQWKHJURXQGV WKDWWKHDUFKLYDOGRFXPHQWVFRQVWLWXWHGDSULFHOHVVUHJLVWHURIWKH

,7$/,$11$3/(6

UHLJQRIWKHJUHDW*HUPDQHPSHURU)UHGHULFN,,KHZDVJUXGJLQJO\ JLYHQDIHZPLQXWHVWRUHPRYHVRPHRIWKHPRVWSUHFLRXVLWHPV EHIRUHWKHDUFKLYHVZHQWXSLQVPRNHREOLWHUDWLQJPXFKRI1DSOHV· HDUO\KLVWRULFDOUHFRUGV 2Q2FWREHUWKH%ULWLVK(LJKWK$UP\DQG$PHULFDQ)LIWK$UP\ DUULYHGWR¶VHH1DSOHVDQGFU\·%\WKHHQGRI6HSWHPEHUPRVWRI WKHH[RWLFILVKLQWKH$TXDULXPKDGEHHQFRQVXPHGE\WKHVWDUYLQJ SRSXODFHDOWKRXJKWKHPRVWSUL]HGH[KLELWDEDE\PDQDWHHZDV OHIWIRUWKH$PHULFDQ/LHXWHQDQW*HQHUDO0DUN&ODUN·VILUVWPHDO LQWKHFLW\0RVWRIWKH1HDSROLWDQVZHUHE\WKLVSRLQWUHGXFHGWR VFDYHQJLQJIRUGDQGHOLRQV7KH%ULWLVKVROGLHUVZHUHH[FLWHGDWWKH SURVSHFW RI VHHLQJ 1DSOHV IRU WKHPVHOYHV$OWKRXJK WKH VLWXDWLRQ ZDVJULP\RXQJ%ULWLVKJXQQHU6SLNH0LOOLJDQVKRZHGRIILQFLSLHQW FRPLFIODLULQDOHWWHUKRPH &RU1DSOHVHK":HZRXOGDOOOLNHWREHLQ1DSOHV,WZRXOGEHWKHILUVW (XURSHDQFLW\VLQFHZHOHIW(QJODQGQHDUO\WZR\HDUVDJR:H·YHDOO EHHQZDUQHGRIWKH¶GDQJHUV·,IWKHEURFKXUHZDVWHOOLQJWKHWUXWK YHQHUHDO GLVHDVH ZDV ZDONLQJ WKH VWUHHWV RI 1DSOHV DQG RQH FRXOG FRQWUDFWLWMXVWE\VKDNLQJKDQGVZLWKDSULHVW

$ODQ 0RRUHKHDG DQ (QJOLVK ZULWHU ZLWK WKH .LQJ·V 'UDJRRQ *XDUGVGHVFULEHGWKHVFHQHDVKHHQWHUHGWKHFLW\IURP6DOHUQR $VZHGURYHRYHUWKH6RUUHQWRSHQLQVXODDQGFDXJKWVLJKWRIWKHFLW\ IRUWKHILUVWWLPHLWVHHPHGWKDWQRWKLQJKDGFKDQJHG7KHEODFNFRQH RI9HVXYLXVVPRNLQJJUDFHIXOO\RQWKHULJKW7KHLVOHRI&DSULVHUHQHO\ IORDWLQJ EH\RQG WKH PRXWK RI WKH ED\7KH FUHQXODWHG FLW\ VSLOOHG DORQJ WKH VKRUH DQG WKDW VDPH PHVPHULVLQJ EOXHQHVV LQ WKH ZDWHU 6XQVKLQHDQGRUDQJHJURYHV%ULOOLDQWFUHHSHUVRQWXPEOLQJZDOOV7KH HQHUYDWLQJ DWPRVSKHUH RI D ORQJ OD]\ VXPPHU·V DIWHUQRRQ 'ULYLQJ WKRXJK &DVWHOODPPDUH DQG 3RPSHLL WKH FURZG WKLFNHQHG VWHDGLO\ DORQJWKHURDG2QWKHRXWVNLUWVRI1DSOHVLWVHOILWZDVRQHWXPXOWXRXV PRERIVFUHDPLQJK\VWHULFDOSHRSOHDQGWKLVFRQWLQXHGDOOWKHZD\

,17+(6+$'2:2)9(689,86

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«)RUDQ\RQHZKRORYHG,WDO\ LWZDVDELWWHUH[SHULHQFHWRFRPHWR1DSOHV7KHWUDGLWLRQDOWDOHQWV RIWKHSHRSOHWKHLUFKDUPDQGJHQHURVLW\VHHPHGIRUDWLPHWRKDYH YDQLVKHGLQWKHVDYDJHDQGDEMHFWVWUXJJOHIRUH[LVWHQFH

0LUDFXORXVO\WKH6DQ&DUOR2SHUD+RXVHKDGEHHQVSDUHGIURP ERPELQJV DQG QHYHU FORVHG ,W ZDV UHTXLVLWLRQHG E\ WKH (QJOLVK DQGSHUIRUPDQFHVZHUHKHOGIRUWKHEHQHILWRI$OOLHGVROGLHUVEXW IRU WKH RFFXS\LQJ WURRSV OLIH LQ 1DSOHV ZDV QR KROLGD\ 1RUPDQ /HZLVD%ULWLVKLQWHOOLJHQFHRIILFHUDVVLJQHGWRWKH$PHULFDQ)LIWK $UP\NHSWDGLDU\LQZKLFKKHUHFRUGHGKLVDFFRXQWRIWKHGHHSO\ WUDXPDWLVHGSHRSOHRI1DSOHVDQGWKHLULQGRPLWDEOHZLOOWRVXUYLYH +LVERRN1DSOHV·LVRQHRIWKHPRVWPRYLQJDFFRXQWVZULWWHQ DERXWWKH6HFRQG:RUOG:DU 2FWREHU ,W LV DVWRQLVKLQJ WR ZLWQHVV WKH VWUXJJOHV RI WKLV FLW\ VR VKDWWHUHG VR VWDUYHG VR GHSULYHG RI DOO WKRVH WKLQJV WKDW MXVWLI\ D FLW\·V H[LVWHQFH WR DGDSW LWVHOI WR D FROODSVH LQWR FRQGLWLRQV ZKLFK PXVWUHVHPEOHOLIHLQWKH'DUN$JHV3HRSOHFDPSRXWOLNH%HGRXLQV LQGHVHUWVRIEULFN7KHUHLVOLWWOHIRRGOLWWOHZDWHUQRVDOWQRVRDS$ ORWRI1HDSROLWDQVKDYHORVWWKHLUSRVVHVVLRQVLQFOXGLQJPRVWRIWKHLU FORWKLQJLQWKHERPELQJVDQG,KDYHVHHQVRPHVWUDQJHFRPELQDWLRQV RIJDUPHQWVLQWKHVWUHHWV«

7KURXJKRXW 1DSOHV VXIIHUHG RQH RI WKH ZRUVW SHULRGV RI GHSULYDWLRQ LQ LWV KLVWRU\7KHUH ZDV D GUDPDWLF LQFUHDVH LQ

,7$/,$11$3/(6

SURVWLWXWLRQDQGDUHYLYDORIWKHFDPRUUD·VIRUWXQHV7KH$PHULFDQ DUP\ SRVVHVVHG DQ HQRUPRXV HFRQRPLF VXUSOXV RI FLJDUHWWHV EODQNHWVXQLIRUPVDQGIRRGDOPRVWKDOIRIZKLFKVHHPHGWRILQG LWVZD\RQWRWKHEODFNPDUNHW7KH86$VRRQHPHUJHGDVWKHPRVW LPSRUWDQW LQWHUQDWLRQDO SDUWQHU WKH SULPH VXSSOLHU RI HFRQRPLF DLGDQGWKHPDMRUDOO\IRU,WDO\LQWKHSRVWZDUSHULRG&LJDUHWWHV DQG FKRFRODWH DUULYHG RQ WKH EODFN PDUNHW WRJHWKHU ZLWK WKH ILUVW MD]] DQG VZLQJ UHFRUGV (YHU\WKLQJ$PHULFDQ ZDV VXGGHQO\ IDVKLRQDEOH .QRZQDVWKH¶'GD\GRGJHUV·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

,17+(6+$'2:2)9(689,86

7KHHUXSWLRQ·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¶7KH NH\ WR D VXFFHVVIXO SDUOLDPHQWDU\ FDUHHU LQ 1DSOHV LV KDYLQJ D IROORZLQJ RU D FOLHQWHOH 7KH EXLOGLQJ RI D FOLHQWHOH UHTXLUHV HFRQRPLF UHVRXUFHV RU SDWURQDJH ,Q FRQVHTXHQFH WKH SROLWLFLDQ ZLWK SDUOLDPHQWDU\DPELWLRQVLVREOLJHGWRMRLQDQRUJDQLVDWLRQWRZLQ UHVRXUFHV· 3ROLWLFLDQV DQG SURIHVVLRQDO FULPLQDOV WUDGHG YRWHV IRU SXEOLFVHFWRUFRQWUDFWV7KHFDPRUUD·VDELOLW\WRSURYLGHMREVZDVDQ HVVHQWLDO IDFWRU LQ LWV SRSXODULW\ DQG VXFFHVV LQ SRVWZDU 1DSOHV /DXUR KDQGHG WKH FLW\ RYHU WR FDPRUUDEDFNHG GHYHORSHUV ZKR

,7$/,$11$3/(6

SDYHG1DSOHVDQGWKHVXUURXQGLQJDUHDZLWKFHPHQW&RQVWUXFWLRQ SURYLGHGPXFKQHHGHGMREVEXWPDQ\RIWKHEHDXWLIXOJUHHQDUHDV DURXQG1DSOHVZHUHGHVWUR\HGE\XQVFUXSXORXVEXLOGHUV)UDQFHVFR 5RVL·VILOP /HPDQLVXOODFLWWj+DQGVRYHUWKH&LW\ GHQRXQFHGWKH PDQ\ FRQVWUXFWLRQ SURMHFWV ZKLFK PDGH WKH FLW\ PRUH PRGHUQ DQGDQRQ\PRXV)ROORZLQJ/DXUR·VUHLJQWKH&KULVWLDQ'HPRFUDW $QWRQLR*DYDWRJHWKHUZLWKKLVIDWKHUDQGVRQPRQRSROLVHGWKH SROLWLFDOVFHQHLQ1DSOHVIRUPDQ\\HDUV7KH*DYDG\QDVW\PDGHD IRUWXQHLQEDQNLQJDQGFRQVWUXFWLRQ ,QGXVWULDOLVDWLRQZDVRQFHDJDLQVHHQDVDSDQDFHDIRUWKHFLW\·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¶GHVHUWFDWKHGUDOV·RI6RXWKHUQ,WDO\DZHOONQRZQH[DPSOHLVWKH $OID5RPHRIDFWRU\DW3RPLJOLDQRG·$UFRZKRVHFRQVWUXFWLRQZDV LQWHQGHGWROHDGWRWKHGHYHORSPHQWRIDORFDOFRPSRQHQWLQGXVWU\

,17+(6+$'2:2)9(689,86

7KHSURMHFWIDLOHGDE\VPDOO\DQGWKHDUHDDURXQGWKHPDVVLYHVKHOO RIWKHIDFWRU\UHVHPEOHGDGHVHUW,QWKHHQGPDLQO\EHFDXVHWKH &DVVD·V REMHFWLYHV ZHUH QRW DFKLHYHG WKH &KULVWLDQ 'HPRFUDWLF 3DUW\SURYHGXQDEOHWRPDLQWDLQSROLWLFDOFRQWUROLQ1DSOHV ,Q $PHULFDQ $GPLUDO 5REHUW &DUQH\ ZDV DSSRLQWHG DV FRPPDQGHU RI DQ LQWHJUDWHG PXOWLQDWLRQDO 1$72 IRUFH EDVHG DERDUG WKH 866 0RXQW 2O\PSXV KDUERXUHG LQ WKH %D\ RI 1DSOHV 1DSOHVZDVDVWUDWHJLFFKRLFHIRUWKH$OOLHG)RUFHV6RXWKHUQ(XURSH $)6287+ EDVH EHFDXVH LW RIIHUHG ODUJHVFDOH IOHHW VXSSRUW DQGLWZDVDOVRLQGLUHQHHGRIDQLQMHFWLRQRIHFRQRPLFVXSSRUW $)6287+ ZDV LQLWLDOO\ UHVSRQVLEOH IRU WKH SURWHFWLRQ RI VHYHUDO YLWDOVHDODQHVRIFRPPXQLFDWLRQDJDLQVW6RYLHWH[SDQVLRQWRZDUGV WKH0LGGOH(DVWDQGWKH3HUVLDQ*XOI1RZORFDWHGLQ%DJQROLLW LVDFHQWUHIRUSHDFHNHHSLQJPLVVLRQVSDUWLFXODUO\LQWKH%DONDQV 7KH FRPPDQGHULQFKLHI UHVSRQGLQJ GLUHFWO\ WR WKH 6XSUHPH $OOLHG&RPPDQGHULQ0RQV%HOJLXP LVDQ$PHULFDQGHVLJQDWHG UROHDQGLQGHHGWKH$PHULFDQVPDNHXSDERXWSHUFHQWRIWKH LQWHUQDWLRQDOFRPPXQLW\DW$)6287+7KHLUSUHVHQFHLQ1DSOHV LV IXUWKHU UHLQIRUFHG ZLWK D ORFDO$PHULFDQ VFKRRO DQG$PHULFDQ KRVSLWDOWKH16$EDVHDW&DSRGLFKLQRDQGWKH866L[WK)OHHW7KHLU IODJVKLSWKH866/DVDOOHLVEDVHGDVKRUWGLVWDQFHWRWKHQRUWKDW *DHWD86PLOLWDU\SHUVRQQHODQGWKHLUGHSHQGHQWVWRGD\QXPEHU RYHU LQ WKH 1DSOHV DUHD7KH ORFDO$PHULFDQ FRQVXODWH LV ODUJHUWKDQPDQ\HPEDVVLHVDQGDGPLQLVWHUV²PLOOLRQPRQWKO\ LQ SHQVLRQ EHQHILWV IRU QDWXUDOLVHG 86 FLWL]HQV OLYLQJ LQ 6RXWKHUQ ,WDO\7RGD\ WKH $PHULFDQV DUH WKH ODUJHVW DQG PRVW LQIOXHQWLDO FRPPXQLW\RIIRUHLJQHUVLQWKHFLW\ 7KHLU LQFUHDVHG SUHVHQFH LQ 1DSOHV UHLQIRUFHG WKH P\WK RI $PHULFD6KRUWO\DIWHUWKHZDU1HDSROLWDQFDEDUHWVLQJHU5HQDWR &DURVRQH KHDGOLQHG D WULR ZKLFK SHUIRUPHG DW WKH OHJHQGDU\ 6KDNHU&OXE7RJHWKHUZLWKJLIWHGO\ULFLVW1LFROD6DOHUQRWKHWULR

,7$/,$11$3/(6

VXFFHVVIXOO\FRPELQHGWKHQHZUK\WKPVRI$PHULFDQPXVLFZLWKWKH 1HDSROLWDQVRQJWUDGLWLRQSURGXFLQJVRPHRIWKHPRVW¶GDQFHDEOH· WXQHV HYHU7ZR RI WKHLU JUHDWHVW KLWV ZHUH WKH URPDQWLF EDOODG 0DUX]]HOOD DQG WKH ERRJLHZRRJLH FODVVLF 7X YXR· IDU O·DPHULFDQR

,17+(6+$'2:2)9(689,86

LQVSLUHGE\LWVVRQJWUDGLWLRQ7KHKLVWRU\RIWKHFLW\DQGLWVSHRSOHLV SRUWUD\HGWKURXJKWKHVWRU\RIWKHVLQJHU6DOYDWRUH(VSRVLWRDQGKLV QXPHURXVIDPLO\VWUXJJOLQJWRPDNHHQGVPHHW(YHU\1HDSROLWDQ VWHUHRW\SHLVFHOHEUDWHGWKHSUHVHSHWKHED\9HVXYLXVSL]]D«HYHQ 2VROHPLRLVVXQJLQDQLURQLFYHUVLRQXQGHUSRXULQJUDLQ7KHVWDUV LQFOXGHGWKHWHQRUV%HQLDPLQR*LJOLDQG&DUOR7DJOLDEXHDQGDYHU\ \RXQJ 6RSKLD /RUHQ &DURVHOOR QDSROHWDQR ZDV DZDUGHG WKH¶*UDQG 3UL[ ,QWHUQDWLRQDO· DW WKH &DQQHV ILOP IHVWLYDO ,W ZDV D FRORXUIXO H[DPSOHRIWKH1HDSROLWDQ]HVWIRUOLIHDWDWLPHZKHQWKHUHVWRI,WDO\ ZDVPDNLQJGDUNQHRUHDOLVWILOPVVXFKDV5REHUWR5RVHOOLQL·V 3DLVj WKHVWDUNO\GHSUHVVLQJSRUWUD\DORI,WDO\GXULQJWKH$OOLHGDGYDQFH 1HDSROLWDQERUQ9LWWRULR 'H 6LFD DOVR PDGH QHRUHDOLVW ILOPV W\SLFDORIWKHDJHVXFKDV%LF\FOH7KLHYHVDQGWKHFULWLFDOO\DFFODLPHG 7KH*ROGRI1DSOHV9HU\XQOLNHKLVRWKHUVWDUNQHRUHDOLVWSRUWUD\DOV RIOLIHLQSRVWZDU,WDO\WKHILOPLVDVHULHVRIHSLVRGHVFHOHEUDWLQJ WKHFLW\·VJUHDWHVWUHVRXUFH²LWVSHRSOH²EDVHGRQWKHHSRQ\PRXV ERRNE\*LXVHSSH0DURWWD7KH*ROGRI1DSOHVLVGHILQHGDV¶WKHORYH RIOLIHSDWLHQFHDQGFRQWLQXRXVKRSHRIWKH1HDSROLWDQV·'H6LFD KLPVHOIVWDUUHGLQWKHILOPZKLFKDOVRLQFOXGHGSHUIRUPDQFHVE\ WKH WRS 1HDSROLWDQ DFWRUV RI WKH SHULRG WKH FRPLF JHQLXV7RWz SOD\ZULJKW DQG DFWRU (GRDUGR GH )LOLSSR DQG 6RSKLD /RUHQ7KH UROH DV WKH FDUHIUHH ZLIH RI D SL]]D PDNHU ODXQFKHG 6RSKLD·V ELJ VFUHHQFDUHHU7KH*ROGRI1DSOHVKHOGVSHFLDOSHUVRQDOVLJQLILFDQFH IRU'H6LFDDVD1HDSROLWDQ %RWK0DURWWDDQG,IHHOVRVWURQJO\DERXW1DSOHVWKDW,EHOLHYHWKHILOP ZLOOVXFFHHGDWIDFHYDOXHIRUZKDWLWKDVDOZD\VEHHQ,QGHHGRQHRIWKH P\VWHULHVRI1DSOHVLVSUHFLVHO\WKLVVWDWLFTXDOLW\RYHUWKHFHQWXULHVVR WKDWWKHSHRSOHRI1DSOHVZLWKWKHLUFXVWRPVWKHLUWUDGLWLRQVDQGWKHLU SKLORVRSK\ZLOOQHYHUFKDQJH«7KHILOPLVVXSSRVHGWREHDSRUWUDLW RIWKHFLW\RIWKHSHRSOHZKROLYHLQWKHFLW\DQGUHDOO\LWFRXOGVLPSO\ EHFDOOHG1($32/,7$16$FWXDOO\DJDLQVWWKHSDQRUDPLFEDFNGURS

,7$/,$11$3/(6

RI1DSOHVP\ILOPZLOOSODFHWKHFLWL]HQVLQWKHIRUHJURXQG%DVLFDOO\ ,ZLOODWWHPSWWRSRUWUD\WKHHVVHQFHRI1DSOHVDQGWKH1HDSROLWDQVLQ DQDQDO\WLFDOZD\

'H6LFDZRXOGZRUNDJDLQZLWK6RSKLDZKHQVKHSOD\HGRQHRI KHUPRVWFKDOOHQJLQJUROHVDVWKHPRWKHULQ7ZR:RPHQIRUZKLFK VKHUHFHLYHGDPRVWGHVHUYHG%HVW$FWUHVV2VFDU+HDOVRFDVW6RSKLD ZLWK0DUFHOOR0DVWURLDQQLLQ

,17+(6+$'2:2)9(689,86

'XULQJWKHGLIILFXOWSRVWZDU\HDUVLQ3R]]XROLVKHVRXJKWIDPHDQG IRUWXQHLQEHDXW\SDJHDQWVDQGILUVWDSSHDUHGDVDQH[WUDLQILOPVVXFK DV%HQ+XU+HUXQXVXDOEHDXW\DQGLUUHJXODUIHDWXUHVWRJHWKHUZLWKD FXUYDFHRXVSK\VLTXHILUVWFDXJKWWKHDWWHQWLRQRIILOPSURGXFHU&DUOR 3RQWLZKHQVKHZDVMXVWDWHHQDJHU3RQWLZDVWKHIDWKHUWKH\RXQJ RUSKDQHGJLUOKDGQHYHUKDGXQGHUZKRVHJXLGDQFHKHUILOPFDUHHU EORVVRPHGRQERWKVLGHVRIWKH$WODQWLF6KHEHFDPHRQHRIWKHILUVW +ROO\ZRRGDFWUHVVHVWRFRPPDQGPLOOLRQIRUKHUILOPUROHVEXW VWLOO6RSKLD·VEHVWDFWLQJLVLQ,WDOLDQDQGSDUWLFXODUO\LQ1HDSROLWDQ 'H6LFDDQG0DVWURLDQQLDOZD\VEURXJKWRXWKHUEHVWSHUIRUPDQFHV 1R RWKHU HQWHUWDLQHU VLQFH &DUXVR KDV EHHQ VR VWURQJO\ LGHQWLILHG ZLWKWKHFLW\6RSKLDZDVWKHJUHDWGLYDRIWZHQWLHWKFHQWXU\,WDOLDQ FLQHPDDQGUHPDLQVDOLYLQJLFRQRIQDSROHWDQHLWj /LIH LQ 1DSOHV ZDV GLIILFXOW LQ WKH SRVWZDU \HDUV DV 6RSKLD ZHOONQHZ%\WKHVWKHUHZHUHFRXQWOHVVVFXJQL]]LRUVWUHHW XUFKLQV URDPLQJ WKH FLW\ FROOHFWLQJ WREDFFR IURP FLJDUHWWH HQGV WRVHOOIRUIRRGDQGVOHHSLQJURXJK0RVWRIWKHVHER\VZHUHDJHG ²DQGKDGQRIDPLOLHVDQGQRIXWXUH0DQ\ZHUHRUSKDQVDQG RWKHUVKDGOHIWWKHLUSRYHUW\VWULFNHQRUG\VIXQFWLRQDOIDPLOLHVWR IHQGIRUWKHPVHOYHV7KHVFXJQL]]LZHUHVHHQDVDEOLJKWRQWKHFLW\ EXWOLWWOHZDVGRQHDERXWWKHSUREOHPXQWLODNLQGO\VHQVLWLYHDQG LQWHOOLJHQW\RXQJSULHVW'RQ0DULR%RUHOOLGHFLGHGWROLYHRQWKH VWUHHWVZLWKWKHPIRUVHYHUDOPRQWKVLQRUGHUWROHDUQPRUHDERXW WKHLU VSHFLILF QHHGV7KH PRYLQJ WDOH LV UHFRXQWHG LQ &KLOGUHQ RI WKH6XQE\0RUULV:HVW7KHERRN·VVXFFHVVEURXJKWLQWHUQDWLRQDO DWWHQWLRQDQGPXFKQHHGHGGRQDWLRQVDOORZLQJ'RQ0DULRWREXLOG WKH&DVDGHOORVFXJQL]]RZKHUHKHFRXOGRIIHUDKRPHDQGDIXWXUH WRKXQGUHGVRIER\V+HZDVGHWHUPLQHGWRGRPRUHWRUHVROYHWKH URRWFDXVHRIWKHSOLJKWRIWKHVFXJQL]]L0DQ\RIWKHPFDPHIURP VOXPVRQWKHRXWVNLUWVRI1DSOHVZKHUHWKHSRRUHVWFLWL]HQVOLYHG LQDSSDOOLQJFRQGLWLRQV'RQ0DULRFRXUDJHRXVO\PRYHGLQWRRQH

,7$/,$11$3/(6

RIWKHVHQHLJKERXUKRRGVLQRUGHUWREHWWHUXQGHUVWDQGWKHDFWXDO GLIILFXOWLHVIDFHGE\ORFDOIDPLOLHV+HJDLQHGWKHLUFRQILGHQFHEXW KHZDVQRWLQLWLDOO\VXFFHVVIXOLQZRUNLQJZLWKWKHFLYLFDXWKRULWLHV WR LPSURYH WKHLU ORW 5LVNLQJ SULVRQ 'RQ 0DULR FRQWDFWHG WKH PHGLDDQGWKUHDWHQHGDSXEOLFKXQJHUVWULNHLIIDPLOLHVLQWKHZRUVW VOXPVZHUHQRWJLYHQVWDWHKRXVLQJ:LWKLQDIHZ\HDUVDOOWKHVOXP GZHOOHUVKDGEHHQPRYHGWRQHZKRPHV7RGD\WKHUHDUHVWLOOVRPH VFXJQL]]LLQ1DSOHVEXWWKH\OLYHZLWKWKHLUIDPLOLHV'RQ0DULR·V ZRUNVHUYHGWRGHPRQVWUDWHWKDWHYHQLQWKHODWHWZHQWLHWKFHQWXU\ &DWKROLFLVPDQG&KULVWLDQJRRGZRUNVFRXOGPDNHDSRVLWLYHLPSDFW RQWKHFRPSOH[VRFLDOSUREOHPVLQKHUHQWWR1DSOHV ,Q WKH SRVWZDU \HDUV WKH FLW\·V GLIILFXOWLHV EHFDPH VR JUHDW WKDW PDQ\ LQWHOOHFWXDOV VKXQQHG WKH¶SRVWFDUG· LPDJH RI 1DSOHV 1RQHWKHOHVVWKHFLW\ZDVVWLOODEOHWRDWWUDFWRXWVWDQGLQJOLWHUDU\ ILJXUHV ZKR VRXJKW WR XQGHUVWDQG LWV PDJLF DQG XQGHUVWDQG LWV FRPSOH[LWLHVZULWHUVVXFKDV3DEOR1HUXGDDQG*XVWDY+HUOLQJDV ZHOODVWKHLU,WDOLDQFROOHDJXHV$OEHUWR0RUDYLDDQG(OVD0RUDQWH ZKRVH QRYHO $UWKXU·V ,VODQG LV VHW RQ 3URFLGD 2XWVWDQGLQJ ORFDO ZULWHUVLQFOXGHG$QQD0DULD2UWHVH'RPHQLFR5HDDQG5DIIDHOH /D&DSULD(QJOLVKFRPSRVHU:LOOLDP:DOWRQILUVWYLVLWHG1DSOHVLQ RQDKROLGD\ZLWKWKH6LWZHOOVDQGZDVVRHQWUDQFHGWKDWKH ODWHUEXLOWDKRXVHRQ,VFKLD7RGD\/D0RUWHOODZKHUH:DOWRQIRXQG KLVLQVSLUDWLRQLVDQLQWHUQDWLRQDOPXVLFDOFHQWUHDQG/DG\:DOWRQ·V JDUGHQV DWWUDFW YLVLWRUV IURP WKURXJKRXW (XURSH ,Q D VLPLODU JHVWXUHVKRUWO\EHIRUHKLVGHDWK%HQHGHWWR&URFHHVWDEOLVKHGWKH ,WDOLDQ,QVWLWXWHIRU+LVWRULFDO5HVHDUFKKLVSHUVRQDOOHJDF\WR\RXQJ VFKRODUVDQGWRWKHFLW\PDNLQJLWRQFHDJDLQDFHQWUHIRUDFDGHPLF H[FHOOHQFH/DWHUWKH,QVWLWXWHIRU&RPEXVWLRQ5HVHDUFKZDVVHWXS WRVHHNQHZWHFKQRORJLFDOVROXWLRQVLQRUGHUWRUHQGHUFRPEXVWLRQ SURFHVVHVPRUHHIILFLHQWDQGHQYLURQPHQWDOO\IULHQGO\DQGDIHZ \HDUVODWHUWKH,WDOLDQ,QVWLWXWHIRU3KLORVRSKLFDO5HVHDUFKRSHQHG

,17+(6+$'2:2)9(689,86

LWVGRRUV8QGHUWKHFRQWLQXHGWHQXUHRI$PHGHR0DLXULH[WHQVLYH GLJJLQJLQ+HUFXODQHXPUHVXOWHGLQWKHH[FDYDWLRQRIWKHVXPSWXRXV 9LOODGHL3DS\UL3RPSHLLKDGVXIIHUHGIURPERPEDUGPHQWVGXULQJ WKH ZDU EXW WKHVH SURYHG H[FHHGLQJO\ IUXLWIXO IRU DUFKDHRORJLVWV EHFDXVHWKH\RSHQHGVHYHUDOQHZDUHDVWRUHVHDUFKDQGVWXG\0DLXUL·V VXFFHVVRU *LXVHSSH 0DJJL ZDV LQIOXHQWLDO LQ REWDLQLQJ PXFK QHHGHG$PHULFDQVSRQVRUVKLSDQGDGHDOZLWK1DWLRQDO*HRJUDSKLF ZKLFK IXUWKHU VHUYHG WR LQFUHDVH WKH IDPH RI WKH DUFKDHRORJLFDO VLWHVDQGWKHSUHVWLJHRI1DSOHV·FXOWXUDOKHULWDJH %\WKHVPRUHWKDQKDOIRIDOOLQGXVWU\LQ6RXWKHUQ,WDO\ZDV ORFDWHGLQ&DPSDQLD7KHVWDWHRZQHG,WDOVLGHUVWHHOZRUNVSURYLGHG MREVIRUZRUNHUVDQGWKH$OID6XGFDUIDFWRU\HPSOR\HGDOPRVW WZLFHDVPDQ\
,7$/,$11$3/(6

ODQJXLVKHGDQGWKHFULPHUDWHVRDUHG,QWKHFLW\VXIIHUHGIURP DQRWKHU FKROHUD HSLGHPLF ZKLFK PLUDFXORXVO\ OHIW RQO\ GHDG DOWKRXJKWKHGDPDJHWRWKHFLW\·VLPDJHZDVLPSRVVLEOHWRTXDQWLI\7KH FLW\·VGHFOLQHFRXOGDOVREHVHHQLQWKHH[WLQFWLRQRIWKHRQFHWKULYLQJ PXVLFWUDGLWLRQ7KHFDPRUUDERVVRIWKHLQIDPRXVQHLJKERXUKRRGRI )RUFHOOD/XLJL*LXOLDQRKDGDKLWRQFRQWUDEDQGFDVVHWWHWDSHVDQG ORFDOUDGLRZLWKWKHVFKPDOW]\&KHOOHYDSD]]HSH·WWH7KDWJLUO·VFUD]\ DERXW\RX DQGWKHFDUHHUVRIPRVW1HDSROLWDQVLQJHUVZHUHUHGXFHGWR VDFFKDULQHDQGXQLQVSLUHGSHUIRUPDQFHVRIROGIDYRXULWHVDWSDUWLHVIRU EDSWLVPVDQQLYHUVDULHVDQGZHGGLQJV3ROLVKGLVVLGHQWZULWHU*XVWDY +HUOLQJZLWQHVVHGWKHFHUHPRQ\IRUWKHPLUDFOHRI6DQ*HQQDURDW WKH&DWKHGUDODQGZDVVDGGHQHGWRREVHUYHWKDWHYHQWKLVHUVWZKLOH KLJKSRLQWRIFLYLFOLIHZDVRQO\DVKDGRZRILWVIRUPHUJORU\ )RU VRPH WLPH WKH PLUDFOH RI 6DQ *HQQDUR WKH SDWURQ VDLQW DQG SURWHFWRU RI 1DSOHV KDV ORVW LWV DQFLHQW VSOHQGRXU « ,W LV GLIILFXOW WRVD\ZK\«SHUKDSVDFHUWDLQUROHZDVSOD\HGE\WKHDSRVWROLFVHH ZKLFKUHFRLOHGIURPWKHLPSOLFLWHOHPHQWVRI¶&KULVWLDQSDJDQLVP·RU ¶EDUEDULDQVW\OHFXOW·2ULWFRXOGEHWKDWZLWKWKHGHDWKRIWKHODVW ZRPHQZKRFRQVLGHUHGWKHPVHOYHVWKH¶UHODWLYHV·RIWKHPDUW\ULQ WKHDOOH\ZD\VWKHSUROHWDULDWUHIHUUHGWRWKHPDVWKH¶ZLGRZV·RI6DQ *HQQDUR WKHVROHPQFHUHPRQ\ZKLFKWDNHVSODFHLQWKH&DWKHGUDORI 1DSOHVLQ6HSWHPEHUZDVGHSULYHGRILWVSULQFLSDOGUDPDWLFHOHPHQW WKHW\SLFDO*UHHNFKRUXVZKLFKEHJJHGIRUWKHPLUDFOHERWKZLWKWKH PRVW KXPEOH VXSSOLFDWLRQV DQG ZLWK LQYHFWLYHV DQG WKUHDWV GLUHFWHG WR WKH FLW\·V SDWURQ DQG SURWHFWRU ZKHQ KH ZDV D ELW VORZ PRYLQJ ,QGHHG LW FRXOG EH WKDW DIWHU VR PDQ\ FHQWXULHV WKH DSSDUHQWO\ LQGHVWUXFWLEOHULWXDORIWKHHWHUQDOZDLWIRUWKHPLUDFOHKDVEHHQZRUQ GRZQRUZHDNHQHG:KDWHYHUWKHUHDVRQWKHIDFWLVWKDWIRUWKHSDVW WHQ\HDUVLQDVHPLGHVHUWHGFDWKHGUDOWKHPLUDFOHVHHPVPRUHOLNH D KXUULHG RIILFLDO FHUHPRQ\ LQ WKH SUHVHQFH RI FKXUFK GLJQLWDULHV DQGUHSUHVHQWDWLYHVRIWKHDXWKRULWLHVUDWKHUWKDQDFURZGHGSRSXODU IHVWLYDODURXQGWKHDOWDURIIDLWKDQGKRSHEHIRUHWKHP\VWHU\RIWKH WUDQVIRUPDWLRQRIGHDGEORRGLQWROLYLQJEORRG

,17+(6+$'2:2)9(689,86

,WVHHPHGWKDWHYHQ6DQ*HQQDURKDGORVWIDLWKLQ1DSOHVZKHQ RQ 1RYHPEHU DQ HDUWKTXDNH WRUH WKURXJK &DPSDQLD OHDYLQJGHDGDQGKRPHOHVV,QWKHIROORZLQJGD\V 1DSOHVORRNHGYHU\PXFKDVLWKDGZKHQWKH$OOLHGWURRSVDULYHG DOPRVW\HDUVSUHYLRXVO\:RUVHVWLOOWKHELOOLRQVVHWDVLGHIRUWKH UHFRQVWUXFWLRQ RI 1DSOHV DQG RWKHU DUHDV LQ &DPSDQLD KLW E\ WKH GHVWUXFWLYHIRUFHRIWKHHDUWKTXDNHKDYHP\VWHULRXVO\YDQLVKHGLQ WKHVFDQGDORIRQHRI(XURSH·VODUJHVWILQDQFLDOIUDXGV $ODUPHG E\ UHSRUWV IURP WKH FLW\ 3RSH -RKQ 3DXO ,, PDGH DQ H[WUDRUGLQDU\ ILYHGD\ YLVLW WR 1DSOHV LQ 1RYHPEHU +H YLVLWHG VRPH RI WKH PRVW GHSULYHG QHLJKERXUKRRGV HQFRXUDJHG EXVLQHVVPHQDQGRUGLQDU\FLWL]HQVWRVWDQGXSWRRUJDQLVHGFULPH DQG GHQRXQFHG WKH FRUUXSW SROLWLFLDQV ZKR KDG DOORZHG WKH GHJUDGDWLRQ RI WKH RQFH SURXG FLW\ 6KRUWO\ DIWHU KLV UHWXUQ WR WKH9DWLFDQ ORFDO MXGJHV DQQRXQFHG WKDW WKH\ ZHUH LQYHVWLJDWLQJ UHSRUWV WKDW KXJH VXPV KDG EHHQ VNLPPHG RII IURP JRYHUQPHQW IXQGV VHW DVLGH WR SURYLGH VHFXULW\ GXULQJ WKH SRQWLII·V YLVLW7KH VLWXDWLRQVHHPHGWUXO\KRSHOHVV,WZDVHVWLPDWHGWKDWWKHPDMRULW\ RI1HDSROLWDQEXVLQHVVHVSDLGSURWHFWLRQPRQH\WRWKHFDPRUUD7KH FLW\ ZKLFK KDG RQFH EHHQ WKH FXOPLQDWLRQ RI WKH *UDQG7RXU QR ORQJHUDWWUDFWHGWRXULVP7KHIHZRXWVLGHUVZKRYHQWXUHGLQWRWKH FLW\ZHUHDWWKHPHUF\RIVFLSSDWRULSXUVHVQDWFKHUV ZKRURDPHG WKHVWUHHWVRQVFRRWHUVORRNLQJIRUYLFWLPV&LW\+DOOZDVEDQNUXSW DQGKDOIRIWKHZRUNIRUFHZDVUHJLVWHUHGDVRIILFLDOO\XQHPSOR\HG 'XULQJWKHV7KH*XDUGLDQ·V,WDOLDQFRUUHVSRQGHQW(G9XOOLDP\ SDLQWHGDGHSUHVVLQJSRUWUDLWRIWKHFLW\ 1DSOHVLVDWKLUGZRUOGFLW\ZLWKWKLUGZRUOGSROLWLFVLWVVXSHUULFK VXUURXQGHGE\DPLVHUDEOHKLQWHUODQGVSUDZOLQJEDFNIURPWKHYROFDQR DQGWKHED\DGLODSLGDWHGMXQJOHRIYLROHQFHKDOIILQLVKHGEXLOGLQJV PRWRUZD\V WKDW OHDG QRZKHUH FRFDLQH SULPLWLYH &DWKROLFLVP DQG VWLQNLQJGXPSHGUXEELVK,WVOHJDOHFRQRP\LVEDVHGRQO\RQODYLVK

,7$/,$11$3/(6

VWDWHDLGPRQH\SURFXUHGE\LWVSROLWLFDOOHDGHUVDQGGLVWULEXWHGDW WKHLUGLVFUHWLRQDQGSOHDVXUH

1HDSROLWDQ5HYLYDO

2Q 0D\ D GD\ WKH FLW\ ZLOO QHYHU IRUJHW 1DSOHV ZRQ WKH ,WDOLDQ IRRWEDOO SUHPLHUVKLS FXS ,Q WKH ORFDO WHDP KDG SXUFKDVHGDQ$UJHQWLQHDQSOD\HU'LHJR$UPDQGR0DUDGRQDZKR ZDVVRRQDGRSWHGE\WKH1HDSROLWDQVDVRQHRIWKHLURZQ.QRZQDV HOSLEHG·RUR¶WKHJROGHQIRRW· KHZDVDVSRUWVPDQRIRXWVWDQGLQJ QDWXUDO WDOHQW ZKR KDG EHJXQ OLIH DV D VFXJQL]]R LQ WKH PRVW LPSRYHULVKHGVOXPVRI%XHQRV$LUHV7KHFLW\·VJUHDWHVWSRSXODUKHUR VLQFH0DVDQLHOORKHZDVWKHSHUIHFWHPERGLPHQWRIWKHFLW\·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·VVXFFHVVWKH1HDSROLWDQVJUDGXDOO\EHJDQWR WDNHPRUHSULGHLQWKHLUFLW\ 7KH1HDSROLWDQPXVLFVFHQHZDVUHODXQFKHGE\3LQR'DQLHOHZKR WDNHVLQVSLUDWLRQIURPJHQUHVVXFKDVURFNMD]]DQGEOXHVEXWDOZD\V VLQJV LQ 1HDSROLWDQ +H PRYHG EH\RQG WKH KDFNQH\HG¶SRVWFDUG· LPDJHVRIWKHORFDOPXVLFDOWUDGLWLRQZLWKDIRQG\HWXQURPDQWLFLVHG YLVLRQRI1DSOHV,QDPRYLQJEDOODGHQWLWOHG1DSXOHqKHODVKHGRXW DJDLQVW WKH SROLWLFDO FODVV ZKR KDG PRYHG WKHLU IRFXV DZD\ IURP WKHUHDOQHHGVDQGFRQFHUQVRIUHJXODUFLWL]HQV¶1DSXOHq¶QDFDUWD VSRUFDHQLVFLXQRVHQH¶LPSRUWD·¶1DSOHVLVDSLHFHRIOLWWHUWKDWQRRQH

,17+(6+$'2:2)9(689,86

FDUHVDERXW· 3LQR'DQLHOHKDVDSSHDUHGLQFRQFHUWZLWKUHQRZQHG PXVLFLDQVVXFKDV%RE0DUOH\&DUORV6DQWDQD%RE'\ODQDQG&KLFN &RUHD+LVPXVLFLVLQWHUQDWLRQDO\HWDVKHUHDGLO\DFNQRZOHGJHV 1DSOHVVHUYHVDVKLVLQVSLUDWLRQ $OWKRXJK,DPWLHGDQGQRWRQO\LQDVHQWLPHQWDOZD\WR1DSOHV,IHHO WKDW,DPRQHFRXOGVD\XQLYHUVDOWKDWLVWRVD\WKDW,IHHOQRUHVWUDLQWV RQ P\ DUWLVWLF UHVHDUFK ZLWK UHJDUG WR FRPSDULVRQV PHHWLQJV DQG SURMHFWLRQRIFXOWXUDOLQWHUHVWIRURWKHUFOLPDWHVRWKHUUHDOLWLHV7KH WULFNLVWRUHPDLQD1HDSROLWDQLQRQH·VURRWVLQYDOXHVDQGLQVHQVHRI EHORQJLQJ\HWWREHRSHQWRQHZH[SHULHQFHVLQRQH·VDUHDRILQWHUHVW HYHQHOVHZKHUHLQWKHZRUOG

:LWKWKHIDOORIWKH%HUOLQ:DOOXQH[SHFWHGIRUFHVRIFKDQJHVZHSW WKURXJK (XURSH ,WDO\ DQG HYHQ 1DSOHV 'HSULYHG RI LWV UDWLRQDOH IROORZLQJ WKH GHPLVH RI WKH FROG ZDU WKH ,WDOLDQ SROLWLFDO V\VWHP LPSORGHGGUDPDWLFDOO\$FFXVDWLRQVRIFRUUXSWLRQQHSRWLVPLOOLFLW SDUW\ILQDQFLQJDQGOLQNVZLWKRUJDQLVHGFULPHEURXJKWGLVJUDFHRQ PRVWRIWKH1HDSROLWDQSROLWLFDOFODVVPDQ\RIZKRPZHUHKHDYLO\ LPSOLFDWHGLQMXGLFLDOLQTXLULHV)RUWKHILUVWWLPHLWZDVGHFLGHG WKDWWKHFLW\·VPD\RUZRXOGEHHOHFWHGGLUHFWO\E\WKHFLWL]HQV ,Q1RYHPEHUOHIWZLQJFDQGLGDWH$QWRQLR%DVVROLQREHFDPH PD\RUDQGLPPHGLDWHO\HPEDUNHGXSRQDSURJUDPPHRILQWHQVLYH UHIRUP%DVVROLQRERUQLQWKHWRZQRI$IUDJRODRQWKHRXWVNLUWVRI 1DSOHVSRVVHVVHGDQLQWLPDWHXQGHUVWDQGLQJRIWKHFLW\·VSUREOHPV +H EHJDQ ZLWK D PDVVLYH HIIRUW WR FOHDQ XS WKH ZDWHUIURQW DQG WKH KLVWRULF ROG WRZQ7KH VKRUHOLQH RI WKH 5LYLHUD GL &KLDLD ZDV FORVHG WR WUDIILF RQ 6XQGD\V DQG 3LD]]D GHO 3OHEHVFLWR ZKLFK WKH FDPRUUD KDG WXUQHG LQWR (XURSH·V ELJJHVW XQOLFHQVHG SDUNLQJ ORW ZDV SHGHVWULDQLVHG LQ DQ RYHUQLJKW UDLG $ VXVWDLQHG HIIRUW ZDV PDGHWRUHGXFHWKHVWUDQJOHKROGRIRUJDQLVHGFULPHDQGPDQ\RI WKHFDPRUUD·VPRVWSURPLQHQWOHDGHUVZHUHDUUHVWHG6WUHHWFULPH DQGEDJVQDWFKLQJZHUHUHGXFHG,Q-XO\WKHOHDGHUVRIWKH

,7$/,$11$3/(6

*LQGXVWULDOLVHGQDWLRQVKHOGWKHLUDQQXDOPHHWLQJLQWKHFLW\DQG DIHZPRQWKVODWHUUHSUHVHQWDWLYHVIURPFRXQWULHVJDWKHUHGDW WKH5R\DO3DODFHIRUD81FRQIHUHQFHRQLQWHUQDWLRQDOFULPH7KH FKRLFHRI1DSOHVDVDYHQXHIRUERWKKLJKSURILOHPHHWLQJVLQGLFDWHG WKDW SHUFHSWLRQV RI WKH FLW\ ZHUH EHJLQQLQJ WR FKDQJH 'XULQJ D VSHHFKDWWKH(XURSHDQ3DUOLDPHQWLQ6WUDVERXUJ%DVVROLQRSURXGO\ DQQRXQFHG¶1DSOHVLVH[SHULHQFLQJDJUHDWUHQHZDO7KHUHLVDQHZ FLW\ WKDW LV IUHHLQJ LWVHOI IURP WKH OHJDF\ RI \HDUV PDUNHG E\ WKH QHIDULRXVFRQQHFWLRQEHWZHHQSROLWLFVDQGEXVLQHVV7KHUHLVDQHZ 1DSOHVIRUZKLFKFXOWXUHLVWKHPRVWSUHFLRXVUHVRXUFH·,Q %DVVROLQRZDVUHHOHFWHGDVPD\RUE\DQRYHUZKHOPLQJPDMRULW\RI SHUFHQW 3ULGH LQ WKH FLW\ DQG D VHQVH RI FLYLF FRQVFLRXVQHVV ZHUH GHYHORSLQJ 2QH RI %DVVROLQR·V FKLHI VXSSRUWHUV ZDV HQJLQHHULQJ SURIHVVRU*LXVHSSHGL0DULDOHDGHURIDQDQWLFDPRUUDRUJDQLVDWLRQ FDOOHG 1DSROL /LEHUD ZKLFK KDG EHJXQ ZDJLQJ ZDU RQ WKH PRE LQ WKH V )ROORZLQJ WKH GHYDVWDWLRQ RI WKH HDUWKTXDNH 0LUHOOD6WDPSD%DUDFFRDQG0DXUL]LR%DUDFFRIHOWWKDWWKHRQO\ZD\ IRUZDUGIRU1DSOHVZDVWRUHFODLPWKHFLW\·VULFKFXOWXUDOKHULWDJH 7KH\HVWDEOLVKHGWKH1DSROL)RXQGDWLRQZKLFKSODFHGKLVWRULFDO PRQXPHQWV IRU DGRSWLRQ E\ PXQLFLSDO VFKRROV WKURXJKRXW ,WDO\ 6WXGHQWV ZHUH WUDLQHG DV JXLGHV OHDGLQJ SDLG WRXUV RI 1DSOHV· FUXPEOLQJ PRQXPHQWV DQG WKH PRQH\ WKH\ UDLVHG LQ IHHV ZDV DSSOLHGWRDQH[WHQVLYHUHVWRUDWLRQHIIRUW$IWHU\HDUVKLGGHQIURP YLHZVRPHRIWKHFLW\·VJUHDWHVWWUHDVXUHVZHUHRSHQHGWRWKHSXEOLF LQWKHDQQXDO0DJJLRGHLPRQXPHQWLLQLWLDWLYHVKHOGHYHU\VSULQJ,Q WKHILUVW\HDUSHRSOHVLJQHGXSIRUWRXUVDQGE\KDOID PLOOLRQWLFNHWVKDGEHHQVROGQRWRQO\WRUHVLGHQWVRI1DSOHVEXW DOVRWRWKHJURZLQJQXPEHUVRIFXOWXUHYXOWXUHVIURPWKURXJKRXW ,WDO\ZKRIORFNHGWRWKHHYHQW 2QFH DJDLQ WKH DUWV EHJDQ WR IORXULVK LQ 1DSOHV ,Q WKH

,17+(6+$'2:2)9(689,86

&DSRGLPRQWH PXVHXP KHOG DQ H[KLELW HQWLWOHG ¶9HVXYLXV E\ :DUKRO·7KHSURPLQHQW$PHULFDQDUWLVWSURGXFHGSDLQWLQJVDQG QXPHURXVSULQWVIRUWKHRFFDVLRQ:DUKRO·VSRUWUDLWVRIWKHYROFDQR DUHDWHVWDPHQWWRKLVSDVVLRQIRU1DSOHVDQGWKHDSSOLFDWLRQRIWKH FLW\·VXOWLPDWHV\PEROWRKLVRZQFRQFHSWVRIPDVVFRPPXQLFDWLRQ DQG VHULDO UHSURGXFWLRQ:DUKRO XQGHUVWRRG WKDW9HVXYLXV ZDV WR 1DSOHVZKDWWKH(PSLUH6WDWH%XLOGLQJZDVWRKLVFLW\²DSRWHQW FRPELQDWLRQ RI P\WK DQG UHDOLW\ 6HYHUDO DZDUGZLQQLQJ ILOPV E\ ,WDOLDQGLUHFWRU/LQD:HUWPXOOHUZHUHVHWLQWKHFLW\LQFOXGLQJ&LDR SURIHVVRUHWKHWDOHRIDSULPDU\VFKRROWHDFKHUIURP1RUWKHUQ,WDO\ ZKRLVVKRFNHGE\WKHKDUVKVRFLDODQGHGXFDWLRQDOUHDOLWLHVRIWKH GLVDGYDQWDJHGVXEXUEVRI1DSOHVEDVHGRQDQ,WDOLDQEHVWVHOOHUDERXW WKHWUXHH[SHULHQFHVRIDWHDFKHUIURP1RUWKHUQ,WDO\ZRUNLQJLQ DORFDOVFKRRO DQG)UDQFHVFDH1XQ]LDWDEDVHGRQWKHHSRQ\PRXV QRYHOE\0DULD2UVLQL1DWDOH VWDUULQJ6RSKLD/RUHQVHWDWWKHWXUQ RI WKH ODVW FHQWXU\:HUWPXOOHU·V PRYLHV GHPRQVWUDWH KHU ORYH RI 1DSOHVDQGKHUXQGHUVWDQGLQJRIWKHKXPDQLW\RIWKH1HDSROLWDQV 7KH WDOHQWHG FRPLF DFWRU 0DVVLPR7URLVL VWDUUHG LQ VHYHUDO ILOPV WKURXJKRXWWKHVDQGVDOZD\VLQWKHUROHRIDWLPLGDQG WKRXJKWIXO1HDSROLWDQDQWLKHUR7UDJLFDOO\KHGLHGLQRQWKH ILQDO GD\ RI ILOPLQJ RI ,O SRVWLQR WKH URPDQWLFLVHG WDOH RI &KLOHDQ 1REHOSUL]HZLQQHU3DEOR1HUXGD·VVWD\RQWKHLVODQGRI3URFLGD WRRVRRQWRVHHLWQRPLQDWHGIRUILYH$FDGHP\$ZDUGV 6LQFHWKHHDUWKTXDNHWKHFLW\·VDSSHDUDQFHKDVFKDQJHGVRPHZKDW $JURXSRIVN\VFUDSHUVNQRZQDVWKH&HQWURGLUH]LRQDOHKDVRSHQHG SURYLGLQJPXFKQHHGHGRIILFHVSDFHQHDUWKHFHQWUDOWUDLQVWDWLRQ $IWHU H[WHQVLYH OREE\LQJ E\ HQYLURQPHQWDO LQWHUHVW JURXSV WKH XQVLJKWO\ ,WDOVLGHU IDFWRU\ LQ WKH VWXQQLQJ QDWXUDO VHWWLQJ RI WKH %DJQROLZDWHUIURQWZDVGLVPDQWOHGDQGKDVQRZEHHQUHSODFHGE\ DVFLHQFHPXVHXP7KHDUHDDURXQGWKHYROFDQRKDVEHHQJLYHQWKH VWDWXVRIDQDWLRQDOSDUNDQG(XURSHDQUHJLRQDOGHYHORSPHQWIXQGV

,7$/,$11$3/(6

KDYHEHHQHPSOR\HGWREXLOGWKHXOWUDPRGHUQPHWURV\VWHP9LD 7ROHGRKDVEHHQSDUWLDOO\SHGHVWULDQLVHG7KHORFDOHFRQRP\LVVWLOO IUDJLOHEXWWKHFLW\LVDFWLYHO\VHHNLQJWREHFRPHDFHQWUHIRUFXOWXUDO SURGXFWLRQDQGFXOWXUDOWRXULVP9DULRXVLQLWLDWLYHVUHVRXUFHVDQG WKH LQQDWH FUHDWLYLW\ RI WKH 1HDSROLWDQV DUH PDNLQJ LW SRVVLEOH WR SURPRWHWKHFLW\DVRQHRIWKHZRUOG·VDUWFDSLWDOV $OWKRXJKWKHFDPRUUDKDVEHHQGDPDJHGLWLVIDUIURPHOLPLQDWHG DQGPDQ\RIWKHVWUXFWXUDOZHDNQHVVHVWKDWKDYHEXUGHQHG1HDSROLWDQ KLVWRU\VXFKDVWKHLQDGHTXDF\RIWKHFLW\·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·VFXOWXUDOUHQHZDOWKHGRRUWR WKHSDODFHZDVV\PEROLFDOO\UHRSHQHGLQWRDOORZWKHHQWUDQFH RI SKLORVRSKHU +DQV*HRUJ *DGDPHU D VWDXQFK VXSSRUWHU RI WKH LQVWLWXWH·VDFWLYLWLHVWRJHWKHUZLWK0D\RU%DVVROLQR7KRVHZKRORYH 1DSOHVFDQRQO\DZDLWZLWKH[SHFWDWLRQWKHGD\ZKHQWKHGRRUZLOO EHRSHQHGSHUPDQHQWO\

$33(1',;,

1 ( $ 3 2 / , 7 $ 1 0 21$5&+6

1RUPDQ+DXWHYLOOH '\QDVW\

5RJHU :LOOLDP,WKH%DG :LOOLDP,,WKH*RRG 7DQFUHGL :LOOLDP,,,

² ² ² ²

6ZHELDQ+RKHQVWDXIHQ '\QDVW\

+HQU\9,.LQJRI*HUPDQ\ DQG+RO\5RPDQ(PSHURU .LQJRI1DSOHVDQG6LFLO\ )UHGHULFN,, &RUUDGR,9 0DQIUHG

² ² ² ²

IDFLQJSDJH 6DQ*UHJRULR$UPHQR

,17+(6+$'2:2)9(689,86

$QJHYLQ'\QDV W\

&KDUOHV, &KDUOHV,, 5REHUWWKH:LVH -RDQ, &KDUOHV,,, /DGLVODXV -RDQ,, 5HQp

² ² ² ² ² ² ² ² $UDJRQHVH'\QDVW\

$OSKRQVH, )HUUDQWH $OSKRQVH,, )HUUDQWLQR )UHGHULFN

² ² ² ² ²

)URPWR1DSOHVZDVJRYHUQHGE\6SDQLVKYLFHUR\VDQGLWZDV JRYHUQHGE\$XVWULDQYLFHUR\VIURPWR %RXUERQ'\QDVW\

&KDUOHV9,, )HUGLQDQG,9DQG, )UDQFLV, )HUGLQDQG,, )UDQFLV,,

² ² ² ² ²

$33(1',;,,

/ $ 60 2 5 ) , $ 1 $32/(7$1$

/·,WDOLD $SLFFHUHOOD $JDWWD 2SXRUFR $PDQD &KHOODFKHJXDUGDQWHUUD 2YDVHWWR $0DURQQD $)LJOLDWD (IDVXOH (VXULFH (VXUGDWH 6DQW·$QWRQLR 2PEULDFR 2JXDJOLRQH 2FXOR $GLVJUD]]LD

,WDO\ 7KHOLWWOHJLUO 7KHFDW 7KHSLJ 7KHKDQG 7KHRQHZKRORRNVGRZQZDUGV IHPDOHJHQLWDOLD 7KHSRW 2XU/DG\ 2IIVSULQJ 7KHEHDQV 7KHPLFH 7KHVROGLHUV 6DLQW$QWKRQ\ 7KHGUXQN 7KHER\ 7KHERWWRP %DGOXFN

,17+(6+$'2:2)9(689,86

2VDQJKH $UHVDWD $IHVWD $IHPPHQDDQQXUD 2SD]]R 2WHUUDPRWR (JJXDUGLH 1DWDOH 1DQQLQHOOD 2FDQWHUR (]]L]]H 2SDWHG·HFFULDWXUH (SSDOOHG·RWHQHQWH 2SDWURQHHFDVD 2FDSLWRQH //·DQQHH&ULVWR $FDSD $XFHOOX]] (FDVWDJQHOOH 20RQDFR (PD]]DWH $IXQDQ·JDQQD $SDSRVFLD 2FXUWLHOOR 2FFDIp 2QQD3HUHWDIRUH REDOFRQH (FFDQFHOOH 2YLQREXRQR (GHQDUH

7KHEORRG /DXJKWHU 7KHIHDVW 7KHQDNHGZRPDQ 7KHPDGPDQ 7KHHDUWKTXDNH 7KHFRSV &KULVWPDV /LWWOH$QQLH 7KHEHGSDQ 7KHWLWV 7KHIDWKHURIFKLOGUHQ PDOHPHPEHU 7KHOLHXWHQDQW·VEDOOVWHVWLFOHV 7KHODQGORUG 7KHHHOPDOHPHPEHU &KULVW·VDJH 7KHKHDG 7KHELUGPDOHPHPEHU &DVWDQHWVWHVWLFOHV 7KHPRQN +LWWLQJ $WJXQSRLQW 5XSWXUH" 7KHNQLIH &RIIHH 'RQQD3HUHWDRQKHUEDOFRQ\ -DLO *RRGZLQH 0RQH\

/$6025),$1$32/ (7$1$

2PXRUWR 2PXRUWRFKHSSDUOD 2SLH]]RHFDUQH 2SSDQH 2FLDUGLQR $0DPPD 2YLHFFKLR 2FDSSLHOOR $PXVHFD $FDUXWD 2FDUWHOODWR 2SDFFRWWR (SLOH 6HODPHQWD 2FDFFLDWRUH 2PXRUWRDFFLVR $VSRVD $VFLDPPHULD 2FKLDQWR (GGRLH]HWHOOH 27RWDURLQW·DFKLWDUUD $]XSSDFRWWD 6RWW·HQFRSSD 2SDOD]]R /·RPPRHPHUGD $PHUDYLJOLD 2VSLWDOH $URWWD 3XOOHFHQHOOD $IXQWDQD

7KHGHDGPDQ 7KHGHDGPDQZKRVSHDNV )OHVK 7KHEUHDG 7KHFRXUW\DUG 7KHPRWKHU 7KHROGPDQ 7KHKDW 7KHPXVLF 7KHIDOO 7KHKXQFKEDFN 7KHEXQGOH 7KHKDLU 7KHFRPSODLQHU 7KHKXQWHU 7KHPXUGHUHGPDQ 7KHEULGH 7KHFRDW :HHSLQJ 7KH7ZR2OG0DLGV 7KHVTXLGLQWKHJXLWDU VH[XDOLQWHUFRXUVH :DUP6RXS 8SVLGHGRZQ 7KHDSDUWPHQWEORFN 7KHVKLWW\PDQ $VWRQLVKPHQW 7KHKRVSLWDO 7KHFDYH 3XOFLQHOOD 7KHIRXQWDLQ

,17+(6+$'2:2)9(689,86

(ULDYXOH $EHOODILJOLROD 2PDLXROR $YRFFD (VFLXUH $WDYXODPEDQGLWD 2PDOHWLHPSR $FFKLHVD /·DQHPHRSULDWRULR $SXWHFD (SHUXFFKLH (FDVHFDYDOOH $YHFFKLD $SDXUD

7KHGHYLOV 7KHELWFKEHDXWLIXOZRPDQ 7KHWKLHI 7KHPRXWK 7KHIORZHUV 7KHWDEOHVHWZLWKSODWHVDQGIRRG %DGZHDWKHU 7KHFKXUFK 7KHVRXOVRISXUJDWRU\ 7KHSKDUPDF\ /LFH &KHHVHV 7KHROGODG\ )HDU

1 ( $ 3 2 / , 7 $ 1 +,6725< $1( 6 6 ( 1 7 , $ / % , % / , 2 * 5 $ 3 + <

$UFKLYLR 1DSROL >YDULRXV FRQWULEXWRUV@ YROXPHV $UH]]R (GL]LRQL $UFKLYLR 6WRULD GL 1DSROL >YDULRXV FRQWULEXWRUV@ YROXPHV 1DSOHV 6RFLHWj HGLWULFH6WRULDGL1DSROL² +DUROG$FWRQ 7KH /DVW %RXUERQV RI 1DSOHV ² 1HZ

,17+(6+$'2:2)9(689,86

&DUOR'H)UHGH6WRULDHSRHVLDGHLGROFLD1DSROL1DSOHV5LFHUFKHH6WXGL GL6WRULD &HVDUH 'H 6HWD 6WRULD GHOOD FLWWj GL 1DSROL ² GDOOH RULJLQL DO 6HWWHFHQWR 5RPH%DUL/DWHU]D *LXVHSSH*DODVVR,QWHUYLVWDVXOODVWRULDGL1DSROLHG3HUF\$OOXP%DUL /DWHU]D *LXVHSSH*DODVVR/·DOWUD(XURSD3HUXQ·DQWURSRORJLDVWRULFDGHO0H]]RJLRUQR G·,WDOLD0LODQ0RQGDWRUL (WWRUH*DOOR,O*UDQ0DJLVWHURGHO6DFUR0LOLWDUH2UGLQH&RQVWDQWLQLDQRGL 6DQ*LRUJLR5RPD,O0LQRWDXUR $QWRQLR*LUHOOL6WRULDGL1DSROL7XULQ(LQDXGL 9LWWRULR*OHLMHVHV/DVWRULDGL1DSROL1DSOHV(GL]LRQLGHO*LJOLR 1LQR/HRQH1DSROLDL7HPSLGL0DVDQLHOOR0LODQR%LEOLRWHFD8QLYHUVDOH 5L]]ROL 1RUPDQ/HZLV1DSOHV¶$Q,QWHOOLJHQFH2IÀFHULQWKH,WDOLDQ/DE\ULQWK /RQGRQ:LOOLDP&ROOLQV $XUHOLR0XVL/DULYROWDGL0DVDQLHOORQHOODVFHQDSROLWLFDEDURFFD1DSROL *XLGD 0DULR1DSROL1DSROL*UHFR5RPDQR1DSROL 'LHWHU 5LFKHWHU 1DSROL FRVPRSROLWD 9LDJJLDWRUL H FRPXQLWj VWUDQLHUH QHOO·2WWRFHQWR1DSROL(OHFWD 55RPDQR'DO9LFHUHJQRDO5HJQR6WRULDHFRQRPLFD7XULQ(LQDXGL -RKQ 6DQWRUH 0RGHUQ 1DSOHV $ 'RFXPHQWDU\ +LVWRU\ ² 1HZ
,1'(; $EUX]]R $FFDGHPLDGHJOL$UGHQWL $FFDGHPLDGHJOL,QFRJQLWL $FFDGHPLDGHJOL2]LRVL $FFDGHPLD(UFRODQHVH $FFDGHPLD1DSROHWDQD $FHUUD $FWRQ$GPLUDO-RKQ $GULDQ)DWKHU² $IUDJROD $JDOLVLDQXUVH $JULSSLQR6DLQW $OEHUJR3DJDQR $OEHUWR'RQ $OEHUWR3ULQFH $OERLQ.LQJ $OH[DQGULD $OID5RPHRIDFWRU\² $OID6XGIDFWRU\ $OOLHG)RUFHV6RXWKHUQ(XURSH $6)287+ $OOXP3HUF\ $OSKRQVHRI$UDJRQ$OSKRQVHWKH 0DJQDQLPRXV ² $OSKRQVH'XNHRI&DODEULD $OSKRQVH,,.LQJ² $OSKRQVHRI1DSOHV $OSKRQVXV6DLQWVHH/LJXRUL$OSKRQVH $OYDUH]GH7ROHGR'RQ3HGUR² $PDOIL² $QGHUVHQ+DQV&KULVWLDQ $QGUHZRI+XQJDU\ $QGUHZ6DLQW

$QJHYLQV² $QJLRLQR0DVFKLR $QJXLDU/XFUH]LDOD%DVWDUGHOOD $QLHOOR7RPPDVR0DVDQLHOOR ² $QQH6DLQW $QWLRFK $SHQQLQHV $SKURGLWH $SXOLD $TXDULXP $TXLQDV7KRPDV² $UDEV $UDJRQHVH1DSOHVDUFKLWHFWXUHLQ² ²DUULYDORISULQWLQJLQDUWDQG FXOWXUHLQ²²HOLPLQDWLRQ RIUHEHOQREOHVLQ²JXLOGV HVWDEOLVKHGLQPXVLFLQ²DV SLRXVFLW\²²SROLWLFDOXQUHVW LQ²DVWUDGLQJFHQWUH² $UFDGLD² $UFKDHRORJLFDO0XVHXP $UH]]R*XLGRG· $ULVWRWOH $VLD0LQRU $WHOOD $WKHQV $XGHQ:+ $XJXVWXV(PSHURU² $YHUURsV $YHUVD*LDPPDWWHRG· $YHUVDWRZQ $YLFHQQD

,17+(6+$'2:2)9(689,86

%DFFR(QULRF %DLD² %DOHDULF,VODQGV %DQFR$YH*UDWLD3OHQD %DQFRGHO6DQWLVVLPR6DOYDWRUH %DQFRGHOOR6SLULWR6DQWR %DQFRGL6DQWD0DULDGHO3RSROR %DQGLQL)UDQFHVFR %DQNRI1DSOHV %DUDFFR0DXUL]LR %DUDFFR0LUHOOD6WDPSD %DUEDMD'RPHQLFR %DUFHORQD %DVLO'XNHRI1DSOHV %DVLOH*LDPEDWWLVWD %DVVROLQR$QWRQLR² %DWWLVWHOORVHH&DUDFFLROR%DWWLVWHOOR %DWWOHRIWKH1LOH %D\RI1DSOHV %HDWULFH3ULQFHVV² %HDWULFH4XHHQ %HFFDGHOOL$QWRQLRLO3DQRUPLWD %HGH9HQHUDEOH %HOLVDULXV %HOOLQL9LQFHQ]R %HQHGLFW6DLQW %HQHGLFWLQHV² %HQHYHQWR %HQHYHQWR%DWWOHRI %HQLQFDVD6LVWHU2UVROD %HQMDPLQ:DOWHU %HQQHWW7RQ\ %HUOLQ:DOO %HUQLQL*LDQ/RUHQ]R² %ODFN'HDWK %OHVVLQJWRQ/DG\ %ORLV7UHDWLHVRI %RFFDFFLR*LRYDQQL² %RQDSDUWH&DUROLQH² %RUHOOL'RQ0DULR² %RWDQLFDO*DUGHQV

%RXFKDUG-HDQ-DFTXHV %RXUERQ1DSOHVDGPLQLVWUDWLRQRI ²DQWLFOHULFDOLVPRI² DUFKDHRORJ\LQ²DUFKLWHFWXUH LQ²DUWDQGFXOWXUH LQ LQ²²²FXFFDJQD ²DQG(PPD+DPLOWRQ² )UHQFKKHJHPRQ\LQ²KRWHOV LQLQGXVWULDODFKLHYHPHQWVRI ²DQG,WDOLDQXQLILFDWLRQ² DQGWKH-DFRELQV²OD]]DURQLRI ²ORWWHU\HVWDEOLVKHGLQ PXVLFLQ²²RSXOHQFH DQGSRYHUW\RI²DVSDUWRIWKH *UDQG7RXU²DV3DUWKHQRSHDQ 5HSXEOLF²SLHW\RI² UHVWRUDWLRQRIWKH%RXUERQVLQ ²DQGWKH5LVRUJLPHQWR² VHFUHWVRFLHWLHVLQWKHDWUHVLQ DVWRXULVWDWWUDFWLRQ²WUDGHDQG FRPPHUFHLQ² %RXUERQVFKLYDOULFRUGHURI %UDKPV-RKDQQHV %UDQFDFFLR&DUGLQDO %UHLWEDFN'LHWULFK %ULGJHW6DLQW %ULWLVK0XVHXP/RQGRQ %URRNV-DFN %URVFKL&DUOR)DULQHOOL ² %URWKHUV*ULPP %UXQR*LRUGDQR %UXWXV %XHQ5HWLURSDODFH6SDLQ ² %XOZHU/\WWRQ(GZDUG %\]DQWLQH1DSOHVEDWWOHVIRUFRQWURORYHU ²WKH&KXUFKLQ²IHPDOHVDLQWV RI²LPSRUWDQFHRIDV/RPEDUG SRVVHVVLRQ²SURVSHULW\RI² %\]DQWLXPVHH&RQVWDQWLQRSOH &DHFLOLXV-XFXQGXV &DIp*DPEULQXV²

,1'(;

&DODEULD &DOWDEHOODWDSHDFHRI &DPDLQR7LQRGD &DPSDQHOOD7RPPDVR² &DPSDQLD &DQRYD$QWRQLR &DQWHUEXU\ &DSH0LVHQXP &DSRGLPRQWH &DSRGLPRQWHPXVHXP &DSUL² ² &DSUL3HSSLQRGL &DSXD%DUWKRORPHZGL &DSXD(GXDUGRGL &DSXDSODFH &DSXFKLQV &DUDFFL$QQLEDOH &DUDFFLROR$GPLUDO)UDQFHVFR² &DUDFFLROR%DWWLVWHOOR &DUDIDGL0DGGDORQL'LRPHGH &DUDID*LRYDQQL'XNHRI1ROD &DUDID7LEHULR &DUDYDJJLR0LFKHODQJHOR0HULVLGD &DUERQDUL &DUQH\$GPLUDO5REHUW &DURVRQH5HQDWR &DUSLR0DUFKHVHGHO &DUUDFLROR$QQLEDOH &DUWKDJH &DUWKXVLD&KDUWHUKRXVH SHUIXPH² &DUXVR(QULFR² &DVDQRYD*LDFRPR &DVWHO&DSXDQD &DVWHOGHO0RQWH$SXOLD &DVWHOOL3LHWUR &DWDORQLD &DWKROLF&KXUFK²² &DWRQH$QJHOR &D\OXV&RXQWGH &HOHVWLQH93RSH

&HUYDQWHV0LJXHOGH &HVDULXVJHQHUDO &KDUOHVRI'XUD]]R &KDUOHV,.LQJRI+XQJDU\ &KDUOHV,.LQJRI6LFLO\² &KDUOHV,,.LQJRI6LFLO\² &KDUOHV,,.LQJRI6SDLQ &KDUOHV,9.LQJRI1DSOHV²² ² &KDUOHV0DUWHO$QMRX &KDUOHVVRQRI6DLQW%ULGJHW &KDUOHV9(PSHURU &KDUOHV9RI+DEVEXUJ &KDUOHV9,(PSHURU &KDUOHV9,,,.LQJRI)UDQFH² &KDUORWWH4XHHQ² &KDUORWWHQEHUJFDVWOH &KDUWHUKRXVHRI6DLQW0DUWLQ &KDWHDXEULDQG)UDQoRLV5HQp² &KLQHVH&ROOHJH &KULVWLDQV&KULVWLDQLW\² &LFFRQH$QGUHD &LFHUR &LOHD)UDQFHVFR &LPDURVD'RPHQLFR &LUFH² &LULOOR'RPHQLFR &LUR6DLQW &LYLWDYHFFKLD &ODUN*HRUJH6LGQH\ &ODUN/LHXWHQDQW*HQHUDO0DUN &ODXGLXV(PSHURU &OHPHQW9,3RSH &OHPHQW;,,3RSH &OHPHQWLQD0DULD &ROEUDQ,VDEHOOD &RORQQD&DUGLQDO3RPSHR &RPR3HUU\ &RQJUHJDWLRQRIWKH0RVW+RO\&RQFHSWLRQ RI0DU\ &RQJUHVVRI9LHQQD

,17+(6+$'2:2)9(689,86

&RQUDGLQ3ULQFHRI6LFLO\ &RQVWDQFHRI$OWDYLOOD &RQVWDQFH4XHHQ &RQVWDQFH6DLQW &RQVWDQV,,(PSHURU &RQVWDQWLQH(PSHURU &RQVWDQWLQRSOH &RQWL*LRFFKLQ*L]]LHOOR &RQYHUVLQL*LRYDQQL &RSSROD)UDQFLV)RUG &RUGRED&RQVDOYRGH² &RUHD&KLFN &RUHQ]LR%HOLVDULR &RUVLFD &RVWR7RPPDVR &RXQFLORI7UHQW &RXQWHU5HIRUPDWLRQ² &UHVFHQ]R/XFLDQRGH &URFH%HQHGHWWR² &XPD &XPDH &XPHDQ6\ELO² &XRFR9LFHQ]R 'DPH7URW 'DQLHOH3LQR² G·$QQXQ]LR*DEULHOH 'DQWH$OLJKLHUL 'DUZLQ&KDUOHV 'H)UHGH&DUOR 'H0DWWHLV 'H6DQFWLV)UDQFHVFR 'H6LFD9LWWRULD² GHOOD3RUWD*LRYDQQL%DWWLVWD 'HPHWHU 'HQ]D/XLJL 'HSUHWLV$JRVWLQR 'HVFDUWHV5HQp 'LD]$UPDQGR 'LFNHQV&KDUOHV 'LFNLQVRQHPLO\ 'LRFOHWLDQ(PSHURU

'LRQ\VLXV 'RKUQ$QWRQ 'RPHQLFKLQR'RPHQLFR=DPSLHUL 'RPLQLFDQV 'RQ&DUORVRI%RXUERQVHH&KDUOHV,9.LQJ RI1DSOHV 'RQL]HWWL*DHWDQR² 'RXJODV/RUG$OIUHG 'UHQJRW5DLQROIR 'XFK\RI1DSOHV²$UDELQIOXHQFHV FXOWXUDOLQVWLWXWLRQVLQ²PDULWLPH FRPPHUFH²SURVSHULW\RI² WHQVLRQVZLWKWKH/RPEDUGVWLHVWR 5RPHDQG9LUJLO·VHJJ 'XPDVSqUH$OH[DQGUH 'XWFK(DVW,QGLDFRPSDQ\ '\ODQ%RE (DVWHUQ(PSLUH (GLFWRI0LODQ$' (JJ&DVWOH (J\SW (OED (QOLJKWHQPHQW² (SLFXUXV(SLFXUHDQV (VFRULDO6SDLQ ² (VSRVLWR5DIIDHOH (VSRVLWR6DOYDWRUH (VWH(OHRQRUDG· (WQD0W (WUXVFDQV (XVHELD (YHO\Q-RKQ )DEULV3LHWUR )DQ]DJR&RVLPR )DULQHOOLVHH%URVFKL&DUOR )DUQHVH(OL]DEHWK )DVFLVP² )HUGLQDQGRI$UDJRQ )HUGLQDQG,.LQJRI1DSOHV² ²

,1'(;

)HUGLQDQG,,.LQJRI1DSOHV )HUUDQWH.LQJ² )HUUDUD )HUUHQWH,,.LQJ)HUUDQGLQR )LDPPHWWD² )LERQDFFL/HRQDUGR )LODJLHUL*DHWDQR )LOLSSR(GRDUGRGH )LRULOOR6LOYLR )LRULOOR7LEHULR² )LUVW:RUOG:DU² )ORUHQFH )RQWDQD'RPHQLFR )UDQFLVRI$VVLVL6DLQW )UDQFLV,,.LQJRI1DSOHV²² )UDQFLVRI/RUUDLQH )UDQNOLQ%HQMDPLQ )UHGHULFN,,RI+RKHQVWDXIHQ² )UHGHULFN,,,.LQJ )UHQFK5HYROXWLRQ² )UHXG6LJPXQG )ULHGULFK:LOKHOP,9.LQJRI3UXVVLD )XJD)HUGLQDQGR *DEULHOOL&DWHULQDOD&RFKHWWD *DHWD *DOLDQL)HUGLQDQGR *DOLOHR*DOLOHL *DOOHULD3ULQFLSHGL1DSROL *DOOHULD8PEHUWR, *DOOLDQR$OHVVDQGUR² *DPEDFRUWD*DHWDQR3ULQFHRI0DFFKLD *DUHWK%HQHGHWWRLO&DUHWHR ² *DULEDOGL*LXVHSSH² *D\2GLQFKRFRODWHIDFWRU\ *HQQDUR6DQ² ² *HQRD *HQRYHVL$QWRQLR *HURODPLQLRUGHU

*HV1XRYRFKXUFK *HVXDOGR&DUOR3ULQFHRI9HQRVD *HWW\-RKQ3DXO -3DXO*HWW\0XVHXP/RV$QJHOHV *KLEHOOLQHV *LDFRPR6DOYDWRUHGL *LDQQLQL(WWRUH *LDQQRQH3LHWUR² *LJDQWH*LDFLQWR *LJOL%HQLDPLQR *LRLD)ODYLR *LRUGDQR/XFD *LRUGDQR8PEHUWR *LRWWRGL%RQGRQH² *LXOLDQR/XLJL *RHWKH-RKDQQ:ROIJDQJYRQ² *RQ]DJD9LQFHQ]R'XNHRI0DQWXD *RUN\0D[LP *RWKV *UDJQDQV *UDQDGD *UDQG7RXU²² *UDWLOGD *UDYLQD*LDQ9LQFHQ]R² *UHHN1HDSROLVDUFKLWHFWXUHLQ² HGXFDWLRQDQGOHDUQLQJLQ² IRXQGDWLRQRI²ORFDWLRQ² UHOLJLRXVSUDFWLFHLQ² *UHYLOOH&KDUOHV *URWLXV+XJR *XHOSKV² +DEVEXUJV² +DFNHUW-DNRE3KLOLS +DFNHUW3KLOLS +DPLOWRQ(PPD² +DPLOWRQ6LU:LOOLDP² ² +D\GQ-RVHSK +HUFXODQHXP²²

,17+(6+$'2:2)9(689,86

+HUOLQJ*XVWDY +HWILHOG&RXQFLORI +LSSRGDPXVRI0LOHWXV +LWOHU$GROI +RKHQORKH&DUGLQDO*XVWDY +RO\5RPDQ(PSLUH² +RPHU² +RUDFH +RVSLWDOIRU,QFXUDEOHV +XPDQLVP² +XQJDU\

-DFRE6DLQW -DFRELQV -DPHV+HQU\ -DQXDULXV6DLQWVHH*HQQDUR6DLQW -HQVHQ:LOKHOP -HVXLWV -RDQ,,$QMRX'XUD]]R² -RDQ4XHHQGLVRUGHUHGOLIHRI²² -RKQRI$QMRX -RKQWKH%DSWLVW6DLQW -RKQ,9'XNH -RKQ3DXO,,3RSH -RKQ3ULQFH -RKQVRQRI$OSKRQVHWKH0DJQDQLPRXV -ROL$QWRQLR -RVHSK,(PSHURURI$XVWULD² -RVHSK,.LQJRI6SDLQ -RVHSK6DLQW -XOLXV&DHVDU -XVWLQLDQ(PSHURU

,OYD,WDOVLGHU VWHHOZRUNV ,PEULDQL9LWWRULR ,PSHUDWR)HUUDQWH ,QJUHV-HDQ$XJXVWH² ,QVWLWXWHIRU&RPEXVWLRQUHVHDUFK ,VDEHOODRI&DVWLOOH ,VFKLD ,WDOLDQ,QVWLWXWHIRU+LVWRULFDO5HVHDUFK ,WDOLDQ,QVWLWXWHIRU3KLORVRSKLFDO5HVHDUFK ² ,WDOLDQ1DSOHVDQGWKH$PHULFDQV .DQJ[L(PSHURU ²DUFKLWHFWXUHLQDUWDQG .DXIPDQQ$QJHOLFD FXOWXUHLQ²DWDQGFXOWXUHLQ .LQJGRPRI,WDO\ ²FDPRUUDLQ .LQJGRPRIWKH7ZR6LFLOLHV FKROHUDLQ² FLQHPDWLFWUDGLWLRQLQ²FRIIHH .UXSS)ULHGULFK$OIUHG DQGFDNHLQ²FULPHLQ ODEHOOD$GULDQDVLQJHU ² ²GLVWUXVWVXVSLFLRQRI /D&DSULD5DIIDHOH ²HDUWKTXDNHLQ /D0RUWHOOD HFRQRPLFVWDJQDWLRQDQGSRYHUW\LQ ²²HPLJUDQWVIURP /DFFR$PHQR /DGLHVRI6DOHUQR ²²DQGIDVFLVWUXOH /DGLVODXVRI'XUD]]R² ²PXVLFLQ²² ²1HDSROLWDQUHYLYDOLQ² /DNH$YHUQXV SLHW\LQ²DQGWKHSL]]D² /DPDUWLQH$OSKRQVH0DULH/RXLVGH SRVWZDUGLIILFXFOWLHV²² /DXUR$FKLOOH UHEXLOGLQJRI²WRXULVWVLQ² /D]DUXV6DLQW ²WZHQWLHWKFHQWXU\² /H*DLROH /HQWLQL*LDFRPRGD DQG:RUOG:DUV²² /HR;,,,3RSH

,1'(;

/HRQFDYDOOR5XJJLHUR /HRSDUGL*LDFRPR /HZLV1RUPDQ /LJXRUL$OSKRQVH² /LJXULD² /LYRUQR /LY\² /RPEDUGV² /RQJR%DUWROR² /RQJR0DULD/RUHQ]D /RSHGH9HJD /RUHQ6RSKLD² /RUHWR6FKRROV /RXLVRI$QMRX /RXLVWKHIULDU /RXLV,.LQJRI)UDQFH /RXLV,,.LQJRI)UDQFH /RXLV.LQJRI+XQJDU\ /RXLVRI7DUDQWR /RXLV;,,.LQJRI)UDQFH /RXYUH0XVHXP3DULV /RZH*HQHUDO+XGVRQ /XFUHWLXV² /XFXOOXV 0DFFKLD&RQVSLUDF\ 0DGRQQDGHOO·$UFR 0DGRQQDRIWKH5RVDU\ 0DGRQQDRIWKH6RXOVLQ3XUJDWRU\&KXUFK RI² 0DGULG² 0DJJL*LXVHSSH 0DLXUL$PHGHR 0DMRUDQR*DHWDQR&DIIDUHOOL 0DODSDUWH&XU]LR 0DQIUHG 0DQQ7KRPDV 0DUDGRQD'LHJR$UPDQGR 0DUJDULWDRI'XUD]]R 0DUJKHULWD4XHHQRI6DYR\ 0DULD$PDOLD4XHHQ 0DULD&DUROLQD4XHHQRI1DSOHV

0DULDGDXJKWHURI.LQJ)HUUDQWH ² 0DULD*LXVHSSHGL 0DULDRI+XQJDU\ 0DULD,QFRURQDWD&KXUFKRI 0DULD/RXLVDRI+DEVEXUJ 0DULD6RSKLD4XHHQ 0DULD7KHUHVD(PSUHVV 0DULH$QWRLQHWWH4XHHQ 0DULQHOOD 0DULQR*LDPEDWWLVWD 0DUOH\%RE 0DURWWD*LXVHSSH 0DUWLQ'HDQ 0DUWLQL6LPRQH 0DUWLQLF&RXQW*LURJLR] 0DVDQLHOORVHH$QLHOOR7RPPDVR 0DVFDJQL3LHWUR 0DVFKLR$QJLRLQR ² 0DVWURLDQQL0DUFHOOR 0DWLOGDRI+DLQDXOW3ULQFHVV 0DWXUL$PHGHR 0D\U 0D]]RQL*XLGR 0HGLWHUUDQHDQ 0HJDULGH 0HJDULV 0HLVVHQIDFWRU\ 0HOLVV*HRUJH-XOLXV 0HOSRPHQH 0HQGHOVVRKQ)HOL[ 0HUFDOOL*LXVHSSH 0HUJHOOLQD 0HULVL0LFKHODQJHOR 0HUROD0DULR 0HWDVWDVLR3LHWUR² 0LFKDHO6DLQW² 0LJOLDFFLR/XFLD'XFKHVVRI)ORULGLDQD 0LODQ

,17+(6+$'2:2)9(689,86

0LOOHU/DG\$QQH² 0LOOLJDQ6SLNH 0LVHQR 0RQWH&DVVLQR 0RQWH2OLYHUWR 0RQWHUUH\&RXQWRI 0RQWHYHUJLQH&KXUFKRI%HQHYHQWR 0RRUH'U 0RRUHKHDG$ODQ 0RRUV 0RUDQWH(OVD 0RUDYLD$OEHUWR 0RUJDQ/DG\ 0RVFDUHOOD(QQLR 0RVWUDGHOOD7HUUDG·2OWUHPDUH 0R]DUW:ROIJDQJ$PDGHXV 0XQWKH'U$[HO² 0XUDW-RDFKLP²² 0XUJHKLOOV 0XUROR5REHUWR 0XVVROLQL%HQLWR 0XVXPRI3DODHRQWRORJ\ P\WKV² 1DSLHU/RUG 1DSOHVDQG$QJHYLQPRQDUFK\² DUFKLWHFWXUHLQ²DUWDQGFXOWXUH LQ²$XVWULDQFRQWURORI² EDQNLQJLQDVFLW\RI3DUWKHQRSH DVFRVPRSROLWDQFLW\FRXUW H[FHVVHVLQ²HFFOHVLDVWLFDO EXLOGLQJVLQHGXFDWLRQLQ² HYDFXDWLRQSODQVIRUH[SDQVLRQRI ²*UHHNJDPHVLQDQG+RO\ 5RPDQ(PSLUH²DVLQGHSHQGHQW GXFK\²NQRZQDV.LQJGRPRI 1DSOHVODZLQ²OLWHUDWXUH DQGSRHWU\LQ²ORFDWLRQ² PHGLHYDO²PRQDVWLFRUGHUV LQQHLJKERXUKRRGVSROLWLFDO LQVWDELOLW\LQ²UR\DOWRPEVLQ VHHDOVR$UDJRQHVH1DSOHV%RXUERQ

1DSOHV%\]DQWLQH1DSOHV*UHHN 1HDSROLV,WDOLDQ1DSOHV5RPDQ 1HDSROLV6SDQLVK1DSOHV 1DSROHRQ%RQDSDUWH 1DUVHWHJHQHUDO 1DWDOH0DULD2UVLQL 1DWLRQDO$UFKDHRORJLFDO0XVHXP 1HDSROLWDQVFKRRORIDUW² 1HOVRQ$GPLUDO+RUDWLR²² 1HUR(PSHURU² 1HUXGD3DEOR 1HXH3DYLOORQ 1HXHUEXUJ1RUPDQ 1HZ&DVWOHVHH0DVFKLR$QJLRLQR 1HZ
,1'(;

3DOD]]R)DUQHVH5RPH 3DOD]]R)LORPDULQR 3DOD]]R)LUUDR 3DOD]]R6HUUDGL&DVVDQR 3DOD]]R6HVVD 3DOHSROLV 3DOHUPR 3DOJUDYH6LU)UDQFLV 3DOPD/HRQDUGRGL 3DQWDOHPRQH6DLQW 3DROD)UDQFHVFRGD 3DRODSODFH 3DSDUR$XUHOLR 3DUPD 3DUWHQRSHILOPV 3DUWKHQRSHSODFH 3DUWKHQRSHVLUHQ ² 3DWULFLD6DLQW² 3DXOWKH'HDFRQ 3DXO,3RSH 3HSH*HQHUDO*LXJOLHOPR 3HS\V6DPXHO 3HUJDPXP 3HUJROHVL*LRYDQQL%DWWLVWD 3HUVHSKRQH² 3HVFDUD 3HWHURI$UDJRQ 3HWHU6DLQW² 3HWLWRIDPLO\ 3HWUDUFK)UDQFLV² 3KLOLSRI%RXUERQ 3KLOLS9.LQJRI6SDLQ 3KLORGHPXVRI*DGDUD² 3KOHJUHDQ)LHOGV 3LFFRORPLQL$QWRQLR'XNHRI$PDOIL² 3LHGLJURWWD 3LHGLJURWWD)HVWLYDO 3LHWUDVDQWDEHOOWRZHU 3LOJULP·V+RVSLWDO 3LPHQWHO(OHRQRUD)RQVHFD² 3LR0RQWHGHOOD0LVHULFRUGLD

3LVD 3LWORR$QWRRQ6PLQFN 3LXV,;3RSH 3L]]RIDOFRQH 3ODWHQ$XJXVWYRQ 3ODXWXV 3OLQ\WKH(OGHU 3OLQ\WKH

,17+(6+$'2:2)9(689,86

5DYHQQD 5HD'RPHQLFR 5HGHPSWRULVWV 5HQpRI$QMRX 5HQL*XLGR 5HVWLWXWD6DLQW 5H\QROGV6LU-RVKXD 5LEHUR-XVHSH,RVSDJQROHWWR ² 5LSD0DWWHR² 5LVRUJLPHQWR² 5LYLHUDGL&KLDLD 5REHUW.LQJRI1DSOHV5REHUWWKH:LVH ² 5REHUWRI0LOHWR)DWKHU 5RJHU,,GH+DXWHYLOOH.LQJ² 5RJHURI/DXULD² 5RPDQ1HDSROLVDQQH[DWLRQRI² DUFKLWHFWXUHLQ²DQG$XJXVWDQ LGHRORJ\²&KULVWLDQVLQ² FRPPHUFHLQ²GHFOLQHRI ²*UHHNJDPHVLQ*UHHN LGHQWLW\RI²DVUHVRUWWRZQ ²VODYHVLQWKHDWUHLQ² WKHDWUHVLQ² 5RPROXV$XJXVWXV 5RRPHU*DVSDU 5RVD6DOYDWRUH² 5RVHEHU\/RUG 5RVL)UDQFHVFR 5RVVHOOLQR$QWRQLR 5RVVL/XLJL 5RVVLQL*LRDFKLQR² 5RWKVFKLOG&DUO 5RWKVFKLOG6RORPRQYRQ 5RXVVHDX-HDQ-DFTXHV 5R\DO0LOLWDU\$FDGHP\1XQ]LDWHOOD 5R\DO3DODFHRI&DVHUWD² 5R\DO6RFLHW\ 5XEHQV3HWHU3DXO 5XIIR&DUGLQDO

5XPHL*LXOHR 5XVNLQ-RKQ 5XVVR&DUGLQDO 5XVVR)HUGLQDQGR 6DELQD3RSSDHD 6DFFR5DIDHOH 6DFUR0RQWHGL3LHWj 6DGHPDUTXLVGH 6DLQW$QQDGHL/RPEDUGL&KXUFKRI² 6DLQW&ODUH&KXUFKRI 6DLQW&ODUH&KXUFKRI 6DLQW&RQVWDQFH&KXUFKRI&DSUL ² 6DLQW(OPR&DVWOH 6DLQW-RDQ&DUERQDUD&KXUFKRI 6W-RKQ$PEXODQFH 6DLQW-RKQRI-HUXVDOHPRUGHURI 6DLQW0DU\&KXUFKRI-HUXVDOHP 6DLQW3HWHUDQG6DLQW3DXOPRQDVWHU\ &DQWHUEXU\ 6DOHUQR1LFROD² 6DOHUQRSODFH 6DORQH0DUJKHULWD 6DPQLWHV 6DQ&DUOLQRWKHDWUH 6DQ&DUOR2SHUD+RXVH 6DQ'LHJRDOO·2VSHGDOHWWR&KXUFKRI 6DQ'RPHQLFR0DJJLRUH 6DQ)HUGLQDQGRRSHUDKRXVH 6DQ)UDQFHVFRGL3DROD&KXUFK 6DQ/HXFLR 6DQ/RUHQ]R&KXUFKRI² 6DQ0DUWLQR 6DQ0LQLDWR&KXUFKRI)ORUHQFH 6DQ3LHWURDG$UDPFKXUFKRI 6DQ3LHWURD0DMHOOD&RQVHUYDWRU\ 6DQ6HYHUR&KDSHO 6DQFLD4XHHQ 6DQIHOLFH)HUGLQDQGR 6DQIHOLFH/XLVD²

,1'(;

6DQJUR5DLPRQGRGL² 6DQQD]DUR-DFRSR² 6DQWD0DULDGHO3DUWR0HUJHOOLQD 6DQWD0DULD'RQQD5HJLQDFKXUFKRI 6DQWDQ&DUORV 6DUDFHQV 6DUGLQLD 6DUHGR*LXVHSSH 6DUQHOOL3RPSHR 6DUUR'RPHQLFR 6FDUIRJOLR(GRDUGR 6FDUODWWL$OHVVDQGUR 6FDUODWWL'RPHQLFR 6FDUSHWWD](GRDUGR 6FKLQNHO.DUO)ULHGULFK 6FKQHHU-RVHSK 6FKRODVWLFLVP 6FKROO&RORQHO 6FKRRORI0HGLFLQH6DOHUQR ² 6FKRRORI3RVLOOLSR² 6FKUDGHU/RUHQ] 6HFRQG9DWLFDQ&RXQFLO 6HFRQG:RUOG:DU² 6HOH5LYHU 6HQHFD 6HUDR0DWLOGH 6HUJLXV9,,'XNH 6HUUD$QWRQLR² 6HUUD*LRYDQQL'XNHRI&DVVDQR 6HWWHPEULQL/XLJL 6IRU]D)UDQFHVFR 6KDNHU&OXE 6KHOOH\0DU\ 6KHOOH\3HUF\%\VVKH² 6LFLOLDQ9HVSHUV 6LFLO\ 6LQDWUD)UDQN 6LULJQDQR)HGHULFR² 6ROLPHQD)UDQFHVFR$EDWH&LFFLR ²

6RUUHQWR 6SDJQROHWWR 6SDQLVK1DSOHV²DFDGHPLFWUDGLWLRQ LQ²DUFKLWFWXUHLQ² DUWDQGFXOWXUHLQ²EDQNLQJ LQFDPRUUDLQ²HFRQRPLF GHFOLQH²ILQDQFHDQGFRPPHUFH OD]]DURQL ²IRRGSURYVLRQLQ² RIDVPRGHUQFHQWUDOLVHG VWDWH²PXVLFLQ² QDWXUDOGLVDVWHUVLQ²QRELOLW\ RI²SLHW\LQ²SODJXHLQ SURVWLWXWLRQLQVWDELOLW\LQ WD[DWLRQLQDVWRXULVWDWWUDFWLRQ ² 6WDsO0GPHGH 6WDQ]LRQH0DVVLPR² 6WDWLXV3XEOLXV3DSLQXV 6WHIDQR 6WHQGKDO+HQUL 6WHSKHQ,,'XNHRI1DSOHV² 6WHSKHQ9.LQJ 6WUDER 6WUDGLYDUL$QWRQLR 6WUDXVV5LFKDUG 6WUDYLQVN\,JRU 6WURPEROL 6XPPD0W ·6XRU2UVROR%HQLQFDVD·8QLYHUVLW\ ,QVWLWXWH 6\UDFXVH 7DFLWXV 7DJOLDEXH&DUOR 7DJOLDFR]]R 7DQXFFL%HUQDUGR 7HDQR'XNHRI 7HLD.LQJ 7HOHVLR%HUQDUGLQR 7HUHQFH3XEOLXV7HUHQWLXV$IHU 7HVWD$QWRQHOOD 7KHDWLQHVRUGHU

,17+(6+$'2:2)9(689,86

7KLUW\\HDUV:DU 7KRPDV:LOOLDP 7LEHULXV(PSHURU 7ROGHR&DWKHGUDO² 7ROHGR'RQ3LHWURGL² 7ROHGRSODFH 7ROHQWLQR 7RUUH$QQXQ]LDWD 7RVWL)UDQFHVFR3DROR 7RWLODNLQJ 7UHDW\RI&DVDODQ]D 7URLVL0DVVLPR 7XUFR*LXVHSSH 7XULQ 7XUQHU-0: 7XVFDQ\ 7ZDLQ0DUN 7ZHOOV-RKQ6 7\UUKHQLDQ6HD

HPEOHPRI1DSOHVHUXSWLRQV RI²²²² P\WKRIFUHDWLRQDQGZDUQLQJRI HUXSWLRQV 9LFR*LDPEDWWLVWD² 9LFWRU(PPDQXHO.LQJRI6DYR\ ² 9LJQH$QGUpGHOD 9LOOD&KDWDPRQH 9LOOD&ODXGLR 9LOOD)ORULGLDQD 9LOOD-RYLV 9LOODQL*LRYDQQL 9LUJLO²² 9LVFRQWL3KLOLS0DULD'XNHRI0LODQ 9LWDOLDQR3RSH 9RPHUR² 9XOOLDP\(G

:DJQHU5LFKDUG :DOSROH+RUDFH :DOWRQ:LOOLDP :DUG0DU\ :DUKRO$QG\ :DUQHIULG3DXOVHH3DXOWKH'HDFRQ :DUUHQ-DFN :HGJZRRG-RVLDK :HUWPXOOHU/LQD :HVW0RUULV 9DFFDUR$QGUHD :HVWHUQ(PSLUH 9DOHQFLD :KLWH-HVVLH0DULR 9DOHQWLQLDQ,,, :LOGH2VFDU 9DQ'\FN$QWKRQ\ :LOKHOP,,.DLVHU 9DQYLWHOOL/XLJL² :LOOLDPWKH%DG 9DVDUL*LRUJLR :LOOLDPWKH*RRG 9DWLFDQ/LEUDU\ :LQNHOPDQQ-RKDQQ-RDFKLP 9D]RZ,YDQ :UHIRUG+HQU\ 9HQLFH 9HVXYLXV²² :ULJKW(GZDUG² $'HUXSWLRQ²² =HXV DQGFXOWRI6DLQW*HQQDUR²DV 8O\VVHV² 8PEHUWR,.LQJRI,WDO\ 8QLYHUVLW\RI%RORJQD 8QLYHUVLW\RI1DSOHV 8QLYHUVLW\RI3DGXD 8UEDQ9,3RSH 8WUHFKW7UHDW\RI