Download as pdf or txt
Download as pdf or txt
You are on page 1of 355

Downloaded from orbit.dtu.

dk on: Jan 17, 2022

Management of Reinforcement Corrosion


A Thermodynamic Approach

Küter, Andre

Publication date:
2009

Document Version
Publisher's PDF, also known as Version of record

Link back to DTU Orbit

Citation (APA):
Küter, A. (2009). Management of Reinforcement Corrosion: A Thermodynamic Approach. Technical University of
Denmark.

General rights
Copyright and moral rights for the publications made accessible in the public portal are retained by the authors and/or other copyright
owners and it is a condition of accessing publications that users recognise and abide by the legal requirements associated with these rights.

 Users may download and print one copy of any publication from the public portal for the purpose of private study or research.
 You may not further distribute the material or use it for any profit-making activity or commercial gain
 You may freely distribute the URL identifying the publication in the public portal

If you believe that this document breaches copyright please contact us providing details, and we will remove access to the work immediately
and investigate your claim.
André Küter
In this thesis a consistent thermodynamic basis is established for the description of cor-
rosion processes as well as for the evaluation of existing and the development of new
corrosion countermeasures.

The work covers: a) the adaptation of available thermodynamic principles to the area of
reinforcement corrosion, b) thermodynamically consistent descriptions for the diverse
corrosion states of steel in concrete, c) a review and evaluation of available measures
for corrosion protection, and d) the development of theoretical concepts for new cost-
efficient countermeasures.

In addition to the theoretical considerations, two implementation principles of the de-


veloped concepts are proposed and one of these tested by means of custom-designed
setups and measurement methods.
Management of Reinforcement Corrosion
A Thermodynamic Approach

Management of Reinforcement Corrosion - A Thermodynamic Approach


André Küter

PhD Thesis

Department of Civil Engineering


2009

DTU Civil Engineering Report R-228 (UK)


April 2009

DTU Civil Engineering


Department of Civil Engineering
Technical University of Denmark

Brovej, Building 118


2800 Kgs. Lyngby
Report R-228 2009

Telephone 45 25 17 00

www.byg.dtu.dk

ISBN: 9788778773074
ISSN: 1601-2917
0DQDJHPHQWRI 0DQDJHPHQWRI
5HLQIRUFHPHQW&RUURVLRQ 5HLQIRUFHPHQW&RUURVLRQ
$7KHUPRG\QDPLF$SSURDFK $7KHUPRG\QDPLF$SSURDFK
 
$QGUp.WHU $QGUp.WHU


3K'7KHVLV


3K'7KHVLV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ 'HSDUWPHQWRI&LYLO(QJLQHHULQJ
7HFKQLFDO8QLYHUVLW\RI'HQPDUN 7HFKQLFDO8QLYHUVLW\RI'HQPDUN
 
 

   
3KRWRVIURQWSDJH 3KRWRVIURQWSDJH
&RQVWUXFWLRQRI+HOJHODQG%ULGJH/HLUIMRUGHQ1RUZD\>&2:,D@ &RQVWUXFWLRQRI+HOJHODQG%ULGJH/HLUIMRUGHQ1RUZD\>&2:,D@
0DUFHO3RXUEDL[5XVVLD%HOJLXP>+8-,@ 0DUFHO3RXUEDL[5XVVLD%HOJLXP>+8-,@

0DQDJHPHQWRI5HLQIRUFHPHQW&RUURVLRQ 0DQDJHPHQWRI5HLQIRUFHPHQW&RUURVLRQ
$7KHUPRG\QDPLF$SSURDFK $7KHUPRG\QDPLF$SSURDFK
&RS\ULJKW‹$QGUp.WHU &RS\ULJKW‹$QGUp.WHU
3ULQWHGE\5RVHQGDKOV6FKXOW]*UDILVN 3ULQWHGE\5RVHQGDKOV6FKXOW]*UDILVN
'HSDUWPHQWRI&LYLO(QJLQHHULQJ 'HSDUWPHQWRI&LYLO(QJLQHHULQJ
7HFKQLFDO8QLYHUVLW\RI'HQPDUN 7HFKQLFDO8QLYHUVLW\RI'HQPDUN
,6%1 ,6%1
,661 ,661
 
 

3UHIDFH 3UHIDFH
7KLVWKHVLVLVVXEPLWWHGDVDSDUWLDOIXOILOPHQWRIWKHUHTXLUHPHQWVRIWKH'DQLVK3K' 7KLVWKHVLVLVVXEPLWWHGDVDSDUWLDOIXOILOPHQWRIWKHUHTXLUHPHQWVRIWKH'DQLVK3K'
GHJUHH7KHWKHVLVLVEDVHGRQWKHWKHRUHWLFDOVWXGLHVDQGH[SHULPHQWDOLQYHVWLJDWLRQV GHJUHH7KHWKHVLVLVEDVHGRQWKHWKHRUHWLFDOVWXGLHVDQGH[SHULPHQWDOLQYHVWLJDWLRQV
FRQGXFWHGGXULQJWKH3K'SURMHFW³0DQDJHPHQWRI5HLQIRUFHPHQW&RUURVLRQ´LQWKH FRQGXFWHGGXULQJWKH3K'SURMHFW³0DQDJHPHQWRI5HLQIRUFHPHQW&RUURVLRQ´LQWKH
SHULRGIURP2FWREHUWKURXJK6HSWHPEHUDWWKH'HSDUWPHQWRI&LYLO(QJL SHULRGIURP2FWREHUWKURXJK6HSWHPEHUDWWKH'HSDUWPHQWRI&LYLO(QJL
QHHULQJ '78 %\J  RI WKH 7HFKQLFDO 8QLYHUVLW\ RI 'HQPDUN '78  .JV /\QJE\ QHHULQJ '78 %\J  RI WKH 7HFKQLFDO 8QLYHUVLW\ RI 'HQPDUN '78  .JV /\QJE\
'HQPDUN7KHSURMHFWSHULRGZDVLQWHUPLWWHGE\DOWRJHWKHURQH\HDURIOHDYHIRUSUR 'HQPDUN7KHSURMHFWSHULRGZDVLQWHUPLWWHGE\DOWRJHWKHURQH\HDURIOHDYHIRUSUR
MHFWVWKDWZHUHQRWUHODWHGWRWKH3K'VWXGLHV MHFWVWKDWZHUHQRWUHODWHGWRWKH3K'VWXGLHV
7KHSULQFLSDOVXSHUYLVRURIWKH3K'SURMHFWZDV$VVRFLDWH3URIHVVRU0HWWH5*HLNHU 7KHSULQFLSDOVXSHUYLVRURIWKH3K'SURMHFWZDV$VVRFLDWH3URIHVVRU0HWWH5*HLNHU
IURP'78%\JDQG3URIHVVRU3HU0¡OOHUIURPWKH'HSDUWPHQWRI0HFKDQLFDO(QJL IURP'78%\JDQG3URIHVVRU3HU0¡OOHUIURPWKH'HSDUWPHQWRI0HFKDQLFDO(QJL
QHHULQJ '780HNDQLN DW'78DFWHGDVFRVXSHUYLVRU7KHH[SHULPHQWDOZRUNZDV QHHULQJ '780HNDQLN DW'78DFWHGDVFRVXSHUYLVRU7KHH[SHULPHQWDOZRUNZDV
FDUULHGRXWDW'78%\JDQGDW'780HNDQLNDVZHOODVGXULQJDQH[WHUQDOUHVHDUFK FDUULHGRXWDW'78%\JDQGDW'780HNDQLNDVZHOODVGXULQJDQH[WHUQDOUHVHDUFK
VWD\DWWKH'HSDUWPHQWRI0DWHULDOV6FLHQFHDQG(QJLQHHULQJDW1RUWKZHVWHUQ8QLYHU VWD\DWWKH'HSDUWPHQWRI0DWHULDOV6FLHQFHDQG(QJLQHHULQJDW1RUWKZHVWHUQ8QLYHU
VLW\(YDQVWRQ,/86$ZKHUHWKHUHVHDUFKZDVVXSHUYLVHGE\3URIHVVRU7KRPDV2 VLW\(YDQVWRQ,/86$ZKHUHWKHUHVHDUFKZDVVXSHUYLVHGE\3URIHVVRU7KRPDV2
0DVRQ 0DVRQ
 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN L 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN L
 

$FNQRZOHGJPHQWV $FNQRZOHGJPHQWV
, RZH WKH RXWFRPH RI WKLV 3K' SURMHFW WR P\ VXSHUYLVRUV 0HWWH 5 *HLNHU DQG 3HU , RZH WKH RXWFRPH RI WKLV 3K' SURMHFW WR P\ VXSHUYLVRUV 0HWWH 5 *HLNHU DQG 3HU
0¡OOHU,UHJDUGWKHODVW\HDUVDVDXQLTXHHGXFDWLRQDOMRXUQH\WKURXJKZKLFK,KDYH 0¡OOHU,UHJDUGWKHODVW\HDUVDVDXQLTXHHGXFDWLRQDOMRXUQH\WKURXJKZKLFK,KDYH
DFTXLUHG YDOXDEOH NQRZOHGJH IURP WKHP DQG ZLWK WKHP 7KH\ ZHUH DOZD\V WKHUH DFTXLUHG YDOXDEOH NQRZOHGJH IURP WKHP DQG ZLWK WKHP 7KH\ ZHUH DOZD\V WKHUH
ZKHQQHHGHGIRUHLWKHULQVSLUDWLRQRUKHOS,ZRXOGOLNHWRWKDQN0HWWHDQG3HUPRVW ZKHQQHHGHGIRUHLWKHULQVSLUDWLRQRUKHOS,ZRXOGOLNHWRWKDQN0HWWHDQG3HUPRVW
VLQFHUHO\IRUWKDW VLQFHUHO\IRUWKDW
$W WKH VDPH WLPH , DOVR ZLVK WR H[SUHVV P\ JUDWLWXGH WR DOO P\ FROOHDJXHV DW '78 $W WKH VDPH WLPH , DOVR ZLVK WR H[SUHVV P\ JUDWLWXGH WR DOO P\ FROOHDJXHV DW '78
%\JDQG'780HNDQLNIRUWKHLUSURIHVVLRQDOZRUNDQGIRUKHOSLQJWRPDNHP\SUR %\JDQG'780HNDQLNIRUWKHLUSURIHVVLRQDOZRUNDQGIRUKHOSLQJWRPDNHP\SUR
MHFWERWKSURGXFWLYHDQGHQMR\DEOH MHFWERWKSURGXFWLYHDQGHQMR\DEOH
,ZRXOGDOVROLNHWRWKDQN3URIHVVRU7KRPDV20DVRQDQGKLVJURXSDW1RUWKZHVWHUQ ,ZRXOGDOVROLNHWRWKDQN3URIHVVRU7KRPDV20DVRQDQGKLVJURXSDW1RUWKZHVWHUQ
8QLYHUVLW\IRUWKHYDOXDEOHLQSXWDJUHDWWLPHDQGIRUOHWWLQJPHXVHWKHIDFLOLWLHVDW 8QLYHUVLW\IRUWKHYDOXDEOHLQSXWDJUHDWWLPHDQGIRUOHWWLQJPHXVHWKHIDFLOLWLHVDW
WKH'HSDUWPHQW WKH'HSDUWPHQW
)XUWKHUPRUH,ZRXOGOLNHWRWKDQN+HOOH)LHGOHUDQG.DUO-RKDQ+DQVHQIURP+HPSHO )XUWKHUPRUH,ZRXOGOLNHWRWKDQN+HOOH)LHGOHUDQG.DUO-RKDQ+DQVHQIURP+HPSHO
$6LQ.JV/\QJE\0DGV&1LHOVHQDQG&KULVWLQD3HGHUVHQIURP/HPYLJK0OOHU $6LQ.JV/\QJE\0DGV&1LHOVHQDQG&KULVWLQD3HGHUVHQIURP/HPYLJK0OOHU
6WnO$6LQ&RSHQKDJHQ /HLI%UXQFNKRUVW IURP &RQGRU .HPL $6 LQ*ORVWUXSDQG 6WnO$6LQ&RSHQKDJHQ /HLI%UXQFNKRUVW IURP &RQGRU .HPL $6 LQ*ORVWUXSDQG
7KRPDV 3HWHUVHQ IURP 0 6HDOV $6 LQ (VSHUJ UGH DOO LQ 'HQPDUN  DQG 5DLQHU 7KRPDV 3HWHUVHQ IURP 0 6HDOV $6 LQ (VSHUJ UGH DOO LQ 'HQPDUN  DQG 5DLQHU
2OVFKRN IURP 'UDKWZHUN (OLVHQWDO LQ 1HXHQUDGH *HUPDQ\ IRU DGYLFH DQG IUHHRI 2OVFKRN IURP 'UDKWZHUN (OLVHQWDO LQ 1HXHQUDGH *HUPDQ\ IRU DGYLFH DQG IUHHRI
FKDUJHSURYLVLRQRIH[SHULPHQWDOHTXLSPHQWDQGPDWHULDOV FKDUJHSURYLVLRQRIH[SHULPHQWDOHTXLSPHQWDQGPDWHULDOV
,DOVRZLVKWRH[SUHVVP\JUDWLWXGHWRWKHVSRQVRUVRIP\H[WHUQDOVWD\DQGRIWZRRI ,DOVRZLVKWRH[SUHVVP\JUDWLWXGHWRWKHVSRQVRUVRIP\H[WHUQDOVWD\DQGRIWZRRI
WKH FRQIHUHQFHV , SDUWLFLSDWHG LQ 0\ H[WHUQDO VWD\ DW 1RUWKZHVWHUQ 8QLYHUVLW\ ZDV WKH FRQIHUHQFHV , SDUWLFLSDWHG LQ 0\ H[WHUQDO VWD\ DW 1RUWKZHVWHUQ 8QLYHUVLW\ ZDV
IXQGHGE\WKH.QXG+¡MJDDUG)RXQGDWLRQ.JV /\QJE\'HQPDUNP\SDUWLFLSDWLRQ IXQGHGE\WKH.QXG+¡MJDDUG)RXQGDWLRQ.JV /\QJE\'HQPDUNP\SDUWLFLSDWLRQ
LQ &RQ0DW¶ 9DQFRXYHU %& &DQDGD ZDV ILQDQFHG E\ WKH 2WWR 0¡QVWHGV )RQG LQ &RQ0DW¶ 9DQFRXYHU %& &DQDGD ZDV ILQDQFHG E\ WKH 2WWR 0¡QVWHGV )RQG
+HOOHUXS'HQPDUNDQGE\WKH5HVHDUFKDQG,QQRYDWLRQ&RPPLWWHHRI'78%\JDQG +HOOHUXS'HQPDUNDQGE\WKH5HVHDUFKDQG,QQRYDWLRQ&RPPLWWHHRI'78%\JDQG
WKHDLUIDUHIRUP\SDUWLFLSDWLRQLQ1.05H\NMDYLN,FHODQGZDVVSRQVRUHGE\WKH WKHDLUIDUHIRUP\SDUWLFLSDWLRQLQ1.05H\NMDYLN,FHODQGZDVVSRQVRUHGE\WKH
8QLYHUVLW\RI,FHODQG5H\NMDYLN 8QLYHUVLW\RI,FHODQG5H\NMDYLN
0RUHRYHU,ZRXOGOLNHWRJUDWHIXOO\DFNQRZOHGJHWKHILQDQFLDOVXSSRUWRI&2:,IRQ 0RUHRYHU,ZRXOGOLNHWRJUDWHIXOO\DFNQRZOHGJHWKHILQDQFLDOVXSSRUWRI&2:,IRQ
GHQ .JV /\QJE\ 'HQPDUN IRU WKH HVWDEOLVKPHQW RI D KLJKFDSDFLW\ H[SRVXUH DQG GHQ .JV /\QJE\ 'HQPDUN IRU WKH HVWDEOLVKPHQW RI D KLJKFDSDFLW\ H[SRVXUH DQG
PRQLWRULQJV\VWHPIRUWHVWLQJRIUHLQIRUFHPHQWFRUURVLRQ PRQLWRULQJV\VWHPIRUWHVWLQJRIUHLQIRUFHPHQWFRUURVLRQ
)LQDOO\ , ZRXOG OLNH WR WKDQN P\SDUHQWV 8WH DQG :ROIJDQJ DQGP\ ZLIH0DUHLNH )LQDOO\ , ZRXOG OLNH WR WKDQN P\SDUHQWV 8WH DQG :ROIJDQJ DQG P\ ZLIH 0DUHLNH
IRUWKHLUFRQVWDQWHQFRXUDJHPHQWDQGFDUH IRUWKHLUFRQVWDQWHQFRXUDJHPHQWDQGFDUH
 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN LLL 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN LLL


 

$EVWUDFW $EVWUDFW
6HYHUDO PHDVXUHV WR FRPEDW UHLQIRUFHPHQWFRUURVLRQKDYHEHHQSURSRVHGGXULQJWKH 6HYHUDO PHDVXUHV WR FRPEDW UHLQIRUFHPHQW FRUURVLRQ KDYHEHHQSURSRVHGGXULQJWKH
SDVWGHFDGHVWKHVHFRPSULVHERWKSUHYHQWLYHDQGUHKDELOLWDWLRQPHDVXUHV$URXQG SDVWGHFDGHVWKHVHFRPSULVHERWKSUHYHQWLYHDQGUHKDELOLWDWLRQPHDVXUHV$URXQG
SDWHQWV SHUWDLQLQJ WR OLPLWLQJ FRUURVLRQ RI VWHHO LQ FRQFUHWH KDYH EHHQ VXEPLWWHG LQ SDWHQWV SHUWDLQLQJ WR OLPLWLQJ FRUURVLRQ RI VWHHO LQ FRQFUHWH KDYH EHHQ VXEPLWWHG LQ
DORQH6RPHRIWKHVHSDWHQWVUHODWHWRFRUURVLRQLQKLELWRUVRWKHUVWDNHDFFRXQWRI DORQH6RPHRIWKHVHSDWHQWVUHODWHWRFRUURVLRQLQKLELWRUVRWKHUVWDNHDFFRXQWRI
VXUIDFH PRGLILFDWLRQV FDWKRGLF SURWHFWLRQ RU UHSODFHPHQW RI FDUERQ VWHHO UHLQIRUFH VXUIDFH PRGLILFDWLRQV FDWKRGLF SURWHFWLRQ RU UHSODFHPHQW RI FDUERQ VWHHO UHLQIRUFH
PHQWZLWKDOWHUQDWLYHPDWHULDOV2IWHQLWLVGLIILFXOWWRHYDOXDWHWKHYDOXHRIVXFKSUR PHQWZLWKDOWHUQDWLYHPDWHULDOV2IWHQLWLVGLIILFXOWWRHYDOXDWHWKHYDOXHRIVXFKSUR
SRVDOV VLQFH WKHLU HIIHFWLYHQHVV LV ODUJHO\ JRYHUQHG E\ WKH JLYHQ FRQGLWLRQV LH WKH SRVDOV VLQFH WKHLU HIIHFWLYHQHVV LV ODUJHO\ JRYHUQHG E\ WKH JLYHQ FRQGLWLRQV LH WKH
PLFURVWUXFWXUHRIWKHFRQFUHWHWKHFRQFUHWHVWHHOLQWHUIDFHDQGQRWOHDVWWKHVXUURXQG PLFURVWUXFWXUHRIWKHFRQFUHWHWKHFRQFUHWHVWHHOLQWHUIDFHDQGQRWOHDVWWKHVXUURXQG
LQJHQYLURQPHQW LQJHQYLURQPHQW
2QO\DIHZPHWKRGVDVWKHXVHRIVWDLQOHVVVWHHOVDQGFDWKRGLFSURWHFWLRQDUHFRQVLG 2QO\DIHZPHWKRGVDVWKHXVHRIVWDLQOHVVVWHHOVDQGFDWKRGLFSURWHFWLRQDUHFRQVLG
HUHG WREH HIIHFWLYH FRUURVLRQ FRXQWHUPHDVXUHV EXWWKHVHPHWKRGV FDQQRW DOZD\VEH HUHG WREH HIIHFWLYH FRUURVLRQ FRXQWHUPHDVXUHV EXWWKHVHPHWKRGV FDQQRW DOZD\VEH
MXVWLILHG IRU HFRQRPLFDO RU WHFKQLFDO UHDVRQV 7KXV WKHUH LV ± HYHQ DIWHU GHFDGHV RI MXVWLILHG IRU HFRQRPLFDO RU WHFKQLFDO UHDVRQV 7KXV WKHUH LV ± HYHQ DIWHU GHFDGHV RI
UHVHDUFKDQGGHYHORSPHQWLQWKHDUHDRIFRUURVLRQSURWHFWLRQ±VWLOOGHPDQGIRUERWK UHVHDUFKDQGGHYHORSPHQWLQWKHDUHDRIFRUURVLRQSURWHFWLRQ±VWLOOGHPDQGIRUERWK
SUHYHQWLYH DQG UHKDELOLWDWLRQ PHDVXUHV ZKLFK DUH HIIHFWLYH DQG LQ SDUWLFXODU FRVW SUHYHQWLYH DQG UHKDELOLWDWLRQ PHDVXUHV ZKLFK DUH HIIHFWLYH DQG LQ SDUWLFXODU FRVW
HIILFLHQW HIILFLHQW
7KH ODFN RI SHUIRUPDQFH RI VRPH FRXQWHUPHDVXUHV FDQ EH H[SODLQHG E\ FRQFHSWXDO 7KH ODFN RI SHUIRUPDQFH RI VRPH FRXQWHUPHDVXUHV FDQ EH H[SODLQHG E\ FRQFHSWXDO
ZHDNQHVVHVIURPDWKHUPRG\QDPLFSHUVSHFWLYHDVWKHGHVFULSWLRQVRIWKHPHFKDQLVPV ZHDNQHVVHVIURPDWKHUPRG\QDPLFSHUVSHFWLYHDVWKHGHVFULSWLRQVRIWKHPHFKDQLVPV
DUHLQFRQVLVWHQWRULQFRPSOHWH7KDWKROGVSDUWLFXODUO\IRUIRUPDWLRQRIPDFURFHOOVDQG DUHLQFRQVLVWHQWRULQFRPSOHWH7KDWKROGVSDUWLFXODUO\IRUIRUPDWLRQRIPDFURFHOOVDQG
WKXV FRQFHQWUDWLRQ FHOOV ZKHUH WKH FRUURVLRQ PHFKDQLVPV LQ FRPELQDWLRQ ZLWK WKH WKXV FRQFHQWUDWLRQ FHOOV ZKHUH WKH FRUURVLRQ PHFKDQLVPV LQ FRPELQDWLRQ ZLWK WKH
FHPHQWFKHPLVWU\FDQHDVLO\EHTXLWHFRPSOH[HJWKHPHFKDQLVPVIRUWKHIRUPDWLRQ FHPHQWFKHPLVWU\FDQHDVLO\EHTXLWHFRPSOH[HJWKHPHFKDQLVPVIRUWKHIRUPDWLRQ
RIJUHHQUXVW RIJUHHQUXVW
:LWK WKH DERYH DV SRLQW RI RULJLQ LQ WKH SUHVHQW WKHVLV D FRQVLVWHQW WKHUPRG\QDPLF :LWK WKH DERYH DV SRLQW RI RULJLQ LQ WKH SUHVHQW WKHVLV D FRQVLVWHQW WKHUPRG\QDPLF
EDVLVLVHVWDEOLVKHGIRUWKHGHVFULSWLRQRIFRUURVLRQSURFHVVHVDVZHOODVIRUWKHHYDOXD EDVLVLVHVWDEOLVKHGIRUWKHGHVFULSWLRQRIFRUURVLRQSURFHVVHVDVZHOODVIRUWKHHYDOXD
WLRQ RI H[LVWLQJ DQG WKH GHYHORSPHQW RI QHZ FRUURVLRQ FRXQWHUPHDVXUHV 7KH ZRUN WLRQ RI H[LVWLQJ DQG WKH GHYHORSPHQW RI QHZ FRUURVLRQ FRXQWHUPHDVXUHV 7KH ZRUN
FRYHUV D  WKH DGDSWDWLRQ RI DYDLODEOH WKHUPRG\QDPLF SULQFLSOHV WR WKH DUHD RI UHLQ FRYHUV D  WKH DGDSWDWLRQ RI DYDLODEOH WKHUPRG\QDPLF SULQFLSOHV WR WKH DUHD RI UHLQ
IRUFHPHQWFRUURVLRQE WKHUPRG\QDPLFDOO\FRQVLVWHQWGHVFULSWLRQVRIWKHGLYHUVHFRU IRUFHPHQWFRUURVLRQE WKHUPRG\QDPLFDOO\FRQVLVWHQWGHVFULSWLRQVRIWKHGLYHUVHFRU
URVLRQVWDWHVRIVWHHOLQFRQFUHWHF DUHYLHZDQGHYDOXDWLRQRIDYDLODEOHPHDVXUHVIRU URVLRQVWDWHVRIVWHHOLQFRQFUHWHF DUHYLHZDQGHYDOXDWLRQRIDYDLODEOHPHDVXUHVIRU
FRUURVLRQ SURWHFWLRQ DQG G  WKH GHYHORSPHQW RI WKHRUHWLFDO FRQFHSWV IRU QHZ FRVW FRUURVLRQ SURWHFWLRQ DQG G  WKH GHYHORSPHQW RI WKHRUHWLFDO FRQFHSWV IRU QHZ FRVW
HIILFLHQW FRXQWHUPHDVXUHV ,Q DGGLWLRQ WR WKH WKHRUHWLFDO FRQVLGHUDWLRQV WZR LPSOH HIILFLHQW FRXQWHUPHDVXUHV ,Q DGGLWLRQ WR WKH WKHRUHWLFDO FRQVLGHUDWLRQV WZR LPSOH
PHQWDWLRQSULQFLSOHVRIWKHGHYHORSHGFRQFHSWVDUHSURSRVHGDQGRQHRIWKHVHWHVWHG PHQWDWLRQSULQFLSOHVRIWKHGHYHORSHGFRQFHSWVDUHSURSRVHGDQGRQHRIWKHVHWHVWHG
E\PHDQVRIFXVWRPGHVLJQHGVHWXSVDQGPHDVXUHPHQWPHWKRGV E\PHDQVRIFXVWRPGHVLJQHGVHWXSVDQGPHDVXUHPHQWPHWKRGV
7KHWZRSURSRVHGSULQFLSOHVUHODWHWRWKHXVHRIRUGLQDU\FDUERQVWHHOUHLQIRUFHPHQW 7KHWZRSURSRVHGSULQFLSOHVUHODWHWRWKHXVHRIRUGLQDU\FDUERQVWHHOUHLQIRUFHPHQW
DQGFDQEHDSSOLHGIRUERWKQHZDQGH[LVWLQJVWUXFWXUHV7KHILUVWSULQFLSOHLVEDVHGRQ DQGFDQEHDSSOLHGIRUERWKQHZDQGH[LVWLQJVWUXFWXUHV7KHILUVWSULQFLSOHLVEDVHGRQ
D VXUIDFH PRGLILFDWLRQ RI FDUERQ VWHHO UHLQIRUFHPHQW ZKHUHDV WKH VHFRQG SULQFLSOH D VXUIDFH PRGLILFDWLRQ RI FDUERQ VWHHO UHLQIRUFHPHQW ZKHUHDV WKH VHFRQG SULQFLSOH
HPSOR\VQHZFRQFHSWVIRUVDFULILFLDODQRGHV%RWKSULQFLSOHVDUHH[SHFWHGWRVLJQLIL HPSOR\VQHZFRQFHSWVIRUVDFULILFLDODQRGHV%RWKSULQFLSOHVDUHH[SHFWHGWRVLJQLIL
FDQWO\LPSURYHWKHFRUURVLRQSURWHFWLRQRIFDUERQVWHHOUHLQIRUFHPHQWLQFDUERQDWHGRU FDQWO\LPSURYHWKHFRUURVLRQSURWHFWLRQRIFDUERQVWHHOUHLQIRUFHPHQWLQFDUERQDWHGRU
FKORULGHFRQWDPLQDWHGFRQFUHWH FKORULGHFRQWDPLQDWHGFRQFUHWH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN Y 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN Y
$EVWUDFW $EVWUDFW

%RWKSULQFLSOHVRILPSOHPHQWDWLRQDLPDWREWDLQLQJWDUJHWHGORZFRUURVLRQSRWHQWLDOV %RWKSULQFLSOHVRILPSOHPHQWDWLRQDLPDWREWDLQLQJWDUJHWHGORZFRUURVLRQSRWHQWLDOV
7KHPDWHULDOVFRQFHSWVDUHEDVHGRQSURFHVVHVWKDWLQWURGXFHPDJQHVLXPDQG]LQFLQ 7KHPDWHULDOVFRQFHSWVDUHEDVHGRQSURFHVVHVWKDWLQWURGXFHPDJQHVLXPDQG]LQFLQ
FRPELQDWLRQZLWKVXSSOHPHQWDU\HOHFWURFKHPLFDOO\DFWLYHFRPSRXQGVWRWKHFRQFUHWH FRPELQDWLRQZLWKVXSSOHPHQWDU\HOHFWURFKHPLFDOO\DFWLYHFRPSRXQGVWRWKHFRQFUHWH
VWHHOV\VWHP,QDGGLWLRQWRWKHSURYLVLRQRIORZFRUURVLRQSRWHQWLDOVWKHILUVWSULQFLSOH VWHHOV\VWHP,QDGGLWLRQWRWKHSURYLVLRQRIORZFRUURVLRQSRWHQWLDOVWKHILUVWSULQFLSOH
DOVRHQDEOHVDQLPSURYHPHQWRIWKHFRQFUHWHVWHHOLQWHUIDFH DOVRHQDEOHVDQLPSURYHPHQWRIWKHFRQFUHWHVWHHOLQWHUIDFH
$Q H[SHULPHQWDO VHWXS ZDV HVWDEOLVKHG IRU LQYHVWLJDWLQJ WKH ILUVW SULQFLSOH RI LPSOH $Q H[SHULPHQWDO VHWXS ZDV HVWDEOLVKHG IRU LQYHVWLJDWLQJ WKH ILUVW SULQFLSOH RI LPSOH
PHQWDWLRQ 7KH H[SHULPHQWV ZHUH SHUIRUPHG RQ UHLQIRUFLQJ EDUV HPEHGGHG LQ HLWKHU PHQWDWLRQ 7KH H[SHULPHQWV ZHUH SHUIRUPHG RQ UHLQIRUFLQJ EDUV HPEHGGHG LQ HLWKHU
PRUWDU RU FHPHQW SDVWH 0RUWDU VSHFLPHQV ZLWK FDVWLQ HOHFWURGHV ZHUH DSSOLHG IRU PRUWDU RU FHPHQW SDVWH 0RUWDU VSHFLPHQV ZLWK FDVWLQ HOHFWURGHV ZHUH DSSOLHG IRU
REWDLQLQJ FRPSUHKHQVLYH HOHFWURFKHPLFDO GDWD IRU WKH UHLQIRUFHPHQW DQG WKH PRUWDU REWDLQLQJ FRPSUHKHQVLYH HOHFWURFKHPLFDO GDWD IRU WKH UHLQIRUFHPHQW DQG WKH PRUWDU
PDWUL[ $Q DXWRPDWHG V\VWHP EDVHG RQ FOXVWHU PHDVXUHPHQWV DOORZHG IRU GHWDLOHG PDWUL[ $Q DXWRPDWHG V\VWHP EDVHG RQ FOXVWHU PHDVXUHPHQWV DOORZHG IRU GHWDLOHG
PRQLWRULQJ RI PXOWLSOH VSHFLPHQV 0RQLWRULQJ RI WKH FRUURVLRQSRWHQWLDODQG PDFUR PRQLWRULQJ RI PXOWLSOH VSHFLPHQV 0RQLWRULQJ RI WKH FRUURVLRQSRWHQWLDODQG PDFUR
FHOO FXUUHQW ZDV SHUIRUPHG FRQWLQXRXVO\ DQG IUHTXHQWO\ VXSSOHPHQWHG E\ HOHFWUR FHOO FXUUHQW ZDV SHUIRUPHG FRQWLQXRXVO\ DQG IUHTXHQWO\ VXSSOHPHQWHG E\ HOHFWUR
FKHPLFDOLPSHGDQFHVSHFWURVFRS\7KHFHPHQWSDVWHVSHFLPHQVZKLFKFRXOGEHSUR FKHPLFDOLPSHGDQFHVSHFWURVFRS\7KHFHPHQWSDVWHVSHFLPHQVZKLFKFRXOGEHSUR
GXFHGLQODUJHDPRXQWZHUHXVHGIRULQLWLDODVZHOODVGHVWUXFWLYHPHDVXUHPHQWVHJ GXFHGLQODUJHDPRXQWZHUHXVHGIRULQLWLDODVZHOODVGHVWUXFWLYHPHDVXUHPHQWVHJ
DQRGLF SRODULVDWLRQ FXUYHV ,Q DGGLWLRQ WR WKH HOHFWURFKHPLFDO WHFKQLTXHV FKHPLFDO DQRGLF SRODULVDWLRQ FXUYHV ,Q DGGLWLRQ WR WKH HOHFWURFKHPLFDO WHFKQLTXHV FKHPLFDO
DQDO\VHVZHUHDSSOLHGIRUHJWKHGHWHUPLQDWLRQRIFKORULGHFRQWHQWVRUS+DOWHUDWLRQV DQDO\VHVZHUHDSSOLHGIRUHJWKHGHWHUPLQDWLRQRIFKORULGHFRQWHQWVRUS+DOWHUDWLRQV
0LFURVFRS\DQGHQHUJ\GLVSHUVLYH;UD\VSHFWURVFRS\ZHUHXVHGWRREWDLQH[WHQVLYH 0LFURVFRS\DQGHQHUJ\GLVSHUVLYH;UD\VSHFWURVFRS\ZHUHXVHGWRREWDLQH[WHQVLYH
GDWDIRUDFRPSUHKHQVLYHWKHUPRG\QDPLFSHUIRUPDQFHHYDOXDWLRQ GDWDIRUDFRPSUHKHQVLYHWKHUPRG\QDPLFSHUIRUPDQFHHYDOXDWLRQ
6HOHFWHGH[SHULPHQWDOUHVXOWVDUHXVHGLQWKLVWKHVLVDVLOOXVWUDWLRQDQGGRFXPHQWDWLRQ 6HOHFWHGH[SHULPHQWDOUHVXOWVDUHXVHGLQWKLVWKHVLVDVLOOXVWUDWLRQDQGGRFXPHQWDWLRQ
RIWKHSURSRVHGPHFKDQLVPVDQGFRQFHSWV:LWKUHJDUGWRH[SHFWHGSDWHQWSRVVLELOL RIWKHSURSRVHGPHFKDQLVPVDQGFRQFHSWV:LWKUHJDUGWRH[SHFWHGSDWHQWSRVVLELOL
WLHVFHUWDLQFHQWUDOFRQFHSWVDQGUHVXOWVIURPWKHH[SHULPHQWDOLQYHVWLJDWLRQVFRQFHUQ WLHVFHUWDLQFHQWUDOFRQFHSWVDQGUHVXOWVIURPWKHH[SHULPHQWDOLQYHVWLJDWLRQVFRQFHUQ
LQJWKHLPSOHPHQWDWLRQRIQHZFRXQWHUPHDVXUHVDUHQRWLQFOXGHGLQWKHSUHVHQWWKHVLV LQJWKHLPSOHPHQWDWLRQRIQHZFRXQWHUPHDVXUHVDUHQRWLQFOXGHGLQWKHSUHVHQWWKHVLV
WKH\ZLOOEHGHDOWZLWKLQIXWXUHSXEOLFDWLRQV WKH\ZLOOEHGHDOWZLWKLQIXWXUHSXEOLFDWLRQV
 

YL 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN YL 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 

5HVXPp LQ'DQLVK  5HVXPp LQ'DQLVK 


$GVNLOOHOLJH PHWRGHU WLO EHJU QVQLQJ DI DUPHULQJVNRUURVLRQ HU EOHYHW IRUHVOnHW JHQ $GVNLOOHOLJH PHWRGHU WLO EHJU QVQLQJ DI DUPHULQJVNRUURVLRQ HU EOHYHW IRUHVOnHW JHQ
QHPGHVHQHVWHnUWLHUGLVVHRPIDWWHUEnGHIRUHE\JJHQGHRJXGEHGUHQGHIRUDQVWDOWQLQ QHPGHVHQHVWHnUWLHUGLVVHRPIDWWHUEnGHIRUHE\JJHQGHRJXGEHGUHQGHIRUDQVWDOWQLQ
JHU$OHQHLHUGHULQGJLYHWFDSDWHQWHUPHGUHODWLRQWLOPLQLPHULQJDINRUUR JHU$OHQHLHUGHULQGJLYHWFDSDWHQWHUPHGUHODWLRQWLOPLQLPHULQJDINRUUR
VLRQDIVWnOLEHWRQ1RJOHDIGLVVHSDWHQWHUWDJHUXGJDQJVSXQNWLDQYHQGHOVHDINRUUR VLRQDIVWnOLEHWRQ1RJOHDIGLVVHSDWHQWHUWDJHUXGJDQJVSXQNWLDQYHQGHOVHDINRUUR
VLRQVLQKLELWRUHUDQGUHRPKDQGOHURYHUIODGHPRGLILFHULQJHUNDWRGLVNEHVN\WWHOVHHOOHU VLRQVLQKLELWRUHUDQGUHRPKDQGOHURYHUIODGHPRGLILFHULQJHUNDWRGLVNEHVN\WWHOVHHOOHU
XGVNLIWQLQJDINXOVWRIVWnODUPHULQJPHGDOWHUQDWLYHPDWHULDOHU'HWHURIWHYDQVNHOLJWDW XGVNLIWQLQJDINXOVWRIVWnODUPHULQJPHGDOWHUQDWLYHPDWHULDOHU'HWHURIWHYDQVNHOLJWDW
YXUGHUHY UGLHQDIVnGDQQHWLOWDJGDGHUHVHIIHNWLYLWHWLK¡MJUDGHUVW\UHWDINRQNUHWH YXUGHUHY UGLHQDIVnGDQQHWLOWDJGDGHUHVHIIHNWLYLWHWLK¡MJUDGHUVW\UHWDINRQNUHWH
IRUKROG GYV EHWRQHQV PLNURVWUXNWXU JU QVHIODGHQ PHOOHP EHWRQ RJ VWnO RJ LNNH IRUKROG GYV EHWRQHQV PLNURVWUXNWXU JU QVHIODGHQ PHOOHP EHWRQ RJ VWnO RJ LNNH
PLQGVWGHWRPJLYHQGHPLOM¡ PLQGVWGHWRPJLYHQGHPLOM¡
.XQInPHWRGHUVRPEUXJDIUXVWIULHVWnOW\SHURJNDWRGLVNEHVN\WWHOVHUHJQHVIRUDW .XQInPHWRGHUVRPEUXJDIUXVWIULHVWnOW\SHURJNDWRGLVNEHVN\WWHOVHUHJQHVIRUDW
Y UH HIIHNWLYH IRUDQVWDOWQLQJHU PRG DUPHULQJVNRUURVLRQ PHQ GLVVH PHWRGHU NDQ DI Y UH HIIHNWLYH IRUDQVWDOWQLQJHU PRG DUPHULQJVNRUURVLRQ PHQ GLVVH PHWRGHU NDQ DI
¡NRQRPLVNHHOOHUWHNQLVNHnUVDJHULNNHDOWLGEHUHWWLJHV'HUHUVnOHGHV±VHOYHIWHUnU ¡NRQRPLVNHHOOHUWHNQLVNHnUVDJHULNNHDOWLGEHUHWWLJHV'HUHUVnOHGHV±VHOYHIWHUnU
WLHUVIRUVNQLQJRJXGYLNOLQJDIPHWRGHUWLOLP¡GHJnHOVHDIDUPHULQJVNRUURVLRQ±VWDGLJ WLHUVIRUVNQLQJRJXGYLNOLQJDIPHWRGHUWLOLP¡GHJnHOVHDIDUPHULQJVNRUURVLRQ±VWDGLJ
HIWHUVS¡UJVHO HIWHU EnGH IRUHE\JJHQGH RJ XGEHGUHQGH O¡VQLQJHU VRP HU HIIHNWLYH RJ HIWHUVS¡UJVHO HIWHU EnGH IRUHE\JJHQGH RJ XGEHGUHQGH O¡VQLQJHU VRP HU HIIHNWLYH RJ
LV U¡NRQRPLVNDWWUDNWLYH LV U¡NRQRPLVNDWWUDNWLYH
'HQPDQJOHQGHHIIHNWDIQRJOHIRUDQVWDOWQLQJHUNDQIRUNODUHVYHGDWGHEHVLGGHUNRQ 'HQPDQJOHQGHHIIHNWDIQRJOHIRUDQVWDOWQLQJHUNDQIRUNODUHVYHGDWGHEHVLGGHUNRQ
FHSWXHOOHVYDJKHGHUVHWIUDHWWHUPRG\QDPLVNV\QVSXQNWLGHWEHVNULYHOVHUQHDIPHND FHSWXHOOHVYDJKHGHUVHWIUDHWWHUPRG\QDPLVNV\QVSXQNWLGHWEHVNULYHOVHUQHDIPHND
QLVPHUQHIUHPVWnUWHUPRG\QDPLVNVHWLQNRQVHNYHQWHHOOHUXIXOGVW QGLJH+HUW QNHV QLVPHUQHIUHPVWnUWHUPRG\QDPLVNVHWLQNRQVHNYHQWHHOOHUXIXOGVW QGLJH+HUW QNHV
VSHFLHOW Sn GDQQHOVHQ DI PDNURFHOOHU RJ GHUPHG NRQFHQWUDWLRQVFHOOHU KYRU NRUURVL VSHFLHOW Sn GDQQHOVHQ DI PDNURFHOOHU RJ GHUPHG NRQFHQWUDWLRQVFHOOHU KYRU NRUURVL
RQVPHNDQLVPHUQH L NRPELQDWLRQHQ PHG FHPHQWNHPLHQ OHW EOLYHU PHJHW NRPSOHNVH RQVPHNDQLVPHUQH L NRPELQDWLRQHQ PHG FHPHQWNHPLHQ OHW EOLYHU PHJHW NRPSOHNVH
IHNVPHNDQLVPHUQHIRUGDQQHOVHQDIJU¡QUXVW IHNVPHNDQLVPHUQHIRUGDQQHOVHQDIJU¡QUXVW
0HGXGJDQJVSXQNWLRYHQVWnHQGHHUGHWIRUPnOHWPHGGHQQHDIKDQGOLQJDWHWDEOHUHHQ 0HGXGJDQJVSXQNWLRYHQVWnHQGHHUGHWIRUPnOHWPHGGHQQHDIKDQGOLQJDWHWDEOHUHHQ
VDPPHQK QJHQGH WHUPRG\QDPLVN EDVLV WLO EHVNULYHOVH DI NRUURVLRQVSURFHVVHU VDPW VDPPHQK QJHQGH WHUPRG\QDPLVN EDVLV WLO EHVNULYHOVH DI NRUURVLRQVSURFHVVHU VDPW
YXUGHULQJDIHNVLVWHUHQGHRJXGYLNOLQJDIQ\HIRUDQVWDOWQLQJHUPRGNRUURVLRQ'HUHU YXUGHULQJDIHNVLVWHUHQGHRJXGYLNOLQJDIQ\HIRUDQVWDOWQLQJHUPRGNRUURVLRQ'HUHU
IRUHWDJHWD WLOSDVQLQJDIWLOJ QJHOLJHWHUPRG\QDPLVNHSULQFLSSHUWLORPUnGHWNRUURVL IRUHWDJHWD WLOSDVQLQJDIWLOJ QJHOLJHWHUPRG\QDPLVNHSULQFLSSHUWLORPUnGHWNRUURVL
RQVEHVN\WWHOVHDIVWnOLEHWRQE RSVWLOOLQJDIHQWHUPRG\QDPLVNNRQVLVWHQWEHVNULYHOVH RQVEHVN\WWHOVHDIVWnOLEHWRQE RSVWLOOLQJDIHQWHUPRG\QDPLVNNRQVLVWHQWEHVNULYHOVH
DI GH IRUVNHOOLJH NRUURVLRQVWLOVWDQGH IRU VWnO L EHWRQ F  JUDQVNQLQJ RJ HYDOXHULQJ DI DI GH IRUVNHOOLJH NRUURVLRQVWLOVWDQGH IRU VWnO L EHWRQ F  JUDQVNQLQJ RJ HYDOXHULQJ DI
QXY UHQGH IRUDQVWDOWQLQJHU WLO NRUURVLRQVEHVN\WWHOVH RJ G  XGYLNOLQJHQ DI WHRUHWLVNH QXY UHQGH IRUDQVWDOWQLQJHU WLO NRUURVLRQVEHVN\WWHOVH RJ G  XGYLNOLQJHQ DI WHRUHWLVNH
NRQFHSWHUIRUQ\HRPNRVWQLQJVHIIHNWLYHIRUDQVWDOWQLQJHU6RPVXSSOHPHQWWLOGHWHRUH NRQFHSWHUIRUQ\HRPNRVWQLQJVHIIHNWLYHIRUDQVWDOWQLQJHU6RPVXSSOHPHQWWLOGHWHRUH
WLVNHEHWUDJWQLQJHUHUWRDQYHQGHOVHUDIGHWHRUHWLVNHNRQFHSWHUEOHYHWIRUHVOnHWRJpQ WLVNHEHWUDJWQLQJHUHUWRDQYHQGHOVHUDIGHWHRUHWLVNHNRQFHSWHUEOHYHWIRUHVOnHWRJpQ
DIGLVVHDISU¡YHWYHGKM OSDIVSHFLHOWXGYLNOHGHIRUV¡JVRSVWLOOLQJHURJPnOHPHWRGHU DIGLVVHDISU¡YHWYHGKM OSDIVSHFLHOWXGYLNOHGHIRUV¡JVRSVWLOOLQJHURJPnOHPHWRGHU
'HWRIRUHVOnHGHNRUURVLRQVEHVN\WWHOVHVSULQFLSSHUHUXGYLNOHWWLOEHVN\WWHOVHDIDOPLQ 'HWRIRUHVOnHGHNRUURVLRQVEHVN\WWHOVHVSULQFLSSHUHUXGYLNOHWWLOEHVN\WWHOVHDIDOPLQ
GHOLJW NXOVWRIVWnODUPHULQJ RJ HU DQYHQGHOLJH WLO EHVN\WWHOVH DI DUPHULQJ L VnYHO Q\H GHOLJW NXOVWRIVWnODUPHULQJ RJ HU DQYHQGHOLJH WLO EHVN\WWHOVH DI DUPHULQJ L VnYHO Q\H
VRPHNVLVWHUHQGHNRQVWUXNWLRQHU'HWI¡UVWHSULQFLSHUEDVHUHWSnRYHUIODGHPRGLILNDWL VRPHNVLVWHUHQGHNRQVWUXNWLRQHU'HWI¡UVWHSULQFLSHUEDVHUHWSnRYHUIODGHPRGLILNDWL
RQ DI DUPHULQJHQ PHQV GHW DQGHW SULQFLS DQYHQGHU Q\H NRQFHSWHU IRU RIIHUDQRGHU RQ DI DUPHULQJHQ PHQV GHW DQGHW SULQFLS DQYHQGHU Q\H NRQFHSWHU IRU RIIHUDQRGHU
%HJJH SULQFLSSHU IRUYHQWHV L EHW\GHOLJ JUDG DW IRUEHGUH EHVN\WWHOVHQ DI NXOVWRIVWnO %HJJH SULQFLSSHU IRUYHQWHV L EHW\GHOLJ JUDG DW IRUEHGUH EHVN\WWHOVHQ DI NXOVWRIVWnO
DUPHULQJLFDUERQDWLVHUHWHOOHUFKORULGKROGLJEHWRQ DUPHULQJLFDUERQDWLVHUHWHOOHUFKORULGKROGLJEHWRQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN YLL 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN YLL


5HVXPp LQ'DQLVK  5HVXPp LQ'DQLVK 

%HJJHEHVN\WWHOVHVSULQFLSSHUKDUWLOIRUPnO DWHWDEOHUH HWWLOSDVVHWODYWNRUURVLRQVSR %HJJHEHVN\WWHOVHVSULQFLSSHUKDUWLOIRUPnO DWHWDEOHUH HWWLOSDVVHWODYWNRUURVLRQVSR


WHQWLDOH 0DWHULDOHNRQFHSWHUQH E\JJHU Sn SURFHVVHU GHU LQWURGXFHUHU PDJQHVLXP RJ WHQWLDOH 0DWHULDOHNRQFHSWHUQH E\JJHU Sn SURFHVVHU GHU LQWURGXFHUHU PDJQHVLXP RJ
]LQN VDPPHQ PHG DQGUH HOHNWURNHPLVN DNWLYH PDWHULDOHU L EHWRQVWnO V\VWHPHW )RU ]LQN VDPPHQ PHG DQGUH HOHNWURNHPLVN DNWLYH PDWHULDOHU L EHWRQVWnO V\VWHPHW )RU
XGHQDWHWDEOHUHHWODYWNRUURVLRQVSRWHQWLDOHIRUEHGUHUGHWI¡UVWHSULQFLSRJVnJU QVH XGHQDWHWDEOHUHHWODYWNRUURVLRQVSRWHQWLDOHIRUEHGUHUGHWI¡UVWHSULQFLSRJVnJU QVH
IODGHQPHOOHPEHWRQRJVWnO IODGHQPHOOHPEHWRQRJVWnO
'HUHUHWDEOHUHWHQIRUV¡JVRSVWLOOLQJWLOHNVSHULPHQWHOXQGHUV¡JHOVHDIGHWI¡UVWHNRUUR 'HUHUHWDEOHUHWHQIRUV¡JVRSVWLOOLQJWLOHNVSHULPHQWHOXQGHUV¡JHOVHDIGHWI¡UVWHNRUUR
VLRQVEHVN\WWHOVHVSULQFLS )RUV¡JHQH EOHY XGI¡UW Sn DUPHULQJVVW QJHU RPVW¡EW PHG VLRQVEHVN\WWHOVHVSULQFLS )RUV¡JHQH EOHY XGI¡UW Sn DUPHULQJVVW QJHU RPVW¡EW PHG
HQWHQP¡UWHOHOOHUFHPHQWSDVWD0¡UWHOSU¡YHUQHPHGLQGVW¡EWHHOHNWURGHUEOHYEUXJWWLO HQWHQP¡UWHOHOOHUFHPHQWSDVWD0¡UWHOSU¡YHUQHPHGLQGVW¡EWHHOHNWURGHUEOHYEUXJWWLO
EHVWHPPHOVHDIRPIDWWHQGHHOHNWURNHPLVNHGDWDIRUDUPHULQJHQRJP¡UWHOPDWUL[HQ(W EHVWHPPHOVHDIRPIDWWHQGHHOHNWURNHPLVNHGDWDIRUDUPHULQJHQRJP¡UWHOPDWUL[HQ(W
DXWRPDWLVHUHWV\VWHPEDVHUHWSn³FOXVWHUPHDVXUHPHQWV´WLOORGGHWDOMHUHWPRQLWHULQJDI DXWRPDWLVHUHWV\VWHPEDVHUHWSn³FOXVWHUPHDVXUHPHQWV´WLOORGGHWDOMHUHWPRQLWHULQJDI
DGVNLOOLJHSU¡YHU0nOLQJDINRUURVLRQVSRWHQWLDOHRJPDNURFHOOHVWU¡PEOHYXGI¡UWNRQ DGVNLOOLJHSU¡YHU0nOLQJDINRUURVLRQVSRWHQWLDOHRJPDNURFHOOHVWU¡PEOHYXGI¡UWNRQ
WLQXHUHW RJ K\SSLJW VXSSOHUHW PHG HOHNWURNHPLVN LPSHGDQV VSHNWURVNRSL &HPHQWSD WLQXHUHW RJ K\SSLJW VXSSOHUHW PHG HOHNWURNHPLVN LPSHGDQV VSHNWURVNRSL &HPHQWSD
VWDSU¡YHUQH VRP NXQQH SURGXFHUHV L VWRUW DQWDO EOHY DQYHQGW WLO LQGOHGHQGH RJ GH VWDSU¡YHUQH VRP NXQQH SURGXFHUHV L VWRUW DQWDO EOHY DQYHQGW WLO LQGOHGHQGH RJ GH
VWUXNWLYHPnOLQJHUIHNVWLOEHVWHPPHOVHDIDQRGLVNHSRODULVHULQJVNXUYHU)RUXGHQGH VWUXNWLYHPnOLQJHUIHNVWLOEHVWHPPHOVHDIDQRGLVNHSRODULVHULQJVNXUYHU)RUXGHQGH
HOHNWURNHPLVNH WHNQLNNHU EOHY NHPLVNH PHWRGHU DQYHQGW WLO IHNV EHVWHPPHOVH DI HOHNWURNHPLVNH WHNQLNNHU EOHY NHPLVNH PHWRGHU DQYHQGW WLO IHNV EHVWHPPHOVH DI
NORULGLQGKROG RJ  QGULQJHU L S+Y UGL 0LNURVNRSL RJ HQHUJLGLVSHUVLY U¡QW NORULGLQGKROG RJ  QGULQJHU L S+Y UGL 0LNURVNRSL RJ HQHUJLGLVSHUVLY U¡QW
JHQVSHNWURVNRSLEOHYEUXJWWLODWLQGVDPOHDIJ¡UHQGHGDWDWLOGHQRPIDWWHQGHWHUPRG\ JHQVSHNWURVNRSLEOHYEUXJWWLODWLQGVDPOHDIJ¡UHQGHGDWDWLOGHQRPIDWWHQGHWHUPRG\
QDPLVNHHYDOXHULQJDIHIIHNWHQDINRUURVLRQVEHVN\WWHOVHQ QDPLVNHHYDOXHULQJDIHIIHNWHQDINRUURVLRQVEHVN\WWHOVHQ
8GYDOJWH HNVSHULPHQWHOOH UHVXOWDWHU HU L UDSSRUWHQ DQYHQGW VRPLOOXVWUDWLRQ RJ GRNX 8GYDOJWH HNVSHULPHQWHOOH UHVXOWDWHU HU L UDSSRUWHQ DQYHQGW VRPLOOXVWUDWLRQ RJ GRNX
PHQWDWLRQDIGHIRUHVOnHGHPHNDQLVPHURJNRQFHSWHU3nJUXQGDIIRUYHQWHGHSDWHQW PHQWDWLRQDIGHIRUHVOnHGHPHNDQLVPHURJNRQFHSWHU3nJUXQGDIIRUYHQWHGHSDWHQW
PXOLJKHGHUHUQRJOHDIGHWHRUHWLVNHNRQFHSWHURJHNVSHULPHQWHOOHUHVXOWDWHULNNHLQ PXOLJKHGHUHUQRJOHDIGHWHRUHWLVNHNRQFHSWHURJHNVSHULPHQWHOOHUHVXOWDWHULNNHLQ
NOXGHUHWLGHQQHDIKDQGOLQJGHYLOEOLYHLQNOXGHUHWLIUHPWLGLJHSXEOLNDWLRQHU NOXGHUHWLGHQQHDIKDQGOLQJGHYLOEOLYHLQNOXGHUHWLIUHPWLGLJHSXEOLNDWLRQHU
 

YLLL 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN YLLL 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 

6\PEROVDQG$EEUHYLDWLRQV 6\PEROVDQG$EEUHYLDWLRQV
)RUWKHSXUSRVHRIWKLVWKHVLVWKHV\PEROVDQGDEEUHYLDWLRQVLQWKHEHORZWDEOHDSSO\ )RUWKHSXUSRVHRIWKLVWKHVLVWKHV\PEROVDQGDEEUHYLDWLRQVLQWKHEHORZWDEOHDSSO\
7KHOLVWLVLQDOSKDEHWLFDORUGHU ILUVW/DWLQWKHQ*UHHN  7KHOLVWLVLQDOSKDEHWLFDORUGHU ILUVW/DWLQWKHQ*UHHN 
7KURXJKRXWWKLVWKHVLVWKHVHV\PEROVDQGDEEUHYLDWLRQVDUHLQGLFDWHGE\VLQJOHTXRWHV 7KURXJKRXWWKLVWKHVLVWKHVHV\PEROVDQGDEEUHYLDWLRQVDUHLQGLFDWHGE\VLQJOHTXRWHV
EXWWKHVLQJOHTXRWHVDUHRPLWWHGLQHTXDWLRQVDQGILJXUHV$VPDOOW\SH³V´LVDGGHGWR EXWWKHVLQJOHTXRWHVDUHRPLWWHGLQHTXDWLRQVDQGILJXUHV$VPDOOW\SH³V´LVDGGHGWR
WKHV\PERORUDEEUHYLDWLRQLILWLVUHIHUUHGWRLQSOXUDO WKHV\PERORUDEEUHYLDWLRQLILWLVUHIHUUHGWRLQSOXUDO

6\PERORU 6\PERORU
6WDQGDUGXQLW 'HILQLWLRQ 6WDQGDUGXQLW 'HILQLWLRQ
DEEUHYLDWLRQ DEEUHYLDWLRQ
µD¶ PRO/ $FWLYLW\ LQWHUPVRIFRQFHQWUDWLRQ  µD¶ PRO/ $FWLYLW\ LQWHUPVRIFRQFHQWUDWLRQ 
µ$65¶  $ONDOLVLOLFDUHDFWLRQ µ$65¶  $ONDOLVLOLFDUHDFWLRQ

µE¶  7DIHOFRQVWDQW  µE¶  7DIHOFRQVWDQW 
µ&¶ PRO/ &RQFHQWUDWLRQRIDFKHPLFDOVSHFLHV µ&¶ PRO/ &RQFHQWUDWLRQRIDFKHPLFDOVSHFLHV
µ&GO¶ $×V9 'RXEOHOD\HUFDSDFLWDQFH µ&GO¶ $×V9 'RXEOHOD\HUFDSDFLWDQFH
µ&(¶  &RXQWHUHOHFWURGH µ&(¶  &RXQWHUHOHFWURGH
µ&S¶ - PRO×.  +HDWFDSDFLW\DWFRQVWDQWSUHVVXUH VSHFLILFKHDW  µ&S¶ - PRO×.  +HDWFDSDFLW\DWFRQVWDQWSUHVVXUH VSHFLILFKHDW 
µ&3¶  &DWKRGLFSURWHFWLRQ µ&3¶  &DWKRGLFSURWHFWLRQ
µ&3UH¶  &DWKRGLFSUHYHQWLRQ µ&3UH¶  &DWKRGLFSUHYHQWLRQ
µ&6+¶  &DOFLXPVLOLFDWHK\GUDWH µ&6+¶  &DOFLXPVLOLFDWHK\GUDWH
µ'¶ PV 'LIIXVLRQFRHIILFLHQW µ'¶ PV 'LIIXVLRQFRHIILFLHQW
µ(¶ 96+( (OHFWURGHSRWHQWLDO VHH&KDSWHUµ7D'¶  µ(¶ 96+( (OHFWURGHSRWHQWLDO VHH&KDSWHUµ7D'¶ 
µ(¶ 96+( (TXLOLEULXPSRWHQWLDO ‚ VHH&KDSWHUµ7D'¶  µ(¶ 96+( (TXLOLEULXPSRWHQWLDO ‚ VHH&KDSWHUµ7D'¶ 
µ('6¶  (QHUJ\GLVSHUVLYH;UD\VSHFWURVFRS\ µ('6¶  (QHUJ\GLVSHUVLYH;UD\VSHFWURVFRS\
µ((:¶  (PEHGGHGHOHFWURGHZLUH µ((:¶  (PEHGGHGHOHFWURGHZLUH
µ(&DW¶  ([WHUQDOFDWKRGH µ(&DW¶  ([WHUQDOFDWKRGH
µ(FRUU¶ 96+( &RUURVLRQSRWHQWLDO VHH&KDSWHUµ7D'¶  µ(FRUU¶ 96+( &RUURVLRQSRWHQWLDO VHH&KDSWHUµ7D'¶ 
µ(&5¶  (OHFWURFKHPLFDOFKORULGHUHPRYDO µ(&5¶  (OHFWURFKHPLFDOFKORULGHUHPRYDO
µ(,6¶  (OHFWURFKHPLFDOLPSHGDQFHVSHFWURVFRS\ µ(,6¶  (OHFWURFKHPLFDOLPSHGDQFHVSHFWURVFRS\
µ(O¶  $UELWUDU\HOHPHQWZLWKLQGH[VSHFLILHGE\³´‚ µ(O¶  $UELWUDU\HOHPHQWZLWKLQGH[VSHFLILHGE\³´‚
µ(0)¶ 96+( (OHFWURPRWLYHIRUFH VHH&KDSWHUµ7D'¶  µ(0)¶ 96+( (OHFWURPRWLYHIRUFH VHH&KDSWHUµ7D'¶ 
µ(SS¶ 96+( 3ULPDU\SDVVLYDWLRQSRWHQWLDO µ(SS¶ 96+( 3ULPDU\SDVVLYDWLRQSRWHQWLDO
µ(SLW¶ 96+( 3LWWLQJSRWHQWLDO VHH&KDSWHUµ7D'¶  µ(SLW¶ 96+( 3LWWLQJSRWHQWLDO VHH&KDSWHUµ7D'¶ 
µ(5$¶  (OHFWURFKHPLFDOUHDONDOLVDWLRQ µ(5$¶  (OHFWURFKHPLFDOUHDONDOLVDWLRQ
µ)¶ $×VPRO )DUDGD\FRQVWDQW î$×VPRO  µ)¶ $×VPRO )DUDGD\FRQVWDQW î$×VPRO 
µ)53¶  )LEUHUHLQIRUFHGSRO\PHU µ)53¶  )LEUHUHLQIRUFHGSRO\PHU
µ*¶ - *LEEVIUHHHQHUJ\‚Á VHH&KDSWHUµ7D'¶  µ*¶ - *LEEVIUHHHQHUJ\‚Á VHH&KDSWHUµ7D'¶ 
µ*I¶ -PRO *LEEVIUHHHQHUJ\RIIRUPDWLRQ‚Á µ*I¶ -PRO *LEEVIUHHHQHUJ\RIIRUPDWLRQ‚Á
µ*5¶  *UHHQUXVWRQH µ*5¶  *UHHQUXVWRQH
‚Á
µ+¶ -PRO (QWKDOS\  µ+¶ -PRO (QWKDOS\‚Á

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN L[ 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN L[


6\PEROVDQG$EEUHYLDWLRQV 6\PEROVDQG$EEUHYLDWLRQV

6\PERORU 6\PERORU
6WDQGDUGXQLW 'HILQLWLRQ 6WDQGDUGXQLW 'HILQLWLRQ
DEEUHYLDWLRQ DEEUHYLDWLRQ
µ+6&¶  6RIWZDUH2XWRNXPSX+6&&KHPLVWU\ µ+6&¶  6RIWZDUH2XWRNXPSX+6&&KHPLVWU\
µ+3&¶  +LJKSHUIRUPDQFHFRQFUHWH µ+3&¶  +LJKSHUIRUPDQFHFRQFUHWH
 
µ,¶ µL¶  $ $P  &XUUHQW GHQVLW\  µ,¶ µL¶  $ $P  &XUUHQW GHQVLW\ 
 
µ,¶ µL¶  $ $P  ([FKDQJHFXUUHQW GHQVLW\  µ,¶ µL¶  $ $P  ([FKDQJHFXUUHQW GHQVLW\ 
µ,FF¶ µLFF¶  $ $P  &ULWLFDOFXUUHQW GHQVLW\  µ,FF¶ µLFF¶  $ $P  &ULWLFDOFXUUHQW GHQVLW\ 
µ,FRUU¶ µLFRUU¶  $ $P  &RUURVLRQFXUUHQW GHQVLW\  µ,FRUU¶ µLFRUU¶  $ $P  &RUURVLRQFXUUHQW GHQVLW\ 
µ,2¶  ,QSXWRXWSXW µ,2¶  ,QSXWRXWSXW
 
µ,S¶ µLS¶  $ $P  3DVVLYHFXUUHQW GHQVLW\  µ,S¶ µLS¶  $ $P  3DVVLYHFXUUHQW GHQVLW\ 
µ/20¶  /LJKWRSWLFDOPLFURVFRS\ µ/20¶  /LJKWRSWLFDOPLFURVFRS\
µ/35¶  /LQHDUSRODULVDWLRQUHVLVWDQFH µ/35¶  /LQHDUSRODULVDWLRQUHVLVWDQFH
µ,7=¶  ,QWHUIDFLDOWUDQVLWLRQ]RQH µ,7=¶  ,QWHUIDFLDOWUDQVLWLRQ]RQH
‚
µ0H¶  $UELWUDU\PHWDOZLWKLQGH[VSHFLILHGE\³´  µ0H¶  $UELWUDU\PHWDOZLWKLQGH[VSHFLILHGE\³´‚
Q Q
µ0H ¶  6SHFLHVRIµ0H¶LQµQ¶WLPHVKLJKHUR[LGDWLRQVWDWH µ0H ¶  6SHFLHVRIµ0H¶LQµQ¶WLPHVKLJKHUR[LGDWLRQVWDWH
µ0(3'¶  0XOWLHOHPHQW3RXUEDL[GLDJUDP  VHH&KDSWHUµ7D'¶  µ0(3'¶  0XOWLHOHPHQW3RXUEDL[GLDJUDP  VHH&KDSWHUµ7D'¶ 
µS¶ 1P 3DUWLDOJDVSUHVVXUH µS¶ 1P 3DUWLDOJDVSUHVVXUH
†
µ3¶  $UELWUDU\SURGXFWZLWKLQGH[VSHFLILHGE\³´  µ3¶  $UELWUDU\SURGXFWZLWKLQGH[VSHFLILHGE\³´†
µ3ULQFLSOH,¶  3ULQFLSOHRILPSOHPHQWDWLRQ, FI6HFWLRQ  µ3ULQFLSOH,¶  3ULQFLSOHRILPSOHPHQWDWLRQ, FI6HFWLRQ 
µ3ULQFLSOH,,¶  3ULQFLSOHRILPSOHPHQWDWLRQ,, FI6HFWLRQ  µ3ULQFLSOH,,¶  3ULQFLSOHRILPSOHPHQWDWLRQ,, FI6HFWLRQ 
µ5¶ - .îPRO  *DVFRQVWDQW - .îPRO  µ5¶ - .îPRO  *DVFRQVWDQW - .îPRO 
µ5(¶  5HIHUHQFHHOHFWURGH µ5(¶  5HIHUHQFHHOHFWURGH
µ5¶  $UELWUDU\UHDFWDQWZLWKLQGH[VSHFLILHGE\³´† µ5¶  $UELWUDU\UHDFWDQWZLWKLQGH[VSHFLILHGE\³´†
µ5S¶ ȍ 3RODULVDWLRQUHVLVWDQFH µ5S¶ ȍ 3RODULVDWLRQUHVLVWDQFH
µ5ȍ¶ ȍ×P 6ROXWLRQRUHOHFWURO\WHUHVLVWDQFH µ5ȍ¶ ȍ×P 6ROXWLRQRUHOHFWURO\WHUHVLVWDQFH
µ6¶ - PRO×.  (QWURS\‚Á µ6¶ - PRO×.  (QWURS\‚Á
µ6&(¶  6DWXUDWHGFDORPHOHOHFWURGH µ6&(¶  6DWXUDWHGFDORPHOHOHFWURGH
µ6(0¶  6FDQQLQJHOHFWURQPLFURVFRS\ µ6(0¶  6FDQQLQJHOHFWURQPLFURVFRS\
µ6(3'¶  6LQJOHHOHPHQW3RXUEDL[GLDJUDP VHH&KDSWHUµ7D'¶  µ6(3'¶  6LQJOHHOHPHQW3RXUEDL[GLDJUDP VHH&KDSWHUµ7D'¶ 
µ6+(¶  6WDQGDUGK\GURJHQHOHFWURGH µ6+(¶  6WDQGDUGK\GURJHQHOHFWURGH
µ6,3'¶  6XSHULPSRVHG3RXUEDL[GLDJUDP VHH&KDSWHUµ7D'¶  µ6,3'¶  6XSHULPSRVHG3RXUEDL[GLDJUDP VHH&KDSWHUµ7D'¶ 
µW¶ 6 7LPH µW¶ 6 7LPH
µ7¶ . 7HPSHUDWXUH µ7¶ . 7HPSHUDWXUH
µ7D'¶  &KDSWHU³7HUPLQRORJ\DQG'HILQLWLRQV´LQWKLVWKHVLV µ7D'¶  &KDSWHU³7HUPLQRORJ\DQG'HILQLWLRQV´LQWKLVWKHVLV
µ7HVW,¶  ([SHULPHQWDOLQYHVWLJDWLRQV, FI6HFWLRQ  µ7HVW,¶  ([SHULPHQWDOLQYHVWLJDWLRQV, FI6HFWLRQ 
µ7HVW,,¶  ([SHULPHQWDOLQYHVWLJDWLRQV,, FI6HFWLRQ  µ7HVW,,¶  ([SHULPHQWDOLQYHVWLJDWLRQV,, FI6HFWLRQ 
µY¶  6WRLFKLRPHWULFFRHIILFLHQW µY¶  6WRLFKLRPHWULFFRHIILFLHQW
µ:¶ ȍ×Víò :DUEXUJLPSHGDQFH µ:¶ ȍ×Víò :DUEXUJLPSHGDQFH
µ:(¶  :RUNLQJHOHFWURGH µ:(¶  :RUNLQJHOHFWURGH
µZF¶  :DWHUWRFHPHQWUDWLR µZF¶  :DWHUWRFHPHQWUDWLR
µZZ¶  :HLJKWE\ZHLJKW‚‚ µZZ¶  :HLJKWE\ZHLJKW‚‚
µ[¶ 0 'LVWDQFHOHQJWKRUGHSWK µ[¶ 0 'LVWDQFHOHQJWKRUGHSWK
µ=¶ ȍ ,PSHGDQFH  µ=¶ ȍ ,PSHGDQFH 

[ 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [ 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN
 6\PEROVDQG$EEUHYLDWLRQV  6\PEROVDQG$EEUHYLDWLRQV

6\PERORU 6\PERORU
6WDQGDUGXQLW 'HILQLWLRQ 6WDQGDUGXQLW 'HILQLWLRQ
DEEUHYLDWLRQ DEEUHYLDWLRQ
µ¨(¶ 9 3RWHQWLDOGLIIHUHQFH VHH&KDSWHUµ7D'¶  µ¨(¶ 9 3RWHQWLDOGLIIHUHQFH VHH&KDSWHUµ7D'¶ 
µ¨(¶ 9 (TXLOLEULXPSRWHQWLDOGLIIHUHQFH VHH&KDSWHUµ7D'¶  µ¨(¶ 9 (TXLOLEULXPSRWHQWLDOGLIIHUHQFH VHH&KDSWHUµ7D'¶ 
µ¨(S¶ 9 3RWHQWLDOSHUWXUEDWLRQ µ¨(S¶ 9 3RWHQWLDOSHUWXUEDWLRQ
µ¨,S¶ µ¨LS¶  $ $P  &XUUHQW GHQVLW\ UHVSRQVH µ¨,S¶ µ¨LS¶  $ $P  &XUUHQW GHQVLW\ UHVSRQVH
µȘ¶ 9 2YHUSRWHQWLDO ÁÁ µȘ¶ 9 2YHUSRWHQWLDO ÁÁ
µij¶  UDG  3KDVHDQJOHVKLIW µij¶  UDG  3KDVHDQJOHVKLIW
µȦ¶ V LQUDGV  $QJXODUIUHTXHQF\ µȦ¶ V LQUDGV  $QJXODUIUHTXHQF\
 


 7KHVXEVFULSWV³D´DQG³E´UHIHUWRWKHDQRGLFDQGWKHFDWKRGLFSDUDPHWHUUHVSHFWLYHO\  7KHVXEVFULSWV³D´DQG³E´UHIHUWRWKHDQRGLFDQGWKHFDWKRGLFSDUDPHWHUUHVSHFWLYHO\
‚ ‚
 7KHVXSHUVFULSW³´UHIHUVWRWKHSDUDPHWHUDWVWDQGDUGVWDWH  7KHVXSHUVFULSW³´UHIHUVWRWKHSDUDPHWHUDWVWDQGDUGVWDWH
Á Á
 7KHSUHIL[³¨´UHIHUVWRWKHFKDQJHRIWKHSDUDPHWHU  7KHSUHIL[³¨´UHIHUVWRWKHFKDQJHRIWKHSDUDPHWHU
† †
7KHLQGH[³´UHSUHVHQWVDQ\LQWHJHURU³]´WKDWFRUUHVSRQGVWRWKHHQGRIDOLVW³´LVRPLWWHGLIWKH 7KHLQGH[³´UHSUHVHQWVDQ\LQWHJHURU³]´WKDWFRUUHVSRQGVWRWKHHQGRIDOLVW³´LVRPLWWHGLIWKH
DVVRFLDWHGSDUDPHWHULVOLPLWHGWRRQHLQVWDQFH DVVRFLDWHGSDUDPHWHULVOLPLWHGWRRQHLQVWDQFH

7KHVXEVFULSWV³M´DQG³U´UHIHUWRWKHLPDJLQDU\DQGWKHUHDOSDUWRILPSHQGHQFH 7KHVXEVFULSWV³M´DQG³U´UHIHUWRWKHLPDJLQDU\DQGWKHUHDOSDUWRILPSHQGHQFH
‚‚ ‚‚
7KHVXEVFULSWV³FR´DQG³FH´UHIHUWRRYHQGU\FRQFUHWHDQGWRWKHFHPHQWFRQWHQWUHVSHFWLYHO\ 7KHVXEVFULSWV³FR´DQG³FH´UHIHUWRRYHQGU\FRQFUHWHDQGWRWKHFHPHQWFRQWHQWUHVSHFWLYHO\
ÁÁ ÁÁ
7KHVXEVFULSWV³DFW´³FRQ´DQG³UHV´UHIHUWRWKHDFWLYDWLRQWKHFRQFHQWUDWLRQDQGWKHUHVLVWDQFH 7KHVXEVFULSWV³DFW´³FRQ´DQG³UHV´UHIHUWRWKHDFWLYDWLRQWKHFRQFHQWUDWLRQDQGWKHUHVLVWDQFH
RYHUSRWHQWLDOUHVSHFWLYHO\ RYHUSRWHQWLDOUHVSHFWLYHO\

 
6,XQLWVDUHXVHGWKURXJKRXWWKLVWKHVLV1XPHULFDOYDOXHVDUHJLYHQEDVHGRQFRQYHQ 6,XQLWVDUHXVHGWKURXJKRXWWKLVWKHVLV1XPHULFDOYDOXHVDUHJLYHQEDVHGRQFRQYHQ
LHQWVFDOHVHJSRWHQWLDOV>P96+(@HQHUJLHV>N-@FXUUHQWV>P$@SUHVVXUH>EDU@WHP LHQWVFDOHVHJSRWHQWLDOV>P96+(@HQHUJLHV>N-@FXUUHQWV>P$@SUHVVXUH>EDU@WHP
SHUDWXUH>ƒ&@DQGOHQJWKVDUHDVYROXPHVLQDQ\DSSURSULDWHRUGHURIPDJQLWXGH SHUDWXUH>ƒ&@DQGOHQJWKVDUHDVYROXPHVLQDQ\DSSURSULDWHRUGHURIPDJQLWXGH
2QO\ V\PEROV DQG DEEUHYLDWLRQV WKDW DUH RI UHOHYDQFH WKURXJKRXW WKLV WKHVLV DUH LQ 2QO\ V\PEROV DQG DEEUHYLDWLRQV WKDW DUH RI UHOHYDQFH WKURXJKRXW WKLV WKHVLV DUH LQ
FOXGHGLQWKHDERYHWDEOH6WDQGDUGDEEUHYLDWLRQVV\PEROVZLWKPDUJLQDOLPSRUWDQFH FOXGHGLQWKHDERYHWDEOH6WDQGDUGDEEUHYLDWLRQVV\PEROVZLWKPDUJLQDOLPSRUWDQFH
RU DOWHUQDWLYH V\PEROV RU DEEUHYLDWLRQV ZKLFK GLIIHU IURP WKH RQHV GHILQHG LQ WKH RU DOWHUQDWLYH V\PEROV RU DEEUHYLDWLRQV ZKLFK GLIIHU IURP WKH RQHV GHILQHG LQ WKH
DERYH WDEOH LQFOXGHG IRU LQIRUPDWLRQ SXUSRVHV RQO\  DUH VWDWHG LQ SDUHQWKHVLV ZLWK DERYH WDEOH LQFOXGHG IRU LQIRUPDWLRQ SXUSRVHV RQO\  DUH VWDWHG LQ SDUHQWKHVLV ZLWK
VLQJOHTXRWHVLH µV\PERORUDEEUHYLDWLRQ¶  VLQJOHTXRWHVLH µV\PERORUDEEUHYLDWLRQ¶ 
7KH IRUPXODV RI WKH PRVW LPSRUWDQW FKHPLFDO VSHFLHV PHQWLRQHG LQ WKLV WKHVLV DUH 7KH IRUPXODV RI WKH PRVW LPSRUWDQW FKHPLFDO VSHFLHV PHQWLRQHG LQ WKLV WKHVLV DUH
OLVWHGWRJHWKHUZLWKWKHQDPHVRIWKHFRUUHVSRQGLQJHOHPHQWVRUFRPSRXQGVDWWKHHQG OLVWHGWRJHWKHUZLWKWKHQDPHVRIWKHFRUUHVSRQGLQJHOHPHQWVRUFRPSRXQGVDWWKHHQG
RIWKLVWKHVLV &KDSWHU³/LVWRI&KHPLFDO6SHFLHV´ ,QFRQWUDVWWRWKHDERYHOLVWHGDE RIWKLVWKHVLV &KDSWHU³/LVWRI&KHPLFDO6SHFLHV´ ,QFRQWUDVWWRWKHDERYHOLVWHGDE
EUHYLDWLRQVIRUPXODVRIFKHPLFDOVSHFLHVDUHQRWPDUNHGE\VLQJOHTXRWHV7KHVDPH EUHYLDWLRQVIRUPXODVRIFKHPLFDOVSHFLHVDUHQRWPDUNHGE\VLQJOHTXRWHV7KHVDPH
KROGV IRU HOHPHQWV ZLWK D VXEVFULSW ³LD´ ZKLFK LQGLFDWHV WKDW WKH LRQ DFWLYLW\ RI WKH KROGV IRU HOHPHQWV ZLWK D VXEVFULSW ³LD´ ZKLFK LQGLFDWHV WKDW WKH LRQ DFWLYLW\ RI WKH
DVVRFLDWHGHOHPHQWLVUHIHUUHGWR,WVKRXOGDOVREHQRWHGWKDWIRUPXODVDQGWKHFRUUH DVVRFLDWHGHOHPHQWLVUHIHUUHGWR,WVKRXOGDOVREHQRWHGWKDWIRUPXODVDQGWKHFRUUH
VSRQGLQJQDPHVRIHOHPHQWVRUFRPSRXQGVDUHXVHGLQWHUFKDQJHDEO\)RUPXODVXVHG VSRQGLQJQDPHVRIHOHPHQWVRUFRPSRXQGVDUHXVHGLQWHUFKDQJHDEO\)RUPXODVXVHG
DVVXEVFULSWLQGLFDWHWKDWWKHSDUDPHWHUUHIHUVWRWKDWVSHFLHVHJµ'&O¶LVWKHFKORULGH DVVXEVFULSWLQGLFDWHWKDWWKHSDUDPHWHUUHIHUVWRWKDWVSHFLHVHJµ'&O¶LVWKHFKORULGH
GLIIXVLRQFRHIILFLHQWDQGµS2¶LVWKHSDUWLDOR[\JHQSUHVVXUH GLIIXVLRQFRHIILFLHQWDQGµS2¶LVWKHSDUWLDOR[\JHQSUHVVXUH
6WDQGDUGDEEUHYLDWLRQVIRURUJDQLVDWLRQVDUHQHLWKHUPDUNHGE\VLQJOHTXRWHVQRULQ 6WDQGDUGDEEUHYLDWLRQVIRURUJDQLVDWLRQVDUHQHLWKHUPDUNHGE\VLQJOHTXRWHVQRULQ
FOXGHGLQWKHDERYHWDEOHEXWWKHPRVWLPSRUWDQWRQHVDUHHOXFLGDWHGE\IRRWQRWHV FOXGHGLQWKHDERYHWDEOHEXWWKHPRVWLPSRUWDQWRQHVDUHHOXFLGDWHGE\IRRWQRWHV
 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [L 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [L


 

7HUPLQRORJ\DQG'HILQLWLRQV 7HUPLQRORJ\DQG'HILQLWLRQV
$VIDUDVSRVVLEOHDQGDSSOLFDEOHWKHHOHFWURFKHPLFDODQGFKHPLFDOWHUPLQRORJ\DQG $VIDUDVSRVVLEOHDQGDSSOLFDEOHWKHHOHFWURFKHPLFDODQGFKHPLFDOWHUPLQRORJ\DQG
GHILQLWLRQVXVHGLQWKLVWKHVLVFRUUHVSRQGWRWKHRQHVVSHFLILHGLQ>,83$&@ DQG GHILQLWLRQVXVHGLQWKLVWKHVLVFRUUHVSRQGWRWKHRQHVVSHFLILHGLQ>,83$&@ DQG
LQ$670>$670*@‚DQGWRDGGLWLRQDO$670VWDQGDUGVIRUWKHUHOHYDQWWHVW LQ$670>$670*@‚DQGWRDGGLWLRQDO$670VWDQGDUGVIRUWKHUHOHYDQWWHVW
PHWKRGV7KHWHUPLQRORJ\XVHGIRUWKHGHVFULSWLRQVRIFRQFUHWH HJFRQVWLWXHQWVDQG PHWKRGV7KHWHUPLQRORJ\XVHGIRUWKHGHVFULSWLRQVRIFRQFUHWH HJFRQVWLWXHQWVDQG
SURSHUWLHV LVODUJHO\LQDJUHHPHQWZLWKWKHRQHUHFRPPHQGHGLQ>$&,5@Á SURSHUWLHV LVODUJHO\LQDJUHHPHQWZLWKWKHRQHUHFRPPHQGHGLQ>$&,5@Á
DQGLQ>$670&@0RUHRYHUVRPHFXVWRPWHUPLQRORJ\DQGGHILQLWLRQVDUH DQGLQ>$670&@0RUHRYHUVRPHFXVWRPWHUPLQRORJ\DQGGHILQLWLRQVDUH
XVHG7KHPRVWLPSRUWDQWWHUPVDQGGHILQLWLRQVZKLFKDUHHLWKHUQRWXVHGLQWKHOLWHUD XVHG7KHPRVWLPSRUWDQWWHUPVDQGGHILQLWLRQVZKLFKDUHHLWKHUQRWXVHGLQWKHOLWHUD
WXUHRUGLIIHUIURPWKHJHQHUDOXVHDUHOLVWHGDQGGHVFULEHGLQWKHIROORZLQJ WXUHRUGLIIHUIURPWKHJHQHUDOXVHDUHOLVWHGDQGGHVFULEHGLQWKHIROORZLQJ
‡ 5HIHUULQJWRUHDFWLRQV ‡ 5HIHUULQJWRUHDFWLRQV
7KH IROORZLQJ WHUPV DUH XVHG WR GLVWLQJXLVK EHWZHHQ WKUHH PDLQ JURXSV RI UHDF 7KH IROORZLQJ WHUPV DUH XVHG WR GLVWLQJXLVK EHWZHHQ WKUHH PDLQ JURXSV RI UHDF
WLRQVWKDWDUHUHOHYDQWIRUWKHGHVFULSWLRQRIFRUURVLRQSURFHVVHVLQWKLVWKHVLV WLRQVWKDWDUHUHOHYDQWIRUWKHGHVFULSWLRQRIFRUURVLRQSURFHVVHVLQWKLVWKHVLV
ƕ 5HGR[UHDFWLRQV ƕ 5HGR[UHDFWLRQV
2QO\ WKRVH HOHFWURFKHPLFDO UHDFWLRQV LQ ZKLFK DWRPV KDYH WKHLU R[LGDWLRQ 2QO\ WKRVH HOHFWURFKHPLFDO UHDFWLRQV LQ ZKLFK DWRPV KDYH WKHLU R[LGDWLRQ
VWDWH†FKDQJHGDQGZKLFKDUHEDODQFHGIRUWKHFKDUJHWUDQVIHUDUHUHIHUUHGWRDV VWDWH†FKDQJHGDQGZKLFKDUHEDODQFHGIRUWKHFKDUJHWUDQVIHUDUHUHIHUUHGWRDV
UHGR[ UHGXFWLRQR[LGDWLRQ UHDFWLRQV UHGR[ UHGXFWLRQR[LGDWLRQ UHDFWLRQV
ƕ $FLGEDVHUHDFWLRQV ƕ $FLGEDVHUHDFWLRQV
&KHPLFDO UHDFWLRQV WKDW GR QRW LQYROYH D FKDQJH LQ R[LGDWLRQ VWDWH DQG RQO\ &KHPLFDO UHDFWLRQV WKDW GR QRW LQYROYH D FKDQJH LQ R[LGDWLRQ VWDWH DQG RQO\
GHVFULEHWKHH[FKDQJHRIERQGVEHWZHHQWKHUHDFWLQJFKHPLFDOVSHFLHVGHSHQG GHVFULEHWKHH[FKDQJHRIERQGVEHWZHHQWKHUHDFWLQJFKHPLFDOVSHFLHVGHSHQG
LQJRQWKHHOHFWURO\WHS+DUHUHIHUUHGWRDVDFLGEDVHUHDFWLRQV LQJRQWKHHOHFWURO\WHS+DUHUHIHUUHGWRDVDFLGEDVHUHDFWLRQV
ƕ +DOIFHOOUHDFWLRQV ƕ +DOIFHOOUHDFWLRQV
(OHFWURFKHPLFDOUHDFWLRQVZKLFKFRPSULVHDVLQJOHSDUWRIDUHGR[FRXSOH UH (OHFWURFKHPLFDOUHDFWLRQVZKLFKFRPSULVHDVLQJOHSDUWRIDUHGR[FRXSOH UH
GXFWLRQR[LGDWLRQ LHUHDFWLRQVZLWKDQHOHFWURQRQHLWKHUVLGHDUHUHIHUUHGWR GXFWLRQR[LGDWLRQ LHUHDFWLRQVZLWKDQHOHFWURQRQHLWKHUVLGHDUHUHIHUUHGWR
DVKDOIFHOOUHDFWLRQV7KHSUHIL[KDOIFHOOLVRPLWWHGZKHQDKDOIFHOOUHDFWLRQ DVKDOIFHOOUHDFWLRQV7KHSUHIL[KDOIFHOOLVRPLWWHGZKHQDKDOIFHOOUHDFWLRQ
LVUHIHUUHGWRDVDQDQRGLFRUFDWKRGLFUHDFWLRQDQGWRDVDQR[LGDWLRQRUUHGXF LVUHIHUUHGWRDVDQDQRGLFRUFDWKRGLFUHDFWLRQDQGWRDVDQR[LGDWLRQRUUHGXF
WLRQUHDFWLRQVLQFHWKHVHWHUPVLPSO\WKDWWKHDVVRFLDWHGUHDFWLRQLVDKDOIFHOO WLRQUHDFWLRQVLQFHWKHVHWHUPVLPSO\WKDWWKHDVVRFLDWHGUHDFWLRQLVDKDOIFHOO
UHDFWLRQ HJDQRGLFUHDFWLRQLVXVHGLQVWHDGRIDQRGLFKDOIFHOOUHDFWLRQ  UHDFWLRQ HJDQRGLFUHDFWLRQLVXVHGLQVWHDGRIDQRGLFKDOIFHOOUHDFWLRQ 
,WVKRXOGEHQRWHGWKDWWKHDERYHWHUPVDSSO\WRJURXSVRIUHDFWLRQVDVRSSRVHGWR ,WVKRXOGEHQRWHGWKDWWKHDERYHWHUPVDSSO\WRJURXSVRIUHDFWLRQVDVRSSRVHGWR
W\SHVRIUHDFWLRQV7KHWHUPW\SHLVXVHGWRUHIHUWRDFHUWDLQUHDFWLRQLQDJURXS W\SHVRIUHDFWLRQV7KHWHUPW\SHLVXVHGWRUHIHUWRDFHUWDLQUHDFWLRQLQDJURXS
HJWKHDQRGLFUHDFWLRQGHVFULELQJWKHUHGXFWLRQRIIHUURXVLRQWRLURQDQGWKHFD HJWKHDQRGLFUHDFWLRQGHVFULELQJWKHUHGXFWLRQRIIHUURXVLRQWRLURQDQGWKHFD

 

 ,QWHUQDWLRQDO8QLRQRI3XUHDQG$SSOLHG&KHPLVWU\ ,83$& 5HVHDUFK7ULDQJOH3DUN1&86$  ,QWHUQDWLRQDO8QLRQRI3XUHDQG$SSOLHG&KHPLVWU\ ,83$& 5HVHDUFK7ULDQJOH3DUN1&86$
‚ ‚
$670,QWHUQDWLRQDO $670 IRUPHUO\NQRZQDVWKH$PHULFDQ6RFLHW\IRU7HVWLQJDQG0DWHULDOV $670,QWHUQDWLRQDO $670 IRUPHUO\NQRZQDVWKH$PHULFDQ6RFLHW\IRU7HVWLQJDQG0DWHULDOV
:HVW&RQVKRKRFNHQ3$86$ :HVW&RQVKRKRFNHQ3$86$
Á Á
 $PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$  $PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$
† †
7KHWHUPR[LGDWLRQVWDWHLVSUHIHUUHGWRWKHWHUPVYDOHQFHRUR[LGDWLRQQXPEHUDQGXVHGWKURXJKRXW 7KHWHUPR[LGDWLRQVWDWHLVSUHIHUUHGWRWKHWHUPVYDOHQFHRUR[LGDWLRQQXPEHUDQGXVHGWKURXJKRXW
WKLVWKHVLV WKLVWKHVLV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [LLL 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [LLL


7HUPLQRORJ\DQG'HILQLWLRQV 7HUPLQRORJ\DQG'HILQLWLRQV

WKRGLFUHDFWLRQGHVFULELQJWKHUHGXFWLRQRIIHUULFLRQWRLURQDUHWZRGLIIHUHQWW\SHV WKRGLFUHDFWLRQGHVFULELQJWKHUHGXFWLRQRIIHUULFLRQWRLURQDUHWZRGLIIHUHQWW\SHV
RIUHDFWLRQVWKDWEHORQJWRWKHJURXSRIKDOIFHOOUHDFWLRQV  RIUHDFWLRQVWKDWEHORQJWRWKHJURXSRIKDOIFHOOUHDFWLRQV 
‡ 5HIHUULQJWRVHTXHQFHVRIUHDFWLRQV ‡ 5HIHUULQJWRVHTXHQFHVRIUHDFWLRQV
$VWHSE\VWHSVHTXHQFHRIUHDFWLRQVE\ZKLFKDQRYHUDOOFKDQJHRFFXUVLVUHIHUUHG $VWHSE\VWHSVHTXHQFHRIUHDFWLRQVE\ZKLFKDQRYHUDOOFKDQJHRFFXUVLVUHIHUUHG
WR DV D UHDFWLRQ PHFKDQLVP >0DUFK @ ,Q WKLV WKHVLV D UHDFWLRQ PHFKDQLVP WR DV D UHDFWLRQ PHFKDQLVP >0DUFK @ ,Q WKLV WKHVLV D UHDFWLRQ PHFKDQLVP
FDQDOVRFRQVWLWXWHDVHTXHQFHRIDQRGLFUHDFWLRQVZLWKRXWWDNLQJLQWRDFFRXQWWKH FDQDOVRFRQVWLWXWHDVHTXHQFHRIDQRGLFUHDFWLRQVZLWKRXWWDNLQJLQWRDFFRXQWWKH
DVVRFLDWHG FDWKRGLF UHDFWLRQV ,Q WKLV FDVH LW LV UHIHUUHG WR DV DQ DQRGLF UHDFWLRQ DVVRFLDWHG FDWKRGLF UHDFWLRQV ,Q WKLV FDVH LW LV UHIHUUHG WR DV DQ DQRGLF UHDFWLRQ
PHFKDQLVP PHFKDQLVP
‡ 7KHUPRG\QDPLFVWDWHV ‡ 7KHUPRG\QDPLFVWDWHV
7KH IROORZLQJ WHUPLQRORJ\ ZKLFK LV ODUJHO\ LQ DJUHHPHQW ZLWK WKH GHILQLWLRQV 7KH IROORZLQJ WHUPLQRORJ\ ZKLFK LV ODUJHO\ LQ DJUHHPHQW ZLWK WKH GHILQLWLRQV
JLYHQLQ>3RXUEDL[E@LVXVHGWRGHVFULEHDQGUHIHUWRWKHGLIIHUHQWWKHUPR JLYHQLQ>3RXUEDL[E@LVXVHGWRGHVFULEHDQGUHIHUWRWKHGLIIHUHQWWKHUPR
G\QDPLFVWDWHVRIDPHWDO G\QDPLFVWDWHVRIDPHWDO
ƕ ,PPXQLW\RULPPXQHVWDWH ƕ ,PPXQLW\RULPPXQHVWDWH
7KHWHUPVLPPXQLW\RULPPXQHVWDWHUHIHUWRWKHVWDWHRIDPHWDOLQZKLFKFRU 7KHWHUPVLPPXQLW\RULPPXQHVWDWHUHIHUWRWKHVWDWHRIDPHWDOLQZKLFKFRU
URVLRQLVWKHUPRG\QDPLFDOO\LPSRVVLEOHLQDJLYHQHQYLURQPHQW URVLRQLVWKHUPRG\QDPLFDOO\LPSRVVLEOHLQDJLYHQHQYLURQPHQW
ƕ &RUURVLRQDFWLYHFRUURVLRQDFWLYH FRUURVLRQ VWDWH ƕ &RUURVLRQDFWLYHFRUURVLRQDFWLYH FRUURVLRQ VWDWH
7KH WHUPV FRUURVLRQ DFWLYH FRUURVLRQ RU DFWLYH FRUURVLRQ  VWDWH UHIHU WR WKH 7KH WHUPV FRUURVLRQ DFWLYH FRUURVLRQ RU DFWLYH FRUURVLRQ  VWDWH UHIHU WR WKH
UHDFWLRQ RI D PHWDO ZLWKLWVQRQPHWDOOLF HQYLURQPHQW WKDW UHVXOWVLQWKH FRQ UHDFWLRQRIDPHWDOZLWKLWVQRQPHWDOOLF HQYLURQPHQW WKDW UHVXOWVLQWKH FRQ
WLQXLQJGHVWUXFWLRQRIWKHPHWDO WLQXLQJGHVWUXFWLRQRIWKHPHWDO
ƕ 3DVVLYLW\RUSDVVLYHVWDWH ƕ 3DVVLYLW\RUSDVVLYHVWDWH
7KHWHUPVSDVVLYLW\RUSDVVLYHVWDWHUHIHUWRWKHVWDWHRIDPHWDOLQZKLFKDFWLYH 7KHWHUPVSDVVLYLW\RUSDVVLYHVWDWHUHIHUWRWKHVWDWHRIDPHWDOLQZKLFKDFWLYH
FRUURVLRQLQDJLYHQHQYLURQPHQWLVSUHYHQWHGE\WKHIRUPDWLRQRIDWKLQSUR FRUURVLRQLQDJLYHQHQYLURQPHQWLVSUHYHQWHGE\WKHIRUPDWLRQRIDWKLQSUR
WHFWLYHOD\HURILWVR[LGHVZKLFKLVJHQHUDOO\UHIHUUHGWRDVDSDVVLYHOD\HULQ WHFWLYHOD\HURILWVR[LGHVZKLFKLVJHQHUDOO\UHIHUUHGWRDVDSDVVLYHOD\HULQ
WKHSUHVHQWWKHVLV WKHSUHVHQWWKHVLV
ƕ 3DVVLYDWLRQ ƕ 3DVVLYDWLRQ
7KH WHUP SDVVLYDWLRQ UHIHUV WR WKH SURFHVV WKDW OHDGV WR PRUH RU OHVV SHUIHFW 7KH WHUP SDVVLYDWLRQ UHIHUV WR WKH SURFHVV WKDW OHDGV WR PRUH RU OHVV SHUIHFW
SDVVLYLW\ RI D PHWDO 3DVVLYDWLRQ FDQ EH REWDLQHG E\ HOHFWURFKHPLFDO PHDQV SDVVLYLW\ RI D PHWDO 3DVVLYDWLRQ FDQ EH REWDLQHG E\ HOHFWURFKHPLFDO PHDQV
HJE\DQRGLFSRODULVDWLRQ RUE\FKHPLFDOPHDQV HJE\FKDQJLQJWKHHOHF HJE\DQRGLFSRODULVDWLRQ RUE\FKHPLFDOPHDQV HJE\FKDQJLQJWKHHOHF
WURO\WHS+  WURO\WHS+ 
‡ 6WDQGDUGVWDWHDQGQRQVWDQGDUGVWDWHFRQGLWLRQV ‡ 6WDQGDUGVWDWHDQGQRQVWDQGDUGVWDWHFRQGLWLRQV
ƕ 6WDQGDUGVWDWHFRQGLWLRQVFRUUHVSRQGWR ƕ 6WDQGDUGVWDWHFRQGLWLRQVFRUUHVSRQGWR
x $QDFWLYLW\RIPRO/IRUHDFKLRQSDUWLFLSDWLQJLQWKHUHDFWLRQ x $QDFWLYLW\RIPRO/IRUHDFKLRQSDUWLFLSDWLQJLQWKHUHDFWLRQ
x $WHPSHUDWXUHRIƒ& .  x $WHPSHUDWXUHRIƒ& . 

[LY 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [LY 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 7HUPLQRORJ\DQG'HILQLWLRQV  7HUPLQRORJ\DQG'HILQLWLRQV

x $SUHVVXUHRIEDU  1P IRUHDFKJDVWKDWWDNHVSDUWLQWKHUHDFWLRQ x $SUHVVXUHRIEDU  1P IRUHDFKJDVWKDWWDNHVSDUWLQWKHUHDFWLRQ


x $OOLQYROYHGVSHFLHVDUHLQWKHLUVWDEOHIRUPXQGHUWKHVHFRQGLWLRQV x $OOLQYROYHGVSHFLHVDUHLQWKHLUVWDEOHIRUPXQGHUWKHVHFRQGLWLRQV
6WDQGDUGVWDWHFRQGLWLRQVDUHPDUNHGZLWKDVXSHUVFULSW³´ 6WDQGDUGVWDWHFRQGLWLRQVDUHPDUNHGZLWKDVXSHUVFULSW³´
ƕ $FWLYLWLHVµD¶IRUQRQVWDQGDUGVWDWHFRQGLWLRQVDUHDSSUR[LPDWHGDFFRUGLQJWR ƕ $FWLYLWLHVµD¶IRUQRQVWDQGDUGVWDWHFRQGLWLRQVDUHDSSUR[LPDWHGDFFRUGLQJWR
x )RUJDVHVµD¶FRUUHVSRQGVWRWKHSDUWLDOSUHVVXUHµS¶LQ>EDU@ x )RUJDVHVµD¶FRUUHVSRQGVWRWKHSDUWLDOSUHVVXUHµS¶LQ>EDU@
x )RUVROLGPDWWHUDQGVROYHQWVµD¶FRUUHVSRQGVWR x )RUVROLGPDWWHUDQGVROYHQWVµD¶FRUUHVSRQGVWR
x )RUGLVVROYHGPDWWHU LRQLFVSHFLHV µD¶FRUUHVSRQGVWRWKHLRQFRQFHQWUD x )RUGLVVROYHGPDWWHU LRQLFVSHFLHV µD¶FRUUHVSRQGVWRWKHLRQFRQFHQWUD
WLRQLQ>PRO/@,IQRWVWDWHGRWKHUZLVHWKHLRQDFWLYLW\IRUQXPHULFDOYDO WLRQLQ>PRO/@,IQRWVWDWHGRWKHUZLVHWKHLRQDFWLYLW\IRUQXPHULFDOYDO
XHVVWDWHGIRUQRQVWDQGDUGVWDWHV DQG IRU 3RXUEDL[ GLDJUDPV FRUUHVSRQGV XHVVWDWHGIRUQRQVWDQGDUGVWDWHV DQG IRU 3RXUEDL[ GLDJUDPV FRUUHVSRQGV
WRíPRO/ WRíPRO/
‡ 5HIHUULQJWRHOHFWURFKHPLFDOSRWHQWLDOV ‡ 5HIHUULQJWRHOHFWURFKHPLFDOSRWHQWLDOV
,WDSSHDUVWKDWWKHUHDUHSDUWLFXODUGLVFUHSDQFLHVZKHQUHIHUULQJWRHOHFWURFKHPLFDO ,WDSSHDUVWKDWWKHUHDUHSDUWLFXODUGLVFUHSDQFLHVZKHQUHIHUULQJWRHOHFWURFKHPLFDO
SRWHQWLDOLQWKHOLWHUDWXUHZKLFKFDQEHPLVOHDGLQJ7KHUHIRUHWKHIROORZLQJWHUPV SRWHQWLDOLQWKHOLWHUDWXUHZKLFKFDQEHPLVOHDGLQJ7KHUHIRUHWKHIROORZLQJWHUPV
DUHXVHGFRQVLVWHQWO\WRGLVWLQJXLVKEHWZHHQGLIIHUHQWW\SHVRIWKHHOHFWURFKHPLFDO DUHXVHGFRQVLVWHQWO\WRGLVWLQJXLVKEHWZHHQGLIIHUHQWW\SHVRIWKHHOHFWURFKHPLFDO
SRWHQWLDO SRWHQWLDO
ƕ (OHFWURGHSRWHQWLDOµ(¶ ƕ (OHFWURGHSRWHQWLDOµ(¶
7KH HOHFWURGH SRWHQWLDO µ(¶ LV GHILQHG DV WKH GLIIHUHQFH EHWZHHQ WKH HOHFWUR 7KH HOHFWURGH SRWHQWLDO µ(¶ LV GHILQHG DV WKH GLIIHUHQFH EHWZHHQ WKH HOHFWUR
FKHPLFDO SRWHQWLDO RI D PHWDOOLF HOHFWURGH LQ DQ HOHFWURO\WH DQG WKH HOHFWUR FKHPLFDO SRWHQWLDO RI D PHWDOOLF HOHFWURGH LQ DQ HOHFWURO\WH DQG WKH HOHFWUR
FKHPLFDOSRWHQWLDORIDUHYHUVLEOHUHIHUHQFHHOHFWURGHLQFRQWDFWZLWKWKLVHOHF FKHPLFDOSRWHQWLDORIDUHYHUVLEOHUHIHUHQFHHOHFWURGHLQFRQWDFWZLWKWKLVHOHF
WURO\WH>3RXUEDL[E@7KHVHOHFWHGSRLQWRIUHIHUHQFHLQWKLVWKHVLVFRUUH WURO\WH>3RXUEDL[E@7KHVHOHFWHGSRLQWRIUHIHUHQFHLQWKLVWKHVLVFRUUH
VSRQGVWRWKHVWDQGDUGK\GURJHQHOHFWURGHµ6+(¶ VSRQGVWRWKHVWDQGDUGK\GURJHQHOHFWURGHµ6+(¶
ƕ (TXLOLEULXPSRWHQWLDO ƕ (TXLOLEULXPSRWHQWLDO
x (TXLOLEULXPSRWHQWLDOµ(¶ x (TXLOLEULXPSRWHQWLDOµ(¶
7KHHTXLOLEULXPSRWHQWLDOµ(¶LVGHILQHGDVµ(¶DWHTXLOLEULXP 7KHHTXLOLEULXPSRWHQWLDOµ(¶LVGHILQHGDVµ(¶DWHTXLOLEULXP
x 6WDQGDUGSRWHQWLDOµ(¶ x 6WDQGDUGSRWHQWLDOµ(¶
7KHVWDQGDUGSRWHQWLDOµ(¶LVGHILQHGDVµ(¶DWVWDQGDUGVWDWHFRQGLWLRQV 7KHVWDQGDUGSRWHQWLDOµ(¶LVGHILQHGDVµ(¶DWVWDQGDUGVWDWHFRQGLWLRQV
,QWKHOLWHUDWXUHWKHHOHFWURGHDQGWKHHTXLOLEULXPSRWHQWLDODUHRIWHQQRWGLVWLQ ,QWKHOLWHUDWXUHWKHHOHFWURGHDQGWKHHTXLOLEULXPSRWHQWLDODUHRIWHQQRWGLVWLQ
JXLVKHGDQGUHIHUUHGWRDVKDOIFHOOSRWHQWLDO JXLVKHGDQGUHIHUUHGWRDVKDOIFHOOSRWHQWLDO
ƕ 3RWHQWLDOGLIIHUHQFH ƕ 3RWHQWLDOGLIIHUHQFH
x 3RWHQWLDOGLIIHUHQFHµ¨(¶ x 3RWHQWLDOGLIIHUHQFHµ¨(¶

 

,QVRPHOLWHUDWXUHWKHVWDQGDUGVWDWHSUHVVXUHLVGHILQHGDVDWP î1P +RZHYHULWLV
,QVRPHOLWHUDWXUHWKHVWDQGDUGVWDWHSUHVVXUHLVGHILQHGDVDWP î1P +RZHYHULWLV
SUHIHUUHGWREHFRQVLVWHQWZLWK6,XQLWVDQG>EDU@LVXVHGZKLOHWKHGLIIHUHQFHEHWZHHQ>EDU@DQG SUHIHUUHGWREHFRQVLVWHQWZLWK6,XQLWVDQG>EDU@LVXVHGZKLOHWKHGLIIHUHQFHEHWZHHQ>EDU@DQG
>DWP@LVFRQVLGHUHGQHJOLJLEOH >DWP@LVFRQVLGHUHGQHJOLJLEOH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [Y 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [Y


7HUPLQRORJ\DQG'HILQLWLRQV 7HUPLQRORJ\DQG'HILQLWLRQV

7KH HOHFWURGH SRWHQWLDO GLIIHUHQFH µ¨(¶ LV GHILQHG DV WKH GLIIHUHQFH EH 7KH HOHFWURGH SRWHQWLDO GLIIHUHQFH µ¨(¶ LV GHILQHG DV WKH GLIIHUHQFH EH
WZHHQWZRHOHFWURGHSRWHQWLDOV WZHHQWZRHOHFWURGHSRWHQWLDOV
x (TXLOLEULXPSRWHQWLDOGLIIHUHQFHµ¨(¶ x (TXLOLEULXPSRWHQWLDOGLIIHUHQFHµ¨(¶
7KHHTXLOLEULXPSRWHQWLDOGLIIHUHQFHµ¨(¶LVGHILQHGDVµ¨(¶EHWZHHQWZR 7KHHTXLOLEULXPSRWHQWLDOGLIIHUHQFHµ¨(¶LVGHILQHGDVµ¨(¶EHWZHHQWZR
HOHFWURGHSRWHQWLDOVDWHTXLOLEULXP HOHFWURGHSRWHQWLDOVDWHTXLOLEULXP
x 6WDQGDUGSRWHQWLDOGLIIHUHQFHµ¨(¶ x 6WDQGDUGSRWHQWLDOGLIIHUHQFHµ¨(¶
7KH VWDQGDUG SRWHQWLDO GLIIHUHQFH µ¨(¶ LV GHILQHG DV µ¨(¶ DW VWDQGDUG 7KH VWDQGDUG SRWHQWLDO GLIIHUHQFH µ¨(¶ LV GHILQHG DV µ¨(¶ DW VWDQGDUG
VWDWHFRQGLWLRQV VWDWHFRQGLWLRQV
7KHSRWHQWLDOGLIIHUHQFHLVLQWKHOLWHUDWXUHXVXDOO\UHIHUUHGWRDVHOHFWURPRWLYH 7KHSRWHQWLDOGLIIHUHQFHLVLQWKHOLWHUDWXUHXVXDOO\UHIHUUHGWRDVHOHFWURPRWLYH
IRUFHµ(0)¶ IRUFHµ(0)¶
ƕ &RUURVLRQSRWHQWLDOµ(FRUU¶ ƕ &RUURVLRQSRWHQWLDOµ(FRUU¶
7KH FRUURVLRQ SRWHQWLDO µ(FRUU¶ LV WKH PL[HG SRWHQWLDO HVWDEOLVKHG EHWZHHQ DOO 7KH FRUURVLRQ SRWHQWLDO µ(FRUU¶ LV WKH PL[HG SRWHQWLDO HVWDEOLVKHG EHWZHHQ DOO
DQRGLFDQGFDWKRGLFUHDFWLRQVRQDFRUURGLQJVXUIDFHRUEHWZHHQWZRRUPRUH DQRGLFDQGFDWKRGLFUHDFWLRQVRQDFRUURGLQJVXUIDFHRUEHWZHHQWZRRUPRUH
FRUURGLQJVXUIDFHVLQDQHOHFWURO\WHPHDVXUHGUHODWLYHWRDUHIHUHQFHHOHFWURGH FRUURGLQJVXUIDFHVLQDQHOHFWURO\WHPHDVXUHGUHODWLYHWRDUHIHUHQFHHOHFWURGH
,QWKHOLWHUDWXUHWKHFRUURVLRQSRWHQWLDOLVDOVRUHIHUUHGWRDVUHVWSRWHQWLDOIUHH ,QWKHOLWHUDWXUHWKHFRUURVLRQSRWHQWLDOLVDOVRUHIHUUHGWRDVUHVWSRWHQWLDOIUHH
FRUURVLRQSRWHQWLDODQG RSHQFLUFXLWSRWHQWLDO µ2&3¶  ,Q UHODWLRQWRHJSR FRUURVLRQSRWHQWLDODQG RSHQFLUFXLWSRWHQWLDO µ2&3¶  ,Q UHODWLRQWRHJSR
WHQWLDOPDSSLQJ>$670&@µ(FRUU¶LVDOVRUHIHUUHGWRDVKDOIFHOOSR WHQWLDOPDSSLQJ>$670&@µ(FRUU¶LVDOVRUHIHUUHGWRDVKDOIFHOOSR
WHQWLDOZKLFKZHUHJDUGWREHSDUWLFXODUO\PLVOHDGLQJ7KHUHIRUHWKHWHUPFRU WHQWLDOZKLFKZHUHJDUGWREHSDUWLFXODUO\PLVOHDGLQJ7KHUHIRUHWKHWHUPFRU
URVLRQSRWHQWLDOLVXVHGWKURXJKRXWWKLVWKHVLVDOVRZKHQUHIHUULQJWRSRWHQWLDOV URVLRQSRWHQWLDOLVXVHGWKURXJKRXWWKLVWKHVLVDOVRZKHQUHIHUULQJWRSRWHQWLDOV
LQFRQFUHWH LQFRQFUHWH
,W VKRXOG EH HPSKDVLVHG WKDW µ(FRUU¶ LQFOXGHV PL[HG SRWHQWLDOV HVWDEOLVKHG LQ ,W VKRXOG EH HPSKDVLVHG WKDW µ(FRUU¶ LQFOXGHV PL[HG SRWHQWLDOV HVWDEOLVKHG LQ
PDFURFHOOV RU E\ JDOYDQLF ERWK HPEHGGHG DQG H[WHUQDO HOHFWURGHV  SRODULVD PDFURFHOOV RU E\ JDOYDQLF ERWK HPEHGGHG DQG H[WHUQDO HOHFWURGHV  SRODULVD
WLRQ DV ZHOO DV FRUURVLRQ SRWHQWLDOV UHVXOWLQJ IURP SRODULVDWLRQ E\ LPSUHVVHG WLRQ DV ZHOO DV FRUURVLRQ SRWHQWLDOV UHVXOWLQJ IURP SRODULVDWLRQ E\ LPSUHVVHG
FXUUHQW FXUUHQW
‡ $IILQLW\RIUHDFWLRQV ‡ $IILQLW\RIUHDFWLRQV
7KHGHWHUPLQHG*LEEVIUHHHQHUJ\FKDQJHµ¨*¶LVVWDWHGIRUDOOFKHPLFDOUHDFWLRQV 7KHGHWHUPLQHG*LEEVIUHHHQHUJ\FKDQJHµ¨*¶LVVWDWHGIRUDOOFKHPLFDOUHDFWLRQV
WKURXJKRXW WKLV WKHVLV DQG FRUUHVSRQGLQJO\ DOO KDOIFHOO UHDFWLRQV DUH DVVLJQHG D WKURXJKRXW WKLV WKHVLV DQG FRUUHVSRQGLQJO\ DOO KDOIFHOO UHDFWLRQV DUH DVVLJQHG D
FDOFXODWHGHTXLOLEULXPSRWHQWLDOµ(¶ZKLOHWKHIROORZLQJDSSOLHV FDOFXODWHGHTXLOLEULXPSRWHQWLDOµ(¶ZKLOHWKHIROORZLQJDSSOLHV
ƕ ,IQRWVWDWHGRWKHUZLVHWKHQXPHULFDOYDOXHVRIµ¨*¶DQGµ(¶DUHVSHFLILHGIRU ƕ ,IQRWVWDWHGRWKHUZLVHWKHQXPHULFDOYDOXHVRIµ¨*¶DQGµ(¶DUHVSHFLILHGIRU
WKHVWDQGDUGVWDWHLHDVµ¨*¶DQGµ(¶ WKHVWDQGDUGVWDWHLHDVµ¨*¶DQGµ(¶
ƕ $FFRUGLQJWRWKHFRQYHQWLRQRI6WRFNKROP>,83$&@YDOXHVIRUµ(¶DUH ƕ $FFRUGLQJWRWKHFRQYHQWLRQRI6WRFNKROP>,83$&@YDOXHVIRUµ(¶DUH
DOZD\VVSHFLILHGDVUHGXFWLRQSRWHQWLDOLHWKHVLJQIRUDQR[LGDWLRQUHDFWLRQLV DOZD\VVSHFLILHGDVUHGXFWLRQSRWHQWLDOLHWKHVLJQIRUDQR[LGDWLRQUHDFWLRQLV
QRWUHYHUVHG QRWUHYHUVHG
ƕ ,IDQXPHULFDOYDOXHIRUµ(¶ZDVIRXQGDYDLODEOHLQWKHOLWHUDWXUHLWLVOLVWHGDV ƕ ,IDQXPHULFDOYDOXHIRUµ(¶ZDVIRXQGDYDLODEOHLQWKHOLWHUDWXUHLWLVOLVWHGDV
WKHVHFRQGYDOXHLQWKHFXUO\EUDFNHWV ^` ,IQRWVWDWHGRWKHUZLVHWKLVYDOXH WKHVHFRQGYDOXHLQWKHFXUO\EUDFNHWV ^` ,IQRWVWDWHGRWKHUZLVHWKLVYDOXH
ZDVWDNHQIURP>-RQHV@ ZDVWDNHQIURP>-RQHV@
‡ $QDORJLHVEHWZHHQUHDFWLRQJURXSVDQGHOHFWURFKHPLFDOTXDQWLWLHV ‡ $QDORJLHVEHWZHHQUHDFWLRQJURXSVDQGHOHFWURFKHPLFDOTXDQWLWLHV

[YL 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [YL 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 7HUPLQRORJ\DQG'HILQLWLRQV  7HUPLQRORJ\DQG'HILQLWLRQV

7KHDERYHGHILQLWLRQVDOORZWKHIROORZLQJDQDORJLHVEHWZHHQWKHUHDFWLRQJURXSV 7KHDERYHGHILQLWLRQVDOORZWKHIROORZLQJDQDORJLHVEHWZHHQWKHUHDFWLRQJURXSV
DQGHOHFWURFKHPLFDOTXDQWLWLHV7KHDIILQLW\RI DQGHOHFWURFKHPLFDOTXDQWLWLHV7KHDIILQLW\RI
ƕ 5HGR[UHDFWLRQVFDQEHH[SUHVVHGE\µ¨(¶ RUµ¨*¶  ƕ 5HGR[UHDFWLRQVFDQEHH[SUHVVHGE\µ¨(¶ RUµ¨*¶ 
ƕ $FLGEDVHUHDFWLRQVFDQEHH[SUHVVHGE\µ¨*¶ ƕ $FLGEDVHUHDFWLRQVFDQEHH[SUHVVHGE\µ¨*¶
ƕ +DOIFHOOUHDFWLRQVFDQEHH[SUHVVHGE\µ(¶ ƕ +DOIFHOOUHDFWLRQVFDQEHH[SUHVVHGE\µ(¶
‡ 6HULHVRIVWDQGDUGSRWHQWLDOV ‡ 6HULHVRIVWDQGDUGSRWHQWLDOV
7KH VHULHV RI VWDQGDUG SRWHQWLDOV LV GHILQHG DV D VHULHV RI HTXLOLEULXP SRWHQWLDOV 7KH VHULHV RI VWDQGDUG SRWHQWLDOV LV GHILQHG DV D VHULHV RI HTXLOLEULXP SRWHQWLDOV
OLVWHGDFFRUGLQJWRWKHLUPDJQLWXGHRIµ(¶,QWKHOLWHUDWXUHVXFKDOLVWLVXVXDOO\ OLVWHGDFFRUGLQJWRWKHLUPDJQLWXGHRIµ(¶,QWKHOLWHUDWXUHVXFKDOLVWLVXVXDOO\
UHIHUUHGWRDVWKHµ(0)¶VHULHV UHIHUUHGWRDVWKHµ(0)¶VHULHV
‡ &RPSDULQJHOHFWURGHSRWHQWLDOVDQGPHWDOVLQUHODWLRQWRWKHPDJQLWXGHRIµ(FRUU¶ ‡ &RPSDULQJHOHFWURGHSRWHQWLDOVDQGPHWDOVLQUHODWLRQWRWKHPDJQLWXGHRIµ(FRUU¶
%RWKHOHFWURGHSRWHQWLDOVDQGPHWDOVDUHUHIHUUHGWRDVQREOHRUDFWLYHLQUHODWLRQWR %RWKHOHFWURGHSRWHQWLDOVDQGPHWDOVDUHUHIHUUHGWRDVQREOHRUDFWLYHLQUHODWLRQWR
WKHPDJQLWXGHRIWKHLUDVVRFLDWHGµ(FRUU¶>$670*@0HWDOVDQGHOHFWURGH WKHPDJQLWXGHRIWKHLUDVVRFLDWHGµ(FRUU¶>$670*@0HWDOVDQGHOHFWURGH
SRWHQWLDOVZLWKDKLJKPDJQLWXGHRIµ(FRUU¶DUHUHIHUUHGWRDVQREOHDQGPHWDOVZLWK SRWHQWLDOVZLWKDKLJKPDJQLWXGHRIµ(FRUU¶DUHUHIHUUHGWRDVQREOHDQGPHWDOVZLWK
DORZPDJQLWXGHRIµ(FRUU¶DUHUHIHUUHGWRDVDFWLYH,QWKHOLWHUDWXUHQREOHLVRIWHQ DORZPDJQLWXGHRIµ(FRUU¶DUHUHIHUUHGWRDVDFWLYH,QWKHOLWHUDWXUHQREOHLVRIWHQ
UHIHUUHGWRDVSDVVLYHFDWKRGLFRUSURWHFWHGDQGDFWLYHLVRIWHQUHIHUUHGWRDVEDVH UHIHUUHGWRDVSDVVLYHFDWKRGLFRUSURWHFWHGDQGDFWLYHLVRIWHQUHIHUUHGWRDVEDVH
LJQREOHDQRGLFRUFRUURGLQJ,IWZRPHWDOVDUHFRPSDUHGLQUHODWLRQWRWKHLUPDJ LJQREOHDQRGLFRUFRUURGLQJ,IWZRPHWDOVDUHFRPSDUHGLQUHODWLRQWRWKHLUPDJ
QLWXGHRIµ(FRUU¶WKHWHUPVQREOHUDQGOHVVQREOHDUHXVHG,IWZRHOHFWURGHSRWHQ QLWXGHRIµ(FRUU¶WKHWHUPVQREOHUDQGOHVVQREOHDUHXVHG,IWZRHOHFWURGHSRWHQ
WLDOV DUH FRPSDUHG WKH WHUPV KLJKHU DQG ORZHU DUH XVHG 7KHVH UHIHU WR WKH IXOO WLDOV DUH FRPSDUHG WKH WHUPV KLJKHU DQG ORZHU DUH XVHG 7KHVH UHIHU WR WKH IXOO
µ6+(¶VFDOHLHIURPKLJKSRVLWLYHWRORZQHJDWLYHDQGQRWWRWKHDEVROXWH QX µ6+(¶VFDOHLHIURPKLJKSRVLWLYHWRORZQHJDWLYHDQGQRWWRWKHDEVROXWH QX
PHULFDO YDOXHRIµ(FRUU¶ PHULFDO YDOXHRIµ(FRUU¶
‡ 7\SHVRI3RXUEDL[GLDJUDPV ‡ 7\SHVRI3RXUEDL[GLDJUDPV
7KH IROORZLQJ WHUPLQRORJ\ LV XVHG WR GLVWLQJXLVK EHWZHHQ WKUHH GLVWLQFW W\SHV RI 7KH IROORZLQJ WHUPLQRORJ\ LV XVHG WR GLVWLQJXLVK EHWZHHQ WKUHH GLVWLQFW W\SHV RI
3RXUEDL[GLDJUDPVLQWURGXFHGLQWKLVWKHVLV 3RXUEDL[GLDJUDPVLQWURGXFHGLQWKLVWKHVLV
ƕ 6LQJOHHOHPHQW3RXUEDL[GLDJUDPµ6(3'¶ ƕ 6LQJOHHOHPHQW3RXUEDL[GLDJUDPµ6(3'¶
7KH WHUP VLQJOHHOHPHQW 3RXUEDL[ GLDJUDP µ6(3'¶ UHIHUV WR D 3RXUEDL[ GLD 7KH WHUP VLQJOHHOHPHQW 3RXUEDL[ GLDJUDP µ6(3'¶ UHIHUV WR D 3RXUEDL[ GLD
JUDPRIDQµ(O¶+2V\VWHPFRYHULQJRQO\RQHHOHPHQW,QWKLVWKHVLVµ6(3'V¶ JUDPRIDQµ(O¶+2V\VWHPFRYHULQJRQO\RQHHOHPHQW,QWKLVWKHVLVµ6(3'V¶
DUHQRUPDOO\OLPLWHGWRµ0H¶+2V\VWHPV DUHQRUPDOO\OLPLWHGWRµ0H¶+2V\VWHPV
ƕ 0XOWLHOHPHQW3RXUEDL[GLDJUDPµ0(3'¶ ƕ 0XOWLHOHPHQW3RXUEDL[GLDJUDPµ0(3'¶
7KH WHUP PXOWLHOHPHQW 3RXUEDL[ GLDJUDP µ0(3'¶ UHIHUV WR D 3RXUEDL[ GLD 7KH WHUP PXOWLHOHPHQW 3RXUEDL[ GLDJUDP µ0(3'¶ UHIHUV WR D 3RXUEDL[ GLD
JUDP FRYHULQJ RQH PDLQ HOHPHQW µ(O¶  LQ FRPELQDWLRQ ZLWK RWKHU HOHPHQWV JUDP FRYHULQJ RQH PDLQ HOHPHQW µ(O¶  LQ FRPELQDWLRQ ZLWK RWKHU HOHPHQWV
µ(O¶µ(O]¶  LH DQ µ(O¶µ(O¶«µ(O]¶+2 V\VWHP ZKLFK WDNHV DOO VSHFLHV µ(O¶µ(O]¶  LH DQ µ(O¶µ(O¶«µ(O]¶+2 V\VWHP ZKLFK WDNHV DOO VSHFLHV
WKDWFDQEHIRUPHGEHWZHHQWKHWZRRUPRUHHOHPHQWVLQWRDFFRXQWDVHJWKH WKDWFDQEHIRUPHGEHWZHHQWKHWZRRUPRUHHOHPHQWVLQWRDFFRXQWDVHJWKH
3RXUEDL[GLDJUDPRIWKH)H=Q+2V\VWHP 3RXUEDL[GLDJUDPRIWKH)H=Q+2V\VWHP
ƕ 6XSHULPSRVHG3RXUEDL[GLDJUDPµ6,3'¶ ƕ 6XSHULPSRVHG3RXUEDL[GLDJUDPµ6,3'¶
7KHWHUPVXSHULPSRVHG3RXUEDL[GLDJUDPµ6,3'¶PDLQO\UHIHUVWRDVXSHULP 7KHWHUPVXSHULPSRVHG3RXUEDL[GLDJUDPµ6,3'¶PDLQO\UHIHUVWRDVXSHULP
SRVLWLRQRILQGLYLGXDOµ6(3'V¶LHDQµ(O¶+2V\VWHPRQDQµ(O¶+2V\V SRVLWLRQRILQGLYLGXDOµ6(3'V¶LHDQµ(O¶+2V\VWHPRQDQµ(O¶+2V\V

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [YLL 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [YLL


7HUPLQRORJ\DQG'HILQLWLRQV 7HUPLQRORJ\DQG'HILQLWLRQV

WHPRQDQ«RQDQµ(O]¶+2V\VWHP PDLQO\VXSHUSRVLWLRQRIDµ0H¶+2RQ WHPRQDQ«RQDQµ(O]¶+2V\VWHP PDLQO\VXSHUSRVLWLRQRIDµ0H¶+2RQ


DVHFRQGµ0H¶+2V\VWHP ZLWKRXWWDNLQJLQWRDFFRXQWWKHVSHFLHVWKDWFDQ DVHFRQGµ0H¶+2V\VWHP ZLWKRXWWDNLQJLQWRDFFRXQWWKHVSHFLHVWKDWFDQ
EHIRUPHGEHWZHHQWKHWZRHOHPHQWV HJWKHVXSHUSRVLWLRQRID=Q+2V\V EHIRUPHGEHWZHHQWKHWZRHOHPHQWV HJWKHVXSHUSRVLWLRQRID=Q+2V\V
WHPRQD)H+2V\VWHP +RZHYHUµ6,3'V¶FDQDOVRUHSUHVHQWWKHVXSHUSRVL WHPRQD)H+2V\VWHP +RZHYHUµ6,3'V¶FDQDOVRUHSUHVHQWWKHVXSHUSRVL
WLRQRIWZRRUPRUHµ0(3'V¶RUDQ\ DUELWUDU\FRPELQDWLRQRIµ0(3'V¶DQG WLRQRIWZRRUPRUHµ0(3'V¶RUDQ\ DUELWUDU\FRPELQDWLRQRIµ0(3'V¶DQG
µ6(3'V¶)RULQVWDQFHWKHVXSHUSRVLWLRQRIWKHµ0(3'¶RIVHOHFWHGVWDLQOHVV µ6(3'V¶)RULQVWDQFHWKHVXSHUSRVLWLRQRIWKHµ0(3'¶RIVHOHFWHGVWDLQOHVV
VWHHODOOR\V HJWKH&U)H1L0R+2V\VWHP RQWKH)H+2V\VWHPLVDOVR VWHHODOOR\V HJWKH&U)H1L0R+2V\VWHP RQWKH)H+2V\VWHPLVDOVR
UHIHUUHGWRDVµ6,3'¶ UHIHUUHGWRDVµ6,3'¶
‡ &RXQWHUPHDVXUHV ‡ &RXQWHUPHDVXUHV
7KH WHUP FRXQWHUPHDVXUHV UHIHUV WR DOO PHDVXUHV WKDW KDYH EHHQSURSRVHG RU DUH 7KH WHUP FRXQWHUPHDVXUHV UHIHUV WR DOO PHDVXUHV WKDW KDYH EHHQSURSRVHG RU DUH
DSSOLHGWRLPSURYHWKHFRUURVLRQUHVLVWDQFHRIVWHHOLQFRQFUHWHIRUERWKQHZVWUXF DSSOLHGWRLPSURYHWKHFRUURVLRQUHVLVWDQFHRIVWHHOLQFRQFUHWHIRUERWKQHZVWUXF
WXUHV LQLWLDO FRXQWHUPHDVXUHV  DQG H[LVWLQJ VWUXFWXUHV UHSDLU RU UHKDELOLWDWLRQ RI WXUHV LQLWLDO FRXQWHUPHDVXUHV  DQG H[LVWLQJ VWUXFWXUHV UHSDLU RU UHKDELOLWDWLRQ RI
FRQFUHWHVWUXFWXUHV 7KHIROORZLQJGLVWLQFWLRQLVPDGHLQWKLVWKHVLVZLWKUHJDUGWR FRQFUHWHVWUXFWXUHV 7KHIROORZLQJGLVWLQFWLRQLVPDGHLQWKLVWKHVLVZLWKUHJDUGWR
WKHSULQFLSDODLPRIFRXQWHUPHDVXUHVIRUQHZVWUXFWXUHV WKHSULQFLSDODLPRIFRXQWHUPHDVXUHVIRUQHZVWUXFWXUHV
ƕ &RQFUHWHFRXQWHUPHDVXUHV ƕ &RQFUHWHFRXQWHUPHDVXUHV
&RQFUHWHFRXQWHUPHDVXUHVLQFOXGHPHDVXUHVWRUHGXFHWKHSHUPHDELOLW\RIWKH &RQFUHWHFRXQWHUPHDVXUHVLQFOXGHPHDVXUHVWRUHGXFHWKHSHUPHDELOLW\RIWKH
FRQFUHWH EXON FRQFUHWH VXUIDFH SURWHFWLRQ LQWHJUDO FRUURVLRQ LQKLELWRUV DQG FRQFUHWH EXON FRQFUHWH VXUIDFH SURWHFWLRQ LQWHJUDO FRUURVLRQ LQKLELWRUV DQG
PHDVXUHVWRLPSURYHWKHFRQFUHWHVWHHOLQWHUIDFH PHDVXUHVWRLPSURYHWKHFRQFUHWHVWHHOLQWHUIDFH
$SSOLFDWLRQRIWKHUPRG\QDPLFVLQUHODWLRQWRFRQFUHWHFRXQWHUPHDVXUHVJHQHU $SSOLFDWLRQRIWKHUPRG\QDPLFVLQUHODWLRQWRFRQFUHWHFRXQWHUPHDVXUHVJHQHU
DOO\ UHODWHV WR WKH WKHUPRG\QDPLF LQIOXHQFH RI RWKHU VXEVWDQFHV RQ LURQ LQ D DOO\ UHODWHV WR WKH WKHUPRG\QDPLF LQIOXHQFH RI RWKHU VXEVWDQFHV RQ LURQ LQ D
)Hµ(O¶«µ(O]¶+2V\VWHP )Hµ(O¶«µ(O]¶+2V\VWHP
ƕ 5HLQIRUFHPHQWFRXQWHUPHDVXUHV ƕ 5HLQIRUFHPHQWFRXQWHUPHDVXUHV
5HLQIRUFHPHQW FRXQWHUPHDVXUHV LQFOXGH QRQPHWDOOLF RUJDQLFFRDWHG PRUH 5HLQIRUFHPHQW FRXQWHUPHDVXUHV LQFOXGH QRQPHWDOOLF RUJDQLFFRDWHG PRUH
FRUURVLRQUHVLVWDQWFODGGHGDQGJDOYDQLVHGUHLQIRUFHPHQWDVZHOODVFDWKRGLF FRUURVLRQUHVLVWDQWFODGGHGDQGJDOYDQLVHGUHLQIRUFHPHQWDVZHOODVFDWKRGLF
SUHYHQWLRQ SUHYHQWLRQ
$SSOLFDWLRQ RI WKHUPRG\QDPLFV LQ UHODWLRQ WR UHLQIRUFHPHQW FRXQWHUPHDVXUHV $SSOLFDWLRQ RI WKHUPRG\QDPLFV LQ UHODWLRQ WR UHLQIRUFHPHQW FRXQWHUPHDVXUHV
JHQHUDOO\UHODWHVWRWKHWKHUPRG\QDPLFEHKDYLRXURIDPHWDORUDFRPELQDWLRQ JHQHUDOO\UHODWHVWRWKHWKHUPRG\QDPLFEHKDYLRXURIDPHWDORUDFRPELQDWLRQ
RIPHWDOVLQDµ0H¶µ(O¶«µ(O]¶+2V\VWHP RIPHWDOVLQDµ0H¶µ(O¶«µ(O]¶+2V\VWHP
$JHQHUDOGLVWLQFWLRQEHWZHHQFRXQWHUPHDVXUHVIRUH[LVWLQJVWUXFWXUHVLVQRWPDGH $JHQHUDOGLVWLQFWLRQEHWZHHQFRXQWHUPHDVXUHVIRUH[LVWLQJVWUXFWXUHVLVQRWPDGH
 

[YLLL 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [YLLL 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 

)RUPDWDQG6W\OH )RUPDWDQG6W\OH
6RPHJHQHUDOUHPDUNVRQWKHIRUPDWDQGVW\OHXVHGLQWKLVWKHVLVDUHJLYHQEHORZ 6RPHJHQHUDOUHPDUNVRQWKHIRUPDWDQGVW\OHXVHGLQWKLVWKHVLVDUHJLYHQEHORZ
‡ $FWLYHDQGSDVVLYHYRLFH ‡ $FWLYHDQGSDVVLYHYRLFH
7KHDFWLYHYRLFHKDVEHHQXVHGWRLQGLFDWHZKDWZHKDYHGRQHLQWKLVSURMHFWDQG 7KHDFWLYHYRLFHKDVEHHQXVHGWRLQGLFDWHZKDWZHKDYHGRQHLQWKLVSURMHFWDQG
ZKDW ZH VXJJHVW RU FRQFOXGH LQ FRQWUDVW WR ZKDW KDV EHHQ GRQH RU VXJJHVWHG E\ ZKDW ZH VXJJHVW RU FRQFOXGH LQ FRQWUDVW WR ZKDW KDV EHHQ GRQH RU VXJJHVWHG E\
RWKHUV LHLQWKHOLWHUDWXUH ,QGRLQJVR³ZH´UHIHUVWRWKHJURXSRISHUVRQVWKDW RWKHUV LHLQWKHOLWHUDWXUH ,QGRLQJVR³ZH´UHIHUVWRWKHJURXSRISHUVRQVWKDW
KDYHEHHQLQYROYHGLQWKHSURMHFWPHQWLRQHGLQWKHDFNQRZOHGJHPHQWV PDLQO\P\ KDYHEHHQLQYROYHGLQWKHSURMHFWPHQWLRQHGLQWKHDFNQRZOHGJHPHQWV PDLQO\P\
VXSHUYLVRUVDQGPH EXWLWRIWHQLQFOXGHVRWKHUSHUVRQV HYHU\ERG\ZKRDVVLVWHG VXSHUYLVRUVDQGPH EXWLWRIWHQLQFOXGHVRWKHUSHUVRQV HYHU\ERG\ZKRDVVLVWHG
PHHVSHFLDOO\LQWKHH[SHULPHQWDOSDUWRIWKLVSURMHFW  PHHVSHFLDOO\LQWKHH[SHULPHQWDOSDUWRIWKLVSURMHFW 
‡ ,WDOLFWH[WDQGTXRWHV ‡ ,WDOLFWH[WDQGTXRWHV
:KLOHVLQJOHTXRWHVDUHUHVHUYHGIRUWKHV\PEROVDQGDEEUHYLDWLRQVGHILQHGLQWKH :KLOHVLQJOHTXRWHVDUHUHVHUYHGIRUWKHV\PEROVDQGDEEUHYLDWLRQVGHILQHGLQWKH
&KDSWHU ³6\PEROV DQG $EEUHYLDWLRQV´ WKH IROORZLQJ DSSOLHV WR WKH XVH RI LWDOLF &KDSWHU ³6\PEROV DQG $EEUHYLDWLRQV´ WKH IROORZLQJ DSSOLHV WR WKH XVH RI LWDOLF
WH[WDQGGRXEOHTXRWHVWKURXJKRXWWKLVWKHVLV WH[WDQGGRXEOHTXRWHVWKURXJKRXWWKLVWKHVLV
ƕ ,WDOLFWH[WLVXVHGWRHPSKDVLVHFHUWDLQZRUGVRUVHQWHQFHV ƕ ,WDOLFWH[WLVXVHGWRHPSKDVLVHFHUWDLQZRUGVRUVHQWHQFHV
ƕ 'RXEOH TXRWHV LQGLFDWH WLWOHV SDUWLFXODU GHQRWDWLRQV RU XQFXVWRPDU\ WHUPV DV ƕ 'RXEOH TXRWHV LQGLFDWH WLWOHV SDUWLFXODU GHQRWDWLRQV RU XQFXVWRPDU\ WHUPV DV
ZHOODVLQGLFHVRIH[SHULPHQWDOVSHFLPHQV  ZHOODVLQGLFHVRIH[SHULPHQWDOVSHFLPHQV 
ƕ ,WDOLFWH[WLQGRXEOHTXRWHVLQGLFDWHVFLWDWLRQVIURPWKHOLWHUDWXUH ƕ ,WDOLFWH[WLQGRXEOHTXRWHVLQGLFDWHVFLWDWLRQVIURPWKHOLWHUDWXUH
‡ )RRWQRWHV ‡ )RRWQRWHV
)RRWQRWHVDUHXVHGIRUORQJHUFRPPHQWVRUVXSSOHPHQWDU\LQIRUPDWLRQZKLFKDUH )RRWQRWHVDUHXVHGIRUORQJHUFRPPHQWVRUVXSSOHPHQWDU\LQIRUPDWLRQZKLFKDUH
QRWVXLWDEOHZLWKLQWKHWH[W6KRUWHUFRPPHQWVDQGLQIRUPDWLRQDUHJHQHUDOO\JLYHQ QRWVXLWDEOHZLWKLQWKHWH[W6KRUWHUFRPPHQWVDQGLQIRUPDWLRQDUHJHQHUDOO\JLYHQ
LQSDUHQWKHVLV LQSDUHQWKHVLV
‡ &KDSWHUVVHFWLRQVILJXUHVWDEOHVEXOOHWVDQGHTXDWLRQV ‡ &KDSWHUVVHFWLRQVILJXUHVWDEOHVEXOOHWVDQGHTXDWLRQV
ƕ 5HIHUULQJWRFKDSWHUVVHFWLRQVILJXUHVWDEOHVDQGEXOOHWV ƕ 5HIHUULQJWRFKDSWHUVVHFWLRQVILJXUHVWDEOHVDQGEXOOHWV
7KHQLQHPDLQSDUWVRIWKLVWKHVLV FI6HFWLRQ DUHUHIHUHQFHGWRE\³&KDS 7KHQLQHPDLQSDUWVRIWKLVWKHVLV FI6HFWLRQ DUHUHIHUHQFHGWRE\³&KDS
WHU´ZKLOHWKHVXEVHFWLRQVDUHUHIHUHQFHGWRE\³6HFWLRQ´:KHQUHIHUHQFH WHU´ZKLOHWKHVXEVHFWLRQVDUHUHIHUHQFHGWRE\³6HFWLRQ´:KHQUHIHUHQFH
LVPDGHWRD³&KDSWHU´RUD³6HFWLRQ´DVZHOODVWRD³)LJXUH´D³7DEOH LVPDGHWRD³&KDSWHU´RUD³6HFWLRQ´DVZHOODVWRD³)LJXUH´D³7DEOH
´RUD³%XOOHW´ EXOOHWVDUHRQO\QXPEHUHGLQ&KDSWHU WKLVWHUPVDUHGH ´RUD³%XOOHW´ EXOOHWVDUHRQO\QXPEHUHGLQ&KDSWHU WKLVWHUPVDUHGH
QRWHGZLWKDFDSLWDOOHWWHU5HIHUHQFHWRHTXDWLRQVLHPDWKHPDWLFDOHTXDWLRQV QRWHGZLWKDFDSLWDOOHWWHU5HIHUHQFHWRHTXDWLRQVLHPDWKHPDWLFDOHTXDWLRQV
RUFKHPLFDOUHDFWLRQVLVLQGLFDWHGE\VTXDUHEUDFNHWV >@ DQGPDGHLQDGH RUFKHPLFDOUHDFWLRQVLVLQGLFDWHGE\VTXDUHEUDFNHWV >@ DQGPDGHLQDGH
VFULSWLYHPDQQHU VHH&KDSWHUµ7D'¶ ZLWKRXWFDSLWDOLVDWLRQ VFULSWLYHPDQQHU VHH&KDSWHUµ7D'¶ ZLWKRXWFDSLWDOLVDWLRQ
ƕ 1XPEHULQJRIHTXDWLRQVILJXUHVDQGWDEOHV ƕ 1XPEHULQJRIHTXDWLRQVILJXUHVDQGWDEOHV
(TXDWLRQV ILJXUHV DQG WDEOHV DUH QXPEHUHG FRQWLQXRXVO\ IRU HDFK FKDSWHU (TXDWLRQV ILJXUHV DQG WDEOHV DUH QXPEHUHG FRQWLQXRXVO\ IRU HDFK FKDSWHU
7KHFKDSWHUQXPEHUDQGWKHQXPEHURIWKHHTXDWLRQILJXUHRUWDEOHLQWKHDV 7KHFKDSWHUQXPEHUDQGWKHQXPEHURIWKHHTXDWLRQILJXUHRUWDEOHLQWKHDV
VRFLDWHGFKDSWHUDUHVHSDUDWHGE\D³GRW´&RQWUDU\WRILJXUHVDQGWDEOHVZKLFK VRFLDWHGFKDSWHUDUHVHSDUDWHGE\D³GRW´&RQWUDU\WRILJXUHVDQGWDEOHVZKLFK
 

&XUO\EUDFNHWVLQGLFDWHDOLVWRIVSHFLPHQVHJ³&^$%`´FRUUHVSRQGVWR³&$´DQG³&%´ &XUO\EUDFNHWVLQGLFDWHDOLVWRIVSHFLPHQVHJ³&^$%`´FRUUHVSRQGVWR³&$´DQG³&%´

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [L[ 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [L[


)RUPDWDQG6W\OH )RUPDWDQG6W\OH

DUHDVVLJQHGDXQLTXHQXPEHUHTXDWLRQVDUHUHSHDWHGZKHQFRQYHQLHQWDQGDUH DUHDVVLJQHGDXQLTXHQXPEHUHTXDWLRQVDUHUHSHDWHGZKHQFRQYHQLHQWDQGDUH
DVVLJQHGDQHZQXPEHU+HQFHHTXDWLRQVGRQRWKDYHDXQLTXHQXPEHU DVVLJQHGDQHZQXPEHU+HQFHHTXDWLRQVGRQRWKDYHDXQLTXHQXPEHU
‡ 5HIHUHQFHVWRWKHOLWHUDWXUHDQGOLVWRIUHIHUHQFHV ‡ 5HIHUHQFHVWRWKHOLWHUDWXUHDQGOLVWRIUHIHUHQFHV
5HIHUHQFHVLQWKHWH[WDQGWKHOLVWRIUHIHUHQFHVLQWKHHQGRIWKLVWKHVLVDUHIRUPDW 5HIHUHQFHVLQWKHWH[WDQGWKHOLVWRIUHIHUHQFHVLQWKHHQGRIWKLVWKHVLVDUHIRUPDW
WHGDFFRUGLQJWRDVOLJKWO\PRGLILHG$3$ VW\OH>$3$@ WHGDFFRUGLQJWRDVOLJKWO\PRGLILHG$3$ VW\OH>$3$@
ƕ 5HIHUHQFHVLQWKHWH[WDUHLQGLFDWHGE\VTXDUHEUDFNHWVDQGJLYHQDVIROORZV ƕ 5HIHUHQFHVLQWKHWH[WDUHLQGLFDWHGE\VTXDUHEUDFNHWVDQGJLYHQDVIROORZV
x 2QHDXWKRU>ODVWQDPHRIDXWKRU\HDU@ x 2QHDXWKRU>ODVWQDPHRIDXWKRU\HDU@
x 7ZRDXWKRUV>ODVWQDPHRIILUVWDXWKRU ODVWQDPHRIVHFRQGDXWKRU\HDU@ x 7ZRDXWKRUV>ODVWQDPHRIILUVWDXWKRU ODVWQDPHRIVHFRQGDXWKRU\HDU@
x 0RUHWKDQWZRDXWKRUV>ODVWQDPHRIILUVWDXWKRUHWDO\HDU@ x 0RUHWKDQWZRDXWKRUV>ODVWQDPHRIILUVWDXWKRUHWDO\HDU@
x $VVRFLDWLRQV HJ VWDQGDUGV >DEEUHYLDWLRQ RI DVVRFLDWLRQ VWDQGDUG QXPEHU x $VVRFLDWLRQV HJ VWDQGDUGV >DEEUHYLDWLRQ RI DVVRFLDWLRQ VWDQGDUG QXPEHU
ZLWKRXW\HDU\HDURISXEOLFDWLRQRUUHDSSURYDO@ ZLWKRXW\HDU\HDURISXEOLFDWLRQRUUHDSSURYDO@
x $VHPLFRORQLVXVHGDVDVHSDUDWRUIRUDOLVWRIUHIHUHQFHVLH>UHIHUHQFH x $VHPLFRORQLVXVHGDVDVHSDUDWRUIRUDOLVWRIUHIHUHQFHVLH>UHIHUHQFH
UHIHUHQFH@DQGWKHUHIHUHQFHVDUHOLVWHGFKURQRORJLFDOO\ UHIHUHQFH@DQGWKHUHIHUHQFHVDUHOLVWHGFKURQRORJLFDOO\
ƕ /LVWRIUHIHUHQFHV ƕ /LVWRIUHIHUHQFHV
7KHOLVWRIUHIHUHQFHVLVVRUWHGDIWHUWKHODVWQDPHRIWKHILUVWDXWKRUIROORZHG 7KHOLVWRIUHIHUHQFHVLVVRUWHGDIWHUWKHODVWQDPHRIWKHILUVWDXWKRUIROORZHG
E\WKHODVWQDPHRIRWKHUDXWKRUVWKH\HDUDQGWKHWLWOHRIWKHUHIHUHQFH7KH E\WKHODVWQDPHRIRWKHUDXWKRUVWKH\HDUDQGWKHWLWOHRIWKHUHIHUHQFH7KH
UHIHUHQFHXVHGLQWKHWH[WSUHFHGHVHDFKIXOOUHIHUHQFHLQWKHOLVWRIUHIHUHQFHV UHIHUHQFHXVHGLQWKHWH[WSUHFHGHVHDFKIXOOUHIHUHQFHLQWKHOLVWRIUHIHUHQFHV
‡ 6WDQGDUGVDQGJXLGHOLQHV ‡ 6WDQGDUGVDQGJXLGHOLQHV
$SDUWIURPWKHDFWXDOPDWHULDOVDQGPHWKRGVDSSOLHGLQWKHH[SHULPHQWDOLQYHVWL $SDUWIURPWKHDFWXDOPDWHULDOVDQGPHWKRGVDSSOLHGLQWKHH[SHULPHQWDOLQYHVWL
JDWLRQV WKDW ZHUH JHQHUDOO\ EDVHG RQ '6‚ RU &(1Á VWDQGDUGV DQG VSHFLILFDWLRQV JDWLRQV WKDW ZHUH JHQHUDOO\ EDVHG RQ '6‚ RU &(1Á VWDQGDUGV DQG VSHFLILFDWLRQV
FI 6HFWLRQ   LW LV UHIHUUHG WRERWK WKH DVVRFLDWHG (XURSHDQ LH PDLQO\ &(1 FI 6HFWLRQ   LW LV UHIHUUHG WRERWK WKH DVVRFLDWHG (XURSHDQ LH PDLQO\&(1
VWDQGDUGVDQGWKHFRUUHVSRQGLQJ86VWDQGDUGVRUJXLGHOLQHVLH$670VWDQGDUGV VWDQGDUGVDQGWKHFRUUHVSRQGLQJ86VWDQGDUGVRUJXLGHOLQHVLH$670VWDQGDUGV
RU$&,SXEOLFDWLRQV&(1VWDQGDUGVDUHJHQHUDOO\ ZLWKIHZH[FHSWLRQVZKLFKDUH RU$&,SXEOLFDWLRQV&(1VWDQGDUGVDUHJHQHUDOO\ ZLWKIHZH[FHSWLRQVZKLFKDUH
QRWRUQRW \HWDYDLODEOHLQ'HQPDUN UHIHUUHGWRDV'6(1SXEOLFDWLRQV,IDYDLO QRWRUQRW \HWDYDLODEOHLQ'HQPDUN UHIHUUHGWRDV'6(1SXEOLFDWLRQV,IDYDLO
DEOH$670DQG$&,VWDQGDUGVDQGJXLGHOLQHVDUHUHIHUUHGWRDVWKHPHWULFLVVXHV DEOH$670DQG$&,VWDQGDUGVDQGJXLGHOLQHVDUHUHIHUUHGWRDVWKHPHWULFLVVXHV
7KLVLVLQGLFDWHGE\WKHOHWWHU³0´DWWKHHQGRIWKHDVVRFLDWHGVWDQGDUGQXPEHU 7KLVLVLQGLFDWHGE\WKHOHWWHU³0´DWWKHHQGRIWKHDVVRFLDWHGVWDQGDUGQXPEHU
,I SURGXFW W\SHV ZLWK GLIIHUHQW FRXQWU\VSHFLILF LGHQWLILFDWLRQV DUH VWDWHG LQ WKLV ,I SURGXFW W\SHV ZLWK GLIIHUHQW FRXQWU\VSHFLILF LGHQWLILFDWLRQV DUH VWDWHG LQ WKLV
WKHVLV LW LV DOVR UHIHUUHG WR ERWK (XURSHDQ DQG 86 LGHQWLILFDWLRQ )RU LQVWDQFH WKHVLV LW LV DOVR UHIHUUHG WR ERWK (XURSHDQ DQG 86 LGHQWLILFDWLRQ )RU LQVWDQFH
VWDLQOHVV VWHHO JUDGHV DUH VSHFLILHG DFFRUGLQJ WR &(1 >9'(K  '6(1 VWDLQOHVV VWHHO JUDGHV DUH VSHFLILHG DFFRUGLQJ WR &(1 >9'(K  '6(1
@DVZHOODVWR>$670'6@ @DVZHOODVWR>$670'6@
 

 
$PHULFDQ3V\FKRORJLFDO$VVRFLDWLRQ $3$ :DVKLQJWRQ'&86$ $PHULFDQ3V\FKRORJLFDO$VVRFLDWLRQ $3$ :DVKLQJWRQ'&86$
‚ ‚
'DQVN6WDQGDUG '6 'DQLVK6WDQGDUG$VVRFLDWLRQ&KDUORWWHQOXQG'HQPDUN 'DQVN6WDQGDUG '6 'DQLVK6WDQGDUG$VVRFLDWLRQ&KDUORWWHQOXQG'HQPDUN
Á Á
&RPLWp(XURSpHQGH1RUPDOLVDWLRQ &(1 (XURSHDQ&RPPLWWHHIRU6WDQGDUGLVDWLRQ%UXVVHOV &RPLWp(XURSpHQGH1RUPDOLVDWLRQ &(1 (XURSHDQ&RPPLWWHHIRU6WDQGDUGLVDWLRQ%UXVVHOV
%HOJLXP %HOJLXP

[[ 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [[ 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 

7DEOHRI&RQWHQWV 7DEOHRI&RQWHQWV
3UHIDFHL 3UHIDFHL
$FNQRZOHGJPHQWVLLL $FNQRZOHGJPHQWVLLL
$EVWUDFWY $EVWUDFWY
5HVXPp LQ'DQLVK YLL 5HVXPp LQ'DQLVK YLL
6\PEROVDQG$EEUHYLDWLRQVL[ 6\PEROVDQG$EEUHYLDWLRQVL[
7HUPLQRORJ\DQG'HILQLWLRQV[LLL 7HUPLQRORJ\DQG'HILQLWLRQV[LLL
)RUPDWDQG6W\OH[L[ )RUPDWDQG6W\OH[L[
7DEOHRI&RQWHQWV[[L 7DEOHRI&RQWHQWV[[L
 ,QWURGXFWLRQ  ,QWURGXFWLRQ
 6XFFHVVRI5HLQIRUFHG&RQFUHWH6WUXFWXUHV  6XFFHVVRI5HLQIRUFHG&RQFUHWH6WUXFWXUHV
 'HWHULRUDWLRQRI5HLQIRUFHG&RQFUHWH6WUXFWXUHV  'HWHULRUDWLRQRI5HLQIRUFHG&RQFUHWH6WUXFWXUHV
 5HLQIRUFHPHQW&RUURVLRQ  5HLQIRUFHPHQW&RUURVLRQ
 $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV  $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV
 'HVLJQRI1HZ&RUURVLRQ&RXQWHUPHDVXUHV  'HVLJQRI1HZ&RUURVLRQ&RXQWHUPHDVXUHV
 2EMHFWLYHVRI7KHVLV  2EMHFWLYHVRI7KHVLV
 6FRSHRI7KHVLV  6FRSHRI7KHVLV
 2XWOLQHRI7KHVLV  2XWOLQHRI7KHVLV
 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV  2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV
 7HVW6HWXSDQG(OHFWURFKHPLFDO0HDVXUHPHQWV  7HVW6HWXSDQG(OHFWURFKHPLFDO0HDVXUHPHQWV
 0DWHULDOVDQG([SRVXUH&RQGLWLRQV  0DWHULDOVDQG([SRVXUH&RQGLWLRQV
 ,QYHVWLJDWLRQVRQ6WHHO4XDOLWLHVDQG6XUIDFH7UHDWPHQWV  ,QYHVWLJDWLRQVRQ6WHHO4XDOLWLHVDQG6XUIDFH7UHDWPHQWV
 ,QYHVWLJDWLRQVRQ6WHHO4XDOLWLHVDQG6XUIDFH0RGLILFDWLRQV  ,QYHVWLJDWLRQVRQ6WHHO4XDOLWLHVDQG6XUIDFH0RGLILFDWLRQV
 $TXHRXV0HWDOOLF&RUURVLRQ  $TXHRXV0HWDOOLF&RUURVLRQ
 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ  7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ
 5HDFWLRQ0HFKDQLVPV  5HDFWLRQ0HFKDQLVPV
 $QRGLFDQG&DWKRGLF5HDFWLRQV  $QRGLFDQG&DWKRGLF5HDFWLRQV
 *LEEV)UHH(QHUJ\  *LEEV)UHH(QHUJ\
 (TXLOLEULXP3RWHQWLDO'LIIHUHQFH  (TXLOLEULXP3RWHQWLDO'LIIHUHQFH
 5HIHUHQFH5HGXFWLRQ(TXLOLEULXPDQG6WDQGDUG3RWHQWLDO  5HIHUHQFH5HGXFWLRQ(TXLOLEULXPDQG6WDQGDUG3RWHQWLDO
 5HOHYDQW+DOI&HOO5HDFWLRQVDQG6WDQGDUG3RWHQWLDOV  5HOHYDQW+DOI&HOO5HDFWLRQVDQG6WDQGDUG3RWHQWLDOV
 5HIHUHQFH(OHFWURGHV  5HIHUHQFH(OHFWURGHV
 1HUQVW(TXDWLRQ  1HUQVW(TXDWLRQ
 3DVVLYLW\DQG%UHDNGRZQRI3DVVLYLW\  3DVVLYLW\DQG%UHDNGRZQRI3DVVLYLW\
 3RXUEDL['LDJUDP  3RXUEDL['LDJUDP
 .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ  .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ
 (OHFWULFDO'RXEOH/D\HU  (OHFWULFDO'RXEOH/D\HU
 ([FKDQJH&XUUHQW'HQVLW\  ([FKDQJH&XUUHQW'HQVLW\
 &RUURVLRQ3RWHQWLDO3RODULVDWLRQDQG2YHUSRWHQWLDO  &RUURVLRQ3RWHQWLDO3RODULVDWLRQDQG2YHUSRWHQWLDO
 7\SHVRI3RODULVDWLRQDQG2YHUSRWHQWLDO  7\SHVRI3RODULVDWLRQDQG2YHUSRWHQWLDO
 $FWLYDWLRQ3RODULVDWLRQDQG2YHUSRWHQWLDO  $FWLYDWLRQ3RODULVDWLRQDQG2YHUSRWHQWLDO
 &RQFHQWUDWLRQ3RODULVDWLRQDQG2YHUSRWHQWLDO  &RQFHQWUDWLRQ3RODULVDWLRQDQG2YHUSRWHQWLDO
 5HVLVWDQFH3RODULVDWLRQDQG2YHUSRWHQWLDO  5HVLVWDQFH3RODULVDWLRQDQG2YHUSRWHQWLDO
 $SSHDUDQFHDQG&RPELQDWLRQRI3RODULVDWLRQDQG2YHUSRWHQWLDOV  $SSHDUDQFHDQG&RPELQDWLRQRI3RODULVDWLRQDQG2YHUSRWHQWLDOV
 3RODULVDWLRQ&XUYHV  3RODULVDWLRQ&XUYHV
 7DIHO/LQHV  7DIHO/LQHV
 (YDQV'LDJUDP  (YDQV'LDJUDP
 3DVVLYLW\  3DVVLYLW\
 )RUPVRI&RUURVLRQ  )RUPVRI&RUURVLRQ
 8QLIRUPFRUURVLRQ  8QLIRUPFRUURVLRQ
 3LWWLQJFRUURVLRQ  3LWWLQJFRUURVLRQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [[L 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [[L


7DEOHRI&RQWHQWV 7DEOHRI&RQWHQWV

 *DOYDQLF&RUURVLRQ  *DOYDQLF&RUURVLRQ


 &UHYLFH&RUURVLRQ  &UHYLFH&RUURVLRQ
 ,QWHUJUDQXODU&RUURVLRQ  ,QWHUJUDQXODU&RUURVLRQ
 +\GURJHQ(PEULWWOHPHQW  +\GURJHQ(PEULWWOHPHQW
 ,QWHUUHODWLRQVEHWZHHQ7KHUPRG\QDPLFVDQG.LQHWLFV  ,QWHUUHODWLRQVEHWZHHQ7KHUPRG\QDPLFVDQG.LQHWLFV
 (OHFWURFKHPLFDO0HDVXUHPHQW7HFKQLTXHV  (OHFWURFKHPLFDO0HDVXUHPHQW7HFKQLTXHV
 &RUURVLRQ3RWHQWLDO0HDVXUHPHQWVDQG0RQLWRULQJ  &RUURVLRQ3RWHQWLDO0HDVXUHPHQWVDQG0RQLWRULQJ
 0DFURFHOO&XUUHQW0HDVXUHPHQWVDQG0RQLWRULQJ  0DFURFHOO&XUUHQW0HDVXUHPHQWVDQG0RQLWRULQJ
 3RWHQWLRVWDWLFDQG*DOYDQRVWDWLF0HDVXUHPHQWVDQG0RQLWRULQJ  3RWHQWLRVWDWLFDQG*DOYDQRVWDWLF0HDVXUHPHQWVDQG0RQLWRULQJ
 3RODULVDWLRQ&XUYH0HDVXUHPHQWV  3RODULVDWLRQ&XUYH0HDVXUHPHQWV
 /LQHDU3RODULVDWLRQ5HVLVWDQFH0HDVXUHPHQWV  /LQHDU3RODULVDWLRQ5HVLVWDQFH0HDVXUHPHQWV
 (OHFWURFKHPLFDO,PSHGDQFH6SHFWURVFRS\  (OHFWURFKHPLFDO,PSHGDQFH6SHFWURVFRS\
 &KHPLFDODQG(OHFWURFKHPLFDO6XUIDFH0RGLILFDWLRQV  &KHPLFDODQG(OHFWURFKHPLFDO6XUIDFH0RGLILFDWLRQV
 6XUIDFH&OHDQLQJ  6XUIDFH&OHDQLQJ
 'HJUHDVLQJ  'HJUHDVLQJ
 (WFKLQJ  (WFKLQJ
 (OHFWURO\WLF3ODWLQJ  (OHFWURO\WLF3ODWLQJ
 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO  3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO
 3RUWODQG&HPHQW&RQFUHWH  3RUWODQG&HPHQW&RQFUHWH
 3RUWODQG&HPHQW  3RUWODQG&HPHQW
 +\GUDWLRQ  +\GUDWLRQ
 &HPHQW3DVWH  &HPHQW3DVWH
 3RURVLW\  3RURVLW\
 3RUH6ROXWLRQ  3RUH6ROXWLRQ
 7UDQVSRUW0HFKDQLVPV  7UDQVSRUW0HFKDQLVPV
 'LIIXVLRQ  'LIIXVLRQ
 &DSLOODU\6XFWLRQ  &DSLOODU\6XFWLRQ
 0LJUDWLRQ  0LJUDWLRQ
 ,QJUHVVDQG,RQ0RELOLW\  ,QJUHVVDQG,RQ0RELOLW\
 ,QJUHVVRI2[\JHQ  ,QJUHVVRI2[\JHQ
 ,QJUHVVRI&DUERQ'LR[LGH  ,QJUHVVRI&DUERQ'LR[LGH
 ,QJUHVVRI&KORULGH,RQV  ,QJUHVVRI&KORULGH,RQV
 ,RQ0RELOLW\  ,RQ0RELOLW\
 )RUPDWLRQRI0DFURFHOOV  )RUPDWLRQRI0DFURFHOOV
 &KORULGH7KUHVKROG  &KORULGH7KUHVKROG
 ,QIOXHQFHRI7HPSHUDWXUH  ,QIOXHQFHRI7HPSHUDWXUH
 &UDFNLQJDQG(IIHFWRI&UDFNV  &UDFNLQJDQG(IIHFWRI&UDFNV
 ([WHQW$SSHDUDQFHDQG&DXVHVRI&UDFNLQJ  ([WHQW$SSHDUDQFHDQG&DXVHVRI&UDFNLQJ
 (IIHFWRI&UDFNLQJRQ,QJUHVVDQG5HLQIRUFHPHQW&RUURVLRQ  (IIHFWRI&UDFNLQJRQ,QJUHVVDQG5HLQIRUFHPHQW&RUURVLRQ
 &DUERQ6WHHO5HLQIRUFHPHQW  &DUERQ6WHHO5HLQIRUFHPHQW
 3URGXFWLRQ3URFHVV  3URGXFWLRQ3URFHVV
 0HWDOOXUJLFDODQG6XUIDFH3URSHUWLHV  0HWDOOXUJLFDODQG6XUIDFH3URSHUWLHV
 7KHRU\  7KHRU\
 ([SHULPHQWDO,QYHVWLJDWLRQV  ([SHULPHQWDO,QYHVWLJDWLRQV
 &RQFUHWH6WHHO,QWHUIDFH  &RQFUHWH6WHHO,QWHUIDFH
 $SSOLFDWLRQRI7KHUPRG\QDPLFV  $SSOLFDWLRQRI7KHUPRG\QDPLFV
 7KHUPRG\QDPLF'DWD  7KHUPRG\QDPLF'DWD
 3RXUEDL['LDJUDP  3RXUEDL['LDJUDP
 (VWDEOLVKPHQWDQG$SSOLFDWLRQRI3RXUEDL['LDJUDPV  (VWDEOLVKPHQWDQG$SSOLFDWLRQRI3RXUEDL['LDJUDPV
 $SSOLFDELOLW\RI3RXUEDL['LDJUDPIRU&RQFUHWH6WHHO6\VWHP  $SSOLFDELOLW\RI3RXUEDL['LDJUDPIRU&RQFUHWH6WHHO6\VWHP
 )H+26\VWHPDQG(OHFWURFKHPLVWU\RI&DUERQ6WHHO  )H+26\VWHPDQG(OHFWURFKHPLVWU\RI&DUERQ6WHHO
 )H+26\VWHPDQG&KHPLVWU\LQ&RQFUHWH  )H+26\VWHPDQG&KHPLVWU\LQ&RQFUHWH
 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ  7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ
 (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH  (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH
 $QRGLF&RUURVLRQ3URGXFWV  $QRGLF&RUURVLRQ3URGXFWV
 &RUURVLRQ3RWHQWLDO  &RUURVLRQ3RWHQWLDO
 )XQGDPHQWDO&RUURVLRQ0HFKDQLVP  )XQGDPHQWDO&RUURVLRQ0HFKDQLVP

[[LL 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [[LL 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 7DEOHRI&RQWHQWV  7DEOHRI&RQWHQWV

 5HDFWLRQ0HFKDQLVPV  5HDFWLRQ0HFKDQLVPV


 3DVVLYH6WDWH  3DVVLYH6WDWH
 3DVVLYLW\  3DVVLYLW\
 /RZ3RWHQWLDO&RUURVLRQ  /RZ3RWHQWLDO&RUURVLRQ
 $FWLYH&RUURVLRQ6WDWH  $FWLYH&RUURVLRQ6WDWH
 &DUERQDWLRQ,QGXFHG&RUURVLRQLQ2[\JHQ5LFK&RQFUHWH  &DUERQDWLRQ,QGXFHG&RUURVLRQLQ2[\JHQ5LFK&RQFUHWH
 &KORULGH,QGXFHG&RUURVLRQLQ2[\JHQ'HSULYHG&RQFUHWH  &KORULGH,QGXFHG&RUURVLRQLQ2[\JHQ'HSULYHG&RQFUHWH
 ,PPXQH6WDWH  ,PPXQH6WDWH
 $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV  $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV
 'XUDELOLW\DQG6HUYLFH/LIH'HVLJQ  'XUDELOLW\DQG6HUYLFH/LIH'HVLJQ
 6WDQGDUGV/LWHUDWXUHDQG2UJDQLVDWLRQV  6WDQGDUGV/LWHUDWXUHDQG2UJDQLVDWLRQV
 &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV  &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV
 &RQFUHWH&RXQWHUPHDVXUHV  &RQFUHWH&RXQWHUPHDVXUHV
 0LQHUDO$GGLWLRQVDQG&KHPLFDO$GPL[WXUHV  0LQHUDO$GGLWLRQVDQG&KHPLFDO$GPL[WXUHV
 3RVW&DVWLQJ'HQVLILFDWLRQ7HFKQLTXHV  3RVW&DVWLQJ'HQVLILFDWLRQ7HFKQLTXHV
 &RQFUHWH6XUIDFH3URWHFWLRQ  &RQFUHWH6XUIDFH3URWHFWLRQ
 ,QWHJUDO&RUURVLRQ,QKLELWRUV  ,QWHJUDO&RUURVLRQ,QKLELWRUV
 (OHFWURFKHPLFDO&RQFUHWH6WHHO,QWHUIDFH,PSURYHPHQW  (OHFWURFKHPLFDO&RQFUHWH6WHHO,QWHUIDFH,PSURYHPHQW
 5HLQIRUFHPHQW&RXQWHUPHDVXUHV  5HLQIRUFHPHQW&RXQWHUPHDVXUHV
 1RQ0HWDOOLF5HLQIRUFHPHQW  1RQ0HWDOOLF5HLQIRUFHPHQW
 2UJDQLF&RDWLQJRI5HLQIRUFLQJ6WHHO  2UJDQLF&RDWLQJRI5HLQIRUFLQJ6WHHO
 0HWDOOLF5HLQIRUFHPHQWZLWK,PSURYHG&RUURVLRQ5HVLVWDQFH  0HWDOOLF5HLQIRUFHPHQWZLWK,PSURYHG&RUURVLRQ5HVLVWDQFH
 0HWDOOLF&ODGGLQJRI5HLQIRUFHPHQW  0HWDOOLF&ODGGLQJRI5HLQIRUFHPHQW
 *DOYDQLVHG5HLQIRUFHPHQW  *DOYDQLVHG5HLQIRUFHPHQW
 &DWKRGLF3UHYHQWLRQ  &DWKRGLF3UHYHQWLRQ
 &RVWVRI&RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV  &RVWVRI&RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV
 &RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV  &RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV
 (OHFWURFKHPLFDO7HFKQLTXHV  (OHFWURFKHPLFDO7HFKQLTXHV
 &RQFUHWH3DWFK5HSDLU  &RQFUHWH3DWFK5HSDLU
 7KHUPRG\QDPLFVRI&RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV  7KHUPRG\QDPLFVRI&RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV
 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV  'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV
 'HVLJQ$VSHFWVDQG5HTXLUHPHQWV  'HVLJQ$VSHFWVDQG5HTXLUHPHQWV
 7KHRUHWLFDO'HVLJQ$SSURDFK  7KHRUHWLFDO'HVLJQ$SSURDFK
 7KHUPRG\QDPLF'HVLJQ$SSURDFK  7KHUPRG\QDPLF'HVLJQ$SSURDFK
 .LQHWLF'HVLJQ$SSURDFK  .LQHWLF'HVLJQ$SSURDFK
 3ULQFLSOHVRI,PSOHPHQWDWLRQ  3ULQFLSOHVRI,PSOHPHQWDWLRQ
 0DWHULDOV&RQFHSWV  0DWHULDOV&RQFHSWV
 =LQFDQG&RQFUHWH6WHHO6\VWHP  =LQFDQG&RQFUHWH6WHHO6\VWHP
 0DJQHVLXPDQG&RQFUHWH6WHHO6\VWHP  0DJQHVLXPDQG&RQFUHWH6WHHO6\VWHP
 ,PSOHPHQWDWLRQDQG6WUXFWXUDO$SSOLFDWLRQV  ,PSOHPHQWDWLRQDQG6WUXFWXUDO$SSOLFDWLRQV
 3UHOLPLQDU\7HVWLQJ$VSHFWVDQG5HTXLUHPHQWV  3UHOLPLQDU\7HVWLQJ$VSHFWVDQG5HTXLUHPHQWV
 (OHFWURFKHPLFDO7HFKQLTXHV  (OHFWURFKHPLFDO7HFKQLTXHV
 &RUURVLRQ3RWHQWLDO0RQLWRULQJ  &RUURVLRQ3RWHQWLDO0RQLWRULQJ
 &RUURVLRQ&XUUHQW0RQLWRULQJ  &RUURVLRQ&XUUHQW0RQLWRULQJ
 (OHFWURFKHPLFDO,PSHGDQFH6SHFWURVFRS\  (OHFWURFKHPLFDO,PSHGDQFH6SHFWURVFRS\
 3RODULVDWLRQ&XUYHV  3RODULVDWLRQ&XUYHV
 $GGLWLRQDO0HDVXUHPHQW7HFKQLTXHV  $GGLWLRQDO0HDVXUHPHQW7HFKQLTXHV
 7HVW6HWXSDQG0HDVXULQJ0HWKRGV  7HVW6HWXSDQG0HDVXULQJ0HWKRGV
 7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV  7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV
 $FWLYDWHG7LWDQLXP  $FWLYDWHG7LWDQLXP
 7HVW6SHFLPHQV  7HVW6SHFLPHQV
 0RUWDU6SHFLPHQV  0RUWDU6SHFLPHQV
 &HPHQW3DVWH6SHFLPHQV  &HPHQW3DVWH6SHFLPHQV
 ([WHUQDO&DWKRGHV  ([WHUQDO&DWKRGHV
 ([SRVXUH6HWXS  ([SRVXUH6HWXS
 0RQLWRULQJ6\VWHP  0RQLWRULQJ6\VWHP
 &OXVWHU0HDVXUHPHQWV  &OXVWHU0HDVXUHPHQWV
 6ZLWFK&DUGV  6ZLWFK&DUGV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [[LLL 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [[LLL


7DEOHRI&RQWHQWV 7DEOHRI&RQWHQWV

 'LVWULEXWLRQ7HUPLQDO%RDUGDQG'DWDORJJHU  'LVWULEXWLRQ7HUPLQDO%RDUGDQG'DWDORJJHU


 &RQWURO5RXWLQH  &RQWURO5RXWLQH
 ,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV  ,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV
 (OHFWURFKHPLFDO7HFKQLTXHV  (OHFWURFKHPLFDO7HFKQLTXHV
 &RUURVLRQ3RWHQWLDO0RQLWRULQJ  &RUURVLRQ3RWHQWLDO0RQLWRULQJ
 0DFURFHOO&XUUHQW0RQLWRULQJ  0DFURFHOO&XUUHQW0RQLWRULQJ
 (OHFWURFKHPLFDO,PSHGDQFH6SHFWURVFRS\  (OHFWURFKHPLFDO,PSHGDQFH6SHFWURVFRS\
 3RODULVDWLRQ&XUYHV  3RODULVDWLRQ&XUYHV
 $GGLWLRQDO0HDVXUHPHQW7HFKQLTXHV  $GGLWLRQDO0HDVXUHPHQW7HFKQLTXHV
 &RQFOXVLRQVDQG5HFRPPHQGDWLRQV  &RQFOXVLRQVDQG5HFRPPHQGDWLRQV
/LVWRI5HIHUHQFHV, /LVWRI5HIHUHQFHV,
/LVWRI)LJXUHV;;, /LVWRI)LJXUHV;;,
/LVWRI7DEOHV;;,; /LVWRI7DEOHV;;,;
/LVWRI&KHPLFDO6SHFLHV;;;, /LVWRI&KHPLFDO6SHFLHV;;;,
 

[[LY 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN [[LY 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 

 ,QWURGXFWLRQ  ,QWURGXFWLRQ
$WSUHVHQWWKHDSSOLFDWLRQRIFHUWDLQWKHUPRG\QDPLFSULQFLSOHVLQSURYLGLQJLQVLJKWV $WSUHVHQWWKHDSSOLFDWLRQRIFHUWDLQWKHUPRG\QDPLFSULQFLSOHVLQSURYLGLQJLQVLJKWV
LQ WKH ILHOG RI UHLQIRUFHPHQW FRUURVLRQ DSSHDUV WREH TXLWH OLPLWHG )RULQVWDQFHWKH LQ WKH ILHOG RI UHLQIRUFHPHQW FRUURVLRQ DSSHDUV WREH TXLWH OLPLWHG )RULQVWDQFHWKH
XVHRI3RXUEDL[GLDJUDPVLVUDWKHUUHVWULFWHGDQGJHQHUDOO\OLPLWHGWRH[HPSOLILFDWLRQ XVHRI3RXUEDL[GLDJUDPVLVUDWKHUUHVWULFWHGDQGJHQHUDOO\OLPLWHGWRH[HPSOLILFDWLRQ
SXUSRVHV HJ WR GHPRQVWUDWH WKH VWDELOLW\ RI LURQ LQ WKH FRQFUHWH HQYLURQPHQW E\ SXUSRVHV HJ WR GHPRQVWUDWH WKH VWDELOLW\ RI LURQ LQ WKH FRQFUHWH HQYLURQPHQW E\
PHDQV RI WKH )H+2 V\VWHP  7R RXU NQRZOHGJH 3RXUEDL[ GLDJUDPV KDYH QHLWKHU PHDQV RI WKH )H+2 V\VWHP  7R RXU NQRZOHGJH 3RXUEDL[ GLDJUDPV KDYH QHLWKHU
EHHQXVHGSURIRXQGO\WRLQYHVWLJDWHWKHHOHFWURFKHPLVWU\RIRWKHUPHWDOVRUFRPELQD EHHQXVHGSURIRXQGO\WRLQYHVWLJDWHWKHHOHFWURFKHPLVWU\RIRWKHUPHWDOVRUFRPELQD
WLRQVRIPHWDOVLQFRQFUHWHQRUWRDVVHVVWKHLQIOXHQFHRIWKHFRQFUHWHFKHPLVWU\RURI WLRQVRIPHWDOVLQFRQFUHWHQRUWRDVVHVVWKHLQIOXHQFHRIWKHFRQFUHWHFKHPLVWU\RURI
LQJUHVVLQJ VXEVWDQFHV RQ WKH WKHUPRG\QDPLFV RI VWHHO RU RWKHU PHWDOV LQ FRQFUHWH LQJUHVVLQJ VXEVWDQFHV RQ WKH WKHUPRG\QDPLFV RI VWHHO RU RWKHU PHWDOV LQ FRQFUHWH
0RUHRYHU WKH DSSOLFDWLRQ RI RWKHU WKHUPRG\QDPLFSULQFLSOHV HJWKHHVWDEOLVKPHQW 0RUHRYHU WKH DSSOLFDWLRQ RI RWKHU WKHUPRG\QDPLFSULQFLSOHV HJWKHHVWDEOLVKPHQW
RUHYDOXDWLRQRIUHDFWLRQPHFKDQLVPVEDVHGRQDVVRFLDWHG*LEEVIUHHHQHUJ\FKDQJHV RUHYDOXDWLRQRIUHDFWLRQPHFKDQLVPVEDVHGRQDVVRFLDWHG*LEEVIUHHHQHUJ\FKDQJHV
RU WKH UHTXLUHG HOHFWURGH SRWHQWLDOV  VHHPV WR EH OLPLWHG %DVHG RQ WKHVH SULQFLSOHV RU WKH UHTXLUHG HOHFWURGH SRWHQWLDOV  VHHPV WR EH OLPLWHG %DVHG RQ WKHVH SULQFLSOHV
VRPH RI WKH UHDFWLRQ PHFKDQLVPV WKDW KDYH EHHQ SRVWXODWHG LQ WKH OLWHUDWXUH IRU WKH VRPH RI WKH UHDFWLRQ PHFKDQLVPV WKDW KDYH EHHQ SRVWXODWHG LQ WKH OLWHUDWXUH IRU WKH
GHVFULSWLRQRIFRUURVLRQSURFHVVHVDSSHDUWREHLQFRQVLVWHQWRUHUURQHRXV GHVFULSWLRQRIFRUURVLRQSURFHVVHVDSSHDUWREHLQFRQVLVWHQWRUHUURQHRXV
:HWKLQNWKDWWKHUHDUHDORWRIXQH[SORLWHGSRVVLELOLWLHVLQXVLQJWKHUPRG\QDPLFSULQ :HWKLQNWKDWWKHUHDUHDORWRIXQH[SORLWHGSRVVLELOLWLHVLQXVLQJWKHUPRG\QDPLFSULQ
FLSOHVQRWRQO\IRUWKHGHVFULSWLRQRIWKHHOHFWURFKHPLVWU\RIVWHHOLQFRQFUHWHEXWDOVR FLSOHVQRWRQO\IRUWKHGHVFULSWLRQRIWKHHOHFWURFKHPLVWU\RIVWHHOLQFRQFUHWHEXWDOVR
IRUWKHHYDOXDWLRQRIH[LVWLQJDQGLQSDUWLFXODUIRUWKHGHVLJQRIQHZFRXQWHUPHDVXUHV IRUWKHHYDOXDWLRQRIH[LVWLQJDQGLQSDUWLFXODUIRUWKHGHVLJQRIQHZFRXQWHUPHDVXUHV
7KH WKHRUHWLFDO EDFNJURXQG RI WKH GHVLJQ DQG LPSOHPHQWDWLRQ RI QHZ FRXQWHUPHD 7KH WKHRUHWLFDO EDFNJURXQG RI WKH GHVLJQ DQG LPSOHPHQWDWLRQ RI QHZ FRXQWHUPHD
VXUHV DV ZHOO DV WKH HVWDEOLVKPHQW RI H[SHULPHQWDO WHVWV IRU YHULILFDWLRQ RI SRVVLEOH VXUHV DV ZHOO DV WKH HVWDEOLVKPHQW RI H[SHULPHQWDO WHVWV IRU YHULILFDWLRQ RI SRVVLEOH
SULQFLSOHVFRQVWLWXWHWKHFHQWUDODUJXPHQWVRIWKLVWKHVLV SULQFLSOHVFRQVWLWXWHWKHFHQWUDODUJXPHQWVRIWKLVWKHVLV
,QWKLV&KDSWHUWKHPRWLYDWLRQIRUWKHSURMHFWDQGDQLQWURGXFWLRQWRUHODWHGVXEMHFWV ,QWKLV&KDSWHUWKHPRWLYDWLRQIRUWKHSURMHFWDQGDQLQWURGXFWLRQWRUHODWHGVXEMHFWV
DUH JLYHQ ,W FRPSULVHV D EULHI LQWURGXFWLRQ WR UHLQIRUFHG FRQFUHWH DV D FRQVWUXFWLRQ DUH JLYHQ ,W FRPSULVHV D EULHI LQWURGXFWLRQ WR UHLQIRUFHG FRQFUHWH DV D FRQVWUXFWLRQ
PDWHULDO 6HFWLRQ WRGHWHULRUDWLRQRIUHLQIRUFHGFRQFUHWHVWUXFWXUHV 6HFWLRQ  PDWHULDO 6HFWLRQ WRGHWHULRUDWLRQRIUHLQIRUFHGFRQFUHWHVWUXFWXUHV 6HFWLRQ 
ZLWKHPSKDVLVRQUHLQIRUFHPHQWFRUURVLRQ 6HFWLRQ WRDYDLODEOHFRXQWHUPHDVXUHV ZLWKHPSKDVLVRQUHLQIRUFHPHQWFRUURVLRQ 6HFWLRQ WRDYDLODEOHFRXQWHUPHDVXUHV
6HFWLRQ DQGWRWKHSURSRVHGSULQFLSOHVIRU WKHGHVLJQRIQHZ FRXQWHUPHDVXUHV 6HFWLRQ DQGWRWKHSURSRVHGSULQFLSOHVIRU WKHGHVLJQRIQHZ FRXQWHUPHDVXUHV
6HFWLRQ  6HFWLRQ 
7KHREMHFWLYHVWKHVFRSHDQGDQRXWOLQHRIWKLVWKHVLVDUHJLYHQLQ6HFWLRQV 7KHREMHFWLYHVWKHVFRSHDQGDQRXWOLQHRIWKLVWKHVLVDUHJLYHQLQ6HFWLRQV
DQGUHVSHFWLYHO\$QRXWOLQHRIWKHH[SHULPHQWDOLQYHVWLJDWLRQVLVSURYLGHGLQ6HF DQGUHVSHFWLYHO\$QRXWOLQHRIWKHH[SHULPHQWDOLQYHVWLJDWLRQVLVSURYLGHGLQ6HF
WLRQ WLRQ

 6XFFHVVRI5HLQIRUFHG&RQFUHWH6WUXFWXUHV  6XFFHVVRI5HLQIRUFHG&RQFUHWH6WUXFWXUHV


7KURXJKRXWWKHZRUOGVWHHOUHLQIRUFHG FRQFUHWH LV WKH PRVW ZLGHO\ XVHG PDQPDGH 7KURXJKRXWWKHZRUOGVWHHOUHLQIRUFHG FRQFUHWH LV WKH PRVW ZLGHO\ XVHG PDQPDGH
FRQVWUXFWLRQ PDWHULDO $FFRUGLQJ WR DQ HVWLPDWH IURP WKH ³*OREDO &HPHQW 5HSRUW´ FRQVWUXFWLRQ PDWHULDO $FFRUGLQJ WR DQ HVWLPDWH IURP WKH ³*OREDO &HPHQW 5HSRUW´
DURXQGELOOLRQWRQVRIFHPHQWDUHSURGXFHGHYHU\\HDU>&HP1HW@:LWKWKH DURXQGELOOLRQWRQVRIFHPHQWDUHSURGXFHGHYHU\\HDU>&HP1HW@:LWKWKH
DQQXDO VWHHO SURGXFWLRQ RI DSSUR[LPDWHO\  PLOOLRQ WRQV DQG DERXW  RI WKDW DQQXDO VWHHO SURGXFWLRQ RI DSSUR[LPDWHO\  PLOOLRQ WRQV DQG DERXW  RI WKDW
TXDQWLW\ EHLQJ XVHG IRU UHLQIRUFLQJ VWHHO >,,6, @ DURXQG  ELOOLRQ WRQV RI TXDQWLW\ EHLQJ XVHG IRU UHLQIRUFLQJ VWHHO >,,6, @ DURXQG  ELOOLRQ WRQV RI
VWUXFWXUDOFRQFUHWHDUHSURGXFHGHYHU\\HDU>-RKQ@&RQVLGHULQJDZRUOGSRSXOD VWUXFWXUDOFRQFUHWHDUHSURGXFHGHYHU\\HDU>-RKQ@&RQVLGHULQJDZRUOGSRSXOD
WLRQRIELOOLRQWKLVQXPEHULVHTXLYDOHQWWRDVWDJJHULQJWRQVRIVWUXFWXUDOFRQ WLRQRIELOOLRQWKLVQXPEHULVHTXLYDOHQWWRDVWDJJHULQJWRQVRIVWUXFWXUDOFRQ
FUHWHSURGXFHGSHUFDSLWDHDFK\HDU FUHWHSURGXFHGSHUFDSLWDHDFK\HDU

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 
,QWURGXFWLRQ 'HWHULRUDWLRQRI5HLQIRUFHG&RQFUHWH6WUXFWXUHV ,QWURGXFWLRQ 'HWHULRUDWLRQRI5HLQIRUFHG&RQFUHWH6WUXFWXUHV

7KH VXFFHVV RI UHLQIRUFHG FRQFUHWH LV EDVHG RQ LWV PHFKDQLFDO VWUHQJWK YHUVDWLOLW\ 7KH VXFFHVV RI UHLQIRUFHG FRQFUHWH LV EDVHG RQ LWV PHFKDQLFDO VWUHQJWK YHUVDWLOLW\
SULFHDQGGXUDELOLW\$PRQJRWKHUVWKLVLVGXHWRWKHIROORZLQJNH\FKDUDFWHULVWLFVRI SULFHDQGGXUDELOLW\$PRQJRWKHUVWKLVLVGXHWRWKHIROORZLQJNH\FKDUDFWHULVWLFVRI
WKHFRQFUHWHVWHHOFRPSRVLWHV\VWHP WKHFRQFUHWHVWHHOFRPSRVLWHV\VWHP
‡ 5HLQIRUFHGFRQFUHWHVWUXFWXUHVFDQVXSSRUWWLPHVWKHLUZHLJKW ‡ 5HLQIRUFHGFRQFUHWHVWUXFWXUHVFDQVXSSRUWWLPHVWKHLUZHLJKW
‡ 5HLQIRUFHGFRQFUHWHFDQEHPRXOGHGWRDYDULHW\RIVKDSHVDQGILQLVKHV ‡ 5HLQIRUFHGFRQFUHWHFDQEHPRXOGHGWRDYDULHW\RIVKDSHVDQGILQLVKHV
‡ 7KHFRQVWLWXHQWPDWHULDOVDUHLQJHQHUDOLQH[SHQVLYHDQGDOPRVWXQUHVWULFWHG ‡ 7KHFRQVWLWXHQWPDWHULDOVDUHLQJHQHUDOLQH[SHQVLYHDQGDOPRVWXQUHVWULFWHG
‡ 7KHSK\VLFDOFKDUDFWHULVWLFVRIWKHFRQFUHWHVWHHOFRPSRVLWHDUHEHQHILFLDOLQSDU ‡ 7KHSK\VLFDOFKDUDFWHULVWLFVRIWKHFRQFUHWHVWHHOFRPSRVLWHDUHEHQHILFLDOLQSDU
WLFXODU WLFXODU
ƕ 7KHFHPHQWSDVWHFRQIRUPVWRWKHVXUIDFHGHWDLOVRIWKHUHLQIRUFLQJVWHHOSHU ƕ 7KHFHPHQWSDVWHFRQIRUPVWRWKHVXUIDFHGHWDLOVRIWKHUHLQIRUFLQJVWHHOSHU
PLWWLQJHIILFLHQWVWUHVVWUDQVPLVVLRQEHWZHHQWKHWZRPDWHULDOV PLWWLQJHIILFLHQWVWUHVVWUDQVPLVVLRQEHWZHHQWKHWZRPDWHULDOV
ƕ 7KH VLPLODU WKHUPDO H[SDQVLRQ FRHIILFLHQWV SURYLGH GXUDELOLW\ ZLWK UHJDUG WR ƕ 7KH VLPLODU WKHUPDO H[SDQVLRQ FRHIILFLHQWV SURYLGH GXUDELOLW\ ZLWK UHJDUG WR
WHPSHUDWXUHORDG WHPSHUDWXUHORDG
‡ %HVLGHVWKHFRQFUHWHDFWLQJDVDSK\VLFDOEDUULHUWRZDUGVDJJUHVVRUVLWVFKHPLFDO ‡ %HVLGHVWKHFRQFUHWHDFWLQJDVDSK\VLFDOEDUULHUWRZDUGVDJJUHVVRUVLWVFKHPLFDO
HQYLURQPHQWHQDEOHVSURWHFWLRQRIWKHUHLQIRUFLQJVWHHODJDLQVWFRUURVLRQ HQYLURQPHQWHQDEOHVSURWHFWLRQRIWKHUHLQIRUFLQJVWHHODJDLQVWFRUURVLRQ
+RZHYHU VHYHUDO FDVHV VKRZ WKDW UHLQIRUFHG FRQFUHWH VWUXFWXUHV GR QRW DOZD\V SHU +RZHYHU VHYHUDO FDVHV VKRZ WKDW UHLQIRUFHG FRQFUHWH VWUXFWXUHV GR QRW DOZD\V SHU
IRUPDVLQWHQGHGEXWGHWHULRUDWHSUHPDWXUHO\ IRUPDVLQWHQGHGEXWGHWHULRUDWHSUHPDWXUHO\

 'HWHULRUDWLRQRI5HLQIRUFHG&RQFUHWH6WUXFWXUHV  'HWHULRUDWLRQRI5HLQIRUFHG&RQFUHWH6WUXFWXUHV


'HWHULRUDWLRQRIFRQFUHWHVWUXFWXUHVJLYHVULVHWRFRQFHUQVDERXWVWUXFWXUDOVDIHW\LQ 'HWHULRUDWLRQRIFRQFUHWHVWUXFWXUHVJLYHVULVHWRFRQFHUQVDERXWVWUXFWXUDOVDIHW\LQ
WHJULW\DQGVHUYLFHDELOLW\DQGDERXWWKHH[SHQVHVVSHQWRQPDLQWHQDQFHDQGUHSDLU$Q WHJULW\DQGVHUYLFHDELOLW\DQGDERXWWKHH[SHQVHVVSHQWRQPDLQWHQDQFHDQGUHSDLU$Q
LQWHUHVWLQJHVWLPDWHLVWKDWQRZDGD\VWKHDQQXDOEXGJHWIRUPDLQWHQDQFHDQGUHSDLURI LQWHUHVWLQJHVWLPDWHLVWKDWQRZDGD\VWKHDQQXDOEXGJHWIRUPDLQWHQDQFHDQGUHSDLURI
H[LVWLQJ VWUXFWXUHV FRPSDUHV WR WKH RQH IRU QHZ FRQFUHWH VWUXFWXUHV >/L @ 7KH H[LVWLQJ VWUXFWXUHV FRPSDUHV WR WKH RQH IRU QHZ FRQFUHWH VWUXFWXUHV >/L @ 7KH
IROORZLQJ DSSUR[LPDWLRQV RI DQQXDO EXGJHWV IRU PDLQWHQDQFH DQG UHSDLU RI FRQFUHWH IROORZLQJ DSSUR[LPDWLRQV RI DQQXDO EXGJHWV IRU PDLQWHQDQFH DQG UHSDLU RI FRQFUHWH
VWUXFWXUHVLOOXVWUDWHWKHYDVWHFRQRPLFDOH[SHQVHV VWUXFWXUHVLOOXVWUDWHWKHYDVWHFRQRPLFDOH[SHQVHV
‡ 86!WULOOLRQ>/L@ ‡ 86!WULOOLRQ>/L@
‡ $VLD!WULOOLRQ>/L@ ‡ $VLD!WULOOLRQ>/L@
‡ (8!¼ELOOLRQ>/L@ ‡ (8!¼ELOOLRQ>/L@
‡ 'HQPDUN!'..ELOOLRQ>'%5@ ‡ 'HQPDUN!'..ELOOLRQ>'%5@
$IXUWKHULQFUHDVHLQWKHVHEXGJHWVLVH[SHFWHGGXHWRWKHIDFWWKDWDQDJLQJFRQFUHWH $IXUWKHULQFUHDVHLQWKHVHEXGJHWVLVH[SHFWHGGXHWRWKHIDFWWKDWDQDJLQJFRQFUHWH
LQIUDVWUXFWXUH IURP WKH V DQG V FRQVWUXFWLRQ ERRP LV WR EH PDLQWDLQHG DQG LQIUDVWUXFWXUH IURP WKH V DQG V FRQVWUXFWLRQ ERRP LV WR EH PDLQWDLQHG DQG
UHSDLUHGGXULQJWKHQH[WGHFDGHV UHSDLUHGGXULQJWKHQH[WGHFDGHV
<HWGHWHULRUDWLRQLVQRWRQO\DPDWWHURI HFRQRPLFDOFRQFHUQ 'HWHULRUDWLRQ RI UHLQ <HWGHWHULRUDWLRQLVQRWRQO\DPDWWHURI HFRQRPLFDOFRQFHUQ'HWHULRUDWLRQ RI UHLQ
IRUFHGFRQFUHWHVWUXFWXUHVDOVRDIIHFWVUHVRXUFHVDQGHQHUJ\FRQVXPSWLRQ>ILE@ IRUFHGFRQFUHWHVWUXFWXUHVDOVRDIIHFWVUHVRXUFHVDQGHQHUJ\FRQVXPSWLRQ>ILE@
7KHFHPHQWLQGXVWU\LVUHVSRQVLEOHIRUDERXWRIWKHJOREDODQWKURSRJHQLFJUHHQ 7KHFHPHQWLQGXVWU\LVUHVSRQVLEOHIRUDERXWRIWKHJOREDODQWKURSRJHQLFJUHHQ
KRXVH JDV HPLVVLRQ DQG IRU DERXW  RI WKH JOREDO DQWKURSRJHQLF &2 HPLVVLRQ KRXVH JDV HPLVVLRQ DQG IRU DERXW  RI WKH JOREDO DQWKURSRJHQLF &2 HPLVVLRQ
>-RKQ@7KHILQDOEXWPRVWLPSRUWDQWFRQFHUQHPHUJHVZKHQWKHVWUXFWXUDOLQ >-RKQ@7KHILQDOEXWPRVWLPSRUWDQWFRQFHUQHPHUJHVZKHQWKHVWUXFWXUDOLQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN
5HLQIRUFHPHQW&RUURVLRQ ,QWURGXFWLRQ 5HLQIRUFHPHQW&RUURVLRQ ,QWURGXFWLRQ

WHJULW\LVFRPSURPLVHGGXHWRGHWHULRUDWLRQ,QWKLVFDVHVDIHW\LVDWULVNDQGFDWDVWUR WHJULW\LVFRPSURPLVHGGXHWRGHWHULRUDWLRQ,QWKLVFDVHVDIHW\LVDWULVNDQGFDWDVWUR
SKLFIDLOXUHVPD\RFFXUZKLFKLQWKHZRUVWFDVHLQFOXGHWKHORVVRIKXPDQOLIH SKLFIDLOXUHVPD\RFFXUZKLFKLQWKHZRUVWFDVHLQFOXGHWKHORVVRIKXPDQOLIH
&RUURVLRQRIWKHUHLQIRUFLQJVWHHOKDVEHHQHVWLPDWHGWREHUHODWHGWRRIGHWHULR &RUURVLRQRIWKHUHLQIRUFLQJVWHHOKDVEHHQHVWLPDWHGWREHUHODWHGWRRIGHWHULR
UDWLRQ SUREOHPV ZLWK FRQFUHWH VWUXFWXUHV >5HQGHOO HWDO @ +RZHYHU WKHUH DUH UDWLRQ SUREOHPV ZLWK FRQFUHWH VWUXFWXUHV >5HQGHOO HWDO @ +RZHYHU WKHUH DUH
YDULRXV GHWHULRUDWLRQ PHFKDQLVPV WKDW DIIHFW WKH FRQFUHWH GLUHFWO\ HJ IUHH]HWKDZ YDULRXV GHWHULRUDWLRQ PHFKDQLVPV WKDW DIIHFW WKH FRQFUHWH GLUHFWO\ HJ IUHH]HWKDZ
GDPDJH VXOSKDWH DWWDFN RU DONDOLVLOLFD UHDFWLRQ µ$65¶ 7KH SK\VLFDO RU FKHPR GDPDJH VXOSKDWH DWWDFN RU DONDOLVLOLFD UHDFWLRQ µ$65¶ 7KH SK\VLFDO RU FKHPR
SK\VLFDO QDWXUH RI FRQFUHWH GHWHULRUDWLRQ PHFKDQLVPV RIWHQ OHDGV WR FUDFNLQJ RI WKH SK\VLFDO QDWXUH RI FRQFUHWH GHWHULRUDWLRQ PHFKDQLVPV RIWHQ OHDGV WR FUDFNLQJ RI WKH
FRQFUHWHFRYHUZKLFKLPSDLUVWKHSURWHFWLRQRIWKHVWHHODJDLQVWFRUURVLRQ7KXVGHWH FRQFUHWHFRYHUZKLFKLPSDLUVWKHSURWHFWLRQRIWKHVWHHODJDLQVWFRUURVLRQ7KXVGHWH
ULRUDWLRQRIUHLQIRUFHGFRQFUHWHVWUXFWXUHVFDQRIWHQEHDWWULEXWHGWRDFRPELQDWLRQRI ULRUDWLRQRIUHLQIRUFHGFRQFUHWHVWUXFWXUHVFDQRIWHQEHDWWULEXWHGWRDFRPELQDWLRQRI
PHFKDQLVPV PHFKDQLVPV

 5HLQIRUFHPHQW&RUURVLRQ  5HLQIRUFHPHQW&RUURVLRQ


6WHHO HPEHGGHG LQ XQFUDFNHG DQG XQFRQWDPLQDWHG XQFDUERQDWHG DQG FKORULGHIUHH  6WHHO HPEHGGHG LQ XQFUDFNHG DQG XQFRQWDPLQDWHG XQFDUERQDWHG DQG FKORULGHIUHH 
FRQFUHWHLVSURWHFWHGIURPFRUURVLRQE\WKHDONDOLQHHQYLURQPHQWSURYLGHGE\WKHSRUH FRQFUHWHLVSURWHFWHGIURPFRUURVLRQE\WKHDONDOLQHHQYLURQPHQWSURYLGHGE\WKHSRUH
VROXWLRQDQGE\WKHEXONRIWKHVXUURXQGLQJFRQFUHWHZKLFKDFWVDVDSK\VLFDOEDUULHU VROXWLRQDQGE\WKHEXONRIWKHVXUURXQGLQJFRQFUHWHZKLFKDFWVDVDSK\VLFDOEDUULHU
WRZDUGVDJJUHVVRUV:LWKDYDLODELOLW\RIR[\JHQDSURWHFWLYHR[LGHOD\HULVIRUPHGRQ WRZDUGVDJJUHVVRUV:LWKDYDLODELOLW\RIR[\JHQDSURWHFWLYHR[LGHOD\HULVIRUPHGRQ
WKHVWHHOVXUIDFHLHWKHVWHHOSDVVLYDWHV,QWKHSDVVLYHVWDWHWKHFRUURVLRQUDWHLVQHJ WKHVWHHOVXUIDFHLHWKHVWHHOSDVVLYDWHV,QWKHSDVVLYHVWDWHWKHFRUURVLRQUDWHLVQHJ
OLJLEOHDOWKRXJKWKHVWHHOLVQRWWKHUPRG\QDPLFDOO\LPPXQH7KHSDVVLYHVWDWHLVUH OLJLEOHDOWKRXJKWKHVWHHOLVQRWWKHUPRG\QDPLFDOO\LPPXQH7KHSDVVLYHVWDWHLVUH
WDLQHGH[FHSWZKHQWKHSURWHFWLYHHQYLURQPHQWRIWKHFRQFUHWHLVGLVWXUEHGHLWKHUE\ WDLQHGH[FHSWZKHQWKHSURWHFWLYHHQYLURQPHQWRIWKHFRQFUHWHLVGLVWXUEHGHLWKHUE\
QHXWUDOLVDWLRQ PDLQO\ GXH WR FDUERQDWLRQ  RU E\ WKH LQJUHVV RI GHSDVVLYDWLQJ LRQV QHXWUDOLVDWLRQ PDLQO\ GXH WR FDUERQDWLRQ  RU E\ WKH LQJUHVV RI GHSDVVLYDWLQJ LRQV
SULPDULO\FKORULGHLRQV ERWKDUHODUJHO\SRWHQWLDWHGLQFUDFNHGFRQFUHWH SULPDULO\FKORULGHLRQV ERWKDUHODUJHO\SRWHQWLDWHGLQFUDFNHGFRQFUHWH
&DUERQDWLRQLQGXFHGFRUURVLRQFDQJHQHUDOO\EHOLQNHGWRDXQLIRUPFRUURVLRQDWWDFN &DUERQDWLRQLQGXFHGFRUURVLRQFDQJHQHUDOO\EHOLQNHGWRDXQLIRUPFRUURVLRQDWWDFN
7KHFRUURVLRQSURGXFWVWKDWIRUPRQWKHVWHHOXQGHUWKHVHFRQGLWLRQVDUHPXFKODUJHU 7KHFRUURVLRQSURGXFWVWKDWIRUPRQWKHVWHHOXQGHUWKHVHFRQGLWLRQVDUHPXFKODUJHU
LQYROXPHWKDQWKHSXUHLURQFRQVXPHGLQWKHFRUURVLRQUHDFWLRQ7KHLQFUHDVHLQYRO LQYROXPHWKDQWKHSXUHLURQFRQVXPHGLQWKHFRUURVLRQUHDFWLRQ7KHLQFUHDVHLQYRO
XPH DURXQG WKH UHEDU H[HUWV GLVUXSWLYH WHQVLOH VWUHVV RQ WKH VXUURXQGLQJ FRQFUHWH ,I XPH DURXQG WKH UHEDU H[HUWV GLVUXSWLYH WHQVLOH VWUHVV RQ WKH VXUURXQGLQJ FRQFUHWH ,I
WKHVHVWUHVVHVH[FHHGWKHFRQFUHWHWHQVLOHVWUHQJWKWKHFRQFUHWHFUDFNVRUVSDOOV WKHVHVWUHVVHVH[FHHGWKHFRQFUHWHWHQVLOHVWUHQJWKWKHFRQFUHWHFUDFNVRUVSDOOV
&DUERQDWLRQDORQHFDQJHQHUDOO\EHFRQWUROOHGZLWKVWDWHRIWKHDUWFRQFUHWHPL[WXUHV &DUERQDWLRQDORQHFDQJHQHUDOO\EHFRQWUROOHGZLWKVWDWHRIWKHDUWFRQFUHWHPL[WXUHV
DQGGHVLJQRIDGHTXDWHFRYHUGHSWKZKHUHDVFRUURVLRQLQGXFHGE\LQJUHVVRIFKORULGH DQGGHVLJQRIDGHTXDWHFRYHUGHSWKZKHUHDVFRUURVLRQLQGXFHGE\LQJUHVVRIFKORULGH
LRQVUHPDLQVDPDMRUSUREOHP0RVWRIWHQFULWLFDOFKORULGHFRQWHQWVDULVHZLWKSHQHWUD LRQVUHPDLQVDPDMRUSUREOHP0RVWRIWHQFULWLFDOFKORULGHFRQWHQWVDULVHZLWKSHQHWUD
WLRQRIFKORULGHVWKURXJKWKHFRQFUHWHFRYHUZKHQWKHH[WHUQDOVXUIDFHRIWKHVWUXFWXUH WLRQRIFKORULGHVWKURXJKWKHFRQFUHWHFRYHUZKHQWKHH[WHUQDOVXUIDFHRIWKHVWUXFWXUH
LVH[SRVHGWRHJVHDVDOWVSUD\GLUHFWVHDZDWHURUGHLFLQJVDOW$OVRFKORULGHVPD\ LVH[SRVHGWRHJVHDVDOWVSUD\GLUHFWVHDZDWHURUGHLFLQJVDOW$OVRFKORULGHVPD\
EHLQFRUSRUDWHGLQWKHRULJLQDOPL[7KH\PD\EHSUHVHQWLQWKHFRQVWLWXHQWPDWHULDOV EHLQFRUSRUDWHGLQWKHRULJLQDOPL[7KH\PD\EHSUHVHQWLQWKHFRQVWLWXHQWPDWHULDOV
RU DV DFFHSWHG XQWLO WKH PLG V LQ (XURSH IRU DFFHOHUDWLRQ RI FHPHQW K\GUDWLRQ RU DV DFFHSWHG XQWLO WKH PLG V LQ (XURSH IRU DFFHOHUDWLRQ RI FHPHQW K\GUDWLRQ
GHOLEHUDWHO\DGGHGDVFDOFLXPFKORULGH &D&O 'HSHQGLQJRQWKHDYDLODELOLW\RIR[\ GHOLEHUDWHO\DGGHGDVFDOFLXPFKORULGH &D&O 'HSHQGLQJRQWKHDYDLODELOLW\RIR[\
JHQFKORULGHLQGXFHGFRUURVLRQRUWKHFRPELQDWLRQRIFKORULGHLQJUHVVDQGFDUERQD JHQFKORULGHLQGXFHGFRUURVLRQRUWKHFRPELQDWLRQRIFKORULGHLQJUHVVDQGFDUERQD
WLRQFDQOHDGWRVLPLODUGDPDJHW\SHVDVFDUERQDWLRQLQGXFHGFRUURVLRQ<HWFKORULGH WLRQFDQOHDGWRVLPLODUGDPDJHW\SHVDVFDUERQDWLRQLQGXFHGFRUURVLRQ<HWFKORULGH
LQGXFHGFRUURVLRQDORQHLVRIWHQUHODWHGWRDQRWFKOLNHVKDSHDWWDFNRIWKHUHLQIRUFH LQGXFHGFRUURVLRQDORQHLVRIWHQUHODWHGWRDQRWFKOLNHVKDSHDWWDFNRIWKHUHLQIRUFH
PHQWUHEDU7KHWHQVLRQDOVWUHVVVWUDLQUHODWLRQRIWKHUHEDUFKDQJHVLQWKHFRUURGLQJ PHQWUHEDU7KHWHQVLRQDOVWUHVVVWUDLQUHODWLRQRIWKHUHEDUFKDQJHVLQWKHFRUURGLQJ
DUHDDQGLWVYLFLQLW\ZKHQWKHQRWFKJURZVWRDVXIILFLHQWVL]H7KHQRWFKWDNHVXSDOO DUHDDQGLWVYLFLQLW\ZKHQWKHQRWFKJURZVWRDVXIILFLHQWVL]H7KHQRWFKWDNHVXSDOO
WKHGHIRUPDWLRQDVWHQVLOHVWUHVVDQGWKH\LHOGFDSDFLW\RIWKHUHEDULVUHGXFHGWR\LHOG WKHGHIRUPDWLRQDVWHQVLOHVWUHVVDQGWKH\LHOGFDSDFLW\RIWKHUHEDULVUHGXFHGWR\LHOG

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 
,QWURGXFWLRQ $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV ,QWURGXFWLRQ $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

LQJLQWKHQRWFK>)UHGHULNVHQ 3RXOVHQ@8QGHUWKHVHFLUFXPVWDQFHVWKHFRU LQJLQWKHQRWFK>)UHGHULNVHQ 3RXOVHQ@8QGHUWKHVHFLUFXPVWDQFHVWKHFRU


URGLQJUHEDUDFWVDVDEULWWOHPDWHULDODQGWKHFRQVHTXHQFHRIEULWWOHEHKDYLRXUXQGHU URGLQJUHEDUDFWVDVDEULWWOHPDWHULDODQGWKHFRQVHTXHQFHRIEULWWOHEHKDYLRXUXQGHU
VLPXOWDQHRXVH[SRVXUHWRKHDY\ORDGFDQEHGLVDVWURXV VLPXOWDQHRXVH[SRVXUHWRKHDY\ORDGFDQEHGLVDVWURXV

 $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV  $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV


6XLWDEOH GHVLJQ LH D GHQVH DQG VXIILFLHQWO\ GHHS FRQFUHWH FRYHU DQG DQ DGHTXDWH 6XLWDEOH GHVLJQ LH D GHQVH DQG VXIILFLHQWO\ GHHS FRQFUHWH FRYHU DQG DQ DGHTXDWH
FUDFN ZLGWK OLPLWDWLRQ DV ZHOO DVDSSURSULDWHH[HFXWLRQDUHRIWHQ VXIILFLHQW WR DWWDLQ FUDFN ZLGWKOLPLWDWLRQDVZHOODVDSSURSULDWHH[HFXWLRQDUHRIWHQ VXIILFLHQW WR DWWDLQ
WKHUHTXLUHGVHUYLFHOLIHIRUFRQFUHWHVWUXFWXUHV+RZHYHUFHUWDLQFRQFUHWHVWUXFWXUHV WKHUHTXLUHGVHUYLFHOLIHIRUFRQFUHWHVWUXFWXUHV+RZHYHUFHUWDLQFRQFUHWHVWUXFWXUHV
HJ VWUXFWXUHV XQGHU VHYHUH H[SRVXUH FRQGLWLRQV ZLWK VSHFLDO VHUYLFH OLIH UHTXLUH HJ VWUXFWXUHV XQGHU VHYHUH H[SRVXUH FRQGLWLRQV ZLWK VSHFLDO VHUYLFH OLIH UHTXLUH
PHQWVRUZLWKDUFKLWHFWXUDOGHVLJQVWKDWGRQRWDOORZIRUVXIILFLHQWFRYHUGHSWKVUH PHQWVRUZLWKDUFKLWHFWXUDOGHVLJQVWKDWGRQRWDOORZIRUVXIILFLHQWFRYHUGHSWKVUH
TXLUHDGGLWLRQDOFRUURVLRQFRXQWHUPHDVXUHVWRSUHYHQWSUHPDWXUHGHWHULRUDWLRQ TXLUHDGGLWLRQDOFRUURVLRQFRXQWHUPHDVXUHVWRSUHYHQWSUHPDWXUHGHWHULRUDWLRQ
9DULRXV DSSURDFKHV KDYH EHHQ SURSRVHG WR HQKDQFH WKH UHVLVWDQFH RI WKH FRQFUHWH 9DULRXV DSSURDFKHV KDYH EHHQ SURSRVHG WR HQKDQFH WKH UHVLVWDQFH RI WKH FRQFUHWH
DJDLQVWFDUERQDWLRQDQGDJDLQVWWKHSHQHWUDWLRQRIFKORULGHLRQVDVZHOODVWRLPSURYH DJDLQVWFDUERQDWLRQDQGDJDLQVWWKHSHQHWUDWLRQRIFKORULGHLRQVDVZHOODVWRLPSURYH
WKHUHVLVWDQFHRIWKHUHLQIRUFHPHQWDJDLQVWFRUURVLRQLQLWLDWLRQ )RU D JLYHQ HQYLURQ WKHUHVLVWDQFHRIWKHUHLQIRUFHPHQWDJDLQVWFRUURVLRQLQLWLDWLRQ )RU D JLYHQ HQYLURQ
PHQWWKHUHVLVWDQFHRIWKHFRQFUHWHFRYHUDJDLQVWFDUERQDWLRQDQGDJDLQVWWKHLQJUHVV PHQWWKHUHVLVWDQFHRIWKHFRQFUHWHFRYHUDJDLQVWFDUERQDWLRQDQGDJDLQVWWKHLQJUHVV
RIFKORULGHLRQVLVODUJHO\GHSHQGHQWRQWKHSK\VLFDOSURSHUWLHVRIWKHFRQFUHWH)XU RIFKORULGHLRQVLVODUJHO\GHSHQGHQWRQWKHSK\VLFDOSURSHUWLHVRIWKHFRQFUHWH)XU
WKHUPRUHFKHPLFDODWWULEXWHVRIWKHFRQFUHWHDVZHOODVWKHHOHFWURFKHPLFDOSURSHUWLHV WKHUPRUHFKHPLFDODWWULEXWHVRIWKHFRQFUHWHDVZHOODVWKHHOHFWURFKHPLFDOSURSHUWLHV
RIWKHUHLQIRUFHPHQWKDYHDVLJQLILFDQWLQIOXHQFH7KHFRUURVLRQUHVLVWDQFHRIWKHUHLQ RIWKHUHLQIRUFHPHQWKDYHDVLJQLILFDQWLQIOXHQFH7KHFRUURVLRQUHVLVWDQFHRIWKHUHLQ
IRUFHPHQWDJDLQVWFDUERQDWLRQDQGFKORULGHLQGXFHGFRUURVLRQLVJRYHUQHGE\DFRP IRUFHPHQWDJDLQVWFDUERQDWLRQDQGFKORULGHLQGXFHGFRUURVLRQLVJRYHUQHGE\DFRP
ELQDWLRQ RI DOO WKHVH IDFWRUV EXW LQ DGGLWLRQ WKH FKDUDFWHULVWLFV RI WKH FRQFUHWHVWHHO ELQDWLRQ RI DOO WKHVH IDFWRUV EXW LQ DGGLWLRQ WKH FKDUDFWHULVWLFV RI WKH FRQFUHWHVWHHO
LQWHUIDFHSOD\DPDMRUUROH LQWHUIDFHSOD\DPDMRUUROH
7KH PRVW LPSRUWDQW DYDLODEOH FRUURVLRQ FRXQWHUPHDVXUHV LQFOXGH RQ WKH RQH KDQG 7KH PRVW LPSRUWDQW DYDLODEOH FRUURVLRQ FRXQWHUPHDVXUHV LQFOXGH RQ WKH RQH KDQG
PHDVXUHV UHODWLQJ WR WKH FRQFUHWH KHQFHIRUWK FRQFUHWH FRXQWHUPHDVXUHV  VXFK DV PHDVXUHV UHODWLQJ WR WKH FRQFUHWH KHQFHIRUWK FRQFUHWH FRXQWHUPHDVXUHV  VXFK DV
PHDVXUHVWRUHGXFHWKHSHUPHDELOLW\ HJKLJKSHUIRUPDQFHFRQFUHWHµ+3&¶ FRQFUHWH PHDVXUHVWRUHGXFHWKHSHUPHDELOLW\ HJKLJKSHUIRUPDQFHFRQFUHWHµ+3&¶ FRQFUHWH
VXUIDFHSURWHFWLRQDQGLQWHJUDOFRUURVLRQLQKLELWRUVDQGRQWKHRWKHUKDQGPHDVXUHV VXUIDFHSURWHFWLRQDQGLQWHJUDOFRUURVLRQLQKLELWRUVDQGRQWKHRWKHUKDQGPHDVXUHV
UHODWLQJ WR WKH UHLQIRUFHPHQW KHQFHIRUWK UHLQIRUFHPHQW FRXQWHUPHDVXUHV  VXFK DV UHODWLQJ WR WKH UHLQIRUFHPHQW KHQFHIRUWK UHLQIRUFHPHQW FRXQWHUPHDVXUHV  VXFK DV
QRQPHWDOOLFRUJDQLFFRDWHGVWDLQOHVVVWHHOFODGGHGDQGJDOYDQLVHGUHLQIRUFHPHQWDV QRQPHWDOOLFRUJDQLFFRDWHGVWDLQOHVVVWHHOFODGGHGDQGJDOYDQLVHGUHLQIRUFHPHQWDV
ZHOODVFDWKRGLFSUHYHQWLRQ ZHOODVFDWKRGLFSUHYHQWLRQ
:LWK WKH H[FHSWLRQ RI QRQPHWDOOLF UHLQIRUFHPHQW VWDLQOHVV VWHHO UHLQIRUFHPHQW DQG :LWK WKH H[FHSWLRQ RI QRQPHWDOOLF UHLQIRUFHPHQW VWDLQOHVV VWHHO UHLQIRUFHPHQW DQG
FDWKRGLFSUHYHQWLRQVHYHUDOFDVHVRISUHPDWXUHGHWHULRUDWLRQZHUHUHSRUWHGGXULQJWKH FDWKRGLFSUHYHQWLRQVHYHUDOFDVHVRISUHPDWXUHGHWHULRUDWLRQZHUHUHSRUWHGGXULQJWKH
SDVWGHFDGHVGXHWRDQLQVXIILFLHQWSHUIRUPDQFHRIWKHDERYHPHQWLRQHGFRXQWHUPHD SDVWGHFDGHVGXHWRDQLQVXIILFLHQWSHUIRUPDQFHRIWKHDERYHPHQWLRQHGFRXQWHUPHD
VXUHVPDLQO\LQFKORULGHHQYLURQPHQWV,QSDUWLFXODUFHUWDLQW\SHVRIFRQFUHWHVXUIDFH VXUHVPDLQO\LQFKORULGHHQYLURQPHQWV,QSDUWLFXODUFHUWDLQW\SHVRIFRQFUHWHVXUIDFH
SURWHFWLRQDQGVRPHLQWHJUDOLQKLELWRUVDVZHOODVJDOYDQLVHGDQGHSR[\FRDWHGUHLQ SURWHFWLRQDQGVRPHLQWHJUDOLQKLELWRUVDVZHOODVJDOYDQLVHGDQGHSR[\FRDWHGUHLQ
IRUFHPHQWGLGQRWDOZD\VSHUIRUPXSWRWKHH[SHFWDWLRQV  IRUFHPHQWGLGQRWDOZD\VSHUIRUPXSWRWKHH[SHFWDWLRQV 
7KHDSSOLFDWLRQRIQRQPHWDOOLFUHLQIRUFHPHQWVXFKDVJODVVDUDPLGRUFDUERQILEUH 7KHDSSOLFDWLRQRIQRQPHWDOOLFUHLQIRUFHPHQWVXFKDVJODVVDUDPLGRUFDUERQILEUH
UHLQIRUFHGSRO\PHUVµ)53¶LVTXLWHOLPLWHGGXHWRHFRQRPLFDODQGSDUWLFXODUO\SUDFWL UHLQIRUFHGSRO\PHUVµ)53¶LVTXLWHOLPLWHGGXHWRHFRQRPLFDODQGSDUWLFXODUO\SUDFWL

 

1HYHUWKHOHVVWKHUHLVDQRQJRLQJGLVFXVVLRQDERXWWKHHIIHFWLYHQHVVRIWKHVHFRXQWHUPHDVXUHVDQG 1HYHUWKHOHVVWKHUHLVDQRQJRLQJGLVFXVVLRQDERXWWKHHIIHFWLYHQHVVRIWKHVHFRXQWHUPHDVXUHVDQG
DSSDUHQWO\WKH\DUHVWLOOODUJHO\SURPRWHGE\WKHUHODWHGLQGXVWU\ZKLFKGRHVQRWDOZD\VVHHPWRDF DSSDUHQWO\WKH\DUHVWLOOODUJHO\SURPRWHGE\WKHUHODWHGLQGXVWU\ZKLFKGRHVQRWDOZD\VVHHPWRDF
NQRZOHGJHWKHUHODWHGSUREOHPV FI6HFWLRQ  NQRZOHGJHWKHUHODWHGSUREOHPV FI6HFWLRQ 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN
$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV ,QWURGXFWLRQ $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV ,QWURGXFWLRQ

FDOGLVDGYDQWDJHV6RGXUDELOLW\GHVLJQRIFRQFUHWHVWUXFWXUHVIRUVHYHUHFKORULGHH[ FDOGLVDGYDQWDJHV6RGXUDELOLW\GHVLJQRIFRQFUHWHVWUXFWXUHVIRUVHYHUHFKORULGHH[
SRVXUHVHHPVWRDGDSWPRUHDQGPRUHWRXVLQJVWDLQOHVVVWHHOUHLQIRUFHPHQW7KLVGH SRVXUHVHHPVWRDGDSWPRUHDQGPRUHWRXVLQJVWDLQOHVVVWHHOUHLQIRUFHPHQW7KLVGH
YHORSPHQWIRFXVHVPDLQO\RQXVLQJDXVWHQLWLFVWDLQOHVVVWHHOJUDGHVDORQHRUVHOHFWLYH YHORSPHQWIRFXVHVPDLQO\RQXVLQJDXVWHQLWLFVWDLQOHVVVWHHOJUDGHVDORQHRUVHOHFWLYH
LQFRPELQDWLRQZLWKFDUERQVWHHOUHLQIRUFHPHQW $WSUHVHQWWKLVVROXWLRQVHHPVWREH LQFRPELQDWLRQZLWKFDUERQVWHHOUHLQIRUFHPHQW $WSUHVHQWWKLVVROXWLRQVHHPVWREH
WKH VWDWHRIWKHDUW DQG LW LV FRQVLGHUHG WR EH HIIHFWLYH DQG LQIDOOLEOH >5RVWDP  WKH VWDWHRIWKHDUW DQG LW LV FRQVLGHUHG WR EH HIIHFWLYH DQG LQIDOOLEOH >5RVWDP 
5RVWDP@+RZHYHULWFRPHVDWDSULFHWKHLQLWLDOFRVWVRIVSHFLI\LQJDXVWHQLWLF 5RVWDP@+RZHYHULWFRPHVDWDSULFHWKHLQLWLDOFRVWVRIVSHFLI\LQJDXVWHQLWLF
VWDLQOHVV UHLQIRUFHPHQW DUH QRUPDOO\  WLPHV KLJKHU WKDQ VSHFLI\LQJ FDUERQ VWHHO VWDLQOHVV UHLQIRUFHPHQW DUH QRUPDOO\  WLPHV KLJKHU WKDQ VSHFLI\LQJ FDUERQ VWHHO
>1UQEHUJHU  %HUWROLQL HWDO @ 7KH KLJKSULFH FDQQRWDOZD\V EHMXVWLILHG >1UQEHUJHU  %HUWROLQL HWDO @ 7KH KLJKSULFH FDQQRW DOZD\V EHMXVWLILHG
DQGHIIRUWVKDYHEHHQPDGHWRFXWFRVWVE\XVLQJFKHDSHUVWDLQOHVVVWHHOJUDGHV<HW DQGHIIRUWVKDYHEHHQPDGHWRFXWFRVWVE\XVLQJFKHDSHUVWDLQOHVVVWHHOJUDGHV<HW
WKH SHUIRUPDQFH ZDV JHQHUDOO\ REVHUYHG WR GHFUHDVH PRUH WKDQ WKH H[SHQVHV WKH SHUIRUPDQFH ZDV JHQHUDOO\ REVHUYHG WR GHFUHDVH PRUH WKDQ WKH H[SHQVHV
>1UQEHUJHU&KRZGKXU\@$QRWKHUZD\RIFXWWLQJFRVWVKDVEHHQWRFODG >1UQEHUJHU&KRZGKXU\@$QRWKHUZD\RIFXWWLQJFRVWVKDVEHHQWRFODG
FDUERQ VWHHO UHEDU ZLWK VWDLQOHVV VWHHO EXW WKH UHGXFWLRQV LQ FRVWV KDYH EHHQ LQVXIIL FDUERQ VWHHO UHEDU ZLWK VWDLQOHVV VWHHO EXWWKH UHGXFWLRQV LQ FRVWV KDYH EHHQ LQVXIIL
FLHQW WR PDNH FODGGLQJ DQ DWWUDFWLYH RSWLRQ >&KRZGKXU\ @ 2WKHU UHFHQW DS FLHQW WR PDNH FODGGLQJ DQ DWWUDFWLYH RSWLRQ >&KRZGKXU\ @ 2WKHU UHFHQW DS
SURDFKHVWRGHYHORSOHVVH[SHQVLYHUHLQIRUFLQJVWHHOVZLWKDQLPSURYHGFRUURVLRQUH SURDFKHVWRGHYHORSOHVVH[SHQVLYHUHLQIRUFLQJVWHHOVZLWKDQLPSURYHGFRUURVLRQUH
VLVWDQFHLQFOXGHGPLFURFRPSRVLWHVWHHOVDQGWXQJVWHQGRSHGVWHHOVIRULQVWDQFH6RPH VLVWDQFHLQFOXGHGPLFURFRPSRVLWHVWHHOVDQGWXQJVWHQGRSHGVWHHOVIRULQVWDQFH6RPH
GHYHORSPHQWVPD\EHSURPLVLQJEXWWKHUHVWLOOLVDODFNRIH[SHULHQFHDQGGRFXPHQ GHYHORSPHQWVPD\EHSURPLVLQJEXWWKHUHVWLOOLVDODFNRIH[SHULHQFHDQGGRFXPHQ
WDWLRQZLWKUHJDUGWRWKHLUGXUDELOLW\ WDWLRQZLWKUHJDUGWRWKHLUGXUDELOLW\
&DWKRGLFSUHYHQWLRQµ&3UH¶LVDUHODWLYHO\QHZLQLWLDOFRXQWHUPHDVXUHWKDWLVEDVHGRQ &DWKRGLFSUHYHQWLRQµ&3UH¶LVDUHODWLYHO\QHZLQLWLDOFRXQWHUPHDVXUHWKDWLVEDVHGRQ
VLPLODU SULQFLSOHV DV WKH PRUH IDPLOLDU FDWKRGLF SURWHFWLRQ µ&3¶ ZKLFK LV JHQHUDOO\ VLPLODU SULQFLSOHV DV WKH PRUH IDPLOLDU FDWKRGLF SURWHFWLRQ µ&3¶ ZKLFK LV JHQHUDOO\
UHODWHGWRUHSDLURUUHKDELOLWDWLRQRIH[LVWLQJVWUXFWXUHVµ&3UH¶DQGµ&3¶VKRZSURPLV UHODWHGWRUHSDLURUUHKDELOLWDWLRQRIH[LVWLQJVWUXFWXUHVµ&3UH¶DQGµ&3¶VKRZSURPLV
LQJ UHVXOWV DQG DUH LQ RXU RSLQLRQ UHDVRQDEOH DSSURDFKHV IURP D WKHUPRG\QDPLF LQJ UHVXOWV DQG DUH LQ RXU RSLQLRQ UHDVRQDEOH DSSURDFKHV IURP D WKHUPRG\QDPLF
SRLQWRIYLHZ%HVLGHVµ&3¶WKHUHDUHDQXPEHURIRWKHUPRUHRUOHVVSUHYDOHQWFRXQ SRLQWRIYLHZ%HVLGHVµ&3¶WKHUHDUHDQXPEHURIRWKHUPRUHRUOHVVSUHYDOHQWFRXQ
WHUPHDVXUHV IRU H[LVWLQJ VWUXFWXUHV HJ HOHFWURFKHPLFDO UHDONDOLVDWLRQ µ(5$¶ DQG WHUPHDVXUHV IRU H[LVWLQJ VWUXFWXUHV HJ HOHFWURFKHPLFDO UHDONDOLVDWLRQ µ(5$¶ DQG
FKORULGHUHPRYDOµ(&5¶SDWFKUHSDLUFRQFUHWHVXUIDFHSURWHFWLRQFUDFNLQMHFWLRQDQG FKORULGHUHPRYDOµ(&5¶SDWFKUHSDLUFRQFUHWHVXUIDFHSURWHFWLRQFUDFNLQMHFWLRQDQG
GLIIXVLRQLQKLELWRUV GLIIXVLRQLQKLELWRUV
µ(5$¶DQGµ(&5¶DUHEDVHGRQVLPLODUSULQFLSOHVDVµ&3UH¶DQGµ&3¶EXWWKHREMHF µ(5$¶DQGµ(&5¶DUHEDVHGRQVLPLODUSULQFLSOHVDVµ&3UH¶DQGµ&3¶EXWWKHREMHF
WLYH DQG WKH DSSOLHG FXUUHQW GHQVLWLHV GLIIHU %HVLGHV SRVVLEOH QHJDWLYH VLGH HIIHFWV WLYH DQG WKH DSSOLHG FXUUHQW GHQVLWLHV GLIIHU %HVLGHV SRVVLEOH QHJDWLYH VLGH HIIHFWV
VXFKDVK\GURJHQHPEULWWOHPHQWµ$65¶DQGORVVRIERQGVWUHQJWKµ(5$¶DQGµ(&5¶ VXFKDVK\GURJHQHPEULWWOHPHQWµ$65¶DQGORVVRIERQGVWUHQJWKµ(5$¶DQGµ(&5¶
UHTXLUHUDWKHUHODERUDWHLQVWDOODWLRQVDQGRSHUDWLRQ7KXVZHGRQRWUHJDUGWKHVHWHFK UHTXLUHUDWKHUHODERUDWHLQVWDOODWLRQVDQGRSHUDWLRQ7KXVZHGRQRWUHJDUGWKHVHWHFK
QLTXHV DV DQ DGHTXDWH VROXWLRQ IRU UHSDLU RI FRPPRQ FLYLO HQJLQHHULQJ VWUXFWXUHV QLTXHV DV DQ DGHTXDWH VROXWLRQ IRU UHSDLU RI FRPPRQ FLYLO HQJLQHHULQJ VWUXFWXUHV
7KH\ FDQ KDYH EHQHILFLDO DSSOLFDWLRQ LQ WKH SUHVHUYDWLRQ RI DUFKLWHFWXUDO ODQGPDUNV 7KH\ FDQ KDYH EHQHILFLDO DSSOLFDWLRQ LQ WKH SUHVHUYDWLRQ RI DUFKLWHFWXUDO ODQGPDUNV
KRZHYHU KRZHYHU
7KHHIIHFWLYHQHVVRIGLIIXVLRQLQKLELWRUVDSSHDUVWREHTXHVWLRQDEOH7KHVDPHKROGV 7KHHIIHFWLYHQHVVRIGLIIXVLRQLQKLELWRUVDSSHDUVWREHTXHVWLRQDEOH7KH VDPHKROGV
IRUFRQFUHWHVXUIDFHSURWHFWLRQDQGFUDFNLQMHFWLRQIRUUHSDLURIVWUXFWXUHVWKDWDUHVXE IRUFRQFUHWHVXUIDFHSURWHFWLRQDQGFUDFNLQMHFWLRQIRUUHSDLURIVWUXFWXUHVWKDWDUHVXE
VWDQWLDOO\ FRQWDPLQDWHGE\ FKORULGHRUZKHUHFRUURVLRQKDVDOUHDG\LQLWLDWHG)LQDOO\ VWDQWLDOO\ FRQWDPLQDWHGE\ FKORULGHRUZKHUHFRUURVLRQKDVDOUHDG\LQLWLDWHG)LQDOO\
WUDGLWLRQDOSDWFKUHSDLULVRIWHQOLQNHGWRWKHVRFDOOHGULQJDQRGHHIIHFWZKLFKJHQHU WUDGLWLRQDOSDWFKUHSDLULVRIWHQOLQNHGWRWKHVRFDOOHGULQJDQRGHHIIHFWZKLFKJHQHU
DOO\OHDGVWRFRUURVLRQLQLWLDWLRQLQWKHYLFLQLW\RIWKHSDWFK=LQFULFKSULPHUVRUVDFUL DOO\OHDGVWRFRUURVLRQLQLWLDWLRQLQWKHYLFLQLW\RIWKHSDWFK=LQFULFKSULPHUVRUVDFUL
ILFLDODQRGHVDUHRIWHQXVHGWRSUHYHQWWKLVHIIHFW ILFLDODQRGHVDUHRIWHQXVHGWRSUHYHQWWKLVHIIHFW

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 
,QWURGXFWLRQ 'HVLJQRI1HZ&RUURVLRQ&RXQWHUPHDVXUHV ,QWURGXFWLRQ 'HVLJQRI1HZ&RUURVLRQ&RXQWHUPHDVXUHV

 'HVLJQRI1HZ&RUURVLRQ&RXQWHUPHDVXUHV  'HVLJQRI1HZ&RUURVLRQ&RXQWHUPHDVXUHV


7KHEULHIGLVFXVVLRQLQ6HFWLRQVKRZVWKDWHYHQQRZDGD\V DIWHUFRQVWUXFWLQJZLWK 7KHEULHIGLVFXVVLRQLQ6HFWLRQVKRZVWKDWHYHQQRZDGD\V DIWHUFRQVWUXFWLQJZLWK
UHLQIRUFHGFRQFUHWHIRUPRUHWKDQDFHQWXU\DQGGHFDGHVRIH[WHQVLYHUHVHDUFKDQGGH UHLQIRUFHGFRQFUHWHIRUPRUHWKDQDFHQWXU\DQGGHFDGHVRIH[WHQVLYHUHVHDUFKDQGGH
YHORSPHQW  WKHUH VWLOO LV DQ RQJRLQJ RIWHQWLPHV FRQWURYHUVLDO GLVFXVVLRQ DERXW WKH YHORSPHQW  WKHUH VWLOO LV DQ RQJRLQJ RIWHQWLPHV FRQWURYHUVLDO GLVFXVVLRQ DERXW WKH
HIIHFWLYHQHVVRIDYDLODEOHFRXQWHUPHDVXUHVIRUERWKQHZDQGH[LVWLQJVWUXFWXUHV HIIHFWLYHQHVVRIDYDLODEOHFRXQWHUPHDVXUHVIRUERWKQHZDQGH[LVWLQJVWUXFWXUHV
,W DFWXDOO\ VHHPV WKDW EHVLGHV WKH GHYHORSPHQWV LQ µ+3&¶ DQG FRUURVLRQ LQKLELWRUV ,W DFWXDOO\ VHHPV WKDW EHVLGHV WKH GHYHORSPHQWV LQ µ+3&¶ DQG FRUURVLRQ LQKLELWRUV
UHVHDUFK DQG GXUDELOLW\ GHVLJQ PRYHV PRUH DQG PRUH WRZDUGV SURPRWLQJ UHLQIRUFH UHVHDUFK DQG GXUDELOLW\ GHVLJQ PRYHV PRUH DQG PRUH WRZDUGV SURPRWLQJ UHLQIRUFH
PHQWZLWKDQLQFUHDVHGFRUURVLRQUHVLVWDQFHDQGWKXVIXUWKHUDZD\IURPPDNLQJXVHRI PHQWZLWKDQLQFUHDVHGFRUURVLRQUHVLVWDQFHDQGWKXVIXUWKHUDZD\IURPPDNLQJXVHRI
WKHRULJLQDOEHQHILWVRIWKHFRQFUHWHVWHHOV\VWHPLHWKHSK\VLFDODQGFKHPLFDOSUR WKHRULJLQDOEHQHILWVRIWKHFRQFUHWHVWHHOV\VWHPLHWKHSK\VLFDODQGFKHPLFDOSUR
WHFWLRQWKDWWKHFRQFUHWHSURYLGHVWRHPEHGGHGFDUERQVWHHO6WDLQOHVVVWHHOKDVDIDU WHFWLRQWKDWWKHFRQFUHWHSURYLGHVWRHPEHGGHGFDUERQVWHHO6WDLQOHVVVWHHOKDVDIDU
VXSHULRU FRUURVLRQ UHVLVWDQFH WKDQ FDUERQ VWHHO DQG WKH XVH RI VWDLQOHVV VWHHO UHLQ VXSHULRU FRUURVLRQ UHVLVWDQFH WKDQ FDUERQ VWHHO DQG WKH XVH RI VWDLQOHVV VWHHO UHLQ
IRUFHPHQW VXUHO\ JUDQWV D PDMRU JDLQ LQ GXUDELOLW\ RI FRQFUHWH VWUXFWXUHV +RZHYHU IRUFHPHQW VXUHO\ JUDQWV D PDMRU JDLQ LQ GXUDELOLW\ RI FRQFUHWH VWUXFWXUHV +RZHYHU
GXHWRWKHLQFUHDVLQJZRUOGPDUNHWGHPDQGIRUVWDLQOHVVVWHHOVDQGLWVDOOR\V LQSDU GXHWRWKHLQFUHDVLQJZRUOGPDUNHWGHPDQGIRUVWDLQOHVVVWHHOVDQGLWVDOOR\V LQSDU
WLFXODUFKURPLXP ZHH[SHFWWKDWWKHSUHVHQWXSZDUGSULFHWHQGHQF\IRUVWDLQOHVVVWHHO WLFXODUFKURPLXP ZHH[SHFWWKDWWKHSUHVHQWXSZDUGSULFHWHQGHQF\IRUVWDLQOHVVVWHHO
>0(36@ZLOOSHUVLVWLQWKHIXWXUH >0(36@ZLOOSHUVLVWLQWKHIXWXUH
$VPHQWLRQHGZHWKLQNWKDWWKHUHDUHDORWRIXQH[SORLWHGSRVVLELOLWLHVLQXVLQJWKHU $VPHQWLRQHGZHWKLQNWKDWWKHUHDUHDORWRIXQH[SORLWHGSRVVLELOLWLHVLQXVLQJWKHU
PRG\QDPLF SULQFLSOHV IRU WKH GHVLJQ RI QHZ FRXQWHUPHDVXUHV <HW WKHUPRG\QDPLF PRG\QDPLF SULQFLSOHV IRU WKH GHVLJQ RI QHZ FRXQWHUPHDVXUHV <HW WKHUPRG\QDPLF
SULQFLSOHVDORQHDUHQRWVXIILFLHQWWRDVFHUWDLQZKHWKHUWKHUHLQIRUFHPHQWZLOOFRUURGH SULQFLSOHVDORQHDUHQRWVXIILFLHQWWRDVFHUWDLQZKHWKHUWKHUHLQIRUFHPHQWZLOOFRUURGH
XQGHU D JLYHQ VHW RI HQYLURQPHQWDO FRQGLWLRQV 2Q WKH RQH KDQG HYHQ WKRXJK WKH XQGHU D JLYHQ VHW RI HQYLURQPHQWDO FRQGLWLRQV 2Q WKH RQH KDQG HYHQ WKRXJK WKH
WKHUPRG\QDPLFWHQGHQF\IRUFRUURVLRQLVKLJKDFWLYHFRUURVLRQPD\QRWDSUREOHPLI WKHUPRG\QDPLFWHQGHQF\IRUFRUURVLRQLVKLJKDFWLYHFRUURVLRQPD\QRWDSUREOHPLI
WKH UDWH LV LQVLJQLILFDQWO\ ORZ 2Q WKH RWKHU KDQG WKH WKHUPRG\QDPLF WHQGHQF\ IRU WKH UDWH LV LQVLJQLILFDQWO\ ORZ 2Q WKH RWKHU KDQG WKH WKHUPRG\QDPLF WHQGHQF\ IRU
IRUPDWLRQ RI SURWHFWLYH SURGXFWV PD\ EH KLJK EXW WKH UHDFWLRQ NLQHWLFV FDQ EH WRR IRUPDWLRQ RI SURWHFWLYH SURGXFWV PD\ EH KLJK EXW WKH UHDFWLRQ NLQHWLFV FDQ EH WRR
VORZ WR HQDEOH VXIILFLHQW FRUURVLRQ SURWHFWLRQ 7KHUHIRUH NLQHWLF FRQVLGHUDWLRQV DV VORZ WR HQDEOH VXIILFLHQW FRUURVLRQ SURWHFWLRQ 7KHUHIRUH NLQHWLF FRQVLGHUDWLRQV DV
ZHOO DV FRQFOXVLYH ODERUDWRU\ LQYHVWLJDWLRQV DUH WR EH WDNHQ LQWR GXH DFFRXQW LQ WKH ZHOO DV FRQFOXVLYH ODERUDWRU\ LQYHVWLJDWLRQV DUH WR EH WDNHQ LQWR GXH DFFRXQW LQ WKH
GHVLJQRIQHZFRXQWHUPHDVXUHV0RUHRYHUJHQHUDOFRQVLGHUDWLRQVVXFKDVVWUXFWXUDO GHVLJQRIQHZFRXQWHUPHDVXUHV0RUHRYHUJHQHUDOFRQVLGHUDWLRQVVXFKDVVWUXFWXUDO
HFRQRPLFDODQGHFRORJLFDO DVSHFWVIXUWKHUOLPLWWKHDYDLODEOHRSWLRQV7KHVHFRQVLG HFRQRPLFDODQGHFRORJLFDO DVSHFWVIXUWKHUOLPLWWKHDYDLODEOHRSWLRQV7KHVHFRQVLG
HUDWLRQVHVWDEOLVKWKHEDVLVRIWKHSURSRVHGODUJHO\VLPSOLILHGPHWKRGRORJ\IRUWKHGH HUDWLRQVHVWDEOLVKWKHEDVLVRIWKHSURSRVHGODUJHO\VLPSOLILHGPHWKRGRORJ\IRUWKHGH
VLJQDQGLPSOHPHQWDWLRQRIQHZFRXQWHUPHDVXUHVVHH)LJXUH VLJQDQGLPSOHPHQWDWLRQRIQHZFRXQWHUPHDVXUHVVHH)LJXUH
*HQHUDOFRQVLGHUDWLRQV SKDVH HVWDEOLVKWKHIRXQGDWLRQRIWKHPHWKRGRORJ\LQFORVH *HQHUDOFRQVLGHUDWLRQV SKDVH HVWDEOLVKWKHIRXQGDWLRQRIWKHPHWKRGRORJ\LQFORVH
UHODWLRQDQGFRQVWDQWLQWHUFKDQJHZLWKWKHUPRG\QDPLFFRQVLGHUDWLRQVNLQHWLFFRQVLG UHODWLRQDQGFRQVWDQWLQWHUFKDQJHZLWKWKHUPRG\QDPLFFRQVLGHUDWLRQVNLQHWLFFRQVLG
HUDWLRQV DQG WKH DVVRFLDWHG SURGXFWLRQ DQG LPSOHPHQWDWLRQ RI WKH QHZ FRXQWHUPHD HUDWLRQV DQG WKH DVVRFLDWHG SURGXFWLRQ DQG LPSOHPHQWDWLRQ RI WKH QHZ FRXQWHUPHD
VXUH SKDVH   3UHOLPLQDU\ ODERUDWRU\ LQYHVWLJDWLRQV SKDVH   LH WHVWLQJ EDVHG RQ VXUH SKDVH   3UHOLPLQDU\ ODERUDWRU\ LQYHVWLJDWLRQV SKDVH   LH WHVWLQJ EDVHG RQ
VPDOO VFDOH VSHFLPHQV XQGHU DFFHOHUDWHG FRQGLWLRQV LV WKH QH[W SKDVH LQ WKH GHVLJQ VPDOO VFDOH VSHFLPHQV XQGHU DFFHOHUDWHG FRQGLWLRQV LV WKH QH[W SKDVH LQ WKH GHVLJQ
KLHUDUFK\ZKLFKLVDOVRFORVHO\OLQNHGWRSKDVHDQGLQFRQVWDQWLQWHUFKDQJHZLWKLW KLHUDUFK\ZKLFKLVDOVRFORVHO\OLQNHGWRSKDVHDQGLQFRQVWDQWLQWHUFKDQJHZLWKLW

 
 
 (FRORJLFDODVSHFWVPLJKWVHHPSHFXOLDURQWKHILUVWJODQFHEXWFRQVLGHULQJHJWKHWR[LFLW\RIFKURP  (FRORJLFDODVSHFWVPLJKWVHHPSHFXOLDURQWKHILUVWJODQFHEXWFRQVLGHULQJHJWKHWR[LFLW\RIFKURP
DWHVDQGQLWULWHVZHUHJDUGWKHPDVUHOHYDQW DWHVDQGQLWULWHVZHUHJDUGWKHPDVUHOHYDQW

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN
'HVLJQRI1HZ&RUURVLRQ&RXQWHUPHDVXUHV ,QWURGXFWLRQ 'HVLJQRI1HZ&RUURVLRQ&RXQWHUPHDVXUHV ,QWURGXFWLRQ

 
)LJXUH 6LPSOLILHGIORZFKDUWIRUWKHGHVLJQDQGLPSOHPHQWDWLRQRIQHZFRXQ )LJXUH 6LPSOLILHGIORZFKDUWIRUWKHGHVLJQDQGLPSOHPHQWDWLRQRIQHZFRXQ
WHUPHDVXUHV7KHJUH\VKDGHGDUHDVLQGLFDWHWKHGHVLJQSKDVHVRIFRQ WHUPHDVXUHV7KHJUH\VKDGHGDUHDVLQGLFDWHWKHGHVLJQSKDVHVRIFRQ
FHUQLQWKLVWKHVLVLHSKDVHVWR FHUQLQWKLVWKHVLVLHSKDVHVWR
,I DIILUPDWLYH UHVXOWV DUH REWDLQHG IURP SUHOLPLQDU\ WHVWLQJ FRPSUHKHQVLYH ILQDO LQ ,I DIILUPDWLYH UHVXOWV DUH REWDLQHG IURP SUHOLPLQDU\ WHVWLQJ FRPSUHKHQVLYH ILQDO LQ
YHVWLJDWLRQV SKDVH DUHWREHSHUIRUPHGRQHJODUJHVFDOHVSHFLPHQVEDVHGRQWKH YHVWLJDWLRQV SKDVH DUHWREHSHUIRUPHGRQHJODUJHVFDOHVSHFLPHQVEDVHGRQWKH
DFWXDOPDWHULDOVXQGHUUHDOLVWLFH[SRVXUHFRQGLWLRQV$QREYLRXVSUREOHPFRQQHFWHGWR DFWXDOPDWHULDOVXQGHUUHDOLVWLFH[SRVXUHFRQGLWLRQV$QREYLRXVSUREOHPFRQQHFWHGWR
VXFKILQDOLQYHVWLJDWLRQVLVWKDWPHDVXUHVDUHWREHWDNHQWRHQDEOHSUHGLFWLRQVIRUGH VXFKILQDOLQYHVWLJDWLRQVLVWKDWPHDVXUHVDUHWREHWDNHQWRHQDEOHSUHGLFWLRQVIRUGH
VLJQ VHUYLFH OLYHV RI  \HDUV RU PRUH ZLWKLQ UHDVRQDEOH WHVW GXUDWLRQ HJ D IHZ VLJQ VHUYLFH OLYHV RI  \HDUV RU PRUH ZLWKLQ UHDVRQDEOH WHVW GXUDWLRQ HJ D IHZ
PRQWKV RU \HDUV ,I WKH ILQDO LQYHVWLJDWLRQV LQGLFDWH SUREOHPV ZKLFK KDYH QRW EHHQ PRQWKV RU \HDUV ,I WKH ILQDO LQYHVWLJDWLRQV LQGLFDWH SUREOHPV ZKLFK KDYH QRW EHHQ
LGHQWLILHG LQ WKH SUHOLPLQDU\ LQYHVWLJDWLRQV WKH JHQHUDO FRQVLGHUDWLRQV DUH WR EH UH LGHQWLILHG LQ WKH SUHOLPLQDU\ LQYHVWLJDWLRQV WKH JHQHUDO FRQVLGHUDWLRQV DUH WR EH UH
HYDOXDWHG7KLVLVLOOXVWUDWHGE\WKHVROLGEDFNZDUGVRULHQWDWHGDUURZRQWKHOHIWKDQG HYDOXDWHG7KLVLVLOOXVWUDWHGE\WKHVROLGEDFNZDUGVRULHQWDWHGDUURZRQWKHOHIWKDQG
VLGH,IWKHILQDOLQYHVWLJDWLRQVFRQILUPWKHHIIHFWLYHQHVVRIWKHQHZFRXQWHUPHDVXUH VLGH,IWKHILQDOLQYHVWLJDWLRQVFRQILUPWKHHIIHFWLYHQHVVRIWKHQHZFRXQWHUPHDVXUH
VHUYLFHOLIHDVVHVVPHQWDQGGHVLJQ SKDVH FDQEHXQGHUWDNHQEDVHGRQWKHFRUURVLRQ VHUYLFHOLIHDVVHVVPHQWDQGGHVLJQ SKDVH FDQEHXQGHUWDNHQEDVHGRQWKHFRUURVLRQ
SURWHFWLRQFKDUDFWHULVWLFVGHWHUPLQHGE\WKHILQDOWHVWLQJDQGZLWKWKHGHVLJQVHUYLFH SURWHFWLRQFKDUDFWHULVWLFVGHWHUPLQHGE\WKHILQDOWHVWLQJDQGZLWKWKHGHVLJQVHUYLFH
OLIHDQGDFWXDOH[SRVXUHFRQGLWLRQVDVLQSXWSDUDPHWHUV6HUYLFHOLIHGHVLJQLVXQGHU OLIHDQGDFWXDOH[SRVXUHFRQGLWLRQVDVLQSXWSDUDPHWHUV6HUYLFHOLIHGHVLJQLVXQGHU
WDNHQLQFORVHFRQQHFWLRQDQGFRQVWDQWLQWHUFKDQJHZLWKVWUXFWXUDOGHVLJQ SKDVH WR WDNHQLQFORVHFRQQHFWLRQDQGFRQVWDQWLQWHUFKDQJHZLWKVWUXFWXUDOGHVLJQ SKDVH WR
GHWHUPLQHWKHILQDOGHWDLOLQJRIWKHVWUXFWXUH RUUHSDLUVWUDWHJ\  GHWHUPLQHWKHILQDOGHWDLOLQJRIWKHVWUXFWXUH RUUHSDLUVWUDWHJ\ 
&RQWLQXRXVPRQLWRULQJ SKDVH GXULQJWKHVHUYLFHOLIHSURYLGHVIHHGEDFNRQWKHHI &RQWLQXRXVPRQLWRULQJ SKDVH GXULQJWKHVHUYLFHOLIHSURYLGHVIHHGEDFNRQWKHHI
IHFWLYHQHVVRIWKHLPSOHPHQWHGFRXQWHUPHDVXUH7DNLQJLQWRDFFRXQWWKHVDIHW\PDU IHFWLYHQHVVRIWKHLPSOHPHQWHGFRXQWHUPHDVXUH7DNLQJLQWRDFFRXQWWKHVDIHW\PDU
JLQV DSSOLHG LQ GXUDELOLW\ DQG VWUXFWXUDO GHVLJQ DQ XSGDWH SKDVH   WRZDUGV DQ H[ JLQV DSSOLHG LQ GXUDELOLW\ DQG VWUXFWXUDO GHVLJQ DQ XSGDWH SKDVH   WRZDUGV DQ H[
WHQGHGVHUYLFHOLIHLVSRVVLEOHLQWKHGHVLUDEOHFDVHRIWKHFRXQWHUPHDVXUHSHUIRUPLQJ WHQGHGVHUYLFHOLIHLVSRVVLEOHLQWKHGHVLUDEOHFDVHRIWKHFRXQWHUPHDVXUHSHUIRUPLQJ
HIIHFWLYHO\ EDVHG RQ WKH LQIRUPDWLRQ REWDLQHG IURP PRQLWRULQJ ,Q WKH XQGHVLUDEOH HIIHFWLYHO\ EDVHG RQ WKH LQIRUPDWLRQ REWDLQHG IURP PRQLWRULQJ ,Q WKH XQGHVLUDEOH
FDVH RI SUHPDWXUH GHWHULRUDWLRQ LQGLFDWHG E\ WKH PRQLWRULQJ RSWLRQV RI UHSDLU RU FDVH RI SUHPDWXUH GHWHULRUDWLRQ LQGLFDWHG E\ WKH PRQLWRULQJ RSWLRQV RI UHSDLU RU
GHPROLWLRQ SKDVH   DUH WREH FRQVLGHUHG DQG WKH GHVLJQ DQG LPSOHPHQWDWLRQ RI WKH GHPROLWLRQ SKDVH   DUH WREH FRQVLGHUHG DQG WKH GHVLJQ DQG LPSOHPHQWDWLRQ RI WKH
FRXQWHUPHDVXUHLVWREHUHHYDOXDWHG7KLVLVLQGLFDWHGE\WKHGDVKHGEDFNZDUGVRUL FRXQWHUPHDVXUHLVWREHUHHYDOXDWHG7KLVLVLQGLFDWHGE\WKHGDVKHGEDFNZDUGVRUL
HQWDWHGDUURZRQWKHULJKWKDQGVLGH HQWDWHGDUURZRQWKHULJKWKDQGVLGH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 
,QWURGXFWLRQ 2EMHFWLYHVRI7KHVLV ,QWURGXFWLRQ 2EMHFWLYHVRI7KHVLV

7KHSURSRVHGDSSURDFKWRZDUGVWKHILUVWWKUHHGHVLJQSKDVHVLHJHQHUDOWKHUPRG\ 7KHSURSRVHGDSSURDFKWRZDUGVWKHILUVWWKUHHGHVLJQSKDVHVLHJHQHUDOWKHUPRG\
QDPLFDQGNLQHWLFFRQVLGHUDWLRQVDVZHOODVWKHGHYHORSPHQWRIWKHRUHWLFDOSULQFLSOHV QDPLFDQGNLQHWLFFRQVLGHUDWLRQVDVZHOODVWKHGHYHORSPHQWRIWKHRUHWLFDOSULQFLSOHV
IRUSURFHVVHVDQGLPSOHPHQWDWLRQRIQHZFRXQWHUPHDVXUHVDQGWKHGHVLJQRIUHTXLUHG IRUSURFHVVHVDQGLPSOHPHQWDWLRQRIQHZFRXQWHUPHDVXUHVDQGWKHGHVLJQRIUHTXLUHG
WHVWPHWKRGVDQGVHWXSVFRQVWLWXWHWKHFHQWUDOVXEMHFWRIWKLVWKHVLV WHVWPHWKRGVDQGVHWXSVFRQVWLWXWHWKHFHQWUDOVXEMHFWRIWKLVWKHVLV

 2EMHFWLYHVRI7KHVLV  2EMHFWLYHVRI7KHVLV


7KLVWKHVLVLVPHDQWWRHVWDEOLVKDFRQVLVWHQWWKHUPRG\QDPLFEDVLVIRUWKHGHVFULSWLRQ 7KLVWKHVLVLVPHDQWWRHVWDEOLVKDFRQVLVWHQWWKHUPRG\QDPLFEDVLVIRUWKHGHVFULSWLRQ
RIFRUURVLRQSURFHVVHVDVZHOODVIRUWKHHYDOXDWLRQRIH[LVWLQJDQGWKHGHYHORSPHQWRI RIFRUURVLRQSURFHVVHVDVZHOODVIRUWKHHYDOXDWLRQRIH[LVWLQJDQGWKHGHYHORSPHQWRI
QHZFRUURVLRQFRXQWHUPHDVXUHV+HQFHLWVFHQWUDODLPVDQGFRQWHQWVDUHWKHDGDSWD QHZFRUURVLRQFRXQWHUPHDVXUHV+HQFHLWVFHQWUDODLPVDQGFRQWHQWVDUHWKHDGDSWD
WLRQ RI DYDLODEOH WKHUPRG\QDPLFSULQFLSOHVWRWKHDUHDRIUHLQIRUFHPHQW FRUURVLRQD WLRQ RI DYDLODEOH WKHUPRG\QDPLFSULQFLSOHVWRWKHDUHDRIUHLQIRUFHPHQW FRUURVLRQD
WKHUPRG\QDPLFDOO\ FRQVLVWHQW GHVFULSWLRQ RI WKH GLYHUVH FRUURVLRQ VWDWHV RI VWHHO LQ WKHUPRG\QDPLFDOO\ FRQVLVWHQW GHVFULSWLRQ RI WKH GLYHUVH FRUURVLRQ VWDWHV RI VWHHO LQ
FRQFUHWHDUHYLHZDQGHYDOXDWLRQRIDYDLODEOHPHDVXUHVIRUFRUURVLRQSURWHFWLRQDQG FRQFUHWHDUHYLHZDQGHYDOXDWLRQRIDYDLODEOHPHDVXUHVIRUFRUURVLRQSURWHFWLRQDQG
WKH GHYHORSPHQW RI WKHRUHWLFDO FRQFHSWV IRU QHZ FRVWHIILFLHQW FRXQWHUPHDVXUHV ,Q WKH GHYHORSPHQW RI WKHRUHWLFDO FRQFHSWV IRU QHZ FRVWHIILFLHQW FRXQWHUPHDVXUHV ,Q
DGGLWLRQWRWKHVHWKHRUHWLFDOFRQVLGHUDWLRQVWZRSUDFWLFDOLPSOHPHQWDWLRQVRIWKHWKHR DGGLWLRQWRWKHVHWKHRUHWLFDOFRQVLGHUDWLRQVWZRSUDFWLFDOLPSOHPHQWDWLRQVRIWKHWKHR
UHWLFDO FRQFHSWV DUH RXWOLQHG DQG FXVWRPGHVLJQHG VHWXSV DQG PHDVXUHPHQW PHWKRGV UHWLFDO FRQFHSWV DUH RXWOLQHG DQG FXVWRPGHVLJQHG VHWXSV DQG PHDVXUHPHQW PHWKRGV
IRUSHUIRUPDQFHWHVWLQJDUHGLVFXVVHG IRUSHUIRUPDQFHWHVWLQJDUHGLVFXVVHG
$OWKRXJKWKHODUJHVWSDUWRIWKLVSURMHFWZDVH[SHULPHQWDOWKHPDMRUSDUWRIWKLVWKHVLV $OWKRXJKWKHODUJHVWSDUWRIWKLVSURMHFWZDVH[SHULPHQWDOWKHPDMRUSDUWRIWKLVWKHVLV
GHDOVZLWKWKHRUHWLFDOSULQFLSOHV FI6HFWLRQ 6HOHFWHGH[SHULPHQWDOREVHUYDWLRQV GHDOVZLWKWKHRUHWLFDOSULQFLSOHV FI6HFWLRQ 6HOHFWHGH[SHULPHQWDOREVHUYDWLRQV
RUUHVXOWVDUHUHIHUUHGWRWKURXJKRXWWKLVWKHVLVLQFRQQHFWLRQZLWKWKHGLVFXVVHGWKHR RUUHVXOWVDUHUHIHUUHGWRWKURXJKRXWWKLVWKHVLVLQFRQQHFWLRQZLWKWKHGLVFXVVHGWKHR
UHWLFDOFRQFHSWV FI6HFWLRQ :LWKUHJDUGWRH[SHFWHGSDWHQWSRVVLELOLWLHVVRPHRI UHWLFDOFRQFHSWV FI6HFWLRQ :LWKUHJDUGWRH[SHFWHGSDWHQWSRVVLELOLWLHVVRPHRI
WKHNH\WKHRUHWLFDOFRQFHSWVDQGPRVWRIWKHUHVXOWVRIWKHH[SHULPHQWDOLQYHVWLJDWLRQV WKHNH\WKHRUHWLFDOFRQFHSWVDQGPRVWRIWKHUHVXOWVRIWKHH[SHULPHQWDOLQYHVWLJDWLRQV
DUHQRWLQFOXGHGLQWKHSUHVHQWWKHVLV7KLVKROGVLQSDUWLFXODUIRUWKHSURGXFWLRQDQG DUHQRWLQFOXGHGLQWKHSUHVHQWWKHVLV7KLVKROGVLQSDUWLFXODUIRUWKHSURGXFWLRQDQG
LPSOHPHQWDWLRQRIWKHSURSRVHGQHZFRXQWHUPHDVXUHV FI6HFWLRQDQG&KDSWHU LPSOHPHQWDWLRQRIWKHSURSRVHGQHZFRXQWHUPHDVXUHV FI6HFWLRQDQG&KDSWHU
 7KHUHODWHGWKHRUHWLFDOFRQFHSWVDQGH[SHULPHQWDOUHVXOWVZLOOEHGHDOWZLWKLQIX  7KHUHODWHGWKHRUHWLFDOFRQFHSWVDQGH[SHULPHQWDOUHVXOWVZLOOEHGHDOWZLWKLQIX
WXUHSXEOLFDWLRQV WXUHSXEOLFDWLRQV

 6FRSHRI7KHVLV  6FRSHRI7KHVLV


7KLVWKHVLVLVPHDQWIRUDUHDGHUZLWKDEDFNJURXQGLQHLWKHUFLYLOHQJLQHHULQJRUPDWH 7KLVWKHVLVLVPHDQWIRUDUHDGHUZLWKDEDFNJURXQGLQHLWKHUFLYLOHQJLQHHULQJRUPDWH
ULDOVDQGFKHPLFDOHQJLQHHULQJ7KHLQWHQWLRQLVWRLQWURGXFHWKHXQGHUO\LQJWKHRU\DQG ULDOVDQGFKHPLFDOHQJLQHHULQJ7KHLQWHQWLRQLVWRLQWURGXFHWKHXQGHUO\LQJWKHRU\DQG
FRQFHSWV RI FRUURVLRQ VFLHQFH DQG FRQFUHWH WHFKQRORJ\ IURP D UDWKHU IXQGDPHQWDO FRQFHSWV RI FRUURVLRQ VFLHQFH DQG FRQFUHWH WHFKQRORJ\ IURP D UDWKHU IXQGDPHQWDO
OHYHOWRZKDWLVFRQVLGHUHGDVWKHQHFHVVDU\WKHRUHWLFDOEDFNJURXQGRIWKHREMHFWLYHV OHYHOWRZKDWLVFRQVLGHUHGDVWKHQHFHVVDU\WKHRUHWLFDOEDFNJURXQGRIWKHREMHFWLYHV
RIWKLVWKHVLV RIWKLVWKHVLV
0RVWRIWKHGHVFULEHGWKHRU\FRQFHUQLQJDTXHRXVPHWDOOLFFRUURVLRQLQSDUWLFXODUWKH 0RVWRIWKHGHVFULEHGWKHRU\FRQFHUQLQJDTXHRXVPHWDOOLFFRUURVLRQLQSDUWLFXODUWKH
RQHFRQFHUQLQJWKHUPRG\QDPLFVLVQRWRURQO\PDUJLQDOO\WUHDWHGLQWKHOLWHUDWXUHRQ RQHFRQFHUQLQJWKHUPRG\QDPLFVLVQRWRURQO\PDUJLQDOO\WUHDWHGLQWKHOLWHUDWXUHRQ
UHLQIRUFHPHQW FRUURVLRQ 0RUHRYHU WKH WHUPLQRORJ\ DQG WKH DSSOLFDWLRQRIWKHWKHR UHLQIRUFHPHQW FRUURVLRQ 0RUHRYHU WKH WHUPLQRORJ\ DQG WKH DSSOLFDWLRQRIWKHWKHR
UHWLFDOPRGHOVDQGWRROVXVHGLQWKLVWKHVLVGLIIHUWRVRPHH[WHQWIURPFRUURVLRQVFL UHWLFDOPRGHOVDQGWRROVXVHGLQWKLVWKHVLVGLIIHUWRVRPHH[WHQWIURPFRUURVLRQVFL
HQFH7KHUHIRUHWKHFRUURVLRQWKHRU\LVH[SODLQHGVWDUWLQJIURPWKHEDVLFFRQFHSWVRI HQFH7KHUHIRUHWKHFRUURVLRQWKHRU\LVH[SODLQHGVWDUWLQJIURPWKHEDVLFFRQFHSWVRI
DTXHRXV PHWDOOLF FRUURVLRQ ZKLFK PLJKW DSSHDU WULYLDO WR WKH UHDGHU ZLWK D EDFN DTXHRXV PHWDOOLF FRUURVLRQ ZKLFK PLJKW DSSHDU WULYLDO WR WKH UHDGHU ZLWK D EDFN
JURXQG LQ PDWHULDOV RU FKHPLFDO HQJLQHHULQJ 2Q WKH RWKHU KDQG VRPH RI WKH EDFN JURXQG LQ PDWHULDOV RU FKHPLFDO HQJLQHHULQJ 2Q WKH RWKHU KDQG VRPH RI WKH EDFN
JURXQG FRQFHUQLQJ FRQFUHWH WHFKQRORJ\ DQG VWUXFWXUDO FRQFUHWH ZKLFK LV FRQVLGHUHG JURXQG FRQFHUQLQJ FRQFUHWH WHFKQRORJ\ DQG VWUXFWXUDO FRQFUHWH ZKLFK LV FRQVLGHUHG

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN
2XWOLQHRI7KHVLV ,QWURGXFWLRQ 2XWOLQHRI7KHVLV ,QWURGXFWLRQ

WREHHVVHQWLDOWRXQGHUVWDQGLQJWKHFRPSOH[SK\VLFDODQGFKHPLFDOSURSHUWLHVRIWKH WREHHVVHQWLDOWRXQGHUVWDQGLQJWKHFRPSOH[SK\VLFDODQGFKHPLFDOSURSHUWLHVRIWKH
FRQFUHWHVWHHOFRPSRVLWHV\VWHPPLJKWEHWULYLDOWRWKHUHDGHUZLWKDFLYLOHQJLQHHULQJ FRQFUHWHVWHHOFRPSRVLWHV\VWHPPLJKWEHWULYLDOWRWKHUHDGHUZLWKDFLYLOHQJLQHHULQJ
EDFNJURXQG EDFNJURXQG
(PSKDVLVLVVHWRQWKHDSSOLFDWLRQRIHOHFWURFKHPLFDOSULQFLSOHVDQGHVVHQWLDODVSHFWV (PSKDVLVLVVHWRQWKHDSSOLFDWLRQRIHOHFWURFKHPLFDOSULQFLSOHVDQGHVVHQWLDODVSHFWV
RIFRQFUHWHWHFKQRORJ\UDWKHUWKDQRQGHWDLOHGWKHRUHWLFDOEDFNJURXQGHJGHULYDWLRQ RIFRQFUHWHWHFKQRORJ\UDWKHUWKDQRQGHWDLOHGWKHRUHWLFDOEDFNJURXQGHJGHULYDWLRQ
RIWKHDSSOLHGIRUPXODV7KHWUHDWHGVXEMHFWVDUHWKHUHE\OLPLWHGWRZKDWLVFRQVLGHUHG RIWKHDSSOLHGIRUPXODV7KHWUHDWHGVXEMHFWVDUHWKHUHE\OLPLWHGWRZKDWLVFRQVLGHUHG
WREHUHOHYDQWWRFRPSUHKHQGRXUDSSOLFDWLRQRIHOHFWURFKHPLFDOSULQFLSOHVLQWKHDUHD WREHUHOHYDQWWRFRPSUHKHQGRXUDSSOLFDWLRQRIHOHFWURFKHPLFDOSULQFLSOHVLQWKHDUHD
RIUHLQIRUFHPHQWFRUURVLRQ+HQFHWKHWKHRUHWLFDOSDUWRIWKLVWKHVLVGRHVE\QRPHDQV RIUHLQIRUFHPHQWFRUURVLRQ+HQFHWKHWKHRUHWLFDOSDUWRIWKLVWKHVLVGRHVE\QRPHDQV
UHSUHVHQWDFRPSOHWHVXPPDU\RIDOODVSHFWVRIWKHWZREURDGDQGFRPSOH[GLVFLSOLQHV UHSUHVHQWDFRPSOHWHVXPPDU\RIDOODVSHFWVRIWKHWZREURDGDQGFRPSOH[GLVFLSOLQHV
RIFRUURVLRQVFLHQFHDQGFRQFUHWHWHFKQRORJ\ RIFRUURVLRQVFLHQFHDQGFRQFUHWHWHFKQRORJ\

 2XWOLQHRI7KHVLV  2XWOLQHRI7KHVLV


7KLVWKHVLVFRPSULVHVDOWRJHWKHUQLQHPDLQ&KDSWHUV$IWHUWKH³,QWURGXFWLRQ´LQWKLV 7KLVWKHVLVFRPSULVHVDOWRJHWKHUQLQHPDLQ&KDSWHUV$IWHUWKH³,QWURGXFWLRQ´LQWKLV
&KDSWHUWKHFRQWHQWVRIWKHVXEVHTXHQW&KDSWHUVFDQEHVXPPDULVHGDVIROORZV &KDSWHUWKHFRQWHQWVRIWKHVXEVHTXHQW&KDSWHUVFDQEHVXPPDULVHGDVIROORZV
‡ ,Q&KDSWHUDQLQWURGXFWLRQWRVHOHFWHGWKHRUHWLFDOPRGHOVDQGWRROVIRUWKHGH ‡ ,Q&KDSWHUDQLQWURGXFWLRQWRVHOHFWHGWKHRUHWLFDOPRGHOVDQGWRROVIRUWKHGH
VFULSWLRQRIPHWDOOLFFRUURVLRQLVSURYLGHGZLWKHPSKDVLVRQWKHUPRG\QDPLFV,Q VFULSWLRQRIPHWDOOLFFRUURVLRQLVSURYLGHGZLWKHPSKDVLVRQWKHUPRG\QDPLFV,Q
FRPELQDWLRQZLWKWKHUHOHYDQWLQIRUPDWLRQRQFRQFUHWHDQGFDUERQVWHHOSURSHUWLHV FRPELQDWLRQZLWKWKHUHOHYDQWLQIRUPDWLRQRQFRQFUHWHDQGFDUERQVWHHOSURSHUWLHV
&KDSWHU WKHVHWRROVDUHVHHQDVWKHYHU\IXQGDPHQWDOVIRUWKHWKHRUHWLFDOFRQ &KDSWHU WKHVHWRROVDUHVHHQDVWKHYHU\IXQGDPHQWDOVIRUWKHWKHRUHWLFDOFRQ
VLGHUDWLRQV &KDSWHUV  WR   DQG IRU WKH SHUIRUPHG H[SHULPHQWDO LQYHVWLJDWLRQV VLGHUDWLRQV &KDSWHUV  WR   DQG IRU WKH SHUIRUPHG H[SHULPHQWDO LQYHVWLJDWLRQV
6HFWLRQDQG&KDSWHU  6HFWLRQDQG&KDSWHU 
‡ ,Q&KDSWHUWKHH[LVWLQJNQRZOHGJHRQFRQFUHWHDQGFDUERQVWHHOSURSHUWLHVWKDW ‡ ,Q&KDSWHUWKHH[LVWLQJNQRZOHGJHRQFRQFUHWHDQGFDUERQVWHHOSURSHUWLHVWKDW
DUHUHOHYDQWIRUUHLQIRUFHPHQWFRUURVLRQLVFULWLFDOO\UHYLHZHG7DNLQJLQWRDFFRXQW DUHUHOHYDQWIRUUHLQIRUFHPHQWFRUURVLRQLVFULWLFDOO\UHYLHZHG7DNLQJLQWRDFFRXQW
WKHPXOWLIDFHWHG FKHPLVWU\RI FRQFUHWHDQGLWVSDUWLFXODUSK\VLFDOFKDUDFWHULVWLFV WKHPXOWLIDFHWHG FKHPLVWU\RI FRQFUHWHDQGLWVSDUWLFXODUSK\VLFDOFKDUDFWHULVWLFV
DVZHOODVWKHPHWDOOXUJLFDOSURSHUWLHVRIWKHFDUERQVWHHOWKHFRQFUHWHVWHHOV\V DVZHOODVWKHPHWDOOXUJLFDOSURSHUWLHVRIWKHFDUERQVWHHOWKHFRQFUHWHVWHHOV\V
WHP UHSUHVHQWV D FRPSOH[ FKHPLFDO DQG HOHFWURFKHPLFDO V\VWHP 7KH GHVFULSWLRQ WHP UHSUHVHQWV D FRPSOH[ FKHPLFDO DQG HOHFWURFKHPLFDO V\VWHP 7KH GHVFULSWLRQ
RIFRUURVLRQSURFHVVHVLQVXFKV\VWHP &KDSWHU ZKLFKZHFRQVLGHUWREHDQLP RIFRUURVLRQSURFHVVHVLQVXFKV\VWHP &KDSWHU ZKLFKZHFRQVLGHUWREHDQLP
SRUWDQW EDVLV IRU WKH HYDOXDWLRQ RI H[LVWLQJ &KDSWHU   DQG WKH GHVLJQ RI QHZ SRUWDQW EDVLV IRU WKH HYDOXDWLRQ RI H[LVWLQJ &KDSWHU   DQG WKH GHVLJQ RI QHZ
FRXQWHUPHDVXUHV &KDSWHU   UHTXLUHV D GHWDLOHG XQGHUVWDQGLQJ RI WKH JRYHUQLQJ FRXQWHUPHDVXUHV &KDSWHU   UHTXLUHV D GHWDLOHG XQGHUVWDQGLQJ RI WKH JRYHUQLQJ
SDUDPHWHUV SDUDPHWHUV
‡ &KDSWHU  GHDOV ZLWK RXU JHQHUDO XQGHUVWDQGLQJ DQG DSSOLFDWLRQ RI WKHUPRG\ ‡ &KDSWHU  GHDOV ZLWK RXU JHQHUDO XQGHUVWDQGLQJ DQG DSSOLFDWLRQ RI WKHUPRG\
QDPLFGDWDPRGHOVDQGWRROVZLWKSULPDU\IRFXVRQ3RXUEDL[GLDJUDPV7KHH[ QDPLFGDWDPRGHOVDQGWRROVZLWKSULPDU\IRFXVRQ3RXUEDL[GLDJUDPV7KHH[
WHQVLRQDQGDSSOLFDWLRQ RIWKH DYDLODEOH DTXHRXV PHWDOOLF FRUURVLRQWKHRU\ WRWKH WHQVLRQDQGDSSOLFDWLRQ RIWKHDYDLODEOHDTXHRXVPHWDOOLFFRUURVLRQWKHRU\ WRWKH
FRQFUHWH HQYLURQPHQW LV GLVFXVVHG LQ GHWDLO ZLWK VSHFLDO IRFXV RQ WKH FRQFUHWH FRQFUHWH HQYLURQPHQW LV GLVFXVVHG LQ GHWDLO ZLWK VSHFLDO IRFXV RQ WKH FRQFUHWH
VWHHOV\VWHP &KDSWHU  VWHHOV\VWHP &KDSWHU 
‡ &KDSWHU  GHPRQVWUDWHV WKH DSSOLFDWLRQ RI WKH H[WHQGHG DQG DGDSWHG WKHUPRG\ ‡ &KDSWHU  GHPRQVWUDWHV WKH DSSOLFDWLRQ RI WKH H[WHQGHG DQG DGDSWHG WKHUPRG\
QDPLFPRGHOVHVWDEOLVKHGLQ&KDSWHULQFRPELQDWLRQZLWKWKHWKHRU\RQFRQFUHWH QDPLFPRGHOVHVWDEOLVKHGLQ&KDSWHULQFRPELQDWLRQZLWKWKHWKHRU\RQFRQFUHWH
DQGFDUERQVWHHO &KDSWHU IRUWKHGHVFULSWLRQRIGLIIHUHQWUHLQIRUFHPHQWFRUUR DQGFDUERQVWHHO &KDSWHU IRUWKHGHVFULSWLRQRIGLIIHUHQWUHLQIRUFHPHQWFRUUR
VLRQSURFHVVHV$IWHUVRPHJHQHUDOQRWHVRQRXUFRQFHSWRIWKHHOHFWURFKHPLVWU\RI VLRQSURFHVVHV$IWHUVRPHJHQHUDOQRWHVRQRXUFRQFHSWRIWKHHOHFWURFKHPLVWU\RI
VWHHO LQ FRQFUHWH RXU SURSRVHG PRGHOV DUH YHULILHG DJDLQVW DQG FRPSDUHG WR GH VWHHO LQ FRQFUHWH RXU SURSRVHG PRGHOV DUH YHULILHG DJDLQVW DQG FRPSDUHG WR GH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 
,QWURGXFWLRQ 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV ,QWURGXFWLRQ 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV

VFULSWLRQVWKDWKDYHEHHQSRVWXODWHGLQWKHOLWHUDWXUH(PSKDVLVLVVHWRQWKHWKHU VFULSWLRQVWKDWKDYHEHHQSRVWXODWHGLQWKHOLWHUDWXUH(PSKDVLVLVVHWRQWKHWKHU
PRG\QDPLFPRGHOVZKHUHDVRWKHUDVSHFWVDUHGHDOWZLWKUDWKHUEULHIO\ PRG\QDPLFPRGHOVZKHUHDVRWKHUDVSHFWVDUHGHDOWZLWKUDWKHUEULHIO\
‡ &KDSWHUJLYHVDQLQWURGXFWLRQWRGXUDELOLW\GHVLJQDQGGHVFULSWLRQVDQGHYDOXD ‡ &KDSWHUJLYHVDQLQWURGXFWLRQWRGXUDELOLW\GHVLJQDQGGHVFULSWLRQVDQGHYDOXD
WLRQVRIWKHPRVWLPSRUWDQWDYDLODEOHFRXQWHUPHDVXUHVDVZHOODVVHOHFWHGPDUJLQDO WLRQVRIWKHPRVWLPSRUWDQWDYDLODEOHFRXQWHUPHDVXUHVDVZHOODVVHOHFWHGPDUJLQDO
WHFKQLTXHVZKLFKDUHRIUHOHYDQFHWRWKHQHZSURSRVHGFRXQWHUPHDVXUHV &KDS WHFKQLTXHV ZKLFK DUH RI UHOHYDQFHWRWKHQHZSURSRVHGFRXQWHUPHDVXUHV &KDS
WHU 7KHXQGHUO\LQJSULQFLSOHVDQGWKHPRVWLPSRUWDQWDVSHFWVRIWKHGHVFULEHG WHU 7KHXQGHUO\LQJSULQFLSOHVDQGWKHPRVWLPSRUWDQWDVSHFWVRIWKHGHVFULEHG
FRXQWHUPHDVXUHVDUHGLVFXVVHGDQGHYDOXDWHGEDVHGRQDFULWLFDOUHYLHZRIWKHOLW FRXQWHUPHDVXUHVDUHGLVFXVVHGDQGHYDOXDWHGEDVHGRQDFULWLFDOUHYLHZRIWKHOLW
HUDWXUH DV ZHOO DV RQ RZQ WKHRUHWLFDO FRQVLGHUDWLRQV DQG H[SHULPHQWDO REVHUYD HUDWXUH DV ZHOO DV RQ RZQ WKHRUHWLFDO FRQVLGHUDWLRQV DQG H[SHULPHQWDO REVHUYD
WLRQV 7KH DSSOLFDWLRQ RI WKHUPRG\QDPLF PRGHOV DQG WRROV LV LQGLFDWHG EXW QRW WLRQV 7KH DSSOLFDWLRQ RI WKHUPRG\QDPLF PRGHOV DQG WRROV LV LQGLFDWHG EXW QRW
HODERUDWHGLQGHWDLO DVHJLQ&KDSWHU  HODERUDWHGLQGHWDLO DVHJLQ&KDSWHU 
‡ ,Q &KDSWHU  GHVLJQ UHTXLUHPHQWV DUH IRUPXODWHG DQG RXU SURSRVHG WKHRUHWLFDO ‡ ,Q &KDSWHU  GHVLJQ UHTXLUHPHQWV DUH IRUPXODWHG DQG RXU SURSRVHG WKHRUHWLFDO
DQG SUDFWLFDO FRQFHSWV IRU WKH GHVLJQ RI QHZ FRXQWHUPHDVXUHV LV VXPPDULVHG ,W DQG SUDFWLFDO FRQFHSWV IRU WKH GHVLJQ RI QHZ FRXQWHUPHDVXUHV LV VXPPDULVHG ,W
SUHVHQWV WKH ILQDO DSSOLFDWLRQ RI WKH DYDLODEOH WKHRU\ JLYHQ LQ &KDSWHUV  DQG  SUHVHQWV WKH ILQDO DSSOLFDWLRQ RI WKH DYDLODEOH WKHRU\ JLYHQ LQ &KDSWHUV  DQG 
ZKLFKZDVH[WHQGHGDQGWUDQVIHUUHGWRWKHGHVFULSWLRQRIUHLQIRUFHPHQWFRUURVLRQ ZKLFKZDVH[WHQGHGDQGWUDQVIHUUHGWRWKHGHVFULSWLRQRIUHLQIRUFHPHQWFRUURVLRQ
SURFHVVHVDQGWRWKHHYDOXDWLRQDQGGHVLJQRIFRXQWHUPHDVXUHVWKURXJKRXW&KDS SURFHVVHVDQGWRWKHHYDOXDWLRQDQGGHVLJQRIFRXQWHUPHDVXUHVWKURXJKRXW&KDS
WHUVWR:KLOHPRVWRIWKHDYDLODEOHFRXQWHUPHDVXUHVLQYHVWLJDWHGLQ&KDSWHU WHUVWR:KLOHPRVWRIWKHDYDLODEOHFRXQWHUPHDVXUHVLQYHVWLJDWHGLQ&KDSWHU
DUHUXOHGRXWIURPIXUWKHUFRQVLGHUDWLRQWKHXQGHUO\LQJSULQFLSOHVRIVRPHDYDLO DUHUXOHGRXWIURPIXUWKHUFRQVLGHUDWLRQWKHXQGHUO\LQJSULQFLSOHVRIVRPHDYDLO
DEOHFRXQWHUPHDVXUHVFRQWULEXWHWRWKHFRQFHSWVRIWKHQHZSURSRVHGFRXQWHUPHD DEOHFRXQWHUPHDVXUHVFRQWULEXWHWRWKHFRQFHSWVRIWKHQHZSURSRVHGFRXQWHUPHD
VXUHV7KLV&KDSWHUFRQWDLQVWKHFHQWUDOREMHFWLYHRIWKLVWKHVLV FI 6HFWLRQ   VXUHV7KLV&KDSWHUFRQWDLQVWKH FHQWUDO REMHFWLYH RI WKLV WKHVLV FI 6HFWLRQ  
+RZHYHUZLWKUHJDUGWRWKHH[SHFWHGSDWHQWSRVVLELOLWLHVRQO\OLPLWHGLQIRUPDWLRQ +RZHYHUZLWKUHJDUGWRWKHH[SHFWHGSDWHQWSRVVLELOLWLHVRQO\OLPLWHGLQIRUPDWLRQ
RQ WKH WKHRUHWLFDO FRQFHSWV DV ZHOO DV RQ SURGXFWLRQ DQG LPSOHPHQWDWLRQ RI WKH RQ WKH WKHRUHWLFDO FRQFHSWV DV ZHOO DV RQ SURGXFWLRQ DQG LPSOHPHQWDWLRQ RI WKH
FRXQWHUPHDVXUHV LV JLYHQ FI 6HFWLRQ   )LQDOO\ UHTXLUHPHQWV IRU ODERUDWRU\ FRXQWHUPHDVXUHV LV JLYHQ FI 6HFWLRQ   )LQDOO\ UHTXLUHPHQWV IRU ODERUDWRU\
WHVWLQJRIFRXQWHUPHDVXUHVDUHGLVFXVVHG WHVWLQJRIFRXQWHUPHDVXUHVDUHGLVFXVVHG
‡ &KDSWHUGHVFULEHVRXUDSSURDFKWRZDUGVWHVWLQJRIDYDLODEOHDQGQHZFRXQWHU ‡ &KDSWHUGHVFULEHVRXUDSSURDFKWRZDUGVWHVWLQJRIDYDLODEOHDQGQHZFRXQWHU
PHDVXUHVEDVHGRQWKHUHTXLUHPHQWVIRUPXODWHGLQ&KDSWHUZLWKIRFXVRQHOHF PHDVXUHVEDVHGRQWKHUHTXLUHPHQWVIRUPXODWHGLQ&KDSWHUZLWKIRFXVRQHOHF
WURFKHPLFDOWHVWLQJDQGHYDOXDWLRQ7KHGHVLJQDQGIHDWXUHVRIWKHDSSOLHGVSHFL WURFKHPLFDOWHVWLQJDQGHYDOXDWLRQ7KHGHVLJQDQGIHDWXUHVRIWKHDSSOLHGVSHFL
PHQW\SHVWKHFHQWUDODVSHFWVRIWKHKLJKFDSDFLW\H[SRVXUHDQGPRQLWRULQJVHWXS PHQW\SHVWKHFHQWUDODVSHFWVRIWKHKLJKFDSDFLW\H[SRVXUHDQGPRQLWRULQJVHWXS
XVHG IRU HOHFWURFKHPLFDO WHVWLQJ DV ZHOO DV WKH LPSOHPHQWDWLRQ RI WKH UHTXLUHG XVHG IRU HOHFWURFKHPLFDO WHVWLQJ DV ZHOO DV WKH LPSOHPHQWDWLRQ RI WKH UHTXLUHG
PRQLWRULQJDQGPHDVXUHPHQWWHFKQLTXHV FI&KDSWHUVDQG DUHGHVFULEHGLQ PRQLWRULQJDQGPHDVXUHPHQWWHFKQLTXHV FI&KDSWHUVDQG DUHGHVFULEHGLQ
GHWDLO GHWDLO
‡ )LQDOO\&KDSWHUVXPPDULVHVWKHPRVWLPSRUWDQWILQGLQJVRI&KDSWHUVWRDQG ‡ )LQDOO\&KDSWHUVXPPDULVHVWKHPRVWLPSRUWDQWILQGLQJVRI&KDSWHUVWRDQG
SURYLGHVUHFRPPHQGDWLRQVIRUIXWXUHLQYHVWLJDWLRQV SURYLGHVUHFRPPHQGDWLRQVIRUIXWXUHLQYHVWLJDWLRQV

 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV  2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV


,Q WKLV 6HFWLRQ WKH PRVW LPSRUWDQW H[SHULPHQWDO LQYHVWLJDWLRQV SDUDPHWHUV DQG SHU ,Q WKLV 6HFWLRQ WKH PRVW LPSRUWDQW H[SHULPHQWDO LQYHVWLJDWLRQV SDUDPHWHUV DQG SHU
IRUPDQFHVDUHYHU\EULHIO\VXPPDULVHGWRSURYLGHWKHEDFNJURXQGRIWKHREVHUYDWLRQV IRUPDQFHVDUHYHU\EULHIO\VXPPDULVHGWRSURYLGHWKHEDFNJURXQGRIWKHREVHUYDWLRQV
DQGUHVXOWVUHIHUUHGWRLQWKLVWKHVLV,WLVLPSRUWDQWWRQRWHWKDWWKLV6HFWLRQVKRXOGEH DQGUHVXOWVUHIHUUHGWRLQWKLVWKHVLV,WLVLPSRUWDQWWRQRWHWKDWWKLV6HFWLRQVKRXOGEH
XQGHUVWRRG DV D UHIHUHQFH WR EH FRQVXOWHG LQ FRQQHFWLRQ ZLWK WKH REVHUYDWLRQV DQG XQGHUVWRRG DV D UHIHUHQFH WR EH FRQVXOWHG LQ FRQQHFWLRQ ZLWK WKH REVHUYDWLRQV DQG
UHVXOWV UHIHUUHG WR WKURXJKRXW WKH WKHVLV UDWKHU WKDQ D FRPSOHWH LQWURGXFWLRQ WR WKH UHVXOWV UHIHUUHG WR WKURXJKRXW WKH WKHVLV UDWKHU WKDQ D FRPSOHWH LQWURGXFWLRQ WR WKH

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV ,QWURGXFWLRQ 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV ,QWURGXFWLRQ

H[SHULPHQWDO SHUIRUPDQFHV $ PRUH GHWDLOHG LQWURGXFWLRQ WR WKH H[SHULPHQWDO VHWXS H[SHULPHQWDO SHUIRUPDQFHV $ PRUH GHWDLOHG LQWURGXFWLRQ WR WKH H[SHULPHQWDO VHWXS
DQGSHUIRUPDQFHVLVJLYHQLQ&KDSWHU DQGSHUIRUPDQFHVLVJLYHQLQ&KDSWHU
7KHH[SHULPHQWDOSHUIRUPDQFHVLQFOXGHGLQWKHSUHVHQWWKHVLVDUHUHODWHGWRWKHSUDFWL 7KHH[SHULPHQWDOSHUIRUPDQFHVLQFOXGHGLQWKHSUHVHQWWKHVLVDUHUHODWHGWRWKHSUDFWL
FDO UHDOLVDWLRQ RI WKH SURSRVHG QHZ FRXQWHUPHDVXUHV DV ZHOO DV WR WKHLU WHVWLQJ DQG FDO UHDOLVDWLRQ RI WKH SURSRVHG QHZ FRXQWHUPHDVXUHV DV ZHOO DV WR WKHLU WHVWLQJ DQG
FRPSDULVRQWRDYDLODEOHFRXQWHUPHDVXUHV)XUWKHUPRUHWKHGHVLJQPDQXIDFWXUHDQG FRPSDULVRQWRDYDLODEOHFRXQWHUPHDVXUHV)XUWKHUPRUHWKHGHVLJQPDQXIDFWXUHDQG
WHVWLQJRIVXLWDEOHH[SHULPHQWDOVHWXSVDQGPHDVXULQJWHFKQLTXHVFRQVWLWXWHGDPDMRU WHVWLQJRIVXLWDEOHH[SHULPHQWDOVHWXSVDQGPHDVXULQJWHFKQLTXHVFRQVWLWXWHGDPDMRU
SDUWRIWKHSUDFWLFDOZRUNDQGWKHH[SHULPHQWDOSHUIRUPDQFHV7KHILQDOWHVWVHWXSIRU SDUWRIWKHSUDFWLFDOZRUNDQGWKHH[SHULPHQWDOSHUIRUPDQFHV7KHILQDOWHVWVHWXSIRU
HOHFWURFKHPLFDOLQYHVWLJDWLRQVLVGHVFULEHGLQGHWDLOLQ&KDSWHUZKLFKDOVRSURYLGHV HOHFWURFKHPLFDOLQYHVWLJDWLRQVLVGHVFULEHGLQGHWDLOLQ&KDSWHUZKLFKDOVRSURYLGHV
LQIRUPDWLRQ RQ WKH DSSOLHG HOHFWURFKHPLFDO PHDVXUHPHQWV DQG WKHLU FXVWRPLVDWLRQ LQIRUPDWLRQ RQ WKH DSSOLHG HOHFWURFKHPLFDO PHDVXUHPHQWV DQG WKHLU FXVWRPLVDWLRQ
6XSSOHPHQWDU\ H[SHULPHQWDO PHWKRGV LQFOXGHG PLFURVFRSLF DQG ;UD\ DQDO\VHV DV 6XSSOHPHQWDU\ H[SHULPHQWDO PHWKRGV LQFOXGHG PLFURVFRSLF DQG ;UD\ DQDO\VHV DV
ZHOODVFKHPLFDODQDO\VHV7KHVHPHWKRGVDUHGHVFULEHGLQFRQQHFWLRQZLWKWKHLQYHV ZHOODVFKHPLFDODQDO\VHV7KHVHPHWKRGVDUHGHVFULEHGLQFRQQHFWLRQZLWKWKHLQYHV
WLJDWHGSDUDPHWHUVLQ&KDSWHU LQUHODWLRQWRJHQHUDOSURSHUWLHVRIFRQFUHWHDQGFDU WLJDWHGSDUDPHWHUVLQ&KDSWHU LQUHODWLRQWRJHQHUDOSURSHUWLHVRIFRQFUHWHDQGFDU
ERQVWHHOUHLQIRUFHPHQW DQGLQ&KDSWHU LQUHODWLRQWRUHLQIRUFHPHQWFRUURVLRQ  ERQVWHHOUHLQIRUFHPHQW DQGLQ&KDSWHU LQUHODWLRQWRUHLQIRUFHPHQWFRUURVLRQ 
,Q 6HFWLRQ  WKH EDVLF SULQFLSOHV RI WKH ILQDO HOHFWURFKHPLFDO WHVW VHWXS DQG WKH ,Q 6HFWLRQ  WKH EDVLF SULQFLSOHV RI WKH ILQDO HOHFWURFKHPLFDO WHVW VHWXS DQG WKH
PRVW LPSRUWDQW IHDWXUHV RI WKH DSSOLHG VSHFLPHQV DUH VXPPDULVHG 7KH UHOHYDQW SD PRVW LPSRUWDQW IHDWXUHV RI WKH DSSOLHG VSHFLPHQV DUH VXPPDULVHG 7KH UHOHYDQW SD
UDPHWHUVFRQFHUQLQJWKHPDWHULDOVXVHGIRUWKHWHVWVSHFLPHQVDQGWKHH[SRVXUHFRQGL UDPHWHUVFRQFHUQLQJWKHPDWHULDOVXVHGIRUWKHWHVWVSHFLPHQVDQGWKHH[SRVXUHFRQGL
WLRQV DUH JLYHQ LQ 6HFWLRQ  7KLV LQIRUPDWLRQ LQ FRPELQDWLRQ ZLWK D EULHI RYHU WLRQV DUH JLYHQ LQ 6HFWLRQ  7KLV LQIRUPDWLRQ LQ FRPELQDWLRQ ZLWK D EULHI RYHU
YLHZRIWKHPDLQSDUDPHWHUVRIWZRLQYHVWLJDWLRQV 6HFWLRQVDQG SURYLGHV YLHZRIWKHPDLQSDUDPHWHUVRIWZRLQYHVWLJDWLRQV 6HFWLRQVDQG SURYLGHV
WKH FHQWUDO LQIRUPDWLRQ IRU WKH H[SHULPHQWDO REVHUYDWLRQV DQG UHVXOWV PHQWLRQHG DQG WKH FHQWUDO LQIRUPDWLRQ IRU WKH H[SHULPHQWDO REVHUYDWLRQV DQG UHVXOWV PHQWLRQHG DQG
UHIHUUHGWRWKURXJKRXWWKLVWKHVLV UHIHUUHGWRWKURXJKRXWWKLVWKHVLV
7KHH[SHULPHQWDOLQYHVWLJDWLRQVLQFOXGHGLQWKLVWKHVLVGHDOWZLWK 7KHH[SHULPHQWDOLQYHVWLJDWLRQVLQFOXGHGLQWKLVWKHVLVGHDOWZLWK
‡ 7KHWKHUPRG\QDPLFSURSHUWLHVRIGLIIHUHQWVWHHOTXDOLWLHVDQGFDUERQVWHHOVXUIDFH ‡ 7KHWKHUPRG\QDPLFSURSHUWLHVRIGLIIHUHQWVWHHOTXDOLWLHVDQGFDUERQVWHHOVXUIDFH
WUHDWPHQWVHPEHGGHGLQPRUWDU KHQFHIRUWKµ7HVW,¶  6HFWLRQ  WUHDWPHQWVHPEHGGHGLQPRUWDU KHQFHIRUWKµ7HVW,¶  6HFWLRQ 
‡ 7KHWKHUPRG\QDPLFSURSHUWLHVRIGLIIHUHQWVWHHOTXDOLWLHVDQGFDUERQVWHHOVXUIDFH ‡ 7KHWKHUPRG\QDPLFSURSHUWLHVRIGLIIHUHQWVWHHOTXDOLWLHVDQGFDUERQVWHHOVXUIDFH
PRGLILFDWLRQV LQFOXGLQJ WKH ILUVW LPSOHPHQWDWLRQV RI WKH SURSRVHG QHZ FRXQWHU PRGLILFDWLRQV LQFOXGLQJ WKH ILUVW LPSOHPHQWDWLRQV RI WKH SURSRVHG QHZ FRXQWHU
PHDVXUHV HPEHGGHGLQPRUWDUDQGLQFHPHQWSDVWH KHQFHIRUWKµ7HVW,,¶  6HFWLRQ PHDVXUHV HPEHGGHGLQPRUWDUDQGLQFHPHQWSDVWH KHQFHIRUWKµ7HVW,,¶  6HFWLRQ
   
,QFRUUHVSRQGHQFHZLWKWKHSURSRVHGGHVLJQPHWKRGRORJ\IRUFRUURVLRQFRXQWHUPHD ,QFRUUHVSRQGHQFHZLWKWKHSURSRVHGGHVLJQPHWKRGRORJ\IRUFRUURVLRQFRXQWHUPHD
VXUHV DQG WKH VWDJHV RI FRQFHUQ LQ WKLV SURMHFW FI )LJXUH  LQ 6HFWLRQ   VPDOO VXUHV DQG WKH VWDJHV RI FRQFHUQ LQ WKLV SURMHFW FI )LJXUH  LQ 6HFWLRQ   VPDOO
VFDOHVDPSOHVDQGDFFHOHUDWLQJFRQGLWLRQVZHUHXVHGIRUDOOH[SHULPHQWV'XHWRDVVR VFDOHVDPSOHVDQGDFFHOHUDWLQJFRQGLWLRQVZHUHXVHGIRUDOOH[SHULPHQWV'XHWRDVVR
FLDWHG VL]H OLPLWDWLRQVDQGLQRUGHUWRHOLPLQDWHXQGHVLUDEOHLQIOXHQFHVRQWKHPHDV FLDWHG VL]H OLPLWDWLRQVDQGLQRUGHUWRHOLPLQDWHXQGHVLUDEOHLQIOXHQFHVRQWKHPHDV
XUHPHQWVPRUWDUDQGFHPHQWSDVWHZHUHXVHGLQVWHDGRIFRQFUHWHGXULQJDOOH[SHUL XUHPHQWVPRUWDUDQGFHPHQWSDVWHZHUHXVHGLQVWHDGRIFRQFUHWHGXULQJDOOH[SHUL
PHQWDOLQYHVWLJDWLRQV PHQWDOLQYHVWLJDWLRQV

 7HVW6HWXSDQG(OHFWURFKHPLFDO0HDVXUHPHQWV  7HVW6HWXSDQG(OHFWURFKHPLFDO0HDVXUHPHQWV


$ FHQWUDOSDUW RI WKHSURMHFW ZDV WKH GHYHORSPHQW RI D WHVW VHWXSIRUFRPSUHKHQVLYH $ FHQWUDOSDUW RI WKHSURMHFW ZDV WKH GHYHORSPHQW RI D WHVW VHWXSIRUFRPSUHKHQVLYH
PRQLWRULQJ RI PXOWLSOH WHVW VSHFLPHQV ,QVWUXPHQWHG VSHFLPHQV IRU H[WHQVLYHWHVWLQJ PRQLWRULQJ RI PXOWLSOH WHVW VSHFLPHQV ,QVWUXPHQWHG VSHFLPHQV IRU H[WHQVLYHWHVWLQJ
DVZHOODVVLPSOHVSHFLPHQVWKDWDOORZHGIRUPDVVSURGXFWLRQZHUHWHVWHGRQDKLJK DVZHOODVVLPSOHVSHFLPHQVWKDWDOORZHGIRUPDVVSURGXFWLRQZHUHWHVWHGRQDKLJK
FDSDFLW\H[SRVXUHVHWXSE\PHDQVRIDQDXWRPDWHGPRQLWRULQJV\VWHP FDSDFLW\H[SRVXUHVHWXSE\PHDQVRIDQDXWRPDWHGPRQLWRULQJV\VWHP

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


,QWURGXFWLRQ 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV ,QWURGXFWLRQ 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV

,QDOOH[SHULPHQWVIRFXVZDVVHWRQFKORULGHLQGXFHGFRUURVLRQZKHUHDVWKHUHVLVWDQFH ,QDOOH[SHULPHQWVIRFXVZDVVHWRQFKORULGHLQGXFHGFRUURVLRQZKHUHDVWKHUHVLVWDQFH
RIDYDLODEOHDQGWKHSURSRVHGQHZFRXQWHUPHDVXUHVWRFDUERQDWLRQLQGXFHGFRUURVLRQ RIDYDLODEOHDQGWKHSURSRVHGQHZFRXQWHUPHDVXUHVWRFDUERQDWLRQLQGXFHGFRUURVLRQ
ZDVWUHDWHGWKHRUHWLFDOO\RQO\(OHFWURFKHPLFDOWHVWVZHUHPDLQO\EDVHGRQFRPELQHG ZDVWUHDWHGWKHRUHWLFDOO\RQO\(OHFWURFKHPLFDOWHVWVZHUHPDLQO\EDVHGRQFRPELQHG
PRQLWRULQJRIWKHFRUURVLRQSRWHQWLDOµ(FRUU¶DQGWKHPDFURFHOOFXUUHQWµLPDF¶DVZHOODV PRQLWRULQJRIWKHFRUURVLRQSRWHQWLDOµ(FRUU¶DQGWKHPDFURFHOOFXUUHQWµLPDF¶DVZHOODV
RQ HOHFWURFKHPLFDO LPSHGDQFH VSHFWURVFRS\ µ(,6¶ DQG SRODULVDWLRQ FXUYH PHDVXUH RQ HOHFWURFKHPLFDO LPSHGDQFH VSHFWURVFRS\ µ(,6¶ DQG SRODULVDWLRQ FXUYH PHDVXUH
PHQWV FI6HFWLRQVDQG 7KHFRQFHSWIRUFRPSUHKHQVLYHµ(FRUU¶DQGµLPDF¶ PHQWV FI6HFWLRQVDQG 7KHFRQFHSWIRUFRPSUHKHQVLYHµ(FRUU¶DQGµLPDF¶
PRQLWRULQJ LV H[HPSOLILHG LQ )LJXUH  EDVHG RQ RQH VHW RI DQ LQVWUXPHQWHG PRUWDU PRQLWRULQJ LV H[HPSOLILHG LQ )LJXUH  EDVHG RQ RQH VHW RI DQ LQVWUXPHQWHG PRUWDU
VSHFLPHQDQGLWVDVVRFLDWHGH[WHUQDOFDWKRGHµ(&DW¶ VSHFLPHQDQGLWVDVVRFLDWHGH[WHUQDOFDWKRGHµ(&DW¶

 
)LJXUH >$@ ,GHDOLVHG WHVW VHWXS VKRZLQJ RQH VHW RI LQVWUXPHQWHG PRUWDU )LJXUH >$@ ,GHDOLVHG WHVW VHWXS VKRZLQJ RQH VHW RI LQVWUXPHQWHG PRUWDU
VSHFLPHQ DQG DHUDWHG H[WHUQDO FDWKRGH DQG WKH PRQLWRUHG VLJQDOV VSHFLPHQ DQG DHUDWHG H[WHUQDO FDWKRGH DQG WKH PRQLWRUHG VLJQDOV
µ+¶ KLJKWHUPLQDODQG µ/¶ ORZWHUPLQDO RIGDWDORJJHU  µ$¶ DQ µ+¶ KLJKWHUPLQDODQG µ/¶ ORZWHUPLQDO RIGDWDORJJHU  µ$¶ DQ
RGH DQG µ&¶  FDWKRGH FRQQHFWLRQ IRU PDFURFHOO FXUUHQW PRQLWRULQJ RGH DQG µ&¶  FDWKRGH FRQQHFWLRQ IRU PDFURFHOO FXUUHQW PRQLWRULQJ
µ(&DW¶H[WHUQDOFDWKRGHDQGµ6&(¶VDWXUDWHGFDORPHOHOHFWURGH>%@ µ(&DW¶H[WHUQDOFDWKRGHDQGµ6&(¶VDWXUDWHGFDORPHOHOHFWURGH>%@
7RS YLHZ RI LQVWUXPHQWHG PRUWDU VSHFLPHQ ZLWK LGHQWLILFDWLRQ RI HP 7RS YLHZ RI LQVWUXPHQWHG PRUWDU VSHFLPHQ ZLWK LGHQWLILFDWLRQ RI HP
EHGGHGHOHFWURGHZLUHVµ((:V¶>&@$V>%@ZLWKLOOXVWUDWLRQRIXVLQJ EHGGHGHOHFWURGHZLUHVµ((:V¶>&@$V>%@ZLWKLOOXVWUDWLRQRIXVLQJ
µ((:V¶ DV HOHFWURGHV IRU HOHFWURFKHPLFDO LPSHGDQFH VSHFWURVFRS\ µ((:V¶ DV HOHFWURGHV IRU HOHFWURFKHPLFDO LPSHGDQFH VSHFWURVFRS\
µ(,6¶ µ:(¶ ZRUNLQJ HOHFWURGH µ5(¶ UHIHUHQFH HOHFWURGH DQG µ&(¶ µ(,6¶ µ:(¶ ZRUNLQJ HOHFWURGH µ5(¶ UHIHUHQFH HOHFWURGH DQG µ&(¶
FRXQWHU HOHFWURGH $SDUW IURP WKH µ((:V¶ WKH FRORXUV XVHG IRU WKH FRXQWHU HOHFWURGH $SDUW IURP WKH µ((:V¶ WKH FRORXUV XVHG IRU WKH
FRQQHFWLRQVDJUHHZLWKWKHFRORXUFRGHXVHGLQ6HFWLRQ FRQQHFWLRQVDJUHHZLWKWKHFRORXUFRGHXVHGLQ6HFWLRQ
$VLQGLFDWHGLQ)LJXUH>$@DQG>%@HLJKWVLJQDOVIURPHDFKLQVWUXPHQWHGPRUWDU $VLQGLFDWHGLQ)LJXUH>$@DQG>%@HLJKWVLJQDOVIURPHDFKLQVWUXPHQWHGPRUWDU
VSHFLPHQ ZHUH UHFRUGHG GXULQJ ORQJWHUP H[SRVXUH :KHQ WKH PDFURFHOO ZDV DFWL VSHFLPHQ ZHUH UHFRUGHG GXULQJ ORQJWHUP H[SRVXUH :KHQ WKH PDFURFHOO ZDV DFWL
YDWHGLHWKHUHEDUZDVFRQQHFWHGWRWKHDHUDWHGµ(&DW¶WKHFXUUHQWIORZLQJEHWZHHQ YDWHGLHWKHUHEDUZDVFRQQHFWHGWRWKHDHUDWHGµ(&DW¶WKHFXUUHQWIORZLQJEHWZHHQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV ,QWURGXFWLRQ 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV ,QWURGXFWLRQ

WKHUHEDUDQGWKHFDWKRGHµLPDF¶ ZDV DOVR PRQLWRUHG 7KH DVVRFLDWHG VLJQDOV ZHUH GL WKHUHEDUDQGWKHFDWKRGHµLPDF¶ ZDV DOVR PRQLWRUHG 7KH DVVRFLDWHG VLJQDOV ZHUH GL
YHUWHG LQWR  PRQLWRULQJ FKDQQHOV 7KHVH FRPSULVHG WKH µLPDF¶ UHDGLQJ WZR WLPHV YHUWHG LQWR  PRQLWRULQJ FKDQQHOV 7KHVH FRPSULVHG WKH µLPDF¶ UHDGLQJ WZR WLPHV
HLJKW VLJQDOV UHEDU µ(&DW¶ DQG WKH VL[ HPEHGGHG HOHFWURGH ZLUHV µ((:V¶  DJDLQVW HLJKW VLJQDOV UHEDU µ(&DW¶ DQG WKH VL[ HPEHGGHG HOHFWURGH ZLUHV µ((:V¶  DJDLQVW
WKH WZR VKDUHG VDWXUDWHG FDORPHO HOHFWURGHV µ6&(V¶ DV ZHOO DV WKH VLJQDOV IURP WKH WKH WZR VKDUHG VDWXUDWHG FDORPHO HOHFWURGHV µ6&(V¶ DV ZHOO DV WKH VLJQDOV IURP WKH
µ(&DW¶DQGµ((:V¶DJDLQVWWKHUHEDU0RUHRYHUWKHµ((:V¶FRXOGDFWDVERWKUHIHU µ(&DW¶DQGµ((:V¶DJDLQVWWKHUHEDU0RUHRYHUWKHµ((:V¶FRXOGDFWDVERWKUHIHU
HQFH HOHFWURGH µ5(¶ DQG FRXQWHU HOHFWURGH µ&(¶ GXULQJ µ(,6¶ WKH UHEDU UHSUHVHQWHG HQFH HOHFWURGH µ5(¶ DQG FRXQWHU HOHFWURGH µ&(¶ GXULQJ µ(,6¶ WKH UHEDU UHSUHVHQWHG
WKH ZRUNLQJ HOHFWURGH µ:(¶ VHH )LJXUH  >&@ ,Q WKH VWDQGDUG OD\RXW ERWK WKH WKH ZRUNLQJ HOHFWURGH µ:(¶ VHH )LJXUH  >&@ ,Q WKH VWDQGDUG OD\RXW ERWK WKH
µ(&DW¶DQGWKHµ((:V¶FRQVLVWHGRI5X,UPL[HGPHWDOR[LGH µ002¶ DFWLYDWHGWLWD µ(&DW¶DQGWKHµ((:V¶FRQVLVWHGRI5X,UPL[HGPHWDOR[LGH µ002¶ DFWLYDWHGWLWD
QLXP FI6HFWLRQ  QLXP FI6HFWLRQ 
µ(FRUU¶DQGµLPDF¶PRQLWRULQJZDVDXWRPDWHGDQGXQGHUWDNHQE\PHDQVRIFOXVWHUPHDV µ(FRUU¶DQGµLPDF¶PRQLWRULQJZDVDXWRPDWHGDQGXQGHUWDNHQE\PHDQVRIFOXVWHUPHDV
XUHPHQWV &OXVWHU PHDVXUHPHQWV PDGH LW SRVVLEOH WR PRQLWRU PXOWLSOH VSHFLPHQV E\ XUHPHQWV &OXVWHU PHDVXUHPHQWV PDGH LW SRVVLEOH WR PRQLWRU PXOWLSOH VSHFLPHQV E\
VXEGLYLGLQJWKHWHVWEDWFKLQWRFOXVWHUVZKLFKZHUHPHDVXUHGRQHDIWHUWKHRWKHU ,Q VXEGLYLGLQJWKHWHVWEDWFKLQWRFOXVWHUVZKLFKZHUHPHDVXUHGRQHDIWHUWKHRWKHU ,Q
WKHILQDOFRQILJXUDWLRQLQVWUXPHQWHGPRUWDUVSHFLPHQVFRXOGEHPRQLWRUHGZLWK WKHILQDOFRQILJXUDWLRQLQVWUXPHQWHGPRUWDUVSHFLPHQVFRXOGEHPRQLWRUHGZLWK
FKDQQHOVHDFK$VWDQGDUGSOXJFRQQHFWHGWRHDFKLQVWUXPHQWHGPRUWDUVSHFLPHQJDYH FKDQQHOVHDFK$VWDQGDUGSOXJFRQQHFWHGWRHDFKLQVWUXPHQWHGPRUWDUVSHFLPHQJDYH
WKHRSWLRQRIDGGLWLRQDOHOHFWURFKHPLFDOPHWKRGVIRUFRUURVLRQWHVWLQJ7KLVVWDQGDUG WKHRSWLRQRIDGGLWLRQDOHOHFWURFKHPLFDOPHWKRGVIRUFRUURVLRQWHVWLQJ7KLVVWDQGDUG
SOXJFRQQHFWLRQZDVSULPDU\XVHGIRUµ(,6¶EXWFRXOGEHHDVLO\DGDSWHGWRSRODULVD SOXJFRQQHFWLRQZDVSULPDU\XVHGIRUµ(,6¶EXWFRXOGEHHDVLO\DGDSWHGWRSRODULVD
WLRQ FXUYH PHDVXUHPHQWV RU RWKHU SRWHQWLRVWDWLF PHWKRGV DV ZHOO DV FRQGXFWLYLW\ WLRQ FXUYH PHDVXUHPHQWV RU RWKHU SRWHQWLRVWDWLF PHWKRGV DV ZHOO DV FRQGXFWLYLW\
PHDVXUHPHQWV EHWZHHQ GLIIHUHQW µ((:V¶ DQGRU WKH UHEDU 7KH PRQLWRULQJ FRQFHSW PHDVXUHPHQWV EHWZHHQ GLIIHUHQW µ((:V¶ DQGRU WKH UHEDU 7KH PRQLWRULQJ FRQFHSW
DQG WKH LPSOHPHQWDWLRQ RI WKH SULQFLSDO HOHFWURFKHPLFDO PHDVXUHPHQW PHWKRGV DUH DQG WKH LPSOHPHQWDWLRQ RI WKH SULQFLSDO HOHFWURFKHPLFDO PHDVXUHPHQW PHWKRGV DUH
GHVFULEHGLQGHWDLOLQ6HFWLRQVDQGUHVSHFWLYHO\ GHVFULEHGLQGHWDLOLQ6HFWLRQVDQGUHVSHFWLYHO\
,QDGGLWLRQWRWKHLQVWUXPHQWHGPRUWDUVSHFLPHQWZRVLPSOHVSHFLPHQGHVLJQVZHUH ,QDGGLWLRQWRWKHLQVWUXPHQWHGPRUWDUVSHFLPHQWZRVLPSOHVSHFLPHQGHVLJQVZHUH
XVHG DV UHIHUHQFH VSHFLPHQV IRU HOHFWURFKHPLFDO PHDVXUHPHQWV ZKLFK DLPHG DW WKH XVHG DV UHIHUHQFH VSHFLPHQV IRU HOHFWURFKHPLFDO PHDVXUHPHQWV ZKLFK DLPHG DW WKH
DVVHVVPHQWRIWKHWKHUPRG\QDPLFVWDWHRIWKHUHEDURQO\ DVVHVVPHQWRIWKHWKHUPRG\QDPLFVWDWHRIWKHUHEDURQO\
‡ 6LPSOHPRUWDUVSHFLPHQ ‡ 6LPSOHPRUWDUVSHFLPHQ
7KH VLPSOH PRUWDU VSHFLPHQ ZDV EDVHG RQ WKH VDPH OD\RXW DV WKH LQVWUXPHQWHG 7KH VLPSOH PRUWDU VSHFLPHQ ZDV EDVHG RQ WKH VDPH OD\RXW DV WKH LQVWUXPHQWHG
PRUWDUVSHFLPHQEXWZLWKRXWµ((:V¶$SKRWRJUDSKRIDµ7HVW,,¶VLPSOHPRUWDU PRUWDUVSHFLPHQEXWZLWKRXWµ((:V¶$SKRWRJUDSKRIDµ7HVW,,¶VLPSOHPRUWDU
VSHFLPHQDWWKHHQGRILWVH[SRVXUHSHULRGLVVKRZQLQ)LJXUH>$@LQ6HFWLRQ VSHFLPHQDWWKHHQGRILWVH[SRVXUHSHULRGLVVKRZQLQ)LJXUH>$@LQ6HFWLRQ
 
‡ &HPHQWSDVWHVSHFLPHQV ‡ &HPHQWSDVWHVSHFLPHQV
7KHFHPHQWSDVWHVSHFLPHQZDVEDVHGRQDUHEDUZLWKWKHVDPHGLDPHWHUDQGH[ 7KHFHPHQWSDVWHVSHFLPHQZDVEDVHGRQDUHEDUZLWKWKHVDPHGLDPHWHUDQGH[
SRVXUH DUHD DV WKH PRUWDU VSHFLPHQV EXW WKH UHEDU ZDV GLSFRDWHG ZLWK FHPHQW SRVXUH DUHD DV WKH PRUWDU VSHFLPHQV EXW WKH UHEDU ZDV GLSFRDWHG ZLWK FHPHQW
SDVWH LQVWHDG RI FDVW LQWR PRUWDU 7KH SURGXFWLRQ SURFHVV RI WKH FHPHQW SDVWH SDVWH LQVWHDG RI FDVW LQWR PRUWDU 7KH SURGXFWLRQ SURFHVV RI WKH FHPHQW SDVWH
VSHFLPHQDOORZHGIRUPDVVSURGXFWLRQ VSHFLPHQDOORZHGIRUPDVVSURGXFWLRQ
7KHVLPSOHPRUWDUDQGWKHFHPHQWSDVWHVSHFLPHQZHUHPRQLWRUHGLQWKHVDPHZD\DV 7KHVLPSOHPRUWDUDQGWKHFHPHQWSDVWHVSHFLPHQZHUHPRQLWRUHGLQWKHVDPHZD\DV
WKH LQVWUXPHQWHG PRUWDU VSHFLPHQ EXW OHDYLQJ RXW WKH µ((:¶ FRQQHFWLRQV 7KH XQ WKH LQVWUXPHQWHG PRUWDU VSHFLPHQ EXW OHDYLQJ RXW WKH µ((:¶ FRQQHFWLRQV 7KH XQ
XVHG µ((:¶ FRQQHFWLRQV FRXOG EH DSSOLHG IRU µ(FRUU¶ PRQLWRULQJ RI DGGLWLRQDO VSHFL XVHG µ((:¶ FRQQHFWLRQV FRXOG EH DSSOLHG IRU µ(FRUU¶ PRQLWRULQJ RI DGGLWLRQDO VSHFL
PHQV $PRQJ RWKHUV WKHVH FRQQHFWLRQV ZHUH XVHG IRU µ(FRUU¶ PRQLWRULQJ RI VXSSOH PHQV $PRQJ RWKHUV WKHVH FRQQHFWLRQV ZHUH XVHG IRU µ(FRUU¶ PRQLWRULQJ RI VXSSOH
PHQWDU\ FHPHQWSDVWHVSHFLPHQV<HWWKHPDMRUSDUWRIWKHFHPHQWSDVWHVSHFLPHQV PHQWDU\ FHPHQWSDVWHVSHFLPHQV<HWWKHPDMRUSDUWRIWKHFHPHQWSDVWHVSHFLPHQV
ZDVXVHGIRUGHVWUXFWLYHPHDVXUHPHQWVPDLQO\IXOOVFDOHDQRGLFSRODULVDWLRQ ZDVXVHGIRUGHVWUXFWLYHPHDVXUHPHQWVPDLQO\IXOOVFDOHDQRGLFSRODULVDWLRQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


,QWURGXFWLRQ 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV ,QWURGXFWLRQ 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV

7KH PDQXIDFWXUH DQG WKH VSHFLDO IHDWXUHV RI WKHVH WKUHH W\SHV RI VSHFLPHQV LH WKH 7KH PDQXIDFWXUH DQG WKH VSHFLDO IHDWXUHV RI WKHVH WKUHH W\SHV RI VSHFLPHQV LH WKH
LQVWUXPHQWHGDQGWKHVLPSOHPRUWDUVSHFLPHQDVZHOODVWKHFHPHQWSDVWHVSHFLPHQ LQVWUXPHQWHGDQGWKHVLPSOHPRUWDUVSHFLPHQDVZHOODVWKHFHPHQWSDVWHVSHFLPHQ
DUH GHVFULEHG LQ GHWDLO LQ 6HFWLRQ  %HVLGHV WKHVH VSHFLPHQ W\SHV ZKLFK HVWDE DUH GHVFULEHG LQ GHWDLO LQ 6HFWLRQ  %HVLGHV WKHVH VSHFLPHQ W\SHV ZKLFK HVWDE
OLVKHGWKHSULQFLSDOSDUWRIWKHWHVWEDWFKHVIRUDOOWHVWVHULHVDQXPEHURIRWKHUVSHFL OLVKHGWKHSULQFLSDOSDUWRIWKHWHVWEDWFKHVIRUDOOWHVWVHULHVDQXPEHURIRWKHUVSHFL
PHQ OD\RXWV ZHUH XVHG IRU VXSSOHPHQWDU\ PHDVXUHPHQWV $PRQJ RWKHUV WKHVH LQ PHQ OD\RXWV ZHUH XVHG IRU VXSSOHPHQWDU\ PHDVXUHPHQWV $PRQJ RWKHUV WKHVH LQ
FOXGHGLQVWUXPHQWHGPRUWDUVSHFLPHQVZLWKFDUERQVWHHOµ((:V¶WKDWHQDEOHGPRQL FOXGHGLQVWUXPHQWHGPRUWDUVSHFLPHQVZLWKFDUERQVWHHOµ((:V¶WKDWHQDEOHGPRQL
WRULQJRIWKHFKORULGHLQJUHVVLQVWUXPHQWHGPRUWDUVSHFLPHQVZLWKRXWUHEDUWKDWZHUH WRULQJRIWKHFKORULGHLQJUHVVLQVWUXPHQWHGPRUWDUVSHFLPHQVZLWKRXWUHEDUWKDWZHUH
XVHGDVDUHIHUHQFHIRUPRQLWRULQJWKHµ(FRUU¶RIWKHDFWLYDWHGWLWDQLXPZLUHDVZHOODV XVHGDVDUHIHUHQFHIRUPRQLWRULQJWKHµ(FRUU¶RIWKHDFWLYDWHGWLWDQLXPZLUHDVZHOODV
SODLQPRUWDUVSHFLPHQV VLPSOHPRUWDUVSHFLPHQVZLWKRXWUHEDU WKDWZHUHXVHGDVD SODLQPRUWDUVSHFLPHQV VLPSOHPRUWDUVSHFLPHQVZLWKRXWUHEDU WKDWZHUHXVHGDVD
UHIHUHQFHIRUFKHPLFDODQDO\VLVHJIRUWHVWLQJRIPRUWDUS+ FI6HFWLRQVDQG UHIHUHQFHIRUFKHPLFDODQDO\VLVHJIRUWHVWLQJRIPRUWDUS+ FI6HFWLRQVDQG
 DQGFKORULGHLQJUHVV FI6HFWLRQ   DQGFKORULGHLQJUHVV FI6HFWLRQ 
%DVHGRQWKHDERYHGHVFULEHGVSHFLPHQOD\RXWVDQGDWRWDORI × FKDQQHOV %DVHGRQWKHDERYHGHVFULEHGVSHFLPHQOD\RXWVDQGDWRWDORI × FKDQQHOV
DYDLODEOH IRU PRQLWRULQJ DOWRJHWKHU  VSHFLPHQV ZHUH PRQLWRUHG DW D WLPH LQ WZR DYDLODEOH IRU PRQLWRULQJ DOWRJHWKHU  VSHFLPHQV ZHUH PRQLWRUHG DW D WLPH LQ WZR
H[SRVXUHFRQWDLQHUVLQWKHILQDOFRQILJXUDWLRQRIWKHH[SHULPHQWDOVHWXSVSHFLPHQV H[SRVXUHFRQWDLQHUVLQWKHILQDOFRQILJXUDWLRQRIWKHH[SHULPHQWDOVHWXSVSHFLPHQV
LQ FKORULGH VROXWLRQ DQG  VSHFLPHQV LQ SRWDEOH ZDWHU FI 6HFWLRQV  DQG   LQ FKORULGH VROXWLRQ DQG  VSHFLPHQV LQ SRWDEOH ZDWHU FI 6HFWLRQV  DQG  
)RU H[HPSOLILFDWLRQSXUSRVHV WKH DUUDQJHPHQW RI VSHFLPHQV LQWKHFKORULGHVROXWLRQ )RU H[HPSOLILFDWLRQSXUSRVHV WKH DUUDQJHPHQW RI VSHFLPHQV LQWKHFKORULGHVROXWLRQ
H[SRVXUHFRQWDLQHUXVHGGXULQJµ7HVW,,¶LVVKRZQLQ)LJXUH H[SRVXUHFRQWDLQHUXVHGGXULQJµ7HVW,,¶LVVKRZQLQ)LJXUH

 
)LJXUH ([HPSOLILFDWLRQRIWKHDUUDQJHPHQWRIVSHFLPHQVWHVWHGLQWKHFKORULGH )LJXUH ([HPSOLILFDWLRQRIWKHDUUDQJHPHQWRIVSHFLPHQVWHVWHGLQWKHFKORULGH
H[SRVXUH VHWXS IRU WKH FRQFOXGLQJ H[SHULPHQWV FI 6HFWLRQ   H[SRVXUH VHWXS IRU WKH FRQFOXGLQJ H[SHULPHQWV FI 6HFWLRQ  
µ(&DW¶H[WHUQDOFDWKRGH µ(&DW¶H[WHUQDOFDWKRGH

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV ,QWURGXFWLRQ 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV ,QWURGXFWLRQ

7KH UHIHUHQFH FRQWDLQHU IRU H[SRVXUH LQ SRWDEOH ZDWHU LV SUHVHQWHG LQ )LJXUH  LQ 7KH UHIHUHQFH FRQWDLQHU IRU H[SRVXUH LQ SRWDEOH ZDWHU LV SUHVHQWHG LQ )LJXUH  LQ
6HFWLRQ7KHHTXLSPHQWRIWKHH[SRVXUHFRQWDLQHUVZKLFKLVDOVRVKRZQLQ)LJXUH 6HFWLRQ7KHHTXLSPHQWRIWKHH[SRVXUHFRQWDLQHUVZKLFKLVDOVRVKRZQLQ)LJXUH
LVGHVFULEHGLQFRQQHFWLRQZLWK)LJXUHLQ6HFWLRQ LVGHVFULEHGLQFRQQHFWLRQZLWK)LJXUHLQ6HFWLRQ

 0DWHULDOVDQG([SRVXUH&RQGLWLRQV  0DWHULDOVDQG([SRVXUH&RQGLWLRQV


,QWKLV6HFWLRQWKHPRVWLPSRUWDQWPDWHULDOVSURSHUWLHVLHSURSHUWLHVFRQFHUQLQJFRU ,QWKLV6HFWLRQWKHPRVWLPSRUWDQWPDWHULDOVSURSHUWLHVLHSURSHUWLHVFRQFHUQLQJFRU
URVLRQSHUIRUPDQFHRIWKHVSHFLPHQVWHVWHGLQµ7HVW,¶ FI6HFWLRQ DQGµ7HVW,,¶ URVLRQSHUIRUPDQFHRIWKHVSHFLPHQVWHVWHGLQµ7HVW,¶ FI6HFWLRQ DQGµ7HVW,,¶
FI 6HFWLRQ   DV ZHOO DV WKH H[SRVXUH FRQGLWLRQV DSSOLHG LQ WKHVH H[SHULPHQWDO FI 6HFWLRQ   DV ZHOO DV WKH H[SRVXUH FRQGLWLRQV DSSOLHG LQ WKHVH H[SHULPHQWDO
LQYHVWLJDWLRQVDUHVXPPDULVHG LQYHVWLJDWLRQVDUHVXPPDULVHG
‡ &HPHQWDQGPL[LQJZDWHU ‡ &HPHQWDQGPL[LQJZDWHU
5DSLGKDUGHQLQJ3RUWODQGFHPHQW&(0,>'6(1@IURP$DOERUJ 5DSLGKDUGHQLQJ3RUWODQGFHPHQW&(0,>'6(1@IURP$DOERUJ
3RUWODQG  ZDV XVHG DV WKH VWDQGDUG FHPHQW LQ DOO H[SHULPHQWDO LQYHVWLJDWLRQV $ 3RUWODQG  ZDV XVHG DV WKH VWDQGDUG FHPHQW LQ DOO H[SHULPHQWDO LQYHVWLJDWLRQV $
FKHPLFDO DQDO\VLV RI WKH DSSOLHG FHPHQW W\SH LV JLYHQ LQ 7DEOH  LQ 6HFWLRQ FKHPLFDO DQDO\VLV RI WKH DSSOLHG FHPHQW W\SH LV JLYHQ LQ 7DEOH  LQ 6HFWLRQ
 6WDQGDUG SRWDEOH ZDWHU FRPSO\LQJ ZLWK >'6(1  @ ZDV XVHG DV  6WDQGDUG SRWDEOH ZDWHU FRPSO\LQJ ZLWK >'6(1  @ ZDV XVHG DV
PL[LQJZDWHUIRUDOOVSHFLPHQV PL[LQJZDWHUIRUDOOVSHFLPHQV
‡ 0RUWDUVSHFLPHQV ‡ 0RUWDUVSHFLPHQV
7ZRPRUWDUVFRPSRVLWLRQV $ DQG % ZHUHXVHG%RWKFRPSRVLWLRQVZHUHEDVHG 7ZRPRUWDUVFRPSRVLWLRQV $ DQG % ZHUHXVHG%RWKFRPSRVLWLRQVZHUHEDVHG
RQWKHVDPHZDWHUWRFHPHQWUDWLRµZF¶RIDQGZHLJKWE\ZHLJKWRIFH RQWKHVDPHZDWHUWRFHPHQWUDWLRµZF¶RIDQGZHLJKWE\ZHLJKWRIFH
PHQWµZZFH¶VXSHUSODVWLFLVHUZDVDGGHGWRERWKPL[HVWRLPSURYHWKHZRUNDELOLW\ PHQWµZZFH¶VXSHUSODVWLFLVHUZDVDGGHGWRERWKPL[HVWRLPSURYHWKHZRUNDELOLW\
'LIIHUHQWW\SHVRIVDQGFHPHQWWRVDQGUDWLRVDQGW\SHVRIVXSHUSODVWLFLVHUVZHUH 'LIIHUHQWW\SHVRIVDQGFHPHQWWRVDQGUDWLRVDQGW\SHVRIVXSHUSODVWLFLVHUVZHUH
XVHGIRUWKHWZRPRUWDUV XVHGIRUWKHWZRPRUWDUV
ƕ 0RUWDU $  ƕ 0RUWDU $ 
PPVDQGRIW\SH%HWRQVDQGNO$ FRQFUHWHVDQGFODVV$ ZLWKDFHPHQW PPVDQGRIW\SH%HWRQVDQGNO$ FRQFUHWHVDQGFODVV$ ZLWKDFHPHQW
WRVDQG UDWLR RI  3HUDPLQ ) IURP )RVURF‚ ZDV XVHG DV VXSHUSODVWLFLVHU WRVDQG UDWLR RI  3HUDPLQ ) IURP )RVURF‚ ZDV XVHG DV VXSHUSODVWLFLVHU
7KLV PRUWDU FRPSRVLWLRQ FRUUHVSRQGHG WR D PRUWDU XVHG LQ HDUOLHU LQYHVWLJD 7KLV PRUWDU FRPSRVLWLRQ FRUUHVSRQGHG WR D PRUWDU XVHG LQ HDUOLHU LQYHVWLJD
WLRQVDW'78%\J HJ>1LHOVHQ.WHU@  WLRQVDW'78%\J HJ>1LHOVHQ.WHU@ 
ƕ 0RUWDU %  ƕ 0RUWDU % 
PPVDQGRIW\SH6¡VDQGNO( VHDVDQGFODVV( ZLWKDFHPHQWWRVDQGUD PPVDQGRIW\SH6¡VDQGNO( VHDVDQGFODVV( ZLWKDFHPHQWWRVDQGUD
WLRRI9LVNRFUHWHIURP6LNDÁZDVXVHGDVVXSHUSODVWLFLVHU$SDUWIURP WLRRI9LVNRFUHWHIURP6LNDÁZDVXVHGDVVXSHUSODVWLFLVHU$SDUWIURP
WKHDGGLWLRQRIVXSHUSODVWLFLVHUWKLVFRPSRVLWLRQZDVEDVHGRQWKHSURSRUWLRQ WKHDGGLWLRQRIVXSHUSODVWLFLVHUWKLVFRPSRVLWLRQZDVEDVHGRQWKHSURSRUWLRQ
LQJVSHFLILHGLQ>'6(1@ LQJVSHFLILHGLQ>'6(1@

 

$DOERUJ3RUWODQG$6$DOERUJ'HQPDUN $DOERUJ3RUWODQG$6$DOERUJ'HQPDUN
‚ ‚
)RVURF$65¡GGLQJ'HQPDUN )RVURF$65¡GGLQJ'HQPDUN
Á Á
6LND'DQPDUN$6)UHGHQVERUJ'HQPDUN 6LND'DQPDUN$6)UHGHQVERUJ'HQPDUN

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


,QWURGXFWLRQ 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV ,QWURGXFWLRQ 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV

%RWKW\SHVRIVDQGFRPSOLHGZLWK>'6(1@VSHFLILFDWLRQVDQGZHUH %RWKW\SHVRIVDQGFRPSOLHGZLWK>'6(1@VSHFLILFDWLRQVDQGZHUH
REWDLQHGIURP6WHQ *UXV )RUµ7HVW,¶ERWKPRUWDUV $ DQG % ZHUHDSSOLHG REWDLQHGIURP6WHQ *UXV )RUµ7HVW,¶ERWKPRUWDUV $ DQG % ZHUHDSSOLHG
ZKLOHµ7HVW,,¶ZDVEDVHGRQPRUWDU % RQO\ ZKLOHµ7HVW,,¶ZDVEDVHGRQPRUWDU % RQO\
0L[LQJ RI WKH PRUWDU ZDV FRQGXFWHG LQ D +REDUW SODQHWDU\ PL[HU LQ DFFRUGDQFH 0L[LQJ RI WKH PRUWDU ZDV FRQGXFWHG LQ D +REDUW SODQHWDU\ PL[HU LQ DFFRUGDQFH
ZLWK >'6(1  @ 7ZR VSHFLPHQV LQVWUXPHQWHG SOXV VLPSOH RU SODLQ  ZLWK >'6(1  @ 7ZR VSHFLPHQV LQVWUXPHQWHG SOXV VLPSOH RU SODLQ 
DQGRQHPRUWDUF\OLQGHUZHUHFDVWDWWKHVDPHWLPH7KHVDPSOHVZHUHFRPSDFWHG DQGRQHPRUWDUF\OLQGHUZHUHFDVWDWWKHVDPHWLPH7KHVDPSOHVZHUHFRPSDFWHG
E\ YLEUDWLRQ LQ WKUHH VWHSV GXULQJ DQG DIWHU ILOOLQJ RI WKH PRXOGV FI 6HFWLRQ E\ YLEUDWLRQ LQ WKUHH VWHSV GXULQJ DQG DIWHU ILOOLQJ RI WKH PRXOGV FI 6HFWLRQ
 7KHVSHFLPHQVZHUHFXUHGYHUWLFDOO\LQWKHPRXOGVDWƒ&IRUKRXUV  7KHVSHFLPHQVZHUHFXUHGYHUWLFDOO\LQWKHPRXOGVDWƒ&IRUKRXUV
'XULQJWKH ILUVWKRXUVWKHVSHFLPHQVZHUHFXUHGWRSVLGHXSWKHQWKHERWWRP 'XULQJWKH ILUVWKRXUVWKHVSHFLPHQVZHUHFXUHGWRSVLGHXSWKHQWKHERWWRP
OLGZDVUHPRYHGIRUFDVWLQJRIWKHERWWRPOD\HURIHSR[\ FI6HFWLRQ DQG OLGZDVUHPRYHGIRUFDVWLQJRIWKHERWWRPOD\HURIHSR[\ FI6HFWLRQ DQG
WKHVSHFLPHQVZHUHFXUHGWRSVLGHGRZQIRUDQRWKHUKRXUVEHIRUHGHPRXOGLQJ WKHVSHFLPHQVZHUHFXUHGWRSVLGHGRZQIRUDQRWKHUKRXUVEHIRUHGHPRXOGLQJ
RQDSQHXPDWLFSUHVV7KHH[SRVXUHIRUERWKµ7HVW,¶DQGµ7HVW,,¶VWDUWHGGD\V RQDSQHXPDWLFSUHVV7KHH[SRVXUHIRUERWKµ7HVW,¶DQGµ7HVW,,¶VWDUWHGGD\V
DIWHUFDVWLQJEXWWKHWUHDWPHQWGXULQJWKHGD\VEHWZHHQGHPRXOGLQJDQGH[SR DIWHUFDVWLQJEXWWKHWUHDWPHQWGXULQJWKHGD\VEHWZHHQGHPRXOGLQJDQGH[SR
VXUHGLIIHUHGEHWZHHQWKHWZRWHVWEDWFKHV VXUHGLIIHUHGEHWZHHQWKHWZRWHVWEDWFKHV
ƕ 7UHDWPHQWEHWZHHQGHPRXOGLQJDQGH[SRVXUHRIµ7HVW,¶VSHFLPHQV ƕ 7UHDWPHQWEHWZHHQGHPRXOGLQJDQGH[SRVXUHRIµ7HVW,¶VSHFLPHQV
,PPHGLDWHO\DIWHUGHPRXOGLQJWKHVSHFLPHQVZHUHVHDOHGLQSODVWLFIRLO$IWHU ,PPHGLDWHO\DIWHUGHPRXOGLQJWKHVSHFLPHQVZHUHVHDOHGLQSODVWLFIRLO$IWHU
GD\VRIWUDQVSRUWDWLRQ IURP'78%\JWR1RUWKZHVWHUQ8QLYHUVLW\ ZLWKXQ GD\VRIWUDQVSRUWDWLRQ IURP'78%\JWR1RUWKZHVWHUQ8QLYHUVLW\ ZLWKXQ
NQRZQWHPSHUDWXUHFRQGLWLRQVWKHVHDOHGVSHFLPHQVZHUHVWRUHGDWDWHPSHUD NQRZQWHPSHUDWXUHFRQGLWLRQVWKHVHDOHGVSHFLPHQVZHUHVWRUHGDWDWHPSHUD
WXUHRIƒ&±ƒ& WXUHRIƒ&±ƒ&
ƕ 7UHDWPHQWEHWZHHQGHPRXOGLQJDQGH[SRVXUHRIµ7HVW,,¶VSHFLPHQV ƕ 7UHDWPHQWEHWZHHQGHPRXOGLQJDQGH[SRVXUHRIµ7HVW,,¶VSHFLPHQV
7KH VSHFLPHQV ZHUH VWRUHG XQVHDOHG LQ D FRQWUROOHG LQGRRU FOLPDWHDWDWHP 7KH VSHFLPHQV ZHUH VWRUHG XQVHDOHG LQ D FRQWUROOHG LQGRRU FOLPDWHDWDWHP
SHUDWXUHRIƒ&±ƒ&DQGDQDPELHQWUHODWLYHKXPLGLW\RI± SHUDWXUHRIƒ&±ƒ&DQGDQDPELHQWUHODWLYHKXPLGLW\RI±
‡ &HPHQWSDVWHVSHFLPHQV ‡ &HPHQWSDVWHVSHFLPHQV
7KHFHPHQWSDVWHVSHFLPHQVZHUHEDVHGRQFHPHQWSDVWHZLWKDµZF¶RI0L[ 7KHFHPHQWSDVWHVSHFLPHQVZHUHEDVHGRQFHPHQWSDVWHZLWKDµZF¶RI0L[
LQJRIWKHFHPHQWSDVWHZDVFRQGXFWHGLQDIRRGSURFHVVRU7KHVFKHGXOHVSHFLILHG LQJRIWKHFHPHQWSDVWHZDVFRQGXFWHGLQDIRRGSURFHVVRU7KHVFKHGXOHVSHFLILHG
LQ>'6(1@ZDVIROORZHGIRUWKHWLPLQJRIWKHPL[LQJPORIFH LQ>'6(1@ZDVIROORZHGIRUWKHWLPLQJRIWKHPL[LQJPORIFH
PHQWSDVWHZHUHPL[HGDWDWLPHWRGLSFRDWVL[VSHFLPHQV$IWHUGLSFRDWLQJWKH PHQWSDVWHZHUHPL[HGDWDWLPHWRGLSFRDWVL[VSHFLPHQV$IWHUGLSFRDWLQJWKH
FHPHQWSDVWHVSHFLPHQVZHUHPRXQWHGRQDVORZO\URWDWLQJVSLQQLQJZKHHOZKLOH FHPHQWSDVWHVSHFLPHQVZHUHPRXQWHGRQDVORZO\URWDWLQJVSLQQLQJZKHHOZKLOH
EHLQJVHDOHGLQSODVWLFERWWOHVDQGFXUHGIRUKRXUV FI)LJXUH>%@LQ6HF EHLQJVHDOHGLQSODVWLFERWWOHVDQGFXUHGIRUKRXUV FI)LJXUH>%@LQ6HF
WLRQ   'HSHQGLQJ RQ WKH VXUIDFH PRGLILFDWLRQ RI WKH UHEDU WKH FRDW WLRQ   'HSHQGLQJ RQ WKH VXUIDFH PRGLILFDWLRQ RI WKH UHEDU WKH FRDW
LQJFXULQJSURFHVVZDVSHUIRUPHGWZRWRWKUHHWLPHVZLWKDQDGHTXDWHQXPEHURI LQJFXULQJSURFHVVZDVSHUIRUPHGWZRWRWKUHHWLPHVZLWKDQDGHTXDWHQXPEHURI
GLSV WR DFKLHYH D WKLFNQHVV RI  “ PP RQ WKH H[SRVHG VXUIDFH ZKLFK ZDV GLSV WR DFKLHYH D WKLFNQHVV RI  “ PP RQ WKH H[SRVHG VXUIDFH ZKLFK ZDV
PHDVXUHGE\ PHDQV RI D YHUQLHU FDOOLSHU JDXJH :KHQ WKH GHVLUHG WKLFNQHVV ZDV PHDVXUHGE\ PHDQV RI D YHUQLHU FDOOLSHU JDXJH :KHQ WKH GHVLUHG WKLFNQHVV ZDV
DWWDLQHG DQG WKH VSHFLPHQV ZHUH KDUGHQHG WKH\ ZHUH PRLVW FXUHG LQ VDWXUDWHG DWWDLQHG DQG WKH VSHFLPHQV ZHUH KDUGHQHG WKH\ ZHUH PRLVW FXUHG LQ VDWXUDWHG
&D 2+ VROXWLRQ FI)LJXUH>&@LQ6HFWLRQ  &D 2+ VROXWLRQ FI)LJXUH>&@LQ6HFWLRQ 
&HPHQW SDVWH VSHFLPHQV ZHUH QRW XVHG LQ µ7HVW ,¶ 7KH µ7HVW ,,¶ FHPHQW SDVWH &HPHQW SDVWH VSHFLPHQV ZHUH QRW XVHG LQ µ7HVW ,¶ 7KH µ7HVW ,,¶ FHPHQW SDVWH
VSHFLPHQVIRUPRQLWRULQJZHUHH[SRVHGLQWKHFKORULGHDQGSRWDEOHZDWHUFRQWDLQ VSHFLPHQVIRUPRQLWRULQJZHUHH[SRVHGLQWKHFKORULGHDQGSRWDEOHZDWHUFRQWDLQ
 

6WHQ *UXV3U¡YHVWHQHQ$6&RSHQKDJHQ'HQPDUN 6WHQ *UXV3U¡YHVWHQHQ$6&RSHQKDJHQ'HQPDUN

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV ,QWURGXFWLRQ 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV ,QWURGXFWLRQ

HUV FI 6HFWLRQ    GD\V DIWHU WKH ILQDO GLSFRDWLQJ VSHFLPHQV ZLWK LQGLFHV HUV FI 6HFWLRQ    GD\V DIWHU WKH ILQDO GLSFRDWLQJ VSHFLPHQV ZLWK LQGLFHV
HQGLQJZLWK³&´DQG³'´FI6HFWLRQ 7KHµ7HVW,,¶FHPHQWSDVWHVSHFLPHQV HQGLQJZLWK³&´DQG³'´FI6HFWLRQ 7KHµ7HVW,,¶FHPHQWSDVWHVSHFLPHQV
IRU GHVWUXFWLYH PHDVXUHPHQWV LH IXOOVFDOH DQRGLF SRODULVDWLRQ FXUYHV ZHUH IRU GHVWUXFWLYH PHDVXUHPHQWV LH IXOOVFDOH DQRGLF SRODULVDWLRQ FXUYHV ZHUH
WHVWHGDWGLIIHUHQWWLPHLQWHUYDOVEXWZLWKDPLQLPXPDJHRIGD\VDIWHUWKHILQDO WHVWHGDWGLIIHUHQWWLPHLQWHUYDOVEXWZLWKDPLQLPXPDJHRIGD\VDIWHUWKHILQDO
GLSFRDWLQJ VSHFLPHQV ZLWK LQGLFHV HQGLQJ ZLWK ³(´ WR ³3´ FI 6HFWLRQ   GLSFRDWLQJ VSHFLPHQV ZLWK LQGLFHV HQGLQJ ZLWK ³(´ WR ³3´ FI 6HFWLRQ  
7KH VSHFLPHQ SURGXFWLRQ DQG WHVWLQJ ZDV VFKHGXOHG VR WKDW PHDVXUHPHQWV WKDW 7KH VSHFLPHQ SURGXFWLRQ DQG WHVWLQJ ZDV VFKHGXOHG VR WKDW PHDVXUHPHQWV WKDW
ZHUH WR EH FRPSDUHG HJ WR TXDQWLI\ WKH SHUIRUPDQFH RI GLIIHUHQW FRXQWHUPHD ZHUH WR EH FRPSDUHG HJ WR TXDQWLI\ WKH SHUIRUPDQFH RI GLIIHUHQW FRXQWHUPHD
VXUHV DW D FHUWDLQ H[SRVXUH WLPH ZHUH WDNHQ DW WKH VDPH FHPHQW SDVWH DJH DIWHU VXUHV DW D FHUWDLQ H[SRVXUH WLPH ZHUH WDNHQ DW WKH VDPH FHPHQW SDVWH DJH DIWHU
WKHILQDOGLSFRDWLQJ  WKHILQDOGLSFRDWLQJ 
‡ 5HLQIRUFLQJVWHHOTXDOLWLHV ‡ 5HLQIRUFLQJVWHHOTXDOLWLHV
)RUµ7HVW,¶ULEEHGUHEDUTXDOLWLHVZHUHXVHGWRLQYHVWLJDWHDFWXDOFRQGLWLRQVHJ )RUµ7HVW,¶ULEEHGUHEDUTXDOLWLHVZHUHXVHGWRLQYHVWLJDWHDFWXDOFRQGLWLRQVHJ
FRQFHUQLQJWKHHIIHFWRQUROOLQJDQGULEVIRUFRUURVLRQLQLWLDWLRQ FI6HFWLRQ  FRQFHUQLQJWKHHIIHFWRQUROOLQJDQGULEVIRUFRUURVLRQLQLWLDWLRQ FI6HFWLRQ 
)RUµ7HVW,,¶HPSKDVLVZDVVHWRQKRPRJHQHLW\WRDOORZH[DFWTXDQWLILFDWLRQRIWKH )RUµ7HVW,,¶HPSKDVLVZDVVHWRQKRPRJHQHLW\WRDOORZH[DFWTXDQWLILFDWLRQRIWKH
HIIHFWRIGLIIHUHQWVXUIDFHPRGLILFDWLRQDQGWKXVVPRRWKUHEDUVZHUHXVHG7KHIRO HIIHFWRIGLIIHUHQWVXUIDFHPRGLILFDWLRQDQGWKXVVPRRWKUHEDUVZHUHXVHG7KHIRO
ORZLQJULEEHGDQGVPRRWKFDUERQVWHHODQGVWDLQOHVVVWHHOTXDOLWLHVZHUHXVHGDOO ORZLQJULEEHGDQGVPRRWKFDUERQVWHHODQGVWDLQOHVVVWHHOTXDOLWLHVZHUHXVHGDOO
LQGLDPHWHURIPP LQGLDPHWHURIPP
ƕ 5LEEHG FDUERQ VWHHO UHEDU RI W\SH .76 >/0* D@ FRUUHVSRQGLQJ WR ƕ 5LEEHG FDUERQ VWHHO UHEDU RI W\SH .76 >/0* D@ FRUUHVSRQGLQJ WR
%$5$&>'6@ %$5$&>'6@
ƕ 5LEEHG VWDLQOHVV VWHHO UHEDU RI JUDGH  >'6(1  ƕ 5LEEHG VWDLQOHVV VWHHO UHEDU RI JUDGH  >'6(1 
@>$670'6@ @>$670'6@
ƕ 6PRRWK FDUERQ VWHHO EDU VWUXFWXUDO VWHHO  RI W\SH 6-5 >'6(1  ƕ 6PRRWK FDUERQ VWHHO EDU VWUXFWXUDO VWHHO  RI W\SH 6-5 >'6(1 
'6(1@ '6(1@
ƕ 6PRRWK VWDLQOHVV VWHHO EDU VWUXFWXUDO VWHHO  RI JUDGH  >'6(1 ƕ 6PRRWK VWDLQOHVV VWHHO EDU VWUXFWXUDO VWHHO  RI JUDGH  >'6(1
@>$670'6@ @>$670'6@
'HWDLOVRQWKHFRPSRVLWLRQDQGWKHPHWDOOXUJLFDOSURSHUWLHVRIWKHDSSOLHGULEEHG 'HWDLOVRQWKHFRPSRVLWLRQDQGWKHPHWDOOXUJLFDOSURSHUWLHVRIWKHDSSOLHGULEEHG
UHLQIRUFHPHQW VWHHO TXDOLWLHV DUH JLYHQ LQ 6HFWLRQ  IRU FDUERQ VWHHO DQG LQ UHLQIRUFHPHQW VWHHO TXDOLWLHV DUH JLYHQ LQ 6HFWLRQ  IRU FDUERQ VWHHO DQG LQ
6HFWLRQIRUVWDLQOHVVVWHHOUHEDUV 6HFWLRQIRUVWDLQOHVVVWHHOUHEDUV
‡ ([SRVXUHFRQGLWLRQV ‡ ([SRVXUHFRQGLWLRQV
$VPHQWLRQHGLQ6HFWLRQGXULQJ WKH H[SHULPHQWDO LQYHVWLJDWLRQVIRFXVZDV $VPHQWLRQHGLQ6HFWLRQGXULQJ WKH H[SHULPHQWDO LQYHVWLJDWLRQVIRFXVZDV
VHW RQ FKORULGH LQGXFHG FRUURVLRQ +RZHYHU QR FKORULGH RU RWKHU GHSDVVLYDWLQJ VHW RQ FKORULGH LQGXFHG FRUURVLRQ +RZHYHU QR FKORULGH RU RWKHU GHSDVVLYDWLQJ
VSHFLHVZHUHFDVWLQWRWKHPRUWDURUFHPHQWVSHFLPHQVVLQFHWKHWKHUPRG\QDPLF VSHFLHVZHUHFDVWLQWRWKHPRUWDURUFHPHQWVSHFLPHQVVLQFHWKHWKHUPRG\QDPLF
FRQGLWLRQVGXULQJERWKSDVVLYLW\DQGDFWLYHFRUURVLRQZHUHWREHLQYHVWLJDWHGDQG FRQGLWLRQVGXULQJERWKSDVVLYLW\DQGDFWLYHFRUURVLRQZHUHWREHLQYHVWLJDWHGDQG
SDUWLFXODUO\ WKH EUHDNGRZQ RI SDVVLYLW\ ZDV RI LQWHUHVW FI 6HFWLRQV  DQG SDUWLFXODUO\ WKH EUHDNGRZQ RI SDVVLYLW\ ZDV RI LQWHUHVW FI 6HFWLRQV  DQG
 +HQFHFRUURVLRQLQLWLDWLRQDQGSURSDJDWLRQZDVVROHO\EDVHGRQH[SRVXUH  +HQFHFRUURVLRQLQLWLDWLRQDQGSURSDJDWLRQZDVVROHO\EDVHGRQH[SRVXUH
WR FKORULGH VROXWLRQ 'XULQJ DOO H[SHULPHQWDO LQYHVWLJDWLRQV H[SRVXUH VROXWLRQV WR FKORULGH VROXWLRQ 'XULQJ DOO H[SHULPHQWDO LQYHVWLJDWLRQV H[SRVXUH VROXWLRQV
FRUUHVSRQGHG WR  ZHLJKWE\ZHLJKW µZZ¶ FKORULGH VROXWLRQ J1D&O SHU FRUUHVSRQGHG WR  ZHLJKWE\ZHLJKW µZZ¶ FKORULGH VROXWLRQ J1D&O SHU
OLWUHVROXWLRQ LQDFFRUGDQFHZLWK17EXLOG>)UHGHULNVHQ@DQGWRSRWDEOH OLWUHVROXWLRQ LQDFFRUGDQFHZLWK17EXLOG>)UHGHULNVHQ@DQGWRSRWDEOH
ZDWHUDVUHIHUHQFHH[SRVXUHVROXWLRQ WKHFKORULGHVROXWLRQZDVEDVHGRQWKHVDPH ZDWHUDVUHIHUHQFHH[SRVXUHVROXWLRQ WKHFKORULGHVROXWLRQZDVEDVHGRQWKHVDPH
SRWDEOHZDWHU ,QDFFRUGDQFHZLWK17EXLOGWKHWHPSHUDWXUHRIDOOH[SRVXUH SRWDEOHZDWHU ,QDFFRUGDQFHZLWK17EXLOGWKHWHPSHUDWXUHRIDOOH[SRVXUH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


,QWURGXFWLRQ 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV ,QWURGXFWLRQ 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV

VROXWLRQV ZDV NHSW DW  ±  ƒ& )XUWKHU GHWDLOV RQ WKH H[SRVXUH FRQGLWLRQV DUH VROXWLRQV ZDV NHSW DW  ±  ƒ& )XUWKHU GHWDLOV RQ WKH H[SRVXUH FRQGLWLRQV DUH
JLYHQLQ6HFWLRQFRQFHUQLQJFKORULGHVROXWLRQDQGSRWDEOHZDWHUFRQWDLQHUVRI JLYHQLQ6HFWLRQFRQFHUQLQJFKORULGHVROXWLRQDQGSRWDEOHZDWHUFRQWDLQHUVRI
WKHWHVWLQJVHWXSDQGLQ6HFWLRQFRQFHUQLQJDVXSSOHPHQWDU\VHWXSIRUGH WKHWHVWLQJVHWXSDQGLQ6HFWLRQFRQFHUQLQJDVXSSOHPHQWDU\VHWXSIRUGH
VWUXFWLYHHOHFWURFKHPLFDOWHVWLQJ VWUXFWLYHHOHFWURFKHPLFDOWHVWLQJ

 ,QYHVWLJDWLRQVRQ6WHHO4XDOLWLHVDQG6XUIDFH7UHDWPHQWV  ,QYHVWLJDWLRQVRQ6WHHO4XDOLWLHVDQG6XUIDFH7UHDWPHQWV


7KHH[SHULPHQWDOVHWXSXVHGDQGVHOHFWHGUHVXOWVIURPWKHILUVWH[SHULPHQWDOLQYHVWL 7KHH[SHULPHQWDOVHWXSXVHGDQGVHOHFWHGUHVXOWVIURPWKHILUVWH[SHULPHQWDOLQYHVWL
JDWLRQVFRQFHUQLQJWKHWKHUPRG\QDPLFSURSHUWLHVRIGLIIHUHQWVWHHOTXDOLWLHVDQGFDU JDWLRQVFRQFHUQLQJWKHWKHUPRG\QDPLFSURSHUWLHVRIGLIIHUHQWVWHHOTXDOLWLHVDQGFDU
ERQVWHHOVXUIDFHWUHDWPHQWV LHµ7HVW ,¶  DUHGHVFULEHGLQ>.WHU HWDO .WHU ERQVWHHOVXUIDFHWUHDWPHQWV LHµ7HVW ,¶  DUHGHVFULEHGLQ>.WHU HWDO .WHU
HWDOE@%HVLGHVLQYHVWLJDWLQJWKHUPRG\QDPLFSURSHUWLHVWKHVHLQLWLDOWHVWDLPHG HWDOE@%HVLGHVLQYHVWLJDWLQJWKHUPRG\QDPLFSURSHUWLHVWKHVHLQLWLDOWHVWDLPHG
DWYHULI\LQJWKHGHVLJQRIWKHLQVWUXPHQWHGPRUWDUVSHFLPHQ LQSDUWLFXODUZLWKUHJDUG DWYHULI\LQJWKHGHVLJQRIWKHLQVWUXPHQWHGPRUWDUVSHFLPHQ LQSDUWLFXODUZLWKUHJDUG
WRµ(,6¶ DQGWRFDOLEUDWHWKHDSSOLHGPHDVXUHPHQWWHFKQLTXHV WRµ(,6¶ DQGWRFDOLEUDWHWKHDSSOLHGPHDVXUHPHQWWHFKQLTXHV
7KHIROORZLQJVWHHOTXDOLWLHVDQGVXUIDFHWUHDWPHQWVZHUHH[DPLQHGEDVHGRQWKHLQ 7KHIROORZLQJVWHHOTXDOLWLHVDQGVXUIDFHWUHDWPHQWVZHUHH[DPLQHGEDVHGRQWKHLQ
VWUXPHQWHGPRUWDUVSHFLPHQ VWUXPHQWHGPRUWDUVSHFLPHQ
‡ 5LEEHGFDUERQVWHHOUHEDUV ‡ 5LEEHGFDUERQVWHHOUHEDUV
ƕ $VUHFHLYHG,QGLFHV³&^$%`´ ƕ $VUHFHLYHG,QGLFHV³&^$%`´
ƕ :HDWKHUHGDFFRUGLQJWR>$670%@,QGLFHV³&^$%`´ ƕ :HDWKHUHGDFFRUGLQJWR>$670%@,QGLFHV³&^$%`´
ƕ *ULWEODVWHG JULWURXJKQHVV—P ,QGLFHV³&^$%`´ ƕ *ULWEODVWHG JULWURXJKQHVV—P ,QGLFHV³&^$%`´
ƕ 'HJUHDVHG DONDOLQHDQRGLFFI6HFWLRQ ,QGLFHV³&^$%`´ ƕ 'HJUHDVHG DONDOLQHDQRGLFFI6HFWLRQ ,QGLFHV³&^$%`´
ƕ +&OHWFKHG FI6HFWLRQ ,QGLFHV³&^$%`´DQG³:^$%`´ ƕ +&OHWFKHG FI6HFWLRQ ,QGLFHV³&^$%`´DQG³:^$%`´

ƕ *DOYDQLVHG +&OHWFKHGDQG—P ]LQFOD\HUDSSOLHGHOHFWURO\WLFDOO\FI6HF ƕ *DOYDQLVHG +&OHWFKHGDQG—P ]LQFOD\HUDSSOLHGHOHFWURO\WLFDOO\FI6HF
WLRQ ,QGLFHV³&^$%`´ WLRQ ,QGLFHV³&^$%`´
‡ 5LEEHGVWDLQOHVVVWHHOUHEDUV ‡ 5LEEHGVWDLQOHVVVWHHOUHEDUV
ƕ 'HJUHDVHG DONDOLQHFDWKRGLF6HFWLRQ ,QGLFHV³&^$%`´ ƕ 'HJUHDVHG DONDOLQHFDWKRGLF6HFWLRQ ,QGLFHV³&^$%`´
)RU PRQLWRULQJ FKORULGH LQJUHVV LQVWUXPHQWHG PRUWDU VSHFLPHQV ZLWK FDUERQ VWHHO )RU PRQLWRULQJ FKORULGH LQJUHVV LQVWUXPHQWHG PRUWDU VSHFLPHQV ZLWK FDUERQ VWHHO
µ((:V¶ ZHUH SURGXFHG EDVHG RQ WKH +&O HWFKHG VSHFLPHQV ³&6^ `´  0RUH µ((:V¶ ZHUH SURGXFHG EDVHG RQ WKH +&O HWFKHG VSHFLPHQV ³&6^ `´  0RUH
RYHUSODLQPRUWDUVSHFLPHQV ³&3^`´DQG³:3^`´ DQGLQVWUXPHQWHGVSHFL RYHUSODLQPRUWDUVSHFLPHQV ³&3^`´DQG³:3^`´ DQGLQVWUXPHQWHGVSHFL
PHQVZLWKRXWUHEDU ³&1^`´DQG³:1^`´ ZHUHWHVWHG FI6HFWLRQ  PHQVZLWKRXWUHEDU ³&1^`´DQG³:1^`´ ZHUHWHVWHG FI6HFWLRQ 

 ,QYHVWLJDWLRQVRQ6WHHO4XDOLWLHVDQG6XUIDFH0RGLILFDWLRQV  ,QYHVWLJDWLRQVRQ6WHHO4XDOLWLHVDQG6XUIDFH0RGLILFDWLRQV


7KH IROORZLQJ VWHHO TXDOLWLHV DQG VXUIDFH PRGLILFDWLRQV ZHUH H[DPLQHG EDVHG RQ LQ 7KH IROORZLQJ VWHHO TXDOLWLHV DQG VXUIDFH PRGLILFDWLRQV ZHUH H[DPLQHG EDVHG RQ LQ
VWUXPHQWHGPRUWDUVSHFLPHQV LQGLFHVHQGLQJRQ³$´ VLPSOHPRUWDUVSHFLPHQV LQ VWUXPHQWHGPRUWDUVSHFLPHQV LQGLFHVHQGLQJRQ³$´ VLPSOHPRUWDUVSHFLPHQV LQ
GLFHVHQGLQJRQ³%´ DQGFHPHQWSDVWHVSHFLPHQV LQGLFHVHQGLQJRQ³&´DQG³'´  GLFHVHQGLQJRQ³%´ DQGFHPHQWSDVWHVSHFLPHQV LQGLFHVHQGLQJRQ³&´DQG³'´ 
‡ 6PRRWKFDUERQVWHHOUHEDUV ‡ 6PRRWKFDUERQVWHHOUHEDUV

 

7KHWKLFNQHVVRIWKH]LQFOD\HUZDVPHDVXUHGDFFRUGLQJWR>:HLGPDQQ@ 7KHWKLFNQHVVRIWKH]LQFOD\HUZDVPHDVXUHGDFFRUGLQJWR>:HLGPDQQ@

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV ,QWURGXFWLRQ 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV ,QWURGXFWLRQ

ƕ *ULWEODVWHG JULWURXJKQHVV—P` ,QGLFHV ³&^$'`´ DQG ³: ƕ *ULWEODVWHG JULWURXJKQHVV—P` ,QGLFHV ³&^$'`´ DQG ³:
^$'`´ ^$'`´
ƕ *DOYDQLVHG JULWEODVWHGDQG—P]LQFOD\HUDSSOLHGHOHFWURO\WLFDOO\FI6HF ƕ *DOYDQLVHG JULWEODVWHGDQG—P]LQFOD\HUDSSOLHGHOHFWURO\WLFDOO\FI6HF
WLRQ ZLWKRXWGHIHFWZLWKGHIHFW,QGLFHV³&^$'`´DQG³:^$ WLRQ ZLWKRXWGHIHFWZLWKGHIHFW,QGLFHV³&^$'`´DQG³:^$
'`´³&^$'`´DQG³:^$'`´ '`´³&^$'`´DQG³:^$'`´
ƕ 0RGLILFDWLRQ W\SH ^,,,,` ZLWKRXW GHIHFW  ZLWK GHIHFW ,QGLFHV PRGLILFDWLRQ ƕ 0RGLILFDWLRQ W\SH ^,,,,` ZLWKRXW GHIHFW  ZLWK GHIHFW ,QGLFHV PRGLILFDWLRQ
W\SH,³&^$'`´DQG³:^$'`´³&^$'`´DQG³:^$'`´ W\SH,³&^$'`´DQG³:^$'`´³&^$'`´DQG³:^$'`´
,QGLFHV PRGLILFDWLRQ W\SH ,, ³&^$'`´ DQG ³:^$ '`´  ³&^$ ,QGLFHV PRGLILFDWLRQ W\SH ,, ³&^$'`´ DQG ³:^$ '`´  ³&^$
'`´ DQG ³:^$ '`´ ,QGLFHV PRGLILFDWLRQ W\SH ,,, ³&^$'`´ DQG '`´ DQG ³:^$ '`´ ,QGLFHV PRGLILFDWLRQ W\SH ,,, ³&^$'`´ DQG
³:^$'`´³&^$'`´DQG³:^$'`´ ³:^$'`´³&^$'`´DQG³:^$'`´
‡ 6PRRWKVWDLQOHVVVWHHOUHEDUV ‡ 6PRRWKVWDLQOHVVVWHHOUHEDUV
ƕ (OHFWURFKHPLFDOO\FOHDQHG DONDOLQHFDWKRGLFFI6HFWLRQ  ƕ (OHFWURFKHPLFDOO\FOHDQHG DONDOLQHFDWKRGLFFI6HFWLRQ 
%HVLGHVWKHDERYHOLVWHGVSHFLPHQVZKLFKZHUHPRQLWRUHGDQGWHVWHGLQWKHWZRH[ %HVLGHVWKHDERYHOLVWHGVSHFLPHQVZKLFKZHUHPRQLWRUHGDQGWHVWHGLQWKHWZRH[
SRVXUH FRQWDLQHUV WZHOYH FHPHQW SDVWH VSHFLPHQV FRUUHVSRQGLQJ WR HDFK VXUIDFH SRVXUH FRQWDLQHUV WZHOYH FHPHQW SDVWH VSHFLPHQV FRUUHVSRQGLQJ WR HDFK VXUIDFH
PRGLILFDWLRQDQGH[SRVXUHVLWXDWLRQ LQGLFHVHQGLQJZLWK³(´WR³3´ ZHUHWHVWHGGH PRGLILFDWLRQDQGH[SRVXUHVLWXDWLRQ LQGLFHVHQGLQJZLWK³(´WR³3´ ZHUHWHVWHGGH
VWUXFWLYHO\E\PHDQVRIIXOOVFDOHDQRGLFSRODULVDWLRQFXUYHPHDVXUHPHQWVLQDVHSD VWUXFWLYHO\E\PHDQVRIIXOOVFDOHDQRGLFSRODULVDWLRQFXUYHPHDVXUHPHQWVLQDVHSD
UDWHWKUHHSRLQWHOHFWURGHVHWXS FI6HFWLRQ 'HWDLOVRQWKHVSHFLPHQVWHVWHG UDWHWKUHHSRLQWHOHFWURGHVHWXS FI6HFWLRQ 'HWDLOVRQWKHVSHFLPHQVWHVWHG
LQWKHH[SRVXUHFRQWDLQHUV FI6HFWLRQ GXULQJµ7HVW,,¶DUHJLYHQLQ7DEOH LQWKHH[SRVXUHFRQWDLQHUV FI6HFWLRQ GXULQJµ7HVW,,¶DUHJLYHQLQ7DEOH
 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


,QWURGXFWLRQ 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV ,QWURGXFWLRQ 2XWOLQHRI([SHULPHQWDO,QYHVWLJDWLRQV

7DEOH ,QGLFHVVXUIDFHPRGLILFDWLRQSXUSRVHDQGDPRXQWRIVSHFLPHQVWHVWHG 7DEOH ,QGLFHVVXUIDFHPRGLILFDWLRQSXUSRVHDQGDPRXQWRIVSHFLPHQVWHVWHG


LQ WKH H[SRVXUH FRQWDLQHUV FI 6HFWLRQ   GXULQJ WKH FRQFOXGLQJ H[ LQ WKH H[SRVXUH FRQWDLQHUV FI 6HFWLRQ   GXULQJ WKH FRQFOXGLQJ H[
SHULPHQWVIRUWKHLQYHVWLJDWLRQVRQVWHHOTXDOLWLHVDQGVXUIDFHPRGLILFD SHULPHQWVIRUWKHLQYHVWLJDWLRQVRQVWHHOTXDOLWLHVDQGVXUIDFHPRGLILFD
WLRQV WLRQV
,QGH[ 6XUIDFHPRGLILFDWLRQ 3XUSRVH $PRXQW ,QGH[ 6XUIDFHPRGLILFDWLRQ 3XUSRVH $PRXQW
&KORULGHVROXWLRQH[SRVXUHVHWXS &KORULGHVROXWLRQH[SRVXUHVHWXS
&30^` 1RUHEDUQRHOHFWURGH &KORULGHLQJUHVVE\FRORXUWHVW  &30^` 1RUHEDUQRHOHFWURGH &KORULGHLQJUHVVE\FRORXUWHVW 
&15^` 1RUHEDU $FWLYDWHG7LSRWHQWLDO  &15^` 1RUHEDU $FWLYDWHG7LSRWHQWLDO 
&6:^` *ULWEODVWHGVWHHOZLUHV &KORULGHLQJUHVV  &6:^` *ULWEODVWHGVWHHOZLUHV &KORULGHLQJUHVV 
&^$'` *ULWEODVWHG &RUURVLRQSURSHUWLHV  &^$'` *ULWEODVWHG &RUURVLRQSURSHUWLHV 
&^$'` 6WDLQOHVVVWHHO &RUURVLRQSURSHUWLHV  &^$'` 6WDLQOHVVVWHHO &RUURVLRQSURSHUWLHV 
&^$'` *DOYDQLVHG &RUURVLRQSURSHUWLHV  &^$'` *DOYDQLVHG &RUURVLRQSURSHUWLHV 
&^$'` *DOYDQLVHGGHIHFW &RUURVLRQSURSHUWLHV  &^$'` *DOYDQLVHGGHIHFW &RUURVLRQSURSHUWLHV 
&^$'` 0RGLILFDWLRQW\SH, &RUURVLRQSURSHUWLHV  &^$'` 0RGLILFDWLRQW\SH, &RUURVLRQSURSHUWLHV 
&^$'` 0RGLILFDWLRQW\SH,GHIHFW &RUURVLRQSURSHUWLHV  &^$'` 0RGLILFDWLRQW\SH,GHIHFW &RUURVLRQSURSHUWLHV 
&^$'` 0RGLILFDWLRQW\SH,, &RUURVLRQSURSHUWLHV  &^$'` 0RGLILFDWLRQW\SH,, &RUURVLRQSURSHUWLHV 
&^$'` 0RGLILFDWLRQW\SH,,GHIHFW &RUURVLRQSURSHUWLHV  &^$'` 0RGLILFDWLRQW\SH,,GHIHFW &RUURVLRQSURSHUWLHV 
&^$'` 0RGLILFDWLRQW\SH,,, &RUURVLRQSURSHUWLHV  &^$'` 0RGLILFDWLRQW\SH,,, &RUURVLRQSURSHUWLHV 
&^$'` 0RGLILFDWLRQW\SH,,,GHIHFW &RUURVLRQSURSHUWLHV  &^$'` 0RGLILFDWLRQW\SH,,,GHIHFW &RUURVLRQSURSHUWLHV 
5LEEHGUHEDUVSHFLPHQV &RUURVLRQSURSHUWLHV 5LEEHGUHEDUVSHFLPHQV &RUURVLRQSURSHUWLHV
&^`%  &^`% 
FI6HFWLRQ  FRQWLQXDWLRQ  FI6HFWLRQ  FRQWLQXDWLRQ 
  5HVHUYHGIRUVKRUWWHUPWHVWV    5HVHUYHGIRUVKRUWWHUPWHVWV 
1XPEHURIVSHFLPHQVLQFKORULGHVROXWLRQFRQWDLQHU  1XPEHURIVSHFLPHQVLQFKORULGHVROXWLRQFRQWDLQHU 
3RWDEOHZDWHUH[SRVXUHVHWXS 3RWDEOHZDWHUH[SRVXUHVHWXS
:30^` 1RUHEDUQRHOHFWURGH &KHPLFDOLQYHVWLJDWLRQVUHIHUHQFH  :30^` 1RUHEDUQRHOHFWURGH &KHPLFDOLQYHVWLJDWLRQVUHIHUHQFH 
:15 1RUHEDU $FWLYDWHG7LSRWHQWLDOUHIHUHQFH  :15 1RUHEDU $FWLYDWHG7LSRWHQWLDOUHIHUHQFH 
:6: *ULWEODVWHGVWHHOZLUHV &KORULGHLQJUHVVUHIHUHQFH  :6: *ULWEODVWHGVWHHOZLUHV &KORULGHLQJUHVVUHIHUHQFH 
:^$'` *ULWEODVWHG &RUURVLRQSURSHUWLHVUHIHUHQFH  :^$'` *ULWEODVWHG &RUURVLRQSURSHUWLHVUHIHUHQFH 
:^$'` 6WDLQOHVVVWHHO &RUURVLRQSURSHUWLHVUHIHUHQFH  :^$'` 6WDLQOHVVVWHHO &RUURVLRQSURSHUWLHVUHIHUHQFH 
:^$'` *DOYDQLVHG &RUURVLRQSURSHUWLHVUHIHUHQFH  :^$'` *DOYDQLVHG &RUURVLRQSURSHUWLHVUHIHUHQFH 
:^$'` *DOYDQLVHGGHIHFW &RUURVLRQSURSHUWLHVUHIHUHQFH  :^$'` *DOYDQLVHGGHIHFW &RUURVLRQSURSHUWLHVUHIHUHQFH 
:^$'` 0RGLILFDWLRQW\SH, &RUURVLRQSURSHUWLHVUHIHUHQFH  :^$'` 0RGLILFDWLRQW\SH, &RUURVLRQSURSHUWLHVUHIHUHQFH 
:^$'` 0RGLILFDWLRQW\SH,GHIHFW &RUURVLRQSURSHUWLHVUHIHUHQFH  :^$'` 0RGLILFDWLRQW\SH,GHIHFW &RUURVLRQSURSHUWLHVUHIHUHQFH 
:^$'` 0RGLILFDWLRQW\SH,, &RUURVLRQSURSHUWLHVUHIHUHQFH  :^$'` 0RGLILFDWLRQW\SH,, &RUURVLRQSURSHUWLHVUHIHUHQFH 
:^$'` 0RGLILFDWLRQW\SH,,GHIHFW &RUURVLRQSURSHUWLHVUHIHUHQFH  :^$'` 0RGLILFDWLRQW\SH,,GHIHFW &RUURVLRQSURSHUWLHVUHIHUHQFH 
:^$'` 0RGLILFDWLRQW\SH,,, &RUURVLRQSURSHUWLHVUHIHUHQFH  :^$'` 0RGLILFDWLRQW\SH,,, &RUURVLRQSURSHUWLHVUHIHUHQFH 
:^$'` 0RGLILFDWLRQW\SH,,,GHIHFW &RUURVLRQSURSHUWLHVUHIHUHQFH  :^$'` 0RGLILFDWLRQW\SH,,,GHIHFW &RUURVLRQSURSHUWLHVUHIHUHQFH 
5LEEHGUHEDUVSHFLPHQ &RUURVLRQSURSHUWLHVUHIHUHQFH FRQ 5LEEHGUHEDUVSHFLPHQ &RUURVLRQSURSHUWLHVUHIHUHQFH FRQ
:%  :% 
FI6HFWLRQ  WLQXDWLRQ  FI6HFWLRQ  WLQXDWLRQ 
  5HVHUYHGIRUVKRUWWHUPWHVWV    5HVHUYHGIRUVKRUWWHUPWHVWV 
1XPEHURIVSHFLPHQVH[SRVHGLQSRWDEOHZDWHUFRQWDLQHU  1XPEHURIVSHFLPHQVH[SRVHGLQSRWDEOHZDWHUFRQWDLQHU 
7RWDOQXPEHURIVSHFLPHQVLQERWKFRQWDLQHUV  7RWDOQXPEHURIVSHFLPHQVLQERWKFRQWDLQHUV 
 


 7KHPRGLILFDWLRQVW\SHV,,,,DUHQRWGHVFULEHGLQGHWDLOGXHWRH[SHFWHGSDWHQWSRVVLELOLWLHV FI6HFWLRQ   7KHPRGLILFDWLRQVW\SHV,,,,DUHQRWGHVFULEHGLQGHWDLOGXHWRH[SHFWHGSDWHQWSRVVLELOLWLHV FI6HFWLRQ 
+RZHYHUDOOWKUHHVXUIDFHPRGLILFDWLRQW\SHVDUHUHODWHGWRWKHWKHRUHWLFDOFRQFHSWVSURSRVHGLQ6HFWLRQ +RZHYHUDOOWKUHHVXUIDFHPRGLILFDWLRQW\SHVDUHUHODWHGWRWKHWKHRUHWLFDOFRQFHSWVSURSRVHGLQ6HFWLRQ
LHLPSOHPHQWDWLRQRI]LQFDQGPDJQHVLXPDVSULQFLSDOHOHFWURFKHPLFDODFWLYHFRPSRXQGV LHLPSOHPHQWDWLRQRI]LQFDQGPDJQHVLXPDVSULQFLSDOHOHFWURFKHPLFDODFWLYHFRPSRXQGV

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 

 $TXHRXV0HWDOOLF&RUURVLRQ  $TXHRXV0HWDOOLF&RUURVLRQ
6HOHFWHGWKHRU\DQGDQDO\WLFDOWRROVIRUWKHWKHUPRG\QDPLFDQGNLQHWLFGHVFULSWLRQRI 6HOHFWHGWKHRU\DQGDQDO\WLFDOWRROVIRUWKHWKHUPRG\QDPLFDQGNLQHWLFGHVFULSWLRQRI
DTXHRXV PHWDOOLF FRUURVLRQ ZKLFK DUH LQWURGXFHG LQ 6HFWLRQV  DQG  UHVSHF DTXHRXV PHWDOOLF FRUURVLRQ ZKLFK DUH LQWURGXFHG LQ 6HFWLRQV  DQG  UHVSHF
WLYHO\FRQVWLWXWHWKHPDMRUSDUWRIWKLV&KDSWHU)XUWKHUPRUHIRUPVRIPHWDOOLFFRUUR WLYHO\FRQVWLWXWHWKHPDMRUSDUWRIWKLV&KDSWHU)XUWKHUPRUHIRUPVRIPHWDOOLFFRUUR
VLRQ 6HFWLRQ WKHFRUUHODWLRQEHWZHHQWKHUPRG\QDPLFVDQGNLQHWLFV 6HFWLRQ  VLRQ 6HFWLRQ WKHFRUUHODWLRQEHWZHHQWKHUPRG\QDPLFVDQGNLQHWLFV 6HFWLRQ 
VHOHFWHGHOHFWURFKHPLFDOPHDVXUHPHQWWHFKQLTXHV 6HFWLRQ DQGWKHDSSOLFDWLRQRI VHOHFWHGHOHFWURFKHPLFDOPHDVXUHPHQWWHFKQLTXHV 6HFWLRQ DQGWKHDSSOLFDWLRQRI
HOHFWURFKHPLVWU\LQVWHHOVXUIDFHWUHDWPHQWV 6HFWLRQ DUHGHVFULEHG HOHFWURFKHPLVWU\LQVWHHOVXUIDFHWUHDWPHQWV 6HFWLRQ DUHGHVFULEHG
7KLV &KDSWHU LV OLPLWHG WR WKH WKHRU\ RI PHWDOOLF FRUURVLRQ LQ DTXHRXV HOHFWURO\WHV 7KLV &KDSWHU LV OLPLWHG WR WKH WKHRU\ RI PHWDOOLF FRUURVLRQ LQ DTXHRXV HOHFWURO\WHV
2WKHUIRUPVRIFRUURVLRQDUHJHQHUDOO\QRWWDNHQLQWRFRQVLGHUDWLRQLQWKHSUHVHQWWKH 2WKHUIRUPVRIFRUURVLRQDUHJHQHUDOO\QRWWDNHQLQWRFRQVLGHUDWLRQLQWKHSUHVHQWWKH
VLV0RVWRIWKHGHVFULEHGWKHRU\LVDSSOLFDEOHWRFRUURVLRQRIPHWDOVLQJHQHUDOZKLOH VLV0RVWRIWKHGHVFULEHGWKHRU\LVDSSOLFDEOHWRFRUURVLRQRIPHWDOVLQJHQHUDOZKLOH
VSHFLDOHPSKDVLVLVVHWRQLURQ HVSHFLDOO\LQWKHH[HPSOLILFDWLRQV ZKLFKZHFRQVLGHU VSHFLDOHPSKDVLVLVVHWRQLURQ HVSHFLDOO\LQWKHH[HPSOLILFDWLRQV ZKLFKZHFRQVLGHU
WRUHSUHVHQWVXIILFLHQWO\WKHHOHFWURFKHPLFDOSURSHUWLHVRIFDUERQVWHHO WRUHSUHVHQWVXIILFLHQWO\WKHHOHFWURFKHPLFDOSURSHUWLHVRIFDUERQVWHHO
$TXHRXVPHWDOOLFFRUURVLRQLVDQHOHFWURFKHPLFDOSURFHVVZKLFKFRQVLVWVRIDYDULHW\ $TXHRXVPHWDOOLFFRUURVLRQLVDQHOHFWURFKHPLFDOSURFHVVZKLFKFRQVLVWVRIDYDULHW\
RIHOHFWURFKHPLFDOUHDFWLRQVLQYROYLQJWKHWUDQVIHUIURPRQHFKHPLFDOVSHFLHVWRWKH RI HOHFWURFKHPLFDO UHDFWLRQV LQYROYLQJ WKH WUDQVIHU IURP RQH FKHPLFDO VSHFLHVWRWKH
RWKHU,QVLPSOHWHUPVWKHUPRG\QDPLFVSURYLGHVLQIRUPDWLRQRQWKHW\SHRIHOHFWUR RWKHU,QVLPSOHWHUPVWKHUPRG\QDPLFVSURYLGHVLQIRUPDWLRQRQWKHW\SHRIHOHFWUR
FKHPLFDOUHDFWLRQDQGLWVWHQGHQF\WRRFFXULQDFHUWDLQHQYLURQPHQWZKHUHDVNLQHWLFV FKHPLFDOUHDFWLRQDQGLWVWHQGHQF\WRRFFXULQDFHUWDLQHQYLURQPHQWZKHUHDVNLQHWLFV
SURYLGHVLQIRUPDWLRQRQWKHUDWHDWZKLFKWKHWUDQVIHURFFXUV SURYLGHVLQIRUPDWLRQRQWKHUDWHDWZKLFKWKHWUDQVIHURFFXUV
&KDSWHUGHDOVZLWKSURSHUWLHVRIFRQFUHWHDQGFDUERQVWHHOWKDWUHODWHWRERWKWKHU &KDSWHUGHDOVZLWKSURSHUWLHVRIFRQFUHWHDQGFDUERQVWHHOWKDWUHODWHWRERWKWKHU
PRG\QDPLFVDQGNLQHWLFVZKLOHWKHVXEVHTXHQW&KDSWHUVDQGFRYHULQJWKHUPR PRG\QDPLFVDQGNLQHWLFVZKLOHWKHVXEVHTXHQW&KDSWHUVDQGFRYHULQJWKHUPR
G\QDPLFV RI FDUERQ VWHHO UHLQIRUFHPHQW FRUURVLRQ DYDLODEOH FRUURVLRQ FRXQWHUPHD G\QDPLFV RI FDUERQ VWHHO UHLQIRUFHPHQW FRUURVLRQ DYDLODEOH FRUURVLRQ FRXQWHUPHD
VXUHV DQG WKH GHYHORSPHQW RI QHZ FRXQWHUPHDVXUHV UHVSHFWLYHO\ ODUJHO\ GHDO ZLWK VXUHV DQG WKH GHYHORSPHQW RI QHZ FRXQWHUPHDVXUHV UHVSHFWLYHO\ ODUJHO\ GHDO ZLWK
WKHUPRG\QDPLFV RQO\ .LQHWLF FRQVLGHUDWLRQV HVSHFLDOO\ SRODULVDWLRQ FXUYHV  ZHUH WKHUPRG\QDPLFV RQO\ .LQHWLF FRQVLGHUDWLRQV HVSHFLDOO\ SRODULVDWLRQ FXUYHV  ZHUH
HVVHQWLDO LQ WKH H[SHULPHQWDO SDUW RI WKLV SURMHFW %HVLGHV GHVFULELQJ WKH QHFHVVDU\ HVVHQWLDO LQ WKH H[SHULPHQWDO SDUW RI WKLV SURMHFW %HVLGHV GHVFULELQJ WKH QHFHVVDU\
EDFNJURXQGRIWKHH[SHULPHQWDOLQYHVWLJDWLRQV6HFWLRQLOOXVWUDWHVWKHLPSRUWDQFH EDFNJURXQGRIWKHH[SHULPHQWDOLQYHVWLJDWLRQV6HFWLRQLOOXVWUDWHVWKHLPSRUWDQFH
RINLQHWLFVDQGKHQFHWKHOLPLWDWLRQVRIWKHUPRG\QDPLFV RINLQHWLFVDQGKHQFHWKHOLPLWDWLRQVRIWKHUPRG\QDPLFV

 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ  7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ


7KHUPRG\QDPLFV SURYLGHV DQ XQGHUVWDQGLQJ RI WKH HQHUJ\ FKDQJHV LQYROYHG LQ WKH 7KHUPRG\QDPLFV SURYLGHV DQ XQGHUVWDQGLQJ RI WKH HQHUJ\ FKDQJHV LQYROYHG LQ WKH
HOHFWURFKHPLFDO UHDFWLRQV RI FRUURVLRQ 7KHVH HQHUJ\ FKDQJHV SURYLGH WKH GULYLQJ HOHFWURFKHPLFDO UHDFWLRQV RI FRUURVLRQ 7KHVH HQHUJ\ FKDQJHV SURYLGH WKH GULYLQJ
IRUFH DQG FRQWURO WKH VSRQWDQHRXVGLUHFWLRQRIDFKHPLFDOUHDFWLRQ7KXVWKHUPRG\ IRUFH DQG FRQWURO WKH VSRQWDQHRXV GLUHFWLRQ RI D FKHPLFDO UHDFWLRQ7KXVWKHUPRG\
QDPLFVPD\LOOXVWUDWHKRZFRQGLWLRQVFDQEHDGMXVWHGWRPDNHFRUURVLRQLPSRVVLEOH QDPLFVPD\LOOXVWUDWHKRZFRQGLWLRQVFDQEHDGMXVWHGWRPDNHFRUURVLRQLPSRVVLEOH
$VRXWOLQHGLQ6HFWLRQRXULQWHQWLRQZDVWRXVHWKHUPRG\QDPLFWRROVWRGHVFULEH $VRXWOLQHGLQ6HFWLRQRXULQWHQWLRQZDVWRXVHWKHUPRG\QDPLFWRROVWRGHVFULEH
FRUURVLRQPHFKDQLVPVDQGWRDSSO\WKLVNQRZOHGJHLQWKHHYDOXDWLRQRIDYDLODEOHDQG FRUURVLRQPHFKDQLVPVDQGWRDSSO\WKLVNQRZOHGJHLQWKHHYDOXDWLRQRIDYDLODEOHDQG
WKHGHVLJQRIQHZFRXQWHUPHDVXUHV WKHGHVLJQRIQHZFRXQWHUPHDVXUHV
,QWKLV6HFWLRQWKHWKHRUHWLFDOEDVLVIRUWKHUPRG\QDPLFFRQVLGHUDWLRQVLVH[SODLQHGLQ ,QWKLV6HFWLRQWKHWKHRUHWLFDOEDVLVIRUWKHUPRG\QDPLFFRQVLGHUDWLRQVLVH[SODLQHGLQ
PRUH GHWDLO ZKHUHDV WKH EDFNJURXQG RQ WKH IXQGDPHQWDO HOHFWURFKHPLVWU\ RI FRUUR PRUH GHWDLO ZKHUHDV WKH EDFNJURXQG RQ WKH IXQGDPHQWDO HOHFWURFKHPLVWU\ RI FRUUR
VLRQLVGHDOWZLWKUDWKHUEULHIO\7KHEDVLFFRQFHSWVUHJDUGLQJUHDFWLRQPHFKDQLVPV LQ VLRQLVGHDOWZLWKUDWKHUEULHIO\7KHEDVLFFRQFHSWVUHJDUGLQJUHDFWLRQPHFKDQLVPV LQ
SDUWLFXODUYHULILFDWLRQVEDVHGRQHOHFWURGHSRWHQWLDOVDQGWKHLQYROYHG*LEEVIUHHHQ SDUWLFXODUYHULILFDWLRQVEDVHGRQHOHFWURGHSRWHQWLDOVDQGWKHLQYROYHG*LEEVIUHHHQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

HUJ\FKDQJHV DQGPRVWLPSRUWDQWO\WKH3RXUEDL[GLDJUDPDUHH[SODLQHGLQPRUHGH HUJ\FKDQJHV DQGPRVWLPSRUWDQWO\WKH3RXUEDL[GLDJUDPDUHH[SODLQHGLQPRUHGH


WDLODVWKHVHFRQFHSWVDUHFHQWUDOLQWKLVWKHVLV WDLODVWKHVHFRQFHSWVDUHFHQWUDOLQWKLVWKHVLV

 5HDFWLRQ0HFKDQLVPV  5HDFWLRQ0HFKDQLVPV


5HDFWLRQPHFKDQLVPVFDQEHXVHGWRGHVFULEHXQGHUVWDQGDQGYHULI\FRUURVLRQSURF 5HDFWLRQPHFKDQLVPVFDQEHXVHGWRGHVFULEHXQGHUVWDQGDQGYHULI\FRUURVLRQSURF
HVVHV DQG DFFRUGLQJO\ PHDVXUHV WKDW FDQ FRXQWHUDFW FRUURVLRQ 7KHUHIRUH GHWDLOHG HVVHV DQG DFFRUGLQJO\ PHDVXUHV WKDW FDQ FRXQWHUDFW FRUURVLRQ 7KHUHIRUH GHWDLOHG
HYDOXDWLRQRUHVWDEOLVKPHQWRIGHVFULSWLYHUHDFWLRQPHFKDQLVPVLVDIXQGDPHQWDOSULQ HYDOXDWLRQRUHVWDEOLVKPHQWRIGHVFULSWLYHUHDFWLRQPHFKDQLVPVLVDIXQGDPHQWDOSULQ
FLSOHIRUWKHHYDOXDWLRQRIDYDLODEOHDQGWKHGHVLJQRIQHZFRUURVLRQFRXQWHUPHDVXUHV FLSOHIRUWKHHYDOXDWLRQRIDYDLODEOHDQGWKHGHVLJQRIQHZFRUURVLRQFRXQWHUPHDVXUHV
7KHDIILQLW\RIUHDFWLRQVFDQEHDVVHVVHGEDVHGRQHYDOXDWLQJWKHHTXLOLEULXPSRWHQWLDO 7KHDIILQLW\RIUHDFWLRQVFDQEHDVVHVVHGEDVHGRQHYDOXDWLQJWKHHTXLOLEULXPSRWHQWLDO
µ(¶IRUKDOIFHOOUHDFWLRQVDQGWKH*LEEVIUHHHQHUJ\FKDQJHµ¨*¶IRUFKHPLFDOUHDF µ(¶IRUKDOIFHOOUHDFWLRQVDQGWKH*LEEVIUHHHQHUJ\FKDQJHµ¨*¶IRUFKHPLFDOUHDF
WLRQV FI&KDSWHUµ7D'¶ 7KHVHWZRFRQFHSWVDUHUHJDUGHGDVFHQWUDOIRUDWKHUPRG\ WLRQV FI&KDSWHUµ7D'¶ 7KHVHWZRFRQFHSWVDUHUHJDUGHGDVFHQWUDOIRUDWKHUPRG\
QDPLFDOO\FRQVLVWHQWGHVFULSWLRQRIFRUURVLRQSURFHVVHV7KHWKHRUHWLFDOEDFNJURXQGV QDPLFDOO\FRQVLVWHQWGHVFULSWLRQRIFRUURVLRQSURFHVVHV7KHWKHRUHWLFDOEDFNJURXQGV
WRµ(¶DQGµ¨*¶DUHJLYHQLQ6HFWLRQVDQGUHVSHFWLYHO\ WRµ(¶DQGµ¨*¶DUHJLYHQLQ6HFWLRQVDQGUHVSHFWLYHO\
7KH EHQHILWV RI UHDFWLRQ PHFKDQLVPV LQ GHVFULELQJ FRUURVLRQ SURFHVVHV DQG WKH SUR 7KH EHQHILWV RI UHDFWLRQ PHFKDQLVPV LQ GHVFULELQJ FRUURVLRQ SURFHVVHV DQG WKH SUR
SRVHGWHUPLQRORJ\ XVHG WRUHIHUWRUHDFWLRQV FI &KDSWHUµ7D'¶  DUH H[HPSOLILHGE\ SRVHG WHUPLQRORJ\ XVHG WR UHIHU WR UHDFWLRQV FI &KDSWHU µ7D'¶  DUH H[HPSOLILHGE\
PHDQV RI D IUHTXHQWO\ FLWHG UHGR[ UHDFWLRQ GHVFULELQJ WKH DWPRVSKHULF FRUURVLRQ RI PHDQV RI D IUHTXHQWO\ FLWHG UHGR[ UHDFWLRQ GHVFULELQJ WKH DWPRVSKHULF FRUURVLRQ RI
LURQWRIRUPKHPDWLWH )H2  LURQWRIRUPKHPDWLWH )H2 

)H + 2  → )H  2 ( Δ* 
= −  N- )  >@ )H + 2  → )H  2 ( Δ* 
= −  N- )  >@

7KLV UHGR[ UHDFWLRQ GRHV QRW LOOXVWUDWH ZKDW LV DFWXDOO\ WDNLQJ SODFH DW WKH PHWDO 7KLV UHGR[ UHDFWLRQ GRHV QRW LOOXVWUDWH ZKDW LV DFWXDOO\ WDNLQJ SODFH DW WKH PHWDO
HOHFWURO\WHLQWHUIDFHLHWKHGHWDLOHGUHDFWLRQPHFKDQLVP7KHUHDFWLRQGRHVQRWRFFXU HOHFWURO\WHLQWHUIDFHLHWKHGHWDLOHGUHDFWLRQPHFKDQLVP7KHUHDFWLRQGRHVQRWRFFXU
E\DGLUHFWUHDFWLRQEHWZHHQR[\JHQDQGLURQDWRPV DVHJLQFRPEXVWLRQUHDFWLRQV  E\DGLUHFWUHDFWLRQEHWZHHQR[\JHQDQGLURQDWRPV DVHJLQFRPEXVWLRQUHDFWLRQV 
EXWE\HOHFWURQWUDQVIHUIURPWKHPHWDOWRWKHZDWHU,QWKLV6HFWLRQLWLVGHPRQVWUDWHG EXWE\HOHFWURQWUDQVIHUIURPWKHPHWDOWRWKHZDWHU,QWKLV6HFWLRQLWLVGHPRQVWUDWHG
KRZWKHUHGR[UHDFWLRQFDQEHEURNHQGRZQLQLWVFRQVWLWXHQWUHDFWLRQVWRDVVHVVWKH KRZWKHUHGR[UHDFWLRQFDQEHEURNHQGRZQLQLWVFRQVWLWXHQWUHDFWLRQVWRDVVHVVWKH
GHWDLOHGUHDFWLRQPHFKDQLVP GHWDLOHGUHDFWLRQPHFKDQLVP
+DOIFHOOUHDFWLRQVGHVFULEHHLWKHUWKHJDLQRIHOHFWURQVZKLFKLVUHIHUUHGWRDVUHGXF +DOIFHOOUHDFWLRQVGHVFULEHHLWKHUWKHJDLQRIHOHFWURQVZKLFKLVUHIHUUHGWRDVUHGXF
WLRQRUWKHORVVRIHOHFWURQVZKLFKLVUHIHUUHGWRDVR[LGDWLRQ  WLRQRUWKHORVVRIHOHFWURQVZKLFKLVUHIHUUHGWRDVR[LGDWLRQ 
‡ 5HGXFWLRQ$QR[LGDQWLVUHGXFHGLHWKHR[LGDWLRQVWDWHLVGHFUHDVHG DQGHOHF ‡ 5HGXFWLRQ$QR[LGDQWLVUHGXFHGLHWKHR[LGDWLRQVWDWHLVGHFUHDVHG DQGHOHF
WURQVDUHJDLQHG  WURQVDUHJDLQHG 
‡ 2[LGDWLRQ$UHGXFWDQWLVR[LGLVHGLHWKHR[LGDWLRQVWDWHLVLQFUHDVHG DQGHOHF ‡ 2[LGDWLRQ$UHGXFWDQWLVR[LGLVHGLHWKHR[LGDWLRQVWDWHLVLQFUHDVHG DQGHOHF
WURQVDUHORVW  WURQVDUHORVW 
1HLWKHUR[LGDWLRQQRUUHGXFWLRQFDQEHUHDOLVHGDORQH LQFRQGHQVHGPDWWHU 7KHUH 1HLWKHUR[LGDWLRQQRUUHGXFWLRQFDQEHUHDOLVHGDORQH LQFRQGHQVHGPDWWHU 7KHUH
GXFWLRQPXVWQHFHVVDULO\FRQVXPHWKHHOHFWURQVSURGXFHGE\WKHR[LGDWLRQ7KXVWKH GXFWLRQPXVWQHFHVVDULO\FRQVXPHWKHHOHFWURQVSURGXFHGE\WKHR[LGDWLRQ7KXVWKH
R[LGDWLRQUHDFWLRQPXVWDOZD\VEHFRXSOHGWRDQGEDODQFHGE\WKHUHGXFWLRQUHDFWLRQ R[LGDWLRQUHDFWLRQPXVWDOZD\VEHFRXSOHGWRDQGEDODQFHGE\WKHUHGXFWLRQUHDFWLRQ
7KHHOHFWURGH RUVLWHRQWKHVXUIDFH ZKHUHR[LGDWLRQWDNHVSODFHLVUHIHUUHGWRDVDQ 7KHHOHFWURGH RUVLWHRQWKHVXUIDFH ZKHUHR[LGDWLRQWDNHVSODFHLVUHIHUUHGWRDVDQ

 

$OWKRXJKQRWWUXO\FRUUHFWWKHVHGHILQLWLRQVDUHVXIILFLHQWIRUWKHVFRSHRIWKLVWKHVLV2[LGDWLRQDQG $OWKRXJKQRWWUXO\FRUUHFWWKHVHGHILQLWLRQVDUHVXIILFLHQWIRUWKHVFRSHRIWKLVWKHVLV2[LGDWLRQDQG
UHGXFWLRQSURSHUO\UHIHUWRDFKDQJHLQR[LGDWLRQVWDWHZKHUHDVWKHDFWXDOWUDQVIHURIHOHFWURQVPD\ UHGXFWLRQSURSHUO\UHIHUWRDFKDQJHLQR[LGDWLRQVWDWHZKHUHDVWKHDFWXDOWUDQVIHURIHOHFWURQVPD\
QRWRFFXUDVHJIRUFRYDOHQWERQGV QRWRFFXUDVHJIRUFRYDOHQWERQGV

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

RGH RUDQRGLFVLWH DQGWKHHOHFWURGH RUVLWHRQWKHVXUIDFH ZKHUHUHGXFWLRQWDNHV RGH RU DQRGLFVLWH DQGWKHHOHFWURGH RUVLWHRQWKHVXUIDFH ZKHUHUHGXFWLRQWDNHV
SODFHLVUHIHUUHGWRDVFDWKRGH RUFDWKRGLFVLWH  SODFHLVUHIHUUHGWRDVFDWKRGH RUFDWKRGLFVLWH 
7KH UHGR[ UHDFWLRQ >@ FRPSULVHV WKH EHORZ KDOIFHOO UHDFWLRQV ZKLFK SURYLGH D 7KH UHGR[ UHDFWLRQ >@ FRPSULVHV WKH EHORZ KDOIFHOO UHDFWLRQV ZKLFK SURYLGH D
PRUHDFFXUDWHGHVFULSWLRQRIWKHDFWXDOUHDFWLRQPHFKDQLVP PRUHDFFXUDWHGHVFULSWLRQRIWKHDFWXDOUHDFWLRQPHFKDQLVP
,URQLVILUVWR[LGLVHGWRIHUURXVLRQ )H GHVFULEHGE\WKHKDOIFHOOUHDFWLRQ ,URQLVILUVWR[LGLVHGWRIHUURXVLRQ )H GHVFULEHGE\WKHKDOIFHOOUHDFWLRQ

)H → )H + + H − (( 
 −  {−} P96+( )  >@ )H → )H + + H − (( 
 −  {−} P96+( )  >@

)HUURXVLRQLVIXUWKHUR[LGLVHGWRIHUULFLRQ )H DFFRUGLQJWRWKHKDOIFHOOUHDFWLRQ )HUURXVLRQLVIXUWKHUR[LGLVHGWRIHUULFLRQ )H DFFRUGLQJWRWKHKDOIFHOOUHDFWLRQ

)H  + → )H+ + H− (( 
 =  {} P96+( )  >@ )H  + → )H+ + H− (( 
 =  {} P96+( )  >@

7KH KDOIFHOO UHDFWLRQV >@ DQG >@ DUH DOVR UHIHUUHG WR DV DQRGLF UHDFWLRQV ,W 7KH KDOIFHOO UHDFWLRQV >@ DQG >@ DUH DOVR UHIHUUHG WR DV DQRGLF UHDFWLRQV ,W
VKRXOGEHQRWHGWKDWLURQFDQH[LVWLQWZRR[LGDWLRQVWDWHV³´DQG³´ VKRXOGEHQRWHGWKDWLURQFDQH[LVWLQWZRR[LGDWLRQVWDWHV³´DQG³´
7KHHOHFWURQVWKDWZHUHSURGXFHGE\WKHVHWZRDQRGLFUHDFWLRQVDUHFRQVXPHGE\WKH 7KHHOHFWURQVWKDWZHUHSURGXFHGE\WKHVHWZRDQRGLFUHDFWLRQVDUHFRQVXPHGE\WKH
KDOIFHOOUHDFWLRQGHVFULELQJWKHUHGXFWLRQRIGLVVROYHGR[\JHQLQQHXWUDODQGDONDOLQH KDOIFHOOUHDFWLRQGHVFULELQJWKHUHGXFWLRQRIGLVVROYHGR[\JHQLQQHXWUDODQGDONDOLQH
VROXWLRQVLHLQQHXWUDOZDWHU VROXWLRQVLHLQQHXWUDOZDWHU

2  + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@ 2  + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@

7KHKDOIFHOOUHDFWLRQ>@LVDOVRUHIHUUHGWRDVFDWKRGLFUHDFWLRQ 7KHKDOIFHOOUHDFWLRQ>@LVDOVRUHIHUUHGWRDVFDWKRGLFUHDFWLRQ
,W VKRXOG EH UHPDUNHG WKDW ZDWHU LV QRW RQO\ UHTXLUHG IRU WKH FDWKRGLF UHDFWLRQ EXW ,W VKRXOG EH UHPDUNHG WKDW ZDWHU LV QRW RQO\ UHTXLUHG IRU WKH FDWKRGLF UHDFWLRQ EXW
DOVRDVWKHFDUULHUIRUWKHFDWLRQVSURGXFHGLQWKHDQRGLFUHDFWLRQLHWKHIHUURXVDQG DOVRDVWKHFDUULHUIRUWKHFDWLRQVSURGXFHGLQWKHDQRGLFUHDFWLRQLHWKHIHUURXVDQG
WKHIHUULFLRQ WKHIHUULFLRQ
&RPELQLQJ WKH KDOIFHOO UHDFWLRQV >@ >@ DQG >@ DQG EDODQFLQJ WKHP IRU WKH &RPELQLQJ WKH KDOIFHOO UHDFWLRQV >@ >@ DQG >@ DQG EDODQFLQJ WKHP IRU WKH
QXPEHURIHOHFWURQVEHLQJWUDQVIHUUHGWKHIROORZLQJUHGR[UHDFWLRQLVREWDLQHG QXPEHURIHOHFWURQVEHLQJWUDQVIHUUHGWKHIROORZLQJUHGR[UHDFWLRQLVREWDLQHG

)H + 2  + +  2 → )H+ + 2+ − ( Δ* 


= − N- )  >@ )H + 2  + +  2 → )H+ + 2+ − ( Δ* 
= − N- )  >@

7KHIUHH IHUULFLRQV DQG WKHK\GUR[LGHLRQVDUHQRWDFWXDOLQWHUPHGLDWHVEXWGLUHFWO\ 7KHIUHH IHUULFLRQV DQG WKHK\GUR[LGHLRQVDUHQRWDFWXDOLQWHUPHGLDWHVEXWGLUHFWO\


IRUPDPRUHVWDEOHSKDVHXQGHUWKHOLEHUDWLRQRIZDWHU$VIHUULFLRQDQGKHPDWLWHDUH IRUPDPRUHVWDEOHSKDVHXQGHUWKHOLEHUDWLRQRIZDWHU$VIHUULFLRQDQGKHPDWLWHDUH
LQWKHVDPHR[LGDWLRQVWDWHWKLVLVGHVFULEHGE\WKHDFLGEDVHUHDFWLRQ LQWKHVDPHR[LGDWLRQVWDWHWKLVLVGHVFULEHGE\WKHDFLGEDVHUHDFWLRQ

)H+ + 2+ − → )H  2 + +  2 ( Δ* 
= −  N- )  >@ )H+ + 2+ − → )H  2 + +  2 ( Δ* 
= −  N- )  >@

,QVHUWLQJ>@LQWR>@OHDGVWR ,QVHUWLQJ>@LQWR>@OHDGVWR

)H + 2  + +  2 → )H  2 + +  2 ( Δ* 
= −  N- )  >@ )H + 2  + +  2 → )H  2 + +  2 ( Δ* 
= −  N- )  >@

ZKLFKFRUUHVSRQGVWRWKHRULJLQDOUHGR[UHDFWLRQ>@ ZKLFKFRUUHVSRQGVWRWKHRULJLQDOUHGR[UHDFWLRQ>@
,QWKLVZD\WKHUHDFWLRQPHFKDQLVPWKDWUHIOHFWVWKHDFWXDOSURFHVVVXPPDULVHGE\WKH ,QWKLVZD\WKHUHDFWLRQPHFKDQLVPWKDWUHIOHFWVWKHDFWXDOSURFHVVVXPPDULVHGE\WKH
UHGR[UHDFWLRQ>@ EXWLVQRWDFFHVVLEOHWKURXJKWKHVDPH FDQEHHYDOXDWHGVWHSE\ UHGR[UHDFWLRQ>@ EXWLVQRWDFFHVVLEOHWKURXJKWKHVDPH FDQEHHYDOXDWHGVWHSE\
VWHS$VH[SODLQHGLQPRUHGHWDLOLQ6HFWLRQDQG6HFWLRQWKHVWHSE\VWHS VWHS$VH[SODLQHGLQPRUHGHWDLOLQ6HFWLRQDQG6HFWLRQWKHVWHSE\VWHS
UHDFWLRQ PHFKDQLVP FDQ DOVR EH WKHUPRG\QDPLFDOO\ YHULILHG ZLWK UHJDUG WR WKH UHDFWLRQ PHFKDQLVP FDQ DOVR EH WKHUPRG\QDPLFDOO\ YHULILHG ZLWK UHJDUG WR WKH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

LQYROYHG PDJQLWXGHV RI µ¨*¶ DQG µ(¶ %DVHG RQ VXFK YHUILFDWLRQ WKLV UHDFWLRQ LQYROYHG PDJQLWXGHV RI µ¨*¶ DQG µ(¶ %DVHG RQ VXFK YHUILFDWLRQ WKLV UHDFWLRQ
PHFKDQLVP FDQ EH FRQVLGHUHG WR EH D UHDVRQDEOH GHVFULSWLRQ RI WKH LQYHVWLJDWHG PHFKDQLVP FDQ EH FRQVLGHUHG WR EH D UHDVRQDEOH GHVFULSWLRQ RI WKH LQYHVWLJDWHG
FRUURVLRQSURFHVV,Q&KDSWHUVHOHFWHGH[DPSOHVIURPWKHOLWHUDWXUHVKRZWKDWPDQ\ FRUURVLRQSURFHVV,Q&KDSWHUVHOHFWHGH[DPSOHVIURPWKHOLWHUDWXUHVKRZWKDWPDQ\
UHDFWLRQVRUUHDFWLRQPHFKDQLVPVZKLFKKDYHEHHQSRVWXODWHGIRUWKHGHVFULSWLRQRI UHDFWLRQVRUUHDFWLRQPHFKDQLVPVZKLFKKDYHEHHQSRVWXODWHGIRUWKHGHVFULSWLRQRI
GLIIHUHQW UHLQIRUFHPHQW FRUURVLRQ SKHQRPHQD GR QRW IXOOILO WKHVH IXQGDPHQWDO GLIIHUHQW UHLQIRUFHPHQW FRUURVLRQ SKHQRPHQD GR QRW IXOOILO WKHVH IXQGDPHQWDO
WKHUPRG\QDPLFUHTXLUHPHQWV WKHUPRG\QDPLFUHTXLUHPHQWV
%HVLGHVWKDWWKHRULJLQDOUHGR[UHDFWLRQ>@GRHVQRWLOOXVWUDWHWKHGHWDLOHGUHDFWLRQ %HVLGHVWKDWWKHRULJLQDOUHGR[UHDFWLRQ>@GRHVQRWLOOXVWUDWHWKHGHWDLOHGUHDFWLRQ
PHFKDQLVPLWLQGLFDWHVDIXUWKHUSUREOHPRIVXFKGHVFULSWLRQV)H2LVQRWRQO\WKH PHFKDQLVPLWLQGLFDWHVDIXUWKHUSUREOHPRIVXFKGHVFULSWLRQV)H2LVQRWRQO\WKH
SULQFLSDOFRPSRXQGIRUPHGLQDFWLYHFRUURVLRQDVWKHXQGHVLUDEOHFRUURVLRQSURGXFW SULQFLSDOFRPSRXQGIRUPHGLQDFWLYHFRUURVLRQDVWKHXQGHVLUDEOHFRUURVLRQSURGXFW
FRPPRQO\NQRZQDVUHGUXVWEXWLWDOVRLVWKHPDMRUFRQWULEXWRUWRWKHJHQHUDOO\GH FRPPRQO\NQRZQDVUHGUXVWEXWLWDOVRLVWKHPDMRUFRQWULEXWRUWRWKHJHQHUDOO\GH
VLUHG SDVVLYDWLRQ DQG KHQFH WR WKH SDVVLYH VWDWH RI LURQ RU VWHHO  LQ DONDOLQH PHGLD VLUHG SDVVLYDWLRQ DQG KHQFH WR WKH SDVVLYH VWDWH RI LURQ RU VWHHO  LQ DONDOLQH PHGLD
VXFK DV XQFRQWDPLQDWHG FRQFUHWH $PRQJ RWKHUV WKH WKHUPRG\QDPLF GLIIHUHQWLDWLRQ VXFK DV XQFRQWDPLQDWHG FRQFUHWH $PRQJ RWKHUV WKH WKHUPRG\QDPLF GLIIHUHQWLDWLRQ
EHWZHHQWKHSURGXFWVIRUPHGLQWKHVHWZRVWDWHVLHWKHDFWLYHFRUURVLRQDQGWKHSDV EHWZHHQWKHSURGXFWVIRUPHGLQWKHVHWZRVWDWHVLHWKHDFWLYHFRUURVLRQDQGWKHSDV
VLYH VWDWH DQG WKHLU FRQVHTXHQFHV LQ DTXHRXV FRUURVLRQ V\VWHPV RI VWHHO DQG RWKHU VLYH VWDWH DQG WKHLU FRQVHTXHQFHV LQ DTXHRXV FRUURVLRQ V\VWHPV RI VWHHO DQG RWKHU
PHWDOVDUHDFHQWUDODVSHFWLQWKLVWKHVLV PHWDOVDUHDFHQWUDODVSHFWLQWKLVWKHVLV

 $QRGLFDQG&DWKRGLF5HDFWLRQV  $QRGLFDQG&DWKRGLF5HDFWLRQV


,QDTXHRXVPHWDOOLFFRUURVLRQWKHDQRGLFUHDFWLRQLVLQYDULDEO\LQWKHIRUPRIDQR[L ,QDTXHRXVPHWDOOLFFRUURVLRQWKHDQRGLFUHDFWLRQLVLQYDULDEO\LQWKHIRUPRIDQR[L
GDWLRQUHDFWLRQ GDWLRQUHDFWLRQ

0H → 0H Q + + QH−  >@ 0H → 0H Q + + QH−  >@

ZLWKµ0H¶DVDQDUELWUDU\PHWDODQGµQ¶DVWKHR[LGDWLRQVWDWHRIWKHPHWDOµ0H¶µ0H¶ ZLWKµ0H¶DVDQDUELWUDU\PHWDODQGµQ¶DVWKHR[LGDWLRQVWDWHRIWKHPHWDOµ0H¶µ0H¶
FDQDOVRUHSUHVHQWDQ\FRPSRXQGRIWKHPHWDOZKLOHµ0HQ¶UHSUHVHQWVDQ\FRPSRXQG FDQDOVRUHSUHVHQWDQ\FRPSRXQGRIWKHPHWDOZKLOHµ0HQ¶UHSUHVHQWVDQ\FRPSRXQG
RI WKH VDPH PHWDO LQ D KLJKHU R[LGDWLRQ VWDWH 7KLV LQFOXGHV WKDWWKHDQRGLFUHDFWLRQ RI WKH VDPH PHWDO LQ D KLJKHU R[LGDWLRQ VWDWH 7KLV LQFOXGHV WKDWWKHDQRGLFUHDFWLRQ
FDQIRUPDQ\R[LGHK\GUR[LGHRUDQ\RWKHUR[LGLVHGFRPSRXQGRIWKHPHWDODVHJ FDQIRUPDQ\R[LGHK\GUR[LGHRUDQ\RWKHUR[LGLVHGFRPSRXQGRIWKHPHWDODVHJ
LOOXVWUDWHGE\WKHR[LGDWLRQRILURQWRPDJQHWLWH )H2  LOOXVWUDWHGE\WKHR[LGDWLRQRILURQWRPDJQHWLWH )H2 

)H + +  2 → )H2  + + + + H − (( 
 = −  P96+( )  >@ )H + +  2 → )H2  + + + + H − (( 
 = −  P96+( )  >@

7KXVDQRGLFUHDFWLRQSURGXFWVDUHQRWDWDOOOLPLWHGWRWKHIRUPDWLRQRIGLVVROYHGLRQV 7KXVDQRGLFUHDFWLRQSURGXFWVDUHQRWDWDOOOLPLWHGWRWKHIRUPDWLRQRIGLVVROYHGLRQV
VXFKDV)HRU)H FIKDOIFHOOUHDFWLRQV>@DQG>@LQ6HFWLRQ EXWYDUL VXFKDV)HRU)H FIKDOIFHOOUHDFWLRQV>@DQG>@LQ6HFWLRQ EXWYDUL
RXV FRPSRXQGV FDQ EH IRUPHG 7KLV DVSHFW ZKLFK DSSHDUV WR EH QRW RU RQO\ SDUWO\ RXV FRPSRXQGV FDQ EH IRUPHG 7KLV DVSHFW ZKLFK DSSHDUV WR EH QRW RU RQO\ SDUWO\
DFNQRZOHGJHGLQPRVWWH[WERRNVRQUHLQIRUFHPHQWFRUURVLRQLVDFHQWUDODVSHFWLQRXU DFNQRZOHGJHGLQPRVWWH[WERRNVRQUHLQIRUFHPHQWFRUURVLRQLVDFHQWUDODVSHFWLQRXU
WKHUPRG\QDPLF FRQVLGHUDWLRQV 3URGXFWV IRUPHG E\ DQRGLF UHDFWLRQV DUH GHDOW ZLWK WKHUPRG\QDPLF FRQVLGHUDWLRQV 3URGXFWV IRUPHG E\ DQRGLF UHDFWLRQV DUH GHDOW ZLWK
WKURXJKRXWWKLVWKHVLVZKLOHWKHPRVWLPSRUWDQWDVSHFWVDUHUHDVRQHGLQ&KDSWHUDQG WKURXJKRXWWKLVWKHVLVZKLOHWKHPRVWLPSRUWDQWDVSHFWVDUHUHDVRQHGLQ&KDSWHUDQG
GLVFXVVHGLQGHWDLOZLWKIRFXVRQUHLQIRUFHPHQWFRUURVLRQLQ&KDSWHU GLVFXVVHGLQGHWDLOZLWKIRFXVRQUHLQIRUFHPHQWFRUURVLRQLQ&KDSWHU
,QWKHFRUURVLRQOLWHUDWXUHLWLVRIWHQUHPDUNHGWKDWKDOIFHOOUHDFWLRQVGHVFULELQJFD ,QWKHFRUURVLRQOLWHUDWXUHLWLVRIWHQUHPDUNHGWKDWKDOIFHOOUHDFWLRQVGHVFULELQJFD
WKRGLFUHDFWLRQVDUHIHZLQQXPEHU 7KHJHQHUDOO\VWDWHGFDWKRGLFUHDFWLRQVFRPSULVH WKRGLFUHDFWLRQVDUHIHZLQQXPEHU 7KHJHQHUDOO\VWDWHGFDWKRGLFUHDFWLRQVFRPSULVH

 

,QFRQWUDVWWRRWKHUHOHFWURFKHPLFDOGLVFLSOLQHV HJHOHFWURSODWLQJFI6HFWLRQ ZKHUHWKHGH ,QFRQWUDVWWRRWKHUHOHFWURFKHPLFDOGLVFLSOLQHV HJHOHFWURSODWLQJFI6HFWLRQ ZKHUHWKHGH
VLUHGFDWKRGLFUHDFWLRQVLQFOXGH0HQQHíĺ0H VLUHGFDWKRGLFUHDFWLRQVLQFOXGH0HQQHíĺ0H

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

‡ 5HGXFWLRQRIR[\JHQLQDFLGVROXWLRQV ‡ 5HGXFWLRQRIR[\JHQLQDFLGVROXWLRQV

 2  + + + + H − → +  2 (( 
 =  {} P96+( )  >@  2  + + + + H − → +  2 (( 
 =  {} P96+( )  >@

‡ 5HGXFWLRQRIR[\JHQLQQHXWUDODQGDONDOLQHVROXWLRQV ‡ 5HGXFWLRQRIR[\JHQLQQHXWUDODQGDONDOLQHVROXWLRQV

 2  + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@  2  + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@

‡ 5HGXFWLRQRIK\GURJHQLRQ K\GURJHQHYROXWLRQ LQDFLGVROXWLRQV ‡ 5HGXFWLRQRIK\GURJHQLRQ K\GURJHQHYROXWLRQ LQDFLGVROXWLRQV

 + + + H− → +  (( 
 =  P96+( )  >@  + + + H− → +  (( 
 =  P96+( )  >@

‡ 5HGXFWLRQRIZDWHU K\GURJHQHYROXWLRQ LQQHXWUDODQGDONDOLQHVROXWLRQV LQDE ‡ 5HGXFWLRQRIZDWHU K\GURJHQHYROXWLRQ LQQHXWUDODQGDONDOLQHVROXWLRQV LQDE


VHQFHRIDOORWKHUFDWKRGLFUHDFWLRQV  VHQFHRIDOORWKHUFDWKRGLFUHDFWLRQV 

 +  2 + H − → +  + 2+ − (( 
 = −  ^−` P96+( )  >@  +  2 + H − → +  + 2+ − (( 
 = −  ^−` P96+( )  >@

%RWKWHUPVUHGXFWLRQRIK\GURJHQLRQK\GURJHQLRQUHGXFWLRQDQGK\GURJHQHYROXWLRQ %RWKWHUPVUHGXFWLRQRIK\GURJHQLRQK\GURJHQLRQUHGXFWLRQDQGK\GURJHQHYROXWLRQ
DUHXVHGWKURXJKRXWWKLVWKHVLV+\GURJHQHYROXWLRQ LQWKHOLWHUDWXUHDOVRUHIHUUHGWR DUHXVHGWKURXJKRXWWKLVWKHVLV+\GURJHQHYROXWLRQ LQWKHOLWHUDWXUHDOVRUHIHUUHGWR
DVK\GURJHQGHYHORSPHQWRUK\GURJHQIRUPDWLRQ LVXVHGLIWKHHYROXWLRQRIK\GURJHQ DVK\GURJHQGHYHORSPHQWRUK\GURJHQIRUPDWLRQ LVXVHGLIWKHHYROXWLRQRIK\GURJHQ
LVRIFRQFHUQUDWKHUWKDQWKHFDWKRGLFDFWLRQ FIKDOIFHOOUHDFWLRQV>@DQG>@  LVRIFRQFHUQUDWKHUWKDQWKHFDWKRGLFDFWLRQ FIKDOIFHOOUHDFWLRQV>@DQG>@ 
,WVKRXOGEHQRWHGWKDWIURPDWKHUPRG\QDPLFSRLQWRIYLHZHYHU\UHGXFWLRQUHDFWLRQ ,WVKRXOGEHQRWHGWKDWIURPDWKHUPRG\QDPLFSRLQWRIYLHZHYHU\UHGXFWLRQUHDFWLRQ
HJLQDQDORJ\WRWKHKDOIFHOOUHDFWLRQ>@FDQEHFRQVLGHUHGDVDSRVVLEOHFDWKRGLF HJLQDQDORJ\WRWKHKDOIFHOOUHDFWLRQ>@FDQEHFRQVLGHUHGDVDSRVVLEOHFDWKRGLF
UHDFWLRQ UHDFWLRQ

)H2  + + + + H− → )H + +  2 (( 


 = −  P96+( )  >@ )H2  + + + + H− → )H + +  2 (( 
 = −  P96+( )  >@

6RLQSULQFLSOHDQ\DQRGLFUHDFWLRQFDQEHUHYHUVHGLQWRWKHUHGXFWLRQGLUHFWLRQDQG 6RLQSULQFLSOHDQ\DQRGLFUHDFWLRQFDQEHUHYHUVHGLQWRWKHUHGXFWLRQGLUHFWLRQDQG
DFW DV FDWKRGLF UHDFWLRQ LI WKH WKHUPRG\QDPLF FRQGLWLRQV DUH SUHVHQW <HW NLQHWLFV DFW DV FDWKRGLF UHDFWLRQ LI WKH WKHUPRG\QDPLF FRQGLWLRQV DUH SUHVHQW <HW NLQHWLFV
OLPLWVWKHUHGXFWLRQRIR[LGHVDQGK\GUR[LGHVWRDODUJHH[WHQWDVLVUHDVRQHGLQ6HF OLPLWVWKHUHGXFWLRQRIR[LGHVDQGK\GUR[LGHVWRDODUJHH[WHQWDVLVUHDVRQHGLQ6HF
WLRQ  DQG ZLWK SDUWLFXODU UHJDUG WR UHLQIRUFHPHQW FRUURVLRQ WKURXJKRXW &KDS WLRQ  DQG ZLWK SDUWLFXODU UHJDUG WR UHLQIRUFHPHQW FRUURVLRQ WKURXJKRXW &KDS
WHU:HVXJJHVWKRZHYHUWKDWUHGXFWLRQRIVROXEOHVSHFLHVVXFKDVUHGXFWLRQRIIHU WHU:HVXJJHVWKRZHYHUWKDWUHGXFWLRQRIVROXEOHVSHFLHVVXFKDVUHGXFWLRQRIIHU
ULFLRQWRIHUURXVLRQ FI>@LQ6HFWLRQ LVNLQHWLFDOO\IDYRXUHG ULFLRQWRIHUURXVLRQ FI>@LQ6HFWLRQ LVNLQHWLFDOO\IDYRXUHG

)H+ + H − → )H  + (( 
 =  {} P96+( )  >@ )H+ + H − → )H  + (( 
 =  {} P96+( )  >@

1HYHUWKHOHVV FRPSDUHG WR WKH PDJQLWXGH RI WKH FDWKRGLF UHDFWLRQV >@ WR >@ 1HYHUWKHOHVV FRPSDUHG WR WKH PDJQLWXGH RI WKH FDWKRGLF UHDFWLRQV >@ WR >@
UHGXFWLRQRIR[LGLVHGLRQVJHQHUDOO\KDVLQFRUURVLRQDVPDOOHUFRQWULEXWLRQWRWKHFD UHGXFWLRQRIR[LGLVHGLRQVJHQHUDOO\KDVLQFRUURVLRQDVPDOOHUFRQWULEXWLRQWRWKHFD
WKRGLFSURFHVVHV7KLVDQGRWKHUDVSHFWV FRQFHUQLQJFDWKRGLFUHDFWLRQV DQG WKHLU GR WKRGLFSURFHVVHV7KLVDQGRWKHUDVSHFWV FRQFHUQLQJFDWKRGLFUHDFWLRQV DQG WKHLU GR
PDLQVDUHGHDOWZLWKWKURXJKRXWWKLVWKHVLVLQSDUWLFXODULQ6HFWLRQVDVZHOODV PDLQVDUHGHDOWZLWKWKURXJKRXWWKLVWKHVLVLQSDUWLFXODULQ6HFWLRQVDVZHOODV
LQ&KDSWHUVDQG LQ&KDSWHUVDQG

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

 *LEEV)UHH(QHUJ\  *LEEV)UHH(QHUJ\


7KH GULYLQJ IRUFH IRU DQ\ FKHPLFDO UHDFWLRQ RFFXUULQJ XQGHU FRQGLWLRQV RI FRQVWDQW 7KH GULYLQJ IRUFH IRU DQ\ FKHPLFDO UHDFWLRQ RFFXUULQJ XQGHU FRQGLWLRQV RI FRQVWDQW
WHPSHUDWXUHDQGSUHVVXUHFDQEHPHDVXUHGE\WKHQHJDWLYH*LEEVIUHHHQHUJ\ FKDQJH WHPSHUDWXUHDQGSUHVVXUHFDQEHPHDVXUHGE\WKHQHJDWLYH*LEEVIUHHHQHUJ\ FKDQJH
µ¨*¶ZKLFKDFFRPSDQLHVWKHWUDQVIRUPDWLRQRIWKHUHDFWDQWVWRWKHSURGXFWV µ¨*¶ZKLFKDFFRPSDQLHVWKHWUDQVIRUPDWLRQRIWKHUHDFWDQWVWRWKHSURGXFWV
µ¨*¶FDQEHGHILQHGDVIROORZV>%DUGDO@ µ¨*¶FDQEHGHILQHGDVIROORZV>%DUGDO@
³:KHQ D V\VWHP LV WUDQVIHUUHG WR RQH VWDWH IURP DQRWKHU DW FRQVWDQW SUHVVXUH DQG ³:KHQ D V\VWHP LV WUDQVIHUUHG WR RQH VWDWH IURP DQRWKHU DW FRQVWDQW SUHVVXUH DQG
WHPSHUDWXUHLWLVVXEMHFWHGWRDFKDQJHRIIUHHHQWKDOS\ RU*LEEVIUHHHQHUJ\ JLYHQ WHPSHUDWXUHLWLVVXEMHFWHGWRDFKDQJHRIIUHHHQWKDOS\ RU*LEEVIUHHHQHUJ\ JLYHQ
E\µ¨*¶ í PD[LPXPZRUNDYDLODEOHIURPWKHV\VWHPWKURXJKWKHVWDWHWUDQVLWLRQ  E\µ¨*¶ í PD[LPXPZRUNDYDLODEOHIURPWKHV\VWHPWKURXJKWKHVWDWHWUDQVLWLRQ 
ZKHQWKLVZRUNLVJLYHQDSRVLWLYHVLJQ´ ZKHQWKLVZRUNLVJLYHQDSRVLWLYHVLJQ´
7KHV\VWHPWHQGVWRWUDQVIRUPWRDORZHUHQHUJ\OHYHOE\LWVHOILHDQHWUHDFWLRQWKDW 7KHV\VWHPWHQGVWRWUDQVIRUPWRDORZHUHQHUJ\OHYHOE\LWVHOILHDQHWUHDFWLRQWKDW
RFFXUVZLWKRXWDQ\VXSSO\RIHQHUJ\LVDFFRPSDQLHGE\DQHJDWLYHµ¨*¶$FFRUGLQJO\ RFFXUVZLWKRXWDQ\VXSSO\RIHQHUJ\LVDFFRPSDQLHGE\DQHJDWLYHµ¨*¶$FFRUGLQJO\
WKHPHDQLQJRIWKHVLJQRIµ¨*¶FDQEHXQGHUVWRRGDVIROORZV WKHPHDQLQJRIWKHVLJQRIµ¨*¶FDQEHXQGHUVWRRGDVIROORZV
‡ µ¨*¶   PHDQV WKDW WKH V\VWHP FDQ FDUU\ RXW ZRUN DQG UHOHDVHVHQHUJ\ +HQFH ‡ µ¨*¶   PHDQV WKDW WKH V\VWHP FDQ FDUU\ RXW ZRUN DQG UHOHDVHVHQHUJ\ +HQFH
WKHFKHPLFDOUHDFWLRQWKDWGHVFULEHVWKHV\VWHPLVVSRQWDQHRXVDQGLUUHYHUVLEOHLH WKHFKHPLFDOUHDFWLRQWKDWGHVFULEHVWKHV\VWHPLVVSRQWDQHRXVDQGLUUHYHUVLEOHLH
WKHUHDFWLRQLVWKHUPRG\QDPLFDOO\IDYRXUHG WKHUHDFWLRQLVWKHUPRG\QDPLFDOO\IDYRXUHG
‡ µ¨*¶   PHDQV WKH V\VWHP LV DW HTXLOLEULXP +HQFH WKH FKHPLFDO UHDFWLRQ WKDW ‡ µ¨*¶   PHDQV WKH V\VWHP LV DW HTXLOLEULXP +HQFH WKH FKHPLFDO UHDFWLRQ WKDW
GHVFULEHVWKHV\VWHPLVUHYHUVLEOHDQGQHLWKHUWKHIRUZDUGQRUWKHUHYHUVHUHDFWLRQ GHVFULEHVWKHV\VWHPLVUHYHUVLEOHDQGQHLWKHUWKHIRUZDUGQRUWKHUHYHUVHUHDFWLRQ
SUHYDLOV SUHYDLOV
‡ µ¨*¶!PHDQVWKDWHQHUJ\PXVWEHVXSSOLHGWRWKHV\VWHPWRSURFHHG+HQFHWKH ‡ µ¨*¶!PHDQVWKDWHQHUJ\PXVWEHVXSSOLHGWRWKHV\VWHPWRSURFHHG+HQFHWKH
FKHPLFDOUHDFWLRQWKDWGHVFULEHVWKHV\VWHPLVQRQVSRQWDQHRXV7KDWPHDQVWKDWLW FKHPLFDOUHDFWLRQWKDWGHVFULEHVWKHV\VWHPLVQRQVSRQWDQHRXV7KDWPHDQVWKDWLW
SURFHHGV LQ WKH RSSRVLWH GLUHFWLRQ LH WKH UHDFWLRQ LV WKHUPRG\QDPLFDOO\ XQID SURFHHGV LQ WKH RSSRVLWH GLUHFWLRQ LH WKH UHDFWLRQ LV WKHUPRG\QDPLFDOO\ XQID
YRXUHG YRXUHG
,WVKRXOGEHHPSKDVLVHGWKDWWKHUHLVDORWPRUHWKHRU\WRWKHFRQFHSWRIWKH*LEEVIUHH ,WVKRXOGEHHPSKDVLVHGWKDWWKHUHLVDORWPRUHWKHRU\WRWKHFRQFHSWRIWKH*LEEVIUHH
HQHUJ\LQSDUWLFXODUZLWKUHJDUGWRLWVHTXLYDOHQFHVZLWKRWKHUWKHUPRG\QDPLFSRWHQ HQHUJ\LQSDUWLFXODUZLWKUHJDUGWRLWVHTXLYDOHQFHVZLWKRWKHUWKHUPRG\QDPLFSRWHQ
WLDOV VXFK DV LQWHUQDO HQHUJ\ +HOPKROW] IUHH HQHUJ\ DQG HQWKDOS\ FI 6HFWLRQ   WLDOV VXFK DV LQWHUQDO HQHUJ\ +HOPKROW] IUHH HQHUJ\ DQG HQWKDOS\ FI 6HFWLRQ  
7KHWKHRU\EHKLQGWKHVHSDUDPHWHUVLVLQWHQWLRQDOO\RPLWWHGLQWKLV6HFWLRQDVWKH\DUH 7KHWKHRU\EHKLQGWKHVHSDUDPHWHUVLVLQWHQWLRQDOO\RPLWWHGLQWKLV6HFWLRQDVWKH\DUH
³LQGLUHFW´SDUDPHWHUVLQWKHUPRG\QDPLFFDOFXODWLRQVDQGZHUHJDUGWKHUHODWHGWKHRU\ ³LQGLUHFW´SDUDPHWHUVLQWKHUPRG\QDPLFFDOFXODWLRQVDQGZHUHJDUGWKHUHODWHGWKHRU\
WREHPDUJLQDOIRUWKHVFRSHRIWKLVWKHVLV7KHRWKHUWKHUPRG\QDPLFGHILQLWLRQVDQG WREHPDUJLQDOIRUWKHVFRSHRIWKLVWKHVLV7KHRWKHUWKHUPRG\QDPLFGHILQLWLRQVDQG
IXQGDPHQWDOFRUUHODWLRQVDUHKRZHYHUEULHIO\GHDOWZLWKLQ6HFWLRQVLQFHWKH\DUH IXQGDPHQWDOFRUUHODWLRQVDUHKRZHYHUEULHIO\GHDOWZLWKLQ6HFWLRQVLQFHWKH\DUH
UHOHYDQWWRRXUDSSOLFDWLRQRIHJWKHUPRG\QDPLFVRIWZDUH)RUDGHWDLOHGGLVFXVVLRQ UHOHYDQWWRRXUDSSOLFDWLRQRIHJWKHUPRG\QDPLFVRIWZDUH)RUDGHWDLOHGGLVFXVVLRQ
RIWKHFRQFHSWVRI*LEEVIUHHHQHUJ\DQGRWKHUWKHUPRG\QDPLFSRWHQWLDOVUHIHUHQFHLV RIWKHFRQFHSWVRI*LEEVIUHHHQHUJ\DQGRWKHUWKHUPRG\QDPLFSRWHQWLDOVUHIHUHQFHLV
PDGH WR WKH OLWHUDWXUH $PRQJ VWDQGDUG WKHUPRG\QDPLF RU SK\VLFDO FKHPLVWU\ WH[W PDGH WR WKH OLWHUDWXUH $PRQJ VWDQGDUG WKHUPRG\QDPLF RU SK\VLFDO FKHPLVWU\ WH[W
ERRNVUHIHUHQFHLVPDGHWRHJ>)UHLHVOHEHQ+DQVHQ0¡OOHUD@ ERRNVUHIHUHQFHLVPDGHWRHJ>)UHLHVOHEHQ+DQVHQ0¡OOHUD@
,Iµ¨*¶RIDUHDFWLRQLVNQRZQLWLVSRVVLEOHWRSUHGLFWZKHWKHURUQRWWKHUHDFWLRQLV ,Iµ¨*¶RIDUHDFWLRQLVNQRZQLWLVSRVVLEOHWRSUHGLFWZKHWKHURUQRWWKHUHDFWLRQLV
WKHUPRG\QDPLFDOO\ IDYRXUHG :H XVH WKLV VWDWHPHQW RQO\ DV D ³QHJDWLYH LQGLFDWRU´ WKHUPRG\QDPLFDOO\ IDYRXUHG :H XVH WKLV VWDWHPHQW RQO\ DV D ³QHJDWLYH LQGLFDWRU´
LH LI D FKHPLFDO UHDFWLRQ GLVSOD\V D SRVLWLYH µ¨*¶ DQG KHQFH LV WKHUPRG\QDPLFDOO\ LH LI D FKHPLFDO UHDFWLRQ GLVSOD\V D SRVLWLYH µ¨*¶ DQG KHQFH LV WKHUPRG\QDPLFDOO\
XQIDYRXUHGLWLVFRQVLGHUHGLPSRVVLEOHWRWDNHSODFH+RZHYHUQRFOHDUVWDWHPHQWFDQ XQIDYRXUHGLWLVFRQVLGHUHGLPSRVVLEOHWRWDNHSODFH+RZHYHUQRFOHDUVWDWHPHQWFDQ
 

 1DPHGDIWHU-RVLDK:LOODUG*LEEV86$>5REHUJH@  1DPHGDIWHU-RVLDK:LOODUG*LEEV86$>5REHUJH@

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

EHPDGHRQZKHWKHURUQRWDFKHPLFDOUHDFWLRQZLWKDQHJDWLYHµ¨*¶WDNHVSODFHVLQFH EHPDGHRQZKHWKHURUQRWDFKHPLFDOUHDFWLRQZLWKDQHJDWLYHµ¨*¶WDNHVSODFHVLQFH
WKHUHDFWLRQNLQHWLFVSOD\VDQHVVHQWLDOUROHDVZHOO7KLVDOVRH[FOXGHVVWDWHPHQWVRI WKHUHDFWLRQNLQHWLFVSOD\VDQHVVHQWLDOUROHDVZHOO7KLVDOVRH[FOXGHVVWDWHPHQWVRI
WKHSUREDELOLW\RIDUHDFWLRQWRRFFXUEDVHGRQWKHPDJQLWXGHRILWVDVVRFLDWHGµ¨*¶ WKHSUREDELOLW\RIDUHDFWLRQWRRFFXUEDVHGRQWKHPDJQLWXGHRILWVDVVRFLDWHGµ¨*¶
)RUDUHDFWLRQRIWKHW\SH )RUDUHDFWLRQRIWKHW\SH
Y 5 5  +  + Y 5 ] 5 ] → Y 3 3 +  + Y 3] 3]  >@ Y 5 5  +  + Y 5 ] 5 ] → Y 3 3 +  + Y 3] 3]  >@

ZKHUH µY¶ LV WKH VWRLFKLRPHWULF FRHIILFLHQW DQG µ5¶ DQG µ3¶ DUH WKH UHDFWDQWV DQG WKH ZKHUH µY¶ LV WKH VWRLFKLRPHWULF FRHIILFLHQW DQG µ5¶ DQG µ3¶ DUH WKH UHDFWDQWV DQG WKH
SURGXFWVUHVSHFWLYHO\µ¨*¶IRUWKHVWDQGDUGVWDWHµ¨*¶FDQEHFDOFXODWHGDFFRUGLQJ SURGXFWVUHVSHFWLYHO\µ¨*¶IRUWKHVWDQGDUGVWDWHµ¨*¶FDQEHFDOFXODWHGDFFRUGLQJ
WR WR

Δ*  = ¦ Δ* 
I3 − ¦ Δ* I 5 Δ*  = ¦ Δ* 
I3 − ¦ Δ* I 5
 >@  >@
Δ*  (Y 3 ) (
Δ* I 3 +  + Y 3] Δ* I 3] − Y 5 Δ* I 5 +  + Y 5 ] Δ* I 5 ] ) Δ*  (Y 3 ) (
Δ* I 3 +  + Y 3] Δ* I 3] − Y 5 Δ* I 5 +  + Y 5 ] Δ* I 5 ] )
µ¨*I¶RIWKHUHDFWDQWVDQGWKHSURGXFWVLVUHIHUUHGWRDVVWDQGDUG*LEEVIUHHHQHUJ\RI µ¨*I¶RIWKHUHDFWDQWVDQGWKHSURGXFWVLVUHIHUUHGWRDVVWDQGDUG*LEEVIUHHHQHUJ\RI
IRUPDWLRQFKDQJHµ¨*I¶DFFRPSDQLHVWKHIRUPDWLRQRIPRORIDFRPSRXQGIURPLWV IRUPDWLRQFKDQJHµ¨*I¶DFFRPSDQLHVWKHIRUPDWLRQRIPRORIDFRPSRXQGIURPLWV
FRPSRQHQWHOHPHQWVDWWKHLUVWDQGDUGVWDWHV$OOSXUHLVRODWHGHOHPHQWVLQWKHLUVWDQ FRPSRQHQWHOHPHQWVDWWKHLUVWDQGDUGVWDWHV$OOSXUHLVRODWHGHOHPHQWVLQWKHLUVWDQ
GDUGVWDWHV HJ )H 2 DQG+  KDYH Dµ¨*I¶RI]HURDVWKHUHLVQR HQHUJ\ FKDQJH GDUGVWDWHV HJ )H 2 DQG+  KDYH Dµ¨*I¶RI]HURDVWKHUHLVQR HQHUJ\ FKDQJH
LQYROYHGLQWKHLUIRUPDWLRQ7KLVLVQRWWUXHIRUYDOXHVVSHFLILHGDVVWDQGDUG*LEEVIUHH LQYROYHGLQWKHLUIRUPDWLRQ7KLVLVQRWWUXHIRUYDOXHVVSHFLILHGDVVWDQGDUG*LEEVIUHH
HQHUJ\RIIRUPDWLRQµ*I¶ZKLFKUHIHUVWRWKHVRFDOOHGDEVROXWHVFDOH>%DULQ@ HQHUJ\RIIRUPDWLRQµ*I¶ZKLFKUHIHUVWRWKHVRFDOOHGDEVROXWHVFDOH>%DULQ@
'XHWRWKLVGLYHUJHQFHZHSUHIHUWRXVHDQGUHIHUWRµ¨*I¶YDOXHV7KHPHDQLQJRI 'XHWRWKLVGLYHUJHQFHZHSUHIHUWRXVHDQGUHIHUWRµ¨*I¶YDOXHV7KHPHDQLQJRI
WKHGLIIHUHQWVFDOHVDQGWKHWUDQVIRUPDWLRQIURPRQHWRWKHRWKHUDUHEULHIO\GHDOWZLWK WKHGLIIHUHQWVFDOHVDQGWKHWUDQVIRUPDWLRQIURPRQHWRWKHRWKHUDUHEULHIO\GHDOWZLWK
LQ6HFWLRQ LQ6HFWLRQ
)RU DOPRVW DQ\ FRPSRXQG µ¨*I¶ RU µ*I¶  YDOXHV FDQ EH REWDLQHG IURP YDULRXV )RU DOPRVW DQ\ FRPSRXQG µ¨*I¶ RU µ*I¶  YDOXHV FDQ EH REWDLQHG IURP YDULRXV
VRXUFHVRUFDOFXODWHGEDVHGRQRWKHUWKHUPRG\QDPLFSDUDPHWHUVSURYLGHGLQWKHOLWHUD VRXUFHVRUFDOFXODWHGEDVHGRQRWKHUWKHUPRG\QDPLFSDUDPHWHUVSURYLGHGLQWKHOLWHUD
WXUH7KHVRXUFHVDQGRWKHUUHOHYDQWSDUDPHWHUVDUHGLVFXVVHGLQ6HFWLRQ:LWKLQ WXUH7KHVRXUFHVDQGRWKHUUHOHYDQWSDUDPHWHUVDUHGLVFXVVHGLQ6HFWLRQ:LWKLQ
RXUSURMHFWPRVWRIWKHDSSOLHGµ¨*I¶YDOXHVZHUHREWDLQHGIURPWKHWKHUPRG\QDPLF RXUSURMHFWPRVWRIWKHDSSOLHGµ¨*I¶YDOXHVZHUHREWDLQHGIURPWKHWKHUPRG\QDPLF
GDWDEDVH SURYLGHG LQ WKH VRIWZDUH 2XWRNXPSX µ+6&¶ &KHPLVWU\  ZKLFK ZDV DOVR GDWDEDVH SURYLGHG LQ WKH VRIWZDUH 2XWRNXPSX µ+6&¶ &KHPLVWU\  ZKLFK ZDV DOVR
XVHGIRUFDOFXODWLQJµ¨*¶RIUHDFWLRQV>2XNX2XNX@+RZHYHULQVRPH XVHGIRUFDOFXODWLQJµ¨*¶RIUHDFWLRQV>2XNX2XNX@+RZHYHULQVRPH
FDVHVHJZKHUHWKHWKHUPRG\QDPLFGDWDSURYLGHGLQµ+6&¶ZDVIRXQGWREHLQFRP FDVHVHJZKHUHWKHWKHUPRG\QDPLFGDWDSURYLGHGLQµ+6&¶ZDVIRXQGWREHLQFRP
SOHWHRUZHFDPHDFURVVGLVFUHSDQFLHVLQWKHVSHFLILHGYDOXHVDGGLWLRQDOVRXUFHVZHUH SOHWHRUZHFDPHDFURVVGLVFUHSDQFLHVLQWKHVSHFLILHGYDOXHVDGGLWLRQDOVRXUFHVZHUH
XVHG7KHVHDVSHFWVDUHIXUWKHUHODERUDWHGLQ6HFWLRQ XVHG7KHVHDVSHFWVDUHIXUWKHUHODERUDWHGLQ6HFWLRQ
7KHHVWDEOLVKPHQWRIµ¨*¶EDVHGRQµ¨*I¶DQGµ*I¶ YDOXHVLVEULHIO\H[HPSOLILHGLQ 7KHHVWDEOLVKPHQWRIµ¨*¶EDVHGRQµ¨*I¶DQGµ*I¶ YDOXHVLVEULHIO\H[HPSOLILHGLQ
WKHIROORZLQJE\PHDQVRIWKHDFLGEDVHUHDFWLRQGHVFULELQJWKHSUHFLSLWDWLRQRIIHUULF WKHIROORZLQJE\PHDQVRIWKHDFLGEDVHUHDFWLRQGHVFULELQJWKHSUHFLSLWDWLRQRIIHUULF
LRQDVKHPDWLWH FIUHDFWLRQPHFKDQLVPGHVFULEHGLQ6HFWLRQ  LRQDVKHPDWLWH FIUHDFWLRQPHFKDQLVPGHVFULEHGLQ6HFWLRQ 

)H+ + 2+ − → )H  2 + +  2 ( Δ* 
= −  N- )  >@ )H+ + 2+ − → )H  2 + +  2 ( Δ* 
= −  N- )  >@

7KHDVVRFLDWHGµ¨*I¶DQGµ*I¶YDOXHVDUHOLVWHGLQ7DEOH 7KHDVVRFLDWHGµ¨*I¶DQGµ*I¶YDOXHVDUHOLVWHGLQ7DEOH
 

%RWKPDMRUYHUVLRQVDQGRIµ+6&¶ZHUHXVHGWKURXJKRXWWKHSURMHFWSHULRG$SSDUHQWO\VRPH %RWKPDMRUYHUVLRQVDQGRIµ+6&¶ZHUHXVHGWKURXJKRXWWKHSURMHFWSHULRG$SSDUHQWO\VRPH
GDWDEDVHHQWULHVZHUHLQFRUUHFWLQYHUVLRQRUZURQJO\XSGDWHGLQYHUVLRQ7KXVGDWDIRUWKHUPR GDWDEDVHHQWULHVZHUHLQFRUUHFWLQYHUVLRQRUZURQJO\XSGDWHGLQYHUVLRQ7KXVGDWDIRUWKHUPR
G\QDPLFFDOFXODWLRQVZDVYHULILHGZLWKRWKHUSXEOLFDWLRQVDQGEHWZHHQWKHWZRµ+6&¶YHUVLRQV0RUH G\QDPLFFDOFXODWLRQVZDVYHULILHGZLWKRWKHUSXEOLFDWLRQVDQGEHWZHHQWKHWZRµ+6&¶YHUVLRQV0RUH
LQIRUPDWLRQLVJLYHQLQ6HFWLRQ LQIRUPDWLRQLVJLYHQLQ6HFWLRQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

7DEOH 6WDQGDUG *LEEV IUHH HQHUJ\ RI IRUPDWLRQ FKDQJH µ¨*I¶ DQG VWDQGDUG 7DEOH 6WDQGDUG *LEEV IUHH HQHUJ\ RI IRUPDWLRQ FKDQJH µ¨*I¶ DQG VWDQGDUG
*LEEVIUHHHQHUJ\RIIRUPDWLRQµ*I¶ YDOXHVIRUFRPSRXQGV LQYROYHG LQ *LEEVIUHHHQHUJ\RIIRUPDWLRQµ*I¶ YDOXHVIRUFRPSRXQGV LQYROYHG LQ
DFLGEDVHUHDFWLRQ>@ DFLGEDVHUHDFWLRQ>@

µ¨*I¶ µ*I¶ µ¨*I¶ µ*I¶


&RPSRXQG 5HIHUHQFH &RPSRXQG 5HIHUHQFH
N-PRO N-PRO N-PRO N-PRO
)H í  >6KRFN .RUH]N\@ )H í  >6KRFN .RUH]N\@
í í
2+  í í >6KRFN +HOJHVRQ@ 2+  í í >6KRFN +HOJHVRQ@

)H2 í í >%DULQ@ )H2 í í >%DULQ@

+2 í í >(6'8@ +2 í í >(6'8@


 
%DVHGRQWKHVHµ¨*I¶YDOXHVµ¨*¶RIWKHUHDFWLRQFDQEHFDOFXODWHGLQ DFFRUGDQFH %DVHGRQWKHVHµ¨*I¶YDOXHVµ¨*¶RIWKHUHDFWLRQFDQEHFDOFXODWHGLQ DFFRUGDQFH
ZLWKHTXDWLRQ>@WR ZLWKHTXDWLRQ>@WR

Δ*  ª¬ × ( − ) +  × ( −) º¼ − ª¬  × ( −) +  × ( − ) º¼ Δ*  ª¬ × ( − ) +  × ( −) º¼ − ª¬  × ( −) +  × ( − ) º¼
 >@  >@
 
Δ* −  N- Δ* −  N-

µ¨*¶ REWDLQHG LQ WKLV ZD\ LV LQ DJUHHPHQW ZLWK µ¨*¶ FDOFXODWHG E\ µ+6&¶ IRU WKH µ¨*¶ REWDLQHG LQ WKLV ZD\ LV LQ DJUHHPHQW ZLWK µ¨*¶ FDOFXODWHG E\ µ+6&¶ IRU WKH
DFLGEDVHUHDFWLRQ>@7KHHTXLYDOHQWFDOFXODWLRQEDVHGRQµ*I¶YDOXHVVKRZVWKDW DFLGEDVHUHDFWLRQ>@7KHHTXLYDOHQWFDOFXODWLRQEDVHGRQµ*I¶YDOXHVVKRZVWKDW
WKHVDPHµ¨*¶LVFDOFXODWHGEDVHGRQVWDQGDUG*LEEVIUHHHQHUJ\RIIRUPDWLRQLQWKH WKHVDPHµ¨*¶LVFDOFXODWHGEDVHGRQVWDQGDUG*LEEVIUHHHQHUJ\RIIRUPDWLRQLQWKH
DEVROXWHVFDOHDVWKHGLIIHUHQFHVFDQFHOHDFKRWKHURXWLQWKHFDOFXODWLRQ DEVROXWHVFDOHDVWKHGLIIHUHQFHVFDQFHOHDFKRWKHURXWLQWKHFDOFXODWLRQ

Δ*  ¬ª × ( − ) +  × ( − ) ¼º − ¬ª  ×  +  × ( − ) ¼º  >@


Δ*  ¬ª × ( − ) +  × ( − ) ¼º − ¬ª  ×  +  × ( − ) ¼º  >@
 
Δ* −  N- Δ* −  N-

7KHFRQFHSWRIFDOFXODWLQJµ¨*¶IRUDUHDFWLRQDWWKHVWDQGDUGVWDWHFDQEHH[WHQGHG 7KHFRQFHSWRIFDOFXODWLQJµ¨*¶IRUDUHDFWLRQDWWKHVWDQGDUGVWDWHFDQEHH[WHQGHG
WRDUELWUDU\FRQGLWLRQV QRQVWDQGDUGVWDWHV DFFRUGLQJWR WRDUELWUDU\FRQGLWLRQV QRQVWDQGDUGVWDWHV DFFRUGLQJWR

Δ* Δ*   5 × 7 × OQ ( . PD )  >@ Δ* Δ*   5 × 7 × OQ ( . PD )  >@

ZKHUHµ5¶ - .îPRO LVWKHJDVFRQVWDQWµ7¶LVWKHDEVROXWHWHPSHUDWXUHDQG ZKHUHµ5¶ - .îPRO LVWKHJDVFRQVWDQWµ7¶LVWKHDEVROXWHWHPSHUDWXUHDQG


µ.PD¶ LVWKHPDVVFRQVWDQW$GHULYDWLRQRIHTXDWLRQ>@JRHVEH\RQGWKHVFRSHRI µ.PD¶ LVWKHPDVVFRQVWDQW$GHULYDWLRQRIHTXDWLRQ>@JRHVEH\RQGWKHVFRSHRI
WKLV WKHVLV DQG UHIHUHQFH LV PDGH WR HJ >)UHLHVOHEHQ+DQVHQ  0¡OOHU D WKLV WKHVLV DQG UHIHUHQFH LV PDGH WR HJ >)UHLHVOHEHQ+DQVHQ  0¡OOHU D
%DUGDO@ %DUGDO@
$WWKHVWDQGDUGVWDWH µ.PD¶ LVHTXDOWRZKLFK LQDFFRUGDQFHZLWKHTXDWLRQ>@  $WWKHVWDQGDUGVWDWH µ.PD¶ LVHTXDOWRZKLFK LQDFFRUGDQFHZLWKHTXDWLRQ>@ 
PHDQVWKDWµ¨*¶LVHTXDOWRµ¨*¶,IWKHV\VWHPLVDWHTXLOLEULXP WKHUHDFWLRQLVUH PHDQVWKDWµ¨*¶LVHTXDOWRµ¨*¶,IWKHV\VWHPLVDWHTXLOLEULXP WKHUHDFWLRQLVUH
YHUVLEOH  µ¨*¶ LV HTXDO WR ]HUR DQG µ.PD¶  FRUUHVSRQGV WR WKH HTXLOLEULXP FRQVWDQW YHUVLEOH  µ¨*¶ LV HTXDO WR ]HUR DQG µ.PD¶  FRUUHVSRQGV WR WKH HTXLOLEULXP FRQVWDQW
µ.HT¶ +HQFHLQFRUUHVSRQGHQFHZLWK>@µ¨*¶FDQEHH[SUHVVHGDV µ.HT¶ +HQFHLQFRUUHVSRQGHQFHZLWK>@µ¨*¶FDQEHH[SUHVVHGDV

Δ*  − 5 × 7 × OQ ( . HT )  >@ Δ*  − 5 × 7 × OQ ( . HT )  >@

µ.PD¶ DQG µ.HT¶ FDQEHGHVFULEHGDV µ.PD¶ DQG µ.HT¶ FDQEHGHVFULEHGDV

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

] ]
. PD = . HT ∏D
L =
L
YL
 >@ . PD = . HT ∏D
L =
L
YL
 >@

ZKHUHµD¶LVWKHDFWLYLW\RIWKHLQYROYHGFRPSRXQGV7KXVIRUDUHDFWLRQRIWKHW\SH ZKHUHµD¶LVWKHDFWLYLW\RIWKHLQYROYHGFRPSRXQGV7KXVIRUDUHDFWLRQRIWKHW\SH
Y 5 5  +  + Y 5 ] 5 ] → Y 3 3 +  + Y 3] 3]  >@ Y 5 5  +  + Y 5 ] 5 ] → Y 3 3 +  + Y 3] 3]  >@

 µ.PD¶ DQG µ.HT¶ FDQEHZULWWHQDV  µ.PD¶ DQG µ.HT¶ FDQEHZULWWHQDV

(D ) ( ) (D ) ( )
Y 3 Y 3] Y 3 Y 3]
3 ×  × D 3] 3 ×  × D 3]
. PD = . HT  >@ . PD = . HT  >@
(D ) ×  × ( D ) (D ) ×  × ( D )
Y 5 Y5 ] Y 5 Y5 ]
5 5] 5 5]

7KHQDWXUDOORJDULWKPLQHTXDWLRQV>@DQG>@LVJHQHUDOO\WUDQVIHUUHGWRDEDVH 7KHQDWXUDOORJDULWKPLQHTXDWLRQV>@DQG>@LVJHQHUDOO\WUDQVIHUUHGWRDEDVH
ORJDULWKPWRH[SUHVVWKHTXDQWLWLHVDVIXQFWLRQRIWKHS+ ORJDULWKPWRH[SUHVVWKHTXDQWLWLHVDVIXQFWLRQRIWKHS+

S+ = − ORJ ( D ++ ) =  + ORJ D 2+ −  ( ) >@ S+ = − ORJ ( D ++ ) =  + ORJ D 2+ −  ( ) >@

7KXV ZLWK D FRQYHUVLRQ IDFWRU RI  OQ WR ORJ  DQG >@ LQVHUWHG HTXDWLRQV 7KXV ZLWK D FRQYHUVLRQ IDFWRU RI  OQ WR ORJ  DQG >@ LQVHUWHG HTXDWLRQV
>@DQG>@FDQEHUHZULWWHQDV >@DQG>@FDQEHUHZULWWHQDV

§ D ( ) ( ) · § D ( ) ( ) ·
Y 3 Y 3] Y 3 Y 3]
×  × D 3] ×  × D 3]
Δ* = Δ* +  × 5 × 7 × ORJ ¨ ¸ Δ* = Δ* +  × 5 × 7 × ORJ ¨ ¸
 3  3
>@ >@
¨ D ¸ ¨ D ¸
( ) ×  × ( D ) ( ) ×  × ( D )
Y 5 Y5 ] Y 5 Y5 ]

© 5 5] ¹ © 5 5] ¹
DQG DQG

§ D ( ) ( ) · § D ( ) ( ) ·
Y 3 Y 3] Y 3 Y 3]
×  × D 3] ×  × D 3]
Δ* = −  × 5 × 7 × ORJ ¨ ¸ Δ* = −  × 5 × 7 × ORJ ¨ ¸
 3  3
>@ >@
¨ D ¸ ¨ D ¸
( ) ×  × ( D ) ( ) ×  × ( D )
Y 5 Y5 ] Y 5 Y5 ]

© 5 5] ¹ © 5 5] ¹
)RUDVWDQGDUGVWDWHWHPSHUDWXUHµ7¶RIƒ& FI&KDSWHUµ7D'¶ HTXDWLRQV>@DQG )RUDVWDQGDUGVWDWHWHPSHUDWXUHµ7¶RIƒ& FI&KDSWHUµ7D'¶ HTXDWLRQV>@DQG
>@FRUUHVSRQGWR >@FRUUHVSRQGWR

§ D ( ) ( ) · § D ( ) ( ) ·
Y 3 Y 3] Y 3 Y 3]
×  × D 3] ×  × D 3]
Δ* = Δ* +  × ORJ ¨ ¸ Δ* = Δ* +  × ORJ ¨ ¸
 3  3
>@ >@
¨ D ¸ ¨ D ¸
( ) ×  × ( D ) ( ) ×  × ( D )
Y 5 Y5 ] Y 5 Y5 ]

© 5 5] ¹ © 5 5] ¹
DQG DQG

§ D ( ) ( ) · § D ( ) ( ) ·
Y 3 Y 3] Y 3 Y 3]
×  × D 3] ×  × D 3]
Δ* = −  × ORJ ¨ ¸ Δ* = −  × ORJ ¨ ¸
 3  3
>@ >@
¨ D ¸ ¨ D ¸
( ) ×  × ( D ) ( ) ×  × ( D )
Y 5 Y5 ] Y 5 Y5 ]

© 5 5] ¹ © 5 5] ¹
ZKHUHLVDIDFWRUFUHDWHGIURPµ5×7>.@¶WLPHVWKHFRQYHUVLRQIDFWRU OQWR ZKHUHLVDIDFWRUFUHDWHGIURPµ5×7>.@¶WLPHVWKHFRQYHUVLRQIDFWRU OQWR
ORJ  ORJ 
(TXDWLRQV >@ DQG >@ DUH RI FHQWUDO LPSRUWDQFH LQ WKH SUHVHQW WKHVLV $PRQJ (TXDWLRQV >@ DQG >@ DUH RI FHQWUDO LPSRUWDQFH LQ WKH SUHVHQW WKHVLV $PRQJ
RWKHUVHTXDWLRQ>@LVXVHGWKURXJKRXWWKLVWKHVLVWRWUDQVIHUµ¨*¶YDOXHV FDOFX RWKHUVHTXDWLRQ>@LVXVHGWKURXJKRXWWKLVWKHVLVWRWUDQVIHUµ¨*¶YDOXHV FDOFX

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

ODWHG E\ PHDQV RI µ+6&¶  WR WKH FRQGLWLRQV XQGHU FRQVLGHUDWLRQ  (TXDWLRQ >@ ODWHG E\ PHDQV RI µ+6&¶  WR WKH FRQGLWLRQV XQGHU FRQVLGHUDWLRQ  (TXDWLRQ >@
SOD\VDQLPSRUWDQWUROHLQFDOFXODWLQJDFLGEDVHHTXLOLEULDHJIRUWKHHVWDEOLVKPHQW SOD\VDQLPSRUWDQWUROHLQFDOFXODWLQJDFLGEDVHHTXLOLEULDHJIRUWKHHVWDEOLVKPHQW
RI3RXUEDL[GLDJUDPV FI6HFWLRQ  RI3RXUEDL[GLDJUDPV FI6HFWLRQ 
7KHILQDOLQSXWSDUDPHWHUIRUHTXDWLRQV>@DQG>@DUHWKHDFWLYLWLHVµD¶ZKLFK 7KHILQDOLQSXWSDUDPHWHUIRUHTXDWLRQV>@DQG>@DUHWKHDFWLYLWLHVµD¶ZKLFK
DSDUW IURP LRQ DFWLYLWLHV  FDQ EH WUHDWHG LQ D UDWKHU VLPSOH DSSURDFK ZKHQ GHDOLQJ DSDUW IURP LRQ DFWLYLWLHV  FDQ EH WUHDWHG LQ D UDWKHU VLPSOH DSSURDFK ZKHQ GHDOLQJ
ZLWKFXVWRPDU\DTXHRXVFRUURVLRQV\VWHPV LQFOXGLQJFRUURVLRQRIVWHHOLQFRQFUHWH  ZLWKFXVWRPDU\DTXHRXVFRUURVLRQV\VWHPV LQFOXGLQJFRUURVLRQRIVWHHOLQFRQFUHWH 
)RUVXFKHOHFWURFKHPLFDOV\VWHPVZHWKLQNWKDWLWLVVDWLVIDFWRU\WREDVHWKHFDOFXOD )RUVXFKHOHFWURFKHPLFDOV\VWHPVZHWKLQNWKDWLWLVVDWLVIDFWRU\WREDVHWKHFDOFXOD
WLRQVRQWKHIROORZLQJDVVXPSWLRQVFRQFHUQLQJWKHDFWLYLWLHVµD¶ FI&KDSWHUµ7D'¶  WLRQVRQWKHIROORZLQJDVVXPSWLRQVFRQFHUQLQJWKHDFWLYLWLHVµD¶ FI&KDSWHUµ7D'¶ 
‡ )RUJDVHVµD¶FRUUHVSRQGVWRWKHSDUWLDOSUHVVXUHµS¶LQ>EDU@ ‡ )RUJDVHVµD¶FRUUHVSRQGVWRWKHSDUWLDOSUHVVXUHµS¶LQ>EDU@
‡ )RUVROLGPDWWHUDQGVROYHQWVµD¶FRUUHVSRQGVWR ‡ )RUVROLGPDWWHUDQGVROYHQWVµD¶FRUUHVSRQGVWR
‡ )RU GLVVROYHG PDWWHU LRQLF VSHFLHV  µD¶ FRUUHVSRQGV WR WKH LRQ FRQFHQWUDWLRQ LQ ‡ )RU GLVVROYHG PDWWHU LRQLF VSHFLHV  µD¶ FRUUHVSRQGV WR WKH LRQ FRQFHQWUDWLRQ LQ
>PRO/@ >PRO/@
7KHFKRLFHRIUHSUHVHQWDWLYHLRQDFWLYLWLHVLVKHQFHDFULWLFDOSDUDPHWHUDQGDFHQWUDO 7KHFKRLFHRIUHSUHVHQWDWLYHLRQDFWLYLWLHVLVKHQFHDFULWLFDOSDUDPHWHUDQGDFHQWUDO
DVSHFWLQRXUSURMHFW7KLVDVSHFWLVGHDOWZLWKWKURXJKRXWWKLVWKHVLVDQGZLWKSDUWLFX DVSHFWLQRXUSURMHFW7KLVDVSHFWLVGHDOWZLWKWKURXJKRXWWKLVWKHVLVDQGZLWKSDUWLFX
ODU UHJDUG WR WKH HVWDEOLVKPHQW RI 3RXUEDL[ GLDJUDPV LQ 6HFWLRQ  ,I QRW VWDWHG ODU UHJDUG WR WKH HVWDEOLVKPHQW RI 3RXUEDL[ GLDJUDPV LQ 6HFWLRQ  ,I QRW VWDWHG
RWKHUZLVH WKH LRQ DFWLYLW\ IRU QXPHULFDO YDOXHV QRQVWDQGDUG VWDWHV  DQG IRU 3RXU RWKHUZLVH WKH LRQ DFWLYLW\ IRU QXPHULFDO YDOXHV QRQVWDQGDUG VWDWHV  DQG IRU 3RXU
EDL[GLDJUDPVFRUUHVSRQGVWRíPRO/ EDL[GLDJUDPVFRUUHVSRQGVWRíPRO/

 (TXLOLEULXP3RWHQWLDO'LIIHUHQFH  (TXLOLEULXP3RWHQWLDO'LIIHUHQFH


,QDJDOYDQLFFHOODWHTXLOLEULXPWKHHTXLOLEULXPSRWHQWLDOGLIIHUHQFHµ¨(¶ LQWKHOLW ,QDJDOYDQLFFHOODWHTXLOLEULXPWKHHTXLOLEULXPSRWHQWLDOGLIIHUHQFHµ¨(¶ LQWKHOLW
HUDWXUH DOVR UHIHUUHG WR DV HOHFWURPRWLYH IRUFH µ(0)¶ FI &KDSWHU µ7D'¶  FDQ EH HUDWXUH DOVR UHIHUUHG WR DV HOHFWURPRWLYH IRUFH µ(0)¶ FI &KDSWHU µ7D'¶  FDQ EH
PHDVXUHGDVWKHGLIIHUHQFHEHWZHHQWKHLQGLYLGXDOHTXLOLEULXPSRWHQWLDOVRIWZRHOHF PHDVXUHGDVWKHGLIIHUHQFHEHWZHHQWKHLQGLYLGXDOHTXLOLEULXPSRWHQWLDOVRIWZRHOHF
WURGHV8QGHUVWDQGDUGVWDWHFRQGLWLRQVWKHHTXLOLEULXPSRWHQWLDOGLIIHUHQFHLVUHIHUUHG WURGHV8QGHUVWDQGDUGVWDWHFRQGLWLRQVWKHHTXLOLEULXPSRWHQWLDOGLIIHUHQFHLVUHIHUUHG
WRDVµ¨(¶LQWKHSUHVHQWWKHVLV WRDVµ¨(¶LQWKHSUHVHQWWKHVLV
7KHGHWDLOHGWKHRU\RQKRZPHWDOVDWWDLQWKHLUHTXLOLEULXPSRWHQWLDODQGWKHUHDVRQIRU 7KHGHWDLOHGWKHRU\RQKRZPHWDOVDWWDLQWKHLUHTXLOLEULXPSRWHQWLDODQGWKHUHDVRQIRU
WKHGLIIHUHQFHLQHTXLOLEULXPSRWHQWLDOVLVFRPSOH[DQGEH\RQGWKHVFRSHRIWKLVWKH WKHGLIIHUHQFHLQHTXLOLEULXPSRWHQWLDOVLVFRPSOH[DQGEH\RQGWKHVFRSHRIWKLVWKH
VLV$EULHIDQGVLPSOLILHGQRWHRQWKLVWRSLFLVJLYHQLQ6HFWLRQ VLV$EULHIDQGVLPSOLILHGQRWHRQWKLVWRSLFLVJLYHQLQ6HFWLRQ
$FFRUGLQJWRWKHFRQYHQWLRQRI6WRFNKROPµ¨(¶RIDVSRQWDQHRXVV\VWHPLVGHILQHG $FFRUGLQJWRWKHFRQYHQWLRQRI6WRFNKROPµ¨(¶RIDVSRQWDQHRXVV\VWHPLVGHILQHG
WREHSRVLWLYH>,83$&@ WREHSRVLWLYH>,83$&@
Δ(  = (   − (  IRU (   < (    >@ Δ(  = (   − (  IRU (   < (    >@

µ¨(¶LVWKHIRUFHWKDWGULYHVHOHFWURQVLQDUHYHUVLEOHFHOODQGDFFRUGLQJO\DPHDVXUH µ¨(¶LVWKHIRUFHWKDWGULYHVHOHFWURQVLQDUHYHUVLEOHFHOODQGDFFRUGLQJO\DPHDVXUH
RIWKHFRUUHVSRQGLQJUHGR[UHDFWLRQLHWKHFRPELQDWLRQRIWKHDQRGLFDQGFDWKRGLF RIWKHFRUUHVSRQGLQJUHGR[UHDFWLRQLHWKHFRPELQDWLRQRIWKHDQRGLFDQGFDWKRGLF
UHDFWLRQV UHDFWLRQV

 

8QIRUWXQDWHO\µ+6&¶GRHVQRWSURYLGHIRUFDOFXODWLRQVRILQGLYLGXDOWKHUPRG\QDPLFSDUDPHWHUVIRU 8QIRUWXQDWHO\µ+6&¶GRHVQRWSURYLGHIRUFDOFXODWLRQVRILQGLYLGXDOWKHUPRG\QDPLFSDUDPHWHUVIRU
QRQVWDQGDUGVWDWHV+RZHYHUQRQVWDQGDUGVWDWHFRQGLWLRQVDUHUHSUHVHQWHGLQWKHHTXLOLEULDFDOFX QRQVWDQGDUGVWDWHV+RZHYHUQRQVWDQGDUGVWDWHFRQGLWLRQVDUHUHSUHVHQWHGLQWKHHTXLOLEULDFDOFX
ODWHGIRUHJWKHHVWDEOLVKPHQWRI3RXUEDL[GLDJUDPV 6HFWLRQ E\PHDQVRIµ+6&¶ ODWHGIRUHJWKHHVWDEOLVKPHQWRI3RXUEDL[GLDJUDPV 6HFWLRQ E\PHDQVRIµ+6&¶

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

+HQFHWKHWZRTXDQWLWLHVµ¨(¶DQGµ¨*¶DUHSURSRUWLRQDOWRHDFKRWKHUDQGWKHJHQ +HQFHWKHWZRTXDQWLWLHVµ¨(¶DQGµ¨*¶DUHSURSRUWLRQDOWRHDFKRWKHUDQGWKHJHQ
HUDOGHILQLWLRQVIRUµ¨*¶JLYHQLQ6HFWLRQFDQEHWUDQVIHUUHG7KHPD[LPXPXVH HUDOGHILQLWLRQVIRUµ¨*¶JLYHQLQ6HFWLRQFDQEHWUDQVIHUUHG7KHPD[LPXPXVH
IXOZRUNLVHTXLYDOHQWWRWKHPD[LPXPHOHFWULFDOHQHUJ\WKDWFDQEHDFKLHYHGIURPD IXOZRUNLVHTXLYDOHQWWRWKHPD[LPXPHOHFWULFDOHQHUJ\WKDWFDQEHDFKLHYHGIURPD
UHYHUVLEOHFHOO7KHPD[LPXPDFKLHYDEOHHOHFWULFDOHQHUJ\FRUUHVSRQGVWRµ¨(¶WLPHV UHYHUVLEOHFHOO7KHPD[LPXPDFKLHYDEOHHOHFWULFDOHQHUJ\FRUUHVSRQGVWRµ¨(¶WLPHV
WKHFKDUJH µ4¶ $FFRUGLQJWR)DUDGD\¶VODZ DFKDUJHHTXDOWRµQ¶WLPHVWKH)DUDGD\ WKHFKDUJH µ4¶ $FFRUGLQJWR)DUDGD\¶VODZ DFKDUJHHTXDOWRµQ¶WLPHVWKH)DUDGD\
FRQVWDQW µ)¶ î &PRO LV SDVVHG SHU PROH RI D VSHFLHV LQ WKH R[LGDWLRQ FRQVWDQW µ)¶ î &PRO LV SDVVHG SHU PROH RI D VSHFLHV LQ WKH R[LGDWLRQ
VWDWHµQ¶ 7KDWOHDGVWR VWDWHµQ¶ 7KDWOHDGVWR
4 Q × ) >@ 4 Q × ) >@

$FFRUGLQJO\ WKH WKHUPRG\QDPLF UHODWLRQ EHWZHHQ µ¨(¶ DQG µ¨*¶ FDQ EH H[SUHVVHG $FFRUGLQJO\ WKH WKHUPRG\QDPLF UHODWLRQ EHWZHHQ µ¨(¶ DQG µ¨*¶ FDQ EH H[SUHVVHG
DV DV
Δ* = − Q × ) × Δ(   >@ Δ * = − Q × ) × Δ(   >@

7KHQHJDWLYHVLJQLQHTXDWLRQ>@FRQILUPVWKHGHILQLWLRQWKDWSRVLWLYHZRUNLHD 7KHQHJDWLYHVLJQLQHTXDWLRQ>@FRQILUPVWKHGHILQLWLRQWKDWSRVLWLYHZRUNLHD
SRVLWLYHµ¨(¶UHVXOWVLQDQHJDWLYHµ¨*¶7KHUHIRUHLQDFFRUGDQFHZLWKWKHFODVVLILFD SRVLWLYHµ¨(¶UHVXOWVLQDQHJDWLYHµ¨*¶7KHUHIRUHLQDFFRUGDQFHZLWKWKHFODVVLILFD
WLRQVIRUµ¨*¶LQ6HFWLRQWKHIROORZLQJKROGVIRUµ¨(¶ WLRQVIRUµ¨*¶LQ6HFWLRQWKHIROORZLQJKROGVIRUµ¨(¶
‡ µ¨(¶ !  PHDQV WKDW WKH UHYHUVLEOH FHOO SURGXFHV HQHUJ\ +HQFH WKH DVVRFLDWHG ‡ µ¨(¶ !  PHDQV WKDW WKH UHYHUVLEOH FHOO SURGXFHV HQHUJ\ +HQFH WKH DVVRFLDWHG
UHGR[UHDFWLRQLVVSRQWDQHRXV UHGR[UHDFWLRQLVVSRQWDQHRXV
‡ µ¨(¶PHDQVWKDWHQHUJ\PXVWEHVXSSOLHGWRWKHV\VWHP+HQFHWKHDVVRFLDWHG ‡ µ¨(¶PHDQVWKDWHQHUJ\PXVWEHVXSSOLHGWRWKHV\VWHP+HQFHWKHDVVRFLDWHG
UHGR[UHDFWLRQLVQRQVSRQWDQHRXV UHGR[UHDFWLRQLVQRQVSRQWDQHRXV

 5HIHUHQFH5HGXFWLRQ(TXLOLEULXPDQG6WDQGDUG3RWHQWLDO  5HIHUHQFH5HGXFWLRQ(TXLOLEULXPDQG6WDQGDUG3RWHQWLDO


$VPHQWLRQHGLQ6HFWLRQµ¨(¶FDQEHPHDVXUHGLQDV\VWHPDWHTXLOLEULXPDV $VPHQWLRQHGLQ6HFWLRQµ¨(¶FDQEHPHDVXUHGLQDV\VWHPDWHTXLOLEULXPDV
WKHGLIIHUHQFHEHWZHHQWKHLQGLYLGXDOHTXLOLEULXPSRWHQWLDOV+RZHYHULWLVLPSRVVL WKHGLIIHUHQFHEHWZHHQWKHLQGLYLGXDOHTXLOLEULXPSRWHQWLDOV+RZHYHULWLVLPSRVVL
EOHWRPHDVXUHWKHDEVROXWHYDOXHRIDQ\HTXLOLEULXPSRWHQWLDO WKHHOHFWURGHSRWHQWLDO EOHWRPHDVXUHWKHDEVROXWHYDOXHRIDQ\HTXLOLEULXPSRWHQWLDO WKHHOHFWURGHSRWHQWLDO
DVVRFLDWHG ZLWK D VLQJOH KDOIFHOO UHDFWLRQ  EHFDXVH WKH WZR KDOIFHOO UHDFWLRQV LQ D DVVRFLDWHG ZLWK D VLQJOH KDOIFHOO UHDFWLRQ  EHFDXVH WKH WZR KDOIFHOO UHDFWLRQV LQ D
JDOYDQLFFHOODUHQRWLQGHSHQGHQWRIHDFKRWKHU2QO\WKHµ¨(¶EHWZHHQWZRKDOIFHOO JDOYDQLFFHOODUHQRWLQGHSHQGHQWRIHDFKRWKHU2QO\WKHµ¨(¶EHWZHHQWZRKDOIFHOO
UHDFWLRQV LHDUHGR[FRXSOH LVPHDVXUDEOHDQGDFHUWDLQHOHFWURGHSRWHQWLDOPXVWEH UHDFWLRQV LHDUHGR[FRXSOH LVPHDVXUDEOHDQGDFHUWDLQHOHFWURGHSRWHQWLDOPXVWEH
VHOHFWHGDVWKHUHIHUHQFH,QDFFRUGDQFHZLWKWKH]HURRUUHIHUHQFHSRLQWRIWKHVWDQ VHOHFWHGDVWKHUHIHUHQFH,QDFFRUGDQFHZLWKWKH]HURRUUHIHUHQFHSRLQWRIWKHVWDQ
GDUGHOHFWURPRWLYHIRUFHVHULHVDQGRWKHUWKHUPRG\QDPLFWRROV LQSDUWLFXODUWKH3RXU GDUGHOHFWURPRWLYHIRUFHVHULHVDQGRWKHUWKHUPRG\QDPLFWRROV LQSDUWLFXODUWKH3RXU
EDL[ GLDJUDP FI 6HFWLRQ   WKH UHIHUHQFH SRLQW IRU HOHFWURGH SRWHQWLDOV LQ WKLV EDL[ GLDJUDP FI 6HFWLRQ   WKH UHIHUHQFH SRLQW IRU HOHFWURGH SRWHQWLDOV LQ WKLV
WKHVLV LV FKRVHQ DV WKH HOHFWURGH SRWHQWLDO RI WKH K\GURJHQ KDOIFHOO UHDFWLRQ DW VWDQ WKHVLV LV FKRVHQ DV WKH HOHFWURGH SRWHQWLDO RI WKH K\GURJHQ KDOIFHOO UHDFWLRQ DW VWDQ
GDUGVWDWH GDUGVWDWH

+ + + H− → +  (( 
 ≡  P96+( )  >@ + + + H− → +  (( 
 ≡  P96+( )  >@

7KLVUHIHUHQFHSRLQWLVDOVRNQRZQDVWKHHOHFWURGHSRWHQWLDORIWKHVWDQGDUGK\GURJHQ 7KLVUHIHUHQFHSRLQWLVDOVRNQRZQDVWKHHOHFWURGHSRWHQWLDORIWKHVWDQGDUGK\GURJHQ
HOHFWURGH µ6+(¶ LQ WKH OLWHUDWXUH DOVR UHIHUUHG WR DV QRUPDO K\GURJHQ HOHFWURGH HOHFWURGH µ6+(¶ LQ WKH OLWHUDWXUH DOVR UHIHUUHG WR DV QRUPDO K\GURJHQ HOHFWURGH
µ1+(¶  7KLV LV D FRPPRQ FKRLFH LQ WKH OLWHUDWXUH RQ FRUURVLRQ VFLHQFH ZKHUHDV µ1+(¶  7KLV LV D FRPPRQ FKRLFH LQ WKH OLWHUDWXUH RQ FRUURVLRQ VFLHQFH ZKHUHDV
PRVWRIWKHOLWHUDWXUHGHDOLQJH[FOXVLYHO\ZLWKUHLQIRUFHPHQWFRUURVLRQUHIHUVWRRWKHU PRVWRIWKHOLWHUDWXUHGHDOLQJH[FOXVLYHO\ZLWKUHLQIRUFHPHQWFRUURVLRQUHIHUVWRRWKHU
 

1DPHGDIWHU0LFKDHO)DUDGD\8.>5REHUJH@ 1DPHGDIWHU0LFKDHO)DUDGD\8.>5REHUJH@

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

UHIHUHQFHSRWHQWLDOVRIWHQWRWKHRQHRIWKHVDWXUDWHGFDORPHOHOHFWURGHµ6&(¶+DOI UHIHUHQFHSRWHQWLDOVRIWHQWRWKHRQHRIWKHVDWXUDWHGFDORPHOHOHFWURGHµ6&(¶+DOI
FHOOUHDFWLRQVDQGWKHFRUUHVSRQGLQJHOHFWURGHSRWHQWLDOVRIWKHPRVWLPSRUWDQWRWKHU FHOOUHDFWLRQVDQGWKHFRUUHVSRQGLQJHOHFWURGHSRWHQWLDOVRIWKHPRVWLPSRUWDQWRWKHU
UHIHUHQFH HOHFWURGHV XVHG LQ FRUURVLRQ DQG UHLQIRUFHPHQW FRUURVLRQ VFLHQFH DUH GLV UHIHUHQFH HOHFWURGHV XVHG LQ FRUURVLRQ DQG UHLQIRUFHPHQW FRUURVLRQ VFLHQFH DUH GLV
FXVVHGLQ6HFWLRQ FXVVHGLQ6HFWLRQ
%\GHILQLQJDUHIHUHQFHSRLQWWKHHOHFWURGHSRWHQWLDOFDQEHXVHGHTXLYDOHQWO\WRWKH %\GHILQLQJDUHIHUHQFHSRLQWWKHHOHFWURGHSRWHQWLDOFDQEHXVHGHTXLYDOHQWO\WRWKH
µ¨(¶LQHTXDWLRQ>@WRH[SUHVVWKHWKHUPRG\QDPLFUHODWLRQEHWZHHQµ¨*¶DQGWKH µ¨(¶LQHTXDWLRQ>@WRH[SUHVVWKHWKHUPRG\QDPLFUHODWLRQEHWZHHQµ¨*¶DQGWKH
HTXLOLEULXPSRWHQWLDOµ(¶ HTXLOLEULXPSRWHQWLDOµ(¶
Δ* = − ] × ) × (   >@ Δ* = − ] × ) × (   >@

)RUDKDOIFHOOUHDFWLRQDWLWVHTXLOLEULXPSRWHQWLDOµ(¶UHGXFWLRQDQGR[LGDWLRQUHDF )RUDKDOIFHOOUHDFWLRQDWLWVHTXLOLEULXPSRWHQWLDOµ(¶UHGXFWLRQDQGR[LGDWLRQUHDF
WLRQV RFFXU DW WKH VDPH UDWH LH WKH KDOIFHOO UHDFWLRQ LV UHYHUVLEOH )RU H[DPSOH DW WLRQV RFFXU DW WKH VDPH UDWH LH WKH KDOIFHOO UHDFWLRQ LV UHYHUVLEOH )RU H[DPSOH DW
µ(¶DQLURQHOHFWURGHUHOHDVHVLRQVIURPWKHVXUIDFHDQGGLVFKDUJHVWKHPRQWKHVXU µ(¶DQLURQHOHFWURGHUHOHDVHVLRQVIURPWKHVXUIDFHDQGGLVFKDUJHVWKHPRQWKHVXU
IDFHDWWKHVDPHUDWH7KLVLVRIWHQLQGLFDWHGE\DGRXEOHDUURZLQWKHOLWHUDWXUH IDFHDWWKHVDPHUDWH7KLVLVRIWHQLQGLFDWHGE\DGRXEOHDUURZLQWKHOLWHUDWXUH

)H R )H  + + H − (( 
 =  {} P96+( )  >@ )H R )H  + + H − (( 
 =  {} P96+( )  >@

7KLVQRWDWLRQLVRPLWWHGLQWKHSUHVHQWWKHVLV&RQVLGHULQJWKHUHYHUVLELOLW\RIKDOIFHOO 7KLVQRWDWLRQLVRPLWWHGLQWKHSUHVHQWWKHVLV&RQVLGHULQJWKHUHYHUVLELOLW\RIKDOIFHOO
UHDFWLRQV WKHUH DOVR LV D VLJQ SUREOHP IRU WKH HOHFWURGH SRWHQWLDO )RU WKH UHGXFWLRQ UHDFWLRQV WKHUH DOVR LV D VLJQ SUREOHP IRU WKH HOHFWURGH SRWHQWLDO )RU WKH UHGXFWLRQ
SRWHQWLDOµ(UHG¶DQGWKHR[LGDWLRQSRWHQWLDOµ(R[L¶WKHQXPHULFYDOXHLVLGHQWLFDOEXW SRWHQWLDOµ(UHG¶DQGWKHR[LGDWLRQSRWHQWLDOµ(R[L¶WKHQXPHULFYDOXHLVLGHQWLFDOEXW
WKHVLJQLVRSSRVHGDVLOOXVWUDWHGE\WKHKDOIFHOOUHDFWLRQV>@DQG>@ WKHVLJQLVRSSRVHGDVLOOXVWUDWHGE\WKHKDOIFHOOUHDFWLRQV>@DQG>@
5HGXFWLRQUHDFWLRQ 5HGXFWLRQUHDFWLRQ

)H + + H − → )H (( 
 UHG = −  {−} P96+( )  >@ )H + + H − → )H (( 
 UHG = −  {−} P96+( )  >@

2[LGDWLRQUHDFWLRQ 2[LGDWLRQUHDFWLRQ

)H → )H + + H− (( 
 R[L =  {} P96+( )  >@ )H → )H + + H− (( 
 R[L =  {} P96+( )  >@

,QWKLVWKHVLVDOOKDOIFHOOUHDFWLRQVDQGVSHFLILHGHTXLOLEULXPSRWHQWLDOVDUHJLYHQLQ ,QWKLVWKHVLVDOOKDOIFHOOUHDFWLRQVDQGVSHFLILHGHTXLOLEULXPSRWHQWLDOVDUHJLYHQLQ
WKHQRWDWLRQDFFRUGLQJWRWKHFRQYHQWLRQRI6WRFNKROP>,83$&@7KHHTXLOLE WKHQRWDWLRQDFFRUGLQJWRWKHFRQYHQWLRQRI6WRFNKROP>,83$&@7KHHTXLOLE
ULXPSRWHQWLDO³«LVGHILQHGDVWKHUHGXFWLRQSRWHQWLDODQGDOOKDOIUHDFWLRQVDUHUHDG ULXPSRWHQWLDO³«LVGHILQHGDVWKHUHGXFWLRQSRWHQWLDODQGDOOKDOIUHDFWLRQVDUHUHDG
LQWKHVHQVHRIWKHUHGXFWLRQ´ LQWKHVHQVHRIWKHUHGXFWLRQ´
7KDWPHDQVWKDWWKHVLJQRIWKHHTXLOLEULXPSRWHQWLDOµ(¶LVGHILQHGDVWKHVLJQRIWKH 7KDWPHDQVWKDWWKHVLJQRIWKHHTXLOLEULXPSRWHQWLDOµ(¶LVGHILQHGDVWKHVLJQRIWKH
UHGXFWLRQSRWHQWLDOµ(UHG¶ UHGXFWLRQSRWHQWLDOµ(UHG¶
( (  UHG  >@ ( (  UHG  >@

7KLVGHILQLWLRQLQFOXGHVWKDWLIQRWVWDWHGRWKHUZLVHLQWKHSUHVHQWWKHVLVµ(¶IRUDQ 7KLVGHILQLWLRQLQFOXGHVWKDWLIQRWVWDWHGRWKHUZLVHLQWKHSUHVHQWWKHVLVµ(¶IRUDQ
R[LGDWLRQUHDFWLRQ DOZD\VUHIHUVWRWKHUHGXFWLRQSRWHQWLDO$FFRUGLQJO\>@FRUUH R[LGDWLRQUHDFWLRQ DOZD\VUHIHUVWRWKHUHGXFWLRQSRWHQWLDO$FFRUGLQJO\>@FRUUH
VSRQGVWR VSRQGVWR

)H → )H + + H − (( 
 = −  {−} P96+( )  >@ )H → )H + + H − (( 
 = −  {−} P96+( )  >@

,WVKRXOGEHQRWHGWKDWWKHH[HPSOLILFDWLRQJLYHQLQ6HFWLRQFRUUHVSRQGVWRWKLV ,WVKRXOGEHQRWHGWKDWWKHH[HPSOLILFDWLRQJLYHQLQ6HFWLRQFRUUHVSRQGVWRWKLV
GHILQLWLRQ GHILQLWLRQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

$PRQJWKHEHQHILWVRIFRQVLVWHQF\ ZLWKHJ3RXUEDL[GLDJUDPV FI 6HFWLRQ   $PRQJWKHEHQHILWVRIFRQVLVWHQF\ ZLWKHJ3RXUEDL[GLDJUDPV FI 6HFWLRQ  
WKHVSHFLILFDWLRQRIWKHHTXLOLEULXPSRWHQWLDODVWKHUHGXFWLRQSRWHQWLDO UHJDUGOHVVRI WKHVSHFLILFDWLRQRIWKHHTXLOLEULXPSRWHQWLDODVWKHUHGXFWLRQSRWHQWLDO UHJDUGOHVVRI
WKHGLUHFWLRQRIWKHKDOIFHOOUHDFWLRQ SURYLGHVWKHPDMRUDGYDQWDJHWKDWWKHQXPHULFDO WKHGLUHFWLRQRIWKHKDOIFHOOUHDFWLRQ SURYLGHVWKHPDMRUDGYDQWDJHWKDWWKHQXPHULFDO
YDOXHVPDWFKWKHSRODULW\RIH[SHULPHQWDOO\PHDVXUHGSRWHQWLDOV FI&KDSWHU  YDOXHVPDWFKWKHSRODULW\RIH[SHULPHQWDOO\PHDVXUHGSRWHQWLDOV FI&KDSWHU 
$VLQPRVWRWKHUOLWHUDWXUHWKHVLJQRIWKHHOHFWURGHSRWHQWLDORIDQ\VSHFLHVFRPSDUHG $VLQPRVWRWKHUOLWHUDWXUHWKHVLJQRIWKHHOHFWURGHSRWHQWLDORIDQ\VSHFLHVFRPSDUHG
WRWKHµ6+(¶LVGHILQHGDVIROORZVLQWKHSUHVHQWWKHVLV>%DUGDO@ WRWKHµ6+(¶LVGHILQHGDVIROORZVLQWKHSUHVHQWWKHVLV>%DUGDO@
³7KHKDOIFHOOSRWHQWLDORIDUHDFWLRQ;UHIHUUHGWRWKHµ6+(¶FRUUHVSRQGVWRWKHYROW ³7KHKDOIFHOOSRWHQWLDORIDUHDFWLRQ;UHIHUUHGWRWKHµ6+(¶FRUUHVSRQGVWRWKHYROW
DJHRIWKHFHOOLQZKLFKWKHK\GURJHQUHDFWLRQSURFHHGVDVR[LGDWLRQDQG;DVUHGXF DJHRIWKHFHOOLQZKLFKWKHK\GURJHQUHDFWLRQSURFHHGVDVR[LGDWLRQDQG;DVUHGXF
WLRQ´ WLRQ´
7KLVPHDQVWKDWDQ\HOHFWURGHRUHQYLURQPHQWDFFHSWLQJHOHFWURQVIURPWKHµ6+(¶LV 7KLVPHDQVWKDWDQ\HOHFWURGHRUHQYLURQPHQWDFFHSWLQJHOHFWURQVIURPWKHµ6+(¶LV
GHILQHGWREHDWDSRVLWLYHHOHFWURGHSRWHQWLDOZKHUHDVDQ\HOHFWURGHRUHQYLURQPHQW GHILQHGWREHDWDSRVLWLYHHOHFWURGHSRWHQWLDOZKHUHDVDQ\HOHFWURGHRUHQYLURQPHQW
GRQDWLQJHOHFWURQVWRWKHµ6+(¶LVGHILQHGWREHDWDQHJDWLYHHOHFWURGHSRWHQWLDO GRQDWLQJHOHFWURQVWRWKHµ6+(¶LVGHILQHGWREHDWDQHJDWLYHHOHFWURGHSRWHQWLDO
$QH[HPSOLILFDWLRQIRUWKHUHODWLRQEHWZHHQµ¨(¶µ¨*¶DQGµ(¶ EDVHGRQR[LGDWLRQ $QH[HPSOLILFDWLRQIRUWKHUHODWLRQEHWZHHQµ¨(¶µ¨*¶DQGµ(¶ EDVHGRQR[LGDWLRQ
RIIHUURXVLRQDVDQRGLFUHDFWLRQDQGK\GURJHQLRQUHGXFWLRQDVFDWKRGLFUHDFWLRQ LV RIIHUURXVLRQDVDQRGLFUHDFWLRQDQGK\GURJHQLRQUHGXFWLRQDVFDWKRGLFUHDFWLRQ LV
JLYHQLQWKHIROORZLQJ,QWKLVFDVHLWLVDVVXPHGWKDWWKHKDOIFHOOUHDFWLRQVWDNHSODFH JLYHQLQWKHIROORZLQJ,QWKLVFDVHLWLVDVVXPHGWKDWWKHKDOIFHOOUHDFWLRQVWDNHSODFH
DWWKHVDPHUDWH7KLVLVDWKHRUHWLFDODVVXPSWLRQDQGQRWWUXHLQSUDFWLFH FI6HFWLRQ DWWKHVDPHUDWH7KLVLVDWKHRUHWLFDODVVXPSWLRQDQGQRWWUXHLQSUDFWLFH FI6HFWLRQ
   
$QRGLFUHDFWLRQ $QRGLFUHDFWLRQ

)H → )H+ + H− (( 
 = −  {} P96+( )  >@ )H → )H+ + H− (( 
 = −  {} P96+( )  >@

&DWKRGLFUHDFWLRQ &DWKRGLFUHDFWLRQ

+ + + H− → +  (( 
 =  P96+( )  >@ + + + H− → +  (( 
 =  P96+( )  >@

$FFRUGLQJWR>@µ¨(¶RIWKLVV\VWHPLVREWDLQHGWR $FFRUGLQJWR>@µ¨(¶RIWKLVV\VWHPLVREWDLQHGWR

Δ(  = (  F − (  D =  − − =  9  >@ Δ(  = (  F − (  D =  − − =  9  >@

7KHVXPRI>@DQG>@OHDGVWRWKHFRUUHVSRQGLQJUHGR[UHDFWLRQ 7KHVXPRI>@DQG>@OHDGVWRWKHFRUUHVSRQGLQJUHGR[UHDFWLRQ

)H  +  → )H  +  ( Δ* 
= −  N- )  >@ )H  +  → )H  +  ( Δ* 
= −  N- )  >@

:LWK>@UHZULWWHQDV :LWK>@UHZULWWHQDV
Δ* Δ*
Δ(  = −  >@ Δ(  = −  >@
Q×) Q×)

DQGµ¨*¶µQ¶DQGµ)¶LQVHUWHGµ¨(¶RIWKHUHYHUVLEOHFHOOLVREWDLQHGWR DQGµ¨*¶µQ¶DQGµ)¶LQVHUWHGµ¨(¶RIWKHUHYHUVLEOHFHOOLVREWDLQHGWR
−  − 
Δ(  = − =  9  >@ Δ(  = − =  9  >@
 ×    ×  

7KXVµ¨(¶REWDLQHGIURP>@FRUUHVSRQGVWRµ¨(¶REWDLQHGIURP>@ZKLFK 7KXVµ¨(¶REWDLQHGIURP>@FRUUHVSRQGVWRµ¨(¶REWDLQHGIURP>@ZKLFK
H[HPSOLILHVWKHWKHUPRG\QDPLFUHODWLRQEHWZHHQµ¨(¶DQGµ¨*¶0RUHRYHULWFDQEH H[HPSOLILHVWKHWKHUPRG\QDPLFUHODWLRQEHWZHHQµ¨(¶DQGµ¨*¶0RUHRYHULWFDQEH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

REVHUYHGWKDWµ(¶VSHFLILHGLQWKHKDOIFHOOUHDFWLRQ>@FRUUHVSRQGVWRµ¨(¶FDO REVHUYHGWKDWµ(¶VSHFLILHGLQWKHKDOIFHOOUHDFWLRQ>@FRUUHVSRQGVWRµ¨(¶FDO
FXODWHG LQ >@ DQG >@ DV UHGXFWLRQ RI K\GURJHQ ZDV FKRVHQ DV FDWKRGLF UHDF FXODWHG LQ >@ DQG >@ DV UHGXFWLRQ RI K\GURJHQ ZDV FKRVHQ DV FDWKRGLF UHDF
WLRQ WLRQ
7KHGHILQLWLRQRIDUHIHUHQFHSRLQWDOORZVFRPSDULVRQRIVWDQGDUGSRWHQWLDOVRIGLIIHU 7KHGHILQLWLRQRIDUHIHUHQFHSRLQWDOORZVFRPSDULVRQRIVWDQGDUGSRWHQWLDOVRIGLIIHU
HQW KDOIFHOO UHDFWLRQV FI 6HFWLRQ   DQG HQDEOHV HJ EDVHG RQ PHDVXUHG HOHF HQW KDOIFHOO UHDFWLRQV FI 6HFWLRQ   DQG HQDEOHV HJ EDVHG RQ PHDVXUHG HOHF
WURGHSRWHQWLDOV FRQFOXVLRQVRQWKHGLUHFWLRQRIWKHHYDOXDWHGKDOIFHOOUHDFWLRQV WURGHSRWHQWLDOV FRQFOXVLRQVRQWKHGLUHFWLRQRIWKHHYDOXDWHGKDOIFHOOUHDFWLRQV
,IWKHHOHFWURGHSRWHQWLDOLVORZHUWKDQWKHHTXLOLEULXPSRWHQWLDORIWKHDVVRFLDWHGKDOI ,IWKHHOHFWURGHSRWHQWLDOLVORZHUWKDQWKHHTXLOLEULXPSRWHQWLDORIWKHDVVRFLDWHGKDOI
FHOOUHDFWLRQWKHKDOIFHOOUHDFWLRQJRHVLQWRWKHUHGXFWLRQGLUHFWLRQ,IWKHHOHFWURGH FHOOUHDFWLRQWKHKDOIFHOOUHDFWLRQJRHVLQWRWKHUHGXFWLRQGLUHFWLRQ,IWKHHOHFWURGH
SRWHQWLDOLVKLJKHUWKHDVVRFLDWHGKDOIFHOOUHDFWLRQJRHVLQWRWKHR[LGDWLRQGLUHFWLRQ SRWHQWLDOLVKLJKHUWKHDVVRFLDWHGKDOIFHOOUHDFWLRQJRHVLQWRWKHR[LGDWLRQGLUHFWLRQ
,Q FRUUHVSRQGHQFH ZLWK WKH FDOFXODWLRQ RI µ¨*¶ YDOXHV FI 6HFWLRQ   DOO µ(¶ ,Q FRUUHVSRQGHQFH ZLWK WKH FDOFXODWLRQ RI µ¨*¶ YDOXHV FI 6HFWLRQ   DOO µ(¶
VWDWHGLQWKHSUHVHQWWKHVLVKDYHEHHQFDOFXODWHGXVLQJµ+6&¶DQGPRVWDUHEDVHGRQ VWDWHGLQWKHSUHVHQWWKHVLVKDYHEHHQFDOFXODWHGXVLQJµ+6&¶DQGPRVWDUHEDVHGRQ
WKHLQFOXGHGWKHUPRG\QDPLFGDWDEDVH>2XNX2XNX@,IDQXPHULFDOYDOXH WKHLQFOXGHGWKHUPRG\QDPLFGDWDEDVH>2XNX2XNX@,IDQXPHULFDOYDOXH
IRU µ(¶ ZDV IRXQG DYDLODEOH LQ WKH OLWHUDWXUH LW LV OLVWHG DV WKH VHFRQG YDOXH LQ WKH IRU µ(¶ ZDV IRXQG DYDLODEOH LQ WKH OLWHUDWXUH LW LV OLVWHG DV WKH VHFRQG YDOXH LQ WKH
FXUO\EUDFNHWV ^` ,IQRWVWDWHGRWKHUZLVHWKLVYDOXHZDVWDNHQIURP>-RQHV@ FXUO\EUDFNHWV ^` ,IQRWVWDWHGRWKHUZLVHWKLVYDOXHZDVWDNHQIURP>-RQHV@
FI&KDSWHUµ7D'¶  FI&KDSWHUµ7D'¶ 
,QFDVHRILQFRPSOHWHRULGHQWLILHGHUURQHRXVHQWULHVDGGLWLRQDOVRXUFHVZHUHXVHGDQG ,QFDVHRILQFRPSOHWHRULGHQWLILHGHUURQHRXVHQWULHVDGGLWLRQDOVRXUFHVZHUHXVHGDQG
YHULILFDWLRQVZHUHSHUIRUPHG,Q6HFWLRQVXFKDYHULILFDWLRQLVH[HPSOLILHGIRUWKH YHULILFDWLRQVZHUHSHUIRUPHG,Q6HFWLRQVXFKDYHULILFDWLRQLVH[HPSOLILHGIRUWKH
µ(¶RIWKHUHGXFWLRQRIIHUURXVLRQZKLFKVKRZVDFRQVLGHUDEOHGHYLDWLRQEHWZHHQ µ(¶RIWKHUHGXFWLRQRIIHUURXVLRQZKLFKVKRZVDFRQVLGHUDEOHGHYLDWLRQEHWZHHQ
WKH FDOFXODWHG YDOXH µ+6&¶ µ(¶  íP96+(  DQG WKH OLWHUDWXUH YDOXH >-RQHV WKH FDOFXODWHG YDOXH µ+6&¶ µ(¶  íP96+(  DQG WKH OLWHUDWXUH YDOXH >-RQHV
@DQGPRVWRWKHUOLWHUDWXUHµ(¶ íP96+(  @DQGPRVWRWKHUOLWHUDWXUHµ(¶ íP96+( 

 5HOHYDQW+DOI&HOO5HDFWLRQVDQG6WDQGDUG3RWHQWLDOV  5HOHYDQW+DOI&HOO5HDFWLRQVDQG6WDQGDUG3RWHQWLDOV


$OLVWRIKDOIFHOOUHDFWLRQVVRUWHGDFFRUGLQJWRWKHLUDVVRFLDWHGVWDQGDUGSRWHQWLDOVLV $OLVWRIKDOIFHOOUHDFWLRQVVRUWHGDFFRUGLQJWRWKHLUDVVRFLDWHGVWDQGDUGSRWHQWLDOVLV
RIWHQUHIHUUHGWRDVWKHHOHFWURPRWLYHIRUFHµ(0)¶VHULHVµ(0)¶VHULHVFDQEHIRXQG RIWHQUHIHUUHGWRDVWKHHOHFWURPRWLYHIRUFHµ(0)¶VHULHVµ(0)¶VHULHVFDQEHIRXQG
LQWKHOLWHUDWXUHHJ>-RQHV%DUGDO@*HQHUDOO\KDOIFHOOUHDFWLRQVLQWKH LQWKHOLWHUDWXUHHJ>-RQHV%DUGDO@*HQHUDOO\KDOIFHOOUHDFWLRQVLQWKH
µ(0)¶VHULHVDUHZULWWHQIURPWKHOHIWWRWKHULJKWDVUHGXFWLRQSRWHQWLDOVYHUVXVµ6+(¶ µ(0)¶VHULHVDUHZULWWHQIURPWKHOHIWWRWKHULJKWDVUHGXFWLRQSRWHQWLDOVYHUVXVµ6+(¶
LQDFFRUGDQFHZLWKWKHVLJQFRQYHQWLRQVGHILQHGLQ6HFWLRQ DQGVRUWHGDFFRUG LQDFFRUGDQFHZLWKWKHVLJQFRQYHQWLRQVGHILQHGLQ6HFWLRQ DQGVRUWHGDFFRUG
LQJWRWKHLUDELOLW\WREHUHGXFHGLHIURPQREOHWRDFWLYHUHGXFWLRQSRWHQWLDOV,QDF LQJWRWKHLUDELOLW\WREHUHGXFHGLHIURPQREOHWRDFWLYHUHGXFWLRQSRWHQWLDOV,QDF
FRUGDQFHZLWK>$670*@WKHXSSHUERXQGDU\LVUHIHUUHGWRDVQREOHDQGWKH FRUGDQFHZLWK>$670*@WKHXSSHUERXQGDU\LVUHIHUUHGWRDVQREOHDQGWKH
ORZHUERXQGDU\LVUHIHUUHGWRDVDFWLYHLQWKHSUHVHQWWKHVLV FI&KDSWHUµ7D'¶  ORZHUERXQGDU\LVUHIHUUHGWRDVDFWLYHLQWKHSUHVHQWWKHVLV FI&KDSWHUµ7D'¶ 
,Q WKH IROORZLQJ VHOHFWHG KDOIFHOO UHDFWLRQV RI UHOHYDQFH LQ WKLV WKHVLV  DUH OLVWHG ,Q WKH IROORZLQJ VHOHFWHG KDOIFHOO UHDFWLRQV RI UHOHYDQFH LQ WKLV WKHVLV  DUH OLVWHG
DFFRUGLQJWRWKHLUDELOLW\WREHUHGXFHG WRJHWKHUZLWKWKHLUFDOFXODWHGµ(¶DQGWKHLU DFFRUGLQJWRWKHLUDELOLW\WREHUHGXFHG WRJHWKHUZLWKWKHLUFDOFXODWHGµ(¶DQGWKHLU
OLWHUDWXUHµ(¶>-RQHV@ OLWHUDWXUHµ(¶>-RQHV@
‡ 5HGXFWLRQRIR[\JHQLQDFLGVROXWLRQV ‡ 5HGXFWLRQRIR[\JHQLQDFLGVROXWLRQV

 2 + + + + H − → + 2 (( 
 =  {} P96+( )  >@  2 + + + + H − → + 2 (( 
 =  {} P96+( )  >@

‡ 5HGXFWLRQRIIHUULFLRQ ‡ 5HGXFWLRQRIIHUULFLRQ

 )H+ + H − → )H  + (( 
 =  {} P96+( )  >@  )H+ + H − → )H  + (( 
 =  {} P96+( )  >@

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

‡ 5HGXFWLRQRIFXSULFLRQ ‡ 5HGXFWLRQRIFXSULFLRQ

 &X + + H − → &X (( 
 =  ^` P96+( )  >@  &X + + H − → &X (( 
 =  ^` P96+( )  >@

‡ 5HGXFWLRQRIK\GURJHQLRQLQDFLGVROXWLRQV ‡ 5HGXFWLRQRIK\GURJHQLRQLQDFLGVROXWLRQV

 + + + H − → +  (( 
 =  P96+( )  >@  + + + H − → +  (( 
 =  P96+( )  >@

‡ 5HGXFWLRQRIQLFNHORXVLRQ ‡ 5HGXFWLRQRIQLFNHORXVLRQ

 1L  + + H − → 1L (( 
 −  {−} P96+( )  >@  1L  + + H − → 1L (( 
 −  {−} P96+( )  >@

‡ 5HGXFWLRQRIIHUURXVLRQ ‡ 5HGXFWLRQRIIHUURXVLRQ

 )H + + H− → )H (( 
 −  {−} P96+( )  >@  )H + + H− → )H (( 
 −  {−} P96+( )  >@

‡ 5HGXFWLRQRIFKURPLFLRQ ‡ 5HGXFWLRQRIFKURPLFLRQ

 &U + + H− → &U (( 


 −  {−} P96+( )  >@  &U + + H− → &U (( 
 −  {−} P96+( )  >@

‡ 5HGXFWLRQRI]LQFLRQ ‡ 5HGXFWLRQRI]LQFLRQ

 =Q  + + H − → =Q (( 
 = −  {−} P96+( )  >@  =Q  + + H − → =Q (( 
 = −  {−} P96+( )  >@

‡ 5HGXFWLRQRIFKURPRXVLRQ  ‡ 5HGXFWLRQRIFKURPRXVLRQ 

 &U + + H − → &U (( 
 = −  P96+( )  >@  &U + + H − → &U (( 
 = −  P96+( )  >@

‡ 5HGXFWLRQRIPDJQHVLXPLRQ ‡ 5HGXFWLRQRIPDJQHVLXPLRQ

 0J + + H − → 0J (( 
 = −  {−} P96+( )  >@  0J + + H − → 0J (( 
 = −  {−} P96+( )  >@

7KHWZRKDOIFHOOUHDFWLRQVGHVFULELQJWKHUHGXFWLRQRIR[\JHQ>@DQGRIK\GURJHQ 7KHWZRKDOIFHOOUHDFWLRQVGHVFULELQJWKHUHGXFWLRQRIR[\JHQ>@DQGRIK\GURJHQ
>@LOOXVWUDWHWKDWK\GURJHQLRQVDUHQHFHVVDU\IRUWKHUHDFWLRQVWRWDNHSODFH6XIIL >@LOOXVWUDWHWKDWK\GURJHQLRQVDUHQHFHVVDU\IRUWKHUHDFWLRQVWRWDNHSODFH6XIIL
FLHQWVXSSO\RI+LVSURYLGHGLQDFLGVROXWLRQVRQO\EXWERWKUHDFWLRQVFDQDOVRWDNH FLHQWVXSSO\RI+LVSURYLGHGLQDFLGVROXWLRQVRQO\EXWERWKUHDFWLRQVFDQDOVRWDNH
SODFHLQQHXWUDORUDONDOLQHVROXWLRQVDVWKH\FDQEHVXSSRUWHGE\FRQWLQXRXVGLVVRFLD SODFHLQQHXWUDORUDONDOLQHVROXWLRQVDVWKH\FDQEHVXSSRUWHGE\FRQWLQXRXVGLVVRFLD
WLRQRIZDWHU WLRQRIZDWHU

+  2 → + + + 2+ − ( Δ* 
=  N- )  >@ +  2 → + + + 2+ − ( Δ* 
=  N- )  >@

$GGLQJWKHGLVVRFLDWLRQRIZDWHU>@WRR[\JHQUHGXFWLRQ>@OHDGVWRWKHKDOI $GGLQJWKHGLVVRFLDWLRQRIZDWHU>@WRR[\JHQUHGXFWLRQ>@OHDGVWRWKHKDOI
FHOO UHDFWLRQ GHVFULELQJ UHGXFWLRQ RI GLVVROYHG R[\JHQ LQ QHXWUDO DQG DONDOLQH FHOO UHDFWLRQ GHVFULELQJ UHGXFWLRQ RI GLVVROYHG R[\JHQ LQ QHXWUDO DQG DONDOLQH
VROXWLRQVZKLFKZDVDOUHDG\PHQWLRQHGLQ6HFWLRQ VROXWLRQVZKLFKZDVDOUHDG\PHQWLRQHGLQ6HFWLRQ

2 + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@ 2 + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@
 

5HGXFWLRQRIFKURPRXVLRQLVQRUPDOO\QRWLQFOXGHGLQVWDQGDUGµ(0)¶VHULHVLQWKHOLWHUDWXUHHJ 5HGXFWLRQRIFKURPRXVLRQLVQRUPDOO\QRWLQFOXGHGLQVWDQGDUGµ(0)¶VHULHVLQWKHOLWHUDWXUHHJ
>-RQHV%DUGDO@7KLVLVSUREDEO\GXHWRWKHIDFWWKDWLWLVHDVLO\R[LGLVHGWRFKURPLFLRQ >-RQHV%DUGDO@7KLVLVSUREDEO\GXHWRWKHIDFWWKDWLWLVHDVLO\R[LGLVHGWRFKURPLFLRQ
+RZHYHUZHWKLQNWKDWFKURPRXVLRQFDQSOD\DQLPSRUWDQWUROHLQFUHYLFHFRUURVLRQ FI6HFWLRQ +RZHYHUZHWKLQNWKDWFKURPRXVLRQFDQSOD\DQLPSRUWDQWUROHLQFUHYLFHFRUURVLRQ FI6HFWLRQ
 RIVWDLQOHVVVWHHODQGLWLVWKXVLQFOXGHGLQWKLVOLVW  RIVWDLQOHVVVWHHODQGLWLVWKXVLQFOXGHGLQWKLVOLVW

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

6LPLODUO\DGGLQJ>@WRK\GURJHQLRQUHGXFWLRQ>@OHDGVWRWKHKDOIFHOOUHDF 6LPLODUO\DGGLQJ>@WRK\GURJHQLRQUHGXFWLRQ>@OHDGVWRWKHKDOIFHOOUHDF
WLRQGHVFULELQJWKHUHGXFWLRQRIZDWHULQQHXWUDODQGDONDOLQHVROXWLRQV WLRQGHVFULELQJWKHUHGXFWLRQRIZDWHULQQHXWUDODQGDONDOLQHVROXWLRQV

+  2 + H− → +  + 2+ − (( 
 = −  ^−` P96+( )  >@ +  2 + H− → +  + 2+ − (( 
 = −  ^−` P96+( )  >@

2QFHPRUHLWVKRXOGEHHPSKDVLVHGWKDW LQDFFRUGDQFHZLWK6HFWLRQ DQHOHF 2QFHPRUHLWVKRXOGEHHPSKDVLVHGWKDW LQDFFRUGDQFHZLWK6HFWLRQ DQHOHF


WURGHSRWHQWLDOµ(¶ORZHUWKDQµ(¶PHDQVWKDWWKHDVVRFLDWHGKDOIFHOOUHDFWLRQWDNHV WURGHSRWHQWLDOµ(¶ORZHUWKDQµ(¶PHDQVWKDWWKHDVVRFLDWHGKDOIFHOOUHDFWLRQWDNHV
SODFH LQ WKH UHGXFWLRQ GLUHFWLRQ ZKHUHDV D KLJKHU µ(¶ PHDQV WKDW WKH UHDFWLRQ WDNHV SODFH LQ WKH UHGXFWLRQ GLUHFWLRQ ZKHUHDV D KLJKHU µ(¶ PHDQV WKDW WKH UHDFWLRQ WDNHV
SODFHLQWKHR[LGDWLRQGLUHFWLRQ SODFHLQWKHR[LGDWLRQGLUHFWLRQ
7KHDERYHOLVWHGUHDFWLRQVDQGVWDQGDUGSRWHQWLDOVDUHRQO\YDOLGIRUWKHDFWLYHFRUUR 7KHDERYHOLVWHGUHDFWLRQVDQGVWDQGDUGSRWHQWLDOVDUHRQO\YDOLGIRUWKHDFWLYHFRUUR
VLRQVWDWH0RUHRYHUWKHOLVWHGHTXLOLEULXPSRWHQWLDOVRQO\UHIOHFWVWDQGDUGVWDWHFRQ VLRQVWDWH0RUHRYHUWKHOLVWHGHTXLOLEULXPSRWHQWLDOVRQO\UHIOHFWVWDQGDUGVWDWHFRQ
GLWLRQVZKLFKLV LQSDUWLFXODUZLWKUHJDUGWRS+YDULDWLRQV DPDMRUOLPLWDWLRQLQWKH GLWLRQVZKLFKLV LQSDUWLFXODUZLWKUHJDUGWRS+YDULDWLRQV DPDMRUOLPLWDWLRQLQWKH
LQIRUPDWLRQ SURYLGHG LQWKH µ(0)¶ VHULHV 7KH OLWHUDWXUH RQ UHLQIRUFHPHQW FRUURVLRQ LQIRUPDWLRQ SURYLGHG LQWKH µ(0)¶ VHULHV 7KH OLWHUDWXUH RQ UHLQIRUFHPHQW FRUURVLRQ
GRHVJHQHUDOO\QRWSURYLGHµ(0)¶VHULHVZKLFKPLJKWEHGXHWRWKHDERYHPHQWLRQHG GRHVJHQHUDOO\QRWSURYLGHµ(0)¶VHULHVZKLFKPLJKWEHGXHWRWKHDERYHPHQWLRQHG
OLPLWDWLRQV+RZHYHUUHVWULFWLRQVZLWKUHJDUGWRVWDQGDUGVWDWHFRQGLWLRQVFDQEHFRQ OLPLWDWLRQV+RZHYHUUHVWULFWLRQVZLWKUHJDUGWRVWDQGDUGVWDWHFRQGLWLRQVFDQEHFRQ
YHQLHQWO\DGGUHVVHGE\DSSO\LQJWKH1HUQVWHTXDWLRQ FI6HFWLRQ WRYHULI\SR YHQLHQWO\DGGUHVVHGE\DSSO\LQJWKH1HUQVWHTXDWLRQ FI6HFWLRQ WRYHULI\SR
WHQWLDOUDQJHVDWDFHUWDLQS+RIFRQFHUQLHIRUQRQVWDQGDUGVWDWHV WHQWLDOUDQJHVDWDFHUWDLQS+RIFRQFHUQLHIRUQRQVWDQGDUGVWDWHV
7KH 3RXUEDL[ GLDJUDP FI 6HFWLRQ   RYHUFRPHV ERWK OLPLWDWLRQV DQG DOORZV 7KH 3RXUEDL[ GLDJUDP FI 6HFWLRQ   RYHUFRPHV ERWK OLPLWDWLRQV DQG DOORZV
FRQVLGHUDWLRQV RQ WKH SRVVLEOH UHDFWLRQV GHSHQGLQJ RQ µ(¶ DQG S+  WR HYDOXDWH WKH FRQVLGHUDWLRQV RQ WKH SRVVLEOH UHDFWLRQV GHSHQGLQJ RQ µ(¶ DQG S+  WR HYDOXDWH WKH
IRUPDWLRQRIDQ\DQRGLFFRUURVLRQSURGXFW LQFOXGLQJSDVVLYHFRPSRXQGVFI6HFWLRQ IRUPDWLRQRIDQ\DQRGLFFRUURVLRQSURGXFW LQFOXGLQJSDVVLYHFRPSRXQGVFI6HFWLRQ
 RUWKHUHGXFWLRQRIR[LGLVHGVSHFLHV  RUWKHUHGXFWLRQRIR[LGLVHGVSHFLHV
0RUHRYHULWVKRXOGEHHPSKDVLVHGWKDWµ(¶UHTXLUHGIRUDQ\KDOIFHOOUHDFWLRQWRRFFXU 0RUHRYHULWVKRXOGEHHPSKDVLVHGWKDWµ(¶UHTXLUHGIRUDQ\KDOIFHOOUHDFWLRQWRRFFXU
LVODUJHO\DIIHFWHGE\YDULRXVNLQHWLFDVSHFWV(VSHFLDOO\RYHUSRWHQWLDOV KDYHDODUJH LVODUJHO\DIIHFWHGE\YDULRXVNLQHWLFDVSHFWV(VSHFLDOO\RYHUSRWHQWLDOV KDYHDODUJH
HIIHFWRQµ(¶UHTXLUHGIRUR[\JHQDQGK\GURJHQLRQUHGXFWLRQWRWDNHSODFHDVFDWKRGLF HIIHFWRQµ(¶UHTXLUHGIRUR[\JHQDQGK\GURJHQLRQUHGXFWLRQWRWDNHSODFHDVFDWKRGLF
UHDFWLRQ7KHWKHRUHWLFDOEDFNJURXQGRIRYHUSRWHQWLDOVDQGWKHLUSUDFWLFDOPHDQLQJDUH UHDFWLRQ7KHWKHRUHWLFDOEDFNJURXQGRIRYHUSRWHQWLDOVDQGWKHLUSUDFWLFDOPHDQLQJDUH
GLVFXVVHGLQ6HFWLRQVDQG,QVRPHOLWHUDWXUHWKHRYHUSRWHQWLDOLVSDUWO\DF GLVFXVVHGLQ6HFWLRQVDQG,QVRPHOLWHUDWXUHWKHRYHUSRWHQWLDOLVSDUWO\DF
NQRZOHGJHG ZKHQ VWDWLQJ UHDFWLRQ HTXDWLRQV )RU LQVWDQFH IRU WKH IUHTXHQWO\ FLWHG NQRZOHGJHG ZKHQ VWDWLQJ UHDFWLRQ HTXDWLRQV )RU LQVWDQFH IRU WKH IUHTXHQWO\ FLWHG
KDOIFHOOUHDFWLRQGHVFULELQJWKHUHGXFWLRQRIK\GURJHQLQDFLGVROXWLRQV>@+LV KDOIFHOOUHDFWLRQGHVFULELQJWKHUHGXFWLRQRIK\GURJHQLQDFLGVROXWLRQV>@+LV
RIWHQUHSODFHGE\ µ+DG¶ RU µ+DGV¶ WRDFNQRZOHGJHWKHIRUPDWLRQRIDQDGVRUEHGK\ RIWHQUHSODFHGE\ µ+DG¶ RU µ+DGV¶ WRDFNQRZOHGJHWKHIRUPDWLRQRIDQDGVRUEHGK\
GURJHQDWRPSULRUWRIRUPDWLRQRIDK\GURJHQPROHFXOH7KLVDVSHFWVXUHO\UHSUHVHQWV GURJHQDWRPSULRUWRIRUPDWLRQRIDK\GURJHQPROHFXOH7KLVDVSHFWVXUHO\UHSUHVHQWV
D PDMRU FRQWULEXWLRQ LQ WKH PDJQLWXGH RI WKH K\GURJHQ RYHUSRWHQWLDO +RZHYHU WKLV D PDMRU FRQWULEXWLRQ LQ WKH PDJQLWXGH RI WKH K\GURJHQ RYHUSRWHQWLDO +RZHYHU WKLV
QRWDWLRQ LV RPLWWHG LQ WKLV WKHVLV DV WKHUH DUH RWKHU VWHSV LQYROYHG LQ WKH UHDFWLRQ QRWDWLRQ LV RPLWWHG LQ WKLV WKHVLV DV WKHUH DUH RWKHU VWHSV LQYROYHG LQ WKH UHDFWLRQ
ZKLFK DOVR FRQWULEXWH WR WKH PDJQLWXGH RI K\GURJHQ RYHUSRWHQWLDOV FI 6HFWLRQ ZKLFK DOVR FRQWULEXWH WR WKH PDJQLWXGH RI K\GURJHQ RYHUSRWHQWLDOV FI 6HFWLRQ
 6RWKURXJKRXWWKHSUHVHQWWKHVLVRQO\³FRPSOHWH´UHDFWLRQVDUHVWDWHGZKLOH  6RWKURXJKRXWWKHSUHVHQWWKHVLVRQO\³FRPSOHWH´UHDFWLRQVDUHVWDWHGZKLOH
WKHFRQWULEXWLRQRIRYHUSRWHQWLDOVLVNHSWLQPLQG WKHFRQWULEXWLRQRIRYHUSRWHQWLDOVLVNHSWLQPLQG
%DVHGRQWKHDERYHOLVWHGKDOIFHOOUHDFWLRQVLQGLFDWLYHFRQFOXVLRQVIRUDPHWDO¶VDI %DVHGRQWKHDERYHOLVWHGKDOIFHOOUHDFWLRQVLQGLFDWLYHFRQFOXVLRQVIRUDPHWDO¶VDI
ILQLW\WREHR[LGLVHGRUUHGXFHGE\DQ\RWKHUPHWDORUHQYLURQPHQWFDQEHGUDZQIRU ILQLW\WREHR[LGLVHGRUUHGXFHGE\DQ\RWKHUPHWDORUHQYLURQPHQWFDQEHGUDZQIRU
WKHVWDQGDUGVWDWH7KHKLJKHUµ(¶WKHHDVLHUWKHVSHFLHVLVUHGXFHGLHWKHPHWDORU WKHVWDQGDUGVWDWH7KHKLJKHUµ(¶WKHHDVLHUWKHVSHFLHVLVUHGXFHGLHWKHPHWDORU

 

7KHWHUPRYHUSRWHQWLDOLVLQWKHOLWHUDWXUHFRPPRQO\UHIHUUHGWRDVRYHUYROWDJH:HSUHIHUWRUHIHUWR 7KHWHUPRYHUSRWHQWLDOLVLQWKHOLWHUDWXUHFRPPRQO\UHIHUUHGWRDVRYHUYROWDJH:HSUHIHUWRUHIHUWR
LWDVRYHUSRWHQWLDOEHFDXVHWKLVWHUPLVPRUHFRQVLVWHQWZLWKWKHWHUPSRWHQWLDO LWDVRYHUSRWHQWLDOEHFDXVHWKLVWHUPLVPRUHFRQVLVWHQWZLWKWKHWHUPSRWHQWLDO

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

HQYLURQPHQWLVDEHWWHUR[LGDQW7KHORZHUµ(¶WKHHDVLHUWKHVSHFLHVLVR[LGLVHGLH HQYLURQPHQWLVDEHWWHUR[LGDQW7KHORZHUµ(¶WKHHDVLHUWKHVSHFLHVLVR[LGLVHGLH
WKHPHWDORUHQYLURQPHQWLVDEHWWHUUHGXFWDQW WKHPHWDORUHQYLURQPHQWLVDEHWWHUUHGXFWDQW
)RU H[DPSOH IHUULF LRQ LV UHGXFHG DW  P96+( DQG PDJQHVLXP LRQ LV UHGXFHG DW )RU H[DPSOH IHUULF LRQ LV UHGXFHG DW  P96+( DQG PDJQHVLXP LRQ LV UHGXFHG DW
í P96+( 6R IHUULF LRQ LV HDVLO\ UHGXFHG DQG WKXV LV D JRRG R[LGDQW ZKHUHDV í P96+( 6R IHUULF LRQ LV HDVLO\ UHGXFHG DQG WKXV LV D JRRG R[LGDQW ZKHUHDV
PDJQHVLXP UDWKHU XQGHUJRHV R[LGDWLRQ DQG WKXV LV D JRRG UHGXFWDQW =LQF LRQ ZLWK PDJQHVLXP UDWKHU XQGHUJRHV R[LGDWLRQ DQG WKXV LV D JRRG UHGXFWDQW =LQF LRQ ZLWK
µ(¶HTXDOWRíP96+(LVR[LGLVHGE\DQ\RWKHUPHWDORUHQYLURQPHQWZLWKµ(¶ µ(¶HTXDOWRíP96+(LVR[LGLVHGE\DQ\RWKHUPHWDORUHQYLURQPHQWZLWKµ(¶
KLJKHUWKDQíP96+( HJR[\JHQIHUULFLRQDQGIHUURXVLRQ DQGUHGXFHGE\DQ\ KLJKHUWKDQíP96+( HJR[\JHQIHUULFLRQDQGIHUURXVLRQ DQGUHGXFHGE\DQ\
RWKHUPHWDORUHQYLURQPHQWZLWKµ(¶ORZHUWKDQíP96+( HJPDJQHVLXP $W RWKHUPHWDORUHQYLURQPHQWZLWKµ(¶ORZHUWKDQíP96+( HJPDJQHVLXP $W
WKHVDPHWLPH]LQFDQGHYHQPRUHPDJQHVLXPKDYHDKLJKDIILQLW\WRUHGXFHR[\JHQ WKHVDPHWLPH]LQFDQGHYHQPRUHPDJQHVLXPKDYHDKLJKDIILQLW\WRUHGXFHR[\JHQ
6RPHRIWKHVH VLPSOLILHGSULPDU\LQGLFDWLRQVZHUHRILPSRUWDQFHLQWKHGHYHORSPHQW 6RPHRIWKHVH VLPSOLILHGSULPDU\LQGLFDWLRQVZHUHRILPSRUWDQFHLQWKHGHYHORSPHQW
RIWKHSURSRVHGQHZFRXQWHUPHDVXUHV FI&KDSWHU  RIWKHSURSRVHGQHZFRXQWHUPHDVXUHV FI&KDSWHU 
,WVKRXOGDOVREHUHPDUNHGWKDWWKHDELOLW\WREHUHGXFHG WKHFRUURVLRQWHQGHQF\ GRHV ,WVKRXOGDOVREHUHPDUNHGWKDWWKHDELOLW\WREHUHGXFHG WKHFRUURVLRQWHQGHQF\ GRHV
JHQHUDOO\ QRWDOORZFRQFOXVLRQVRQWKHFRUURVLRQUDWHRIWKHDVVRFLDWHGPHWDO)RULQ JHQHUDOO\ QRWDOORZFRQFOXVLRQVRQWKHFRUURVLRQUDWHRIWKHDVVRFLDWHGPHWDO)RULQ
VWDQFH µ(¶ RI ]LQF í P96+(  LV PXFK ORZHU WKDQ µ(¶ RI IHUURXV LRQ í VWDQFH µ(¶ RI ]LQF í P96+(  LV PXFK ORZHU WKDQ µ(¶ RI IHUURXV LRQ í
P96+( DQG]LQFFRXOGEHH[SHFWHGWRFRUURGHDWDKLJKHUUDWHWKDQLURQDVLWLVR[L P96+( DQG]LQFFRXOGEHH[SHFWHGWRFRUURGHDWDKLJKHUUDWHWKDQLURQDVLWLVR[L
GLVHG PXFK HDVLHU +RZHYHU DV GLVFXVVHG LQ PRUH GHWDLO LQ 6HFWLRQ  WKH H[ GLVHG PXFK HDVLHU +RZHYHU DV GLVFXVVHG LQ PRUH GHWDLO LQ 6HFWLRQ  WKH H[
FKDQJHFXUUHQWGHQVLW\RI]LQFLVPXFKORZHUWKDQWKHRQHRILURQDQGKHQFH]LQFFRU FKDQJHFXUUHQWGHQVLW\RI]LQFLVPXFKORZHUWKDQWKHRQHRILURQDQGKHQFH]LQFFRU
URGHVDWDPXFKORZHUUDWH URGHVDWDPXFKORZHUUDWH
7KHOLVWRIKDOIFHOOUHDFWLRQVDQGVWDQGDUGSRWHQWLDOVDOVRDOORZVVRPHJHQHUDOFRQFOX 7KHOLVWRIKDOIFHOOUHDFWLRQVDQGVWDQGDUGSRWHQWLDOVDOVRDOORZVVRPHJHQHUDOFRQFOX
VLRQVFRQFHUQLQJWKHFRUURVLRQSRWHQWLDOµ(FRUU¶ FI&KDSWHUµ7D'¶ HJWRGHWHUPLQH VLRQVFRQFHUQLQJWKHFRUURVLRQSRWHQWLDOµ(FRUU¶ FI&KDSWHUµ7D'¶ HJWRGHWHUPLQH
WKHSUHIHUHQWLDOO\FRUURGHGPHWDOLIWZRGLVVLPLODUPHWDOVDUHVXEPHUJHGLQDQHOHF WKHSUHIHUHQWLDOO\FRUURGHGPHWDOLIWZRGLVVLPLODUPHWDOVDUHVXEPHUJHGLQDQHOHF
WURO\WHDQGHOHFWULFDOO\ FRQQHFWHG LHD JDOYDQLFFHOO <HWLWVKRXOGEHHPSKDVLVHG WURO\WHDQGHOHFWULFDOO\ FRQQHFWHG LHD JDOYDQLFFHOO <HWLWVKRXOGEHHPSKDVLVHG
RQFHPRUHWKDWWKHDERYHOLVWHGHTXLOLEULXPSRWHQWLDOVDUHOLPLWHGWRDFWLYHFRUURVLRQ RQFHPRUHWKDWWKHDERYHOLVWHGHTXLOLEULXPSRWHQWLDOVDUHOLPLWHGWRDFWLYHFRUURVLRQ
LQWKHVWDQGDUGVWDWHDQGGRQRUPDOO\QRWUHIOHFWWKHDFWXDOVWDWHRIDPHWDOLQDFHUWDLQ LQWKHVWDQGDUGVWDWHDQGGRQRUPDOO\QRWUHIOHFWWKHDFWXDOVWDWHRIDPHWDOLQDFHUWDLQ
HQYLURQPHQW7KLVLVRISDUWLFXODULPSRUWDQFHZLWKUHJDUGWRZKHWKHURUQRWSDVVLYD HQYLURQPHQW7KLVLVRISDUWLFXODULPSRUWDQFHZLWKUHJDUGWRZKHWKHURUQRWSDVVLYD
WLRQLVSRVVLEOH FI6HFWLRQ :KHQWKHSUHIHUHQWLDOO\FRUURGHGPHWDOLVWREHGH WLRQLVSRVVLEOH FI6HFWLRQ :KHQWKHSUHIHUHQWLDOO\FRUURGHGPHWDOLVWREHGH
WHUPLQHG HJ WR HVWLPDWH WKH HIIHFW RI JDOYDQLF FRXSOLQJ  FRQFOXVLRQV FDQQRW EH WHUPLQHG HJ WR HVWLPDWH WKH HIIHFW RI JDOYDQLF FRXSOLQJ  FRQFOXVLRQV FDQQRW EH
GUDZQ EDVHG RQ WKH µ(0)¶ VHULHV EXW WKH VRFDOOHG JDOYDQLF VHULHV IRU WKH HQYLURQ GUDZQ EDVHG RQ WKH µ(0)¶ VHULHV EXW WKH VRFDOOHG JDOYDQLF VHULHV IRU WKH HQYLURQ
PHQWLQTXHVWLRQLVWREHXVHG 2IWHQWKHJDOYDQLFVHULHVSURYLGHGLQWKHOLWHUDWXUHUH PHQWLQTXHVWLRQLVWREHXVHG 2IWHQWKHJDOYDQLFVHULHVSURYLGHGLQWKHOLWHUDWXUHUH
IHUWRVHDZDWHUFRQGLWLRQVHJ>-RQHV&DOOLVWHU &DOOLVWHU@,WLVLPSRU IHUWRVHDZDWHUFRQGLWLRQVHJ>-RQHV&DOOLVWHU &DOOLVWHU@,WLVLPSRU
WDQW WR HPSKDVLVH WKDW JDOYDQLF VHULHV DUH VWULFWO\ OLPLWHG WR RQH SDUWLFXODU HQYLURQ WDQW WR HPSKDVLVH WKDW JDOYDQLF VHULHV DUH VWULFWO\ OLPLWHG WR RQH SDUWLFXODU HQYLURQ
PHQWZKLFKVHHPVWREHRIWHQRYHUORRNHGLQWKHOLWHUDWXUH7KHFKDUDFWHULVWLFVRIWKH PHQWZKLFKVHHPVWREHRIWHQRYHUORRNHGLQWKHOLWHUDWXUH7KHFKDUDFWHULVWLFVRIWKH
HQYLURQPHQWGRQRWRQO\FRQFHUQWKHS+µ(FRUU¶DQGHJWKHFRQWHQWRIGHSDVVLYDWLQJ HQYLURQPHQWGRQRWRQO\FRQFHUQWKHS+µ(FRUU¶DQGHJWKHFRQWHQWRIGHSDVVLYDWLQJ
VSHFLHVDQ\SUHVHQWVXEVWDQFHWKDWLQWHUIHUHVZLWKWKHHOHFWURFKHPLVWU\RIWKHUHJDUGHG VSHFLHVDQ\SUHVHQWVXEVWDQFHWKDWLQWHUIHUHVZLWKWKHHOHFWURFKHPLVWU\RIWKHUHJDUGHG
PHWDOV KDV DQ LQIOXHQFH 7KH WKHRU\ EHKLQG WKH FRUURVLRQ SRWHQWLDO µ(FRUU¶ LH WKH PHWDOV KDV DQ LQIOXHQFH 7KH WKHRU\ EHKLQG WKH FRUURVLRQ SRWHQWLDO µ(FRUU¶ LH WKH
PL[HGSRWHQWLDOWKHRU\ LVRXWOLQHGLQ6HFWLRQDQGJDOYDQLFFRXSOLQJZLWKVSHFLDO PL[HGSRWHQWLDOWKHRU\ LVRXWOLQHGLQ6HFWLRQDQGJDOYDQLFFRXSOLQJZLWKVSHFLDO
IRFXVRQWKHFRQFUHWHHQYLURQPHQWLVGLVFXVVHGWKURXJKRXW&KDSWHUVDQG,QWKHVH IRFXVRQWKHFRQFUHWHHQYLURQPHQWLVGLVFXVVHGWKURXJKRXW&KDSWHUVDQG,QWKHVH

 

1HYHUWKHOHVVVRPHOLWHUDWXUHUHIHUVWRWKHµ(0)¶VHULHVZKHQVSHFLI\LQJWKHSUHIHUHQWLDOO\FRUURGHG 1HYHUWKHOHVVVRPHOLWHUDWXUHUHIHUVWRWKHµ(0)¶VHULHVZKHQVSHFLI\LQJWKHSUHIHUHQWLDOO\FRUURGHG
PHWDO HJWRFRQFOXGHRQWKHHIIHFWRIJDOYDQLFFRXSOLQJ  PHWDO HJWRFRQFOXGHRQWKHHIIHFWRIJDOYDQLFFRXSOLQJ 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

6HFWLRQVLWZLOODOVREHGHPRQVWUDWHGWKDW3RXUEDL[GLDJUDPV FI6HFWLRQ FDQ 6HFWLRQVLWZLOODOVREHGHPRQVWUDWHGWKDW3RXUEDL[GLDJUDPV FI6HFWLRQ FDQ


EHEHQHILFLDOO\XWLOLVHGLQLQYHVWLJDWLRQVRQWKHHIIHFWRIJDOYDQLFFRXSOLQJ EHEHQHILFLDOO\XWLOLVHGLQLQYHVWLJDWLRQVRQWKHHIIHFWRIJDOYDQLFFRXSOLQJ
:LWK UHJDUG WR µ(FRUU¶ WKH HOHFWURFKHPLFDO LQWHUDFWLRQ EHWZHHQ DQ DTXHRXV HQYLURQ :LWK UHJDUG WR µ(FRUU¶ WKH HOHFWURFKHPLFDO LQWHUDFWLRQ EHWZHHQ DQ DTXHRXV HQYLURQ
PHQWDQGDPHWDOVXUIDFH LHWKHPL[HGSRWHQWLDOHVWDEOLVKHGEHWZHHQWKHDVVRFLDWHG PHQWDQGDPHWDOVXUIDFH LHWKHPL[HGSRWHQWLDOHVWDEOLVKHGEHWZHHQWKHDVVRFLDWHG
DQRGLFDQGFDWKRGLFUHDFWLRQV LVHYHQPRUHLPSRUWDQWVLQFHLWEDVLFDOO\FRQFHUQVDOO DQRGLFDQGFDWKRGLFUHDFWLRQV LVHYHQPRUHLPSRUWDQWVLQFHLWEDVLFDOO\FRQFHUQVDOO
FRPPRQPHWDODSSOLFDWLRQV5HGXFLQJHQYLURQPHQWVORZHUµ(FRUU¶ZKHUHDVR[LGLVLQJ FRPPRQPHWDODSSOLFDWLRQV5HGXFLQJHQYLURQPHQWVORZHUµ(FRUU¶ZKHUHDVR[LGLVLQJ
HQYLURQPHQWVUDLVHLWZKLFKLVH[SODLQHGLQ6HFWLRQDQGGLVFXVVHGLQPRUHGHWDLO HQYLURQPHQWVUDLVHLWZKLFKLVH[SODLQHGLQ6HFWLRQDQGGLVFXVVHGLQPRUHGHWDLO
EDVHGRQFDUERQVWHHOLQ6HFWLRQ<HWWDNLQJWKLVLQIRUPDWLRQLQWRFRQVLGHUDWLRQ EDVHGRQFDUERQVWHHOLQ6HFWLRQ<HWWDNLQJWKLVLQIRUPDWLRQLQWRFRQVLGHUDWLRQ
SUHOLPLQDU\FRQFOXVLRQVFRQFHUQLQJFRUURVLRQSURWHFWLRQFDQDOVREHGUDZQEDVHGRQ SUHOLPLQDU\FRQFOXVLRQVFRQFHUQLQJFRUURVLRQSURWHFWLRQFDQDOVREHGUDZQEDVHGRQ
WKHDERYHOLVWHGVWDQGDUGSRWHQWLDOV)RULQVWDQFHUHODWLYHO\QREOHPHWDOV HJFRSSHU WKHDERYHOLVWHGVWDQGDUGSRWHQWLDOV)RULQVWDQFHUHODWLYHO\QREOHPHWDOV HJFRSSHU
DQGQLFNHODQGDOOR\VEDVHGRQWKHVHPHWDOV DUHJHQHUDOO\FRPSDWLEOHZLWKUHGXFLQJ DQGQLFNHODQGDOOR\VEDVHGRQWKHVHPHWDOV DUHJHQHUDOO\FRPSDWLEOHZLWKUHGXFLQJ
HQYLURQPHQWV,IDQ\RIWKHDERYHOLVWHGPHWDOVLVWREHXVHGLQR[LGLVLQJHQYLURQPHQW HQYLURQPHQWV,IDQ\RIWKHDERYHOLVWHGPHWDOVLVWREHXVHGLQR[LGLVLQJHQYLURQPHQW
KRZHYHU WKH FRUURVLRQ UHVLVWDQFH GHSHQGV XSRQ SDVVLYLW\ FI 6HFWLRQ   DV HJ KRZHYHU WKH FRUURVLRQ UHVLVWDQFH GHSHQGV XSRQ SDVVLYLW\ FI 6HFWLRQ   DV HJ
FKURPLXPRUFKURPLXPDOOR\VLQPDQ\DSSOLFDWLRQV FI6HFWLRQ $VLQGLFDWHG FKURPLXPRUFKURPLXPDOOR\VLQPDQ\DSSOLFDWLRQV FI6HFWLRQ $VLQGLFDWHG
LQ 6HFWLRQ  DOVR WKHGXUDELOLW\ RI FDUERQ VWHHO LQ LQWDFW DQG XQFRQWDPLQDWHG FRQ LQ 6HFWLRQ  DOVR WKHGXUDELOLW\ RI FDUERQ VWHHO LQ LQWDFW DQG XQFRQWDPLQDWHG FRQ
FUHWHLVEDVHGRQWKHIRUPDWLRQRIDSDVVLYHOD\HU1HYHUWKHOHVVKDOIFHOOUHDFWLRQVDQG FUHWHLVEDVHGRQWKHIRUPDWLRQRIDSDVVLYHOD\HU1HYHUWKHOHVVKDOIFHOOUHDFWLRQVDQG
WKH DVVRFLDWHG VWDQGDUG SRWHQWLDOV GHVFULELQJ SDVVLYLW\ DUH JHQHUDOO\ QRW LQFOXGHG LQ WKH DVVRFLDWHG VWDQGDUG SRWHQWLDOV GHVFULELQJ SDVVLYLW\ DUH JHQHUDOO\ QRW LQFOXGHG LQ
µ(0)¶VHULHV µ(0)¶VHULHV
+HQFH WKH µ(0)¶ VHULHV PD\ SURYLGH LQIRUPDWLRQ IRU OLPLWHG SUHOLPLQDU\ FRQFOX +HQFH WKH µ(0)¶ VHULHV PD\ SURYLGH LQIRUPDWLRQ IRU OLPLWHG SUHOLPLQDU\ FRQFOX
VLRQVEXWZHFRQVLGHULWWREHLQVXIILFLHQWIRUWKHGHVFULSWLRQRIFRUURVLRQSURFHVVHV VLRQVEXWZHFRQVLGHULWWREHLQVXIILFLHQWIRUWKHGHVFULSWLRQRIFRUURVLRQSURFHVVHV
DQG HYHQ PRUH DV D EDVLV IRU HYDOXDWLRQ RI H[LVWLQJ DQG GHVLJQ RI QHZ FRXQWHUPHD DQG HYHQ PRUH DV D EDVLV IRU HYDOXDWLRQ RI H[LVWLQJ DQG GHVLJQ RI QHZ FRXQWHUPHD
VXUHV :H VXJJHVW XVLQJ RWKHU PRUH UHILQHG WKHUPRG\QDPLF WRROV IRU WKHVH WDVNV LQ VXUHV :H VXJJHVW XVLQJ RWKHU PRUH UHILQHG WKHUPRG\QDPLF WRROV IRU WKHVH WDVNV LQ
SDUWLFXODUYHULILFDWLRQRIUHDFWLRQPHFKDQLVPV FI6HFWLRQ DQGFXVWRPLVHGDQG SDUWLFXODUYHULILFDWLRQRIUHDFWLRQPHFKDQLVPV FI6HFWLRQ DQGFXVWRPLVHGDQG
UHSUHVHQWDWLYH3RXUEDL[GLDJUDPV FI6HFWLRQVDQG  UHSUHVHQWDWLYH3RXUEDL[GLDJUDPV FI6HFWLRQVDQG 
)LQDOO\ D VKRUW QRWH RQ WKH WKHRU\ EHKLQG µ(¶ DQG WKH UHDVRQ IRU WKH GLIIHUHQFHV LQ )LQDOO\ D VKRUW QRWH RQ WKH WKHRU\ EHKLQG µ(¶ DQG WKH UHDVRQ IRU WKH GLIIHUHQFHV LQ
µ(¶ EHWZHHQ WKH GLYHUVH PHWDOV ,Q VLPSOH WHUPV WKH DWWDLQPHQW RI FHUWDLQ HTXLOLE µ(¶ EHWZHHQ WKH GLYHUVH PHWDOV ,Q VLPSOH WHUPV WKH DWWDLQPHQW RI FHUWDLQ HTXLOLE
ULXPSRWHQWLDOFRXOGEHXQGHUVWRRGDVIROORZV,IDPHWDOLVVXEPHUJHGLQDQHOHFWUR ULXPSRWHQWLDOFRXOGEHXQGHUVWRRGDVIROORZV,IDPHWDOLVVXEPHUJHGLQDQHOHFWUR
O\WHWKDWGRHVQRWFRQWDLQFDWLRQVRIWKLVPHWDOWKHPHWDOKDVWKHWHQGHQF\WRUHOHDVH O\WHWKDWGRHVQRWFRQWDLQFDWLRQVRIWKLVPHWDOWKHPHWDOKDVWKHWHQGHQF\WRUHOHDVH
LRQVLHWRGLVVROYH7KXVWKHPHWDOVXUIDFHEHFRPHVPRUHQHJDWLYHGXHWRWKHVXU LRQVLHWRGLVVROYH7KXVWKHPHWDOVXUIDFHEHFRPHVPRUHQHJDWLYHGXHWRWKHVXU
SOXVRIHOHFWURQV$WWKHVDPHWLPHWKHDFWLYLW\RISRVLWLYHPHWDOLRQVLQWKHOLTXLGLQ SOXVRIHOHFWURQV$WWKHVDPHWLPHWKHDFWLYLW\RISRVLWLYHPHWDOLRQVLQWKHOLTXLGLQ
FUHDVHVFDXVLQJDQLQFUHDVLQJQXPEHURIGLVVROYHGLRQVWREHGLVFKDUJHGRQWKHPHWDO FUHDVHVFDXVLQJDQLQFUHDVLQJQXPEHURIGLVVROYHGLRQVWREHGLVFKDUJHGRQWKHPHWDO
VXUIDFH 7KHVH SURFHVVHV FRQWLQXH XQWLO WKH WUDQVSRUW LV HTXDO LQ ERWK GLUHFWLRQV $W VXUIDFH 7KHVH SURFHVVHV FRQWLQXH XQWLO WKH WUDQVSRUW LV HTXDO LQ ERWK GLUHFWLRQV $W
WKLVVWDJHWKHPHWDOLVLQHTXLOLEULXPZLWKLWVRZQLRQVLQWKHVROXWLRQDQGKHQFHDWLWV WKLVVWDJHWKHPHWDOLVLQHTXLOLEULXPZLWKLWVRZQLRQVLQWKHVROXWLRQDQGKHQFHDWLWV
HTXLOLEULXPSRWHQWLDOµ(¶IRUWKHJLYHQLRQDFWLYLW\>-RQHV%DUGDO@ HTXLOLEULXPSRWHQWLDOµ(¶IRUWKHJLYHQLRQDFWLYLW\>-RQHV%DUGDO@
6RWKHGLIIHUHQFHVLQWKHµ(¶RIWKHPHWDOVFRXOGEHXQGHUVWRRGWREHEDVHGRQWKHGLI 6RWKHGLIIHUHQFHVLQWKHµ(¶RIWKHPHWDOVFRXOGEHXQGHUVWRRGWREHEDVHGRQWKHGLI
IHUHQWDELOLWLHVWREHGLVVROYHGZKLFKLVLQRXURSLQLRQDPRUHWDQJLEOHFRQFHSW)RU IHUHQWDELOLWLHVWREHGLVVROYHGZKLFKLVLQRXURSLQLRQDPRUHWDQJLEOHFRQFHSW)RU
LQVWDQFHPDJQHVLXPKDVDVWURQJDELOLW\WREHGLVVROYHG7KXVPDJQHVLXPKDVWREH LQVWDQFHPDJQHVLXPKDVDVWURQJDELOLW\WREHGLVVROYHG7KXVPDJQHVLXPKDVWREH
FKDUJHGUHODWLYHO\QHJDWLYHLHKDVWREHDWUHODWLYHO\DFWLYHSRWHQWLDOWREDODQFHWKH FKDUJHGUHODWLYHO\QHJDWLYHLHKDVWREHDWUHODWLYHO\DFWLYHSRWHQWLDOWREDODQFHWKH
GLVVROXWLRQRIFDWLRQVZLWKWKHGLVFKDUJHRIFDWLRQVIURPWKHHOHFWURO\WHRQWKHVXUIDFH GLVVROXWLRQRIFDWLRQVZLWKWKHGLVFKDUJHRIFDWLRQVIURPWKHHOHFWURO\WHRQWKHVXUIDFH

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

 5HIHUHQFH(OHFWURGHV  5HIHUHQFH(OHFWURGHV


,Q SUDFWLFH HOHFWURGH SRWHQWLDOV DUH XVXDOO\ PHDVXUHG DJDLQVW RWKHU UHIHUHQFH HOHF ,Q SUDFWLFH HOHFWURGH SRWHQWLDOV DUH XVXDOO\ PHDVXUHG DJDLQVW RWKHU UHIHUHQFH HOHF
WURGHV WKDQ WKH µ6+(¶ )RU ODERUDWRU\ PHDVXUHPHQWV WKH µ6&(¶ PHUFXU\PHUFXU\ WURGHV WKDQ WKH µ6+(¶ )RU ODERUDWRU\ PHDVXUHPHQWV WKH µ6&(¶ PHUFXU\PHUFXU\
FKORULGH FDORPHO+J+J&O DQGWKHVLOYHUVLOYHUFKORULGH $J$J&O HOHFWURGHHJ FKORULGH FDORPHO+J+J&O DQGWKHVLOYHUVLOYHUFKORULGH $J$J&O HOHFWURGHHJ
IRUFDOLEUDWLRQSXUSRVHVLQS+EXIIHUHGVROXWLRQVDUHRIWHQXVHGGXHWRWKHLUFRQYHQ IRUFDOLEUDWLRQSXUSRVHVLQS+EXIIHUHGVROXWLRQVDUHRIWHQXVHGGXHWRWKHLUFRQYHQ
LHQFHDQGUHOLDELOLW\ )RUPHDVXUHPHQWVLQWKHDUHDRIUHLQIRUFHPHQWFRUURVLRQZKHUH LHQFHDQGUHOLDELOLW\ )RUPHDVXUHPHQWVLQWKHDUHDRIUHLQIRUFHPHQWFRUURVLRQZKHUH
UREXVW DQG RIWHQWLPHV HPEHGGDEOH FRQVWUXFWLRQ DUH IDYRXUHG RYHU KLJKHU SUHFLVLRQ UREXVW DQG RIWHQWLPHV HPEHGGDEOH FRQVWUXFWLRQ DUH IDYRXUHG RYHU KLJKHU SUHFLVLRQ
HJ WKH FRSSHUFXSULF VXOSKDWH &X&X62  HOHFWURGH >$670 & @ DQG WKH HJ WKH FRSSHUFXSULF VXOSKDWH &X&X62  HOHFWURGH >$670 & @ DQG WKH
PDQJDQHVHGLR[LGHPDQJDQHVHWULR[LGH 0Q20Q2 HOHFWURGH>$UXS 6¡UHQVHQ PDQJDQHVHGLR[LGHPDQJDQHVHWULR[LGH 0Q20Q2 HOHFWURGH>$UXS 6¡UHQVHQ
@SOD\DQLPSRUWDQWUROH7KHKDOIFHOOUHDFWLRQVFRUUHVSRQGLQJWRWKHVHUHIHUHQFH @SOD\DQLPSRUWDQWUROH7KHKDOIFHOOUHDFWLRQVFRUUHVSRQGLQJWRWKHVHUHIHUHQFH
HOHFWURGHVDUHOLVWHGEHORZWRJHWKHUZLWKWKHLUDVVRFLDWHGµ(¶DFFRUGLQJWRWKHLUDELO HOHFWURGHVDUHOLVWHGEHORZWRJHWKHUZLWKWKHLUDVVRFLDWHGµ(¶DFFRUGLQJWRWKHLUDELO
LW\WREHUHGXFHG LW\WREHUHGXFHG
‡ +DOIFHOOUHDFWLRQFRUUHVSRQGLQJWRWKH0Q20Q2HOHFWURGH ‡ +DOIFHOOUHDFWLRQFRUUHVSRQGLQJWRWKH0Q20Q2HOHFWURGH

 0Q2  + + + + H− → 0Q 2 + + 2 (( 


 =  P96+( )  >@  0Q2  + + + + H− → 0Q 2 + + 2 (( 
 =  P96+( )  >@

‡ +DOIFHOOUHDFWLRQFRUUHVSRQGLQJWRWKH&X&X62HOHFWURGH ‡ +DOIFHOOUHDFWLRQFRUUHVSRQGLQJWRWKH&X&X62HOHFWURGH

 &X62  + H − → &X + 62  − (( 
 =  {} P96+( )  >@  &X62  + H − → &X + 62  − (( 
 =  {} P96+( )  >@

‡ +DOIFHOOUHDFWLRQFRUUHVSRQGLQJWRWKHµ6&(¶ ‡ +DOIFHOOUHDFWLRQFRUUHVSRQGLQJWRWKHµ6&(¶

 +J  &O + H − → +J + &O− (( 


 =  {} P96+( )  >@  +J  &O + H − → +J + &O− (( 
 =  {} P96+( )  >@

‡ +DOIFHOOUHDFWLRQFRUUHVSRQGLQJWRWKH$J$J&OHOHFWURGH ‡ +DOIFHOOUHDFWLRQFRUUHVSRQGLQJWRWKH$J$J&OHOHFWURGH

 $J&O + H− = $J + &O − (( 
 =  {} P96+( )  >@  $J&O + H− = $J + &O − (( 
 =  {} P96+( )  >@

7KH DFWXDO HOHFWURGH SRWHQWLDO RI WKH µ6&(¶ LV VSHFLILHG WR P96+( >5$ E@ 7KH DFWXDO HOHFWURGH SRWHQWLDO RI WKH µ6&(¶ LV VSHFLILHG WR P96+( >5$ E@
DQGDFFRUGLQJO\VRPHZKDWORZHUWKDQWKHFDOFXODWHGµ(¶RIP96+(RIWKHDVVR DQGDFFRUGLQJO\VRPHZKDWORZHUWKDQWKHFDOFXODWHGµ(¶RIP96+(RIWKHDVVR
FLDWHGKDOIFHOOUHDFWLRQZKLFKLVFRQVLGHUHGWREHGXHWRWKHKLJKHUFKORULGHLRQDF FLDWHGKDOIFHOOUHDFWLRQZKLFKLVFRQVLGHUHGWREHGXHWRWKHKLJKHUFKORULGHLRQDF
WLYLW\DWVDWXUDWLRQ ODUJHUWKDQXQLW\ 7KHVDPHKROGVIRUWKH$J$J&OHOHFWURGHXVHG WLYLW\DWVDWXUDWLRQ ODUJHUWKDQXQLW\ 7KHVDPHKROGVIRUWKH$J$J&OHOHFWURGHXVHG
IRUFDOLEUDWLRQSXUSRVHVLQWKHH[SHULPHQWDOSDUWRIWKLVSURMHFW)RUDILOOLQJVROXWLRQ IRUFDOLEUDWLRQSXUSRVHVLQWKHH[SHULPHQWDOSDUWRIWKLVSURMHFW)RUDILOOLQJVROXWLRQ
RI0SRWDVVLXPFKORULGHVROXWLRQ .&O WKHHOHFWURGHSRWHQWLDORIWKLV HOHFWURGHLV RI0SRWDVVLXPFKORULGHVROXWLRQ .&O WKHHOHFWURGHSRWHQWLDORIWKLV HOHFWURGHLV
VSHFLILHGWRP96+(>5$D@FRPSDUHGWRWKHFDOFXODWHGµ(¶RIP96+( VSHFLILHGWRP96+(>5$D@FRPSDUHGWRWKHFDOFXODWHGµ(¶RIP96+(

 1HUQVW(TXDWLRQ  1HUQVW(TXDWLRQ


$VVKRZQLQ6HFWLRQWKHUHLVDGLVFUHSDQF\EHWZHHQWKHVWDQGDUGSRWHQWLDOµ(¶ $VVKRZQLQ6HFWLRQWKHUHLVDGLVFUHSDQF\EHWZHHQWKHVWDQGDUGSRWHQWLDOµ(¶
RI WKH KDOIFHOO UHDFWLRQV FRUUHVSRQGLQJ WR WKH UHIHUHQFH HOHFWURGHV DQG WKHLU DFWXDO RI WKH KDOIFHOO UHDFWLRQV FRUUHVSRQGLQJ WR WKH UHIHUHQFH HOHFWURGHV DQG WKHLU DFWXDO
HTXLOLEULXPSRWHQWLDOVµ(¶,QSULQFLSOHWKLVLVGXHWRWKHLRQDFWLYLWLHVRIWKHUHIHU HTXLOLEULXPSRWHQWLDOVµ(¶,QSULQFLSOHWKLVLVGXHWRWKHLRQDFWLYLWLHVRIWKHUHIHU
HQFHHOHFWURGHVGHYLDWLQJIURPWKHVWDQGDUGVWDWH FI&KDSWHUµ7D'¶ $OOHTXLOLEULXP HQFHHOHFWURGHVGHYLDWLQJIURPWKHVWDQGDUGVWDWH FI&KDSWHUµ7D'¶ $OOHTXLOLEULXP
SRWHQWLDOVIRUWKHKDOIFHOOUHDFWLRQV>@WR>@ZHUHVSHFLILHGIRUVWDQGDUGVWDWH SRWHQWLDOVIRUWKHKDOIFHOOUHDFWLRQV>@WR>@ZHUHVSHFLILHGIRUVWDQGDUGVWDWH
 

µ6&(¶DQG$J$J&OHOHFWURGHVKDYHDOVREHHQXVHGLQWKHH[SHULPHQWDOSDUWRIWKLVSURMHFW µ6&(¶DQG$J$J&OHOHFWURGHVKDYHDOVREHHQXVHGLQWKHH[SHULPHQWDOSDUWRIWKLVSURMHFW

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

FRQGLWLRQV +RZHYHU HOHFWURFKHPLFDO UHDFWLRQV JHQHUDOO\ WDNH SODFH XQGHU DUELWUDU\ FRQGLWLRQV +RZHYHU HOHFWURFKHPLFDO UHDFWLRQV JHQHUDOO\ WDNH SODFH XQGHU DUELWUDU\
LHQRQVWDQGDUGFRQGLWLRQV%HVLGHVYDULDWLRQVLQWKHLRQDFWLYLW\QRQVWDQGDUGVWDWH LHQRQVWDQGDUGFRQGLWLRQV%HVLGHVYDULDWLRQVLQWKHLRQDFWLYLW\QRQVWDQGDUGVWDWH
FRQGLWLRQV PDLQO\ LQYROYH YDULDWLRQV LQ WHPSHUDWXUH DQG WKH JDV SUHVVXUH IURP WKH FRQGLWLRQV PDLQO\ LQYROYH YDULDWLRQV LQ WHPSHUDWXUH DQG WKH JDV SUHVVXUH IURP WKH
VWDQGDUGVWDWHDVVSHFLILHGLQ&KDSWHUµ7D'¶(YHQLQWKHDUHDRIUHLQIRUFHPHQWFRUUR VWDQGDUGVWDWHDVVSHFLILHGLQ&KDSWHUµ7D'¶(YHQLQWKHDUHDRIUHLQIRUFHPHQWFRUUR
VLRQ ZKHUH JHQHUDOO\ RQO\ DPELHQW WHPSHUDWXUHV DUH RI FRQFHUQ DV RSSRVHG WR HJ VLRQ ZKHUH JHQHUDOO\ RQO\ DPELHQW WHPSHUDWXUHV DUH RI FRQFHUQ DV RSSRVHG WR HJ
KLJKWHPSHUDWXUH FRUURVLRQ  WKH LQIOXHQFH RI WKH WHPSHUDWXUH FDQ SOD\ D VLJQLILFDQW KLJKWHPSHUDWXUH FRUURVLRQ  WKH LQIOXHQFH RI WKH WHPSHUDWXUH FDQ SOD\ D VLJQLILFDQW
UROH FI6HFWLRQ 7KHJDVSUHVVXUHLVRISDUWLFXODUUHOHYDQFHZLWKUHJDUGWRFD UROH FI6HFWLRQ 7KHJDVSUHVVXUHLVRISDUWLFXODUUHOHYDQFHZLWKUHJDUGWRFD
WKRGLFUHDFWLRQVZKLFKDUHGLVFXVVHGLQPRUHGHWDLOWKURXJKRXW&KDSWHUVDQG WKRGLFUHDFWLRQVZKLFKDUHGLVFXVVHGLQPRUHGHWDLOWKURXJKRXW&KDSWHUVDQG
+RZHYHUIRUWKHSXUSRVHRIWKLVWKHVLVWKHPRVWLPSRUWDQWDVSHFWLVWKHLQIOXHQFHRI +RZHYHUIRUWKHSXUSRVHRIWKLVWKHVLVWKHPRVWLPSRUWDQWDVSHFWLVWKHLQIOXHQFHRI
WKH LRQ DFWLYLW\ RQ WKH WKHUPRG\QDPLFV RI WKH V\VWHP XQGHU LQYHVWLJDWLRQ ZKLFK LV WKH LRQ DFWLYLW\ RQ WKH WKHUPRG\QDPLFV RI WKH V\VWHP XQGHU LQYHVWLJDWLRQ ZKLFK LV
GLVFXVVHGWKURXJKRXW&KDSWHUVWR GLVFXVVHGWKURXJKRXW&KDSWHUVWR
7KHYDULDWLRQRIHTXLOLEULXPSRWHQWLDOVLQQRQVWDQGDUGVWDWHVLVWUHDWHGE\WKH1HUQVW 7KHYDULDWLRQRIHTXLOLEULXPSRWHQWLDOVLQQRQVWDQGDUGVWDWHVLVWUHDWHGE\WKH1HUQVW
HTXDWLRQ  7KH 1HUQVW HTXDWLRQ FDQ EH GHULYHG EDVHG RQ WKH H[SUHVVLRQ RI µǻ*¶ IRU HTXDWLRQ  7KH 1HUQVW HTXDWLRQ FDQ EH GHULYHG EDVHG RQ WKH H[SUHVVLRQ RI µǻ*¶ IRU
QRQVWDQGDUGVWDWHV FI6HFWLRQ  QRQVWDQGDUGVWDWHV FI6HFWLRQ 

§ D ( ) ( ) · § D ( ) ( ) ·
Y 3 Y 3] Y 3 Y 3]
×  × D 3] ×  × D 3]
Δ* = Δ* +  × 5 × 7 × ORJ ¨ ¸ Δ* = Δ* +  × 5 × 7 × ORJ ¨ ¸
 3  3
>@ >@
¨ D ¸ ¨ D ¸
( ) ×  × ( D ) ( ) ×  × ( D )
Y 5 Y5 ] Y 5 Y5 ]

© 5 5] ¹ © 5 5] ¹
,QVHUWLQJWKHWKHUPRG\QDPLFUHODWLRQEHWZHHQµǻ*¶DQGWKHUHGXFWLRQSRWHQWLDOµ(¶ ,QVHUWLQJWKHWKHUPRG\QDPLFUHODWLRQEHWZHHQµǻ*¶DQGWKHUHGXFWLRQSRWHQWLDOµ(¶
FI6HFWLRQ ZKLFKFDQEHUHZULWWHQDV FI6HFWLRQ ZKLFKFDQEHUHZULWWHQDV

Δ*  = − Q × ) × (   >@ Δ*  = − Q × ) × (   >@

LQWR>@HVWDEOLVKHVWKH1HUQVWHTXDWLRQ LQWR>@HVWDEOLVKHVWKH1HUQVWHTXDWLRQ

§ D ( ) ( ) · § D ( ) ( ) ·
Y 3 Y 3] Y 3 Y 3]
 × 5 × 7 ×  × D 3]  × 5 × 7 ×  × D 3]
× ORJ ¨ ¸ × ORJ ¨ ¸
 3  3
( ( − >@ ( ( − >@
¨ D ¸ ¨ D ¸
( ) ×  × ( D ) ( ) ×  × ( D )
 Y 5 Y5 ]  Y 5 Y5 ]
Q×) Q×)
© 5 5] ¹ © 5 5] ¹
7KXVWKH1HUQVWHTXDWLRQUHODWHVWKHHTXLOLEULXPSRWHQWLDOµ(¶IRUQRQVWDQGDUGVWDWHV 7KXVWKH1HUQVWHTXDWLRQUHODWHVWKHHTXLOLEULXPSRWHQWLDOµ(¶IRUQRQVWDQGDUGVWDWHV
WRµ(¶DQGWRWKHDFWLYLWLHVRIWKHSURGXFWVDQGUHDFWDQWVLQYROYHGLQWKHDVVRFLDWHG WRµ(¶DQGWRWKHDFWLYLWLHVRIWKHSURGXFWVDQGUHDFWDQWVLQYROYHGLQWKHDVVRFLDWHG
KDOIFHOOUHDFWLRQ KDOIFHOOUHDFWLRQ
,QFRUUHVSRQGHQFHZLWKWKHVLPSOLILFDWLRQRIWKHH[SUHVVLRQRIµǻ*¶IRUQRQVWDQGDUG ,QFRUUHVSRQGHQFHZLWKWKHVLPSOLILFDWLRQRIWKHH[SUHVVLRQRIµǻ*¶IRUQRQVWDQGDUG
VWDWHVDWDWHPSHUDWXUHµ7¶RIƒ& FI6HFWLRQ >@FDQEHZULWWHQDV VWDWHVDWDWHPSHUDWXUHµ7¶RIƒ& FI6HFWLRQ >@FDQEHZULWWHQDV

§ D ( ) ( ) · § D ( ) ( ) ·
Y 3 Y 3] Y 3 Y 3]
 ×  × D 3]  ×  × D 3]
× ORJ ¨ ¸ × ORJ ¨ ¸
 3  3
( = ( − >@ ( = ( − >@
¨ D ¸ ¨ D ¸
( ) ×  × ( D ) ( ) ×  × ( D )
 Y 5 Y5 ]  Y 5 Y5 ]
Q Q
© 5 5] ¹ © 5 5] ¹
ZKHUHLVDIDFWRUFUHDWHGIURP5×)×7>.@× WKHFRQYHUVLRQIDFWRUIURP ZKHUHLVDIDFWRUFUHDWHGIURP5×)×7>.@× WKHFRQYHUVLRQIDFWRUIURP
OQWRORJ )RUWKLVH[SUHVVLRQWKHVDPHDVVXPSWLRQVFRQFHUQLQJWKHDFWLYLWLHVµD¶IRU OQWRORJ )RUWKLVH[SUHVVLRQWKHVDPHDVVXPSWLRQVFRQFHUQLQJWKHDFWLYLWLHVµD¶IRU

 

1DPHGDIWHU:DOWKHU+HUPDQQ1HUQVW*HUPDQ\>5REHUJH@ 1DPHGDIWHU:DOWKHU+HUPDQQ1HUQVW*HUPDQ\>5REHUJH@

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

JDVHVVROLGVOLTXLGVDQGLRQV DVGHILQHGLQ6HFWLRQ DSSO\WKURXJKRXWWKLVWKH JDVHVVROLGVOLTXLGVDQGLRQV DVGHILQHGLQ6HFWLRQ DSSO\WKURXJKRXWWKLVWKH


VLV VLV
%HIRUHGLVFXVVLQJLQ6HFWLRQWKHWKHRU\RIWKH3RXUEDL[GLDJUDPZKLFKFDQEH %HIRUHGLVFXVVLQJLQ6HFWLRQWKHWKHRU\RIWKH3RXUEDL[GLDJUDPZKLFKFDQEH
XQGHUVWRRGDVDJUDSKLFDOUHSUHVHQWDWLRQRIWKH1HUQVWHTXDWLRQDQGWKHH[SUHVVLRQRI XQGHUVWRRGDVDJUDSKLFDOUHSUHVHQWDWLRQRIWKH1HUQVWHTXDWLRQDQGWKHH[SUHVVLRQRI
µǻ*¶ IRU QRQVWDQGDUG VWDWHV D WKHRUHWLFDOO\ DV ZHOO DV SUDFWLFDOO\ KLJKO\ LPSRUWDQW µǻ*¶ IRU QRQVWDQGDUG VWDWHV D WKHRUHWLFDOO\ DV ZHOO DV SUDFWLFDOO\ KLJKO\ LPSRUWDQW
DVSHFW RI WKHUPRG\QDPLFV WKH VWDWH RI SDVVLYLW\ DQG WKH EUHDNGRZQ RI SDVVLYLW\ LV DVSHFW RI WKHUPRG\QDPLFV WKH VWDWH RI SDVVLYLW\ DQG WKH EUHDNGRZQ RI SDVVLYLW\ LV
GHDOWZLWKLQ6HFWLRQ GHDOWZLWKLQ6HFWLRQ

 3DVVLYLW\DQG%UHDNGRZQRI3DVVLYLW\  3DVVLYLW\DQG%UHDNGRZQRI3DVVLYLW\


$V LQGLFDWHG LQ 6HFWLRQ  FDUERQ VWHHO LQ LQWDFW DQG XQFRQWDPLQDWHG FRQFUHWH LV $V LQGLFDWHG LQ 6HFWLRQ  FDUERQ VWHHO LQ LQWDFW DQG XQFRQWDPLQDWHG FRQFUHWH LV
WKHUPRG\QDPLFDOO\XQVWDEOHEXWLQWKHSDVVLYHVWDWH3DVVLYLW\LVDFUXFLDOIDFWRUFRQ WKHUPRG\QDPLFDOO\XQVWDEOHEXWLQWKHSDVVLYHVWDWH3DVVLYLW\LVDFUXFLDOIDFWRUFRQ
WUROOLQJERWKWKHFRUURVLRQWHQGHQF\LHWKHWKHUPRG\QDPLFVDQGWKHFRUURVLRQUDWH WUROOLQJERWKWKHFRUURVLRQWHQGHQF\LHWKHWKHUPRG\QDPLFVDQGWKHFRUURVLRQUDWH
LHWKHFRUURVLRQNLQHWLFVLQPDQ\ILHOGVRIPHWDODSSOLFDWLRQ>-RQHV&DOOLVWHU LHWKHFRUURVLRQNLQHWLFVLQPDQ\ILHOGVRIPHWDODSSOLFDWLRQ>-RQHV&DOOLVWHU
&DOOLVWHU%DUGDO@$FFRUGLQJWRPRVWWH[WERRNVFRQWURYHUV\VWLOOH[LVWV &DOOLVWHU%DUGDO@$FFRUGLQJWRPRVWWH[WERRNVFRQWURYHUV\VWLOOH[LVWV
FRQFHUQLQJWKHH[DFWPHFKDQLVPVWKDWOHDGWRWKHH[LVWHQFHRIWKHSKHQRPHQRQRISDV FRQFHUQLQJWKHH[DFWPHFKDQLVPVWKDWOHDGWRWKHH[LVWHQFHRIWKHSKHQRPHQRQRISDV
VLYLW\RQPHWDOV,QDSXEOLFDWLRQDVHDUO\DV)DUDGD\ FI6HFWLRQ DVVXPHG VLYLW\RQPHWDOV,QDSXEOLFDWLRQDVHDUO\DV)DUDGD\ FI6HFWLRQ DVVXPHG
WKDWSDVVLYLW\ZDVFDXVHGE\ DQR[LGHILOPRUDSURFHVVWKDWFDQEHLPDJLQHGDVDG WKDWSDVVLYLW\ZDVFDXVHGE\ DQR[LGHILOPRUDSURFHVVWKDWFDQEHLPDJLQHGDVDG
VRUSWLRQRIR[\JHQRQWKHPHWDOVXUIDFH>.DHVFKH@7KHVHWZRSRVVLELOLWLHVKDYH VRUSWLRQRIR[\JHQRQWKHPHWDOVXUIDFH>.DHVFKH@7KHVHWZRSRVVLELOLWLHVKDYH
EHHQWKHEDVLVIRUWZRFRPSHWLQJWKHRULHVRISDVVLYLW\6WURQJDUJXPHQWVIRUWKHR[LGH EHHQWKHEDVLVIRUWZRFRPSHWLQJWKHRULHVRISDVVLYLW\6WURQJDUJXPHQWVIRUWKHR[LGH
ILOPWKHRU\ZHUHIRXQGE\WKHH[SHULPHQWDOGHPRQVWUDWLRQRIH[LVWLQJR[LGHILOPVLQ ILOPWKHRU\ZHUHIRXQGE\WKHH[SHULPHQWDOGHPRQVWUDWLRQRIH[LVWLQJR[LGHILOPVLQ
FRQQHFWLRQ ZLWK SDVVLYLW\ DQG D UHDVRQDEO\ JRRG FRUUHODWLRQ EHWZHHQ SDVVLYLW\ LQGL FRQQHFWLRQ ZLWK SDVVLYLW\ DQG D UHDVRQDEO\ JRRG FRUUHODWLRQ EHWZHHQ SDVVLYLW\ LQGL
FDWHGE\SRODULVDWLRQFXUYHV FI6HFWLRQ DQGWKHUPRG\QDPLFVWDELOLW\GRPDLQV FDWHGE\SRODULVDWLRQFXUYHV FI6HFWLRQ DQGWKHUPRG\QDPLFVWDELOLW\GRPDLQV
RIPHWDOR[LGHVHJ>3RXUEDL[D3RXUEDL[E@+RZHYHUSDVVLYHOD\HUVDUH RIPHWDOR[LGHVHJ>3RXUEDL[D3RXUEDL[E@+RZHYHUSDVVLYHOD\HUVDUH
YHU\WKLQDQGWKH\FDQEHIRUPHGYLDVWDJHVRIR[\JHQDGVRUSWLRQVRWKDWWKHUHLVQR YHU\WKLQDQGWKH\FDQEHIRUPHGYLDVWDJHVRIR[\JHQDGVRUSWLRQVRWKDWWKHUHLVQR
SUDFWLFDOFRQWURYHUV\EHWZHHQWKHVHWZRWKHRULHV>%DUGDO@)RUWKHVFRSHRIWKLV SUDFWLFDOFRQWURYHUV\EHWZHHQWKHVHWZRWKHRULHV>%DUGDO@)RUWKHVFRSHRIWKLV
WKHVLV LW LV VXIILFLHQW WR DFNQRZOHGJH WKHVH WKHRULHV DQG WR UHJDUG SDVVLYLW\ DV WKH WKHVLV LW LV VXIILFLHQW WR DFNQRZOHGJH WKHVH WKHRULHV DQG WR UHJDUG SDVVLYLW\ DV WKH
SUHVHQFHRIDSURWHFWLYHR[LGHOD\HURQWKHPHWDOVXUIDFHWKDWVLJQLILFDQWO\ORZHUVWKH SUHVHQFHRIDSURWHFWLYHR[LGHOD\HURQWKHPHWDOVXUIDFHWKDWVLJQLILFDQWO\ORZHUVWKH
UDWHRIFRUURVLRQHYHQWKRXJKWKHPHWDOLVWKHUPRG\QDPLFDOO\XQVWDEOH UDWHRIFRUURVLRQHYHQWKRXJKWKHPHWDOLVWKHUPRG\QDPLFDOO\XQVWDEOH
<HWLWLVFUXFLDOWRWDNHRQHFHQWUDOQRWLRQFRQFHUQLQJSDVVLYLW\LQWRDFFRXQW$FFRUG <HWLWLVFUXFLDOWRWDNHRQHFHQWUDOQRWLRQFRQFHUQLQJSDVVLYLW\LQWRDFFRXQW$FFRUG
LQJ WR >%DUGDO @ SDVVLYH OD\HUV ³DUH QRW IRUPHG E\ GHSRVLWLRQ RI FRUURVLRQ LQJ WR >%DUGDO @ SDVVLYH OD\HUV ³DUH QRW IRUPHG E\ GHSRVLWLRQ RI FRUURVLRQ
SURGXFWVIURPWKHOLTXLGDVWKLVXVXDOO\JLYHVPRUHRUOHVVSRURXVVXUIDFHOD\HUVEXW SURGXFWVIURPWKHOLTXLGDVWKLVXVXDOO\JLYHVPRUHRUOHVVSRURXVVXUIDFHOD\HUVEXW
« WKH R[LGH LV GLUHFWO\ IRUPHG LQ FORVH FRQQHFWLRQ ZLWK WKH FU\VWDO VWUXFWXUH RI WKH « WKH R[LGH LV GLUHFWO\ IRUPHG LQ FORVH FRQQHFWLRQ ZLWK WKH FU\VWDO VWUXFWXUH RI WKH
PHWDO´7KLVQRWLRQFRQVWLWXWHVDFHQWUDODVSHFWLQRXUXQGHUVWDQGLQJDQGGHVFULSWLRQ PHWDO´7KLVQRWLRQFRQVWLWXWHVDFHQWUDODVSHFWLQRXUXQGHUVWDQGLQJDQGGHVFULSWLRQ
RI FRUURVLRQ PHFKDQLVPV RI VWHHO LQ FRQFUHWH FI &KDSWHU   ZKLFK GLIIHU WR TXLWH RI FRUURVLRQ PHFKDQLVPV RI VWHHO LQ FRQFUHWH FI &KDSWHU   ZKLFK GLIIHU WR TXLWH
VRPHH[WHQWIURPWKHWUDGLWLRQDOXQGHUVWDQGLQJDQGGHVFULSWLRQRIUHLQIRUFHPHQWFRU VRPHH[WHQWIURPWKHWUDGLWLRQDOXQGHUVWDQGLQJDQGGHVFULSWLRQRIUHLQIRUFHPHQWFRU
URVLRQLQWKHOLWHUDWXUH 1DWXUDOO\WKLVQRWLRQDOVRJRYHUQVRXU JHQHUDOLQWHUSUHWDWLRQ URVLRQLQWKHOLWHUDWXUH 1DWXUDOO\WKLVQRWLRQDOVRJRYHUQVRXU JHQHUDOLQWHUSUHWDWLRQ
DQGDSSOLFDWLRQRIWKHUPRG\QDPLFWRROV FI&KDSWHU DQGKHQFHRXUXQGHUVWDQGLQJ DQGDSSOLFDWLRQRIWKHUPRG\QDPLFWRROV FI&KDSWHU DQGKHQFHRXUXQGHUVWDQGLQJ
DQGGHVFULSWLRQRIDYDLODEOHFRXQWHUPHDVXUHV FI&KDSWHU DQGGHVLJQVWUDWHJLHVIRU DQGGHVFULSWLRQRIDYDLODEOHFRXQWHUPHDVXUHV FI&KDSWHU DQGGHVLJQVWUDWHJLHVIRU
QHZFRXQWHUPHDVXUHV FI&KDSWHU  QHZFRXQWHUPHDVXUHV FI&KDSWHU 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

'XH WR WKH DERYH DQG WKHLU OLPLWHG WKLFNQHVV VRPH SDVVLYH OD\HUV DOORZ WUDQVIHU RI 'XH WR WKH DERYH DQG WKHLU OLPLWHG WKLFNQHVV VRPH SDVVLYH OD\HUV DOORZ WUDQVIHU RI
HOHFWURQVVRWKDWFHUWDLQHOHFWURFKHPLFDOUHDFWLRQVFDQRFFXU RQWKHH[WHUQDOIDFHRI HOHFWURQVVRWKDWFHUWDLQHOHFWURFKHPLFDOUHDFWLRQVFDQRFFXU RQWKHH[WHUQDOIDFHRI
WKHR[LGH,QRUGHUWRXQGHUVWDQGWKHSUDFWLFDOPHDQLQJRIWKLVDVSHFWLWLVHVSHFLDOO\ WKHR[LGH,QRUGHUWRXQGHUVWDQGWKHSUDFWLFDOPHDQLQJRIWKLVDVSHFWLWLVHVSHFLDOO\
ZLWKUHJDUGWRWKHHYDOXDWLRQRIDYDLODEOHDQGWKHGHVLJQRIQHZFRXQWHUPHDVXUHVLP ZLWKUHJDUGWRWKHHYDOXDWLRQRIDYDLODEOHDQGWKHGHVLJQRIQHZFRXQWHUPHDVXUHVLP
SRUWDQWWRGLVWLQJXLVKEHWZHHQWKHUHODWHGFKDUDFWHULVWLFVRISDVVLYHOD\HUVRIGLIIHUHQW SRUWDQWWRGLVWLQJXLVKEHWZHHQWKHUHODWHGFKDUDFWHULVWLFVRISDVVLYHOD\HUVRIGLIIHUHQW
PHWDOV &RQFHUQLQJ WKHVH FKDUDFWHULVWLFV LQ SULQFLSOH WKUHH PDMRU JURXSV RI VXUIDFH PHWDOV &RQFHUQLQJ WKHVH FKDUDFWHULVWLFV LQ SULQFLSOH WKUHH PDMRU JURXSV RI VXUIDFH
OD\HUVRQPHWDOZLWKSDVVLYDWLQJSURSHUWLHVFDQEHGLVWLQJXLVKHG>%DUGDO@ OD\HUVRQPHWDOZLWKSDVVLYDWLQJSURSHUWLHVFDQEHGLVWLQJXLVKHG>%DUGDO@
‡ 7KHILUVWJURXSRISDVVLYHOD\HUVLPSHGHDQRGLFUHDFWLRQVHIIHFWLYHO\EXWQRWWKH ‡ 7KHILUVWJURXSRISDVVLYHOD\HUVLPSHGHDQRGLFUHDFWLRQVHIIHFWLYHO\EXWQRWWKH
FDWKRGLFUHDFWLRQ7KLVPHDQVWKDWWKHSDVVLYHOD\HULVHOHFWURQFRQGXFWLQJEXWQRW FDWKRGLFUHDFWLRQ7KLVPHDQVWKDWWKHSDVVLYHOD\HULVHOHFWURQFRQGXFWLQJEXWQRW
LRQFRQGXFWLQJ FI6HFWLRQ ([DPSOHVIRUWKLVJURXSRISDVVLYHOD\HUVDUH LRQFRQGXFWLQJ FI6HFWLRQ ([DPSOHVIRUWKLVJURXSRISDVVLYHOD\HUVDUH
LURQQLFNHOFKURPHDQGWKHLUDOOR\VHJVWDLQOHVVVWHHO FI6HFWLRQ  LURQQLFNHOFKURPHDQGWKHLUDOOR\VHJVWDLQOHVVVWHHO FI6HFWLRQ 
‡ 7KHVHFRQGJURXSRISDVVLYHOD\HUVLPSHGHERWKWKHDQRGLFDQGWKHFDWKRGLFUHDF ‡ 7KHVHFRQGJURXSRISDVVLYHOD\HUVLPSHGHERWKWKHDQRGLFDQGWKHFDWKRGLFUHDF
WLRQWRDODUJHH[WHQWLHWKHSDVVLYHOD\HULPSHGHVFRQGXFWLRQRIERWKHOHFWURQV WLRQWRDODUJHH[WHQWLHWKHSDVVLYHOD\HULPSHGHVFRQGXFWLRQRIERWKHOHFWURQV
DQG LRQV $ W\SLFDO H[DPSOH IRU IRUPDWLRQ RI VXFK SDVVLYH OD\HUV LV DOXPLQLXP DQG LRQV $ W\SLFDO H[DPSOH IRU IRUPDWLRQ RI VXFK SDVVLYH OD\HUV LV DOXPLQLXP
ZKLFKFRQWUDU\WRLURQQLFNHODQGFKURPHIRUPVDSDVVLYHOD\HUZLWKKLJKUHVLV ZKLFKFRQWUDU\WRLURQQLFNHODQGFKURPHIRUPVDSDVVLYHOD\HUZLWKKLJKUHVLV
WDQFHDJDLQVWHOHFWURQWUDQVIHU )XUWKHUPRUHWKHSDVVLYHOD\HURI]LQFLVJHQHUDOO\ WDQFHDJDLQVWHOHFWURQWUDQVIHU )XUWKHUPRUHWKHSDVVLYHOD\HURI]LQFLVJHQHUDOO\
FRQVLGHUHG WR ODUJHO\ SUHYHQW ERWK DQRGLF DQG FDWKRGLF UHDFWLRQV >=KDQJ  FRQVLGHUHG WR ODUJHO\ SUHYHQW ERWK DQRGLF DQG FDWKRGLF UHDFWLRQV >=KDQJ 
5REHUJH@ 5REHUJH@
‡ 7KHWKLUGJURXSFRPSULVHVSRURXVVXUIDFHOD\HUVHJGHSRVLWHGUXVWDQGVDOWV,Q ‡ 7KHWKLUGJURXSFRPSULVHVSRURXVVXUIDFHOD\HUVHJGHSRVLWHGUXVWDQGVDOWV,Q
SULQFLSOHWKHVHDUHQRSDVVLYHOD\HUV+RZHYHUVXFKOD\HUVPD\UHGXFHERWKDQ SULQFLSOHWKHVHDUHQRSDVVLYHOD\HUV+RZHYHUVXFKOD\HUVPD\UHGXFHERWKDQ
RGLFDQGFDWKRGLFUHDFWLRQVEXWQRWVXIILFLHQWO\WRSURYLGHHIILFLHQWSDVVLYLW\7KH RGLFDQGFDWKRGLFUHDFWLRQVEXWQRWVXIILFLHQWO\WRSURYLGHHIILFLHQWSDVVLYLW\7KH
FDWKRGLFUHDFWLRQPD\WDNHSODFHRQWKHPHWDOVXUIDFHLQWKHERWWRPRISRUHVRIWKH FDWKRGLFUHDFWLRQPD\WDNHSODFHRQWKHPHWDOVXUIDFHLQWKHERWWRPRISRUHVRIWKH
SRURXVOD\HUDQGLWLVKLQGHUHGWRDFHUWDLQH[WHQWE\WKHUHVLVWDQFHRIWKHGHSRVLW SRURXVOD\HUDQGLWLVKLQGHUHGWRDFHUWDLQH[WHQWE\WKHUHVLVWDQFHRIWKHGHSRVLW
DJDLQVWR[\JHQGLIIXVLRQ$WWKHVDPHWLPHWKH SRUHVDOORZWKHDQRGLFUHDFWLRQ DJDLQVWR[\JHQGLIIXVLRQ$WWKHVDPHWLPHWKH SRUHVDOORZWKHDQRGLFUHDFWLRQ
EXWLWLVDOVRODUJHO\KLQGHUHGE\WKHGHSRVLW EXWLWLVDOVRODUJHO\KLQGHUHGE\WKHGHSRVLW
6RWREHHIIHFWLYH DSDVVLYHOD\HUPXVWSURYLGHORZLRQLFFRQGXFWLYLW\DQGORZVROX 6RWREHHIIHFWLYH DSDVVLYHOD\HUPXVWSURYLGHORZLRQLFFRQGXFWLYLW\DQGORZVROX
ELOLW\,QDGGLWLRQLWPXVWKDYHVXIILFLHQWWRXJKQHVVDQGDGKHVLRQWRWKHPHWDOWRDYRLG ELOLW\,QDGGLWLRQLWPXVWKDYHVXIILFLHQWWRXJKQHVVDQGDGKHVLRQWRWKHPHWDOWRDYRLG
FUDFNLQJZHDUDQGRUGLVERQGLQJ0RUHRYHUUHVLVWDQFHWREUHDNGRZQ LHWKHGHWH FUDFNLQJZHDUDQGRUGLVERQGLQJ0RUHRYHUUHVLVWDQFHWREUHDNGRZQ LHWKHGHWH
ULRUDWLRQRIWKHSDVVLYHOD\HU GHSHQGVRQLWVUHVLVWDQFHWRGHSDVVLYDWLQJVSHFLHV 'H ULRUDWLRQRIWKHSDVVLYHOD\HU GHSHQGVRQLWVUHVLVWDQFHWRGHSDVVLYDWLQJVSHFLHV 'H
SDVVLYDWLQJVSHFLHVQRUPDOO\OHDGWRDORFDOLVHGEUHDNGRZQRIWKHSDVVLYHOD\HU/R SDVVLYDWLQJVSHFLHVQRUPDOO\OHDGWRDORFDOLVHGEUHDNGRZQRIWKHSDVVLYHOD\HU/R
FDOLVHGEUHDNGRZQUHVXOWVLQVHYHUDOIRUPVRIORFDOLVHGFRUURVLRQSKHQRPHQDIRUFDU FDOLVHGEUHDNGRZQUHVXOWVLQVHYHUDOIRUPVRIORFDOLVHGFRUURVLRQSKHQRPHQDIRUFDU
ERQDQGVWDLQOHVVVWHHOVHJSLWWLQJFUHYLFHDQGLQWHUJUDQXODUFRUURVLRQ FI6HFWLRQ ERQDQGVWDLQOHVVVWHHOVHJSLWWLQJFUHYLFHDQGLQWHUJUDQXODUFRUURVLRQ FI6HFWLRQ
 8QIRUWXQDWHO\RQHRIWKHPDMRUVSHFLHVFDXVLQJWKHEUHDNGRZQRISDVVLYLW\IRU  8QIRUWXQDWHO\RQHRIWKHPDMRUVSHFLHVFDXVLQJWKHEUHDNGRZQRISDVVLYLW\IRU
PDQ\PHWDOVLVFKORULGHZKLFKLVDEXQGDQWO\DYDLODEOHLQQDWXUH0HFKDQLVPVSRVWX PDQ\PHWDOVLVFKORULGHZKLFKLVDEXQGDQWO\DYDLODEOHLQQDWXUH0HFKDQLVPVSRVWX
ODWHGIRUWKHEUHDNGRZQRIWKHSDVVLYHOD\HUE\FKORULGHLRQVDUHEULHIO\GHVFULEHGLQ ODWHGIRUWKHEUHDNGRZQRIWKHSDVVLYHOD\HUE\FKORULGHLRQVDUHEULHIO\GHVFULEHGLQ
6HFWLRQ 6HFWLRQ

 

+RZHYHULQSUDFWLFHQDWXUDOR[LGHVRQDOXPLQLXPJHQHUDOO\KDYHDODUJHQXPEHURIGHIHFWVWKDWDO +RZHYHULQSUDFWLFHQDWXUDOR[LGHVRQDOXPLQLXPJHQHUDOO\KDYHDODUJHQXPEHURIGHIHFWVWKDWDO
ORZVRPHHOHFWURQFRQGXFWDQFHDQGKHQFHFDWKRGLFDFWLYLW\ ORZVRPHHOHFWURQFRQGXFWDQFHDQGKHQFHFDWKRGLFDFWLYLW\

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

$ UHSDVVLYDWLRQ SURFHVV FRPSHWHV ZLWK WKH EUHDNGRZQ SURFHVV RI WKH SDVVLYH OD\HU $ UHSDVVLYDWLRQ SURFHVV FRPSHWHV ZLWK WKH EUHDNGRZQ SURFHVV RI WKH SDVVLYH OD\HU
7KXVDQHIIHFWLYHPHWDOIRUUHVLVWLQJORFDOLVHGFRUURVLRQQRWRQO\IRUPVDQHIIHFWLYH 7KXVDQHIIHFWLYHPHWDOIRUUHVLVWLQJORFDOLVHGFRUURVLRQQRWRQO\IRUPVDQHIIHFWLYH
SDVVLYHOD\HUEXWLVDOVRFDSDEOHRIUHSDVVLYDWLQJDWDUDWHVXIILFLHQWO\KLJKWKDWH[SR SDVVLYHOD\HUEXWLVDOVRFDSDEOHRIUHSDVVLYDWLQJDWDUDWHVXIILFLHQWO\KLJKWKDWH[SR
VXUH WR D FRUURVLYH HQYLURQPHQW LV PLQLPDO RQFH EUHDNGRZQ KDV RFFXUUHG >-RQHV VXUH WR D FRUURVLYH HQYLURQPHQW LV PLQLPDO RQFH EUHDNGRZQ KDV RFFXUUHG >-RQHV
&DOOLVWHU &DOOLVWHU.UXJHU%DUGDO@ &DOOLVWHU &DOOLVWHU.UXJHU%DUGDO@
,IWKHWKHUPRG\QDPLFUHTXLUHPHQWVIRUSDVVLYDWLRQDUHIXOILOOHGDQGWKHSDVVLYHOD\HU ,IWKHWKHUPRG\QDPLFUHTXLUHPHQWVIRUSDVVLYDWLRQDUHIXOILOOHGDQGWKHSDVVLYHOD\HU
PHHWVWKHDERYHUHTXLUHPHQWVDQRGLFGLVVROXWLRQLVODUJHO\LPSHGHG)RULQVWDQFHIRU PHHWVWKHDERYHUHTXLUHPHQWVDQRGLFGLVVROXWLRQLVODUJHO\LPSHGHG)RULQVWDQFHIRU
VWHHOLQFRQFUHWHWKHFRUURVLRQUDWHXQGHUWKLVFRQGLWLRQKDVEHHQHVWLPDWHGWRDERXW VWHHOLQFRQFUHWHWKHFRUURVLRQUDWHXQGHUWKLVFRQGLWLRQKDVEHHQHVWLPDWHGWRDERXW
—P\ >$UXS @ 7KLV LV SUDFWLFDOO\ QHJOLJLEOH DOWKRXJK VWHHO RU PRUH SUH —P\ >$UXS @ 7KLV LV SUDFWLFDOO\ QHJOLJLEOH DOWKRXJK VWHHO RU PRUH SUH
FLVHO\LURQ LVQRWWKHUPRG\QDPLFDOO\LPPXQH FI6HFWLRQ 7KHVORZGLVVROXWLRQ FLVHO\LURQ LVQRWWKHUPRG\QDPLFDOO\LPPXQH FI6HFWLRQ 7KHVORZGLVVROXWLRQ
FDQ RQO\ EH DVVHVVHG HOHFWURFKHPLFDOO\ HJ E\ PHDVXUHPHQWV WR GHWHUPLQH WKH SDV FDQ RQO\ EH DVVHVVHG HOHFWURFKHPLFDOO\ HJ E\ PHDVXUHPHQWV WR GHWHUPLQH WKH SDV
VLYHFXUUHQWGHQVLW\µLS¶ FI6HFWLRQ 7KHFXUUHQWGHQVLW\LVDQLPSRUWDQWNL VLYHFXUUHQWGHQVLW\µLS¶ FI6HFWLRQ 7KHFXUUHQWGHQVLW\LVDQLPSRUWDQWNL
QHWLF SDUDPHWHU WKDW LV GHDOW ZLWK WKURXJKRXW &KDSWHU  ZKLOH WKH WKHRUHWLFDO EDFN QHWLF SDUDPHWHU WKDW LV GHDOW ZLWK WKURXJKRXW &KDSWHU  ZKLOH WKH WKHRUHWLFDO EDFN
JURXQGLVPDLQO\GHVFULEHGLQ6HFWLRQ JURXQGLVPDLQO\GHVFULEHGLQ6HFWLRQ
:LWK UHJDUG WR SDVVLYLW\ DQG NLQHWLFV LW VKRXOG EH HPSKDVLVHG WKDW WKH DSSURSULDWH :LWK UHJDUG WR SDVVLYLW\ DQG NLQHWLFV LW VKRXOG EH HPSKDVLVHG WKDW WKH DSSURSULDWH
WKHUPRG\QDPLFFRQGLWLRQVGRQRWQHFHVVDULO\JXDUDQWHHWKHRFFXUUHQFHRISDVVLYDWLRQ WKHUPRG\QDPLFFRQGLWLRQVGRQRWQHFHVVDULO\JXDUDQWHHWKHRFFXUUHQFHRISDVVLYDWLRQ
7KHDFWXDORFFXUUHQFHRISDVVLYDWLRQGHSHQGVDOVRRQNLQHWLFFRQGLWLRQV:KLOHWKHU 7KHDFWXDORFFXUUHQFHRISDVVLYDWLRQGHSHQGVDOVRRQNLQHWLFFRQGLWLRQV:KLOHWKHU
PRG\QDPLFFRQGLWLRQVGHWHUPLQHZKHWKHUIRUPDWLRQRIDSDVVLYDWLRQOD\HULVSRVVLEOH PRG\QDPLFFRQGLWLRQVGHWHUPLQHZKHWKHUIRUPDWLRQRIDSDVVLYDWLRQOD\HULVSRVVLEOH
NLQHWLFFRQGLWLRQVJRYHUQWKHFKHPLVWU\QHDUWKHHOHFWURGHVXUIDFHDQGKHQFHWKHFKDU NLQHWLFFRQGLWLRQVJRYHUQWKHFKHPLVWU\QHDUWKHHOHFWURGHVXUIDFHDQGKHQFHWKHFKDU
DFWHULVWLFVRIWKHIRUPHGSDVVLYHOD\HUZKLFKLVGXHWRWKHODUJHO\KLQGHUHGLQJUHVVRI DFWHULVWLFVRIWKHIRUPHGSDVVLYHOD\HUZKLFKLVGXHWRWKHODUJHO\KLQGHUHGLQJUHVVRI
VXEVWDQFHVDQGLRQPRELOLW\LQWKHFRQFUHWHEXONDSDUWLFXODUO\FHQWUDODVSHFWLQUHLQ VXEVWDQFHVDQGLRQPRELOLW\LQWKHFRQFUHWHEXONDSDUWLFXODUO\FHQWUDODVSHFWLQUHLQ
IRUFHPHQWFRUURVLRQ,QJUHVVLQWRDQGLRQPRELOLW\LQFRQFUHWHDUHGHDOWZLWKLQ6HF IRUFHPHQWFRUURVLRQ,QJUHVVLQWRDQGLRQPRELOLW\LQFRQFUHWHDUHGHDOWZLWKLQ6HF
WLRQDQGWKHFRQVHTXHQFHVIRUUHLQIRUFHPHQWFRUURVLRQDUHGLVFXVVHGWKURXJKRXW WLRQDQGWKHFRQVHTXHQFHVIRUUHLQIRUFHPHQWFRUURVLRQDUHGLVFXVVHGWKURXJKRXW
&KDSWHU &KDSWHU

 3RXUEDL['LDJUDP  3RXUEDL['LDJUDP


0RVWPHWDOVH[SHULHQFHDFKDQJHRIWKHUPRG\QDPLFVWDELOLW\ZLWKDFKDQJHRIWKHS+ 0RVWPHWDOVH[SHULHQFHDFKDQJHRIWKHUPRG\QDPLFVWDELOLW\ZLWKDFKDQJHRIWKHS+
RIWKHHQYLURQPHQW+RZHYHUQRWRQO\WKHS+RIWKHHQYLURQPHQWEXWDOVRLWVR[LGLV RIWKHHQYLURQPHQW+RZHYHUQRWRQO\WKHS+RIWKHHQYLURQPHQWEXWDOVRLWVR[LGLV
LQJ SRZHU LH WKH HOHFWURFKHPLFDO SRWHQWLDO JRYHUQV WKH IRUPDWLRQ RI GLIIHUHQW LQJ SRZHU LH WKH HOHFWURFKHPLFDO SRWHQWLDO JRYHUQV WKH IRUPDWLRQ RI GLIIHUHQW
FKHPLFDOVSHFLHVRIDPHWDOLHWKHSXUHPHWDOVROXEOHLRQVRUR[LGHV7KH3RXUEDL[ FKHPLFDOVSHFLHVRIDPHWDOLHWKHSXUHPHWDOVROXEOHLRQVRUR[LGHV7KH3RXUEDL[
GLDJUDP LVDSUHGRPLQDQFHGLDJUDPWKDWFRPELQHVWKHVHWZRIDFWRUVE\PDSSLQJRXW GLDJUDP LVDSUHGRPLQDQFHGLDJUDPWKDWFRPELQHVWKHVHWZRIDFWRUVE\PDSSLQJRXW
WKHYDULRXVSRVVLEOHVSHFLHVRIDQDTXHRXVHOHFWURFKHPLFDOV\VWHPGHSHQGLQJRQWKH WKHYDULRXVSRVVLEOHVSHFLHVRIDQDTXHRXVHOHFWURFKHPLFDOV\VWHPGHSHQGLQJRQWKH
S+DQGWKHHOHFWURGHSRWHQWLDOµ(¶7KHS+DQGµ(¶DUHUHSUHVHQWHGRQWKH;D[LVDQG S+DQGWKHHOHFWURGHSRWHQWLDOµ(¶7KHS+DQGµ(¶DUHUHSUHVHQWHGRQWKH;D[LVDQG
<D[LVUHVSHFWLYHO\7KHGRPDLQVRIIDYRXUHGWKHUPRG\QDPLFVWDELOLW\RIWKHGLIIHU <D[LVUHVSHFWLYHO\7KHGRPDLQVRIIDYRXUHGWKHUPRG\QDPLFVWDELOLW\RIWKHGLIIHU
HQWVSHFLHV KHQFHIRUWKVWDELOLW\GRPDLQV DUHERXQGHGE\OLQHVWKDWUHSUHVHQWHTXLOLE HQWVSHFLHV KHQFHIRUWKVWDELOLW\GRPDLQV DUHERXQGHGE\OLQHVWKDWUHSUHVHQWHTXLOLE
ULXP FRQGLWLRQV EHWZHHQ WKH WZR DGMDFHQW WKHUPRG\QDPLFDOO\ IDYRXUHG VSHFLHV ULXP FRQGLWLRQV EHWZHHQ WKH WZR DGMDFHQW WKHUPRG\QDPLFDOO\ IDYRXUHG VSHFLHV
KHQFHIRUWKHTXLOLEULXPOLQHV 7KHVHOLQHVUHSUHVHQWWKHYDULRXVSRVVLEOHUHDFWLRQVRI KHQFHIRUWKHTXLOLEULXPOLQHV 7KHVHOLQHVUHSUHVHQWWKHYDULRXVSRVVLEOHUHDFWLRQVRI
WKHDTXHRXVHOHFWURFKHPLFDOV\VWHPDQGDUHGHULYHGIURPWKHH[SUHVVLRQRIµǻ*¶IRU WKHDTXHRXVHOHFWURFKHPLFDOV\VWHPDQGDUHGHULYHGIURPWKHH[SUHVVLRQRIµǻ*¶IRU
 

1DPHGDIWHU0DUFHO3RXUEDL[5XVVLD%HOJLXP>5REHUJH@,QWKHOLWHUDWXUHDOVR 1DPHGDIWHU0DUFHO3RXUEDL[5XVVLD%HOJLXP>5REHUJH@,QWKHOLWHUDWXUHDOVR
UHIHUUHGWRDVHTXLOLEULXPGLDJUDPSRWHQWLDOS+GLDJUDP(S+GLDJUDPRU(KS+GLDJUDP UHIHUUHGWRDVHTXLOLEULXPGLDJUDPSRWHQWLDOS+GLDJUDP(S+GLDJUDPRU(KS+GLDJUDP

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

QRQVWDQGDUG VWDWHV FI 6HFWLRQ   DV ZHOO DV WKH 1HUQVW HTXDWLRQ FI 6HFWLRQ QRQVWDQGDUG VWDWHV FI 6HFWLRQ   DV ZHOO DV WKH 1HUQVW HTXDWLRQ FI 6HFWLRQ
 +HQFHWKH3RXUEDL[GLDJUDPFDQEHXQGHUVWRRGDVDJUDSKLFDOUHSUHVHQWDWLRQ  +HQFHWKH3RXUEDL[GLDJUDPFDQEHXQGHUVWRRGDVDJUDSKLFDOUHSUHVHQWDWLRQ
RIWKHVHHTXDWLRQV RIWKHVHHTXDWLRQV
7KHHTXLOLEULXPOLQHVDUHREWDLQHGE\LQVHUWLQJµ¨*¶RUµ(¶RIWKHUHDFWLRQGHVFULE 7KHHTXLOLEULXPOLQHVDUHREWDLQHGE\LQVHUWLQJµ¨*¶RUµ(¶RIWKHUHDFWLRQGHVFULE
LQJWKHHTXLOLEULXPEHWZHHQWZRDGMDFHQWVWDELOLW\GRPDLQVDQGWKHDVVRFLDWHGDFWLYL LQJWKHHTXLOLEULXPEHWZHHQWZRDGMDFHQWVWDELOLW\GRPDLQVDQGWKHDVVRFLDWHGDFWLYL
WLHV LQ WKH H[SUHVVLRQ RI µǻ*¶ IRU QRQVWDQGDUG VWDWHV >@ RU WKH 1HUQVW HTXDWLRQ WLHV LQ WKH H[SUHVVLRQ RI µǻ*¶ IRU QRQVWDQGDUG VWDWHV >@ RU WKH 1HUQVW HTXDWLRQ
>@UHVSHFWLYHO\+HQFHWKHS+GHSHQGHQF\RUWKHHTXLOLEULXPS+RIDQHTXLOLE >@UHVSHFWLYHO\+HQFHWKHS+GHSHQGHQF\RUWKHHTXLOLEULXPS+RIDQHTXLOLE
ULXPOLQHLVGHWHUPLQHGIURPWKHSDUWLFLSDWLRQRI+RU2+íLQWKHUHDFWLRQ7KLVOHDGV ULXPOLQHLVGHWHUPLQHGIURPWKHSDUWLFLSDWLRQRI+RU2+íLQWKHUHDFWLRQ7KLVOHDGV
WRWKHIROORZLQJW\SHVRIHTXLOLEULXPOLQHVLQWKH3RXUEDL[GLDJUDP WRWKHIROORZLQJW\SHVRIHTXLOLEULXPOLQHVLQWKH3RXUEDL[GLDJUDP
‡ (TXLOLEULXP OLQHV RI KDOIFHOO UHDFWLRQV ZLWK SDUWLFLSDWLRQ RI + RU 2+í ZKLFK ‡ (TXLOLEULXP OLQHV RI KDOIFHOO UHDFWLRQV ZLWK SDUWLFLSDWLRQ RI + RU 2+í ZKLFK
FRUUHVSRQGWRLQFOLQHGOLQHVLQWKH3RXUEDL[GLDJUDP HTXLOLEULXPOLQHW\SH,  FRUUHVSRQGWRLQFOLQHGOLQHVLQWKH3RXUEDL[GLDJUDP HTXLOLEULXPOLQHW\SH, 
‡ (TXLOLEULXPOLQHVRIKDOIFHOOUHDFWLRQVZLWKRXWSDUWLFLSDWLRQRI+RU2+íZKLFK ‡ (TXLOLEULXPOLQHVRIKDOIFHOOUHDFWLRQVZLWKRXWSDUWLFLSDWLRQRI+RU2+íZKLFK
FRUUHVSRQGWRKRUL]RQWDOOLQHVLQWKH3RXUEDL[GLDJUDP HTXLOLEULXPOLQHW\SH,,  FRUUHVSRQGWRKRUL]RQWDOOLQHVLQWKH3RXUEDL[GLDJUDP HTXLOLEULXPOLQHW\SH,, 
‡ (TXLOLEULXPOLQHVRI DFLGEDVHUHDFWLRQVZLWKSDUWLFLSDWLRQRI+RU2+íZKLFK ‡ (TXLOLEULXPOLQHVRI DFLGEDVHUHDFWLRQVZLWKSDUWLFLSDWLRQRI+RU2+íZKLFK
FRUUHVSRQGWRYHUWLFDOOLQHVLQWKH3RXUEDL[GLDJUDP HTXLOLEULXPOLQHW\SH,,,  FRUUHVSRQGWRYHUWLFDOOLQHVLQWKH3RXUEDL[GLDJUDP HTXLOLEULXPOLQHW\SH,,, 
3RXUEDL[ GLDJUDPV FDQ EH FRQVWUXFWHG IRU DOO YDULDWLRQV LQ WHPSHUDWXUH LQ JDV SUHV 3RXUEDL[ GLDJUDPV FDQ EH FRQVWUXFWHG IRU DOO YDULDWLRQV LQ WHPSHUDWXUH LQ JDV SUHV
VXUHDQGLQWKHDFWLYLW\RIWKHVSHFLHV FIHTXDWLRQV>@DQG>@ +RZHYHUDV VXUHDQGLQWKHDFWLYLW\RIWKHVSHFLHV FIHTXDWLRQV>@DQG>@ +RZHYHUDV
PHQWLRQHGPDLQO\WKHYDULDWLRQVLQWKHDFWLYLW\RIWKHVROXEOHLRQVDUHRILPSRUWDQFH PHQWLRQHGPDLQO\WKHYDULDWLRQVLQWKHDFWLYLW\RIWKHVROXEOHLRQVDUHRILPSRUWDQFH
LQWKLVWKHVLV LQWKLVWKHVLV
)RUH[HPSOLILFDWLRQSXUSRVHVD3RXUEDL[GLDJUDPIRUWKH)H+2V\VWHP EDVHGRQD )RUH[HPSOLILFDWLRQSXUSRVHVD3RXUEDL[GLDJUDPIRUWKH)H+2V\VWHP EDVHGRQD
SUHVHOHFWLRQRIVSHFLHVDFFRUGLQJWR7DEOHDQGDQLURQLRQDFWLYLW\RIíPRO/LV SUHVHOHFWLRQRIVSHFLHVDFFRUGLQJWR7DEOHDQGDQLURQLRQDFWLYLW\RIíPRO/LV
VKRZQLQ)LJXUH>$@ VKRZQLQ)LJXUH>$@
7DEOH 6SHFLHV SUHVHOHFWHG IRU WKH 3RXUEDL[ GLDJUDP RI WKH JHQHUDO )H+2 7DEOH 6SHFLHV SUHVHOHFWHG IRU WKH 3RXUEDL[ GLDJUDP RI WKH JHQHUDO )H+2
V\VWHP‚ V\VWHP‚

6ROLG )H )H2 )H2 6ROLG )H )H2 )H2


  í  
6ROXEOH )H  )H  +)H2  6ROXEOH )H  )H  +)H2í
 
7KHVWDELOLW\GRPDLQVFRUUHVSRQGLQJWRWKHSUHVHOHFWLRQLQ7DEOHDUHJLYHQLQ)LJ 7KHVWDELOLW\GRPDLQVFRUUHVSRQGLQJWRWKHSUHVHOHFWLRQLQ7DEOHDUHJLYHQLQ)LJ
XUH>$@ZKLOH)LJXUH>%@LOOXVWUDWHVWKHFRUUHVSRQGLQJWKHUPRG\QDPLFVWDWHV XUH>$@ZKLOH)LJXUH>%@LOOXVWUDWHVWKHFRUUHVSRQGLQJWKHUPRG\QDPLFVWDWHV
DQG SURYLGHV WKH ODEHOV IRU WKH H[HPSOLILFDWLRQV FRQFHUQLQJ WKH FRQVWUXFWLRQ RI WKH DQG SURYLGHV WKH ODEHOV IRU WKH H[HPSOLILFDWLRQV FRQFHUQLQJ WKH FRQVWUXFWLRQ RI WKH
HTXLOLEULXPOLQHV HTXLOLEULXPOLQHV

 

7KLVW\SHRI3RXUEDL[GLDJUDPLVUHIHUUHGWRDVVLQJOHHOHPHQW3RXUEDL[GLDJUDPµ6(3'¶ZKHQLWLV 7KLVW\SHRI3RXUEDL[GLDJUDPLVUHIHUUHGWRDVVLQJOHHOHPHQW3RXUEDL[GLDJUDPµ6(3'¶ZKHQLWLV
UHOHYDQWWRGLIIHUHQWLDWHEHWZHHQGLIIHUHQWW\SHVRIGLDJUDPVZKLFKZLOOEHIXUWKHUHODERUDWHGLQ6HF UHOHYDQWWRGLIIHUHQWLDWHEHWZHHQGLIIHUHQWW\SHVRIGLDJUDPVZKLFKZLOOEHIXUWKHUHODERUDWHGLQ6HF
WLRQ FI&KDSWHUµ7D'¶  WLRQ FI&KDSWHUµ7D'¶ 
‚ ‚
7KHSUHVHOHFWHGVSHFLHVDUHOLVWHGLQDOSKDEHWLFDORUGHUIRUVROLGDQGVROXEOHVSHFLHV7KLVV\VWHPLV 7KHSUHVHOHFWHGVSHFLHVDUHOLVWHGLQDOSKDEHWLFDORUGHUIRUVROLGDQGVROXEOHVSHFLHV7KLVV\VWHPLV
NHSWXSWKURXJKRXWWKLVWKHVLVIRUWDEOHVLOOXVWUDWLQJWKHSUHVHOHFWLRQIRUDOOW\SHVRI3RXUEDL[GLD NHSWXSWKURXJKRXWWKLVWKHVLVIRUWDEOHVLOOXVWUDWLQJWKHSUHVHOHFWLRQIRUDOOW\SHVRI3RXUEDL[GLD
JUDPV FI6HFWLRQ  JUDPV FI6HFWLRQ 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

 
í í
)LJXUH )H+23RXUEDL[GLDJUDPEDVHGRQ7DEOHZLWK)HLD  PRO/ )LJXUH )H+23RXUEDL[GLDJUDPEDVHGRQ7DEOHZLWK)HLD  PRO/
>$@ 'RPLQDQWVSHFLHVLQWKHLUDVVRFLDWHGVWDELOLW\GRPDLQV >%@ ,GHQ >$@ 'RPLQDQWVSHFLHVLQWKHLUDVVRFLDWHGVWDELOLW\GRPDLQV >%@ ,GHQ
WLILFDWLRQRILPPXQHSDVVLYHDQGFRUURVLYHGRPDLQVDQGODEHOOLQJIRU WLILFDWLRQRILPPXQHSDVVLYHDQGFRUURVLYHGRPDLQVDQGODEHOOLQJIRU
GHVFULSWLRQRIHTXLOLEULXPOLQHV GHVFULSWLRQRIHTXLOLEULXPOLQHV
%HVLGHV WKH FKRLFH RI DFWLYLWLHV RI VROXEOH VSHFLHV WKH SUHVHOHFWLRQ RI VSHFLHV WR EH %HVLGHV WKH FKRLFH RI DFWLYLWLHV RI VROXEOH VSHFLHV WKH SUHVHOHFWLRQ RI VSHFLHV WR EH
WDNHQLQWRFRQVLGHUDWLRQLQWKHHVWDEOLVKPHQWRIWKHGLDJUDPLVWKHDEVROXWHFHQWUDODV WDNHQLQWRFRQVLGHUDWLRQLQWKHHVWDEOLVKPHQWRIWKHGLDJUDPLVWKHDEVROXWHFHQWUDODV
SHFWLQWKH3RXUEDL[GLDJUDP7KHGLDJUDPZLOORQO\UHSUHVHQWDQHOHFWURFKHPLFDOV\V SHFWLQWKH3RXUEDL[GLDJUDP7KHGLDJUDPZLOORQO\UHSUHVHQWDQHOHFWURFKHPLFDOV\V
WHPLIDOOVSHFLHVWKDWKDYHDWHQGHQF\WREHIRUPHGDUHFRQVLGHUHGDQGVSHFLHVWKDW WHPLIDOOVSHFLHVWKDWKDYHDWHQGHQF\WREHIRUPHGDUHFRQVLGHUHGDQGVSHFLHVWKDW
ZLOO QRW EH IRUPHG DUH GHVHOHFWHG 7KLV FUXFLDO LQIRUPDWLRQ LV QRW LPSOHPHQWHG LQ ZLOO QRW EH IRUPHG DUH GHVHOHFWHG 7KLV FUXFLDO LQIRUPDWLRQ LV QRW LPSOHPHQWHG LQ
µ+6&¶ RUWRRXUNQRZOHGJHLQDQ\RWKHUWKHUPRG\QDPLFVRIWZDUH DQGVROHO\EDVHG µ+6&¶ RUWRRXUNQRZOHGJHLQDQ\RWKHUWKHUPRG\QDPLFVRIWZDUH DQGVROHO\EDVHG
RQXVHULQSXW RQXVHULQSXW
7KLV6HFWLRQRQO\GHDOVZLWKWKHDQDO\WLFDOEDFNJURXQGRI3RXUEDL[GLDJUDPV,RQDF 7KLV6HFWLRQRQO\GHDOVZLWKWKHDQDO\WLFDOEDFNJURXQGRI3RXUEDL[GLDJUDPV,RQDF
WLYLWLHVDQGWKHSUHVHOHFWLRQRIVSHFLHVDVZHOODVRWKHUDVSHFWV LQSDUWLFXODUUHODWLQJ WLYLWLHVDQGWKHSUHVHOHFWLRQRIVSHFLHVDVZHOODVRWKHUDVSHFWV LQSDUWLFXODUUHODWLQJ
WRWKHYDOLGLW\RIWKH3RXUEDL[GLDJUDPLQWKHFRQFUHWHHQYLURQPHQW DUHGLVFXVVHGLQ WRWKHYDOLGLW\RIWKH3RXUEDL[GLDJUDPLQWKHFRQFUHWHHQYLURQPHQW DUHGLVFXVVHGLQ
GHWDLOLQ&KDSWHU GHWDLOLQ&KDSWHU
$V VXPPDULVHG LQ 7DEOH  VROHO\ IHUURXV LRQ IHUULF LRQ DQG ELK\SRIHUULWH LRQ $V VXPPDULVHG LQ 7DEOH  VROHO\ IHUURXV LRQ IHUULF LRQ DQG ELK\SRIHUULWH LRQ
+)H2í DUHVHOHFWHGDVVROXEOHVSHFLHV LRQV ZKLOHPDJQHWLWHDQGKHPDWLWHDUHVH +)H2í DUHVHOHFWHGDVVROXEOHVSHFLHV LRQV ZKLOHPDJQHWLWHDQGKHPDWLWHDUHVH
OHFWHG DV WKH RQO\ VROLG FRPSRXQGV EHVLGHV SXUH LURQ )LJXUH  LOOXVWUDWHV WKDW WKH OHFWHG DV WKH RQO\ VROLG FRPSRXQGV EHVLGHV SXUH LURQ )LJXUH  LOOXVWUDWHV WKDW WKH
VWDELOLW\GRPDLQVRIWKHVROXEOHLRQV )H)HDQG+)H2í FDQEHDVVRFLDWHGZLWK VWDELOLW\GRPDLQVRIWKHVROXEOHLRQV )H)HDQG+)H2í FDQEHDVVRFLDWHGZLWK
FRUURVLRQ GDUN JUH\  WKH VWDELOLW\ GRPDLQV ZKHUH IRUPDWLRQ RI VROLG VSHFLHV RWKHU FRUURVLRQ GDUN JUH\  WKH VWDELOLW\ GRPDLQV ZKHUH IRUPDWLRQ RI VROLG VSHFLHV RWKHU
WKDQSXUHLURQ )H2DQG)H2 LVWKHUPRG\QDPLFDOO\IDYRXUHGJLYHULVHWRSDVVLYLW\ WKDQSXUHLURQ )H2DQG)H2 LVWKHUPRG\QDPLFDOO\IDYRXUHGJLYHULVHWRSDVVLYLW\
OLJKW JUH\  DQG WKH DUHD ZKHUH LURQ LV WKHUPRG\QDPLFDOO\ VWDEOH FDQ EH DVVRFLDWHG OLJKW JUH\  DQG WKH DUHD ZKHUH LURQ LV WKHUPRG\QDPLFDOO\ VWDEOH FDQ EH DVVRFLDWHG
ZLWKLPPXQLW\ ZKLWH FI&KDSWHUµ7D'¶IRUWKHGHILQLWLRQRIWKHVHWKHUPRG\QDPLF ZLWKLPPXQLW\ ZKLWH FI&KDSWHUµ7D'¶IRUWKHGHILQLWLRQRIWKHVHWKHUPRG\QDPLF
VWDWHV VWDWHV
6LQFHWKH3RXUEDL[GLDJUDPLVEDVHGRQUHGXFWLRQSRWHQWLDOVWKHGLUHFWLRQRIWKHUHDF 6LQFHWKH3RXUEDL[GLDJUDPLVEDVHGRQUHGXFWLRQSRWHQWLDOVWKHGLUHFWLRQRIWKHUHDF
WLRQV UHGXFWLRQRUR[LGDWLRQ LQWKHDVVRFLDWHGVWDELOLW\GRPDLQVRIWKH)H+2V\V WLRQV UHGXFWLRQRUR[LGDWLRQ LQWKHDVVRFLDWHGVWDELOLW\GRPDLQVRIWKH)H+2V\V
WHPFDQEHLQWHUSUHWHGDVGHVFULEHGIRUKDOIFHOOUHDFWLRQV FI6HFWLRQ 7KLVDOVR WHPFDQEHLQWHUSUHWHGDVGHVFULEHGIRUKDOIFHOOUHDFWLRQV FI6HFWLRQ 7KLVDOVR
KROGVIRUWKHVWDELOLW\RIDUHDRIZDWHUZKLFKLVLQGLFDWHGE\WKHGDVKHGOLQHV:DWHULV KROGVIRUWKHVWDELOLW\RIDUHDRIZDWHUZKLFKLVLQGLFDWHGE\WKHGDVKHGOLQHV:DWHULV
WKHRUHWLFDOO\ VWDEOH EHWZHHQ WKH HTXLOLEULXP OLQHV  DQG  (TXLOLEULXP OLQH  FRUUH WKHRUHWLFDOO\ VWDEOH EHWZHHQ WKH HTXLOLEULXP OLQHV  DQG  (TXLOLEULXP OLQH  FRUUH
VSRQGVWRWKHKDOIFHOOUHDFWLRQGHVFULELQJK\GURJHQLRQUHGXFWLRQLQDFLGVROXWLRQV VSRQGVWRWKHKDOIFHOOUHDFWLRQGHVFULELQJK\GURJHQLRQUHGXFWLRQLQDFLGVROXWLRQV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

+ + + H − → +  (( 
 =  ^` P96+( )  >@ + + + H − → +  (( 
 =  ^` P96+( )  >@

%\PHDQVRIWKH1HUQVWHTXDWLRQIRUVWDQGDUGWHPSHUDWXUHRQƒ& FI6HFWLRQ  %\PHDQVRIWKH1HUQVWHTXDWLRQIRUVWDQGDUGWHPSHUDWXUHRQƒ& FI6HFWLRQ 

§ D ( ) ( ) · § D ( ) ( ) ·
Y 3 Y 3] Y 3 Y 3]
 ×  × D 3]  ×  × D 3]
× ORJ ¨ ¸ × ORJ ¨ ¸
 3  3
( = ( − >@ ( = ( − >@
¨ D ¸ ¨ D ¸
( ) ×  × ( D ) ( ) ×  × ( D )
 Y 5 Y5 ]  Y 5 Y5 ]
Q Q
© 5 5] ¹ © 5 5] ¹
WKHIXQFWLRQVIRUWKHHTXLOLEULXPOLQHVLHWKHHTXLOLEULXPSRWHQWLDOOLQHVIRUKDOIFHOO WKHIXQFWLRQVIRUWKHHTXLOLEULXPOLQHVLHWKHHTXLOLEULXPSRWHQWLDOOLQHVIRUKDOIFHOO
UHDFWLRQV W\SH,DQG,, FDQEHFDOFXODWHG&RQVLGHULQJWKHSDUWLDOK\GURJHQSUHVVXUH UHDFWLRQV W\SH,DQG,, FDQEHFDOFXODWHG&RQVLGHULQJWKHSDUWLDOK\GURJHQSUHVVXUH
µS+¶HTXDOWRDQGLQVHUWLQJWKHFRUUHVSRQGLQJµ(¶DQGWKHLQYROYHGDFWLYLWLHVDQG µS+¶HTXDOWRDQGLQVHUWLQJWKHFRUUHVSRQGLQJµ(¶DQGWKHLQYROYHGDFWLYLWLHVDQG
FRHIILFLHQWVLQWRWKH1HUQVWHTXDWLRQ>@OHDGVWRWKHS+GHSHQGHQWW\SH,HTXLOLE FRHIILFLHQWVLQWRWKH1HUQVWHTXDWLRQ>@OHDGVWRWKHS+GHSHQGHQWW\SH,HTXLOLE
ULXPOLQH ULXPOLQH

§ D ( ) · § D ( ) ·

Y+ 
Y+

  ¨ +
¸   ¨ +
¸
(  ++  + = ( − × ORJ (  ++  + = ( − × ORJ
¨ D Y++ ¸ ¨ D Y++ ¸
© ( ++ ) © ( ++ )
 

Q 
Q
¹ ¹
§  · §  ·
(  ++  + =  −

× ORJ ¨
() ¸  >@ (  ++  + =  −

× ORJ ¨
() ¸  >@
¨ D ¸ ¨ D ¸
© ( ++ ) ¹ © ( ++ ) ¹

 


(  ++  + = −  × S+ (  ++  + = −  × S+
 

(TXLOLEULXPOLQHFDQEHGHULYHGDFFRUGLQJO\IRUWKHHTXLYDOHQWK\GURJHQLRQUHGXF (TXLOLEULXPOLQHFDQEHGHULYHGDFFRUGLQJO\IRUWKHHTXLYDOHQWK\GURJHQLRQUHGXF
WLRQ UHDFWLRQ IRU WKH QHXWUDO DQG DONDOLQH HQYLURQPHQW ZKLFK LV REWDLQHG E\ DGGLQJ WLRQ UHDFWLRQ IRU WKH QHXWUDO DQG DONDOLQH HQYLURQPHQW ZKLFK LV REWDLQHG E\ DGGLQJ
VXIILFLHQWK\GUR[\OWRERWKVLGHVRIKDOIFHOOUHDFWLRQ>@ VXIILFLHQWK\GUR[\OWRERWKVLGHVRIKDOIFHOOUHDFWLRQ>@

+  2 + H − → +  + 2+ − (( 
 = −  ^−` P96+( )  >@ +  2 + H − → +  + 2+ − (( 
 = −  ^−` P96+( )  >@

+HQFH WKH <D[LV LQWHUFHSW DW S+  DJUHHV ZLWK WKH µ(¶ RI WKH K\GURJHQ LRQ +HQFH WKH <D[LV LQWHUFHSW DW S+  DJUHHV ZLWK WKH µ(¶ RI WKH K\GURJHQ LRQ
UHGXFWLRQ UHDFWLRQ LQ DFLG VROXWLRQV >@ DQG WKH <D[LV LQWHUFHSW DW S+  UHGXFWLRQ UHDFWLRQ LQ DFLG VROXWLRQV >@ DQG WKH <D[LV LQWHUFHSW DW S+ 
FRUUHVSRQGVWRWKHµ(¶RIWKHK\GURJHQLRQUHGXFWLRQUHDFWLRQLQQHXWUDODQGDONDOLQH FRUUHVSRQGVWRWKHµ(¶RIWKHK\GURJHQLRQUHGXFWLRQUHDFWLRQLQQHXWUDODQGDONDOLQH
VROXWLRQV>@ VROXWLRQV>@
7KHRUHWLFDOO\HTXLOLEULXPOLQHUHSUHVHQWVWKHUHGXFWLRQSRWHQWLDORIZDWHUVDWXUDWHG 7KHRUHWLFDOO\HTXLOLEULXPOLQHUHSUHVHQWVWKHUHGXFWLRQSRWHQWLDORIZDWHUVDWXUDWHG
ZLWK + DW EDU LH WKH R[\JHQGHSULYHG RU D UHGXFLQJ HQYLURQPHQW FI 6HFWLRQ ZLWK + DW EDU LH WKH R[\JHQGHSULYHG RU D UHGXFLQJ HQYLURQPHQW FI 6HFWLRQ
  7KXV DW DQ\ SRWHQWLDO ORZHU WKDQ HTXLOLEULXP OLQH  ZDWHU LV WKHRUHWLFDOO\   7KXV DW DQ\ SRWHQWLDO ORZHU WKDQ HTXLOLEULXP OLQH  ZDWHU LV WKHRUHWLFDOO\
WKHUPRG\QDPLFDOO\ XQVWDEOH DQG + LV IRUPHG 6WDUWLQJ LQ DFLG VROXWLRQ + LV ILUVW WKHUPRG\QDPLFDOO\ XQVWDEOH DQG + LV IRUPHG 6WDUWLQJ LQ DFLG VROXWLRQ + LV ILUVW
FRQVXPHGDFFRUGLQJWRWKHKDOIFHOOUHDFWLRQ>@XQWLOWKHS+LQFUHDVHVVXIILFLHQWO\ FRQVXPHGDFFRUGLQJWRWKHKDOIFHOOUHDFWLRQ>@XQWLOWKHS+LQFUHDVHVVXIILFLHQWO\
VRWKDWZDWHULVGHFRPSRVHGGLUHFWO\WR+DVGHVFULEHGE\KDOIFHOO UHDFWLRQ>@ VRWKDWZDWHULVGHFRPSRVHGGLUHFWO\WR+DVGHVFULEHGE\KDOIFHOO UHDFWLRQ>@
&RUUHVSRQGLQJO\DERYHHTXLOLEULXPOLQH+LVR[LGLVHGWR+RUZDWHU7KXVEHORZ &RUUHVSRQGLQJO\DERYHHTXLOLEULXPOLQH+LVR[LGLVHGWR+RUZDWHU7KXVEHORZ
HTXLOLEULXPOLQHDQ\ZDWHUSUHVHQWLVVWHDGLO\UHGXFHGWR+7KLVPHDQVWKDWZDWHU HTXLOLEULXPOLQHDQ\ZDWHUSUHVHQWLVVWHDGLO\UHGXFHGWR+7KLVPHDQVWKDWZDWHU
DW DQ\ S+ LV UHGXFHG WR + E\ DQ\ GLVVROYHG UHGXFWDQW ZLWK D SRWHQWLDO ORZHU WKDQ DW DQ\ S+ LV UHGXFHG WR + E\ DQ\ GLVVROYHG UHGXFWDQW ZLWK D SRWHQWLDO ORZHU WKDQ
íP96+(+RZHYHUDVLQGLFDWHGLQ6HFWLRQLQSUDFWLFHNLQHWLFHIIHFWVLQIOX íP96+(+RZHYHUDVLQGLFDWHGLQ6HFWLRQLQSUDFWLFHNLQHWLFHIIHFWVLQIOX
HQFHWKHDFWXDOHOHFWURGHSRWHQWLDOIRUK\GURJHQLRQUHGXFWLRQ FI6HFWLRQVDQG HQFHWKHDFWXDOHOHFWURGHSRWHQWLDOIRUK\GURJHQLRQUHGXFWLRQ FI6HFWLRQVDQG

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

 $VRFDOOHGK\GURJHQRYHUSRWHQWLDOFDQEHFRQVLGHUHGWRGLVSODFHHTXLOLEULXP  $VRFDOOHGK\GURJHQRYHUSRWHQWLDOFDQEHFRQVLGHUHGWRGLVSODFHHTXLOLEULXP


OLQHE\DERXWP9LQWKHDFWLYHGLUHFWLRQ>:28@ OLQHE\DERXWP9LQWKHDFWLYHGLUHFWLRQ>:28@
(TXLOLEULXPOLQHFRUUHVSRQGVWRWKHKDOIFHOOUHDFWLRQGHVFULELQJUHGXFWLRQRIR[\ (TXLOLEULXPOLQHFRUUHVSRQGVWR WKHKDOIFHOOUHDFWLRQGHVFULELQJUHGXFWLRQRIR[\
JHQLQWKHDFLGVROXWLRQV JHQLQWKHDFLGVROXWLRQV

2 + + + + H − → +  2 (( 
 =  {} P96+( )  >@ 2 + + + + H − → +  2 (( 
 =  {} P96+( )  >@

&RQVLGHULQJWKHR[\JHQSDUWLDOSUHVVXUHµS2¶HTXDOWRDQGLQVHUWLQJWKHFRUUHVSRQG &RQVLGHULQJWKHR[\JHQSDUWLDOSUHVVXUHµS2¶HTXDOWRDQGLQVHUWLQJWKHFRUUHVSRQG
LQJ µ(¶ DQG WKH LQYROYHG DFWLYLWLHV DQG FRHIILFLHQWV LQWR >@OHDGV WRWKH S+ GH LQJ µ(¶ DQG WKH LQYROYHG DFWLYLWLHV DQG FRHIILFLHQWV LQWR >@OHDGV WRWKH S+ GH
SHQGHQWW\SH,HTXLOLEULXPOLQH SHQGHQWW\SH,HTXLOLEULXPOLQH

§ ( ) · § ( ) ·
Y+ 2 Y+ 2
 D + 2   D + 2 
( 2  + 2 
= ( − × ORJ ¨ ¸ ( 2  + 2 
= ( − × ORJ ¨ ¸
¨ D Y 2 × D Y + + ¸ ¨ D Y 2 × D Y + + ¸
( ) ( ++ ) ( ) ( ++ )
 
Q Q
© 2 ¹ © 2 ¹
§ · § ·
() ()
 
 ¨ ¸  ¨ ¸
( 2  + 2 =  − × ORJ  >@ ( 2  + 2 =  − × ORJ  >@
¨ () × D
( + ) ¹¸ ¨ () × D
( + ) ¹¸
 
 
© +
© +

( 2  + 2 =  −  × S+ ( 2  + 2 =  −  × S+

,QDQDORJ\WRHTXLOLEULXPOLQHHTXLOLEULXPOLQHFDQDOVREHGHULYHGIRUWKHHTXLYD ,QDQDORJ\WRHTXLOLEULXPOLQHHTXLOLEULXPOLQHFDQDOVREHGHULYHGIRUWKHHTXLYD
OHQWR[\JHQUHGXFWLRQUHDFWLRQIRUWKHQHXWUDODQGDONDOLQHHQYLURQPHQWZKLFKLVRE OHQWR[\JHQUHGXFWLRQUHDFWLRQIRUWKHQHXWUDODQGDONDOLQHHQYLURQPHQWZKLFKLVRE
WDLQHGE\DGGLQJVXIILFLHQWK\GUR[\OWRERWKVLGHVRIKDOIFHOOUHDFWLRQ>@ WDLQHGE\DGGLQJVXIILFLHQWK\GUR[\OWRERWKVLGHVRIKDOIFHOOUHDFWLRQ>@

2 + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@ 2 + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@

0RUHRYHUDVIRUHTXLOLEULXPOLQHWKH<D[LVLQWHUFHSWDWS+DJUHHVZLWKWKHµ(¶ 0RUHRYHUDVIRUHTXLOLEULXPOLQHWKH<D[LVLQWHUFHSWDWS+DJUHHVZLWKWKHµ(¶
RI WKH R[\JHQ UHGXFWLRQ UHDFWLRQ LQ DFLG VROXWLRQV >@ DQGWKH <D[LV LQWHUFHSW DW RI WKH R[\JHQ UHGXFWLRQ UHDFWLRQ LQ DFLG VROXWLRQV >@ DQGWKH <D[LV LQWHUFHSW DW
S+  FRUUHVSRQGV WR WKH µ(¶ RI WKH R[\JHQ UHGXFWLRQ UHDFWLRQ LQ QHXWUDO DQG S+  FRUUHVSRQGV WR WKH µ(¶ RI WKH R[\JHQ UHGXFWLRQ UHDFWLRQ LQ QHXWUDO DQG
DONDOLQHVROXWLRQV>@ DONDOLQHVROXWLRQV>@
7KHRUHWLFDOO\HTXLOLEULXPOLQHUHSUHVHQWVWKHUHGXFWLRQSRWHQWLDORIZDWHUVDWXUDWHG 7KHRUHWLFDOO\HTXLOLEULXPOLQHUHSUHVHQWVWKHUHGXFWLRQSRWHQWLDORIZDWHUVDWXUDWHG
ZLWK2DWEDULHDQR[\JHQULFKRUR[LGLVLQJHQYLURQPHQW FI6HFWLRQ $W ZLWK2DWEDULHDQR[\JHQULFKRUR[LGLVLQJHQYLURQPHQW FI6HFWLRQ $W
DQ\SRWHQWLDOKLJKHUWKDQHTXLOLEULXPOLQHZDWHULVLQWKHRU\WKHUPRG\QDPLFDOO\XQ DQ\SRWHQWLDOKLJKHUWKDQHTXLOLEULXPOLQHZDWHULVLQWKHRU\WKHUPRG\QDPLFDOO\XQ
VWDEOHDQG2LVIRUPHG7KXVDERYHWKLVHTXLOLEULXPOLQHDQ\ZDWHUSUHVHQWLVVWHDG VWDEOHDQG2LVIRUPHG7KXVDERYHWKLVHTXLOLEULXPOLQHDQ\ZDWHUSUHVHQWLVVWHDG
LO\R[LGLVHGWR27KLVPHDQVWKDWZDWHUDWDQ\S+LVR[LGLVHGWR2E\DQ\GLVVROYHG LO\R[LGLVHGWR27KLVPHDQVWKDWZDWHUDWDQ\S+LVR[LGLVHGWR2E\DQ\GLVVROYHG
R[LGDQW ZLWK D SRWHQWLDO KLJKHU WKDQ P96+( +RZHYHU LQ FRUUHVSRQGHQFH ZLWK R[LGDQW ZLWK D SRWHQWLDO KLJKHU WKDQ P96+( +RZHYHU LQ FRUUHVSRQGHQFH ZLWK
HTXLOLEULXPOLQHLQSUDFWLFHDVRFDOOHGR[\JHQRYHUSRWHQWLDOGLVSODFHVHTXLOLEULXP HTXLOLEULXPOLQHLQSUDFWLFHDVRFDOOHGR[\JHQRYHUSRWHQWLDOGLVSODFHVHTXLOLEULXP
OLQHLQWKHQREOHGLUHFWLRQ FI6HFWLRQVDQG $FFRUGLQJWR>:28@ OLQHLQWKHQREOHGLUHFWLRQ FI6HFWLRQVDQG $FFRUGLQJWR>:28@
WKHPDJQLWXGHRIWKLVGLVSODFHPHQWIRU)H+2V\VWHPFDQEHDOVRFRQVLGHUHGWREHLQ WKHPDJQLWXGHRIWKLVGLVSODFHPHQWIRU)H+2V\VWHPFDQEHDOVRFRQVLGHUHGWREHLQ
WKHUDQJHRIP9 WKHUDQJHRIP9
$FFRUGLQJO\WKHGLDJUDPFDQEHVXEGLYLGHGLQWRWKUHHUHJLRQVRIPDMRULPSRUWDQFH $FFRUGLQJO\WKHGLDJUDPFDQEHVXEGLYLGHGLQWRWKUHH UHJLRQVRIPDMRULPSRUWDQFH
DPRQJ RWKHUV IRU WKH DFWLQJ FDWKRGLF UHDFWLRQV DQG DFFRUGLQJO\ WKH FRUURVLRQ UDWH DPRQJ RWKHUV IRU WKH DFWLQJ FDWKRGLF UHDFWLRQV DQG DFFRUGLQJO\ WKH FRUURVLRQ UDWH
:LWKUHJDUGWRWKHWKHRU\RQFDWKRGLFUHDFWLRQVGHVFULEHGLQ6HFWLRQDQGWKHFD :LWKUHJDUGWRWKHWKHRU\RQFDWKRGLFUHDFWLRQVGHVFULEHGLQ6HFWLRQDQGWKHFD
WKRGLFUHDFWLRQVOLVWHGLQ6HFWLRQLWFDQEHFRQFOXGHGWKDWUHGXFWLRQRIR[\JHQLV WKRGLFUHDFWLRQVOLVWHGLQ6HFWLRQLWFDQEHFRQFOXGHGWKDWUHGXFWLRQRIR[\JHQLV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

WKH RQO\ SRVVLEOH FDWKRGLF UHDFWLRQ LQ WKH VWDELOLW\ GRPDLQ RI ZDWHU DQG KHQFH WKH WKH RQO\ SRVVLEOH FDWKRGLF UHDFWLRQ LQ WKH VWDELOLW\ GRPDLQ RI ZDWHU DQG KHQFH WKH
GRPLQDQWFDWKRGLFUHDFWLRQIRUVWHHOLQDQDTXHRXVV\VWHP)RUK\GURJHQUHDFWLRQWR GRPLQDQWFDWKRGLFUHDFWLRQIRUVWHHOLQDQDTXHRXVV\VWHP)RUK\GURJHQUHDFWLRQWR
FRQWULEXWHLQWKHFDWKRGLFSURFHVVWKHHOHFWURGHSRWHQWLDO FI6HFWLRQ ZRXOGDW FRQWULEXWHLQWKHFDWKRGLFSURFHVVWKHHOHFWURGHSRWHQWLDO FI6HFWLRQ ZRXOGDW
OHDVWQHHGWREHORZHUWKDQHTXLOLEULXPOLQHPLQXVWKHK\GURJHQRYHUSRWHQWLDOGLV OHDVWQHHGWREHORZHUWKDQHTXLOLEULXPOLQHPLQXVWKHK\GURJHQRYHUSRWHQWLDOGLV
SODFHPHQWRIDERXWP9 SODFHPHQWRIDERXWP9
7KH HTXLOLEULXP OLQHV ERXQGLQJ WKH VWDELOLW\ GRPDLQV RI WKH LURQ VSHFLHV DUH GHWHU 7KH HTXLOLEULXP OLQHV ERXQGLQJ WKH VWDELOLW\ GRPDLQV RI WKH LURQ VSHFLHV DUH GHWHU
PLQHGLQWKHVDPHZD\DVH[HPSOLILHGIRUWKHK\GURJHQDQGR[\JHQHTXLOLEULXPOLQH PLQHGLQWKHVDPHZD\DVH[HPSOLILHGIRUWKHK\GURJHQDQGR[\JHQHTXLOLEULXPOLQH
,QWKHIROORZLQJWKHHVWDEOLVKPHQWRIWKHWZRRWKHUW\SHVRIHTXLOLEULXPOLQHVDVZHOO ,QWKHIROORZLQJWKHHVWDEOLVKPHQWRIWKHWZRRWKHUW\SHVRIHTXLOLEULXPOLQHVDVZHOO
DVIRUDOOSRVVLEOHHTXLOLEULDEHWZHHQVROXEOHDQGVROLGVSHFLHVLVH[HPSOLILHG DVIRUDOOSRVVLEOHHTXLOLEULDEHWZHHQVROXEOHDQGVROLGVSHFLHVLVH[HPSOLILHG
(TXLOLEULXPOLQHUHSUHVHQWVWKHHTXLOLEULXPEHWZHHQWKHVROXEOHVSHFLHV)HDQGWKH (TXLOLEULXPOLQHUHSUHVHQWVWKHHTXLOLEULXPEHWZHHQWKHVROXEOHVSHFLHV)HDQGWKH
VROLGVWDWH)HLHEHWZHHQFRUURVLRQDQGLPPXQLW\UHVSHFWLYHO\,WFRUUHVSRQGVWRWKH VROLGVWDWH)HLHEHWZHHQFRUURVLRQDQGLPPXQLW\UHVSHFWLYHO\,WFRUUHVSRQGVWRWKH
KDOIFHOOUHDFWLRQGHVFULELQJUHGXFWLRQRIIHUURXVLRQ KDOIFHOOUHDFWLRQGHVFULELQJUHGXFWLRQRIIHUURXVLRQ

)H + + H− → )H (( 
 −  {−} P96+( )  >@ )H + + H− → )H (( 
 −  {−} P96+( )  >@

,QVHUWLQJ WKH FRUUHVSRQGLQJ µ(¶ DQG WKH LQYROYHG DFWLYLWLHV DQG FRHIILFLHQWV LQWR ,QVHUWLQJ WKH FRUUHVSRQGLQJ µ(¶ DQG WKH LQYROYHG DFWLYLWLHV DQG FRHIILFLHQWV LQWR
>@OHDGVWRWKHS+LQGHSHQGHQWLHKRUL]RQWDOW\SH,,HTXLOLEULXPOLQH >@OHDGVWRWKHS+LQGHSHQGHQWLHKRUL]RQWDOW\SH,,HTXLOLEULXPOLQH

§ D Y)H · § D Y)H ·
(  )H+  )H 
= ( −

× ORJ ¨
( )H ) ¸ (  )H+  )H 
= ( −

× ORJ ¨
( )H ) ¸
¨ ¸ ¨ ¸
( ) ( )
 Y +  Y +
 
© D )H+ © D )H+
)H )H

¹ ¹
§  · §  ·
(  )H+  )H = −  −

× ORJ ¨
( ) ¸ >@ (  )H+  )H = −  −

× ORJ ¨
( ) ¸ >@
 ¨ (− ) ¸  ¨ (− ) ¸
© ¹ © ¹
(  )H+  )H = −  (  )H+  )H = − 

7KDWPHDQVWKDWDWDSRWHQWLDORIíP96+(KDOIRIWKHíPRO/RI)HLVFRUURGLQJ 7KDWPHDQVWKDWDWDSRWHQWLDORIíP96+(KDOIRIWKHíPRO/RI)HLVFRUURGLQJ
DVVROXEOH)HZKLOHWKHRWKHUKDOIUHPDLQVLPPXQH6ROXEOH)HGRPLQDWHVDQGFRU DVVROXEOH)HZKLOHWKHRWKHUKDOIUHPDLQVLPPXQH6ROXEOH)HGRPLQDWHVDQGFRU
URVLRQWDNHVSODFHLIWKHSRWHQWLDOLVKLJKHUWKDQíP96+(DQGVROLGLPPXQH)H URVLRQWDNHVSODFHLIWKHSRWHQWLDOLVKLJKHUWKDQíP96+(DQGVROLGLPPXQH)H
GRPLQDWHVLIWKHSRWHQWLDOORZHUWKDQíP96+( GRPLQDWHVLIWKHSRWHQWLDOORZHUWKDQíP96+(
(TXLOLEULXP OLQH  LV DQRWKHU W\SH ,, HTXLOLEULXP OLQH ZKLFK UHSUHVHQWV WKH (TXLOLEULXP OLQH  LV DQRWKHU W\SH ,, HTXLOLEULXP OLQH ZKLFK UHSUHVHQWV WKH
HTXLOLEULXPEHWZHHQWKHWZRVROXEOHVSHFLHV)HDQG)HLHERWKDGMDFHQWVWDELOLW\ HTXLOLEULXPEHWZHHQWKHWZRVROXEOHVSHFLHV)HDQG)HLHERWKDGMDFHQWVWDELOLW\
GRPDLQVDUHWKHUPRG\QDPLFDOO\IDYRXUHGWREHFRUURVLYH,WFRUUHVSRQGVWRWKHKDOI GRPDLQVDUHWKHUPRG\QDPLFDOO\IDYRXUHGWREHFRUURVLYH,WFRUUHVSRQGVWRWKHKDOI
FHOOUHDFWLRQGHVFULELQJWKHUHGXFWLRQRIIHUULFLRQ FHOOUHDFWLRQGHVFULELQJWKHUHGXFWLRQRIIHUULFLRQ

)H+ + H − → )H  + (( 
 =  {} P96+( )  >@ )H+ + H − → )H  + (( 
 =  {} P96+( )  >@

,QDQDORJ\WRWKHDERYHWKHHTXLOLEULXPOLQHLVREWDLQHGE\LQVHUWLQJWKHFRUUHVSRQG ,QDQDORJ\WRWKHDERYHWKHHTXLOLEULXPOLQHLVREWDLQHGE\LQVHUWLQJWKHFRUUHVSRQG
LQJµ(¶DQGWKHLQYROYHGDFWLYLWLHVDQGFRHIILFLHQWVLQWR>@ZKLFKOHDGVWR LQJµ(¶DQGWKHLQYROYHGDFWLYLWLHVDQGFRHIILFLHQWVLQWR>@ZKLFKOHDGVWR
(  )H+  )H + =   >@ (  )H+  )H + =   >@

7KHW\SH,HTXLOLEULXPOLQHEHWZHHQLPPXQLW\DQGSDVVLYLW\UHSUHVHQWVWKHHTXLOLE 7KHW\SH,HTXLOLEULXPOLQHEHWZHHQLPPXQLW\DQGSDVVLYLW\UHSUHVHQWVWKHHTXLOLE
ULXPEHWZHHQWKHWZRVROLGFRPSRXQGV)HDQG)H2 ULXPEHWZHHQWKHWZRVROLGFRPSRXQGV)HDQG)H2

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

)H2  + + + + H− → )H + + 2 (( 


 = −  P96+( )  >@ )H2  + + + + H− → )H + + 2 (( 
 = −  P96+( )  >@

,QVHUWLQJ WKH LQYROYHG DFWLYLWLHV DQG WKH FRUUHVSRQGLQJ µ(¶ LQWR >@ OHDGV WR WKH ,QVHUWLQJ WKH LQYROYHG DFWLYLWLHV DQG WKH FRUUHVSRQGLQJ µ(¶ LQWR >@ OHDGV WR WKH
HTXLOLEULXPOLQHEHWZHHQSDVVLYHFRPSRXQG)H2DQGLPPXQH)H HTXLOLEULXPOLQHEHWZHHQSDVVLYHFRPSRXQG)H2DQGLPPXQH)H
(  )H2  )H = −  −  × S+  >@ (  )H2  )H = −  −  × S+  >@

7KHW\SH ,,, HTXLOLEULXPOLQHEHWZHHQWKHWZRVSHFLHVLQWKH VDPHR[LGDWLRQVWDWH 7KHW\SH ,,, HTXLOLEULXPOLQHEHWZHHQWKHWZRVSHFLHVLQWKH VDPHR[LGDWLRQVWDWH


VROXEOH)HDQGSDVVLYH)H2,WFRUUHVSRQGVWRWKHDFLGEDVHUHDFWLRQ VROXEOH)HDQGSDVVLYH)H2,WFRUUHVSRQGVWRWKHDFLGEDVHUHDFWLRQ

)H 2 + + + → )H+ + + 2 ( Δ* 
= −  N- )  >@ )H 2 + + + → )H+ + + 2 ( Δ* 
= −  N- )  >@

)RU WKH FDOFXODWLRQ RI HTXLOLEULXP OLQHV RI DFLGEDVH UHDFWLRQV EDVHG RQ D NQRZQ )RU WKH FDOFXODWLRQ RI HTXLOLEULXP OLQHV RI DFLGEDVH UHDFWLRQV EDVHG RQ D NQRZQ
µ¨*¶WKHHTXLOLEULXPS+FDQEHFDOFXODWHGEDVHGRQWKHHTXDWLRQIRUµ¨*¶IRUQRQ µ¨*¶WKHHTXLOLEULXPS+FDQEHFDOFXODWHGEDVHGRQWKHHTXDWLRQIRUµ¨*¶IRUQRQ
VWDQGDUGVWDWHVGHULYHGLQ6HFWLRQ VWDQGDUGVWDWHVGHULYHGLQ6HFWLRQ

§ D ( ) ( ) · § D ( ) ( ) ·
Y 3 Y 3] Y 3 Y 3]
×  × D 3] ×  × D 3]
Δ* = −  × ORJ ¨ ¸ Δ* = −  × ORJ ¨ ¸
 3  3
>@ >@
¨ D ¸ ¨ D ¸
( ) ×  × ( D ) ( ) ×  × ( D )
Y 5 Y5 ] Y 5 Y5 ]

© 5 5] ¹ © 5 5] ¹
,QVHUWLQJWKHLQYROYHGDFWLYLWLHVDQGWKHFRUUHVSRQGLQJµ¨*¶LQWR>@OHDGVWRWKH ,QVHUWLQJWKHLQYROYHGDFWLYLWLHVDQGWKHFRUUHVSRQGLQJµ¨*¶LQWR>@OHDGVWRWKH
S+YDOXHWKDWGHILQHVWKHSRVLWLRQRIWKHYHUWLFDOHTXLOLEULXPOLQH S+YDOXHWKDWGHILQHVWKHSRVLWLRQRIWKHYHUWLFDOHTXLOLEULXPOLQH

§ D + Y)H+ × D
( ) ( ) · § D + Y)H+ × D
( ) ( ) ·
Y + 2 Y + 2


Δ* = −  × ORJ ¨ )H +2
¸ 
Δ* = −  × ORJ ¨ )H +2
¸
¨ D ¸ ¨ D ¸
( ) × ( D ++ ) + ( ) × ( D ++ ) +
Y )H2 Y + Y )H2 Y +

© )H  2  ¹ © )H  2  ¹

− = −  × ORJ


( ) × ()
−  

 >@ − = −  × ORJ


( ) × ()
−  

 >@
() × ( + ) + 
() × ( + ) + 
 

S+ )H 2  )H+
=  S+ )H 2  )H+
= 
   

7KHDERYHH[HPSOLILFDWLRQVFRYHUDOOSRVVLEOHFRPELQDWLRQVIRUWKHHVWDEOLVKPHQWRI 7KHDERYHH[HPSOLILFDWLRQVFRYHUDOOSRVVLEOHFRPELQDWLRQVIRUWKHHVWDEOLVKPHQWRI
WKHHTXLOLEULXPOLQHVLQWKH)H+23RXUEDL[GLDJUDP7KHKDOIFHOOUHDFWLRQVGHWHU WKHHTXLOLEULXPOLQHVLQWKH)H+23RXUEDL[GLDJUDP7KHKDOIFHOO UHDFWLRQVGHWHU
PLQLQJ WKH UHPDLQLQJ HTXLOLEULXP OLQHV ZKLFK DUH DOO RI W\SH , DUH OLVWHG EHORZ WR PLQLQJ WKH UHPDLQLQJ HTXLOLEULXP OLQHV ZKLFK DUH DOO RI W\SH , DUH OLVWHG EHORZ WR
JHWKHUZLWKWKHLUODEHODFFRUGLQJWR)LJXUH>%@DQGWKHLUDVVRFLDWHGµ(¶ JHWKHUZLWKWKHLUODEHODFFRUGLQJWR)LJXUH>%@DQGWKHLUDVVRFLDWHGµ(¶

 )H2  + + + + H − → )H + + +  2 (( 


 =  P96+( )  >@  )H2  + + + + H − → )H + + +  2 (( 
 =  P96+( )  >@

 )H 2 + + + + H − → )H + + +  2 (( 


 =  P96+( )  >@  )H 2 + + + + H − → )H + + +  2 (( 
 =  P96+( )  >@

 +)H2 − + + + + H − → )H + + 2 (( 
 =  P96+( )  >@  +)H2 − + + + + H − → )H + + 2 (( 
 =  P96+( )  >@

 )H  2 + + + + H − → )H2  + +  2 (( 


 =  P96+( )  >@  )H  2 + + + + H − → )H2  + +  2 (( 
 =  P96+( )  >@

 )H2  + +  2 + H− → +)H2 − + + + (( 


 = −  P96+( )  >@  )H2  + +  2 + H− → +)H2 − + + + (( 
 = −  P96+( )  >@

 )H 2 + + 2 + H − → +)H2 − (( 


 = −  P96+( )  >@  )H 2 + + 2 + H − → +)H2 − (( 
 = −  P96+( )  >@

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

%DVHGRQWKHVHHTXLOLEULXPOLQHVZKLFKDUHUHSUHVHQWHGLQFRPELQDWLRQZLWKWKHDVVR %DVHGRQWKHVHHTXLOLEULXPOLQHVZKLFKDUHUHSUHVHQWHGLQFRPELQDWLRQZLWKWKHDVVR
FLDWHGVWDELOLW\GRPDLQVLQ)LJXUH>%@VRPHREYLRXVSUHOLPLQDU\FRQFOXVLRQVRQ FLDWHGVWDELOLW\GRPDLQV LQ)LJXUH>%@VRPH REYLRXVSUHOLPLQDU\ FRQFOXVLRQVRQ
WKH WKHUPRG\QDPLFV RI LURQ FDQ EH PDGH 7KHVH DUH H[WHQGHG DQG FRUUHODWHG ZLWK WKH WKHUPRG\QDPLFV RI LURQ FDQ EH PDGH 7KHVH DUH H[WHQGHG DQG FRUUHODWHG ZLWK
RWKHU DVSHFWV RI )H+2 V\VWHPV DV ZHOO DV 3RXUEDL[ GLDJUDPV IRU RWKHU PHWDOV DQG RWKHU DVSHFWV RI )H+2 V\VWHPV DV ZHOO DV 3RXUEDL[ GLDJUDPV IRU RWKHU PHWDOV DQG
HOHPHQWV DQG WUDQVIHUUHG WR WKH FRQFUHWH HQYLURQPHQW FI &KDSWHUV  WR   )RU LQ HOHPHQWV DQG WUDQVIHUUHG WR WKH FRQFUHWH HQYLURQPHQW FI &KDSWHUV  WR   )RU LQ
VWDQFHLWLVQRWDEOHWKDWWKHGLVWDQFHEHWZHHQWKHHTXLOLEULXPOLQHVDQGZKLFK VWDQFHLWLVQRWDEOHWKDWWKHGLVWDQFHEHWZHHQWKHHTXLOLEULXPOLQHVDQGZKLFK
OLPLW WKH LPPXQH DUHD DQG HTXLOLEULXP OLQH  ZKLFK OLPLWV WKH VWDELOLW\ GRPDLQ RI OLPLW WKH LPPXQH DUHD DQG HTXLOLEULXP OLQH  ZKLFK OLPLWV WKH VWDELOLW\ GRPDLQ RI
ZDWHUGHFUHDVHVZLWKLQFUHDVLQJS+7KLVLQGLFDWHVWKDWWKHFRUURVLRQUDWHRILURQGH ZDWHUGHFUHDVHVZLWKLQFUHDVLQJS+7KLVLQGLFDWHVWKDWWKHFRUURVLRQUDWHRILURQGH
FUHDVHVZLWKLQFUHDVLQJVROXWLRQS+0RUHRYHULWFDQEHREVHUYHGWKDWLQDONDOLQHWR FUHDVHVZLWKLQFUHDVLQJVROXWLRQS+0RUHRYHULWFDQEHREVHUYHGWKDWLQDONDOLQHWR
QHXWUDOVROXWLRQVZLWKGLVVROYHGR[\JHQWKHSRWHQWLDOLVOLIWHGLQWRWKHSDVVLYHUHJLRQ QHXWUDOVROXWLRQVZLWKGLVVROYHGR[\JHQWKHSRWHQWLDOLVOLIWHGLQWRWKHSDVVLYHUHJLRQ
EXWEHORZQHXWUDOLW\WKHSDVVLYHOD\HULVQRWVWDEOHDQGGLVVROYHGR[\JHQLQFUHDVHVWKH EXWEHORZQHXWUDOLW\WKHSDVVLYHOD\HULVQRWVWDEOHDQGGLVVROYHGR[\JHQLQFUHDVHVWKH
FRUURVLRQUDWH7KXVEHVLGHVSURYLGLQJPRUHR[LGDWLRQSRZHUDFLGHQYLURQPHQWVGR FRUURVLRQUDWH7KXVEHVLGHVSURYLGLQJPRUHR[LGDWLRQSRZHUDFLGHQYLURQPHQWVGR
QRWDOORZIRUSDVVLYDWLRQRILURQDQGKHQFHOHDGWRKLJKFRUURVLRQUDWHVZKLFKLVDQ QRWDOORZIRUSDVVLYDWLRQRILURQDQGKHQFHOHDGWRKLJKFRUURVLRQUDWHVZKLFKLVDQ
LVVXHLQDTXHRXVFRUURVLRQRIPDQ\PHWDOV6RPHPRUHJHQHUDOREVHUYDWLRQVRQHTXL LVVXHLQDTXHRXVFRUURVLRQRIPDQ\PHWDOV6RPHPRUHJHQHUDOREVHUYDWLRQVRQHTXL
OLEULXPOLQHVLQWKH3RXUEDL[GLDJUDPIRUJHQHUDOµ0H¶+2V\VWHPVDQGWKHDVVRFL OLEULXPOLQHVLQWKH3RXUEDL[GLDJUDPIRUJHQHUDOµ0H¶+2V\VWHPVDQGWKHDVVRFL
DWHGVWDELOLW\GRPDLQVLQFOXGH DWHGVWDELOLW\GRPDLQVLQFOXGH
‡ 7KHSRVLWLRQRIDFLGEDVHHTXLOLEULDLVGHSHQGHQWRQWKHVHOHFWHGFRQFHQWUDWLRQ ‡ 7KHSRVLWLRQRIDFLGEDVHHTXLOLEULDLVGHSHQGHQWRQWKHVHOHFWHGFRQFHQWUDWLRQ
‡ ,QPRUHGLOXWHVROXWLRQVWKHVWDELOLW\GRPDLQVRIVROXEOHVSHFLHVDUHJHQHUDOO\ODU ‡ ,QPRUHGLOXWHVROXWLRQVWKHVWDELOLW\GRPDLQVRIVROXEOHVSHFLHVDUHJHQHUDOO\ODU
JHU JHU
‡ 'LDJRQDOERXQGDULHVJHQHUDOO\VORSHIURPXSSHUOHIWWRORZHUULJKWDVDONDOLQHVR ‡ 'LDJRQDOERXQGDULHVJHQHUDOO\VORSHIURPXSSHUOHIWWRORZHUULJKWDVDONDOLQHVR
OXWLRQVWHQGWRIDYRXUWKHVSHFLHVLQDKLJKHUR[LGDWLRQVWDWH OXWLRQVWHQGWRIDYRXUWKHVSHFLHVLQDKLJKHUR[LGDWLRQVWDWH
)XUWKHUPRUHVRPHJHQHUDOOLPLWDWLRQVFRQFHUQLQJWKH3RXUEDL[GLDJUDPDUHOLVWHG )XUWKHUPRUHVRPHJHQHUDOOLPLWDWLRQVFRQFHUQLQJWKH3RXUEDL[GLDJUDPDUHOLVWHG
‡ 7KH 3RXUEDL[ GLDJUDP GRHV RQO\ UHIOHFW WKH WKHUPRG\QDPLF VWDWH RI WKH VHOHFWHG ‡ 7KH 3RXUEDL[ GLDJUDP GRHV RQO\ UHIOHFW WKH WKHUPRG\QDPLF VWDWH RI WKH VHOHFWHG
HQYLURQPHQW IRU D FHUWDLQ VLWXDWLRQ LH FRQFHQWUDWLRQ WHPSHUDWXUH DQG SUHVVXUH HQYLURQPHQW IRU D FHUWDLQ VLWXDWLRQ LH FRQFHQWUDWLRQ WHPSHUDWXUH DQG SUHVVXUH
7KHHIIHFWVWKDWLQIOXHQFHWKHDFWXDOFRQGLWLRQVDWHJWKHVXUIDFHRIDPHWDOFDQ 7KHHIIHFWVWKDWLQIOXHQFHWKHDFWXDOFRQGLWLRQVDWHJWKHVXUIDFHRIDPHWDOFDQ
QRWEHGLUHFWO\DVVHVVHGDQGRQO\EHHVWLPDWHGE\WKHLQSXWSDUDPHWHUV QRWEHGLUHFWO\DVVHVVHGDQGRQO\EHHVWLPDWHGE\WKHLQSXWSDUDPHWHUV
‡ 7KH3RXUEDL[GLDJUDPGRHVQRWSURYLGHLQIRUPDWLRQRQWKHNLQHWLFVRIWKHLQYHVWL ‡ 7KH3RXUEDL[GLDJUDPGRHVQRWSURYLGHLQIRUPDWLRQRQWKHNLQHWLFVRIWKHLQYHVWL
JDWHG V\VWHP DQG LW GRHV QHFHVVDULO\ UHIOHFW LW HLWKHU )RU LQVWDQFH IRU VWDELOLW\ JDWHG V\VWHP DQG LW GRHV QHFHVVDULO\ UHIOHFW LW HLWKHU )RU LQVWDQFH IRU VWDELOLW\
GRPDLQV ZKHUH FRUURVLRQ LV WKHUPRG\QDPLFDOO\ IDYRXUHG QR SUHGLFWLRQV RQ WKH GRPDLQV ZKHUH FRUURVLRQ LV WKHUPRG\QDPLFDOO\ IDYRXUHG QR SUHGLFWLRQV RQ WKH
FRUURVLRQ UDWHV FDQEH PDGH &RUURVLRQ UDWHV FDQEH KLJK RU ORZFRQVLGHULQJWKH FRUURVLRQUDWHVFDQEHPDGH&RUURVLRQUDWHVFDQEHKLJKRUORZFRQVLGHULQJWKH
PRGHUDWHWHPSHUDWXUHVZKLFKDUHUHJDUGHGLQWKHSUHVHQWWKHVLV  PRGHUDWHWHPSHUDWXUHVZKLFKDUHUHJDUGHGLQWKHSUHVHQWWKHVLV 
‡ 7KH3RXUEDL[GLDJUDPGRHVQRWSURYLGHLQIRUPDWLRQRQWKHDFWXDOSURWHFWLYHIXQF ‡ 7KH3RXUEDL[GLDJUDPGRHVQRWSURYLGHLQIRUPDWLRQRQWKHDFWXDOSURWHFWLYHIXQF
WLRQLHWKHVWUXFWXUHDQGGHQVHQHVVRIWKHSDVVLYHOD\HUZKLFKJLYHVULVHWRVWD WLRQLHWKHVWUXFWXUHDQGGHQVHQHVVRIWKHSDVVLYHOD\HUZKLFKJLYHVULVHWRVWD
ELOLW\GRPDLQVZKHUHSDVVLYDWLRQLVWKHUPRG\QDPLFDOO\IDYRXUHG ELOLW\GRPDLQVZKHUHSDVVLYDWLRQLVWKHUPRG\QDPLFDOO\IDYRXUHG

 

$VRSSRVHGWRHJKLJKWHPSHUDWXUHFRUURVLRQZKHUHWKHHTXLOLEULXPLVUHDFKHGTXLWHUDSLGO\DQG $VRSSRVHGWRHJKLJKWHPSHUDWXUHFRUURVLRQZKHUHWKHHTXLOLEULXPLVUHDFKHGTXLWHUDSLGO\DQG
FRUURVLRQUDWHVDUHJHQHUDOO\KLJK FRUURVLRQUDWHVDUHJHQHUDOO\KLJK

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ 7KHUPRG\QDPLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

%HVLGHV WKH DERYH OLVWHG JHQHUDO OLPLWDWLRQV RWKHU UHVWULFWLRQV DQGRU LQDGHTXDFLHV %HVLGHV WKH DERYH OLVWHG JHQHUDO OLPLWDWLRQV RWKHU UHVWULFWLRQV DQGRU LQDGHTXDFLHV
DUHRIWHQSRVWXODWHGLQWKHOLWHUDWXUHLQFRQQHFWLRQZLWKWKH3RXUEDL[GLDJUDP$PRQJ DUHRIWHQSRVWXODWHGLQWKHOLWHUDWXUHLQFRQQHFWLRQZLWKWKH3RXUEDL[GLDJUDP$PRQJ
VHYHUDORWKHUVWKHPRVWLPSRUWDQWUHMHFWLRQVLQFOXGH VHYHUDORWKHUVWKHPRVWLPSRUWDQWUHMHFWLRQVLQFOXGH
‡ 3RXUEDL[GLDJUDPVDUHOLPLWHGWR0H+2V\VWHPVLHRQHPHWDOLQSXUHZDWHU ‡ 3RXUEDL[GLDJUDPVDUHOLPLWHGWR0H+2 V\VWHPV LH RQH PHWDO LQSXUH ZDWHU
DQGGRQRWWDNHLQWRFRQVLGHUDWLRQWKHLQIOXHQFHRIRWKHUVXEVWDQFHVZKLFKFDQDI DQGGRQRWWDNHLQWRFRQVLGHUDWLRQWKHLQIOXHQFHRIRWKHUVXEVWDQFHVZKLFKFDQDI
IHFWWKHWKHUPRG\QDPLFVRIWKHV\VWHPWRDODUJHH[WHQW IHFWWKHWKHUPRG\QDPLFVRIWKHV\VWHPWRDODUJHH[WHQW
‡ 6SHFLHVFRXOGEHWKHUPRG\QDPLFDOO\IDYRXUHGEXWWKHNLQHWLFVRILWVIRUPDWLRQLV ‡ 6SHFLHVFRXOGEHWKHUPRG\QDPLFDOO\IDYRXUHGEXWWKHNLQHWLFVRILWVIRUPDWLRQLV
VRVORZWKDWLWGRHVQRWSOD\DQ\UROHLQWKHLQYHVWLJDWHGV\VWHPRUWKHUPRG\QDPL VRVORZWKDWLWGRHVQRWSOD\DQ\UROHLQWKHLQYHVWLJDWHGV\VWHPRUWKHUPRG\QDPL
FDOO\XQVWDEOHVSHFLHVDUHSUHVHQWEHFDXVHRIVORZGHFRPSRVLWLRQ FDOO\XQVWDEOHVSHFLHVDUHSUHVHQWEHFDXVHRIVORZGHFRPSRVLWLRQ
‡ 7KHFKRLFHRILRQDFWLYLW\LVDUELWUDU\DQGGRHVQRWUHIOHFWWKHDFWXDOFRQGLWLRQVLQ ‡ 7KHFKRLFHRILRQDFWLYLW\LVDUELWUDU\DQGGRHVQRWUHIOHFWWKHDFWXDOFRQGLWLRQVLQ
WKHV\VWHP(YHQLIWKHLRQDFWLYLW\RIWKHEXONVROXWLRQLVNQRZQDQGDSSOLHGLW WKHV\VWHP(YHQLIWKHLRQDFWLYLW\RIWKHEXONVROXWLRQLVNQRZQDQGDSSOLHGLW
ZLOOODUJHO\GHYLDWHIURPWKHDFWXDOFRQFHQWUDWLRQRQWKHPHWDOVXUIDFHZKHUHWKH ZLOOODUJHO\GHYLDWHIURPWKHDFWXDOFRQFHQWUDWLRQRQWKHPHWDOVXUIDFHZKHUHWKH
HOHFWURFKHPLFDOUHDFWLRQVWDNHSODFHDQGKHQFHWKHWKHUPRG\QDPLFFKDUDFWHULVWLFV HOHFWURFKHPLFDOUHDFWLRQVWDNHSODFHDQGKHQFHWKHWKHUPRG\QDPLFFKDUDFWHULVWLFV
RIWKHV\VWHPDUHGHWHUPLQHG RIWKHV\VWHPDUHGHWHUPLQHG
:KLOH WKH JHQHUDO OLPLWDWLRQV DOZD\V DSSO\ WR 3RXUEDL[ GLDJUDPV DQG ZH WDNH WKHP :KLOH WKH JHQHUDO OLPLWDWLRQV DOZD\V DSSO\ WR 3RXUEDL[ GLDJUDPV DQG ZH WDNH WKHP
LQWRGXHFRQVLGHUDWLRQLQRXULQWHUSUHWDWLRQZHVXJJHVWWKDWWKHIUHTXHQWO\VWDWHGRWKHU LQWRGXHFRQVLGHUDWLRQLQRXULQWHUSUHWDWLRQZHVXJJHVWWKDWWKHIUHTXHQWO\VWDWHGRWKHU
UHVWULFWLRQV DQGRU LQDGHTXDFLHV FDQ EH RYHUFRPH E\ WKH SURSRVHG DSSURDFK IRU WKH UHVWULFWLRQV DQGRULQDGHTXDFLHV FDQ EH RYHUFRPH E\ WKH SURSRVHG DSSURDFK IRU WKH
HVWDEOLVKPHQW DQG DSSOLFDWLRQ RI FXVWRPLVHG 3RXUEDL[ GLDJUDPV ZKLFK LV GLVFXVVHG HVWDEOLVKPHQW DQG DSSOLFDWLRQ RI FXVWRPLVHG 3RXUEDL[ GLDJUDPV ZKLFK LV GLVFXVVHG
LQGHSWKLQ&KDSWHU7KLVDSSURDFKFRPSULVHVDFHQWUDODVSHFWLQRXUWKHUPRG\QDPLF LQGHSWKLQ&KDSWHU7KLVDSSURDFKFRPSULVHVDFHQWUDODVSHFWLQRXUWKHUPRG\QDPLF
DSSURDFKWRZDUGVWKHPDQDJHPHQWRIUHLQIRUFHPHQWVLQFHLWJRYHUQVRXUXQGHUVWDQG DSSURDFKWRZDUGVWKHPDQDJHPHQWRIUHLQIRUFHPHQWVLQFHLWJRYHUQVRXUXQGHUVWDQG
LQJDQGGHVFULSWLRQRIFRUURVLRQSURFHVVHVRIVWHHOLQFRQFUHWH FI&KDSWHU DVZHOO LQJDQGGHVFULSWLRQRIFRUURVLRQSURFHVVHVRIVWHHOLQFRQFUHWH FI&KDSWHU DVZHOO
DVRXU HYDOXDWLRQRI H[LVWLQJDQGGHVLJQRIQHZ FRXQWHUPHDVXUHV &KDSWHUVDQG DVRXU HYDOXDWLRQRI H[LVWLQJDQGGHVLJQRIQHZ FRXQWHUPHDVXUHV &KDSWHUVDQG
UHVSHFWLYHO\ ,QSDUWLFXODUWKHLQIOXHQFHRIRWKHUVXEVWDQFHVRQWKHUHDFWLRQVFDQEH UHVSHFWLYHO\ ,QSDUWLFXODUWKHLQIOXHQFHRIRWKHUVXEVWDQFHVRQWKHUHDFWLRQVFDQEH
RIPDMRULPSRUWDQFHLQWKHFRPSOH[FKHPLVWU\RIWKHFRQFUHWHHQYLURQPHQW RIPDMRULPSRUWDQFHLQWKHFRPSOH[FKHPLVWU\RIWKHFRQFUHWHHQYLURQPHQW
,QFRQFOXVLRQLWFDQEHVDLGWKDWDOWKRXJKWKHWKHRU\EHKLQGWKH3RXUEDL[GLDJUDPLV ,QFRQFOXVLRQLWFDQEHVDLGWKDWDOWKRXJKWKHWKHRU\EHKLQGWKH3RXUEDL[GLDJUDPLV
UDWKHU VLPSOH LWV HVWDEOLVKPHQW LV FDOFXODWLRQ LQWHQVLYH )XUWKHUPRUH WKH YDOLGLW\ RI UDWKHU VLPSOH LWV HVWDEOLVKPHQW LV FDOFXODWLRQ LQWHQVLYH )XUWKHUPRUH WKH YDOLGLW\ RI
WKHGLDJUDPIRUWKHLQYHVWLJDWHGV\VWHPLVVWURQJO\DIIHFWHGE\WKHSUHVHOHFWLRQRIVSH WKHGLDJUDPIRUWKHLQYHVWLJDWHGV\VWHPLVVWURQJO\DIIHFWHGE\WKHSUHVHOHFWLRQRIVSH
FLHVDQGWKHFKRLFHRILRQDFWLYLW\ZKLFKDUHUDWKHUFRPSOH[DVSHFWV FI&KDSWHU  FLHVDQGWKHFKRLFHRILRQDFWLYLW\ZKLFKDUHUDWKHUFRPSOH[DVSHFWV FI&KDSWHU 
LQ SDUWLFXODU ZLWK UHJDUG WR WKH SK\VLFDO SURSHUWLHV RI FRQFUHWH DQG WKH PXOWLIDFHWHG LQ SDUWLFXODU ZLWK UHJDUG WR WKH SK\VLFDO SURSHUWLHV RI FRQFUHWH DQG WKH PXOWLIDFHWHG
FKHPLVWU\ DQG HOHFWURFKHPLVWU\ RI D FRQFUHWHPHWDO V\VWHP %HVLGHV WKH WKHUPRG\ FKHPLVWU\ DQG HOHFWURFKHPLVWU\ RI D FRQFUHWHPHWDO V\VWHP %HVLGHV WKH WKHUPRG\
QDPLF DVSHFWV WKHVH SDUDPHWHUV DUH ODUJHO\ JRYHUQHG E\ WKH UHDFWLRQ NLQHWLFV RI WKH QDPLF DVSHFWV WKHVH SDUDPHWHUV DUH ODUJHO\ JRYHUQHG E\ WKH UHDFWLRQ NLQHWLFV RI WKH
HOHFWURFKHPLFDOV\VWHPXQGHULQYHVWLJDWLRQ HOHFWURFKHPLFDOV\VWHPXQGHULQYHVWLJDWLRQ
+RZHYHUDVLQGLFDWHGWKURXJKRXWWKLV6HFWLRQUHDFWLRQVNLQHWLFVGRHVQRWRQO\FRQ +RZHYHUDVLQGLFDWHGWKURXJKRXWWKLV6HFWLRQUHDFWLRQVNLQHWLFVGRHVQRWRQO\FRQ
FHUQWKHHVWDEOLVKPHQWDQGLQWHUSUHWDWLRQ RI3RXUEDL[ GLDJUDPV EXW WKHDSSOLFDWLRQ FHUQWKHHVWDEOLVKPHQWDQGLQWHUSUHWDWLRQ RI3RXUEDL[ GLDJUDPV EXW WKHDSSOLFDWLRQ
RIWKHUPRG\QDPLFWKHRU\DQGWRROVLQJHQHUDO 6HOHFWHGWKHRUHWLFDODQG SUDFWLFDODV RIWKHUPRG\QDPLFWKHRU\DQGWRROVLQJHQHUDO 6HOHFWHG WKHRUHWLFDO DQG SUDFWLFDO DV
SHFWVRIUHDFWLRQNLQHWLFVRIDTXHRXVPHWDOOLFFRUURVLRQZKLFKZHFRQVLGHUWREHPRVW SHFWVRIUHDFWLRQNLQHWLFVRIDTXHRXVPHWDOOLFFRUURVLRQZKLFKZHFRQVLGHUWREHPRVW
LPSRUWDQWIRUWKHSXUSRVHRIWKLVWKHVLVDUHGHDOWZLWKLQ6HFWLRQ LPSRUWDQWIRUWKHSXUSRVHRIWKLVWKHVLVDUHGHDOWZLWKLQ6HFWLRQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

 .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ  .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ


,Q 6HFWLRQ  LW ZDV VKRZQ WKDW WKH DSSOLFDWLRQ RI WKHUPRG\QDPLFV LH WKH DVVHVV ,Q 6HFWLRQ  LW ZDV VKRZQ WKDW WKH DSSOLFDWLRQ RI WKHUPRG\QDPLFV LH WKH DVVHVV
PHQWRIWKHµ(¶RUµ¨*¶RIUHDFWLRQVDQGLQSDUWLFXODUWKHLQIRUPDWLRQWKDWFDQEH PHQWRIWKHµ(¶RUµ¨*¶ RI UHDFWLRQV DQG LQSDUWLFXODU WKH LQIRUPDWLRQ WKDWFDQEH
REWDLQHGIURPWKH3RXUEDL[GLDJUDPSURYLGHVDXVHIXOEDVLVIRUSUHGLFWLQJFRQGLWLRQV REWDLQHGIURPWKH3RXUEDL[GLDJUDPSURYLGHVDXVHIXOEDVLVIRUSUHGLFWLQJFRQGLWLRQV
XQGHUZKLFKFHUWDLQUHDFWLRQVDUHOLDEOHWRLQIOXHQFHWKHFRUURVLRQEHKDYLRXURIPHW XQGHUZKLFKFHUWDLQUHDFWLRQVDUHOLDEOHWRLQIOXHQFHWKHFRUURVLRQEHKDYLRXURIPHW
DOV%DVHGRQWKLVLQIRUPDWLRQWKHUHODWLYHWHQGHQFLHVRIWKH PHWDO UHDFWLYLW\ FDQEH DOV%DVHGRQWKLVLQIRUPDWLRQWKHUHODWLYHWHQGHQFLHVRIWKH PHWDO UHDFWLYLW\ FDQEH
DVVHVVHGDQGFRXQWHUPHDVXUHVFDQEHYHULILHGRUGHVLJQHG+RZHYHU DV LQGLFDWHG LQ DVVHVVHG DQG FRXQWHUPHDVXUHV FDQEH YHULILHG RU GHVLJQHG +RZHYHUDVLQGLFDWHGLQ
6HFWLRQLWLVQHFHVVDU\WRUHFRJQLVHWKDWWKLVDSSURDFKKDVFHUWDLQOLPLWDWLRQV 6HFWLRQLWLVQHFHVVDU\WRUHFRJQLVHWKDWWKLVDSSURDFKKDVFHUWDLQOLPLWDWLRQV
,QWKHUPRG\QDPLFVUHGR[FRXSOHVLHWKHFKDUJHEDODQFHGFRPELQDWLRQRIDQRGLFDQG ,QWKHUPRG\QDPLFVUHGR[FRXSOHVLHWKHFKDUJHEDODQFHGFRPELQDWLRQRIDQRGLFDQG
FDWKRGLFUHDFWLRQVDUHFRQVLGHUHGWREHDWHTXLOLEULXP<HWLQSUDFWLFHWKLVLVJHQHU FDWKRGLFUHDFWLRQVDUHFRQVLGHUHGWREHDWHTXLOLEULXP<HWLQSUDFWLFHWKLVLVJHQHU
DOO\QRWWKHFDVH DQGLWLVWKHUHIRUHLPSRVVLEOHWRSUHGLFWZKHWKHUDWKHUPRG\QDPL DOO\QRWWKHFDVH DQGLWLVWKHUHIRUHLPSRVVLEOHWRSUHGLFWZKHWKHUDWKHUPRG\QDPL
FDOO\IDYRXUHGKDOIFHOOUHDFWLRQRFFXUVDWDVLJQLILFDQWUDWH+HQFHDVVHVVPHQWRIWKH FDOO\IDYRXUHGKDOIFHOOUHDFWLRQRFFXUVDWDVLJQLILFDQWUDWH+HQFHDVVHVVPHQWRIWKH
NLQHWLFV RI HOHFWURFKHPLFDO UHDFWLRQV LV LPSRUWDQW LQ DVVHUWLQJ WKH H[WHQW WR ZKLFK D NLQHWLFV RI HOHFWURFKHPLFDO UHDFWLRQV LV LPSRUWDQW LQ DVVHUWLQJ WKH H[WHQW WR ZKLFK D
PHWDOFRUURGHVLHLWVFRUURVLRQUDWH PHWDOFRUURGHVLHLWVFRUURVLRQUDWH
6R LQ WKH SUHVHQW WKHVLV IRFXV LV VHW RQ WKHUPRG\QDPLF SULQFLSOHV %XW LW VKRXOG EH 6R LQ WKH SUHVHQW WKHVLV IRFXV LV VHW RQ WKHUPRG\QDPLF SULQFLSOHV %XW LW VKRXOG EH
NHSWLQPLQGWKDWLWLVFUXFLDOWRWDNHNLQHWLFVLQWRGXHDFFRXQWLQGHVFULELQJFRUURVLRQ NHSWLQPLQGWKDWLWLVFUXFLDOWRWDNHNLQHWLFVLQWRGXHDFFRXQWLQGHVFULELQJFRUURVLRQ
PHFKDQLVPV FI&KDSWHU DVZHOODVLQWKHHYDOXDWLRQRIH[LVWLQJ FI&KDSWHU DQG PHFKDQLVPV FI&KDSWHU DVZHOODVLQWKHHYDOXDWLRQRIH[LVWLQJ FI&KDSWHU DQG
WKH GHVLJQ RI QHZ FRXQWHUPHDVXUHV FI &KDSWHU   0RUHRYHU WKH NLQHWLFV WKHRU\ WKH GHVLJQ RI QHZ FRXQWHUPHDVXUHV FI &KDSWHU   0RUHRYHU WKH NLQHWLFV WKHRU\
GHDOWZLWKLQWKLV6HFWLRQHVWDEOLVKHVWKHEDVLVIRUVRPHRIWKHHOHFWURFKHPLFDOPHDV GHDOWZLWKLQWKLV6HFWLRQHVWDEOLVKHVWKHEDVLVIRUVRPHRIWKHHOHFWURFKHPLFDOPHDV
XUHPHQW WHFKQLTXHV XVHG LQ WKH H[SHULPHQWDO SDUW RI WKLV SURMHFW FI 6HFWLRQV  XUHPHQW WHFKQLTXHV XVHG LQ WKH H[SHULPHQWDO SDUW RI WKLV SURMHFW FI 6HFWLRQV 
DQG  DQG 

 (OHFWULFDO'RXEOH/D\HU  (OHFWULFDO'RXEOH/D\HU


7KHVRFDOOHGHOHFWULFDOGRXEOHOD\HULVDQHVVHQWLDOFRQFHSWLQFRUURVLRQNLQHWLFV7KLV 7KHVRFDOOHGHOHFWULFDOGRXEOHOD\HULVDQHVVHQWLDOFRQFHSWLQFRUURVLRQNLQHWLFV7KLV
OD\HULVIRUPHGE\HDFKFRQGXFWLQJPHWDOLQFRQWDFWZLWKDQDTXHRXVVROXWLRQ)RUGH OD\HULVIRUPHGE\HDFKFRQGXFWLQJPHWDOLQFRQWDFWZLWKDQDTXHRXVVROXWLRQ)RUGH
WDLOHG GHVFULSWLRQ RI WKLV FRPSOH[ LQWHUIDFH UHIHUHQFH LV PDGH WR WKH OLWHUDWXUH HJ WDLOHG GHVFULSWLRQ RI WKLV FRPSOH[ LQWHUIDFH UHIHUHQFH LV PDGH WR WKH OLWHUDWXUH HJ
>)UHLHVOHEHQ+DQVHQ-RQHV&DOOLVWHU &DOOLVWHU@,QVLPSOHWHUPV >)UHLHVOHEHQ+DQVHQ-RQHV&DOOLVWHU &DOOLVWHU@,QVLPSOHWHUPV
WKHPRVWLPSRUWDQWIHDWXUHVRIWKHGRXEOHOD\HUFDQEHGHVFULEHGDVIROORZV7KHFRQ WKHPRVWLPSRUWDQWIHDWXUHVRIWKHGRXEOHOD\HUFDQEHGHVFULEHGDVIROORZV7KHFRQ
GXFWLYH PHWDO VXUIDFH DWWUDFWV XQV\PPHWULFDO SRODU ZDWHU PROHFXOHV ZKLFK IRUP DQ GXFWLYH PHWDO VXUIDFH DWWUDFWV XQV\PPHWULFDO SRODU ZDWHU PROHFXOHV ZKLFK IRUP DQ
RULHQWHGVROYHQWOD\HU7KLVOD\HUSUHYHQWVFORVHDSSURDFKRILRQVIURPWKHEXONVROX RULHQWHGVROYHQWOD\HU7KLVOD\HUSUHYHQWVFORVHDSSURDFKRILRQVIURPWKHEXONVROX
WLRQ &KDUJHG LRQV LQ WKH EXON VROXWLRQ DOVR DWWUDFW WKHLU RZQ VKHDWK RI SRODU ZDWHU WLRQ &KDUJHG LRQV LQ WKH EXON VROXWLRQ DOVR DWWUDFW WKHLU RZQ VKHDWK RI SRODU ZDWHU
VROYHQWPROHFXOHVZKLFKIXUWKHULQVXODWHWKHPIURPWKHPHWDOVXUIDFH7KHSODQHRI VROYHQWPROHFXOHVZKLFKIXUWKHULQVXODWHWKHPIURPWKHPHWDOVXUIDFH7KHSODQHRI
FORVHVWDSSURDFKRISRVLWLYHO\FKDUJHGFDWLRQVWRWKHQHJDWLYHO\FKDUJHGPHWDOVXUIDFH FORVHVWDSSURDFKRISRVLWLYHO\FKDUJHGFDWLRQVWRWKHQHJDWLYHO\FKDUJHGPHWDOVXUIDFH
LVJHQHUDOO\UHIHUUHGWRDVWKHRXWHU+HOPKROW] SODQH7KHUHVXOWLVDQLQWHUIDFHZLWK LVJHQHUDOO\UHIHUUHGWRDVWKHRXWHU+HOPKROW] SODQH7KHUHVXOWLVDQLQWHUIDFHZLWK
VHSDUDWHGQHJDWLYHDQGSRVLWLYHFKDUJHZKLFKLVFRPPRQO\UHIHUUHGWRDVWKHHOHFWUL VHSDUDWHGQHJDWLYHDQGSRVLWLYHFKDUJHZKLFKLVFRPPRQO\UHIHUUHGWRDVWKHHOHFWUL
FDOGRXEOHOD\HU7KHHOHFWULFDOGRXEOHOD\HULVJHQHUDOO\FRQVLGHUHGWREHKDYHOLNHD FDOGRXEOHOD\HU7KHHOHFWULFDOGRXEOHOD\HULVJHQHUDOO\FRQVLGHUHGWREHKDYHOLNHD
FKDUJHG FDSDFLWRU 7KH HOHFWULFDO ILHOG FUHDWHG E\ WKH GRXEOH OD\HU SUHYHQWV HDV\ FKDUJHG FDSDFLWRU 7KH HOHFWULFDO ILHOG FUHDWHG E\ WKH GRXEOH OD\HU SUHYHQWV HDV\
FKDUJHWUDQVIHUZKLFKWKHUHE\OLPLWVHOHFWURFKHPLFDOUHDFWLRQVRQWKHPHWDOVXUIDFH FKDUJHWUDQVIHUZKLFKWKHUHE\OLPLWVHOHFWURFKHPLFDOUHDFWLRQVRQWKHPHWDOVXUIDFH

 

1DPHGDIWHU+HUPDQQ/XGZLJ)HUGLQDQGYRQ+HOPKROW]*HUPDQ\>5REHUJH@ 1DPHGDIWHU+HUPDQQ/XGZLJ)HUGLQDQGYRQ+HOPKROW]*HUPDQ\>5REHUJH@

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


.LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

>-RQHV @ $ XVHIXO HOHFWURFKHPLFDO PHDVXULQJ WHFKQLTXH SURYLGLQJ LQIRUPDWLRQ >-RQHV @ $ XVHIXO HOHFWURFKHPLFDO PHDVXULQJ WHFKQLTXH SURYLGLQJ LQIRUPDWLRQ
RQWKHJRYHUQLQJSDUDPHWHUVRIWKHHOHFWULFDOGRXEOHOD\HULVµ(,6¶ FI6HFWLRQ  RQWKHJRYHUQLQJSDUDPHWHUVRIWKHHOHFWULFDOGRXEOHOD\HULVµ(,6¶ FI6HFWLRQ 
ZKLFK SOD\HG D FHQWUDO UROH LQ RXU H[SHULPHQWDO LQYHVWLJDWLRQV FI 6HFWLRQV  ZKLFK SOD\HG D FHQWUDO UROH LQ RXU H[SHULPHQWDO LQYHVWLJDWLRQV FI 6HFWLRQV 
DQG  DQG 

 ([FKDQJH&XUUHQW'HQVLW\  ([FKDQJH&XUUHQW'HQVLW\


)RUDKDOIFHOOUHDFWLRQDWLWVHTXLOLEULXPSRWHQWLDOµ(¶LHDUHYHUVLEOHFHOOUHGXFWLRQ )RUDKDOIFHOOUHDFWLRQDWLWVHTXLOLEULXPSRWHQWLDOµ(¶LHDUHYHUVLEOHFHOOUHGXFWLRQ
DQGR[LGDWLRQUHDFWLRQVRFFXUDWWKHVDPHUDWH FI6HFWLRQ 7KHUHDFWLRQUDWHLQ DQGR[LGDWLRQUHDFWLRQVRFFXUDWWKHVDPHUDWH FI6HFWLRQ 7KHUHDFWLRQUDWHLQ
HDFKGLUHFWLRQFDQDOVREHH[SUHVVHGE\WKHWUDQVSRUWDWLRQUDWHRIHOHFWULFFKDUJHVLH HDFKGLUHFWLRQFDQDOVREHH[SUHVVHGE\WKHWUDQVSRUWDWLRQUDWHRIHOHFWULFFKDUJHVLH
E\WKHH[FKDQJHFXUUHQWµ,¶RUE\WKHH[FKDQJHFXUUHQWGHQVLW\µL¶7KHQHWUHDFWLRQ E\WKHH[FKDQJHFXUUHQWµ,¶RUE\WKHH[FKDQJHFXUUHQWGHQVLW\µL¶7KHQHWUHDFWLRQ
UDWHDQGWKHQHWFXUUHQWGHQVLW\DUH]HUR7KHPDJQLWXGHRIWKHH[FKDQJHFXUUHQWGHQ UDWHDQGWKHQHWFXUUHQWGHQVLW\DUH]HUR7KHPDJQLWXGHRIWKHH[FKDQJHFXUUHQWGHQ
VLW\µL¶GHSHQGVRQWKHW\SHRIKDOIFHOOUHDFWLRQWKHHOHFWURGHPDWHULDODQGWKHHOHF VLW\µL¶GHSHQGVRQWKHW\SHRIKDOIFHOOUHDFWLRQWKHHOHFWURGHPDWHULDODQGWKHHOHF
WURO\WH DQG DOVR VLJQLILFDQWO\ RQ WKH WHPSHUDWXUH DQG FRQFHQWUDWLRQV 7KH H[FKDQJH WURO\WH DQG DOVR VLJQLILFDQWO\ RQ WKH WHPSHUDWXUH DQG FRQFHQWUDWLRQV 7KH H[FKDQJH
FXUUHQW GHQVLW\ KDV D VWURQJ LQIOXHQFH RQ DFWXDO FRUURVLRQ UDWHV DQG LV WKHUHIRUH DQ FXUUHQW GHQVLW\ KDV D VWURQJ LQIOXHQFH RQ DFWXDO FRUURVLRQ UDWHV DQG LV WKHUHIRUH DQ
LPSRUWDQWSDUDPHWHULQFRUURVLRQNLQHWLFV LPSRUWDQWSDUDPHWHULQFRUURVLRQNLQHWLFV
'DWDIRUFHUWDLQKDOIFHOOUHDFWLRQVLQVHOHFWHGHOHFWURO\WHVZLWKFHUWDLQFRQFHQWUDWLRQV 'DWDIRUFHUWDLQKDOIFHOOUHDFWLRQVLQVHOHFWHGHOHFWURO\WHVZLWKFHUWDLQFRQFHQWUDWLRQV
LVSURYLGHG LQ WKH OLWHUDWXUHHJ>-RQHV%DUGDO@0RVWGDWDLVDYDLODEOH LVSURYLGHG LQ WKH OLWHUDWXUHHJ>-RQHV%DUGDO@0RVWGDWDLVDYDLODEOH
EDVHGRQK\GURJHQLRQUHGXFWLRQDVFDWKRGLFUHDFWLRQ EDVHGRQK\GURJHQLRQUHGXFWLRQDVFDWKRGLFUHDFWLRQ

+ + + H− → +  (( 
 =  P96+( )  >@ + + + H− → +  (( 
 =  P96+( )  >@

IRUPHWDOVLQDFLGHOHFWURO\WHVHJWKHµL¶IRUWKHUHGXFWLRQRIIHUURXVLRQ IRUPHWDOVLQDFLGHOHFWURO\WHVHJWKHµL¶IRUWKHUHGXFWLRQRIIHUURXVLRQ

)H + + H− → )H (( 
 −  {−} P96+( )  >@ )H + + H− → )H (( 
 −  {−} P96+( )  >@

LQ 1 K\GURFKORULF DFLG LV HJ JLYHQ WR í$FP >%DUGDO @ RU í$FP LQ 1 K\GURFKORULF DFLG LV HJ JLYHQ WR í$FP >%DUGDO @ RU í$FP
>-RQHV@ZKHUHDVWKHµL¶IRUWKHUHGXFWLRQRI]LQFLRQ >-RQHV@ZKHUHDVWKHµL¶IRUWKHUHGXFWLRQRI]LQFLRQ

=Q  + + H − → =Q (( 
 = −  {−} P96+( )  >@ =Q  + + H − → =Q (( 
 = −  {−} P96+( )  >@

LQ1VXOSKXULFDFLG +62 ZDVGHWHUPLQHGWREHPXFKORZHUWR×í$FP LQ1VXOSKXULFDFLG +62 ZDVGHWHUPLQHGWREHPXFKORZHUWR×í$FP


>%DUGDO@RU×í$FP>-RQHV@ >%DUGDO@RU×í$FP>-RQHV@
7KHDERYHH[DPSOHLQGLFDWHVWKHLPSRUWDQFHRIWKHH[FKDQJHFXUUHQWGHQVLW\DQGDF 7KHDERYHH[DPSOHLQGLFDWHVWKHLPSRUWDQFHRIWKHH[FKDQJHFXUUHQWGHQVLW\DQGDF
FRUGLQJO\NLQHWLFVLQWKHDVVHVVPHQWRIFRUURVLRQ%DVHGRQWKHPDJQLWXGHRIµ(¶LH FRUGLQJO\NLQHWLFVLQWKHDVVHVVPHQWRIFRUURVLRQ%DVHGRQWKHPDJQLWXGHRIµ(¶LH
WKHDELOLW\WREHUHGXFHG]LQFFRXOGEHH[SHFWHGWRKDYHDKLJKHUFRUURVLRQUDWHWKDQ WKHDELOLW\WREHUHGXFHG]LQFFRXOGEHH[SHFWHGWRKDYHDKLJKHUFRUURVLRQUDWHWKDQ
LURQ FI6HFWLRQ EXWWKHORZHUH[FKDQJHFXUUHQWGHQVLW\VKRZVWKDWWKHFRUUR LURQ FI6HFWLRQ EXWWKHORZHUH[FKDQJHFXUUHQWGHQVLW\VKRZVWKDWWKHFRUUR
VLRQUDWHLVPXFKORZHUWKDQWKHRQHRILURQ VLRQUDWHLVPXFKORZHUWKDQWKHRQHRILURQ
7KHGLIIHUHQFHRIFRUURVLRQUDWHVGXHWRWKHGLIIHUHQWPDJQLWXGHVLQWKHFXUUHQWGHQVL 7KHGLIIHUHQFHRIFRUURVLRQUDWHVGXHWRWKHGLIIHUHQWPDJQLWXGHVLQWKHFXUUHQWGHQVL
WLHVHVSHFLDOO\ RILURQDQG]LQFDUHRIPDMRU UHOHYDQFHWRWKHGLVFXVVLRQRIH[LVWLQJ WLHVHVSHFLDOO\ RILURQDQG]LQFDUHRIPDMRU UHOHYDQFHWRWKHGLVFXVVLRQRIH[LVWLQJ
FI&KDSWHU DQGWKH GHYHORSPHQWRIQHZFRXQWHUPHDVXUHV FI&KDSWHU 0RUH FI&KDSWHU DQGWKH GHYHORSPHQWRIQHZFRXQWHUPHDVXUHV FI&KDSWHU 0RUH
RYHU WKH H[FKDQJH FXUUHQW GHQVLW\ DOVRSOD\HG D VLJQLILFDQW UROHLQWKHH[SHULPHQWDO RYHU WKH H[FKDQJH FXUUHQW GHQVLW\ DOVRSOD\HG D VLJQLILFDQW UROHLQWKHH[SHULPHQWDO
SDUWRIWKHSURMHFWHJZLWKUHJDUGWRWKHFKRLFHRIPDWHULDOIRUH[WHUQDODQGHPEHG SDUWRIWKHSURMHFWHJZLWKUHJDUGWRWKHFKRLFHRIPDWHULDOIRUH[WHUQDODQGHPEHG

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

GDEOH HOHFWURGHV )RU LQVWDQFH WKH VHOHFWLRQ RI 5X7L DFWLYDWHG WLWDQLXP FI 6HFWLRQ GDEOH HOHFWURGHV )RU LQVWDQFH WKH VHOHFWLRQ RI 5X7L DFWLYDWHG WLWDQLXP FI 6HFWLRQ
 DVEDVHPDWHULDOIRUGLIIHUHQWHOHFWURGHW\SHVLQWKHH[SHULPHQWDOLQYHVWLJDWLRQV  DVEDVHPDWHULDOIRUGLIIHUHQWHOHFWURGHW\SHVLQWKHH[SHULPHQWDOLQYHVWLJDWLRQV
LQWKLVSURMHFWZDVSULPDULO\EDVHGRQLWVSURYLVLRQIRUKLJKH[FKDQJHFXUUHQWVGHQVLW\ LQWKLVSURMHFWZDVSULPDULO\EDVHGRQLWVSURYLVLRQIRUKLJKH[FKDQJHFXUUHQWVGHQVLW\
ZKLOHEHLQJUHODWLYHO\XQUHDFWLYHLWVHOI ZKLOHEHLQJUHODWLYHO\XQUHDFWLYHLWVHOI
7KXVZHXQGHUVWDQGWKHH[FKDQJHFXUUHQWGHQVLW\µL¶DVWKHIXQGDPHQWDO NLQHWLFSD 7KXVZHXQGHUVWDQGWKHH[FKDQJHFXUUHQWGHQVLW\µL¶DVWKHIXQGDPHQWDO NLQHWLFSD
UDPHWHU FRUUHVSRQGLQJWRµ(¶DQGµ¨*¶DVWKHIXQGDPHQWDO WKHUPRG\QDPLFSDUDPH UDPHWHU FRUUHVSRQGLQJ WR µ(¶DQGµ¨*¶DVWKHIXQGDPHQWDO WKHUPRG\QDPLFSDUDPH
WHUV WHUV

 &RUURVLRQ3RWHQWLDO3RODULVDWLRQDQG2YHUSRWHQWLDO  &RUURVLRQ3RWHQWLDO3RODULVDWLRQDQG2YHUSRWHQWLDO


,Q SUDFWLFH KDOIFHOO UHDFWLRQV DUH JHQHUDOO\ QRW DW HTXLOLEULXP DQG SURFHHG RQO\ DW ,Q SUDFWLFH KDOIFHOO UHDFWLRQV DUH JHQHUDOO\ QRW DW HTXLOLEULXP DQG SURFHHG RQO\ DW
ILQLWHUDWHVZKLFKLVDPRQJRWKHUVGXHWRWKHIRUPDWLRQRIWKHHOHFWULFDOGRXEOHOD\HU ILQLWHUDWHVZKLFKLVDPRQJRWKHUVGXHWRWKHIRUPDWLRQRIWKHHOHFWULFDOGRXEOHOD\HU
RXWOLQHG LQ 6HFWLRQ  )RU D UHGR[ UHDFWLRQ WR RFFXU DOO LQYROYHG DQRGLF DQG FD RXWOLQHG LQ 6HFWLRQ  )RU D UHGR[ UHDFWLRQ WR RFFXU DOO LQYROYHG DQRGLF DQG FD
WKRGLFUHDFWLRQVDUHPRYHGDZD\ IURP WKHLU HTXLOLEULXPSRWHQWLDO µ(¶DVDUHVXOWRI WKRGLFUHDFWLRQVDUHPRYHGDZD\IURPWKHLU HTXLOLEULXPSRWHQWLDO µ(¶DVDUHVXOWRI
WKHQHWHOHFWURGHUHDFWLRQRFFXUULQJLHDQHWHOHFWULFFXUUHQWIORZLQJWKURXJKWKHLQ WKHQHWHOHFWURGHUHDFWLRQRFFXUULQJLHDQHWHOHFWULFFXUUHQWIORZLQJWKURXJKWKHLQ
WHUIDFHEHWZHHQWKHPHWDODQGWKHHOHFWURO\WH7KXVZKHQ³FRUURVLRQ´WDNHVSODFHRQD WHUIDFHEHWZHHQWKHPHWDODQGWKHHOHFWURO\WH7KXVZKHQ³FRUURVLRQ´WDNHVSODFHRQD
PHWDOVXUIDFH WKHDFWXDOSRWHQWLDODGDSWVWRDYDOXHVRPHZKHUHEHWZHHQWKHHTXLOLE PHWDOVXUIDFH WKHDFWXDOSRWHQWLDODGDSWVWRDYDOXHVRPHZKHUHEHWZHHQWKHHTXLOLE
ULXPSRWHQWLDORIWKHFDWKRGLFDQGDQRGLFUHDFWLRQVLHDPL[HGSRWHQWLDO7KDWZD\ ULXPSRWHQWLDORIWKHFDWKRGLFDQGDQRGLFUHDFWLRQVLHDPL[HGSRWHQWLDO7KDWZD\
WKHVRFDOOHGFRUURVLRQSRWHQWLDOµ(FRUU¶ LVHVWDEOLVKHG WKHVRFDOOHGFRUURVLRQSRWHQWLDOµ(FRUU¶ LVHVWDEOLVKHG
7KHGHYLDWLRQIURPµ(¶LVFDOOHGSRODULVDWLRQDQGWKHHOHFWURGHLVUHIHUUHGWRDVSRODU 7KHGHYLDWLRQIURPµ(¶LVFDOOHGSRODULVDWLRQDQGWKHHOHFWURGHLVUHIHUUHGWRDVSRODU
LVHG$PHDVXUHRISRODULVDWLRQLVWKHRYHUSRWHQWLDOLHWKHGLIIHUHQFHEHWZHHQµ(FRUU¶ LVHG$PHDVXUHRISRODULVDWLRQLVWKHRYHUSRWHQWLDOLHWKHGLIIHUHQFHEHWZHHQµ(FRUU¶
DQGWKHHTXLOLEULXPSRWHQWLDOVRIWKHLQYROYHGKDOIFHOOUHDFWLRQV DQGWKHHTXLOLEULXPSRWHQWLDOVRIWKHLQYROYHGKDOIFHOOUHDFWLRQV
:LWKµ(D¶DVWKHHTXLOLEULXPSRWHQWLDOIRUWKHDQRGLFUHDFWLRQDQGµ(F¶DVWKHHTXL :LWKµ(D¶DVWKHHTXLOLEULXPSRWHQWLDOIRUWKHDQRGLFUHDFWLRQDQGµ(F¶DVWKHHTXL
OLEULXP SRWHQWLDO RI WKH FDWKRGLF UHDFWLRQ WKH DQRGLF RYHUSRWHQWLDO µȘD¶ DQG WKH FD OLEULXP SRWHQWLDO RI WKH FDWKRGLF UHDFWLRQ WKH DQRGLF RYHUSRWHQWLDO µȘD¶ DQG WKH FD
WKRGLFµȘF¶FDQEHH[SUHVVHGDV‚ WKRGLFµȘF¶FDQEHH[SUHVVHGDV‚
ηD = ( FRUU − (  D >   >@ ηD = ( FRUU − (  D >   >@

ηF = ( FRUU − (  F <   >@ ηF = ( FRUU − (  F <   >@

>-RQHV%DUGDO@ >-RQHV%DUGDO@
7KHWHQGHQF\IRUFRUURVLRQLQFUHDVHVZLWKWKHPDJQLWXGHRIDQRGLFSRODULVDWLRQ7KXV 7KHWHQGHQF\IRUFRUURVLRQLQFUHDVHVZLWKWKHPDJQLWXGHRIDQRGLFSRODULVDWLRQ7KXV
DQRGLF SRODULVDWLRQ UHSUHVHQWV D GULYLQJ IRUFH IRU FRUURVLRQ E\ WKH DQRGLF UHDFWLRQ DQRGLF SRODULVDWLRQ UHSUHVHQWV D GULYLQJ IRUFH IRU FRUURVLRQ E\ WKH DQRGLF UHDFWLRQ
7KDWPHDQVLIWKHSRWHQWLDORQWKHPHWDOVXUIDFHULVHVWKHR[LGLVLQJSRZHUDQGKHQFH 7KDWPHDQVLIWKHSRWHQWLDORQWKHPHWDOVXUIDFHULVHVWKHR[LGLVLQJSRZHUDQGKHQFH

 

µ(FRUU¶LVLQWKHOLWHUDWXUHDOVRUHIHUUHGWRDVUHVWSRWHQWLDOIUHHFRUURVLRQSRWHQWLDODQGRSHQFLUFXLW µ(FRUU¶LVLQWKHOLWHUDWXUHDOVRUHIHUUHGWRDVUHVWSRWHQWLDOIUHHFRUURVLRQSRWHQWLDODQGRSHQFLUFXLW
SRWHQWLDO µ2&3¶ ,QUHODWLRQWRHJSRWHQWLDOPDSSLQJ>$670&@µ(FRUU¶LVDOVRUHIHUUHGWR SRWHQWLDO µ2&3¶ ,QUHODWLRQWRHJSRWHQWLDOPDSSLQJ>$670&@µ(FRUU¶LVDOVRUHIHUUHGWR
DVKDOIFHOOSRWHQWLDOZKLFKZHFRQVLGHUWREHSDUWLFXODUO\PLVOHDGLQJ7KHUHIRUHWKHWHUPFRUURVLRQ DVKDOIFHOOSRWHQWLDOZKLFKZHFRQVLGHUWREHSDUWLFXODUO\PLVOHDGLQJ7KHUHIRUHWKHWHUPFRUURVLRQ
SRWHQWLDOLVXVHGWKURXJKRXWWKLVWKHVLVDOVRZKHQUHIHUULQJWRSRWHQWLDOVLQFRQFUHWHZKLFKPLJKWDS SRWHQWLDOLVXVHGWKURXJKRXWWKLVWKHVLVDOVRZKHQUHIHUULQJWRSRWHQWLDOVLQFRQFUHWHZKLFKPLJKWDS
SHDUXQXVXDO FI&KDSWHUµ7D'¶  SHDUXQXVXDO FI&KDSWHUµ7D'¶ 
‚ ‚
,QWKHOLWHUDWXUHWKHV\PEROµȘ¶LVXVHGIRUERWKSRODULVDWLRQDQGRYHUSRWHQWLDO RYHUYROWDJH ,QWKLV ,QWKHOLWHUDWXUHWKHV\PEROµȘ¶LVXVHGIRUERWKSRODULVDWLRQDQGRYHUSRWHQWLDO RYHUYROWDJH ,QWKLV
WKHVLVµȘ¶LVRQO\XVHGIRURYHUSRWHQWLDOVZKLFKLVFRQVLGHUHGWREHWKHPHDVXUHDEOHUHVXOWRISRODUL WKHVLVµȘ¶LVRQO\XVHGIRURYHUSRWHQWLDOVZKLFKLVFRQVLGHUHGWREHWKHPHDVXUHDEOHUHVXOWRISRODUL
VDWLRQ VDWLRQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


.LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

WKHFRUURVLRQUDWHRIWKHVROXWLRQLQFUHDVHVEHFDXVHWKHDQRGLFSRODULVDWLRQLVODUJHU WKHFRUURVLRQUDWHRIWKHVROXWLRQLQFUHDVHVEHFDXVHWKHDQRGLFSRODULVDWLRQLVODUJHU
$PRQJRWKHUVWKLVHIIHFWFDQEHLQYHVWLJDWHGE\VRFDOOHGSRODULVDWLRQFXUYHVZKLFK $PRQJRWKHUVWKLVHIIHFWFDQEHLQYHVWLJDWHGE\VRFDOOHGSRODULVDWLRQFXUYHVZKLFK
SURYLGH YDULRXV GHWDLOV RQ WKH UHDFWLRQ NLQHWLFV RI D FRUURGLQJ V\VWHP FI 6HFWLRQ SURYLGH YDULRXV GHWDLOV RQ WKH UHDFWLRQ NLQHWLFV RI D FRUURGLQJ V\VWHP FI 6HFWLRQ
   
7KHWKHRUHWLFDOEDVLVWRWKHVHLPSRUWDQWSDUDPHWHUVWKHVRFDOOHGPL[HGSRWHQWLDOWKH 7KHWKHRUHWLFDOEDVLVWRWKHVHLPSRUWDQWSDUDPHWHUVWKHVRFDOOHGPL[HGSRWHQWLDOWKH
RU\ZDVHVWDEOLVKHGLQE\:DJQHU DQG7UDXGLQWKHLUIXQGDPHQWDOSDSHU³hEHU RU\ZDVHVWDEOLVKHGLQE\:DJQHU DQG7UDXGLQWKHLUIXQGDPHQWDOSDSHU³hEHU
GLH 'HXWXQJ YRQ .RUURVLRQVYRUJlQJHQ GXUFK hEHUODJHUXQJ YRQ (OHNWURFKHPLVFKHQ GLH 'HXWXQJ YRQ .RUURVLRQVYRUJlQJHQ GXUFK hEHUODJHUXQJ YRQ (OHNWURFKHPLVFKHQ
7HLOYRUJlQJHQXQGEHUGLH3RWHQWLDOOELOGXQJDQ0LVFKHOHNWURGHQ´ ³2QWKH,QWHUSUH 7HLOYRUJlQJHQXQGEHUGLH3RWHQWLDOOELOGXQJDQ0LVFKHOHNWURGHQ´ ³2QWKH,QWHUSUH
WDWLRQ RI &RUURVLRQ 3URFHVVHV WKURXJK WKH 6XSHUSRVLWLRQ RI (OHFWURFKHPLFDO 3DUWLDO WDWLRQ RI &RUURVLRQ 3URFHVVHV WKURXJK WKH 6XSHUSRVLWLRQ RI (OHFWURFKHPLFDO 3DUWLDO
3URFHVVHVDQGRQWKH3RWHQWLDORI0L[HG(OHFWURGHV´ >:DJQHU 7UDXG@ 3URFHVVHVDQGRQWKH3RWHQWLDORI0L[HG(OHFWURGHV´ >:DJQHU 7UDXG@

 7\SHVRI3RODULVDWLRQDQG2YHUSRWHQWLDO  7\SHVRI3RODULVDWLRQDQG2YHUSRWHQWLDO


:KHQWKHKDOIFHOOUHDFWLRQVDUHPRYHGDZD\IURPWKHLUHTXLOLEULXPDQHWFXUUHQWLV :KHQWKHKDOIFHOOUHDFWLRQVDUHPRYHGDZD\IURPWKHLUHTXLOLEULXPDQHWFXUUHQWLV
REWDLQHGLQHLWKHURQHRUWKHRWKHUGLUHFWLRQ$FHUWDLQUHVLVWDQFHDOZD\V FRXQWHUDFWV REWDLQHGLQHLWKHURQHRUWKHRWKHUGLUHFWLRQ$FHUWDLQUHVLVWDQFHDOZD\VFRXQWHUDFWV
WKDWFXUUHQWIORZDFURVVWKHHOHFWURGHLQWHUIDFHDQGDQRYHUSRWHQWLDORIDFHUWDLQPDJ WKDWFXUUHQWIORZDFURVVWKHHOHFWURGHLQWHUIDFHDQGDQRYHUSRWHQWLDORIDFHUWDLQPDJ
QLWXGH LV UHTXLUHG WR RYHUFRPH WKLV UHVLVWDQFH 'HSHQGLQJ RQ WKH W\SH RI UHVLVWDQFH QLWXGH LV UHTXLUHG WR RYHUFRPH WKLV UHVLVWDQFH 'HSHQGLQJ RQ WKH W\SH RI UHVLVWDQFH
ZKLFK OLPLWV WKH UHDFWLRQ UDWH WKUHH GLIIHUHQW W\SHV RI SRODULVDWLRQ FDQ EH GLVWLQ ZKLFK OLPLWV WKH UHDFWLRQ UDWH WKUHH GLIIHUHQW W\SHV RI SRODULVDWLRQ FDQ EH GLVWLQ
JXLVKHG JXLVKHG
‡ $FWLYDWLRQSRODULVDWLRQ FI6HFWLRQ  ‡ $FWLYDWLRQSRODULVDWLRQ FI6HFWLRQ 
‡ &RQFHQWUDWLRQSRODULVDWLRQ FI6HFWLRQ  ‡ &RQFHQWUDWLRQSRODULVDWLRQ FI6HFWLRQ 
‡ 5HVLVWDQFHSRODULVDWLRQ FI6HFWLRQ  ‡ 5HVLVWDQFHSRODULVDWLRQ FI6HFWLRQ 

 $FWLYDWLRQ3RODULVDWLRQDQG2YHUSRWHQWLDO  $FWLYDWLRQ3RODULVDWLRQDQG2YHUSRWHQWLDO


,Q SULQFLSOH DFWLYDWLRQ SRODULVDWLRQ UHVXOWLQJ LQ DQ DFWLYDWLRQ RYHUSRWHQWLDO µȘDFW¶ LV ,Q SULQFLSOH DFWLYDWLRQ SRODULVDWLRQ UHVXOWLQJ LQ DQ DFWLYDWLRQ RYHUSRWHQWLDO µȘDFW¶ LV
FDXVHG E\ WKH HQHUJ\ EDUULHU OLPLWLQJ WKH HOHFWURFKHPLFDO UHDFWLRQ DW WKH PHWDO FDXVHG E\ WKH HQHUJ\ EDUULHU OLPLWLQJ WKH HOHFWURFKHPLFDO UHDFWLRQ DW WKH PHWDO
HOHFWURO\WH LQWHUIDFH 7KLV LV SDUWO\ GXH WR WKH HOHFWULFDO ILHOG FUHDWHG E\ WKH GRXEOH HOHFWURO\WH LQWHUIDFH 7KLV LV SDUWO\ GXH WR WKH HOHFWULFDO ILHOG FUHDWHG E\ WKH GRXEOH
OD\HU WKDW SUHYHQWV HDV\ FKDUJH WUDQVIHU FI 6HFWLRQ   EXW WKH UDWH GHWHUPLQLQJ OD\HU WKDW SUHYHQWV HDV\ FKDUJH WUDQVIHU FI 6HFWLRQ   EXW WKH UDWH GHWHUPLQLQJ
VWHSODUJHO\GHSHQGVRQWKHFRQYHUVLRQRIVSHFLHVLQYROYHGLQWKHHOHFWURFKHPLFDOUH VWHSODUJHO\GHSHQGVRQWKHFRQYHUVLRQRIVSHFLHVLQYROYHGLQWKHHOHFWURFKHPLFDOUH
DFWLRQ DFWLRQ
)RU LQVWDQFH LQ WHUPV RI K\GURJHQ LRQ UHGXFWLRQ DV FDWKRGLF UHDFWLRQ FI 6HFWLRQ )RU LQVWDQFH LQ WHUPV RI K\GURJHQ LRQ UHGXFWLRQ DV FDWKRGLF UHDFWLRQ FI 6HFWLRQ
   

+ + + H− → +  (( 
 =  P96+( )  >@ + + + H− → +  (( 
 =  P96+( )  >@

WKHWUDQVIRUPDWLRQRFFXUVLQWKUHHPDMRUVWHSV)LUVW+UHDFWVZLWKDQHOHFWURQIURP WKHWUDQVIRUPDWLRQRFFXUVLQWKUHHPDMRUVWHSV)LUVW+UHDFWVZLWKDQHOHFWURQIURP
WKHPHWDO WKHPHWDO

+ + + H − → + DGV  >@ + + + H − → + DGV  >@

 

 &DUO:DJQHU*HUPDQ\>:LNLPHGLD@  &DUO:DJQHU*HUPDQ\>:LNLPHGLD@

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

WRIRUPDQDGVRUEHGK\GURJHQDWRPµ+DGV¶DWWKHVXUIDFH ,QWKHVHFRQGVWHSWZRRI WRIRUPDQDGVRUEHGK\GURJHQDWRPµ+DGV¶DWWKHVXUIDFH ,QWKHVHFRQGVWHSWZRRI


WKHVHDGVRUEHGDWRPVPXVWUHDFWWRIRUPDK\GURJHQPROHFXOH WKHVHDGVRUEHGDWRPVPXVWUHDFWWRIRUPDK\GURJHQPROHFXOH
+ DGV + + DGV → +   >@ + DGV + + DGV → +   >@

DQGWKHWKLUGVWHSUHTXLUHVVXIILFLHQWPROHFXOHVWRFRPELQHDQGQXFOHDWH DK\GURJHQ DQGWKHWKLUGVWHSUHTXLUHVVXIILFLHQWPROHFXOHVWRFRPELQHDQGQXFOHDWH DK\GURJHQ


EXEEOHDWWKHPHWDOVXUIDFH$Q\RQHRIWKHVHWKUHHVWHSVFRQWUROVWKHUDWH>@DQG EXEEOHDWWKHPHWDOVXUIDFH$Q\RQHRIWKHVHWKUHHVWHSVFRQWUROVWKHUDWH>@DQG
WKXVFRQWULEXWHVWRDFWLYDWLRQSRODULVDWLRQ>-RQHV@ WKXVFRQWULEXWHVWRDFWLYDWLRQSRODULVDWLRQ>-RQHV@
)RUDFWLYDWLRQSRODULVDWLRQWKHUHODWLRQVKLSEHWZHHQWKHFXUUHQWGHQVLW\µL¶DQGWKHDF )RUDFWLYDWLRQSRODULVDWLRQWKHUHODWLRQVKLSEHWZHHQWKHFXUUHQWGHQVLW\µL¶DQGWKHDF
WLYDWLRQRYHUSRWHQWLDOµȘDFW¶LVJLYHQE\WKH7DIHOHTXDWLRQ  WLYDWLRQRYHUSRWHQWLDOµȘDFW¶LVJLYHQE\WKH7DIHOHTXDWLRQ 

§L · §L ·
ηDFW = ± E î ORJ ¨ ¸  >@ ηDFW = ± E î ORJ ¨ ¸  >@
© L ¹ © L ¹
)RUWKHDQRGH )RUWKHDQRGH

§L · §L ·
ηDFWD = ± E D î ORJ ¨ D ¸  >@ ηDFWD = ± E D î ORJ ¨ D ¸  >@
© L ¹ © L ¹
)RUWKHFDWKRGH )RUWKHFDWKRGH

§L · §L ·
ηDFWF = ± E F î ORJ ¨ F ¸ >@ ηDFWF = ± E F î ORJ ¨ F ¸ >@
© L ¹ © L ¹
ZKHUHµED¶DQGµEF¶DUHWKHDQRGLFDQGFDWKRGLF7DIHOFRQVWDQWV LQWKHOLWHUDWXUHDOVR ZKHUHµED¶DQGµEF¶DUHWKHDQRGLFDQGFDWKRGLF7DIHOFRQVWDQWV LQWKHOLWHUDWXUHDOVR
UHIHUUHGWRDV7DIHOVORSHV 7KH7DIHOFRQVWDQWVFDQEHGHWHUPLQHGE\ UHIHUUHGWRDV7DIHOVORSHV 7KH7DIHOFRQVWDQWVFDQEHGHWHUPLQHGE\
 × 5 × 7  × 5 × 7
E =  >@ E =  >@
α×Q×) α×Q×)

ZLWK µĮ¶ DVDFRQVWDQWGHWHUPLQHGE\WKHVKDSHRIWKHHQHUJ\EDUULHULHPDLQO\WKH ZLWK µĮ¶ DVDFRQVWDQWGHWHUPLQHGE\WKHVKDSHRIWKHHQHUJ\EDUULHULHPDLQO\WKH


HOHFWULFDOGRXEOHOD\HU FI6HFWLRQ >%DUGDO@ HOHFWULFDOGRXEOHOD\HU FI6HFWLRQ >%DUGDO@
$FFRUGLQJO\WKH7DIHOHTXDWLRQJLYHVVWUDLJKWOLQHVLQDGLDJUDPSORWWLQJWKHHOHFWURGH $FFRUGLQJO\WKH7DIHOHTXDWLRQJLYHVVWUDLJKWOLQHVLQDGLDJUDPSORWWLQJWKHHOHFWURGH
SRWHQWLDOµ(¶DVDIXQFWLRQRIWKHORJDULWKPRIWKHFXUUHQWGHQVLW\µL¶VHH)LJXUH SRWHQWLDOµ(¶DVDIXQFWLRQRIWKHORJDULWKPRIWKHFXUUHQWGHQVLW\µL¶VHH)LJXUH
7KHVHW\SHVRIGLDJUDPVDUHFRPPRQO\UHIHUUHGWRDV7DIHOGLDJUDPVDQGFRUUHVSRQG 7KHVHW\SHVRIGLDJUDPVDUHFRPPRQO\UHIHUUHGWRDV7DIHOGLDJUDPVDQGFRUUHVSRQG
LQJO\WKHOLQHVDUHNQRZQDV7DIHOOLQHV LQJO\WKHOLQHVDUHNQRZQDV7DIHOOLQHV

 

1DPHGDIWHU-XOLXV7DIHO*HUPDQ\>5REHUJH@ 1DPHGDIWHU-XOLXV7DIHO*HUPDQ\>5REHUJH@

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


.LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

 
)LJXUH 3ORWRIµ(¶DVIXQFWLRQRIORJRIFXUUHQWGHQVLW\µL¶LOOXVWUDWLQJWKHDFWL )LJXUH 3ORWRIµ(¶DVIXQFWLRQRIORJRIFXUUHQWGHQVLW\µL¶LOOXVWUDWLQJWKHDFWL
YDWLRQ RYHUSRWHQWLDO µȘDFW¶ µ(¶ HTXLOLEULXP SRWHQWLDO µL¶ H[FKDQJH YDWLRQ RYHUSRWHQWLDO µȘDFW¶ µ(¶ HTXLOLEULXP SRWHQWLDO µL¶ H[FKDQJH
FXUUHQWGHQVLW\DQGµE¶7DIHOFRQVWDQW,QGLFHVµD¶DQGµF¶GHQRWHDQ FXUUHQWGHQVLW\DQGµE¶7DIHOFRQVWDQW,QGLFHVµD¶DQGµF¶GHQRWHDQ
RGLFDQGFDWKRGLFUHDFWLRQVUHVSHFWLYHO\)RUµLD¶ µLF¶ µL¶LVµȘDFW¶ RGLFDQGFDWKRGLFUHDFWLRQVUHVSHFWLYHO\)RUµLD¶ µLF¶ µL¶LVµȘDFW¶
 $IWHU FRPELQHG LQIRUPDWLRQ IURP >-RQHV  0¡OOHU E  $IWHU FRPELQHG LQIRUPDWLRQ IURP >-RQHV  0¡OOHU E
%DUGDO@ %DUGDO@

 &RQFHQWUDWLRQ3RODULVDWLRQDQG2YHUSRWHQWLDO  &RQFHQWUDWLRQ3RODULVDWLRQDQG2YHUSRWHQWLDO


&RQFHQWUDWLRQSRODULVDWLRQOHDGLQJWRDFRQFHQWUDWLRQRYHUSRWHQWLDOµȘFRQ¶ LVGXHWRWKH &RQFHQWUDWLRQSRODULVDWLRQOHDGLQJWRDFRQFHQWUDWLRQRYHUSRWHQWLDOµȘFRQ¶ LVGXHWRWKH
OLPLWHGPDVVWUDQVSRUWZLWKLQWKHHOHFWURO\WHWKDWRIWHQGHWHUPLQHVWKHUDWHRIWKHHOHF OLPLWHGPDVVWUDQVSRUWZLWKLQWKHHOHFWURO\WHWKDWRIWHQGHWHUPLQHVWKHUDWHRIWKHHOHF
WURFKHPLFDO UHDFWLRQV DW WKH PHWDOHOHFWURO\WH LQWHUIDFH &DWKRGLF UHGXFWLRQ UHDFWLRQV WURFKHPLFDO UHDFWLRQV DW WKH PHWDOHOHFWURO\WH LQWHUIDFH &DWKRGLF UHGXFWLRQ UHDFWLRQV
WHQGWRGHSOHWHWKHHOHFWURO\WHDWWKHPHWDOHOHFWURO\WHLQWHUIDFHRIWKHGLVVROYHGVSH WHQGWRGHSOHWHWKH HOHFWURO\WHDWWKHPHWDOHOHFWURO\WHLQWHUIDFHRIWKHGLVVROYHGVSH
FLHV WKDW LV UHGXFHG 5HGXFWLRQ XVXDOO\ LPSOLHV WKDW WKH UHDFWDQWV LH LRQV RU PROH FLHV WKDW LV UHGXFHG 5HGXFWLRQ XVXDOO\ LPSOLHV WKDW WKH UHDFWDQWV LH LRQV RU PROH
FXOHVDUHWUDQVSRUWHGIURPWKHHOHFWURO\WHWRWKHHOHFWURGHVXUIDFHZKHUHDVIRUWKHDQ FXOHVDUHWUDQVSRUWHGIURPWKHHOHFWURO\WHWRWKHHOHFWURGHVXUIDFHZKHUHDVIRUWKHDQ
RGLFUHDFWLRQWKHUHDFWDQWVDUHGLUHFWO\DYDLODEOHIURPWKHPHWDO7KHUHIRUHFRQFHQ RGLFUHDFWLRQWKHUHDFWDQWVDUHGLUHFWO\DYDLODEOHIURPWKHPHWDO7KHUHIRUHFRQFHQ
WUDWLRQSRODULVDWLRQLQIOXHQFHVWKHWKHRUHWLFDOK\GURJHQDQGR[\JHQHTXLOLEULXPOLQHV WUDWLRQSRODULVDWLRQLQIOXHQFHVWKHWKHRUHWLFDOK\GURJHQDQGR[\JHQHTXLOLEULXPOLQHV
LQWKH3RXUEDL[GLDJUDPDVLQGLFDWHGLQ6HFWLRQ LQWKH3RXUEDL[GLDJUDPDVLQGLFDWHGLQ6HFWLRQ
)RULQVWDQFHIURPWKHHTXLOLEULXPOLQHRIK\GURJHQLRQUHGXFWLRQLQDFLGVROXWLRQWKDW )RULQVWDQFHIURPWKHHTXLOLEULXPOLQHRIK\GURJHQLRQUHGXFWLRQLQDFLGVROXWLRQWKDW
ZDV GHULYHG LQ HTXDWLRQ >@ LW LV REYLRXV WKDWWKH HTXLOLEULXP SRWHQWLDO GHFUHDVHV ZDV GHULYHG LQ HTXDWLRQ >@ LW LV REYLRXV WKDWWKH HTXLOLEULXP SRWHQWLDO GHFUHDVHV
ZLWKGHSOHWLRQRI+DWWKHPHWDOHOHFWURO\WHLQWHUIDFH ZLWKGHSOHWLRQRI+DWWKHPHWDOHOHFWURO\WHLQWHUIDFH

§  · §  ·
(  + +  + =  −

× ORJ ¨
( ) ¸ >@ (  + +  + =  −

× ORJ ¨
( ) ¸ >@
¨ D ¸ ¨ D ¸
© ( ++ ) ¹ © ( ++ ) ¹

 


%DVHGRQWKHJHQHUDO1HUQVWHTXDWLRQ>@WKHFRQFHQWUDWLRQRYHUSRWHQWLDOµȘFRQ¶FDQ %DVHGRQWKHJHQHUDO1HUQVWHTXDWLRQ>@WKHFRQFHQWUDWLRQRYHUSRWHQWLDOµȘFRQ¶FDQ
EHH[SUHVVHGIRUDQ\V\VWHPDVDIXQFWLRQRIWKHFXUUHQWGHQVLW\E\ EHH[SUHVVHGIRUDQ\V\VWHPDVDIXQFWLRQRIWKHFXUUHQWGHQVLW\E\

 × 5 × 7 § L ·  × 5 × 7 § L ·
ηFRQ = × ORJ ¨ − ¸  >@ ηFRQ = × ORJ ¨ − ¸  >@
Q×) © L/ ¹ Q×) © L/ ¹
ZKHUH µL/¶ LVWKHVRFDOOHGOLPLWLQJFXUUHQWGHQVLW\WKDWFDQEHH[SUHVVHGE\LPSOH ZKHUH µL/¶ LVWKHVRFDOOHGOLPLWLQJFXUUHQWGHQVLW\WKDWFDQEHH[SUHVVHGE\LPSOH
PHQWLQJ)DUDGD\¶VODZ FI6HFWLRQ DV PHQWLQJ)DUDGD\¶VODZ FI6HFWLRQ DV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

& &
L/ = Q × ) × ' ×  >@ L/ = Q × ) × ' ×  >@
[ [
ZLWKµ'¶DVWKHGLIIXVLRQFRHIILFLHQWµ&¶DVWKHFRQFHQWUDWLRQRIWKHUHDFWLQJVSHFLHVLQ ZLWKµ'¶DVWKHGLIIXVLRQFRHIILFLHQWµ&¶DVWKHFRQFHQWUDWLRQRIWKHUHDFWLQJVSHFLHVLQ
WKHHOHFWURO\WHDQG µ[¶DVWKHOHQJWKRIWKHGLIIXVLRQGRPDLQ >-RQHV%DUGDO WKHHOHFWURO\WHDQG µ[¶DVWKH OHQJWK RI WKH GLIIXVLRQ GRPDLQ >-RQHV%DUGDO
@$TXDQWLWDWLYHJUDSKRIWKHFRQFHQWUDWLRQRYHUSRWHQWLDOµȘFRQ¶DVH[SUHVVHGE\ @$TXDQWLWDWLYHJUDSKRIWKHFRQFHQWUDWLRQRYHUSRWHQWLDOµȘFRQ¶DVH[SUHVVHGE\
HTXDWLRQ>@LVVKRZQLQ)LJXUH HTXDWLRQ>@LVVKRZQLQ)LJXUH

 
)LJXUH 3ORWRIWKHHOHFWURGHSRWHQWLDOµ(¶DVIXQFWLRQRIWKHORJRIWKHFXUUHQW )LJXUH 3ORWRIWKHHOHFWURGHSRWHQWLDOµ(¶DVIXQFWLRQRIWKHORJRIWKHFXUUHQW
GHQVLW\µL¶LOOXVWUDWLQJWKH FDWKRGLF FRQFHQWUDWLRQRYHUSRWHQWLDOµȘFRQ¶ GHQVLW\µL¶LOOXVWUDWLQJWKH FDWKRGLF FRQFHQWUDWLRQRYHUSRWHQWLDOµȘFRQ¶
7KH GRWWHG OLQHV LQGLFDWH WKH HIIHFW RI VROXWLRQ FRQGLWLRQV $IWHU FRP 7KH GRWWHG OLQHV LQGLFDWH WKH HIIHFW RI VROXWLRQ FRQGLWLRQV $IWHU FRP
ELQHGLQIRUPDWLRQIURP>-RQHV0¡OOHUE@ ELQHGLQIRUPDWLRQIURP>-RQHV0¡OOHUE@
)RU D GHWDLOHG GHULYDWLRQ RI FRQFHQWUDWLRQ RYHUSRWHQWLDO DV D IXQFWLRQ RI WKH FXUUHQW )RU D GHWDLOHG GHULYDWLRQ RI FRQFHQWUDWLRQ RYHUSRWHQWLDO DV D IXQFWLRQ RI WKH FXUUHQW
GHQVLW\DQGWKHOLPLWLQJFXUUHQWGHQVLW\UHIHUHQFHLVPDGHWRWKHOLWHUDWXUHHJ>-RQHV GHQVLW\DQGWKHOLPLWLQJFXUUHQWGHQVLW\UHIHUHQFHLVPDGHWRWKHOLWHUDWXUHHJ>-RQHV
%DUGDO@ %DUGDO@
7KH FRQFHQWUDWLRQ RYHUSRWHQWLDO LV RI SDUWLFXODU LPSRUWDQFH LQ WKH DUHD RI UHLQIRUFH 7KH FRQFHQWUDWLRQ RYHUSRWHQWLDO LV RI SDUWLFXODU LPSRUWDQFH LQ WKH DUHD RI UHLQIRUFH
PHQW FRUURVLRQ 7KH WUDQVSRUW RI UHDFWDQWV IURP WKH RXWVLGH HQYLURQPHQW WR WKH HP PHQW FRUURVLRQ 7KH WUDQVSRUW RI UHDFWDQWV IURP WKH RXWVLGH HQYLURQPHQW WR WKH HP
EHGGHG UHLQIRUFHPHQW E\ GLIIXVLRQ WKURXJK WKH FRQFUHWH EXON LV UDWKHU FRPSOH[ DQG EHGGHG UHLQIRUFHPHQW E\ GLIIXVLRQ WKURXJK WKH FRQFUHWH EXON LV UDWKHU FRPSOH[ DQG
GHSHQGVRQYDULRXVIDFWRUV'LIIXVLRQDQGRWKHUWUDQVSRUWPHFKDQLVPVDVZHOODVIDF GHSHQGVRQYDULRXVIDFWRUV'LIIXVLRQDQGRWKHUWUDQVSRUWPHFKDQLVPVDVZHOODVIDF
WRUVGHWHUPLQLQJWKHLQJUHVVUDWHVDUHGLVFXVVHGLQGHWDLOLQ&KDSWHU WRUVGHWHUPLQLQJWKHLQJUHVVUDWHVDUHGLVFXVVHGLQGHWDLOLQ&KDSWHU

 5HVLVWDQFH3RODULVDWLRQDQG2YHUSRWHQWLDO  5HVLVWDQFH3RODULVDWLRQDQG2YHUSRWHQWLDO


5HVLVWDQFH LQWKHOLWHUDWXUHDOVRUHIHUUHGWRDVRKPLF SRODULVDWLRQDQGDFFRUGLQJO\WKH 5HVLVWDQFH LQWKHOLWHUDWXUHDOVRUHIHUUHGWRDVRKPLF SRODULVDWLRQDQGDFFRUGLQJO\WKH
UHVLVWDQFH RYHUSRWHQWLDO µȘUHV¶ UHVXOW IURP WKH SDVVLYH OD\HUV RU RWKHU VXUIDFH OD\HUV  UHVLVWDQFH RYHUSRWHQWLDO µȘUHV¶ UHVXOW IURP WKH SDVVLYH OD\HUV RU RWKHU VXUIDFH OD\HUV 
WKDWFDQKDYHDFRQVLGHUDEOHRKPLFUHVLVWDQFH‚HYHQLIWKHOD\HULVYHU\WKLQ FI6HF WKDWFDQKDYHDFRQVLGHUDEOHRKPLFUHVLVWDQFH‚HYHQLIWKHOD\HULVYHU\WKLQ FI6HF
WLRQ   $QRGLF UHVLVWDQFH SRODULVDWLRQ LV NQRZQ WR DIIHFW DQRGLF GLVVROXWLRQ DQG WLRQ   $QRGLF UHVLVWDQFH SRODULVDWLRQ LV NQRZQ WR DIIHFW DQRGLF GLVVROXWLRQ DQG
KHQFHWKHFRUURVLRQSRWHQWLDOµ(FRUU¶RQWKHSDVVLYDWHGPHWDOVXUIDFHVZKLOHLWRQO\DI KHQFHWKHFRUURVLRQSRWHQWLDOµ(FRUU¶RQWKHSDVVLYDWHGPHWDOVXUIDFHVZKLOHLWRQO\DI

 

7KHGLIIXVLRQGRPDLQLVWKHDUHDEHWZHHQWKHPHWDOHOHFWURO\WHLQWHUIDFHZKHUHWKHUHDFWDQWLVFRQ 7KHGLIIXVLRQGRPDLQLVWKHDUHDEHWZHHQWKHPHWDOHOHFWURO\WHLQWHUIDFHZKHUHWKHUHDFWDQWLVFRQ
VXPHGDQGWKHEXONRIWKHHOHFWURO\WHZKHUHWUDQVSRUWRIWKHUHDFWDQWLVJRYHUQHGE\FRQYHFWLRQLH VXPHGDQGWKHEXONRIWKHHOHFWURO\WHZKHUHWUDQVSRUWRIWKHUHDFWDQWLVJRYHUQHGE\FRQYHFWLRQLH
WKHFRQFHQWUDWLRQRIWKHUHDFWDQWLVHTXDOWRµ&¶ WKHFRQFHQWUDWLRQRIWKHUHDFWDQWLVHTXDOWRµ&¶
‚ ‚
1DPHGDIWHU*HRUJ6LPRQ2KP*HUPDQ\>5REHUJH@ 1DPHGDIWHU*HRUJ6LPRQ2KP*HUPDQ\>5REHUJH@

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


.LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

IHFWVWKHFDWKRGLFUHDFWLRQVIRUWKHVHFRQGJURXSRISDVVLYHOD\HUV FI6HFWLRQ  IHFWVWKHFDWKRGLFUHDFWLRQVIRUWKHVHFRQGJURXSRISDVVLYHOD\HUV FI6HFWLRQ 


>-RQHV0¡OOHUE%DUGDO@ >-RQHV0¡OOHUE%DUGDO@
:KHQDFXUUHQWµ,¶RUWKHFXUUHQWGHQVLW\µL¶LVIORZLQJWKURXJKWKHILOPWKHUHZLOOEH :KHQDFXUUHQWµ,¶RUWKHFXUUHQWGHQVLW\µL¶LVIORZLQJWKURXJKWKHILOPWKHUHZLOOEH
DQRKPLFGURSDFFRUGLQJWR2KP¶VODZ7KXVWKHUHVLVWDQFHRYHUSRWHQWLDOµȘUHV¶FDQ DQRKPLFGURSDFFRUGLQJWR2KP¶VODZ7KXVWKHUHVLVWDQFHRYHUSRWHQWLDOµȘUHV¶FDQ
EHH[SUHVVHGE\ EHH[SUHVVHGE\
ηU HV = 5 SDV × , = USDV × L  >@ ηU HV = 5 SDV × , = USDV × L  >@

:KHUH µ5SDV¶ DQG µUSDV¶ DUHWKHUHVLVWDQFHVRIWKHSDVVLYHOD\HURQWKHWRWDOHOHFWURGH :KHUH µ5SDV¶ DQG µUSDV¶ DUHWKHUHVLVWDQFHVRIWKHSDVVLYHOD\HURQWKHWRWDOHOHFWURGH
VXUIDFHDQGRQFPRIWKHHOHFWURGHVXUIDFHUHVSHFWLYHO\ VXUIDFHDQGRQFPRIWKHHOHFWURGHVXUIDFHUHVSHFWLYHO\
$VLQGLFDWHGE\2KP¶VODZLQHTXDWLRQ>@WKHSORWRIWKHµȘUHV¶LVUHSUHVHQWHGE\D $VLQGLFDWHGE\2KP¶VODZLQHTXDWLRQ>@WKHSORWRIWKHµȘUHV¶LVUHSUHVHQWHGE\D
VWUDLJKWOLQHZLWKDVORSHGHWHUPLQHGE\WKHRKPLFUHVLVWDQFHRIWKHSDVVLYHOD\HU VWUDLJKWOLQHZLWKDVORSHGHWHUPLQHGE\WKHRKPLFUHVLVWDQFHRIWKHSDVVLYHOD\HU

 $SSHDUDQFHDQG&RPELQDWLRQRI3RODULVDWLRQDQG2YHUSRWHQWLDOV  $SSHDUDQFHDQG&RPELQDWLRQRI3RODULVDWLRQDQG2YHUSRWHQWLDOV


,QSUDFWLFHWKHGLVFXVVHGSRODULVDWLRQHIIHFWVGRJHQHUDOO\QRWRFFXULQGLYLGXDOO\EXWD ,QSUDFWLFHWKHGLVFXVVHGSRODULVDWLRQHIIHFWVGRJHQHUDOO\QRWRFFXULQGLYLGXDOO\EXWD
FRPELQDWLRQRIDOOWKUHHSRODULVDWLRQHIIHFWVRQWKHLQYHVWLJDWHGHOHFWURFKHPLFDOV\V FRPELQDWLRQRIDOOWKUHHSRODULVDWLRQHIIHFWVRQWKHLQYHVWLJDWHGHOHFWURFKHPLFDOV\V
WHP LV REVHUYHG )RU DQRGLF UHDFWLRQV DFWLYDWLRQ SRODULVDWLRQ LV XVXDOO\ GRPLQDWLQJ WHP LV REVHUYHG )RU DQRGLF UHDFWLRQV DFWLYDWLRQ SRODULVDWLRQ LV XVXDOO\ GRPLQDWLQJ
H[FHSWZKHQSDVVLYDWLRQWDNHVSODFH$FFRUGLQJO\WKHUHODWLRQVKLSEHWZHHQWKHRYHU H[FHSWZKHQSDVVLYDWLRQWDNHVSODFH$FFRUGLQJO\WKHUHODWLRQVKLSEHWZHHQWKHRYHU
SRWHQWLDODQGWKHFXUUHQWGHQVLW\IRUDQRGLFUHDFWLRQVFDQJHQHUDOO\EHH[SUHVVHGE\ SRWHQWLDODQGWKHFXUUHQWGHQVLW\IRUDQRGLFUHDFWLRQVFDQJHQHUDOO\EHH[SUHVVHGE\

§L · §L ·
ηDFWD = ± E D î ORJ ¨ D ¸  >@ ηDFWD = ± E D î ORJ ¨ D ¸  >@
© L ¹ © L ¹
)RU FDWKRGLF UHDFWLRQV WKH UHDFWLRQ UDWH LV XVXDOO\ JRYHUQHG E\ ERWK DFWLYDWLRQ DQG )RU FDWKRGLF UHDFWLRQV WKH UHDFWLRQ UDWH LV XVXDOO\ JRYHUQHG E\ ERWK DFWLYDWLRQ DQG
FRQFHQWUDWLRQSRODULVDWLRQ7KXVWKHUHODWLRQVKLSEHWZHHQWKHRYHUSRWHQWLDODQGFXU FRQFHQWUDWLRQSRODULVDWLRQ7KXVWKHUHODWLRQVKLSEHWZHHQWKHRYHUSRWHQWLDODQGFXU
UHQWGHQVLW\IRUFDWKRGLFUHDFWLRQVFDQEHH[SUHVVHGDVWKHVXPRIHTXDWLRQV>@ UHQWGHQVLW\IRUFDWKRGLFUHDFWLRQVFDQEH H[SUHVVHGDVWKHVXPRIHTXDWLRQV>@
DQG>@E\ DQG>@E\

§ L ·  × 5 × 7 § L · § L ·  × 5 × 7 § L ·
ηDFWF + ηFRQF F = ± E F î ORJ ¨ F ¸ + × ORJ ¨ − F ¸  >@ ηDFWF + ηFRQF F = ± E F î ORJ ¨ F ¸ + × ORJ ¨ − F ¸  >@
L
© ¹ Q × ) © L/ ¹ L
© ¹ Q × ) © L/ ¹
,IDSDVVLYDWHGPHWDOVXUIDFHLVLQYHVWLJDWHGWKHHIIHFWRIUHVLVWDQFHSRODULVDWLRQFDQ ,IDSDVVLYDWHGPHWDOVXUIDFHLVLQYHVWLJDWHGWKH HIIHFWRIUHVLVWDQFHSRODULVDWLRQFDQ
DGGLWLRQDOO\EHWDNHQLQWRDFFRXQWDVGHVFULEHGLQ6HFWLRQ DGGLWLRQDOO\EHWDNHQLQWRDFFRXQWDVGHVFULEHGLQ6HFWLRQ

 3RODULVDWLRQ&XUYHV  3RODULVDWLRQ&XUYHV


7KHSUHVHQFHDQGWKHHIIHFWRIWKHW\SHVRISRODULVDWLRQGHVFULEHGLQ6HFWLRQDV 7KHSUHVHQFHDQGWKHHIIHFWRIWKHW\SHVRISRODULVDWLRQGHVFULEHGLQ6HFWLRQDV
ZHOODVWKHSDVVLYDWLRQDQGGHSDVVLYDWLRQEHKDYLRXURIDPHWDOFDQEHGHWHUPLQHGE\ ZHOODVWKHSDVVLYDWLRQDQGGHSDVVLYDWLRQEHKDYLRXURIDPHWDOFDQEHGHWHUPLQHGE\
VRFDOOHG SRODULVDWLRQ FXUYHV )RU D SRODULVDWLRQ FXUYH WKH HOHFWURGH SRWHQWLDO µ(¶ LV VRFDOOHG SRODULVDWLRQ FXUYHV )RU D SRODULVDWLRQ FXUYH WKH HOHFWURGH SRWHQWLDO µ(¶ LV
SORWWHGRQWKH<D[LVDVDIXQFWLRQRIWKHFXUUHQWGHQVLW\µL¶RQWKH;D[LV,QFRUUH SORWWHGRQWKH<D[LVDVDIXQFWLRQRIWKHFXUUHQWGHQVLW\µL¶RQWKH;D[LV,QFRUUH
VSRQGHQFH ZLWK WKH 7DIHO OLQHV FI 6HFWLRQ   WKH DSSOLHG FXUUHQW LV JHQHUDOO\ VSRQGHQFH ZLWK WKH 7DIHO OLQHV FI 6HFWLRQ   WKH DSSOLHG FXUUHQW LV JHQHUDOO\
SORWWHGRQDORJDULWKPLFVFDOH SORWWHGRQDORJDULWKPLFVFDOH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

,Q DFFRUGDQFH ZLWK WKH GHILQLWLRQV IRU DQRGLF DQG FDWKRGLF SRODULVDWLRQ GHVFULEHG LQ ,Q DFFRUGDQFH ZLWK WKH GHILQLWLRQV IRU DQRGLF DQG FDWKRGLF SRODULVDWLRQ GHVFULEHG LQ
6HFWLRQ  D SRODULVDWLRQ FXUYH LV UHIHUUHG WR DV DQRGLF RU FDWKRGLF SRODULVDWLRQ 6HFWLRQ  D SRODULVDWLRQ FXUYH LV UHIHUUHG WR DV DQRGLF RU FDWKRGLF SRODULVDWLRQ
FXUYH LI WKH PHWDO LV SRODULVHG LQ SRVLWLYH RU QHJDWLYH GLUHFWLRQ UHVSHFWLYHO\ 7KXV FXUYH LI WKH PHWDO LV SRODULVHG LQ SRVLWLYH RU QHJDWLYH GLUHFWLRQ UHVSHFWLYHO\ 7KXV
DQRGLF SRODULVDWLRQV FXUYHV UHSUHVHQW DQRGLF UHDFWLRQV HJ PHWDO GLVVROXWLRQ DQG DQRGLF SRODULVDWLRQV FXUYHV UHSUHVHQW DQRGLF UHDFWLRQV HJ PHWDO GLVVROXWLRQ DQG
FDWKRGLF SRODULVDWLRQ FXUYHV UHSUHVHQW FDWKRGLF UHDFWLRQV HJ R[\JHQ RU K\GURJHQ FDWKRGLF SRODULVDWLRQ FXUYHV UHSUHVHQW FDWKRGLF UHDFWLRQV HJ R[\JHQ RU K\GURJHQ
LRQUHGXFWLRQ FI6HFWLRQ  LRQUHGXFWLRQ FI6HFWLRQ 
+HQFH D SRODULVDWLRQ FXUYH LV D PHDVXUH RI KRZ WKH UDWHV RI WKH DQRGLF DQG WKH FD +HQFH D SRODULVDWLRQ FXUYH LV D PHDVXUH RI KRZ WKH UDWHV RI WKH DQRGLF DQG WKH FD
WKRGLF UHDFWLRQV DUH OLPLWHG E\ DFWLYDWLRQ FRQFHQWUDWLRQ DQG UHVLVWDQFH SRODULVDWLRQ WKRGLF UHDFWLRQV DUH OLPLWHG E\ DFWLYDWLRQ FRQFHQWUDWLRQ DQG UHVLVWDQFH SRODULVDWLRQ
LHWKHYDULDWLRQRIWKHSRWHQWLDODVDIXQFWLRQRIWKHFXUUHQWHQDEOHVWRYLVXDOLVHWKH LHWKHYDULDWLRQRIWKHSRWHQWLDODVDIXQFWLRQRIWKHFXUUHQWHQDEOHVWRYLVXDOLVHWKH
HIIHFWRISRODULVDWLRQSURFHVVHVRQWKHUDWHDWZKLFKWKHDQRGLFRUFDWKRGLFUHDFWLRQV HIIHFWRISRODULVDWLRQSURFHVVHVRQWKHUDWHDWZKLFKWKHDQRGLFRUFDWKRGLFUHDFWLRQV
FDQJLYHXSRUDFFHSWHOHFWURQV3RODULVDWLRQFXUYHVFDQEHEHQHILFLDOO\DSSOLHGWRGH FDQJLYHXSRUDFFHSWHOHFWURQV3RODULVDWLRQFXUYHVFDQEHEHQHILFLDOO\DSSOLHGWRGH
WHUPLQHWKHUDWHRIWKHUHDFWLRQVWKDWDUHLQYROYHGLQWKHFRUURVLRQSURFHVVLHWKHFRU WHUPLQHWKHUDWHRIWKHUHDFWLRQVWKDWDUHLQYROYHGLQWKHFRUURVLRQSURFHVVLHWKHFRU
URVLRQUDWH <HWFRQWUDU\WRWKH3RXUEDL[GLDJUDPDVLQJOHSRODULVDWLRQFXUYHUHSUH URVLRQUDWH <HWFRQWUDU\WRWKH3RXUEDL[GLDJUDPDVLQJOHSRODULVDWLRQFXUYHUHSUH
VHQWV WKH FRUURVLRQ SURFHVVHV IRU RQH FHUWDLQ S+ RI WKH HOHFWURO\WH 0RUHRYHU LW VHQWV WKH FRUURVLRQ SURFHVVHV IRU RQH FHUWDLQ S+ RI WKH HOHFWURO\WH 0RUHRYHU LW
VKRXOGEHHPSKDVLVHGWKDWLQSUDFWLFHWKHS+DWWKHPHWDOHOHFWURO\WHLQWHUIDFHFDQGH VKRXOGEHHPSKDVLVHGWKDWLQSUDFWLFHWKHS+DWWKHPHWDOHOHFWURO\WHLQWHUIDFHFDQGH
YLDWHODUJHO\IURPWKHEXONHOHFWURO\WHS+DQGIXUWKHUH[SHULHQFHFKDQJHVGXULQJWKH YLDWHODUJHO\IURPWKHEXONHOHFWURO\WHS+DQGIXUWKHUH[SHULHQFHFKDQJHVGXULQJWKH
PHDVXUHPHQWGXHWRUHDFWLRQVRQWKHPHWDOVXUIDFHZKLFKLVSDUWLFXODUO\UHOHYDQWIRU PHDVXUHPHQWGXHWRUHDFWLRQVRQWKHPHWDOVXUIDFHZKLFKLVSDUWLFXODUO\UHOHYDQWIRU
WKH VWXG\ RI ORFDOLVHG FRUURVLRQ SKHQRPHQD HJ SLWWLQJ DQG FUHYLFH FRUURVLRQ FI WKH VWXG\ RI ORFDOLVHG FRUURVLRQ SKHQRPHQD HJ SLWWLQJ DQG FUHYLFH FRUURVLRQ FI
6HFWLRQ  6HFWLRQ 

 7DIHO/LQHV  7DIHO/LQHV


)LJXUHVKRZVDVFKHPDWLFH[HPSOLILFDWLRQRIDSRODULVDWLRQFXUYHDURXQGWKHDUHD )LJXUHVKRZVDVFKHPDWLFH[HPSOLILFDWLRQRIDSRODULVDWLRQFXUYHDURXQGWKHDUHD
RIµ(FRUU¶EDVHGRQR[LGDWLRQRILURQDVDQRGLFUHDFWLRQDQGK\GURJHQLRQUHGXFWLRQDV RIµ(FRUU¶EDVHGRQR[LGDWLRQRILURQDVDQRGLFUHDFWLRQDQGK\GURJHQLRQUHGXFWLRQDV
FDWKRGLFUHDFWLRQ FDWKRGLFUHDFWLRQ
7KHDVVRFLDWHGDQRGLFRYHUSRWHQWLDOFXUYHUHSUHVHQWLQJR[LGDWLRQRILURQWRIHUURXVLRQ 7KHDVVRFLDWHGDQRGLFRYHUSRWHQWLDOFXUYHUHSUHVHQWLQJR[LGDWLRQRILURQWRIHUURXVLRQ
DQGWKHFDWKRGLFRYHUSRWHQWLDOFXUYHUHSUHVHQWLQJK\GURJHQLRQUHGXFWLRQ UHGOLQHV  DQGWKHFDWKRGLFRYHUSRWHQWLDOFXUYHUHSUHVHQWLQJK\GURJHQLRQ UHGXFWLRQ UHGOLQHV 
DUHGHWHUPLQHGE\WKHLUDVVRFLDWHG7DIHOFRQVWDQWVµE¶DVZHOODVµ(¶DQGµL¶$VPHQ DUHGHWHUPLQHGE\WKHLUDVVRFLDWHG7DIHOFRQVWDQWVµE¶DVZHOODVµ(¶DQGµL¶$VPHQ
WLRQHGLQ6HFWLRQERWKWKHDQRGLFUHDFWLRQLHR[LGDWLRQRILURQDQGWKHFD WLRQHGLQ6HFWLRQERWKWKHDQRGLFUHDFWLRQLHR[LGDWLRQRILURQDQGWKHFD
WKRGLFUHDFWLRQLHK\GURJHQLRQUHGXFWLRQDUHLQWKLVSRWHQWLDOUDQJHSUHGRPLQDWHO\ WKRGLFUHDFWLRQLHK\GURJHQLRQUHGXFWLRQDUHLQWKLVSRWHQWLDOUDQJHSUHGRPLQDWHO\
FRQWUROOHGE\DFWLYDWLRQSRODULVDWLRQ7KHRYHUSRWHQWLDOFXUYHVLHWKH7DIHOOLQHVDUH FRQWUROOHGE\DFWLYDWLRQSRODULVDWLRQ7KHRYHUSRWHQWLDOFXUYHVLHWKH7DIHOOLQHVDUH
DV\PSWRWHVWRWKHDQRGLFDQGFDWKRGLFSRODULVDWLRQFXUYHV EOXHOLQHV 7KHGHYLDWLRQ DV\PSWRWHVWRWKHDQRGLFDQGFDWKRGLFSRODULVDWLRQFXUYHV EOXHOLQHV 7KHGHYLDWLRQ
EHWZHHQWKHSRODULVDWLRQFXUYHVDQGWKH7DIHOOLQHVLVGXHWRWKHIDFWWKDWWKHDQRGLF EHWZHHQWKHSRODULVDWLRQFXUYHVDQGWKH7DIHOOLQHVLVGXHWRWKHIDFWWKDWWKHDQRGLF
DQGFDWKRGLFUHDFWLRQVRFFXUVLPXOWDQHRXVO\FORVHWRµ(FRUU¶>%DUGDO@,Q6HFWLRQ DQGFDWKRGLFUHDFWLRQVRFFXUVLPXOWDQHRXVO\FORVHWRµ(FRUU¶>%DUGDO@,Q6HFWLRQ
 LW LV VKRZQ WKDW WKH DQRGLF RYHUSRWHQWLDO FXUYH DQG WKH DQRGLF SRODULVDWLRQ  LW LV VKRZQ WKDW WKH DQRGLF RYHUSRWHQWLDO FXUYH DQG WKH DQRGLF SRODULVDWLRQ
FXUYH DUH HVVHQWLDOO\ LGHQWLFDO DW KLJKHU SRWHQWLDOV H[FHSW IRU YHU\ QREOH SRWHQWLDOV FXUYH DUH HVVHQWLDOO\ LGHQWLFDO DW KLJKHU SRWHQWLDOV H[FHSW IRU YHU\ QREOH SRWHQWLDOV
ZKHUHR[LGDWLRQRIZDWHULHR[\JHQHYROXWLRQLQWHUIHUHVZLWKWKHDQRGLFGLVVROXWLRQ ZKHUHR[LGDWLRQRIZDWHULHR[\JHQHYROXWLRQLQWHUIHUHVZLWKWKHDQRGLFGLVVROXWLRQ
RILURQ RILURQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


.LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

 
)LJXUH 3ORWRIWKHHOHFWURGHSRWHQWLDOµ(¶DVIXQFWLRQRIWKHORJRIWKHFXUUHQW )LJXUH 3ORWRIWKHHOHFWURGHSRWHQWLDOµ(¶DVIXQFWLRQRIWKHORJRIWKHFXUUHQW
GHQVLW\µL¶LOOXVWUDWLQJDVFKHPDWLFSRODULVDWLRQFXUYHLQWKHYLFLQLW\RI GHQVLW\µL¶LOOXVWUDWLQJDVFKHPDWLFSRODULVDWLRQFXUYHLQWKHYLFLQLW\RI
WKH FRUURVLRQ SRWHQWLDO µ(FRUU¶ µ(¶ HTXLOLEULXP SRWHQWLDO µL¶ H[ WKH FRUURVLRQ SRWHQWLDO µ(FRUU¶ µ(¶ HTXLOLEULXP SRWHQWLDO µL¶ H[
FKDQJH FXUUHQW GHQVLW\ µLFRUU¶ FRUURVLRQ FXUUHQW GHQVLW\ µȘ¶ RYHUSR FKDQJH FXUUHQW GHQVLW\ µLFRUU¶ FRUURVLRQ FXUUHQW GHQVLW\ µȘ¶ RYHUSR
WHQWLDO µE¶ 7DIHO FRQVWDQW DQG µ3R&X¶  SRODULVDWLRQ FXUYH ,QGLFHV WHQWLDO µE¶ 7DIHO FRQVWDQW DQG µ3R&X¶  SRODULVDWLRQ FXUYH ,QGLFHV
µD¶DQGµF¶GHQRWHDQRGLFDQGFDWKRGLFUHDFWLRQVUHVSHFWLYHO\7KHHI µD¶DQGµF¶GHQRWHDQRGLFDQGFDWKRGLFUHDFWLRQVUHVSHFWLYHO\7KHHI
IHFWRIDQDVVXPHGLQFUHDVHGµLF¶RQµLFRUU¶LVLOOXVWUDWHGE\DVWHULVNV IHFWRIDQDVVXPHGLQFUHDVHGµLF¶RQµLFRUU¶LVLOOXVWUDWHGE\DVWHULVNV
$IWHUFRPELQHGLQIRUPDWLRQIURP>-RQHV.UXJHU%DUGDO $IWHUFRPELQHGLQIRUPDWLRQIURP>-RQHV.UXJHU%DUGDO
@ @
,WVKRXOGEHQRWHGWKDWWKHSRODULVDWLRQFXUYHVEXWQRWWKH7DIHOFRQVWDQWVDUHJHQHU ,WVKRXOGEHQRWHGWKDWWKHSRODULVDWLRQFXUYHVEXWQRWWKH7DIHOFRQVWDQWVDUHJHQHU
DOO\REWDLQHGE\H[SHULPHQWV7KHPHDVXUHGSRODULVDWLRQFXUYHVDUHXVHGWRGHWHUPLQH DOO\REWDLQHGE\H[SHULPHQWV7KHPHDVXUHGSRODULVDWLRQFXUYHVDUHXVHGWRGHWHUPLQH
WKHRYHUSRWHQWLDOFXUYHVDQGZLWKWKDWWKHSDUDPHWHUVLHWKH7DIHOFRQVWDQWVµE¶DQG WKHRYHUSRWHQWLDOFXUYHVDQGZLWKWKDWWKHSDUDPHWHUVLHWKH7DIHOFRQVWDQWVµE¶DQG
QRW YLFH YHUVD $V H[SODLQHG LQ PRUH GHWDLO LQ 6HFWLRQ  WKH ORJDULWKP LV WDNHQ QRW YLFH YHUVD $V H[SODLQHG LQ PRUH GHWDLO LQ 6HFWLRQ  WKH ORJDULWKP LV WDNHQ
IURPWKHDEVROXWHYDOXHRIWKHFXUUHQWGHQVLW\LIWKHSRODULVDWLRQFXUYHLVGHWHUPLQHG IURPWKHDEVROXWHYDOXHRIWKHFXUUHQWGHQVLW\LIWKHSRODULVDWLRQFXUYHLVGHWHUPLQHG
H[SHULPHQWDOO\6HFWLRQSURYLGHVLQIRUPDWLRQRQWKHH[SHULPHQWDOGHWHUPLQDWLRQ H[SHULPHQWDOO\6HFWLRQSURYLGHVLQIRUPDWLRQRQWKHH[SHULPHQWDOGHWHUPLQDWLRQ
RISRODULVDWLRQFXUYHVIRUJHQHUDODTXHRXVFRUURVLRQV\VWHPVZKHUHDVWKHDSSOLFDWLRQ RISRODULVDWLRQFXUYHVIRUJHQHUDODTXHRXVFRUURVLRQV\VWHPVZKHUHDVWKHDSSOLFDWLRQ
RISRODULVDWLRQFXUYHVLQUHLQIRUFHPHQWFRUURVLRQLVGHVFULEHGLQ6HFWLRQ RISRODULVDWLRQFXUYHVLQUHLQIRUFHPHQWFRUURVLRQLVGHVFULEHGLQ6HFWLRQ
7KHLQWHUFHSWRIWKHH[WUDSRODWLRQRIWKH7DIHOOLQHVLQ)LJXUHZKLFKXQGHULGHDO 7KHLQWHUFHSWRIWKHH[WUDSRODWLRQRIWKH7DIHOOLQHVLQ)LJXUHZKLFKXQGHULGHDO
FRQGLWLRQVLVLQOLQHZLWKWKHFRUURVLRQSRWHQWLDOµ(FRUU¶UHSUHVHQWVWKHORJDULWKPRIWKH FRQGLWLRQVLVLQOLQHZLWKWKHFRUURVLRQSRWHQWLDOµ(FRUU¶UHSUHVHQWVWKHORJDULWKPRIWKH
FRUURVLRQFXUUHQWGHQVLW\µLFRUU¶ZKLFKH[SUHVVHVWKHLQKHUHQWFRUURVLRQUDWHRIWKHUH FRUURVLRQFXUUHQWGHQVLW\µLFRUU¶ZKLFKH[SUHVVHVWKHLQKHUHQWFRUURVLRQUDWHRIWKHUH
GR[FRXSOH GR[FRXSOH
$VPHQWLRQHGLQ6HFWLRQWKHPDJQLWXGHVRIWKHH[FKDQJHFXUUHQWGHQVLWLHVIRU $VPHQWLRQHGLQ6HFWLRQWKHPDJQLWXGHVRIWKH H[FKDQJHFXUUHQWGHQVLWLHVIRU
WKHFDWKRGLFDQGDQRGLFUHDFWLRQVKDYHDPDMRUHIIHFWRQWKHFRUURVLRQUDWH7KLVFDQ WKHFDWKRGLFDQGDQRGLFUHDFWLRQVKDYHDPDMRUHIIHFWRQWKHFRUURVLRQUDWH7KLVFDQ
EHLOOXVWUDWHGE\FRQVLGHULQJDKLJKHUH[FKDQJHFXUUHQWGHQVLW\ µL ¶ IRUWKHFDWKRGLF EHLOOXVWUDWHGE\FRQVLGHULQJDKLJKHUH[FKDQJHFXUUHQWGHQVLW\ µL ¶ IRUWKHFDWKRGLF
UHDFWLRQZKLOHDVVXPLQJWKDWWKHHTXLOLEULXPSRWHQWLDOLVFRQVWDQW7KHLQFUHDVHGFRU UHDFWLRQZKLOHDVVXPLQJWKDWWKHHTXLOLEULXPSRWHQWLDOLVFRQVWDQW7KHLQFUHDVHGFRU
URVLRQ FXUUHQW µLFRUU ¶  VKRZV WKDW WKH FRUURVLRQ UDWH LQFUHDVHV ZLWK LQFUHDVLQJ H[ URVLRQ FXUUHQW µLFRUU ¶  VKRZV WKDW WKH FRUURVLRQ UDWH LQFUHDVHV ZLWK LQFUHDVLQJ H[
FKDQJHFXUUHQWGHQVLW\ FKDQJHFXUUHQWGHQVLW\

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ

 (YDQV'LDJUDP  (YDQV'LDJUDP


7KHH[WUDSRODWLRQVRIWKHDQRGLFDQGFDWKRGLF7DIHOOLQHVDUHRIWHQXVHGWRSURGXFHVR 7KHH[WUDSRODWLRQVRIWKHDQRGLFDQGFDWKRGLF7DIHOOLQHVDUHRIWHQXVHGWRSURGXFHVR
FDOOHG(YDQVGLDJUDPV ZKLFKDUHH[HPSOLILHGLQ)LJXUH FDOOHG(YDQVGLDJUDPV ZKLFKDUHH[HPSOLILHGLQ)LJXUH

 
)LJXUH 3ORWRIWKHHOHFWURGHSRWHQWLDOµ(¶DVIXQFWLRQRIWKHORJRIWKHFXUUHQW )LJXUH 3ORWRIWKHHOHFWURGHSRWHQWLDOµ(¶DVIXQFWLRQRIWKHORJRIWKHFXUUHQW
GHQVLW\µL¶SUHVHQWLQJ(YDQVGLDJUDPVWRLOOXVWUDWHWKUHHRSWLRQVRIFRU GHQVLW\µL¶SUHVHQWLQJ(YDQVGLDJUDPVWRLOOXVWUDWHWKUHHRSWLRQVRIFRU
URVLRQFRQWUROµ(¶HTXLOLEULXPSRWHQWLDOµ(FRUU¶FRUURVLRQSRWHQWLDO URVLRQFRQWUROµ(¶HTXLOLEULXPSRWHQWLDOµ(FRUU¶FRUURVLRQSRWHQWLDO
µLFRUU¶FRUURVLRQFXUUHQWGHQVLW\,QGLFHVµD¶DQGµF¶GHQRWHDQRGLFDQG µLFRUU¶FRUURVLRQFXUUHQWGHQVLW\,QGLFHVµD¶DQGµF¶GHQRWHDQRGLFDQG
FDWKRGLF UHDFWLRQV UHVSHFWLYHO\ >$@ $QRGLF FRQWURO >%@ &DWKRGLF FDWKRGLF UHDFWLRQV UHVSHFWLYHO\ >$@ $QRGLF FRQWURO >%@ &DWKRGLF
FRQWURO>&@0L[HGPRGH$IWHU>.UXJHU@ FRQWURO>&@0L[HGPRGH$IWHU>.UXJHU@
7KHUHODWLYHVORSHVRIWKHH[WUDSRODWHG7DIHOOLQHVREWDLQHGIURPDQRGLFDQGFDWKRGLF 7KHUHODWLYHVORSHVRIWKHH[WUDSRODWHG7DIHOOLQHVREWDLQHGIURPDQRGLFDQGFDWKRGLF
SRODULVDWLRQFXUYHVGHWHUPLQHZKHWKHUWKHDQRGLFFDWKRGLFRUERWKUHDFWLRQVFRQWURO SRODULVDWLRQFXUYHVGHWHUPLQHZKHWKHUWKHDQRGLFFDWKRGLFRUERWKUHDFWLRQVFRQWURO
WKHUDWHRIWKHFRUURVLRQSURFHVV)LJXUH>$@UHSUHVHQWVDV\VWHPXQGHUDQRGLFFRQ WKHUDWHRIWKHFRUURVLRQSURFHVV)LJXUH>$@UHSUHVHQWVDV\VWHPXQGHUDQRGLFFRQ
WURO)LJXUH>%@GHQRWHVWRDV\VWHPXQGHUFDWKRGLFFRQWURODQGWKHVORSHVLQ)LJ WURO)LJXUH>%@GHQRWHVWRDV\VWHPXQGHUFDWKRGLFFRQWURODQGWKHVORSHVLQ)LJ
XUH>&@LQGLFDWHWKDWWKHV\VWHPLVFRQWUROOHGE\ERWKWKHDQRGLFDQGFDWKRGLFUHDF XUH>&@LQGLFDWHWKDWWKHV\VWHPLVFRQWUROOHGE\ERWKWKHDQRGLFDQGFDWKRGLFUHDF
WLRQVLHDPL[HGPRGH‚(YDQVGLDJUDPVFDQEHEHQHILFLDOO\DSSOLHGWRHYDOXDWHWKH WLRQVLHDPL[HGPRGH‚(YDQVGLDJUDPVFDQEHEHQHILFLDOO\DSSOLHGWRHYDOXDWHWKH
HIIHFWRIYDULRXVIDFWRUVRQWKHFRUURVLRQUDWHLQDQHOHFWURFKHPLFDOV\VWHP>.UXJHU HIIHFWRIYDULRXVIDFWRUVRQWKHFRUURVLRQUDWHLQDQHOHFWURFKHPLFDOV\VWHP>.UXJHU
0¡OOHUE@ 0¡OOHUE@

 3DVVLYLW\  3DVVLYLW\


$QRGLFSRODULVDWLRQFXUYHVFDQEHXVHGWRYLVXDOLVHWKHSDVVLYDWLRQDQGGHSDVVLYDWLRQ $QRGLFSRODULVDWLRQFXUYHVFDQEHXVHGWRYLVXDOLVHWKHSDVVLYDWLRQDQGGHSDVVLYDWLRQ
EHKDYLRXURIPHWDOV)LJXUHVKRZVDK\SRWKHWLFDOFDWKRGLFDQGDQRGLFSRODULVDWLRQ EHKDYLRXURIPHWDOV)LJXUHVKRZVDK\SRWKHWLFDOFDWKRGLFDQGDQRGLFSRODULVDWLRQ
FXUYH IRU D SDVVLYH PHWDO 0RUHRYHU WKH WHUPLQRORJ\ DQG DEEUHYLDWLRQV IRU WKH GH FXUYH IRU D SDVVLYH PHWDO 0RUHRYHU WKH WHUPLQRORJ\ DQG DEEUHYLDWLRQV IRU WKH GH
VFULSWLRQRISRODULVDWLRQFXUYHVDVUHFRPPHQGHGE\$670>$670*@DUHLQ VFULSWLRQRISRODULVDWLRQFXUYHVDVUHFRPPHQGHGE\$670>$670*@DUHLQ
WURGXFHG WURGXFHG

 

1DPHGDIWHU8OLFN5LFKDUGVRQ(YDQV8.>5REHUJH@ 1DPHGDIWHU8OLFN5LFKDUGVRQ(YDQV8.>5REHUJH@
‚ ‚
7KHWHUPVDQRGLFFRQWURODQGFDWKRGLFFRQWURODUHXVHGLQFRUUHVSRQGHQFHZLWK)LJXUHWKURXJKRXW 7KHWHUPVDQRGLFFRQWURODQGFDWKRGLFFRQWURODUHXVHGLQFRUUHVSRQGHQFHZLWK)LJXUHWKURXJKRXW
WKLVWKHVLVDOWKRXJKZHWKLQNWKDWWKLVWHUPLQRORJ\FDQEHPLVOHDGLQJHJZLWKUHJDUGWRWKHLQIOX WKLVWKHVLVDOWKRXJKZHWKLQNWKDWWKLVWHUPLQRORJ\FDQEHPLVOHDGLQJHJZLWKUHJDUGWRWKHLQIOX
HQFHRIWKHDQRGLFDQGFDWKRGLFSURFHVVHVRQWKHGHYHORSPHQWRIµ(FRUU¶ FI6HFWLRQ  HQFHRIWKHDQRGLFDQGFDWKRGLFSURFHVVHVRQWKHGHYHORSPHQWRIµ(FRUU¶ FI6HFWLRQ 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


.LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ .LQHWLFVRI$TXHRXV0HWDOOLF&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

 
)LJXUH +\SRWKHWLFDO FDWKRGLF DQG DQRGLF SRODULVDWLRQ FXUYH RI DQ DFWLYH )LJXUH +\SRWKHWLFDO FDWKRGLF DQG DQRGLF SRODULVDWLRQ FXUYH RI DQ DFWLYH
SDVVLYH PHWDO ZLWK UHFRPPHQGHG WHUPLQRORJ\ DQG DEEUHYLDWLRQV IRU SDVVLYH PHWDO ZLWK UHFRPPHQGHG WHUPLQRORJ\ DQG DEEUHYLDWLRQV IRU
WKHGHVFULSWLRQRISRODULVDWLRQFXUYHV)URP>$670*@ WKHGHVFULSWLRQRISRODULVDWLRQFXUYHV)URP>$670*@
7KHFDWKRGLFSRODULVDWLRQFXUYHDQGWKHOLQHDUDQRGLFEUDQFKDERYHµ(FRUU¶DVZHOODV 7KHFDWKRGLFSRODULVDWLRQFXUYHDQGWKHOLQHDUDQRGLFEUDQFKDERYHµ(FRUU¶DVZHOODV
WKH7DIHOOLQHV GDVKHGOLQHV KDYHEHHQLQWURGXFHGLQ6HFWLRQ,IWKHSRWHQWLDOLV WKH7DIHOOLQHV GDVKHGOLQHV KDYHEHHQLQWURGXFHGLQ6HFWLRQ,IWKHSRWHQWLDOLV
UDLVHG LQ DQRGLF GLUHFWLRQ IURP µ(FRUU¶ WKH SRODULVDWLRQ FXUYH DQG WKH RYHUSRWHQWLDO UDLVHG LQ DQRGLF GLUHFWLRQ IURP µ(FRUU¶ WKH SRODULVDWLRQ FXUYH DQG WKH RYHUSRWHQWLDO
FXUYHDSSURDFKHDFKRWKHUWREHFRPHLGHQWLFDODVPHWDOGLVVROXWLRQLVWKHRQO\DQRGLF FXUYHDSSURDFKHDFKRWKHUWREHFRPHLGHQWLFDODVPHWDOGLVVROXWLRQLVWKHRQO\DQRGLF
UHDFWLRQWDNLQJSODFH,QWKHILUVWOLQHDUSDUWWKHFXUUHQWGHQVLW\LQFUHDVHVFRUUHVSRQG UHDFWLRQWDNLQJSODFH,QWKHILUVWOLQHDUSDUWWKHFXUUHQWGHQVLW\LQFUHDVHVFRUUHVSRQG
LQJWRWKHVORSHRIWKH7DIHOOLQHLHFRQWUROOHGE\DFWLYDWLRQSRODULVDWLRQ:LWKIXU LQJWRWKHVORSHRIWKH7DIHOOLQHLHFRQWUROOHGE\DFWLYDWLRQSRODULVDWLRQ:LWKIXU
WKHULQFUHPHQWRIµ(¶WKHLQFUHDVHLQFXUUHQWGHQVLW\FHDVHVDQGWKHSRODULVDWLRQFXUYH WKHULQFUHPHQWRIµ(¶WKHLQFUHDVHLQFXUUHQWGHQVLW\FHDVHVDQGWKHSRODULVDWLRQFXUYH
VWDUWV WR GHYLDWH IURP WKH VORSH GHWHUPLQHG E\ DFWLYDWLRQ SRODULVDWLRQ 7KH FHDVH LQ VWDUWV WR GHYLDWH IURP WKH VORSH GHWHUPLQHG E\ DFWLYDWLRQ SRODULVDWLRQ 7KH FHDVH LQ
FXUUHQWLQFUHPHQWLVGXHWRWKHIDFWWKDWWKHKLJKFRUURVLRQUDWHVOHDGWRDKLJKFRQFHQ FXUUHQWLQFUHPHQWLVGXHWRWKHIDFWWKDWWKHKLJKFRUURVLRQUDWHVOHDGWRDKLJKFRQFHQ
WUDWLRQRIPHWDOLRQVDWWKHPHWDOHOHFWURO\WHLQWHUIDFH ZKLFKOHDGVWRFRQFHQWUDWLRQ WUDWLRQRIPHWDOLRQVDWWKHPHWDOHOHFWURO\WHLQWHUIDFH ZKLFKOHDGVWRFRQFHQWUDWLRQ
SRODULVDWLRQ LQFUHDVLQJ WKH HTXLOLEULXP SRWHQWLDO RI WKH GLVVROXWLRQ UHDFWLRQ FI 6HF SRODULVDWLRQ LQFUHDVLQJ WKH HTXLOLEULXP SRWHQWLDO RI WKH GLVVROXWLRQ UHDFWLRQ FI 6HF
WLRQ :LWKIXUWKHULQFUHPHQWRIWKHSRWHQWLDOWKHFULWLFDOFXUUHQWGHQVLW\µLFF¶LV WLRQ :LWKIXUWKHULQFUHPHQWRIWKHSRWHQWLDOWKHFULWLFDOFXUUHQWGHQVLW\µLFF¶LV
UHDFKHG7KHFULWLFDOFXUUHQWGHQVLW\µLFF¶LVWKHPD[LPXPFRUURVLRQFXUUHQWGHQVLW\RI UHDFKHG7KHFULWLFDOFXUUHQWGHQVLW\µLFF¶LVWKHPD[LPXPFRUURVLRQFXUUHQWGHQVLW\RI
WKHV\VWHPDWWKHSULPDU\SDVVLYDWLRQSRWHQWLDOµ(SS¶ LQWKHOLWHUDWXUHDOVRUHIHUUHGWR WKHV\VWHPDWWKHSULPDU\SDVVLYDWLRQSRWHQWLDOµ(SS¶ LQWKHOLWHUDWXUHDOVRUHIHUUHGWR
DVSDVVLYDWLRQSRWHQWLDO µ(SDVV¶ 7KLVLVIROORZHGE\DPDMRUGHFUHDVHLQWKHFXUUHQW DVSDVVLYDWLRQSRWHQWLDO µ(SDVV¶ 7KLVLVIROORZHGE\DPDMRUGHFUHDVHLQWKHFXUUHQW
GHQVLW\ZKLFKLVFDXVHGE\WKHIRUPDWLRQRIDSDVVLYHOD\HURQWKHPHWDOVXUIDFH FI GHQVLW\ZKLFKLVFDXVHGE\WKHIRUPDWLRQRIDSDVVLYHOD\HURQWKHPHWDOVXUIDFH FI

 

7KHPHDVXUHGGHYLDWLRQIURPWKH7DIHOOLQHLVQRUPDOO\ODUJHUWKDQWKHDFWXDORQHGXHWRWKHSRWHQWLDO 7KHPHDVXUHGGHYLDWLRQIURPWKH7DIHOOLQHLVQRUPDOO\ODUJHUWKDQWKHDFWXDORQHGXHWRWKHSRWHQWLDO
GURSEHWZHHQWKHUHIHUHQFHHOHFWURGHDQGWKHLQYHVWLJDWHGPHWDOVDPSOHDWWKHKLJKFXUUHQWGHQVLW\ GURSEHWZHHQWKHUHIHUHQFHHOHFWURGHDQGWKHLQYHVWLJDWHGPHWDOVDPSOHDWWKHKLJKFXUUHQWGHQVLW\
>%DUGDO@ >%DUGDO@

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ )RUPVRI&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ )RUPVRI&RUURVLRQ

6HFWLRQ   ,Q WKH SDVVLYH UHJLRQ WKH FXUUHQW UHPDLQV ORZ DW WKH DOPRVW FRQVWDQW 6HFWLRQ   ,Q WKH SDVVLYH UHJLRQ WKH FXUUHQW UHPDLQV ORZ DW WKH DOPRVW FRQVWDQW
SDVVLYHFXUUHQWGHQVLW\µLS¶ZKLFKLVJRYHUQHGE\WKHRKPLFUHVLVWDQFHRIWKHSDVVLYH SDVVLYHFXUUHQWGHQVLW\µLS¶ZKLFKLVJRYHUQHGE\WKHRKPLFUHVLVWDQFHRIWKHSDVVLYH
OD\HU LHLWVUHVLVWDQFHSRODULVDWLRQFI6HFWLRQ :LWKIXUWKHUSRWHQWLDOLQFUH OD\HU LHLWVUHVLVWDQFHSRODULVDWLRQFI6HFWLRQ :LWKIXUWKHUSRWHQWLDOLQFUH
PHQWFHUWDLQPHWDOVLQFHUWDLQHOHFWURO\WHVVKRZDWUDQVSDVVLYHUHJLRQZLWKLQFUHDVLQJ PHQWFHUWDLQPHWDOVLQFHUWDLQHOHFWURO\WHVVKRZDWUDQVSDVVLYHUHJLRQZLWKLQFUHDVLQJ
FXUUHQW GHQVLW\ EHIRUH DQRWKHU GHFUHDVH LQ WKH FXUUHQW GHQVLW\ LV PHDVXUHG ZKLFK LV FXUUHQW GHQVLW\ EHIRUH DQRWKHU GHFUHDVH LQ WKH FXUUHQW GHQVLW\ LV PHDVXUHG ZKLFK LV
UHIHUUHGWRDVVHFRQGDU\SDVVLYLW\2WKHUPHWDOVDQGRURWKHUHOHFWURO\WHVUHPDLQDWD UHIHUUHGWRDVVHFRQGDU\SDVVLYLW\2WKHUPHWDOVDQGRURWKHUHOHFWURO\WHVUHPDLQDWD
PRUHRUOHVVFRQVWDQWµLS¶XQWLOWUDQVSDVVLYLW\R[\JHQHYROXWLRQOHDGVWRDVKDUSULVHLQ PRUHRUOHVVFRQVWDQWµLS¶XQWLOWUDQVSDVVLYLW\R[\JHQHYROXWLRQOHDGVWRDVKDUSULVHLQ
WKHFXUUHQWGHQVLW\ WKHFXUUHQWGHQVLW\
%HVLGHVWKHDERYHPHQWLRQHGSDUDPHWHUVWKHSLWWLQJSRWHQWLDOµ(SLW¶ FI6HFWLRQ  %HVLGHVWKHDERYHPHQWLRQHGSDUDPHWHUVWKHSLWWLQJSRWHQWLDOµ(SLW¶ FI6HFWLRQ 
LVRIWHQXVHGDVDQDGGLWLRQDOFKDUDFWHULVWLFSDUDPHWHUIRUWKHTXDQWLILFDWLRQRIFRUUR LVRIWHQXVHGDVDQDGGLWLRQDOFKDUDFWHULVWLFSDUDPHWHUIRUWKHTXDQWLILFDWLRQRIFRUUR
VLRQLQLWLDWLRQLQSDUWLFXODULQHQYLURQPHQWVFRQWDLQLQJGHSDVVLYDWLQJLRQV VLRQLQLWLDWLRQLQSDUWLFXODULQHQYLURQPHQWVFRQWDLQLQJGHSDVVLYDWLQJLRQV

 )RUPVRI&RUURVLRQ  )RUPVRI&RUURVLRQ


%HIRUHLQWHUUHODWLRQVEHWZHHQWKHUPRG\QDPLFVDQGNLQHWLFVDUHGHDOWZLWKLQ6HFWLRQ %HIRUHLQWHUUHODWLRQVEHWZHHQWKHUPRG\QDPLFVDQGNLQHWLFVDUHGHDOWZLWKLQ6HFWLRQ
VHOHFWHGIRUPVRIDTXHRXVPHWDOOLFFRUURVLRQWKDWDUHUHOHYDQWLQWKHSUHVHQWWKHVLV VHOHFWHGIRUPVRIDTXHRXVPHWDOOLFFRUURVLRQWKDWDUHUHOHYDQWLQWKHSUHVHQWWKHVLV
DUHVXPPDULVHG0RUHGHWDLOHGGHVFULSWLRQVRIWKHVHDQGRWKHUIRUPVRIFRUURVLRQFDQ DUHVXPPDULVHG0RUHGHWDLOHGGHVFULSWLRQVRIWKHVHDQGRWKHUIRUPVRIFRUURVLRQFDQ
EHIRXQGLQWKHOLWHUDWXUHRQFRUURVLRQVFLHQFHHJ>.DHVFKH-RQHV%DU EHIRXQGLQWKHOLWHUDWXUHRQFRUURVLRQVFLHQFHHJ>.DHVFKH-RQHV%DU
GDO @ RU LQ WH[WERRNV RQ PDWHULDOV VFLHQFH RU UHODWHG VXEMHFWV HJ >&DOOLVWHU  GDO @ RU LQ WH[WERRNV RQ PDWHULDOV VFLHQFH RU UHODWHG VXEMHFWV HJ >&DOOLVWHU 
&DOOLVWHU0¡OOHUF@ &DOOLVWHU0¡OOHUF@

 8QLIRUPFRUURVLRQ  8QLIRUPFRUURVLRQ


8QLIRUP LQWKHOLWHUDWXUHDOVRUHIHUUHGWRDVJHQHUDO FRUURVLRQRFFXUVZKHQDQRGLF 8QLIRUP LQWKHOLWHUDWXUHDOVRUHIHUUHGWRDVJHQHUDO FRUURVLRQRFFXUVZKHQDQRGLF
DQGFDWKRGLFUHDFWLRQVWDNHSODFHRQWKHHQWLUHPHWDOVXUIDFHEXWQRWVLPXOWDQHRXVO\ DQGFDWKRGLFUHDFWLRQVWDNHSODFHRQWKHHQWLUHPHWDOVXUIDFHEXWQRWVLPXOWDQHRXVO\
DW WKH VDPH SODFH LH WKH DQRGLF DQG FDWKRGLF VLWHV FRQVWDQWO\ VKLIW SODFHV 7KDW UH DW WKH VDPH SODFH LH WKH DQRGLF DQG FDWKRGLF VLWHV FRQVWDQWO\ VKLIW SODFHV 7KDW UH
TXLUHVWKDWWKHUHDUHQRVLJQLILFDQWPDFURVFRSLFFRQFHQWUDWLRQGLIIHUHQFHVLQWKHHOHF TXLUHVWKDWWKHUHDUHQRVLJQLILFDQWPDFURVFRSLFFRQFHQWUDWLRQGLIIHUHQFHVLQWKHHOHF
WURO\WHDQGDORQJWKHPHWDOVXUIDFHRULQWHUPVRIUHLQIRUFHPHQWFRUURVLRQDWWKHFRQ WURO\WHDQGDORQJWKHPHWDOVXUIDFHRULQWHUPVRIUHLQIRUFHPHQWFRUURVLRQDWWKHFRQ
FUHWHVWHHOLQWHUIDFHDQG DORQJWKHVXUIDFHRIWKHUHLQIRUFHPHQW FI6HFWLRQVDQG FUHWHVWHHOLQWHUIDFHDQG DORQJWKHVXUIDFHRIWKHUHLQIRUFHPHQW FI6HFWLRQVDQG
  +HQFH XQLIRUP FRUURVLRQ LV UHODWLYHO\ HYHQO\ GLVWULEXWHG RYHU WKH VXUIDFH DQG   +HQFH XQLIRUP FRUURVLRQ LV UHODWLYHO\ HYHQO\ GLVWULEXWHG RYHU WKH VXUIDFH DQG
WKXVUHVXOWVLQDXQLIRUPWKLFNQHVVUHGXFWLRQ+RPRJHQHRXVPDWHULDOVZLWKRXWDVLJ WKXVUHVXOWVLQDXQLIRUPWKLFNQHVVUHGXFWLRQ+RPRJHQHRXVPDWHULDOVZLWKRXWDVLJ
QLILFDQWSDVVLYDWLRQWHQGHQF\LQWKHSUHVHQWHQYLURQPHQWDUHOLDEOHWRXQLIRUPFRUUR QLILFDQWSDVVLYDWLRQWHQGHQF\LQWKHSUHVHQWHQYLURQPHQWDUHOLDEOHWRXQLIRUPFRUUR
VLRQHJUHLQIRUFLQJVWHHOLQFDUERQDWHGFRQFUHWH FI6HFWLRQ  VLRQHJUHLQIRUFLQJVWHHOLQFDUERQDWHGFRQFUHWH FI6HFWLRQ 

 3LWWLQJFRUURVLRQ  3LWWLQJFRUURVLRQ


8QOLNH XQLIRUP FRUURVLRQ SLWWLQJ FRUURVLRQ LV ORFDOLVHG DQG FRUURVLRQ SLWV FDQ KDYH 8QOLNH XQLIRUP FRUURVLRQ SLWWLQJ FRUURVLRQ LV ORFDOLVHG DQG FRUURVLRQ SLWV FDQ KDYH
GLIIHUHQWVL]HVDQGGHSWKVDQGXVXDOO\DSSHDUUDQGRPO\GLVWULEXWHG,QWHUPVRIUHLQ GLIIHUHQWVL]HVDQGGHSWKVDQGXVXDOO\DSSHDUUDQGRPO\GLVWULEXWHG,QWHUPVRIUHLQ
IRUFHPHQWFRUURVLRQSLWWLQJFRUURVLRQLVJHQHUDOO\DVVRFLDWHGZLWKDQRWFKOLNHDWWDFN IRUFHPHQWFRUURVLRQSLWWLQJFRUURVLRQLVJHQHUDOO\DVVRFLDWHGZLWKDQRWFKOLNHDWWDFN
ZLWK D GHSWK HTXDO RU JUHDWHU WKDQ WKH VXUIDFH GLDPHWHU RI WKH QRWFK FI 6HFWLRQ ZLWK D GHSWK HTXDO RU JUHDWHU WKDQ WKH VXUIDFH GLDPHWHU RI WKH QRWFK FI 6HFWLRQ
 3LWWLQJEHJLQVZKHQVXUIDFH RULQWHUIDFH GHIHFWVFHUWDLQSDUWLFOHVRURWKHU  3LWWLQJEHJLQVZKHQVXUIDFH RULQWHUIDFH GHIHFWVFHUWDLQSDUWLFOHVRURWKHU
YDULDWLRQVLQWKHPHWDO RULQWHUIDFH OHDGWRDIL[DWLRQRIDQRGLFDQGFDWKRGLFVLWHVRQ YDULDWLRQVLQWKHPHWDO RULQWHUIDFH OHDGWRDIL[DWLRQRIDQRGLFDQGFDWKRGLFVLWHVRQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


)RUPVRI&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ )RUPVRI&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ

WKHPHWDOVXUIDFH FI6HFWLRQVDQG 7KHQDWXUHRISLWWLQJRIWHQPDNHVLWGLIIL WKHPHWDOVXUIDFH FI6HFWLRQVDQG 7KHQDWXUHRISLWWLQJRIWHQPDNHVLWGLIIL


FXOWWRHVWLPDWHWKHDPRXQWRIGDPDJH$VLQGLFDWHGLQ6HFWLRQSLWWLQJFDQEH FXOWWRHVWLPDWHWKHDPRXQWRIGDPDJH$VLQGLFDWHGLQ6HFWLRQSLWWLQJFDQEH
DVVRFLDWHG ZLWK D SUHPDWXUH EUHDNGRZQ RI SDVVLYLW\ 7KH HOHFWURGH SRWHQWLDO ZKHUH DVVRFLDWHG ZLWK D SUHPDWXUH EUHDNGRZQ RI SDVVLYLW\ 7KH HOHFWURGH SRWHQWLDO ZKHUH
WKHEUHDNGRZQRIWKHSDVVLYHOD\HUVRFFXUVLVFRPPRQO\UHIHUUHGWRDVSLWWLQJSRWHQ WKHEUHDNGRZQRIWKHSDVVLYHOD\HUVRFFXUVLVFRPPRQO\UHIHUUHGWRDVSLWWLQJSRWHQ
WLDOµ(SLW¶VHH)LJXUH>$@ WLDOµ(SLW¶VHH)LJXUH>$@

 
)LJXUH >$@ $QRGLFSRODULVDWLRQFXUYHIRUDQDFWLYHSDVVLYHPHWDOLQDQHQYL )LJXUH >$@ $QRGLFSRODULVDWLRQFXUYHIRUDQDFWLYHSDVVLYHPHWDOLQDQHQYL
URQPHQW FDXVLQJ SLWWLQJ FRUURVLRQ µ(SLW¶ SLWWLQJ SRWHQWLDO µ(SS¶ SUL URQPHQW FDXVLQJ SLWWLQJ FRUURVLRQ µ(SLW¶ SLWWLQJ SRWHQWLDO µ(SS¶ SUL
PDU\ SDVVLYDWLRQ SRWHQWLDO µLS¶ SDVVLYH FXUUHQW GHQVLW\ DQG µLFF¶ PDU\ SDVVLYDWLRQ SRWHQWLDO µLS¶ SDVVLYH FXUUHQW GHQVLW\ DQG µLFF¶
FULWLFDOFXUUHQWGHQVLW\ FI6HFWLRQ $IWHU>%DUGDO@ >%@ FULWLFDOFXUUHQWGHQVLW\ FI6HFWLRQ $IWHU>%DUGDO@ >%@
3RWHQWLRG\QDPLF DQRGLF SRODULVDWLRQ FXUYHV VFDQ UDWH   P9V  RI 3RWHQWLRG\QDPLF DQRGLF SRODULVDWLRQ FXUYHV VFDQ UDWH   P9V  RI
FDUERQ VWHHO LQ VDWXUDWHG &D 2+  VROXWLRQ FRQWDLQLQJ YDULRXV SHU FDUERQ VWHHO LQ VDWXUDWHG &D 2+  VROXWLRQ FRQWDLQLQJ YDULRXV SHU
FHQWDJHVRI&D&O$IWHU>3DJH 7UHDGDZD\@ FHQWDJHVRI&D&O$IWHU>3DJH 7UHDGDZD\@
3LWWLQJFRUURVLRQRFFXUVRQPRUHRUOHVVSDVVLYDWHGPHWDOVLQHQYLURQPHQWVFRQWDLQLQJ 3LWWLQJFRUURVLRQRFFXUVRQPRUHRUOHVVSDVVLYDWHGPHWDOVLQHQYLURQPHQWVFRQWDLQLQJ
GHSDVVLYDWLQJLRQVDPRQJRWKHUVFKORULGHLRQV FI6HFWLRQ )RULQVWDQFHFDU GHSDVVLYDWLQJLRQVDPRQJRWKHUVFKORULGHLRQV FI6HFWLRQ )RULQVWDQFHFDU
ERQ VWHHO LQ FKORULGH FRQWDPLQDWHG FRQFUHWH RU VWDLQOHVV VWHHO LQ HQYLURQPHQWV ZLWK ERQ VWHHO LQ FKORULGH FRQWDPLQDWHG FRQFUHWH RU VWDLQOHVV VWHHO LQ HQYLURQPHQWV ZLWK
KLJKHUFKORULGHFRQWHQWVDUHVXVFHSWLEOHWRSLWWLQJ$VVKRZQLQ)LJXUH>%@µ(SLW¶ KLJKHUFKORULGHFRQWHQWVDUHVXVFHSWLEOHWRSLWWLQJ$VVKRZQLQ)LJXUH>%@µ(SLW¶
GHFUHDVHVGUDVWLFDOO\ZLWKLQFUHDVLQJFRQFHQWUDWLRQRIGHSDVVLYDWLQJLRQVLQWKLVFDVH GHFUHDVHVGUDVWLFDOO\ZLWKLQFUHDVLQJFRQFHQWUDWLRQRIGHSDVVLYDWLQJLRQVLQWKLVFDVH
&D&O>3DJH 7UHDGDZD\@,WVKRXOGEHHPSKDVLVHGWKDWµ(SLW¶LVQRWDWKHUPR &D&O>3DJH 7UHDGDZD\@,WVKRXOGEHHPSKDVLVHGWKDWµ(SLW¶LVQRWDWKHUPR
G\QDPLF SDUDPHWHU EXW UDWKHU D NLQHWLF RQH $PRQJ RWKHUV WKLV LV VXVWDLQHG E\ WKH G\QDPLF SDUDPHWHU EXW UDWKHU D NLQHWLF RQH $PRQJ RWKHUV WKLV LV VXVWDLQHG E\ WKH
IDFWWKDWµ(SLW¶LVODUJHO\DIIHFWHGE\WKHVFDQUDWH LQWKHOLWHUDWXUHDOVRUHIHUUHGWRDV IDFWWKDWµ(SLW¶LVODUJHO\DIIHFWHGE\WKHVFDQUDWH LQWKHOLWHUDWXUHDOVRUHIHUUHGWRDV
VZHHSUDWH XVHGWRUHFRUGWKHSRODULVDWLRQFXUYH FI6HFWLRQ  VZHHSUDWH XVHGWRUHFRUGWKHSRODULVDWLRQFXUYH FI6HFWLRQ 

 *DOYDQLF&RUURVLRQ  *DOYDQLF&RUURVLRQ


*DOYDQLFFRUURVLRQWDNHVSODFHLIDPHWDOOLFFRQWDFWLVPDGHEHWZHHQ DQREOHUDQGD *DOYDQLFFRUURVLRQWDNHVSODFHLIDPHWDOOLFFRQWDFWLVPDGHEHWZHHQ DQREOHUDQGD
OHVVQREOHPHWDO FI&KDSWHUµ7D'¶ XQGHUWKHFRQGLWLRQWKDWWKHUHDOVRLVDQHOHFWUR OHVVQREOHPHWDO FI&KDSWHUµ7D'¶ XQGHUWKHFRQGLWLRQWKDWWKHUHDOVRLVDQHOHFWUR
O\WLFFRQQHFWLRQEHWZHHQWKHPHWDOVVRWKDWDFORVHGFLUFXLWLHDJDOYDQLFFHOOLVHV O\WLFFRQQHFWLRQEHWZHHQWKHPHWDOVVRWKDWDFORVHGFLUFXLWLHDJDOYDQLFFHOOLVHV
WDEOLVKHG,Iµ¨(¶EHWZHHQWZRPHWDOVLQDJDOYDQLFFHOOLVODUJHWKHQREOHUPHWDOGRHV WDEOLVKHG,Iµ¨(¶EHWZHHQWZRPHWDOVLQDJDOYDQLFFHOOLVODUJHWKHQREOHUPHWDOGRHV
JHQHUDOO\QRWWDNHSDUWLQWKHFRUURVLRQSURFHVVZLWKLWVRZQLRQV8QGHUWKLVFRQGL JHQHUDOO\QRWWDNHSDUWLQWKHFRUURVLRQSURFHVVZLWKLWVRZQLRQV8QGHUWKLVFRQGL
WLRQµ(¶RIWKHQREOHUPHWDOGRHVQRWSOD\DQ\UROH>%DUGDO@$VPHQWLRQHGLQ WLRQµ(¶RIWKHQREOHUPHWDOGRHVQRWSOD\DQ\UROH>%DUGDO@$VPHQWLRQHGLQ
6HFWLRQ  WKH (0) VHULHV DOORZV RQO\ SUHOLPLQDU\ FRQFOXVLRQV DERXW SUHIHUHQ 6HFWLRQ  WKH (0) VHULHV DOORZV RQO\ SUHOLPLQDU\ FRQFOXVLRQV DERXW SUHIHUHQ
WLDOO\FRUURGHGPHWDODQG FRQFOXVLYHLQIRUPDWLRQFDQRQO\EHREWDLQHGIURPWKHJDO WLDOO\FRUURGHGPHWDODQG FRQFOXVLYHLQIRUPDWLRQFDQRQO\EHREWDLQHGIURPWKHJDO

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ )RUPVRI&RUURVLRQ $TXHRXV0HWDOOLF&RUURVLRQ )RUPVRI&RUURVLRQ

YDQLFVHULHVIRUWKHSDUWLFXODUHQYLURQPHQWXQGHULQYHVWLJDWLRQ)RULQVWDQFHWKHJDO YDQLFVHULHVIRUWKHSDUWLFXODUHQYLURQPHQWXQGHULQYHVWLJDWLRQ)RULQVWDQFHWKHJDO
YDQLF VHULHV IRU VHDZDWHU ZKLFK LV RIWHQ SURYLGHG LQ WKH FRUURVLRQ OLWHUDWXUH HJ YDQLF VHULHV IRU VHDZDWHU ZKLFK LV RIWHQ SURYLGHG LQ WKH FRUURVLRQ OLWHUDWXUH HJ
>-RQHV  %DUGDO @ GRHV QRW DOORZ FRQFOXVLRQ DERXW WKH EHKDYLRXU RI HJ >-RQHV  %DUGDO @ GRHV QRW DOORZ FRQFOXVLRQ DERXW WKH EHKDYLRXU RI HJ
FHUWDLQ PHWDOV LQ FDUERQDWHG DQG FKORULGH FRQWDPLQDWHG FRQFUHWH  7KH FRPSOH[ FHUWDLQ PHWDOV LQ FDUERQDWHG DQG FKORULGH FRQWDPLQDWHG FRQFUHWH  7KH FRPSOH[
FKHPLFDOHQYLURQPHQWRIFRQFUHWH FI6HFWLRQ LQWHUDFWVZLWKWKHWKHUPRG\QDPLFV FKHPLFDOHQYLURQPHQWRIFRQFUHWH FI6HFWLRQ LQWHUDFWVZLWKWKHWKHUPRG\QDPLFV
VRWKDWQRWRQO\WKHS+DQGWKHFKORULGHFRQWHQWSOD\DUROH)RULQVWDQFHWKLVDVSHFWLV VRWKDWQRWRQO\WKHS+DQGWKHFKORULGHFRQWHQWSOD\DUROH)RULQVWDQFHWKLVDVSHFWLV
HYLGHQWLQWKHWKHUPRG\QDPLFLQWHUDFWLRQEHWZHHQFDOFLXPDQGPDJQHVLXP FI6HF HYLGHQWLQWKHWKHUPRG\QDPLFLQWHUDFWLRQEHWZHHQFDOFLXPDQGPDJQHVLXP FI6HF
WLRQ  WLRQ 

 &UHYLFH&RUURVLRQ  &UHYLFH&RUURVLRQ


&UHYLFH FRUURVLRQ LV D VSHFLDOLVHG IRUP RI SLWWLQJ FRUURVLRQ WKDW SDUWLFXODUO\ DWWDFNV &UHYLFH FRUURVLRQ LV D VSHFLDOLVHG IRUP RI SLWWLQJ FRUURVLRQ WKDW SDUWLFXODUO\ DWWDFNV
PHWDOVRUDOOR\VZKLFKDUHSURWHFWHGE\SDVVLYHOD\HUV&UHYLFHFRUURVLRQUHVXOWVIURP PHWDOVRUDOOR\VZKLFKDUHSURWHFWHGE\SDVVLYHOD\HUV&UHYLFHFRUURVLRQUHVXOWVIURP
DUHODWLYHODFNRIR[\JHQLQD FUHYLFH ZKHUHWKHPHWDOEHFRPHVDQRGLFWRZDUGVWKH DUHODWLYHODFNRIR[\JHQLQD FUHYLFH ZKHUHWKHPHWDOEHFRPHVDQRGLFWRZDUGVWKH
PHWDORXWVLGHWKHFUHYLFH&RUURVLRQFDQWDNHSODFHLIWKHFUHYLFHLVODUJHHQRXJKWR PHWDORXWVLGHWKHFUHYLFH&RUURVLRQFDQWDNHSODFHLIWKHFUHYLFHLVODUJHHQRXJKWR
DGPLWWKHHOHFWURO\WHEXWVPDOOHQRXJKWRVXIIHUIURPR[\JHQGHSOHWLRQ DGPLWWKHHOHFWURO\WHEXWVPDOOHQRXJKWRVXIIHUIURPR[\JHQGHSOHWLRQ

 ,QWHUJUDQXODU&RUURVLRQ  ,QWHUJUDQXODU&RUURVLRQ


,QWHUJUDQXODU LQWKHOLWHUDWXUHDOVRUHIHUUHGWRDVLQWHUFU\VWDOOLQH FRUURVLRQFDQRFFXU ,QWHUJUDQXODU LQWKHOLWHUDWXUHDOVRUHIHUUHGWRDVLQWHUFU\VWDOOLQH FRUURVLRQFDQRFFXU
EHWZHHQWKHJUDLQV LQWKHOLWHUDWXUHDOVRUHIHUUHGWRDVFU\VWDOV WKDWDUHIRUPHGGXULQJ EHWZHHQWKHJUDLQV LQWKHOLWHUDWXUHDOVRUHIHUUHGWRDVFU\VWDOV WKDWDUHIRUPHGGXULQJ
WKHVROLGLILFDWLRQRIDPHWDO7KHFRPSRVLWLRQRIWKHDUHDVEHWZHHQWKHJUDLQVGLIIHUV WKHVROLGLILFDWLRQRIDPHWDO7KHFRPSRVLWLRQRIWKHDUHDVEHWZHHQWKHJUDLQVGLIIHUV
IURPWKHRQHRIWKHJUDLQVWKHPVHOYHVDQGWKHVHERXQGDULHVDUHRIWHQVXEMHFWHGWRLQ IURPWKHRQHRIWKHJUDLQVWKHPVHOYHVDQGWKHVHERXQGDULHVDUHRIWHQVXEMHFWHGWRLQ
WHUJUDQXODUFRUURVLRQ*UDLQVDQGJUDLQERXQGDULHVLQFDUERQVWHHODUHGLVFXVVHGLQGH WHUJUDQXODUFRUURVLRQ*UDLQVDQGJUDLQERXQGDULHVLQFDUERQVWHHODUHGLVFXVVHGLQGH
WDLOLQ6HFWLRQ*UDLQVDQGJUDLQERXQGDULHVLQVWDLQOHVVVWHHOZKLFKDUHNQRZQ WDLOLQ6HFWLRQ*UDLQVDQGJUDLQERXQGDULHVLQVWDLQOHVVVWHHOZKLFKDUHNQRZQ
WREHSDUWLFXODUO\VHQVLWLYHWRLQWHUJUDQXODUFRUURVLRQLQWKHYLFLQLW\RIZHOGVDUHGHDOW WREHSDUWLFXODUO\VHQVLWLYHWRLQWHUJUDQXODUFRUURVLRQLQWKHYLFLQLW\RIZHOGVDUHGHDOW
ZLWKLQ6HFWLRQ ZLWKLQ6HFWLRQ

 +\GURJHQ(PEULWWOHPHQW  +\GURJHQ(PEULWWOHPHQW


,QSULQFLSOHK\GURJHQHPEULWWOHPHQWLVQRWDQDFWXDOIRUPRIPHWDOOLFFRUURVLRQEXW ,QSULQFLSOHK\GURJHQHPEULWWOHPHQWLVQRWDQDFWXDOIRUPRIPHWDOOLFFRUURVLRQEXW
UDWKHU D SRVVLEO\ KDUPIXO UHVXOW RI PHWDOOLF FRUURVLRQ UHDFWLRQV ,W LV LQWHUFRQQHFWHG UDWKHU D SRVVLEO\ KDUPIXO UHVXOW RI PHWDOOLF FRUURVLRQ UHDFWLRQV ,W LV LQWHUFRQQHFWHG
ZLWKFRUURVLRQPHFKDQLVPVDQGDQLPSRUWDQWDVSHFWWKDWZHWRRNLQWRGXHFRQVLGHUD ZLWKFRUURVLRQPHFKDQLVPVDQGDQLPSRUWDQWDVSHFWWKDWZHWRRNLQWRGXHFRQVLGHUD
WLRQ LQ SDUWLFXODU LQ WKH GHVLJQ RI QHZ FRXQWHUPHDVXUHV FI &KDSWHU   7KXV LW LV WLRQ LQ SDUWLFXODU LQ WKH GHVLJQ RI QHZ FRXQWHUPHDVXUHV FI &KDSWHU   7KXV LW LV
EULHIO\GHVFULEHGLQWKLV6HFWLRQ EULHIO\GHVFULEHGLQWKLV6HFWLRQ
+\GURJHQHPEULWWOHPHQWUHVXOWVIURPGLIIXVLRQRIK\GURJHQDWRPVLQWRWKHPHWDO7KH +\GURJHQHPEULWWOHPHQWUHVXOWVIURPGLIIXVLRQRIK\GURJHQDWRPVLQWRWKHPHWDO7KH
K\GURJHQ DWRPV UHFRPELQH LQ WKH PLQXVFXOH YRLGV RI WKH PHWDO PDWUL[ WR K\GURJHQ K\GURJHQ DWRPV UHFRPELQH LQ WKH PLQXVFXOH YRLGV RI WKH PHWDO PDWUL[ WR K\GURJHQ
PROHFXOHV DQG FUHDWH SUHVVXUH IURP LQVLGH WKH FDYLW\ 7KLV SUHVVXUH FDQ LQFUHDVH WR PROHFXOHV DQG FUHDWH SUHVVXUH IURP LQVLGH WKH FDYLW\ 7KLV SUHVVXUH FDQ LQFUHDVH WR
OHYHOV WKDW UHGXFH WKH GXFWLOLW\ DQG WHQVLOH VWUHQJWK RI WKH PHWDO DQG FDQ HYHQWXDOO\ OHYHOV WKDW UHGXFH WKH GXFWLOLW\ DQG WHQVLOH VWUHQJWK RI WKH PHWDO DQG FDQ HYHQWXDOO\
OHDGWRWKHVRFDOOHGK\GURJHQLQGXFHGFUDFNLQJ $PRQJRWKHUPHWDOVKLJKVWUHQJWK OHDGWRWKHVRFDOOHGK\GURJHQLQGXFHGFUDFNLQJ $PRQJRWKHUPHWDOVKLJKVWUHQJWK
 

7KHJDOYDQLFVHULHVLQVHDZDWHUFDQHYHQEHPLVOHDGLQJLQVXSSRVHGO\HTXLYDOHQWHQYLURQPHQWVHJ 7KHJDOYDQLFVHULHVLQVHDZDWHUFDQHYHQEHPLVOHDGLQJLQVXSSRVHGO\HTXLYDOHQWHQYLURQPHQWVHJ
GXHWRWKHGLIIHUHQWEHKDYLRXURIFHUWDLQPHWDOVLQVLPXODWHGDQGLQDFWXDOVHDZDWHU GXHWRWKHGLIIHUHQWEHKDYLRXURIFHUWDLQPHWDOVLQVLPXODWHGDQGLQDFWXDOVHDZDWHU

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


,QWHUUHODWLRQVEHWZHHQ7KHUPRG\QDPLFVDQG.LQHWLFV $TXHRXV0HWDOOLF&RUURVLRQ ,QWHUUHODWLRQVEHWZHHQ7KHUPRG\QDPLFVDQG.LQHWLFV $TXHRXV0HWDOOLF&RUURVLRQ

VWHHOVDUHNQRZQWREHSDUWLFXODUO\VXVFHSWLEOHWRK\GURJHQHPEULWWOHPHQW+\GURJHQ VWHHOVDUHNQRZQWREHSDUWLFXODUO\VXVFHSWLEOHWRK\GURJHQHPEULWWOHPHQW+\GURJHQ
HPEULWWOHPHQW FDQ RFFXU GXULQJ GLIIHUHQW VWDJHV RI PDQXIDFWXULQJ RU RSHUDWLRQ HJ HPEULWWOHPHQW FDQ RFFXU GXULQJ GLIIHUHQW VWDJHV RI PDQXIDFWXULQJ RU RSHUDWLRQ HJ
FDXVHGE\µ&3¶DQGRUJDOYDQLFFRXSOLQJZKLFKDUHFHQWUDOSDUDPHWHUVLQRXUGHVLJQ FDXVHGE\µ&3¶DQGRUJDOYDQLFFRXSOLQJZKLFKDUHFHQWUDOSDUDPHWHUVLQRXUGHVLJQ
DSSURDFKWRQHZFRXQWHUPHDVXUHV DSSURDFKWRQHZFRXQWHUPHDVXUHV

 ,QWHUUHODWLRQVEHWZHHQ7KHUPRG\QDPLFVDQG.LQHWLFV  ,QWHUUHODWLRQVEHWZHHQ7KHUPRG\QDPLFVDQG.LQHWLFV


,Q6HFWLRQVDQGWKHLPSRUWDQFHRIWKHUPRG\QDPLFDQGNLQHWLFSDUDPHWHUVIRU ,Q6HFWLRQVDQGWKHLPSRUWDQFHRIWKHUPRG\QDPLFDQGNLQHWLFSDUDPHWHUVIRU
WKHXQGHUVWDQGLQJDQGGHVFULSWLRQRIFRUURVLRQSURFHVVHVZDVLOOXVWUDWHGDQGWKHLQWHU WKHXQGHUVWDQGLQJDQGGHVFULSWLRQRIFRUURVLRQSURFHVVHVZDVLOOXVWUDWHGDQGWKHLQWHU
UHODWLRQV EHWZHHQ WKH WZR DSSURDFKHV ZHUH LQGLFDWHG $ FRQYHQLHQW DQG LOOXVWUDWLYH UHODWLRQV EHWZHHQ WKH WZR DSSURDFKHV ZHUH LQGLFDWHG $ FRQYHQLHQW DQG LOOXVWUDWLYH
ZD\ RI SUHVHQWLQJ WKHVH LQWHUUHODWLRQV LV WKH FRPSDULVRQ RI 3RXUEDL[ GLDJUDPV ZLWK ZD\ RI SUHVHQWLQJ WKHVH LQWHUUHODWLRQV LV WKH FRPSDULVRQ RI 3RXUEDL[ GLDJUDPV ZLWK
SRODULVDWLRQFXUYHVVLQFHERWKLGHQWLI\GRPDLQVRILPPXQLW\FRUURVLRQDQGSDVVLY SRODULVDWLRQFXUYHVVLQFHERWKLGHQWLI\GRPDLQVRILPPXQLW\FRUURVLRQDQGSDVVLY
LW\VHH)LJXUH LW\VHH)LJXUH

 
)LJXUH &RPSDULVRQ RI3RXUEDL[GLDJUDPDQG VHOHFWHGSRODULVDWLRQFXUYHVWR )LJXUH &RPSDULVRQRI3RXUEDL[GLDJUDPDQG VHOHFWHGSRODULVDWLRQFXUYHVWR
LOOXVWUDWH LQWHUUHODWLRQV EHWZHHQ WKHUPRG\QDPLFV DQG NLQHWLFV $IWHU LOOXVWUDWH LQWHUUHODWLRQV EHWZHHQ WKHUPRG\QDPLFV DQG NLQHWLFV $IWHU
FRPELQHGLQIRUPDWLRQIURP>3RXUEDL[D0¡OOHUE%DUGDO FRPELQHGLQIRUPDWLRQIURP>3RXUEDL[D0¡OOHUE%DUGDO
 .$,67 @ 7KH GLVWLQJXLVKHG UHJLRQV LQ WKH 3RXUEDL[ GLD  .$,67 @ 7KH GLVWLQJXLVKHG UHJLRQV LQ WKH 3RXUEDL[ GLD
JUDP DQG WKH SRODULVDWLRQ FXUYHV DUH LQGLFDWHG E\ WKH GDVKHG OLQHV JUDP DQG WKH SRODULVDWLRQ FXUYHV DUH LQGLFDWHG E\ WKH GDVKHG OLQHV
DQGWKHGRWWHGDQGGDVKHGOLQHIRUµ(SLW¶ DQGLQGH[HGLQWKH\HO DQGWKHGRWWHGDQGGDVKHGOLQHIRUµ(SLW¶ DQGLQGH[HGLQWKH\HO
ORZ FLUFOHV ZKLFK LV UHIHUUHG WR LQ 7DEOH  >$@ )H+2 3RXUEDL[ ORZ FLUFOHV ZKLFK LV UHIHUUHG WR LQ 7DEOH  >$@ )H+2 3RXUEDL[
EDVHGRQ7DEOHDQG)HLD íPRO/ FI)LJXUH 7KHVHOHFWHG EDVHGRQ7DEOHDQG)HLD íPRO/ FI)LJXUH 7KHVHOHFWHG
S+ RI IRU WKH HVWDEOLVKPHQW RISRODULVDWLRQ FXUYHV LV PDUNHGE\WKH S+ RI IRU WKH HVWDEOLVKPHQW RISRODULVDWLRQ FXUYHV LV PDUNHGE\WKH
UHGEOXH GDVKHG OLQH DQG D K\SRWKHWLFDO SLWWLQJ SRWHQWLDO µ(SLW¶ LV UHGEOXH GDVKHG OLQH DQG D K\SRWKHWLFDO SLWWLQJ SRWHQWLDO µ(SLW¶ LV
PDUNHG E\ WKH EOXH OLQH >%@ 4XDOLWDWLYH SRODULVDWLRQ FXUYH IRU SDV PDUNHG E\ WKH EOXH OLQH >%@ 4XDOLWDWLYH SRODULVDWLRQ FXUYH IRU SDV
VLYDWLRQZLWKRXWSUHPDWXUHGHSDVVLYDWLRQ>&@4XDOLWDWLYHSRODULVDWLRQ VLYDWLRQZLWKRXWSUHPDWXUHGHSDVVLYDWLRQ>&@4XDOLWDWLYHSRODULVDWLRQ
FXUYHIRUSUHPDWXUHGHSDVVLYDWLRQLQUHODWLRQWRWKHK\SRWKHWLFDOµ(SLW¶ FXUYHIRUSUHPDWXUHGHSDVVLYDWLRQLQUHODWLRQWRWKHK\SRWKHWLFDOµ(SLW¶
LQ>$@  LQ>$@ 
7RSURYLGHDGGLWLRQDOLQIRUPDWLRQWR)LJXUHWKHUHOHYDQWDQRGLFDQGFDWKRGLFKDOI 7RSURYLGHDGGLWLRQDOLQIRUPDWLRQWR)LJXUHWKHUHOHYDQWDQRGLFDQGFDWKRGLFKDOI
FHOOUHDFWLRQVDQGWKHLUGLUHFWLRQLHUHGXFWLRQRUR[LGDWLRQ DVZULWWHQRUUHYHUVHGFI FHOOUHDFWLRQVDQGWKHLUGLUHFWLRQLHUHGXFWLRQRUR[LGDWLRQ DVZULWWHQRUUHYHUVHGFI
6HFWLRQ DVVRFLDWHGZLWKWKHUHJLRQVWR LQGLFDWHGE\WKH \HOORZFLUFOHVLQ 6HFWLRQ DVVRFLDWHGZLWKWKHUHJLRQVWR LQGLFDWHGE\WKH \HOORZFLUFOHVLQ
)LJXUH DUHOLVWHGLQ7DEOH )LJXUH DUHOLVWHGLQ7DEOH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ ,QWHUUHODWLRQVEHWZHHQ7KHUPRG\QDPLFVDQG.LQHWLFV $TXHRXV0HWDOOLF&RUURVLRQ ,QWHUUHODWLRQVEHWZHHQ7KHUPRG\QDPLFVDQG.LQHWLFV

7DEOH +DOIFHOO UHDFWLRQV DVVRFLDWHG HTXLOLEULXP SRWHQWLDOV DQG UHDFWLRQ GL 7DEOH +DOIFHOO UHDFWLRQV DVVRFLDWHG HTXLOLEULXP SRWHQWLDOV DQG UHDFWLRQ GL
UHFWLRQV UHGXFWLRQDVZULWWHQR[LGDWLRQ EROG UHYHUVHG FRUUHVSRQG UHFWLRQV UHGXFWLRQDVZULWWHQR[LGDWLRQ EROG UHYHUVHG FRUUHVSRQG
LQJWRWKHHVVHQWLDOUHJLRQVLGHQWLILHGLQWKH3RXUEDL[GLDJUDP DQG WKH LQJWRWKHHVVHQWLDOUHJLRQVLGHQWLILHGLQWKH3RXUEDL[GLDJUDP DQG WKH
SRODULVDWLRQFXUYHVIRUWKHVHOHFWHGS+RIE\WKH\HOORZFLUFOHVLQ)LJ SRODULVDWLRQFXUYHVIRUWKHVHOHFWHGS+RIE\WKH\HOORZFLUFOHVLQ)LJ
XUH XUH
+DOIFHOOUHDFWLRQ +DOIFHOOUHDFWLRQ
5HJLRQ 5HJLRQ
, ,, ,,, ,9 , ,, ,,, ,9
 5HGXFWLRQ 5HGXFWLRQ 5HGXFWLRQ 5HGXFWLRQ  5HGXFWLRQ 5HGXFWLRQ 5HGXFWLRQ 5HGXFWLRQ
 2[LGDWLRQ 5HGXFWLRQ 5HGXFWLRQ 5HGXFWLRQ  2[LGDWLRQ 5HGXFWLRQ 5HGXFWLRQ 5HGXFWLRQ
 2[LGDWLRQ 5HGXFWLRQ 5HGXFWLRQ 2[LGDWLRQ  2[LGDWLRQ 5HGXFWLRQ 5HGXFWLRQ 2[LGDWLRQ
 2[LGDWLRQ 2[LGDWLRQ 5HGXFWLRQ 2[LGDWLRQ  2[LGDWLRQ 2[LGDWLRQ 5HGXFWLRQ 2[LGDWLRQ
 2[LGDWLRQ 2[LGDWLRQ 2[LGDWLRQ 2[LGDWLRQ  2[LGDWLRQ 2[LGDWLRQ 2[LGDWLRQ 2[LGDWLRQ
$QRGLFUHDFWLRQV $QRGLFUHDFWLRQV
, )H + −
+ H → )H (( 
 −  {−} P96+( )  , )H + −
+ H → )H (( 
 −  {−} P96+( ) 
,,
+
)H 2 + + + H → )H − +
+ +  2 (( 
 =  P96+( )  ,, )H 2 + + + H → )H + + +  2
+ −
(( 
 =  P96+( ) 
&DWKRGLFUHDFWLRQV &DWKRGLFUHDFWLRQV
,,, 2 + + + + H − → +  2 ( (  =  {} P96+( )  ,,, 2 + + + + H − → +  2 (( 
 =  {} P96+( ) 
,9 + + + H− → +  (( 
 =  P96+( )  ,9 + + + H− → +  (( 
 =  P96+( ) 
 
7KHWKHRU\IRUWKHHVWDEOLVKPHQWRIWKH3RXUEDL[GLDJUDPZKLFKZDVGHVFULEHGLQGH 7KHWKHRU\IRUWKHHVWDEOLVKPHQWRIWKH3RXUEDL[GLDJUDPZKLFKZDVGHVFULEHGLQGH
WDLOLQ6HFWLRQFDQEHVXPPDULVHGIRUWKHVHOHFWHGS+RIE\)LJXUH>$@ WDLOLQ6HFWLRQFDQEHVXPPDULVHGIRUWKHVHOHFWHGS+RIE\)LJXUH>$@
DQGWKHLQIRUPDWLRQJLYHQLQ7DEOH7KHDQRGLFEUDQFKRIWKHTXDOLWDWLYHSRODULVD DQGWKHLQIRUPDWLRQJLYHQLQ7DEOH7KHDQRGLFEUDQFKRIWKHTXDOLWDWLYHSRODULVD
WLRQ FXUYH ZLWKRXW GHSDVVLYDWLRQ LQ )LJXUH  >%@ UHIOHFWV SDVVLYDWLRQ ZKLFK LV IRU WLRQ FXUYH ZLWKRXW GHSDVVLYDWLRQ LQ )LJXUH  >%@ UHIOHFWV SDVVLYDWLRQ ZKLFK LV IRU
VHOHFWHGS+RIPDLQO\FKDUDFWHULVHGE\WKHWKHUPRG\QDPLFVWDELOLW\RIWKHSDVVLYH VHOHFWHGS+RIPDLQO\FKDUDFWHULVHGE\WKHWKHUPRG\QDPLFVWDELOLW\RIWKHSDVVLYH
R[LGH )H2 FI 6HFWLRQ   7KH GUDVWLF HIIHFW RI GHSDVVLYDWLQJ LRQV LQ D FHUWDLQ R[LGH )H2 FI 6HFWLRQ   7KH GUDVWLF HIIHFW RI GHSDVVLYDWLQJ LRQV LQ D FHUWDLQ
WKUHVKROG FRQFHQWUDWLRQZKLFKLVUHSUHVHQWHGE\DK\SRWKHWLFDOµ(SLW¶LQWKH3RXUEDL[ WKUHVKROG FRQFHQWUDWLRQZKLFKLVUHSUHVHQWHGE\DK\SRWKHWLFDOµ(SLW¶LQWKH3RXUEDL[
GLDJUDPRQWKHSRODULVDWLRQFXUYHLVLOOXVWUDWHGE\WKHSUHPDWXUHVKDUSULVHLQFRUUR GLDJUDPRQWKHSRODULVDWLRQFXUYHLVLOOXVWUDWHGE\WKHSUHPDWXUHVKDUSULVHLQFRUUR
VLRQFXUUHQWDVLQGLFDWHGLQ)LJXUH>&@ FI6HFWLRQ %HVLGHVWKRVHIHDWXUHV VLRQFXUUHQWDVLQGLFDWHGLQ)LJXUH>&@ FI6HFWLRQ %HVLGHVWKRVHIHDWXUHV
RWKHULPSRUWDQWNLQHWLFDVSHFWVVXFKDVWKHHIIHFWRIWKHK\GURJHQDQGR[\JHQRYHUSR RWKHULPSRUWDQWNLQHWLFDVSHFWVVXFKDVWKHHIIHFWRIWKHK\GURJHQDQGR[\JHQRYHUSR
WHQWLDOV FI 6HFWLRQ   DQG WKH LQIOXHQFH RI + DQG 2 HYROXWLRQ FI 6HFWLRQ WHQWLDOV FI 6HFWLRQ   DQG WKH LQIOXHQFH RI + DQG 2 HYROXWLRQ FI 6HFWLRQ
 RQWKHFDWKRGLF DQGDQRGLFEUDQFKRIWKHSRODULVDWLRQFXUYH DV ZHOODVRWKHU  RQWKHFDWKRGLF DQGDQRGLFEUDQFKRIWKHSRODULVDWLRQFXUYH DV ZHOODVRWKHU
JHQHUDO FKDUDFWHULVWLFV LQWURGXFHG IRU WKH DQRGLF EUDQFK RI SRODULVDWLRQ FXUYHV FI JHQHUDO FKDUDFWHULVWLFV LQWURGXFHG IRU WKH DQRGLF EUDQFK RI SRODULVDWLRQ FXUYHV FI
6HFWLRQ DUHHJUHSUHVHQWHGLQ)LJXUH>%@ 6HFWLRQ DUHHJUHSUHVHQWHGLQ)LJXUH>%@
7KXVPDQ\LPSRUWDQWDVSHFWVRIWKHWKHRU\GHVFULEHGLQ6HFWLRQVDQGDUHUHS 7KXVPDQ\LPSRUWDQWDVSHFWVRIWKHWKHRU\GHVFULEHGLQ6HFWLRQVDQGDUHUHS
UHVHQWHG E\ )LJXUH  LQ FRPELQDWLRQ ZLWK WKH LQIRUPDWLRQ SURYLGHG LQ 7DEOH  UHVHQWHG E\ )LJXUH  LQ FRPELQDWLRQ ZLWK WKH LQIRUPDWLRQ SURYLGHG LQ 7DEOH 
)XUWKHUPRUHWKHFRPSDULVRQEHWZHHQWKH3RXUEDL[GLDJUDPDQGSRODULVDWLRQFXUYHVLQ )XUWKHUPRUHWKHFRPSDULVRQEHWZHHQWKH3RXUEDL[GLDJUDPDQGSRODULVDWLRQFXUYHVLQ
)LJXUHGUDZVDWWHQWLRQWRVRPHRIWKHFHQWUDOEHQHILWVDQGGUDZEDFNVRIWKHUPR )LJXUHGUDZVDWWHQWLRQWRVRPHRIWKHFHQWUDOEHQHILWVDQGGUDZEDFNVRIWKHUPR
G\QDPLFVDQGNLQHWLFVUHVSHFWLYHO\ZKLFKZHUHDOVRSRLQWHGRXWWKURXJKRXW6HFWLRQV G\QDPLFVDQGNLQHWLFVUHVSHFWLYHO\ZKLFKZHUHDOVRSRLQWHGRXWWKURXJKRXW6HFWLRQV
DQG DQG

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


(OHFWURFKHPLFDO0HDVXUHPHQW7HFKQLTXHV $TXHRXV0HWDOOLF&RUURVLRQ (OHFWURFKHPLFDO0HDVXUHPHQW7HFKQLTXHV $TXHRXV0HWDOOLF&RUURVLRQ

‡ 2Q WKH RQH KDQG WKH 3RXUEDL[ GLDJUDP UHSUHVHQWLQJ WKHUPRG\QDPLFV  FDQ SUR ‡ 2Q WKH RQH KDQG WKH 3RXUEDL[ GLDJUDP UHSUHVHQWLQJ WKHUPRG\QDPLFV  FDQ SUR
YLGH WKH IXOO SLFWXUH FRQFHUQLQJ WKH FRUURVLRQ WHQGHQFLHV RI D FHUWDLQ PHWDO LQ D YLGH WKH IXOO SLFWXUH FRQFHUQLQJ WKH FRUURVLRQ WHQGHQFLHV RI D FHUWDLQ PHWDO LQ D
FHUWDLQHQYLURQPHQW JLYHQWKDWWKHHVWDEOLVKHGGLDJUDPDSSURSULDWHO\UHIOHFWVWKH FHUWDLQHQYLURQPHQW JLYHQWKDWWKHHVWDEOLVKHGGLDJUDPDSSURSULDWHO\UHIOHFWVWKH
V\VWHPXQGHULQYHVWLJDWLRQ 6RWKHIXOOS+VFDOHLVUHSUHVHQWHGEXWWKHSLFWXUHLV V\VWHPXQGHULQYHVWLJDWLRQ 6RWKHIXOOS+VFDOHLVUHSUHVHQWHGEXWWKHSLFWXUHLV
OLPLWHGWRFRUURVLRQWHQGHQFLHVLHQRLQIRUPDWLRQRQWKHUDWHVRIFRUURVLRQLVRE OLPLWHGWRFRUURVLRQWHQGHQFLHVLHQRLQIRUPDWLRQRQWKHUDWHVRIFRUURVLRQLVRE
WDLQHG2QWKHRWKHUKDQGSRODULVDWLRQFXUYHV UHSUHVHQWLQJNLQHWLFV FDQSURYLGH WDLQHG2QWKHRWKHUKDQGSRODULVDWLRQFXUYHV UHSUHVHQWLQJNLQHWLFV FDQSURYLGH
IRUGHWDLOHGLQIRUPDWLRQRQWKHUDWHVEXWWKHSLFWXUHLVOLPLWHGWRDFHUWDLQS+ IRUGHWDLOHGLQIRUPDWLRQRQWKHUDWHVEXWWKHSLFWXUHLVOLPLWHGWRDFHUWDLQS+
‡ 3RXUEDL[ GLDJUDPV FDQ EH HVWDEOLVKHG EDVHG RQ WKHRUHWLFDO FRQVLGHUDWLRQV DQG ‡ 3RXUEDL[ GLDJUDPV FDQ EH HVWDEOLVKHG EDVHG RQ WKHRUHWLFDO FRQVLGHUDWLRQV DQG
KHQFHDOORZSUHGLFWLRQV HJZLWKUHJDUGWRWKHGHVLJQRIQHZFRXQWHUPHDVXUHV  KHQFHDOORZSUHGLFWLRQV HJZLWKUHJDUGWRWKHGHVLJQRIQHZFRXQWHUPHDVXUHV 
ZKLOHSRODULVDWLRQFXUYHVKDYHWREHGHWHUPLQHGH[SHULPHQWDOO\ ZKLOHSRODULVDWLRQFXUYHVKDYHWREHGHWHUPLQHGH[SHULPHQWDOO\
%DVHGRQWKHDERYHZHVXJJHVWWKDWWKHUPRG\QDPLFFRQVLGHUDWLRQVHVWDEOLVKHGRQWKH %DVHGRQWKHDERYHZHVXJJHVWWKDWWKHUPRG\QDPLFFRQVLGHUDWLRQVHVWDEOLVKHGRQWKH
EDVLVRIDSSURSULDWHDQGUHSUHVHQWDWLYH3RXUEDL[GLDJUDPVZKLFKDUHIRXQGHGRQUHD EDVLVRIDSSURSULDWHDQGUHSUHVHQWDWLYH3RXUEDL[GLDJUDPVZKLFKDUHIRXQGHGRQUHD
VRQDEOH NLQHWLF FRQVLGHUDWLRQV DQG LQWHUSUHWHG ZLWK GXH UHJDUG WR NLQHWLFV DOORZ IRU VRQDEOH NLQHWLF FRQVLGHUDWLRQV DQG LQWHUSUHWHG ZLWK GXH UHJDUG WR NLQHWLFV DOORZ IRU
WKHGHVFULSWLRQRIFRUURVLRQPHFKDQLVPV &KDSWHU DVZHOODVIRUWKHHYDOXDWLRQRI WKHGHVFULSWLRQRIFRUURVLRQPHFKDQLVPV &KDSWHU DVZHOODVIRUWKHHYDOXDWLRQRI
H[LVWLQJ &KDSWHU DQGWKHGHVLJQRIQHZFRXQWHUPHDVXUHV &KDSWHU $PRQJWKHVH H[LVWLQJ &KDSWHU DQGWKHGHVLJQRIQHZFRXQWHUPHDVXUHV &KDSWHU $PRQJWKHVH
FHQWUDO&KDSWHUVWKHDSSURDFKWRZDUGVWKHHVWDEOLVKPHQWRIWKHUHTXLUHGDSSURSULDWH FHQWUDO&KDSWHUVWKHDSSURDFKWRZDUGVWKHHVWDEOLVKPHQWRIWKHUHTXLUHGDSSURSULDWH
DQGUHSUHVHQWDWLYH3RXUEDL[GLDJUDPVLVDFHQWUDOSDUWRIWKLVWKHVLV &KDSWHU  DQGUHSUHVHQWDWLYH3RXUEDL[GLDJUDPVLVDFHQWUDOSDUWRIWKLVWKHVLV &KDSWHU 

 (OHFWURFKHPLFDO0HDVXUHPHQW7HFKQLTXHV  (OHFWURFKHPLFDO0HDVXUHPHQW7HFKQLTXHV


7KH WKHRUHWLFDO EDFNJURXQG RI VHOHFWHG PHDVXUHPHQW DQG RQOLQH PRQLWRULQJ WHFK 7KH WKHRUHWLFDO EDFNJURXQG RI VHOHFWHG PHDVXUHPHQW DQG RQOLQH PRQLWRULQJ WHFK
QLTXHVWRDVVHVVWKHFRUURVLRQWHQGHQF\DQGUDWHH[SHULPHQWDOO\LVEULHIO\RXWOLQHGLQ QLTXHVWRDVVHVVWKHFRUURVLRQWHQGHQF\DQGUDWHH[SHULPHQWDOO\LVEULHIO\RXWOLQHGLQ
WKLV 6HFWLRQ 7KH VHOHFWHG WHFKQLTXHV UHODWH WR WKH H[SHULPHQWDO SDUW RI WKLV SURMHFW WKLV 6HFWLRQ 7KH VHOHFWHG WHFKQLTXHV UHODWH WR WKH H[SHULPHQWDO SDUW RI WKLV SURMHFW
6SHFLDODVSHFWVRIWKHVHWHFKQLTXHVLQWKHDUHDRIUHLQIRUFHPHQWFRUURVLRQDQGRXUDG 6SHFLDODVSHFWVRIWKHVHWHFKQLTXHVLQWKHDUHDRIUHLQIRUFHPHQWFRUURVLRQDQGRXUDG
DSWDWLRQ FRQFHUQLQJ WKH FXVWRPLVDWLRQ WR WKH DSSOLHG H[SHULPHQWDO VHWXSV DUH GLV DSWDWLRQ FRQFHUQLQJ WKH FXVWRPLVDWLRQ WR WKH DSSOLHG H[SHULPHQWDO VHWXSV DUH GLV
FXVVHGLQ6HFWLRQVDQGUHVSHFWLYHO\,QRXURZQH[SHULPHQWDOLQYHVWLJDWLRQV FXVVHGLQ6HFWLRQVDQGUHVSHFWLYHO\,QRXURZQH[SHULPHQWDOLQYHVWLJDWLRQV
DQG LQ WKH DQDO\VLV RI WKH UHVXOWV ZH XVHG WKH FRQYHQWLRQV GHVFULEHG LQ >$670 * DQG LQ WKH DQDO\VLV RI WKH UHVXOWV ZH XVHG WKH FRQYHQWLRQV GHVFULEHG LQ >$670 *
@DVIDUDVSRVVLEOHZKLOHVRPHRIWKHDSSOLHGPHDVXUHPHQWWHFKQLTXHVZHUHFXV @DVIDUDVSRVVLEOHZKLOHVRPHRIWKHDSSOLHGPHDVXUHPHQWWHFKQLTXHVZHUHFXV
WRPGHVLJQHGDQGKHQFHQRWVWDQGDUGLVHG WRPGHVLJQHGDQGKHQFHQRWVWDQGDUGLVHG

 &RUURVLRQ3RWHQWLDO0HDVXUHPHQWVDQG0RQLWRULQJ  &RUURVLRQ3RWHQWLDO0HDVXUHPHQWVDQG0RQLWRULQJ


7KH PHDVXUHPHQW RU WKH FRQWLQXRXV PRQLWRULQJ RI µ(FRUU¶ DUH IXQGDPHQWDO QRQ 7KH PHDVXUHPHQW RU WKH FRQWLQXRXV PRQLWRULQJ RI µ(FRUU¶ DUH IXQGDPHQWDO QRQ
GHVWUXFWLYHWHFKQLTXHVWRDFFHVVWKHWKHUPRG\QDPLFVWDWHRIWKHLQYHVWLJDWHGV\VWHP GHVWUXFWLYHWHFKQLTXHVWRDFFHVVWKHWKHUPRG\QDPLFVWDWHRIWKHLQYHVWLJDWHGV\VWHP
$VGHVFULEHGLQ6HFWLRQ WKHFRUURVLRQSRWHQWLDOµ(FRUU¶ UHSUHVHQWVWKHHOHFWURGH $VGHVFULEHGLQ6HFWLRQ WKHFRUURVLRQSRWHQWLDOµ(FRUU¶ UHSUHVHQWVWKHHOHFWURGH
SRWHQWLDOZKHUHWKHUDWHVRIWKHDQRGHDQGFDWKRGHUHDFWLRQVDUHLQHTXLOLEULXPµ(FRUU¶ SRWHQWLDOZKHUHWKHUDWHVRIWKHDQRGHDQGFDWKRGHUHDFWLRQVDUHLQHTXLOLEULXPµ(FRUU¶
FDQ EH DVVHVVHG E\ VLPSO\ PHDVXULQJ WKH SRWHQWLDO GLIIHUHQFH EHWZHHQ D UHIHUHQFH FDQ EH DVVHVVHG E\ VLPSO\ PHDVXULQJ WKH SRWHQWLDO GLIIHUHQFH EHWZHHQ D UHIHUHQFH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ (OHFWURFKHPLFDO0HDVXUHPHQW7HFKQLTXHV $TXHRXV0HWDOOLF&RUURVLRQ (OHFWURFKHPLFDO0HDVXUHPHQW7HFKQLTXHV

HOHFWURGHHJDµ6&(¶DQGWKHPHWDOVXUIDFH 7KHµ5(¶LVFRQQHFWHGWRWKHJURXQG HOHFWURGHHJDµ6&(¶DQGWKHPHWDOVXUIDFH 7KHµ5(¶LVFRQQHFWHGWRWKHJURXQG


WHUPLQDODQGWKHµ:(¶ LHWKHLQYHVWLJDWHGPHWDOVDPSOH LVFRQQHFWHGWRWKHSRVLWLYH WHUPLQDODQGWKHµ:(¶ LHWKHLQYHVWLJDWHGPHWDOVDPSOH LVFRQQHFWHGWRWKHSRVLWLYH
WHUPLQDORIDKLJKLPSHGDQFHYROWPHWHU5HVXOWVFDQEHDQDO\VHGIRULQVWDQFHEDVHG WHUPLQDORIDKLJKLPSHGDQFHYROWPHWHU5HVXOWVFDQEHDQDO\VHGIRULQVWDQFHEDVHG
RQ WKH 3RXUEDL[ GLDJUDP E\ WUDQVIHUULQJ WKH PHDVXUHG SRWHQWLDO WR WKH µ6+(¶ VFDOH RQ WKH 3RXUEDL[ GLDJUDP E\ WUDQVIHUULQJ WKH PHDVXUHG SRWHQWLDO WR WKH µ6+(¶ VFDOH
HJE\VLPSO\DGGLQJP9WRWKHPHDVXUHGYDOXH>5$E@LIDµ6&(¶LVXVHG HJE\VLPSO\DGGLQJP9WRWKHPHDVXUHGYDOXH>5$E@LIDµ6&(¶LVXVHG
DVUHIHUHQFHHOHFWURGHDWƒ& FI6HFWLRQ  DVUHIHUHQFHHOHFWURGHDWƒ& FI6HFWLRQ 

 0DFURFHOO&XUUHQW0HDVXUHPHQWVDQG0RQLWRULQJ  0DFURFHOO&XUUHQW0HDVXUHPHQWVDQG0RQLWRULQJ


0DFURFHOOFXUUHQWPHDVXUHPHQWVRUWKH FRQWLQXRXVPRQLWRULQJRIWKHPDFURFHOO FXU 0DFURFHOOFXUUHQWPHDVXUHPHQWVRUWKH FRQWLQXRXVPRQLWRULQJRIWKHPDFURFHOO FXU
UHQWDUHQRQGHVWUXFWLYHWHFKQLTXHVWKDWDLPDWDFFHVVLQJWKHFXUUHQWSDVVLQJEHWZHHQ UHQWDUHQRQGHVWUXFWLYHWHFKQLTXHVWKDWDLPDWDFFHVVLQJWKHFXUUHQWSDVVLQJEHWZHHQ
WZRGLVVLPLODUPHWDOV RUWKHVDPHPHWDODWDGLIIHUHQWµ(FRUU¶ LQD JDOYDQLFFHOO FI WZRGLVVLPLODUPHWDOV RUWKHVDPHPHWDODWDGLIIHUHQWµ(FRUU¶ LQD JDOYDQLFFHOO FI
6HFWLRQ   7KH HOHFWULFDO FRQQHFWLRQ EHWZHHQ WKH WZR PHWDOV FDQ EH HVWDEOLVKHG 6HFWLRQ   7KH HOHFWULFDO FRQQHFWLRQ EHWZHHQ WKH WZR PHWDOV FDQ EH HVWDEOLVKHG
RYHU D UHVLVWRU DQG WKH PDFURFHOO FXUUHQW LV PHDVXUHG DV WKH SURSRUWLRQDO SRWHQWLDO RYHU D UHVLVWRU DQG WKH PDFURFHOO FXUUHQW LV PHDVXUHG DV WKH SURSRUWLRQDO SRWHQWLDO
RYHU WKH UHVLVWRU RU HYHQ EHWWHU RYHU D ]HURLPSHGDQFHDPPHWHU LH ZLWKRXW LQWUR RYHU WKH UHVLVWRU RU HYHQ EHWWHU RYHU D ]HURLPSHGDQFHDPPHWHU LH ZLWKRXW LQWUR
GXFLQJUHVLVWDQFHWRWKHV\VWHP ,QFDVHRIFRQWLQXRXVPRQLWRULQJWKHUHFRUGHGFXU GXFLQJUHVLVWDQFHWRWKHV\VWHP ,QFDVHRIFRQWLQXRXVPRQLWRULQJ WKH UHFRUGHGFXU
UHQWFDQEHLQWHJUDWHGWRUHSUHVHQWWKHWRWDOFKDUJHSDVVHGZKLFKFDQEHSORWWHGDVD UHQWFDQEHLQWHJUDWHGWRUHSUHVHQWWKHWRWDOFKDUJHSDVVHGZKLFKFDQEHSORWWHGDVD
IXQFWLRQ RI WLPH DQG KHQFH LQWHUUHODWHG ZLWK WKH PDWHULDO ORVV ,W VKRXOG EH HPSKD IXQFWLRQ RI WLPH DQG KHQFH LQWHUUHODWHG ZLWK WKH PDWHULDO ORVV ,W VKRXOG EH HPSKD
VLVHGKRZHYHUWKDW RQO\WKHPDFURFHOOFXUUHQWEHWZHHQWKHWZRGLVVLPLODUPHWDOVLV VLVHGKRZHYHUWKDW RQO\WKHPDFURFHOOFXUUHQWEHWZHHQWKHWZRGLVVLPLODUPHWDOVLV
PHDVXUHGDQGFRQVHTXHQWO\WKHPLFURDQGPDFURFHOOFRUURVLRQDFWLYLW\RQWKHSUHI PHDVXUHGDQGFRQVHTXHQWO\WKHPLFURDQGPDFURFHOOFRUURVLRQDFWLYLW\RQWKHSUHI
HUHQWLDOO\ FRUURGLQJ PHWDOVXUIDFHLVQRWUHIOHFWHG+HQFHWKHDSSOLFDWLRQRIPDFUR HUHQWLDOO\ FRUURGLQJ PHWDOVXUIDFH LV QRW UHIOHFWHG+HQFHWKHDSSOLFDWLRQRIPDFUR
FHOO FXUUHQW WHFKQLTXHV PD\ EH OLPLWHG LQ VRPHDUHDV RI DTXHRXV PHWDOOLF FRUURVLRQ FHOO FXUUHQW WHFKQLTXHV PD\ EH OLPLWHG LQ VRPHDUHDV RI DTXHRXV PHWDOOLF FRUURVLRQ
1HYHUWKHOHVVLWLVIUHTXHQWO\XVHGLQWKHDUHDRIUHLQIRUFHPHQWFRUURVLRQEHFDXVHRI 1HYHUWKHOHVVLWLVIUHTXHQWO\XVHGLQWKHDUHDRIUHLQIRUFHPHQWFRUURVLRQEHFDXVHRI
LWV VLPSOLFLW\ DQG WKH FOHDU LQGLFDWLRQ RI FRUURVLRQ LQLWLDWLRQ E\ D VKDUS LQFUHDVH LQ LWV VLPSOLFLW\ DQG WKH FOHDU LQGLFDWLRQ RI FRUURVLRQ LQLWLDWLRQ E\ D VKDUS LQFUHDVH LQ
PDFURFHOOFXUUHQWZLWKGHSDVVLYDWLRQRIWKHUHLQIRUFHPHQWDFWLQJDVDQRGLFPHPEHULQ PDFURFHOOFXUUHQWZLWKGHSDVVLYDWLRQRIWKHUHLQIRUFHPHQWDFWLQJDVDQRGLFPHPEHULQ
WKHJDOYDQLFFHOO FI6HFWLRQVDQG  WKHJDOYDQLFFHOO FI6HFWLRQVDQG 
7R LQGLFDWH WKDW WKH PDFURFHOO FXUUHQW GRHV QRW DFFRXQW IRU PLFURFHOO DQG PDFURFHOO 7R LQGLFDWH WKDW WKH PDFURFHOO FXUUHQW GRHV QRW DFFRXQW IRU PLFURFHOO DQG PDFURFHOO
FRUURVLRQ DFWLYLW\ RQ WKH SUHIHUHQWLDOO\ FRUURGLQJ PHWDO VXUIDFH LW LV UHIHUUHG WR DV FRUURVLRQ DFWLYLW\ RQ WKH SUHIHUHQWLDOO\ FRUURGLQJ PHWDO VXUIDFH LW LV UHIHUUHG WR DV
µLPDF¶ QRW µLFRUU¶  LQ WKH SUHVHQW WKHVLV ,Q DFFRUGDQFH ZLWK WKH GHILQLWLRQV LQ &KDSWHU µLPDF¶ QRW µLFRUU¶  LQ WKH SUHVHQW WKHVLV ,Q DFFRUGDQFH ZLWK WKH GHILQLWLRQV LQ &KDSWHU
µ7D'¶WKHPL[HGFRUURVLRQSRWHQWLDOHVWDEOLVKHGEHWZHHQWKHWZRGLVVLPLODUPHWDOVLV µ7D'¶WKHPL[HGFRUURVLRQSRWHQWLDOHVWDEOLVKHGEHWZHHQWKHWZRGLVVLPLODUPHWDOVLV
UHIHUUHGWRDVµ(FRUU¶KRZHYHU UHIHUUHGWRDVµ(FRUU¶KRZHYHU

 3RWHQWLRVWDWLFDQG*DOYDQRVWDWLF0HDVXUHPHQWVDQG0RQLWRULQJ  3RWHQWLRVWDWLFDQG*DOYDQRVWDWLF0HDVXUHPHQWVDQG0RQLWRULQJ


)RUSRWHQWLRVWDWLFDQGJDOYDQRVWDWLFPHDVXUHPHQWVRUPRQLWRULQJDSRWHQWLRVWDWLVXVHG )RUSRWHQWLRVWDWLFDQGJDOYDQRVWDWLFPHDVXUHPHQWVRUPRQLWRULQJDSRWHQWLRVWDWLVXVHG
WRNHHSHLWKHUWKHSRWHQWLDOFRQVWDQWZKLOHUHFRUGLQJWKHFXUUHQWQHFHVVDU\WRPDLQWDLQ WRNHHSHLWKHUWKHSRWHQWLDOFRQVWDQWZKLOHUHFRUGLQJWKHFXUUHQWQHFHVVDU\WRPDLQWDLQ
WKHSRWHQWLDOLHVRFDOOHGSRWHQWLRVWDWLFPRQLWRULQJRUWRDSSO\DFRQVWDQWFXUUHQWWR WKHSRWHQWLDOLHVRFDOOHGSRWHQWLRVWDWLFPRQLWRULQJRUWRDSSO\DFRQVWDQWFXUUHQWWR
 

$VPHQWLRQHGLQ6HFWLRQµ(FRUU¶PHDVXUHGLQVXFKZD\LVJHQHUDOO\UHIHUUHGWRDVKDOIFHOOSR $VPHQWLRQHGLQ6HFWLRQµ(FRUU¶PHDVXUHGLQVXFKZD\LVJHQHUDOO\UHIHUUHGWRDVKDOIFHOOSR
WHQWLDO+RZHYHUZHFRQVLGHUWKLVWHUPWREHUDWKHUPLVOHDGLQJLQWKLVFRQQHFWLRQVLQFHWKHPL[HG WHQWLDO+RZHYHUZHFRQVLGHUWKLVWHUPWREHUDWKHUPLVOHDGLQJLQWKLVFRQQHFWLRQVLQFHWKHPL[HG
SRWHQWLDOEHWZHHQWKHDQRGLFDQGFDWKRGLFUHDFWLRQV FI6HFWLRQ RQWKHPHWDOVXUIDFHLVPHDV SRWHQWLDOEHWZHHQWKHDQRGLFDQGFDWKRGLFUHDFWLRQV FI6HFWLRQ RQWKHPHWDOVXUIDFHLVPHDV
XUHG7KHWHUPKDOIFHOOSRWHQWLDOPD\DFWXDOO\KDYHOHGWRVRPHPLVLQWHUSUHWDWLRQVUHJDUGLQJWKHGH XUHG7KHWHUPKDOIFHOOSRWHQWLDOPD\DFWXDOO\KDYHOHGWRVRPHPLVLQWHUSUHWDWLRQVUHJDUGLQJWKHGH
YHORSPHQWRIµ(FRUU¶IRUVWHHOLQFRQFUHWHZKLFKZLOOEHGHDOWZLWKLQGHWDLOLQ6HFWLRQ YHORSPHQWRIµ(FRUU¶IRUVWHHOLQFRQFUHWHZKLFKZLOOEHGHDOWZLWKLQGHWDLOLQ6HFWLRQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


(OHFWURFKHPLFDO0HDVXUHPHQW7HFKQLTXHV $TXHRXV0HWDOOLF&RUURVLRQ (OHFWURFKHPLFDO0HDVXUHPHQW7HFKQLTXHV $TXHRXV0HWDOOLF&RUURVLRQ

WKH ZRUNLQJ HOHFWURGH ZKLOH UHFRUGLQJ WKH SRWHQWLDO RI WKH VDPH LH VRFDOOHG JDO WKH ZRUNLQJ HOHFWURGH ZKLOH UHFRUGLQJ WKH SRWHQWLDO RI WKH VDPH LH VRFDOOHG JDO
YDQRVWDWLF PRQLWRULQJ ,Q WKH SRWHQWLRVWDWLF PRGH D VKDUS LQFUHDVH LQ FXUUHQW LV LQ YDQRVWDWLF PRQLWRULQJ ,Q WKH SRWHQWLRVWDWLF PRGH D VKDUS LQFUHDVH LQ FXUUHQW LV LQ
GLFDWLYHRIFRUURVLRQZKHUHDVDVKDUSGHFUHDVHLQSRWHQWLDOWRORZHUYDOXHVLVWKHLQ GLFDWLYHRIFRUURVLRQZKHUHDVDVKDUSGHFUHDVHLQSRWHQWLDOWRORZHUYDOXHVLVWKHLQ
GLFDWLRQIRUFRUURVLRQDFWLYLWLHVLQWKHJDOYDQRVWDWLFPRGH GLFDWLRQIRUFRUURVLRQDFWLYLWLHVLQWKHJDOYDQRVWDWLFPRGH
'HSHQGLQJ RQ WKH GHJUHH RI SRODULVDWLRQ SRWHQWLRVWDWLF DQG JDOYDQRVWDWLF PHDVXUH 'HSHQGLQJ RQ WKH GHJUHH RI SRODULVDWLRQ SRWHQWLRVWDWLF DQG JDOYDQRVWDWLF PHDVXUH
PHQWVRUPRQLWRULQJWHFKQLTXHVFDQEHUHJDUGHGDVQRQGHVWUXFWLYHEXWZHWKLQNWKDW PHQWVRUPRQLWRULQJWHFKQLTXHVFDQEHUHJDUGHGDVQRQGHVWUXFWLYHEXWZHWKLQNWKDW
WKHVHWHFKQLTXHVLQWHUIHUHODUJHO\ZLWKWKHV\VWHPE\HLWKHUSRODULVLQJWKHµ:(¶RUUH WKHVHWHFKQLTXHVLQWHUIHUHODUJHO\ZLWKWKHV\VWHPE\HLWKHUSRODULVLQJWKHµ:(¶RUUH
VWULFWLQJLWWRPDLQWDLQDFRQVWDQWµ(FRUU¶ VWULFWLQJLWWRPDLQWDLQDFRQVWDQWµ(FRUU¶

 3RODULVDWLRQ&XUYH0HDVXUHPHQWV  3RODULVDWLRQ&XUYH0HDVXUHPHQWV


7KHWKHRU\EHKLQG DQGWKHLQWHUSUHWDWLRQRISRWHQWLDOFXUYHVZDVRXWOLQHGLQ6HFWLRQ 7KH WKHRU\EHKLQG DQG WKH LQWHUSUHWDWLRQ RISRWHQWLDOFXUYHV ZDVRXWOLQHGLQ6HFWLRQ
DQGDVWDQGDUGUHIHUHQFHWHVWPHWKRGIRUPHDVXULQJDQRGLFSRODULVDWLRQFXUYHVLV DQGDVWDQGDUGUHIHUHQFHWHVWPHWKRGIRUPHDVXULQJDQRGLFSRODULVDWLRQFXUYHVLV
VSHFLILHGLQ>$670*@ VSHFLILHGLQ>$670*@
,Q SUDFWLFH SRODULVDWLRQ FXUYH PHDVXUHPHQWV DUH SHUIRUPHG E\ PHDQV RI D WKUHH ,Q SUDFWLFH SRODULVDWLRQ FXUYH PHDVXUHPHQWV DUH SHUIRUPHG E\ PHDQV RI D WKUHH
HOHFWURGHVHWXSLHDµ:(¶Dµ&(¶DQGDµ5(¶LQFRPELQDWLRQZLWKDSRWHQWLRVWDW HOHFWURGHVHWXSLHDµ:(¶Dµ&(¶DQGDµ5(¶LQFRPELQDWLRQZLWKDSRWHQWLRVWDW
7KHSRWHQWLRVWDWLVXVHGWRFRQWUROWKHSRWHQWLDORIWKHµ:(¶LHLWVXSSOLHVYROWDJHWR 7KHSRWHQWLRVWDWLVXVHGWRFRQWUROWKHSRWHQWLDORIWKHµ:(¶LHLWVXSSOLHVYROWDJHWR
WKHFHOOFRQVLVWLQJRIWKHµ:(¶DQGWKHµ5(¶E\GHOLYHULQJDQGPHDVXULQJWKHQHFHV WKHFHOOFRQVLVWLQJRIWKHµ:(¶DQGWKHµ5(¶E\GHOLYHULQJDQGPHDVXULQJWKHQHFHV
VDU\FXUUHQWEHWZHHQWKHµ&(¶DQGWKHµ:(¶ZKLFKUHSUHVHQWVDQH[WHUQDOFXUUHQWWR VDU\FXUUHQWEHWZHHQWKHµ&(¶DQGWKHµ:(¶ZKLFKUHSUHVHQWVDQH[WHUQDOFXUUHQWWR
WKH µ:(¶ 1R H[WHUQDO FXUUHQW LV VXSSOLHG LI WKH HOHFWURGH SRWHQWLDO RI WKH µ:(¶ LV WKH µ:(¶ 1R H[WHUQDO FXUUHQW LV VXSSOLHG LI WKH HOHFWURGH SRWHQWLDO RI WKH µ:(¶ LV
HTXDOWRµ(FRUU¶$SSOLFDWLRQRISRVLWLYHFXUUHQWWRWKHµ:(¶OHDGVWRDQRGLFSRODULVD HTXDOWRµ(FRUU¶$SSOLFDWLRQRISRVLWLYHFXUUHQWWRWKHµ:(¶OHDGVWRDQRGLFSRODULVD
WLRQ DQG DSSOLFDWLRQ RI QHJDWLYH FXUUHQW SURYLGHV FDWKRGLF SRODULVDWLRQ FXUYHV FI WLRQ DQG DSSOLFDWLRQ RI QHJDWLYH FXUUHQW SURYLGHV FDWKRGLF SRODULVDWLRQ FXUYHV FI
6HFWLRQVDQG 7KXVDVPHQWLRQHGLQ6HFWLRQWKHDEVROXWHYDOXHRIWKH 6HFWLRQVDQG 7KXVDVPHQWLRQHGLQ6HFWLRQWKHDEVROXWHYDOXHRIWKH
FXUUHQWGHQVLW\µL¶LVWREHXVHGIRUWKHJUDSKLFDOUHSUHVHQWDWLRQRIWKHPHDVXUHGSR FXUUHQWGHQVLW\µL¶LVWREHXVHGIRUWKHJUDSKLFDOUHSUHVHQWDWLRQRIWKHPHDVXUHGSR
ODULVDWLRQFXUYHVWRDOORZIRUWKHORJDULWKPLFVFDOHWKDWFRUUHVSRQGVWRWKH7DIHOOLQH ODULVDWLRQFXUYHVWRDOORZIRUWKHORJDULWKPLFVFDOHWKDWFRUUHVSRQGVWRWKH7DIHOOLQH
UHSUHVHQWDWLRQ UHSUHVHQWDWLRQ
$VLQGLFDWHGLQ6HFWLRQWKHVFDQUDWHXVHGWRREWDLQSRODULVDWLRQFXUYHVFDQKDYH $VLQGLFDWHGLQ6HFWLRQWKHVFDQUDWHXVHGWRREWDLQSRODULVDWLRQFXUYHVFDQKDYH
DVLJQLILFDQWHIIHFWRQWKHGHWHUPLQDWLRQRIµ(SLW¶DVHJVLJQLILFDQWYDULDWLRQVRIWKH DVLJQLILFDQWHIIHFWRQWKHGHWHUPLQDWLRQRIµ(SLW¶DVHJVLJQLILFDQWYDULDWLRQVRIWKH
S+DQGFKORULGHFRQFHQWUDWLRQDUHLQWURGXFHGRQWKHPHWDOVXUIDFH7KXVWKHVFDQUDWH S+DQGFKORULGHFRQFHQWUDWLRQDUHLQWURGXFHGRQWKHPHWDOVXUIDFH7KXVWKHVFDQUDWH
LVDFULWLFDOSDUDPHWHUDQGWREHVHOHFWHGDSSURSULDWHO\LQSDUWLFXODUIRUDV\VWHPZLWK LVDFULWLFDOSDUDPHWHUDQGWREHVHOHFWHGDSSURSULDWHO\LQSDUWLFXODUIRUDV\VWHPZLWK
³VORZ FKHPLVWU\´ VXFK DV IRU PHWDOV HPEHGGHG LQ FRQFUHWH FI 6HFWLRQV  DQG ³VORZ FKHPLVWU\´ VXFK DV IRU PHWDOV HPEHGGHG LQ FRQFUHWH FI 6HFWLRQV  DQG
 9DULRXVRWKHUREVWDFOHVVXFKDVWKHVROXWLRQ RUFRQFUHWHEXON UHVLVWDQFHDQG  9DULRXVRWKHUREVWDFOHVVXFKDVWKHVROXWLRQ RUFRQFUHWHEXON UHVLVWDQFHDQG
FKDQJLQJ VXUIDFH FRQGLWLRQV FRPSOLFDWH SRODULVDWLRQ FXUYH PHDVXUHPHQWV DQG WKHLU FKDQJLQJ VXUIDFH FRQGLWLRQV FRPSOLFDWH SRODULVDWLRQ FXUYH PHDVXUHPHQWV DQG WKHLU
LQWHUSUHWDWLRQ7KLVDOVRKROGVIRUPHDVXUHPHQWVWKDWDUHEDVHGRQ³OLPLWHG´SRODULVD LQWHUSUHWDWLRQ7KLVDOVRKROGVIRUPHDVXUHPHQWVWKDWDUHEDVHGRQ³OLPLWHG´SRODULVD
WLRQVXFKDVOLQHDUSRODULVDWLRQUHVLVWDQFHµ/35¶PHDVXUHPHQWV FI6HFWLRQ RU WLRQVXFKDVOLQHDUSRODULVDWLRQUHVLVWDQFHµ/35¶PHDVXUHPHQWV FI6HFWLRQ RU
HOHFWURFKHPLFDOLPSHGDQFHVSHFWURVFRS\µ(,6¶ FI6HFWLRQ $GHWDLOHGGLVFXV HOHFWURFKHPLFDOLPSHGDQFHVSHFWURVFRS\µ(,6¶ FI6HFWLRQ $GHWDLOHGGLVFXV
VLRQ RQ DOO SRVVLEOH REVWDFOHV JRHV EH\RQG WKH VFRSH RI WKLV WKHVLV DQG UHIHUHQFH LV VLRQ RQ DOO SRVVLEOH REVWDFOHV JRHV EH\RQG WKH VFRSH RI WKLV WKHVLV DQG UHIHUHQFH LV
PDGHWRWKHOLWHUDWXUHHJ>%HUNH +LFNV.HOO\HWDO@7KHPRVWLPSRU PDGHWRWKHOLWHUDWXUHHJ>%HUNH +LFNV.HOO\HWDO@7KHPRVWLPSRU
WDQW HIIHFWV WR EH WDNHQ LQWR DFFRXQW IRU PHDVXULQJ VWHHO LQ FRQFUHWH DQG RXU UHODWHG WDQW HIIHFWV WR EH WDNHQ LQWR DFFRXQW IRU PHDVXULQJ VWHHO LQ FRQFUHWH DQG RXU UHODWHG
DSSURDFKHVDUHGHDOWZLWKLQ6HFWLRQVDQGUHVSHFWLYHO\)LQDOO\LWVKRXOGEH DSSURDFKHVDUHGHDOWZLWKLQ6HFWLRQVDQGUHVSHFWLYHO\)LQDOO\LWVKRXOGEH
QRWHG WKDW LQ FRQWUDVW WR µ/35¶ DQG µ(,6¶ IXOOVFDOH SRODULVDWLRQ LQWHUIHUHV ZLWK WKH QRWHG WKDW LQ FRQWUDVW WR µ/35¶ DQG µ(,6¶ IXOOVFDOH SRODULVDWLRQ LQWHUIHUHV ZLWK WKH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ (OHFWURFKHPLFDO0HDVXUHPHQW7HFKQLTXHV $TXHRXV0HWDOOLF&RUURVLRQ (OHFWURFKHPLFDO0HDVXUHPHQW7HFKQLTXHV

V\VWHP DQG WKXV SRODULVDWLRQ FXUYH PHDVXUHPHQWV DUH UHJDUGHG DV GHVWUXFWLYH WHFK V\VWHP DQG WKXV SRODULVDWLRQ FXUYH PHDVXUHPHQWV DUH UHJDUGHG DV GHVWUXFWLYH WHFK
QLTXHV QLTXHV

 /LQHDU3RODULVDWLRQ5HVLVWDQFH0HDVXUHPHQWV  /LQHDU3RODULVDWLRQ5HVLVWDQFH0HDVXUHPHQWV


/LQHDUSRODULVDWLRQUHVLVWDQFHµ/35¶PHDVXUHPHQWVDUHEDVHGRQWKHIDFWWKDWWKHSR /LQHDUSRODULVDWLRQUHVLVWDQFHµ/35¶PHDVXUHPHQWVDUHEDVHGRQWKHIDFWWKDWWKHSR
ODULVDWLRQ FXUYH FORVH WR µ(FRUU¶ DSSUR[LPDWHV OLQHDULW\ LH WKH DQRGLF DQG FDWKRGLF ODULVDWLRQ FXUYH FORVH WR µ(FRUU¶ DSSUR[LPDWHV OLQHDULW\ LH WKH DQRGLF DQG FDWKRGLF
FXUUHQWVDUHDOPRVWHTXDOLQPDJQLWXGH FI6HFWLRQ $WKUHHHOHFWURGHVHWXSLQ FXUUHQWVDUHDOPRVWHTXDOLQPDJQLWXGH FI6HFWLRQ $WKUHHHOHFWURGHVHWXSLQ
FRPELQDWLRQ ZLWK D SRWHQWLRVWDW FDSDEOH RI SHUIRUPLQJ µ/35¶ URXWLQHV LV DSSOLHG WR FRPELQDWLRQ ZLWK D SRWHQWLRVWDW FDSDEOH RI SHUIRUPLQJ µ/35¶ URXWLQHV LV DSSOLHG WR
LPSRVHDVPDOOSRWHQWLDOSHUWXUEDWLRQµ¨(S¶GHILQHGZLWKUHVSHFWWRWKHFRUURVLRQSR LPSRVHDVPDOOSRWHQWLDOSHUWXUEDWLRQµ¨(S¶GHILQHGZLWKUHVSHFWWRWKHFRUURVLRQSR
WHQWLDO WHQWLDO
Δ( S = ( − ( FRUU  >@ Δ( S = ( − ( FRUU  >@

WRWKHPHWDOVDPSOHDQGWKHUHVXOWLQJFXUUHQWGHQVLW\UHVSRQVHµ¨LS¶LVUHFRUGHG6LQFH WRWKHPHWDOVDPSOHDQGWKHUHVXOWLQJFXUUHQWGHQVLW\UHVSRQVHµ¨LS¶LVUHFRUGHG6LQFH
WKH PDJQLWXGH RI µ¨(S¶ LV VPDOO WKH HOHFWURFKHPLFDO V\VWHP LV QRW VLJQLILFDQWO\ DI WKH PDJQLWXGH RI µ¨(S¶ LV VPDOO WKH HOHFWURFKHPLFDO V\VWHP LV QRW VLJQLILFDQWO\ DI
IHFWHGDQGµ/35¶FDQWKXVEHFRQVLGHUHGWREHDQRQGHVWUXFWLYHWHFKQLTXH7KHSR IHFWHGDQGµ/35¶FDQWKXVEHFRQVLGHUHGWREHDQRQGHVWUXFWLYHWHFKQLTXH7KHSR
ODULVDWLRQUHVLVWDQFHµ5S¶RIDFRUURGLQJHOHFWURGHFDQWKHQEHGHILQHGDV ODULVDWLRQUHVLVWDQFHµ5S¶RIDFRUURGLQJHOHFWURGHFDQWKHQEHGHILQHGDV
Δ(S Δ(S
5S =  >@ 5S =  >@
ΔL S ΔL S

7KH FRUURVLRQ FXUUHQW µLFRUU¶ FDQ EH H[SUHVVHG LQ UHODWLRQ WR µ5S¶ E\ WKH 6WHUQ*HDU\ 7KH FRUURVLRQ FXUUHQW µLFRUU¶ FDQ EH H[SUHVVHG LQ UHODWLRQ WR µ5S¶ E\ WKH 6WHUQ*HDU\
HTXDWLRQ>6WHUQ *HDU\@ HTXDWLRQ>6WHUQ *HDU\@
% %
L FRUU =  >@ L FRUU =  >@
5S 5S

ZLWK µ%¶  DV WKH VRFDOOHG 6WHUQ*HDU\ FRHIILFLHQW 7KH 6WHUQ*HDU\ FRHIILFLHQW FDQ ZLWK µ%¶  DV WKH VRFDOOHG 6WHUQ*HDU\ FRHIILFLHQW 7KH 6WHUQ*HDU\ FRHIILFLHQW FDQ
EHUHODWHGWRWKHDQRGLFDQGFDWKRGLF7DIHOOLQHVµED¶DQGµEF¶E\ EHUHODWHGWRWKHDQRGLFDQGFDWKRGLF7DIHOOLQHVµED¶DQGµEF¶E\
ED × EF ED × EF
% =  >@ % =  >@
 × ( E D + E F )  × ( E D + E F )

)RUWKHGHULYDWLRQRIWKHDERYHHTXDWLRQDQGWKHPHWKRGIRUHVWLPDWLQJ7DIHOVORSHV )RUWKHGHULYDWLRQRIWKHDERYHHTXDWLRQDQGWKHPHWKRGIRUHVWLPDWLQJ7DIHOVORSHV
EDVHG RQ WKH PHDVXUHG GDWD UHIHUHQFH LV PDGH WR >$670 * @ $ VWDQGDUG EDVHG RQ WKH PHDVXUHG GDWD UHIHUHQFH LV PDGH WR >$670 * @ $ VWDQGDUG
UHIHUHQFH WHVW PHWKRG IRU SHUIRUPLQJ µ/35¶ PHDVXUHPHQWV LV SURYLGHG LQ >$670 UHIHUHQFH WHVW PHWKRG IRU SHUIRUPLQJ µ/35¶ PHDVXUHPHQWV LV SURYLGHG LQ >$670
* @ 7KH $670 VWDQGDUG SUDFWLFH IRU FDOFXODWLRQ RI FRUURVLRQ UDWHV DQG UH * @ 7KH $670 VWDQGDUG SUDFWLFH IRU FDOFXODWLRQ RI FRUURVLRQ UDWHV DQG UH
ODWHGLQIRUPDWLRQIURPHOHFWURFKHPLFDOPHDVXUHPHQWV>$670*@DOVRSUR ODWHGLQIRUPDWLRQIURPHOHFWURFKHPLFDOPHDVXUHPHQWV>$670*@DOVRSUR
YLGHVPHDQVWRFDOFXODWHWKHFRUURVLRQUDWHRIGLIIHUHQWPHWDOVHJH[SUHVVHGLQPLO YLGHVPHDQVWRFDOFXODWHWKHFRUURVLRQUDWHRIGLIIHUHQWPHWDOVHJH[SUHVVHGLQPLO
OLPHWUHVRIPDWHULDOORVVSHU\HDUEDVHGRQµLFRUU¶GHWHUPLQHGE\µ/35¶RUTXDOLWDWLYHO\ OLPHWUHVRIPDWHULDOORVVSHU\HDUEDVHGRQµLFRUU¶GHWHUPLQHGE\µ/35¶RUTXDOLWDWLYHO\
E\PDFURFHOOFXUUHQWPRQLWRULQJ WDNLQJLQWRDFFRXQWWKHOLPLWDWLRQRIWKLVPHWKRGGH E\PDFURFHOOFXUUHQWPRQLWRULQJ WDNLQJLQWRDFFRXQWWKHOLPLWDWLRQRIWKLVPHWKRGGH
VFULEHGLQ  ,WVKRXOGEHQRWHGWKDWWKHPHDVXUHPHQWRIWKHFXUUHQWZKLFKLVUH VFULEHGLQ  ,WVKRXOGEHQRWHGWKDWWKHPHDVXUHPHQWRIWKHFXUUHQWZKLFKLVUH
TXLUHGWRPDLQWDLQDFRQVWDQWSRWHQWLDOXQGHUSRWHQWLRVWDWLFFRQWURO FI6HFWLRQ  TXLUHGWRPDLQWDLQDFRQVWDQWSRWHQWLDOXQGHUSRWHQWLRVWDWLFFRQWURO FI6HFWLRQ 
GRHVQRWDOORZFRQFOXVLRQVDERXWWKHFRUURVLRQUDWHVLQFHWKLVFXUUHQWGRHVQRWDWDOO GRHVQRWDOORZFRQFOXVLRQVDERXWWKHFRUURVLRQUDWHVLQFHWKLVFXUUHQWGRHVQRWDWDOO
UHIOHFWµLFRUU¶ UHIOHFWµLFRUU¶

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


(OHFWURFKHPLFDO0HDVXUHPHQW7HFKQLTXHV $TXHRXV0HWDOOLF&RUURVLRQ (OHFWURFKHPLFDO0HDVXUHPHQW7HFKQLTXHV $TXHRXV0HWDOOLF&RUURVLRQ

 (OHFWURFKHPLFDO,PSHGDQFH6SHFWURVFRS\  (OHFWURFKHPLFDO,PSHGDQFH6SHFWURVFRS\


(OHFWURFKHPLFDO LPSHGDQFH VSHFWURVFRS\ µ(,6¶ LV EDVHG RQ WKH VDPH SULQFLSOHV DV (OHFWURFKHPLFDO LPSHGDQFH VSHFWURVFRS\ µ(,6¶ LV EDVHG RQ WKH VDPH SULQFLSOHV DV
µ/35¶PHDVXUHPHQWVZLWKWKHGLIIHUHQFHWKDWWKHFXUUHQWGHQVLW\UHVSRQVHµ¨LS¶RIWKH µ/35¶PHDVXUHPHQWVZLWKWKHGLIIHUHQFHWKDWWKHFXUUHQWGHQVLW\UHVSRQVHµ¨LS¶RIWKH
SRWHQWLDO SHUWXUEDWLRQ µ¨(S¶ LV PHDVXUHG DW YDU\LQJ IUHTXHQFLHV $V µ/35¶ µ(,6¶ LV SRWHQWLDO SHUWXUEDWLRQ µ¨(S¶ LV PHDVXUHG DW YDU\LQJ IUHTXHQFLHV $V µ/35¶ µ(,6¶ LV
EDVHGRQDWKUHHHOHFWURGHVHWXSLQFRPELQDWLRQZLWKDSRWHQWLRVWDWWKDWLVFDSDEOHRI EDVHGRQDWKUHHHOHFWURGHVHWXSLQFRPELQDWLRQZLWKDSRWHQWLRVWDWWKDWLVFDSDEOHRI
SHUIRUPLQJ µ(,6¶ 2WKHUZLVH D IUHTXHQF\ UHVSRQVH DQDO\]HU µ)53¶  FDQ EH XVHG LQ SHUIRUPLQJ µ(,6¶ 2WKHUZLVH D IUHTXHQF\ UHVSRQVH DQDO\]HU µ)53¶  FDQ EH XVHG LQ
FRPELQDWLRQ ZLWK DQ HOHFWURFKHPLFDO LQWHUIDFH WR SHUIRUP µ(,6¶ $670 SURYLGHV D FRPELQDWLRQ ZLWK DQ HOHFWURFKHPLFDO LQWHUIDFH WR SHUIRUP µ(,6¶ $670 SURYLGHV D
VWDQGDUGSUDFWLFHIRUYHULILFDWLRQRIDOJRULWKPDQGHTXLSPHQWIRUHOHFWURFKHPLFDOLP VWDQGDUGSUDFWLFHIRUYHULILFDWLRQRIDOJRULWKPDQGHTXLSPHQWIRUHOHFWURFKHPLFDOLP
SHGDQFH PHDVXUHPHQWV >$670 * @ ZKLFK DOVR FRQWDLQV DQ DSSHQGL[ UH SHGDQFH PHDVXUHPHQWV >$670 * @ ZKLFK DOVR FRQWDLQV DQ DSSHQGL[ UH
YLHZLQJWKHGHWDLOVRIWKLVPHDVXUHPHQWWHFKQLTXH7KHPRVWLPSRUWDQWWKHRU\IRUWKH YLHZLQJWKHGHWDLOVRIWKLVPHDVXUHPHQWWHFKQLTXH7KHPRVWLPSRUWDQWWKHRU\IRUWKH
SXUSRVH RI WKLV WKHVLV FRQFHUQLQJ µ(,6¶ DQG WKH DQDO\VLV RI WKH DVVRFLDWHG PHDVXUH SXUSRVH RI WKLV WKHVLV FRQFHUQLQJ µ(,6¶ DQG WKH DQDO\VLV RI WKH DVVRFLDWHG PHDVXUH
PHQWGDWDLVEDVHGRQWKHGHVFULSWLRQVLQ>$670*@DV ZHOODVDGGLWLRQDO PHQWGDWDLVEDVHGRQWKHGHVFULSWLRQVLQ>$670*@DV ZHOODVDGGLWLRQDO
OLWHUDWXUH HJ >*DEULHOOL  -RQHV  &RWWLV  7XUJRRVH  .HOO\ HWDO OLWHUDWXUH HJ >*DEULHOOL  -RQHV  &RWWLV  7XUJRRVH  .HOO\ HWDO
$XWR/DE*DPU\@WKDWDUHEULHIO\VXPPDULVHGLQWKLV6HFWLRQ $XWR/DE*DPU\@WKDWDUHEULHIO\VXPPDULVHGLQWKLV6HFWLRQ
'XULQJµ(,6¶UXQVDVPDOODPSOLWXGHVLQXVRLGDOµ¨(S W ¶LVDSSOLHGWRWKHµ:(¶DWD 'XULQJµ(,6¶UXQVDVPDOODPSOLWXGHVLQXVRLGDOµ¨(S W ¶LVDSSOLHGWRWKHµ:(¶DWD
QXPEHU RI IUHTXHQFLHV µȦ¶ H[SUHVVHG DV DQJXODU IUHTXHQF\  E\ VXSHULPSRVLQJ LW RQ QXPEHU RI IUHTXHQFLHV µȦ¶ H[SUHVVHG DV DQJXODU IUHTXHQF\  E\ VXSHULPSRVLQJ LW RQ
WKHVXSSOLHGGLUHFWFXUUHQW µ'&¶ SRODULVDWLRQSRWHQWLDOZKLFKPDLQWDLQVWKHµ:(¶DW WKHVXSSOLHGGLUHFWFXUUHQW µ'&¶ SRODULVDWLRQSRWHQWLDOZKLFKPDLQWDLQVWKHµ:(¶DW
µ(FRUU¶ GXULQJ WKH µ(,6¶ UXQ  $W HDFK RQH RI WKHVH IUHTXHQFLHV WKH UHVXOWLQJ FXUUHQW µ(FRUU¶ GXULQJ WKH µ(,6¶ UXQ  $W HDFK RQH RI WKHVH IUHTXHQFLHV WKH UHVXOWLQJ FXUUHQW
GHQVLW\ZDYHIRUPH[KLELWVDVLQXVRLGDOUHVSRQVHµ¨LS W ¶WKDWLVRXWRISKDVHZLWKWKH GHQVLW\ZDYHIRUPH[KLELWVDVLQXVRLGDOUHVSRQVHµ¨LS W ¶WKDWLVRXWRISKDVHZLWKWKH
DSSOLHGµ¨(S W ¶E\DPDJQLWXGHGHWHUPLQHGXSRQWKHFLUFXLWSDUDPHWHUVRIWKHPHWDO DSSOLHGµ¨(S W ¶E\DPDJQLWXGHGHWHUPLQHGXSRQWKHFLUFXLWSDUDPHWHUVRIWKHPHWDO
HOHFWURO\WH LQWHUIDFH RI WKH µ:(¶ $PRQJ RWKHU SRVVLEOH SDUDPHWHUV WKH HOHFWULFDO HOHFWURO\WH LQWHUIDFH RI WKH µ:(¶ $PRQJ RWKHU SRVVLEOH SDUDPHWHUV WKH HOHFWULFDO
GRXEOHOD\HUWHQGVWRDFWDVFDSDFLWRU FI6HFWLRQ ZKHUHDVDSDVVLYHOD\HUIXQF GRXEOHOD\HUWHQGVWRDFWDVFDSDFLWRU FI6HFWLRQ ZKHUHDVDSDVVLYHOD\HUIXQF
WLRQVDVD UHVLVWRULQ µ(,6¶ FI6HFWLRQV DQG  7KHFXUUHQW DPSOLWXGHLV WLRQVDVD UHVLVWRULQ µ(,6¶ FI6HFWLRQV DQG  7KHFXUUHQW DPSOLWXGHLV
LQYHUVHO\SURSRUWLRQDOWRWKHHOHFWURFKHPLFDOLPSHGDQFHRIWKHLQWHUIDFHµ= Ȧ ¶7KXV LQYHUVHO\SURSRUWLRQDOWRWKHHOHFWURFKHPLFDOLPSHGDQFHRIWKHLQWHUIDFHµ= Ȧ ¶7KXV
µ= Ȧ ¶LVWKHIUHTXHQF\ GHSHQGHQWSURSRUWLRQDOLW\ IDFWRURIWKHHOHFWURFKHPLFDOV\V µ= Ȧ ¶LVWKHIUHTXHQF\ GHSHQGHQWSURSRUWLRQDOLW\ IDFWRURIWKHHOHFWURFKHPLFDOV\V
WHPWKDWFDQEHH[SUHVVHGE\WKHTXRWLHQWRIµ¨(S W ¶DQGµ¨LS W ¶ WHPWKDWFDQEHH[SUHVVHGE\WKHTXRWLHQWRIµ¨(S W ¶DQGµ¨LS W ¶

Δ( S ( W ) Δ( S ( W )
= ( ω) =  >@ = ( ω) =  >@
ΔL S ( W ) ΔL S ( W )

ZKHUHµ¨(S Ȧ ¶FDQEHH[SUHVVHGDV ZKHUHµ¨(S Ȧ ¶FDQEHH[SUHVVHGDV


Δ( S W Δ( S × VLQ ω × W  >@ Δ( S W Δ( S × VLQ ω × W  >@

DQGFRUUHVSRQGLQJO\µ¨LS W ¶ZLWKWKHSKDVHVKLIWµij¶ DQGFRUUHVSRQGLQJO\µ¨LS W ¶ZLWKWKHSKDVHVKLIWµij¶


ΔL S W ΔL S × VLQ ω × W  ϕ  >@ ΔL S W ΔL S × VLQ ω × W  ϕ  >@

7KHLPSHGDQFHRIWKHV\VWHPµ= Ȧ ¶LVDFRPSOH[TXDQWLW\DQGFDQEHUHSUHVHQWHGLQ 7KHLPSHGDQFHRIWKHV\VWHPµ= Ȧ ¶LVDFRPSOH[TXDQWLW\DQGFDQEHUHSUHVHQWHGLQ


SRODUDVZHOODV&DUWHVLDQFRRUGLQDWHV,QSRODUFRRUGLQDWHVµ= Ȧ ¶LVJLYHQE\ SRODUDVZHOODV&DUWHVLDQFRRUGLQDWHV,QSRODUFRRUGLQDWHVµ= Ȧ ¶LVJLYHQE\

 

,QRXURZQH[SHULPHQWDOWULDOVZHIRXQGRXWWKDWLWLVFUXFLDOWRVXSSO\DGLUHFWFXUUHQWWRPDLQWDLQ ,QRXURZQH[SHULPHQWDOWULDOVZHIRXQGRXWWKDWLWLVFUXFLDOWRVXSSO\DGLUHFWFXUUHQWWRPDLQWDLQ
µ(FRUU¶(YHQLIYHU\VPDOODPSOLWXGHVZHUHXVHGIRUWKHSRWHQWLDOSHUWXUEDWLRQµ(FRUU¶ZDVODUJHO\DI µ(FRUU¶(YHQLIYHU\VPDOODPSOLWXGHVZHUHXVHGIRUWKHSRWHQWLDOSHUWXUEDWLRQµ(FRUU¶ZDVODUJHO\DI
IHFWHGE\SHUWXUEDWLRQZLWKRXWFRQWURORIµ(FRUU¶ IHFWHGE\SHUWXUEDWLRQZLWKRXWFRQWURORIµ(FRUU¶

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ (OHFWURFKHPLFDO0HDVXUHPHQW7HFKQLTXHV $TXHRXV0HWDOOLF&RUURVLRQ (OHFWURFKHPLFDO0HDVXUHPHQW7HFKQLTXHV

= ( ω) = = ( ω) × Hϕ ω  >@ = ( ω) = = ( ω) × Hϕ ω  >@

DQGLQ&DUWHVLDQFRRUGLQDWHVLWFDQEHH[SUHVVHGDV DQGLQ&DUWHVLDQFRRUGLQDWHVLWFDQEHH[SUHVVHGDV

= ( ω) = =U ( ω) + M × = M ( ω)  >@ = ( ω) = =U ( ω) + M × = M ( ω)  >@

ZKHUHµ=U Ȧ ¶LVWKHUHDOSDUWRIWKHLPSHGDQFHDQGµ=M Ȧ ¶LVWKHLPDJLQDU\SDUWRI ZKHUHµ=U Ȧ ¶LVWKHUHDOSDUWRIWKHLPSHGDQFHDQGµ=M Ȧ ¶LVWKHLPDJLQDU\SDUWRI


WKH LPSHGDQFH ZLWK µM¶  DV WKH VTXDUH URRW RI í >-RQHV  .HOO\ HWDO  WKH LPSHGDQFH ZLWK µM¶  DV WKH VTXDUH URRW RI í >-RQHV  .HOO\ HWDO 
$XWR/DE$670*@ $XWR/DE$670*@
7KHSORWRIµ=M Ȧ ¶RQWKH<D[LVYHUVXVµ=U Ȧ ¶LQWKH VDPHVFDOHRQWKH;D[LVUH 7KHSORW RI µ=M Ȧ ¶RQWKH<D[LVYHUVXVµ=U Ȧ ¶ LQ WKH VDPHVFDOH RQ WKH ;D[LVUH
VXOWVLQDVRFDOOHG1\TXLVWSORW 7KHDGYDQWDJHRI1\TXLVWSORWVLVWKDWWKH\SURYLGH VXOWVLQDVRFDOOHG1\TXLVWSORW 7KHDGYDQWDJHRI1\TXLVWSORWVLVWKDWWKH\SURYLGH
DEHQHILFLDORYHUYLHZRIWKHGDWDDOORZLQJUDSLGTXDOLWDWLYHLQWHUSUHWDWLRQV7KHGLVDG DEHQHILFLDORYHUYLHZRIWKHGDWDDOORZLQJUDSLGTXDOLWDWLYHLQWHUSUHWDWLRQV7KHGLVDG
YDQWDJHLVWKDWLQIRUPDWLRQRQWKHIUHTXHQF\LVQRUPDOO\QRWLQFOXGHGEXWWKHFXUYH YDQWDJHLVWKDWLQIRUPDWLRQRQWKHIUHTXHQF\LVQRUPDOO\QRWLQFOXGHGEXWWKHFXUYH
FDQDGGLWLRQDOO\EHODEHOOHGZLWKVRFDOOHGIUHTXHQF\PDUNHUV FDQDGGLWLRQDOO\EHODEHOOHGZLWKVRFDOOHGIUHTXHQF\PDUNHUV
$QDOWHUQDWLYHWR1\TXLVWSORWVIRUWKHUHSUHVHQWDWLRQRIµ(,6¶GDWDDUH%RGHSORWV‚,Q $QDOWHUQDWLYHWR1\TXLVWSORWVIRUWKHUHSUHVHQWDWLRQRIµ(,6¶GDWDDUH%RGHSORWV‚,Q
%RGHSORWVWKHDEVROXWHYDOXHVRIµ=¶DQGWKHSKDVHVKLIWµij¶DUHSORWWHGDVDIXQFWLRQ %RGHSORWVWKHDEVROXWHYDOXHVRIµ=¶DQGWKHSKDVHVKLIWµij¶DUHSORWWHGDVDIXQFWLRQ
RIWKHIUHTXHQF\µȦ¶E\WZRLQGLYLGXDOFXUYHV*HQHUDOO\DOOD[HVLQ%RGHSORWVDUH RIWKHIUHTXHQF\µȦ¶E\WZRLQGLYLGXDOFXUYHV*HQHUDOO\DOOD[HVLQ%RGHSORWVDUH
JLYHQLQWKHORJVFDOH JLYHQLQWKHORJVFDOH
7KHUHODWLRQVKLSEHWZHHQWKHWZRZD\VRIUHSUHVHQWLQJSORWVFDQEHGHVFULEHGDVIRO 7KHUHODWLRQVKLSEHWZHHQWKHWZRZD\VRIUHSUHVHQWLQJSORWVFDQEHGHVFULEHGDVIRO
ORZV>$XWR/DE@ ORZV>$XWR/DE@

= ( =U ( ω) ) + ( = M ( ω) ) = ( =U ( ω) ) + ( = M ( ω) )
     
= ( ω) = ( ω)
§ = ( ω) ·  >@ § = ( ω) ·  >@
ϕ = WDQ − ¨¨ M ¸¸ ϕ = WDQ − ¨¨ M ¸¸
© =U ( ω) ¹ © =U ( ω) ¹
RU RU

=U ( ω) = = ( ω) × FRV ϕ =U ( ω) = = ( ω) × FRV ϕ
 >@  >@
= M ( ω) = = ( ω) × VLQ ϕ = M ( ω) = = ( ω) × VLQ ϕ

,QRXUDQDO\VLVRIµ(,6¶GDWDZHXVHG%RGHSORWVRQO\PDUJLQDOO\HJIRUWKHYHULIL ,QRXUDQDO\VLVRIµ(,6¶GDWDZHXVHG%RGHSORWVRQO\PDUJLQDOO\HJIRUWKHYHULIL
FDWLRQ RI PHDVXUHPHQW GDWD DQG IDYRXUHG 1\TXLVW SORWV IRU WKH LQWHUSUHWDWLRQ RI UH FDWLRQ RI PHDVXUHPHQW GDWD DQG IDYRXUHG 1\TXLVW SORWV IRU WKH LQWHUSUHWDWLRQ RI UH
VXOWV7KHTXDOLWDWLYHRYHUYLHZLQ1\TXLVWSORWVSURYLGHVYDULRXVEHQHILFLDOPHDQVLQ VXOWV7KHTXDOLWDWLYHRYHUYLHZLQ1\TXLVWSORWVSURYLGHVYDULRXVEHQHILFLDOPHDQVLQ
SDUWLFXODU ZLWK UHJDUG WR FRPSDULQJ GDWD HJ FRPSDULVRQ EHWZHHQ ³GLIIHUHQW VSHFL SDUWLFXODU ZLWK UHJDUG WR FRPSDULQJ GDWD HJ FRPSDULVRQ EHWZHHQ ³GLIIHUHQW VSHFL
PHQVDWWKHVDPHH[SRVXUHWLPH´RU³WKHVDPHVSHFLPHQDWGLIIHUHQWH[SRVXUHWLPHV´ PHQVDWWKHVDPHH[SRVXUHWLPH´RU³WKHVDPHVSHFLPHQDWGLIIHUHQWH[SRVXUHWLPHV´
>.WHUHWDOE@+HQFHWKH%RGHSORWUHSUHVHQWDWLRQZLOOQRWEHGHDOWZLWKLQGH >.WHUHWDOE@+HQFHWKH%RGHSORWUHSUHVHQWDWLRQZLOOQRWEHGHDOWZLWKLQGH
WDLO LQ WKLV WKHVLV DQG UHIHUHQFH LV PDGH WR WKH DERYH PHQWLRQHG OLWHUDWXUH 6HOHFWHG WDLO LQ WKLV WKHVLV DQG UHIHUHQFH LV PDGH WR WKH DERYH PHQWLRQHG OLWHUDWXUH 6HOHFWHG
1\TXLVW SORWV DUH VKRZQ LQ )LJXUH  WRJHWKHU ZLWK WKHLU DVVRFLDWHG HTXLYDOHQW FLU 1\TXLVW SORWV DUH VKRZQ LQ )LJXUH  WRJHWKHU ZLWK WKHLU DVVRFLDWHG HTXLYDOHQW FLU
FXLWVIRUDEULHIVXPPDU\RIWKHXQGHUO\LQJWKHRU\RIWKLVDSSURDFKLQDQDO\VLQJµ(,6¶ FXLWVIRUDEULHIVXPPDU\RIWKHXQGHUO\LQJWKHRU\RIWKLVDSSURDFKLQDQDO\VLQJµ(,6¶
GDWD GDWD
 

1DPHGDIWHU+DUU\1\TXLVW6ZHGHQ86$>5REHUJH@ 1DPHGDIWHU+DUU\1\TXLVW6ZHGHQ86$>5REHUJH@
‚ ‚
1DPHGDIWHU+HQGULN:DGH%RGH86$>5REHUJH@  1DPHGDIWHU+HQGULN:DGH%RGH86$>5REHUJH@ 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&KHPLFDODQG(OHFWURFKHPLFDO6XUIDFH0RGLILFDWLRQV $TXHRXV0HWDOOLF&RUURVLRQ &KHPLFDODQG(OHFWURFKHPLFDO6XUIDFH0RGLILFDWLRQV $TXHRXV0HWDOOLF&RUURVLRQ

 
)LJXUH *UDSKLFDO UHSUHVHQWDWLRQ RI HOHFWURFKHPLFDO LPSHGDQFH VSHFWURVFRS\ )LJXUH *UDSKLFDO UHSUHVHQWDWLRQ RI HOHFWURFKHPLFDO LPSHGDQFH VSHFWURVFRS\
GDWDE\VFKHPDWLF1\TXLVWSORWVZLWKDVVRFLDWHGHTXLYDOHQWFLUFXLWV$I GDWDE\VFKHPDWLF1\TXLVWSORWVZLWKDVVRFLDWHGHTXLYDOHQWFLUFXLWV$I
WHU>-RQHV@>$@&RUURGLQJLQWHUIDFHVLPXODWHGE\VROXWLRQUHVLV WHU>-RQHV@>$@&RUURGLQJLQWHUIDFHVLPXODWHGE\VROXWLRQUHVLV
WDQFH µ5ȍ¶ LQ VHULHV ZLWK SDUDOOHO FRQQHFWHG SRODULVDWLRQ UHVLVWDQFH WDQFH µ5ȍ¶ LQ VHULHV ZLWK SDUDOOHO FRQQHFWHG SRODULVDWLRQ UHVLVWDQFH
µ5S¶DQGGRXEOHOD\HUFDSDFLWDQFHµ&GO¶>%@ $V>$@DQG:DUEXUJLP µ5S¶DQGGRXEOHOD\HUFDSDFLWDQFHµ&GO¶>%@ $V>$@DQG:DUEXUJLP
SHGDQFHµ:¶FRQQHFWHGLQVHULHVDIWHUµ5S¶DGGHGWRWKHHTXLYDOHQWFLU SHGDQFHµ:¶FRQQHFWHGLQVHULHVDIWHUµ5S¶DGGHGWRWKHHTXLYDOHQWFLU
FXLW FXLW
$Q HTXLYDOHQW FLUFXLW UHSUHVHQWLQJ D FRUURGLQJ LQWHUIDFH E\ WKH VROXWLRQ UHVLVWDQFH $Q HTXLYDOHQW FLUFXLW UHSUHVHQWLQJ D FRUURGLQJ LQWHUIDFH E\ WKH VROXWLRQ UHVLVWDQFH
µ5ȍ¶ LQ VHULHV ZLWK SDUDOOHO FRQQHFWHG SRODULVDWLRQ UHVLVWDQFH µ5S¶ DQG GRXEOH OD\HU µ5ȍ¶ LQ VHULHV ZLWK SDUDOOHO FRQQHFWHG SRODULVDWLRQ UHVLVWDQFH µ5S¶ DQG GRXEOH OD\HU
FDSDFLWDQFH µ&GO¶ FI 6HFWLRQ   ZKLFK RIWHQ LV DQ DGHTXDWH UHSUHVHQWDWLRQ RI D FDSDFLWDQFH µ&GO¶ FI 6HFWLRQ   ZKLFK RIWHQ LV DQ DGHTXDWH UHSUHVHQWDWLRQ RI D
FRUURGLQJ VXUIDFH ZLWK DFWLYDWLRQ SRODULVDWLRQ LQ DTXHRXV FRUURVLRQ FI 6HFWLRQ FRUURGLQJ VXUIDFH ZLWK DFWLYDWLRQ SRODULVDWLRQ LQ DTXHRXV FRUURVLRQ FI 6HFWLRQ
 DQGLWVFRUUHVSRQGLQJ1\TXLVWSORWDUHVKRZQLQ)LJXUH7KH1\TXLVWSORW  DQGLWVFRUUHVSRQGLQJ1\TXLVWSORWDUHVKRZQLQ)LJXUH7KH1\TXLVWSORW
FRQVLVWVRIDVHPLFLUFOHZLWKLQFUHDVLQJIUHTXHQF\µȦ¶LQDFRXQWHUFORFNZLVHGLUHFWLRQ FRQVLVWVRIDVHPLFLUFOHZLWKLQFUHDVLQJIUHTXHQF\µȦ¶LQDFRXQWHUFORFNZLVHGLUHFWLRQ
$WYHU\KLJKIUHTXHQFLHVµ=M¶GLVDSSHDUVOHDYLQJRQO\µ5ȍ¶$WYHU\ORZIUHTXHQFLHV $WYHU\KLJKIUHTXHQFLHVµ=M¶GLVDSSHDUVOHDYLQJRQO\µ5ȍ¶$WYHU\ORZIUHTXHQFLHV
µ=M¶DJDLQGLVDSSHDUVOHDYLQJDVXPRIµ5ȍ¶DQGµ5S¶,WLVHYLGHQWIURP)LJXUH>$@ µ=M¶DJDLQGLVDSSHDUVOHDYLQJDVXPRIµ5ȍ¶DQGµ5S¶,WLVHYLGHQWIURP)LJXUH>$@
WKDW WKH µ5ȍ¶ PHDVXUHG DW KLJK IUHTXHQFLHV FDQ EH VXEWUDFWHG IURP WKH VXP RI WKDW WKH µ5ȍ¶ PHDVXUHG DW KLJK IUHTXHQFLHV FDQ EH VXEWUDFWHG IURP WKH VXP RI
µ5S5ȍ¶DWORZIUHTXHQFLHVWRJLYHDFRPSHQVDWHGYDOXHRIµ5S¶IUHHRIRKPLFLQWHU µ5S5ȍ¶DWORZIUHTXHQFLHVWRJLYHDFRPSHQVDWHGYDOXHRIµ5S¶IUHHRIRKPLFLQWHU
IHUHQFHV7KLVµ5S¶FDQEHXVHGIRUWKHGHWHUPLQDWLRQRIµLFRUU¶DQGKHQFHIRUHVWLPDWHV IHUHQFHV7KLVµ5S¶FDQEHXVHGIRUWKHGHWHUPLQDWLRQRIµLFRUU¶DQGKHQFHIRUHVWLPDWHV
RQWKHFRUURVLRQUDWHDVGHVFULEHGLQ6HFWLRQ RQWKHFRUURVLRQUDWHDVGHVFULEHGLQ6HFWLRQ
,QWKHIUHTXHQWFDVHRIOLPLWHGGLIIXVLRQLQWKHHOHFWURO\WHLHSUHVHQFHRIFRQFHQWUD ,QWKHIUHTXHQWFDVHRIOLPLWHGGLIIXVLRQLQWKHHOHFWURO\WHLHSUHVHQFHRIFRQFHQWUD
WLRQSRODULVDWLRQ FI6HFWLRQ ZKLFKLVRISDUWLFXODULPSRUWDQFHLQWKHFRQFUHWH WLRQSRODULVDWLRQ FI6HFWLRQ ZKLFKLVRISDUWLFXODULPSRUWDQFHLQWKHFRQFUHWH
HQYLURQPHQW FI6HFWLRQ DQDGGLWLRQDOUHVLVWLYHHOHPHQWWKHVRFDOOHG:DUEXUJ HQYLURQPHQW FI6HFWLRQ DQDGGLWLRQDOUHVLVWLYHHOHPHQWWKHVRFDOOHG:DUEXUJ
LPSHGDQFH µ:¶FDQEHLQFOXGHGLQWKH HTXLYDOHQWFLUFXLWVHH)LJXUH >%@ ,QWKH LPSHGDQFH µ:¶FDQEHLQFOXGHGLQWKH HTXLYDOHQWFLUFXLWVHH)LJXUH >%@ ,QWKH
1\TXLVWSORWµ:¶LVUHFRJQLVHGE\DVWUDLJKWOLQHZLWKDQDQJOHRIƒLQWKHORZHUIUH 1\TXLVWSORWµ:¶LVUHFRJQLVHGE\DVWUDLJKWOLQHZLWKDQDQJOHRIƒLQWKHORZHUIUH
TXHQF\UHJLRQ7KLVUHSUHVHQWDWLRQLVRIWHQUHIHUUHGWRDVWKH5DQGOHVFLUFXLW  TXHQF\UHJLRQ7KLVUHSUHVHQWDWLRQLVRIWHQUHIHUUHGWRDVWKH5DQGOHVFLUFXLW 
,Q LQYHVWLJDWLRQV RQ DTXHRXV PHWDOOLF FRUURVLRQ V\VWHPV W\SLFDO µ(,6¶ IUHTXHQF\ ,Q LQYHVWLJDWLRQV RQ DTXHRXV PHWDOOLF FRUURVLRQ V\VWHPV W\SLFDO µ(,6¶ IUHTXHQF\
UDQJHVDUHLQWKHRUGHURIN+]WR+]>$XWR/DE*DPU\@ UDQJHVDUHLQWKHRUGHURIN+]WR+]>$XWR/DE*DPU\@

 &KHPLFDODQG(OHFWURFKHPLFDO6XUIDFH0RGLILFDWLRQV  &KHPLFDODQG(OHFWURFKHPLFDO6XUIDFH0RGLILFDWLRQV


$OWKRXJKSHUVHQRFRUURVLRQSURFHVVHVPDQ\FKHPLFDODQGHOHFWURFKHPLFDOVXUIDFH $OWKRXJKSHUVHQRFRUURVLRQSURFHVVHVPDQ\FKHPLFDODQGHOHFWURFKHPLFDOVXUIDFH
PRGLILFDWLRQV DUH EDVHG RQ WKH WKHRU\ RI DTXHRXV PHWDOOLF FRUURVLRQ $PRQJ RWKHU PRGLILFDWLRQV DUH EDVHG RQ WKH WKHRU\ RI DTXHRXV PHWDOOLF FRUURVLRQ $PRQJ RWKHU
 

1DPHGDIWHU-RKQ(%5DQGOHV(QJODQG>+8-,@ 1DPHGDIWHU-RKQ(%5DQGOHV(QJODQG>+8-,@

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ &KHPLFDODQG(OHFWURFKHPLFDO6XUIDFH0RGLILFDWLRQV $TXHRXV0HWDOOLF&RUURVLRQ &KHPLFDODQG(OHFWURFKHPLFDO6XUIDFH0RGLILFDWLRQV

VXUIDFHFOHDQLQJSURFHVVHVGHJUHDVLQJDQGHWFKLQJKDYHEHHQLQYHVWLJDWHGLQWKHH[ VXUIDFHFOHDQLQJSURFHVVHVGHJUHDVLQJDQGHWFKLQJKDYHEHHQLQYHVWLJDWHGLQWKHH[
SHULPHQWDO SDUW RI WKLV SURMHFW 7KHVH WHFKQLTXHV DV ZHOO DV HOHFWURO\WLF SODWLQJ DUH SHULPHQWDO SDUW RI WKLV SURMHFW 7KHVH WHFKQLTXHV DV ZHOO DV HOHFWURO\WLF SODWLQJ DUH
EULHIO\RXWOLQHGLQWKLV6HFWLRQ%HVLGHVWKHVHVWDQGDUGSURFHVVHVDQXPEHURIVSHFLDO EULHIO\RXWOLQHGLQWKLV6HFWLRQ%HVLGHVWKHVHVWDQGDUGSURFHVVHVDQXPEHURIVSHFLDO
PDWHULDOFRQFHSWVDQGVXUIDFHWUHDWPHQWVPRGLILFDWLRQVKDYHEHHQGHVLJQHGDQGWHVWHG PDWHULDOFRQFHSWVDQGVXUIDFHWUHDWPHQWVPRGLILFDWLRQVKDYHEHHQGHVLJQHGDQGWHVWHG
H[SHULPHQWDOO\ LQ UHODWLRQ WR WKH GHYHORSPHQW RI QHZ FRXQWHUPHDVXUHV &KDSWHU   H[SHULPHQWDOO\ LQ UHODWLRQ WR WKH GHYHORSPHQW RI QHZ FRXQWHUPHDVXUHV &KDSWHU  
+RZHYHU ZLWK UHJDUG WR WKH H[SHFWHG SDWHQW SRVVLELOLWLHV FI 6HFWLRQ   GHVFULS +RZHYHU ZLWK UHJDUG WR WKH H[SHFWHG SDWHQW SRVVLELOLWLHV FI 6HFWLRQ   GHVFULS
WLRQVRIWKHVHFXVWRPGHVLJQHGSURFHVVHVDUHQRWLQFOXGHGLQWKHSUHVHQWWKHVLV WLRQVRIWKHVHFXVWRPGHVLJQHGSURFHVVHVDUHQRWLQFOXGHGLQWKHSUHVHQWWKHVLV

 6XUIDFH&OHDQLQJ  6XUIDFH&OHDQLQJ


$VIDUDVSRVVLEOHWKHVXUIDFHFOHDQLQJPHWKRGVZHDSSOLHGLQWKHH[SHULPHQWDOSDUW $VIDUDVSRVVLEOHWKHVXUIDFHFOHDQLQJPHWKRGVZHDSSOLHGLQWKHH[SHULPHQWDOSDUW
RI WKLV SURMHFW ZHUH EDVHG RQ >$670 % @ 6XUIDFH FOHDQLQJ RI UHLQIRUFLQJ RI WKLV SURMHFW ZHUH EDVHG RQ >$670 % @ 6XUIDFH FOHDQLQJ RI UHLQIRUFLQJ
VWHHOLVXVHGDVDSUHWUHDWPHQWLQFRQQHFWLRQZLWKUHLQIRUFHPHQWFRXQWHUPHDVXUHVLQ VWHHOLVXVHGDVDSUHWUHDWPHQWLQFRQQHFWLRQZLWKUHLQIRUFHPHQWFRXQWHUPHDVXUHVLQ
YROYLQJVXUIDFHPRGLILFDWLRQVVXFKDVJDOYDQLVDWLRQRUJDQLFFRDWLQJRUFODGGLQJ FI YROYLQJVXUIDFHPRGLILFDWLRQVVXFKDVJDOYDQLVDWLRQRUJDQLFFRDWLQJRUFODGGLQJ FI
6HFWLRQ EXWLWLVJHQHUDOO\QRWDSSOLHGDVDVLQJOHWUHDWPHQWLQSUDFWLFHDVWKH 6HFWLRQ EXWLWLVJHQHUDOO\QRWDSSOLHGDVDVLQJOHWUHDWPHQWLQSUDFWLFHDVWKH
JDLQ LQ FRUURVLRQ SURWHFWLRQ LV WHFKQLFDOO\ LQVLJQLILFDQW  1HYHUWKHOHVV WKH FRQGLWLRQ JDLQ LQ FRUURVLRQ SURWHFWLRQ LV WHFKQLFDOO\ LQVLJQLILFDQW  1HYHUWKHOHVV WKH FRQGLWLRQ
RIWKHHPEHGGHGPHWDOVXUIDFHKDVDVLJQLILFDQWHIIHFWRQWKHHOHFWURFKHPLVWU\LQFRQ RIWKHHPEHGGHGPHWDOVXUIDFHKDVDVLJQLILFDQWHIIHFWRQWKHHOHFWURFKHPLVWU\LQFRQ
FUHWHHJFRQFHUQLQJµ(FRUU¶DQGµ5S¶>.WHUHWDOE@:HWKLQNWKDWWKHVHDVSHFWV FUHWHHJFRQFHUQLQJµ(FRUU¶DQGµ5S¶>.WHUHWDOE@:HWKLQNWKDWWKHVHDVSHFWV
DOORZIRUDEHWWHUXQGHUVWDQGLQJRIWKHWKHUPRG\QDPLFSDUDPHWHUVDQGWKXVDOORZIRU DOORZIRUDEHWWHUXQGHUVWDQGLQJRIWKHWKHUPRG\QDPLFSDUDPHWHUVDQGWKXVDOORZIRU
FHUWDLQ FRQVLGHUDWLRQV IRU WKH GHVLJQ RI QHZ FRXQWHUPHDVXUHV +HQFH ZH TXDQWLILHG FHUWDLQ FRQVLGHUDWLRQV IRU WKH GHVLJQ RI QHZ FRXQWHUPHDVXUHV +HQFH ZH TXDQWLILHG
WKHVXUIDFHDQGPHWDOOXUJLFDOFKDUDFWHULVWLFVRIGLIIHUHQWUHLQIRUFHPHQWVWHHOTXDOLWLHV WKHVXUIDFHDQGPHWDOOXUJLFDOFKDUDFWHULVWLFVRIGLIIHUHQWUHLQIRUFHPHQWVWHHOTXDOLWLHV
DQGLQYHVWLJDWHGWKHHIIHFWRIGLYHUVHFDUERQVWHHOVXUIDFHWUHDWPHQWVRQWKHWKHUPR DQGLQYHVWLJDWHGWKHHIIHFWRIGLYHUVHFDUERQVWHHOVXUIDFHWUHDWPHQWVRQWKHWKHUPR
G\QDPLFVRIVWHHOLQFRQFUHWHLQDQH[SHULPHQWDOVWXG\WKDWDOVRLQFOXGHGRWKHUVWHHO G\QDPLFVRIVWHHOLQFRQFUHWHLQDQH[SHULPHQWDOVWXG\WKDWDOVRLQFOXGHGRWKHUVWHHO
TXDOLWLHVDQGJDOYDQLVDWLRQ7KHLQYHVWLJDWHGVWHHOVXUIDFHWUHDWPHQWVDQGVWHHOTXDOL TXDOLWLHVDQGJDOYDQLVDWLRQ7KHLQYHVWLJDWHGVWHHOVXUIDFHWUHDWPHQWVDQGVWHHOTXDOL
WLHVDUHEULHIO\GHVFULEHGLQ6HFWLRQDQGVHOHFWHGUHVXOWVRIWKHPHWDOOXUJLFDODQG WLHVDUHEULHIO\GHVFULEHGLQ6HFWLRQDQGVHOHFWHGUHVXOWVRIWKHPHWDOOXUJLFDODQG
WKHUPRG\QDPLF LQYHVWLJDWLRQV DUH JLYHQ LQ 6HFWLRQV  FDUERQ VWHHO  DQG WKHUPRG\QDPLF LQYHVWLJDWLRQV DUH JLYHQ LQ 6HFWLRQV  FDUERQ VWHHO  DQG
 VWDLQOHVVVWHHO %RWKLQYHVWLJDWLRQVZHUHSHUIRUPHGLQFORVHUHODWLRQWRWKH  VWDLQOHVVVWHHO %RWKLQYHVWLJDWLRQVZHUHSHUIRUPHGLQFORVHUHODWLRQWRWKH
WKHRU\RQWKHPHWDOOXUJLFDODQGVXUIDFHSURSHUWLHVRIFDUERQVWHHOZKLFKLVGHDOWZLWK WKHRU\RQWKHPHWDOOXUJLFDODQGVXUIDFHSURSHUWLHVRIFDUERQVWHHOZKLFKLVGHDOWZLWK
6HFWLRQ 6HFWLRQ

 'HJUHDVLQJ  'HJUHDVLQJ


7KHGHJUHDVLQJSURFHVVDLPVDWUHPRYDORIRLODQGORRVHGHILOHPHQWIURPWKHVXUIDFH 7KHGHJUHDVLQJSURFHVVDLPVDWUHPRYDORIRLODQGORRVHGHILOHPHQWIURPWKHVXUIDFH
'HJUHDVLQJLVQRUPDOO\SHUIRUPHGDVDWZRIROGSURFHVVFRQVLVWLQJRIGLSGHJUHDVLQJ 'HJUHDVLQJLVQRUPDOO\SHUIRUPHGDVDWZRIROGSURFHVVFRQVLVWLQJRIGLSGHJUHDVLQJ
DQGHOHFWURO\WLFGHJUHDVLQJ'LSGHJUHDVLQJUHPRYHVORRVHRLODQGGHILOHPHQWIURPWKH DQGHOHFWURO\WLFGHJUHDVLQJ'LSGHJUHDVLQJUHPRYHVORRVHRLODQGGHILOHPHQWIURPWKH
PHWDOVXUIDFHEHIRUHHOHFWURO\WLFGHJUHDVLQJLVDSSOLHGWRUHPRYHWKHUHPDLQLQJWKLQ PHWDOVXUIDFHEHIRUHHOHFWURO\WLFGHJUHDVLQJLVDSSOLHGWRUHPRYHWKHUHPDLQLQJWKLQ
JUHDVHILOP7KLFNILOPVFDQJHQHUDOO\QRWEHUHPRYHGE\HOHFWURO\WLFGHJUHDVLQJRQO\ JUHDVHILOP7KLFNILOPVFDQJHQHUDOO\QRWEHUHPRYHGE\HOHFWURO\WLFGHJUHDVLQJRQO\
VLQFHWKHFXUUHQWWUDQVIHULVOLPLWHG>6WUHHE +RIIPDQQ@ VLQFHWKHFXUUHQWWUDQVIHULVOLPLWHG>6WUHHE +RIIPDQQ@
 

2QWKHFRQWUDU\UHLQIRUFLQJVWHHOLVRIWHQLQWHQWLRQDOO\H[SRVHGWRWKHDWPRVSKHUHWRDWWDLQDFHUWDLQ 2QWKHFRQWUDU\UHLQIRUFLQJVWHHOLVRIWHQLQWHQWLRQDOO\H[SRVHGWRWKHDWPRVSKHUHWRDWWDLQDFHUWDLQ
GHJUHHRISUHFRUURVLRQZKLFKVXSSRVHGO\LQFUHDVHVWKHURXJKQHVVDQGWKXVOHDGVWREHWWHUERQGSURS GHJUHHRISUHFRUURVLRQZKLFKVXSSRVHGO\LQFUHDVHVWKHURXJKQHVVDQGWKXVOHDGVWREHWWHUERQGSURS
HUWLHV+RZHYHUFRQVLGHULQJWKDWDOPRVWDOOUHLQIRUFHPHQWLVSURGXFHGIURPULEEHGEDUVQRZDGD\V HUWLHV+RZHYHUFRQVLGHULQJWKDWDOPRVWDOOUHLQIRUFHPHQWLVSURGXFHGIURPULEEHGEDUVQRZDGD\V
ZHWKLQNWKDWWKHJDLQLQERQGREWDLQHGIURPSUHFRUURVLRQLVUDWKHUQHJOLJLEOHDVWKHLQWHUORFNLQJEH ZHWKLQNWKDWWKHJDLQLQERQGREWDLQHGIURPSUHFRUURVLRQLVUDWKHUQHJOLJLEOHDVWKHLQWHUORFNLQJEH
WZHHQWKHFRQFUHWHDQGWKHVWHHODFKLHYHGE\WKHULEVSURYLGHVIRUHIIHFWLYHIRUFHWUDQVIHU WZHHQWKHFRQFUHWHDQGWKHVWHHODFKLHYHGE\WKHULEVSURYLGHVIRUHIIHFWLYHIRUFHWUDQVIHU

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&KHPLFDODQG(OHFWURFKHPLFDO6XUIDFH0RGLILFDWLRQV $TXHRXV0HWDOOLF&RUURVLRQ &KHPLFDODQG(OHFWURFKHPLFDO6XUIDFH0RGLILFDWLRQV $TXHRXV0HWDOOLF&RUURVLRQ

7KHGLSGHJUHDVLQJVROXWLRQFRQWDLQVGLIIHUHQWEDVHFRPSRQHQWV EXLOGHUV DQGDQDG 7KHGLSGHJUHDVLQJVROXWLRQFRQWDLQVGLIIHUHQWEDVHFRPSRQHQWV EXLOGHUV DQGDQDG


YDQFHGV\VWHPRIGHWHUJHQWV7KHGHWHUJHQWFRQVLVWLQJRIDK\GURSKLOLFDQGDK\GUR YDQFHGV\VWHPRIGHWHUJHQWV7KHGHWHUJHQWFRQVLVWLQJRIDK\GURSKLOLFDQGDK\GUR
SKRELFSDUWVHH)LJXUH>$@HPXOVLILHVRLODQGJUHDVHLQZDWHU7KH K\GURSKLOLF SKRELFSDUWVHH)LJXUH>$@HPXOVLILHVRLODQGJUHDVHLQZDWHU 7KH K\GURSKLOLF
SDUWRIWKHPROHFXOHLVDFKHPLFDOFRPSRXQGFRPPRQO\DQDFLGJURXSWKDWSUHVHQWVD SDUWRIWKHPROHFXOHLVDFKHPLFDOFRPSRXQGFRPPRQO\DQDFLGJURXSWKDWSUHVHQWVD
ODUJHDIILQLW\WRZDWHUZKLOHWKHK\GURSKRELFSDUWKDVDVWURQJDIILQLW\WRRLO7KHK\ ODUJHDIILQLW\WRZDWHUZKLOHWKHK\GURSKRELFSDUWKDVDVWURQJDIILQLW\WRRLO7KHK\
GURSKRELFSDUWLQWUXGHVLQWRRLODQGJUHDVHWRH[WUDFWLWDVZHOODVRWKHUORRVHGHILOH GURSKRELFSDUWLQWUXGHVLQWRRLODQGJUHDVHWRH[WUDFWLWDVZHOODVRWKHUORRVHGHILOH
PHQWLQWRWKHZDWHUDVLOOXVWUDWHGLQ)LJXUH>%@DQG>&@>0¡OOHUF@ PHQWLQWRWKHZDWHUDVLOOXVWUDWHGLQ)LJXUH>%@DQG>&@>0¡OOHUF@

 
)LJXUH 'HJUHDVLQJ LQ DONDOLQH EDWK $IWHU >0¡OOHU F@ >$@ 'HWHUJHQW )LJXUH 'HJUHDVLQJ LQ DONDOLQH EDWK $IWHU >0¡OOHU F@ >$@ 'HWHUJHQW
FRQVLVWLQJ RI FRPSRXQG ZLWK K\GURSKLOLF DQG K\GURSKRELF SDUW >%@ FRQVLVWLQJ RI FRPSRXQG ZLWK K\GURSKLOLF DQG K\GURSKRELF SDUW >%@
+\GURSKRELF SDUW LQWUXGHV RLO DQG JUHDVH >&@ +\GURSKRELF SDUW +\GURSKRELF SDUW LQWUXGHV RLO DQG JUHDVH >&@ +\GURSKRELF SDUW
HPXOVLILHVRLODQGJUHDVHDQGRWKHUORRVHGHILOHPHQW HPXOVLILHVRLODQGJUHDVHDQGRWKHUORRVHGHILOHPHQW
7KHIXQFWLRQRIWKHEXLOGHUVLVWRVXVSHQGWKHSDUWLFOHVLQWKHVROXWLRQDQGWRDYRLGWKDW 7KHIXQFWLRQRIWKHEXLOGHUVLVWRVXVSHQGWKHSDUWLFOHVLQWKHVROXWLRQDQGWRDYRLGWKDW
WKHVHSUHFLSLWDWHRQWKHPHWDOVXUIDFHDJDLQ%XLOGHUVDUHQRUPDOO\FRPSRVHGRIVWDEOH WKHVHSUHFLSLWDWHRQWKHPHWDOVXUIDFHDJDLQ%XLOGHUVDUHQRUPDOO\FRPSRVHGRIVWDEOH
PL[WXUHVRIVLOLFDWHFRPSRXQGVDQGSRO\SKRVSKDWHV>0¡OOHUF@ PL[WXUHVRIVLOLFDWHFRPSRXQGVDQGSRO\SKRVSKDWHV>0¡OOHUF@
:KLOHGLSGHJUHDVLQJLVPHUHO\EDVHGRQFKHPLFDOSULQFLSOHVHOHFWURO\WLFGHJUHDVLQJ :KLOHGLSGHJUHDVLQJLVPHUHO\EDVHGRQFKHPLFDOSULQFLSOHVHOHFWURO\WLFGHJUHDVLQJ
LVODUJHO\EDVHGRQWKHHOHFWURFKHPLFDOWKHRU\GHVFULEHGWKURXJKRXW6HFWLRQVDQG LVODUJHO\EDVHGRQWKHHOHFWURFKHPLFDOWKHRU\GHVFULEHGWKURXJKRXW6HFWLRQVDQG
'XULQJHOHFWURO\WLF GHJUHDVLQJWKHPHWDOLV VXEPHUJHGLQDQDONDOLQHHOHFWURO\WH 'XULQJHOHFWURO\WLF GHJUHDVLQJWKHPHWDOLV VXEPHUJHGLQDQDONDOLQHHOHFWURO\WH
DQG HLWKHU FDWKRGLFDOO\ RU DQRGLFDOO\ SRODULVHG FI 6HFWLRQ   7KDW ZD\ HLWKHU DQG HLWKHU FDWKRGLFDOO\ RU DQRGLFDOO\ SRODULVHG FI 6HFWLRQ   7KDW ZD\ HLWKHU
K\GURJHQ RU R[\JHQ HYROXWLRQ WDNHV SODFH RQ WKH PHWDO VXUIDFH FI 6HFWLRQ   K\GURJHQ RU R[\JHQ HYROXWLRQ WDNHV SODFH RQ WKH PHWDO VXUIDFH FI 6HFWLRQ  
ZKLFK³EXUVWVRII´UHPDLQLQJJUHDVHRLODQGGHILOHPHQW7KHIROORZLQJKDOIFHOOUHDF ZKLFK³EXUVWVRII´UHPDLQLQJJUHDVHRLODQGGHILOHPHQW7KHIROORZLQJKDOIFHOOUHDF
WLRQVWDNHSODFHRQWKHPHWDOVXUIDFH WLRQVWDNHSODFHRQWKHPHWDOVXUIDFH
$QRGLFGHJUHDVLQJ $QRGLFGHJUHDVLQJ

2+ − → 2 + +  2 + H− (( 
 =  {} P96+( )  >@ 2+ − → 2 + +  2 + H− (( 
 =  {} P96+( )  >@

&DWKRGLFGHJUHDVLQJ &DWKRGLFGHJUHDVLQJ

+  2 + H− → +  + 2+ − (( 
 = −  ^−` P96+( )  >@ +  2 + H− → +  + 2+ − (( 
 = −  ^−` P96+( )  >@

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ &KHPLFDODQG(OHFWURFKHPLFDO6XUIDFH0RGLILFDWLRQV $TXHRXV0HWDOOLF&RUURVLRQ &KHPLFDODQG(OHFWURFKHPLFDO6XUIDFH0RGLILFDWLRQV

)RU FDUERQ VWHHO GHJUHDVLQJ LV DOZD\V SHUIRUPHG DQRGLF VLQFH WKH FDWKRGLF SURFHVV )RU FDUERQ VWHHO GHJUHDVLQJ LV DOZD\V SHUIRUPHG DQRGLF VLQFH WKH FDWKRGLF SURFHVV
RIWHQLQYROYHVUHGXFWLRQRIVROYHGKHDY\PHWDOVRQWKHVXUIDFHZKLFKPLJKWOHDGWRD RIWHQLQYROYHVUHGXFWLRQRIVROYHGKHDY\PHWDOVRQWKHVXUIDFHZKLFKPLJKWOHDGWRD
VOXGJHOLNHGHSRVLWLRQ+RZHYHUFDWKRGLFGHJUHDVLQJLVRIWHQDSSOLHGIRUQREOHUPHW VOXGJHOLNHGHSRVLWLRQ+RZHYHUFDWKRGLFGHJUHDVLQJLVRIWHQDSSOLHGIRUQREOHUPHW
DOVHJVWDLQOHVVVWHHO>0¡OOHUF@ DOVHJVWDLQOHVVVWHHO>0¡OOHUF@
$QH[DPSOHIRUDQRGLFGHJUHDVLQJRIFDUERQVWHHOVDPSOHVZLWKLQWHQVHK\GURJHQHYR $QH[DPSOHIRUDQRGLFGHJUHDVLQJRIFDUERQVWHHOVDPSOHVZLWKLQWHQVHK\GURJHQHYR
OXWLRQRQWKHFDWKRGHLVVKRZQLQ)LJXUH>$@ OXWLRQRQWKHFDWKRGHLVVKRZQLQ)LJXUH>$@

 
)LJXUH (OHFWURO\WLFGHJUHDVLQJRIFDUERQVWHHOVDPSOHV >$@ $QRGLFGHJUHDV )LJXUH (OHFWURO\WLFGHJUHDVLQJRIFDUERQVWHHOVDPSOHV >$@ $QRGLFGHJUHDV
LQJRIUHEDUVDPSOHVLQDONDOLQHEDWK>%@ $FLGSLFNOLQJRIUHEDUVDP LQJRIUHEDUVDPSOHVLQDONDOLQHEDWK>%@ $FLGSLFNOLQJRIUHEDUVDP
SOHV SOHV
$IWHUHOHFWURO\WLFGHJUHDVLQJDQGZDWHUULQVLQJ DIWHUHDFKVWHSLQWKHSURFHVV DQHX $IWHUHOHFWURO\WLFGHJUHDVLQJDQGZDWHUULQVLQJ DIWHUHDFKVWHSLQWKHSURFHVV DQHX
WUDOLVDWLRQSURFHVVLQDQDFLGEDWKJHQHUDOO\UHIHUUHGWRDVDFLGSLFNOLQJLVSHUIRUPHG WUDOLVDWLRQSURFHVVLQDQDFLGEDWKJHQHUDOO\UHIHUUHGWRDVDFLGSLFNOLQJLVSHUIRUPHG
,QWKLVSURFHVVUHDPLQJDONDOLQHSURGXFWVDQGR[LGHV LQSULQFLSOHSDVVLYHOD\HUVFI ,QWKLVSURFHVVUHDPLQJDONDOLQHSURGXFWVDQGR[LGHV LQSULQFLSOHSDVVLYHOD\HUVFI
6HFWLRQ   ZKLFK PLJKW KDYH HYROYHG ZLWK R[\JHQ HYROXWLRQ GXULQJ WKH DQRGLF 6HFWLRQ   ZKLFK PLJKW KDYH HYROYHG ZLWK R[\JHQ HYROXWLRQ GXULQJ WKH DQRGLF
FOHDQLQJSURFHVVDUHUHPRYHG7KHDSSOLHGQHXWUDOLVDWLRQVROXWLRQVDUHRIWHQEDVHGRQ FOHDQLQJSURFHVVDUHUHPRYHG7KHDSSOLHGQHXWUDOLVDWLRQVROXWLRQVDUHRIWHQEDVHGRQ
VXOSKDWHEXIIHUV\VWHPV +62ļ62 ZLWKDS+DURXQGDQGIOXRULGHVDOWV6XFK VXOSKDWHEXIIHUV\VWHPV +62ļ62 ZLWKDS+DURXQGDQGIOXRULGHVDOWV6XFK
VROXWLRQVDUHHIIHFWLYHIRUUHPRYDORIWKLQR[LGHOD\HUVDVWKH\LPPHGLDWHO\WUDQVIRUP VROXWLRQVDUHHIIHFWLYHIRUUHPRYDORIWKLQR[LGHOD\HUVDVWKH\LPPHGLDWHO\WUDQVIRUP
LURQR[LGHVWRVROXEOHIOXRULGHFRPSOH[HVRILURQHJ LURQR[LGHVWRVROXEOHIOXRULGHFRPSOH[HVRILURQHJ

)H 2 + + + + )− → )H) + + +  2 ( Δ* 


= −  N- )  >@ )H 2 + + + + )− → )H) + + +  2 ( Δ* 
= −  N- )  >@

$QH[DPSOHIRUDFLGSLFNOLQJRIFDUERQVWHHOVDPSOHVZLWKPRGHUDWHR[\JHQHYROXWLRQ $QH[DPSOHIRUDFLGSLFNOLQJRIFDUERQVWHHOVDPSOHVZLWKPRGHUDWHR[\JHQHYROXWLRQ
RQWKHPHWDOVXUIDFHLVJLYHQLQ)LJXUH>%@ RQWKHPHWDOVXUIDFHLVJLYHQLQ)LJXUH>%@

 (WFKLQJ  (WFKLQJ


%HVLGHVVXOSKXULFDFLGK\GURFKORULFDFLGZKLFKZDVDOVRDSSOLHGLQWKHH[SHULPHQWDO %HVLGHVVXOSKXULFDFLGK\GURFKORULFDFLGZKLFKZDVDOVRDSSOLHGLQWKHH[SHULPHQWDO
SDUWRIWKLVSURMHFWLVWKHPRVWLPSRUWDQWHWFKLQJDJHQWIRUVWHHO*HQHUDOO\VROXWLRQV SDUWRIWKLVSURMHFWLVWKHPRVWLPSRUWDQWHWFKLQJDJHQWIRUVWHHO*HQHUDOO\VROXWLRQV
LQFRQFHQWUDWLRQVIURPWRDUHXVHGIRUVXOSKXULFDQGK\GURFKORULFDFLGHWFK LQFRQFHQWUDWLRQVIURPWRDUHXVHGIRUVXOSKXULFDQGK\GURFKORULFDFLGHWFK
LQJ>6WUDVFKLOO@7KHIROORZLQJFKHPLFDOSURFHVVHVDUHFRQVLGHUHGWRWDNHSODFH LQJ>6WUDVFKLOO@7KHIROORZLQJFKHPLFDOSURFHVVHVDUHFRQVLGHUHGWRWDNHSODFH
GXULQJHWFKLQJRIFDUERQVWHHO>0¡OOHUF@ GXULQJHWFKLQJRIFDUERQVWHHO>0¡OOHUF@
‡ 6XOSKXULFDFLGHWFKLQJ ‡ 6XOSKXULFDFLGHWFKLQJ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&KHPLFDODQG(OHFWURFKHPLFDO6XUIDFH0RGLILFDWLRQV $TXHRXV0HWDOOLF&RUURVLRQ &KHPLFDODQG(OHFWURFKHPLFDO6XUIDFH0RGLILFDWLRQV $TXHRXV0HWDOOLF&RUURVLRQ

 )H  2 + + 62  → )H 62   + +  2 ( Δ* 
= −  N- )  >@  )H  2 + + 62  → )H 62   + +  2 ( Δ* 
= −  N- )  >@

 )H2 + + 62  → )H62  + + 2 ( Δ* 


= −  N- )  >@  )H2 + + 62  → )H62  + + 2 ( Δ* 
= −  N- )  >@

 )H + + 62  → )H62  + +  ( Δ* 
= −  N- )  >@  )H + + 62  → )H62  + +  ( Δ* 
= −  N- )  >@

‡ +\GURFKORULFDFLGHWFKLQJ ‡ +\GURFKORULFDFLGHWFKLQJ

 )H 2 + +&O → )H&O+ + &O− + +  2 ( Δ* 


= −  N- )  >@  )H 2 + +&O → )H&O+ + &O− + +  2 ( Δ* 
= −  N- )  >@

 )H2 + +&O → )H&O  + +  2 ( Δ* 


= −  N- )  >@  )H2 + +&O → )H&O  + +  2 ( Δ* 
= −  N- )  >@

 )H + +&O → )H&O  + +  ( Δ* 
= −  N- )  >@  )H + +&O → )H&O  + +  ( Δ* 
= −  N- )  >@

7KH GLVVROXWLRQ RI LURQ GHVFULEHG E\ UHDFWLRQ >@ FDQ EH GDPSHG E\ DGGLWLRQ RI 7KH GLVVROXWLRQ RI LURQ GHVFULEHG E\ UHDFWLRQ >@ FDQ EH GDPSHG E\ DGGLWLRQ RI
HWFKLQJLQKLELWRUVZKLFKDUHFDSDEOHRIVORZLQJGRZQWKHLURQGLVVROXWLRQK\GURJHQ HWFKLQJLQKLELWRUVZKLFKDUHFDSDEOHRIVORZLQJGRZQWKHLURQGLVVROXWLRQK\GURJHQ
LRQUHGXFWLRQ>0¡OOHUF@ LRQUHGXFWLRQ>0¡OOHUF@

 (OHFWURO\WLF3ODWLQJ  (OHFWURO\WLF3ODWLQJ


(OHFWURO\WLF SODWLQJ KHQFHIRUWK HOHFWURSODWLQJ  LV DQRWKHU EHQHILFLDO DSSOLFDWLRQ RI (OHFWURO\WLF SODWLQJ KHQFHIRUWK HOHFWURSODWLQJ  LV DQRWKHU EHQHILFLDO DSSOLFDWLRQ RI
HOHFWURFKHPLFDO³FRUURVLRQ´SURFHVVHV7KLVVHFWLRQSURYLGHVDVLPSOLILHGGHVFULSWLRQ HOHFWURFKHPLFDO³FRUURVLRQ´SURFHVVHV7KLVVHFWLRQSURYLGHVDVLPSOLILHGGHVFULSWLRQ
RIWKHHOHFWURSODWLQJSURFHVVHVDSSOLHGLQWKHH[SHULPHQWDOSDUWRIWKLVSURMHFW RIWKHHOHFWURSODWLQJSURFHVVHVDSSOLHGLQWKHH[SHULPHQWDOSDUWRIWKLVSURMHFW
,Q DQ HOHFWURSODWLQJ FHOO WKH SODWLQJ PHWDO LV XVHG DV DQRGH DQG WKH FDWKRGH FRUUH ,Q DQ HOHFWURSODWLQJ FHOO WKH SODWLQJ PHWDO LV XVHG DV DQRGH DQG WKH FDWKRGH FRUUH
VSRQGV WR WKH PHWDO WR EH SODWHG 7KH UHTXLUHG DQRGLF DQG FDWKRGLF SRODULVDWLRQ FI VSRQGV WR WKH PHWDO WR EH SODWHG 7KH UHTXLUHG DQRGLF DQG FDWKRGLF SRODULVDWLRQ FI
6HFWLRQ LVDFKLHYHGE\DQH[WHUQDOVXSSO\RIGLUHFWFXUUHQW µ'&¶ LHWKHDQRGH 6HFWLRQ LVDFKLHYHGE\DQH[WHUQDOVXSSO\RIGLUHFWFXUUHQW µ'&¶ LHWKHDQRGH
LVFRQQHFWHGWRWKHSRVLWLYHWHUPLQDORIDFXUUHQWVXSSO\DQGWKHFDWKRGHLVFRQQHFWHG LVFRQQHFWHGWRWKHSRVLWLYHWHUPLQDORIDFXUUHQWVXSSO\DQGWKHFDWKRGHLVFRQQHFWHG
WRWKHQHJDWLYH JURXQG WHUPLQDOVHH)LJXUH WRWKHQHJDWLYH JURXQG WHUPLQDOVHH)LJXUH

 
)LJXUH (OHFWURSODWLQJRI]LQFRQJULWEODVWHGVPRRWKFDUERQVWHHOUHEDUVDP )LJXUH (OHFWURSODWLQJRI]LQFRQJULWEODVWHGVPRRWKFDUERQVWHHOUHEDUVDP
SOH FIVSHFLPHQW\SHV³&:´DQG³&:´LQ6HFWLRQ  SOH FIVSHFLPHQW\SHV³&:´DQG³&:´LQ6HFWLRQ 
:KHQFXUUHQWLVVXSSOLHGWRWKHFHOOWKHPHWDODQRGHLVR[LGLVHGIURPWKH]HURR[LGD :KHQFXUUHQWLVVXSSOLHGWRWKHFHOOWKHPHWDODQRGHLVR[LGLVHGIURPWKH]HURR[LGD
WLRQVWDWHWRIRUPFDWLRQVZLWKDSRVLWLYHFKDUJH FI6HFWLRQ  WLRQVWDWHWRIRUPFDWLRQVZLWKDSRVLWLYHFKDUJH FI6HFWLRQ 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$TXHRXV0HWDOOLF&RUURVLRQ &KHPLFDODQG(OHFWURFKHPLFDO6XUIDFH0RGLILFDWLRQV $TXHRXV0HWDOOLF&RUURVLRQ &KHPLFDODQG(OHFWURFKHPLFDO6XUIDFH0RGLILFDWLRQV

0H → 0H Q + + QH −  >@ 0H → 0H Q + + QH −  >@

7KHPHWDOFDWLRQVDVVRFLDWHZLWKDQLRQVLQWKHHOHFWURO\WHDQGDUHHYHQWXDOO\UHGXFHG 7KHPHWDOFDWLRQVDVVRFLDWHZLWKDQLRQVLQWKHHOHFWURO\WHDQGDUHHYHQWXDOO\UHGXFHG
DWWKHFDWKRGHWRGHSRVLWLQWKHPHWDOOLFIRUPRQLWVVXUIDFH DWWKHFDWKRGHWRGHSRVLWLQWKHPHWDOOLFIRUPRQLWVVXUIDFH

0H Q + + QH − → 0H  >@ 0H Q + + QH − → 0H  >@

0DQ\SODWLQJEDWKVLQFOXGHF\DQLGHVRIWKHPHWDOWREHGHSRVLWHGDVZHOODVF\DQLGHV 0DQ\SODWLQJEDWKVLQFOXGHF\DQLGHVRIWKHPHWDOWREHGHSRVLWHGDVZHOODVF\DQLGHV
RI RWKHU PHWDOV HJ SRWDVVLXP F\DQLGH 7KHVH IUHH F\DQLGHV IDFLOLWDWH GLVVROXWLRQ DW RI RWKHU PHWDOV HJ SRWDVVLXP F\DQLGH 7KHVH IUHH F\DQLGHV IDFLOLWDWH GLVVROXWLRQ DW
WKHDQRGHDQGWKHUHE\IDFLOLWDWHWRPDLQWDLQDFRQVWDQWPHWDOLRQOHYHOLQWKHHOHFWUR WKHDQRGHDQGWKHUHE\IDFLOLWDWHWRPDLQWDLQDFRQVWDQWPHWDOLRQOHYHOLQWKHHOHFWUR
O\WHDQGFRQWULEXWHWRWKHFRQGXFWLYLW\RIWKHEDWK$GGLWLRQDOO\QRQPHWDOFKHPLFDOV O\WHDQGFRQWULEXWHWRWKHFRQGXFWLYLW\RIWKHEDWK$GGLWLRQDOO\QRQPHWDOFKHPLFDOV
VXFK DV FDUERQDWHV DQG SKRVSKDWHV DUH RIWHQ DGGHG WR LQFUHDVH WKH FRQGXFWLYLW\ VXFK DV FDUERQDWHV DQG SKRVSKDWHV DUH RIWHQ DGGHG WR LQFUHDVH WKH FRQGXFWLYLW\
>0¡OOHUF@%HVLGHVWKHVHVWDQGDUGFRPSRXQGVSODWLQJEDWKVFDQFRQWDLQYDULRXV >0¡OOHUF@%HVLGHVWKHVHVWDQGDUGFRPSRXQGVSODWLQJEDWKVFDQFRQWDLQYDULRXV
RWKHU VXEVWDQFHV HJ WR DFKLHYH FHUWDLQ FKDUDFWHULVWLFV RI WKH SODWLQJ +HQFH WKH RWKHU VXEVWDQFHV HJ WR DFKLHYH FHUWDLQ FKDUDFWHULVWLFV RI WKH SODWLQJ +HQFH WKH
FKHPLFDOHTXLOLEULDLQWKHEDWKVEHFRPHUDWKHUFRPSOH[)RUGHWDLOHGLQIRUPDWLRQRQ FKHPLFDOHTXLOLEULDLQWKHEDWKVEHFRPHUDWKHUFRPSOH[)RUGHWDLOHGLQIRUPDWLRQRQ
WKHVHDQGRWKHUDVSHFWVUHIHUHQFHLVPDGHWRVWDQGDUGERRNVFRQFHUQLQJHOHFWURSODWLQJ WKHVHDQGRWKHUDVSHFWVUHIHUHQFHLVPDGHWRVWDQGDUGERRNVFRQFHUQLQJHOHFWURSODWLQJ
HJ>.DQDQL@ RUJHQHUDOVXUIDFHWHFKQRORJ\ HJ>0¡OOHUF@  HJ>.DQDQL@ RUJHQHUDOVXUIDFHWHFKQRORJ\ HJ>0¡OOHUF@ 
7KH FXUUHQW GHQVLW\ KDV D PDMRU LQIOXHQFH RQ WKH GHSRVLWLRQ UDWH SODWLQJ DGKHUHQFH 7KH FXUUHQW GHQVLW\ KDV D PDMRU LQIOXHQFH RQ WKH GHSRVLWLRQ UDWH SODWLQJ DGKHUHQFH
DQGSODWLQJTXDOLW\0RUHRYHUWKHFXUUHQWGHQVLW\YDULHVVLJQLILFDQWO\RYHUWKHFDWKRGH DQGSODWLQJTXDOLW\0RUHRYHUWKHFXUUHQWGHQVLW\YDULHVVLJQLILFDQWO\RYHUWKHFDWKRGH
VXUIDFH RXWVLGH VXUIDFHV WHQG WR KDYH D KLJKHU FXUUHQW GHQVLW\ WKDQ LQVLGH VXUIDFHV VXUIDFH RXWVLGH VXUIDFHV WHQG WR KDYH D KLJKHU FXUUHQW GHQVLW\ WKDQ LQVLGH VXUIDFHV
HJKROHVERUHVHWF 7KHKLJKHUWKHFXUUHQWGHQVLW\WKHIDVWHUWKHGHSRVLWLRQUDWH HJKROHVERUHVHWF 7KHKLJKHUWKHFXUUHQWGHQVLW\WKHIDVWHUWKHGHSRVLWLRQUDWH
EXWWKHUHLVDSUDFWLFDOOLPLWHQIRUFHGE\SRRUDGKHVLRQDQGSODWLQJTXDOLW\ZKHQWKH EXWWKHUHLVDSUDFWLFDOOLPLWHQIRUFHGE\SRRUDGKHVLRQDQGSODWLQJTXDOLW\ZKHQWKH
GHSRVLWLRQ UDWH LV WRR KLJK 5HFRPPHQGHG FXUUHQW GHQVLWLHV IRU GLIIHUHQW PHWDOV DQG GHSRVLWLRQ UDWH LV WRR KLJK 5HFRPPHQGHG FXUUHQW GHQVLWLHV IRU GLIIHUHQW PHWDOV DQG
HOHFWURO\WHV FDQ EH IRXQG LQ WKH OLWHUDWXUH HJ >.DQDQL @ )LQDOO\ LW VKRXOG EH HOHFWURO\WHV FDQ EH IRXQG LQ WKH OLWHUDWXUH HJ >.DQDQL @ )LQDOO\ LW VKRXOG EH
QRWHGWKDWFXUUHQWGHQVLWLHVDSSOLHGLQHOHFWURSODWLQJGHYLDWHODUJHO\IURPWKHH[FKDQJH QRWHGWKDWFXUUHQWGHQVLWLHVDSSOLHGLQHOHFWURSODWLQJGHYLDWHODUJHO\IURPWKHH[FKDQJH
FXUUHQWGHQVLWLHVPHQWLRQHGLQ6HFWLRQ )RULQVWDQFHWKHGLVVROXWLRQRI]LQFLQ FXUUHQWGHQVLWLHVPHQWLRQHGLQ6HFWLRQ )RULQVWDQFHWKHGLVVROXWLRQRI]LQFLQ
VXOSKXULFDFLGWDNHSODFHVZLWKDERXW×í$FP FI6HFWLRQ FRPSDUHGWR VXOSKXULFDFLGWDNHSODFHVZLWKDERXW×í$FP FI6HFWLRQ FRPSDUHGWR
×í$FPIRUGHSRVLWLRQRI]LQFLQDQDFLGEDWK>0¡OOHUF@ ×í$FPIRUGHSRVLWLRQRI]LQFLQDQDFLGEDWK>0¡OOHUF@
,QWKHH[SHULPHQWDOSDUWRIWKHSURMHFW]LQFFRDWLQJRIFDUERQVWHHOUHEDUZDVRQHRI ,QWKHH[SHULPHQWDOSDUWRIWKHSURMHFW]LQFFRDWLQJRIFDUERQVWHHOUHEDUZDVRQHRI
WKHDSSOLHGHOHFWURSODWLQJSURFHVVHV(OHFWURSODWLQJZDVSUHIHUUHGWRRWKHUJDOYDQLVD WKHDSSOLHGHOHFWURSODWLQJSURFHVVHV(OHFWURSODWLQJZDVSUHIHUUHGWRRWKHUJDOYDQLVD
WLRQSURFHVVHVLHKRWGLSSLQJRUWKHUPDOVSUD\LQJ FI6HFWLRQ GXHWRLWVORZ WLRQSURFHVVHVLHKRWGLSSLQJRUWKHUPDOVSUD\LQJ FI6HFWLRQ GXHWRLWVORZ
SURFHVVWHPSHUDWXUHDQGWKHSRVVLEOHSUHFLVHFRQWURORIWKHOD\HUWKLFNQHVV7KHVHWZR SURFHVVWHPSHUDWXUHDQGWKHSRVVLEOHSUHFLVHFRQWURORIWKHOD\HUWKLFNQHVV7KHVHWZR
DVSHFWVZHUHLPSRUWDQWDVDSSOLFDWLRQRIWKLQDQGFRQWUROOHGOD\HUVZDVIHDVLEOHZLWK DVSHFWVZHUHLPSRUWDQWDVDSSOLFDWLRQRIWKLQDQGFRQWUROOHGOD\HUVZDVIHDVLEOHZLWK
RXW LQWHUIHUHQFH DQG KHQFH DOORZLQJ IRU SHUIRUPDQFH FRPSDULVRQ ZLWK RWKHU VXUIDFH RXW LQWHUIHUHQFH DQG KHQFH DOORZLQJ IRU SHUIRUPDQFH FRPSDULVRQ ZLWK RWKHU VXUIDFH
WUHDWPHQWVPRGLILFDWLRQV FI 6HFWLRQ   7KH =Q)H OD\HU FI 6HFWLRQ   DV WUHDWPHQWVPRGLILFDWLRQV FI 6HFWLRQ   7KH =Q)H OD\HU FI 6HFWLRQ   DV
IRUPHG LQ KRWGLS JDOYDQLVLQJ GRHV QRW H[LVW EHQHDWK HOHFWURSODWHG ]LQF 6R =Q)H IRUPHG LQ KRWGLS JDOYDQLVLQJ GRHV QRW H[LVW EHQHDWK HOHFWURSODWHG ]LQF 6R =Q)H
FRPSOH[HVZKLFKZHFRQVLGHUWRSURYLGHIRUODUJHO\LPSURYHG FRUURVLRQUHVLVWDQFH FRPSOH[HVZKLFKZHFRQVLGHUWRSURYLGHIRUODUJHO\LPSURYHG FRUURVLRQUHVLVWDQFH
FDQRQO\EHIRUPHGIURPLRQVRIWKH]LQFOD\HU ZLWKDYHU\OLPLWHGWKLFNQHVVRI—P FDQRQO\EHIRUPHGIURPLRQVRIWKH]LQFOD\HU ZLWKDYHU\OLPLWHGWKLFNQHVVRI—P
LQRXULQYHVWLJDWLRQVFI6HFWLRQVDQG FRPELQLQJZLWKLURQLRQVIURPWKH LQRXULQYHVWLJDWLRQVFI6HFWLRQVDQG FRPELQLQJZLWKLURQLRQVIURPWKH
VXEVWUDWH7KHVHDQGRWKHUDVSHFWVRI]LQFDUHGHVFULEHGZLWKSDUWLFXODUUHJDUGWRDS VXEVWUDWH7KHVHDQGRWKHUDVSHFWVRI]LQFDUHGHVFULEHGZLWKSDUWLFXODUUHJDUGWRDS
SOLFDWLRQLQWKHFRQFUHWHHQYLURQPHQWLQ6HFWLRQV JHQHUDOWKHRU\DQGDYDLODEOH SOLFDWLRQLQWKHFRQFUHWHHQYLURQPHQWLQ6HFWLRQV JHQHUDOWKHRU\DQGDYDLODEOH
FRXQWHUPHDVXUHV DQG RXUDSSOLFDWLRQLQWKHSURSRVHGQHZFRXQWHUPHDVXUHV  FRXQWHUPHDVXUHV DQG RXUDSSOLFDWLRQLQWKHSURSRVHGQHZFRXQWHUPHDVXUHV 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 

 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ  3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ
6WHHO 6WHHO
&RQVLGHULQJWKHPXOWLIDFHWHGFKHPLVWU\RIFRQFUHWHDQGLWVSDUWLFXODUSK\VLFDOFKDUDF &RQVLGHULQJWKHPXOWLIDFHWHGFKHPLVWU\RIFRQFUHWHDQGLWVSDUWLFXODUSK\VLFDOFKDUDF
WHULVWLFV DV ZHOO DV WKH PHWDOOXUJLFDO DQG VXUIDFH SURSHUWLHV RI FDUERQ VWHHO WKH FRQ WHULVWLFV DV ZHOO DV WKH PHWDOOXUJLFDO DQG VXUIDFH SURSHUWLHV RI FDUERQ VWHHO WKH FRQ
FUHWH VWHHO V\VWHP UHSUHVHQWV D FRPSOH[ FKHPLFDOHOHFWURFKHPLFDO V\VWHP 7KH GH FUHWH VWHHO V\VWHP UHSUHVHQWV D FRPSOH[ FKHPLFDOHOHFWURFKHPLFDO V\VWHP 7KH GH
VFULSWLRQ RI FRUURVLRQ SURFHVVHV LQ VXFK D FRPSOH[ V\VWHP DV ZHOO DV WKH HYDOXDWLRQ VFULSWLRQ RI FRUURVLRQ SURFHVVHV LQ VXFK D FRPSOH[ V\VWHP DV ZHOO DV WKH HYDOXDWLRQ
DQG WKH GHVLJQ RI VROXWLRQV IRU FRUURVLRQ SURWHFWLRQ LH FRXQWHUPHDVXUHV UHTXLUH D DQG WKH GHVLJQ RI VROXWLRQV IRU FRUURVLRQ SURWHFWLRQ LH FRXQWHUPHDVXUHV UHTXLUH D
SURIRXQGNQRZOHGJHRQDOOGHFLVLYHSDUDPHWHUVFRQFHUQLQJWKHFRQFUHWHDQGWKHVWHHO SURIRXQGNQRZOHGJHRQDOOGHFLVLYHSDUDPHWHUVFRQFHUQLQJWKHFRQFUHWHDQGWKHVWHHO
DORQHDVZHOODVRQWKHLQWHUDFWLRQEHWZHHQWKHWZRPDWHULDOVIURPDSK\VLFDOFKHPL DORQHDVZHOODVRQWKHLQWHUDFWLRQEHWZHHQWKHWZRPDWHULDOVIURPDSK\VLFDOFKHPL
FDODQGHOHFWURFKHPLFDOSRLQWRIYLHZ)XUWKHUPRUHGHWDLOHGNQRZOHGJHRQWKHPDQL FDODQGHOHFWURFKHPLFDOSRLQWRIYLHZ)XUWKHUPRUHGHWDLOHGNQRZOHGJHRQWKHPDQL
IROGSDUDPHWHUVFRQFHUQLQJWKHDSSOLFDWLRQRIWKHUHLQIRUFHGFRQFUHWHPHPEHU LQSDU IROGSDUDPHWHUVFRQFHUQLQJWKHDSSOLFDWLRQRIWKHUHLQIRUFHGFRQFUHWHPHPEHU LQSDU
WLFXODUZLWKUHJDUGWRVWUXFWXUDODQGH[SRVXUHFRQGLWLRQV LVHVVHQWLDO WLFXODUZLWKUHJDUGWRVWUXFWXUDODQGH[SRVXUHFRQGLWLRQV LVHVVHQWLDO
7KLV 6HFWLRQ VXPPDULVHV WKH DERYH PHQWLRQHG DVSHFWV ZKLOH IRFXVVLQJ RQ WKH PRVW 7KLV 6HFWLRQ VXPPDULVHV WKH DERYH PHQWLRQHG DVSHFWV ZKLOH IRFXVVLQJ RQ WKH PRVW
LPSRUWDQWSDUDPHWHUVWKDWDUHRIUHOHYDQFHIRUWKHSXUSRVHRIWKLVWKHVLV$EULHIGH LPSRUWDQWSDUDPHWHUVWKDWDUHRIUHOHYDQFHIRUWKHSXUSRVHRIWKLVWKHVLV$EULHIGH
VFULSWLRQ RI VHOHFWHG SURSHUWLHV RI 3RUWODQG FHPHQW FRQFUHWH DQG FDUERQ VWHHO UHLQ VFULSWLRQ RI VHOHFWHG SURSHUWLHV RI 3RUWODQG FHPHQW FRQFUHWH DQG FDUERQ VWHHO UHLQ
IRUFHPHQWLVJLYHQZKLFKLVOLPLWHGWRWKHHVVHQWLDOLQIRUPDWLRQFRQFHUQLQJSURSHUWLHV IRUFHPHQWLVJLYHQZKLFKLVOLPLWHGWRWKHHVVHQWLDOLQIRUPDWLRQFRQFHUQLQJSURSHUWLHV
LQ UHODWLRQ WR FRUURVLRQ &RQFHUQLQJ FRQFUHWH HPSKDVLV LV RQ WKH FRQFUHWH SRURVLW\ LQ UHODWLRQ WR FRUURVLRQ &RQFHUQLQJ FRQFUHWH HPSKDVLV LV RQ WKH FRQFUHWH SRURVLW\
DQGWKHDVVRFLDWHGWUDQVSRUWSURSHUWLHVDVZHOODVWKHFRPSRVLWLRQRIWKHSRUHVROXWLRQ DQGWKHDVVRFLDWHGWUDQVSRUWSURSHUWLHVDVZHOODVWKHFRPSRVLWLRQRIWKHSRUHVROXWLRQ
6HFWLRQ &RQFHUQLQJFDUERQVWHHOUHLQIRUFHPHQWHPSKDVLVLVVHWRQWKHPHWDOOXU 6HFWLRQ &RQFHUQLQJFDUERQVWHHOUHLQIRUFHPHQWHPSKDVLVLVVHWRQWKHPHWDOOXU
JLFDODQGVXUIDFHSURSHUWLHV 6HFWLRQ 7KHLQIOXHQFHRIERWKWKHFRQFUHWHDQGWKH JLFDODQGVXUIDFHSURSHUWLHV 6HFWLRQ 7KHLQIOXHQFHRIERWKWKHFRQFUHWHDQGWKH
FDUERQVWHHOSURSHUWLHVRQWKHFRQFUHWHVWHHOLQWHUIDFHLVGHDOWZLWKLQWKHVHSDUDWH6HF FDUERQVWHHOSURSHUWLHVRQWKHFRQFUHWHVWHHOLQWHUIDFHLVGHDOWZLWKLQWKHVHSDUDWH6HF
WLRQ WLRQ

 3RUWODQG&HPHQW&RQFUHWH  3RUWODQG&HPHQW&RQFUHWH


&RQFUHWH LV D FRPSRVLWH PDWHULDO FRPSRVHG RI JUDQXODU PDWHULDO LH WKH DJJUHJDWH &RQFUHWH LV D FRPSRVLWH PDWHULDO FRPSRVHG RI JUDQXODU PDWHULDO LH WKH DJJUHJDWH
HPEHGGHGLQDPRUHRUOHVVGHQVHPDWUL[RIFHPHQWSDVWHWKDWILOOVWKHVSDFHEHWZHHQ HPEHGGHGLQDPRUHRUOHVVGHQVHPDWUL[RIFHPHQWSDVWHWKDWILOOVWKHVSDFHEHWZHHQ
WKHDJJUHJDWHSDUWLFOHVDQGJOXHVWKHPWRJHWKHU7KHFHPHQWSDVWHFRQVLVWVRIWKHUHDF WKHDJJUHJDWHSDUWLFOHVDQGJOXHVWKHPWRJHWKHU7KHFHPHQWSDVWHFRQVLVWVRIWKHUHDF
WLRQSURGXFWVDQGSRVVLEOHUHPDLQVRIWKHUHDFWDQWVFHPHQWDQGPL[LQJZDWHU WLRQSURGXFWVDQGSRVVLEOHUHPDLQVRIWKHUHDFWDQWVFHPHQWDQGPL[LQJZDWHU
$JJUHJDWHVFDQEHREWDLQHGIURPGLIIHUHQWNLQGVRIPDWHULDOVEXWSUHGRPLQDQWO\QDWX $JJUHJDWHVFDQEHREWDLQHGIURPGLIIHUHQWNLQGVRIPDWHULDOVEXWSUHGRPLQDQWO\QDWX
UDO PDWHULDOV LH VDQG DQG JUDYHO DUH XVHG 6DQG DQG JUDYHODUH JHQHUDOO\ LQHUW DQG UDO PDWHULDOV LH VDQG DQG JUDYHO DUH XVHG 6DQG DQG JUDYHODUH JHQHUDOO\ LQHUW DQG
QRQSRURXVEXWRIWHQFRQWDLQORZFRQFHQWUDWLRQVRIFKORULGHV&RQFUHWHGHWHULRUDWLRQ QRQSRURXVEXWRIWHQFRQWDLQORZFRQFHQWUDWLRQVRIFKORULGHV&RQFUHWHGHWHULRUDWLRQ
E\µ$65¶ FI6HFWLRQ FDQEHRIFRQFHUQLIFHUWDLQUHDFWLYHDJJUHJDWHVFRQWDLQLQJ E\µ$65¶ FI6HFWLRQ FDQEHRIFRQFHUQLIFHUWDLQUHDFWLYHDJJUHJDWHVFRQWDLQLQJ
DPRUSKRXVVLOLFDDUHXVHG3RWDEOHZDWHUZLWKYDU\LQJFRPSRVLWLRQVGHSHQGLQJRQWKH DPRUSKRXVVLOLFDDUHXVHG3RWDEOHZDWHUZLWKYDU\LQJFRPSRVLWLRQVGHSHQGLQJRQWKH
ORFDOSURSHUWLHVLVJHQHUDOO\XVHGDVPL[LQJZDWHU ORFDOSURSHUWLHVLVJHQHUDOO\XVHGDVPL[LQJZDWHU
&HPHQWVDUHILQHPLQHUDOSRZGHUVWKDWZKHQPL[HGZLWKZDWHUIRUPDSDVWHWKDWVHWV &HPHQWVDUHILQHPLQHUDOSRZGHUVWKDWZKHQPL[HGZLWKZDWHUIRUPDSDVWHWKDWVHWV
DQGKDUGHQVGXHWRK\GUDWLRQUHDFWLRQV&HPHQWLVDJHQHULFWHUPDQGFDQDSSO\WRGLI DQGKDUGHQVGXHWRK\GUDWLRQUHDFWLRQV&HPHQWLVDJHQHULFWHUPDQGFDQDSSO\WRGLI

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH

IHUHQWFODVVHVRIELQGHUV7KHSUHVHQWWKHVLVLVIRFXVHGRQ3RUWODQGFHPHQW FRQFUHWH IHUHQWFODVVHVRIELQGHUV7KHSUHVHQWWKHVLVLVIRFXVHGRQ3RUWODQGFHPHQW FRQFUHWH


ZKLFKLVXVHGIRUPRVWFLYLOHQJLQHHULQJVWUXFWXUHV>0LQGHVVHWDO@+RZHYHU ZKLFKLVXVHGIRUPRVWFLYLOHQJLQHHULQJVWUXFWXUHV>0LQGHVVHWDO@+RZHYHU
PLQHUDODGGLWLRQVDQG FKHPLFDODGPL[WXUHVWRREWDLQVSHFLILFFRQFUHWHSURSHUWLHVDUH PLQHUDODGGLWLRQVDQG FKHPLFDODGPL[WXUHVWRREWDLQVSHFLILFFRQFUHWHSURSHUWLHVDUH
EULHIO\GHDOWZLWKLQ6HFWLRQ EULHIO\GHDOWZLWKLQ6HFWLRQ
7KHIROORZLQJWHUPVDUHXVHGWRGLVWLQJXLVKEHWZHHQ3RUWODQGFHPHQWEDVHGFRPSRVL 7KHIROORZLQJWHUPVDUHXVHGWRGLVWLQJXLVKEHWZHHQ3RUWODQGFHPHQWEDVHGFRPSRVL
WLRQVZLWKUHJDUGWRWKHLUDJJUHJDWHFRQWHQW WLRQVZLWKUHJDUGWRWKHLUDJJUHJDWHFRQWHQW
‡ &RQFUHWH$FRPSRVLWHPDWHULDORIILQHDQGFRDUVHDJJUHJDWHVLHVDQG JUDLQVL]H ‡ &RQFUHWH$FRPSRVLWHPDWHULDORIILQHDQGFRDUVHDJJUHJDWHVLHVDQG JUDLQVL]H
”PP DQGJUDYHO JUDLQVL]H!PP 3RUWODQGFHPHQWDQGZDWHU ”PP DQGJUDYHO JUDLQVL]H!PP 3RUWODQGFHPHQWDQGZDWHU
‡ 0RUWDU $ FRPSRVLWH PDWHULDO RI ILQH DJJUHJDWHV LH VDQG JUDLQ VL]H ” PP  ‡ 0RUWDU $ FRPSRVLWH PDWHULDO RI ILQH DJJUHJDWHV LH VDQG JUDLQ VL]H ” PP 
3RUWODQGFHPHQWDQGZDWHU 3RUWODQGFHPHQWDQGZDWHU
‡ &HPHQWSDVWH$FRPSRVLWHPDWHULDORI3RUWODQGFHPHQWDQGZDWHU ‡ &HPHQWSDVWH$FRPSRVLWHPDWHULDORI3RUWODQGFHPHQWDQGZDWHU
7KH PRVW LPSRUWDQW (XURSHDQ VWDQGDUGV FRQFHUQLQJ WKH VSHFLILFDWLRQ SHUIRUPDQFH 7KH PRVW LPSRUWDQW (XURSHDQ VWDQGDUGV FRQFHUQLQJ WKH VSHFLILFDWLRQ SHUIRUPDQFH
DQG SURGXFWLRQ RI VWUXFWXUDO FRQFUHWH DUH >'6(1  @ ZKLFK LV FRPSOH DQG SURGXFWLRQ RI VWUXFWXUDO FRQFUHWH DUH >'6(1  @ ZKLFK LV FRPSOH
PHQWHGE\DGGLWLRQDOQDWLRQDOUXOHV HJ>'6@IRU'HQPDUN DQGEHVLGHV PHQWHGE\DGGLWLRQDOQDWLRQDOUXOHV HJ>'6@IRU'HQPDUN DQGEHVLGHV
WKH FHPHQW VSHFLILFDWLRQV FI 6HFWLRQ   VXSSOHPHQWHG E\ WKH VWDQGDUGV IRU DJ WKH FHPHQW VSHFLILFDWLRQV FI 6HFWLRQ   VXSSOHPHQWHG E\ WKH VWDQGDUGV IRU DJ
JUHJDWHVIRUFRQFUHWH>'6(1@DQG PL[LQJZDWHU>'6(1@ JUHJDWHVIRUFRQFUHWH>'6(1@DQG PL[LQJZDWHU>'6(1@
7KHFRUUHVSRQGLQJ86HTXLYDOHQWVDUHWKHVWDQGDUGVSHFLILFDWLRQV IRU VWUXFWXUDO FRQ 7KHFRUUHVSRQGLQJ86HTXLYDOHQWVDUHWKHVWDQGDUGVSHFLILFDWLRQV IRU VWUXFWXUDO FRQ
FUHWH>$&,0@FRQFUHWHDJJUHJDWHV>$670&@DQGPL[LQJZDWHU FUHWH>$&,0@FRQFUHWHDJJUHJDWHV>$670&@DQGPL[LQJZDWHU
>$670&0@ >$670&0@

 3RUWODQG&HPHQW  3RUWODQG&HPHQW


,QVLPSOHWHUPV3RUWODQGFHPHQWLVSURGXFHGE\JULQGLQJFOLQNHUZKLFKLVREWDLQHG ,QVLPSOHWHUPV3RUWODQGFHPHQWLVSURGXFHGE\JULQGLQJFOLQNHUZKLFKLVREWDLQHG
E\ EXUQLQJ D VXLWDEOH PL[WXUH RI OLPHVWRQH FOD\ DQG RWKHU VXLWDEOH PDWHULDOV 7KH E\ EXUQLQJ D VXLWDEOH PL[WXUH RI OLPHVWRQH FOD\ DQG RWKHU VXLWDEOH PDWHULDOV 7KH
EXUQLQJWDNHVSODFHLQDNLOQDWƒ&WRƒ&ZKLFKLVWKHWHPSHUDWXUHUDQJHLQ EXUQLQJWDNHVSODFHLQDNLOQDWƒ&WRƒ&ZKLFKLVWKHWHPSHUDWXUHUDQJHLQ
ZKLFKWKHWZRPDWHULDOVLQWHUDFWFKHPLFDOO\>0LQGHVVHWDO@ ZKLFKWKHWZRPDWHULDOVLQWHUDFWFKHPLFDOO\>0LQGHVVHWDO@
7KHPDLQFRPSRQHQWVRI3RUWODQGFHPHQWDUHWULFDOFLXPVLOLFDWH &D2Â6L2 GLFDO 7KHPDLQFRPSRQHQWVRI3RUWODQGFHPHQWDUHWULFDOFLXPVLOLFDWH &D2Â6L2 GLFDO
FLXPVLOLFDWH &D2Â6L2 WULFDOFLXPDOXPLQDWH &D2Â$O2 DQGWHWUDFDOFLXPIHU FLXPVLOLFDWH &D2Â6L2 WULFDOFLXPDOXPLQDWH &D2Â$O2 DQGWHWUDFDOFLXPIHU
URDOXPLQDWH &D2Â$O2Â)H2 *\SVXP &D62Â+2 LVDGGHGWRWKHFOLQNHUEH URDOXPLQDWH &D2Â$O2Â)H2 *\SVXP &D62Â+2 LVDGGHGWRWKHFOLQNHUEH
IRUH RU GXULQJ JULQGLQJ WR FRQWURO WKH UDWH RI K\GUDWLRQ RI WKH DOXPLQDWHV >1HYLOOH IRUH RU GXULQJ JULQGLQJ WR FRQWURO WKH UDWH RI K\GUDWLRQ RI WKH DOXPLQDWHV >1HYLOOH
@ @
3RUWODQG FHPHQWV DUH VSHFLILHG LQ >'6(1   $670 & @ 7KH 3RUWODQG FHPHQWV DUH VSHFLILHG LQ >'6(1   $670 & @ 7KH
FKHPLFDO DQDO\VLV LQ 7DEOH  SUHVHQWV D W\SLFDO FHPHQW FRPSRVLWLRQ RI UDSLG 3RUW FKHPLFDO DQDO\VLV LQ 7DEOH  SUHVHQWV D W\SLFDO FHPHQW FRPSRVLWLRQ RI UDSLG 3RUW
ODQGFHPHQW7\SH ,>'6(1$670&@ZKLFKLVWKHFHPHQW ODQGFHPHQW7\SH ,>'6(1$670&@ZKLFKLVWKHFHPHQW
WKDWZDVXVHGLQWKHH[SHULPHQWDOLQYHVWLJDWLRQVRIWKLVSURMHFW WKDWZDVXVHGLQWKHH[SHULPHQWDOLQYHVWLJDWLRQVRIWKLVSURMHFW

 

3RUWODQGFHPHQWUHIHUVWRDIDPLO\RIFDOFLXPVLOLFDWHFHPHQWV7KHSUHIL[³3RUWODQG´ZDVFRLQHGE\ 3RUWODQGFHPHQWUHIHUVWRDIDPLO\RIFDOFLXPVLOLFDWHFHPHQWV7KHSUHIL[³3RUWODQG´ZDVFRLQHGE\
-RVHSK$VSGLQ 8. EHFDXVHRIWKHUHDORUIDQFLHGVLPLODULW\RIWKHKDUGHQHGFHPHQWWRD -RVHSK$VSGLQ 8. EHFDXVHRIWKHUHDORUIDQFLHGVLPLODULW\RIWKHKDUGHQHGFHPHQWWRD
SRSXODUQDWXUDOO\RFFXUULQJOLPHVWRQHTXDUULHGDWWKH,VOHRI3RUWODQG8.ZKLFKZDVXVHGLQPDQ\ SRSXODUQDWXUDOO\RFFXUULQJOLPHVWRQHTXDUULHGDWWKH,VOHRI3RUWODQG8.ZKLFKZDVXVHGLQPDQ\
WKDQGWKFHQWXU\EXLOGLQJVLQVRXWKHUQ(QJODQG>0LQGHVVHWDO:LNLPHGLD@ WKDQGWKFHQWXU\EXLOGLQJVLQVRXWKHUQ(QJODQG>0LQGHVVHWDO:LNLPHGLD@

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO

7DEOH &KHPLFDO DQDO\VLV RI UDSLG KDUGHQLQJ 3RUWODQG FHPHQW &(0 ,  7DEOH &KHPLFDO DQDO\VLV RI UDSLG KDUGHQLQJ 3RUWODQG FHPHQW &(0 , 
)URP $3 7KLVFHPHQWW\SHZDVXVHGDVWKHVWDQGDUGFHPHQWLQ )URP $3 7KLVFHPHQWW\SHZDVXVHGDVWKHVWDQGDUGFHPHQWLQ
DOOH[SHULPHQWDOLQYHVWLJDWLRQV FI6HFWLRQ  DOOH[SHULPHQWDOLQYHVWLJDWLRQV FI6HFWLRQ 

&RPSRQHQW 8QLW $PRXQW &RPSRQHQW 8QLW $PRXQW &RPSRQHQW 8QLW $PRXQW &RPSRQHQW 8QLW $PRXQW

6L2   $V PJNJ   6L2   $V PJNJ  
$O2   &R PJNJ   $O2   &R PJNJ  
)H2   &G PJNJ   )H2   &G PJNJ  

&D2   6E PJNJ   &D2   6E PJNJ  
32   &X PJNJ  32   &X PJNJ 

0J2   3E PJNJ   0J2   3E PJNJ  
62   =Q PJNJ  62   =Q PJNJ 
&O   9 PJNJ  &O   9 PJNJ 
.2   &U PJNJ  .2   &U PJNJ 
1D2   0Q PJNJ  1D2   0Q PJNJ 
,JQLWLRQORVV   1L PJNJ  ,JQLWLRQORVV   1L PJNJ 
 


 7KHYDOXHLVEHORZGHWHFWLRQOLPLW  7KHYDOXHLVEHORZGHWHFWLRQOLPLW

 +\GUDWLRQ  +\GUDWLRQ


'XULQJ K\GUDWLRQ WKH JURVV YROXPH RI WKH FHPHQW SDVWH FI 6HFWLRQ   UHPDLQV 'XULQJ K\GUDWLRQ WKH JURVV YROXPH RI WKH FHPHQW SDVWH FI 6HFWLRQ   UHPDLQV
SUDFWLFDOO\ XQFKDQJHG DQG WKH LQLWLDO YROXPH ZKLFK FRUUHVSRQGV WR WKH VXP RI WKH SUDFWLFDOO\ XQFKDQJHG DQG WKH LQLWLDO YROXPH ZKLFK FRUUHVSRQGV WR WKH VXP RI WKH
YROXPHVRIWKHPL[LQJZDWHUDQGWKHFHPHQWLVHTXDOWRWKHYROXPHRIWKHKDUGHQHG YROXPHVRIWKHPL[LQJZDWHUDQGWKHFHPHQWLVHTXDOWRWKHYROXPHRIWKHKDUGHQHG
FHPHQWSDVWH7KHKDUGHQHGFHPHQWSDVWHFRQVLVWVRIWKHVXPRIWKHYROXPHRIFHPHQW FHPHQWSDVWH7KHKDUGHQHGFHPHQWSDVWHFRQVLVWVRIWKHVXPRIWKHYROXPHRIFHPHQW
WKDWKDVQRW\HWUHDFWHGWKHK\GUDWHGFHPHQWDQGWKHFDSLOODU\SRUHVWKDWDUHILOOHGE\ WKDWKDVQRW\HWUHDFWHGWKHK\GUDWHGFHPHQWDQGWKHFDSLOODU\SRUHVWKDWDUHILOOHGE\
ZDWHU RU E\ DLU 7KH YROXPH RI WKH SURGXFWV RI K\GUDWLRQ FDQ EH DVVXPHG WR EH ZDWHU RU E\ DLU 7KH YROXPH RI WKH SURGXFWV RI K\GUDWLRQ FDQ EH DVVXPHG WR EH
URXJKO\GRXEOHWKDWRIWKHFHPHQW+HQFHWKHK\GUDWLRQSURGXFWVILOOWKHVSDFHSUHYL URXJKO\GRXEOHWKDWRIWKHFHPHQW+HQFHWKHK\GUDWLRQSURGXFWVILOOWKHVSDFHSUHYL
RXVO\RFFXSLHGE\WKHFHPHQWDQGSDUWRIWKHVXUURXQGLQJVSDFHLQLWLDOO\RFFXSLHGE\ RXVO\RFFXSLHGE\WKHFHPHQWDQGSDUWRIWKHVXUURXQGLQJVSDFHLQLWLDOO\RFFXSLHGE\
ZDWHU,IWKHFHPHQWSDVWHLVNHSWPRLVWGXULQJFXULQJWKHK\GUDWLRQSURFHHGVDQGWKH ZDWHU,IWKHFHPHQWSDVWHLVNHSWPRLVWGXULQJFXULQJWKHK\GUDWLRQSURFHHGVDQGWKH
FDSLOODU\SRUH YROXPH GHFUHDVHV DQGUHDFKHVD PLQLPXPZKHQWKHK\GUDWLRQRIWKH FDSLOODU\SRUHYROXPHGHFUHDVHV DQGUHDFKHVD PLQLPXPZKHQWKHK\GUDWLRQRIWKH
FHPHQWLVFRPSOHWHG>1HYLOOH%RXOIL]DHWDO@ FHPHQWLVFRPSOHWHG>1HYLOOH%RXOIL]DHWDO@
,Q FRQFOXVLRQ WKH YROXPH RI WKH FDSLOODU\ SRUHV LQ WKH FHPHQW SDVWH LQFUHDVHV ZLWK ,Q FRQFOXVLRQ WKH YROXPH RI WKH FDSLOODU\ SRUHV LQ WKH FHPHQW SDVWH LQFUHDVHV ZLWK
LQFUHDVLQJµZF¶DQGGHFUHDVHVZLWKLQFUHDVLQJGHJUHHRIK\GUDWLRQ ,QSULQFLSOHWKH LQFUHDVLQJµZF¶DQGGHFUHDVHVZLWKLQFUHDVLQJGHJUHHRIK\GUDWLRQ ,QSULQFLSOHWKH
HIIHFWRIK\GUDWLRQRQWKHGLIIXVLRQFRHIILFLHQWFDQEHFRQVLGHUHGWREHRILPSRUWDQFH HIIHFWRIK\GUDWLRQRQWKHGLIIXVLRQFRHIILFLHQWFDQEHFRQVLGHUHGWREHRILPSRUWDQFH
GXULQJWKHILUVWVL[PDWXULW\PRQWKDIWHUFDVWLQJ>1LHOVHQ@7KHUDWHRIFKHPLFDO GXULQJWKHILUVWVL[PDWXULW\PRQWKDIWHUFDVWLQJ>1LHOVHQ@7KHUDWHRIFKHPLFDO
UHDFWLRQV EHWZHHQ ZDWHU DQG FHPHQW LV DOVR GHSHQGHQW RQ WKH WHPSHUDWXUH $Q LQ UHDFWLRQV EHWZHHQ ZDWHU DQG FHPHQW LV DOVR GHSHQGHQW RQ WKH WHPSHUDWXUH $Q LQ
FUHDVHG WHPSHUDWXUH ZLOO DFFHOHUDWH WKH K\GUDWLRQ +RZHYHU LQFUHDVHG FXULQJ WHP FUHDVHG WHPSHUDWXUH ZLOO DFFHOHUDWH WKH K\GUDWLRQ +RZHYHU LQFUHDVHG FXULQJ WHP
SHUDWXUHFDQDOVROHDGWRDFRDUVHUDQGDQLQFUHDVHGSRURVLW\RIWKHKDUGHQHGFHPHQW SHUDWXUHFDQDOVROHDGWRDFRDUVHUDQGDQLQFUHDVHGSRURVLW\RIWKHKDUGHQHGFHPHQW
SDVWH SDVWH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH

 &HPHQW3DVWH  &HPHQW3DVWH


*LYHQWKDWGHQVHDQGLQHUWDJJUHJDWHVDUHXVHG WKHVWUXFWXUHDQGFRPSRVLWLRQRIWKH *LYHQWKDWGHQVHDQGLQHUWDJJUHJDWHVDUHXVHG WKHVWUXFWXUHDQGFRPSRVLWLRQRIWKH
FHPHQWSDVWHWRDODUJHH[WHQWGHWHUPLQHVWKHVWUHQJWKWKHGXUDELOLW\DQGDFFRUGLQJO\ FHPHQWSDVWHWRDODUJHH[WHQWGHWHUPLQHVWKHVWUHQJWKWKHGXUDELOLW\DQGDFFRUGLQJO\
WKHORQJWHUPSHUIRUPDQFHRIWKHFRQFUHWH WKHORQJWHUPSHUIRUPDQFHRIWKHFRQFUHWH
7KHGHYHORSPHQWRIVWUHQJWKLHWKHKDUGHQLQJRIFHPHQWSDVWHZKLFKIROORZVVROLGL 7KHGHYHORSPHQWRIVWUHQJWKLHWKHKDUGHQLQJRIFHPHQWSDVWHZKLFKIROORZVVROLGL
ILFDWLRQLVJRYHUQHGE\WKHK\GUDWLRQRIVLOLFDWHV7KHK\GUDWLRQRIWULFDOFLXPVLOLFDWHV ILFDWLRQLVJRYHUQHGE\WKHK\GUDWLRQRIVLOLFDWHV7KHK\GUDWLRQRIWULFDOFLXPVLOLFDWHV
DQGGLFDOFLXPVLOLFDWHVUHVXOWVLQFDOFLXPVLOLFDWHVK\GUDWHVIRUPLQJDULJLGJHOFRP DQGGLFDOFLXPVLOLFDWHVUHVXOWVLQFDOFLXPVLOLFDWHVK\GUDWHVIRUPLQJDULJLGJHOFRP
PRQO\ UHIHUUHG WR DV µ&6+¶ LH FDOFLXPVLOLFDWHK\GUDWH µ&6+¶ LV FRPSRVHG RI PRQO\ UHIHUUHG WR DV µ&6+¶ LH FDOFLXPVLOLFDWHK\GUDWH µ&6+¶ LV FRPSRVHG RI
H[WUHPHO\VPDOOSDUWLFOHVZLWKDOD\HUVWUXFWXUHWKDWDJJUHJDWHVLQIRUPDWLRQVRIDIHZ H[WUHPHO\VPDOOSDUWLFOHVZLWKDOD\HUVWUXFWXUHWKDWDJJUHJDWHVLQIRUPDWLRQVRIDIHZ
—PLQGLPHQVLRQFKDUDFWHULVHGE\LQWHUOD\HUVSDFHVRIVPDOOHUGLPHQVLRQV QP  —PLQGLPHQVLRQFKDUDFWHULVHGE\LQWHUOD\HUVSDFHVRIVPDOOHUGLPHQVLRQV QP 
DQG E\ D ODUJH VXUIDFH DUHD PJ  +\GUDWLRQ RI FDOFLXP VLOLFDWHV DOVR SUR DQG E\ D ODUJH VXUIDFH DUHD PJ  +\GUDWLRQ RI FDOFLXP VLOLFDWHV DOVR SUR
GXFHVKH[DJRQDOFU\VWDOVRI&D 2+ DOVRUHIHUUHGWRDVSRUWODQGLWH7KHFU\VWDOVDUH GXFHVKH[DJRQDOFU\VWDOVRI&D 2+ DOVRUHIHUUHGWRDVSRUWODQGLWH7KHFU\VWDOVDUH
LQWKHRUGHURIIHZ—PLQGLPHQVLRQDQGRFFXS\WRRIWKHYROXPHRIVROLGV LQWKHRUGHURIIHZ—PLQGLPHQVLRQDQGRFFXS\WRRIWKHYROXPHRIVROLGV
7KH\GRQRWFRQWULEXWHWRWKHVWUHQJWKRIWKHFHPHQWSDVWHH[FHSWWKDWWKH\ILOOVSDFH 7KH\GRQRWFRQWULEXWHWRWKHVWUHQJWKRIWKHFHPHQWSDVWHH[FHSWWKDWWKH\ILOOVSDFH
&D 2+  DV ZHOO DV 1D2+ DQG .2+ ZKLFK DUH SUHVHQW LQ VPDOO DPRXQWV DUH DOVR &D 2+  DV ZHOO DV 1D2+ DQG .2+ ZKLFK DUH SUHVHQW LQ VPDOO DPRXQWV DUH DOVR
LPSRUWDQWZLWKUHJDUGWRSURWHFWLQJWKHUHLQIRUFHPHQWEHFDXVHWKH\ODUJHO\GHWHUPLQH LPSRUWDQWZLWKUHJDUGWRSURWHFWLQJWKHUHLQIRUFHPHQWEHFDXVHWKH\ODUJHO\GHWHUPLQH
WKH FRPSRVLWLRQ RI WKHSRUH VROXWLRQ FI 6HFWLRQ   7KH K\GUDWLRQRIWULFDOFLXP WKH FRPSRVLWLRQ RI WKHSRUH VROXWLRQ FI 6HFWLRQ   7KH K\GUDWLRQRIWULFDOFLXP
DOXPLQDWH DQG WHWUDFDOFLXP IHUURDOXPLQDWH OHDGV DPRQJ RWKHUV WR K\GUDWHG FDOFLXP DOXPLQDWH DQG WHWUDFDOFLXP IHUURDOXPLQDWH OHDGV DPRQJ RWKHUV WR K\GUDWHG FDOFLXP
VXOSKRDOXPLQDWHV>1HYLOOH0LQGHVVHWDO%HUWROLQLHWDO@ VXOSKRDOXPLQDWHV>1HYLOOH0LQGHVVHWDO%HUWROLQLHWDO@

 3RURVLW\  3RURVLW\


$FUXFLDOSURSHUW\RIFRQFUHWHLVLWVSRURVLW\DVLWODUJHO\GHWHUPLQHVWKHVWUHQJWKDQG $FUXFLDOSURSHUW\RIFRQFUHWHLVLWVSRURVLW\DVLWODUJHO\GHWHUPLQHVWKHVWUHQJWKDQG
WUDQVSRUW SURSHUWLHV &RQVLGHULQJ WKH DJJUHJDWHV WR EH QRQSRURXV WKH FHPHQW SDVWH WUDQVSRUW SURSHUWLHV &RQVLGHULQJ WKH DJJUHJDWHV WR EH QRQSRURXV WKH FHPHQW SDVWH
GHWHUPLQHV WKH SRURVLW\ RI WKH FRQFUHWH 7KH K\GUDWHG FHPHQW SDVWH DOZD\V FRQWDLQV GHWHUPLQHV WKH SRURVLW\ RI WKH FRQFUHWH 7KH K\GUDWHG FHPHQW SDVWH DOZD\V FRQWDLQV
SRUHVRIGLYHUVHGLPHQVLRQV SRUHVRIGLYHUVHGLPHQVLRQV
7KHVWUXFWXUHRIµ&6+¶JHODQGWKHQRPHQFODWXUHRIWKHSRURVLW\LVVWLOODPDWWHURI 7KHVWUXFWXUHRIµ&6+¶JHODQGWKHQRPHQFODWXUHRIWKHSRURVLW\LVVWLOODPDWWHURI
GHEDWH $FFRUGLQJ WR >%HUWROLQL HWDO @ WKH LQWHUOD\HU VSDFLQJ EHWZHHQ µ&6+¶ GHEDWH $FFRUGLQJ WR >%HUWROLQL HWDO @ WKH LQWHUOD\HU VSDFLQJ EHWZHHQ µ&6+¶
VKHHWVWKHVRFDOOHG JHOSRUHVUDQJHVIURPIUDFWLRQVRIRQHQPWRVHYHUDOQPLQGL VKHHWVWKHVRFDOOHG JHOSRUHVUDQJHVIURPIUDFWLRQVRIRQHQPWRVHYHUDOQPLQGL
PHQVLRQVDQGREWDLQDYROXPHHTXDOWRDERXWRIWKHJHO7KHVPDOOHUJHOSRUHVGR PHQVLRQVDQGREWDLQDYROXPHHTXDOWRDERXWRIWKHJHO7KHVPDOOHUJHOSRUHVGR
QRWDIIHFWWKHGXUDELOLW\ RIWKHFRQFUHWHDQGLWVSURWHFWLYHIXQFWLRQIRUWKHUHLQIRUFH QRWDIIHFWWKHGXUDELOLW\ RIWKHFRQFUHWHDQGLWVSURWHFWLYHIXQFWLRQIRUWKHUHLQIRUFH
PHQWDVWKH\DUHWRRVPDOOWRDOORZVLJQLILFDQWWUDQVSRUWRIVSHFLHV FI6HFWLRQV PHQWDVWKH\DUHWRRVPDOOWRDOORZVLJQLILFDQWWUDQVSRUWRIVSHFLHV FI6HFWLRQV
DQG 7KHFDSLOODU\YRLGVDUHWKHSRUHVZKLFKDUHQRWILOOHGE\WKHVROLGK\GUD DQG 7KHFDSLOODU\YRLGVDUHWKHSRUHVZKLFKDUHQRWILOOHGE\WKHVROLGK\GUD
WLRQSURGXFWVLQWKHKDUGHQHGFHPHQWSDVWH7KH\KDYHGLPHQVLRQVRIWRQPLI WLRQSURGXFWVLQWKHKDUGHQHGFHPHQWSDVWH7KH\KDYHGLPHQVLRQVRIWRQPLI
WKHFHPHQWSDVWHLVZHOOK\GUDWHGDQGSURGXFHGXVLQJORZµZF¶UDWLRVEXWFDQUHDFK WKHFHPHQWSDVWHLVZHOOK\GUDWHGDQGSURGXFHGXVLQJORZµZF¶UDWLRVEXWFDQUHDFK
XSWR—PLIWKHFRQFUHWHLVEDVHGRQKLJKµZF¶UDWLRVRU LV QRW VXIILFLHQWO\ K\ XSWR—PLIWKHFRQFUHWHLVEDVHGRQKLJKµZF¶UDWLRVRU LV QRW VXIILFLHQWO\ K\
GUDWHG/DUJHUSRUHVRIGLPHQVLRQVRIXSWRVRPHPPDUHWKHUHVXOWRIDLUEXEEOHVDQG GUDWHG/DUJHUSRUHVRIGLPHQVLRQVRIXSWRVRPHPPDUHWKHUHVXOWRIDLUEXEEOHVDQG
YRLGVWKDWZHUHQRWUHPRYHGE\SURSHUFRPSDFWLRQRIWKHIUHVKFRQFUHWH$LUEXEEOHV YRLGVWKDWZHUHQRWUHPRYHGE\SURSHUFRPSDFWLRQRIWKHIUHVKFRQFUHWH$LUEXEEOHV
ZLWK GLDPHWHUV RI DERXW PP FDQ DOVR EH LQWHQWLRQDOO\ LQWURGXFHG LQ WKH FH ZLWK GLDPHWHUV RI DERXW PP FDQ DOVR EH LQWHQWLRQDOO\ LQWURGXFHG LQ WKH FH
PHQWSDVWHE\PHDQVRIDLUHQWUDLQLQJDGPL[WXUHVWRHQKDQFHWKHUHVLVWDQFHWRIUHH]H PHQWSDVWHE\PHDQVRIDLUHQWUDLQLQJDGPL[WXUHVWRHQKDQFHWKHUHVLVWDQFHWRIUHH]H
WKDZF\FOHV FI6HFWLRQ %RWKFDSLOODU\SRUHVDQGDLUYRLGVDUHUHOHYDQWWRWKHGX WKDZF\FOHV FI6HFWLRQ %RWKFDSLOODU\SRUHVDQGDLUYRLGVDUHUHOHYDQWWRWKHGX

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO

UDELOLW\ RI FRQFUHWH DQG LWV SURWHFWLRQ RI WKH UHLQIRUFHPHQW >1HYLOOH  0LQGHVV UDELOLW\ RI FRQFUHWH DQG LWV SURWHFWLRQ RI WKH UHLQIRUFHPHQW >1HYLOOH  0LQGHVV
HWDO%HUWROLQLHWDO@ HWDO%HUWROLQLHWDO@
1RWRQO\WKHSRUHDQGYRLGGLPHQVLRQVDUHRIFRQFHUQZKHQGHDOLQJZLWKWKHLQJUHVV 1RWRQO\WKHSRUHDQGYRLGGLPHQVLRQVDUHRIFRQFHUQZKHQGHDOLQJZLWKWKHLQJUHVV
SURSHUWLHVRIFRQFUHWHEXWDOVRWKHLUFRQQHFWLYLW\LHWKHSHUFRODWLRQFKDUDFWHULVWLFV SURSHUWLHVRIFRQFUHWHEXWDOVRWKHLUFRQQHFWLYLW\LHWKHSHUFRODWLRQFKDUDFWHULVWLFV
VLQFHLQJUHVVRIVSHFLHVWKDWSHQHWUDWHWKHFRQFUHWHIURPWKHRXWVLGHUHTXLUHVDQLQWHU VLQFHLQJUHVVRIVSHFLHVWKDWSHQHWUDWHWKHFRQFUHWHIURPWKHRXWVLGHUHTXLUHVDQLQWHU
FRQQHFWHGSDWK,QUHODWLRQWRWKDWWKHVRFDOOHGLQWHUIDFLDOWUDQVLWLRQ]RQHµ,7=¶LVRI FRQQHFWHGSDWK,QUHODWLRQWRWKDWWKHVRFDOOHGLQWHUIDFLDOWUDQVLWLRQ]RQHµ,7=¶LVRI
LPSRUWDQFH7KHµ,7=¶UHIHUVWRWKHYLFLQLW\RIWKHDJJUHJDWHV ZKHUHWKHSRURVLW\RI LPSRUWDQFH7KHµ,7=¶UHIHUVWRWKHYLFLQLW\RIWKHDJJUHJDWHV ZKHUHWKHSRURVLW\RI
WKHSDVWHLVKLJKHUWKDQLQWKHUHPDLQLQJSDVWH EXONSDVWH GXHWRUHVWULFWHGSDFNLQJRI WKHSDVWHLVKLJKHUWKDQLQWKHUHPDLQLQJSDVWH EXONSDVWH GXHWRUHVWULFWHGSDFNLQJRI
WKHRULJLQDOFHPHQWJUDLQV7KXVWKHµ,7=¶KDVDQLQFUHDVHGGLIIXVLYLW\ZKLFKDFFRUG WKHRULJLQDOFHPHQWJUDLQV7KXVWKHµ,7=¶KDVDQLQFUHDVHGGLIIXVLYLW\ZKLFKDFFRUG
LQJWR>-HQVHQ@FDQEHXSWRWLPHVKLJKHUWKDQWKHGLIIXVLYLW\LQWKHEXONFH LQJWR>-HQVHQ@FDQEHXSWRWLPHVKLJKHUWKDQWKHGLIIXVLYLW\LQWKHEXONFH
PHQWSDVWH PHQWSDVWH

 3RUH6ROXWLRQ  3RUH6ROXWLRQ


7KHFKHPLFDOFRPSRVLWLRQRIWKHSRUHVROXWLRQRIWKHK\GUDWHGFHPHQWSDVWHGHSHQGV 7KHFKHPLFDOFRPSRVLWLRQRIWKHSRUHVROXWLRQRIWKHK\GUDWHGFHPHQWSDVWHGHSHQGV
RQWKHFRPSRVLWLRQRIWKHFRQFUHWHPDLQO\RQWKHW\SHRIFHPHQWEXWDOVRRQWKHH[ RQWKHFRPSRVLWLRQRIWKHFRQFUHWHPDLQO\RQWKHW\SHRIFHPHQWEXWDOVRRQWKHH[
SRVXUHFRQGLWLRQV SRVXUHFRQGLWLRQV
$VVKRZQLQWKHILUVWWZRURZVRI7DEOHLQXQFDUERQDWHGDQGFKORULGHIUHH3RUW $VVKRZQLQWKHILUVWWZRURZVRI7DEOHLQXQFDUERQDWHGDQGFKORULGHIUHH3RUW
ODQGFHPHQWFRQFUHWHWKHSRUHVROXWLRQFRQVLVWVPDLQO\RIVRGLXPK\GUR[LGHDQGSR ODQGFHPHQWFRQFUHWHWKHSRUHVROXWLRQFRQVLVWVPDLQO\RIVRGLXPK\GUR[LGHDQGSR
WDVVLXPK\GUR[LGHZKLOH.2+LVSUHGRPLQDQW'HSHQGLQJRQWKHFRPSRVLWLRQRIWKH WDVVLXPK\GUR[LGHZKLOH.2+LVSUHGRPLQDQW'HSHQGLQJRQWKHFRPSRVLWLRQRIWKH
FHPHQWWKHS+RIWKHSRUHVROXWLRQLVLQWKHUDQJHRIZKLOHFRQFUHWHFRQWDLQLQJ FHPHQWWKHS+RIWKHSRUHVROXWLRQLVLQWKHUDQJHRIZKLOHFRQFUHWHFRQWDLQLQJ
SR]]RODQVFDQKDYHORZHUS+YDOXHV7KHFRQFHQWUDWLRQRIK\GUR[\OLRQVYDULHVIURP SR]]RODQVFDQKDYHORZHUS+YDOXHV7KHFRQFHQWUDWLRQRIK\GUR[\OLRQVYDULHVIURP
 PRO/ WR  PRO/ 2WKHU LRQV HJ FDOFLXP LRQV DQG VXOSKDWHLRQV 62í DUH  PRO/ WR  PRO/ 2WKHU LRQV HJ FDOFLXP LRQV DQG VXOSKDWH LRQV 62í DUH
DOVRSDUWRIWKHSRUHVROXWLRQEXWLQUDWKHUORZFRQFHQWUDWLRQV DOVRSDUWRIWKHSRUHVROXWLRQEXWLQUDWKHUORZFRQFHQWUDWLRQV
7DEOH ,RQLF FRQFHQWUDWLRQ PHDVXUHG LQ WKH SRUH VROXWLRQ H[WUDFWHG IURP FH 7DEOH ,RQLF FRQFHQWUDWLRQ PHDVXUHG LQ WKH SRUH VROXWLRQ H[WUDFWHG IURP FH
PHQW SDVWHV DQG PRUWDUV PDGH ZLWK 3RUWODQG FHPHQW $IWHU >%HUWROLQL PHQW SDVWHV DQG PRUWDUV PDGH ZLWK 3RUWODQG FHPHQW $IWHU >%HUWROLQL
HWDO @ &2 UHSUHVHQWV FDUERQDWLRQ DQG 1D&O VWDQGV IRU VRGLXP HWDO @ &2 UHSUHVHQWV FDUERQDWLRQ DQG 1D&O VWDQGV IRU VRGLXP
FKORULGHDGGHGWRWKHPL[ FKORULGHDGGHGWRWKHPL[

1D&O $JH 2+í 1D .  &D 62í &Oí 1D&O $JH 2+í 1D .  &D 62í &Oí
0L[ µZF¶ &2 0L[ µZF¶ &2
µZZFH¶ GD\V íPRO/ µZZFH¶ GD\V íPRO/
3DVWH  1R         3DVWH  1R        
0RUWDU  1R         0RUWDU  1R        
3DVWH  <HV         3DVWH  <HV        
3DVWH  1R         3DVWH  1R        
3DVWH  <HV         3DVWH  <HV        
 
 

,QVRPHOLWHUDWXUHWKHYLFLQLW\RIWKHUHLQIRUFHPHQWLVDOVRUHIHUUHGWRDVµ,7=¶+RZHYHUGXHWRWKH ,QVRPHOLWHUDWXUHWKHYLFLQLW\RIWKHUHLQIRUFHPHQWLVDOVRUHIHUUHGWRDVµ,7=¶+RZHYHUGXHWRWKH
LPSRUWDQFHRIWKLVUHJLRQZLWKUHJDUGWRUHLQIRUFHPHQWFRUURVLRQLWLVUHIHUUHGWRDVFRQFUHWHVWHHOLQ LPSRUWDQFHRIWKLVUHJLRQZLWKUHJDUGWRUHLQIRUFHPHQWFRUURVLRQLWLVUHIHUUHGWRDVFRQFUHWHVWHHOLQ
WHUIDFHWKURXJKRXWWKLVWKHVLVDQGKHQFHGLVWLQJXLVKHGIURPWKHµ,7=¶RIDJJUHJDWHV WHUIDFHWKURXJKRXWWKLVWKHVLVDQGKHQFHGLVWLQJXLVKHGIURPWKHµ,7=¶RIDJJUHJDWHV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH

5RZVWKUHHWRILYHVKRZWKDWWKHFRPSRVLWLRQRIWKHSRUHVROXWLRQLVODUJHO\DIIHFWHG 5RZVWKUHHWRILYHVKRZWKDWWKHFRPSRVLWLRQRIWKHSRUHVROXWLRQLVODUJHO\DIIHFWHG
E\FDUERQDWLRQDQGE\WKHSHQHWUDWLRQRIFKORULGHLRQVZKLFKLVGLVFXVVHGLQ6HFWLRQ E\FDUERQDWLRQDQGE\WKHSHQHWUDWLRQRIFKORULGHLRQVZKLFKLVGLVFXVVHGLQ6HFWLRQ
DQG6HFWLRQUHVSHFWLYHO\ DQG6HFWLRQUHVSHFWLYHO\

 7UDQVSRUW0HFKDQLVPV  7UDQVSRUW0HFKDQLVPV


7KHWUDQVSRUWRIJDVHVOLTXLGVDQGLRQVWKURXJKWKHFHPHQWSDVWHJHOLVJRYHUQHGE\D 7KHWUDQVSRUWRIJDVHVOLTXLGVDQGLRQVWKURXJKWKHFHPHQWSDVWHJHOLVJRYHUQHGE\D
YDULHW\RISK\VLFDODQGFKHPLFDOPHFKDQLVPV7KHWUDQVSRUWPHFKDQLVPVWKDWZHFRQ YDULHW\RISK\VLFDODQGFKHPLFDOPHFKDQLVPV7KHWUDQVSRUWPHFKDQLVPVWKDWZHFRQ
VLGHUWREHPRVWLPSRUWDQWZLWKUHJDUGWRUHLQIRUFHPHQWFRUURVLRQDUH VLGHUWREHPRVWLPSRUWDQWZLWKUHJDUGWRUHLQIRUFHPHQWFRUURVLRQDUH
‡ 'LIIXVLRQ FI6HFWLRQ  ‡ 'LIIXVLRQ FI6HFWLRQ 
‡ &DSLOODU\VXFWLRQ FI6HFWLRQ  ‡ &DSLOODU\VXFWLRQ FI6HFWLRQ 
‡ 0LJUDWLRQ FI6HFWLRQ  ‡ 0LJUDWLRQ FI6HFWLRQ 
‡ 3HUPHDWLRQLHWKHWUDQVSRUWRIOLTXLGVRUJDVHVFDXVHGE\DSUHVVXUHKHDG>.URSS ‡ 3HUPHDWLRQLHWKHWUDQVSRUWRIOLTXLGVRUJDVHVFDXVHGE\DSUHVVXUHKHDG>.URSS
+LOVGRUI@ +LOVGRUI@
‡ 7UDQVSRUWLQGXFHGE\VHFRQGDU\PHFKDQLVPVHJIUHH]HDQGWKDZF\FOHV>*HLNHU ‡ 7UDQVSRUWLQGXFHGE\VHFRQGDU\PHFKDQLVPVHJIUHH]HDQGWKDZF\FOHV>*HLNHU
7KDXORZ@ 7KDXORZ@
'LIIXVLRQFDSLOODU\VXFWLRQDQGPLJUDWLRQDUHUHOHYDQWIRUWKHSXUSRVHRIWKLVWKHVLV 'LIIXVLRQFDSLOODU\VXFWLRQDQGPLJUDWLRQDUHUHOHYDQWIRUWKHSXUSRVHRIWKLVWKHVLV
DQG WKH WKHRUHWLFDOEDFNJURXQG RI WKHVH PHFKDQLVPV LVEULHIO\GHVFULEHG LQ6HFWLRQV DQG WKH WKHRUHWLFDOEDFNJURXQG RI WKHVH PHFKDQLVPV LVEULHIO\GHVFULEHG LQ6HFWLRQV
DQGUHVSHFWLYHO\ DQGUHVSHFWLYHO\

 'LIIXVLRQ  'LIIXVLRQ


'LIIXVLRQ LQ FRQFUHWH FDQ EH GHILQHG DV WKH ³WUDQVIHU RI PDVV E\ UDQGRP PRWLRQ RI 'LIIXVLRQ LQ FRQFUHWH FDQ EH GHILQHG DV WKH ³WUDQVIHU RI PDVV E\ UDQGRP PRWLRQ RI
IUHHPROHFXOHVRULRQVLQWKHSRUHVROXWLRQUHVXOWLQJLQDIORZIURPUHJLRQVRIKLJKHU IUHHPROHFXOHVRULRQVLQWKHSRUHVROXWLRQUHVXOWLQJLQDIORZIURPUHJLRQVRIKLJKHU
FRQFHQWUDWLRQWRUHJLRQVRIORZHUFRQFHQWUDWLRQRIWKHGLIIXVLQJVXEVWDQFH´>.URSS  FRQFHQWUDWLRQWRUHJLRQVRIORZHUFRQFHQWUDWLRQRIWKHGLIIXVLQJVXEVWDQFH´>.URSS 
+LOVGRUI@ +LOVGRUI@
7RTXDQWLI\DQGSUHGLFWGLIIXVLRQLQFRQFUHWHPRGHOVEDVHGRQ)LFN¶VVHFRQGODZRI 7RTXDQWLI\DQGSUHGLFWGLIIXVLRQLQFRQFUHWHPRGHOVEDVHGRQ)LFN¶VVHFRQGODZRI
GLIIXVLRQDUHJHQHUDOO\XVHG)LFN¶VVHFRQGODZRIGLIIXVLRQLVIRUPXODWHGDV GLIIXVLRQDUHJHQHUDOO\XVHG)LFN¶VVHFRQGODZRIGLIIXVLRQLVIRUPXODWHGDV

∂& ∂ § ∂& · ∂& ∂ § ∂& ·


= ¨'× ¸ >@ = ¨'× ¸ >@
∂W ∂[ © ∂W ¹ ∂W ∂[ © ∂W ¹

ZLWKµ&¶DVWKHFRQFHQWUDWLRQRIWKHGLIIXVLQJVXEVWDQFHDQGµ'¶DVWKHDVVRFLDWHGGLI ZLWKµ&¶DVWKHFRQFHQWUDWLRQRIWKHGLIIXVLQJVXEVWDQFHDQGµ'¶DVWKHDVVRFLDWHGGLI
IXVLRQFRHIILFLHQW IXVLRQFRHIILFLHQW
)RUDQLQILQLWHVRXUFHRIDGLIIXVLQJVXEVWDQFHWKHFRPPRQHUURUIXQFWLRQVROXWLRQWR )RUDQLQILQLWHVRXUFHRIDGLIIXVLQJVXEVWDQFHWKHFRPPRQHUURUIXQFWLRQVROXWLRQWR
)LFN¶VVHFRQGODZRIGLIIXVLRQVROYHVWKHSDUWLDOGLIIHUHQWLDOHTXDWLRQDVVXPLQJFRQ )LFN¶VVHFRQGODZRIGLIIXVLRQVROYHVWKHSDUWLDOGLIIHUHQWLDOHTXDWLRQDVVXPLQJFRQ
VWDQWµ'¶DQGVXUIDFHFRQFHQWUDWLRQ µ&V¶  VWDQWµ'¶DQGVXUIDFHFRQFHQWUDWLRQ µ&V¶ 

§ [ · § [ ·
& ( [ W ) = &V − ( &V − &L ) × HUI ¨ & ( [ W ) = &V − ( &V − &L ) × HUI ¨
¨  × ' × W ¸¸ ¨  × ' × W ¸¸
 >@  >@
© ¹ © ¹

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO

7KLVPHDQVWKDWWKHWRWDOFRQFHQWUDWLRQµ&¶RIDGLIIXVLQJVXEVWDQFHDWDFHUWDLQGHSWK 7KLVPHDQVWKDWWKHWRWDOFRQFHQWUDWLRQµ&¶RIDGLIIXVLQJVXEVWDQFHDWDFHUWDLQGHSWK
µ[¶DQGWLPHµW¶FDQEHGHWHUPLQHGEDVHGRQWKHWRWDOFRQFHQWUDWLRQDWWKHH[SRVHGVXU µ[¶DQGWLPHµW¶FDQEHGHWHUPLQHGEDVHGRQWKHWRWDOFRQFHQWUDWLRQDWWKHH[SRVHGVXU
IDFH µ&V¶ DQGWKHLQLWLDOFRQFHQWUDWLRQLQWKHPDWHULDO µ&L¶ 7KHHUURUIXQFWLRQ µHUI¶  IDFH µ&V¶ DQGWKHLQLWLDOFRQFHQWUDWLRQLQWKHPDWHULDO µ&L¶ 7KHHUURUIXQFWLRQ µHUI¶ 
LQWKHOLWHUDWXUHDOVRUHIHUUHGWRDV*DXVVHUURUIXQFWLRQ LVGHVFULEHGDV LQWKHOLWHUDWXUHDOVRUHIHUUHGWRDV*DXVVHUURUIXQFWLRQ LVGHVFULEHGDV
] ]
 
HUI ( ] ) = × ³ H[S ( −X  ) GX  >@ HUI ( ] ) = × ³ H[S ( −X  ) GX  >@
π  π 

 &DSLOODU\6XFWLRQ  &DSLOODU\6XFWLRQ


&DSLOODU\VXFWLRQ LQWKHOLWHUDWXUHDOVRUHIHUUHGWRDVVRUSWLRQ FDQEHGHILQHGDVWKH &DSLOODU\VXFWLRQ LQWKHOLWHUDWXUHDOVRUHIHUUHGWRDVVRUSWLRQ FDQEHGHILQHGDVWKH
³WUDQVSRUW RI OLTXLGV LQ SRURXV VROLGV GXH WR VXUIDFH WHQVLRQ DFWLQJ LQ FDSLOODULHV´ ³WUDQVSRUW RI OLTXLGV LQ SRURXV VROLGV GXH WR VXUIDFH WHQVLRQ DFWLQJ LQ FDSLOODULHV´
>9RONZHLQ@7KHH[WHQWRIFDSLOODU\VXFWLRQLVODUJHO\LQIOXHQFHGE\WKHGHJUHH >9RONZHLQ@7KHH[WHQWRIFDSLOODU\VXFWLRQLVODUJHO\LQIOXHQFHGE\WKHGHJUHH
RIVDWXUDWLRQ>1HYLOOH@0RUHRYHUFDSLOODU\VXFWLRQGHSHQGVRQWKHFKDUDFWHULV RIVDWXUDWLRQ>1HYLOOH@0RUHRYHUFDSLOODU\VXFWLRQGHSHQGVRQWKHFKDUDFWHULV
WLFVRIWKHOLTXLGHJYLVFRVLW\GHQVLW\DQGVXUIDFHWHQVLRQDVZHOODVRQWKHFKDUDF WLFVRIWKHOLTXLGHJYLVFRVLW\GHQVLW\DQGVXUIDFHWHQVLRQDVZHOODVRQWKHFKDUDF
WHULVWLFV RI WKH SRUH VWUXFWXUH LQ WKH PDWHULDO HJ WRUWXRVLW\ FRQWLQXLW\ DQG UDGLXV WHULVWLFV RI WKH SRUH VWUXFWXUH LQ WKH PDWHULDO HJ WRUWXRVLW\ FRQWLQXLW\ DQG UDGLXV
>.URSS  +LOVGRUI @ 8QGHU VWHDG\VWDWH IORZ FDSLOODU\ VXFWLRQ WKH IORZ RI D >.URSS  +LOVGRUI @ 8QGHU VWHDG\VWDWH IORZ FDSLOODU\ VXFWLRQ WKH IORZ RI D
OLTXLG µ)OLT¶ LQDSRUHV\VWHPFDQEHGHVFULEHGE\>.URSS +LOVGRUI@ OLTXLG µ)OLT¶ LQDSRUHV\VWHPFDQEHGHVFULEHGE\>.URSS +LOVGRUI@
NS ∂SSZ NS ∂SSZ
T = − ×  >@ T = − ×  >@
ηYLV ∂[ ηYLV ∂[

ZKHUH µNS¶ LVWKHFRHIILFLHQWRIPRLVWXUHSHUPHDELOLW\ µηYLV¶ LVWKHYLVFRVLW\RIWKH ZKHUH µNS¶ LVWKHFRHIILFLHQWRIPRLVWXUHSHUPHDELOLW\ µηYLV¶ LVWKHYLVFRVLW\RIWKH
OLTXLGDQG µSSZ¶ LVWKHSRUHZDWHUSUHVVXUH OLTXLGDQG µSSZ¶ LVWKHSRUHZDWHUSUHVVXUH
+RZHYHUGXHWRWKHPDQ\LUUHJXODULWLHVLQWKHSRUHV\VWHPWKHEHKDYLRXURIFRQFUHWH +RZHYHUGXHWRWKHPDQ\LUUHJXODULWLHVLQWKHSRUHV\VWHPWKHEHKDYLRXURIFRQFUHWH
GLYHUJHVODUJHO\IURPWKHWKHRU\DQGHPSLULFDOIRUPXODVDUHQRUPDOO\XVHGWRSUHGLFW GLYHUJHVODUJHO\IURPWKHWKHRU\DQGHPSLULFDOIRUPXODVDUHQRUPDOO\XVHGWRSUHGLFW
WKHHIIHFWRIFDSLOODU\VXFWLRQ WKHHIIHFWRIFDSLOODU\VXFWLRQ

 0LJUDWLRQ  0LJUDWLRQ


0LJUDWLRQFDQEHGHILQHGDVWKH ³WUDQVSRUWRILRQVLQHOHFWURO\WHVGXHWRWKHDFWLRQRI 0LJUDWLRQFDQEHGHILQHGDVWKH ³WUDQVSRUWRILRQVLQHOHFWURO\WHVGXHWRWKHDFWLRQRI
DQHOHFWULFDOILHOGDVWKHGULYLQJIRUFH´>.URSS +LOVGRUI@ DQHOHFWULFDOILHOGDVWKHGULYLQJIRUFH´>.URSS +LOVGRUI@
7KHYHORFLW\RIWKHLRQPRYHPHQWLVSURSRUWLRQDOWRWKHVWUHQJWKRIWKHHOHFWULFILHOG 7KHYHORFLW\RIWKHLRQPRYHPHQWLVSURSRUWLRQDOWRWKHVWUHQJWKRIWKHHOHFWULFILHOG
DQGWKHFKDUJHDQGVL]HRIWKHLRQ7KHLRQPRELOLW\ µXL¶ FDQEHGLUHFWO\UHODWHGWRWKH DQGWKHFKDUJHDQGVL]HRIWKHLRQ7KHLRQPRELOLW\ µXL¶ FDQEHGLUHFWO\UHODWHGWRWKH
GLIIXVLRQFRHIILFLHQWµ'¶>%HUWROLQLHWDO@ GLIIXVLRQFRHIILFLHQWµ'¶>%HUWROLQLHWDO@
5 × 7 × XL 5 × 7 × XL
' =  >@ ' =  >@
Q×) Q×)

7KHFRQWULEXWLRQRIDFHUWDLQLRQWRWKHLRQLFFXUUHQWWKURXJKDQHOHFWURO\WHLQFUHDVHV 7KHFRQWULEXWLRQRIDFHUWDLQLRQWRWKHLRQLFFXUUHQWWKURXJKDQHOHFWURO\WHLQFUHDVHV
ZLWKWKHFRQFHQWUDWLRQDQGWKHPRELOLW\RIWKHLRQ +\GURJHQDQGK\GUR[\OLRQVVKRZ ZLWKWKHFRQFHQWUDWLRQDQGWKHPRELOLW\RIWKHLRQ +\GURJHQDQGK\GUR[\OLRQVVKRZ
WKHKLJKHVWLRQPRELOLWLHVDQGWKHLUFRQGXFWLYLW\LVPXFKKLJKHUWKDQWKHRQHRIRWKHU WKHKLJKHVWLRQPRELOLWLHVDQGWKHLUFRQGXFWLYLW\LVPXFKKLJKHUWKDQWKHRQHRIRWKHU
LRQVGXHWRWKHLULQWHUDFWLRQZLWKWKHVROYHQWZDWHU>%HUWROLQLHWDO@7KHWUDQV LRQVGXHWRWKHLULQWHUDFWLRQZLWKWKHVROYHQWZDWHU>%HUWROLQLHWDO@7KHWUDQV
SRUWRIWKHVHLRQVGRHVQRWUHTXLUHWKHLUDFWXDOGLVSODFHPHQWEXWLVUDWKHUEDVHGRQD SRUWRIWKHVHLRQVGRHVQRWUHTXLUHWKHLUDFWXDOGLVSODFHPHQWEXWLVUDWKHUEDVHGRQD

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH

VHULHV RI EUHDNV DQG PRGLILFDWLRQV RI ERQGV ZLWKLQ WKH ZDWHU PROHFXOHV >%HUWROLQL VHULHV RI EUHDNV DQG PRGLILFDWLRQV RI ERQGV ZLWKLQ WKH ZDWHU PROHFXOHV >%HUWROLQL
HWDO@ HWDO@
&DWLRQVHJ+.1DDQG&DPLJUDWHWRZDUGVQHJDWLYHHOHFWURGHVLHFDWKRGLF &DWLRQVHJ+.1DDQG&DPLJUDWHWRZDUGVQHJDWLYHHOHFWURGHVLHFDWKRGLF
VLWHVZKHUHDVDQLRQVHJ 2+í62íDQG&OíDUH DWWUDFWHGE\SRVLWLYHHOHFWURGHV VLWHVZKHUHDVDQLRQVHJ 2+í62íDQG&OíDUH DWWUDFWHGE\SRVLWLYHHOHFWURGHV
LHDQRGLFVLWHV%DVHGRQWKLVFRQFHSWLRQLFFXUUHQW³IORZ´LQUHLQIRUFHPHQWFRUUR LHDQRGLFVLWHV%DVHGRQWKLVFRQFHSWLRQLFFXUUHQW³IORZ´LQUHLQIRUFHPHQWFRUUR
VLRQVKRXOGQRWEHDVVLJQHGDFHUWDLQ³GLUHFWLRQ´ DVGRQHLQPRVWWH[WERRNV $OOLRQV VLRQVKRXOGQRWEHDVVLJQHGDFHUWDLQ³GLUHFWLRQ´ DVGRQHLQPRVWWH[WERRNV $OOLRQV
SUHVHQWLQWKHFRQFUHWHEXONFDQGLVFKDUJHWKHFDWLRQVDQGDQLRQVIRUPHGDWWKHDQRGLF SUHVHQWLQWKHFRQFUHWHEXONFDQGLVFKDUJHWKHFDWLRQVDQGDQLRQVIRUPHGDWWKHDQRGLF
DQGFDWKRGLFVLWHVUHVSHFWLYHO\ DQGWKXVFRQWULEXWHLQSUHVHUYLQJWKHHOHFWULFDOQHX DQGFDWKRGLFVLWHVUHVSHFWLYHO\ DQGWKXVFRQWULEXWHLQSUHVHUYLQJWKHHOHFWULFDOQHX
WUDOLW\7KLVDOVRLVDFHQWUDODVSHFWLQWKHIRUPDWLRQRIPDFURFHOOV FI6HFWLRQ  WUDOLW\7KLVDOVRLVDFHQWUDODVSHFWLQWKHIRUPDWLRQRIPDFURFHOOV FI6HFWLRQ 
0RUHRYHUEDVHGRQWKHDERYHDQGZLWKUHJDUGWRWKHPRELOLWLHVRI+DQG2+íZH 0RUHRYHUEDVHGRQWKHDERYHDQGZLWKUHJDUGWRWKHPRELOLWLHVRI+DQG2+íZH
TXHVWLRQWKHFRPPRQQRWLRQLQWKHOLWHUDWXUHRQ UHLQIRUFHPHQW FRUURVLRQ FRQFHUQLQJ TXHVWLRQWKHFRPPRQQRWLRQLQWKHOLWHUDWXUHRQ UHLQIRUFHPHQW FRUURVLRQ FRQFHUQLQJ
WKHQDWXUHRILRQLFFXUUHQWLHWKDWWKHLRQLFFXUUHQWLVHVWDEOLVKHGE\PLJUDWLRQRIIHU WKHQDWXUHRILRQLFFXUUHQWLHWKDWWKHLRQLFFXUUHQWLVHVWDEOLVKHGE\PLJUDWLRQRIIHU
URXV LRQ WR FDWKRGLFVLWHVFRPELQLQJZLWKK\GUR[\OLRQVWRIRUPLURQK\GUR[LGH FI URXV LRQ WR FDWKRGLFVLWHVFRPELQLQJZLWKK\GUR[\OLRQVWRIRUPLURQK\GUR[LGH FI
6HFWLRQ 7KHVHFRQVLGHUDWLRQVSOD\DPDMRUUROHLQWKHSURSRVHGGHVFULSWLRQRI 6HFWLRQ 7KHVHFRQVLGHUDWLRQVSOD\DPDMRUUROHLQWKHSURSRVHGGHVFULSWLRQRI
FRUURVLRQSURFHVVHVRIVWHHOLQFRQFUHWH FI&KDSWHU  FRUURVLRQSURFHVVHVRIVWHHOLQFRQFUHWH FI&KDSWHU 

 ,QJUHVVDQG,RQ0RELOLW\  ,QJUHVVDQG,RQ0RELOLW\


$SDUWLFXODUIHDWXUHRIUHLQIRUFHGFRQFUHWHLVWKDWWKHFRQFUHWHEXONLWVHOISURYLGHVWKH $SDUWLFXODUIHDWXUHRIUHLQIRUFHGFRQFUHWHLVWKDWWKHFRQFUHWHEXONLWVHOISURYLGHVWKH
PHDQVWRODUJHO\LQIOXHQFHWKHUHDFWLRQNLQHWLFVDVZHOODVWKHWKHUPRG\QDPLFVWDWHRI PHDQVWRODUJHO\LQIOXHQFHWKHUHDFWLRQNLQHWLFVDVZHOODVWKHWKHUPRG\QDPLFVWDWHRI
WKHHPEHGGHGPHWDOOLFUHLQIRUFHPHQW2QWKHKDQGWKLVLQIOXHQFHVWKHFRUURVLRQSURF WKHHPEHGGHGPHWDOOLFUHLQIRUFHPHQW2QWKHKDQGWKLVLQIOXHQFHVWKHFRUURVLRQSURF
HVVHVLWVHOIRQWKHRWKHUKDQGWKLVDVSHFWSURYLGHVYDULRXVRSWLRQVIRUWKHLPSOHPHQ HVVHVLWVHOIRQWKHRWKHUKDQGWKLVDVSHFWSURYLGHVYDULRXVRSWLRQVIRUWKHLPSOHPHQ
WDWLRQRIFRXQWHUPHDVXUHVZKLFKDSSHDUWREHJHWWLQJPRUHDQGPRUHRXWRIVLJKWLQ WDWLRQRIFRXQWHUPHDVXUHVZKLFKDSSHDUWREHJHWWLQJPRUHDQGPRUHRXWRIVLJKWLQ
WKHSUHVHQWGD\FRXQWHUPHDVXUHDSSURDFKHV7KHVSHFLDOFKDUDFWHULVWLFVRIWKHFRQFUHWH WKHSUHVHQWGD\FRXQWHUPHDVXUHDSSURDFKHV7KHVSHFLDOFKDUDFWHULVWLFVRIWKHFRQFUHWH
EXONZLWKUHJDUGWRUHLQIRUFHPHQWFRUURVLRQDUHGHDOWZLWKLQWKLV6HFWLRQ EXONZLWKUHJDUGWRUHLQIRUFHPHQWFRUURVLRQDUHGHDOWZLWKLQWKLV6HFWLRQ
,Q6HFWLRQVWRWKHPRVWLPSRUWDQWSDUDPHWHUVGHWHUPLQLQJWKHLQJUHVVDQG ,Q6HFWLRQVWRWKHPRVWLPSRUWDQWSDUDPHWHUVGHWHUPLQLQJWKHLQJUHVVDQG
FRQGXFWLYLW\SURSHUWLHVRIFRQFUHWHKDYHEHHQLQWURGXFHG7KHLQIOXHQFHRIWKHVHSD FRQGXFWLYLW\SURSHUWLHVRIFRQFUHWHKDYHEHHQLQWURGXFHG7KHLQIOXHQFHRIWKHVHSD
UDPHWHUVRQWKHLQLWLDWLRQDQGSURSDJDWLRQRIUHLQIRUFHPHQWFRUURVLRQLVPDLQO\JRY UDPHWHUVRQWKHLQLWLDWLRQDQGSURSDJDWLRQRIUHLQIRUFHPHQWFRUURVLRQLVPDLQO\JRY
HUQHGE\WKHH[SRVXUHFRQGLWLRQVDQGWKHTXDOLW\DQGGHSWKRIWKHFRQFUHWHFRYHUEH HUQHGE\WKHH[SRVXUHFRQGLWLRQVDQGWKHTXDOLW\DQGGHSWKRIWKHFRQFUHWHFRYHUEH
FDXVH WKHVH IDFWRUV FRQWURO WKH SHQHWUDWLRQ RI R[\JHQ FDUERQ GLR[LGH DQG FKORULGH FDXVH WKHVH IDFWRUV FRQWURO WKH SHQHWUDWLRQ RI R[\JHQ FDUERQ GLR[LGH DQG FKORULGH
LRQVDVZHOODVWKHPRELOLW\RILRQVLHWKHFRQGXFWLYLW\+HQFHWKHUHVLVWDQFHRIWKH LRQVDVZHOODVWKHPRELOLW\RILRQVLHWKHFRQGXFWLYLW\+HQFHWKHUHVLVWDQFHRIWKH
FRQFUHWHFRYHUDJDLQVWSHQHWUDWLRQRIFDUERQGLR[LGHDQGFKORULGHLRQVODUJHO\GHWHU FRQFUHWHFRYHUDJDLQVWSHQHWUDWLRQRIFDUERQGLR[LGHDQGFKORULGHLRQVODUJHO\GHWHU
PLQHVWKHH[WHQWRIWKHLQLWLDWLRQSKDVH$VGHVFULEHGLQPRUHGHWDLOLQ&KDSWHUWKH PLQHVWKHH[WHQWRIWKHLQLWLDWLRQSKDVH$VGHVFULEHGLQPRUHGHWDLOLQ&KDSWHUWKH
SHQHWUDWLRQRIR[\JHQDQGWKHPRELOLW\RILRQVDOVRKDYHDPDMRUFRQWULEXWLRQLQWKH SHQHWUDWLRQRIR[\JHQDQGWKHPRELOLW\RILRQVDOVRKDYHDPDMRUFRQWULEXWLRQLQWKH
LQLWLDWLRQSKDVHDQGWKH\DUHWKHJRYHUQLQJIDFWRUVRQFHDFWLYHFRUURVLRQKDVEHHQLQL LQLWLDWLRQSKDVHDQGWKH\DUHWKHJRYHUQLQJIDFWRUVRQFHDFWLYHFRUURVLRQKDVEHHQLQL
WLDWHGLHLQWKHSURSDJDWLRQSKDVH7KXVLQSULQFLSOHWKHFKDUDFWHULVWLFVRIWKHFRQ WLDWHGLHLQWKHSURSDJDWLRQSKDVH7KXVLQSULQFLSOHWKHFKDUDFWHULVWLFVRIWKHFRQ
FUHWH FRYHU LQ UHODWLRQ WR WKH H[SRVXUH FRQGLWLRQV JRYHUQ WKH FRUURVLRQ RI WKH UHLQ FUHWH FRYHU LQ UHODWLRQ WR WKH H[SRVXUH FRQGLWLRQV JRYHUQ WKH FRUURVLRQ RI WKH UHLQ
IRUFHPHQW IRUFHPHQW
,Q6HFWLRQWKHSRWHQWLDWLQJHIIHFWRIFUDFNVRQWKHLQJUHVVRIVSHFLHVDQGKHQFHRQ ,Q6HFWLRQWKHSRWHQWLDWLQJHIIHFWRIFUDFNVRQWKHLQJUHVVRIVSHFLHVDQGKHQFHRQ
WKHLQLWLDWLRQDQGSURSDJDWLRQRIUHLQIRUFHPHQWFRUURVLRQZDVLQGLFDWHG&UDFNLQJRI WKHLQLWLDWLRQDQGSURSDJDWLRQRIUHLQIRUFHPHQWFRUURVLRQZDVLQGLFDWHG&UDFNLQJRI
FRQFUHWHDQGWKHHIIHFWRIFUDFNVRQWKHIDFWRUVJRYHUQLQJUHLQIRUFHPHQWFRUURVLRQDUH FRQFUHWHDQGWKHHIIHFWRIFUDFNVRQWKHIDFWRUVJRYHUQLQJUHLQIRUFHPHQWFRUURVLRQDUH

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO

GHDOWZLWKLQ6HFWLRQ,Q6HFWLRQVDQGLQJUHVV GHDOWZLWKLQ6HFWLRQ,Q6HFWLRQVDQGLQJUHVV
RIR[\JHQLQJUHVVRIFDUERQGLR[LGHLQJUHVVRIFKORULGHLRQVDQGWKHLRQPRELOLW\LQ RIR[\JHQLQJUHVVRIFDUERQGLR[LGHLQJUHVVRIFKORULGHLRQVDQGWKHLRQPRELOLW\LQ
FRQFUHWHDUHVXPPDULVHG)RUDPRUHGHWDLOHGGHVFULSWLRQRIWKHVHSURSHUWLHVLQSDU FRQFUHWHDUHVXPPDULVHG)RUDPRUHGHWDLOHGGHVFULSWLRQRIWKHVHSURSHUWLHVLQSDU
WLFXODU ZLWK UHJDUG WR VWUXFWXUDO VLWXDWLRQV DQG UHDO HQYLURQPHQWDO FRQGLWLRQV ZKLFK WLFXODU ZLWK UHJDUG WR VWUXFWXUDO VLWXDWLRQV DQG UHDO HQYLURQPHQWDO FRQGLWLRQV ZKLFK
DUH RQO\ PDUJLQDOO\ WUHDWHG LQ WKH SUHVHQW WKHVLVUHIHUHQFH LV PDGH WR VWDQGDUG WH[W DUH RQO\ PDUJLQDOO\ WUHDWHG LQ WKH SUHVHQW WKHVLVUHIHUHQFH LV PDGH WR VWDQGDUG WH[W
ERRNVHJ>%HQWXUHWDO&LJQDHWDO%HUWROLQLHWDO%|KQLHWDO ERRNVHJ>%HQWXUHWDO&LJQDHWDO%HUWROLQLHWDO%|KQLHWDO
5DXSDFKHWDO@ 5DXSDFKHWDO@

 ,QJUHVVRI2[\JHQ  ,QJUHVVRI2[\JHQ


7KHGLIIXVLRQFRHIILFLHQWRIR[\JHQWKURXJKWKHFHPHQWSDVWHKDVEHHQVSHFLILHGWREH 7KHGLIIXVLRQFRHIILFLHQWRIR[\JHQWKURXJKWKHFHPHQWSDVWHKDVEHHQVSHFLILHGWREH
LQWKHUDQJHRI×íWR×íPVZKLOHWKHVSHFLILFYDOXHLVGHSHQGHQWRQWKH LQWKHUDQJHRI×íWR×íPVZKLOHWKHVSHFLILFYDOXHLVGHSHQGHQWRQWKH
SRUHVWUXFWXUHDQGRQWKHGHJUHHRIVDWXUDWLRQ>7XXWWL%HQWXUHWDO%HU SRUHVWUXFWXUHDQGRQWKHGHJUHHRIVDWXUDWLRQ>7XXWWL%HQWXUHWDO%HU
WROLQLHWDO%|KQLHWDO@$VPHQWLRQHGLQ6HFWLRQWKHµZF¶KDVD WROLQLHWDO%|KQLHWDO@$VPHQWLRQHGLQ6HFWLRQWKHµZF¶KDVD
PDMRUHIIHFWRQWKHSRUHVWUXFWXUH7KHHIIHFWRIWKHµZF¶DQGWKHGHJUHHRIVDWXUDWLRQ PDMRUHIIHFWRQWKHSRUHVWUXFWXUH7KHHIIHFWRIWKHµZF¶DQGWKHGHJUHHRIVDWXUDWLRQ
RQ WKH R[\JHQ GLIIXVLRQ FDQ EH H[HPSOLILHG E\ VHOHFWHG UHVXOWV IURP )LJXUH  >$@ RQ WKH R[\JHQ GLIIXVLRQ FDQ EH H[HPSOLILHG E\ VHOHFWHG UHVXOWV IURP )LJXUH  >$@
DQG>%@UHVSHFWLYHO\ DQG>%@UHVSHFWLYHO\

 
)LJXUH (IIHFWRIFHPHQWSDVWHSURSHUWLHVRQR[\JHQGLIIXVLRQFRHIILFLHQW$IWHU )LJXUH (IIHFWRIFHPHQWSDVWHSURSHUWLHVRQR[\JHQGLIIXVLRQFRHIILFLHQW$IWHU
>7XXWWL@ >$@ (IIHFWRIµZF¶RQWKHR[\JHQGLIIXVLRQFRHIILFLHQW >7XXWWL@ >$@ (IIHFWRIµZF¶RQWKHR[\JHQGLIIXVLRQFRHIILFLHQW
LQFHPHQWSDVWHDWZDWHUVDWXUDWLRQ >%@ (IIHFWRIZDWHUVDWXUD LQFHPHQWSDVWHDWZDWHUVDWXUDWLRQ >%@ (IIHFWRIZDWHUVDWXUD
WLRQRQWKHR[\JHQGLIIXVLRQFRHIILFLHQWRIDQGµZF¶FHPHQW WLRQRQWKHR[\JHQGLIIXVLRQFRHIILFLHQWRIDQGµZF¶FHPHQW
SDVWHV SDVWHV
)RUH[DPSOHIURP )LJXUH>$@LWFDQEHFRQFOXGHGWKDWIRUFHPHQWSDVWHDW )RUH[DPSOHIURP )LJXUH>$@LWFDQEHFRQFOXGHGWKDWIRUFHPHQWSDVWHDW
VDWXUDWLRQ WKH HIIHFWLYH R[\JHQ GLIIXVLRQ FRHIILFLHQW RI  µZF¶ SDVWH LV DOPRVW DQ VDWXUDWLRQ WKH HIIHFWLYH R[\JHQ GLIIXVLRQ FRHIILFLHQW RI  µZF¶ SDVWH LV DOPRVW DQ
RUGHURIPDJQLWXGHKLJKHUWKDQWKHRQHRIµZF¶SDVWH)LJXUH>%@VKRZVWKDW RUGHURIPDJQLWXGHKLJKHUWKDQWKHRQHRIµZF¶SDVWH)LJXUH>%@VKRZVWKDW
IRULQVWDQFHDGHFUHPHQWRIVDWXUDWLRQIURPWRLQFUHDVHVWKHR[\JHQGLIIX IRULQVWDQFHDGHFUHPHQWRIVDWXUDWLRQIURPWRLQFUHDVHVWKHR[\JHQGLIIX
VLRQFRHIILFLHQWRIµZF¶SDVWHPRUHWKDQDQRUGHURIPDJQLWXGHDQGWKHRQHRI VLRQFRHIILFLHQWRIµZF¶SDVWHPRUHWKDQDQRUGHURIPDJQLWXGHDQGWKHRQHRI
µZF¶SDVWHPRUHWKDQWZRRUGHUVRIPDJQLWXGH µZF¶SDVWHPRUHWKDQWZRRUGHUVRIPDJQLWXGH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH

 ,QJUHVVRI&DUERQ'LR[LGH  ,QJUHVVRI&DUERQ'LR[LGH


&DUERQDWLRQWDNHVSODFHLQPRLVWHQYLURQPHQWVZKHUHDWPRVSKHULF&2IRUPVDQDFLG &DUERQDWLRQWDNHVSODFHLQPRLVWHQYLURQPHQWVZKHUHDWPRVSKHULF&2IRUPVDQDFLG
DTXHRXV VROXWLRQ WKDW UHDFWV ZLWK WKH K\GUDWHG FHPHQW SDVWH DQG WKHUHE\ QHXWUDOLVHV DTXHRXV VROXWLRQ WKDW UHDFWV ZLWK WKH K\GUDWHG FHPHQW SDVWH DQG WKHUHE\ QHXWUDOLVHV
WKHDONDOLQLW\RIWKHFRQFUHWH&RUURVLRQLQGXFLQJFRQGLWLRQVIRUFDUERQVWHHOLQFRQ WKHDONDOLQLW\RIWKHFRQFUHWH&RUURVLRQLQGXFLQJFRQGLWLRQVIRUFDUERQVWHHOLQFRQ
FUHWHFDQJHQHUDOO\EHUHJDUGHGWREHDWWDLQHGDWDS+DSSURDFKLQJQHXWUDOLW\ DWWKH FUHWHFDQJHQHUDOO\EHUHJDUGHGWREHDWWDLQHGDWDS+DSSURDFKLQJQHXWUDOLW\ DWWKH
OHYHO RI WKH UHLQIRUFHPHQW LI WKH FRQFUHWH LV IUHH RI RWKHU FRUURVLRQ SURPRWLQJ VXE OHYHO RI WKH UHLQIRUFHPHQW LI WKH FRQFUHWH LV IUHH RI RWKHU FRUURVLRQ SURPRWLQJ VXE
VWDQFHVLQSDUWLFXODUGHSDVVLYDWLQJLRQVLHPRVWLPSRUWDQWO\FKORULGHLRQV6RLIWKH VWDQFHVLQSDUWLFXODUGHSDVVLYDWLQJLRQVLHPRVWLPSRUWDQWO\FKORULGHLRQV6RLIWKH
FDUERQDWHGFRQFUHWHLVQRWFRQWDPLQDWHGE\FKORULGHLRQVWKHSRUHVROXWLRQLVDOPRVW FDUERQDWHGFRQFUHWHLVQRWFRQWDPLQDWHGE\FKORULGHLRQVWKHSRUHVROXWLRQLVDOPRVW
FRPSRVHGRI³SXUHZDWHU´ FIURZWKUHHRI7DEOHLQ6HFWLRQ ZKLFKPHDQV FRPSRVHGRI³SXUHZDWHU´ FIURZWKUHHRI7DEOHLQ6HFWLRQ ZKLFKPHDQV
WKDW LQ SULQFLSOH FDUERQ VWHHO LQ KXPLG FDUERQDWHG FRQFUHWH FRUURGHV DV LQ FRQWDFW WKDW LQ SULQFLSOH FDUERQ VWHHO LQ KXPLG FDUERQDWHG FRQFUHWH FRUURGHV DV LQ FRQWDFW
ZLWKZDWHU2XUPRGHOIRUWKHGHVFULSWLRQRIFDUERQDWLRQLQGXFHGFRUURVLRQLVJLYHQLQ ZLWKZDWHU2XUPRGHOIRUWKHGHVFULSWLRQRIFDUERQDWLRQLQGXFHGFRUURVLRQLVJLYHQLQ
6HFWLRQ$QRWKHULPSRUWDQWFRQVHTXHQFHRIFDUERQDWLRQLVWKDWFKORULGHZKLFK 6HFWLRQ$QRWKHULPSRUWDQWFRQVHTXHQFHRIFDUERQDWLRQLVWKDWFKORULGHZKLFK
KDVEHHQIL[DWHGLQWKHSDVWH FKORULGHELQGLQJFI6HFWLRQ LVOLEHUDWHGZLWK KDVEHHQIL[DWHGLQWKHSDVWH FKORULGHELQGLQJFI6HFWLRQ LVOLEHUDWHGZLWK
GHFUHDVLQJS+PDNLQJWKHSRUHVROXWLRQHYHQPRUHDJJUHVVLYH FIURZILYHRI7DEOH GHFUHDVLQJS+PDNLQJWKHSRUHVROXWLRQHYHQPRUHDJJUHVVLYH FIURZILYHRI7DEOH
LQ6HFWLRQ  LQ6HFWLRQ 
7KHFDUERQDWLRQUHDFWLRQVWDUWVDWWKHH[WHUQDOVXUIDFHDQGSHQHWUDWHVLQWRWKHFRQFUHWH 7KHFDUERQDWLRQUHDFWLRQVWDUWVDWWKHH[WHUQDOVXUIDFHDQGSHQHWUDWHVLQWRWKHFRQFUHWH
$VPHQWLRQHGLQ6HFWLRQWKHDONDOLQHFRQVWLWXHQWVRIFRQFUHWHDUHPRVWO\SUHVHQW $VPHQWLRQHGLQ6HFWLRQWKHDONDOLQHFRQVWLWXHQWVRIFRQFUHWHDUHPRVWO\SUHVHQW
LQWKHSRUHOLTXLGPDLQO\DVVRGLXPDQGSRWDVVLXPK\GUR[LGHVEXWDOVRLQWKHVROLG LQWKHSRUHOLTXLGPDLQO\DVVRGLXPDQGSRWDVVLXPK\GUR[LGHVEXWDOVRLQWKHVROLG
K\GUDWLRQSURGXFWVHJ&D 2+ RUµ&6+¶&DOFLXPK\GUR[LGHLVWKHK\GUDWHLQWKH K\GUDWLRQSURGXFWVHJ&D 2+ RUµ&6+¶&DOFLXPK\GUR[LGHLVWKHK\GUDWHLQWKH
FHPHQW SDVWH WKDW UHDFWV PRVW UHDGLO\ ZLWK &2 HJ GHVFULEHG E\ FHPHQW SDVWH WKDW UHDFWV PRVW UHDGLO\ ZLWK &2 HJ GHVFULEHG E\
>)UHLHVOHEHQ+DQVHQ@ >)UHLHVOHEHQ+DQVHQ@

&2   &D ( 2+ ) → &D&2 +  2 ( Δ* 


= −  N- )  >@ &2   &D ( 2+ ) → &D&2 +  2 ( Δ* 
= −  N- )  >@

&DUERQDWLRQGRHVQRWFDXVHDQ\GDPDJHWR3RUWODQGFHPHQWFRQFUHWHLWVHOIDOWKRXJKLW &DUERQDWLRQGRHVQRWFDXVHDQ\GDPDJHWR3RUWODQGFHPHQWFRQFUHWHLWVHOIDOWKRXJKLW
FDQ FDXVH WKH FRQFUHWH WR VKULQN ZKLFK FDQ OHDG WR FUDFNLQJ FI 6HFWLRQ   FDQ FDXVH WKH FRQFUHWH WR VKULQN ZKLFK FDQ OHDG WR FUDFNLQJ FI 6HFWLRQ  
(VSHFLDOO\IRU3RUWODQGFHPHQWFDUERQDWLRQFDQHYHQUHGXFHWKHSRURVLW\DQGOHDGWR (VSHFLDOO\IRU3RUWODQGFHPHQWFDUERQDWLRQFDQHYHQUHGXFHWKHSRURVLW\DQGOHDGWR
DQLQFUHDVHGVWUHQJWK,QFRQWUDVWWRWKDWWKHSRURVLW\RIFRQFUHWHZLWKKLJKVODJFRQ DQLQFUHDVHGVWUHQJWK,QFRQWUDVWWRWKDWWKHSRURVLW\RIFRQFUHWHZLWKKLJKVODJFRQ
WHQWLVLQFUHDVHGE\FDUERQDWLRQ WHQWLVLQFUHDVHGE\FDUERQDWLRQ
,WKDVEHHQVXJJHVWHGWKDWWKHGLIIXVLRQFRHIILFLHQWRIFDUERQGLR[LGHLVVLPLODUWRWKH ,WKDVEHHQVXJJHVWHGWKDWWKHGLIIXVLRQFRHIILFLHQWRIFDUERQGLR[LGHLVVLPLODUWRWKH
RQHRIR[\JHQ>7XXWWL%HQWXUHWDO@7KHWLPHGHSHQGHQWSHQHWUDWLRQRI RQHRIR[\JHQ>7XXWWL%HQWXUHWDO@7KHWLPHGHSHQGHQWSHQHWUDWLRQRI
FDUERQDWLRQLVJHQHUDOO\GHVFULEHGE\ FDUERQDWLRQLVJHQHUDOO\GHVFULEHGE\
 
G = N FDU × W Q  >@ G = N FDU × W Q  >@

ZKHUH µG¶ LVWKHGHSWKRIFDUERQDWLRQLQ>PP@DQGµW¶LVWLPHLQ\HDUVDQG µNFDU¶ LQ ZKHUH µG¶ LVWKHGHSWKRIFDUERQDWLRQLQ>PP@DQGµW¶LVWLPHLQ\HDUVDQG µNFDU¶ LQ
>PP\Q@LVDFRQVWDQWZKLFKGHSHQGVRQWKHHIIHFWLYHGLIIXVLYLW\RI&2LQWKHFRQ >PP\Q@LVDFRQVWDQWZKLFKGHSHQGVRQWKHHIIHFWLYHGLIIXVLYLW\RI&2LQWKHFRQ
FUHWHWKHDPELHQW&2FRQFHQWUDWLRQDQGWKHUHDFWLYLW\RIWKHFHPHQWSDVWHZLWK&2 FUHWHWKHDPELHQW&2FRQFHQWUDWLRQDQGWKHUHDFWLYLW\RIWKHFHPHQWSDVWHZLWK&2
 

,WDSSHDUVWKDWWKHUHDUHGLIIHUHQWFRQFHSWVFRQFHUQLQJWKHFULWLFDOS+LQWKHOLWHUDWXUH6RPHOLWHUDWXUH ,WDSSHDUVWKDWWKHUHDUHGLIIHUHQWFRQFHSWVFRQFHUQLQJWKHFULWLFDOS+LQWKHOLWHUDWXUH6RPHOLWHUDWXUH
FRQVLGHUVWKHFULWLFDOS+DVEHLQJFORVHWRQHXWUDOLW\ZKHUHDVRWKHUOLWHUDWXUHUHIHUVWRS+RUHYHQ FRQVLGHUVWKHFULWLFDOS+DVEHLQJFORVHWRQHXWUDOLW\ZKHUHDVRWKHUOLWHUDWXUHUHIHUVWRS+RUHYHQ
S+:HGHFLGHGWREDVHRXUFRQVLGHUDWLRQVZLWKUHJDUGWRFDUERQDWLRQLQGXFHGFRUURVLRQRQDEXON S+:HGHFLGHGWREDVHRXUFRQVLGHUDWLRQVZLWKUHJDUGWRFDUERQDWLRQLQGXFHGFRUURVLRQRQDEXON
S+RI FI6HFWLRQ  S+RI FI6HFWLRQ 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO

XQGHU WKH SUHYDLOLQJ PRLVWXUH FRQGLWLRQV 7KH LQYHUVH H[SRQHQW µQ¶  LV XVXDOO\ XQGHU WKH SUHYDLOLQJ PRLVWXUH FRQGLWLRQV 7KH LQYHUVH H[SRQHQW µQ¶  LV XVXDOO\
DERXW+RZHYHUWKHUDWHRIFDUERQDWLRQGHFUHDVHVZLWKWLPHDVWKH&2KDVWRGLI DERXW+RZHYHUWKHUDWHRIFDUERQDWLRQGHFUHDVHVZLWKWLPHDVWKH&2KDVWRGLI
IXVH WKURXJK WKH SRUHV RI WKH DOUHDG\ FDUERQDWHG RXWHU OD\HUV ,Q KLJKO\ LPSHUYLRXV IXVH WKURXJK WKH SRUHV RI WKH DOUHDG\ FDUERQDWHG RXWHU OD\HUV ,Q KLJKO\ LPSHUYLRXV
FRQFUHWHWKHFDUERQDWLRQUDWHHYHQWHQGVWREHFRPHQHJOLJLEOHDIWHUDFHUWDLQWLPH FRQFUHWHWKHFDUERQDWLRQUDWHHYHQWHQGVWREHFRPHQHJOLJLEOHDIWHUDFHUWDLQWLPH
7KH FKHPLFDO UHDFWLRQ UDWH RI FDUERQDWLRQ GHSHQGV ODUJHO\ RQ WKH DPELHQW UHODWLYH 7KH FKHPLFDO UHDFWLRQ UDWH RI FDUERQDWLRQ GHSHQGV ODUJHO\ RQ WKH DPELHQW UHODWLYH
KXPLGLW\$VVKRZQLQ)LJXUH>$@&2ZLOOKDUGO\UHDFWZLWKFRPSOHWHO\GU\FRQ KXPLGLW\$VVKRZQLQ)LJXUH>$@&2ZLOOKDUGO\UHDFWZLWKFRPSOHWHO\GU\FRQ
FUHWH DQG &2 FDQQRW SHQHWUDWH IXOO\ VDWXUDWHG FRQFUHWH 7KH LQWHUYDO ZKLFK LV PRVW FUHWH DQG &2 FDQQRW SHQHWUDWH IXOO\ VDWXUDWHG FRQFUHWH 7KH LQWHUYDO ZKLFK LV PRVW
FULWLFDOLQSURPRWLQJFDUERQDWLRQLVIURPWRUHODWLYHKXPLGLW\LHPRLVWXUH FULWLFDOLQSURPRWLQJFDUERQDWLRQLVIURPWRUHODWLYHKXPLGLW\LHPRLVWXUH
FRQWHQWVORZHQRXJKWRSHUPLWUHDG\SHQHWUDWLRQE\WKH&2JDVEXWKLJKHQRXJKVR FRQWHQWVORZHQRXJKWRSHUPLWUHDG\SHQHWUDWLRQE\WKH&2JDVEXWKLJKHQRXJKVR
WKDWWKHUHLVVXIILFLHQWZDWHUIRU&2FKHPLFDOUHDFWLRQ WKDWWKHUHLVVXIILFLHQWZDWHUIRU&2FKHPLFDOUHDFWLRQ

 
)LJXUH 6FKHPDWLF UHSUHVHQWDWLRQ RI WKH UDWH RI FDUERQDWLRQ RI FRQFUHWH DV D )LJXUH 6FKHPDWLF UHSUHVHQWDWLRQ RI WKH UDWH RI FDUERQDWLRQ RI FRQFUHWH DV D
IXQFWLRQRIUHODWLYHKXPLGLW\$IWHU>%HUWROLQLHWDO@ IXQFWLRQRIUHODWLYHKXPLGLW\$IWHU>%HUWROLQLHWDO@
0HDVXUHPHQWRIWKHGHSWKRIFDUERQDWLRQDUHQRUPDOO\FDUULHGRXWE\VSUD\LQJDQLQ 0HDVXUHPHQWRIWKHGHSWKRIFDUERQDWLRQDUHQRUPDOO\FDUULHGRXWE\VSUD\LQJDQLQ
GLFDWRURQDIUHVKO\EURNHQVSOLWIDFHVZKLFKDUHLQSUDFWLFHRIWHQREWDLQHGIURPHJ GLFDWRURQDIUHVKO\EURNHQVSOLWIDFHVZKLFKDUHLQSUDFWLFHRIWHQREWDLQHGIURPHJ
FRUHV>0D\VHWDO%URRPILHOG@ FRUHV>0D\VHWDO%URRPILHOG@
1RUPDOO\ DQ DOFRKROLF VROXWLRQ RI SKHQROSKWKDOHLQ &+2  LV XVHG DV LQGLFDWRU 1RUPDOO\ DQ DOFRKROLF VROXWLRQ RI SKHQROSKWKDOHLQ &+2  LV XVHG DV LQGLFDWRU
6XFKVROXWLRQVZKLFKDUHFRPPHUFLDOO\DOVRNQRZQDVGHHSSXUSOHLQGLFDWRUV HJE\ 6XFKVROXWLRQVZKLFKDUHFRPPHUFLDOO\DOVRNQRZQDVGHHSSXUSOHLQGLFDWRUV HJE\
*HUPDQQ ,QVWUXPHQWV  DUH TXDOLWDWLYH LH ³SRVLWLYHQHJDWLYH´  LQGLFDWRUV WR GHWHU *HUPDQQ ,QVWUXPHQWV  DUH TXDOLWDWLYH LH ³SRVLWLYHQHJDWLYH´  LQGLFDWRUV WR GHWHU
PLQHORFDWLRQRIWKHFDUERQDWLRQIURQW$UHDVZKHUHWKHS+H[FHHGVWRWDNHRQ PLQHORFDWLRQRIWKHFDUERQDWLRQIURQW$UHDVZKHUHWKHS+H[FHHGVWRWDNHRQ
DSLQNLVKFRORXUZKLFKLVW\SLFDOIRUSKHQROSKWKDOHLQLQDEDVLFHQYLURQPHQWZKHUHDV DSLQNLVKFRORXUZKLFKLVW\SLFDOIRUSKHQROSKWKDOHLQLQDEDVLFHQYLURQPHQWZKHUHDV
WKHFRORXURIFDUERQDWHGDUHDVUHPDLQVXQFKDQJHGVHH7DEOH WKHFRORXURIFDUERQDWHGDUHDVUHPDLQVXQFKDQJHGVHH7DEOH
0RUHVRSKLVWLFDWHGLQGLFDWRUV HJWKHUDLQERZLQGLFDWRUZKLFKDOVRLVFRPPHUFLDOO\ 0RUHVRSKLVWLFDWHGLQGLFDWRUV HJWKHUDLQERZLQGLFDWRUZKLFKDOVRLVFRPPHUFLDOO\
DYDLODEOH IURP *HUPDQQ ,QVWUXPHQWV  SURYLGH D VHW RI GLIIHUHQW FRORXUV WKDW FDQ EH DYDLODEOH IURP *HUPDQQ ,QVWUXPHQWV  SURYLGH D VHW RI GLIIHUHQW FRORXUV WKDW FDQ EH
DVVRFLDWHGZLWKFHUWDLQUDQJHVRIFRQFUHWHS+DVLOOXVWUDWHGLQ7DEOH DVVRFLDWHGZLWKFHUWDLQUDQJHVRIFRQFUHWHS+DVLOOXVWUDWHGLQ7DEOH

 

*HUPDQQ,QVWUXPHQWV$6&RSHQKDJHQ'HQPDUN *HUPDQQ,QVWUXPHQWV$6&RSHQKDJHQ'HQPDUN

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH

7DEOH &RORXU FRGH IRU WKH GHHS SXUSOH DQG WKH UDLQERZ LQGLFDWRU FRPPHU 7DEOH &RORXU FRGH IRU WKH GHHS SXUSOH DQG WKH UDLQERZ LQGLFDWRU FRPPHU
FLDOO\ DYDLODEOH IURP *HUPDQQ ,QVWUXPHQWV $IWHU >&DPSEHOO HWDO FLDOO\ DYDLODEOH IURP *HUPDQQ ,QVWUXPHQWV $IWHU >&DPSEHOO HWDO
*,@ *,@
,QGLFDWRU S+DQGDVVRFLDWHGFRORXU ,QGLFDWRU S+DQGDVVRFLDWHGFRORXU
'HHSSXUSOHLQGLFDWRU  ! 'HHSSXUSOHLQGLFDWRU  !
5DLQERZLQGLFDWRU      5DLQERZLQGLFDWRU     
 
%RWKSKHQROSKWKDOHLQDQGWKHUDLQERZLQGLFDWRUKDYHEHHQDSSOLHGLQRXUH[SHULPHQ %RWKSKHQROSKWKDOHLQDQGWKHUDLQERZLQGLFDWRUKDYHEHHQDSSOLHGLQRXUH[SHULPHQ
WDO LQYHVWLJDWLRQV +RZHYHU WKH DSSOLFDWLRQ DLPHG DW HVWLPDWLRQ RI WKH EXON S+ DQG WDO LQYHVWLJDWLRQV +RZHYHU WKH DSSOLFDWLRQ DLPHG DW HVWLPDWLRQ RI WKH EXON S+ DQG
WKHS+LQWKHYLFLQLW\RIWKHFRQFUHWHVWHHOLQWHUIDFH FI6HFWLRQ UDWKHUWKDQRQWKH WKHS+LQWKHYLFLQLW\RIWKHFRQFUHWHVWHHOLQWHUIDFH FI6HFWLRQ UDWKHUWKDQRQWKH
FKDUDFWHULVDWLRQRIWKHFDUERQDWLRQIURQW([SHULPHQWDOUHVXOWVZKLFKDUHEDVHGRQWKH FKDUDFWHULVDWLRQRIWKHFDUERQDWLRQIURQW([SHULPHQWDOUHVXOWVZKLFKDUHEDVHGRQWKH
DSSOLFDWLRQRISKHQROSKWKDOHLQDQGWKHUDLQERZLQGLFDWRUDUHH[HPSOLILHGLQ6HFWLRQ DSSOLFDWLRQRISKHQROSKWKDOHLQDQGWKHUDLQERZLQGLFDWRUDUHH[HPSOLILHGLQ6HFWLRQ
 

 ,QJUHVVRI&KORULGH,RQV  ,QJUHVVRI&KORULGH,RQV


0RVWRIWHQFULWLFDOFKORULGHFRQWHQWVLQFRQFUHWHDULVHZLWKSHQHWUDWLRQRIFKORULGHLRQV 0RVWRIWHQFULWLFDOFKORULGHFRQWHQWVLQFRQFUHWHDULVHZLWKSHQHWUDWLRQRIFKORULGHLRQV
WKURXJKWKHFRQFUHWHFRYHUIURPWKHRXWVLGHZKHQWKHH[WHUQDOVXUIDFHRIWKHVWUXFWXUH WKURXJKWKHFRQFUHWHFRYHUIURPWKHRXWVLGHZKHQWKHH[WHUQDOVXUIDFHRIWKHVWUXFWXUH
LVH[SRVHGWRHJVHDVDOWVSUD\GLUHFWVHDZDWHURUGHLFLQJVDOW+RZHYHUFKORULGHV LVH[SRVHGWRHJVHDVDOWVSUD\GLUHFWVHDZDWHURUGHLFLQJVDOW+RZHYHUFKORULGHV
FDQDOVREHLQFRUSRUDWHGLQWRWKHRULJLQDOPL[GXHWRWKHLUSUHVHQFHLQWKHFRQVWLWXHQW FDQDOVREHLQFRUSRUDWHGLQWRWKHRULJLQDOPL[GXHWRWKHLUSUHVHQFHLQWKHFRQVWLWXHQW
PDWHULDOVRUDVDFFHSWHGXQWLOWKHPLGVLQ(XURSHIRUDFFHOHUDWLRQRIFHPHQWK\ PDWHULDOVRUDVDFFHSWHGXQWLOWKHPLGVLQ(XURSHIRUDFFHOHUDWLRQRIFHPHQWK\
GUDWLRQGHOLEHUDWHO\DGGHGDVFDOFLXPFKORULGH &D&O 1RZDGD\VGHVLJQFRGHVIRU GUDWLRQGHOLEHUDWHO\DGGHGDVFDOFLXPFKORULGH &D&O 1RZDGD\VGHVLJQFRGHVIRU
UHLQIRUFHG DQG SUHVWUHVVHG VWUXFWXUHV LPSRVH UHVWULFWLRQV RQ WKH DPRXQW RI FKORULGH UHLQIRUFHG DQG SUHVWUHVVHG VWUXFWXUHV LPSRVH UHVWULFWLRQV RQ WKH DPRXQW RI FKORULGH
LQWURGXFHGWRWKHFRQFUHWHPL[IURPFRQVWLWXHQWPDWHULDOV)RULQVWDQFH>'6(1 LQWURGXFHGWRWKHFRQFUHWHPL[IURPFRQVWLWXHQWPDWHULDOV)RULQVWDQFH>'6(1
 @ OLPLWV WKH PD[LPXP FKORULGH FRQWHQW WR  DQG  µZZFH¶ IRU UHLQ  @ OLPLWV WKH PD[LPXP FKORULGH FRQWHQW WR  DQG  µZZFH¶ IRU UHLQ
IRUFHGDQGWRDQGµZZFH¶IRUSUHVWUHVVHGFRQFUHWHVWUXFWXUHV7KHFKORULGH IRUFHGDQGWRDQGµZZFH¶IRUSUHVWUHVVHGFRQFUHWHVWUXFWXUHV7KHFKORULGH
FRQWHQWFODVVZKLFKGHSHQGVRQWKHSURYLVLRQVYDOLGLQWKHSODFHRIXVH RIWKHFRQ FRQWHQWFODVVZKLFKGHSHQGVRQWKHSURYLVLRQVYDOLGLQWKHSODFHRIXVH RIWKHFRQ
FUHWH GHWHUPLQHV ZKLFK RI WKH WZR VSHFLILHG YDOXHV LV JRYHUQLQJ 0RUHRYHU LW LV FUHWH GHWHUPLQHV ZKLFK RI WKH WZR VSHFLILHG YDOXHV LV JRYHUQLQJ 0RUHRYHU LW LV
VSHFLILHG WKDW FDOFLXP FKORULGH DQG FKORULGH EDVHG DGPL[WXUHV VKDOO QRW EH DGGHG WR VSHFLILHG WKDW FDOFLXP FKORULGH DQG FKORULGH EDVHG DGPL[WXUHV VKDOO QRW EH DGGHG WR
FRQFUHWHFRQWDLQLQJVWHHOUHLQIRUFHPHQWSUHVWUHVVLQJVWHHOUHLQIRUFHPHQWRURWKHUHP FRQFUHWHFRQWDLQLQJVWHHOUHLQIRUFHPHQWSUHVWUHVVLQJVWHHOUHLQIRUFHPHQWRURWKHUHP
EHGGHGPHWDO)RUVWUXFWXUHV ³QRWFRQWDLQLQJVWHHOUHLQIRUFHPHQWRURWKHUHPEHGGHG EHGGHGPHWDO)RUVWUXFWXUHV ³QRWFRQWDLQLQJVWHHOUHLQIRUFHPHQWRURWKHUHPEHGGHG
PHWDOZLWKWKHH[FHSWLRQRIFRUURVLRQUHVLVWLQJOLIWLQJGHYLFHV´>'6(1@ PHWDOZLWKWKHH[FHSWLRQRIFRUURVLRQUHVLVWLQJOLIWLQJGHYLFHV´>'6(1@
OLPLWVWKHFKORULGHFRQWHQWWRµZZFH¶ OLPLWVWKHFKORULGHFRQWHQWWRµZZFH¶
7KH FKORULGH GLIIXVLRQ FRHIILFLHQW LQ FRQFUHWH LV ORZHU WKDQ WKH RQH RI R[\JHQ DQG 7KH FKORULGH GLIIXVLRQ FRHIILFLHQW LQ FRQFUHWH LV ORZHU WKDQ WKH RQH RI R[\JHQ DQG
&2,WKDVEHHQGHWHUPLQHGWREHLQWKHUDQJHIURPíPVWRíPV>7XXWWL &2,WKDVEHHQGHWHUPLQHGWREHLQWKHUDQJHIURPíPVWRíPV>7XXWWL
 1LOVVRQ HWDO  %HQWXU HWDO  %HUWROLQL HWDO @ $ PHWKRG IRU  1LOVVRQ HWDO  %HQWXU HWDO  %HUWROLQL HWDO @ $ PHWKRG IRU
WKH GHWHUPLQDWLRQ IRU WKH GLIIXVLRQ FRHIILFLHQWV KDV EHHQ VWDQGDUGLVHG LQ WKH 1RUGLF WKH GHWHUPLQDWLRQ IRU WKH GLIIXVLRQ FRHIILFLHQWV KDV EHHQ VWDQGDUGLVHG LQ WKH 1RUGLF
FRXQWULHVLH17%8,/'>)UHGHULNVHQ@$VIRUR[\JHQDQG&2GLIIXVLRQ FRXQWULHVLH17%8,/'>)UHGHULNVHQ@$VIRUR[\JHQDQG&2GLIIXVLRQ
WKHµZF¶KDVDPDMRUHIIHFWRQWKHFKORULGHGLIIXVLRQHIIHFWZKLFKKDVEHHQLQYHVWL WKHµZF¶KDVDPDMRUHIIHFWRQWKHFKORULGHGLIIXVLRQHIIHFWZKLFKKDVEHHQLQYHVWL
JDWHGDQGTXDQWLILHGLQVHYHUDOVWXGLHV6HOHFWHGUHVXOWVZKLFKLOOXVWUDWHWKDWWKHFKOR JDWHGDQGTXDQWLILHGLQVHYHUDOVWXGLHV6HOHFWHGUHVXOWVZKLFKLOOXVWUDWHWKDWWKHFKOR
ULGHGLIIXVLRQFRHIILFLHQWLQFUHDVHVODUJHO\ZLWKLQFUHDVLQJµZF¶DUHVXPPDULVHGIRU ULGHGLIIXVLRQFRHIILFLHQWLQFUHDVHVODUJHO\ZLWKLQFUHDVLQJµZF¶DUHVXPPDULVHGIRU
FHPHQWSDVWHDQGFRQFUHWHLQ7DEOH FHPHQWSDVWHDQGFRQFUHWHLQ7DEOH

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO

7DEOH (IIHFWLYHGLIIXVLRQFRHIILFLHQWRIFKORULGHLRQVWKURXJKFHPHQWSDVWHDQG 7DEOH (IIHFWLYHGLIIXVLRQFRHIILFLHQWRIFKORULGHLRQVWKURXJKFHPHQWSDVWHDQG


FRQFUHWH LQ í PVIURP GLIIHUHQW VRXUFHV >$@ >3DJH HWDO @ FRQFUHWH LQ í PVIURP GLIIHUHQW VRXUFHV >$@ >3DJH HWDO @
>%@>7XXWWL@>&@>%HUNH +LFNV@ >%@>7XXWWL@>&@>%HUNH +LFNV@

µZF¶    6RXUFH µZF¶    6RXUFH
&HPHQWSDVWH    >$@ &HPHQWSDVWH    >$@

&RQFUHWH    >%@ &RQFUHWH    >%@

&RQFUHWH    >&@ &RQFUHWH    >&@


 
,WLVGLIILFXOWWRDFNQRZOHGJHWKHVLJQLILFDQFHRIWKHYDULDWLRQVLQWKHGLIIXVLRQFRHIIL ,WLVGLIILFXOWWRDFNQRZOHGJHWKHVLJQLILFDQFHRIWKHYDULDWLRQVLQWKHGLIIXVLRQFRHIIL
FLHQWV ZLWKRXW FDOFXODWLQJ FRQFHQWUDWLRQ SURILOHV DW GLIIHUHQW DJHV 6HOHFWHG UHVXOWV FLHQWV ZLWKRXW FDOFXODWLQJ FRQFHQWUDWLRQ SURILOHV DW GLIIHUHQW DJHV 6HOHFWHG UHVXOWV
IURPWKHOLWHUDWXUHDUHVKRZQLQ)LJXUH>$@ IURPWKHOLWHUDWXUHDUHVKRZQLQ)LJXUH>$@

 
)LJXUH >$@'LIIXVLRQSURILOHVRIFKORULGHLRQVLQQRUPDODQGKLJKTXDOLW\FRQ )LJXUH >$@'LIIXVLRQSURILOHVRIFKORULGHLRQVLQQRUPDODQGKLJKTXDOLW\FRQ
FUHWH ZLWK GLIIXVLRQ FRHIILFLHQWV RI µ'¶ ×í PV DQG µ'¶  FUHWH ZLWK GLIIXVLRQ FRHIILFLHQWV RI µ'¶ ×í PV DQG µ'¶ 
×í PV UHVSHFWLYHO\ $IWHU  \HDUV RI GLIIXVLRQ DVVXPLQJ D ×í PV UHVSHFWLYHO\ $IWHU  \HDUV RI GLIIXVLRQ DVVXPLQJ D
FRQVWDQWFKORULGHLRQFRQFHQWUDWLRQRIµZZFH¶RQWKHFRQFUHWHVXU FRQVWDQWFKORULGHLRQFRQFHQWUDWLRQRIµZZFH¶RQWKHFRQFUHWHVXU
IDFH FI6HFWLRQ $IWHU>%HQWXUHWDO@ >%@ ([DPSOH RI IDFH FI6HFWLRQ $IWHU>%HQWXUHWDO@ >%@ ([DPSOH RI
FKORULGH SURILOHV LQ D PDULQH VWUXFWXUH DV D IXQFWLRQ RI WKH KHLJKW FKORULGH SURILOHV LQ D PDULQH VWUXFWXUH DV D IXQFWLRQ RI WKH KHLJKW
DERYHWKHVHDZDWHUOHYHO$IWHU>%HUWROLQLHWDO@ DERYHWKHVHDZDWHUOHYHO$IWHU>%HUWROLQLHWDO@
&RQFHQWUDWLRQSURILOHVFDQEHSUHGLFWHGEDVHGRQ)LFN¶VVHFRQGODZDVGHVFULEHGLQ &RQFHQWUDWLRQSURILOHVFDQEHSUHGLFWHGEDVHGRQ)LFN¶VVHFRQGODZDVGHVFULEHGLQ
6HFWLRQ7KHSURILOHVVKRZQLQ)LJXUH>$@ZHUHFDOFXODWHGEDVHGRQDQLQL 6HFWLRQ7KHSURILOHVVKRZQLQ)LJXUH>$@ZHUHFDOFXODWHGEDVHGRQDQLQL
WLDO VXUIDFH FKORULGH FRQFHQWUDWLRQ RI  µZZFH¶ DQG GLIIXVLRQ FRHIILFLHQWV RI WLDO VXUIDFH FKORULGH FRQFHQWUDWLRQ RI  µZZFH¶ DQG GLIIXVLRQ FRHIILFLHQWV RI
×íPV UHSUHVHQWLQJQRUPDOFRQFUHWHDQG×íPVIRUKLJKTXDOLW\FRQ ×íPV UHSUHVHQWLQJQRUPDOFRQFUHWHDQG×íPVIRUKLJKTXDOLW\FRQ
FUHWH>%HQWXUHWDO@ FUHWH>%HQWXUHWDO@
:KLOHVXFKFDOFXODWLRQVDUHXVHIXOLQSUHGLFWLQJDWOHDVWDORZHUERXQGWRWKHH[SHFWHG :KLOHVXFKFDOFXODWLRQVDUHXVHIXOLQSUHGLFWLQJDWOHDVWDORZHUERXQGWRWKHH[SHFWHG
VHUYLFHOLIHLWVKRXOGEHHPSKDVLVHGWKDWVXFKSURILOHVDUHRQO\YDOLGIRUFRQFUHWHFRQ VHUYLFHOLIHLWVKRXOGEHHPSKDVLVHGWKDWVXFKSURILOHVDUHRQO\YDOLGIRUFRQFUHWHFRQ
WLQXRXVO\DQGIXOO\VXEPHUJHGLQFKORULGHFRQWDLQLQJZDWHULHZLWKGLIIXVLRQDVWKH WLQXRXVO\DQGIXOO\VXEPHUJHGLQFKORULGHFRQWDLQLQJZDWHULHZLWKGLIIXVLRQDVWKH
VROHWUDQVSRUWPHFKDQLVP ,QSUDFWLFHWKH H[SRVXUHFRQGLWLRQVDUHRIWHQPXFKPRUH VROHWUDQVSRUWPHFKDQLVP ,QSUDFWLFHWKH H[SRVXUHFRQGLWLRQVDUHRIWHQPXFKPRUH
FRPSOH['HSHQGLQJRQWKHH[SRVXUHVLWXDWLRQDQGWKHORFDWLRQRIWKHVWUXFWXUHRUWKH FRPSOH['HSHQGLQJRQWKHH[SRVXUHVLWXDWLRQDQGWKHORFDWLRQRIWKHVWUXFWXUHRUWKH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH

VWUXFWXUDOSDUWWKHLQJUHVVRIFKORULGHLRQVLVSUHGRPLQDWHO\JRYHUQHGE\RQHRIWUDQV VWUXFWXUDOSDUWWKHLQJUHVVRIFKORULGHLRQVLVSUHGRPLQDWHO\JRYHUQHGE\RQHRIWUDQV
SRUWPHFKDQLVPVGHVFULEHGOLVWHGLQ6HFWLRQRUDFRPELQDWLRQRIWKHVH SRUWPHFKDQLVPVGHVFULEHGOLVWHGLQ6HFWLRQRUDFRPELQDWLRQRIWKHVH
)RUH[DPSOHDQH[SRVXUHVLWXDWLRQRIPDMRUFRQFHUQZLWKUHJDUGWRFKORULGHLQGXFHG )RUH[DPSOHDQH[SRVXUHVLWXDWLRQRIPDMRUFRQFHUQZLWKUHJDUGWRFKORULGHLQGXFHG
FRUURVLRQLVWKHVRFDOOHGVSODVK]RQHRIPDULQHVWUXFWXUHVZKLFKLVFRQVLGHUHGWREH FRUURVLRQLVWKHVRFDOOHGVSODVK]RQHRIPDULQHVWUXFWXUHVZKLFKLVFRQVLGHUHGWREH
ORFDWHGEHWZHHQWKUHHPHWHUVDERYHDQGWKUHHPHWHUVEHORZWKHPD[LPXPDQGPLQL ORFDWHGEHWZHHQWKUHHPHWHUVDERYHDQGWKUHHPHWHUVEHORZWKHPD[LPXPDQGPLQL
PXPVHDOHYHOUHVSHFWLYHO\>)UHGHULNVHQ 3RXOVHQ@,QWKLV]RQHFRQFUHWHLV PXPVHDOHYHOUHVSHFWLYHO\>)UHGHULNVHQ 3RXOVHQ@,QWKLV]RQHFRQFUHWHLV
H[SRVHGWRFRQVWDQWZHWWLQJE\ZDYHVDQGWLGDOFKDQJHV'U\SHULRGVFDXVHDSURJUHV H[SRVHGWRFRQVWDQWZHWWLQJE\ZDYHVDQGWLGDOFKDQJHV'U\SHULRGVFDXVHDSURJUHV
VLYHEXLOGXSRIFKORULGHRQWKHVXUIDFHRIWKHFRQFUHWHVRPHWLPHVWRYHU\KLJKOHYHOV VLYHEXLOGXSRIFKORULGHRQWKHVXUIDFHRIWKHFRQFUHWHVRPHWLPHVWRYHU\KLJKOHYHOV
$V D UHVXOW ZKHQ WKH FRQFUHWH LV UHZHWWHG WKH FKORULGH LQJUHVV UDWH LV ODUJHO\ HQ $V D UHVXOW ZKHQ WKH FRQFUHWH LV UHZHWWHG WKH FKORULGH LQJUHVV UDWH LV ODUJHO\ HQ
KDQFHG 7KXV D FRPSOH[ FRPELQDWLRQ RI WUDQVSRUW PHFKDQLVPV PDLQO\ GLIIXVLRQ KDQFHG 7KXV D FRPSOH[ FRPELQDWLRQ RI WUDQVSRUW PHFKDQLVPV PDLQO\ GLIIXVLRQ
FDSLOODU\VXFWLRQDQGHYDSRUDWLRQOHDGVWRXQSUHGLFWDEOHFKORULGHSURILOHVDVVNHWFKHG FDSLOODU\VXFWLRQDQGHYDSRUDWLRQOHDGVWRXQSUHGLFWDEOHFKORULGHSURILOHVDVVNHWFKHG
LQ)LJXUH>%@ LQ)LJXUH>%@
3DUWRIWKHFKORULGHVHQWHULQJWKHFRQFUHWHEXONZLOOEHIL[DWHGLQWKHSDVWHZKHUHERWK 3DUWRIWKHFKORULGHVHQWHULQJWKHFRQFUHWHEXONZLOOEHIL[DWHGLQWKHSDVWHZKHUHERWK
µ&6+¶ DQG UHDFWLRQ SURGXFWV RI DOXPLQD ELQGV FKORULGHV 7KLV SURFHVV LV JHQHUDOO\ µ&6+¶ DQG UHDFWLRQ SURGXFWV RI DOXPLQD ELQGV FKORULGHV 7KLV SURFHVV LV JHQHUDOO\
UHIHUUHGWRDVFKORULGHELQGLQJ&KORULGHELQGLQJLVUHYHUVLEOHHJFDUERQDWLRQFDXVHV UHIHUUHGWRDVFKORULGHELQGLQJ&KORULGHELQGLQJLVUHYHUVLEOHHJFDUERQDWLRQFDXVHV
UHOHDVHRIIL[DWHGFKORULGHV FI6HFWLRQ 7KHGLVWULEXWLRQRIFKORULGHVEHWZHHQ UHOHDVHRIIL[DWHGFKORULGHV FI6HFWLRQ 7KHGLVWULEXWLRQRIFKORULGHVEHWZHHQ
WKH GLIIHUHQW SKDVHV DQG WKH SRUH VROXWLRQ FDQ EH FDOFXODWHG E\ PHDQV RI WKHUPRG\ WKH GLIIHUHQW SKDVHV DQG WKH SRUH VROXWLRQ FDQ EH FDOFXODWHG E\ PHDQV RI WKHUPRG\
QDPLFPRGHOVJLYHQWKDWLQIRUPDWLRQRQVROXELOLW\SURGXFWVLVDYDLODEOHIRUWKHUHOH QDPLFPRGHOVJLYHQWKDWLQIRUPDWLRQRQVROXELOLW\SURGXFWVLVDYDLODEOHIRUWKHUHOH
YDQW SKDVHV IURP DVVXPHG SKDVH HTXLOLEULD LQ K\GUDWHG 3RUWODQG FHPHQW >1LHOVHQ YDQW SKDVHV IURP DVVXPHG SKDVH HTXLOLEULD LQ K\GUDWHG 3RUWODQG FHPHQW >1LHOVHQ
1LHOVHQHWDOE1LHOVHQHWDOD*HLNHUHWDO@7KHHIIHFWRI 1LHOVHQHWDOE1LHOVHQHWDOD*HLNHUHWDO@7KHHIIHFWRI
FKORULGHELQGLQJLVRIPDMRULPSRUWDQFHZLWKUHJDUGWRWKHSURSRUWLRQEHWZHHQWKHWR FKORULGHELQGLQJLVRIPDMRULPSRUWDQFHZLWKUHJDUGWRWKHSURSRUWLRQEHWZHHQWKHWR
WDOFKORULGHFRQWHQWDQGWKHFKORULGHFRQWHQWLQWKHSRUHVROXWLRQZKLFKLVJHQHUDOO\ WDOFKORULGHFRQWHQWDQGWKHFKORULGHFRQWHQWLQWKHSRUHVROXWLRQZKLFKLVJHQHUDOO\
FRQVLGHUHGWRGHWHUPLQHFRUURVLRQLQLWLDWLRQDQGSURSDJDWLRQ&RQFHUQLQJWKHFKORULGH FRQVLGHUHGWRGHWHUPLQHFRUURVLRQLQLWLDWLRQDQGSURSDJDWLRQ&RQFHUQLQJWKHFKORULGH
FRQWHQW LQ WKH SRUH VROXWLRQ W\SLFDO FRPSRVLWLRQV DUH H[HPSOLILHG LQ URZV IRXU DQG FRQWHQW LQ WKH SRUH VROXWLRQ W\SLFDO FRPSRVLWLRQV DUH H[HPSOLILHG LQ URZV IRXU DQG
ILYHRI7DEOHLQ6HFWLRQIRUFKORULGHFRQWDPLQDWHGFRQFUHWHZLWKRXWDQGZLWK ILYHRI7DEOHLQ6HFWLRQIRUFKORULGHFRQWDPLQDWHGFRQFUHWHZLWKRXWDQGZLWK
FDUERQDWLRQUHVSHFWLYHO\&KORULGHFRQWHQWVIRUFRUURVLRQLQLWLDWLRQDQGWKHSURSRVHG FDUERQDWLRQUHVSHFWLYHO\&KORULGHFRQWHQWVIRUFRUURVLRQLQLWLDWLRQDQGWKHSURSRVHG
WKHUPRG\QDPLF PHFKDQLVP IRU FKORULGH LQGXFHG FRUURVLRQ DUH GLVFXVVHG LQ 6HFWLRQV WKHUPRG\QDPLF PHFKDQLVP IRU FKORULGH LQGXFHG FRUURVLRQ DUH GLVFXVVHG LQ 6HFWLRQV
DQGUHVSHFWLYHO\ DQGUHVSHFWLYHO\
&KORULGHELQGLQJLVDOVRRIPDMRULPSRUWDQFHZLWKUHJDUGWRWKHGHWHUPLQDWLRQRIWKH &KORULGHELQGLQJLVDOVRRIPDMRULPSRUWDQFHZLWKUHJDUGWRWKHGHWHUPLQDWLRQRIWKH
FKORULGHFRQWHQWVZKLFKLVDFHQWUDOSDUWLQWKHVHUYLFHOLIHDVVHVVPHQWRIDUHLQIRUFHG FKORULGHFRQWHQWVZKLFKLVDFHQWUDOSDUWLQWKHVHUYLFHOLIHDVVHVVPHQWRIDUHLQIRUFHG
FRQFUHWHVWUXFWXUH )RULQVWDQFH DFWXDO FKORULGH SURILOHVGHWHUPLQHGIURPERUHFRUHV FRQFUHWHVWUXFWXUH )RULQVWDQFH DFWXDO FKORULGH SURILOHVGHWHUPLQHGIURPERUHFRUHV
E\SURILOHJULQGLQJDQGVXEVHTXHQWWLWUDWLRQFDQEHXVHGWRFDOLEUDWHWKHLQJUHVVPRG E\SURILOHJULQGLQJDQGVXEVHTXHQWWLWUDWLRQFDQEHXVHGWRFDOLEUDWHWKHLQJUHVVPRG
HOVHQDEOLQJDVHUYLFHOLIHXSGDWH FI6HFWLRQ 6WDQGDUGPHWKRGVIRUWKHFKHPLFDO HOVHQDEOLQJDVHUYLFHOLIHXSGDWH FI6HFWLRQ 6WDQGDUGPHWKRGVIRUWKHFKHPLFDO
GHWHUPLQDWLRQ RI WKH FKORULGH FRQWHQW RI KDUGHQHG FRQFUHWH DUH GHVFULEHG HJ LQ GHWHUPLQDWLRQ RI WKH FKORULGH FRQWHQW RI KDUGHQHG FRQFUHWH DUH GHVFULEHG HJ LQ
>'6(1@,QWKHH[SHULPHQWDOSDUWRIWKLVSURMHFWWKHVRFDOOHGFRORXUWHVW >'6(1@,QWKHH[SHULPHQWDOSDUWRIWKLVSURMHFWWKHVRFDOOHGFRORXUWHVW
>)UHGHULNVHQ@ZDVXVHGWRGHWHUPLQHWKHGHSWKRILQJUHVV6LPLODUWRWKHSKHQRO >)UHGHULNVHQ@ZDVXVHGWRGHWHUPLQHWKHGHSWKRILQJUHVV6LPLODUWRWKHSKHQRO
SKWKDOHLQWHVWGHVFULEHGLQ6HFWLRQWKHFRORXUWHVWLVDUDSLGTXDOLWDWLYHLQGLFD SKWKDOHLQWHVWGHVFULEHGLQ6HFWLRQWKHFRORXUWHVWLVDUDSLGTXDOLWDWLYHLQGLFD
WLRQRIWKHFKORULGHFRQWHQWEDVHGRQDFRORXUFKDQJHIURPDFHUWDLQFKORULGHFRQFHQ WLRQRIWKHFKORULGHFRQWHQWEDVHGRQDFRORXUFKDQJHIURPDFHUWDLQFKORULGHFRQFHQ
WUDWLRQLQWKHSRUHVROXWLRQ)RUWKHFRORXUWHVWD1VLOYHUQLWUDWH $J12  VROXWLRQ WUDWLRQLQWKHSRUHVROXWLRQ)RUWKHFRORXUWHVWD1VLOYHUQLWUDWH $J12  VROXWLRQ
LVVSUD\HGRQDVSOLWIDFHRIWKHLQYHVWLJDWHGFRQFUHWHVDPSOH$J12UHDFWVZLWKWKH LVVSUD\HGRQDVSOLWIDFHRIWKHLQYHVWLJDWHGFRQFUHWHVDPSOH$J12UHDFWVZLWKWKH
FKORULGH OHDGLQJ WR SLQNLVKJUH\ FRORXU FKDQJH IRU DUHDV RI WKH FRQFUHWH ZKHUH WKH FKORULGH OHDGLQJ WR SLQNLVKJUH\ FRORXU FKDQJH IRU DUHDV RI WKH FRQFUHWH ZKHUH WKH

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO

FRQWHQWRIFKORULGHH[FHHGVDFHUWDLQFRQFHQWUDWLRQWKDWGHSHQGVDPRQJRWKHUVRQWKH FRQWHQWRIFKORULGHH[FHHGVDFHUWDLQFRQFHQWUDWLRQWKDWGHSHQGVDPRQJRWKHUVRQWKH
FKHPLFDOFRPSRVLWLRQRIWKHPRUWDU)RULQVWDQFHWKHFKORULGHFRQFHQWUDWLRQIRUFRO FKHPLFDOFRPSRVLWLRQRIWKHPRUWDU)RULQVWDQFHWKHFKORULGHFRQFHQWUDWLRQIRUFRO
RXUFKDQJHRIPRUWDU % ZKLFKZDVXVHGDVWKH³VWDQGDUG´PRUWDULQRXUH[SHULPHQ RXUFKDQJHRIPRUWDU % ZKLFKZDVXVHGDVWKH³VWDQGDUG´PRUWDULQRXUH[SHULPHQ
WDOLQYHVWLJDWLRQV FI6HFWLRQ ZDVGHWHUPLQHGE\SURILOHJULQGLQJDQGWLWUDWLRQ WDOLQYHVWLJDWLRQV FI6HFWLRQ ZDVGHWHUPLQHGE\SURILOHJULQGLQJDQGWLWUDWLRQ
WREHLQWKHUDQJHRIµZZFH¶ WREHLQWKHUDQJHRIµZZFH¶

 ,RQ0RELOLW\  ,RQ0RELOLW\


)RUFRUURVLRQWREHLQLWLDWHGDQGWRSURSDJDWHWKHFRQFUHWHLQWKHYLFLQLW\RIWKHVWHHO )RUFRUURVLRQWREHLQLWLDWHGDQGWRSURSDJDWHWKHFRQFUHWHLQWKHYLFLQLW\RIWKHVWHHO
DOVRPXVWSURYLGHDSDWKIRUWKHLRQLFFXUUHQWEHWZHHQDQRGLFDQGFDWKRGLFVLWHVRIWKH DOVRPXVWSURYLGHDSDWKIRUWKHLRQLFFXUUHQWEHWZHHQDQRGLFDQGFDWKRGLFVLWHVRIWKH
VWHHOVXUIDFH FI6HFWLRQ 7KHWUDQVSRUWUDWHRIWKLVFXUUHQWFDQEHWKHOLPLWLQJ VWHHOVXUIDFH FI6HFWLRQ 7KHWUDQVSRUWUDWHRIWKLVFXUUHQWFDQEHWKHOLPLWLQJ
IDFWRUIRUWKHFRUURVLRQUDWHLHWKHSURSDJDWLRQSKDVHEXWLWDOVRKDVDPDMRULQIOX IDFWRUIRUWKHFRUURVLRQUDWHLHWKHSURSDJDWLRQSKDVHEXWLWDOVRKDVDPDMRULQIOX
HQFH RQ FRUURVLRQ LQLWLDWLRQ LQ SDUWLFXODU ZLWK UHJDUG WR WKH FKORULGH WKUHVKROG FI HQFH RQ FRUURVLRQ LQLWLDWLRQ LQ SDUWLFXODU ZLWK UHJDUG WR WKH FKORULGH WKUHVKROG FI
6HFWLRQ   7KH WUDQVSRUW UDWH RI LRQLF FXUUHQWV FDQ EH H[SUHVVHG LQ WHUPV RI WKH 6HFWLRQ   7KH WUDQVSRUW UDWH RI LRQLF FXUUHQWV FDQ EH H[SUHVVHG LQ WHUPV RI WKH
UHVLVWLYLW\ RI WKH FRQFUHWH ZKLFK VLPLODU WR WKH LQJUHVV SURSHUWLHV GHSHQGV RQ LWV UHVLVWLYLW\ RI WKH FRQFUHWH ZKLFK VLPLODU WR WKH LQJUHVV SURSHUWLHV GHSHQGV RQ LWV
SK\VLFDODQGFKHPLFDOFKDUDFWHULVWLFV7KHUHVLVWDQFHWRWKHLRQLFFXUUHQWIORZLHWKH SK\VLFDODQGFKHPLFDOFKDUDFWHULVWLFV7KHUHVLVWDQFHWRWKHLRQLFFXUUHQWIORZLHWKH
UHVLVWLYLW\RIWKHFRQFUHWHLVSULPDULO\LQIOXHQFHGE\WKUHHIDFWRUVWKHSRUHVWUXFWXUH UHVLVWLYLW\RIWKHFRQFUHWHLVSULPDULO\LQIOXHQFHGE\WKUHHIDFWRUVWKHSRUHVWUXFWXUH
FI 6HFWLRQ   WKH FRPSRVLWLRQ RI WKH SRUH VROXWLRQ FI 6HFWLRQ   DQG WKH FI 6HFWLRQ   WKH FRPSRVLWLRQ RI WKH SRUH VROXWLRQ FI 6HFWLRQ   DQG WKH
PRLVWXUHFRQWHQWLHWKHGHJUHHRIVDWXUDWLRQ PRLVWXUHFRQWHQWLHWKHGHJUHHRIVDWXUDWLRQ
$VGHVFULEHGLQ6HFWLRQFRQFUHWHVRIORZµZF¶KDYHDORZHUSRUHYROXPHDQG $VGHVFULEHGLQ6HFWLRQFRQFUHWHVRIORZµZF¶KDYHDORZHUSRUHYROXPHDQG
WKXVIHZHUFKDQQHOVDYDLODEOHIRULRQWUDQVSRUWVRWKDWWKHUHVLVWLYLW\LVKLJKHUWKDQWKH WKXVIHZHUFKDQQHOVDYDLODEOHIRULRQWUDQVSRUWVRWKDWWKHUHVLVWLYLW\LVKLJKHUWKDQWKH
RQHRIFRQFUHWHVRIKLJKµZF¶%HVLGHVWKHHIIHFWRIWRWDOSRUHYROXPHORZµZF¶FRQ RQHRIFRQFUHWHVRIKLJKµZF¶%HVLGHVWKHHIIHFWRIWRWDOSRUHYROXPHORZµZF¶FRQ
FUHWHV JHQHUDOO\ KDYH VPDOOHU SRUHV DQG SRUHV ZKLFK DUH PRUH HDVLO\ LVRODWHG E\ FUHWHV JHQHUDOO\ KDYH VPDOOHU SRUHV DQG SRUHV ZKLFK DUH PRUH HDVLO\ LVRODWHG E\
JURZWKRIK\GUDWLRQSURGXFWVDWFULWLFDOLQWHUFRQQHFWLRQVVRWKDWWKHUHVLVWLYLW\LVIXU JURZWKRIK\GUDWLRQSURGXFWVDWFULWLFDOLQWHUFRQQHFWLRQVVRWKDWWKHUHVLVWLYLW\LVIXU
WKHULQFUHDVHG$FFRUGLQJO\WKHUHVLVWLYLW\RIWKHFRQFUHWHLVGHSHQGHQWRQWKHVDPH WKHULQFUHDVHG$FFRUGLQJO\WKHUHVLVWLYLW\RIWKHFRQFUHWHLVGHSHQGHQWRQWKHVDPH
IDFWRUVDVWKHUHVLVWDQFHDJDLQVWLQJUHVVRIR[\JHQFDUERQGLR[LGHDQGFKORULGHLRQV IDFWRUVDVWKHUHVLVWDQFHDJDLQVWLQJUHVVRIR[\JHQFDUERQGLR[LGHDQGFKORULGHLRQV
WKDWZHUHGHVFULEHGLQ6HFWLRQVDQGUHVSHFWLYHO\ WKDWZHUHGHVFULEHGLQ6HFWLRQVDQGUHVSHFWLYHO\
7KH SRUH VROXWLRQ SURYLGHV WKH SULPDU\ PHGLXP IRU WKH LRQ WUDQVSRUW 7KLV VROXWLRQ 7KH SRUH VROXWLRQ SURYLGHV WKH SULPDU\ PHGLXP IRU WKH LRQ WUDQVSRUW 7KLV VROXWLRQ
JHQHUDOO\KDVDVXIILFLHQWFRQFHQWUDWLRQRIDONDOLDQGK\GUR[LGHLRQVWREHDVDWLVIDF JHQHUDOO\KDVDVXIILFLHQWFRQFHQWUDWLRQRIDONDOLDQGK\GUR[LGHLRQVWREHDVDWLVIDF
WRU\ HOHFWURO\WH +RZHYHU LI WKH FRQFUHWH GULHV RXW RU VHOIGHVLFFDWHV DQG WKH ZDWHU WRU\ HOHFWURO\WH +RZHYHU LI WKH FRQFUHWH GULHV RXW RU VHOIGHVLFFDWHV DQG WKH ZDWHU
FRQWHQWDQGGHJUHHRIVDWXUDWLRQRIWKHSRUHVDUHUHGXFHGWKHSRUHVSDFHVDUHSDUWO\ FRQWHQWDQGGHJUHHRIVDWXUDWLRQRIWKHSRUHVDUHUHGXFHGWKHSRUHVSDFHVDUHSDUWO\
HPSWLHG DQG WKH GLIILFXOW\ RI LRQ WUDQVSRUW LV FRQVHTXHQWO\ PXOWLSOLHG >1LHOVHQ  HPSWLHG DQG WKH GLIILFXOW\ RI LRQ WUDQVSRUW LV FRQVHTXHQWO\ PXOWLSOLHG >1LHOVHQ 
*HLNHU@7KLVLVWUXHHYHQWKRXJKWKHDFWXDOFRQFHQWUDWLRQRIHOHFWURO\WHLQWKH *HLNHU@7KLVLVWUXHHYHQWKRXJKWKHDFWXDOFRQFHQWUDWLRQRIHOHFWURO\WHLQWKH
UHPDLQLQJVROXWLRQPD\EHLQFUHDVHG8QGHUWKHVHUHGXFHGLRQPRELOLW\FRQGLWLRQVWKH UHPDLQLQJVROXWLRQPD\EHLQFUHDVHG8QGHUWKHVHUHGXFHGLRQPRELOLW\FRQGLWLRQVWKH
UHVLVWLYLW\LVLQFUHDVHGVXEVWDQWLDOO\ UHVLVWLYLW\LVLQFUHDVHGVXEVWDQWLDOO\
6SHFLILFLQGLFDWLRQVRIWKHHIIHFWVRIµZF¶DQGRIVDWXUDWLRQRQWKHUHVLVWLYLW\RIFRQ 6SHFLILFLQGLFDWLRQVRIWKHHIIHFWVRIµZF¶DQGRIVDWXUDWLRQRQWKHUHVLVWLYLW\RIFRQ
FUHWHVDUHSURYLGHGLQ)LJXUH>$@ FUHWHVDUHSURYLGHGLQ)LJXUH>$@

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH

 
)LJXUH >$@ (IIHFWRIZDWHUVDWXUDWLRQDQGµZF¶RQWKHUHVLVWLYLW\RIFRQFUHWH )LJXUH >$@ (IIHFWRIZDWHUVDWXUDWLRQDQGµZF¶RQWKHUHVLVWLYLW\RIFRQFUHWH
H[HPSOLILHGIRUFRQFUHWHVZLWKµZF¶UDWLRVRIDQG$IWHU>7XXWWL H[HPSOLILHGIRUFRQFUHWHVZLWKµZF¶UDWLRVRIDQG$IWHU>7XXWWL
@ >%@ (IIHFWRIFKORULGHLRQDQGPRLVWXUHFRQWHQWRQWKHUHVLVWLY @ >%@ (IIHFWRIFKORULGHLRQDQGPRLVWXUHFRQWHQWRQWKHUHVLVWLY
LW\ RI FRQFUHWH H[HPSOLILHG IRU FKORULGH FRQWHQWV RI   DQG LW\ RI FRQFUHWH H[HPSOLILHG IRU FKORULGH FRQWHQWV RI   DQG
µZZFR¶$IWHU>%HQWXUHWDO@ µZZFR¶$IWHU>%HQWXUHWDO@
)LJXUH>$@LOOXVWUDWHVWKHJUHDWVHQVLWLYLW\RIUHVLVWLYLW\WRWKHPRLVWXUHOHYHORIWKH )LJXUH>$@LOOXVWUDWHVWKHJUHDWVHQVLWLYLW\RIUHVLVWLYLW\WRWKHPRLVWXUHOHYHORIWKH
FRQFUHWH )RU LQVWDQFH IRU D FKDQJH LQ VDWXUDWLRQ IURP  WR  DQ LQFUHDVH LQ FRQFUHWH )RU LQVWDQFH IRU D FKDQJH LQ VDWXUDWLRQ IURP  WR  DQ LQFUHDVH LQ
UHVLVWLYLW\RIDERXWDQRUGHURIPDJQLWXGHRFFXUV7KHµZF¶KDVDQHIIHFWRIVLPLODU UHVLVWLYLW\RIDERXWDQRUGHURIPDJQLWXGHRFFXUV7KHµZF¶KDVDQHIIHFWRIVLPLODU
PDJQLWXGHHVSHFLDOO\DWLQWHUPHGLDWHZDWHUVDWXUDWLRQOHYHOV PDJQLWXGHHVSHFLDOO\DWLQWHUPHGLDWHZDWHUVDWXUDWLRQOHYHOV
)LJXUH  >%@ GHSLFWV WKH VSHFLILF HIIHFW RI LQFUHDVLQJ FKORULGH LRQ FRQFHQWUDWLRQ LQ )LJXUH  >%@ GHSLFWV WKH VSHFLILF HIIHFW RI LQFUHDVLQJ FKORULGH LRQ FRQFHQWUDWLRQ LQ
WKHSRUHVROXWLRQ$GGLWLRQRIFKORULGHGHFUHDVHVWKHUHVLVWLYLW\WRDFHUWDLQH[WHQWEXW WKHSRUHVROXWLRQ$GGLWLRQRIFKORULGHGHFUHDVHVWKHUHVLVWLYLW\WRDFHUWDLQH[WHQWEXW
FRQWUDU\WRWKHRSLQLRQFRPPRQO\H[SUHVVHGLQWKHOLWHUDWXUHZHFRQVLGHUWKHHIIHFWWR FRQWUDU\WRWKHRSLQLRQFRPPRQO\H[SUHVVHGLQWKHOLWHUDWXUHZHFRQVLGHUWKHHIIHFWWR
EHUDWKHUVPDOOLQFRPSDULVRQWRWKHLQIOXHQFHRIWKHPRLVWXUHFRQWHQW EHUDWKHUVPDOOLQFRPSDULVRQWRWKHLQIOXHQFHRIWKHPRLVWXUHFRQWHQW
,WFDQEHFRQFOXGHGWKDWIRUDJLYHQFRQFUHWHDQLQFUHDVHLQUHVLVWDQFHLVDQLQGLFDWLRQ ,WFDQEHFRQFOXGHGWKDWIRUDJLYHQFRQFUHWHDQLQFUHDVHLQUHVLVWDQFHLVDQLQGLFDWLRQ
RIDGHFUHDVHLQVDWXUDWLRQRUDGHFUHDVHLQFRQFUHWHSRURVLW\ RUERWK:HWKLQNWKDW RIDGHFUHDVHLQVDWXUDWLRQRUDGHFUHDVHLQFRQFUHWHSRURVLW\ RUERWK:HWKLQNWKDW
LQFUHDVLQJ WKH UHVLVWDQFH DJDLQVW LRQLF WUDQVSRUW LQ WKH YLFLQLW\ RI WKH UHEDU FDQ EH D LQFUHDVLQJ WKH UHVLVWDQFH DJDLQVW LRQLF WUDQVSRUW LQ WKH YLFLQLW\ RI WKH UHEDU FDQ EH D
PDMRUNH\LQFRQWUROOLQJUHLQIRUFHPHQWFRUURVLRQ FI&KDSWHU  PDMRUNH\LQFRQWUROOLQJUHLQIRUFHPHQWFRUURVLRQ FI&KDSWHU 

 )RUPDWLRQRI0DFURFHOOV  )RUPDWLRQRI0DFURFHOOV


0DFURFHOOFRUURVLRQUHIHUVWRDVLWXDWLRQZKHUHWKHDQRGLFDQGFDWKRGLFSURFHVVHVWDNH 0DFURFHOOFRUURVLRQUHIHUVWRDVLWXDWLRQZKHUHWKHDQRGLFDQGFDWKRGLFSURFHVVHVWDNH
SODFH RQ VHSDUDWH VLWHV RI WKH UHLQIRUFHPHQW SUHIHUHQWLDOO\ )RUPDWLRQ RI PDFURFHOOV SODFH RQ VHSDUDWH VLWHV RI WKH UHLQIRUFHPHQW SUHIHUHQWLDOO\ )RUPDWLRQ RI PDFURFHOOV
UHSUHVHQWVDSDUWLFXODUULVNEHFDXVHODUJHFDWKRGLFDUHDVFDQGULYHWKHGLVVROXWLRQLQ UHSUHVHQWVDSDUWLFXODUULVNEHFDXVHODUJHFDWKRGLFDUHDVFDQGULYHWKHGLVVROXWLRQLQ
ORFDOLVHGVPDOODQRGLFDUHDVIRUPHGLQSLWWLQJFRUURVLRQ FI6HFWLRQ ZKLOHWKH ORFDOLVHGVPDOODQRGLFDUHDVIRUPHGLQSLWWLQJFRUURVLRQ FI6HFWLRQ ZKLOHWKH
FDWKRGLFUHDFWLRQFDQWDNHSODFHRQWKHSDVVLYHFDUERQVWHHOVXUIDFH FI6HFWLRQ  FDWKRGLFUHDFWLRQFDQWDNHSODFHRQWKHSDVVLYHFDUERQVWHHOVXUIDFH FI6HFWLRQ 
$VPHQWLRQHGLQ6HFWLRQSLWWLQJFRUURVLRQLVRISDUWLFXODUFRQFHUQZLWKUHJDUGWR $VPHQWLRQHGLQ6HFWLRQSLWWLQJFRUURVLRQLVRISDUWLFXODUFRQFHUQZLWKUHJDUGWR
FKORULGHLQGXFHGFRUURVLRQDQGPDFURFHOOIRUPDWLRQLVKHQFHH[HPSOLILHGLQUHODWLRQ FKORULGHLQGXFHGFRUURVLRQDQGPDFURFHOOIRUPDWLRQLVKHQFHH[HPSOLILHGLQUHODWLRQ
WRFKORULGHLQGXFHGFRUURVLRQLQWKHVSODVK]RQH FI6HFWLRQ  WRFKORULGHLQGXFHGFRUURVLRQLQWKHVSODVK]RQH FI6HFWLRQ 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO

7ZRPRUHH[SRVXUH]RQHVFDQEHGLVWLQJXLVKHGIRUFRQFUHWHVWUXFWXUHVLQWKHPDULQH 7ZRPRUHH[SRVXUH]RQHVFDQEHGLVWLQJXLVKHGIRUFRQFUHWHVWUXFWXUHVLQWKHPDULQH
HQYLURQPHQWDFFRUGLQJWRWKHLUORFDWLRQLQUHODWLRQWRWKHVHDVXUIDFHWKHDWPRVSKHULF HQYLURQPHQWDFFRUGLQJWRWKHLUORFDWLRQLQUHODWLRQWRWKHVHDVXUIDFHWKHDWPRVSKHULF
DQG WKH VXEPHUJHG ]RQH ,Q FRUUHVSRQGHQFH ZLWK WKH VSODVK ]RQH WKH DWPRVSKHULF DQG WKH VXEPHUJHG ]RQH ,Q FRUUHVSRQGHQFH ZLWK WKH VSODVK ]RQH WKH DWPRVSKHULF
]RQHLVGHILQHGWREHORFDWHGIURPWKUHHPHWUHVDERYHWKHPD[LPXPVHDOHYHODQGWKH ]RQHLVGHILQHGWREHORFDWHGIURPWKUHHPHWUHVDERYHWKHPD[LPXPVHDOHYHODQGWKH
VXEPHUJHG ]RQH EHJLQV WKUHH PHWUHV EHORZ WKH PLQLPXP VHD OHYHO >)UHGHULNVHQ  VXEPHUJHG ]RQH EHJLQV WKUHH PHWUHV EHORZ WKH PLQLPXP VHD OHYHO >)UHGHULNVHQ 
3RXOVHQ @ ,Q WKHVH H[SRVXUH ]RQHV WKH FRQGLWLRQV FRQWUROOLQJ WKH DSSHDUDQFH 3RXOVHQ @ ,Q WKHVH H[SRVXUH ]RQHV WKH FRQGLWLRQV FRQWUROOLQJ WKH DSSHDUDQFH
DQG WKH HIIHFW RI WKH YDULRXV SRVVLEOH WUDQVSRUW PHFKDQLVPV GLVFXVVHG LQ 6HFWLRQ DQG WKH HIIHFW RI WKH YDULRXV SRVVLEOH WUDQVSRUW PHFKDQLVPV GLVFXVVHG LQ 6HFWLRQ
GLIIHUIURPFRQGLWLRQVLQWKHVSODVK]RQHDQGWKXVWKHPDJQLWXGHRIFKORULGHDQG GLIIHUIURPFRQGLWLRQVLQWKHVSODVK]RQHDQGWKXVWKHPDJQLWXGHRIFKORULGHDQG
R[\JHQLQJUHVVYDULHVODUJHO\ R[\JHQLQJUHVVYDULHVODUJHO\
7KHLRQPRELOLW\SOD\VDVLJQLILFDQWUROHLQWKHIRUPDWLRQRIPDFURFHOOV7KXVWKHH[ 7KHLRQPRELOLW\SOD\VDVLJQLILFDQWUROHLQWKHIRUPDWLRQRIPDFURFHOOV7KXVWKHH[
SRVXUH]RQHVFDQEHVXEGLYLGHGLQWRIRXUFRUURVLRQ]RQHVZLWKUHJDUGWRWKHFRQGXF SRVXUH]RQHVFDQEHVXEGLYLGHGLQWRIRXUFRUURVLRQ]RQHVZLWKUHJDUGWRWKHFRQGXF
WLYLW\RIWKHFRQFUHWH>:LONLQV 6KDUS@DVLOOXVWUDWHGLQ)LJXUH WLYLW\RIWKHFRQFUHWH>:LONLQV 6KDUS@DVLOOXVWUDWHGLQ)LJXUH

 
)LJXUH ([SRVXUHDQGFRUURVLRQ]RQHVLQPDULQHHQYLURQPHQW)URP>:LONLQV )LJXUH ([SRVXUHDQGFRUURVLRQ]RQHVLQPDULQHHQYLURQPHQW)URP>:LONLQV
6KDUS@ 6KDUS@
,QWKHVH]RQHVWKHFRQFUHWHEHFRPHVSURJUHVVLYHO\PRUHFRQGXFWLYHDVWKHGHJUHHRI ,QWKHVH]RQHVWKHFRQFUHWHEHFRPHVSURJUHVVLYHO\PRUHFRQGXFWLYHDVWKHGHJUHHRI
VDWXUDWLRQLQFUHDVHV$FFRUGLQJO\WKHFDWKRGLFDUHDWKDWLVDYDLODEOHIRUDORFDODQRGH VDWXUDWLRQLQFUHDVHV$FFRUGLQJO\WKHFDWKRGLFDUHDWKDWLVDYDLODEOHIRUDORFDODQRGH
WRIRUPDPDFURFHOOLVLQFUHDVHG7KLVLVFRXQWHUDFWHGE\WKHGHFUHDVLQJR[\JHQSHU WRIRUPDPDFURFHOOLVLQFUHDVHG7KLVLVFRXQWHUDFWHGE\WKHGHFUHDVLQJR[\JHQSHU
PHDELOLW\ZKLFKUHVWULFWVWKHFDWKRGHUHDFWLRQ PHDELOLW\ZKLFKUHVWULFWVWKHFDWKRGHUHDFWLRQ
$VLQGLFDWHGLQ)LJXUHWKHDWPRVSKHULF]RQHLVFRYHUHGE\ FRUURVLRQ]RQH ,Q $VLQGLFDWHGLQ)LJXUHWKHDWPRVSKHULF]RQHLVFRYHUHGE\ FRUURVLRQ]RQH ,Q
WKLV]RQHWKHFRQFUHWHUHVLVWDQFHLVKLJKDQGIRUPDWLRQRIPDFURFHOOVLVQRWIDYRXUHG WKLV]RQHWKHFRQFUHWHUHVLVWDQFHLVKLJKDQGIRUPDWLRQRIPDFURFHOOVLVQRWIDYRXUHG
7KHVSODVK]RQHLVVXJJHVWHGWREHGLYLGHGLQWRWZRFRUURVLRQ]RQHV,QFRUURVLRQ]RQH 7KHVSODVK]RQHLVVXJJHVWHGWREHGLYLGHGLQWRWZRFRUURVLRQ]RQHV,QFRUURVLRQ]RQH
ZKLFKFRYHUVWKHWRSRIWKHVSODVK]RQHFRUURVLRQPD\RFFXUEXWWKHSUREDELOLW\ ZKLFKFRYHUVWKHWRSRIWKHVSODVK]RQHFRUURVLRQPD\RFFXUEXWWKHSUREDELOLW\
FRPSDUHGWRFRUURVLRQ]RQHLVFRQVLGHUHGWREHVPDOO7KHPLGGOHDQGORZHUSDUWVRI FRPSDUHGWRFRUURVLRQ]RQHLVFRQVLGHUHGWREHVPDOO7KHPLGGOHDQGORZHUSDUWVRI
WKHVSODVK]RQHDUHFRQVLGHUHGWREHFRYHUHGE\FRUURVLRQ]RQH,QWKLV]RQHWKHRXW WKHVSODVK]RQHDUHFRQVLGHUHGWREHFRYHUHGE\FRUURVLRQ]RQH,QWKLV]RQHWKHRXW
HUPRVWOD\HURIWKHFRQFUHWHFRYHULVH[SRVHGWRODUJHPRLVWXUHDQGWHPSHUDWXUHYDULD HUPRVWOD\HURIWKHFRQFUHWHFRYHULVH[SRVHGWRODUJHPRLVWXUHDQGWHPSHUDWXUHYDULD

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH

WLRQV DQG FKORULGH LQLWLDWHG FRUURVLRQ LV OLNHO\ WR RFFXU 7KH FRQFUHWH FRQGXFWLYLW\ WLRQV DQG FKORULGH LQLWLDWHG FRUURVLRQ LV OLNHO\ WR RFFXU 7KH FRQFUHWH FRQGXFWLYLW\
HYHQLQJRRGTXDOLW\FRQFUHWHLVFRQVLGHUHGWREHKLJKHQRXJKWRDOORZIRUPDWLRQRI HYHQLQJRRGTXDOLW\FRQFUHWHLVFRQVLGHUHGWREHKLJKHQRXJKWRDOORZIRUPDWLRQRI
ODUJH FRUURVLRQ FHOOV UHVXOWLQJ LQ D VHYHUH FRUURVLRQ DWWDFN LQ WKLV ]RQH 7KH R[\JHQ ODUJH FRUURVLRQ FHOOV UHVXOWLQJ LQ D VHYHUH FRUURVLRQ DWWDFN LQ WKLV ]RQH 7KH R[\JHQ
GLIIXVLRQWRZDUGVWKHUHLQIRUFHPHQWFDQQRWEHH[SHFWHGWREHJUHDWO\UHVWULFWHGDVWKH GLIIXVLRQWRZDUGVWKHUHLQIRUFHPHQWFDQQRWEHH[SHFWHGWREHJUHDWO\UHVWULFWHGDVWKH
FRQFUHWH LV IUHTXHQWO\ H[SRVHG WR WKH DLU HQYLURQPHQW 7KH VXEPHUJHG ]RQH LV VDWX FRQFUHWH LV IUHTXHQWO\ H[SRVHG WR WKH DLU HQYLURQPHQW 7KH VXEPHUJHG ]RQH LV VDWX
UDWHG DQG KHQFH WKH WUDQVSRUW RI R[\JHQ WRZDUGV WKH UHLQIRUFHPHQW LV ODUJHO\ UH UDWHG DQG KHQFH WKH WUDQVSRUW RI R[\JHQ WRZDUGV WKH UHLQIRUFHPHQW LV ODUJHO\ UH
VWULFWHG (YHQ LI WKH UHLQIRUFHPHQW IDLOV WR PDLQWDLQ WKH RYHUDOO SDVVLYLW\ XQGHU WKLV VWULFWHG (YHQ LI WKH UHLQIRUFHPHQW IDLOV WR PDLQWDLQ WKH RYHUDOO SDVVLYLW\ XQGHU WKLV
FRQGLWLRQRQO\VORZXQLIRUPFRUURVLRQZLOORFFXUGXHWRWKHODFNRIR[\JHQ+RZ FRQGLWLRQRQO\VORZXQLIRUPFRUURVLRQZLOORFFXUGXHWRWKHODFNRIR[\JHQ+RZ
HYHU ODUJH PDFURFHOOV ZLWK LQWHQVH SLWWLQJ FRUURVLRQ FDQ EH GHYHORSHG LQ FUDFNV RU HYHU ODUJH PDFURFHOOV ZLWK LQWHQVH SLWWLQJ FRUURVLRQ FDQ EH GHYHORSHG LQ FUDFNV RU
VLPLODU GHIHFWV LI DUHDV RI SDVVLYH UHLQIRUFHPHQW FDQ DFW DV FDWKRGH >:LONLQV  VLPLODU GHIHFWV LI DUHDV RI SDVVLYH UHLQIRUFHPHQW FDQ DFW DV FDWKRGH >:LONLQV 
6KDUS@ 6KDUS@
7KXVPDFURFHOOIRUPDWLRQOHDGVWRDFRPSOH[FRUURVLRQPHFKDQLVPWKDWLVFRQWUROOHG 7KXVPDFURFHOOIRUPDWLRQOHDGVWRDFRPSOH[FRUURVLRQPHFKDQLVPWKDWLVFRQWUROOHG
E\WKHYDULRXVWUDQVSRUWDWLRQPHFKDQLVPVLQWRDQGZLWKLQWKHFRQFUHWHZKLFKDUHLQ E\WKHYDULRXVWUDQVSRUWDWLRQPHFKDQLVPVLQWRDQGZLWKLQWKHFRQFUHWHZKLFKDUHLQ
WHUFRQQHFWHGZLWKWKHFRQFUHWHSURSHUWLHVDQGWKHHQYLURQPHQWDOH[SRVXUHFRQGLWLRQV WHUFRQQHFWHGZLWKWKHFRQFUHWHSURSHUWLHVDQGWKHHQYLURQPHQWDOH[SRVXUHFRQGLWLRQV

 &KORULGH7KUHVKROG  &KORULGH7KUHVKROG


7KH FKORULGH WKUHVKROG FDQ EH VHHQ DV WKH KLJKHVW SRVVLEOH FKORULGH FRQFHQWUDWLRQ DW 7KH FKORULGH WKUHVKROG FDQ EH VHHQ DV WKH KLJKHVW SRVVLEOH FKORULGH FRQFHQWUDWLRQ DW
WKH FRQFUHWHVWHHO LQWHUIDFH EHIRUH FRUURVLRQ RQ WKH UHLQIRUFLQJ VWHHO LV LQLWLDWHG LH WKH FRQFUHWHVWHHO LQWHUIDFH EHIRUH FRUURVLRQ RQ WKH UHLQIRUFLQJ VWHHO LV LQLWLDWHG LH
IXOOSDVVLYLW\LVUHWDLQHG6HYHUDOUHYLHZVRQWKHFKORULGHWKUHVKROGFDQEHIRXQGLQWKH IXOOSDVVLYLW\LVUHWDLQHG6HYHUDOUHYLHZVRQWKHFKORULGHWKUHVKROGFDQEHIRXQGLQWKH
OLWHUDWXUH HJ >*ODVV  %XHQIHOG  1\JDDUG @ ,Q WHUPV RI WKH FRQFUHWH OLWHUDWXUH HJ >*ODVV  %XHQIHOG  1\JDDUG @ ,Q WHUPV RI WKH FRQFUHWH
FRYHUSURSHUWLHVWKHFKORULGHWKUHVKROGLVLQSULQFLSOHGHSHQGHQWRQWKHVDPHIDFWRUV FRYHUSURSHUWLHVWKHFKORULGHWKUHVKROGLVLQSULQFLSOHGHSHQGHQWRQWKHVDPHIDFWRUV
DVPDFURFHOOFRUURVLRQDQGIXUWKHULQWHUFRQQHFWHGZLWKPDFURFHOOFRUURVLRQLWVHOI7KH DVPDFURFHOOFRUURVLRQDQGIXUWKHULQWHUFRQQHFWHGZLWKPDFURFHOOFRUURVLRQLWVHOI7KH
LQIOXHQFH RI WKHVH IDFWRUV H[SUHVVHG DV FRQFUHWH TXDOLW\ GHJUHH RI FDUERQDWLRQ DQG LQIOXHQFH RI WKHVH IDFWRUV H[SUHVVHG DV FRQFUHWH TXDOLW\ GHJUHH RI FDUERQDWLRQ DQG
PRLVWXUHFRQWHQWFDQEHLOOXVWUDWHGDVVKRZQLQ)LJXUH PRLVWXUHFRQWHQWFDQEHLOOXVWUDWHGDVVKRZQLQ)LJXUH

 
)LJXUH 4XDOLWDWLYH GHSHQGHQFH RI FKORULGH WKUHVKROG RQ FRQFUHWH SURSHUWLHV )LJXUH 4XDOLWDWLYH GHSHQGHQFH RI FKORULGH WKUHVKROG RQ FRQFUHWH SURSHUWLHV
DQGH[SRVXUHFRQGLWLRQV$IWHU>ILE@ DQGH[SRVXUHFRQGLWLRQV$IWHU>ILE@

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO

%DVHGRQWKHGHVFULSWLRQRILQWHUUHODWHGIDFWRUVFRQWUROOLQJWKHLQJUHVVDQGLRQPRELO %DVHGRQWKHGHVFULSWLRQRILQWHUUHODWHGIDFWRUVFRQWUROOLQJWKHLQJUHVVDQGLRQPRELO
LW\LQFRQFUHWHWKHHIIHFWRIWKHIDFWRUVFRYHUHGLQ)LJXUHLVREYLRXV7KHWUDQVSRUW LW\LQFRQFUHWHWKHHIIHFWRIWKHIDFWRUVFRYHUHGLQ)LJXUHLVREYLRXV7KHWUDQVSRUW
UDWHRIR[\JHQLQFRQFUHWHLVGHSHQGHQWRQWKHPRLVWXUHFRQWHQWVLQFHR[\JHQGLIIX UDWHRIR[\JHQLQFRQFUHWHLVGHSHQGHQWRQWKHPRLVWXUHFRQWHQWVLQFHR[\JHQGLIIX
VLRQLQJDVHVLVRUGHUVRIPDJQLWXGHKLJKHUWKDQ LQDTXHRXVVROXWLRQV7KHWUDQVSRUW VLRQLQJDVHVLVRUGHUVRIPDJQLWXGHKLJKHUWKDQ LQDTXHRXVVROXWLRQV7KHWUDQVSRUW
UDWHRIR[\JHQLQFRQFUHWHGHFUHDVHVODUJHO\ZKHQWKHFDSLOODU\SRUHVDUHZDWHUILOOHG UDWHRIR[\JHQLQFRQFUHWHGHFUHDVHVODUJHO\ZKHQWKHFDSLOODU\SRUHVDUHZDWHUILOOHG
FI6HFWLRQ 2QWKHRWKHUKDQGDGU\FRQFUHWHLPSHGHVWKHHOHFWURO\WLFSURF FI6HFWLRQ 2QWKHRWKHUKDQGDGU\FRQFUHWHLPSHGHVWKHHOHFWURO\WLFSURF
HVVE\OLPLWLQJWKHSDVVDJHRILRQLFFXUUHQWWKURXJKWKHFRQFUHWH FI6HFWLRQ  HVVE\OLPLWLQJWKHSDVVDJHRILRQLFFXUUHQWWKURXJKWKHFRQFUHWH FI6HFWLRQ 
7KHUHIRUHWKHFKORULGHWKUHVKROGLVODUJHO\DIIHFWHGE\WKHH[SRVXUHFRQGLWLRQV+LJK 7KHUHIRUHWKHFKORULGHWKUHVKROGLVODUJHO\DIIHFWHGE\WKHH[SRVXUHFRQGLWLRQV+LJK
FKORULGHWKUHVKROGVDUHGHWHUPLQHGIRUVWHHOLQIXOO\VXEPHUJHGFRQFUHWHZKLOHF\FOLF FKORULGHWKUHVKROGVDUHGHWHUPLQHGIRUVWHHOLQIXOO\VXEPHUJHGFRQFUHWHZKLOHF\FOLF
ZHWWLQJDQGGU\LQJOHDGVWRORZWKUHVKROGYDOXHV>6FKLH‰O 5DXSDFK@ ZHWWLQJDQGGU\LQJOHDGVWRORZWKUHVKROGYDOXHV>6FKLH‰O 5DXSDFK@
7KHVDWXUDWLRQRIWKHFRQFUHWHLHWKHR[\JHQDYDLODELOLW\GRHVQRWRQO\FRQWUROWKH 7KHVDWXUDWLRQRIWKHFRQFUHWHLHWKHR[\JHQDYDLODELOLW\GRHVQRWRQO\FRQWUROWKH
LQJUHVV SURSHUWLHV RI RWKHU VSHFLHV DQG WKH LRQ PRELOLW\ EXW LW DOVR FRQWUROV WKH FD LQJUHVV SURSHUWLHV RI RWKHU VSHFLHV DQG WKH LRQ PRELOLW\ EXW LW DOVR FRQWUROV WKH FD
WKRGLFUHDFWLRQDQGWKXVWKHSRWHQWLDORIWKHUHLQIRUFHPHQW$VPHQWLRQHGLQ6HFWLRQ WKRGLFUHDFWLRQDQGWKXVWKHSRWHQWLDORIWKHUHLQIRUFHPHQW$VPHQWLRQHGLQ6HFWLRQ
DQGGLVFXVVHGLQPRUHGHWDLOLQ&KDSWHUFKORULGHLQGXFHGFRUURVLRQFDQEHUH DQGGLVFXVVHGLQPRUHGHWDLOLQ&KDSWHUFKORULGHLQGXFHGFRUURVLRQFDQEHUH
ODWHGWRDSLWWLQJSRWHQWLDODQGFRUURVLRQLQLWLDWLRQLVVWURQJO\GHSHQGHQWRQWKHHOHF ODWHGWRDSLWWLQJSRWHQWLDODQGFRUURVLRQLQLWLDWLRQLVVWURQJO\GHSHQGHQWRQWKHHOHF
WURGH SRWHQWLDO ,Q VRPH UHLQIRUFHPHQW FRUURVLRQ OLWHUDWXUH WKH FKORULGH WKUHVKROG LV WURGH SRWHQWLDO ,Q VRPH UHLQIRUFHPHQW FRUURVLRQ OLWHUDWXUH WKH FKORULGH WKUHVKROG LV
WKHUHIRUHGHILQHGDVWKHKLJKHVWSRVVLEOHFKORULGHFRQWHQWEHIRUHFRUURVLRQLQLWLDWLRQDW WKHUHIRUHGHILQHGDVWKHKLJKHVWSRVVLEOHFKORULGHFRQWHQWEHIRUHFRUURVLRQLQLWLDWLRQDW
DJLYHQSRWHQWLDO+RZHYHULQWKHSUHVHQWWKHVLVWKHGHILQLWLRQJLYHQLQWKHEHJLQQLQJ DJLYHQSRWHQWLDO+RZHYHULQWKHSUHVHQWWKHVLVWKHGHILQLWLRQJLYHQLQWKHEHJLQQLQJ
RI WKLV 6HFWLRQ LV SUHIHUUHG EHFDXVH WKH HOHFWURGH SRWHQWLDO LV REYLRXVO\ LQWHUFRQ RI WKLV 6HFWLRQ LV SUHIHUUHG EHFDXVH WKH HOHFWURGH SRWHQWLDO LV REYLRXVO\ LQWHUFRQ
QHFWHGZLWKDOODERYHPHQWLRQHGIDFWRUV7\SLFDOFKORULGHWKUHVKROGVIRUFDUERQVWHHO QHFWHGZLWKDOODERYHPHQWLRQHGIDFWRUV7\SLFDOFKORULGHWKUHVKROGVIRUFDUERQVWHHO
LQ XQFDUERQDWHG FRQFUHWH RI D UHDVRQDEOH TXDOLW\ DUH LQ WKH UDQJH RI  WR  LQ XQFDUERQDWHG FRQFUHWH RI D UHDVRQDEOH TXDOLW\ DUH LQ WKH UDQJH RI  WR 
µZZFH¶>ILE@FI)LJXUH$OWHUQDWLYHO\WKHFKORULGHWKUHVKROGLVLQWKHOLW µZZFH¶>ILE@FI)LJXUH$OWHUQDWLYHO\WKHFKORULGHWKUHVKROGLVLQWKHOLW
HUDWXUH VRPHWLPHV H[SUHVVHG DV &Oí2+í UDWLR DOVR UHIHUUHG WR DV +DXVPDQQ FULWH HUDWXUH VRPHWLPHV H[SUHVVHG DV &Oí2+í UDWLR DOVR UHIHUUHG WR DV +DXVPDQQ FULWH
ULRQ W\SLFDOUDWLRVDUHLQWKHUDQJHRI>+DXVPDQQ*RXGD*RXGD  ULRQ W\SLFDOUDWLRVDUHLQWKHUDQJHRI>+DXVPDQQ*RXGD*RXGD 
+DODND6DUHPL 0DKDOODWL1LHOVHQ@ +DODND6DUHPL 0DKDOODWL1LHOVHQ@

 ,QIOXHQFHRI7HPSHUDWXUH  ,QIOXHQFHRI7HPSHUDWXUH


7KH HIIHFW RI WKH WHPSHUDWXUH LV RQO\ RI PDUJLQDO LQWHUHVW LQ WKH SUHVHQW WKHVLV ,W LV 7KH HIIHFW RI WKH WHPSHUDWXUH LV RQO\ RI PDUJLQDO LQWHUHVW LQ WKH SUHVHQW WKHVLV ,W LV
PHQWLRQHGQRQHWKHOHVVEHFDXVHLWFDQKDYHDGUDVWLFHIIHFWRQFRUURVLRQLQLWLDWLRQDQG PHQWLRQHGQRQHWKHOHVVEHFDXVHLWFDQKDYHDGUDVWLFHIIHFWRQFRUURVLRQLQLWLDWLRQDQG
SURSDJDWLRQ SURSDJDWLRQ
$VLQGLFDWHGLQ6HFWLRQWKHH[SUHVVLRQIRU¨*IRUQRQVWDQGDUGVWDWHVDQGDFFRUG $VLQGLFDWHGLQ6HFWLRQWKHH[SUHVVLRQIRU¨*IRUQRQVWDQGDUGVWDWHVDQGDFFRUG
LQJO\WKH1HUQVWHTXDWLRQDUHGHSHQGHQWRQWKHWHPSHUDWXUHZKLFKLOOXVWUDWHVWKDWWKH LQJO\WKH1HUQVWHTXDWLRQDUHGHSHQGHQWRQWKHWHPSHUDWXUHZKLFKLOOXVWUDWHVWKDWWKH
WHPSHUDWXUHFRQWULEXWHVWRDOOW\SHVRIWKHUPRG\QDPLFUHDFWLRQWKDWDUHWDNHQLQWRDF WHPSHUDWXUHFRQWULEXWHVWRDOOW\SHVRIWKHUPRG\QDPLFUHDFWLRQWKDWDUHWDNHQLQWRDF
FRXQWLQWKHSUHVHQWWKHVLV,Q6HFWLRQWKHHIIHFWRIWKHWHPSHUDWXUHRQWKHUHDFWLRQ FRXQWLQWKHSUHVHQWWKHVLV,Q6HFWLRQWKHHIIHFWRIWKHWHPSHUDWXUHRQWKHUHDFWLRQ
NLQHWLFV ZDV LQGLFDWHG HJ WKH LQIOXHQFH RQ WKH H[FKDQJH FXUUHQW GHQVLWLHV DQG WKH NLQHWLFV ZDV LQGLFDWHG HJ WKH LQIOXHQFH RQ WKH H[FKDQJH FXUUHQW GHQVLWLHV DQG WKH
UHODWHGSRODULVDWLRQSKHQRPHQDWKDWZHUHDOOH[FHSWUHVLVWDQFHSRODULVDWLRQH[SUHVVHG UHODWHGSRODULVDWLRQSKHQRPHQDWKDWZHUHDOOH[FHSWUHVLVWDQFHSRODULVDWLRQH[SUHVVHG
DVDIXQFWLRQRIWKHWHPSHUDWXUH)LQDOO\LQ6HFWLRQLWZDVVKRZQWKDWWKHYH DVDIXQFWLRQRIWKHWHPSHUDWXUH)LQDOO\LQ6HFWLRQLWZDVVKRZQWKDWWKHYH
ORFLW\RIWKHLRQPRYHPHQWLVDOVRGHSHQGHQWRQWKHWHPSHUDWXUH6RDOOWKHVHIDFWRUV ORFLW\RIWKHLRQPRYHPHQWLVDOVRGHSHQGHQWRQWKHWHPSHUDWXUH6RDOOWKHVHIDFWRUV
DUHLQIOXHQFHGE\WKHWHPSHUDWXUHDQGLQSULQFLSOHLWFDQEHVDLGWKDWLQFUHDVLQJWHP DUHLQIOXHQFHGE\WKHWHPSHUDWXUHDQGLQSULQFLSOHLWFDQEHVDLGWKDWLQFUHDVLQJWHP
SHUDWXUHDFFHOHUDWHVDOOWKHUPRG\QDPLF UHDFWLRQVDOOUHDFWLRQNLQHWLFVDV ZHOODVWKH SHUDWXUHDFFHOHUDWHVDOOWKHUPRG\QDPLF UHDFWLRQVDOOUHDFWLRQNLQHWLFVDV ZHOODVWKH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH

PRYHPHQWRILRQVLQWRDQGZLWKLQWKHFRQFUHWH7KHUHVXOWRIWKLVDFFHOHUDWLRQLVWKDW PRYHPHQWRILRQVLQWRDQGZLWKLQWKHFRQFUHWH7KHUHVXOWRIWKLVDFFHOHUDWLRQLVWKDW
HYHQDPRUHRUOHVVPRGHUDWHLQFUHDVHLQWHPSHUDWXUHFDQKDYHDFRQVLGHUDEOHHIIHFW HYHQDPRUHRUOHVVPRGHUDWHLQFUHDVHLQWHPSHUDWXUHFDQKDYHDFRQVLGHUDEOHHIIHFW
IRUUHLQIRUFHPHQWFRUURVLRQZKLFKLVREYLRXVZKHQFRPSDULQJHJWKHSHUIRUPDQFH IRUUHLQIRUFHPHQWFRUURVLRQZKLFKLVREYLRXVZKHQFRPSDULQJHJWKHSHUIRUPDQFH
RI FRQFUHWH VWUXFWXUHV LQ 1RUGLF FRXQWULHV WR WKH SHUIRUPDQFH LQ WKH 0LGGOH (DVW RI FRQFUHWH VWUXFWXUHV LQ 1RUGLF FRXQWULHV WR WKH SHUIRUPDQFH LQ WKH 0LGGOH (DVW
>5RVWDP@ >5RVWDP@
)RUPRUHGHWDLOVRQWKHHIIHFWRIWKHWHPSHUDWXUHRQWKHUHLQIRUFHPHQWFRUURVLRQUHI )RUPRUHGHWDLOVRQWKHHIIHFWRIWKHWHPSHUDWXUHRQWKHUHLQIRUFHPHQWFRUURVLRQUHI
HUHQFHLVPDGHWRHJ>6FKLH‰O 5DXSDFK1LOVVRQHWDO‘VWYLN@ HUHQFHLVPDGHWRHJ>6FKLH‰O 5DXSDFK1LOVVRQHWDO‘VWYLN@

 &UDFNLQJDQG(IIHFWRI&UDFNV  &UDFNLQJDQG(IIHFWRI&UDFNV


&UDFNLQJ RI WKH FRQFUHWH FRYHU LV D PDMRU IDFWRU LQ DOWHULQJ LQJUHVV SURSHUWLHV DQG &UDFNLQJ RI WKH FRQFUHWH FRYHU LV D PDMRU IDFWRU LQ DOWHULQJ LQJUHVV SURSHUWLHV DQG
PRVW FRQFUHWH FUDFNV LQ SUDFWLFH GHVSLWH WKH EHVW HIIRUWV WR DYRLG LW >%HQW] HWDO PRVW FRQFUHWH FUDFNV LQ SUDFWLFH GHVSLWH WKH EHVW HIIRUWV WR DYRLG LW >%HQW] HWDO
@6RNQRZOHGJHRQWKHH[WHQWRIFUDFNLQJLHWKHW\SLFDOFUDFNVL]HVDVZHOODV @6RNQRZOHGJHRQWKHH[WHQWRIFUDFNLQJLHWKHW\SLFDOFUDFNVL]HVDVZHOODV
RQWKHHIIHFWRIFRQFUHWHFUDFNVRQWKHFRUURVLRQPHFKDQLVPVLVDFUXFLDOEDFNJURXQG RQWKHHIIHFWRIFRQFUHWHFUDFNVRQWKHFRUURVLRQPHFKDQLVPVLVDFUXFLDOEDFNJURXQG
FRQFHUQLQJFRUURVLRQFRXQWHUPHDVXUHV FRQFHUQLQJFRUURVLRQFRXQWHUPHDVXUHV

 ([WHQW$SSHDUDQFHDQG&DXVHVRI&UDFNLQJ  ([WHQW$SSHDUDQFHDQG&DXVHVRI&UDFNLQJ


$FFRUGLQJWR>1LOVVRQHWDO@PLFURFUDFNV PP VKRXOGEHFRQVLGHUHGDV $FFRUGLQJWR>1LOVVRQHWDO@PLFURFUDFNV PP VKRXOGEHFRQVLGHUHGDV
DQDWXUDOSDUWRIFRQFUHWHDQGWKHLUHIIHFWLVWREHLQFOXGHGZKHQSURSHUWLHVRIWKHPD DQDWXUDOSDUWRIFRQFUHWHDQGWKHLUHIIHFWLVWREHLQFOXGHGZKHQSURSHUWLHVRIWKHPD
WHULDODUHWHVWHG/DUJHUFUDFNVHJFUDFNVUHVXOWLQJIURPPHFKDQLFDOORDGLQJVKULQN WHULDODUHWHVWHG/DUJHUFUDFNVHJFUDFNVUHVXOWLQJIURPPHFKDQLFDOORDGLQJVKULQN
DJHRUWHPSHUDWXUHLQGXFHGVWUHVVHVVKRXOGEHUHJDUGHGDVGHIHFWVDQGWKHLUHIIHFWLV DJHRUWHPSHUDWXUHLQGXFHGVWUHVVHVVKRXOGEHUHJDUGHGDVGHIHFWVDQGWKHLUHIIHFWLV
WREHTXDQWLILHGVHSDUDWHO\7\SLFDOFUDFNVL]HVDQGFDXVHVFDQEHFODVVLILHGDVOLVWHG WREHTXDQWLILHGVHSDUDWHO\7\SLFDOFUDFNVL]HVDQGFDXVHVFDQEHFODVVLILHGDVOLVWHG
LQ7DEOH LQ7DEOH
7DEOH 7\SLFDOFUDFNFODVVLILFDWLRQVZLGWKVFDXVHVGHSWKVDQGGLVWDQFHV$I 7DEOH 7\SLFDOFUDFNFODVVLILFDWLRQVZLGWKVFDXVHVGHSWKVDQGGLVWDQFHV$I
WHU>1LOVVRQHWDO@ WHU>1LOVVRQHWDO@
&ODVVLILFDWLRQ 0LFURFUDFN ,QWHUPHGLDWHFUDFN 0DFURFUDFN &ODVVLILFDWLRQ 0LFURFUDFN ,QWHUPHGLDWHFUDFN 0DFURFUDFN
:LGWK PP PP !PP :LGWK PP PP !PP
&DXVH 6HOIGHVLFFDWLRQ 6KULQNDJHWHPSHUDWXUH 0HFKDQLFDOORDGLQJ &DXVH 6HOIGHVLFFDWLRQ 6KULQNDJHWHPSHUDWXUH 0HFKDQLFDOORDGLQJ
'HSWK PP PP !PP 'HSWK PP PP !PP
'LVWDQFH PP PP PP 'LVWDQFH PP PP PP
 
,Q SULQFLSOH FRQFUHWH FUDFNV DUH FDXVHG E\ HLWKHU PHFKDQLFDO ORDG RU E\ UHVWUDLQHG ,Q SULQFLSOH FRQFUHWH FUDFNV DUH FDXVHG E\ HLWKHU PHFKDQLFDO ORDG RU E\ UHVWUDLQHG
PRYHPHQWV PRYHPHQWV
/RDGLQGXFHG FUDFNLQJ FDQ RIWHQ EH UHJDUGHG DV DQ LQKHUHQW FKDUDFWHULVWLF RI UHLQ /RDGLQGXFHG FUDFNLQJ FDQ RIWHQ EH UHJDUGHG DV DQ LQKHUHQW FKDUDFWHULVWLF RI UHLQ
IRUFHGFRQFUHWHVWUXFWXUHVVLQFHWKHPD[LPXPWHQVLOHVWUDLQWKDWWKHFRQFUHWHFDQVXS IRUFHGFRQFUHWHVWUXFWXUHVVLQFHWKHPD[LPXPWHQVLOHVWUDLQWKDWWKHFRQFUHWHFDQVXS
SRUW LV RIWHQ H[FHHGHG WR XVH WKH VWHHO UHLQIRUFHPHQW HIILFLHQWO\ $FWXDOO\ GHVLJQ SRUW LV RIWHQ H[FHHGHG WR XVH WKH VWHHO UHLQIRUFHPHQW HIILFLHQWO\ $FWXDOO\ GHVLJQ
VSHFLILFDWLRQV UHTXLUH WKH FRPSOHWH HOLPLQDWLRQ RI FUDFNV RQO\ IRU VSHFLDO VWUXFWXUDO VSHFLILFDWLRQV UHTXLUH WKH FRPSOHWH HOLPLQDWLRQ RI FUDFNV RQO\ IRU VSHFLDO VWUXFWXUDO
DSSOLFDWLRQV ZKLFK LV WKHQ QRUPDOO\ DFKLHYHG E\ SUHVWUHVVHG RU SRVWWHQVLRQHG UHLQ DSSOLFDWLRQV ZKLFK LV WKHQ QRUPDOO\ DFKLHYHG E\ SUHVWUHVVHG RU SRVWWHQVLRQHG UHLQ
IRUFHGFRQFUHWH&UDFNVGXHWRPHFKDQLFDOORDGDUHRIWHQIOH[XUDOFUDFNVWKDWWHQGWR IRUFHGFRQFUHWH&UDFNVGXHWRPHFKDQLFDOORDGDUHRIWHQIOH[XUDOFUDFNVWKDWWHQGWR
EHWDSHUHGDQGWRUXQSHUSHQGLFXODUWRWKHPDLQUHLQIRUFHPHQW8QGHUODUJHGHIRUPD EHWDSHUHGDQGWRUXQSHUSHQGLFXODUWRWKHPDLQUHLQIRUFHPHQW8QGHUODUJHGHIRUPD

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO

WLRQV IOH[XUDO FUDFNV FDQ OHDG WR GHERQGLQJ DORQJ WKH FRQFUHWH VWHHOLQWHUIDFH VHH WLRQV IOH[XUDO FUDFNV FDQ OHDG WR GHERQGLQJ DORQJ WKH FRQFUHWH VWHHOLQWHUIDFH VHH
)LJXUH>$@ )LJXUH>$@

 
)LJXUH >$@ 3HUSHQGLFXODU FUDFNV DQG GHERQGLQJ DORQJ WKH UHEDU RI D EHDP )LJXUH >$@ 3HUSHQGLFXODU FUDFNV DQG GHERQGLQJ DORQJ WKH UHEDU RI D EHDP
XQGHU IOH[XUDO ORDGLQJ )URP UHVHDUFK DW '78 %\J >3HDVH HWDO XQGHU IOH[XUDO ORDGLQJ )URP UHVHDUFK DW '78 %\J >3HDVH HWDO
@ XVLQJ $5$0,6 ' GHIRUPDWLRQ DQDO\VLV >*20 @ >%@ @ XVLQJ $5$0,6 ' GHIRUPDWLRQ DQDO\VLV >*20 @ >%@
6KULQNDJHFUDFNVLQFRQFUHWHVODE)URP>)ULHGPDQQ@ 6KULQNDJHFUDFNVLQFRQFUHWHVODE)URP>)ULHGPDQQ@
5HVWUDLQWPRYHPHQWVFDXVHWHQVLOHVWUHVVHVDQGWKHFRQFUHWHFUDFNVZKHQWKHWHQVLOH 5HVWUDLQWPRYHPHQWVFDXVHWHQVLOHVWUHVVHVDQGWKHFRQFUHWHFUDFNVZKHQWKHWHQVLOH
VWUHQJWKLVH[FHHGHG5HVWUDLQWVDUHHLWKHULQWURGXFHGE\LQWHUQDOUHVWUDLQWVHJDJJUH VWUHQJWKLVH[FHHGHG5HVWUDLQWVDUHHLWKHULQWURGXFHGE\LQWHUQDOUHVWUDLQWVHJDJJUH
JDWHV DQG UHLQIRUFHPHQW RU DULVH IURP H[WHUQDO FRQVWUDLQWV HJ HDUOLHU FDVWLQJV JDWHV DQG UHLQIRUFHPHQW RU DULVH IURP H[WHUQDO FRQVWUDLQWV HJ HDUOLHU FDVWLQJV
&UDFNVGXHWRUHVWUDLQWPRYHPHQWXVXDOO\UXQWKURXJKODUJHSDUWVRIWKHFURVVVHFWLRQ &UDFNVGXHWRUHVWUDLQWPRYHPHQWXVXDOO\UXQWKURXJKODUJHSDUWVRIWKHFURVVVHFWLRQ
DQGFDQDOVRRFFXUSDUDOOHOWRWKHPDLQUHLQIRUFHPHQWVHH)LJXUH>%@&RQFUHWHLV DQGFDQDOVRRFFXUSDUDOOHOWRWKHPDLQUHLQIRUFHPHQWVHH)LJXUH>%@&RQFUHWHLV
SDUWLFXODUO\SURQHWRFUDFNLQJGXULQJWKHWUDQVLWLRQSKDVHIURPIUHVKFRQFUHWHWRKDUG SDUWLFXODUO\SURQHWRFUDFNLQJGXULQJWKHWUDQVLWLRQSKDVHIURPIUHVKFRQFUHWHWRKDUG
HQLQJ FRQFUHWH VLQFH WKLV LV D FULWLFDO SHULRG ZLWK ORZ WHQVLOH VWUHQJWK DQG ORZ GH HQLQJ FRQFUHWH VLQFH WKLV LV D FULWLFDO SHULRG ZLWK ORZ WHQVLOH VWUHQJWK DQG ORZ GH
IRUPDELOLW\ 7ZR GLVWLQFW FDXVHV IRU FUDFNLQJ SODVWLF VKULQNDJH DQG SODVWLF VHWWOH IRUPDELOLW\ 7ZR GLVWLQFW FDXVHV IRU FUDFNLQJ SODVWLF VKULQNDJH DQG SODVWLF VHWWOH
PHQWDUHRIFRQFHUQGXULQJWKLVSHULRG PHQWDUHRIFRQFHUQGXULQJWKLVSHULRG
‡ 3ODVWLFVKULQNDJHFUDFNLQJFDXVHGE\FDSLOODU\WHQVLRQLQWKHSRUHZDWHUZKHQWKH ‡ 3ODVWLFVKULQNDJHFUDFNLQJFDXVHGE\FDSLOODU\WHQVLRQLQWKHSRUHZDWHUZKHQWKH
ZDWHUORVVE\HYDSRUDWLRQH[FHHGVWKHVXSSO\RIEOHHGLQJZDWHU>ILE@ ZDWHUORVVE\HYDSRUDWLRQH[FHHGVWKHVXSSO\RIEOHHGLQJZDWHU>ILE@
‡ 3ODVWLFVHWWOHPHQWFUDFNLQJFDXVHGE\KDPSHUHGVHWWOHPHQW>ILE@ ‡ 3ODVWLFVHWWOHPHQWFUDFNLQJFDXVHGE\KDPSHUHGVHWWOHPHQW>ILE@
7KUHH PHFKDQLVPV VHOIGHVLFFDWLRQ GU\LQJ VKULQNDJH DQG WHPSHUDWXUH GLIIHUHQFHV 7KUHH PHFKDQLVPV VHOIGHVLFFDWLRQ GU\LQJ VKULQNDJH DQG WHPSHUDWXUH GLIIHUHQFHV
GRPLQDWHFUDFNLQJDIWHUWKHVHWRIFRQFUHWH GRPLQDWHFUDFNLQJDIWHUWKHVHWRIFRQFUHWH
‡ 6HOIGHVLFFDWLRQ FDXVHG E\ WKH PHQLVFL DW WKH LQWHUIDFHV EHWZHHQ WKH ZDWHUILOOHG ‡ 6HOIGHVLFFDWLRQ FDXVHG E\ WKH PHQLVFL DW WKH LQWHUIDFHV EHWZHHQ WKH ZDWHUILOOHG
DQGHPSW\SRUHV>%HQW]HWDO@ DQGHPSW\SRUHV>%HQW]HWDO@
‡ 'U\LQJVKULQNDJHFUDFNLQJE\WKHFRQWUDFWLRQRIDKDUGHQHGFRQFUHWHPL[WXUHGXH ‡ 'U\LQJVKULQNDJHFUDFNLQJE\WKHFRQWUDFWLRQRIDKDUGHQHGFRQFUHWHPL[WXUHGXH
WRWKHORVVRIFDSLOODU\ZDWHU WRWKHORVVRIFDSLOODU\ZDWHU
‡ &DUERQDWLRQVKULQNDJH FI6HFWLRQ  ‡ &DUERQDWLRQVKULQNDJH FI6HFWLRQ 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH

‡ 7KHUPDOFUDFNLQJFDXVHGE\UHVWUDLQWVWUHVVHVIURPWKHUPDOJUDGLHQWVLQSDUWLFXODU ‡ 7KHUPDOFUDFNLQJFDXVHGE\UHVWUDLQWVWUHVVHVIURPWKHUPDOJUDGLHQWVLQSDUWLFXODU
GXHWRWKHH[RWKHUPLFUHDFWLRQVGXULQJFRQFUHWHK\GUDWLRQ GXHWRWKHH[RWKHUPLFUHDFWLRQVGXULQJFRQFUHWHK\GUDWLRQ

 (IIHFWRI&UDFNLQJRQ,QJUHVVDQG5HLQIRUFHPHQW&RUURVLRQ  (IIHFWRI&UDFNLQJRQ,QJUHVVDQG5HLQIRUFHPHQW&RUURVLRQ


%DVHGRQWKHGHVFULSWLRQRIWKHH[WHQWDSSHDUDQFHDQGFDXVHVRIFUDFNLQJLQ6HFWLRQ %DVHGRQWKHGHVFULSWLRQRIWKHH[WHQWDSSHDUDQFHDQGFDXVHVRIFUDFNLQJLQ6HFWLRQ
FRQFUHWHFRYHUVPXVWJHQHUDOO\EHUHJDUGHGWRFRQWDLQFUDFNVWRDVPDOOHURU FRQFUHWHFRYHUVPXVWJHQHUDOO\EHUHJDUGHGWRFRQWDLQFUDFNVWRDVPDOOHURU
ODUJHUH[WHQW7KXVZKHQWDNLQJLQWRDFFRXQWWKHSURWHFWLYHIXQFWLRQRIWKHFRQFUHWH ODUJHUH[WHQW7KXVZKHQWDNLQJLQWRDFFRXQWWKHSURWHFWLYHIXQFWLRQRIWKHFRQFUHWH
FRYHUIRUWKHUHLQIRUFHPHQWWKHHIIHFWVRIFUDFNVLVWREHFRQVLGHUHG$VPHQWLRQHGLQ FRYHUIRUWKHUHLQIRUFHPHQWWKHHIIHFWVRIFUDFNVLVWREHFRQVLGHUHG$VPHQWLRQHGLQ
WKHLQWURGXFWLRQDOVRWKHFRUURVLRQSURFHVVLWVHOIRIWHQUHVXOWVLQFUDFNLQJRIWKHFRYHU WKHLQWURGXFWLRQDOVRWKHFRUURVLRQSURFHVVLWVHOIRIWHQUHVXOWVLQFUDFNLQJRIWKHFRYHU
ZKLFKIXUWKHUFRPSOLFDWHVWKHVLWXDWLRQ ZKLFKIXUWKHUFRPSOLFDWHVWKHVLWXDWLRQ
&UDFNVLQWKHFRQFUHWHFRYHUSUHVHQWDWOHDVWWKHIROORZLQJWKUHHHIIHFWVZLWKUHJDUGWR &UDFNVLQWKHFRQFUHWHFRYHUSUHVHQWDWOHDVWWKHIROORZLQJWKUHHHIIHFWVZLWKUHJDUGWR
UHLQIRUFHPHQWFRUURVLRQ UHLQIRUFHPHQWFRUURVLRQ
‡ ,I D FHUWDLQ ZLGWK LV H[FHHGHG FUDFNV DFW DV KLJK YHORFLW\ SDWKV DQG HQDEOH FDU ‡ ,I D FHUWDLQ ZLGWK LV H[FHHGHG FUDFNV DFW DV KLJK YHORFLW\ SDWKV DQG HQDEOH FDU
ERQDWLRQDQGFKORULGHLRQVWRUHDFKWKHUHLQIRUFLQJVWHHOLQDIUDFWLRQRIWKHWLPH ERQDWLRQDQGFKORULGHLRQVWRUHDFKWKHUHLQIRUFLQJVWHHOLQDIUDFWLRQRIWKHWLPH
FRPSDUHGWRDQXQFUDFNHGFRYHU$FFRUGLQJO\WKHGXUDWLRQRIWKHLQLWLDWLRQSKDVH FRPSDUHGWRDQXQFUDFNHGFRYHU$FFRUGLQJO\WKHGXUDWLRQRIWKHLQLWLDWLRQSKDVH
LVODUJHO\GHFUHDVHG LVODUJHO\GHFUHDVHG
‡ ,QFUHDVHGWUDQVSRUWRIR[\JHQWKURXJK FUDFNVHQDEOHVRUDFFHOHUDWHVWKH FDWKRGLF ‡ ,QFUHDVHGWUDQVSRUWRIR[\JHQWKURXJK FUDFNVHQDEOHVRUDFFHOHUDWHVWKH FDWKRGLF
UHDFWLRQVRWKDWFRUURVLRQUDWHLVLQFUHDVHGDIWHUFRUURVLRQLQLWLDWLRQ UHDFWLRQVRWKDWFRUURVLRQUDWHLVLQFUHDVHGDIWHUFRUURVLRQLQLWLDWLRQ
‡ &UDFNV SURGXFH VXEVWDQWLDO QRQXQLIRUPLWLHV LQ WKH SK\VLFDO DQG FKHPLFDO HQYL ‡ &UDFNV SURGXFH VXEVWDQWLDO QRQXQLIRUPLWLHV LQ WKH SK\VLFDO DQG FKHPLFDO HQYL
URQPHQW DURXQG WKH UHLQIRUFHPHQW 7KH QRQXQLIRUPLWLHV FDQ SURYLGH FRQGLWLRQV URQPHQW DURXQG WKH UHLQIRUFHPHQW 7KH QRQXQLIRUPLWLHV FDQ SURYLGH FRQGLWLRQV
OHDGLQJ WR WKH GHYHORSPHQW RI FRQFHQWUDWLRQ FHOOV ZKLFK FDQ HQDEOH D JDOYDQLF OHDGLQJ WR WKH GHYHORSPHQW RI FRQFHQWUDWLRQ FHOOV ZKLFK FDQ HQDEOH D JDOYDQLF
FRUURVLRQSURFHVV FRUURVLRQSURFHVV
7KHLQIOXHQFHRIFUDFNVRQWKHSHUPHDELOLW\RIFRQFUHWHZDVHYDOXDWHGE\HJ>:DQJ 7KHLQIOXHQFHRIFUDFNVRQWKHSHUPHDELOLW\RIFRQFUHWHZDVHYDOXDWHGE\HJ>:DQJ
HWDO$OGHDHWDO$OGHDHWDO@ZKLOHWKHWLPHGHSHQGHQWFRXQWHU HWDO$OGHDHWDO$OGHDHWDO@ZKLOHWKHWLPHGHSHQGHQWFRXQWHU
DFWLQJHIIHFWRIFUDFNKHDOLQJGXHWRWKHIRUPDWLRQRIFDOFLXPFDUERQDWH &D&2 WKDW DFWLQJHIIHFWRIFUDFNKHDOLQJGXHWRWKHIRUPDWLRQRIFDOFLXPFDUERQDWH &D&2 WKDW
ZDV GHWHUPLQHG WR ODUJHO\ KDPSHU WKH LQJUHVV UDWH ZDV TXDQWLILHG E\ HJ >6FKLH‰O ZDV GHWHUPLQHG WR ODUJHO\ KDPSHU WKH LQJUHVV UDWH ZDV TXDQWLILHG E\ HJ >6FKLH‰O
HWDO(GYDUGVHQ@$VLQGLFDWHGLQ6HFWLRQDQGH[SODLQHGLQPRUHGH HWDO(GYDUGVHQ@$VLQGLFDWHGLQ6HFWLRQDQGH[SODLQHGLQPRUHGH
WDLOLQ&KDSWHUWKHHIIHFWRIFKORULGHLQGXFHGFRUURVLRQLVJHQHUDOO\PXFKPRUHVH WDLOLQ&KDSWHUWKHHIIHFWRIFKORULGHLQGXFHGFRUURVLRQLVJHQHUDOO\PXFKPRUHVH
YHUH WKDQ WKH HIIHFW RI FDUERQDWLRQ LQGXFHG FRUURVLRQ 7KXV FUDFNV ZLWK DFFHVV WR YHUH WKDQ WKH HIIHFW RI FDUERQDWLRQ LQGXFHG FRUURVLRQ 7KXV FUDFNV ZLWK DFFHVV WR
FKORULGHLRQVDUHRISDUWLFXODUFRQFHUQLQGXUDELOLW\GHVLJQDQGWKH FUDFN ZLGWKLVD FKORULGHLRQVDUHRISDUWLFXODUFRQFHUQLQGXUDELOLW\GHVLJQDQGWKH FUDFN ZLGWKLVD
VLJQLILFDQWGHVLJQSDUDPHWHU$FFRUGLQJO\VHYHUDOVWXGLHVKDYHGHDOWZLWKWKHLQJUHVV VLJQLILFDQWGHVLJQSDUDPHWHU$FFRUGLQJO\VHYHUDOVWXGLHVKDYHGHDOWZLWKWKHLQJUHVV
RIFKORULGHVLQFUDFNHGFRQFUHWHHJ>3ODFH+DQVHQGH6FKXWWHU*RZUL RIFKORULGHVLQFUDFNHGFRQFUHWHHJ>3ODFH+DQVHQGH6FKXWWHU*RZUL
SDODQHWDO%RXOIL]DHWDO5RGULJXH] +RRWRQ:LQHWDO SDODQHWDO%RXOIL]DHWDO5RGULJXH] +RRWRQ:LQHWDO
.WHU HWDO D@ 7KH HIIHFW RI FUDFNV RQ WKH LQLWLDWLRQ DQG SURSDJDWLRQ RI UHLQ .WHU HWDO D@ 7KH HIIHFW RI FUDFNV RQ WKH LQLWLDWLRQ DQG SURSDJDWLRQ RI UHLQ
IRUFHPHQW FRUURVLRQ KDV EHHQ LQYHVWLJDWHG E\ VHYHUDO DXWKRUV DV ZHOO HJ >6FKLH‰O IRUFHPHQW FRUURVLRQ KDV EHHQ LQYHVWLJDWHG E\ VHYHUDO DXWKRUV DV ZHOO HJ >6FKLH‰O
5HKPHWDO5DXSDFK&66FKLH‰O 5DXSDFK@$GLV 5HKPHWDO5DXSDFK&66FKLH‰O 5DXSDFK@$GLV
FXVVLRQRIWKHVHLQYHVWLJDWLRQVJRHVEH\RQGWKHVFRSHRIWKLVWKHVLVEXWWKHUHLVDJHQ FXVVLRQRIWKHVHLQYHVWLJDWLRQVJRHVEH\RQGWKHVFRSHRIWKLVWKHVLVEXWWKHUHLVDJHQ
HUDODJUHHPHQWLQWKHOLWHUDWXUHWKDWFUDFNVH[FHHGLQJDFHUWDLQZLGWKSUHVHQWDPDMRU HUDODJUHHPHQWLQWKHOLWHUDWXUHWKDWFUDFNVH[FHHGLQJDFHUWDLQZLGWKSUHVHQWDPDMRU
ULVNHVSHFLDOO\XQGHUFKORULGHH[SRVXUH+RZHYHUWKHUHDUHGLIIHUHQWVRPHWLPHVFRQ ULVNHVSHFLDOO\XQGHUFKORULGHH[SRVXUH+RZHYHUWKHUHDUHGLIIHUHQWVRPHWLPHVFRQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO 3RUWODQG&HPHQW&RQFUHWH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO

WURYHUVLDORSLQLRQVH[SUHVVHGDERXWWKHH[DFWPDJQLWXGHRIFUDFNZLGWKWKDWOHDGVWR WURYHUVLDORSLQLRQVH[SUHVVHGDERXWWKHH[DFWPDJQLWXGHRIFUDFNZLGWKWKDWOHDGVWR
DQLQFUHDVHGFRUURVLRQULVN DQLQFUHDVHGFRUURVLRQULVN
$OWKRXJKWKHUHLVDJHQHUDODJUHHPHQWWKDWHYHQPLFURFUDFNLQJLQFUHDVHVWKHGLIIXVLRQ $OWKRXJKWKHUHLVDJHQHUDODJUHHPHQWWKDWHYHQPLFURFUDFNLQJLQFUHDVHVWKHGLIIXVLRQ
FRHIILFLHQWDQGWKXVUHGXFHVWKHLQLWLDWLRQSKDVHRIERWKFKORULGHDQGFDUERQDWLRQLQ FRHIILFLHQWDQGWKXVUHGXFHVWKHLQLWLDWLRQSKDVHRIERWKFKORULGHDQGFDUERQDWLRQLQ
GXFHGFRUURVLRQPDQ\LQYHVWLJDWLRQVKDYHVKRZQWKDWWKHUHLVQRSUHFLVHFRUUHODWLRQ GXFHGFRUURVLRQPDQ\LQYHVWLJDWLRQVKDYHVKRZQWKDWWKHUHLVQRSUHFLVHFRUUHODWLRQ
EHWZHHQWKHFUDFNZLGWKVDQGWKHULVNIRUFRUURVLRQ>*DXWHIDOO 9HQQHVODQG EHWZHHQWKHFUDFNZLGWKVDQGWKHULVNIRUFRUURVLRQ>*DXWHIDOO 9HQQHVODQG
6FKLH‰O)UDQFRLV $UOLJXLH0RKDPPHGHWDO$XGHQDHUWHWDO 6FKLH‰O)UDQFRLV $UOLJXLH0RKDPPHGHWDO$XGHQDHUWHWDO
@)RUVPDOOFUDFNZLGWKVWKHFRUURVLRQULVNGHSHQGVODUJHO\RQWKHVDPHIDFWRUV @)RUVPDOOFUDFNZLGWKVWKHFRUURVLRQULVNGHSHQGVODUJHO\RQWKHVDPHIDFWRUV
DVXQFUDFNHGFRQFUHWHLHWKHGHSWKSRURVLW\DQGWKHGHJUHHRIVDWXUDWLRQRIWKHFRQ DVXQFUDFNHGFRQFUHWHLHWKHGHSWKSRURVLW\DQGWKHGHJUHHRIVDWXUDWLRQRIWKHFRQ
FUHWHFRYHU)RUH[DPSOHLQGU\FRQFUHWH KLJKUHVLVWDQFH DVZHOODVLQVDWXUDWHGFRQ FUHWHFRYHU)RUH[DPSOHLQGU\FRQFUHWH KLJKUHVLVWDQFH DVZHOODVLQVDWXUDWHGFRQ
FUHWH ORZ R[\JHQ FRQWHQW  WKH FRUURVLRQ UDWH UHPDLQV QHJOLJLEOH HYHQ LI WKHUH DUH FUHWH ORZ R[\JHQ FRQWHQW  WKH FRUURVLRQ UDWH UHPDLQV QHJOLJLEOH HYHQ LI WKHUH DUH
FUDFNV RI D FRQVLGHUDEOH ZLGWK 7KH HQYLURQPHQWDO FRQGLWLRQV IRU HJ WKH PDULQH FUDFNV RI D FRQVLGHUDEOH ZLGWK 7KH HQYLURQPHQWDO FRQGLWLRQV IRU HJ WKH PDULQH
VSODVK ]RQH FI 6HFWLRQ   RU SDUNLQJ GHFNV IDOO EHWZHHQ WKHVH OLPLWV DQG WKH VSODVK ]RQH FI 6HFWLRQ   RU SDUNLQJ GHFNV IDOO EHWZHHQ WKHVH OLPLWV DQG WKH
HIIHFWRIFUDFNVLVWKHUHIRUHVXEVWDQWLDOLQWKHVHVWUXFWXUDOVLWXDWLRQVVRWKDWVSHFLDO HIIHFWRIFUDFNVLVWKHUHIRUHVXEVWDQWLDOLQWKHVHVWUXFWXUDOVLWXDWLRQVVRWKDWVSHFLDO
FRUURVLRQSUHYHQWLYHPHDVXUHVDUHUHTXLUHG FRUURVLRQSUHYHQWLYHPHDVXUHVDUHUHTXLUHG
)RU RWKHU VWUXFWXUDO VLWXDWLRQV OLPLWLQJ WKH R[\JHQ VXSSO\ IRU WKH FDWKRGLF UHDFWLRQ )RU RWKHU VWUXFWXUDO VLWXDWLRQV OLPLWLQJ WKH R[\JHQ VXSSO\ IRU WKH FDWKRGLF UHDFWLRQ
DQGWKHWUDQVSRUWRILRQLFFXUUHQWLQWKHFRQFUHWHEHWZHHQWKHFUDFNVLVRIWHQFRQVLG DQGWKHWUDQVSRUWRILRQLFFXUUHQWLQWKHFRQFUHWHEHWZHHQWKHFUDFNVLVRIWHQFRQVLG
HUHGWREHPRUHEHQHILFLDOIURPDFRUURVLRQSURWHFWLRQSRLQWRIYLHZWKDQOLPLWLQJWKH HUHGWREHPRUHEHQHILFLDOIURPDFRUURVLRQSURWHFWLRQSRLQWRIYLHZWKDQOLPLWLQJWKH
PD[LPXPFUDFNZLGWK)RULQVWDQFHDVLOOXVWUDWHGLQ)LJXUHLWZDVVKRZQWKDWD PD[LPXPFUDFNZLGWK)RULQVWDQFHDVLOOXVWUDWHGLQ)LJXUHLWZDVVKRZQWKDWD
GHQVH DQG WKLFN FRQFUHWH FRYHU RPLWV WKH IRUPDWLRQ RI PDFURFHOOV E\ OLPLWLQJ GLIIX GHQVH DQG WKLFN FRQFUHWH FRYHU RPLWV WKH IRUPDWLRQ RI PDFURFHOOV E\ OLPLWLQJ GLIIX
VLRQRIR[\JHQDQGPLJUDWLRQRIK\GUR[\OLRQV>6FKLH‰O 5DXSDFK@ VLRQRIR[\JHQDQGPLJUDWLRQRIK\GUR[\OLRQV>6FKLH‰O 5DXSDFK@

 
)LJXUH (IIHFW RI FRQFUHWH TXDOLW\ RQ FRUURVLRQ PHFKDQLVP IRU FUDFNV $IWHU )LJXUH (IIHFW RI FRQFUHWH TXDOLW\ RQ FRUURVLRQ PHFKDQLVP IRU FUDFNV $IWHU
>6FKLH‰O 5DXSDFK@>$@ 'HQVHFRQFUHWHOHDGLQJWRPLFURFHOO >6FKLH‰O 5DXSDFK@>$@ 'HQVHFRQFUHWHOHDGLQJWRPLFURFHOO
FRUURVLRQZLWKFDWKRGHUHDFWLRQOLPLWHGWRFUDFN>%@3RURXVFRQFUHWH FRUURVLRQZLWKFDWKRGHUHDFWLRQOLPLWHGWRFUDFN>%@3RURXVFRQFUHWH
OHDGLQJ WR PDFURFHOO FRUURVLRQ ZLWK FDWKRGH UHDFWLRQ SRVVLEOH LQ XQ OHDGLQJ WR PDFURFHOO FRUURVLRQ ZLWK FDWKRGH UHDFWLRQ SRVVLEOH LQ XQ
FUDFNHGFRQFUHWH FUDFNHGFRQFUHWH
$VVKRZQLQ)LJXUH>$@WKHFDWKRGLFUHDFWLRQFDQEHOLPLWHGWRWKHH[SRVHGVWHHO $VVKRZQLQ)LJXUH>$@WKHFDWKRGLFUHDFWLRQFDQEHOLPLWHGWRWKHH[SRVHGVWHHO
VXUIDFHLQWKHFUDFNLIWKHFRQFUHWHEHWZHHQWKHFUDFNVLVGHQVH,QFRQWUDVWDPDFUR VXUIDFHLQWKHFUDFNLIWKHFRQFUHWHEHWZHHQWKHFUDFNVLVGHQVH,QFRQWUDVWDPDFUR
FHOO ZLWK D KLJK FRUURVLRQ UDWH FDQ EH IRUPHG EHWZHHQ WKH VWHHO VXUIDFH LQ WKH XQ FHOO ZLWK D KLJK FRUURVLRQ UDWH FDQ EH IRUPHG EHWZHHQ WKH VWHHO VXUIDFH LQ WKH XQ
FUDFNHG EXW SRURXV FRQFUHWH EHWZHHQ FUDFNV ZKLFK HQDEOHV R[\JHQ GLIIXVLRQ DQG FUDFNHG EXW SRURXV FRQFUHWH EHWZHHQ FUDFNV ZKLFK HQDEOHV R[\JHQ GLIIXVLRQ DQG

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO &DUERQ6WHHO5HLQIRUFHPHQW 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO &DUERQ6WHHO5HLQIRUFHPHQW

2+íPLJUDWLRQ7KXVWKHTXDOLW\RIWKHFRQFUHWHEHWZHHQWKHFUDFNVDQGWKHWKLFNQHVV 2+íPLJUDWLRQ7KXVWKHTXDOLW\RIWKHFRQFUHWHEHWZHHQWKHFUDFNVDQGWKHWKLFNQHVV
RIFRQFUHWHFRYHUFDQSOD\DPDMRUUROHLQWKHFRUURVLRQULVNUHODWHGWRFUDFNLQJ RIFRQFUHWHFRYHUFDQSOD\DPDMRUUROHLQWKHFRUURVLRQULVNUHODWHGWRFUDFNLQJ
,WVKRXOGEHQRWHGWKDWWKLVIDFWRUKDVDPDMRULPSDFWRQVWUXFWXUDODQGGXUDELOLW\GH ,WVKRXOGEHQRWHGWKDWWKLVIDFWRUKDVDPDMRULPSDFWRQVWUXFWXUDODQGGXUDELOLW\GH
VLJQ'HVLJQLQJIRUVPDOOFUDFNZLGWKLQHYLWDEO\LQYROYHVDKLJKHUUHLQIRUFLQJGHJUHH VLJQ'HVLJQLQJIRUVPDOOFUDFNZLGWKLQHYLWDEO\LQYROYHVDKLJKHUUHLQIRUFLQJGHJUHH
ZKLFKFDQEHVLGHVHFRQRPLFDOGLVDGYDQWDJHVOHDGWRLPSURSHUFRPSDFWLRQDQGKHQFH ZKLFKFDQEHVLGHVHFRQRPLFDOGLVDGYDQWDJHVOHDGWRLPSURSHUFRPSDFWLRQDQGKHQFH
DPRUHSRURXVFRQFUHWHEHWZHHQWKHFUDFNV)XUWKHUPRUHDGHHSHUFRQFUHWHFRYHUWKDW DPRUHSRURXVFRQFUHWHEHWZHHQWKHFUDFNV)XUWKHUPRUHDGHHSHUFRQFUHWHFRYHUWKDW
OLPLWVR[\JHQGLIIXVLRQJHQHUDOO\OHDGVWRODUJHUFUDFNZLGWKV OLPLWVR[\JHQGLIIXVLRQJHQHUDOO\OHDGVWRODUJHUFUDFNZLGWKV
0D[LPXPFUDFNZLGWKVIRUGLIIHUHQWHQYLURQPHQWVDUHVSHFLILHGLQWKHQDWLRQDOEXLOG 0D[LPXPFUDFNZLGWKVIRUGLIIHUHQWHQYLURQPHQWVDUHVSHFLILHGLQWKHQDWLRQDOEXLOG
LQJ FRGHV DQG JXLGHOLQHV IRU FRQFUHWH VWUXFWXUHV LH (XURFRGH >'6(1  LQJ FRGHV DQG JXLGHOLQHV IRU FRQFUHWH VWUXFWXUHV LH (XURFRGH >'6(1 
@DQG>$&,5@,QWKHDEVHQFHRISUHVWUHVVLQJRUVSHFLILFUHTXLUHPHQWV @DQG>$&,5@,QWKHDEVHQFHRISUHVWUHVVLQJRUVSHFLILFUHTXLUHPHQWV
HJ ZDWHUWLJKWQHVV WKH QDWLRQDO FRGHV JHQHUDOO\ OLPLW WKH PD[LPXP FUDFN ZLGWK WR HJ ZDWHUWLJKWQHVV WKH QDWLRQDO FRGHV JHQHUDOO\ OLPLW WKH PD[LPXP FUDFN ZLGWK WR
PPRUXSWRPP+RZHYHUWKHDFWXDOH[SRVXUHFRQGLWLRQVDQGWKHGHVLJQVHU PPRUXSWRPP+RZHYHUWKHDFWXDOH[SRVXUHFRQGLWLRQVDQGWKHGHVLJQVHU
YLFHOLYHVRIPDQ\VSHFLDOFLYLOHQJLQHHULQJVWUXFWXUHVHJRIIVKRUHVWUXFWXUHVDQGFDU YLFHOLYHVRIPDQ\VSHFLDOFLYLOHQJLQHHULQJVWUXFWXUHVHJRIIVKRUHVWUXFWXUHVDQGFDU
SDUNV DUH JHQHUDOO\ QRW FRYHUHG E\ WKH JHQHUDO UHLQIRUFHG FRQFUHWH FRGHV DQG RIWHQ SDUNV DUH JHQHUDOO\ QRW FRYHUHG E\ WKH JHQHUDO UHLQIRUFHG FRQFUHWH FRGHV DQG RIWHQ
VSHFLDO JXLGHOLQHV DUH SURYLGHG HJ >$&, 5 @ IRU RIIVKRUH VWUXFWXUHV DQG VSHFLDO JXLGHOLQHV DUH SURYLGHG HJ >$&, 5 @ IRU RIIVKRUH VWUXFWXUHV DQG
>$&,5$&,5@IRUFDUSDUNV0RUHRYHUVSHFLDOPRGHOVIRU >$&,5$&,5@IRUFDUSDUNV0RUHRYHUVSHFLDOPRGHOVIRU
VHUYLFH OLIH GHVLJQ H[LVW 7KHVH PRGHOV DQG WKH PRVW LPSRUWDQW FRXQWHUPHDVXUHV VHUYLFH OLIH GHVLJQ H[LVW 7KHVH PRGHOV DQG WKH PRVW LPSRUWDQW FRXQWHUPHDVXUHV
ZKLFKFDQEHWDNHQWRHQVXUHWKHDWWDLQPHQWRIWKHGHVLJQVHUYLFHOLIHDUHEULHIO\GLV ZKLFKFDQEHWDNHQWRHQVXUHWKHDWWDLQPHQWRIWKHGHVLJQVHUYLFHOLIHDUHEULHIO\GLV
FXVVHGLQ&KDSWHU FXVVHGLQ&KDSWHU

 &DUERQ6WHHO5HLQIRUFHPHQW  &DUERQ6WHHO5HLQIRUFHPHQW


,QIRUPDWLRQRQWKHH[DFWPDWHULDOVSURSHUWLHVRIFDUERQVWHHOUHLQIRUFHPHQWLVVFDUFH ,QIRUPDWLRQRQWKHH[DFWPDWHULDOVSURSHUWLHVRIFDUERQVWHHOUHLQIRUFHPHQWLVVFDUFH
EXWOLWHUDWXUHRQWKHPHWDOOXUJLFDOSURSHUWLHVRIFDUERQVWHHOLVDEXQGDQW5HIHUHQFHLV EXWOLWHUDWXUHRQWKHPHWDOOXUJLFDOSURSHUWLHVRIFDUERQVWHHOLVDEXQGDQW5HIHUHQFHLV
PDGH WR WKH YDULRXV H[WHQVLYH WH[WERRNV HJ >'DYLV  %KDGHVKLD  +RQH\ PDGH WR WKH YDULRXV H[WHQVLYH WH[WERRNV HJ >'DYLV  %KDGHVKLD  +RQH\
FRPEH @ 7KH GHWDLOHG SK\VLFDO DQG PHWDOOXUJLFDO SURSHUWLHV RI FDUERQ VWHHO LQ FRPEH @ 7KH GHWDLOHG SK\VLFDO DQG PHWDOOXUJLFDO SURSHUWLHV RI FDUERQ VWHHO LQ
SDUWLFXODU FRQFHUQLQJ WKH VWUHQJWK GHYHORSPHQW DUH EH\RQG WKH VFRSH RI WKLV WKHVLV SDUWLFXODU FRQFHUQLQJ WKH VWUHQJWK GHYHORSPHQW DUH EH\RQG WKH VFRSH RI WKLV WKHVLV
*HQHUDOHOHFWURFKHPLFDOSURSHUWLHVRIFDUERQDQGVWDLQOHVVVWHHOKDYHEHHQGHDOWZLWK *HQHUDOHOHFWURFKHPLFDOSURSHUWLHVRIFDUERQDQGVWDLQOHVVVWHHOKDYHEHHQGHDOWZLWK
WKURXJKRXW&KDSWHUDQGWKHHOHFWURFKHPLVWU\RIVWHHOLQFRQFUHWHLVGLVFXVVHGLQGH WKURXJKRXW&KDSWHUDQGWKHHOHFWURFKHPLVWU\RIVWHHOLQFRQFUHWHLVGLVFXVVHGLQGH
WDLOLQ&KDSWHU WDLOLQ&KDSWHU
6SHFLILFDWLRQV DQG UHTXLUHPHQWV IRU FDUERQ VWHHO UHEDUV DUH VWDQGDUGLVHG LQ >'6(1 6SHFLILFDWLRQV DQG UHTXLUHPHQWV IRU FDUERQ VWHHO UHEDUV DUH VWDQGDUGLVHG LQ >'6(1
 @  DQG >$670 $0 @ DV ZHOO DV LQ >,62  @ IRU  @  DQG >$670 $0 @ DV ZHOO DV LQ >,62  @ IRU
VPRRWKUHEDUVDQGPRUHLPSRUWDQWO\LQ>,62@IRUULEEHGEDUV VPRRWKUHEDUVDQGPRUHLPSRUWDQWO\LQ>,62@IRUULEEHGEDUV
,Q6HFWLRQVDVKRUWRYHUYLHZLVJLYHQRIWKHSURGXFWLRQSURFHVVRIFDUERQVWHHO ,Q6HFWLRQVDVKRUWRYHUYLHZLVJLYHQRIWKHSURGXFWLRQSURFHVVRIFDUERQVWHHO
UHLQIRUFHPHQW ,Q6HFWLRQWKHPHWDOOXUJLFDODQGVXUIDFHSURSHUWLHV UHOHYDQWIRU UHLQIRUFHPHQW ,Q6HFWLRQWKHPHWDOOXUJLFDODQGVXUIDFHSURSHUWLHV UHOHYDQWIRU
FRUURVLRQDUHVXPPDULVHG FRUURVLRQDUHVXPPDULVHG

 

$FFRUGLQJWR>&,(*@WKHUHLVDVWURQJSRVVLELOLW\WKDW(1>'6(1@ZLOOEH $FFRUGLQJWR>&,(*@WKHUHLVDVWURQJSRVVLELOLW\WKDW(1>'6(1@ZLOOEH
ZLWKGUDZQIURPWKHOLVWRIUHIHUHQFHVRIKDUPRQLVHGVWDQGDUGVSXEOLVKHGLQWKH2IILFLDO-RXUQDORIWKH ZLWKGUDZQIURPWKHOLVWRIUHIHUHQFHVRIKDUPRQLVHGVWDQGDUGVSXEOLVKHGLQWKH2IILFLDO-RXUQDORIWKH
(XURSHDQ8QLRQ µ2-(8¶ EHFDXVHLWLVFRQVLGHUHGQRWWRPHHWWKHUHTXLUHPHQWVRIDKDUPRQLVHG (XURSHDQ8QLRQ µ2-(8¶ EHFDXVHLWLVFRQVLGHUHGQRWWRPHHWWKHUHTXLUHPHQWVRIDKDUPRQLVHG
VWDQGDUG VWDQGDUG

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&DUERQ6WHHO5HLQIRUFHPHQW 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO &DUERQ6WHHO5HLQIRUFHPHQW 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO

 3URGXFWLRQ3URFHVV  3URGXFWLRQ3URFHVV


8QWLOWKHPLGVQRVSHFLDOVWHHOVZHUHXVHGIRUUHLQIRUFHPHQW7KHEDUVDQGSUR 8QWLOWKHPLGVQRVSHFLDOVWHHOVZHUHXVHGIRUUHLQIRUFHPHQW7KHEDUVDQGSUR
ILOHVXVHGIRUUHLQIRUFLQJVWHHOKDGD\LHOGVWUHQJWKRIDURXQG03DDQGDVPRRWK ILOHVXVHGIRUUHLQIRUFLQJVWHHOKDGD\LHOGVWUHQJWKRIDURXQG03DDQGDVPRRWK
VXUIDFH7KHDFWLYDWLRQRIWKHEHDULQJIXQFWLRQZDVDFKLHYHGE\KRRNVDQGORRSVDWWKH VXUIDFH7KHDFWLYDWLRQRIWKHEHDULQJIXQFWLRQZDVDFKLHYHGE\KRRNVDQGORRSVDWWKH
HQGV 5XVVZXUP 6FKlIHU  HQGV 5XVVZXUP 6FKlIHU 
1RZDGD\VRUGLQDU\FDUERQUHLQIRUFLQJVWHHOVKDYHD\LHOGLQJVWUHQJWKLQWKHUDQJHRI 1RZDGD\VRUGLQDU\FDUERQUHLQIRUFLQJVWHHOVKDYHD\LHOGLQJVWUHQJWKLQWKHUDQJHRI
WR03D)URPWKHHQGRIWKHVUHLQIRUFLQJVWHHOZDVPDLQO\SURGXFHGE\ WR03D)URPWKHHQGRIWKHVUHLQIRUFLQJVWHHOZDVPDLQO\SURGXFHGE\
WKH7KHUPH[RUWKH7HPSFRUHSURFHVV>6FKRO]HWDO@%\PHDQVRIWKHVHSURF WKH7KHUPH[RUWKH7HPSFRUHSURFHVV>6FKRO]HWDO@%\PHDQVRIWKHVHSURF
HVVHVZHOGDEOHUHLQIRUFLQJVWHHOEDVHGRQDVLPSOHDQDO\VLVZLWKDFDUERQFRQWHQWRI HVVHVZHOGDEOHUHLQIRUFLQJVWHHOEDVHGRQDVLPSOHDQDO\VLVZLWKDFDUERQFRQWHQWRI
DERXW  DQG D PDQJDQHVH FRQWHQW UDQJLQJ IURP  WR  FDQ EH SURGXFHG DERXW  DQG D PDQJDQHVH FRQWHQW UDQJLQJ IURP  WR  FDQ EH SURGXFHG
>'DYLV@ >'DYLV@
1RZDGD\VUHLQIRUFLQJVWHHOLVSURGXFHGIURPRIUHF\FOHGPDWHULDOLHIHUURXV 1RZDGD\VUHLQIRUFLQJVWHHOLVSURGXFHGIURPRIUHF\FOHGPDWHULDOLHIHUURXV
VFUDSDQGDFFRUGLQJWRDQHVWLPDWHRIWKHVWHHOUHF\FOLQJLQVWLWXWH>&56,@RYHU VFUDSDQGDFFRUGLQJWRDQHVWLPDWHRIWKHVWHHOUHF\FOLQJLQVWLWXWH>&56,@RYHU
RIUHLQIRUFLQJVWHHOIURPWKHGHPROLWLRQRIUHLQIRUFHGFRQFUHWHVWUXFWXUHVLVUHF\ RIUHLQIRUFLQJVWHHOIURPWKHGHPROLWLRQRIUHLQIRUFHGFRQFUHWHVWUXFWXUHVLVUHF\
FOHGVHH)LJXUH FOHGVHH)LJXUH

 
)LJXUH 6DOYDJHVHSDUDWLRQIRUUHF\FOLQJRIUHLQIRUFHGFRQFUHWHLQ&KLFDJR,/ )LJXUH 6DOYDJHVHSDUDWLRQIRUUHF\FOLQJRIUHLQIRUFHGFRQFUHWHLQ&KLFDJR,/
86$)URP>%UDQGHQEXUJ@ 86$)URP>%UDQGHQEXUJ@
7KHUHLQIRUFHGFRQFUHWHVDOYDJHLVVHSDUDWHGIRUUHF\FOLQJ7KHUHLQIRUFHPHQWLVVROG 7KHUHLQIRUFHGFRQFUHWHVDOYDJHLVVHSDUDWHGIRUUHF\FOLQJ7KHUHLQIRUFHPHQWLVVROG
DVIHUURXVVFUDSDQGWKHFRQFUHWHLVQRUPDOO\FUXVKHGDQGXVHGHJDVURDGEDVHPDWH DVIHUURXVVFUDSDQGWKHFRQFUHWHLVQRUPDOO\FUXVKHGDQGXVHGHJDVURDGEDVHPDWH
ULDO DV D FRQFUHWH DJJUHJDWH RU HYHQ DV D UDZ PDWHULDO IRU WKH FHPHQW SURGXFWLRQ ULDO DV D FRQFUHWH DJJUHJDWH RU HYHQ DV D UDZ PDWHULDO IRU WKH FHPHQW SURGXFWLRQ
>%UDQGHQEXUJ@ >%UDQGHQEXUJ@
7RSURYLGHIRULQWHUORFNLQJEHWZHHQWKHFRQFUHWHDQGWKHVWHHOZKLFKHQDEOHVHIIHF 7RSURYLGHIRULQWHUORFNLQJEHWZHHQWKHFRQFUHWHDQGWKHVWHHOZKLFKHQDEOHVHIIHF
WLYHIRUFHWUDQVIHUEHWZHHQWKHUHLQIRUFHPHQWDQGWKHFRQFUHWHEXONULEV LQWKHOLWHUD WLYHIRUFHWUDQVIHUEHWZHHQWKHUHLQIRUFHPHQWDQGWKHFRQFUHWHEXONULEV LQWKHOLWHUD
WXUHDOVRUHIHUUHGWRDVULGJHVGHIRUPDWLRQVRUFURVVKDWFKLQJV DUHUROOHGRQWKHUH WXUHDOVRUHIHUUHGWRDVULGJHVGHIRUPDWLRQVRUFURVVKDWFKLQJV DUHUROOHGRQWKHUH
EDUV7KHVHULEVQRUPDOO\KDYHDPD[LPDOKHLJKWRIDQGDPD[LPDOGLVWDQFHRI EDUV7KHVHULEVQRUPDOO\KDYHDPD[LPDOKHLJKWRIDQGDPD[LPDOGLVWDQFHRI
LQUHODWLRQWRWKHGLDPHWHURIWKHUHLQIRUFLQJ>6FKRO]HWDO@ LQUHODWLRQWRWKHGLDPHWHURIWKHUHLQIRUFLQJ>6FKRO]HWDO@

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO &DUERQ6WHHO5HLQIRUFHPHQW 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO &DUERQ6WHHO5HLQIRUFHPHQW

 0HWDOOXUJLFDODQG6XUIDFH3URSHUWLHV  0HWDOOXUJLFDODQG6XUIDFH3URSHUWLHV


$FFRUGLQJWR>%DUGDO@ DPHWDOLVXVXDOO\PRVWFRUURVLRQUHVLVWDQWZKHQLWFRQ $FFRUGLQJWR>%DUGDO@ DPHWDOLVXVXDOO\PRVWFRUURVLRQUHVLVWDQWZKHQLWFRQ
WDLQVWKHVPDOOHVWSRVVLEOHDPRXQWVRILPSXULWLHV,QWKLV6HFWLRQWKLVQRWLRQLVUHODWHG WDLQVWKHVPDOOHVWSRVVLEOHDPRXQWVRILPSXULWLHV,QWKLV6HFWLRQWKLVQRWLRQLVUHODWHG
WRPHWDOOXUJLFDODQGVXUIDFHSURSHUWLHVRIFDUERQVWHHOUHLQIRUFHPHQW7KHWKHRUHWLFDO WRPHWDOOXUJLFDODQGVXUIDFHSURSHUWLHVRIFDUERQVWHHOUHLQIRUFHPHQW7KHWKHRUHWLFDO
EDFNJURXQGLVEULHIO\GHVFULEHGLQ6HFWLRQ5HVXOWVIURPRZQLQYHVWLJDWLRQVRQ EDFNJURXQGLVEULHIO\GHVFULEHGLQ6HFWLRQ5HVXOWVIURPRZQLQYHVWLJDWLRQVRQ
WKHPHWDOOXUJLFDODQGVXUIDFHSURSHUWLHVRIDVUHFHLYHGFDUERQVWHHOUHEDUDUHVXPPD WKHPHWDOOXUJLFDODQGVXUIDFHSURSHUWLHVRIDVUHFHLYHGFDUERQVWHHOUHEDUDUHVXPPD
ULVHGLQ6HFWLRQ ULVHGLQ6HFWLRQ

 7KHRU\  7KHRU\


$QRGLF DQG FDWKRGLF VLWHV FI 6HFWLRQ   DUH FUHDWHG RQ WKH FDUERQ VWHHO VXUIDFH $QRGLF DQG FDWKRGLF VLWHV FI 6HFWLRQ   DUH FUHDWHG RQ WKH FDUERQ VWHHO VXUIDFH
GXHWRFRPSRVLWLRQDOYDULDWLRQVIURPRQHVLWHWRDQRWKHURUGXHWRFHUWDLQYDULDWLRQVLQ GXHWRFRPSRVLWLRQDOYDULDWLRQVIURPRQHVLWHWRDQRWKHURUGXHWRFHUWDLQYDULDWLRQVLQ
WKHFRQFUHWHVWHHOLQWHUIDFH FI6HFWLRQ 6XFKGLIIHUHQFHVFDXVHVRPHVLWHVWREH WKHFRQFUHWHVWHHOLQWHUIDFH FI6HFWLRQ 6XFKGLIIHUHQFHVFDXVHVRPHVLWHVWREH
PRUHHOHFWURFKHPLFDOO\DFWLYHWKDQRWKHUVDQGFUHDWHSRWHQWLDOJUDGLHQWV$FWLYHVLWHV PRUHHOHFWURFKHPLFDOO\DFWLYHWKDQRWKHUVDQGFUHDWHSRWHQWLDOJUDGLHQWV$FWLYHVLWHV
EHFRPHDQRGHVZKHUHDVOHVVDFWLYHVLWHVWHQGWRDFWDVFDWKRGHV EHFRPHDQRGHVZKHUHDVOHVVDFWLYHVLWHVWHQGWRDFWDVFDWKRGHV
&DUERQVWHHOLVKHWHURJHQHRXVRQDPLFURVFRSLFVFDOH7ZRGLIIHUHQWW\SHVRISKDVHV &DUERQVWHHOLVKHWHURJHQHRXVRQDPLFURVFRSLFVFDOH7ZRGLIIHUHQWW\SHVRISKDVHV
WKHĮ)HSKDVHUHIHUUHGWRDVIHUULWHDQGDQLURQFDUELGHFRPSRXQG )H& UHIHUUHG WKHĮ)HSKDVHUHIHUUHGWRDVIHUULWHDQGDQLURQFDUELGHFRPSRXQG )H& UHIHUUHG
WRDVFHPHQWLWHDUHJHQHUDOO\WDNHQLQWRDFFRXQWZKHQFRUURVLRQSURSHUWLHVDUHGHDOW WRDVFHPHQWLWHDUHJHQHUDOO\WDNHQLQWRDFFRXQWZKHQFRUURVLRQSURSHUWLHVDUHGHDOW
ZLWK 7KH IHUULWH SKDVH WHQGV WR GHYHORS D PRUH DFWLYH SRWHQWLDO WKDQ WKH FHPHQWLWH ZLWK 7KH IHUULWH SKDVH WHQGV WR GHYHORS D PRUH DFWLYH SRWHQWLDO WKDQ WKH FHPHQWLWH
SKDVH+RZHYHUSRWHQWLDOJUDGLHQWVFDQDOVRGHYHORSLQDUHDVRIXQLIRUPFRPSRVLWLRQ SKDVH+RZHYHUSRWHQWLDOJUDGLHQWVFDQDOVRGHYHORSLQDUHDVRIXQLIRUPFRPSRVLWLRQ
VLQFH WKH DWRPV DW RU QHDU WKH JUDLQ ERXQGDULHV WHQG WR EH VLJQLILFDQWO\ PRUH DFWLYH VLQFH WKH DWRPV DW RU QHDU WKH JUDLQ ERXQGDULHV WHQG WR EH VLJQLILFDQWO\ PRUH DFWLYH
WKDQWKHDWRPVZLWKLQWKHEXONRIWKHJUDLQVDQGWKXVWKHJUDLQERXQGDU\UHJLRQVWHQG WKDQWKHDWRPVZLWKLQWKHEXONRIWKHJUDLQVDQGWKXVWKHJUDLQERXQGDU\UHJLRQVWHQG
WREHDQRGLF7KHUHIRUHWKHUHLQIRUFLQJVWHHOVXUIDFHFDQEHFRQVLGHUHGWRFRQVLVWRI WREHDQRGLF7KHUHIRUHWKHUHLQIRUFLQJVWHHOVXUIDFHFDQEHFRQVLGHUHGWRFRQVLVWRI
FOXVWHUVRIQXPHURXVORFDOFRUURVLRQFHOOV,IWKHFRQFUHWHLVGU\LRQLFFKDUJHWUDQVIHU FOXVWHUVRIQXPHURXVORFDOFRUURVLRQFHOOV,IWKHFRQFUHWHLVGU\LRQLFFKDUJHWUDQVIHU
LVFHDVHG FI6HFWLRQ DQGWKHFRUURVLRQUHDFWLRQFDQQRWWDNHSODFH+RZHYHU LVFHDVHG FI6HFWLRQ DQGWKHFRUURVLRQUHDFWLRQFDQQRWWDNHSODFH+RZHYHU
LIWKHVXUIDFHKDVDFFHVVWRDQLRQLFVROXWLRQLHWKHSRUHVROXWLRQFXUUHQWVFDQIORZ LIWKHVXUIDFHKDVDFFHVVWRDQLRQLFVROXWLRQLHWKHSRUHVROXWLRQFXUUHQWVFDQIORZ
DQGWKHFRUURVLRQUHDFWLRQVEHWZHHQWKHORFDOFHOOVFDQRFFXU>%HQWXUHWDO@ DQGWKHFRUURVLRQUHDFWLRQVEHWZHHQWKHORFDOFHOOVFDQRFFXU>%HQWXUHWDO@
2Q D ODUJHU VFDOH VWUHVVHV LQGXFHG E\ FROG ZRUNLQJ FDQ OHDG WR FRQVLGHUDEOH LQKR 2Q D ODUJHU VFDOH VWUHVVHV LQGXFHG E\ FROG ZRUNLQJ FDQ OHDG WR FRQVLGHUDEOH LQKR
PRJHQHLWLHV 7KH PHWDO LQ WKH VWUDLQHG ]RQHV LV PRUH DFWLYH DQG WHQGV WR EHKDYH PRJHQHLWLHV 7KH PHWDO LQ WKH VWUDLQHG ]RQHV LV PRUH DFWLYH DQG WHQGV WR EHKDYH
DQRGLFDOO\ZKHUHDVWKHXQVWUDLQHGPHWDOWHQGVWRIXQFWLRQDVFDWKRGH>%HQWXUHWDO DQRGLFDOO\ZKHUHDVWKHXQVWUDLQHGPHWDOWHQGVWRIXQFWLRQDVFDWKRGH>%HQWXUHWDO
@ @
:HDVVXPHWKDWHVSHFLDOO\UROOLQJRIULEVSURGXFHVPDMRUVWUHVVFRQFHQWUDWLRQVOHDGLQJ :HDVVXPHWKDWHVSHFLDOO\UROOLQJRIULEVSURGXFHVPDMRUVWUHVVFRQFHQWUDWLRQVOHDGLQJ
WRFRQVLGHUDEOHSRWHQWLDOJUDGLHQWV)XUWKHUPRUHZHWKLQNWKDWRWKHUYDULDWLRQVLQWKH WRFRQVLGHUDEOHSRWHQWLDOJUDGLHQWV)XUWKHUPRUHZHWKLQNWKDWRWKHUYDULDWLRQVLQWKH
VXUIDFHFRQGLWLRQVHJFDXVHGE\R[LGHVRULQFOXVLRQVRIRWKHUVSHFLHVKDYHDPDMRU VXUIDFHFRQGLWLRQVHJFDXVHGE\R[LGHVRULQFOXVLRQVRIRWKHUVSHFLHVKDYHDPDMRU
HIIHFW RQ IRUPDWLRQ RI FRUURVLRQ FHOOV RQ WKH VWHHO VXUIDFH ZKLFK DSSHDUV QRW WR EH HIIHFW RQ IRUPDWLRQ RI FRUURVLRQ FHOOV RQ WKH VWHHO VXUIDFH ZKLFK DSSHDUV QRW WR EH
WDNHQLQWRPXFKFRQVLGHUDWLRQLQWKHOLWHUDWXUH7KHUHIRUHZHKDYHDQDO\VHGWKHVXU WDNHQLQWRPXFKFRQVLGHUDWLRQLQWKHOLWHUDWXUH7KHUHIRUHZHKDYHDQDO\VHGWKHVXU
IDFH DQG PHWDOOXUJLFDO SURSHUWLHV RI DVUHFHLYHG FDUERQ VWHHO 7KLV LQYHVWLJDWLRQ ZDV IDFH DQG PHWDOOXUJLFDO SURSHUWLHV RI DVUHFHLYHG FDUERQ VWHHO 7KLV LQYHVWLJDWLRQ ZDV
DOVR RI LPSRUWDQFH ZLWK UHJDUG WR WKH SURSRVHG QHZ FRXQWHUPHDVXUHV EHFDXVH RQH DOVR RI LPSRUWDQFH ZLWK UHJDUG WR WKH SURSRVHG QHZ FRXQWHUPHDVXUHV EHFDXVH RQH
SULQFLSOHIRUWKHLPSOHPHQWDWLRQLVEDVHGRQFRQFUHWHVWHHOLQWHUIDFHPRGLILFDWLRQ FI SULQFLSOHIRUWKHLPSOHPHQWDWLRQLVEDVHGRQFRQFUHWHVWHHOLQWHUIDFHPRGLILFDWLRQ FI
6HFWLRQ   6HOHFWHG UHVXOWV IURP WKH LQYHVWLJDWLRQ DUH JLYHQ LQ 6HFWLRQ  6HFWLRQ   6HOHFWHG UHVXOWV IURP WKH LQYHVWLJDWLRQ DUH JLYHQ LQ 6HFWLRQ 
ZKLOHUHVXOWVIURPDFRPSDUDWLYHDQDO\VLVSHUIRUPHGIRUVWDLQOHVVVWHHOUHLQIRUFHPHQW ZKLOHUHVXOWVIURPDFRPSDUDWLYHDQDO\VLVSHUIRUPHGIRUVWDLQOHVVVWHHOUHLQIRUFHPHQW

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&DUERQ6WHHO5HLQIRUFHPHQW 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO &DUERQ6WHHO5HLQIRUFHPHQW 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO

DUH VXPPDULVHG LQ 6HFWLRQ  7KH SUDFWLFDO UHOHYDQFH RI VXFK DQDO\VHV ZLWK DUH VXPPDULVHG LQ 6HFWLRQ  7KH SUDFWLFDO UHOHYDQFH RI VXFK DQDO\VHV ZLWK
UHJDUGWRVXUIDFHPRGLILFDWLRQVRIFDUERQVWHHOLVH[HPSOLILHGE\WKHLQIOXHQFHRIVLOL UHJDUGWRVXUIDFHPRGLILFDWLRQVRIFDUERQVWHHOLVH[HPSOLILHGE\WKHLQIOXHQFHRIVLOL
FRQRQWKHTXDOLW\RIKRWGLSJDOYDQLVDWLRQLQ6HFWLRQ FRQRQWKHTXDOLW\RIKRWGLSJDOYDQLVDWLRQLQ6HFWLRQ

 ([SHULPHQWDO,QYHVWLJDWLRQV  ([SHULPHQWDO,QYHVWLJDWLRQV


$VUHFHLYHGULEEHGFDUERQVWHHOUHEDU.76>/0*D@LH%$5$&>'6 $VUHFHLYHGULEEHGFDUERQVWHHOUHEDU.76>/0*D@LH%$5$&>'6
@ FI6HFWLRQ ZDVLQYHVWLJDWHGEDVHGRQOLJKWRSWLFDOPLFURVFRS\ @ FI6HFWLRQ ZDVLQYHVWLJDWHGEDVHGRQOLJKWRSWLFDOPLFURVFRS\
µ/20¶VFDQQLQJHOHFWURQPLFURVFRS\µ6(0¶DQGHQHUJ\GLVSHUVLYH;UD\VSHFWURV µ/20¶VFDQQLQJHOHFWURQPLFURVFRS\µ6(0¶DQGHQHUJ\GLVSHUVLYH;UD\VSHFWURV
FRS\µ('6¶6HOHFWHGUHVXOWVDUHVXPPDULVHGDIWHUDVKRUWQRWHRQWKHVDPSOHSUHSDUD FRS\µ('6¶6HOHFWHGUHVXOWVDUHVXPPDULVHGDIWHUDVKRUWQRWHRQWKHVDPSOHSUHSDUD
WLRQDQGPHDVXUHPHQWWHFKQLTXHV WLRQDQGPHDVXUHPHQWWHFKQLTXHV

 6DPSOH3UHSDUDWLRQDQG0HDVXUHPHQW7HFKQLTXHV  6DPSOH3UHSDUDWLRQDQG0HDVXUHPHQW7HFKQLTXHV


7KHPHWDOORJUDSKLFVDPSOHFRQWDLQLQJFURVVDQGORQJLWXGLQDOVHFWLRQVRIDVUHFHLYHG 7KHPHWDOORJUDSKLFVDPSOHFRQWDLQLQJFURVVDQGORQJLWXGLQDOVHFWLRQVRIDVUHFHLYHG
ULEEHGVWDLQOHVVVWHHOUHEDUZLWKDGLDPHWHURIPPZDVSUHSDUHGE\PHDQVRIDVXLW ULEEHGVWDLQOHVVVWHHOUHEDUZLWKDGLDPHWHURIPPZDVSUHSDUHGE\PHDQVRIDVXLW
DEOHJULQGLQJDQGSROLVKLQJVHTXHQFHDFFRUGLQJWR>%MHUUHJDDUGHWDO@µ/20¶ DEOHJULQGLQJDQGSROLVKLQJVHTXHQFHDFFRUGLQJWR>%MHUUHJDDUGHWDO@µ/20¶
ZDVSHUIRUPHGRQWKHVSHFLPHQEHIRUHDQGDIWHUHWFKLQJZLWKQLWDODVGHVFULEHGLQ ZDVSHUIRUPHGRQWKHVSHFLPHQEHIRUHDQGDIWHUHWFKLQJZLWKQLWDODVGHVFULEHGLQ
>:HLGPDQQ  *XHVQLHU @ %HVLGHV µ/20¶ WKH PHWDOOXUJLFDO SURSHUWLHV RI WKH >:HLGPDQQ  *XHVQLHU @ %HVLGHV µ/20¶ WKH PHWDOOXUJLFDO SURSHUWLHV RI WKH
VSHFLPHQKDYHEHHQLQYHVWLJDWHGE\ µ6(0¶DQG µ('6¶DFFRUGLQJWR>$670( VSHFLPHQKDYHEHHQLQYHVWLJDWHGE\ µ6(0¶DQG µ('6¶DFFRUGLQJWR>$670(
@ DQG >$670 ( @ UHVSHFWLYHO\ %HIRUH µ6(0¶ DQG µ('6¶ DQDO\VHV D @ DQG >$670 ( @ UHVSHFWLYHO\ %HIRUH µ6(0¶ DQG µ('6¶ DQDO\VHV D
FRQGXFWLQJ WKLQ ILOP RI FDUERQ ZDV DSSOLHG RQ WKH VXUIDFH RI WKH PHWDOORJUDSKLF FRQGXFWLQJ WKLQ ILOP RI FDUERQ ZDV DSSOLHG RQ WKH VXUIDFH RI WKH PHWDOORJUDSKLF
VSHFLPHQ VSHFLPHQ

 /LJKW2SWLFDO0LFURVFRS\  /LJKW2SWLFDO0LFURVFRS\


3KRWRJUDSKV IURP ORZ PDJQLILFDWLRQ µ/20¶ RI WKH FURVV DQG ORQJLWXGLQDO VHFWLRQ 3KRWRJUDSKV IURP ORZ PDJQLILFDWLRQ µ/20¶ RI WKH FURVV DQG ORQJLWXGLQDO VHFWLRQ
IURP WKH HWFKHG FDUERQ VWHHO VDPSOH DUH VKRZQ LQ )LJXUH  >$@ DQG >%@ UHVSHF IURP WKH HWFKHG FDUERQ VWHHO VDPSOH DUH VKRZQ LQ )LJXUH  >$@ DQG >%@ UHVSHF
WLYHO\7KHOLJKWHULQVLGHZLWKDQHYHQOLJKWHUULQJLVDSSDUHQWLQERWKSKRWRV:HDV WLYHO\7KHOLJKWHULQVLGHZLWKDQHYHQOLJKWHUULQJLVDSSDUHQWLQERWKSKRWRV:HDV
VXPH WKDW WKLV DSSHDUDQFH UHVXOWV IURP WKH KDUGHQLQJ DQG WKH KRWUROOLQJ SURFHVV VXPH WKDW WKLV DSSHDUDQFH UHVXOWV IURP WKH KDUGHQLQJ DQG WKH KRWUROOLQJ SURFHVV
&RROLQJIURPWKHRXWVLGHGXULQJKDUGHQLQJPLJKWSXVKFHUWDLQDOOR\LQJHOHPHQWVWKDW &RROLQJIURPWKHRXWVLGHGXULQJKDUGHQLQJPLJKWSXVKFHUWDLQDOOR\LQJHOHPHQWVWKDW
VROLGLI\ODWHUWRZDUGVWKHFHQWUHDQGWKHUHIRUHOHDGWRGHFLVLYHGLIIHUHQFHVLQWKHFRP VROLGLI\ODWHUWRZDUGVWKHFHQWUHDQGWKHUHIRUHOHDGWRGHFLVLYHGLIIHUHQFHVLQWKHFRP
SRVLWLRQ SRVLWLRQ

 
)LJXUH /RZUHVROXWLRQOLJKWRSWLFDOPLFURVFRS\RIHWFKHGFDUERQVWHHOVDPSOH )LJXUH /RZUHVROXWLRQOLJKWRSWLFDOPLFURVFRS\RIHWFKHGFDUERQVWHHOVDPSOH
>$@&URVVVHFWLRQ>%@/RQJLWXGLQDOVHFWLRQ >$@&URVVVHFWLRQ>%@/RQJLWXGLQDOVHFWLRQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO &DUERQ6WHHO5HLQIRUFHPHQW 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO &DUERQ6WHHO5HLQIRUFHPHQW

)LJXUH>$@DQG>%@VKRZSKRWRVIURPWKHµ/20¶EHIRUHHWFKLQJRIWKHFURVVDQG )LJXUH>$@DQG>%@VKRZSKRWRVIURPWKHµ/20¶EHIRUHHWFKLQJRIWKHFURVVDQG
WKHORQJLWXGLQDOVHFWLRQUHVSHFWLYHO\'RWWHGLQFOXVLRQVFDQEHLGHQWLILHGLQWKHFURVV WKHORQJLWXGLQDOVHFWLRQUHVSHFWLYHO\'RWWHGLQFOXVLRQVFDQEHLGHQWLILHGLQWKHFURVV
VHFWLRQZKHUHDVWKHLQFOXVLRQVLQWKHORQJLWXGLQDOVHFWLRQVDUH³VWUHWFKHG´GXHWRWKH VHFWLRQZKHUHDVWKHLQFOXVLRQVLQWKHORQJLWXGLQDOVHFWLRQVDUH³VWUHWFKHG´GXHWRWKH
UROOLQJSURFHVV:HWKLQNWKDWWKHVHLQFOXVLRQVFRQVLVWRIR[LGHVHJ)H2RU6L2 UROOLQJSURFHVV:HWKLQNWKDWWKHVHLQFOXVLRQVFRQVLVWRIR[LGHVHJ)H2RU6L2
VXOSKDWHVRUVXOSKLWHV FI6HFWLRQ  VXOSKDWHVRUVXOSKLWHV FI6HFWLRQ 

 
)LJXUH /LJKWRSWLFDOPLFURVFRS\RIXQHWFKHGFDUERQVWHHOVDPSOH>$@ &URVV )LJXUH /LJKWRSWLFDOPLFURVFRS\RIXQHWFKHGFDUERQVWHHOVDPSOH>$@ &URVV
VHFWLRQ>%@/RQJLWXGLQDOVHFWLRQ VHFWLRQ>%@/RQJLWXGLQDOVHFWLRQ
6HOHFWHG SKRWRJUDSKV IURP KLJK PDJQLILFDWLRQ µ/20¶ RQ WKH HWFKHG FDUERQ VWHHO 6HOHFWHG SKRWRJUDSKV IURP KLJK PDJQLILFDWLRQ µ/20¶ RQ WKH HWFKHG FDUERQ VWHHO
VDPSOHDUHSUHVHQWHGLQ)LJXUH$OOSKRWRVZHUHWDNHQDORQJWKHHGJHRIWKHORQ VDPSOHDUHSUHVHQWHGLQ)LJXUH$OOSKRWRVZHUHWDNHQDORQJWKHHGJHRIWKHORQ
JLWXGLQDOVHFWLRQ JLWXGLQDOVHFWLRQ

 
)LJXUH +LJKPDJQLILFDWLRQOLJKWRSWLFDOPLFURVFRS\RIORQJLWXGLQDOVHFWLRQRI )LJXUH +LJKPDJQLILFDWLRQOLJKWRSWLFDOPLFURVFRS\RIORQJLWXGLQDOVHFWLRQRI
HWFKHGFDUERQVWHHOVDPSOH HWFKHGFDUERQVWHHOVDPSOH
%HVLGHVWKHFOHDUO\YLVLEOHPLFURVWUXFWXUHDOOSKRWRVH[KLELWVXUIDFHGHIHFWVDQGLQFOX %HVLGHVWKHFOHDUO\YLVLEOHPLFURVWUXFWXUHDOOSKRWRVH[KLELWVXUIDFHGHIHFWVDQGLQFOX
VLRQV)LJXUH>$@VKRZVDVXUIDFHFUDFNWKDWPLJKWUHVXOWIURPRYHUUROOLQJ:H VLRQV)LJXUH>$@VKRZVDVXUIDFHFUDFNWKDWPLJKWUHVXOWIURPRYHUUROOLQJ:H
DVVXPHWKDWFRUURVLRQLVOLNHO\WREHLQLWLDWHGLQVXFKDFUDFNLQSDUWLFXODUZLWKUHJDUG DVVXPHWKDWFRUURVLRQLVOLNHO\WREHLQLWLDWHGLQVXFKDFUDFNLQSDUWLFXODUZLWKUHJDUG
WRWKHPHFKDQLVPVGHVFULEHGIRUFUHYLFHFRUURVLRQ FI6HFWLRQ )LJXUH>%@ WRWKHPHFKDQLVPVGHVFULEHGIRUFUHYLFHFRUURVLRQ FI6HFWLRQ )LJXUH>%@
>&@DQG>'@VKRZORFDWLRQVZKHUHFRUURVLRQSURGXFWVZHUHIRUPHG:KLOHWKHSURG >&@DQG>'@VKRZORFDWLRQVZKHUHFRUURVLRQSURGXFWVZHUHIRUPHG:KLOHWKHSURG
XFWVLQ)LJXUH>%@ZHUHIRXQGDWWKHVXUIDFH)LJXUH>&@DQG>'@UHSUHVHQW XFWVLQ)LJXUH>%@ZHUHIRXQGDWWKHVXUIDFH)LJXUH>&@DQG>'@UHSUHVHQW

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&DUERQ6WHHO5HLQIRUFHPHQW 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO &DUERQ6WHHO5HLQIRUFHPHQW 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO

ORFDWLRQV ZKHUH WKH FRUURVLRQ SURGXFWV ZHUH UROOHG LQWR WKH EXON :H VXJJHVW WKDW ORFDWLRQV ZKHUH WKH FRUURVLRQ SURGXFWV ZHUH UROOHG LQWR WKH EXON :H VXJJHVW WKDW
VXFKVFDOHUROOHGRQDQGLQWRWKHVXUIDFHLQWHUDFWVYHU\SUHFLRXVDQGHOHFWURFKHPLFDOO\ VXFKVFDOHUROOHGRQDQGLQWRWKHVXUIDFHLQWHUDFWVYHU\SUHFLRXVDQGHOHFWURFKHPLFDOO\
DFWLYHWRHQGRUVHUHJLRQVIRUFRUURVLRQLQLWLDWLRQ DFWLYHWRHQGRUVHUHJLRQVIRUFRUURVLRQLQLWLDWLRQ

 6FDQQLQJ(OHFWURQ0LFURVFRS\  6FDQQLQJ(OHFWURQ0LFURVFRS\


)LJXUHVKRZVVHFRQGDU\HOHFWURQ >$@DQG>&@ DQGEDFNVFDWWHUHG >%@DQG>'@  )LJXUHVKRZVVHFRQGDU\HOHFWURQ >$@DQG>&@ DQGEDFNVFDWWHUHG >%@DQG>'@ 
µ6(0¶SKRWRJUDSKVIURPWKHHGJHRIWKHHWFKHGFURVVVHFWLRQRIWKHFDUERQVWHHOVDP µ6(0¶SKRWRJUDSKVIURPWKHHGJHRIWKHHWFKHGFURVVVHFWLRQRIWKHFDUERQVWHHOVDP
SOH7KHSUHYLRXVO\GLVFXVVHGUROOHGLQFRUURVLRQSURGXFWVDUHFOHDUO\YLVLEOHDVEODFN SOH7KHSUHYLRXVO\GLVFXVVHGUROOHGLQFRUURVLRQSURGXFWVDUHFOHDUO\YLVLEOHDVEODFN
LQFOXVLRQV LQ WKH EXON RI WKH EDFNVFDWWHUHG µ6(0¶ SKRWR LQ )LJXUH  >%@ )LJXUH LQFOXVLRQV LQ WKH EXON RI WKH EDFNVFDWWHUHG µ6(0¶ SKRWR LQ )LJXUH  >%@ )LJXUH
 >&@ DQG >'@ VKRZ D PDJQLILFDWLRQ RI WKH GRWV RI VFDOH SUHYLRXVO\ LGHQWLILHG DV  >&@ DQG >'@ VKRZ D PDJQLILFDWLRQ RI WKH GRWV RI VFDOH SUHYLRXVO\ LGHQWLILHG DV
R[LGHVXOSKDWHRUVXOSKLWHLQFOXVLRQV FI6HFWLRQ  R[LGHVXOSKDWHRUVXOSKLWHLQFOXVLRQV FI6HFWLRQ 

 
)LJXUH 6FDQQLQJ HOHFWURQ PLFURVFRS\ RI HGJH RI FURVV VHFWLRQ RI HWFKHG FDU )LJXUH 6FDQQLQJ HOHFWURQ PLFURVFRS\ RI HGJH RI FURVV VHFWLRQ RI HWFKHG FDU
ERQVWHHOVDPSOH >$@DQG>&@6HFRQGDU\HOHFWURQ >%@DQG>'@%DFN ERQVWHHOVDPSOH >$@DQG>&@6HFRQGDU\HOHFWURQ >%@DQG>'@%DFN
VFDWWHUHG VFDWWHUHG

 (QHUJ\'LVSHUVLYH;5D\6SHFWURVFRS\  (QHUJ\'LVSHUVLYH;5D\6SHFWURVFRS\


7KHVSHFLILHG>/0*E@DQGPHDVXUHGYDOXHVIURPWKHFKHPLFDODQDO\VLVRIWKH 7KHVSHFLILHG>/0*E@DQGPHDVXUHGYDOXHVIURPWKHFKHPLFDODQDO\VLVRIWKH
LQYHVWLJDWHGFDUERQVWHHODUHOLVWHGLQ7DEOH7KHPHDVXUHGTXDQWLWLHVIRUWKHEXON LQYHVWLJDWHGFDUERQVWHHODUHOLVWHGLQ7DEOH7KHPHDVXUHGTXDQWLWLHVIRUWKHEXON
DUHWDNHQIURPWKHDYHUDJHRIWKHµ('6¶VSHFWUDIURPWKHPLGGOHDQGFORVHWRWKHHGJH DUHWDNHQIURPWKHDYHUDJHRIWKHµ('6¶VSHFWUDIURPWKHPLGGOHDQGFORVHWRWKHHGJH
RIWKHORQJLWXGLQDOVHFWLRQ$GGLWLRQDOO\DFKHPLFDODQDO\VLVIRUWKHLQFOXVLRQPDUNHG RIWKHORQJLWXGLQDOVHFWLRQ$GGLWLRQDOO\DFKHPLFDODQDO\VLVIRUWKHLQFOXVLRQPDUNHG
E\WKHZKLWHFLUFOHLQWKHFURVVVHFWLRQLQ)LJXUH>%@ZDVSHUIRUPHG,WVKRXOGEH E\WKHZKLWHFLUFOHLQWKHFURVVVHFWLRQLQ)LJXUH>%@ZDVSHUIRUPHG,WVKRXOGEH
QRWHGWKDWWKHGHWHFWLRQRIFDUERQLVQRWIHDVLEOHZLWKWKHµ('6¶HTXLSPHQWDW'78 QRWHGWKDWWKHGHWHFWLRQRIFDUERQLVQRWIHDVLEOHZLWKWKHµ('6¶HTXLSPHQWDW'78
%\J %\J
%HVLGHVLURQWKHRQO\WZRHOHPHQWVGHWHFWHGE\µ('6¶LQWKHEXONRIWKHORQJLWXGLQDO %HVLGHVLURQWKHRQO\WZRHOHPHQWVGHWHFWHGE\µ('6¶LQWKHEXONRIWKHORQJLWXGLQDO
VHFWLRQ FROXPQVDQG ZHUHVLOLFRQDQGPDQJDQHVH%RWKPHDVXUHGDYHUDJHVH[ VHFWLRQ FROXPQVDQG ZHUHVLOLFRQDQGPDQJDQHVH%RWKPHDVXUHGDYHUDJHVH[

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO &DUERQ6WHHO5HLQIRUFHPHQW 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO &DUERQ6WHHO5HLQIRUFHPHQW

FHHGWKHVSHFLILHGYDOXHVE\DERXW+RZHYHUWKHGHYLDWLRQDOTXDQWLWLHVDUHUDWKHU FHHGWKHVSHFLILHGYDOXHVE\DERXW+RZHYHUWKHGHYLDWLRQDOTXDQWLWLHVDUHUDWKHU
VPDOO  DQGFRQVLGHUHGWREHZLWKLQWKHHUURUPDUJLQRIWKHHTXLSPHQWIRUGH VPDOO  DQGFRQVLGHUHGWREHZLWKLQWKHHUURUPDUJLQRIWKHHTXLSPHQWIRUGH
WHFWLRQ RI WKHVH HOHPHQWV 7KH TXDQWLWLHV VSHFLILHG IRU WKH RWKHU HOHPHQWV DUH DSDUW WHFWLRQ RI WKHVH HOHPHQWV 7KH TXDQWLWLHV VSHFLILHG IRU WKH RWKHU HOHPHQWV DUH DSDUW
IURPFRSSHUUDWKHUVPDOO7KHUHIRUHWKHVHHOHPHQWVPLJKWUHPDLQXQGHWHFWHGLQWKH IURPFRSSHUUDWKHUVPDOO7KHUHIRUHWKHVHHOHPHQWVPLJKWUHPDLQXQGHWHFWHGLQWKH
VSHFWUD VSHFWUD
7DEOH 6SHFLILHG>/0*E@DQGDYHUDJHGPHDVXUHGFRPSRVLWLRQRILQYHVWL 7DEOH 6SHFLILHG>/0*E@DQGDYHUDJHGPHDVXUHGFRPSRVLWLRQRILQYHVWL
JDWHG FDUERQ VWHHO VDPSOH µ//¶  ORQJLWXGLQDO VHFWLRQ µ&6¶  FURVV JDWHG FDUERQ VWHHO VDPSOH µ//¶  ORQJLWXGLQDO VHFWLRQ µ&6¶  FURVV
VHFWLRQ VHFWLRQ
6SHFLILHG $YJPHDVXUHG $YJPHDVXUHG $YJPHDVXUHG 6SHFLILHG $YJPHDVXUHG $YJPHDVXUHG $YJPHDVXUHG
(OHPHQW >/0*E@ µ//¶ PLGGOH µ//¶ HGJH µ&6¶ LQFOXVLRQ (OHPHQW >/0*E@ µ//¶ PLGGOH µ//¶ HGJH µ&6¶ LQFOXVLRQ
>@ >@ >@ >@ >@ >@ >@ >@
,URQ     ,URQ    
0DQJDQHVH     0DQJDQHVH    
&RSSHU     &RSSHU    
6LOLFRQ     6LOLFRQ    
&DUERQ     &DUERQ    
1LFNHO     1LFNHO    
&KURPLXP     &KURPLXP    
7LQ     7LQ    
0RO\EGHQXP     0RO\EGHQXP    
3KRVSKRUXV     3KRVSKRUXV    
=LQF     =LQF    
1LWURJHQ     1LWURJHQ    
$OXPLQLXP     $OXPLQLXP    
1LRELXP     1LRELXP    
/HDG     /HDG    
6XOSKXU     6XOSKXU    
9DQDGLXP     9DQDGLXP    
7LWDQLXP     7LWDQLXP    
2[\JHQ     2[\JHQ    
&DOFLXP     &DOFLXP    
 
6LOLFRQ DQG PDQJDQHVH DUH GHWHFWHG LQ VLPLODU TXDQWLWLHV LQ WKH DYHUDJHG PHDVXUH 6LOLFRQ DQG PDQJDQHVH DUH GHWHFWHG LQ VLPLODU TXDQWLWLHV LQ WKH DYHUDJHG PHDVXUH
PHQWV RI WKH VSHFWUD IRU WKH LQFOXVLRQ FROXPQ   )XUWKHUPRUH D ODUJH TXDQWLW\ RI PHQWV RI WKH VSHFWUD IRU WKH LQFOXVLRQ FROXPQ   )XUWKHUPRUH D ODUJH TXDQWLW\ RI
R[\JHQ FD ZDVGHWHFWHGRQH[SHQVHRIWKHTXDQWLW\RILURQZKLFKZDVIRXQGWR R[\JHQ FD ZDVGHWHFWHGRQH[SHQVHRIWKHTXDQWLW\RILURQZKLFKZDVIRXQGWR
EHUHGXFHGWRDERXW7KLVLQGLFDWHVWKDWWKHLQYHVWLJDWHGLQFOXVLRQLVFRPSRVHGRI EHUHGXFHGWRDERXW7KLVLQGLFDWHVWKDWWKHLQYHVWLJDWHGLQFOXVLRQLVFRPSRVHGRI
LURQ R[LGH LH D FRUURVLRQ SURGXFW UROOHG LQ IURP WKH VXUIDFH $GGLWLRQDOO\ D VPDOO LURQ R[LGH LH D FRUURVLRQ SURGXFW UROOHG LQ IURP WKH VXUIDFH $GGLWLRQDOO\ D VPDOO
TXDQWLW\RIFDOFLXP FD ZDVGHWHFWHGLQWKHLQFOXVLRQ TXDQWLW\RIFDOFLXP FD ZDVGHWHFWHGLQWKHLQFOXVLRQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RQFUHWH6WHHO,QWHUIDFH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO &RQFUHWH6WHHO,QWHUIDFH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO

 &RQFUHWH6WHHO,QWHUIDFH  &RQFUHWH6WHHO,QWHUIDFH


:KLOH6HFWLRQODUJHO\GHDOWZLWKWKHGHFLVLYHSURSHUWLHVRIWKHEXONFRQFUHWHFRYHU :KLOH6HFWLRQODUJHO\GHDOWZLWKWKHGHFLVLYHSURSHUWLHVRIWKHEXONFRQFUHWHFRYHU
WKHFRQFUHWHVWHHOLQWHUIDFHLHWKHSK\VLFDODGKHVLRQEHWZHHQWKHFHPHQWSDVWHDQG WKHFRQFUHWHVWHHOLQWHUIDFHLHWKHSK\VLFDODGKHVLRQEHWZHHQWKHFHPHQWSDVWHDQG
WKHSDVVLYHOD\HURQWKHVWHHOVXUIDFHLVWUHDWHGLQWKLV6HFWLRQ7KHFRQFUHWHVWHHOLQ WKHSDVVLYHOD\HURQWKHVWHHOVXUIDFHLVWUHDWHGLQWKLV6HFWLRQ7KHFRQFUHWHVWHHOLQ
WHUIDFHLVGHDOWZLWKLQDVHSDUDWH6HFWLRQEHFDXVHLWUHODWHVWRERWKWKHFRQFUHWHEXON WHUIDFHLVGHDOWZLWKLQDVHSDUDWH6HFWLRQEHFDXVHLWUHODWHVWRERWKWKHFRQFUHWHEXON
DQGWKHVWHHOVXUIDFHSURSHUWLHVDQGLWVSDUWLFXODUSURSHUWLHVDUHDGHFLVLYHIDFWRU IRU DQGWKHVWHHOVXUIDFHSURSHUWLHVDQGLWVSDUWLFXODUSURSHUWLHVDUHDGHFLVLYHIDFWRU IRU
WKHLQLWLDWLRQDQGSURSDJDWLRQRIFRUURVLRQHVSHFLDOO\LQWKHFDVHRIFKORULGHLQGXFHG WKHLQLWLDWLRQDQGSURSDJDWLRQRIFRUURVLRQHVSHFLDOO\LQWKHFDVHRIFKORULGHLQGXFHG
FRUURVLRQ FRUURVLRQ
7KHIDFWRUVGHVFULEHGIRUWKHEXONFRQFUHWHKDYHDQREYLRXVLQIOXHQFHRQWKHSURSHU 7KHIDFWRUVGHVFULEHGIRUWKHEXONFRQFUHWHKDYHDQREYLRXVLQIOXHQFHRQWKHSURSHU
WLHV RI WKH FRQFUHWHVWHHO LQWHUIDFH DQG DOVR FUDFNLQJ ORDGLQGXFHG RU LQLWLDO FOHDUO\ WLHV RI WKH FRQFUHWHVWHHO LQWHUIDFH DQG DOVR FUDFNLQJ ORDGLQGXFHG RU LQLWLDO FOHDUO\
LPSDLUV LWV SURWHFWLYH IXQFWLRQV IRU WKH UHLQIRUFLQJ VWHHO )XUWKHUPRUH WKH RIWHQ RE LPSDLUV LWV SURWHFWLYH IXQFWLRQV IRU WKH UHLQIRUFLQJ VWHHO )XUWKHUPRUH WKH RIWHQ RE
VHUYHG VHWWOHPHQW RI WKH FRQFUHWH EHQHDWK KRUL]RQWDO UHLQIRUFHPHQW ZKLFK GRHV QRW VHUYHG VHWWOHPHQW RI WKH FRQFUHWH EHQHDWK KRUL]RQWDO UHLQIRUFHPHQW ZKLFK GRHV QRW
QHFHVVDULO\ LQYROYH FUDFNLQJ DIIHFWV WKLV SURWHFWLYH IXQFWLRQ GUDVWLFDOO\ 6R IURP D QHFHVVDULO\ LQYROYH FUDFNLQJ DIIHFWV WKLV SURWHFWLYH IXQFWLRQ GUDVWLFDOO\ 6R IURP D
FRUURVLRQSURWHFWLRQSHUVSHFWLYHWKHVDPHSULQFLSOHVDSSO\ IRUWKHFRQFUHWHVWHHOLQ FRUURVLRQSURWHFWLRQSHUVSHFWLYHWKHVDPHSULQFLSOHVDSSO\ IRUWKHFRQFUHWHVWHHOLQ
WHUIDFH DVIRUWKHEXONFRQFUHWHLHWKHPRUHGHQVHWKHEHWWHUWKH FRUURVLRQSURWHF WHUIDFH DVIRUWKHEXONFRQFUHWHLHWKHPRUHGHQVHWKHEHWWHUWKH FRUURVLRQSURWHF
WLRQ+RZHYHULQSUDFWLFHDLUYRLGVDWWKHFRQFUHWHVWHHOLQWHUIDFHDQGRWKHULQWHUIDFH WLRQ+RZHYHULQSUDFWLFHDLUYRLGVDWWKHFRQFUHWHVWHHOLQWHUIDFHDQGRWKHULQWHUIDFH
GHIHFWVFDQQRWEHRPLWWHGDQGZLOODOZD\VEHSUHVHQWWRDVPDOOHURUODUJHUH[WHQW7KH GHIHFWVFDQQRWEHRPLWWHGDQGZLOODOZD\VEHSUHVHQWWRDVPDOOHURUODUJHUH[WHQW7KH
PDJQLWXGHRIYRLGVDQGGHIHFWVLVQRWRQO\GHWHUPLQHGE\WKHFRQFUHWHPL[RUWKHVWHHO PDJQLWXGHRIYRLGVDQGGHIHFWVLVQRWRQO\GHWHUPLQHGE\WKHFRQFUHWHPL[RUWKHVWHHO
VXUIDFHSURSHUWLHVEXWODUJHO\GHSHQGHQWRQWKHH[HFXWLRQLQSDUWLFXODUWKHFRPSDF VXUIDFHSURSHUWLHVEXWODUJHO\GHSHQGHQWRQWKHH[HFXWLRQLQSDUWLFXODUWKHFRPSDF
WLRQRIWKHFRQFUHWH7KHYRLGVDQGGHIHFWVKDYHLQSULQFLSOHWZRPDMRUHIIHFWV7KH WLRQRIWKHFRQFUHWH7KHYRLGVDQGGHIHFWVKDYHLQSULQFLSOHWZRPDMRUHIIHFWV7KH
ILUVW UHODWHV WR WKH IRUPDWLRQ RI SRWHQWLDO JUDGLHQWV RQ WKH VXUIDFH RI WKH UHLQIRUFLQJ ILUVW UHODWHV WR WKH IRUPDWLRQ RI SRWHQWLDO JUDGLHQWV RQ WKH VXUIDFH RI WKH UHLQIRUFLQJ
VWHHO FI6HFWLRQ ZKLOHWKHVHFRQGUHODWHVWRWKHFKORULGHWKUHVKROG FI6HFWLRQ VWHHO FI6HFWLRQ ZKLOHWKHVHFRQGUHODWHVWRWKHFKORULGHWKUHVKROG FI6HFWLRQ
   
$VPHQWLRQHGLQ6HFWLRQSRWHQWLDOJUDGLHQWVRQWKHVWHHOVXUIDFHDUHIRUPHGHL $VPHQWLRQHGLQ6HFWLRQSRWHQWLDOJUDGLHQWVRQWKHVWHHOVXUIDFHDUHIRUPHGHL
WKHUGXHWRPHWDOOXUJLFDOGLVVLPLODULWLHVRQWKHVWHHOVXUIDFHRUGXHWRGLIIHUHQFHVLQWKH WKHUGXHWRPHWDOOXUJLFDOGLVVLPLODULWLHVRQWKHVWHHOVXUIDFHRUGXHWRGLIIHUHQFHVLQWKH
LQ WKH HQYLURQPHQW VXUURXQGLQJ GLIIHUHQW DUHDV RQ WKH VDPH VWHHO ,W LV LPSRUWDQW WR LQ WKH HQYLURQPHQW VXUURXQGLQJ GLIIHUHQW DUHDV RQ WKH VDPH VWHHO ,W LV LPSRUWDQW WR
QRWHWKDWDSRWHQWLDOJUDGLHQWGXHWRHQYLURQPHQWDOGLIIHUHQFHVZRXOGHYHQEHIRUPHG QRWHWKDWDSRWHQWLDOJUDGLHQWGXHWRHQYLURQPHQWDOGLIIHUHQFHVZRXOGHYHQEHIRUPHG
LIWKHVWHHOLWVHOIZDVHQWLUHO\KRPRJHQHRXV ZKLFKLVSUDFWLFDOO\LPSRVVLEOH  LIWKHVWHHOLWVHOIZDVHQWLUHO\KRPRJHQHRXV ZKLFKLVSUDFWLFDOO\LPSRVVLEOH 
:HWKLQNWKDWWKHSRWHQWLDOJUDGLHQWVRQWKHVWHHOVXUIDFHUHVXOWLQJIURPWKHLQHYLWDEOH :HWKLQNWKDWWKHSRWHQWLDOJUDGLHQWVRQWKHVWHHOVXUIDFHUHVXOWLQJIURPWKHLQHYLWDEOH
YRLGV DQG LQWHUIDFH GHIHFWV KDYH D PXFK PRUH SURQRXQFHG HIIHFW WKDQ WKH SRWHQWLDO YRLGV DQG LQWHUIDFH GHIHFWV KDYH D PXFK PRUH SURQRXQFHG HIIHFW WKDQ WKH SRWHQWLDO
JUDGLHQWVUHVXOWLQJIURPWKHPHWDOOXUJLFDOGLVVLPLODULWLHVRIWKHVWHHOLWVHOI7KHSRWHQ JUDGLHQWVUHVXOWLQJIURPWKHPHWDOOXUJLFDOGLVVLPLODULWLHVRIWKHVWHHOLWVHOI7KHSRWHQ
WLDOJUDGLHQWVIURPWKHYRLGVDQGLQWHUIDFHGHIHFWVDUHSULPDULO\GXHWRWKHGLIIHUHQFHV WLDOJUDGLHQWVIURPWKHYRLGVDQGLQWHUIDFHGHIHFWVDUHSULPDULO\GXHWRWKHGLIIHUHQFHV
LQ WKH FRQFHQWUDWLRQ RI GLVVROYHG R[\JHQ $UHDV ZLWK LPSHUIHFWLRQV RU YRLGV KDYH D LQ WKH FRQFHQWUDWLRQ RI GLVVROYHG R[\JHQ $UHDV ZLWK LPSHUIHFWLRQV RU YRLGV KDYH D
ODUJHUDYDLODELOLW\RIR[\JHQDQGEHFRPHFDWKRGLFZKHUHDVDGHQVHFRQFUHWHVWHHOLQ ODUJHUDYDLODELOLW\RIR[\JHQDQGEHFRPHFDWKRGLFZKHUHDVDGHQVHFRQFUHWHVWHHOLQ
WHUIDFHOLPLWVR[\JHQDYDLODELOLW\DQGWKHDVVRFLDWHGDUHDVEHFRPHDQRGLFVLWHV+RZ WHUIDFHOLPLWVR[\JHQDYDLODELOLW\DQGWKHDVVRFLDWHGDUHDVEHFRPHDQRGLFVLWHV+RZ
HYHUWKHIRUPDWLRQRI DQRGLFDQG FDWKRGLFVLWHVLVQRWRQO\ DVVRFLDWHG ZLWKR[\JHQ HYHUWKHIRUPDWLRQRI DQRGLFDQG FDWKRGLFVLWHVLVQRWRQO\ DVVRFLDWHG ZLWKR[\JHQ
%DVLFDOO\DQ\GLVVROYHGVSHFLHVFDQOHDGWRFRQFHQWUDWLRQFHOOVDQGWKXVWRWKHIRUPD %DVLFDOO\DQ\GLVVROYHGVSHFLHVFDQOHDGWRFRQFHQWUDWLRQFHOOVDQGWKXVWRWKHIRUPD
WLRQRIDQRGLFDQGFDWKRGLFVLWHVZKLFKORFDOLVHGHSHQGHQWRQWKHJLYHQFRQGLWLRQRI WLRQRIDQRGLFDQGFDWKRGLFVLWHVZKLFKORFDOLVHGHSHQGHQWRQWKHJLYHQFRQGLWLRQRI
WKHFRQFUHWHVWHHOLQWHUIDFH)RULQVWDQFHORFDOYDULDWLRQVLQWKHDONDOLQLW\FDQSOD\D WKHFRQFUHWHVWHHOLQWHUIDFH)RULQVWDQFHORFDOYDULDWLRQVLQWKHDONDOLQLW\FDQSOD\D
VLJQLILFDQWUROHLQWKHIRUPDWLRQRISRWHQWLDOJUDGLHQWV VLJQLILFDQWUROHLQWKHIRUPDWLRQRISRWHQWLDOJUDGLHQWV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO &RQFUHWH6WHHO,QWHUIDFH 3URSHUWLHVRI&RQFUHWHDQG5HLQIRUFLQJ6WHHO &RQFUHWH6WHHO,QWHUIDFH

7KHDERYHIDFWRUVUHODWHWRSRWHQWLDOJUDGLHQWVZKLFKGRJHQHUDOO\QRWOHDGWRSURE 7KHDERYHIDFWRUVUHODWHWRSRWHQWLDOJUDGLHQWVZKLFKGRJHQHUDOO\QRWOHDGWRSURE
OHPVDVORQJDVWKHVWHHOLVLQWKHSDVVLYHVWDWH$IWHUGHSDVVLYDWLRQWKHVHJUDGLHQWVRE OHPVDVORQJDVWKHVWHHOLVLQWKHSDVVLYHVWDWH$IWHUGHSDVVLYDWLRQWKHVHJUDGLHQWVRE
YLRXVO\LQFUHDVHWKHFRUURVLRQUDWHE\HQKDQFLQJWKHFDWKRGLFUHDFWLRQ+RZHYHUZH YLRXVO\LQFUHDVHWKHFRUURVLRQUDWHE\HQKDQFLQJWKHFDWKRGLFUHDFWLRQ+RZHYHUZH
WKLQN WKDW YRLGV DQG GHIHFWV DW WKH FRQFUHWHVWHHO LQWHUIDFH DUH RI HYHQ PRUH LPSRU WKLQN WKDW YRLGV DQG GHIHFWV DW WKH FRQFUHWHVWHHO LQWHUIDFH DUH RI HYHQ PRUH LPSRU
WDQFHZLWKUHJDUGWRWKHHIIHFWRQWKHFKORULGHWKUHVKROG7KHHIIHFWRILQWHUIDFLDODLU WDQFHZLWKUHJDUGWRWKHHIIHFWRQWKHFKORULGHWKUHVKROG7KHHIIHFWRILQWHUIDFLDODLU
YRLGVRQWKHFKORULGHWKUHVKROGLVE\WKHUHGOLQHLQ)LJXUH YRLGVRQWKHFKORULGHWKUHVKROGLVE\WKHUHGOLQHLQ)LJXUH

   
)LJXUH &KORULGHWKUHVKROGDVIXQFWLRQRILQWHUIDFLDOYRLGV$TXDOLWDWLYHDYHU )LJXUH &KORULGHWKUHVKROGDVIXQFWLRQRILQWHUIDFLDOYRLGV$TXDOLWDWLYHDYHU
DJH RI XQWUHDWHG UHIHUHQFH VDPSOHV LV JLYHQ E\ WKH UHG OLQH 7KH EOXH DJH RI XQWUHDWHG UHIHUHQFH VDPSOHV LV JLYHQ E\ WKH UHG OLQH 7KH EOXH
GRWLQGLFDWHVWKHWKUHVKROGPHDVXUHGIRUVDPSOHVWKDWKDYHEHHQHOHF GRWLQGLFDWHVWKHWKUHVKROGPHDVXUHGIRUVDPSOHVWKDWKDYHEHHQHOHF
WURFKHPLFDOO\ WUHDWHG GXULQJ VHWWLQJ RI WKH FRQFUHWH FI 6HFWLRQ WURFKHPLFDOO\ WUHDWHG GXULQJ VHWWLQJ RI WKH FRQFUHWH FI 6HFWLRQ
 $IWHU>%XHQIHOGHWDO@  $IWHU>%XHQIHOGHWDO@
$VLOOXVWUDWHGLQ)LJXUHLWKDVEHHQGHWHUPLQHGWKDWWKHFKORULGHWKUHVKROGFRXOG $VLOOXVWUDWHGLQ)LJXUHLWKDVEHHQGHWHUPLQHGWKDWWKHFKORULGHWKUHVKROGFRXOG
EHODUJHO\LQFUHDVHGLIWKHSHUFHQWDJHRILQWHUIDFLDOYRLGVZDVEURXJKWEHORZ EHODUJHO\LQFUHDVHGLIWKHSHUFHQWDJHRILQWHUIDFLDOYRLGVZDVEURXJKWEHORZ
&KORULGHWKUHVKROGVXSWRµZZFH¶FRXOGEHUHDFKHGE\UHGXFLQJWKHSHUFHQWDJHRI &KORULGHWKUHVKROGVXSWRµZZFH¶FRXOGEHUHDFKHGE\UHGXFLQJWKHSHUFHQWDJHRI
LQWHUIDFLDO YRLGV WR DERXW  2Q WKH RWKHU KDQG DQ LQFUHDVH LQ WKH SHUFHQWDJH RI LQWHUIDFLDO YRLGV WR DERXW  2Q WKH RWKHU KDQG DQ LQFUHDVH LQ WKH SHUFHQWDJH RI
LQWHUIDFLDOYRLGVWRPRUHWKDQGHFUHDVHGWKHFKORULGHWKUHVKROGODUJHO\DQGYDOXHV LQWHUIDFLDOYRLGVWRPRUHWKDQGHFUHDVHGWKHFKORULGHWKUHVKROGODUJHO\DQGYDOXHV
DVORZDVµZZFH¶KDYHEHHQPHDVXUHG DVORZDVµZZFH¶KDYHEHHQPHDVXUHG
7KXVLWFDQEHFRQFOXGHGWKDWWKHSURSHUWLHVRIWKHFRQFUHWHVWHHOLQWHUIDFHKDYHDPD 7KXVLWFDQEHFRQFOXGHGWKDWWKHSURSHUWLHVRIWKHFRQFUHWHVWHHOLQWHUIDFHKDYHDPD
MRULQIOXHQFHRQFKORULGHLQGXFHGUHLQIRUFHPHQWFRUURVLRQ:HWKLQNWKDWWKHVHSK\VL MRULQIOXHQFHRQFKORULGHLQGXFHGUHLQIRUFHPHQWFRUURVLRQ:HWKLQNWKDWWKHVHSK\VL
FDOSURSHUWLHVRIWKHFRQFUHWHVWHHOLQWHUIDFHDUHRIPDMRULPSRUWDQFHDQGUHJDUGYRLGV FDOSURSHUWLHVRIWKHFRQFUHWHVWHHOLQWHUIDFHDUHRIPDMRULPSRUWDQFHDQGUHJDUGYRLGV
RULQWHUIDFHGHIHFWVDVDQHFHVVDU\FRQGLWLRQIRUFRUURVLRQLQLWLDWLRQ<HWZHFRQVLGHU RULQWHUIDFHGHIHFWVDVDQHFHVVDU\FRQGLWLRQIRUFRUURVLRQLQLWLDWLRQ<HWZHFRQVLGHU
DUHGXFWLRQLQWKHSHUFHQWDJHRILQWHUIDFLDOYRLGVWRYDOXHVEHORZWREHSUDFWL DUHGXFWLRQLQWKHSHUFHQWDJHRILQWHUIDFLDOYRLGVWRYDOXHVEHORZWREHSUDFWL
FDOO\LPSRVVLEOHWRDFKLHYHE\FRQYHQWLRQDOWHFKQLTXHV&RQVLGHUDWLRQVRQDOWHUQDWLYH FDOO\LPSRVVLEOHWRDFKLHYHE\FRQYHQWLRQDOWHFKQLTXHV&RQVLGHUDWLRQVRQDOWHUQDWLYH
ZD\VLHHOHFWURFKHPLFDODQGFKHPLFDOPHWKRGVWRUHGXFHYRLGVDWWKHFRQFUHWHVWHHO ZD\VLHHOHFWURFKHPLFDODQGFKHPLFDOPHWKRGVWRUHGXFHYRLGVDWWKHFRQFUHWHVWHHO
LQWHUIDFHWRWKHPLQLPXPSOD\DPDMRUUROHLQWKHGHYHORSPHQWRIWKHSURSRVHGQHZ LQWHUIDFHWRWKHPLQLPXPSOD\DPDMRUUROHLQWKHGHYHORSPHQWRIWKHSURSRVHGQHZ
FRXQWHUPHDVXUHV FI6HFWLRQDQG&KDSWHU  FRXQWHUPHDVXUHV FI6HFWLRQDQG&KDSWHU 
 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 

 $SSOLFDWLRQRI7KHUPRG\QDPLFV  $SSOLFDWLRQRI7KHUPRG\QDPLFV
,Q WKLV &KDSWHU WKH SURSRVHG DSSOLFDWLRQ RI WKH WKHUPRG\QDPLF SULQFLSOHV DQG WRROV ,Q WKLV &KDSWHU WKH SURSRVHG DSSOLFDWLRQ RI WKH WKHUPRG\QDPLF SULQFLSOHV DQG WRROV
LQWURGXFHGLQ6HFWLRQLVVXPPDULVHGDQGWKHLUYDOLGLW\LQWKHDUHDRIUHLQIRUFHPHQW LQWURGXFHGLQ6HFWLRQLVVXPPDULVHGDQGWKHLUYDOLGLW\LQWKHDUHDRIUHLQIRUFHPHQW
FRUURVLRQLVGLVFXVVHG$VLQGLFDWHGWKURXJKRXW6HFWLRQZHWKLQNWKDWWKHUPRG\ FRUURVLRQLVGLVFXVVHG$VLQGLFDWHGWKURXJKRXW6HFWLRQZHWKLQNWKDWWKHUPRG\
QDPLF SULQFLSOHV DQG WRROV SURYLGH VHYHUDO EHQHILFLDO PHDQV IRU WKH XQGHUVWDQGLQJ QDPLF SULQFLSOHV DQG WRROV SURYLGH VHYHUDO EHQHILFLDO PHDQV IRU WKH XQGHUVWDQGLQJ
DQGGHVFULSWLRQRIFRUURVLRQSURFHVVHVDQGHYHQPRUHLPSRUWDQWIRUWKHSXUSRVHRI DQGGHVFULSWLRQRIFRUURVLRQSURFHVVHVDQGHYHQPRUHLPSRUWDQWIRUWKHSXUSRVHRI
WKLVWKHVLVDOORZWKHRUHWLFDOO\EDVHGSUHGLFWLRQVRQWKHEHKDYLRXURIV\VWHPV)URPD WKLVWKHVLVDOORZWKHRUHWLFDOO\EDVHGSUHGLFWLRQVRQWKHEHKDYLRXURIV\VWHPV)URPD
WKHRUHWLFDO SRLQW RI YLHZ WKH XQGHUO\LQJ SULQFLSOHV IRU WKHUPRG\QDPLF GHVFULSWLRQV WKHRUHWLFDO SRLQW RI YLHZ WKH XQGHUO\LQJ SULQFLSOHV IRU WKHUPRG\QDPLF GHVFULSWLRQV
DQGSUHGLFWLRQVDUHUDWKHUVLPSOH FI6HFWLRQ EXWWKHDVVXPSWLRQVIRUWKHHVWDE DQGSUHGLFWLRQVDUHUDWKHUVLPSOH FI6HFWLRQ EXWWKHDVVXPSWLRQVIRUWKHHVWDE
OLVKPHQWRIDSSURSULDWH DQGUHSUHVHQWDWLYHPRGHOVIRUWKHGHVFULSWLRQDQGSUHGLFWLRQ OLVKPHQWRIDSSURSULDWH DQGUHSUHVHQWDWLYHPRGHOVIRUWKHGHVFULSWLRQDQGSUHGLFWLRQ
RIDV\VWHPDUHUDWKHUFRPSOH[7KDWKROGVLQSDUWLFXODUIRUWKHPXOWLIDFHWHGSK\VLFDO RIDV\VWHPDUHUDWKHUFRPSOH[7KDWKROGVLQSDUWLFXODUIRUWKHPXOWLIDFHWHGSK\VLFDO
FKHPLFDODQGHOHFWURFKHPLFDOSURSHUWLHVRIWKHFRQFUHWHVWHHOV\VWHP FI&KDSWHU  FKHPLFDODQGHOHFWURFKHPLFDOSURSHUWLHVRIWKHFRQFUHWHVWHHOV\VWHP FI&KDSWHU 
2XU WKHUPRG\QDPLF PRGHOV DUH EDVHG RQ WKH HVWDEOLVKPHQW RI UHDFWLRQ PHFKDQLVPV 2XU WKHUPRG\QDPLF PRGHOV DUH EDVHG RQ WKH HVWDEOLVKPHQW RI UHDFWLRQ PHFKDQLVPV
FI 6HFWLRQ   DQG LQ SDUWLFXODU RQ WKH DSSOLFDWLRQ RI WKH 3RXUEDL[ GLDJUDP FI FI 6HFWLRQ   DQG LQ SDUWLFXODU RQ WKH DSSOLFDWLRQ RI WKH 3RXUEDL[ GLDJUDP FI
6HFWLRQ 6RLQWKLV&KDSWHUVSHFLDOIRFXVLVVHWRQWKHHVWDEOLVKPHQWRIDSSUR 6HFWLRQ 6RLQWKLV&KDSWHUVSHFLDOIRFXVLVVHWRQWKHHVWDEOLVKPHQWRIDSSUR
SULDWHDQGUHSUHVHQWDWLYH3RXUEDL[GLDJUDPV SULDWHDQGUHSUHVHQWDWLYH3RXUEDL[GLDJUDPV
,Q6HFWLRQVHOHFWHGLQIRUPDWLRQRQWKHUPRG\QDPLFGDWDDQGWKHZD\ZHGHDOWZLWK ,Q6HFWLRQVHOHFWHGLQIRUPDWLRQRQWKHUPRG\QDPLFGDWDDQGWKHZD\ZHGHDOWZLWK
HQFRXQWHUHG WKHUPRG\QDPLF GLVFUHSDQFLHV LV VXPPDULVHG ,Q 6HFWLRQ  RXU VXJ HQFRXQWHUHG WKHUPRG\QDPLF GLVFUHSDQFLHV LV VXPPDULVHG ,Q 6HFWLRQ  RXU VXJ
JHVWHG PHWKRG IRU WKH HVWDEOLVKPHQW DQG DSSOLFDWLRQ RI 3RXUEDL[ GLDJUDPV LV GLV JHVWHG PHWKRG IRU WKH HVWDEOLVKPHQW DQG DSSOLFDWLRQ RI 3RXUEDL[ GLDJUDPV LV GLV
FXVVHGLQGHWDLO FXVVHGLQGHWDLO

 7KHUPRG\QDPLF'DWD  7KHUPRG\QDPLF'DWD


$VPHQWLRQHGLQ6HFWLRQDOOQXPHULFDOWKHUPRG\QDPLFGDWDDVZHOODVDOOHTXLOLE $VPHQWLRQHGLQ6HFWLRQDOOQXPHULFDOWKHUPRG\QDPLFGDWDDVZHOODVDOOHTXLOLE
ULDIRUWKH3RXUEDL[GLDJUDPVKDYHEHHQFDOFXODWHGXVLQJµ+6&¶DQGWKH\DUHKHQFH ULDIRUWKH3RXUEDL[GLDJUDPVKDYHEHHQFDOFXODWHGXVLQJµ+6&¶DQGWKH\DUHKHQFH
ODUJHO\EDVHGRQWKHWKHUPRG\QDPLFGDWDEDVHSURYLGHGLQµ+6&¶>2XNX2XNX ODUJHO\EDVHGRQWKHWKHUPRG\QDPLFGDWDEDVHSURYLGHGLQµ+6&¶>2XNX2XNX
@7KHUPRG\QDPLFFDOFXODWLRQVLQµ+6&¶DUHEDVHGRQWKHWKUHHIXQGDPHQWDOSD @7KHUPRG\QDPLFFDOFXODWLRQVLQµ+6&¶DUHEDVHGRQWKHWKUHHIXQGDPHQWDOSD
UDPHWHUVWKDWGHVFULEHWKHWKHUPRG\QDPLFSURSHUWLHVRIDFKHPLFDOVSHFLHVHQWKDOS\ UDPHWHUVWKDWGHVFULEHWKHWKHUPRG\QDPLFSURSHUWLHVRIDFKHPLFDOVSHFLHVHQWKDOS\
µ+¶HQWURS\µ6¶DQGKHDWFDSDFLW\µ&S¶ 7KHWKHRU\EHKLQGWKHVHSDUDPHWHUVZDVLQ µ+¶HQWURS\µ6¶DQGKHDWFDSDFLW\µ&S¶ 7KHWKHRU\EHKLQGWKHVHSDUDPHWHUVZDVLQ
WHQWLRQDOO\RPLWWHGLQ6HFWLRQEHFDXVHWKH\DUH³LQGLUHFW´SDUDPHWHUVLQWKHWKHU WHQWLRQDOO\RPLWWHGLQ6HFWLRQEHFDXVHWKH\DUH³LQGLUHFW´SDUDPHWHUVLQWKHWKHU
PRG\QDPLFFDOFXODWLRQVLQFOXGHGLQWKLVWKHVLVDQGWKHUHODWHGWKHRU\LVFRQVLGHUHGWR PRG\QDPLFFDOFXODWLRQVLQFOXGHGLQWKLVWKHVLVDQGWKHUHODWHGWKHRU\LVFRQVLGHUHGWR
EHPDUJLQDOIRULWVVFRSH)RUDGHWDLOHGLQWURGXFWLRQWRWKHWKHRUHWLFDOEDFNJURXQGRI EHPDUJLQDOIRULWVVFRSH)RUDGHWDLOHGLQWURGXFWLRQWRWKHWKHRUHWLFDOEDFNJURXQGRI
WKHVH IXQGDPHQWDO SDUDPHWHUV UHIHUHQFH LV PDGH WR HJ >)UHLHVOHEHQ+DQVHQ  WKHVH IXQGDPHQWDO SDUDPHWHUV UHIHUHQFH LV PDGH WR HJ >)UHLHVOHEHQ+DQVHQ 
6FKURHGHU0¡OOHUD@+RZHYHUDFHUWDLQH[WHQWRINQRZOHGJHRQDQGDS 6FKURHGHU0¡OOHUD@+RZHYHUDFHUWDLQH[WHQWRINQRZOHGJHRQDQGDS
SOLFDWLRQRIWKHVHSDUDPHWHUVZDVUHTXLUHGLQWKHWKHRUHWLFDOSDUWRIWKLVSURMHFWHJWR SOLFDWLRQRIWKHVHSDUDPHWHUVZDVUHTXLUHGLQWKHWKHRUHWLFDOSDUWRIWKLVSURMHFWHJWR
XWLOLVHWKHUPRG\QDPLFGDWDIURPGLIIHUHQWVRXUFHVDQGWKHUHOHYDQWEDFNJURXQGLVLQ XWLOLVHWKHUPRG\QDPLFGDWDIURPGLIIHUHQWVRXUFHVDQGWKHUHOHYDQWEDFNJURXQGLVLQ
WURGXFHGLQDEULHIDQGODUJHO\VLPSOLILHGVXPPDU\LQWKHIROORZLQJ WURGXFHGLQDEULHIDQGODUJHO\VLPSOLILHGVXPPDU\LQWKHIROORZLQJ
‡ (QWKDOS\DQGKHDWFDSDFLW\RIFKHPLFDOVSHFLHV ‡ (QWKDOS\DQGKHDWFDSDFLW\RIFKHPLFDOVSHFLHV

 

7KXVWKHQDPHµ+6&¶IRUWKHDSSOLHGVRIWZDUH 7KXVWKHQDPHµ+6&¶IRUWKHDSSOLHGVRIWZDUH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$SSOLFDWLRQRI7KHUPRG\QDPLFV 7KHUPRG\QDPLF'DWD $SSOLFDWLRQRI7KHUPRG\QDPLFV 7KHUPRG\QDPLF'DWD

7KHHQWKDOS\µ+¶RIDV\VWHPFDQEHGHILQHGDV>,83$&@³,QWHUQDOHQHUJ\ 7KHHQWKDOS\µ+¶RIDV\VWHPFDQEHGHILQHGDV>,83$&@³,QWHUQDOHQHUJ\
RI D V\VWHP SOXV WKH SURGXFW RI SUHVVXUH DQG YROXPH ,WV FKDQJH LQ D V\VWHP LV RI D V\VWHP SOXV WKH SURGXFW RI SUHVVXUH DQG YROXPH ,WV FKDQJH LQ D V\VWHP LV
HTXDOWRWKHKHDWEURXJKWWRWKHV\VWHPDWFRQVWDQWSUHVVXUH´6LPLODUWRHOHFWURGH HTXDOWRWKHKHDWEURXJKWWRWKHV\VWHPDWFRQVWDQWSUHVVXUH´6LPLODUWRHOHFWURGH
SRWHQWLDOV FI 6HFWLRQ   DEVROXWH YDOXHV RI WKH HQWKDOS\ RI FKHPLFDO VSHFLHV SRWHQWLDOV FI 6HFWLRQ   DEVROXWH YDOXHV RI WKH HQWKDOS\ RI FKHPLFDO VSHFLHV
FDQQRW EH PHDVXUHG EXW HQWKDOS\ GLIIHUHQFHV EHWZHHQ WZR WHPSHUDWXUHV FDQ EH FDQQRW EH PHDVXUHG EXW HQWKDOS\ GLIIHUHQFHV EHWZHHQ WZR WHPSHUDWXUHV FDQ EH
GHWHUPLQHGZLWKDFDORULPHWHU,QRUGHUWRDFKLHYHWKLVWKHKHDW FDSDFLW\ DWFRQ GHWHUPLQHGZLWKDFDORULPHWHU ,QRUGHUWR DFKLHYHWKLVWKHKHDW FDSDFLW\ DWFRQ
VWDQWSUHVVXUHµ&S¶ WKH VRFDOOHGVSHFLILFKHDWLVWREHGHWHUPLQHG7KH KHDWFD VWDQWSUHVVXUHµ&S¶ WKH VRFDOOHG VSHFLILF KHDW LV WREH GHWHUPLQHG 7KH KHDWFD
SDFLW\RIDV\VWHPFDQEHGHILQHGDV>,83$&@³+HDWEURXJKWWRDV\VWHPWR SDFLW\RIDV\VWHPFDQEHGHILQHGDV>,83$&@³+HDWEURXJKWWRDV\VWHPWR
LQFUHDVHLWVWHPSHUDWXUHGLYLGHGE\WKDWWHPSHUDWXUHLQFUHDVH´7KXVµ&S¶FDQEH LQFUHDVHLWVWHPSHUDWXUHGLYLGHGE\WKDWWHPSHUDWXUHLQFUHDVH´7KXVµ&S¶FDQEH
FDOFXODWHGIURPFDORULPHWULFGDWDDFFRUGLQJWR FDOFXODWHGIURPFDORULPHWULFGDWDDFFRUGLQJWR

§ ∂+ · § ∂+ ·
 &S ( 7 ) = ¨ ¸  >@  &S ( 7 ) = ¨ ¸  >@
© ∂7 ¹S © ∂7 ¹S

7KLVDOORZVWKHFDOFXODWLRQRIWKHHQWKDOS\µ+¶RIDFKHPLFDOVSHFLHVDFFRUGLQJWR 7KLVDOORZVWKHFDOFXODWLRQRIWKHHQWKDOS\µ+¶RIDFKHPLFDOVSHFLHVDFFRUGLQJWR
7 7

 + ( 7 ) = + + ³ &S ( 7 ) G7  >@  + ( 7 ) = + + ³ &S ( 7 ) G7  >@


 

ZKHUHµ+¶LVWKHHQWKDOS\DWVWDQGDUGVWDWHFRQGLWLRQV$OOSXUHLVRODWHGHOHPHQWV ZKHUHµ+¶LVWKHHQWKDOS\DWVWDQGDUGVWDWHFRQGLWLRQV$OOSXUHLVRODWHGHOHPHQWV
LQ WKHLU VWDQGDUG VWDWHV HJ )H 2 DQG + KDYH D µ+¶ RI ]HUR LQ WKHLU VWDQGDUG VWDWHV HJ )H 2 DQG + KDYH D µ+¶ RI ]HUR
>)UHLHVOHEHQ+DQVHQ@ >)UHLHVOHEHQ+DQVHQ@
‡ (QWURS\RIFKHPLFDOVSHFLHV ‡ (QWURS\RIFKHPLFDOVSHFLHV
7KH HQWURS\ µ6¶ RI D V\VWHP FDQEH GHILQHG DV >,83$& @³4XDQWLW\RIWKH 7KH HQWURS\ µ6¶ RI D V\VWHP FDQEH GHILQHG DV >,83$& @³4XDQWLW\RIWKH
FKDQJHZKLFKLVHTXDOWRWKHKHDWEURXJKWWRWKHV\VWHPLQDUHYHUVLEOHSURFHVVDW FKDQJHZKLFKLVHTXDOWRWKHKHDWEURXJKWWRWKHV\VWHPLQDUHYHUVLEOHSURFHVVDW
FRQVWDQWWHPSHUDWXUHGLYLGHGE\WKDWWHPSHUDWXUH(QWURS\LV]HURIRUDQ LGHDOO\ FRQVWDQWWHPSHUDWXUHGLYLGHGE\WKDWWHPSHUDWXUH(QWURS\LV]HURIRUDQLGHDOO\
RUGHUHGFU\VWDODW.´$EVROXWHHQWURSLHVFDQEHFDOFXODWHGIURPH[SHULPHQWDOO\ RUGHUHGFU\VWDODW.´$EVROXWHHQWURSLHVFDQEHFDOFXODWHGIURPH[SHULPHQWDOO\
GHWHUPLQHGYDOXHVDFFRUGLQJWR GHWHUPLQHGYDOXHVDFFRUGLQJWR
7
&S ( 7 ) Δ+
7
&S ( 7 ) Δ+
 6 ( 7 ) = 6( ) + ³ G7 + ¦  >@  6 ( 7 ) = 6( ) + ³ G7 + ¦  >@

7 7 
7 7

ZKHUHµ6  ¶LVWKHHQWURS\RIDFKHPLFDOVSHFLHVDW.DQGµ¨+¶LVWKHHQWKDOS\ ZKHUHµ6  ¶LVWKHHQWURS\RIDFKHPLFDOVSHFLHVDW.DQGµ¨+¶LVWKHHQWKDOS\


RISKDVHWUDQVIRUPDWLRQLHWKHHQWKDOS\FKDQJH RISKDVHWUDQVIRUPDWLRQLHWKHHQWKDOS\FKDQJH
7KXV µ+¶ µ6¶ DQG µ&S¶ FDQ DOO EH GHULYHG IURP H[SHULPHQWDO LQYHVWLJDWLRQV 0DQ\ 7KXV µ+¶ µ6¶ DQG µ&S¶ FDQ DOO EH GHULYHG IURP H[SHULPHQWDO LQYHVWLJDWLRQV 0DQ\
H[SHULPHQWDODQGWKHRUHWLFDOPHWKRGVDUHDYDLODEOHIRUGHWHUPLQDWLRQRIWKHVHSDUDPH H[SHULPHQWDODQGWKHRUHWLFDOPHWKRGVDUHDYDLODEOHIRUGHWHUPLQDWLRQRIWKHVHSDUDPH
WHUV 8VXDOO\ D FULWLFDO DQDO\VLV RI WKH YDOXHV LV EDVHG RQ D WKRURXJK VLPXOWDQHRXV WHUV 8VXDOO\ D FULWLFDO DQDO\VLV RI WKH YDOXHV LV EDVHG RQ D WKRURXJK VLPXOWDQHRXV
FURVVFRUUHODWLRQRIWKHUPRFKHPLFDOGDWDIURPGLIIHUHQWVRXUFHVH[SHULPHQWDOPHDV FURVVFRUUHODWLRQRIWKHUPRFKHPLFDOGDWDIURPGLIIHUHQWVRXUFHVH[SHULPHQWDOPHDV
XUHPHQW HJ FDORULPHWULF VSHFWURVFRSLF HOHFWURPRWLYH IRUFH DQG VROXELOLW\ PHDV XUHPHQW HJ FDORULPHWULF VSHFWURVFRSLF HOHFWURPRWLYH IRUFH DQG VROXELOLW\ PHDV
XUHPHQWVDVZHOODVRQWKHRUHWLFDOFDOFXODWLRQV$GHWDLOHGGLVFXVVLRQRQWKHVHPHWK XUHPHQWVDVZHOODVRQWKHRUHWLFDOFDOFXODWLRQV$GHWDLOHGGLVFXVVLRQRQWKHVHPHWK
RGV JRHV EH\RQG WKH VFRSH RI WKLV WKHVLV $PRQJ VWDQGDUG WH[WERRNV RQ SK\VLFDO RGV JRHV EH\RQG WKH VFRSH RI WKLV WKHVLV $PRQJ VWDQGDUG WH[WERRNV RQ SK\VLFDO
FKHPLVWU\ DQG WKHUPRG\QDPLFV UHIHUHQFH LV PDGH WR >)UHLHVOHEHQ+DQVHQ  FKHPLVWU\ DQG WKHUPRG\QDPLFV UHIHUHQFH LV PDGH WR >)UHLHVOHEHQ+DQVHQ 
6FKURHGHU5RLQH@ 6FKURHGHU5RLQH@

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHUPRG\QDPLF'DWD $SSOLFDWLRQRI7KHUPRG\QDPLFV 7KHUPRG\QDPLF'DWD $SSOLFDWLRQRI7KHUPRG\QDPLFV

,Q SULQFLSOH DOO WKHUPRG\QDPLF SDUDPHWHUV LQ WKLV WKHVLV ZHUH FDOFXODWHG EDVHG RQ ,Q SULQFLSOH DOO WKHUPRG\QDPLF SDUDPHWHUV LQ WKLV WKHVLV ZHUH FDOFXODWHG EDVHG RQ
WKHVHSDUDPHWHUVXVLQJWKHIXQGDPHQWDOGHILQLWLRQRIWKH*LEEVHQHUJ\ LQWKHOLWHUD WKHVHSDUDPHWHUVXVLQJWKHIXQGDPHQWDOGHILQLWLRQRIWKH*LEEVHQHUJ\ LQWKHOLWHUD
WXUHDOVRUHIHUUHGWRDVIUHHHQHUJ\IUHHHQWKDOS\*LEEVIUHHHQHUJ\RU*LEEVIXQF WXUHDOVRUHIHUUHGWRDVIUHHHQHUJ\IUHHHQWKDOS\*LEEVIUHHHQHUJ\RU*LEEVIXQF
WLRQ µ*¶ >,83$&@ ³(QWKDOS\PLQXVWKHSURGXFWRIWKHUPRG\QDPLFWHPSHUD WLRQ µ*¶ >,83$&@ ³(QWKDOS\PLQXVWKHSURGXFWRIWKHUPRG\QDPLFWHPSHUD
WXUHDQGHQWURS\´ZKLFKFRUUHVSRQGVWR WXUHDQGHQWURS\´ZKLFKFRUUHVSRQGVWR
* ≡ + − 7 ×6  >@ * ≡ + − 7 ×6  >@

(TXDWLRQ>@FDQEHH[SUHVVHGLQWHUPVRIµ¨*¶LHUHODWLQJWRWKHGHOWDVFDOHDV (TXDWLRQ>@FDQEHH[SUHVVHGLQWHUPVRIµ¨*¶LHUHODWLQJWRWKHGHOWDVFDOHDV

Δ* = Δ+ − Δ ( 7 × 6 )  >@ Δ* = Δ+ − Δ ( 7 × 6 )  >@

ZKLFKXQGHUFRQVWDQWWHPSHUDWXUHDQGSUHVVXUHFRUUHVSRQGVWR ZKLFKXQGHUFRQVWDQWWHPSHUDWXUHDQGSUHVVXUHFRUUHVSRQGVWR
Δ* = Δ+ − 7 × Δ6  >@ Δ* = Δ+ − 7 × Δ6  >@

ZLWK µ¨+¶ DQG µ¨6¶ DV WKH FKDQJH RI HQWKDOS\ DQG HQWURS\ RI SKDVH WUDQVIRUPDWLRQ ZLWK µ¨+¶ DQG µ¨6¶ DV WKH FKDQJH RI HQWKDOS\ DQG HQWURS\ RI SKDVH WUDQVIRUPDWLRQ
UHVSHFWLYHO\)LQDOO\µ¨*¶FDQEHUHODWHGWRWKHHTXLOLEULXPSRWHQWLDOµ(¶DVGHULYHG UHVSHFWLYHO\)LQDOO\µ¨*¶FDQEHUHODWHGWRWKHHTXLOLEULXPSRWHQWLDOµ(¶DVGHULYHG
LQ6HFWLRQ LQ6HFWLRQ
Δ* = − Q × ) × (   >@ Δ* = − Q × ) × (   >@

6RWKHQXPHULFDOYDOXHVRIµ¨*¶DQGµ(¶DVZHOODVWKHHTXLOLEULXPOLQHVLQWKH3RXU 6RWKHQXPHULFDOYDOXHVRIµ¨*¶DQGµ(¶DVZHOODVWKHHTXLOLEULXPOLQHVLQWKH3RXU
EDL[GLDJUDPFDQEHGHWHUPLQHGIURPWKHHQWKDOSLHVDQGHQWURSLHVRIWKHVSHFLHVSUH EDL[GLDJUDPFDQEHGHWHUPLQHGIURPWKHHQWKDOSLHVDQGHQWURSLHVRIWKHVSHFLHVSUH
VHQW LQ WKH V\VWHP XQGHU LQYHVWLJDWLRQ (QWKDOS\ DQG HQWURS\ YDOXHV DUH SURYLGHG LQ VHQW LQ WKH V\VWHP XQGHU LQYHVWLJDWLRQ (QWKDOS\ DQG HQWURS\ YDOXHV DUH SURYLGHG LQ
YDULRXVOLWHUDWXUHLQFOXGLQJKDQGERRNVFRQWDLQLQJWKHUPRG\QDPLFGDWD HJ>1DXPRY YDULRXVOLWHUDWXUHLQFOXGLQJKDQGERRNVFRQWDLQLQJWKHUPRG\QDPLFGDWD HJ>1DXPRY
:DJPDQHWDO%DULQ)UHLHVOHEHQ+DQVHQ/LGH@ DQG :DJPDQHWDO%DULQ)UHLHVOHEHQ+DQVHQ/LGH@ DQG
RQOLQH GDWDEDVHV HJ >7+'$  <DZV @  7KHVH H[WHQVLYH OLVWV DUH FRQ RQOLQH GDWDEDVHV HJ >7+'$  <DZV @  7KHVH H[WHQVLYH OLVWV DUH FRQ
VWDQWO\ FRPSOHPHQWHG DQG XSGDWHG E\ SXEOLFDWLRQV HJ >6KRFN  +HOJHVRQ  VWDQWO\ FRPSOHPHQWHG DQG XSGDWHG E\ SXEOLFDWLRQV HJ >6KRFN  +HOJHVRQ 
6KRFN .RUH]N\6KRFNHWDO@)XUWKHUPRUHWKHUPRG\QDPLFVRIWZDUH 6KRFN .RUH]N\6KRFNHWDO@)XUWKHUPRUHWKHUPRG\QDPLF VRIWZDUH
JHQHUDOO\SURYLGHVGDWDEDVHVZLWKH[WHQVLYHOLVWVRIHQWURSLHVDQGHQWKDOSLHVRIYDUL JHQHUDOO\SURYLGHVGDWDEDVHVZLWKH[WHQVLYHOLVWVRIHQWURSLHVDQGHQWKDOSLHVRIYDUL
RXV FKHPLFDO VSHFLHV UHIHUULQJ WR VWDQGDUG WH[WERRNV DQG SXEOLFDWLRQV HJ >2XNX RXV FKHPLFDO VSHFLHV UHIHUULQJ WR VWDQGDUG WH[WERRNV DQG SXEOLFDWLRQV HJ >2XNX
2XNX@DVXVHGLQWKHWKHRUHWLFDOSDUWRIWKLVSURMHFW 2XNX@DVXVHGLQWKHWKHRUHWLFDOSDUWRIWKLVSURMHFW
$FFRUGLQJWR>5RLQH@WKHUPRG\QDPLFGDWDRIFKHPLFDOVSHFLHVDOZD\VFRQWDLQV $FFRUGLQJWR>5RLQH@WKHUPRG\QDPLFGDWDRIFKHPLFDOVSHFLHVDOZD\VFRQWDLQV
FHUWDLQHUURUVZKLFKFDQKDYHDVLJQLILFDQWHIIHFWRQWKHUHVXOWVHVSHFLDOO\LIWKHGULY FHUWDLQHUURUVZKLFKFDQKDYHDVLJQLILFDQWHIIHFWRQWKHUHVXOWVHVSHFLDOO\LIWKHGULY
LQJIRUFHVRIWKHDVVRFLDWHGUHDFWLRQVDUHVPDOO6RLWLVRIWHQXVHIXOWRYHULI\WKHDS LQJIRUFHVRIWKHDVVRFLDWHGUHDFWLRQVDUHVPDOO6RLWLVRIWHQXVHIXOWRYHULI\WKHDS
SOLHGWKHUPRG\QDPLFGDWDZLWKRWKHUOLWHUDWXUH0RUHRYHULWVKRXOGEHQRWHGWKDWWKH SOLHGWKHUPRG\QDPLFGDWDZLWKRWKHUOLWHUDWXUH0RUHRYHULWVKRXOGEHQRWHGWKDWWKH
WKHUPRG\QDPLFGDWDEDVHRIµ+6&¶LVH[WHQVLYHEXWFHUWDLQO\QRWFRPSOHWH7KXVRI WKHUPRG\QDPLFGDWDEDVHRIµ+6&¶LVH[WHQVLYHEXWFHUWDLQO\QRWFRPSOHWH7KXVRI
WHQLWLVQHFHVVDU\WRDGGGDWDWRWKHµ+6&¶GDWDEDVH0RVWWKHUPRG\QDPLFGDWDPLVV WHQLWLVQHFHVVDU\WRDGGGDWDWRWKHµ+6&¶GDWDEDVH0RVWWKHUPRG\QDPLFGDWDPLVV

 

,QROGHUFKHPLVWU\OLWHUDWXUHWKH*LEEVHQHUJ\LVDOVRDEEUHYLDWHGE\ µ)¶ +RZHYHUµ*¶DVXVHGLQ ,QROGHUFKHPLVWU\OLWHUDWXUHWKH*LEEVHQHUJ\LVDOVRDEEUHYLDWHGE\ µ)¶ +RZHYHUµ*¶DVXVHGLQ
WKLVWKHVLVLVUHFRPPHQGHGLQ>,83$&@WRDYRLGFRQIXVLRQZLWKWKH+HOPKROW]IUHHHQHUJ\ WKLVWKHVLVLVUHFRPPHQGHGLQ>,83$&@WRDYRLGFRQIXVLRQZLWKWKH+HOPKROW]IUHHHQHUJ\
ZKLFKLVRIWHQDEEUHYLDWHGE\ µ)¶ LQSDUWLFXODULQSK\VLFV ZKLFKLVRIWHQDEEUHYLDWHGE\ µ)¶ LQSDUWLFXODULQSK\VLFV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$SSOLFDWLRQRI7KHUPRG\QDPLFV 7KHUPRG\QDPLF'DWD $SSOLFDWLRQRI7KHUPRG\QDPLFV 7KHUPRG\QDPLF'DWD

LQJLQµ+6&¶FDQEHIRXQGLQWKHOLWHUDWXUH DVGHVFULEHGDERYH EXWIRUVRPHVSHFLHV LQJLQµ+6&¶FDQEHIRXQGLQWKHOLWHUDWXUH DVGHVFULEHGDERYH EXWIRUVRPHVSHFLHV


WKDWZHFDPHDFURVVLQWKLVSURMHFWGDWDDSSHDUHGQRWWREHDYDLODEOH  WKDWZHFDPHDFURVVLQWKLVSURMHFWGDWDDSSHDUHGQRWWREHDYDLODEOH 
$VLQGLFDWHGLQ6HFWLRQWZRGLIIHUHQWVFDOHVIRUWKHUPRG\QDPLFGDWDH[LVWWKH $VLQGLFDWHGLQ6HFWLRQWZRGLIIHUHQWVFDOHVIRUWKHUPRG\QDPLFGDWDH[LVWWKH
GHOWDVFDOH>:DJPDQHWDO@DQGWKHDEVROXWHVFDOH>%DULQ@ 7KHGLIIHUHQW GHOWDVFDOH>:DJPDQHWDO@DQGWKHDEVROXWHVFDOH>%DULQ@ 7KHGLIIHUHQW
VFDOHV GR QRW LQWHUIHUH ZLWK WKH FDOFXODWLRQ RI µ¨*¶ YDOXHV RI UHDFWLRQV ZKLFK KDV VFDOHV GR QRW LQWHUIHUH ZLWK WKH FDOFXODWLRQ RI µ¨*¶ YDOXHV RI UHDFWLRQV ZKLFK KDV
EHHQ H[HPSOLILHG LQ 6HFWLRQ  +RZHYHU EHVLGHV WKH GLIIHUHQFH LQ WKH µ¨*I¶ EHHQ H[HPSOLILHG LQ 6HFWLRQ  +RZHYHU EHVLGHV WKH GLIIHUHQFH LQ WKH µ¨*I¶
GHOWDVFDOH DQGµ*I¶ DEVROXWHVFDOH YDOXHVRIVSHFLHV WKDWFDQFHOHDFKRWKHUGRZQ GHOWDVFDOH DQGµ*I¶ DEVROXWHVFDOH YDOXHVRIVSHFLHV WKDWFDQFHOHDFKRWKHUGRZQ
LQWKHFDOFXODWLRQRIµ¨*¶IRUUHDFWLRQV WKHGLYHUVHVFDOHVOHDGWRGLIIHUHQFHVLQWKH LQWKHFDOFXODWLRQRIµ¨*¶IRUUHDFWLRQV WKHGLYHUVHVFDOHVOHDGWRGLIIHUHQFHVLQWKH
GDWDEDVHHQWULHVIRUµ+¶DQGµ6¶µ+6&¶SURYLGHVDQRSWLRQIRURXWSXWLQERWKVFDOHV GDWDEDVHHQWULHVIRUµ+¶DQGµ6¶µ+6&¶SURYLGHVDQRSWLRQIRURXWSXWLQERWKVFDOHV
EXWLWVGDWDEDVHLVEDVHGRQWKHDEVROXWHVFDOH6RLIHQWULHVIURPDGHOWDVFDOHGDWD EXWLWVGDWDEDVHLVEDVHGRQWKHDEVROXWHVFDOH6RLIHQWULHVIURPDGHOWDVFDOHGDWD
EDVH HJ >:DJPDQ HWDO @  DUH WR EH LPSOHPHQWHG LQ µ+6&¶ WKH IROORZLQJ EDVH HJ >:DJPDQ HWDO @  DUH WR EH LPSOHPHQWHG LQ µ+6&¶ WKH IROORZLQJ
HTXDWLRQVDSSO\ HTXDWLRQVDSSO\

Δ+ = + ( VSHFLHV ) − ¦ + ( HOHPHQWV ) Δ+ = + ( VSHFLHV ) − ¦ + ( HOHPHQWV )


Δ6 = 6 ( VSHFLHV ) − ¦ 6 ( HOHPHQWV ) Δ6 = 6 ( VSHFLHV ) − ¦ 6 ( HOHPHQWV )
Δ* = * ( VSHFLHV ) − ¦ * ( HOHPHQWV )  >@ Δ* = * ( VSHFLHV ) − ¦ * ( HOHPHQWV )  >@

] ]
Δ* = * ( LRQV ) − ¦ * ( HOHPHQWV ) + × * ( + ) − ] × * ( ++ ) Δ* = * ( LRQV ) − ¦ * ( HOHPHQWV ) + × * ( + ) − ] × * ( ++ )
 
,WVKRXOGEHHPSKDVLVHGWKDWWKHPXWXDOVWDELOLW\RIFKHPLFDOVSHFLHVFDQQRWEHFRP ,WVKRXOGEHHPSKDVLVHGWKDWWKHPXWXDOVWDELOLW\RIFKHPLFDOVSHFLHVFDQQRWEHFRP
SDUHGEDVHGRQWKHHQWKDOS\LQHLWKHUVFDOH7KXVWKHFRQFHSWRIWKH*LEEVIUHHHQ SDUHGEDVHGRQWKHHQWKDOS\LQHLWKHUVFDOH7KXVWKHFRQFHSWRIWKH*LEEVIUHHHQ
HUJ\ DQG LWV DSSOLFDWLRQ LQ WHUPVRI µ¨*¶RU µ¨*I¶DVDPHDVXUHIRUWKHDIILQLW\RI HUJ\DQGLWVDSSOLFDWLRQ LQWHUPVRI µ¨*¶RU µ¨*I¶DVDPHDVXUHIRUWKHDIILQLW\RI
UHDFWLRQV DQG IRUPDWLRQ UHVSHFWLYHO\ LV FUXFLDO 7KHVH FRQFHSWV DUH DSSOLFDEOH IRU UHDFWLRQV DQG IRUPDWLRQ UHVSHFWLYHO\ LV FUXFLDO 7KHVH FRQFHSWV DUH DSSOLFDEOH IRU
V\VWHPVZKHUHWKHSURFHVVHVRFFXUXQGHUFRQVWDQWWHPSHUDWXUHDQGSUHVVXUHZKLFK V\VWHPVZKHUHWKHSURFHVVHVRFFXUXQGHUFRQVWDQWWHPSHUDWXUHDQGSUHVVXUHZKLFK
LVDFRPPRQDVVXPSWLRQLQFKHPLVWU\ LVDFRPPRQDVVXPSWLRQLQFKHPLVWU\
6\VWHPV ZLWK RWKHU VRFDOOHG QDWXUDO YDULDEOHV LH YDULDEOHV WKDW DUH DVVXPHG WR EH 6\VWHPV ZLWK RWKHU VRFDOOHG QDWXUDO YDULDEOHV LH YDULDEOHV WKDW DUH DVVXPHG WR EH
FRQVWDQWLQWKHSURFHVVUHTXLUHFRQVLGHUDWLRQVEDVHGRQRWKHUWKHUPRG\QDPLFSRWHQ FRQVWDQWLQWKHSURFHVVUHTXLUHFRQVLGHUDWLRQVEDVHGRQRWKHUWKHUPRG\QDPLFSRWHQ
WLDOV%HVLGHVµ*¶DQGµ+¶WKHPRVWLPSRUWDQWWKHUPRG\QDPLFSRWHQWLDOVDUHWKHLQWHU WLDOV%HVLGHVµ*¶DQGµ+¶WKHPRVWLPSRUWDQWWKHUPRG\QDPLFSRWHQWLDOVDUHWKHLQWHU
QDO HQHUJ\ µ8¶  ZLWK µ6¶ DQG YROXPH DV QDWXUDO YDULDEOHV  DQG WKH +HOPKROW] IUHH QDO HQHUJ\ µ8¶  ZLWK µ6¶ DQG YROXPH DV QDWXUDO YDULDEOHV  DQG WKH +HOPKROW] IUHH
HQHUJ\ µ$¶ ‚ ZLWKµ7¶DQGYROXPHDVQDWXUDOYDULDEOHV 7KHWKHRUHWLFDOEDFNJURXQG HQHUJ\ µ$¶ ‚ ZLWKµ7¶DQGYROXPHDVQDWXUDOYDULDEOHV 7KHWKHRUHWLFDOEDFNJURXQG
RIWKHVHSRWHQWLDOVLVQRWUHOHYDQWIRUWKHSXUSRVHRIWKLVWKHVLV:LWKUHJDUGWRWKHUH RIWKHVHSRWHQWLDOVLVQRWUHOHYDQWIRUWKHSXUSRVHRIWKLVWKHVLV:LWKUHJDUGWRWKHUH
ODWLRQVKLSV EHWZHHQ WKHVH LPSRUWDQW WKHUPRG\QDPLF SRWHQWLDOV WKH RIWHQ FLWHG PQH ODWLRQVKLSV EHWZHHQ WKHVH LPSRUWDQW WKHUPRG\QDPLF SRWHQWLDOV WKH RIWHQ FLWHG PQH
PRQLFGLDJUDPLQ)LJXUHFDQEHXVHIXO PRQLFGLDJUDPLQ)LJXUHFDQEHXVHIXO

 

)RUJHQHUDOLQYHVWLJDWLRQVUHODWHGWRDTXHRXVPHWDOOLFFRUURVLRQLHµ0H¶+2V\VWHPVRUµ0H¶ )RUJHQHUDOLQYHVWLJDWLRQVUHODWHGWRDTXHRXVPHWDOOLFFRUURVLRQLHµ0H¶+2V\VWHPVRUµ0H¶
µ0H¶«µ0H]¶+2V\VWHPVGDWDIRUUHOHYDQWVSHFLHVLVJHQHUDOO\LQFOXGHGLQµ+6&¶RUFDQEHRE µ0H¶«µ0H]¶+2V\VWHPVGDWDIRUUHOHYDQWVSHFLHVLVJHQHUDOO\LQFOXGHGLQµ+6&¶RUFDQEHRE
WDLQHGIURPRWKHUVRXUFHV FI6HFWLRQ )RUV\VWHPVLQYROYLQJYDULRXVQRQPHWDOOLFHOHPHQWV WDLQHGIURPRWKHUVRXUFHV FI6HFWLRQ )RUV\VWHPVLQYROYLQJYDULRXVQRQPHWDOOLFHOHPHQWV
DORQHRULQFRPELQDWLRQZLWKPHWDOVWKHUPRG\QDPLFGDWDLVRIWHQQRWDYDLODEOH+RZHYHUDVZLOOEH DORQHRULQFRPELQDWLRQZLWKPHWDOVWKHUPRG\QDPLFGDWDLVRIWHQQRWDYDLODEOH+RZHYHUDVZLOOEH
GHVFULEHGLQPRUHGHWDLOLQ6HFWLRQWKHVHFRQVLGHUDWLRQVDQGWKHDVVRFLDWHGµ0(3'V¶DUHQRW GHVFULEHGLQPRUHGHWDLOLQ6HFWLRQWKHVHFRQVLGHUDWLRQVDQGWKHDVVRFLDWHGµ0(3'V¶DUHQRW
LQFOXGHGLQWKHSUHVHQWWKHVLVGXHWRWKHH[SHFWHGSDWHQWSRVVLELOLWLHV FI6HFWLRQ  LQFOXGHGLQWKHSUHVHQWWKHVLVGXHWRWKHH[SHFWHGSDWHQWSRVVLELOLWLHV FI6HFWLRQ 
‚ ‚
,83$&UHFRPPHQGVWKHV\PERO µ$¶ IRUWKH+HOPKROW]IUHHHQHUJ\WRDYRLGFRQIXVLRQZLWKWKH ,83$&UHFRPPHQGVWKHV\PERO µ$¶ IRUWKH+HOPKROW]IUHHHQHUJ\WRDYRLGFRQIXVLRQZLWKWKH
*LEEVIUHHHQHUJ\+RZHYHUWKHDEEUHYLDWLRQ µ)¶ LVLQIUHTXHQWXVHLQSDUWLFXODULQSK\VLFV *LEEVIUHHHQHUJ\+RZHYHUWKHDEEUHYLDWLRQ µ)¶ LVLQIUHTXHQWXVHLQSDUWLFXODULQSK\VLFV

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHUPRG\QDPLF'DWD $SSOLFDWLRQRI7KHUPRG\QDPLFV 7KHUPRG\QDPLF'DWD $SSOLFDWLRQRI7KHUPRG\QDPLFV

 
)LJXUH 5HODWLRQVKLS EHWZHHQ WKH IRXU WKHUPRG\QDPLF SRWHQWLDOV LQWHUQDO HQ )LJXUH 5HODWLRQVKLS EHWZHHQ WKH IRXU WKHUPRG\QDPLF SRWHQWLDOV LQWHUQDO HQ
HUJ\ µ8¶ +HOPKROW]IUHH HQHUJ\ µ$¶  HQWKDOS\ µ+¶ DQG *LEEVIUHH HUJ\ µ8¶ +HOPKROW]IUHH HQHUJ\ µ$¶  HQWKDOS\ µ+¶ DQG *LEEVIUHH
HQHUJ\µ*¶H[SUHVVHGE\RIIVHWVRIWKHHQHUJ\IURPWKHHQYLURQPHQWLH HQHUJ\µ*¶H[SUHVVHGE\RIIVHWVRIWKHHQHUJ\IURPWKHHQYLURQPHQWLH
WKH SURGXFW µ7¶×µ6¶ DQG WKH H[SDQVLRQ ZRUN LH WKH SURGXFW WKH SURGXFW µ7¶×µ6¶ DQG WKH H[SDQVLRQ ZRUN LH WKH SURGXFW
µ3¶ × µ9¶ $IWHU>6FKURHGHU@ µ3¶ × µ9¶ $IWHU>6FKURHGHU@
)RU D GHWDLOHG GHVFULSWLRQ RI WKH UHODWLRQVKLSV EHWZHHQ DQG WKH EDFNJURXQG RI WKHVH )RU D GHWDLOHG GHVFULSWLRQ RI WKH UHODWLRQVKLSV EHWZHHQ DQG WKH EDFNJURXQG RI WKHVH
WKHUPRG\QDPLF SRWHQWLDOV UHIHUHQFH LV PDGH WR HJ >)UHLHVOHEHQ+DQVHQ  WKHUPRG\QDPLF SRWHQWLDOV UHIHUHQFH LV PDGH WR HJ >)UHLHVOHEHQ+DQVHQ 
6FKURHGHU0¡OOHUD*68@ 6FKURHGHU0¡OOHUD*68@
%DVHG RQ WKH DERYH WKH GHYLDWLRQV GHWHUPLQHG EHWZHHQ WKH FDOFXODWHG µ(¶ YDOXHV %DVHG RQ WKH DERYH WKH GHYLDWLRQV GHWHUPLQHG EHWZHHQ WKH FDOFXODWHG µ(¶ YDOXHV
DQGWKHRQHVFLWHGIURPWKHOLWHUDWXUH>-RQHV@IRUVRPHRIWKHKDOIFHOOUHDFWLRQV DQGWKHRQHVFLWHGIURPWKHOLWHUDWXUH>-RQHV@IRUVRPHRIWKHKDOIFHOOUHDFWLRQV
PHQWLRQHGWKURXJKRXWWKLVWKHVLVDUHEULHIO\DQDO\VHGLQWKHIROORZLQJ PHQWLRQHGWKURXJKRXWWKLVWKHVLVDUHEULHIO\DQDO\VHGLQWKHIROORZLQJ
7KHIUHTXHQWO\VWDWHGKDOIFHOOUHDFWLRQGHVFULELQJWKHUHGXFWLRQRIIHUURXVLRQ 7KHIUHTXHQWO\VWDWHGKDOIFHOOUHDFWLRQGHVFULELQJWKHUHGXFWLRQRIIHUURXVLRQ

)H → )H + + H− (( 
 = −  {} P96+( )  >@ )H → )H + + H− (( 
 = −  {} P96+( )  >@

LVFKRVHQIRUWKDWSXUSRVH7KHDQDO\VLVLVEDVHGRQDFRPSDULVRQRIWKHµ(¶FDOFX LVFKRVHQIRUWKDWSXUSRVH7KHDQDO\VLVLVEDVHGRQDFRPSDULVRQRIWKHµ(¶FDOFX
ODWHGEDVHGRQWKHWKHUPRG\QDPLFGDWDSURYLGHGLQ>:DJPDQHWDO@ZKLFKFRU ODWHGEDVHGRQWKHWKHUPRG\QDPLFGDWDSURYLGHGLQ>:DJPDQHWDO@ZKLFKFRU
UHVSRQGV WR WKH GDWD SURYLGHG LQ WKH µ+6&¶ GDWDEDVH WKH WKHUPRG\QDPLF GDWD IURP UHVSRQGV WR WKH GDWD SURYLGHG LQ WKH µ+6&¶ GDWDEDVH WKH WKHUPRG\QDPLF GDWD IURP
>)UHLHVOHEHQ+DQVHQ@DQGWKHGDWDSURYLGHGLQ>3RXUEDL[E@DVZHOODVLQ >)UHLHVOHEHQ+DQVHQ@DQGWKHGDWDSURYLGHGLQ>3RXUEDL[E@DVZHOODVLQ
>-RQHV@VHH7DEOH >-RQHV@VHH7DEOH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$SSOLFDWLRQRI7KHUPRG\QDPLFV 7KHUPRG\QDPLF'DWD $SSOLFDWLRQRI7KHUPRG\QDPLFV 7KHUPRG\QDPLF'DWD

7DEOH 7KHUPRG\QDPLFGDWD GHOWDVFDOH RIIHUURXVLRQIURPWKHµ+6&¶ GDWD 7DEOH 7KHUPRG\QDPLFGDWD GHOWDVFDOH RIIHUURXVLRQIURPWKHµ+6&¶ GDWD
EDVH>:DJPDQHWDO@DQGIURP>)UHLHVOHEHQ+DQVHQ@ZLWK EDVH>:DJPDQHWDO@DQGIURP>)UHLHVOHEHQ+DQVHQ@ZLWK
µ¨*¶ DQG µ(¶ IRU UHGXFWLRQ RI IHUURXV LRQ FDOFXODWHG RQ WKDW EDVLV µ¨*¶ DQG µ(¶ IRU UHGXFWLRQ RI IHUURXV LRQ FDOFXODWHG RQ WKDW EDVLV
µ¨*I¶IURP>3RXUEDL[E@ZLWKµ¨*¶DQGµ(¶IRUUHGXFWLRQRIIHU µ¨*I¶IURP>3RXUEDL[E@ZLWKµ¨*¶DQGµ(¶IRUUHGXFWLRQRIIHU
URXV LRQ FDOFXODWHG RQ WKDW EDVLV DQG µ(¶ DV VSHFLILHG E\ >-RQHV URXV LRQ FDOFXODWHG RQ WKDW EDVLV DQG µ(¶ DV VSHFLILHG E\ >-RQHV
@DQGRWKHUOLWHUDWXUH  @DQGRWKHUOLWHUDWXUH 

)H )H
+ − + −
)H + H → )H  )H + H → )H 
µ¨+¶ µ¨6¶ µ¨*I¶ µ¨*¶ µ(¶ 6RXUFH µ¨+¶ µ¨6¶ µ¨*I¶ µ¨*¶ µ(¶ 6RXUFH
N-PRO - PRO×.  N-PRO N- P9 N-PRO - PRO×.  N-PRO N- P9
í í í  í >:DJPDQHWDO@ í í í  í >:DJPDQHWDO@
í í í  í >)UHLHVOHEHQ+DQVHQ@ í í í  í >)UHLHVOHEHQ+DQVHQ@
  í  í >3RXUEDL[E@   í  í >3RXUEDL[E@
    í >-RQHV@     í >-RQHV@
 
,WFDQEHREVHUYHGWKDWWKHUHLVTXLWHDODUJHGLVFUHSDQF\EHWZHHQWKHYDOXHVIRUµ¨+¶ ,WFDQEHREVHUYHGWKDWWKHUHLVTXLWHDODUJHGLVFUHSDQF\EHWZHHQWKHYDOXHVIRUµ¨+¶
DQG HVSHFLDOO\ IRU µ¨6¶ VSHFLILHG LQ >:DJPDQ HWDO @ DQG LQ DQG HVSHFLDOO\ IRU µ¨6¶ VSHFLILHG LQ >:DJPDQ HWDO @ DQG LQ
>)UHLHVOHEHQ+DQVHQ @ 7KHVH YDOXHV OHDG WR D FRQVLGHUDEOH GLIIHUHQFH LQ µ¨*¶ >)UHLHVOHEHQ+DQVHQ @ 7KHVH YDOXHV OHDG WR D FRQVLGHUDEOH GLIIHUHQFH LQ µ¨*¶
IRUWKHUHGXFWLRQRIIHUURXVLRQDQGDFFRUGLQJO\IRUµ(¶7KHµ(¶FDOFXODWHGEDVHG IRUWKHUHGXFWLRQRIIHUURXVLRQDQGDFFRUGLQJO\IRUµ(¶7KHµ(¶FDOFXODWHGEDVHG
RQWKHGDWDIURP>:DJPDQHWDO@LVP9ORZHUDQGWKHµ(¶FDOFXODWHGEDVHG RQWKHGDWDIURP>:DJPDQHWDO@LVP9ORZHUDQGWKHµ(¶FDOFXODWHGEDVHG
RQWKHGDWDIURP>)UHLHVOHEHQ+DQVHQ@LVP9KLJKHUWKDQWKHYDOXHJLYHQLQ RQWKHGDWDIURP>)UHLHVOHEHQ+DQVHQ@LVP9KLJKHUWKDQWKHYDOXHJLYHQLQ
>-RQHV@DQGPRVWRWKHUOLWHUDWXUH:HWKLQNWKDWWKHVHGHYLDWLRQVPLJKWEHGXHWR >-RQHV@DQGPRVWRWKHUOLWHUDWXUH:HWKLQNWKDWWKHVHGHYLDWLRQVPLJKWEHGXHWR
WKHWZRR[LGDWLRQVWDWHVRILURQDQGWKHIDFWWKDWIHUURXVLRQLVHDVLO\R[LGLVHGWRIHUULF WKHWZRR[LGDWLRQVWDWHVRILURQDQGWKHIDFWWKDWIHUURXVLRQLVHDVLO\R[LGLVHGWRIHUULF
LRQVRWKDWERWKWKHPHDVXUHPHQWRIµ+¶µ6¶DQGµ&S¶DQGWKHGLUHFWPHDVXUHPHQWRI LRQVRWKDWERWKWKHPHDVXUHPHQWRIµ+¶µ6¶DQGµ&S¶DQGWKHGLUHFWPHDVXUHPHQWRI
WKHHTXLOLEULXPSRWHQWLDOFRXOGEHDIIHFWHGE\LPSXULWLHV 'LVUHJDUGLQJWKHSUREDEOH WKHHTXLOLEULXPSRWHQWLDOFRXOGEHDIIHFWHGE\LPSXULWLHV 'LVUHJDUGLQJWKHSUREDEOH
LQVLJQLILFDQFHLQSUDFWLFHWKHGHYLDWLRQLVUDWKHUKLJKIURPDWKHRUHWLFDOSRLQWRIYLHZ LQVLJQLILFDQFHLQSUDFWLFHWKHGHYLDWLRQLVUDWKHUKLJKIURPDWKHRUHWLFDOSRLQWRIYLHZ
DQGZHVXJJHVWWKDWLWLVZRUWKWREHIXUWKHULQYHVWLJDWHGLQWKHIXWXUH DQGZHVXJJHVWWKDWLWLVZRUWKWREHIXUWKHULQYHVWLJDWHGLQWKHIXWXUH
7KHµ(¶FDOFXODWHGEDVHGRQWKHµ¨*I¶WDNHQIURP>3RXUEDL[E@ZKLFKLVEDVHG 7KHµ(¶FDOFXODWHGEDVHGRQWKHµ¨*I¶WDNHQIURP>3RXUEDL[E@ZKLFKLVEDVHG
RQDVHHPLQJO\URXQGHGYDOXHRIWKHFKHPLFDOVWDQGDUGSRWHQWLDOVSHFLILHGIRUIHUURXV RQDVHHPLQJO\URXQGHGYDOXHRIWKHFKHPLFDOVWDQGDUGSRWHQWLDOVSHFLILHGIRUIHUURXV
LRQLQFDORULHVLVWKHFORVHVWPDWFKWRWKHYDOXHVSHFLILHGE\>-RQHV@+RZHYHU LRQLQFDORULHVLVWKHFORVHVWPDWFKWRWKHYDOXHVSHFLILHGE\>-RQHV@+RZHYHU
LW LV XQFOHDU LI WKH QXPHULFDO YDOXH IRU µ¨*I¶ LQ >3RXUEDL[ E@ ZDV GHWHUPLQHG LW LV XQFOHDU LI WKH QXPHULFDO YDOXH IRU µ¨*I¶ LQ >3RXUEDL[ E@ ZDV GHWHUPLQHG
EDVHGRQGLIIHUHQWµ+¶DQGµ6¶YDOXHVRUEDVHGRQDJLYHQµ(¶0RUHRYHUWKHRULJLQDO EDVHGRQGLIIHUHQWµ+¶DQGµ6¶YDOXHVRUEDVHGRQDJLYHQµ(¶0RUHRYHUWKHRULJLQDO
VRXUFHRIWKHµ(¶IRUWKHUHGXFWLRQRIIHUURXVLRQLVXQNQRZQ VRXUFHRIWKHµ(¶IRUWKHUHGXFWLRQRIIHUURXVLRQLVXQNQRZQ
+HQFH ZH GHFLGHG WR EDVH RXU FRQVLGHUDWLRQV IRU IHUURXV LRQ DQG RWKHU VSHFLHV IRU +HQFH ZH GHFLGHG WR EDVH RXU FRQVLGHUDWLRQV IRU IHUURXV LRQ DQG RWKHU VSHFLHV IRU
ZKLFK OLPLWHG GLVFUHSDQFLHV EHWZHHQ WKH FDOFXODWHG DQG OLWHUDWXUH YDOXHV ZHUH RE ZKLFK OLPLWHG GLVFUHSDQFLHV EHWZHHQ WKH FDOFXODWHG DQG OLWHUDWXUH YDOXHV ZHUH RE
VHUYHGRQ>:DJPDQHWDO@7KHWKHUPRG\QDPLFGDWDRI)HLQ>:DJPDQHWDO VHUYHGRQ>:DJPDQHWDO@7KHWKHUPRG\QDPLFGDWDRI)HLQ>:DJPDQHWDO
@ ZDV DOVR FRQILUPHG E\ >6KRFN HWDO @ DQG DFFRUGLQJ WR >*XUYLFK @ @ ZDV DOVR FRQILUPHG E\ >6KRFN HWDO @ DQG DFFRUGLQJ WR >*XUYLFK @
WKH LQIRUPDWLRQ SURYLGHG LQ >:DJPDQ HWDO @ ZKLFK LV DOVR UHIHUUHG WR DV WKH WKH LQIRUPDWLRQ SURYLGHG LQ >:DJPDQ HWDO @ ZKLFK LV DOVR UHIHUUHG WR DV WKH
 

µ¨*¶FRUUHVSRQGVWRµ¨*I¶ LQWKHGHOWDVFDOH IRUWKLVKDOIFHOOUHDFWLRQDVWKHµ¨*I¶IRU)HLVN- µ¨*¶FRUUHVSRQGVWRµ¨*I¶ LQWKHGHOWDVFDOH IRUWKLVKDOIFHOOUHDFWLRQDVWKHµ¨*I¶IRU)HLVN-

7KLVLVQRWWUXHIRUWKHQRUPDOVFDOH:HFRQVLGHUWKLVFRUUHVSRQGHQFHWREHDIXUWKHUEHQHILWRIWKH 7KLVLVQRWWUXHIRUWKHQRUPDOVFDOH:HFRQVLGHUWKLVFRUUHVSRQGHQFHWREHDIXUWKHUEHQHILWRIWKH
GHOWDVFDOHEXWRIFRXUVHµ¨*¶DQGµ¨*I¶GLIIHULIRWKHUVSHFLHVDUHLQYROYHGLQDKDOIFHOOUHDFWLRQ GHOWDVFDOHEXWRIFRXUVHµ¨*¶DQGµ¨*I¶GLIIHULIRWKHUVSHFLHVDUHLQYROYHGLQDKDOIFHOOUHDFWLRQ
HJ+2+RU2+í HJ+2+RU2+í

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV

³1%6 7DEOHV´LVUHFRPPHQGHGE\,83$&DVWKHVWDQGDUGVRXUFHRIWKHUPRG\QDPLF ³1%6 7DEOHV´LVUHFRPPHQGHGE\,83$&DVWKHVWDQGDUGVRXUFHRIWKHUPRG\QDPLF


GDWD GDWD

 3RXUEDL['LDJUDP  3RXUEDL['LDJUDP


:HFRQVLGHUWKH3RXUEDL[GLDJUDPWREHRISDUWLFXODUEHQHILWLQGHVFULELQJ DQGSUH :HFRQVLGHUWKH3RXUEDL[GLDJUDPWREHRISDUWLFXODUEHQHILWLQGHVFULELQJ DQGSUH
GLFWLQJWKHFKDUDFWHULVWLFVRIDV\VWHPVLQFHLWSURYLGHVDQLQVLJKWIXOUHSUHVHQWDWLRQRI GLFWLQJWKHFKDUDFWHULVWLFVRIDV\VWHPVLQFHLWSURYLGHVDQLQVLJKWIXOUHSUHVHQWDWLRQRI
LWV WKHUPRG\QDPLF VWDWHV +RZHYHU 3RXUEDL[ GLDJUDPV RQO\ UHSUHVHQW WKH DFWXDO LWV WKHUPRG\QDPLF VWDWHV +RZHYHU 3RXUEDL[ GLDJUDPV RQO\ UHSUHVHQW WKH DFWXDO
WKHUPRG\QDPLF FRQGLWLRQV RI D V\VWHP LI GXH UHJDUG LV JLYHQ WR WKH FKRLFH RI HOH WKHUPRG\QDPLF FRQGLWLRQV RI D V\VWHP LI GXH UHJDUG LV JLYHQ WR WKH FKRLFH RI HOH
PHQWV WKH DVVRFLDWHG LRQ DFWLYLWLHV DQG WKH SUHVHOHFWLRQ RI WKH FKHPLFDO VSHFLHV PHQWV WKH DVVRFLDWHG LRQ DFWLYLWLHV DQG WKH SUHVHOHFWLRQ RI WKH FKHPLFDO VSHFLHV
ZKLFKDUHNQRZQRUSRVWXODWHGWRH[LVWLQWKHV\VWHPXQGHULQYHVWLJDWLRQ,IWKHVHSUH ZKLFKDUHNQRZQRUSRVWXODWHGWRH[LVWLQWKHV\VWHPXQGHULQYHVWLJDWLRQ,IWKHVHSUH
VXPSWLRQVGRQRWDJUHHZLWKDFWXDOFRQGLWLRQVRIWKHV\VWHPXQGHULQYHVWLJDWLRQFRQ VXPSWLRQVGRQRWDJUHHZLWKDFWXDOFRQGLWLRQVRIWKHV\VWHPXQGHULQYHVWLJDWLRQFRQ
FOXVLRQV EDVHG RQ WKH 3RXUEDL[ GLDJUDP DUH LQDGHTXDWH DQG FDQ EH H[WUHPHO\ PLV FOXVLRQV EDVHG RQ WKH 3RXUEDL[ GLDJUDP DUH LQDGHTXDWH DQG FDQ EH H[WUHPHO\ PLV
OHDGLQJ 7DNLQJ LQWR DFFRXQW WKH UDWKHU FRPSOH[ FKHPLVWU\ RI WKH FRQFUHWH HQYLURQ OHDGLQJ 7DNLQJ LQWR DFFRXQW WKH UDWKHU FRPSOH[ FKHPLVWU\ RI WKH FRQFUHWH HQYLURQ
PHQWWKHOLPLWHGDSSOLFDWLRQRIWKH3RXUEDL[GLDJUDPLQWKLVDUHDPLJKWEHH[SODLQHG PHQWWKHOLPLWHGDSSOLFDWLRQRIWKH3RXUEDL[GLDJUDPLQWKLVDUHDPLJKWEHH[SODLQHG
,QWKLV6HFWLRQWKHSURSRVHGZD\RIHVWDEOLVKLQJDQGXVLQJDSSURSULDWHDQGUHSUHVHQWD ,QWKLV6HFWLRQWKHSURSRVHGZD\RIHVWDEOLVKLQJDQGXVLQJDSSURSULDWHDQGUHSUHVHQWD
WLYH3RXUEDL[GLDJUDPVIRUWKHGHVFULSWLRQRIUHLQIRUFHPHQWFRUURVLRQPHFKDQLVPV FI WLYH3RXUEDL[GLDJUDPVIRUWKHGHVFULSWLRQRIUHLQIRUFHPHQWFRUURVLRQPHFKDQLVPV FI
&KDSWHU DVZHOODVWKHHYDOXDWLRQRIDYDLODEOHDQGWKHGHVLJQRIQHZFRXQWHUPHD &KDSWHU DVZHOODVWKHHYDOXDWLRQRIDYDLODEOHDQGWKHGHVLJQRIQHZFRXQWHUPHD
VXUHV FI &KDSWHUV  DQG  UHVSHFWLYHO\  LV UHDVRQHG 6HFWLRQ  SURYLGHV VRPH VXUHV FI &KDSWHUV  DQG  UHVSHFWLYHO\  LV UHDVRQHG 6HFWLRQ  SURYLGHV VRPH
JHQHUDO QRWHV RQ RXU WKHUPRG\QDPLF SUHVXPSWLRQV DQG DSSOLFDWLRQV FRQFHUQLQJ WKH JHQHUDO QRWHV RQ RXU WKHUPRG\QDPLF SUHVXPSWLRQV DQG DSSOLFDWLRQV FRQFHUQLQJ WKH
3RXUEDL[GLDJUDP6HFWLRQIRFXVHVRQWKHDSSOLFDELOLW\LQWKHDUHDRIUHLQIRUFH 3RXUEDL[GLDJUDP6HFWLRQIRFXVHVRQWKHDSSOLFDELOLW\LQWKHDUHDRIUHLQIRUFH
PHQWFRUURVLRQ PHQWFRUURVLRQ

 (VWDEOLVKPHQWDQG$SSOLFDWLRQRI3RXUEDL['LDJUDPV  (VWDEOLVKPHQWDQG$SSOLFDWLRQRI3RXUEDL['LDJUDPV


7UDGLWLRQDOO\ 3RXUEDL[ GLDJUDPV KDYH EHHQ REWDLQHG IURP WKH OLWHUDWXUH DQG PDQ\ 7UDGLWLRQDOO\ 3RXUEDL[ GLDJUDPV KDYH EHHQ REWDLQHG IURP WKH OLWHUDWXUH DQG PDQ\
FRUURVLRQ VFLHQFH WH[WERRNVWKDWGHDOZLWK UHODWHGVXEMHFWV FLWHWKHGLDJUDPVDVWKH\ FRUURVLRQ VFLHQFH WH[WERRNVWKDWGHDOZLWK UHODWHGVXEMHFWV FLWHWKHGLDJUDPVDVWKH\
KDYH EHHQ RULJLQDOO\ HVWDEOLVKHG DQG SXEOLVKHG E\ 3RXUEDL[ DQG KLV FROOHDJXHV DW KDYH EHHQ RULJLQDOO\ HVWDEOLVKHG DQG SXEOLVKHG E\ 3RXUEDL[ DQG KLV FROOHDJXHV DW
&(%(/&25‚DVWKH HVVHQWLDOSDUWRIWKH IDPRXV ³$WODVRI(OHFWURFKHPLFDO (TXLOLE &(%(/&25‚DVWKH HVVHQWLDOSDUWRIWKH IDPRXV ³$WODVRI(OHFWURFKHPLFDO (TXLOLE
ULD´ >3RXUEDL[ E@ ZKLFK ZDV ILUVW SXEOLVKHG DV DQ (QJOLVK HGLWLRQ LQ  ULD´ >3RXUEDL[ E@ ZKLFK ZDV ILUVW SXEOLVKHG DV DQ (QJOLVK HGLWLRQ LQ 
0RUHRYHU3RXUEDL[DOVRSXEOLVKHGDQH[WHQGHGSDSHUGHDOLQJZLWK³$SSOLFDWLRQVRI 0RUHRYHU3RXUEDL[DOVRSXEOLVKHGDQH[WHQGHGSDSHUGHDOLQJZLWK ³$SSOLFDWLRQVRI
HOHFWURFKHPLVWU\LQFRUURVLRQVFLHQFHDQGSUDFWLFH´>3RXUEDL[D@ZKHUHYDULRXV HOHFWURFKHPLVWU\LQFRUURVLRQVFLHQFHDQGSUDFWLFH´>3RXUEDL[D@ZKHUHYDULRXV
DSSOLFDWLRQVRIWKHUPRG\QDPLFVDUHUHYLHZHG LQFOXGLQJDVKRUWQRWHRQUHLQIRUFHPHQW DSSOLFDWLRQVRIWKHUPRG\QDPLFVDUHUHYLHZHG LQFOXGLQJDVKRUWQRWHRQUHLQIRUFHPHQW
FRUURVLRQFI&KDSWHU +RZHYHUWKH3RXUEDL[GLDJUDPVSURYLGHGLQWKHVHRULJLQDO FRUURVLRQFI&KDSWHU +RZHYHUWKH3RXUEDL[GLDJUDPVSURYLGHGLQWKHVHRULJLQDO
SXEOLFDWLRQVDQGKHQFHLQWKHOLWHUDWXUHUHIHUULQJWRLWDUHJHQHUDOO\OLPLWHGWRDVLQ SXEOLFDWLRQVDQGKHQFHLQWKHOLWHUDWXUHUHIHUULQJWRLWDUHJHQHUDOO\OLPLWHGWRDVLQ
JOHHOHPHQWLQDQDTXHRXVV\VWHPLHDQµ(O¶+2V\VWHPDWVWDQGDUGVWDWHWHPSHUD JOHHOHPHQWLQDQDTXHRXVV\VWHPLHDQµ(O¶+2V\VWHPDWVWDQGDUGVWDWHWHPSHUD
WXUHDQGSUHVVXUH WXUHDQGSUHVVXUH

 

1DWLRQDO,QVWLWXWHRI6WDQGDUGVDQG7HFKQRORJ\ 1,67 IRUPHUO\NQRZQDVWKH1DWLRQDO%XUHDXRI 1DWLRQDO,QVWLWXWHRI6WDQGDUGVDQG7HFKQRORJ\ 1,67 IRUPHUO\NQRZQDVWKH1DWLRQDO%XUHDXRI
6WDQGDUGV 1%6 *DLWKHUVEXUJ0'86$ 6WDQGDUGV 1%6 *DLWKHUVEXUJ0'86$
‚ ‚
&HQWUH%HOJHG¶eWXGHGHOD&RUURVLRQ &(%(/&25 %HOJLDQ&HQWUHIRU&RUURVLRQ6WXG\:DWHUORR &HQWUH%HOJHG¶eWXGHGHOD&RUURVLRQ &(%(/&25 %HOJLDQ&HQWUHIRU&RUURVLRQ6WXG\:DWHUORR
%HOJLXP %HOJLXP

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP

$VGHVFULEHGLQ6HFWLRQWKHWHPSHUDWXUHKDVDVLJQLILFDQWHIIHFWRQWKHWKHUPR $VGHVFULEHGLQ6HFWLRQWKHWHPSHUDWXUHKDVDVLJQLILFDQWHIIHFWRQWKHWKHUPR
G\QDPLFV DQG WKH NLQHWLFV RI FRUURVLRQ SURFHVVHV DQG YDULDWLRQV LQ µS+¶ DQG µS2¶ G\QDPLFV DQG WKH NLQHWLFV RI FRUURVLRQ SURFHVVHV DQG YDULDWLRQV LQ µS+¶ DQG µS2¶
KDYH DQ LPSRUWDQW LQIOXHQFH RQ FDWKRGLF UHDFWLRQV FI 6HFWLRQ   +RZHYHU KDYH DQ LPSRUWDQW LQIOXHQFH RQ FDWKRGLF UHDFWLRQV FI 6HFWLRQ   +RZHYHU
EHLQJDZDUHRIWKHWHPSHUDWXUHDQGWKHSUHVVXUHHIIHFWDQGWDNLQJWKHLULQIOXHQFHLQWR EHLQJDZDUHRIWKHWHPSHUDWXUHDQGWKHSUHVVXUHHIIHFWDQGWDNLQJWKHLULQIOXHQFHLQWR
DFFRXQW LQ SDUWLFXODU LQ WKH GHVLJQ RI QHZ FRXQWHUPHDVXUHV  ZH WKLQN WKDW WKH PRVW DFFRXQW LQ SDUWLFXODU LQ WKH GHVLJQ RI QHZ FRXQWHUPHDVXUHV  ZH WKLQN WKDW WKH PRVW
FULWLFDO DVSHFW LQ H[LVWLQJ 3RXUEDL[ GLDJUDPV LV WKH OLPLWDWLRQ WR µ(O¶+2 V\VWHPV FULWLFDO DVSHFW LQ H[LVWLQJ 3RXUEDL[ GLDJUDPV LV WKH OLPLWDWLRQ WR µ(O¶+2 V\VWHPV
3RXUEDL[GLDJUDPVFRYHULQJRQO\RQHHOHPHQWFDQEHXVHIXOEXWOLPLWDWLRQVDSSO\LI 3RXUEDL[GLDJUDPVFRYHULQJRQO\RQHHOHPHQWFDQEHXVHIXOEXWOLPLWDWLRQVDSSO\LI
RQH RU PRUH FKHPLFDO VSHFLHV SUHVHQW LQ WKH V\VWHP XQGHU LQYHVWLJDWLRQ DIIHFW LWV RQH RU PRUH FKHPLFDO VSHFLHV SUHVHQW LQ WKH V\VWHP XQGHU LQYHVWLJDWLRQ DIIHFW LWV
WKHUPRG\QDPLFFRQGLWLRQVDQGKHQFHDOWHUWKHHOHFWURFKHPLVWU\RIWKHV\VWHPZKLFK WKHUPRG\QDPLFFRQGLWLRQVDQGKHQFHDOWHUWKHHOHFWURFKHPLVWU\RIWKHV\VWHPZKLFK
LV RI SDUWLFXODU LPSRUWDQFH LQ D V\VWHP DV FKHPLFDOO\ FRPSOH[ DV WKH FRQFUHWHVWHHO LV RI SDUWLFXODU LPSRUWDQFH LQ D V\VWHP DV FKHPLFDOO\ FRPSOH[ DV WKH FRQFUHWHVWHHO
V\VWHP FI6HFWLRQ 6RFXVWRPPDGH3RXUEDL[GLDJUDPVDUHQHFHVVDU\LIDFRP V\VWHP FI6HFWLRQ 6RFXVWRPPDGH3RXUEDL[GLDJUDPVDUHQHFHVVDU\LIDFRP
SOH[FKHPLFDOV\VWHPDVHJDFRQFUHWHPHWDOV\VWHPLVWREHLQYHVWLJDWHG$OVRRI SOH[FKHPLFDOV\VWHPDVHJDFRQFUHWHPHWDOV\VWHPLVWREHLQYHVWLJDWHG$OVRRI
WHQWKHFRPELQDWLRQRIWZRRUPRUHPHWDOVHJJDOYDQLFFRXSOLQJLVWREHDQDO\VHG WHQWKHFRPELQDWLRQRIWZRRUPRUHPHWDOVHJJDOYDQLFFRXSOLQJLVWREHDQDO\VHG
$VDIXQGDPHQWDODQGFHQWUDOWDVNLQWKLVSURMHFWZHKDYHGHYLVHGDQGWHVWHGSULQFL $VDIXQGDPHQWDODQGFHQWUDOWDVNLQWKLVSURMHFWZHKDYHGHYLVHGDQGWHVWHGSULQFL
SOHVIRUWKHHVWDEOLVKPHQWRIFXVWRPPDGH3RXUEDL[GLDJUDPVWKDWFDQEHDSSOLHGWR SOHVIRUWKHHVWDEOLVKPHQWRIFXVWRPPDGH3RXUEDL[GLDJUDPVWKDWFDQEHDSSOLHGWR
GHVFULEHFRPSOH[V\VWHPVRUWRLQYHVWLJDWHWKH HIIHFWRIHJFRPELQDWLRQRIGLYHUVH GHVFULEHFRPSOH[V\VWHPVRUWRLQYHVWLJDWHWKH HIIHFWRIHJFRPELQDWLRQRIGLYHUVH
PHWDOV:LWKUHJDUGWRWKLVZHSURSRVHWKHIROORZLQJGLIIUDFWLRQEHWZHHQWKUHHGLV PHWDOV:LWKUHJDUGWRWKLVZHSURSRVHWKHIROORZLQJGLIIUDFWLRQEHWZHHQWKUHHGLV
WLQFWW\SHVRI3RXUEDL[GLDJUDPVIRUZKLFKWKH IROORZLQJWHUPLQRORJ\LVXVHGLQWKH WLQFWW\SHVRI3RXUEDL[GLDJUDPVIRUZKLFKWKH IROORZLQJWHUPLQRORJ\LVXVHGLQWKH
UHPDLQLQJSDUWRIWKLVWKHVLV FI&KDSWHUµ7D'¶  UHPDLQLQJSDUWRIWKLVWKHVLV FI&KDSWHUµ7D'¶ 
‡ 6LQJOHHOHPHQW3RXUEDL[GLDJUDPµ6(3'¶ ‡ 6LQJOHHOHPHQW3RXUEDL[GLDJUDPµ6(3'¶
7KHWHUPVLQJOHHOHPHQW3RXUEDL[GLDJUDPµ6(3'¶UHIHUVWRD3RXUEDL[GLDJUDP 7KHWHUPVLQJOHHOHPHQW3RXUEDL[GLDJUDPµ6(3'¶UHIHUVWRD3RXUEDL[GLDJUDP
RIDQµ(O¶+2V\VWHP FRYHULQJRQO\RQHHOHPHQW,QWKLVWKHVLVµ6(3'V¶DUHQRU RIDQµ(O¶+2V\VWHP FRYHULQJRQO\RQHHOHPHQW,QWKLVWKHVLVµ6(3'V¶DUHQRU
PDOO\ OLPLWHG WR µ0H¶+2 V\VWHPV +RZHYHU 3RXUEDL[ GLDJUDPV DUH QRW DW DOO PDOO\ OLPLWHG WR µ0H¶+2 V\VWHPV +RZHYHU 3RXUEDL[ GLDJUDPV DUH QRW DW DOO
OLPLWHG WR FRQVLGHUDWLRQV RQ PHWDOV ,Q SDUWLFXODU LQ WKH GHVLJQ RI WKH SURSRVHG OLPLWHG WR FRQVLGHUDWLRQV RQ PHWDOV ,Q SDUWLFXODU LQ WKH GHVLJQ RI WKH SURSRVHG
QHZFRXQWHUPHDVXUHV &KDSWHU IRFXVLVVHWRQLQYHVWLJDWLRQVFRQFHUQLQJRWKHU QHZFRXQWHUPHDVXUHV &KDSWHU IRFXVLVVHWRQLQYHVWLJDWLRQVFRQFHUQLQJRWKHU
HOHPHQWVDVZHOODVWKHWKHUPRG\QDPLFVRIPHWDOVLQFRPELQDWLRQZLWKRWKHUHOH HOHPHQWVDVZHOODVWKHWKHUPRG\QDPLFVRIPHWDOVLQFRPELQDWLRQZLWKRWKHUHOH
PHQWV‚ PHQWV‚
,Q)LJXUHVDQµ6(3'¶DSSHDUVZLWKRQO\RQHLRQDFWLYLW\DERYHWKHGLDJUDPHJ ,Q)LJXUHVDQµ6(3'¶DSSHDUVZLWKRQO\RQHLRQDFWLYLW\DERYHWKHGLDJUDPHJ
³)HLD í´LQGLFDWHVD3RXUEDL[GLDJUDPIRUWKH)H+2V\VWHPZLWKDQLURQLRQ ³)HLD í´LQGLFDWHVD3RXUEDL[GLDJUDPIRUWKH)H+2V\VWHPZLWKDQLURQLRQ
DFWLYLW\RIíPRO/ DFWLYLW\RIíPRO/
‡ 0XOWLHOHPHQW3RXUEDL[GLDJUDPµ0(3'¶ ‡ 0XOWLHOHPHQW3RXUEDL[GLDJUDPµ0(3'¶
7KHWHUPPXOWLHOHPHQW3RXUEDL[GLDJUDPµ0(3'¶UHIHUVWRD3RXUEDL[GLDJUDP 7KHWHUPPXOWLHOHPHQW3RXUEDL[GLDJUDPµ0(3'¶UHIHUVWRD3RXUEDL[GLDJUDP
FRYHULQJ RQH PDLQ HOHPHQW µ(O¶  LQ FRPELQDWLRQ ZLWK RWKHU HOHPHQWV µ(O¶ FRYHULQJ RQH PDLQ HOHPHQW µ(O¶  LQ FRPELQDWLRQ ZLWK RWKHU HOHPHQWV µ(O¶
µ(O]¶ LHDQµ(O¶µ(O¶«µ(O]¶+2V\VWHPZKLFKWDNHV DOOVSHFLHVWKDWFDQEH µ(O]¶ LHDQµ(O¶µ(O¶«µ(O]¶+2V\VWHPZKLFKWDNHV DOOVSHFLHVWKDWFDQEH

 

7HPSHUDWXUHHIIHFWVDUHWDNHQLQWRDFFRXQWLQWKHSURSRVHGQHZFRXQWHUPHDVXUHV1RQHWKHOHVVDOO 7HPSHUDWXUHHIIHFWVDUHWDNHQLQWRDFFRXQWLQWKHSURSRVHGQHZFRXQWHUPHDVXUHV1RQHWKHOHVVDOO
3RXUEDL[GLDJUDPVLQWKHSUHVHQWWKHVLVDUHJLYHQIRUWKHVWDQGDUGVWDWHWHPSHUDWXUHRIƒ&LQRUGHU 3RXUEDL[GLDJUDPVLQWKHSUHVHQWWKHVLVDUHJLYHQIRUWKHVWDQGDUGVWDWHWHPSHUDWXUHRIƒ&LQRUGHU
WRUHGXFHWKHDPRXQWRIYDULDEOHV WRUHGXFHWKHDPRXQWRIYDULDEOHV
‚ ‚
7KHVHFRQVLGHUDWLRQVDQGWKHDVVRFLDWHG3RXUEDL[GLDJUDPVDUHQRWLQFOXGHGLQWKHSUHVHQWWKHVLVZLWK 7KHVHFRQVLGHUDWLRQVDQGWKHDVVRFLDWHG3RXUEDL[GLDJUDPVDUHQRWLQFOXGHGLQWKHSUHVHQWWKHVLVZLWK
UHJDUGWRWKHH[SHFWHGSDWHQWSRVVLELOLWLHV FI6HFWLRQ  UHJDUGWRWKHH[SHFWHGSDWHQWSRVVLELOLWLHV FI6HFWLRQ 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV

IRUPHGEHWZHHQWKHWZRRUPRUHHOHPHQWVLQWRDFFRXQWDVHJWKH3RXUEDL[GLD IRUPHGEHWZHHQWKHWZRRUPRUHHOHPHQWVLQWRDFFRXQWDVHJWKH3RXUEDL[GLD
JUDPRIWKH)H=Q+2V\VWHP JUDPRIWKH)H=Q+2V\VWHP
,Q )LJXUHV DQ µ0(3'¶ LV LQGLFDWHG E\ VHSDUDWLQJ WKH FRQFHQWUDWLRQV RI WKH LQ ,Q )LJXUHV DQ µ0(3'¶ LV LQGLFDWHG E\ VHSDUDWLQJ WKH FRQFHQWUDWLRQV RI WKH LQ
YROYHG HOHPHQWV ZLWK FRPPDV ZKLOH WKH PDLQ HOHPHQW LV QDPHG ILUVW )RU LQ YROYHG HOHPHQWV ZLWK FRPPDV ZKLOH WKH PDLQ HOHPHQW LV QDPHG ILUVW )RU LQ
VWDQFH³)HLD í=QLDí´LQGLFDWHVD3RXUEDL[GLDJUDPIRUWKH)H=Q+2V\V VWDQFH³)HLD í=QLDí´LQGLFDWHVD3RXUEDL[GLDJUDPIRUWKH)H=Q+2V\V
WHPZKHUH)HLVWKHPDLQHOHPHQWDQGWKHLRQDFWLYLWLHVRIERWK)HDQG=QDUHí WHPZKHUH)HLVWKHPDLQHOHPHQWDQGWKHLRQDFWLYLWLHVRIERWK)HDQG=QDUHí
PRO/ PRO/
‡ 6XSHULPSRVHG3RXUEDL[GLDJUDPµ6,3'¶ ‡ 6XSHULPSRVHG3RXUEDL[GLDJUDPµ6,3'¶
7KHWHUPVXSHULPSRVHG3RXUEDL[GLDJUDPµ6,3'¶PDLQO\UHIHUVWRDVXSHULPSRVL 7KHWHUPVXSHULPSRVHG3RXUEDL[GLDJUDPµ6,3'¶PDLQO\UHIHUVWRDVXSHULPSRVL
WLRQRILQGLYLGXDOµ6(3'V¶LHDQµ(O¶+2V\VWHPRQDQµ(O¶+2V\VWHPRQDQ WLRQRILQGLYLGXDOµ6(3'V¶LHDQµ(O¶+2V\VWHPRQDQµ(O¶+2V\VWHPRQDQ
« RQ DQ µ(O]¶+2 V\VWHP PDLQO\ VXSHUSRVLWLRQ RI D µ0H¶+2 RQ D VHFRQG « RQ DQ µ(O]¶+2 V\VWHP PDLQO\ VXSHUSRVLWLRQ RI D µ0H¶+2 RQ D VHFRQG
µ0H¶+2V\VWHP ZLWKRXWWDNLQJLQWRDFFRXQWWKHVSHFLHVWKDWFDQEHIRUPHGEH µ0H¶+2V\VWHP ZLWKRXWWDNLQJLQWRDFFRXQWWKHVSHFLHVWKDWFDQEHIRUPHGEH
WZHHQWKHWZRHOHPHQWV HJWKHVXSHUSRVLWLRQRID=Q+2V\VWHPRQD)H+2 WZHHQWKHWZRHOHPHQWV HJWKHVXSHUSRVLWLRQRID=Q+2V\VWHPRQD)H+2
V\VWHP  +RZHYHU µ6,3'V¶ FDQ DOVR UHSUHVHQW WKH VXSHUSRVLWLRQ RI WZR RU PRUH V\VWHP  +RZHYHU µ6,3'V¶ FDQ DOVR UHSUHVHQW WKH VXSHUSRVLWLRQ RI WZR RU PRUH
µ0(3'V¶ RU DQ\ DUELWUDU\ FRPELQDWLRQ RI µ0(3'V¶ DQG µ6(3'V¶ )RU LQVWDQFH µ0(3'V¶ RU DQ\ DUELWUDU\ FRPELQDWLRQ RI µ0(3'V¶ DQG µ6(3'V¶ )RU LQVWDQFH
WKHVXSHUSRVLWLRQRIWKHµ0(3'¶RIVHOHFWHGVWDLQOHVVVWHHODOOR\V HJWKH&U)H WKHVXSHUSRVLWLRQRIWKHµ0(3'¶RIVHOHFWHGVWDLQOHVVVWHHODOOR\V HJWKH&U)H
1L0R+2V\VWHP RQWKH)H+2V\VWHPLVDOVRUHIHUUHGWRDVµ6,3'¶ 1L0R+2V\VWHP RQWKH)H+2V\VWHPLVDOVRUHIHUUHGWRDVµ6,3'¶
,Q)LJXUHVDQµ6,3'¶LVLQGLFDWHGE\VHSDUDWLQJWKHFRQFHQWUDWLRQVRIWKHLQYROYHG ,Q)LJXUHVDQµ6,3'¶LVLQGLFDWHGE\VHSDUDWLQJWKHFRQFHQWUDWLRQVRIWKHLQYROYHG
HOHPHQWV ZLWK D VODVK ZKLOH WKH RYHUO\LQJ µ6(3'¶ LV OLVWHG ILUVW HJ ³=QLD HOHPHQWV ZLWK D VODVK ZKLOH WKH RYHUO\LQJ µ6(3'¶ LV OLVWHG ILUVW HJ ³=QLD
í)HLD í´LQGLFDWHVVXSHUSRVLWLRQRIWKHµ6(3'¶RIWKH=Q+2V\VWHPZLWK í)HLD í´LQGLFDWHVVXSHUSRVLWLRQRIWKHµ6(3'¶RIWKH=Q+2V\VWHPZLWK
DQLRQDFWLYLW\RIíPRO/RQDQµ6(3'¶RIWKH)H+2V\VWHPZLWKWKHVDPH DQLRQDFWLYLW\RIíPRO/RQDQµ6(3'¶RIWKH)H+2V\VWHPZLWKWKHVDPH
LRQ DFWLYLW\  6XSHUSRVLWLRQ LQYROYLQJ µ0(3'V¶ IROORZV WKH VDPH VFKHPH HJ LRQ DFWLYLW\  6XSHUSRVLWLRQ LQYROYLQJ µ0(3'V¶ IROORZV WKH VDPH VFKHPH HJ
³&ULDí)HLDí1LLDí0RLDí)HLDí´LQGLFDWHVWKHVXSHUSRVLWLRQRI ³&ULDí)HLDí1LLDí0RLDí)HLDí´LQGLFDWHVWKHVXSHUSRVLWLRQRI
WKH &U)H1L0R+2 V\VWHP &U DV PDLQ HOHPHQW  RQ WKH )H+2 V\VWHP ZLWK WKH &U)H1L0R+2 V\VWHP &U DV PDLQ HOHPHQW  RQ WKH )H+2 V\VWHP ZLWK
WKH LRQ DFWLYLWLHV RI DOO LQYROYHG PHWDOV FRUUHVSRQGLQJ WR í PRO/ )RU EHWWHU WKH LRQ DFWLYLWLHV RI DOO LQYROYHG PHWDOV FRUUHVSRQGLQJ WR í PRO/ )RU EHWWHU
YLVXDOLVDWLRQWKHXQGHUO\LQJGLDJUDPLVJHQHUDOO\FRORXUHGLQEOXHUHGDQG\HOORZ YLVXDOLVDWLRQWKHXQGHUO\LQJGLDJUDPLVJHQHUDOO\FRORXUHGLQEOXHUHGDQG\HOORZ
ZKLFK FRUUHVSRQG WR WKH LPPXQH FRUURVLRQ DQG SDVVLYH GRPDLQ UHVSHFWLYHO\ ZKLFK FRUUHVSRQG WR WKH LPPXQH FRUURVLRQ DQG SDVVLYH GRPDLQ UHVSHFWLYHO\
'HSHQGLQJRQWKHHIIHFWWREHH[HPSOLILHGVHOHFWHGGRPDLQVRIWKHVXSHULPSRVHG 'HSHQGLQJRQWKHHIIHFWWREHH[HPSOLILHGVHOHFWHGGRPDLQVRIWKHVXSHULPSRVHG
GLDJUDPDUHGLVSOD\HGWUDQVSDUHQWO\ GLDJUDPDUHGLVSOD\HGWUDQVSDUHQWO\
7RRXUNQRZOHGJHQHLWKHUµ0(3'V¶QRUµ6,3'V¶KDYHEHHQDSSOLHGLQWKHDUHDRIUH 7RRXUNQRZOHGJHQHLWKHUµ0(3'V¶QRUµ6,3'V¶KDYHEHHQDSSOLHGLQWKHDUHDRIUH
LQIRUFHPHQWFRUURVLRQ$VLQGLFDWHGLQ&KDSWHUWKHXVHRIWKH3RXUEDL[GLDJUDPVLQ LQIRUFHPHQWFRUURVLRQ$VLQGLFDWHGLQ&KDSWHUWKHXVHRIWKH3RXUEDL[GLDJUDPVLQ
WKLVDUHDDSSHDUVWREHOLPLWHGWRWKH)H+2V\VWHPPDLQO\IRUH[HPSOLILFDWLRQSXU WKLVDUHDDSSHDUVWREHOLPLWHGWRWKH)H+2V\VWHPPDLQO\IRUH[HPSOLILFDWLRQSXU
SRVHV&RQVLGHULQJIRULQVWDQFHWKHDSSOLFDWLRQRIJDOYDQLVHGVWHHORUµ&3¶IRUUHLQ SRVHV&RQVLGHULQJIRULQVWDQFHWKHDSSOLFDWLRQRIJDOYDQLVHGVWHHORUµ&3¶IRUUHLQ
IRUFHGFRQFUHWHVWUXFWXUHVZHWKLQNWKDWVXFKWRROVKDYHDORWRISRWHQWLDOLQWKLVDUHD IRUFHGFRQFUHWHVWUXFWXUHVZHWKLQNWKDWVXFKWRROVKDYHDORWRISRWHQWLDOLQWKLVDUHD
DQG VKRXOG QRW EH GLVUHJDUGHG LQ SDUWLFXODU FRQFHUQLQJ YHULILFDWLRQ DQG GHVLJQ RI DQG VKRXOG QRW EH GLVUHJDUGHG LQ SDUWLFXODU FRQFHUQLQJ YHULILFDWLRQ DQG GHVLJQ RI
FRXQWHUPHDVXUHV FI&KDSWHUDQGUHVSHFWLYHO\  FRXQWHUPHDVXUHV FI&KDSWHUDQGUHVSHFWLYHO\ 
6RPH µ6,3'V¶ FDQ EH IRXQG LQ WKH OLWHUDWXUH RQ FRUURVLRQ VFLHQFH DQG DUH XVHG VXF 6RPH µ6,3'V¶ FDQ EH IRXQG LQ WKH OLWHUDWXUH RQ FRUURVLRQ VFLHQFH DQG DUH XVHG VXF
FHVVIXOO\LQYDULRXVDUHDVHJZLWKUHJDUGWRJDOYDQLFFRXSOLQJRIPHWDOVHVSHFLDOO\ FHVVIXOO\LQYDULRXVDUHDVHJZLWKUHJDUGWRJDOYDQLFFRXSOLQJRIPHWDOVHVSHFLDOO\
FRQFHUQLQJPHWDOFRDWLQJVDQGFODGGLQJRUµ&3¶E\VDFULILFLDODQRGHV+RZHYHUHYHQ FRQFHUQLQJPHWDOFRDWLQJVDQGFODGGLQJRUµ&3¶E\VDFULILFLDODQRGHV+RZHYHUHYHQ
LQJHQHUDOFRUURVLRQVFLHQFHWKHUHVHHPVWREHFHUWDLQUHOXFWDQFHWRZDUGVWKHXVHRI LQJHQHUDOFRUURVLRQVFLHQFHWKHUHVHHPVWREHFHUWDLQUHOXFWDQFHWRZDUGVWKHXVHRI

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP

µ0(3'V¶7KLVUHOXFWDQFHPLJKWEHUHODWHGWRWKHFRPSOH[LW\RIV\VWHPVZKHUHIRUPD µ0(3'V¶7KLVUHOXFWDQFHPLJKWEHUHODWHGWRWKHFRPSOH[LW\RIV\VWHPVZKHUHIRUPD
WLRQRIPXOWLSOHVSHFLHVLVSRVVLEOHVLQFHWKRVHVSHFLHVKDYHWREHFDUHIXOO\FRQVLGHUHG WLRQRIPXOWLSOHVSHFLHVLVSRVVLEOHVLQFHWKRVHVSHFLHVKDYHWREHFDUHIXOO\FRQVLGHUHG
DQGSUHVHOHFWHG DQGSUHVHOHFWHG
)RUWKHSUHVHOHFWLRQLWLVQRWVXIILFLHQWWRWDNHLQWRDFFRXQWZKHWKHURUQRWDVSHFLHVLV )RUWKHSUHVHOHFWLRQLWLVQRWVXIILFLHQWWRWDNHLQWRDFFRXQWZKHWKHURUQRWDVSHFLHVLV
WKHUPRG\QDPLFDOO\IDYRXUHGEDVHGRQWKHDVVRFLDWHGµ¨*I¶)RUPDWLRQRIVHYHUDOLQ WKHUPRG\QDPLFDOO\IDYRXUHGEDVHGRQWKHDVVRFLDWHGµ¨*I¶)RUPDWLRQRIVHYHUDOLQ
SDUWLFXODUFRPSOH[VSHFLHVFDQEHWKHUPRG\QDPLFDOO\SRVVLEOHRUHYHQIDYRXUHGEXW SDUWLFXODUFRPSOH[VSHFLHVFDQEHWKHUPRG\QDPLFDOO\SRVVLEOHRUHYHQIDYRXUHGEXW
VXFKVSHFLHVPD\QRWSOD\DUROHLQWKHV\VWHPXQGHULQYHVWLJDWLRQ(YHQLIDVSHFLHVLV VXFKVSHFLHVPD\QRWSOD\DUROHLQWKHV\VWHPXQGHULQYHVWLJDWLRQ(YHQLIDVSHFLHVLV
WKHUPRG\QDPLFDOO\ IDYRXUHG NLQHWLFV FDQ ODUJHO\ LPSHGH RU HQWLUHO\ SUHYHQW IRUPD WKHUPRG\QDPLFDOO\ IDYRXUHG NLQHWLFV FDQ ODUJHO\ LPSHGH RU HQWLUHO\ SUHYHQW IRUPD
WLRQLIWKHDFWLYDWLRQHQHUJ\IRUIRUPDWLRQRIWKHVSHFLHVZKLFKLVSULQFLSDOO\DIXQF WLRQLIWKHDFWLYDWLRQHQHUJ\IRUIRUPDWLRQRIWKHVSHFLHVZKLFKLVSULQFLSDOO\DIXQF
WLRQRIWKHWHPSHUDWXUHLVRXWRIWKHUDQJHLQWKHV\VWHPXQGHULQYHVWLJDWLRQ7KHDFWL WLRQRIWKHWHPSHUDWXUHLVRXWRIWKHUDQJHLQWKHV\VWHPXQGHULQYHVWLJDWLRQ7KHDFWL
YDWLRQHQHUJ\ LQWKHOLWHUDWXUHDOVRUHIHUUHGWRDV$UUKHQLXV DFWLYDWLRQHQHUJ\ LVGH YDWLRQHQHUJ\ LQWKHOLWHUDWXUHDOVRUHIHUUHGWRDV$UUKHQLXV DFWLYDWLRQHQHUJ\ LVGH
ILQHGDV>,83$&@ ³$QHPSLULFDOSDUDPHWHU µ(D¶ FKDUDFWHUL]LQJWKHH[SRQHQ ILQHGDV>,83$&@ ³$QHPSLULFDOSDUDPHWHU µ(D¶ FKDUDFWHUL]LQJWKHH[SRQHQ
WLDOWHPSHUDWXUHGHSHQGHQFHRIWKHUDWHFRHIILFLHQW µN¶  WLDOWHPSHUDWXUHGHSHQGHQFHRIWKHUDWHFRHIILFLHQW µN¶ 

§ ∂ ( OQ ( N ) ) · § ∂ ( OQ ( N ) ) ·
(D 5 × 7 × ¨ ¸ >@ (D 5 × 7 × ¨ ¸ >@
¨ ∂7 ¸ ¨ ∂7 ¸
© ¹ © ¹
ZKHUHµ5¶LVWKHJDVFRQVWDQWDQGµ7¶WKHWKHUPRG\QDPLFWHPSHUDWXUH´ ZKHUHµ5¶LVWKHJDVFRQVWDQWDQGµ7¶WKHWKHUPRG\QDPLFWHPSHUDWXUH´
%HVLGHVWKLV³EDVLFFDVH´DQRWKHURSWLRQLVSRVVLEOH*LYHQWKDWFHUWDLQLQLWLDOO\SUH %HVLGHVWKLV³EDVLFFDVH´DQRWKHURSWLRQLVSRVVLEOH*LYHQWKDWFHUWDLQLQLWLDOO\SUH
VHQWUHDFWDQWVFDQIRUPWZRGLYHUVHVSHFLHVZLWKGLIIHUHQWµ¨*I¶WKHVSHFLHVZLWKWKH VHQWUHDFWDQWVFDQIRUPWZRGLYHUVHVSHFLHVZLWKGLIIHUHQWµ¨*I¶WKHVSHFLHVZLWKWKH
ORZHUµ¨*I¶FRXOGEHIRUPHGIDVWHUWKDQWKHRQHZLWKWKHKLJKHUµ¨*I¶DQGHYHQWX ORZHUµ¨*I¶FRXOGEHIRUPHGIDVWHUWKDQWKHRQHZLWKWKHKLJKHUµ¨*I¶DQGHYHQWX
DOO\IRUPDWLRQRIWKHVSHFLHVZLWKWKHKLJKHUµ¨*I¶LVWKHUPRG\QDPLFDOO\LPSRVVLEOH DOO\IRUPDWLRQRIWKHVSHFLHVZLWKWKHKLJKHUµ¨*I¶LVWKHUPRG\QDPLFDOO\LPSRVVLEOH
EDVHGRQWKH³WUDQVIRUPHGUHDFWDQWV´ EDVHGRQWKH³WUDQVIRUPHGUHDFWDQWV´
6XFKNLQHWLFDVSHFWVFDQJHQHUDOO\QRWEHDVVHVVHGDQGQHLWKHUWKHUDWHFRHIILFLHQWQRU 6XFKNLQHWLFDVSHFWVFDQJHQHUDOO\QRWEHDVVHVVHGDQGQHLWKHUWKHUDWHFRHIILFLHQWQRU
WKH DFWLYDWLRQ HQHUJ\ IRU PRVW RI WKH FKHPLFDO VSHFLHV RI FRQFHUQ LQ WKLV WKHVLV LV WKH DFWLYDWLRQ HQHUJ\ IRU PRVW RI WKH FKHPLFDO VSHFLHV RI FRQFHUQ LQ WKLV WKHVLV LV
DYDLODEOHLQWKHOLWHUDWXUHVRWKDWLQIRUPDWLRQRQWKHWHPSHUDWXUHRIIRUPDWLRQFDQQRW DYDLODEOHLQWKHOLWHUDWXUHVRWKDWLQIRUPDWLRQRQWKHWHPSHUDWXUHRIIRUPDWLRQFDQQRW
EHGHGXFHG:LWKUHJDUGWRWKLVLWLVFUXFLDOWRHPSKDVLVHWKDWQHLWKHUWKHUHDFWLRQNL EHGHGXFHG:LWKUHJDUGWRWKLVLWLVFUXFLDOWRHPSKDVLVHWKDWQHLWKHUWKHUHDFWLRQNL
QHWLFVQRUWKHDFWLYDWLRQHQHUJ\RIDVSHFLHVDUHE\DQ\PHDQVUHIOHFWHGE\WKHDVVRFL QHWLFVQRUWKHDFWLYDWLRQHQHUJ\RIDVSHFLHVDUHE\DQ\PHDQVUHIOHFWHGE\WKHDVVRFL
DWHGµ¨*I¶ZKLFKLVH[HPSOLILHGLQ6RWKHFKRLFHRIVSHFLHVWREHIRUPHGLV DWHGµ¨*I¶ZKLFKLVH[HPSOLILHGLQ6RWKHFKRLFHRIVSHFLHVWREHIRUPHGLV
FULWLFDODQGUDWKHUFRPSOH[LQWKHHVWDEOLVKPHQWRIFXVWRPPDGH3RXUEDL[GLDJUDPV FULWLFDODQGUDWKHUFRPSOH[LQWKHHVWDEOLVKPHQWRIFXVWRPPDGH3RXUEDL[GLDJUDPV
HVSHFLDOO\IRUµ0(3'V¶DQGDGGLWLRQDOPHDQVDUHWREHXVHGWRREWDLQQHFHVVDU\LQ HVSHFLDOO\IRUµ0(3'V¶DQGDGGLWLRQDOPHDQVDUHWREHXVHGWRREWDLQQHFHVVDU\LQ
IRUPDWLRQRQWKHDFWXDOOLNHOLKRRGRIIRUPDWLRQRIWKHYDULRXVWKHUPRG\QDPLFDOO\ID IRUPDWLRQRQWKHDFWXDOOLNHOLKRRGRIIRUPDWLRQRIWKHYDULRXVWKHUPRG\QDPLFDOO\ID
YRXUHGVSHFLHV YRXUHGVSHFLHV
%HVLGHVVRPHJHQHUDOXQGHUVWDQGLQJRIWKHFKHPLVWU\DQGHOHFWURFKHPLVWU\RIWKHV\V %HVLGHVVRPHJHQHUDOXQGHUVWDQGLQJRIWKHFKHPLVWU\DQGHOHFWURFKHPLVWU\RIWKHV\V
WHP XQGHU LQYHVWLJDWLRQ DGGLWLRQDO PHDQV WKDW ZH DSSOLHG IRU GHGXFLQJ LQIRUPDWLRQ WHP XQGHU LQYHVWLJDWLRQ DGGLWLRQDO PHDQV WKDW ZH DSSOLHG IRU GHGXFLQJ LQIRUPDWLRQ
RQOLNHOLKRRGRIIRUPDWLRQRIWKHYDULRXVWKHUPRG\QDPLFDOO\SRVVLEOHVSHFLHVLQFOXGH RQOLNHOLKRRGRIIRUPDWLRQRIWKHYDULRXVWKHUPRG\QDPLFDOO\SRVVLEOHVSHFLHVLQFOXGH
WKHIROORZLQJ WKHIROORZLQJ
‡ 6RXUFHVFRQWDLQLQJ3RXUEDL[GLDJUDPV ‡ 6RXUFHVFRQWDLQLQJ3RXUEDL[GLDJUDPV

 

1DPHGDIWHU6YDQWH$XJXVW$UUKHQLXV6ZHGHQ>:LNLPHGLD@ 1DPHGDIWHU6YDQWH$XJXVW$UUKHQLXV6ZHGHQ>:LNLPHGLD@

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV

,Q SULQFLSOH WKH XVH RI OLWHUDWXUH FRQWDLQLQJ D ZLGHU VHOHFWLRQ RI 3RXUEDL[ GLD ,Q SULQFLSOH WKH XVH RI OLWHUDWXUH FRQWDLQLQJ D ZLGHU VHOHFWLRQ RI 3RXUEDL[ GLD
JUDPVLVODUJHO\OLPLWHGWR>3RXUEDL[E@DVYDULRXVVXEVHTXHQWSXEOLFDWLRQV JUDPVLVODUJHO\OLPLWHGWR>3RXUEDL[E@DVYDULRXVVXEVHTXHQWSXEOLFDWLRQV
GHDOLQJZLWK3RXUEDL[GLDJUDPVFLWHWKHVHGLDJUDPVZLWKRUZLWKRXWPRGLILFDWLRQV GHDOLQJZLWK3RXUEDL[GLDJUDPVFLWHWKHVHGLDJUDPVZLWKRUZLWKRXWPRGLILFDWLRQV
$VPHQWLRQHGWKHGLDJUDPVSURYLGHGLQ>3RXUEDL[E@DUHJHQHUDOO\OLPLWHGWR $VPHQWLRQHGWKHGLDJUDPVSURYLGHGLQ>3RXUEDL[E@DUHJHQHUDOO\OLPLWHGWR
µ6(3'V¶EXWWKH\SURYLGHVRPHIXQGDPHQWDOQRWLRQVIRUVSHFLHVWREHWDNHQLQWR µ6(3'V¶EXWWKH\SURYLGHVRPHIXQGDPHQWDOQRWLRQVIRUVSHFLHVWREHWDNHQLQWR
FRQVLGHUDWLRQ IRU µ0(3'V¶ +RZHYHU VRPH SXEOLFDWLRQV GHDO ZLWK WKHUPRG\ FRQVLGHUDWLRQ IRU µ0(3'V¶ +RZHYHU VRPH SXEOLFDWLRQV GHDO ZLWK WKHUPRG\
QDPLFSURSHUWLHVRIUHOHYDQWVSHFLHVDQGSRVWXODWHWKHDVVRFLDWHGWKHUPRG\QDPLF QDPLFSURSHUWLHVRIUHOHYDQWVSHFLHVDQGSRVWXODWHWKHDVVRFLDWHGWKHUPRG\QDPLF
GDWDRUWKHFRUUHVSRQGLQJUHJLRQVLQWKH3RXUEDL[GLDJUDP)RULQVWDQFHWKHRUHWL GDWDRUWKHFRUUHVSRQGLQJUHJLRQVLQWKH3RXUEDL[GLDJUDP)RULQVWDQFHWKHRUHWL
FDODQGH[SHULPHQWDOGDWDRQLURQVSHFLHVIRUPHGXQGHUFDUERQDWLRQDQGFKORULGH FDODQGH[SHULPHQWDOGDWDRQLURQVSHFLHVIRUPHGXQGHUFDUERQDWLRQDQGFKORULGH
LQGXFHG FRUURVLRQ KDV EHHQ SXEOLVKHG LQ HJ >5HIDLW  *pQLQ  6DJRH LQGXFHG FRUURVLRQ KDV EHHQ SXEOLVKHG LQ HJ >5HIDLW  *pQLQ  6DJRH
&UHQWVLO *ODVVHU'ULVVLHWDO5HIDLWHWDO@ &UHQWVLO *ODVVHU'ULVVLHWDO5HIDLWHWDO@
‡ 6RXUFHVFRQWDLQLQJLQIRUPDWLRQRQWKHFKHPLVWU\RIPDWHULDOV ‡ 6RXUFHVFRQWDLQLQJLQIRUPDWLRQRQWKHFKHPLVWU\RIPDWHULDOV
6SHFLHV WKDW GR QRW LQYROYH FRPSOH[ FRPELQDWLRQV RI HOHPHQWV FDQ RIWHQ EH GH 6SHFLHV WKDW GR QRW LQYROYH FRPSOH[ FRPELQDWLRQV RI HOHPHQWV FDQ RIWHQ EH GH
GXFHG IURP LQIRUPDWLRQ RQ WKH FKHPLVWU\ RI WKH EDVH PDWHULDO SURYLGHG LQ WH[W GXFHG IURP LQIRUPDWLRQ RQ WKH FKHPLVWU\ RI WKH EDVH PDWHULDO SURYLGHG LQ WH[W
ERRNV RU SXEOLFDWLRQV )RU PHWDOV LQIRUPDWLRQ IURP VWDQGDUG WH[WERRNV HJ ERRNV RU SXEOLFDWLRQV )RU PHWDOV LQIRUPDWLRQ IURP VWDQGDUG WH[WERRNV HJ
>'DYLV%KDGHVKLD +RQH\FRPEH@IRULURQRUHJ>=KDQJ@IRU >'DYLV%KDGHVKLD +RQH\FRPEH@IRULURQRUHJ>=KDQJ@IRU
]LQF FDQEHDSSOLHGZKHUHDVVWDQGDUGWH[WERRNVRQFHPHQWDQGFRQFUHWHFKHPLV ]LQF FDQEHDSSOLHGZKHUHDVVWDQGDUGWH[WERRNVRQFHPHQWDQGFRQFUHWHFKHPLV
WU\ HJ >7D\ORU @  DQG YDULRXV MRXUQDO SDSHUV HJ >/RWKHQEDFK  :LQQH WU\ HJ >7D\ORU @  DQG YDULRXV MRXUQDO SDSHUV HJ >/RWKHQEDFK  :LQQH
IHOG  0DWVFKHL HWDO E 0DWVFKHL HWDO D@  RU GDWDEDVHV HJ IHOG  0DWVFKHL HWDO E 0DWVFKHL HWDO D@  RU GDWDEDVHV HJ
>(03$@ SURYLGHLQIRUPDWLRQRQFKHPLFDOVSHFLHVIRUPHGLQFRQFUHWH FI >(03$@ SURYLGHLQIRUPDWLRQRQFKHPLFDOVSHFLHVIRUPHGLQFRQFUHWH FI
6HFWLRQ )XUWKHUPRUHVWDQGDUGFKHPLVWU\RUPDWHULDOVVFLHQFHWH[WERRNV HJ 6HFWLRQ )XUWKHUPRUHVWDQGDUGFKHPLVWU\RUPDWHULDOVVFLHQFHWH[WERRNV HJ
>)UHLHVOHEHQ+DQVHQ&DOOLVWHU &DOOLVWHU@ RUPLQHUDODQGFKHPLFDO >)UHLHVOHEHQ+DQVHQ&DOOLVWHU &DOOLVWHU@ RUPLQHUDODQGFKHPLFDO
GDWDEDVHV HJ >0LQ'DW  0LQ*DO  :HE(OH  :HE0LQ @  GDWDEDVHV HJ >0LQ'DW  0LQ*DO  :HE(OH  :HE0LQ @ 
PD\EHFRQVXOWHG PD\EHFRQVXOWHG
‡ 6RXUFHV FRQWDLQLQJ LQIRUPDWLRQ RQ FRUURVLRQ SURGXFWV IRUPHG LQ D FHUWDLQ HQYL ‡ 6RXUFHV FRQWDLQLQJ LQIRUPDWLRQ RQ FRUURVLRQ SURGXFWV IRUPHG LQ D FHUWDLQ HQYL
URQPHQWDQGFRQGLWLRQVIRUIRUPDWLRQRIFRPSRXQGVEHWZHHQGLIIHUHQWVSHFLHV URQPHQWDQGFRQGLWLRQVIRUIRUPDWLRQRIFRPSRXQGVEHWZHHQGLIIHUHQWVSHFLHV
7KH DERYH PHQWLRQHG WH[WERRNV RQ PHWDOV DOVR FRQWDLQ JHQHUDO LQIRUPDWLRQ RQ 7KH DERYH PHQWLRQHG WH[WERRNV RQ PHWDOV DOVR FRQWDLQ JHQHUDO LQIRUPDWLRQ RQ
FRUURVLRQSURGXFWVZKLOHFRUURVLRQSURGXFWVIRUPHGLQWKHFRQFUHWHHQYLURQPHQW FRUURVLRQSURGXFWVZKLOHFRUURVLRQSURGXFWVIRUPHGLQWKHFRQFUHWHHQYLURQPHQW
DUH JHQHUDOO\ QRW FRYHUHG DQG PDQ\ VFLHQWLILF SDSHUV GHDO ZLWK WKH IRUPDWLRQ RI DUH JHQHUDOO\ QRW FRYHUHG DQG PDQ\ VFLHQWLILF SDSHUV GHDO ZLWK WKH IRUPDWLRQ RI
FRUURVLRQ SURGXFWV XQGHU DWPRVSKHULF RU VXEPHUJHG FRQGLWLRQV RIWHQ LQ FRQQHF FRUURVLRQ SURGXFWV XQGHU DWPRVSKHULF RU VXEPHUJHG FRQGLWLRQV RIWHQ LQ FRQQHF
WLRQZLWKFKORULGHH[SRVXUHHJ>5HIDLW *pQLQ$QWXQHVHWDO5p WLRQZLWKFKORULGHH[SRVXUHHJ>5HIDLW *pQLQ$QWXQHVHWDO5p
PD]HLOOHV 5HIDLW@,QIRUPDWLRQRQFRUURVLRQSURGXFWVREVHUYHGLQFRQFUHWH PD]HLOOHV 5HIDLW@,QIRUPDWLRQRQFRUURVLRQSURGXFWVREVHUYHGLQFRQFUHWH
FDQEHIRXQGLQSXEOLFDWLRQVGHDOLQJH[FOXVLYHO\ZLWKWKLVWRSLF HJ>5DKDULQDLYR FDQEHIRXQGLQSXEOLFDWLRQVGHDOLQJH[FOXVLYHO\ZLWKWKLVWRSLF HJ>5DKDULQDLYR
HWDO6DJRH&UHQWVLO *ODVVHU6DQGEHUJ.ROHYDHWDO HWDO6DJRH&UHQWVLO *ODVVHU6DQGEHUJ.ROHYDHWDO
&H)U&R  0DUFRWWH  +DQVVRQ @ FRQFHUQLQJ FDUERQ VWHHO RU HJ >ILE &H)U&R  0DUFRWWH  +DQVVRQ @ FRQFHUQLQJ FDUERQ VWHHO RU HJ >ILE
D3RSRY@FRQFHUQLQJ]LQFLQFRQFUHWH PRVWO\ZLWKUHJDUGWRFKORULGH D3RSRY@FRQFHUQLQJ]LQFLQFRQFUHWH PRVWO\ZLWKUHJDUGWRFKORULGH
LQGXFHGFRUURVLRQ%HVLGHVVXFKVRXUFHVOLWHUDWXUHRQPLQHUDOVRURQOLQHPLQHUDO LQGXFHGFRUURVLRQ%HVLGHVVXFKVRXUFHVOLWHUDWXUHRQPLQHUDOVRURQOLQHPLQHUDO
GDWDEDVHV HJ>0LQ'DW0LQ*DO:HE0LQ@ FDQRIWHQEHDS GDWDEDVHV HJ >0LQ'DW  0LQ*DO:HE0LQ@ FDQRIWHQEHDS
SOLHGEHQHILFLDOO\VLQFH VSHFLHV IRUPHGEHWZHHQ GLIIHUHQWHOHPHQWVRIWHQ H[KLELW SOLHGEHQHILFLDOO\VLQFH VSHFLHV IRUPHGEHWZHHQ GLIIHUHQWHOHPHQWVRIWHQ H[KLELW
PLQHUDORJLFDOFKDUDFWHULVWLFVHVSHFLDOO\IRUPHWDOVLQWKHFRQFUHWHHQYLURQPHQW PLQHUDORJLFDOFKDUDFWHULVWLFVHVSHFLDOO\IRUPHWDOVLQWKHFRQFUHWHHQYLURQPHQW

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP

,QSULQFLSOHWKHDERYHOLVWHGVRXUFHVDUHXVHGDVSRVLWLYHLQGLFDWRUVIRUWKHIRUPDWLRQ ,QSULQFLSOHWKHDERYHOLVWHGVRXUFHVDUHXVHGDVSRVLWLYHLQGLFDWRUVIRUWKHIRUPDWLRQ
RIVSHFLHV2XUJHQHUDOFRQFHSWLQWKHSUHVHOHFWLRQRIVSHFLHVEDVHGRQWKHVHVRXUFHVLV RIVSHFLHV2XUJHQHUDOFRQFHSWLQWKHSUHVHOHFWLRQRIVSHFLHVEDVHGRQWKHVHVRXUFHVLV
WKDWLIDWKHUPRG\QDPLFDOO\IDYRXUHGVSHFLHVKDVEHHQREVHUYHGWREHIRUPHG³LQQD WKDWLIDWKHUPRG\QDPLFDOO\IDYRXUHGVSHFLHVKDVEHHQREVHUYHGWREHIRUPHG³LQQD
WXUH´ XQGHU FRPSDUDEOH FRQGLWLRQV LH VLPLODU FKHPLFDO VXEVWDQFHV SUHVVXUH DQG WXUH´ XQGHU FRPSDUDEOH FRQGLWLRQV LH VLPLODU FKHPLFDO VXEVWDQFHV SUHVVXUH DQG
WHPSHUDWXUHWKHVSHFLHVLVWDNHQLQWRDFFRXQWLQWKHHVWDEOLVKPHQWRID3RXUEDL[GLD WHPSHUDWXUHWKHVSHFLHVLVWDNHQLQWRDFFRXQWLQWKHHVWDEOLVKPHQWRID3RXUEDL[GLD
JUDP ,QWKHFDVHRI DEVHQFHRILQIRUPDWLRQRQIRUPDWLRQRIDFHUWDLQVSHFLHVXQGHU JUDP ,QWKHFDVHRI DEVHQFHRILQIRUPDWLRQRQIRUPDWLRQRIDFHUWDLQVSHFLHVXQGHU
LQYHVWLJDWLRQLQWKHDERYHOLVWHGVRXUFHVZHXVHGQHJDWLYHLQGLFDWRUVWRFRQILUPWKDW LQYHVWLJDWLRQLQWKHDERYHOLVWHGVRXUFHVZHXVHGQHJDWLYHLQGLFDWRUVWRFRQILUPWKDW
WKLV FHUWDLQ VSHFLHV FDQ EH ³VDIHO\´ H[FOXGHG IURP WKH 3RXUEDL[ GLDJUDP 1HJDWLYH WKLV FHUWDLQ VSHFLHV FDQ EH ³VDIHO\´ H[FOXGHG IURP WKH 3RXUEDL[ GLDJUDP 1HJDWLYH
LQGLFDWRUVLQFOXGHIRULQVWDQFHGHVFULSWLRQVRIKLJKWHPSHUDWXUHRUSODVPDWHFKQLTXH LQGLFDWRUVLQFOXGHIRULQVWDQFHGHVFULSWLRQVRIKLJKWHPSHUDWXUHRUSODVPDWHFKQLTXH
SURFHVVHV ZKLFK DUH QHFHVVDU\ IRU IRUPDWLRQ RI WKH VSHFLHV XQGHU LQYHVWLJDWLRQ LH SURFHVVHV ZKLFK DUH QHFHVVDU\ IRU IRUPDWLRQ RI WKH VSHFLHV XQGHU LQYHVWLJDWLRQ LH
WKDW LWV IRUPDWLRQ UHTXLUHV DQ DFWLYDWLRQ HQHUJ\ WKDW LV RXW RI UDQJH IRU VWHHO LQ FRQ WKDW LWV IRUPDWLRQ UHTXLUHV DQ DFWLYDWLRQ HQHUJ\ WKDW LV RXW RI UDQJH IRU VWHHO LQ FRQ
FUHWH 6XFK QHJDWLYH LQGLFDWRUV FDQ EH IRXQG LQ YDULRXV VRXUFHV HJ LQ VRPH RI WKH FUHWH 6XFK QHJDWLYH LQGLFDWRUV FDQ EH IRXQG LQ YDULRXV VRXUFHV HJ LQ VRPH RI WKH
DERYHPHQWLRQHGWH[WERRNVSXEOLFDWLRQVRURQOLQH DERYHPHQWLRQHGWH[WERRNVSXEOLFDWLRQVRURQOLQH
%HVLGHV WKH DERYH PHQWLRQHG VRXUFHV IRU SRVLWLYH DQG QHJDWLYH LQGLFDWRUV ZH XVHG %HVLGHV WKH DERYH PHQWLRQHG VRXUFHV IRU SRVLWLYH DQG QHJDWLYH LQGLFDWRUV ZH XVHG
RZQH[SHULPHQWDOREVHUYDWLRQVWR YHULI\WKHLQSXWSDUDPHWHUVLHWKHFKRLFHRIHOH RZQH[SHULPHQWDOREVHUYDWLRQVWR YHULI\WKHLQSXWSDUDPHWHUVLHWKHFKRLFHRIHOH
PHQWVDQGWKHSUHVHOHFWLRQRIVSHFLHVDVZHOODVWKHRXWSXWRIWKH3RXUEDL[GLDJUDP PHQWVDQGWKHSUHVHOHFWLRQRIVSHFLHVDVZHOODVWKHRXWSXWRIWKH3RXUEDL[GLDJUDP
,IRQHRUPRUHVSHFLHVDUHGHWHUPLQHGWREHSRWHQWLDOO\IRUPHGE\PHDQVRIWKHDERYH ,IRQHRUPRUHVSHFLHVDUHGHWHUPLQHGWREHSRWHQWLDOO\IRUPHGE\PHDQVRIWKHDERYH
GHVFULEHGDSSURDFKDQGDUHORFDWHGLQWKHVDPHVWDELOLW\GRPDLQDQGQRRWKHULQGLFD GHVFULEHGDSSURDFKDQGDUHORFDWHGLQWKHVDPHVWDELOLW\GRPDLQDQGQRRWKHULQGLFD
WRUVIRUDIDYRXUHGIRUPDWLRQDUHDYDLODEOHZHSUHVHOHFWWKHVSHFLHVZLWKWKHORZHVW WRUVIRUDIDYRXUHGIRUPDWLRQDUHDYDLODEOHZHSUHVHOHFWWKHVSHFLHVZLWKWKHORZHVW
µ¨*I¶YDOXHLHZLWKWKHKLJKHVWWKHUPRG\QDPLFDOO\SUREDELOLW\WREHIRUPHG µ¨*I¶YDOXHLHZLWKWKHKLJKHVWWKHUPRG\QDPLFDOO\SUREDELOLW\WREHIRUPHG
,QWKLVSURMHFWZHDSSOLHGµ+6&¶WRHVWDEOLVKFXVWRP3RXUEDL[GLDJUDPV2XUDSSOLFD ,QWKLVSURMHFWZHDSSOLHGµ+6&¶WRHVWDEOLVKFXVWRP3RXUEDL[GLDJUDPV2XUDSSOLFD
WLRQRIµ+6&¶ZDVOLPLWHGWRLWVWKHUPRG\QDPLFGDWDEDVHDQGRQWKHFDOFXODWLRQRIWKH WLRQRIµ+6&¶ZDVOLPLWHGWRLWVWKHUPRG\QDPLFGDWDEDVHDQGRQWKHFDOFXODWLRQRIWKH
HTXLOLEULD%DVHGRQWKHH[HPSOLILFDWLRQRIWKH3RXUEDL[GLDJUDPLQ6HFWLRQLW HTXLOLEULD%DVHGRQWKHH[HPSOLILFDWLRQRIWKH3RXUEDL[GLDJUDPLQ6HFWLRQLW
LV REYLRXV WKDWWKH UHTXLUHG FDOFXODWLRQV DUH UDWKHU HODERUDWH ZLWKRXW XVLQJ FKHPLFDO LV REYLRXV WKDWWKH UHTXLUHG FDOFXODWLRQV DUH UDWKHU HODERUDWH ZLWKRXW XVLQJ FKHPLFDO
UHDFWLRQDQGHTXLOLEULXPVRIWZDUHHYHQLIOLPLWHGWRSUHVHOHFWHGVSHFLHV UHDFWLRQDQGHTXLOLEULXPVRIWZDUHHYHQLIOLPLWHGWRSUHVHOHFWHGVSHFLHV
$OO FDOFXODWLRQV UHTXLUHG IRU WKH HVWDEOLVKPHQW RI 3RXUEDL[ GLDJUDPV LQ µ+6&¶ DUH $OO FDOFXODWLRQV UHTXLUHG IRU WKH HVWDEOLVKPHQW RI 3RXUEDL[ GLDJUDPV LQ µ+6&¶ DUH
EDVHGRQWKHWKHUPRG\QDPLFSDUDPHWHUVDQG UHODWLRQVLQWURGXFHGLQ6HFWLRQDQG EDVHGRQWKHWKHUPRG\QDPLFSDUDPHWHUV DQG UHODWLRQV LQWURGXFHGLQ6HFWLRQDQG
SHUIRUPHGE\WKHVRFDOOHG67$%&$/URXWLQH7KHWKHRU\EHKLQGWKLVURXWLQHDQGLWV SHUIRUPHGE\WKHVRFDOOHG67$%&$/URXWLQH7KHWKHRU\EHKLQGWKLVURXWLQHDQGLWV
DSSOLFDWLRQ LQ µ+6&¶ LV EH\RQG WKH VFRSH RI WKLV WKHVLV DQG UHIHUHQFH LV PDGH WR DSSOLFDWLRQ LQ µ+6&¶ LV EH\RQG WKH VFRSH RI WKLV WKHVLV DQG UHIHUHQFH LV PDGH WR
>+DXQJ &XHQWDVD+DXQJ &XHQWDVE5RLQH@ >+DXQJ &XHQWDVD+DXQJ &XHQWDVE5RLQH@
7KH67$%&$/URXWLQHGRHVQRWDFFRXQWIRUµ¨*I¶RIWKHLQGLYLGXDOVSHFLHVDQGHV 7KH67$%&$/URXWLQHGRHVQRWDFFRXQWIRUµ¨*I¶RIWKHLQGLYLGXDOVSHFLHVDQGHV
WDEOLVKHV DOO SRVVLEOH HTXLOLEULD RI WKH V\VWHP 6R DV ORQJ DV WKH HTXLOLEULXP FRQGL WDEOLVKHV DOO SRVVLEOH HTXLOLEULD RI WKH V\VWHP 6R DV ORQJ DV WKH HTXLOLEULXP FRQGL
WLRQV DUH IXOILOOHG µ+6&¶ ZLOO SURGXFH D 3RXUEDL[ GLDJUDP GLVUHJDUGLQJ WKH UHDVRQ WLRQV DUH IXOILOOHG µ+6&¶ ZLOO SURGXFH D 3RXUEDL[ GLDJUDP GLVUHJDUGLQJ WKH UHDVRQ
DELOLW\RIWKHSUHVHOHFWHGVSHFLHV 7KHUHIRUHDQDSSURSULDWHSUHVHOHFWLRQRIVSHFLHVLV DELOLW\RIWKHSUHVHOHFWHGVSHFLHV 7KHUHIRUHDQDSSURSULDWHSUHVHOHFWLRQRIVSHFLHVLV
DEVROXWHO\ FUXFLDO IRU WKH HVWDEOLVKPHQW RI DSSURSULDWH DQG UHSUHVHQWDWLYH 3RXUEDL[ DEVROXWHO\ FUXFLDO IRU WKH HVWDEOLVKPHQW RI DSSURSULDWH DQG UHSUHVHQWDWLYH 3RXUEDL[
 

,QFLYLOHQJLQHHULQJWHUPVWKHHVWDEOLVKPHQWRIWKH3RXUEDL[GLDJUDPVFDQEHHJFRPSDUHGWRXVLQJ ,QFLYLOHQJLQHHULQJWHUPVWKHHVWDEOLVKPHQWRIWKH3RXUEDL[GLDJUDPVFDQEHHJFRPSDUHGWRXVLQJ
)(0VRIWZDUHLQVWUXFWXUDODQDO\VLV,QILQLWHHOHPHQWVDQDO\VLVDUHVXOWZLOODOZD\VEHREWDLQHGDV )(0VRIWZDUHLQVWUXFWXUDODQDO\VLV,QILQLWHHOHPHQWVDQDO\VLVDUHVXOWZLOODOZD\VEHREWDLQHGDV
ORQJDVWKHVWDWLFRUG\QDPLFHTXLOLEULDFDQEHIXOILOOHG+RZHYHUWKHUHVXOWRQO\UHIOHFWVWKHDFWXDO ORQJDVWKHVWDWLFRUG\QDPLFHTXLOLEULDFDQEHIXOILOOHG+RZHYHUWKHUHVXOWRQO\UHIOHFWVWKHDFWXDO
EHKDYLRXURIDV\VWHPLIGXHFRQVLGHUDWLRQLVJLYHQWRHJWKHLQSXWRIDSSURSULDWHERXQGDU\FRQGL EHKDYLRXURIDV\VWHPLIGXHFRQVLGHUDWLRQLVJLYHQWRHJWKHLQSXWRIDSSURSULDWHERXQGDU\FRQGL
WLRQVDQGPDWHULDOSURSHUWLHVDVZHOODVWRDUHSUHVHQWDWLYHFKRLFHRIILQLWHHOHPHQWV WLRQVDQGPDWHULDOSURSHUWLHVDVZHOODVWRDUHSUHVHQWDWLYHFKRLFHRIILQLWHHOHPHQWV

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV

GLDJUDPV6LQFHWKH67$%&$/URXWLQHGRHVQRWDFFRXQWIRUWKHPDJQLWXGHRIµ¨*I¶ GLDJUDPV6LQFHWKH67$%&$/URXWLQHGRHVQRWDFFRXQWIRUWKHPDJQLWXGHRIµ¨*I¶
WKHSUHVHOHFWLRQRIVSHFLHVIRUDOO3RXUEDL[GLDJUDPVLQWKLVWKHVLVLVQDUURZHGGRZQ WKHSUHVHOHFWLRQRIVSHFLHVIRUDOO3RXUEDL[GLDJUDPVLQWKLVWKHVLVLVQDUURZHGGRZQ
WR WKH VSHFLHV WKDW DUH QHFHVVDU\ IRU WKH HVWDEOLVKPHQW RI WKH FHUWDLQ 3RXUEDL[ GLD WR WKH VSHFLHV WKDW DUH QHFHVVDU\ IRU WKH HVWDEOLVKPHQW RI WKH FHUWDLQ 3RXUEDL[ GLD
JUDP)RUµ6(3'V¶WKLV PHDQVWKDWRQO\VXFKVSHFLHVQHHGWREHSUHVHOHFWHGZKLFK JUDP)RUµ6(3'V¶WKLV PHDQVWKDWRQO\VXFKVSHFLHVQHHGWREHSUHVHOHFWHGZKLFK
DUH DFWXDOO\ SUHVHQW LQ WKH 3RXUEDL[ GLDJUDP FI IRU LQVWDQFH 7DEOH  DQG )LJXUH DUH DFWXDOO\ SUHVHQW LQ WKH 3RXUEDL[ GLDJUDP FI IRU LQVWDQFH 7DEOH  DQG )LJXUH
 +RZHYHUIRUµ0(3'V¶WKDWPHDQVWKDWDOOVSHFLHVWKDWDUHQHFHVVDU\WRIRUPWKH  +RZHYHUIRUµ0(3'V¶WKDWPHDQVWKDWDOOVSHFLHVWKDWDUHQHFHVVDU\WRIRUPWKH
SUHVHOHFWHGVSHFLHV LQFOXGLQJDOOFRPELQHGVSHFLHV DVZHOODVWKHLUDVVRFLDWHGHTXL SUHVHOHFWHGVSHFLHV LQFOXGLQJDOOFRPELQHGVSHFLHV DVZHOODVWKHLUDVVRFLDWHGHTXL
OLEULXPOLQHV DUHSUHVHOHFWHG FIIRULQVWDQFH7DEOHDQG)LJXUH>&@LQ6HFWLRQ OLEULXPOLQHV DUHSUHVHOHFWHG FIIRULQVWDQFH7DEOHDQG)LJXUH>&@LQ6HFWLRQ
RU7DEOHDQG)LJXUH>%@LQ6HFWLRQ 6RLQWKLVWKHVLVWKH7DEOHV RU7DEOHDQG)LJXUH>%@LQ6HFWLRQ 6RLQWKLVWKHVLVWKH7DEOHV
WKDW LQWURGXFH WKH SUHVHOHFWHG VSHFLHV RI WKH DVVRFLDWHG 3RXUEDL[ GLDJUDP GR E\ QR WKDW LQWURGXFH WKH SUHVHOHFWHG VSHFLHV RI WKH DVVRFLDWHG 3RXUEDL[ GLDJUDP GR E\ QR
PHDQVUHSUHVHQWDOOWKHUPRG\QDPLFDOO\SRVVLEOHRUIDYRXUHGVSHFLHV,QSDUWLFXODUIRU PHDQVUHSUHVHQWDOOWKHUPRG\QDPLFDOO\SRVVLEOHRUIDYRXUHGVSHFLHV,QSDUWLFXODUIRU
µ0(3'V¶WKHDPRXQWRIWKHUPRG\QDPLFDOO\IDYRXUHGVSHFLHVFDQEHLQWKHUDQJHRI µ0(3'V¶WKHDPRXQWRIWKHUPRG\QDPLFDOO\IDYRXUHGVSHFLHVFDQEHLQWKHUDQJHRI
VHYHUDOGHFDGHVZKLOHWKHDPRXQWRIVSHFLHVWKDWZHFRQVLGHUWRSOD\DUROHLQWKHV\V VHYHUDOGHFDGHVZKLOHWKHDPRXQWRIVSHFLHVWKDWZHFRQVLGHUWRSOD\DUROHLQWKHV\V
WHPXQGHULQYHVWLJDWLRQFDQJHQHUDOO\EHQDUURZHGGRZQWRDPD[LPXPRIHJWHQ WHPXQGHULQYHVWLJDWLRQFDQJHQHUDOO\EHQDUURZHGGRZQWRDPD[LPXPRIHJWHQ
$ ILQDO LPSRUWDQW LVVXH LQ WKH DSSOLFDWLRQ RI 3RXUEDL[ GLDJUDPV LV WKH FKRLFH RI LRQ $ ILQDO LPSRUWDQW LVVXH LQ WKH DSSOLFDWLRQ RI 3RXUEDL[ GLDJUDPV LV WKH FKRLFH RI LRQ
DFWLYLWLHVIRUWKHHOHPHQWVWREHLQYHVWLJDWHG$VPHQWLRQHGLQ6HFWLRQZKHUH DFWLYLWLHVIRUWKHHOHPHQWVWREHLQYHVWLJDWHG$VPHQWLRQHGLQ6HFWLRQZKHUH
WKH3RXUEDL[GLDJUDPZDVLQWURGXFHGWKHFRQVHUYDWLYHFKRLFHIRUWKHLURQLRQDFWLYLW\ WKH3RXUEDL[GLDJUDPZDVLQWURGXFHGWKHFRQVHUYDWLYHFKRLFHIRUWKHLURQLRQDFWLYLW\
IRUSDVVLYLW\LQWKHDVVRFLDWHGVWDELOLW\GRPDLQVLVíPRO/IRUWKH)H+2V\VWHP IRUSDVVLYLW\LQWKHDVVRFLDWHGVWDELOLW\GRPDLQVLVíPRO/IRUWKH)H+2V\VWHP
7KHµ6(3'¶IRUWKLVFKRLFHRILURQLRQDFWLYLW\LVVKRZQLQ)LJXUH>$@ZKLFKLV 7KHµ6(3'¶IRUWKLVFKRLFHRILURQLRQDFWLYLW\LVVKRZQLQ)LJXUH>$@ZKLFKLV
LGHQWLFDOZLWKWKH3RXUEDL[GLDJUDPDQGWKHSUHVHOHFWLRQRIVSHFLHVDVXVHGIRULQWUR LGHQWLFDOZLWKWKH3RXUEDL[GLDJUDPDQGWKHSUHVHOHFWLRQRIVSHFLHVDVXVHGIRULQWUR
GXFWLRQWRWKHWKHRU\RIWKH3RXUEDL[GLDJUDPLQ6HFWLRQ7KHVDPHKROGVIRU GXFWLRQWRWKHWKHRU\RIWKH3RXUEDL[GLDJUDPLQ6HFWLRQ7KHVDPHKROGVIRU
7DEOHZKLFKOLVWVWKHSUHVHOHFWHGVROLGDQGVROXEOHVSHFLHV 7DEOHZKLFKOLVWVWKHSUHVHOHFWHGVROLGDQGVROXEOHVSHFLHV
7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ6(3'¶RIWKHJHQHUDO)H+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ6(3'¶RIWKHJHQHUDO)H+2V\VWHP

6ROLG )H )H2 )H2 6ROLG )H )H2 )H2


  í  
6ROXEOH )H  )H  +)H2  6ROXEOH )H  )H  +)H2í
 

 
)LJXUH )H+2 µ6(3'V¶ EDVHG RQ 7DEOH  DQG GLIIHUHQW )HLD >$@ )HLD  )LJXUH )H+2 µ6(3'V¶ EDVHG RQ 7DEOH  DQG GLIIHUHQW )HLD >$@ )HLD 
í PRO/ DV FRQVHUYDWLYH YDOXH IRU SDVVLYH VWDELOLW\ GRPDLQV >%@ í PRO/ DV FRQVHUYDWLYH YDOXH IRU SDVVLYH VWDELOLW\ GRPDLQV >%@
)HLD íPRO/ >&@)HLDĺPRO/LHSUHGRPLQDQFHGRPDLQVRI )HLD íPRO/ >&@)HLDĺPRO/LHSUHGRPLQDQFHGRPDLQVRI
LURQLRQV'LDJUDPV>%@DQG>&@DUHIRUH[HPSOLILFDWLRQSXUSRVHVRQO\ LURQLRQV'LDJUDPV>%@DQG>&@DUHIRUH[HPSOLILFDWLRQSXUSRVHVRQO\
DQGGRQRWUHSUHVHQWDFWXDOFRQGLWLRQV DQGGRQRWUHSUHVHQWDFWXDOFRQGLWLRQV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP

%DVHG RQ WKH 1HUQVW HTXDWLRQ DQG WKH WKHRU\ RI WKH 3RXUEDL[ GLDJUDP LQ 6HFWLRQ %DVHG RQ WKH 1HUQVW HTXDWLRQ DQG WKH WKHRU\ RI WKH 3RXUEDL[ GLDJUDP LQ 6HFWLRQ
LWFRXOGEHFRQFOXGHGWKDWDGHFUHDVHLQLURQLRQDFWLYLW\EHORZíPRO/DI LWFRXOGEHFRQFOXGHGWKDWDGHFUHDVHLQLURQLRQDFWLYLW\EHORZíPRO/DI
IHFWV WKH 3RXUEDL[ GLDJUDP E\ LQFUHDVLQJ WKH VWDELOLW\ GRPDLQV RI WKH VROXEOH FRP IHFWV WKH 3RXUEDL[ GLDJUDP E\ LQFUHDVLQJ WKH VWDELOLW\ GRPDLQV RI WKH VROXEOH FRP
SRXQGVRQH[SHQVHRIWKHGRPDLQVRIVROLGFRPSRXQGV)LJXUH>%@H[HPSOLILHVWKH SRXQGVRQH[SHQVHRIWKHGRPDLQVRIVROLGFRPSRXQGV)LJXUH>%@H[HPSOLILHVWKH
WKHRUHWLFDOFRQVHTXHQFHIRUWKH)H+2µ6(3'¶EDVHGRQ)HLD íPRO/DQGWKH WKHRUHWLFDOFRQVHTXHQFHIRUWKH)H+2µ6(3'¶EDVHGRQ)HLD íPRO/DQGWKH
UHVXOWRI)HLDĺPRO/ZKLFKFRUUHVSRQGVWRWKHSUHGRPLQDQFHGRPDLQVRILRQVLQ UHVXOWRI)HLDĺPRO/ZKLFKFRUUHVSRQGVWRWKHSUHGRPLQDQFHGRPDLQVRILRQVLQ
WKH)H+2V\VWHPLVLOOXVWUDWHGLQ)LJXUH>&@+RZHYHUWKHGLDJUDPVLQ)LJXUH WKH)H+2V\VWHPLVLOOXVWUDWHGLQ)LJXUH>&@+RZHYHUWKHGLDJUDPVLQ)LJXUH
>%@DQG>&@DUHIRUWKHWKHRUHWLFDOH[HPSOLILFDWLRQSXUSRVHRQO\DQGRI QRSUDFWL >%@DQG>&@DUHIRUWKHWKHRUHWLFDOH[HPSOLILFDWLRQSXUSRVHRQO\DQGRI QRSUDFWL
FDOUHOHYDQFHLQWKLVWKHVLV%DVHGRQWKHOLWHUDWXUHDQGRQRZQREVHUYDWLRQVZHFRQ FDOUHOHYDQFHLQWKLVWKHVLV%DVHGRQWKHOLWHUDWXUHDQGRQRZQREVHUYDWLRQVZHFRQ
VLGHUWKH)H+23RXUEDL[GLDJUDPIRUDQLRQDFWLYLW\RIíPRO/WREHDUHDVRQ VLGHUWKH)H+23RXUEDL[GLDJUDPIRUDQLRQDFWLYLW\RIíPRO/WREHDUHDVRQ
DEOHORZHUOLPLWIRUWKHWKHUPRG\QDPLFDOO\IDYRXUHGIRUPDWLRQRIR[LGHOD\HUVLQWKH DEOHORZHUOLPLWIRUWKHWKHUPRG\QDPLFDOO\IDYRXUHGIRUPDWLRQRIR[LGHOD\HUVLQWKH
DVVRFLDWHGVWDELOLW\GRPDLQV$GHWDLOHGGLVFXVVLRQRQWKLVWRSLFLVEH\RQGWKHVFRSH DVVRFLDWHGVWDELOLW\GRPDLQV$GHWDLOHGGLVFXVVLRQRQWKLVWRSLFLVEH\RQGWKHVFRSH
RIWKLVWKHVLVEXWWKHWKHRUHWLFDOYDOXHKDVEHHQYHULILHGDQGFDOLEUDWHGIRUFRUURVLRQLQ RIWKLVWKHVLVEXWWKHWKHRUHWLFDOYDOXHKDVEHHQYHULILHGDQGFDOLEUDWHGIRUFRUURVLRQLQ
DTXHRXVVROXWLRQE\PHDQVRIDQH[WHQVLYHUHVHDUFKSURJUDPEDVHGRQHJSRODULVD DTXHRXVVROXWLRQE\PHDQVRIDQH[WHQVLYHUHVHDUFKSURJUDPEDVHGRQHJSRODULVD
WLRQ FXUYHV DQG VWXGLHV RQ R[LGH VROXELOLWLHV >3RXUEDL[ E@ ZKLFK IXUWKHUPRUH WLRQ FXUYHV DQG VWXGLHV RQ R[LGH VROXELOLWLHV >3RXUEDL[ E@ ZKLFK IXUWKHUPRUH
LOOXVWUDWHVWKHLPSRUWDQFHRINLQHWLFVLQWKHUPRG\QDPLFFRQVLGHUDWLRQV LOOXVWUDWHVWKHLPSRUWDQFHRINLQHWLFVLQWKHUPRG\QDPLFFRQVLGHUDWLRQV
6RPHPHWDOVUHTXLUHRWKHUFRQVLGHUDWLRQVEXWDQLRQDFWLYLW\RIíPRO/KDVDOVR 6RPHPHWDOVUHTXLUHRWKHUFRQVLGHUDWLRQVEXWDQLRQDFWLYLW\RIíPRO/KDVDOVR
EHHQGHWHUPLQHGWREHDUHDVRQDEOHFRQVHUYDWLYHYDOXHIRUIRUPDWLRQRISDVVLYHOD\HUV EHHQGHWHUPLQHGWREHDUHDVRQDEOHFRQVHUYDWLYHYDOXHIRUIRUPDWLRQRISDVVLYHOD\HUV
LQ WKH DVVRFLDWHG VWDELOLW\ GRPDLQV IRU ]LQF DQG PDJQHVLXP >3RXUEDL[ E@ 7KH LQ WKH DVVRFLDWHG VWDELOLW\ GRPDLQV IRU ]LQF DQG PDJQHVLXP >3RXUEDL[ E@ 7KH
HOHFWURFKHPLVWU\RIWKHVHWZRPHWDOVLVRIPDMRULPSRUWDQFHLQWKHFRQVLGHUDWLRQVIRU HOHFWURFKHPLVWU\RIWKHVHWZRPHWDOVLVRIPDMRULPSRUWDQFHLQWKHFRQVLGHUDWLRQVIRU
WKHSURSRVHGQHZFRXQWHUPHDVXUHV FI6HFWLRQ  WKHSURSRVHGQHZFRXQWHUPHDVXUHV FI6HFWLRQ 
6RDVDEDVLVIRUDOOIROORZLQJFRQVLGHUDWLRQVLQWKLVWKHVLVZHDVVXPHWKDWWKHSDV 6RDVDEDVLVIRUDOOIROORZLQJFRQVLGHUDWLRQVLQWKLVWKHVLVZHDVVXPHWKDWWKHSDV
VLYHGRPDLQVLQGLFDWHGLQWKH3RXUEDL[GLDJUDPVIRULURQ]LQFDQGPDJQHVLXPEDVHG VLYHGRPDLQVLQGLFDWHGLQWKH3RXUEDL[GLDJUDPVIRULURQ]LQFDQGPDJQHVLXPEDVHG
RQLRQDFWLYLWLHVRIíPRO/UHSUHVHQWWKHDFWXDOSDVVLYHGRPDLQVRIWKHVHPHWDOV RQLRQDFWLYLWLHVRIíPRO/UHSUHVHQWWKHDFWXDOSDVVLYHGRPDLQVRIWKHVHPHWDOV
7KLVPHDQVLQSUDFWLFHWKDWLIDSLHFHRISXUHLURQ]LQFRUPDJQHVLXPLVVXEPHUJHGLQ 7KLVPHDQVLQSUDFWLFHWKDWLIDSLHFHRISXUHLURQ]LQFRUPDJQHVLXPLVVXEPHUJHGLQ
DQ XQOLPLWHGVXSSO\RI +2 FRQWDLQLQJ QRQH RI WKHLU LRQVWKHVHPHWDOV DW OHDVWSDV DQ XQOLPLWHGVXSSO\RI +2 FRQWDLQLQJ QRQH RI WKHLU LRQVWKHVHPHWDOV DW OHDVWSDV
VLYDWHLQWKHVWDELOLW\GRPDLQVGHWHUPLQHGE\WKH3RXUEDL[GLDJUDPRIWKHUHVSHFWLYH VLYDWHLQWKHVWDELOLW\GRPDLQVGHWHUPLQHGE\WKH3RXUEDL[GLDJUDPRIWKHUHVSHFWLYH
0H+2V\VWHPZLWKDQLRQDFWLYLW\RIíPRO/ 0H+2V\VWHPZLWKDQLRQDFWLYLW\RIíPRO/
+RZHYHU ZH SRVWXODWH WKDW FRQWUDU\ WR WKLV OLPLWDWLRQ RI WKH 3RXUEDL[ GLDJUDP ZLWK +RZHYHU ZH SRVWXODWH WKDW FRQWUDU\ WR WKLV OLPLWDWLRQ RI WKH 3RXUEDL[ GLDJUDP ZLWK
GHFUHDVLQJWKHLRQDFWLYLW\EHORZíPRO/ QRVXFKOLPLWDWLRQDSSOLHVWRWKH3RXU GHFUHDVLQJWKHLRQDFWLYLW\EHORZíPRO/ QRVXFKOLPLWDWLRQDSSOLHVWRWKH3RXU
EDL[GLDJUDPZLWKLQFUHDVLQJLRQDFWLYLW\DERYHíPRO/ EDL[GLDJUDPZLWKLQFUHDVLQJLRQDFWLYLW\DERYHíPRO/
,QRWKHUZRUGVZHDVVXPHWKDWWKHHTXLOLEULXPOLQHVLQWKH3RXUEDL[GLDJUDPZLWKLQ ,QRWKHUZRUGVZHDVVXPHWKDWWKHHTXLOLEULXPOLQHVLQWKH3RXUEDL[GLDJUDPZLWKLQ
FUHDVLQJ LRQ DFWLYLW\ DERYH í PRO/ DUH ZLWKRXW H[FHSWLRQV GHWHUPLQHG E\ WKH FUHDVLQJ LRQ DFWLYLW\ DERYH í PRO/ DUH ZLWKRXW H[FHSWLRQV GHWHUPLQHG E\ WKH
1HUQVWHTXDWLRQ FI6HFWLRQ 7KLVLVH[HPSOLILHGLQ)LJXUHZKLFKVKRZV 1HUQVWHTXDWLRQ FI6HFWLRQ 7KLVLVH[HPSOLILHGLQ)LJXUHZKLFKVKRZV
WKHHIIHFWRILQFUHDVLQJWKHLURQLRQDFWLYLW\LQWKH)H+2µ6(3'¶IURPíPRO/ WKHHIIHFWRILQFUHDVLQJWKHLURQLRQDFWLYLW\LQWKH)H+2µ6(3'¶IURPíPRO/
)LJXUH>$@ WRíPRO/ )LJXUH>%@ DQGWRPRO/ )LJXUH>&@  )LJXUH>$@ WRíPRO/ )LJXUH>%@ DQGWRPRO/ )LJXUH>&@ 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV

 
)LJXUH )H+2µ6(3'V¶EDVHGRQ7DEOHZLWK)HLD>$@)HLD íPRO/ )LJXUH )H+2µ6(3'V¶EDVHGRQ7DEOHZLWK)HLD>$@)HLD íPRO/
>%@)HLD íPRO/>&@)HLD PRO/ >%@)HLD íPRO/>&@)HLD PRO/
,QWKHµ6(3'V¶LQ)LJXUHLWFDQEHREVHUYHGWKDWWKHLPPXQHDQGSDVVLYHGRPDLQV ,QWKHµ6(3'V¶LQ)LJXUHLWFDQEHREVHUYHGWKDWWKHLPPXQHDQGSDVVLYHGRPDLQV
HQODUJHZLWKLQFUHDVLQJLURQLRQDFWLYLW\DWWKHLURQHOHFWURO\WHLQWHUIDFHRQH[SHQVHRI HQODUJHZLWKLQFUHDVLQJLURQLRQDFWLYLW\DWWKHLURQHOHFWURO\WHLQWHUIDFHRQH[SHQVHRI
WKHFRUURVLRQGRPDLQV%DVHGRQWKLVWKHUPRG\QDPLFDVSHFWLWFDQEHFRQFOXGHGWKDW WKHFRUURVLRQGRPDLQV%DVHGRQWKLVWKHUPRG\QDPLFDVSHFWLWFDQEHFRQFOXGHGWKDW
WKHHOHFWURFKHPLVWU\RIWKH)H+2V\VWHPFDQEHODUJHO\LQIOXHQFHGE\WKHLURQLRQ WKHHOHFWURFKHPLVWU\RIWKH)H+2V\VWHPFDQEHODUJHO\LQIOXHQFHGE\WKHLURQLRQ
DFWLYLW\DWWKHLURQHOHFWURO\WHLQWHUIDFH,Q&KDSWHULWLVVKRZQWKDWWKHVDPHKROGV DFWLYLW\DWWKHLURQHOHFWURO\WHLQWHUIDFH,Q&KDSWHULWLVVKRZQWKDWWKHVDPHKROGV
IRU]LQFDQGPDJQHVLXP:HWKLQNWKDWWKLVLVDFHQWUDODVSHFWLQWKHGHVFULSWLRQRIUH IRU]LQFDQGPDJQHVLXP:HWKLQNWKDWWKLVLVDFHQWUDODVSHFWLQWKHGHVFULSWLRQRIUH
LQIRUFHPHQWFRUURVLRQDQGLQWKHGHVLJQRIFRXQWHUPHDVXUHVZKLFKDSSHDUVWREHGLV LQIRUFHPHQWFRUURVLRQDQGLQWKHGHVLJQRIFRXQWHUPHDVXUHVZKLFKDSSHDUVWREHGLV
UHJDUGHG'LIIHUHQWWRPHWDOVGLUHFWO\H[SRVHGWRWKHHQYLURQPHQWPHWDOVLQFRQFUHWH UHJDUGHG'LIIHUHQWWRPHWDOVGLUHFWO\H[SRVHGWRWKHHQYLURQPHQWPHWDOVLQFRQFUHWH
EHQHILWIURPWKH ³EXLOWLQ´GLIIXVLRQFRQWURORIWKHFRQFUHWH:HWKLQNWKDWWKHUHDUH EHQHILWIURPWKH ³EXLOWLQ´GLIIXVLRQFRQWURORIWKHFRQFUHWH:HWKLQNWKDWWKHUHDUH
GLIIHUHQWZD\VRIIXUWKHULPSURYLQJWKHGLIIXVLRQOLPLWDWLRQVRIPHWDOLRQVDQGRWKHU GLIIHUHQWZD\VRIIXUWKHULPSURYLQJWKHGLIIXVLRQOLPLWDWLRQVRIPHWDOLRQVDQGRWKHU
LRQVDWWKHFRQFUHWHPHWDOLQWHUIDFH7KLVLVDFHQWUDODVSHFWLQWKHXQGHUO\LQJSULQFL LRQVDWWKHFRQFUHWHPHWDOLQWHUIDFH7KLVLVDFHQWUDODVSHFWLQWKHXQGHUO\LQJSULQFL
SOHVRIWKHSURSRVHGQHZFRXQWHUPHDVXUHVZKLFKDUHGLVFXVVHGLQGHWDLOLQ&KDSWHU SOHVRIWKHSURSRVHGQHZFRXQWHUPHDVXUHVZKLFKDUHGLVFXVVHGLQGHWDLOLQ&KDSWHU
$SDUWIURPLQIRUPDWLRQRQWKHFRPSRVLWLRQRISRUHVROXWLRQV FI7DEOHLQ6HFWLRQ $SDUWIURPLQIRUPDWLRQRQWKHFRPSRVLWLRQRISRUHVROXWLRQV FI7DEOHLQ6HFWLRQ
 QRH[SHULPHQWDOGDWDLVDYDLODEOHWRHYDOXDWHWKHHIIHFWRIWKHFRQFHQWUDWLRQVRI  QRH[SHULPHQWDOGDWDLVDYDLODEOHWRHYDOXDWHWKHHIIHFWRIWKHFRQFHQWUDWLRQVRI
GLIIHUHQWVSHFLHVLQWKHFRQFUHWHZLWKUHJDUGWRWKHHOHFWURFKHPLVWU\RIWKHHPEHGGHG GLIIHUHQWVSHFLHVLQWKHFRQFUHWHZLWKUHJDUGWRWKHHOHFWURFKHPLVWU\RIWKHHPEHGGHG
VWHHO RU PRUH JHQHUDO WKH HPEHGGHG PHWDO :H WKLQN WKDW LW LV LPSRUWDQW WR UHDOLVH VWHHO RU PRUH JHQHUDO WKH HPEHGGHG PHWDO :H WKLQN WKDW LW LV LPSRUWDQW WR UHDOLVH
WKDWWKHHQYLURQPHQWWKDWDFWXDOO\DIIHFWVWKHHOHFWURFKHPLVWU\RIDPHWDOHPEHGGHGLQ WKDWWKHHQYLURQPHQWWKDWDFWXDOO\DIIHFWVWKHHOHFWURFKHPLVWU\RIDPHWDOHPEHGGHGLQ
FRQFUHWH FRUUHVSRQGV WR WKH PLFURHQYLURQPHQWDO FRQGLWLRQV LH WKH ORFDO HQYLURQ FRQFUHWH FRUUHVSRQGV WR WKH PLFURHQYLURQPHQWDO FRQGLWLRQV LH WKH ORFDO HQYLURQ
PHQWDWWKHFRQFUHWHPHWDOLQWHUIDFH,WLVNQRZQWKDWIRUPHWDOOLFFRUURVLRQLQDTXHRXV PHQWDWWKHFRQFUHWHPHWDOLQWHUIDFH,WLVNQRZQWKDWIRUPHWDOOLFFRUURVLRQLQDTXHRXV
VROXWLRQVWKHHOHFWURO\WHFRPSRVLWLRQDWWKHPHWDOVXUIDFHODUJHO\GLIIHUVIURPWKHRQH VROXWLRQVWKHHOHFWURO\WHFRPSRVLWLRQDWWKHPHWDOVXUIDFHODUJHO\GLIIHUVIURPWKHRQH
RIWKHEXONHOHFWURO\WH FI6HFWLRQ DQGGXHWRWKHOLPLWHGWUDQVSRUWDQGPRELOLW\ RIWKHEXONHOHFWURO\WH FI6HFWLRQ DQGGXHWRWKHOLPLWHGWUDQVSRUWDQGPRELOLW\
RIVSHFLHV FI6HFWLRQ ZHFRQVLGHUWKLVHIIHFWWREHHYHQPRUHSURQRXQFHGLQ RIVSHFLHV FI6HFWLRQ ZHFRQVLGHUWKLVHIIHFWWREHHYHQPRUHSURQRXQFHGLQ
FDVH RI FRUURVLRQ RI PHWDOV LQ FRQFUHWH 0RUHRYHU WKH HQYLURQPHQW DW WKH FRQFUHWH FDVH RI FRUURVLRQ RI PHWDOV LQ FRQFUHWH 0RUHRYHU WKH HQYLURQPHQW DW WKH FRQFUHWH
PHWDO LQWHUIDFH LV D WLPH GHSHQGHQW YDULDEOH WKDW ODUJHO\ FKDQJHV ZLWK WKH HOHFWUR PHWDO LQWHUIDFH LV D WLPH GHSHQGHQW YDULDEOH WKDW ODUJHO\ FKDQJHV ZLWK WKH HOHFWUR
FKHPLFDOFRQGLWLRQVLHWKHUHDFWLRQVDOWHUWKHHQYLURQPHQWDQGYLFHYHUVDDQGFRQ FKHPLFDOFRQGLWLRQVLHWKHUHDFWLRQVDOWHUWKHHQYLURQPHQWDQGYLFHYHUVDDQGFRQ
VLGHUDEOHFRQFHQWUDWLRQJUDGLHQWVPD\EHGHYHORSHGLQSDUWLFXODUDIWHUFRUURVLRQLQL VLGHUDEOHFRQFHQWUDWLRQJUDGLHQWVPD\EHGHYHORSHGLQSDUWLFXODUDIWHUFRUURVLRQLQL
WLDWLRQ)RULQVWDQFHLQFDVHRIFKORULGHLQGXFHGFRUURVLRQLQXQFUDFNHGFRQFUHWHWKH WLDWLRQ)RULQVWDQFHLQFDVHRIFKORULGHLQGXFHGFRUURVLRQLQXQFUDFNHGFRQFUHWHWKH
FKORULGHWKUHVKROGFDQEHUHODWLYHO\SUHFLVHO\DVVHVVHGIRUDJLYHQFRQFUHWHFRPSRVL FKORULGHWKUHVKROGFDQEHUHODWLYHO\SUHFLVHO\DVVHVVHGIRUDJLYHQFRQFUHWHFRPSRVL
WLRQFRQFUHWHVWHHOLQWHUIDFHSURSHUWLHVDQGH[SRVXUHFRQGLWLRQVFI&KDSWHU+RZ WLRQFRQFUHWHVWHHOLQWHUIDFHSURSHUWLHVDQGH[SRVXUHFRQGLWLRQVFI&KDSWHU+RZ
HYHUDVGHVFULEHGLQPRUHGHWDLOLQ6HFWLRQDIWHUFRUURVLRQLQLWLDWLRQFRUURVLRQ HYHUDVGHVFULEHGLQPRUHGHWDLOLQ6HFWLRQDIWHUFRUURVLRQLQLWLDWLRQFRUURVLRQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP

SLWVH[SHULHQFHGUDVWLFFKDQJHVLQWKHS+DQGFKORULGHFRQFHQWUDWLRQVRWKDWWKHH[DFW SLWVH[SHULHQFHGUDVWLFFKDQJHVLQWKHS+DQGFKORULGHFRQFHQWUDWLRQVRWKDWWKHH[DFW
FRQGLWLRQVFDQQRWEHSUHGLFWHG7KHUHIRUHZHGHFLGHGWREDVHRXUWKHRUHWLFDOFRQVLG FRQGLWLRQVFDQQRWEHSUHGLFWHG7KHUHIRUHZHGHFLGHGWREDVHRXUWKHRUHWLFDOFRQVLG
HUDWLRQVZKLFKUHODWHWRWKHHIIHFWRILRQDFWLYLW\FKDQJHVRQDUDWKHUODUJHVFDOHRI HUDWLRQVZKLFKUHODWHWRWKHHIIHFWRILRQDFWLYLW\FKDQJHVRQDUDWKHUODUJHVFDOHRI
LRQDFWLYLWLHVDVJLYHQLQ7DEOH LRQDFWLYLWLHVDVJLYHQLQ7DEOH
7DEOH 0RODUPDVVHV>2XNX2XNX:HE(OH@DQGLRQDFWLYL 7DEOH 0RODUPDVVHV>2XNX2XNX:HE(OH@DQGLRQDFWLYL
WLHVLQPRO/DQGPJ/WDNHQLQWRFRQVLGHUDWLRQLQ3RXUEDL[GLDJUDPVWR WLHVLQPRO/DQGPJ/WDNHQLQWRFRQVLGHUDWLRQLQ3RXUEDL[GLDJUDPVWR
HYDOXDWHWKHHIIHFWRIFKDQJHVLQWKHLRQDFWLYLW\ HYDOXDWHWKHHIIHFWRIFKDQJHVLQWKHLRQDFWLYLW\

,RQDFWLYLW\LQ3RXUEDL[GLDJUDPV ,RQDFWLYLW\LQ3RXUEDL[GLDJUDPV
0RODUPDVV í í
0RODUPDVV í
(OHPHQW  PRO/  PRO/ PRO/ (OHPHQW  PRO/ íPRO/ PRO/
JPRO PJ/ JPRO PJ/
)H     )H    
=Q     =Q    
0J     0J    
&D     &D    
&     &    
&O     &O    
 
,QFRQFOXVLRQZHFRQVLGHUWKDW3RXUEDL[GLDJUDPVHVWDEOLVKHGRQWKHDERYHGHVFULEHG ,QFRQFOXVLRQZHFRQVLGHUWKDW3RXUEDL[GLDJUDPVHVWDEOLVKHGRQWKHDERYHGHVFULEHG
FRQVLGHUDWLRQV WR EH D FRPSUHKHQVLYH DQG FRQYHQLHQW WRRO IRU WKH LOOXVWUDWLRQ RI WKH FRQVLGHUDWLRQV WR EH D FRPSUHKHQVLYH DQG FRQYHQLHQW WRRO IRU WKH LOOXVWUDWLRQ RI WKH
FRUURVLRQWHQGHQFLHV(YHQLIWKHDVVXPHGLRQDFWLYLWLHVGRQRWUHIOHFWWKHDFWXDOVLWXD FRUURVLRQWHQGHQFLHV(YHQLIWKHDVVXPHGLRQDFWLYLWLHVGRQRWUHIOHFWWKHDFWXDOVLWXD
WLRQRIWKHV\VWHPWKH\JLYHDFOHDULQGLFDWLRQRIWKHJRYHUQLQJSDUDPHWHUVIRULPPX WLRQRIWKHV\VWHPWKH\JLYHDFOHDULQGLFDWLRQRIWKHJRYHUQLQJSDUDPHWHUVIRULPPX
QLW\SDVVLYLW\DQGFRUURVLRQLQWKHV\VWHPXQGHULQYHVWLJDWLRQJLYHQWKDWWKH3RXU QLW\SDVVLYLW\DQGFRUURVLRQLQWKHV\VWHPXQGHULQYHVWLJDWLRQ JLYHQ WKDW WKH3RXU
EDL[GLDJUDPUHSUHVHQWVDOOIDFWRUVWKDWFDQKDYHDQHIIHFWRQWKHDVVRFLDWHGVWDELOLW\ EDL[GLDJUDPUHSUHVHQWVDOOIDFWRUVWKDWFDQKDYHDQHIIHFWRQWKHDVVRFLDWHGVWDELOLW\
GRPDLQV :H WKLQN WKDW WKHVH SDUDPHWHUV LQGLFDWH KRZ WKH FRQGLWLRQV LQ WKH V\VWHP GRPDLQV :H WKLQN WKDW WKHVH SDUDPHWHUV LQGLFDWH KRZ WKH FRQGLWLRQV LQ WKH V\VWHP
FDQEHPDQLSXODWHGWRPDNHFRUURVLRQWKHUPRG\QDPLFDOO\LPSRVVLEOH FDQEHPDQLSXODWHGWRPDNHFRUURVLRQWKHUPRG\QDPLFDOO\LPSRVVLEOH
,WVKRXOGEHHPSKDVLVHGKRZHYHUWKDWDOOLQIRUPDWLRQWKDWFDQEHREWDLQHGIURPWKH ,WVKRXOGEHHPSKDVLVHGKRZHYHUWKDWDOOLQIRUPDWLRQWKDWFDQEHREWDLQHGIURPWKH
3RXUEDL[GLDJUDPDQGDFFRUGLQJO\FRQFOXVLRQVGUDZQXSRQWKDWLQIRUPDWLRQGHSHQG 3RXUEDL[GLDJUDPDQGDFFRUGLQJO\FRQFOXVLRQVGUDZQXSRQWKDWLQIRUPDWLRQGHSHQG
RQWKHXQGHUO\LQJDVVXPSWLRQV7KXVWKH3RXUEDL[GLDJUDPLVRQO\RIEHQHILWLIWKHVH RQWKHXQGHUO\LQJDVVXPSWLRQV7KXVWKH3RXUEDL[GLDJUDPLVRQO\RIEHQHILWLIWKHVH
DVVXPSWLRQVDSSO\WRWKHV\VWHPXQGHULQYHVWLJDWLRQRWKHUZLVHWKHGLDJUDPLVPHDQ DVVXPSWLRQVDSSO\WRWKHV\VWHPXQGHULQYHVWLJDWLRQRWKHUZLVHWKHGLDJUDPLVPHDQ
LQJOHVV LQJOHVV

 $SSOLFDELOLW\RI3RXUEDL['LDJUDPIRU&RQFUHWH6WHHO6\VWHP  $SSOLFDELOLW\RI3RXUEDL['LDJUDPIRU&RQFUHWH6WHHO6\VWHP


,Q WKLV 6HFWLRQ WKH PRVW LPSRUWDQW DVSHFWV ZKLFK ZH FRQVLGHUHG ZLWK UHJDUG WR WKH ,Q WKLV 6HFWLRQ WKH PRVW LPSRUWDQW DVSHFWV ZKLFK ZH FRQVLGHUHG ZLWK UHJDUG WR WKH
YDOLGLW\ RI WKH 3RXUEDL[ GLDJUDP IRU WKH GHVFULSWLRQ RI WKH HOHFWURFKHPLVWU\ RI WKH YDOLGLW\ RI WKH 3RXUEDL[ GLDJUDP IRU WKH GHVFULSWLRQ RI WKH HOHFWURFKHPLVWU\ RI WKH
FRQFUHWHVWHHOV\VWHPDUHVXPPDULVHG FRQFUHWHVWHHOV\VWHPDUHVXPPDULVHG
&RQFHUQVFRXOGEHUDLVHGDVWRWKHYDOLGLW\RIWKH3RXUEDL[GLDJUDPIRUWKHGHVFULSWLRQ &RQFHUQVFRXOGEHUDLVHGDVWRWKHYDOLGLW\RIWKH3RXUEDL[GLDJUDPIRUWKHGHVFULSWLRQ
RIWKHHOHFWURFKHPLVWU\RIVWHHORURWKHUPHWDOVLQFRQFUHWHLHLIDQGWRZKLFKH[WHQW RIWKHHOHFWURFKHPLVWU\RIVWHHORURWKHUPHWDOVLQFRQFUHWHLHLIDQGWRZKLFKH[WHQW
WKH3RXUEDL[GLDJUDPUHIOHFWVWKHFRPSOH[HOHFWURFKHPLVWU\DWWKHFRQFUHWHPHWDOLQ WKH3RXUEDL[GLDJUDPUHIOHFWVWKHFRPSOH[HOHFWURFKHPLVWU\DWWKHFRQFUHWHPHWDOLQ
WHUIDFH$VPHQWLRQHGLQ6HFWLRQWKH3RXUEDL[GLDJUDPIRUDQµ(O¶+2V\VWHP WHUIDFH$VPHQWLRQHGLQ6HFWLRQWKH3RXUEDL[GLDJUDPIRUDQµ(O¶+2V\VWHP
LV RQO\ YDOLG LQ WKH DEVHQFH RI VXEVWDQFHV ZKLFK FDQ IRUP VROXEOH FRPSOH[HV RU LQ LV RQO\ YDOLG LQ WKH DEVHQFH RI VXEVWDQFHV ZKLFK FDQ IRUP VROXEOH FRPSOH[HV RU LQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV

VROXEOH VDOWV ZLWK WKH LQYHVWLJDWHG HOHPHQW >3RXUEDL[ E@ :LWK UHJDUG WR WKH VROXEOH VDOWV ZLWK WKH LQYHVWLJDWHG HOHPHQW >3RXUEDL[ E@ :LWK UHJDUG WR WKH
FRPSOH[FKHPLVWU\RIWKHSRUHVROXWLRQDQGWKHVROLGSKDVHVRIWKHFRQFUHWHDVZHOODV FRPSOH[FKHPLVWU\RIWKHSRUHVROXWLRQDQGWKHVROLGSKDVHVRIWKHFRQFUHWHDVZHOODV
WKHGUDVWLFFKDQJHRIWKHFKHPLVWU\ZLWKFDUERQDWLRQDQGWKHLQJUHVVRIFKORULGHLRQV WKHGUDVWLFFKDQJHRIWKHFKHPLVWU\ZLWKFDUERQDWLRQDQGWKHLQJUHVVRIFKORULGHLRQV
FI 6HFWLRQ   WKLV SUREDEO\ LV WKH PRVW FULWLFDO OLPLWDWLRQ LQ WKH XVH RI 3RXUEDL[ FI 6HFWLRQ   WKLV SUREDEO\ LV WKH PRVW FULWLFDO OLPLWDWLRQ LQ WKH XVH RI 3RXUEDL[
GLDJUDPVIRUWKHGHVFULSWLRQRIUHLQIRUFHPHQWFRUURVLRQDQGWKHGHVLJQRIFRXQWHUPHD GLDJUDPVIRUWKHGHVFULSWLRQRIUHLQIRUFHPHQWFRUURVLRQDQGWKHGHVLJQRIFRXQWHUPHD
VXUHV%DVHGRQWKHSURSRVHGDSSOLFDWLRQRIWKH3RXUEDL[GLDJUDP FI6HFWLRQ  VXUHV%DVHGRQWKHSURSRVHGDSSOLFDWLRQRIWKH3RXUEDL[GLDJUDP FI6HFWLRQ 
ZH WKLQN WKDW LW LV SRVVLEOH WR HVWDEOLVK FXVWRPPDGH UHSUHVHQWDWLYH 3RXUEDL[ GLD ZH WKLQN WKDW LW LV SRVVLEOH WR HVWDEOLVK FXVWRPPDGH UHSUHVHQWDWLYH 3RXUEDL[ GLD
JUDPV IRU WKH FRQFUHWHVWHHO V\VWHP GHVSLWH WKH FRPSOH[ FKHPLVWU\ RI WKH FRQFUHWH JUDPV IRU WKH FRQFUHWHVWHHO V\VWHP GHVSLWH WKH FRPSOH[ FKHPLVWU\ RI WKH FRQFUHWH
HQYLURQPHQWDQGWKHYDULRXVVROXEOHDQGLQVROXEOHFRPSOH[HVWKDWFDQEHWKHUPRG\ HQYLURQPHQWDQGWKHYDULRXVVROXEOHDQGLQVROXEOHFRPSOH[HVWKDWFDQEHWKHUPRG\
QDPLFDOO\IDYRXUHGWREHIRUPHGLQFRPELQDWLRQZLWKWKHHPEHGGHGPHWDO:KLOHFHU QDPLFDOO\IDYRXUHGWREHIRUPHGLQFRPELQDWLRQZLWKWKHHPEHGGHGPHWDO:KLOHFHU
WDLQOLPLWDWLRQVDSSO\IRU³SXUH´PDJQHVLXPDQG]LQFLQFRQFUHWH FI&KDSWHU WKLV WDLQOLPLWDWLRQVDSSO\IRU³SXUH´PDJQHVLXPDQG]LQFLQFRQFUHWH FI&KDSWHU WKLV
KROGVLQSDUWLFXODUIRUFDUERQVWHHO KROGVLQSDUWLFXODUIRUFDUERQVWHHO
,QSULQFLSOHWKHFRQVLGHUDWLRQVLQWKLV6HFWLRQDUHOLPLWHGWRWKHHOHFWURFKHPLVWU\RI ,QSULQFLSOHWKHFRQVLGHUDWLRQVLQWKLV6HFWLRQDUHOLPLWHGWRWKHHOHFWURFKHPLVWU\RI
WKH PHWDO DQG WKH FKHPLVWU\ RI WKH HQYLURQPHQW LH WKH LQIOXHQFH RI WKH FRQFUHWH WKH PHWDO DQG WKH FKHPLVWU\ RI WKH HQYLURQPHQW LH WKH LQIOXHQFH RI WKH FRQFUHWH
FRPSRVLWLRQ RQ WKH 3RXUEDL[ GLDJUDPV IRU WKH LQYHVWLJDWHG PHWDO :H SUHVXPH WKDW FRPSRVLWLRQ RQ WKH 3RXUEDL[ GLDJUDPV IRU WKH LQYHVWLJDWHG PHWDO :H SUHVXPH WKDW
ZLWKUHJDUGWRWKHWKHUPRG\QDPLFVDOORWKHU HOHFWURFKHPLFDOIDFWRUVLQWKHFRQFUHWH ZLWKUHJDUGWRWKHWKHUPRG\QDPLFVDOORWKHU HOHFWURFKHPLFDOIDFWRUVLQWKHFRQFUHWH
HQYLURQPHQWDUHFRPSDUDEOHWRFRUURVLRQLQDTXHRXVHOHFWURO\WHVZKHUHDVWKHNLQHWLF HQYLURQPHQWDUHFRPSDUDEOHWRFRUURVLRQLQDTXHRXVHOHFWURO\WHVZKHUHDVWKHNLQHWLF
FRQGLWLRQVDUHHQWLUHO\GLIIHUHQW,QRWKHUZRUGVZHDVVXPHWKDWWKHFRQFUHWHEXONDQG FRQGLWLRQVDUHHQWLUHO\GLIIHUHQW,QRWKHUZRUGVZHDVVXPHWKDWWKHFRQFUHWHEXONDQG
WKHFRQFUHWHPHWDOLQWHUIDFHEHKDYHOLNHDFRPSOH[HOHFWURO\WHLQSDUWLFXODUZLWKUH WKHFRQFUHWHPHWDOLQWHUIDFHEHKDYHOLNHDFRPSOH[HOHFWURO\WHLQSDUWLFXODUZLWKUH
JDUGWRGLIIXVLRQRIFKHPLFDOVSHFLHV<HWIURPDWKHUPRG\QDPLFSRLQWRIYLHZZH JDUGWRGLIIXVLRQRIFKHPLFDOVSHFLHV<HWIURPDWKHUPRG\QDPLFSRLQWRIYLHZZH
FRQVLGHUWKHHPEHGGHGPHWDOWREHKDYHLQWKHVDPHZD\DVVXEPHUJHGLQDQHOHFWUR FRQVLGHUWKHHPEHGGHGPHWDOWREHKDYHLQWKHVDPHZD\DVVXEPHUJHGLQDQHOHFWUR
O\WH WKDW SURYLGHV WKH VDPH FRQGLWLRQV LH ZLWKUHJDUG WR WKH FRPSRVLWLRQ DHUDWLRQ O\WH WKDW SURYLGHV WKH VDPH FRQGLWLRQV LH ZLWKUHJDUG WR WKH FRPSRVLWLRQ DHUDWLRQ
HWF$PRQJRWKHUVWKLVLQFOXGHVWKDWWKHSDVVLYDWLRQEHKDYLRXURIDPHWDOHPEHGGHG HWF$PRQJRWKHUVWKLVLQFOXGHVWKDWWKHSDVVLYDWLRQEHKDYLRXURIDPHWDOHPEHGGHG
LQFRQFUHWHDQGWKHVWDELOLW\GRPDLQRIZDWHUDUHFRQVLGHUHGWREHUHIOHFWHGE\D3RXU LQFRQFUHWHDQGWKHVWDELOLW\GRPDLQRIZDWHUDUHFRQVLGHUHGWREHUHIOHFWHGE\D3RXU
EDL[GLDJUDPZKLFKGHVFULEHVWKHFRUUHVSRQGLQJDTXHRXVPHWDOOLFFRUURVLRQSURFHVV EDL[GLDJUDPZKLFKGHVFULEHVWKHFRUUHVSRQGLQJDTXHRXVPHWDOOLFFRUURVLRQSURFHVV
XQGHUWKHVDPHFRQGLWLRQ7KXVZHSRVWXODWHWKDWWKHLRQDFWLYLW\RIíPRO/DVD XQGHUWKHVDPHFRQGLWLRQ7KXVZHSRVWXODWHWKDWWKHLRQDFWLYLW\RIíPRO/DVD
FRQVHUYDWLYHYDOXHIRUSDVVLYDWLRQDQGWKHHIIHFWRILQFUHDVLQJWKHLRQDFWLYLW\DERYH FRQVHUYDWLYHYDOXHIRUSDVVLYDWLRQDQGWKHHIIHFWRILQFUHDVLQJWKHLRQDFWLYLW\DERYH
WKLV YDOXH DV GHVFULEHG LQ 6HFWLRQ  DUH DOVR YDOLG IRU DW OHDVW VWHHO DQG ]LQF LQ WKLV YDOXH DV GHVFULEHG LQ 6HFWLRQ  DUH DOVR YDOLG IRU DW OHDVW VWHHO DQG ]LQF LQ
FRQFUHWH FRQFUHWH
%DVHGRQWKHDERYHDVVXPSWLRQVZKLFKDUHIXUWKHUHODERUDWHGLQ&KDSWHUWKHLQIOX %DVHGRQWKHDERYHDVVXPSWLRQVZKLFKDUHIXUWKHUHODERUDWHGLQ&KDSWHUWKHLQIOX
HQFHRIWKHHOHFWURFKHPLVWU\RIWKHPHWDODQGWKHFKHPLVWU\RIWKHFRQFUHWH³HOHFWUR HQFHRIWKHHOHFWURFKHPLVWU\RIWKHPHWDODQGWKHFKHPLVWU\RIWKHFRQFUHWH³HOHFWUR
O\WH´DUHWKHRQO\SDUDPHWHUVZKLFKDUHOHIWWREHHYDOXDWHGIRUDYHULILFDWLRQRIWKH O\WH´DUHWKHRQO\SDUDPHWHUVZKLFKDUHOHIWWREHHYDOXDWHGIRUDYHULILFDWLRQRIWKH
DSSOLFDELOLW\ RI WKH 3RXUEDL[ IRU WKH GHVFULSWLRQ RI D FRQFUHWHPHWDO V\VWHP 7KLV DSSOLFDELOLW\ RI WKH 3RXUEDL[ IRU WKH GHVFULSWLRQ RI D FRQFUHWHPHWDO V\VWHP 7KLV
HYDOXDWLRQ EDVHG RQ WKH )H+2 V\VWHP LV VXPPDULVHG LQ 6HFWLRQV  DQG HYDOXDWLRQ EDVHG RQ WKH )H+2 V\VWHP LV VXPPDULVHG LQ 6HFWLRQV  DQG
6HOHFWHGQRWHVDUHPDGHZLWKUHJDUGWRWKHYDOLGLW\RIWKH3RXUEDL[GLDJUDP 6HOHFWHGQRWHVDUHPDGHZLWKUHJDUGWRWKHYDOLGLW\RIWKH3RXUEDL[GLDJUDP
IRU]LQFDQGPDJQHVLXPLQFRQFUHWHZKLOHDGHWDLOHGGLVFXVVLRQRQWKH]LQFFRQFUHWH IRU]LQFDQGPDJQHVLXPLQFRQFUHWHZKLOHDGHWDLOHGGLVFXVVLRQRQWKH]LQFFRQFUHWH
V\VWHPDQGWKHPDJQHVLXPFRQFUHWHV\VWHPLVSURYLGHGLQ6HFWLRQDQG6HFWLRQ V\VWHPDQGWKHPDJQHVLXPFRQFUHWHV\VWHPLVSURYLGHGLQ6HFWLRQDQG6HFWLRQ
UHVSHFWLYHO\ UHVSHFWLYHO\

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP

 )H+26\VWHPDQG(OHFWURFKHPLVWU\RI&DUERQ6WHHO  )H+26\VWHPDQG(OHFWURFKHPLVWU\RI&DUERQ6WHHO


'XHWRWKHIDFWWKDWVWHHOLVDOPRVWHQWLUHO\FRPSRVHGRILURQ FI6HFWLRQ ZHSUH 'XHWRWKHIDFWWKDWVWHHOLVDOPRVWHQWLUHO\FRPSRVHGRILURQ FI6HFWLRQ ZHSUH
VXPHWKDWLURQDGHTXDWHO\UHIOHFWVWKHHOHFWURFKHPLFDOSURSHUWLHVRIFDUERQVWHHOUHLQ VXPHWKDWLURQDGHTXDWHO\UHIOHFWVWKHHOHFWURFKHPLFDOSURSHUWLHVRIFDUERQVWHHOUHLQ
IRUFHPHQW0RUHRYHULURQKDVEHHQDQGLVVXFFHVVIXOO\XVHGWRGHVFULEHWKHHOHFWUR IRUFHPHQW0RUHRYHULURQKDVEHHQDQGLVVXFFHVVIXOO\XVHGWRGHVFULEHWKHHOHFWUR
FKHPLVWU\RIVWHHO7KXVZHDVVXPHWKDWWKH3RXUEDL[GLDJUDPRIWKH)H+2V\VWHP FKHPLVWU\RIVWHHO7KXVZHDVVXPHWKDWWKH3RXUEDL[GLDJUDPRIWKH)H+2V\VWHP
DSSOLHVIRUFDUERQVWHHOUHLQIRUFHPHQW DSSOLHVIRUFDUERQVWHHOUHLQIRUFHPHQW
7KHDERYHFRQVLGHUDWLRQVDUHQRWQHFHVVDU\IRUWKH=Q+2DQGWKH0J+2V\VWHP 7KHDERYHFRQVLGHUDWLRQVDUHQRWQHFHVVDU\IRUWKH=Q+2DQGWKH0J+2V\VWHP
DVDSSOLFDWLRQRI]LQFDQGPDJQHVLXPLQWKLVSURMHFWLVEDVHGRQWKHSXUHLHWKHXQDO DVDSSOLFDWLRQRI]LQFDQGPDJQHVLXPLQWKLVSURMHFWLVEDVHGRQWKHSXUHLHWKHXQDO
OR\HGPHWDO OR\HGPHWDO

 )H+26\VWHPDQG&KHPLVWU\LQ&RQFUHWH  )H+26\VWHPDQG&KHPLVWU\LQ&RQFUHWH


7KHLQIOXHQFHRIWKHFRPSOH[FRQFUHWHFKHPLVWU\RQWKHIRUPDWLRQRIVSHFLHVZKLFK 7KHLQIOXHQFHRIWKHFRPSOH[FRQFUHWHFKHPLVWU\RQWKHIRUPDWLRQRIVSHFLHVZKLFK
SRWHQWLDOO\LQWHUIHUHZLWKWKH)H+2V\VWHPLVWKHPRVWFULWLFDOFRQFHUQLQHVWDEOLVK SRWHQWLDOO\LQWHUIHUHZLWKWKH)H+2V\VWHPLVWKHPRVWFULWLFDOFRQFHUQLQHVWDEOLVK
LQJUHSUHVHQWDWLYH3RXUEDL[GLDJUDPV%HVLGHVFHUWDLQPLVFRQFHSWLRQVRIWKHWKHUPR LQJUHSUHVHQWDWLYH3RXUEDL[GLDJUDPV%HVLGHVFHUWDLQPLVFRQFHSWLRQVRIWKHWKHUPR
G\QDPLFVRIUHLQIRUFHPHQWFRUURVLRQZKLFKDUHGLVFXVVHGLQPRUHGHWDLOLQ&KDSWHU G\QDPLFVRIUHLQIRUFHPHQWFRUURVLRQZKLFKDUHGLVFXVVHGLQPRUHGHWDLOLQ&KDSWHU
WKLVFRQFHUQLVSUREDEO\WKHPDLQUHDVRQIRUWKHUHOXFWDQFHLQXVLQJWKH3RXUEDL[GLD WKLVFRQFHUQLVSUREDEO\WKHPDLQUHDVRQIRUWKHUHOXFWDQFHLQXVLQJWKH3RXUEDL[GLD
JUDP LQ WKH DUHD RI UHLQIRUFHPHQW FRUURVLRQ :H SRVWXODWH WKDW FRQVLGHUDWLRQV RQ JUDP LQ WKH DUHD RI UHLQIRUFHPHQW FRUURVLRQ :H SRVWXODWH WKDW FRQVLGHUDWLRQV RQ
µ0(3'V¶EDVHGRQWKHDSSURDFKGHVFULEHGLQ6HFWLRQLQFRPELQDWLRQZLWKH[ µ0(3'V¶EDVHGRQWKHDSSURDFKGHVFULEHGLQ6HFWLRQLQFRPELQDWLRQZLWKH[
SHULPHQWDO YHULILFDWLRQV DOORZ WKH DSSOLFDWLRQ RI 3RXUEDL[ GLDJUDPV LQ FRPSOH[ SHULPHQWDO YHULILFDWLRQV DOORZ WKH DSSOLFDWLRQ RI 3RXUEDL[ GLDJUDPV LQ FRPSOH[
FKHPLFDOV\VWHPVLQFOXGLQJWKHFRQFUHWHVWHHOV\VWHP FKHPLFDOV\VWHPVLQFOXGLQJWKHFRQFUHWHVWHHOV\VWHP
,Q WKH IROORZLQJ RXU PRVW LPSRUWDQW FRQVLGHUDWLRQV RQ WKLV WRSLF DUH JLYHQ ZLWK UH ,Q WKH IROORZLQJ RXU PRVW LPSRUWDQW FRQVLGHUDWLRQV RQ WKLV WRSLF DUH JLYHQ ZLWK UH
VSHFW WR XQFRQWDPLQDWHG FRQFUHWH FDUERQDWHG FRQFUHWH DQG FKORULGH FRQWDPLQDWHG VSHFW WR XQFRQWDPLQDWHG FRQFUHWH FDUERQDWHG FRQFUHWH DQG FKORULGH FRQWDPLQDWHG
FRQFUHWH FRQFUHWH
‡ 8QFRQWDPLQDWHGFRQFUHWH ‡ 8QFRQWDPLQDWHGFRQFUHWH
%DVHGRQWKHRUHWLFDOFRQVLGHUDWLRQVDQGYHULILFDWLRQVRQWKHHIIHFWRIIRUPDWLRQRI %DVHGRQWKHRUHWLFDOFRQVLGHUDWLRQVDQGYHULILFDWLRQVRQWKHHIIHFWRIIRUPDWLRQRI
SRVVLEOHFRPSRXQGVLQµ+6&¶ZHDVVXPHWKDWWKHHOHFWURFKHPLVWU\RIWKH)H+2 SRVVLEOHFRPSRXQGVLQµ+6&¶ZHDVVXPHWKDWWKHHOHFWURFKHPLVWU\RIWKH)H+2
V\VWHP LV IURP D WKHUPRG\QDPLF SRLQW RI YLHZ QRW VLJQLILFDQWO\ DIIHFWHG E\ WKH V\VWHP LV IURP D WKHUPRG\QDPLF SRLQW RI YLHZ QRW VLJQLILFDQWO\ DIIHFWHG E\ WKH
FKHPLFDOSURSHUWLHVRIWKHFRQFUHWHDSDUWIURPWKHK\GURJHQDQGK\GUR[\OLRQDF FKHPLFDOSURSHUWLHVRIWKHFRQFUHWHDSDUWIURPWKHK\GURJHQDQGK\GUR[\OLRQDF
WLYLW\LHWKHS+ZKLFKLVUHIOHFWHGE\WKH3RXUEDL[GLDJUDP7KHFRQFHQWUDWLRQV WLYLW\LHWKHS+ZKLFKLVUHIOHFWHGE\WKH3RXUEDL[GLDJUDP7KHFRQFHQWUDWLRQV
RI62íDQG&OíDUHFRQVLGHUHGWREHWRRORZWRDIIHFWWKH)H+2V\VWHPLQXQ RI62íDQG&OíDUHFRQVLGHUHGWREHWRRORZWRDIIHFWWKH)H+2V\VWHPLQXQ
FRQWDPLQDWHGFRQFUHWH FI6HFWLRQ 1DDQG.FDQIRUPYDULRXVWKHUPRG\ FRQWDPLQDWHGFRQFUHWH FI6HFWLRQ 1DDQG.FDQIRUPYDULRXVWKHUPRG\
QDPLFDOO\IDYRXUHGFRPSOH[HVZLWKLURQLQSDUWLFXODUVRGLXPDQGSRWDVVLXPIHU QDPLFDOO\IDYRXUHGFRPSOH[HVZLWKLURQLQSDUWLFXODUVRGLXPDQGSRWDVVLXPIHU
ULWHV<HWEDVHGRQWKHSURSRVHGDSSURDFKRISRVLWLYHDQGQHJDWLYHLQGLFDWRUVIRU ULWHV<HWEDVHGRQWKHSURSRVHGDSSURDFKRISRVLWLYHDQGQHJDWLYHLQGLFDWRUVIRU
WKH SUHVHOHFWLRQ RI WKH VSHFLHV ZH IRXQG WKDW WKH WHPSHUDWXUH RI IRUPDWLRQ IRU WKH SUHVHOHFWLRQ RI WKH VSHFLHV ZH IRXQG WKDW WKH WHPSHUDWXUH RI IRUPDWLRQ IRU
WKHVH FRPSOH[HV LV IDU EH\RQG WKH WHPSHUDWXUH FRQGLWLRQV LQ WKH FRQFUHWH VWUXF WKHVH FRPSOH[HV LV IDU EH\RQG WKH WHPSHUDWXUH FRQGLWLRQV LQ WKH FRQFUHWH VWUXF
WXUHV%HVLGHVWKHDEVHQFHRILQIRUPDWLRQRQIRUPDWLRQXQGHUQDWXUDOFRQGLWLRQV WXUHV%HVLGHVWKHDEVHQFHRI LQIRUPDWLRQRQIRUPDWLRQXQGHUQDWXUDOFRQGLWLRQV
SURFHVVHVGHVFULEHGIRUWKHSURGXFWLRQRIWKHVHFRPSOH[HVUHODWHWRKLJKWHPSHUD SURFHVVHVGHVFULEHGIRUWKHSURGXFWLRQRIWKHVHFRPSOH[HVUHODWHWRKLJKWHPSHUD
WXUH DQG SODVPD WHFKQLTXHV HJ >5DQGKDZD  6ZHHW\  6RILQ  -DQVHQ WXUH DQG SODVPD WHFKQLTXHV HJ >5DQGKDZD  6ZHHW\  6RILQ  -DQVHQ
 5RXVVHDX  %HUQKHLP @  ZKLFK DUH UHJDUGHG DV QHJDWLYH LQGLFDWRUV  5RXVVHDX  %HUQKHLP @  ZKLFK DUH UHJDUGHG DV QHJDWLYH LQGLFDWRUV
+HQFHDOOFRPSOH[HVEHWZHHQLURQDQGVRGLXPRUSRWDVVLXPDUHFRQVLGHUHGWREH +HQFHDOOFRPSOH[HVEHWZHHQLURQDQGVRGLXPRUSRWDVVLXPDUHFRQVLGHUHGWREH

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV

LQVLJQLILFDQWIRUWKHHVWDEOLVKPHQWRIWKH3RXUEDL[GLDJUDPIRUVWHHOLQXQFRQWDPL LQVLJQLILFDQWIRUWKHHVWDEOLVKPHQWRIWKH3RXUEDL[GLDJUDPIRUVWHHOLQXQFRQWDPL
QDWHGFRQFUHWH&DOFLXPLVSUHVHQWLQFRQFUHWHLQYDULRXVFRPSOH[HVEHIRUHDQGDI QDWHGFRQFUHWH&DOFLXPLVSUHVHQWLQFRQFUHWHLQYDULRXVFRPSOH[HVEHIRUHDQGDI
WHU K\GUDWLRQ FI 6HFWLRQ   7KH KLJK UHDFWLRQ DIILQLW\ RI FDOFLXP LV GHPRQ WHU K\GUDWLRQ FI 6HFWLRQ   7KH KLJK UHDFWLRQ DIILQLW\ RI FDOFLXP LV GHPRQ
VWUDWHGE\HJFDUERQDWLRQ FI6HFWLRQ &DOFLXPFDUERQDWH &D&2 ZDV VWUDWHGE\HJFDUERQDWLRQ FI6HFWLRQ &DOFLXPFDUERQDWH &D&2 ZDV
DOVR REVHUYHG DV D FRQVWLWXHQW RI WKH SDVVLYH OD\HU HJ >3RXUVDHH  +DQVVRQ DOVR REVHUYHG DV D FRQVWLWXHQW RI WKH SDVVLYH OD\HU HJ >3RXUVDHH  +DQVVRQ
@ +RZHYHUZHGRQRWWKLQNWKDW&D&2KDVDPDMRUHIIHFWRQWKH SDVVLYH @  +RZHYHU ZH GR QRW WKLQN WKDW &D&2KDVDPDMRUHIIHFWRQWKH SDVVLYH
GRPDLQVRIVWHHOLQFRQFUHWH$VKRUWQRWHRQWKHHIIHFWRIFDOFLWHRQWKHSDVVLYD GRPDLQVRIVWHHOLQFRQFUHWH$VKRUWQRWHRQWKHHIIHFWRIFDOFLWHRQWKHSDVVLYD
WLRQLVJLYHQLQ6HFWLRQ WLRQLVJLYHQLQ6HFWLRQ
‡ &DUERQDWHGFRQFUHWH ‡ &DUERQDWHGFRQFUHWH
:HDVVXPHWKDWEHVLGHVWKHUHGXFWLRQLQDONDOLQLW\WKHHIIHFWRIFDUERQDWLRQFDQEH :HDVVXPHWKDWEHVLGHVWKHUHGXFWLRQLQDONDOLQLW\WKHHIIHFWRIFDUERQDWLRQFDQEH
FRQVLGHUHGE\LQWURGXFLQJFDUERQWRWKH)H+2µ6(3'¶%DVHGRQHYDOXDWLRQVRI FRQVLGHUHGE\LQWURGXFLQJFDUERQWRWKH)H+2µ6(3'¶%DVHGRQHYDOXDWLRQVRI
WKH WKHUPRG\QDPLFDOO\ IDYRXUHG VSHFLHV LQ WKH )H&+2 V\VWHP ZH IRXQG WKDW WKH WKHUPRG\QDPLFDOO\ IDYRXUHG VSHFLHV LQ WKH )H&+2 V\VWHP ZH IRXQG WKDW
LURQFDUERQDWH )H&2 DOVRNQRZQDVVLGHULWHLVWKHRQO\SRWHQWLDOO\IRUPHGVSH LURQFDUERQDWH )H&2 DOVRNQRZQDVVLGHULWHLVWKHRQO\SRWHQWLDOO\IRUPHGVSH
FLHV)H&2KDVDFRQVLGHUDEOHHIIHFWRQWKHSDVVLYDWLRQDUHDLQWKHµ0(3'¶RIWKH FLHV)H&2KDVDFRQVLGHUDEOHHIIHFWRQWKHSDVVLYDWLRQDUHDLQWKHµ0(3'¶RIWKH
)H&+2V\VWHP+RZHYHUEDVHGRQDFRPSDULVRQRIWKHµ¨*I¶YDOXHVIRUWKH )H&+2V\VWHP+RZHYHUEDVHGRQDFRPSDULVRQRIWKHµ¨*I¶YDOXHV IRU WKH
HYDOXDWLRQ RI WKH PXWXDO IRUPDWLRQ )H2 µ¨*I¶  í N-PRO  LV WKHUPRG\ HYDOXDWLRQ RI WKH PXWXDO IRUPDWLRQ )H2 µ¨*I¶  í N-PRO  LV WKHUPRG\
QDPLFDOO\IDYRXUHGRYHU)H&2 µ¨*I¶ íN-PRO 7KLVQRWLRQLVFRQILUPHG QDPLFDOO\IDYRXUHGRYHU)H&2 µ¨*I¶ íN-PRO 7KLVQRWLRQLVFRQILUPHG
E\ QDWXUH VLQFH VLGHULWH DV D QDWXUDO PLQHUDO JHQHUDOO\ H[SHULHQFHV D VXUIDFH DO E\ QDWXUH VLQFH VLGHULWH DV D QDWXUDO PLQHUDO JHQHUDOO\ H[SHULHQFHV D VXUIDFH DO
WHUDWLRQ WR DQ LURQ R[LGH >0LQ*DO @ +HQFH ZH DVVXPH WKDW )H&2 FDQ EH WHUDWLRQ WR DQ LURQ R[LGH >0LQ*DO @ +HQFH ZH DVVXPH WKDW )H&2 FDQ EH
RPLWWHGIURPWKH3RXUEDL[GLDJUDPIRUFDUERQDWHGFRQFUHWHDQGWKXVVWHHOLQFDU RPLWWHGIURPWKH3RXUEDL[GLDJUDPIRUFDUERQDWHGFRQFUHWHDQGWKXVVWHHOLQFDU
ERQDWHGFRQFUHWHFDQEHWUHDWHGLQWKHVDPHZD\DVVWHHOLQXQFRQWDPLQDWHGFRQ ERQDWHGFRQFUHWHFDQEHWUHDWHGLQWKHVDPHZD\DVVWHHOLQXQFRQWDPLQDWHGFRQ
FUHWH FUHWH
‡ &KORULGHFRQWDPLQDWHGFRQFUHWH ‡ &KORULGHFRQWDPLQDWHGFRQFUHWH
7KHSRWHQWLDOO\IRUPHGFRPSOH[HVEHWZHHQVWHHODQGXQFRQWDPLQDWHGDQGFDUERQ 7KHSRWHQWLDOO\IRUPHGFRPSOH[HVEHWZHHQVWHHODQG XQFRQWDPLQDWHGDQGFDUERQ
DWHG FRQFUHWH DUH OLPLWHG WR LQVROXEOH VDOWV ZKLFK FDQ EH IRUPHG LQ WKH FRUUH DWHG FRQFUHWH DUH OLPLWHG WR LQVROXEOH VDOWV ZKLFK FDQ EH IRUPHG LQ WKH FRUUH
VSRQGLQJSDVVLYLW\GRPDLQRIWKH)H+2V\VWHPRUH[WHQGWKLVGRPDLQLISUHVH VSRQGLQJSDVVLYLW\GRPDLQRIWKH)H+2V\VWHPRUH[WHQGWKLVGRPDLQLISUHVH
OHFWHGIRUIRUPDWLRQLQDQµ0(3'¶7KXVZHWKLQNWKDWLWWREHRQWKHVDIHVLGHWR OHFWHGIRUIRUPDWLRQLQDQµ0(3'¶7KXVZHWKLQNWKDWLWWREHRQWKHVDIHVLGHWR
H[FOXGHVXFKVSHFLHVIURPWKH3RXUEDL[GLDJUDP+RZHYHUWKHVLWXDWLRQZLWKDGG H[FOXGHVXFKVSHFLHVIURPWKH3RXUEDL[GLDJUDP+RZHYHUWKHVLWXDWLRQZLWKDGG
LQJFKORULGHWRWKH)H+2V\VWHPLVHQWLUHO\GLIIHUHQW7KHWKHUPRG\QDPLFHIIHFW LQJFKORULGHWRWKH)H+2V\VWHPLVHQWLUHO\GLIIHUHQW7KHWKHUPRG\QDPLFHIIHFW
RIFKORULGHDGGLWLRQLVLQWKHµ0(3'¶RIWKH)H&O+2V\VWHPUHIOHFWHGE\IRU RIFKORULGH DGGLWLRQLVLQWKHµ0(3'¶RIWKH)H&O+2V\VWHPUHIOHFWHGE\IRU
PDWLRQRIVROXEOHFRPSOH[HVRIIHUULFFKORULGH )H&O DQGZLWKKLJKHUFKORULGH PDWLRQRIVROXEOHFRPSOH[HVRIIHUULFFKORULGH )H&O DQGZLWKKLJKHUFKORULGH
FRQFHQWUDWLRQIHUURXVFKORULGH )H&O 7KHVWDELOLW\GRPDLQVRIWKHVHFRPSOH[HV FRQFHQWUDWLRQIHUURXVFKORULGH )H&O 7KHVWDELOLW\GRPDLQVRIWKHVHFRPSOH[HV
DUHQRWOLPLWHGWRWKHFRUUHVSRQGLQJRQHVRIIHUURXVLRQDQGIHUULFLRQLQWKH)H DUHQRWOLPLWHGWRWKHFRUUHVSRQGLQJRQHVRIIHUURXVLRQDQGIHUULFLRQLQWKH)H
+2 V\VWHP EXW GHSHQGLQJ RQ WKH FKORULGH FRQFHQWUDWLRQ WKH\ H[WHQG LQWR WKH +2 V\VWHP EXW GHSHQGLQJ RQ WKH FKORULGH FRQFHQWUDWLRQ WKH\ H[WHQG LQWR WKH
FRUUHVSRQGLQJSDVVLYHGRPDLQVRIWKH)H+2V\VWHP+RZHYHUWKHUPRG\QDPLF FRUUHVSRQGLQJSDVVLYHGRPDLQVRIWKH)H+2V\VWHP+RZHYHUWKHUPRG\QDPLF
FRQVLGHUDWLRQVDORQHDUHQRWVXIILFLHQWLQGHVFULELQJFKORULGHLQGXFHGFRUURVLRQ FRQVLGHUDWLRQVDORQHDUHQRWVXIILFLHQWLQGHVFULELQJFKORULGHLQGXFHGFRUURVLRQ
7KH ORFDOLVHG EUHDNGRZQ RI WKH SDVVLYH OD\HU XQGHU FKORULGH LQLWLDWHG FRUURVLRQ 7KH ORFDOLVHG EUHDNGRZQ RI WKH SDVVLYH OD\HU XQGHU FKORULGH LQLWLDWHG FRUURVLRQ
DQGWKHUHVXOWLQJRIIRUPDWLRQRIFRUURVLRQSLWVLVDNLQHWLFDVSHFWWKDWLVJHQHUDOO\ DQGWKHUHVXOWLQJRIIRUPDWLRQRIFRUURVLRQSLWVLVDNLQHWLFDVSHFWWKDWLVJHQHUDOO\
DSSURDFKHG E\ WKH SLWWLQJ SRWHQWLDO µ(SLW¶ FI 6HFWLRQ   ZKLFK LV IXUWKHU DSSURDFKHG E\ WKH SLWWLQJ SRWHQWLDO µ(SLW¶ FI 6HFWLRQ   ZKLFK LV IXUWKHU
HODERUDWHG LQ 6HFWLRQ  1HYHUWKHOHVV ZH WKLQN WKDW )H&O+2 µ0(3'V¶ HODERUDWHG LQ 6HFWLRQ  1HYHUWKHOHVV ZH WKLQN WKDW )H&O+2 µ0(3'V¶

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP $SSOLFDWLRQRI7KHUPRG\QDPLFV 3RXUEDL['LDJUDP

FDQEH DGYDQWDJHRXVO\ DSSOLHGWRGHVFULEH DQGXQGHUVWDQGFRUURVLRQSURSDJDWLRQ FDQEH DGYDQWDJHRXVO\ DSSOLHGWRGHVFULEH DQGXQGHUVWDQGFRUURVLRQSURSDJDWLRQ


RIFKORULGHLQGXFHGFRUURVLRQDVH[HPSOLILHGLQ6HFWLRQ RIFKORULGHLQGXFHGFRUURVLRQDVH[HPSOLILHGLQ6HFWLRQ
,QFRQFOXVLRQZHWKLQNWKDWWKHµ6(3'¶RIWKH)H+2V\VWHPVXIILFLHQWO\UHIOHFWVWKH ,QFRQFOXVLRQZHWKLQNWKDWWKHµ6(3'¶RIWKH)H+2V\VWHPVXIILFLHQWO\UHIOHFWVWKH
FKHPLFDOSURSHUWLHVRIVWHHOLQXQFRQWDPLQDWHGDQGFDUERQDWHGFRQFUHWHEXWFKORULGH FKHPLFDOSURSHUWLHVRIVWHHOLQXQFRQWDPLQDWHGDQGFDUERQDWHGFRQFUHWHEXWFKORULGH
FRQWDPLQDWHG FRQFUHWH UHTXLUHV VSHFLDO FRQVLGHUDWLRQV 7KH )H&O+2 µ0(3'¶ DO FRQWDPLQDWHG FRQFUHWH UHTXLUHV VSHFLDO FRQVLGHUDWLRQV 7KH )H&O+2 µ0(3'¶ DO
ORZV FRPSUHKHQVLYH DQG LQVLJKWIXO FRQVLGHUDWLRQV RQ WKH FRUURVLRQ SURSDJDWLRQ ORZV FRPSUHKHQVLYH DQG LQVLJKWIXO FRQVLGHUDWLRQV RQ WKH FRUURVLRQ SURSDJDWLRQ
+RZHYHULWVKRXOGEHHPSKDVLVHGWKDWFRUURVLRQLQLWLDWLRQE\FKORULGHLRQVFDQQRWEH +RZHYHULWVKRXOGEHHPSKDVLVHGWKDWFRUURVLRQLQLWLDWLRQE\FKORULGHLRQVFDQQRWEH
UHIOHFWHGE\WKHUPRG\QDPLFSULQFLSOHVDORQH UHIOHFWHGE\WKHUPRG\QDPLFSULQFLSOHVDORQH
&RQFHUQLQJ]LQFDQGPDJQHVLXPWKHVDPHDSSOLHVZLWKUHJDUGWR1DDQG.DVGH &RQFHUQLQJ]LQFDQGPDJQHVLXPWKHVDPHDSSOLHVZLWKUHJDUGWR1DDQG.DVGH
VFULEHGIRULURQLQXQFRQWDPLQDWHGFRQFUHWH:HVXJJHVWWKDWQHLWKHURIWKHWZRPHWDOV VFULEHGIRULURQLQXQFRQWDPLQDWHGFRQFUHWH:HVXJJHVWWKDWQHLWKHURIWKHWZRPHWDOV
IRUPFRPSOH[HVZLWKVRGLXPDQGSRWDVVLXPZKLFKQHHGWREHWDNHQLQWRDFFRXQWLQ IRUPFRPSOH[HVZLWKVRGLXPDQGSRWDVVLXPZKLFKQHHGWREHWDNHQLQWRDFFRXQWLQ
WKH3RXUEDL[GLDJUDP+RZHYHUWKHSUHVHQFHRIFDOFLXPSOD\VDPDMRUUROHIRUERWK WKH3RXUEDL[GLDJUDP+RZHYHUWKHSUHVHQFHRIFDOFLXPSOD\VDPDMRUUROHIRUERWK
IRU]LQFDQGPDJQHVLXP$QLPSRUWDQWFRPSOH[WREHWDNHQLQWRDFFRXQWIRU]LQFLQ IRU]LQFDQGPDJQHVLXP$QLPSRUWDQWFRPSOH[WREHWDNHQLQWRDFFRXQW IRU]LQFLQ
FRQFUHWH LV FDOFLXP K\GUR[\]LQFDWH HJ >ILE D )UDWHVL D %HUWROLQL HWDO FRQFUHWH LV FDOFLXP K\GUR[\]LQFDWH HJ >ILE D )UDWHVL D %HUWROLQL HWDO
<HRPDQV@:HFRQVLGHUFDOFLXPK\GUR[\]LQFDWHWRFRQWULEXWHWRWKHSDV <HRPDQV@:HFRQVLGHUFDOFLXPK\GUR[\]LQFDWHWRFRQWULEXWHWRWKHSDV
VLYLW\GRPDLQRI]LQFLQFRQFUHWHEXWQRWWRLQWHUIHUHZLWKLWVHOHFWURFKHPLVWU\RWKHU VLYLW\GRPDLQRI]LQFLQFRQFUHWHEXWQRWWRLQWHUIHUHZLWKLWVHOHFWURFKHPLVWU\RWKHU
ZLVH<HWEDVHGRQWKHRUHWLFDOFRQVLGHUDWLRQVDQGRZQH[SHULPHQWDOREVHUYDWLRQVZH ZLVH<HWEDVHGRQWKHRUHWLFDOFRQVLGHUDWLRQVDQGRZQH[SHULPHQWDOREVHUYDWLRQVZH
REVHUYHGWKDWFDOFLXPKDVDQHYHQPRUHSURQRXQFHGHIIHFWRQWKHHOHFWURFKHPLVWU\RI REVHUYHGWKDWFDOFLXPKDVDQHYHQPRUHSURQRXQFHGHIIHFWRQWKHHOHFWURFKHPLVWU\RI
PDJQHVLXP EHFDXVH IRUPDWLRQ RI FDOFLWH SUHYHQWV WKH SDVVLYDWLRQ RI PDJQHVLXP LQ PDJQHVLXP EHFDXVH IRUPDWLRQ RI FDOFLWH SUHYHQWV WKH SDVVLYDWLRQ RI PDJQHVLXP LQ
WKH FRQFUHWH HQYLURQPHQW +HQFH PDJQHVLXP UHTXLUHV VSHFLDO FRQVLGHUDWLRQV :LWK WKH FRQFUHWH HQYLURQPHQW +HQFH PDJQHVLXP UHTXLUHV VSHFLDO FRQVLGHUDWLRQV :LWK
UHJDUGWRFDUERQDWLRQZHFRQVLGHUWKDWHJWKHIRUPDWLRQRI]LQFFDUERQDWH =Q&2  UHJDUGWRFDUERQDWLRQZHFRQVLGHUWKDWHJWKHIRUPDWLRQRI]LQFFDUERQDWH =Q&2 
FRQWULEXWHV WR WKH UHVLVWDQFH RI JDOYDQLVHG VWHHO LQ FDUERQDWHG FRQFUHWH 3UHVHQFH RI FRQWULEXWHV WR WKH UHVLVWDQFH RI JDOYDQLVHG VWHHO LQ FDUERQDWHG FRQFUHWH 3UHVHQFH RI
FKORULGHVUHTXLUHVVSHFLDOFRQVLGHUDWLRQVIRUERWK]LQFDQGPDJQHVLXP7KHSDUDPH FKORULGHVUHTXLUHVVSHFLDOFRQVLGHUDWLRQV IRUERWK ]LQF DQGPDJQHVLXP 7KHSDUDPH
WHUVLQIOXHQFLQJWKHHOHFWURFKHPLVWU\RI]LQFDQGPDJQHVLXPLQWKHFRQFUHWHHQYLURQ WHUVLQIOXHQFLQJWKHHOHFWURFKHPLVWU\RI]LQFDQGPDJQHVLXPLQWKHFRQFUHWHHQYLURQ
PHQWDQGWKHDVVRFLDWHG 3RXUEDL[GLDJUDPDUH JLYHQLQ&KDSWHUZKLFKGHDOVZLWK PHQWDQGWKHDVVRFLDWHG 3RXUEDL[GLDJUDPDUH JLYHQLQ&KDSWHUZKLFKGHDOVZLWK
WKHDSSOLFDWLRQRIWKHVHPHWDOVIRUWKHSURSRVHGQHZFRXQWHUPHDVXUHV WKHDSSOLFDWLRQRIWKHVHPHWDOVIRUWKHSURSRVHGQHZFRXQWHUPHDVXUHV
 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 

 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW  7KHUPRG\QDPLFVRI5HLQIRUFHPHQW
&RUURVLRQ &RUURVLRQ
,Q6HFWLRQWKHQHFHVVDU\DQDO\WLFDOWRROVWRGHVFULEHDTXHRXVPHWDOOLFFRUURVLRQRQ ,Q6HFWLRQWKHQHFHVVDU\DQDO\WLFDOWRROVWRGHVFULEHDTXHRXVPHWDOOLFFRUURVLRQRQ
DWKHUPRG\QDPLFEDVLVZHUHLQWURGXFHGDQGRXUXVHRIWKHVHWRROVDQGWKHLUDSSOLFD DWKHUPRG\QDPLFEDVLVZHUHLQWURGXFHGDQGRXUXVHRIWKHVHWRROVDQGWKHLUDSSOLFD
ELOLW\ZHUHGLVFXVVHGLQ&KDSWHU,QWKLV&KDSWHUWKHWKHRU\LVDSSOLHGLQFRPELQD ELOLW\ZHUHGLVFXVVHGLQ&KDSWHU,QWKLV&KDSWHUWKHWKHRU\LVDSSOLHGLQFRPELQD
WLRQ ZLWK WKH LQIRUPDWLRQ RQ WKH FRPSOH[ SK\VLFDO FKHPLFDO DQG HOHFWURFKHPLFDO WLRQ ZLWK WKH LQIRUPDWLRQ RQ WKH FRPSOH[ SK\VLFDO FKHPLFDO DQG HOHFWURFKHPLFDO
SURSHUWLHVRIWKHFRQFUHWHVWHHOV\VWHPZKLFKKDVEHHQVXPPDULVHGLQ&KDSWHUWR SURSHUWLHVRIWKHFRQFUHWHVWHHOV\VWHPZKLFKKDVEHHQVXPPDULVHGLQ&KDSWHUWR
GHVFULEHWKHHOHFWURFKHPLVWU\RIVWHHOLQFRQFUHWHRQDWKHUPRG\QDPLFEDVLV GHVFULEHWKHHOHFWURFKHPLVWU\RIVWHHOLQFRQFUHWHRQDWKHUPRG\QDPLFEDVLV
,WVKRXOGEHHPSKDVLVHGKHUHWKDWZHGLVUHJDUGE\QRPHDQVWKHLPSRUWDQFHRINLQHW ,WVKRXOGEHHPSKDVLVHGKHUHWKDWZHGLVUHJDUGE\QRPHDQVWKHLPSRUWDQFHRINLQHW
LFV LQ FRUURVLRQ SURFHVVHV LQ JHQHUDO DQG LQ SDUWLFXODU IRU FRUURVLRQ RI VWHHO LQ FRQ LFV LQ FRUURVLRQ SURFHVVHV LQ JHQHUDO DQG LQ SDUWLFXODU IRU FRUURVLRQ RI VWHHO LQ FRQ
FUHWH 4XLWH RQ WKH FRQWUDU\ ZHUHJDUGNLQHWLFFRQVLGHUDWLRQV FI6HFWLRQ   WREH FUHWH 4XLWH RQ WKH FRQWUDU\ ZHUHJDUGNLQHWLFFRQVLGHUDWLRQV FI6HFWLRQ   WREH
HVVHQWLDODQGHPSKDVLVHWKDWFRQFOXVLRQVEDVHGRQWKHUPRG\QDPLFFRQVLGHUDWLRQVDUH HVVHQWLDODQGHPSKDVLVHWKDWFRQFOXVLRQVEDVHGRQWKHUPRG\QDPLFFRQVLGHUDWLRQVDUH
SRLQWOHVVZLWKRXWWDNLQJUHDFWLRQNLQHWLFVLQWRGXHDFFRXQW.LQHWLFFRQVLGHUDWLRQVGR SRLQWOHVVZLWKRXWWDNLQJUHDFWLRQNLQHWLFVLQWRGXHDFFRXQW.LQHWLFFRQVLGHUDWLRQVGR
QRWRQO\H[KLELWWKHOLPLWDWLRQVRIWKHUPRG\QDPLFPRGHOVEXWWKH\FDQDOVREHEHQH QRWRQO\H[KLELWWKHOLPLWDWLRQVRIWKHUPRG\QDPLFPRGHOVEXWWKH\FDQDOVREHEHQH
ILFLDOO\DSSOLHGWRGHVFULEHFRUURVLRQSURFHVVHVRIVWHHOLQFRQFUHWH(VSHFLDOO\SRODUL ILFLDOO\DSSOLHGWRGHVFULEHFRUURVLRQSURFHVVHVRIVWHHOLQFRQFUHWH(VSHFLDOO\SRODUL
VDWLRQFXUYHVFDQEHXVHGLQDQLQVLJKWIXOPDQQHUIRUWKDWSXUSRVHDVLWKDVEHHQGRQH VDWLRQFXUYHVFDQEHXVHGLQDQLQVLJKWIXOPDQQHUIRUWKDWSXUSRVHDVLWKDVEHHQGRQH
LQHJ>%HUWROLQLHWDO@ LQHJ>%HUWROLQLHWDO@
+RZHYHU DV PHQWLRQHG LQ &KDSWHU  ZH WKLQN WKDW WKHUPRG\QDPLF FRQVLGHUDWLRQV +RZHYHU DV PHQWLRQHG LQ &KDSWHU  ZH WKLQN WKDW WKHUPRG\QDPLF FRQVLGHUDWLRQV
SURYLGHDORWRISRWHQWLDOIRUWKHGHWDLOHGXQGHUVWDQGLQJRIFRUURVLRQPHFKDQLVPVDQG SURYLGHDORWRISRWHQWLDOIRUWKHGHWDLOHGXQGHUVWDQGLQJRIFRUURVLRQPHFKDQLVPVDQG
DVRSSRVHGWRNLQHWLFFRQVLGHUDWLRQVDOORZSUHGLFWLRQVIRUWKHV\VWHPEDVHGRQWKHRU\ DVRSSRVHGWRNLQHWLFFRQVLGHUDWLRQVDOORZSUHGLFWLRQVIRUWKHV\VWHPEDVHGRQWKHRU\
7KHUHDVRQIRUWKHDSSDUHQWO\OLPLWHGXVHRIWKH3RXUEDL[GLDJUDPLQWKLVDUHDVHHPV 7KHUHDVRQIRUWKHDSSDUHQWO\OLPLWHGXVHRIWKH3RXUEDL[GLDJUDPLQWKLVDUHDVHHPV
WR EH GXH WR WKH LQWULFDWH DVVXPSWLRQV ZKLFK DUH QHFHVVDU\ WR REWDLQ UHSUHVHQWDWLYH WR EH GXH WR WKH LQWULFDWH DVVXPSWLRQV ZKLFK DUH QHFHVVDU\ WR REWDLQ UHSUHVHQWDWLYH
UHVXOWV FI6HFWLRQ RUEDVHGRQPLVFRQFHSWLRQVZLWKUHJDUGWRLWVDSSOLFDELOLW\ UHVXOWV FI6HFWLRQ RUEDVHGRQPLVFRQFHSWLRQVZLWKUHJDUGWRLWVDSSOLFDELOLW\
FI6HFWLRQ  FI6HFWLRQ 
,QFRQWUDVWWRWKHUDWKHUOLPLWHGDSSOLFDWLRQRI3RXUEDL[GLDJUDPVLQWKHDUHDRIUHLQ ,QFRQWUDVWWRWKHUDWKHUOLPLWHGDSSOLFDWLRQRI3RXUEDL[GLDJUDPVLQWKHDUHDRIUHLQ
IRUFHPHQW FRUURVLRQ UHDFWLRQ PHFKDQLVPV KDYH EHHQ SRVWXODWHG LQ WKH OLWHUDWXUH IRU IRUFHPHQW FRUURVLRQ UHDFWLRQ PHFKDQLVPV KDYH EHHQ SRVWXODWHG LQ WKH OLWHUDWXUH IRU
WKHGHVFULSWLRQRIFRUURVLRQSURFHVVHVRIVWHHOLQFRQFUHWH ,QVWDQGDUGWH[WERRNVWKH WKHGHVFULSWLRQRIFRUURVLRQSURFHVVHVRIVWHHOLQFRQFUHWH ,QVWDQGDUGWH[WERRNVWKH
SURYLVLRQ RI UHDFWLRQ PHFKDQLVPV LV RIWHQ OLPLWHG WR WKH IXQGDPHQWDO FRUURVLRQ SURYLVLRQ RI UHDFWLRQ PHFKDQLVPV LV RIWHQ OLPLWHG WR WKH IXQGDPHQWDO FRUURVLRQ
PHFKDQLVP IRU VWHHO LQ FRQFUHWH ZKLFK LV IXUWKHU HODERUDWHG LQ 6HFWLRQ  +RZ PHFKDQLVP IRU VWHHO LQ FRQFUHWH ZKLFK LV IXUWKHU HODERUDWHG LQ 6HFWLRQ  +RZ
HYHUWKHUHDUHYDULRXVRWKHUSRVVLEOHPHFKDQLVPVIRUWKHGLIIHUHQWFRUURVLRQVWDWHVRI HYHUWKHUHDUHYDULRXVRWKHUSRVVLEOHPHFKDQLVPVIRUWKHGLIIHUHQWFRUURVLRQVWDWHVRI
VWHHOLQFRQFUHWH6RPHRIWKHVHPHFKDQLVPVKDYHEHHQSRVWXODWHGLQRWKHUOLWHUDWXUH VWHHOLQFRQFUHWH6RPHRIWKHVHPHFKDQLVPVKDYHEHHQSRVWXODWHGLQRWKHUOLWHUDWXUH
HJ LQ VFLHQWLILFSDSHUV RU WKHVHV<HW DVLVGLVFXVVHGLQPRUHGHWDLOLQ 6HFWLRQ HJ LQ VFLHQWLILFSDSHUV RU WKHVHV<HW DVLVGLVFXVVHGLQPRUHGHWDLOLQ 6HFWLRQ
PDQ\RIWKHSRVWXODWHGPHFKDQLVPVVHHPWRH[KLELWWKHUPRG\QDPLFLQFRQVLVWHQFLHV PDQ\RIWKHSRVWXODWHGPHFKDQLVPVVHHPWRH[KLELWWKHUPRG\QDPLFLQFRQVLVWHQFLHV
7KHUPRG\QDPLFVFRQWUROWKHXQGHUO\LQJSULQFLSOHVLQFRUURVLRQSURFHVVHVDQGKHQFH 7KHUPRG\QDPLFVFRQWUROWKHXQGHUO\LQJSULQFLSOHVLQFRUURVLRQSURFHVVHVDQGKHQFH
DUHDFWLRQGRHVQRWRFFXULIWKHUPRG\QDPLFDOO\LPSRVVLEOH&RQVLGHUDWLRQVEDVHGRQ DUHDFWLRQGRHVQRWRFFXULIWKHUPRG\QDPLFDOO\LPSRVVLEOH&RQVLGHUDWLRQVEDVHGRQ
WKH3RXUEDL[GLDJUDPDQGRQUHDFWLRQPHFKDQLVPVDOORZWRGHWHUPLQHZKLFKUHDFWLRQV WKH3RXUEDL[GLDJUDPDQGRQUHDFWLRQPHFKDQLVPVDOORZWRGHWHUPLQHZKLFKUHDFWLRQV
DUHWKHUPRG\QDPLFDOO\SRVVLEOHRULPSRVVLEOHLQDFHUWDLQV\VWHPJLYHQWKDWWKH\UH DUHWKHUPRG\QDPLFDOO\SRVVLEOHRULPSRVVLEOHLQDFHUWDLQV\VWHPJLYHQWKDWWKH\UH
IOHFWWKHDFWXDOFRQGLWLRQLQWKHV\VWHPXQGHULQYHVWLJDWLRQ7KXVZHWKLQNWKDWWKHUH IOHFWWKHDFWXDOFRQGLWLRQLQWKHV\VWHPXQGHULQYHVWLJDWLRQ7KXVZHWKLQNWKDWWKHUH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH

LV D QHHG IRU D WKHUPRG\QDPLFDOO\ FRQVLVWHQW GHVFULSWLRQ RI WKH HOHFWURFKHPLVWU\ RI LV D QHHG IRU D WKHUPRG\QDPLFDOO\ FRQVLVWHQW GHVFULSWLRQ RI WKH HOHFWURFKHPLVWU\ RI
VWHHOLQFRQFUHWH7KHSURSRVHGDSSURDFKWRWKDWGHVFULSWLRQLVVXPPDULVHGLQWKLV6HF VWHHOLQFRQFUHWH7KHSURSRVHGDSSURDFKWRWKDWGHVFULSWLRQLVVXPPDULVHGLQWKLV6HF
WLRQ ZKLFK GLIIHUV WR TXLWH VRPH H[WHQW IURP WKH GHVFULSWLRQ RI FDUERQ VWHHO UHLQ WLRQ ZKLFK GLIIHUV WR TXLWH VRPH H[WHQW IURP WKH GHVFULSWLRQ RI FDUERQ VWHHO UHLQ
IRUFHPHQWFRUURVLRQLQWH[WERRNV IRUFHPHQWFRUURVLRQLQWH[WERRNV
%HIRUH WKH GLIIHUHQW VWDWHV DQG FRQGLWLRQV RI UHLQIRUFHPHQW FRUURVLRQ DUH GHVFULEHG %HIRUH WKH GLIIHUHQW VWDWHV DQG FRQGLWLRQV RI UHLQIRUFHPHQW FRUURVLRQ DUH GHVFULEHG
EDVHGRQUHDFWLRQPHFKDQLVPVDQGWKH3RXUEDL[GLDJUDPLQ6HFWLRQRXUJHQHUDO EDVHGRQUHDFWLRQPHFKDQLVPVDQGWKH3RXUEDL[GLDJUDPLQ6HFWLRQRXUJHQHUDO
FRQFHSWRIWKHHOHFWURFKHPLVWU\RIVWHHOLQFRQFUHWHDQGSRVVLEOHPLVFRQFHSWLRQVLQWKH FRQFHSWRIWKHHOHFWURFKHPLVWU\RIVWHHOLQFRQFUHWHDQGSRVVLEOHPLVFRQFHSWLRQVLQWKH
OLWHUDWXUHDUHGLVFXVVHGLQ6HFWLRQ OLWHUDWXUHDUHGLVFXVVHGLQ6HFWLRQ
,WVKRXOGDOVREHQRWHGWKDWWKLV&KDSWHURQO\GHDOVZLWKWKHWKHUPRG\QDPLFSULQFLSOHV ,WVKRXOGDOVREHQRWHGWKDWWKLV&KDSWHURQO\GHDOVZLWKWKHWKHUPRG\QDPLFSULQFLSOHV
WKDWDSSO\WRFDUERQVWHHOLQRUGLQDU\3RUWODQGFHPHQWFRQFUHWH7KHHOHFWURFKHPLVWU\ WKDWDSSO\WRFDUERQVWHHOLQRUGLQDU\3RUWODQGFHPHQWFRQFUHWH7KHHOHFWURFKHPLVWU\
RIRWKHUUHLQIRUFHPHQW PDWHULDOVDQGWKHHIIHFW RIPLQHUDODGGLWLRQVDQGRUFKHPLFDO RIRWKHUUHLQIRUFHPHQW PDWHULDOVDQGWKHHIIHFW RIPLQHUDODGGLWLRQVDQGRUFKHPLFDO
DGPL[WXUHVDUHVXPPDULVHGLQ&KDSWHU DGPL[WXUHVDUHVXPPDULVHGLQ&KDSWHU
&RUURVLRQ UDWHV RI VWHHO LQ FRQFUHWH DUH RQO\ PDUJLQDOO\ GHDOW ZLWK LQ WKLV &KDSWHU &RUURVLRQ UDWHV RI VWHHO LQ FRQFUHWH DUH RQO\ PDUJLQDOO\ GHDOW ZLWK LQ WKLV &KDSWHU
$PRQJDEXQGDQWSXEOLFDWLRQVUHIHUHQFHLVPDGHWRWH[WERRNVRQUHLQIRUFHPHQWFRUUR $PRQJDEXQGDQWSXEOLFDWLRQVUHIHUHQFHLVPDGHWRWH[WERRNVRQUHLQIRUFHPHQWFRUUR
VLRQ HJ >6FKLH‰O HWDO  %URRPILHOG  %HQWXU HWDO  &LJQD HWDO VLRQ HJ >6FKLH‰O HWDO  %URRPILHOG  %HQWXU HWDO  &LJQD HWDO
%HUWROLQLHWDO%|KQLHWDO5DXSDFKHWDO@$OVRVWUXFWXUDO %HUWROLQLHWDO%|KQLHWDO5DXSDFKHWDO@$OVRVWUXFWXUDO
DVSHFWVFRQFHUQLQJFRUURVLRQDQGFRUURVLRQGDPDJHDUHWUHDWHGUDWKHUPDUJLQDOO\%H DVSHFWVFRQFHUQLQJFRUURVLRQDQGFRUURVLRQGDPDJHDUHWUHDWHGUDWKHUPDUJLQDOO\%H
VLGHV WKH WKHRU\ RQ WKH PRVW LPSRUWDQW VWUXFWXUDO DVSHFWV FRQWUROOLQJ UHLQIRUFHPHQW VLGHV WKH WKHRU\ RQ WKH PRVW LPSRUWDQW VWUXFWXUDO DVSHFWV FRQWUROOLQJ UHLQIRUFHPHQW
FRUURVLRQZKLFKZDVEULHIO\VXPPDULVHGLQ&KDSWHUUHIHUHQFHLVPDGHWRWKHDERYH FRUURVLRQZKLFKZDVEULHIO\VXPPDULVHGLQ&KDSWHUUHIHUHQFHLVPDGHWRWKHDERYH
OLWHUDWXUHZKHUHWKHVHVXEMHFWVDUHJHQHUDOO\GHDOWZLWKLQGHWDLO OLWHUDWXUHZKHUHWKHVHVXEMHFWVDUHJHQHUDOO\GHDOWZLWKLQGHWDLO

 (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH  (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH


$FFRUGLQJWR>6FKLH‰OHWDO@LWLV RUUDWKHULWZDV QRWXQFRPPRQWRILQGWKH $FFRUGLQJWR>6FKLH‰OHWDO@LWLV RUUDWKHULWZDV QRWXQFRPPRQWRILQGWKH
RSLQLRQH[SUHVVHGWKDWFRQFUHWHSURWHFWVWKHUHLQIRUFLQJVWHHOE\SUHYHQWLQJLQJUHVVRI RSLQLRQH[SUHVVHGWKDWFRQFUHWHSURWHFWVWKHUHLQIRUFLQJVWHHOE\SUHYHQWLQJLQJUHVVRI
ZDWHUDQGR[\JHQ7KLVPLVFRQFHSWLRQZKLFKPLJKWEHGXHWRREVHUYDWLRQVRIDWPRV ZDWHUDQGR[\JHQ7KLVPLVFRQFHSWLRQZKLFKPLJKWEHGXHWRREVHUYDWLRQVRIDWPRV
SKHULFVWHHOFRUURVLRQ HJWKHPHFKDQLVPGHVFULEHGLQ6HFWLRQ GRHVSUREDEO\ SKHULFVWHHOFRUURVLRQ HJWKHPHFKDQLVPGHVFULEHGLQ6HFWLRQ GRHVSUREDEO\
QRWUHSUHVHQWWKHSUHVHQWXQGHUVWDQGLQJRISHRSOHLQWKHFRQFUHWHEXVLQHVVEXWLWUH QRWUHSUHVHQWWKHSUHVHQWXQGHUVWDQGLQJRISHRSOHLQWKHFRQFUHWHEXVLQHVVEXWLWUH
IOHFWVVRPHPLVXQGHUVWDQGLQJVDERXWWKHWKHUPRG\QDPLFVRIVWHHOLQFRQFUHWHLQSDU IOHFWVVRPHPLVXQGHUVWDQGLQJVDERXWWKHWKHUPRG\QDPLFVRIVWHHOLQFRQFUHWHLQSDU
WLFXODUZLWKUHJDUGWRWKHSDVVLYHVWDWHDQGWKHGHYHORSPHQWRIWKHFRUURVLRQSRWHQWLDO WLFXODUZLWKUHJDUGWRWKHSDVVLYHVWDWHDQGWKHGHYHORSPHQWRIWKHFRUURVLRQSRWHQWLDO
)URP6HFWLRQLWFDQEHFRQFOXGHGWKDWFRQFUHWHLVQHLWKHUZDWHUWLJKWQRUDLUWLJKW )URP6HFWLRQLWFDQEHFRQFOXGHGWKDWFRQFUHWHLVQHLWKHUZDWHUWLJKWQRUDLUWLJKW
6R QRZDGD\V WKHUH LV D JHQHUDO DJUHHPHQW WKDW VWHHO LQ XQFRQWDPLQDWHG FRQFUHWH LV 6R QRZDGD\V WKHUH LV D JHQHUDO DJUHHPHQW WKDW VWHHO LQ XQFRQWDPLQDWHG FRQFUHWH LV
SURWHFWHGE\WKHIRUPDWLRQRIDVWDEOHDQGGHQVHSDVVLYHOD\HUGXHWRWKHKLJKDONDOLQ SURWHFWHGE\WKHIRUPDWLRQRIDVWDEOHDQGGHQVHSDVVLYHOD\HUGXHWRWKHKLJKDONDOLQ
LW\RIWKHSRUHVROXWLRQ FI6HFWLRQ +RZHYHULQVRPHGHVFULSWLRQVRIWKHSDV LW\RIWKHSRUHVROXWLRQ FI6HFWLRQ +RZHYHULQVRPHGHVFULSWLRQVRIWKHSDV
VLYHVWDWHLQWKHOLWHUDWXUHRQUHLQIRUFHPHQWFRUURVLRQWKHFKDUDFWHURIWKHDQRGLFDQG VLYHVWDWHLQWKHOLWHUDWXUHRQUHLQIRUFHPHQWFRUURVLRQWKHFKDUDFWHURIWKHDQRGLFDQG
FDWKRGLF UHDFWLRQV OHDGLQJ WR WKH IRUPDWLRQRIWKHSDVVLYHOD\HUDQG WKH IDFW WKDW WKH FDWKRGLF UHDFWLRQV OHDGLQJ WR WKH IRUPDWLRQRIWKHSDVVLYHOD\HUDQG WKH IDFW WKDW WKH
OD\HULVQRWIRUPHGGHVSLWHEXWGXHWRWKHSUHVHQFHRIR[\JHQDQGZDWHUVHHPQRWWR OD\HULVQRWIRUPHGGHVSLWHEXWGXHWRWKHSUHVHQFHRIR[\JHQDQGZDWHUVHHPQRWWR
EHIXOO\DFNQRZOHGJHG,QUHODWLRQWRWKDWWKHHIIHFWRIR[\JHQDQGZDWHURQWKHFRU EHIXOO\DFNQRZOHGJHG,QUHODWLRQWRWKDWWKHHIIHFWRIR[\JHQDQGZDWHURQWKHFRU
URVLRQSRWHQWLDORIVWHHOLQFRQFUHWHVHHPVWREHPLVLQWHUSUHWHGLQVRPHOLWHUDWXUH URVLRQSRWHQWLDORIVWHHOLQFRQFUHWHVHHPVWREHPLVLQWHUSUHWHGLQVRPHOLWHUDWXUH

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


(OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

 $QRGLF&RUURVLRQ3URGXFWV  $QRGLF&RUURVLRQ3URGXFWV


,Q6HFWLRQLWZDVPHQWLRQHGWKDWDFFRUGLQJWR>%DUGDO@3DVVLYHOD\HUV³ ,Q6HFWLRQLWZDVPHQWLRQHGWKDWDFFRUGLQJWR>%DUGDO@3DVVLYHOD\HUV³
DUH QRW IRUPHG E\ GHSRVLWLRQ RI FRUURVLRQ SURGXFWV IURP WKH OLTXLG DV WKLV XVXDOO\ DUH QRW IRUPHG E\ GHSRVLWLRQ RI FRUURVLRQ SURGXFWV IURP WKH OLTXLG DV WKLV XVXDOO\
JLYHVPRUHRUOHVVSRURXVVXUIDFHOD\HUVEXWWKDWWKHR[LGHLVGLUHFWO\IRUPHGLQFORVH JLYHVPRUHRUOHVVSRURXVVXUIDFHOD\HUVEXWWKDWWKHR[LGHLVGLUHFWO\IRUPHGLQFORVH
FRQQHFWLRQ ZLWK WKH FU\VWDO VWUXFWXUH RI WKH PHWDO´ +RZHYHU WKLV FHQWUDO DVSHFW FRQQHFWLRQ ZLWK WKH FU\VWDO VWUXFWXUH RI WKH PHWDO´ +RZHYHU WKLV FHQWUDO DVSHFW
VHHPVWREHRIWHQRYHUORRNHGLQWKHGHVFULSWLRQRIWKHSDVVLYHDQGDFWLYHFRUURVLRQLQ VHHPVWREHRIWHQRYHUORRNHGLQWKHGHVFULSWLRQRIWKHSDVVLYHDQGDFWLYHFRUURVLRQLQ
VRPHOLWHUDWXUHRQUHLQIRUFHPHQWFRUURVLRQLQSDUWLFXODULQWH[WERRNV,WDSSHDUVWKDWLW VRPHOLWHUDWXUHRQUHLQIRUFHPHQWFRUURVLRQLQSDUWLFXODULQWH[WERRNV,WDSSHDUVWKDWLW
LV RIWHQ QRW DFNQRZOHGJHG WKDW WKH SDVVLYH VWDWH LV EDVHG RQ WKH VDPH SULQFLSOHV DV LV RIWHQ QRW DFNQRZOHGJHG WKDW WKH SDVVLYH VWDWH LV EDVHG RQ WKH VDPH SULQFLSOHV DV
DFWLYH FRUURVLRQ LH D FRPELQDWLRQ RI DQRGLF R[LGDWLRQ ZLWK RQH RU PRUH FDWKRGLF DFWLYH FRUURVLRQ LH D FRPELQDWLRQ RI DQRGLF R[LGDWLRQ ZLWK RQH RU PRUH FDWKRGLF
UHGXFWLRQUHDFWLRQV,QSULQFLSOHWKHRQO\EXWVLJQLILFDQWGLIIHUHQFHEHWZHHQWKHDF UHGXFWLRQUHDFWLRQV,QSULQFLSOHWKHRQO\EXWVLJQLILFDQWGLIIHUHQFHEHWZHHQWKHDF
WLYHDQGSDVVLYHVWDWHLVWKDWGLIIHUHQWLURQVSHFLHVDUHIRUPHGE\WKHDQRGLFUHDFWLRQ WLYHDQGSDVVLYHVWDWHLVWKDWGLIIHUHQWLURQVSHFLHVDUHIRUPHGE\WKHDQRGLFUHDFWLRQ
DQGWKHHQRUPRXVGLIIHUHQFHLQWKHFRUURVLRQUDWHVZKLFKLVFORVHO\OLQNHGWRWKHW\SH DQGWKHHQRUPRXVGLIIHUHQFHLQWKHFRUURVLRQUDWHVZKLFKLVFORVHO\OLQNHGWRWKHW\SH
RI SURGXFWV IRUPHG )URP D WKHUPRG\QDPLF SHUVSHFWLYH WKLV GLIIHUHQFH LV EDVHG RQ RI SURGXFWV IRUPHG )URP D WKHUPRG\QDPLF SHUVSHFWLYH WKLV GLIIHUHQFH LV EDVHG RQ
WKH IDFW WKDW GLVVLPLODU VSHFLHV DUH IDYRXUHG GHSHQGLQJ RQ WKH FRUURVLRQ SRWHQWLDO WKH IDFW WKDW GLVVLPLODU VSHFLHV DUH IDYRXUHG GHSHQGLQJ RQ WKH FRUURVLRQ SRWHQWLDO
µ(FRUU¶DQGWKHS+DWWKHVWHHOHOHFWURO\WHLQWHUIDFH7KHVLPLODULW\EHWZHHQDFWLYHFRU µ(FRUU¶DQGWKHS+DWWKHVWHHOHOHFWURO\WHLQWHUIDFH7KHVLPLODULW\EHWZHHQDFWLYHFRU
URVLRQ DQG SDVVLYLW\ LV H[HPSOLILHG E\ WKH VWDQGDUG µ6(3'¶ RI WKH )H+2 ZLWK DQ URVLRQ DQG SDVVLYLW\ LV H[HPSOLILHG E\ WKH VWDQGDUG µ6(3'¶ RI WKH )H+2 ZLWK DQ
LURQLRQDFWLYLW\RIíPRO/LQ)LJXUHZKLFKZHDVVXPHWRVXIILFLHQWO\UHIOHFW LURQLRQDFWLYLW\RIíPRO/LQ)LJXUHZKLFKZHDVVXPHWRVXIILFLHQWO\UHIOHFW
WKHFKORULGHIUHHFRQFUHWHVWHHOHQYLURQPHQW FI6HFWLRQ  WKHFKORULGHIUHHFRQFUHWHVWHHOHQYLURQPHQW FI6HFWLRQ 

 
)LJXUH )H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD í PRO/,GHQWLILFD )LJXUH )H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD í PRO/,GHQWLILFD
WLRQRISRVVLEOHUDQJHRIµ(FRUU¶DQGS+IRUFDUERQVWHHOLQ $ RUJDQLF WLRQRISRVVLEOHUDQJHRIµ(FRUU¶DQGS+IRUFDUERQVWHHOLQ $ RUJDQLF
ULFKODNHZDWHUDQG % XQFRQWDPLQDWHGVHPLVDWXUDWHGFRQFUHWH ULFKODNHZDWHUDQG % XQFRQWDPLQDWHGVHPLVDWXUDWHGFRQFUHWH
6LQFHWKLV3RXUEDL[GLDJUDPLVDVVXPHGWREHYDOLGIRUJHQHUDODTXHRXVFRUURVLRQLWLV 6LQFHWKLV3RXUEDL[GLDJUDPLVDVVXPHGWREHYDOLGIRUJHQHUDODTXHRXVFRUURVLRQLWLV
XVHGWRH[HPSOLI\DSDVVLYHDQGDQDFWLYHFRUURVLRQFRQGLWLRQIRUDVXUIDFHRILURQDQG XVHGWRH[HPSOLI\DSDVVLYHDQGDQDFWLYHFRUURVLRQFRQGLWLRQIRUDVXUIDFHRILURQDQG
KHPDWLWHHJDSLHFHRIFDUERQVWHHO WKDWZDVLQLWLDOO\VWRUHGXQGHUDWPRVSKHULFFRQ KHPDWLWHHJDSLHFHRIFDUERQVWHHO WKDWZDVLQLWLDOO\VWRUHGXQGHUDWPRVSKHULFFRQ
GLWLRQV DQG VXEPHUJHG LQ $  RUJDQLF ULFK ODNH ZDWHU DQG %  HPEHGGHG LQ XQFRQ GLWLRQV DQG VXEPHUJHG LQ $  RUJDQLF ULFK ODNH ZDWHU DQG %  HPEHGGHG LQ XQFRQ
WDPLQDWHGVHPLVDWXUDWHGFRQFUHWH7KHIROORZLQJWKHUPRG\QDPLFFRQGLWLRQVDSSO\LQ WDPLQDWHGVHPLVDWXUDWHGFRQFUHWH7KHIROORZLQJWKHUPRG\QDPLFFRQGLWLRQVDSSO\LQ
WKHVHWZRFDVHV WKHVHWZRFDVHV

 

:HFRQVLGHUFDUERQVWHHOWREHLQWHUFKDQJHDEOHZLWKLURQLQUHODWLRQWRWKHLUHOHFWURFKHPLFDOSURSHU :HFRQVLGHUFDUERQVWHHOWREHLQWHUFKDQJHDEOHZLWKLURQLQUHODWLRQWRWKHLUHOHFWURFKHPLFDOSURSHU
WLHV FI6HFWLRQ  WLHV FI6HFWLRQ 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH

‡ ,QFDVH $ WKHµ(FRUU¶FDQEHDVVXPHGWREHDURXQGP96+(>:28@DQGWKH ‡ ,QFDVH $ WKHµ(FRUU¶FDQEHDVVXPHGWREHDURXQGP96+(>:28@DQGWKH


S+ DW WKH VWHHOHOHFWURO\WH LQWHUIDFH WREH DURXQG  >0¡OOHUE@ 8QGHU WKHVH S+ DW WKH VWHHOHOHFWURO\WH LQWHUIDFH WREH DURXQG  >0¡OOHUE@ 8QGHU WKHVH
FRQGLWLRQVWKHLURQRQWKHVXUIDFHZLOOQRWVWDUWWRGLVVROYHDEUXSWO\EXWZLOOGLV FRQGLWLRQVWKHLURQRQWKHVXUIDFHZLOOQRWVWDUWWRGLVVROYHDEUXSWO\EXWZLOOGLV
VROYHVWHDGLO\WRIRUPVROXEOHIHUURXVLRQJRYHUQHGE\WKHWKHUPRG\QDPLFDOO\ID VROYHVWHDGLO\WRIRUPVROXEOHIHUURXVLRQJRYHUQHGE\WKHWKHUPRG\QDPLFDOO\ID
YRXUHGUHDFWLRQ YRXUHGUHDFWLRQ

 )H → )H + + H− (( 
 = −  {} P96+( )  >@  )H → )H + + H− (( 
 = −  {} P96+( )  >@

µ(FRUU¶LVLQWKHWKHRUHWLFDOVWDELOLW\GRPDLQRIZDWHUDQG>@SURFHHGVDORQJZLWK µ(FRUU¶LVLQWKHWKHRUHWLFDOVWDELOLW\GRPDLQRIZDWHUDQG>@SURFHHGVDORQJZLWK
UHGXFWLRQRIR[\JHQLQDFLGVROXWLRQVDVGRPLQDQWFDWKRGLFUHDFWLRQ UHGXFWLRQRIR[\JHQLQDFLGVROXWLRQVDVGRPLQDQWFDWKRGLFUHDFWLRQ

 2  + + + + H − → +  2 (( 
 =  {} P96+( )  >@  2  + + + + H − → +  2 (( 
 =  {} P96+( )  >@

7KHUHGXFWLRQRIR[\JHQ>@FDQEHVXSSRUWHGE\WKHUHGXFWLRQRI)H2ZKLFK 7KHUHGXFWLRQRIR[\JHQ>@FDQEHVXSSRUWHGE\WKHUHGXFWLRQRI)H2ZKLFK
LVLQLWLDOO\SUHVHQWDWWKHVXUIDFH LVLQLWLDOO\SUHVHQWDWWKHVXUIDFH

 )H 2 + + + + H − → )H + + +  2 (( 
 =  P96+( )  >@  )H 2 + + + + H − → )H + + +  2 (( 
 =  P96+( )  >@

‡ ,QFDVH % WKHµ(FRUU¶FDQEHDVVXPHGWRDOVREHDURXQGP96+(DQGWKHS+DWWKH ‡ ,QFDVH % WKHµ(FRUU¶FDQEHDVVXPHGWRDOVREHDURXQGP96+(DQGWKHS+DWWKH


VWHHOHOHFWURO\WHLQWHUIDFHLQXQFRQWDPLQDWHGFRQFUHWHWREHDURXQG FI6HFWLRQ VWHHOHOHFWURO\WHLQWHUIDFHLQXQFRQWDPLQDWHGFRQFUHWHWREHDURXQG FI6HFWLRQ
 8QGHUWKLVFRQGLWLRQWKHKHPDWLWHRQWKHVXUIDFHLVWKHUPRG\QDPLFDOO\VWD  8QGHUWKLVFRQGLWLRQWKHKHPDWLWHRQWKHVXUIDFHLVWKHUPRG\QDPLFDOO\VWD
EOH DQG WKH LURQ RQ WKH VXUIDFH VWDUWV WREH R[LGLVHG QRW DEUXSWO\EXWVWHDGLO\WR EOH DQG WKH LURQ RQ WKH VXUIDFH VWDUWV WREH R[LGLVHG QRW DEUXSWO\EXWVWHDGLO\WR
IRUPVROLGKHPDWLWHJRYHUQHGE\WKHWKHUPRG\QDPLFDOO\IDYRXUHGUHDFWLRQ IRUPVROLGKHPDWLWHJRYHUQHGE\WKHWKHUPRG\QDPLFDOO\IDYRXUHGUHDFWLRQ

 )H + +  2 → )H  2 + + + + H − (( 
 = −  P96+( )  >@  )H + +  2 → )H 2 + + + + H − (( 
 = −  P96+( )  >@

$VLQFDVH $ WKHµ(FRUU¶LVLQWKHWKHRUHWLFDOVWDELOLW\GRPDLQRIZDWHUDQG>@ $VLQFDVH $ WKHµ(FRUU¶LVLQWKHWKHRUHWLFDOVWDELOLW\GRPDLQRIZDWHUDQG>@


SURFHHGVZLWKUHGXFWLRQRIR[\JHQLQWKHDONDOLQHHQYLURQPHQWDV FDWKRGLF UHDF SURFHHGVZLWKUHGXFWLRQRIR[\JHQLQWKHDONDOLQHHQYLURQPHQWDV FDWKRGLF UHDF
WLRQ WLRQ

 2  + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@  2  + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@

7KXVERWKDFWLYHFRUURVLRQDQGSDVVLYLW\FRQVLVWRIDQRGLFR[LGDWLRQUHDFWLRQV,QWKH 7KXVERWKDFWLYHFRUURVLRQDQGSDVVLYLW\FRQVLVWRIDQRGLFR[LGDWLRQUHDFWLRQV,QWKH
DFWLYH FRUURVLRQ FDVH $  LURQ LV R[LGLVHG WR IRUP VROXEOH )H LH )H LV GLVVROYHG DFWLYH FRUURVLRQ FDVH $  LURQ LV R[LGLVHG WR IRUP VROXEOH )H LH )H LV GLVVROYHG
ZKHUHDVLQWKHSDVVLYLW\FDVH % LURQLVGLUHFWO\R[LGLVHGWRVROLG)H2ZKLFKFRQVWL ZKHUHDVLQWKHSDVVLYLW\FDVH % LURQLVGLUHFWO\R[LGLVHGWRVROLG)H2ZKLFKFRQVWL
WXWHVWKHIRUPDWLRQRIWKHSDVVLYHOD\HU WXWHVWKHIRUPDWLRQRIWKHSDVVLYHOD\HU
'LVUHJDUGLQJWKHORZSRWHQWLDOFRUURVLRQGRPDLQZKLFKIDYRXUVIRUPDWLRQRIVROXEOH 'LVUHJDUGLQJWKHORZSRWHQWLDOFRUURVLRQGRPDLQZKLFKIDYRXUVIRUPDWLRQRIVROXEOH
+)H2í FI6HFWLRQ IURPWKH3RXUEDL[GLDJUDPLQ)LJXUHLWFDQEHFRQ +)H2í FI6HFWLRQ IURPWKH3RXUEDL[GLDJUDPLQ)LJXUHLWFDQEHFRQ
FOXGHGWKDWQRVROXEOHVSHFLHVDUHWKHUPRG\QDPLFDOO\IDYRXUHGWREHIRUPHGLQWKHS+ FOXGHGWKDWQRVROXEOHVSHFLHVDUHWKHUPRG\QDPLFDOO\IDYRXUHGWREHIRUPHGLQWKHS+
UDQJH RI XQFRQWDPLQDWHG FRQFUHWH LH S+  FI 6HFWLRQ   +RZHYHU ZLWK UDQJH RI XQFRQWDPLQDWHG FRQFUHWH LH S+  FI 6HFWLRQ   +RZHYHU ZLWK
GHSDVVLYDWLRQE\FDUERQDWLRQRUFKORULGH LQGXFHG FRUURVLRQ FI 6HFWLRQV DQG GHSDVVLYDWLRQE\FDUERQDWLRQRUFKORULGH LQGXFHG FRUURVLRQ FI 6HFWLRQV DQG
UHVSHFWLYHO\ WKHS+DWWKHFRQFUHWHVWHHOLQWHUIDFHDSSURDFKHVYDOXHVWKDWID UHVSHFWLYHO\ WKHS+DWWKHFRQFUHWHVWHHOLQWHUIDFHDSSURDFKHVYDOXHVWKDWID
YRXU WKH DQRGLF GLVVROXWLRQ UHDFWLRQ IRUPLQJ )H >@ WR WDNH SODFH 'HSHQGLQJ RQ YRXU WKH DQRGLF GLVVROXWLRQ UHDFWLRQ IRUPLQJ )H >@ WR WDNH SODFH 'HSHQGLQJ RQ
WKHDYDLODELOLW\RIR[\JHQWKHVROXEOH)HH[SHULHQFHVIXUWKHUWUDQVIRUPDWLRQVZKLFK WKHDYDLODELOLW\RIR[\JHQWKHVROXEOH)HH[SHULHQFHVIXUWKHUWUDQVIRUPDWLRQVZKLFK
DUHGHVFULEHGLQGHWDLOLQ6HFWLRQ DUHGHVFULEHGLQGHWDLOLQ6HFWLRQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


(OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

$VPHQWLRQHGLQ6HFWLRQVDQGWKH SDVVLYHOD\HULPSHGHV WKH FRUURVLRQ $VPHQWLRQHGLQ6HFWLRQVDQGWKH SDVVLYHOD\HULPSHGHV WKH FRUURVLRQ


NLQHWLFVZKLFKODUJHO\OLPLWVIXUWKHUDQRGLFGLVVROXWLRQRQFHDFHUWDLQWKLFNQHVVDQG NLQHWLFVZKLFKODUJHO\OLPLWVIXUWKHUDQRGLFGLVVROXWLRQRQFHDFHUWDLQWKLFNQHVVDQG
GHQVHQHVVLVDWWDLQHG7KHVHVORZNLQHWLFVHQDEOHFRUURVLRQUDWHVDVORZDV—P\LQ GHQVHQHVVLVDWWDLQHG7KHVHVORZNLQHWLFVHQDEOHFRUURVLRQUDWHVDVORZDV—P\LQ
WKHSDVVLYHVWDWH>$UXS@ZKHUHDVFRUURVLRQUDWHVXSWR—P\ FRQFUHWHFRQ WKHSDVVLYHVWDWH>$UXS@ZKHUHDVFRUURVLRQUDWHVXSWR—P\ FRQFUHWHFRQ
WDPLQDWHG E\ FKORULGH DW  VDWXUDWLRQ RU FDUERQDWHG FRQFUHWH DW  WDPLQDWHG E\ FKORULGH DW  VDWXUDWLRQ RU FDUERQDWHG FRQFUHWH DW 
VDWXUDWLRQ  RU XQGHU WKH ZRUVW FRQGLWLRQV XS WR HYHQ —P\ FRQFUHWH VHYHUHO\ VDWXUDWLRQ  RU XQGHU WKH ZRUVW FRQGLWLRQV XS WR HYHQ —P\ FRQFUHWH VHYHUHO\
FRQWDPLQDWHGE\ FKORULGH DW  VDWXUDWLRQ  KDYHEHHQ REVHUYHGIRUWKHDFWLYH FRQWDPLQDWHGE\ FKORULGH DW  VDWXUDWLRQ  KDYHEHHQ REVHUYHGIRUWKHDFWLYH
FRUURVLRQVWDWH>%HUWROLQLHWDO@ FRUURVLRQVWDWH>%HUWROLQLHWDO@
,QFRQFOXVLRQLWFDQEHVDLGWKDWERWKWKHSDVVLYHDQGWKHDFWLYHFRUURVLRQVWDWHFRQVWL ,QFRQFOXVLRQLWFDQEHVDLGWKDWERWKWKHSDVVLYHDQGWKHDFWLYHFRUURVLRQVWDWHFRQVWL
WXWH DQRGLF R[LGDWLRQ UHDFWLRQVEXW WKH GLIIHUHQFH LQ WKH UHDFWLRQNLQHWLFVZKLFKLQ WXWH DQRGLF R[LGDWLRQ UHDFWLRQVEXW WKH GLIIHUHQFH LQ WKH UHDFWLRQNLQHWLFV ZKLFKLQ
SULQFLSOH UHVXOWV IURP WKH GLIIHUHQFH LQ WKH SURGXFWV IRUPHG E\ WKH GLIIHUHQW DQRGLF SULQFLSOH UHVXOWV IURP WKH GLIIHUHQFH LQ WKH SURGXFWV IRUPHG E\ WKH GLIIHUHQW DQRGLF
UHDFWLRQLVHQRUPRXV7KLVDJDLQVKRZVWKHLPSRUWDQFHRINLQHWLFFRQVLGHUDWLRQVLQ UHDFWLRQLVHQRUPRXV7KLVDJDLQVKRZVWKHLPSRUWDQFHRINLQHWLFFRQVLGHUDWLRQVLQ
WKHDUHDRIUHLQIRUFHPHQWFRUURVLRQ+RZHYHUWKHW\SHRISURGXFWVIRUPHGE\WKHDQ WKHDUHDRIUHLQIRUFHPHQWFRUURVLRQ+RZHYHUWKHW\SHRISURGXFWVIRUPHGE\WKHDQ
RGLF UHDFWLRQ ZKLFK ZH XQGHUVWDQG WREH WKH IXQGDPHQWDOSDUDPHWHU FRQWUROOLQJWKH RGLF UHDFWLRQ ZKLFK ZH XQGHUVWDQG WREH WKH IXQGDPHQWDOSDUDPHWHU FRQWUROOLQJWKH
PDJQLWXGHRIWKHFRUURVLRQUDWHLVGHWHUPLQHGE\WKHWKHUPRG\QDPLFVRIWKHV\VWHP PDJQLWXGHRIWKHFRUURVLRQUDWHLVGHWHUPLQHGE\WKHWKHUPRG\QDPLFVRIWKHV\VWHP
7KXV ZH VXJJHVW WKDW D WKHUPRG\QDPLFDOO\ FRQVLVWHQW GHVFULSWLRQ RI UHLQIRUFHPHQW 7KXV ZH VXJJHVW WKDW D WKHUPRG\QDPLFDOO\ FRQVLVWHQW GHVFULSWLRQ RI UHLQIRUFHPHQW
FRUURVLRQDQGDWKHUPRG\QDPLFDOO\IRXQGHGGHVLJQRIFRXQWHUPHDVXUHVEDVHGRQWKLV FRUURVLRQDQGDWKHUPRG\QDPLFDOO\IRXQGHGGHVLJQRIFRXQWHUPHDVXUHVEDVHGRQWKLV
GHVFULSWLRQLVWKHNH\WRFRXQWHUDFWUHLQIRUFHPHQWFRUURVLRQ GHVFULSWLRQLVWKHNH\WRFRXQWHUDFWUHLQIRUFHPHQWFRUURVLRQ

 &RUURVLRQ3RWHQWLDO  &RUURVLRQ3RWHQWLDO


,QERWKFDVHV $ DQG % RIWKHH[HPSOLILFDWLRQLQ6HFWLRQWKH PDLQFDWKRGLF ,QERWKFDVHV $ DQG % RIWKHH[HPSOLILFDWLRQLQ6HFWLRQWKH PDLQFDWKRGLF
UHDFWLRQLVUHGXFWLRQRIR[\JHQ$VLVGLVFXVVHGLQPRUHGHWDLOLQ6HFWLRQZHDV UHDFWLRQLVUHGXFWLRQRIR[\JHQ$VLVGLVFXVVHGLQPRUHGHWDLOLQ6HFWLRQZHDV
VXPHWKDWWKHUHGXFWLRQRIR[\JHQLQWKHDONDOLQHHQYLURQPHQW>@LVWKHGRPLQDQW VXPHWKDWWKHUHGXFWLRQRIR[\JHQLQWKHDONDOLQHHQYLURQPHQW>@LVWKHGRPLQDQW
FDWKRGLFUHDFWLRQIRUVWHHOLQFRQFUHWHHVSHFLDOO\LQWKHSDVVLYHVWDWH$VGHVFULEHGLQ FDWKRGLFUHDFWLRQIRUVWHHOLQFRQFUHWHHVSHFLDOO\LQWKHSDVVLYHVWDWH$VGHVFULEHGLQ
6HFWLRQ  DQ DQRGLF UHDFWLRQ FDQQRW SURFHHG ZLWKRXW D FDWKRGLF UHDFWLRQ DQG WKXV 6HFWLRQ  DQ DQRGLF UHDFWLRQ FDQQRW SURFHHG ZLWKRXW D FDWKRGLF UHDFWLRQ DQG WKXV
WKHSDVVLYHFRPSRXQGVLHWKH)H2LQWKHDQRGLFUHDFWLRQ>@FDQQRWEHIRUPHG WKHSDVVLYHFRPSRXQGVLHWKH)H2LQWKHDQRGLFUHDFWLRQ>@FDQQRWEHIRUPHG
ZLWKRXWWKHFDWKRGLFUHDFWLRQ>@ZKLFKLQYROYHVFRQVXPSWLRQRIR[\JHQDQGZDWHU ZLWKRXWWKHFDWKRGLFUHDFWLRQ>@ZKLFKLQYROYHVFRQVXPSWLRQRIR[\JHQDQGZDWHU
WRIRUPK\GUR[\O7KLVDVSHFWXQGHUOLQHVWKDWWKHFRUURVLRQSURWHFWLRQRIIHUHGE\XQ WRIRUPK\GUR[\O7KLVDVSHFWXQGHUOLQHVWKDWWKHFRUURVLRQSURWHFWLRQRIIHUHGE\XQ
FRQWDPLQDWHGFRQFUHWHWRWKHHPEHGGHGVWHHOLVQRWDWWDLQHGGHVSLWHEXWGXHWKHSUHV FRQWDPLQDWHGFRQFUHWHWRWKHHPEHGGHGVWHHOLVQRWDWWDLQHGGHVSLWHEXWGXHWKHSUHV
HQFHRIR[\JHQDQGZDWHU HQFHRIR[\JHQDQGZDWHU
/HDYLQJ RXW WKH LQIOXHQFH RI WKH R[\JHQ DQG K\GURJHQ RYHUSRWHQWLDOV FI 6HFWLRQV /HDYLQJ RXW WKH LQIOXHQFH RI WKH R[\JHQ DQG K\GURJHQ RYHUSRWHQWLDOV FI 6HFWLRQV
DQG DQGUHGXFWLRQRIR[LGLVHGLURQVSHFLHVDVVXSSRUWLQJFDWKRGLFUHDF DQG DQGUHGXFWLRQRIR[LGLVHGLURQVSHFLHVDVVXSSRUWLQJFDWKRGLFUHDF
WLRQVWKHIROORZLQJFDQEHFRQFOXGHG IURPWKH3RXUEDL[GLDJUDPLQ)LJXUHZLWK WLRQVWKHIROORZLQJFDQEHFRQFOXGHG IURPWKH3RXUEDL[GLDJUDPLQ)LJXUHZLWK
UHJDUGWRSRVVLEOHFDWKRGLFUHDFWLRQV FI6HFWLRQVDQG  UHJDUGWRSRVVLEOHFDWKRGLFUHDFWLRQV FI6HFWLRQVDQG 
‡ ,IWKHHOHFWURGHSRWHQWLDOLQFDVH $ LVORZHUHG EHORZWKHK\GURJHQ HTXLOLEULXP ‡ ,IWKHHOHFWURGHSRWHQWLDOLQFDVH $ LVORZHUHG EHORZWKHK\GURJHQ HTXLOLEULXP
OLQHWKHUHGXFWLRQRIR[\JHQLQDFLGHOHFWURO\WHV>@LVVXSSRUWHGE\WKHK\GUR OLQHWKHUHGXFWLRQRIR[\JHQLQDFLGHOHFWURO\WHV>@LVVXSSRUWHGE\WKHK\GUR
JHQLRQUHGXFWLRQLQDFLGVROXWLRQV JHQLRQUHGXFWLRQLQDFLGVROXWLRQV

 + + + H − → +  (( 
 =  P96+( )  >@  + + + H − → +  (( 
 =  P96+( )  >@

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH

‡ ,I WKH HOHFWURGHSRWHQWLDO LQ FDVH %  LV ORZHUHG EHORZ WKHK\GURJHQHTXLOLEULXP ‡ ,I WKH HOHFWURGHSRWHQWLDO LQ FDVH %  LV ORZHUHG EHORZ WKHK\GURJHQHTXLOLEULXP
OLQHWKHUHGXFWLRQRIR[\JHQLQDONDOLQHHOHFWURO\WHV>@LVVXSSRUWHGE\WKHUH OLQHWKHUHGXFWLRQRIR[\JHQLQDONDOLQHHOHFWURO\WHV>@LVVXSSRUWHGE\WKHUH
GXFWLRQRIZDWHULQDONDOLQHVROXWLRQV GXFWLRQRIZDWHULQDONDOLQHVROXWLRQV

 +  2 + H − → +  + 2+ − (( 
 = −  ^−` P96+( )  >@  +  2 + H − → +  + 2+ − (( 
 = −  ^−` P96+( )  >@

‡ ,QERWKFDVHV $ DQG % UDLVLQJWKHHOHFWURGHSRWHQWLDODERYHWKHR[\JHQHTXLOLE ‡ ,QERWKFDVHV $ DQG % UDLVLQJWKHHOHFWURGHSRWHQWLDODERYHWKHR[\JHQHTXLOLE


ULXPOLQHOHDGVWRR[\JHQHYROXWLRQDVDQRGLFUHDFWLRQGHVFULEHGE\LQYHUWLQJUHDF ULXPOLQHOHDGVWRR[\JHQHYROXWLRQDVDQRGLFUHDFWLRQGHVFULEHGE\LQYHUWLQJUHDF
WLRQV>@DQG>@ WLRQV>@DQG>@
ƕ &DVH $ LHIRUPDWLRQRIR[\JHQLQWKHDFLGHQYLURQPHQW ƕ &DVH $ LHIRUPDWLRQRIR[\JHQLQWKHDFLGHQYLURQPHQW

  +  2 → 2  + + + + H − (( 
 =  {} P96+( )  >@   +  2 → 2  + + + + H − (( 
 =  {} P96+( )  >@

ƕ &DVH % LHIRUPDWLRQRIR[\JHQLQWKHDONDOLQHHQYLURQPHQW ƕ &DVH % LHIRUPDWLRQRIR[\JHQLQWKHDONDOLQHHQYLURQPHQW

  2+ − → 2  + +  2 + H − (( 
 =  {} P96+( )  >@   2+ − → 2  + +  2 + H − (( 
 =  {} P96+( )  >@

$QLQFUHDVHRUGHFUHDVH RIWKHHOHFWURGHSRWHQWLDOFRXOGWKHRUHWLFDOO\EH REWDLQHGLQ $Q LQFUHDVH RU GHFUHDVH RI WKH HOHFWURGHSRWHQWLDO FRXOGWKHRUHWLFDOO\EH REWDLQHGLQ
ERWKFDVHVE\DGGLWLRQRIDUHGXFLQJRUR[LGLVLQJDJHQW FI6HFWLRQ RUFDWKRGLF ERWKFDVHVE\DGGLWLRQRIDUHGXFLQJRUR[LGLVLQJDJHQW FI6HFWLRQ RUFDWKRGLF
RUDQRGLFSRODULVDWLRQ FI6HFWLRQ UHVSHFWLYHO\ RUDQRGLFSRODULVDWLRQ FI6HFWLRQ UHVSHFWLYHO\
7KH DERYH FRQVLGHUDWLRQV DUH EDVHG RQ WKH WKHRUHWLFDO HTXLOLEULXP OLQHV OLPLWLQJ WKH 7KH DERYH FRQVLGHUDWLRQV DUH EDVHG RQ WKH WKHRUHWLFDO HTXLOLEULXP OLQHV OLPLWLQJ WKH
VWDELOLW\GRPDLQRIZDWHU$VPHQWLRQHGLQ6HFWLRQLQSUDFWLFHWKHVHOLQHVZLOO VWDELOLW\GRPDLQRIZDWHU$VPHQWLRQHGLQ6HFWLRQLQSUDFWLFHWKHVHOLQHVZLOO
DOZD\VEHUHSODFHGE\WKHK\GURJHQDQGR[\JHQRYHUSRWHQWLDO7KHSUDFWLFDOPHDQLQJ DOZD\VEHUHSODFHGE\WKHK\GURJHQDQGR[\JHQRYHUSRWHQWLDO7KHSUDFWLFDOPHDQLQJ
RIWKHVHRYHUSRWHQWLDOVLQSDUWLFXODUZLWKUHJDUGWRK\GURJHQHYROXWLRQLQWKHDUHDRI RIWKHVHRYHUSRWHQWLDOVLQSDUWLFXODUZLWKUHJDUGWRK\GURJHQHYROXWLRQLQWKHDUHDRI
UHLQIRUFHPHQW FRUURVLRQ LV GLVFXVVHG LQ PRUH GHWDLO LQ &KDSWHUV  DQG  DV FHUWDLQ UHLQIRUFHPHQW FRUURVLRQ LV GLVFXVVHG LQ PRUH GHWDLO LQ &KDSWHUV  DQG  DV FHUWDLQ
FRXQWHUPHDVXUHVUHTXLUHDGGLWLRQDOFRQVLGHUDWLRQVRQWKDWVXEMHFW FRXQWHUPHDVXUHVUHTXLUHDGGLWLRQDOFRQVLGHUDWLRQVRQWKDWVXEMHFW
)RUWKHSXUSRVHRIWKLV6HFWLRQZHWKLQNWKDWLWLVVXIILFLHQWWRVWDWHWKDWUHGXFWLRQRI )RUWKHSXUSRVHRIWKLV6HFWLRQZHWKLQNWKDWLWLVVXIILFLHQWWRVWDWHWKDWUHGXFWLRQRI
R[\JHQLQWKHDONDOLQHHQYLURQPHQW>@LVWKHGRPLQDQWFDWKRGLFUHDFWLRQIRUXQSR R[\JHQLQWKHDONDOLQHHQYLURQPHQW>@LVWKHGRPLQDQWFDWKRGLFUHDFWLRQIRUXQSR
ODULVHG VWHHO LQ XQFRQWDPLQDWHG FRQFUHWH ,Q JHQHUDO ZH H[SHFW WKH IROORZLQJ WR EH ODULVHG VWHHO LQ XQFRQWDPLQDWHG FRQFUHWH ,Q JHQHUDO ZH H[SHFW WKH IROORZLQJ WR EH
WUXH IRU VWHHO LQ XQFRQWDPLQDWHG FRQFUHWH DW DQ\ GHJUHH RI VDWXUDWLRQ FI 6HFWLRQ WUXH IRU VWHHO LQ XQFRQWDPLQDWHG FRQFUHWH DW DQ\ GHJUHH RI VDWXUDWLRQ FI 6HFWLRQ
   
‡ :LWKRXW DQRGLF SRODULVDWLRQ HOHFWURGH SRWHQWLDOV OHDGLQJ WR WUDQVSDVVLYLW\ LH ‡ :LWKRXW DQRGLF SRODULVDWLRQ HOHFWURGH SRWHQWLDOV OHDGLQJ WR WUDQVSDVVLYLW\ LH
R[\JHQHYROXWLRQ DUHQRWREWDLQHGIRUVWHHOLQFRQFUHWHLHWKHKDOIFHOOUHDFWLRQV R[\JHQHYROXWLRQ DUHQRWREWDLQHGIRUVWHHOLQFRQFUHWHLHWKHKDOIFHOOUHDFWLRQV
>@DQG>@GRJHQHUDOO\QRWSOD\DUROHLQFRUURVLRQRIVWHHOLQFRQFUHWH7KLV >@DQG>@GRJHQHUDOO\QRWSOD\DUROHLQFRUURVLRQRIVWHHOLQFRQFUHWH7KLV
LQFOXGHV ZLWKFHUWDLQH[FHSWLRQV PRVWDYDLODEOHFRXQWHUPHDVXUHV FI&KDSWHU  LQFOXGHV ZLWKFHUWDLQH[FHSWLRQV PRVWDYDLODEOHFRXQWHUPHDVXUHV FI&KDSWHU 
+RZHYHUFHUWDLQPLVFRQFHSWLRQVDERXWWKHWUDQVSDVVLYLW\VWDWHRIVWHHOLQFRQFUHWH +RZHYHUFHUWDLQPLVFRQFHSWLRQVDERXWWKHWUDQVSDVVLYLW\VWDWHRIVWHHOLQFRQFUHWH
VHHPWRH[LVWLQWKHOLWHUDWXUHLQSDUWLFXODUZLWKUHJDUGWRWKHHIIHFWRIVWUD\FXU VHHPWRH[LVWLQWKHOLWHUDWXUHLQSDUWLFXODUZLWKUHJDUGWRWKHHIIHFWRIVWUD\FXU
UHQWV:HJHQHUDOO\DJUHHWKDWXQGHUFHUWDLQFRQGLWLRQVVWUD\FXUUHQWVFDQSRODULVH UHQWV:HJHQHUDOO\DJUHHWKDWXQGHUFHUWDLQFRQGLWLRQVVWUD\FXUUHQWVFDQSRODULVH
WKHUHLQIRUFLQJVWHHOWRYHU\QREOHSRWHQWLDOVVRWKDWWUDQVSDVVLYLW\FDQEHDWWDLQHG WKHUHLQIRUFLQJVWHHOWRYHU\QREOHSRWHQWLDOVVRWKDWWUDQVSDVVLYLW\FDQEHDWWDLQHG
<HWWKLVFRQGLWLRQGRHVQRWOHDGWRWKHGLVVROXWLRQRILURQ LHDFWLYHFRUURVLRQ LQ <HWWKLVFRQGLWLRQGRHVQRWOHDGWRWKHGLVVROXWLRQRILURQ LHDFWLYHFRUURVLRQ LQ
WKH ILUVW SODFH EHFDXVH WKH DQRGLF UHDFWLRQ LV R[\JHQ HYROXWLRQ ZKLFK FDQ WDNH WKH ILUVW SODFH EHFDXVH WKH DQRGLF UHDFWLRQ LV R[\JHQ HYROXWLRQ ZKLFK FDQ WDNH
SODFHRQWKHVXUIDFHRIWKHSDVVLYHOD\HU HOHFWURQFRQGXFWLQJEXWQRWLRQFRQGXFW SODFHRQWKHVXUIDFHRIWKHSDVVLYHOD\HU HOHFWURQFRQGXFWLQJEXWQRWLRQFRQGXFW
LQJ FI 6HFWLRQ   1HYHUWKHOHVV LI WKH KDOIFHOO UHDFWLRQ >@ LV WKHUPRG\ LQJ FI 6HFWLRQ   1HYHUWKHOHVV LI WKH KDOIFHOO UHDFWLRQ >@ LV WKHUPRG\

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


(OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

QDPLFDOO\ IDYRXUHG LQ WKH WUDQVSDVVLYLW\ VWDWH + LV VWHDGLO\ IRUPHG ZKLFK FDQ QDPLFDOO\ IDYRXUHG LQ WKH WUDQVSDVVLYLW\ VWDWH + LV VWHDGLO\ IRUPHG ZKLFK FDQ
HYHQWXDOO\ OHDG WR VXIILFLHQW QHXWUDOLVDWLRQ IRU GHSDVVLYDWLRQ DQG KHQFH LQLWLDWLRQ HYHQWXDOO\ OHDG WR VXIILFLHQW QHXWUDOLVDWLRQ IRU GHSDVVLYDWLRQ DQG KHQFH LQLWLDWLRQ
RIDFWLYHFRUURVLRQ RIDFWLYHFRUURVLRQ
‡ :LWKRXWFDWKRGLFSRODULVDWLRQHOHFWURGHSRWHQWLDOVOHDGLQJWRK\GURJHQLRQUHGXF ‡ :LWKRXWFDWKRGLFSRODULVDWLRQHOHFWURGHSRWHQWLDOVOHDGLQJWRK\GURJHQLRQUHGXF
WLRQ DUH JHQHUDOO\ QRW DWWDLQHG IRU VWHHO LQ XQFRQWDPLQDWHG FRQFUHWH FI 6HFWLRQ WLRQ DUH JHQHUDOO\ QRW DWWDLQHG IRU VWHHO LQ XQFRQWDPLQDWHG FRQFUHWH FI 6HFWLRQ
  :H DVVXPH WKDW WKH R[\JHQ GHSOHWLRQ UHTXLUHG WR ORZHU µ(FRUU¶ WR HQDEOH   :H DVVXPH WKDW WKH R[\JHQ GHSOHWLRQ UHTXLUHG WR ORZHU µ(FRUU¶ WR HQDEOH
K\GURJHQ LRQ UHGXFWLRQ LV HYHQ XQGHU ODERUDWRU\ FRQGLWLRQV GLIILFXOW WR DWWDLQ K\GURJHQ LRQ UHGXFWLRQ LV HYHQ XQGHU ODERUDWRU\ FRQGLWLRQV GLIILFXOW WR DWWDLQ
7KXVZHWKLQNWKDWWKHUHGXFWLRQRIZDWHULQDONDOLQHHOHFWURO\WHV >@ GRHV QRW 7KXVZHWKLQNWKDWWKHUHGXFWLRQRIZDWHULQDONDOLQHHOHFWURO\WHV >@ GRHV QRW
SOD\DVLJQLILFDQWUROHIRUWKHHOHFWURFKHPLVWU\RIFDUERQVWHHOLQXQFRQWDPLQDWHG SOD\DVLJQLILFDQWUROHIRUWKHHOHFWURFKHPLVWU\RIFDUERQVWHHOLQXQFRQWDPLQDWHG
FRQFUHWH FRQFUHWH
+RZHYHUXQGHUFHUWDLQFLUFXPVWDQFHVK\GURJHQLRQUHGXFWLRQFDQSOD\ DPLQRUUROH +RZHYHUXQGHUFHUWDLQFLUFXPVWDQFHVK\GURJHQLRQUHGXFWLRQFDQSOD\ DPLQRUUROH
LQ FDUERQDWHG FRQFUHWH DQG KDV D VLJQLILFDQW HIIHFW LQ FKORULGH LQGXFHG FRUURVLRQ LQ FDUERQDWHG FRQFUHWH DQG KDV D VLJQLILFDQW HIIHFW LQ FKORULGH LQGXFHG FRUURVLRQ
ZKLFKLVIXUWKHUHODERUDWHGLQ6HFWLRQ0RUHRYHUZHDVVXPHWKDWR[\JHQUHGXF ZKLFKLVIXUWKHUHODERUDWHGLQ6HFWLRQ0RUHRYHUZHDVVXPHWKDWR[\JHQUHGXF
WLRQLQDFLGHOHFWURO\WHV>@FDQFRPSOHPHQWR[\JHQUHGXFWLRQLQWKHDONDOLQHHQYL WLRQLQDFLGHOHFWURO\WHV>@FDQFRPSOHPHQWR[\JHQUHGXFWLRQLQWKHDONDOLQHHQYL
URQPHQW>@LQFDVHRIFKORULGHLQGXFHGFRUURVLRQ FI6HFWLRQ  URQPHQW>@LQFDVHRIFKORULGHLQGXFHGFRUURVLRQ FI6HFWLRQ 
,WLVDOVRLPSRUWDQWWRQRWHWKDWVRPHDYDLODEOHFRXQWHUPHDVXUHV FI6HFWLRQ DQGWKH ,WLVDOVRLPSRUWDQWWRQRWHWKDWVRPHDYDLODEOHFRXQWHUPHDVXUHV FI6HFWLRQ DQGWKH
SURSRVHG QHZ FRXQWHUPHDVXUHV FI 6HFWLRQ   LQFOXGH FRUURVLRQ SRWHQWLDOV WKDW VXU SURSRVHG QHZ FRXQWHUPHDVXUHV FI 6HFWLRQ   LQFOXGH FRUURVLRQ SRWHQWLDOV WKDW VXU
SDVV WKH WKHRUHWLFDO K\GURJHQ HTXLOLEULXP OLQH LH µ(FRUU¶ LV ORZHU WKDQ FI 6HFWLRQ SDVV WKH WKHRUHWLFDO K\GURJHQ HTXLOLEULXP OLQH LH µ(FRUU¶ LV ORZHU WKDQ FI 6HFWLRQ
   

( ++  + = −  × S+  >@ ( ++  + = −  × S+  >@


 

,QWKHVHFDVHVDQGIRUWKHFRQGLWLRQVXQGHUFKORULGHLQGXFHGFRUURVLRQRIFDUERQVWHHO ,QWKHVHFDVHVDQGIRUWKHFRQGLWLRQVXQGHUFKORULGHLQGXFHGFRUURVLRQRIFDUERQVWHHO
LQFRQFUHWHVSHFLDOFRQVLGHUDWLRQVRQWKHK\GURJHQRYHUSRWHQWLDODUHQHFHVVDU\ LQFRQFUHWHVSHFLDOFRQVLGHUDWLRQVRQWKHK\GURJHQRYHUSRWHQWLDODUHQHFHVVDU\
5HODWHGWRWKHDERYHFRQVLGHUDWLRQVRQWKHSRVVLEOHFDWKRGLFUHDFWLRQVWKHUHVHHPWR 5HODWHGWRWKHDERYHFRQVLGHUDWLRQVRQWKHSRVVLEOHFDWKRGLFUHDFWLRQVWKHUHVHHPWR
EH FRPPRQ PLVFRQFHSWLRQV LQ VRPH OLWHUDWXUH RQ UHLQIRUFHPHQW FRUURVLRQ UHODWHG WR EH FRPPRQ PLVFRQFHSWLRQV LQ VRPH OLWHUDWXUH RQ UHLQIRUFHPHQW FRUURVLRQ UHODWHG WR
WKHGHYHORSPHQWRIWKHFRUURVLRQSRWHQWLDOµ(FRUU¶RIVWHHOLQFRQFUHWH7KHUHIRUHWKH WKHGHYHORSPHQWRIWKHFRUURVLRQSRWHQWLDOµ(FRUU¶RIVWHHOLQFRQFUHWH7KHUHIRUHWKH
IROORZLQJVKRXOGEHHPSKDVLVHG IROORZLQJVKRXOGEHHPSKDVLVHG
‡ 'HYHORSPHQWDQGPDJQLWXGHRIµ(FRUU¶LQJHQHUDO ‡ 'HYHORSPHQWDQGPDJQLWXGHRIµ(FRUU¶LQJHQHUDO
$VH[HPSOLILHGE\WKHSRODULVDWLRQ FXUYHV LQ 6HFWLRQ  WKHFRUURVLRQ FXUUHQW $VH[HPSOLILHGE\WKHSRODULVDWLRQ FXUYHV LQ 6HFWLRQ  WKHFRUURVLRQ FXUUHQW
µLFRUU¶LQWKHSDVVLYHVWDWHLVGHWHUPLQHGE\WKHDQRGLFUHDFWLRQ,QFRUURVLRQVFLHQFH µLFRUU¶LQWKHSDVVLYHVWDWHLVGHWHUPLQHGE\WKHDQRGLFUHDFWLRQ,QFRUURVLRQVFLHQFH
OLWHUDWXUH WKLV FRQGLWLRQ LV FRPPRQO\ UHIHUUHG WR DV EHLQJ XQGHU DQRGLF FRQWURO OLWHUDWXUH WKLV FRQGLWLRQ LV FRPPRQO\ UHIHUUHG WR DV EHLQJ XQGHU DQRGLF FRQWURO
>%DUGDO@EHFDXVHWKHDQRGLFUHDFWLRQOLPLWVWKHFRUURVLRQUDWHGLVUHJDUGLQJ >%DUGDO@EHFDXVHWKHDQRGLFUHDFWLRQOLPLWVWKHFRUURVLRQUDWHGLVUHJDUGLQJ
WKHHTXLOLEULXPSRWHQWLDORIWKHFDWKRGLFUHDFWLRQDQGWKXVWKHPDJQLWXGHRIWKHUH WKHHTXLOLEULXPSRWHQWLDORIWKHFDWKRGLFUHDFWLRQDQGWKXVWKHPDJQLWXGHRIWKHUH
VXOWLQJFRUURVLRQSRWHQWLDOµ(FRUU¶ VXOWLQJFRUURVLRQSRWHQWLDOµ(FRUU¶
:LWKUHJDUGWRWKHGHYHORSPHQWDQGPDJQLWXGHRIµ(FRUU¶WKHWHUPDQRGLFFRQWURO :LWKUHJDUGWRWKHGHYHORSPHQWDQGPDJQLWXGHRIµ(FRUU¶WKHWHUPDQRGLFFRQWURO
VHHPV WR EH PLVOHDGLQJ VLQFH WKH HIIHFW RI WKH FDWKRGLF UHDFWLRQ RQ µ(FRUU¶ RIWHQ VHHPV WR EH PLVOHDGLQJ VLQFH WKH HIIHFW RI WKH FDWKRGLF UHDFWLRQ RQ µ(FRUU¶ RIWHQ
DSSHDUVWREHPLVLQWHUSUHWHG+HQFHWKHIROORZLQJVKRXOGEHQRWHG DSSHDUVWREHPLVLQWHUSUHWHG+HQFHWKHIROORZLQJVKRXOGEHQRWHG

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH

ƕ µ(FRUU¶LVQRWDSDUDPHWHURIDFHUWDLQPHWDOLQDFHUWDLQHOHFWURO\WHEXWREWDLQHG ƕ µ(FRUU¶LVQRWDSDUDPHWHURIDFHUWDLQPHWDOLQDFHUWDLQHOHFWURO\WHEXWREWDLQHG
DVWKHPL[HGSRWHQWLDORIWKHHTXLOLEULXPSRWHQWLDORIWKHDQRGLFUHDFWLRQµ(D¶ DVWKHPL[HGSRWHQWLDORIWKHHTXLOLEULXPSRWHQWLDORIWKHDQRGLFUHDFWLRQµ(D¶
DQGWKHFDWKRGLFUHDFWLRQµ(F¶ FI6HFWLRQ  DQGWKHFDWKRGLFUHDFWLRQµ(F¶ FI6HFWLRQ 
ƕ 7KHFDWKRGLFSURFHVVUDLVHVµ(FRUU¶ZKHUHDVWKHDQRGLFSURFHVVORZHUVµ(FRUU¶ ƕ 7KHFDWKRGLFSURFHVVUDLVHVµ(FRUU¶ZKHUHDVWKHDQRGLFSURFHVVORZHUVµ(FRUU¶
7KLVQRWLRQFDQEHFRPSUHKHQVLEO\LOOXVWUDWHGE\PHDQVRISRODULVDWLRQFXUYHV 7KLVQRWLRQFDQEHFRPSUHKHQVLEO\LOOXVWUDWHGE\PHDQVRISRODULVDWLRQFXUYHV
DVHJVKRZQLQ6HFWLRQ+RZHYHULWFDQDOVREHDFFHVVHGE\PHDQVRI DVHJVKRZQLQ6HFWLRQ+RZHYHULWFDQDOVREHDFFHVVHGE\PHDQVRI
WKHUPRG\QDPLF FRQVLGHUDWLRQV E\ TXDOLWDWLYH FRPSDULVRQ RI WKH HTXLOLEULXP WKHUPRG\QDPLF FRQVLGHUDWLRQV E\ TXDOLWDWLYH FRPSDULVRQ RI WKH HTXLOLEULXP
SRWHQWLDOV7KHµ(¶RIWKHDQRGLFDQGFDWKRGLFUHDFWLRQVGRHVQDWXUDOO\QRWUH SRWHQWLDOV7KHµ(¶RIWKHDQRGLFDQGFDWKRGLFUHDFWLRQVGRHVQDWXUDOO\QRWUH
IOHFW µ( D¶ DQG µ( F¶ WKDW JRYHUQ WKH HTXLOLEULXP DW D FHUWDLQ S+ +RZHYHU IOHFW µ( D¶ DQG µ( F¶ WKDW JRYHUQ WKH HTXLOLEULXP DW D FHUWDLQ S+ +RZHYHU
µ(¶RIWKHKDOIFHOOUHDFWLRQVFDOFXODWHGE\WKH1HUQVWHTXDWLRQFDQEHDSSOLHG µ(¶RIWKHKDOIFHOOUHDFWLRQVFDOFXODWHGE\WKH1HUQVWHTXDWLRQFDQEHDSSOLHG
IRU WKDW SXUSRVH FI 6HFWLRQ   7KLV LV VKRZQ EDVHG RQ WKH H[HPSOLILFD IRU WKDW SXUSRVH FI 6HFWLRQ   7KLV LV VKRZQ EDVHG RQ WKH H[HPSOLILFD
WLRQVJLYHQLQ6HFWLRQZKHUHDQµ(FRUU¶RIP96+(ZDVDVVXPHGIRUERWK WLRQVJLYHQLQ6HFWLRQZKHUHDQµ(FRUU¶RIP96+(ZDVDVVXPHGIRUERWK
FDVHV $ DWS+DQG % DWS+ FDVHV $ DWS+DQG % DWS+
x $QRGLFUHDFWLRQLQFDVH $  x $QRGLFUHDFWLRQLQFDVH $ 

  
)H → )H+ + H− (( 
 = −  {} P96+( ) >@   
)H → )H+ + H− (( 
 = −  {} P96+( ) >@
(  ( S+  ) = −  P96+( (  ( S+  ) = −  P96+(

x &DWKRGLFUHDFWLRQVLQFDVH $  x &DWKRGLFUHDFWLRQVLQFDVH $ 

  
2 + + + + H − → + 2 (( 
 =  {} P96+( ) >@   
2 + + + + H − → + 2 (( 
 =  {} P96+( ) >@
(  ( S+  ) =  P96+( (  ( S+  ) =  P96+(

  
)H 2 + + + + H − → )H + + +  2 (( 
 =  P96+( )
 >@   
)H 2 + + + + H − → )H + + +  2 (( 
 =  P96+( )
 >@
(  ( S+  ) =  P96+( (  ( S+  ) =  P96+(

x $QRGLFUHDFWLRQLQFDVH %  x $QRGLFUHDFWLRQLQFDVH % 

  
)H + +  2 → )H 2 + + + + H − (( 
 = −  P96+( ) >@   
)H + +  2 → )H 2 + + + + H − (( 
 = −  P96+( ) >@
(  ( S+ ) = −  P96+( (  ( S+ ) = −  P96+(

x &DWKRGLFUHDFWLRQLQFDVH %  x &DWKRGLFUHDFWLRQLQFDVH % 

  
2 + +  2 + H − → 2+ − (( 
 =  {} P96+( ) >@   
2 + +  2 + H − → 2+ − (( 
 =  {} P96+( ) >@
(  ( S+ ) =  P96+( (  ( S+ ) =  P96+(

7KHGLIIHUHQFHVLQWKHPDJQLWXGHVRIµ(¶DWWKHDVVRFLDWHGS+YDOXHVDQGWKH 7KHGLIIHUHQFHVLQWKHPDJQLWXGHVRIµ(¶DWWKHDVVRFLDWHGS+YDOXHVDQGWKH
DVVXPSWLRQV UHJDUGLQJ WKH DQRGLF DQG FDWKRGLF RYHUSRWHQWLDOV FI 6HFWLRQ DVVXPSWLRQV UHJDUGLQJ WKH DQRGLF DQG FDWKRGLF RYHUSRWHQWLDOV FI 6HFWLRQ
  SURYLGH D EHQHILFLDO LQGLFDWLRQ RQ WKH WKHUPRG\QDPLF FRQGLWLRQ RI WKH   SURYLGH D EHQHILFLDO LQGLFDWLRQ RQ WKH WKHUPRG\QDPLF FRQGLWLRQ RI WKH
V\VWHP V\VWHP
2UJDQLFULFKODNHZDWHUZDVFKRVHQIRUWKHH[HPSOLILFDWLRQSXUSRVHWRUHIHUWR 2UJDQLFULFKODNHZDWHUZDVFKRVHQIRUWKHH[HPSOLILFDWLRQSXUSRVHWRUHIHUWR
DUHDOLVWLFµ(FRUU¶IRUVWHHOLQDQDTXHRXVVROXWLRQZLWKORZSRWHQWLDOWKDWFRP DUHDOLVWLFµ(FRUU¶IRUVWHHOLQDQDTXHRXVVROXWLRQZLWKORZSRWHQWLDOWKDWFRP
SDUHV WR DQ DYHUDJH µ(FRUU¶ RI VWHHO LQ XQFRQWDPLQDWHG FRQFUHWH LH DURXQG SDUHV WR DQ DYHUDJH µ(FRUU¶ RI VWHHO LQ XQFRQWDPLQDWHG FRQFUHWH LH DURXQG

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


(OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

P96+(,IDQDHUDWHGVROXWLRQZLWKWKHVDPHS+KDGEHHQFRQVLGHUHGLQVWHDG P96+(,IDQDHUDWHGVROXWLRQZLWKWKHVDPHS+KDGEHHQFRQVLGHUHGLQVWHDG
RI RUJDQLF ULFK ODNH ZDWHU WKH GULYLQJ IRUFH IRU DFWLYH FRUURVLRQ ZRXOG KDYH RI RUJDQLF ULFK ODNH ZDWHU WKH GULYLQJ IRUFH IRU DFWLYH FRUURVLRQ ZRXOG KDYH
EHHQPXFKKLJKHU EHHQPXFKKLJKHU
0RUHRYHUWDNLQJLQWRDFFRXQWWKDWSRODULVDWLRQFXUYHVDUHOLPLWHGWRDFHUWDLQ 0RUHRYHUWDNLQJLQWRDFFRXQWWKDWSRODULVDWLRQFXUYHVDUHOLPLWHGWRDFHUWDLQ
S+YDOXHZHFRQVLGHUWKHLPPHGLDWHSUHVHQWDWLRQRIWKHS+GHSHQGHQFLHVRI S+YDOXHZHFRQVLGHUWKHLPPHGLDWHSUHVHQWDWLRQRIWKHS+GHSHQGHQFLHVRI
WKHVH KDOIFHOO UHDFWLRQV LQ SDUWLFXODU IRU WKH PRVW LPSRUWDQW FDWKRGLF UHDF WKHVH KDOIFHOO UHDFWLRQV LQ SDUWLFXODU IRU WKH PRVW LPSRUWDQW FDWKRGLF UHDF
WLRQVLHR[\JHQDQGK\GURJHQLRQUHGXFWLRQWREHDEHQHILFLDODVSHFWLQWKH WLRQVLHR[\JHQDQGK\GURJHQLRQUHGXFWLRQWREHDEHQHILFLDODVSHFWLQWKH
3RXUEDL[ GLDJUDP FI )LJXUH   +RZHYHU WKH HTXLOLEULXP SRWHQWLDOV RI 3RXUEDL[ GLDJUDP FI )LJXUH   +RZHYHU WKH HTXLOLEULXP SRWHQWLDOV RI
>@DQG>@DUHGHSHQGHQWRQWKHDVVXPHGLURQLRQDFWLYLW\ >@DQG>@DUHGHSHQGHQWRQWKHDVVXPHGLURQLRQDFWLYLW\
ƕ 7KHPDJQLWXGHRIµ(F¶LVFRQWUROOHGE\WKHDYDLODELOLW\RIR[\JHQ ƕ 7KHPDJQLWXGHRIµ(F¶LVFRQWUROOHGE\WKHDYDLODELOLW\RIR[\JHQ
:LWKGHFUHDVLQJR[\JHQDYDLODELOLW\µ(F¶GHFUHDVHVDQGKHQFHWKHDQRGLFSR :LWKGHFUHDVLQJR[\JHQDYDLODELOLW\µ(F¶GHFUHDVHVDQGKHQFHWKHDQRGLFSR
ODULVDWLRQDQGZLWKWKDWWKHR[LGDWLRQSRZHURUFRUURVLRQWHQGHQF\RIWKHV\V ODULVDWLRQDQGZLWKWKDWWKHR[LGDWLRQSRZHURUFRUURVLRQWHQGHQF\RIWKHV\V
WHPJRHVGRZQDQGYLFHYHUVD7KLVQRWLRQFDQDOVREHFRPSUHKHQVLEO\LOOXV WHPJRHVGRZQDQGYLFHYHUVD7KLVQRWLRQFDQDOVREHFRPSUHKHQVLEO\LOOXV
WUDWHGE\PHDQVRISRODULVDWLRQFXUYHVDVHJVKRZQLQ6HFWLRQ<HWLW WUDWHGE\PHDQVRISRODULVDWLRQFXUYHVDVHJVKRZQLQ6HFWLRQ<HWLW
FDQ DOVR EH WKHUPRG\QDPLFDOO\ DFFHVVHG E\ HJ H[SUHVVLQJ WKH 1HUQVW HTXD FDQ DOVR EH WKHUPRG\QDPLFDOO\ DFFHVVHG E\ HJ H[SUHVVLQJ WKH 1HUQVW HTXD
WLRQGHVFULELQJWKHR[\JHQHTXLOLEULXPOLQH FI6HFWLRQ DVDIXQFWLRQ WLRQGHVFULELQJWKHR[\JHQHTXLOLEULXPOLQH FI6HFWLRQ  DV DIXQFWLRQ
RIWKHS+DQGWKHSDUWLDOR[\JHQSUHVVXUHµS2¶ RIWKHS+DQGWKHSDUWLDOR[\JHQSUHVVXUHµS2¶

  ( )
( 2  +2 =  −  × S+ +  × ORJ S 2  >@   ( )
( 2  +2 =  −  × S+ +  × ORJ S 2  >@

$VPHQWLRQHGµS2¶ EDUUHSUHVHQWVVWDQGDUGFRQGLWLRQVDQGLWLVREYLRXV $VPHQWLRQHGµS2¶ EDUUHSUHVHQWVVWDQGDUGFRQGLWLRQVDQGLWLVREYLRXV


IURP>@WKDWµ(F¶GHFUHDVHVZLWKGHFUHDVLQJµS2¶DQGYLFHYHUVD IURP>@WKDWµ(F¶GHFUHDVHVZLWKGHFUHDVLQJµS2¶DQGYLFHYHUVD
‡ 'HYHORSPHQWDQGPDJQLWXGHRIµ(FRUU¶LQWKHSDVVLYHVWDWH ‡ 'HYHORSPHQWDQGPDJQLWXGHRIµ(FRUU¶LQWKHSDVVLYHVWDWH
$V ORQJ DV WKH VWHHO LV LQ WKH SDVVLYH VWDWH ZH FRQVLGHU WKH IROORZLQJ WR EH WUXH $V ORQJ DV WKH VWHHO LV LQ WKH SDVVLYH VWDWH ZH FRQVLGHU WKH IROORZLQJ WR EH WUXH
ZLWKUHJDUGWRWKHGHYHORSPHQWDQGPDJQLWXGHRIµ(FRUU¶ ZLWKUHJDUGWRWKHGHYHORSPHQWDQGPDJQLWXGHRIµ(FRUU¶
ƕ µ(FRUU¶LVGRPLQDWHGE\WKHFDWKRGLFSURFHVV7KLVLVGXHWRWKHDQRGLFSURFHVV ƕ µ(FRUU¶LVGRPLQDWHGE\WKHFDWKRGLFSURFHVV7KLVLVGXHWRWKHDQRGLFSURFHVV
EHLQJ KDPSHUHG E\ WKH SDVVLYH OD\HU ZKHUHDV WKH FDWKRGLF SURFHVV FDQ WDNH EHLQJ KDPSHUHG E\ WKH SDVVLYH OD\HU ZKHUHDV WKH FDWKRGLF SURFHVV FDQ WDNH
SODFHRQWKHVXUIDFHRIWKHSDVVLYHOD\HU WKHSDVVLYHOD\HURIVWHHOLVHOHFWURQ SODFHRQWKHVXUIDFHRIWKHSDVVLYHOD\HU WKHSDVVLYHOD\HURIVWHHOLVHOHFWURQ
FRQGXFWLQJEXWQRWLRQFRQGXFWLQJFI6HFWLRQ  FRQGXFWLQJEXWQRWLRQFRQGXFWLQJFI6HFWLRQ 
ƕ ,Q FRQWUDVW WR VRPH OLWHUDWXUH ZH FRQVLGHU WKH IRUPDWLRQ RI SURGXFWV LQ DOO ƕ ,Q FRQWUDVW WR VRPH OLWHUDWXUH ZH FRQVLGHU WKH IRUPDWLRQ RI SURGXFWV LQ DOO
VWDWHVWREH³GLUHFW´DQGWKHSURGXFWWREHGHWHUPLQHGE\WKHDVVRFLDWHGWKHU VWDWHVWREH³GLUHFW´DQGWKHSURGXFWWREHGHWHUPLQHGE\WKHDVVRFLDWHGWKHU
PRG\QDPLFDOO\IDYRXUHGDQRGLFUHDFWLRQ)RUWKHSDVVLYHVWDWHWKDWPHDQVIRU PRG\QDPLFDOO\IDYRXUHGDQRGLFUHDFWLRQ)RUWKHSDVVLYHVWDWHWKDWPHDQVIRU
LQVWDQFHWKDWIRUPDWLRQRIKHPDWLWHDVGHVFULEHGE\>@LQYROYHVQRLQWHU LQVWDQFHWKDWIRUPDWLRQRIKHPDWLWHDVGHVFULEHGE\>@LQYROYHVQRLQWHU
PHGLDWHVWHSV ,IDVXIILFLHQW DPRXQW RI R[\JHQ LV DYDLODEOH DQG WKH FDWKRGLF PHGLDWHVWHSV ,IDVXIILFLHQW DPRXQW RI R[\JHQ LV DYDLODEOH DQG WKH FDWKRGLF
SURFHVV ³PRYHV´ µ(FRUU¶ LQ WKH WKHUPRG\QDPLF VWDELOLW\ GRPDLQ RI )H2 SURFHVV ³PRYHV´ µ(FRUU¶ LQ WKH WKHUPRG\QDPLF VWDELOLW\ GRPDLQ RI )H2
KHPDWLWHLVGLUHFWO\ IRUPHGLQWKHSUHVHQFHRIZDWHU FI )LJXUHDQGKDOI KHPDWLWHLVGLUHFWO\ IRUPHGLQWKHSUHVHQFHRIZDWHU FI )LJXUHDQGKDOI
FHOO UHDFWLRQ >@  :LWK ORZHU R[\JHQ FRQWHQW DQG FRQVHTXHQWO\ ORZHU FHOO UHDFWLRQ >@  :LWK ORZHU R[\JHQ FRQWHQW DQG FRQVHTXHQWO\ ORZHU
µ(FRUU¶IRUPDWLRQRI)H2RU+)H2íFDQEHIDYRXUHGZKLFKLVGHDOWZLWKLQ µ(FRUU¶IRUPDWLRQRI)H2RU+)H2íFDQEHIDYRXUHGZKLFKLVGHDOWZLWKLQ
6HFWLRQVDQGUHVSHFWLYHO\ 6HFWLRQVDQGUHVSHFWLYHO\

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH

ƕ *LYHQWKDWWKHVWHHOUHPDLQVSDVVLYHµ(FRUU¶LQFUHDVHVZLWKGHFUHDVLQJDONDOLQ ƕ *LYHQWKDWWKHVWHHOUHPDLQVSDVVLYHµ(FRUU¶LQFUHDVHVZLWKGHFUHDVLQJDONDOLQ
LW\RIWKHFRQFUHWHDQGYLFHYHUVDZKLFKLVGXHWRµ(F¶LQFUHDVLQJZLWK GH LW\RIWKHFRQFUHWHDQGYLFHYHUVDZKLFKLVGXHWRµ(F¶LQFUHDVLQJZLWK GH
FUHDVLQJDONDOLQLW\ FIHTXDWLRQ>@DQGWKHVORSHRIWKHR[\JHQHTXLOLEULXP FUHDVLQJDONDOLQLW\ FIHTXDWLRQ>@DQGWKHVORSHRIWKHR[\JHQHTXLOLEULXP
OLQHLQ)LJXUH  OLQHLQ)LJXUH 
‡ 'HYHORSPHQWDQGPDJQLWXGHRIµ(FRUU¶LQWKHDFWLYHFRUURVLRQVWDWH ‡ 'HYHORSPHQWDQGPDJQLWXGHRIµ(FRUU¶LQWKHDFWLYHFRUURVLRQVWDWH
:LWKLQLWLDWLRQRIDFWLYHFRUURVLRQRUFRUURVLRQSURSDJDWLRQZHHPSKDVLVHWKHIRO :LWKLQLWLDWLRQRIDFWLYHFRUURVLRQRUFRUURVLRQSURSDJDWLRQZHHPSKDVLVHWKHIRO
ORZLQJZLWKUHJDUGWRWKHGHYHORSPHQWDQGPDJQLWXGHRIµ(FRUU¶ ORZLQJZLWKUHJDUGWRWKHGHYHORSPHQWDQGPDJQLWXGHRIµ(FRUU¶
ƕ 7KHRIWHQFLWHG GURSRIµ(FRUU¶ZLWKFRUURVLRQLQLWLDWLRQFRPPRQO\UHIHUUHGWR ƕ 7KHRIWHQFLWHG GURSRIµ(FRUU¶ZLWKFRUURVLRQLQLWLDWLRQFRPPRQO\UHIHUUHGWR
DV SRWHQWLDO GURS LV QRW GXH WR WKH FKDQJH RI µ(F¶ ZLWK IRUPDWLRQ RI RWKHU DV SRWHQWLDO GURS LV QRW GXH WR WKH FKDQJH RI µ(F¶ ZLWK IRUPDWLRQ RI RWKHU
SURGXFWV)RULQVWDQFHWKHµ(D¶YDOXHVDWS+DQGS+ SURGXFWV)RULQVWDQFHWKHµ(D¶YDOXHVDWS+DQGS+

 
)H → )H+ + H− (( 
 = −  {} P96+( ) >@  
)H → )H+ + H− (( 
 = −  {} P96+( ) >@
(  ( S+  ) = −  P96+( (  ( S+  ) = −  P96+(

 
)H + +  2 → )H 2 + + + + H − (( 
 = −  P96+( ) >@  
)H + +  2 → )H 2 + + + + H − (( 
 = −  P96+( ) >@
(  ( S+ ) = −  P96+( (  ( S+ ) = −  P96+(

VKRZWKDWµ(D¶LVDFWXDOO\ORZHULQWKHSDVVLYHVWDWH7KHSRWHQWLDOGURSLVDOVR VKRZWKDWµ(D¶LVDFWXDOO\ORZHULQWKHSDVVLYHVWDWH7KHSRWHQWLDOGURSLVDOVR
QRWGXHWRDGHFUHDVHLQµ(F¶ZKLFKDFWXDOO\LVORZHULQDONDOLQHFRQFUHWHLH QRWGXHWRDGHFUHDVHLQµ(F¶ZKLFKDFWXDOO\LVORZHULQDONDOLQHFRQFUHWHLH
LQ WKH SDVVLYH VWDWH FI %XOOHW ³'HYHORSPHQW DQG PDJQLWXGH RI µ(FRUU¶ LQ WKH LQ WKH SDVVLYH VWDWH FI %XOOHW ³'HYHORSPHQW DQG PDJQLWXGH RI µ(FRUU¶ LQ WKH
SDVVLYHVWDWH´  SDVVLYHVWDWH´ 
ƕ :LWKFRUURVLRQLQLWLDWLRQWKHSDVVLYHOD\HULVEURNHQGRZQDQGWKXVWKHGHSDV ƕ :LWKFRUURVLRQLQLWLDWLRQWKHSDVVLYHOD\HULVEURNHQGRZQDQGWKXVWKHGHSDV
VLYDWHGVWHHOVXUIDFHLVERWKHOHFWURQDQGLRQFRQGXFWLQJ FI6HFWLRQ VR VLYDWHGVWHHOVXUIDFHLVERWKHOHFWURQDQGLRQFRQGXFWLQJ FI6HFWLRQ VR
WKDWWKHDQRGLFUHDFWLRQLVXQKDPSHUHGDQGWDNHVDODUJHUFRQWULEXWLRQLQWKH WKDWWKHDQRGLFUHDFWLRQLVXQKDPSHUHGDQGWDNHVDODUJHUFRQWULEXWLRQLQWKH
GHYHORSPHQWRIµ(FRUU¶7KDWPHDQVDPRUHDFWLYHDQRGLFSURFHVVORZHUVµ(FRUU¶ GHYHORSPHQWRIµ(FRUU¶7KDWPHDQVDPRUHDFWLYHDQRGLFSURFHVVORZHUVµ(FRUU¶
DQGYLFHYHUVD FI)LJXUHLQ6HFWLRQ :HWKLQNWKDWWKLVQRWLRQLV DQGYLFHYHUVD FI)LJXUHLQ6HFWLRQ :HWKLQNWKDWWKLVQRWLRQLV
WKHUPRG\QDPLFDOO\FRKHUHQWZLWKPHDVXULQJKLJKHUFRUURVLRQSRWHQWLDOVLQWKH WKHUPRG\QDPLFDOO\FRKHUHQWZLWKPHDVXULQJKLJKHUFRUURVLRQSRWHQWLDOVLQWKH
SDVVLYHVWDWHWKDQLQWKHDFWLYHVWDWHJLYHQWKDWWKHDYDLODELOLW\RIR[\JHQLVWKH SDVVLYHVWDWHWKDQLQWKHDFWLYHVWDWHJLYHQWKDWWKHDYDLODELOLW\RIR[\JHQLVWKH
VDPHLQERWKVWDWHV VDPHLQERWKVWDWHV
:HUHJDUGWKHVHDVSHFWVWREHFHQWUDOLQXQGHUVWDQGLQJWKHIXQGDPHQWDOSULQFLSOHVRI :HUHJDUGWKHVHDVSHFWVWREHFHQWUDOLQXQGHUVWDQGLQJWKHIXQGDPHQWDOSULQFLSOHVRI
WKH WKHUPRG\QDPLFV RI UHLQIRUFHPHQW FRUURVLRQ ,Q FRQFOXVLRQ WKH DERYH FDQ EH WKH WKHUPRG\QDPLFV RI UHLQIRUFHPHQW FRUURVLRQ ,Q FRQFOXVLRQ WKH DERYH FDQ EH
VXPPDULVHGDVIROORZV VXPPDULVHGDVIROORZV
µ(FRUU¶LVGHWHUPLQHGDVWKHPL[HGSRWHQWLDOEHWZHHQµ(D¶DQGµ(F¶µ(D¶GHSHQGV µ(FRUU¶LVGHWHUPLQHGDVWKHPL[HGSRWHQWLDOEHWZHHQµ(D¶DQGµ(F¶µ(D¶GHSHQGV
RQWKHSURGXFWVIRUPHGE\WKHDQRGLFUHDFWLRQDQGLWLVRQO\VOLJKWO\LQIOXHQFHGE\WKH RQWKHSURGXFWVIRUPHGE\WKHDQRGLFUHDFWLRQDQGLWLVRQO\VOLJKWO\LQIOXHQFHGE\WKH
LURQ LRQ DFWLYLW\ DW WKH FRQFUHWH VWHHO LQWHUIDFH FI 6HFWLRQ   ZKHUHDV µ(F¶ LV LURQ LRQ DFWLYLW\ DW WKH FRQFUHWH VWHHO LQWHUIDFH FI 6HFWLRQ   ZKHUHDV µ(F¶ LV
GHSHQGHQWRQWKHR[\JHQDYDLODELOLW\7KHDQRGLFSURFHVVGHFUHDVHVµ(FRUU¶ZKLOHWKH GHSHQGHQWRQWKHR[\JHQDYDLODELOLW\7KHDQRGLFSURFHVVGHFUHDVHVµ(FRUU¶ZKLOHWKH
FDWKRGLF SURFHVV LQFUHDVHV µ(FRUU¶ DQG WKXV µ(FRUU¶ LQFUHDVHV ZLWK LQFUHDVLQJ R[\JHQ FDWKRGLF SURFHVV LQFUHDVHV µ(FRUU¶ DQG WKXV µ(FRUU¶ LQFUHDVHV ZLWK LQFUHDVLQJ R[\JHQ
DYDLODELOLW\ DQG YLFH YHUVD µ( F¶ LV GRPLQDQW LQ FRQWUROOLQJ µ(FRUU¶ LQ WKH SDVVLYH DYDLODELOLW\ DQG YLFH YHUVD µ( F¶ LV GRPLQDQW LQ FRQWUROOLQJ µ(FRUU¶ LQ WKH SDVVLYH
 

,QSDUWLFXODUZLWKUHJDUGWRSRWHQWLDOPRQLWRULQJPDSSLQJDVDQLQGLFDWLRQIRUFRUURVLRQLQLWLDWLRQ FI ,QSDUWLFXODUZLWKUHJDUGWRSRWHQWLDOPRQLWRULQJPDSSLQJDVDQLQGLFDWLRQIRUFRUURVLRQLQLWLDWLRQ FI
6HFWLRQ  6HFWLRQ 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


(OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

VWDWHEXWWKHFRQWULEXWLRQRIµ(D¶WRWKHGHYHORSPHQWRIµ(FRUU¶LQFUHDVHVZLWKGHSDV VWDWHEXWWKHFRQWULEXWLRQRIµ(D¶WRWKHGHYHORSPHQWRIµ(FRUU¶LQFUHDVHVZLWKGHSDV
VLYDWLRQZKLFKFDQEHPHDVXUHGDVDPRUHRUOHVVSURQRXQFHGGURSRIµ(FRUU¶ VLYDWLRQZKLFKFDQEHPHDVXUHGDVDPRUHRUOHVVSURQRXQFHGGURSRIµ(FRUU¶

 )XQGDPHQWDO&RUURVLRQ0HFKDQLVP  )XQGDPHQWDO&RUURVLRQ0HFKDQLVP


7DNLQJLQWRDFFRXQWWKHDERYHPHQWLRQHGDVSHFWVZHWKLQNWKDWDPRGLILHGFRQFHSWWR 7DNLQJLQWRDFFRXQWWKHDERYHPHQWLRQHGDVSHFWVZHWKLQNWKDWDPRGLILHGFRQFHSWWR
GHVFULEH WKH XQGHUO\LQJ SULQFLSOHV RI WKH HOHFWURFKHPLVWU\ RI VWHHO LQ FRQFUHWH LV UH GHVFULEH WKH XQGHUO\LQJ SULQFLSOHV RI WKH HOHFWURFKHPLVWU\ RI VWHHO LQ FRQFUHWH LV UH
TXLUHGWRHQDEOHDWKHUPRG\QDPLFXQGHUVWDQGLQJDQGKHQFHDFRQVLVWHQWGHVFULSWLRQRI TXLUHGWRHQDEOHDWKHUPRG\QDPLFXQGHUVWDQGLQJDQGKHQFHDFRQVLVWHQWGHVFULSWLRQRI
SURFHVVHVLQDFWLYHFRUURVLRQDQGSDVVLYLW\ SURFHVVHVLQDFWLYHFRUURVLRQDQGSDVVLYLW\
0DQ\ WH[WERRNV RQ UHLQIRUFHPHQW FRUURVLRQ LQWURGXFH FRUURVLRQ RI VWHHO LQ FRQFUHWH 0DQ\ WH[WERRNV RQ UHLQIRUFHPHQW FRUURVLRQ LQWURGXFH FRUURVLRQ RI VWHHO LQ FRQFUHWH
E\GLIIHUHQWYDULDWLRQVRIDVNHWFKLQGLFDWLQJD³FORVHGFLUFXLW´WKDWLQFOXGHVWKHGLVVR E\GLIIHUHQWYDULDWLRQVRIDVNHWFKLQGLFDWLQJD³FORVHGFLUFXLW´WKDWLQFOXGHVWKHGLVVR
OXWLRQRI)HWR)H>@DVWKHDQRGLFSURFHVVDQGWKHUHGXFWLRQRIR[\JHQLQWKHDO OXWLRQRI)HWR)H>@DVWKHDQRGLFSURFHVVDQGWKHUHGXFWLRQRIR[\JHQLQWKHDO
NDOLQHHQYLURQPHQW>@DVWKHFDWKRGLFSURFHVV7KHVHUHDFWLRQVIRUPDQHOHFWULFFLU NDOLQHHQYLURQPHQW>@DVWKHFDWKRGLFSURFHVV7KHVHUHDFWLRQVIRUPDQHOHFWULFFLU
FXLW DV WKH FRPELQDWLRQ RI WKH HOHFWURQLF FXUUHQW WKURXJK WKH UHLQIRUFHPHQW DQG WKH FXLW DV WKH FRPELQDWLRQ RI WKH HOHFWURQLF FXUUHQW WKURXJK WKH UHLQIRUFHPHQW DQG WKH
IORZRILRQLFFXUUHQWWKURXJKWKHFRQFUHWHEXONVHH)LJXUH IORZRILRQLFFXUUHQWWKURXJKWKHFRQFUHWHEXONVHH)LJXUH

 
)LJXUH 7UDGLWLRQDOIXQGDPHQWDOPHFKDQLVPIRUFRUURVLRQRIVWHHOLQFRQFUHWH )LJXUH 7UDGLWLRQDOIXQGDPHQWDOPHFKDQLVPIRUFRUURVLRQRIVWHHOLQFRQFUHWH
$IWHU>%URRPILHOG@7KLVPHFKDQLVPLVSURSRVHGWREHPRGLILHG $IWHU>%URRPILHOG@7KLVPHFKDQLVPLVSURSRVHGWREHPRGLILHG
VHH)LJXUH VHH)LJXUH
7KLVPHFKDQLVPLVRIWHQUHIHUUHGWRDVWKH³IXQGDPHQWDOPHFKDQLVP´IRUFRUURVLRQRI 7KLVPHFKDQLVPLVRIWHQUHIHUUHGWRDVWKH³IXQGDPHQWDOPHFKDQLVP´IRUFRUURVLRQRI
VWHHOLQFRQFUHWH'LVUHJDUGLQJWKHSRVVLEOHWKHUPRG\QDPLFLQFRQVLVWHQF\EHWZHHQWKH VWHHOLQFRQFUHWH'LVUHJDUGLQJWKHSRVVLEOHWKHUPRG\QDPLFLQFRQVLVWHQF\EHWZHHQWKH
DQRGLFDQGFDWKRGLFUHDFWLRQ FI6HFWLRQ ZHWKLQNWKDWWKLVLOOXVWUDWLRQGRHVQRW DQRGLFDQGFDWKRGLFUHDFWLRQ FI6HFWLRQ ZHWKLQNWKDWWKLVLOOXVWUDWLRQGRHVQRW
DGHTXDWHO\UHSUHVHQWWKHFRUURVLRQSURFHVVRIVWHHOLQFRQFUHWHVLQFHLWRQO\LQGLFDWHV DGHTXDWHO\UHSUHVHQWWKHFRUURVLRQSURFHVVRIVWHHOLQFRQFUHWHVLQFHLWRQO\LQGLFDWHV
RQHRIYDULRXVSRVVLEOHDQRGLFUHDFWLRQVWKDWGHWHUPLQHWKHDFWLYHDQGSDVVLYHVWDWHRI RQHRIYDULRXVSRVVLEOHDQRGLFUHDFWLRQVWKDWGHWHUPLQHWKHDFWLYHDQGSDVVLYHVWDWHRI
VWHHO LQ FRQFUHWH +RZHYHU LI WKLV GHVFULSWLRQ RI WKH ³IXQGDPHQWDO PHFKDQLVP´ LV VWHHO LQ FRQFUHWH +RZHYHU LI WKLV GHVFULSWLRQ RI WKH ³IXQGDPHQWDO PHFKDQLVP´ LV
PHDQWWRLQFOXGHIRUPDWLRQRIHJSDVVLYHLURQR[LGHVZHGLVDJUHHWRVXFKGHVFULS PHDQWWRLQFOXGHIRUPDWLRQRIHJSDVVLYHLURQR[LGHVZHGLVDJUHHWRVXFKGHVFULS
WLRQVLQFHZHFRQVLGHUSDVVLYHVSHFLHVWREHIRUPHGGLUHFWO\LQWKHSUHVHQFHRIZDWHU WLRQVLQFHZHFRQVLGHUSDVVLYHVSHFLHVWREHIRUPHGGLUHFWO\LQWKHSUHVHQFHRIZDWHU
DQGR[\JHQ FI6HFWLRQ )XUWKHUPRUHZHWKLQNWKDWLWLVLPSRUWDQWWRSRLQWRXW DQGR[\JHQ FI6HFWLRQ )XUWKHUPRUHZHWKLQNWKDWLWLVLPSRUWDQWWRSRLQWRXW
WKDWWKHFKDUDFWHURIWKHLRQLFFXUUHQWLVPLVLQWHUSUHWHGRURYHUVLPSOLILHGLQVXFKGH WKDWWKHFKDUDFWHURIWKHLRQLFFXUUHQWLVPLVLQWHUSUHWHGRURYHUVLPSOLILHGLQVXFKGH
VFULSWLRQ5HODWHGWRWKLVFRQFHSWRIWKH³IXQGDPHQWDOPHFKDQLVP´WKHHVWDEOLVKPHQW VFULSWLRQ5HODWHGWRWKLVFRQFHSWRIWKH³IXQGDPHQWDOPHFKDQLVP´WKHHVWDEOLVKPHQW
RI WKH LRQLF FXUUHQW LV RIWHQ GHVFULEHG DV WKH GLIIXVLRQ RI )H IURP WKH DQRGH WR WKH RI WKH LRQLF FXUUHQW LV RIWHQ GHVFULEHG DV WKH GLIIXVLRQ RI )H IURP WKH DQRGH WR WKH
FDWKRGHDQGGLIIXVLRQRI2+íYLFHYHUVDDQGWKHHOHFWULFDOQHXWUDOLW\LVSUHVHUYHGWKLV FDWKRGHDQGGLIIXVLRQRI2+íYLFHYHUVDDQGWKHHOHFWULFDOQHXWUDOLW\LVSUHVHUYHGWKLV
ZD\ FI6HFWLRQ  +RZHYHUEDVHGRQWKHWKHRU\RQWUDQVSRUW PHFKDQLVPV LQ ZD\ FI 6HFWLRQ   +RZHYHUEDVHG RQ WKH WKHRU\ RQ WUDQVSRUW PHFKDQLVPV LQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ (OHFWURFKHPLVWU\RI6WHHOLQ&RQFUHWH

JUHVVDQGLRQPRELOLW\LQFRQFUHWH FI6HFWLRQVDQG ZHDVVXPHWKDWDOO JUHVVDQGLRQPRELOLW\LQFRQFUHWH FI6HFWLRQVDQG ZHDVVXPHWKDWDOO


LRQVSUHVHQWLQWKHFRQFUHWHSRUHVROXWLRQFDQGLVFKDUJHWKHFDWLRQVDQGDQLRQVIRUPHG LRQVSUHVHQWLQWKHFRQFUHWHSRUHVROXWLRQFDQGLVFKDUJHWKHFDWLRQVDQGDQLRQVIRUPHG
DW WKH DQRGLF DQG FDWKRGLF VLWHV UHVSHFWLYHO\ DQG WKXV FRQWULEXWH LQ SUHVHUYLQJ WKH DW WKH DQRGLF DQG FDWKRGLF VLWHV UHVSHFWLYHO\ DQG WKXV FRQWULEXWH LQ SUHVHUYLQJ WKH
HOHFWULFDOQHXWUDOLW\$SDUWIURPEHLQJWKHUPRG\QDPLFDOO\FRQVLVWHQWZLWKWKHIRUPD HOHFWULFDOQHXWUDOLW\$SDUWIURPEHLQJWKHUPRG\QDPLFDOO\FRQVLVWHQWZLWKWKHIRUPD
WLRQRIWKHSDVVLYHOD\HUWKLVFRQFHSWRIWKHLRQLFFXUUHQWLVDOVRDFFRXQWLQJIRUPDF WLRQRIWKHSDVVLYHOD\HUWKLVFRQFHSWRIWKHLRQLFFXUUHQWLVDOVRDFFRXQWLQJIRUPDF
URFHOOIRUPDWLRQ FI6HFWLRQ ZKHUHHJ)HGLIIXVHVDZD\IURPWKHUHLQIRUFH URFHOOIRUPDWLRQ FI6HFWLRQ ZKHUHHJ)HGLIIXVHVDZD\IURPWKHUHLQIRUFH
PHQWDQGGRHVQRWQHFHVVDULO\SUHFLSLWDWHLPPHGLDWHO\ FI6HFWLRQ 7KHWUDGL PHQWDQGGRHVQRWQHFHVVDULO\SUHFLSLWDWHLPPHGLDWHO\ FI6HFWLRQ 7KHWUDGL
WLRQDOIXQGDPHQWDOPHFKDQLVPGRHVQRWDFFRXQWIRUWKHVHDVSHFWV:HXQGHUVWDQGWKLV WLRQDOIXQGDPHQWDOPHFKDQLVPGRHVQRWDFFRXQWIRUWKHVHDVSHFWV:HXQGHUVWDQGWKLV
GHVFULSWLRQ WR EH OLPLWHG WR FDUERQDWLRQ LQGXFHG FRUURVLRQ DQG WKLQN WKDW LW QHLWKHU GHVFULSWLRQ WR EH OLPLWHG WR FDUERQDWLRQ LQGXFHG FRUURVLRQ DQG WKLQN WKDW LW QHLWKHU
FRYHUV SDVVLYLW\ QRU DFWLYH PDFURFHOO FRUURVLRQ DQG WKH RIWHQ LI QRW DOZD\V  UHODWHG FRYHUV SDVVLYLW\ QRU DFWLYH PDFURFHOO FRUURVLRQ DQG WKH RIWHQ LI QRW DOZD\V  UHODWHG
FKORULGHLQGXFHGFRUURVLRQ:LWKUHJDUGWRFKORULGHLQGXFHGFRUURVLRQLWVKRXOGDOVR FKORULGHLQGXFHGFRUURVLRQ:LWKUHJDUGWRFKORULGHLQGXFHGFRUURVLRQLWVKRXOGDOVR
EH QRWHG WKDW IRUPDWLRQ RI LURQFKORULGH FRPSOH[HV ZKLFK ZH DVVXPH WR EH ODUJHO\ EH QRWHG WKDW IRUPDWLRQ RI LURQFKORULGH FRPSOH[HV ZKLFK ZH DVVXPH WR EH ODUJHO\
IDYRXUHGXQGHUWKLVFRQGLWLRQDUHQRWWDNHQLQWRDFFRXQWLQWKHWUDGLWLRQDOGHVFULSWLRQ IDYRXUHGXQGHUWKLVFRQGLWLRQDUHQRWWDNHQLQWRDFFRXQWLQWKHWUDGLWLRQDOGHVFULSWLRQ
%DVHGRQWKHDERYHDQGWKHVWDWHPHQWVLQ6HFWLRQDQGZHSURSRVHDPRGL %DVHGRQWKHDERYHDQGWKHVWDWHPHQWVLQ6HFWLRQDQGZHSURSRVHDPRGL
ILHGFRQFHSWIRUWKHGHVFULSWLRQRIWKH³IXQGDPHQWDOPHFKDQLVP´WKDWDFFRXQWVIRUDOO ILHGFRQFHSWIRUWKHGHVFULSWLRQRIWKH³IXQGDPHQWDOPHFKDQLVP´WKDWDFFRXQWVIRUDOO
VWDWHVDQGFDXVHVIRUDFWLYHFRUURVLRQDQGSDVVLYLW\RIVWHHOLQFRQFUHWHDVVKRZQLQ VWDWHVDQGFDXVHVIRUDFWLYHFRUURVLRQDQGSDVVLYLW\RIVWHHOLQFRQFUHWHDVVKRZQLQ
)LJXUH )LJXUH

 
)LJXUH 3URSRVHGIXQGDPHQWDOPHFKDQLVPIRUSDVVLYHDQGDFWLYHFRUURVLRQRI )LJXUH 3URSRVHGIXQGDPHQWDOPHFKDQLVPIRUSDVVLYHDQGDFWLYHFRUURVLRQRI
VWHHOLQFRQFUHWH VWHHOLQFRQFUHWH
$VPHQWLRQHGLQ6HFWLRQZHGRQRWWKLQNWKDWLWLVUHDVRQDEOHWRDVVLJQDFHU $VPHQWLRQHGLQ6HFWLRQZHGRQRWWKLQNWKDWLWLVUHDVRQDEOHWRDVVLJQDFHU
WDLQGLUHFWLRQWRWKH³IORZ´RILRQLFFXUUHQW+RZHYHUIRUWKHGLUHFWLRQRIHOHFWURQLF WDLQGLUHFWLRQWRWKH³IORZ´RILRQLFFXUUHQW+RZHYHUIRUWKHGLUHFWLRQRIHOHFWURQLF
FXUUHQW ZH SUHIHU FRQWUDU\ WR PRVW OLWHUDWXUH WKH FRQFHSW WKDW WKH HOHFWURQLF FXUUHQW FXUUHQW ZH SUHIHU FRQWUDU\ WR PRVW OLWHUDWXUH WKH FRQFHSW WKDW WKH HOHFWURQLF FXUUHQW
³IORZV´IURPWKHDQRGHWRWKHFDWKRGHEHFDXVHZHFRQVLGHUWKLVFRQFHSWWREHLQEHW ³IORZV´IURPWKHDQRGHWRWKHFDWKRGHEHFDXVHZHFRQVLGHUWKLVFRQFHSWWREHLQEHW
WHUDJUHHPHQWZLWKWKHUHOHDVHRIHOHFWURQVZLWKLQWKHUHLQIRUFHPHQWDWWKHDQRGLFVLWH WHUDJUHHPHQWZLWKWKHUHOHDVHRIHOHFWURQVZLWKLQWKHUHLQIRUFHPHQWDWWKHDQRGLFVLWH
DQGWKHFRQVXPSWLRQRIHOHFWURQVIURPWKHUHLQIRUFHPHQWDWFDWKRGLFVLWHV DQGWKHFRQVXPSWLRQRIHOHFWURQVIURPWKHUHLQIRUFHPHQWDWFDWKRGLFVLWHV
7KH SURSRVHG PHFKDQLVP DQG WKH XQGHUO\LQJ WKHRU\ GHVFULEHG WKURXJKRXW 6HFWLRQV 7KH SURSRVHG PHFKDQLVP DQG WKH XQGHUO\LQJ WKHRU\ GHVFULEHG WKURXJKRXW 6HFWLRQV
DQGLVDSSOLHGIRUDLQRXURSLQLRQWKHUPRG\QDPLFDOO\FRQVLVWHQWGHVFULS DQGLVDSSOLHGIRUDLQRXURSLQLRQWKHUPRG\QDPLFDOO\FRQVLVWHQWGHVFULS

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

WLRQRIGLIIHUHQWVWDWHVRIDFWLYHFRUURVLRQDQGSDVVLYLW\IRUFDUERQVWHHOLQFRQFUHWHLQ WLRQRIGLIIHUHQWVWDWHVRIDFWLYHFRUURVLRQDQGSDVVLYLW\IRUFDUERQVWHHOLQFRQFUHWHLQ
6HFWLRQWKDWGHYLDWHVWRTXLWHVRPHH[WHQWIURPWKHH[LVWLQJGHVFULSWLRQVRIUHLQ 6HFWLRQWKDWGHYLDWHVWRTXLWHVRPHH[WHQWIURPWKHH[LVWLQJGHVFULSWLRQVRIUHLQ
IRUFHPHQWFRUURVLRQ IRUFHPHQWFRUURVLRQ

 5HDFWLRQ0HFKDQLVPV  5HDFWLRQ0HFKDQLVPV


,QWKLV6HFWLRQWKHWKHRU\IRUDWKHUPRG\QDPLFDOO\FRQVLVWHQWGHVFULSWLRQRIWKHHOHF ,QWKLV6HFWLRQWKHWKHRU\IRUDWKHUPRG\QDPLFDOO\FRQVLVWHQWGHVFULSWLRQRIWKHHOHF
WURFKHPLVWU\RIUHLQIRUFHPHQWFRUURVLRQZKLFKZDVSURSRVHGDQGH[HPSOLILHGLQ6HF WURFKHPLVWU\RIUHLQIRUFHPHQWFRUURVLRQZKLFKZDVSURSRVHGDQGH[HPSOLILHGLQ6HF
WLRQLVDSSOLHGIRUWKHGHVFULSWLRQRIGLIIHUHQWFRQGLWLRQVLQWKHSDVVLYHVWDWH 6HF WLRQLVDSSOLHGIRUWKHGHVFULSWLRQRIGLIIHUHQWFRQGLWLRQVLQWKHSDVVLYHVWDWH 6HF
WLRQ WKHDFWLYHFRUURVLRQVWDWH 6HFWLRQ DQGWKHLPPXQHVWDWH 6HFWLRQ WLRQ WKHDFWLYHFRUURVLRQVWDWH 6HFWLRQ DQGWKHLPPXQHVWDWH 6HFWLRQ
 E\UHDFWLRQPHFKDQLVPV$VPHQWLRQHGDSDUWIURPWKHIXQGDPHQWDOPHFKDQLVP  E\UHDFWLRQPHFKDQLVPV$VPHQWLRQHGDSDUWIURPWKHIXQGDPHQWDOPHFKDQLVP
IRUFRUURVLRQRIVWHHOLQFRQFUHWHUHDFWLRQPHFKDQLVPVDUHJHQHUDOO\QRWGHDOWZLWKLQ IRUFRUURVLRQRIVWHHOLQFRQFUHWHUHDFWLRQPHFKDQLVPVDUHJHQHUDOO\QRWGHDOWZLWKLQ
GHWDLOHYHQLQH[WHQVLYHWH[WERRNV6RPHFRPPRQFRUURVLRQFRQGLWLRQVKDYHEHHQGH GHWDLOHYHQLQH[WHQVLYHWH[WERRNV6RPHFRPPRQFRUURVLRQFRQGLWLRQVKDYHEHHQGH
VFULEHGE\UHDFWLRQPHFKDQLVPVLQRWKHUOLWHUDWXUHHJLQVFLHQWLILFSDSHUVRUWKHVHV VFULEHGE\UHDFWLRQPHFKDQLVPVLQRWKHUOLWHUDWXUHHJLQVFLHQWLILFSDSHUVRUWKHVHV
+RZHYHUEDVHGRQWKHWKHRU\GHVFULEHGLQ6HFWLRQHVSHFLDOO\ZLWKUHJDUGWRWKH +RZHYHUEDVHGRQWKHWKHRU\GHVFULEHGLQ6HFWLRQHVSHFLDOO\ZLWKUHJDUGWRWKH
WKHUPRG\QDPLFVLQYROYHGLQWKHIRUPDWLRQRIDQRGLFSURGXFWVDQGWKHUHODWHGFDWKRGLF WKHUPRG\QDPLFVLQYROYHGLQWKHIRUPDWLRQRIDQRGLFSURGXFWVDQGWKHUHODWHGFDWKRGLF
UHDFWLRQVZHFRQVLGHUVRPHRIWKHUHDFWLRQVSRVWXODWHGLQWKHOLWHUDWXUHWREHHUURQH UHDFWLRQVZHFRQVLGHUVRPHRIWKHUHDFWLRQVSRVWXODWHGLQWKHOLWHUDWXUHWREHHUURQH
RXVRULQFRQVLVWHQWRQDWKHUPRG\QDPLFEDVLV2WKHUFRUURVLRQFRQGLWLRQVHVSHFLDOO\ RXVRULQFRQVLVWHQWRQDWKHUPRG\QDPLFEDVLV2WKHUFRUURVLRQFRQGLWLRQVHVSHFLDOO\
SURSDJDWLRQ RI FKORULGH LQGXFHG FRUURVLRQ KDYH QRW EHHQ GHVFULEHG LQ GHWDLO ,Q WKH SURSDJDWLRQ RI FKORULGH LQGXFHG FRUURVLRQ KDYH QRW EHHQ GHVFULEHG LQ GHWDLO ,Q WKH
IROORZLQJ6HFWLRQVDOWHUQDWLYHRUQHZUHDFWLRQPHFKDQLVPVDUHSURSRVHGIRUWKHGLI IROORZLQJ6HFWLRQVDOWHUQDWLYHRUQHZUHDFWLRQPHFKDQLVPVDUHSURSRVHGIRUWKHGLI
IHUHQW VWDWHV DQG FRQGLWLRQV RIDFWLYHFRUURVLRQDQGSDVVLYLW\ RIFDUERQVWHHOLQFRQ IHUHQW VWDWHV DQG FRQGLWLRQV RIDFWLYHFRUURVLRQDQGSDVVLYLW\ RIFDUERQVWHHOLQFRQ
FUHWH ,Q DGGLWLRQ WR WKDW WKH PRVW LPSRUWDQW IDFWRUV FRQFHUQLQJ WKH GLIIHUHQW VWDWHV FUHWH ,Q DGGLWLRQ WR WKDW WKH PRVW LPSRUWDQW IDFWRUV FRQFHUQLQJ WKH GLIIHUHQW VWDWHV
DQGRUFRQGLWLRQVDUHEULHIO\VXPPDULVHG DQGRUFRQGLWLRQVDUHEULHIO\VXPPDULVHG

 3DVVLYH6WDWH  3DVVLYH6WDWH


,QWKLV6HFWLRQWZRFRQGLWLRQVSDVVLYLW\ 6HFWLRQ DQGORZSRWHQWLDOFRUURVLRQ ,QWKLV6HFWLRQWZRFRQGLWLRQVSDVVLYLW\ 6HFWLRQ DQGORZSRWHQWLDOFRUURVLRQ
6HFWLRQ   ZKLFK ZH FRQVLGHU WR EH UHOHYDQW LQ XQFRQWDPLQDWHG FRQFUHWH DUH 6HFWLRQ   ZKLFK ZH FRQVLGHU WR EH UHOHYDQW LQ XQFRQWDPLQDWHG FRQFUHWH DUH
GHVFULEHGRQDWKHUPRG\QDPLFEDVLV GHVFULEHGRQDWKHUPRG\QDPLFEDVLV

 3DVVLYLW\  3DVVLYLW\


,Q SULQFLSOH WKH SDVVLYH OD\HU RQ VWHHO LQ FRQFUHWH FDQ EH FRQVLGHUHG WR EH í WR ,Q SULQFLSOH WKH SDVVLYH OD\HU RQ VWHHO LQ FRQFUHWH FDQ EH FRQVLGHUHG WR EH í WR
í—PLQWKLFNQHVVDQGWRFRQVLVWPDLQO\RI)H2ZKLOHLWDOVRFRQVWLWXWHVVPDOOHU í—PLQWKLFNQHVVDQGWRFRQVLVWPDLQO\RI)H2ZKLOHLWDOVRFRQVWLWXWHVVPDOOHU
SRUWLRQVRI)H2DQGFHPHQWK\GUDWHV 7KLVGHILQLWLRQLVFRQVLGHUHGWREHVXIILFLHQW SRUWLRQVRI)H2DQGFHPHQWK\GUDWHV 7KLVGHILQLWLRQLVFRQVLGHUHGWREHVXIILFLHQW
IRUWKHSXUSRVHVRIWKLVWKHVLVEXWLWVKRXOGEHHPSKDVLVHGWKDWWKHFRPSRVLWLRQIRU IRUWKHSXUSRVHVRIWKLVWKHVLVEXWLWVKRXOGEHHPSKDVLVHGWKDWWKHFRPSRVLWLRQIRU
PDWLRQ DQG VWUXFWXUH RI WKH SDVVLYH OD\HU LV PXFK PRUH FRPSOH[ 7KHVH LVVXHV DUH PDWLRQ DQG VWUXFWXUH RI WKH SDVVLYH OD\HU LV PXFK PRUH FRPSOH[ 7KHVH LVVXHV DUH
JHQHUDOO\QRWGHDOWZLWKLQVWDQGDUGWH[WERRNVEXWUHIHUHQFHLVPDGHWRMRXUQDOSDSHUV JHQHUDOO\QRWGHDOWZLWKLQVWDQGDUGWH[WERRNVEXWUHIHUHQFHLVPDGHWRMRXUQDOSDSHUV
 

7KLVGHVFULSWLRQLVVLPSOLILHG,QWKHOLWHUDWXUHLWLVJHQHUDOO\GLVWLQJXLVKHGEHWZHHQGLIIHUHQWSKDVHV 7KLVGHVFULSWLRQLVVLPSOLILHG,QWKHOLWHUDWXUHLWLVJHQHUDOO\GLVWLQJXLVKHGEHWZHHQGLIIHUHQWSKDVHV
RI)H2HJKHPDWLWH Į)H2 DQGPDJKHPLWH Ȗ)H2 7KLVGLVWLQFWLRQLVRIPDUJLQDOLPSRU RI)H2HJKHPDWLWH Į)H2 DQGPDJKHPLWH Ȗ)H2 7KLVGLVWLQFWLRQLVRIPDUJLQDOLPSRU
WDQFHLQWKHSUHVHQWWKHVLVDQGDOOSKDVHVRI)H2DUHUHIHUUHGWRDVKHPDWLWH7KLVLVGXHWRWZRUHD WDQFHLQWKHSUHVHQWWKHVLVDQGDOOSKDVHVRI)H2DUHUHIHUUHGWRDVKHPDWLWH7KLVLVGXHWRWZRUHD
VRQV)LUVWO\ZHGRQRWWKLQNWKDWWKLVGLVWLQFWLRQLVUHTXLUHGZKHQHOHFWURFKHPLVWU\LVRIFRQFHUQ VRQV)LUVWO\ZHGRQRWWKLQNWKDWWKLVGLVWLQFWLRQLVUHTXLUHGZKHQHOHFWURFKHPLVWU\LVRIFRQFHUQ
DQGVHFRQGO\WKHUHLVQRGLVWLQFWLRQEHWZHHQWKHSKDVHVLQWKHDYDLODEOHWKHUPRG\QDPLFGDWD DQGVHFRQGO\WKHUHLVQRGLVWLQFWLRQEHWZHHQWKHSKDVHVLQWKHDYDLODEOHWKHUPRG\QDPLFGDWD

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV

HJ >$QGUDGH HWDO D 6DQGEHUJ  6DJRH&UHQWVLO  *ODVVHU  3RXU HJ >$QGUDGH HWDO D 6DQGEHUJ  6DJRH&UHQWVLO  *ODVVHU  3RXU
VDHH  +DQVVRQ @ (YLGHQFH IRU WKH H[LVWHQFH RI WKH SDVVLYH OD\HU RI VWHHO LQ VDHH  +DQVVRQ @ (YLGHQFH IRU WKH H[LVWHQFH RI WKH SDVVLYH OD\HU RI VWHHO LQ
FRQFUHWH LV LQGLUHFW DQG ODUJHO\ EDVHG RQ HOHFWURFKHPLFDO PHDVXUHPHQWV FI 6HFWLRQ FRQFUHWH LV LQGLUHFW DQG ODUJHO\ EDVHG RQ HOHFWURFKHPLFDO PHDVXUHPHQWV FI 6HFWLRQ
 ZKHUHDVLWVFRPSRVLWLRQLVFDQEHGLUHFWO\DVVHVVHGE\HJ5DPDQVSHFWURVFRS\  ZKHUHDVLWVFRPSRVLWLRQLVFDQEHGLUHFWO\DVVHVVHGE\HJ5DPDQVSHFWURVFRS\
>$QGRU@ >$QGRU@
7UDGLWLRQDOO\WKHUHDFWLRQVOHDGLQJWRWKHIRUPDWLRQRIWKHSDVVLYHOD\HUZHUHEHOLHYHG 7UDGLWLRQDOO\WKHUHDFWLRQVOHDGLQJWRWKHIRUPDWLRQRIWKHSDVVLYHOD\HUZHUHEHOLHYHG
WR EH TXLWH UDSLG DQG WR RFFXU GXULQJ WKH LQLWLDO VWDJHV RI FHPHQW K\GUDWLRQ HJ WR EH TXLWH UDSLG DQG WR RFFXU GXULQJ WKH LQLWLDO VWDJHV RI FHPHQW K\GUDWLRQ HJ
>6DJRH&UHQWVLO *ODVVHU@+RZHYHUPRUHUHFHQWSXEOLFDWLRQVVXJJHVWWKDWWKH >6DJRH&UHQWVLO *ODVVHU@+RZHYHUPRUHUHFHQWSXEOLFDWLRQVVXJJHVWWKDWWKH
IXOOGHYHORSPHQWRIWKHSDVVLYHOD\HULVRQO\DWWDLQHGDIWHUDSHULRGRIVHYHQGD\VRU IXOOGHYHORSPHQWRIWKHSDVVLYHOD\HULVRQO\DWWDLQHGDIWHUDSHULRGRIVHYHQGD\VRU
PRUH>3RXUVDHH +DQVVRQ@7KHUHLVDJHQHUDODJUHHPHQWWKDWWKHGULYLQJIRUFH PRUH>3RXUVDHH +DQVVRQ@7KHUHLVDJHQHUDODJUHHPHQWWKDWWKHGULYLQJIRUFH
IRUWKHUHDFWLRQVIRUPLQJWKHSDVVLYHOD\HUUHVXOWVIURPWKHSRWHQWLDOJUDGLHQWVDWWKH IRUWKHUHDFWLRQVIRUPLQJWKHSDVVLYHOD\HUUHVXOWVIURPWKHSRWHQWLDOJUDGLHQWVDWWKH
VWHHO VXUIDFH LQWURGXFHG E\ WKH VWHHO DV D KHWHURJHQHRXV PDWHULDO LWVHOI FI 6HFWLRQ VWHHO VXUIDFH LQWURGXFHG E\ WKH VWHHO DV D KHWHURJHQHRXV PDWHULDO LWVHOI FI 6HFWLRQ
 EXWHYHQPRUHE\WKHLQKRPRJHQHLW\RIWKHFRQFUHWHVWHHOLQWHUIDFHGXHWRWKH  EXWHYHQPRUHE\WKHLQKRPRJHQHLW\RIWKHFRQFUHWHVWHHOLQWHUIDFHGXHWRWKH
YRLGVDQGWKHRIWHQUHODWHGORFDOYDULDWLRQVLQPRLVWXUHFRQWHQWWKHDONDOLQLW\HWF FI YRLGVDQGWKHRIWHQUHODWHGORFDOYDULDWLRQVLQPRLVWXUHFRQWHQWWKHDONDOLQLW\HWF FI
6HFWLRQ ZKLFKGLYLGHWKHVWHHOLQWRVHYHUDODQRGLFDQGFDWKRGLFDUHDV7KHHIIHFW 6HFWLRQ ZKLFKGLYLGHWKHVWHHOLQWRVHYHUDODQRGLFDQGFDWKRGLFDUHDV7KHHIIHFW
RIWKHVHFRQGLWLRQVRQWKHLQLWLDWLRQRIDFWLYHFRUURVLRQLVGLVFXVVHGLQPRUHGHWDLOLQ RIWKHVHFRQGLWLRQVRQWKHLQLWLDWLRQRIDFWLYHFRUURVLRQLVGLVFXVVHGLQPRUHGHWDLOLQ
6HFWLRQ 6HFWLRQ
'HSHQGLQJRQWKHDYDLODELOLW\RIR[\JHQWKHFRUURVLRQSRWHQWLDOµ(FRUU¶RISDVVLYDWHG 'HSHQGLQJRQWKHDYDLODELOLW\RIR[\JHQWKHFRUURVLRQSRWHQWLDOµ(FRUU¶RISDVVLYDWHG
VWHHO LQ FRQFUHWH KDV EHHQ PHDVXUHG LQ D UDWKHU ZLGH UDQJH RI íP96+( WR  VWHHO LQ FRQFUHWH KDV EHHQ PHDVXUHG LQ D UDWKHU ZLGH UDQJH RI íP96+( WR 
P96+(>$UXS@EXWLVZLWKLQWKHWKHRUHWLFDOVWDELOLW\GRPDLQRIZDWHULQWKHS+ P96+(>$UXS@EXWLVZLWKLQWKHWKHRUHWLFDOVWDELOLW\GRPDLQRIZDWHULQWKHS+
UDQJH IURPDWOHDVWZKLFKZHUHJDUGDV DUHDVRQDEOHUDQJHIRUFRQVLGHUDWLRQV UDQJH IURPDWOHDVWZKLFKZHUHJDUGDV DUHDVRQDEOHUDQJHIRU FRQVLGHUDWLRQV
RQWKHSDVVLYHVWDWH RQWKHSDVVLYHVWDWH
+HQFHR[\JHQUHGXFWLRQLQWKHDONDOLQHHQYLURQPHQWFDQEHDVVXPHGWREHWKHGRPL +HQFHR[\JHQUHGXFWLRQLQWKHDONDOLQHHQYLURQPHQWFDQEHDVVXPHGWREHWKHGRPL
QDQWFDWKRGLFUHDFWLRQ FI6HFWLRQ  QDQWFDWKRGLFUHDFWLRQ FI6HFWLRQ 

2  + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@ 2  + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@

:H DVVXPH WKDW LQ WKH OLWHUDWXUH WKHUH LV D JHQHUDO DJUHHPHQW RQ WKH SUHYDOHQFH RI :H DVVXPH WKDW LQ WKH OLWHUDWXUH WKHUH LV D JHQHUDO DJUHHPHQW RQ WKH SUHYDOHQFH RI
WKLVFDWKRGLFUHDFWLRQEXWDSSDUHQWO\WKHUHDUHGLIIHUHQWFRQFHSWVUHJDUGLQJWKHDQRGLF WKLVFDWKRGLFUHDFWLRQEXWDSSDUHQWO\WKHUHDUHGLIIHUHQWFRQFHSWVUHJDUGLQJWKHDQRGLF
UHDFWLRQPHFKDQLVPWKDWOHDGVWRWKHIRUPDWLRQRIWKHSDVVLYHOD\HU7ZRH[DPSOHVDUH UHDFWLRQPHFKDQLVPWKDWOHDGVWRWKHIRUPDWLRQRIWKHSDVVLYHOD\HU7ZRH[DPSOHVDUH
JLYHQLQWKHEHORZ JLYHQLQWKHEHORZ
7KHIROORZLQJVHWRIDQRGLFUHDFWLRQVIRUIRUPDWLRQRI)H2DQG)H2GHSHQGLQJRQ 7KHIROORZLQJVHWRIDQRGLFUHDFWLRQVIRUIRUPDWLRQRI)H2DQG)H2GHSHQGLQJRQ
WKHR[\JHQDYDLODELOLW\LH)H2LVIDYRXUHGRYHU)H2 ZLWKORZR[\JHQDYDLODELO WKHR[\JHQDYDLODELOLW\LH)H2LVIDYRXUHGRYHU)H2 ZLWKORZR[\JHQDYDLODELO
LW\ZDVSURSRVHGLQ>6DQGEHUJ@ LW\ZDVSURSRVHGLQ>6DQGEHUJ@

)H + → )H+ + H− (( 
 = −  P96+( )  >@ )H + → )H+ + H− (( 
 = −  P96+( )  >@

2  + H − → 2 − (( 
 = −  P96+( )  >@ 2  + H − → 2 − (( 
 = −  P96+( )  >@

)H+ + 2 − → )H  2 ( Δ* 
= −  N- )  >@ )H+ + 2 − → )H  2 ( Δ* 
= −  N- )  >@

)H+ + )H+ + 2 − → )H2  ( Δ* 


= −  N- )  >@ )H+ + )H+ + 2 − → )H2  ( Δ* 
= −  N- )  >@

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

,Q>6DJRH&UHQWVLO *ODVVHU@WKHIROORZLQJVHWRIDQRGLFUHDFWLRQVLVSURSRVHG ,Q>6DJRH&UHQWVLO *ODVVHU@WKHIROORZLQJVHWRIDQRGLFUHDFWLRQVLVSURSRVHG


IRU WKH IRUPDWLRQ RI WKH SDVVLYH OD\HU GHSHQGLQJ RQ WKH H[LVWHQFH RI DQ DSSURSULDWH IRU WKH IRUPDWLRQ RI WKH SDVVLYH OD\HU GHSHQGLQJ RQ WKH H[LVWHQFH RI DQ DSSURSULDWH
HOHFWURFKHPLFDOSRWHQWLDO HOHFWURFKHPLFDOSRWHQWLDO

)H + +  2 → )H 2+  + + + + H − (( 
 = −  P96+( )  >@ )H + +  2 → )H 2+  + + + + H − (( 
 = −  P96+( )  >@

)H + +  2 → )H2  + + + + H − (( 
 = −  P96+( )  >@ )H + +  2 → )H2  + + + + H − (( 
 = −  P96+( )  >@

DQGDOWHUQDWLYHO\ DQGDOWHUQDWLYHO\

)H → )H + + H− (( 
 = −  {} P96+( )  >@ )H → )H + + H− (( 
 = −  {} P96+( )  >@

)H + +  2 → )H2 2+ − + + + + H − (( 
 =  P96+( )  >@ )H + +  2 → )H2 2+ − + + + + H − (( 
 =  P96+( )  >@

:HWKLQNWKDWWKHILUVWVHWRIDQRGLFUHDFWLRQV >@WR>@ GLVSOD\VVRPHPDMRU :HWKLQNWKDWWKHILUVWVHWRIDQRGLFUHDFWLRQV >@WR>@ GLVSOD\VVRPHPDMRU


WKHUPRG\QDPLF LQFRQVLVWHQFLHV ZLWK UHJDUG WR WKH FRQFUHWH HQYLURQPHQW 7KH UHGR[ WKHUPRG\QDPLF LQFRQVLVWHQFLHV ZLWK UHJDUG WR WKH FRQFUHWH HQYLURQPHQW 7KH UHGR[
UHDFWLRQV IRU WKH IRUPDWLRQ RI KHPDWLWH >@ DQG PDJQHWLWH >@ DUH WKHUPRG\ UHDFWLRQV IRU WKH IRUPDWLRQ RI KHPDWLWH >@ DQG PDJQHWLWH >@ DUH WKHUPRG\
QDPLFDOO\IDYRXUHG+RZHYHUWKHKDOIFHOOUHDFWLRQ>@ZKLFKIRUPVWKHQHFHVVDU\ QDPLFDOO\IDYRXUHG+RZHYHUWKHKDOIFHOOUHDFWLRQ>@ZKLFKIRUPVWKHQHFHVVDU\
UHDFWDQWLHWKHR[\JHQ ,, LRQIRUWKHVHUHDFWLRQVWRSURFHHGWDNHVSODFHDWDQµ(¶ UHDFWDQWLHWKHR[\JHQ ,, LRQIRUWKHVHUHDFWLRQVWRSURFHHGWDNHVSODFHDWDQµ(¶
RI±P96+(6XFKHTXLOLEULXPSRWHQWLDOVDUHQRWRQO\RXWRIUDQJHIRUSDVVLYHUH RI±P96+(6XFKHTXLOLEULXPSRWHQWLDOVDUHQRWRQO\RXWRIUDQJHIRUSDVVLYHUH
LQIRUFLQJVWHHOEXWJHQHUDOO\LPSRVVLEOHWREHDWWDLQHGLQWKHFRQFUHWHHQYLURQPHQW‚ LQIRUFLQJVWHHOEXWJHQHUDOO\LPSRVVLEOHWREHDWWDLQHGLQWKHFRQFUHWHHQYLURQPHQW‚
:HFRQVLGHUDOOUHDFWLRQVIURPWKHVHFRQGVHWRIDQRGLFUHDFWLRQV >@WR>@ WR :HFRQVLGHUDOOUHDFWLRQVIURPWKHVHFRQGVHWRIDQRGLFUHDFWLRQV >@WR>@ WR
EH WKHUPRG\QDPLFDOO\ SRVVLEOH LQ WKH FRQFUHWH HQYLURQPHQW EXW DSDUW IURP >@ EH WKHUPRG\QDPLFDOO\ SRVVLEOH LQ WKH FRQFUHWH HQYLURQPHQW EXW DSDUW IURP >@
ZKLFKLVWKHHTXLYDOHQWWRWKHHTXLOLEULXPOLQHEHWZHHQLURQDQGPDJQHWLWH FI6HFWLRQ ZKLFKLVWKHHTXLYDOHQWWRWKHHTXLOLEULXPOLQHEHWZHHQLURQDQGPDJQHWLWH FI6HFWLRQ
DQG)LJXUH>$@ ZHGRQRWWKLQNWKDWWKH\SOD\DUROHLQWKHIRUPDWLRQRI DQG)LJXUH>$@ ZHGRQRWWKLQNWKDWWKH\SOD\DUROHLQWKHIRUPDWLRQRI
WKHSDVVLYHOD\HU WKHSDVVLYHOD\HU
7KH VWDELOLW\ GRPDLQ RI )H 2+  SRVWXODWHG WR EH IRUPHG LQ >@ IDOOVPDLQO\ LQWR 7KH VWDELOLW\ GRPDLQ RI )H 2+  SRVWXODWHG WR EH IRUPHG LQ >@ IDOOVPDLQO\ LQWR
WKHVWDELOLW\GRPDLQRIPDJQHWLWH$FRPSDULVRQRIWKHµ¨*I¶RIERWKYDOXHVZKLFK WKHVWDELOLW\GRPDLQRIPDJQHWLWH$FRPSDULVRQRIWKHµ¨*I¶RIERWKYDOXHVZKLFK
ZHFRQVLGHUWREHGHFLVLYHLIERWKVSHFLHVDUHSRWHQWLDOO\IRUPHG FI6HFWLRQ  ZHFRQVLGHUWREHGHFLVLYHLIERWKVSHFLHVDUHSRWHQWLDOO\IRUPHG FI6HFWLRQ 
VKRZVWKDWIRUPDWLRQRI)H2 µ¨*I¶ íN-PRO LVIDYRXUHGDERYHIRUPDWLRQ VKRZVWKDWIRUPDWLRQRI)H2 µ¨*I¶ íN-PRO LVIDYRXUHGDERYHIRUPDWLRQ
RI)H 2+  µ¨*I¶ íN-PRO 0RUHRYHU )H2ZDVLGHQWLILHGWR FRQVWLWXWHWR RI)H 2+  µ¨*I¶ íN-PRO 0RUHRYHU )H2ZDVLGHQWLILHGWR FRQVWLWXWHWR
WKHSDVVLYHOD\HUZKHUHDVQRHYLGHQFHZDVIRXQGIRUIRUPDWLRQRI)H 2+ $FFRUG WKHSDVVLYHOD\HUZKHUHDVQRHYLGHQFHZDVIRXQGIRUIRUPDWLRQRI)H 2+ $FFRUG
LQJO\ZHDVVXPHWKDW)H 2+ GRHVQRWSOD\DFRQVLGHUDEOHUROHIRUVWHHOLQFRQFUHWH LQJO\ZHDVVXPHWKDW)H 2+ GRHVQRWSOD\DFRQVLGHUDEOHUROHIRUVWHHOLQFRQFUHWH
6LQFH DQ DOWHUQDWLYH 3RXUEDL[ GLDJUDP EDVHG RQ D SUHVHOHFWLRQ RI )H )H 2+  DQG 6LQFH DQ DOWHUQDWLYH 3RXUEDL[ GLDJUDP EDVHG RQ D SUHVHOHFWLRQ RI )H )H 2+  DQG
)H 2+  DV VROLG VSHFLHV LV SURSRVHG LQ >3RXUEDL[ E@ LW VKRXOG EH PHQWLRQHG )H 2+  DV VROLG VSHFLHV LV SURSRVHG LQ >3RXUEDL[ E@ LW VKRXOG EH PHQWLRQHG
KHUH WKDW ZH DOVR H[FOXGH )H 2+  IURP RXU FRQVLGHUDWLRQV IRU WKH VDPH UHDVRQV KHUH WKDW ZH DOVR H[FOXGH )H 2+  IURP RXU FRQVLGHUDWLRQV IRU WKH VDPH UHDVRQV
)H 2+  RFFXSLHV LQ SULQFLSOH WKH VDPH VWDELOLW\ GRPDLQ DV )H2 VHH )LJXUH  )H 2+  RFFXSLHV LQ SULQFLSOH WKH VDPH VWDELOLW\ GRPDLQ DV )H2 VHH )LJXUH 
>$@:LWKUHJDUGWRWKHDFWLYDWLRQHQHUJ\ZHFRQVLGHUERWKWREHSRWHQWLDOO\IRUPHG >$@:LWKUHJDUGWRWKHDFWLYDWLRQHQHUJ\ZHFRQVLGHUERWKWREHSRWHQWLDOO\IRUPHG
EXWEDVHGRQDFRPSDULVRQRIWKHPXWXDOIRUPDWLRQ)H2 µ¨*I¶ íN-PRO LV EXWEDVHGRQDFRPSDULVRQRIWKHPXWXDOIRUPDWLRQ)H2 µ¨*I¶ íN-PRO LV
 

)H2 2+ ±FRUUHVSRQGVWRELK\SRIHUULWHLRQ +)H2± 
)H2 2+ ±FRUUHVSRQGVWRELK\SRIHUULWHLRQ +)H2± 
‚ ‚
3RWHQWLDOVEHORZ±P96+(DQGWKHDVVRFLDWHGIRUPDWLRQRIR[\JHQ ,, LRQVDOVRUHIHUUHGWRDV 3RWHQWLDOVEHORZ±P96+(DQGWKHDVVRFLDWHGIRUPDWLRQRIR[\JHQ ,, LRQVDOVRUHIHUUHGWRDV
VXSHUR[LGHLRQVDUHNQRZQIURPILHOGVVXFKDVKLJKWHPSHUDWXUHR[LGDWLRQDQGSODVPDWHFKQLTXHIRU VXSHUR[LGHLRQVDUHNQRZQIURPILHOGVVXFKDVKLJKWHPSHUDWXUHR[LGDWLRQDQGSODVPDWHFKQLTXHIRU
LQVWDQFH LQVWDQFH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV

WKHUPRG\QDPLFDOO\ IDYRXUHG RYHU )H 2+  µ¨*I¶  í N-PRO  DQG FRQWUDU\ WR WKHUPRG\QDPLFDOO\ IDYRXUHG RYHU )H 2+  µ¨*I¶  í N-PRO  DQG FRQWUDU\ WR
)H 2+ WKHUHLVH[SHULPHQWDOHYLGHQFHIRUWKHIRUPDWLRQRI)H2 )H 2+ WKHUHLVH[SHULPHQWDOHYLGHQFHIRUWKHIRUPDWLRQRI)H2

 
)LJXUH >$@)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD í PRO/2ZQ )LJXUH >$@)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD í PRO/2ZQ
PHDVXUHPHQWVIURPµ7HVW,¶RISDVVLYHFDUERQVWHHOZLWKGLIIHUHQWVXU PHDVXUHPHQWVIURPµ7HVW,¶RISDVVLYHFDUERQVWHHOZLWKGLIIHUHQWVXU
IDFHSURSHUWLHVHPEHGGHGLQPRUWDU FI6HFWLRQ DUHLQGLFDWHGE\ IDFHSURSHUWLHVHPEHGGHGLQPRUWDU FI6HFWLRQ DUHLQGLFDWHGE\
WKH FRORXUHG EDUV WRS WR ERWWRP  ZHDWKHUHG ³&$´ UHG  DV WKH FRORXUHG EDUV WRS WR ERWWRP  ZHDWKHUHG ³&$´ UHG  DV
UHFHLYHG ³&$´ EOXH  GHJUHDVHG ³&$´ JUHHQ  +&O HWFKHG UHFHLYHG ³&$´ EOXH  GHJUHDVHG ³&$´ JUHHQ  +&O HWFKHG
³&$´\HOORZ DQGJULWEODVWHG ³&$´RUDQJH >%@$V>$@EXW ³&$´\HOORZ DQGJULWEODVWHG ³&$´RUDQJH >%@$V>$@EXW
ZLWKGHVHOHFWLRQRI)H2 IRUH[HPSOLILFDWLRQSXUSRVHVRQO\ >&@&D ZLWKGHVHOHFWLRQRI)H2 IRUH[HPSOLILFDWLRQSXUSRVHVRQO\ >&@&D
&+2µ0(3'¶EDVHGRQ7DEOHDQG&DLD í PRO/DQG&LD  &+2µ0(3'¶EDVHGRQ7DEOHDQG&DLD í PRO/DQG&LD 
íPRO/ íPRO/
 

7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH&D&+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH&D&+2V\VWHP

& &D &D&2 &D2 & &D &D&2 &D2


6ROLG 6ROLG
&D2 &D 2+    &D2 &D 2+   
  í í   í
6ROXEOH &D  &D 2+  &2  +&2  6ROXEOH &D  &D 2+  &2  +&2í
 
:LWKUHJDUGWRWKHDOWHUQDWLYHDQRGLFUHDFWLRQV>@DQG>@WKHIROORZLQJVKRXOG :LWKUHJDUGWRWKHDOWHUQDWLYHDQRGLFUHDFWLRQV>@DQG>@WKHIROORZLQJVKRXOG
EHQRWHG$OWKRXJKWKHUPRG\QDPLFDOO\SRVVLEOHZHGRQRWWKLQNWKDWWKHUHLVDUHOD EHQRWHG$OWKRXJKWKHUPRG\QDPLFDOO\SRVVLEOHZHGRQRWWKLQNWKDWWKHUHLVDUHOD
WLRQEHWZHHQWKHIRUPDWLRQRI)H2 2+ íLHKDOIFHOOUHDFWLRQ>@DQGWKHSURG WLRQEHWZHHQWKHIRUPDWLRQRI)H2 2+ íLHKDOIFHOOUHDFWLRQ>@DQGWKHSURG
XFWVWKDWFRQVWLWXWHWKHSDVVLYHOD\HU XFWVWKDWFRQVWLWXWHWKHSDVVLYHOD\HU
7KHWKHUPRG\QDPLFLQFRQVLVWHQF\EHWZHHQWKHR[LGDWLRQRILURQWRIHUURXVLRQ>@ 7KHWKHUPRG\QDPLFLQFRQVLVWHQF\EHWZHHQWKHR[LGDWLRQRILURQWRIHUURXVLRQ>@
DQG WKH IRUPDWLRQ RI WKHSDVVLYHOD\HUZDVDOUHDG\GLVFXVVHGLQ6HFWLRQEXW LW DQG WKH IRUPDWLRQ RI WKHSDVVLYH OD\HU ZDV DOUHDG\ GLVFXVVHG LQ6HFWLRQEXW LW
VKRXOGEHGHDOWZLWKKHUHDJDLQVLQFHLWDSSHDUVWRUHSUHVHQWDFRPPRQPLVFRQFHSWLRQ VKRXOGEHGHDOWZLWKKHUHDJDLQVLQFHLWDSSHDUVWRUHSUHVHQWDFRPPRQPLVFRQFHSWLRQ
LQ WKH WKHUPRG\QDPLFV RI UHLQIRUFHPHQW FRUURVLRQ $FFRUGLQJ WR >6DJRH&UHQWVLO  LQ WKH WKHUPRG\QDPLFV RI UHLQIRUFHPHQW FRUURVLRQ $FFRUGLQJ WR >6DJRH&UHQWVLO 
*ODVVHU@DQGVHYHUDORWKHUSXEOLFDWLRQVPLJUDWLRQRIWKHIHUURXVLRQIURP *ODVVHU@DQGVHYHUDORWKHUSXEOLFDWLRQVPLJUDWLRQRIWKHIHUURXVLRQIURP

)H → )H + + H− (( 
 = −  {} P96+( )  >@ )H → )H + + H− (( 
 = −  {} P96+( )  >@

WRZDUGVWKHFDWKRGLFVLWHIRUPLQJ2+í WRZDUGVWKHFDWKRGLFVLWHIRUPLQJ2+í

2  + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@ 2  + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

OHDGV WR IRUPDWLRQ RI LURQ R[LGH ZKLFK LV QRW GHVFULEHG E\ D UHDFWLRQ LQ >6DJRH OHDGV WR IRUPDWLRQ RI LURQ R[LGH ZKLFK LV QRW GHVFULEHG E\ D UHDFWLRQ LQ >6DJRH
&UHQWVLO *ODVVHU@EXWSUREDEO\FRQVLGHUHGWRWDNHSODFHDFFRUGLQJWR &UHQWVLO *ODVVHU@EXWSUREDEO\FRQVLGHUHGWRWDNHSODFHDFFRUGLQJWR

)H  2+ − → )H 2+  Δ*  −  N-  >@ )H  2+ − → )H 2+  Δ*  −  N-  >@

7KHLQYROYHGHTXLOLEULXPSRWHQWLDOVDQGWKHQHJDWLYHµ¨*¶RIWKLVPHFKDQLVPLOOXV 7KHLQYROYHGHTXLOLEULXPSRWHQWLDOVDQGWKHQHJDWLYHµ¨*¶RIWKLVPHFKDQLVPLOOXV
WUDWHVWKDWLWLVWKHUPRG\QDPLFDOO\SRVVLEOH+RZHYHUDVGHVFULEHGLQGHWDLOLQ6HFWLRQ WUDWHVWKDWLWLVWKHUPRG\QDPLFDOO\SRVVLEOH+RZHYHUDVGHVFULEHGLQGHWDLOLQ6HFWLRQ
ZHDVVXPHWKDWWKHDQRGLFIRUPDWLRQRI)HLVWKHUPRG\QDPLFDOO\XQIDYRXUHG ZHDVVXPHWKDWWKHDQRGLFIRUPDWLRQRI)HLVWKHUPRG\QDPLFDOO\XQIDYRXUHG
LQFRQFUHWHS+DERYH FI)LJXUH>$@ ZKLFKFDQJHQHUDOO\EHDVVRFLDWHGZLWK LQFRQFUHWHS+DERYH FI)LJXUH>$@ ZKLFKFDQJHQHUDOO\EHDVVRFLDWHGZLWK
FRQGLWLRQVLQWKHSDVVLYHVWDWH FRQGLWLRQVLQWKHSDVVLYHVWDWH
,QFRQWUDVWWRWKHDERYHSRVWXODWHGUHDFWLRQPHFKDQLVPVDQGLQ DFFRUGDQFHZLWKRXU ,QFRQWUDVWWRWKHDERYHSRVWXODWHGUHDFWLRQPHFKDQLVPVDQGLQ DFFRUGDQFHZLWKRXU
DVVXPSWLRQV PHQWLRQHG LQ 6HFWLRQ  ZH SURSRVH WKH IROORZLQJ VHW RI UHDFWLRQV WR DVVXPSWLRQV PHQWLRQHG LQ 6HFWLRQ  ZH SURSRVH WKH IROORZLQJ VHW RI UHDFWLRQV WR
VXIILFLHQWO\ DQG WKHUPRG\QDPLFDOO\ FRQVLVWHQWO\ GHVFULEH WKH SDVVLYH VWDWH RI FDUERQ VXIILFLHQWO\ DQG WKHUPRG\QDPLFDOO\ FRQVLVWHQWO\ GHVFULEH WKH SDVVLYH VWDWH RI FDUERQ
VWHHOLQFRQFUHWH VWHHOLQFRQFUHWH
‡ )DYRXUHGDQRGLFUHDFWLRQXQGHUJHQHUDOFRQGLWLRQV ‡ )DYRXUHGDQRGLFUHDFWLRQXQGHUJHQHUDOFRQGLWLRQV

 )H + +  2 → )H 2 + + + + H − (( 
 = −  P96+( )  >@  )H + +  2 → )H 2 + + + + H − (( 
 = −  P96+( )  >@

‡ $GGLWLRQDODQRGLFUHDFWLRQXQGHUJHQHUDOFRQGLWLRQVLI)H2LVSUHVHQW ‡ $GGLWLRQDODQRGLFUHDFWLRQXQGHUJHQHUDOFRQGLWLRQVLI)H2LVSUHVHQW

 )H2  + +  2 → )H  2 + + + + H − (( 
 =  P96+( )  >@  )H2  + +  2 → )H  2 + + + + H − (( 
 =  P96+( )  >@

‡ )DYRXUHGDQRGLFUHDFWLRQZLWKOLPLWHGDFFHVVWRR[\JHQ ‡ )DYRXUHGDQRGLFUHDFWLRQZLWKOLPLWHGDFFHVVWRR[\JHQ

 )H + +  2 → )H2  + + + + H − (( 
 = −  P96+( )  >@  )H + +  2 → )H2  + + + + H − (( 
 = −  P96+( )  >@

‡ 'RPLQDQWFDWKRGLFUHDFWLRQ ‡ 'RPLQDQWFDWKRGLFUHDFWLRQ

 2 + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@  2 + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@

‡ $GGLWLRQDOFDWKRGLFUHDFWLRQZLWKOLPLWHGDFFHVVWRR[\JHQLI)H2LVSUHVHQW ‡ $GGLWLRQDOFDWKRGLFUHDFWLRQZLWKOLPLWHGDFFHVVWRR[\JHQLI)H2LVSUHVHQW

 )H  2 + + + + H − → )H2 + +  2 (( 
 =  P96+( )  >@  )H  2 + + + + H − → )H2 + +  2 (( 
 =  P96+( )  >@

:LWKUHJDUGWRWKHLRQLFFXUUHQWIURPWKHSURSRVHGVHWRIUHDFWLRQVLWLVREYLRXVWKDW :LWKUHJDUGWRWKHLRQLFFXUUHQWIURPWKHSURSRVHGVHWRIUHDFWLRQVLWLVREYLRXVWKDW
WKH DQRGLF UHDFWLRQV >@ WR >@ IRUP + ZKLOH WKH GRPLQDQW FDWKRGLF UHDFWLRQ WKH DQRGLF UHDFWLRQV >@ WR >@ IRUP + ZKLOH WKH GRPLQDQW FDWKRGLF UHDFWLRQ
>@ IRUPV 2+í DQG WKH SRVVLEOH VXSSOHPHQWDU\ FDWKRGLF UHDFWLRQ DW ORZ µ(FRUU¶ >@ IRUPV 2+í DQG WKH SRVVLEOH VXSSOHPHQWDU\ FDWKRGLF UHDFWLRQ DW ORZ µ(FRUU¶
FRQVXPHV+>@6RLQFRQWUDVWWRWKHFRPPRQQRWLRQRIWKHLRQLFFXUUHQWEHLQJ FRQVXPHV+>@6RLQFRQWUDVWWRWKHFRPPRQQRWLRQRIWKHLRQLFFXUUHQWEHLQJ
HVWDEOLVKHG E\ PLJUDWLRQ RI IHUURXV LRQV WR FDWKRGLF VLWHV ZKHUH WKH\ FRPELQH ZLWK HVWDEOLVKHG E\ PLJUDWLRQ RI IHUURXV LRQV WR FDWKRGLF VLWHV ZKHUH WKH\ FRPELQH ZLWK
K\GUR[\O LRQV WR IRUP LURQ K\GUR[LGH FI UHDFWLRQV >@ WR >@  ZH XQGHUVWDQG K\GUR[\O LRQV WR IRUP LURQ K\GUR[LGH FI UHDFWLRQV >@ WR >@  ZH XQGHUVWDQG
WKHLRQLFFXUUHQWLQWKHSDVVLYHVWDWHWREHSULPDU\HVWDEOLVKHGE\PLJUDWLRQRI+DQG WKHLRQLFFXUUHQWLQWKHSDVVLYHVWDWHWREHSULPDU\HVWDEOLVKHGE\PLJUDWLRQRI+DQG
2+í WKDW FRPELQH WR IRUP ZDWHU RU OHVV VLJQLILFDQWO\ WKH LRQLF FXUUHQW FDQ DOVR EH 2+í WKDW FRPELQH WR IRUP ZDWHU RU OHVV VLJQLILFDQWO\ WKH LRQLF FXUUHQW FDQ DOVR EH
HVWDEOLVKHGE\FRQVXPSWLRQRI+DVHJGHVFULEHGE\KDOIFHOOUHDFWLRQ>@ HVWDEOLVKHGE\FRQVXPSWLRQRI+DVHJGHVFULEHGE\KDOIFHOOUHDFWLRQ>@
%HVLGHV WKH WKHUPRG\QDPLF FRQVLVWHQF\ RI WKLV FRQFHSW RI WKH LRQLF FXUUHQW ZH DV %HVLGHV WKH WKHUPRG\QDPLF FRQVLVWHQF\ RI WKLV FRQFHSW RI WKH LRQLF FXUUHQW ZH DV
VXPHWKDWWKHPLJUDWLRQRI+DQG2+íLVNLQHWLFDOO\IDYRXUHGRYHUPLJUDWLRQRIHJ VXPHWKDWWKHPLJUDWLRQRI+DQG2+íLVNLQHWLFDOO\IDYRXUHGRYHUPLJUDWLRQRIHJ
)H IRU WKH HVWDEOLVKPHQW RI WKH LRQLF FXUUHQW 7KLV QRWLRQ LV EDVHG RQ WKH KLJK LRQ )H IRU WKH HVWDEOLVKPHQW RI WKH LRQLF FXUUHQW 7KLV QRWLRQ LV EDVHG RQ WKH KLJK LRQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV

PRELOLW\ RI + DQG 2+í GXH WR WKHLU LQWHUDFWLRQ ZLWK ZDWHU LH WKDW QR DFWXDO GLV PRELOLW\ RI + DQG 2+í GXH WR WKHLU LQWHUDFWLRQ ZLWK ZDWHU LH WKDW QR DFWXDO GLV
SODFHPHQWLVUHTXLUHG FI6HFWLRQ  SODFHPHQWLVUHTXLUHG FI6HFWLRQ 
$V PHQWLRQHG LQ 6HFWLRQ  LW FDQ EH FRQFOXGHG IURP WKH 3RXUEDL[ GLDJUDP WKDW $V PHQWLRQHG LQ 6HFWLRQ  LW FDQ EH FRQFOXGHG IURP WKH 3RXUEDL[ GLDJUDP WKDW
IRUPDWLRQRIWKHVROXEOHVSHFLHV+)H2íFDQSOD\DUROHZLWKYHU\ORZµ(FRUU¶YDOXHVLQ IRUPDWLRQRIWKHVROXEOHVSHFLHV+)H2íFDQSOD\DUROHZLWKYHU\ORZµ(FRUU¶YDOXHVLQ
WKHSDVVLYHUDQJH7KLVLVGHDOWZLWKLQ6HFWLRQ WKHSDVVLYHUDQJH7KLVLVGHDOWZLWKLQ6HFWLRQ
$YHULILFDWLRQRIWKHDERYHGHVFULEHGPHFKDQLVPEDVHGRQWKHLQYROYHGHTXLOLEULXP $YHULILFDWLRQRIWKHDERYHGHVFULEHGPHFKDQLVPEDVHGRQWKHLQYROYHGHTXLOLEULXP
SRWHQWLDOVµ(¶LQWKHS+UDQJHRIFRQFHUQLVQRWQHFHVVDU\VLQFHDOOLQYROYHGKDOIFHOO SRWHQWLDOVµ(¶LQWKHS+UDQJHRIFRQFHUQLVQRWQHFHVVDU\VLQFHDOOLQYROYHGKDOIFHOO
UHDFWLRQVDSDUWIURP>@DUHUHSUHVHQWHGE\WKHDVVRFLDWHGHTXLOLEULXPOLQHVLQWKH UHDFWLRQVDSDUWIURP>@DUHUHSUHVHQWHGE\WKHDVVRFLDWHGHTXLOLEULXPOLQHVLQWKH
3RXUEDL[GLDJUDP FI)LJXUH>$@ 7KH HTXLOLEULXPSRWHQWLDORI>@DWHJS+ 3RXUEDL[GLDJUDP FI)LJXUH>$@ 7KH HTXLOLEULXPSRWHQWLDORI>@DWHJS+
ZDVJLYHQLQ6HFWLRQWR ZDVJLYHQLQ6HFWLRQWR

)H + +  2 → )H 2 + + + + H − (( 
 = −  P96+( ) >@
)H + +  2 → )H 2 + + + + H − (( 
 = −  P96+( ) >@
(  ( S+ ) = −  P96+( (  ( S+ ) = −  P96+(

:LWKUHJDUGWRKDOIFHOOUHDFWLRQ>@LWVKRXOGEHQRWHGWKDWLQ>3RXUEDL[E@ :LWKUHJDUGWRKDOIFHOOUHDFWLRQ>@LWVKRXOGEHQRWHGWKDWLQ>3RXUEDL[E@
DQHTXLOLEULXPEHWZHHQ)HDQG)H2LVSRVWXODWHGWRH[LVWLQWKH)H+2µ6(3'¶LI DQHTXLOLEULXPEHWZHHQ)HDQG)H2LVSRVWXODWHGWRH[LVWLQWKH)H+2µ6(3'¶LI
IRUPDWLRQRI)H2LVQRWWDNHQLQWRDFFRXQW+RZHYHUEDVHGRQWKHWKHUPRG\QDPLF IRUPDWLRQRI)H2LVQRWWDNHQLQWRDFFRXQW+RZHYHUEDVHGRQWKHWKHUPRG\QDPLF
GDWDLQµ+6&¶ FI6HFWLRQ WKLVHTXLOLEULXPGRHVQRWH[LVW7KHVWDELOLW\GRPDLQV GDWDLQµ+6&¶ FI6HFWLRQ WKLVHTXLOLEULXPGRHVQRWH[LVW7KHVWDELOLW\GRPDLQV
RI)HDQG+)H2íDUHIDYRXUHGWRH[WHQGLQWKHDVVRFLDWHG³LQWHUVHFWLRQ´EHWZHHQ)H RI)HDQG+)H2íDUHIDYRXUHGWRH[WHQGLQWKHDVVRFLDWHG³LQWHUVHFWLRQ´EHWZHHQ)H
DQG )H2 ZLWK GHVHOHFWLRQ RI )H2 FI )LJXUH  >%@  <HW WKLV QRWLRQ LV MXVW RI DQG )H2 ZLWK GHVHOHFWLRQ RI )H2 FI )LJXUH  >%@  <HW WKLV QRWLRQ LV MXVW RI
WKHRUHWLFDOFRQFHUQDQGLQVLJQLILFDQWLQSUDFWLFH WKHRUHWLFDOFRQFHUQDQGLQVLJQLILFDQWLQSUDFWLFH
%HIRUH WKH LQIOXHQFH RI LQFOXVLRQV RI FHPHQW K\GUDWHV LQ WKH SDVVLYH OD\HU DQG WKH %HIRUH WKH LQIOXHQFH RI LQFOXVLRQV RI FHPHQW K\GUDWHV LQ WKH SDVVLYH OD\HU DQG WKH
WKHUPRG\QDPLFFRQVHTXHQFHVLVEULHIO\GHDOWZLWKDVKRUWQRWHRQRZQPHDVXUHPHQWV WKHUPRG\QDPLFFRQVHTXHQFHVLVEULHIO\GHDOWZLWKDVKRUWQRWHRQRZQPHDVXUHPHQWV
LQFOXGHGLQ)LJXUH>$@VKRXOGEHPDGH:HFRQVLGHUWKHSRWHQWLDOUDQJHDQGWKH LQFOXGHGLQ)LJXUH>$@VKRXOGEHPDGH:HFRQVLGHUWKHSRWHQWLDOUDQJHDQGWKH
³UDQNLQJ´ RI ZHDWKHUHG DVUHFHLYHG GHJUHDVHG +&O HWFKHG DQG JULWEODVWHG FDUERQ ³UDQNLQJ´ RI ZHDWKHUHG DVUHFHLYHG GHJUHDVHG +&O HWFKHG DQG JULWEODVWHG FDUERQ
VWHHOUHEDU IURPKLJKHUWRORZHU µ(FRUU¶WREHLQ JRRG DJUHHPHQWZLWKWKHDERYHGLV VWHHOUHEDU IURPKLJKHUWRORZHU µ(FRUU¶WREHLQ JRRG DJUHHPHQWZLWKWKHDERYHGLV
FXVVHGWKHRU\WKHVWDWHPHQWVPDGHWKURXJKRXW6HFWLRQVDQGDQGWKHOLWHUD FXVVHGWKHRU\WKHVWDWHPHQWVPDGHWKURXJKRXW6HFWLRQVDQGDQGWKHOLWHUD
WXUHHJ>*RQ]DOH]HWDO@7KXVLWFDQEHFRQFOXGHGWKDWDSDVVLYHSUHFRUURGHG WXUHHJ>*RQ]DOH]HWDO@7KXVLWFDQEHFRQFOXGHGWKDWDSDVVLYHSUHFRUURGHG
FDUERQVWHHOVXUIDFHLVDWDVOLJKWO\KLJKHU µ(FRUU¶ WKDQ DSDVVLYH FDUERQ VWHHO VXUIDFH FDUERQVWHHOVXUIDFHLVDWDVOLJKWO\KLJKHU µ(FRUU¶ WKDQ DSDVVLYH FDUERQ VWHHO VXUIDFH
ZLWKRXWLQLWLDOFRUURVLRQSURGXFWV ZLWKRXWLQLWLDOFRUURVLRQSURGXFWV
$V PHQWLRQHG LQ 6HFWLRQ  &D&2 KDV EHHQ REVHUYHG DV D FRQVWLWXHQW RI WKH $V PHQWLRQHG LQ 6HFWLRQ  &D&2 KDV EHHQ REVHUYHG DV D FRQVWLWXHQW RI WKH
SDVVLYHOD\HURIVWHHOLQFRQFUHWH>3RXUVDHH +DQVVRQ@$OWKRXJKWKHHIIHFWRI SDVVLYHOD\HURIVWHHOLQFRQFUHWH>3RXUVDHH +DQVVRQ@$OWKRXJKWKHHIIHFWRI
FDOFLWHRQWKHHOHFWURFKHPLVWU\RQVWHHOLQFRQFUHWHFDQQRWEHGLUHFWO\WKHUPRG\QDPL FDOFLWHRQWKHHOHFWURFKHPLVWU\RQVWHHOLQFRQFUHWHFDQQRWEHGLUHFWO\WKHUPRG\QDPL
FDOO\ YHULILHG WKHUPRG\QDPLF GDWD RI LURQFDOFLWH FRPSOH[HV LV QRW DYDLODEOH LQ FDOO\ YHULILHG WKHUPRG\QDPLF GDWD RI LURQFDOFLWH FRPSOH[HV LV QRW DYDLODEOH LQ
>2XNX2XNX@DQGKDVQRWEHHQIRXQGHOVHZKHUH WKHSRVVLELOLW\RIIRU >2XNX2XNX@DQGKDVQRWEHHQIRXQGHOVHZKHUH WKHSRVVLELOLW\RIIRU
PDWLRQ RI &D&2 FDQEH YHULILHGE\PHDQVRIWKH&D&+2µ0(3'¶LQ)LJXUH PDWLRQRI&D&2 FDQEH YHULILHGE\ PHDQV RI WKH &D&+2µ0(3'¶LQ)LJXUH
>&@ ZKLFK LV EDVHG RQ WKH SUHVHOHFWLRQ JLYHQ LQ 7DEOH  ,W FDQ EH REVHUYHG WKDW >&@ ZKLFK LV EDVHG RQ WKH SUHVHOHFWLRQ JLYHQ LQ 7DEOH  ,W FDQ EH REVHUYHG WKDW
IRUPDWLRQRI FDOFLWHFRPSOH[HVLVWKHUPRG\QDPLFDOO\ IDYRXUHGLQ DVWDELOLW\GRPDLQ IRUPDWLRQRI FDOFLWHFRPSOH[HVLVWKHUPRG\QDPLFDOO\ IDYRXUHGLQ DVWDELOLW\GRPDLQ
WKDWLVDVVRFLDWHGZLWKWKHS+DQG(FRUUIRUSDVVLYHVWHHOLQFRQFUHWH7KXVIRUPDWLRQ WKDWLVDVVRFLDWHGZLWKWKHS+DQG(FRUUIRUSDVVLYHVWHHOLQFRQFUHWH7KXVIRUPDWLRQ
RIVXFKFRPSOH[HVLVYHU\OLNHO\:HDVVXPHWKDW&D&2GRHVQRWLQWHUIHUHQHJDWLYHO\ RIVXFKFRPSOH[HVLVYHU\OLNHO\:HDVVXPHWKDW&D&2GRHVQRWLQWHUIHUHQHJDWLYHO\

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

ZLWKWKHIRUPDWLRQRIDVWDEOHSDVVLYHOD\HU DVRSSRVHGWRHJZLWKWKHSDVVLYDWLRQRI ZLWKWKHIRUPDWLRQRIDVWDEOHSDVVLYHOD\HU DVRSSRVHGWRHJZLWKWKHSDVVLYDWLRQRI


PDJQHVLXPLQFRQFUHWHFI6HFWLRQ  PDJQHVLXPLQFRQFUHWHFI6HFWLRQ 
,QFRQFOXVLRQLWFDQEHVDLGWKDW ,QFRQFOXVLRQLWFDQEHVDLGWKDW
‡ 9DULRXVFKHPLFDOVSHFLHVDUHSUHVHQWDQGVHYHUDOFRPSOH[SKDVHWUDQVIRUPDWLRQV ‡ 9DULRXVFKHPLFDOVSHFLHVDUHSUHVHQWDQGVHYHUDOFRPSOH[SKDVHWUDQVIRUPDWLRQV
WDNHSODFHLQWKHPXOWLIDFHWHGFKHPLVWU\RIFRQFUHWHLQSDUWLFXODUGXULQJK\GUDWLRQ WDNHSODFHLQWKHPXOWLIDFHWHGFKHPLVWU\RIFRQFUHWHLQSDUWLFXODUGXULQJK\GUDWLRQ
FI6HFWLRQ EXWZHSRVWXODWHWKDWQRRWKHUVSHFLHVRUWUDQVIRUPDWLRQVWKDQWKH FI6HFWLRQ EXWZHSRVWXODWHWKDWQRRWKHUVSHFLHVRUWUDQVIRUPDWLRQVWKDQWKH
RQHV WKDW DIIHFW WKH + DQG 2+í FRQFHQWUDWLRQ WKH S+  KDYH D VLJQLILFDQW LQIOX RQHV WKDW DIIHFW WKH + DQG 2+í FRQFHQWUDWLRQ WKH S+  KDYH D VLJQLILFDQW LQIOX
HQFHRQWKHSDVVLYDWLRQRIFDUERQVWHHOLQFRQFUHWH HQFHRQWKHSDVVLYDWLRQRIFDUERQVWHHOLQFRQFUHWH
‡ 0RUHRYHUIURPWKHDERYHLWFDQEHGHGXFHGWKDW³YLFHYHUVD´WKHFRQFUHWHFKHP ‡ 0RUHRYHUIURPWKHDERYHLWFDQEHGHGXFHGWKDW³YLFHYHUVD´WKHFRQFUHWHFKHP
LVWU\LVQRWVLJQLILFDQWO\ LQIOXHQFHG HJ FRQFHUQLQJK\GUDWLRQFI6HFWLRQ  LVWU\LVQRWVLJQLILFDQWO\ LQIOXHQFHG HJ FRQFHUQLQJK\GUDWLRQFI6HFWLRQ 
E\WKHSUHVHQFHRIFDUERQVWHHO E\WKHSUHVHQFHRIFDUERQVWHHO
‡ *LYHQWKDWWKHDERYHLVWUXHZHSRVWXODWHWKDWWKHWKHUPRG\QDPLFVRIWKHSDVVLYH ‡ *LYHQWKDWWKHDERYHLVWUXHZHSRVWXODWHWKDWWKHWKHUPRG\QDPLFVRIWKHSDVVLYH
VWDWH LV VXIILFLHQWO\ DQG WKHUPRG\QDPLFDOO\ FRQVLVWHQWO\  UHIOHFWHG E\ WKH SUR VWDWH LV VXIILFLHQWO\ DQG WKHUPRG\QDPLFDOO\ FRQVLVWHQWO\  UHIOHFWHG E\ WKH SUR
SRVHGVHWRIUHDFWLRQV LQFRQWUDVWWRVRPHUHDFWLRQPHFKDQLVPVSRVWXODWHGLQWKH SRVHGVHWRIUHDFWLRQV LQFRQWUDVWWRVRPHUHDFWLRQPHFKDQLVPVSRVWXODWHGLQWKH
OLWHUDWXUH  OLWHUDWXUH 
:H WKLQN WKDW WKLV DOVR LV FRQILUPHG E\ WKH JRRG FRUUHVSRQGHQFH EHWZHHQ WKH :H WKLQN WKDW WKLV DOVR LV FRQILUPHG E\ WKH JRRG FRUUHVSRQGHQFH EHWZHHQ WKH
µ(FRUU¶YDOXHVWKDWFDQEHGHGXFHGIURPWKHSURSRVHGDQRGLFDQGFDWKRGLFUHDFWLRQV µ(FRUU¶YDOXHVWKDWFDQEHGHGXFHGIURPWKHSURSRVHGDQRGLFDQGFDWKRGLFUHDFWLRQV
DQGDFWXDOYDOXHVRIµ(FRUU¶SXEOLVKHGLQWKHOLWHUDWXUHRUPHDVXUHGLQRZQLQYHVWL DQGDFWXDOYDOXHVRIµ(FRUU¶SXEOLVKHGLQWKHOLWHUDWXUHRUPHDVXUHGLQRZQLQYHVWL
JDWLRQV JDWLRQV
:HFRQVLGHUWKHDERYHQRWLRQVWREHFHQWUDOIRUWKHXQGHUO\LQJSULQFLSOHVDVWR³ZK\ :HFRQVLGHUWKHDERYHQRWLRQVWREHFHQWUDOIRUWKHXQGHUO\LQJSULQFLSOHVDVWR³ZK\
DQGKRZ´WKHFRQFUHWHVWHHOV\VWHPDFWXDOO\ZRUNV)URPDWKHRUHWLFDODQGSUHGLFWLYH DQGKRZ´WKHFRQFUHWHVWHHOV\VWHPDFWXDOO\ZRUNV)URPDWKHRUHWLFDODQGSUHGLFWLYH
SHUVSHFWLYHWKHVHQRWLRQVFDQRQO\EHDVVHVVHGE\WKHUPRG\QDPLFFRQVLGHUDWLRQVDQG SHUVSHFWLYHWKHVHQRWLRQVFDQRQO\EHDVVHVVHGE\WKHUPRG\QDPLFFRQVLGHUDWLRQVDQG
ZHUHJDUGWKH3RXUEDL[GLDJUDPDVDEHQHILFLDOWRROWREDVHWKHVHFRQVLGHUDWLRQVXSRQ ZHUHJDUGWKH3RXUEDL[GLDJUDPDVDEHQHILFLDOWRROWREDVHWKHVHFRQVLGHUDWLRQVXSRQ
+RZHYHULWVKRXOGEHHPSKDVLVHGWKDWWKHSRVVLELOLW\RIUHSUHVHQWLQJWKHHOHFWURFKHP +RZHYHULWVKRXOGEHHPSKDVLVHGWKDWWKHSRVVLELOLW\RIUHSUHVHQWLQJWKHHOHFWURFKHP
LVWU\RIDPHWDOLQXQFRQWDPLQDWHGFRQFUHWHE\DQµ6(3'¶LVDWOHDVWIRUWKHPHWDOVRI LVWU\RIDPHWDOLQXQFRQWDPLQDWHGFRQFUHWHE\DQµ6(3'¶LVDWOHDVWIRUWKHPHWDOVRI
FRQFHUQ LQ WKLV WKHVLV OLPLWHG WR VWHHO 7KH µ6(3'¶ UHSUHVHQWDWLRQ LV RQO\ SDUWO\ DS FRQFHUQ LQ WKLV WKHVLV OLPLWHG WR VWHHO 7KH µ6(3'¶ UHSUHVHQWDWLRQ LV RQO\ SDUWO\ DS
SURSULDWHIRU]LQFDQGLQVXIILFLHQWIRUPDJQHVLXP FI6HFWLRQ  SURSULDWHIRU]LQFDQGLQVXIILFLHQWIRUPDJQHVLXP FI6HFWLRQ 

 /RZ3RWHQWLDO&RUURVLRQ  /RZ3RWHQWLDO&RUURVLRQ


,QWKH3RXUEDL[GLDJUDPRI)LJXUH>$@ FI6HFWLRQ LWFDQEHREVHUYHGWKDW ,QWKH3RXUEDL[GLDJUDPRI)LJXUH>$@ FI6HFWLRQ LWFDQEHREVHUYHGWKDW
DGRPDLQRIDFWLYHFRUURVLRQH[LVWVLQDS+UDQJHRIDWYHU\ORZSRWHQWLDOVRI DGRPDLQRIDFWLYHFRUURVLRQH[LVWVLQDS+UDQJHRIDWYHU\ORZSRWHQWLDOVRI
DURXQGíP96+(7KLVFRUURVLRQVWDWHLVJHQHUDOO\UHIHUUHGWRDVORZSRWHQWLDOFRU DURXQGíP96+(7KLVFRUURVLRQVWDWHLVJHQHUDOO\UHIHUUHGWRDVORZSRWHQWLDOFRU
URVLRQ ,WPD\RFFXUIRU FDUERQVWHHOLQFRQFUHWHZLWKDOPRVWQRDYDLODELOLW\RIR[\ URVLRQ ,WPD\RFFXUIRU FDUERQVWHHOLQFRQFUHWHZLWKDOPRVWQRDYDLODELOLW\RIR[\
JHQ+RZHYHUDVPHQWLRQHGLQ6HFWLRQZHDVVXPHWKDWWKHDVVRFLDWHGPDJQL JHQ+RZHYHUDVPHQWLRQHGLQ6HFWLRQZHDVVXPHWKDWWKHDVVRFLDWHGPDJQL
WXGHVRIµ(FRUU¶DUHGLIILFXOWWRDWWDLQ HYHQXQGHUODERUDWRU\FRQGLWLRQV JLYHQWKDWQR WXGHVRIµ(FRUU¶DUHGLIILFXOWWRDWWDLQ HYHQXQGHUODERUDWRU\FRQGLWLRQV JLYHQWKDWQR

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV

PHDQV RI FDWKRGLFSRODULVDWLRQ DUHSUHVHQW 7KHDFWXDOµ(FRUU¶ IRUWKLVW\SHRIFRUUR PHDQV RI FDWKRGLFSRODULVDWLRQ DUHSUHVHQW  7KH DFWXDO µ(FRUU¶ IRUWKLVW\SHRIFRUUR
VLRQZDVPHDVXUHGWRíP96+(>$UXS@ZKLFKLVIRXQGLQJRRGDJUHHPHQW VLRQZDVPHDVXUHGWRíP96+(>$UXS@ZKLFKLVIRXQGLQJRRGDJUHHPHQW
ZLWKWKH3RXUEDL[GLDJUDPDQGKHQFHZLWKWKHUPRG\QDPLFV7KHFRUURVLRQUDWHXQGHU ZLWKWKH3RXUEDL[GLDJUDPDQGKHQFHZLWKWKHUPRG\QDPLFV7KHFRUURVLRQUDWHXQGHU
WKLVFRQGLWLRQZDVGHWHUPLQHGWREHYHU\ORZLHDVORZRUORZHUWKDQLQWKHSDVVLYH WKLVFRQGLWLRQZDVGHWHUPLQHGWREHYHU\ORZLHDVORZRUORZHUWKDQLQWKHSDVVLYH
VWDWH>$UXS@$FFRUGLQJO\ZHUHJDUGWKLV WKHUPRG\QDPLFDOO\DFWLYHFRUURVLRQ VWDWH >$UXS @ $FFRUGLQJO\ ZH UHJDUG WKLV WKHUPRG\QDPLFDOO\DFWLYHFRUURVLRQ
VWDWHDVDSDVVLYHVWDWHLQWHUPVRIWKHDFWXDOO\YHU\ORZFRUURVLRQUDWH VWDWHDVDSDVVLYHVWDWHLQWHUPVRIWKHDFWXDOO\YHU\ORZFRUURVLRQUDWH
,QIRUPDWLRQRQFRUURVLRQPHFKDQLVPVGHVFULELQJORZSRWHQWLDOFRUURVLRQLQWKHOLWHUD ,QIRUPDWLRQRQFRUURVLRQPHFKDQLVPVGHVFULELQJORZSRWHQWLDOFRUURVLRQLQWKHOLWHUD
WXUHLVVFDUFHEXWWKHIROORZLQJVHWRIUHDFWLRQVZDVSRVWXODWHG>6DQGEHUJ@ WXUHLVVFDUFHEXWWKHIROORZLQJVHWRIUHDFWLRQVZDVSRVWXODWHG>6DQGEHUJ@

)H + +  2 → +)H2 − + +  + H − (( 
 =  P96+( )  >@ )H + +  2 → +)H2 − + +  + H − (( 
 =  P96+( )  >@

)H  2 + 2+ − → +)H2 − + 2  ( Δ* 


=  N- )  >@ )H  2 + 2+ − → +)H2 − + 2  ( Δ* 
=  N- )  >@

:H DJUHH WR KDOIFHOO UHDFWLRQ >@ ZKLFK FRUUHVSRQGV WR WKH HTXLOLEULXP OLQH EH :H DJUHH WR KDOIFHOO UHDFWLRQ >@ ZKLFK FRUUHVSRQGV WR WKH HTXLOLEULXP OLQH EH
WZHHQ)HDQGELK\SRIHUULWHLRQ +)H2í LQWKH3RXUEDL[GLDJUDPRIWKH)H+2V\V WZHHQ)HDQGELK\SRIHUULWHLRQ +)H2í LQWKH3RXUEDL[GLDJUDPRIWKH)H+2V\V
WHP FI6HFWLRQDQG)LJXUH>$@ <HWWKHUHGR[UHDFWLRQ>@GLVSOD\VD WHP FI6HFWLRQDQG)LJXUH>$@ <HWWKHUHGR[UHDFWLRQ>@GLVSOD\VD
SRVLWLYHµ¨*¶0RUHRYHUWKLVVHWRIUHDFWLRQVGRHVQRWDFFRXQWIRUSRVVLEOHFRQVWLWXWHV SRVLWLYHµ¨*¶0RUHRYHUWKLVVHWRIUHDFWLRQVGRHVQRWDFFRXQWIRUSRVVLEOHFRQVWLWXWHV
RIPDJQHWLWHLQWKHSDVVLYHOD\HU6RLQDFFRUGDQFHZLWK6HFWLRQDQGZLWKSDU RIPDJQHWLWHLQWKHSDVVLYHOD\HU6RLQDFFRUGDQFHZLWK6HFWLRQDQGZLWKSDU
WLFXODUUHJDUGWRWKHSURSRVHGIXQGDPHQWDOFRUURVLRQPHFKDQLVP FI6HFWLRQ ZH WLFXODUUHJDUGWRWKHSURSRVHGIXQGDPHQWDOFRUURVLRQPHFKDQLVP FI6HFWLRQ ZH
SURSRVHWKHIROORZLQJUHDFWLRQPHFKDQLVPIRUWKHGHVFULSWLRQRIDFWLYHORZSRWHQWLDO SURSRVHWKHIROORZLQJUHDFWLRQPHFKDQLVPIRUWKHGHVFULSWLRQRIDFWLYHORZSRWHQWLDO
FRUURVLRQ FRUURVLRQ
‡ )DYRXUHGDQRGLFUHDFWLRQ ‡ )DYRXUHGDQRGLFUHDFWLRQ

 )H + +  2 → +)H2 − + + + + H − (( 
 =  P96+( )  >@  )H + +  2 → +)H2 − + + + + H − (( 
 =  P96+( )  >@

‡ 'RPLQDQWFDWKRGLFUHDFWLRQV‚ ‡ 'RPLQDQWFDWKRGLFUHDFWLRQV‚

 2 + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@  2 + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@

 )H  2 + +  2 + H − → +)H2 − (( 
 = −  P96+( )  >@  )H  2 + +  2 + H − → +)H2 − (( 
 = −  P96+( )  >@

 )H2  + +  2 + H− → +)H2 − + + + (( 


 = −  P96+( )  >@  )H2  + +  2 + H− → +)H2 − + + + (( 
 = −  P96+( )  >@

‡ 6XSSOHPHQWDU\ FDWKRGLF UHDFWLRQ ZKLFK ZH FRQVLGHU DV UDWKHU XQOLNHO\ ZLWK UH ‡ 6XSSOHPHQWDU\ FDWKRGLF UHDFWLRQ ZKLFK ZH FRQVLGHU DV UDWKHU XQOLNHO\ ZLWK UH
JDUG WR WKH PLQLPDO µ(FRUU¶ WKDW FDQ EH REWDLQHG IRU XQSRODULVHG FDUERQ VWHHO LQ JDUG WR WKH PLQLPDO µ(FRUU¶ WKDW FDQ EH REWDLQHG IRU XQSRODULVHG FDUERQ VWHHO LQ
FRQFUHWH DQG WKH H[LVWHQFH RI K\GURJHQ RYHUSRWHQWLDO LQ SUDFWLFH FI 6HFWLRQV FRQFUHWH DQG WKH H[LVWHQFH RI K\GURJHQ RYHUSRWHQWLDO LQ SUDFWLFH FI 6HFWLRQV
DQG  DQG 
 

$FFRUGLQJWR>1\JDDUG@FRUURVLRQPRQLWRULQJDWWKH2UHVXQG)L[HG/LQNEHWZHHQ&RSHQKD $FFRUGLQJWR>1\JDDUG@FRUURVLRQPRQLWRULQJDWWKH2UHVXQG)L[HG/LQNEHWZHHQ&RSHQKD
JHQ'HQPDUNDQG0DOP|6ZHGHQUHYHDOHGDYHU\ORZSRODULVDWLRQUHVLVWDQFH LHDFWLYHFRUUR JHQ'HQPDUNDQG0DOP|6ZHGHQUHYHDOHGDYHU\ORZSRODULVDWLRQUHVLVWDQFH LHDFWLYHFRUUR
VLRQ EDVHGRQµ/35¶PHDVXUHPHQWV FI6HFWLRQ DWYHU\ORZFRUURVLRQSRWHQWLDOVRIFDUERQ VLRQ EDVHGRQµ/35¶PHDVXUHPHQWV FI6HFWLRQ DWYHU\ORZFRUURVLRQSRWHQWLDOVRIFDUERQ
VWHHOLQXQFRQWDPLQDWHGYHU\GHQVHDQGIXOO\VDWXUDWHGFRQFUHWH:HWKLQNWKDWVXFKREVHUYDWLRQV VWHHOLQXQFRQWDPLQDWHGYHU\GHQVHDQGIXOO\VDWXUDWHGFRQFUHWH:HWKLQNWKDWVXFKREVHUYDWLRQV
FDQDFWXDOO\EHDGGUHVVHGWRORZSRWHQWLDOFRUURVLRQ FDQDFWXDOO\EHDGGUHVVHGWRORZSRWHQWLDOFRUURVLRQ
‚
7KHR[LGDWLRQVWDWHRI+)H2íLVZKHUHDVWKHR[LGDWLRQVWDWHVRI)H2DQG)H2DUHDQG ‚
7KHR[LGDWLRQVWDWHRI+)H2íLVZKHUHDVWKHR[LGDWLRQVWDWHVRI)H2DQG)H2DUHDQG
UHVSHFWLYHO\ UHVSHFWLYHO\

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

 +  2 + H − → +  + 2+ − (( 
 = −  ^−` P96+( )  >@  +  2 + H − → +  + 2+ − (( 
 = −  ^−` P96+( )  >@

:LWKUHJDUGWRWKHLRQLFFXUUHQWZHDVVXPHWKDWSULQFLSDOO\WKHVDPHDSSOLHVWRORZ :LWKUHJDUGWRWKHLRQLFFXUUHQWZHDVVXPHWKDWSULQFLSDOO\WKHVDPHDSSOLHVWRORZ
SRWHQWLDOFRUURVLRQDVGHVFULEHGLQ6HFWLRQIRUSDVVLYLW\EXW ZH FRQVLGHU WKH SRWHQWLDOFRUURVLRQDVGHVFULEHGLQ6HFWLRQIRUSDVVLYLW\EXWZHFRQVLGHUWKH
HIIHFWRIWKHFDWKRGLFUHDFWLRQV>@DQG>@WREHRIPRUHUHOHYDQFHLQORZSRWHQ HIIHFWRIWKHFDWKRGLFUHDFWLRQV>@DQG>@WREHRIPRUHUHOHYDQFHLQORZSRWHQ
WLDOFRUURVLRQWKDQLQSDVVLYLW\7KHVXUSOXVRI+>@DQGWKHUHVXOWLQJS+GURSLQ WLDOFRUURVLRQWKDQLQSDVVLYLW\7KHVXUSOXVRI+>@DQGWKHUHVXOWLQJS+GURSLQ
FRPELQDWLRQZLWKSRVVLEOHDOWHUDWLRQVLQR[\JHQDYDLODELOLW\ZLOOIDYRXUUHSDVVLYDWLRQ FRPELQDWLRQZLWKSRVVLEOHDOWHUDWLRQVLQR[\JHQDYDLODELOLW\ZLOOIDYRXUUHSDVVLYDWLRQ
VRRQDIWHUµ(FRUU¶IHOOLQWRWKHVWDELOLW\GRPDLQ+)H2í FI)LJXUH>$@  VRRQDIWHUµ(FRUU¶IHOOLQWRWKHVWDELOLW\GRPDLQ+)H2í FI)LJXUH>$@ 

 $FWLYH&RUURVLRQ6WDWH  $FWLYH&RUURVLRQ6WDWH


,Q WKLV 6HFWLRQ WKH GHVFULSWLRQ RI FDUERQDWLRQ DQG FKORULGH LQGXFHG DFWLYH FRUURVLRQ ,Q WKLV 6HFWLRQ WKH GHVFULSWLRQ RI FDUERQDWLRQ DQG FKORULGH LQGXFHG DFWLYH FRUURVLRQ
EDVHGRQWKH3RXUEDL[GLDJUDPLVH[HPSOLILHGLQ6HFWLRQDQG6HFWLRQ EDVHGRQWKH3RXUEDL[GLDJUDPLVH[HPSOLILHGLQ6HFWLRQDQG6HFWLRQ
UHVSHFWLYHO\:KLOHERWKFRUURVLRQLQLWLDWLRQDQGSURSDJDWLRQFDQEHDVVHVVHGWKHUPR UHVSHFWLYHO\:KLOHERWKFRUURVLRQLQLWLDWLRQDQGSURSDJDWLRQFDQEHDVVHVVHGWKHUPR
G\QDPLFDOO\ IRU FDUERQDWLRQ LQGXFHG FRUURVLRQ WKH WKHUPRG\QDPLF GHVFULSWLRQ RI G\QDPLFDOO\ IRU FDUERQDWLRQ LQGXFHG FRUURVLRQ WKH WKHUPRG\QDPLF GHVFULSWLRQ RI
FKORULGHLQGXFHGFRUURVLRQLVOLPLWHGWRWKHSURSDJDWLRQVWDJH7KHSURSDJDWLRQVWDJH FKORULGHLQGXFHGFRUURVLRQLVOLPLWHGWRWKHSURSDJDWLRQVWDJH7KHSURSDJDWLRQVWDJH
IRU FDUERQDWLRQ LQGXFHG FRUURVLRQ LV GHVFULEHG IRU R[\JHQULFK FRQFUHWH ZKHUHDV IRU FDUERQDWLRQ LQGXFHG FRUURVLRQ LV GHVFULEHG IRU R[\JHQULFK FRQFUHWH ZKHUHDV
SURSDJDWLRQ XQGHU FKORULGH LQGXFHG FRUURVLRQ LV GHVFULEHG IRU R[\JHQGHSULYHG FRQ SURSDJDWLRQ XQGHU FKORULGH LQGXFHG FRUURVLRQ LV GHVFULEHG IRU R[\JHQGHSULYHG FRQ
FUHWHLQRUGHUWRFRYHUERWKH[WUHPHVDQGHPSKDVLVHFHUWDLQVSHFLDOFKDUDFWHULVWLFV FUHWHLQRUGHUWRFRYHUERWKH[WUHPHVDQGHPSKDVLVHFHUWDLQVSHFLDOFKDUDFWHULVWLFV
$OWKRXJKWKHVHFRQGLWLRQVFDQEHUHJDUGHGDVVRPHZKDW³W\SLFDO´IRUFDUERQDWLRQDQG $OWKRXJKWKHVHFRQGLWLRQVFDQEHUHJDUGHGDVVRPHZKDW³W\SLFDO´IRUFDUERQDWLRQDQG
FKORULGHLQGXFHGFRUURVLRQLWVKRXOGEHUHPDUNHGWKDWJHQHUDOO\PL[HGIRUPVRIERWK FKORULGHLQGXFHGFRUURVLRQLWVKRXOGEHUHPDUNHGWKDWJHQHUDOO\PL[HGIRUPVRIERWK
LQLWLDWLRQPHFKDQLVPVLHDFRPELQDWLRQRI FDUERQDWLRQDQGFKORULGHVDVZHOODVWR LQLWLDWLRQPHFKDQLVPVLHDFRPELQDWLRQRIFDUERQDWLRQDQGFKORULGHVDVZHOODVWR
SURSDJDWLRQLHYDULRXVOHYHOVRIFRQFUHWHVDWXUDWLRQDUHJHQHUDOO\SUHVHQWLQSUDFWLFH SURSDJDWLRQLHYDULRXVOHYHOVRIFRQFUHWHVDWXUDWLRQDUHJHQHUDOO\SUHVHQWLQSUDFWLFH
:LWKUHJDUGWRWKDWWKHLQWHUFRQQHFWLRQEHWZHHQERWKLQLWLDWLRQPHFKDQLVPVVKRXOGEH :LWKUHJDUGWRWKDWWKHLQWHUFRQQHFWLRQEHWZHHQERWKLQLWLDWLRQPHFKDQLVPVVKRXOGEH
HPSKDVLVHG7KHGHJUHHRIFDUERQDWLRQLQIOXHQFHVWKHFKORULGHWKUHVKROG FI6HFWLRQ HPSKDVLVHG7KHGHJUHHRIFDUERQDWLRQLQIOXHQFHVWKHFKORULGHWKUHVKROG FI6HFWLRQ
 DQGYLFHYHUVDWKHFKORULGHFRQFHQWUDWLRQKDVDQHIIHFWRQWKHFULWLFDOS+ FI  DQGYLFHYHUVDWKHFKORULGHFRQFHQWUDWLRQKDVDQHIIHFWRQWKHFULWLFDOS+ FI
6HFWLRQ 0RUHRYHUWKHLQIOXHQFHRQFDUERQDWLRQRQWKHFKORULGHELQGLQJFD 6HFWLRQ 0RUHRYHUWKHLQIOXHQFHRQFDUERQDWLRQRQWKHFKORULGHELQGLQJFD
SDFLW\VKRXOGEHHPSKDVLVHG FI6HFWLRQ  SDFLW\VKRXOGEHHPSKDVLVHG FI6HFWLRQ 

 &DUERQDWLRQ,QGXFHG&RUURVLRQLQ2[\JHQ5LFK&RQFUHWH  &DUERQDWLRQ,QGXFHG&RUURVLRQLQ2[\JHQ5LFK&RQFUHWH


&RUURVLRQLQLWLDWLRQE\FDUERQDWLRQPLJKWQRWEHLPPHGLDWHO\REYLRXVIURPWKH3RXU &RUURVLRQLQLWLDWLRQE\FDUERQDWLRQPLJKWQRWEHLPPHGLDWHO\REYLRXVIURPWKH3RXU
EDL[GLDJUDPEXWZHWKLQNWKDWWKHPHFKDQLVPFDQEHFRQFOXVLYHO\H[SODLQHGEDVHG EDL[GLDJUDPEXWZHWKLQNWKDWWKHPHFKDQLVPFDQEHFRQFOXVLYHO\H[SODLQHGEDVHG
RQ WKH ³VWDQGDUG´ µ6(3'¶ RI WKH )H+2 V\VWHP ZLWK DQ LURQ LRQ DFWLYLW\ RI í RQ WKH ³VWDQGDUG´ µ6(3'¶ RI WKH )H+2 V\VWHP ZLWK DQ LURQ LRQ DFWLYLW\ RI í
PRO/DVVKRZQLQ)LJXUH PRO/DVVKRZQLQ)LJXUH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV

 
í
)LJXUH )H+2 µ6(3'¶ EDVHG RQ 7DEOH  DQG )HLD  PRO/ZLWK SUR )LJXUH )H+2 µ6(3'¶ EDVHG RQ 7DEOH  DQG )HLD í PRO/ZLWK SUR
SRVHGPHFKDQLVPIRUFDUERQDWLRQLQGXFHGFRUURVLRQLQVHPLVDWXUDWHG SRVHGPHFKDQLVPIRUFDUERQDWLRQLQGXFHGFRUURVLRQLQVHPLVDWXUDWHG
FRQFUHWH,GHQWLILFDWLRQRISRVVLEOHUDQJHRIµ(FRUU¶DQGS+IRU $ DY FRQFUHWH,GHQWLILFDWLRQRISRVVLEOHUDQJHRIµ(FRUU¶DQGS+IRU $ DY
HUDJHRIFDUERQVWHHOLQXQFRQWDPLQDWHGFRQFUHWH % DYHUDJHRIFDU HUDJHRIFDUERQVWHHOLQXQFRQWDPLQDWHGFRQFUHWH % DYHUDJHRIFDU
ERQ VWHHO LQ FDUERQDWHG FRQFUHWH EHIRUH FRUURVLRQ LQLWLDWLRQ &  DQ ERQ VWHHO LQ FDUERQDWHG FRQFUHWH EHIRUH FRUURVLRQ LQLWLDWLRQ &  DQ
RGLF VLWHV RI FDUERQ VWHHO LQ FDUERQDWHG FRQFUHWH DW FRUURVLRQ LQLWLD RGLF VLWHV RI FDUERQ VWHHO LQ FDUERQDWHG FRQFUHWH DW FRUURVLRQ LQLWLD
WLRQ ' DQRGLFVLWHVRIFDUERQVWHHOLQFDUERQDWHGFRQFUHWHLQFRUUR WLRQ ' DQRGLFVLWHVRIFDUERQVWHHOLQFDUERQDWHGFRQFUHWHLQFRUUR
VLRQSURSDJDWLRQDQG ( FDWKRGLFVLWHVRIFDUERQVWHHOLQFDUERQDWHG VLRQSURSDJDWLRQDQG ( FDWKRGLFVLWHVRIFDUERQVWHHOLQFDUERQDWHG
FRQFUHWHLQFRUURVLRQSURSDJDWLRQ FRQFUHWHLQFRUURVLRQSURSDJDWLRQ
$VGLVFXVVHGLQ6HFWLRQFDVH $ LQ)LJXUHFDQEHUHJDUGHGDVUHSUHVHQWLQJ $VGLVFXVVHGLQ6HFWLRQFDVH $ LQ)LJXUHFDQEHUHJDUGHGDVUHSUHVHQWLQJ
WKHS+UDQJH DURXQGS+ DQGWKHµ(FRUU¶ DURXQGP96+( RIFDUERQVWHHOLQXQ WKHS+UDQJH DURXQGS+ DQGWKHµ(FRUU¶ DURXQGP96+( RIFDUERQVWHHOLQXQ
FRQWDPLQDWHG FRQFUHWH 7KH ORZHU ERXQGDU\ RI FDVH $  PLJKW FRUUHVSRQG WR WKH FRQWDPLQDWHG FRQFUHWH 7KH ORZHU ERXQGDU\ RI FDVH $  PLJKW FRUUHVSRQG WR WKH
µ(FRUU¶LQFRQFUHWHXQGHUWKHH[SRVXUHFRQGLWLRQVZKLFKDUHPRVWFULWLFDOLQSURPRWLQJ µ(FRUU¶LQFRQFUHWHXQGHUWKHH[SRVXUHFRQGLWLRQVZKLFKDUHPRVWFULWLFDOLQSURPRWLQJ
FDUERQDWLRQLHWRUHODWLYHKXPLGLW\ FI6HFWLRQ  FDUERQDWLRQLHWRUHODWLYHKXPLGLW\ FI6HFWLRQ 
:LWKFDUERQDWLRQWKHS+RIWKHEXONFRQFUHWHFDQGURSWRYDOXHVDSSURDFKLQJQHXWUDO :LWKFDUERQDWLRQWKHS+RIWKHEXONFRQFUHWHFDQGURSWRYDOXHVDSSURDFKLQJQHXWUDO
LW\ FI6HFWLRQDQG7DEOHLQ6HFWLRQ ,QWKLVH[HPSOLILFDWLRQDEXON LW\ FI6HFWLRQDQG7DEOHLQ6HFWLRQ ,QWKLVH[HPSOLILFDWLRQDEXON
S+RIDURXQGLVFKRVHQWKDWZHDVVXPHWREHUHDVRQDEOH7KLVS+DQGUHVXOWLQJLQ S+RIDURXQGLVFKRVHQWKDWZHDVVXPHWREHUHDVRQDEOH7KLVS+DQGUHVXOWLQJLQ
FUHDVH LQ µ(FRUU¶ RI DERXW  P9 FI 6HFWLRQ   LV LQGLFDWHG E\ FDVH %  LQ WKH FUHDVH LQ µ(FRUU¶ RI DERXW  P9 FI 6HFWLRQ   LV LQGLFDWHG E\ FDVH %  LQ WKH
GLDJUDP GLDJUDP
+RZHYHUFDVHV $ DQG % GRRQO\UHSUHVHQWWKHDYHUDJHµ(FRUU¶RIFDUERQVWHHOUHLQ +RZHYHUFDVHV $ DQG % GRRQO\UHSUHVHQWWKHDYHUDJHµ(FRUU¶RIFDUERQVWHHOUHLQ
IRUFHPHQWLQFRQFUHWHDQGGRQRWUHIOHFWWKHORFDOLVHGFRQGLWLRQVRIWKHYDULRXVDQRGLF IRUFHPHQWLQFRQFUHWHDQGGRQRWUHIOHFWWKHORFDOLVHGFRQGLWLRQVRIWKHYDULRXVDQRGLF
DQG FDWKRGLF VLWHV RQ WKH FDUERQ VWHHO VXUIDFH ,Q DGGLWLRQ WR WKDW WKH EXON S+ GRHV DQG FDWKRGLF VLWHV RQ WKH FDUERQ VWHHO VXUIDFH ,Q DGGLWLRQ WR WKDW WKH EXON S+ GRHV
QRUPDOO\QRWUHSUHVHQWWKHS+DWWKHVWHHOVXUIDFH7KHORFDOLVHGFRQGLWLRQVRIWKHDQ QRUPDOO\QRWUHSUHVHQWWKHS+DWWKHVWHHOVXUIDFH7KHORFDOLVHGFRQGLWLRQVRIWKHDQ
RGLFDQGFDWKRGLFVLWHVGLIIHUWRDFHUWDLQH[WHQWZLWKUHJDUGWRERWKWKHORFDOLVHGSR RGLFDQGFDWKRGLFVLWHVGLIIHUWRDFHUWDLQH[WHQWZLWKUHJDUGWRERWKWKHORFDOLVHGSR
WHQWLDO DQG WKH ORFDOLVHG S+ GXH WR WKH LQKRPRJHQHLWLHV RI VWHHO LWVHOI FI 6HFWLRQ WHQWLDO DQG WKH ORFDOLVHG S+ GXH WR WKH LQKRPRJHQHLWLHV RI VWHHO LWVHOI FI 6HFWLRQ
 DQGPRUHLPSRUWDQWO\GXHWRWKHLQKRPRJHQHLWLHVRIWKH FRQFUHWHVWHHO LQWHU  DQGPRUHLPSRUWDQWO\GXHWRWKHLQKRPRJHQHLWLHVRIWKH FRQFUHWHVWHHO LQWHU
IDFH FI6HFWLRQ 0RUHRYHUZHDVVXPHWKDWWKH+DQG2+íSURGXFHGE\WKHDQ IDFH FI6HFWLRQ 0RUHRYHUZHDVVXPHWKDWWKH+DQG2+íSURGXFHGE\WKHDQ
RGLFDQGFDWKRGLFUHDFWLRQVLQWKHSDVVLYHVWDWHZKLFKGRQRWQHFHVVDULO\QHHGWRQHX RGLFDQGFDWKRGLFUHDFWLRQVLQWKHSDVVLYHVWDWHZKLFKGRQRWQHFHVVDULO\QHHGWRQHX
WUDOLVHHDFKRWKHU FI6HFWLRQ FRQWULEXWHWRWKHVHLQKRPRJHQHLWLHV WUDOLVHHDFKRWKHU FI6HFWLRQ FRQWULEXWHWRWKHVHLQKRPRJHQHLWLHV

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

$UDQJHRIµ(FRUU¶DQGDS+WKDWPLJKWEHREWDLQHGDWDQ DQRGLFVLWHDUHLQGLFDWHGLQ $UDQJHRIµ(FRUU¶DQGDS+WKDWPLJKWEHREWDLQHGDWDQ DQRGLFVLWHDUHLQGLFDWHGLQ


FDVH & 7KLVVLWXDWLRQOHDGVWRGHSDVVLYDWLRQLHFRUURVLRQLQLWLDWLRQZKLFKPHDQV FDVH & 7KLVVLWXDWLRQOHDGVWRGHSDVVLYDWLRQLHFRUURVLRQLQLWLDWLRQZKLFKPHDQV
LQ DFFRUGDQFH ZLWK WKH WKHRU\ SURSRVHG LQ 6HFWLRQ  WKDW WKH IRUPDWLRQ RI DFWLYH LQ DFFRUGDQFH ZLWK WKH WKHRU\ SURSRVHG LQ 6HFWLRQ  WKDW WKH IRUPDWLRQ RI DFWLYH
FRUURVLRQSURGXFWVLVIDYRXUHGRYHUWKHIRUPDWLRQRISDVVLYHSURGXFWVDWWKHORFDOLVHG FRUURVLRQSURGXFWVLVIDYRXUHGRYHUWKHIRUPDWLRQRISDVVLYHSURGXFWVDWWKHORFDOLVHG
DQRGLFVLWH FI)LJXUH 7KHFRQGLWLRQDWWKLVORFDOLVHGVLWHFDQEHGHVFULEHGE\WKH DQRGLFVLWH FI)LJXUH 7KHFRQGLWLRQDWWKLVORFDOLVHGVLWHFDQEHGHVFULEHGE\WKH
IROORZLQJUHDFWLRQPHFKDQLVP IROORZLQJUHDFWLRQPHFKDQLVP
‡ )DYRXUHGDQRGLFUHDFWLRQDWWKHORFDOLVHGGHSDVVLYDWHGVLWH ‡ )DYRXUHGDQRGLFUHDFWLRQDWWKHORFDOLVHGGHSDVVLYDWHGVLWH

 )H → )H+ + H − (( 
 = −  {} P96+( )  >@  )H → )H+ + H− (( 
 = −  {} P96+( )  >@

‡ 'RPLQDQWFDWKRGLFUHDFWLRQVZKLFKFDQWDNHSODFHRQWKHSDVVLYHOD\HU ‡ 'RPLQDQWFDWKRGLFUHDFWLRQVZKLFKFDQWDNHSODFHRQWKHSDVVLYHOD\HU

 2 + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@  2 + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@

‡ 6XSSOHPHQWDU\FDWKRGLFUHDFWLRQVWKDWFDQWDNHSODFHDWWKHORFDOLVHGGHSDVVLYDWHG ‡ 6XSSOHPHQWDU\FDWKRGLFUHDFWLRQVWKDWFDQWDNHSODFHDWWKHORFDOLVHGGHSDVVLYDWHG
VLWHVJLYHQWKDW)H2DQG)H2DUHSUHVHQW VLWHVJLYHQWKDW)H2DQG)H2DUHSUHVHQW

 )H 2 + + + + H − → )H + + +  2 (( 
 =  P96+( )  >@  )H 2 + + + + H − → )H + + +  2 (( 
 =  P96+( )  >@

 )H2  + + + + H − → )H + + +  2 (( 
 =  P96+( )  >@  )H2  + + + + H − → )H + + +  2 (( 
 =  P96+( )  >@

$VGHVFULEHGLQ6HFWLRQGHSDVVLYDWLRQLQFUHDVHVWKHUDWHRIWKHDQRGLFSURFHVVHV $VGHVFULEHGLQ6HFWLRQGHSDVVLYDWLRQLQFUHDVHVWKHUDWHRIWKHDQRGLFSURFHVVHV
ZKLFKOHDGVWRDGHFUHPHQWRIµ(FRUU¶7KHGHFUHPHQWRIµ(FRUU¶OHDGVWRDQLQFUHPHQWLQ ZKLFKOHDGVWRDGHFUHPHQWRIµ(FRUU¶7KHGHFUHPHQWRIµ(FRUU¶OHDGVWRDQLQFUHPHQWLQ
WKH QXPEHU RI DQRGLF VLWHV ZKHUH IRUPDWLRQ RI IHUURXV LRQ >@ LV IDYRXUHG RYHU WKH QXPEHU RI DQRGLF VLWHV ZKHUH IRUPDWLRQ RI IHUURXV LRQ >@ LV IDYRXUHG RYHU
IRUPDWLRQ RI SDVVLYH SURGXFWV 7KXV PRUH DQG PRUH RI WKH VXUIDFH LV GHSDVVLYDWHG IRUPDWLRQ RI SDVVLYH SURGXFWV 7KXV PRUH DQG PRUH RI WKH VXUIDFH LV GHSDVVLYDWHG
XQWLOWKHFDUERQVWHHOLVDWDS+DQGµ(FRUU¶ZKHUHIRUPDWLRQRIIHUURXVLRQLVIDYRXUHG XQWLOWKHFDUERQVWHHOLVDWDS+DQGµ(FRUU¶ZKHUHIRUPDWLRQRIIHUURXVLRQLVIDYRXUHG
RQWKHHQWLUHVWHHOVXUIDFH$QHZORZHU³HTXLOLEULXP´µ(FRUU¶ EHWZHHQWKHYDULRXVDQ RQWKHHQWLUHVWHHOVXUIDFH$QHZORZHU³HTXLOLEULXP´µ(FRUU¶ EHWZHHQWKHYDULRXVDQ
RGLFDQGFDWKRGLFHTXLOLEULXPSRWHQWLDOVLVREWDLQHG,QDFFRUGDQFHZLWK6HFWLRQ RGLFDQGFDWKRGLFHTXLOLEULXPSRWHQWLDOVLVREWDLQHG,QDFFRUGDQFHZLWK6HFWLRQ
WKLVWKHUPRG\QDPLFVFHQDULRFRUUHVSRQGVWRWKHSRWHQWLDOGURSXQGHUFDUERQDWLRQLQ WKLVWKHUPRG\QDPLFVFHQDULRFRUUHVSRQGVWRWKHSRWHQWLDOGURSXQGHUFDUERQDWLRQLQ
GXFHGFRUURVLRQ GXFHGFRUURVLRQ
,Q)LJXUHWKHFRQGLWLRQVDIWHUFRUURVLRQLQLWLDWLRQLHLQWKHSURSDJDWLRQSKDVHDUH ,Q)LJXUHWKHFRQGLWLRQVDIWHUFRUURVLRQLQLWLDWLRQLHLQWKHSURSDJDWLRQSKDVHDUH
LOOXVWUDWHGE\FDVH ' DQGFDVH ( ZKLFKUHSUHVHQWFRQGLWLRQVDWDQDQRGLFDQGDWD LOOXVWUDWHGE\FDVH ' DQGFDVH ( ZKLFKUHSUHVHQWFRQGLWLRQVDWDQDQRGLFDQGDWD
FDWKRGLFVLWHLQFRUURVLRQSURSDJDWLRQ,WFDQEHREVHUYHGWKDWWKHFRQGLWLRQVIRUFDVH FDWKRGLFVLWHLQFRUURVLRQSURSDJDWLRQ,WFDQEHREVHUYHGWKDWWKHFRQGLWLRQVIRUFDVH
'  DQG FDVH (  ZHUH FKRVHQ WR EH FORVH WR WKH WKHRUHWLFDO K\GURJHQ OLQH LQ WKH '  DQG FDVH (  ZHUH FKRVHQ WR EH FORVH WR WKH WKHRUHWLFDO K\GURJHQ OLQH LQ WKH
µ6(3'¶(YHQLIWKHK\GURJHQOLQHLVDWDKLJKHUSRWHQWLDOLQWKLVS+UDQJHZHFRQ µ6(3'¶(YHQLIWKHK\GURJHQOLQHLVDWDKLJKHUSRWHQWLDOLQWKLVS+UDQJHZHFRQ
VLGHU REWDLQLQJ D PDJQLWXGH RI µ(FRUU¶ ORZ HQRXJK IRU K\GURJHQ LRQ UHGXFWLRQ XQGHU VLGHU REWDLQLQJ D PDJQLWXGH RI µ(FRUU¶ ORZ HQRXJK IRU K\GURJHQ LRQ UHGXFWLRQ XQGHU
FDUERQDWLRQLQGXFHGFRUURVLRQWREHUDWKHUXQOLNHO\ZKHQWDNLQJLQWRDFFRXQWWKHK\ FDUERQDWLRQLQGXFHGFRUURVLRQWREHUDWKHUXQOLNHO\ZKHQWDNLQJLQWRDFFRXQWWKHK\
GURJHQRYHUSRWHQWLDO FI6HFWLRQ  GURJHQRYHUSRWHQWLDO FI6HFWLRQ 
,QSULQFLSOHWKLVLVEDVHGRQWZRQRWLRQV)LUVWO\DOVRDIWHUFRUURVLRQLQLWLDWLRQµ(FRUU¶ ,QSULQFLSOHWKLVLVEDVHGRQWZRQRWLRQV)LUVWO\DOVRDIWHUFRUURVLRQLQLWLDWLRQµ(FRUU¶
LVGHSHQGHQWRQWKHµ(¶RIR[\JHQUHGXFWLRQDVWKHGRPLQDQWFDWKRGLFUHDFWLRQZKLFK LVGHSHQGHQWRQWKHµ(¶RIR[\JHQUHGXFWLRQDVWKHGRPLQDQWFDWKRGLFUHDFWLRQZKLFK
 

'LIIHUHQWWRWKHH[HPSOLILFDWLRQEDVHGRQRUJDQLFULFKODNHZDWHUWKHUHGXFWLRQRIR[\JHQLQDONDOLQH 'LIIHUHQWWRWKHH[HPSOLILFDWLRQEDVHGRQRUJDQLFULFKODNHZDWHUWKHUHGXFWLRQRIR[\JHQLQDONDOLQH
DQGQHXWUDOHOHFWURO\WHVLVOLVWHGDVGRPLQDQWFDWKRGLFUHDFWLRQLQWKLVFDVHDVWKHS+LVQRWFRQVLG DQGQHXWUDOHOHFWURO\WHVLVOLVWHGDVGRPLQDQWFDWKRGLFUHDFWLRQLQWKLVFDVHDVWKHS+LVQRWFRQVLG
HUHGWRVLJQLILFDQWO\GURSEHORZ HUHGWRVLJQLILFDQWO\GURSEHORZ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV

DOVRLVDWKLJKHUSRWHQWLDOVDWWKLVS+ ERWKWKHR[\JHQOLQHDQGWKHK\GURJHQOLQHKDYH DOVRLVDWKLJKHUSRWHQWLDOVDWWKLVS+ ERWKWKHR[\JHQOLQHDQGWKHK\GURJHQOLQHKDYH


WKH VDPH VORSH RI í×S+ FI 6HFWLRQ  DQG )LJXUH   6HFRQGO\ D WKH VDPH VORSH RI í×S+ FI 6HFWLRQ  DQG )LJXUH   6HFRQGO\ D
UDWKHUORZR[\JHQFRQWHQWLVUHTXLUHGWRREWDLQµ(FRUU¶LQWKLVUDQJHDQGWKHDVVRFLDWHG UDWKHUORZR[\JHQFRQWHQWLVUHTXLUHGWRREWDLQµ(FRUU¶LQWKLVUDQJHDQGWKHDVVRFLDWHG
GHJUHHRIVDWXUDWLRQFRXQWHUDFWVWKHFDUERQDWLRQUDWH FI6HFWLRQ  GHJUHHRIVDWXUDWLRQFRXQWHUDFWVWKHFDUERQDWLRQUDWH FI6HFWLRQ 
$IWHUFRUURVLRQLQLWLDWLRQWKHVROXEOHLURQVSHFLHV)HLVIDYRXUHGWREHIRUPHGDWDQ $IWHUFRUURVLRQLQLWLDWLRQWKHVROXEOHLURQVSHFLHV)HLVIDYRXUHGWREHIRUPHGDWDQ
RGLF VLWHV ZKLFK ZH XQGHUVWDQG WR EH WKH PDMRU GLIIHUHQFH WR SDVVLYLW\ FI 6HFWLRQ RGLF VLWHV ZKLFK ZH XQGHUVWDQG WR EH WKH PDMRU GLIIHUHQFH WR SDVVLYLW\ FI 6HFWLRQ
 ,QFRQWUDVWWRSDVVLYLW\ZKHUHDGHQVHOD\HURILURQR[LGHVLVGLUHFWO\IRUPHG  ,QFRQWUDVWWRSDVVLYLW\ZKHUHDGHQVHOD\HURILURQR[LGHVLVGLUHFWO\IRUPHG
DQGWKHFRUURVLRQUDWHGLPLQLVKHVWKHIHUURXVLRQLVUHOHDVHGDQGDYDLODEOHIRUIXUWKHU DQGWKHFRUURVLRQUDWHGLPLQLVKHVWKHIHUURXVLRQLVUHOHDVHGDQGDYDLODEOHIRUIXUWKHU
WUDQVIRUPDWLRQV)RUR[\JHQULFKFRQFUHWHWKHVHWUDQVIRUPDWLRQVDUHRIWHQGHVFULEHG WUDQVIRUPDWLRQV)RUR[\JHQULFKFRQFUHWHWKHVHWUDQVIRUPDWLRQVDUHRIWHQGHVFULEHG
E\DWKUHHIROGPHFKDQLVPOHDGLQJWRWKHIRUPDWLRQRIK\GUDWHGKHPDWLWH>%URRPILHOG E\DWKUHHIROGPHFKDQLVPOHDGLQJWRWKHIRUPDWLRQRIK\GUDWHGKHPDWLWH>%URRPILHOG
6DQGEHUJ@ 6DQGEHUJ@
‡ )RUPDWLRQRIIHUURXVK\GUR[LGH ‡ )RUPDWLRQRIIHUURXVK\GUR[LGH

 )H  2+ − → )H 2+  ( Δ* 
−  N- )  >@  )H  2+ − → )H 2+  ( Δ* 
−  N- )  >@

‡ )RUPDWLRQRIIHUULFK\GUR[LGH ‡ )RUPDWLRQRIIHUULFK\GUR[LGH

 )H 2+   2   +  2 → )H 2+  ( Δ* 
−  N- )  >@  )H 2+   2   +  2 → )H 2+  ( Δ* 
−  N- )  >@

‡ )RUPDWLRQRIK\GUDWHGKHPDWLWH ‡ )RUPDWLRQRIK\GUDWHGKHPDWLWH

 )H 2+  → )H  2 ⋅ +  2  +  2 ( Δ* 
−  N- )  >@  )H 2+  → )H  2 ⋅ +  2  +  2 ( Δ* 
−  N- )  >@

7KH UHDFWLRQV >@ WR >@ LQ WKH GHVFULEHG WUDQVIRUPDWLRQ LOOXVWUDWH D QHJDWLYH 7KH UHDFWLRQV >@ WR >@ LQ WKH GHVFULEHG WUDQVIRUPDWLRQ LOOXVWUDWH D QHJDWLYH
µ¨*¶DQGDUHWKXVWKHUPRG\QDPLFDOO\SRVVLEOH+RZHYHUWKDWWKLVLVQRWWUXHIRUDQ µ¨*¶DQGDUHWKXVWKHUPRG\QDPLFDOO\SRVVLEOH+RZHYHUWKDWWKLVLVQRWWUXHIRUDQ
DOWHUQDWLYHGHVFULSWLRQRIWKHHOHFWURO\VLVRILURQWKDWLVRIWHQVWDWHGLQWKHOLWHUDWXUH DOWHUQDWLYHGHVFULSWLRQRIWKHHOHFWURO\VLVRILURQWKDWLVRIWHQVWDWHGLQWKHOLWHUDWXUH

)H  +  2 → )H 2+   +  ( Δ* 
 N- )  >@ )H  +  2 → )H 2+   +  ( Δ* 
 N- )  >@

&RQWUDU\WRWKHJHQHUDODEVHQFHRIGHVFULSWLRQVIRURWKHUFRUURVLRQVWDWHVWKLVUHDFWLRQ &RQWUDU\WRWKHJHQHUDODEVHQFHRIGHVFULSWLRQVIRURWKHUFRUURVLRQVWDWHVWKLVUHDFWLRQ
PHFKDQLVPLVIUHTXHQWO\FLWHGLQWKHOLWHUDWXUHDQGZHJHQHUDOO\DJUHHWRWKLVPHFKD PHFKDQLVPLVIUHTXHQWO\FLWHGLQWKHOLWHUDWXUHDQGZHJHQHUDOO\DJUHHWRWKLVPHFKD
QLVPDVRQHWKHUPRG\QDPLFRSWLRQ QLVPDVRQHWKHUPRG\QDPLFRSWLRQ
$FRQVWDQWVKLIWEHWZHHQWKHDQRGLFDQGFDWKRGLFVLWHVLVLQWURGXFHGE\WKHIRUPDWLRQ $FRQVWDQWVKLIWEHWZHHQWKHDQRGLFDQGFDWKRGLFVLWHVLVLQWURGXFHGE\WKHIRUPDWLRQ
RIK\GUR[\OLRQVDWWKHFDWKRGLFVLWHV$VLOOXVWUDWHGE\FDVH ( LQ)LJXUHµ(FRUU¶DW RIK\GUR[\OLRQVDWWKHFDWKRGLFVLWHV$VLOOXVWUDWHGE\FDVH ( LQ)LJXUHµ(FRUU¶DW
FDWKRGLF VLWHV LV LQLWLDOO\ VOLJKWO\ KLJKHU GXH WR GLIIHUHQFHV LQ R[\JHQ FRQFHQWUDWLRQV FDWKRGLF VLWHV LV LQLWLDOO\ VOLJKWO\ KLJKHU GXH WR GLIIHUHQFHV LQ R[\JHQ FRQFHQWUDWLRQV
DQG WKH LQFUHDVH LQ S+ GXH WR WKH SUHVHQFH RI K\GUR[\O LRQV :LWK FRQVXPSWLRQ RI DQG WKH LQFUHDVH LQ S+ GXH WR WKH SUHVHQFH RI K\GUR[\O LRQV :LWK FRQVXPSWLRQ RI
R[\JHQE\WKHGRPLQDQWFDWKRGLFUHDFWLRQ>@DQGFRQVXPSWLRQRIK\GUR[\OLRQVLQ R[\JHQE\WKHGRPLQDQWFDWKRGLFUHDFWLRQ>@DQGFRQVXPSWLRQRIK\GUR[\OLRQVLQ
WKHIRUPDWLRQRI IHUURXV K\GUR[LGH>@FDVH ( ZLOOHYHQWXDOO\FKDQJHWRDQRGLF WKHIRUPDWLRQRI IHUURXV K\GUR[LGH>@FDVH ( ZLOOHYHQWXDOO\FKDQJHWRDQRGLF
FRQGLWLRQLHVKLIWWRZDUGVFDVH ' ZKLOHDWDSULRUDQRGLFVLWHFDQGHYHORSFDWKRGLF FRQGLWLRQLHVKLIWWRZDUGVFDVH ' ZKLOHDWDSULRUDQRGLFVLWHFDQGHYHORSFDWKRGLF
FRQGLWLRQV7KLVFRQVWDQWVKLIWEHWZHHQDQRGLFDQGFDWKRGLFVLWHVOHDGVWRXQLIRUPFRU FRQGLWLRQV7KLVFRQVWDQWVKLIWEHWZHHQDQRGLFDQGFDWKRGLFVLWHVOHDGVWRXQLIRUPFRU
URVLRQ FI6HFWLRQ  URVLRQ FI6HFWLRQ 
7\SLFDO FRUURVLRQ SRWHQWLDOV IRU XQLIRUP FRUURVLRQ KDYH EHHQ REVHUYHG WR EH LQ WKH 7\SLFDO FRUURVLRQ SRWHQWLDOV IRU XQLIRUP FRUURVLRQ KDYH EHHQ REVHUYHG WR EH LQ WKH
UDQJHRIíWRíP96+( >$UXS@ZKLFKLVLQJRRGDJUHHPHQWZLWKWKHDY UDQJHRIíWRíP96+( >$UXS@ZKLFKLVLQJRRGDJUHHPHQWZLWKWKHDY

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

HUDJHSRWHQWLDOUDQJHEHWZHHQFDVH ' DQGFDVH ( LQWKH3RXUEDL[GLDJUDP FI)LJ HUDJHSRWHQWLDOUDQJHEHWZHHQFDVH ' DQGFDVH ( LQWKH3RXUEDL[GLDJUDP FI)LJ
XUH DQGWKHQRWLRQWKDWFDUERQDWLRQLQGXFHGFRUURVLRQGRHVJHQHUDOO\QRWLQYROYH XUH DQGWKHQRWLRQWKDWFDUERQDWLRQLQGXFHGFRUURVLRQGRHVJHQHUDOO\QRWLQYROYH
K\GURJHQLRQUHGXFWLRQ K\GURJHQLRQUHGXFWLRQ
$VPHQWLRQHGLQ6HFWLRQWKHVWDELOLW\GRPDLQVRI)H 2+ DQG)H 2+ DJUHH $VPHQWLRQHGLQ6HFWLRQWKHVWDELOLW\GRPDLQVRI)H 2+ DQG)H 2+ DJUHH
DSSUR[LPDWHO\ZLWKWKHVWDELOLW\GRPDLQVRI)H2DQG)H2UHVSHFWLYHO\7KHVWDELO DSSUR[LPDWHO\ZLWKWKHVWDELOLW\GRPDLQVRI)H2DQG)H2UHVSHFWLYHO\7KHVWDELO
LW\GRPDLQRI)H2Â+2FRUUHVSRQGVWRWKHVWDELOLW\GRPDLQRI)H26RWKHSURG LW\GRPDLQRI)H2Â+2FRUUHVSRQGVWRWKHVWDELOLW\GRPDLQRI)H26RWKHSURG
XFWVIRUPHGLQWKHPHFKDQLVPGHVFULEHGLQ>@WR>@DUHVWDEOHLQFDVH ( RQO\ XFWVIRUPHGLQWKHPHFKDQLVPGHVFULEHGLQ>@WR>@DUHVWDEOHLQFDVH ( RQO\
+RZHYHU DV GLVFXVVHG LQ 6HFWLRQ  EDVHG RQ WKH HYDOXDWLRQ RI µ¨*I¶ YDOXHV WR +RZHYHU DV GLVFXVVHG LQ 6HFWLRQ  EDVHG RQ WKH HYDOXDWLRQ RI µ¨*I¶ YDOXHV WR
FRPSDUHWKHSUREDELOLW\RIPXWXDOIRUPDWLRQDQGRQFRUURVLRQSURGXFWVGHVFULEHGLQ FRPSDUHWKHSUREDELOLW\RIPXWXDOIRUPDWLRQDQGRQFRUURVLRQSURGXFWVGHVFULEHGLQ
WKH OLWHUDWXUH ZH SRVWXODWH WKDW FDVH (  IDYRXUV WKH IRUPDWLRQ RI )H2 DQG )H2 WKH OLWHUDWXUH ZH SRVWXODWH WKDW FDVH (  IDYRXUV WKH IRUPDWLRQ RI )H2 DQG )H2
RYHU)H 2+ DQG)H 2+ UHVSHFWLYHO\6RWKHWUDQVIRUPDWLRQRIWKHGLVVROYHGIHU RYHU)H 2+ DQG)H 2+ UHVSHFWLYHO\6RWKHWUDQVIRUPDWLRQRIWKHGLVVROYHGIHU
URXV LRQ FDQ DOVR EH GHVFULEHG DV WKH LQYHUVLRQ RI WKH VXSSOHPHQWDU\ FDWKRGLF UHDF URXV LRQ FDQ DOVR EH GHVFULEHG DV WKH LQYHUVLRQ RI WKH VXSSOHPHQWDU\ FDWKRGLF UHDF
WLRQV>@DQG>@ WLRQV>@DQG>@

)H + + +  2 → )H  2 + + + + H− (( 
 =  P96+( )  >@ )H + + +  2 → )H  2 + + + + H− (( 
 =  P96+( )  >@

)H + + +  2 → )H2  + + + + H − (( 
 =  P96+( )  >@ )H + + +  2 → )H2  + + + + H − (( 
 =  P96+( )  >@

ZKLFKZHFRQVLGHUWREHWKHUPRG\QDPLFDOO\IDYRXUHG ZKLFKZHFRQVLGHUWREHWKHUPRG\QDPLFDOO\IDYRXUHG
:LWKUHJDUGWRWKHIRUPDWLRQRIK\GUDWHGKHPDWLWHLWVKRXOGEHQRWHGWKDWGLUHFWIRU :LWKUHJDUGWRWKHIRUPDWLRQRIK\GUDWHGKHPDWLWHLWVKRXOGEHQRWHGWKDWGLUHFWIRU
PDWLRQ RI )H2 µ¨*I¶  í N-PRO  LV IDYRXUHG RYHU )H2Â+2 ¨*I  í PDWLRQ RI )H2 µ¨*I¶  í N-PRO  LV IDYRXUHG RYHU )H2Â+2 ¨*I  í
N-PRO  DQG WKDW WKH IRUPDWLRQ RI )H2Â+2 IURP )H2 LV QRW WKHUPRG\QDPLFDOO\ N-PRO  DQG WKDW WKH IRUPDWLRQ RI )H2Â+2 IURP )H2 LV QRW WKHUPRG\QDPLFDOO\
IDYRXUHG IDYRXUHG

)H  2  +  2 → )H  2 ⋅ +  2 ( Δ* 
=  N- )  >@ )H  2  +  2 → )H  2 ⋅ +  2 ( Δ* 
=  N- )  >@

+RZHYHUZLWKVXIILFLHQWVXSSO\RIR[\JHQWKHIRUPDWLRQRI)H2Â+2LVWKHUPRG\ +RZHYHUZLWKVXIILFLHQWVXSSO\RIR[\JHQWKHIRUPDWLRQRI)H2Â+2LVWKHUPRG\
QDPLFDOO\IDYRXUHGDQGDVVXPHGWREHSRVVLEOHLQR[\JHQULFKFRQFUHWHHJDFFRUG QDPLFDOO\IDYRXUHGDQGDVVXPHGWREHSRVVLEOHLQR[\JHQULFKFRQFUHWHHJDFFRUG
LQJWR LQJWR

)H + + 2  + +  2 → )H  2 ⋅ +  2 + + + ( Δ* 
−  N- )  >@ )H + + 2  + +  2 → )H  2 ⋅ +  2 + + + ( Δ* 
−  N- )  >@

,QHLWKHUZD\IURPDWKHUPRG\QDPLFDOO\SRLQWRIYLHZWKHIRUPDWLRQRILURQR[LGHV ,QHLWKHUZD\IURPDWKHUPRG\QDPLFDOO\SRLQWRIYLHZWKHIRUPDWLRQRILURQR[LGHV
PXVWWDNHSODFHDWFDWKRGLFVLWHVVRWKDWWKHWUDGLWLRQDOQRWLRQRIWKHHVWDEOLVKPHQWRI PXVWWDNHSODFHDWFDWKRGLFVLWHVVRWKDWWKHWUDGLWLRQDOQRWLRQRIWKHHVWDEOLVKPHQWRI
WKHLRQLFFXUUHQWLHPLJUDWLRQRIIHUURXVLRQIURPDQRGLFWRFDWKRGLFVLWHVWRIRUPDQ WKHLRQLFFXUUHQWLHPLJUDWLRQRIIHUURXVLRQIURPDQRGLFWRFDWKRGLFVLWHVWRIRUPDQ
LURQR[LGHLVDSSOLFDEOHIRUFDUERQDWLRQLQGXFHGFRUURVLRQ:LWKUHJDUGWRWKHLRQLF LURQR[LGHLVDSSOLFDEOHIRUFDUERQDWLRQLQGXFHGFRUURVLRQ:LWKUHJDUGWRWKHLRQLF
FXUUHQWLWVKRXOGDOVREHQRWHGWKDWFXUUHQWWUDQVIHUE\³PLJUDWLRQ´RIK\GUR[\OLRQVLV FXUUHQWLWVKRXOGDOVREHQRWHGWKDWFXUUHQWWUDQVIHUE\³PLJUDWLRQ´RIK\GUR[\OLRQVLV
ODUJHO\OLPLWHGGXHWRWKHQHXWUDOLVDWLRQRIWKHFRQFUHWHEXONZKLFKUHGXFHVLWVFRQ ODUJHO\OLPLWHGGXHWRWKHQHXWUDOLVDWLRQRIWKHFRQFUHWHEXONZKLFKUHGXFHVLWVFRQ
GXFWLYLW\ FI7DEOHLQ6HFWLRQDQG6HFWLRQVDQGZLWKUHJDUGWR GXFWLYLW\ FI7DEOHLQ6HFWLRQDQG6HFWLRQVDQGZLWKUHJDUGWR
PLJUDWLRQDQGWKHLRQPRELOLW\LQFRQFUHWHUHVSHFWLYHO\ :HWKLQNWKDWDPRQJRWK PLJUDWLRQDQGWKHLRQPRELOLW\LQFRQFUHWHUHVSHFWLYHO\ :HWKLQNWKDWDPRQJRWK
HUVUHGXFHGFRQGXFWLYLW\LVDIDFWRUIRUWKHUHODWLYHO\ORZFRUURVLRQUDWHVXQGHUFDU HUVUHGXFHGFRQGXFWLYLW\LVDIDFWRUIRUWKHUHODWLYHO\ORZFRUURVLRQUDWHVXQGHUFDU
ERQDWLRQLQGXFHGFRUURVLRQFRPSDUHGWRFKORULGHLQFOXGHGFRUURVLRQ FI6HFWLRQ ERQDWLRQLQGXFHGFRUURVLRQFRPSDUHGWRFKORULGHLQFOXGHGFRUURVLRQ FI6HFWLRQ
   

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV

'LVUHJDUGLQJWKHVXSSOHPHQWDU\FDWKRGLFUHDFWLRQV>@DQG>@ZKLFKZHXQGHU 'LVUHJDUGLQJWKHVXSSOHPHQWDU\FDWKRGLFUHDFWLRQV>@DQG>@ZKLFKZHXQGHU
VWDQG WR SOD\ D UROH LQ SDVVLYLW\ HVSHFLDOO\ LQ ORZ SRWHQWLDO FRUURVLRQ FI 6HFWLRQ VWDQG WR SOD\ D UROH LQ SDVVLYLW\ HVSHFLDOO\ LQ ORZ SRWHQWLDO FRUURVLRQ FI 6HFWLRQ
 EXWWREHQHJOLJLEOHLQDFWLYHFRUURVLRQWKHWUDGLWLRQDO³IXQGDPHQWDOPHFKD  EXWWREHQHJOLJLEOHLQDFWLYHFRUURVLRQWKHWUDGLWLRQDO³IXQGDPHQWDOPHFKD
QLVP´ LV KHQFH DSSOLFDEOH IRU WKH GHVFULSWLRQ RI FDUERQDWLRQ LQGXFHG FRUURVLRQ LQ QLVP´ LV KHQFH DSSOLFDEOH IRU WKH GHVFULSWLRQ RI FDUERQDWLRQ LQGXFHG FRUURVLRQ LQ
R[\JHQULFK FRQFUHWH<HWRQFHPRUHLWVKRXOGEHHPSKDVLVHGWKDWZHFRQVLGHUWKLV R[\JHQULFK FRQFUHWH<HWRQFHPRUHLWVKRXOGEHHPSKDVLVHGWKDWZHFRQVLGHUWKLV
FRQFHSW WR EH OLPLWHG WR WKHVH FRUURVLRQ FRQGLWLRQV :H WKLQN WKDW WKH IRUPDWLRQ RI FRQFHSW WR EH OLPLWHG WR WKHVH FRUURVLRQ FRQGLWLRQV :H WKLQN WKDW WKH IRUPDWLRQ RI
)HDQGLWVPLJUDWLRQWRIRUPVROLGSURGXFWVLVWKHFHQWUDOGLIIHUHQFHEHWZHHQWKHDF )HDQGLWVPLJUDWLRQWRIRUPVROLGSURGXFWVLVWKHFHQWUDOGLIIHUHQFHEHWZHHQWKHDF
WLYHVWDWHDQGWKHSDVVLYHVWDWHZKHUHVROLGSURGXFWVDUHGLUHFWO\IRUPHGRQWKHFDU WLYHVWDWHDQGWKHSDVVLYHVWDWHZKHUHVROLGSURGXFWVDUHGLUHFWO\IRUPHGRQWKHFDU
ERQVWHHOVXUIDFH ERQVWHHOVXUIDFH
'LVUHJDUGLQJ WKH W\SH RI LURQ R[LGHV IRUPHG LQ WKH SURFHVV RI DFWLYH XQLIRUP FRUUR 'LVUHJDUGLQJ WKH W\SH RI LURQ R[LGHV IRUPHG LQ WKH SURFHVV RI DFWLYH XQLIRUP FRUUR
VLRQWKHLURQR[LGHVRFFXS\DODUJHUYROXPHWKDQWKHSXUHLURQWKDWLVFRQVXPHGLQWKH VLRQWKHLURQR[LGHVRFFXS\DODUJHUYROXPHWKDQWKHSXUHLURQWKDWLVFRQVXPHGLQWKH
FRUURVLRQUHDFWLRQHJ>+HUKROGWHWDO$ORQVRHWDO0DUFRWWH +DQV FRUURVLRQUHDFWLRQHJ>+HUKROGWHWDO$ORQVRHWDO0DUFRWWH +DQV
VRQ@7KHLQFUHDVHLQYROXPHDURXQGWKHUHEDUH[HUWVGLVUXSWLYHWHQVLOHVWUHVVRQ VRQ@7KHLQFUHDVHLQYROXPHDURXQGWKHUHEDUH[HUWVGLVUXSWLYHWHQVLOHVWUHVVRQ
WKH VXUURXQGLQJ FRQFUHWH ,I WKHVH VWUHVVHV H[FHHG WKH FRQFUHWH WHQVLOH VWUHQJWK WKH WKH VXUURXQGLQJ FRQFUHWH ,I WKHVH VWUHVVHV H[FHHG WKH FRQFUHWH WHQVLOH VWUHQJWK WKH
FRQFUHWHFUDFNVVSDOOVRUWKHFRQFUHWHFRYHUGHODPLQDWHVVHH)LJXUHGHSHQGLQJ FRQFUHWHFUDFNVVSDOOVRUWKHFRQFUHWHFRYHUGHODPLQDWHVVHH)LJXUHGHSHQGLQJ
RQWKHH[SRVXUHDVZHOODVRQWKHVWUXFWXUDOFRQGLWLRQV RQWKHH[SRVXUHDVZHOODVRQWKHVWUXFWXUDOFRQGLWLRQV

 
)LJXUH 'DPDJH W\SHV UHVXOWLQJ IURP UHLQIRUFHPHQW FRUURVLRQ LQ R[\JHQULFK )LJXUH 'DPDJH W\SHV UHVXOWLQJ IURP UHLQIRUFHPHQW FRUURVLRQ LQ R[\JHQULFK
FRQFUHWH >$@ &UDFNLQJ >%@ 6SDOOLQJ>&@ 'HODPLQDWLRQ >'@ &RP FRQFUHWH >$@ &UDFNLQJ >%@ 6SDOOLQJ >&@ 'HODPLQDWLRQ >'@ &RP
ELQDWLRQRIGDPDJHW\SHVDWFRQFUHWHEULGJH$IWHU>665@ ELQDWLRQRIGDPDJHW\SHVDWFRQFUHWHEULGJH$IWHU>665@
,WVKRXOGEHQRWHGWKDWFRUURVLRQFUDFNV VHH)LJXUH>$@ DUHRIWHQSDUDOOHOWRWKH ,WVKRXOGEHQRWHGWKDWFRUURVLRQFUDFNV VHH)LJXUH>$@ DUHRIWHQSDUDOOHOWRWKH
UHLQIRUFHPHQWDQGWKHUHIRUHTXLWHGLVWLQFWIURPORDGLQGXFHGFUDFNV UHLQIRUFHPHQWDQGWKHUHIRUHTXLWHGLVWLQFWIURPORDGLQGXFHGFUDFNV
:LWKUHJDUGWRERWKWKHH[DFWFRUURVLRQSURGXFWVIRUPHGDQGWKHUHVSHFWLYHYROXPHV :LWKUHJDUGWRERWKWKHH[DFWFRUURVLRQSURGXFWVIRUPHGDQGWKHUHVSHFWLYHYROXPHV
WKHUHVHHPWREHGLIIHUHQWQRWLRQVLQWKHOLWHUDWXUHRQUHLQIRUFHPHQWFRUURVLRQ,QWKH WKHUHVHHPWREHGLIIHUHQWQRWLRQVLQWKHOLWHUDWXUHRQUHLQIRUFHPHQWFRUURVLRQ,QWKH
H[SHULPHQWDOSDUWRIWKLVSURMHFWZHGLGQRWGHDOZLWKFDUERQDWLRQLQGXFHGFRUURVLRQ H[SHULPHQWDOSDUWRIWKLVSURMHFWZHGLGQRWGHDOZLWKFDUERQDWLRQLQGXFHGFRUURVLRQ
DQG TXDQWLILHG QHLWKHU WKH H[DFW FRPSRVLWLRQ RI WKH SURGXFWV QRU WKHLU YROXPH IRU DQG TXDQWLILHG QHLWKHU WKH H[DFW FRPSRVLWLRQ RI WKH SURGXFWV QRU WKHLU YROXPH IRU
FKORULGH LQGXFHG FRUURVLRQ <HW EDVHG RQ WKHRUHWLFDO FRQVLGHUDWLRQV ZH WKLQN WKDW FKORULGH LQGXFHG FRUURVLRQ <HW EDVHG RQ WKHRUHWLFDO FRQVLGHUDWLRQV ZH WKLQN WKDW
IRUPDWLRQ RI )H2 DQG )H2 LV IDYRXUHG RYHU IRUPDWLRQ RI )H 2+  DQG )H 2+  IRUPDWLRQ RI )H2 DQG )H2 LV IDYRXUHG RYHU IRUPDWLRQ RI )H 2+  DQG )H 2+ 
UHVSHFWLYHO\7KLVDOVRH[FOXGHVIRUPDWLRQRI)H2Â+2IURP)H2FRPELQLQJZLWK UHVSHFWLYHO\7KLVDOVRH[FOXGHVIRUPDWLRQRI)H2Â+2IURP)H2FRPELQLQJZLWK
ZDWHU ZKHUHDV WKH GLUHFW IRUPDWLRQ RI K\GUDWHG KHPDWLWH LV SRVVLEOH ZLWK VXIILFLHQW ZDWHU ZKHUHDV WKH GLUHFW IRUPDWLRQ RI K\GUDWHG KHPDWLWH LV SRVVLEOH ZLWK VXIILFLHQW
VXSSO\RIR[\JHQDVGHVFULEHGE\WKHUHGR[UHDFWLRQ>@ VXSSO\RIR[\JHQDVGHVFULEHGE\WKHUHGR[UHDFWLRQ>@

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

&RQVLGHUDWLRQVRQWKHYROXPHVRIWKHSURGXFWVDUHPDUJLQDOLQWKLVSURMHFWVLQFHZH &RQVLGHUDWLRQVRQWKHYROXPHVRIWKHSURGXFWVDUHPDUJLQDOLQWKLVSURMHFWVLQFHZH
DLP DW DYRLGLQJ FRUURVLRQ UDWKHU WKDQ FRQWUROOLQJ FRUURVLRQ SURSDJDWLRQ +RZHYHU DLP DW DYRLGLQJ FRUURVLRQ UDWKHU WKDQ FRQWUROOLQJ FRUURVLRQ SURSDJDWLRQ +RZHYHU
NQRZOHGJHRQWKHH[DFWYROXPHVDQGFRQVHTXHQWO\RQWKHDFWXDOSURGXFWVIRUPHGLV NQRZOHGJHRQWKHH[DFWYROXPHVDQGFRQVHTXHQWO\RQWKHDFWXDOSURGXFWVIRUPHGLV
FUXFLDO LQ HJ PDWKHPDWLFDO PRGHOOLQJ RI FRUURVLRQ SURSDJDWLRQ ,W DSSHDUV WKDW LQ FUXFLDO LQ HJ PDWKHPDWLFDO PRGHOOLQJ RI FRUURVLRQ SURSDJDWLRQ ,W DSSHDUV WKDW LQ
VRPH PRGHOV WKH XQGHUO\LQJ DVVXPSWLRQV IRU WKH YROXPHV RI FRUURVLRQ SURGXFWV DUH VRPH PRGHOV WKH XQGHUO\LQJ DVVXPSWLRQV IRU WKH YROXPHV RI FRUURVLRQ SURGXFWV DUH
EDVHG RQ SUHIHUHQWLDO IRUPDWLRQ RI )H2Â+2 >$QGUDGH HWDO  0ROLQD HWDO EDVHG RQ SUHIHUHQWLDO IRUPDWLRQ RI )H2Â+2 >$QGUDGH HWDO  0ROLQD HWDO
,VJRU 5D]DTSXU@%DVHGRQWKHUPRG\QDPLFVZHWKLQNWKDWWKLVDVVXPS ,VJRU 5D]DTSXU@%DVHGRQWKHUPRG\QDPLFVZHWKLQNWKDWWKLVDVVXPS
WLRQ LV LQDFFXUDWH WR VRPH H[WHQW DV ZDV DOVR LQGLFDWHG LQ >0DUFRWWH  +DQVVRQ WLRQ LV LQDFFXUDWH WR VRPH H[WHQW DV ZDV DOVR LQGLFDWHG LQ >0DUFRWWH  +DQVVRQ
@ @
)RUWKHSXUSRVHRIWKLVWKHVLVZKHUHYROXPHVRIFRUURVLRQSURGXFWVDUHPDUJLQDOZH )RUWKHSXUSRVHRIWKLVWKHVLVZKHUHYROXPHVRIFRUURVLRQSURGXFWVDUHPDUJLQDOZH
UHJDUGLWWREHVXIILFLHQWWRUHIHUWRWKHRIWHQFLWHGYDOXHVIURP>+HUKROGWHWDO@ UHJDUGLWWREHVXIILFLHQWWRUHIHUWRWKHRIWHQFLWHGYDOXHVIURP>+HUKROGWHWDO@
ZKLFKDUHOLVWHGLQ7DEOH ZKLFKDUHOLVWHGLQ7DEOH
7DEOH 9ROXPHVRIFRUURVLRQSURGXFWVEDVHGRQFPLURQ J)H 9DOXHV 7DEOH 9ROXPHVRIFRUURVLRQSURGXFWVEDVHGRQFPLURQ J)H 9DOXHV
HVWLPDWHGIURPEDUFKDUWLQ>+HUKROGWHWDO@ HVWLPDWHGIURPEDUFKDUWLQ>+HUKROGWHWDO@
)H 2+  )H 2+ 
3URGXFW )H2 )H2 )H2 )H 2+  )H 2+  3URGXFW )H2 )H2 )H2 )H 2+  )H 2+ 
Â+2 Â+2
9ROXPHUDWLR       9ROXPHUDWLR      
 
:KLOHZHSRVWXODWHWKDWWKHVLWXDWLRQLVUDWKHUGLIIHUHQWXQGHUFKORULGHLQGXFHGFRUUR :KLOHZHSRVWXODWHWKDWWKHVLWXDWLRQLVUDWKHUGLIIHUHQWXQGHUFKORULGHLQGXFHGFRUUR
VLRQ HVSHFLDOO\ LQ R[\JHQGHSULYHG FRQFUHWH ZH DVVXPH WKDW XQGHU FDUERQDWLRQ LQ VLRQ HVSHFLDOO\ LQ R[\JHQGHSULYHG FRQFUHWH ZH DVVXPH WKDW XQGHU FDUERQDWLRQ LQ
GXFHGFRUURVLRQLQR[\JHQULFKFRQFUHWHPRVWRIWKHIHUURXVLRQIRUPHGDWWKHDQRGLF GXFHGFRUURVLRQLQR[\JHQULFKFRQFUHWHPRVWRIWKHIHUURXVLRQIRUPHGDWWKHDQRGLF
VLWHVZLOOSUHFLSLWDWHDVDFHUWDLQW\SHRILURQR[LGHLQWKHYLFLQLW\RIWKHUHLQIRUFHPHQW VLWHVZLOOSUHFLSLWDWHDVDFHUWDLQW\SHRILURQR[LGHLQWKHYLFLQLW\RIWKHUHLQIRUFHPHQW
DV ORQJ DV WKH FRQFUHWH LV XQFUDFNHG %DVHG RQ WKH 3RXUEDL[ GLDJUDP LQ )LJXUH  DV ORQJ DV WKH FRQFUHWH LV XQFUDFNHG %DVHG RQ WKH 3RXUEDL[ GLDJUDP LQ )LJXUH 
WKLV FDQ EH UHDVRQHG E\ FRQVLGHULQJ WKDW WKH R[\JHQ FRQWHQW DQG S+ ZLOO DSSURDFK WKLV FDQ EH UHDVRQHG E\ FRQVLGHULQJ WKDW WKH R[\JHQ FRQWHQW DQG S+ ZLOO DSSURDFK
FRQGLWLRQVRIWKHEXONFRQFUHWHDVLQGLFDWHGE\FDVH % VRWKDWWKHIHUURXVLRQZLOO FRQGLWLRQVRIWKHEXONFRQFUHWHDVLQGLFDWHGE\FDVH % VRWKDWWKHIHUURXVLRQZLOO
SUHFLSLWDWH DV DQ LURQ R[LGH LH DV )H2 DFFRUGLQJ WR WKH SURSRVHG FRQFHSW RI WKH SUHFLSLWDWH DV DQ LURQ R[LGH LH DV )H2 DFFRUGLQJ WR WKH SURSRVHG FRQFHSW RI WKH
GRPLQDQWVSHFLHV+RZHYHULQFDVHVZKHUHWKHFRQFUHWHLVVDWXUDWHGWKHIHUURXVLRQ GRPLQDQWVSHFLHV+RZHYHULQFDVHVZKHUHWKHFRQFUHWHLVVDWXUDWHGWKHIHUURXVLRQ
FRXOGVWD\LQVROXWLRQDQGGLIIXVHWRZDUGVWKHVXUIDFHRULQWKHGLUHFWLRQRIDQHOHFWUL FRXOGVWD\LQVROXWLRQDQGGLIIXVHWRZDUGVWKHVXUIDFHRULQWKHGLUHFWLRQRIDQHOHFWUL
FDOILHOGHJLQWKHFDVHRIPDFURFHOOFRUURVLRQ FDOILHOGHJLQWKHFDVHRIPDFURFHOOFRUURVLRQ
&RQWURORIFDUERQDWLRQLQGXFHGFRUURVLRQLVGHDOWZLWKLQ&KDSWHUVDQGZLWKUHJDUG &RQWURORIFDUERQDWLRQLQGXFHGFRUURVLRQLVGHDOWZLWKLQ&KDSWHUVDQGZLWKUHJDUG
WRDYDLODEOHDQGWKHSURSRVHGQHZFRXQWHUPHDVXUHVUHVSHFWLYHO\ WRDYDLODEOHDQGWKHSURSRVHGQHZFRXQWHUPHDVXUHVUHVSHFWLYHO\

 &KORULGH,QGXFHG&RUURVLRQLQ2[\JHQ'HSULYHG&RQFUHWH  &KORULGH,QGXFHG&RUURVLRQLQ2[\JHQ'HSULYHG&RQFUHWH


$VPHQWLRQHGLQ6HFWLRQWKHLQLWLDWLRQRIFKORULGHLQGXFHGFRUURVLRQLVODUJHO\ $VPHQWLRQHGLQ6HFWLRQWKHLQLWLDWLRQRIFKORULGHLQGXFHGFRUURVLRQLVODUJHO\
GHSHQGHQWRQNLQHWLFSDUDPHWHUVDQGFDQQRWEHDVVHVVHGE\WKHUPRG\QDPLFFRQVLGHUD GHSHQGHQWRQNLQHWLFSDUDPHWHUVDQGFDQQRWEHDVVHVVHGE\WKHUPRG\QDPLFFRQVLGHUD
WLRQV RQO\ +RZHYHU ZH WKLQN WKDW WKH HIIHFW RI FKORULGHV GXULQJ WKH SURSDJDWLRQ WLRQV RQO\ +RZHYHU ZH WKLQN WKDW WKH HIIHFW RI FKORULGHV GXULQJ WKH SURSDJDWLRQ
VWDJHFDQEHWKHUPRG\QDPLFDOO\DVVHVVHGDQGUHSUHVHQWHGE\DFRPELQDWLRQRIWKH)H VWDJHFDQEHWKHUPRG\QDPLFDOO\DVVHVVHGDQGUHSUHVHQWHGE\DFRPELQDWLRQRIWKH)H
&O+2 µ0(3'¶ DQG DVVRFLDWHG UHDFWLRQ PHFKDQLVPV $PRQJ RWKHUV ZH WKLQN WKDW &O+2 µ0(3'¶ DQG DVVRFLDWHG UHDFWLRQ PHFKDQLVPV $PRQJ RWKHUV ZH WKLQN WKDW
WKH SURSRVHG PRGHO HQDEOHV XV WR XQGHUVWDQG ZK\ FRUURVLRQ UDWHV DUH VLJQLILFDQWO\ WKH SURSRVHG PRGHO HQDEOHV XV WR XQGHUVWDQG ZK\ FRUURVLRQ UDWHV DUH VLJQLILFDQWO\
KLJKHU XQGHU FKORULGH LQGXFHG FRUURVLRQ WKDQ XQGHU FDUERQDWLRQ LQGXFHG FRUURVLRQ KLJKHU XQGHU FKORULGH LQGXFHG FRUURVLRQ WKDQ XQGHU FDUERQDWLRQ LQGXFHG FRUURVLRQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV

HJE\DIDFWRURIDERXW FI6HFWLRQ $QGHYHQPRUHLPSRUWDQWO\ZHFRQ HJE\DIDFWRURIDERXW FI6HFWLRQ $QGHYHQPRUHLPSRUWDQWO\ZHFRQ


VLGHUWKDWDWKHUPRG\QDPLFDVVHVVPHQWHQDEOHVXVWRGHVLJQVSHFLILFWDUJHWHGPHDV VLGHUWKDWDWKHUPRG\QDPLFDVVHVVPHQWHQDEOHVXVWRGHVLJQVSHFLILFWDUJHWHGPHDV
XUHVWKDWDUHDEOHWRFRXQWHUDFWWKHFRUURVLRQSURFHVVHV XUHVWKDWDUHDEOHWRFRXQWHUDFWWKHFRUURVLRQSURFHVVHV
%HIRUHWKHSURSRVHGPRGHOIRUWKHGHVFULSWLRQRIFRUURVLRQSURSDJDWLRQXQGHUFKORULGH %HIRUHWKHSURSRVHGPRGHOIRUWKHGHVFULSWLRQRIFRUURVLRQSURSDJDWLRQXQGHUFKORULGH
LQGXFHGFRUURVLRQLVGLVFXVVHGLQGHWDLOWKHSUHVHQWXQGHUVWDQGLQJRIFRUURVLRQLQLWLD LQGXFHGFRUURVLRQLVGLVFXVVHGLQGHWDLOWKHSUHVHQWXQGHUVWDQGLQJRIFRUURVLRQLQLWLD
WLRQDQGSURSDJDWLRQLQFKORULGHFRQWDPLQDWHGFRQFUHWHLVUHYLHZHG WLRQDQGSURSDJDWLRQLQFKORULGHFRQWDPLQDWHGFRQFUHWHLVUHYLHZHG
$V GHVFULEHG LQ 6HFWLRQ  FKORULGH LRQV WULJJHU WKH GLVVROXWLRQ RI WKH SDVVLYH $V GHVFULEHG LQ 6HFWLRQ  FKORULGH LRQV WULJJHU WKH GLVVROXWLRQ RI WKH SDVVLYH
OD\HU 7KH DWWDFN VWDUWV ZLWK SLWWLQJ FRUURVLRQ FI 6HFWLRQ   DW D VLWH ZKHUH WKH OD\HU 7KH DWWDFN VWDUWV ZLWK SLWWLQJ FRUURVLRQ FI 6HFWLRQ   DW D VLWH ZKHUH WKH
SDVVLYHOD\HULVPRVWYXOQHUDEOH9XOQHUDEOHVLWHVPD\EHFDXVHGE\WKHKHWHURJHQHLW\ SDVVLYHOD\HULVPRVWYXOQHUDEOH9XOQHUDEOHVLWHVPD\EHFDXVHGE\WKHKHWHURJHQHLW\
RIWKHVWHHOLWVHOI FI6HFWLRQ EXWUHVHDUFKVKRZHGWKDWYRLGVRUGHIHFWVDWWKH RIWKHVWHHOLWVHOI FI6HFWLRQ EXWUHVHDUFKVKRZHGWKDWYRLGVRUGHIHFWVDWWKH
FRQFUHWHVWHHO LQWHUIDFH FI 6HFWLRQ   DUH SDUWLFXODUO\ YXOQHUDEOH WR FKORULGH LQ FRQFUHWHVWHHO LQWHUIDFH FI 6HFWLRQ   DUH SDUWLFXODUO\ YXOQHUDEOH WR FKORULGH LQ
GXFHG FRUURVLRQ HJ >*ODVV  %XHQIHOG  %XHQIHOG HWDO  1\JDDUG  GXFHG FRUURVLRQ HJ >*ODVV  %XHQIHOG  %XHQIHOG HWDO  1\JDDUG 
*HLNHU@0RUHRYHUZHWKLQNWKDWORFDOLVHGFRQFHQWUDWLRQGLIIHUHQFHVDQGSRWHQ *HLNHU@0RUHRYHUZHWKLQNWKDWORFDOLVHGFRQFHQWUDWLRQGLIIHUHQFHVDQGSRWHQ
WLDOGLIIHUHQFHVDORQJWKHFRQFUHWHVWHHOLQWHUIDFHGXHWRWKHGLIIHUHQWSURGXFWVIRUPHG WLDOGLIIHUHQFHVDORQJWKHFRQFUHWHVWHHOLQWHUIDFHGXHWRWKHGLIIHUHQWSURGXFWVIRUPHG
E\ WKH DQRGLF DQG FDWKRGLF UHDFWLRQV LQ WKH SDVVLYH VWDWH FI 6HFWLRQ   KDYH D E\ WKH DQRGLF DQG FDWKRGLF UHDFWLRQV LQ WKH SDVVLYH VWDWH FI 6HFWLRQ   KDYH D
FRQVLGHUDEOHHIIHFWRQWKHIRUPDWLRQRIYXOQHUDEOHVLWHVDVZHOODVRQWKHGLIIXVLRQRI FRQVLGHUDEOHHIIHFWRQWKHIRUPDWLRQRIYXOQHUDEOHVLWHVDVZHOODVRQWKHGLIIXVLRQRI
FKORULGHLRQVGXULQJWKHLQLWLDWLRQVWDJH)RULQVWDQFHDQRGLFVLWHVZLOODWWUDFWFKORULGH FKORULGHLRQVGXULQJWKHLQLWLDWLRQVWDJH)RULQVWDQFHDQRGLFVLWHVZLOODWWUDFWFKORULGH
LRQVDQGWKXVH[SHULHQFHKLJKHUFRQFHQWUDWLRQVGXHWRWKHLQIOXHQFHRQWKHPLJUDWLRQ LRQVDQGWKXVH[SHULHQFHKLJKHUFRQFHQWUDWLRQVGXHWRWKHLQIOXHQFHRQWKHPLJUDWLRQ
RIDQLRQV FI6HFWLRQ  RIDQLRQV FI6HFWLRQ 
6LPLODU WR WKH LQFRPSOHWH XQGHUVWDQGLQJ RI WKH H[DFW PHFKDQLVPV IRU WKH HVWDEOLVK 6LPLODU WR WKH LQFRPSOHWH XQGHUVWDQGLQJ RI WKH H[DFW PHFKDQLVPV IRU WKH HVWDEOLVK
PHQWRISDVVLYHOD\HUVRQPHWDOV FI 6HFWLRQ   WKH GHWDLOHG PHFKDQLVPV RI WKH PHQW RISDVVLYH OD\HUV RQ PHWDOV FI 6HFWLRQ   WKH GHWDLOHG PHFKDQLVPV RI WKH
EUHDNGRZQRIWKHSDVVLYHOD\HUE\FKORULGHLRQVDSSHDUWREHQRWIXOO\XQGHUVWRRGWR EUHDNGRZQRIWKHSDVVLYHOD\HUE\FKORULGHLRQVDSSHDUWREHQRWIXOO\XQGHUVWRRGWR
GDWH,QSULQFLSOHWKHUHDUHWKUHHWKHRULHVWRH[SODLQWKHHIIHFWRIFKORULGHLRQVRQLQL GDWH,QSULQFLSOHWKHUHDUHWKUHHWKHRULHVWRH[SODLQWKHHIIHFWRIFKORULGHLRQVRQLQL
WLDWLRQRIFRUURVLRQ>)ROH\$&,5@ WLDWLRQRIFRUURVLRQ>)ROH\$&,5@
‡ 2[LGHILOPWKHRU\ ‡ 2[LGHILOPWKHRU\
‡ $GVRUSWLRQWKHRU\ ‡ $GVRUSWLRQWKHRU\
‡ 7UDQVLWRU\FRPSOH[WKHRU\ ‡ 7UDQVLWRU\FRPSOH[WKHRU\
$GHWDLOHGGHVFULSWLRQRIWKHSRVWXODWHGPHFKDQLVPJRHVEH\RQGWKHVFRSHRIWKLVWKH $GHWDLOHGGHVFULSWLRQRIWKHSRVWXODWHGPHFKDQLVPJRHVEH\RQGWKHVFRSHRIWKLVWKH
VLV DQG UHIHUHQFH LV PDGH WR WKH OLWHUDWXUH >$&, 5 @ SURYLGHV D VKRUW VXP VLV DQG UHIHUHQFH LV PDGH WR WKH OLWHUDWXUH >$&, 5 @ SURYLGHV D VKRUW VXP
PDU\RQWKLVWKHRULHVDQGDQH[WHQVLYHUHYLHZRIWKHVHK\SRWKHVHVFDQEHIRXQGLQHJ PDU\RQWKLVWKHRULHVDQGDQH[WHQVLYHUHYLHZRIWKHVHK\SRWKHVHVFDQEHIRXQGLQHJ
>)ROH\@ >)ROH\@
$V PHQWLRQHG LQ 6HFWLRQ  WKH EUHDNGRZQ RI WKH SDVVLYH OD\HU LV JHQHUDOO\ DV $V PHQWLRQHG LQ 6HFWLRQ  WKH EUHDNGRZQ RI WKH SDVVLYH OD\HU LV JHQHUDOO\ DV
VHVVHGE\WKHSLWWLQJSRWHQWLDOµ(SLW¶ZKLFKDOVRGHWHUPLQHVWKHFKORULGHWKUHVKROG FI VHVVHGE\WKHSLWWLQJSRWHQWLDOµ(SLW¶ZKLFKDOVRGHWHUPLQHVWKHFKORULGHWKUHVKROG FI
6HFWLRQ 7KHSUHVHQFHRIFKORULGHLRQVLQFRQFUHWHOHDGVWRFKDQJHVRIWKHDQ 6HFWLRQ 7KHSUHVHQFHRIFKORULGHLRQVLQFRQFUHWHOHDGVWRFKDQJHVRIWKHDQ
RGLFEHKDYLRXURIWKHHPEHGGHGVWHHOZKLFKODUJHO\LQWHUIHUHVZLWKWKHDQRGLFSRODUL RGLFEHKDYLRXURIWKHHPEHGGHGVWHHOZKLFKODUJHO\LQWHUIHUHVZLWKWKHDQRGLFSRODUL
VDWLRQ FXUYH FI )LJXUH  LQ 6HFWLRQ   7KHSDVVLYLW\ UDQJH LVUHGXFHG LH LWV VDWLRQ FXUYH FI )LJXUH  LQ 6HFWLRQ   7KHSDVVLYLW\ UDQJH LVUHGXFHG LH LWV
XSSHUOLPLWµ(SLW¶GHFUHDVHVZLWKLQFUHDVLQJFKORULGHFRQWHQW6RWKHSDVVLYLW\UDQJHLV XSSHUOLPLWµ(SLW¶GHFUHDVHVZLWKLQFUHDVLQJFKORULGHFRQWHQW6RWKHSDVVLYLW\UDQJHLV
UHGXFHG IURP FRUURVLRQ SRWHQWLDOV UHSUHVHQWLQJ R[\JHQ HYROXWLRQ LQ XQFRQWDPLQDWHG UHGXFHG IURP FRUURVLRQ SRWHQWLDOV UHSUHVHQWLQJ R[\JHQ HYROXWLRQ LQ XQFRQWDPLQDWHG

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

FRQFUHWH FI 6HFWLRQ   WR YDOXHV RI í P96+( DQG EHORZ LQ FRQFUHWH ZLWK FRQFUHWH FI 6HFWLRQ   WR YDOXHV RI í P96+( DQG EHORZ LQ FRQFUHWH ZLWK
KLJKFKORULGHFRQFHQWUDWLRQV>3DJH 7UHDGDZD\@ KLJKFKORULGHFRQFHQWUDWLRQV>3DJH 7UHDGDZD\@
$VPHQWLRQHGLQ6HFWLRQRQHZD\RIXQGHUVWDQGLQJWKHFKORULGHWKUHVKROGLVWR $VPHQWLRQHGLQ6HFWLRQRQHZD\RIXQGHUVWDQGLQJWKHFKORULGHWKUHVKROGLVWR
UHODWHLWWRD JLYHQSRWHQWLDORIWKHVWHHOLHWKH KLJKHVWFKORULGHFRQWHQW FRPSDWLEOH UHODWHLWWRD JLYHQSRWHQWLDORIWKHVWHHOLHWKH KLJKHVWFKORULGHFRQWHQW FRPSDWLEOH
ZLWK FRQGLWLRQV RI SDVVLYLW\ DW WKDW SRWHQWLDO )RU FRQFUHWH VWUXFWXUHV H[SRVHG WR WKH ZLWK FRQGLWLRQV RI SDVVLYLW\ DW WKDW SRWHQWLDO )RU FRQFUHWH VWUXFWXUHV H[SRVHG WR WKH
DWPRVSKHUHµ(FRUU¶RIWKHHPEHGGHGVWHHOFDQEHDVVXPHGWREHDWDURXQG96+(DQG DWPRVSKHUHµ(FRUU¶RIWKHHPEHGGHGVWHHOFDQEHDVVXPHGWREHDWDURXQG96+(DQG
WKH FKORULGH WKUHVKROG LV QRUPDOO\ LQ WKH UDQJH RI  WR  µZZFH¶ FI 6HFWLRQ WKH FKORULGH WKUHVKROG LV QRUPDOO\ LQ WKH UDQJH RI  WR  µZZFH¶ FI 6HFWLRQ
  )RU VXEPHUJHG VWUXFWXUHV RU PHPEHUV WKH UHLQIRUFHPHQW VWHHO LV DW D PXFK   )RU VXEPHUJHG VWUXFWXUHV RU PHPEHUV WKH UHLQIRUFHPHQW VWHHO LV DW D PXFK
ORZHUSRWHQWLDOHJDURXQGíWRíP96+(RUIRUUHLQIRUFHPHQWWKDWLVFDWKRGL ORZHUSRWHQWLDOHJDURXQGíWRíP96+(RUIRUUHLQIRUFHPHQWWKDWLVFDWKRGL
FDOO\SRODULVHGIRUDQ\UHDVRQWKHFKORULGHWKUHVKROGFDQEHPXFKKLJKHU FDOO\SRODULVHGIRUDQ\UHDVRQWKHFKORULGHWKUHVKROGFDQEHPXFKKLJKHU
3LWWLQJFRUURVLRQLVOLNHO\WRGHYHORSLQFRQFUHWHZLWKDKLJKFRQGXFWLYLW\KLJKDOND 3LWWLQJFRUURVLRQLVOLNHO\WRGHYHORSLQFRQFUHWHZLWKDKLJKFRQGXFWLYLW\KLJKDOND
OLQLW\LHXQFDUERQDWHGDQGDFRQFHQWUDWLRQRIFKORULGHLRQVLQH[FHVVRIWKHWKUHVK OLQLW\LHXQFDUERQDWHGDQGDFRQFHQWUDWLRQRIFKORULGHLRQVLQH[FHVVRIWKHWKUHVK
ROGYDOXH7KHUHIRUHSLWWLQJFRUURVLRQFDQEHUHJDUGHGDVDFKORULGHLQGXFHGFRUURVLRQ ROGYDOXH7KHUHIRUHSLWWLQJFRUURVLRQFDQEHUHJDUGHGDVDFKORULGHLQGXFHGFRUURVLRQ
SKHQRPHQRQ$QDSSURDFKWRLPSOHPHQWWKHNLQHWLFSDUDPHWHUµ(SLW¶LQWKH3RXUEDL[ SKHQRPHQRQ$QDSSURDFKWRLPSOHPHQWWKHNLQHWLFSDUDPHWHU µ(SLW¶LQWKH3RXUEDL[
GLDJUDP LV VKRZQ LQ )LJXUH  >$@ ZKLFK LOOXVWUDWHV WKH GHSHQGHQF\ RI WKH SLWWLQJ GLDJUDP LV VKRZQ LQ )LJXUH  >$@ ZKLFK LOOXVWUDWHV WKH GHSHQGHQF\ RI WKH SLWWLQJ
SRWHQWLDORQWKHS+DQGRQFKORULGHFRQFHQWUDWLRQE\VXSHULPSRVLQJFXUYHV DVIXQF SRWHQWLDORQWKHS+DQGRQFKORULGHFRQFHQWUDWLRQE\VXSHULPSRVLQJFXUYHV DVIXQF
WLRQRIWKHS+ RQWKHµ6(3'¶ RIWKH)H+2V\VWHP7KHVHFXUYHVDUHUHIHUUHGWRDV WLRQRIWKHS+ RQWKHµ6(3'¶ RIWKH)H+2V\VWHP7KHVHFXUYHVDUHUHIHUUHGWRDV
SLWWLQJSRWHQWLDOFXUYHVLQWKHSUHVHQWWKHVLV SLWWLQJSRWHQWLDOFXUYHVLQWKHSUHVHQWWKHVLV

 
)LJXUH >$@ )H+2 µ6(3'¶ EDVHG RQ 7DEOH  DQG )HLD  í PRO/ ZLWK )LJXUH >$@ )H+2 µ6(3'¶ EDVHG RQ 7DEOH  DQG )HLD  í PRO/ ZLWK
VXSHULPSRVHGSLWWLQJSRWHQWLDOFXUYHVIRUGLIIHUHQWFKORULGHFRQFHQWUD VXSHULPSRVHGSLWWLQJSRWHQWLDOFXUYHVIRUGLIIHUHQWFKORULGHFRQFHQWUD
WLRQV&OSLWLD íPRO/&OSLWLD íPRO/DQG&OSLWLD PRO/ WLRQV&OSLWLD íPRO/&OSLWLD íPRO/DQG&OSLWLD PRO/
$IWHU >1LOVVRQ HWDO  6DQGEHUJ @ >%@ )H+2 µ6(3'¶ $IWHU >1LOVVRQ HWDO  6DQGEHUJ @ >%@ )H+2 µ6(3'¶
EDVHGRQ7DEOHDQG)HLD í PRO/ZLWKDGGLWLRQDOVHOHFWLRQRI EDVHGRQ7DEOHDQG)HLD í PRO/ZLWKDGGLWLRQDOVHOHFWLRQRI
)H2í'LDJUDP>%@LVIRUH[HPSOLILFDWLRQSXUSRVHVRQO\DQGGRHVQRW )H2í'LDJUDP>%@LVIRUH[HPSOLILFDWLRQSXUSRVHVRQO\DQGGRHVQRW
UHSUHVHQWDFWXDOFRQGLWLRQV UHSUHVHQWDFWXDOFRQGLWLRQV
$WFRUURVLRQSRWHQWLDOVKLJKHUWKDQµ(SLW¶WKHFKORULGHLRQVLQGXFHWKHORFDOLVHGEUHDN $WFRUURVLRQSRWHQWLDOVKLJKHUWKDQµ(SLW¶WKHFKORULGHLRQVLQGXFHWKHORFDOLVHGEUHDN
GRZQRIWKHSDVVLYHOD\HU)RUHOHFWURGHSRWHQWLDOVEHORZµ(SLW¶WKHDFWLRQRIFKORULGH GRZQRIWKHSDVVLYHOD\HU)RUHOHFWURGHSRWHQWLDOVEHORZµ(SLW¶WKHDFWLRQRIFKORULGH

 

$3RXUEDL[GLDJUDPZLWKVXSHULPSRVHGSLWWLQJSRWHQWLDOFXUYHVLVQRWUHIHUUHGWRDVµ0(3'¶LQWKLV $3RXUEDL[GLDJUDPZLWKVXSHULPSRVHGSLWWLQJSRWHQWLDOFXUYHVLVQRWUHIHUUHGWRDVµ0(3'¶LQWKLV
WKHVLVVLQFHWKHFXUYHVQHLWKHUUHSUHVHQWWKHUPRG\QDPLFSDUDPHWHUVQRUFDQWKH\EHGHWHUPLQHGE\ WKHVLVVLQFHWKHFXUYHVQHLWKHUUHSUHVHQWWKHUPRG\QDPLFSDUDPHWHUVQRUFDQWKH\EHGHWHUPLQHGE\
WKHUPRG\QDPLFV DORQH  FI6HFWLRQ  WKHUPRG\QDPLFV DORQH  FI6HFWLRQ 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV

LV LQ SULQFLSOH QHJOLJLEOH &RQVLGHULQJ D FRQVWDQW FKORULGH FRQWHQW LW FDQ EH FRQ LV LQ SULQFLSOH QHJOLJLEOH &RQVLGHULQJ D FRQVWDQW FKORULGH FRQWHQW LW FDQ EH FRQ
FOXGHG IURP )LJXUH  >$@ WKDW µ(SLW¶ GHFUHDVHV ZLWK GHFUHDVLQJ S+ ZKLFK FRUUH FOXGHG IURP )LJXUH  >$@ WKDW µ(SLW¶ GHFUHDVHV ZLWK GHFUHDVLQJ S+ ZKLFK FRUUH
VSRQGVWRWKHJHQHUDOWKHUPRG\QDPLFFKDUDFWHULVWLFVRIVWHHOLHKLJKHUFRUURVLRQULVN VSRQGVWRWKHJHQHUDOWKHUPRG\QDPLFFKDUDFWHULVWLFVRIVWHHOLHKLJKHUFRUURVLRQULVN
DQGUDWHZLWKGHFUHDVLQJS+ FI6HFWLRQ :HJHQHUDOO\DJUHHZLWKWKHGHVFULS DQGUDWHZLWKGHFUHDVLQJS+ FI6HFWLRQ :HJHQHUDOO\DJUHHZLWKWKHGHVFULS
WLRQRIFRQGLWLRQVIRULQLWLDWLRQRIFRUURVLRQE\VXSHULPSRVLQJSLWWLQJSRWHQWLDOFXUYHV WLRQRIFRQGLWLRQVIRULQLWLDWLRQRIFRUURVLRQE\VXSHULPSRVLQJSLWWLQJSRWHQWLDOFXUYHV
RQ D 3RXUEDL[ GLDJUDP DV SURSRVHG LQ HJ >1LOVVRQ HWDO  6DQGEHUJ @ RQ D 3RXUEDL[ GLDJUDP DV SURSRVHG LQ HJ >1LOVVRQ HWDO  6DQGEHUJ @
<HW DV PHQWLRQHG LQ SUDFWLFH µ(SLW¶ LV GHSHQGHQW RQ YDULRXV SDUDPHWHUV FRQFHUQLQJ <HW DV PHQWLRQHG LQ SUDFWLFH µ(SLW¶ LV GHSHQGHQW RQ YDULRXV SDUDPHWHUV FRQFHUQLQJ
WKHFRQFUHWHDQGVWHHO LQSDUWLFXODURQWKHFRQGLWLRQVDWWKHFRQFUHWHVWHHOLQWHUIDFH WKHFRQFUHWHDQGVWHHO LQSDUWLFXODURQWKHFRQGLWLRQVDWWKHFRQFUHWHVWHHOLQWHUIDFH
FI6HFWLRQ DQGRQWKHPHDVXUHPHQWLHPDLQO\WKHVFDQUDWHGXULQJSRODULVDWLRQ FI6HFWLRQ DQGRQWKHPHDVXUHPHQWLHPDLQO\WKHVFDQUDWHGXULQJSRODULVDWLRQ
FI 6HFWLRQ   1HYHUWKHOHVV LW VKRXOG EH NHSW LQ PLQG WKDW DOVR 3RXUEDL[ GLD FI 6HFWLRQ   1HYHUWKHOHVV LW VKRXOG EH NHSW LQ PLQG WKDW DOVR 3RXUEDL[ GLD
JUDPVIRUWKHFRQFUHWHVWHHOV\VWHPDUHHVWDEOLVKHGRQDQDSSUR[LPDWHEDVLV FI6HF JUDPVIRUWKHFRQFUHWHVWHHOV\VWHPDUHHVWDEOLVKHGRQDQDSSUR[LPDWHEDVLV FI6HF
WLRQ  WLRQ 
)LJXUH>$@H[HPSOLILHVKRZSLWWLQJSRWHQWLDOFXUYHVDUHSURMHFWHGRQWKH)H+2 )LJXUH>$@H[HPSOLILHVKRZSLWWLQJSRWHQWLDOFXUYHVDUHSURMHFWHGRQWKH)H+2
µ6(3'¶LQWKHOLWHUDWXUH>1LOVVRQHWDO6DQGEHUJ@:HFRQVLGHUWKLVWREH µ6(3'¶LQWKHOLWHUDWXUH>1LOVVRQHWDO6DQGEHUJ@:HFRQVLGHUWKLVWREH
WKHUPRG\QDPLFDOO\ LQFRQVLVWHQW WR VRPH H[WHQW VLQFH FKORULGH DQG DFFRUGLQJO\ WKH WKHUPRG\QDPLFDOO\ LQFRQVLVWHQW WR VRPH H[WHQW VLQFH FKORULGH DQG DFFRUGLQJO\ WKH
IRUPDWLRQ RI LURQFKORULGH FRPSRXQGV  LV QRW WDNHQ LQWR DFFRXQW LQ WKH XQGHUO\LQJ IRUPDWLRQ RI LURQFKORULGH FRPSRXQGV  LV QRW WDNHQ LQWR DFFRXQW LQ WKH XQGHUO\LQJ
GLDJUDP$QLPSRUWDQWWKHUPRG\QDPLFDVSHFWRIWKH)H&O+2V\VWHPLHWKHHIIHFW GLDJUDP$QLPSRUWDQWWKHUPRG\QDPLFDVSHFWRIWKH)H&O+2V\VWHPLHWKHHIIHFW
RIFKORULGHRQWKHVWDELOLW\GRPDLQVRILURQLVQRWUHIOHFWHGDQGQRUHSUHVHQWDWLYHLQ RIFKORULGHRQWKHVWDELOLW\GRPDLQVRILURQLVQRWUHIOHFWHGDQGQRUHSUHVHQWDWLYHLQ
IRUPDWLRQRQFRUURVLRQSURSDJDWLRQFDQEHREWDLQHG IRUPDWLRQRQFRUURVLRQSURSDJDWLRQFDQEHREWDLQHG
,Q)LJXUH>$@LWFDQDOVREHREVHUYHGWKDWLQFRQWUDVWWRFDUERQDWLRQLQGXFHGFRU ,Q)LJXUH>$@LWFDQDOVREHREVHUYHGWKDWLQFRQWUDVWWRFDUERQDWLRQLQGXFHGFRU
URVLRQ ZKHUH D ³JOREDO´ S+ GURS WDNHV SODFH FI 6HFWLRQ   DFWLYH FRUURVLRQ URVLRQ ZKHUH D ³JOREDO´ S+ GURS WDNHV SODFH FI 6HFWLRQ   DFWLYH FRUURVLRQ
DIWHUGHSDVVLYDWLRQLVQRWWKHUPRG\QDPLFDOO\IDYRXUHGLQWKHV\VWHPUHIOHFWHGE\WKH DIWHUGHSDVVLYDWLRQLVQRWWKHUPRG\QDPLFDOO\IDYRXUHGLQWKHV\VWHPUHIOHFWHGE\WKH
)H+2µ6(3'¶7KLVPLVPDWFKLVXQGHUOLQHGE\DSDUWLFXODUUHLQIRUFHPHQWFRUURVLRQ )H+2µ6(3'¶7KLVPLVPDWFKLVXQGHUOLQHGE\DSDUWLFXODUUHLQIRUFHPHQWFRUURVLRQ
SKHQRPHQRQ8QGHUFKORULGHLQGXFHGFRUURVLRQLQR[\JHQGHSULYHGFRQFUHWHIRUPD SKHQRPHQRQ8QGHUFKORULGHLQGXFHGFRUURVLRQLQR[\JHQGHSULYHGFRQFUHWHIRUPD
WLRQRIUXVWVWDLQVRQWKHFRQFUHWHVXUIDFHLVREVHUYHG8QGRXEWHGO\VXFKVWDLQVUHVXOW WLRQRIUXVWVWDLQVRQWKHFRQFUHWHVXUIDFHLVREVHUYHG8QGRXEWHGO\VXFKVWDLQVUHVXOW
IURP SUHFLSLWDWLRQ RI VROXEOH LURQ WKDW GLIIXVHV RXWZDUGV IURP WKH FRUURGLQJ FDUERQ IURP SUHFLSLWDWLRQ RI VROXEOH LURQ WKDW GLIIXVHV RXWZDUGV IURP WKH FRUURGLQJ FDUERQ
VWHHO UHLQIRUFHPHQW +RZHYHU IURP WKH )H+2 µ6(3'¶ LQ )LJXUH  >$@ LW FDQ EH VWHHO UHLQIRUFHPHQW +RZHYHU IURP WKH )H+2 µ6(3'¶ LQ )LJXUH  >$@ LW FDQ EH
FRQFOXGHG WKDW GLIIXVLRQ RI VROXEOH LURQ VSHFLHV WKURXJK DQ XQFDUERQDWHG FRQFUHWH FRQFOXGHG WKDW GLIIXVLRQ RI VROXEOH LURQ VSHFLHV WKURXJK DQ XQFDUERQDWHG FRQFUHWH
FRYHU LV WKHUPRG\QDPLFDOO\ LPSRVVLEOH 7KH µ6(3'¶ FOHDUO\ LQGLFDWHV WKDW DQ\ GLV FRYHU LV WKHUPRG\QDPLFDOO\ LPSRVVLEOH 7KH µ6(3'¶ FOHDUO\ LQGLFDWHV WKDW DQ\ GLV
VROYHGIHUURXVLRQLVR[LGLVHG DQGSUHFLSLWDWHG DV )H2RU)H2 GHSHQGLQJRQWKH VROYHGIHUURXVLRQLVR[LGLVHG DQGSUHFLSLWDWHG DV )H2 RU )H2 GHSHQGLQJRQWKH
R[\JHQDYDLODELOLW\ LQFRQFUHWHZLWKDS+RIDQGDERYH R[\JHQDYDLODELOLW\ LQFRQFUHWHZLWKDS+RIDQGDERYH
5XVWVWDLQVDUHREVHUYHGDWFRQFUHWHH[SRVHGWRWKHDWPRVSKHUHVRWKDWFRQGLWLRQVFRU 5XVWVWDLQVDUHREVHUYHGDWFRQFUHWHH[SRVHGWRWKHDWPRVSKHUHVRWKDWFRQGLWLRQVFRU
UHVSRQGLQJWRORZSRWHQWLDOFRUURVLRQLHIRUPDWLRQRIVROXEOHELK\SRIHUULWHLRQFDQ UHVSRQGLQJWRORZSRWHQWLDOFRUURVLRQLHIRUPDWLRQRIVROXEOHELK\SRIHUULWHLRQFDQ
EHVDIHO\H[FOXGHG:LWKUHJDUGWRWKLVLWVKRXOGEHQRWHGWKDWZHH[FOXGHIRUPDWLRQ EHVDIHO\H[FOXGHG:LWKUHJDUGWRWKLVLWVKRXOGEHQRWHGWKDWZHH[FOXGHIRUPDWLRQ
RIRWKHUVROXEOHLURQVSHFLHVLQWKHDONDOLQHUHJLRQ)RULQVWDQFHIRUPDWLRQRIIHUULWH RIRWKHUVROXEOHLURQVSHFLHVLQWKHDONDOLQHUHJLRQ)RULQVWDQFHIRUPDWLRQRIIHUULWH
LRQ )H2í  FRXOG EH PLVWDNHQO\  WDNHQ LQWR FRQVLGHUDWLRQ IRU WKH HVWDEOLVKPHQW RI LRQ )H2í  FRXOG EH PLVWDNHQO\  WDNHQ LQWR FRQVLGHUDWLRQ IRU WKH HVWDEOLVKPHQW RI
WKH)H+2µ6(3'¶7KHHIIHFWRIVXFKPLVOHDGLQJDVVXPSWLRQVLVH[HPSOLILHGLQWKH WKH)H+2µ6(3'¶7KHHIIHFWRIVXFKPLVOHDGLQJDVVXPSWLRQVLVH[HPSOLILHGLQWKH
µ6(3'¶LQ)LJXUH>%@ZKLFKLVRQO\XVHGIRUH[HPSOLILFDWLRQSXUSRVHVDQGZLWK µ6(3'¶LQ)LJXUH>%@ZKLFKLVRQO\XVHGIRUH[HPSOLILFDWLRQSXUSRVHVDQGZLWK
RXWSUDFWLFDOUHOHYDQFHIRUWKHDUHDRIFRQFHUQLQWKLVWKHVLV RXWSUDFWLFDOUHOHYDQFHIRUWKHDUHDRIFRQFHUQLQWKLVWKHVLV
)RUPDWLRQRIIHUULWHLRQFDQEHGHVFULEHGE\ )RUPDWLRQRIIHUULWHLRQFDQEHGHVFULEHGE\

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

)H  2 + 2 − → )H2− ( Δ* 
= −  N- )  >@ )H  2 + 2 − → )H2− ( Δ* 
= −  N- )  >@

ZKLFKLVDVLQGLFDWHGE\WKHQHJDWLYHµ¨*¶DWKHUPRG\QDPLFDOO\IDYRXUHGDFLGEDVH ZKLFKLVDVLQGLFDWHGE\WKHQHJDWLYHµ¨*¶DWKHUPRG\QDPLFDOO\IDYRXUHGDFLGEDVH
UHDFWLRQ+RZHYHUDVH[HPSOLILHGLQ6HFWLRQIRUWKHGRXEWIXOUHDFWLRQGHVFULS UHDFWLRQ+RZHYHUDVH[HPSOLILHGLQ6HFWLRQIRUWKHGRXEWIXOUHDFWLRQGHVFULS
WLRQVRIWKHSDVVLYHVWDWH FIUHDFWLRQV>@DQG>@ UHDFWLRQVLQYROYLQJR[\JHQ WLRQVRIWKHSDVVLYHVWDWH FIUHDFWLRQV>@DQG>@ UHDFWLRQVLQYROYLQJR[\JHQ
,, LRQKDYHDVWURQJWKHUPRG\QDPLFWHQGHQF\WRRFFXUEXWWKHIRUPDWLRQRIWKHQHF ,, LRQKDYHDVWURQJWKHUPRG\QDPLFWHQGHQF\WRRFFXUEXWWKHIRUPDWLRQRIWKHQHF
HVVDU\R[\JHQ ,, LRQUHTXLUHVHOHFWURGHSRWHQWLDOVZKLFKDUHUHJDUGHGWREHHQWLUHO\ HVVDU\R[\JHQ ,, LRQUHTXLUHVHOHFWURGHSRWHQWLDOVZKLFKDUHUHJDUGHGWREHHQWLUHO\
RXWRIUDQJHIRUUHLQIRUFHGFRQFUHWH6RZHH[FOXGHIHUULWHLRQDQGDQ\RWKHUVROXEOH RXWRIUDQJHIRUUHLQIRUFHGFRQFUHWH6RZHH[FOXGHIHUULWHLRQDQGDQ\RWKHUVROXEOH
VSHFLHVLQWKHDONDOLQHUHJLRQH[FHSWIURP+)H2íIURPRXUDVVXPSWLRQVFRQFHUQLQJ VSHFLHVLQWKHDONDOLQHUHJLRQH[FHSWIURP+)H2íIURPRXUDVVXPSWLRQVFRQFHUQLQJ
WKH)H+2V\VWHP7KLVLVDOVRFRQILUPHGE\LQYHVWLJDWLQJSRVLWLYHDQGQHJDWLYHLQ WKH)H+2V\VWHP7KLVLVDOVRFRQILUPHGE\LQYHVWLJDWLQJSRVLWLYHDQGQHJDWLYHLQ
GLFDWRUVLQWKHOLWHUDWXUH FI6HFWLRQ :KLOHQRSRVLWLYHLQGLFDWRUVIRUWKHH[LV GLFDWRUVLQWKHOLWHUDWXUH FI6HFWLRQ :KLOHQRSRVLWLYHLQGLFDWRUVIRUWKHH[LV
WHQFHRIVXFKVSHFLHVXQGHUFRQGLWLRQVFRPSDUDEOHWRWKHFRQFUHWHHQYLURQPHQWKDYH WHQFHRIVXFKVSHFLHVXQGHUFRQGLWLRQVFRPSDUDEOHWRWKHFRQFUHWHHQYLURQPHQWKDYH
EHHQUHSRUWHGIRUPDWLRQRIIHUULWHLRQLVQRUPDOO\GLVFXVVHGLQFRQQHFWLRQZLWKKLJK EHHQUHSRUWHGIRUPDWLRQRIIHUULWHLRQLVQRUPDOO\GLVFXVVHGLQFRQQHFWLRQZLWKKLJK
WHPSHUDWXUHFRUURVLRQHJFRUURVLRQLQ.UDIWUHFRYHU\ERLOHUV>&ROZHOO@ZKLFK WHPSHUDWXUHFRUURVLRQHJFRUURVLRQLQ.UDIWUHFRYHU\ERLOHUV>&ROZHOO@ZKLFK
ZH UHJDUG DV QHJDWLYH LQGLFDWRUV IRU WKH H[LVWHQFH LQ FXVWRPDU\ FRQFUHWHVWHHO V\V ZH UHJDUG DV QHJDWLYH LQGLFDWRUV IRU WKH H[LVWHQFH LQ FXVWRPDU\ FRQFUHWHVWHHO V\V
WHPV WHPV
7KXVLWFDQEHFRQFOXGHGWKDWWKHIUHTXHQWO\REVHUYHGRXWZDUGVGLIIXVLRQRILURQVSH 7KXVLWFDQEHFRQFOXGHGWKDWWKHIUHTXHQWO\REVHUYHGRXWZDUGVGLIIXVLRQRILURQVSH
FLHV LQ FKORULGH FRQWDPLQDWHG XQFDUERQDWHG FRQFUHWH LV WKHUPRG\QDPLFDOO\ LPSRVVL FLHV LQ FKORULGH FRQWDPLQDWHG XQFDUERQDWHG FRQFUHWH LV WKHUPRG\QDPLFDOO\ LPSRVVL
EOH ZLWKRXW RWKHU WKHUPRG\QDPLF UHOHYDQW FKDQJHV WDNLQJ SDUW :H VXJJHVW WKDW WKH EOH ZLWKRXW RWKHU WKHUPRG\QDPLF UHOHYDQW FKDQJHV WDNLQJ SDUW :H VXJJHVW WKDW WKH
RQO\SRVVLEOHH[SODQDWLRQIRURXWZDUGVGLIIXVLRQRILURQLRQVLVDFKDQJHRIS+LQWKH RQO\SRVVLEOHH[SODQDWLRQIRURXWZDUGVGLIIXVLRQRILURQLRQVLVDFKDQJHRIS+LQWKH
DVVRFLDWHGDUHDVRIWKHFRQFUHWHFRYHU DVVRFLDWHGDUHDVRIWKHFRQFUHWHFRYHU
0RVWRIWKHOLWHUDWXUHGHDOLQJZLWKGLIIXVLRQRIGLVVROYHGLURQLRQVLQR[\JHQGHSULYHG 0RVWRIWKHOLWHUDWXUHGHDOLQJZLWKGLIIXVLRQRIGLVVROYHGLURQLRQVLQR[\JHQGHSULYHG
FRQFUHWH VLPSO\ H[SODLQV WKLV SKHQRPHQRQ E\ UHIHUULQJ WR PDFURFHOO FRUURVLRQ FI FRQFUHWH VLPSO\ H[SODLQV WKLV SKHQRPHQRQ E\ UHIHUULQJ WR PDFURFHOO FRUURVLRQ FI
6HFWLRQ DQGSRVWXODWHVWKDWGLVVROYHGLURQVWD\VLQVROXWLRQEHFDXVHWKHUHLVQR 6HFWLRQ DQGSRVWXODWHVWKDWGLVVROYHGLURQVWD\VLQVROXWLRQEHFDXVHWKHUHLVQR
R[\JHQDYDLODEOHIRUIXUWKHUWUDQVIRUPDWLRQV+RZHYHUWKH3RXUEDL[GLDJUDPDQGWKH R[\JHQDYDLODEOHIRUIXUWKHUWUDQVIRUPDWLRQV+RZHYHUWKH3RXUEDL[GLDJUDPDQGWKH
FRUUHVSRQGLQJUHDFWLRQVIRUWKHS+DQGµ(FRUU¶RIFRQFHUQFOHDUO\LQGLFDWHWKDWWKHUPR FRUUHVSRQGLQJUHDFWLRQVIRUWKHS+DQGµ(FRUU¶RIFRQFHUQFOHDUO\LQGLFDWHWKDWWKHUPR
G\QDPLFDOO\QRDGGLWLRQDOVXSSO\RIR[\JHQLVQHFHVVDU\IRUIHUURXVLURQWRSUHFLSLWDWH G\QDPLFDOO\QRDGGLWLRQDOVXSSO\RIR[\JHQLVQHFHVVDU\IRUIHUURXVLURQWRSUHFLSLWDWH
LQDONDOLQHVROXWLRQV LQDONDOLQHVROXWLRQV

)H + + +  2 → )H  2 + + + + H− (( 
 =  P96+( )  >@ )H + + +  2 → )H  2 + + + + H− (( 
 =  P96+( )  >@

)H + + +  2 → )H2  + + + + H − (( 
 =  P96+( )  >@ )H + + +  2 → )H2  + + + + H − (( 
 =  P96+( )  >@

6RZHUHJDUGWKHPHFKDQLVPIRUGLIIXVLRQRIGLVVROYHGLURQLQXQFDUERQDWHGFKORULGH 6RZHUHJDUGWKHPHFKDQLVPIRUGLIIXVLRQRIGLVVROYHGLURQLQXQFDUERQDWHGFKORULGH
FRQWDPLQDWHGFRQFUHWHWREHPRUHFRPSOH[ FRQWDPLQDWHGFRQFUHWHWREHPRUHFRPSOH[
:KLOH WKH FRQGLWLRQV RI IRUPDWLRQ DV ZHOO DV WKH FRPSRVLWLRQ DQG FKDUDFWHULVWLFV RI :KLOH WKH FRQGLWLRQV RI IRUPDWLRQ DV ZHOO DV WKH FRPSRVLWLRQ DQG FKDUDFWHULVWLFV RI
FRPSRXQGV IRUPHG GXULQJ SURSDJDWLRQ RI FKORULGH LQGXFHG FRUURVLRQ DUH JHQHUDOO\ FRPSRXQGV IRUPHG GXULQJ SURSDJDWLRQ RI FKORULGH LQGXFHG FRUURVLRQ DUH JHQHUDOO\
QRW GHDOW ZLWK LQ VWDQGDUG WH[WERRNV RQ UHLQIRUFHPHQW FRUURVLRQ WKHUH DUH YDULRXV QRW GHDOW ZLWK LQ VWDQGDUG WH[WERRNV RQ UHLQIRUFHPHQW FRUURVLRQ WKHUH DUH YDULRXV
RWKHUSXEOLFDWLRQVHJWKHVHVDQGMRXUQDOSDSHUVGHDOLQJH[FOXVLYHO\ZLWKWKLVWRSLF RWKHUSXEOLFDWLRQVHJWKHVHVDQGMRXUQDOSDSHUVGHDOLQJH[FOXVLYHO\ZLWKWKLVWRSLF
,QVHYHUDORIWKHVHSXEOLFDWLRQVHYLGHQFHRIWKHIRUPDWLRQRIVROXEOHFRPSOH[HVRIIHU ,QVHYHUDORIWKHVHSXEOLFDWLRQVHYLGHQFHRIWKHIRUPDWLRQRIVROXEOHFRPSOH[HVRIIHU
URXV FKORULGH KDVEHHQ UHSRUWHG ,W KDVEHHQ VXJJHVWHG WKDW FKORULGHVERXQGLQWKHVH URXV FKORULGH KDVEHHQ UHSRUWHG ,W KDVEHHQ VXJJHVWHG WKDW FKORULGHVERXQGLQWKHVH
FRPSOH[HV FDQ EH UHOHDVHG E\ WKH FRQYHUVLRQ RI WKH FRPSOH[HV WR IHUULF K\GUR[LGH FRPSOH[HV FDQ EH UHOHDVHG E\ WKH FRQYHUVLRQ RI WKH FRPSOH[HV WR IHUULF K\GUR[LGH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV

ZKLFKOHDYHWKHFKORULGHLRQVIUHHIRUDQHZDWWDFNRQWKHSDVVLYHOD\HU0RUHRYHULW ZKLFKOHDYHWKHFKORULGHLRQVIUHHIRUDQHZDWWDFNRQWKHSDVVLYHOD\HU0RUHRYHULW
KDV EHHQ LQGLFDWHG WKDW WKHVH LURQFKORULGH FRPSOH[HV ZKLFK DUH VWDEOH RQO\ LQ WKH KDV EHHQ LQGLFDWHG WKDW WKHVH LURQFKORULGH FRPSOH[HV ZKLFK DUH VWDEOH RQO\ LQ WKH
DEVHQFH RI R[\JHQ FDQ LQYROYH ERWK IHUURXV DQG IHUULF LRQ >5HIDLW  *pQLQ  DEVHQFH RI R[\JHQ FDQ LQYROYH ERWK IHUURXV DQG IHUULF LRQ >5HIDLW  *pQLQ 
6DJRH&UHQWVLO *ODVVHU5HIDLW *pQLQ5HIDLWHWDO6DQGEHUJ 6DJRH&UHQWVLO *ODVVHU5HIDLW *pQLQ5HIDLWHWDO6DQGEHUJ
 *pQLQ HWDO  .ROHYD HWDO  &H)U&R  5pPD]HLOOHV  5HIDLW  *pQLQ HWDO  .ROHYD HWDO  &H)U&R  5pPD]HLOOHV  5HIDLW
@ @
6XFKFRPSOH[HVDUHLQWKHOLWHUDWXUHJHQHUDOO\UHIHUUHGWRDVJUHHQUXVWZLWKUHJDUGWR 6XFKFRPSOH[HVDUHLQWKHOLWHUDWXUHJHQHUDOO\UHIHUUHGWRDVJUHHQUXVWZLWKUHJDUGWR
WKH FRORXU RI WKH OLTXLG ZKHQ ILUVW H[SRVHG WR WKH DWPRVSKHUH 6RPH DXWKRUV HJ WKH FRORXU RI WKH OLTXLG ZKHQ ILUVW H[SRVHG WR WKH DWPRVSKHUH 6RPH DXWKRUV HJ
>5HIDLW  *pQLQ  5HIDLW HWDO  *pQLQ HWDO  .ROHYD HWDO @  >5HIDLW  *pQLQ  5HIDLW HWDO  *pQLQ HWDO  .ROHYD HWDO @ 
GLVWLQJXLVKIXUWKHUEHWZHHQWZRVLPLODUW\SHVRI FU\VWDOVWUXFWXUHIRUJUHHQUXVWVDQG GLVWLQJXLVKIXUWKHUEHWZHHQWZRVLPLODUW\SHVRI FU\VWDOVWUXFWXUHIRUJUHHQUXVWVDQG
UHIHU WR JUHHQ UXVW RQH µ*5¶ IRU LURQFKORULGH FRPSRXQGV DQG WR JUHHQ UXVW WZR UHIHU WR JUHHQ UXVW RQH µ*5¶ IRU LURQFKORULGH FRPSRXQGV DQG WR JUHHQ UXVW WZR
µ*5¶  IRU LURQVXOSKDWH FRPSRXQGV )RU WKH SXUSRVH RI WKLV WKHVLV RQO\ µ*5¶ LV µ*5¶  IRU LURQVXOSKDWH FRPSRXQGV )RU WKH SXUSRVH RI WKLV WKHVLV RQO\ µ*5¶ LV
UHOHYDQW DQG VLPSO\ UHJDUGHG DV D OLTXLG LURQ K\GUR[\FKORULGH FRPSRXQG LQYROYLQJ UHOHYDQW DQG VLPSO\ UHJDUGHG DV D OLTXLG LURQ K\GUR[\FKORULGH FRPSRXQG LQYROYLQJ
ERWKR[LGDWLRQVWDWHVRILURQ DQG 5HIHUHQFHLVPDGHWRHJ>5HIDLW *pQLQ ERWKR[LGDWLRQVWDWHVRILURQ DQG 5HIHUHQFHLVPDGHWRHJ>5HIDLW *pQLQ
6DJRH&UHQWVLO *ODVVHU5HIDLW *pQLQ5HIDLWHWDO*p 6DJRH&UHQWVLO *ODVVHU5HIDLW *pQLQ5HIDLWHWDO*p
QLQ HWDO  .ROHYD HWDO  5pPD]HLOOHV  5HIDLW @ IRU D GHWDLOHG GH QLQ HWDO  .ROHYD HWDO  5pPD]HLOOHV  5HIDLW @ IRU D GHWDLOHG GH
VFULSWLRQRUGLVFXVVLRQVRQWKHH[DFWFKHPLFDOSURSHUWLHVRIµ*5¶ VFULSWLRQRUGLVFXVVLRQVRQWKHH[DFWFKHPLFDOSURSHUWLHVRIµ*5¶
:KLOHGXHWRWKHVLPLODUFU\VWDOVWUXFWXUHWKHVROLGFRXQWHUSDUWRIµ*5¶LVJHQHUDOO\ :KLOHGXHWRWKHVLPLODUFU\VWDOVWUXFWXUHWKHVROLGFRXQWHUSDUWRIµ*5¶LVJHQHUDOO\
UHJDUGHG DV IRXJHULWH >*pQLQ HWDO  &H)U&R @ WKHUH LV D FRPPRQ DJUHH UHJDUGHG DV IRXJHULWH >*pQLQ HWDO  &H)U&R @ WKHUH LV D FRPPRQ DJUHH
PHQWWKDWµ*5¶LVWUDQVIRUPHGLQWRRWKHULURQFRPSRXQGVZKHQ H[SRVHGWRWKHDW PHQWWKDWµ*5¶LVWUDQVIRUPHGLQWRRWKHULURQFRPSRXQGVZKHQH[SRVHGWRWKHDW
PRVSKHUH ,QSDUWLFXODU JRHWKLWH )H22+ RUPDJQHWLWHDUHRIWHQVWDWHGDVWKHUPR PRVSKHUH ,QSDUWLFXODU JRHWKLWH )H22+ RUPDJQHWLWHDUHRIWHQVWDWHGDVWKHUPR
G\QDPLFDOO\IDYRXUHGFRPSRXQGV0RUHRYHU)H22+DQG)H2ZHUHIUHTXHQWO\RE G\QDPLFDOO\IDYRXUHGFRPSRXQGV0RUHRYHU)H22+DQG)H2ZHUHIUHTXHQWO\RE
VHUYHGE\HJ0|VVEDXHUVSHFWURVFRS\>'LFNVRQHWDO@RU5DPDQVSHFWURVFRS\ VHUYHGE\HJ0|VVEDXHUVSHFWURVFRS\>'LFNVRQHWDO@RU5DPDQVSHFWURVFRS\
>$QGRU @ DV VROLG FRUURVLRQ SURGXFWV IRUPHG XQGHU FKORULGH LQGXFHG FRUURVLRQ >$QGRU @ DV VROLG FRUURVLRQ SURGXFWV IRUPHG XQGHU FKORULGH LQGXFHG FRUURVLRQ
>0LVDZD  5DKDULQDLYR HWDO  .ROHYD HWDO  0DUFRWWH  +DQVVRQ >0LVDZD  5DKDULQDLYR HWDO  .ROHYD HWDO  0DUFRWWH  +DQVVRQ
@7KXVZHWDNHIRUPDWLRQRI)H22+ µ¨*I¶ íN-PRO LQWRFRQVLGHUDWLRQ @7KXVZHWDNHIRUPDWLRQRI)H22+ µ¨*I¶ íN-PRO LQWRFRQVLGHUDWLRQ
LQVWHDGRIIRUPDWLRQRI)H2 µ¨*I¶ íN-PRO IRUWKHFDVHRIFKORULGHLQGXFHG LQVWHDGRIIRUPDWLRQRI)H2 µ¨*I¶ íN-PRO IRUWKHFDVHRIFKORULGHLQGXFHG
FRUURVLRQLQWKHR[\JHQGHSULYHGFRQFUHWH FRUURVLRQLQWKHR[\JHQGHSULYHGFRQFUHWH
)URP D FRPSDULVRQ RI WKH HTXLOLEULXP OLQHV OLPLWLQJ )H2 DQG )H22+ LQ WKH )URP D FRPSDULVRQ RI WKH HTXLOLEULXP OLQHV OLPLWLQJ )H2 DQG )H22+ LQ WKH
µ6(3'V¶RIWKH)H+2 V\VWHP IRUERWKSUHVHOHFWLRQV LQ )LJXUH  >$@ DQG >%@ UH µ6(3'V¶RIWKH)H+2 V\VWHP IRUERWKSUHVHOHFWLRQV LQ )LJXUH  >$@ DQG >%@ UH
VSHFWLYHO\LWFDQREVHUYHGWKDWWKHWZRVWDELOLW\GRPDLQVDOPRVWFRUUHVSRQG VSHFWLYHO\LWFDQREVHUYHGWKDWWKHWZRVWDELOLW\GRPDLQVDOPRVWFRUUHVSRQG

 

7KLVGHVFULSWLRQLVVLPSOLILHG,QWKHOLWHUDWXUHLWLVJHQHUDOO\GLVWLQJXLVKHGEHWZHHQGLIIHUHQWSKDVHV 7KLVGHVFULSWLRQLVVLPSOLILHG,QWKHOLWHUDWXUHLWLVJHQHUDOO\GLVWLQJXLVKHGEHWZHHQGLIIHUHQWSKDVHV
RI)H22+HJJRHWKLWH Į)H22+ DNDJDQHLWH ȕ)H22+ DQGOHSLGRFURFLWH Ȗ)H22+ 7KLVGLV RI)H22+HJJRHWKLWH Į)H22+ DNDJDQHLWH ȕ)H22+ DQGOHSLGRFURFLWH Ȗ)H22+ 7KLVGLV
WLQFWLRQLVRIPDUJLQDOLPSRUWDQFHLQWKHSUHVHQWWKHVLVDQGDOOSKDVHVRI)H22+DUHUHIHUUHGWRDV WLQFWLRQLVRIPDUJLQDOLPSRUWDQFHLQWKHSUHVHQWWKHVLVDQGDOOSKDVHVRI)H22+DUHUHIHUUHGWRDV
JRHWKLWH FIIRRWQRWHRQSKDVHVRI)H2  JRHWKLWH FIIRRWQRWHRQSKDVHVRI)H2 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

 
)LJXUH >$@ )H+2 µ6(3'¶ EDVHG RQ SUHVHOHFWLRQ RI VSHFLHV DFFRUGLQJ WR )LJXUH >$@ )H+2 µ6(3'¶ EDVHG RQ SUHVHOHFWLRQ RI VSHFLHV DFFRUGLQJ WR
7DEOH  DQG )HLD  í PRO/ DQG >%@ $V >$@ EXW GHVHOHFWLRQ RI 7DEOH  DQG )HLD  í PRO/ DQG >%@ $V >$@ EXW GHVHOHFWLRQ RI
)H2DQGSUHVHOHFWLRQRI)H22+DFFRUGLQJWR7DEOH>&@3DUWLDO )H2DQGSUHVHOHFWLRQRI)H22+DFFRUGLQJWR7DEOH>&@3DUWLDO
µ6,3'¶ZLWK>%@DVXQGHUO\LQJµ6(3'¶DQGVXSHULPSRVHGVWDELOLW\GR µ6,3'¶ZLWK>%@DVXQGHUO\LQJµ6(3'¶DQGVXSHULPSRVHGVWDELOLW\GR
PDLQV RI µ*5¶ DVSRVWXODWHG LQ WKH OLWHUDWXUH LH $  µ*5¶GRPDLQ PDLQV RI µ*5¶ DVSRVWXODWHG LQ WKH OLWHUDWXUH LH $  µ*5¶GRPDLQ
IRUD&OLD íPRO/DIWHU>6DJRH&UHQWVLO *ODVVHU@DQG %  IRUD&OLD íPRO/DIWHU>6DJRH&UHQWVLO *ODVVHU@DQG % 
*5¶GRPDLQIRU&OLD PRO/DIWHU>5HIDLW *pQLQ@'LD *5¶GRPDLQIRU&OLD PRO/DIWHU>5HIDLW *pQLQ@'LD
JUDP>&@LVIRUH[HPSOLILFDWLRQSXUSRVHVRQO\DQGLWQHLWKHUUHSUHVHQWV JUDP>&@LVIRUH[HPSOLILFDWLRQSXUSRVHVRQO\DQGLWQHLWKHUUHSUHVHQWV
DFWXDOFRQGLWLRQVQRUWKHH[DFWRULJLQDODVVXPSWLRQVRI>5HIDLW *p DFWXDOFRQGLWLRQVQRUWKHH[DFWRULJLQDODVVXPSWLRQVRI>5HIDLW *p
QLQ6DJRH&UHQWVLO *ODVVHU@ QLQ6DJRH&UHQWVLO *ODVVHU@
 

7DEOH 6SHFLHV SUHVHOHFWHG IRU WKH µ6(3'¶ RI WKH )H+2 V\VWHP FRQVLGHULQJ 7DEOH 6SHFLHV SUHVHOHFWHG IRU WKH µ6(3'¶ RI WKH )H+2 V\VWHP FRQVLGHULQJ
IRUPDWLRQRI)H22+LQVWHDGRI)H2 IRUPDWLRQRI)H22+LQVWHDGRI)H2

6ROLG )H )H2 )H22+ 6ROLG )H )H2 )H22+


  í  
6ROXEOH )H  )H  +)H2  6ROXEOH )H  )H  +)H2í
 
6WDELOLW\GRPDLQVIRUµ*5¶KDYHEHHQSURSRVHGLQ>6DJRH&UHQWVLO *ODVVHU@ 6WDELOLW\GRPDLQVIRUµ*5¶KDYHEHHQSURSRVHGLQ>6DJRH&UHQWVLO *ODVVHU@
DQG LQ >5HIDLW  *pQLQ @ 7KH H[WHQWV RI WKHVH VWDELOLW\ GRPDLQV ZKLFK FRUUH DQG LQ >5HIDLW  *pQLQ @ 7KH H[WHQWV RI WKHVH VWDELOLW\ GRPDLQV ZKLFK FRUUH
VSRQGWRFKORULGHFRQFHQWUDWLRQVRI $ íPRO/>6DJRH&UHQWVLO *ODVVHU@ VSRQGWRFKORULGHFRQFHQWUDWLRQVRI $ íPRO/>6DJRH&UHQWVLO *ODVVHU@
DQG % PRO/>5HIDLW *pQLQ@LVLQGLFDWHGLQWKHSDUWLDOµ6,3'¶LQ)LJ DQG % PRO/>5HIDLW *pQLQ@LVLQGLFDWHGLQWKHSDUWLDOµ6,3'¶LQ)LJ
XUH>&@,WVKRXOGEHQRWHGWKDWWKHDSSURDFKFKRVHQIRUWKHXQGHUO\LQJ3RXUEDL[ XUH>&@,WVKRXOGEHQRWHGWKDWWKHDSSURDFKFKRVHQIRUWKHXQGHUO\LQJ3RXUEDL[
GLDJUDP ZKLFK FRUUHVSRQGV WR )LJXUH  >%@ GRHV QRW H[DFWO\ UHIOHFW WKH DVVXPS GLDJUDP ZKLFK FRUUHVSRQGV WR )LJXUH  >%@ GRHV QRW H[DFWO\ UHIOHFW WKH DVVXPS
WLRQVLQWKHRULJLQDOVRXUFHV:KLOHERWKSXEOLFDWLRQVFRQVLGHUIRUPDWLRQRI)H22+DV WLRQVLQWKHRULJLQDOVRXUFHV:KLOHERWKSXEOLFDWLRQVFRQVLGHUIRUPDWLRQRI)H22+DV
IDYRXUHG VROLG FRPSRXQG WKH RWKHU LURQ VSHFLHV GLIIHU WR D FHUWDLQ H[WHQW DQG UHIHU IDYRXUHG VROLG FRPSRXQG WKH RWKHU LURQ VSHFLHV GLIIHU WR D FHUWDLQ H[WHQW DQG UHIHU
HQFH LV PDGH WR WKH RULJLQDO SXEOLFDWLRQV >5HIDLW  *pQLQ  6DJRH&UHQWVLO  HQFH LV PDGH WR WKH RULJLQDO SXEOLFDWLRQV >5HIDLW  *pQLQ  6DJRH&UHQWVLO 
*ODVVHU @ IRU WKH UHODWHG WKHRU\ 1HLWKHU RI WKH WZR SRVWXODWHG µ*5¶ VWDELOLW\ *ODVVHU @ IRU WKH UHODWHG WKHRU\ 1HLWKHU RI WKH WZR SRVWXODWHG µ*5¶ VWDELOLW\
GRPDLQV FDQ EH IDYRXUHG RU UHMHFWHG EXW ZH GR QRW H[SHFW WKH VWDELOLW\ GRPDLQ RI GRPDLQV FDQ EH IDYRXUHG RU UHMHFWHG EXW ZH GR QRW H[SHFW WKH VWDELOLW\ GRPDLQ RI
µ*5¶WRH[WHQWLQWRWKHLPPXQLW\GRPDLQ FDVH $ FIDOVR6HFWLRQ DQGWKH µ*5¶WRH[WHQWLQWRWKHLPPXQLW\GRPDLQ FDVH $ FIDOVR6HFWLRQ DQGWKH
VXJJHVWHGVWDELOLW\GRPDLQ $ LVUHODWLYHO\ODUJHIRUDUHODWLYHO\ORZFKORULGHFRQFHQ VXJJHVWHGVWDELOLW\GRPDLQ $ LVUHODWLYHO\ODUJHIRUDUHODWLYHO\ORZFKORULGHFRQFHQ
WUDWLRQ LQ SDUWLFXODU LQ FRPSDULVRQ ZLWK VWDELOLW\ GRPDLQ %  ZKLFK LV VPDOOHU DW D WUDWLRQ LQ SDUWLFXODU LQ FRPSDULVRQ ZLWK VWDELOLW\ GRPDLQ %  ZKLFK LV VPDOOHU DW D
PXFKKLJKHUFKORULGHFRQFHQWUDWLRQ PXFKKLJKHUFKORULGHFRQFHQWUDWLRQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV

+RZHYHU LQ QHLWKHU RI WKH WZR VRXUFHV >5HIDLW  *pQLQ  6DJRH&UHQWVLO  +RZHYHU LQ QHLWKHU RI WKH WZR VRXUFHV >5HIDLW  *pQLQ  6DJRH&UHQWVLO 
*ODVVHU@WKHIXOOWKHUPRG\QDPLFHIIHFWRIFKORULGHLVWDNHQLQWRDFFRXQWLHWKH *ODVVHU@WKHIXOOWKHUPRG\QDPLFHIIHFWRIFKORULGHLVWDNHQLQWRDFFRXQWLHWKH
IRUPDWLRQRIRWKHULURQFKORULGHFRPSRXQGVLVQRWUHSUHVHQWHGLQWKHDVVRFLDWHG3RXU IRUPDWLRQRIRWKHULURQFKORULGHFRPSRXQGVLVQRWUHSUHVHQWHGLQWKHDVVRFLDWHG3RXU
EDL[GLDJUDPV:HWKLQNWKDWWKLVLVWKHUPRG\QDPLFDOO\LQFRQVLVWHQWDQGVXJJHVWWKDW EDL[GLDJUDPV:HWKLQNWKDWWKLVLVWKHUPRG\QDPLFDOO\LQFRQVLVWHQWDQGVXJJHVWWKDW
WKHIRUPDWLRQRIµ*5¶DVZHOODVGLIIXVLRQRIGLVVROYHGLURQLRQVFDQEHFRQVLVWHQWO\ WKHIRUPDWLRQRIµ*5¶DVZHOODVGLIIXVLRQRIGLVVROYHGLURQLRQVFDQEHFRQVLVWHQWO\
GHVFULEHG ZKHQ FKORULGH DQG ZLWK WKDW DOO IDYRXUHG LURQFKORULGH FRPSRXQGV DUH GHVFULEHG ZKHQ FKORULGH DQG ZLWK WKDW DOO IDYRXUHG LURQFKORULGH FRPSRXQGV DUH
WDNHQLQWRGXHFRQVLGHUDWLRQLQWKHHVWDEOLVKPHQWRIWKH3RXUEDL[GLDJUDP7KHWKHU WDNHQLQWRGXHFRQVLGHUDWLRQLQWKHHVWDEOLVKPHQWRIWKH3RXUEDL[GLDJUDP7KHWKHU
PRG\QDPLFFKDQJHVZHFRQVLGHUIRUWKHDGGLWLRQRIFKORULGHWRWKH)H+2V\VWHPDUH PRG\QDPLFFKDQJHVZHFRQVLGHUIRUWKHDGGLWLRQRIFKORULGHWRWKH)H+2V\VWHPDUH
GHPRQVWUDWHGLQ)LJXUH GHPRQVWUDWHGLQ)LJXUH

 
í í
)LJXUH >$@)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD  PRO/>%@ )LJXUH >$@)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD  PRO/>%@
)H&O+2µ0(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/DQG&OLD )H&O+2µ0(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/DQG&OLD
íPRO/>&@$V>%@EXW&OLD PRO/ íPRO/>&@$V>%@EXW&OLD PRO/
 

7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH)H&O+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH)H&O+2V\VWHP

6ROLG )H )H2 )H22+     6ROLG )H )H2 )H22+    


í í     í í í    
6ROXEOH &O  &O2  )H  )H  )H&O  )H&O  +)H2  6ROXEOH &O  &O2  )H  )H  )H&O  )H&O  +)H2í
 
)LJXUH>$@FRUUHVSRQGVWR)LJXUH>%@LHLWUHSUHVHQWVWKHµ6(3'¶RIWKH)H )LJXUH>$@FRUUHVSRQGVWR)LJXUH>%@LHLWUHSUHVHQWVWKHµ6(3'¶RIWKH)H
+2V\VWHPDFFRUGLQJWR7DEOHZKLFKFDQSULQFLSDOO\EHDOVRXQGHUVWRRGDVWKH +2V\VWHPDFFRUGLQJWR7DEOHZKLFKFDQSULQFLSDOO\EHDOVRXQGHUVWRRGDVWKH
µ0(3'¶RIWKH)H&O+2V\VWHPZLWKDFKORULGHLRQDFWLYLW\RIPRO/)LJXUH µ0(3'¶RIWKH)H&O+2V\VWHPZLWKDFKORULGHLRQDFWLYLW\RIPRO/)LJXUH
>%@DQG>&@UHSUHVHQWWKHWKHUPRG\QDPLFFRQGLWLRQVZKHQWKHFKORULGHLRQDFWLYLW\LV >%@DQG>&@UHSUHVHQWWKHWKHUPRG\QDPLFFRQGLWLRQVZKHQWKHFKORULGHLRQDFWLYLW\LV
LQFUHDVHG WR í DQG  PRO/ UHVSHFWLYHO\ 7KLV LQFOXGHV WKDW WKHVH µ0(3'V¶ DUH LQFUHDVHG WR í DQG  PRO/ UHVSHFWLYHO\ 7KLV LQFOXGHV WKDW WKHVH µ0(3'V¶ DUH
EDVHGRQDQRWKHUSUHVHOHFWLRQRIVSHFLHVZKLFKLVSUHVHQWHGLQ7DEOH EDVHGRQDQRWKHUSUHVHOHFWLRQRIVSHFLHVZKLFKLVSUHVHQWHGLQ7DEOH
,QWURGXFWLRQRIFKORULGHWRWKHV\VWHPGRHVQRWLQIOXHQFHWKHµ¨*I¶RIVSHFLHVWKDWGR ,QWURGXFWLRQRIFKORULGHWRWKHV\VWHPGRHVQRWLQIOXHQFHWKHµ¨*I¶RIVSHFLHVWKDWGR
QRWLQYROYHFKORULGHLH)H2DQG)H22+,Q)LJXUHLWFDQEHREVHUYHGWKDWZLWK QRWLQYROYHFKORULGHLH)H2DQG)H22+,Q)LJXUHLWFDQEHREVHUYHGWKDWZLWK
LQFUHDVLQJ&OLDWKHVWDELOLW\GRPDLQVRIIHUULFFKORULGH )H&O ZKLFKZHDVVXPHWR LQFUHDVLQJ&OLDWKHVWDELOLW\GRPDLQVRIIHUULFFKORULGH )H&O ZKLFKZHDVVXPHWR
EHWKHPRVWFULWLFDOVSHFLHVLQFRUURVLRQSURSDJDWLRQHQODUJHVWRZDUGVKLJKHUS+RQ EHWKHPRVWFULWLFDOVSHFLHVLQFRUURVLRQSURSDJDWLRQHQODUJHVWRZDUGVKLJKHUS+RQ
WKHH[SHQVHRIVWDELOLW\GRPDLQVRI)H2DQG)H22+:LWKIXUWKHULQFUHPHQWRIWKH WKHH[SHQVHRIVWDELOLW\GRPDLQVRI)H2DQG)H22+:LWKIXUWKHULQFUHPHQWRIWKH
FKORULGHLRQDFWLYLW\IHUURXVFKORULGH )H&O UHSODFHVIHUURXVLURQDQGGRPLQDWHVWKH FKORULGHLRQDFWLYLW\IHUURXVFKORULGH )H&O UHSODFHVIHUURXVLURQDQGGRPLQDWHVWKH
DVVRFLDWHGVWDELOLW\GRPDLQ,IWKHLURQLRQDFWLYLW\LVNHSWDWíPRO/WKLVWKHUPR DVVRFLDWHGVWDELOLW\GRPDLQ,IWKHLURQLRQDFWLYLW\LVNHSWDWíPRO/WKLVWKHUPR
G\QDPLFVKLIWWDNHVSODFHDWDFKORULGHLRQDFWLYLW\RIPRO/,QFRQWUDVWWRHJWKH G\QDPLFVKLIWWDNHVSODFHDWDFKORULGHLRQDFWLYLW\RIPRO/,QFRQWUDVWWRHJWKH
LQWURGXFWLRQ RI FDOFLXP WR WKH )H+2 V\VWHP FI )LJXUH  LQ 6HFWLRQ   LQWURGXFWLRQ RI FDOFLXP WR WKH )H+2 V\VWHP FI )LJXUH  LQ 6HFWLRQ  

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

ZKHUH RQO\ VROLG LURQFDOFLXP FRPSOH[HV ZHUH WDNHQ LQWR DFFRXQW WKH HTXLOLEULD LQ ZKHUH RQO\ VROLG LURQFDOFLXP FRPSOH[HV ZHUH WDNHQ LQWR DFFRXQW WKH HTXLOLEULD LQ
WKH)H&O+2µ0(3'¶DUHDIIHFWHGE\ERWKLRQDFWLYLWLHV WKH)H&O+2µ0(3'¶DUHDIIHFWHGE\ERWKLRQDFWLYLWLHV
7KHSURSRVHGPRGHOIRUFKORULGHLQGXFHGFRUURVLRQLVEDVHGRQWKHµ0(3'¶RIWKH)H 7KHSURSRVHGPRGHOIRUFKORULGHLQGXFHGFRUURVLRQLVEDVHGRQWKHµ0(3'¶RIWKH)H
&O+2V\VWHPSUHVHQWHGLQ)LJXUH>&@LHDQLURQLRQDFWLYLW\RIíPRO/DV &O+2V\VWHPSUHVHQWHGLQ)LJXUH>&@LHDQLURQLRQDFWLYLW\RIíPRO/DV
FRQVHUYDWLYHFKRLFHIRUIRUPDWLRQRISDVVLYHGRPDLQV FI6HFWLRQ DQGDFKOR FRQVHUYDWLYHFKRLFHIRUIRUPDWLRQRISDVVLYHGRPDLQV FI6HFWLRQ DQGDFKOR
ULGHLRQDFWLYLW\RIPRO/ZKLFKFRUUHVSRQGVWRJ/SRUHVROXWLRQ FI7DEOH ULGHLRQDFWLYLW\RIPRO/ZKLFKFRUUHVSRQGVWRJ/SRUHVROXWLRQ FI7DEOH
LQ6HFWLRQ ,WVKRXOGEHUHPDUNHGWKDWWKHVHOHFWHGFKORULGHFRQFHQWUDWLRQPLJKW LQ6HFWLRQ ,WVKRXOGEHUHPDUNHGWKDWWKHVHOHFWHGFKORULGHFRQFHQWUDWLRQPLJKW
EHUHJDUGHGDVDUELWUDU\DQGKLJKEXWEDVHGRQWKHWKHRU\GHVFULEHGIRUSLWWLQJFRUUR EHUHJDUGHGDVDUELWUDU\DQGKLJKEXWEDVHGRQWKHWKHRU\GHVFULEHGIRUSLWWLQJFRUUR
VLRQ FI6HFWLRQ PLJUDWLRQ FI6HFWLRQ DQGLRQPRELOLW\ FI6HFWLRQ VLRQ FI6HFWLRQ PLJUDWLRQ FI6HFWLRQ DQGLRQPRELOLW\ FI6HFWLRQ
 ZHDVVXPHVXFKFRQFHQWUDWLRQWREHUDWKHUOLNHO\DWWDLQHGZLWKLQDFRUURVLRQ  ZHDVVXPHVXFKFRQFHQWUDWLRQWREHUDWKHUOLNHO\DWWDLQHGZLWKLQDFRUURVLRQ
SLW SLW
,Q )LJXUH  >&@ LW FDQ EH REVHUYHG WKDW HYHQ ZLWK WKLV UHODWLYHO\ KLJK FKORULGH LRQ ,Q )LJXUH  >&@ LW FDQ EH REVHUYHG WKDW HYHQ ZLWK WKLV UHODWLYHO\ KLJK FKORULGH LRQ
DFWLYLW\ FRUURVLRQ SURSDJDWLRQ LV WKHUPRG\QDPLFDOO\ LPSRVVLEOH ZKHQ WKH ³JOREDO´ DFWLYLW\ FRUURVLRQ SURSDJDWLRQ LV WKHUPRG\QDPLFDOO\ LPSRVVLEOH ZKHQ WKH ³JOREDO´
S+ RI UHLQIRUFHPHQW LQ XQFDUERQDWHG FRQFUHWH HJ S+  FI 6HFWLRQ   LV S+ RI UHLQIRUFHPHQW LQ XQFDUERQDWHG FRQFUHWH HJ S+  FI 6HFWLRQ   LV
WDNHQLQWRDFFRXQW+RZHYHUWKHUHLVDJHQHUDODJUHHPHQWLQWKHOLWHUDWXUHWKDWSURSD WDNHQLQWRDFFRXQW+RZHYHUWKHUHLVDJHQHUDODJUHHPHQWLQWKHOLWHUDWXUHWKDWSURSD
JDWLRQRISLWWLQJFRUURVLRQLQYROYHVGHSOHWLRQRIR[\JHQLQWKHSLWGXHWRWKHRQJRLQJ JDWLRQRISLWWLQJFRUURVLRQLQYROYHVGHSOHWLRQRIR[\JHQLQWKHSLWGXHWRWKHRQJRLQJ
IRUPDWLRQ RI DQRGLF FRUURVLRQSURGXFWVDVZHOODVDQDVVRFLDWHG DFLGLILFDWLRQ ZKLFK IRUPDWLRQ RI DQRGLF FRUURVLRQSURGXFWVDVZHOODVDQDVVRFLDWHG DFLGLILFDWLRQ ZKLFK
OHDGVWRDPDMRUORFDOLVHGS+GURS$PDFURFHOOLVIRUPHGDQGGLVVROXWLRQRILURQ LH OHDGVWRDPDMRUORFDOLVHGS+GURS$PDFURFHOOLVIRUPHGDQGGLVVROXWLRQRILURQ LH
WKHDQRGLFUHDFWLRQ WDNHVSODFHLQWKHSLWRQO\ZKLOHWKHDGMDFHQWSDVVLYHVWHHODFWVDV WKHDQRGLFUHDFWLRQ WDNHVSODFHLQWKHSLWRQO\ZKLOHWKHDGMDFHQWSDVVLYHVWHHODFWVDV
FDWKRGH FI6HFWLRQ %DVHGRQWKHWKHRU\GHVFULEHGIRUWKHPRELOLW\RILRQVLW FDWKRGH FI6HFWLRQ %DVHGRQWKHWKHRU\GHVFULEHGIRUWKHPRELOLW\RILRQVLW
FDQ EH FRQFOXGHG WKDW WKH IRUPDWLRQ RI PDFURFHOOV LV KLJKO\ IDYRXUHG XQGHU WKH DV FDQ EH FRQFOXGHG WKDW WKH IRUPDWLRQ RI PDFURFHOOV LV KLJKO\ IDYRXUHG XQGHU WKH DV
VXPHG FRQGLWLRQV LH KLJK FRQGXFWLYLW\ LQ R[\JHQGHSULYHG XQFDUERQDWHG FRQFUHWH VXPHG FRQGLWLRQV LH KLJK FRQGXFWLYLW\ LQ R[\JHQGHSULYHG XQFDUERQDWHG FRQFUHWH
FI 6HFWLRQ   (YHQ LI WKH LQIOXHQFH RI FKORULGH LRQV RQ WKH FRQGXFWLYLW\ LV FI 6HFWLRQ   (YHQ LI WKH LQIOXHQFH RI FKORULGH LRQV RQ WKH FRQGXFWLYLW\ LV
PXFKVPDOOHUWKDQRIWHQGHVFULEHGLQWKHOLWHUDWXUH FI6HFWLRQ &OíFRQWULE PXFKVPDOOHUWKDQRIWHQGHVFULEHGLQWKHOLWHUDWXUH FI6HFWLRQ &OíFRQWULE
XWHVWRPDFURFHOOIRUPDWLRQDQGIXUWKHUPRUHKDVDODUJHDIILQLW\WRPLJUDWHDZD\IURP XWHVWRPDFURFHOOIRUPDWLRQDQGIXUWKHUPRUHKDVDODUJHDIILQLW\WRPLJUDWHDZD\IURP
WKHFDWKRGHWRZDUGVWKHDQRGHLHLQWRWKHSLW FI6HFWLRQ :HWKLQNWKDWWKLV WKHFDWKRGHWRZDUGVWKHDQRGHLHLQWRWKHSLW FI6HFWLRQ :HWKLQNWKDWWKLV
DUJXPHQWDWLRQVXSSRUWVWKHVHOHFWHGKLJKFKORULGHLRQDFWLYLW\WKDWWKHSURSRVHGPRGHO DUJXPHQWDWLRQVXSSRUWVWKHVHOHFWHGKLJKFKORULGHLRQDFWLYLW\WKDWWKHSURSRVHGPRGHO
LVEDVHGXSRQ LVEDVHGXSRQ
,QHJ>%URRPILHOG6DQGEHUJ@GHSOHWLRQRIR[\JHQLQWKHFRUURVLRQSLWLV ,QHJ>%URRPILHOG6DQGEHUJ@GHSOHWLRQRIR[\JHQLQWKHFRUURVLRQSLWLV
DWWULEXWHGWRWKHRQJRLQJIRUPDWLRQRIIHUULFK\GUR[LGHDVGHVFULEHGE\WKHUHGR[UH DWWULEXWHGWRWKHRQJRLQJIRUPDWLRQRIIHUULFK\GUR[LGHDVGHVFULEHGE\WKHUHGR[UH
DFWLRQ>@LQWKHWKUHHIROGUHDFWLRQPHFKDQLVP FI6HFWLRQ  DFWLRQ>@LQWKHWKUHHIROGUHDFWLRQPHFKDQLVP FI6HFWLRQ 

)H 2+   2   +  2 → )H 2+  ( Δ* 
−  N- )  >@ )H 2+   2   +  2 → )H 2+  ( Δ* 
−  N- )  >@

7KLVRQJRLQJSURFHVVLVFRQVLGHUHGWRUHVXOWLQWRFRQGLWLRQVZKHUHWKHIHUURXVLRQLQ 7KLVRQJRLQJSURFHVVLVFRQVLGHUHGWRUHVXOWLQWRFRQGLWLRQVZKHUHWKHIHUURXVLRQLQ
WKHSLWOLTXLGUHDFWVZLWKZDWHUWRIRUP+ZKLFKOHDGVWRDFLGLILFDWLRQRIWKHSLW WKHSLWOLTXLGUHDFWVZLWKZDWHUWRIRUP+ZKLFKOHDGVWRDFLGLILFDWLRQRIWKHSLW

)H + + +  2 → )H2+ + + + + ( Δ* 
=  N- )  >@ )H + + +  2 → )H2+ + + + + ( Δ* 
=  N- )  >@

7KHDFLGEDVHUHDFWLRQ>@LOOXVWUDWHVDSRVLWLYHµ¨*¶DQGZHGRQRWFRQVLGHUIRU 7KHDFLGEDVHUHDFWLRQ>@LOOXVWUDWHVDSRVLWLYHµ¨*¶DQGZHGRQRWFRQVLGHUIRU
PDWLRQ RI IHUULF K\GUR[LGH WR EH WKHUPRG\QDPLFDOO\ IDYRXUHG 0RUHRYHU ZH WKLQN PDWLRQ RI IHUULF K\GUR[LGH WR EH WKHUPRG\QDPLFDOO\ IDYRXUHG 0RUHRYHU ZH WKLQN
WKDWGXHWRWKHFRPSOH[HOHFWURFKHPLVWU\VHYHUDODQRGLFUHDFWLRQVDUHWKHUPRG\QDPL WKDWGXHWRWKHFRPSOH[HOHFWURFKHPLVWU\VHYHUDODQRGLFUHDFWLRQVDUHWKHUPRG\QDPL

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV

FDOO\SRVVLEOHDQGFRQWULEXWHWRWKHDFLGLILFDWLRQLQDFRUURVLRQSLW:LWKUHJDUGWRWKH FDOO\SRVVLEOHDQGFRQWULEXWHWRWKHDFLGLILFDWLRQLQDFRUURVLRQSLW:LWKUHJDUGWRWKH
SRVWXODWHGGRPLQDQFHRI)H22+ FI)LJXUH>&@ ZHSURSRVHWKHUHGR[UHDFWLRQ SRVWXODWHGGRPLQDQFHRI)H22+ FI)LJXUH>&@ ZHSURSRVHWKHUHGR[UHDFWLRQ

)H   + 2  2  → )H22+  +  ( Δ* 
−  N- )  >@ )H   + 2  2  → )H22+  +  ( Δ* 
−  N- )  >@

DVDQDOWHUQDWLYHWRWKHUHGR[UHDFWLRQ>@OHDGLQJWRGHSOHWLRQRIR[\JHQ DVDQDOWHUQDWLYHWRWKHUHGR[UHDFWLRQ>@OHDGLQJWRGHSOHWLRQRIR[\JHQ
,QDGGLWLRQWRWKHUHGR[UHDFWLRQ>@ZKLFKDOUHDG\LQYROYHVDFLGLILFDWLRQZHVXJ ,QDGGLWLRQWRWKHUHGR[UHDFWLRQ>@ZKLFKDOUHDG\LQYROYHVDFLGLILFDWLRQZHVXJ
JHVWWKDWLQSULQFLSOHDOOPHQWLRQHGDQRGLFUHDFWLRQVFRUUHVSRQGLQJWRWKHHTXLOLEULXP JHVWWKDWLQSULQFLSOHDOOPHQWLRQHGDQRGLFUHDFWLRQVFRUUHVSRQGLQJWRWKHHTXLOLEULXP
OLQHVDERYHQHXWUDOS+DQGLQWKHYLFLQLW\RIWKH K\GURJHQOLQHFDQFRQWULEXWHWRSLW OLQHVDERYHQHXWUDOS+DQGLQWKHYLFLQLW\RIWKH K\GURJHQOLQH FDQ FRQWULEXWHWRSLW
DFLGLILFDWLRQ VLQFH PRVW RI WKHVH UHDFWLRQV SURGXFH K\GURJHQ LRQV 7DNLQJ LQWR DF DFLGLILFDWLRQ VLQFH PRVW RI WKHVH UHDFWLRQV SURGXFH K\GURJHQ LRQV 7DNLQJ LQWR DF
FRXQW WKH GHSOHWLRQ RI R[\JHQ ZH WKLQN WKDW LQ SDUWLFXODU WKH KDOIFHOO UHDFWLRQV GH FRXQW WKH GHSOHWLRQ RI R[\JHQ ZH WKLQN WKDW LQ SDUWLFXODU WKH KDOIFHOO UHDFWLRQV GH
VFULELQJ WKH IRUPDWLRQ RI ELK\SRIHUULWH LRQ ZKLFK DUH RWKHUZLVH RI UDWKHU PDUJLQDO VFULELQJ WKH IRUPDWLRQ RI ELK\SRIHUULWH LRQ ZKLFK DUH RWKHUZLVH RI UDWKHU PDUJLQDO
LPSRUWDQFH FI6HFWLRQ  LPSRUWDQFH FI6HFWLRQ 

)H + +  2 → +)H2 − + +  + H − (( 
 =  P96+( )  >@ )H + +  2 → +)H2 − + +  + H − (( 
 =  P96+( )  >@

)H2  + +  2 + H− → +)H2 − + + + (( 


 = −  P96+( )  >@ )H2  + +  2 + H− → +)H2 − + + + (( 
 = −  P96+( )  >@

)H  2 + +  2 + H − → +)H2 − (( 
 = −  P96+( )  >@ )H  2 + +  2 + H − → +)H2 − (( 
 = −  P96+( )  >@

FRXOGSOD\DPDMRUSDUWLQWKHLQLWLDODFLGLILFDWLRQRIWKHSLW FI)LJXUH>&@ )H2 FRXOGSOD\DPDMRUSDUWLQWKHLQLWLDODFLGLILFDWLRQRIWKHSLW FI)LJXUH>&@ )H2


DQG)H2DUHKHQFHQRWFRQVLGHUHGDVIDYRXUHGSURGXFWVEXWDVSULQFLSDOFRQVWLWX DQG)H2DUHKHQFHQRWFRQVLGHUHGDVIDYRXUHGSURGXFWVEXWDVSULQFLSDOFRQVWLWX
HQWVRIWKHH[LVWLQJSDVVLYHOD\HU FI6HFWLRQ ZKLFKLVFRQVXPHGLQWKHSURF HQWVRIWKHH[LVWLQJSDVVLYHOD\HU FI6HFWLRQ ZKLFKLVFRQVXPHGLQWKHSURF
HVV,QFRQWUDVWWRDOORWKHUFRUURVLRQVWDWHVGHVFULEHGLQWKLV&KDSWHUZHDVVXPHK\ HVV,QFRQWUDVWWRDOORWKHUFRUURVLRQVWDWHVGHVFULEHGLQWKLV&KDSWHUZHDVVXPHK\
GURJHQLRQUHGXFWLRQWRFRQWULEXWHWRWKHRYHUDOOFDWKRGLFSURFHVVHVVLQFHWKHGHSOH GURJHQLRQUHGXFWLRQWRFRQWULEXWHWRWKHRYHUDOOFDWKRGLFSURFHVVHVVLQFHWKHGHSOH
WLRQRIR[\JHQDQGDFLGLILFDWLRQLQWKHSLWDUHFRQVLGHUHGWRSURYLGHIRUWKHUHTXLUHG WLRQRIR[\JHQDQGDFLGLILFDWLRQLQWKHSLWDUHFRQVLGHUHGWRSURYLGHIRUWKHUHTXLUHG
WKHUPRG\QDPLFFRQGLWLRQV FI6HFWLRQ  WKHUPRG\QDPLFFRQGLWLRQV FI6HFWLRQ 
7KH SURSRVHG PRGHO IRU FKORULGH LQGXFHG FRUURVLRQ UHODWHV WR WKH SURSDJDWLRQ VWDJH 7KH SURSRVHG PRGHO IRU FKORULGH LQGXFHG FRUURVLRQ UHODWHV WR WKH SURSDJDWLRQ VWDJH
VXEVHTXHQWWRLQLWLDOSLWDFLGLILFDWLRQDQGFRYHUVERWKWKHIRUPDWLRQRIJUHHQUXVWDQG VXEVHTXHQWWRLQLWLDOSLWDFLGLILFDWLRQDQGFRYHUVERWKWKHIRUPDWLRQRIJUHHQUXVWDQG
WKHRXWZDUGVGLIIXVLRQRIGLVVROYHGLURQVSHFLHV,WLVEDVHGRQWKHDERYHWKHRU\DGGL WKHRXWZDUGVGLIIXVLRQRIGLVVROYHGLURQVSHFLHV,WLVEDVHGRQWKHDERYHWKHRU\DGGL
WLRQDO WKHUPRG\QDPLF FRQVLGHUDWLRQV DQG H[SHULPHQWDO REVHUYDWLRQV 7KLV PRGHO LV WLRQDO WKHUPRG\QDPLF FRQVLGHUDWLRQV DQG H[SHULPHQWDO REVHUYDWLRQV 7KLV PRGHO LV
GHVFULEHGLQGHWDLOLQWKHIROORZLQJWRH[HPSOLI\WKHEHQHILWVRIWKHUPRG\QDPLFFRQ GHVFULEHGLQGHWDLOLQWKHIROORZLQJWRH[HPSOLI\WKHEHQHILWVRIWKHUPRG\QDPLFFRQ
VLGHUDWLRQVEDVHGRQWKH3RXUEDL[GLDJUDPVDQGUHDFWLRQPHFKDQLVPV VLGHUDWLRQVEDVHGRQWKH3RXUEDL[GLDJUDPVDQGUHDFWLRQPHFKDQLVPV
7KHWKHUPRG\QDPLFFRQGLWLRQVIRUWKHSURSRVHGSURSDJDWLRQPRGHO DUH LGHQWLILHG LQ 7KHWKHUPRG\QDPLFFRQGLWLRQVIRUWKHSURSRVHGSURSDJDWLRQPRGHO DUH LGHQWLILHG LQ
)LJXUH>%@ZKLOH)LJXUH>$@LOOXVWUDWHVRXUSURSRVHGDGDSWDWLRQRIWKHUHS )LJXUH>%@ZKLOH)LJXUH>$@LOOXVWUDWHVRXUSURSRVHGDGDSWDWLRQRIWKHUHS
UHVHQWDWLRQRIFRUURVLRQLQLWLDWLRQLQFKORULGHFRQWDPLQDWHGFRQFUHWHE\SLWWLQJSRWHQ UHVHQWDWLRQRIFRUURVLRQLQLWLDWLRQLQFKORULGHFRQWDPLQDWHGFRQFUHWHE\SLWWLQJSRWHQ
WLDOFXUYHV WLDOFXUYHV

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

 
í í
)LJXUH )H&O+2µ0(3'¶EDVHGRQ7DEOHDQG)HLD  PRO/DQG&OLD )LJXUH )H&O+2µ0(3'¶EDVHGRQ7DEOHDQG)HLD  PRO/DQG&OLD
  PRO/ )H&O ZKLFK LV IDYRXUHG RYHU )H DW KLJKHU &OLD LV LQ   PRO/ )H&O ZKLFK LV IDYRXUHG RYHU )H DW KLJKHU &OLD LV LQ
FOXGHGDVDQDOWHUQDWLYHVSHFLHVLQWKHDVVRFLDWHGVWDELOLW\GRPDLQ>$@ FOXGHGDVDQDOWHUQDWLYHVSHFLHVLQWKHDVVRFLDWHGVWDELOLW\GRPDLQ>$@
,GHQWLILFDWLRQRISLWWLQJSRWHQWLDOVIRUFRUURVLRQLQLWLDWLRQEDVHGRQGLI ,GHQWLILFDWLRQRISLWWLQJSRWHQWLDOVIRUFRUURVLRQLQLWLDWLRQEDVHGRQGLI
IHUHQWFKORULGHFRQWHQWVEDVHGRQSLWWLQJSRWHQWLDOFXUYHVDIWHU>1LOVVRQ IHUHQWFKORULGHFRQWHQWVEDVHGRQSLWWLQJSRWHQWLDOFXUYHVDIWHU>1LOVVRQ
HWDO  6DQGEHUJ @ >%@ ,GHQWLILFDWLRQ RI GLIIHUHQW WKHUPR HWDO  6DQGEHUJ @ >%@ ,GHQWLILFDWLRQ RI GLIIHUHQW WKHUPR
G\QDPLFVWDWHVFRQFHUQLQJWKHSURSRVHGPRGHOIRUFRUURVLRQSURSDJD G\QDPLFVWDWHVFRQFHUQLQJWKHSURSRVHGPRGHOIRUFRUURVLRQSURSDJD
WLRQ WLRQ
)LJXUH  >$@ H[HPSOLILHV D LQ RXU RSLQLRQ WKHUPRG\QDPLFDOO\ PRUH FRQVLVWHQW )LJXUH  >$@ H[HPSOLILHV D LQ RXU RSLQLRQ WKHUPRG\QDPLFDOO\ PRUH FRQVLVWHQW
UHSUHVHQWDWLRQ RI FRUURVLRQ LQLWLDWLRQ LQ FKORULGH FRQWDPLQDWHGFRQFUHWHWKDQWKHRQH UHSUHVHQWDWLRQ RI FRUURVLRQ LQLWLDWLRQ LQ FKORULGH FRQWDPLQDWHGFRQFUHWHWKDQWKHRQH
VKRZQLQ)LJXUH>$@,QVWHDGRIVXSHULPSRVLQJWKHSLWWLQJSRWHQWLDOFXUYHVRQWKH VKRZQLQ)LJXUH>$@,QVWHDGRIVXSHULPSRVLQJWKHSLWWLQJSRWHQWLDOFXUYHVRQWKH
)H+2V\VWHP>1LOVVRQHWDO6DQGEHUJ@ZHSURSRVHWRVXSHULPSRVHWKH )H+2V\VWHP>1LOVVRQHWDO6DQGEHUJ@ZHSURSRVHWRVXSHULPSRVHWKH
FXUYHVRQWKH)H&O+2µ0(3'¶:HFRQVLGHUWKLVDSSURDFKWREHDSSURSULDWHEH FXUYHVRQWKH)H&O+2µ0(3'¶:HFRQVLGHUWKLVDSSURDFKWREHDSSURSULDWHEH
FDXVH LW WDNHV WKH WKHUPRG\QDPLF HIIHFW RI FKORULGH RQ WKH )H+2 V\VWHP LQWR GXH FDXVH LW WDNHV WKH WKHUPRG\QDPLF HIIHFW RI FKORULGH RQ WKH )H+2 V\VWHP LQWR GXH
FRQVLGHUDWLRQDQGKHQFHFORVHVWKHJDSEHWZHHQFRUURVLRQLQLWLDWLRQDQGSURSDJDWLRQ FRQVLGHUDWLRQDQGKHQFHFORVHVWKHJDSEHWZHHQFRUURVLRQLQLWLDWLRQDQGSURSDJDWLRQ
)LJXUH>%@LGHQWLILHVWKHGLIIHUHQWWKHUPRG\QDPLFVWDWHVLHFDVH $ WR ' IRU )LJXUH>%@LGHQWLILHVWKHGLIIHUHQWWKHUPRG\QDPLFVWDWHVLHFDVH $ WR ' IRU
WKH SURSRVHG PHFKDQLVP ZKLFK LV GHVFULEHG EDVHG RQ WKHVH FDVHV DQG WKH DUURZV WKH SURSRVHG PHFKDQLVP ZKLFK LV GHVFULEHG EDVHG RQ WKHVH FDVHV DQG WKH DUURZV
LGHQWLI\LQJ UHDFWLRQV EHWZHHQ WKHP 7KH DOWHUQDWLYH IRUPDWLRQ RI IHUURXV FKORULGH DW LGHQWLI\LQJ UHDFWLRQV EHWZHHQ WKHP 7KH DOWHUQDWLYH IRUPDWLRQ RI IHUURXV FKORULGH DW
KLJKHU FKORULGH FRQFHQWUDWLRQ DERYH  PRO/  ZKLFK LV DOVR LQGLFDWHG LQ )LJXUH KLJKHU FKORULGH FRQFHQWUDWLRQ DERYH  PRO/  ZKLFK LV DOVR LQGLFDWHG LQ )LJXUH
>$@DQG>%@LVFRYHUHGE\LQFOXGLQJWKHDVVRFLDWHGUHDFWLRQVIRUERWK)HDQG >$@DQG>%@LVFRYHUHGE\LQFOXGLQJWKHDVVRFLDWHGUHDFWLRQVIRUERWK)HDQG
)H&OLQWKHPRGHO )H&OLQWKHPRGHO
,QLWLDOO\DS+RIDERXWDQGDQµ(FRUU¶RIDURXQGíP96+(DUHDVVXPHGVHHFDVH ,QLWLDOO\DS+RIDERXWDQGDQµ(FRUU¶RIDURXQGíP96+(DUHDVVXPHGVHHFDVH
$ LQ)LJXUH>%@7KHDFLGLI\LQJUHGR[UHDFWLRQ>@ $ LQ)LJXUH>%@7KHDFLGLI\LQJUHGR[UHDFWLRQ>@

)H   + 2  2  → )H22+  +  ( Δ* 
−  N- )  >@ )H   + 2  2  → )H22+  +  ( Δ* 
−  N- )  >@

LVWKHUPRG\QDPLFDOO\SRVVLEOHLQWKLVVWDWH,QFDVHRIKLJKHUFKORULGHFRQFHQWUDWLRQV LVWKHUPRG\QDPLFDOO\SRVVLEOHLQWKLVVWDWH,QFDVHRIKLJKHUFKORULGHFRQFHQWUDWLRQV
DERYH&OLD PRO/ DQDOWHUQDWLYHUHDFWLRQWR>@LV DERYH&OLD PRO/ DQDOWHUQDWLYHUHDFWLRQWR>@LV

)H&O  +  2  2  → )H22+  +  + &O− ( Δ* 


−  N- )  >@ )H&O  +  2  2  → )H22+  +  + &O− ( Δ* 
−  N- )  >@

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV

:LWKDYDLODELOLW\RIR[\JHQµ(FRUU¶LVVKLIWHGLQWRWKHVWDELOLW\GRPDLQRI)H22+ FI :LWKDYDLODELOLW\RIR[\JHQµ(FRUU¶LVVKLIWHGLQWRWKHVWDELOLW\GRPDLQRI)H22+ FI


FDVH % LQ)LJXUH>%@ DQGGHSHQGLQJRQWKHFKORULGHFRQFHQWUDWLRQDSRUWLRQRI FDVH % LQ)LJXUH>%@ DQGGHSHQGLQJRQWKHFKORULGHFRQFHQWUDWLRQDSRUWLRQRI
WKH)HRU)H&OLVR[LGLVHGWR)H22+DVGHVFULEHGE\WKHUHGR[UHDFWLRQ>@RU WKH)HRU)H&OLVR[LGLVHGWR)H22+DVGHVFULEHGE\WKHUHGR[UHDFWLRQ>@RU
>@%RWKUHDFWLRQVSURGXFHK\GURJHQLRQVOHDGLQJWRDGHFUHDVHLQS+RIWKHVXU >@%RWKUHDFWLRQVSURGXFHK\GURJHQLRQVOHDGLQJWRDGHFUHDVHLQS+RIWKHVXU
URXQGLQJFRQFUHWH7KHHIIHFWRIWKLVDFLGLILFDWLRQRQWKHXQR[LGLVHGSRUWLRQRI)HRU URXQGLQJFRQFUHWH7KHHIIHFWRIWKLVDFLGLILFDWLRQRQWKHXQR[LGLVHGSRUWLRQRI)HRU
)H&OLVLOOXVWUDWHGE\ FDVH & LQ)LJXUH>%@$GHFUHDVHWRDS+RIDERXW )H&OLVLOOXVWUDWHGE\ FDVH & LQ)LJXUH>%@$GHFUHDVHWRDS+RIDERXW
ZKLFKLVUHJDUGHGWREHOLNHO\VXUSDVVHGLVDVVXPHG$WWKHS+RIDQGWKHSUHV ZKLFKLVUHJDUGHGWREHOLNHO\VXUSDVVHGLVDVVXPHG$WWKHS+RIDQGWKHSUHV
HQFHRIFKORULGHLRQVDQGR[\JHQDQRWKHUR[LGDWLRQUHDFWLRQLVWKHUPRG\QDPLFSRVVL HQFHRIFKORULGHLRQVDQGR[\JHQDQRWKHUR[LGDWLRQUHDFWLRQLVWKHUPRG\QDPLFSRVVL
EOH WR WDNH SODFH LQYROYLQJ IRUPDWLRQ RI K\GUR[\O LRQV 'HSHQGLQJ RQ WKH FKORULGH EOH WR WDNH SODFH LQYROYLQJ IRUPDWLRQ RI K\GUR[\O LRQV 'HSHQGLQJ RQ WKH FKORULGH
FRQFHQWUDWLRQWKLVUHGR[UHDFWLRQLVHLWKHUGHVFULEHGE\ FRQFHQWUDWLRQWKLVUHGR[UHDFWLRQLVHLWKHUGHVFULEHGE\

)H   &O −  2   +  2 → )H&O    2+ − ( Δ* −  N- )  >@ )H   &O −  2   +  2 → )H&O    2+ − ( Δ* −  N- )  >@

RULQFDVHRIKLJKHUFKORULGHFRQFHQWUDWLRQVE\ RULQFDVHRIKLJKHUFKORULGHFRQFHQWUDWLRQVE\

)H&O   &O −  2   +  2 → )H&O    2+ − ( Δ* 


−  N- )  >@ )H&O   &O −  2   +  2 → )H&O    2+ − ( Δ* 
−  N- )  >@

$WWKLVS+WKHR[LGDWLRQRI)HRU)H&OZLWKDYDLODELOLW\RI&OíDQG2LVHTXLYDOHQW $WWKLVS+WKHR[LGDWLRQRI)HRU)H&OZLWKDYDLODELOLW\RI&OíDQG2LVHTXLYDOHQW
WRDUDLVHRIµ(FRUU¶ZKLFKIDYRXUVWKHIRUPDWLRQRIVROXEOH)H&O FDVH ' LQ)LJXUH WRDUDLVHRIµ(FRUU¶ZKLFKIDYRXUVWKHIRUPDWLRQRIVROXEOH)H&O FDVH ' LQ)LJXUH
>%@ $WWKHVDPHWLPHWKHVXUURXQGLQJFRQFUHWHH[SHULHQFHVDUDLVHLQS+GXHWR >%@ $WWKHVDPHWLPHWKHVXUURXQGLQJFRQFUHWHH[SHULHQFHVDUDLVHLQS+GXHWR
WKH SURGXFWLRQ RI K\GUR[\O LRQV LQ >@ RU >@ :LWK DONDOLQLVDWLRQ RI WKH VXU WKH SURGXFWLRQ RI K\GUR[\O LRQV LQ >@ RU >@ :LWK DONDOLQLVDWLRQ RI WKH VXU
URXQGLQJ FRQFUHWH RU GLIIXVLRQ RI GLVVROYHG )H RU )H&O LQWR UHJLRQV RI D S+ WKDW URXQGLQJ FRQFUHWH RU GLIIXVLRQ RI GLVVROYHG )H RU )H&O LQWR UHJLRQV RI D S+ WKDW
H[FHHGVWKHHTXLOLEULXPOLQHEHWZHHQ)H&ODQG)H22+LQµ0(3'¶LQ )LJXUH H[FHHGVWKHHTXLOLEULXPOLQHEHWZHHQ)H&ODQG)H22+LQµ0(3'¶LQ )LJXUH
>%@R[LGDWLRQRI)HRU)H&OOHDGWRIRUPDWLRQRI)H22+ FIUHGR[UHDFWLRQ>@ >%@R[LGDWLRQRI)HRU)H&OOHDGWRIRUPDWLRQRI)H22+ FIUHGR[UHDFWLRQ>@
RU>@ 7KLVLVLOOXVWUDWHGE\WKHDUURZIURP FDVH & WRZDUGVFDVH % LQ)LJXUH RU>@ 7KLVLVLOOXVWUDWHGE\WKHDUURZIURP FDVH & WRZDUGVFDVH % LQ)LJXUH
>%@ >%@
$FKDQJHLQVSHFLHVIURP)H22+WR)H&OLQWKHVDPHR[LGDWLRQVWDWHLVWKHUPRG\ $FKDQJHLQVSHFLHVIURP)H22+WR)H&OLQWKHVDPHR[LGDWLRQVWDWHLVWKHUPRG\
QDPLFDOO\GHVFULEHGE\WKHDFLGEDVHUHDFWLRQ QDPLFDOO\GHVFULEHGE\WKHDFLGEDVHUHDFWLRQ

)H22+  +   &O − → )H&O   +  2 ( Δ* 


−  N- )  >@ )H22+  +   &O − → )H&O   +  2 ( Δ* 
−  N- )  >@

7KLV UHDFWLRQ FRUUHVSRQGV WR WKH W\SH ,,, HTXLOLEULXP OLQH YHUWLFDO OLQH FI 6HFWLRQ 7KLV UHDFWLRQ FRUUHVSRQGV WR WKH W\SH ,,, HTXLOLEULXP OLQH YHUWLFDO OLQH FI 6HFWLRQ
 EHWZHHQ)H&OWR)H22+DWWKHS+DURXQGLQ)LJXUH>%@,QWKHFRQ  EHWZHHQ)H&OWR)H22+DWWKHS+DURXQGLQ)LJXUH>%@,QWKHFRQ
VLGHUHGV\VWHP)H22+LVWKHUPRG\QDPLFDOO\IDYRXUHGWREHWUDQVIRUPHGWR)H&ODW VLGHUHGV\VWHP)H22+LVWKHUPRG\QDPLFDOO\IDYRXUHGWREHWUDQVIRUPHGWR)H&ODW
S+YDOXHVEHORZ+RZHYHUZHDVVXPHWKDW)H22+SUHFLSLWDWHGLQFRQFUHWHLVDO S+YDOXHVEHORZ+RZHYHUZHDVVXPHWKDW)H22+SUHFLSLWDWHGLQFRQFUHWHLVDO
PRVWLQVROXEOH$PRQJRWKHUVWKLVLPSRUWDQWNLQHWLFDVSHFWLVDSSOLHGLQFKHPLFDOFR PRVWLQVROXEOH$PRQJRWKHUVWKLVLPSRUWDQWNLQHWLFDVSHFWLVDSSOLHGLQFKHPLFDOFR
DJXODWLRQ SURFHVVHV LQ ZDVWH ZDWHU WUHDWPHQW >,6$  )DXVW  $O\ @ :H DJXODWLRQ SURFHVVHV LQ ZDVWH ZDWHU WUHDWPHQW >,6$  )DXVW  $O\ @ :H
YHULILHGWKLVQRWLRQE\DVLPSOHH[SHULPHQWZKLFKLVLOOXVWUDWHGLQ)LJXUH YHULILHGWKLVQRWLRQE\DVLPSOHH[SHULPHQWZKLFKLVLOOXVWUDWHGLQ)LJXUH

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

 
)LJXUH 6LPSOH WHVW WR GHWHUPLQH WKH VROXELOLW\ RI )H22+ >$@ %HDNHU ZLWK )LJXUH 6LPSOH WHVW WR GHWHUPLQH WKH VROXELOLW\ RI )H22+ >$@ %HDNHU ZLWK
)H&OVROXWLRQ>%@$GGLWLRQRI1D2+WRVROXWLRQ>&@6ROXWLRQDWS+ )H&OVROXWLRQ>%@$GGLWLRQRI1D2+WRVROXWLRQ>&@6ROXWLRQDWS+
ZLWKEURZQLVKFRORXULQGLFDWLQJSUHFLSLWDWLRQRI)H22+>'@$GGL ZLWKEURZQLVKFRORXULQGLFDWLQJSUHFLSLWDWLRQRI)H22+>'@$GGL
WLRQRI+&OWRVROXWLRQ>(@6ROXWLRQDWS+LVGLOXWHGEXWEURZQLVK WLRQRI+&OWRVROXWLRQ>(@6ROXWLRQDWS+LVGLOXWHGEXWEURZQLVK
FRORXUUHPDLQVLQGLFDWLQJWKDW)H22+LVGLIILFXOWWRGLVVROYH FRORXUUHPDLQVLQGLFDWLQJWKDW)H22+LVGLIILFXOWWRGLVVROYH
$VLOOXVWUDWHGLQ)LJXUH>$@DQG>%@IHUULFFKORULGHVROXWLRQZDVDONDOLQLVHGE\ $VLOOXVWUDWHGLQ)LJXUH>$@DQG>%@IHUULFFKORULGHVROXWLRQZDVDONDOLQLVHGE\
DGGLWLRQRIVRGLXPK\GUR[LGHZKLFKOHGWRSUHFLSLWDWLRQRI)H22+7KLVLVLQGLFDWHG DGGLWLRQRIVRGLXPK\GUR[LGHZKLFKOHGWRSUHFLSLWDWLRQRI)H22+7KLVLVLQGLFDWHG
E\WKHEURZQLVKFRORXURIWKHVROXWLRQDWS+VHH)LJXUH>&@DQGFDQEHGH E\WKHEURZQLVKFRORXURIWKHVROXWLRQDWS+VHH)LJXUH>&@DQGFDQEHGH
VFULEHG LQFRUUHVSRQGHQFHZLWK>@ E\WKHDFLGEDVHUHDFWLRQ VFULEHG LQFRUUHVSRQGHQFHZLWK>@ E\WKHDFLGEDVHUHDFWLRQ

)H&O + 2+ − → )H22+ + &O − + +  2 ( Δ* 


= −  N- )  >@ )H&O + 2+ − → )H22+ + &O − + +  2 ( Δ* 
= −  N- )  >@

7KHVROXWLRQZDVWKHQDFLGLILHGE\DGGLWLRQRIK\GURFKORULFDFLGVHH)LJXUH>'@ 7KHVROXWLRQZDVWKHQDFLGLILHGE\DGGLWLRQRIK\GURFKORULFDFLGVHH)LJXUH>'@
7KH VROXWLRQ DW S+  ZDV GLOXWHG EXW WKH HQGXULQJ EURZQLVK FRORXU FRQILUPHG WKDW 7KH VROXWLRQ DW S+  ZDV GLOXWHG EXW WKH HQGXULQJ EURZQLVK FRORXU FRQILUPHG WKDW
SUHFLSLWDWHG )H22+ LV GLIILFXOW WR GLVVROYH HYHQ LQ YHU\ DFLG PHGLD $FFRUGLQJO\ SUHFLSLWDWHG )H22+ LV GLIILFXOW WR GLVVROYH HYHQ LQ YHU\ DFLG PHGLD $FFRUGLQJO\
WKHUHLVQRDUURZSRLQWLQJIURPFDVH % WRZDUGVFDVH ' LQ)LJXUH>%@ WKHUHLVQRDUURZSRLQWLQJIURPFDVH % WRZDUGVFDVH ' LQ)LJXUH>%@
7KH WZR DOWHUQDWLYH UHGR[ UHDFWLRQV>@ DQG>@ IRUP )H&O )HUULF FKORULGH LQ 7KH WZR DOWHUQDWLYH UHGR[ UHDFWLRQV>@ DQG>@ IRUP )H&O )HUULF FKORULGH LQ
IRUPRIWKHOLTXLGFRPSRXQG)H&OLVNQRZQWREHDYHU\UHDFWLYHHWFKLQJDJHQWIRU IRUPRIWKHOLTXLGFRPSRXQG)H&OLVNQRZQWREHDYHU\UHDFWLYHHWFKLQJDJHQWIRU
PHWDOV HJ IRU SULQWHG FLUFXLW ERDUGV 3&%  DQG VWDLQOHVV VWHHOV >:DONHU  7DUQ PHWDOV HJ IRU SULQWHG FLUFXLW ERDUGV 3&%  DQG VWDLQOHVV VWHHOV >:DONHU  7DUQ
@ +RZHYHU WKLV FRPSRXQG GRHV QRW H[KLELW WKHUPRG\QDPLF WHQGHQF\ WR EH @ +RZHYHU WKLV FRPSRXQG GRHV QRW H[KLELW WKHUPRG\QDPLF WHQGHQF\ WR EH
IRUPHG IRUPHG

)H&O+ + &O− → )H&O ( Δ* 


=  N- )  >@ )H&O+ + &O− → )H&O ( Δ* 
=  N- )  >@

<HWZHDVVXPHWKDW)H&OKDVVLPLODUHWFKLQJSURSHUWLHVRQLURQDV)H&O7KHGLVVR <HWZHDVVXPHWKDW)H&OKDVVLPLODUHWFKLQJSURSHUWLHVRQLURQDV)H&O7KHGLVVR
OXWLRQRI)HE\)H&OFDQIRULQVWDQFHEHGHVFULEHGE\WKHUHGR[UHDFWLRQ OXWLRQRI)HE\)H&OFDQIRULQVWDQFHEHGHVFULEHGE\WKHUHGR[UHDFWLRQ

)H&O   )H → )H  + &O − ( Δ* 


−  N- )  >@ )H&O   )H → )H  + &O − ( Δ* 
−  N- )  >@

(WFKLQJRFFXUVXQGHUUHGXFWLRQRIIHUULFLRQLRQVDQGGLVVROXWLRQRILURQWRIRUPIHU (WFKLQJRFFXUVXQGHUUHGXFWLRQRIIHUULFLRQLRQVDQGGLVVROXWLRQRILURQWRIRUPIHU
URXVLRQ2QH)HDWRPLVGLVVROYHGE\WZR)H&OSURGXFLQJWKUHH)HXQGHUVHSDUD URXVLRQ2QH)HDWRPLVGLVVROYHGE\WZR)H&OSURGXFLQJWKUHH)HXQGHUVHSDUD
WLRQRIWKHFKORULGHLRQVIURPWKHFRPSOH[7KHUHIRUHERWKWKH)HDQGWKH&Oí LRQV WLRQRIWKHFKORULGHLRQVIURPWKHFRPSOH[7KHUHIRUHERWKWKH)HDQGWKH&Oí LRQV
DUHDYDLODEOHWREHRQFHPRUHR[LGLVHGWR)H&OFI>@DQG>@ DUHDYDLODEOHWREHRQFHPRUHR[LGLVHGWR)H&OFI>@DQG>@
:H DVVXPH WKDW E\ WKH DERYH GHVFULEHG UHDFWLRQ PHFKDQLVP D VHOIFRQWDLQHG DXWR :H DVVXPH WKDW E\ WKH DERYH GHVFULEHG UHDFWLRQ PHFKDQLVP D VHOIFRQWDLQHG DXWR
FDWDO\WLF ORRSDVVNHWFKHGLQ)LJXUHLVHVWDEOLVKHG FDWDO\WLF ORRSDVVNHWFKHGLQ)LJXUHLVHVWDEOLVKHG

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV

 
)LJXUH 6NHWFK RI WKH SURSRVHG PHFKDQLVP IRU FKORULGH LQGXFHG FRUURVLRQ LQ )LJXUH 6NHWFK RI WKH SURSRVHG PHFKDQLVP IRU FKORULGH LQGXFHG FRUURVLRQ LQ
R[\JHQ GHSULYHG FRQFUHWH 7KH VNHWFK LOOXVWUDWHV WKH VHOIFRQWDLQHG R[\JHQ GHSULYHG FRQFUHWH 7KH VNHWFK LOOXVWUDWHV WKH VHOIFRQWDLQHG
ORRSEHWZHHQWKHR[LGDWLRQRI)H )H&O WR)H&ODQGWKHHWFKLQJ ORRSEHWZHHQWKHR[LGDWLRQRI)H )H&O WR)H&ODQGWKHHWFKLQJ
SURFHVVRI)HE\)H&OLQFRPELQDWLRQZLWKWKHDVVRFLDWHGDFLGLILFD SURFHVVRI)HE\)H&OLQFRPELQDWLRQZLWKWKHDVVRFLDWHGDFLGLILFD
WLRQDQGSRUHEORFNLQJE\SUHFLSLWDWLRQRI)H22+ WLRQDQGSRUHEORFNLQJE\SUHFLSLWDWLRQRI)H22+
$VLQGLFDWHGLQ)LJXUHWKHSURSRVHGPHFKDQLVPGRHVQRWUHTXLUHR[\JHQDWWKH $VLQGLFDWHGLQ)LJXUHWKHSURSRVHGPHFKDQLVPGRHVQRWUHTXLUHR[\JHQDWWKH
UHEDUVXUIDFH7KHUHDFWDQWVDUHGLVVROYHGLQWKHSRUHVROXWLRQDQGDVVXPHGWREHPR UHEDUVXUIDFH7KHUHDFWDQWVDUHGLVVROYHGLQWKHSRUHVROXWLRQDQGDVVXPHGWREHPR
ELOH FI6HFWLRQ VRWKDWR[LGDWLRQRI)H )H&O WR)H&OFDQRFFXUDWDQ\ ELOH FI6HFWLRQ VRWKDWR[LGDWLRQRI)H )H&O WR)H&OFDQRFFXUDWDQ\
ORFDWLRQ ZLWK VXIILFLHQW VXSSO\ RI R[\JHQ DQG D S+ EHORZ WKH HTXLOLEULXP OLQH RI ORFDWLRQ ZLWK VXIILFLHQW VXSSO\ RI R[\JHQ DQG D S+ EHORZ WKH HTXLOLEULXP OLQH RI
)H&O DQG )H22+ VHH )LJXUH  >%@ 7KH )H&O ZLOO GLIIXVH IURP WKH ORFDWLRQ )H&O DQG )H22+ VHH )LJXUH  >%@ 7KH )H&O ZLOO GLIIXVH IURP WKH ORFDWLRQ
ZKHUHLWLVSURGXFHGWRZDUGVWKHUHEDU7KHDQRGLFGLVVROXWLRQRI)HGRHVQRWUHTXLUH ZKHUHLWLVSURGXFHGWRZDUGVWKHUHEDU7KHDQRGLFGLVVROXWLRQRI)HGRHVQRWUHTXLUH
HJ WKH FDWKRGLF UHGXFWLRQ RI R[\JHQ VLQFH WKH UHGXFWLRQSURFHVV LVLQFRUSRUDWHG LQ HJ WKH FDWKRGLF UHGXFWLRQ RI R[\JHQ VLQFH WKH UHGXFWLRQSURFHVVLVLQFRUSRUDWHGLQ
WKHGLVVROXWLRQSURFHVVLWVHOI>@ WKHGLVVROXWLRQSURFHVVLWVHOI>@
+\GUR[\OLRQVDUHJHQHUDWHGLQWKHR[LGDWLRQUHDFWLRQIURP)H )H&O WR)H&OFI +\GUR[\OLRQVDUHJHQHUDWHGLQWKHR[LGDWLRQUHDFWLRQIURP)H )H&O WR)H&OFI
UHGR[UHDFWLRQV>@DQG>@DQGWKHVXUURXQGLQJDUHDH[SHULHQFHVDQLQFUHDVHLQ UHGR[UHDFWLRQV>@DQG>@DQGWKHVXUURXQGLQJDUHDH[SHULHQFHVDQLQFUHDVHLQ
S+7KHS+LQFUHDVHIDYRXUVR[LGDWLRQRI)H )H&O WR)H22+LQVWHDGRIR[LGDWLRQ S+7KHS+LQFUHDVHIDYRXUVR[LGDWLRQRI)H )H&O WR)H22+LQVWHDGRIR[LGDWLRQ
WR)H&ORQFHWKHS+RI FRUUHVSRQGLQJWRWKHHTXLOLEULXPOLQHEHWZHHQ)H&ODQG WR)H&ORQFHWKHS+RI FRUUHVSRQGLQJWRWKHHTXLOLEULXPOLQHEHWZHHQ)H&ODQG
)H22+ LVVXUSDVVHGVHH)LJXUH>%@2[LGDWLRQWR)H22+UHVXOWVLQSURGXFWLRQ )H22+ LVVXUSDVVHGVHH)LJXUH>%@2[LGDWLRQWR)H22+UHVXOWVLQSURGXFWLRQ
RI+ FI>@DQG>@ DQGWKHUHJLRQLVUHDFLGLILHGDVLOOXVWUDWHGLQ)LJXUH RI+ FI>@DQG>@ DQGWKHUHJLRQLVUHDFLGLILHGDVLOOXVWUDWHGLQ)LJXUH
&RQVHTXHQWO\WKHS+ZLOODOWHUQDWHDURXQGWKHHTXLOLEULXPS+RIDVLOOXVWUDWHGLQ &RQVHTXHQWO\WKHS+ZLOODOWHUQDWHDURXQGWKHHTXLOLEULXPS+RIDVLOOXVWUDWHGLQ
WKHµ0(3'¶LQ)LJXUH>%@ WKHµ0(3'¶LQ)LJXUH>%@
7KHS+DQGHTXLOLEULXPSRWHQWLDOUDQJHRIWKHSURSRVHGPHFKDQLVPIDOOVLQWRWKHFHQ 7KHS+DQGHTXLOLEULXPSRWHQWLDOUDQJHRIWKHSURSRVHGPHFKDQLVPIDOOVLQWRWKHFHQ
WUHRIWKHPHDVXUHGDQGSRVWXODWHGGDWDIURPWKHOLWHUDWXUHIRUWKHIRUPDWLRQRIµ*5¶ WUHRIWKHPHDVXUHGDQGSRVWXODWHGGDWDIURPWKHOLWHUDWXUHIRUWKHIRUPDWLRQRIµ*5¶
HJ>5HIDLW *pQLQ6DJRH&UHQWVLO *ODVVHU5HIDLW *pQLQ HJ>5HIDLW *pQLQ6DJRH&UHQWVLO *ODVVHU5HIDLW *pQLQ
5HIDLWHWDO*pQLQHWDO.ROHYDHWDO&H)U&R5pPD]HLOOHV 5HIDLWHWDO*pQLQHWDO.ROHYDHWDO&H)U&R5pPD]HLOOHV
5HIDLW@ DQGKHQFHLVVHHQDVDWKHUPRG\QDPLFFRQVLVWHQWGHVFULSWLRQ 5HIDLW@ DQGKHQFHLVVHHQDVDWKHUPRG\QDPLFFRQVLVWHQWGHVFULSWLRQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

:HSHUIRUPHGDQLQLWLDOYHULILFDWLRQRIDFLGLILFDWLRQDQGSUHFLSLWDWLRQ RI )H22+E\ :HSHUIRUPHGDQLQLWLDOYHULILFDWLRQRIDFLGLILFDWLRQDQGSUHFLSLWDWLRQ RI )H22+E\


PHDQV RI D VLPSOH H[SHULPHQW $V SUHVHQWHG LQ )LJXUH  >$@ DQG >%@ D FKORULGH PHDQV RI D VLPSOH H[SHULPHQW $V SUHVHQWHG LQ )LJXUH  >$@ DQG >%@ D FKORULGH
FRQWDPLQDWHG UHLQIRUFHG FRQFUHWH EORFN ZLWK D VHYHUHO\ FRUURGHG HPEHGGHG FDUERQ FRQWDPLQDWHG UHLQIRUFHG FRQFUHWH EORFN ZLWK D VHYHUHO\ FRUURGHG HPEHGGHG FDUERQ
VWHHOUHEDUZDVVSOLWSDUDOOHOWRWKHUHEDUOHDYLQJDERXWFPRIFRQFUHWHFRYHUDJHRQ VWHHOUHEDUZDVVSOLWSDUDOOHOWRWKHUHEDUOHDYLQJDERXWFPRIFRQFUHWHFRYHUDJHRQ
WKHVWHHO$IWHUWKHFOHDYDJHSKHQROSKWKDOHLQ FI6HFWLRQ ZDVDSSOLHGRQWRWKH WKHVWHHO$IWHUWKHFOHDYDJHSKHQROSKWKDOHLQ FI6HFWLRQ ZDVDSSOLHGRQWRWKH
VSOLWIDFHVHH)LJXUH>$@ VSOLWIDFHVHH)LJXUH>$@

 
)LJXUH 6SOLWFKORULGHFRQWDPLQDWHGUHLQIRUFHGFRQFUHWH EORFNZLWKDVHYHUHO\ )LJXUH 6SOLWFKORULGHFRQWDPLQDWHGUHLQIRUFHGFRQFUHWHEORFNZLWKDVHYHUHO\
FRUURGHG HPEHGGHG FDUERQ VWHHO UHEDU 6SHFLPHQ IURP >1\JDDUG FRUURGHG HPEHGGHG FDUERQ VWHHO UHEDU 6SHFLPHQ IURP >1\JDDUG
@>$@3KHQROSKWKDOHLQDSSOLHGRQVSOLWIDFH FI6HFWLRQ  @>$@3KHQROSKWKDOHLQDSSOLHGRQVSOLWIDFH FI6HFWLRQ 
DQGLGHQWLILFDWLRQRIUHJLRQVRILQWHUHVW>%@7UDFHVRIJUHHQUXVWDOVR DQGLGHQWLILFDWLRQRIUHJLRQVRILQWHUHVW>%@7UDFHVRIJUHHQUXVWDOVR
UHIHUUHGWRDVµ*5¶RQWKHVSOLWVXUIDFHEHIRUHDSSOLFDWLRQRISKHQRO UHIHUUHGWRDVµ*5¶RQWKHVSOLWVXUIDFHEHIRUHDSSOLFDWLRQRISKHQRO
SKWKDOHLQ SKWKDOHLQ
7KHLQGLFDWRUVKRZHGWKDWWKHS+LV DWOHDVW EHORZDS+RIDWOHDVW FI7DEOH 7KHLQGLFDWRUVKRZHGWKDWWKHS+LV DWOHDVW EHORZDS+RIDWOHDVW FI7DEOH
LQ6HFWLRQ LQGHVLJQDWHGDUHDV7KHVHDUHDVDSSHDUHGWRFRQQHFWWKHVRXUFHRI LQ6HFWLRQ LQGHVLJQDWHGDUHDV7KHVHDUHDVDSSHDUHGWRFRQQHFWWKHVRXUFHRI
FRUURVLRQ DW WKH UHEDU WR WKH UXVW VWDLQ RQ WKH RXWHU VXUIDFH LQ IRUP RI D SDWKZD\ FRUURVLRQ DW WKH UHEDU WR WKH UXVW VWDLQ RQ WKH RXWHU VXUIDFH LQ IRUP RI D SDWKZD\
ZKLFKLQGLFDWHVWKDWWKHGLVVROYHGIHUURXVLRQDSSURDFKHVWKHVXUIDFHE\GLIIXVLRQWR ZKLFKLQGLFDWHVWKDWWKHGLVVROYHGIHUURXVLRQDSSURDFKHVWKHVXUIDFHE\GLIIXVLRQWR
ZDUGVR[\JHQHQULFKHGDUHDV7KHREVHUYHGORZS+RIWKHSDWKEHWZHHQUHEDUDQGVXU ZDUGVR[\JHQHQULFKHGDUHDV7KHREVHUYHGORZS+RIWKHSDWKEHWZHHQUHEDUDQGVXU
IDFHLVDVVXPHGWREHGXHWR+IRUPHGLQWKHR[LGDWLRQRI)H )H&O WR)H22+FI IDFHLVDVVXPHGWREHGXHWR+IRUPHGLQWKHR[LGDWLRQRI)H )H&O WR)H22+FI
>@DQG>@7KHSDWKZD\VDSSHDUHGWREHOLPLWHGE\DERUGHUOLQH7KLVLVFRQ >@DQG>@7KHSDWKZD\VDSSHDUHGWREHOLPLWHGE\DERUGHUOLQH7KLVLVFRQ
VLGHUHGWREHGXHWR)H )H&O SUHFLSLWDWLQJDV)H22+ FI>@DQG>@ ZKHQ VLGHUHGWREHGXHWR)H )H&O SUHFLSLWDWLQJDV)H22+ FI>@DQG>@ ZKHQ
GLIIXVLQJRXWRIWKHDFLGLILHGDUHDWRZDUGVUHJLRQVZLWKDKLJKHUS+ FI)LJXUH  GLIIXVLQJRXWRIWKHDFLGLILHGDUHDWRZDUGVUHJLRQVZLWKDKLJKHUS+ FI)LJXUH 
DVDOVRH[HPSOLILHGWKURXJKWKHGLUHFWVKLIWEHWZHHQFDVH & DQG % LQWKHµ0(3'¶ DVDOVRH[HPSOLILHGWKURXJKWKHGLUHFWVKLIWEHWZHHQFDVH & DQG % LQWKHµ0(3'¶
LQ)LJXUH>%@:HDVVXPHWKDWWKLVRFFXUUHQFHOLPLWVQHXWUDOLVDWLRQRIWKHDFLGL LQ)LJXUH>%@:HDVVXPHWKDWWKLVRFFXUUHQFHOLPLWVQHXWUDOLVDWLRQRIWKHDFLGL
ILHG UHJLRQ WKURXJK D GHQVLILFDWLRQ DW WKH ³HTXLOLEULXP S+ OLQH´ WR IRUP DFLGLILHG ILHG UHJLRQ WKURXJK D GHQVLILFDWLRQ DW WKH ³HTXLOLEULXP S+ OLQH´ WR IRUP DFLGLILHG
SDWKZD\V2WKHUZLVHDODUJHTXDQWLW\RIK\GUR[\OLRQVZRXOGEHDYDLODEOHWRGLIIXVH SDWKZD\V2WKHUZLVHDODUJHTXDQWLW\RIK\GUR[\OLRQVZRXOGEHDYDLODEOHWRGLIIXVH
LQWRWKHDFLGLILHGDUHDIURPWKHFRQFUHWHEXONUHPDLQLQJDWKLJKS+ LQWRWKHDFLGLILHGDUHDIURPWKHFRQFUHWHEXONUHPDLQLQJDWKLJKS+

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV

,Q DFFRUGDQFH ZLWK WKH µ0(3'¶ LQ )LJXUH  >%@ IRUPDWLRQ RI LURQ R[LGHV RU K\ ,Q DFFRUGDQFH ZLWK WKH µ0(3'¶ LQ )LJXUH  >%@ IRUPDWLRQ RI LURQ R[LGHV RU K\
GUR[LGHV LV LPSRVVLEOH LQ WKH YLFLQLW\ RI WKH UHEDU GXH WR WKH ORZ S+ +HQFH )H GUR[LGHV LV LPSRVVLEOH LQ WKH YLFLQLW\ RI WKH UHEDU GXH WR WKH ORZ S+ +HQFH )H
)H&O  DQG )H&O ZLOO UHPDLQ LQ VROXWLRQ DQG IRUP WKH OLTXLG FRPSRXQG ZKLFK LV )H&O  DQG )H&O ZLOO UHPDLQ LQ VROXWLRQ DQG IRUP WKH OLTXLG FRPSRXQG ZKLFK LV
FRPPRQO\UHIHUUHGWRDVJUHHQUXVWRUµ*5¶)LJXUH>%@VKRZVWKHVSOLWIDFHRI FRPPRQO\UHIHUUHGWRDVJUHHQUXVWRUµ*5¶)LJXUH>%@VKRZVWKHVSOLWIDFHRI
WKHFRQFUHWHEORFNLPPHGLDWHO\DIWHUFOHDYDJHEHIRUHDSSOLFDWLRQRIWKHSKHQROSKWKDO WKHFRQFUHWHEORFNLPPHGLDWHO\DIWHUFOHDYDJHEHIRUHDSSOLFDWLRQRIWKHSKHQROSKWKDO
HLQ7KHSUHGLFWHGOLTXLGJUHHQFRPSRXQGFRXOGEHFOHDUO\REVHUYHGWRHPHUJHIURP HLQ7KHSUHGLFWHGOLTXLGJUHHQFRPSRXQGFRXOGEHFOHDUO\REVHUYHGWRHPHUJHIURP
WKH SDWKZD\ 6LQFH VWDEOH LQ WKH DEVHQFH RI R[\JHQ RQO\ WKH OLTXLG LV LPPHGLDWHO\ WKH SDWKZD\ 6LQFH VWDEOH LQ WKH DEVHQFH RI R[\JHQ RQO\ WKH OLTXLG LV LPPHGLDWHO\
WUDQVIRUPHGWR)H22+DIWHUVSOLWWLQJ WUDQVIRUPHGWR)H22+DIWHUVSOLWWLQJ
7KHREVHUYDWLRQVRQWKHUHLQIRUFHGFRQFUHWHEORFNZHUHYHULILHGE\DQDO\VLQJWKHLQ 7KHREVHUYDWLRQVRQWKHUHLQIRUFHGFRQFUHWHEORFNZHUHYHULILHGE\DQDO\VLQJWKHLQ
VWUXPHQWHGPRUWDUVSHFLPHQVIURPµ7HVW,,¶ FI6HFWLRQ DWWKHHQGRIWKHLUH[ VWUXPHQWHGPRUWDUVSHFLPHQVIURPµ7HVW,,¶ FI6HFWLRQ DWWKHHQGRIWKHLUH[
SRVXUHSHULRGVE\UDLQERZLQGLFDWRU FI6HFWLRQ DQGµ('6¶HOHPHQWPDSSLQJ SRVXUHSHULRGVE\UDLQERZLQGLFDWRU FI6HFWLRQ DQGµ('6¶HOHPHQWPDSSLQJ
FI 6HFWLRQ  >('$;  )(, @  $ JULWEODVWHG FDUERQ VWHHO WHVW FI 6HFWLRQ  >('$;  )(, @  $ JULWEODVWHG FDUERQ VWHHO WHVW
VSHFLPHQ WKH FRUUHVSRQGLQJ IUHVK VDZQ IDFH FXW   DQG WKH VDZQVSOLW IDFH FXW VSHFLPHQ WKH FRUUHVSRQGLQJ IUHVK VDZQ IDFH FXW   DQG WKH VDZQVSOLW IDFH FXW
VSOLW  ZLWK UDLQERZ LQGLFDWRU DSSOLHG WR LW DUH VKRZQ LQ )LJXUH  >$@ >%@ DQG VSOLW  ZLWK UDLQERZ LQGLFDWRU DSSOLHG WR LW DUH VKRZQ LQ )LJXUH  >$@ >%@ DQG
>&@UHVSHFWLYHO\ >&@UHVSHFWLYHO\

 
)LJXUH >$@6HYHUHO\ FRUURGHG FKORULGH LQGXFHG  PRUWDUVSHFLPHQ ZLWK FHQ )LJXUH >$@6HYHUHO\ FRUURGHG FKORULGH LQGXFHG  PRUWDUVSHFLPHQ ZLWK FHQ
WUDO JULWEODVWHG FDUERQ VWHHO UHEDU ZLWKRXW HPEHGGHG µ((:¶ VSHFL WUDO JULWEODVWHG FDUERQ VWHHO UHEDU ZLWKRXW HPEHGGHG µ((:¶ VSHFL
PHQ³&%´FI6HFWLRQ DWWKHHQGRILWVH[SRVXUHSHULRG OHDG PHQ³&%´FI6HFWLRQ DWWKHHQGRILWVH[SRVXUHSHULRG OHDG
ZLUHV DQG 2ULQJ UHPRYHG  ,GHQWLILFDWLRQ RI UHEDU SRVLWLRQ DQG RI ZLUHV DQG 2ULQJ UHPRYHG  ,GHQWLILFDWLRQ RI UHEDU SRVLWLRQ DQG RI
VDZQIDFH FXWUHG DQGVDZQVSOLWIDFH FXWVSOLWEOXHJUHHQ >%@ VDZQIDFH FXWUHG DQGVDZQVSOLWIDFH FXWVSOLWEOXHJUHHQ >%@
)UHVK VDZQ IDFH FRUUHVSRQGLQJ WR FXW OLQH ZLWK µ*5¶ SURWUXGLQJ )UHVK VDZQ IDFH FRUUHVSRQGLQJ WR FXW OLQH ZLWK µ*5¶ SURWUXGLQJ
IURPWKHPRUWDUVWHHOLQWHUIDFH>&@6DZQVSOLWIDFHZLWK5DLQERZLQ IURPWKHPRUWDUVWHHOLQWHUIDFH>&@6DZQVSOLWIDFHZLWK5DLQERZLQ
GLFDWRU DSSOLHG FI 6HFWLRQ   5DQJHV RI S+ \HOORZ QXPEHUV  GLFDWRU DSSOLHG FI 6HFWLRQ   5DQJHV RI S+ \HOORZ QXPEHUV 
LQGLFDWHGRQVSOLWIDFHLQDFFRUGDQFHZLWKWKHFRORXUFRGHRIWKHUDLQ LQGLFDWHGRQVSOLWIDFHLQDFFRUGDQFHZLWKWKHFRORXUFRGHRIWKHUDLQ
ERZLQGLFDWRU FI7DEOHLQ6HFWLRQ ,GHQWLILFDWLRQRIPHDV ERZLQGLFDWRU FI7DEOHLQ6HFWLRQ ,GHQWLILFDWLRQRIPHDV
XUHPHQWSRLQWVXVHGIRUHOHPHQWPDSSLQJLHSLQNGRWLQORZS+DUHD XUHPHQWSRLQWVXVHGIRUHOHPHQWPDSSLQJLHSLQNGRWLQORZS+DUHD
FI )LJXUH  DQG )LJXUH   DQG WXUTXRLVH GRW LQ KLJK S+ DUHD FI )LJXUH  DQG )LJXUH   DQG WXUTXRLVH GRW LQ KLJK S+ DUHD
FI)LJXUH  FI)LJXUH 
$V PHQWLRQHG LQ 6HFWLRQ  WKH VXEPHUVHG PRUWDU VXUIDFH RI µ7HVW ,,¶ FRUUH $V PHQWLRQHG LQ 6HFWLRQ  WKH VXEPHUVHG PRUWDU VXUIDFH RI µ7HVW ,,¶ FRUUH
VSRQGHGWRRIWKHWRWDOVXUIDFHZKLFKFDQEHREVHUYHGE\VOLJKWO\GLIIHUHQWFRO VSRQGHGWRRIWKHWRWDOVXUIDFHZKLFKFDQEHREVHUYHGE\VOLJKWO\GLIIHUHQWFRO

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

RXURIWKHORZHUDQGWKHXSSHUPRUWDUSDUWRIWKHVSHFLPHQVKRZQLQ)LJXUH>$@ RXURIWKHORZHUDQGWKHXSSHUPRUWDUSDUWRIWKHVSHFLPHQVKRZQLQ)LJXUH>$@
7KHUXVWVWDLQRQWKHXQVXEPHUJHGPRUWDUVXUIDFHFORVHWRWKHDFU\OLFJODVVVHFWLRQ FI 7KHUXVWVWDLQRQWKHXQVXEPHUJHGPRUWDUVXUIDFHFORVHWRWKHDFU\OLFJODVVVHFWLRQ FI
6HFWLRQ LVHYLGHQW$VLOOXVWUDWHGE\WKHFXWOLQH UHG LQ)LJXUH>$@WKH 6HFWLRQ LVHYLGHQW$VLOOXVWUDWHGE\WKHFXWOLQH UHG LQ)LJXUH>$@WKH
VSHFLPHQZDVILUVWFXWKRUL]RQWDOO\ZLWKDGLDPRQGVDZMXVWEHQHDWKWKHDFU\OLFJODVV VSHFLPHQZDVILUVWFXWKRUL]RQWDOO\ZLWKDGLDPRQGVDZMXVWEHQHDWKWKHDFU\OLFJODVV
VHFWLRQ7KHFRUUHVSRQGLQJIUHVKVDZQIDFHRIWKHPRUWDUVSHFLPHQLVVKRZQLQ)LJXUH VHFWLRQ7KHFRUUHVSRQGLQJIUHVKVDZQIDFHRIWKHPRUWDUVSHFLPHQLVVKRZQLQ)LJXUH
>%@ZKHUHSURWUXVLRQRIOLTXLGµ*5¶IURPWKHSRUHVDQGLQSDUWLFXODUIURPWKH >%@ZKHUHSURWUXVLRQRIOLTXLGµ*5¶IURPWKHSRUHVDQGLQSDUWLFXODUIURPWKH
PRUWDUVWHHOLQWHUIDFHFDQEHFOHDUO\VHHQ)LJXUH>&@VKRZVWKHIDFHFRUUHVSRQG PRUWDUVWHHOLQWHUIDFHFDQEHFOHDUO\VHHQ)LJXUH>&@VKRZVWKHIDFHFRUUHVSRQG
LQJ WR WKH FRPELQHG FXWVSOLW IDFHDORQJWKHFXW VSOLWOLQH EOXHJUHHQ  LQGLFDWHG LQ LQJWRWKHFRPELQHGFXWVSOLWIDFHDORQJWKHFXW VSOLWOLQH EOXHJUHHQ  LQGLFDWHG LQ
)LJXUH>$@)RUWKHFXWVSOLWIDFHWKHVSHFLPHQVZHUHFXWKRUL]RQWDOO\VDZWRWKH )LJXUH>$@)RUWKHFXWVSOLWIDFHWKHVSHFLPHQVZHUHFXWKRUL]RQWDOO\VDZWRWKH
ERWWRPRIWKHUHEDUZKLOHWKHUHPDLQLQJSDUWZDVVSOLWRSHQZLWKDFKLVHO5DLQERZ ERWWRPRIWKHUHEDUZKLOHWKHUHPDLQLQJSDUWZDVVSOLWRSHQZLWKDFKLVHO5DLQERZ
LQGLFDWRU ZDV DSSOLHG WR WKH VDZQVSOLW IDFH RI WKH UHPDLQLQJ VSHFLPHQ WKH ORZHU LQGLFDWRU ZDV DSSOLHG WR WKH VDZQVSOLW IDFH RI WKH UHPDLQLQJ VSHFLPHQ WKH ORZHU
SDUW ZKLOHWKHXSSHUSDUWLHWKHDSSUR[LPDWHO\PPWKLFNVHFWLRQEHWZHHQFXW SDUW ZKLOHWKHXSSHUSDUWLHWKHDSSUR[LPDWHO\PPWKLFNVHFWLRQEHWZHHQFXW
DQGFXWVSOLWZDVXVHGIRUµ('6¶VHHSLQNGRWLQORZS+DUHDDQGWXUTXRLVHGRWLQ DQGFXWVSOLWZDVXVHGIRUµ('6¶VHHSLQNGRWLQORZS+DUHDDQGWXUTXRLVHGRWLQ
KLJKS+DUHDLQ)LJXUH>&@ KLJKS+DUHDLQ)LJXUH>&@
7KHS+UDQJHVRQWKHVSOLWIDFHGHWHUPLQHGE\WKHUDLQERZLQGLFDWRU FIFRORXUFRGH 7KHS+UDQJHVRQWKHVSOLWIDFHGHWHUPLQHGE\WKHUDLQERZLQGLFDWRU FIFRORXUFRGH
LQ7DEOHLQ6HFWLRQ VKRZORZS+YDOXHVLHEHWZHHQDQGLQWKHYLFLQ LQ7DEOHLQ6HFWLRQ VKRZORZS+YDOXHVLHEHWZHHQDQGLQWKHYLFLQ
LW\RIWKHUHEDUDQGDWGHVLJQDWHGUHJLRQVFRQQHFWLQJWKHUHEDUZLWKWKHUXVWVWDLQVRQ LW\RIWKHUHEDUDQGDWGHVLJQDWHGUHJLRQVFRQQHFWLQJWKHUHEDUZLWKWKHUXVWVWDLQVRQ
WKHH[WHUQDOVXUIDFH7KHVHUHJLRQVDUHGLVWLQFWLYHO\VHSDUDWHGIURPUHJLRQVRIKLJKHU WKHH[WHUQDOVXUIDFH7KHVHUHJLRQVDUHGLVWLQFWLYHO\VHSDUDWHGIURPUHJLRQVRIKLJKHU
S+ EHWZHHQDQG VHH)LJXUH>&@5HJLRQVZLWKORZS+VKRZHGUHODWLYHO\ S+ EHWZHHQDQG VHH)LJXUH>&@5HJLRQVZLWKORZS+VKRZHGUHODWLYHO\
KLJK)HFRQFHQWUDWLRQVZKLFKLVH[HPSOLILHGE\WKHHOHPHQWPDSSLQJLQ)LJXUH KLJK)HFRQFHQWUDWLRQVZKLFKLVH[HPSOLILHGE\WKHHOHPHQWPDSSLQJLQ)LJXUH
DQGWKHDVVRFLDWHG µ('6¶VSHFWUXPLQ)LJXUH%RWKZHUHUHFRUGHG DWWKHPHDV DQGWKHDVVRFLDWHG µ('6¶VSHFWUXPLQ)LJXUH%RWKZHUHUHFRUGHG DWWKHPHDV
XUHPHQWSRLQWLGHQWLILHGE\WKHSLQNFLUFOHLQ)LJXUH>&@ XUHPHQWSRLQWLGHQWLILHGE\WKHSLQNFLUFOHLQ)LJXUH>&@

 
)LJXUH (QHUJ\ GLVSHUVLYH HOHPHQW PDSSLQJ RI PHDVXUHPHQW SRLQW LQ ORZ S+ )LJXUH (QHUJ\ GLVSHUVLYH HOHPHQW PDSSLQJ RI PHDVXUHPHQW SRLQW LQ ORZ S+
DUHD )LJXUH  >&@ SLQN GRW  >$@ &DOFLXP >%@ &KORULGH >&@ DUHD )LJXUH  >&@ SLQN GRW  >$@ &DOFLXP >%@ &KORULGH >&@
,URQ>'@6RGLXP>(@2[\JHQ>)@6LOLFRQ ,URQ>'@6RGLXP>(@2[\JHQ>)@6LOLFRQ
 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV

 
)LJXUH (QHUJ\ GLVSHUVLYH VSHFWUXP RI PHDVXUHPHQW SRLQW LQ ORZ S+ DUHD )LJXUH (QHUJ\ GLVSHUVLYH VSHFWUXP RI PHDVXUHPHQW SRLQW LQ ORZ S+ DUHD
)LJXUH>&@SLQNGRW ;UD\HQHUJLHVRQWKH;D[LVDQGUHODWLYH )LJXUH>&@SLQNGRW ;UD\HQHUJLHVRQWKH;D[LVDQGUHODWLYH
;UD\FRXQWVRQWKH<D[LV ;UD\FRXQWVRQWKH<D[LV
,QFRQWUDVWWRWKHUHODWLYHO\KLJKDPRXQWRILURQLQWKHORZS+UHJLRQQRRUYHU\OLWWOH ,QFRQWUDVWWRWKHUHODWLYHO\KLJKDPRXQWRILURQLQWKHORZS+UHJLRQQRRUYHU\OLWWOH
GHWHFWDEOHLURQ ZDVIRXQGLQWKHKLJKS+UHJLRQV7KLVLVH[HPSOLILHGE\ WKH µ('6¶ GHWHFWDEOHLURQ ZDVIRXQGLQWKHKLJKS+UHJLRQV7KLVLVH[HPSOLILHGE\ WKH µ('6¶
VSHFWUXPVKRZQLQ)LJXUHZKLFKZDVUHFRUGHGDWWKHPHDVXUHPHQWSRLQWLGHQWL VSHFWUXPVKRZQLQ)LJXUHZKLFKZDVUHFRUGHGDWWKHPHDVXUHPHQWSRLQWLGHQWL
ILHGE\WKHWXUTXRLVHFLUFOHLQ)LJXUH>&@ ILHGE\WKHWXUTXRLVHFLUFOHLQ)LJXUH>&@

 
)LJXUH (QHUJ\ GLVSHUVLYH VSHFWUXP RI PHDVXUHPHQW SRLQW LQ KLJK S+ DUHD )LJXUH (QHUJ\ GLVSHUVLYH VSHFWUXP RI PHDVXUHPHQW SRLQW LQ KLJK S+ DUHD
)LJXUH  >&@ WXUTXRLVH GRW  ;UD\ HQHUJLHV RQ WKH ;D[LV DQG )LJXUH  >&@ WXUTXRLVH GRW  ;UD\ HQHUJLHV RQ WKH ;D[LV DQG
UHODWLYH;UD\FRXQWVRQWKH<D[LV UHODWLYH;UD\FRXQWVRQWKH<D[LV
:HWKLQNWKDWWKHGLVWLQFWRFFXUUHQFHDQGS+UDQJHVRIWKHUHJLRQVLGHQWLILHGZLWKWKH :HWKLQNWKDWWKHGLVWLQFWRFFXUUHQFHDQGS+UDQJHVRIWKHUHJLRQVLGHQWLILHGZLWKWKH
UDLQERZ LQGLFDWRU FI )LJXUH  >&@  LQ FRPELQDWLRQ ZLWK WKH UHODWLYHO\ KLJK )H UDLQERZ LQGLFDWRU FI )LJXUH  >&@  LQ FRPELQDWLRQ ZLWK WKH UHODWLYHO\ KLJK )H
FRQFHQWUDWLRQV FI)LJXUHDQG)LJXUH LQWKHORZS+UHJLRQV FRPSDUHGWR FRQFHQWUDWLRQV FI)LJXUHDQG)LJXUH LQWKHORZS+UHJLRQV FRPSDUHGWR
QRRUYHU\ORZGHWHFWDEOHLURQFRQFHQWUDWLRQLQWKHUHJLRQVKLJKHUS+UHJLRQVFI)LJ QRRUYHU\ORZGHWHFWDEOHLURQFRQFHQWUDWLRQLQWKHUHJLRQVKLJKHUS+UHJLRQVFI)LJ
XUH   LV D UHDVRQDEOH FRQILUPDWLRQ IRU WKH SURSRVHG UHDFWLRQ PHFKDQLVP 7KLV XUH   LV D UHDVRQDEOH FRQILUPDWLRQ IRU WKH SURSRVHG UHDFWLRQ PHFKDQLVP 7KLV
KROGVLQSDUWLFXODUZLWKUHJDUGWRWKHIRUPDWLRQRIDFLGLILHGSDWKZD\V FI)LJXUH KROGVLQSDUWLFXODUZLWKUHJDUGWRWKHIRUPDWLRQRIDFLGLILHGSDWKZD\V FI)LJXUH
>%@)LJXUHDQG)LJXUH>$@  >%@)LJXUHDQG)LJXUH>$@ 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

7KHSK\VLFDOUHVXOWIURPFKORULGHLQGXFHGFRUURVLRQDQGWKHGHVFULEHGPHFKDQLVPLQ 7KHSK\VLFDOUHVXOWIURPFKORULGHLQGXFHGFRUURVLRQDQGWKHGHVFULEHGPHFKDQLVPLQ
WKHR[\JHQGHSULYHGHQYLURQPHQWGLIIHUVWRTXLWHVRPHH[WHQWIURPWKHGDPDJHW\SHV WKHR[\JHQGHSULYHGHQYLURQPHQWGLIIHUVWRTXLWHVRPHH[WHQWIURPWKHGDPDJHW\SHV
UHVXOWLQJIURPWKHIRUPDWLRQRIH[SDQVLYHFRUURVLRQSURGXFWVLQR[\JHQULFKFRQFUHWH UHVXOWLQJIURPWKHIRUPDWLRQRIH[SDQVLYHFRUURVLRQSURGXFWVLQR[\JHQULFKFRQFUHWH
FI6HFWLRQ &KORULGHLQGXFHGSLWWLQJDQGVXEVHTXHQWGLVVROXWLRQRIWKHUHEDU FI6HFWLRQ &KORULGHLQGXFHGSLWWLQJDQGVXEVHTXHQWGLVVROXWLRQRIWKHUHEDU
UHVXOWVLQDQRWFKOLNHVKDSHDWWDFNRIWKHUHLQIRUFLQJVWHHOVHH)LJXUH>$@ UHVXOWVLQDQRWFKOLNHVKDSHDWWDFNRIWKHUHLQIRUFLQJVWHHOVHH)LJXUH>$@

 
)LJXUH >$@ 1RWFKOLNH VKDSH FRUURVLRQ DWWDFN RI UHEDU LQ FKORULGH FRQWDPL )LJXUH >$@ 1RWFKOLNH VKDSH FRUURVLRQ DWWDFN RI UHEDU LQ FKORULGH FRQWDPL
QDWHGFRQFUHWH)URP>&2:,E@>%@&ROODSVHRISDUNLQJJDUDJH QDWHGFRQFUHWH)URP>&2:,E@>%@&ROODSVHRISDUNLQJJDUDJH
LQ0LQQHVRWD86$GXHWRFKORULGHLQGXFHGFRUURVLRQGDPDJH)URP LQ0LQQHVRWD86$GXHWRFKORULGHLQGXFHGFRUURVLRQGDPDJH)URP
>%RUJDUGHWDO@ >%RUJDUGHWDO@
7KHWHQVLRQDOVWUHVVVWUDLQUHODWLRQRIWKHVWHHOFKDQJHVLQWKHFRUURGLQJDUHDDQGLQLWV 7KHWHQVLRQDOVWUHVVVWUDLQUHODWLRQRIWKHVWHHOFKDQJHVLQWKHFRUURGLQJDUHDDQGLQLWV
YLFLQLW\ZKHQWKHQRWFKJURZVWRDVXIILFLHQWVL]H7KHRUHWLFDOO\LIRQO\DERXWRI YLFLQLW\ZKHQWKHQRWFKJURZVWRDVXIILFLHQWVL]H7KHRUHWLFDOO\LIRQO\DERXWRI
WKH FURVVVHFWLRQDO DUHD DUH FRUURGHG D UHEDU FDQ QR ORQJHU EH UHJDUGHG DV D OLQHDU WKH FURVVVHFWLRQDO DUHD DUH FRUURGHG D UHEDU FDQ QR ORQJHU EH UHJDUGHG DV D OLQHDU
HODVWLFRULGHDOSODVWLFPDWHULDO>)UHGHULNVHQ 3RXOVHQ@7KHQRWFKZLOOWDNHXS HODVWLFRULGHDOSODVWLFPDWHULDO>)UHGHULNVHQ 3RXOVHQ@7KHQRWFKZLOOWDNHXS
DOO WKH GHIRUPDWLRQ DV WHQVLOH VWUHVVDQGWKH \LHOGFDSDFLW\RIWKHUHLQIRUFLQJVWHHOLV DOO WKH GHIRUPDWLRQ DV WHQVLOH VWUHVV DQG WKH \LHOG FDSDFLW\ RI WKH UHLQIRUFLQJVWHHOLV
UHGXFHGWR\LHOGLQJLQWKHQRWFK8QGHUWKHVHFLUFXPVWDQFHVWKHFRUURGLQJUHLQIRUFLQJ UHGXFHGWR\LHOGLQJLQWKHQRWFK8QGHUWKHVHFLUFXPVWDQFHVWKHFRUURGLQJUHLQIRUFLQJ
VWHHO DFWV DV D EULWWOH PDWHULDO GXH WR WKH FRQFHQWUDWLRQ RI WKH WHQVLOH VWUHVV LQ WKH VWHHO DFWV DV D EULWWOH PDWHULDO GXH WR WKH FRQFHQWUDWLRQ RI WKH WHQVLOH VWUHVV LQ WKH
QRWFK7KHFRQVHTXHQFHRIEULWWOHEHKDYLRXURIUHLQIRUFHPHQWXQGHUVLPXOWDQHRXVH[ QRWFK7KHFRQVHTXHQFHRIEULWWOHEHKDYLRXURIUHLQIRUFHPHQWXQGHUVLPXOWDQHRXVH[
SRVXUHWRKHDY\ORDGFDQEHGLVDVWURXVZKLFKLVLOOXVWUDWHGE\WKHZLGHO\SXEOLFLVHG SRVXUHWRKHDY\ORDGFDQEHGLVDVWURXVZKLFKLVLOOXVWUDWHGE\WKHZLGHO\SXEOLFLVHG
SKRWRJUDSKRIWKHFROODSVHRIDSDUNLQJJDUDJHGXHWRFKORULGHLQGXFHGUHLQIRUFHPHQW SKRWRJUDSKRIWKHFROODSVHRIDSDUNLQJJDUDJHGXHWRFKORULGHLQGXFHGUHLQIRUFHPHQW
FRUURVLRQVHH)LJXUH>%@ FRUURVLRQVHH)LJXUH>%@
'HSHQGLQJRQWKHDYDLODELOLW\RIR[\JHQFKORULGHLQGXFHGFRUURVLRQRUWKHFRPELQD 'HSHQGLQJRQWKHDYDLODELOLW\RIR[\JHQFKORULGHLQGXFHGFRUURVLRQRUWKHFRPELQD
WLRQ RI FKORULGH FRQWDPLQDWLRQ DQG FDUERQDWLRQ FDQ OHDG WR VLPLODU GDPDJH W\SHV DV WLRQ RI FKORULGH FRQWDPLQDWLRQ DQG FDUERQDWLRQ FDQ OHDG WR VLPLODU GDPDJH W\SHV DV
GHVFULEHG IRU FDUERQDWLRQ LQGXFHG FRUURVLRQ FI )LJXUH   +RZHYHU LQ SDUWLFXODU GHVFULEHG IRU FDUERQDWLRQ LQGXFHG FRUURVLRQ FI )LJXUH   +RZHYHU LQ SDUWLFXODU
ZLWK UHJDUG WR WKH GLIIXVLRQ RI VROXEOH FRUURVLRQ SURGXFWV GHVFULEHG WKURXJKRXW WKLV ZLWK UHJDUG WR WKH GLIIXVLRQ RI VROXEOH FRUURVLRQ SURGXFWV GHVFULEHG WKURXJKRXW WKLV
6HFWLRQ LW LV LPSRUWDQW WR QRWH WKDW GDPDJH XQGHU FKORULGH LQGXFHG FRUURVLRQ LQ WKH 6HFWLRQ LW LV LPSRUWDQW WR QRWH WKDW GDPDJH XQGHU FKORULGH LQGXFHG FRUURVLRQ LQ WKH
R[\JHQGHSULYHGHQYLURQPHQWLVQRWUHSUHVHQWHGE\GHWHULRUDWLRQRUFRUURVLRQSURSD R[\JHQGHSULYHGHQYLURQPHQWLVQRWUHSUHVHQWHGE\GHWHULRUDWLRQRUFRUURVLRQSURSD
JDWLRQ PRGHOV WKDW DUH EDVHG RQ IRUPDWLRQ RI VROLG YROXPLQRXV SURGXFWVDW WKH FRQ JDWLRQ PRGHOV WKDW DUH EDVHG RQ IRUPDWLRQ RI VROLG YROXPLQRXV SURGXFWVDW WKH FRQ
FUHWHVWHHOLQWHUIDFH FI6HFWLRQ  FUHWHVWHHOLQWHUIDFH FI6HFWLRQ 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV

 ,PPXQH6WDWH  ,PPXQH6WDWH


7KHLPPXQHVWDWHLVQRWDFRUURVLRQVWDWHSHUVHEXWDVKRUWQRWHRQLWVKRXOGEHJLYHQ 7KHLPPXQHVWDWHLVQRWDFRUURVLRQVWDWHSHUVHEXWDVKRUWQRWHRQLWVKRXOGEHJLYHQ
DVWKLVWKHUPRG\QDPLFVWDWHLVRIPDMRULPSRUWDQFHLQDYDLODEOHFRXQWHUPHDVXUHVHJ DVWKLVWKHUPRG\QDPLFVWDWHLVRIPDMRULPSRUWDQFHLQDYDLODEOHFRXQWHUPHDVXUHVHJ
FRQFHUQLQJµ&3¶ FI6HFWLRQ DVZHOODVLQWKHSURSRVHGQHZFRXQWHUPHDVXUHV FRQFHUQLQJµ&3¶ FI6HFWLRQ DVZHOODVLQWKHSURSRVHGQHZFRXQWHUPHDVXUHV
FI &KDSWHU   ,Q )LJXUH  WKH )H+2 µ6(3'¶ ZLWK )HLD  í PRO/ )LJXUH FI &KDSWHU   ,Q )LJXUH  WKH )H+2 µ6(3'¶ ZLWK )HLD  í PRO/ )LJXUH
 >$@ LV FRPSDUHG WR WKH )H+2µ6(3'¶ZLWK)HLD PRO/ )LJXUH>%@   >$@ LV FRPSDUHG WR WKH )H+2µ6(3'¶ZLWK)HLD PRO/ )LJXUH>%@ 
DQGWRWKH)H&O+2µ0(3'¶ZLWK)HLD íPRO/DQG&OLD PRO/ )LJXUH DQGWRWKH)H&O+2µ0(3'¶ZLWK)HLD íPRO/DQG&OLD PRO/ )LJXUH
>%@  >%@ 

 
)LJXUH >$@)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/>%@ )LJXUH >$@)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/>%@
$V >$@EXW )HLD   PRO/>&@ )H&O+2 µ0(3'¶ EDVHG RQ 7DEOH $V >$@EXW )HLD   PRO/ >&@ )H&O+2 µ0(3'¶ EDVHG RQ 7DEOH
DQG)HLD íPRO/DQG&OLD PRO/ DQG)HLD íPRO/DQG&OLD PRO/
&RPSDULQJWKHLPPXQLW\ UHJLRQVRIWKHµ6(3'V¶ZLWKGLIIHUHQWLURQLRQDFWLYLWLHVLQ &RPSDULQJWKHLPPXQLW\ UHJLRQVRIWKHµ6(3'V¶ZLWKGLIIHUHQWLURQLRQDFWLYLWLHVLQ
)LJXUH>$@DQG>%@LWFDQEHFRQFOXGHGWKDWDQLQFUHDVHGLURQFRQFHQWUDWLRQKDV )LJXUH>$@DQG>%@LWFDQEHFRQFOXGHGWKDWDQLQFUHDVHGLURQFRQFHQWUDWLRQKDV
DQLQIOXHQFHRQWKHHTXLOLEULDRI)HZLWKWKHDGMDFHQWVSHFLHVEXWWKHHIIHFWLQLQFUHDV DQLQIOXHQFHRQWKHHTXLOLEULDRI)HZLWKWKHDGMDFHQWVSHFLHVEXWWKHHIIHFWLQLQFUHDV
LQJWKHFRQFHQWUDWLRQLVUDWKHUVPDOOHJFRPSDUHGWRWKHHIIHFWLQLQFUHDVLQJWKHSDV LQJWKHFRQFHQWUDWLRQLVUDWKHUVPDOOHJFRPSDUHGWRWKHHIIHFWLQLQFUHDVLQJWKHSDV
VLYLW\GRPDLQ)URPWKHFRPSDULVRQEHWZHHQWKH)H+2µ6(3'¶LQ)LJXUH>$@ VLYLW\GRPDLQ)URPWKHFRPSDULVRQEHWZHHQWKH)H+2µ6(3'¶LQ)LJXUH>$@
DQGWKH)H&O+2µ0(3'¶LQ)LJXUH>%@EDVHGRQWKHVDPH)HLDLWFDQEHVHHQ DQGWKH)H&O+2µ0(3'¶LQ)LJXUH>%@EDVHGRQWKHVDPH)HLDLWFDQEHVHHQ
WKDWWKHDGGLWLRQRIFKORULGHGRHVQRWDIIHFWWKHHTXLOLEULDRI)HZLWKWKHDGMDFHQWVSH WKDWWKHDGGLWLRQRIFKORULGHGRHVQRWDIIHFWWKHHTXLOLEULDRI)HZLWKWKHDGMDFHQWVSH
FLHVLHWKHHOHFWURGHSRWHQWLDOWRREWDLQLPPXQLW\VWD\WKHVDPH FLHVLHWKHHOHFWURGHSRWHQWLDOWRREWDLQLPPXQLW\VWD\WKHVDPH
:KLOH WKH H[WHQWV RI WKH SDVVLYLW\ GRPDLQV DW D FHUWDLQ LRQ DFWLYLW\ DUH DSSUR[LPDWH :KLOH WKH H[WHQWV RI WKH SDVVLYLW\ GRPDLQV DW D FHUWDLQ LRQ DFWLYLW\ DUH DSSUR[LPDWH
SDUDPHWHUVWKHHTXLOLEULDEHWZHHQ)HDQGR[LGLVHGVSHFLHVRUFRPSRXQGVZLWKRWKHU SDUDPHWHUVWKHHTXLOLEULDEHWZHHQ)HDQGR[LGLVHGVSHFLHVRUFRPSRXQGVZLWKRWKHU
HOHPHQWV DUH WKHUPRG\QDPLFDOO\ H[DFW SDUDPHWHUV DV WKH\ UHIOHFW WKH LQKHUHQW HOHF HOHPHQWV DUH WKHUPRG\QDPLFDOO\ H[DFW SDUDPHWHUV DV WKH\ UHIOHFW WKH LQKHUHQW HOHF
WURFKHPLFDOSURSHUWLHVRILURQLQDTXHRXVVROXWLRQV:HFRQVLGHUWKLVWREHDQLPSRU WURFKHPLFDOSURSHUWLHVRILURQLQDTXHRXVVROXWLRQV:HFRQVLGHUWKLVWREHDQLPSRU
WDQWDVSHFWZKHQFDWKRGLFSRODULVDWLRQIRUFRUURVLRQSURWHFWLRQLVDLPHGDW0RUHRYHU WDQWDVSHFWZKHQFDWKRGLFSRODULVDWLRQIRUFRUURVLRQSURWHFWLRQLVDLPHGDW0RUHRYHU
ZHWKLQNWKDWLWLVLPSRUWDQWWRSRLQWRXWDWKHUPRG\QDPLFDVSHFWRILURQZKLFKZDV ZHWKLQNWKDWLWLVLPSRUWDQWWRSRLQWRXWDWKHUPRG\QDPLFDVSHFWRILURQZKLFKZDV
DSSOLHGEXWQRWH[FOXVLYHO\PHQWLRQHGWKURXJKRXW6HFWLRQDQG,Q)LJXUHLW DSSOLHGEXWQRWH[FOXVLYHO\PHQWLRQHGWKURXJKRXW6HFWLRQDQG,Q)LJXUHLW
FDQEHREVHUYHGWKDW)HGRHVQRWKDYHDVWDELOLW\GRPDLQLQFRPPRQZLWKWKHVWDELOLW\ FDQEHREVHUYHGWKDW)HGRHVQRWKDYHDVWDELOLW\GRPDLQLQFRPPRQZLWKWKHVWDELOLW\
GRPDLQRIZDWHUDQGKHQFHDOZD\V³FRUURGHV´LQWKHDFWLYHRUSDVVLYHVWDWHLQDTXH GRPDLQRIZDWHUDQGKHQFHDOZD\V³FRUURGHV´LQWKHDFWLYHRUSDVVLYHVWDWHLQDTXH
RXV VROXWLRQV 7KLV WKHUPRG\QDPLF SURSHUW\ DSSOLHV WR VHYHUDO PHWDOV ZKHUHDV WKH RXV VROXWLRQV 7KLV WKHUPRG\QDPLF SURSHUW\ DSSOLHV WR VHYHUDO PHWDOV ZKHUHDV WKH
LPPXQLW\GRPDLQRIVRPHQREOHPHWDOVH[WHQWVSDUWO\ HJFRSSHUVLOYHUSODWLQXP  LPPXQLW\GRPDLQRIVRPHQREOHPHWDOVH[WHQWVSDUWO\ HJFRSSHUVLOYHUSODWLQXP 
RUHQWLUHO\ LQSULQFLSOHOLPLWHGWRJROG LQWRWKHVWDELOLW\GRPDLQRIZDWHULQWKHS+ RUHQWLUHO\ LQSULQFLSOHOLPLWHGWRJROG LQWRWKHVWDELOLW\GRPDLQRIZDWHULQWKHS+

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ 5HDFWLRQ0HFKDQLVPV 7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ

UDQJH IURP  5HODWHG WR WKLV SURSHUW\ D ILQDO DVSHFW WKDW VKRXOG EH HPSKDVLVHG UDQJH IURP  5HODWHG WR WKLV SURSHUW\ D ILQDO DVSHFW WKDW VKRXOG EH HPSKDVLVHG
ZLWKUHJDUGWRLPPXQLW\RILURQLVWKDWLWFDQFRQVHTXHQWO\RQO\EHREWDLQHGE\VXU ZLWKUHJDUGWRLPPXQLW\RILURQLVWKDWLWFDQFRQVHTXHQWO\RQO\EHREWDLQHGE\VXU
SDVVLQJWKHWKHRUHWLFDOK\GURJHQOLQH FI6HFWLRQ 7KXVK\GURJHQHPEULWWOH SDVVLQJWKHWKHRUHWLFDOK\GURJHQOLQH FI6HFWLRQ 7KXVK\GURJHQHPEULWWOH
PHQW FI6HFWLRQ EHFRPHVDQDVSHFWRIFRQFHUQZKHQGHVLJQLQJIRULPPXQLW\ PHQW FI6HFWLRQ EHFRPHVDQDVSHFWRIFRQFHUQZKHQGHVLJQLQJIRULPPXQLW\
ZKLFKLVGLVFXVVHGLQUHODWLRQWRDYDLODEOHFRXQWHUPHDVXUHVLQ&KDSWHUDQGZLWKUH ZKLFKLVGLVFXVVHGLQUHODWLRQWRDYDLODEOHFRXQWHUPHDVXUHVLQ&KDSWHUDQGZLWKUH
JDUGWRWKHSURSRVHGQHZFRXQWHUPHDVXUHVWKURXJKRXW&KDSWHU JDUGWRWKHSURSRVHGQHZFRXQWHUPHDVXUHVWKURXJKRXW&KDSWHU
 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


 

 $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV  $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV
7KHH[HPSOLILFDWLRQVLQ&KDSWHULOOXVWUDWHGWKHEHQHILFLDOXVHRIWKHUPRG\QDPLFV LQ 7KHH[HPSOLILFDWLRQVLQ&KDSWHULOOXVWUDWHGWKHEHQHILFLDOXVHRIWKHUPRG\QDPLFV LQ
SDUWLFXODUWKHXVHRIWKH3RXUEDL[GLDJUDPLQFRPELQDWLRQZLWKUHDFWLRQPHFKDQLVPV  SDUWLFXODUWKHXVHRIWKH3RXUEDL[GLDJUDPLQFRPELQDWLRQZLWKUHDFWLRQPHFKDQLVPV 
IRUWKHGHVFULSWLRQRIUHLQIRUFHPHQWFRUURVLRQ:HWKLQNWKDWWKHUPRG\QDPLFDOO\FRQ IRUWKHGHVFULSWLRQRIUHLQIRUFHPHQWFRUURVLRQ:HWKLQNWKDWWKHUPRG\QDPLFDOO\FRQ
VLVWHQWPHFKDQLVPVDUHQRWOLPLWHGWRWKHGHVFULSWLRQRIFRUURVLRQSURFHVVHVEXWFDQ VLVWHQWPHFKDQLVPVDUHQRWOLPLWHGWRWKHGHVFULSWLRQRIFRUURVLRQSURFHVVHVEXWFDQ
DOVRHVWDEOLVKWKHEDVLVIRUWKHHYDOXDWLRQRIDYDLODEOHFRXQWHUPHDVXUHV WKLV&KDSWHU  DOVRHVWDEOLVKWKHEDVLVIRUWKHHYDOXDWLRQRIDYDLODEOHFRXQWHUPHDVXUHV WKLV&KDSWHU 
DV ZHOO DV IRU WKH GHVLJQ RI QHZ FRXQWHUPHDVXUHV &KDSWHU   *LYHQWKDWWKHHVWDE DV ZHOO DV IRU WKH GHVLJQ RI QHZ FRXQWHUPHDVXUHV &KDSWHU   *LYHQWKDWWKHHVWDE
OLVKHG3RXUEDL[GLDJUDPVDQGWKHDVVRFLDWHGUHDFWLRQPHFKDQLVPVUHIOHFWWKHLQYHVWL OLVKHG3RXUEDL[GLDJUDPVDQGWKHDVVRFLDWHGUHDFWLRQPHFKDQLVPVUHIOHFWWKHLQYHVWL
JDWHGV\VWHP FI6HFWLRQ DWKHUPRG\QDPLFHYDOXDWLRQEDVHGRQWKLVLQIRUPD JDWHGV\VWHP FI6HFWLRQ DWKHUPRG\QDPLFHYDOXDWLRQEDVHGRQWKLVLQIRUPD
WLRQFDQEHXVHGWRHJLGHQWLI\SUREOHPVSRVVLEOHLPSURYHPHQWVDVZHOODVIRUFRQ WLRQFDQEHXVHGWRHJLGHQWLI\SUREOHPVSRVVLEOHLPSURYHPHQWVDVZHOODVIRUFRQ
FOXVLRQVFRQFHUQLQJWKHHIIHFWLYHQHVVRIWKHLQYHVWLJDWHGFRXQWHUPHDVXUH7KDWKROGV FOXVLRQVFRQFHUQLQJWKHHIIHFWLYHQHVVRIWKHLQYHVWLJDWHGFRXQWHUPHDVXUH7KDWKROGV
LQSDUWLFXODUIRUHJVWDLQOHVVVWHHOJDOYDQLVHGVWHHORUµ&3¶ZKLFKFDQEHFRQVLGHUHG LQSDUWLFXODUIRUHJVWDLQOHVVVWHHOJDOYDQLVHGVWHHORUµ&3¶ZKLFKFDQEHFRQVLGHUHG
DVWKHUPRG\QDPLFDOO\EDVHGFRXQWHUPHDVXUHV DVWKHUPRG\QDPLFDOO\EDVHGFRXQWHUPHDVXUHV
+RZHYHUDGHWDLOHGWKHUPRG\QDPLFHYDOXDWLRQRIDOODYDLODEOHFRXQWHUPHDVXUHVJRHV +RZHYHUDGHWDLOHGWKHUPRG\QDPLFHYDOXDWLRQRIDOODYDLODEOHFRXQWHUPHDVXUHVJRHV
EH\RQGWKHVFRSHRIWKLVWKHVLV+HQFHWKHFRYHUDJHRIWKHUPRG\QDPLFSULQFLSOHVLQ EH\RQGWKHVFRSHRIWKLVWKHVLV+HQFHWKHFRYHUDJHRIWKHUPRG\QDPLFSULQFLSOHVLQ
WKLV&KDSWHULVOLPLWHGWRSRLQWLQJRXWSRVVLEOHDSSOLFDWLRQVZKLOHWKHSDUWLFXODUFKDU WKLV&KDSWHULVOLPLWHGWRSRLQWLQJRXWSRVVLEOHDSSOLFDWLRQVZKLOHWKHSDUWLFXODUFKDU
DFWHULVWLFVDUHEULHIO\GHVFULEHGEDVHGRQDFULWLFDOUHYLHZRIWKHOLWHUDWXUH7KHUHYLHZ DFWHULVWLFVDUHEULHIO\GHVFULEHGEDVHGRQDFULWLFDOUHYLHZRIWKHOLWHUDWXUH7KHUHYLHZ
LVLQWHQWLRQDOO\NHSWVKRUWDQGSURYLGHVRQO\DEULHIVXPPDU\KLJKOLJKWLQJVRPHFHQ LVLQWHQWLRQDOO\NHSWVKRUWDQGSURYLGHVRQO\DEULHIVXPPDU\KLJKOLJKWLQJVRPHFHQ
WUDODVSHFWVWKDWDUHFRQVLGHUHGWREHLPSRUWDQWIRUWKHSXUSRVHVRIWKLVWKHVLV7KXVLW WUDODVSHFWVWKDWDUHFRQVLGHUHGWREHLPSRUWDQWIRUWKHSXUSRVHVRIWKLVWKHVLV7KXVLW
LV RIWHQ UHIHUUHG WR D ODUJHU ERG\ RI H[WHQVLYH OLWHUDWXUH GHDOLQJ ZLWK WKH GLVFXVVHG LV RIWHQ UHIHUUHG WR D ODUJHU ERG\ RI H[WHQVLYH OLWHUDWXUH GHDOLQJ ZLWK WKH GLVFXVVHG
FRXQWHUPHDVXUHV FI6HFWLRQ &HUWDLQFRXQWHUPHDVXUHVDUHWUHDWHGLQPRUHGHWDLO FRXQWHUPHDVXUHV FI6HFWLRQ &HUWDLQFRXQWHUPHDVXUHVDUHWUHDWHGLQPRUHGHWDLO
EHFDXVH DVSHFWVRIWKHVHPHDVXUHVDUHVLJQLILFDQWIRUWKHGHYHORSPHQWDQGHVWDEOLVK EHFDXVH DVSHFWVRIWKHVHPHDVXUHVDUHVLJQLILFDQWIRUWKHGHYHORSPHQWDQGHVWDEOLVK
PHQWRIWKHSURSRVHGQHZFRXQWHUPHDVXUHV &KDSWHU &ULWLFDOVKRUWFRPLQJVRIWKH PHQWRIWKHSURSRVHGQHZFRXQWHUPHDVXUHV &KDSWHU &ULWLFDOVKRUWFRPLQJVRIWKH
DYDLODEOHFRXQWHUPHDVXUHVDUHDFHQWUDOLQSXWLQWKHGHVLJQDVSHFWVDQGUHTXLUHPHQWV DYDLODEOHFRXQWHUPHDVXUHVDUHDFHQWUDOLQSXWLQWKHGHVLJQDVSHFWVDQGUHTXLUHPHQWV
IRU RXU SURSRVHG QHZ FRXQWHUPHDVXUHV ZKLFK LV GHDOW ZLWK LQ 6HFWLRQ  6R LQ IRU RXU SURSRVHG QHZ FRXQWHUPHDVXUHV ZKLFK LV GHDOW ZLWK LQ 6HFWLRQ  6R LQ
FRPELQDWLRQZLWK&KDSWHUVDQGWKLV&KDSWHUSURYLGHVWKHEDFNJURXQGRIWKH FRPELQDWLRQZLWK&KDSWHUVDQGWKLV&KDSWHUSURYLGHVWKHEDFNJURXQGRIWKH
FRQVLGHUDWLRQVIRUWKHGHYHORSPHQWRIQHZFRXQWHUPHDVXUHV FRQVLGHUDWLRQVIRUWKHGHYHORSPHQWRIQHZFRXQWHUPHDVXUHV
$IWHUDVKRUWLQWURGXFWLRQWRWKHPRVWLPSRUWDQWJHQHUDODVSHFWVRIGXUDELOLW\DQGVHU $IWHUDVKRUWLQWURGXFWLRQWRWKHPRVWLPSRUWDQWJHQHUDODVSHFWVRIGXUDELOLW\DQGVHU
YLFHOLQHGHVLJQLQ6HFWLRQDQGWRWKHUHOHYDQWVWDQGDUGVDQGJXLGHOLQHVDVZHOODV YLFHOLQHGHVLJQLQ6HFWLRQDQGWRWKHUHOHYDQWVWDQGDUGVDQGJXLGHOLQHVDVZHOODV
WRVHOHFWHGUHODWHGRUJDQLVDWLRQVLQ6HFWLRQFRXQWHUPHDVXUHVIRUQHZDQGH[LVWLQJ WRVHOHFWHGUHODWHGRUJDQLVDWLRQVLQ6HFWLRQFRXQWHUPHDVXUHVIRUQHZDQGH[LVWLQJ
VWUXFWXUHVDUHUHYLHZHGLQ6HFWLRQVDQGUHVSHFWLYHO\ VWUXFWXUHVDUHUHYLHZHGLQ6HFWLRQVDQGUHVSHFWLYHO\

 'XUDELOLW\DQG6HUYLFH/LIH'HVLJQ  'XUDELOLW\DQG6HUYLFH/LIH'HVLJQ


,QSUDFWLFHGXUDELOLW\LVDVXEMHFWLYHSDUDPHWHUDQGGLIILFXOWWRGHILQHSUHFLVHO\>ILE ,QSUDFWLFHGXUDELOLW\LVDVXEMHFWLYHSDUDPHWHUDQGGLIILFXOWWRGHILQHSUHFLVHO\>ILE
D@7KHUHIRUHWKHVHUYLFHOLIHFRQFHSWKDVODUJHO\UHSODFHG WKH QRQIDFWXDO FRQ D@7KHUHIRUHWKHVHUYLFHOLIHFRQFHSWKDVODUJHO\UHSODFHG WKH QRQIDFWXDO FRQ
FHSW RI GXUDELOLW\ VLQFH WKH VHUYLFH OLIH LV TXDQWLILDEOH DQG PHDVXUDEOH TXDQWLW\ FHSW RI GXUDELOLW\ VLQFH WKH VHUYLFH OLIH LV TXDQWLILDEOH DQG PHDVXUDEOH TXDQWLW\
>)DJHUOXQG@ZKLFKLVJHQHUDOO\H[SUHVVHGLQ\HDUV6RWKHWLPHIDFWRULVLQWUR >)DJHUOXQG@ZKLFKLVJHQHUDOO\H[SUHVVHGLQ\HDUV6RWKHWLPHIDFWRULVLQWUR
GXFHG DV D GHVLJQ SDUDPHWHU 7KHUH DUH GLIIHUHQW VHUYLFH OLIH FRQFHSWV EXW WKH PRVW GXFHG DV D GHVLJQ SDUDPHWHU 7KHUH DUH GLIIHUHQW VHUYLFH OLIH FRQFHSWV EXW WKH PRVW
LPSRUWDQWRQHIRUWKHSXUSRVHVRIWKLVWKHVLVLVWKHWHFKQLFDOVHUYLFHOLIHZKLFKFDQEH LPSRUWDQWRQHIRUWKHSXUSRVHVRIWKLVWKHVLVLVWKHWHFKQLFDOVHUYLFHOLIHZKLFKFDQEH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV 'XUDELOLW\DQG6HUYLFH/LIH'HVLJQ $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV 'XUDELOLW\DQG6HUYLFH/LIH'HVLJQ

GHILQHGDV>ILED@³7KHWLPHLQVHUYLFHXQWLODGHILQHGXQDFFHSWDEOHVWDWHRIGH GHILQHGDV>ILED@³7KHWLPHLQVHUYLFHXQWLODGHILQHGXQDFFHSWDEOHVWDWHRIGH
WHULRUDWLRQLVUHDFKHG´ WHULRUDWLRQLVUHDFKHG´
3URSHUGHVLJQLHDJRRGFRQFUHWHTXDOLW\DVXIILFLHQWO\GHHSFRQFUHWHFRYHUDQGDQ 3URSHUGHVLJQLHDJRRGFRQFUHWHTXDOLW\DVXIILFLHQWO\GHHSFRQFUHWHFRYHUDQGDQ
DGHTXDWH FUDFN ZLGWK OLPLWDWLRQ DV ZHOO DV DSSURSULDWH H[HFXWLRQ DUH QRUPDOO\ VXIIL DGHTXDWH FUDFN ZLGWK OLPLWDWLRQ DV ZHOO DV DSSURSULDWH H[HFXWLRQ DUH QRUPDOO\ VXIIL
FLHQWWRDWWDLQWKHGHVLUHGVHUYLFHOLIHIRUHYHU\GD\EXLOGLQJVDQGQRUPDOVWUXFWXUHVLQ FLHQWWRDWWDLQWKHGHVLUHGVHUYLFHOLIHIRUHYHU\GD\EXLOGLQJVDQGQRUPDOVWUXFWXUHVLQ
PRGHUDWH HQYLURQPHQWV 7KH QDWLRQDO EXLOGLQJ FRGHV DQG UHJXODWLRQV IRU UHLQIRUFHG PRGHUDWH HQYLURQPHQWV 7KH QDWLRQDO EXLOGLQJ FRGHV DQG UHJXODWLRQV IRU UHLQIRUFHG
FRQFUHWHVWUXFWXUHVHJ(XURFRGH>'6(1@DQG>$&,5 FRQFUHWHVWUXFWXUHVHJ(XURFRGH>'6(1@DQG>$&,5
$&,050@HQVXUHWKDWWKHEDVLFVHUYLFHOLIHUHTXLUHPHQWVDUHIXOILOOHG $&,050@HQVXUHWKDWWKHEDVLFVHUYLFHOLIHUHTXLUHPHQWVDUHIXOILOOHG
7KHVHUYLFHOLIHUHTXLUHPHQWV LQWKHRUGHU\HDUV>5RVWDP@ LQWKHVHDQGRWKHU 7KHVHUYLFHOLIHUHTXLUHPHQWV LQWKHRUGHU\HDUV>5RVWDP@ LQWKHVHDQGRWKHU
QDWLRQDOVWDQGDUGVDUHJHQHUDOO\QRWPHQWLRQHGH[SOLFLWO\EXWLPSOLFDWHGE\WKHFRGL QDWLRQDOVWDQGDUGVDUHJHQHUDOO\QRWPHQWLRQHGH[SOLFLWO\EXWLPSOLFDWHGE\WKHFRGL
ILHG GHVLJQ UHTXLUHPHQWV $PRQJ WKH FUDFN ZLGWK OLPLWDWLRQV FI 6HFWLRQ   ILHG GHVLJQ UHTXLUHPHQWV $PRQJ WKH FUDFN ZLGWK OLPLWDWLRQV FI 6HFWLRQ  
WKH PRVW LPSRUWDQW GHVLJQ VSHFLILFDWLRQV IURP D GXUDELOLW\ SRLQW RI YLHZ JHQHUDOO\ WKH PRVW LPSRUWDQW GHVLJQ VSHFLILFDWLRQV IURP D GXUDELOLW\ SRLQW RI YLHZ JHQHUDOO\
FRQFHUQ WKH PD[LPXP µZF¶ WKH PLQLPXP FHPHQW FRQWHQW FI 6HFWLRQ   DQG D FRQFHUQ WKH PD[LPXP µZF¶ WKH PLQLPXP FHPHQW FRQWHQW FI 6HFWLRQ   DQG D
PLQLPXPFRQFUHWHFRYHUGHSWK PLQLPXPFRQFUHWHFRYHUGHSWK
+RZHYHU PDQ\ VSHFLDO VWUXFWXUHV VXFK DV VWUXFWXUHV XQGHU VHYHUH H[SRVXUH FRQGL +RZHYHU PDQ\ VSHFLDO VWUXFWXUHV VXFK DV VWUXFWXUHV XQGHU VHYHUH H[SRVXUH FRQGL
WLRQVVWUXFWXUHVZLWKVSHFLDOVHUYLFHOLIHUHTXLUHPHQWVRUVWUXFWXUHVZLWKDUFKLWHFWXUDO WLRQVVWUXFWXUHVZLWKVSHFLDOVHUYLFHOLIHUHTXLUHPHQWVRUVWUXFWXUHVZLWKDUFKLWHFWXUDO
GHVLJQVWKDWGRQRWDOORZIRU DVXIILFLHQWFRYHU GHSWK UHTXLUHDGGLWLRQDOFRQVLGHUD GHVLJQVWKDWGRQRWDOORZIRU DVXIILFLHQWFRYHU GHSWK UHTXLUHDGGLWLRQDOFRQVLGHUD
WLRQV DQG RIWHQ FRUURVLRQ SUHYHQWLYH PHDVXUHV LH FRXQWHUPHDVXUHV WR RPLW SUHPD WLRQV DQG RIWHQ FRUURVLRQ SUHYHQWLYH PHDVXUHV LH FRXQWHUPHDVXUHV WR RPLW SUHPD
WXUHGHWHULRUDWLRQ&DUSDUNVDQGRIIVKRUHVWUXFWXUHV FI6HFWLRQ DUHSRSXODU WXUHGHWHULRUDWLRQ&DUSDUNVDQGRIIVKRUHVWUXFWXUHV FI6HFWLRQ DUHSRSXODU
H[DPSOHVIRUVHYHUHH[SRVXUHFRQGLWLRQVEXWPRVWEULGJHVWXQQHOVDQGRWKHUVSHFLDO H[DPSOHVIRUVHYHUHH[SRVXUHFRQGLWLRQVEXWPRVWEULGJHVWXQQHOVDQGRWKHUVSHFLDO
LQIUDVWUXFWXUH SURMHFWV DUH QRZDGD\V GHVLJQHG IRU VHUYLFH OLYHV RI   RU HYHQ LQIUDVWUXFWXUH SURMHFWV DUH QRZDGD\V GHVLJQHG IRU VHUYLFH OLYHV RI   RU HYHQ
\HDUVDQGDUHRIWHQDOVRH[SRVHGWRDVHYHUHHQYLURQPHQW \HDUVDQGDUHRIWHQDOVRH[SRVHGWRDVHYHUHHQYLURQPHQW
:LWKWKHWLPHIDFWRULHWKHQXPEHURI\HDUVRIWHFKQLFDOVHUYLFHOLIHLQWURGXFHGDVD :LWKWKHWLPHIDFWRULHWKHQXPEHURI\HDUVRIWHFKQLFDOVHUYLFHOLIHLQWURGXFHGDVD
GHVLJQSDUDPHWHU VHUYLFH OLIH GHVLJQ FDQEH FDUULHG RXW LQ DVLPLODU ZD\ WR WKH ORDG GHVLJQSDUDPHWHU VHUYLFH OLIH GHVLJQ FDQEH FDUULHG RXW LQ DVLPLODU ZD\ WR WKH ORDG
DQGUHVLVWDQFHIDFWRUGHVLJQFRQFHSWXVHGIRUVWUXFWXUDOGHVLJQ>'6(1 DQGUHVLVWDQFHIDFWRUGHVLJQFRQFHSWXVHGIRUVWUXFWXUDOGHVLJQ>'6(1
$&,050@1RZDGD\VSUREDELOLVWLFGHVLJQPRGHOVHJWKH'XUD&UHWH $&,050@1RZDGD\VSUREDELOLVWLFGHVLJQPRGHOVHJWKH'XUD&UHWH
DSSURDFK³3UREDELOLVWLF3HUIRUPDQFHEDVHG'XUDELOLW\'HVLJQRI&RQFUHWH6WUXFWXUHV´ DSSURDFK³3UREDELOLVWLF3HUIRUPDQFHEDVHG'XUDELOLW\'HVLJQRI&RQFUHWH6WUXFWXUHV´
>(QJHOXQG HWDO @ DUH RIWHQ XWLOLVHG LQ VHUYLFH OLIH GHVLJQ RI QHZ VWUXFWXUHV DV >(QJHOXQG HWDO @ DUH RIWHQ XWLOLVHG LQ VHUYLFH OLIH GHVLJQ RI QHZ VWUXFWXUHV DV
ZHOODVIRUWKHUHDVVHVVPHQWRIH[LVWLQJVWUXFWXUHV7KH'XUD&UHWHDSSURDFKWDNHVDOO ZHOODVIRUWKHUHDVVHVVPHQWRIH[LVWLQJVWUXFWXUHV7KH'XUD&UHWHDSSURDFKWDNHVDOO
XQFHUWDLQWLHVUHJDUGLQJHQYLURQPHQWDOH[SRVXUHPDWHULDOSURSHUWLHVDQGGHWHULRUDWLRQ XQFHUWDLQWLHVUHJDUGLQJHQYLURQPHQWDOH[SRVXUHPDWHULDOSURSHUWLHVDQGGHWHULRUDWLRQ
LQWRDFFRXQWLQWKHGHVLJQSKDVH,WKDVEHHQDGRSWHGE\QDWLRQDODXWKRULWLHVDQGLQWHU LQWRDFFRXQWLQWKHGHVLJQSKDVH,WKDVEHHQDGRSWHGE\QDWLRQDODXWKRULWLHVDQGLQWHU
QDWLRQDO DVVRFLDWLRQV HJ LQ WKH ILE ³0RGHO &RGH IRU 6HUYLFH /LIH 'HVLJQ´ >ILE QDWLRQDO DVVRFLDWLRQV HJ LQ WKH ILE ³0RGHO &RGH IRU 6HUYLFH /LIH 'HVLJQ´ >ILE
@ZKLFKLQDGGLWLRQWRWKLVDSSURDFKSURYLGHVWKUHHRWKHUGXUDELOLW\GHVLJQPHWK @ZKLFKLQDGGLWLRQWRWKLVDSSURDFKSURYLGHVWKUHHRWKHUGXUDELOLW\GHVLJQPHWK
RGRORJLHV LH WKH VRFDOOHG ³SDUWLDO IDFWRU GHVLJQ´ ³GHHPHG WR VDWLVI\ GHVLJQ´ DQG RGRORJLHV LH WKH VRFDOOHG ³SDUWLDO IDFWRU GHVLJQ´ ³GHHPHG WR VDWLVI\ GHVLJQ´ DQG
³DYRLGDQFHRIGHWHULRUDWLRQ´7KH ³*XLGHWR'XUDEOH&RQFUHWH´>$&,5@ ³DYRLGDQFHRIGHWHULRUDWLRQ´7KH ³*XLGHWR'XUDEOH&RQFUHWH´>$&,5@
LQ FRPELQDWLRQ ZLWK WKH ³6HUYLFH/LIH 3UHGLFWLRQ 6WDWHRIWKH$UW 5HSRUW´ >$&, LQ FRPELQDWLRQ ZLWK WKH ³6HUYLFH/LIH 3UHGLFWLRQ 6WDWHRIWKH$UW 5HSRUW´ >$&,
5@FDQEHVHHQDVWKH86FRXQWHUSDUWWRWKHDERYHPHQWLRQHGSXEOLFDWLRQV 5@FDQEHVHHQDVWKH86FRXQWHUSDUWWRWKHDERYHPHQWLRQHGSXEOLFDWLRQV

 

 1RWRQO\DUFKLWHFWXUDOUHTXLUHPHQWVFDQIDYRXUDUHGXFWLRQRIWKHFRYHUWKLFNQHVV EDVHGRQDSSURSUL  1RWRQO\DUFKLWHFWXUDOUHTXLUHPHQWVFDQIDYRXUDUHGXFWLRQRIWKHFRYHUWKLFNQHVV EDVHGRQDSSURSUL
DWHFRXQWHUPHDVXUHV EXWLWLVRIWHQEHQHILFLDOIRUVWUXFWXUDOUHDVRQVLQSDUWLFXODUZLWKUHJDUGWR DWHFRXQWHUPHDVXUHV EXWLWLVRIWHQEHQHILFLDOIRUVWUXFWXUDOUHDVRQVLQSDUWLFXODUZLWKUHJDUGWR
FUDFNZLGWKOLPLWDWLRQV FI6HFWLRQ  FUDFNZLGWKOLPLWDWLRQV FI6HFWLRQ 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


'XUDELOLW\DQG6HUYLFH/LIH'HVLJQ $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV 'XUDELOLW\DQG6HUYLFH/LIH'HVLJQ $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

$OOVHUYLFHOLIHGHVLJQPRGHOVKDYHLQFRPPRQWKDWWKH\DUHEDVHGRQLQSXWSDUDPH $OOVHUYLFHOLIHGHVLJQPRGHOVKDYHLQFRPPRQWKDWWKH\DUHEDVHGRQLQSXWSDUDPH
WHUV ZKLFK DUH GHULYHG IURP WKH WKHRU\ RI WUDQVSRUWDWLRQ PHFKDQLVPV FI 6HFWLRQ WHUV ZKLFK DUH GHULYHG IURP WKH WKHRU\ RI WUDQVSRUWDWLRQ PHFKDQLVPV FI 6HFWLRQ
  LQ FRPELQDWLRQ ZLWK NQRZOHGJH RQ LQJUHVV DQG LRQ PRELOLW\ SDUDPHWHUV FI   LQ FRPELQDWLRQ ZLWK NQRZOHGJH RQ LQJUHVV DQG LRQ PRELOLW\ SDUDPHWHUV FI
6HFWLRQ   DQG RQ WKUHVKROG YDOXHV IRU LQLWLDWLRQ RI DFWLYH FRUURVLRQ FI 6HFWLRQ 6HFWLRQ   DQG RQ WKUHVKROG YDOXHV IRU LQLWLDWLRQ RI DFWLYH FRUURVLRQ FI 6HFWLRQ
   
$Q LPSRUWDQW FRQFHSW LQ VHUYLFH OLIH GHVLJQ ZKLFK FDPH LQWR IRFXV GXULQJ WKH ODVW $Q LPSRUWDQW FRQFHSW LQ VHUYLFH OLIH GHVLJQ ZKLFK FDPH LQWR IRFXV GXULQJ WKH ODVW
\HDUV LV OLIH F\FOH FRVWLQJ µ/&&¶  /LIH F\FOH FRVWLQJ FDQ HJ EH IRUPXODWHG DV DQ \HDUV LV OLIH F\FOH FRVWLQJ µ/&&¶  /LIH F\FOH FRVWLQJ FDQ HJ EH IRUPXODWHG DV DQ
RSWLPLVDWLRQ RI WKH QHW SUHVHQW YDOXH RI D FRQFUHWH VWUXFWXUH :LWKRXW D UDWLRQDO RSWLPLVDWLRQ RI WKH QHW SUHVHQW YDOXH RI D FRQFUHWH VWUXFWXUH :LWKRXW D UDWLRQDO
HYDOXDWLRQRIIXWXUHFRVWVLQDFRPSDUDEOHPDQQHUWRUDWHDOWHUQDWLYHVROXWLRQVVHUYLFH HYDOXDWLRQRIIXWXUHFRVWVLQDFRPSDUDEOHPDQQHUWRUDWHDOWHUQDWLYHVROXWLRQVVHUYLFH
OLIH GHVLJQ GRHV RIWHQ QRW VHHP WR EH DQ DWWUDFWLYH GHVLJQ SURFHGXUH 7KLV LV PDLQO\ OLIH GHVLJQ GRHV RIWHQ QRW VHHP WR EH DQ DWWUDFWLYH GHVLJQ SURFHGXUH 7KLV LV PDLQO\
GXHWRWKHIDFWWKDWWKHVDYLQJVLQIXWXUHPDLQWHQDQFHFRVWVDUHQRWDGHTXDWHO\FRQVLG GXHWRWKHIDFWWKDWWKHVDYLQJVLQIXWXUHPDLQWHQDQFHFRVWVDUHQRWDGHTXDWHO\FRQVLG
HUHG WR FRPSHQVDWH IRU WKH LQFUHDVHG LQLWLDO FRQVWUXFWLRQ FRVWV DOWKRXJK VXFK IXWXUH HUHG WR FRPSHQVDWH IRU WKH LQFUHDVHG LQLWLDO FRQVWUXFWLRQ FRVWV DOWKRXJK VXFK IXWXUH
VDYLQJVFDQEHVXEVWDQWLDO>9DO 6WHZDUW5RVWDP@ VDYLQJVFDQEHVXEVWDQWLDO>9DO 6WHZDUW5RVWDP@
,QJHQHUDOLWFDQEHVDLGWKDWGXUDELOLW\GHVLJQIRUUHLQIRUFHGFRQFUHWHVWUXFWXUHVLVIDU ,QJHQHUDOLWFDQEHVDLGWKDWGXUDELOLW\GHVLJQIRUUHLQIRUFHGFRQFUHWHVWUXFWXUHVLVIDU
PRUHFRQFHUQHGDERXWFKORULGHLQGXFHGFRUURVLRQWKDQFDUERQDWLRQLQGXFHGFRUURVLRQ PRUHFRQFHUQHGDERXWFKORULGHLQGXFHGFRUURVLRQWKDQFDUERQDWLRQLQGXFHGFRUURVLRQ
&DUERQDWLRQDORQHFDQJHQHUDOO\EHFRQWUROOHGZLWKVWDWHRIWKHDUWFRQFUHWHPL[WXUHV &DUERQDWLRQDORQHFDQJHQHUDOO\EHFRQWUROOHGZLWKVWDWHRIWKHDUWFRQFUHWHPL[WXUHV
DQGGHVLJQRIDGHTXDWHFRYHUGHSWKV,QWKLVUHVSHFWLWVKRXOGEHUHPDUNHGWKDWWKHUH DQGGHVLJQRIDGHTXDWHFRYHUGHSWKV,QWKLVUHVSHFWLWVKRXOGEHUHPDUNHGWKDWWKHUH
TXLUHPHQWVIRUWKHFRYHUGHSWKLQWKHQDWLRQDOFRQFUHWHGHVLJQFRGHV>'6(1 TXLUHPHQWVIRUWKHFRYHUGHSWKLQWKHQDWLRQDOFRQFUHWHGHVLJQFRGHV>'6(1
$&,5$&,050@DUHLQSULQFLSOHEDVHGRQWKH $&,5$&,050@DUHLQSULQFLSOHEDVHGRQWKH
FDUERQDWLRQ UDWH FI 6HFWLRQ   IRU FXVWRPDU\ HQYLURQPHQWV LQ UHODWLRQ WR WKH FDUERQDWLRQ UDWH FI 6HFWLRQ   IRU FXVWRPDU\ HQYLURQPHQWV LQ UHODWLRQ WR WKH
FRGLILHG VHUYLFHOLIHRIHJ\HDUV>5RVWDP@6RDVORQJDVWKHDUFKLWHFWXUDO FRGLILHG VHUYLFHOLIHRIHJ\HDUV>5RVWDP@6RDVORQJDVWKHDUFKLWHFWXUDO
GHVLJQDOORZVIRUSURYLVLRQRIVXIILFLHQWFRYHUGHSWKVFRUURVLRQLQGXFHGE\FDUERQD GHVLJQDOORZVIRUSURYLVLRQRIVXIILFLHQWFRYHUGHSWKVFRUURVLRQLQGXFHGE\FDUERQD
WLRQLVJHQHUDOO\QRWDQLVVXH+RZHYHUFKORULGHLQGXFHGFRUURVLRQDORQHRULQFRP WLRQLVJHQHUDOO\QRWDQLVVXH+RZHYHUFKORULGHLQGXFHGFRUURVLRQDORQHRULQFRP
ELQDWLRQ ZLWK FDUERQDWLRQ LV D PDMRU LVVXH IRU VWUXFWXUHV H[SRVHG WR VXFK HQYLURQ ELQDWLRQ ZLWK FDUERQDWLRQ LV D PDMRU LVVXH IRU VWUXFWXUHV H[SRVHG WR VXFK HQYLURQ
PHQWV$SDUWIURPWKHGHFUHDVHGH[WHQWRIWKHLQLWLDWLRQVWDJHWKHKLJKFRUURVLRQUDWHV PHQWV$SDUWIURPWKHGHFUHDVHGH[WHQWRIWKHLQLWLDWLRQVWDJHWKHKLJKFRUURVLRQUDWHV
REVHUYHG XQGHU FKORULGH LQGXFHG FRUURVLRQ HJ XS WR  WLPHV KLJKHU WKDQ IRU FDU REVHUYHG XQGHU FKORULGH LQGXFHG FRUURVLRQ HJ XS WR  WLPHV KLJKHU WKDQ IRU FDU
ERQDWLRQLQGXFHGFRUURVLRQ FI6HFWLRQ DVZHOODVWKHSRVVLEO\GDQJHURXVW\SHV ERQDWLRQLQGXFHGFRUURVLRQ FI6HFWLRQ DVZHOODVWKHSRVVLEO\GDQJHURXVW\SHV
RIGDPDJHLHWKHQRWFKOLNHDWWDFN FI6HFWLRQ DUHRIFRQFHUQIRUVWUXFWXUHV RIGDPDJHLHWKHQRWFKOLNHDWWDFN FI6HFWLRQ DUHRIFRQFHUQIRUVWUXFWXUHV
H[SRVHGWRFKORULGHHQYLURQPHQWV7KLVLVFRQILUPHGE\WKHIDFWWKDWWKHWHFKQLFDOVHU H[SRVHGWRFKORULGHHQYLURQPHQWV7KLVLVFRQILUPHGE\WKHIDFWWKDWWKHWHFKQLFDOVHU
YLFHOLIHLVRIWHQFRQVLGHUHGWRFRUUHVSRQGWRWKHLQLWLDWLRQSKDVHLIFKORULGHVDUHLQ YLFHOLIHLVRIWHQFRQVLGHUHGWRFRUUHVSRQGWRWKHLQLWLDWLRQSKDVHLIFKORULGHVDUHLQ
YROYHGLQWKHFRUURVLRQSURFHVV>&RVWD $SSOHWRQ@ YROYHGLQWKHFRUURVLRQSURFHVV>&RVWD $SSOHWRQ@
6R PRVW RI WKH DYDLODEOH FRXQWHUPHDVXUHV IRU QHZ DQG H[LVWLQJ VWUXFWXUHV FI 6HF 6R PRVW RI WKH DYDLODEOH FRXQWHUPHDVXUHV IRU QHZ DQG H[LVWLQJ VWUXFWXUHV FI 6HF
WLRQV  DQG  UHVSHFWLYHO\  SULPDULO\ DLP DW SUHYHQWLQJ FKORULGH LQGXFHG FRUUR WLRQV  DQG  UHVSHFWLYHO\  SULPDULO\ DLP DW SUHYHQWLQJ FKORULGH LQGXFHG FRUUR
VLRQ ZKHUH VHYHUDO PHDVXUHV LQ RXU RSLQLRQ VKRZ WKHUPRG\QDPLF  GHILFLHQFLHV VLRQ ZKHUH VHYHUDO PHDVXUHV LQ RXU RSLQLRQ VKRZ WKHUPRG\QDPLF  GHILFLHQFLHV
$OVR IRU WKH SURSRVHG QHZ FRXQWHUPHDVXUHV &KDSWHU   IRFXV ZDV VHW RQ FKORULGH $OVR IRU WKH SURSRVHG QHZ FRXQWHUPHDVXUHV &KDSWHU   IRFXV ZDV VHW RQ FKORULGH
LQGXFHG FRUURVLRQ ZKLOH UHVLVWDQFH WR FDUERQDWLRQ ZDV WDNHQ LQWR DFFRXQW DV D SD LQGXFHG FRUURVLRQ ZKLOH UHVLVWDQFH WR FDUERQDWLRQ ZDV WDNHQ LQWR DFFRXQW DV D SD
UDPHWHU DQG DOO RI RXU H[SHULPHQWDO LQYHVWLJDWLRQV FRQFHUQLQJ FRUURVLRQ UHVLVWDQFH UDPHWHU DQG DOO RI RXU H[SHULPHQWDO LQYHVWLJDWLRQV FRQFHUQLQJ FRUURVLRQ UHVLVWDQFH
ZHUHEDVHGRQFKORULGHH[SRVXUH FI6HFWLRQ  ZHUHEDVHGRQFKORULGHH[SRVXUH FI6HFWLRQ 
)LQDOO\LWLVLPSRUWDQWWRQRWHWKDWVHUYLFHOLIHGHVLJQRIFRQFUHWHVWUXFWXUHVGRHVQRW )LQDOO\LWLVLPSRUWDQWWRQRWHWKDWVHUYLFHOLIHGHVLJQRIFRQFUHWHVWUXFWXUHVGRHVQRW
RQO\ QHHG WR SURYLGH VXIILFLHQW PHDQV WR DYRLG UHLQIRUFHPHQW FRUURVLRQ EXW DOVR D RQO\ QHHG WR SURYLGH VXIILFLHQW PHDQV WR DYRLG UHLQIRUFHPHQW FRUURVLRQ EXW DOVR D

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV 6WDQGDUGV/LWHUDWXUHDQG2UJDQLVDWLRQV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV 6WDQGDUGV/LWHUDWXUHDQG2UJDQLVDWLRQV

QXPEHURIRWKHUGHWHULRUDWLRQPHFKDQLVPVWKDWDIIHFWWKH FRQFUHWH GLUHFWO\ 6RPH RI QXPEHURIRWKHUGHWHULRUDWLRQPHFKDQLVPVWKDWDIIHFWWKH FRQFUHWH GLUHFWO\ 6RPH RI
WKHPRVWLPSRUWDQWGLUHFWFRQFUHWHGHWHULRUDWLRQPHFKDQLVPVDUH WKHPRVWLPSRUWDQWGLUHFWFRQFUHWHGHWHULRUDWLRQPHFKDQLVPVDUH
‡ )UHH]HWKDZGDPDJH ‡ )UHH]HWKDZGDPDJH
‡ 7KHUPDOLQFRPSDWLELOLW\RIFRQFUHWHFRPSRQHQWV ‡ 7KHUPDOLQFRPSDWLELOLW\RIFRQFUHWHFRPSRQHQWV
‡ 6XOSKDWHDWWDFN ‡ 6XOSKDWHDWWDFN
‡ 6RIWZDWHURUDFLGDWWDFN ‡ 6RIWZDWHURUDFLGDWWDFN
‡ µ$65¶RUPRUHJHQHUDODONDOLDJJUHJDWHUHDFWLRQ µ$$5¶  ‡ µ$65¶RUPRUHJHQHUDODONDOLDJJUHJDWHUHDFWLRQ µ$$5¶ 
‡ 6DOWUHFU\VWDOOLVDWLRQ H[IROLDWLRQ  ‡ 6DOWUHFU\VWDOOLVDWLRQ H[IROLDWLRQ 
7KHVHPHFKDQLVPVDUHOLVWHGKHUHEXWQRWGLVFXVVHGLQGHWDLOZLWKLQWKHSUHVHQWWKHVLV 7KHVHPHFKDQLVPVDUHOLVWHGKHUHEXWQRWGLVFXVVHGLQGHWDLOZLWKLQWKHSUHVHQWWKHVLV
5HIHUHQFHLVPDGHWRDODUJHERG\RIOLWHUDWXUHWKDWH[LVWVRQWKHYDULRXVFRQFUHWHGHWH 5HIHUHQFHLVPDGHWRDODUJHERG\RIOLWHUDWXUHWKDWH[LVWVRQWKHYDULRXVFRQFUHWHGHWH
ULRUDWLRQ PHFKDQLVPV HJ >1HYLOOH  $&, 5  5HQGHOO HWDO  ULRUDWLRQ PHFKDQLVPV HJ >1HYLOOH  $&, 5  5HQGHOO HWDO 
0LQGHVVHWDO5LFKDUGVRQ%HUWROLQLHWDO@ 0LQGHVVHWDO5LFKDUGVRQ%HUWROLQLHWDO@

 6WDQGDUGV/LWHUDWXUHDQG2UJDQLVDWLRQV  6WDQGDUGV/LWHUDWXUHDQG2UJDQLVDWLRQV


*UHDWHIIRUWKDVEHHQPDGHWRZRUNRXWDXQLILHG(XURSHDQVWDQGDUGIRUSURWHFWLRQDQG *UHDWHIIRUWKDVEHHQPDGHWRZRUNRXWDXQLILHG(XURSHDQVWDQGDUGIRUSURWHFWLRQDQG
UHSDLURIFRQFUHWHVWUXFWXUHV>5DXSDFK@$IWHUPRUHWKDQWHQ\HDUVRILQWHQVLYH UHSDLURIFRQFUHWHVWUXFWXUHV>5DXSDFK@$IWHUPRUHWKDQWHQ\HDUVRILQWHQVLYH
GLVFXVVLRQVZLWKLQGLIIHUHQWZRUNLQJJURXSVWKH(1>'6(1@VH GLVFXVVLRQVZLWKLQGLIIHUHQWZRUNLQJJURXSVWKH(1>'6(1@VH
ULHVRIVWDQGDUGVLVQRZILQDOLVHGDQGDWSUHVHQWWKH(XURSHDQ&RXQWULHVDUHUHSODFLQJ ULHVRIVWDQGDUGVLVQRZILQDOLVHGDQGDWSUHVHQWWKH(XURSHDQ&RXQWULHVDUHUHSODFLQJ
WKHLU H[LVWLQJ QDWLRQDO VWDQGDUGV DQG UHFRPPHQGDWLRQV E\ WKH QHZ (1  VHULHV WKHLU H[LVWLQJ QDWLRQDO VWDQGDUGV DQG UHFRPPHQGDWLRQV E\ WKH QHZ (1  VHULHV
$FFRUGLQJWR>5DXSDFK@LWFDQEHDVVXPHGWKDWWKH(1VHULHVZLOOKDYHD $FFRUGLQJWR>5DXSDFK@LWFDQEHDVVXPHGWKDWWKH(1VHULHVZLOOKDYHD
VLJQLILFDQW LPSDFW RQ QRQ(XURSHDQ FRXQWULHV DV ZHOO )LJXUH  VXPPDULVHV WKH VLJQLILFDQW LPSDFW RQ QRQ(XURSHDQ FRXQWULHV DV ZHOO )LJXUH  VXPPDULVHV WKH
VWUXFWXUH RI WKH (1  VHULHV ZKLFK FRQVLVWV RI WHQ PDLQ VWDQGDUGV DQG DERXW  VWUXFWXUH RI WKH (1  VHULHV ZKLFK FRQVLVWV RI WHQ PDLQ VWDQGDUGV DQG DERXW 
VWDQGDUGVIRUWHVWPHWKRGVLHFRPSOLDQFHWHVWV  VWDQGDUGVIRUWHVWPHWKRGVLHFRPSOLDQFHWHVWV 

 
)LJXUH 6WUXFWXUH RI QHZ(XURSHDQVWDQGDUGVHULHV(1  >'6(1  )LJXUH 6WUXFWXUHRIQHZ(XURSHDQVWDQGDUGVHULHV(1  >'6(1 
@$IWHU>5DXSDFK@ @$IWHU>5DXSDFK@
 

7KHFRPSOLDQFHWHVWVUHODWLQJWRDFHUWDLQFRXQWHUPHDVXUHDUHQRWUHIHUUHGWREHFDXVHWKHUHOHYDQWWHVW 7KHFRPSOLDQFHWHVWVUHODWLQJWRDFHUWDLQFRXQWHUPHDVXUHDUHQRWUHIHUUHGWREHFDXVHWKHUHOHYDQWWHVW
PHWKRGVDUHOLVWHGLQWKHDVVRFLDWHGPDLQVWDQGDUG7KHVDPHKROGVIRURWKHUWHVWPHWKRGVFRQFHUQLQJ PHWKRGVDUHOLVWHGLQWKHDVVRFLDWHGPDLQVWDQGDUG7KHVDPHKROGVIRURWKHUWHVWPHWKRGVFRQFHUQLQJ
FRXQWHUPHDVXUHVHJSXEOLVKHGE\$670 FRXQWHUPHDVXUHVHJSXEOLVKHGE\$670

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


6WDQGDUGV/LWHUDWXUHDQG2UJDQLVDWLRQV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV 6WDQGDUGV/LWHUDWXUHDQG2UJDQLVDWLRQV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

$VVKRZQLQ)LJXUHWKHVHULHVRIVWDQGDUGVLVIRFXVHGRQSDUWVWRZKLFKDUH $VVKRZQLQ)LJXUHWKHVHULHVRIVWDQGDUGVLVIRFXVHGRQSDUWVWRZKLFKDUH
WKHEDVLVIRU&(PDUNLQJRIWKHGLIIHUHQWSURGXFWVDQGV\VWHPVWREHXVHGIRUSURWHF WKHEDVLVIRU&(PDUNLQJRIWKHGLIIHUHQWSURGXFWVDQGV\VWHPVWREHXVHGIRUSURWHF
WLRQDQGUHSDLURIFRQFUHWHVWUXFWXUHV+RZHYHUSDUWRI(1LVQRWOHVVLPSRU WLRQDQGUHSDLURIFRQFUHWHVWUXFWXUHV+RZHYHUSDUWRI(1LVQRWOHVVLPSRU
WDQWEHFDXVHLWGHVFULEHVWKHSULQFLSOHVIRUWKHXVHRIWKHSURGXFWV)XUWKHUPRUHSDUW WDQWEHFDXVHLWGHVFULEHVWKHSULQFLSOHVIRUWKHXVHRIWKHSURGXFWV)XUWKHUPRUHSDUW
SURYLGHVWKHGHILQLWLRQVSDUWUHJXODWHVWKHTXDOLW\FRQWURORIWKHSURGXFWVDQGSDUW SURYLGHVWKHGHILQLWLRQVSDUWUHJXODWHVWKHTXDOLW\FRQWURORIWKHSURGXFWVDQGSDUW
SURYLGHVDJHQHUDOJXLGHOLQHIRUVLWHDSSOLFDWLRQDQGTXDOLW\FRQWURORIWKHH[HFX SURYLGHVDJHQHUDOJXLGHOLQHIRUVLWHDSSOLFDWLRQDQGTXDOLW\FRQWURORIWKHH[HFX
WLRQ WLRQ
7KH(1VWDQGDUGVHULHVLVUDWKHUFRGLILHGDQGWKHUHIRUHPDQ\QDWLRQDOVWDQGDUG 7KH(1VWDQGDUGVHULHVLVUDWKHUFRGLILHGDQGWKHUHIRUHPDQ\QDWLRQDOVWDQGDUG
DXWKRULWLHV SXEOLVKHG KDQGERRNV VXSSOHPHQWDU\ WR WKH VHULHV HJ '6 UHFHQWO\ SXE DXWKRULWLHV SXEOLVKHG KDQGERRNV VXSSOHPHQWDU\ WR WKH VHULHV HJ '6 UHFHQWO\ SXE
OLVKHG ³&RQFUHWH3DUW  *XLGDQFH IRU UHQRYDWLRQ RI FRQFUHWH VWUXFWXUHV  5HSDLU OLVKHG ³&RQFUHWH3DUW  *XLGDQFH IRU UHQRYDWLRQ RI FRQFUHWH VWUXFWXUHV  5HSDLU
PDWHULDOVDQGV\VWHPVDFFRUGLQJWRWKH(1VHULHV´>'6@ PDWHULDOVDQGV\VWHPVDFFRUGLQJWRWKH(1VHULHV´>'6@
%DVLFDOO\WKHUHLVQRHTXLYDOHQWWRWKH(1VHULHVRQWKH86PDUNHW+RZHYHU %DVLFDOO\WKHUHLVQRHTXLYDOHQWWRWKH(1VHULHVRQWKH86PDUNHW+RZHYHU
WKH $&, SXEOLFDWLRQV ³3URWHFWLRQ RI 0HWDOV LQ &RQFUHWH $JDLQVW &RUURVLRQ´ >$&, WKH $&, SXEOLFDWLRQV ³3URWHFWLRQ RI 0HWDOV LQ &RQFUHWH $JDLQVW &RUURVLRQ´ >$&,
5 @ LQ FRPELQDWLRQ ZLWK WKH ³&RQFUHWH 5HSDLU *XLGH´ >$&, 5 @ 5 @ LQ FRPELQDWLRQ ZLWK WKH ³&RQFUHWH 5HSDLU *XLGH´ >$&, 5 @
ZKLFK LV DPRQJ RWKHU UHODWHG SXEOLFDWLRQV DOVR LQFOXGHG LQ WKH ³&RQFUHWH 5HSDLU ZKLFK LV DPRQJ RWKHU UHODWHG SXEOLFDWLRQV DOVR LQFOXGHG LQ WKH ³&RQFUHWH 5HSDLU
0DQXDO´>$&,HWDO@FDQEHUHJDUGHGDVDQHTXLYDOHQWWRWKH(XURSHDQVWDQGDUG 0DQXDO´>$&,HWDO@FDQEHUHJDUGHGDVDQHTXLYDOHQWWRWKH(XURSHDQVWDQGDUG
VHULHV VHULHV
$SDUWIURPWKHVHVWDQGDUGVDQGJXLGHOLQHVDVZHOODVRWKHUUHOHYDQW&(1$670DQG $SDUWIURPWKHVHVWDQGDUGVDQGJXLGHOLQHVDVZHOODVRWKHUUHOHYDQW&(1$670DQG
$&,SXEOLFDWLRQVWKHUHDUHYDULRXVRWKHUUHFRPPHQGDWLRQVDQGJXLGHOLQHVSXEOLVKHG $&,SXEOLFDWLRQVWKHUHDUHYDULRXVRWKHUUHFRPPHQGDWLRQVDQGJXLGHOLQHVSXEOLVKHG
ZLWKUHJDUGWRWKHEURDGILHOGRIGXUDELOLW\GHVLJQDQGUHLQIRUFHPHQWFRUURVLRQFRXQ ZLWKUHJDUGWRWKHEURDGILHOGRIGXUDELOLW\GHVLJQDQGUHLQIRUFHPHQWFRUURVLRQFRXQ
WHUPHDVXUHV E\ RWKHU (XURSHDQ DQG 86 RUJDQLVDWLRQV 5HFRPPHQGDWLRQV DQG JXLGH WHUPHDVXUHV E\ RWKHU (XURSHDQ DQG 86 RUJDQLVDWLRQV 5HFRPPHQGDWLRQV DQG JXLGH
OLQHVWKDWZHFRQVLGHUHGWREHPRVWUHOHYDQWIRUFRXQWHUPHDVXUHVZHUHSXEOLVKHGE\ OLQHVWKDWZHFRQVLGHUHGWREHPRVWUHOHYDQWIRUFRXQWHUPHDVXUHVZHUHSXEOLVKHGE\
‡ &RQFUHWH6RFLHW\ &6 %ODFNZDWHU8. ‡ &RQFUHWH6RFLHW\ &6 %ODFNZDWHU8.
‡ 'HXWVFKHU $XVVFKXVV IU 6WDKOEHWRQ '$I6W%  *HUPDQ &RPPLVVLRQ IRU 5HLQ ‡ 'HXWVFKHU $XVVFKXVV IU 6WDKOEHWRQ '$I6W%  *HUPDQ &RPPLVVLRQ IRU 5HLQ
IRUFHG&RQFUHWH%HUOLQ*HUPDQ\ IRUFHG&RQFUHWH%HUOLQ*HUPDQ\
‡ (XURSHDQ)HGHUDWLRQRI&RUURVLRQ ()& /RQGRQ8. ‡ (XURSHDQ)HGHUDWLRQRI&RUURVLRQ ()& /RQGRQ8.
‡ )pGpUDWLRQ ,QWHUQDWLRQDOH GX %pWRQ ILE  ,QWHUQDWLRQDO )HGHUDWLRQ IRU 6WUXFWXUDO ‡ )pGpUDWLRQ ,QWHUQDWLRQDOH GX %pWRQ ILE  ,QWHUQDWLRQDO )HGHUDWLRQ IRU 6WUXFWXUDO
&RQFUHWH/DXVDQQH6ZLW]HUODQG  &RQFUHWH/DXVDQQH6ZLW]HUODQG 
‡ 1$&( ,QWHUQDWLRQDO IRUPHUO\ NQRZQ DV WKH 1DWLRQDO $VVRFLDWLRQ RI &RUURVLRQ ‡ 1$&( ,QWHUQDWLRQDO IRUPHUO\ NQRZQ DV WKH 1DWLRQDO $VVRFLDWLRQ RI &RUURVLRQ
(QJLQHHUV 1$&( +RXVWRQ7;86$ (QJLQHHUV 1$&( +RXVWRQ7;86$
‡ ,QWHUQDWLRQDO 8QLRQ RI /DERUDWRULHV DQG ([SHUWV LQ &RQVWUXFWLRQ 0DWHULDOV 6\V ‡ ,QWHUQDWLRQDO 8QLRQ RI /DERUDWRULHV DQG ([SHUWV LQ &RQVWUXFWLRQ 0DWHULDOV 6\V
WHPVDQG6WUXFWXUHV 5,/(0 %DJQHX[)UDQFH WHPVDQG6WUXFWXUHV 5,/(0 %DJQHX[)UDQFH
,QWKLVFRQQHFWLRQILEVKRXOGEHSDUWLFXODUO\PHQWLRQHGEHFDXVHWKH0RGHO&RGH ,QWKLVFRQQHFWLRQILEVKRXOGEHSDUWLFXODUO\PHQWLRQHGEHFDXVHWKH0RGHO&RGH
>ILE @ DQG 0RGHO &RGH  >ILE @ SXEOLVKHG E\ ILE &(%),3  ZKLFK DUH >ILE @ DQG 0RGHO &RGH  >ILE @ SXEOLVKHG E\ ILE &(%),3  ZKLFK DUH
SUHGHFHVVRUVWRWKHFXUUHQW³0RGHO&RGHIRU6HUYLFH/LIH'HVLJQ´>ILE@ FI6HF SUHGHFHVVRUVWRWKHFXUUHQW³0RGHO&RGHIRU6HUYLFH/LIH'HVLJQ´>ILE@ FI6HF
 

ILEZDVIRXQGHGLQDVDXQLRQEHWZHHQWKH&RPLWp(XURLQWHUQDWLRQDOGX%pWRQ &(% DQGWKH ILEZDVIRXQGHGLQDVDXQLRQEHWZHHQWKH&RPLWp(XURLQWHUQDWLRQDOGX%pWRQ &(% DQGWKH
)pGpUDWLRQ,QWHUQDWLRQDOHGHOD3UpFRQWUDLQWH ),3 ,WVKRXOGEHQRWHGWKDWLQWKHSUHVHQWWKHVLVDOO )pGpUDWLRQ,QWHUQDWLRQDOHGHOD3UpFRQWUDLQWH ),3 ,WVKRXOGEHQRWHGWKDWLQWKHSUHVHQWWKHVLVDOO
&(%DQG),3SXEOLFDWLRQVDUHUHIHUHQFHGDVILESXEOLFDWLRQV &(%DQG),3SXEOLFDWLRQVDUHUHIHUHQFHGDVILESXEOLFDWLRQV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV

WLRQ   KDG D PDMRU LPSDFW RQ WKH FRGH GUDIWLQJ ZLWK UHJDUGWRGXUDELOLW\UHTXLUH WLRQ   KDG D PDMRU LPSDFW RQ WKH FRGH GUDIWLQJ ZLWK UHJDUGWRGXUDELOLW\UHTXLUH
PHQWV IRU PDQ\ QDWLRQDO DQG LQWHUQDWLRQDO VWDQGDUGLVLQJ ERGLHV HJ D ODUJH SDUW RI PHQWV IRU PDQ\ QDWLRQDO DQG LQWHUQDWLRQDO VWDQGDUGLVLQJ ERGLHV HJ D ODUJH SDUW RI
(XURFRGH>'6(1@LVEDVHGRQ0RGHO&RGH>ILE@,QUHOD (XURFRGH>'6(1@LVEDVHGRQ0RGHO&RGH>ILE@,QUHOD
WLRQ WR WKH LPSRUWDQW 0RGHO &RGH  H[WHQVLYH EDFNJURXQG LQIRUPDWLRQ ZDV DGGL WLRQ WR WKH LPSRUWDQW 0RGHO &RGH  H[WHQVLYH EDFNJURXQG LQIRUPDWLRQ ZDV DGGL
WLRQDOO\SXEOLVKHGE\ILELQDVHULHVRIWH[WERRNV>ILEFILEDILEE@ WLRQDOO\SXEOLVKHGE\ILELQDVHULHVRIWH[WERRNV>ILEFILEDILEE@
%HVLGHV WKH DERYH PHQWLRQHG VWDQGDUGV UHFRPPHQGDWLRQV DQG JXLGHOLQHV WKHUH DUH %HVLGHV WKH DERYH PHQWLRQHG VWDQGDUGV UHFRPPHQGDWLRQV DQG JXLGHOLQHV WKHUH DUH
RWKHUH[WHQVLYHSXEOLFDWLRQVGHDOLQJH[FOXVLYHO\ZLWKFHUWDLQFRXQWHUPHDVXUHVDVZHOO RWKHUH[WHQVLYHSXEOLFDWLRQVGHDOLQJH[FOXVLYHO\ZLWKFHUWDLQFRXQWHUPHDVXUHVDVZHOO
DV VHYHUDO WH[WERRNV RQ UHLQIRUFHPHQW FRUURVLRQ DQGRU GXUDELOLW\ GHVLJQ WKDW RIWHQ DV VHYHUDO WH[WERRNV RQ UHLQIRUFHPHQW FRUURVLRQ DQGRU GXUDELOLW\ GHVLJQ WKDW RIWHQ
LQFOXGH GHWDLOHG GHVFULSWLRQV RI YDULRXV FRXQWHUPHDVXUHV HJ >0D\V HWDO  LQFOXGH GHWDLOHG GHVFULSWLRQV RI YDULRXV FRXQWHUPHDVXUHV HJ >0D\V HWDO 
6DUMD  9HVLNDUL  %URRPILHOG  %HQWXU HWDO  &LJQD HWDO  6DUMD  9HVLNDUL  %URRPILHOG  %HQWXU HWDO  &LJQD HWDO 
%HUWROLQLHWDO%|KQLHWDO5DXSDFKHWDO@ %HUWROLQLHWDO%|KQLHWDO5DXSDFKHWDO@

 &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV  &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV


$V PHQWLRQHG LQ &KDSWHU µ7D'¶ FRXQWHUPHDVXUHV IRU QHZ VWUXFWXUHV DUH VXEGLYLGHG $V PHQWLRQHG LQ &KDSWHU µ7D'¶ FRXQWHUPHDVXUHV IRU QHZ VWUXFWXUHV DUH VXEGLYLGHG
LQWRWZRJURXSVLQWKHSUHVHQWWKHVLV LQWRWZRJURXSVLQWKHSUHVHQWWKHVLV
‡ &RQFUHWHFRXQWHUPHDVXUHV ‡ &RQFUHWHFRXQWHUPHDVXUHV
&RQFUHWHFRXQWHUPHDVXUHVLQWKLVWKHVLVLQFOXGHPHDVXUHVWRUHGXFHWKHSHUPHDELO &RQFUHWHFRXQWHUPHDVXUHVLQWKLVWKHVLVLQFOXGHPHDVXUHVWRUHGXFHWKHSHUPHDELO
LW\RIWKHFRQFUHWHEXONFRQFUHWHVXUIDFHSURWHFWLRQLQWHJUDOFRUURVLRQLQKLELWRUV LW\RIWKHFRQFUHWHEXONFRQFUHWHVXUIDFHSURWHFWLRQLQWHJUDOFRUURVLRQLQKLELWRUV
DQGPHDVXUHVWRLPSURYHWKHFRQFUHWHVWHHOLQWHUIDFH DQGPHDVXUHVWRLPSURYHWKHFRQFUHWHVWHHOLQWHUIDFH
‡ 5HLQIRUFHPHQWFRXQWHUPHDVXUHV ‡ 5HLQIRUFHPHQWFRXQWHUPHDVXUHV
5HLQIRUFHPHQW FRXQWHUPHDVXUHV LQ WKLV WKHVLV LQFOXGH QRQPHWDOOLF RUJDQLF 5HLQIRUFHPHQW FRXQWHUPHDVXUHV LQ WKLV WKHVLV LQFOXGH QRQPHWDOOLF RUJDQLF
FRDWHGPRUHFRUURVLRQUHVLVWDQWFODGGHGDQGJDOYDQLVHGUHLQIRUFHPHQWDVZHOODV FRDWHGPRUHFRUURVLRQUHVLVWDQWFODGGHGDQGJDOYDQLVHGUHLQIRUFHPHQWDVZHOODV
FDWKRGLFSUHYHQWLRQ FDWKRGLFSUHYHQWLRQ
7KHPRVWLPSRUWDQWFKDUDFWHULVWLFVRIWKHVHWZRJURXSVRIFRXQWHUPHDVXUHVDUHVXP 7KHPRVWLPSRUWDQWFKDUDFWHULVWLFVRIWKHVHWZRJURXSVRIFRXQWHUPHDVXUHVDUHVXP
PDULVHGDQGHYDOXDWHGLQ6HFWLRQVDQG PDULVHGDQGHYDOXDWHGLQ6HFWLRQVDQG

 &RQFUHWH&RXQWHUPHDVXUHV  &RQFUHWH&RXQWHUPHDVXUHV


$V GHVFULEHG LQ 6HFWLRQV  WKH FRQFUHWHSURSHUWLHV FRQWUROWKHLQJUHVVRIFDUERQ $V GHVFULEHG LQ 6HFWLRQV  WKH FRQFUHWHSURSHUWLHV FRQWURO WKH LQJUHVV RIFDUERQ
GLR[LGHFKORULGHDQGR[\JHQDVZHOODVWKHLRQPRELOLW\ZKLFKDOOKDYHDPDMRUHI GLR[LGHFKORULGHDQGR[\JHQDVZHOODVWKHLRQPRELOLW\ZKLFKDOOKDYHDPDMRUHI
IHFWRQFRUURVLRQLQLWLDWLRQDQGSURSDJDWLRQ%HVLGHVWKHJHQHUDOPHDVXUHVWRSURYLGHD IHFWRQFRUURVLRQLQLWLDWLRQDQGSURSDJDWLRQ%HVLGHVWKHJHQHUDOPHDVXUHVWRSURYLGHD
VXIILFLHQWO\ WKLFN DQG GHQVH FRQFUHWH FRYHU FI 6HFWLRQ   WKH VHOHFWHG FRQFUHWH VXIILFLHQWO\ WKLFN DQG GHQVH FRQFUHWH FRYHU FI 6HFWLRQ   WKH VHOHFWHG FRQFUHWH
FRXQWHUPHDVXUHVLQFOXGH FRXQWHUPHDVXUHVLQFOXGH
‡ 0LQHUDO DGGLWLRQV VXSSOHPHQWDU\ FHPHQWLWLRXV PDWHULDOV  DQG FKHPLFDO DGPL[ ‡ 0LQHUDO DGGLWLRQV VXSSOHPHQWDU\ FHPHQWLWLRXV PDWHULDOV  DQG FKHPLFDO DGPL[
WXUHVWRGHFUHDVHWKHSHUPHDELOLW\ 6HFWLRQ  WXUHVWRGHFUHDVHWKHSHUPHDELOLW\ 6HFWLRQ 
‡ 3RVWFDVWLQJGHQVLILFDWLRQWHFKQLTXHV 6HFWLRQ  ‡ 3RVWFDVWLQJGHQVLILFDWLRQWHFKQLTXHV 6HFWLRQ 
‡ &RQFUHWHVXUIDFHSURWHFWLRQ 6HFWLRQ  ‡ &RQFUHWHVXUIDFHSURWHFWLRQ 6HFWLRQ 
‡ ,QWHJUDOFRUURVLRQLQKLELWRUV 6HFWLRQ  ‡ ,QWHJUDOFRUURVLRQLQKLELWRUV 6HFWLRQ 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

‡ (OHFWURFKHPLFDOFRQFUHWHVWHHOLQWHUIDFHLPSURYHPHQW 6HFWLRQ  ‡ (OHFWURFKHPLFDOFRQFUHWHVWHHOLQWHUIDFHLPSURYHPHQW 6HFWLRQ 


3RVWFDVWLQJ GHQVLILFDWLRQ WHFKQLTXHV DUH RQO\ RI PDUJLQDO XVH DQG HOHFWURFKHPLFDO 3RVWFDVWLQJ GHQVLILFDWLRQ WHFKQLTXHV DUH RQO\ RI PDUJLQDO XVH DQG HOHFWURFKHPLFDO
FRQFUHWHVWHHO LQWHUIDFH LPSURYHPHQW DUH WR RXU NQRZOHGJH QRW DSSOLHG LQ SUDFWLFH FRQFUHWHVWHHO LQWHUIDFH LPSURYHPHQW DUH WR RXU NQRZOHGJH QRW DSSOLHG LQ SUDFWLFH
$SDUWIURPWKHVHWKHDERYHOLVWHGFRQFUHWHFRXQWHUPHDVXUHVDUHVWDQGDUGWHFKQLTXHV $SDUWIURPWKHVHWKHDERYHOLVWHGFRQFUHWHFRXQWHUPHDVXUHVDUHVWDQGDUGWHFKQLTXHV
WKDWDUHLQPRUHRUOHVVGHWDLOGHVFULEHGLQWKHWH[WERRNVOLVWHGLQ6HFWLRQ WKDWDUHLQPRUHRUOHVVGHWDLOGHVFULEHGLQWKHWH[WERRNVOLVWHGLQ6HFWLRQ

 0LQHUDO$GGLWLRQVDQG&KHPLFDO$GPL[WXUHV  0LQHUDO$GGLWLRQVDQG&KHPLFDO$GPL[WXUHV


&RQFUHWH ZKHUH WKH VHOHFWLRQ DQG SURSRUWLRQLQJ RI LWV FRQVWLWXHQWV KDYH OHG WR LP &RQFUHWH ZKHUH WKH VHOHFWLRQ DQG SURSRUWLRQLQJ RI LWV FRQVWLWXHQWV KDYH OHG WR LP
SURYHPHQWRIRQHRUPRUHSURSHUWLHVLVRIWHQUHIHUUHGWRDVKLJKSHUIRUPDQFHFRQFUHWH SURYHPHQWRIRQHRUPRUHSURSHUWLHVLVRIWHQUHIHUUHGWRDVKLJKSHUIRUPDQFHFRQFUHWH
µ+3&¶ 1HYLOOH  &KHPLFDODGPL[WXUHVLQIRUPRISODVWLFLVHUV DQG VXSHUSODVWL µ+3&¶ 1HYLOOH  &KHPLFDODGPL[WXUHVLQIRUPRISODVWLFLVHUV DQG VXSHUSODVWL
FLVHUVDOORZWKHµZF¶ WREHORZHUHG,QSUDFWLFHµZF¶UDWLRVEHWZHHQDQGFDQ FLVHUVDOORZWKHµZF¶ WREHORZHUHG,QSUDFWLFHµZF¶UDWLRVEHWZHHQDQGFDQ
EH REWDLQHG LQ WKLV ZD\ ZKLOH VWLOO SURYLGLQJ IRU ZRUNDEOH FRQFUHWHV $ IXUWKHU UH EH REWDLQHG LQ WKLV ZD\ ZKLOH VWLOO SURYLGLQJ IRU ZRUNDEOH FRQFUHWHV $ IXUWKHU UH
GXFHGSHUPHDELOLW\PD\ EHREWDLQHG ZKHQ PLQHUDO DGGLWLRQV OLNH VLOLFDIXPH µ6)¶  GXFHGSHUPHDELOLW\PD\ EHREWDLQHGZKHQPLQHUDODGGLWLRQVOLNH VLOLFDIXPH µ6)¶ 
JURXQGJUDQXODWHGEODVWIXUQDFHVODJ µ**%6¶ DQGRUSXOYHULVHGIO\DVK µ3)$¶ DUH JURXQGJUDQXODWHGEODVWIXUQDFHVODJ µ**%6¶ DQGRUSXOYHULVHGIO\DVK µ3)$¶ DUH
XVHG&RQVWLWXHQWVRIµ+3&¶DUHJRYHUQHGE\YDULRXVVWDQGDUGVFKHPLFDODGPL[WXUHV XVHG&RQVWLWXHQWVRIµ+3&¶DUHJRYHUQHGE\YDULRXVVWDQGDUGVFKHPLFDODGPL[WXUHV
>'6(1   $670 &0 @ VLOLFD IXPH >'6(1   >'6(1   $670 &0 @ VLOLFD IXPH >'6(1  
$670 & @SXOYHULVHGIO\ DVK>'6(1 $670 & @ $670&@SXOYHULVHGIO\ DVK>'6(1 $670 & @
JURXQG JUDQXODWHG EODVWIXUQDFH VODJ >'6(1   $670 & @ JURXQG JUDQXODWHG EODVWIXUQDFH VODJ >'6(1   $670 & @
EOHQGHG FHPHQWV >'6(1   $670 & @ DQG E\ WKH DGGLWLRQDO EOHQGHG FHPHQWV >'6(1   $670 & @ DQG E\ WKH DGGLWLRQDO
$670 VSHFLILFDWLRQV IRU K\GUDXOLF FHPHQWV >$670 &  $670 & $670 VSHFLILFDWLRQV IRU K\GUDXOLF FHPHQWV >$670 &  $670 &
@ ZKLFK KDYH WR EH DSSOLHG LQ FRPSOLDQFH ZLWK WKH DVVRFLDWHG QDWLRQDO FHPHQW @ ZKLFK KDYH WR EH DSSOLHG LQ FRPSOLDQFH ZLWK WKH DVVRFLDWHG QDWLRQDO FHPHQW
DQGFRQFUHWHVWDQGDUGV FI6HFWLRQ DVZHOODVWKHEXLOGLQJFRGHVDQGUHJXODWLRQV DQGFRQFUHWHVWDQGDUGV FI6HFWLRQ DVZHOODVWKHEXLOGLQJFRGHVDQGUHJXODWLRQV
FI6HFWLRQ %HVLGHVWKHVHVWDQGDUGVVHYHUDOJXLGHOLQHVDQGDEXQGDQWRWKHUOLWHUD FI6HFWLRQ %HVLGHVWKHVHVWDQGDUGVVHYHUDOJXLGHOLQHVDQGDEXQGDQWRWKHUOLWHUD
WXUH KDV EHHQ SXEOLVKHG RQ µ+3&¶ DQG LWV FRQVWLWXHQWV )RU LQVWDQFH µ+3&¶ LV GHDOW WXUH KDV EHHQ SXEOLVKHG RQ µ+3&¶ DQG LWV FRQVWLWXHQWV )RU LQVWDQFH µ+3&¶ LV GHDOW
ZLWKLQGHWDLOLQDQ$&,VWDWHRIWKHDUWUHSRUW>$&,5@DQGDJXLGHWRTXDO ZLWKLQGHWDLOLQDQ$&,VWDWHRIWKHDUWUHSRUW>$&,5@DQGDJXLGHWRTXDO
LW\FRQWURODQGWHVWLQJ>$&,5@DV ZHOODVLQ ILESXEOLFDWLRQVFRQFHUQLQJ LW\FRQWURODQGWHVWLQJ>$&,5@DV ZHOODVLQ ILESXEOLFDWLRQVFRQFHUQLQJ
WKH JHQHUDO DSSOLFDWLRQ RI µ+3&¶ >ILE @ DQG D UHFRPPHQGHG H[WHQVLRQ WR WKH WKH JHQHUDO DSSOLFDWLRQ RI µ+3&¶ >ILE @ DQG D UHFRPPHQGHG H[WHQVLRQ WR WKH
&(%),30RGHO&RGH>ILEE@ &(%),30RGHO&RGH>ILEE@
7KHUHLVDJHQHUDODJUHHPHQWWKDWµ+3&¶KDVDODUJHO\UHGXFHGSHUPHDELOLW\FRPSDUHG 7KHUHLVDJHQHUDODJUHHPHQWWKDWµ+3&¶KDVDODUJHO\UHGXFHGSHUPHDELOLW\FRPSDUHG
WRRUGLQDU\FRQFUHWH HJIURPWHQWRWKRXVDQGIROG>1HYLOOH@ GXHWRFKDQJHVLQ WRRUGLQDU\FRQFUHWH HJIURPWHQWRWKRXVDQGIROG>1HYLOOH@ GXHWRFKDQJHVLQ
WKHSRUHVWUXFWXUH FI6HFWLRQ ,ISURSHUO\SODFHGDQGFXUHGµ+3&¶LPSURYHVWKH WKHSRUHVWUXFWXUH FI6HFWLRQ ,ISURSHUO\SODFHGDQGFXUHGµ+3&¶LPSURYHVWKH
FRUURVLRQSURWHFWLRQRIWKHUHLQIRUFHPHQW JLYHQWKHFULWLFDOFKORULGH FRQFHQWUDWLRQ LV FRUURVLRQSURWHFWLRQRIWKHUHLQIRUFHPHQW JLYHQWKHFULWLFDOFKORULGH FRQFHQWUDWLRQ LV
QRWUHGXFHGGXHWRDORZHUFKORULGHELQGLQJFDSDFLW\DQGRUDUHGXFHGS+RIWKHSRUH QRWUHGXFHGGXHWRDORZHUFKORULGHELQGLQJFDSDFLW\DQGRUDUHGXFHGS+RIWKHSRUH
VROXWLRQ 7KH EHQHILFLDO HIIHFWV RI SURSHUO\ FKRVHQ DQG SURSRUWLRQHG SR]]RODQV RU VROXWLRQ 7KH EHQHILFLDO HIIHFWV RI SURSHUO\ FKRVHQ DQG SURSRUWLRQHG SR]]RODQV RU
VODJVRQFRPSUHVVLYHVWUHQJWKDQGFRUURVLRQUHODWHGSURSHUWLHVDUHLOOXVWUDWHGLQ)LJXUH VODJVRQFRPSUHVVLYHVWUHQJWKDQGFRUURVLRQUHODWHGSURSHUWLHVDUHLOOXVWUDWHGLQ)LJXUH
 

 

7HFKQLFDOO\ZDWHUELQGHUUDWLR µZE¶ ZRXOGEHWKHFRUUHFWWHUPEHFDXVHGLIIHUHQWELQGHUVDUHXVHG 7HFKQLFDOO\ZDWHUELQGHUUDWLR µZE¶ ZRXOGEHWKHFRUUHFWWHUPEHFDXVHGLIIHUHQWELQGHUVDUHXVHG
LQWKHµ+3&¶PL[ZKLFKVXSSOHPHQWRUUHSODFHWKH3RUWODQGFHPHQW FI6HFWLRQ  LQWKHµ+3&¶PL[ZKLFKVXSSOHPHQWRUUHSODFHWKH3RUWODQGFHPHQW FI6HFWLRQ 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV

 
)LJXUH ,QYHUVH FDUERQDWLRQ UHVLVWDQFH µ5&2í¶  FKORULGH PLJUDWLRQ FRHIIL )LJXUH ,QYHUVH FDUERQDWLRQ UHVLVWDQFH µ5&2í¶  FKORULGH PLJUDWLRQ FRHIIL
FLHQW µ'&O¶ HOHFWURO\WH UHVLVWDQFH µ5ȍ¶ DQG PHDQ FRPSUHVVLYH FXEH FLHQW µ'&O¶ HOHFWURO\WH UHVLVWDQFH µ5ȍ¶ DQG PHDQ FRPSUHVVLYH FXEH
VWUHQJWK µIFPFXEH¶  IRU GLIIHUHQW µZF¶ UDWLRV RI 3RUWODQG FHPHQW FRQ VWUHQJWK µIFPFXEH¶  IRU GLIIHUHQW µZF¶ UDWLRV RI 3RUWODQG FHPHQW FRQ
FUHWH µ&(0 ,¶  3RUWODQG IO\DVK FHPHQW FRQFUHWH µ&(0 ,  6)$¶  FUHWH µ&(0 ,¶  3RUWODQG IO\DVK FHPHQW FRQFUHWH µ&(0 ,  6)$¶ 
DQG EODVWIXUQDFH FRQFUHWH &(0 ,,,  6XPPDU\ RI GDWD DQG ILJXUHV DQG EODVWIXUQDFH FRQFUHWH &(0 ,,,  6XPPDU\ RI GDWD DQG ILJXUHV
SURYLGHGLQ>*HKOHQ@FI>'6(1@IRUFHPHQWW\SHV SURYLGHGLQ>*HKOHQ@FI>'6(1@IRUFHPHQWW\SHV
DQG >*HKOHQ @ IRU WKH FRQFUHWH FRPSRVLWLRQV DQG FXULQJ FRQGL DQG >*HKOHQ @ IRU WKH FRQFUHWH FRPSRVLWLRQV DQG FXULQJ FRQGL
WLRQV WLRQV
)LJXUHVKRZVWKHLQIOXHQFHRIERWKWKHµZF¶DQGWKHFHPHQWW\SH ZLWKRUZLWKRXW )LJXUHVKRZVWKHLQIOXHQFHRIERWKWKHµZF¶DQGWKHFHPHQWW\SH ZLWKRUZLWKRXW
PLQHUDO DGGLWLRQV  RQ WKH FDUERQDWLRQ UHVLVWDQFH µ5&2¶ H[SUHVVHG DV µ5&2í¶  WKH PLQHUDO DGGLWLRQV  RQ WKH FDUERQDWLRQ UHVLVWDQFH µ5&2¶ H[SUHVVHG DV µ5&2í¶  WKH
FKORULGHPLJUDWLRQFRHIILFLHQWµ'&O¶WKHHOHFWURO\WHUHVLVWDQFHµ5ȍ¶DQGRQWKHPHDQ FKORULGHPLJUDWLRQFRHIILFLHQWµ'&O¶WKHHOHFWURO\WHUHVLVWDQFHµ5ȍ¶DQGRQWKHPHDQ
FRPSUHVVLYHFXEHVWUHQJWK µIFPFXEH¶ 7KHLQIOXHQFHRIWKHµZF¶LVLQJRRGDJUHHPHQW FRPSUHVVLYHFXEHVWUHQJWK µIFPFXEH¶ 7KHLQIOXHQFHRIWKHµZF¶LVLQJRRGDJUHHPHQW
ZLWK WKH WKHRU\ GHVFULEHG IRU WKH FRPSUHVVLYH VWUHQJWK LQJUHVV DQG LRQ PRELOLW\ ZLWK WKH WKHRU\ GHVFULEHG IRU WKH FRPSUHVVLYH VWUHQJWK LQJUHVV DQG LRQ PRELOLW\
WKURXJKRXW6HFWLRQ)RULQVWDQFHDGHFUHPHQWLQµZF¶LQFUHDVHVWKHFRPSUHVVLYH WKURXJKRXW6HFWLRQ)RULQVWDQFHDGHFUHPHQWLQµZF¶LQFUHDVHVWKHFRPSUHVVLYH
VWUHQJWKGHFUHDVHVSHUPHDELOLW\ DQGWKHGLIIXVLRQRI FKORULGH LRQVDQG&2DQGLQ VWUHQJWKGHFUHDVHVSHUPHDELOLW\ DQGWKHGLIIXVLRQRI FKORULGH LRQVDQG&2DQGLQ
FUHDVHVWKHRYHUDOOHOHFWURO\WHUHVLVWDQFH,QFUHDVLQJHOHFWURO\WHUHVLVWDQFHODUJHO\OLP FUHDVHVWKHRYHUDOOHOHFWURO\WHUHVLVWDQFH,QFUHDVLQJHOHFWURO\WHUHVLVWDQFHODUJHO\OLP
LWVWKHIRUPDWLRQRIPDFURFHOOV FI6HFWLRQ DQGWKHGLIIXVLRQRIGLVVROYHGFRUUR LWVWKHIRUPDWLRQRIPDFURFHOOV FI6HFWLRQ DQGWKHGLIIXVLRQRIGLVVROYHGFRUUR
VLRQ SURGXFWV FI 6HFWLRQ   LV KDPSHUHG DV ZHOO ZKLFK ZDV H[SHULPHQWDOO\ VLRQ SURGXFWV FI 6HFWLRQ   LV KDPSHUHG DV ZHOO ZKLFK ZDV H[SHULPHQWDOO\
FRQILUPHG E\ HJ >+DQVVRQ HWDO @ )RU D GHWDLOHG GLVFXVVLRQ RQ WKH GDWD SUR FRQILUPHG E\ HJ >+DQVVRQ HWDO @ )RU D GHWDLOHG GLVFXVVLRQ RQ WKH GDWD SUR
YLGHGLQ)LJXUH LQSDUWLFXODUZLWKUHJDUGWRWKHLQIOXHQFHRIWKHGLIIHUHQWFHPHQW YLGHGLQ)LJXUH LQSDUWLFXODUZLWKUHJDUGWRWKHLQIOXHQFHRIWKHGLIIHUHQWFHPHQW
W\SHV UHIHUHQFHLVPDGHWR>*HKOHQ@ W\SHV UHIHUHQFHLVPDGHWR>*HKOHQ@
)URPWKHLQIRUPDWLRQVXPPDULVHGLQ)LJXUHLWFDQEHFRQFOXGHGWKDWµ+3&¶FRQ )URPWKHLQIRUPDWLRQVXPPDULVHGLQ)LJXUHLWFDQEHFRQFOXGHGWKDWµ+3&¶FRQ
WUROV WKH HVVHQWLDO SDUDPHWHUV WKDW FRQWULEXWH WR FRUURVLRQ LQLWLDWLRQ DQG SURSDJDWLRQ WUROV WKH HVVHQWLDO SDUDPHWHUV WKDW FRQWULEXWH WR FRUURVLRQ LQLWLDWLRQ DQG SURSDJDWLRQ
GLVFXVVHG WKURXJKRXW 6HFWLRQ  DQG &KDSWHU  +RZHYHU µ+3&¶ PD\ DOVR KDYH D GLVFXVVHG WKURXJKRXW 6HFWLRQ  DQG &KDSWHU  +RZHYHU µ+3&¶ PD\ DOVR KDYH D
QXPEHU RI OHVV QRWLFHG DGYHUVH HIIHFWV FRQFHUQLQJ WKH FRUURVLRQ SURWHFWLRQ RI UHLQ QXPEHU RI OHVV QRWLFHG DGYHUVH HIIHFWV FRQFHUQLQJ WKH FRUURVLRQ SURWHFWLRQ RI UHLQ
IRUFHPHQW+LJKDPRXQWVRIPLQHUDODGGLWLRQVPD\OHDGWRORZHUDONDOLQLW\RIWKHSRUH IRUFHPHQW+LJKDPRXQWVRIPLQHUDODGGLWLRQVPD\OHDGWRORZHUDONDOLQLW\RIWKHSRUH
VROXWLRQ WKDQ IRU 3RUWODQG FHPHQWV ZKLFK UHGXFHV WKH EXIIHU FDSDFLW\ WR UHVLVW FDU VROXWLRQ WKDQ IRU 3RUWODQG FHPHQWV ZKLFK UHGXFHV WKH EXIIHU FDSDFLW\ WR UHVLVW FDU
ERQDWLRQ FI6HFWLRQ DQGWKHFKORULGHWKUHVKROG FI6HFWLRQ >5RVWDP ERQDWLRQ FI6HFWLRQ DQGWKHFKORULGHWKUHVKROG FI6HFWLRQ >5RVWDP
@:KLOHWKHLQIOXHQFHRQWKHFKORULGHWKUHVKROGLVQRWUHSUHVHQWHGLQ)LJXUH @:KLOHWKHLQIOXHQFHRQWKHFKORULGHWKUHVKROGLVQRWUHSUHVHQWHGLQ)LJXUH
WKHGHFUHDVHLQFDUERQDWLRQUHVLVWDQFHRI&(0,,,PL[HVFDQEHREVHUYHG WKHGHFUHDVHLQFDUERQDWLRQUHVLVWDQFHRI&(0,,,PL[HVFDQEHREVHUYHG

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

3URSHUO\ SURGXFHG SODFHG DQG FXUHG µ+3&¶ FDQ SURYLGH EHQHILWV IURP D FRUURVLRQ 3URSHUO\ SURGXFHG SODFHG DQG FXUHG µ+3&¶ FDQ SURYLGH EHQHILWV IURP D FRUURVLRQ
SURWHFWLRQ SHUVSHFWLYH <HW µ+3&¶ LV VHQVLWLYH WRZDUGV WKH DFWXDO KDQGOLQJ GXULQJ SURWHFWLRQ SHUVSHFWLYH <HW µ+3&¶ LV VHQVLWLYH WRZDUGV WKH DFWXDO KDQGOLQJ GXULQJ
SURGXFWLRQDQGH[HFXWLRQLHWKHPL[LQJWUDQVSRUWSODFLQJFRPSDFWLRQDQGFXULQJ SURGXFWLRQDQGH[HFXWLRQLHWKHPL[LQJWUDQVSRUWSODFLQJFRPSDFWLRQDQGFXULQJ
SURFHVVHV VHW KLJK GHPDQGV RQ WKH FRPSHWHQFH DQG H[SHULHQFH RI WKH ZRUNIRUFH SURFHVVHV VHW KLJK GHPDQGV RQ WKH FRPSHWHQFH DQG H[SHULHQFH RI WKH ZRUNIRUFH
>5RVWDP@(VSHFLDOO\WKHULVNRIFUDFNLQJDWHDUO\DJHGXHWRSODVWLFVKULQNDJH >5RVWDP@(VSHFLDOO\WKHULVNRIFUDFNLQJDWHDUO\DJHGXHWRSODVWLFVKULQNDJH
DQGWRWKHFRPELQDWLRQRIWKHUPDODQGDXWRJHQHRXVGHIRUPDWLRQ FI6HFWLRQ  DQGWRWKHFRPELQDWLRQRIWKHUPDODQGDXWRJHQHRXVGHIRUPDWLRQ FI6HFWLRQ 
LVPXFKKLJKHUIRUµ+3&¶WKDQIRURUGLQDU\FRQFUHWH>5RVWDP9DO 6WHZDUW LVPXFKKLJKHUIRUµ+3&¶WKDQIRURUGLQDU\FRQFUHWH>5RVWDP9DO 6WHZDUW
@ (DUO\DJH FUDFNLQJ LV RI SDUWLFXODU FRQFHUQ VLQFH WKH RULJLQDO EHQHILWV RI @ (DUO\DJH FUDFNLQJ LV RI SDUWLFXODU FRQFHUQ VLQFH WKH RULJLQDO EHQHILWV RI
µ+3&¶FDQEHFRPSURPLVHG,QUHODWLRQWRWKLVWKHGLVFXVVLRQFRQFHUQLQJWKHSRVVLELO µ+3&¶FDQEHFRPSURPLVHG,QUHODWLRQWRWKLVWKHGLVFXVVLRQFRQFHUQLQJWKHSRVVLELO
LW\ RI PDFURFHOO IRUPDWLRQ LQ WKH YLFLQLW\ RI WKH FUDFN FI 6HFWLRQ   FDQ EH LW\ RI PDFURFHOO IRUPDWLRQ LQ WKH YLFLQLW\ RI WKH FUDFN FI 6HFWLRQ   FDQ EH
UHOHYDQW UHOHYDQW
)RUµ+3&¶DVDFRQFUHWHFRXQWHUPHDVXUHZHFRQVLGHUWKHWKHUPRG\QDPLFLQIOXHQFHRI )RUµ+3&¶DVDFRQFUHWHFRXQWHUPHDVXUHZHFRQVLGHUWKHWKHUPRG\QDPLFLQIOXHQFHRI
PLQHUDODGGLWLRQVDQGFKHPLFDODGPL[WXUHRQLURQWREHPRUHLPSRUWDQWWKDQHJWKH PLQHUDODGGLWLRQVDQGFKHPLFDODGPL[WXUHRQLURQWREHPRUHLPSRUWDQWWKDQHJWKH
LQIOXHQFHRIWKHGHFUHDVHLQSHUPHDELOLW\RQµ(FRUU¶)URPDFRUURVLRQSURWHFWLRQSHU LQIOXHQFHRIWKHGHFUHDVHLQSHUPHDELOLW\RQµ(FRUU¶)URPDFRUURVLRQSURWHFWLRQSHU
VSHFWLYH WKH EHQHILWV RI µ+3&¶ DUH UDWKHU NLQHWLF WKDQ WKHUPRG\QDPLF DOWKRXJK WKH VSHFWLYH WKH EHQHILWV RI µ+3&¶ DUH UDWKHU NLQHWLF WKDQ WKHUPRG\QDPLF DOWKRXJK WKH
HIIHFW RI HJ UHGXFHG µ(FRUU¶ FDQ EH DVVHVVHG LQ WKH )H+2 µ6(3'¶ 7KH HIIHFW RI HIIHFW RI HJ UHGXFHG µ(FRUU¶ FDQ EH DVVHVVHG LQ WKH )H+2 µ6(3'¶ 7KH HIIHFW RI
PLQHUDODGGLWLRQVDQGFKHPLFDODGPL[WXUHVFRXOGEHVWXGLHGE\HVWDEOLVKPHQWRIDS PLQHUDODGGLWLRQVDQGFKHPLFDODGPL[WXUHVFRXOGEHVWXGLHGE\HVWDEOLVKPHQWRIDS
SURSULDWHµ0(3'V¶EDVHGRQWKHPHWKRGVGHVFULEHGLQ6HFWLRQ+RZHYHUZHSHU SURSULDWHµ0(3'V¶EDVHGRQWKHPHWKRGVGHVFULEHGLQ6HFWLRQ+RZHYHUZHSHU
IRUPHG QHLWKHU WKHRUHWLFDO QRU H[SHULPHQWDO LQYHVWLJDWLRQV RQ PLQHUDO DGGLWLRQV DQG IRUPHG QHLWKHU WKHRUHWLFDO QRU H[SHULPHQWDO LQYHVWLJDWLRQV RQ PLQHUDO DGGLWLRQV DQG
FKHPLFDODGPL[WXUHVVLQFHWKHVHDVSHFWVDUHPDUJLQDOIRUWKHSXUSRVHVRIWKLVWKHVLV FKHPLFDODGPL[WXUHVVLQFHWKHVHDVSHFWVDUHPDUJLQDOIRUWKHSXUSRVHVRIWKLVWKHVLV

 3RVW&DVWLQJ'HQVLILFDWLRQ7HFKQLTXHV  3RVW&DVWLQJ'HQVLILFDWLRQ7HFKQLTXHV


,Q >1HYLOOH @ YDULRXV RSWLRQV IRU SRVW FDVWLQJ GHQVLILFDWLRQ HJ WUHDWPHQW ZLWK ,Q >1HYLOOH @ YDULRXV RSWLRQV IRU SRVW FDVWLQJ GHQVLILFDWLRQ HJ WUHDWPHQW ZLWK
VLOLFRQ WHWUDIOXRULGH JDV GLOXWHG ZDWHUJODVV ZDVK RU PDJQHVLXP IOXRURVLOLFDWH DUH VLOLFRQ WHWUDIOXRULGH JDV GLOXWHG ZDWHUJODVV ZDVK RU PDJQHVLXP IOXRURVLOLFDWH DUH
PHQWLRQHG 7KHVH WHFKQLTXHV WKDW SULQFLSDOO\ DLP DW LPSURYLQJ WKH VDPH FRQFUHWH PHQWLRQHG 7KHVH WHFKQLTXHV WKDW SULQFLSDOO\ DLP DW LPSURYLQJ WKH VDPH FRQFUHWH
SURSHUWLHV DV µ+3&¶ DUH GLVFXVVHG LQ WKLV VHSDUDWH 6HFWLRQ VLQFH WKH GHQVLILFDWLRQ SURSHUWLHV DV µ+3&¶ DUH GLVFXVVHG LQ WKLV VHSDUDWH 6HFWLRQ VLQFH WKH GHQVLILFDWLRQ
WDNHVSODFHLQWKHHQWLUHFRQFUHWHEXON DOWKRXJKWKHUHDUHWHFKQLFDOOLPLWDWLRQVIRUWKH WDNHVSODFHLQWKHHQWLUHFRQFUHWHEXON DOWKRXJKWKHUHDUHWHFKQLFDOOLPLWDWLRQVIRUWKH
GHSWK RI SHQHWUDWLRQ  UDWKHU WKDQ DW RU FORVH WR WKH VXUIDFH DV HJ FRQFUHWH VXUIDFH GHSWK RI SHQHWUDWLRQ  UDWKHU WKDQ DW RU FORVH WR WKH VXUIDFH DV HJ FRQFUHWH VXUIDFH
SURWHFWLRQWUHDWPHQWVWKDWDUHEULHIO\GLVFXVVHGLQ6HFWLRQ SURWHFWLRQWUHDWPHQWVWKDWDUHEULHIO\GLVFXVVHGLQ6HFWLRQ
2QH SURSRVDO LV WR VXEMHFW WKH FRQFUHWH LQ D YDFXXP WR WKH DFWLRQ RI VLOLFRQ WHWUD 2QH SURSRVDO LV WR VXEMHFW WKH FRQFUHWH LQ D YDFXXP WR WKH DFWLRQ RI VLOLFRQ WHWUD
IOXRULGH 6L) JDV6L)UHDFWVZLWKWKHFDOFLXPK\GUR[LGHWRIRUPFDOFLXPIOXRULGH IOXRULGH 6L) JDV6L)UHDFWVZLWKWKHFDOFLXPK\GUR[LGHWRIRUPFDOFLXPIOXRULGH
&D) ZKLFKILOOVXSWKHHPSW\SRUHVLQWKHFRQFUHWHEXON7KLVWHFKQLTXHGDWHVEDFN &D) ZKLFKILOOVXSWKHHPSW\SRUHVLQWKHFRQFUHWHEXON7KLVWHFKQLTXHGDWHVEDFN
WRWKHVDQGZDVRULJLQDOO\GHYHORSHGWRLPSURYHWKHDFLGUHVLVWDQFHRIFRQFUHWH WRWKHVDQGZDVRULJLQDOO\GHYHORSHGWRLPSURYHWKHDFLGUHVLVWDQFHRIFRQFUHWH
VRFDOOHG2FUDWFRQFUHWH >:LWWHNLQGW@7KHRXWFRPHZLWKUHJDUGWRDFLGUHVLV VRFDOOHG2FUDWFRQFUHWH >:LWWHNLQGW@7KHRXWFRPHZLWKUHJDUGWRDFLGUHVLV
WDQFHVHHPVWREHSURPLVLQJDQGVLQFHWKLVWHFKQLTXHLQYROYHVGHQVLILFDWLRQDFRUUR WDQFHVHHPVWREHSURPLVLQJDQGVLQFHWKLVWHFKQLTXHLQYROYHVGHQVLILFDWLRQDFRUUR
VLRQSURWHFWLRQLPSURYHPHQWVLPLODUWRµ+3&¶FDQEHH[SHFWHG&D 2+ FDQDOVREH VLRQSURWHFWLRQLPSURYHPHQWVLPLODUWRµ+3&¶FDQEHH[SHFWHG&D 2+ FDQDOVREH
IL[HGE\WUHDWPHQWZLWKGLOXWHGZDWHUJODVV VRGLXPVLOLFDWH ZKHUHFDOFLXPVLOLFDWHV IL[HGE\WUHDWPHQWZLWKGLOXWHGZDWHUJODVV VRGLXPVLOLFDWH ZKHUHFDOFLXPVLOLFDWHV
DUHIRUPHGWRILOOWKHSRUHV7UHDWPHQWZLWKPDJQHVLXPIOXRVLOLFDWHLVDOVRFRQVLGHUHG DUHIRUPHGWRILOOWKHSRUHV7UHDWPHQWZLWKPDJQHVLXPIOXRVLOLFDWHLVDOVRFRQVLGHUHG
DV DQ RSWLRQ DLPLQJ DW IRUPDWLRQ RI FROORLGDO VLOLFRIOXRULF JHO WR ILOO WKH SRUHV DV DQ RSWLRQ DLPLQJ DW IRUPDWLRQ RI FROORLGDO VLOLFRIOXRULF JHO WR ILOO WKH SRUHV
>1HYLOOH@ >1HYLOOH@

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV

$SSOLFDWLRQRIWKHVHWUHDWPHQWVLVYHU\PDUJLQDODQGZHUHJDUGLWWREHOLPLWHGWRHJ $SSOLFDWLRQRIWKHVHWUHDWPHQWVLVYHU\PDUJLQDODQGZHUHJDUGLWWREHOLPLWHGWRHJ
WKHSUHFDVWLQJLQGXVWU\+RZHYHUWKHVHGHQVLILFDWLRQVWHFKQLTXHVZHUHUHOHYDQWIRUXV WKHSUHFDVWLQJLQGXVWU\+RZHYHUWKHVHGHQVLILFDWLRQVWHFKQLTXHVZHUHUHOHYDQWIRUXV
VLQFHWKH\UHODWHWRPHFKDQLVPVWKDWZHUHLPSOHPHQWHGLQWKHSURSRVHGQHZFRXQWHU VLQFHWKH\UHODWHWRPHFKDQLVPVWKDWZHUHLPSOHPHQWHGLQWKHSURSRVHGQHZFRXQWHU
PHDVXUHV &KDSWHU 7KXVZLWKUHJDUGWRWKHDSSOLFDWLRQRIWKHUPRG\QDPLFVLQWKLV PHDVXUHV &KDSWHU 7KXVZLWKUHJDUGWRWKHDSSOLFDWLRQRIWKHUPRG\QDPLFVLQWKLV
DUHDLWFDQEHVWDWHGWKHVDPHDVLQ6HFWLRQLHIRFXVZDVVHWRQWKHPDWHULDOV DUHDLWFDQEHVWDWHGWKHVDPHDVLQ6HFWLRQLHIRFXVZDVVHWRQWKHPDWHULDOV
DQGWKHFKHPLFDOSURFHVVHVUDWKHUWKDQRQWKHWKHUPRG\QDPLFHIIHFWRIWKHGHQVLILFD DQGWKHFKHPLFDOSURFHVVHVUDWKHUWKDQRQWKHWKHUPRG\QDPLFHIIHFWRIWKHGHQVLILFD
WLRQLWVHOI&RQWUDU\WRµ+3&¶DGGLWLRQVKRZHYHUWKHVXEVWDQFHVDQGDVVRFLDWHGIRU WLRQLWVHOI&RQWUDU\WRµ+3&¶DGGLWLRQVKRZHYHUWKHVXEVWDQFHVDQGDVVRFLDWHGIRU
PDWLRQ RI FRPSRXQGV LQYROYHG LQ WKH GHVFULEHG SRUHEORFNLQJ PHFKDQLVPV KDYH PDWLRQ RI FRPSRXQGV LQYROYHG LQ WKH GHVFULEHG SRUHEORFNLQJ PHFKDQLVPV KDYH
SOD\HGDPDMRUUROHLQRXUWKHUPRG\QDPLFFRQVLGHUDWLRQV SOD\HGDPDMRUUROHLQRXUWKHUPRG\QDPLFFRQVLGHUDWLRQV

 &RQFUHWH6XUIDFH3URWHFWLRQ  &RQFUHWH6XUIDFH3URWHFWLRQ


,QFRQWUDVWWRµ+3&¶ FI6HFWLRQ DQGGHQVLILFDWLRQ FI6HFWLRQ ZKLFK ,QFRQWUDVWWRµ+3&¶ FI6HFWLRQ DQGGHQVLILFDWLRQ FI6HFWLRQ ZKLFK
DLP DW UHGXFLQJ WKH SHUPHDELOLW\ RI WKH FRQFUHWH EXON WKH IRFXV LQ FRQFUHWH VXUIDFH DLP DW UHGXFLQJ WKH SHUPHDELOLW\ RI WKH FRQFUHWH EXON WKH IRFXV LQ FRQFUHWH VXUIDFH
SURWHFWLRQLVVHWRQWKHH[WHUQDOIDFHRIWKHFRQFUHWHFRYHU:HFRQVLGHUWKHEHQHILFLDO SURWHFWLRQLVVHWRQWKHH[WHUQDOIDFHRIWKHFRQFUHWHFRYHU:HFRQVLGHUWKHEHQHILFLDO
DFWLRQRIVXUIDFHSURWHFWLRQWREHUHODWHGWRSURORQJLQJWKHLQLWLDWLRQSKDVHRQO\$IWHU DFWLRQRIVXUIDFHSURWHFWLRQWREHUHODWHGWRSURORQJLQJWKHLQLWLDWLRQSKDVHRQO\$IWHU
FRUURVLRQ LQLWLDWLRQ RQO\ WKRVH WUHDWPHQWV WKDW HIIHFWLYHO\ LPSHGH WKH SHQHWUDWLRQ RI FRUURVLRQ LQLWLDWLRQ RQO\ WKRVH WUHDWPHQWV WKDW HIIHFWLYHO\ LPSHGH WKH SHQHWUDWLRQ RI
+2 DQG 2 UHGXFH WKH FRUURVLRQ UDWH 7KLV PD\ EH SDUWO\ HIILFLHQW IRU FDUERQDWLRQ +2 DQG 2 UHGXFH WKH FRUURVLRQ UDWH 7KLV PD\ EH SDUWO\ HIILFLHQW IRU FDUERQDWLRQ
LQLWLDWHGFRUURVLRQ FI6HFWLRQ EXWZLWKUHJDUGWRWKHPHFKDQLVPVGHVFULEHG LQLWLDWHGFRUURVLRQ FI6HFWLRQ EXWZLWKUHJDUGWRWKHPHFKDQLVPVGHVFULEHG
IRUFKORULGHLQGXFHGFRUURVLRQ FI6HFWLRQ ZHGRQRWFRQVLGHUVXUIDFHSURWHF IRUFKORULGHLQGXFHGFRUURVLRQ FI6HFWLRQ ZHGRQRWFRQVLGHUVXUIDFHSURWHF
WLRQDVDQRSWLRQIRUUHSDLURIGHWHULRUDWLQJVWUXFWXUHVLHDVDFRXQWHUPHDVXUHIRUH[ WLRQDVDQRSWLRQIRUUHSDLURIGHWHULRUDWLQJVWUXFWXUHVLHDVDFRXQWHUPHDVXUHIRUH[
LVWLQJVWUXFWXUHV LVWLQJVWUXFWXUHV
3DUW  RI (1  GHDOV H[FOXVLYHO\ ZLWK VXUIDFH SURWHFWLRQ V\VWHPV IRU FRQFUHWH 3DUW  RI (1  GHDOV H[FOXVLYHO\ ZLWK VXUIDFH SURWHFWLRQ V\VWHPV IRU FRQFUHWH
>'6(1@0RUHRYHUH[WHQVLYHLQIRUPDWLRQRQVXUIDFHFRDWLQJVLVJLYHQ >'6(1@0RUHRYHUH[WHQVLYHLQIRUPDWLRQRQVXUIDFHFRDWLQJVLVJLYHQ
LQ WKH ³*XLGH WR 'XUDEOH &RQFUHWH´ >$&, 5 @ DV ZHOO DVLQ WKH H[WHQVLYH LQ WKH ³*XLGH WR 'XUDEOH &RQFUHWH´ >$&, 5 @ DV ZHOO DVLQ WKH H[WHQVLYH
JXLGHOLQHVIRUVXUIDFHSURWHFWLRQV\VWHPVSXEOLVKHGE\$&,>$&,5@DQG JXLGHOLQHVIRUVXUIDFHSURWHFWLRQV\VWHPVSXEOLVKHGE\$&,>$&,5@DQG
&6>&6@%HVLGHVSURWHFWLQJWKHFRQFUHWHLWVHOIDJDLQVWFKHPLFDODWWDFN FI6HF &6>&6@%HVLGHVSURWHFWLQJWKHFRQFUHWHLWVHOIDJDLQVWFKHPLFDODWWDFN FI6HF
WLRQ DQGGHFRUDWLYHDSSOLFDWLRQVFRQFUHWHVXUIDFHWUHDWPHQWVKDYHODUJHO\IRFXVHG WLRQ DQGGHFRUDWLYHDSSOLFDWLRQVFRQFUHWHVXUIDFHWUHDWPHQWVKDYHODUJHO\IRFXVHG
RQSUHYHQWLQJUHLQIRUFHPHQWFRUURVLRQDQGWKHDVVRFLDWHGGDPDJHLQVSHFLDOHQYLURQ RQSUHYHQWLQJUHLQIRUFHPHQWFRUURVLRQDQGWKHDVVRFLDWHGGDPDJHLQVSHFLDOHQYLURQ
PHQWV HVSHFLDOO\ IRU FDU SDUNV >$&, 5  $&, 5  5DXSDFK  PHQWV HVSHFLDOO\ IRU FDU SDUNV >$&, 5  $&, 5  5DXSDFK 
:ROII@ :ROII@
$ FRQYHQLHQW ZD\ RI FODVVLI\LQJ WKH H[WHQVLYH QXPEHU RI VXUIDFH WUHDWPHQW W\SHV LV $ FRQYHQLHQW ZD\ RI FODVVLI\LQJ WKH H[WHQVLYH QXPEHU RI VXUIDFH WUHDWPHQW W\SHV LV
EDVHGRQWKHSURWHFWLRQRUEHQHILWVDFKLHYHGE\WKHWUHDWPHQW>0D\VHWDO@VHH EDVHGRQWKHSURWHFWLRQRUEHQHILWVDFKLHYHGE\WKHWUHDWPHQW>0D\VHWDO@VHH
)LJXUH )LJXUH

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

 
)LJXUH &ODVVHV RI VXUIDFH WUHDWPHQW >$@ &RQWLQXRXV ILOP DFKLHYHG E\ FRDW )LJXUH &ODVVHV RI VXUIDFH WUHDWPHQW >$@ &RQWLQXRXV ILOP DFKLHYHG E\ FRDW
LQJVDQGVHDOHUV>%@+\GURSKRELFOD\HUDFKLHYHGE\SRUHOLQHUV>&@ LQJVDQGVHDOHUV>%@+\GURSKRELFOD\HUDFKLHYHGE\SRUHOLQHUV>&@
5HDFWLRQ SURGXFWV EORFNLQJ SRUHV DFKLHYHG E\ SRUHEORFNHUV >'@ 5HDFWLRQ SURGXFWV EORFNLQJ SRUHV DFKLHYHG E\ SRUHEORFNHUV >'@
7KLFN GHQVH VXUIDFH OD\HU DFKLHYHG E\ FHPHQWLWLRXV FRDWLQJV $IWHU 7KLFN GHQVH VXUIDFH OD\HU DFKLHYHG E\ FHPHQWLWLRXV FRDWLQJV $IWHU
>0D\VHWDO@ >0D\VHWDO@
7KHVHIRXUPDLQFODVVHVRIVXUIDFHWUHDWPHQWDUHGHVFULEHGDQGEULHIO\HYDOXDWHGLQWKH 7KHVHIRXUPDLQFODVVHVRIVXUIDFHWUHDWPHQWDUHGHVFULEHGDQGEULHIO\HYDOXDWHGLQWKH
IROORZLQJ IROORZLQJ
‡ &RQWLQXRXVILOPDFKLHYHGE\FRDWLQJVDQGVHDOHUVVHH)LJXUH>$@ ‡ &RQWLQXRXVILOPDFKLHYHGE\FRDWLQJVDQGVHDOHUVVHH)LJXUH>$@
&RDWLQJVDQGVHDOHUVUHO\XSRQWKHIRUPDWLRQRIDSLQKROHIUHHILOPRIILQLWHWKLFN &RDWLQJVDQGVHDOHUVUHO\XSRQWKHIRUPDWLRQRIDSLQKROHIUHHILOPRIILQLWHWKLFN
QHVV RYHU WKH FRQFUHWH VXUIDFH WKDW DFWV DV D EDUULHU WR WKH SDVVDJH RI ZDWHU DQG QHVV RYHU WKH FRQFUHWH VXUIDFH WKDW DFWV DV D EDUULHU WR WKH SDVVDJH RI ZDWHU DQG
R[\JHQ RU WKH GLIIXVLRQ RI FDUERQ GLR[LGH DQG FKORULGH LRQV 7KH PDWHULDOV GH R[\JHQ RU WKH GLIIXVLRQ RI FDUERQ GLR[LGH DQG FKORULGH LRQV 7KH PDWHULDOV GH
VFULEHGDVVHDOHUVDUHVXSSRVHGWRSHQHWUDWHLQWRWKHFRQFUHWHSRUHWRDFHUWDLQH[ VFULEHGDVVHDOHUVDUHVXSSRVHGWRSHQHWUDWHLQWRWKHFRQFUHWHSRUHWRDFHUWDLQH[
WHQW&RDWLQJVQRUPDOO\KDYHDGU\ILOPWKLFNQHVVRI—PDSSOLHGLQWZRRU WHQW&RDWLQJVQRUPDOO\KDYHDGU\ILOPWKLFNQHVVRI—PDSSOLHGLQWZRRU
PRUHOD\HUVZKLOHWKLFNHUµKLJKEXLOG¶FRDWLQJVDUHDOVRXVHG6HDOHUVDQGFRDWLQJV PRUHOD\HUVZKLOHWKLFNHUµKLJKEXLOG¶FRDWLQJVDUHDOVRXVHG6HDOHUVDQGFRDWLQJV
DUHFRPSRVHGRIDQXPEHURIFRQVWLWXHQWVWKDWDUHQRWGHVFULEHGLQGHWDLOKHUHDQG DUHFRPSRVHGRIDQXPEHURIFRQVWLWXHQWVWKDWDUHQRWGHVFULEHGLQGHWDLOKHUHDQG
UHIHUHQFHLVPDGHWRHJWKHWH[WERRNVOLVWHGLQ6HFWLRQ>0D\VHWDO@ UHIHUHQFHLVPDGHWRHJWKHWH[WERRNVOLVWHGLQ6HFWLRQ>0D\VHWDO@
7R HIILFLHQWO\ LPSHGH LQJUHVV VHDOHUV DQG FRDWLQJV PXVW REYLRXVO\ KDYH D ORZ 7R HIILFLHQWO\ LPSHGH LQJUHVV VHDOHUV DQG FRDWLQJV PXVW REYLRXVO\ KDYH D ORZ
SHUPHDELOLW\DQGUHWDLQLWXQGHUYDULRXVGHJUDGLQJHIIHFWVIURPWKHLPPHGLDWHHQ SHUPHDELOLW\DQGUHWDLQLWXQGHUYDULRXVGHJUDGLQJHIIHFWVIURPWKHLPPHGLDWHHQ
YLURQPHQW DV ZHOO DV IURP HJ WHPSHUDWXUH HIIHFW DQG 89 OLJKW 7KH PDWHULDO YLURQPHQW DV ZHOO DV IURP HJ WHPSHUDWXUH HIIHFW DQG 89 OLJKW 7KH PDWHULDO
SURSHUWLHVRIVHDOHUVDQGFRDWLQJV JHQHUDOO\GLIIHUODUJHO\ IURPWKRVHRIWKHFRQ SURSHUWLHVRIVHDOHUVDQGFRDWLQJV JHQHUDOO\GLIIHUODUJHO\ IURPWKRVHRIWKHFRQ
FUHWHHJFRQFHUQLQJWKHPRGXOXVRIHODVWLFLW\DQGH[SDQVLRQGXHWRWHPSHUDWXUH FUHWHHJFRQFHUQLQJWKHPRGXOXVRIHODVWLFLW\DQGH[SDQVLRQGXHWRWHPSHUDWXUH
FKDQJHVDVZHOODVZHWWLQJDQGGU\LQJ7KXVUHVXOWLQJVWUHVVHVLQWKHFRDWLQJVPD\ FKDQJHVDVZHOODVZHWWLQJDQGGU\LQJ7KXVUHVXOWLQJVWUHVVHVLQWKHFRDWLQJVPD\
VORZO\GHJUDGHWKHLUEDUULHUSURSHUWLHVVRWKHORQJWLPHGXUDELOLW\RIPDQ\VHDOHUV VORZO\GHJUDGHWKHLUEDUULHUSURSHUWLHVVRWKHORQJWLPHGXUDELOLW\RIPDQ\VHDOHUV
DQGFRDWLQJVPD\EHTXHVWLRQHG>ILED5RVWDP%HUWROLQLHWDO@ DQGFRDWLQJVPD\EHTXHVWLRQHG>ILED5RVWDP%HUWROLQLHWDO@
,Q WKLV UHVSHFW >'6(1  @ VSHFLILHV DUWLILFLDO ZHDWKHULQJ %HVLGHV ,Q WKLV UHVSHFW >'6(1  @ VSHFLILHV DUWLILFLDO ZHDWKHULQJ %HVLGHV
WKHVHFRQFHUQVUHODWLQJWRORQJWHUPGXUDELOLW\LWVKRXOGDOVREHQRWHGWKDWLQH[ WKHVHFRQFHUQVUHODWLQJWRORQJWHUPGXUDELOLW\LWVKRXOGDOVREHQRWHGWKDWLQH[
WUHPH FDVHV DQ LQVXIILFLHQW EDUULHU HIIHFW FDQ QHJDWLYHO\ LQIOXHQFH WKH FRQFUHWH WUHPH FDVHV DQ LQVXIILFLHQW EDUULHU HIIHFW FDQ QHJDWLYHO\ LQIOXHQFH WKH FRQFUHWH
SURSHUWLHV HJ LI GU\LQJ RXW RFFXUV DW HDUO\ DJHV FHPHQW K\GUDWLRQ LV KDPSHUHG SURSHUWLHV HJ LI GU\LQJ RXW RFFXUV DW HDUO\ DJHV FHPHQW K\GUDWLRQ LV KDPSHUHG
>&LJQDHWDO@$WWKHVDPHWLPHFRDWLQJV PXVWDOORZWKHSDVVDJHRIZDWHU >&LJQDHWDO@$WWKHVDPHWLPHFRDWLQJV PXVWDOORZWKHSDVVDJHRIZDWHU
YDSRXUWRDYRLGLQLWLDOGLVERQGLQJ>%HUWROLQLHWDO@ YDSRXUWRDYRLGLQLWLDOGLVERQGLQJ>%HUWROLQLHWDO@
‡ +\GURSKRELFOD\HUDFKLHYHGE\SRUHOLQHUVVHH)LJXUH>%@ ‡ +\GURSKRELFOD\HUDFKLHYHGE\SRUHOLQHUVVHH)LJXUH>%@
3RUHOLQLQJWUHDWPHQWVLQYROYHK\GURSKRELFPDWHULDOVZKLFKOLQHVXUIDFHSRUHVRI 3RUHOLQLQJWUHDWPHQWVLQYROYHK\GURSKRELFPDWHULDOVZKLFKOLQHVXUIDFHSRUHVRI
WKHFRQFUHWHDQGUHSHOPRLVWXUHE\WKHPHFKDQLVPLQGLFDWHGLQ)LJXUH>%@7KH WKHFRQFUHWHDQGUHSHOPRLVWXUHE\WKHPHFKDQLVPLQGLFDWHGLQ)LJXUH>%@7KH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV

PRVWLPSRUWDQWPDWHULDOVLQWKLVFODVVDUHEDVHGRQVLOLFRQHFRPSRXQGVZKLFKDUH PRVWLPSRUWDQWPDWHULDOVLQWKLVFODVVDUHEDVHGRQVLOLFRQHFRPSRXQGVZKLFKDUH
V\QWKHWLFFKHPLFDOVSURGXFHGE\WKHFKHPLFDOFRPELQDWLRQRILQRUJDQLFPDWHULDOV V\QWKHWLFFKHPLFDOVSURGXFHGE\WKHFKHPLFDOFRPELQDWLRQRILQRUJDQLFPDWHULDOV
FRQWDLQLQJVLOLFRQDQGR[\JHQZLWKK\GURFDUERQV>0D\VHWDO@ FRQWDLQLQJVLOLFRQDQGR[\JHQZLWKK\GURFDUERQV>0D\VHWDO@
+\GURSKRELFWUHDWPHQWVDUHRIWHQFRQVLGHUHGWREHHIIHFWLYHLQUHGXFLQJWKHSHQH +\GURSKRELFWUHDWPHQWVDUHRIWHQFRQVLGHUHGWREHHIIHFWLYHLQUHGXFLQJWKHSHQH
WUDWLRQRIZDWHUDQGFKORULGHLRQV>&LJQDHWDO@+RZHYHULWVHHPVWKDWWKH WUDWLRQRIZDWHUDQGFKORULGHLRQV>&LJQDHWDO@+RZHYHULWVHHPVWKDWWKH
H[SHULHQFHVYDU\IURPFRXQWU\WRFRXQWU\:KHUHDVLQVRPHFRXQWULHVWKHDSSOLFD H[SHULHQFHVYDU\IURPFRXQWU\WRFRXQWU\:KHUHDVLQVRPHFRXQWULHVWKHDSSOLFD
WLRQRIK\GURSKRELFWUHDWPHQWVLVPDQGDWRU\IRUEULGJHVH[SRVHGWRGHLFLQJVDOWV WLRQRIK\GURSKRELFWUHDWPHQWVLVPDQGDWRU\IRUEULGJHVH[SRVHGWRGHLFLQJVDOWV
RWKHUFRXQWULHVJHQHUDOO\RPLWWKHDSSOLFDWLRQRIVLODQHVHWFEHFDXVHWKHK\GUR RWKHUFRXQWULHVJHQHUDOO\RPLWWKHDSSOLFDWLRQRIVLODQHVHWFEHFDXVHWKHK\GUR
SKRELF HIIHFW LV FRQVLGHUHG WR YDQLVK DIWHU MXVW D IHZ PRQWKV RU \HDUV >5RVWDP SKRELF HIIHFW LV FRQVLGHUHG WR YDQLVK DIWHU MXVW D IHZ PRQWKV RU \HDUV >5RVWDP
@ @
‡ 5HDFWLRQSURGXFWVEORFNLQJSRUHVDFKLHYHGE\SRUHEORFNHUVVHH)LJXUH>&@ ‡ 5HDFWLRQSURGXFWVEORFNLQJSRUHVDFKLHYHGE\SRUHEORFNHUVVHH)LJXUH>&@
$VIRUGHQVLILFDWLRQEDVHGRQH[SRVXUHWRJDVHV FI6HFWLRQ WKHSURGXFWV $VIRUGHQVLILFDWLRQEDVHGRQH[SRVXUHWRJDVHV FI6HFWLRQ WKHSURGXFWV
EORFNLQJWKHSRUHVUHVXOWIURPWKHUHDFWLRQEHWZHHQDSHQHWUDQWDQGWKHDYDLODEOH EORFNLQJWKHSRUHVUHVXOWIURPWKHUHDFWLRQEHWZHHQDSHQHWUDQWDQGWKHDYDLODEOH
FDOFLXP K\GUR[LGH 7KH PRVW FRPPRQ SHQHWUDQWV DUH OLTXLG VLOLFDWHV DQG VLOL FDOFLXP K\GUR[LGH 7KH PRVW FRPPRQ SHQHWUDQWV DUH OLTXLG VLOLFDWHV DQG VLOL
FRIOXRULGHVZKLFKDUHWKRXJKWWROHDGWRWKHIRUPDWLRQRIDGGLWLRQDOµ&6+¶JHO FRIOXRULGHVZKLFKDUHWKRXJKWWROHDGWRWKHIRUPDWLRQRIDGGLWLRQDOµ&6+¶JHO
FI 6HFWLRQ   DQG RI LQVROXEOH FDOFLXP VLOLFRIOXRULGHV UHVSHFWLYHO\ >0D\V FI 6HFWLRQ   DQG RI LQVROXEOH FDOFLXP VLOLFRIOXRULGHV UHVSHFWLYHO\ >0D\V
HWDO@ HWDO@
$VPHQWLRQHGLQ6HFWLRQZHFRQVLGHUWKHSULQFLSOHRIEORFNLQJSRUHVE\ $VPHQWLRQHGLQ6HFWLRQZHFRQVLGHUWKHSULQFLSOHRIEORFNLQJSRUHVE\
UHDFWLRQ SURGXFHV WR EH D SRWHQW PHFKDQLVP LQ WHUPV RI FRUURVLRQ SURWHFWLRQ UHDFWLRQ SURGXFHV WR EH D SRWHQW PHFKDQLVP LQ WHUPV RI FRUURVLRQ SURWHFWLRQ
+RZHYHUSRUHEORFNLQJEDVHGRQH[SRVXUHWRJDVHVFDQQRWEHDSSOLHGLQVLWXDQG +RZHYHUSRUHEORFNLQJEDVHGRQH[SRVXUHWRJDVHVFDQQRWEHDSSOLHGLQVLWXDQG
ZH FRQVLGHU WKH FRQFHSW RI D OLTXLG SRUHEORFNHU DSSOLHG IURP WKH VXUIDFH WR EH ZH FRQVLGHU WKH FRQFHSW RI D OLTXLG SRUHEORFNHU DSSOLHG IURP WKH VXUIDFH WR EH
GRXEWIXOIRUWZRUHDVRQV)LUVWO\WKHSHQHWUDWLRQGHSWKRIWKHSRUHEORFNHUPD\EH GRXEWIXOIRUWZRUHDVRQV)LUVWO\WKHSHQHWUDWLRQGHSWKRIWKHSRUHEORFNHUPD\EH
LQVXIILFLHQWWREXLOGXSDEDUULHUWKDWSURYLGHVIRUORQJWHUPUHVLVWDQFH6HFRQGO\ LQVXIILFLHQWWREXLOGXSDEDUULHUWKDWSURYLGHVIRUORQJWHUPUHVLVWDQFH6HFRQGO\
WKH GHQVLILFDWLRQ GRHV QRW WDNH SODFH ZKHUH ZH FRQVLGHU LW WR EH PRVW HIILFLHQW WKH GHQVLILFDWLRQ GRHV QRW WDNH SODFH ZKHUH ZH FRQVLGHU LW WR EH PRVW HIILFLHQW
ZLWK UHJDUG WR FRUURVLRQ SURWHFWLRQ LH DW WKH FRQFUHWHVWHHO LQWHUIDFH 7KLV QR ZLWK UHJDUG WR FRUURVLRQ SURWHFWLRQ LH DW WKH FRQFUHWHVWHHO LQWHUIDFH 7KLV QR
WLRQLVRISDUWLFXODULPSRUWDQFHLQWKHGHYHORSPHQWRIWKHSURSRVHGQHZFRXQWHU WLRQLVRISDUWLFXODULPSRUWDQFHLQWKHGHYHORSPHQWRIWKHSURSRVHGQHZFRXQWHU
PHDVXUHV FI&KDSWHU  PHDVXUHV FI&KDSWHU 
‡ 7KLFNGHQVHVXUIDFHOD\HUDFKLHYHGE\FHPHQWLWLRXVFRDWLQJVVHH)LJXUH>'@ ‡ 7KLFNGHQVHVXUIDFHOD\HUDFKLHYHGE\FHPHQWLWLRXVFRDWLQJVVHH)LJXUH>'@
&HPHQWLWLRXV FRDWLQJV ZKLFK DUH JHQHUDOO\ DSSOLHG WR WKH H[LVWLQJ VXUIDFH E\ &HPHQWLWLRXV FRDWLQJV ZKLFK DUH JHQHUDOO\ DSSOLHG WR WKH H[LVWLQJ VXUIDFH E\
WURZHOOLQJRUVSUD\LQJDUHEDVHGRQWKHSULQFLSOHVGHVFULEHGLQ6HFWLRQDQGLQ WURZHOOLQJRUVSUD\LQJDUHEDVHGRQWKHSULQFLSOHVGHVFULEHGLQ6HFWLRQDQGLQ
VLPSOHWHUPVSURYLGHDQDGGLWLRQDOEDUULHUWRWKHH[LVWLQJFRQFUHWHFRYHU VLPSOHWHUPVSURYLGHDQDGGLWLRQDOEDUULHUWRWKHH[LVWLQJFRQFUHWHFRYHU

 ,QWHJUDO&RUURVLRQ,QKLELWRUV  ,QWHJUDO&RUURVLRQ,QKLELWRUV


&RUURVLRQLQKLELWRUVFDQEHDSSOLHGLQWZRGLIIHUHQWZD\VDVLQWHJUDORUDVGLIIXVLRQ &RUURVLRQLQKLELWRUVFDQEHDSSOLHGLQWZRGLIIHUHQWZD\VDVLQWHJUDORUDVGLIIXVLRQ
LQKLELWRUV &%'*  LQKLELWRUV &%'* 
 

 ,QWHJUDODQGGLIIXVLRQLQKLELWRUVDUHLQWKHOLWHUDWXUHDOVRUHIHUUHGWRDVFDVWLQRUDGPL[HGDQGPLJUDW  ,QWHJUDODQGGLIIXVLRQLQKLELWRUVDUHLQWKHOLWHUDWXUHDOVRUHIHUUHGWRDVFDVWLQRUDGPL[HGDQGPLJUDW
LQJLQKLELWRUVUHVSHFWLYHO\:KLOHZHDJUHHWRWKHSUHIL[HV³FDVWLQ´RU³DGPL[HG´ZHFRQVLGHUWKH LQJLQKLELWRUVUHVSHFWLYHO\:KLOHZHDJUHHWRWKHSUHIL[HV³FDVWLQ´RU³DGPL[HG´ZHFRQVLGHUWKH
SUHIL[³PLJUDWLRQ´WREHPLVOHDGLQJZLWKUHJDUGWRWKHDFWXDOGRPLQDWLQJWUDQVSRUWPHFKDQLVP FI SUHIL[³PLJUDWLRQ´WREHPLVOHDGLQJZLWKUHJDUGWRWKHDFWXDOGRPLQDWLQJWUDQVSRUWPHFKDQLVP FI
6HFWLRQ  6HFWLRQ 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

‡ ,QWHJUDOLQKLELWRUV ‡ ,QWHJUDOLQKLELWRUV
,QWHJUDOLQKLELWRUVDUHOLTXLGVRUVROLGVWKDWDUHEDWFKHGDQGPL[HGZLWKWKHRWKHU ,QWHJUDOLQKLELWRUVDUHOLTXLGVRUVROLGVWKDWDUHEDWFKHGDQGPL[HGZLWKWKHRWKHU
FRQFUHWHLQJUHGLHQWVDVDSUHYHQWLYHPHDVXUHIRUQHZFRQVWUXFWLRQVRUSDWFKUHSDLU FRQFUHWHLQJUHGLHQWVDVDSUHYHQWLYHPHDVXUHIRUQHZFRQVWUXFWLRQVRUSDWFKUHSDLU
PRUWDUV FI6HFWLRQ  PRUWDUV FI6HFWLRQ 
‡ 'LIIXVLRQLQKLELWRUV ‡ 'LIIXVLRQLQKLELWRUV
'LIIXVLRQ LQKLELWRUV DUH DSSOLHG WR H[LVWLQJ UHLQIRUFHG FRQFUHWH VWUXFWXUHV WKDW 'LIIXVLRQ LQKLELWRUV DUH DSSOLHG WR H[LVWLQJ UHLQIRUFHG FRQFUHWH VWUXFWXUHV WKDW
VKRZVLJQVRIUHLQIRUFHPHQWFRUURVLRQRUQHHGDGGLWLRQDOSURWHFWLRQWRLQKLELWIX VKRZVLJQVRIUHLQIRUFHPHQWFRUURVLRQRUQHHGDGGLWLRQDOSURWHFWLRQWRLQKLELWIX
WXUH FRUURVLRQ 6RPH LQKLELWRUV HJ VRGLXP PRQRIOXRURSKRVSKDWH 1D32)  WXUH FRUURVLRQ 6RPH LQKLELWRUV HJ VRGLXP PRQRIOXRURSKRVSKDWH 1D32) 
µ0)3¶  FDQRQO\EHXVHGDVDGLIIXVLRQLQKLELWRUGXHWRDGYHUVHFKHPLFDOUHDF µ0)3¶  FDQRQO\EHXVHGDVDGLIIXVLRQLQKLELWRUGXHWRDGYHUVHFKHPLFDOUHDF
WLRQVZLWKIUHVKFRQFUHWH WLRQVZLWKIUHVKFRQFUHWH
,QWHJUDOLQKLELWRUVDQGWKHJHQHUDOSHUIRUPDQFHRILQKLELWRUVDUHGHDOWZLWKLQWKLV6HF ,QWHJUDOLQKLELWRUVDQGWKHJHQHUDOSHUIRUPDQFHRILQKLELWRUVDUHGHDOWZLWKLQWKLV6HF
WLRQZKHUHDVWKHVSHFLDODWWULEXWHVRIGLIIXVLRQLQKLELWRUVDUHEULHIO\FRPPHQWHGXSRQ WLRQZKHUHDVWKHVSHFLDODWWULEXWHVRIGLIIXVLRQLQKLELWRUVDUHEULHIO\FRPPHQWHGXSRQ
LQ6HFWLRQ LQ6HFWLRQ
7KH XVH RI FRUURVLRQ LQKLELWRUV LV JHQHUDOO\ QRW VSHFLILHG E\ WKH QDWLRQDO FRGHV DQG 7KH XVH RI FRUURVLRQ LQKLELWRUV LV JHQHUDOO\ QRW VSHFLILHG E\ WKH QDWLRQDO FRGHV DQG
VWDQGDUGV%HVLGHVWKHWH[WERRNVOLVWHGLQ6HFWLRQHVSHFLDOO\WKHEURDGFKDSWHUVLQ VWDQGDUGV%HVLGHVWKHWH[WERRNVOLVWHGLQ6HFWLRQHVSHFLDOO\WKHEURDGFKDSWHUVLQ
>%|KQLHWDO5DXSDFKHWDO@FRUURVLRQLQKLELWRUVDUHGHDOWZLWKLQH[WHQ >%|KQLHWDO5DXSDFKHWDO@FRUURVLRQLQKLELWRUVDUHGHDOWZLWKLQH[WHQ
VLYH UHSRUWV >(OVHQHU  7KRPSVRQ HWDO @ DQG SXEOLFDWLRQV HJ >+DQVVRQ VLYH UHSRUWV >(OVHQHU  7KRPSVRQ HWDO @ DQG SXEOLFDWLRQV HJ >+DQVVRQ
HWDO0DPPROLWLHWDO7UpSDQLHUHWDO*DLGLV@ HWDO0DPPROLWLHWDO7UpSDQLHUHWDO*DLGLV@
2IWHQWKHORQJH[SHULHQFHZLWKFRUURVLRQLQKLELWRUVLQHJWKHRLOJDVRUSHWUROHXP 2IWHQWKHORQJH[SHULHQFHZLWKFRUURVLRQLQKLELWRUVLQHJWKHRLOJDVRUSHWUROHXP
LQGXVWU\LVWDNHQDVDQH[DPSOHIRUWKHVXFFHVVIXOXVHRILQKLELWRUV$OVRWKHOLWHUDWXUH LQGXVWU\LVWDNHQDVDQH[DPSOHIRUWKHVXFFHVVIXOXVHRILQKLELWRUV$OVRWKHOLWHUDWXUH
RQ JHQHUDO FRUURVLRQ VFLHQFH HJ >7UHWKHZH\  &KDPEHUODLQ  -RQHV  RQ JHQHUDO FRUURVLRQ VFLHQFH HJ >7UHWKHZH\  &KDPEHUODLQ  -RQHV 
%DUGDO @ JHQHUDOO\ IRFXVHV RQ VXFK DSSOLFDWLRQV ZKLFK UHODWH WR FRUURVLRQ RI %DUGDO @ JHQHUDOO\ IRFXVHV RQ VXFK DSSOLFDWLRQV ZKLFK UHODWH WR FRUURVLRQ RI
PHWDOVLQDFLGLFRUQHXWUDOVROXWLRQVDQGKHQFHPDLQO\WRXQLIRUPFRUURVLRQ FI6HF PHWDOVLQDFLGLFRUQHXWUDOVROXWLRQVDQGKHQFHPDLQO\WRXQLIRUPFRUURVLRQ FI6HF
WLRQ   ,Q WKLV UHVSHFW LQKLELWRUV DUH RIWHQ FODVVLILHG LQWR WKH IROORZLQJ JURXSV WLRQ   ,Q WKLV UHVSHFW LQKLELWRUV DUH RIWHQ FODVVLILHG LQWR WKH IROORZLQJ JURXSV
>7UHWKHZH\ &KDPEHUODLQ>-RQHV%DUGDO7UHWKHZH\ &KDP >7UHWKHZH\ &KDPEHUODLQ>-RQHV%DUGDO7UHWKHZH\ &KDP
EHUODLQ@ EHUODLQ@
‡ $QRGLFLQKLELWRUV LQWKHOLWHUDWXUHDOVRUHIHUUHGWRDVSDVVLYDWRUV  ‡ $QRGLFLQKLELWRUV LQWKHOLWHUDWXUHDOVRUHIHUUHGWRDVSDVVLYDWRUV 
$QRGLFLQKLELWRUVUHDFWZLWKWKHLRQVRIWKHFRUURGLQJPHWDOWRLQFUHDVHLWVDQRGLF $QRGLFLQKLELWRUVUHDFWZLWKWKHLRQVRIWKHFRUURGLQJPHWDOWRLQFUHDVHLWVDQRGLF
SRODULVDWLRQLHµ(FRUU¶DQGSURPRWHWKHIRUPDWLRQRIWKHSDVVLYHOD\HU,QSULQFL SRODULVDWLRQLHµ(FRUU¶DQGSURPRWHWKHIRUPDWLRQRIWKHSDVVLYHOD\HU,QSULQFL
SOHWZRW\SHVRIDQRGLFFRUURVLRQLQKLELWRUVDUHUHOHYDQWIRUVWHHO SOHWZRW\SHVRIDQRGLFFRUURVLRQLQKLELWRUVDUHUHOHYDQWIRUVWHHO
ƕ 2[LGLVLQJDJHQWV FI6HFWLRQ HJFKURPDWHVQLWULWHVDQGQLWUDWHV ƕ 2[LGLVLQJDJHQWV FI6HFWLRQ HJFKURPDWHVQLWULWHVDQGQLWUDWHV
ƕ ,QKLELWRUV WKDW UHTXLUH GLVVROYHG R[\JHQ WR EH HIIHFWLYH HJ VLOLFDWHV SKRV ƕ ,QKLELWRUV WKDW UHTXLUH GLVVROYHG R[\JHQ WR EH HIIHFWLYH HJ VLOLFDWHV SKRV
SKDWHVPRO\EGDWHVDQGERUDWHV SKDWHVPRO\EGDWHVDQGERUDWHV
‡ &DWKRGLFLQKLELWRUV ‡ &DWKRGLFLQKLELWRUV
&DWKRGLFLQKLELWRUVDUHVXSSRVHGWRHLWKHUVORZGRZQWKHFDWKRGLFUHDFWLRQNLQHW &DWKRGLFLQKLELWRUVDUHVXSSRVHGWRHLWKHUVORZGRZQWKHFDWKRGLFUHDFWLRQNLQHW
LFV RU VHOHFWLYHO\ SUHFLSLWDWH RQ FDWKRGLF VLWHV WR LQFUHDVH WKH VXUIDFH LPSHGDQFH LFV RU VHOHFWLYHO\ SUHFLSLWDWH RQ FDWKRGLF VLWHV WR LQFUHDVH WKH VXUIDFH LPSHGDQFH
DQGWROLPLWWKHGLIIXVLRQRIUHGXFLEOHVSHFLHVWRWKHVHFDWKRGLFVLWHV DQGWROLPLWWKHGLIIXVLRQRIUHGXFLEOHVSHFLHVWRWKHVHFDWKRGLFVLWHV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV

‡ $GVRUSWLRQLQKLELWRUV ‡ $GVRUSWLRQLQKLELWRUV
$GVRUSWLRQ LQKLELWRUV DUH EDVHG RQ ORQJ RUJDQLF PROHFXOHV ZLWK VLGH FKDLQV WKDW $GVRUSWLRQ LQKLELWRUV DUH EDVHG RQ ORQJ RUJDQLF PROHFXOHV ZLWK VLGH FKDLQV WKDW
FDQOLPLWWKHGLIIXVLRQRIR[\JHQWRWKHVXUIDFHWUDSWKHPHWDOLRQVRQWKHVXUIDFH FDQOLPLWWKHGLIIXVLRQRIR[\JHQWRWKHVXUIDFHWUDSWKHPHWDOLRQVRQWKHVXUIDFH
DQGUHGXFHWKHUDWHRIGLVVROXWLRQRUVWDELOLVHWKHGRXEOHOD\HU DQGUHGXFHWKHUDWHRIGLVVROXWLRQRUVWDELOLVHWKHGRXEOHOD\HU
%HVLGHVWKHVHWKUHHPDLQJURXSVVXEVWDQFHVWKDWUHWDUGFRUURVLRQE\IRUPLQJSURWHF %HVLGHVWKHVHWKUHHPDLQJURXSVVXEVWDQFHVWKDWUHWDUGFRUURVLRQE\IRUPLQJSURWHF
WLYHSUHFLSLWDWHVRUE\UHPRYLQJDQ DJJUHVVLYHFRQVWLWXHQWIURP WKH HQYLURQPHQW DUH WLYHSUHFLSLWDWHVRUE\UHPRYLQJDQ DJJUHVVLYHFRQVWLWXHQWIURP WKH HQYLURQPHQW DUH
DOVR JHQHUDOO\ FRQVLGHUHG DV LQKLELWRUV +RZHYHU ZH WKLQN WKDW GLIIHUHQW FRQGLWLRQV DOVR JHQHUDOO\ FRQVLGHUHG DV LQKLELWRUV +RZHYHU ZH WKLQN WKDW GLIIHUHQW FRQGLWLRQV
DUH WR EH FRQVLGHUHG ZKHQ LQKLELWLRQ RI FRUURVLRQ LQ FRQFUHWH LV DGGUHVVHG 6WHHO LQ DUH WR EH FRQVLGHUHG ZKHQ LQKLELWLRQ RI FRUURVLRQ LQ FRQFUHWH LV DGGUHVVHG 6WHHO LQ
FRQFUHWHLVLQLWLDOO\SDVVLYHDQGJHQHUDOO\VXSSRVHGWREHNHSWLQWKDWVWDWHIRUVHYHUDO FRQFUHWHLVLQLWLDOO\SDVVLYHDQGJHQHUDOO\VXSSRVHGWREHNHSWLQWKDWVWDWHIRUVHYHUDO
GHFDGHV $V PHQWLRQHG LQ 6HFWLRQ  XQLIRUP FRUURVLRQ DV D UHVXOW RI FDUERQDWLRQ GHFDGHV $V PHQWLRQHG LQ 6HFWLRQ  XQLIRUP FRUURVLRQ DV D UHVXOW RI FDUERQDWLRQ
FDQJHQHUDOO\EHUHJDUGHGDVPDUJLQDODQGWKHPRVWLPSRUWDQWPHFKDQLVPRIFRUURVLRQ FDQJHQHUDOO\EHUHJDUGHGDVPDUJLQDODQGWKHPRVWLPSRUWDQWPHFKDQLVPRIFRUURVLRQ
LQKLELWLRQ VKRXOG WKXV QRW UHODWH WR XQLIRUP FRUURVLRQ SKHQRPHQD EXW PDLQO\ WR LQKLELWLRQ VKRXOG WKXV QRW UHODWH WR XQLIRUP FRUURVLRQ SKHQRPHQD EXW PDLQO\ WR
FKORULGH LQGXFHG GHSDVVLYDWLRQ DQG SLWWLQJ FRUURVLRQ ,QKLELWRUV IRU SLWWLQJ FRUURVLRQ FKORULGH LQGXFHG GHSDVVLYDWLRQ DQG SLWWLQJ FRUURVLRQ ,QKLELWRUV IRU SLWWLQJ FRUURVLRQ
DUHE\IDUOHVVVWXGLHGDQGFDQDFWE\>%HUWROLQLHWDO@ DUHE\IDUOHVVVWXGLHGDQGFDQDFWE\>%HUWROLQLHWDO@
‡ &RPSHWLWLYHVXUIDFHDGVRUSWLRQSURFHVVRILQKLELWRUDQGFKORULGHLRQV ‡ &RPSHWLWLYHVXUIDFHDGVRUSWLRQSURFHVVRILQKLELWRUDQGFKORULGHLRQV
‡ ,QFUHDVLQJRUEXIIHULQJRIWKHS+LQWKHORFDO SLW HQYLURQPHQW ‡ ,QFUHDVLQJRUEXIIHULQJRIWKHS+LQWKHORFDO SLW HQYLURQPHQW
‡ &RPSHWLWLYHPLJUDWLRQRILQKLELWRUDQGFKORULGHLRQVLQWRWKHSLW ‡ &RPSHWLWLYHPLJUDWLRQRILQKLELWRUDQGFKORULGHLRQVLQWRWKHSLW
&RPPHUFLDOLQKLELWRUVDUHQRUPDOO\EOHQGVRIVHYHUDOFRPSRXQGVDQGKHQFHWKHLQ &RPPHUFLDOLQKLELWRUVDUHQRUPDOO\EOHQGVRIVHYHUDOFRPSRXQGVDQGKHQFHWKHLQ
KLELWLQJPHFKDQLVPVFDQEHPXOWLSOHDQGGLIILFXOWWRLGHQWLI\>%HUWROLQLHWDO@ KLELWLQJPHFKDQLVPVFDQEHPXOWLSOHDQGGLIILFXOWWRLGHQWLI\>%HUWROLQLHWDO@
&RPSRXQGJURXSVWKDWKDYHEHHQXVHGDVLQKLELWRUVDUHSULPDULO\FKURPDWHVQLWULWHV &RPSRXQGJURXSVWKDWKDYHEHHQXVHGDVLQKLELWRUVDUHSULPDULO\FKURPDWHVQLWULWHV
SKRVSKDWHVK\SRSKRVSKLWHVDONDOLHVDQGIOXRULGHV0RUHRYHUQHZJURXSVRIRUJDQLF SKRVSKDWHVK\SRSKRVSKLWHVDONDOLHVDQGIOXRULGHV0RUHRYHUQHZJURXSVRIRUJDQLF
PROHFXOHV HJ DONDQRODPLQHV DQG DPLQHV  KDYH HQWHUHG WKH PDUNHW GXULQJ WKH ODVW PROHFXOHV HJ DONDQRODPLQHV DQG DPLQHV  KDYH HQWHUHG WKH PDUNHW GXULQJ WKH ODVW
\HDUVDQGDUHXVHGDVFRPSRQHQWVLQWKHFRPSOH[EOHQGVWKDWDUHPDUNHWHGXQGHUGLI \HDUVDQGDUHXVHGDVFRPSRQHQWVLQWKHFRPSOH[EOHQGVWKDWDUHPDUNHWHGXQGHUGLI
IHUHQWWUDGHQDPHVE\VHYHUDOSURGXFHUV>%HUWROLQLHWDO@6RPHRIWKHEOHQGVRU IHUHQWWUDGHQDPHVE\VHYHUDOSURGXFHUV>%HUWROLQLHWDO@6RPHRIWKHEOHQGVRU
DSSOLHGFRPSRXQGVKDYHEHHQVXJJHVWHGDVEHLQJHIIHFWLYHZKHUHDVRWKHUVKDYHSUR DSSOLHGFRPSRXQGVKDYHEHHQVXJJHVWHGDVEHLQJHIIHFWLYHZKHUHDVRWKHUVKDYHSUR
GXFHGFRQIOLFWLQJUHVXOWVLQODERUDWRU\VFUHHQLQJ WHVWV)XUWKHUPRUH VRPH LQKLELWRUV GXFHGFRQIOLFWLQJUHVXOWVLQODERUDWRU\VFUHHQLQJ WHVWV)XUWKHUPRUH VRPH LQKLELWRUV
ZKLFKDUHFKHPLFDOO\HIIHFWLYHLQWHUPVRIFRUURVLRQSURWHFWLRQZHUHREVHUYHGWRSUR ZKLFKDUHFKHPLFDOO\HIIHFWLYHLQWHUPVRIFRUURVLRQSURWHFWLRQZHUHREVHUYHGWRSUR
GXFHDGYHUVHHIIHFWVRQWKHSK\VLFDOSURSHUWLHVRIWKHFRQFUHWHVXFKDV DVLJQLILFDQW GXFHDGYHUVHHIIHFWVRQWKHSK\VLFDOSURSHUWLHVRIWKHFRQFUHWHVXFKDV DVLJQLILFDQW
UHGXFWLRQ LQ FRPSUHVVLYH VWUHQJWK >$&, 5 @ 7KH YDULRXV EOHQGV DQG FRP UHGXFWLRQ LQ FRPSUHVVLYH VWUHQJWK >$&, 5 @ 7KH YDULRXV EOHQGV DQG FRP
SRXQGVDUHQRWGLVFXVVHGKHUHLQGHWDLODQGUHIHUHQFHLVPDGHWRWKHDERYHPHQWLRQHG SRXQGVDUHQRWGLVFXVVHGKHUHLQGHWDLODQGUHIHUHQFHLVPDGHWRWKHDERYHPHQWLRQHG
OLWHUDWXUH2QO\FDOFLXPQLWULWH FRPPHUFLDOO\NQRZQDV µ'&,¶ PDUNHWHGE\*UDFH  OLWHUDWXUH2QO\FDOFLXPQLWULWH FRPPHUFLDOO\NQRZQDV µ'&,¶ PDUNHWHGE\*UDFH 
ZKLFK LV WR RXU NQRZOHGJH WKH PRVW H[WHQVLYHO\ WHVWHG DQG XVHG LQWHJUDO FRUURVLRQ ZKLFK LV WR RXU NQRZOHGJH WKH PRVW H[WHQVLYHO\ WHVWHG DQG XVHG LQWHJUDO FRUURVLRQ
LQKLELWRU DQG SUREDEO\ WKH RQH ZLWK WKH PRVW SURYHQ VXFFHVV LV EULHIO\ FRPPHQWHG LQKLELWRU DQG SUREDEO\ WKH RQH ZLWK WKH PRVW SURYHQ VXFFHVV LV EULHIO\ FRPPHQWHG
XSRQ:KHQDSSOLHGDFFRUGLQJWRWKHVSHFLILFDWLRQVDQGLQFRPELQDWLRQZLWKDSSURSUL XSRQ:KHQDSSOLHGDFFRUGLQJWRWKHVSHFLILFDWLRQVDQGLQFRPELQDWLRQZLWKDSSURSUL
DWH FRQFUHWH DQG FRYHU GHSWKV FDOFLXP QLWULWH KDV D ORQJ DQGSURYHQWUDFNUHFRUGLQ DWH FRQFUHWH DQG FRYHU GHSWKV FDOFLXP QLWULWH KDV D ORQJ DQGSURYHQWUDFNUHFRUGLQ
HJ WKH 86$ -DSDQ DQG WKH 0LGGOH (DVW >(OVHQHU @ ZKHUH LW LV RIWHQ XVHG LQ HJ WKH 86$ -DSDQ DQG WKH 0LGGOH (DVW >(OVHQHU @ ZKHUH LW LV RIWHQ XVHG LQ
SDUNLQJPDULQHDQGKLJKZD\VWUXFWXUHV+RZHYHUFHUWDLQGLVDGYDQWDJHVFRQFHUQLQJ SDUNLQJPDULQHDQGKLJKZD\VWUXFWXUHV+RZHYHUFHUWDLQGLVDGYDQWDJHVFRQFHUQLQJ
FDOFLXPQLWULWHKDYHDOVREHHQUHSRUWHG&DOFLXPQLWULWHDFWVDVDPRGHUDWHVHWDFFHO FDOFLXPQLWULWHKDYHDOVREHHQUHSRUWHG&DOFLXPQLWULWHDFWVDVDPRGHUDWHVHWDFFHO
 

 *UDFH&RQVWUXFWLRQ3URGXFWV/WG&DPEULGJH0$86$  *UDFH&RQVWUXFWLRQ3URGXFWV/WG&DPEULGJH0$86$

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

HUDWRUIRUFRQFUHWHDQGQRUPDOO\UHTXLUHVWKHDGGLWLRQDOXVHRIZDWHUUHGXFLQJDQGUH HUDWRUIRUFRQFUHWHDQGQRUPDOO\UHTXLUHVWKHDGGLWLRQDOXVHRIZDWHUUHGXFLQJDQGUH
WDUGLQJ DGPL[WXUHV 0RUHRYHU DOO LQYHVWLJDWLRQV LQ WKH OLWHUDWXUH UHSRUW WKDW FDOFLXP WDUGLQJ DGPL[WXUHV 0RUHRYHU DOO LQYHVWLJDWLRQV LQ WKH OLWHUDWXUH UHSRUW WKDW FDOFLXP
QLWULWHKDVWREHSUHVHQWLQVXIILFLHQWO\KLJKFRQFHQWUDWLRQLQRUGHUWREHHIIHFWLYHDQG QLWULWHKDVWREHSUHVHQWLQVXIILFLHQWO\KLJKFRQFHQWUDWLRQLQRUGHUWREHHIIHFWLYHDQG
WKDWWKHUHLVDQLQFUHDVHGULVNRIORFDOFRUURVLRQDWWDFNLQWKHFDVHRILQVXIILFLHQWLQ WKDWWKHUHLVDQLQFUHDVHGULVNRIORFDOFRUURVLRQDWWDFNLQWKHFDVHRILQVXIILFLHQWLQ
KLELWRUGRVDJH KLELWRUGRVDJH
,QWKHOLWHUDWXUHWKHUHLVDJHQHUDODJUHHPHQWWKDWGXHWRLWVR[LGLVLQJSURSHUWLHVFDO ,QWKHOLWHUDWXUHWKHUHLVDJHQHUDODJUHHPHQWWKDWGXHWRLWVR[LGLVLQJSURSHUWLHVFDO
FLXPQLWULWHDFWVDVDQDQRGLFLQKLELWRUOHDGLQJWRDVWDEOHSDVVLYHOD\HU<HWWKHUHDUH FLXPQLWULWHDFWVDVDQDQRGLFLQKLELWRUOHDGLQJWRDVWDEOHSDVVLYHOD\HU<HWWKHUHDUH
GLIIHUHQWVXJJHVWLRQVUHJDUGLQJWKHH[DFWPHFKDQLVP$SRSXODUGHVFULSWLRQLV³&DO GLIIHUHQWVXJJHVWLRQVUHJDUGLQJWKHH[DFWPHFKDQLVP$SRSXODUGHVFULSWLRQLV³&DO
FLXPQLWULWHDFWVDVDSDVVLYDWRUGXHWRLWVR[LGLVLQJSURSHUWLHVDQGVWDELOLVHVWKHSDV FLXPQLWULWHDFWVDVDSDVVLYDWRUGXHWRLWVR[LGLVLQJSURSHUWLHVDQGVWDELOLVHVWKHSDV
VLYH ILOP GXH WR LWV DELOLW\ WR R[LGLVH IHUURXV LRQV WR IHUULF LRQV ZKLFK IRUP SRRUO\ VLYH ILOP GXH WR LWV DELOLW\ WR R[LGLVH IHUURXV LRQV WR IHUULF LRQV ZKLFK IRUP SRRUO\
VROXEOH LURQ R[LGHV´ >%HUWROLQL HWDO @ %DVHG RQ WKH WKHRU\ RQ IRUPDWLRQ RI VROXEOH LURQ R[LGHV´ >%HUWROLQL HWDO @ %DVHG RQ WKH WKHRU\ RQ IRUPDWLRQ RI
SDVVLYH DQRGLFSURGXFWV FI6HFWLRQ ZHFRQVLGHUVXFKGHVFULSWLRQWREHGRXEW SDVVLYH DQRGLFSURGXFWV FI6HFWLRQ ZHFRQVLGHUVXFKGHVFULSWLRQWREHGRXEW
IXO IURP D WKHUPRG\QDPLF SHUVSHFWLYH )XUWKHUPRUH ZH WKLQN WKDW LQ PRVW FDVHV IXO IURP D WKHUPRG\QDPLF SHUVSHFWLYH )XUWKHUPRUH ZH WKLQN WKDW LQ PRVW FDVHV
RWKHU WKDQ FDUERQDWLRQ LQGXFHG FRUURVLRQ DORQH  WKH SRVWXODWHG PHFKDQLVP UDWKHU RWKHU WKDQ FDUERQDWLRQ LQGXFHG FRUURVLRQ DORQH  WKH SRVWXODWHG PHFKDQLVP UDWKHU
FRQWULEXWHVWRDKLJKFRUURVLRQUDWHWKDQLQKLELWVFRUURVLRQLQSDUWLFXODUIRUFKORULGH FRQWULEXWHVWRDKLJKFRUURVLRQUDWHWKDQLQKLELWVFRUURVLRQLQSDUWLFXODUIRUFKORULGH
LQGXFHGFRUURVLRQ FI6HFWLRQ :LWKUHJDUGWRLWVSURYHQWUDFNUHFRUGZHRE LQGXFHGFRUURVLRQ FI6HFWLRQ :LWKUHJDUGWRLWVSURYHQWUDFNUHFRUGZHRE
YLRXVO\ GR QRW SXW WKH XVH RI FDOFLXP QLWULWH LQWR TXHVWLRQ EXW VXJJHVW WKDW RWKHU YLRXVO\ GR QRW SXW WKH XVH RI FDOFLXP QLWULWH LQWR TXHVWLRQ EXW VXJJHVW WKDW RWKHU
PHFKDQLVPVHJWKHIRUPDWLRQRIFRPSOH[R[LGHVEHWZHHQFDOFLXPQLWULWHDQGLURQ PHFKDQLVPVHJWKHIRUPDWLRQRIFRPSOH[R[LGHVEHWZHHQFDOFLXPQLWULWHDQGLURQ
UHVXOW LQ D SDVVLYH ILOP ZLWK LPSURYHG VWDELOLW\ $ WKHUPRG\QDPLF YHULILFDWLRQ HJ UHVXOW LQ D SDVVLYH ILOP ZLWK LPSURYHG VWDELOLW\ $ WKHUPRG\QDPLF YHULILFDWLRQ HJ
EDVHGRQWKHHVWDEOLVKPHQWRIµ0(3'V¶DFFRUGLQJWRWKHPHWKRGVSURSRVHGLQ6HFWLRQ EDVHGRQWKHHVWDEOLVKPHQWRIµ0(3'V¶DFFRUGLQJWRWKHPHWKRGVSURSRVHGLQ6HFWLRQ
LVSULQFLSDOO\SRVVLEOH:HKDYHQRWSHUIRUPHGWKLVVWXG\EHFDXVHLWZDVPDU LVSULQFLSDOO\SRVVLEOH:HKDYHQRWSHUIRUPHGWKLVVWXG\EHFDXVHLWZDVPDU
JLQDOIRUWKHSXUSRVHVRIWKLVWKHVLV JLQDOIRUWKHSXUSRVHVRIWKLVWKHVLV
1HYHUWKHOHVVDVLPLODUHIIHFWFDQEHYHULILHGEDVHGRQWKHLQKLELWLQJHIIHFWRIFKURP 1HYHUWKHOHVVDVLPLODUHIIHFWFDQEHYHULILHGEDVHGRQWKHLQKLELWLQJHIIHFWRIFKURP
DWHV%HVLGHVLQFUHDVLQJµ(FRUU¶DVDQR[LGLVLQJDJHQWWKHLQKLELWLQJHIIHFWRIFKURPDWH DWHV%HVLGHVLQFUHDVLQJµ(FRUU¶DVDQR[LGLVLQJDJHQWWKHLQKLELWLQJHIIHFWRIFKURPDWH
LVDWWULEXWHGWRWKHIRUPDWLRQRIDWLJKWFRPSOH[R[LGHOD\HURQWKHVWHHOVXUIDFHZKLFK LVDWWULEXWHGWRWKHIRUPDWLRQRIDWLJKWFRPSOH[R[LGHOD\HURQWKHVWHHOVXUIDFHZKLFK
LV PDLQO\ FRPSRVHG RI KHPDWLWH DQG FKURPLF R[LGH &U2  DQG DFWV DV DQ HIILFLHQW LV PDLQO\ FRPSRVHG RI KHPDWLWH DQG FKURPLF R[LGH &U2  DQG DFWV DV DQ HIILFLHQW
SDVVLYH OD\HU SUHYHQWLQJ FRUURVLRQ LQ FHUWDLQ HQYLURQPHQWV >-RQHV  %DUGDO SDVVLYH OD\HU SUHYHQWLQJ FRUURVLRQ LQ FHUWDLQ HQYLURQPHQWV >-RQHV  %DUGDO
@:HWKLQNWKDWWKHLQKLELWLQJHIIHFWRIFKURPDWHFDQEHFRQYHQLHQWO\UHSUHVHQWHG @:HWKLQNWKDWWKHLQKLELWLQJHIIHFWRIFKURPDWHFDQEHFRQYHQLHQWO\UHSUHVHQWHG
DQGHYDOXDWHGE\PHDQVRIµ6,3'V¶DVVKRZQLQ)LJXUH  DQGHYDOXDWHGE\PHDQVRIµ6,3'V¶DVVKRZQLQ)LJXUH 

 

 7KHHIIHFWRIFKORULGHRQFKURPLXPV\VWHPVLVEULHIO\GLVFXVVHGLQFRQQHFWLRQZLWKWKHUPRG\QDPLF  7KHHIIHFWRIFKORULGHRQFKURPLXPV\VWHPVLVEULHIO\GLVFXVVHGLQFRQQHFWLRQZLWKWKHUPRG\QDPLF
FRQVLGHUDWLRQVRQVWDLQOHVVVWHHOLQ6HFWLRQ FRQVLGHUDWLRQVRQVWDLQOHVVVWHHOLQ6HFWLRQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV

 
)LJXUH >$@)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/>%@ )LJXUH >$@)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/>%@
µ6,3'¶ RI WKH &U+2 µ6(3'¶ EDVHG RQ 7DEOH  DQG &ULD  í µ6,3'¶ RI WKH &U+2 µ6(3'¶ EDVHG RQ 7DEOH  DQG &ULD  í
PRO/ RQ >$@>&@ µ6,3'¶ RI WKH &U)H+2 µ6(3'¶ EDVHG RQ 7DEOH PRO/ RQ >$@ >&@ µ6,3'¶ RI WKH &U)H+2 µ6(3'¶ EDVHG RQ 7DEOH
DQG&ULD )HLD íPRO/RQ>$@ DQG&ULD )HLD íPRO/RQ>$@
 

7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ6(3'¶RIWKH&U+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ6(3'¶RIWKH&U+2V\VWHP

6ROLG &U &U2    6ROLG &U &U2   


  í í í   í í
6ROXEOH &U  &U  &U2  &U2  +&U2  6ROXEOH &U  &U  &U2  &U2  +&U2í
 
7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH&U)H+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH&U)H+2V\VWHP

6ROLG &U &U)H2 )H )H2 )H2 6ROLG &U &U)H2 )H )H2 )H2
  í í    í í
&U  &U  &U2  &U2  )H  &U  &U  &U2  &U2  )H
6ROXEOH 6ROXEOH
)H +&U2í +)H2í   )H +&U2í +)H2í  
 
)LJXUH>$@VKRZVWKHVWDQGDUG)H+2µ6(3'¶ZKLFKFRUUHVSRQGVWRWKHXQGHUO\ )LJXUH>$@VKRZVWKHVWDQGDUG)H+2µ6(3'¶ZKLFKFRUUHVSRQGVWRWKHXQGHUO\
LQJGLDJUDPIRUWKHµ6,3'V¶LQ)LJXUH>%@DQG>&@ZKHUHWKH&U+2µ6(3'¶DQG LQJGLDJUDPIRUWKHµ6,3'V¶LQ)LJXUH>%@DQG>&@ZKHUHWKH&U+2µ6(3'¶DQG
WKH )H&U+2 µ0(3'¶ UHVSHFWLYHO\ DUH VXSHULPSRVHG RQ 7KH VSHFLHV SUHVHOHFWHG WKH )H&U+2 µ0(3'¶ UHVSHFWLYHO\ DUH VXSHULPSRVHG RQ 7KH VSHFLHV SUHVHOHFWHG
IRUWKH&U+2DQGWKH&U)H+2V\VWHPZHUHGHWHUPLQHGEDVHGRQWKHWKHRUHWLFDO IRUWKH&U+2DQGWKH&U)H+2V\VWHPZHUHGHWHUPLQHGEDVHGRQWKHWKHRUHWLFDO
FRQVLGHUDWLRQVDQGVRXUFHVGHVFULEHGLQ6HFWLRQZKLFKZLOOQRWEHGLVFXVVHGIXU FRQVLGHUDWLRQVDQGVRXUFHVGHVFULEHGLQ6HFWLRQZKLFKZLOOQRWEHGLVFXVVHGIXU
WKHUVLQFHWKLVDQDO\VLVLVIRUH[HPSOLILFDWLRQSXUSRVHVRQO\ WKHUVLQFHWKLVDQDO\VLVLVIRUH[HPSOLILFDWLRQSXUSRVHVRQO\
,QWKHµ6,3'¶RIWKH&U+2µ6(3'¶VXSHULPSRVHGRQWKH)H+2µ6(3'¶LQ)LJXUH ,QWKHµ6,3'¶RIWKH&U+2µ6(3'¶VXSHULPSRVHGRQWKH)H+2µ6(3'¶LQ)LJXUH
 >%@ LW FDQ EH REVHUYHG WKDW FKURPH R[LGH FRYHUV D FULWLFDO SDUW RI WKH FRUURVLRQ  >%@ LW FDQ EH REVHUYHG WKDW FKURPH R[LGH FRYHUV D FULWLFDO SDUW RI WKH FRUURVLRQ
GRPDLQRILURQLQWKHVWDELOLW\GRPDLQRIZDWHUGRZQWRDS+RIDURXQG7KXVLWFDQ GRPDLQRILURQLQWKHVWDELOLW\GRPDLQRIZDWHUGRZQWRDS+RIDURXQG7KXVLWFDQ
EH FRQFOXGHG WKDW WKH DGGLWLRQ RI DQ DSSURSULDWH DPRXQW RI FKURPDWHV LQKLELWV WKH EH FRQFOXGHG WKDW WKH DGGLWLRQ RI DQ DSSURSULDWH DPRXQW RI FKURPDWHV LQKLELWV WKH
IRUPDWLRQ RI )H LQ WKLV GHFLVLYH S+ UDQJH (YHQ PRUH RI WKH FRUURVLRQ GRPDLQ RI IRUPDWLRQ RI )H LQ WKLV GHFLVLYH S+ UDQJH (YHQ PRUH RI WKH FRUURVLRQ GRPDLQ RI
LURQLVFRYHUHGLQFOXGLQJSDUWVRIWKH)HGRPDLQGRZQWRDS+RIDURXQGZKHQ LURQLVFRYHUHGLQFOXGLQJSDUWVRIWKH)HGRPDLQGRZQWRDS+RIDURXQGZKHQ
WKHIRUPDWLRQRIFKURPLXPLURQR[LGH &U)H2 LVWDNHQLQWRFRQVLGHUDWLRQDVVKRZQ WKHIRUPDWLRQRIFKURPLXPLURQR[LGH &U)H2 LVWDNHQLQWRFRQVLGHUDWLRQDVVKRZQ
LQWKHµ6,3'¶RIWKH&U)H+2µ0(3'¶VXSHULPSRVHGRQWKH)H+2µ6(3'¶LQ)LJ LQWKHµ6,3'¶RIWKH&U)H+2µ0(3'¶VXSHULPSRVHGRQWKH)H+2µ6(3'¶LQ)LJ
XUH>&@%DVHGRQWKHLQIRUPDWLRQSURYLGHGLQHJ>0LQ'DW0LQ*DO XUH>&@%DVHGRQWKHLQIRUPDWLRQSURYLGHGLQHJ>0LQ'DW0LQ*DO
:HE0LQ@ZHFRQVLGHUWKHIRUPDWLRQRIFKURPLXPLURQR[LGHWREHWKHUPRG\ :HE0LQ@ZHFRQVLGHUWKHIRUPDWLRQRIFKURPLXPLURQR[LGHWREHWKHUPRG\
QDPLFDOO\ SRVVLEOH LQ PRVW HQYLURQPHQWV DW PRGHUDWH WHPSHUDWXUHV VXFK DV LQ FRQ QDPLFDOO\ SRVVLEOH LQ PRVW HQYLURQPHQWV DW PRGHUDWH WHPSHUDWXUHV VXFK DV LQ FRQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

FUHWH +RZHYHU WKH FRQGLWLRQV RI IRUPDWLRQ QHHG WREH DVVHVVHGPDLQO\FRQFHUQLQJ FUHWH +RZHYHU WKH FRQGLWLRQV RI IRUPDWLRQ QHHG WREH DVVHVVHGPDLQO\FRQFHUQLQJ
WKHUHTXLUHGFRQFHQWUDWLRQVZKLFKFRXOGHJEHSHUIRUPHGE\PHDQVRISRODULVDWLRQ WKHUHTXLUHGFRQFHQWUDWLRQVZKLFKFRXOGHJEHSHUIRUPHGE\PHDQVRISRODULVDWLRQ
FXUYHV FI6HFWLRQ :HWKLQNWKDWLQWKLVZD\WKHIXQFWLRQDQGHIIHFWLYHQHVVRI FXUYHV FI6HFWLRQ :HWKLQNWKDWLQWKLVZD\WKHIXQFWLRQDQGHIIHFWLYHQHVVRI
PDQ\LQKLELWRUVFDQEHDVVHVVHGEDVHGRQWKHUPRG\QDPLFFRQVLGHUDWLRQV PDQ\LQKLELWRUVFDQEHDVVHVVHGEDVHGRQWKHUPRG\QDPLFFRQVLGHUDWLRQV
+HQFHZHFRQVLGHUWKHUPRG\QDPLFFRQVLGHUDWLRQVEDVHGRQFXVWRPPDGHDQGUHSUH +HQFHZHFRQVLGHUWKHUPRG\QDPLFFRQVLGHUDWLRQVEDVHGRQFXVWRPPDGHDQGUHSUH
VHQWDWLYH3RXUEDL[GLDJUDPVWREHDEHQHILFLDOWRROFRQFHUQLQJWKHHYDOXDWLRQRIDYDLO VHQWDWLYH3RXUEDL[GLDJUDPVWREHDEHQHILFLDOWRROFRQFHUQLQJWKHHYDOXDWLRQRIDYDLO
DEOHFRXQWHUPHDVXUHV:LWKUHJDUGWRWKHHIIHFWLYHQHVVRILQKLELWRUVIRUFRUURVLRQSUH DEOHFRXQWHUPHDVXUHV:LWKUHJDUGWRWKHHIIHFWLYHQHVVRILQKLELWRUVIRUFRUURVLRQSUH
YHQWLRQLWFDQEHFRQFOXGHGWKDWEHVLGHVWKHXQFHUWDLQW\DQGULVNFRQFHUQLQJWKHFRU YHQWLRQLWFDQEHFRQFOXGHGWKDWEHVLGHVWKHXQFHUWDLQW\DQGULVNFRQFHUQLQJWKHFRU
UHFW GRVDJH RI PDQ\ FRUURVLRQ LQKLELWRUV LQ SDUWLFXODU DQRGLF LQKLELWRUV  ZH WKLQN UHFW GRVDJH RI PDQ\ FRUURVLRQ LQKLELWRUV LQ SDUWLFXODU DQRGLF LQKLELWRUV  ZH WKLQN
WKDWOHDFKLQJDQGLQUHODWLRQWRWKDWRXWZDUGVGLIIXVLRQFDQLPSDLUWKHORQJWHUPSHU WKDWOHDFKLQJDQGLQUHODWLRQWRWKDWRXWZDUGVGLIIXVLRQFDQLPSDLUWKHORQJWHUPSHU
IRUPDQFHRILQKLELWRUV$SDUWIURPWKLVWKHUHDUHHQYLURQPHQWDODQGRUKHDOWKLVVXHV IRUPDQFHRILQKLELWRUV$SDUWIURPWKLVWKHUHDUHHQYLURQPHQWDODQGRUKHDOWKLVVXHV
UHODWHGWRPDQ\FRUURVLRQLQKLELWRUVHJFKURPDWHVDQGQLWULWHVDUHWR[LF7KXVDSSOL UHODWHGWRPDQ\FRUURVLRQLQKLELWRUVHJFKURPDWHVDQGQLWULWHVDUHWR[LF7KXVDSSOL
FDWLRQRIFDOFLXPQLWULWHLVQRWSHUPLWWHGIRUVWUXFWXUHVSHUPDQHQWO\VXEPHUJHGLQZD FDWLRQRIFDOFLXPQLWULWHLVQRWSHUPLWWHGIRUVWUXFWXUHVSHUPDQHQWO\VXEPHUJHGLQZD
WHU)LQDOO\ZLWKUHJDUGWRWKHJHQHUDOSULQFLSOHRIDQRGLFLQKLELWRUVLWVKRXOGEHHP WHU)LQDOO\ZLWKUHJDUGWRWKHJHQHUDOSULQFLSOHRIDQRGLFLQKLELWRUVLWVKRXOGEHHP
SKDVLVHGRQFHPRUHWKDWEDVHGRQWKHWKHUPRG\QDPLFGHVFULSWLRQRIDFWLYHFRUURVLRQ SKDVLVHGRQFHPRUHWKDWEDVHGRQWKHWKHUPRG\QDPLFGHVFULSWLRQRIDFWLYHFRUURVLRQ
PHFKDQLVPVLQ6HFWLRQUDLVLQJµ(FRUU¶LVDQXQFHUWDLQDQGGDQJHURXVDSSURDFKLQ PHFKDQLVPVLQ6HFWLRQUDLVLQJµ(FRUU¶LVDQXQFHUWDLQDQGGDQJHURXVDSSURDFKLQ
FRUURVLRQSUHYHQWLRQLQSDUWLFXODUZLWKUHJDUGWRFKORULGHLQGXFHGFRUURVLRQ7KHUH FRUURVLRQSUHYHQWLRQLQSDUWLFXODUZLWKUHJDUGWRFKORULGHLQGXFHGFRUURVLRQ7KHUH
IRUHRXUDSSURDFKLQWKHGHVLJQRIQHZFRXQWHUPHDVXUHVLVODUJHO\EDVHGRQORZHULQJ IRUHRXUDSSURDFKLQWKHGHVLJQRIQHZFRXQWHUPHDVXUHVLVODUJHO\EDVHGRQORZHULQJ
WKHSRWHQWLDOLHFDWKRGLFSRODULVDWLRQZKLFKLVGLVFXVVHGLQPRUHGHWDLOWKURXJKRXW WKHSRWHQWLDOLHFDWKRGLFSRODULVDWLRQZKLFKLVGLVFXVVHGLQPRUHGHWDLOWKURXJKRXW
&KDSWHU &KDSWHU

 (OHFWURFKHPLFDO&RQFUHWH6WHHO,QWHUIDFH,PSURYHPHQW  (OHFWURFKHPLFDO&RQFUHWH6WHHO,QWHUIDFH,PSURYHPHQW


(OHFWURFKHPLFDO WUHDWPHQW RI VSHFLPHQV GXULQJ VHWWLQJ RI WKH FRQFUHWH KDV EHHQ GH (OHFWURFKHPLFDO WUHDWPHQW RI VSHFLPHQV GXULQJ VHWWLQJ RI WKH FRQFUHWH KDV EHHQ GH
VFULEHGDVDQH[DPSOHIRULQFUHDVLQJWKHFKORULGHWKUHVKROGRIFDUERQVWHHOUHLQIRUFH VFULEHGDVDQH[DPSOHIRULQFUHDVLQJWKHFKORULGHWKUHVKROGRIFDUERQVWHHOUHLQIRUFH
PHQWLQDQ86SDWHQW>%XHQIHOGHWDO@7KLVWHFKQLTXHLVLQFOXGHGLQWKLV&KDS PHQWLQDQ86SDWHQW>%XHQIHOGHWDO@7KLVWHFKQLTXHLVLQFOXGHGLQWKLV&KDS
WHU DOWKRXJK LW LV WR RXU NQRZOHGJH QRW DSSOLHG LQ SUDFWLFH <HW LW LV DQ H[LVWLQJ WHU DOWKRXJK LW LV WR RXU NQRZOHGJH QRW DSSOLHG LQ SUDFWLFH <HW LW LV DQ H[LVWLQJ
FRXQWHUPHDVXUHDQGRISDUWLFXODUUHOHYDQFHWRWKHSURSRVHGQHZFRXQWHUPHDVXUHV FI FRXQWHUPHDVXUHDQGRISDUWLFXODUUHOHYDQFHWRWKHSURSRVHGQHZFRXQWHUPHDVXUHV FI
&KDSWHU  &KDSWHU 
7KH HOHFWURFKHPLFDO WUHDWPHQW VWDUWV ZLWKLQ  PLQXWHV DIWHU FDVWLQJ DQG FRQVLVWV RI 7KH HOHFWURFKHPLFDO WUHDWPHQW VWDUWV ZLWKLQ  PLQXWHV DIWHU FDVWLQJ DQG FRQVLVWV RI
KROGLQJWKHFDUERQVWHHODWíP96&(LHíP96+(>5$E@IRUWKHILUVW KROGLQJWKHFDUERQVWHHODWíP96&(LHíP96+(>5$E@IRUWKHILUVW
KRXUV7KHFXUUHQWLVWKHQKHOGFRQVWDQWDWP$PIRUWKHQH[WKRXUVDQG IL KRXUV7KHFXUUHQWLVWKHQKHOGFRQVWDQWDWP$PIRUWKHQH[WKRXUVDQG IL
QDOO\LWLVUHGXFHGWRP$PIRUWKHQH[WKRXUV7KHUHVXOWVRIWKLVWUHDWPHQW QDOO\LWLVUHGXFHGWRP$PIRUWKHQH[WKRXUV7KHUHVXOWVRIWKLVWUHDWPHQW
VKRZ WKDW WKH FKORULGH WKUHVKROG OHYHO LV VLJQLILFDQWO\ LQFUHDVHG ZLWK D UHODWLYHO\ VKRZ WKDW WKH FKORULGH WKUHVKROG OHYHO LV VLJQLILFDQWO\ LQFUHDVHG ZLWK D UHODWLYHO\
VPDOO FKDUJH SDVVHG  )RU LQVWDQFH WKH WKUHVKROG DW D YRLG FRQWHQW RI DERXW  KDV VPDOO FKDUJH SDVVHG  )RU LQVWDQFH WKH WKUHVKROG DW D YRLG FRQWHQW RI DERXW  KDV
LQFUHDVHGIURPDURXQGµZZFH¶WRDURXQGµZZFH¶VHH)LJXUHLQ6HF LQFUHDVHGIURPDURXQGµZZFH¶WRDURXQGµZZFH¶VHH)LJXUHLQ6HF
WLRQ WLRQ
6RLWFDQEHFRQFOXGHGWKDW FDWKRGLFSRODULVDWLRQGXULQJVHWWLQJRIWKHFRQFUHWHVLJ 6RLWFDQEHFRQFOXGHGWKDW FDWKRGLFSRODULVDWLRQGXULQJVHWWLQJRIWKHFRQFUHWHVLJ
QLILFDQWO\LPSURYHVWKHFRQFUHWHVWHHOLQWHUIDFH:KLOHZHWKLQNWKDWLPSUHVVHGFXUUHQW QLILFDQWO\LPSURYHVWKHFRQFUHWHVWHHOLQWHUIDFH:KLOHZHWKLQNWKDWLPSUHVVHGFXUUHQW
FDWKRGLFSRODULVDWLRQGXULQJFDVWLQJLVQRWDSSOLFDEOHLQSUDFWLFHLQSDUWLFXODUO\IRULQ FDWKRGLFSRODULVDWLRQGXULQJFDVWLQJLVQRWDSSOLFDEOHLQSUDFWLFHLQSDUWLFXODUO\IRULQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV

VLWXFDVWLQJZHWKLQNWKDWWKHUHDUHRWKHUDSSOLFDEOHPHDQVRIWDUJHWHGFDWKRGLFSRODUL VLWXFDVWLQJZHWKLQNWKDWWKHUHDUHRWKHUDSSOLFDEOHPHDQVRIWDUJHWHGFDWKRGLFSRODUL
VDWLRQGXULQJVHWWLQJRIFRQFUHWHZKLFKLVGLVFXVVHGLQ&KDSWHU VDWLRQGXULQJVHWWLQJRIFRQFUHWHZKLFKLVGLVFXVVHGLQ&KDSWHU

 5HLQIRUFHPHQW&RXQWHUPHDVXUHV  5HLQIRUFHPHQW&RXQWHUPHDVXUHV


:KLOHWKHFRQFUHWHFRXQWHUPHDVXUHVGLVFXVVHGLQ6HFWLRQDLPDWLPSURYLQJWKH :KLOHWKHFRQFUHWHFRXQWHUPHDVXUHVGLVFXVVHGLQ6HFWLRQDLPDWLPSURYLQJWKH
FRQFUHWH EXON WKH IROORZLQJ UHLQIRUFHPHQW FRXQWHUPHDVXUHV ZKLFK DUH EULHIO\ UH FRQFUHWH EXON WKH IROORZLQJ UHLQIRUFHPHQW FRXQWHUPHDVXUHV ZKLFK DUH EULHIO\ UH
YLHZHGDQGWKHUPRG\QDPLFDOO\HYDOXDWHGLQWKLV6HFWLRQDLPDWLPSURYLQJWKHFRUUR YLHZHGDQGWKHUPRG\QDPLFDOO\HYDOXDWHGLQWKLV6HFWLRQDLPDWLPSURYLQJWKHFRUUR
VLRQUHVLVWDQFHRIWKHUHLQIRUFHPHQWLWVHOI VLRQUHVLVWDQFHRIWKHUHLQIRUFHPHQWLWVHOI
‡ 1RQPHWDOOLFUHLQIRUFHPHQW 6HFWLRQ  ‡ 1RQPHWDOOLFUHLQIRUFHPHQW 6HFWLRQ 
‡ 2UJDQLFFRDWLQJRIUHLQIRUFHPHQW 6HFWLRQ  ‡ 2UJDQLFFRDWLQJRIUHLQIRUFHPHQW 6HFWLRQ 
‡ 0HWDOOLFUHLQIRUFHPHQWZLWKLPSURYHGFRUURVLRQUHVLVWDQFH 6HFWLRQ  ‡ 0HWDOOLFUHLQIRUFHPHQWZLWKLPSURYHGFRUURVLRQUHVLVWDQFH 6HFWLRQ 
‡ 0HWDOOLFFODGGLQJRIUHLQIRUFHPHQW 6HFWLRQ  ‡ 0HWDOOLFFODGGLQJRIUHLQIRUFHPHQW 6HFWLRQ 
‡ *DOYDQLVHGUHLQIRUFHPHQW 6HFWLRQ  ‡ *DOYDQLVHGUHLQIRUFHPHQW 6HFWLRQ 
‡ &DWKRGLFSUHYHQWLRQ 6HFWLRQ  ‡ &DWKRGLFSUHYHQWLRQ 6HFWLRQ 
$VIRUPRVWRIWKHFRQFUHWHFRXQWHUPHDVXUHVWKHDERYHOLVWHGUHLQIRUFHPHQWFRXQWHU $VIRUPRVWRIWKHFRQFUHWHFRXQWHUPHDVXUHVWKHDERYHOLVWHGUHLQIRUFHPHQWFRXQWHU
PHDVXUHVDUHVWDQGDUGWHFKQLTXHVWKDWDUHGHVFULEHGWRDODUJHURUVPDOOHUH[WHQWLQWKH PHDVXUHVDUHVWDQGDUGWHFKQLTXHVWKDWDUHGHVFULEHGWRDODUJHURUVPDOOHUH[WHQWLQWKH
WH[WERRNV OLVWHG LQ 6HFWLRQ  ZKLOH QRQPHWDOOLF UHLQIRUFHPHQW DQG PHWDOOLF FODG WH[WERRNV OLVWHG LQ 6HFWLRQ  ZKLOH QRQPHWDOOLF UHLQIRUFHPHQW DQG PHWDOOLF FODG
GLQJ DUH QRW WDNHQ LQWR FRQVLGHUDWLRQ E\ DOO DXWKRUV +RZHYHU WKHVH DSSURDFKHV DUH GLQJ DUH QRW WDNHQ LQWR FRQVLGHUDWLRQ E\ DOO DXWKRUV +RZHYHU WKHVH DSSURDFKHV DUH
LQFOXGHGLQWKLVEULHIUHYLHZVLQFHQRQPHWDOOLFUHLQIRUFHPHQWDSSHDUVWREHVWURQJO\ LQFOXGHGLQWKLVEULHIUHYLHZVLQFHQRQPHWDOOLFUHLQIRUFHPHQWDSSHDUVWREHVWURQJO\
SURPRWHGIRUGXUDELOLW\GHVLJQE\WKHDVVRFLDWHGLQGXVWU\DWSUHVHQWDQGFODGGLQJUH SURPRWHGIRUGXUDELOLW\GHVLJQE\WKHDVVRFLDWHGLQGXVWU\DWSUHVHQWDQGFODGGLQJUH
ODWHVWRFRVWVDYLQJVZKLFKLVDQLPSRUWDQWLVVXHLQWKHFRQVWUXFWLRQPDUNHW ODWHVWRFRVWVDYLQJVZKLFKLVDQLPSRUWDQWLVVXHLQWKHFRQVWUXFWLRQPDUNHW

 1RQ0HWDOOLF5HLQIRUFHPHQW  1RQ0HWDOOLF5HLQIRUFHPHQW


7KHWHUPQRQPHWDOOLFUHLQIRUFHPHQWUHIHUVWRUHLQIRUFHPHQWPDGHRIJODVVDUDPLGRU 7KHWHUPQRQPHWDOOLFUHLQIRUFHPHQWUHIHUVWRUHLQIRUFHPHQWPDGHRIJODVVDUDPLGRU
FDUERQ ILEUH UHLQIRUFHG SRO\PHUV µ)53V¶ %HVLGHV JHQHUDOO\ EULHI  GHVFULSWLRQV RQ FDUERQ ILEUH UHLQIRUFHG SRO\PHUV µ)53V¶ %HVLGHV JHQHUDOO\ EULHI  GHVFULSWLRQV RQ
WKHXVHRIµ)53V¶LQVRPHRIWKHOLWHUDWXUHPHQWLRQHGLQ6HFWLRQ$&,SURYLGHVD WKHXVHRIµ)53V¶LQVRPHRIWKHOLWHUDWXUHPHQWLRQHGLQ6HFWLRQ$&,SURYLGHVD
³*XLGHIRUWKH'HVLJQDQG&RQVWUXFWLRQRI&RQFUHWH5HLQIRUFHGZLWK)53%DUV´>$&, ³*XLGHIRUWKH'HVLJQDQG&RQVWUXFWLRQRI&RQFUHWH5HLQIRUFHGZLWK)53%DUV´>$&,
5@DQGILEUHFHQWO\SXEOLVKHG³)53UHLQIRUFHPHQWLQ5&VWUXFWXUHV´>ILE 5@DQGILEUHFHQWO\SXEOLVKHG³)53UHLQIRUFHPHQWLQ5&VWUXFWXUHV´>ILE
@$SDUWIURPVWUHQJWKHQLQJRIH[LVWLQJUHLQIRUFHGFRQFUHWHVWUXFWXUHVHVSHFLDOO\ @$SDUWIURPVWUHQJWKHQLQJRIH[LVWLQJUHLQIRUFHGFRQFUHWHVWUXFWXUHVHVSHFLDOO\
QHDUVXUIDFH PRXQWHG µ)53¶ UHLQIRUFHPHQW >'6(1  @ ZKLFK DOVR LV D QHDUVXUIDFH PRXQWHG µ)53¶ UHLQIRUFHPHQW >'6(1  @ ZKLFK DOVR LV D
PDMRU UHVHDUFK DUHD DW '78 %\J HJ >5XVLQRZVNL HWDO  7lOMVWHQ  &DUROLQ PDMRU UHVHDUFK DUHD DW '78 %\J HJ >5XVLQRZVNL HWDO  7lOMVWHQ  &DUROLQ
@µ)53¶KDVWRRXUNQRZOHGJHQRWUHDFKHGDQ\SUDFWLFDODSSOLFDWLRQIRUFRQFUHWH @µ)53¶KDVWRRXUNQRZOHGJHQRWUHDFKHGDQ\SUDFWLFDODSSOLFDWLRQIRUFRQFUHWH
VWUXFWXUHV RQ D ODUJHU VFDOH $OVR ZH FRQVLGHU LW GRXEWIXO WKDW µ)53¶ UHLQIRUFHPHQW VWUXFWXUHV RQ D ODUJHU VFDOH $OVR ZH FRQVLGHU LW GRXEWIXO WKDW µ)53¶ UHLQIRUFHPHQW
ZLOOHYHUUHSODFHWUDGLWLRQDOPHWDOOLFUHLQIRUFHPHQWWRDVXEVWDQWLDOH[WHQW8VHRIQRQ ZLOOHYHUUHSODFHWUDGLWLRQDOPHWDOOLFUHLQIRUFHPHQWWRDVXEVWDQWLDOH[WHQW8VHRIQRQ
PHWDOOLF UHLQIRUFHPHQW PD\ VROYH WKH FRUURVLRQ SUREOHP EXW EHVLGHV FRPSURPLVLQJ PHWDOOLF UHLQIRUFHPHQW PD\ VROYH WKH FRUURVLRQ SUREOHP EXW EHVLGHV FRPSURPLVLQJ
VRPHRIWKHJHQHUDOEHQHILWVRIWKHFRQFUHWHVWHHOFRPSRVLWHV\VWHP FI6HFWLRQ  VRPHRIWKHJHQHUDOEHQHILWVRIWKHFRQFUHWHVWHHOFRPSRVLWHV\VWHP FI6HFWLRQ 
µ)53¶ UHLQIRUFHPHQW KDV VRPH PDMRU SUDFWLFDO GUDZEDFNV ZKLFK DUH RIWHQ QRW DF µ)53¶ UHLQIRUFHPHQW KDV VRPH PDMRU SUDFWLFDO GUDZEDFNV ZKLFK DUH RIWHQ QRW DF
NQRZOHGJHG E\ WKH DVVRFLDWHG LQGXVWU\ )RU LQVWDQFH µ)53¶ FDQQRW EH DGMXVWHG RQ NQRZOHGJHG E\ WKH DVVRFLDWHG LQGXVWU\ )RU LQVWDQFH µ)53¶ FDQQRW EH DGMXVWHG RQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

VLWH PRVW µ)53V¶ DUH EULWWOH DQG FRQVHTXHQWO\ VHQVLWLYH WR LPSDFWV IURP D YLEUDWRU VLWH PRVW µ)53V¶ DUH EULWWOH DQG FRQVHTXHQWO\ VHQVLWLYH WR LPSDFWV IURP D YLEUDWRU
ZDONLQJRQWKHµ)53¶UHLQIRUFHPHQWVKRXOGXVXDOO\EHDYRLGHGDQGµ)53¶UHLQIRUFH ZDONLQJRQWKHµ)53¶UHLQIRUFHPHQWVKRXOGXVXDOO\EHDYRLGHGDQGµ)53¶UHLQIRUFH
PHQWLVOLJKWDQGPXVWEHDQFKRUHGWRWKHIRUPZRUNWRDYRLGIORDWLQJ>ILED$&, PHQWLVOLJKWDQGPXVWEHDQFKRUHGWRWKHIRUPZRUNWRDYRLGIORDWLQJ>ILED$&,
5ILE5RVWDP@$SDUWIURPWKHVHSUDFWLFDOLVVXHVDQGSRVVL 5ILE5RVWDP@$SDUWIURPWKHVHSUDFWLFDOLVVXHVDQGSRVVL
EOHVWUXFWXUDOGHVLJQFRQFHUQVUHODWHGWRWKHPLVVLQJGXFWLOLW\DQRWKHUPDMRUGUDZEDFN EOHVWUXFWXUDOGHVLJQFRQFHUQVUHODWHGWRWKHPLVVLQJGXFWLOLW\DQRWKHUPDMRUGUDZEDFN
RI µ)53¶ LV WKH GRXEWIXO SHUIRUPDQFH ZLWK UHJDUG WR ILUH 6R ZH GR QRW FRQVLGHU RI µ)53¶ LV WKH GRXEWIXO SHUIRUPDQFH ZLWK UHJDUG WR ILUH 6R ZH GR QRW FRQVLGHU
µ)53V¶DVDSUDFWLFDODOWHUQDWLYHWRWUDGLWLRQDOHPEHGGHGUHLQIRUFHPHQW+RZHYHUEH µ)53V¶DVDSUDFWLFDODOWHUQDWLYHWRWUDGLWLRQDOHPEHGGHGUHLQIRUFHPHQW+RZHYHUEH
VLGHVWKHPHQWLRQHGSRVVLELOLWLHVLQVWUHQJWKHQLQJWKHUHPLJKWEHSRWHQWLDOZLWKLQWKH VLGHVWKHPHQWLRQHGSRVVLELOLWLHVLQVWUHQJWKHQLQJWKHUHPLJKWEHSRWHQWLDOZLWKLQWKH
SUHFDVWLQJLQGXVWU\DVZHOODVIRUFHUWDLQVSHFLDODSSOLFDWLRQVZKHUHWKHFRQFUHWHFRQ SUHFDVWLQJLQGXVWU\DVZHOODVIRUFHUWDLQVSHFLDODSSOLFDWLRQVZKHUHWKHFRQFUHWHFRQ
VWUXFWLRQ FDQQRW WROHUDWH WKH XVH RI VWHHO )RU LQVWDQFH PDJQHWLF UHVRQDQFH LPDJLQJ VWUXFWLRQ FDQQRW WROHUDWH WKH XVH RI VWHHO )RU LQVWDQFH PDJQHWLF UHVRQDQFH LPDJLQJ
µ05,¶  UHTXLUHV QRQPDJQHWLF VWUXFWXUHV RU WROO ERRWKV UHDGLQJ UDGLR WDJV RIWHQ UH µ05,¶  UHTXLUHV QRQPDJQHWLF VWUXFWXUHV RU WROO ERRWKV UHDGLQJ UDGLR WDJV RIWHQ UH
TXLUHUHLQIRUFHGFRQFUHWHWKDWLVWUDQVSDUHQWWRUDGLR>:LNLPHGLD@ TXLUHUHLQIRUFHGFRQFUHWHWKDWLVWUDQVSDUHQWWRUDGLR>:LNLPHGLD@
$SSOLFDWLRQRIWKHUPRG\QDPLFVSHUWDLQLQJWRµ)53¶GRHVQRWWRUHODWHWRDTXHRXVPH $SSOLFDWLRQRIWKHUPRG\QDPLFVSHUWDLQLQJWRµ)53¶GRHVQRWWRUHODWHWRDTXHRXVPH
WDOOLFFRUURVLRQ DQGWKXVEH\RQGWKHVFRSHRIWKLVWKHVLV WDOOLFFRUURVLRQ DQGWKXVEH\RQGWKHVFRSHRIWKLVWKHVLV

 2UJDQLF&RDWLQJRI5HLQIRUFLQJ6WHHO  2UJDQLF&RDWLQJRI5HLQIRUFLQJ6WHHO


%DVHGRQ6HFWLRQVDQGLWFDQEHFRQFOXGHGWKDWDQ\FRDWLQJWKDWVDIHO\SUHYHQWV %DVHGRQ6HFWLRQVDQGLWFDQEHFRQFOXGHGWKDWDQ\FRDWLQJWKDWVDIHO\SUHYHQWV
R[\JHQKXPLGLW\DQGDJJUHVVLYHLRQVIURPUHDFKLQJWKHFDUERQVWHHOVXUIDFHLHLQ R[\JHQKXPLGLW\DQGDJJUHVVLYHLRQVIURPUHDFKLQJWKHFDUERQVWHHOVXUIDFHLHLQ
KLELWVWKHHOHFWURFKHPLFDOEDVLVIRUWKHFRUURVLRQSURFHVVHQWLUHO\SUHYHQWVFRUURVLRQ KLELWVWKHHOHFWURFKHPLFDOEDVLVIRUWKHFRUURVLRQSURFHVVHQWLUHO\SUHYHQWVFRUURVLRQ
7KXVDSRWHQWLDOPHWKRGLQSURWHFWLQJFDUERQVWHHOLQFRQFUHWHLVWRHVWDEOLVKDQLQVX 7KXVDSRWHQWLDOPHWKRGLQSURWHFWLQJFDUERQVWHHOLQFRQFUHWHLVWRHVWDEOLVKDQLQVX
ODWLQJ EDUULHU FRDWLQJ ZKLFK SUHYHQWV FRQWDFW RI WKH VWHHO ZLWK LWV HQYLURQPHQW ,Q ODWLQJ EDUULHU FRDWLQJ ZKLFK SUHYHQWV FRQWDFW RI WKH VWHHO ZLWK LWV HQYLURQPHQW ,Q
SUDFWLFH FRDWLQJV WKDW DLP DW WKDW WDVN DUH IXVLRQERQGHG HSR[\ KHQFHIRUWK HSR[\  SUDFWLFH FRDWLQJV WKDW DLP DW WKDW WDVN DUH IXVLRQERQGHG HSR[\ KHQFHIRUWK HSR[\ 
DQG SRO\FKORURHWKHQH ,83$& WHUPLQRORJ\  EHWWHU NQRZQ DV SRO\YLQ\O FKORULGH DQG SRO\FKORURHWKHQH ,83$& WHUPLQRORJ\  EHWWHU NQRZQ DV SRO\YLQ\O FKORULGH
µ39&¶  DV WKH PDLQ WKHUPRSODVWLF SRO\PHU 7R RXU NQRZOHGJH µ39&¶  KDV EHHQ µ39&¶  DV WKH PDLQ WKHUPRSODVWLF SRO\PHU 7R RXU NQRZOHGJH µ39&¶  KDV EHHQ
DSSOLHGRQO\PDUJLQDOO\IRUUHLQIRUFHPHQWVWHHOFRDWLQJV(SR[\KDVEHHQXVHGH[WHQ DSSOLHGRQO\PDUJLQDOO\IRUUHLQIRUFHPHQWVWHHOFRDWLQJV(SR[\KDVEHHQXVHGH[WHQ
VLYHO\LQ1RUWK$PHULFDEXWQRWDVPXFKLQ(XURSHVLQFHLWKDVEHHQLQWURGXFHGDVD VLYHO\LQ1RUWK$PHULFDEXWQRWDVPXFKLQ(XURSHVLQFHLWKDVEHHQLQWURGXFHGDVD
QHZ SURWHFWLYH PHDVXUH DJDLQVW FKORULGH LQGXFHG FRUURVLRQ LQ WKH 86$ LQ WKH PLG QHZ SURWHFWLYH PHDVXUH DJDLQVW FKORULGH LQGXFHG FRUURVLRQ LQ WKH 86$ LQ WKH PLG
V>ILED5RVWDP%HUWROLQLHWDO5RVWDP@7KXVIRFXVLQ V>ILED5RVWDP%HUWROLQLHWDO5RVWDP@7KXVIRFXVLQ
WKLV6HFWLRQLVVHWRQHSR[\FRDWLQJV WKLV6HFWLRQLVVHWRQHSR[\FRDWLQJV
&(1 VWDQGDUGV IRU HSR[\FRDWHG UHLQIRUFHPHQW VWHHO KDYH QRW EHHQ SXEOLVKHG EXW &(1 VWDQGDUGV IRU HSR[\FRDWHG UHLQIRUFHPHQW VWHHO KDYH QRW EHHQ SXEOLVKHG EXW
,62‚SURYLGHVWKHDVVRFLDWHGVWDQGDUG>,62@DQG$670SXEOLVKHVPHWULF ,62‚SURYLGHVWKHDVVRFLDWHGVWDQGDUG>,62@DQG$670SXEOLVKHVPHWULF
VWDQGDUGVSHFLILFDWLRQIRUHSR[\FRDWHGVWHHOUHEDUV>$670$0@DVZHOODV VWDQGDUGVSHFLILFDWLRQIRUHSR[\FRDWHGVWHHOUHEDUV>$670$0@DVZHOODV
IRUHSR[\FRDWHGSUHIDEULFDWHGVWHHOUHEDUV>$670$0@ IRUHSR[\FRDWHGSUHIDEULFDWHGVWHHOUHEDUV>$670$0@
:HDJUHHWKDWDQHSR[\FRDWLQJSUHYHQWVFRUURVLRQLIPDQXIDFWXUHGSURSHUO\DQGDE :HDJUHHWKDWDQHSR[\FRDWLQJSUHYHQWVFRUURVLRQLIPDQXIDFWXUHGSURSHUO\DQGDE
VROXWHO\QRGDPDJHLVLQWURGXFHGWRWKHFRDWLQJGXULQJSODFLQJDQGVHUYLFH,WDSSHDUV VROXWHO\QRGDPDJHLVLQWURGXFHGWRWKHFRDWLQJGXULQJSODFLQJDQGVHUYLFH,WDSSHDUV
WREHGLIILFXOWKRZHYHUWRSURYLGHIRUHQWLUHO\GHQVHHSR[\FRDWLQJVLQWKHPDQXIDF WREHGLIILFXOWKRZHYHUWRSURYLGHIRUHQWLUHO\GHQVHHSR[\FRDWLQJVLQWKHPDQXIDF
 

$VRSSRVHGWRHOHFWULFDOO\FRQGXFWLYHSRO\PHUV µ(&3V¶ >5XSSUHFKW@ZKLFKKDYHEHHQLQYHV $VRSSRVHGWRHOHFWULFDOO\FRQGXFWLYHSRO\PHUV µ(&3V¶ >5XSSUHFKW@ZKLFKKDYHEHHQLQYHV
WLJDWHGDVSRVVLEOHFRPSRXQGV HVSHFLDOO\SRO\DQLOLQ>20&@ IRUFRUURVLRQFRXQWHUPHDVXUHVLQ WLJDWHGDVSRVVLEOHFRPSRXQGV HVSHFLDOO\SRO\DQLOLQ>20&@ IRUFRUURVLRQFRXQWHUPHDVXUHVLQ
WKLVSURMHFWEXWUHMHFWHGDWDQHDUO\VWDJH WKLVSURMHFWEXWUHMHFWHGDWDQHDUO\VWDJH
‚ ‚
,QWHUQDWLRQDO2UJDQLVDWLRQIRU6WDQGDUGLVDWLRQ ,62 *HQHYD6ZLW]HUODQG ,QWHUQDWLRQDO2UJDQLVDWLRQIRU6WDQGDUGLVDWLRQ ,62 *HQHYD6ZLW]HUODQG

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV

WXULQJSURFHVVLHWRWDOSUHYHQWLRQRISLQKROHVRQDODUJHVFDOHDVZHOODVWRIL[WKH WXULQJSURFHVVLHWRWDOSUHYHQWLRQRISLQKROHVRQDODUJHVFDOHDVZHOODVWRIL[WKH
FRDWHG UHLQIRUFHPHQW LQ SODFH ZLWKRXW GLVWXUELQJ WKH FRDWLQJ 7KXV IURP WKH HDUO\ FRDWHG UHLQIRUFHPHQW LQ SODFH ZLWKRXW GLVWXUELQJ WKH FRDWLQJ 7KXV IURP WKH HDUO\
V UHSRUWVEHJDQ WR HPHUJH LQGLFDWLQJ WKDW FKORULGH LQGXFHGFRUURVLRQPDLQO\LQ V UHSRUWVEHJDQ WR HPHUJH LQGLFDWLQJ WKDW FKORULGH LQGXFHGFRUURVLRQPDLQO\LQ
IRUPRIFUHYLFHFRUURVLRQ FI6HFWLRQ GHYHORSHGIURPORFDOSLQKROHVDQGGDP IRUPRIFUHYLFHFRUURVLRQ FI6HFWLRQ GHYHORSHGIURPORFDOSLQKROHVDQGGDP
DJHGWKHFRDWLQJZLWKRXWQHFHVVDULO\FDXVLQJFUDFNLQJDQGVSDOOLQJRIFRQFUHWHFRYHU DJHGWKHFRDWLQJZLWKRXWQHFHVVDULO\FDXVLQJFUDFNLQJDQGVSDOOLQJRIFRQFUHWHFRYHU
EXW VORZO\ GLVLQWHJUDWLQJ WKH UHLQIRUFHPHQW >5RVWDP  5RVWDP @ LH D EXW VORZO\ GLVLQWHJUDWLQJ WKH UHLQIRUFHPHQW >5RVWDP  5RVWDP @ LH D
PHFKDQLVPDQGGDPDJHW\SHVLPLODUWRWKHRQHGHVFULEHGLQ6HFWLRQ$SRSX PHFKDQLVPDQGGDPDJHW\SHVLPLODUWRWKHRQHGHVFULEHGLQ6HFWLRQ$SRSX
ODUFDVHRISUHPDWXUHGHWHULRUDWLRQUHODWHGWRHSR[\FRDWHGUHLQIRUFHPHQWZDV HVWDE ODUFDVHRISUHPDWXUHGHWHULRUDWLRQUHODWHGWRHSR[\FRDWHGUHLQIRUFHPHQWZDV HVWDE
OLVKHGE\WKH)ORULGD.H\V%ULGJHV)/86$,QRQO\HLJKW\HDUVDIWHUFRQVWUXF OLVKHGE\WKH)ORULGD.H\V%ULGJHV)/86$,QRQO\HLJKW\HDUVDIWHUFRQVWUXF
WLRQWKH'HSDUWPHQWRI7UDQVSRUWDWLRQREVHUYHGVHULRXVFDVHVRIFRUURVLRQGDPDJHDW WLRQWKH'HSDUWPHQWRI7UDQVSRUWDWLRQREVHUYHGVHULRXVFDVHVRIFRUURVLRQGDPDJHDW
WKH VXEVWUXFWXUHV RI VHYHUDO EULGJHV ZKLFK ZHUH UHLQIRUFHG ZLWK HSR[\FRDWHG UHLQ WKH VXEVWUXFWXUHV RI VHYHUDO EULGJHV ZKLFK ZHUH UHLQIRUFHG ZLWK HSR[\FRDWHG UHLQ
IRUFHPHQW VHH )LJXUH  %HVLGHV WKH VXEWURSLFDO WHPSHUDWXUHV FI 6HFWLRQ   IRUFHPHQW VHH )LJXUH  %HVLGHV WKH VXEWURSLFDO WHPSHUDWXUHV FI 6HFWLRQ  
WKHVHEULGJHFRPSRQHQWVZHUHFRQWLQXRXVO\VXEMHFWHGWRVDOWVSUD\LQWKHVSODVK]RQH WKHVHEULGJHFRPSRQHQWVZHUHFRQWLQXRXVO\VXEMHFWHGWRVDOWVSUD\LQWKHVSODVK]RQH
FRPELQHGZLWKZHWWLQJDQGGU\LQJF\FOHVZKLFKSURGXFHGDYHU\FRUURVLYHHQYLURQ FRPELQHGZLWKZHWWLQJDQGGU\LQJF\FOHVZKLFKSURGXFHGDYHU\FRUURVLYHHQYLURQ
PHQW FI6HFWLRQVDQG  PHQW FI6HFWLRQVDQG 

 
)LJXUH 6SDOOLQJDWSLHURI)ORULGD.H\V%ULGJHV)/86$GXHWRFRUURVLRQRI )LJXUH 6SDOOLQJDWSLHURI)ORULGD.H\V%ULGJHV)/86$GXHWRFRUURVLRQRI
WKHHSR[\FRDWHGUHLQIRUFHPHQW)URP>&2:,F@ WKHHSR[\FRDWHGUHLQIRUFHPHQW)URP>&2:,F@
7KLVHYHQWFDXVHGDPDMRUGLVWXUEDQFHLQ1RUWK$PHULFDVHHPLQJO\GXHWRSXUHFRP 7KLVHYHQWFDXVHGDPDMRUGLVWXUEDQFHLQ1RUWK$PHULFDVHHPLQJO\GXHWRSXUHFRP
PHUFLDO DQG ELDVHG UHDFWLRQV IURP WKH SURGXFHUV RI HSR[\FRDWHG UHLQIRUFHPHQW DQG PHUFLDO DQG ELDVHG UHDFWLRQV IURP WKH SURGXFHUV RI HSR[\FRDWHG UHLQIRUFHPHQW DQG
WKHLU RUJDQLVDWLRQV ZKLOH DW WKDW WLPH WKH WHFKQRORJ\ ZDV VORZO\ VSUHDGLQJ WR WKHLU RUJDQLVDWLRQV ZKLOH DW WKDW WLPH WKH WHFKQRORJ\ ZDV VORZO\ VSUHDGLQJ WR
(XURSHWKH0LGGOH(DVWDQGWRVRPHSDUWVRIWKH)DU(DVW>5RVWDP5RVWDP (XURSHWKH0LGGOH(DVWDQGWRVRPHSDUWVRIWKH)DU(DVW>5RVWDP5RVWDP
@ @
7KH ILUVW PDMRU DSSOLFDWLRQ RI HSR[\FRDWHG UHLQIRUFHPHQW LQ (XURSH ZDV WKH UHLQ 7KH ILUVW PDMRU DSSOLFDWLRQ RI HSR[\FRDWHG UHLQIRUFHPHQW LQ (XURSH ZDV WKH UHLQ
IRUFHPHQWRIWKHSUHFDVWFRQFUHWHVHJPHQWVIRUWKH(DVW7XQQHORIWKH*UHDW%HOW/LQN IRUFHPHQWRIWKHSUHFDVWFRQFUHWHVHJPHQWVIRUWKH(DVW7XQQHORIWKH*UHDW%HOW/LQN
LQ'HQPDUNZKLFKZDVGHVLJQHGLQ$OUHDG\WKHQWKHWUDGLWLRQDOWHFKQRORJ\RI LQ'HQPDUNZKLFKZDVGHVLJQHGLQ$OUHDG\WKHQWKHWUDGLWLRQDOWHFKQRORJ\RI
HSR[\FRDWLQJ ZDV TXHVWLRQHG LQ 'HQPDUN >5RVWDP  5RVWDP @ SDUWLFX HSR[\FRDWLQJ ZDV TXHVWLRQHG LQ 'HQPDUN >5RVWDP  5RVWDP @ SDUWLFX
ODUO\ZLWKUHJDUGWRHOHFWULFDOLQVXODWLRQRIWKHVLQJOHEDUVIURPHDFKRWKHUZKLFKSUH ODUO\ZLWKUHJDUGWRHOHFWULFDOLQVXODWLRQRIWKHVLQJOHEDUVIURPHDFKRWKHUZKLFKSUH
YHQWVWKHXVHRIFDWKRGLFSUHYHQWLRQSURWHFWLRQ FI6HFWLRQV $SDUWIURP YHQWVWKHXVHRIFDWKRGLFSUHYHQWLRQSURWHFWLRQ FI6HFWLRQV $SDUWIURP
WKDW WKH ODUJH QXPEHU RI SLQKROHV DOORZHG E\ WKH RULJLQDO VSHFLILFDWLRQV IRU HSR[\ WKDW WKH ODUJH QXPEHU RI SLQKROHV DOORZHG E\ WKH RULJLQDO VSHFLILFDWLRQV IRU HSR[\
FRDWLQJ LHHDUOLHUYHUVLRQVRI>,62@DQG>$670$0@ ZDVRI FRDWLQJ LHHDUOLHUYHUVLRQVRI>,62@DQG>$670$0@ ZDVRI
FRQFHUQ DV ZHOO DV WKH QHHG IRU SDWFK UHSDLUV RI DOO FXW HQGV DQG FUDFNV IRUPHG DW FRQFHUQ DV ZHOO DV WKH QHHG IRU SDWFK UHSDLUV RI DOO FXW HQGV DQG FUDFNV IRUPHG DW

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

VKDUSO\EHQWFRDWHGEDUV+HQFHLWZDVGHFLGHGWRDSSO\WKHHSR[\FRDWLQJE\DIOXLG VKDUSO\EHQWFRDWHGEDUV+HQFHLWZDVGHFLGHGWRDSSO\WKHHSR[\FRDWLQJE\DIOXLG
LVHGEHGGLSSLQJWHFKQLTXHIRU'IXOOVL]HZHOGHGUHLQIRUFHPHQWFDJHVZKLOHVSHFLDO LVHGEHGGLSSLQJWHFKQLTXHIRU'IXOOVL]HZHOGHGUHLQIRUFHPHQWFDJHVZKLOHVSHFLDO
FOHDQLQJKHDWLQJFRDWLQJDQGWHVWLQJWHFKQLTXHVZHUHLQFRUSRUDWHGWRPLQLPLVHSLQ FOHDQLQJKHDWLQJFRDWLQJDQGWHVWLQJWHFKQLTXHVZHUHLQFRUSRUDWHGWRPLQLPLVHSLQ
KROHV,QWKLVZD\RXWRIVHJPHQWVFDPHRXWZLWKRXWDQ\SLQKROHVDV KROHV,QWKLVZD\RXWRIVHJPHQWVFDPHRXWZLWKRXWDQ\SLQKROHVDV
GHWHUPLQHGE\WKHZHWVSRQJHPHWKRG>5RVWDP6WRUHE OW@+HQFH WKLV GHWHUPLQHGE\WKHZHWVSRQJHPHWKRG>5RVWDP6WRUHE OW@+HQFH WKLV
WHFKQLTXHLVFRQVLGHUHGWREHUHOLDEOH>5RVWDP6WRUHE OW@DQGVRIDUQR WHFKQLTXHLVFRQVLGHUHGWREHUHOLDEOH>5RVWDP6WRUHE OW@DQGVRIDUQR
SUREOHPVKDYHEHHQUHSRUWHGIURPWKH*UHDW%HOW/LQN6WLOOWKH1RUWK$PHULFDQH[ SUREOHPVKDYHEHHQUHSRUWHGIURPWKH*UHDW%HOW/LQN6WLOOWKH1RUWK$PHULFDQH[
SHULHQFHEDVHGRQWKHWUDGLWLRQDOWHFKQRORJ\RIHSR[\FRDWLQJDVZHOODVH[SHULPHQWDO SHULHQFHEDVHGRQWKHWUDGLWLRQDOWHFKQRORJ\RIHSR[\FRDWLQJDVZHOODVH[SHULPHQWDO
VWXGLHV DQG VLWH LQYHVWLJDWLRQV ZLWK XQVDWLVIDFWRU\ UHVXOWV KDYH OHG WR HSR[\FRDWLQJ VWXGLHV DQG VLWH LQYHVWLJDWLRQV ZLWK XQVDWLVIDFWRU\ UHVXOWV KDYH OHG WR HSR[\FRDWLQJ
QRWJDLQLQJDVWURQJIRRWKROGLQ(XURSHDQGLWLVQRZ DOVRVORZO\EHLQJSKDVHGRXW QRWJDLQLQJDVWURQJIRRWKROGLQ(XURSHDQGLWLVQRZ DOVRVORZO\EHLQJSKDVHGRXW
HJWKH0LGGOH(DVWDQGWKH*XOI&RXQWULHV>5RVWDP@ HJWKH0LGGOH(DVWDQGWKH*XOI&RXQWULHV>5RVWDP@
:H DJUHH WR WKH GHVFULEHG QRWLRQV FRQFHUQLQJ HSR[\ ZKLFK SULQFLSDOO\ DSSO\ WR DOO :H DJUHH WR WKH GHVFULEHG QRWLRQV FRQFHUQLQJ HSR[\ ZKLFK SULQFLSDOO\ DSSO\ WR DOO
RUJDQLFUHLQIRUFHPHQWFRDWLQJVWKDWDUHQRWDIIHFWHGE\WKHFRQFUHWHFKHPLVWU\7KLV RUJDQLFUHLQIRUFHPHQWFRDWLQJVWKDWDUHQRWDIIHFWHGE\WKHFRQFUHWHFKHPLVWU\7KLV
VROXWLRQSURYLGHVFRPSOHWHFRUURVLRQSURWHFWLRQLILWLVDVVXUHGWKDWWKHHSR[\FRDWLQJ VROXWLRQSURYLGHVFRPSOHWHFRUURVLRQSURWHFWLRQLILWLVDVVXUHGWKDWWKHHSR[\FRDWLQJ
LVDEVROXWHO\IUHHRIGDPDJHVZKHQWKHVWUXFWXUHJRHVLQWRVHUYLFH+RZHYHUWKLVDS LVDEVROXWHO\IUHHRIGDPDJHVZKHQWKHVWUXFWXUHJRHVLQWRVHUYLFH+RZHYHUWKLVDS
SHDUVWREHDGLIILFXOWWDVNLQSDUWLFXODUZKHQFRQVLGHULQJWKHJHQHUDOSUDFWLFHVGXULQJ SHDUVWREHDGLIILFXOWWDVNLQSDUWLFXODUZKHQFRQVLGHULQJWKHJHQHUDOSUDFWLFHVGXULQJ
FRQVWUXFWLRQ ,Q JHQHUDO WHUPV LW FDQ EH VWDWHG WKDW ZH FRQVLGHU WKH VLQJOH VDIHW\ FRQVWUXFWLRQ ,Q JHQHUDO WHUPV LW FDQ EH VWDWHG WKDW ZH FRQVLGHU WKH VLQJOH VDIHW\
PHFKDQLVPSURYLGHGE\EDUULHUFRDWLQJVWREHDULVNZKHQWKHSUREDELOLW\IRUIDLOXUH PHFKDQLVPSURYLGHGE\EDUULHUFRDWLQJVWREHDULVNZKHQWKHSUREDELOLW\IRUIDLOXUH
LV KLJK %HFDXVH RI WKLV ZH GHFLGHG WR EDVH WKH SURSRVHG QHZ FRXQWHUPHDVXUH RQ D LV KLJK %HFDXVH RI WKLV ZH GHFLGHG WR EDVH WKH SURSRVHG QHZ FRXQWHUPHDVXUH RQ D
FRPELQDWLRQ RI FRUURVLRQ SUHYHQWLYH PHDVXUHV 1HYHUWKHOHVV EDUULHU FRDWLQJV FDQ FRPELQDWLRQ RI FRUURVLRQ SUHYHQWLYH PHDVXUHV 1HYHUWKHOHVV EDUULHU FRDWLQJV FDQ
SURYLGHEHQHILWVIRUFDWKRGLFSUHYHQWLRQSURWHFWLRQ FI6HFWLRQV  SURYLGHEHQHILWVIRUFDWKRGLFSUHYHQWLRQSURWHFWLRQ FI6HFWLRQV 
%DVHG RQ WKH RULJLQDO DLP RI LQKLELWLQJ WKH HOHFWURFKHPLFDO EDVLV RI FRUURVLRQ SURF %DVHG RQ WKH RULJLQDO DLP RI LQKLELWLQJ WKH HOHFWURFKHPLFDO EDVLV RI FRUURVLRQ SURF
HVVHV WKHUPRG\QDPLFV LQ WHUPV RI DTXHRXV PHWDOOLF FRUURVLRQ GRHV QRW FRQFHUQ RU HVVHV WKHUPRG\QDPLFV LQ WHUPV RI DTXHRXV PHWDOOLF FRUURVLRQ GRHV QRW FRQFHUQ RU
JDQLFFRDWLQJV JDQLFFRDWLQJV

 0HWDOOLF5HLQIRUFHPHQWZLWK,PSURYHG&RUURVLRQ5HVLVWDQFH  0HWDOOLF5HLQIRUFHPHQWZLWK,PSURYHG&RUURVLRQ5HVLVWDQFH


0HWDOOLFUHLQIRUFHPHQWZLWKLPSURYHGFRUURVLRQUHVLVWDQFHLVRQHDOWHUQDWLYHWRLQKLE 0HWDOOLFUHLQIRUFHPHQWZLWKLPSURYHGFRUURVLRQUHVLVWDQFHLVRQHDOWHUQDWLYHWRLQKLE
LWLQJ WKH HOHFWURFKHPLVWU\ RI WKH FRUURVLRQ SURFHVVHV RQ D FDUERQ VWHHO VXUIDFH FI LWLQJ WKH HOHFWURFKHPLVWU\ RI WKH FRUURVLRQ SURFHVVHV RQ D FDUERQ VWHHO VXUIDFH FI
6HFWLRQ   ,W KDV SURJUHVVHG LQWR WKH GXUDELOLW\ GHVLJQ PDUNHW GXULQJ WKH SDVW 6HFWLRQ   ,W KDV SURJUHVVHG LQWR WKH GXUDELOLW\ GHVLJQ PDUNHW GXULQJ WKH SDVW
\HDUV :KHQ UHIHUULQJ WR PHWDOOLF UHLQIRUFHPHQW ZLWK LPSURYHG FRUURVLRQ UHVLVWDQFH \HDUV :KHQ UHIHUULQJ WR PHWDOOLF UHLQIRUFHPHQW ZLWK LPSURYHG FRUURVLRQ UHVLVWDQFH
VWDLQOHVVVWHHOGRPLQDWHVGXUDELOLW\GHVLJQEXWUHFHQWO\RWKHUVWHHOTXDOLWLHVZKLFKDUH VWDLQOHVVVWHHOGRPLQDWHVGXUDELOLW\GHVLJQEXWUHFHQWO\RWKHUVWHHOTXDOLWLHVZKLFKDUH
FODLPHGWRSURYLGHVLJQLILFDQWO\LPSURYHGFRUURVLRQUHVLVWDQFHHQWHUHGWKHPDUNHW,Q FODLPHGWRSURYLGHVLJQLILFDQWO\LPSURYHGFRUURVLRQUHVLVWDQFHHQWHUHGWKHPDUNHW,Q
6HFWLRQ  WKH WKHRU\ DQG EDFNJURXQG RI WKH FRUURVLRQ UHVLVWDQFH RI VWDLQOHVV 6HFWLRQ  WKH WKHRU\ DQG EDFNJURXQG RI WKH FRUURVLRQ UHVLVWDQFH RI VWDLQOHVV
VWHHOLVEULHIO\UHYLHZHGDQGWKHUPRG\QDPLFDOO\HYDOXDWHG5HVXOWVIURPRZQLQYHVWL VWHHOLVEULHIO\UHYLHZHGDQGWKHUPRG\QDPLFDOO\HYDOXDWHG5HVXOWVIURPRZQLQYHVWL
JDWLRQVFRQFHUQLQJWKHPHWDOOXUJ\DQGVXUIDFHFRQGLWLRQVRIDVUHFHLYHGVWDLQOHVVVWHHO JDWLRQVFRQFHUQLQJWKHPHWDOOXUJ\DQGVXUIDFHFRQGLWLRQVRIDVUHFHLYHGVWDLQOHVVVWHHO
UHEDUDUHVXPPDULVHGLQ6HFWLRQ UHEDUDUHVXPPDULVHGLQ6HFWLRQ

 7KHRU\  7KHRU\


&(1VSHFLILFDWLRQVIRUVWDLQOHVVVWHHOTXDOLWLHVDUH JLYHQLQ>'6(1@ &(1VSHFLILFDWLRQVIRUVWDLQOHVVVWHHOTXDOLWLHVDUH JLYHQLQ>'6(1@
ZKLOH $670 SURYLGHV SDUWLFXODU VSHFLILFDWLRQV IRU VWDLQOHVV VWHHO UHLQIRUFHPHQW ZKLOH $670 SURYLGHV SDUWLFXODU VSHFLILFDWLRQV IRU VWDLQOHVV VWHHO UHLQIRUFHPHQW

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV

>$670$0@%HVLGHVWKHVHVWDQGDUGVDQGWKHJHQHUDOO\GHWDLOHGFKDSWHUVRQ >$670$0@%HVLGHVWKHVHVWDQGDUGVDQGWKHJHQHUDOO\GHWDLOHGFKDSWHUVRQ
VWDLQOHVV VWHHO UHLQIRUFHPHQW LQ WKH OLWHUDWXUH OLVWHG LQ 6HFWLRQ  D FRPSUHKHQVLYH VWDLQOHVV VWHHO UHLQIRUFHPHQW LQ WKH OLWHUDWXUH OLVWHG LQ 6HFWLRQ  D FRPSUHKHQVLYH
VWDWHRIWKHDUW UHSRUW RQ VWDLQOHVV VWHHO LQ FRQFUHWH ZDV SXEOLVKHG E\ >1UQEHUJHU VWDWHRIWKHDUW UHSRUW RQ VWDLQOHVV VWHHO LQ FRQFUHWH ZDV SXEOLVKHG E\ >1UQEHUJHU
@DQGH[WHQGHGE\WKHVDPHDXWKRUWRWKHODUJHO\GLVFXVVHGILHOGRIWKHSHUIRUP @DQGH[WHQGHGE\WKHVDPHDXWKRUWRWKHODUJHO\GLVFXVVHGILHOGRIWKHSHUIRUP
DQFHLQFUDFNHGFRQFUHWH>1UQEHUJHU %HXO@,QDGGLWLRQWRWKDWVHYHUDORWKHU DQFHLQFUDFNHGFRQFUHWH>1UQEHUJHU %HXO@,QDGGLWLRQWRWKDWVHYHUDORWKHU
UHSRUWVDQGJXLGHOLQHVRQWKHXVHRIVWDLQOHVVVWHHOUHLQIRUFHPHQWZHUHSXEOLVKHGHJ UHSRUWVDQGJXLGHOLQHVRQWKHXVHRIVWDLQOHVVVWHHOUHLQIRUFHPHQWZHUHSXEOLVKHGHJ
>&60DUNHVHWHWDO@ >&60DUNHVHWHWDO@
,QSULQFLSOHWKHLPSURYHGFRUURVLRQUHVLVWDQFHRIVWDLQOHVVVWHHOVLVEDVHGRQDOOR\LQJ ,QSULQFLSOHWKHLPSURYHGFRUURVLRQUHVLVWDQFHRIVWDLQOHVVVWHHOVLVEDVHGRQDOOR\LQJ
FKURPLXP • WRLURQZKLFKUHVXOWVLQWKHIRUPDWLRQRIDGLIIHUHQWO\VWUXFWXUHG FKURPLXP • WRLURQZKLFKUHVXOWVLQWKHIRUPDWLRQRIDGLIIHUHQWO\VWUXFWXUHG
PXFK WRXJKHU SDVVLYH OD\HU ZLWK H[FHOOHQW UHSDVVLYDWLRQ FKDUDFWHULVWLFV FI 6HFWLRQ PXFK WRXJKHU SDVVLYH OD\HU ZLWK H[FHOOHQW UHSDVVLYDWLRQ FKDUDFWHULVWLFV FI 6HFWLRQ
  )XUWKHUPRUH LPSURYHG UHVLVWDQFH DJDLQVW D VSHFLILF IRUP RI DWWDFN RU FHUWDLQ   )XUWKHUPRUH LPSURYHG UHVLVWDQFH DJDLQVW D VSHFLILF IRUP RI DWWDFN RU FHUWDLQ
PHFKDQLFDOSURSHUWLHVFDQEHDFKLHYHGE\DOOR\LQJDGGLWLRQDOHOHPHQWVVXFKDVQLFNHO PHFKDQLFDOSURSHUWLHVFDQEHDFKLHYHGE\DOOR\LQJDGGLWLRQDOHOHPHQWVVXFKDVQLFNHO
PRO\EGHQXPPDQJDQHVHVLOLFRQQLWURJHQFDUERQSKRVSKRUXVDQGVXOSKXU>'DYLV PRO\EGHQXPPDQJDQHVHVLOLFRQQLWURJHQFDUERQSKRVSKRUXVDQGVXOSKXU>'DYLV
@ &RPSDUHGWRWKHSURGXFWLRQRIFDUERQVWHHO FI6HFWLRQ WKHSURGXFWLRQ @ &RPSDUHGWRWKHSURGXFWLRQRIFDUERQVWHHO FI6HFWLRQ WKHSURGXFWLRQ
SURFHVV RI VWDLQOHVV VWHHO ZKLFK LV SULQFLSDOO\ EDVHG RQ D VRSKLVWLFDWHG SURFHVV RI SURFHVV RI VWDLQOHVV VWHHO ZKLFK LV SULQFLSDOO\ EDVHG RQ D VRSKLVWLFDWHG SURFHVV RI
PHOWLQJDQGUHPHOWLQJ>&DOOLVWHU &DOOLVWHU@LVPXFKPRUHFRPSOH[,QFRPEL PHOWLQJDQGUHPHOWLQJ>&DOOLVWHU &DOOLVWHU@LVPXFKPRUHFRPSOH[,QFRPEL
QDWLRQZLWKWKHPRUHH[SHQVLYHUDZPDWHULDOVWKLVOHDGVWRDVLJQLILFDQWO\KLJKHUSULFH QDWLRQZLWKWKHPRUHH[SHQVLYHUDZPDWHULDOVWKLVOHDGVWRDVLJQLILFDQWO\KLJKHUSULFH
IRUVWDLQOHVVVWHHOFRPSDUHGWRFDUERQVWHHO1RZDGD\VVWDLQOHVVVWHHOUHLQIRUFHPHQWLV IRUVWDLQOHVVVWHHOFRPSDUHGWRFDUERQVWHHO1RZDGD\VVWDLQOHVVVWHHOUHLQIRUFHPHQWLV
FRPPHUFLDOO\ DYDLODEOH LQ GLPHQVLRQV VWUHQJWKV DQG DOOR\ W\SHV ZKLFK DUH IXOO\ FRPPHUFLDOO\ DYDLODEOH LQ GLPHQVLRQV VWUHQJWKV DQG DOOR\ W\SHV ZKLFK DUH IXOO\
FRPSDWLEOHZLWKWKHJHQHUDOVWUXFWXUDOUHTXLUHPHQWVIRUUHLQIRUFHGFRQFUHWHVWUXFWXUHV FRPSDWLEOHZLWKWKHJHQHUDOVWUXFWXUDOUHTXLUHPHQWVIRUUHLQIRUFHGFRQFUHWHVWUXFWXUHV
<HWIHZVWDLQOHVVVWHHOJUDGHVDUHXVHGIRUUHLQIRUFLQJVWHHOEHFDXVHDYDLODELOLW\DQG <HWIHZVWDLQOHVVVWHHOJUDGHVDUHXVHGIRUUHLQIRUFLQJVWHHOEHFDXVHDYDLODELOLW\DQG
SULFHDUHDQLVVXHDQGJHQHUDOO\ZLGHO\DYDLODEOHW\SHVVXFKDVDUHXVHG SULFHDUHDQLVVXHDQGJHQHUDOO\ZLGHO\DYDLODEOHW\SHVVXFKDVDUHXVHG
7KHUH LV D JHQHUDO DJUHHPHQW LQ WKH OLWHUDWXUH WKDW DOO W\SHV RI VWDLQOHVV VWHHO UHPDLQ 7KHUH LV D JHQHUDO DJUHHPHQW LQ WKH OLWHUDWXUH WKDW DOO W\SHV RI VWDLQOHVV VWHHO UHPDLQ
SDVVLYHLQFDUERQDWHGFRQFUHWH FI6HFWLRQ DQGWKHXVHRIVWDLQOHVVVWHHOUH SDVVLYHLQFDUERQDWHGFRQFUHWH FI6HFWLRQ DQGWKHXVHRIVWDLQOHVVVWHHOUH
EDUVLVQRUPDOO\DVVRFLDWHGZLWKFKORULGHH[SRVXUH FI6HFWLRQ 6LQFHWKHODWH EDUVLVQRUPDOO\DVVRFLDWHGZLWKFKORULGHH[SRVXUH FI6HFWLRQ 6LQFHWKHODWH
VYDULRXVH[SHULPHQWDOVWXGLHVKDYHEHHQFDUULHGRXWLQRUGHUWRLQYHVWLJDWHWKH VYDULRXVH[SHULPHQWDOVWXGLHVKDYHEHHQFDUULHGRXWLQRUGHUWRLQYHVWLJDWHWKH
FRUURVLRQEHKDYLRXURIVWDLQOHVVVWHHOLQFKORULGHFRQWDPLQDWHGFRQFUHWH3LWWLQJFRUUR FRUURVLRQEHKDYLRXURIVWDLQOHVVVWHHOLQFKORULGHFRQWDPLQDWHGFRQFUHWH3LWWLQJFRUUR
VLRQ FI 6HFWLRQ   LV FRQVLGHUHG WR EH WKH GRPLQDQW IRUP RI FRUURVLRQ IRU VLRQ FI 6HFWLRQ   LV FRQVLGHUHG WR EH WKH GRPLQDQW IRUP RI FRUURVLRQ IRU
VWDLQOHVVVWHHOLQFKORULGHFRQWDPLQDWHGFRQFUHWH,QWHUJUDQXODUFRUURVLRQ FI6HFWLRQ VWDLQOHVVVWHHOLQFKORULGHFRQWDPLQDWHGFRQFUHWH,QWHUJUDQXODUFRUURVLRQ FI6HFWLRQ
 FDQUHVXOWIURPZHOGLQJEXWLWFDQQRUPDOO\EHDYRLGHGE\XVLQJVXLWDEOHW\SHV  FDQUHVXOWIURPZHOGLQJEXWLWFDQQRUPDOO\EHDYRLGHGE\XVLQJVXLWDEOHW\SHV
RIVWHHODVZHOODVDQDSSURSULDWHSRVWWUHDWPHQW6FDOHDQGWHPSHUFRORXUVDJJUDYDWH RIVWHHODVZHOODVDQDSSURSULDWHSRVWWUHDWPHQW6FDOHDQGWHPSHUFRORXUVDJJUDYDWH
FRUURVLRQLIQRWUHPRYHGE\SLFNOLQJRUJULWEODVWLQJ‚%HVLGHVLQKRPRJHQHLWLHVLQWUR FRUURVLRQLIQRWUHPRYHGE\SLFNOLQJRUJULWEODVWLQJ‚%HVLGHVLQKRPRJHQHLWLHVLQWUR
GXFHGE\ZHOGLQJSUHVHQFHRIPLOOVFDOHRURWKHULPSXULWLHVRQWKHVXUIDFHVWHHOVXU GXFHGE\ZHOGLQJSUHVHQFHRIPLOOVFDOHRURWKHULPSXULWLHVRQWKHVXUIDFHVWHHOVXU
IDFH FI 6HFWLRQ   LV FRQVLGHUHG WR LQWHUIHUH ZLWK WKH IRUPDWLRQ RI DQ LGHDO IDFH FI 6HFWLRQ   LV FRQVLGHUHG WR LQWHUIHUH ZLWK WKH IRUPDWLRQ RI DQ LGHDO

 

7KHUHTXLUHGVSHFLILHGDQGLQYHVWLJDWHGFRPSRVLWLRQRIUHLQIRUFHPHQWVWHHORIVWDLQOHVVVWHHOJUDGH 7KHUHTXLUHGVSHFLILHGDQGLQYHVWLJDWHGFRPSRVLWLRQRIUHLQIRUFHPHQWVWHHORIVWDLQOHVVVWHHOJUDGH
>'6(1@>$670'6@LVVKRZQLQ7DEOHDWWKHHQGRIWKLV >'6(1@>$670'6@LVVKRZQLQ7DEOHDWWKHHQGRIWKLV
6HFWLRQ 6HFWLRQ
‚ ‚
:HFRQVLGHUSLFNOLQJWREHVXSHULRUWRJULWEODVWLQJZLWKUHJDUGWRFRUURVLRQUHVLVWDQFH$OWKRXJKQRW :HFRQVLGHUSLFNOLQJWREHVXSHULRUWRJULWEODVWLQJZLWKUHJDUGWRFRUURVLRQUHVLVWDQFH$OWKRXJKQRW
GLUHFWO\UHODWHGWRFRQFUHWHUHLQIRUFHPHQWDFDVHLQSRLQWDUHWKHFRUURVLRQSUREOHPVRQWKHJULW GLUHFWO\UHODWHGWRFRQFUHWHUHLQIRUFHPHQWDFDVHLQSRLQWDUHWKHFRUURVLRQSUREOHPVRQWKHJULW
EODVWHGVWDLQOHVVIDoDGHHOHPHQWVRIWKHQHZRSHUDLQ&RSHQKDJHQ'HQPDUN7KLVLOOXVWUDWHVWKDWJULW EODVWHGVWDLQOHVVIDoDGHHOHPHQWVRIWKHQHZRSHUDLQ&RSHQKDJHQ'HQPDUN7KLVLOOXVWUDWHVWKDWJULW
EODVWLQJVKRXOGQRWEHWKHIDYRXUHGWHFKQLTXHIRUUHPRYLQJVFDOHIURPDVWDLQOHVVVWHHOVXUIDFH EODVWLQJVKRXOGQRWEHWKHIDYRXUHGWHFKQLTXHIRUUHPRYLQJVFDOHIURPDVWDLQOHVVVWHHOVXUIDFH

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

SDVVLYHOD\HUDQGKHQFHWRDIIHFWWKHFRUURVLRQUHVLVWDQFH>1UQEHUJHU&XWOHU SDVVLYHOD\HUDQGKHQFHWRDIIHFWWKHFRUURVLRQUHVLVWDQFH>1UQEHUJHU&XWOHU
HWDO  1UQEHUJHU  %HXO  5RVWDP  %HUWROLQL HWDO  HWDO  1UQEHUJHU  %HXO  5RVWDP  %HUWROLQL HWDO 
&KRZGKXU\&OHPHxD 9LUPDQL@ &KRZGKXU\&OHPHxD 9LUPDQL@
'RXEWV KDYH EHHQ UDLVHG FRQFHUQLQJ WKH FRUURVLRQ UHVLVWDQFH RI VWDLQOHVV VWHHOV LQ 'RXEWV KDYH EHHQ UDLVHG FRQFHUQLQJ WKH FRUURVLRQ UHVLVWDQFH RI VWDLQOHVV VWHHOV LQ
FUDFNHGFRQFUHWHVLQFHFUDFNVFDUERQDWHUDSLGO\DQGFDQDFWDVKLJKYHORFLW\SHQHWUD FUDFNHGFRQFUHWHVLQFHFUDFNVFDUERQDWHUDSLGO\DQGFDQDFWDVKLJKYHORFLW\SHQHWUD
WLRQSDWKVIRUFKORULGHLRQV FI6HFWLRQ +RZHYHUDFFRUGLQJWR>1UQEHUJHU WLRQSDWKVIRUFKORULGHLRQV FI6HFWLRQ +RZHYHUDFFRUGLQJWR>1UQEHUJHU
%HXO@VWDLQOHVVVWHHOUHLQIRUFHPHQWLVJHQHUDOO\VXLWDEOHIRUWKHXQIDYRXUDEOH %HXO@VWDLQOHVVVWHHOUHLQIRUFHPHQWLVJHQHUDOO\VXLWDEOHIRUWKHXQIDYRXUDEOH
FDVHRIKLJKO\FKORULGHFRQWDPLQDWHGFUDFNHGFRQFUHWH FDVHRIKLJKO\FKORULGHFRQWDPLQDWHGFUDFNHGFRQFUHWH
$ SURPLQHQW GRFXPHQWDWLRQ RI WKH SHUIRUPDQFH RI VWDLQOHVV VWHHO UHLQIRUFHPHQW LQ $ SURPLQHQW GRFXPHQWDWLRQ RI WKH SHUIRUPDQFH RI VWDLQOHVV VWHHO UHLQIRUFHPHQW LQ
KLJKO\ FKORULGH FRQWDPLQDWHG FRQFUHWH LV WKH FRQFUHWH SLHU LQWR WKH 0H[LFDQ *XOI DW KLJKO\ FKORULGH FRQWDPLQDWHG FRQFUHWH LV WKH FRQFUHWH SLHU LQWR WKH 0H[LFDQ *XOI DW
3URJUHVR0H[LFRZKLFKZDVRSHQHGLQVHH)LJXUH>$@ 3URJUHVR0H[LFRZKLFKZDVRSHQHGLQVHH)LJXUH>$@

 
)LJXUH &RQFUHWH SLHUV LQWR WKH 0H[LFDQ *XOI DW 3URJUHVR 0H[LFR )URP )LJXUH &RQFUHWH SLHUV LQWR WKH 0H[LFDQ *XOI DW 3URJUHVR 0H[LFR )URP
>5DPE¡OO@>$@3HULVKHGFDUERQVWHHOUHLQIRUFHGSLHU RSHQHGLQ >5DPE¡OO@>$@3HULVKHGFDUERQVWHHOUHLQIRUFHGSLHU RSHQHGLQ
  LQ WKH IRUHJURXQG DQG H[LVWLQJ VWDLQOHVV VWHHO UHLQIRUFHG SLHU   LQ WKH IRUHJURXQG DQG H[LVWLQJ VWDLQOHVV VWHHO UHLQIRUFHG SLHU
RSHQHG LQ   LQ WKH EDFNJURXQG >%@ &ORVH XS RI UHPDLQV RI WKH RSHQHG LQ   LQ WKH EDFNJURXQG >%@ &ORVH XS RI UHPDLQV RI WKH
GHFNRIWKHFDUERQVWHHOUHLQIRUFHGSLHU GHFNRIWKHFDUERQVWHHOUHLQIRUFHGSLHU
%HFDXVHRIWKHVHYHUHHQYLURQPHQWDOH[SRVXUHRIWKHSLHUDQGXVHRIFRQFUHWHZLWKD %HFDXVHRIWKHVHYHUHHQYLURQPHQWDOH[SRVXUHRIWKHSLHUDQGXVHRIFRQFUHWHZLWKD
UHODWLYHO\KLJKSRURVLW\ GXHWRWKHXVHRIORFDOOLPHVWRQHDJJUHJDWH LWZDVGHFLGHGWR UHODWLYHO\KLJKSRURVLW\ GXHWRWKHXVHRIORFDOOLPHVWRQHDJJUHJDWH LWZDVGHFLGHGWR
XVHVWDLQOHVVVWHHOUHLQIRUFHPHQWLQVHOHFWHGDUHDVRIWKHSLHU'HVSLWHWKHKDUVKHQYL XVHVWDLQOHVVVWHHOUHLQIRUFHPHQWLQVHOHFWHGDUHDVRIWKHSLHU'HVSLWHWKHKDUVKHQYL
URQPHQWDQGWKHSRRUTXDOLW\PDWHULDOVXVHGLQWKHFRQVWUXFWLRQQRFRQVLGHUDEOHFRU URQPHQWDQGWKHSRRUTXDOLW\PDWHULDOVXVHGLQWKHFRQVWUXFWLRQQRFRQVLGHUDEOHFRU
URVLRQ GDPDJH ZDV REVHUYHG DW WKH VWDLQOHVV VWHHO UHLQIRUFHG SLHU $ QHZHU SDUDOOHO URVLRQ GDPDJH ZDV REVHUYHG DW WKH VWDLQOHVV VWHHO UHLQIRUFHG SLHU $ QHZHU SDUDOOHO
SLHUZKLFKZDVRSHQHGLQZDVUHLQIRUFHGZLWKFDUERQVWHHODQGSHULVKHG\HDUV SLHUZKLFKZDVRSHQHGLQZDVUHLQIRUFHGZLWKFDUERQVWHHODQGSHULVKHG\HDUV
DJRGXHWRGHWHULRUDWLRQLQGXFHGE\UHLQIRUFHPHQWFRUURVLRQ VHH)LJXUH>$@ DQG DJRGXHWRGHWHULRUDWLRQLQGXFHGE\UHLQIRUFHPHQWFRUURVLRQ VHH)LJXUH>$@ DQG
WKH FORVHXS RI GHWHULRUDWHG UHPDLQV RI WKH GHFN RI WKH SLHU LQ )LJXUH  >%@  WKH FORVHXS RI GHWHULRUDWHG UHPDLQV RI WKH GHFN RI WKH SLHU LQ )LJXUH  >%@ 
>5DPE¡OO5RVWDP5RVWDP@ >5DPE¡OO5RVWDP5RVWDP@
6RVWDLQOHVVVWHHOUHLQIRUFHPHQWDSSHDUVWRJUDQWHIIHFWLYHFRUURVLRQSURWHFWLRQHYHQ 6RVWDLQOHVVVWHHOUHLQIRUFHPHQWDSSHDUVWRJUDQWHIIHFWLYHFRUURVLRQSURWHFWLRQHYHQ
LQ KDUVK HQYLURQPHQWV +RZHYHU WKH KLJK SULFH RI VWDLQOHVV VWHHO FDQQRW DOZD\V EH LQ KDUVK HQYLURQPHQWV +RZHYHU WKH KLJK SULFH RI VWDLQOHVV VWHHO FDQQRW DOZD\V EH
MXVWLILHG 7R FXW FRVWV HIIRUWV KDYH EHHQ PDGH WR DPRQJ RWKHUV XVH HJ FKHDSHU MXVWLILHG 7R FXW FRVWV HIIRUWV KDYH EHHQ PDGH WR DPRQJ RWKHUV XVH HJ FKHDSHU
VWDLQOHVVVWHHOJUDGHVEXWWKHSHUIRUPDQFHZDV JHQHUDOO\REVHUYHGWRGHFUHDVHPRUH VWDLQOHVVVWHHOJUDGHVEXWWKHSHUIRUPDQFH ZDV JHQHUDOO\REVHUYHG WR GHFUHDVHPRUH
WKDQWKHFRVW7KHUHIRUHHYHQDPRQJWKHDXVWHQLWLFJUDGHVZKHUHJUDGH WKDQWKHFRVW7KHUHIRUHHYHQDPRQJWKHDXVWHQLWLFJUDGHVZKHUHJUDGH
LVWKHQRUPLQPRVWSURMHFWVLWLVFRQVLGHUHGWREHFRVWHIILFLHQWWRVSHFLI\SUHPLXP LVWKHQRUPLQPRVWSURMHFWVLWLVFRQVLGHUHGWREHFRVWHIILFLHQWWRVSHFLI\SUHPLXP

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV

JUDGHVDV>&KRZGKXU\@$QRWKHUUHFHQWDSSURDFKKDVEHHQVHOHF JUDGHVDV>&KRZGKXU\@$QRWKHUUHFHQWDSSURDFKKDVEHHQVHOHF
WLYH XVH RI VWDLQOHVV VWHHO LH DSSOLFDWLRQ RI VWDLQOHVV VWHHOV RQO\ LQ WKH PRVW FULWLFDO WLYH XVH RI VWDLQOHVV VWHHO LH DSSOLFDWLRQ RI VWDLQOHVV VWHHOV RQO\ LQ WKH PRVW FULWLFDO
]RQHV ZKLOH FDUERQ VWHHO LV XVHG IRU WKH UHPDLQLQJ SDUWV RI WKH VWUXFWXUH 6WDLQOHVV ]RQHV ZKLOH FDUERQ VWHHO LV XVHG IRU WKH UHPDLQLQJ SDUWV RI WKH VWUXFWXUH 6WDLQOHVV
VWHHOUHLQIRUFHPHQWFDQEHFRPELQHGDQGHOHFWULFDOO\FRQQHFWHGZLWKFDUERQVWHHOFDVW VWHHOUHLQIRUFHPHQWFDQEHFRPELQHGDQGHOHFWULFDOO\FRQQHFWHGZLWKFDUERQVWHHOFDVW
LQWRFRQFUHWHZLWKRXWULVNVRIJDOYDQLFFRUURVLRQ FI6HFWLRQ EHFDXVHWKHWZR LQWRFRQFUHWHZLWKRXWULVNVRIJDOYDQLFFRUURVLRQ FI6HFWLRQ EHFDXVHWKHWZR
W\SHVRIVWHHOVDUHQHDUO\DWWKHVDPHFRUURVLRQSRWHQWLDOZKHQHPEHGGHGLQFRQFUHWH W\SHVRIVWHHOVDUHQHDUO\DWWKHVDPHFRUURVLRQSRWHQWLDOZKHQHPEHGGHGLQFRQFUHWH
>.OLQJKRIIHU5RVWDP5RVWDP@7KLVFHQWUDODVSHFWZDVFRQILUPHG >.OLQJKRIIHU5RVWDP5RVWDP@7KLVFHQWUDODVSHFWZDVFRQILUPHG
LQ RXU LQYHVWLJDWLRQV >.WHU HWDO E@ DV LOOXVWUDWHG LQ )LJXUH  >%@ $V PHQ LQ RXU LQYHVWLJDWLRQV >.WHU HWDO E@ DV LOOXVWUDWHG LQ )LJXUH  >%@ $V PHQ
WLRQHG RWKHU DSSURDFKHV LQ WKH HIIRUW WR GHYHORS UHLQIRUFLQJ VWHHO ZLWK DQ LPSURYHG WLRQHG RWKHU DSSURDFKHV LQ WKH HIIRUW WR GHYHORS UHLQIRUFLQJ VWHHO ZLWK DQ LPSURYHG
FRUURVLRQ UHVLVWDQFH LQFOXGHG HJ PLFURFRPSRVLWH VWHHOV µ00);¶  DQG WXQJVWHQ FRUURVLRQ UHVLVWDQFH LQFOXGHG HJ PLFURFRPSRVLWH VWHHOV µ00);¶  DQG WXQJVWHQ
GRSHG VWHHOV >&KRZGKXU\ @ 6RPH RI WKHVH GHYHORSPHQWV PLJKW EH SURPLVLQJ GRSHG VWHHOV >&KRZGKXU\ @ 6RPH RI WKHVH GHYHORSPHQWV PLJKW EH SURPLVLQJ
EXWWKHUHDSSHDUVWREHDODFNRIDIILUPDWLYHVWXGLHVDQGGRXEWVZLWKUHJDUGWRWKHDF EXWWKHUHDSSHDUVWREHDODFNRIDIILUPDWLYHVWXGLHVDQGGRXEWVZLWKUHJDUGWRWKHDF
WXDOVDYLQJVFRPSDUHGWRVWDLQOHVVVWHHO WXDOVDYLQJVFRPSDUHGWRVWDLQOHVVVWHHO
:H WKLQN WKDW VWDLQOHVV VWHHO ZLOO IXUWKHU GRPLQDWH WKH PDUNHW LQ WHUPV RI FRUURVLRQ :H WKLQN WKDW VWDLQOHVV VWHHO ZLOO IXUWKHU GRPLQDWH WKH PDUNHW LQ WHUPV RI FRUURVLRQ
SURWHFWLRQ DFKLHYHG E\ LPSURYHG FRUURVLRQ UHVLVWDQFH +RZHYHU WKH LQLWLDO FRVWV RI SURWHFWLRQ DFKLHYHG E\ LPSURYHG FRUURVLRQ UHVLVWDQFH +RZHYHU WKH LQLWLDO FRVWV RI
VSHFLI\LQJVWDLQOHVVVWHHODUHVLJQLILFDQWO\KLJKHUWKDQRWKHUW\SHVRIFRUURVLRQSURWHF VSHFLI\LQJVWDLQOHVVVWHHODUHVLJQLILFDQWO\KLJKHUWKDQRWKHUW\SHVRIFRUURVLRQSURWHF
WLRQ FI6HFWLRQ ZKLFKPDNHVVSHFLILFDWLRQGLIILFXOWXQOHVVWKHHQYLURQPHQWLV WLRQ FI6HFWLRQ ZKLFKPDNHVVSHFLILFDWLRQGLIILFXOWXQOHVVWKHHQYLURQPHQWLV
GHHPHG WR EH KLJKO\ FRUURVLYH )RU LQVWDQFH IRU VWUXFWXUHV VXEMHFWHG WR FDUERQDWLRQ GHHPHG WR EH KLJKO\ FRUURVLYH )RU LQVWDQFH IRU VWUXFWXUHV VXEMHFWHG WR FDUERQDWLRQ
RQO\ZHWKLQNWKDWLQDGGLWLRQWRSURSHUGHVLJQRIWKHFRQFUHWHPL[DQGWKHFRQFUHWH RQO\ZHWKLQNWKDWLQDGGLWLRQWRSURSHUGHVLJQRIWKHFRQFUHWHPL[DQGWKHFRQFUHWH
FRYHU FI6HFWLRQ FRUURVLRQSURWHFWLRQFDQEHDFKLHYHGE\XVLQJOHVVH[SHQVLYH FRYHU FI6HFWLRQ FRUURVLRQSURWHFWLRQFDQEHDFKLHYHGE\XVLQJOHVVH[SHQVLYH
DYDLODEOHFRXQWHUPHDVXUHVHJ JDOYDQLVHGVWHHO FI6HFWLRQ ,QVHYHUHFKOR DYDLODEOHFRXQWHUPHDVXUHVHJ JDOYDQLVHGVWHHO FI6HFWLRQ ,QVHYHUHFKOR
ULGHHQYLURQPHQWVVWDLQOHVVVWHHOFDQEHDQDWWUDFWLYHRSWLRQEDVHGRQOLIHF\FOHFRVW ULGHHQYLURQPHQWVVWDLQOHVVVWHHOFDQEHDQDWWUDFWLYHRSWLRQEDVHGRQOLIHF\FOHFRVW
LQJ FI 6HFWLRQ   LQ SDUWLFXODU ZKHQ VHOHFWLYH XVH RI VWDLQOHVV VWHHO LV VSHFLILHG LQJ FI 6HFWLRQ   LQ SDUWLFXODU ZKHQ VHOHFWLYH XVH RI VWDLQOHVV VWHHO LV VSHFLILHG
0RUHRYHU ZH FRQVLGHU VWDLQOHVV VWHHO UHLQIRUFHPHQW DV DQ DWWUDFWLYH RSWLRQ IURP D 0RUHRYHU ZH FRQVLGHU VWDLQOHVV VWHHO UHLQIRUFHPHQW DV DQ DWWUDFWLYH RSWLRQ IURP D
SUDFWLFDO SRLQW RI YLHZ EHFDXVH WKH FRPPRQ FRQVWUXFWLRQ SUDFWLFH UHPDLQV XQ SUDFWLFDO SRLQW RI YLHZ EHFDXVH WKH FRPPRQ FRQVWUXFWLRQ SUDFWLFH UHPDLQV XQ
FKDQJHGDQGWKHPDWHULDOLWVHOILVQRWVHQVLWLYHWRWKHGHVLJQKDQGOLQJDQGH[HFXWLRQ FKDQJHGDQGWKHPDWHULDOLWVHOILVQRWVHQVLWLYHWRWKHGHVLJQKDQGOLQJDQGH[HFXWLRQ
LQ FRQWUDVW WR DOO FRQFUHWH FRXQWHUPHDVXUHV µ)53V¶ RU RUJDQLF FRDWLQJ RI UHLQIRUFH LQ FRQWUDVW WR DOO FRQFUHWH FRXQWHUPHDVXUHV µ)53V¶ RU RUJDQLF FRDWLQJ RI UHLQIRUFH
PHQW0RUHRYHUZLWKUHJDUGWRGHVLJQDQGH[HFXWLRQZHFRQVLGHUWKHSRVVLELOLW\IRU PHQW0RUHRYHUZLWKUHJDUGWRGHVLJQDQGH[HFXWLRQZHFRQVLGHUWKHSRVVLELOLW\IRU
UHGXFLQJWKHFRYHUGHSWKEDVHGRQVWDLQOHVVVWHHOUHLQIRUFHPHQWWREHRIJUHDWSUDFWLFDO UHGXFLQJWKHFRYHUGHSWKEDVHGRQVWDLQOHVVVWHHOUHLQIRUFHPHQWWREHRIJUHDWSUDFWLFDO
EHQHILW FI6HFWLRQ  EHQHILW FI6HFWLRQ 
:KLOH WKHUPRG\QDPLF FRQVLGHUDWLRQV EDVHG RQ 3RXUEDL[ GLDJUDPV DQG UHDFWLRQ :KLOH WKHUPRG\QDPLF FRQVLGHUDWLRQV EDVHG RQ 3RXUEDL[ GLDJUDPV DQG UHDFWLRQ
PHFKDQLVPDUHOLPLWHGIRUKLJKDOOR\HGPHWDOV LHIRUVWDLQOHVVVWHHO ZHWKLQNWKDW PHFKDQLVPDUHOLPLWHGIRUKLJKDOOR\HGPHWDOV LHIRUVWDLQOHVVVWHHO ZHWKLQNWKDW
FHUWDLQ WKHUPRG\QDPLF FKDUDFWHULVWLFV FDQ QRQHWKHOHVVEH LQGLFDWHG LQ DQG H[SODLQHG FHUWDLQ WKHUPRG\QDPLF FKDUDFWHULVWLFV FDQ QRQHWKHOHVVEH LQGLFDWHG LQ DQG H[SODLQHG
E\ 3RXUEDL[ GLDJUDPV LQSDUWLFXODU ZLWK UHJDUG WR WKHSDVVLYDWLRQ RI WKH DVVRFLDWHG E\ 3RXUEDL[ GLDJUDPV LQSDUWLFXODU ZLWK UHJDUG WR WKHSDVVLYDWLRQ RI WKH DVVRFLDWHG
DOOR\VDQGKHQFHSDVVLYDWLRQRIVWDLQOHVVVWHHOLQJLYHQHQYLURQPHQWV$QH[DPSOHLV DOOR\VDQGKHQFHSDVVLYDWLRQRIVWDLQOHVVVWHHOLQJLYHQHQYLURQPHQWV$QH[DPSOHLV
SUHVHQWHGLQ)LJXUHDQG)LJXUHZKLFKVKRZµ0(3'V¶RIWKHSULQFLSDODOOR\V SUHVHQWHGLQ)LJXUHDQG)LJXUHZKLFKVKRZµ0(3'V¶RIWKHSULQFLSDODOOR\V
RIJUDGHVWDLQOHVVVWHHO FI6HFWLRQ DQGWKHVXSHULPSRVLWLRQRI RIJUDGHVWDLQOHVVVWHHO FI6HFWLRQ DQGWKHVXSHULPSRVLWLRQRI
WKHVWDELOLW\GRPDLQVRIVHOHFWHGDOOR\R[LGHVRQWKH)H&O+2µ0(3'¶UHVSHFWLYHO\ WKHVWDELOLW\GRPDLQVRIVHOHFWHGDOOR\R[LGHVRQWKH)H&O+2µ0(3'¶UHVSHFWLYHO\
'HWDLOVIRUWKHVSHFLHVSUHVHOHFWHGIRUWKHHVWDEOLVKPHQWRIWKHµ0(3'V¶LQ)LJXUH 'HWDLOVIRUWKHVSHFLHVSUHVHOHFWHGIRUWKHHVWDEOLVKPHQWRIWKHµ0(3'V¶LQ)LJXUH
DUH QRW GHVFULEHG DQG UHIHUHQFH LV PDGH WR WKH PHWKRGRORJ\ GHVFULEHG LQ 6HFWLRQ DUH QRW GHVFULEHG DQG UHIHUHQFH LV PDGH WR WKH PHWKRGRORJ\ GHVFULEHG LQ 6HFWLRQ
 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

 
)LJXUH µ0(3'V¶ IRU SULQFLSDO DOOR\V RI JUDGH  >'6(1  )LJXUH µ0(3'V¶ IRU SULQFLSDO DOOR\V RI JUDGH  >'6(1 
@ >$670'6@VWDLQOHVVVWHHOLQWKH&O+2V\VWHP7KH @ >$670'6@VWDLQOHVVVWHHOLQWKH&O+2V\VWHP7KH
LRQDFWLYLWLHVRIDOOLQFOXGHGPHWDOVFRUUHVSRQGWRíPRO/DQG&OLD LRQDFWLYLWLHVRIDOOLQFOXGHGPHWDOVFRUUHVSRQGWRíPRO/DQG&OLD
  PRO/ >$@ &U&O)H1L0R µ0(3'¶ >%@ 1L&O)H&U0R   PRO/ >$@ &U&O)H1L0R µ0(3'¶ >%@ 1L&O)H&U0R
µ0(3'¶>&@0R&O)H&U1Lµ0(3'¶ µ0(3'¶>&@0R&O)H&U1Lµ0(3'¶
)LJXUH>$@UHSUHVHQWVWKHµ0(3'¶RIWKH&U&O)H1L0RV\VWHP7KLVGLDJUDP )LJXUH>$@UHSUHVHQWVWKHµ0(3'¶RIWKH&U&O)H1L0RV\VWHP7KLVGLDJUDP
FDQEHFRPSDUHGWRWKHµ0(3'¶RIWKH&U)H+2V\VWHP FI)LJXUH>&@LQ6HF FDQEHFRPSDUHGWRWKHµ0(3'¶RIWKH&U)H+2V\VWHP FI)LJXUH>&@LQ6HF
WLRQ EHFDXVHQRFRPSRXQGVLQYROYLQJQLFNHODQGPRO\EGHQXPDUHIRUPHGLQ WLRQ EHFDXVHQRFRPSRXQGVLQYROYLQJQLFNHODQGPRO\EGHQXPDUHIRUPHGLQ
WKH &U&O)H1L0R V\VWHP ZKHQ FKURPLXP LV VHOHFWHG DV WKH PDLQ HOHPHQW 7KH WKH &U&O)H1L0R V\VWHP ZKHQ FKURPLXP LV VHOHFWHG DV WKH PDLQ HOHPHQW 7KH
FRPSDULVRQVKRZVWKDWSDVVLYDWLRQRILURQ RUVWDLQOHVVVWHHO E\&U)H2FDQRQO\EH FRPSDULVRQVKRZVWKDWSDVVLYDWLRQRILURQ RUVWDLQOHVVVWHHO E\&U)H2FDQRQO\EH
PDLQWDLQHGGRZQWRDS+RIDERXWLIJ/RIFKORULGHDUHGLVVROYHGLQWKHSRUH PDLQWDLQHGGRZQWRDS+RIDERXWLIJ/RIFKORULGHDUHGLVVROYHGLQWKHSRUH
VROXWLRQFRPSDUHGWRDS+RIDURXQGIRUFKORULGHIUHHFRQFUHWH,Q)LJXUH>%@ VROXWLRQFRPSDUHGWRDS+RIDURXQGIRUFKORULGHIUHHFRQFUHWH,Q)LJXUH>%@
WKHVWDELOLW\GRPDLQRI&U)H2 DVZHOODVWKHVWDELOLW\GRPDLQVRIWKHSDVVLYDWLQJR[ WKHVWDELOLW\GRPDLQRI&U)H2 DVZHOODVWKHVWDELOLW\GRPDLQVRIWKHSDVVLYDWLQJR[
LGHVLQWKH1L&O)H&U0RV\VWHP )LJXUH>%@ DQGWKH0R&O)H&U1LV\VWHP LGHVLQWKH1L&O)H&U0RV\VWHP )LJXUH>%@ DQGWKH0R&O)H&U1LV\VWHP
)LJXUH>&@ DUHVXSHULPSRVHGRQWKHµ0(3'¶RIWKH)H&O+2V\VWHP )LJXUH>&@ DUHVXSHULPSRVHGRQWKHµ0(3'¶RIWKH)H&O+2V\VWHP
,Q )LJXUH  >%@ LW FDQ EH REVHUYHG WKDW HYHQ WKRXJK FULWLFDO UHJLRQV RI )H DQG ,Q )LJXUH  >%@ LW FDQ EH REVHUYHG WKDW HYHQ WKRXJK FULWLFDO UHJLRQV RI )H DQG
)H&O DUH FRYHUHG E\ SDVVLYDWLQJ R[LGHV VWDLQOHVV VWHHO KDV D WKHUPRG\QDPLF WHQ )H&O DUH FRYHUHG E\ SDVVLYDWLQJ R[LGHV VWDLQOHVV VWHHO KDV D WKHUPRG\QDPLF WHQ
GHQF\WRFRUURGHLQDFKORULGHHQYLURQPHQWEXWWKHFULWLFDOS+LVPRYHGDZD\IURP GHQF\WRFRUURGHLQDFKORULGHHQYLURQPHQWEXWWKHFULWLFDOS+LVPRYHGDZD\IURP
QHXWUDOLW\ WRZDUGV D S+ DURXQG  7KLV DVSHFW XQGHUOLQHV WKH LGHDO UHVLVWDQFH RI QHXWUDOLW\ WRZDUGV D S+ DURXQG  7KLV DVSHFW XQGHUOLQHV WKH LGHDO UHVLVWDQFH RI
VWDLQOHVVVWHHOWRFDUERQDWLRQLQGXFHGFRUURVLRQRQWKHRWKHUKDQGZHDOVRUHJDUGLWDV VWDLQOHVVVWHHOWRFDUERQDWLRQLQGXFHGFRUURVLRQRQWKHRWKHUKDQGZHDOVRUHJDUGLWDV
SOD\LQJDPDMRUUROHLQWKHSURSDJDWLRQVWDJHRIFKORULGHLQGXFHGUHLQIRUFHPHQWFRUUR SOD\LQJDPDMRUUROHLQWKHSURSDJDWLRQVWDJHRIFKORULGHLQGXFHGUHLQIRUFHPHQWFRUUR
VLRQVLQFHWKHWKHUPRG\QDPLFFRQGLWLRQVDWDDURXQGQHXWUDOLW\DUHGHFLVLYH FI6HF VLRQVLQFHWKHWKHUPRG\QDPLFFRQGLWLRQVDWDDURXQGQHXWUDOLW\DUHGHFLVLYH FI6HF
WLRQ +RZHYHULQFRUUHVSRQGHQFHZLWKFKORULGHLQGXFHGFRUURVLRQRIFDUERQ WLRQ +RZHYHULQFRUUHVSRQGHQFHZLWKFKORULGHLQGXFHGFRUURVLRQRIFDUERQ
VWHHOUHLQIRUFHPHQWWKHLQLWLDWLRQVWDJHLVQRWUHIOHFWHGJLYHQWKDWWKHLQYROYHGSLWWLQJ VWHHOUHLQIRUFHPHQWWKHLQLWLDWLRQVWDJHLVQRWUHIOHFWHGJLYHQWKDWWKHLQYROYHGSLWWLQJ
SRWHQWLDO LV FRQVLGHUHG WR EH D NLQHWLF SDUDPHWHU FI 6HFWLRQ   :LWK UHJDUG WR SRWHQWLDO LV FRQVLGHUHG WR EH D NLQHWLF SDUDPHWHU FI 6HFWLRQ   :LWK UHJDUG WR
SLWWLQJFRUURVLRQLWLVQRWHZRUWK\WKDWWKHµ6,3'¶LQGLFDWHVWKHUHVLVWDQFHRIVWDLQOHVV SLWWLQJFRUURVLRQLWLVQRWHZRUWK\WKDWWKHµ6,3'¶LQGLFDWHVWKHUHVLVWDQFHRIVWDLQOHVV
VWHHO WR FRUURVLRQ LQ R[LGLVLQJ DFLG HQYLURQPHQWV ZKLFK LV JHQHUDOO\ UHJDUGHG WR EH VWHHO WR FRUURVLRQ LQ R[LGLVLQJ DFLG HQYLURQPHQWV ZKLFK LV JHQHUDOO\ UHJDUGHG WR EH
LPSURYHGE\DOOR\LQJPRO\EGHQXPHJ>'DYLV0¡OOHUE@ LPSURYHGE\DOOR\LQJPRO\EGHQXPHJ>'DYLV0¡OOHUE@

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV

 
í í
)LJXUH >$@ )H&O+2 µ0(3'¶ EDVHG RQ 7DEOH  DQG )HLD    PRO/ )LJXUH >$@ )H&O+2 µ0(3'¶ EDVHG RQ 7DEOH  DQG )HLD    PRO/
DQG &OLD   PRO/ >%@ µ6,3'¶ RI VWDELOLW\ GRPDLQV RI VHOHFWHG DQG &OLD   PRO/ >%@ µ6,3'¶ RI VWDELOLW\ GRPDLQV RI VHOHFWHG
VWDLQOHVVVWHHODOOR\R[LGHVIURP)LJXUHRQ>$@2ZQFRUURVLRQSR VWDLQOHVVVWHHODOOR\R[LGHVIURP)LJXUHRQ>$@2ZQFRUURVLRQSR
WHQWLDOPHDVXUHPHQWVIURPµ7HVW,¶RISDVVLYHVWDLQOHVVVWHHOHPEHGGHG WHQWLDOPHDVXUHPHQWVIURPµ7HVW,¶RISDVVLYHVWDLQOHVVVWHHOHPEHGGHG
LQ PRUWDU ³&$´ FI 6HFWLRQ   DUH LQGLFDWHG E\ WKH WKLFN WXU LQ PRUWDU ³&$´ FI 6HFWLRQ   DUH LQGLFDWHG E\ WKH WKLFN WXU
TXRLVHEDUDQGSXWLQWRFRQWH[WZLWKWKHFRUURVLRQSRWHQWLDOVPHDVXUHG TXRLVHEDUDQGSXWLQWRFRQWH[WZLWKWKHFRUURVLRQSRWHQWLDOVPHDVXUHG
IRUSDVVLYHFDUERQVWHHOZLWKGLIIHUHQWVXUIDFHSURSHUWLHVLOOXVWUDWHGE\ IRUSDVVLYHFDUERQVWHHOZLWKGLIIHUHQWVXUIDFHSURSHUWLHVLOOXVWUDWHGE\
WKH WKLQ FRORXUHG OLQHV FI)LJXUH  >$@LQ 6HFWLRQ   ,WVKRXOG WKH WKLQ FRORXUHG OLQHV FI)LJXUH  >$@LQ 6HFWLRQ   ,WVKRXOG
EHQRWHGWKDWWKHXQGHUO\LQJDUHDVRIWKH)H&O+2µ0(3'¶DUHQRW EHQRWHGWKDWWKHXQGHUO\LQJDUHDVRIWKH)H&O+2µ0(3'¶DUHQRW
VKDGHGDVRQO\WKHSDVVLYHGRPDLQVDUHVXSHULPSRVHG VKDGHGDVRQO\WKHSDVVLYHGRPDLQVDUHVXSHULPSRVHG
)LQDOO\ )LJXUH  >%@ DOVR H[HPSOLILHV RZQ µ(FRUU¶ PHDVXUHPHQWV IURP µ7HVW,¶ RI )LQDOO\ )LJXUH  >%@ DOVR H[HPSOLILHV RZQ µ(FRUU¶ PHDVXUHPHQWV IURP µ7HVW,¶ RI
SDVVLYHVWDLQOHVVVWHHOHPEHGGHGLQPRUWDU$FRPSDULVRQWRWKHFRUURVLRQSRWHQWLDOV SDVVLYHVWDLQOHVVVWHHOHPEHGGHGLQPRUWDU$FRPSDULVRQWRWKHFRUURVLRQSRWHQWLDOV
PHDVXUHGIRUSDVVLYHFDUERQVWHHOZLWKGLIIHUHQWVXUIDFHSURSHUWLHV FI)LJXUH>$@ PHDVXUHGIRUSDVVLYHFDUERQVWHHOZLWKGLIIHUHQWVXUIDFHSURSHUWLHV FI)LJXUH>$@
LQ6HFWLRQ LOOXVWUDWHVWKH WKHUPRG\QDPLF FRPSDWLELOLW\ ZKLFKLVRIPDMRULP LQ6HFWLRQ LOOXVWUDWHVWKH WKHUPRG\QDPLF FRPSDWLELOLW\ ZKLFKLVRIPDMRULP
SRUWDQFHZLWKUHJDUGWRVHOHFWLYHXVHRIVWDLQOHVVVWHHOLQFOXGLQJHOHFWULFDOFRQQHFWLRQ SRUWDQFHZLWKUHJDUGWRVHOHFWLYHXVHRIVWDLQOHVVVWHHOLQFOXGLQJHOHFWULFDOFRQQHFWLRQ
WRFDUERQVWHHOUHLQIRUFHPHQW>.OLQJKRIIHU5RVWDP5RVWDP@ WRFDUERQVWHHOUHLQIRUFHPHQW>.OLQJKRIIHU5RVWDP5RVWDP@

 ([SHULPHQWDO,QYHVWLJDWLRQVRQ0HWDOOXUJLFDO3URSHUWLHV  ([SHULPHQWDO,QYHVWLJDWLRQVRQ0HWDOOXUJLFDO3URSHUWLHV


,Q FRUUHVSRQGHQFH ZLWK WKH PHWDOOXUJLFDO LQYHVWLJDWLRQV RQ FDUERQ VWHHO FI 6HFWLRQ ,Q FRUUHVSRQGHQFH ZLWK WKH PHWDOOXUJLFDO LQYHVWLJDWLRQV RQ FDUERQ VWHHO FI 6HFWLRQ
  WKH PHWDOOXUJLFDO SURSHUWLHV RI JUDGH  >'6(1    WKH PHWDOOXUJLFDO SURSHUWLHV RI JUDGH  >'6(1 
@>$670'6@ULEEHGVWDLQOHVVVWHHOUHEDUZLWKDVSHFLILHG&U1L0R @>$670'6@ULEEHGVWDLQOHVVVWHHOUHEDUZLWKDVSHFLILHG&U1L0R
FRQWHQW RI  >/0* E@ ZHUH LQYHVWLJDWHG E\ µ/20¶ µ6(0¶ DQG FRQWHQW RI  >/0* E@ ZHUH LQYHVWLJDWHG E\ µ/20¶ µ6(0¶ DQG
µ('6¶ 6HOHFWHG UHVXOWV DUH VXPPDULVHG DIWHU D VKRUW QRWH RQ WKHVDPSOHSUHSDUDWLRQ µ('6¶ 6HOHFWHG UHVXOWV DUH VXPPDULVHG DIWHU D VKRUW QRWH RQ WKHVDPSOHSUHSDUDWLRQ
DQGPHDVXUHPHQWWHFKQLTXHV DQGPHDVXUHPHQWWHFKQLTXHV
‡ 6DPSOHSUHSDUDWLRQDQGPHDVXUHPHQWWHFKQLTXHV ‡ 6DPSOHSUHSDUDWLRQDQGPHDVXUHPHQWWHFKQLTXHV
7KH PHWDOORJUDSKLF VDPSOH FRQWDLQLQJ FURVV DQG ORQJLWXGLQDO VHFWLRQV RI DV 7KH PHWDOORJUDSKLF VDPSOH FRQWDLQLQJ FURVV DQG ORQJLWXGLQDO VHFWLRQV RI DV
UHFHLYHGVWDLQOHVVVWHHOUHEDUZLWKDGLDPHWHURIPPZDVSUHSDUHGE\PHDQVRID UHFHLYHGVWDLQOHVVVWHHOUHEDUZLWKDGLDPHWHURIPPZDVSUHSDUHGE\PHDQVRID
VXLWDEOH JULQGLQJ DQG SROLVKLQJ VHTXHQFH DFFRUGLQJ WR >%MHUUHJDDUG HWDO @ VXLWDEOH JULQGLQJ DQG SROLVKLQJ VHTXHQFH DFFRUGLQJ WR >%MHUUHJDDUG HWDO @
µ/20¶ZDVSHUIRUPHGRQWKHVSHFLPHQEHIRUHDQGDIWHUHOHFWURFKHPLFDOO\HWFKLQJ µ/20¶ZDVSHUIRUPHGRQWKHVSHFLPHQEHIRUHDQGDIWHUHOHFWURFKHPLFDOO\HWFKLQJ
ZLWK  R[DOLF DFLG DV GHVFULEHG LQ >:HLGPDQQ HWDO @ ,Q DGGLWLRQ WR ZLWK  R[DOLF DFLG DV GHVFULEHG LQ >:HLGPDQQ HWDO @ ,Q DGGLWLRQ WR

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

µ/20¶ WKH PHWDOOXUJLFDO SURSHUWLHV RI WKH VSHFLPHQ KDYH EHHQ LQYHVWLJDWHG E\ µ/20¶ WKH PHWDOOXUJLFDO SURSHUWLHV RI WKH VSHFLPHQ KDYH EHHQ LQYHVWLJDWHG E\
µ6(0¶DQGµ('6¶DFFRUGLQJWR>$670(@DQG>$670(@ µ6(0¶DQGµ('6¶DFFRUGLQJWR>$670(@DQG>$670(@
UHVSHFWLYHO\%HIRUHµ6(0¶DQGµ('6¶DQDO\VHVDFRQGXFWLQJWKLQILOPRIFDUERQ UHVSHFWLYHO\%HIRUHµ6(0¶DQGµ('6¶DQDO\VHVDFRQGXFWLQJWKLQILOPRIFDUERQ
ZDVDSSOLHGRQWKHVXUIDFHRIWKHPHWDOORJUDSKLFVSHFLPHQ ZDVDSSOLHGRQWKHVXUIDFHRIWKHPHWDOORJUDSKLFVSHFLPHQ
‡ /LJKW2SWLFDO0LFURVFRS\ ‡ /LJKW2SWLFDO0LFURVFRS\
,QFRQWUDVWWRWKHLQYHVWLJDWHGFDUERQVWHHOVDPSOH FI6HFWLRQ µ/20¶RQ ,QFRQWUDVWWRWKHLQYHVWLJDWHGFDUERQVWHHOVDPSOH FI6HFWLRQ µ/20¶RQ
WKHXQHWFKHGVWDLQOHVVVWHHOVDPSOHVKRZHGFOHDUVXUIDFHVDQGDFFRUGLQJO\QRLQGL WKHXQHWFKHGVWDLQOHVVVWHHOVDPSOHVKRZHGFOHDUVXUIDFHVDQGDFFRUGLQJO\QRLQGL
FDWLRQVIRULQFOXVLRQVZKLFKZDVFRQILUPHGE\WKHµ/20¶RIWKHHWFKHGFURVVVHF FDWLRQVIRULQFOXVLRQVZKLFKZDVFRQILUPHGE\WKHµ/20¶RIWKHHWFKHGFURVVVHF
WLRQVVHH)LJXUH WLRQVVHH)LJXUH

 
)LJXUH /LJKWRSWLFDOPLFURVFRS\RIXQHWFKHGFURVVVHFWLRQRIVWDLQOHVVVWHHO )LJXUH /LJKWRSWLFDOPLFURVFRS\RIXQHWFKHGFURVVVHFWLRQRIVWDLQOHVVVWHHO
VDPSOH>$@0LGGOH>%@(GJHRI³EXON´>&@(GJHRIULE VDPSOH>$@0LGGOH>%@(GJHRI³EXON´>&@(GJHRIULE
$OOSKRWRJUDSKVSUHVHQWWKHH[SHFWHGVOLJKWO\GHIRUPHGDXVWHQLWLFJUDLQVWUXFWXUH $OOSKRWRJUDSKVSUHVHQWWKHH[SHFWHGVOLJKWO\GHIRUPHGDXVWHQLWLFJUDLQVWUXFWXUH
7KH KRUL]RQWDO OLQHV LQ )LJXUH  >$@ DUH D UHVXOW RI WKH VDPSOH SUHSDUDWLRQ 7KH KRUL]RQWDO OLQHV LQ )LJXUH  >$@ DUH D UHVXOW RI WKH VDPSOH SUHSDUDWLRQ
SUREDEO\UHPDLQVIURPWKHJULQGLQJDQGSROLVKLQJSURFHVV)LJXUH>%@VKRZV SUREDEO\UHPDLQVIURPWKHJULQGLQJDQGSROLVKLQJSURFHVV)LJXUH>%@VKRZV
DQHYHQO\GHIRUPHGVXUIDFHDWWKHHGJHRIWKHEXONRIWKHVWDLQOHVVEDUZKHUHDVDQ DQHYHQO\GHIRUPHGVXUIDFHDWWKHHGJHRIWKHEXONRIWKHVWDLQOHVVEDUZKHUHDVDQ
XQHYHQVXUIDFHGHIRUPDWLRQIURPUROOLQJLVH[KLELWHGDWWKHHGJHRIDULELQ)LJXUH XQHYHQVXUIDFHGHIRUPDWLRQIURPUROOLQJLVH[KLELWHGDWWKHHGJHRIDULELQ)LJXUH
>&@ >&@
‡ 6FDQQLQJ(OHFWURQ0LFURVFRS\ ‡ 6FDQQLQJ(OHFWURQ0LFURVFRS\
)LJXUH  LV D SKRWRJUDSK IURP WKH VHFRQGDU\ HOHFWURQ µ6(0¶ DQDO\VLV RQ WKH )LJXUH  LV D SKRWRJUDSK IURP WKH VHFRQGDU\ HOHFWURQ µ6(0¶ DQDO\VLV RQ WKH
HGJHRIWKHHWFKHGORQJLWXGLQDO VHFWLRQRIWKHVWDLQOHVVUHEDU 6XUIDFH GHIHFWV UH HGJHRIWKHHWFKHGORQJLWXGLQDO VHFWLRQRIWKHVWDLQOHVVUHEDU 6XUIDFH GHIHFWV UH
VXOWLQJIURPRYHUUROOLQJRIWKHVHFWLRQDUHYLVLEOH:HFRQVLGHUVXFKPLFURFUDFNV VXOWLQJIURPRYHUUROOLQJRIWKHVHFWLRQDUHYLVLEOH:HFRQVLGHUVXFKPLFURFUDFNV
WREHFUXFLDOIRUFRUURVLRQLQLWLDWLRQDQGWKH\DUHWKHUHIRUHFRQVLGHUHGWRUHSUH WREHFUXFLDOIRUFRUURVLRQLQLWLDWLRQDQGWKH\DUHWKHUHIRUHFRQVLGHUHGWRUHSUH
VHQWDZHDNVSRWRIWKHVWDLQOHVVEDUVXUIDFH VHQWDZHDNVSRWRIWKHVWDLQOHVVEDUVXUIDFH

 
)LJXUH 6HFRQGDU\HOHFWURQVFDQQLQJHOHFWURQPLFURVFRS\RIWKHHGJHRIWKH )LJXUH 6HFRQGDU\HOHFWURQVFDQQLQJHOHFWURQPLFURVFRS\RIWKHHGJHRIWKH
HWFKHGORQJLWXGLQDOVHFWLRQRIWKHVWDLQOHVVUHEDU HWFKHGORQJLWXGLQDOVHFWLRQRIWKHVWDLQOHVVUHEDU

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV

‡ (QHUJ\'LVSHUVLYH;5D\6SHFWURVFRS\ ‡ (QHUJ\'LVSHUVLYH;5D\6SHFWURVFRS\
5HTXLUHG VSHFLILHG >/0* E@ DQG DYHUDJHG PHDVXUHG TXDQWLWLHVIRUWKHLQ 5HTXLUHG VSHFLILHG >/0* E@ DQG DYHUDJHG PHDVXUHG TXDQWLWLHVIRUWKHLQ
YHVWLJDWHGVWDLQOHVVVWHHOVDPSOHDUHVXPPDULVHGLQ7DEOH7KHPHDVXUHGYDO YHVWLJDWHGVWDLQOHVVVWHHOVDPSOHDUHVXPPDULVHGLQ7DEOH7KHPHDVXUHGYDO
XHVDUHWDNHQIURPWKHDYHUDJHRIWKHµ('6¶VSHFWUDIURPWKHPLGGOHDQGFORVHWR XHVDUHWDNHQIURPWKHDYHUDJHRIWKHµ('6¶VSHFWUDIURPWKHPLGGOHDQGFORVHWR
WKHHGJHRIWKHORQJLWXGLQDOVHFWLRQ WKHHGJHRIWKHORQJLWXGLQDOVHFWLRQ
7DEOH 5HTXLUHG VSHFLILHG >/0* E@ DQG DYHUDJHG PHDVXUHG FRP 7DEOH 5HTXLUHG VSHFLILHG >/0* E@ DQG DYHUDJHG PHDVXUHG FRP
SRVLWLRQRILQYHVWLJDWHGVWDLQOHVVVWHHOVDPSOH µ//¶ /RQJLWXGLQDO SRVLWLRQRILQYHVWLJDWHGVWDLQOHVVVWHHOVDPSOH µ//¶ /RQJLWXGLQDO
VHFWLRQ VHFWLRQ

5HTXLUHG 6SHFLILHG $YHUDJHG $YHUDJHG 5HTXLUHG 6SHFLILHG $YHUDJHG $YHUDJHG


PHDVXUHG PHDVXUHG PHDVXUHG PHDVXUHG
(OHPHQW >/0*E@ >/0*E@ µ//¶ PLGGOH µ//¶ HGJH (OHPHQW >/0*E@ >/0*E@ µ//¶ PLGGOH µ//¶ HGJH
>@ >@ >@ >@ >@ >@ >@ >@
,URQ     ,URQ    
&KURPLXP     &KURPLXP    
1LFNHO     1LFNHO    
0RO\EGHQXP     0RO\EGHQXP    
0DQJDQHVH ”    0DQJDQHVH ”   
6LOLFRQ ”    6LOLFRQ ”   
1LWURJHQ ”    1LWURJHQ ”   
&DUERQ ”    &DUERQ ”   
3KRVSKRUXV ”    3KRVSKRUXV ”   
6XOSKXU ”    6XOSKXU ”   

 0HWDOOLF&ODGGLQJRI5HLQIRUFHPHQW  0HWDOOLF&ODGGLQJRI5HLQIRUFHPHQW


$QRWKHU DSSURDFK LQ LPSURYLQJ WKH FRUURVLRQ UHVLVWDQFH RI UHLQIRUFHPHQW LV WR FODG $QRWKHU DSSURDFK LQ LPSURYLQJ WKH FRUURVLRQ UHVLVWDQFH RI UHLQIRUFHPHQW LV WR FODG
FDUERQVWHHOUHEDUVZLWKVWDLQOHVVVWHHORURWKHUPHWDOVDQGDOOR\VZLWKLPSURYHGFRU FDUERQVWHHOUHEDUVZLWKVWDLQOHVVVWHHORURWKHUPHWDOVDQGDOOR\VZLWKLPSURYHGFRU
URVLRQUHVLVWDQFH%DVHGRQWKHHOHFWURFKHPLFDOFRPSDWLELOLW\ FI6HFWLRQ ZH URVLRQUHVLVWDQFH%DVHGRQWKHHOHFWURFKHPLFDOFRPSDWLELOLW\ FI6HFWLRQ ZH
FRQVLGHUVWDLQOHVVVWHHOFODGGLQJDVDIHDVLEOHVROXWLRQEXWH[SHULHQFHVKRZVWKDWUH FRQVLGHUVWDLQOHVVVWHHOFODGGLQJDVDIHDVLEOHVROXWLRQEXWH[SHULHQFHVKRZVWKDWUH
GXFWLRQV LQ FRVWV KDYH QRW EHHQ VXIILFLHQW WR PDNH FODGGLQJ DQ DWWUDFWLYH RSWLRQ GXFWLRQV LQ FRVWV KDYH QRW EHHQ VXIILFLHQW WR PDNH FODGGLQJ DQ DWWUDFWLYH RSWLRQ
>&KRZGKXU\ @ +RZHYHU D QHZ VSUD\ FRDWLQJ SURFHVV IRU PDQXIDFWXUH RI >&KRZGKXU\ @ +RZHYHU D QHZ VSUD\ FRDWLQJ SURFHVV IRU PDQXIDFWXUH RI
VWDLQOHVVVWHHOFODGGLQJVHHPVWRSURYLGHIRUVDYLQJVLQWKDWUHVSHFW>&KHVQH\@ VWDLQOHVVVWHHOFODGGLQJVHHPVWRSURYLGHIRUVDYLQJVLQWKDWUHVSHFW>&KHVQH\@
2WKHUFODGGLQJPDWHULDOVKDYHEHHQSURSRVHGDQGLQYHVWLJDWHGLQWKHSDVWEXWWRRXU 2WKHUFODGGLQJPDWHULDOVKDYHEHHQSURSRVHGDQGLQYHVWLJDWHGLQWKHSDVWEXWWRRXU
NQRZOHGJH QHYHU HQWHUHG WKH GXUDELOLW\ GHVLJQ PDUNHW RQ D FRQVLGHUDEOH VFDOH )RU NQRZOHGJH QHYHU HQWHUHG WKH GXUDELOLW\ GHVLJQ PDUNHW RQ D FRQVLGHUDEOH VFDOH )RU
LQVWDQFH QLFNHO DQG FRSSHU ZKLFK DUH NQRZQ WR SURYLGH FRUURVLRQ UHVLVWDQFH XQGHU LQVWDQFH QLFNHO DQG FRSSHU ZKLFK DUH NQRZQ WR SURYLGH FRUURVLRQ UHVLVWDQFH XQGHU
FKORULGHH[SRVXUHKDYHEHHQSURSRVHGDVFODGGLQJPDWHULDOVHJ>7ULSOHUHWDO FKORULGHH[SRVXUHKDYHEHHQSURSRVHGDVFODGGLQJPDWHULDOVHJ>7ULSOHUHWDO
%DNHU @ DQG >0F'RQDOG HWDO @ UHVSHFWLYHO\ ,Q WKH UHODWHG VWXGLHV ERWK %DNHU @ DQG >0F'RQDOG HWDO @ UHVSHFWLYHO\ ,Q WKH UHODWHG VWXGLHV ERWK
QLFNHODQGFRSSHUFODGGHGUHEDUVVKRZHGVLJQLILFDQWO\LPSURYHGFRUURVLRQUHVLVWDQFH QLFNHODQGFRSSHUFODGGHGUHEDUVVKRZHGVLJQLILFDQWO\LPSURYHGFRUURVLRQUHVLVWDQFH
LQFKORULGHFRQWDPLQDWHGFRQFUHWH>7ULSOHUHWDO%DNHU0F'RQDOGHWDO LQFKORULGHFRQWDPLQDWHGFRQFUHWH>7ULSOHUHWDO%DNHU0F'RQDOGHWDO
@+RZHYHUEHVLGHVWKDWWKHDFWXDOVDYLQJVDFKLHYHGZLWKWKHVHWHFKQLTXHV HVSH @+RZHYHUEHVLGHVWKDWWKHDFWXDOVDYLQJVDFKLHYHGZLWKWKHVHWHFKQLTXHV HVSH
FLDOO\ZLWKQLFNHOFODGGLQJ DUHXQFHUWDLQDQGWKDWFRSSHULVNQRZQWRUHWDUGFHPHQW FLDOO\ZLWKQLFNHOFODGGLQJ DUHXQFHUWDLQDQGWKDWFRSSHULVNQRZQWRUHWDUGFHPHQW
K\GUDWLRQ ZH WKLQN WKDW WKHVH WHFKQLTXHV KDYH PDMRU SUDFWLFDO DQG WKHUPRG\QDPLF K\GUDWLRQ ZH WKLQN WKDW WKHVH WHFKQLTXHV KDYH PDMRU SUDFWLFDO DQG WKHUPRG\QDPLF

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

GLVDGYDQWDJHV$VLWLOOXVWUDWHGLQµ6,3'V¶RIWKH1L&O+2µ0(3'¶LQ)LJXUH GLVDGYDQWDJHV$VLWLOOXVWUDWHGLQµ6,3'V¶RIWKH1L&O+2µ0(3'¶LQ)LJXUH
>$@DQGWKH&X&O+2µ0(3'¶LQ)LJXUH>%@ZKLFKDUHERWKVXSHULPSRVHGRQ >$@DQGWKH&X&O+2µ0(3'¶LQ)LJXUH>%@ZKLFKDUHERWKVXSHULPSRVHGRQ
WKH)H&O+2V\VWHPERWKQLFNHODQGFRSSHUSURYLGHLPSURYHGFRUURVLRQUHVLVWDQFH WKH)H&O+2V\VWHPERWKQLFNHODQGFRSSHUSURYLGHLPSURYHGFRUURVLRQUHVLVWDQFH
LQWKHFKORULGHHQYLURQPHQWFRPSDUHGWRFDUERQVWHHO  LQWKHFKORULGHHQYLURQPHQWFRPSDUHGWRFDUERQVWHHO 

 
)LJXUH >$@µ6,3'¶RI1L&O+2µ0(3'¶ZLWK1LLD íPRO/DQG&OLD  )LJXUH >$@µ6,3'¶RI1L&O+2µ0(3'¶ZLWK1LLD íPRO/DQG&OLD 
PRO/ RQ )H&O+2 µ0(3'¶ ZLWK )HLD  í PRO/ DQG &OLD  PRO/ RQ )H&O+2 µ0(3'¶ ZLWK )HLD  í PRO/ DQG &OLD 
PRO/ >%@ µ6,3'¶ RI &X&O+2 µ0(3'¶ ZLWK &XLD  í PRO/ PRO/ >%@ µ6,3'¶ RI &X&O+2 µ0(3'¶ ZLWK &XLD  í PRO/
DQG&OLD PRO/RQ)H&O+2µ0(3'¶ZLWK)HLD íPRO/DQG DQG&OLD PRO/RQ)H&O+2µ0(3'¶ZLWK)HLD íPRO/DQG
&OLD PRO/ &OLD PRO/
+RZHYHUDQ\GHIHFWLQWKHFODGGLQJZKHUHFDUERQVWHHOLVH[SRVHGWRWKHHOHFWURO\WH +RZHYHUDQ\GHIHFWLQWKHFODGGLQJZKHUHFDUERQVWHHOLVH[SRVHGWRWKHHOHFWURO\WH
OHDGV WR LQFUHDVHG FRUURVLRQ RI WKH FDUERQ VWHHO EHFDXVH WKH µ(FRUU¶ HVWDEOLVKHG EH OHDGV WR LQFUHDVHG FRUURVLRQ RI WKH FDUERQ VWHHO EHFDXVH WKH µ(FRUU¶ HVWDEOLVKHG EH
WZHHQWKHQREOHUFODGGLQJDQGWKHVWHHOOHDGVWRDQRGLFSRODULVDWLRQRIWKHFDUERQVWHHO WZHHQWKHQREOHUFODGGLQJDQGWKHVWHHOOHDGVWRDQRGLFSRODULVDWLRQRIWKHFDUERQVWHHO
FI 6HFWLRQ   ZKLFK FDQ EH SDUWLFXODUO\ GDQJHURXV ZLWK UHJDUG WR FKORULGH LQ FI 6HFWLRQ   ZKLFK FDQ EH SDUWLFXODUO\ GDQJHURXV ZLWK UHJDUG WR FKORULGH LQ
GXFHGFRUURVLRQ)URP)LJXUHLWFDQEHFRQFOXGHGWKDWWKHFRUURVLRQUDWHDWGH GXFHGFRUURVLRQ)URP)LJXUHLWFDQEHFRQFOXGHGWKDWWKHFRUURVLRQUDWHDWGH
IHFWVLQQLFNHOFODGGLQJPLJKWQRWEHFRQVLGHUDEO\LQFUHDVHGEXWZHFRQVLGHUFRUUR IHFWVLQQLFNHOFODGGLQJPLJKWQRWEHFRQVLGHUDEO\LQFUHDVHGEXWZHFRQVLGHUFRUUR
VLRQLQGHIHFWVRIFRSSHUFODGGLQJWREHGUDVWLFDOO\DFFHOHUDWHG7KXVIURPDSUDFWLFDO VLRQLQGHIHFWVRIFRSSHUFODGGLQJWREHGUDVWLFDOO\DFFHOHUDWHG7KXVIURPDSUDFWLFDO
SRLQWRIYLHZWKHVDPHUHVWULFWLRQVDSSO\IRUUHLQIRUFHPHQWFODGGHGZLWKQLFNHODQG SRLQWRIYLHZWKHVDPHUHVWULFWLRQVDSSO\IRUUHLQIRUFHPHQWFODGGHGZLWKQLFNHODQG
FRSSHU DV GLVFXVVHG IRU HSR[\FRDWHG UHLQIRUFHPHQW FI 6HFWLRQ   LH QLFNHO FRSSHU DV GLVFXVVHG IRU HSR[\FRDWHG UHLQIRUFHPHQW FI 6HFWLRQ   LH QLFNHO
DQGFRSSHUFODGGHGEDUVFDQQRWEHDGMXVWHGRQVLWH<HWZHDVVXPHWKDWDYRLGDQFHRI DQGFRSSHUFODGGHGEDUVFDQQRWEHDGMXVWHGRQVLWH<HWZHDVVXPHWKDWDYRLGDQFHRI
LQLWLDO GHIHFWV LV IHDVLEOH IRU PHWDOOLF FODGGLQJ DQG WKDW FODGGLQJ SURYLGHV PRUH UR LQLWLDO GHIHFWV LV IHDVLEOH IRU PHWDOOLF FODGGLQJ DQG WKDW FODGGLQJ SURYLGHV PRUH UR
EXVWQHVVZLWKUHJDUGWRWKHJHQHUDOFRQVWUXFWLRQSUDFWLFHV2QWKHRWKHUKDQGFODGGLQJ EXVWQHVVZLWKUHJDUGWRWKHJHQHUDOFRQVWUXFWLRQSUDFWLFHV2QWKHRWKHUKDQGFODGGLQJ
RISUHPDQXIDFWXUHGUHLQIRUFHPHQWPHVKHVRUEDVNHWVLH'RU'FODGGLQJ FI6HF RISUHPDQXIDFWXUHGUHLQIRUFHPHQWPHVKHVRUEDVNHWVLH'RU'FODGGLQJ FI6HF
WLRQ PLJKWEHIHDVLEOHEXWGHILQLWHO\QRWFRVWHIILFLHQW WLRQ PLJKWEHIHDVLEOHEXWGHILQLWHO\QRWFRVWHIILFLHQW

 

$OWKRXJKWKHVHµ6,3'V¶GRDFFRXQWIRUDOOJDOYDQLFHIIHFWVEHWZHHQWKHPHWDOVLQWKHWZRLQYHVWLJDWHG $OWKRXJKWKHVHµ6,3'V¶GRDFFRXQWIRUDOOJDOYDQLFHIIHFWVEHWZHHQWKHPHWDOVLQWKHWZRLQYHVWLJDWHG
V\VWHPZHFRQVLGHUWKLVUHSUHVHQWDWLRQWREHIDUPRUHFRPSUHKHQVLYHDQGPHDQLQJIXOIRUFRQFOX V\VWHPZHFRQVLGHUWKLVUHSUHVHQWDWLRQWREHIDUPRUHFRPSUHKHQVLYHDQGPHDQLQJIXOIRUFRQFOX
VLRQVUHJDUGLQJWKHWKHUPRG\QDPLFFRQGLWLRQVRIDV\VWHPWKDQWKHµ(0)¶VHULHVRUWKHJDOYDQLFVH VLRQVUHJDUGLQJWKHWKHUPRG\QDPLFFRQGLWLRQVRIDV\VWHPWKDQWKHµ(0)¶VHULHVRUWKHJDOYDQLFVH
ULHV ULHV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV

 *DOYDQLVHG5HLQIRUFHPHQW  *DOYDQLVHG5HLQIRUFHPHQW


7KHWKHRUHWLFDOEDFNJURXQGRIJDOYDQLVHGUHLQIRUFHPHQWLVVXPPDULVHGLQWKLV6HFWLRQ 7KHWKHRUHWLFDOEDFNJURXQGRIJDOYDQLVHGUHLQIRUFHPHQWLVVXPPDULVHGLQWKLV6HFWLRQ
DQGH[WHQGHGZLWKUHJDUGWRWKHWKHUPRG\QDPLFFKDUDFWHULVWLFVRI]LQFLQFRQFUHWHLQ DQGH[WHQGHGZLWKUHJDUGWRWKHWKHUPRG\QDPLFFKDUDFWHULVWLFVRI]LQFLQFRQFUHWHLQ
6HFWLRQVLQFH]LQFLVDFHQWUDOFRPSRXQGLQWKHSURSRVHGQHZFRXQWHUPHDVXUHV 6HFWLRQVLQFH]LQFLVDFHQWUDOFRPSRXQGLQWKHSURSRVHGQHZFRXQWHUPHDVXUHV
7KHSHUIRUPDQFHRIJDOYDQLVHGVWHHOXQGHUDWPRVSKHULFFRQGLWLRQVLVZHOOXQGHUVWRRG 7KHSHUIRUPDQFHRIJDOYDQLVHGVWHHOXQGHUDWPRVSKHULFFRQGLWLRQVLVZHOOXQGHUVWRRG
DQG LW LV LQ H[WHQVLYHO\ XVHG IRU PDQLIROG DSSOLFDWLRQV 7KH H[WHQVLYH XVH RI ]LQF LV DQG LW LV LQ H[WHQVLYHO\ XVHG IRU PDQLIROG DSSOLFDWLRQV 7KH H[WHQVLYH XVH RI ]LQF LV
GXH WR LWV WZRIROG QDWXUH DV D FRDWLQJ )LUVWO\ DV D EDUULHU FRDWLQJ JDOYDQLVLQJ SUR GXH WR LWV WZRIROG QDWXUH DV D FRDWLQJ )LUVWO\ DV D EDUULHU FRDWLQJ JDOYDQLVLQJ SUR
YLGHV D WRXJK PHWDOOXUJLFDOO\ ERQGHG FRDWLQJ LQ FRQWUDVW WR HJ HSR[\FRDWLQJ FI YLGHV D WRXJK PHWDOOXUJLFDOO\ ERQGHG FRDWLQJ LQ FRQWUDVW WR HJ HSR[\FRDWLQJ FI
6HFWLRQ 6HFRQGO\WKHVDFULILFLDODFWLRQRI]LQFSURWHFWVWKHVWHHOHYHQZKHUH 6HFWLRQ 6HFRQGO\WKHVDFULILFLDODFWLRQRI]LQFSURWHFWVWKHVWHHOHYHQZKHUH
GDPDJH RU PLQRU GLVFRQWLQXLW\ RFFXUV LQ WKH FRDWLQJ LQ FRQWUDVW WR HJ QLFNHO DQG GDPDJH RU PLQRU GLVFRQWLQXLW\ RFFXUV LQ WKH FRDWLQJ LQ FRQWUDVW WR HJ QLFNHO DQG
FRSSHUFODGGLQJFI6HFWLRQ ZKLOHWKHFRQVXPSWLRQUDWHRIWKH]LQFLWVHOILV FRSSHUFODGGLQJFI6HFWLRQ ZKLOHWKHFRQVXPSWLRQUDWHRIWKH]LQFLWVHOILV
UHODWLYHO\ ORZ FI H[FKDQJH FXUUHQW GHQVLW\ RI ]LQF LQ 6HFWLRQ   6LPLODU WR HS UHODWLYHO\ ORZ FI H[FKDQJH FXUUHQW GHQVLW\ RI ]LQF LQ 6HFWLRQ   6LPLODU WR HS
R[\FRDWHGUHLQIRUFHPHQWJDOYDQLVHGLH]LQFFRDWHGUHLQIRUFHPHQWLVQRWVWDQGDUG R[\FRDWHGUHLQIRUFHPHQWJDOYDQLVHGLH]LQFFRDWHGUHLQIRUFHPHQWLVQRWVWDQGDUG
LVHGE\&(1EXWE\ ,62>,62@DQG$670>$670$0@,Q LVHGE\&(1EXWE\ ,62>,62@DQG$670>$670$0@,Q
DGGLWLRQWRWKHJHQHUDOO\EURDGFKDSWHUVLQWKHWH[WERRNVOLVWHGLQ6HFWLRQDQXP DGGLWLRQWRWKHJHQHUDOO\EURDGFKDSWHUVLQWKHWH[WERRNVOLVWHGLQ6HFWLRQDQXP
EHU RI RWKHU FRPSUHKHQVLYH SXEOLFDWLRQV FRQFHUQLQJ JDOYDQLVHG VWHHO DUH DYDLODEOH EHU RI RWKHU FRPSUHKHQVLYH SXEOLFDWLRQV FRQFHUQLQJ JDOYDQLVHG VWHHO DUH DYDLODEOH
HJ>ILED)UDWHVLD<HRPDQV@ HJ>ILED)UDWHVLD<HRPDQV@
*DOYDQLVHGUHEDUVKDYHEHHQLQWURGXFHGLQWKH86DERXWILIW\\HDUVDJRZKHUHDERXW *DOYDQLVHGUHEDUVKDYHEHHQLQWURGXFHGLQWKH86DERXWILIW\\HDUVDJRZKHUHDERXW
RIWKHUHLQIRUFHPHQWLVJDOYDQLVHGQRZDGD\VWKHHVWLPDWHIRU(XURSHLVDERXW RIWKHUHLQIRUFHPHQWLVJDOYDQLVHGQRZDGD\VWKHHVWLPDWHIRU(XURSHLVDERXW
>)UDWHVLE@,QFRQWUDVWWRWKHHOHFWURSODWLQJSURFHVVZKLFKZDVDSSOLHGIRUJDO >)UDWHVLE@,QFRQWUDVWWRWKHHOHFWURSODWLQJSURFHVVZKLFKZDVDSSOLHGIRUJDO
YDQLVDWLRQ LQ WKH H[SHULPHQWDO SDUW RI WKLV SURMHFW FI 6HFWLRQV  DQG   UHLQ YDQLVDWLRQ LQ WKH H[SHULPHQWDO SDUW RI WKLV SURMHFW FI 6HFWLRQV  DQG   UHLQ
IRUFHPHQWLVJHQHUDOO\KRWGLSJDOYDQLVHGLQSUDFWLFH,QSULQFLSOHWKHKRWGLSJDOYDQL IRUFHPHQWLVJHQHUDOO\KRWGLSJDOYDQLVHGLQSUDFWLFH,QSULQFLSOHWKHKRWGLSJDOYDQL
VDWLRQSURFHVVFRQVLVWVRIWKUHHVWHSVVXUIDFHSUHSDUDWLRQJDOYDQLVLQJDQGLQVSHFWLRQ VDWLRQSURFHVVFRQVLVWVRIWKUHHVWHSVVXUIDFHSUHSDUDWLRQJDOYDQLVLQJDQGLQVSHFWLRQ
7KH VXUIDFH SUHSDUDWLRQ LV RIWHQ EDVHG RQ VLPLODU SURFHVVHV DV GHVFULEHG LQ 6HFWLRQ 7KH VXUIDFH SUHSDUDWLRQ LV RIWHQ EDVHG RQ VLPLODU SURFHVVHV DV GHVFULEHG LQ 6HFWLRQ
 EXW FDQ DOVR EH DFFRPSOLVKHG E\ PHFKDQLFDO FOHDQLQJ LQ FRPELQDWLRQ ZLWK  EXW FDQ DOVR EH DFFRPSOLVKHG E\ PHFKDQLFDO FOHDQLQJ LQ FRPELQDWLRQ ZLWK
FKHPLFDOSURFHVVHV$IWHUWKHSUHSDUDWLRQWKHFDUERQVWHHOUHLQIRUFHPHQWLVLPPHUVHG FKHPLFDOSURFHVVHV$IWHUWKHSUHSDUDWLRQWKHFDUERQVWHHOUHLQIRUFHPHQWLVLPPHUVHG
LQDEDWKRIPROWHQ]LQF7\SLFDOO\WKH]LQFEDWKLVDWWHPSHUDWXUHVDERYHƒ&DQG LQDEDWKRIPROWHQ]LQF7\SLFDOO\WKH]LQFEDWKLVDWWHPSHUDWXUHVDERYHƒ&DQG
FRQVLVWVRISXUH]LQF>$*$$*$@7KLVSURFHVVSURGXFHVDPHWDOOLF FRQVLVWVRISXUH]LQF>$*$$*$@7KLVSURFHVVSURGXFHVDPHWDOOLF
FRDWLQJFRPSRVHGRIYDULRXVOD\HUVRILURQ]LQFDOOR\V$QH[WHUQDOOD\HURISXUH]LQF FRDWLQJFRPSRVHGRIYDULRXVOD\HUVRILURQ]LQFDOOR\V$QH[WHUQDOOD\HURISXUH]LQF
OHIWE\WKHVLPSOHVROLGLILFDWLRQRIWKHOLTXLGPHWDOLVIRUPHGRQWRSRIDVHTXHQFHRI OHIWE\WKHVLPSOHVROLGLILFDWLRQRIWKHOLTXLGPHWDOLVIRUPHGRQWRSRIDVHTXHQFHRI
LQQHUOD\HUVZKLFKDUHLQFUHDVLQJO\ULFKLQLURQ7KHWKLFNQHVVRIWKHLURQ]LQFOD\HUV LQQHUOD\HUVZKLFKDUHLQFUHDVLQJO\ULFKLQLURQ7KHWKLFNQHVVRIWKHLURQ]LQFOD\HUV
GHSHQGVRQWKHFRPSRVLWLRQRIWKHVWHHOWKHWHPSHUDWXUHDQGFRPSRVLWLRQRIWKH]LQF GHSHQGVRQWKHFRPSRVLWLRQRIWKHVWHHOWKHWHPSHUDWXUHDQGFRPSRVLWLRQRIWKH]LQF
EDWKDQGWKHLPPHUVLRQWLPH0RUHRYHUWKHVLOLFRQFRQWHQWRIWKHFDUERQVWHHOKDVD EDWKDQGWKHLPPHUVLRQWLPH0RUHRYHUWKHVLOLFRQFRQWHQWRIWKHFDUERQVWHHOKDVD
VLJQLILFDQWHIIHFWRQWKHUHDFWLYLW\EHWZHHQVWHHODQG]LQFDQGWKXVRQWKHWKLFNQHVVRI VLJQLILFDQWHIIHFWRQWKHUHDFWLYLW\EHWZHHQVWHHODQG]LQFDQGWKXVRQWKHWKLFNQHVVRI
WKHVH EULWWOH OD\HUV $FFRUGLQJ WR >)UDWHVL E@ WKH UHDFWLYLW\ EHWZHHQ VWHHO DQG WKHVH EULWWOH OD\HUV $FFRUGLQJ WR >)UDWHVL E@ WKH UHDFWLYLW\ EHWZHHQ VWHHO DQG
]LQFLVKLJKIRUVLOLFRQFRQWHQWVEHWZHHQDQGRUDERYH$VSUR ]LQFLVKLJKIRUVLOLFRQFRQWHQWVEHWZHHQDQGRUDERYH$VSUR
GXFWLRQRIFDUERQVWHHOUHLQIRUFHPHQWLVJHQHUDOO\EDVHGRQUHF\FOLQJRIVFUDSLURQ FI GXFWLRQRIFDUERQVWHHOUHLQIRUFHPHQWLVJHQHUDOO\EDVHGRQUHF\FOLQJRIVFUDSLURQ FI
6HFWLRQ   LW LV SUDFWLFDOO\ LPSRVVLEOH WR ILQG UHEDUV ZLWK D VLOLFRQ FRQWHQW OHVV 6HFWLRQ   LW LV SUDFWLFDOO\ LPSRVVLEOH WR ILQG UHEDUV ZLWK D VLOLFRQ FRQWHQW OHVV
WKDQ  VR WKDW WKH EHVW FKRLFH ZLWK UHVSHFW WR WKH FKHPLFDODQDO\VLVDUHVLOLFRQ WKDQ  VR WKDW WKH EHVW FKRLFH ZLWK UHVSHFW WR WKH FKHPLFDODQDO\VLVDUHVLOLFRQ
FRQWHQWVEHWZHHQDQG)RULQVWDQFHWKHLQYHVWLJDWHGFDUERQUHEDUZLWKD FRQWHQWVEHWZHHQDQG)RULQVWDQFHWKHLQYHVWLJDWHGFDUERQUHEDUZLWKD
6LFRQWHQW!H[FHHGVWKLVUHTXLUHPHQWIRUKRWGLSJDOYDQLVDWLRQ 6LFRQWHQW!H[FHHGVWKLVUHTXLUHPHQWIRUKRWGLSJDOYDQLVDWLRQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

3DVVLYDWLRQRIWKHH[WHUQDOOD\HURISXUH]LQFLVJHQHUDOO\FRQVLGHUHGWREHWKHSULPDU\ 3DVVLYDWLRQRIWKHH[WHUQDOOD\HURISXUH]LQFLVJHQHUDOO\FRQVLGHUHGWREHWKHSULPDU\
PHFKDQLVP ZLWK UHJDUG WR WKH FRUURVLRQ UHVLVWDQFH RI JDOYDQLVHG UHLQIRUFHPHQW ,Q PHFKDQLVP ZLWK UHJDUG WR WKH FRUURVLRQ UHVLVWDQFH RI JDOYDQLVHG UHLQIRUFHPHQW ,Q
FRQWDFWZLWKDONDOLQHVROXWLRQV ZLWKDS+EHORZ ]LQFSDVVLYDWHVZLWKWKHIRUPD FRQWDFWZLWKDONDOLQHVROXWLRQV ZLWKDS+EHORZ ]LQFSDVVLYDWHVZLWKWKHIRUPD
WLRQRIDOD\HURIFDOFLXPK\GUR[\]LQFDWH$ORVVRI—PRIWKHSXUH]LQFOD\HULV WLRQRIDOD\HURIFDOFLXPK\GUR[\]LQFDWH$ORVVRI—PRIWKHSXUH]LQFOD\HULV
UHTXLUHGSULRUWRSDVVLYDWLRQ>%HUWROLQLHWDO@$FFRUGLQJWR><HRPDQV@ UHTXLUHGSULRUWRSDVVLYDWLRQ>%HUWROLQLHWDO@$FFRUGLQJWR><HRPDQV@
SDVVLYLW\EDVHGRQIRUPDWLRQRIFDOFLXPK\GUR[\]LQFDWHLVPDLQWDLQHGLQDS+UDQJH SDVVLYLW\EDVHGRQIRUPDWLRQRIFDOFLXPK\GUR[\]LQFDWHLVPDLQWDLQHGLQDS+UDQJH
EHWZHHQDQG$VPHQWLRQHGLQ6HFWLRQWKHSDVVLYHOD\HURQ]LQFGRHVQRW EHWZHHQDQG$VPHQWLRQHGLQ6HFWLRQWKHSDVVLYHOD\HURQ]LQFGRHVQRW
RQO\UHGXFHWKHUDWHRIWKHDQRGLFSURFHVVEXWDOVRODUJHO\LPSHGHVWKHFDWKRGLFUHDF RQO\UHGXFHWKHUDWHRIWKHDQRGLFSURFHVVEXWDOVRODUJHO\LPSHGHVWKHFDWKRGLFUHDF
WLRQVLHR[\JHQDQGK\GURJHQLRQUHGXFWLRQZKLFKZHFRQVLGHUWRDSSO\IRUSDVVLYD WLRQVLHR[\JHQDQGK\GURJHQLRQUHGXFWLRQZKLFKZHFRQVLGHUWRDSSO\IRUSDVVLYD
WLRQE\ FDOFLXPK\GUR[\]LQFDWHDV ZHOO 'XH WR WKH LPSHGHG FDWKRGLF UHDFWLRQV WKH WLRQE\ FDOFLXPK\GUR[\]LQFDWHDV ZHOO 'XH WR WKH LPSHGHG FDWKRGLF UHDFWLRQV WKH
µ(FRUU¶RIJDOYDQLVHGVWHHOLQFRQFUHWHLVPXFKORZHUWKDQWKHRIFDUERQVWHHO FI6HF µ(FRUU¶RIJDOYDQLVHGVWHHOLQFRQFUHWHLVPXFKORZHUWKDQWKHRIFDUERQVWHHO FI6HF
WLRQ 7\SLFDOYDOXHVIRUµ(FRUU¶RIJDOYDQLVHGVWHHOLQFRQFUHWHJLYHQLQWKHOLWHUD WLRQ 7\SLFDOYDOXHVIRUµ(FRUU¶RIJDOYDQLVHGVWHHOLQFRQFUHWHJLYHQLQWKHOLWHUD
WXUH DUH PRVWO\ LQ WKH RUGHU RI í WR í P96+( ZKHUHDV RZQ LQYHVWLJDWLRQV WXUH DUH PRVWO\ LQ WKH RUGHU RI í WR í P96+( ZKHUHDV RZQ LQYHVWLJDWLRQV
VKRZHGHYHQORZHUSRWHQWLDOVLQWKHRUGHURIíP96+(IRU]LQFLQR[\JHQGHSULYHG VKRZHGHYHQORZHUSRWHQWLDOVLQWKHRUGHURIíP96+(IRU]LQFLQR[\JHQGHSULYHG
FRQFUHWH>.WHUHWDOE@ FRQFUHWH>.WHUHWDOE@
$WDQHDUO\DJHWKHERQGVWUHQJWKRIJDOYDQLVHGUHEDUVLVNQRZQWREHORZHUWKDQWKH $WDQHDUO\DJHWKHERQGVWUHQJWKRIJDOYDQLVHGUHEDUVLVNQRZQWREHORZHUWKDQWKH
RQHRIFDUERQVWHHOUHEDUVZKLFKLVJHQHUDOO\DWWULEXWHGWRK\GURJHQHYROXWLRQDVZHOO RQHRIFDUERQVWHHOUHEDUVZKLFKLVJHQHUDOO\DWWULEXWHGWRK\GURJHQHYROXWLRQDVZHOO
DVWRWKHGLVVROXWLRQRI]LQFIURPWKHVXSHUILFLDOOD\HUWKDWGHOD\VWKHK\GUDWLRQRIWKH DVWRWKHGLVVROXWLRQRI]LQFIURPWKHVXSHUILFLDOOD\HUWKDWGHOD\VWKHK\GUDWLRQRIWKH
FHPHQW SDVWH DW WKH FRQFUHWHVWHHO LQWHUIDFH FI WKH LQIOXHQFH RI FRSSHU LQ 6HFWLRQ FHPHQW SDVWH DW WKH FRQFUHWHVWHHO LQWHUIDFH FI WKH LQIOXHQFH RI FRSSHU LQ 6HFWLRQ
  +RZHYHU DIWHU D IHZ ZHHNV WKH JDOYDQLVHG VWHHO DGKHUHV ZHOO DQG LWV LQ   +RZHYHU DIWHU D IHZ ZHHNV WKH JDOYDQLVHG VWHHO DGKHUHV ZHOO DQG LWV LQ
FUHDVHG URXJKQHVV HYHQ LPSURYHV DGKHVLRQ WR WKH FRQFUHWH ,PSURYHG ERQG LV IXU FUHDVHG URXJKQHVV HYHQ LPSURYHV DGKHVLRQ WR WKH FRQFUHWH ,PSURYHG ERQG LV IXU
WKHUPRUHREWDLQHGGXHWRWKHIRUPDWLRQRIFDOFLXPK\GUR[\]LQFDWHFU\VWDOVWKDWILOOWKH WKHUPRUHREWDLQHGGXHWRWKHIRUPDWLRQRIFDOFLXPK\GUR[\]LQFDWHFU\VWDOVWKDWILOOWKH
LQWHUIDFLDO SRURVLW\ RI WKH FHPHQW SDVWH DQG DFW DV EULGJHV EHWZHHQ WKH ]LQF FRDWLQJ LQWHUIDFLDO SRURVLW\ RI WKH FHPHQW SDVWH DQG DFW DV EULGJHV EHWZHHQ WKH ]LQF FRDWLQJ
DQGWKHFRQFUHWH>)UDWHVLD@ ,QSUDFWLFH KRZHYHU WKHERQGVWUHQJWKIRUULEEHG DQG WKH FRQFUHWH >)UDWHVL D@ ,QSUDFWLFH KRZHYHU WKHERQGVWUHQJWKIRUULEEHG
JDOYDQLVHG UHEDU DQG ULEEHG FDUERQ VWHHO HJ WHVWHG DFFRUGLQJ WR >$670 $ JDOYDQLVHG UHEDU DQG ULEEHG FDUERQ VWHHO HJ WHVWHG DFFRUGLQJ WR >$670 $
@DUHHVVHQWLDOO\LGHQWLFDOEHFDXVHLWLVPDLQO\SURYLGHGE\WKHPHFKDQLFDOLQWHU @DUHHVVHQWLDOO\LGHQWLFDOEHFDXVHLWLVPDLQO\SURYLGHGE\WKHPHFKDQLFDOLQWHU
ORFNLQJEHWZHHQWKHULEVDQGWKHFRQFUHWH FI6HFWLRQ  ORFNLQJEHWZHHQWKHULEVDQGWKHFRQFUHWH FI6HFWLRQ 
*DOYDQLVHG EDUV DUH RIWHQ FKURPDWH WUHDWHG LQ RUGHU WR LQKLELW ]LQF FRUURVLRQ DQG WR *DOYDQLVHG EDUV DUH RIWHQ FKURPDWH WUHDWHG LQ RUGHU WR LQKLELW ]LQF FRUURVLRQ DQG WR
FRQWURO K\GURJHQ HYROXWLRQ FI WKH WKHUPRG\QDPLF HIIHFW RI FKURPDWHV LQ 6HFWLRQ FRQWURO K\GURJHQ HYROXWLRQ FI WKH WKHUPRG\QDPLF HIIHFW RI FKURPDWHV LQ 6HFWLRQ
  +\GURJHQ HYROXWLRQ LV FRQVLGHUHG SRVVLEOH RQ JDOYDQLVHG EDUV ILUVW RI DOO   +\GURJHQ HYROXWLRQ LV FRQVLGHUHG SRVVLEOH RQ JDOYDQLVHG EDUV ILUVW RI DOO
GXULQJSLFNOLQJEHIRUHJDOYDQLVDWLRQWKHQLQWKHILUVWKRXUVDIWHUFDVWLQJDQGILQDOO\LQ GXULQJSLFNOLQJEHIRUHJDOYDQLVDWLRQWKHQLQWKHILUVWKRXUVDIWHUFDVWLQJDQGILQDOO\LQ
KDUGHQHGFRQFUHWHLQFRQGLWLRQVRIODFNRIR[\JHQ)RUWKLVUHDVRQJDOYDQLVLQJLVQRW KDUGHQHGFRQFUHWHLQFRQGLWLRQVRIODFNRIR[\JHQ)RUWKLVUHDVRQJDOYDQLVLQJLVQRW
UHFRPPHQGHGDVDSURWHFWLYHPHDVXUHIRUVWHHOVXVFHSWLEOHWRK\GURJHQHPEULWWOHPHQW UHFRPPHQGHGDVDSURWHFWLYHPHDVXUHIRUVWHHOVXVFHSWLEOHWRK\GURJHQHPEULWWOHPHQW
LHKLJKVWUHQJWKVWHHOVDVRIWHQXVHGIRUHJSUHVWUHVVLQJRUSRVWWHQVLRQLQJ*DOYD LHKLJKVWUHQJWKVWHHOVDVRIWHQXVHGIRUHJSUHVWUHVVLQJRUSRVWWHQVLRQLQJ*DOYD
QLVHGVWHHOLVZHOGDEOHEXWORVVRIWKH]LQFFRDWLQJJHQHUDOO\WDNHVSODFHLQWKHZHOGHG QLVHGVWHHOLVZHOGDEOHEXWORVVRIWKH]LQFFRDWLQJJHQHUDOO\WDNHVSODFHLQWKHZHOGHG
]RQH,QVXFKFDVHVDVZHOODVIRUODUJHUGHIHFWVWKHDSSOLFDWLRQRID]LQFULFKSDLQWLV ]RQH,QVXFKFDVHVDVZHOODVIRUODUJHUGHIHFWVWKHDSSOLFDWLRQRID]LQFULFKSDLQWLV
UHFRPPHQGHG UHFRPPHQGHG
:LWKUHJDUGWRFRUURVLRQUHVLVWDQFHWKHSHUIRUPDQFHRI]LQFVWHHOLQFRQFUHWHLVTXLWH :LWKUHJDUGWRFRUURVLRQUHVLVWDQFHWKHSHUIRUPDQFHRI]LQFVWHHOLQFRQFUHWHLVTXLWH
GLIIHUHQWIURPWKHSHUIRUPDQFHRIKRWGLSJDOYDQLVHGVWHHOLQDWPRVSKHULFFRQGLWLRQV GLIIHUHQWIURPWKHSHUIRUPDQFHRIKRWGLSJDOYDQLVHGVWHHOLQDWPRVSKHULFFRQGLWLRQV
7KHUHLVDJHQHUDODJUHHPHQWLQWKHOLWHUDWXUHWKDWWKHSDVVLYHILOPRIJDOYDQLVHGUHEDUV 7KHUHLVDJHQHUDODJUHHPHQWLQWKHOLWHUDWXUHWKDWWKHSDVVLYHILOPRIJDOYDQLVHGUHEDUV
LVVWDEOHLQPLOGO\DFLGLFHQYLURQPHQWVVRWKDWWKH]LQFFRDWLQJUHPDLQVSDVVLYHHYHQ LVVWDEOHLQPLOGO\DFLGLFHQYLURQPHQWVVRWKDWWKH]LQFFRDWLQJUHPDLQVSDVVLYHHYHQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV

ZKHQWKHFRQFUHWHLVFDUERQDWHG7KHFRUURVLRQUDWHRIJDOYDQLVHGVWHHOLQFDUERQDWHG ZKHQWKHFRQFUHWHLVFDUERQDWHG7KHFRUURVLRQUDWHRIJDOYDQLVHGVWHHOLQFDUERQDWHG
FRQFUHWHKDVEHHQHVWLPDWHGWR—P\>'DYLV%HUWROLQLHWDO@7KH FRQFUHWHKDVEHHQHVWLPDWHGWR—P\>'DYLV%HUWROLQLHWDO@7KH
FRUURVLRQ UDWH LQ FDUERQDWHG FRQFUHWH UHPDLQV QHJOLJLEOH HYHQ LI D ORZHU FRQWHQW RI FRUURVLRQ UDWH LQ FDUERQDWHG FRQFUHWH UHPDLQV QHJOLJLEOH HYHQ LI D ORZHU FRQWHQW RI
FKORULGH LV SUHVHQW ,Q FKORULGH FRQWDPLQDWHG FRQFUHWH KRZHYHU JDOYDQLVHG VWHHO LV FKORULGH LV SUHVHQW ,Q FKORULGH FRQWDPLQDWHG FRQFUHWH KRZHYHU JDOYDQLVHG VWHHO LV
JHQHUDOO\FRQVLGHUHGWREHDIIHFWHGE\SLWWLQJFRUURVLRQ,QPRVWRIWKHPHQWLRQHGOLW JHQHUDOO\FRQVLGHUHGWREHDIIHFWHGE\SLWWLQJFRUURVLRQ,QPRVWRIWKHPHQWLRQHGOLW
HUDWXUHDFKORULGHWKUHVKROGOHYHOLQWKHUDQJHRIµZZFH¶LVDVVXPHGIRUJDO HUDWXUHDFKORULGHWKUHVKROGOHYHOLQWKHUDQJHRIµZZFH¶LVDVVXPHGIRUJDO
YDQLVHGVWHHOFRPSDUHGWRµZZFH¶ZKLFKLVQRUPDOO\FRQVLGHUHGIRUFDUERQ YDQLVHGVWHHOFRPSDUHGWRµZZFH¶ZKLFKLVQRUPDOO\FRQVLGHUHGIRUFDUERQ
VWHHOUHLQIRUFHPHQW FI6HFWLRQ 2WKHUOLWHUDWXUHVXJJHVWVWKDWJDOYDQLVHGUHLQ VWHHOUHLQIRUFHPHQW FI6HFWLRQ 2WKHUOLWHUDWXUHVXJJHVWVWKDWJDOYDQLVHGUHLQ
IRUFHPHQW UHVLVWV DW OHDVW  WLPHV KLJKHU FKORULGH FRQWHQWV LQ FRQFUHWH WKDQ FDUERQ IRUFHPHQW UHVLVWV DW OHDVW  WLPHV KLJKHU FKORULGH FRQWHQWV LQ FRQFUHWH WKDQ FDUERQ
VWHHO DQG WKDW JDOYDQLVDWLRQ GHOD\V WKH WLPH RI FRUURVLRQ LQLWLDWLRQ RI WKH XQGHUO\LQJ VWHHO DQG WKDW JDOYDQLVDWLRQ GHOD\V WKH WLPH RI FRUURVLRQ LQLWLDWLRQ RI WKH XQGHUO\LQJ
VWHHOE\WLPHVHJ><HRPDQV@ VWHHOE\WLPHVHJ><HRPDQV@
7KHLPSURYHGUHVLVWDQFHWRFKORULGHDWWDFNLVFRQVLGHUHGWREHPDLQO\GXHWRWKHORZHU 7KHLPSURYHGUHVLVWDQFHWRFKORULGHDWWDFNLVFRQVLGHUHGWREHPDLQO\GXHWRWKHORZHU
µ(FRUU¶(YHQLISLWWLQJFRUURVLRQKDVLQLWLDWHGWKHFRUURVLRQUDWHWHQGVWREHORZHUIRU µ(FRUU¶(YHQLISLWWLQJFRUURVLRQKDVLQLWLDWHGWKHFRUURVLRQUDWHWHQGVWREHORZHUIRU
JDOYDQLVHGVWHHOEHFDXVH]LQFDFWVDVDSRRUFDWKRGH*DOYDQLVDWLRQUHGXFHVWKHHIIHF JDOYDQLVHGVWHHOEHFDXVH]LQFDFWVDVDSRRUFDWKRGH*DOYDQLVDWLRQUHGXFHVWKHHIIHF
WLYHQHVV RI WKH DXWRFDWDO\WLF PHFKDQLVP WKDW WDNHV SODFH LQVLGH D FRUURVLRQ SLW FI WLYHQHVV RI WKH DXWRFDWDO\WLF PHFKDQLVP WKDW WDNHV SODFH LQVLGH D FRUURVLRQ SLW FI
6HFWLRQ   LQ FRPELQDWLRQ ZLWK PDFURFHOO IRUPDWLRQ FI 6HFWLRQ   <HW LW 6HFWLRQ   LQ FRPELQDWLRQ ZLWK PDFURFHOO IRUPDWLRQ FI 6HFWLRQ   <HW LW
VKRXOGEHHPSKDVLVHGWKDWDSDVVLYH]LQFFRDWLQJGRHVQRWSURYLGHDFWLYHSURWHFWLRQWR VKRXOGEHHPSKDVLVHGWKDWDSDVVLYH]LQFFRDWLQJGRHVQRWSURYLGHDFWLYHSURWHFWLRQWR
VWHHO DV XQGHU DWPRVSKHULF FRQGLWLRQV 7KHUHIRUH FUDFNV LQ WKH]LQFFRDWLQJPXVWEH VWHHO DV XQGHU DWPRVSKHULF FRQGLWLRQV 7KHUHIRUH FUDFNV LQ WKH]LQFFRDWLQJPXVWEH
DYRLGHGDQGUHSDLURIPDFURVFRSLFGHIHFWVEHIRUHFDVWLQJLVFUXFLDO DYRLGHGDQGUHSDLURIPDFURVFRSLFGHIHFWVEHIRUHFDVWLQJLVFUXFLDO
&RQVLGHUDEOHZRUNKDVEHHQGRQHWRLGHQWLI\WKHQDWXUHRI]LQFFRUURVLRQSURGXFWVDQG &RQVLGHUDEOHZRUNKDVEHHQGRQHWRLGHQWLI\WKHQDWXUHRI]LQFFRUURVLRQSURGXFWVDQG
WKHHIIHFWRIWKHVHRQWKHLQWHJULW\RIWKHFRQFUHWH:KLOHWKHPDMRUSDUWRIWKHOLWHUD WKHHIIHFWRIWKHVHRQWKHLQWHJULW\RIWKHFRQFUHWH:KLOHWKHPDMRUSDUWRIWKHOLWHUD
WXUHUHSRUWVWKDW]LQFFRUURVLRQSURGXFWVGRQRWLQWHUIHUHZLWKWKHLQWHJULW\RIFRQFUHWH WXUHUHSRUWVWKDW]LQFFRUURVLRQSURGXFWVGRQRWLQWHUIHUHZLWKWKHLQWHJULW\RIFRQFUHWH
VRPHVWXGLHVSUHVHQWFRQWUDGLFWRU\UHVXOWV)RULQVWDQFHLQ>3RSRY@LWKDVEHHQ VRPHVWXGLHVSUHVHQWFRQWUDGLFWRU\UHVXOWV)RULQVWDQFHLQ>3RSRY@LWKDVEHHQ
SRVWXODWHGWKDW]LQFK\GUR[\FKORULGHZKLFKRFFXSLHVPRUHWKDQWLPHVWKHYROXPH SRVWXODWHGWKDW]LQFK\GUR[\FKORULGHZKLFKRFFXSLHVPRUHWKDQWLPHVWKHYROXPH
RI]LQFLVWKHSULQFLSDOFRUURVLRQSURGXFWRIJDOYDQLVHGVWHHOLQFKORULGHFRQWDPLQDWHG RI]LQFLVWKHSULQFLSDOFRUURVLRQSURGXFWRIJDOYDQLVHGVWHHOLQFKORULGHFRQWDPLQDWHG
FRQFUHWH&RQVHTXHQWO\LWKDVEHHQFRQFOXGHGWKDWJDOYDQLVHGFRDWLQJVLQKLJKFKOR FRQFUHWH&RQVHTXHQWO\LWKDVEHHQFRQFOXGHGWKDWJDOYDQLVHGFRDWLQJVLQKLJKFKOR
ULGHHQYLURQPHQWVFRXOGEHGHWULPHQWDOWRWKHKHDOWKRIWKHVWUXFWXUH+RZHYHULQDOO ULGHHQYLURQPHQWVFRXOGEHGHWULPHQWDOWRWKHKHDOWKRIWKHVWUXFWXUH+RZHYHULQDOO
DERYHPHQWLRQHGVRXUFHVDVZHOODVLQHJ>=KDQJ7RPOLQVRQ 0DUVK DERYHPHQWLRQHGVRXUFHVDVZHOODVLQHJ>=KDQJ7RPOLQVRQ 0DUVK
)UDWHVLD@]LQFFRUURVLRQSURGXFWVDUHGHVFULEHGDVORRVHUDWKHUWKDQEXON\DQG )UDWHVLD@]LQFFRUURVLRQSURGXFWVDUHGHVFULEHGDVORRVHUDWKHUWKDQEXON\DQG
DV PLJUDWLQJ DZD\ IURP WKH FRQFUHWHVWHHO LQWHUIDFH LQWR WKH DGMDFHQW FRQFUHWH EXON DV PLJUDWLQJ DZD\ IURP WKH FRQFUHWHVWHHO LQWHUIDFH LQWR WKH DGMDFHQW FRQFUHWH EXON
ZKHUHWKH\ ILOOYRLGVDQGPLFURFUDFNV ,QFRQWUDVWWRLURQFRUURVLRQSURGXFWVIRUPHG ZKHUHWKH\ ILOOYRLGVDQGPLFURFUDFNV ,QFRQWUDVWWRLURQFRUURVLRQSURGXFWVIRUPHG
ZLWKDYDLODELOLW\RIR[\JHQZKLFKDUHUHODWLYHO\YROXPLQRXV FI7DEOHLQ  ZLWKDYDLODELOLW\RIR[\JHQZKLFKDUHUHODWLYHO\YROXPLQRXV FI7DEOHLQ 
DQGSUHFLSLWDWH DW WKH VWHHOFRQFUHWH LQWHUIDFH FDXVLQJ WHQVLOHVWUHVVHVWKHVHSURGXFWV DQGSUHFLSLWDWH DW WKH VWHHOFRQFUHWH LQWHUIDFH FDXVLQJ WHQVLOHVWUHVVHVWKHVHSURGXFWV
DUH JHQHUDOO\ FRQVLGHUHG WR FDXVH YHU\ OLWWOH GLVUXSWLRQ WR WKH VXUURXQGLQJ FRQFUHWH DUH JHQHUDOO\ FRQVLGHUHG WR FDXVH YHU\ OLWWOH GLVUXSWLRQ WR WKH VXUURXQGLQJ FRQFUHWH
EXON EXON
%DVHGRQWKHDERYHLWFDQEHFRQFOXGHGWKDWJDOYDQLVDWLRQSURYLGHVJRRGUHVLVWDQFHWR %DVHGRQWKHDERYHLWFDQEHFRQFOXGHGWKDWJDOYDQLVDWLRQSURYLGHVJRRGUHVLVWDQFHWR
FDUERQDWLRQLQGXFHGFRUURVLRQZKLOHUHVLVWDQFHWRFKORULGHLQGXFHGFRUURVLRQLVLP FDUERQDWLRQLQGXFHGFRUURVLRQZKLOHUHVLVWDQFHWRFKORULGHLQGXFHGFRUURVLRQLVLP
SURYHG ZLWK UHJDUG WR ERWK WKH LQLWLDWLRQ DQG WKH SURSDJDWLRQ VWDJH EXW VWLOO LQVXIIL SURYHG ZLWK UHJDUG WR ERWK WKH LQLWLDWLRQ DQG WKH SURSDJDWLRQ VWDJH EXW VWLOO LQVXIIL
FLHQWZLWKUHJDUGWRORQJWHUPGXUDELOLW\ +RZHYHU WKLV DQG RWKHUFULWLFDODVSHFWVRI FLHQWZLWKUHJDUGWRORQJWHUPGXUDELOLW\+RZHYHUWKLVDQGRWKHUFULWLFDO DVSHFWVRI
]LQFHJZLWKUHJDUGWRVDFULILFLDOSURWHFWLRQLQ FRQFUHWHVHHPV QRW WREH DFNQRZO ]LQFHJZLWKUHJDUGWRVDFULILFLDOSURWHFWLRQLQ FRQFUHWHVHHPV QRW WREH DFNQRZO

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

HGJHGE\WKHDVVRFLDWHGLQGXVWU\HJ,=$ >,=$@DVZHOO$*$‚>$*$ HGJHGE\WKHDVVRFLDWHGLQGXVWU\HJ,=$ >,=$@DVZHOO$*$‚>$*$


$*$@SRVWXODWHZLWKUHJDUGWRWKHSHUIRUPDQFHRIJDOYDQLVHGVWHHOLQFRQFUHWH $*$@SRVWXODWHZLWKUHJDUGWRWKHSHUIRUPDQFHRIJDOYDQLVHGVWHHOLQFRQFUHWH
‡ ³ =LQF¶V VDFULILFLDO DFWLRQ RIIHUV SURWHFWLRQ ZKHUH VPDOO DUHDV RI VWHHO DUH H[ ‡ ³ =LQF¶V VDFULILFLDO DFWLRQ RIIHUV SURWHFWLRQ ZKHUH VPDOO DUHDV RI VWHHO DUH H[
SRVHGVXFKDVFXWHGJHVGULOOKROHVVFUDWFKHVRUDVWKHUHVXOWRIVHYHUHVXUIDFH SRVHGVXFKDVFXWHGJHVGULOOKROHVVFUDWFKHVRUDVWKHUHVXOWRIVHYHUHVXUIDFH
DEUDVLRQ &DWKRGLF SURWHFWLRQ RI WKH VWHHO IURP FRUURVLRQ FRQWLQXHV XQWLO DOO WKH DEUDVLRQ &DWKRGLF SURWHFWLRQ RI WKH VWHHO IURP FRUURVLRQ FRQWLQXHV XQWLO DOO WKH
]LQFLQWKHLPPHGLDWHDUHDLVFRQVXPHG´ ]LQFLQWKHLPPHGLDWHDUHDLVFRQVXPHG´
‡ ³*DOYDQLVHGUHLQIRUFLQJVWHHOFDQZLWKVWDQGH[SRVXUHWRFKORULGHLRQ FRQFHQ ‡ ³*DOYDQLVHGUHLQIRUFLQJVWHHOFDQZLWKVWDQGH[SRVXUHWRFKORULGHLRQ FRQFHQ
WUDWLRQV VHYHUDO WLPHV KLJKHU DW OHDVW  WR  WLPHV  WKDQ WKH FKORULGH OHYHO WKDW WUDWLRQV VHYHUDO WLPHV KLJKHU DW OHDVW  WR  WLPHV  WKDQ WKH FKORULGH OHYHO WKDW
FDXVHVFRUURVLRQLQFDUERQVWHHOUHLQIRUFHPHQW´ FDXVHVFRUURVLRQLQFDUERQVWHHOUHLQIRUFHPHQW´
‡ ³'XULQJFXULQJWKHJDOYDQLVHGVXUIDFHRIVWHHOUHLQIRUFHPHQWUHDFWVZLWKWKHDO ‡ ³'XULQJFXULQJWKHJDOYDQLVHGVXUIDFHRIVWHHOUHLQIRUFHPHQWUHDFWVZLWKWKHDO
NDOLQHFHPHQWSDVWHWRIRUPVWDEOHLQVROXEOH]LQFVDOWVDFFRPSDQLHGE\K\GURJHQ NDOLQHFHPHQWSDVWHWRIRUPVWDEOHLQVROXEOH]LQFVDOWVDFFRPSDQLHGE\K\GURJHQ
HYROXWLRQ  /DERUDWRU\ VWXGLHV LQGLFDWH WKDW WKLV OLEHUDWHG K\GURJHQ GRHV QRW HYROXWLRQ  /DERUDWRU\ VWXGLHV LQGLFDWH WKDW WKLV OLEHUDWHG K\GURJHQ GRHV QRW
SHUPHDWHWKHJDOYDQLVHGFRDWLQJWRWKHXQGHUO\LQJVWHHODQGWKHUHDFWLRQFHDVHVDV SHUPHDWHWKHJDOYDQLVHGFRDWLQJWRWKHXQGHUO\LQJVWHHODQGWKHUHDFWLRQFHDVHVDV
VRRQDVWKHFRQFUHWHKDUGHQV´ VRRQDVWKHFRQFUHWHKDUGHQV´
‡ ³ ,I WKH FHPHQW DQG DJJUHJDWH FRQWDLQ OHVV FKURPDWH WKDQ ZLOO \LHOG DW OHDVW ‡ ³ ,I WKH FHPHQW DQG DJJUHJDWH FRQWDLQ OHVV FKURPDWH WKDQ ZLOO \LHOG DW OHDVW
SSPLQWKHILQDOFRQFUHWHPL[WKHJDOYDQLVHGEDUVFDQEHGLSSHGLQDFKUR SSPLQWKHILQDOFRQFUHWHPL[WKHJDOYDQLVHGEDUVFDQEHGLSSHGLQDFKUR
PDWH VROXWLRQ RU FKURPDWHV FDQ EH DGGHG WR WKH ZDWHU ZKHQ WKH FRQFUHWH LV PDWH VROXWLRQ RU FKURPDWHV FDQ EH DGGHG WR WKH ZDWHU ZKHQ WKH FRQFUHWH LV
PL[HG´ PL[HG´
$ FRPSDULVRQ RI WKHVH VWDWHPHQWV ZLWK WKH LQIRUPDWLRQ SURYLGHG LQ WKH DERYH LOOXV $ FRPSDULVRQ RI WKHVH VWDWHPHQWV ZLWK WKH LQIRUPDWLRQ SURYLGHG LQ WKH DERYH LOOXV
WUDWHVWKHFRPPRQGLVFUHSDQFLHVEHWZHHQWKHSRLQWRIYLHZVRILQGXVWULHVZLWKDPDU WUDWHVWKHFRPPRQGLVFUHSDQFLHVEHWZHHQWKHSRLQWRIYLHZVRILQGXVWULHVZLWKDPDU
NHWLQJLQWHUHVWDQGWKHUHVHDUFKFRPPXQLW\ NHWLQJLQWHUHVWDQGWKHUHVHDUFKFRPPXQLW\

 &DWKRGLF3UHYHQWLRQ  &DWKRGLF3UHYHQWLRQ


7KHQDPHFDWKRGLFSUHYHQWLRQµ&3UH¶ZDVFRLQHGLQ>3HGHIHUUL@WRGLIIHUHQWLDWH 7KHQDPHFDWKRGLFSUHYHQWLRQµ&3UH¶ZDVFRLQHGLQ>3HGHIHUUL@WRGLIIHUHQWLDWH
WKLVWHFKQLTXHIURPFDWKRGLFSURWHFWLRQµ&3¶ZKLFKLVJHQHUDOO\FRQVLGHUHGDVDFRXQ WKLVWHFKQLTXHIURPFDWKRGLFSURWHFWLRQµ&3¶ZKLFKLVJHQHUDOO\FRQVLGHUHGDVDFRXQ
WHUPHDVXUHIRUH[LVWLQJVWUXFWXUHV FI6HFWLRQ µ&3UH¶ZKLFKZDVILUVWXVHGLQ WHUPHDVXUHIRUH[LVWLQJVWUXFWXUHV FI6HFWLRQ µ&3UH¶ZKLFKZDVILUVWXVHGLQ
,WDO\ LQ  LV DSSOLHG WR QHZ VWUXFWXUHV WKDW DUH H[SHFWHG WR EH FRQWDPLQDWHG E\ ,WDO\ LQ  LV DSSOLHG WR QHZ VWUXFWXUHV WKDW DUH H[SHFWHG WR EH FRQWDPLQDWHG E\
FKORULGHV7KHUHLQIRUFHPHQWLVFDWKRGLFDOO\SRODULVHGZLWKWKHDLPRILQFUHDVLQJWKH FKORULGHV7KHUHLQIRUFHPHQWLVFDWKRGLFDOO\SRODULVHGZLWKWKHDLPRILQFUHDVLQJWKH
FKORULGHWKUHVKROGVRWKDWWKHGHVLUHGVHUYLFHOLIHFDQEHDWWDLQHG:LWKUHJDUGWRWKH FKORULGHWKUHVKROGVRWKDWWKHGHVLUHGVHUYLFHOLIHFDQEHDWWDLQHG:LWKUHJDUGWRWKH
SLWWLQJ SRWHQWLDO FXUYHV VKRZQ LQ )LJXUH  LQ 6HFWLRQ  WKLV FDQ EH XQGHU SLWWLQJ SRWHQWLDO FXUYHV VKRZQ LQ )LJXUH  LQ 6HFWLRQ  WKLV FDQ EH XQGHU
VWRRG DV PDLQWDLQLQJ WKH FRUURVLRQ SRWHQWLDO VR WKDW µ(SLW¶ DVVRFLDWHG ZLWK D JLYHQ VWRRG DV PDLQWDLQLQJ WKH FRUURVLRQ SRWHQWLDO VR WKDW µ(SLW¶ DVVRFLDWHG ZLWK D JLYHQ
PD[LPXP FKORULGH FRQWHQW LV QRW UHDFKHG *HQHUDOO\ FXUUHQW GHQVLWLHV IURP  PD[LPXP FKORULGH FRQWHQW LV QRW UHDFKHG *HQHUDOO\ FXUUHQW GHQVLWLHV IURP 
P$PDUHDSSOLHGIRUFDWKRGLFSUHYHQWLRQ>%HUWROLQLHWDO@ P$PDUHDSSOLHGIRUFDWKRGLFSUHYHQWLRQ>%HUWROLQLHWDO@
$VKRUWQRWHRQRWKHUEHQHILFLDODQGVLGHHIIHFWVRIµ&3UH¶LQSDUWLFXODUZLWKUHJDUGWR $VKRUWQRWHRQRWKHUEHQHILFLDODQGVLGHHIIHFWVRIµ&3UH¶LQSDUWLFXODUZLWKUHJDUGWR
PLJUDWLRQRILRQVLQWKHSRUHVROXWLRQ FI6HFWLRQVDQG IURPDQGWRWKH PLJUDWLRQRILRQVLQWKHSRUHVROXWLRQ FI6HFWLRQVDQG IURPDQGWRWKH

 

,QWHUQDWLRQDO=LQF$VVRFLDWLRQ ,=$ %UXVVHOV%HOJLXP ,QWHUQDWLRQDO=LQF$VVRFLDWLRQ ,=$ %UXVVHOV%HOJLXP
‚ ‚
$PHULFDQ*DOYDQL]HUV$VVRFLDWLRQ $*$ &HQWHQQLDO&286$ $PHULFDQ*DOYDQL]HUV$VVRFLDWLRQ $*$ &HQWHQQLDO&286$

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV

FRQFUHWHVWHHOLQWHUIDFHLVJLYHQLQ6HFWLRQZKHUHHOHFWURFKHPLFDOPHWKRGVDS FRQFUHWHVWHHOLQWHUIDFHLVJLYHQLQ6HFWLRQZKHUHHOHFWURFKHPLFDOPHWKRGVDS
SOLHGDVFRXQWHUPHDVXUHVIRUH[LVWLQJVWUXFWXUHVDUHVXPPDULVHG SOLHGDVFRXQWHUPHDVXUHVIRUH[LVWLQJVWUXFWXUHVDUHVXPPDULVHG

 &RVWVRI&RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV  &RVWVRI&RXQWHUPHDVXUHVIRU1HZ6WUXFWXUHV


)RUDQHYDOXDWLRQRIWKHHIIHFWLYHQHVVRIDFRXQWHUPHDVXUHFRQVLGHUDWLRQVRQLWVHFRQ )RUDQHYDOXDWLRQRIWKHHIIHFWLYHQHVVRIDFRXQWHUPHDVXUHFRQVLGHUDWLRQVRQLWVHFRQ
RP\ DUH RI PDMRU LPSRUWDQFH LQ SDUWLFXODU ZKHQ WDNLQJ LQWR DFFRXQW WKH HQRUPRXV RP\ DUH RI PDMRU LPSRUWDQFH LQ SDUWLFXODU ZKHQ WDNLQJ LQWR DFFRXQW WKH HQRUPRXV
TXDQWLWLHV XVHG LQ WKH FRQFUHWH EXVLQHVV FI 6HFWLRQ   7\SLFDO SULFH UDQJHV RI TXDQWLWLHV XVHG LQ WKH FRQFUHWH EXVLQHVV FI 6HFWLRQ   7\SLFDO SULFH UDQJHV RI
FRXQWHUPHDVXUHVIRUQHZVWUXFWXUHVVWDWHGLQGLIIHUHQWVRXUFHVDUHOLVWHGLQ7DEOH FRXQWHUPHDVXUHVIRUQHZVWUXFWXUHVVWDWHGLQGLIIHUHQWVRXUFHVDUHOLVWHGLQ7DEOH
7DEOH 3ULFH UDQJHV RI VHOHFWHG FRXQWHUPHDVXUHV IRU QHZ VWUXFWXUHV IURP GLI 7DEOH 3ULFH UDQJHV RI VHOHFWHG FRXQWHUPHDVXUHV IRU QHZ VWUXFWXUHV IURP GLI
IHUHQW VRXUFHV >$@ >%HUWROLQL HWDO @ >%@ >,=$ @ >&@ IHUHQW VRXUFHV >$@ >%HUWROLQL HWDO @ >%@ >,=$ @ >&@
>1UQEHUJHU@ >1UQEHUJHU@

6RXUFH 6RXUFH
&RXQWHUPHDVXUH 'HWDLOV &RXQWHUPHDVXUH 'HWDLOV
>$@ >%@ >&@ >$@ >%@ >&@
&RQFUHWHFRXQWHUPHDVXUHV FRDWLQJVLQ>¼P@DQGLQKLELWRUVLQ>¼P@  &RQFUHWHFRXQWHUPHDVXUHV FRDWLQJVLQ>¼P@DQGLQKLELWRUVLQ>¼P@ 
&RQFUHWHVXUIDFH &RQWLQXRXVILOP    &RQFUHWHVXUIDFH &RQWLQXRXVILOP   
SURWHFWLRQ +\GURSKRELFOD\HU    SURWHFWLRQ +\GURSKRELFOD\HU   
,QWHJUDOLQKLELWRU &DOFLXPQLWULWH    ,QWHJUDOLQKLELWRU &DOFLXPQLWULWH   
5HLQIRUFHPHQWFRXQWHUPHDVXUHV EDVHGRQ³´DVWKHFRVWRIRUGLQDU\FDUERQVWHHOUHLQIRUFH 5HLQIRUFHPHQWFRXQWHUPHDVXUHV EDVHGRQ³´DVWKHFRVWRIRUGLQDU\FDUERQVWHHOUHLQIRUFH
PHQWEXWFDWKRGLFSUHYHQWLRQLQ>¼P@  PHQWEXWFDWKRGLFSUHYHQWLRQLQ>¼P@ 
(SR[\,    (SR[\,   

(SR[\ (SR[\,,     (SR[\ (SR[\,,    
3XUSOHHSR[\    3XUSOHHSR[\   
 (1$670      (1$670    
6WDLQOHVVVWHHO  (1$670     6WDLQOHVVVWHHO  (1$670    
 (1$670      (1$670    
0LFURFRPSRVLWHVWHHO    0LFURFRPSRVLWHVWHHO   

6WDLQOHVVVWHHOFODGGHGFDUERQVWHHO     6WDLQOHVVVWHHOFODGGHGFDUERQVWHHO    
+RWGLSJDOYDQLVHGVWHHO     +RWGLSJDOYDQLVHGVWHHO    
&DWKRGLFSUHYHQWLRQ    &DWKRGLFSUHYHQWLRQ   
 


 ,QFOXGHVFRVWVIRUFRDWLQJFODGGLQJDQGFDUERQVWHHO  ,QFOXGHVFRVWVIRUFRDWLQJFODGGLQJDQGFDUERQVWHHO

 
:LWKUHJDUGWRWKHDERYHOLVWHGSULFHUDQJHVLWLVLPSRUWDQWWRQRWHWKDWWKHVHYDOXHV :LWKUHJDUGWRWKHDERYHOLVWHGSULFHUDQJHVLWLVLPSRUWDQWWRQRWHWKDWWKHVHYDOXHV
RQO\UHIOHFWWKHLQLWLDO H[SHQVHV:HWKLQNWKDWLIDFWXDOFRVWVRIDVWUXFWXUHDUH HVWL RQO\UHIOHFWWKHLQLWLDO H[SHQVHV:HWKLQNWKDWLIDFWXDOFRVWVRIDVWUXFWXUHDUH HVWL
PDWHGWKHVHUYLFHOLIHLVWREHWDNHQLQWRFRQVLGHUDWLRQLHFRVWVVKRXOGEHH[SUHVVHG PDWHGWKHVHUYLFHOLIHLVWREHWDNHQLQWRFRQVLGHUDWLRQLHFRVWVVKRXOGEHH[SUHVVHG
EDVHGRQOLIHF\FOHFRVWLQJ FI6HFWLRQ %DVHGRQOLIHF\FOHFRVWLQJHYHQH[SHQ EDVHGRQOLIHF\FOHFRVWLQJ FI6HFWLRQ %DVHGRQOLIHF\FOHFRVWLQJHYHQH[SHQ
VLYH EXWHIIHFWLYH FRXQWHUPHDVXUHVDVVWDLQOHVVVWHHODQG&3UH DQG&3 FDQEHDW VLYH EXWHIIHFWLYH FRXQWHUPHDVXUHVDVVWDLQOHVVVWHHODQG&3UH DQG&3 FDQEHDW
WUDFWLYHVROXWLRQV WUDFWLYHVROXWLRQV

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

 &RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV  &RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV


$OWKRXJKWKHIRFXVRIWKLVSURMHFWZDVVHWRQWKHGHYHORSPHQWRIFRXQWHUPHDVXUHVIRU $OWKRXJKWKHIRFXVRIWKLVSURMHFWZDVVHWRQWKHGHYHORSPHQWRIFRXQWHUPHDVXUHVIRU
QHZ VWUXFWXUHV UDWKHU WKDQ RQ UHSDLU DQG UHKDELOLWDWLRQ WHFKQLTXHV LH FRXQWHUPHD QHZ VWUXFWXUHV UDWKHU WKDQ RQ UHSDLU DQG UHKDELOLWDWLRQ WHFKQLTXHV LH FRXQWHUPHD
VXUHVIRUH[LVWLQJVWUXFWXUHV FI6HFWLRQ ZHWKLQNWKDWVLPLODUSULQFLSOHVIRUWKH VXUHVIRUH[LVWLQJVWUXFWXUHV FI6HFWLRQ ZHWKLQNWKDWVLPLODUSULQFLSOHVIRUWKH
WKHUPRG\QDPLF GHVFULSWLRQ FDQ EH XVHG LQ WKLV UHJDUG )XUWKHUPRUH VSHFLILF LPSOH WKHUPRG\QDPLF GHVFULSWLRQ FDQ EH XVHG LQ WKLV UHJDUG )XUWKHUPRUH VSHFLILF LPSOH
PHQWDWLRQV RI WKH SURSRVHG QHZ FRXQWHUPHDVXUHV FI &KDSWHU   DUH DSSOLFDEOH IRU PHQWDWLRQV RI WKH SURSRVHG QHZ FRXQWHUPHDVXUHV FI &KDSWHU   DUH DSSOLFDEOH IRU
UHSDLURIH[LVWLQJVWUXFWXUHV6RVHOHFWHGFRXQWHUPHDVXUHVDUHEULHIO\GHVFULEHGLQWKLV UHSDLURIH[LVWLQJVWUXFWXUHV6RVHOHFWHGFRXQWHUPHDVXUHVDUHEULHIO\GHVFULEHGLQWKLV
6HFWLRQ7KHIROORZLQJFRXQWHUPHDVXUHVDUHDSSOLHGRUKDYHEHHQSURSRVHGIRUUHKD 6HFWLRQ7KHIROORZLQJFRXQWHUPHDVXUHVDUHDSSOLHGRUKDYHEHHQSURSRVHGIRUUHKD
ELOLWDWLRQRUUHSDLURIH[LVWLQJVWUXFWXUHV ELOLWDWLRQRUUHSDLURIH[LVWLQJVWUXFWXUHV
‡ &RQFUHWHVXUIDFHSURWHFWLRQDQGFUDFNLQMHFWLRQ ‡ &RQFUHWHVXUIDFHSURWHFWLRQDQGFUDFNLQMHFWLRQ
‡ 'LIIXVLRQLQKLELWRUV ‡ 'LIIXVLRQLQKLELWRUV
‡ (OHFWURFKHPLFDOWHFKQLTXHV 6HFWLRQ  ‡ (OHFWURFKHPLFDOWHFKQLTXHV 6HFWLRQ 
ƕ &DWKRGLFSURWHFWLRQµ&3¶ ƕ &DWKRGLFSURWHFWLRQµ&3¶
ƕ (OHFWURFKHPLFDOUHDONDOLVDWLRQµ(5$¶ ƕ (OHFWURFKHPLFDOUHDONDOLVDWLRQµ(5$¶
ƕ (OHFWURFKHPLFDOFKORULGHUHPRYDOµ(&5¶ ƕ (OHFWURFKHPLFDOFKORULGHUHPRYDOµ(&5¶
‡ &RQFUHWHSDWFKUHSDLU 6HFWLRQ  ‡ &RQFUHWHSDWFKUHSDLU 6HFWLRQ 
,QDGGLWLRQWRWKHWH[WERRNVOLVWHGLQ6HFWLRQZKLFKDOVRGHDOZLWKUHSDLUDQGUH ,QDGGLWLRQWRWKHWH[WERRNVOLVWHGLQ6HFWLRQZKLFKDOVRGHDOZLWKUHSDLUDQGUH
KDELOLWDWLRQWHFKQLTXHVWRDVPDOOHURUODUJHUH[WHQWDQGWKHUHODWHGVWDQGDUGVLHWKH KDELOLWDWLRQWHFKQLTXHVWRDVPDOOHURUODUJHUH[WHQWDQGWKHUHODWHGVWDQGDUGVLHWKH
(1VHULHV>'6(1@DQG>$&,HWDO$&,5@WKHUH (1VHULHV>'6(1@DQG>$&,HWDO$&,5@WKHUH
DUHRWKHUJXLGHOLQHVGHDOLQJH[FOXVLYHO\ZLWKWKHUHSDLURIFRQFUHWHGDPDJHGE\UHLQ DUHRWKHUJXLGHOLQHVGHDOLQJH[FOXVLYHO\ZLWKWKHUHSDLURIFRQFUHWHGDPDJHGE\UHLQ
IRUFHPHQWFRUURVLRQHJ &6  IRUFHPHQWFRUURVLRQHJ &6 
$IWHUDEULHIVXPPDU\RIWKHHVVHQWLDOLQIRUPDWLRQRQWKHVHUHSDLUDQGUHKDELOLWDWLRQ $IWHUDEULHIVXPPDU\RIWKHHVVHQWLDOLQIRUPDWLRQRQWKHVHUHSDLUDQGUHKDELOLWDWLRQ
WHFKQLTXHVWKHDSSOLFDWLRQRIWKHUPRG\QDPLFVLQFRQFUHWHUHSDLUZLOOEHSUHVHQWHGLQ WHFKQLTXHVWKHDSSOLFDWLRQRIWKHUPRG\QDPLFVLQFRQFUHWHUHSDLUZLOOEHSUHVHQWHGLQ
6HFWLRQ  (OHFWURFKHPLFDO WHFKQLTXHV DQG SDWFK UHSDLU DUH GHDOW ZLWK VHSDUDWHO\ 6HFWLRQ  (OHFWURFKHPLFDO WHFKQLTXHV DQG SDWFK UHSDLU DUH GHDOW ZLWK VHSDUDWHO\
6HFWLRQVDQGUHVSHFWLYHO\ LQVOLJKWO\PRUHGHWDLOVLQFHWKH\UHODWHWRRXU 6HFWLRQVDQGUHVSHFWLYHO\ LQVOLJKWO\PRUHGHWDLOVLQFHWKH\UHODWHWRRXU
SULQFLSOHVSURSRVHGLQ&KDSWHU SULQFLSOHVSURSRVHGLQ&KDSWHU
7KH PRVW LPSRUWDQW EDFNJURXQG RI FRQFUHWH VXUIDFH SURWHFWLRQ ZKLFK LQ SULQFLSOH 7KH PRVW LPSRUWDQW EDFNJURXQG RI FRQFUHWH VXUIDFH SURWHFWLRQ ZKLFK LQ SULQFLSOH
DOVRDSSOLHVWRFUDFNLQMHFWLRQDQGFRUURVLRQLQKLELWRUVZDVDOUHDG\GLVFXVVHGLQ6HF DOVRDSSOLHVWRFUDFNLQMHFWLRQDQGFRUURVLRQLQKLELWRUVZDVDOUHDG\GLVFXVVHGLQ6HF
WLRQV  DQG  UHVSHFWLYHO\ 7KHUHIRUH RQO\ WKH VSHFLDO FKDUDFWHULVWLFV RI WLRQV  DQG  UHVSHFWLYHO\ 7KHUHIRUH RQO\ WKH VSHFLDO FKDUDFWHULVWLFV RI
WKHLUDSSOLFDWLRQDVFRXQWHUPHDVXUHVIRUH[LVWLQJVWUXFWXUHVDUHEULHIO\JLYHQ WKHLUDSSOLFDWLRQDVFRXQWHUPHDVXUHVIRUH[LVWLQJVWUXFWXUHVDUHEULHIO\JLYHQ
‡ &RQFUHWHVXUIDFHSURWHFWLRQDQGFUDFNLQMHFWLRQ ‡ &RQFUHWHVXUIDFHSURWHFWLRQDQGFUDFNLQMHFWLRQ
&RQFUHWHVXUIDFHSURWHFWLRQDQGFUDFNLQMHFWLRQDUHVWDQGDUGLVHGLQ>'6(1 &RQFUHWHVXUIDFHSURWHFWLRQDQGFUDFNLQMHFWLRQDUHVWDQGDUGLVHGLQ>'6(1
@DQG>'6(1@UHVSHFWLYHO\%HVLGHV>$&,5$&, @DQG>'6(1@UHVSHFWLYHO\%HVLGHV>$&,5$&,
HW DO  $&, 5 @ D UHOHYDQW 86 SXEOLFDWLRQ LV WKH $&, UHSRUW RQ HW DO  $&, 5 @ D UHOHYDQW 86 SXEOLFDWLRQ LV WKH $&, UHSRUW RQ
HYDOXDWLRQ DQG UHSDLU RI FUDFNV LQ FRQFUHWH VWUXFWXUHV >$&, 5 @ $V HYDOXDWLRQ DQG UHSDLU RI FUDFNV LQ FRQFUHWH VWUXFWXUHV >$&, 5 @ $V
PHQWLRQHGLQ6HFWLRQZHGRQRWFRQVLGHUFRQFUHWHVXUIDFHSURWHFWLRQDVDQ PHQWLRQHGLQ6HFWLRQZHGRQRWFRQVLGHUFRQFUHWHVXUIDFHSURWHFWLRQDVDQ
RSWLRQ IRU UHSDLU RI VWUXFWXUHV WKDW DUH VXEVWDQWLDOO\ FRQWDPLQDWHG E\ FKORULGH RU RSWLRQ IRU UHSDLU RI VWUXFWXUHV WKDW DUH VXEVWDQWLDOO\ FRQWDPLQDWHG E\ FKORULGH RU

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV

ZKHUH FRUURVLRQ KDV DOUHDG\ LQLWLDWHG VLQFH LQLWLDWLRQ RU SURSDJDWLRQ ZLOO QRW EH ZKHUH FRUURVLRQ KDV DOUHDG\ LQLWLDWHG VLQFH LQLWLDWLRQ RU SURSDJDWLRQ ZLOO QRW EH
SUHYHQWHG7KHVDPHKROGVIRUFUDFNLQMHFWLRQZLWKHJHSR[\6HDOLQJRIFUDFNV SUHYHQWHG7KHVDPHKROGVIRUFUDFNLQMHFWLRQZLWKHJHSR[\6HDOLQJRIFUDFNV
FDQKRZHYHUEHDQHIIHFWLYH³ILUVWDLG´WROLPLWWKHLUFRQWULEXWLRQLQDFFHOHUDWLQJ FDQKRZHYHUEHDQHIIHFWLYH³ILUVWDLG´WROLPLWWKHLUFRQWULEXWLRQLQDFFHOHUDWLQJ
WKH LQLWLDWLRQ DQG SURSDJDWLRQ RI UHLQIRUFHPHQW FRUURVLRQ FI 6HFWLRQ   WKH LQLWLDWLRQ DQG SURSDJDWLRQ RI UHLQIRUFHPHQW FRUURVLRQ FI 6HFWLRQ  
JLYHQWKDWWKHFUDFNVDUHQRWVHDOHGRQO\VXSHUILFLDOO\EXWGRZQWRWKHOHYHORIWKH JLYHQWKDWWKHFUDFNVDUHQRWVHDOHGRQO\VXSHUILFLDOO\EXWGRZQWRWKHOHYHORIWKH
UHLQIRUFHPHQW>0DUFRWWH +DQVVRQ@ UHLQIRUFHPHQW>0DUFRWWH +DQVVRQ@
‡ 'LIIXVLRQLQKLELWRUV ‡ 'LIIXVLRQLQKLELWRUV
:KHQLQKLELWRUVDUHDSSOLHGWRWKHVXUIDFHRIKDUGHQHGFRQFUHWHGXULQJWKHLQLWLD :KHQLQKLELWRUVDUHDSSOLHGWRWKHVXUIDFHRIKDUGHQHGFRQFUHWHGXULQJWKHLQLWLD
WLRQSKDVHWKHPRGHRIDFWLRQLVSULQFLSDOO\LGHQWLFDOWRWKHRQHRILQWHJUDOLQKLEL WLRQSKDVHWKHPRGHRIDFWLRQLVSULQFLSDOO\LGHQWLFDOWRWKHRQHRILQWHJUDOLQKLEL
WRUV SURYLGHG WKDW WKH QHFHVVDU\ FRQFHQWUDWLRQ DW WKH UHLQIRUFHPHQW LV DWWDLQHG WRUV SURYLGHG WKDW WKH QHFHVVDU\ FRQFHQWUDWLRQ DW WKH UHLQIRUFHPHQW LV DWWDLQHG
>%HUWROLQL HWDO @ &RPSOH[HV WKDW KDYH EHHQ SURSRVHG DQG WHVWHG IRU WKDW >%HUWROLQL HWDO @ &RPSOH[HV WKDW KDYH EHHQ SURSRVHG DQG WHVWHG IRU WKDW
SXUSRVHDUHPDLQO\EDVHGRQRUJDQLFFRPSRXQGVHJDONDQRODPLQHVDQGDPLQHV SXUSRVHDUHPDLQO\EDVHGRQRUJDQLFFRPSRXQGVHJDONDQRODPLQHVDQGDPLQHV
VRGLXPPRQRIOXRURSKRVSKDWHDQGUHFHQWO\DOVRFDOFLXPQLWULWH>(OVHQHU@ VRGLXPPRQRIOXRURSKRVSKDWHDQGUHFHQWO\DOVRFDOFLXPQLWULWH>(OVHQHU@
,Q6HFWLRQLWKDVEHHQDUJXHGWKDWWKHPRGHRIDFWLRQRIVRPHLQWHJUDOFRU ,Q6HFWLRQLWKDVEHHQDUJXHGWKDWWKHPRGHRIDFWLRQRIVRPHLQWHJUDOFRU
URVLRQLQKLELWRUVDVZHOODVWKHLUFRQWULEXWLRQWRGXUDELOLW\ZLWKUHJDUGWRWKHORQJ URVLRQLQKLELWRUVDVZHOODVWKHLUFRQWULEXWLRQWRGXUDELOLW\ZLWKUHJDUGWRWKHORQJ
VHUYLFHOLIHRIFRQFUHWHVWUXFWXUHVPD\EHGRXEWIXO)XUWKHUPRUHZHFRQVLGHUWKDW VHUYLFHOLIHRIFRQFUHWHVWUXFWXUHVPD\EHGRXEWIXO)XUWKHUPRUHZHFRQVLGHUWKDW
DWWDLQLQJDQGNHHSLQJRIWKHQHFHVVDU\FRQFHQWUDWLRQLVDPDMRULVVXHIRUGLIIXVLRQ DWWDLQLQJDQGNHHSLQJRIWKHQHFHVVDU\FRQFHQWUDWLRQLVDPDMRULVVXHIRUGLIIXVLRQ
LQKLELWRUV7KHPRVWLPSRUWDQWREVWDFOHVWKDWLQWHUIHUHZLWKWKHSHQHWUDWLRQRIWKH LQKLELWRUV7KHPRVWLPSRUWDQWREVWDFOHVWKDWLQWHUIHUHZLWKWKHSHQHWUDWLRQRIWKH
LQKLELWRUVUHODWHWRWKHWKHRU\GHVFULEHGLQ6HFWLRQDQGHJSRRUGLIIX LQKLELWRUVUHODWHWRWKHWKHRU\GHVFULEHGLQ6HFWLRQDQGHJSRRUGLIIX
VLRQ LQ VDWXUDWHG FRQFUHWH DV ZHOO DV SRVVLEOH RXWZDUGV GLIIXVLRQ )LQDOO\ LW KDV VLRQ LQ VDWXUDWHG FRQFUHWH DV ZHOO DV SRVVLEOH RXWZDUGV GLIIXVLRQ )LQDOO\ LW KDV
EHHQVXJJHVWHGWKDWUHDFWLRQVEHWZHHQLQRUJDQLFFRPSRQHQWVRIFRPPHUFLDOGLIIX EHHQVXJJHVWHGWKDWUHDFWLRQVEHWZHHQLQRUJDQLFFRPSRQHQWVRIFRPPHUFLDOGLIIX
VLRQLQKLELWRUEOHQGVUHDFWZLWKWKHFHPHQWPDWUL[DQGEORFNSRUHVZKLFKOLPLWV VLRQLQKLELWRUEOHQGVUHDFWZLWKWKHFHPHQWPDWUL[DQGEORFNSRUHVZKLFKOLPLWV
IXUWKHUSHQHWUDWLRQ IXUWKHUSHQHWUDWLRQ

 (OHFWURFKHPLFDO7HFKQLTXHV  (OHFWURFKHPLFDO7HFKQLTXHV


%HVLGHVµ&3UH¶DVDQLQLWLDOFRXQWHUPHDVXUHIRU QHZVWUXFWXUHV FI6HFWLRQ  %HVLGHVµ&3UH¶DVDQLQLWLDOFRXQWHUPHDVXUHIRU QHZVWUXFWXUHV FI6HFWLRQ 
WKUHHUHOHYDQWHOHFWURFKHPLFDOWHFKQLTXHVH[LVWIRUUHKDELOLWDWLRQRIH[LVWLQJVWUXFWXUHV WKUHHUHOHYDQWHOHFWURFKHPLFDOWHFKQLTXHVH[LVWIRUUHKDELOLWDWLRQRIH[LVWLQJVWUXFWXUHV
LHµ&3¶HOHFWURFKHPLFDOUHDONDOLVDWLRQµ(5$¶DQGHOHFWURFKHPLFDOFKORULGHUHPRYDO LHµ&3¶HOHFWURFKHPLFDOUHDONDOLVDWLRQµ(5$¶DQGHOHFWURFKHPLFDOFKORULGHUHPRYDO
µ(&5¶ µ(&5¶
µ&3¶LVVWDQGDUGLVHGLQ>'6(1@DQGGHVFULEHGLQ>$&,HWDO$&, µ&3¶LVVWDQGDUGLVHGLQ>'6(1@DQGGHVFULEHGLQ>$&,HWDO$&,
5@0RUHRYHUVHYHUDOJXLGHOLQHVDQGKDQGERRNVSURYLGHH[WHQVLYHLQIRUPD 5@0RUHRYHUVHYHUDOJXLGHOLQHVDQGKDQGERRNVSURYLGHH[WHQVLYHLQIRUPD
WLRQRQµ&3¶RIVWHHOLQFRQFUHWHHJ>&6&KHVV@µ(5$¶LVVWDQGDUGLVHG WLRQRQµ&3¶RIVWHHOLQFRQFUHWHHJ>&6&KHVV@µ(5$¶LVVWDQGDUGLVHG
DQGµ(&5¶ZDVPHDQWWREHVWDQGDUGLVHGLQ(1³(OHFWURFKHPLFDOUHDONDOLVDWLRQ DQGµ(&5¶ZDVPHDQWWREHVWDQGDUGLVHGLQ(1³(OHFWURFKHPLFDOUHDONDOLVDWLRQ
DQG FKORULGH H[WUDFWLRQ WUHDWPHQWV IRU UHLQIRUFHG FRQFUHWH´ 3DUW  ³5HDONDOLVDWLRQ´ DQG FKORULGH H[WUDFWLRQ WUHDWPHQWV IRU UHLQIRUFHG FRQFUHWH´ 3DUW  ³5HDONDOLVDWLRQ´
KDV EHHQ SXEOLVKHG >'6&(176  @ ZKHUHDV DFFRUGLQJ WR KDV EHHQ SXEOLVKHG >'6&(176  @ ZKHUHDV DFFRUGLQJ WR
>*XGPXQGVVRQHWDO@WKHUHLVQRPDQGDWHWRZRUNRQSDUW³&KORULGHH[WUDF >*XGPXQGVVRQHWDO@WKHUHLVQRPDQGDWHWRZRUNRQSDUW³&KORULGHH[WUDF
WLRQWUHDWPHQW´DWSUHVHQWDQGLWZLOOQRWEHSXEOLVKHGLQWKHIRUHVHHDEOHIXWXUH+RZ WLRQWUHDWPHQW´DWSUHVHQWDQGLWZLOOQRWEHSXEOLVKHGLQWKHIRUHVHHDEOHIXWXUH+RZ
HYHU VHYHUDO UHSRUWV DQG JXLGHOLQHV GHDO ZLWK µ(5$¶ DQG µ(&5¶ HJ >0LHW] @ HYHU VHYHUDO UHSRUWV DQG JXLGHOLQHV GHDO ZLWK µ(5$¶ DQG µ(&5¶ HJ >0LHW] @
DQG>6KDUSHWDO6KDUS 9LUPDQL@UHVSHFWLYHO\ DQG>6KDUSHWDO6KDUS 9LUPDQL@UHVSHFWLYHO\

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

$V IRU µ&3UH¶ WKH VWHHO LV VXEMHFWHG WR FDWKRGLF SRODULVDWLRQ IRU µ&3¶ µ(5$¶ DQG $V IRU µ&3UH¶ WKH VWHHO LV VXEMHFWHG WR FDWKRGLF SRODULVDWLRQ IRU µ&3¶ µ(5$¶ DQG
µ(&5¶EXWWKHDSSOLHGFXUUHQWGHQVLWLHVGLIIHUWRDODUJHH[WHQW)RUHFRQRPLFDOUHD µ(&5¶EXWWKHDSSOLHGFXUUHQWGHQVLWLHVGLIIHUWRDODUJHH[WHQW)RUHFRQRPLFDOUHD
VRQV WKH DSSOLFDWLRQ RI µ&3¶ LV QRUPDOO\ OLPLWHG WR FRUURVLRQ SURWHFWLRQ LQ FKORULGH VRQV WKH DSSOLFDWLRQ RI µ&3¶ LV QRUPDOO\ OLPLWHG WR FRUURVLRQ SURWHFWLRQ LQ FKORULGH
FRQWDPLQDWHG FRQFUHWH 7KH UHLQIRUFHPHQW LV SRODULVHG VR WKDW IXOO SURWHFWLRQ LV RE FRQWDPLQDWHG FRQFUHWH 7KH UHLQIRUFHPHQW LV SRODULVHG VR WKDW IXOO SURWHFWLRQ LV RE
WDLQHG ZKLFK GHSHQGLQJ RQ WKH GHJUHH RI FRQWDPLQDWLRQ WKHUPRG\QDPLFDOO\ FRUUH WDLQHG ZKLFK GHSHQGLQJ RQ WKH GHJUHH RI FRQWDPLQDWLRQ WKHUPRG\QDPLFDOO\ FRUUH
VSRQGV WR LPPXQLW\ RU PDJQLWXGHV RI µ(FRUU¶ FORVH WR LPPXQLW\ FI 6HFWLRQV  VSRQGV WR LPPXQLW\ RU PDJQLWXGHV RI µ(FRUU¶ FORVH WR LPPXQLW\ FI 6HFWLRQV 
DQG ,QJHQHUDOFXUUHQWGHQVLWLHVEHWZHHQP$PDUHDSSOLHGGXULQJµ&3¶ DQG ,QJHQHUDOFXUUHQWGHQVLWLHVEHWZHHQP$PDUHDSSOLHGGXULQJµ&3¶
>%HUWROLQL HWDO @ %HVLGHV ORZHULQJ WKH SRWHQWLDO RI WKH UHLQIRUFHPHQW ERWK >%HUWROLQL HWDO @ %HVLGHV ORZHULQJ WKH SRWHQWLDO RI WKH UHLQIRUFHPHQW ERWK
µ&3UH¶DQGµ&3¶LQYROYHLRQPLJUDWLRQLQWKHFRQFUHWHDVZHOODVFDWKRGLFUHDFWLRQVRQ µ&3UH¶DQGµ&3¶LQYROYHLRQPLJUDWLRQLQWKHFRQFUHWHDVZHOODVFDWKRGLFUHDFWLRQVRQ
WKHVWHHOVXUIDFH7KHVHDVSHFWVDUHWKHEDVLVIRUµ(5$¶DQGµ(&5¶0XFKKLJKHUFXU WKHVWHHOVXUIDFH7KHVHDVSHFWVDUHWKHEDVLVIRUµ(5$¶DQGµ(&5¶0XFKKLJKHUFXU
UHQW GHQVLWLHV LH LQ WKH RUGHU RI  P$P >%HUWROLQL HWDO @ DUH UH UHQW GHQVLWLHV LH LQ WKH RUGHU RI  P$P >%HUWROLQL HWDO @ DUH UH
TXLUHGWRREWDLQWKHGHVLUHGHIIHFWVLHWRHOHFWURFKHPLFDOO\UHKDELOLWDWHWKHFRQFUHWH TXLUHGWRREWDLQWKHGHVLUHGHIIHFWVLHWRHOHFWURFKHPLFDOO\UHKDELOLWDWHWKHFRQFUHWH
ZKLFKLVFDUERQDWHGRUFKORULGHFRQWDPLQDWHGUHVSHFWLYHO\7KHGHVLUHGFDWKRGLFUH ZKLFKLVFDUERQDWHGRUFKORULGHFRQWDPLQDWHGUHVSHFWLYHO\7KHGHVLUHGFDWKRGLFUH
DFWLRQVDQGLRQLFFXUUHQWVLQµ(5$¶DQGµ(&5¶DUH DFWLRQVDQGLRQLFFXUUHQWVLQµ(5$¶DQGµ(&5¶DUH
‡ &DWKRGLFUHDFWLRQV FI6HFWLRQ  ‡ &DWKRGLFUHDFWLRQV FI6HFWLRQ 

 2  + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@  2  + +  2 + H − → 2+ − (( 
 =  {} P96+( )  >@

 +  2 + H − → +  + 2+ − (( 
 = −  ^−` P96+( )  >@  +  2 + H − → +  + 2+ − (( 
 = −  ^−` P96+( )  >@

7KH UHGXFWLRQ RI ZDWHU >@ RQO\ WDNHV SODFH DW YHU\ ORZ SRWHQWLDOV DQG + LV 7KH UHGXFWLRQ RI ZDWHU >@ RQO\ WDNHV SODFH DW YHU\ ORZ SRWHQWLDOV DQG + LV
IRUPHG +RZHYHU ERWK UHDFWLRQV IRUP K\GUR[\O LRQV DQG WKXV LQFUHDVH WKH ORFDO IRUPHG +RZHYHU ERWK UHDFWLRQV IRUP K\GUR[\O LRQV DQG WKXV LQFUHDVH WKH ORFDO
DONDOLQLW\DWWKHFRQFUHWHVWHHOLQWHUIDFH DONDOLQLW\DWWKHFRQFUHWHVWHHOLQWHUIDFH
‡ ,RQLFFXUUHQW FI6HFWLRQVDQG  ‡ ,RQLFFXUUHQW FI6HFWLRQVDQG 
6LPLODU WR FRUURVLRQ SURFHVVHV FI 6HFWLRQ   WKH FLUFXODWLRQ RI FXUUHQW 6LPLODU WR FRUURVLRQ SURFHVVHV FI 6HFWLRQ   WKH FLUFXODWLRQ RI FXUUHQW
WKURXJKFRQFUHWHLHWKHLRQLFFXUUHQWLVEDVHGRQWKHPLJUDWLRQRILRQVSUHVHQWLQ WKURXJKFRQFUHWHLHWKHLRQLFFXUUHQWLVEDVHGRQWKHPLJUDWLRQRILRQVSUHVHQWLQ
WKHSRUHVROXWLRQLHFDWLRQVHJ+.1DDQG&DPLJUDWHWRZDUGVWKHVWHHO WKHSRUHVROXWLRQLHFDWLRQVHJ+.1DDQG&DPLJUDWHWRZDUGVWKHVWHHO
ZKHUHDVDQLRQVHJ2+í62íDQG&OíPLJUDWHLQWKHRSSRVLWHGLUHFWLRQ ZKHUHDVDQLRQVHJ2+í62íDQG&OíPLJUDWHLQWKHRSSRVLWHGLUHFWLRQ
,QWKLVFRQQHFWLRQWKHPDMRUSDUWRIWKHFLUFXODWLQJFXUUHQWLVFDUULHGE\K\GUR[\OLRQV ,QWKLVFRQQHFWLRQWKHPDMRUSDUWRIWKHFLUFXODWLQJFXUUHQWLVFDUULHGE\K\GUR[\OLRQV
FI6HFWLRQ DQGWKXVDODUJHSRUWLRQRIWKHK\GUR[\OLRQVSURGXFHGE\WKHFD FI6HFWLRQ DQGWKXVDODUJHSRUWLRQRIWKHK\GUR[\OLRQVSURGXFHGE\WKHFD
WKRGLF UHDFWLRQV >@ DQG >@ LV UHPRYHG IURP WKH UHLQIRUFHPHQW VXUIDFH DQG PL WKRGLF UHDFWLRQV >@ DQG >@ LV UHPRYHG IURP WKH UHLQIRUFHPHQW VXUIDFH DQG PL
JUDWHVWRZDUGVWKHH[WHUQDODQRGH+RZHYHUDFHUWDLQSDUWLVEDODQFHGE\VRGLXPLRQV JUDWHVWRZDUGVWKHH[WHUQDODQRGH+RZHYHUDFHUWDLQSDUWLVEDODQFHGE\VRGLXPLRQV
PLJUDWLQJWRZDUGVWKHUHLQIRUFHPHQWDQGLQLWLDOS+YDOXHVFORVHWRFDQEHREWDLQHG PLJUDWLQJWRZDUGVWKHUHLQIRUFHPHQWDQGLQLWLDOS+YDOXHVFORVHWRFDQEHREWDLQHG
>%HUWROLQLHWDO@7KHLQLWLDOS+LVEDODQFHGE\WKHK\GUR[\OLRQVUHDFWLQJZLWK >%HUWROLQLHWDO@7KHLQLWLDOS+LVEDODQFHGE\WKHK\GUR[\OLRQVUHDFWLQJZLWK
DWPRVSKHULF&2DQGJHQHUDOO\VWDELOLVHVDWYDOXHVDURXQG>%HUWROLQLHWDO@ DWPRVSKHULF&2DQGJHQHUDOO\VWDELOLVHVDWYDOXHVDURXQG>%HUWROLQLHWDO@
7KHIUDFWLRQRIFXUUHQWFDUULHGE\WKHFKORULGHVLVUHODWLYHO\VPDOODQGIXUWKHUPRUHLW 7KHIUDFWLRQRIFXUUHQWFDUULHGE\WKHFKORULGHVLVUHODWLYHO\VPDOODQGIXUWKHUPRUHLW
GHFUHDVHVZLWKGHFUHDVLQJFKORULGHFRQFHQWUDWLRQ FI6HFWLRQ 7KXVKLJKFXU GHFUHDVHVZLWKGHFUHDVLQJFKORULGHFRQFHQWUDWLRQ FI6HFWLRQ 7KXVKLJKFXU
UHQWGHQVLWLHVDUHUHTXLUHGWRUHPRYHODUJHTXDQWLWLHVRIFKORULGHVIURPWKHUHLQIRUFH UHQWGHQVLWLHVDUHUHTXLUHGWRUHPRYHODUJHTXDQWLWLHVRIFKORULGHVIURPWKHUHLQIRUFH
PHQW RUWRSUHYHQWWKHLULQJUHVVLQWRQHZVWUXFWXUHV >%HUWROLQLHWDO@ PHQW RUWRSUHYHQWWKHLULQJUHVVLQWRQHZVWUXFWXUHV >%HUWROLQLHWDO@
7KHVHHOHFWURFKHPLFDOUHDFWLRQVDQGWUDQVSRUWPHFKDQLVPVDUHWKHEDVLVRIµ(5$¶DQG 7KHVHHOHFWURFKHPLFDOUHDFWLRQVDQGWUDQVSRUWPHFKDQLVPVDUHWKHEDVLVRIµ(5$¶DQG
µ(&5¶EXWWKH\DUHDOVRDGHFLVLYHIDFWRUIRUWKHORQJWHUPRSHUDWLRQRIµ&3UH¶DQG µ(&5¶EXWWKH\DUHDOVRDGHFLVLYHIDFWRUIRUWKHORQJWHUPRSHUDWLRQ RI µ&3UH¶DQG

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV

µ&3¶ <HW WKH GHVLUHG UHDFWLRQV FDQ DOVR LQYROYH QHJDWLYH VLGH HIIHFWV LQ SDUWLFXODU µ&3¶ <HW WKH GHVLUHG UHDFWLRQV FDQ DOVR LQYROYH QHJDWLYH VLGH HIIHFWV LQ SDUWLFXODU
K\GURJHQHPEULWWOHPHQW FI6HFWLRQ µ$65¶ FI6HFWLRQ DQGORVVRIERQG K\GURJHQHPEULWWOHPHQW FI6HFWLRQ µ$65¶ FI6HFWLRQ DQGORVVRIERQG
VWUHQJWK VWUHQJWK
'XHWRLQFUHDVLQJILHOG H[SHULHQFHWKHFRQILGHQFHLQHOHFWURFKHPLFDOWHFKQLTXHVIRU 'XHWRLQFUHDVLQJILHOG H[SHULHQFHWKHFRQILGHQFHLQHOHFWURFKHPLFDOWHFKQLTXHVIRU
H[LVWLQJFRQFUHWHVWUXFWXUHLVJURZLQJ,QFRQWUDVWWRFRQFUHWHSDWFKUHSDLU FI6HFWLRQ H[LVWLQJFRQFUHWHVWUXFWXUHLVJURZLQJ,QFRQWUDVWWRFRQFUHWHSDWFKUHSDLU FI6HFWLRQ
 WKHEHQHILWRIDOOWKHVHWHFKQLTXHVLVWKDWRQO\WKHSK\VLFDOO\GDPDJHGFRQFUHWH  WKHEHQHILWRIDOOWKHVHWHFKQLTXHVLVWKDWRQO\WKHSK\VLFDOO\GDPDJHGFRQFUHWH
FRYHUQHHGVWREHUHPRYHGDQGUHSDLUHGZKLOHWKHHOHFWURFKHPLFDOWHFKQLTXHVHQDEOH FRYHUQHHGVWREHUHPRYHGDQGUHSDLUHGZKLOHWKHHOHFWURFKHPLFDOWHFKQLTXHVHQDEOH
FRUURVLRQSURWHFWLRQRIWKHVWHHO FRUURVLRQSURWHFWLRQRIWKHVWHHO
)RU µ&3UH¶ DQG µ&3¶ DGGLWLRQDO LQVWDOODWLRQV DQG DSURYLVLRQ RI FRQWLQXRXV HOHFWULFDO )RU µ&3UH¶ DQG µ&3¶ DGGLWLRQDO LQVWDOODWLRQV DQG DSURYLVLRQ RI FRQWLQXRXV HOHFWULFDO
FRQQHFWLRQ FI6HFWLRQ RIWKHUHLQIRUFHPHQWDUHUHTXLUHGDQGRQFHDSSOLHG FRQQHFWLRQ FI 6HFWLRQ   RI WKH UHLQIRUFHPHQW DUH UHTXLUHG DQG RQFHDSSOLHG
WKH\PXVWRSHUDWHIRUWKHUHPDLQLQJVHUYLFHOLIHRIWKHVWUXFWXUH1HYHUWKHOHVVEDVHG WKH\PXVWRSHUDWHIRUWKHUHPDLQLQJVHUYLFHOLIHRIWKHVWUXFWXUH1HYHUWKHOHVVEDVHG
RQOLIHF\FOHFRVWLQJDQGWKHH[LVWLQJDOWHUQDWLYHVZHFRQVLGHUµ&3UH¶RUWKHSURYLVLRQ RQOLIHF\FOHFRVWLQJDQGWKHH[LVWLQJDOWHUQDWLYHVZHFRQVLGHUµ&3UH¶RUWKHSURYLVLRQ
IRUµ&3¶DVRSWLRQVIRUFRUURVLRQSURWHFWLRQIRUFHUWDLQW\SHVRIVWUXFWXUHVµ(5$¶DQG IRUµ&3¶DVRSWLRQVIRUFRUURVLRQSURWHFWLRQIRUFHUWDLQW\SHVRIVWUXFWXUHVµ(5$¶DQG
µ(&5¶ QHHG RQO\ WR EH DSSOLHG IRU D OLPLWHG SHULRG RI WLPH RI WKH RUGHU RI D IHZ µ(&5¶ QHHG RQO\ WR EH DSSOLHG IRU D OLPLWHG SHULRG RI WLPH RI WKH RUGHU RI D IHZ
ZHHNVDQGDIHZPRQWKVUHVSHFWLYHO\ DQGWKH\PD\EHHIIHFWLYHEXWZHGRQRWFRQ ZHHNVDQGDIHZPRQWKVUHVSHFWLYHO\ DQGWKH\PD\EHHIIHFWLYHEXWZHGRQRWFRQ
VLGHUWKHPWREHHIIHFWLYHRQDODUJHVFDOH+RZHYHUDVWKHRULJLQDOFRQFUHWHVXUIDFH VLGHUWKHPWREHHIIHFWLYHRQDODUJHVFDOH+RZHYHUDVWKHRULJLQDOFRQFUHWHVXUIDFH
UHPDLQVXQFKDQJHGWKHVHWHFKQLTXHVFDQKDYHDGYDQWDJHRXVDSSOLFDWLRQVLQWKHSUHV UHPDLQVXQFKDQJHGWKHVHWHFKQLTXHVFDQKDYHDGYDQWDJHRXVDSSOLFDWLRQVLQWKHSUHV
HUYDWLRQRIVSHFLDODUFKLWHFWXUDOYDOXHVVXFKDVPRQXPHQWV,QWKDWUHODWLRQUHVHDUFK HUYDWLRQRIVSHFLDODUFKLWHFWXUDOYDOXHVVXFKDVPRQXPHQWV,QWKDWUHODWLRQUHVHDUFK
DW'78%\JVKRZHGWKDWWKHVHWHFKQLTXHVLQSDUWLFXODUµ(&5¶DUHQRWOLPLWHGWRFRU DW'78%\JVKRZHGWKDWWKHVHWHFKQLTXHVLQSDUWLFXODUµ(&5¶DUHQRWOLPLWHGWRFRU
URVLRQ SURWHFWLRQ RI VWHHO LQ FRQFUHWH EXW FDQ DOVR EH XVHG EHQHILFLDOO\ LQ HJ WKH URVLRQ SURWHFWLRQ RI VWHHO LQ FRQFUHWH EXW FDQ DOVR EH XVHG EHQHILFLDOO\ LQ HJ WKH
SUHVHUYDWLRQRIPDVRQU\RUPXUDOV>2WWRVHQHWDO5|ULJ'DOJDDUG 2WWRVHQ SUHVHUYDWLRQ RI PDVRQU\ RU PXUDOV>2WWRVHQHWDO5|ULJ'DOJDDUG 2WWRVHQ
@ @

 &RQFUHWH3DWFK5HSDLU  &RQFUHWH3DWFK5HSDLU


&RQFUHWH SDWFK LQ WKH OLWHUDWXUH DOVR UHIHUUHG WR DV FRQYHQWLRQDO  UHSDLU LV WR RXU &RQFUHWH SDWFK LQ WKH OLWHUDWXUH DOVR UHIHUUHG WR DV FRQYHQWLRQDO  UHSDLU LV WR RXU
NQRZOHGJHWKHPRVWFRPPRQO\XVHGPHWKRGIRUUHSDLULQJORFDOLVHGFRUURVLRQGDPDJH NQRZOHGJHWKHPRVWFRPPRQO\XVHGPHWKRGIRUUHSDLULQJORFDOLVHGFRUURVLRQGDPDJH
RIFRQFUHWH%HVLGHVWKHDVVRFLDWHG(1VWDQGDUG>'6(1@DQG86JXLGH RIFRQFUHWH%HVLGHVWKHDVVRFLDWHG(1VWDQGDUG>'6(1@DQG86JXLGH
OLQHV>$&,HWDO$&,5@DQGPRVWRIWKHWH[WERRNVOLVWHGLQ6HFWLRQ OLQHV>$&,HWDO$&,5@DQGPRVWRIWKHWH[WERRNVOLVWHGLQ6HFWLRQ
 VHYHUDO UHSRUWV HJ >&6 @ DQG RWKHU SXEOLFDWLRQV H[LVW RQ WKH VXEMHFW RI  VHYHUDO UHSRUWV HJ >&6 @ DQG RWKHU SXEOLFDWLRQV H[LVW RQ WKH VXEMHFW RI
SDWFKUHSDLU0RVWRIWKHSXEOLFDWLRQVGHDOZLWKWKHHOHFWURFKHPLFDOLQFRPSDWLELOLW\RI SDWFKUHSDLU0RVWRIWKHSXEOLFDWLRQVGHDOZLWKWKHHOHFWURFKHPLFDOLQFRPSDWLELOLW\RI
SDWFK UHSDLUV HJ >5DXSDFK  *X HWDO  (PPRQV  9D\VEXUG  SDWFK UHSDLUV HJ >5DXSDFK  *X HWDO  (PPRQV  9D\VEXUG 
0DLOYDJDQDP  9D\VEXUG  (PPRQV @ DQG ZLWK WKH H[LVWHQFH RI PDFUR 0DLOYDJDQDP  9D\VEXUG  (PPRQV @ DQG ZLWK WKH H[LVWHQFH RI PDFUR
FHOOVZKLFKKDVEHHQ H[SHULPHQWDOO\ GHPRQVWUDWHGLQHJ>:KHDW +DUGLQJ FHOOVZKLFKKDVEHHQ H[SHULPHQWDOO\ GHPRQVWUDWHGLQHJ>:KHDW +DUGLQJ
&XVVRQ 0DLOYDJDQDP6FKLH‰O %UHLW3UXFNQHU *M¡UY&DV &XVVRQ 0DLOYDJDQDP6FKLH‰O %UHLW3UXFNQHU *M¡UY&DV
WURHWDO/L <XDQ@ WURHWDO/L <XDQ@
3DWFKUHSDLULQFOXGHVWKHUHPRYDO RI ORRVH FRQFUHWH WKDW KDV FUDFNHGVSDOOHGRUGH 3DWFKUHSDLULQFOXGHVWKHUHPRYDO RI ORRVH FRQFUHWH WKDW KDV FUDFNHGVSDOOHGRUGH
ODPLQDWHGRIWHQWKHDSSOLFDWLRQRIVXUIDFHWUHDWPHQWRQWKHVWHHODQGUHSODFHPHQWRI ODPLQDWHGRIWHQWKHDSSOLFDWLRQRIVXUIDFHWUHDWPHQWRQWKHVWHHODQGUHSODFHPHQWRI
WKHGHIHFWLYHFRQFUHWHZLWKDQDSSURSULDWHSDWFKLQJPDWHULDO0DQ\SDWFKUHSDLUVKDYH WKHGHIHFWLYHFRQFUHWHZLWKDQDSSURSULDWHSDWFKLQJPDWHULDO0DQ\SDWFKUHSDLUVKDYH
EHHQIRXQGWRODVWRQO\IURPDIHZPRQWKVWRD\HDUEHIRUHDSSHDUDQFHRIQHZFRUUR EHHQIRXQGWRODVWRQO\IURPDIHZPRQWKVWRD\HDUEHIRUHDSSHDUDQFHRIQHZFRUUR
VLRQGDPDJH&RUURVLRQGDPDJHDIWHUUHSDLURIWHQWDNHVSODFHDWWKHLQWHUIDFHEHWZHHQ VLRQGDPDJH&RUURVLRQGDPDJHDIWHUUHSDLURIWHQWDNHVSODFHDWWKHLQWHUIDFHEHWZHHQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

WKHSDWFKDQGWKHXQUHSDLUHGFRQFUHWHVXEVWUDWH7KLVW\SHRIGDPDJHLVGXHWRWKHVR WKHSDWFKDQGWKHXQUHSDLUHGFRQFUHWHVXEVWUDWH7KLVW\SHRIGDPDJHLVGXHWRWKHVR
FDOOHG ULQJDQRGH HIIHFW LQ WKH OLWHUDWXUH DOVR UHIHUUHG WR DV LQFLSLHQW DQRGH HIIHFW  FDOOHG ULQJDQRGH HIIHFW LQ WKH OLWHUDWXUH DOVR UHIHUUHG WR DV LQFLSLHQW DQRGH HIIHFW 
%HIRUHWKHUHSDLUWKHFRUURGLQJUHLQIRUFHPHQWDFWVDVDQDQRGHZLWKUHVSHFWWRWKHVXU %HIRUHWKHUHSDLUWKHFRUURGLQJUHLQIRUFHPHQWDFWVDVDQDQRGHZLWKUHVSHFWWRWKHVXU
URXQGLQJDUHDVWKDWDUHSRODULVHGFDWKRGLFDOO\ DQGKHQFHSURWHFWHGE\WKHPDFURFHOO URXQGLQJDUHDVWKDWDUHSRODULVHGFDWKRGLFDOO\ DQGKHQFHSURWHFWHGE\WKHPDFURFHOO
$IWHUWKHUHSDLUWKHQHZO\SDWFKHGDUHDLVDWDKLJKHUSRWHQWLDOWKDQWKHVXUURXQGLQJ $IWHUWKHUHSDLUWKHQHZO\SDWFKHGDUHDLVDWDKLJKHUSRWHQWLDOWKDQWKHVXUURXQGLQJ
DUHDV DQG WKH UHVXOWLQJ LPEDODQFH FDQ EH DV KLJK DV  P9 >3UXFNQHU  *M¡UY DUHDV DQG WKH UHVXOWLQJ LPEDODQFH FDQ EH DV KLJK DV  P9 >3UXFNQHU  *M¡UY
@+HQFHIRUPHUO\DQRGLFVLWHVQRORQJHUSURYLGHSURWHFWLRQEXWDFWDVFDWKRGHV @+HQFHIRUPHUO\DQRGLFVLWHVQRORQJHUSURYLGHSURWHFWLRQEXWDFWDVFDWKRGHV
IRUFRUURVLRQLQLWLDWLRQLQWKHDUHDVVXUURXQGLQJWKHSDWFKSULPDULO\WKHLQWHUIDFHV,Q IRUFRUURVLRQLQLWLDWLRQLQWKHDUHDVVXUURXQGLQJWKHSDWFKSULPDULO\WKHLQWHUIDFHV,Q
WKHOLWHUDWXUHWKHUHVXOWLQJFRUURVLRQPHFKDQLVPLVRIWHQGHVFULEHGDVPDFURFHOOFRU WKHOLWHUDWXUHWKHUHVXOWLQJFRUURVLRQPHFKDQLVPLVRIWHQGHVFULEHGDVPDFURFHOOFRU
URVLRQ +RZHYHU FRQWUDU\ WR WKH SUHYDLOLQJ RSLQLRQ WKDW PDFURFHOO FRUURVLRQ LV WKH URVLRQ +RZHYHU FRQWUDU\ WR WKH SUHYDLOLQJ RSLQLRQ WKDW PDFURFHOO FRUURVLRQ LV WKH
RQO\GHWHULRUDWLRQPHFKDQLVPLQSDWFKUHSDLUERWKPDFURFHOODQGPLFURFHOOFRUURVLRQ RQO\GHWHULRUDWLRQPHFKDQLVPLQSDWFKUHSDLUERWKPDFURFHOODQGPLFURFHOOFRUURVLRQ
FDQSOD\DVLJQLILFDQWUROHLQLQGXFLQJFRUURVLRQGDPDJHWRWKHDUHDVXUURXQGLQJWKH FDQSOD\DVLJQLILFDQWUROHLQLQGXFLQJFRUURVLRQGDPDJHWRWKHDUHDVXUURXQGLQJWKH
SDWFK>=KDQJ 0DLOYDJDQDP@ SDWFK>=KDQJ 0DLOYDJDQDP@
7RSUHYHQW WKH ULQJDQRGH HIIHFW WZR WHFKQLTXHV ZKLFK DUHERWKEDVHG RQSRODULVD 7RSUHYHQW WKH ULQJDQRGH HIIHFW WZR WHFKQLTXHV ZKLFK DUHERWKEDVHG RQSRODULVD
WLRQDUHFRPPRQO\DSSOLHGLQPRGHUQSDWFKUHSDLU7KHILUVWRSWLRQFRQVLVWVRIDSSO\ WLRQDUHFRPPRQO\DSSOLHGLQPRGHUQSDWFKUHSDLU7KHILUVWRSWLRQFRQVLVWVRIDSSO\
LQJ ]LQFULFK SULPHUV WR WKH DSSURSULDWHO\ FOHDQHG UHLQIRUFHPHQW EHIRUH SDWFKLQJ LQJ ]LQFULFK SULPHUV WR WKH DSSURSULDWHO\ FOHDQHG UHLQIRUFHPHQW EHIRUH SDWFKLQJ
ZKLOHWKHVHFRQGRQHLVEDVHGRQHPEHGGLQJVDFULILFLDODQRGHVLQWKHSDWFK$QH[DP ZKLOHWKHVHFRQGRQHLVEDVHGRQHPEHGGLQJVDFULILFLDODQRGHVLQWKHSDWFK$QH[DP
SOH IRU D FRPPHUFLDOO\ DYDLODEOH VDFULILFLDO DQRGH V\VWHP IRU SDWFK UHSDLU ZKLFK LV SOH IRU D FRPPHUFLDOO\ DYDLODEOH VDFULILFLDO DQRGH V\VWHP IRU SDWFK UHSDLU ZKLFK LV
FRPPHUFLDOO\NQRZQDV*DOYDVKLHOG;3DQGPDUNHWHGE\)RVURF LVVKRZQLQ)LJXUH FRPPHUFLDOO\NQRZQDV*DOYDVKLHOG;3DQGPDUNHWHGE\)RVURF LVVKRZQLQ)LJXUH
 

 
)LJXUH &RPPHUFLDOO\ DYDLODEOH VDFULILFLDO DQRGH V\VWHP IRU SDWFK UHSDLU )LJXUH &RPPHUFLDOO\ DYDLODEOH VDFULILFLDO DQRGH V\VWHP IRU SDWFK UHSDLU
)URP >4LX @ >$@ 6NHWFK RI DQRGH V\VWHP SUHVHQWLQJ WKH SUH )URP >4LX @ >$@ 6NHWFK RI DQRGH V\VWHP SUHVHQWLQJ WKH SUH
SDFNDJHG]LQFVDFULILFLDODQRGHZLWKVHOIFRQWDLQHG ZLUH WLHV>%@,Q SDFNDJHG]LQFVDFULILFLDODQRGHZLWKVHOIFRQWDLQHG ZLUH WLHV>%@,Q
VWDOOHGVDFULILFLDODQRGHV\VWHP VWDOOHGVDFULILFLDODQRGHV\VWHP
)LJXUH  >$@ VKRZV D VNHWFK RI WKH DQRGH V\VWHP ZKLFK LV EDVHG RQ D SUH )LJXUH  >$@ VKRZV D VNHWFK RI WKH DQRGH V\VWHP ZKLFK LV EDVHG RQ D SUH
SDFNDJHG]LQFVOLFHZLWKZLUHWLHV)LJXUH>%@SUHVHQWVDQH[DPSOHIRUWKHLQVWDO SDFNDJHG]LQFVOLFHZLWKZLUHWLHV)LJXUH>%@SUHVHQWVDQH[DPSOHIRUWKHLQVWDO
ODWLRQEHIRUHSDWFKLQJ7KHHQFDVHPHQWLVFODLPHGWRPDLQWDLQWKHVXUIDFHUHDFWLYLW\RI ODWLRQEHIRUHSDWFKLQJ7KHHQFDVHPHQWLVFODLPHGWRPDLQWDLQWKHVXUIDFHUHDFWLYLW\RI
]LQFE\D³KLJKO\DONDOLQHFHPHQWLWLRXVPRUWDUZKLFKKDVDSRUHVROXWLRQS+VXIIL ]LQFE\D³KLJKO\DONDOLQHFHPHQWLWLRXVPRUWDUZKLFKKDVDSRUHVROXWLRQS+VXIIL
FLHQWO\KLJKIRUFRUURVLRQRIWKHDQRGHWRRFFXUDQGIRUSDVVLYHOD\HUIRUPDWLRQRQWKH FLHQWO\KLJKIRUFRUURVLRQRIWKHDQRGHWRRFFXUDQGIRUSDVVLYHOD\HUIRUPDWLRQRQWKH
DQRGH WR EH DYRLGHG´ >)RVURF @ /DERUDWRU\ LQYHVWLJDWLRQV DQG ILHOG DSSOLFD DQRGH WR EH DYRLGHG´ >)RVURF @ /DERUDWRU\ LQYHVWLJDWLRQV DQG ILHOG DSSOLFD
WLRQVKDYHVKRZQWKDWWKLV]LQFDQRGHV\VWHPFDQVXSSUHVVWKHIRUPDWLRQRILQFLSLHQW WLRQVKDYHVKRZQWKDWWKLV]LQFDQRGHV\VWHPFDQVXSSUHVVWKHIRUPDWLRQRILQFLSLHQW
 

)RVURF$65¡GGLQJ'HQPDUN )RVURF$65¡GGLQJ'HQPDUN

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV

DQRGHV DURXQG D SDWFK UHSDLU )LHOG DSSOLFDWLRQV KDYH LQFOXGHG FDU SDUNV EXLOGLQJV DQRGHV DURXQG D SDWFK UHSDLU )LHOG DSSOLFDWLRQV KDYH LQFOXGHG FDU SDUNV EXLOGLQJV
EULGJHV DQG RWKHU UHLQIRUFHG FRQFUHWH VWUXFWXUHV ZKHUH FRQYHQWLRQDO SDWFK UHSDLUV EULGJHV DQG RWKHU UHLQIRUFHG FRQFUHWH VWUXFWXUHV ZKHUH FRQYHQWLRQDO SDWFK UHSDLUV
FRXOGQRWSURYLGHDFFHSWDEOHSHUIRUPDQFH>4LX@ FRXOGQRWSURYLGHDFFHSWDEOHSHUIRUPDQFH>4LX@
6RWKHDQRGHV\VWHPVHHPVWREHZRUNLQJHIIHFWLYHO\EXWZHFRQVLGHUH[SHULHQFHWR 6RWKHDQRGHV\VWHPVHHPVWREHZRUNLQJHIIHFWLYHO\EXWZHFRQVLGHUH[SHULHQFHWR
EHOLPLWHGVLQFHWKHV\VWHPKDVEHHQWRRXUNQRZOHGJHRQWKHPDUNHWRQO\IRUDERXW EHOLPLWHGVLQFHWKHV\VWHPKDVEHHQWRRXUNQRZOHGJHRQWKHPDUNHWRQO\IRUDERXW
\HDUV,QDGGLWLRQWRWKDWWKHOLIHWLPHLVOLPLWHGWR\HDUV>)RVURF@ \HDUV,QDGGLWLRQWRWKDWWKHOLIHWLPHLVOLPLWHGWR\HDUV>)RVURF@
7KHSURSRVHGQHZFRXQWHUPHDVXUHVUHODWHWRERWKWHFKQLTXHVRISUHYHQWLQJWKHULQJ 7KHSURSRVHGQHZFRXQWHUPHDVXUHVUHODWHWRERWKWHFKQLTXHVRISUHYHQWLQJWKHULQJ
DQRGHHIIHFWDQGSULQFLSOHVIRUDOWHUQDWLYHHOHFWURFKHPLFDODFWLYHFRDWLQJVDQGDQRGH DQRGHHIIHFWDQGSULQFLSOHVIRUDOWHUQDWLYHHOHFWURFKHPLFDODFWLYHFRDWLQJVDQGDQRGH
V\VWHPVZLOOEHGLVFXVVHGLQ&KDSWHU V\VWHPVZLOOEHGLVFXVVHGLQ&KDSWHU

 7KHUPRG\QDPLFVRI&RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV  7KHUPRG\QDPLFVRI&RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV


,QUHODWLRQWRWKHWUDGLWLRQDOIXQGDPHQWDOFRUURVLRQPHFKDQLVP FI)LJXUHLQ6HF ,QUHODWLRQWRWKHWUDGLWLRQDOIXQGDPHQWDOFRUURVLRQPHFKDQLVP FI)LJXUHLQ6HF
WLRQ   WKH IROORZLQJ EDVLF SULQFLSOH IRU UHSDLU RI FRUURVLRQ LQGXFHG GDPDJH LV WLRQ   WKH IROORZLQJ EDVLF SULQFLSOH IRU UHSDLU RI FRUURVLRQ LQGXFHG GDPDJH LV
RIWHQVWDWHGLQWKHOLWHUDWXUHRQUHLQIRUFHPHQWFRUURVLRQ5HSDLURIUHLQIRUFHPHQWFRU RIWHQVWDWHGLQWKHOLWHUDWXUHRQUHLQIRUFHPHQWFRUURVLRQ5HSDLURIUHLQIRUFHPHQWFRU
URVLRQ PXVW DLP DW DFKLHYLQJ RQH RU PRUH RI WKH IROORZLQJ REMHFWLYHV HJ >6FKLH‰O URVLRQ PXVW DLP DW DFKLHYLQJ RQH RU PRUH RI WKH IROORZLQJ REMHFWLYHV HJ >6FKLH‰O
HWDO@ HWDO@
‡ 6WRSWKHDQRGLFSURFHVV ‡ 6WRSWKHDQRGLFSURFHVV
‡ 6WRSWKHFDWKRGLFSURFHVV ‡ 6WRSWKHFDWKRGLFSURFHVV
‡ 6WRSWKHHOHFWURO\WLFFRQGXFWLRQSURFHVV ‡ 6WRSWKHHOHFWURO\WLFFRQGXFWLRQSURFHVV
+RZHYHUEDVHGRQWKHWKHRU\GHVFULEHGIRUIRUPDWLRQRIDQRGLFSURGXFWV FI6HFWLRQ +RZHYHUEDVHGRQWKHWKHRU\GHVFULEHGIRUIRUPDWLRQRIDQRGLFSURGXFWV FI6HFWLRQ
  WKH LQIOXHQFH RI DQRGLF DQG FDWKRGLF SURFHVVHV RQ µ(FRUU¶ FI 6HFWLRQ     WKH LQIOXHQFH RI DQRGLF DQG FDWKRGLF SURFHVVHV RQ µ(FRUU¶ FI 6HFWLRQ  
DQGWKHQDWXUHRIWKHLRQLFFXUUHQWLQFRQFUHWH FI6HFWLRQ ZHWKLQNWKDWWKLV DQGWKHQDWXUHRIWKHLRQLFFXUUHQWLQFRQFUHWH FI6HFWLRQ ZHWKLQNWKDWWKLV
GHVFULSWLRQ LV QRW IXOO\ FRPSUHKHQVLYH DQG SURSRVH DQ DOWHUQDWLYH DSSURDFK WRZDUGV GHVFULSWLRQ LV QRW IXOO\ FRPSUHKHQVLYH DQG SURSRVH DQ DOWHUQDWLYH DSSURDFK WRZDUGV
UHSDLUDQGUHKDELOLWDWLRQRIFRQFUHWHVWUXFWXUHV UHSDLUDQGUHKDELOLWDWLRQRIFRQFUHWHVWUXFWXUHV
)LJXUH  VKRZV WKH 3RXUEDL[ GLDJUDPV WKDW ZHUH GHULYHG DQG LQWURGXFHG LQ 6HF )LJXUH  VKRZV WKH 3RXUEDL[ GLDJUDPV WKDW ZHUH GHULYHG DQG LQWURGXFHG LQ 6HF
WLRQVDQGDVDEDVLVIRUWKHWKHUPRG\QDPLFGHVFULSWLRQRIFDUERQDWLRQ WLRQVDQGDVDEDVLVIRUWKHWKHUPRG\QDPLFGHVFULSWLRQRIFDUERQDWLRQ
DQG FKORULGH LQGXFHG FRUURVLRQ UHVSHFWLYHO\ /HDYLQJ RXW WKH WKHRU\ GLVFXVVHG IRU DQG FKORULGH LQGXFHG FRUURVLRQ UHVSHFWLYHO\ /HDYLQJ RXW WKH WKHRU\ GLVFXVVHG IRU
FRUURVLRQLQLWLDWLRQRIFDUERQDWLRQDQGFKORULGHLQGXFHGUHLQIRUFHPHQWFRUURVLRQLH FRUURVLRQLQLWLDWLRQRIFDUERQDWLRQDQGFKORULGHLQGXFHGUHLQIRUFHPHQWFRUURVLRQLH
WKH S+ GURS IURP FDVH $  WR FDVH %  LQ )LJXUH  >$@ DQG WKH SLWWLQJ SRWHQWLDO WKH S+ GURS IURP FDVH $  WR FDVH %  LQ )LJXUH  >$@ DQG WKH SLWWLQJ SRWHQWLDO
FXUYHVLQ)LJXUH>%@LWFDQEHFRQFOXGHGWKDWDFULWLFDOµ(FRUU¶DQGS+IRUFRUUR FXUYHVLQ)LJXUH>%@LWFDQEHFRQFOXGHGWKDWDFULWLFDOµ(FRUU¶DQGS+IRUFRUUR
VLRQSURSDJDWLRQXQGHUERWKFRQGLWLRQVLVLQWKHDUHDRIP9DQGS+ VLRQSURSDJDWLRQXQGHUERWKFRQGLWLRQVLVLQWKHDUHDRIP9DQGS+

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


&RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV

 
í í
)LJXUH >$@ )H+2 µ6(3'¶ EDVHG RQ 7DEOH  DQG )HLD   PRO/ ZLWK )LJXUH >$@ )H+2 µ6(3'¶ EDVHG RQ 7DEOH  DQG )HLD   PRO/ ZLWK
SURSRVHGPHFKDQLVPIRUFDUERQDWLRQLQGXFHGFRUURVLRQLQR[\JHQULFK SURSRVHGPHFKDQLVPIRUFDUERQDWLRQLQGXFHGFRUURVLRQLQR[\JHQULFK
FRQFUHWH FI )LJXUH  LQ 6HFWLRQ   >%@ )H&O+2 µ0(3'¶ FRQFUHWH FI )LJXUH  LQ 6HFWLRQ   >%@ )H&O+2 µ0(3'¶
EDVHGRQ7DEOHDQG)HLD íPRO/DQG&OLD PRO/ZLWKSUR EDVHGRQ7DEOHDQG)HLD íPRO/DQG&OLD PRO/ZLWKSUR
SRVHG PHFKDQLVP IRU FKORULGH LQGXFHG FRUURVLRQ LQ R[\JHQGHSULYHG SRVHG PHFKDQLVP IRU FKORULGH LQGXFHG FRUURVLRQ LQ R[\JHQGHSULYHG
FRQFUHWH FI)LJXUHLQ6HFWLRQ  FRQFUHWH FI)LJXUHLQ6HFWLRQ 
7KLVFULWLFDOµ(FRUU¶DQGS+DUHDDUHLQGLFDWHGE\FDVH $ LQWKHµ6,3'¶RIWKH)H+2 7KLVFULWLFDOµ(FRUU¶DQGS+DUHDDUHLQGLFDWHGE\FDVH $ LQWKHµ6,3'¶RIWKH)H+2
µ6(3'¶RQWKH)H&O+2µ0(3'¶LQ)LJXUH µ6(3'¶RQWKH)H&O+2µ0(3'¶LQ)LJXUH

 
)LJXUH µ6,3'¶RI)H+2µ6(3'¶RQ)H&O+2µ0(3'¶ZLWKLGHQWLILFDWLRQ )LJXUH µ6,3'¶RI)H+2µ6(3'¶RQ)H&O+2µ0(3'¶ZLWKLGHQWLILFDWLRQ
RI FULWLFDO µ(FRUU¶ DQG S+ DUHD $ EOXH GRW  DV LGHQWLILHG LQ )LJXUH RI FULWLFDO µ(FRUU¶ DQG S+ DUHD $ EOXH GRW  DV LGHQWLILHG LQ )LJXUH
 DQG LOOXVWUDWLRQ RI SRWHQWLDO WKHUPRG\QDPLF DSSURDFKHV IRU UH  DQG LOOXVWUDWLRQ RI SRWHQWLDO WKHUPRG\QDPLF DSSURDFKHV IRU UH
SDLU %&'DQG(\HOORZGRWV  SDLU %&'DQG(\HOORZGRWV 
7KHUPRG\QDPLF DSSURDFKHV WR PRYH WKH V\VWHP DZD\ IURP WKH FULWLFDO FRQGLWLRQ 7KHUPRG\QDPLF DSSURDFKHV WR PRYH WKH V\VWHP DZD\ IURP WKH FULWLFDO FRQGLWLRQ
JLYHQE\FDVH $ DUHLOOXVWUDWHGE\FDVHV % WR ( LQ)LJXUH JLYHQE\FDVH $ DUHLOOXVWUDWHGE\FDVHV % WR ( LQ)LJXUH
‡ &DVH %  LOOXVWUDWHV WKH DSSURDFK RI ORZHULQJ µ(FRUU¶ LQWR WKH LPPXQH DUHD ZKLOH ‡ &DVH %  LOOXVWUDWHV WKH DSSURDFK RI ORZHULQJ µ(FRUU¶ LQWR WKH LPPXQH DUHD ZKLOH
PDLQWDLQLQJWKHS+ ,QWHUPVRIFRXQWHUPHDVXUHVIRUH[LVWLQJVWUXFWXUHVWKLVFDQ PDLQWDLQLQJWKHS+ ,QWHUPVRIFRXQWHUPHDVXUHVIRUH[LVWLQJVWUXFWXUHVWKLVFDQ
EHXQGHUVWRRGDVWKHDLPRIµ&3¶ ZKLOHµ&3¶LQSUDFWLFHDOVRLQYROYHVUHDONDOLVD EHXQGHUVWRRGDVWKHDLPRIµ&3¶ ZKLOHµ&3¶LQSUDFWLFHDOVRLQYROYHVUHDONDOLVD
WLRQFI6HFWLRQ  WLRQFI6HFWLRQ 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV $YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV &RXQWHUPHDVXUHVIRU([LVWLQJ6WUXFWXUHV

‡ &DVH & LQGLFDWHVWKHRSSRVLWHDSSURDFKWRFDVH % LHµ(FRUU¶LVPRYHGXSLQWR ‡ &DVH & LQGLFDWHVWKHRSSRVLWHDSSURDFKWRFDVH % LHµ(FRUU¶LVPRYHGXSLQWR


WKHSDVVLYHGRPDLQDWDFRQVWDQWS+ZKLFKFRUUHVSRQGVWRDQRGLFSURWHFWLRQDLP WKHSDVVLYHGRPDLQDWDFRQVWDQWS+ZKLFKFRUUHVSRQGVWRDQRGLFSURWHFWLRQDLP
LQJDWWKHSURWHFWLYHQHVVRIWKHSDVVLYHOD\HU$QRGLFSRODULVDWLRQFDQQDWXUDOO\EH LQJDWWKHSURWHFWLYHQHVVRIWKHSDVVLYHOD\HU$QRGLFSRODULVDWLRQFDQQDWXUDOO\EH
DFKLHYHG E\ HJ DQ DQRGLF FXUUHQW ZKLFK WR RXU NQRZOHGJH LV QRW DSSOLHG LQ DFKLHYHG E\ HJ DQ DQRGLF FXUUHQW ZKLFK WR RXU NQRZOHGJH LV QRW DSSOLHG LQ
SUDFWLFH EXWLQWHUPVRIWKHGLVFXVVHGFRXQWHUPHDVXUHVIRUH[LVWLQJVWUXFWXUHVLW SUDFWLFH EXWLQWHUPVRIWKHGLVFXVVHGFRXQWHUPHDVXUHVIRUH[LVWLQJVWUXFWXUHVLW
SULPDULO\ UHODWHV WR DQRGLF GLIIXVLRQ LQKLELWRUV 7KH SUR[LPLW\ RI FDVH &  WR WKH SULPDULO\ UHODWHV WR DQRGLF GLIIXVLRQ LQKLELWRUV 7KH SUR[LPLW\ RI FDVH &  WR WKH
FULWLFDOVWDELOLW\GRPDLQRIIHUULFFKORULGH FI6HFWLRQ LQFRPELQDWLRQZLWK FULWLFDOVWDELOLW\GRPDLQRIIHUULFFKORULGH FI6HFWLRQ LQFRPELQDWLRQZLWK
WKHLQFUHDVHLQ³FRUURVLRQSRZHU´GXHWRDQRGLFSRODULVDWLRQ FI6HFWLRQ  WKHLQFUHDVHLQ³FRUURVLRQSRZHU´GXHWRDQRGLFSRODULVDWLRQ FI6HFWLRQ 
XQGHUOLQHV RXU UHMHFWLRQ RI DQRGLF SURWHFWLRQ LQ WKH FKORULGH HQYLURQPHQW 7KLV XQGHUOLQHV RXU UHMHFWLRQ RI DQRGLF SURWHFWLRQ LQ WKH FKORULGH HQYLURQPHQW 7KLV
GRHV QRW RQO\ DSSO\ ZLWK UHJDUG WR DQRGLF LQKLELWRUV LQ JHQHUDO FI 6HFWLRQ GRHV QRW RQO\ DSSO\ ZLWK UHJDUG WR DQRGLF LQKLELWRUV LQ JHQHUDO FI 6HFWLRQ
 EXWDOVRZLWKUHJDUGWRHJQREOHFODGV FI6HFWLRQ   EXWDOVRZLWKUHJDUGWRHJQREOHFODGV FI6HFWLRQ 
‡ 6LPLODU WR FDVH &  FDVH '  GHSHQGV RQ WKH SURWHFWLRQ SURYLGHG E\ WKH SDVVLYH ‡ 6LPLODU WR FDVH &  FDVH '  GHSHQGV RQ WKH SURWHFWLRQ SURYLGHG E\ WKH SDVVLYH
OD\HUDQGLOOXVWUDWHVWKHWKHUPRG\QDPLFDSSURDFKRILQFUHDVLQJWKHS+RIWKHFRQ OD\HUDQGLOOXVWUDWHVWKHWKHUPRG\QDPLFDSSURDFKRILQFUHDVLQJWKHS+RIWKHFRQ
FUHWHLHWKHDLPLVUHLQVWDOOLQJWKHLQLWLDOVLWXDWLRQRILQWDFWXQFRQWDPLQDWHGFRQ FUHWHLHWKHDLPLVUHLQVWDOOLQJWKHLQLWLDOVLWXDWLRQRILQWDFWXQFRQWDPLQDWHGFRQ
FUHWH,QWHUPVRIWKHGLVFXVVHGUHSDLUPHWKRGVWKLVDSSURDFKSULPDULO\UHODWHVWR FUHWH,QWHUPVRIWKHGLVFXVVHGUHSDLUPHWKRGVWKLVDSSURDFKSULPDULO\UHODWHVWR
µ(5$¶ZKLOHVLPLODUHIIHFWVDUHREWDLQHGIURPµ(&5¶ FI6HFWLRQ 1HYHU µ(5$¶ZKLOHVLPLODUHIIHFWVDUHREWDLQHGIURPµ(&5¶ FI6HFWLRQ 1HYHU
WKHOHVV WKH SULQFLSDO DLP RI µ(&5¶ FDQ EH XQGHUVWRRG WKHUPRG\QDPLFDOO\ WR UH WKHOHVV WKH SULQFLSDO DLP RI µ(&5¶ FDQ EH XQGHUVWRRG WKHUPRG\QDPLFDOO\ WR UH
PRYH &O IURP WKH )H+2VRWKDWWKHVWDELOLW\GRPDLQRIIHUULFFKORULGH ZLOOEH PRYH &O IURP WKH )H+2VRWKDWWKHVWDELOLW\GRPDLQRIIHUULFFKORULGH ZLOOEH
UHGXFHG FI6HFWLRQ 3DWFKUHSDLUUHODWHVWRERWKWKHVHLVVXHVEXWWKHSRVL UHGXFHG FI6HFWLRQ 3DWFKUHSDLUUHODWHVWRERWKWKHVHLVVXHVEXWWKHSRVL
WLYHHIIHFWLVOLPLWHGWRWKHSDWFKHGDUHDZKHUHDVWKHULQJDQRGHHIIHFWSURPRWHV WLYHHIIHFWLVOLPLWHGWRWKHSDWFKHGDUHDZKHUHDVWKHULQJDQRGHHIIHFWSURPRWHV
FRUURVLRQLQLWVYLFLQLW\7KHULQJDQRGHHIIHFWFDQEHSUHYHQWHGLIWKHSDWFKUHSDLU FRUURVLRQLQLWVYLFLQLW\7KHULQJDQRGHHIIHFWFDQEHSUHYHQWHGLIWKHSDWFKUHSDLU
VWUDWHJ\LVFRPELQHGZLWKDGGLWLRQDOPHDVXUHVHJFRUUHVSRQGLQJWRFDVH %  VWUDWHJ\LVFRPELQHGZLWKDGGLWLRQDOPHDVXUHVHJFRUUHVSRQGLQJWRFDVH % 
‡ )LQDOO\ FDVH (  DOVR DLPV DW WKH SURWHFWLYHQHVV RI WKH SDVVLYH OD\HU EXW LW LV ‡ )LQDOO\ FDVH (  DOVR DLPV DW WKH SURWHFWLYHQHVV RI WKH SDVVLYH OD\HU EXW LW LV
DFKLHYHGE\DFRPELQDWLRQRIDSSURDFKHV & DQG ' LHERWKµ(FRUU¶DQGWKHS+ DFKLHYHGE\DFRPELQDWLRQRIDSSURDFKHV & DQG ' LHERWKµ(FRUU¶DQGWKHS+
DUH LQFUHDVHG WR SURYLGH DQ HQYLURQPHQW IRU WKH IRUPDWLRQ RI D VWDEOH SDVVLYH DUH LQFUHDVHG WR SURYLGH DQ HQYLURQPHQW IRU WKH IRUPDWLRQ RI D VWDEOH SDVVLYH
OD\HU+RZHYHUWKLVFRQFHSWFDQQRWEHUHDOLVHGLQSUDFWLFHDQGWRRXUNQRZOHGJH OD\HU+RZHYHUWKLVFRQFHSWFDQQRWEHUHDOLVHGLQSUDFWLFHDQGWRRXUNQRZOHGJH
QRUHSDLUVWUDWHJ\H[LVWVWKDWDLPVDWWKLVDSSURDFK%DVHGRQWKHWKHRU\FRQFHUQ QRUHSDLUVWUDWHJ\H[LVWVWKDWDLPVDWWKLVDSSURDFK%DVHGRQWKHWKHRU\FRQFHUQ
LQJWKHFRPSRVLWLRQRIWKHSRUHVROXWLRQ FI6HFWLRQ DQGPLJUDWLRQ FI6HF LQJWKHFRPSRVLWLRQRIWKHSRUHVROXWLRQ FI6HFWLRQ DQGPLJUDWLRQ FI6HF
WLRQ LWFDQEHWKHUPRG\QDPLFDOO\UHDVRQHGWKDWHJLPSUHVVHGFXUUHQWDQ WLRQ LWFDQEHWKHUPRG\QDPLFDOO\UHDVRQHGWKDWHJLPSUHVVHGFXUUHQWDQ
RGLFSRODULVDWLRQLQHYLWDEOHOHDGVWRDQDFLGLILFDWLRQDWWKHDQRGHLHLQWKHYLFLQ RGLFSRODULVDWLRQLQHYLWDEOHOHDGVWRDQDFLGLILFDWLRQDWWKHDQRGHLHLQWKHYLFLQ
LW\RIWKHUHLQIRUFHPHQWVWHHO FI6HFWLRQ  LW\RIWKHUHLQIRUFHPHQWVWHHO FI6HFWLRQ 
 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 

 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV  'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV
$VLQGLFDWHGLQ6HFWLRQWKHGHVLJQSKDVHVRIFRQFHUQLQWKLVWKHVLVFRUUHVSRQGWR $VLQGLFDWHGLQ6HFWLRQWKHGHVLJQSKDVHVRIFRQFHUQLQWKLVWKHVLVFRUUHVSRQGWR
WKHILUVWWKUHHSKDVHVLQWKHSURSRVHGVLPSOLILHGIORZFKDUWIRUWKHGHVLJQDQGLPSOH WKHILUVWWKUHHSKDVHVLQWKHSURSRVHGVLPSOLILHGIORZFKDUWIRUWKHGHVLJQDQGLPSOH
PHQWDWLRQRIQHZFRXQWHUPHDVXUHVVHH)LJXUH PHQWDWLRQRIQHZFRXQWHUPHDVXUHVVHH)LJXUH

 
)LJXUH ([WUDFW IURP WKH SURSRVHG IORZ FKDUW IRU GHVLJQ RI QHZ FRXQWHUPHD )LJXUH ([WUDFW IURP WKH SURSRVHG IORZ FKDUW IRU GHVLJQ RI QHZ FRXQWHUPHD
VXUHV FI)LJXUH6HFWLRQ LQGLFDWLQJWKHGHVLJQSKDVHVRIFRQ VXUHV FI)LJXUH6HFWLRQ LQGLFDWLQJWKHGHVLJQSKDVHVRIFRQ
FHUQLQWKHSUHVHQWWKHVLV FHUQLQWKHSUHVHQWWKHVLV
)LJXUHLOOXVWUDWHVWKDWSKDVHUHODWHVWRWKHKLJKO\LQWHUFRQQHFWHGWKHUPRG\QDPLF )LJXUHLOOXVWUDWHVWKDWSKDVHUHODWHVWRWKHKLJKO\LQWHUFRQQHFWHGWKHUPRG\QDPLF
FRQVLGHUDWLRQVSURGXFWLRQDQGLPSOHPHQWDWLRQSURFHVVHVDQGNLQHWLFFRQVLGHUDWLRQV FRQVLGHUDWLRQVSURGXFWLRQDQGLPSOHPHQWDWLRQSURFHVVHVDQGNLQHWLFFRQVLGHUDWLRQV
7KLVSKDVHZKLFKLVPRVWLPSRUWDQWLQWKHSUHVHQWWKHVLVLVSUHFHGHGDQGODUJHO\JRY 7KLVSKDVHZKLFKLVPRVWLPSRUWDQWLQWKHSUHVHQWWKHVLVLVSUHFHGHGDQGODUJHO\JRY
HUQHG E\ JHQHUDO FRQVLGHUDWLRQV LQ SKDVH DQG VXFFHHGHG E\ SUHOLPLQDU\ WHVWLQJ LQ HUQHG E\ JHQHUDO FRQVLGHUDWLRQV LQ SKDVH DQG VXFFHHGHG E\ SUHOLPLQDU\ WHVWLQJ LQ
SKDVH7KHJHQHUDOFRQVLGHUDWLRQVDUHOLQNHGWRWKHVWUXFWXUDODQGPDWHULDOVSURSHU SKDVH7KHJHQHUDOFRQVLGHUDWLRQVDUHOLQNHGWRWKHVWUXFWXUDODQGPDWHULDOVSURSHU
WLHVRIUHLQIRUFHGFRQFUHWH FI&KDSWHU 7KHWKHUPRG\QDPLFDQGNLQHWLFFRQVLGHUD WLHVRIUHLQIRUFHGFRQFUHWH FI&KDSWHU 7KHWKHUPRG\QDPLFDQGNLQHWLFFRQVLGHUD
WLRQV DV ZHOO DV WKH SURGXFWLRQ DQG LPSOHPHQWDWLRQ DQG WKH SUHOLPLQDU\ WHVWLQJ DUH WLRQV DV ZHOO DV WKH SURGXFWLRQ DQG LPSOHPHQWDWLRQ DQG WKH SUHOLPLQDU\ WHVWLQJ DUH
ODUJHO\ EDVHG RQ DSSOLFDWLRQ RI WKH DYDLODEOH DTXHRXV PHWDOOLF FRUURVLRQ WKHRU\ FI ODUJHO\ EDVHG RQ DSSOLFDWLRQ RI WKH DYDLODEOH DTXHRXV PHWDOOLF FRUURVLRQ WKHRU\ FI
&KDSWHU DQGLWVDGDSWDWLRQWRUHLQIRUFHPHQWFRUURVLRQ FI&KDSWHU 7KHDGDSWD &KDSWHU DQGLWVDGDSWDWLRQWRUHLQIRUFHPHQWFRUURVLRQ FI&KDSWHU 7KHDGDSWD
WLRQRIWKHWKHRU\ZDVGHWDLOHGIRUFRUURVLRQRIFDUERQVWHHOLQFRQFUHWHLQ&KDSWHU WLRQRIWKHWKHRU\ZDVGHWDLOHGIRUFRUURVLRQRIFDUERQVWHHOLQFRQFUHWHLQ&KDSWHU
DQG LQGLFDWHG IRU DYDLODEOH FRXQWHUPHDVXUHV WKURXJKRXW &KDSWHU (YHQ WKRXJK WKLV DQG LQGLFDWHG IRU DYDLODEOH FRXQWHUPHDVXUHV WKURXJKRXW &KDSWHU (YHQ WKRXJK WKLV
&KDSWHUFRYHUVWKHFHQWUDOREMHFWLYHVRIWKLVWKHVLVLWLVNHSWUHODWLYHO\VKRUWVLQFHLWLV &KDSWHUFRYHUVWKHFHQWUDOREMHFWLYHVRIWKLVWKHVLVLWLVNHSWUHODWLYHO\VKRUWVLQFHLWLV
PDLQO\EDVHGRQWKHHVVHQFHRI&KDSWHUVWRZKLFKLVH[WHQGHGWRDQGDSSOLHGLQ PDLQO\EDVHGRQWKHHVVHQFHRI&KDSWHUVWRZKLFKLVH[WHQGHGWRDQGDSSOLHGLQ
WKHFRQFHSWXDOGHVLJQRIQHZFRXQWHUPHDVXUHV WKHFRQFHSWXDOGHVLJQRIQHZFRXQWHUPHDVXUHV
,Q 6HFWLRQ  WKH PRVWLPSRUWDQW GHVLJQ DVSHFWV DQG UHTXLUHPHQWV ZH WRRN LQWR DF ,Q 6HFWLRQ  WKH PRVWLPSRUWDQW GHVLJQ DVSHFWV DQG UHTXLUHPHQWV ZH WRRN LQWR DF
FRXQWLQWKHGHYHORSPHQWRIWKHQHZ FRXQWHUPHDVXUHVDUHOLVWHG2XUWKHRUHWLFDOGH FRXQWLQWKHGHYHORSPHQWRIWKHQHZ FRXQWHUPHDVXUHVDUHOLVWHG2XUWKHRUHWLFDOGH
VLJQDSSURDFKLVGHDOWZLWKLQ6HFWLRQZKLOHWKHSULQFLSDOPDWHULDOVFRQFHSWVDUH VLJQDSSURDFKLVGHDOWZLWKLQ6HFWLRQZKLOHWKHSULQFLSDOPDWHULDOVFRQFHSWVDUH
GLVFXVVHG LQ 6HFWLRQ  6RPH UHPDUNV RQ WKH LPSOHPHQWDWLRQ RI WKH PDWHULDO FRQ GLVFXVVHG LQ 6HFWLRQ  6RPH UHPDUNV RQ WKH LPSOHPHQWDWLRQ RI WKH PDWHULDO FRQ
FHSWVDQGWKHLUDSSOLFDWLRQRQDVWUXFWXUDOVFDOHDUHJLYHQLQ6HFWLRQ:LWKUHJDUG FHSWVDQGWKHLUDSSOLFDWLRQRQDVWUXFWXUDOVFDOHDUHJLYHQLQ6HFWLRQ:LWKUHJDUG
WRWKHH[SHFWHGSDWHQWSRVVLELOLWLHV FI6HFWLRQ ERWKWKHWKHRUHWLFDODSSURDFKDQG WRWKHH[SHFWHGSDWHQWSRVVLELOLWLHV FI6HFWLRQ ERWKWKHWKHRUHWLFDODSSURDFKDQG
LWVSUDFWLFDOUHDOLVDWLRQDUHGHVFULEHGZLWKRXWJRLQJLQWRGHWDLODQGWKXVFHQWUDODVSHFWV LWVSUDFWLFDOUHDOLVDWLRQDUHGHVFULEHGZLWKRXWJRLQJLQWRGHWDLODQGWKXVFHQWUDODVSHFWV
DUHH[FOXGHGIURPWKHDVVRFLDWHG6HFWLRQV7KHILQDO6HFWLRQVXPPDULVHVDVSHFWV DUHH[FOXGHGIURPWKHDVVRFLDWHG6HFWLRQV7KHILQDO6HFWLRQVXPPDULVHVDVSHFWV
RI DQG UHTXLUHPHQWV IRU SUHOLPLQDU\ WHVWLQJ RI FRXQWHUPHDVXUHV ZLWK IRFXV RQ SHU RI DQG UHTXLUHPHQWV IRU SUHOLPLQDU\ WHVWLQJ RI FRXQWHUPHDVXUHV ZLWK IRFXV RQ SHU
IRUPDQFHHYDOXDWLRQEDVHGRQHOHFWURFKHPLFDOWHVWLQJ IRUPDQFHHYDOXDWLRQEDVHGRQHOHFWURFKHPLFDOWHVWLQJ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 'HVLJQ$VSHFWVDQG5HTXLUHPHQWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 'HVLJQ$VSHFWVDQG5HTXLUHPHQWV

,WVKRXOGEHQRWHGWKDWWKHGHVFULEHGVWUDWHJLHVDLPDWERWKFDUERQDWLRQDQGFKORULGH ,WVKRXOGEHQRWHGWKDWWKHGHVFULEHGVWUDWHJLHVDLPDWERWKFDUERQDWLRQDQGFKORULGH
LQGXFHGFRUURVLRQ FI6HFWLRQVDQG +RZHYHUDVUHDVRQHGWKURXJKRXW LQGXFHGFRUURVLRQ FI6HFWLRQVDQG +RZHYHUDVUHDVRQHGWKURXJKRXW
&KDSWHUDQG6HFWLRQFKORULGHLQGXFHGFRUURVLRQLVWKHPDLQFRQFHUQ+HQFHWKH &KDSWHUDQG6HFWLRQFKORULGHLQGXFHGFRUURVLRQLVWKHPDLQFRQFHUQ+HQFHWKH
PRGHOVXVHGIRUWKHGHVFULSWLRQVRIRXUDSSURDFKHVDUHODUJHO\EDVHGRQFKORULGHLQ PRGHOVXVHGIRUWKHGHVFULSWLRQVRIRXUDSSURDFKHVDUHODUJHO\EDVHGRQFKORULGHLQ
GXFHGFRUURVLRQLHRQWKH)H&O+2V\VWHP GXFHGFRUURVLRQLHRQWKH)H&O+2V\VWHP

 'HVLJQ$VSHFWVDQG5HTXLUHPHQWV  'HVLJQ$VSHFWVDQG5HTXLUHPHQWV


,QWKLV6HFWLRQWKHPRVWLPSRUWDQWGHVLJQDVSHFWVDQGUHTXLUHPHQWVWKDWZHWRRNLQWR ,QWKLV6HFWLRQWKHPRVWLPSRUWDQWGHVLJQDVSHFWVDQGUHTXLUHPHQWVWKDWZHWRRNLQWR
DFFRXQWDUHVXPPDULVHGLHLWGHDOVZLWKSKDVHVDQGRIRXUSURSRVHGGHVLJQDS DFFRXQWDUHVXPPDULVHGLHLWGHDOVZLWKSKDVHVDQGRIRXUSURSRVHGGHVLJQDS
SURDFKLOOXVWUDWHGLQ)LJXUH6LQFHWKHFRQVLGHUDWLRQVLQWKHVHSKDVHV SDUWLFXODUO\ SURDFKLOOXVWUDWHGLQ)LJXUH6LQFHWKHFRQVLGHUDWLRQVLQWKHVHSKDVHV SDUWLFXODUO\
LQSKDVH DUHODUJHO\LQWHUFRQQHFWHGQRFOHDUGLVWLQFWLRQLVPDGHEHWZHHQWKHFRQ LQSKDVH DUHODUJHO\LQWHUFRQQHFWHGQRFOHDUGLVWLQFWLRQLVPDGHEHWZHHQWKHFRQ
VLGHUDWLRQV,QVWHDGWKHVXEGLYLVLRQLVDVIROORZV VLGHUDWLRQV,QVWHDGWKHVXEGLYLVLRQLVDVIROORZV
‡ $VSHFWVDQGUHTXLUHPHQWVUHODWLQJWRFRUURVLRQUHVLVWDQFH ‡ $VSHFWVDQGUHTXLUHPHQWVUHODWLQJWRFRUURVLRQUHVLVWDQFH
‡ $VSHFWVDQGUHTXLUHPHQWVUHODWLQJWRVWUXFWXUDODQGJHQHUDOGXUDELOLW\SHUIRUPDQFH ‡ $VSHFWVDQGUHTXLUHPHQWVUHODWLQJWRVWUXFWXUDODQGJHQHUDOGXUDELOLW\SHUIRUPDQFH
‡ $VSHFWVDQGUHTXLUHPHQWVUHODWLQJWRFUDFNLQJRIWKHFRQFUHWH ‡ $VSHFWVDQGUHTXLUHPHQWVUHODWLQJWRFUDFNLQJRIWKHFRQFUHWH
‡ 3UDFWLFDODVSHFWVDQGUHTXLUHPHQWV ‡ 3UDFWLFDODVSHFWVDQGUHTXLUHPHQWV
‡ (FRQRPLFDODVSHFWVDQGUHTXLUHPHQWV ‡ (FRQRPLFDODVSHFWVDQGUHTXLUHPHQWV
‡ (FRORJLFDODVSHFWVDQGUHTXLUHPHQWV ‡ (FRORJLFDODVSHFWVDQGUHTXLUHPHQWV
0RVWRIWKHVHDVSHFWVDQGUHTXLUHPHQWVUHODWHWRVKRUWFRPLQJVRIWKHDYDLODEOHFRXQ 0RVWRIWKHVHDVSHFWVDQGUHTXLUHPHQWVUHODWHWRVKRUWFRPLQJVRIWKHDYDLODEOHFRXQ
WHUPHDVXUHVZKLFKKDYHEHHQLQGLFDWHGLQ&KDSWHU7KHVKRUWFRPLQJVDUHOLVWHGLQ WHUPHDVXUHVZKLFKKDYHEHHQLQGLFDWHGLQ&KDSWHU7KHVKRUWFRPLQJVDUHOLVWHGLQ
FRQQHFWLRQ ZLWK WKH DVVRFLDWHG %XOOHWV ZKLFK DUH QXPEHUHG $UDELF QXPHUDO  EH FRQQHFWLRQ ZLWK WKH DVVRFLDWHG %XOOHWV ZKLFK DUH QXPEHUHG $UDELF QXPHUDO  EH
FDXVHWKH\DUHIUHTXHQWO\UHIHUUHGWRWKURXJKRXWWKLV&KDSWHU FDXVHWKH\DUHIUHTXHQWO\UHIHUUHGWRWKURXJKRXWWKLV&KDSWHU
 $VSHFWVDQGUHTXLUHPHQWVUHODWLQJWRFRUURVLRQUHVLVWDQFH  $VSHFWVDQGUHTXLUHPHQWVUHODWLQJWRFRUURVLRQUHVLVWDQFH
$VWKHIXQGDPHQWDOEDVLVRIDOOFRQVLGHUDWLRQVLQSKDVHVDQG FI)LJXUH  $VWKHIXQGDPHQWDOEDVLVRIDOOFRQVLGHUDWLRQVLQSKDVHVDQG FI)LJXUH 
WKHFRXQWHUPHDVXUHVVKRXOGSURYLGHWKHIROORZLQJIRUQHZDQGH[LVWLQJVWUXFWXUHV WKHFRXQWHUPHDVXUHVVKRXOGSURYLGHWKHIROORZLQJIRUQHZDQGH[LVWLQJVWUXFWXUHV
 $VLJQLILFDQWLPSURYHPHQWRIWKHUHVLVWDQFHRIUHLQIRUFHPHQWDJDLQVWERWKFDU  $VLJQLILFDQWLPSURYHPHQWRIWKHUHVLVWDQFHRIUHLQIRUFHPHQWDJDLQVWERWKFDU
ERQDWLRQDQGFKORULGHLQGXFHGFRUURVLRQ ERQDWLRQDQGFKORULGHLQGXFHGFRUURVLRQ
 5HOLDEOH ORQJWHUP LPSURYHPHQW LH DVVXULQJ VHUYLFH OLYHV RI   RU  5HOLDEOH ORQJWHUP LPSURYHPHQW LH DVVXULQJ VHUYLFH OLYHV RI   RU
PRUH\HDUV PRUH\HDUV
 3URWHFWLRQDJDLQVWDOOFULWLFDOIRUPVRIFRUURVLRQ FI6HFWLRQ   3URWHFWLRQDJDLQVWDOOFULWLFDOIRUPVRIFRUURVLRQ FI6HFWLRQ 
 (IIHFWLYHQHVVDWDOOUHOHYDQWH[SRVXUHFRQGLWLRQV LQDGGLWLRQWRFKORULGHFRQ  (IIHFWLYHQHVVDWDOOUHOHYDQWH[SRVXUHFRQGLWLRQV LQDGGLWLRQWRFKORULGHFRQ
WDPLQDWLRQDQGFDUERQDWLRQ LQSDUWLFXODUDOOGHJUHHVRIVDWXUDWLRQ FI6HFWLRQ WDPLQDWLRQDQGFDUERQDWLRQ LQSDUWLFXODUDOOGHJUHHVRIVDWXUDWLRQ FI6HFWLRQ
  DQG QRUPDO DPELHQW WHPSHUDWXUHV FI 6HFWLRQ   ZKLOH VSHFLDO   DQG QRUPDO DPELHQW WHPSHUDWXUHV FI 6HFWLRQ   ZKLOH VSHFLDO
KLJKRUORZWHPSHUDWXUHDSSOLFDWLRQVUHTXLUHDGGLWLRQDOFRQVLGHUDWLRQV KLJKRUORZWHPSHUDWXUHDSSOLFDWLRQVUHTXLUHDGGLWLRQDOFRQVLGHUDWLRQV
'RXEWIXODQGRUQHJDWLYHH[DPSOHVFRQFHUQLQJORQJWHUPHIIHFWLYHQHVVLQFOXGHLQ 'RXEWIXODQGRUQHJDWLYHH[DPSOHVFRQFHUQLQJORQJWHUPHIIHFWLYHQHVVLQFOXGHLQ
SULQFLSOHDOOFRQFUHWHFRXQWHUPHDVXUHV FI6HFWLRQ JDOYDQLVHG FI6HFWLRQ SULQFLSOHDOOFRQFUHWHFRXQWHUPHDVXUHV FI6HFWLRQ JDOYDQLVHG FI6HFWLRQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


'HVLJQ$VSHFWVDQG5HTXLUHPHQWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 'HVLJQ$VSHFWVDQG5HTXLUHPHQWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV

 DVZHOODVHSR[\FRDWHGVWHHO FI6HFWLRQ DQGPRVWUHSDLUWHFK  DVZHOODVHSR[\FRDWHGVWHHO FI6HFWLRQ DQGPRVWUHSDLUWHFK


QLTXHV RWKHU WKDQ µ&3¶ FI 6HFWLRQ   ,QKLELWRUV FI 6HFWLRQV  DQG   QLTXHV RWKHU WKDQ µ&3¶ FI 6HFWLRQ   ,QKLELWRUV FI 6HFWLRQV  DQG  
DQGFRQFUHWHVXUIDFHSURWHFWLRQ FI6HFWLRQ DUHFRQVLGHUHGWREHSDUWLFX DQGFRQFUHWHVXUIDFHSURWHFWLRQ FI6HFWLRQ DUHFRQVLGHUHGWREHSDUWLFX
ODUO\ FULWLFDO ZLWK UHJDUG WR ORQJWHUP SHUIRUPDQFH %XOOHW   0RUHRYHU FRQ ODUO\ FULWLFDO ZLWK UHJDUG WR ORQJWHUP SHUIRUPDQFH %XOOHW   0RUHRYHU FRQ
FUHWHVXUIDFHSURWHFWLRQV\VWHPVDUHVHQVLWLYHWRYDULDWLRQVLQWKHH[SRVXUHFRQGL FUHWHVXUIDFHSURWHFWLRQV\VWHPVDUHVHQVLWLYHWRYDULDWLRQVLQWKHH[SRVXUHFRQGL
WLRQV %XOOHW  WLRQV %XOOHW 
 $VSHFWVDQGUHTXLUHPHQWVUHODWLQJWRVWUXFWXUDODQGJHQHUDOGXUDELOLW\SHUIRUPDQFH  $VSHFWVDQGUHTXLUHPHQWVUHODWLQJWRVWUXFWXUDODQGJHQHUDOGXUDELOLW\SHUIRUPDQFH
5HODWLQJWRERWKVWUXFWXUDODQGJHQHUDOGXUDELOLW\SHUIRUPDQFHWKHEHORZUHTXLUH 5HODWLQJWRERWKVWUXFWXUDODQGJHQHUDOGXUDELOLW\SHUIRUPDQFHWKHEHORZUHTXLUH
PHQWVDUHFRQVLGHUHGDVFUXFLDOLQWKHGHVLJQSKDVHVDQG FI)LJXUH 7KH PHQWVDUHFRQVLGHUHGDVFUXFLDOLQWKHGHVLJQSKDVHVDQG FI)LJXUH 7KH
FRXQWHUPHDVXUHV VKRXOG QHLWKHU LQWHUIHUH QHJDWLYHO\ ZLWK VWUXFWXUDO SHUIRUPDQFH FRXQWHUPHDVXUHV VKRXOG QHLWKHU LQWHUIHUH QHJDWLYHO\ ZLWK VWUXFWXUDO SHUIRUPDQFH
QRUZLWKGXUDELOLW\DVSHFWVRIWKHUHLQIRUFHPHQWDQGRUWKHFRQFUHWHLWVHOI7KLVLQ QRUZLWKGXUDELOLW\DVSHFWVRIWKHUHLQIRUFHPHQWDQGRUWKHFRQFUHWHLWVHOI7KLVLQ
FOXGHVDPRQJRWKHUV FOXGHVDPRQJRWKHUV
 6WUHQJWKDQGGXFWLOLW\FKDUDFWHULVWLFVRIWKHUHLQIRUFHPHQWVKRXOGQRWEHQHJD  6WUHQJWKDQGGXFWLOLW\FKDUDFWHULVWLFVRIWKHUHLQIRUFHPHQWVKRXOGQRWEHQHJD
WLYHO\LQIOXHQFHG WLYHO\LQIOXHQFHG
1HJDWLYH H[DPSOHV LQFOXGH µ)53¶ FRQFHUQLQJ HJ GXFWLOLW\ FI 6HFWLRQ 1HJDWLYH H[DPSOHV LQFOXGH µ)53¶ FRQFHUQLQJ HJ GXFWLOLW\ FI 6HFWLRQ
 DVZHOODVµ(5$¶DQGµ(&5¶ FI6HFWLRQ ZLWKUHJDUGWRDUHGXF  DVZHOODVµ(5$¶DQGµ(&5¶ FI6HFWLRQ ZLWKUHJDUGWRDUHGXF
WLRQLQERWKVWUHQJWKDQGGXFWLOLW\GXHWRK\GURJHQHPEULWWOHPHQW FI6HFWLRQV WLRQLQERWKVWUHQJWKDQGGXFWLOLW\GXHWRK\GURJHQHPEULWWOHPHQW FI6HFWLRQV
DQG 0RUHRYHUµ&3¶ FI6HFWLRQ DVZHOODVJDOYDQLVDWLRQ FI DQG 0RUHRYHUµ&3¶ FI6HFWLRQ DVZHOODVJDOYDQLVDWLRQ FI
6HFWLRQ   UHTXLUH DWWHQWLRQ FRQFHUQLQJ K\GURJHQ HPEULWWOHPHQW +LJK 6HFWLRQ   UHTXLUH DWWHQWLRQ FRQFHUQLQJ K\GURJHQ HPEULWWOHPHQW +LJK
VWUHQJWK VWHHOV DUH NQRZQ WR EH HVSHFLDOO\ VXVFHSWLEOH WR K\GURJHQ HPEULWWOH VWUHQJWK VWHHOV DUH NQRZQ WR EH HVSHFLDOO\ VXVFHSWLEOH WR K\GURJHQ HPEULWWOH
PHQW FI6HFWLRQ 7KXVKLJKVWUHQJWKVWHHOUHLQIRUFHPHQWZKLFKLVRI PHQW FI6HFWLRQ 7KXVKLJKVWUHQJWKVWHHOUHLQIRUFHPHQWZKLFKLVRI
WHQUHODWHGWRSUHVWUHVVLQJRUSRVWWHQVLRQLQJUHTXLUHVVSHFLDOGHVLJQFRQVLG WHQUHODWHGWRSUHVWUHVVLQJRUSRVWWHQVLRQLQJUHTXLUHVVSHFLDOGHVLJQFRQVLG
HUDWLRQV HUDWLRQV
 6WUHQJWKDQGGXUDELOLW\RIWKHFRQFUHWHVKRXOGQRWEHQHJDWLYHO\LQIOXHQFHG  6WUHQJWKDQGGXUDELOLW\RIWKHFRQFUHWHVKRXOGQRWEHQHJDWLYHO\LQIOXHQFHG
,QSUDFWLFHFULWLFDOHIIHFWVRIFRXQWHUPHDVXUHVRQWKHFRQFUHWHVWUHQJWKRUGX ,QSUDFWLFHFULWLFDOHIIHFWVRIFRXQWHUPHDVXUHVRQWKHFRQFUHWHVWUHQJWKRUGX
UDELOLW\ JHQHUDOO\ UHODWH WR LQWHUIHUHQFH ZLWK FHPHQW K\GUDWLRQ FI 6HFWLRQ UDELOLW\ JHQHUDOO\ UHODWH WR LQWHUIHUHQFH ZLWK FHPHQW K\GUDWLRQ FI 6HFWLRQ
 RUHDUO\DJHFUDFNLQJ FI6HFWLRQ 0RVWFRQFUHWHFRXQWHUPHD  RUHDUO\DJHFUDFNLQJ FI6HFWLRQ 0RVWFRQFUHWHFRXQWHUPHD
VXUHV FI6HFWLRQ FDQLQWHUIHUHZLWKFHPHQWK\GUDWLRQZKLOHUHLQIRUFH VXUHV FI6HFWLRQ FDQLQWHUIHUHZLWKFHPHQWK\GUDWLRQZKLOHUHLQIRUFH
PHQWPHDVXUHVGRJHQHUDOO\QRWDIIHFWWKHFKHPLVWU\RIWKHFRQFUHWH+RZHYHU PHQWPHDVXUHVGRJHQHUDOO\QRWDIIHFWWKHFKHPLVWU\RIWKHFRQFUHWH+RZHYHU
WKHVWUHQJWKGHYHORSPHQWRIWKHFRQFUHWHVWHHOLQWHUIDFHFDQEHDIIHFWHGE\UH WKHVWUHQJWKGHYHORSPHQWRIWKHFRQFUHWHVWHHOLQWHUIDFHFDQEHDIIHFWHGE\UH
LQIRUFHPHQWFRXQWHUPHDVXUHV FI%XOOHW :LWKUHJDUGWRHDUO\DJHFUDFN LQIRUFHPHQWFRXQWHUPHDVXUHV FI%XOOHW :LWKUHJDUGWRHDUO\DJHFUDFN
LQJ µ+3&¶ FI 6HFWLRQ   DQG LQWHJUDO LQKLELWRUV FI 6HFWLRQ   LQJ µ+3&¶ FI 6HFWLRQ   DQG LQWHJUDO LQKLELWRUV FI 6HFWLRQ  
PD\EHRIFRQFHUQ PD\EHRIFRQFHUQ
 %RQG SURSHUWLHV LH WKH GHYHORSPHQW RI VWUHQJWK DQG FKHPLFDO ERQG DW WKH  %RQG SURSHUWLHV LH WKH GHYHORSPHQW RI VWUHQJWK DQG FKHPLFDO ERQG DW WKH
FRQFUHWHVWHHOLQWHUIDFH FI6HFWLRQ VKRXOGQRWEHQHJDWLYHO\LQIOXHQFHG FRQFUHWHVWHHOLQWHUIDFH FI6HFWLRQ VKRXOGQRWEHQHJDWLYHO\LQIOXHQFHG
1HJDWLYH H[DPSOHV LQFOXGH WKH FRXQWHUPHDVXUHV UHODWHG WR K\GURJHQ HPEULW 1HJDWLYH H[DPSOHV LQFOXGH WKH FRXQWHUPHDVXUHV UHODWHG WR K\GURJHQ HPEULW
WOHPHQW FI%XOOHW DVZHOODVDOOFRQFUHWHFRXQWHUPHDVXUHVDIIHFWLQJFRQ WOHPHQW FI%XOOHW DVZHOODVDOOFRQFUHWHFRXQWHUPHDVXUHVDIIHFWLQJFRQ
FUHWH SURSHUWLHV FI %XOOHW   0RUHRYHU FRSSHU FODGGLQJ FI 6HFWLRQ FUHWH SURSHUWLHV FI %XOOHW   0RUHRYHU FRSSHU FODGGLQJ FI 6HFWLRQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 'HVLJQ$VSHFWVDQG5HTXLUHPHQWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 'HVLJQ$VSHFWVDQG5HTXLUHPHQWV

 DQGJDOYDQLVDWLRQ FI6HFWLRQ DUHNQRZQWRLQWHUIHUHZLWKK\  DQGJDOYDQLVDWLRQ FI6HFWLRQ DUHNQRZQWRLQWHUIHUHZLWKK\


GUDWLRQDWWKHFRQFUHWHVWHHOLQWHUIDFH  GUDWLRQDWWKHFRQFUHWHVWHHOLQWHUIDFH 
%HVLGHV WKH DERYH OLVWHG UHTXLUHPHQWV WKH QHZ FRXQWHUPHDVXUH VKRXOG JHQHUDOO\ %HVLGHV WKH DERYH OLVWHG UHTXLUHPHQWV WKH QHZ FRXQWHUPHDVXUH VKRXOG JHQHUDOO\
QRWFRPSURPLVHDQ\RWKHURIWKHRYHUDOOEHQHILWVRIWKHFRQFUHWHVWHHOV\VWHPHJ QRWFRPSURPLVHDQ\RWKHURIWKHRYHUDOOEHQHILWVRIWKHFRQFUHWHVWHHOV\VWHPHJ
WKHUPDOFRPSDWLELOLW\ FI6HFWLRQ  WKHUPDOFRPSDWLELOLW\ FI6HFWLRQ 
 $VSHFWVDQGUHTXLUHPHQWVUHODWLQJWRFUDFNLQJRIWKHFRQFUHWH  $VSHFWVDQGUHTXLUHPHQWVUHODWLQJWRFUDFNLQJRIWKHFRQFUHWH
,Q DGGLWLRQ WR WKH UHTXLUHPHQWV UHJDUGLQJ FRUURVLRQ UHVLVWDQFH DQG GXUDELOLW\ DV ,Q DGGLWLRQ WR WKH UHTXLUHPHQWV UHJDUGLQJ FRUURVLRQ UHVLVWDQFH DQG GXUDELOLW\ DV
SHFWVVWDWHGLQ%XOOHWVDQGWKHIROORZLQJUHTXLUHPHQWVFRQFHUQLQJFUDFNLQJRI SHFWVVWDWHGLQ%XOOHWVDQGWKHIROORZLQJUHTXLUHPHQWVFRQFHUQLQJFUDFNLQJRI
WKHFRQFUHWHDUHWDNHQLQWRDFFRXQW WKHFRQFUHWHDUHWDNHQLQWRDFFRXQW
 6LQFHLWLVSUDFWLFDOO\LPSRVVLEOHWRSUHYHQWWKHFRQFUHWHFRYHUIURPFUDFNLQJ  6LQFHLWLVSUDFWLFDOO\LPSRVVLEOHWRSUHYHQWWKHFRQFUHWHFRYHUIURPFUDFNLQJ
WRDOHVVHURUODUJHUH[WHQW FI6HFWLRQ FUDFNLQJLVWDNHQLQWRFRQVLG WRDOHVVHURUODUJHUH[WHQW FI6HFWLRQ FUDFNLQJLVWDNHQLQWRFRQVLG
HUDWLRQ LQ WKH GHYHORSPHQW $ FUDFN ZLGWK RI PP DW WKH OHYHO RI WKH UHLQ HUDWLRQ LQ WKH GHYHORSPHQW $ FUDFN ZLGWK RI PP DW WKH OHYHO RI WKH UHLQ
IRUFHPHQWLVSURSRVHGIRUWKHFRQFHSWXDOGHVLJQ IRUFHPHQWLVSURSRVHGIRUWKHFRQFHSWXDOGHVLJQ
 &UDFNLQJGXHWRWKHIRUPDWLRQRIYROXPLQRXVFRUURVLRQSURGXFWVIRUPHGGXU  &UDFNLQJGXHWRWKHIRUPDWLRQRIYROXPLQRXVFRUURVLRQSURGXFWVIRUPHGGXU
LQJFRUURVLRQSURSDJDWLRQ FI6HFWLRQ LVWREHRPLWWHGLHIRUPDWLRQ LQJFRUURVLRQSURSDJDWLRQ FI6HFWLRQ LVWREHRPLWWHGLHIRUPDWLRQ
RIEXON\SURGXFWVLVWREHSUHYHQWHG RIEXON\SURGXFWVLVWREHSUHYHQWHG
 3UDFWLFDODVSHFWVDQGUHTXLUHPHQWV  3UDFWLFDODVSHFWVDQGUHTXLUHPHQWV
3UDFWLFDO UHTXLUHPHQWV DUH ODUJHO\ LQWHUFRQQHFWHG ZLWK HFRQRPLFDO UHTXLUHPHQWV 3UDFWLFDO UHTXLUHPHQWV DUH ODUJHO\ LQWHUFRQQHFWHG ZLWK HFRQRPLFDO UHTXLUHPHQWV
DQGWKXVDFHQWUDODVSHFWLQWKHJHQHUDOFRQVLGHUDWLRQV0RUHRYHUWKH\UHODWHWRWKH DQGWKXVDFHQWUDODVSHFWLQWKHJHQHUDOFRQVLGHUDWLRQV0RUHRYHUWKH\UHODWHWRWKH
SURGXFWLRQDQGLPSOHPHQWDWLRQDQGKHQFHWRERWKSKDVHVDQG FI)LJXUH  SURGXFWLRQDQGLPSOHPHQWDWLRQDQGKHQFHWRERWKSKDVHVDQG FI)LJXUH 
:LWKUHJDUGWRWKHLPPHQVHSURSRUWLRQVDQGTXDQWLWLHVSURGXFHG FI6HFWLRQ  :LWKUHJDUGWRWKHLPPHQVHSURSRUWLRQVDQGTXDQWLWLHVSURGXFHG FI6HFWLRQ 
SURFHGXUHV GXULQJ SURGXFWLRQ DQG SODFLQJ DUH RI VSHFLDO FRQFHUQ LQ WKH FRQFUHWH SURFHGXUHV GXULQJ SURGXFWLRQ DQG SODFLQJ DUH RI VSHFLDO FRQFHUQ LQ WKH FRQFUHWH
EXVLQHVV7KXVWKHQHZFRXQWHUPHDVXUHVVKRXOG EXVLQHVV7KXVWKHQHZFRXQWHUPHDVXUHVVKRXOG
 1RWQHJDWLYHO\LQWHUIHUHZLWKWKHFRPPRQSUDFWLFHVDQGDFWLYLWLHVRQVLWHLH  1RWQHJDWLYHO\LQWHUIHUHZLWKWKHFRPPRQSUDFWLFHVDQGDFWLYLWLHVRQVLWHLH
QRW UHTXLUH VSHFLDO RU FRPSOLFDWHG SURFHGXUHV GXULQJ RQVLWH SHUIRUPDQFHV QRW UHTXLUH VSHFLDO RU FRPSOLFDWHG SURFHGXUHV GXULQJ RQVLWH SHUIRUPDQFHV
HJ PDQXIDFWXUH RI WKH UHLQIRUFHPHQW DQG IRUPZRUN DV ZHOO DV SODFLQJ DQG HJ PDQXIDFWXUH RI WKH UHLQIRUFHPHQW DQG IRUPZRUN DV ZHOO DV SODFLQJ DQG
FXULQJRIWKHFRQFUHWH  FXULQJRIWKHFRQFUHWH 
 1RWEHVHQVLWLYHWRWKHTXDOLW\RIZRUNPDQVKLSRQVLWHDQGEHDEOHWRWROHUDWHD  1RWEHVHQVLWLYHWRWKHTXDOLW\RIZRUNPDQVKLSRQVLWHDQGEHDEOHWRWROHUDWHD
FHUWDLQGHJUHHRILQVXIILFLHQF\RUGDPDJHGXULQJSURGXFWLRQDQGLPSOHPHQWD FHUWDLQGHJUHHRILQVXIILFLHQF\RUGDPDJHGXULQJSURGXFWLRQDQGLPSOHPHQWD
WLRQ‚ WLRQ‚
 5HTXLUHRQO\PLQRU RULGHDOO\QR DWWHQWLRQRUPDLQWHQDQFHDIWHULPSOHPHQ  5HTXLUHRQO\PLQRU RULGHDOO\QR DWWHQWLRQRUPDLQWHQDQFHDIWHULPSOHPHQ
WDWLRQ WDWLRQ
 

+RZHYHUZHWKLQNWKDWWKHUHOHYDQFHRIWKHFKHPLFDOERQGEHWZHHQVWHHODQGFRQFUHWHRIWHQVHHPVWR +RZHYHUZHWKLQNWKDWWKHUHOHYDQFHRIWKHFKHPLFDOERQGEHWZHHQVWHHODQGFRQFUHWHRIWHQVHHPVWR
EHRYHUUDWHGZLWKUHJDUGWRPHFKDQLFDOSURSHUWLHVDVWKHPDMRUSDUWRIWKHIRUFHWUDQVIHULVJHQHUDOO\ EHRYHUUDWHGZLWKUHJDUGWRPHFKDQLFDOSURSHUWLHVDVWKHPDMRUSDUWRIWKHIRUFHWUDQVIHULVJHQHUDOO\
HVWDEOLVKHGE\WKHPHFKDQLFDOLQWHUORFNLQJDFKLHYHGE\WKHULEV FI6HFWLRQ  HVWDEOLVKHGE\WKHPHFKDQLFDOLQWHUORFNLQJDFKLHYHGE\WKHULEV FI6HFWLRQ 
‚ ‚
:KLOHSURGXFWLRQDQGLPSOHPHQWDWLRQJHQHUDOO\FRLQFLGHQFHIRUFRQFUHWHFRXQWHUPHDVXUHVWKHVH :KLOHSURGXFWLRQDQGLPSOHPHQWDWLRQJHQHUDOO\FRLQFLGHQFHIRUFRQFUHWHFRXQWHUPHDVXUHVWKHVH
SKDVHVFDQEHGLVWLQJXLVKHGIRUUHLQIRUFHPHQWFRXQWHUPHDVXUHVFRQVLGHULQJWKHHVWDEOLVKPHQWRI SKDVHVFDQEHGLVWLQJXLVKHGIRUUHLQIRUFHPHQWFRXQWHUPHDVXUHVFRQVLGHULQJWKHHVWDEOLVKPHQWRI
HOHFWULFDOFRQQHFWLYLW\DVSURGXFWLRQIRUµ&3UH¶DQGµ&3¶ FI6HFWLRQ  HOHFWULFDOFRQQHFWLYLW\DVSURGXFWLRQIRUµ&3UH¶DQGµ&3¶ FI6HFWLRQ 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


'HVLJQ$VSHFWVDQG5HTXLUHPHQWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 'HVLJQ$VSHFWVDQG5HTXLUHPHQWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV

([FHSWIURPFRQFUHWHVXUIDFHSURWHFWLRQ FI6HFWLRQ DQGHOHFWURFKHPLFDO ([FHSWIURPFRQFUHWHVXUIDFHSURWHFWLRQ FI6HFWLRQ DQGHOHFWURFKHPLFDO


WHFKQLTXHV FI 6HFWLRQ   WKH FRXQWHUPHDVXUHV OLVWHG LQ 6HFWLRQ  IXOILO UH WHFKQLTXHV FI 6HFWLRQ   WKH FRXQWHUPHDVXUHV OLVWHG LQ 6HFWLRQ  IXOILO UH
TXLUHPHQW+RZHYHUYDULRXVFRXQWHUPHDVXUHVFRQIOLFWZLWKUHTXLUHPHQWV TXLUHPHQW+RZHYHUYDULRXVFRXQWHUPHDVXUHVFRQIOLFWZLWKUHTXLUHPHQWV
DQG)RULQVWDQFHµ+3&¶ FI6HFWLRQ DQGFRQFUHWHVXUIDFHSURWHFWLRQ DQG)RULQVWDQFHµ+3&¶ FI6HFWLRQ DQGFRQFUHWHVXUIDFHSURWHFWLRQ
FI6HFWLRQ DUHVHQVLWLYHWRWKHTXDOLW\RIZRUNPDQVKLSµ)53¶ FI6HF FI6HFWLRQ DUHVHQVLWLYHWRWKHTXDOLW\RIZRUNPDQVKLSµ)53¶ FI6HF
WLRQ   GRHV QRW DOORZ IRU FXVWRP RQVLWH SUDFWLFHV :LWK UHJDUG WR HSR[\ WLRQ   GRHV QRW DOORZ IRU FXVWRP RQVLWH SUDFWLFHV :LWK UHJDUG WR HSR[\
FRDWLQJ FI 6HFWLRQ   DQG PHWDOOLF FODGGLQJ FI 6HFWLRQ   FRQFHUQV FRDWLQJ FI 6HFWLRQ   DQG PHWDOOLF FODGGLQJ FI 6HFWLRQ   FRQFHUQV
ZLWK UHJDUG WR ERWK WKH VHQVLWLYLW\ RI SURGXFWLRQ DQG H[HFXWLRQ FRXOG EH UDLVHG ZLWK UHJDUG WR ERWK WKH VHQVLWLYLW\ RI SURGXFWLRQ DQG H[HFXWLRQ FRXOG EH UDLVHG
QHLWKHUFDQEHDGMXVWHGRQVLWH 0RUHRYHUSRVWFDVWLQJGHQVLILFDWLRQWHFKQLTXHV QHLWKHUFDQEHDGMXVWHGRQVLWH 0RUHRYHUSRVWFDVWLQJGHQVLILFDWLRQWHFKQLTXHV
FI 6HFWLRQ   DV ZHOO DV HOHFWURFKHPLFDO FRQFUHWHVWHHO LQWHUIDFH LPSURYH FI 6HFWLRQ   DV ZHOO DV HOHFWURFKHPLFDO FRQFUHWHVWHHO LQWHUIDFH LPSURYH
PHQW FI6HFWLRQ LQWHUIHUHZLWKWKHDERYHSUDFWLFDOUHTXLUHPHQWV PHQW FI6HFWLRQ LQWHUIHUHZLWKWKHDERYHSUDFWLFDOUHTXLUHPHQWV
7KH SRVVLELOLW\ RI FRPELQLQJ WKH QHZ FRXQWHUPHDVXUH ZLWK FDUERQ VWHHO UHLQ 7KH SRVVLELOLW\ RI FRPELQLQJ WKH QHZ FRXQWHUPHDVXUH ZLWK FDUERQ VWHHO UHLQ
IRUFHPHQW LH VHOHFWLYH XVH RI WKH FRXQWHUPHDVXUH FI VHOHFWLYH XVH RI VWDLQOHVV IRUFHPHQW LH VHOHFWLYH XVH RI WKH FRXQWHUPHDVXUH FI VHOHFWLYH XVH RI VWDLQOHVV
VWHHO LQ 6HFWLRQ   LV QRW UHJDUGHG DV D UHTXLUHPHQW SHU VH EXW WDNHQ LQWR VWHHO LQ 6HFWLRQ   LV QRW UHJDUGHG DV D UHTXLUHPHQW SHU VH EXW WDNHQ LQWR
FRQVLGHUDWLRQLQWKHGHYHORSPHQWWRDFFRXQWIRU JDOYDQLFHIIHFWVGXHWRLQWHQGHG FRQVLGHUDWLRQLQWKHGHYHORSPHQWWRDFFRXQWIRU JDOYDQLFHIIHFWVGXHWRLQWHQGHG
RUXQLQWHQGHGHOHFWULFDOFRQQHFWLRQ RUXQLQWHQGHGHOHFWULFDOFRQQHFWLRQ
 (FRQRPLFDODVSHFWVDQGUHTXLUHPHQWV  (FRQRPLFDODVSHFWVDQGUHTXLUHPHQWV
$V PHQWLRQHG XQGHU %XOOHW  SUDFWLFDO DQG HFRQRPLFDO UHTXLUHPHQWV DUH FORVHO\ $V PHQWLRQHG XQGHU %XOOHW  SUDFWLFDO DQG HFRQRPLFDO UHTXLUHPHQWV DUH FORVHO\
LQWHUUHODWHG ,PSRUWDQW DGGLWLRQDO HFRQRPLFDO UHTXLUHPHQWV WR EH WDNHQ LQWR DF LQWHUUHODWHG ,PSRUWDQW DGGLWLRQDO HFRQRPLFDO UHTXLUHPHQWV WR EH WDNHQ LQWR DF
FRXQW UHODWH WR DYDLODELOLW\ DQG SULFH RI WKH EDVH PDWHULDOV DV ZHOO DV WR WKH H[ FRXQW UHODWH WR DYDLODELOLW\ DQG SULFH RI WKH EDVH PDWHULDOV DV ZHOO DV WR WKH H[
SHQVHV IRU SURGXFWLRQ DQG LPSOHPHQWDWLRQ 7KH FRXQWHUPHDVXUH VKRXOG EH EDVHG SHQVHV IRU SURGXFWLRQ DQG LPSOHPHQWDWLRQ 7KH FRXQWHUPHDVXUH VKRXOG EH EDVHG
RQ DEXQGDQWO\ DYDLODEOH DQG LQH[SHQVLYH UDZ PDWHULDOV DQG RQ DQ LQH[SHQVLYH RQ DEXQGDQWO\ DYDLODEOH DQG LQH[SHQVLYH UDZ PDWHULDOV DQG RQ DQ LQH[SHQVLYH
SURGXFWLRQSURFHVV$VLOOXVWUDWHGLQ7DEOHLQ6HFWLRQQHJDWLYHH[DPSOHV SURGXFWLRQSURFHVV$VLOOXVWUDWHGLQ7DEOHLQ6HFWLRQQHJDWLYHH[DPSOHV
LQWKLVFRQQHFWLRQDUHIRUHPRVWVWDLQOHVVVWHHOZLWKUHJDUGWRWKHSULFHRIWKHUDZ LQWKLVFRQQHFWLRQDUHIRUHPRVWVWDLQOHVVVWHHOZLWKUHJDUGWRWKHSULFHRIWKHUDZ
PDWHULDOV FI 6HFWLRQ   FHUWDLQ W\SHV RI FRQFUHWH VXUIDFH SURWHFWLRQ FI PDWHULDOV FI 6HFWLRQ   FHUWDLQ W\SHV RI FRQFUHWH VXUIDFH SURWHFWLRQ FI
6HFWLRQ DVZHOODVµ&3UH¶ FI6HFWLRQ DQGHOHFWURFKHPLFDOWHFK 6HFWLRQ DVZHOODVµ&3UH¶ FI6HFWLRQ DQGHOHFWURFKHPLFDOWHFK
QLTXHV LQ JHQHUDO FI 6HFWLRQ   0RUHRYHU ZH WKLQN WKDW FRPSDUHG WR WKH QLTXHV LQ JHQHUDO FI 6HFWLRQ   0RUHRYHU ZH WKLQN WKDW FRPSDUHG WR WKH
UHODWLYHO\ORZSULFHVVWDWHGLQWKHOLWHUDWXUH FI7DEOH SURSHUSURGXFWLRQDQG UHODWLYHO\ORZSULFHVVWDWHGLQWKHOLWHUDWXUH FI7DEOH SURSHUSURGXFWLRQDQG
LPSOHPHQWDWLRQ RI HSR[\FRDWHG UHLQIRUFHPHQW UHTXLUHV VLJQLILFDQWO\ KLJKHU SUR LPSOHPHQWDWLRQ RI HSR[\FRDWHG UHLQIRUFHPHQW UHTXLUHV VLJQLILFDQWO\ KLJKHU SUR
GXFWLRQFRVWV FI6HFWLRQ  GXFWLRQFRVWV FI6HFWLRQ 
2XU RYHUDOO DSSURDFK ZLWK UHJDUG WR HFRQRPLFDO FRQVLGHUDWLRQV LVWRWDNHFDUERQ 2XU RYHUDOO DSSURDFK ZLWK UHJDUG WR HFRQRPLFDO FRQVLGHUDWLRQV LVWRWDNHFDUERQ
VWHHODVWKHEDVLVZKLOHWKHXSSHUOLPLWLVVHHQWREHGHWHUPLQHGE\WKHLQLWLDOFRVW VWHHODVWKHEDVLVZKLOHWKHXSSHUOLPLWLVVHHQWREHGHWHUPLQHGE\WKHLQLWLDOFRVW
RI VWDLQOHVV VWHHO FI 7DEOH   $Q HIILFLHQW FRVW VDYLQJ LV FRQVLGHUHG WR EH RI VWDLQOHVV VWHHO FI 7DEOH   $Q HIILFLHQW FRVW VDYLQJ LV FRQVLGHUHG WR EH
DFKLHYHGZKHQWKHLQLWLDOFRVWVDUHUHGXFHGE\LHWLPHVWKHLQLWLDOFRVW DFKLHYHGZKHQWKHLQLWLDOFRVWVDUHUHGXFHGE\LHWLPHVWKHLQLWLDOFRVW
RIFDUERQVWHHOUHLQIRUFHPHQWZKLOHSURYLGLQJIRUFRUURVLRQSURWHFWLRQVLPLODUWR RIFDUERQVWHHOUHLQIRUFHPHQWZKLOHSURYLGLQJIRUFRUURVLRQSURWHFWLRQVLPLODUWR
WKH RQH RI VWDLQOHVV VWHHO +RZHYHU RXU DLP LV WR FRPSHWH ZLWK WKH LQLWLDO SULFH WKH RQH RI VWDLQOHVV VWHHO +RZHYHU RXU DLP LV WR FRPSHWH ZLWK WKH LQLWLDO SULFH
UDQJHRIJDOYDQLVHGVWHHORUXQGHUFXWWLQJLWLHWRVWD\EHORZWZLFHWKHLQLWLDOFRVW UDQJHRIJDOYDQLVHGVWHHORUXQGHUFXWWLQJLWLHWRVWD\EHORZWZLFHWKHLQLWLDOFRVW
RIFDUERQVWHHOUHLQIRUFHPHQW RIFDUERQVWHHOUHLQIRUFHPHQW
 (FRORJLFDODVSHFWVDQGUHTXLUHPHQWV  (FRORJLFDODVSHFWVDQGUHTXLUHPHQWV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 7KHRUHWLFDO'HVLJQ$SSURDFK 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 7KHRUHWLFDO'HVLJQ$SSURDFK

7KHILQDOGHVLJQUHTXLUHPHQWUHODWHVWRHFRORJLFFRQVLGHUDWLRQV$VPHQWLRQHGLQ 7KHILQDOGHVLJQUHTXLUHPHQWUHODWHVWRHFRORJLFFRQVLGHUDWLRQV$VPHQWLRQHGLQ
6HFWLRQFDOFLXPQLWULWHDQGFKURPDWHVDUHWR[LFDQGDSSOLFDWLRQLVWKHUH 6HFWLRQFDOFLXPQLWULWHDQGFKURPDWHVDUHWR[LFDQGDSSOLFDWLRQLVWKHUH
IRUHODUJHO\OLPLWHG DWOHDVWLQ(XURSH ,QDGGLWLRQWRDYRLGLQJVXFKSRWHQWLDOO\ IRUHODUJHO\OLPLWHG DWOHDVWLQ(XURSH ,QDGGLWLRQWRDYRLGLQJVXFKSRWHQWLDOO\
FULWLFDO LQWHUIHUHQFH LQ VHUYLFH WKH QHZ FRXQWHUPHDVXUH VKRXOG DOVR DLP DW HFR FULWLFDO LQWHUIHUHQFH LQ VHUYLFH WKH QHZ FRXQWHUPHDVXUH VKRXOG DOVR DLP DW HFR
ORJLFDOVROXWLRQV LQSDUWLFXODUIUHHRISHUVRQDOKD]DUGV GXULQJSURGXFWLRQDQGRU ORJLFDOVROXWLRQV LQSDUWLFXODUIUHHRISHUVRQDOKD]DUGV GXULQJSURGXFWLRQDQGRU
LPSOHPHQWDWLRQ %HVLGHV LQKLELWRUV FI6HFWLRQVDQG DQGVRPHW\SHV LPSOHPHQWDWLRQ %HVLGHV LQKLELWRUV FI6HFWLRQVDQG DQGVRPHW\SHV
RIFRQFUHWHVXUIDFHSURWHFWLRQ FI6HFWLRQ WKDWPD\EHKD]DUGRXVLQSUR RIFRQFUHWHVXUIDFHSURWHFWLRQ FI6HFWLRQ WKDWPD\EHKD]DUGRXVLQSUR
GXFWLRQ DQG LPSOHPHQWDWLRQ µ)53¶ FI 6HFWLRQ   DQG RUJDQLF UHLQIRUFH GXFWLRQ DQG LPSOHPHQWDWLRQ µ)53¶ FI 6HFWLRQ   DQG RUJDQLF UHLQIRUFH
PHQWFRDWLQJV FI6HFWLRQ DUHFRQVLGHUHGWRSRVHVXFKXQGHVLUHGLQWHUIHU PHQWFRDWLQJV FI6HFWLRQ DUHFRQVLGHUHGWRSRVHVXFKXQGHVLUHGLQWHUIHU
HQFHVLQWKHSURGXFWLRQVWDJH HQFHVLQWKHSURGXFWLRQVWDJH

 7KHRUHWLFDO'HVLJQ$SSURDFK  7KHRUHWLFDO'HVLJQ$SSURDFK


7KH GHVFULSWLRQ RI RXU WKHRUHWLFDO GHVLJQ DSSURDFK LV VXEGLYLGHG LQ WKHUPRG\QDPLF 7KH GHVFULSWLRQ RI RXU WKHRUHWLFDO GHVLJQ DSSURDFK LV VXEGLYLGHG LQ WKHUPRG\QDPLF
DQG NLQHWLF FRQVLGHUDWLRQV ZKLFK DUH GLVFXVVHG LQ 6HFWLRQV  DQG  7KHVH DQG NLQHWLF FRQVLGHUDWLRQV ZKLFK DUH GLVFXVVHG LQ 6HFWLRQV  DQG  7KHVH
FRQVLGHUDWLRQVOHDGWRWZRSULQFLSOHVRILPSOHPHQWDWLRQRIWKHSURSRVHGFRXQWHUPHD FRQVLGHUDWLRQVOHDGWRWZRSULQFLSOHVRILPSOHPHQWDWLRQRIWKHSURSRVHGFRXQWHUPHD
VXUHVLHEDVHGRQUHEDUVXUIDFHPRGLILFDWLRQRURQHPEHGGHGHOHFWURGHVZKLFKZLOO VXUHVLHEDVHGRQUHEDUVXUIDFHPRGLILFDWLRQRURQHPEHGGHGHOHFWURGHVZKLFKZLOO
EHGHDOWZLWKLQ6HFWLRQ EHGHDOWZLWKLQ6HFWLRQ

 7KHUPRG\QDPLF'HVLJQ$SSURDFK  7KHUPRG\QDPLF'HVLJQ$SSURDFK


:LWKWKHH[FHSWLRQRIFRUURVLRQLQKLELWRUV FI6HFWLRQ ZHFRQVLGHUFRQFUHWH :LWKWKHH[FHSWLRQRIFRUURVLRQLQKLELWRUV FI6HFWLRQ ZHFRQVLGHUFRQFUHWH
FRXQWHUPHDVXUHV FI6HFWLRQ WRDFWUDWKHUNLQHWLFDOO\WKDQWKHUPRG\QDPLFDOO\ FRXQWHUPHDVXUHV FI6HFWLRQ WRDFWUDWKHUNLQHWLFDOO\WKDQWKHUPRG\QDPLFDOO\
7KXVWKH\SOD\DPRUHVLJQLILFDQWUROHLQ6HFWLRQGHDOLQJZLWKNLQHWLFFRQVLGHUD 7KXVWKH\SOD\DPRUHVLJQLILFDQWUROHLQ6HFWLRQGHDOLQJZLWKNLQHWLFFRQVLGHUD
WLRQV  WLRQV 
&RQFHUQLQJ UHLQIRUFHPHQW FRXQWHUPHDVXUHV ZH UXOHG RXW µ)53¶ DQG HSR[\FRDWHG &RQFHUQLQJ UHLQIRUFHPHQW FRXQWHUPHDVXUHV ZH UXOHG RXW µ)53¶ DQG HSR[\FRDWHG
UHLQIRUFHPHQWIURPRXU IXUWKHUFRQVLGHUDWLRQVEDVHGRQWKHPDMRU LQWHUIHUHQFHV ZLWK UHLQIRUFHPHQWIURPRXU IXUWKHUFRQVLGHUDWLRQVEDVHGRQWKHPDMRU LQWHUIHUHQFHVZLWK
WKH UHTXLUHPHQWV VWDWHG LQ 6HFWLRQ  +HQFH WKH DYDLODEOH WKHUPRG\QDPLF RSWLRQV WKH UHTXLUHPHQWV VWDWHG LQ 6HFWLRQ  +HQFH WKH DYDLODEOH WKHUPRG\QDPLF RSWLRQV
IRUFRUURVLRQSURWHFWLRQ RIQHZVWUXFWXUHVFDQEHUHSUHVHQWHGDVLOOXVWUDWHGLQ)LJXUH IRUFRUURVLRQSURWHFWLRQ RIQHZVWUXFWXUHVFDQEHUHSUHVHQWHGDVLOOXVWUDWHGLQ)LJXUH
 
7KHµ(FRUU¶DQGS+DUHDLQXQFRQWDPLQDWHGFRQFUHWHDQGWKHFULWLFDOµ(FRUU¶DQGS+DUHD 7KHµ(FRUU¶DQGS+DUHDLQXQFRQWDPLQDWHGFRQFUHWHDQGWKHFULWLFDOµ(FRUU¶DQGS+DUHD
IRUFRUURVLRQLQLWLDWLRQDUHLGHQWLILHGE\FDVHV $ DQG % LQ)LJXUH>$@>%@DQG IRUFRUURVLRQLQLWLDWLRQDUHLGHQWLILHGE\FDVHV $ DQG % LQ)LJXUH>$@>%@DQG
>&@ &DVHV &  DQG '  LQ )LJXUH  >$@ UHSUHVHQW FDWKRGLF DQG DQRGLF SRODULVDWLRQ >&@ &DVHV &  DQG '  LQ )LJXUH  >$@ UHSUHVHQW FDWKRGLF DQG DQRGLF SRODULVDWLRQ
ZLWKWKHREMHFWLYHRIPRYLQJµ(FRUU¶DZD\ IURPWKHFULWLFDOVWDELOLW\GRPDLQVRI)H ZLWKWKHREMHFWLYHRIPRYLQJµ(FRUU¶DZD\ IURPWKHFULWLFDOVWDELOLW\GRPDLQVRI)H
DQG )H&O0HDVXUHVWRDYRLGWKHS+GHFUHDVH DUH LQGLFDWHGE\ WKH GDVKHGOLQHEH DQG )H&O0HDVXUHVWRDYRLGWKHS+GHFUHDVH DUH LQGLFDWHGE\ WKH GDVKHGOLQHEH
WZHHQFDVHV % DQG $ $SDUWIURPWKHPDUJLQDODSSOLFDWLRQVRIµ(5$¶LQUHSDLU FI WZHHQFDVHV % DQG $ $SDUWIURPWKHPDUJLQDODSSOLFDWLRQVRIµ(5$¶LQUHSDLU FI
6HFWLRQ WKLVRSWLRQLVLPSUDFWLFDODQGGLIILFXOWWRUHDOLVHLQSUDFWLFH+RZHYHU 6HFWLRQ WKLVRSWLRQLVLPSUDFWLFDODQGGLIILFXOWWRUHDOLVHLQSUDFWLFH+RZHYHU

 

$OWKRXJKWKHLPSOHPHQWDWLRQRIHOHFWURFKHPLFDOFRQFUHWHVWHHOLQWHUIDFHLPSURYHPHQWLVEDVHGRQ $OWKRXJKWKHLPSOHPHQWDWLRQRIHOHFWURFKHPLFDOFRQFUHWHVWHHOLQWHUIDFHLPSURYHPHQWLVEDVHGRQ
WKHUPRG\QDPLFSULQFLSOHVLWVHIIHFW LHWKHGHQVLILFDWLRQ LVFRQVLGHUHGWRDFWNLQHWLFDOO\UDWKHUWKDQ WKHUPRG\QDPLFSULQFLSOHVLWVHIIHFW LHWKHGHQVLILFDWLRQ LVFRQVLGHUHGWRDFWNLQHWLFDOO\UDWKHUWKDQ
WKHUPRG\QDPLFDOO\ WKHUPRG\QDPLFDOO\

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHRUHWLFDO'HVLJQ$SSURDFK 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 7KHRUHWLFDO'HVLJQ$SSURDFK 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV

RSWLRQV & DQG ' DUHIHDVLEOHWKHUPRG\QDPLFWHFKQLTXHVZKLFKFDQEHUHDOLVHGE\ RSWLRQV & DQG ' DUHIHDVLEOHWKHUPRG\QDPLFWHFKQLTXHVZKLFKFDQEHUHDOLVHGE\
FDWKRGLFDQGDQRGLFSRODULVDWLRQUHVSHFWLYHO\ FDWKRGLFDQGDQRGLFSRODULVDWLRQUHVSHFWLYHO\

 
)LJXUH ,GHQWLILFDWLRQ RI µ(FRUU¶ DQG S+ DUHD LQ D QHZ VWUXFWXUH $ EOXH GRW  )LJXUH ,GHQWLILFDWLRQ RI µ(FRUU¶ DQG S+ DUHD LQ D QHZ VWUXFWXUH $ EOXH GRW 
DQGRIFULWLFDOµ(FRUU¶DQGS+DUHD FI)LJXUH IRUFRUURVLRQLQL DQGRIFULWLFDOµ(FRUU¶DQGS+DUHD FI)LJXUH IRUFRUURVLRQLQL
WLDWLRQ LQ D FRQWDPLQDWHG VWUXFWXUH % \HOORZ GRW  RQ GLIIHUHQW WLDWLRQ LQ D FRQWDPLQDWHG VWUXFWXUH % \HOORZ GRW  RQ GLIIHUHQW
µ6,3'V¶ >$@ µ6,3'¶ RI )H+2 µ6(3'¶ RQ )H&O+2 µ0(3'¶ FI µ6,3'V¶ >$@ µ6,3'¶ RI )H+2 µ6(3'¶ RQ )H&O+2 µ0(3'¶ FI
)LJXUH   DQG LOOXVWUDWLRQ RI SRWHQWLDO WKHUPRG\QDPLF DSSURDFKHV )LJXUH   DQG LOOXVWUDWLRQ RI SRWHQWLDO WKHUPRG\QDPLF DSSURDFKHV
IRUSURWHFWLRQ &DQG'JUHHQGRWV >%@µ6,3'¶RIVWDELOLW\GRPDLQV IRUSURWHFWLRQ &DQG'JUHHQGRWV >%@µ6,3'¶RIVWDELOLW\GRPDLQV
RI VHOHFWHG VWDLQOHVV VWHHO DOOR\ R[LGHV FI )LJXUH   RQ )H&O+2 RI VHOHFWHG VWDLQOHVV VWHHO DOOR\ R[LGHV FI )LJXUH   RQ )H&O+2
µ0(3'¶ FI )LJXUH  >%@  >&@ µ6,3'¶ RI &X&O+2 µ0(3'¶ RQ µ0(3'¶ FI )LJXUH  >%@  >&@ µ6,3'¶ RI &X&O+2 µ0(3'¶ RQ
)H&O+2µ0(3'¶ FI)LJXUH>%@  )H&O+2µ0(3'¶ FI)LJXUH>%@ 
,Q FRQWUDVWWR)LJXUH>$@ZKLFKLVOLPLWHGWRWKH)H+2V\VWHP)LJXUH>%@ ,QFRQWUDVWWR)LJXUH>$@ZKLFKLVOLPLWHGWRWKH)H+2V\VWHP)LJXUH>%@
DQG>&@UHSUHVHQWWKHWKHUPRG\QDPLFHIIHFWRIDGGLQJRWKHUPHWDOVWRWKHV\VWHP)LJ DQG>&@UHSUHVHQWWKHWKHUPRG\QDPLFHIIHFWRIDGGLQJRWKHUPHWDOVWRWKHV\VWHP)LJ
XUH>%@VKRZVWKHµ6,3'¶RIVWDELOLW\GRPDLQVRIVHOHFWHGVWDLQOHVVVWHHODOOR\R[ XUH>%@VKRZVWKHµ6,3'¶RIVWDELOLW\GRPDLQVRIVHOHFWHGVWDLQOHVVVWHHODOOR\R[
LGHV FI)LJXUHLQ6HFWLRQ RQWKH)H&O+2µ0(3'¶ FI)LJXUH>%@ LGHV FI)LJXUHLQ6HFWLRQ RQWKH)H&O+2µ0(3'¶ FI)LJXUH>%@
LQ 6HFWLRQ   DQG LV PHDQWWRUHSUHVHQWWKHFRPELQDWLRQ RI DQRWKHUPHWDO RU LQ6HFWLRQ DQGLVPHDQWWRUHSUHVHQWWKHFRPELQDWLRQ RI DQRWKHUPHWDO RU
HOHPHQW DQGLURQWRIRUPFRPSOH[HVZLWKLPSURYHGFRUURVLRQUHVLVWDQFHDV&U)H2 HOHPHQW DQGLURQWRIRUPFRPSOH[HVZLWKLPSURYHGFRUURVLRQUHVLVWDQFHDV&U)H2
LQWKLVLQVWDQFH)LJXUH>&@UHSUHVHQWVFRUURVLRQSURWHFWLRQRILURQE\DQRWKHU LQ LQWKLVLQVWDQFH)LJXUH>&@UHSUHVHQWVFRUURVLRQSURWHFWLRQRILURQE\DQRWKHU LQ
WKLV FDVH PRUH QREOH  PHWDO 7KH µ6,3'¶ RI WKH &X&O+2 µ0(3'¶ RQ WKH )H&O WKLV FDVH PRUH QREOH  PHWDO 7KH µ6,3'¶ RI WKH &X&O+2 µ0(3'¶ RQ WKH )H&O
+2µ0(3'¶ZKLFKLOOXVWUDWHVWKHWKHUPRG\QDPLFFRQGLWLRQVRIFRSSHUFODGGLQJLV +2µ0(3'¶ZKLFKLOOXVWUDWHVWKHWKHUPRG\QDPLFFRQGLWLRQVRIFRSSHUFODGGLQJLV
FKRVHQDVDQH[DPSOHIRUWKLVDSSURDFK FI)LJXUH>%@LQ6HFWLRQ  FKRVHQDVDQH[DPSOHIRUWKLVDSSURDFK FI)LJXUH>%@LQ6HFWLRQ 
+HQFH)LJXUHUHSUHVHQWVWKUHH LQWHUOLQNHG IXQGDPHQWDOGHVLJQRSWLRQVIRUFRXQ +HQFH)LJXUHUHSUHVHQWVWKUHH LQWHUOLQNHG IXQGDPHQWDOGHVLJQRSWLRQVIRUFRXQ
WHUPHDVXUHVWKDWDUHDYDLODEOHIURPDWKHUPRG\QDPLFSRLQWRIYLHZ WHUPHDVXUHVWKDWDUHDYDLODEOHIURPDWKHUPRG\QDPLFSRLQWRIYLHZ
$ &RQWURORIµ(FRUU¶LQWKH)H+2V\VWHP FI)LJXUH>$@  $ &RQWURORIµ(FRUU¶LQWKH)H+2V\VWHP FI)LJXUH>$@ 
% $GGLWLRQRIRWKHUPHWDOVRU HOHPHQWV WR WKH )H+2 V\VWHP IRUPLQJ R[LGHV ZLWK % $GGLWLRQRIRWKHUPHWDOVRU HOHPHQWV WR WKH )H+2V\VWHPIRUPLQJR[LGHVZLWK
LPSURYHGFRUURVLRQUHVLVWDQFH FI)LJXUH>%@  LPSURYHGFRUURVLRQUHVLVWDQFH FI)LJXUH>%@ 
& 3URWHFWLRQ RUUHSODFHPHQW RIWKH)H+2V\VWHPE\PHWDOVZLWKLPSURYHGFRUUR & 3URWHFWLRQ RUUHSODFHPHQW RIWKH)H+2V\VWHPE\PHWDOVZLWKLPSURYHGFRUUR
VLRQUHVLVWDQFH FI)LJXUH>&@  VLRQUHVLVWDQFH FI)LJXUH>&@ 
7ZR SULQFLSOHV RI LPSOHPHQWDWLRQ DUH HPSOR\HG LQ RXU SURSRVHG QHZ FRXQWHUPHD 7ZR SULQFLSOHV RI LPSOHPHQWDWLRQ DUH HPSOR\HG LQ RXU SURSRVHG QHZ FRXQWHUPHD
VXUHV FI 6HFWLRQ   7KH ILUVWSULQFLSOHRILPSOHPHQWDWLRQLVEDVHGRQDVXUIDFH VXUHV FI 6HFWLRQ   7KH ILUVWSULQFLSOHRILPSOHPHQWDWLRQLVEDVHGRQDVXUIDFH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 7KHRUHWLFDO'HVLJQ$SSURDFK 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 7KHRUHWLFDO'HVLJQ$SSURDFK

PRGLILFDWLRQ DQG FRPELQHV DOO WKUHH RI WKH DERYH OLVWHG WKHUPRG\QDPLF GHVLJQ RS PRGLILFDWLRQ DQG FRPELQHV DOO WKUHH RI WKH DERYH OLVWHG WKHUPRG\QDPLF GHVLJQ RS
WLRQVLH%XOOHWV$%DQG&(PEHGGHGHOHFWURGHVDUHXWLOLVHGIRUFRUURVLRQSURWHF WLRQVLH%XOOHWV$%DQG&(PEHGGHGHOHFWURGHVDUHXWLOLVHGIRUFRUURVLRQSURWHF
WLRQIRUWKHVHFRQGSULQFLSOHRILPSOHPHQWDWLRQLHWKLVSULQFLSOHVLVEDVHGRQWKHILUVW WLRQIRUWKHVHFRQGSULQFLSOHRILPSOHPHQWDWLRQLHWKLVSULQFLSOHVLVEDVHGRQWKHILUVW
RSWLRQ %XOOHW$ RQO\ RSWLRQ %XOOHW$ RQO\
:LWKUHJDUGWRWKHFRQWURORIµ(FRUU¶DQGS+LQWKH)H+2V\VWHP FIFDVHV & DQG :LWKUHJDUGWRWKHFRQWURORIµ(FRUU¶DQGS+LQWKH)H+2V\VWHP FIFDVHV & DQG
' LQ)LJXUH>$@DQG%XOOHW$LQWKHDERYHOLVW ERWKSULQFLSOHVRILPSOHPHQWD ' LQ)LJXUH>$@DQG%XOOHW$LQWKHDERYHOLVW ERWKSULQFLSOHVRILPSOHPHQWD
WLRQDLPDWDWDUJHWHGORZµ(FRUU¶ ,Q6HFWLRQRXUFRQFHUQVUHJDUGLQJDQRGLFSR WLRQDLPDWDWDUJHWHGORZµ(FRUU¶ ,Q6HFWLRQRXUFRQFHUQVUHJDUGLQJDQRGLFSR
ODULVDWLRQ IRU FKORULGH FRQWDPLQDWHG FRQFUHWH ZHUH LQGLFDWHG HJ FRQFHUQLQJ SLWWLQJ ODULVDWLRQ IRU FKORULGH FRQWDPLQDWHG FRQFUHWH ZHUH LQGLFDWHG HJ FRQFHUQLQJ SLWWLQJ
SRWHQWLDOV IRU LQLWLDWLRQ DQG WKH HIIHFWV RI SURGXFWV IRUPHG XQGHU KLJKHU µ(FRUU¶ LQ SRWHQWLDOV IRU LQLWLDWLRQ DQG WKH HIIHFWV RI SURGXFWV IRUPHG XQGHU KLJKHU µ(FRUU¶ LQ
SURSDJDWLRQRIFKORULGHLQGXFHGFRUURVLRQ FI6HFWLRQ :HFRQVLGHUDOOPHDV SURSDJDWLRQRIFKORULGHLQGXFHGFRUURVLRQ FI6HFWLRQ :HFRQVLGHUDOOPHDV
XUHVWKDWDLPDWDQRGLFSRODULVDWLRQ HJFRUURVLRQLQKLELWRUVFI6HFWLRQ RU XUHVWKDWDLPDWDQRGLFSRODULVDWLRQ HJFRUURVLRQLQKLELWRUVFI6HFWLRQ RU
PHDVXUHV WKDW FDQ OHDG WR XQLQWHQGHG DQRGLF SRODULVDWLRQ HJ QREOH FODGGLQJ FI PHDVXUHV WKDW FDQ OHDG WR XQLQWHQGHG DQRGLF SRODULVDWLRQ HJ QREOH FODGGLQJ FI
6HFWLRQ   DV D GDQJHURXVDSSURDFKWRZDUGVFRUURVLRQSURWHFWLRQLQWKHFKOR 6HFWLRQ DVDGDQJHURXVDSSURDFKWRZDUGVFRUURVLRQSURWHFWLRQLQWKHFKOR
ULGHHQYLURQPHQW ULGHHQYLURQPHQW
+RZHYHUIURP DWKHUPRG\QDPLFSHUVSHFWLYHDQRGLFSRODULVDWLRQFDQEHEHQHILFLDOO\ +RZHYHUIURP DWKHUPRG\QDPLFSHUVSHFWLYHDQRGLFSRODULVDWLRQFDQEHEHQHILFLDOO\
XWLOLVHGLQSUHYHQWLQJ RUFHDVLQJ FDUERQDWLRQLQGXFHGFRUURVLRQVHHFDVH ' LQ)LJ XWLOLVHGLQSUHYHQWLQJ RUFHDVLQJ FDUERQDWLRQLQGXFHGFRUURVLRQVHHFDVH ' LQ)LJ
XUH>$@,QWKLVFRQWH[WLWLVUHFRPPHQGHGLQHJ>3RXUEDL[D@WKDWDQ\UH XUH>$@,QWKLVFRQWH[WLWLVUHFRPPHQGHGLQHJ>3RXUEDL[D@WKDWDQ\UH
GXFLQJVXEVWDQFH VXOSKLGHVKXPLFPDWWHUVHWF VKRXOGEHDYRLGHGLQFRQFUHWH DQG GXFLQJVXEVWDQFH VXOSKLGHVKXPLFPDWWHUVHWF VKRXOGEHDYRLGHGLQFRQFUHWH DQG
XVHRIR[LGLVLQJFHPHQWVRUR[LGDQWVHJFKURPDWHVDQGQLWULWHV FI6HFWLRQ  XVHRIR[LGLVLQJFHPHQWVRUR[LGDQWVHJFKURPDWHVDQGQLWULWHV FI6HFWLRQ 
LV UHFRPPHQGHG WR IRUP D ³PRUH SURWHFWLYH´ SDVVLYH OD\HU 7KH SURWHFWLRQ DJDLQVW LV UHFRPPHQGHG WR IRUP D ³PRUH SURWHFWLYH´ SDVVLYH OD\HU 7KH SURWHFWLRQ DJDLQVW
FDUERQDWLRQLQGXFHGFRUURVLRQZLOOEHHQKDQFHGLI DQGRQO\LI WKHDQRGLFSRODULVD FDUERQDWLRQLQGXFHGFRUURVLRQZLOOEHHQKDQFHGLI DQGRQO\LI WKHDQRGLFSRODULVD
WLRQLVVXIILFLHQWWRPRYHµ(FRUU¶RXWRIWKHFULWLFDOUHJLRQ FI)LJXUH>$@ DQGWR WLRQLVVXIILFLHQWWRPRYHµ(FRUU¶RXWRIWKHFULWLFDOUHJLRQ FI)LJXUH>$@ DQGWR
DWWDLQ WKLV VWDWH GXULQJ WKH ZKROH GHVLJQ VHUYLFH OLIH RI WKHVWUXFWXUH +RZHYHU ZLWK DWWDLQ WKLV VWDWH GXULQJ WKH ZKROH GHVLJQ VHUYLFH OLIH RI WKHVWUXFWXUH +RZHYHU ZLWK
UHJDUGWRWKHPHQWLRQHGLVVXHVZLWKORQJWHUPSHUIRUPDQFH FIHVSHFLDOO\%XOOHWV UHJDUGWRWKHPHQWLRQHGLVVXHVZLWKORQJWHUPSHUIRUPDQFH FIHVSHFLDOO\%XOOHWV
DQGLQ6HFWLRQ ZHWKLQNWKDWWKLVLVDUDWKHULQWULFDWHWDVN DQGLQ6HFWLRQ ZHWKLQNWKDWWKLVLVDUDWKHULQWULFDWHWDVN
:KLOHKLJKVWUHQJWKVWHHOUHLQIRUFHPHQWUHTXLUHVVSHFLDOFRQVLGHUDWLRQV FI%XOOHW :KLOHKLJKVWUHQJWKVWHHOUHLQIRUFHPHQWUHTXLUHVVSHFLDOFRQVLGHUDWLRQV FI%XOOHW
LQ6HFWLRQ ZHVXJJHVWDGGUHVVLQJERWKFDUERQDWLRQDQGFKORULGHLQGXFHGFRUUR LQ6HFWLRQ ZHVXJJHVWDGGUHVVLQJERWKFDUERQDWLRQDQGFKORULGHLQGXFHGFRUUR
VLRQDVZHOODVFRPELQHGH[SRVXUHVLWXDWLRQVZLWKWKHHVWDEOLVKPHQWRIDWDUJHWHGORZ VLRQDVZHOODVFRPELQHGH[SRVXUHVLWXDWLRQVZLWKWKHHVWDEOLVKPHQWRIDWDUJHWHGORZ
µ(FRUU¶$VGLVFXVVHGLQGHWDLOLQ6HFWLRQZHWKLQNWKDWORZHULQJµ(FRUU¶DWKLJK µ(FRUU¶$VGLVFXVVHGLQGHWDLOLQ6HFWLRQZHWKLQNWKDWORZHULQJµ(FRUU¶DWKLJK
S+LQWRWKHGRPDLQRI+)H2íLHORZSRWHQWLDOFRUURVLRQGRHVQRWOHDGWRSUREOHPV S+LQWRWKHGRPDLQRI+)H2íLHORZSRWHQWLDOFRUURVLRQGRHVQRWOHDGWRSUREOHPV
IRUFDUERQVWHHOUHLQIRUFHPHQW IRUFDUERQVWHHOUHLQIRUFHPHQW

 .LQHWLF'HVLJQ$SSURDFK  .LQHWLF'HVLJQ$SSURDFK


$VPHQWLRQHGLQ6HFWLRQZHFRQVLGHUNLQHWLFDSSURDFKHVWR UHODWHWRFRQFUHWH $VPHQWLRQHGLQ6HFWLRQZHFRQVLGHUNLQHWLFDSSURDFKHVWR UHODWHWRFRQFUHWH
FRXQWHUPHDVXUHVUDWKHUWKDQWRUHLQIRUFHPHQWFRXQWHUPHDVXUHV+RZHYHULWVKRXOGEH FRXQWHUPHDVXUHVUDWKHUWKDQWRUHLQIRUFHPHQWFRXQWHUPHDVXUHV+RZHYHULWVKRXOGEH
QRWHGWKDWNLQHWLFPHDVXUHVDOVRKDYHDVLJQLILFDQWHIIHFWRQWKHWKHUPRG\QDPLFFRQ QRWHGWKDWNLQHWLFPHDVXUHVDOVRKDYHDVLJQLILFDQWHIIHFWRQWKHWKHUPRG\QDPLFFRQ
 

7KHH[SUHVVLRQ³ORZµ(FRUU¶´LVXVHGLQVWHDGRIFDWKRGLFSURWHFWLRQSUHYHQWLRQZKHQUHIHUULQJWRERWK 7KHH[SUHVVLRQ³ORZµ(FRUU¶´LVXVHGLQVWHDGRIFDWKRGLFSURWHFWLRQSUHYHQWLRQZKHQUHIHUULQJWRERWK
SULQFLSOHVRILPSOHPHQWDWLRQ RUWRWKHILUVWSULQFLSOHRILPSOHPHQWDWLRQ VLQFHWKHFDUERQVWHHOVXU SULQFLSOHVRILPSOHPHQWDWLRQ RUWRWKHILUVWSULQFLSOHRILPSOHPHQWDWLRQ VLQFHWKHFDUERQVWHHOVXU
IDFHWUHDWPHQWRSHUDWHVDWORZSRWHQWLDOVE\LWVHOIDQGRQO\SURYLGHVFDWKRGLFSURWHFWLRQDWHJGLV IDFHWUHDWPHQWRSHUDWHVDWORZSRWHQWLDOVE\LWVHOIDQGRQO\SURYLGHVFDWKRGLFSURWHFWLRQDWHJGLV
FRQWLQXLWLHV FRQWLQXLWLHV

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7KHRUHWLFDO'HVLJQ$SSURDFK 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 7KHRUHWLFDO'HVLJQ$SSURDFK 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV

GLWLRQ RI D PHWDOOLF UHEDU HPEHGGHG LQ FRQFUHWH )RU LQVWDQFHLQFUHDVLQJ WKH GHQVH GLWLRQ RI D PHWDOOLF UHEDU HPEHGGHG LQ FRQFUHWH )RU LQVWDQFHLQFUHDVLQJ WKH GHQVH
QHVVRUGHJUHHRIVDWXUDWLRQRIWKHFRQFUHWHOLPLWVWKHR[\JHQVXSSO\DQGKHQFHORZHUV QHVVRUGHJUHHRIVDWXUDWLRQRIWKHFRQFUHWHOLPLWVWKHR[\JHQVXSSO\DQGKHQFHORZHUV
µ(FRUU¶ FI6HFWLRQVDQG $WWKHVDPHWLPHWKHWKHUPRG\QDPLFFRQGLWLRQ µ(FRUU¶ FI6HFWLRQVDQG $WWKHVDPHWLPHWKHWKHUPRG\QDPLFFRQGLWLRQ
RIWKHUHEDULQIOXHQFHVWKHPLJUDWLRQRILRQV FI6HFWLRQVDQG  RIWKHUHEDULQIOXHQFHVWKHPLJUDWLRQRILRQV FI6HFWLRQVDQG 
%RWK WKH LQLWLDWLRQ DQG WKH SURSDJDWLRQ VWDJH DUH ODUJHO\ LQIOXHQFHG E\ WKH NLQHWLF %RWK WKH LQLWLDWLRQ DQG WKH SURSDJDWLRQ VWDJH DUH ODUJHO\ LQIOXHQFHG E\ WKH NLQHWLF
SURSHUWLHVRIWKHFRQFUHWHEXONDQGWKHFRQFUHWHVWHHOLQWHUIDFH)RULQVWDQFHLQDGGL SURSHUWLHVRIWKHFRQFUHWHEXONDQGWKHFRQFUHWHVWHHOLQWHUIDFH)RULQVWDQFHLQDGGL
WLRQ WR FRQWUROOLQJ WKH LQLWLDWLRQ SKDVH LQ WHUPV RI FKORULGH LQJUHVV DQG FDUERQDWLRQ WLRQ WR FRQWUROOLQJ WKH LQLWLDWLRQ SKDVH LQ WHUPV RI FKORULGH LQJUHVV DQG FDUERQDWLRQ
WKHSURSHUWLHVRIWKHFRQFUHWHFRQWUROWKHVXSSO\RIR[\JHQDQGWKHLRQPRELOLW\DQG WKHSURSHUWLHVRIWKHFRQFUHWHFRQWUROWKHVXSSO\RIR[\JHQDQGWKHLRQPRELOLW\DQG
WKXVSURSDJDWLRQLQWHUPVRIWKHFRUURVLRQUDWH6RLQFRQWLQXDWLRQRIWKHOLVWRIWKHU WKXVSURSDJDWLRQLQWHUPVRIWKHFRUURVLRQUDWH6RLQFRQWLQXDWLRQRIWKHOLVWRIWKHU
PRG\QDPLFRSWLRQVLQ6HFWLRQWKHIROORZLQJWKUHHIXQGDPHQWDOGHVLJQRSWLRQV PRG\QDPLFRSWLRQVLQ6HFWLRQWKHIROORZLQJWKUHHIXQGDPHQWDOGHVLJQRSWLRQV
DUHDYDLODEOHIURPDNLQHWLFSHUVSHFWLYH DUHDYDLODEOHIURPDNLQHWLFSHUVSHFWLYH
' ,PSURYHPHQWRIWKHGHQVHQHVVRIWKHFRQFUHWH ' ,PSURYHPHQWRIWKHGHQVHQHVVRIWKHFRQFUHWH
( &RQFUHWHVXUIDFHSURWHFWLRQ ( &RQFUHWHVXUIDFHSURWHFWLRQ
) ,PSURYHPHQWRIWKHFRQFUHWHVWHHOLQWHUIDFH ) ,PSURYHPHQWRIWKHFRQFUHWHVWHHOLQWHUIDFH
,Q6HFWLRQLWZDVSRLQWHGRXWWKDWDOOWHFKQLTXHVDLPLQJDWLPSURYLQJWKHGHQVHQHVV ,Q6HFWLRQLWZDVSRLQWHGRXWWKDWDOOWHFKQLTXHVDLPLQJDWLPSURYLQJWKHGHQVHQHVV
RIWKHFRQFUHWH %XOOHW' LQWHUIHUHZLWKSUDFWLFDELOLW\ FI%XOOHWVDQG DQGWKDW RIWKHFRQFUHWH %XOOHW' LQWHUIHUHZLWKSUDFWLFDELOLW\ FI%XOOHWVDQG DQGWKDW
µ+3&¶PD\DOVROHDGWRDQLQFUHDVHGULVNIRUHDUO\DJHFUDFNLQJ FI%XOOHW 3UDF µ+3&¶PD\DOVROHDGWRDQLQFUHDVHGULVNIRUHDUO\DJHFUDFNLQJ FI%XOOHW 3UDF
WLFDELOLW\GLVDGYDQWDJHV FI%XOOHWVWR DOVRDSSO\WRFRQFUHWHVXUIDFHSURWHF WLFDELOLW\GLVDGYDQWDJHV FI%XOOHWVWR DOVRDSSO\WRFRQFUHWHVXUIDFHSURWHF
WLRQ %XOOHW( ZKLFKIXUWKHU UDLVHG FRQFHUQV ZLWKUHJDUGWRORQJWHUPSHUIRUPDQFH WLRQ %XOOHW( ZKLFKIXUWKHU UDLVHG FRQFHUQV ZLWKUHJDUGWRORQJWHUPSHUIRUPDQFH
DQGVHQVLWLYLW\WRH[SRVXUHFRQGLWLRQV %XOOHWVDQG  DQGVHQVLWLYLW\WRH[SRVXUHFRQGLWLRQV %XOOHWVDQG 
,QWHUPVRIWKHDYDLODEOHFRXQWHUPHDVXUHV FI6HFWLRQ FRQFUHWHVWHHOLQWHUIDFHLP ,QWHUPVRIWKHDYDLODEOHFRXQWHUPHDVXUHV FI6HFWLRQ FRQFUHWHVWHHOLQWHUIDFHLP
SURYHPHQW %XOOHW) ZDVFRYHUHGE\LPSUHVVHGFXUUHQWLQWHUIDFHLPSURYHPHQW7KLV SURYHPHQW %XOOHW) ZDVFRYHUHGE\LPSUHVVHGFXUUHQWLQWHUIDFHLPSURYHPHQW7KLV
WHFKQLTXH GRHV QRW PHHW RXU SUDFWLFDELOLW\ UHTXLUHPHQWV FI %XOOHWV  DQG  LQ WHFKQLTXH GRHV QRW PHHW RXU SUDFWLFDELOLW\ UHTXLUHPHQWV FI %XOOHWV  DQG  LQ
6HFWLRQ +RZHYHUZHWKLQNWKDWWKHUHDUHRWKHUIHDVLEOHRSWLRQVRILPSURYLQJWKH 6HFWLRQ +RZHYHUZHWKLQNWKDWWKHUHDUHRWKHUIHDVLEOHRSWLRQVRILPSURYLQJWKH
FRQFUHWHVWHHOLQWHUIDFHLHE\VHOIVXVWDLQLQJGHQVLILFDWLRQSURFHVVHVZLWKRXWDSSOLFD FRQFUHWHVWHHOLQWHUIDFHLHE\VHOIVXVWDLQLQJGHQVLILFDWLRQSURFHVVHVZLWKRXWDSSOLFD
WLRQ RI DQ LPSUHVVHG FXUUHQW :H VXJJHVW WKDW WKLV DSSURDFK LQ FRPELQDWLRQ ZLWK D WLRQ RI DQ LPSUHVVHG FXUUHQW :H VXJJHVW WKDW WKLV DSSURDFK LQ FRPELQDWLRQ ZLWK D
ZRUNDEOHFRQFUHWHRIDUHDVRQDEOHTXDOLW\ZLOOVLJQLILFDQWO\LPSURYHWKHFRQFUHWHVWHHO ZRUNDEOHFRQFUHWHRIDUHDVRQDEOHTXDOLW\ZLOOVLJQLILFDQWO\LPSURYHWKHFRQFUHWHVWHHO
LQWHUIDFH FI6HFWLRQ  LQWHUIDFH FI6HFWLRQ 

 3ULQFLSOHVRI,PSOHPHQWDWLRQ  3ULQFLSOHVRI,PSOHPHQWDWLRQ


$V PHQWLRQHG LQ 6HFWLRQV  DQG  WZR GLYHUVH SULQFLSOHV RI LPSOHPHQWDWLRQ $V PHQWLRQHG LQ 6HFWLRQV  DQG  WZR GLYHUVH SULQFLSOHV RI LPSOHPHQWDWLRQ
IRU FRUURVLRQ SURWHFWLRQ ZKLFK ERWK UHODWH WR WKH XVH RI RUGLQDU\ FDUERQ VWHHO UHLQ IRU FRUURVLRQ SURWHFWLRQ ZKLFK ERWK UHODWH WR WKH XVH RI RUGLQDU\ FDUERQ VWHHO UHLQ
IRUFHPHQW KDYH EHHQ GHULYHG EDVHG RQ WKH UHTXLUHPHQWV VWDWHG LQ 6HFWLRQ  7KH IRUFHPHQW KDYH EHHQ GHULYHG EDVHG RQ WKH UHTXLUHPHQWV VWDWHG LQ 6HFWLRQ  7KH
ILUVW SULQFLSOH RI LPSOHPHQWDWLRQ KHQFHIRUWK µ3ULQFLSOH ,¶  LV EDVHG RQ D VXUIDFH ILUVW SULQFLSOH RI LPSOHPHQWDWLRQ KHQFHIRUWK µ3ULQFLSOH ,¶  LV EDVHG RQ D VXUIDFH
PRGLILFDWLRQ RI WKH UHLQIRUFHPHQW ZKHUHDV WKH VHFRQG SULQFLSOH RI LPSOHPHQWDWLRQ PRGLILFDWLRQ RI WKH UHLQIRUFHPHQW ZKHUHDV WKH VHFRQG SULQFLSOH RI LPSOHPHQWDWLRQ
KHQFHIRUWKµ3ULQFLSOH ,,¶ LVEDVHGRQWKH DSSOLFDWLRQRIHPEHGGHGHOHFWURGHV%RWK KHQFHIRUWKµ3ULQFLSOH ,,¶ LVEDVHGRQWKH DSSOLFDWLRQRIHPEHGGHGHOHFWURGHV%RWK
SULQFLSOHV IROORZ WKH SULQFLSDO DLP RI DWWDLQLQJ WDUJHWHG ORZ FRUURVLRQ SRWHQWLDOV SULQFLSOHV IROORZ WKH SULQFLSDO DLP RI DWWDLQLQJ WDUJHWHG ORZ FRUURVLRQ SRWHQWLDOV
ZKLFK LV DFKLHYHGE\ PHDQV RI WKHPDWHULDOVFRQFHSWVGHVFULEHGLQ6HFWLRQ7KH ZKLFK LV DFKLHYHGE\ PHDQV RI WKHPDWHULDOVFRQFHSWVGHVFULEHGLQ6HFWLRQ7KH
PDWHULDOVFRQFHSWRIµ3ULQFLSOH,¶DOVRHQDEOHVGHQVLILFDWLRQRIWKHFRQFUHWHVWHHOLQWHU PDWHULDOVFRQFHSWRIµ3ULQFLSOH,¶DOVRHQDEOHVGHQVLILFDWLRQRIWKHFRQFUHWHVWHHOLQWHU

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV

IDFH,QWHUIDFHGHQVLILFDWLRQLVLPPRELOLVHGLQWKHPDWHULDOVFRQFHSWRIµ3ULQFLSOH,,¶ IDFH,QWHUIDFHGHQVLILFDWLRQLVLPPRELOLVHGLQWKHPDWHULDOVFRQFHSWRIµ3ULQFLSOH,,¶
DVFDWKRGLFSURWHFWLRQZLWKDKLJKFXUUHQW\LHOGLVDLPHGDW DVFDWKRGLFSURWHFWLRQZLWKDKLJKFXUUHQW\LHOGLVDLPHGDW
7KH FRQFUHWHVWHHO LQWHUIDFH LPSURYHPHQW RI µ3ULQFLSOH ,¶ LV DFKLHYHG E\ HOHFWUR 7KH FRQFUHWHVWHHO LQWHUIDFH LPSURYHPHQW RI µ3ULQFLSOH ,¶ LV DFKLHYHG E\ HOHFWUR
FKHPLFDO GHQVLILFDWLRQ GXULQJ WKH VHW RI FRQFUHWH DV ZHOO E\ SRUHEORFNLQJ DW ODWHU FKHPLFDO GHQVLILFDWLRQ GXULQJ WKH VHW RI FRQFUHWH DV ZHOO E\ SRUHEORFNLQJ DW ODWHU
VWDJHV:KLOHWKHFRQFHSWVGLIIHUWKHUHVXOWVDFKLHYHGDUHDVVXPHGWREHFRPSDUDEOH VWDJHV:KLOHWKHFRQFHSWVGLIIHUWKHUHVXOWVDFKLHYHGDUHDVVXPHGWREHFRPSDUDEOH
WR HOHFWURFKHPLFDO GHQVLILFDWLRQ E\ LPSUHVVHG FXUUHQWV FI 6HFWLRQ   DQG IRU WR HOHFWURFKHPLFDO GHQVLILFDWLRQ E\ LPSUHVVHG FXUUHQWV FI 6HFWLRQ   DQG IRU
PDWLRQ RI SRUHEORFNHUV FI 6HFWLRQ   ,Q WKLV ZD\ D WDLORUHG GHQVH FRQFUHWH PDWLRQ RI SRUHEORFNHUV FI 6HFWLRQ   ,Q WKLV ZD\ D WDLORUHG GHQVH FRQFUHWH
VWHHOLQWHUIDFH LV REWDLQHG ZKLFK LV H[SHFWHG WR VLJQLILFDQWO\ LQFUHDVH WKH FKORULGH VWHHOLQWHUIDFH LV REWDLQHG ZKLFK LV H[SHFWHG WR VLJQLILFDQWO\ LQFUHDVH WKH FKORULGH
WKUHVKROG FI 6HFWLRQV   7KH GHQVLILHG FRQFUHWHVWHHO LQWHUIDFH GRHV QRW RQO\ WKUHVKROG FI 6HFWLRQV   7KH GHQVLILHG FRQFUHWHVWHHO LQWHUIDFH GRHV QRW RQO\
OLPLWWKHDFFHVVWRFKORULGHLRQVDQGR[\JHQEXWLWDOVRGHFUHDVHVWKHRYHUDOOLRQPR OLPLWWKHDFFHVVWRFKORULGHLRQVDQGR[\JHQEXWLWDOVRGHFUHDVHVWKHRYHUDOOLRQPR
ELOLW\ FI6HFWLRQ 7KLVOLPLWVWKHIRUPDWLRQRIPLFURFHOOV FI6HFWLRQ  ELOLW\ FI6HFWLRQ 7KLVOLPLWVWKHIRUPDWLRQRIPLFURFHOOV FI6HFWLRQ 
DQGPDFURFHOOV FI6HFWLRQ DQGIXUWKHUPRUHFRXQWHUDFWVRXWZDUGVGLIIXVLRQRI DQGPDFURFHOOV FI6HFWLRQ DQGIXUWKHUPRUHFRXQWHUDFWVRXWZDUGVGLIIXVLRQRI
VROXEOHFRUURVLRQSURGXFWV FI6HFWLRQ 7KXVEDVHGRQWKLVNLQHWLFDSSURDFK VROXEOHFRUURVLRQSURGXFWV FI6HFWLRQ 7KXVEDVHGRQWKLVNLQHWLFDSSURDFK
WKHEXONGHQVHQHVVLVLPSURYHGZKHUHLWLVHVVHQWLDOLHZKHUHWKHFRUURVLRQUHDFWLRQV WKHEXONGHQVHQHVVLVLPSURYHGZKHUHLWLVHVVHQWLDOLHZKHUHWKHFRUURVLRQUHDFWLRQV
WDNHSODFH,QFRQWUDVWWRµ+3&¶SRVVLEOHSUREOHPVUHODWHGWRH[HFXWLRQDQGFXULQJDUH WDNHSODFH,QFRQWUDVWWRµ+3&¶SRVVLEOHSUREOHPVUHODWHGWRH[HFXWLRQDQGFXULQJDUH
DYRLGHGDQGLQFRQWUDVWWRFRQFUHWHVXUIDFHSURWHFWLRQWKHFRQFUHWHEXONLWVHOIJUDQWV DYRLGHGDQGLQFRQWUDVWWRFRQFUHWHVXUIDFHSURWHFWLRQWKHFRQFUHWHEXONLWVHOIJUDQWV
SURWHFWLRQ WR WKH HPEHGGHG EDUULHU 7KXV WKH V\VWHP GRHV QRW VWDWH VSHFLDO UHTXLUH SURWHFWLRQ WR WKH HPEHGGHG EDUULHU 7KXV WKH V\VWHP GRHV QRW VWDWH VSHFLDO UHTXLUH
PHQWVWRPDWHULDOV FRQFUHWH DQGH[HFXWLRQDQGLWLVPDLQWHQDQFHIUHH PHQWVWRPDWHULDOV FRQFUHWH DQGH[HFXWLRQDQGLWLVPDLQWHQDQFHIUHH
%RWKµ3ULQFLSOH ,¶DQGµ3ULQFLSOH ,,¶ DUHH[SHFWHGWRVLJQLILFDQWO\LPSURYHWKHFRUUR %RWKµ3ULQFLSOH ,¶DQGµ3ULQFLSOH ,,¶ DUHH[SHFWHGWRVLJQLILFDQWO\ LPSURYH WKHFRUUR
VLRQ SURWHFWLRQ RI FDUERQ VWHHO UHLQIRUFHPHQW LQ FRQWDPLQDWHG DQG FUDFNHG XS WR D VLRQ SURWHFWLRQ RI FDUERQ VWHHO UHLQIRUFHPHQW LQ FRQWDPLQDWHG DQG FUDFNHG XS WR D
FHUWDLQFUDFNZLGWK FRQFUHWH&RXQWHUPHDVXUHVEDVHGRQFRPELQLQJµ3ULQFLSOH,¶DQG FHUWDLQFUDFNZLGWK FRQFUHWH&RXQWHUPHDVXUHVEDVHGRQFRPELQLQJµ3ULQFLSOH,¶DQG
µ3ULQFLSOH,,¶DUHDOVRSRVVLEOHZKLFKZLOOEHIXUWKHUHODERUDWHGLQ6HFWLRQ µ3ULQFLSOH,,¶DUHDOVRSRVVLEOHZKLFKZLOOEHIXUWKHUHODERUDWHGLQ6HFWLRQ
7KHSULQFLSOHVRILPSOHPHQWDWLRQDUHDSSOLFDEOHIRUERWKQHZDQGH[LVWLQJVWUXFWXUHV 7KHSULQFLSOHVRILPSOHPHQWDWLRQDUHDSSOLFDEOHIRUERWKQHZDQGH[LVWLQJVWUXFWXUHV
,WVKRXOGEHQRWHGWKDWWKHLPSOHPHQWDWLRQSURFHVVHVIRUµ3ULQFLSOH,¶GLIIHUFRQVLGHUD ,WVKRXOGEHQRWHGWKDWWKHLPSOHPHQWDWLRQSURFHVVHVIRUµ3ULQFLSOH,¶GLIIHUFRQVLGHUD
EO\EHWZHHQDSSOLFDWLRQLQQHZDQGH[LVWLQJVWUXFWXUHV7KLVDQGRWKHUDVSHFWVRIWKH EO\EHWZHHQDSSOLFDWLRQLQQHZDQGH[LVWLQJVWUXFWXUHV7KLVDQGRWKHUDVSHFWVRIWKH
SURGXFWLRQDQGLPSOHPHQWDWLRQDUHGLVFXVVHGLQ6HFWLRQ SURGXFWLRQDQGLPSOHPHQWDWLRQDUHGLVFXVVHGLQ6HFWLRQ

 0DWHULDOV&RQFHSWV  0DWHULDOV&RQFHSWV


,QWKLV6HFWLRQWKHPDWHULDOVFRQFHSWVIRUWKHSURGXFWLRQDQGLPSOHPHQWDWLRQLHWKH ,QWKLV6HFWLRQWKHPDWHULDOVFRQFHSWVIRUWKHSURGXFWLRQDQGLPSOHPHQWDWLRQLHWKH
EDVLVIRUWKHSUDFWLFDODSSURDFKHVWRUHDOLVHWKHWKHRUHWLFDOFRQFHSWV FI6HFWLRQ  EDVLVIRUWKHSUDFWLFDODSSURDFKHVWRUHDOLVHWKHWKHRUHWLFDOFRQFHSWV FI6HFWLRQ 
DUHVXPPDULVHGIRUERWKSULQFLSOHVRILPSOHPHQWDWLRQ FI6HFWLRQ  DUHVXPPDULVHGIRUERWKSULQFLSOHVRILPSOHPHQWDWLRQ FI6HFWLRQ 
%RWK SULQFLSOHV RI LPSOHPHQWDWLRQ DUH EDVHG RQ LPSOHPHQWLQJ FHUWDLQ SRUWLRQV RI %RWK SULQFLSOHV RI LPSOHPHQWDWLRQ DUH EDVHG RQ LPSOHPHQWLQJ FHUWDLQ SRUWLRQV RI
PDJQHVLXPDQG]LQFLQWKH)H+2V\VWHPE\FXVWRPGHVLJQHGSURFHVVHVWKDWSURYLGH PDJQHVLXPDQG]LQFLQWKH)H+2V\VWHPE\FXVWRPGHVLJQHGSURFHVVHVWKDWSURYLGH
IRUVWDELOLW\LQWKHFRQFUHWHHQYLURQPHQWDOVRLQFDVHRIFDUERQDWLRQDQGFKORULGHFRQ IRUVWDELOLW\LQWKHFRQFUHWHHQYLURQPHQWDOVRLQFDVHRIFDUERQDWLRQDQGFKORULGHFRQ
WDPLQDWLRQ 7KH EDFNJURXQG DV ZHOO DV WKH WKHUPRG\QDPLFV RI LQWURGXFLQJ ]LQF DQG WDPLQDWLRQ 7KH EDFNJURXQG DV ZHOO DV WKH WKHUPRG\QDPLFV RI LQWURGXFLQJ ]LQF DQG
PDJQHVLXP WR WKH FRQFUHWHVWHHO V\VWHP LV GHVFULEHG LQ 6HFWLRQV  DQG  UH PDJQHVLXP WR WKH FRQFUHWHVWHHO V\VWHP LV GHVFULEHG LQ 6HFWLRQV  DQG  UH
VSHFWLYHO\ VSHFWLYHO\

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV

 =LQFDQG&RQFUHWH6WHHO6\VWHP  =LQFDQG&RQFUHWH6WHHO6\VWHP


%HIRUHWKHDSSOLFDWLRQRI]LQFLQRXUSURSRVHGQHZFRXQWHUPHDVXUHVLVUHDVRQHGVRPH %HIRUHWKHDSSOLFDWLRQRI]LQFLQRXUSURSRVHGQHZFRXQWHUPHDVXUHVLVUHDVRQHGVRPH
JHQHUDO WKHUPRG\QDPLF DVSHFWV RI ]LQF DUH HODERUDWHG LQ FRQWLQXDWLRQ RI 6HFWLRQ JHQHUDO WKHUPRG\QDPLF DVSHFWV RI ]LQF DUH HODERUDWHG LQ FRQWLQXDWLRQ RI 6HFWLRQ
)LJXUHSUHVHQWV=Q+2µ6(3'V¶IRUGLIIHUHQW]LQFLRQDFWLYLWLHV )LJXUHSUHVHQWV=Q+2µ6(3'V¶IRUGLIIHUHQW]LQFLRQDFWLYLWLHV

 
)LJXUH =Q+2µ6(3'V¶EDVHGRQ7DEOHZLWKGLIIHUHQW]LQFLRQDFWLYLWLHV )LJXUH =Q+2µ6(3'V¶EDVHGRQ7DEOHZLWKGLIIHUHQW]LQFLRQDFWLYLWLHV
>$@=QLD íPRO/>%@=QLD íPRO/>&@=QLD PRO/ >$@=QLD íPRO/>%@=QLD íPRO/>&@=QLD PRO/
 

7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ6(3'¶RIWKH=Q+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ6(3'¶RIWKH=Q+2V\VWHP

6ROLG =Q =Q 2+   6ROLG =Q =Q 2+  


í  í í 
6ROXEOH +=Q2  =Q  =Q2  6ROXEOH +=Q2  =Q  =Q2í
 
%DVHGRQRXUSURSRVHGDSSURDFKWRZDUGVSUHVHOHFWLRQRIVSHFLHV FI6HFWLRQ RI %DVHGRQRXUSURSRVHGDSSURDFKWRZDUGVSUHVHOHFWLRQRIVSHFLHV FI6HFWLRQ RI
DOO R[LGHV DQG K\GUR[LGHV RI ]LQF H[LVWLQJ LQ DTXHRXV VROXWLRQ RQO\ WKH PRVW VWDEOH DOO R[LGHV DQG K\GUR[LGHV RI ]LQF H[LVWLQJ LQ DTXHRXV VROXWLRQ RQO\ WKH PRVW VWDEOH
IRUPLH]LQFK\GUR[LGH =Q 2+  LVFRQVLGHUHGDVSDVVLYHFRPSRXQG]LQFLRQEL] IRUPLH]LQFK\GUR[LGH =Q 2+  LVFRQVLGHUHGDVSDVVLYHFRPSRXQG]LQFLRQEL]
LQFDWHLRQ +=Q2í DQG]LQFDWHLRQ =Q2í DUHWKHVHOHFWHGVROXEOHFRPSRXQGVVHH LQFDWHLRQ +=Q2í DQG]LQFDWHLRQ =Q2í DUHWKHVHOHFWHGVROXEOHFRPSRXQGVVHH
7DEOH 7DEOH
)LJXUH  >$@ VKRZV WKDW ]LQF LV WKHUPRG\QDPLFDOO\ XQVWDEOH LH QRW LPPXQH LQ )LJXUH  >$@ VKRZV WKDW ]LQF LV WKHUPRG\QDPLFDOO\ XQVWDEOH LH QRW LPPXQH LQ
DTXHRXVVROXWLRQVDQGWHQGVWRGLVVROYHZLWKWKHHYROXWLRQRIK\GURJHQLQDFLGQHX DTXHRXVVROXWLRQVDQGWHQGVWRGLVVROYHZLWKWKHHYROXWLRQRIK\GURJHQLQDFLGQHX
WUDODQGYHU\DONDOLQHVROXWLRQV%DVHGRQWKHDVVXPHG ORZHUERXQG LRQDFWLYLW\IRU WUDODQGYHU\DONDOLQHVROXWLRQV%DVHGRQWKHDVVXPHG ORZHUERXQG LRQDFWLYLW\IRU
SDVVLYDWLRQLHíPRO/ FI6HFWLRQ ]LQFRQO\SDVVLYDWHVLQDUDWKHUQDUURZ SDVVLYDWLRQLHíPRO/ FI6HFWLRQ ]LQFRQO\SDVVLYDWHVLQDUDWKHUQDUURZ
S+UDQJHRIDSSUR[LPDWHO\ FI)LJXUH>$@ 7KHGLVVROXWLRQLVFRQVLGHUHGWR S+UDQJHRIDSSUR[LPDWHO\ FI)LJXUH>$@ 7KHGLVVROXWLRQLVFRQVLGHUHGWR
EHPRVWVHYHUHEHORZS+ DQG DERYHS+><HRPDQV@+RZHYHULI]LQFLV EHPRVWVHYHUHEHORZS+ DQG DERYHS+><HRPDQV@+RZHYHULI]LQFLV
QRWJDOYDQLFDOO\FRQQHFWHGWRDPHWDOZLWKORZK\GURJHQRYHUSRWHQWLDOWKHGLVVROXWLRQ QRWJDOYDQLFDOO\FRQQHFWHGWRDPHWDOZLWKORZK\GURJHQRYHUSRWHQWLDOWKHGLVVROXWLRQ
SURFHVVJHQHUDOO\WDNHVSODFHDWDORZUDWHGXHWRWKHODUJHK\GURJHQRYHUSRWHQWLDORI SURFHVVJHQHUDOO\WDNHVSODFHDWDORZUDWHGXHWRWKHODUJHK\GURJHQRYHUSRWHQWLDORI
]LQF>3RXUEDL[E=KDQJ@ ]LQF>3RXUEDL[E=KDQJ@
,Q)LJXUH>%@DQG>&@LWFDQEHREVHUYHGWKDWWKHSDVVLYDWLRQGRPDLQRI]LQFH[ ,Q)LJXUH>%@DQG>&@LWFDQEHREVHUYHGWKDWWKHSDVVLYDWLRQGRPDLQRI]LQFH[
WHQGVLQERWKGLUHFWLRQZLWKLQFUHDVLQJLRQDFWLYLW\7RZDUGVKLJKHUS+YDOXHVWKHH[ WHQGVLQERWKGLUHFWLRQZLWKLQFUHDVLQJLRQDFWLYLW\7RZDUGVKLJKHUS+YDOXHVWKHH[
WHQVLRQILUVWO\WDNHVSODFHRQH[SHQVHRIEL]LQFDWHLRQDQGZLWKIXUWKHULQFUHPHQWDOVR WHQVLRQILUVWO\WDNHVSODFHRQH[SHQVHRIEL]LQFDWHLRQDQGZLWKIXUWKHULQFUHPHQWDOVR
RI]LQFDWHLRQ:HVXJJHVWWKDWWKHHVWLPDWHG—PORVVRIWKHSXUH]LQFOD\HURQ RI]LQFDWHLRQ:HVXJJHVWWKDWWKHHVWLPDWHG—PORVVRIWKHSXUH]LQFOD\HURQ
JDOYDQLVHG UHEDU SULRU WR SDVVLYDWLRQ FI 6HFWLRQ   LV UHTXLUHG WR LQFUHDVH WKH JDOYDQLVHG UHEDU SULRU WR SDVVLYDWLRQ FI 6HFWLRQ   LV UHTXLUHG WR LQFUHDVH WKH
LRQDFWLYLW\LQWKHYLFLQLW\RIWKHUHEDUWRIDYRXUIRUPDWLRQRI=Q 2+ 7KXVLWFDQEH LRQDFWLYLW\LQWKHYLFLQLW\RIWKHUHEDUWRIDYRXUIRUPDWLRQRI=Q 2+ 7KXVLWFDQEH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV

FRQFOXGHGWKDW]LQFLVQRWRQO\XQVWDEOHLQWKHFRQFUHWHHQYLURQPHQWEXWDOVRLQLWLDOO\ FRQFOXGHGWKDW]LQFLVQRWRQO\XQVWDEOHLQWKHFRQFUHWHHQYLURQPHQWEXWDOVRLQLWLDOO\
DFWLYH DFWLYH
1HYHUWKHOHVVRQFH]LQFSDVVLYDWHVZLWKIRUPDWLRQRIFDOFLXPK\GUR[\]LQFDWH FI6HF 1HYHUWKHOHVVRQFH]LQFSDVVLYDWHVZLWKIRUPDWLRQRIFDOFLXPK\GUR[\]LQFDWH FI6HF
WLRQ ZHWKLQNWKDWLWSURYLGHVEHQHILFLDOFRUURVLRQSURWHFWLRQIRUFHUWDLQ DS WLRQ ZHWKLQNWKDWLWSURYLGHVEHQHILFLDOFRUURVLRQSURWHFWLRQIRUFHUWDLQ DS
SOLFDWLRQV7KHUPRG\QDPLFGDWDRIFDOFLXPK\GUR[\]LQFDWHKDVQRWEHHQIRXQGDYDLO SOLFDWLRQV7KHUPRG\QDPLFGDWDRIFDOFLXPK\GUR[\]LQFDWHKDVQRWEHHQIRXQGDYDLO
DEOHEXWZHDVVXPHWKDWDGGLWLRQRIFDOFLXPWRWKH=Q+2V\VWHPZLOOLQFUHDVHWKH DEOHEXWZHDVVXPHWKDWDGGLWLRQRIFDOFLXPWRWKH=Q+2V\VWHPZLOOLQFUHDVHWKH
H[WHQWRIWKHSDVVLYHGRPDLQ:HFRQVLGHUWKHHIIHFWRIFDOFLXPRQWKHH[WHQWRIWKH H[WHQWRIWKHSDVVLYHGRPDLQ:HFRQVLGHUWKHHIIHFWRIFDOFLXPRQWKHH[WHQWRIWKH
SDVVLYHGRPDLQWREHHYHQPRUHSURQRXQFHGLIFDUERQLVLQWURGXFHGWRWKHV\VWHPDV SDVVLYHGRPDLQWREHHYHQPRUHSURQRXQFHGLIFDUERQLVLQWURGXFHGWRWKHV\VWHPDV
WKHIRUPDWLRQRISDVVLYHFRPSRXQGVLQFRQQHFWLRQZLWKFDOFLXPFDUERQDWHZLOOEHID WKHIRUPDWLRQRISDVVLYHFRPSRXQGVLQFRQQHFWLRQZLWKFDOFLXPFDUERQDWHZLOOEHID
YRXUHG FI)LJXUH>&@LQ6HFWLRQ   YRXUHG FI)LJXUH>&@LQ6HFWLRQ  
7KH HIIHFW RI DGGLQJ FDUERQ WR WKH =Q+2 V\VWHP FDQ EH GLUHFWO\ HVWLPDWHG E\ WKH 7KH HIIHFW RI DGGLQJ FDUERQ WR WKH =Q+2 V\VWHP FDQ EH GLUHFWO\ HVWLPDWHG E\ WKH
µ0(3'¶RIWKH=Q&+2V\VWHPVHH)LJXUH>$@ µ0(3'¶RIWKH=Q&+2V\VWHPVHH)LJXUH>$@

 
)LJXUH >$@=Q&+2µ0(3'¶EDVHGRQ7DEOHDQG=QLD íPRO/DQG )LJXUH >$@=Q&+2µ0(3'¶EDVHGRQ7DEOHDQG=QLD íPRO/DQG
&LD PRO/>%@=Q&O+2µ0(3'¶EDVHGRQ7DEOHDQG=QLD  &LD PRO/>%@=Q&O+2µ0(3'¶EDVHGRQ7DEOHDQG=QLD 
íPRO/DQG&OLD íPRO/>&@$V>%@EXWZLWK&OLD %DVHG íPRO/DQG&OLD íPRO/>&@$V>%@EXWZLWK&OLD %DVHG
RQ =QLD  í PRO/ =Q&O LV IDYRXUHG RYHU =Q LQ WKH DVVRFLDWHG RQ =QLD  í PRO/ =Q&O LV IDYRXUHG RYHU =Q LQ WKH DVVRFLDWHG
VWDELOLW\GRPDLQIURPDERYH&OLD PRO/ VWDELOLW\GRPDLQIURPDERYH&OLD PRO/
7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH=Q&+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH=Q&+2V\VWHP

6ROLG & =Q =Q&2 =Q 2+   6ROLG & =Q =Q&2 =Q 2+  


í í í  í í í í 
6ROXEOH &2  +&2  +=Q2  =Q  =Q2  6ROXEOH &2  +&2  +=Q2  =Q  =Q2í
 
7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH=Q&O+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH=Q&O+2V\VWHP

6ROLG =Q =Q 2+      6ROLG =Q =Q 2+     


í í í   í í í í  
6ROXEOH &O  &O2  +=Q2  =Q  =Q&O  =Q2  6ROXEOH &O  &O2  +=Q2  =Q  =Q&O  =Q2í
 
)LJXUH>$@LQGLFDWHVWKDWIRUPDWLRQRI]LQFFDUERQDWH =Q&2 LQFUHDVHVWKHSDV )LJXUH>$@LQGLFDWHVWKDWIRUPDWLRQRI]LQFFDUERQDWH =Q&2 LQFUHDVHVWKHSDV
VLYHGRPDLQRI]LQFIURPDS+UDQJHRIDERXWWRDS+UDQJHRIDERXWZKLFK VLYHGRPDLQRI]LQFIURPDS+UDQJHRIDERXWWRDS+UDQJHRIDERXWZKLFK

 

,WLVDOVRZHOONQRZQWKDW³KDUGZDWHU´LHZDWHUZLWKKLJKFRQWHQWVRI&D&2SURWHFWV]LQFDJDLQVW ,WLVDOVRZHOONQRZQWKDW³KDUGZDWHU´LHZDWHUZLWKKLJKFRQWHQWVRI&D&2SURWHFWV]LQFDJDLQVW
FRUURVLRQ FRUURVLRQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV

LVLQJRRGDJUHHPHQWZLWKHJPHDVXUHPHQWVRI]LQFLPPHUVHGLQVROXWLRQVFRQWDLQLQJ LVLQJRRGDJUHHPHQWZLWKHJPHDVXUHPHQWVRI]LQFLPPHUVHGLQVROXWLRQVFRQWDLQLQJ
&2 >3RXUEDL[ E =KDQJ @ :H WKLQN WKDW WKLV LQFUHDVH UHIOHFWV WKH UHVLV &2 >3RXUEDL[ E =KDQJ @ :H WKLQN WKDW WKLV LQFUHDVH UHIOHFWV WKH UHVLV
WDQFHRIJDOYDQLVHGUHEDUWRFDUERQDWLRQLQGXFHGFRUURVLRQ NHHSLQJLQPLQGWKDWWKH WDQFHRIJDOYDQLVHGUHEDUWRFDUERQDWLRQLQGXFHGFRUURVLRQ NHHSLQJLQPLQGWKDWWKH
SDVVLYHGRPDLQLVDVVXPHGWREHIXUWKHULQFUHDVHGZLWKDGGLWLRQRIFDOFLXP  SDVVLYHGRPDLQLVDVVXPHGWREHIXUWKHULQFUHDVHGZLWKDGGLWLRQRIFDOFLXP 
,Q )LJXUH  >%@ DQG >&@ WKH LQIOXHQFH RI DGGLQJ FKORULGH WR WKH =Q+2 V\VWHP LV ,Q )LJXUH  >%@ DQG >&@ WKH LQIOXHQFH RI DGGLQJ FKORULGH WR WKH =Q+2 V\VWHP LV
LOOXVWUDWHG,WFDQEHREVHUYHGWKDWFRQWUDU\WRLURQ FI6HFWLRQ ORZHUFKOR LOOXVWUDWHG,WFDQEHREVHUYHGWKDWFRQWUDU\WRLURQ FI6HFWLRQ ORZHUFKOR
ULGH LRQ DFWLYLWLHV GR QRW KDYH D WKHUPRG\QDPLF HIIHFW RQ WKH H[WHQW RI SDVVLYH GR ULGH LRQ DFWLYLWLHV GR QRW KDYH D WKHUPRG\QDPLF HIIHFW RQ WKH H[WHQW RI SDVVLYH GR
PDLQVLQWKH=Q&O+2V\VWHP%DVHGRQ=QLD íPRO/IRUPDWLRQRIFKORUR]LQF PDLQVLQWKH=Q&O+2V\VWHP%DVHGRQ=QLD íPRO/IRUPDWLRQRIFKORUR]LQF
LRQ =Q&O LVRQO\IDYRXUHGRYHU=QIURPDERYH&OLD PRO/+RZHYHUIURP LRQ =Q&O LVRQO\IDYRXUHGRYHU=QIURPDERYH&OLD PRO/+RZHYHUIURP
)LJXUH>%@DQG>&@LWFDQEHFRQFOXGHGWKDW]LQFDORQHDQGKHQFHJDOYDQLVHGUHLQ )LJXUH>%@DQG>&@LWFDQEHFRQFOXGHGWKDW]LQFDORQHDQGKHQFHJDOYDQLVHGUHLQ
IRUFHPHQWGRHVQRWSURYLGHDVDWLVIDFWRU\JDLQLQFRUURVLRQSURWHFWLRQLQWKHFKORULGH IRUFHPHQWGRHVQRWSURYLGHDVDWLVIDFWRU\JDLQLQFRUURVLRQSURWHFWLRQLQWKHFKORULGH
HQYLURQPHQW FI FULWLFDO µ(FRUU¶ DQG S+ LGHQWLILHG LQ )LJXUH  LQ 6HFWLRQ  DQG HQYLURQPHQW FI FULWLFDO µ(FRUU¶ DQG S+ LGHQWLILHG LQ )LJXUH  LQ 6HFWLRQ  DQG
FKORULGHWKUHVKROGVRIJDOYDQLVHGUHLQIRUFHPHQWLQ6HFWLRQ  FKORULGHWKUHVKROGVRIJDOYDQLVHGUHLQIRUFHPHQWLQ6HFWLRQ 
1HYHUWKHOHVV ]LQF SOD\V D UROH LQ RXU WKHUPRG\QDPLF DSSURDFK FI 6HFWLRQ   1HYHUWKHOHVV ]LQF SOD\V D UROH LQ RXU WKHUPRG\QDPLF DSSURDFK FI 6HFWLRQ  
%HVLGHVLWVFRQWULEXWLRQLQWKHHVWDEOLVKPHQWRIDWDUJHWHGORZµ(FRUU¶ %XOOHW$LQ6HF %HVLGHVLWVFRQWULEXWLRQLQWKHHVWDEOLVKPHQWRIDWDUJHWHGORZµ(FRUU¶ %XOOHW$LQ6HF
WLRQ WKHPRVWLPSRUWDQWUROHRI]LQFLQµ3ULQFLSOH,¶LVWKHIRUPDWLRQRIVWDEOH WLRQ WKHPRVWLPSRUWDQWUROHRI]LQFLQµ3ULQFLSOH,¶LVWKHIRUPDWLRQRIVWDEOH
SDVVLYHFRPSRXQGVLQFRPELQDWLRQZLWKLURQ %XOOHW%LQ6HFWLRQ LH]LQFIHU SDVVLYHFRPSRXQGVLQFRPELQDWLRQZLWKLURQ %XOOHW%LQ6HFWLRQ LH]LQFIHU
ULWH =Q)H2 FI)LJXUH ULWH =Q)H2 FI)LJXUH
:LWKUHJDUGWRWKHHVWDEOLVKPHQWRIDWDUJHWHGORZµ(FRUU¶LWVKRXOGEHQRWHGWKDWDO :LWKUHJDUGWRWKHHVWDEOLVKPHQWRIDWDUJHWHGORZµ(FRUU¶LWVKRXOGEHQRWHGWKDWDO
WKRXJK]LQFLVJHQHUDOO\DQRGLFWRLURQ  FI6HFWLRQ ]LQFDQRGHVDUHQRUPDOO\ WKRXJK]LQFLVJHQHUDOO\DQRGLFWRLURQ  FI6HFWLRQ ]LQFDQRGHVDUHQRUPDOO\
VSHFLILHGWRVWULFWFKHPLFDOFRPSRVLWLRQVDVLPSXULWLHVFDQLPSDLUWKHSHUIRUPDQFHRI VSHFLILHGWRVWULFWFKHPLFDOFRPSRVLWLRQVDVLPSXULWLHVFDQLPSDLUWKHSHUIRUPDQFHRI
WKH DQRGH WKH PRVW GHWULPHQWDO LPSXULW\ EHLQJ LURQ >=KDQJ  5REHUJH @ WKH DQRGH WKH PRVW GHWULPHQWDO LPSXULW\ EHLQJ LURQ >=KDQJ  5REHUJH @
$FFRUGLQJWR>5REHUJH@LURQFDQSUHFLSLWDWHDVLQWHUPHWDOOLFSDUWLFOHVOHDGLQJWR $FFRUGLQJWR>5REHUJH@LURQFDQSUHFLSLWDWHDVLQWHUPHWDOOLFSDUWLFOHVOHDGLQJWR
IRUPDWLRQRIJDOYDQLFFHOOVRQD]LQFDQRGHHYHQLISUHVHQWLQYHU\ORZFRQFHQWUDWLRQV IRUPDWLRQRIJDOYDQLFFHOOVRQD]LQFDQRGHHYHQLISUHVHQWLQYHU\ORZFRQFHQWUDWLRQV
RQO\,QFRPELQDWLRQZLWKWKHIRUPDWLRQRIHOHFWULFDOO\QRQFRQGXFWLYH]LQFK\GUR[LGH RQO\,QFRPELQDWLRQZLWKWKHIRUPDWLRQRIHOHFWULFDOO\QRQFRQGXFWLYH]LQFK\GUR[LGH
FI6HFWLRQ ZHWKLQNWKDWWKLVFDQKDYHDVLJQLILFDQWHIIHFWLQUHGXFLQJWKHDQ FI6HFWLRQ ZHWKLQNWKDWWKLVFDQKDYHDVLJQLILFDQWHIIHFWLQUHGXFLQJWKHDQ
RGHHIILFLHQF\ RGHHIILFLHQF\
7KHPDLQUROHRI]LQFLQµ3ULQFLSOH,¶LVWRUHSODFH)H22+E\DPRUHVWDEOHSDVVLYH 7KHPDLQUROHRI]LQFLQµ3ULQFLSOH,¶LVWRUHSODFH)H22+E\DPRUHVWDEOHSDVVLYH
SURGXFW7KDWPHDQVWKDWWKHVWDELOLW\RIWKHSDVVLYHOD\HULVLPSURYHGDWDORZµ(FRUU¶ SURGXFW7KDWPHDQVWKDWWKHVWDELOLW\RIWKHSDVVLYHOD\HULVLPSURYHGDWDORZµ(FRUU¶
ZKLFKZHFRQVLGHUWREHDWKHUPRG\QDPLFDOO\FRQVLVWHQWDSSURDFKIRUFRUURVLRQSUR ZKLFKZHFRQVLGHUWREHDWKHUPRG\QDPLFDOO\FRQVLVWHQWDSSURDFKIRUFRUURVLRQSUR
WHFWLRQ WHFWLRQ
)LJXUH  DQG )LJXUH  LOOXVWUDWH WKH WKHUPRG\QDPLFV RI =Q)H2 DW GLIIHUHQW LRQ )LJXUH  DQG )LJXUH  LOOXVWUDWH WKH WKHUPRG\QDPLFV RI =Q)H2 DW GLIIHUHQW LRQ
DFWLYLWLHVLQWKH)H=Q&O+2V\VWHPDQGWKH=Q)H&O+2UHVSHFWLYHO\ DFWLYLWLHVLQWKH)H=Q&O+2V\VWHPDQGWKH=Q)H&O+2UHVSHFWLYHO\

 

7KLVLVWUXHIRUWKHQRUPDODPELHQWWHPSHUDWXUHHQYLURQPHQWVWKHFRXQWHUPHDVXUHVDUHGHVLJQHGIRU 7KLVLVWUXHIRUWKHQRUPDODPELHQWWHPSHUDWXUHHQYLURQPHQWVWKHFRXQWHUPHDVXUHVDUHGHVLJQHGIRU
FI%XOOHWLQ6HFWLRQ +RZHYHULURQEHFRPHVDQRGLFWR]LQFZKHQWKHWHPSHUDWXUHLVUDLVHG FI%XOOHWLQ6HFWLRQ +RZHYHULURQEHFRPHVDQRGLFWR]LQFZKHQWKHWHPSHUDWXUHLVUDLVHG
DERYHHJƒ&>5REHUJH@ DERYHHJƒ&>5REHUJH@

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV

 
)LJXUH )H=Q&O+2 µ0(3'V¶ EDVHG RQ 7DEOH  DQG GLIIHUHQW LRQ DFWLYL )LJXUH )H=Q&O+2 µ0(3'V¶ EDVHG RQ 7DEOH  DQG GLIIHUHQW LRQ DFWLYL
WLHV>$@)HLD íPRO/=QLD íPRO/DQG&LD íPRO/ WLHV>$@)HLD íPRO/=QLD íPRO/DQG&LD íPRO/
>%@)HLD íPRO/=QLD íPRO/DQG&LD íPRO/>&@ >%@)HLD íPRO/=QLD íPRO/DQG&LD íPRO/>&@
)HLD PRO/=QLD PRO/DQG&LD PRO/ )HLD PRO/=QLD PRO/DQG&LD PRO/
 

 
)LJXUH =Q)H&O+2 µ0(3'V¶ EDVHG RQ 7DEOH  DQG GLIIHUHQW LRQ DFWLYL )LJXUH =Q)H&O+2 µ0(3'V¶ EDVHG RQ 7DEOH  DQG GLIIHUHQW LRQ DFWLYL
WLHV>$@=QLD íPRO/)HLD íPRO/DQG&LD íPRO/ WLHV>$@=QLD íPRO/)HLD íPRO/DQG&LD íPRO/
>%@=QLD íPRO/)HLD íPRO/DQG&LD íPRO/>&@ >%@=QLD íPRO/)HLD íPRO/DQG&LD íPRO/>&@
=QLD PRO/)HLD PRO/DQG&LD PRO/ =QLD PRO/)HLD PRO/DQG&LD PRO/
 

7KHSUHVHOHFWLRQIRU)LJXUHDQG)LJXUHFRUUHVSRQGVWRWKHVSHFLHVOLVWHGLQ7D 7KHSUHVHOHFWLRQIRU)LJXUHDQG)LJXUHFRUUHVSRQGVWRWKHVSHFLHVOLVWHGLQ7D
EOH EOH
7DEOH 6SHFLHV SUHVHOHFWHG IRU WKH µ0(3'¶ RI WKH )H=Q&O+2 DQG WKH =Q 7DEOH 6SHFLHV SUHVHOHFWHG IRU WKH µ0(3'¶ RI WKH )H=Q&O+2 DQG WKH =Q
)H&O+2V\VWHP )H&O+2V\VWHP

6ROLG )H )H2 )H22+ =Q =Q)H2 =Q 2+  6ROLG )H )H2 )H22+ =Q =Q)H2 =Q 2+ 
í í     í í   
&O  &O2  )H  )H  )H&O  )H&O  &O  &O2  )H  )H  )H&O  )H&O
6ROXEOH 6ROXEOH
+)H2í +=Q2í =Q =Q&O =Q2í  +)H2í +=Q2í =Q =Q&O =Q2í 
 
,Q )LJXUH  LH LQ WKH )H=Q&O+2 V\VWHP LW FDQ EH VHHQ WKDW =Q)H2 LV ID ,Q )LJXUH  LH LQ WKH )H=Q&O+2 V\VWHP LW FDQ EH VHHQ WKDW =Q)H2 LV ID
YRXUHGRYHUDODUJHSDUWRIWKH)H22+DQGWKH)H2GRPDLQ,WVVWDELOLW\GRPDLQLQ YRXUHGRYHUDODUJHSDUWRIWKH)H22+DQGWKH)H2GRPDLQ,WVVWDELOLW\GRPDLQLQ
FUHDVHVRQWKHH[SHQVHRIWKHVHDUHDVDVZHOODVRQWKH+)H2íGRPDLQZLWKLQFUHDV FUHDVHVRQWKHH[SHQVHRIWKHVHDUHDVDVZHOODVRQWKH+)H2íGRPDLQZLWKLQFUHDV
LQJLRQDFWLYLWLHV7KHVWDELOLW\GRPDLQRI=Q)H2LQWKH=Q)H&O+2V\VWHPQDWX LQJLRQDFWLYLWLHV7KHVWDELOLW\GRPDLQRI=Q)H2LQWKH=Q)H&O+2V\VWHPQDWX
UDOO\FRUUHVSRQGVWRWKHRQHLQWKH)H=Q&O+2V\VWHP VHH)LJXUH ZKLFKVLJ UDOO\FRUUHVSRQGVWRWKHRQHLQWKH)H=Q&O+2V\VWHP VHH)LJXUH ZKLFKVLJ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV

QLILFDQWO\ LQFUHDVHV WKH H[WHQW RI SDVVLYLW\ FRPSDUHG WR WKH =Q&O+2 V\VWHP FI QLILFDQWO\ LQFUHDVHV WKH H[WHQW RI SDVVLYLW\ FRPSDUHG WR WKH =Q&O+2 V\VWHP FI
)LJXUH>%@  )LJXUH>%@ 
7KH SRVLWLYH DWWULEXWHV RI =Q)H2 LQ WHUPV RI FRUURVLRQ SURWHFWLRQ DUH ZHOO NQRZQ 7KH SRVLWLYH DWWULEXWHV RI =Q)H2 LQ WHUPV RI FRUURVLRQ SURWHFWLRQ DUH ZHOO NQRZQ
IURPSDLQWV\VWHPVIRUFRUURVLRQSUHYHQWLRQ>3DWWRQ$EX$\DQDHWDO @ IURPSDLQWV\VWHPVIRUFRUURVLRQSUHYHQWLRQ>3DWWRQ$EX$\DQDHWDO @
+RZHYHUWRRXUNQRZOHGJHWKHVHEHQHILFLDODWWULEXWHVKDYHVRIDUQRWEHHQDGDSWHGRU +RZHYHUWRRXUNQRZOHGJHWKHVHEHQHILFLDODWWULEXWHVKDYHVRIDUQRWEHHQDGDSWHGRU
DFNQRZOHGJHG LQ UHLQIRUFHPHQW FRUURVLRQ FRXQWHUPHDVXUHV 2Q WKH FRQWUDU\ WKH LQ DFNQRZOHGJHG LQ UHLQIRUFHPHQW FRUURVLRQ FRXQWHUPHDVXUHV 2Q WKH FRQWUDU\ WKH LQ
WHUPHWDOOLFOD\HUIRUPHGEHWZHHQ]LQFDQGWKHLURQVXEVWUDWHLQKRWGLSJDOYDQLVLQJ FI WHUPHWDOOLFOD\HUIRUPHGEHWZHHQ]LQFDQGWKHLURQVXEVWUDWHLQKRWGLSJDOYDQLVLQJ FI
6HFWLRQ LVJHQHUDOO\FRQVLGHUHGDVQRWSURYLGLQJIRUFRUURVLRQUHVLVWDQFH<HW 6HFWLRQ LVJHQHUDOO\FRQVLGHUHGDVQRWSURYLGLQJIRUFRUURVLRQUHVLVWDQFH<HW
ZHWKLQNWKDWWKHODFNRISHUIRUPDQFHRIWKLVOD\HULVUHODWHGWRWKHGLVVROXWLRQRIWKH ZHWKLQNWKDWWKHODFNRISHUIRUPDQFHRIWKLVOD\HULVUHODWHGWRWKHGLVVROXWLRQRIWKH
RXWHU ]LQF OD\HU ZKLFK FRPSURPLVHV WKH FRQFUHWHVWHHO LQWHUIDFH DQG KHQFH FRUUXSWV RXWHU ]LQF OD\HU ZKLFK FRPSURPLVHV WKH FRQFUHWHVWHHO LQWHUIDFH DQG KHQFH FRUUXSWV
WKHFRUURVLRQSURWHFWLRQ WKHFRUURVLRQSURWHFWLRQ
,IKRZHYHU]LQFIHUULWHLVSUHVHQWDWDGHQVHLQWHUIDFHDQGLQLWLDOGLVVROXWLRQRI]LQF ,IKRZHYHU]LQFIHUULWH LVSUHVHQWDWDGHQVHLQWHUIDFHDQGLQLWLDOGLVVROXWLRQRI]LQF
LRQVLVSUHYHQWHG FI6HFWLRQ ZHFRQVLGHU]LQFIHUULWHWRSURYLGHIRUH[FHOOHQW LRQVLVSUHYHQWHG FI6HFWLRQ ZHFRQVLGHU]LQFIHUULWHWRSURYLGHIRUH[FHOOHQW
FRUURVLRQUHVLVWDQFHIRUVWHHOLQFRQFUHWH FRUURVLRQUHVLVWDQFHIRUVWHHOLQFRQFUHWH
7KLV FRQFHSW ZDV YHULILHG LQ µ7HVW ,¶ DQG µ7HVW ,,¶ E\ VSHFLPHQV ³&´ FI 6HFWLRQ 7KLV FRQFHSW ZDV YHULILHG LQ µ7HVW ,¶ DQG µ7HVW ,,¶ E\ VSHFLPHQV ³&´ FI 6HFWLRQ
  DQG VSHFLPHQV ³&:´ ³&:´ FI 6HFWLRQ   UHVSHFWLYHO\ $V   DQG VSHFLPHQV ³&:´ ³&:´ FI 6HFWLRQ   UHVSHFWLYHO\ $V
PHQWLRQHG LQ 6HFWLRQ  DIWHU SUHWUHDWPHQW LH +&O HWFKLQJ LQ µ7HVW ,¶ DQG JULW PHQWLRQHG LQ 6HFWLRQ  DIWHU SUHWUHDWPHQW LH +&O HWFKLQJ LQ µ7HVW ,¶ DQG JULW
EODVWLQJLQµ7HVW,,¶WKHDVVRFLDWHGUHEDUVDPSOHVZHUHHOHFWURO\WLFDOO\JDOYDQLVHG FI EODVWLQJLQµ7HVW,,¶WKHDVVRFLDWHGUHEDUVDPSOHVZHUHHOHFWURO\WLFDOO\JDOYDQLVHG FI
6HFWLRQ ZLWKDWKLQ]LQFOD\HURI—P7KHSHUIRUPDQFHRIWKLVJDOYDQLVHGUH 6HFWLRQ ZLWKDWKLQ]LQFOD\HURI—P7KHSHUIRUPDQFHRIWKLVJDOYDQLVHGUH
EDUV HPEHGGHG LQ PRUWDU ZDV YHULILHG E\ µ(FRUU¶ PRQLWRULQJ FI 6HFWLRQ  DQG EDUV HPEHGGHG LQ PRUWDU ZDV YHULILHG E\ µ(FRUU¶ PRQLWRULQJ FI 6HFWLRQ  DQG
  µ(,6¶ FI 6HFWLRQV  DQG   DQG SRODULVDWLRQ FXUYHV FI 6HFWLRQV   µ(,6¶ FI 6HFWLRQV  DQG   DQG SRODULVDWLRQ FXUYHV FI 6HFWLRQV
DQG $OOPHDVXUHPHQWVVKRZHGWKDWLQFRQWUDVWWRWKHORVVRI—P DQG $OOPHDVXUHPHQWVVKRZHGWKDWLQFRQWUDVWWRWKHORVVRI—P
IRU SDVVLYDWLRQ RI D SXUH WKLFN ]LQF OD\HU GHVFULEHG LQ WKH OLWHUDWXUH FI 6HFWLRQ IRU SDVVLYDWLRQ RI D SXUH WKLFN ]LQF OD\HU GHVFULEHG LQ WKH OLWHUDWXUH FI 6HFWLRQ
  WKH ]LQF IHUULWH OD\HU UHPDLQHG LQWDFW DQG ODVWHG GXULQJ DQ H[WHQGHG SHULRG   WKH ]LQF IHUULWH OD\HU UHPDLQHG LQWDFW DQG ODVWHG GXULQJ DQ H[WHQGHG SHULRG
HYHQ XQGHU VHYHUH FKORULGH H[SRVXUH >.WHU HWDO E@ 7KH SHUIRUPDQFH RI WKH HYHQ XQGHU VHYHUH FKORULGH H[SRVXUH >.WHU HWDO E@ 7KH SHUIRUPDQFH RI WKH
]LQFIHUULWHOD\HUZDVDOVRYHULILHGE\PHDQVRIYLVXDOLQVSHFWLRQRIWKHDVVRFLDWHGFH ]LQFIHUULWHOD\HUZDVDOVRYHULILHGE\PHDQVRIYLVXDOLQVSHFWLRQRIWKHDVVRFLDWHGFH
PHQWSDVWHVSHFLPHQVDQGE\µ(FRUU¶PHDVXUHPHQWVEHIRUHDQGDIWHUWKHFHPHQWSDVWH PHQWSDVWHVSHFLPHQVDQGE\µ(FRUU¶PHDVXUHPHQWVEHIRUHDQGDIWHUWKHFHPHQWSDVWH
ZDVDSSOLHG ZDVDSSOLHG
7R DYRLG DQ\ K\GURJHQ HYROXWLRQ WKH UHEDU VDPSOHV ZHUH GLSSHG LQWR VDWXUDWHG 7R DYRLG DQ\ K\GURJHQ HYROXWLRQ WKH UHEDU VDPSOHV ZHUH GLSSHG LQWR VDWXUDWHG
&D 2+ VROXWLRQ FXULQJ FRQWDLQHUFI )LJXUHLQ6HFWLRQ EHIRUHWKH FH &D 2+ VROXWLRQ FXULQJ FRQWDLQHUFI )LJXUHLQ6HFWLRQ EHIRUHWKH FH
PHQW SDVWH ZDV DSSOLHG 6XEVHTXHQW HOHFWURFKHPLFDO PHDVXUHPHQWV VKRZHG WKDW WKH PHQW SDVWH ZDV DSSOLHG 6XEVHTXHQW HOHFWURFKHPLFDO PHDVXUHPHQWV VKRZHG WKDW WKH
]LQFIHUULWHOD\HUZDVIXOO\LQWDFWDQGSURYLGHGIRUDVLJQLILFDQWJDLQLQFRUURVLRQSUR ]LQFIHUULWHOD\HUZDVIXOO\LQWDFWDQGSURYLGHGIRUDVLJQLILFDQWJDLQLQFRUURVLRQSUR
WHFWLRQ ZKLFK ZDV DOVR YHULILHG E\ µ(,6¶ DQG SRODULVDWLRQ FXUYH PHDVXUHPHQWV FI WHFWLRQ ZKLFK ZDV DOVR YHULILHG E\ µ(,6¶ DQG SRODULVDWLRQ FXUYH PHDVXUHPHQWV FI
6HFWLRQV  DQG   +RZHYHU WKH SHUIRUPDQFH JDLQ XQGHU ZRUVW FRQGLWLRQV 6HFWLRQV  DQG   +RZHYHU WKH SHUIRUPDQFH JDLQ XQGHU ZRUVW FRQGLWLRQV
LHZLWKDFWLYDWHGPDFURFHOO FRQQHFWLRQWRDFWLYDWHG7Lµ(&DW¶ DQGFKORULGHH[SRVXUH LHZLWKDFWLYDWHGPDFURFHOO FRQQHFWLRQWRDFWLYDWHG7Lµ(&DW¶ DQGFKORULGHH[SRVXUH
FI6HFWLRQDQG ZDVUHODWLYHO\QHJOLJLEOH6RWKHLQLWLDO—P]LQFOD\HU FI6HFWLRQDQG ZDVUHODWLYHO\QHJOLJLEOH6RWKHLQLWLDO—P]LQFOD\HU
GRHV QRW SURYLGH ORQJWHUP SURWHFWLRQ DJDLQVW FKORULGH LQGXFHG FRUURVLRQ <HW ZH GRHV QRW SURYLGH ORQJWHUP SURWHFWLRQ DJDLQVW FKORULGH LQGXFHG FRUURVLRQ <HW ZH
FRQVLGHUWKLVDSSOLFDWLRQRI]LQFDVLPSOHDQGFRVWHIILFLHQWPHDVXUHDJDLQVWFDUERQD FRQVLGHUWKLVDSSOLFDWLRQRI]LQFDVLPSOHDQGFRVWHIILFLHQWPHDVXUHDJDLQVWFDUERQD
WLRQLQGXFHGFRUURVLRQ WLRQLQGXFHGFRUURVLRQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV

)RUµ3ULQFLSOH ,¶WKHLQLWLDOFRUURVLRQDFWLYLW\RI]LQFLVFRPSHQVDWHGE\ PDJQHVLXP )RUµ3ULQFLSOH ,¶WKHLQLWLDOFRUURVLRQDFWLYLW\RI]LQFLVFRPSHQVDWHGE\ PDJQHVLXP


ZKLFK ZLOO EH GHDOW ZLWK LQ 6HFWLRQ  7KLV ZD\ D VWDEOH SDVVLYH OD\HU LV PDLQ ZKLFK ZLOO EH GHDOW ZLWK LQ 6HFWLRQ  7KLV ZD\ D VWDEOH SDVVLYH OD\HU LV PDLQ
WDLQHGLQFRUUHVSRQGHQFHZLWK)LJXUH>%@7KH=Q)H&O+2µ0(3'¶RI)LJXUH WDLQHGLQFRUUHVSRQGHQFHZLWK)LJXUH>%@7KH=Q)H&O+2µ0(3'¶RI)LJXUH
 >%@ LV VXSHULPSRVHG RQ WKH ³VWDQGDUG´ )H&O+2 V\VWHP LQ )LJXUH  >$@ ,Q  >%@ LV VXSHULPSRVHG RQ WKH ³VWDQGDUG´ )H&O+2 V\VWHP LQ )LJXUH  >$@ ,Q
)LJXUH>$@LWFDQEH REVHUYHGWKDWWKHSDVVLYHOD\HUFRYHUVWKHLGHQWLILHGFULWLFDO )LJXUH>$@LWFDQEH REVHUYHGWKDWWKHSDVVLYHOD\HUFRYHUVWKHLGHQWLILHGFULWLFDO
SDUWIRUFRUURVLRQLQLWLDWLRQDQGWKXVSURWHFWVWKHVWHHOIURPFKORULGHLQGXFHGFRUURVLRQ SDUWIRUFRUURVLRQLQLWLDWLRQDQGWKXVSURWHFWVWKHVWHHOIURPFKORULGHLQGXFHGFRUURVLRQ
HYHQDWKLJKFRQFHQWUDWLRQV7KHH[WHQGHGSURWHFWLRQLVGXHWRWKHDWWDLQPHQWRIUHOD HYHQDWKLJKFRQFHQWUDWLRQV7KHH[WHQGHGSURWHFWLRQLVGXHWRWKHDWWDLQPHQWRIUHOD
WLYHO\KLJK]LQFDQGLURQLRQDFWLYLWLHVEHFDXVHLRQGLIIXVLRQLVOLPLWHGE\WKHGHQVL WLYHO\KLJK]LQFDQGLURQLRQDFWLYLWLHVEHFDXVHLRQGLIIXVLRQLVOLPLWHGE\WKHGHQVL
ILHGFRQFUHWHVWHHOLQWHUIDFH FI6HFWLRQ  ILHGFRQFUHWHVWHHOLQWHUIDFH FI6HFWLRQ 

 
)LJXUH >$@µ6,3'¶RI=Q)H&O+2µ0(3'¶EDVHGRQ7DEOHZLWK=QLD  )LJXUH >$@µ6,3'¶RI=Q)H&O+2µ0(3'¶EDVHGRQ7DEOHZLWK=QLD 
 PRO/ )HLD   PRO/ DQG &OLD   PRO/ RQ )H&O+2 µ0(3'¶  PRO/ )HLD   PRO/ DQG &OLD   PRO/ RQ )H&O+2 µ0(3'¶
EDVHGRQ7DEOHDQG)HLD íPRO/DQG&OLD PRO/>%@=Q EDVHGRQ7DEOHDQG)HLD íPRO/DQG&OLD PRO/>%@=Q
)H&O+2µ0(3'¶EDVHGRQ7DEOHZLWK=QLD íPRO/)HLD  )H&O+2µ0(3'¶EDVHGRQ7DEOHZLWK=QLD íPRO/)HLD 
íPRO/DQG&OLD PRO/>&@$V>$@EXWZLWK=QLD íPRO/ íPRO/DQG&OLD PRO/>&@$V>$@EXWZLWK=QLD íPRO/
DQG)HLD íPRO/IRUWKHVXSHULPSRVHG=Q)H&O+2µ0(3'¶ DQG)HLD íPRO/IRUWKHVXSHULPSRVHG=Q)H&O+2µ0(3'¶
)LJXUH>$@UHSUHVHQWVWKHFRQGLWLRQIRUµ3ULQFLSOH,¶DWDQLQWDFWPRGLILHGFRQFUHWH )LJXUH>$@UHSUHVHQWVWKHFRQGLWLRQIRUµ3ULQFLSOH,¶DWDQLQWDFWPRGLILHGFRQFUHWH
VWHHO LQWHUIDFH LH IRU WKH JHQHUDO GHVLJQ VLWXDWLRQ +RZHYHU WKH FRQGLWLRQ DW D GLV VWHHO LQWHUIDFH LH IRU WKH JHQHUDO GHVLJQ VLWXDWLRQ +RZHYHU WKH FRQGLWLRQ DW D GLV
FRQWLQXLW\ HJDWDQXQLQWHQGHGGHIHFWRUDWDFXWRII RULQWKHYLFLQLW\RIDFRQFUHWH FRQWLQXLW\ HJDWDQXQLQWHQGHGGHIHFWRUDWDFXWRII RULQWKHYLFLQLW\RIDFRQFUHWH
FUDFN ZKHUH WKH VXUIDFH PRGLILFDWLRQ PD\ EH FRPSURPLVHG LV GLIIHUHQW )RU WKHVH FUDFN ZKHUH WKH VXUIDFH PRGLILFDWLRQ PD\ EH FRPSURPLVHG LV GLIIHUHQW )RU WKHVH
FRQGLWLRQV DV ZHOO DV IRU WKH JHQHUDO GHVLJQ VLWXDWLRQ IRU µ3ULQFLSOH ,,¶ HIIHFWLYH FD FRQGLWLRQV DV ZHOO DV IRU WKH JHQHUDO GHVLJQ VLWXDWLRQ IRU µ3ULQFLSOH ,,¶ HIIHFWLYH FD
WKRGLFSURWHFWLRQLVDLPHGDW(IIHFWLYHFDWKRGLFSURWHFWLRQFDQRQO\EHDFKLHYHGLIWKH WKRGLFSURWHFWLRQLVDLPHGDW(IIHFWLYHFDWKRGLFSURWHFWLRQFDQRQO\EHDFKLHYHGLIWKH
VDFULILFLDOPHWDOLHWKH OHVVQREOHFRDWLQJRUWKHVDFULILFLDODQRGHLVQRWSDVVLYHLQ VDFULILFLDOPHWDOLHWKH OHVVQREOHFRDWLQJRUWKHVDFULILFLDODQRGHLVQRWSDVVLYHLQ
WKH FULWLFDO S+ DQG µ(FRUU¶ UDQJH 7KDW PHDQV WKDW JHQHUDO SDVVLYDWLRQ RU SDVVLYDWLRQ WKH FULWLFDO S+ DQG µ(FRUU¶ UDQJH 7KDW PHDQV WKDW JHQHUDO SDVVLYDWLRQ RU SDVVLYDWLRQ
GXHWRKLJKHULRQDFWLYLWLHVLVWREHSUHYHQWHG7KHWKHUPRG\QDPLFVDWDGLVFRQWLQXLW\ GXHWRKLJKHULRQDFWLYLWLHVLVWREHSUHYHQWHG7KHWKHUPRG\QDPLFVDWDGLVFRQWLQXLW\
LQµ3ULQFLSOH,¶ZKLFKFRUUHVSRQGVWRWKHJHQHUDOGHVLJQVLWXDWLRQIRUµ3ULQFLSOH,,¶LV LQµ3ULQFLSOH,¶ZKLFKFRUUHVSRQGVWRWKHJHQHUDOGHVLJQVLWXDWLRQIRUµ3ULQFLSOH,,¶LV
UHSUHVHQWHGE\)LJXUH>%@DQG>&@ UHSUHVHQWHGE\)LJXUH>%@DQG>&@
)LJXUH>%@LOOXVWUDWHVWKHHIIHFWRIWKHFKORULGHLRQDFWLYLW\RQWKH=Q)H&O+2 )LJXUH>%@LOOXVWUDWHVWKHHIIHFWRIWKHFKORULGHLRQDFWLYLW\RQWKH=Q)H&O+2
µ0(3'¶DWORZLURQDQG]LQFLRQDFWLYLWLHV íPRO/ $FRPSDULVRQRI)LJXUH µ0(3'¶DWORZLURQDQG]LQFLRQDFWLYLWLHV íPRO/ $FRPSDULVRQRI)LJXUH
>$@DQG)LJXUH>%@VKRZVWKDWLQFRQWUDVWWRV\VWHPV ZKHUH)HLVWKHPDLQHOH >$@DQG)LJXUH>%@VKRZVWKDWLQFRQWUDVWWRV\VWHPV ZKHUH )H LV WKH PDLQHOH
PHQWWKHDSSHDUDQFHRIVWDELOLW\GRPDLQVLQWKH=Q)H&O+2V\VWHPLVDOPRVWLGHQ PHQWWKHDSSHDUDQFHRIVWDELOLW\GRPDLQVLQWKH=Q)H&O+2V\VWHPLVDOPRVWLGHQ
WLFDOIRUUHODWLYHO\ORZ íPRO/ DQGKLJK PRO/ FKORULGHLRQDFWLYLWLHV+HQFH WLFDOIRUUHODWLYHO\ORZ íPRO/ DQGKLJK PRO/ FKORULGHLRQDFWLYLWLHV+HQFH

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV

]LQFIHUULWH LQFRPELQDWLRQZLWKPDJQHVLXPFI6HFWLRQ FDQSURYLGHIRU HIIL ]LQFIHUULWH LQFRPELQDWLRQZLWKPDJQHVLXPFI6HFWLRQ FDQSURYLGHIRU HIIL


FLHQWFDWKRGLFSURWHFWLRQZKLFKLVLOOXVWUDWHGLQ)LJXUH>&@ FLHQWFDWKRGLFSURWHFWLRQZKLFKLVLOOXVWUDWHGLQ)LJXUH>&@
)LJXUH>&@SUHVHQWVWKHVXSHULPSRVLWLRQRI)LJXUH>%@RQWKH³VWDQGDUG´)H&O )LJXUH>&@SUHVHQWVWKHVXSHULPSRVLWLRQRI)LJXUH>%@RQWKH³VWDQGDUG´)H&O
+2 µ0(3'¶ ZKLOH LQ FRQWUDVW WR )LJXUH  >$@  VDFULILFLDO GRPDLQV DUH VKRZQ +2 µ0(3'¶ ZKLOH LQ FRQWUDVW WR )LJXUH  >$@  VDFULILFLDO GRPDLQV DUH VKRZQ
WUDQVSDUHQWO\ ,W FDQ EH REVHUYHG WKDW VDFULILFLDO FRUURVLRQ FRYHUV DOO FULWLFDO DUHDV WUDQVSDUHQWO\ ,W FDQ EH REVHUYHG WKDW VDFULILFLDO FRUURVLRQ FRYHUV DOO FULWLFDO DUHDV
ZKHQDSSOLHGDVDVXUIDFHPRGLILFDWLRQLHµ3ULQFLSOH,¶ ZKHQDSSOLHGDVDVXUIDFHPRGLILFDWLRQLHµ3ULQFLSOH,¶
+RZHYHUGXHWRSDVVLYDWLRQLQDS+UDQJHIURPVDFULILFLDODFWLRQFDQQRWEHDW +RZHYHUGXHWRSDVVLYDWLRQLQDS+UDQJHIURPVDFULILFLDODFWLRQFDQQRWEHDW
WDLQHGE\]LQFIHUULWHDORQHZKHQWKHFRXQWHUPHDVXUHLVEDVHGRQVDFULILFLDOSURWHFWLRQ WDLQHGE\]LQFIHUULWHDORQHZKHQWKHFRXQWHUPHDVXUHLVEDVHGRQVDFULILFLDOSURWHFWLRQ
E\HPEHGGHGHOHFWURGHVLHµ3ULQFLSOH,,¶%DVHGRQWKHSUHGLFWHGLQFUHDVHLQSDVVLYH E\HPEHGGHGHOHFWURGHVLHµ3ULQFLSOH,,¶%DVHGRQWKHSUHGLFWHGLQFUHDVHLQSDVVLYH
GRPDLQVZLWKSUHVHQFHRIFDOFLXPDQGRUFDUERQZHFRQVLGHUWKDWSDVVLYDWLRQFDQDOVR GRPDLQVZLWKSUHVHQFHRIFDOFLXPDQGRUFDUERQZHFRQVLGHUWKDWSDVVLYDWLRQFDQDOVR
EHDSUREOHPRI]LQFXVHGDORQHLQFRQFUHWH(PEHGGHGHOHFWURGHVDUHJHQHUDOO\VSD EHDSUREOHPRI]LQFXVHGDORQHLQFRQFUHWH(PEHGGHGHOHFWURGHVDUHJHQHUDOO\VSD
WLDOO\VHSDUDWHGIURPWKHGHIHFWLHWKHDUHDRISRVVLEOHFRUURVLRQLQLWLDWLRQDQGDUH WLDOO\VHSDUDWHGIURPWKHGHIHFWLHWKHDUHDRISRVVLEOHFRUURVLRQLQLWLDWLRQDQGDUH
QRWQHFHVVDULO\DIIHFWHGE\S+FKDQJHV,QRXUDSSURDFKWRZDUGVHIIHFWLYHVDFULILFLDO QRWQHFHVVDULO\DIIHFWHGE\S+FKDQJHV,QRXUDSSURDFKWRZDUGVHIIHFWLYHVDFULILFLDO
DQRGHVZHSURYLGHIRUVXSSOHPHQWDU\SURWHFWLRQE\PDJQHVLXP FI6HFWLRQ  DQRGHVZHSURYLGHIRUVXSSOHPHQWDU\SURWHFWLRQE\PDJQHVLXP FI6HFWLRQ 
:HFRQVLGHUPDWHULDOVFRQFHSWVZKLFKDUHEDVHGRQ]LQFDVVLQJOH VDFULILFLDO PHWDO :HFRQVLGHUPDWHULDOVFRQFHSWVZKLFKDUHEDVHGRQ]LQFDVVLQJOH VDFULILFLDO PHWDO
QRWWREHIUHHRIULVNVDVLWLVGLIILFXOWWRDVVXUHWKDW]LQFZLOOEHHOHFWURFKHPLFDOO\DF QRWWREHIUHHRIULVNVDVLWLVGLIILFXOWWRDVVXUHWKDW]LQFZLOOEHHOHFWURFKHPLFDOO\DF
WLYHDWDQ\WLPH LQSDUWLFXODUZLWKUHJDUGWRWKHJHQHUDOGHVLJQVHUYLFHOLYHVRIFRQ WLYHDWDQ\WLPH LQSDUWLFXODUZLWKUHJDUGWRWKHJHQHUDOGHVLJQVHUYLFHOLYHVRIFRQ
FUHWHVWUXFWXUHVFI6HFWLRQ 0RUHRYHUWKHPHQWLRQHGSUHFLSLWDWLRQRILQWHUPHWDO FUHWHVWUXFWXUHVFI6HFWLRQ 0RUHRYHUWKHPHQWLRQHGSUHFLSLWDWLRQRILQWHUPHWDO
OLF SDUWLFOHV OHDGLQJ WR IRUPDWLRQ RI JDOYDQLF FHOOV RQ D ]LQF DQRGH FDQ FRPSURPLVH OLF SDUWLFOHV OHDGLQJ WR IRUPDWLRQ RI JDOYDQLF FHOOV RQ D ]LQF DQRGH FDQ FRPSURPLVH
WKHDQRGHHIILFLHQF\ WKHDQRGHHIILFLHQF\
,QWKH )RVURFV\VWHP *DOYDVKLHOG;3FI6HFWLRQ WKH HPEHGGHG ]LQF VOLFH LV ,QWKH )RVURFV\VWHP *DOYDVKLHOG;3FI6HFWLRQ WKH HPEHGGHG ]LQF VOLFH LV
VXSSRVHGO\ SUHYHQWHG IURP SDVVLYDWLRQ E\ XVLQJ D ³ KLJKO\ DONDOLQH FHPHQWLWLRXV VXSSRVHGO\ SUHYHQWHG IURP SDVVLYDWLRQ E\ XVLQJ D ³ KLJKO\ DONDOLQH FHPHQWLWLRXV
PRUWDU´>)RVURF@:KLOHWKLVPLJKWEHDQRSWLRQWRSUHYHQWGDPDJHDIWHUUH PRUWDU´>)RVURF@:KLOHWKLVPLJKWEHDQRSWLRQWRSUHYHQWGDPDJHDIWHUUH
SDLU HJIRUDQXPEHURI\HDUV ZHWKLQNWKDWWKHQHFHVVDU\FRQGLWLRQVDUHUDWKHUGLI SDLU HJIRUDQXPEHURI\HDUV ZHWKLQNWKDWWKHQHFHVVDU\FRQGLWLRQVDUHUDWKHUGLI
ILFXOWWRUHWDLQWKURXJKRXWFXVWRPDU\GHVLJQVHUYLFHOLYHV2QWKHRQHKDQGWKHFXU ILFXOWWRUHWDLQWKURXJKRXWFXVWRPDU\GHVLJQVHUYLFHOLYHV2QWKHRQHKDQGWKHFXU
UHQW\LHOGPLJKWEHWRRORZWREHHIILFLHQWLIWKHPRUWDULVGHQVHRQWKHRWKHUKDQG UHQW\LHOGPLJKWEHWRRORZWREHHIILFLHQWLIWKHPRUWDULVGHQVHRQWKHRWKHUKDQG
WKHQHFHVVDU\KLJKDONDOLQLW\LHDS+DERYHLVGLIILFXOWWRPDLQWDLQLQDUHODWLYHO\ WKHQHFHVVDU\KLJKDONDOLQLW\LHDS+DERYHLVGLIILFXOWWRPDLQWDLQLQDUHODWLYHO\
SRURXV PRUWDU WKDW ZRXOG DOORZ IRU VXIILFLHQW FXUUHQW \LHOG 7KHUPRG\QDPLFDOO\ WKH SRURXV PRUWDU WKDW ZRXOG DOORZ IRU VXIILFLHQW FXUUHQW \LHOG 7KHUPRG\QDPLFDOO\ WKH
V\VWHPLVHYHQPRUHFRPSOH[DVDQLQFUHDVLQJFRQFHQWUDWLRQRI]LQFZLOOLQFUHDVHWKH V\VWHPLVHYHQPRUHFRPSOH[DVDQLQFUHDVLQJFRQFHQWUDWLRQRI]LQFZLOOLQFUHDVHWKH
SDVVLYDWLRQGRPDLQRIWKH]LQFVLJQLILFDQWO\LQERWKGLUHFWLRQVVRWKDWSDVVLYDWLRQRI SDVVLYDWLRQGRPDLQRIWKH]LQFVLJQLILFDQWO\LQERWKGLUHFWLRQVVRWKDWSDVVLYDWLRQRI
]LQF FDQ DOVR EH IDYRXUHG DW KLJK S+ FI )LJXUH   0RUHRYHU FDUERQDWLRQ FDQ ]LQF FDQ DOVR EH IDYRXUHG DW KLJK S+ FI )LJXUH   0RUHRYHU FDUERQDWLRQ FDQ
ODUJHO\LQWHUIHUHZLWKWKHUHTXLUHGKLJKDONDOLQLW\ FI)LJXUH>$@ :HWKLQNWKDW ODUJHO\LQWHUIHUHZLWKWKHUHTXLUHGKLJKDONDOLQLW\ FI)LJXUH>$@ :HWKLQNWKDW
WKHVH DVSHFWV PLJKW H[SODLQ WKDW WKH OLIHWLPH RI WKH )RVURF V\VWHP LV OLPLWHG WR  WKHVH DVSHFWV PLJKW H[SODLQ WKDW WKH OLIHWLPH RI WKH )RVURF V\VWHP LV OLPLWHG WR 
\HDUV>)RVURF@ \HDUV>)RVURF@

 0DJQHVLXPDQG&RQFUHWH6WHHO6\VWHP  0DJQHVLXPDQG&RQFUHWH6WHHO6\VWHP


)URP6HFWLRQLWFDQEHFRQFOXGHGWKDWWKHSXUSRVHRILPSOHPHQWLQJPDJQHVLXP )URP6HFWLRQLWFDQEHFRQFOXGHGWKDWWKHSXUSRVHRILPSOHPHQWLQJPDJQHVLXP
LVEDVHGRQGHQVLILFDWLRQRIWKHFRQFUHWHVWHHOLQWHUIDFHZKLFKLVHVVHQWLDOIRUµ3ULQFL LVEDVHGRQGHQVLILFDWLRQRIWKHFRQFUHWHVWHHOLQWHUIDFHZKLFKLVHVVHQWLDOIRUµ3ULQFL
SOH,¶DQGLWVPDMRUFRQWULEXWLRQLQORZHULQJµ(FRUU¶ZKLFKLVFUXFLDOIRUERWKµ3ULQFL SOH,¶DQGLWVPDMRUFRQWULEXWLRQLQORZHULQJµ(FRUU¶ZKLFKLVFUXFLDOIRUERWKµ3ULQFL
SOH ,¶ DQG µ3ULQFLSOH ,,¶ ,Q DGGLWLRQ WR WKHVH EHQHILWV WKH FRPSRXQGV IRUPHG LQ WKH SOH ,¶ DQG µ3ULQFLSOH ,,¶ ,Q DGGLWLRQ WR WKHVH EHQHILWV WKH FRPSRXQGV IRUPHG LQ WKH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV

XSSHUOD\HURIWKHVXUIDFHPRGLILFDWLRQE\WKHLPSOHPHQWDWLRQSURFHVVHVXWLOLVHGIRU XSSHUOD\HURIWKHVXUIDFHPRGLILFDWLRQE\WKHLPSOHPHQWDWLRQSURFHVVHVXWLOLVHGIRU
µ3ULQFLSOH,¶SURYLGHEHQHILFLDOFRUURVLRQUHVLVWDQFHDWORZµ(FRUU¶ µ3ULQFLSOH,¶SURYLGHEHQHILFLDOFRUURVLRQUHVLVWDQFHDWORZµ(FRUU¶
,QWKLVZD\PDJQHVLXPPDLQO\FRQWULEXWHVWR%XOOHWV$DQG&FRQFHUQLQJWKHWKHUPR ,QWKLVZD\PDJQHVLXPPDLQO\FRQWULEXWHVWR%XOOHWV$DQG&FRQFHUQLQJWKHWKHUPR
G\QDPLFDSSURDFKLHFRQWURORIµ(FRUU¶DQGFRUURVLRQSURWHFWLRQE\RWKHUPHWDOV FI G\QDPLFDSSURDFKLHFRQWURORIµ(FRUU¶DQGFRUURVLRQSURWHFWLRQE\RWKHUPHWDOV FI
6HFWLRQ DVZHOODVWR%XOOHW)LHWKHVHOHFWHGNLQHWLFDSSURDFKRILPSURYLQJ 6HFWLRQ DVZHOODVWR%XOOHW)LHWKHVHOHFWHGNLQHWLFDSSURDFKRILPSURYLQJ
WKH FRQFUHWHVWHHO LQWHUIDFH FI 6HFWLRQ   %HIRUH WKH NLQHWLF DVSHFWV RI 0J DUH WKH FRQFUHWHVWHHO LQWHUIDFH FI 6HFWLRQ   %HIRUH WKH NLQHWLF DVSHFWV RI 0J DUH
GHDOWZLWKLQWKHHQGRIWKLV6HFWLRQWKHWKHUPRG\QDPLFIHDWXUHVRIPDJQHVLXPLQWKH GHDOWZLWKLQWKHHQGRIWKLV6HFWLRQWKHWKHUPRG\QDPLFIHDWXUHVRIPDJQHVLXPLQWKH
FRQFUHWHHQYLURQPHQWDUHGLVFXVVHGLQWKHIROORZLQJ FRQFUHWHHQYLURQPHQWDUHGLVFXVVHGLQWKHIROORZLQJ
7KHHIIHFWRILQFUHDVLQJ WKHPDJQHVLXPLRQDFWLYLW\LVLOOXVWUDWHGE\ µ6(3'V¶ RI WKH 7KHHIIHFWRILQFUHDVLQJ WKHPDJQHVLXPLRQDFWLYLW\LVLOOXVWUDWHGE\ µ6(3'V¶ RI WKH
0J+2V\VWHPIRUGLIIHUHQWPDJQHVLXPLRQDFWLYLWLHVLQ)LJXUH 0J+2V\VWHPIRUGLIIHUHQWPDJQHVLXPLRQDFWLYLWLHVLQ)LJXUH

 
)LJXUH 0J+2 µ6(3'V¶ EDVHG RQ 7DEOH  ZLWK GLIIHUHQW PDJQHVLXP LRQ )LJXUH 0J+2 µ6(3'V¶ EDVHG RQ 7DEOH  ZLWK GLIIHUHQW PDJQHVLXP LRQ
DFWLYLWLHV>$@0JLD íPRO/>%@0JLD íPRO/>&@0JLD  DFWLYLWLHV>$@0JLD íPRO/>%@0JLD íPRO/>&@0JLD 
PRO/ PRO/
 

7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ6(3'¶RIWKH0J+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ6(3'¶RIWKH0J+2V\VWHP

6ROLG 0J 0J2 0J 2+  6ROLG 0J 0J2 0J 2+ 


6ROXEOH 0J   6ROXEOH 0J  
 
)URP)LJXUH>$@LWFDQEHFRQFOXGHGWKDWLQFRQWUDVWWR]LQF FI)LJXUHLQ6HF )URP)LJXUH>$@LWFDQEHFRQFOXGHGWKDWLQFRQWUDVWWR]LQF FI)LJXUHLQ6HF
WLRQ PDJQHVLXPSDVVLYDWHVDWS+OHYHOVDERYHZKLFKPDNHVLWDQLQWHUHVW WLRQ PDJQHVLXPSDVVLYDWHVDWS+OHYHOVDERYHZKLFKPDNHVLWDQLQWHUHVW
LQJPHWDOWRFRPELQHZLWK]LQFIRUFRUURVLRQSURWHFWLRQLQFRQFUHWH%HVLGHVWKLVID LQJPHWDOWRFRPELQHZLWK]LQFIRUFRUURVLRQSURWHFWLRQLQFRQFUHWH%HVLGHVWKLVID
YRXUDEOHSDVVLYDWLRQGRPDLQZKLFKLQFUHDVHVWRZDUGVORZHUS+OHYHOVZLWKLQFUHDV YRXUDEOHSDVVLYDWLRQGRPDLQZKLFKLQFUHDVHVWRZDUGVORZHUS+OHYHOVZLWKLQFUHDV
LQJ LRQ DFWLYLW\ FI )LJXUH  >$@ DQG >%@  WKH HOHFWURQHJDWLYLW\ LH WKH YHU\ ORZ LQJ LRQ DFWLYLW\ FI )LJXUH  >$@ DQG >%@  WKH HOHFWURQHJDWLYLW\ LH WKH YHU\ ORZ
HTXLOLEULXPSRWHQWLDORIPDJQHVLXP LVRIPDMRULPSRUWDQFHLQRXULPSOHPHQWDWLRQRI HTXLOLEULXPSRWHQWLDORIPDJQHVLXP LVRIPDMRULPSRUWDQFHLQRXULPSOHPHQWDWLRQRI
%XOOHW$ DQGRI%XOOHW)FRQFHUQLQJHOHFWURFKHPLFDOGHQVLILFDWLRQ  %XOOHW$ DQGRI%XOOHW)FRQFHUQLQJHOHFWURFKHPLFDOGHQVLILFDWLRQ 
$VLOOXVWUDWHGLQ)LJXUHWKHHQWLUHLPPXQLW\GRPDLQRIPDJQHVLXPLVVLWXDWHGZHOO $VLOOXVWUDWHGLQ)LJXUHWKHHQWLUHLPPXQLW\GRPDLQRIPDJQHVLXPLVVLWXDWHGZHOO
EHORZWKHVWDELOLW\GRPDLQRIZDWHU7KXVPDJQHVLXPFDQEHFRQVLGHUHGWREHDYHU\ EHORZWKHVWDELOLW\GRPDLQRIZDWHU7KXVPDJQHVLXPFDQEHFRQVLGHUHGWREHDYHU\
DFWLYHPHWDODQGDSRZHUIXOUHGXFLQJDJHQW FI6HFWLRQ 0DJQHVLXPKDVDKLJK DFWLYHPHWDODQGDSRZHUIXOUHGXFLQJDJHQW FI6HFWLRQ 0DJQHVLXPKDVDKLJK
DIILQLW\WRUHDFWZLWKZDWHUZKLFKLWUHGXFHVXQGHUK\GURJHQHYROXWLRQZKHQGLVVROY DIILQLW\WRUHDFWZLWKZDWHUZKLFKLWUHGXFHVXQGHUK\GURJHQHYROXWLRQZKHQGLVVROY

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV

LQJWR0J$WS+YDOXHVDERYHIRUPDWLRQRIDPRUHRUOHVVSURWHFWLYHOD\HURI LQJWR0J$WS+YDOXHVDERYHIRUPDWLRQRIDPRUHRUOHVVSURWHFWLYHOD\HURI
PDJQHVLXPK\GUR[LGH 0J 2+  LPSHGHVWKLVGLVVROXWLRQ PDJQHVLXPK\GUR[LGH 0J 2+  LPSHGHVWKLVGLVVROXWLRQ
$VLOOXVWUDWHGLQ)LJXUH>$@WKHDGGLWLRQRIFKORULGHWRWKH0J+2V\VWHPGRHV $VLOOXVWUDWHGLQ)LJXUH>$@WKHDGGLWLRQRIFKORULGHWRWKH0J+2V\VWHPGRHV
QRWLQWHUIHUHZLWKWKHSDVVLYHGRPDLQVRI0J6LPLODUWRWKHIRUPDWLRQRI=Q&OLQWKH QRWLQWHUIHUHZLWKWKHSDVVLYHGRPDLQVRI0J6LPLODUWRWKHIRUPDWLRQRI=Q&OLQWKH
=Q&O+2µ0(3'¶ FI)LJXUH>%@DQG>&@LQ6HFWLRQ IRUPDWLRQRI0J&O =Q&O+2µ0(3'¶ FI)LJXUH>%@DQG>&@LQ6HFWLRQ IRUPDWLRQRI0J&O
LVIDYRXUHGLQWKHDVVRFLDWHGUHJLRQLQWKH0JVWDELOLW\GRPDLQRQO\ LVIDYRXUHGLQWKHDVVRFLDWHGUHJLRQLQWKH0JVWDELOLW\GRPDLQRQO\

 
)LJXUH >$@0J&O+2µ0(3'¶EDVHGRQ7DEOHZLWK0JLD íPRO/ )LJXUH >$@0J&O+2µ0(3'¶EDVHGRQ7DEOHZLWK0JLD íPRO/
DQG&OLD PRO/>%@µ6,3'¶RI>$@RQ)H&O+2µ0(3'¶EDVHG DQG&OLD PRO/>%@µ6,3'¶RI>$@RQ)H&O+2µ0(3'¶EDVHG
RQ7DEOHDQG)HLD íPRO/DQG&OLD PRO/0J&OGRPDLQ RQ7DEOHDQG)HLD íPRO/DQG&OLD PRO/0J&OGRPDLQ
LVWUDQVSDUHQWLOOXVWUDWLQJWKHRUHWLFDOFRQGLWLRQVRIFDWKRGLFSURWHFWLRQ LVWUDQVSDUHQWLOOXVWUDWLQJWKHRUHWLFDOFRQGLWLRQVRIFDWKRGLFSURWHFWLRQ
ZLWK SURWHFWLYH 0J 2+  >&@ $V >%@ EXW 0J&O DQG 0J 2+  GR ZLWK SURWHFWLYH 0J 2+  >&@ $V >%@ EXW 0J&O DQG 0J 2+  GR
PDLQV DUH WUDQVSDUHQW LOOXVWUDWLQJ WKHRUHWLFDO FRQGLWLRQV RI FDWKRGLF PDLQV DUH WUDQVSDUHQW LOOXVWUDWLQJ WKHRUHWLFDO FRQGLWLRQV RI FDWKRGLF
SURWHFWLRQZLWKQRQSURWHFWLYH0J 2+  SURWHFWLRQZLWKQRQSURWHFWLYH0J 2+ 
 

7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH0J&O+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH0J&O+2V\VWHP

6ROLG 0J 0J2 0J 2+   6ROLG 0J 0J2 0J 2+  


í í   í í 
6ROXEOH &O  &O2  0J  0J&O  6ROXEOH &O  &O2  0J  0J&O
 
,Q)LJXUH>%@DQG>&@WKHWKHRUHWLFDOFRQGLWLRQVIRUFDWKRGLFSURWHFWLRQRILURQLQ ,Q)LJXUH>%@DQG>&@WKHWKHRUHWLFDOFRQGLWLRQVIRUFDWKRGLFSURWHFWLRQRILURQLQ
WKHFKORULGHHQYLURQPHQWDUHLOOXVWUDWHG2QWKHDFFRXQWRILWVHOHFWURQHJDWLYHQDWXUH WKHFKORULGHHQYLURQPHQWDUHLOOXVWUDWHG2QWKHDFFRXQWRILWVHOHFWURQHJDWLYHQDWXUH
PDJQHVLXPLVJHQHUDOO\FRQVLGHUHGWRDVDVXLWDEOHDQRGHIRUVDFULILFLDOSURWHFWLRQRI PDJQHVLXPLVJHQHUDOO\FRQVLGHUHGWRDVDVXLWDEOHDQRGHIRUVDFULILFLDOSURWHFWLRQRI
LURQDQGRWKHUPHWDOV7KHFRXSOLQJRIPDJQHVLXPZLWKDPHWDOPRUHQREOHWKDQLWVHOI LURQDQGRWKHUPHWDOV7KHFRXSOLQJRIPDJQHVLXPZLWKDPHWDOPRUHQREOHWKDQLWVHOI
JHQHUDOO\HQDEOHVWKHµ(FRUU¶RIWKLVPHWDOWREHUHGXFHGWRDYDOXHEHORZWKHµ(¶RILWV JHQHUDOO\HQDEOHVWKHµ(FRUU¶RIWKLVPHWDOWREHUHGXFHGWRDYDOXHEHORZWKHµ(¶RILWV
FRUURVLRQ UHDFWLRQ 7KXV WKH JDOYDQLFDOO\ FRQQHFWHG PHWDO FDQ EH UHQGHUHG FRP FRUURVLRQ UHDFWLRQ 7KXV WKH JDOYDQLFDOO\ FRQQHFWHG PHWDO FDQ EH UHQGHUHG FRP
SOHWHO\ LPPXQH WR FRUURVLRQ FI 6HFWLRQ   $V IRU ]LQF WKHDQRGHHIILFLHQF\RI SOHWHO\ LPPXQH WR FRUURVLRQ FI 6HFWLRQ   $V IRU ]LQF WKHDQRGHHIILFLHQF\RI
PDJQHVLXP DQG DOVR WKDW RI LWV DOOR\V  LV FORVHO\ FRQQHFWHGWRWKHFKDUDFWHULVWLFVRI PDJQHVLXP DQG DOVR WKDW RI LWV DOOR\V  LV FORVHO\ FRQQHFWHGWRWKHFKDUDFWHULVWLFVRI
WKHSDVVLYHOD\HU7KHFRQGLWLRQVIRULWVIRUPDWLRQGHSHQGRQWKHQDWXUHRIWKHVROXWLRQ WKHSDVVLYHOD\HU7KHFRQGLWLRQVIRULWVIRUPDWLRQGHSHQGRQWKHQDWXUHRIWKHVROXWLRQ
DQGRQWKHQDWXUHRIWKHLPSXULWLHVRIWKHPHWDO DQGRQWKHQDWXUHRIWKHDOOR\HGHOH DQGRQWKHQDWXUHRIWKHLPSXULWLHVRIWKHPHWDO DQGRQWKHQDWXUHRIWKHDOOR\HGHOH
PHQWV  PHQWV 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV

)LJXUH>%@DQG>&@UHSUHVHQWWKHWKHRUHWLFDOFRQGLWLRQVIRUFDWKRGLFSURWHFWLRQRI )LJXUH>%@DQG>&@UHSUHVHQWWKHWKHRUHWLFDOFRQGLWLRQVIRUFDWKRGLFSURWHFWLRQRI
LURQE\PHDQVRIPDJQHVLXPFRQVLGHULQJIRUPDWLRQRISURWHFWLYHDQGQRQSURWHFWLYH LURQE\PHDQVRIPDJQHVLXPFRQVLGHULQJIRUPDWLRQRISURWHFWLYHDQGQRQSURWHFWLYH
0J 2+  UHVSHFWLYHO\ ,QGXVWULDOO\ HPSOR\HG EDFNILOOV IRU FDWKRGLF SURWHFWLRQ E\ 0J 2+  UHVSHFWLYHO\ ,QGXVWULDOO\ HPSOR\HG EDFNILOOV IRU FDWKRGLF SURWHFWLRQ E\
PDJQHVLXPKDYHWKHSULPDU\REMHFWLYHRISURPRWLQJIRUPDWLRQRIQRQSURWHFWLYHK\ PDJQHVLXPKDYHWKHSULPDU\REMHFWLYHRISURPRWLQJIRUPDWLRQRIQRQSURWHFWLYHK\
GUR[LGH>3RXUEDL[D3RXUEDL[E@'XHWRK\GURJHQHYROXWLRQWKHFXUUHQW GUR[LGH>3RXUEDL[D3RXUEDL[E@'XHWRK\GURJHQHYROXWLRQWKHFXUUHQW
\LHOG DW PDJQHVLXP DQRGHV UDUHO\ H[FHHGV  WR  RI WKH WKHRUHWLFDO \LHOG$F \LHOG DW PDJQHVLXP DQRGHV UDUHO\ H[FHHGV  WR  RI WKH WKHRUHWLFDO \LHOG$F
FRUGLQJ WR >3RXUEDL[ D 3RXUEDL[ E@ WKH FXUUHQW \LHOG RI PDJQHVLXP DQ FRUGLQJ WR >3RXUEDL[ D 3RXUEDL[ E@ WKH FXUUHQW \LHOG RI PDJQHVLXP DQ
RGHV FDQ EH LPSURYHG E\ VXUURXQGLQJ WKHP ZLWK D VSHFLDO FKHPLFDO HQFDSVXODWLRQ RGHV FDQ EH LPSURYHG E\ VXUURXQGLQJ WKHP ZLWK D VSHFLDO FKHPLFDO HQFDSVXODWLRQ
XVXDOO\DPL[WXUHRIJ\SVXPDQGFOD\ RUE\DOOR\LQJWKHPDJQHVLXPZLWKDOXPLQLXP XVXDOO\DPL[WXUHRIJ\SVXPDQGFOD\ RUE\DOOR\LQJWKHPDJQHVLXPZLWKDOXPLQLXP
]LQFRUPDQJDQHVH ]LQFRUPDQJDQHVH
7KHSURSRUWLRQLQJRI0J=QDQGDGGLWLRQDOFRPSRXQGVLQFRPELQDWLRQZLWKWDLORUHG 7KHSURSRUWLRQLQJRI0J=QDQGDGGLWLRQDOFRPSRXQGVLQFRPELQDWLRQZLWKWDLORUHG
LPSOHPHQWDWLRQ SURFHVVHV HQDEOH WKH GHVFULEHG EHQHILFLDO WKHUPRG\QDPLF HIIHFWV RI LPSOHPHQWDWLRQ SURFHVVHV HQDEOH WKH GHVFULEHG EHQHILFLDO WKHUPRG\QDPLF HIIHFWV RI
0J LQ WKH FRQFUHWH HQYLURQPHQW ZLWKRXW SURGXFLQJ H[FHVVLYH DPRXQWV RI K\GURJHQ 0J LQ WKH FRQFUHWH HQYLURQPHQW ZLWKRXW SURGXFLQJ H[FHVVLYH DPRXQWV RI K\GURJHQ
7KHVHDVSHFWVDUHFHQWUDOLQWKHGHYHORSPHQWEXWDUHQRWGHVFULEHGLQGHWDLOZLWKUH 7KHVHDVSHFWVDUHFHQWUDOLQWKHGHYHORSPHQWEXWDUHQRWGHVFULEHGLQGHWDLOZLWKUH
JDUGWRWKHH[SHFWHGSDWHQWSRVVLELOLWLHV FI6HFWLRQ  JDUGWRWKHH[SHFWHGSDWHQWSRVVLELOLWLHV FI6HFWLRQ 
$QH[DPSOHIRUWKHLPSRUWDQFHRISURSHUSURSRUWLRQLQJDQGLPSOHPHQWDWLRQLVJLYHQ $QH[DPSOHIRUWKHLPSRUWDQFHRISURSHUSURSRUWLRQLQJDQGLPSOHPHQWDWLRQLVJLYHQ
E\WKHWKHUPRG\QDPLFLQFRPSDWLELOLW\RIPDJQHVLXPZLWKWKHFRQFUHWHVWHHOV\VWHP E\WKHWKHUPRG\QDPLFLQFRPSDWLELOLW\RIPDJQHVLXPZLWKWKHFRQFUHWHVWHHOV\VWHP
7KHLQFRPSDWLELOLW\ZDVH[SHULPHQWDOO\YHULILHGDVVKRZQLQ)LJXUH 7KHLQFRPSDWLELOLW\ZDVH[SHULPHQWDOO\YHULILHGDVVKRZQLQ)LJXUH

 
)LJXUH 6HOHFWHGH[SHULPHQWVFRQFHUQLQJWKHLQWHUIHUHQFHRIFDOFLXPFDUERQDWH )LJXUH 6HOHFWHGH[SHULPHQWVFRQFHUQLQJWKHLQWHUIHUHQFHRIFDOFLXPFDUERQDWH
ZLWKIRUPDWLRQ RI PDJQHVLXP K\GUR[LGH>$@5HEDUVDPSOHSUHSDUHG ZLWKIRUPDWLRQ RI PDJQHVLXP K\GUR[LGH >$@5HEDUVDPSOHSUHSDUHG
LQFRUUHVSRQGHQFHZLWKFHPHQWSDVWHVSHFLPHQV FI6HFWLRQ DQG LQFRUUHVSRQGHQFHZLWKFHPHQWSDVWHVSHFLPHQV FI6HFWLRQ DQG
PDJQHVLXP ZLUH >(7  (7 @ KDPPHUHG LQ JURYHV EHIRUH PDJQHVLXP ZLUH >(7  (7 @ KDPPHUHG LQ JURYHV EHIRUH
JULWEODVWLQJ>%@5HEDUVDPSOHFRUUHVSRQGLQJWR>$@DIWHUGLSFRDWLQJ JULWEODVWLQJ>%@5HEDUVDPSOHFRUUHVSRQGLQJWR>$@DIWHUGLSFRDWLQJ
LQ FHPHQW SDVWH FI 6HFWLRQ  DQG 6HFWLRQ   >&@ 5HEDU LQ FHPHQW SDVWH FI 6HFWLRQ  DQG 6HFWLRQ   >&@ 5HEDU
VDPSOHFRUUHVSRQGLQJWR>$@VXEPHUVHGLQVDWXUDWHGFDOFLXPK\GUR[ VDPSOHFRUUHVSRQGLQJWR>$@VXEPHUVHGLQVDWXUDWHGFDOFLXPK\GUR[
LGHVROXWLRQDQGFRQQHFWHGWRDGGLWLRQDOPDJQHVLXPZLUHVDPSOH LGHVROXWLRQDQGFRQQHFWHGWRDGGLWLRQDOPDJQHVLXPZLUHVDPSOH

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV

$V GLVFXVVHG LQ WKH DERYH DQG LOOXVWUDWHG LQ )LJXUH  PDJQHVLXP VKRXOG KDYH D $V GLVFXVVHG LQ WKH DERYH DQG LOOXVWUDWHG LQ )LJXUH  PDJQHVLXP VKRXOG KDYH D
VWURQJWKHUPRG\QDPLFWHQGHQF\WRSDVVLYDWHDWDQ\µ(FRUU¶LQ 3RUWODQG FHPHQWSDVWH VWURQJWKHUPRG\QDPLFWHQGHQF\WRSDVVLYDWHDWDQ\µ(FRUU¶LQ 3RUWODQG FHPHQWSDVWH
FI6HFWLRQ DVZHOODVLQVDWXUDWHG&D 2+ VROXWLRQ S+ +RZHYHU FI6HFWLRQ DVZHOODVLQVDWXUDWHG&D 2+  VROXWLRQ S+   +RZHYHU
)LJXUH  LQGLFDWHV WKDW WKH PDJQHVLXP ZLUHV HPEHGGHG LQ D FDUERQ VWHHO VDPSOH )LJXUH  LQGLFDWHV WKDW WKH PDJQHVLXP ZLUHV HPEHGGHG LQ D FDUERQ VWHHO VDPSOH
FI)LJXUH>$@ GRQHLWKHUSDVVLYDWHLQFHPHQWSDVWH FI)LJXUH>%@ QRULQ FI)LJXUH>$@ GRQHLWKHUSDVVLYDWHLQFHPHQWSDVWH FI)LJXUH>%@ QRULQ
VDWXUDWHG&D 2+ VROXWLRQ FI)LJXUH>&@  VDWXUDWHG&D 2+ VROXWLRQ FI)LJXUH>&@ 
7KH VDPSOH VKRZQ LQ )LJXUH  >$@ ZDV SUHSDUHG LQ WKH VDPH ZD\ DV WKH JULW 7KH VDPSOH VKRZQ LQ )LJXUH  >$@ ZDV SUHSDUHG LQ WKH VDPH ZD\ DV WKH JULW
EODVWHGVDPSOH FI³&´LQ6HFWLRQ EXWEHIRUHJULWEODVWLQJIRXUPPZLGH EODVWHGVDPSOH FI³&´LQ6HFWLRQ EXWEHIRUHJULWEODVWLQJIRXUPPZLGH
DQGGHHSORQJLWXGLQDOJURRYHVZHUHVDZQZLWKGLVWDQFHVRIƒDQGPDJQHVLXPZLUH DQGGHHSORQJLWXGLQDOJURRYHVZHUHVDZQZLWKGLVWDQFHVRIƒDQGPDJQHVLXPZLUH
>(7(7@ZLWKDWKLFNQHVVRIPPZDVKDPPHUHGLQWRWKHVHJURRYHV >(7(7@ZLWKDWKLFNQHVVRIPPZDVKDPPHUHGLQWRWKHVHJURRYHV
:KHQ WKHVH VDPSOHV ZHUH GLSFRDWHG LQ FHPHQW SDVWH RU VXEPHUVHG LQ VDWXUDWHG :KHQ WKHVH VDPSOHV ZHUH GLSFRDWHG LQ FHPHQW SDVWH RU VXEPHUVHG LQ VDWXUDWHG
&D 2+  VROXWLRQ D VWURQJ DQG ORQJODVWLQJ K\GURJHQ HYROXWLRQ FRXOG EH REVHUYHG &D 2+  VROXWLRQ D VWURQJ DQG ORQJODVWLQJ K\GURJHQ HYROXWLRQ FRXOG EH REVHUYHG
7KHFRUURVLRQUHDFWLRQODVWHGXQWLODFRQVLGHUDEOHDPRXQWRIWKHPDJQHVLXPZLUHZDV 7KHFRUURVLRQUHDFWLRQODVWHGXQWLODFRQVLGHUDEOHDPRXQWRIWKHPDJQHVLXPZLUHZDV
FRQVXPHGZKLFKLVLQGLFDWHGE\WKHEXEEOHV IRUPHGDORQJWKH ZLUHVLQ )LJXUH FRQVXPHGZKLFKLVLQGLFDWHGE\WKHEXEEOHV IRUPHGDORQJWKH ZLUHV LQ )LJXUH
>%@DQGWKHEXEEOHVJDWKHULQJDURXQGWKHVSHFLPHQLQ)LJXUH>&@7KHFRUURVLRQ >%@DQGWKHEXEEOHVJDWKHULQJDURXQGWKHVSHFLPHQLQ)LJXUH>&@7KHFRUURVLRQ
UHDFWLRQZDVRQO\LPSHGHGDIWHUVHYHUDOKRXUVE\IRUPDWLRQRIDEODFNVPXGJHRQWKH UHDFWLRQZDVRQO\LPSHGHGDIWHUVHYHUDOKRXUVE\IRUPDWLRQRIDEODFNVPXGJHRQWKH
VXUIDFH VXUIDFH
7KHSHUIRUPDQFHRIWKLVUHEDUVDPSOHLQFHPHQWSDVWHDQGVDWXUDWHG&D 2+ VROXWLRQ 7KHSHUIRUPDQFHRIWKLVUHEDUVDPSOHLQFHPHQWSDVWHDQGVDWXUDWHG&D 2+ VROXWLRQ
ZDVFRPSDUHGWRVXEPHUVLRQLQRWKHUDONDOLQHPHGLDDWFRPSDUDEOHS+OHYHOVDVHJ ZDVFRPSDUHGWRVXEPHUVLRQLQRWKHUDONDOLQHPHGLDDWFRPSDUDEOHS+OHYHOVDVHJ
VDWXUDWHG VRGLXP K\GUR[LGH 1D2+  0RUHRYHU PDJQHVLXP ZLUH ZDV WHVWHG DORQH VDWXUDWHG VRGLXP K\GUR[LGH 1D2+  0RUHRYHU PDJQHVLXP ZLUH ZDV WHVWHG DORQH
ZLWKDQGZLWKRXWJULWEODVWLQJDQGZLWKDQGZLWKRXWJDOYDQLFFRQQHFWLRQWRWKHUHEDU ZLWKDQGZLWKRXWJULWEODVWLQJDQGZLWKDQGZLWKRXWJDOYDQLFFRQQHFWLRQWRWKHUHEDU
VDPSOH LQ VDWXUDWHG &D 2+  DQG VDWXUDWHG 1D2+ VROXWLRQV 7KH IROORZLQJ ZDV RE VDPSOH LQ VDWXUDWHG &D 2+  DQG VDWXUDWHG 1D2+ VROXWLRQV 7KH IROORZLQJ ZDV RE
VHUYHG VHUYHG
‡ 3HUIHFWSDVVLYDWLRQZLWKRXWYLVLEOHK\GURJHQHYROXWLRQRQDOOVDPSOHVVXEPHUVHG ‡ 3HUIHFWSDVVLYDWLRQZLWKRXWYLVLEOHK\GURJHQHYROXWLRQRQDOOVDPSOHVVXEPHUVHG
LQ1D2+VROXWLRQ LQ1D2+VROXWLRQ
‡ 9HU\OLWWOHK\GURJHQHYROXWLRQRQ0JZLUHZLWKRXWJULWEODVWLQJDQGZLWKRXWFRQ ‡ 9HU\OLWWOHK\GURJHQHYROXWLRQRQ0JZLUHZLWKRXWJULWEODVWLQJDQGZLWKRXWFRQ
QHFWLRQWRWKHUHEDUVDPSOHLQ&D 2+ VROXWLRQ QHFWLRQWRWKHUHEDUVDPSOHLQ&D 2+ VROXWLRQ
‡ /LWWOHK\GURJHQHYROXWLRQRQ0JZLUHZLWKJULWEODVWLQJDQGZLWKRXWFRQQHFWLRQWR ‡ /LWWOHK\GURJHQHYROXWLRQRQ0JZLUHZLWKJULWEODVWLQJDQGZLWKRXWFRQQHFWLRQWR
WKHUHEDUVDPSOHLQ&D 2+ VROXWLRQ WKHUHEDUVDPSOHLQ&D 2+ VROXWLRQ
‡ 0HGLXP K\GURJHQ HYROXWLRQRQ0JZLUHZLWKRXWJULWEODVWLQJDQG FRQQHFWLRQ WR ‡ 0HGLXPK\GURJHQ HYROXWLRQRQ0JZLUHZLWKRXWJULWEODVWLQJDQG FRQQHFWLRQ WR
WKHUHEDUVDPSOHLQ&D 2+ VROXWLRQ WKHUHEDUVDPSOHLQ&D 2+ VROXWLRQ
‡ 6WURQJ K\GURJHQ HYROXWLRQ RQ 0J ZLUH ZLWK JULWEODVWLQJ DQG FRQQHFWLRQ WR WKH ‡ 6WURQJ K\GURJHQ HYROXWLRQ RQ 0J ZLUH ZLWK JULWEODVWLQJ DQG FRQQHFWLRQ WR WKH
UHEDUVDPSOHLQ&D 2+ VROXWLRQ UHEDUVDPSOHLQ&D 2+ VROXWLRQ
+HQFHZHSRVWXODWHWKDWWKHµ(FRUU¶WKHSUHVHQFHRIFDOFLXPDQGWKHVXUIDFHFRQGLWLRQ +HQFHZHSRVWXODWHWKDWWKHµ(FRUU¶WKHSUHVHQFHRIFDOFLXPDQGWKHVXUIDFHFRQGLWLRQ
RIPDJQHVLXPKDYHDVLJQLILFDQWHIIHFWRQWKHEHKDYLRXURIPDJQHVLXPLQFRQFUHWH,Q RIPDJQHVLXPKDYHDVLJQLILFDQWHIIHFWRQWKHEHKDYLRXURIPDJQHVLXPLQFRQFUHWH,Q
WKHIROORZLQJWKLVREVHUYDWLRQLVUHDVRQHGDVDQLQWHUIHUHQFHEHWZHHQFDOFLXPFDUERQ WKHIROORZLQJWKLVREVHUYDWLRQLVUHDVRQHGDVDQLQWHUIHUHQFHEHWZHHQFDOFLXPFDUERQ
DWH &D&2  DQGWKHIRUPDWLRQRISDVVLYH0J 2+ ,WLVDOVRVKRZQWKDWGHVSLWHWKH DWH &D&2  DQGWKHIRUPDWLRQRISDVVLYH0J 2+ ,WLVDOVRVKRZQWKDWGHVSLWHWKH
SURSRVHG WKHUPRG\QDPLF LQFRPSDWLELOLW\ WKHUPRG\QDPLFV FDQ DGYDQWDJHRXVO\ EH SURSRVHG WKHUPRG\QDPLF LQFRPSDWLELOLW\ WKHUPRG\QDPLFV FDQ DGYDQWDJHRXVO\ EH
DSSOLHG LQ FRPELQDWLRQ ZLWK H[SHULPHQWDO LQYHVWLJDWLRQV SDUWLFXODUO\ PHDVXUHPHQWV DSSOLHG LQ FRPELQDWLRQ ZLWK H[SHULPHQWDO LQYHVWLJDWLRQV SDUWLFXODUO\ PHDVXUHPHQWV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV

RIµ(FRUU¶ DQGµ('6¶ FI6HFWLRQ WRLQYHVWLJDWH DQGSUHGLFWSRVVLEOHLQWHUIHU RIµ(FRUU¶ DQGµ('6¶ FI6HFWLRQ WRLQYHVWLJDWH DQGSUHGLFWSRVVLEOHLQWHUIHU
HQFHV HQFHV
7KURXJKRXW 6HFWLRQV  FDUERQDWLRQ   FDOFLWH  DQG  FDOFLXP K\ 7KURXJKRXW 6HFWLRQV  FDUERQDWLRQ   FDOFLWH  DQG  FDOFLXP K\
GUR[\]LQFDWH LWZDVVKRZQWKDWFDOFLXPLVDFHQWUDOFRPSRXQGLQFRQFUHWH:LWKUH GUR[\]LQFDWH LWZDVVKRZQWKDWFDOFLXPLVDFHQWUDOFRPSRXQGLQFRQFUHWH:LWKUH
JDUGWRFDUERQDWLRQLWZDVPHQWLRQHGWKDWFDOFLXPK\GUR[LGHUHDFWVPRVWUHDGLO\ZLWK JDUGWRFDUERQDWLRQLWZDVPHQWLRQHGWKDWFDOFLXPK\GUR[LGHUHDFWVPRVWUHDGLO\ZLWK
&2 FI6HFWLRQ  &2 FI6HFWLRQ 

&2   &D ( 2+ ) → &D&2 +  2 ( Δ* 


= −  N- )  >@ &2   &D ( 2+ ) → &D&2 +  2 ( Δ* 
= −  N- )  >@

7KH &D0J&+2 DQG WKH 0J&D&+2 V\VWHP DUH UHSUHVHQWHG E\ WKH DVVRFLDWHG 7KH &D0J&+2 DQG WKH 0J&D&+2 V\VWHP DUH UHSUHVHQWHG E\ WKH DVVRFLDWHG
µ0(3'V¶LQ)LJXUH>$@DQG>%@WRHVWDEOLVKWKHWKHUPRG\QDPLFEDFNJURXQG RI µ0(3'V¶LQ)LJXUH>$@DQG>%@WRHVWDEOLVKWKHWKHUPRG\QDPLFEDFNJURXQG RI
WKH SURSRVHG PHFKDQLVP )LJXUH  >&@ WR >'@ LOOXVWUDWH WKH HVVHQWLDO VWHSV LQ WKH WKH SURSRVHG PHFKDQLVP )LJXUH  >&@ WR >'@ LOOXVWUDWH WKH HVVHQWLDO VWHSV LQ WKH
SURSRVHGLQWHUIHUHQFHEHWZHHQ&D&2DQGIRUPDWLRQRI0J 2+  SURSRVHGLQWHUIHUHQFHEHWZHHQ&D&2DQGIRUPDWLRQRI0J 2+ 

 
)LJXUH 3URSRVHGPHFKDQLVPIRUWKHLQWHUIHUHQFHRIFDOFLXPFDUERQDWHDQGWKH )LJXUH 3URSRVHGPHFKDQLVPIRUWKHLQWHUIHUHQFHRIFDOFLXPFDUERQDWHDQGWKH
IRUPDWLRQ RI PDJQHVLXP K\GUR[LGH >$@ &D0J&+2 µ0(3'¶ IRUPDWLRQ RI PDJQHVLXP K\GUR[LGH >$@ &D0J&+2 µ0(3'¶
EDVHGRQ7DEOHZLWK&DLD íPRO/0JLD íPRO/DQG&LD EDVHGRQ7DEOHZLWK&DLD íPRO/0JLD íPRO/DQG&LD
íPRO/>%@0J&D&+2µ0(3'¶ZLWKSUHVHOHFWLRQDQG0JLD íPRO/>%@0J&D&+2µ0(3'¶ZLWKSUHVHOHFWLRQDQG0JLD
&DLDDQG&LDDVLQ>$@>&@WR>(@6NHWFKHVRIWKHSURSRVHGPHFKDQLVP &DLDDQG&LDDVLQ>$@>&@WR>(@6NHWFKHVRIWKHSURSRVHGPHFKDQLVP
IRUWKHLQIHUHQFHRIFDOFLXPFDUERQDWHDQGWKHIRUPDWLRQRIPDJQHVLXP IRUWKHLQIHUHQFHRIFDOFLXPFDUERQDWHDQGWKHIRUPDWLRQRIPDJQHVLXP
K\GUR[LGH K\GUR[LGH
 

7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH&D0J&V\VWHPDQGWKH0J 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH&D0J&V\VWHPDQGWKH0J


&D&+2V\VWHP  &D&+2V\VWHP 

& &D &D&2 &D0J &2  &D2 & &D &D&2 &D0J &2  &D2
6ROLG 6ROLG
&D2 &D 2+  0J 0J2 0J 2+  &D2 &D 2+  0J 0J2 0J 2+ 
  í í    í í
6ROXEOH &D  &D 2+  &2  +&2  0J  6ROXEOH &D  &D 2+  &2  +&2  0J

 

7KHPRVWQRWDEOHFKDQJHIURPWKH&D+2V\VWHPSRVWXODWHGLQ>3RXUEDL[E@LVWKDWPDJQHVLXP 7KHPRVWQRWDEOHFKDQJHIURPWKH&D+2V\VWHPSRVWXODWHGLQ>3RXUEDL[E@LVWKDWPDJQHVLXP
K\GULGH &D+ LVQRWLQFOXGHGLQWKHSUHVHOHFWLRQRIHOHPHQWVDVLWLVFRQVLGHUHGWREHXQVWDEOHLQWKH K\GULGH &D+ LVQRWLQFOXGHGLQWKHSUHVHOHFWLRQRIHOHPHQWVDVLWLVFRQVLGHUHGWREHXQVWDEOHLQWKH
SUHVHQFHRIZDWHU SUHVHQFHRIZDWHU

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV

)RUERWKH[SRVXUHVLWXDWLRQVVKRZQLQ)LJXUH>%@DQG>&@&2LVDYDLODEOHIURP )RUERWKH[SRVXUHVLWXDWLRQVVKRZQLQ)LJXUH>%@DQG>&@&2LVDYDLODEOHIURP
WKH DWPRVSKHUH DQG ZH DVVXPH WKDW HYHQ VPDOO DPRXQWV HQDEOH WKH IRUPDWLRQ RI WKH DWPRVSKHUH DQG ZH DVVXPH WKDW HYHQ VPDOO DPRXQWV HQDEOH WKH IRUPDWLRQ RI
&D&2+RZHYHUZHH[SHFWWKHVLPLODULQWHUIHUHQFHVWRWDNHSODFHLQDEVHQFHRI&2 &D&2+RZHYHUZHH[SHFWWKHVLPLODULQWHUIHUHQFHVWRWDNHSODFHLQDEVHQFHRI&2
HJEDVHGRQUHDFWLRQV ZLWKWKHYDULRXVFDOFLXPFRPSRXQGVLQFRQFUHWH FI6HFWLRQ HJEDVHGRQUHDFWLRQV ZLWKWKHYDULRXVFDOFLXPFRPSRXQGVLQFRQFUHWH FI6HFWLRQ
   
:KLOHZHUHJDUGWKHIRUPDWLRQRIFDOFLXPFRPSRXQGVWREHIDYRXUDEOHIRUWKHH[WHQW :KLOHZHUHJDUGWKHIRUPDWLRQRIFDOFLXPFRPSRXQGVWREHIDYRXUDEOHIRUWKHH[WHQW
RISDVVLYHGRPDLQVIRUVWHHO FI6HFWLRQ DQG]LQF FI6HFWLRQ ZHWKLQN RISDVVLYHGRPDLQVIRUVWHHO FI6HFWLRQ DQG]LQF FI6HFWLRQ ZHWKLQN
WKDWWKLVGRHVQRWDSSO\IRUPDJQHVLXP)RUERWKH[SRVXUHVLWXDWLRQVVKRZQLQ)LJXUH WKDWWKLVGRHVQRWDSSO\IRUPDJQHVLXP)RUERWKH[SRVXUHVLWXDWLRQVVKRZQLQ)LJXUH
>%@DQG>&@ZHDVVXPHWKDW&D&2ZLOOGHSRVLWRQWKH0JRUWKH0J 2+ VXU >%@DQG>&@ZHDVVXPHWKDW&D&2ZLOOGHSRVLWRQWKH0JRUWKH0J 2+ VXU
IDFH<HWLQFRQWUDVWWRVWHHODQG]LQFLWLQKLELWVWKHIRUPDWLRQRIDSDVVLYHOD\HU$V IDFH<HWLQFRQWUDVWWRVWHHODQG]LQFLWLQKLELWVWKHIRUPDWLRQRIDSDVVLYHOD\HU$V
LQGLFDWHGLQ)LJXUH>'@ZHDVVXPHWKDW&D&2GHSRVLWVRQWKH0JRUWKH LPSHU LQGLFDWHGLQ)LJXUH>'@ZHDVVXPHWKDW&D&2GHSRVLWVRQWKH0JRUWKH LPSHU
IHFW 0J 2+ VXUIDFHZKLFKUHVXOWVLQVPDOOFUDFNV0J 2+ LVIRUPHGDWWKHVDPH IHFW 0J 2+ VXUIDFHZKLFKUHVXOWVLQVPDOOFUDFNV0J 2+ LVIRUPHGDWWKHVDPH
WLPH EXW &D&2 ZLOO EH LQWHJUDWHG LQ WKH OD\HU OHDGLQJ WR FRQVLGHUDEOH GHIHFWV HJ WLPH EXW &D&2 ZLOO EH LQWHJUDWHG LQ WKH OD\HU OHDGLQJ WR FRQVLGHUDEOH GHIHFWV HJ
GXHWRVWUHVVUHOHDVHVHH)LJXUH>(@$WWKHVHGHIHFWVK\GURJHQHYROXWLRQFDQEH GXHWRVWUHVVUHOHDVHVHH)LJXUH>(@$WWKHVHGHIHFWVK\GURJHQHYROXWLRQFDQEH
H[SUHVVHGE\WKHVXPRIR[LGDWLRQRI0JWR0J 2+  H[SUHVVHGE\WKHVXPRIR[LGDWLRQRI0JWR0J 2+ 

0J  2+ − → 0J 2+  H − (( 
 −  P96+( )  >@ 0J  2+ − → 0J 2+  H − (( 
 −  P96+( )  >@

DQGWKHUHGXFWLRQRIZDWHULQQHXWUDODQGDONDOLQHVROXWLRQV FI>@  DQGWKHUHGXFWLRQRIZDWHULQQHXWUDODQGDONDOLQHVROXWLRQV FI>@ 

+  2 + H − → +  + 2+ − (( 
 = −  ^−` P96+( )  >@ +  2 + H − → +  + 2+ − (( 
 = −  ^−` P96+( )  >@

7KHVHUHDFWLRQVSHUVLVWVLQFHWKHLQWHUIHUHQFHRI&D&2KLQGHUVWKHIRUPDWLRQRIPH 7KHVHUHDFWLRQVSHUVLVWVLQFHWKHLQWHUIHUHQFHRI&D&2KLQGHUVWKHIRUPDWLRQRIPH
FKDQLFDOVWDEOH0J 2+ OD\HU:KHQWKH0JZLUHZDVQRWJDOYDQLFDOO\FRQQHFWHGWR FKDQLFDOVWDEOH0J 2+ OD\HU:KHQWKH0JZLUHZDVQRWJDOYDQLFDOO\FRQQHFWHGWR
WKHUHEDU0J 2+ FRXOGEHIRUPHGZLWKYHU\OLWWOHRUOLWWOHK\GURJHQHYROXWLRQEH WKHUHEDU0J 2+ FRXOGEHIRUPHGZLWKYHU\OLWWOHRUOLWWOHK\GURJHQHYROXWLRQEH
FDXVH&D&2 FRXOG QRWEH IRUPHG DW ORZ µ(FRUU¶ FI )LJXUH  >$@  6R WKH ZRUVW FDXVH&D&2 FRXOG QRWEH IRUPHG DW ORZ µ(FRUU¶ FI )LJXUH  >$@  6R WKH ZRUVW
LQWHUIHUHQFHWDNHVSODFHLIWKHWRSRIWKHOD\HULVDWDSRWHQWLDOZKLFKIDYRXUVSUHFLSL LQWHUIHUHQFHWDNHVSODFHLIWKHWRSRIWKHOD\HULVDWDSRWHQWLDOZKLFKIDYRXUVSUHFLSL
WDWLRQ RI &D&2 7KH VDPH KROGVIRUFDVHVZKHUHWKHVXUIDFHDUHDLVVPDOODQG LQL WDWLRQRI&D&2 7KH VDPH KROGV IRU FDVHV ZKHUH WKH VXUIDFH DUHD LV VPDOODQG LQL
WLDOO\SDVVLYHDVIRU0JZLUHVWKDWZHUHQRWJULWEODVWHG WLDOO\SDVVLYHDVIRU0JZLUHVWKDWZHUHQRWJULWEODVWHG
7KH DERYH WKHRUHWLFDOO\ UHDVRQHG PHFKDQLVP ZDV FRQILUPHG E\ µ6(0¶ DQG µ('6¶ 7KH DERYH WKHRUHWLFDOO\ UHDVRQHG PHFKDQLVP ZDV FRQILUPHG E\ µ6(0¶ DQG µ('6¶
REVHUYDWLRQV7KHGHVFULEHG VWUHVVUHOHDVH FUDFNLQJDQGWKHEODFNVPXGJHZKLFKZH REVHUYDWLRQV7KHGHVFULEHG VWUHVVUHOHDVH FUDFNLQJDQGWKHEODFNVPXGJHZKLFKZH
DVVXPHWRUHSUHVHQWWKHLQWHUPHWDOOLFFRPSRXQGVIRUPHGEHWZHHQ0JDQG)HFDQEH DVVXPHWRUHSUHVHQWWKHLQWHUPHWDOOLFFRPSRXQGVIRUPHGEHWZHHQ0JDQG)HFDQEH
FOHDUO\ REVHUYHG LQ WKH VHFRQGDU\ HOHFWURQ DQG EDFNVFDWWHUHG µ6(0¶ SKRWRJUDSKV FOHDUO\ REVHUYHG LQ WKH VHFRQGDU\ HOHFWURQ DQG EDFNVFDWWHUHG µ6(0¶ SKRWRJUDSKV
VKRZQLQ)LJXUH>$@DQG>%@UHVSHFWLYHO\ VKRZQLQ)LJXUH>$@DQG>%@UHVSHFWLYHO\

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV

 
)LJXUH 6FDQQLQJ HOHFWURQ PLFURVFRS\ RI JULWEODVWHG PDJQHVLXP ZLUH DIWHU )LJXUH 6FDQQLQJ HOHFWURQ PLFURVFRS\ RI JULWEODVWHG PDJQHVLXP ZLUH DIWHU
VXEPHUVLRQ LQ VDWXUDWHG FDOFLXP K\GUR[LGH VROXWLRQ >$@ 6HFRQGDU\ VXEPHUVLRQ LQ VDWXUDWHG FDOFLXP K\GUR[LGH VROXWLRQ >$@ 6HFRQGDU\
HOHFWURQ>%@%DFNVFDWWHUHG HOHFWURQ>%@%DFNVFDWWHUHG
7KHSUHVHQFHRIERWKFDUERQDQGFDOFLXPLQWKHVPXGJHOD\HUZDVYHULILHGE\µ('6¶ 7KHSUHVHQFHRIERWKFDUERQDQGFDOFLXPLQWKHVPXGJHOD\HUZDVYHULILHGE\µ('6¶
PDSSLQJ FI6HFWLRQ>('$;)(,@ VHH)LJXUH7KHDVVRFL PDSSLQJ FI6HFWLRQ>('$;)(,@ VHH)LJXUH7KHDVVRFL
DWHGµ('6¶VSHFWUXPLVVKRZQ)LJXUH DWHGµ('6¶VSHFWUXPLVVKRZQ)LJXUH

 
)LJXUH 0DSSLQJRIHOHPHQWVEDVHGRQHQHUJ\GLVSHUVLYHVSHFWURVFRS\RIDUHD )LJXUH 0DSSLQJRIHOHPHQWVEDVHGRQHQHUJ\GLVSHUVLYHVSHFWURVFRS\RIDUHD
VKRZQ LQ )LJXUH  >$@ &DUERQ >%@ &DOFLXP >&@ 0DJQHVLXP VKRZQ LQ )LJXUH  >$@ &DUERQ >%@ &DOFLXP >&@ 0DJQHVLXP
>'@2[\JHQ >'@2[\JHQ
 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 0DWHULDOV&RQFHSWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV

 
)LJXUH (QHUJ\ GLVSHUVLYH VSHFWUD IRU WKH LQYHVWLJDWHG DUHD DQG HOHPHQWV RI )LJXUH (QHUJ\ GLVSHUVLYH VSHFWUD IRU WKH LQYHVWLJDWHG DUHD DQG HOHPHQWV RI
)LJXUHVSHFLI\LQJWKHDVVRFLDWHG;UD\HQHUJLHVRQWKH;D[LVDQG )LJXUHVSHFLI\LQJWKHDVVRFLDWHG;UD\HQHUJLHVRQWKH;D[LVDQG
WKHUHODWLYH;UD\FRXQWVRQWKH<D[LV WKHUHODWLYH;UD\FRXQWVRQWKH<D[LV
,QDGGLWLRQWRWKHYLVXDODSSHDUDQFHZHWKLQNWKDWWKHSUHVHQFHDQGDPRXQWRIFDOFLXP ,QDGGLWLRQWRWKHYLVXDODSSHDUDQFHZHWKLQNWKDWWKHSUHVHQFHDQGDPRXQWRIFDOFLXP
FI)LJXUH)LJXUHDQG)LJXUH LQWKHVPXGJHOD\HULVDSRVLWLYHLQGLFD FI)LJXUH)LJXUHDQG)LJXUH LQWKHVPXGJHOD\HULVDSRVLWLYHLQGLFD
WRUIRUWKHSRVWXODWHGPHFKDQLVP WRUIRUWKHSRVWXODWHGPHFKDQLVP
$VLOOXVWUDWHGE\WKHVWDELOLW\GRPDLQRIFDOFLXPFDUERQDWHWKHFULWLFDOUHJLRQH[WHQGV $VLOOXVWUDWHGE\WKHVWDELOLW\GRPDLQRIFDOFLXPFDUERQDWHWKHFULWLFDOUHJLRQH[WHQGV
WKURXJKRXWWKHWKHRUHWLFDOZDWHUVWDELOLW\GRPDLQIRUDONDOLQHVROXWLRQV7KXVWKHLQ WKURXJKRXWWKHWKHRUHWLFDOZDWHUVWDELOLW\GRPDLQIRUDONDOLQHVROXWLRQV7KXVWKHLQ
WHUIHUHQFH RI &D&2ZLWKWKHIRUPDWLRQRIDSDVVLYH0J 2+ OD\HUDQGWKHDVVRFL WHUIHUHQFH RI &D&2ZLWKWKHIRUPDWLRQRIDSDVVLYH0J 2+  OD\HU DQG WKHDVVRFL
DWHGK\GURJHQHYROXWLRQDUHRIPDMRULPSRUWDQFH DWHGK\GURJHQHYROXWLRQDUHRIPDMRULPSRUWDQFH
%HVLGHVWKHWKHUPRG\QDPLFDVSHFWVRIPDJQHVLXPIRUERWKµ3ULQFLSOH,¶DQGµ3ULQFLSOH %HVLGHVWKHWKHUPRG\QDPLFDVSHFWVRIPDJQHVLXPIRUERWKµ3ULQFLSOH,¶DQGµ3ULQFLSOH
,,¶LWVNLQHWLFHIIHFWLHDVLJQLILFDQWLPSURYHPHQWRIWKHFRQFUHWHVWHHOLQWHUIDFH FI ,,¶LWVNLQHWLFHIIHFWLHDVLJQLILFDQWLPSURYHPHQWRIWKHFRQFUHWHVWHHOLQWHUIDFH FI
%XOOHW ) LQ 6HFWLRQ   SOD\ D PDMRU UROH IRU µ3ULQFLSOH ,¶ FRXQWHUPHDVXUHV 7KH %XOOHW ) LQ 6HFWLRQ   SOD\ D PDMRU UROH IRU µ3ULQFLSOH ,¶ FRXQWHUPHDVXUHV 7KH
FRQFUHWHVWHHOLQWHUIDFHLPSURYHPHQWLVGHVLJQHGWREHREWDLQHGLQWZRZD\VE\HOHF FRQFUHWHVWHHOLQWHUIDFHLPSURYHPHQWLVGHVLJQHGWREHREWDLQHGLQWZRZD\VE\HOHF
WURFKHPLFDOGHQVLILFDWLRQDVZHOODVE\SRUHEORFNLQJWKURXJKSUHFLSLWDWLRQRIPDJQH WURFKHPLFDOGHQVLILFDWLRQDVZHOODVE\SRUHEORFNLQJWKURXJKSUHFLSLWDWLRQRIPDJQH
VLXP FRPSRXQGV ,Q )LJXUH  LQ 6HFWLRQ  LW ZDV LQGLFDWHG WKDW DFFRUGLQJ WR VLXP FRPSRXQGV ,Q )LJXUH  LQ 6HFWLRQ  LW ZDV LQGLFDWHG WKDW DFFRUGLQJ WR
>%XHQIHOGHWDO@WKHFKORULGHWKUHVKROGFRXOGEHPRUHWKDQWULSOHG IURP >%XHQIHOGHWDO@WKHFKORULGHWKUHVKROGFRXOGEHPRUHWKDQWULSOHG IURP
µZZFH¶WRDURXQGµZZFH¶ DWDYRLGFRQWHQWRIDERXW E\ DVSHFLDOHOHFWUR µZZFH¶WRDURXQGµZZFH¶ DWDYRLGFRQWHQWRIDERXW E\ DVSHFLDOHOHFWUR
FKHPLFDOWUHDWPHQWGXULQJWKHILUVWGD\VDIWHUFDVWLQJ FI6HFWLRQ   :H WKLQN FKHPLFDOWUHDWPHQWGXULQJWKHILUVWGD\VDIWHUFDVWLQJ FI6HFWLRQ   :H WKLQN
WKDWWKHPDLQHIIHFWRIWKHGHVFULEHGHOHFWURFKHPLFDOWUHDWPHQWLVREWDLQHGE\WKHWDU WKDWWKHPDLQHIIHFWRIWKHGHVFULEHGHOHFWURFKHPLFDOWUHDWPHQWLVREWDLQHGE\WKHWDU
JHWHGFDWKRGLFSRODULVDWLRQGXULQJ VHWWLQJ RI WKH FRQFUHWH LHE\KROGLQJWKHFDUERQ JHWHGFDWKRGLFSRODULVDWLRQGXULQJ VHWWLQJ RI WKH FRQFUHWH LHE\ KROGLQJ WKHFDUERQ
VWHHOUHLQIRUFHPHQWDWDURXQGíP96+(IRUWKHILUVWKRXUVDIWHUFDVWLQJ VWHHOUHLQIRUFHPHQWDWDURXQGíP96+(IRUWKHILUVWKRXUVDIWHUFDVWLQJ
,QDGGLWLRQWRHOHFWURFKHPLFDOGHQVLILFDWLRQSRUHEORFNLQJWKURXJKSURGXFWVIURPWKH ,QDGGLWLRQWRHOHFWURFKHPLFDOGHQVLILFDWLRQSRUHEORFNLQJWKURXJKSURGXFWVIURPWKH
FHPHQW SDVWH FI 6HFWLRQ   DQG WKH SRUH VROXWLRQ FI 6HFWLRQ   FRPELQLQJ FHPHQW SDVWH FI 6HFWLRQ   DQG WKH SRUH VROXWLRQ FI 6HFWLRQ   FRPELQLQJ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV ,PSOHPHQWDWLRQDQG6WUXFWXUDO$SSOLFDWLRQV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV ,PSOHPHQWDWLRQDQG6WUXFWXUDO$SSOLFDWLRQV

ZLWK PDJQHVLXP  SOD\V DQ LPSRUWDQW UROH IRU µ3ULQFLSOH ,¶ 7KH VWDELOLW\ GRPDLQ RI ZLWK PDJQHVLXP  SOD\V DQ LPSRUWDQW UROH IRU µ3ULQFLSOH ,¶ 7KH VWDELOLW\ GRPDLQ RI
FDOFLXP PDJQHVLXP FDUERQDWH GRORPLWH &D0J &2   LV LQGLFDWHG LQ )LJXUH  FDOFLXP PDJQHVLXP FDUERQDWH GRORPLWH &D0J &2   LV LQGLFDWHG LQ )LJXUH 
>$@ DQG >%@ $PRQJ RWKHU PLQHUDOV IRUPHG XQGHU WKLV FRQGLWLRQV >0LQ'DW  >$@ DQG >%@ $PRQJ RWKHU PLQHUDOV IRUPHG XQGHU WKLV FRQGLWLRQV >0LQ'DW 
0LQ*DO:HE0LQ@ZHFRQVLGHUWKHFRQWULEXWLRQRIGRORPLWHWREHPRVW 0LQ*DO:HE0LQ@ZHFRQVLGHUWKHFRQWULEXWLRQRIGRORPLWHWREHPRVW
LPSRUWDQWLQVHDOLQJSRUHV FI6HFWLRQ DQGFUDFNVLQWKHPLFURWRLQWHUPHGLDWH LPSRUWDQWLQVHDOLQJSRUHV FI6HFWLRQ DQGFUDFNVLQWKHPLFURWRLQWHUPHGLDWH
UDQJH FI7DEOHLQ6HFWLRQ  UDQJH FI7DEOHLQ6HFWLRQ 
7KHEHQHILWV RI WKH REWDLQHG LQWHUIDFH GHQVLILFDWLRQ LQ FRPELQDWLRQZLWKWKHWKHUPR 7KHEHQHILWV RI WKH REWDLQHG LQWHUIDFH GHQVLILFDWLRQ LQ FRPELQDWLRQZLWKWKHWKHUPR
G\QDPLFDVSHFWVUHDOLVHGE\WKHLPSOHPHQWDWLRQRI]LQF FI6HFWLRQ DQGPDJQH G\QDPLFDVSHFWVUHDOLVHGE\WKHLPSOHPHQWDWLRQRI]LQF FI6HFWLRQ DQGPDJQH
VLXPDUHWKHFHQWUDODVSHFWVRIRXUSURSRVHGQHZFRXQWHUPHDVXUHV6HOHFWHGLQGLFDWLYH VLXPDUHWKHFHQWUDODVSHFWVRIRXUSURSRVHGQHZFRXQWHUPHDVXUHV6HOHFWHGLQGLFDWLYH
LQIRUPDWLRQRQWKHLPSOHPHQWDWLRQRIWZRGLIIHUHQWSULQFLSOHVRILPSOHPHQWDWLRQDQG LQIRUPDWLRQRQWKHLPSOHPHQWDWLRQRIWZRGLIIHUHQWSULQFLSOHVRILPSOHPHQWDWLRQDQG
WKHLULQWHQGHGDSSOLFDWLRQRQDVWUXFWXUDOVFDOHDUHJLYHQLQ6HFWLRQ WKHLULQWHQGHGDSSOLFDWLRQRQDVWUXFWXUDOVFDOHDUHJLYHQLQ6HFWLRQ

 ,PSOHPHQWDWLRQDQG6WUXFWXUDO$SSOLFDWLRQV  ,PSOHPHQWDWLRQDQG6WUXFWXUDO$SSOLFDWLRQV


,Q 6HFWLRQV  DQG  WKH WKHUPRG\QDPLF DQG NLQHWLF DSSURDFKHV IRU RXU SUR ,Q 6HFWLRQV  DQG  WKH WKHUPRG\QDPLF DQG NLQHWLF DSSURDFKHV IRU RXU SUR
SRVHGQHZFRXQWHUPHDVXUHVZHUHGLVFXVVHGDQGUHDVRQHG7KHWZRSULQFLSOHVRILP SRVHGQHZFRXQWHUPHDVXUHVZHUHGLVFXVVHGDQGUHDVRQHG7KHWZRSULQFLSOHVRILP
SOHPHQWDWLRQ IRU WKH UHDOLVDWLRQ ZHUH VXPPDULVHG LQ 6HFWLRQ  DQG WKH PRVW LP SOHPHQWDWLRQ IRU WKH UHDOLVDWLRQ ZHUH VXPPDULVHG LQ 6HFWLRQ  DQG WKH PRVW LP
SRUWDQWIHDWXUHVRIWKHPDWHULDOVFRQFHSWVZHUHLQWURGXFHGLQ6HFWLRQ'XHWRWKH SRUWDQWIHDWXUHVRIWKHPDWHULDOVFRQFHSWVZHUHLQWURGXFHGLQ6HFWLRQ'XHWRWKH
H[SHFWHG SDWHQW SRVVLELOLWLHV FI 6HFWLRQ   GHWDLOHG LQIRUPDWLRQ RQ WKH SURFHVVHV H[SHFWHG SDWHQW SRVVLELOLWLHV FI 6HFWLRQ   GHWDLOHG LQIRUPDWLRQ RQ WKH SURFHVVHV
GHVLJQHG IRU WKH SURGXFWLRQ DQG LPSOHPHQWDWLRQ RI WKH FRXQWHUPHDVXUHV LV QRW SUR GHVLJQHG IRU WKH SURGXFWLRQ DQG LPSOHPHQWDWLRQ RI WKH FRXQWHUPHDVXUHV LV QRW SUR
YLGHGLQWKHSUHVHQWWKHVLV+RZHYHUDQLQGLFDWLYHRXWOLQHRIWKHLPSOHPHQWDWLRQDQG YLGHGLQWKHSUHVHQWWKHVLV+RZHYHUDQLQGLFDWLYHRXWOLQHRIWKHLPSOHPHQWDWLRQDQG
SRVVLEOHVWUXFWXUDODSSOLFDWLRQVLVJLYHQ SRVVLEOHVWUXFWXUDODSSOLFDWLRQVLVJLYHQ
7KHGHVLJQIHDWXUHVLHWKHLPSOHPHQWDWLRQRIWKHPDWHULDOVFRQFHSWVIRUWKHUHDOLVD 7KHGHVLJQIHDWXUHVLHWKHLPSOHPHQWDWLRQRIWKHPDWHULDOVFRQFHSWVIRUWKHUHDOLVD
WLRQRIWKHWKHUPRG\QDPLFDQGNLQHWLFDSSURDFKHVLQFOXGH WLRQRIWKHWKHUPRG\QDPLFDQGNLQHWLFDSSURDFKHVLQFOXGH
‡ )RUERWKµ3ULQFLSOH,¶DQGµ3ULQFLSOH,,¶ ‡ )RUERWKµ3ULQFLSOH,¶DQGµ3ULQFLSOH,,¶
ƕ 3URSHUSURSRUWLRQLQJRI ]LQFDQGPDJQHVLXPDQGVXLWDEOHSURFHVVHV IRU WKHLU ƕ 3URSHUSURSRUWLRQLQJRI ]LQFDQGPDJQHVLXPDQGVXLWDEOHSURFHVVHV IRU WKHLU
LPSOHPHQWDWLRQLQFRPELQDWLRQZLWKDGGLWLRQDOPDWHULDOVDOORZIRURSHUDWLRQDW LPSOHPHQWDWLRQLQFRPELQDWLRQZLWKDGGLWLRQDOPDWHULDOVDOORZIRURSHUDWLRQDW
DWDUJHWHGORZµ(FRUU¶ FI%XOOHW$LQ6HFWLRQ  DWDUJHWHGORZµ(FRUU¶ FI%XOOHW$LQ6HFWLRQ 
ƕ 7KHSURFHVVHVGHVLJQHGIRUWKHLPSOHPHQWDWLRQRIWKHSULQFLSDOPDWHULDOVFRQ ƕ 7KHSURFHVVHVGHVLJQHGIRUWKHLPSOHPHQWDWLRQRIWKHSULQFLSDOPDWHULDOVFRQ
FHSWV FI 6HFWLRQ   DOORZ IRU FRQWUROOLQJ WKH WKHUPRG\QDPLF VWDWH 7KLV FHSWV FI 6HFWLRQ   DOORZ IRU FRQWUROOLQJ WKH WKHUPRG\QDPLF VWDWH 7KLV
PHDQV DPRQJ RWKHUV WKDW SDVVLYDWLRQ RI WKH LPSOHPHQWHG PDWHULDOV LV ³DFWL PHDQV DPRQJ RWKHUV WKDW SDVVLYDWLRQ RI WKH LPSOHPHQWHG PDWHULDOV LV ³DFWL
YDWHG´DQG³GHDFWLYDWHG´DVUHTXLUHG0RUHRYHUXQGHVLUHGHIIHFWVHJWKHLQ YDWHG´DQG³GHDFWLYDWHG´DVUHTXLUHG0RUHRYHUXQGHVLUHGHIIHFWVHJWKHLQ
WHUIHUHQFHEHWZHHQ&D&2DQGIRUPDWLRQRI0J 2+  FI6HFWLRQ DUH WHUIHUHQFHEHWZHHQ&D&2DQGIRUPDWLRQRI0J 2+  FI6HFWLRQ DUH
FRQWUROOHG FRQWUROOHG

 

,QFRQFUHWHWHFKQRORJ\LWLVZHOONQRZQWKDWPDJQHVLXPHIIHFWLYHO\VHDOVVXUIDFHSRUHVLIFRQFUHWHLV ,QFRQFUHWHWHFKQRORJ\LWLVZHOONQRZQWKDWPDJQHVLXPHIIHFWLYHO\VHDOVVXUIDFHSRUHVLIFRQFUHWHLV
H[SRVHGWRVROXWLRQVFRQWDLQLQJPDJQHVLXPHJVHDZDWHU$PRQJRWKHUVWKLVVKRZVWKDWDOVRIRU H[SRVHGWRVROXWLRQVFRQWDLQLQJPDJQHVLXPHJVHDZDWHU$PRQJRWKHUVWKLVVKRZVWKDWDOVRIRU
FRQFUHWH DVIRUVWHHO H[SRVXUHWRFKORULGHVROXWLRQGLIIHUVIURPH[SRVXUHWRDFWXDOVHDZDWHU ZLWKWKH FRQFUHWH DVIRUVWHHO H[SRVXUHWRFKORULGHVROXWLRQGLIIHUVIURPH[SRVXUHWRDFWXDOVHDZDWHU ZLWKWKH
VDPHFKORULGHFRQWHQW FIFRUURVLRQSURSHUWLHVRIVWHHOLQFKORULGHVROXWLRQDQGVHDZDWHU FI6HFWLRQ VDPHFKORULGHFRQWHQW FIFRUURVLRQSURSHUWLHVRIVWHHOLQFKORULGHVROXWLRQDQGVHDZDWHU FI6HFWLRQ
   

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


,PSOHPHQWDWLRQDQG6WUXFWXUDO$SSOLFDWLRQV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV ,PSOHPHQWDWLRQDQG6WUXFWXUDO$SSOLFDWLRQV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV

ƕ /RZ FRQVXPSWLRQ UDWH DQG ³RQ GHPDQG´ FRQVXPSWLRQ SURYLGH IRU ORQJWHUP ƕ /RZ FRQVXPSWLRQ UDWH DQG ³RQ GHPDQG´ FRQVXPSWLRQ SURYLGH IRU ORQJWHUP
UHOLDELOLW\DQGHIILFLHQF\ZKLOHWKHV\VWHPLVYLUWXDOO\IUHHRIPDLQWHQDQFH UHOLDELOLW\DQGHIILFLHQF\ZKLOHWKHV\VWHPLVYLUWXDOO\IUHHRIPDLQWHQDQFH
‡ )RUµ3ULQFLSOH,¶LHFRXQWHUPHDVXUHVEDVHGRQVXUIDFHPRGLILFDWLRQV ‡ )RUµ3ULQFLSOH,¶LHFRXQWHUPHDVXUHVEDVHGRQVXUIDFHPRGLILFDWLRQV
7KHGHVLUHGµ3ULQFLSOH,¶SURSHUWLHVLQGLFDWHGLQ6HFWLRQDUHDFFRPSOLVKHGE\ 7KHGHVLUHGµ3ULQFLSOH,¶SURSHUWLHVLQGLFDWHGLQ6HFWLRQDUHDFFRPSOLVKHGE\
FXVWRPGHVLJQHGSURFHVVHVWRREWDLQDOD\HUHGVXUIDFHPRGLILFDWLRQ7KHPRGLILHG FXVWRPGHVLJQHGSURFHVVHVWRREWDLQDOD\HUHGVXUIDFHPRGLILFDWLRQ7KHPRGLILHG
UHLQIRUFHPHQWVXUIDFHLV]LQFULFKRQWKHLQVLGHLHDWWKHUHEDULQWHUIDFHDQGKDV UHLQIRUFHPHQWVXUIDFHLV]LQFULFKRQWKHLQVLGHLHDWWKHUHEDULQWHUIDFHDQGKDV
KLJKPDJQHVLXPFRQWHQWDWWKHRXWVLGHLHDWWKHFRQFUHWHLQWHUIDFH%DVHGRQWKLV KLJKPDJQHVLXPFRQWHQWDWWKHRXWVLGHLHDWWKHFRQFUHWHLQWHUIDFH%DVHGRQWKLV
DSSURDFKWKHIROORZLQJIHDWXUHVDUHREWDLQHG DSSURDFKWKHIROORZLQJIHDWXUHVDUHREWDLQHG
ƕ 7KHPDJQHVLXPLQWKHWRSOD\HUSDVVLYDWHVWKHRXWHUSHULPHWHURIWKHVXUIDFH ƕ 7KHPDJQHVLXPLQWKHWRSOD\HUSDVVLYDWHVWKHRXWHUSHULPHWHURIWKHVXUIDFH
PRGLILFDWLRQGXULQJDQGDIWHUFDVWLQJ FI6HFWLRQ DQGWKXVSURWHFWVWKH PRGLILFDWLRQGXULQJDQGDIWHUFDVWLQJ FI6HFWLRQ DQGWKXVSURWHFWVWKH
]LQFULFKLQVLGHOD\HUIURPLQLWLDOGLVVROXWLRQ=LQFUHPDLQVFORVHWRWKHUHEDU ]LQFULFKLQVLGHOD\HUIURPLQLWLDOGLVVROXWLRQ=LQFUHPDLQVFORVHWRWKHUHEDU
SURYLGLQJFRUURVLRQSURWHFWLRQE\IRUPDWLRQRIFRPSRXQGVZLWKLPSURYHGFRU SURYLGLQJFRUURVLRQSURWHFWLRQE\IRUPDWLRQRIFRPSRXQGVZLWKLPSURYHGFRU
URVLRQUHVLVWDQFHLQFRPELQDWLRQZLWKWKHFDUERQVWHHOVXUIDFHLH]LQFIHUULWH URVLRQUHVLVWDQFHLQFRPELQDWLRQZLWKWKHFDUERQVWHHOVXUIDFHLH]LQFIHUULWH
FI%XOOHW%LQ6HFWLRQDQG6HFWLRQ 7KLVVSHFLDOIHDWXUHRIµ3ULQ FI%XOOHW%LQ6HFWLRQDQG6HFWLRQ 7KLVVSHFLDOIHDWXUHRIµ3ULQ
FLSOH,¶LVIXUWKHUHODERUDWHGEDVHGRQ)LJXUHDQG)LJXUHVXEVHTXHQW FLSOH,¶LVIXUWKHUHODERUDWHGEDVHGRQ)LJXUHDQG)LJXUHVXEVHTXHQW
WRWKLVOLVW WRWKLVOLVW
ƕ 7KH WDUJHWHG µ(FRUU¶ REWDLQHG E\ WKH WKHUPRG\QDPLFDOO\ VWDEOH FRPSRXQGV DW ƕ 7KH WDUJHWHG µ(FRUU¶ REWDLQHG E\ WKH WKHUPRG\QDPLFDOO\ VWDEOH FRPSRXQGV DW
WKH RXWHU SHULPHWHU RI WKH VXUIDFH PRGLILFDWLRQ UHSHOV FKORULGH LRQV DQG SUR WKH RXWHU SHULPHWHU RI WKH VXUIDFH PRGLILFDWLRQ UHSHOV FKORULGH LRQV DQG SUR
YLGHVIRUDQµ(FRUU¶UDQJHZKLFKLVZHOOEHORZWKHFKORULGHSLWWLQJSRWHQWLDOVRI YLGHVIRUDQµ(FRUU¶UDQJHZKLFKLVZHOOEHORZWKHFKORULGHSLWWLQJSRWHQWLDOVRI
WKH DVVRFLDWHG FRPSRXQGV LQ DONDOLQH FRQFUHWH 7KLV PHDVXUH FRUUHVSRQGV WR WKH DVVRFLDWHG FRPSRXQGV LQ DONDOLQH FRQFUHWH 7KLV PHDVXUH FRUUHVSRQGV WR
SURWHFWLRQRIWKH)H+2V\VWHPE\PHWDOVZLWKLPSURYHGFRUURVLRQUHVLVWDQFH SURWHFWLRQRIWKH)H+2V\VWHPE\PHWDOVZLWKLPSURYHGFRUURVLRQUHVLVWDQFH
FI%XOOHW&LQ6HFWLRQDQG6HFWLRQ  FI%XOOHW&LQ6HFWLRQDQG6HFWLRQ 
ƕ $Q LQLWLDO DQG PRVW VLJQLILFDQW  LPSURYHPHQW RI WKH FRQFUHWHVWHHO LQWHUIDFH ƕ $Q LQLWLDO DQG PRVW VLJQLILFDQW  LPSURYHPHQW RI WKH FRQFUHWHVWHHO LQWHUIDFH
FI%XOOHW)LQ6HFWLRQ LVDFKLHYHGE\HOHFWURFKHPLFDOGHQVLILFDWLRQGXH FI%XOOHW)LQ6HFWLRQ LVDFKLHYHGE\HOHFWURFKHPLFDOGHQVLILFDWLRQGXH
WR WKH WDUJHWHG ORZ µ(FRUU¶ GXULQJ VHWWLQJ RI WKH FRQFUHWH FI 6HFWLRQV  WR WKH WDUJHWHG ORZ µ(FRUU¶ GXULQJ VHWWLQJ RI WKH FRQFUHWH FI 6HFWLRQV 
DQG  DQG 
ƕ ,QFDVHRIDS+GURSGXHWRFDUERQDWLRQRULQFDVHRIFUDFNIRUPDWLRQ LQ WKH ƕ ,QFDVHRIDS+GURSGXHWRFDUERQDWLRQRULQFDVHRIFUDFNIRUPDWLRQLQWKH
FRQFUHWH EXON PDJQHVLXP LV GLVVROYHG IURP WKH RXWHU SHULPHWHU DQG SUHFLSL FRQFUHWH EXON PDJQHVLXP LV GLVVROYHG IURP WKH RXWHU SHULPHWHU DQG SUHFLSL
WDWHV LQ WKH LPPHGLDWH YLFLQLW\ WR IRUP GRORPLWH ZKLFK OHDGV WRDVHFRQGDU\ WDWHV LQ WKH LPPHGLDWH YLFLQLW\ WR IRUP GRORPLWH ZKLFK OHDGV WRDVHFRQGDU\
GHQVLILFDWLRQDWWKHFRQFUHWHVWHHOLQWHUIDFH FI6HFWLRQ :LWKLQWKHGHQ GHQVLILFDWLRQDWWKHFRQFUHWHVWHHOLQWHUIDFH FI6HFWLRQ :LWKLQWKHGHQ
VLILHGDUHD]LQFIHUULWHHIIHFWLYHO\SURWHFWVWKHXQGHUO\LQJFDUERQVWHHOZLWKOLW VLILHGDUHD]LQFIHUULWHHIIHFWLYHO\SURWHFWVWKHXQGHUO\LQJFDUERQVWHHOZLWKOLW
WOHWRQRWHQGHQF\RIRXWZDUGVGLIIXVLRQ FI6HFWLRQ 7KHDVVRFLDWHGUH WOHWRQRWHQGHQF\RIRXWZDUGVGLIIXVLRQ FI6HFWLRQ 7KHDVVRFLDWHGUH
JLRQVDUHDGGLWLRQDOO\FDWKRGLFDOO\SRODULVHGE\WKHDFWLYDWHGPDJQHVLXPFRP JLRQVDUHDGGLWLRQDOO\FDWKRGLFDOO\SRODULVHGE\WKHDFWLYDWHGPDJQHVLXPFRP
SRXQGV FI)LJXUHDQG)LJXUHVXEVHTXHQWWRWKLVOLVW  SRXQGV FI)LJXUHDQG)LJXUHVXEVHTXHQWWRWKLVOLVW 
ƕ :KHUH WKH VXUIDFH PRGLILFDWLRQ LV GLVFRQWLQXHG LH DW DQ XQLQWHQGHG RU LQ ƕ :KHUH WKH VXUIDFH PRGLILFDWLRQ LV GLVFRQWLQXHG LH DW DQ XQLQWHQGHG RU LQ
GXFHG HJ FXWRIIV  GHIHFW WKH H[SRVHG FDUERQ VWHHO VXUIDFH LV FDWKRGLFDOO\ GXFHG HJ FXWRIIV  GHIHFW WKH H[SRVHG FDUERQ VWHHO VXUIDFH LV FDWKRGLFDOO\
SURWHFWHG E\ WKH DFWLYDWHG PDJQHVLXP FRPSRXQGV FI 6HFWLRQ   DQGRU SURWHFWHG E\ WKH DFWLYDWHG PDJQHVLXP FRPSRXQGV FI 6HFWLRQ   DQGRU
WKH]LQFIHUULWH FI6HFWLRQ LQWKHYLFLQLW\RIWKHGHIHFW WKH]LQFIHUULWH FI6HFWLRQ LQWKHYLFLQLW\RIWKHGHIHFW
‡ )RUµ3ULQFLSOH,,¶LHFRXQWHUPHDVXUHVEDVHGRQHPEHGGHGHOHFWURGHV ‡ )RUµ3ULQFLSOH,,¶LHFRXQWHUPHDVXUHVEDVHGRQHPEHGGHGHOHFWURGHV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV ,PSOHPHQWDWLRQDQG6WUXFWXUDO$SSOLFDWLRQV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV ,PSOHPHQWDWLRQDQG6WUXFWXUDO$SSOLFDWLRQV

)RUWKHSUDFWLFDOUHDOLVDWLRQRIWKHLQWHQGHGµ3ULQFLSOH,,¶IHDWXUHVLQGLFDWHGLQ6HF )RUWKHSUDFWLFDOUHDOLVDWLRQRIWKHLQWHQGHGµ3ULQFLSOH,,¶IHDWXUHVLQGLFDWHGLQ6HF
WLRQWZRGLVVLPLODUSURFHVVHVIRUWKHLPSOHPHQWDWLRQRIWKHPDWHULDOFRQFHSWV WLRQWZRGLVVLPLODUSURFHVVHVIRUWKHLPSOHPHQWDWLRQRIWKHPDWHULDOFRQFHSWV
LQWURGXFHG LQ 6HFWLRQ  DUH SUHVHQWO\ XQGHU FRQVLGHUDWLRQ %RWK RSWLRQV DUH LQWURGXFHG LQ 6HFWLRQ  DUH SUHVHQWO\ XQGHU FRQVLGHUDWLRQ %RWK RSWLRQV DUH
EDVHG RQ HPEHGGHG VDFULILFLDO DQRGHV SURYLGLQJ IRU HIILFLHQW FDWKRGLF SURWHFWLRQ EDVHG RQ HPEHGGHG VDFULILFLDO DQRGHV SURYLGLQJ IRU HIILFLHQW FDWKRGLF SURWHFWLRQ
FI%XOOHW$LQ6HFWLRQ 7KHILUVWRSWLRQUHODWHVWRDGRSHGPHWDODSSURDFK FI%XOOHW$LQ6HFWLRQ 7KHILUVWRSWLRQUHODWHVWRDGRSHGPHWDODSSURDFK
ZKLOH WKH VHFRQG RSWLRQ LV EDVHG RQ FRPELQLQJ SURFHVVHG ]LQF DQG PDJQHVLXP ZKLOH WKH VHFRQG RSWLRQ LV EDVHG RQ FRPELQLQJ SURFHVVHG ]LQF DQG PDJQHVLXP
FRPSRXQGVLQDQHOHFWURFKHPLFDODFWLYHSRURXVHQFDSVXODWLRQ7KHPRVWLPSRU FRPSRXQGVLQDQHOHFWURFKHPLFDODFWLYHSRURXVHQFDSVXODWLRQ7KHPRVWLPSRU
WDQWDVSHFWVDQGIHDWXUHVRIERWKRSWLRQVLQFOXGH WDQWDVSHFWVDQGIHDWXUHVRIERWKRSWLRQVLQFOXGH
ƕ $SURFHVVIRUWKHLPSOHPHQWDWLRQLQWKHPDWHULDOVFRQFHSWGHVLJQHGLQDZD\ ƕ $SURFHVVIRUWKHLPSOHPHQWDWLRQLQWKHPDWHULDOVFRQFHSWGHVLJQHGLQDZD\
VRWKDWWKHVDFULILFLDODQRGHFDQSURYLGHHIILFLHQWWDUJHWHGFDWKRGLFSRODULVDWLRQ VRWKDWWKHVDFULILFLDODQRGHFDQSURYLGHHIILFLHQWWDUJHWHGFDWKRGLFSRODULVDWLRQ
DW DQ\ WLPH DIWHU WKH VHW RI FRQFUHWH  7KH SULQFLSDO PDWHULDOV FRQFHSWV FI DW DQ\ WLPH DIWHU WKH VHW RI FRQFUHWH  7KH SULQFLSDO PDWHULDOV FRQFHSWV FI
6HFWLRQ DUHSURSRUWLRQHGDQGFRPELQHGZLWKVHFRQGDU\FRPSRXQGVLQWKH 6HFWLRQ DUHSURSRUWLRQHGDQGFRPELQHGZLWKVHFRQGDU\FRPSRXQGVLQWKH
SURGXFWLRQ SURFHVV VR WKDW VXIILFLHQW FXUUHQW \LHOG LV DYDLODEOH DQG HOHFWUR SURGXFWLRQ SURFHVV VR WKDW VXIILFLHQW FXUUHQW \LHOG LV DYDLODEOH DQG HOHFWUR
FKHPLFDOLQHIILFLHQFLHVHJGXHWRK\GURJHQHYROXWLRQDWORFDOFDWKRGHVLP FKHPLFDOLQHIILFLHQFLHVHJGXHWRK\GURJHQHYROXWLRQDWORFDOFDWKRGHVLP
SXULWLHV RU XQGHVLUHG VXUIDFH FKHPLVWU\ FKDQJHV FI 6HFWLRQ   DUH SUH SXULWLHV RU XQGHVLUHG VXUIDFH FKHPLVWU\ FKDQJHV FI 6HFWLRQ   DUH SUH
YHQWHG YHQWHG
ƕ ,QLWLDOGHQVLILFDWLRQRIWKHHOHFWURGHFRQFUHWHLQWHUIDFHLVRPLWWHGE\DVSHFLDO ƕ ,QLWLDOGHQVLILFDWLRQRIWKHHOHFWURGHFRQFUHWHLQWHUIDFHLVRPLWWHGE\DVSHFLDO
VXUIDFHWUHDWPHQWRIWKHVDFULILFLDODQRGHVWRDOORZIRUDKLJKFXUUHQW\LHOG VXUIDFHWUHDWPHQWRIWKHVDFULILFLDODQRGHVWRDOORZIRUDKLJKFXUUHQW\LHOG
ƕ 6HFRQGDU\GHQVLILFDWLRQE\SUHFLSLWDWLRQRIGLVVROYHGPDJQHVLXPLVOLPLWHGE\ ƕ 6HFRQGDU\GHQVLILFDWLRQE\SUHFLSLWDWLRQRIGLVVROYHGPDJQHVLXPLVOLPLWHGE\
PHDQVRIWKHVSHFLDOPDWHULDOVFRQFHSW PHDQVRIWKHVSHFLDOPDWHULDOVFRQFHSW
%DVHGRQWKHDERYHLWFDQEHFRQFOXGHGWKDWERWKSULQFLSOHVRILPSOHPHQWDWLRQODUJHO\ %DVHGRQWKHDERYHLWFDQEHFRQFOXGHGWKDWERWKSULQFLSOHVRILPSOHPHQWDWLRQODUJHO\
EHQHILWIURPWKHWDUJHWHGµ(FRUU¶REWDLQHGE\WKHFXVWRPLVHGSURFHVVHVIRU WKHLPSOH EHQHILWIURPWKHWDUJHWHGµ(FRUU¶REWDLQHGE\WKHFXVWRPLVHGSURFHVVHVIRU WKHLPSOH
PHQWDWLRQRIWKHGHVFULEHGPDWHULDOFRQFHSWV FI6HFWLRQ 6RWKHUHDOWDVNLVWR PHQWDWLRQRIWKHGHVFULEHGPDWHULDOFRQFHSWV FI6HFWLRQ 6RWKHUHDOWDVNLVWR
³DFWLYDWH´DQG³GHDFWLYDWH´SDVVLYDWLRQRIWKHLPSOHPHQWHGSULQFLSDOFRPSRXQGVLH ³DFWLYDWH´DQG³GHDFWLYDWH´SDVVLYDWLRQRIWKHLPSOHPHQWHGSULQFLSDOFRPSRXQGVLH
WKH]LQF FI6HFWLRQ DQGPDJQHVLXP FI6HFWLRQ DVUHTXLUHG7KLVDOVR WKH]LQF FI6HFWLRQ DQGPDJQHVLXP FI6HFWLRQ DVUHTXLUHG7KLVDOVR
UHODWHVWRWKHSURWHFWLQJIXQFWLRQWKDWWKHPDJQHVLXPSURYLGHVWRWKH]LQFLQWKHOD\ UHODWHVWRWKHSURWHFWLQJIXQFWLRQWKDWWKHPDJQHVLXPSURYLGHVWRWKH]LQFLQWKHOD\
HUHGVXUIDFHPRGLILFDWLRQRIµ3ULQFLSOH,¶7KLVPHFKDQLVPLVH[SODLQHGE\PHDQVRI HUHGVXUIDFHPRGLILFDWLRQRIµ3ULQFLSOH,¶7KLVPHFKDQLVPLVH[SODLQHGE\PHDQVRI
)LJXUHDQG )LJXUH ZKLFKLOOXVWUDWHSURWHFWLRQRIWKH]LQFULFKOD\HUE\WKH )LJXUHDQG )LJXUH ZKLFKLOOXVWUDWHSURWHFWLRQRIWKH]LQFULFKOD\HUE\WKH
RXWHUPDJQHVLXPULFKOD\HUDQGSURWHFWLRQRIFDUERQVWHHOE\]LQFIHUULWHDQGPDJQH RXWHUPDJQHVLXPULFKOD\HUDQGSURWHFWLRQRIFDUERQVWHHOE\]LQFIHUULWHDQGPDJQH
VLXPUHVSHFWLYHO\ VLXPUHVSHFWLYHO\

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


,PSOHPHQWDWLRQDQG6WUXFWXUDO$SSOLFDWLRQV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV ,PSOHPHQWDWLRQDQG6WUXFWXUDO$SSOLFDWLRQV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV

 
)LJXUH >$@ µ6,3'¶ RI 0J&O+2 µ0(3'¶ EDVHG RQ 7DEOH  ZLWK 0JLD  )LJXUH >$@ µ6,3'¶ RI 0J&O+2 µ0(3'¶ EDVHG RQ 7DEOH  ZLWK 0JLD 
íPRO/DQG&OLD PRO/RQ=Q&O+2µ0(3'¶EDVHGRQ7DEOH íPRO/DQG&OLD PRO/RQ=Q&O+2µ0(3'¶EDVHGRQ7DEOH
 ZLWK =QLD  í PRO/ DQG &OLD   PRO/>%@ $V >$@ EXW ZLWK  ZLWK =QLD  í PRO/ DQG &OLD   PRO/ >%@ $V >$@ EXW ZLWK
=QLD PRO/>&@$V>%@EXW0J&O+2µ0(3'¶UHSODFHGE\0J =QLD PRO/>&@$V>%@EXW0J&O+2µ0(3'¶UHSODFHGE\0J
&D&+2µ0(3'¶EDVHGRQ7DEOHZLWK&DLD íPRO/0JLD  &D&+2µ0(3'¶EDVHGRQ7DEOHZLWK&DLD íPRO/0JLD 
íPRO/DQG&LD íPRO/ íPRO/DQG&LD íPRO/
 

 
)LJXUH >$@ µ6,3'¶ RI 0J&O+2 µ0(3'¶ EDVHG RQ 7DEOH  ZLWK 0JLD  )LJXUH >$@ µ6,3'¶ RI 0J&O+2 µ0(3'¶ EDVHG RQ 7DEOH  ZLWK 0JLD 
í PRO/ DQG &OLD   PRO/ RQ =Q)H&O+2 µ0(3'¶ EDVHG RQ í PRO/ DQG &OLD   PRO/ RQ =Q)H&O+2 µ0(3'¶ EDVHG RQ
7DEOH  ZLWK =QLD  í PRO/ )HLD  í PRO/ DQG &OLD   7DEOH  ZLWK =QLD  í PRO/ )HLD  í PRO/ DQG &OLD  
PRO/ RQ )H&O+2 µ0(3'¶ EDVHG RQ 7DEOH  DQG )HLD  í PRO/ RQ )H&O+2 µ0(3'¶ EDVHG RQ 7DEOH  DQG )HLD  í
PRO/DQG&OLD PRO/>%@$V>$@EXW=Q)H&O+2µ0(3'¶ZLWK PRO/DQG&OLD PRO/>%@$V>$@EXW=Q)H&O+2µ0(3'¶ZLWK
=QLD í PRO/>&@$V >%@ EXW0J&O+2µ0(3'¶UHSODFHGE\ =QLD  í PRO/ >&@$V >%@ EXW0J&O+2µ0(3'¶UHSODFHGE\
0J&D&+2 µ0(3'¶ EDVHG RQ 7DEOH  ZLWK &DLD  í PRO/ 0J&D&+2 µ0(3'¶ EDVHG RQ 7DEOH  ZLWK &DLD  í PRO/
0JLD íPRO/DQG&LD íPRO/ 0JLD íPRO/DQG&LD íPRO/
7KHSURWHFWLYH IXQFWLRQ RIPDJQHVLXP IRUWKHORVVOHVVSDVVLYDWLRQRI]LQFDVZHOO DV 7KHSURWHFWLYH IXQFWLRQ RIPDJQHVLXP IRUWKHORVVOHVVSDVVLYDWLRQRI]LQFDVZHOO DV
WKH SURWHFWLYH IXQFWLRQ RI ]LQFIHUULWH IRU WKH XQGHUO\LQJ FDUERQ VWHHO ZKLFK LV WKH SURWHFWLYH IXQFWLRQ RI ]LQFIHUULWH IRU WKH XQGHUO\LQJ FDUERQ VWHHO ZKLFK LV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV ,PSOHPHQWDWLRQDQG6WUXFWXUDO$SSOLFDWLRQV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV ,PSOHPHQWDWLRQDQG6WUXFWXUDO$SSOLFDWLRQV

DFKLHYHGE\WKHSURWHFWLRQJUDQWHGE\WKHPDJQHVLXPLVLPPHGLDWHO\REYLRXVLQ)LJ DFKLHYHGE\WKHSURWHFWLRQJUDQWHGE\WKHPDJQHVLXPLVLPPHGLDWHO\REYLRXVLQ)LJ
XUHDQG)LJXUHUHVSHFWLYHO\0RUHRYHUWKHWKHRUHWLFDORSHUDWLRQDOUDQJHIRU XUHDQG)LJXUHUHVSHFWLYHO\0RUHRYHUWKHWKHRUHWLFDORSHUDWLRQDOUDQJHIRU
WKHWDUJHWHGµ(FRUU¶DFKLHYHGE\SURSRUWLRQLQJRIWKHSULQFLSDOPDWHULDOFRQFHSWVFDQEH WKHWDUJHWHGµ(FRUU¶DFKLHYHGE\SURSRUWLRQLQJRIWKHSULQFLSDOPDWHULDOFRQFHSWVFDQEH
HVWLPDWHGIURP)LJXUH HVWLPDWHGIURP)LJXUH
7KHSURFHVVHVGHVLJQHGIRUWKHLPSOHPHQWDWLRQRIWKHSURSRVHGQHZFRXQWHUPHDVXUHV 7KHSURFHVVHVGHVLJQHGIRUWKHLPSOHPHQWDWLRQRIWKHSURSRVHGQHZFRXQWHUPHDVXUHV
GLIIHUQRWRQO\EHWZHHQWKHWZRSULQFLSOHVRILPSOHPHQWDWLRQEXWDOVRZLWKUHJDUGWR GLIIHUQRWRQO\EHWZHHQWKHWZRSULQFLSOHVRILPSOHPHQWDWLRQEXWDOVRZLWKUHJDUGWR
WKH DSSOLFDWLRQ LQ QHZ DQG H[LVWLQJ VWUXFWXUHV 7KH SUHOLPLQDU\ UHPDUNV RQ WKH LQ WKH DSSOLFDWLRQ LQ QHZ DQG H[LVWLQJ VWUXFWXUHV 7KH SUHOLPLQDU\ UHPDUNV RQ WKH LQ
WHQGHGVWUXFWXUDODSSOLFDWLRQJLYHQEHORZ DUH VXEGLYLGHG LQ UHODWLRQWR WKHLU DSSOLFD WHQGHGVWUXFWXUDODSSOLFDWLRQJLYHQEHORZ DUH VXEGLYLGHG LQ UHODWLRQWR WKHLU DSSOLFD
WLRQLQQHZDQGH[LVWLQJVWUXFWXUHV WLRQLQQHZDQGH[LVWLQJVWUXFWXUHV
‡ µ3ULQFLSOH,¶IRUQHZVWUXFWXUHVLHLQLWLDOFRXQWHUPHDVXUHV ‡ µ3ULQFLSOH,¶IRUQHZVWUXFWXUHVLHLQLWLDOFRXQWHUPHDVXUHV
)RU QHZ VWUXFWXUHV WKH HVWDEOLVKPHQW RI WKH OD\HUHG VXUIDFH PRGLILFDWLRQ LV LQ )RU QHZ VWUXFWXUHV WKH HVWDEOLVKPHQW RI WKH OD\HUHG VXUIDFH PRGLILFDWLRQ LV LQ
WHQGHG WR EH EDVHG RQ DQ DXWRPDWHG VHTXHQFH RI WKUHH SURFHVVHV 7KH SURFHVVHV WHQGHG WR EH EDVHG RQ DQ DXWRPDWHG VHTXHQFH RI WKUHH SURFHVVHV 7KH SURFHVVHV
DUHUHODWLYHO\VLPSOHDQGFDQEHDVVHPEOHGLQDWUDQVSRUWDEOHGHYLFHVRWKDWWKH\ DUHUHODWLYHO\VLPSOHDQGFDQEHDVVHPEOHGLQDWUDQVSRUWDEOHGHYLFHVRWKDWWKH\
FDQEHSHUIRUPHGRQVLWH,GHDOO\VLQJOHFDUERQVWHHOUHEDUVDUHWREHSURFHVVHGLQ FDQEHSHUIRUPHGRQVLWH,GHDOO\VLQJOHFDUERQVWHHOUHEDUVDUHWREHSURFHVVHGLQ
FRQYHQLHQW EDWFK VL]HV DW DQ\ OHQJWK  ZKLOH SURFHVVLQJ RI HJ ' FDJHV LV RS FRQYHQLHQW EDWFK VL]HV DW DQ\ OHQJWK  ZKLOH SURFHVVLQJ RI HJ ' FDJHV LV RS
WLRQDOLIDTXDOLW\ORVVRIWKHVXUIDFHPRGLILFDWLRQLVDFFHSWDEOH WLRQDOLIDTXDOLW\ORVVRIWKHVXUIDFHPRGLILFDWLRQLVDFFHSWDEOH
7KHILUVWSURFHVVLQWKHVHTXHQFHLVDFOHDQLQJSURFHVVEDVHGRQJULWEODVWLQJ:LWK 7KHILUVWSURFHVVLQWKHVHTXHQFHLVDFOHDQLQJSURFHVVEDVHGRQJULWEODVWLQJ:LWK
UHJDUGWRWKHUHVXOWVREWDLQHGLQµ7HVW,¶DQGµ7HVW,,¶ FI6HFWLRQVDQG  UHJDUGWRWKHUHVXOWVREWDLQHGLQµ7HVW,¶DQGµ7HVW,,¶ FI6HFWLRQVDQG 
JULWEODVWLQJLVFRQVLGHUHGWREHPRUHHIILFLHQWLQUHPRYLQJFRUURVLRQSURGXFWVDQG JULWEODVWLQJLVFRQVLGHUHGWREHPRUHHIILFLHQWLQUHPRYLQJFRUURVLRQSURGXFWVDQG
VFDOHHWFIURPWKHFDUERQVWHHOUHEDUVXUIDFH FI6HFWLRQ WKDQHJHOHFWUR VFDOHHWFIURPWKHFDUERQVWHHOUHEDUVXUIDFH FI6HFWLRQ WKDQHJHOHFWUR
FKHPLFDOWHFKQLTXHV FI6HFWLRQ 0RUHRYHUµ7HVW,,¶UHVXOWVLQGLFDWHGWKDW FKHPLFDOWHFKQLTXHV FI6HFWLRQ 0RUHRYHUµ7HVW,,¶UHVXOWVLQGLFDWHGWKDW
WKHLQFUHDVHGVXUIDFHDUHDREWDLQHGZLWKJULWEODVWLQJLVDGYDQWDJHRXVLQWKHSUR WKHLQFUHDVHGVXUIDFHDUHDREWDLQHGZLWKJULWEODVWLQJLVDGYDQWDJHRXVLQWKHSUR
WHFWLYHIXQFWLRQRIWKHLQQHU]LQFULFKOD\HU'HWDLOVRQWKHVHFRQGDQGWKLUGSURF WHFWLYHIXQFWLRQRIWKHLQQHU]LQFULFKOD\HU'HWDLOVRQWKHVHFRQGDQGWKLUGSURF
HVVHVLQWKHVHTXHQFHDUHQRWJLYHQLQWKLVWKHVLVZLWKUHJDUGWRWKHH[SHFWHGSDWHQW HVVHVLQWKHVHTXHQFHDUHQRWJLYHQLQWKLVWKHVLVZLWKUHJDUGWRWKHH[SHFWHGSDWHQW
SRVVLELOLWLHV FI6HFWLRQ  SRVVLELOLWLHV FI6HFWLRQ 
‡ µ3ULQFLSOH,¶IRUH[LVWLQJVWUXFWXUHVLHUHSDLUWHFKQLTXHV ‡ µ3ULQFLSOH,¶IRUH[LVWLQJVWUXFWXUHVLHUHSDLUWHFKQLTXHV
7KHSURFHVVHVRIDSSO\LQJµ3ULQFLSOH,¶LQWKHUHSDLURIH[LVWLQJVWUXFWXUHVDUHVLPL 7KHSURFHVVHVRIDSSO\LQJµ3ULQFLSOH,¶LQWKHUHSDLURIH[LVWLQJVWUXFWXUHVDUHVLPL
ODUWRWKHRQHVDSSOLHGIRUQHZFRXQWHUPHDVXUHVZLWKWKHGLIIHUHQFHWKDWWKHWKUHH ODUWRWKHRQHVDSSOLHGIRUQHZFRXQWHUPHDVXUHVZLWKWKHGLIIHUHQFHWKDWWKHWKUHH
IROGSURFHVVVHTXHQFHLVDSSOLHGWREXLOWLQUHEDUVDVRSSRVHGWREDWFKHVRIVLQJOH IROGSURFHVVVHTXHQFHLVDSSOLHGWREXLOWLQUHEDUVDVRSSRVHGWREDWFKHVRIVLQJOH
UHEDUV 7KH SUHSDUDWLRQ DQG WKH SHUIRUPDQFHV IROORZLQJ WKH DSSOLFDWLRQ RI WKH UHEDUV 7KH SUHSDUDWLRQ DQG WKH SHUIRUPDQFHV IROORZLQJ WKH DSSOLFDWLRQ RI WKH
WKUHHIROG DSSOLFDWLRQ SURFHVV DUH EDVHG RQ WKH WDVNV SHUIRUPHG LQ FRQYHQWLRQDO WKUHHIROG DSSOLFDWLRQ SURFHVV DUH EDVHG RQ WKH WDVNV SHUIRUPHG LQ FRQYHQWLRQDO
SDWFKUHSDLU FI6HFWLRQ ,QFRQWUDVWWRWKHDXWRPDWHGVHTXHQFHXVHGIRULQL SDWFKUHSDLU FI6HFWLRQ ,QFRQWUDVWWRWKHDXWRPDWHGVHTXHQFHXVHGIRULQL
WLDO PHDVXUHV WKH SURFHVVHV LQ WKH DSSOLFDWLRQ RI µ3ULQFLSOH ,¶ IRU H[LVWLQJ VWUXF WLDO PHDVXUHV WKH SURFHVVHV LQ WKH DSSOLFDWLRQ RI µ3ULQFLSOH ,¶ IRU H[LVWLQJ VWUXF
WXUHVDUHWREHSHUIRUPHGPDQXDOO\RQHDIWHUWKHRWKHU:KLOHWKHFOHDQLQJSURFHVV WXUHVDUHWREHSHUIRUPHGPDQXDOO\RQHDIWHUWKHRWKHU:KLOHWKHFOHDQLQJSURFHVV
LVDOVREDVHGRQJULWEODVWLQJWKHDSSOLFDWLRQRIWKHVHFRQGDQGWKLUGSURFHVVLQUH LVDOVREDVHGRQJULWEODVWLQJWKHDSSOLFDWLRQRIWKHVHFRQGDQGWKLUGSURFHVVLQUH
SDLU GLIIHUV IURP LPSOHPHQWDWLRQ IRU QHZ VWUXFWXUHV $V IRU WKH SUHYLRXV %XOOHW SDLU GLIIHUV IURP LPSOHPHQWDWLRQ IRU QHZ VWUXFWXUHV $V IRU WKH SUHYLRXV %XOOHW
GHWDLOVRQWKHVHFRQGDQGWKLUGSURFHVVHVLQWKHVHTXHQFHDUHQRWJLYHQLQWKLVWKH GHWDLOVRQWKHVHFRQGDQGWKLUGSURFHVVHVLQWKHVHTXHQFHDUHQRWJLYHQLQWKLVWKH
VLVZLWKUHJDUGWRWKHH[SHFWHGSDWHQWSRVVLELOLWLHV FI6HFWLRQ  VLVZLWKUHJDUGWRWKHH[SHFWHGSDWHQWSRVVLELOLWLHV FI6HFWLRQ 
‡ µ3ULQFLSOH,,¶IRUQHZVWUXFWXUHVLHLQLWLDOFRXQWHUPHDVXUHV ‡ µ3ULQFLSOH,,¶IRUQHZVWUXFWXUHVLHLQLWLDOFRXQWHUPHDVXUHV

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


,PSOHPHQWDWLRQDQG6WUXFWXUDO$SSOLFDWLRQV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV ,PSOHPHQWDWLRQDQG6WUXFWXUDO$SSOLFDWLRQV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV

,QFRQWUDVWWRUHSDLUZKHUHWKHLQVWDOODWLRQRIVDFULILFLDODQRGHVLVJHQHUDOO\OLP ,QFRQWUDVWWRUHSDLUZKHUHWKHLQVWDOODWLRQRIVDFULILFLDODQRGHVLVJHQHUDOO\OLP
LWHG WR GDPDJHG UHJLRQV GHVLJQLQJ VDFULILFLDO FDWKRGLF SURWHFWLRQ DV DQ LQLWLDO LWHG WR GDPDJHG UHJLRQV GHVLJQLQJ VDFULILFLDO FDWKRGLF SURWHFWLRQ DV DQ LQLWLDO
PHDVXUHJUDQWVYDULRXVRSWLRQVIRUDQRGHOD\RXWVDQGSRVLWLRQLQJ'HWDLOVUHJDUG PHDVXUHJUDQWVYDULRXVRSWLRQVIRUDQRGHOD\RXWVDQGSRVLWLRQLQJ'HWDLOVUHJDUG
LQJJHRPHWU\DQGSODFLQJDUHQRWGHDOW ZLWKLQWKHSUHVHQWWKHVLVEXWRQHRSWLRQ LQJJHRPHWU\DQGSODFLQJDUHQRWGHDOWZLWKLQWKHSUHVHQWWKHVLVEXWRQHRSWLRQ
XQGHUFRQVLGHUDWLRQVKRXOGEHPHQWLRQHG XQGHUFRQVLGHUDWLRQVKRXOGEHPHQWLRQHG
,PSOHPHQWLQJWKHVDFULILFLDODQRGHVE\PHDQVRIFRQFUHWHVSDFHUVFDQEHDFRVW ,PSOHPHQWLQJWKHVDFULILFLDODQRGHVE\PHDQVRIFRQFUHWHVSDFHUV FDQEHDFRVW
HIILFLHQWDQGSUDFWLFDOVROXWLRQIRUQHZVWUXFWXUHV)RUFRQVWUXFWLYHUHDVRQVDODUJH HIILFLHQWDQGSUDFWLFDOVROXWLRQIRUQHZVWUXFWXUHV)RUFRQVWUXFWLYHUHDVRQVDODUJH
QXPEHURIVSDFHUVLV JHQHUDOO\LQ FRQWDFWZLWKWKHRXWHUUHLQIRUFHPHQWOD\HULH QXPEHURIVSDFHUVLV JHQHUDOO\LQ FRQWDFWZLWKWKHRXWHUUHLQIRUFHPHQWOD\HULH
WKHOD\HUWKDWLVIRUHPRVWDIIHFWHGE\FRUURVLRQ6SDFHUVFRXOGEHHDVLO\HTXLSSHG WKHOD\HUWKDWLVIRUHPRVWDIIHFWHGE\FRUURVLRQ6SDFHUVFRXOGEHHDVLO\HTXLSSHG
ZLWK IRU WKH GRSHG PHWDO RSWLRQ  RU SURGXFHG DV IRU WKH HQFDSVXODWLRQ RSWLRQ  ZLWK IRU WKH GRSHG PHWDO RSWLRQ  RU SURGXFHG DV IRU WKH HQFDSVXODWLRQ RSWLRQ 
VDFULILFLDODQRGHVDQGWKXVWKHUHLQIRUFHPHQWFRXOGEHSURWHFWHGZLWKRXWWKHQHHG VDFULILFLDODQRGHVDQGWKXVWKHUHLQIRUFHPHQWFRXOGEHSURWHFWHGZLWKRXWWKHQHHG
IRUDQ\IXUWKHULQVWDOODWLRQVDQGZLWKRXWFKDQJLQJWKHVWDQGDUGSUDFWLFHRQVLWH IRUDQ\IXUWKHULQVWDOODWLRQVDQGZLWKRXWFKDQJLQJWKHVWDQGDUGSUDFWLFHRQVLWH
‡ µ3ULQFLSOH,,¶IRUH[LVWLQJVWUXFWXUHVLHUHSDLUWHFKQLTXHV ‡ µ3ULQFLSOH,,¶IRUH[LVWLQJVWUXFWXUHVLHUHSDLUWHFKQLTXHV
5HSDLUE\µ3ULQFLSOH ,,¶ LVEDVHGRQWKHVDPHSHUIRUPDQFHVDVGHVFULEHG IRU WKH 5HSDLUE\µ3ULQFLSOH ,,¶ LVEDVHGRQWKHVDPHSHUIRUPDQFHVDVGHVFULEHG IRU WKH
DSSOLFDWLRQRIWKH*DOYDVKLHOG;3DQRGHV\VWHP7KHSODFHPHQWDQGSRVVLEOHOD\ DSSOLFDWLRQRIWKH*DOYDVKLHOG;3DQRGHV\VWHP7KHSODFHPHQWDQGSRVVLEOHOD\
RXWVIRUWKHVDFULILFLDODQRGHDUHJRYHUQHGE\WKHH[WHQWDQGJHRPHWU\RIWKHSDWFK RXWVIRUWKHVDFULILFLDODQRGHDUHJRYHUQHGE\WKHH[WHQWDQGJHRPHWU\RIWKHSDWFK
UHSDLU %RWK RSWLRQV IRU WKH LPSOHPHQWDWLRQ RI WKH PDWHULDOV FRQFHSWV LH WKH UHSDLU %RWK RSWLRQV IRU WKH LPSOHPHQWDWLRQ RI WKH PDWHULDOV FRQFHSWV LH WKH
GRSHGPDWHULDODQGWKHHQFDSVXODWLRQRSWLRQDUHDYDLODEOHIRUUHSDLU GRSHGPDWHULDODQGWKHHQFDSVXODWLRQRSWLRQDUHDYDLODEOHIRUUHSDLU
%RWKSULQFLSOHVRILPSOHPHQWDWLRQDUHVXLWDEOHIRUPRVWH[SRVXUHVLWXDWLRQVZKLOHLWLV %RWKSULQFLSOHVRILPSOHPHQWDWLRQDUHVXLWDEOHIRUPRVWH[SRVXUHVLWXDWLRQVZKLOHLWLV
REYLRXVWKDWWKHFRQFUHWHQHHGVWREHDWDFHUWDLQVDWXUDWLRQOHYHOVRWKDWFRXQWHUPHD REYLRXVWKDWWKHFRQFUHWHQHHGVWREHDWDFHUWDLQVDWXUDWLRQOHYHOVRWKDWFRXQWHUPHD
VXUHVEDVHGRQµ3ULQFLSOH,,¶DUHHIIHFWLYH7KLVLVJHQHUDOO\WKHFDVHIRUPDULQHVWUXF VXUHVEDVHGRQµ3ULQFLSOH,,¶DUHHIIHFWLYH7KLVLVJHQHUDOO\WKHFDVHIRUPDULQHVWUXF
WXUHV EXW QRW QHFHVVDULO\ IRU VWUXFWXUHV VHDVRQDOO\ H[SRVHG WR GHLFLQJ VDOW ,Q VXFK WXUHV EXW QRW QHFHVVDULO\ IRU VWUXFWXUHV VHDVRQDOO\ H[SRVHG WR GHLFLQJ VDOW ,Q VXFK
FRQGLWLRQVFRPELQDWLRQVRIWKHWZRSULQFLSOHVRILPSOHPHQWDWLRQFRXOGDOVREHDQRS FRQGLWLRQVFRPELQDWLRQVRIWKHWZRSULQFLSOHVRILPSOHPHQWDWLRQFRXOGDOVREHDQRS
WLRQLIH[SRVXUHFRQGLWLRQVDUHVHYHUH7KDWPHDQVWKDWVDFULILFLDODQRGHVSURYLGHDG WLRQLIH[SRVXUHFRQGLWLRQVDUHVHYHUH7KDWPHDQVWKDWVDFULILFLDODQRGHVSURYLGHDG
GLWLRQDO SURWHFWLRQ IRU WKH VXUIDFH PRGLILFDWLRQ DW LQFUHDVLQJ GHJUHH RI VDWXUDWLRQ GLWLRQDO SURWHFWLRQ IRU WKH VXUIDFH PRGLILFDWLRQ DW LQFUHDVLQJ GHJUHH RI VDWXUDWLRQ
ZKLFK LV JHQHUDOO\ FULWLFDO LQ UHODWLRQ WR FKORULGH LQGXFHG FRUURVLRQ FI 6HFWLRQ ZKLFK LV JHQHUDOO\ FULWLFDO LQ UHODWLRQ WR FKORULGH LQGXFHG FRUURVLRQ FI 6HFWLRQ
 )RUWKLVFRPELQHGDSSOLFDWLRQDVZHOODVIRUWKHDSSOLFDWLRQRIµ3ULQFLSOH,¶RU  )RUWKLVFRPELQHGDSSOLFDWLRQDVZHOODVIRUWKHDSSOLFDWLRQRIµ3ULQFLSOH,¶RU
µ3ULQFLSOH,,¶DORQHWKHGHJUHHRISURWHFWLRQFDQEHGHVLJQHGWRPHHWWKHUHTXLUHPHQWV µ3ULQFLSOH,,¶DORQHWKHGHJUHHRISURWHFWLRQFDQEHGHVLJQHGWRPHHWWKHUHTXLUHPHQWV
LHWKHVHUYLFHOLIH E\DGMXVWLQJWKHH[WHQWRIWKHVXUIDFHPRGLILFDWLRQIRUµ3ULQFLSOH LHWKHVHUYLFHOLIH E\DGMXVWLQJWKHH[WHQWRIWKHVXUIDFHPRGLILFDWLRQIRUµ3ULQFLSOH
,¶RUWKHDPRXQWRUOD\RXWRIWKHVDFULILFLDODQRGHVIRUµ3ULQFLSOH,,¶ ,¶RUWKHDPRXQWRUOD\RXWRIWKHVDFULILFLDODQRGHVIRUµ3ULQFLSOH,,¶
)LQDOO\WKHGHYHORSPHQWDQGLPSOHPHQWDWLRQRIHIIHFWLYHFRUURVLRQVHQVRUVSOD\HGD )LQDOO\WKHGHYHORSPHQWDQGLPSOHPHQWDWLRQRIHIIHFWLYHFRUURVLRQVHQVRUVSOD\HGD
VHFRQGDU\UROHLQRXUWKHRUHWLFDOFRQVLGHUDWLRQVDQGSUDFWLFDOUHDOLVDWLRQIRUERWKSULQ VHFRQGDU\UROHLQRXUWKHRUHWLFDOFRQVLGHUDWLRQVDQGSUDFWLFDOUHDOLVDWLRQIRUERWKSULQ
FLSOHV RI LPSOHPHQWDWLRQ &RUURVLRQ PRQLWRULQJ PD\ EH LPSOHPHQWHG EDVHG RQ D FLSOHV RI LPSOHPHQWDWLRQ &RUURVLRQ PRQLWRULQJ PD\ EH LPSOHPHQWHG EDVHG RQ D
PRGLILHGOD\RXWRIWKHLQVWUXPHQWHGPRUWDUVSHFLPHQLQFRPELQDWLRQZLWKWKHHOHFWUR PRGLILHGOD\RXWRIWKHLQVWUXPHQWHGPRUWDUVSHFLPHQLQFRPELQDWLRQZLWKWKHHOHFWUR
FKHPLFDO PHDVXUHPHQWV ZKLFK ZHUH EULHIO\ GHVFULEHG LQ 6HFWLRQ  DQG ZLOO EH FKHPLFDO PHDVXUHPHQWV ZKLFK ZHUH EULHIO\ GHVFULEHG LQ 6HFWLRQ  DQG ZLOO EH
IXUWKHUHODERUDWHGLQ6HFWLRQVDQG:HFRQVLGHUWKDWGHYHORSPHQWVLQWKLV IXUWKHUHODERUDWHGLQ6HFWLRQVDQG:HFRQVLGHUWKDWGHYHORSPHQWVLQWKLV
GLUHFWLRQFDQEHSDUWLFXODUO\LQWHUHVWLQJLQFRPELQDWLRQZLWKWKHDSSOLFDWLRQRIµ3ULQ GLUHFWLRQFDQEHSDUWLFXODUO\LQWHUHVWLQJLQFRPELQDWLRQZLWKWKHDSSOLFDWLRQRIµ3ULQ
FLSOH,,¶E\PHDQVRIFRQFUHWHVSDFHUVDLPLQJDWWKHHVWDEOLVKPHQWRID³VPDUWVSDFHU´ FLSOH,,¶E\PHDQVRIFRQFUHWHVSDFHUVDLPLQJDWWKHHVWDEOLVKPHQWRID³VPDUWVSDFHU´
VROXWLRQ VROXWLRQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 3UHOLPLQDU\7HVWLQJ$VSHFWVDQG5HTXLUHPHQWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 3UHOLPLQDU\7HVWLQJ$VSHFWVDQG5HTXLUHPHQWV

%RWKSULQFLSOHVRILPSOHPHQWDWLRQDUHEDVHGRQXVLQJUHODWLYHO\VPDOOSURSRUWLRQVRI %RWKSULQFLSOHVRILPSOHPHQWDWLRQDUHEDVHGRQXVLQJUHODWLYHO\VPDOOSURSRUWLRQVRI
]LQFDQGPDJQHVLXPLQFRPELQDWLRQZLWKLQH[SHQVLYHDQGHFRORJLFDOFRPSRXQGVDQG ]LQFDQGPDJQHVLXPLQFRPELQDWLRQZLWKLQH[SHQVLYHDQGHFRORJLFDOFRPSRXQGVDQG
SURGXFWLRQ SURFHVVHV %HVLGHV WKHVH DVSHFWV ZKLFK DUH FHQWUDO LQ IXOILOOLQJ WKH WZR SURGXFWLRQ SURFHVVHV %HVLGHV WKHVH DVSHFWV ZKLFK DUH FHQWUDO LQ IXOILOOLQJ WKH WZR
ILQDOUHTXLUHPHQWVVWDWHGLQ6HFWLRQ FI%XOOHWVDQG LWLVHYLGHQWWKDWWKHRWKHU ILQDOUHTXLUHPHQWVVWDWHGLQ6HFWLRQ FI%XOOHWVDQG LWLVHYLGHQWWKDWWKHRWKHU
UHTXLUHPHQWV FRQFHUQLQJ LPSURYHG FRUURVLRQ UHVLVWDQFH IRU QHZ DQG H[LVWLQJ VWUXF UHTXLUHPHQWV FRQFHUQLQJ LPSURYHG FRUURVLRQ UHVLVWDQFH IRU QHZ DQG H[LVWLQJ VWUXF
WXUHV FI%XOOHW VWUXFWXUDOSHUIRUPDQFHDVZHOODVUHLQIRUFHPHQWDQGFRQFUHWHGX WXUHV FI%XOOHW VWUXFWXUDOSHUIRUPDQFHDVZHOODVUHLQIRUFHPHQWDQGFRQFUHWHGX
UDELOLW\ FI%XOOHW FUDFNLQJRIWKHFRQFUHWH FI%XOOHW DQGILQDOO\WKHYDULRXV UDELOLW\ FI%XOOHW FUDFNLQJRIWKHFRQFUHWH FI%XOOHW DQGILQDOO\WKHYDULRXV
SUDFWLFDOUHTXLUHPHQWV FI%XOOHW DUHDOVRIXOILOOHG SUDFWLFDOUHTXLUHPHQWV FI%XOOHW DUHDOVRIXOILOOHG
7KXVZHWKLQNWKDWIXUWKHUGHYHORSPHQWDQGH[WHQVLYHWHVWLQJ FI6HFWLRQ RIWKH 7KXVZHWKLQNWKDWIXUWKHUGHYHORSPHQWDQGH[WHQVLYHWHVWLQJ FI6HFWLRQ RIWKH
SURSRVHG QHZ FRXQWHUPHDVXUHV FRXOG SUHVHQW VXLWDEOH DOWHUQDWLYHV IRU HIILFLHQW EXW SURSRVHG QHZ FRXQWHUPHDVXUHV FRXOG SUHVHQW VXLWDEOH DOWHUQDWLYHV IRU HIILFLHQW EXW
H[SHQVLYHRULPSUDFWLFDODYDLODEOH FRXQWHUPHDVXUHV DV HJ VWDLQOHVV VWHHO LQFOXGLQJ H[SHQVLYH RU LPSUDFWLFDO DYDLODEOH FRXQWHUPHDVXUHV DV HJ VWDLQOHVVVWHHO LQFOXGLQJ
VHOHFWLYHXVHFI6HFWLRQ DQGµ&3UH¶µ&3¶ FI6HFWLRQVDQG LQ VHOHFWLYHXVHFI6HFWLRQ DQGµ&3UH¶µ&3¶ FI6HFWLRQVDQG LQ
WKHIXWXUH:KLOHWKHPDLQGHYHORSPHQWVLHFRXQWHUPHDVXUHVEDVHGRQµ3ULQFLSOH,¶ WKHIXWXUH:KLOHWKHPDLQGHYHORSPHQWVLHFRXQWHUPHDVXUHVEDVHGRQµ3ULQFLSOH,¶
DQG µ3ULQFLSOH ,,¶ JHQHUDOO\ DLP DW FKORULGH H[SRVXUH ZH DVVXPH WKDW FDUERQDWLRQ DQG µ3ULQFLSOH ,,¶ JHQHUDOO\ DLP DW FKORULGH H[SRVXUH ZH DVVXPH WKDW FDUERQDWLRQ
DORQH FRXOG EH HIILFLHQWO\ DGGUHVVHG E\ WKH ]LQFIHUULWH SURWHFWLRQ PHFKDQLVP DORQH FRXOG EH HIILFLHQWO\ DGGUHVVHG E\ WKH ]LQFIHUULWH SURWHFWLRQ PHFKDQLVP
DFKLHYHGE\WKHWKLQ]LQFOD\HUDSSURDFK FI6HFWLRQ  DFKLHYHGE\WKHWKLQ]LQFOD\HUDSSURDFK FI6HFWLRQ 

 3UHOLPLQDU\7HVWLQJ$VSHFWVDQG5HTXLUHPHQWV  3UHOLPLQDU\7HVWLQJ$VSHFWVDQG5HTXLUHPHQWV


,QWKLV6HFWLRQUHTXLUHPHQWVDQG DVSHFWV WKDW ZH FRQVLGHU WREH HVVHQWLDOLQSUHOLPL ,QWKLV6HFWLRQUHTXLUHPHQWVDQG DVSHFWV WKDW ZH FRQVLGHU WREH HVVHQWLDOLQSUHOLPL
QDU\WHVWLQJRIQHZFRXQWHUPHDVXUHVDUHGLVFXVVHG FISKDVHLQ)LJXUH (PSKD QDU\WHVWLQJRIQHZFRXQWHUPHDVXUHVDUHGLVFXVVHG FISKDVHLQ)LJXUH (PSKD
VLVLVVHWRQHOHFWURFKHPLFDOWHVWLQJ FI6HFWLRQ ZKLOHWKHPRVWLPSRUWDQWDGGL VLVLVVHWRQHOHFWURFKHPLFDOWHVWLQJ FI6HFWLRQ ZKLOHWKHPRVWLPSRUWDQWDGGL
WLRQDOPHDVXUHPHQWWHFKQLTXHVDUHRQO\OLVWHGDQGEULHIO\FRPPHQWHGXSRQ FI6HF WLRQDOPHDVXUHPHQWWHFKQLTXHVDUHRQO\OLVWHGDQGEULHIO\FRPPHQWHGXSRQ FI6HF
WLRQ   7KH HOHFWURFKHPLFDO WHVWLQJWHFKQLTXHVDUHEDVHGRQWKHWKHRU\RIPHDV WLRQ   7KH HOHFWURFKHPLFDO WHVWLQJ WHFKQLTXHV DUHEDVHG RQWKHWKHRU\RIPHDV
XUHPHQWV DQG PRQLWRULQJ LQ DTXHRXV PHWDOOLF FRUURVLRQ FI 6HFWLRQ   ZKLOH WKH XUHPHQWV DQG PRQLWRULQJ LQ DTXHRXV PHWDOOLF FRUURVLRQ FI 6HFWLRQ   ZKLOH WKH
OLVWHGDGGLWLRQDOWHFKQLTXHVUHODWHWRWKHFKHPLFDOWHVWLQJDVZHOODVWRWKHPLFURVFRSLF OLVWHGDGGLWLRQDOWHFKQLTXHVUHODWHWRWKHFKHPLFDOWHVWLQJDVZHOODVWRWKHPLFURVFRSLF
DQG;UD\DQDO\VHVZKLFKZHUHLQWURGXFHGWKURXJKRXW&KDSWHU2XUDSSOLFDWLRQRI DQG;UD\DQDO\VHVZKLFKZHUHLQWURGXFHGWKURXJKRXW&KDSWHU2XUDSSOLFDWLRQRI
WKHVHWHFKQLTXHVLHWKHLULPSOHPHQWDWLRQLQRXUH[SHULPHQWDOLQYHVWLJDWLRQV FI6HF WKHVHWHFKQLTXHVLHWKHLULPSOHPHQWDWLRQLQRXUH[SHULPHQWDOLQYHVWLJDWLRQV FI6HF
WLRQ LVGHVFULEHGLQPRUHGHWDLOLQ6HFWLRQ WLRQ LVGHVFULEHGLQPRUHGHWDLOLQ6HFWLRQ

 (OHFWURFKHPLFDO7HFKQLTXHV  (OHFWURFKHPLFDO7HFKQLTXHV


,QWKLV6HFWLRQWKHDSSOLFDWLRQRIWKHHOHFWURFKHPLFDOPHDVXUHPHQWWHFKQLTXHVDYDLO ,QWKLV6HFWLRQWKHDSSOLFDWLRQRIWKHHOHFWURFKHPLFDOPHDVXUHPHQWWHFKQLTXHVDYDLO
DEOH LQ WKH DUHD RI DTXHRXV PHWDOOLF FRUURVLRQ FI 6HFWLRQ  IRURXU H[SHULPHQWDO DEOH LQ WKH DUHD RI DTXHRXV PHWDOOLF FRUURVLRQ FI 6HFWLRQ  IRURXU H[SHULPHQWDO
SXUSRVHV LH IRU WKH SHUIRUPDQFH HYDOXDWLRQ RI FRUURVLRQ FRXQWHUPHDVXUHV LV GLV SXUSRVHV LH IRU WKH SHUIRUPDQFH HYDOXDWLRQ RI FRUURVLRQ FRXQWHUPHDVXUHV LV GLV
FXVVHG 7KH HOHFWURFKHPLFDO WHFKQLTXHV VHOHFWHG IRU RXU SXUSRVHV LQFOXGH FRUURVLRQ FXVVHG 7KH HOHFWURFKHPLFDO WHFKQLTXHV VHOHFWHG IRU RXU SXUSRVHV LQFOXGH FRUURVLRQ
SRWHQWLDOPRQLWRULQJ 6HFWLRQ FRUURVLRQFXUUHQWPRQLWRULQJ 6HFWLRQ  SRWHQWLDOPRQLWRULQJ 6HFWLRQ FRUURVLRQFXUUHQWPRQLWRULQJ 6HFWLRQ 
µ(,6¶ 6HFWLRQ DQGSRODULVDWLRQFXUYHV 6HFWLRQ  µ(,6¶ 6HFWLRQ DQGSRODULVDWLRQFXUYHV 6HFWLRQ 

 &RUURVLRQ3RWHQWLDO0RQLWRULQJ  &RUURVLRQ3RWHQWLDO0RQLWRULQJ


%HVLGHV PHDVXULQJ µ(FRUU¶ LQ RUGHU WR DFFHVV WKH WKHUPRG\QDPLF VWDWH RI WKH LQYHVWL %HVLGHV PHDVXULQJ µ(FRUU¶ LQ RUGHU WR DFFHVV WKH WKHUPRG\QDPLF VWDWH RI WKH LQYHVWL
JDWHGV\VWHP FI6HFWLRQ µ(FRUU¶PRQLWRULQJFDQDOVREHDSSOLHGIRUWKHGLUHFW JDWHGV\VWHP FI6HFWLRQ µ(FRUU¶PRQLWRULQJFDQDOVREHDSSOLHGIRUWKHGLUHFW

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3UHOLPLQDU\7HVWLQJ$VSHFWVDQG5HTXLUHPHQWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 3UHOLPLQDU\7HVWLQJ$VSHFWVDQG5HTXLUHPHQWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV

LGHQWLILFDWLRQRIFRUURVLRQLQLWLDWLRQVLQFHWKHEUHDNGRZQRIWKHSDVVLYHOD\HULVJHQ LGHQWLILFDWLRQRIFRUURVLRQLQLWLDWLRQVLQFHWKHEUHDNGRZQRIWKHSDVVLYHOD\HULVJHQ
HUDOO\DVVRFLDWHGZLWKDVKLIWRIWKHRUGHURIP9WRDORZHUµ(FRUU¶ FI6HF HUDOO\DVVRFLDWHGZLWKD VKLIWRIWKHRUGHURIP9WRDORZHUµ(FRUU¶ FI6HF
WLRQVDQG $VGLVFXVVHGLQ6HFWLRQWKLVSRWHQWLDOGURSRFFXUVUDWKHU WLRQVDQG $VGLVFXVVHGLQ6HFWLRQWKLVSRWHQWLDOGURSRFFXUVUDWKHU
JUDGXDOO\DQGXQVWHDGLO\SDUWLFXODUO\IRUFKORULGHLQGXFHGFRUURVLRQ7KLVPHDQVWKDW JUDGXDOO\DQGXQVWHDGLO\SDUWLFXODUO\IRUFKORULGHLQGXFHGFRUURVLRQ7KLVPHDQVWKDW
LWLVRIWHQGLIILFXOWWRLGHQWLI\WKHH[DFWWLPHRIFRUURVLRQLQLWLDWLRQXVLQJµ(FRUU¶PRQL LWLVRIWHQGLIILFXOWWRLGHQWLI\WKHH[DFWWLPHRIFRUURVLRQLQLWLDWLRQXVLQJµ(FRUU¶PRQL
WRULQJ $QRWKHU PDMRU GUDZEDFN RI SRWHQWLDO PRQLWRULQJ LV WKDW LW RQO\ UHIOHFWV WKH WRULQJ $QRWKHU PDMRU GUDZEDFN RI SRWHQWLDO PRQLWRULQJ LV WKDW LW RQO\ UHIOHFWV WKH
WKHUPRG\QDPLFVWDWHRIWKHUHEDU7KXVLWFDQEHHVWLPDWHGZKHWKHUWKHUHEDULVLQWKH WKHUPRG\QDPLFVWDWHRIWKHUHEDU7KXVLWFDQEHHVWLPDWHGZKHWKHUWKHUHEDULVLQWKH
SDVVLYHRUDFWLYHVWDWHEXWQRLQIRUPDWLRQRQWKHNLQHWLFVDQGFRQVHTXHQWO\RQWKHFRU SDVVLYHRUDFWLYHVWDWHEXWQRLQIRUPDWLRQRQWKHNLQHWLFVDQGFRQVHTXHQWO\RQWKHFRU
URVLRQUDWHFDQEHREWDLQHG'HVSLWHWKHVHGUDZEDFNVDQGRWKHULQFRQVLVWHQFLHVUHODWHG URVLRQUDWHFDQEHREWDLQHG'HVSLWHWKHVHGUDZEDFNVDQGRWKHULQFRQVLVWHQFLHVUHODWHG
WR µ(FRUU¶ PHDVXUHPHQWV HJ >0RQWHPRU HWDO @  SRWHQWLDO PDSSLQJ LQ DFFRU WR µ(FRUU¶ PHDVXUHPHQWV HJ >0RQWHPRU HWDO @  SRWHQWLDO PDSSLQJ LQ DFFRU
GDQFHZLWKHJ>$670&@FDQEHDXVHIXOPHWKRGIRUFRUURVLRQDVVHVVPHQW GDQFHZLWKHJ>$670&@FDQEHDXVHIXOPHWKRGIRUFRUURVLRQDVVHVVPHQW
RQ D VWUXFWXUDO VFDOH HJ WR LGHQWLI\ DUHDV RI SRVVLEOH FRUURVLRQ SULRU WR GHVWUXFWLYH RQ D VWUXFWXUDO VFDOH HJ WR LGHQWLI\ DUHDV RI SRVVLEOH FRUURVLRQ SULRU WR GHVWUXFWLYH
LQVSHFWLRQE\H[FDYDWLRQ LQVSHFWLRQE\H[FDYDWLRQ
)RUFRUURVLRQDVVHVVPHQWRQDVWUXFWXUDOVFDOHWKHµ(FRUU¶RIWKHVDPHW\SHRIVWHHOLQ )RUFRUURVLRQDVVHVVPHQWRQDVWUXFWXUDOVFDOHWKHµ(FRUU¶RIWKHVDPHW\SHRIVWHHOLQ
WKHVDPHW\SHRIFRQFUHWHLVPDSSHGZKLOHWDNLQJLQWRDFFRXQWWKHLQIOXHQFHRIH[SR WKHVDPHW\SHRIFRQFUHWHLVPDSSHGZKLOHWDNLQJLQWRDFFRXQWWKHLQIOXHQFHRIH[SR
VXUHFRQGLWLRQV+RZHYHUODERUDWRU\LQYHVWLJDWLRQVJHQHUDOO\DLPDWWHVWLQJWKHHIIHFW VXUHFRQGLWLRQV+RZHYHUODERUDWRU\LQYHVWLJDWLRQVJHQHUDOO\DLPDWWHVWLQJWKHHIIHFW
RIHJGLIIHUHQWUHLQIRUFHPHQWPDWHULDOVVXUIDFHPRGLILFDWLRQVFRQFUHWHW\SHVRULQ RIHJGLIIHUHQWUHLQIRUFHPHQWPDWHULDOVVXUIDFHPRGLILFDWLRQVFRQFUHWHW\SHVRULQ
KLELWRUVRQFRUURVLRQLQLWLDWLRQDQGSURSDJDWLRQ7KHVHIDFWRUVPD\KDYHDFRQVLGHU KLELWRUVRQFRUURVLRQLQLWLDWLRQDQGSURSDJDWLRQ7KHVHIDFWRUVPD\KDYHDFRQVLGHU
DEOHLQIOXHQFHRQµ(FRUU¶LQWKHSDVVLYHVWDWHDQGKHQFHRQWKHSRWHQWLDOGURSZLWKFRU DEOHLQIOXHQFHRQµ(FRUU¶LQWKHSDVVLYHVWDWHDQGKHQFHRQWKHSRWHQWLDOGURSZLWKFRU
URVLRQLQLWLDWLRQ2QWKHRQHKDQGWKHVHIDFWRUVOLPLWDSSOLFDWLRQRIµ(FRUU¶PRQLWRULQJ URVLRQLQLWLDWLRQ2QWKHRQHKDQGWKHVHIDFWRUVOLPLWDSSOLFDWLRQRIµ(FRUU¶PRQLWRULQJ
IRUWKHDVVHVVPHQWRIWKHFRUURVLRQVWDWH2QWKHRWKHUKDQGWKHGLIIHUHQFHVREVHUYHG IRUWKHDVVHVVPHQWRIWKHFRUURVLRQVWDWH2QWKHRWKHUKDQGWKHGLIIHUHQFHVREVHUYHG
LQWKHSDVVLYHµ(FRUU¶DQGLQWKHSRWHQWLDOGURSFRQWDLQXVHIXOWKHUPRG\QDPLFLQIRUPD LQWKHSDVVLYHµ(FRUU¶DQGLQWKHSRWHQWLDOGURSFRQWDLQXVHIXOWKHUPRG\QDPLFLQIRUPD
WLRQRQWKHDFWXDOSURWHFWLRQDQGFRUURVLRQPHFKDQLVPV WLRQRQWKHDFWXDOSURWHFWLRQDQGFRUURVLRQPHFKDQLVPV
'HWDLOVRQWKHLPSOHPHQWDWLRQRIµ(FRUU¶PRQLWRULQJLQRXUILQDOH[SHULPHQWDOVHWXS FI 'HWDLOVRQWKHLPSOHPHQWDWLRQRIµ(FRUU¶PRQLWRULQJLQRXUILQDOH[SHULPHQWDOVHWXS FI
6HFWLRQ DUHJLYHQLQ6HFWLRQ 6HFWLRQ DUHJLYHQLQ6HFWLRQ

 &RUURVLRQ&XUUHQW0RQLWRULQJ  &RUURVLRQ&XUUHQW0RQLWRULQJ


/DERUDWRU\WHVWLQJXVXDOO\WDUJHWVDWWKHH[DFWWLPHRIFRUURVLRQLQLWLDWLRQDVZHOODVDW /DERUDWRU\WHVWLQJXVXDOO\WDUJHWVDWWKHH[DFWWLPHRIFRUURVLRQLQLWLDWLRQDVZHOODVDW
WKHFRUURVLRQUDWH:HFRQVLGHUFXUUHQWPRQLWRULQJWREHDPRUHSUHFLVHWHFKQLTXHIRU WKHFRUURVLRQUDWH:HFRQVLGHUFXUUHQWPRQLWRULQJWREHDPRUHSUHFLVHWHFKQLTXHIRU
TXDQWLI\LQJ WKH RQVHW RI DFWLYH FRUURVLRQ WKDQ µ(FRUU¶ PRQLWRULQJ DQG LQ FRQWUDVW WR TXDQWLI\LQJ WKH RQVHW RI DFWLYH FRUURVLRQ WKDQ µ(FRUU¶ PRQLWRULQJ DQG LQ FRQWUDVW WR
µ(FRUU¶PRQLWRULQJLWFDQSURYLGHLQIRUPDWLRQRQWKHFRUURVLRQUDWH,QSULQFLSOHWKHUH µ(FRUU¶PRQLWRULQJLWFDQSURYLGHLQIRUPDWLRQRQWKHFRUURVLRQUDWH,QSULQFLSOHWKHUH
DUHWZRPHWKRGVIRUFXUUHQWPRQLWRULQJUHOHYDQWIRUUHLQIRUFHPHQWFRUURVLRQWHVWLQJ DUHWZRPHWKRGVIRUFXUUHQWPRQLWRULQJUHOHYDQWIRUUHLQIRUFHPHQWFRUURVLRQWHVWLQJ
LHPDFURFHOOFXUUHQWPRQLWRULQJ FI6HFWLRQ DQGSRWHQWLRVWDWLFPRQLWRULQJ FI LHPDFURFHOOFXUUHQWPRQLWRULQJ FI6HFWLRQ DQGSRWHQWLRVWDWLFPRQLWRULQJ FI
6HFWLRQ  6HFWLRQ 
$VPHQWLRQHGLQ6HFWLRQPDFURFHOOFXUUHQWPRQLWRULQJLVEDVHGRQWKHFUHDWLRQ $VPHQWLRQHGLQ6HFWLRQPDFURFHOOFXUUHQWPRQLWRULQJLVEDVHGRQWKHFUHDWLRQ
RI D JDOYDQLF FHOO DQG PHDVXULQJ RI WKH µLPDF¶ RYHU D UHVLVWRU RU HYHQ EHWWHU RYHU D RI D JDOYDQLF FHOO DQG PHDVXULQJ RI WKH µLPDF¶ RYHU D UHVLVWRU RU HYHQ EHWWHU RYHU D
]HURLPSHGDQFH DPPHWHU ZLWKRXW LQWURGXFLQJ UHVLVWLYLW\ WR WKH V\VWHP 7KH UHEDU ]HURLPSHGDQFH DPPHWHU ZLWKRXW LQWURGXFLQJ UHVLVWLYLW\ WR WKH V\VWHP 7KH UHEDU
UHSUHVHQWVWKHDQRGHRIWKHJDOYDQLFFHOODQGWKHFDWKRGHFDQHLWKHUEHHPEHGGHGLQ UHSUHVHQWVWKHDQRGHRIWKHJDOYDQLFFHOODQGWKHFDWKRGHFDQHLWKHUEHHPEHGGHGLQ
WKHVSHFLPHQ HJ>6FKLH‰O 5DXSDFK$670*@ RUVXEPHUJHGLQ WKHVSHFLPHQ HJ>6FKLH‰O 5DXSDFK$670*@ RUVXEPHUJHGLQ
WKHH[SRVXUHVROXWLRQ HJ>%XHQIHOGHWDO@ (PEHGGLQJDOORZVWKHXVHRIRU WKHH[SRVXUHVROXWLRQ HJ>%XHQIHOGHWDO@ (PEHGGLQJDOORZVWKHXVHRIRU

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 3UHOLPLQDU\7HVWLQJ$VSHFWVDQG5HTXLUHPHQWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 3UHOLPLQDU\7HVWLQJ$VSHFWVDQG5HTXLUHPHQWV

GLQDU\FDUERQVWHHODVDFDWKRGHLIWKHFDUERQVWHHOLVSRVLWLRQHGLQFDWKRGLFORFDWLRQV GLQDU\FDUERQVWHHODVDFDWKRGHLIWKHFDUERQVWHHOLVSRVLWLRQHGLQFDWKRGLFORFDWLRQV
>6FKLH‰O 5DXSDFK@<HWRIWHQLQHUWFDWKRGHVHJVWDLQOHVVVWHHORUJUDSKLWH >6FKLH‰O 5DXSDFK@<HWRIWHQLQHUWFDWKRGHVHJVWDLQOHVVVWHHORUJUDSKLWH
DUHXVHGZKLFKDOORZVDUELWUDU\SRVLWLRQLQJDQGDVPDOOHUVSHFLPHQVL]H DUHXVHGZKLFKDOORZVDUELWUDU\SRVLWLRQLQJDQGDVPDOOHUVSHFLPHQVL]H
$VDQH[WHUQDOFDWKRGHµ(&DW¶LHDFDWKRGHVXEPHUJHGLQWKHH[SRVXUHVROXWLRQRQO\ $VDQH[WHUQDOFDWKRGHµ(&DW¶LHDFDWKRGHVXEPHUJHGLQWKHH[SRVXUHVROXWLRQRQO\
PDWHULDOVZKLFKDUHLQHUWDQGQREOHUWKDQWKHSDVVLYHVWHHOUHEDUHPEHGGHGLQWKHWHVW PDWHULDOVZKLFKDUHLQHUWDQGQREOHUWKDQWKHSDVVLYHVWHHOUHEDUHPEHGGHGLQWKHWHVW
VSHFLPHQFDQEHXVHG)RULQVWDQFHDFWLYDWHG7LLVDQLQHUWQREOHDQGHOHFWURFKHPL VSHFLPHQFDQEHXVHG)RULQVWDQFHDFWLYDWHG7LLVDQLQHUWQREOHDQGHOHFWURFKHPL
FDOO\DFWLYHPDWHULDO FI6HFWLRQ DQGKDVEHHQVXFFHVVIXOO\XVHGDVDQH[WHUQDO FDOO\DFWLYHPDWHULDO FI6HFWLRQ DQGKDVEHHQVXFFHVVIXOO\XVHGDVDQH[WHUQDO
FDWKRGH HJ>%XHQIHOGHWDO@  FDWKRGH HJ>%XHQIHOGHWDO@ 
7KHVHFRQGRSWLRQIRUFXUUHQWPRQLWRULQJLHSRWHQWLRVWDWLFPRQLWRULQJLVEDVHGRQ 7KHVHFRQGRSWLRQIRUFXUUHQWPRQLWRULQJLHSRWHQWLRVWDWLFPRQLWRULQJLVEDVHGRQ
PRQLWRULQJ WKH FRUURVLRQ DFWLYLW\ E\ PHDVXULQJ WKH FXUUHQW ZKLFK LV SDVVHG IURP D PRQLWRULQJ WKH FRUURVLRQ DFWLYLW\ E\ PHDVXULQJ WKH FXUUHQW ZKLFK LV SDVVHG IURP D
µ&(¶WRWKHUHEDULHWKHµ:(¶WRPDLQWDLQLWVµ(FRUU¶E\PHDQVRIDSRWHQWLRVWDW FI µ&(¶WRWKHUHEDULHWKHµ:(¶WRPDLQWDLQLWVµ(FRUU¶E\PHDQVRIDSRWHQWLRVWDW FI
6HFWLRQ  7KH µ&(¶ LV HLWKHU HPEHGGHG LQ WKH VDPSOH HJ >$UXS  6¡UHQVHQ 6HFWLRQ  7KH µ&(¶ LV HLWKHU HPEHGGHG LQ WKH VDPSOH HJ >$UXS  6¡UHQVHQ
 6DQGEHUJ @  RU VXEPHUJHG LQ WKH H[SRVXUH VROXWLRQ HJ >1\JDDUG   6DQGEHUJ @  RU VXEPHUJHG LQ WKH H[SRVXUH VROXWLRQ HJ >1\JDDUG 
*HLNHU@  *HLNHU@ 
8QOLNHWKHFXUUHQWVXSSOLHGIURPWKHµ&(¶WRPDLQWDLQWKHUHEDUSRWHQWLDOLQSRWHQWLR 8QOLNHWKHFXUUHQWVXSSOLHGIURPWKHµ&(¶WRPDLQWDLQWKHUHEDUSRWHQWLDOLQSRWHQWLR
VWDWLF PRQLWRULQJ WKH PDFURFHOO FXUUHQW UHIOHFWV WKH FRUURVLRQ FXUUHQW ZKLFK PHDQV VWDWLF PRQLWRULQJ WKH PDFURFHOO FXUUHQW UHIOHFWV WKH FRUURVLRQ FXUUHQW ZKLFK PHDQV
WKDW WKH PHDVXUHG FXUUHQW FDQ EH XVHG IRU DQ HVWLPDWLRQ RI WKH FRUURVLRQ UDWH 7KH WKDW WKH PHDVXUHG FXUUHQW FDQ EH XVHG IRU DQ HVWLPDWLRQ RI WKH FRUURVLRQ UDWH 7KH
PHDVXUHGFXUUHQWFDQDOVREHLQWHJUDWHGDQGH[SUHVVHGDVWKHFXUUHQWFKDUJHSDVVHG PHDVXUHG FXUUHQW FDQ DOVREH LQWHJUDWHGDQGH[SUHVVHGDVWKHFXUUHQWFKDUJHSDVVHG
+RZHYHU PDFURFHOO FXUUHQW RQO\ UHSUHVHQWV D FHUWDLQ IUDFWLRQ RI WKH WRWDO FRUURVLRQ +RZHYHU PDFURFHOO FXUUHQW RQO\ UHSUHVHQWV D FHUWDLQ IUDFWLRQ RI WKH WRWDO FRUURVLRQ
DFWLYLW\ EHFDXVH WKH ORFDOLVHG PLFURFHOO FRUURVLRQ DFWLYLW\ RQ WKH UHEDU LWVHOI LV QRW DFWLYLW\ EHFDXVH WKH ORFDOLVHG PLFURFHOO FRUURVLRQ DFWLYLW\ RQ WKH UHEDU LWVHOI LV QRW
DFFHVVHG FI6HFWLRQVDQG  DFFHVVHG FI6HFWLRQVDQG 
,QERWKFRQILJXUDWLRQVSRWHQWLRVWDWLFFRQWURODQGPDFURFHOOFUHDWLRQDVKDUSDQGGH ,QERWKFRQILJXUDWLRQVSRWHQWLRVWDWLFFRQWURODQGPDFURFHOOFUHDWLRQDVKDUSDQGGH
ILQHGULVHLQWKHPRQLWRUHGFXUUHQWHJIURPDIHZPLFURDPSVWRWHQVDQGKXQGUHGVRI ILQHGULVHLQWKHPRQLWRUHGFXUUHQWHJIURPDIHZPLFURDPSVWRWHQVDQGKXQGUHGVRI
PLFURDPSVLQGLFDWHVWKHRQVHWRIDFWLYHFRUURVLRQ7KLVPHDQV WKDW FRUURVLRQ LQLWLD PLFURDPSVLQGLFDWHVWKHRQVHWRIDFWLYHFRUURVLRQ7KLVPHDQV WKDW FRUURVLRQ LQLWLD
WLRQFDQEHTXDQWLILHGPRUHSUHFLVHO\WKDQE\µ(FRUU¶PRQLWRULQJ7KHGLVDGYDQWDJHRI WLRQFDQEHTXDQWLILHGPRUHSUHFLVHO\WKDQE\µ(FRUU¶PRQLWRULQJ7KHGLVDGYDQWDJHRI
FXUUHQW PRQLWRULQJ LV WKDW LW DIIHFWV WKH WKHUPRG\QDPLFV RI WKH UHEDU 7KH XVH RI DQ FXUUHQW PRQLWRULQJ LV WKDW LW DIIHFWV WKH WKHUPRG\QDPLFV RI WKH UHEDU 7KH XVH RI DQ
HPEHGGHGUHEDUDVDFDWKRGHLQGHILQHGSRVLWLRQVKDVWKHOHDVWLPSDFWEXWUHVWULFWVWKH HPEHGGHGUHEDUDVDFDWKRGHLQGHILQHGSRVLWLRQVKDVWKHOHDVWLPSDFWEXWUHVWULFWVWKH
OD\RXWRIWKHWHVWVSHFLPHQVDQGH[SRVXUHVHWXS3RWHQWLRVWDWLFFRQWUROGRHVQRWDOORZ OD\RXWRIWKHWHVWVSHFLPHQVDQGH[SRVXUHVHWXS3RWHQWLRVWDWLFFRQWUROGRHVQRWDOORZ
DQ\ FRQFOXVLRQVEDVHGRQµ(FRUU¶PRQLWRULQJEHFDXVHµ(FRUU¶LVIL[HG0RUHRYHULWLV DQ\ FRQFOXVLRQVEDVHGRQµ(FRUU¶PRQLWRULQJEHFDXVHµ(FRUU¶LVIL[HG0RUHRYHULWLV
XQFOHDUKRZPXFKHIIHFWDFRQVWUDLQHGµ(FRUU¶KDVRQFRUURVLRQLQLWLDWLRQ,QFRQWUDVWWR XQFOHDUKRZPXFKHIIHFWDFRQVWUDLQHGµ(FRUU¶KDVRQFRUURVLRQLQLWLDWLRQ,QFRQWUDVWWR
SRWHQWLRVWDWLFFRQWUROPDFURFHOOFUHDWLRQWROHUDWHVIOXFWXDWLRQVRIWKHUHEDUSRWHQWLDO SRWHQWLRVWDWLFFRQWUROPDFURFHOOFUHDWLRQWROHUDWHVIOXFWXDWLRQVRIWKHUHEDUSRWHQWLDO
EXWDQREOHµ(&DW¶UDLVHVWKHµ(FRUU¶RIWKHUHEDUDQGWKXVKDVDVLJQLILFDQWHIIHFWRQ EXWDQREOHµ(&DW¶UDLVHVWKHµ(FRUU¶RIWKHUHEDUDQGWKXVKDVDVLJQLILFDQWHIIHFWRQ
WKHWKHUPRG\QDPLFVWDWHDQGDFFRUGLQJO\RQFRUURVLRQLQLWLDWLRQDQGSURSDJDWLRQ WKHWKHUPRG\QDPLFVWDWHDQGDFFRUGLQJO\RQFRUURVLRQLQLWLDWLRQDQGSURSDJDWLRQ
$V LQGLFDWHG LQ 6HFWLRQ  ZH VHOHFWHG PDFURFHOO FUHDWLRQ E\ PHDQV RI D QREOH $V LQGLFDWHG LQ 6HFWLRQ  ZH VHOHFWHG PDFURFHOO FUHDWLRQ E\ PHDQV RI D QREOH
µ(&DW¶DVPHWKRGIRUFXUUHQWPRQLWRULQJ7KLVDSSURDFKLVUHDVRQHGLQ6HFWLRQ µ(&DW¶DVPHWKRGIRUFXUUHQWPRQLWRULQJ7KLVDSSURDFKLVUHDVRQHGLQ6HFWLRQ
ZKHUHDOVRLWVLPSOHPHQWDWLRQLQWKHILQDOWHVWVHWXSLVLQWURGXFHG ZKHUHDOVRLWVLPSOHPHQWDWLRQLQWKHILQDOWHVWVHWXSLVLQWURGXFHG

 (OHFWURFKHPLFDO,PSHGDQFH6SHFWURVFRS\  (OHFWURFKHPLFDO,PSHGDQFH6SHFWURVFRS\


7KHDGYDQWDJHRIERWKSRWHQWLDODQGFXUUHQWPHDVXUHPHQWLVWKDWWKHVHWHFKQLTXHVFDQ 7KHDGYDQWDJHRIERWKSRWHQWLDODQGFXUUHQWPHDVXUHPHQWLVWKDWWKHVHWHFKQLTXHVFDQ
EH FDUULHG RXW DV FRQWLQXRXV PRQLWRULQJ $QRWKHU FRUURVLRQ DVVHVVPHQW WHFKQLTXH EH FDUULHG RXW DV FRQWLQXRXV PRQLWRULQJ $QRWKHU FRUURVLRQ DVVHVVPHQW WHFKQLTXH

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3UHOLPLQDU\7HVWLQJ$VSHFWVDQG5HTXLUHPHQWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 3UHOLPLQDU\7HVWLQJ$VSHFWVDQG5HTXLUHPHQWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV

µ(,6¶ LV QRW SHUIRUPHG DV FRQWLQXRXV PRQLWRULQJ EXW DV LQGLYLGXDO UXQV µ(,6¶ LV µ(,6¶ LV QRW SHUIRUPHG DV FRQWLQXRXV PRQLWRULQJ EXW DV LQGLYLGXDO UXQV µ(,6¶ LV
EDVHGRQWKHVDPHSULQFLSOHVDVSRODULVDWLRQUHVLVWDQFHPHDVXUHPHQWEXWVPDOOSRWHQ EDVHGRQWKHVDPHSULQFLSOHVDVSRODULVDWLRQUHVLVWDQFHPHDVXUHPHQWEXWVPDOOSRWHQ
WLDOSHUWXUEDWLRQµ¨(S¶LQWKHRUGHURIHJP9LVDSSOLHGWRWKHUHEDUDWYDU\LQJIUH WLDOSHUWXUEDWLRQµ¨(S¶LQWKHRUGHURIHJP9LVDSSOLHGWRWKHUHEDUDWYDU\LQJIUH
TXHQFLHV DQG WKH UHVXOWLQJ GHQVLW\ UHVSRQVH µ¨LS¶ LV PHDVXUHG FI 6HFWLRQ   ,Q TXHQFLHV DQG WKH UHVXOWLQJ GHQVLW\ UHVSRQVH µ¨LS¶ LV PHDVXUHG FI 6HFWLRQ   ,Q
WKLV ZD\ YDOXDEOH LQIRUPDWLRQ RQ D QXPEHU RI SDUDPHWHUV FRQFHUQLQJ WKH SUHVHQFH WKLV ZD\ YDOXDEOH LQIRUPDWLRQ RQ D QXPEHU RI SDUDPHWHUV FRQFHUQLQJ WKH SUHVHQFH
DQGFKDUDFWHULVWLFVRISDVVLYHOD\HUVDVZHOODVRQWKHEXONFRQFUHWH RUPRUWDUFHPHQW DQGFKDUDFWHULVWLFVRISDVVLYHOD\HUVDVZHOODVRQWKHEXONFRQFUHWH RUPRUWDUFHPHQW
SDVWH FI 6HFWLRQ   DWWULEXWHV DUH REWDLQHG ZLWK YHU\ OLPLWHG SHUWXUEDWLRQ RI SDVWH FI 6HFWLRQ   DWWULEXWHV DUH REWDLQHG ZLWK YHU\ OLPLWHG SHUWXUEDWLRQ RI
µ(FRUU¶ $GGLWLRQDO EDFNJURXQG LQIRUPDWLRQ RQ WKH DSSOLFDWLRQ RI µ(,6¶ IRU WHVWLQJ RI µ(FRUU¶ $GGLWLRQDO EDFNJURXQG LQIRUPDWLRQ RQ WKH DSSOLFDWLRQ RI µ(,6¶ IRU WHVWLQJ RI
UHLQIRUFHPHQW FRUURVLRQ DQG FRPSDULVRQV WR RWKHU HOHFWURFKHPLFDO PHWKRGV LV DYDLO UHLQIRUFHPHQW FRUURVLRQ DQG FRPSDULVRQV WR RWKHU HOHFWURFKHPLFDO PHWKRGV LV DYDLO
DEOH LQ WKH OLWHUDWXUH HJ >%HUNH  +LFNV  6DJpV  %HQWXU HWDO  DEOH LQ WKH OLWHUDWXUH HJ >%HUNH  +LFNV  6DJpV  %HQWXU HWDO 
.ROHYDHWDO@  .ROHYDHWDO@ 
$V PHQWLRQHG LQ 6HFWLRQ  µ(,6¶ GDWD FDQ EH UHSUHVHQWHG E\ HLWKHU 1\TXLVW RU $V PHQWLRQHG LQ 6HFWLRQ  µ(,6¶ GDWD FDQ EH UHSUHVHQWHG E\ HLWKHU 1\TXLVW RU
%RGHSORWVRXUDQDO\VLVZDVIRFXVHGRQ1\TXLVWSORWV7KDWLVGXHWRWKHDGYDQWDJHRI %RGHSORWVRXUDQDO\VLVZDVIRFXVHGRQ1\TXLVWSORWV7KDWLVGXHWRWKHDGYDQWDJHRI
1\TXLVWSORWVLQSURYLGLQJDEHQHILFLDORYHUYLHZRIWKHGDWDDOORZLQJUDSLGTXDOLWDWLYH 1\TXLVWSORWVLQSURYLGLQJDEHQHILFLDORYHUYLHZRIWKHGDWDDOORZLQJUDSLGTXDOLWDWLYH
LQWHUSUHWDWLRQV 'HSHQGLQJ RQ WKH FRQILJXUDWLRQ DQG IUHTXHQF\ UDQJH 1\TXLVW SORWV LQWHUSUHWDWLRQV 'HSHQGLQJ RQ WKH FRQILJXUDWLRQ DQG IUHTXHQF\ UDQJH 1\TXLVW SORWV
VKRZIUDFWLRQVRIWZRDUFVVHSDUDWHGE\DFXVS7KHILUVWDUFUHSUHVHQWVWKHEXONUHVLV VKRZIUDFWLRQVRIWZRDUFVVHSDUDWHGE\DFXVS7KHILUVWDUFUHSUHVHQWVWKHEXONUHVLV
WLYLW\HJWKHUHVLVWLYLW\RIWKHPRUWDUEHWZHHQWKHHPEHGGHGµ5(V¶DQGWKHµ:(¶ FI WLYLW\HJWKHUHVLVWLYLW\RIWKHPRUWDUEHWZHHQWKHHPEHGGHGµ5(V¶DQGWKHµ:(¶ FI
6HFWLRQ ZKLOHWKHVHFRQGDUFUHSUHVHQWVWKHUHVLVWLYLW\RIWKHµ:(¶VXUIDFHLH 6HFWLRQ ZKLOHWKHVHFRQGDUFUHSUHVHQWVWKHUHVLVWLYLW\RIWKHµ:(¶VXUIDFHLH
WKH WKHUPRG\QDPLF VWDWH RI WKH UHEDU 7KLV LOOXVWUDWLYH UHSUHVHQWDWLRQ DOORZV IRU LQ WKH WKHUPRG\QDPLF VWDWH RI WKH UHEDU 7KLV LOOXVWUDWLYH UHSUHVHQWDWLRQ DOORZV IRU LQ
VLJKWIXOFRPSDULVRQVRIGDWD)RULQVWDQFHFRPSDULVRQRI1\TXLVWSORWVRI WKH VDPH VLJKWIXOFRPSDULVRQVRIGDWD)RULQVWDQFHFRPSDULVRQRI1\TXLVWSORWVRI WKH VDPH
VSHFLPHQVDWGLIIHUHQWWLPHLQWHUYDOVSURYLGHVLQIRUPDWLRQRQFKDQJHVLQWKHHOHFWUR VSHFLPHQVDWGLIIHUHQWWLPHLQWHUYDOVSURYLGHVLQIRUPDWLRQRQFKDQJHVLQWKHHOHFWUR
FKHPLFDOSURSHUWLHVRIWKHUHEDUVXUIDFHDQGWKHEXONEHWZHHQWKHUHEDUDQGWKHµ5(¶ FKHPLFDOSURSHUWLHVRIWKHUHEDUVXUIDFHDQGWKHEXONEHWZHHQWKHUHEDUDQGWKHµ5(¶
0RUHRYHU D ORW RI LQIRUPDWLRQ FDQ EH REWDLQHG E\ FRPSDULQJ µ(,6¶ GDWD IURP WKH 0RUHRYHU D ORW RI LQIRUPDWLRQ FDQ EH REWDLQHG E\ FRPSDULQJ µ(,6¶ GDWD IURP WKH
VDPH WLPH LQWHUYDO IRU VSHFLPHQV ZLWK GLIIHUHQW SURSHUWLHV HJ FRQFUHWH PL[HV DQG VDPH WLPH LQWHUYDO IRU VSHFLPHQV ZLWK GLIIHUHQW SURSHUWLHV HJ FRQFUHWH PL[HV DQG
DGGLWLRQVVWHHOTXDOLWLHVDQGVWHHOVXUIDFHSURSHUWLHV>.WHUHWDOE@&RQFOXVLYH DGGLWLRQVVWHHOTXDOLWLHVDQGVWHHOVXUIDFHSURSHUWLHV>.WHUHWDOE@&RQFOXVLYH
LGHQWLILFDWLRQRIWKHFRUURVLRQVWDWHFDQDOVREHDFKLHYHGEDVHGRQLQGLYLGXDOUXQVHJ LGHQWLILFDWLRQRIWKHFRUURVLRQVWDWHFDQDOVREHDFKLHYHGEDVHGRQLQGLYLGXDOUXQVHJ
PHDVXUHGLQWKHORZIUHTXHQF\GRPDLQDURXQGP+]>%HQWXUHWDO@ PHDVXUHGLQWKHORZIUHTXHQF\GRPDLQDURXQGP+]>%HQWXUHWDO@
7RREWDLQUHSUHVHQWDWLYHDQGUHSURGXFLEOHGDWDLVKDVWREHDVVXUHGWKDWFRQGLWLRQVDUH 7RREWDLQUHSUHVHQWDWLYHDQGUHSURGXFLEOHGDWDLVKDVWREHDVVXUHGWKDWFRQGLWLRQVDUH
VWDEOHGXULQJWKHµ(,6¶UXQµ(,6¶GDWDLVODUJHO\DIIHFWHGE\WKHJHRPHWU\DQGOD\RXW VWDEOHGXULQJWKHµ(,6¶UXQµ(,6¶GDWDLVODUJHO\DIIHFWHGE\WKHJHRPHWU\DQGOD\RXW
RIWKHWHVWVSHFLPHQ>$QGUDGHHWDOE@,QSDUWLFXODUWKHSRVLWLRQJHRPHWU\DQG RIWKHWHVWVSHFLPHQ>$QGUDGHHWDOE@,QSDUWLFXODUWKHSRVLWLRQJHRPHWU\DQG
HOHFWURFKHPLFDOSURSHUWLHVRIWKHµ5(¶KDYHDVLJQLILFDQWHIIHFWRQWKHPHDVXUHPHQWV HOHFWURFKHPLFDOSURSHUWLHVRIWKHµ5(¶KDYHDVLJQLILFDQWHIIHFWRQWKHPHDVXUHPHQWV
>+VLHKHWDO+VLHKHWDO@6RZLWKUHJDUGWRVWDELOLW\DWORZIUHTXHQFLHV >+VLHKHWDO+VLHKHWDO@6RZLWKUHJDUGWRVWDELOLW\DWORZIUHTXHQFLHV
DQGHYHQPRUHLPSRUWDQWO\LQRUGHUWRJHQHUDOO\SURYLGHIRUUHSURGXFLELOLW\RIGDWD DQGHYHQPRUHLPSRUWDQWO\LQRUGHUWRJHQHUDOO\SURYLGHIRUUHSURGXFLELOLW\RIGDWD
VSHFLDO GHVLJQ FRQVLGHUDWLRQV DUH QHFHVVDU\ IRU WKH WHVW VSHFLPHQ DQG WKH DSSOLHG VSHFLDO GHVLJQ FRQVLGHUDWLRQV DUH QHFHVVDU\ IRU WKH WHVW VSHFLPHQ DQG WKH DSSOLHG
HTXLSPHQW 2XU SULQFLSDO (,6 VSHFLPHQ LH WKH LQVWUXPHQWHG PRUWDU VSHFLPHQ FI HTXLSPHQW 2XU SULQFLSDO (,6 VSHFLPHQ LH WKH LQVWUXPHQWHG PRUWDU VSHFLPHQ FI
6HFWLRQ   ZDV GHVLJQHG WR PHHW WKHVH UHTXLUHPHQWV 7KH IHDWXUHV RI WKH LQVWUX 6HFWLRQ   ZDV GHVLJQHG WR PHHW WKHVH UHTXLUHPHQWV 7KH IHDWXUHV RI WKH LQVWUX
PHQWHG PRUWDU VSHFLPHQ DQG RXU LPSOHPHQWDWLRQ RI (,6 PHDVXUHPHQWV RQ WKH ILQDO PHQWHG PRUWDU VSHFLPHQ DQG RXU LPSOHPHQWDWLRQ RI (,6 PHDVXUHPHQWV RQ WKH ILQDO
WHVWVHWXSDUHGHVFULEHGLQPRUHGHWDLOLQ6HFWLRQVDQGUHVSHFWLYHO\ WHVWVHWXSDUHGHVFULEHGLQPRUHGHWDLOLQ6HFWLRQVDQGUHVSHFWLYHO\

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 3UHOLPLQDU\7HVWLQJ$VSHFWVDQG5HTXLUHPHQWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 3UHOLPLQDU\7HVWLQJ$VSHFWVDQG5HTXLUHPHQWV

 3RODULVDWLRQ&XUYHV  3RODULVDWLRQ&XUYHV


7KHWKHRU\EHKLQGSRODULVDWLRQFXUYHVLQDTXHRXVPHWDOOLFFRUURVLRQDQGWKHLUDSSOLFD 7KHWKHRU\EHKLQGSRODULVDWLRQFXUYHVLQDTXHRXVPHWDOOLFFRUURVLRQDQGWKHLUDSSOLFD
WLRQ DV D PHDVXUHPHQW WHFKQLTXH DUH GLVFXVVHG LQ 6HFWLRQV  DQG  UHVSHF WLRQ DV D PHDVXUHPHQW WHFKQLTXH DUH GLVFXVVHG LQ 6HFWLRQV  DQG  UHVSHF
WLYHO\,WZDVHPSKDVLVHGWKDWSRODULVDWLRQFXUYHVFDQEHXVHIXOLQGHWHUPLQLQJWKHUDWH WLYHO\,WZDVHPSKDVLVHGWKDWSRODULVDWLRQFXUYHVFDQEHXVHIXOLQGHWHUPLQLQJWKHUDWH
RI WKH DQRGLF DQG FDWKRGLF UHDFWLRQV WKDW WDNH SODFH DW D FHUWDLQ HOHFWURGH SRWHQWLDO RI WKH DQRGLF DQG FDWKRGLF UHDFWLRQV WKDW WDNH SODFH DW D FHUWDLQ HOHFWURGH SRWHQWLDO
8QIRUWXQDWHO\ GHWHUPLQDWLRQ RI SRODULVDWLRQ FXUYHV LV PXFK PRUH FRPSOLFDWHG IRU 8QIRUWXQDWHO\ GHWHUPLQDWLRQ RI SRODULVDWLRQ FXUYHV LV PXFK PRUH FRPSOLFDWHG IRU
PHWDOVLQFRQFUHWH RUPRUWDUFHPHQWSDVWHFI6HFWLRQ WKDQIRUPHWDOVLQDTXH PHWDOVLQFRQFUHWH RUPRUWDUFHPHQWSDVWHFI6HFWLRQ WKDQIRUPHWDOVLQDTXH
RXVVROXWLRQV7KHPDLQSUREOHPLVWKDWGLIIXVLRQSKHQRPHQDLQWKHFHPHQWSDVWHDUH RXVVROXWLRQV7KHPDLQSUREOHPLVWKDWGLIIXVLRQSKHQRPHQDLQWKHFHPHQWSDVWHDUH
YHU\ VORZ FI 6HFWLRQV   DQG   %HVLGHV WKH VORZ NLQHWLFV WKH YHU\ VORZ FI 6HFWLRQV   DQG   %HVLGHV WKH VORZ NLQHWLFV WKH
SK\VLFDODQGFKHPLFDOFRQGLWLRQVRIWKHFRQFUHWHVWHHOLQWHUIDFHDQGWKHEXONDUHEHLQJ SK\VLFDODQGFKHPLFDOFRQGLWLRQVRIWKHFRQFUHWHVWHHOLQWHUIDFHDQGWKHEXONDUHEHLQJ
DOWHUHG GXULQJ WKH PHDVXUHPHQW FI 6HFWLRQV  DQG   RU FUDFNLQJ PD\ DOWHUHG GXULQJ WKH PHDVXUHPHQW FI 6HFWLRQV  DQG   RU FUDFNLQJ PD\
FKDQJHWKHSURSHUWLHVRIWKHLQYHVWLJDWHGV\VWHPHQWLUHO\ FI6HFWLRQ 0RUH FKDQJHWKHSURSHUWLHVRIWKHLQYHVWLJDWHGV\VWHPHQWLUHO\ FI6HFWLRQ 0RUH
RYHUUHVLVWDQFHHIIHFWVLHWKHFRPELQHGUHVLVWDQFHRIWKHVROXWLRQDQGWKHFRQFUHWH RYHUUHVLVWDQFHHIIHFWVLHWKHFRPELQHGUHVLVWDQFHRIWKHVROXWLRQDQGWKHFRQFUHWH
RUPRUWDUFHPHQWSDVWHFI6HFWLRQ EXONEHWZHHQWKHµ:(¶DQGWKHµ5(¶DUHRI RUPRUWDUFHPHQWSDVWHFI6HFWLRQ EXONEHWZHHQWKHµ:(¶DQGWKHµ5(¶DUHRI
SDUWLFXODU LPSRUWDQFH IRU PHDVXUHPHQWV RQ HPEHGGHG PHWDOV 7KXV WKH VSHFLPHQ SDUWLFXODU LPSRUWDQFH IRU PHDVXUHPHQWV RQ HPEHGGHG PHWDOV 7KXV WKH VSHFLPHQ
OD\RXWDQGWKHPHDVXUHPHQWSDUDPHWHUVDUHWREHFKRVHQZLWKGXHUHJDUGWRSRODULVD OD\RXWDQGWKHPHDVXUHPHQWSDUDPHWHUVDUHWREHFKRVHQZLWKGXHUHJDUGWRSRODULVD
WLRQFXUYHPHDVXUHPHQWV$VPHQWLRQHGLQ6HFWLRQWKHVFDQUDWHLVDQLPSRUWDQW WLRQFXUYHPHDVXUHPHQWV$VPHQWLRQHGLQ6HFWLRQWKHVFDQUDWHLVDQLPSRUWDQW
SDUDPHWHUIRUSRODULVDWLRQFXUYHPHDVXUHPHQWVGXHWRWKHDERYHPHQWLRQHGDVSHFWVLW SDUDPHWHUIRUSRODULVDWLRQFXUYHPHDVXUHPHQWVGXHWRWKHDERYHPHQWLRQHGDVSHFWVLW
KDVDQHYHQPRUHSURQRXQFHGHIIHFWIRUPHDVXUHPHQWVSHUIRUPHGRQHPEHGGHGPHW KDVDQHYHQPRUHSURQRXQFHGHIIHFWIRUPHDVXUHPHQWVSHUIRUPHGRQHPEHGGHGPHW
DOVHJFRQFHUQLQJGHWHUPLQDWLRQRIWKHSLWWLQJSRWHQWLDOµ(SLW¶ FI6HFWLRQV  DOVHJFRQFHUQLQJGHWHUPLQDWLRQRIWKHSLWWLQJSRWHQWLDOµ(SLW¶ FI6HFWLRQV 
:HSHUIRUPHGWKHPDMRUSDUWRIRXUSRODULVDWLRQFXUYHPHDVXUHPHQWVE\PHDQVRIWKH :HSHUIRUPHGWKHPDMRUSDUWRIRXUSRODULVDWLRQFXUYHPHDVXUHPHQWVE\PHDQVRIWKH
FHPHQW SDVWH VSHFLPHQV FI 6HFWLRQV  DQG    ,Q DGGLWLRQ WR OLPLWLQJ WKH FHPHQW SDVWH VSHFLPHQV FI 6HFWLRQV  DQG    ,Q DGGLWLRQ WR OLPLWLQJ WKH
LQIOXHQFH RI GLIIXVLRQ DQG UHVLVWDQFH HIIHFWV WKLV FKRLFH ZDV DOVR PRWLYDWHG E\ WKH LQIOXHQFH RI GLIIXVLRQ DQG UHVLVWDQFH HIIHFWV WKLV FKRLFH ZDV DOVR PRWLYDWHG E\ WKH
VLPSOHPDQXIDFWXUHRIWKHFHPHQWSDVWHVSHFLPHQVZKLFKDOORZHGIRUDODUJHWHVWLQJ VLPSOHPDQXIDFWXUHRIWKHFHPHQWSDVWHVSHFLPHQVZKLFKDOORZHGIRUDODUJHWHVWLQJ
PDWUL[RIGHVWUXFWLYHSRODULVDWLRQFXUYHPHDVXUHPHQWV PDWUL[RIGHVWUXFWLYHSRODULVDWLRQFXUYHPHDVXUHPHQWV

 $GGLWLRQDO0HDVXUHPHQW7HFKQLTXHV  $GGLWLRQDO0HDVXUHPHQW7HFKQLTXHV


,QDGGLWLRQWRWKHHOHFWURFKHPLFDOPHWKRGVGHVFULEHGLQZHFRQVLGHUWKHIROORZ ,QDGGLWLRQWRWKHHOHFWURFKHPLFDOPHWKRGVGHVFULEHGLQZHFRQVLGHUWKHIROORZ
LQJ PHDVXUHPHQW WHFKQLTXHV WR EH RI LPSRUWDQFH IRU D SHUIRUPDQFH HYDOXDWLRQ RI LQJ PHDVXUHPHQW WHFKQLTXHV WR EH RI LPSRUWDQFH IRU D SHUIRUPDQFH HYDOXDWLRQ RI
DYDLODEOHDQGQHZFRXQWHUPHDVXUHV DYDLODEOHDQGQHZFRXQWHUPHDVXUHV
‡ 0HDVXUHPHQWRIS+DQGFKORULGHFRQWHQWRIFRQFUHWH RUPRUWDUFHPHQWSDVWH DQG ‡ 0HDVXUHPHQWRIS+DQGFKORULGHFRQWHQWRIFRQFUHWH RUPRUWDUFHPHQWSDVWH DQG
H[SRVXUH VROXWLRQV E\ FKHPLFDO LQGLFDWRUV FI 6HFWLRQV   DQG H[SRVXUH VROXWLRQV E\ FKHPLFDO LQGLFDWRUV FI 6HFWLRQV   DQG
   
‡ /LJKW RSWLFDO PLFURVFRS\ µ/20¶ DQG VFDQQLQJ HOHFWURQ PLFURVFRS\ µ6(0¶ RI ‡ /LJKW RSWLFDO PLFURVFRS\ µ/20¶ DQG VFDQQLQJ HOHFWURQ PLFURVFRS\ µ6(0¶ RI
FRQFUHWH RU PRUWDUFHPHQW SDVWH FI 6HFWLRQ   UHEDU VDPSOHV LQFOXGLQJ FRQFUHWH RU PRUWDUFHPHQW SDVWH FI 6HFWLRQ   UHEDU VDPSOHV LQFOXGLQJ
 

1DWXUDOO\SRODULVDWLRQFXUYHPHDVXUHPHQWVFDQDOVREHSHUIRUPHGXVLQJUHEDUVLQVROXWLRQHJLQ 1DWXUDOO\SRODULVDWLRQFXUYHPHDVXUHPHQWVFDQDOVREHSHUIRUPHGXVLQJUHEDUVLQVROXWLRQHJLQ
VLPXODWHGSRUHVROXWLRQZLWKRUZLWKRXWWKHDGGLWLRQRIFKORULGH6XFKPHDVXUHPHQWVSOD\HGDQLP VLPXODWHGSRUHVROXWLRQZLWKRUZLWKRXWWKHDGGLWLRQRIFKORULGH6XFKPHDVXUHPHQWVSOD\HGDQLP
SRUWDQWUROHLQRXU SUHOLPLQDU\ LQYHVWLJDWLRQV+RZHYHUWKHFUXFLDOHIIHFWVDWWKHFRQFUHWHVWHHOLQ SRUWDQWUROHLQRXU SUHOLPLQDU\ LQYHVWLJDWLRQV+RZHYHUWKHFUXFLDOHIIHFWVDWWKHFRQFUHWHVWHHOLQ
WHUIDFHLHHOHFWURFKHPLFDOGHQVLILFDWLRQDQGSRUHEORFNLQJFRXOGRQO\EHDVVHVVHGE\PHDQVRIWHVW WHUIDFHLHHOHFWURFKHPLFDOGHQVLILFDWLRQDQGSRUHEORFNLQJFRXOGRQO\EHDVVHVVHGE\PHDQVRIWHVW
LQJHPEHGGHGUHEDUV LQJHPEHGGHGUHEDUV

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


3UHOLPLQDU\7HVWLQJ$VSHFWVDQG5HTXLUHPHQWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV 3UHOLPLQDU\7HVWLQJ$VSHFWVDQG5HTXLUHPHQWV 'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV

PRGLILHG  VXUIDFHV PHWDOORJUDSKLF FURVVVHFWLRQV FI 6HFWLRQV  DQG PRGLILHG  VXUIDFHV PHWDOORJUDSKLF FURVVVHFWLRQV FI 6HFWLRQV  DQG
 DQGFRQFUHWHVWHHOLQWHUIDFH  DQGFRQFUHWHVWHHOLQWHUIDFH
‡ (QHUJ\GLVSHUVLYH;UD\VSHFWURVFRS\µ('6¶EDVHGRQERWKVSHFWUDDQGPDSSLQJ ‡ (QHUJ\GLVSHUVLYH;UD\VSHFWURVFRS\µ('6¶EDVHGRQERWKVSHFWUDDQGPDSSLQJ
RIFRQFUHWH RUPRUWDUFHPHQWSDVWHFI6HFWLRQ UHEDUVDPSOHVLQFOXGLQJ RIFRQFUHWH RUPRUWDUFHPHQWSDVWHFI6HFWLRQ UHEDUVDPSOHVLQFOXGLQJ
PRGLILHG  VXUIDFHV PHWDOORJUDSKLF FURVVVHFWLRQV FI 6HFWLRQV  DQG PRGLILHG  VXUIDFHV PHWDOORJUDSKLF FURVVVHFWLRQV FI 6HFWLRQV  DQG
 DQGFRQFUHWHVWHHOLQWHUIDFH  DQGFRQFUHWHVWHHOLQWHUIDFH
7KHVH PHDVXUHPHQWV DUH RQO\ OLVWHG KHUH EXW QRW GHVFULEHG LQ GHWDLO VLQFH WKH\ DUH 7KHVH PHDVXUHPHQWV DUH RQO\ OLVWHG KHUH EXW QRW GHVFULEHG LQ GHWDLO VLQFH WKH\ DUH
ODUJHO\ EDVHG RQ VWDQGDUG WHFKQLTXHV DQG WKHLU UHOHYDQFH DQG RXU DSSOLFDWLRQ LV GH ODUJHO\ EDVHG RQ VWDQGDUG WHFKQLTXHV DQG WKHLU UHOHYDQFH DQG RXU DSSOLFDWLRQ LV GH
VFULEHGGHWDLOLQWKHUHVSHFWLYH6HFWLRQV7KHLPSOHPHQWDWLRQRIWKHVHPHDVXUHPHQWV VFULEHGGHWDLOLQWKHUHVSHFWLYH6HFWLRQV7KHLPSOHPHQWDWLRQRIWKHVHPHDVXUHPHQWV
LQFRQQHFWLRQZLWKWKHILQDOWHVWVHWXSLVGHVFULEHGLQ6HFWLRQ LQFRQQHFWLRQZLWKWKHILQDOWHVWVHWXSLVGHVFULEHGLQ6HFWLRQ
 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


 

 7HVW6HWXSDQG0HDVXULQJ0HWKRGV  7HVW6HWXSDQG0HDVXULQJ0HWKRGV
7KLV&KDSWHUGHDOVZLWKWKHILQDOSUDFWLFDOUHDOLVDWLRQRIWKHH[SRVXUHFRQGLWLRQVDQG 7KLV&KDSWHUGHDOVZLWKWKHILQDOSUDFWLFDOUHDOLVDWLRQRIWKHH[SRVXUHFRQGLWLRQVDQG
PHDVXUHPHQW WHFKQLTXHV WKDW KDYH EHHQ VXJJHVWHG LQ 6HFWLRQ  IRU WKH WHVWLQJ RI PHDVXUHPHQW WHFKQLTXHV WKDW KDYH EHHQ VXJJHVWHG LQ 6HFWLRQ  IRU WKH WHVWLQJ RI
DYDLODEOHDQGQHZFRXQWHUPHDVXUHV7KHEDVLFFRQFHSWRIWKHILQDOWHVWVHWXSDQGWKH DYDLODEOHDQGQHZFRXQWHUPHDVXUHV7KHEDVLFFRQFHSWRIWKHILQDOWHVWVHWXSDQGWKH
DSSOLHGPRQLWRULQJFRQFHSWZHUHRXWOLQHGLQ6HFWLRQ7KHWHVWVHWXSFRPSULVHV DSSOLHGPRQLWRULQJFRQFHSWZHUHRXWOLQHGLQ6HFWLRQ7KHWHVWVHWXSFRPSULVHV
WKUHHPDMRUSDUWVWKDWDUHGHVFULEHGLQWKLV&KDSWHUVSHFLPHQVVXLWDEOHIRUVWDQGDORQH WKUHHPDMRUSDUWVWKDWDUHGHVFULEHGLQWKLV&KDSWHUVSHFLPHQVVXLWDEOHIRUVWDQGDORQH
µ(FRUU¶PRQLWRULQJDQGµ(,6¶ZLWKLQGLYLGXDOµ(&DWV¶HQDEOLQJµLPDF¶PRQLWRULQJDVZHOO µ(FRUU¶PRQLWRULQJDQGµ(,6¶ZLWKLQGLYLGXDOµ(&DWV¶HQDEOLQJµLPDF¶PRQLWRULQJDVZHOO
DV VSHFLPHQV VXLWDEOH IRU PDVV SURGXFWLRQ 6HFWLRQ   D KLJK FDSDFLW\ H[SRVXUH DV VSHFLPHQV VXLWDEOH IRU PDVV SURGXFWLRQ 6HFWLRQ   D KLJK FDSDFLW\ H[SRVXUH
VHWXS 6HFWLRQ DQGDPRQLWRULQJV\VWHPFDSDEOHRIORJJLQJFRPSUHKHQVLYHGDWD VHWXS 6HFWLRQ DQGDPRQLWRULQJV\VWHPFDSDEOHRIORJJLQJFRPSUHKHQVLYHGDWD
IURP PXOWLSOH VSHFLPHQV 6HFWLRQ   7KH LPSOHPHQWDWLRQ RI WKH HOHFWURFKHPLFDO IURP PXOWLSOH VSHFLPHQV 6HFWLRQ   7KH LPSOHPHQWDWLRQ RI WKH HOHFWURFKHPLFDO
DQG DGGLWLRQDO WHFKQLTXHV SURSRVHG LQ 6HFWLRQV  DQG  LV GHDOW ZLWK LQ 6HF DQG DGGLWLRQDO WHFKQLTXHV SURSRVHG LQ 6HFWLRQV  DQG  LV GHDOW ZLWK LQ 6HF
WLRQVDQGUHVSHFWLYHO\ WLRQVDQGUHVSHFWLYHO\

 7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV  7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV


$VPHQWLRQHGLQ6HFWLRQERWKWKHHPEHGGHGHOHFWURGHZLUHVµ((:V¶RIWKHLQ $VPHQWLRQHGLQ6HFWLRQERWKWKHHPEHGGHGHOHFWURGHZLUHVµ((:V¶RIWKHLQ
VWUXPHQWHGPRUWDUVSHFLPHQDVZHOODVWKHµ(&DWV¶ZHUHPDGHRIDFWLYDWHG7L$VKRUW VWUXPHQWHGPRUWDUVSHFLPHQDVZHOODVWKHµ(&DWV¶ZHUHPDGHRIDFWLYDWHG7L$VKRUW
GHVFULSWLRQRIWKLVPDWHULDOLVJLYHQLQ6HFWLRQ7KHGHVLJQDQGPDQXIDFWXUHRI GHVFULSWLRQRIWKLVPDWHULDOLVJLYHQLQ6HFWLRQ7KHGHVLJQDQGPDQXIDFWXUHRI
WKHSULQFLSDOVSHFLPHQVDQGRIWKHµ(&DWV¶DUHGHVFULEHGLQ6HFWLRQVDQG WKHSULQFLSDOVSHFLPHQVDQGRIWKHµ(&DWV¶DUHGHVFULEHGLQ6HFWLRQVDQG
UHVSHFWLYHO\ UHVSHFWLYHO\

 $FWLYDWHG7LWDQLXP  $FWLYDWHG7LWDQLXP


7KHHPEHGGHGHOHFWURGHZLUHVµ((:V¶DQGWKHH[WHUQDOFDWKRGHVµ(&DW¶ FI6HFWLRQ 7KHHPEHGGHGHOHFWURGHZLUHVµ((:V¶DQGWKHH[WHUQDOFDWKRGHVµ(&DW¶ FI6HFWLRQ
 FRQVLVWHGRI5X,UPL[HGPHWDOR[LGH µ002¶ DFWLYDWHGWLWDQLXP,QWKHSUR  FRQVLVWHGRI5X,UPL[HGPHWDOR[LGH µ002¶ DFWLYDWHGWLWDQLXP,QWKHSUR
GXFWLRQRIDFWLYDWHG7LWKHPL[HGPHWDOR[LGHFDWDO\VWLVWKHUPDOO\DSSOLHGWRWKH7L GXFWLRQRIDFWLYDWHG7LWKHPL[HGPHWDOR[LGHFDWDO\VWLVWKHUPDOO\DSSOLHGWRWKH7L
VXEVWUDWHWRIRUPDFKHPLFDOUHVLVWDQWERQG7KLVFRPSRVLWLRQFRPELQHVWKHVWDELOLW\ VXEVWUDWHWRIRUPDFKHPLFDOUHVLVWDQWERQG7KLVFRPSRVLWLRQFRPELQHVWKHVWDELOLW\
RI7LZLWKWKHFRQGXFWLYHSURSHUWLHVRIPL[HGPHWDOR[LGHWRDFKLHYHDKLJKDQGVWDEOH RI7LZLWKWKHFRQGXFWLYHSURSHUWLHVRIPL[HGPHWDOR[LGHWRDFKLHYHDKLJKDQGVWDEOH
SRWHQWLDODORZFRQVXPSWLRQUDWHDQGKLJKFXUUHQWGHQVLWLHV%DVHGRQWKHVHSURSHU SRWHQWLDODORZFRQVXPSWLRQUDWHDQGKLJKFXUUHQWGHQVLWLHV%DVHGRQWKHVHSURSHU
WLHV DFWLYDWHG 7L LV RIWHQ WKH PDWHULDO RI FKRLFH IRU GLPHQVLRQDOO\ VWDEOH DQRGHV WLHV DFWLYDWHG 7L LV RIWHQ WKH PDWHULDO RI FKRLFH IRU GLPHQVLRQDOO\ VWDEOH DQRGHV
µ'6$V¶  LQ D ZLGH UDQJH RI HOHFWURFKHPLFDO DSSOLFDWLRQV %HVLGHV DSSOLFDWLRQ LQ µ'6$V¶  LQ D ZLGH UDQJH RI HOHFWURFKHPLFDO DSSOLFDWLRQV %HVLGHV DSSOLFDWLRQ LQ
PDQ\HOHFWURO\VLVSURFHVVHVDFWLYDWHG7LDQRGHVDUHRIWHQXVHGLQFRQQHFWLRQZLWKWKH PDQ\HOHFWURO\VLVSURFHVVHVDFWLYDWHG7LDQRGHVDUHRIWHQXVHGLQFRQQHFWLRQZLWKWKH
HOHFWURFKHPLFDOFRXQWHUPHDVXUHVLQWURGXFHGLQ6HFWLRQLHIRUµ&3UH¶DQGµ&3¶ HOHFWURFKHPLFDOFRXQWHUPHDVXUHVLQWURGXFHGLQ6HFWLRQLHIRUµ&3UH¶DQGµ&3¶
ZKLFKDUHRIWHQEDVHGRQLPSUHVVHGFXUUHQWVDVZHOODVIRUµ(5$¶DQGµ(&5¶ ZKLFKDUHRIWHQEDVHGRQLPSUHVVHGFXUUHQWVDVZHOODVIRUµ(5$¶DQGµ(&5¶
/DERUDWRU\LQYHVWLJDWLRQVKDYHVKRZQWKDWDFWLYDWHG7LKDVQRFRQVLGHUDEOHVHQVLWLYLW\ /DERUDWRU\LQYHVWLJDWLRQVKDYHVKRZQWKDWDFWLYDWHG7LKDVQRFRQVLGHUDEOHVHQVLWLYLW\
WR 1D&O DQG D VWHDG\ µ(FRUU¶ LQ VROXWLRQV DQG FRQFUHWH ZLWKRXW SR]]RODQLF DGGLWLRQV WR 1D&O DQG D VWHDG\ µ(FRUU¶ LQ VROXWLRQV DQG FRQFUHWH ZLWKRXW SR]]RODQLF DGGLWLRQV
7HVWLQFRQFUHWHVZLWKKLJKSR]]RODQLFFRQWHQWVKRZHGDEQRUPDOLWLHVLQWKHEHKDYLRXU 7HVWLQFRQFUHWHVZLWKKLJKSR]]RODQLFFRQWHQWVKRZHGDEQRUPDOLWLHVLQWKHEHKDYLRXU
RI DFWLYDWHG 7L %DVHG RQ YHU\ ORZ SRODULVDWLRQ UHVLVWDQFHV GHWHUPLQHG E\ µ(,6¶ WR RI DFWLYDWHG 7L %DVHG RQ YHU\ ORZ SRODULVDWLRQ UHVLVWDQFHV GHWHUPLQHG E\ µ(,6¶ WR
JHWKHUZLWKWKHGHYHORSPHQWRIUHODWLYHO\DFWLYHPDJQLWXGHVRIµ(FRUU¶LWKDVEHHQFRQ JHWKHUZLWKWKHGHYHORSPHQWRIUHODWLYHO\DFWLYHPDJQLWXGHVRIµ(FRUU¶LWKDVEHHQFRQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7HVW6HWXSDQG0HDVXULQJ0HWKRGV 7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV 7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV

FOXGHGWKDWFRUURVLRQUHDFWLRQVDIIHFWLQJWKH7LVXEVWUDWHZHUHWDNLQJSODFH >&DVWUR FOXGHGWKDWFRUURVLRQUHDFWLRQVDIIHFWLQJWKH7LVXEVWUDWHZHUHWDNLQJSODFH >&DVWUR


HWDO@ HWDO@
0HDVXUHGPDJQLWXGHVRIµ(FRUU¶RIDFWLYDWHG7LLQOLTXLGVROXWLRQV UHGFLUFOHV LQGLFDWH 0HDVXUHGPDJQLWXGHVRIµ(FRUU¶RIDFWLYDWHG7LLQOLTXLGVROXWLRQV UHGFLUFOHV LQGLFDWH
DS+GHSHQGHQF\RIP9S+VHHWKHUHGOLQHLQ)LJXUH>$@>&DVWURHWDO@ DS+GHSHQGHQF\RIP9S+VHHWKHUHGOLQHLQ)LJXUH>$@>&DVWURHWDO@

   
)LJXUH >$@0HDVXUHGPDJQLWXGHVRIµ(FRUU¶RIDFWLYDWHG7LLQOLTXLGVROXWLRQV )LJXUH >$@0HDVXUHGPDJQLWXGHVRIµ(FRUU¶RIDFWLYDWHG7LLQOLTXLGVROXWLRQV
UHW GRWV DQG UHG OLQH  DQG LQ FRQFUHWH ZLWKRXW SR]]RODQLF DGGLWLRQV UHW GRWV DQG UHG OLQH  DQG LQ FRQFUHWH ZLWKRXW SR]]RODQLF DGGLWLRQV
EOXHER[ DIWHU>&DVWURHWDO@0HDVXUHGPDJQLWXGHVRIµ(FRUU¶ EOXHER[ DIWHU>&DVWURHWDO@0HDVXUHGPDJQLWXGHVRIµ(FRUU¶
VXSHULPSRVHGRQ,U+2µ6(3'¶DQGµ(FRUU¶UDQJHLQWKHDSSOLHGPRU VXSHULPSRVHGRQ,U+2µ6(3'¶DQGµ(FRUU¶UDQJHLQWKHDSSOLHGPRU
WDU \HOORZ OLQHV  DQG H[SRVXUH VROXWLRQV JUHHQ OLQHV  >%@ µ(FRUU¶ WDU \HOORZ OLQHV  DQG H[SRVXUH VROXWLRQV JUHHQ OLQHV  >%@ µ(FRUU¶
UDQJH RI DFWLYDWHG 7L LQ WKH DSSOLHG H[SRVXUH VROXWLRQV JUHHQ OLQHV  UDQJH RI DFWLYDWHG 7L LQ WKH DSSOLHG H[SRVXUH VROXWLRQV JUHHQ OLQHV 
VXSHULPSRVHG RQ )H&O+2 µ0(3'¶ EDVHG RQ 7DEOH  DQG )HLD  VXSHULPSRVHG RQ )H&O+2 µ0(3'¶ EDVHG RQ 7DEOH  DQG )HLD 
íPRO/DQG&OLD PRO/ íPRO/DQG&OLD PRO/
,Q>&DVWURHWDO@LWLVSRVWXODWHGWKDWWKHS+GHSHQGHQF\RIDFWLYDWHG7LUHVHP ,Q>&DVWURHWDO@LWLVSRVWXODWHGWKDWWKHS+GHSHQGHQF\RIDFWLYDWHG7LUHVHP
EOHVWKHS+GHSHQGHQF\RIWKHR[LGDWLRQRILULGLXP ,,, R[LGH ,U2 WRLULGLXP ,9  EOHVWKHS+GHSHQGHQF\RIWKHR[LGDWLRQRILULGLXP ,,, R[LGH ,U2 WRLULGLXP ,9 
R[LGH ,U2 LHWKHDVVRFLDWHGHTXLOLEULXPOLQHZLWKDVORSHRIP9S++RZHYHU R[LGH ,U2 LHWKHDVVRFLDWHGHTXLOLEULXPOLQHZLWKDVORSHRIP9S++RZHYHU
ZKLOHZHGRDJUHHWRWKHFRQFHSWWKDWWKHWKHUPRG\QDPLFVRIDFWLYDWHG7LLVJRYHUQHG ZKLOHZHGRDJUHHWRWKHFRQFHSWWKDWWKHWKHUPRG\QDPLFVRIDFWLYDWHG7LLVJRYHUQHG
E\,UZHVXJJHVWWKDWWKHS+GHSHQGHQF\LVJRYHUQHGE\WKHVORSHRIWKHHTXLOLEULXP E\,UZHVXJJHVWWKDWWKHS+GHSHQGHQF\LVJRYHUQHGE\WKHVORSHRIWKHHTXLOLEULXP
OLQH FI)LJXUH>$@  OLQH FI)LJXUH>$@ 

,U2  + + + + H− → ,U + +  2 (( 
 =  P96+( ) >@
,U2  + + + + H− → ,U + +  2 (( 
 =  P96+( ) >@
(  ,U2  ,U =  −  × S+ (  ,U2  ,U =  −  × S+

$FFRUGLQJ WR >3RXUEDL[ E@ ,U2 LV SUDFWLFDOO\ LPSRVVLEOH WR SUHSDUH DQG LW LV $FFRUGLQJ WR >3RXUEDL[ E@ ,U2 LV SUDFWLFDOO\ LPSRVVLEOH WR SUHSDUH DQG LW LV
WKHUPRG\QDPLFDOO\XQVWDEOHZLWKUHVSHFWWR,UDQG,U2DQGKHQFHWHQGVWRGHFRPSRVH WKHUPRG\QDPLFDOO\XQVWDEOHZLWKUHVSHFWWR,UDQG,U2DQGKHQFHWHQGVWRGHFRPSRVH
WRJLYHDPL[WXUHRIWKHVHVXEVWDQFHV%HVLGHVWKDWWKHPL[HGPHWDOR[LGHFDWDO\VWLV WRJLYHDPL[WXUHRIWKHVHVXEVWDQFHV%HVLGHVWKDWWKHPL[HGPHWDOR[LGHFDWDO\VWLV
JHQHUDOO\GHVFULEHGWRFRQVLVWRI,U2>0$*+LWHFK.DL'D@ JHQHUDOO\GHVFULEHGWRFRQVLVWRI,U2>0$*+LWHFK.DL'D@
)LJXUH>$@DOVRLOOXVWUDWHVWKHS+UDQJHVWKDWFDQEHH[SHFWHGIRUWKHµ((:V¶HP )LJXUH>$@DOVRLOOXVWUDWHVWKHS+UDQJHVWKDWFDQEHH[SHFWHGIRUWKHµ((:V¶HP
EHGGHGLQPRUWDU FILQVWUXPHQWHGPRUWDUVSHFLPHQLQ6HFWLRQ  \HOORZOLQHV  EHGGHGLQPRUWDU FILQVWUXPHQWHGPRUWDUVSHFLPHQLQ6HFWLRQ  \HOORZOLQHV 
 

7KLVLQGLFDWHVWKHLPSRUWDQFHRILQYHVWLJDWLQJWKHHIIHFWRISR]]RODQLFDGGLWLRQVRQWKHWKHUPRG\ 7KLVLQGLFDWHVWKHLPSRUWDQFHRILQYHVWLJDWLQJWKHHIIHFWRISR]]RODQLFDGGLWLRQVRQWKHWKHUPRG\
QDPLFFRQGLWLRQVRIPHWDOVHPEHGGHGLQµ+3&¶ FI6HFWLRQ  QDPLFFRQGLWLRQVRIPHWDOVHPEHGGHGLQµ+3&¶ FI6HFWLRQ 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV 7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV

DQGWKHµ(&DWV¶ FI6HFWLRQ LQWKHH[SRVXUHVROXWLRQV JUHHQOLQHV ZKLFKZHUH DQGWKHµ(&DWV¶ FI6HFWLRQ LQWKHH[SRVXUHVROXWLRQV JUHHQOLQHV ZKLFKZHUH
NHSWDW DS+RI FI 6HFWLRQ $VVKRZQLQ)LJXUH>$@DIWHUDZHHNRI NHSWDW DS+RI FI 6HFWLRQ $VVKRZQLQ)LJXUH>$@DIWHUDZHHNRI
VXEPHUVLRQ RI WKH VSHFLPHQ WKH µ((:V¶ ZHUH PHDVXUHG DW D VWDEOHµ(FRUU¶RIDURXQG VXEPHUVLRQ RI WKH VSHFLPHQ WKH µ((:V¶ ZHUH PHDVXUHG DW D VWDEOH µ(FRUU¶RIDURXQG
 P96+( DQG WKH µ(&DW¶ ZDV PHDVXUHG DW DURXQG  P96+( ZKLFK DUH ERWK LQ  P96+( DQG WKH µ(&DW¶ ZDV PHDVXUHG DW DURXQG  P96+( ZKLFK DUH ERWK LQ
JRRGDJUHHPHQWZLWKWKHS+GHSHQGHQF\GHWHUPLQHGE\>&DVWURHWDO@ JRRGDJUHHPHQWZLWKWKHS+GHSHQGHQF\GHWHUPLQHGE\>&DVWURHWDO@
7RH[HPSOLI\WKHHIIHFWRIWKHHOHYDWHGUHEDUµ(FRUU¶ZKLFKLVJRYHUQHGE\WKHµ(FRUU¶ 7RH[HPSOLI\WKHHIIHFWRIWKHHOHYDWHGUHEDUµ(FRUU¶ZKLFKLVJRYHUQHGE\WKHµ(FRUU¶
RI WKH µ(&DW¶ IRU DQ DFWLYDWHG PDFURFHOO  GXULQJ FRUURVLRQ LQLWLDWLRQ FI 6HFWLRQ RI WKH µ(&DW¶ IRU DQ DFWLYDWHG PDFURFHOO  GXULQJ FRUURVLRQ LQLWLDWLRQ FI 6HFWLRQ
 RQWKHWKHUPRG\QDPLFVRIWKHDQHPEHGGHGVWHHOUHEDULQFKORULGHFRQWDPL  RQWKHWKHUPRG\QDPLFVRIWKHDQHPEHGGHGVWHHOUHEDULQFKORULGHFRQWDPL
QDWHGFRQFUHWHWKHµ(FRUU¶UDQJHRIWKHµ(&DWV¶LQVROXWLRQLVVXSHULPSRVHGRQWKH)H QDWHGFRQFUHWHWKHµ(FRUU¶UDQJHRIWKHµ(&DWV¶LQVROXWLRQLVVXSHULPSRVHGRQWKH)H
&O+2µ0(3'¶LQ)LJXUH>%@7KLVLQGLFDWHVWKHVLPXODWHGZRUVWFDVHFRQGLWLRQV &O+2µ0(3'¶LQ)LJXUH>%@7KLVLQGLFDWHVWKHVLPXODWHGZRUVWFDVHFRQGLWLRQV
SURPRWLQJ ERWK FRUURVLRQ LQLWLDWLRQ DQG SURSDJDWLRQ IRU WKH VSHFLPHQV WHVWHG ZLWK SURPRWLQJ ERWK FRUURVLRQ LQLWLDWLRQ DQG SURSDJDWLRQ IRU WKH VSHFLPHQV WHVWHG ZLWK
FRQQHFWHGµ(&DW¶ FI6HFWLRQ  FRQQHFWHGµ(&DW¶ FI6HFWLRQ 

 
)LJXUH >$@ 0HDVXUHG µ(FRUU¶ GHYHORSPHQW RI HPEHGGHG HOHFWURGH ZLUHV )LJXUH >$@ 0HDVXUHG µ(FRUU¶ GHYHORSPHQW RI HPEHGGHG HOHFWURGH ZLUHV
µ((:V¶RIWKHLQVWUXPHQWHGPRUWDUVSHFLPHQ FI6HFWLRQ LH µ((:V¶RIWKHLQVWUXPHQWHGPRUWDUVSHFLPHQ FI6HFWLRQ LH
VSHFLPHQ&15 FI6HFWLRQ DQGRIDFWLYDWHG7LLQH[SRVXUHVR VSHFLPHQ&15 FI6HFWLRQ DQGRIDFWLYDWHG7LLQH[SRVXUHVR
OXWLRQ EDVHG RQ H[WHUQDO FDWKRGH µ(&DW¶ FI 6HFWLRQ   LQ  OXWLRQ EDVHG RQ H[WHUQDO FDWKRGH µ(&DW¶ FI 6HFWLRQ   LQ 
µZZ¶FKORULGHVROXWLRQZLWKDS+RI>%@0HDVXUHGµ(FRUU¶GHYHO µZZ¶FKORULGHVROXWLRQZLWKDS+RI>%@0HDVXUHGµ(FRUU¶GHYHO
RSPHQWRIDFWLYDWHG7LZLUH VDPHDVµ((:¶PDWHULDO LQ1D2+VROX RSPHQWRIDFWLYDWHG7LZLUH VDPHDVµ((:¶PDWHULDO LQ1D2+VROX
WLRQ ZLWK QDWXUDO R[\JHQ FRQWHQW DQG GHDHUDWLRQ E\ 1 EXEEOLQJ ,W WLRQ ZLWK QDWXUDO R[\JHQ FRQWHQW DQG GHDHUDWLRQ E\ 1 EXEEOLQJ ,W
VKRXOGEHHPSKDVLVHGWKDW>$@LVEDVHGRQDH[SRVXUHGXUDWLRQLQGD\V VKRXOGEHHPSKDVLVHGWKDW>$@LVEDVHGRQDH[SRVXUHGXUDWLRQLQGD\V
ZKHUHDVDV>%@LVEDVHGRQKRXUV ZKHUHDVDV>%@LVEDVHGRQKRXUV
,Q>&DVWURHWDO@LWKDVDOVREHHQVXJJHVWHGWKDWDFWLYDWHG7LVKRZVRQO\PLQRU ,Q>&DVWURHWDO@LWKDVDOVREHHQVXJJHVWHGWKDWDFWLYDWHG7LVKRZVRQO\PLQRU
VHQVLWLYLW\ WR YDULDWLRQV LQ WKH R[\JHQ SDUWLDO SUHVVXUH +RZHYHU LQ VXSSOHPHQWDU\ VHQVLWLYLW\ WR YDULDWLRQV LQ WKH R[\JHQ SDUWLDO SUHVVXUH +RZHYHU LQ VXSSOHPHQWDU\
LQYHVWLJDWLRQVRQWKHVHQVLWLYLW\RIWKHDSSOLHGµ((:¶PDWHULDOWRR[\JHQZHPHDV LQYHVWLJDWLRQVRQWKHVHQVLWLYLW\RIWKHDSSOLHGµ((:¶PDWHULDOWRR[\JHQZHPHDV
XUHG µ(FRUU¶ GLIIHUHQFHV RI DERXW P9 EHWZHHQ ZLUHV LQ S+  1D2+ VROXWLRQ DW XUHG µ(FRUU¶ GLIIHUHQFHV RI DERXW P9 EHWZHHQ ZLUHV LQ S+  1D2+ VROXWLRQ DW
DPELHQWR[\JHQFRQWHQW DQGZLWKGHDHUDWLRQVHH)LJXUH>%@7KLVZDVDOVRFRQ DPELHQWR[\JHQFRQWHQW DQGZLWKGHDHUDWLRQVHH)LJXUH>%@7KLVZDVDOVRFRQ
ILUPHG LQ µ7HVW ,¶ ZKHUH ZH PHDVXUHG µ(FRUU¶ GLIIHUHQFHV LQ WKH VDPH UDQJH IRU ILUPHG LQ µ7HVW ,¶ ZKHUH ZH PHDVXUHG µ(FRUU¶ GLIIHUHQFHV LQ WKH VDPH UDQJH IRU
µ((:V¶HPEHGGHGLQWKHVDPHPRUWDUEXWXQGHUYDU\LQJH[SRVXUHFRQGLWLRQVIRUWKH µ((:V¶HPEHGGHGLQWKHVDPHPRUWDUEXWXQGHUYDU\LQJH[SRVXUHFRQGLWLRQVIRUWKH
VSHFLPHQV>.WHUHWDOE@ VSHFLPHQV>.WHUHWDOE@

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7HVW6HWXSDQG0HDVXULQJ0HWKRGV 7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV 7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV

'HVSLWHLWVR[\JHQDQGS+VHQVLWLYLW\ZHFRQVLGHUDFWLYDWHG7LWREHDVXLWDEOHHP 'HVSLWHLWVR[\JHQDQGS+VHQVLWLYLW\ZHFRQVLGHUDFWLYDWHG7LWREHD VXLWDEOHHP


EHGGDEOHHOHFWURGHLQSDUWLFXODUZLWKUHJDUGWRµ(,6¶ FI6HFWLRQ $FRQVWDQW EHGGDEOHHOHFWURGHLQSDUWLFXODUZLWKUHJDUGWRµ(,6¶ FI6HFWLRQ $FRQVWDQW
SKDVHHOHPHQWEHKDYLRXUDQGDYHU\ODUJHDSSDUHQWLQWHUIDFLDOFDSDFLWDQFHLQWKHRUGHU SKDVHHOHPHQWEHKDYLRXUDQGDYHU\ODUJHDSSDUHQWLQWHUIDFLDOFDSDFLWDQFHLQWKHRUGHU
RI í )FP KDYH EHHQ SRVWXODWHG IRU DFWLYDWHG 7L HPEHGGHG LQ FRQFUHWH >&DVWUR RI í )FP KDYH EHHQ SRVWXODWHG IRU DFWLYDWHG 7L HPEHGGHG LQ FRQFUHWH >&DVWUR
HWDO @ 7KLV SURSHUW\ JUDQWV ORZ LPSHGDQFH DW PRGHUDWH WR KLJK IUHTXHQFLHV HWDO @ 7KLV SURSHUW\ JUDQWV ORZ LPSHGDQFH DW PRGHUDWH WR KLJK IUHTXHQFLHV
ZKLFKLVDGYDQWDJHRXVIRULWVXVHDVDQHOHFWURGH:HYHULILHGWKHDSSOLFDELOLW\RIHP ZKLFKLVDGYDQWDJHRXVIRULWVXVHDVDQHOHFWURGH:HYHULILHGWKHDSSOLFDELOLW\RIHP
EHGGHGDFWLYDWHG7LDVµ((:¶IRUµ(,6¶DQGREWDLQHGDIILUPDWLYHUHVXOWV>.WHUHWDO EHGGHGDFWLYDWHG7LDVµ((:¶IRUµ(,6¶DQGREWDLQHGDIILUPDWLYHUHVXOWV>.WHUHWDO
E@ E@

 7HVW6SHFLPHQV  7HVW6SHFLPHQV


$PRQJRWKHUVSHFLPHQW\SHVWKDWZHUHXVHGLQWKHH[SHULPHQWDOSDUWRIWKLVSURMHFW $PRQJRWKHUVSHFLPHQW\SHVWKDWZHUHXVHGLQWKHH[SHULPHQWDOSDUWRIWKLVSURMHFW
WKHWKUHHSULQFLSDOW\SHVRIVSHFLPHQVIRUHOHFWURFKHPLFDOWHVWLQJRIDYDLODEOHDQGQHZ WKHWKUHHSULQFLSDOW\SHVRIVSHFLPHQVIRUHOHFWURFKHPLFDOWHVWLQJRIDYDLODEOHDQGQHZ
FRXQWHUPHDVXUHVZHUHWKHLQVWUXPHQWHGPRUWDUVSHFLPHQWKHVLPSOHPRUWDUVSHFLPHQ FRXQWHUPHDVXUHVZHUHWKHLQVWUXPHQWHGPRUWDUVSHFLPHQWKHVLPSOHPRUWDUVSHFLPHQ
DQGWKHFHPHQWSDVWHVSHFLPHQ FI6HFWLRQ 7KHGHVLJQDQGPDQXIDFWXUHRIWKHVH DQGWKHFHPHQWSDVWHVSHFLPHQ FI6HFWLRQ 7KHGHVLJQDQGPDQXIDFWXUHRIWKHVH
VSHFLPHQV LV EULHIO\ GHVFULEHG LQ 6HFWLRQV  PRUWDU VSHFLPHQV  DQG  VSHFLPHQV LV EULHIO\ GHVFULEHG LQ 6HFWLRQV  PRUWDU VSHFLPHQV  DQG 
FHPHQW SDVWH VSHFLPHQV  ,Q 6HFWLRQ  YDULDWLRQV LQ WKH OD\RXW RI WKH PRUWDU FHPHQW SDVWH VSHFLPHQV  ,Q 6HFWLRQ  YDULDWLRQV LQ WKH OD\RXW RI WKH PRUWDU
VSHFLPHQ ZKLFK ZHUH XVHG IRU DGGLWLRQDO WHVWLQJ DUH EULHIO\ VXPPDULVHG $V PHQ VSHFLPHQ ZKLFK ZHUH XVHG IRU DGGLWLRQDO WHVWLQJ DUH EULHIO\ VXPPDULVHG $V PHQ
WLRQHGLQ6HFWLRQQRFKORULGHRURWKHUGHSDVVLYDWLQJVSHFLHVZHUHFDVWLQLWLDOO\ WLRQHGLQ6HFWLRQQRFKORULGHRURWKHUGHSDVVLYDWLQJVSHFLHVZHUHFDVWLQLWLDOO\
LQWRWKHVSHFLPHQVDVWKHWKHUPRG\QDPLFFRQGLWLRQVGXULQJERWKSDVVLYLW\DQGDFWLYH LQWRWKHVSHFLPHQVDVWKHWKHUPRG\QDPLFFRQGLWLRQVGXULQJERWKSDVVLYLW\DQGDFWLYH
FRUURVLRQZHUHWREHLQYHVWLJDWHGDQGSDUWLFXODUO\WKHEUHDNGRZQRISDVVLYLW\ZDVRI FRUURVLRQZHUHWREHLQYHVWLJDWHGDQGSDUWLFXODUO\WKHEUHDNGRZQRISDVVLYLW\ZDVRI
LQWHUHVW FI6HFWLRQVDQG  LQWHUHVW FI6HFWLRQVDQG 

 0RUWDU6SHFLPHQV  0RUWDU6SHFLPHQV


7KHGHVLJQDQGPDQXIDFWXUHRIWKHLQVWUXPHQWHGPRUWDUVSHFLPHQVXVHGLQµ7HVW,¶DUH 7KHGHVLJQDQGPDQXIDFWXUHRIWKHLQVWUXPHQWHGPRUWDUVSHFLPHQVXVHGLQµ7HVW,¶DUH
GHVFULEHG LQ GHWDLO LQ >.WHU HWDO @ %HVLGHV LQYHVWLJDWLRQV RQ WKH WKHUPRG\ GHVFULEHG LQ GHWDLO LQ >.WHU HWDO @ %HVLGHV LQYHVWLJDWLRQV RQ WKH WKHUPRG\
QDPLF SURSHUWLHV RI GLIIHUHQW VWHHO TXDOLWLHV DQG FDUERQ VWHHO VXUIDFH WUHDWPHQWV QDPLF SURSHUWLHV RI GLIIHUHQW VWHHO TXDOLWLHV DQG FDUERQ VWHHO VXUIDFH WUHDWPHQWV
µ7HVW,¶DLPHGDWWKHYHULILFDWLRQRIWKHVXLWDELOLW\RIWKHVSHFLPHQIRUµ(FRUU¶PRQLWRU µ7HVW,¶DLPHGDWWKHYHULILFDWLRQRIWKHVXLWDELOLW\RIWKHVSHFLPHQIRUµ(FRUU¶PRQLWRU
LQJDQGLQSDUWLFXODUIRUµ(,6µ FI6HFWLRQ 7KHPRVWLPSRUWDQWUHVXOWVIRUERWK LQJDQGLQSDUWLFXODUIRUµ(,6µ FI6HFWLRQ 7KHPRVWLPSRUWDQWUHVXOWVIRUERWK
WKHVHREMHFWLYHVDUHVXPPDULVHGLQ>.WHUHWDOE@ WKHVHREMHFWLYHVDUHVXPPDULVHGLQ>.WHUHWDOE@
7KHIROORZLQJSURYLGHVEULHIVXPPDU\RQWKHJHRPHWU\DQGFHQWUDOIHDWXUHVRIWKHLQ 7KHIROORZLQJSURYLGHVEULHIVXPPDU\RQWKHJHRPHWU\DQGFHQWUDOIHDWXUHVRIWKHLQ
VWUXPHQWHGPRUWDUVSHFLPHQXVHGIRUµ7HVW,,¶ZKLFKGLIIHUVIURPWKHVSHFLPHQVXVHG VWUXPHQWHGPRUWDUVSHFLPHQXVHGIRUµ7HVW,,¶ZKLFKGLIIHUVIURPWKHVSHFLPHQVXVHG
IRUµ7HVW,¶WRDFHUWDLQH[WHQW IRUµ7HVW,¶WRDFHUWDLQH[WHQW
7KH LQVWUXPHQWHG PRUWDU VSHFLPHQ ZDV F\OLQGULFDO ZLWK D GLDPHWHU RI PP DQG D 7KH LQVWUXPHQWHG PRUWDU VSHFLPHQ ZDV F\OLQGULFDO ZLWK D GLDPHWHU RI PP DQG D
KHLJKWRIPPVHH)LJXUH7KHFHQWULFVPRRWKUHEDU FIVWHHOTXDOLWLHVLQ6HF KHLJKWRIPPVHH)LJXUH7KHFHQWULFVPRRWKUHEDU FIVWHHOTXDOLWLHVLQ6HF
WLRQ KDGDGLDPHWHURIPPDQGDOHQJWKRIPP7KHUHEDUZDVVLWXDWHG WLRQ KDGDGLDPHWHURIPPDQGDOHQJWKRIPP7KHUHEDUZDVVLWXDWHG
LQWKHYHUWLFDOFHQWUHRIWKHVSHFLPHQLHZLWKDGLVWDQFHRIPPIURPWKHWRSDQG LQWKHYHUWLFDOFHQWUHRIWKHVSHFLPHQLHZLWKDGLVWDQFHRIPPIURPWKHWRSDQG
ERWWRPRIWKHVSHFLPHQ$PPGLDPHWHUWKUHDGZDVLQVHUWHGLQWKHWRSVXUIDFHRIWKH ERWWRPRIWKHVSHFLPHQ$PPGLDPHWHUWKUHDGZDVLQVHUWHGLQWKHWRSVXUIDFHRIWKH
UHEDUDQGPPRIWKHWRSFLUFXPIHUHQFHZDVGLSFRDWHGZLWKHSR[\ RQHOD\HURI UHEDUDQGPPRIWKHWRSFLUFXPIHUHQFHZDVGLSFRDWHGZLWKHSR[\ RQHOD\HURI
ORZYLVFRVLW\DQGWZROD\HUVRIWKL[RWURSLFHSR[\ DIWHUDSSOLFDWLRQRIWKHDVVRFLDWHG ORZYLVFRVLW\DQGWZROD\HUVRIWKL[RWURSLFHSR[\ DIWHUDSSOLFDWLRQRIWKHDVVRFLDWHG
VXUIDFH PRGLILFDWLRQWUHDWPHQW FI 6HFWLRQ   $IWHU DVVHPEOLQJ WKH PRXOGV FI VXUIDFH PRGLILFDWLRQWUHDWPHQW FI 6HFWLRQ   $IWHU DVVHPEOLQJ WKH PRXOGV FI

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV 7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV

)LJXUH FDVWLQJ FIPRUWDUFRPSRVLWLRQVLQ6HFWLRQ FXULQJDQGGHPRXOG )LJXUH FDVWLQJ FIPRUWDUFRPSRVLWLRQVLQ6HFWLRQ FXULQJDQGGHPRXOG


LQJDOHDGZLUHZDVFRQQHFWHGWRWKHUHEDUE\DVFUHZFRQQHFWLRQ7KHOHDGZLUHZDV LQJDOHDGZLUHZDVFRQQHFWHGWRWKHUHEDUE\DVFUHZFRQQHFWLRQ7KHOHDGZLUHZDV
FRQQHFWHGWRWKHDVVRFLDWHGFRQGXFWRURIDQLQHFRQGXFWRUFDEOH FRQQHFWHGWRWKHDVVRFLDWHGFRQGXFWRURIDQLQHFRQGXFWRUFDEOH

 
)LJXUH ,GHDOLVHG LQVWUXPHQWHG PRUWDU VSHFLPHQ 'LPHQVLRQV LQ >PP@ >$@ )LJXUH ,GHDOLVHG LQVWUXPHQWHG PRUWDU VSHFLPHQ 'LPHQVLRQV LQ >PP@ >$@
/RQJLWXGLQDOVHFWLRQ µ77¶ WKL[RWURSLFDQG µ/9¶ ORZYLVFRVLW\HS /RQJLWXGLQDOVHFWLRQ µ77¶ WKL[RWURSLFDQG µ/9¶ ORZYLVFRVLW\HS
R[\>%@7RSYLHZ>&@&URVVVHFWLRQZLWKLGHQWLILFDWLRQRIµ(,6¶HOHF R[\>%@7RSYLHZ>&@&URVVVHFWLRQZLWKLGHQWLILFDWLRQRIµ(,6¶HOHF
WURGHVµ:(¶ZRUNLQJHOHFWURGHµ5(¶UHIHUHQFHHOHFWURGHDQGµ&(¶ WURGHVµ:(¶ZRUNLQJHOHFWURGHµ5(¶UHIHUHQFHHOHFWURGHDQGµ&(¶
FRXQWHUHOHFWURGH FRXQWHUHOHFWURGH
7KHWRSDQGERWWRPRIWKHVSHFLPHQZHUHILOOHGZLWKPPDQGPPRIHSR[\UH 7KHWRSDQGERWWRPRIWKHVSHFLPHQZHUHILOOHGZLWKPPDQGPPRIHSR[\UH
VSHFWLYHO\PP RXWHULQQHU GLDPHWHUDFU\OLFJODVVWXEHVHFWLRQVZLWKDOHQJWK VSHFWLYHO\PP RXWHULQQHU GLDPHWHUDFU\OLFJODVVWXEHVHFWLRQVZLWKDOHQJWK
RIPPDWWKHWRSDQGPPDWWKHERWWRPSURYLGHGPRXOGVIRUWKHHSR[\ILOOLQJ RIPPDWWKHWRSDQGPPDWWKHERWWRPSURYLGHGPRXOGVIRUWKHHSR[\ILOOLQJ
7KHERWWRPOD\HURIORZYLVFRVLW\HSR[\ZDVFDVWEHIRUHGHPRXOGLQJDQGUHPRYDORI 7KHERWWRPOD\HURIORZYLVFRVLW\HSR[\ZDVFDVWEHIRUHGHPRXOGLQJDQGUHPRYDORI
WKHVSHFLPHQZLWKDSQHXPDWLFSUHVVKDIWHUFDVWLQJRIWKHHSR[\OD\HU$IWHUGH WKHVSHFLPHQZLWKDSQHXPDWLFSUHVVKDIWHUFDVWLQJRIWKHHSR[\OD\HU$IWHUGH
PRXOGLQJDQGFRQQHFWLRQRIDOOOHDGZLUHVDILUVWOD\HURIWKL[RWURSLFHSR[\ZDVFDVW PRXOGLQJDQGFRQQHFWLRQRIDOOOHDGZLUHVDILUVWOD\HURIWKL[RWURSLFHSR[\ZDVFDVW
DQGDVHFRQGOD\HURIORZYLVFRVLW\HSR[\ZDVFDVWRQWRWKDWOD\HUDIWHUKDUGHQLQJ DQGDVHFRQGOD\HURIORZYLVFRVLW\HSR[\ZDVFDVWRQWRWKDWOD\HUDIWHUKDUGHQLQJ
7KHXSSHUDFU\OLF JODVV VHFWLRQZDVFLUFXPIHUHQWLDOO\QRWFKHGIRUWKHPRXQWLQJRID 7KHXSSHUDFU\OLF JODVV VHFWLRQZDVFLUFXPIHUHQWLDOO\QRWFKHGIRUWKHPRXQWLQJRID
UXEEHU 2ULQJ 7KH HSR[\ SURWHFWHG DOO WKH HOHFWULFDO FRQQHFWLRQV SUHYHQWHG LQJUHVV UXEEHU 2ULQJ 7KH HSR[\ SURWHFWHG DOO WKH HOHFWULFDO FRQQHFWLRQV SUHYHQWHG LQJUHVV
IURPWKHWRSDQGERWWRPVXUIDFHVRIWKHVSHFLPHQDQGLPSHGHGRXWZDUGVGLIIXVLRQDW IURPWKHWRSDQGERWWRPVXUIDFHVRIWKHVSHFLPHQDQGLPSHGHGRXWZDUGVGLIIXVLRQDW
WKH WRS ZKHUH WKH VSHFLPHQ ZDV H[SRVHG WR WKH DPELHQW DLU 0RUHRYHU WKH ERWWRP WKH WRS ZKHUH WKH VSHFLPHQ ZDV H[SRVHG WR WKH DPELHQW DLU 0RUHRYHU WKH ERWWRP
HSR[\ILOOLQJOLPLWHGWKHH[SRVXUHOHQJWKRIWKHUHEDUE\FRYHULQJWKHUHEDURQDOHQJWK HSR[\ILOOLQJOLPLWHGWKHH[SRVXUHOHQJWKRIWKHUHEDUE\FRYHULQJWKHUHEDURQDOHQJWK
RIPP7KHWRWDOH[SRVXUHOHQJWKRIWKHUHEDUZDVPPZKLFKFRUUHVSRQGHGWR RIPP7KHWRWDOH[SRVXUHOHQJWKRIWKHUHEDUZDVPPZKLFKFRUUHVSRQGHGWR
DQH[SRVHGVXUIDFHRIH[DFWO\îPP DQH[SRVHGVXUIDFHRIH[DFWO\îPP
7KH HOHFWURGH ZLUHV FRQVLVWHG RI DFWLYDWHG 7L ZLUH ZLWK D GLDPHWHU RI PP 7ZR 7KH HOHFWURGH ZLUHV FRQVLVWHG RI DFWLYDWHG 7L ZLUH ZLWK D GLDPHWHU RI PP 7ZR
FRQFHQWULFFLUFOHVRIHOHFWURGHZLUHVZHUHDUUDQJHGVRWKDWWKHGLVWDQFHVEHWZHHQWKH FRQFHQWULFFLUFOHVRIHOHFWURGHZLUHVZHUHDUUDQJHGVRWKDWWKHGLVWDQFHVEHWZHHQWKH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7HVW6HWXSDQG0HDVXULQJ0HWKRGV 7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV 7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV

UHEDUVXUIDFHWKHVXUIDFHRIWKHZLUHVDQGWKHVXUIDFHRIWKHVSHFLPHQZHUHRIHTXDO UHEDUVXUIDFHWKHVXUIDFHRIWKHZLUHVDQGWKHVXUIDFHRIWKHVSHFLPHQZHUHRIHTXDO
OHQJWK:LWKDFRYHUGHSWKRIPPWKHVHGLVWDQFHV FRUUHVSRQGHG WR PP IURP OHQJWK:LWKDFRYHUGHSWKRIPPWKHVHGLVWDQFHV FRUUHVSRQGHG WR PP IURP
WKHZLUHFHQWUHWRERWKWKHUHEDUDQGWRWKHVSHFLPHQVXUIDFHDQGWRPPEHWZHHQ WKHZLUHFHQWUHWRERWKWKHUHEDUDQGWRWKHVSHFLPHQVXUIDFHDQGWRPPEHWZHHQ
WKH WZR ZLUH FHQWUHV VHH )LJXUH  &RQQHFWLRQ RI WKH HOHFWURGH ZLUHV WR WKH OHDG WKH WZR ZLUH FHQWUHV VHH )LJXUH  &RQQHFWLRQ RI WKH HOHFWURGH ZLUHV WR WKH OHDG
ZLUHVZDVHVWDEOLVKHGE\FODPSFRQQHFWRUV7KHOHDGZLUHVZHUHFRQQHFWHGWRWKHDV ZLUHVZDVHVWDEOLVKHGE\FODPSFRQQHFWRUV7KHOHDGZLUHVZHUHFRQQHFWHGWRWKHDV
VRFLDWHGFRQGXFWRUVRIWKHQLQHFRQGXFWRUFDEOH VRFLDWHGFRQGXFWRUVRIWKHQLQHFRQGXFWRUFDEOH
'XH WR WKH OLPLWHG VSDFH RI PP EHWZHHQ WKH HOHFWURGH ZLUHV DQG WKH UHEDU DQG 'XH WR WKH OLPLWHG VSDFH RI PP EHWZHHQ WKH HOHFWURGH ZLUHV DQG WKH UHEDU DQG
VSHFLPHQVXUIDFHDPD[LPXPDJJUHJDWHVL]HRIPPLVUHFRPPHQGHGIRUWKHPRUWDU VSHFLPHQVXUIDFHDPD[LPXPDJJUHJDWHVL]HRIPPLVUHFRPPHQGHGIRUWKHPRUWDU
FRPSRVLWLRQ FI6HFWLRQ 7KHPRUWDUZDVH[SRVHGWRWKHVROXWLRQRYHUDOHQJWKRI FRPSRVLWLRQ FI6HFWLRQ 7KHPRUWDUZDVH[SRVHGWRWKHVROXWLRQRYHUDOHQJWKRI
PPZKLFKFRUUHVSRQGHGWRDQH[SRVHGPRUWDUVXUIDFHRIDERXWîPP PPZKLFKFRUUHVSRQGHGWRDQH[SRVHGPRUWDUVXUIDFHRIDERXWîPP
7KHPRVWLPSRUWDQWIHDWXUHVRIWKHGHVLJQDQGPDQXIDFWXUHRIWKHLQVWUXPHQWHGPRUWDU 7KHPRVWLPSRUWDQWIHDWXUHVRIWKHGHVLJQDQGPDQXIDFWXUHRIWKHLQVWUXPHQWHGPRUWDU
VSHFLPHQDUHLOOXVWUDWHGLQ)LJXUHEDVHGRQWKHµ7HVW,¶VSHFLPHQ VSHFLPHQDUHLOOXVWUDWHGLQ)LJXUHEDVHGRQWKHµ7HVW,¶VSHFLPHQ

 
)LJXUH 0DQXIDFWXUH RI WKH LQVWUXPHQWHG PRUWDU VSHFLPHQV EDVHG RQ VSHFL )LJXUH 0DQXIDFWXUH RI WKH LQVWUXPHQWHG PRUWDU VSHFLPHQV EDVHG RQ VSHFL
PHQV XVHG IRU FRQFOXGLQJ WHVWV FRQFHUQLQJ WKHUPRG\QDPLF SURSHUWLHV PHQV XVHG IRU FRQFOXGLQJ WHVWV FRQFHUQLQJ WKHUPRG\QDPLF SURSHUWLHV
RIGLIIHUHQWVWHHOTXDOLWLHVDQGFDUERQVWHHOVXUIDFHWUHDWPHQWV FI6HF RIGLIIHUHQWVWHHOTXDOLWLHVDQGFDUERQVWHHOVXUIDFHWUHDWPHQWV FI6HF
WLRQ >$@&RPSRQHQWVRIPRXOGVZLWKWRSDQGERWWRPOLGIRUSRVL WLRQ >$@&RPSRQHQWVRIPRXOGVZLWKWRSDQGERWWRPOLGIRUSRVL
WLRQLQJRIUHEDUDQGHPEHGGHGHOHFWURGHZLUHVDQGDFU\OLFJODVVVHF WLRQLQJRIUHEDUDQGHPEHGGHGHOHFWURGHZLUHVDQGDFU\OLFJODVVVHF
WLRQV>%@%DWFKRIPRXOGSUHSDUHGIRUFDVWLQJDQGUHEDUVZLWKGLIIHU WLRQV>%@%DWFKRIPRXOGSUHSDUHGIRUFDVWLQJDQGUHEDUVZLWKGLIIHU
HQWVXUIDFHWUHDWPHQWV HQWVXUIDFHWUHDWPHQWV
)RU PRUH LQIRUPDWLRQ RQ WKH PDQXIDFWXUH DQG WHVWLQJ RI WKH LQVWUXPHQWHG PRUWDU )RU PRUH LQIRUPDWLRQ RQ WKH PDQXIDFWXUH DQG WHVWLQJ RI WKH LQVWUXPHQWHG PRUWDU
VSHFLPHQUHIHUHQFHLVPDGHWR>.WHUHWDO.WHUHWDOE@%HVLGHVXVLQJ VSHFLPHQUHIHUHQFHLVPDGHWR>.WHUHWDO.WHUHWDOE@%HVLGHVXVLQJ
VPRRWKUHEDUVLQVWHDGRIULEEHGUHEDUDVZHOODVQRWOLPLWLQJWKHµ((:¶VXUIDFHVE\ VPRRWKUHEDUVLQVWHDGRIULEEHGUHEDUDVZHOODVQRWOLPLWLQJWKHµ((:¶VXUIDFHVE\
VKULQN WXELQJ DQG WKH ERWWRP RI WKH UHEDU E\ GLSFRDWLQJ FI )LJXUH  DQG )LJXUH VKULQN WXELQJ DQG WKH ERWWRP RI WKH UHEDU E\ GLSFRDWLQJ FI )LJXUH  DQG )LJXUH
  VRPH DGGLWLRQDO GHVLJQ FKDQJHV ZHUH LPSOHPHQWHG LQ WKH PDQXIDFWXUH RI WKH   VRPH DGGLWLRQDO GHVLJQ FKDQJHV ZHUH LPSOHPHQWHG LQ WKH PDQXIDFWXUH RI WKH
µ7HVW,,¶VSHFLPHQ µ7HVW,,¶VSHFLPHQ
‡ $VFUHZGHYLFHIRUHDVLHUUHPRYDORIWKHWRSOLGDQGLPSURYHGIL[DWLRQRIWKHUHEDU ‡ $VFUHZGHYLFHIRUHDVLHUUHPRYDORIWKHWRSOLGDQGLPSURYHGIL[DWLRQRIWKHUHEDU
GXULQJYLEUDWLRQDQGDFHQWUDOWKUHDGHGKROHLQWKHERWWRPOLGIRUHDVLHUUHPRYDO GXULQJYLEUDWLRQDQGDFHQWUDOWKUHDGHGKROHLQWKHERWWRPOLGIRUHDVLHUUHPRYDO
‡ $Q LQFUHDVHG RYHUODS EHWZHHQ WKH PRUWDU DQG WKH WRS DFU\OLF JODVV VHFWLRQ DQG ‡ $Q LQFUHDVHG RYHUODS EHWZHHQ WKH PRUWDU DQG WKH WRS DFU\OLF JODVV VHFWLRQ DQG
FDVWLQJRIDILUVWOD\HURIWKL[RWURSLFHSR[\ FI)LJXUH>$@ WROLPLWSHQHWUDWLRQ FDVWLQJRIDILUVWOD\HURIWKL[RWURSLFHSR[\ FI)LJXUH>$@ WROLPLWSHQHWUDWLRQ
LQWRWKHMRLQWEHWZHHQPRUWDUDQGWKHDFU\OLFJODVVVHFWLRQ IRUWKHµ7HVW,¶VSHFL LQWRWKHMRLQWEHWZHHQPRUWDUDQGWKHDFU\OLFJODVVVHFWLRQ IRUWKHµ7HVW,¶VSHFL
PHQVWKLVZDVDFKLHYHGE\VHDOLQJWKHMRLQWIURPWKHRXWVLGH  PHQVWKLVZDVDFKLHYHGE\VHDOLQJWKHMRLQWIURPWKHRXWVLGH 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV 7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV

‡ 7KHFLUFXPIHUHQWLDOQRWFKIRUPRXQWLQJRIWKHUXEEHU2ULQJ FI)LJXUH>$@  ‡ 7KHFLUFXPIHUHQWLDOQRWFKIRUPRXQWLQJRIWKHUXEEHU2ULQJ FI)LJXUH>$@ 


7KHLQVWUXPHQWHGPRUWDUVSHFLPHQVDOORZHGPRQLWRULQJRIYDULRXVGDWDLQDGGLWLRQWR 7KHLQVWUXPHQWHGPRUWDUVSHFLPHQVDOORZHGPRQLWRULQJRIYDULRXVGDWDLQDGGLWLRQWR
WKHWKHUPRG\QDPLFVWDWHRIWKHHPEHGGHGPHWDO$OOSULQFLSDOVSHFLPHQVXVHGLQµ7HVW WKHWKHUPRG\QDPLFVWDWHRIWKHHPEHGGHGPHWDO$OOSULQFLSDOVSHFLPHQVXVHGLQµ7HVW
,¶DQGDOOVSHFLPHQVZLWKLQGLFHVHQGLQJZLWK³$´LQµ7HVW,,¶ZHUHEDVHGRQWKLVGH ,¶DQGDOOVSHFLPHQVZLWKLQGLFHVHQGLQJZLWK³$´LQµ7HVW,,¶ZHUHEDVHGRQWKLVGH
VLJQ FI6HFWLRQDQG6HFWLRQUHVSHFWLYHO\ ,QDGGLWLRQWRWKHLQVWUXPHQWHG VLJQ FI6HFWLRQDQG6HFWLRQUHVSHFWLYHO\ ,QDGGLWLRQWRWKHLQVWUXPHQWHG
PRUWDU VSHFLPHQV ZKRVH SURGXFWLRQ ZDV UHODWLYHO\ ZRUNLQWHQVLYH VLPSOH PRUWDU PRUWDU VSHFLPHQV ZKRVH SURGXFWLRQ ZDV UHODWLYHO\ ZRUNLQWHQVLYH VLPSOH PRUWDU
VSHFLPHQV ZLWK WKH VDPH OD\RXW EXW ZLWKRXW µ((:V¶ ZHUH XVHG DV UHIHUHQFH VSHFL VSHFLPHQV ZLWK WKH VDPH OD\RXW EXW ZLWKRXW µ((:V¶ ZHUH XVHG DV UHIHUHQFH VSHFL
PHQV DLPLQJ RQO\ DW WKH DVVHVVPHQW RI WKH WKHUPRG\QDPLF VWDWH RI WKH UHEDU $OO PHQV DLPLQJ RQO\ DW WKH DVVHVVPHQW RI WKH WKHUPRG\QDPLF VWDWH RI WKH UHEDU $OO
VSHFLPHQVZLWKLQGLFHVHQGLQJZLWK³%´XVHGLQµ7HVW ,,¶ZHUHVLPSOHPRUWDUVSHFL VSHFLPHQVZLWKLQGLFHV HQGLQJZLWK³%´XVHGLQµ7HVW ,,¶ZHUHVLPSOHPRUWDUVSHFL
PHQV FI6HFWLRQ  PHQV FI6HFWLRQ 
%HVLGHVLWVDSSOLFDWLRQLQODERUDWRU\WHVWLQJZHLQYHVWLJDWHGSRVVLELOLWLHVIRUPRGLILHG %HVLGHVLWVDSSOLFDWLRQLQODERUDWRU\WHVWLQJZHLQYHVWLJDWHGSRVVLELOLWLHVIRUPRGLILHG
OD\RXWVRIWKHLQVWUXPHQWHGPRUWDUVSHFLPHQIRU XWLOLVDWLRQDVHPEHGGDEOHFRUURVLRQ OD\RXWVRIWKHLQVWUXPHQWHGPRUWDUVSHFLPHQIRU XWLOLVDWLRQDVHPEHGGDEOHFRUURVLRQ
VHQVRU LQ FRQQHFWLRQ ZLWK WKH HOHFWURFKHPLFDO PHDVXUHPHQW WHFKQLTXHV GHVFULEHG LQ VHQVRU LQ FRQQHFWLRQ ZLWK WKH HOHFWURFKHPLFDO PHDVXUHPHQW WHFKQLTXHV GHVFULEHG LQ
6HFWLRQ7KHVHDVSHFWVZLOOEHHYDOXDWHGLQGHSWKLQIXWXUHLQYHVWLJDWLRQV 6HFWLRQ7KHVHDVSHFWVZLOOEHHYDOXDWHGLQGHSWKLQIXWXUHLQYHVWLJDWLRQV

 &HPHQW3DVWH6SHFLPHQV  &HPHQW3DVWH6SHFLPHQV


,Q DGGLWLRQ WR WKH PRUWDU VSHFLPHQV IRU FRPSUHKHQVLYH PRQLWRULQJ DQG WKH PRUWDU ,Q DGGLWLRQ WR WKH PRUWDU VSHFLPHQV IRU FRPSUHKHQVLYH PRQLWRULQJ DQG WKH PRUWDU
VSHFLPHQVLQWKHVDPHGLDPHWHUZLWKRXWµ((:V¶ FI6HFWLRQ DQRWKHUW\SHRI VSHFLPHQVLQWKHVDPHGLDPHWHUZLWKRXWµ((:V¶ FI6HFWLRQ DQRWKHUW\SHRI
VSHFLPHQZDVURXWLQHO\XVHGIRUYDULRXVH[SHULPHQWVLQFOXGLQJµ7HVW,,¶ FI6HFWLRQ VSHFLPHQZDVURXWLQHO\XVHGIRUYDULRXVH[SHULPHQWVLQFOXGLQJµ7HVW,,¶ FI6HFWLRQ
 LHWKHFHPHQWSDVWHVSHFLPHQ7KHSURGXFWLRQSURFHVVRIWKLVW\SHRIVSHFLPHQV  LHWKHFHPHQWSDVWHVSHFLPHQ7KHSURGXFWLRQSURFHVVRIWKLVW\SHRIVSHFLPHQV
LVLOOXVWUDWHGLQ)LJXUH LVLOOXVWUDWHGLQ)LJXUH

 
)LJXUH >$@ 5HEDUV ZLWK ILUVW OD\HU RI WKL[RWURSLF HSR[\ GLSFRDWLQJ >%@ )LJXUH >$@ 5HEDUV ZLWK ILUVW OD\HU RI WKL[RWURSLF HSR[\ GLSFRDWLQJ >%@
+DUGHQLQJRIVSHFLPHQVDIWHUFHPHQWSDVWHGLSFRDWLQJRQDVSLQQLQJ +DUGHQLQJRIVSHFLPHQVDIWHUFHPHQWSDVWHGLSFRDWLQJRQDVSLQQLQJ
ZKHHO WR DFKLHYH D KRPRJHQRXV WKLFNQHVV RI WKH FHPHQW SDVWH OD\HU ZKHHO WR DFKLHYH D KRPRJHQRXV WKLFNQHVV RI WKH FHPHQW SDVWH OD\HU
>&@&XULQJRIVSHFLPHQVLQVDWXUDWHG&D 2+ VROXWLRQDIWHUKDUGHQ >&@&XULQJRIVSHFLPHQVLQVDWXUDWHG&D 2+ VROXWLRQDIWHUKDUGHQ
LQJRQVSLQQLQJZKHHO LQJRQVSLQQLQJZKHHO
7KH FHPHQW SDVWH VSHFLPHQV ZHUH SURGXFHG IURP WKH VDPH UHEDUV DV WKH PRUWDU 7KH FHPHQW SDVWH VSHFLPHQV ZHUH SURGXFHG IURP WKH VDPH UHEDUV DV WKH PRUWDU
VSHFLPHQV LH PP LQ GLDPHWHUEXW WKH\ ZHUH FXW WR D OHQJWKRIPPZKLFK VSHFLPHQV LH PP LQ GLDPHWHUEXW WKH\ ZHUH FXW WR D OHQJWKRIPPZKLFK
FRUUHVSRQGVWRWKHHQWLUHOHQJWKRIWKHPRUWDUVSHFLPHQ FI)LJXUH>$@ $IWHULQ FRUUHVSRQGVWRWKHHQWLUHOHQJWKRIWKHPRUWDUVSHFLPHQ FI)LJXUH>$@ $IWHULQ

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7HVW6HWXSDQG0HDVXULQJ0HWKRGV 7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV 7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV

VHUWLRQRIWKHDPPGLDPHWHUWKUHDGRQWKHWRSVXUIDFHRIWKHUHDUDQGDSSOLFDWLRQRI VHUWLRQRIWKHDPPGLDPHWHUWKUHDGRQWKHWRSVXUIDFHRIWKHUHDUDQGDSSOLFDWLRQRI
WKH DVVRFLDWHG VXUIDFH PRGLILFDWLRQWUHDWPHQW WKH UHEDU ZDV GLSFRDWHG HSR[\ RQH WKH DVVRFLDWHG VXUIDFH PRGLILFDWLRQWUHDWPHQW WKH UHEDU ZDV GLSFRDWHG HSR[\ RQH
OD\HURIORZYLVFRVLW\DQGWZROD\HUVRIWKL[RWURSLFHSR[\ RQ OHQJWK RI PP DQG OD\HU RI ORZ YLVFRVLW\ DQG WZR OD\HUV RI WKL[RWURSLF HSR[\  RQ OHQJWK RI PP DQG
PPRQWKHWRSDQGERWWRPUHVSHFWLYHO\VHH)LJXUH>$@$IWHUKDUGHQLQJWKH PPRQWKHWRSDQGERWWRPUHVSHFWLYHO\VHH)LJXUH>$@$IWHUKDUGHQLQJWKH
HSR[\ FRDWLQJ ZDV JURXQG RII IURP WKH WRS VXUIDFH DQG D  PP ORQJ WKUHDGHG URG HSR[\ FRDWLQJ ZDV JURXQG RII IURP WKH WRS VXUIDFH DQG D  PP ORQJ WKUHDGHG URG
ZLWKDGLDPHWHURIPPZDVVFUHZHGLQWRWKHWKUHDG$IWHUZDUGVWKHVSHFLPHQZDV ZLWKDGLDPHWHURIPPZDVVFUHZHGLQWRWKHWKUHDG$IWHUZDUGVWKHVSHFLPHQZDV
GLSFRDWHG ZLWK FHPHQW SDVWH FI FHPHQW SDVWH FRPSRVLWLRQ LQ 6HFWLRQ   DQG GLSFRDWHG ZLWK FHPHQW SDVWH FI FHPHQW SDVWH FRPSRVLWLRQ LQ 6HFWLRQ   DQG
PRXQWHGRQDVORZO\URWDWLQJVSLQQLQJZKHHO WRDWWDLQDKRPRJHQRXVFRDWLQJWKLFN PRXQWHGRQDVORZO\URWDWLQJVSLQQLQJZKHHO WRDWWDLQDKRPRJHQRXVFRDWLQJWKLFN
QHVV ZKLOHEHLQJVHDOHGLQDSODVWLFERWWOH WRSUHYHQWGU\LQJRXW VHH)LJXUH>%@ QHVV ZKLOHEHLQJVHDOHGLQDSODVWLFERWWOH WRSUHYHQWGU\LQJRXW VHH)LJXUH>%@
'HSHQGLQJ RQ WKH VXUIDFH PRGLILFDWLRQ RI WKH UHEDU WKH FRDWLQJFXULQJ SURFHVV ZDV 'HSHQGLQJ RQ WKH VXUIDFH PRGLILFDWLRQ RI WKH UHEDU WKH FRDWLQJFXULQJ SURFHVV ZDV
UHSHDWHGWZRWRWKUHHWLPHVZLWKDQDGHTXDWHQXPEHURIGLSVWRDFKLHYHDWKLFNQHVVRI UHSHDWHGWZRWRWKUHHWLPHVZLWKDQDGHTXDWHQXPEHURIGLSVWRDFKLHYHDWKLFNQHVVRI
“PPRQWKHH[SRVHGVXUIDFHZKLFKZDVPHDVXUHGE\PHDQVRIDYHUQLHUFDOOL “PPRQWKHH[SRVHGVXUIDFHZKLFKZDVPHDVXUHGE\PHDQVRIDYHUQLHUFDOOL
SHU JDXJH DIWHU FXULQJ :KHQ WKH GHVLUHG WKLFNQHVV ZDV DWWDLQHG DQG WKH VSHFLPHQV SHU JDXJH DIWHU FXULQJ :KHQ WKH GHVLUHG WKLFNQHVV ZDV DWWDLQHG DQG WKH VSHFLPHQV
ZHUHKDUGHQHGWKH\ZHUHPRLVWFXUHGLQ&D 2+ VROXWLRQVHH)LJXUH>&@ ZHUHKDUGHQHGWKH\ZHUHPRLVWFXUHGLQ&D 2+ VROXWLRQVHH)LJXUH>&@
,QDGGLWLRQWRHQDEOLQJPDVVSURGXFWLRQDQGREWDLQLQJTXLFNLQGLFDWLYHHOHFWURFKHPL ,QDGGLWLRQWRHQDEOLQJPDVVSURGXFWLRQDQGREWDLQLQJTXLFNLQGLFDWLYHHOHFWURFKHPL
FDOUHVXOWVZHWKLQNWKDWWKHFHPHQWSDVWHVSHFLPHQVDOORZHGIRUDGYDQWDJHRXVYLVXDO FDOUHVXOWVZHWKLQNWKDWWKHFHPHQWSDVWHVSHFLPHQVDOORZHGIRUDGYDQWDJHRXVYLVXDO
LQGLFDWLRQVRQWKHHOHFWURFKHPLVWU\EHWZHHQWKH PHWDOVXUIDFHDQG WKH FHPHQWSDVWH LQGLFDWLRQVRQWKHHOHFWURFKHPLVWU\EHWZHHQWKH PHWDOVXUIDFHDQG WKH FHPHQWSDVWH
LHSULQFLSDOO\DOOUHOHYDQWUHDFWLYHFRPSRXQGVLQPRUWDURUFRQFUHWH FI6HFWLRQ  LHSULQFLSDOO\DOOUHOHYDQWUHDFWLYHFRPSRXQGVLQPRUWDURUFRQFUHWH FI6HFWLRQ 
7KLVFRXOGEHHJREVHUYHGLQUHODWLRQWRWKHHIIHFWVRIK\GURJHQHYROXWLRQDW0JZLUH 7KLVFRXOGEHHJREVHUYHGLQUHODWLRQWRWKHHIIHFWVRIK\GURJHQHYROXWLRQDW0JZLUH
FI)LJXUHLQ6HFWLRQ <HWQRWRQO\WKHSK\VLFDODSSHDUDQFHVRIVLGHHI FI)LJXUHLQ6HFWLRQ <HWQRWRQO\WKHSK\VLFDODSSHDUDQFHVRIVLGHHI
IHFWVEXWDOVRFKHPLFDO LQWHUPVRIWKHUDWHRIK\GUDWLRQ FRXOGEHYLVXDOO\DVVHVVHG IHFWVEXWDOVRFKHPLFDO LQWHUPVRIWKHUDWHRIK\GUDWLRQ FRXOGEHYLVXDOO\DVVHVVHG
FILQIOXHQFHRI]LQFRQWKHK\GUDWLRQLQ6HFWLRQVDQG )LQDOO\EHVLGHV FILQIOXHQFHRI]LQFRQWKHK\GUDWLRQLQ6HFWLRQVDQG )LQDOO\EHVLGHV
WKHVH REVHUYDWLRQV RQ WKH FHPHQW SDVWH WKH FKDUDFWHU RI FRUURVLRQ GDPDJH RQ WKH WKHVH REVHUYDWLRQV RQ WKH FHPHQW SDVWH WKH FKDUDFWHU RI FRUURVLRQ GDPDJH RQ WKH
PHWDOVXUIDFHFRXOGEHHDVLO\HVWLPDWHGE\OHDYLQJWKHVSHFLPHQVWRGU\RXWIRUDIHZ PHWDOVXUIDFHFRXOGEHHDVLO\HVWLPDWHGE\OHDYLQJWKHVSHFLPHQVWRGU\RXWIRUDIHZ
KRXUVDIWHUWHVWLQJ FISLWWLQJFRUURVLRQGDPDJHRQVWDLQOHVVVWHHOVSHFLPHQLQ)LJXUH KRXUVDIWHUWHVWLQJ FISLWWLQJFRUURVLRQGDPDJHRQVWDLQOHVVVWHHOVSHFLPHQLQ)LJXUH
 LQ 6HFWLRQ   $IWHU GU\LQJ WKH FHPHQW SDVWH FRXOG EH HDVLO\ UHPRYHG  LQ 6HFWLRQ   $IWHU GU\LQJ WKH FHPHQW SDVWH FRXOG EH HDVLO\ UHPRYHG
ZKLFKYLFHYHUVDPHDQWWKDWGU\LQJRXWQHHGHGWREHSUHYHQWHGEHIRUHDQGGXULQJWHVW ZKLFKYLFHYHUVDPHDQWWKDWGU\LQJRXWQHHGHGWREHSUHYHQWHGEHIRUHDQGGXULQJWHVW
LQJ LQJ
%HVLGHV DSSOLFDWLRQ RI FHPHQW SDVWH VSHFLPHQV IRU YDULRXV SUHSDUDWLYH DQG SUHOLPL %HVLGHV DSSOLFDWLRQ RI FHPHQW SDVWH VSHFLPHQV IRU YDULRXV SUHSDUDWLYH DQG SUHOLPL
QDU\WHVWLQJGXULQJWKHSURMHFWSHULRGWKHVSHFLPHQVZLWKLQGLFHVHQGLQJZLWK³&´DQG QDU\WHVWLQJGXULQJWKHSURMHFWSHULRGWKHVSHFLPHQVZLWKLQGLFHVHQGLQJZLWK³&´DQG
³'´XVHGLQµ7HVW,,¶ZHUHEDVHGRQWKLVGHVLJQ FI6HFWLRQ  ³'´XVHGLQµ7HVW,,¶ZHUHEDVHGRQWKLVGHVLJQ FI6HFWLRQ 

 ([WHUQDO&DWKRGHV  ([WHUQDO&DWKRGHV


7KHH[WHUQDOFDWKRGHVµ(&DWV¶ZHUH PDQXIDFWXUHG IURP DFWLYDWHG7L WXEHV PP 7KHH[WHUQDOFDWKRGHVµ(&DWV¶ZHUH PDQXIDFWXUHG IURP DFWLYDWHG7L WXEHV PP
LQ LQGLDPHWHUVHH)LJXUH>$@IRUDSKRWRJUDSKRIDFRPSOHWHµ(&DW¶DQG LQ LQGLDPHWHUVHH)LJXUH>$@IRUDSKRWRJUDSKRIDFRPSOHWHµ(&DW¶DQG
)LJXUH>%@IRUDQLGHDOLVHGORQJLWXGLQDOVHFWLRQ )LJXUH>%@IRUDQLGHDOLVHGORQJLWXGLQDOVHFWLRQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV 7HVW6SHFLPHQVDQG([WHUQDO&DWKRGHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV

 
)LJXUH ([WHUQDOFDWKRGH>$@3KRWRJUDSK>%@,GHDOLVHGORQJLWXGLQDOVHFWLRQ )LJXUH ([WHUQDOFDWKRGH>$@3KRWRJUDSK>%@,GHDOLVHGORQJLWXGLQDOVHFWLRQ
'LPHQVLRQVLQ>PP@ 'LPHQVLRQVLQ>PP@
7KH XVXDO ILHOG RI DSSOLFDWLRQ IRU WKLV FRPPHUFLDOO\ DYDLODEOH SURGXFW LV DV GLPHQ 7KH XVXDO ILHOG RI DSSOLFDWLRQ IRU WKLV FRPPHUFLDOO\ DYDLODEOH SURGXFW LV DV GLPHQ
VLRQDOO\VWDEOHDQRGHV µ'6$V¶  FI6HFWLRQ 7KHWXEHVZHUHFXWWRDOHQJWKRI VLRQDOO\VWDEOHDQRGHV µ'6$V¶  FI6HFWLRQ 7KHWXEHVZHUHFXWWRDOHQJWKRI
PP XQGHU RLOZDWHU FRROLQJ 6XIILFLHQW FRROLQJ ZDV FUXFLDO EHFDXVH H[FHVVLYH PP XQGHU RLOZDWHU FRROLQJ 6XIILFLHQW FRROLQJ ZDV FUXFLDO EHFDXVH H[FHVVLYH
KHDWDIIHFWVWKHPL[HGPHWDOR[LGHFDWDO\VW>0$*@7KHWXEXODUVW\OHSURYLGHG KHDWDIIHFWVWKHPL[HGPHWDOR[LGHFDWDO\VW>0$*@7KHWXEXODUVW\OHSURYLGHG
DODUJHVXUIDFHDUHDDQG DOORZHGHOHFWULFDOFRQQHFWLRQLQWKHFHQWUHRIWKHµ(&DW¶$ DODUJHVXUIDFHDUHDDQG DOORZHGHOHFWULFDOFRQQHFWLRQLQWKHFHQWUHRIWKHµ(&DW¶$
OHDGZLUHZDVVROGHUHGWRDVHFWLRQRIDPPGLDPHWHUFRSSHUWXEH7KHFRSSHUVHF OHDGZLUHZDVVROGHUHGWRDVHFWLRQRIDPPGLDPHWHUFRSSHUWXEH7KHFRSSHUVHF
WLRQZDVGHIRUPHGLQWRDQRYDOZKLFKZDVVOLJKWO\ZLGHUWKDQWKHLQWHUQDOFLUFXPIHU WLRQZDVGHIRUPHGLQWRDQRYDOZKLFKZDVVOLJKWO\ZLGHUWKDQWKHLQWHUQDOFLUFXPIHU
HQFHRIWKHDFWLYDWHG7LWXEHDQGZHGJHGLQWRWKHWXEH HQFHRIWKHDFWLYDWHG7LWXEHDQGZHGJHGLQWRWKHWXEH
7KHWRSHQGRIWKHWXEHZDVFRYHUHGZLWKDVRIWSODVWLFHQGFDSZKRVHRXWHUGLDPHWHU 7KHWRSHQGRIWKHWXEHZDVFRYHUHGZLWKDVRIWSODVWLFHQGFDSZKRVHRXWHUGLDPHWHU
GHFUHDVHGIURPPPDWWKHWRSWRPPDWWKHERWWRP7KLVOD\RXWDOORZHGLQVHU GHFUHDVHGIURPPPDWWKHWRSWRPPDWWKHERWWRP7KLVOD\RXWDOORZHGLQVHU
WLRQDQGWLJKWPRXQWLQJLQWRDKROHRIPPLQGLDPHWHU7KHOHDGZLUHZDVJXLGHG WLRQDQGWLJKWPRXQWLQJLQWRDKROHRIPPLQGLDPHWHU7KHOHDGZLUHZDVJXLGHG
WKRXJK D FHQWUDO KROH LQ WKH FDS DQG FRQQHFWHG WR WZR FRQGXFWRUV IURP WKH QLQH WKRXJK D FHQWUDO KROH LQ WKH FDS DQG FRQQHFWHG WR WZR FRQGXFWRUV IURP WKH QLQH
FRQGXFWRUFDEOH7KHKROHLQWKHFDSZDVWLJKWHQHGZLWKUDSLGJOXH7KDWZD\LWZDV FRQGXFWRUFDEOH7KHKROHLQWKHFDSZDVWLJKWHQHGZLWKUDSLGJOXH7KDWZD\LWZDV
SRVVLEOHWRILOOWKHHQWLUHWXEHZLWKORZYLVFRVLW\HSR[\IURPWKHERWWRPZKLFKFRP SRVVLEOHWRILOOWKHHQWLUHWXEHZLWKORZYLVFRVLW\HSR[\IURPWKHERWWRPZKLFKFRP
SOHWHO\SUHYHQWHGPRLVWXUHLQWUXVLRQDQGKHQFHSURWHFWHGWKHHOHFWULFDOFRQQHFWLRQ SOHWHO\SUHYHQWHGPRLVWXUHLQWUXVLRQDQGKHQFHSURWHFWHGWKHHOHFWULFDOFRQQHFWLRQ
7KHHQGFDSFRYHUHGWKHWXEHIRUDOHQJWKRIPP7KXVWKHWRWDOH[SRVXUHOHQJWK 7KHHQGFDSFRYHUHGWKHWXEHIRUDOHQJWKRIPP7KXVWKHWRWDOH[SRVXUHOHQJWK
RI WKH µ(&DW¶ ZDV PP ZKLFK FRUUHVSRQGHG WR DQ H[SRVHG VXUIDFH RI H[DFWO\ RI WKH µ(&DW¶ ZDV PP ZKLFK FRUUHVSRQGHG WR DQ H[SRVHG VXUIDFH RI H[DFWO\
îPP7KLVPHDQWWKDWWKHUDWLRRIH[SRVXUHDUHDEHWZHHQUHEDUDQGµ(&DW¶ZDV îPP7KLVPHDQWWKDWWKHUDWLRRIH[SRVXUHDUHDEHWZHHQUHEDUDQGµ(&DW¶ZDV
 FI6HFWLRQVDQG ,IGHVLUHGDSODVWLFULQJZLWKWKHVDPHRXWHUGL  FI6HFWLRQVDQG ,IGHVLUHGDSODVWLFULQJZLWKWKHVDPHRXWHUGL
PHQVLRQDVWKHWRSFDSFRXOGEHLQVWDOOHGDWDQDUELWUDU\SRVLWLRQRQWKHWXEHWRDGMXVW PHQVLRQDVWKHWRSFDSFRXOGEHLQVWDOOHGDWDQDUELWUDU\SRVLWLRQRQWKHWXEHWRDGMXVW
WKHH[SRVXUHVXUIDFH,QWKLVZD\WKHDQRGHWRFDWKRGHUDWLRFRXOGEHLQFUHDVHG WKHH[SRVXUHVXUIDFH,QWKLVZD\WKHDQRGHWRFDWKRGHUDWLRFRXOGEHLQFUHDVHG

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7HVW6HWXSDQG0HDVXULQJ0HWKRGV ([SRVXUH6HWXS 7HVW6HWXSDQG0HDVXULQJ0HWKRGV ([SRVXUH6HWXS

 ([SRVXUH6HWXS  ([SRVXUH6HWXS


7ZRH[SRVXUHFRQWDLQHUVRQHODUJHDQGRQHVPDOOZHUHGHVLJQHGIRUSRVLWLRQLQJDQG 7ZRH[SRVXUHFRQWDLQHUVRQHODUJHDQGRQHVPDOOZHUHGHVLJQHGIRUSRVLWLRQLQJDQG
VXEPHUVLRQ RI WKH WHVW VSHFLPHQV DQG µ(&DWV¶ )RU µ7HVW ,,¶ WKH ODUJH FRQWDLQHU ZDV VXEPHUVLRQ RI WKH WHVW VSHFLPHQV DQG µ(&DWV¶ )RU µ7HVW ,,¶ WKH ODUJH FRQWDLQHU ZDV
XVHGIRUH[SRVXUHWRFKORULGHVROXWLRQZKLOHWKHVPDOOFRQWDLQHUZDVILOOHGZLWKSRWD XVHGIRUH[SRVXUHWRFKORULGHVROXWLRQZKLOHWKHVPDOOFRQWDLQHUZDVILOOHGZLWKSRWD
EOHZDWHUDQGIXQFWLRQHGDVUHIHUHQFH FI6HFWLRQ 7KHUHTXLUHGPHDVXUHPHQW EOHZDWHUDQGIXQFWLRQHGDVUHIHUHQFH FI6HFWLRQ 7KHUHTXLUHGPHDVXUHPHQW
WHFKQLTXHVPHQWLRQHGLQ6HFWLRQFRXOGEHFDUULHGRXWLQWKHVDPHZD\RQVSHFL WHFKQLTXHVPHQWLRQHGLQ6HFWLRQFRXOGEHFDUULHGRXWLQWKHVDPHZD\RQVSHFL
PHQVLQERWKFRQWDLQHUV(DFKH[SRVXUHFRQWDLQHUZDVPRXQWHGRQWRSRIDWZROHYHO PHQVLQERWKFRQWDLQHUV(DFKH[SRVXUHFRQWDLQHUZDVPRXQWHGRQWRSRIDWZROHYHO
FDUWZLWKDUHVHUYRLUFRQWDLQHURQWKHERWWRPVKHOIVHH)LJXUH>$@ FDUWZLWKDUHVHUYRLUFRQWDLQHURQWKHERWWRPVKHOIVHH)LJXUH>$@

 
)LJXUH >$@([SRVXUHVHWXSRQWZROHYHOFDUWVZLWKWKHDFU\OLFJODVVH[SRVXUH )LJXUH >$@([SRVXUHVHWXSRQWZROHYHOFDUWVZLWKWKHDFU\OLFJODVVH[SRVXUH
FRQWDLQHUV RQ WKH WRS VKHOI WKH UHVHUYRLU FRQWDLQHUV RQ WKH ERWWRP FRQWDLQHUV RQ WKH WRS VKHOI WKH UHVHUYRLU FRQWDLQHUV RQ WKH ERWWRP
VKHOI DQG WKH DLU SXPS LQ IURQW >%@ ,GHDOLVHG WRS YLHZ RI WKH IXOO\ VKHOI DQG WKH DLU SXPS LQ IURQW >%@ ,GHDOLVHG WRS YLHZ RI WKH IXOO\
HTXLSSHGVPDOOH[SRVXUHFRQWDLQHU'LPHQVLRQVLQ>PP@ HTXLSSHGVPDOOH[SRVXUHFRQWDLQHU'LPHQVLRQVLQ>PP@
7KHH[SRVXUHFRQWDLQHUVZHUHPDQXIDFWXUHGIURPPPWKLFNDFU\OLFJODVV7KHLQVLGH 7KHH[SRVXUHFRQWDLQHUVZHUHPDQXIDFWXUHGIURPPPWKLFNDFU\OLFJODVV7KHLQVLGH
GLPHQVLRQV RI WKH VPDOO FRQWDLQHU ZHUH PPîPP VHH )LJXUH  >%@ 7KH GLPHQVLRQV RI WKH VPDOO FRQWDLQHU ZHUH PPîPP VHH )LJXUH  >%@ 7KH
ODUJHFRQWDLQHUPHDVXUHGPPîPPRQWKHLQVLGH FI)LJXUHLQ6HFWLRQ ODUJHFRQWDLQHUPHDVXUHGPPîPPRQWKHLQVLGH FI)LJXUHLQ6HFWLRQ
 7KHPD[LPXPVROXWLRQOHYHOIURPWKHWRSRIWKHERWWRPSODWHWRXQGHUQHDWKWKH  7KHPD[LPXPVROXWLRQOHYHOIURPWKHWRSRIWKHERWWRPSODWHWRXQGHUQHDWKWKH
OLGZDVPPIRUERWKFRQWDLQHUV7KXVWKHFRQWDLQHUVKDGDWRWDOFDSDFLW\RIDS OLGZDVPPIRUERWKFRQWDLQHUV7KXVWKHFRQWDLQHUVKDGDWRWDOFDSDFLW\RIDS
SUR[LPDWHO\ / DQG / ZLWKRXW WHVW VSHFLPHQV LQVHUWHG QHJOLJLEO\ UHGXFHG SUR[LPDWHO\ / DQG / ZLWKRXW WHVW VSHFLPHQV LQVHUWHG QHJOLJLEO\ UHGXFHG
E\WKHDHUDWLRQIUDPHLQVLGHWKHFRQWDLQHU %RWKFRQWDLQHUVZHUHVXSSOLHGZLWKVROX E\WKHDHUDWLRQIUDPHLQVLGHWKHFRQWDLQHU %RWKFRQWDLQHUVZHUHVXSSOLHGZLWKVROX
WLRQIURPDUHVHUYRLUFRQWDLQHU7KHLQVLGHGLPHQVLRQVRIWKHUHVHUYRLUFRQWDLQHUVZHUH WLRQIURPDUHVHUYRLUFRQWDLQHU7KHLQVLGHGLPHQVLRQVRIWKHUHVHUYRLUFRQWDLQHUVZHUH
PPîPPDQGWKHPD[LPXPVROXWLRQOHYHOLVPP7KLVFRUUHVSRQGHGWR PPîPPDQGWKHPD[LPXPVROXWLRQOHYHOLVPP7KLVFRUUHVSRQGHGWR
DWRWDOFDSDFLW\RI/$FFRUGLQJO\/DQG/RIVROXWLRQZHUHDYDLO DWRWDOFDSDFLW\RI/$FFRUGLQJO\/DQG/RIVROXWLRQZHUHDYDLO
DEOH IRU FLUFXODWLRQ LQ WKH VPDOO DQG ODUJH H[SRVXUH FRQWDLQHU UHVSHFWLYHO\ ZKHQ DW DEOH IRU FLUFXODWLRQ LQ WKH VPDOO DQG ODUJH H[SRVXUH FRQWDLQHU UHVSHFWLYHO\ ZKHQ DW
WKHPD[LPXPVROXWLRQOHYHODQGQRWHTXLSSHGZLWKVSHFLPHQVDQGFDWKRGHV WKHPD[LPXPVROXWLRQOHYHODQGQRWHTXLSSHGZLWKVSHFLPHQVDQGFDWKRGHV
7KHVROXWLRQZDVSXPSHGIURPWKHUHVHUYRLUFRQWDLQHUVLQWRWKHH[SRVXUHFRQWDLQHUV 7KHVROXWLRQZDVSXPSHGIURPWKHUHVHUYRLUFRQWDLQHUVLQWRWKHH[SRVXUHFRQWDLQHUV
E\ D FHQWULIXJDO PDJQHWLF SXPS WKURXJK D PP LQOHW LQ WKH FHQWUH RI WKH ERWWRP E\ D FHQWULIXJDO PDJQHWLF SXPS WKURXJK D PP LQOHW LQ WKH FHQWUH RI WKH ERWWRP

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


([SRVXUH6HWXS 7HVW6HWXSDQG0HDVXULQJ0HWKRGV ([SRVXUH6HWXS 7HVW6HWXSDQG0HDVXULQJ0HWKRGV

SODWHRIWKHH[SRVXUHFRQWDLQHU7KHVROXWLRQIORZHGEDFNLQWRWKHUHVHUYRLUWKURXJK SODWHRIWKHH[SRVXUHFRQWDLQHU7KHVROXWLRQIORZHGEDFNLQWRWKHUHVHUYRLUWKURXJK
DQRYHUIORZFRPSULVLQJIRXUSLSHVZLWKDGLDPHWHURIPPZKLFKSURWUXGHGIURP DQRYHUIORZFRPSULVLQJIRXUSLSHVZLWKDGLDPHWHURIPPZKLFKSURWUXGHGIURP
WKHERWWRPSODWHDWHDFKFRUQHURIWKHH[SRVXUHFRQWDLQHU7KHOLGZDVUHFHVVHGDERYH WKHERWWRPSODWHDWHDFKFRUQHURIWKHH[SRVXUHFRQWDLQHU7KHOLGZDVUHFHVVHGDERYH
HDFKRYHUIORZSLSHWRHQDEOHVWHDG\IORZ7KHUHFHVVHVZHUHFUHDWHGE\JOXLQJPP HDFKRYHUIORZSLSHWRHQDEOHVWHDG\IORZ7KHUHFHVVHVZHUHFUHDWHGE\JOXLQJPP
ORQJ SODVWLF WXEHV ZLWK VFUHZ FDSV LQWR PP GLDPHWHU KROHV LQ WKH OLG 2XWIORZ ORQJ SODVWLF WXEHV ZLWK VFUHZ FDSV LQWR PP GLDPHWHU KROHV LQ WKH OLG 2XWIORZ
WKURXJK DOO IRXU SLSHV DQG HTXLYDOHQW H[SRVXUH FRQGLWLRQV IRU DOO VSHFLPHQV ZHUH WKURXJK DOO IRXU SLSHV DQG HTXLYDOHQW H[SRVXUH FRQGLWLRQV IRU DOO VSHFLPHQV ZHUH
DFKLHYHGE\ OHYHOOLQJ WKH FDUWV KRUL]RQWDOO\ 7KH VROXWLRQ OHYHOFRXOGEHDGMXVWHGE\ DFKLHYHGE\ OHYHOOLQJ WKH FDUWV KRUL]RQWDOO\ 7KH VROXWLRQ OHYHOFRXOGEHDGMXVWHGE\
UHGXFLQJWKHKHLJKWRIWKHRXWIORZSLSHV7KHKHLJKWFRXOGEHDOWHUHGIURPXQGHUQHDWK UHGXFLQJWKHKHLJKWRIWKHRXWIORZSLSHV7KHKHLJKWFRXOGEHDOWHUHGIURPXQGHUQHDWK
WKHOLGWRPPEHORZWKHOLGE\VFUHZLQJWKHRXWIORZSLSHVLQWRWKHLUWKUHDGHGILW WKHOLGWRPPEHORZWKHOLGE\VFUHZLQJWKHRXWIORZSLSHVLQWRWKHLUWKUHDGHGILW
WLQJV$GMXVWPHQWRIWKHRXWIORZSLSHVZDVFDUULHGRXWXVLQJDKDUGUXEEHUURGZLWK WLQJV$GMXVWPHQWRIWKHRXWIORZSLSHVZDVFDUULHGRXWXVLQJDKDUGUXEEHUURGZLWK
DFFHVV WKURXJK WKH VFUHZ FDSV RI WKH UHFHVV WXEHV 6KRUWHU RXWIORZ SLSHV FRXOG EH DFFHVV WKURXJK WKH VFUHZ FDSV RI WKH UHFHVV WXEHV 6KRUWHU RXWIORZ SLSHV FRXOG EH
PRXQWHGWRIXUWKHUUHGXFHWKHVROXWLRQOHYHO)RUµ7HVW,,¶WKHVROXWLRQOHYHOZDVDG PRXQWHGWRIXUWKHUUHGXFHWKHVROXWLRQOHYHO)RUµ7HVW,,¶WKHVROXWLRQOHYHOZDVDG
MXVWHGVRWKDWRIWKHPRUWDUFHPHQWSDVWHVXUIDFH LQUHODWLRQWRWKHVXUIDFHRIWKH MXVWHGVRWKDWRIWKHPRUWDUFHPHQWSDVWHVXUIDFH LQUHODWLRQWRWKHVXUIDFHRIWKH
HPEHGGHGUHEDU ZHUHFRYHUHGE\H[SRVXUHVROXWLRQ FIVXUIDFHRIPRUWDUVSHFLPHQ HPEHGGHGUHEDU ZHUHFRYHUHGE\H[SRVXUHVROXWLRQ FIVXUIDFHRIPRUWDUVSHFLPHQ
LQ)LJXUH>$@LQ6HFWLRQ  LQ)LJXUH>$@LQ6HFWLRQ 
,IWKHVROXWLRQKDGWREHWRWDOO\UHPRYHGIURPWKHH[SRVXUHFRQWDLQHUHJIRUDGU\LQJ ,IWKHVROXWLRQKDGWREHWRWDOO\UHPRYHGIURPWKHH[SRVXUHFRQWDLQHUHJIRUDGU\LQJ
SHULRGRUVROXWLRQUHQHZDOWKHFHQWULIXJDOSXPSZDVWXUQHGRIIDQGDWZRZD\YDOYH SHULRGRUVROXWLRQUHQHZDOWKHFHQWULIXJDOSXPSZDVWXUQHGRIIDQGDWZRZD\YDOYH
ZDVRSHQHGVRWKDWWKHVROXWLRQIORZHGWKURXJKWKHLQIORZRXWRIWKHH[SRVXUHFRQ ZDVRSHQHGVRWKDWWKHVROXWLRQIORZHGWKURXJKWKHLQIORZRXWRIWKHH[SRVXUHFRQ
WDLQHU LQWR WKH UHVHUYRLU 7KH UHVHUYRLU FRQWDLQHU FRXOG EH HPSWLHG E\ PHDQV RI DQ WDLQHU LQWR WKH UHVHUYRLU 7KH UHVHUYRLU FRQWDLQHU FRXOG EH HPSWLHG E\ PHDQV RI DQ
RWKHU WZRZD\ YDOYH ZKLFK ZDV DOVR XVHG IRU ILOOLQJ $Q RYHUIORZ EHQHDWK WKH WRS RWKHU WZRZD\ YDOYH ZKLFK ZDV DOVR XVHG IRU ILOOLQJ $Q RYHUIORZ EHQHDWK WKH WRS
HGJHSUHYHQWHGWKHUHVHUYRLUFRQWDLQHUIURPIORRGLQJZKHQWKH GHSOHWLRQYDOYH ZDV HGJHSUHYHQWHG WKH UHVHUYRLU FRQWDLQHU IURP IORRGLQJ ZKHQ WKH GHSOHWLRQYDOYH ZDV
FORVHGDQGWKHFHQWULIXJDOSXPSZDVGHDFWLYDWHGHJLQWKHHYHQWRIDSRZHUIDLOXUH FORVHGDQGWKHFHQWULIXJDOSXPSZDVGHDFWLYDWHGHJLQWKHHYHQWRIDSRZHUIDLOXUH
7KHSRVLWLRQVRIWKHVSHFLPHQVZHUHGHWHUPLQHGE\PPGLDPHWHUKROHVLQWKHOLGV 7KHSRVLWLRQVRIWKHVSHFLPHQVZHUHGHWHUPLQHGE\PPGLDPHWHUKROHVLQWKHOLGV
RIWKHH[SRVXUHFRQWDLQHUVZKLOHPPGLDPHWHUKROHVGHWHUPLQHGWKHORFDWLRQVRI RIWKHH[SRVXUHFRQWDLQHUVZKLOHPPGLDPHWHUKROHVGHWHUPLQHGWKHORFDWLRQVRI
WKHµ(&DWV¶7KHFHPHQWSDVWHVSHFLPHQVZHUHIL[HGLQSRVLWLRQE\PHDQVRIDGDSWHUV WKHµ(&DWV¶7KHFHPHQWSDVWHVSHFLPHQVZHUHIL[HGLQSRVLWLRQE\PHDQVRIDGDSWHUV
XSSHURXWHUGLDPHWHUPPORZHURXWHUGLDPHWHUPPXSSHUGLDPHWHURIFHQWUDO XSSHURXWHUGLDPHWHUPPORZHURXWHUGLDPHWHUPPXSSHUGLDPHWHURIFHQWUDO
KROHPPDQGORZHUGLDPHWHURIFHQWUDOKROHPP ZKHUHWKHVSHFLPHQVFRXOG KROHPPDQGORZHUGLDPHWHURIFHQWUDOKROHPP ZKHUHWKHVSHFLPHQVFRXOG
EHPRXQWHG IURPEHORZ ZLWKDQ2ULQJ IURPDERYH VRWKDWWKHH[SRVXUHVXUIDFHRI EHPRXQWHG IURPEHORZ ZLWKDQ2ULQJ IURPDERYH VRWKDWWKHH[SRVXUHVXUIDFHRI
WKHUHEDUZDVRQWKHVDPHOHYHODVIRUWKHPRUWDUVSHFLPHQV7KHFHQWUHWRFHQWUHGLV WKHUHEDUZDVRQWKHVDPHOHYHODVIRUWKHPRUWDUVSHFLPHQV7KHFHQWUHWRFHQWUHGLV
WDQFH EHWZHHQ WZR DGMDFHQW VSHFLPHQV ZDV PP ZKLFK FRUUHVSRQGHG WR D IUHH WDQFH EHWZHHQ WZR DGMDFHQW VSHFLPHQV ZDV PP ZKLFK FRUUHVSRQGHG WR D IUHH
VSDFHRIPPIRUWZRPRUWDUVSHFLPHQVQH[WWRHDFKRWKHU7KHFHQWUHWRFHQWUHGLV VSDFHRIPPIRUWZRPRUWDUVSHFLPHQVQH[WWRHDFKRWKHU7KHFHQWUHWRFHQWUHGLV
WDQFH EHWZHHQ D VSHFLPHQ DQG LWV DVVRFLDWHG FDWKRGH ZHUH DOVR PP 7KLV PHDQV WDQFH EHWZHHQ D VSHFLPHQ DQG LWV DVVRFLDWHG FDWKRGH ZHUH DOVR PP 7KLV PHDQV
WKDW WKH VXUIDFHWRVXUIDFH GLVWDQFH EHWZHHQ D UHEDU DQG LWV DVVRFLDWHG µ(&DW¶ ZDV WKDW WKH VXUIDFHWRVXUIDFH GLVWDQFH EHWZHHQ D UHEDU DQG LWV DVVRFLDWHG µ(&DW¶ ZDV
PPIRUERWKW\SHVRIVSHFLPHQV PPIRUERWKW\SHVRIVSHFLPHQV
7KH VPDOO FRQWDLQHU KDG D FDSDFLW\ RI  VSHFLPHQV DOWRJHWKHU  VSHFLPHQV ZHUH 7KH VPDOO FRQWDLQHU KDG D FDSDFLW\ RI  VSHFLPHQV DOWRJHWKHU  VSHFLPHQV ZHUH
ORFDWHG RQ WKH RXWHU FLUFOH  DQG $'  DQG VL[ VSHFLPHQV RQWKHLQQHUFLUFOH , ORFDWHG RQ WKH RXWHU FLUFOH  DQG $'  DQG VL[ VSHFLPHQV RQ WKH LQQHUFLUFOH ,
9, VSHFLPHQVFRXOGEHFRQQHFWHGWRDQµ(&DW¶  ZKHUHDVVSHFLPHQV $ 9, VSHFLPHQVFRXOGEHFRQQHFWHGWRDQµ(&DW¶  ZKHUHDVVSHFLPHQV $
' ,9,  ZHUH QRW DVVRFLDWHG ZLWK DQ µ(&DW¶ 7KH ODUJH FRQWDLQHU SURYLGHG  SRVL ' ,9,  ZHUH QRW DVVRFLDWHG ZLWK DQ µ(&DW¶ 7KH ODUJH FRQWDLQHU SURYLGHG  SRVL
WLRQVIRUVSHFLPHQVDOWRJHWKHU RQWKHRXWHUDQGRQWKHLQQHUFLUFOHFIFI)LJ WLRQVIRUVSHFLPHQVDOWRJHWKHU RQWKHRXWHUDQGRQWKHLQQHUFLUFOHFIFI)LJ
XUHLQ6HFWLRQ VSHFLPHQVFRXOGEHFRQQHFWHGWRDQDHUDWHGµ(&DW¶ZKLOH XUHLQ6HFWLRQ VSHFLPHQVFRXOGEHFRQQHFWHGWRDQDHUDWHGµ(&DW¶ZKLOH
VL[VSHFLPHQVZHUHDVVRFLDWHGZLWKDQµ(&DW¶7KHUHZHUHDQRWKHUSRVLWLRQVZLWK VL[VSHFLPHQVZHUHDVVRFLDWHGZLWKDQµ(&DW¶7KHUHZHUHDQRWKHUSRVLWLRQVZLWK

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7HVW6HWXSDQG0HDVXULQJ0HWKRGV ([SRVXUH6HWXS 7HVW6HWXSDQG0HDVXULQJ0HWKRGV ([SRVXUH6HWXS

RSWLRQDOFRQQHFWLRQVWRXQDHUDWHGµ(&DWV¶7KHXQDHUDWHGµ(&DWV¶ZHUHORFDWHGZLWKLQ RSWLRQDOFRQQHFWLRQVWRXQDHUDWHGµ(&DWV¶7KHXQDHUDWHGµ(&DWV¶ZHUHORFDWHGZLWKLQ
WKHLQQHUFLUFOHRIVSHFLPHQVZLWKWKHVDPHFHQWUHWRFHQWUHGLVWDQFHRIPPWRWKH WKHLQQHUFLUFOHRIVSHFLPHQVZLWKWKHVDPHFHQWUHWRFHQWUHGLVWDQFHRIPPWRWKH
DVVRFLDWHGVSHFLPHQ DVVRFLDWHGVSHFLPHQ
,IWKHRYHUIORZVZHUHDGMXVWHGIRUPD[LPXPILOOLQJWKHVSHFLPHQVDQGµ(&DWV¶ZHUH ,IWKHRYHUIORZVZHUHDGMXVWHGIRUPD[LPXPILOOLQJWKHVSHFLPHQVDQGµ(&DWV¶ZHUH
VXEPHUJHGRYHUDOHQJWKRIPPDQGPPUHVSHFWLYHO\7KLVFRUUHVSRQGHGWR VXEPHUJHGRYHUDOHQJWKRIPPDQGPPUHVSHFWLYHO\7KLVFRUUHVSRQGHGWR
DVROXWLRQYROXPHRI/IRUWKHPRUWDUVSHFLPHQDQG/IRUWKHµ(&DW¶7KLV DVROXWLRQYROXPHRI/IRUWKHPRUWDUVSHFLPHQDQG/IRUWKHµ(&DW¶7KLV
PHDQVWKDWWKHH[SRVXUHVROXWLRQYROXPHZDVUHGXFHGE\/IRUWKHVPDOOFRQWDLQHU PHDQVWKDWWKHH[SRVXUHVROXWLRQYROXPHZDVUHGXFHGE\/IRUWKHVPDOOFRQWDLQHU
DQG/IRUWKHODUJHFRQWDLQHULIWKH\ZHUHIXOO\HTXLSSHGZLWKPRUWDUVSHFLPHQV DQG/IRUWKHODUJHFRQWDLQHULIWKH\ZHUHIXOO\HTXLSSHGZLWKPRUWDUVSHFLPHQV
DQGFDWKRGHV LQFOXGLQJRSWLRQDOµ(&DWV¶IRUWKHODUJHFRQWDLQHU 7KXVWKHDPRXQWRI DQGFDWKRGHV LQFOXGLQJRSWLRQDOµ(&DWV¶IRUWKHODUJHFRQWDLQHU 7KXVWKHDPRXQWRI
H[SRVXUH VROXWLRQ DYDLODEOH IRU FLUFXODWLRQ LQ WKH WZR FRQWDLQHUV ZDV UHGXFHG WR H[SRVXUH VROXWLRQ DYDLODEOH IRU FLUFXODWLRQ LQ WKH WZR FRQWDLQHUV ZDV UHGXFHG WR
/DQG/UHVSHFWLYHO\+HQFHWKHWRWDODUHDRIVXEPHUJHGPRUWDUVXUIDFH /DQG/UHVSHFWLYHO\+HQFHWKHWRWDODUHDRIVXEPHUJHGPRUWDUVXUIDFH
ZDVPIRUWKHVPDOOFRQWDLQHU DQGP IRU WKH ODUJH FRQWDLQHU 7KDW OHG WR ZDVPIRUWKHVPDOOFRQWDLQHU DQGP IRU WKH ODUJH FRQWDLQHU 7KDW OHG WR
UDWLRVRIVROXWLRQYROXPHWRPRUWDUVXUIDFHDUHDRI/PIRUWKHVPDOOFRQWDLQHU UDWLRVRIVROXWLRQYROXPHWRPRUWDUVXUIDFHDUHDRI/PIRUWKHVPDOOFRQWDLQHU
DQG/PIRUWKHODUJHFRQWDLQHU,IGHVLUHGWKHUDWLRVFRXOGEHDGMXVWHGE\ORZHU DQG/PIRUWKHODUJHFRQWDLQHU,IGHVLUHGWKHUDWLRVFRXOGEHDGMXVWHGE\ORZHU
LQJWKHVROXWLRQOHYHOLQWKHUHVHUYRLUIRUWKHVPDOOFRQWDLQHURUE\SODFLQJH[WUDPRU LQJWKHVROXWLRQOHYHOLQWKHUHVHUYRLUIRUWKHVPDOOFRQWDLQHURUE\SODFLQJH[WUDPRU
WDUFXEHVRUF\OLQGHUVLQWKHXQXVHGORFDWLRQVRIWKHVPDOOH[SRVXUHRUUHVHUYRLUFRQ WDUFXEHVRUF\OLQGHUVLQWKHXQXVHGORFDWLRQVRIWKHVPDOOH[SRVXUHRUUHVHUYRLUFRQ
WDLQHU,QWKLVZD\HIIHFWVRQWKHPRUWDUVXUIDFHVXFKDVOHDFKLQJRUVXUIDFHFRQFHQ WDLQHU,QWKLVZD\HIIHFWVRQWKHPRUWDUVXUIDFHVXFKDVOHDFKLQJRUVXUIDFHFRQFHQ
WUDWLRQFRXOGEHHYHQHGRXW)RUDOOLQYHVWLJDWLRQVRQWKHKLJKFDSDFLW\H[SRVXUHVHWXS WUDWLRQFRXOGEHHYHQHGRXW)RUDOOLQYHVWLJDWLRQVRQWKHKLJKFDSDFLW\H[SRVXUHVHWXS
DVROXWLRQYROXPHWRPRUWDUVXUIDFHDUHDUDWLRRI/PZDVXVHG DVROXWLRQYROXPHWRPRUWDUVXUIDFHDUHDUDWLRRI/PZDVXVHG
7KHµ(&DWV¶ZHUHDHUDWHGYLDDQDHUDWLRQIUDPHSODFHGDWWKHERWWRPRIWKHH[SRVXUH 7KHµ(&DWV¶ZHUHDHUDWHGYLDDQDHUDWLRQIUDPHSODFHGDWWKHERWWRPRIWKHH[SRVXUH
FRQWDLQHUV $HUDWLRQ FRQGLWLRQV ZHUH HTXDO IRU DOO VSHFLPHQV EHFDXVH WKH DHUDWLRQ FRQWDLQHUV $HUDWLRQ FRQGLWLRQV ZHUH HTXDO IRU DOO VSHFLPHQV EHFDXVH WKH DHUDWLRQ
IUDPHZDVPRXQWHGDWWKHVDPHGLVWDQFHEHWZHHQWKHLQQHUDQGRXWHUFLUFOHRIVSHFL IUDPHZDVPRXQWHGDWWKHVDPHGLVWDQFHEHWZHHQWKHLQQHUDQGRXWHUFLUFOHRIVSHFL
PHQVLQERWKFRQWDLQHUV7KHDHUDWLRQIUDPHZDVPDGHRIDFU\OLFJODVVDQGHTXLSSHG PHQVLQERWKFRQWDLQHUV7KHDHUDWLRQIUDPHZDVPDGHRIDFU\OLFJODVVDQGHTXLSSHG
ZLWK FXVWRPPDGH SODVWLF QR]]OHV ZLWK D PP GLDPHWHU KROH 6LOLFRQ KRVHV ZHUH ZLWK FXVWRPPDGH SODVWLF QR]]OHV ZLWK D PP GLDPHWHU KROH 6LOLFRQ KRVHV ZHUH
IL[HGRQWKHQR]]OHVDQGFRQQHFWHGWRWKHDLUVXSSO\SLSHIUDPHZKLFKZDVPRXQWHG IL[HGRQWKHQR]]OHVDQGFRQQHFWHGWRWKHDLUVXSSO\SLSHIUDPHZKLFKZDVPRXQWHG
RQWRSRIWKHOLGWKURXJKWLJKWO\ILWWLQJPPGLDPHWHUKROHVLQWKHOLG7KHDLUVXS RQWRSRIWKHOLGWKURXJKWLJKWO\ILWWLQJPPGLDPHWHUKROHVLQWKHOLG7KHDLUVXS
SO\ SLSH IUDPH FRQVLVWHG RI PP GLDPHWHU SODVWLF SLSHV ZLWK UHGXFLQJ YDOYHV IRU SO\ SLSH IUDPH FRQVLVWHG RI PP GLDPHWHU SODVWLF SLSHV ZLWK UHGXFLQJ YDOYHV IRU
HDFKVLOLFRQKRVHDQGDFRQQHFWLRQWRDQDLUSXPS$GMXVWPHQWRIWKH LQGLYLGXDO UH HDFKVLOLFRQKRVHDQGDFRQQHFWLRQWRDQDLUSXPS$GMXVWPHQWRIWKH LQGLYLGXDO UH
GXFLQJ YDOYHV HQDEOHG HTXDO DHUDWLRQ IRU DOO µ(&DWV¶ RU YDU\LQJ FRQGLWLRQV DV UH GXFLQJ YDOYHV HQDEOHG HTXDO DHUDWLRQ IRU DOO µ(&DWV¶ RU YDU\LQJ FRQGLWLRQV DV UH
TXLUHG 7KH DHUDWLRQ LQ WKH H[SRVXUH FRQWDLQHU LQWURGXFHG VXIILFLHQW WXUEXOHQFH WR TXLUHG 7KH DHUDWLRQ LQ WKH H[SRVXUH FRQWDLQHU LQWURGXFHG VXIILFLHQW WXUEXOHQFH WR
DYRLG SUHFLSLWDWLRQ HYHQ IRU KLJK FKORULGH FRQFHQWUDWLRQV FI H[SRVXUH VROXWLRQV LQ DYRLG SUHFLSLWDWLRQ HYHQ IRU KLJK FKORULGH FRQFHQWUDWLRQV FI H[SRVXUH VROXWLRQV LQ
6HFWLRQ 3UHFLSLWDWLRQLQWKHUHVHUYRLUFRQWDLQHUVZDVSUHYHQWHGE\VXEPHUJHG 6HFWLRQ 3UHFLSLWDWLRQLQWKHUHVHUYRLUFRQWDLQHUVZDVSUHYHQWHGE\VXEPHUJHG
FLUFXODWLRQSXPSV FLUFXODWLRQSXPSV
(YDSRUDWLRQRIZDWHUDQGFU\VWDOOLVDWLRQRIFKORULGHZHUHPLQLPLVHGEHFDXVHWKHVR (YDSRUDWLRQRIZDWHUDQGFU\VWDOOLVDWLRQRIFKORULGHZHUHPLQLPLVHGEHFDXVHWKHVR
OXWLRQZDVFLUFXODWHGWKURXJKDFORVHGV\VWHPDQGWKHFRQWDLQHUVZHUHILWWHGZLWKOLGV OXWLRQZDVFLUFXODWHGWKURXJKDFORVHGV\VWHPDQGWKHFRQWDLQHUVZHUHILWWHGZLWKOLGV
7KHOLGVRIWKHH[SRVXUHFRQWDLQHUVZHUHVFUHZWLJKWHQHGWRWKHVXSSRUWIUDPHDORQJ 7KHOLGVRIWKHH[SRVXUHFRQWDLQHUVZHUHVFUHZWLJKWHQHGWRWKHVXSSRUWIUDPHDORQJ
WKHLQVLGHZDOORIWKHFRQWDLQHUWKHµ(&DWV¶WKHDLUVXSSO\KRVHVDQGWKHDGDSWHUVIRU WKHLQVLGHZDOORIWKHFRQWDLQHUWKHµ(&DWV¶WKHDLUVXSSO\KRVHVDQGWKHDGDSWHUVIRU
WKH FHPHQW SDVWH VSHFLPHQV ZHUH FORVHO\ ILWWHG DQG WKH UXEEHU 2ULQJV DURXQG WKH WKH FHPHQW SDVWH VSHFLPHQV ZHUH FORVHO\ ILWWHG DQG WKH UXEEHU 2ULQJV DURXQG WKH
PRUWDUDQGFHPHQWVSHFLPHQVWLJKWHQHGWKHDVVRFLDWHGKROHV7KHRXWZDUGGLIIXVLRQRI PRUWDUDQGFHPHQWVSHFLPHQVWLJKWHQHGWKHDVVRFLDWHGKROHV7KHRXWZDUGGLIIXVLRQRI
H[SRVXUH VROXWLRQ RU FKORULGH LRQV WKURXJK WKH PRUWDU ZDV SUHYHQWHG E\ WKH HSR[\ H[SRVXUH VROXWLRQ RU FKORULGH LRQV WKURXJK WKH PRUWDU ZDV SUHYHQWHG E\ WKH HSR[\
OD\HURQWKHWRSRIWKHPRUWDUVSHFLPHQV FI6HFWLRQ 0RUHRYHUWKHUHVHUYRLU OD\HURQWKHWRSRIWKHPRUWDUVSHFLPHQV FI6HFWLRQ 0RUHRYHUWKHUHVHUYRLU

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


0RQLWRULQJ6\VWHP 7HVW6HWXSDQG0HDVXULQJ0HWKRGV 0RQLWRULQJ6\VWHP 7HVW6HWXSDQG0HDVXULQJ0HWKRGV

FRQWDLQHUZDVFRYHUHGDQGWKHRXWIORZSLSHVSURWUXGHGLQWRWKHVROXWLRQGRZQWRMXVW FRQWDLQHUZDVFRYHUHGDQGWKHRXWIORZSLSHVSURWUXGHGLQWRWKHVROXWLRQGRZQWRMXVW
DERYHWKHERWWRPRIWKHUHVHUYRLUFRQWDLQHU DERYHWKHERWWRPRIWKHUHVHUYRLUFRQWDLQHU
7ZRPPGLDPHWHUSODVWLFILWWLQJVZHUHPRXQWHGIRUWKHLQVHUWLRQRIWZRSHUPDQHQW 7ZRPPGLDPHWHUSODVWLFILWWLQJVZHUHPRXQWHGIRUWKHLQVHUWLRQRIWZRSHUPDQHQW
µ6&(V¶RQWKHFHQWUHOLQHRIWKHFRQWDLQHU7KHKHLJKWRIWKHILWWLQJVZDVGHVLJQHGVR µ6&(V¶RQWKHFHQWUHOLQHRIWKHFRQWDLQHU7KHKHLJKWRIWKHILWWLQJVZDVGHVLJQHGVR
WKDWWKHWLSVRIWKHµ6&(V¶ZHUHLQWKHYHUWLFDOFHQWUHRIWKH H[SRVHGVXUIDFHDUHDRI WKDWWKHWLSVRIWKHµ6&(V¶ZHUHLQWKHYHUWLFDOFHQWUHRIWKH H[SRVHGVXUIDFHDUHDRI
WKHUHEDUVLQDOOVSHFLPHQV$VHULHVRIPPKROHVDQGIRXUPPKROHVZHUHDOVR WKHUHEDUVLQDOOVSHFLPHQV$VHULHVRIPPKROHVDQGIRXUPPKROHVZHUHDOVR
SURYLGHG7KHPPKROHVZHUHVLWXDWHGQH[WWRHDFKVSHFLPHQDQGDWJHRPHWULFDOO\ SURYLGHG7KHPPKROHVZHUHVLWXDWHGQH[WWRHDFKVSHFLPHQDQGDWJHRPHWULFDOO\
GHILQHG SRVLWLRQV 1H[W WR HDFK FRQWDLQHU ZDOO ZDV RQH PP DQG RQH PP KROH GHILQHG SRVLWLRQV 1H[W WR HDFK FRQWDLQHU ZDOO ZDV RQH PP DQG RQH PP KROH
7KH PP KROHV VXLWHG PRVW VWDQGDUG HOHFWURGHV ZKLOH WKH PP KROHV ZHUH SUR 7KH PP KROHV VXLWHG PRVW VWDQGDUG HOHFWURGHV ZKLOH WKH PP KROHV ZHUH SUR
YLGHGIRUHOHFWURGHV ZLWKDODUJHUGLDPHWHUHJVRPHW\SHVRI LRQ VHOHFWLYH DQGS+ YLGHGIRUHOHFWURGHV ZLWKDODUJHUGLDPHWHUHJVRPHW\SHVRI LRQ VHOHFWLYH DQGS+
HOHFWURGHV $ SODVWLF DGDSWHU WXEH ZDV XVHG WR EULQJ WKH HOHFWURGH WLSV WR GHILQHG HOHFWURGHV $ SODVWLF DGDSWHU WXEH ZDV XVHG WR EULQJ WKH HOHFWURGH WLSV WR GHILQHG
KHLJKWV ZKHQ LQVHUWHG :KHQ QRW LQ XVH UXEEHU VWRSSHUV ZHUH LQVHUWHG LQ WKH H[WUD KHLJKWV ZKHQ LQVHUWHG :KHQ QRW LQ XVH UXEEHU VWRSSHUV ZHUH LQVHUWHG LQ WKH H[WUD
KROHVWRNHHSWKHV\VWHPFORVHG KROHVWRNHHSWKHV\VWHPFORVHG

 0RQLWRULQJ6\VWHP  0RQLWRULQJ6\VWHP


$OWRJHWKHU  VSHFLPHQV FRXOG EH H[SRVHG VLPXOWDQHRXVO\ ZKHQ ERWK FRQWDLQHUV $OWRJHWKHU  VSHFLPHQV FRXOG EH H[SRVHG VLPXOWDQHRXVO\ ZKHQ ERWK FRQWDLQHUV
ZHUH IXOO\HTXLSSHG FI7DEOHDQG)LJXUHLQ6HFWLRQDQG)LJXUHLQ ZHUH IXOO\HTXLSSHG FI7DEOHDQG)LJXUHLQ6HFWLRQDQG)LJXUHLQ
6HFWLRQ $VPHQWLRQHGLQ6HFWLRQFKDQQHOVZHUHPRQLWRUHGIRUWKHLQ 6HFWLRQ $VPHQWLRQHGLQ6HFWLRQFKDQQHOVZHUHPRQLWRUHGIRUWKHLQ
VWUXPHQWHGPRUWDUVSHFLPHQZLWKµ(&DW¶7KHQXPEHURIFKDQQHOVZDVUHGXFHGWR VWUXPHQWHGPRUWDUVSHFLPHQZLWKµ(&DW¶7KHQXPEHURIFKDQQHOVZDVUHGXFHGWR
IRUDQLQVWUXPHQWHGPRUWDUVSHFLPHQZLWKRXWµ(&DW¶WRVL[IRUVLPSOHPRUWDURUFH IRUDQLQVWUXPHQWHGPRUWDUVSHFLPHQZLWKRXWµ(&DW¶WRVL[IRUVLPSOHPRUWDURUFH
PHQW SDVWH VSHFLPHQV ZLWK µ(&DW¶ DQG WR WZR IRU PRQLWRULQJ RI µ(FRUU¶ RQO\ 7KH PHQW SDVWH VSHFLPHQV ZLWK µ(&DW¶ DQG WR WZR IRU PRQLWRULQJ RI µ(FRUU¶ RQO\ 7KH
FKDQQHO XVH DQG DVVLJQPHQW LVGHVFULEHGLQ6HFWLRQLQPRUHGHWDLO8VLQJFRQ FKDQQHO XVH DQG DVVLJQPHQW LVGHVFULEHGLQ6HFWLRQLQPRUHGHWDLO8VLQJFRQ
YHQWLRQDOGDWDORJJLQJWRPRQLWRUWKHUHTXLUHGQXPEHURIFKDQQHOVHJIRUWKHHQWLUH YHQWLRQDOGDWDORJJLQJWRPRQLWRUWKHUHTXLUHGQXPEHURIFKDQQHOVHJIRUWKHHQWLUH
WHVWEDWFKRIµ7HVW,,¶ FI6HFWLRQ ZRXOGKDYHEHHQLPSUDFWLFDODVZHOODVFRVW WHVWEDWFKRIµ7HVW,,¶ FI6HFWLRQ ZRXOGKDYHEHHQLPSUDFWLFDODVZHOODVFRVW
LQWHQVLYH 0RUHRYHU FRQYHQWLRQDO GDWDORJJLQJ ZRXOG KDYH UHTXLUHG LQGLYLGXDO FXU LQWHQVLYH 0RUHRYHU FRQYHQWLRQDO GDWDORJJLQJ ZRXOG KDYH UHTXLUHG LQGLYLGXDO FXU
UHQWWRYROWDJH FRQYHUWHUV IRU HDFK VSHFLPHQ ZKHUH PDFURFHOO FXUUHQW µLPDF¶ ZDV UHQWWRYROWDJH FRQYHUWHUV IRU HDFK VSHFLPHQ ZKHUH PDFURFHOO FXUUHQW µLPDF¶ ZDV
PRQLWRUHG PRQLWRUHG
:HGHYHORSHGDV\VWHPIRUPRQLWRULQJRIPXOWLSOHVSHFLPHQVEDVHGRQ³FOXVWHUPHDV :HGHYHORSHGDV\VWHPIRUPRQLWRULQJRIPXOWLSOHVSHFLPHQVEDVHGRQ³FOXVWHUPHDV
XUHPHQWV´7KLVV\VWHPUHGXFHVWKHQXPEHURIUHTXLUHGGDWDORJJHUFKDQQHOVWRDQG XUHPHQWV´7KLVV\VWHPUHGXFHVWKHQXPEHURIUHTXLUHGGDWDORJJHUFKDQQHOVWRDQG
WKHQXPEHURIFXUUHQWWRYROWDJHFRQYHUWHUVWRWZR7KHSULQFLSOHRIFOXVWHUPHDVXUH WKHQXPEHURIFXUUHQWWRYROWDJHFRQYHUWHUVWRWZR7KHSULQFLSOHRIFOXVWHUPHDVXUH
PHQWVLVEULHIO\GHVFULEHGLQ6HFWLRQDQGWKHNH\IHDWXUHVRIWKHV\VWHPWKHDG PHQWVLVEULHIO\GHVFULEHGLQ6HFWLRQDQGWKHNH\IHDWXUHVRIWKHV\VWHPWKHDG
DSWDWLRQVWRPHHWWKHVSHFLILFUHTXLUHPHQWVLQWKHSUHVHQWDSSOLFDWLRQDQGWKHVXSSOH DSWDWLRQVWRPHHWWKHVSHFLILFUHTXLUHPHQWVLQWKHSUHVHQWDSSOLFDWLRQDQGWKHVXSSOH
PHQWDU\HTXLSPHQWXVHGDUHGHVFULEHGLQ6HFWLRQV VZLWFKFDUGV  GLVWUL PHQWDU\HTXLSPHQWXVHGDUHGHVFULEHGLQ6HFWLRQV VZLWFKFDUGV  GLVWUL
EXWLRQWHUPLQDOERDUGDQGGDWDORJJHU DQG FRQWUROURXWLQH  EXWLRQWHUPLQDOERDUGDQGGDWDORJJHU DQG FRQWUROURXWLQH 

 &OXVWHU0HDVXUHPHQWV  &OXVWHU0HDVXUHPHQWV


&RQFOXVLYHHYDOXDWLRQRIH[SHULPHQWDOWHVWLQJLVJHQHUDOO\EDVHGRQVWDWLVWLFDODQDO\VLV &RQFOXVLYHHYDOXDWLRQRIH[SHULPHQWDOWHVWLQJLVJHQHUDOO\EDVHGRQVWDWLVWLFDODQDO\VLV
RIGDWDREWDLQHGIURPVHYHUDOVSHFLPHQV'HSHQGLQJRQWKHQXPEHURIVLJQDOVPRQL RIGDWDREWDLQHGIURPVHYHUDOVSHFLPHQV'HSHQGLQJRQWKHQXPEHURIVLJQDOVPRQL
WRUHG IRU WKH LQGLYLGXDO VSHFLPHQ WKH EDWFK VL]H LV RIWHQ OLPLWHG E\ WKH QXPEHU RI WRUHG IRU WKH LQGLYLGXDO VSHFLPHQ WKH EDWFK VL]H LV RIWHQ OLPLWHG E\ WKH QXPEHU RI
DYDLODEOHGDWDORJJHUFKDQQHOV7KLVJHQHUDOO\OHDGVWRDFRPSURPLVHLQUHGXFLQJHLWKHU DYDLODEOHGDWDORJJHUFKDQQHOV7KLVJHQHUDOO\OHDGVWRDFRPSURPLVHLQUHGXFLQJHLWKHU

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7HVW6HWXSDQG0HDVXULQJ0HWKRGV 0RQLWRULQJ6\VWHP 7HVW6HWXSDQG0HDVXULQJ0HWKRGV 0RQLWRULQJ6\VWHP

WKHQXPEHURIVLJQDOVPRQLWRUHGSHUVSHFLPHQRUWKHDPRXQWRIVSHFLPHQV WKHEDWFK WKHQXPEHURIVLJQDOVPRQLWRUHGSHUVSHFLPHQRUWKHDPRXQWRIVSHFLPHQV WKHEDWFK


VL]H  ,I WKH QXPEHUV RI VLJQDOV LV QRW WR EH UHGXFHG VPDOOHU WHVW EDWFKHV DUH WR EH VL]H  ,I WKH QXPEHUV RI VLJQDOV LV QRW WR EH UHGXFHG VPDOOHU WHVW EDWFKHV DUH WR EH
WHVWHG RQH DIWHU HDFK RWKHU +RZHYHU VHTXHQWLDO WHVWLQJ RI VPDOOHU EDWFKHV LV RIWHQ WHVWHG RQH DIWHU HDFK RWKHU +RZHYHU VHTXHQWLDO WHVWLQJ RI VPDOOHU EDWFKHV LV RIWHQ
LPSUDFWLFDORULPSRVVLEOHIRUWLPHFRQVWUDLQWV7KLVKROGVLQSDUWLFXODUIRUORQJWHUP LPSUDFWLFDORULPSRVVLEOHIRUWLPHFRQVWUDLQWV7KLVKROGVLQSDUWLFXODUIRUORQJWHUP
WHVWLQJDVHJWHVWVFRQFHUQLQJUHLQIRUFHPHQWFRUURVLRQ 0HDVXUHPHQWVRUPRQLWRU WHVWLQJDVHJWHVWVFRQFHUQLQJUHLQIRUFHPHQWFRUURVLRQ 0HDVXUHPHQWVRUPRQLWRU
LQJ FRQWLQXRXVPHDVXUHPHQWV LQUHODWLRQWRUHLQIRUFHPHQWFRUURVLRQWHVWLQJLVJHQHU LQJ FRQWLQXRXVPHDVXUHPHQWV LQUHODWLRQWRUHLQIRUFHPHQWFRUURVLRQWHVWLQJLVJHQHU
DOO\EDVHG RQ UHFRUGLQJ WKH VDPHPHDVXUHGSDUDPHWHUVHJµ(FRUU¶DQG µLFRUULPDF¶IRU DOO\EDVHG RQ UHFRUGLQJ WKH VDPH PHDVXUHGSDUDPHWHUV HJ µ(FRUU¶ DQG µLFRUULPDF¶IRU
DOOWHVWVSHFLPHQVZKLFKDOORZVFRPSDULVRQRIWKHVHSDUDPHWHUVLQUHODWLRQWRWKHWHVW DOOWHVWVSHFLPHQVZKLFKDOORZVFRPSDULVRQRIWKHVHSDUDPHWHUVLQUHODWLRQWRWKHWHVW
SDUDPHWHUV HJ WKH HIIHFW RI GLIIHUHQW FRXQWHUPHDVXUHV RU H[SRVXUH FRQGLWLRQV ,Q SDUDPHWHUV HJ WKH HIIHFW RI GLIIHUHQW FRXQWHUPHDVXUHV RU H[SRVXUH FRQGLWLRQV ,Q
VXFK DSSOLFDWLRQV DV ZHOO DV IRU PRVW RWKHU ORQJWHUP PRQLWRULQJ D WRWDOO\ V\QFKUR VXFK DSSOLFDWLRQV DV ZHOO DV IRU PRVW RWKHU ORQJWHUP PRQLWRULQJ D WRWDOO\ V\QFKUR
QRXVVLJQDOORJJLQJIRUDOOPHDVXUHGSDUDPHWHUV LVQRWLPSRUWDQW7KXVZHFRQVLGHU QRXVVLJQDOORJJLQJIRUDOOPHDVXUHGSDUDPHWHUV LVQRWLPSRUWDQW7KXVZHFRQVLGHU
WKDWWKHOLPLWDWLRQVGXHWRWKHQXPEHURIDYDLODEOHGDWDORJJHUFKDQQHOVFRXOGEHFRQ WKDWWKHOLPLWDWLRQVGXHWRWKHQXPEHURIDYDLODEOHGDWDORJJHUFKDQQHOVFRXOGEHFRQ
YHQLHQWO\DGGUHVVHGE\GLYHUWLQJDODUJHUWHVWEDWFKLQWRFOXVWHUVZLWKWKHVDPHPHDV YHQLHQWO\DGGUHVVHGE\GLYHUWLQJDODUJHUWHVWEDWFKLQWRFOXVWHUVZLWKWKHVDPHPHDV
XUHGSDUDPHWHUV7KLVPHDQVWKDWDOOVLJQDOVRIRQHVSHFLPHQRURIDJURXSRIVSHFL XUHGSDUDPHWHUV7KLVPHDQVWKDWDOOVLJQDOVRIRQHVSHFLPHQRURIDJURXSRIVSHFL
PHQVDUHORJJHGEHIRUHWKHVDPHVLJQDOVDUHORJJHGIRUWKHQH[WVSHFLPHQRUJURXSRI PHQVDUHORJJHGEHIRUHWKHVDPHVLJQDOVDUHORJJHGIRUWKHQH[WVSHFLPHQRUJURXSRI
VSHFLPHQVXQWLOWKHIXOOEDWFKLVVFDQQHGDQGWKHFOXVWHUPHDVXUHPHQWFDQVWDUWIURP VSHFLPHQVXQWLOWKHIXOOEDWFKLVVFDQQHGDQGWKHFOXVWHUPHDVXUHPHQWFDQVWDUWIURP
WKHEHJLQQLQJDWDJLYHQWLPH7KHEHQHILWVRIPRQLWRULQJEDVHGRQFOXVWHUPHDVXUH WKHEHJLQQLQJDWDJLYHQWLPH7KHEHQHILWVRIPRQLWRULQJEDVHGRQFOXVWHUPHDVXUH
PHQWVLQWHVWLQJDJDLQVWPRUHUHIHUHQFHVLJQDOVDUHH[HPSOLILHGLQ)LJXUHDQG)LJ PHQWVLQWHVWLQJDJDLQVWPRUHUHIHUHQFHVLJQDOVDUHH[HPSOLILHGLQ)LJXUHDQG)LJ
XUH)LJXUHLOOXVWUDWHVPRQLWRULQJRIWKUHH³KLJK´VLJQDOV $WR&UHGGRWV RI XUH)LJXUHLOOXVWUDWHVPRQLWRULQJRIWKUHH³KLJK´VLJQDOV $WR&UHGGRWV RI
VL[VSHFLPHQV WR YHUVXVWKUHH³ORZ´UHIHUHQFHVLJQDO 5HWR5H LQEDVHGRQ VL[VSHFLPHQV WR YHUVXVWKUHH³ORZ´UHIHUHQFHVLJQDO 5HWR5H LQEDVHGRQ
FRQYHQWLRQDOGDWDORJJLQJ FRQYHQWLRQDOGDWDORJJLQJ

 
)LJXUH 0RQLWRULQJRIWKUHHVLJQDOV $WR& IURPHDFKRIVL[VSHFLPHQV WR )LJXUH 0RQLWRULQJRIWKUHHVLJQDOV $WR& IURPHDFKRIVL[VSHFLPHQV WR
 DJDLQVWWKUHHUHIHUHQFHVLJQDOV 5HWR5H E\FRQYHQWLRQDOGDWD  DJDLQVWWKUHHUHIHUHQFHVLJQDOV 5HWR5H E\FRQYHQWLRQDOGDWD
ORJJLQJ ORJJLQJ
7KH EODFN GRWV UHSUHVHQW WKH QLQH ³KLJK´ GDWDORJJHU FKDQQHOV WR SHUIRUP WKH PHDV 7KH EODFN GRWV UHSUHVHQW WKH QLQH ³KLJK´ GDWDORJJHU FKDQQHOV WR SHUIRUP WKH PHDV
XUHPHQWV IRU HDFK VSHFLPHQ $FFRUGLQJO\  FKDQQHOV DUH UHTXLUHG WR PRQLWRU WKH XUHPHQWV IRU HDFK VSHFLPHQ $FFRUGLQJO\  FKDQQHOV DUH UHTXLUHG WR PRQLWRU WKH
PDWUL[IRUWKHHQWLUHEDWFKRIVL[VSHFLPHQVE\FRQYHQWLRQDOGDWDORJJLQJ PDWUL[IRUWKHHQWLUHEDWFKRIVL[VSHFLPHQVE\FRQYHQWLRQDOGDWDORJJLQJ

 

$VZHOODVIRUPDQ\H[SHULPHQWVLQWKHDUHDRIFRQVWUXFWLRQPDWHULDOVHJVKULQNDJHDQGUHOD[DWLRQ $VZHOODVIRUPDQ\H[SHULPHQWVLQWKHDUHDRIFRQVWUXFWLRQPDWHULDOVHJVKULQNDJHDQGUHOD[DWLRQ
PRQLWRULQJ:HFRQVLGHUFOXVWHUPHDVXUHPHQWVWRKDYHEHQHILFLDODSSOLFDWLRQVLQPDQ\DUHDVRIORQJ PRQLWRULQJ:HFRQVLGHUFOXVWHUPHDVXUHPHQWVWRKDYHEHQHILFLDODSSOLFDWLRQVLQPDQ\DUHDVRIORQJ
WHUPPRQLWRULQJDQGWKHPRGXODUGHVLJQGHVFULEHGLQ6HFWLRQVDQGLVFRQYHQLHQWO\DGDSW WHUPPRQLWRULQJDQGWKHPRGXODUGHVLJQGHVFULEHGLQ6HFWLRQVDQGLVFRQYHQLHQWO\DGDSW
DEOHWRDQ\W\SHVRIPHDVXUHPHQWDQGEDWFKVL]H DEOHWRDQ\W\SHVRIPHDVXUHPHQWDQGEDWFKVL]H

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


0RQLWRULQJ6\VWHP 7HVW6HWXSDQG0HDVXULQJ0HWKRGV 0RQLWRULQJ6\VWHP 7HVW6HWXSDQG0HDVXULQJ0HWKRGV

7KHWKUHHVLJQDOV $WR& DUHEDVHGRQWKHVDPHPHDVXUHGSDUDPHWHULHWKH³KLJK´ 7KHWKUHHVLJQDOV $WR& DUHEDVHGRQWKHVDPHPHDVXUHGSDUDPHWHULHWKH³KLJK´


VLJQDO LV PHDVXUHG YHUVXV WKH WKUHH ³ORZ´ UHIHUHQFH VLJQDOV 5H WR 5H  IRU DOO VLJQDO LV PHDVXUHG YHUVXV WKH WKUHH ³ORZ´ UHIHUHQFH VLJQDOV 5H WR 5H  IRU DOO
VSHFLPHQV7KXVWKHPHDVXUHPHQWVFDQEHVXEGLYLGHGLQWRPHDVXUHPHQWFOXVWHUV ,WR VSHFLPHQV7KXVWKHPHDVXUHPHQWVFDQEHVXEGLYLGHGLQWRPHDVXUHPHQWFOXVWHUV ,WR
,,, DVLOOXVWUDWHGLQ)LJXUH ,,, DVLOOXVWUDWHGLQ)LJXUH

 
)LJXUH 0RQLWRULQJRIWKUHHVLJQDOV $WR& IURPHDFKRIVL[VSHFLPHQV WR )LJXUH 0RQLWRULQJRIWKUHHVLJQDOV $WR& IURPHDFKRIVL[VSHFLPHQV WR
 DJDLQVWWKUHHUHIHUHQFHVLJQDOV 5HWR5H E\GDWDORJJLQJEDVHG  DJDLQVWWKUHHUHIHUHQFHVLJQDOV 5HWR5H E\GDWDORJJLQJEDVHG
RQFOXVWHUPHDVXUHPHQWV RQFOXVWHUPHDVXUHPHQWV
2QHPHDVXUHPHQWFOXVWHUZDVFKRVHQWRFRPSULVHWKH³KLJK´VLJQDOVIURPWZRVSHFL 2QHPHDVXUHPHQWFOXVWHUZDVFKRVHQWRFRPSULVHWKH³KLJK´VLJQDOVIURPWZRVSHFL
PHQV UHGGRWV LHVL[VLJQDOV$GLVWULEXWLRQWHUPLQDOLVHVWDEOLVKHGZKHUHWKHVHVL[ PHQV UHGGRWV LHVL[VLJQDOV$GLVWULEXWLRQWHUPLQDOLVHVWDEOLVKHGZKHUHWKHVHVL[
VLJQDOVDUHPHDVXUHGYHUVXVWKHWKUHH³ORZ´UHIHUHQFHVLJQDOVLHGDWDORJJHUFKDQ VLJQDOVDUHPHDVXUHGYHUVXVWKHWKUHH³ORZ´UHIHUHQFHVLJQDOVLHGDWDORJJHUFKDQ
QHOV EODFNGRWV DUHXVHGLQWRWDO$VLOOXVWUDWHGE\WKHEODFNDUURZVWKHFOXVWHUV ,WR QHOV EODFNGRWV DUHXVHGLQWRWDO$VLOOXVWUDWHGE\WKHEODFNDUURZVWKHFOXVWHUV ,WR
,,, FRUUHVSRQGLQJWRWKH³KLJK´VLJQDOVIURPWKHVSHFLPHQV $WR& DUHFRQQHFWHGWR ,,, FRUUHVSRQGLQJWRWKH³KLJK´VLJQDOVIURPWKHVSHFLPHQV $WR& DUHFRQQHFWHGWR
WKHGLVWULEXWLRQWHUPLQDORQHDIWHUHDFKRWKHUDQGKHQFHPHDVXUHGDQGORJJHGYHUVXV WKHGLVWULEXWLRQWHUPLQDORQHDIWHUHDFKRWKHUDQGKHQFHPHDVXUHGDQGORJJHGYHUVXV
WKH³ORZ´UHIHUHQFHVLJQDOVWKDWDSSO\IRUDOOVSHFLPHQV7KDWZD\WKHUHTXLUHGQXP WKH³ORZ´UHIHUHQFHVLJQDOVWKDWDSSO\IRUDOOVSHFLPHQV7KDWZD\WKHUHTXLUHGQXP
EHURIGDWDORJJHUFKDQQHOVFDQEHUHGXFHGE\WKUHHIURPWRFKDQQHOVLQWKLVH[ EHURIGDWDORJJHUFKDQQHOVFDQEHUHGXFHGE\WKUHHIURPWRFKDQQHOVLQWKLVH[
DPSOH&RQYHQWLRQDOGDWDORJJLQJRIFKDQQHOVLVVWLOOLQDUHDVRQDEOHUDQJHDQGWKH DPSOH&RQYHQWLRQDOGDWDORJJLQJRIFKDQQHOVLVVWLOOLQDUHDVRQDEOHUDQJHDQGWKH
HVWDEOLVKLQJRIDV\VWHPIRUFOXVWHUPHDVXUHPHQWVLVQRWUHTXLUHG+RZHYHULIHJ HVWDEOLVKLQJRIDV\VWHPIRUFOXVWHUPHDVXUHPHQWVLVQRWUHTXLUHG+RZHYHULIHJ
VSHFLPHQVDUHWREHPRQLWRUHGLQFRUUHVSRQGHQFHZLWKWKHDERYHH[DPSOHGDWD VSHFLPHQVDUHWREHPRQLWRUHGLQFRUUHVSRQGHQFHZLWKWKHDERYHH[DPSOHGDWD
ORJJHUFKDQQHOVZRXOGEHUHTXLUHGXVLQJFRQYHQWLRQDOORJJLQJFRPSDUHGWREDVHG ORJJHUFKDQQHOVZRXOGEHUHTXLUHGXVLQJFRQYHQWLRQDOORJJLQJFRPSDUHGWREDVHG
RQ FOXVWHU PHDVXUHPHQWV %HVLGHV WKHVH EHQHILWV LQ UHGXFLQJ WKH QXPEHU RI UHTXLUHG RQ FOXVWHU PHDVXUHPHQWV %HVLGHV WKHVH EHQHILWV LQ UHGXFLQJ WKH QXPEHU RI UHTXLUHG
FKDQQHOVZHWKLQNWKDWWKHDSSOLFDWLRQRIFOXVWHUPHDVXUHPHQWVLVPRVWDGYDQWDJHRXV FKDQQHOVZHWKLQNWKDWWKHDSSOLFDWLRQRIFOXVWHUPHDVXUHPHQWVLVPRVWDGYDQWDJHRXV
LIFHUWDLQRUDOOVLJQDOVPHDVXUHGZLWKLQDFOXVWHUDUHWREHSURFHVVHGE\DGGLWLRQDOGH LIFHUWDLQRUDOOVLJQDOVPHDVXUHGZLWKLQDFOXVWHUDUHWREHSURFHVVHGE\DGGLWLRQDOGH
YLFHV $PRQJ ]HURLPSHGDQFHDPPHWHUV KHQFHIRUWK DPPHWHUV  DV DSSOLHG LQ WKH YLFHV $PRQJ ]HURLPSHGDQFHDPPHWHUV KHQFHIRUWK DPPHWHUV  DV DSSOLHG LQ WKH
VLJQDOSURFHVVLQJIRUWKHVHWXSGHVFULEHGLQWKLV&KDSWHUVLJQDOSURFHVVLQJGHYLFHVIRU VLJQDOSURFHVVLQJIRUWKHVHWXSGHVFULEHGLQWKLV&KDSWHUVLJQDOSURFHVVLQJGHYLFHVIRU
RWKHU DSSOLFDWLRQV PLJKW LQFOXGH DPSOLILHUV ILOWHUV FRQYHUWHUV HJ DQDORJXHGLJLWDO RWKHU DSSOLFDWLRQV PLJKW LQFOXGH DPSOLILHUV ILOWHUV FRQYHUWHUV HJ DQDORJXHGLJLWDO
FRQYHUWHUV µ$'&V¶ WKHUPRFRQYHUWHUVJDXJHFRQYHUWHUV RU:KHDWVWRQHEULGJHV,I FRQYHUWHUV µ$'&V¶ WKHUPRFRQYHUWHUVJDXJHFRQYHUWHUV RU:KHDWVWRQHEULGJHV,I
VLJQDOVDUHWREHSURFHVVHGXVLQJFRQYHQWLRQDOGDWDORJJLQJ HYHU\ VLJQDO WREHSURF VLJQDOVDUHWREHSURFHVVHGXVLQJFRQYHQWLRQDOGDWDORJJLQJ HYHU\ VLJQDO WREHSURF
HVVHG UHTXLUHV DQ LQGLYLGXDO SURFHVVLQJ GHYLFH FRQQHFWHG WR WKH DVVRFLDWHG FKDQQHO HVVHG UHTXLUHV DQ LQGLYLGXDO SURFHVVLQJ GHYLFH FRQQHFWHG WR WKH DVVRFLDWHG FKDQQHO
2QWKHFRQWUDU\XVLQJFOXVWHUPHDVXUHPHQWVWKHVLJQDOSURFHVVLQJGHYLFHRQO\QHHGV 2QWKHFRQWUDU\XVLQJFOXVWHUPHDVXUHPHQWVWKHVLJQDOSURFHVVLQJGHYLFHRQO\QHHGV
WREHFRQQHFWHGWRWKHDVVRFLDWHGWHUPLQDOVRQWKHFRQQHFWLRQWHUPLQDO%DVHGRQWKH WREHFRQQHFWHGWRWKHDVVRFLDWHGWHUPLQDOVRQWKHFRQQHFWLRQWHUPLQDO%DVHGRQWKH
DERYH H[DPSOH DQG FRQVLGHULQJ WKDW HJ VLJQDO ³$´ RI DOO VSHFLPHQV LV WR EH SURF DERYH H[DPSOH DQG FRQVLGHULQJ WKDW HJ VLJQDO ³$´ RI DOO VSHFLPHQV LV WR EH SURF

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7HVW6HWXSDQG0HDVXULQJ0HWKRGV 0RQLWRULQJ6\VWHP 7HVW6HWXSDQG0HDVXULQJ0HWKRGV 0RQLWRULQJ6\VWHP

HVVHGWKLVZRXOGUHTXLUHVL[SURFHVVLQJGHYLFHVIRUFRQYHQWLRQDOGDWDORJJLQJDQGFRU HVVHGWKLVZRXOGUHTXLUHVL[SURFHVVLQJGHYLFHVIRUFRQYHQWLRQDOGDWDORJJLQJDQGFRU
UHVSRQGLQJO\GHYLFHVZKHQFRQVLGHULQJVSHFLPHQV<HWGDWDORJJLQJEDVHGRQ UHVSRQGLQJO\GHYLFHVZKHQFRQVLGHULQJVSHFLPHQV<HWGDWDORJJLQJEDVHGRQ
FOXVWHUPHDVXUHPHQWVLQWKHVDPHFRQILJXUDWLRQZRXOGDOORZPRQLWRULQJRIDWKHRUHWL FOXVWHUPHDVXUHPHQWVLQWKHVDPHFRQILJXUDWLRQZRXOGDOORZPRQLWRULQJRIDWKHRUHWL
FDOO\XQOLPLWHGQXPEHURIVSHFLPHQVXVLQJRQO\WZRSURFHVVLQJGHYLFHV FDOO\XQOLPLWHGQXPEHURIVSHFLPHQVXVLQJRQO\WZRSURFHVVLQJGHYLFHV

 6ZLWFK&DUGV  6ZLWFK&DUGV


,Q WKLV 6HFWLRQ DV ZHOO DV LQ 6HFWLRQ  WKH LPSOHPHQWDWLRQ RI FOXVWHU PHDVXUH ,Q WKLV 6HFWLRQ DV ZHOO DV LQ 6HFWLRQ  WKH LPSOHPHQWDWLRQ RI FOXVWHU PHDVXUH
PHQWVIRURXUSXUSRVHVDUHGHVFULEHGEDVHGRQWKHLQVWUXPHQWHGPRUWDUVSHFLPHQZLWK PHQWVIRURXUSXUSRVHVDUHGHVFULEHGEDVHGRQWKHLQVWUXPHQWHGPRUWDUVSHFLPHQZLWK
µ(&DW¶:LWKWKHH[FHSWLRQRIVSHFLPHQVZKHUHRQO\µ(FRUU¶LVPRQLWRUHGFRQQHFWLRQ µ(&DW¶:LWKWKHH[FHSWLRQRIVSHFLPHQVZKHUHRQO\µ(FRUU¶LVPRQLWRUHGFRQQHFWLRQ
RIDOORWKHUVSHFLPHQW\SHVZLWKRXWµ(&DW¶DQGRUµ((:V¶IROORZVWKHVDPHSULQFLSOH RIDOORWKHUVSHFLPHQW\SHVZLWKRXWµ(&DW¶DQGRUµ((:V¶IROORZVWKHVDPHSULQFLSOH
ZKLOHWKHFRQQHFWLRQVIRUPLVVLQJFRPSRQHQWVDUHVLPSO\OHIWRSHQ6SHFLPHQZKHUH ZKLOHWKHFRQQHFWLRQVIRUPLVVLQJFRPSRQHQWVDUHVLPSO\OHIWRSHQ6SHFLPHQZKHUH
RQO\µ(FRUU¶LVPRQLWRUHGFDQEHFRQQHFWHGWRRSHQµ((:V¶WHUPLQDOVRI RWKHUVSHFL RQO\µ(FRUU¶LVPRQLWRUHGFDQEHFRQQHFWHGWRRSHQµ((:V¶WHUPLQDOVRI RWKHUVSHFL
PHQV ZLWK µ(&DW¶ EXW ZLWKRXW µ((:V¶ HJ LQ µ7HVW ,,¶ WKH FHPHQW SDVWH VSHFLPHQV PHQV ZLWK µ(&DW¶ EXW ZLWKRXW µ((:V¶ HJ LQ µ7HVW ,,¶ WKH FHPHQW SDVWH VSHFLPHQV
ZLWKRXWµ(&DW¶ LQGLFHVHQGLQJZLWK³'´ ZHUHFRQQHFWHGWRWKHµ((:¶WHUPLQDOVRI ZLWKRXWµ(&DW¶ LQGLFHVHQGLQJZLWK³'´ ZHUHFRQQHFWHGWRWKHµ((:¶WHUPLQDOVRI
WKHFHPHQWSDVWHVSHFLPHQVZLWKµ(&DW¶ LQGLFHVHQGLQJZLWK³&´  FI6HFWLRQ  WKHFHPHQWSDVWHVSHFLPHQVZLWKµ(&DW¶ LQGLFHVHQGLQJZLWK³&´  FI6HFWLRQ 
$V LQGLFDWHG LQ 6HFWLRQ  HLJKW VLJQDOV IRU HDFK LQVWUXPHQWHG PRUWDU VSHFLPHQ $V LQGLFDWHG LQ 6HFWLRQ  HLJKW VLJQDOV IRU HDFK LQVWUXPHQWHG PRUWDU VSHFLPHQ
ZLWKµ(&DW¶ZHUHDVVHVVHGLHWKHUHEDUWKHµ(&DW¶DQGWKHVL[µ((:V¶ FI)LJXUH ZLWKµ(&DW¶ZHUHDVVHVVHGLHWKHUHEDUWKHµ(&DW¶DQGWKHVL[µ((:V¶ FI)LJXUH
LQ6HFWLRQ $VWKHµ(&DW¶FRQGXFWRUIRUWKHHVWDEOLVKPHQWRIWKHPDFURFHOO LQ6HFWLRQ $VWKHµ(&DW¶FRQGXFWRUIRUWKHHVWDEOLVKPHQWRIWKHPDFURFHOO
ZDVIUHTXHQWO\FRQQHFWHGDQGGLVFRQQHFWHGIURPWKHV\VWHPDQGµ(FRUU¶RIWKHµ(&DW¶ ZDVIUHTXHQWO\FRQQHFWHGDQGGLVFRQQHFWHGIURPWKHV\VWHPDQGµ(FRUU¶RIWKHµ(&DW¶
ZDVDOVRWREHDVVHVVHGGXULQJSHULRGVRIGLVFRQQHFWLRQWZRVHSDUDWHµ(&DW¶FRQQHF ZDVDOVRWREHDVVHVVHGGXULQJSHULRGVRIGLVFRQQHFWLRQWZRVHSDUDWHµ(&DW¶FRQQHF
WLRQV µLPDF¶ DQG µ(FRUU¶  ZHUH UHTXLUHG VHH )LJXUH  7KXV DOWRJHWKHU QLQH VLJQDOV WLRQV µLPDF¶ DQG µ(FRUU¶  ZHUH UHTXLUHG VHH )LJXUH  7KXV DOWRJHWKHU QLQH VLJQDOV
ZHUHPHDVXUHGIURPHDFKLQVWUXPHQWHGPRUWDUVSHFLPHQZLWKµ(&DW¶2QHPHDVXUH ZHUHPHDVXUHGIURPHDFKLQVWUXPHQWHGPRUWDUVSHFLPHQZLWKµ(&DW¶2QHPHDVXUH
PHQWFOXVWHUFRUUHVSRQGHGWRWZRVSHFLPHQV LQSXWVLJQDOV  PHQWFOXVWHUFRUUHVSRQGHGWRWZRVSHFLPHQV LQSXWVLJQDOV 
$VLOOXVWUDWHGLQ)LJXUH>$@DQG>%@WKHFRQGXFWRUVDVVRFLDWHGZLWKHDFKPHDV $VLOOXVWUDWHGLQ)LJXUH>$@DQG>%@WKHFRQGXFWRUVDVVRFLDWHGZLWKHDFKPHDV
XUHPHQW FOXVWHU WZR QLQHFRQGXFWRU FDEOHV  ZHUH FRQQHFWHG WR RQH VZLWFK FDUG $ XUHPHQW FOXVWHU WZR QLQHFRQGXFWRU FDEOHV  ZHUH FRQQHFWHG WR RQH VZLWFK FDUG $
VZLWFKFDUGZDVEDVHGRQDSULQWHGFLUFXLWERDUG µ3&%¶ HTXLSSHGZLWKWHQWZRSROH VZLWFKFDUGZDVEDVHGRQDSULQWHGFLUFXLWERDUG µ3&%¶ HTXLSSHGZLWKWHQWZRSROH
FKDQJHRYHUUHOD\V 5/WR5/  FKDQJHRYHUUHOD\V 5/WR5/ 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


0RQLWRULQJ6\VWHP 7HVW6HWXSDQG0HDVXULQJ0HWKRGV 0RQLWRULQJ6\VWHP 7HVW6HWXSDQG0HDVXULQJ0HWKRGV

 
)LJXUH 6ZLWFK FDUG FRUUHVSRQGLQJ WR RQH PHDVXUHPHQW FOXVWHU >$@ DQG >%@ )LJXUH 6ZLWFK FDUG FRUUHVSRQGLQJ WR RQH PHDVXUHPHQW FOXVWHU >$@ DQG >%@
&RQQHFWLRQV IRU WZR LQVWUXPHQWHG PRUWDU VSHFLPHQV ZLWK H[WHUQDO &RQQHFWLRQV IRU WZR LQVWUXPHQWHG PRUWDU VSHFLPHQV ZLWK H[WHUQDO
FDWKRGHµ(&DW¶µLPDF¶PDFURFHOOFXUUHQWDQGµ(FRUU¶FRUURVLRQSRWHQ FDWKRGHµ(&DW¶µLPDF¶PDFURFHOOFXUUHQWDQGµ(FRUU¶FRUURVLRQSRWHQ
WLDO 7KH FRORXU FRGH XVHGIRU WKH FRQGXFWRUV FRUUHVSRQGV WR WKH FRO WLDO 7KH FRORXU FRGH XVHGIRU WKH FRQGXFWRUV FRUUHVSRQGV WR WKH FRO
RXUVXVHGLQWKHVFKHPHIRUWKHFRQQHFWLRQVHVWDEOLVKHGRQWKHGLVWULEX RXUVXVHGLQWKHVFKHPHIRUWKHFRQQHFWLRQVHVWDEOLVKHGRQWKHGLVWULEX
WLRQ WHUPLQDO ERDUG FI 7DEOH  LQ 6HFWLRQ   >&@ 3LQV RI WZR WLRQ WHUPLQDO ERDUG FI 7DEOH  LQ 6HFWLRQ   >&@ 3LQV RI WZR
SROH FKDQJHRYHU UHOD\ DQG DVVRFLDWHG FLUFXLW GLDJUDP >'@ 6WDQGDUG SROH FKDQJHRYHU UHOD\ DQG DVVRFLDWHG FLUFXLW GLDJUDP >'@ 6WDQGDUG
SLQ SOXJ IRU HOHFWURFKHPLFDO LPSHGDQFH VSHFWURVFRS\ µ(,6¶ SRODUL SLQ SOXJ IRU HOHFWURFKHPLFDO LPSHGDQFH VSHFWURVFRS\ µ(,6¶ SRODUL
VDWLRQFXUYHVDQGRWKHUVXSSOHPHQWDU\HOHFWURFKHPLFDOPHDVXUHPHQWV VDWLRQFXUYHVDQGRWKHUVXSSOHPHQWDU\HOHFWURFKHPLFDOPHDVXUHPHQWV
FI6HFWLRQ 7KHFRORXUFRGHRIWKHSLQV  FRUUHVSRQGVWRWKH FI6HFWLRQ 7KHFRORXUFRGHRIWKHSLQV  FRUUHVSRQGVWRWKH
FRORXUVRIWKHFRQGXFWRUVDQGWRWKHFRORXUVXVHGIRUWKHFRQQHFWLRQV FRORXUVRIWKHFRQGXFWRUVDQGWRWKHFRORXUVXVHGIRUWKHFRQQHFWLRQV
RQWKHDGDSWHUWHUPLQDOERDUGFXVWRPLVHGIRUFRQQHFWLRQWRWKHDSSOLHG RQWKHDGDSWHUWHUPLQDOERDUGFXVWRPLVHGIRUFRQQHFWLRQWRWKHDSSOLHG
µ(,6¶HTXLSPHQW FI)LJXUHLQ6HFWLRQ  µ(,6¶HTXLSPHQW FI)LJXUHLQ6HFWLRQ 
(DFKUHOD\DOORZHGWRJJOLQJRIWZRLQSXWVLJQDOVVRWKDWRQHVZLWFKFDUGZDVFDSDEOH (DFKUHOD\DOORZHGWRJJOLQJRIWZRLQSXWVLJQDOVVRWKDWRQHVZLWFKFDUGZDVFDSDEOH
RIWUDQVIHUULQJVLJQDOV7ZRWHQSLQVFUHZWHUPLQDOVZHUHLQVWDOOHGIRULQSXWFRQ RIWUDQVIHUULQJVLJQDOV7ZRWHQSLQVFUHZWHUPLQDOVZHUHLQVWDOOHGIRULQSXWFRQ
QHFWLRQVRQWKHOHIWKDQGVLGHRIWKHVZLWFKFDUG -DQG- $OOWKHUHOD\VZHUHV\Q QHFWLRQVRQWKHOHIWKDQGVLGHRIWKHVZLWFKFDUG -DQG- $OOWKHUHOD\VZHUHV\Q
FKURQRXVO\VXSSOLHGZLWKDQH[FLWDWLRQYROWDJHRI9ZKHQWKHDVVRFLDWHGFDUGZDV FKURQRXVO\VXSSOLHGZLWKDQH[FLWDWLRQYROWDJHRI9ZKHQWKHDVVRFLDWHGFDUGZDV
WULJJHUHGE\DP$VLJQDOZKLFKZDVVXSSOLHGE\DGLJLWDOLQSXWRXWSXWµ,2¶ERDUG WULJJHUHGE\DP$VLJQDOZKLFKZDVVXSSOLHGE\DGLJLWDOLQSXWRXWSXWµ,2¶ERDUG
FRQQHFWHGWRDQ,%0FRPSDWLEOH3&DQGFRQWUROOHGE\D/DE9,(:URXWLQH>1,@ FRQQHFWHGWRDQ,%0FRPSDWLEOH3&DQGFRQWUROOHGE\D/DE9,(:URXWLQH>1,@
FI6HFWLRQ  FI6HFWLRQ 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7HVW6HWXSDQG0HDVXULQJ0HWKRGV 0RQLWRULQJ6\VWHP 7HVW6HWXSDQG0HDVXULQJ0HWKRGV 0RQLWRULQJ6\VWHP

&RQQHFWLRQVIRUWKHLQGLYLGXDOWULJJHUVLJQDODQGWKHVKDUHGH[FLWDWLRQYROWDJHVXSSO\ &RQQHFWLRQVIRUWKHLQGLYLGXDOWULJJHUVLJQDODQGWKHVKDUHGH[FLWDWLRQYROWDJHVXSSO\
ZHUHHVWDEOLVKHGRQSLQVRIWKHSLQVRFNHWRQWKHULJKWKDQGVLGHRIWKHVZLWFK ZHUHHVWDEOLVKHGRQSLQVRIWKHSLQVRFNHWRQWKHULJKWKDQGVLGHRIWKHVZLWFK
FDUG - (YHU\FRQQHFWLRQRQWKHSLQVRFNHWZDVHVWDEOLVKHGRQWZRSLQVWRHQ FDUG - (YHU\FRQQHFWLRQRQWKHSLQVRFNHWZDVHVWDEOLVKHGRQWZRSLQVWRHQ
VXUHVHFXUHFRQQHFWLRQ7KHH[FLWDWLRQYROWDJHWRJJOHGWKHUHOD\IURPSLQ  WR VXUHVHFXUHFRQQHFWLRQ7KHH[FLWDWLRQYROWDJHWRJJOHGWKHUHOD\IURPSLQ  WR
SLQ  VHH)LJXUH>&@,QWKLVVHWWLQJWKHLQSXWVLJQDOVZHUHFRQQHFWHGWR SLQ  VHH)LJXUH>&@,QWKLVVHWWLQJWKHLQSXWVLJQDOVZHUHFRQQHFWHGWR
SLQVRIWKHRXWSXWVRFNHW -  SLQVRIWKHRXWSXWVRFNHW - 
7KHVZLWFKFDUGVZHUHVWDFNHGLQDFXVWRPLVHGSODVWLFIUDPHDQGWKHVLJQDOFRQQHF 7KHVZLWFKFDUGVZHUHVWDFNHGLQDFXVWRPLVHGSODVWLFIUDPHDQGWKHVLJQDOFRQQHF
WLRQV SLQV- ZHUHGDLV\FKDLQHGE\DFRQGXFWRUULEERQFDEOHZLWKLQ WLRQV SLQV- ZHUHGDLV\FKDLQHGE\DFRQGXFWRUULEERQFDEOHZLWKLQ
SXWSOXJVDQGDQRXWSXWVRFNHWIRUFRQQHFWLRQWRDGLVWULEXWLRQWHUPLQDOERDUGDVZHOO SXWSOXJVDQGDQRXWSXWVRFNHWIRUFRQQHFWLRQWRDGLVWULEXWLRQWHUPLQDOERDUGDVZHOO
DVWRDQLQSXWVRFNHWIRUWKHH[WHQVLRQRIWKHPRQLWRULQJV\VWHP$VWKHVZLWFKFDUGV DVWRDQLQSXWVRFNHWIRUWKHH[WHQVLRQRIWKHPRQLWRULQJV\VWHP$VWKHVZLWFKFDUGV
ZHUHDFWLYDWHGRQHDIWHUWKHRWKHURQO\RQHVZLWFKFDUGZDVWUDQVIHUULQJVLJQDOVWRWKH ZHUHDFWLYDWHGRQHDIWHUWKHRWKHURQO\RQHVZLWFKFDUGZDVWUDQVIHUULQJVLJQDOVWRWKH
GLVWULEXWLRQWHUPLQDOERDUGDWDQ\RQHWLPH GLVWULEXWLRQWHUPLQDOERDUGDWDQ\RQHWLPH
:KLOH D VZLWFK FDUG ZDV GHDFWLYDWHG WKH FXUUHQW FRQQHFWLRQ EHWZHHQ WKH UHEDU DQG :KLOH D VZLWFK FDUG ZDV GHDFWLYDWHG WKH FXUUHQW FRQQHFWLRQ EHWZHHQ WKH UHEDU DQG
µ(&DW¶ZDVHVWDEOLVKHGE\WKHVROGHUHGVKRUWFLUFXLWEHWZHHQUHOD\SLQDQGSLQ µ(&DW¶ZDVHVWDEOLVKHGE\WKHVROGHUHGVKRUWFLUFXLWEHWZHHQUHOD\SLQDQGSLQ
RIWKHWZRDVVRFLDWHGUHOD\V 5/DQG5/ 7KHFKDQJHRYHUIXQFWLRQDOLW\RIWKHUH RIWKHWZRDVVRFLDWHGUHOD\V 5/DQG5/ 7KHFKDQJHRYHUIXQFWLRQDOLW\RIWKHUH
OD\V HQDEOHG FRQQHFWLRQ RI UHOD\ SLQ    WR UHOD\ SLQ    LQ WKH GHDFWLYDWHG OD\V HQDEOHG FRQQHFWLRQ RI UHOD\ SLQ    WR UHOD\ SLQ    LQ WKH GHDFWLYDWHG
VWDWH VHH )LJXUH  >&@ ,Q WKLV ZD\ WKH VFUHZ WHUPLQDO SLQV    DQG    VWDWH VHH )LJXUH  >&@ ,Q WKLV ZD\ WKH VFUHZ WHUPLQDO SLQV    DQG   
ZKLFKFRUUHVSRQGHGWRWKHUHEDUDQGWKHµ(&DW¶UHVSHFWLYHO\ZHUHFRQQHFWHG ZKLFKFRUUHVSRQGHGWRWKHUHEDUDQGWKHµ(&DW¶UHVSHFWLYHO\ZHUHFRQQHFWHG
7KHQLQHFRQGXFWRUFDEOHIURPHDFKVSHFLPHQWUDQVIHUUHGWKHVLJQDOVRIWKHUHEDUWKH 7KHQLQHFRQGXFWRUFDEOHIURPHDFKVSHFLPHQWUDQVIHUUHGWKHVLJQDOVRIWKHUHEDUWKH
VL[µ((:V¶DQGWKHµ(&DW¶VHH)LJXUH$VPHQWLRQHGWKHµ(&DW¶ZDVFRQQHFWHG VL[µ((:V¶DQGWKHµ(&DW¶VHH)LJXUH$VPHQWLRQHGWKHµ(&DW¶ZDVFRQQHFWHG
WRWZRWHUPLQDOVVLQFHWKHµ(&DWLPDF¶FRQGXFWRUZDVFRQQHFWHGDQGGLVFRQQHFWHGDW WRWZRWHUPLQDOVVLQFHWKHµ(&DWLPDF¶FRQGXFWRUZDVFRQQHFWHGDQGGLVFRQQHFWHGDW
VHWLQWHUYDOV6RWKHFRUURVLRQSRWHQWLDORIWKHµ(&DW¶ZDVH[FOXVLYHO\ PRQLWRUHGE\ VHWLQWHUYDOV6RWKHFRUURVLRQSRWHQWLDORIWKHµ(&DW¶ZDVH[FOXVLYHO\ PRQLWRUHGE\
WKHDGGLWLRQDOFRQGXFWRUµ(&DW¶µ(FRUU¶$FWLYDWLRQDQGGHDFWLYDWLRQRIWKHµLPDF¶FRQ WKHDGGLWLRQDOFRQGXFWRUµ(&DW¶µ(FRUU¶$FWLYDWLRQDQGGHDFWLYDWLRQRIWKHµLPDF¶FRQ
QHFWLRQ WKH PDFURFHOO  ZDV SHUIRUPHG E\ D PDQXDO WRJJOH VZLWFK XQLW 7KH VZLWFK QHFWLRQ WKH PDFURFHOO  ZDV SHUIRUPHG E\ D PDQXDO WRJJOH VZLWFK XQLW 7KH VZLWFK
XQLW ZDV EDVHG RQ D FLUFXLW ERDUG ZLWK D VHULHV RI GXDO LQOLQH SDFNDJH µ',3¶  XQLW ZDV EDVHG RQ D FLUFXLW ERDUG ZLWK D VHULHV RI GXDO LQOLQH SDFNDJH µ',3¶ 
VZLWFKHVFRQQHFWHGWRDVHWRILQSXWDQGRXWSXWVFUHZWHUPLQDOV VZLWFKHVFRQQHFWHGWRDVHWRILQSXWDQGRXWSXWVFUHZWHUPLQDOV
7KH FRQGXFWRUV RI DOO FRQQHFWLRQV H[FHSW WKH µ(&DW LPDF¶ FRQGXFWRU ZHUH ORRSHG 7KH FRQGXFWRUV RI DOO FRQQHFWLRQV H[FHSW WKH µ(&DW LPDF¶ FRQGXFWRU ZHUH ORRSHG
WKURXJK WKH VFUHZ WHUPLQDO DQG FRQQHFWHG WR D VWDQGDUG SLQ SOXJ VHH )LJXUH  WKURXJK WKH VFUHZ WHUPLQDO DQG FRQQHFWHG WR D VWDQGDUG SLQ SOXJ VHH )LJXUH 
>'@$UELWUDU\PHDVXUHPHQWHTXLSPHQWHJDSRWHQWLRVWDWDYROWPHWHURUDQHOHFWUR >'@$UELWUDU\PHDVXUHPHQWHTXLSPHQWHJDSRWHQWLRVWDWDYROWPHWHURUDQHOHFWUR
FKHPLFDO QRLVH DQDO\]HU µ(1$¶  FRXOG EH FRQQHFWHG WR WKLV SOXJ YLD FXVWRPLVHG FKHPLFDO QRLVH DQDO\]HU µ(1$¶  FRXOG EH FRQQHFWHG WR WKLV SOXJ YLD FXVWRPLVHG
DGDSWHUV+RZHYHUGXULQJµ7HVW ,,¶WKLVSOXJZDVPDLQO\XVHGIRU FRQQHFWLRQWRWKH DGDSWHUV+RZHYHUGXULQJµ7HVW ,,¶WKLVSOXJZDVPDLQO\XVHGIRU FRQQHFWLRQWRWKH
µ(,6¶HTXLSPHQW FI6HFWLRQ  µ(,6¶HTXLSPHQW FI6HFWLRQ 

 'LVWULEXWLRQ7HUPLQDO%RDUGDQG'DWDORJJHU  'LVWULEXWLRQ7HUPLQDO%RDUGDQG'DWDORJJHU


7KHQLQHRXWSXWVLJQDOVRIHDFKRIWKHWZRVSHFLPHQVFRQQHFWHGWRRQHFDUGZHUHGL 7KHQLQHRXWSXWVLJQDOVRIHDFKRIWKHWZRVSHFLPHQVFRQQHFWHGWRRQHFDUGZHUHGL
YHUWHGRQWKHGLVWULEXWLRQWHUPLQDOERDUGLQWRRQHFXUUHQWDQGSRWHQWLDOPRQLWRULQJ YHUWHGRQWKHGLVWULEXWLRQWHUPLQDOERDUGLQWRRQHFXUUHQWDQGSRWHQWLDOPRQLWRULQJ
FKDQQHOV VHH 7DEOH  ,Q WKLV ZD\  FKDQQHOV ZHUH PRQLWRUHG ZKHQ RQHFOXVWHU FKDQQHOV VHH 7DEOH  ,Q WKLV ZD\  FKDQQHOV ZHUH PRQLWRUHG ZKHQ RQHFOXVWHU
ZDVPHDVXUHG ZDVPHDVXUHG

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


0RQLWRULQJ6\VWHP 7HVW6HWXSDQG0HDVXULQJ0HWKRGV 0RQLWRULQJ6\VWHP 7HVW6HWXSDQG0HDVXULQJ0HWKRGV

7DEOH &RQQHFWLRQVHVWDEOLVKHGRQWKHGLVWULEXWLRQWHUPLQDOERDUGDQGDVVRFL 7DEOH &RQQHFWLRQVHVWDEOLVKHGRQWKHGLVWULEXWLRQWHUPLQDOERDUGDQGDVVRFL


DWHGGDWDORJJHUFKDQQHOVDQGLQGLFHVµ(&DW¶H[WHUQDOFDWKRGHµ((:¶ DWHGGDWDORJJHUFKDQQHOVDQGLQGLFHVµ(&DW¶H[WHUQDOFDWKRGHµ((:¶
HPEHGGHG HOHFWURGH ZLUH µ(FRUU¶ FRUURVLRQ SRWHQWLDO µLPDF¶ PDFURFHOO HPEHGGHG HOHFWURGH ZLUH µ(FRUU¶ FRUURVLRQ SRWHQWLDO µLPDF¶ PDFURFHOO
FXUUHQW DQG µ6&(¶ VDWXUDWHG FDORPHO HOHFWURGH 7KH FRORXU FRGH IRU FXUUHQW DQG µ6&(¶ VDWXUDWHG FDORPHO HOHFWURGH 7KH FRORXU FRGH IRU
WKHFRQQHFWLRQVFRUUHVSRQGVWRWKHFRORXUVXVHGIRUWKHFRQGXFWRUVFRQ WKHFRQQHFWLRQVFRUUHVSRQGVWRWKHFRORXUVXVHGIRUWKHFRQGXFWRUVFRQ
QHFWHGWRWKHVZLWFKFDUG FI)LJXUHLQ6HFWLRQ  QHFWHGWRWKHVZLWFKFDUG FI)LJXUHLQ6HFWLRQ 

&KDQQHO &KDQQHO
+LJK /RZ ,QGH[ +LJK /RZ ,QGH[
6SHFLPHQ 6SHFLPHQ 6SHFLPHQ 6SHFLPHQ
  µ(&DWµLPDF¶ µLPDF¶KLJK  5HEDU µLPDF¶ORZ     µ(&DWµLPDF¶ µLPDF¶KLJK  5HEDU µLPDF¶ORZ  
  5HEDUµ(FRUU¶ µ6&(¶    5HEDUµ(FRUU¶ µ6&(¶ 
  µ(&DW¶µ(FRUU¶ µ6&(¶    µ(&DW¶µ(FRUU¶ µ6&(¶ 
  µ((:¶ µ6&(¶    µ((:¶ µ6&(¶ 
  µ((:¶ µ6&(¶    µ((:¶ µ6&(¶ 
  µ((:¶ µ6&(¶    µ((:¶ µ6&(¶ 
  µ((:¶ µ6&(¶    µ((:¶ µ6&(¶ 
  µ((:¶ µ6&(¶    µ((:¶ µ6&(¶ 
  µ((:¶ µ6&(¶    µ((:¶ µ6&(¶ 
  5HEDUµ(FRUU¶ µ6&(¶    5HEDUµ(FRUU¶ µ6&(¶ 
  µ(&DW¶µ(FRUU¶ µ6&(¶    µ(&DW¶µ(FRUU¶ µ6&(¶ 
  µ((:¶ µ6&(¶    µ((:¶ µ6&(¶ 
  µ((:¶ µ6&(¶    µ((:¶ µ6&(¶ 
  µ((:¶ µ6&(¶    µ((:¶ µ6&(¶ 
  µ((:¶ µ6&(¶    µ((:¶ µ6&(¶ 
  µ((:¶ µ6&(¶    µ((:¶ µ6&(¶ 
  µ((:¶ µ6&(¶    µ((:¶ µ6&(¶ 
  µ(&DW¶µ(FRUU¶ 5HEDUµ(FRUU¶    µ(&DW¶µ(FRUU¶ 5HEDUµ(FRUU¶ 
  µ((:¶ 5HEDUµ(FRUU¶    µ((:¶ 5HEDUµ(FRUU¶ 
  µ((:¶ 5HEDUµ(FRUU¶    µ((:¶ 5HEDUµ(FRUU¶ 
  µ((:¶ 5HEDUµ(FRUU¶    µ((:¶ 5HEDUµ(FRUU¶ 
  µ((:¶ 5HEDUµ(FRUU¶    µ((:¶ 5HEDUµ(FRUU¶ 
  µ((:¶ 5HEDUµ(FRUU¶    µ((:¶ 5HEDUµ(FRUU¶ 
  µ((:¶ 5HEDUµ(FRUU¶    µ((:¶ 5HEDUµ(FRUU¶ 
 
7KHFKDQQHOVZHUHSURYLGHGE\DGDWDORJJHUEDVHGRQDQDORJXHPHDVXUHPHQWVLHWKH 7KHFKDQQHOVZHUHSURYLGHGE\DGDWDORJJHUEDVHGRQDQDORJXHPHDVXUHPHQWVLHWKH
FKDQQHOVZHUHUHOD\FRQWUROOHGDQGORJJHGLQGLYLGXDOO\RQHDIWHUWKHRWKHU7KHGDWD FKDQQHOVZHUHUHOD\FRQWUROOHGDQGORJJHGLQGLYLGXDOO\RQHDIWHUWKHRWKHU7KHGDWD
ORJJHU ZDV HTXLSSHG ZLWK WKUHH PXOWLSOH[HU FDUGV ZLWK FKDQQHO QXPEHUV  ORJJHU ZDV HTXLSSHG ZLWK WKUHH PXOWLSOH[HU FDUGV ZLWK FKDQQHO QXPEHUV 
DQG$OOWKHPXOWLSOH[HUWHUPLQDOVH[FHSWWKHRQHVFRUUHVSRQGLQJWR DQG$OOWKHPXOWLSOH[HUWHUPLQDOVH[FHSWWKHRQHVFRUUHVSRQGLQJWR
FKDQQHOQXPEHUVZHUHFRQQHFWHGWRWKHGLVWULEXWLRQWHUPLQDOERDUGE\WKUHH FKDQQHOQXPEHUVZHUHFRQQHFWHGWRWKHGLVWULEXWLRQWHUPLQDOERDUGE\WKUHH
FRQGXFWRU FDEOHV 7KDW PHDQV WKDW DOWRJHWKHU  GDWDORJJHU FKDQQHOV ZHUH PDGH FRQGXFWRU FDEOHV 7KDW PHDQV WKDW DOWRJHWKHU  GDWDORJJHU FKDQQHOV ZHUH PDGH
DYDLODEOHRQWKHGLVWULEXWLRQWHUPLQDOERDUG DYDLODEOHRQWKHGLVWULEXWLRQWHUPLQDOERDUG
7KHWHUPLQDOERDUGHQDEOHGGLVWULEXWLRQRIWKHLQSXWVLJQDOVIURPWKHVZLWFKFDUGVWDFN 7KHWHUPLQDOERDUGHQDEOHGGLVWULEXWLRQRIWKHLQSXWVLJQDOVIURPWKHVZLWFKFDUGVWDFN
FRQQHFWLRQV  FRQGXFWRUV  DQG WKH µ6&(V¶ DV ZHOO DV DGGLWLRQDO HOHFWURGHV WR WKH FRQQHFWLRQV  FRQGXFWRUV  DQG WKH µ6&(V¶ DV ZHOO DV DGGLWLRQDO HOHFWURGHV WR WKH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7HVW6HWXSDQG0HDVXULQJ0HWKRGV 0RQLWRULQJ6\VWHP 7HVW6HWXSDQG0HDVXULQJ0HWKRGV 0RQLWRULQJ6\VWHP

GDWDORJJHUFKDQQHOVLHWZRWLPHV KLJKDQGORZ FRQGXFWRUV7KHGLVWULEXWLRQRI GDWDORJJHUFKDQQHOVLHWZRWLPHV KLJKDQGORZ FRQGXFWRUV7KHGLVWULEXWLRQRI


VLJQDOV RQ WKH WHUPLQDOERDUG ZDVSHUIRUPHGE\ FRQQHFWLQJWKHVZLWFKFDUGFRQGXF VLJQDOV RQ WKH WHUPLQDOERDUG ZDVSHUIRUPHGE\ FRQQHFWLQJ WKH VZLWFK FDUGFRQGXF
WRUVWRWKHDVVRFLDWHGWHUPLQDOVRIWKHGDWDORJJHU7KHGLVWULEXWLRQWHUPLQDOERDUGFRQ WRUVWRWKHDVVRFLDWHGWHUPLQDOVRIWKHGDWDORJJHU7KHGLVWULEXWLRQWHUPLQDOERDUGFRQ
VLVWHGRIDFLUFXLWERDUGZLWKIRXUSLQVRFNHWVDQGVHYHQVHWVRISLQVFUHZWHU VLVWHGRIDFLUFXLWERDUGZLWKIRXUSLQVRFNHWVDQGVHYHQVHWVRISLQVFUHZWHU
PLQDOV2QHSLQVRFNHWZDVFRQQHFWHGWRWKHFRQGXFWRUULEERQFDEOHFRQQHFWLRQ PLQDOV2QHSLQVRFNHWZDVFRQQHFWHGWRWKHFRQGXFWRUULEERQFDEOHFRQQHFWLRQ
WRWKHVZLWFKFDUGVWDFN DVLQJOHVFUHZWHUPLQDORQWKHVZLWFKFDUGVZDVFRQQHFWHGWR WRWKHVZLWFKFDUGVWDFN DVLQJOHVFUHZWHUPLQDORQWKHVZLWFKFDUGVZDVFRQQHFWHGWR
WZRFRQGXFWRUV DQGWKHRWKHUWKUHHZHUHFRQQHFWHGWRWKHWKUHHFRQGXFWRUFDEOHV WZRFRQGXFWRUV DQGWKHRWKHUWKUHHZHUHFRQQHFWHGWRWKHWKUHHFRQGXFWRUFDEOHV
IURP WKH PXOWLSOH[HU FDUGV 2QH VHW RI SLQ VFUHZ WHUPLQDOV ZDV FRQQHFWHG WR WKH IURP WKH PXOWLSOH[HU FDUGV 2QH VHW RI SLQ VFUHZ WHUPLQDOV ZDV FRQQHFWHG WR WKH
VZLWFK FDUG VWDFN VRFNHW DQG WKH RWKHU VL[ VHWV ZHUH FRQQHFWHG WR WKH VRFNHWV FRUUH VZLWFK FDUG VWDFN VRFNHW DQG WKH RWKHU VL[ VHWV ZHUH FRQQHFWHG WR WKH VRFNHWV FRUUH
VSRQGLQJWRWKHKLJKDQGORZWHUPLQDOVRIWKHDVVRFLDWHGGDWDORJJHUFKDQQHOV VSRQGLQJWRWKHKLJKDQGORZWHUPLQDOVRIWKHDVVRFLDWHGGDWDORJJHUFKDQQHOV
'DWDORJJHU FKDQQHO    ZDV DVVLJQHG WR WKH FXUUHQW FKDQQHO ZKLOH FKDQQHOV 'DWDORJJHU FKDQQHO    ZDV DVVLJQHG WR WKH FXUUHQW FKDQQHO ZKLOH FKDQQHOV
  DQG  ZHUHWKHFKDQQHOVIRUµ(FRUU¶PRQLWRULQJ   DQG  ZHUHWKHFKDQQHOVIRUµ(FRUU¶PRQLWRULQJ
RIHDFKLQVWUXPHQWHGPRUWDUVSHFLPHQZLWKµ(&DW¶VHH7DEOH)RUPRQLWRULQJRI RIHDFKLQVWUXPHQWHGPRUWDUVSHFLPHQZLWKµ(&DW¶VHH7DEOH)RUPRQLWRULQJRI
WKHLQVWUXPHQWHGPRUWDUVSHFLPHQVZLWKRXWµ(&DW¶WKHFXUUHQWFKDQQHO  DQG WKHLQVWUXPHQWHGPRUWDUVSHFLPHQVZLWKRXWµ(&DW¶WKHFXUUHQWFKDQQHO  DQG
WKHµ(FRUU¶FKDQQHOVIRUWKHµ(&DW¶LHFKDQQHOV    DQG   WKHµ(FRUU¶FKDQQHOVIRUWKHµ(&DW¶LHFKDQQHOV    DQG  
DUHOHIWRXW)RUVLPSOHPRUWDUDQGFHPHQWSDVWHVSHFLPHQVWKHµ((:¶FKDQQHOVZHUH DUHOHIWRXW)RUVLPSOHPRUWDUDQGFHPHQWSDVWHVSHFLPHQVWKHµ((:¶FKDQQHOVZHUH
OHIWRXWLHFRQQHFWLRQVZHUHRQO\ HVWDEOLVKHGIRUFKDQQHOV    OHIWRXWLHFRQQHFWLRQVZHUHRQO\ HVWDEOLVKHGIRUFKDQQHOV   
     DQG    7KDW ZD\ WKH ((: FKDQQHOV ZHUH DYDLODEOH IRU      DQG    7KDW ZD\ WKH ((: FKDQQHOV ZHUH DYDLODEOH IRU
µ(FRUU¶ PRQLWRULQJ RI DGGLWLRQDO VSHFLPHQV HJ VSHFLPHQV ZLWK LQGLFHV HQGLQJ ZLWK µ(FRUU¶ PRQLWRULQJ RI DGGLWLRQDO VSHFLPHQV HJ VSHFLPHQV ZLWK LQGLFHV HQGLQJ ZLWK
³'´GXULQJµ7HVW,,¶ FI6HFWLRQ  ³'´GXULQJµ7HVW,,¶ FI6HFWLRQ 
7KH UHEDU WKH µ(&DW¶ DQG WKH VL[ µ((:V¶ ZHUH FRQQHFWHG WR WKH KLJK WHUPLQDOV RI 7KH UHEDU WKH µ(&DW¶ DQG WKH VL[ µ((:V¶ ZHUH FRQQHFWHG WR WKH KLJK WHUPLQDOV RI
FKDQQHOV  DQG  ZKLOHWKHILUVWDQGVHFRQGµ6&(¶ FKDQQHOV  DQG  ZKLOHWKHILUVWDQGVHFRQGµ6&(¶
ZHUHFRQQHFWHGWRWKHDVVRFLDWHGORZWHUPLQDOV)RUFKDQQHOV  WR   ZHUHFRQQHFWHGWRWKHDVVRFLDWHGORZWHUPLQDOV)RUFKDQQHOV  WR  
WKH UHEDU FRQGXFWRU ZDV FRQQHFWHG WR WKH ORZ WHUPLQDOV DQG WKH µ(&DW¶ DQG WKH VL[ WKH UHEDU FRQGXFWRU ZDV FRQQHFWHG WR WKH ORZ WHUPLQDOV DQG WKH µ(&DW¶ DQG WKH VL[
µ((:V¶ZHUHFRQQHFWHGWRWKHKLJKWHUPLQDOV µ((:V¶ZHUHFRQQHFWHGWRWKHKLJKWHUPLQDOV
7KHFXUUHQWIORZEHWZHHQWKHUHEDUDQGWKHFDWKRGHQHHGHGWREHWUDQVIHUUHGWRDYROW 7KHFXUUHQWIORZEHWZHHQWKHUHEDUDQGWKHFDWKRGHQHHGHGWREHWUDQVIHUUHGWRDYROW
DJH RXWSXW EHIRUH FRQQHFWLRQ WR WKH FRUUHVSRQGLQJ GDWDORJJHU WHUPLQDOV 7KH WUDQV DJH RXWSXW EHIRUH FRQQHFWLRQ WR WKH FRUUHVSRQGLQJ GDWDORJJHU WHUPLQDOV 7KH WUDQV
IRUPDWLRQZDVSHUIRUPHGE\WZRHOHFWULFDOO\VHSDUDWHGDPPHWHUVZKLFKZHUHGULYHQ IRUPDWLRQZDVSHUIRUPHGE\WZRHOHFWULFDOO\VHSDUDWHGDPPHWHUVZKLFKZHUHGULYHQ
E\WZRUHFKDUJHDEOH9EORFNEDWWHULHV7KHEDWWHULHVZHUH DXWRPDWLFDOO\ UHFKDUJHG E\WZRUHFKDUJHDEOH9EORFNEDWWHULHV7KHEDWWHULHVZHUH DXWRPDWLFDOO\ UHFKDUJHG
WRNHHSWKHVXSSO\YROWDJHDWDFRQVWDQWOHYHO5HFKDUJLQJZDVSHUIRUPHGDIWHUDQHQ WRNHHSWKHVXSSO\YROWDJHDWDFRQVWDQWOHYHO5HFKDUJLQJZDVSHUIRUPHGDIWHUDQHQ
WLUHEDWFKZDVPRQLWRUHGLHLQWKHWLPHIUDPHEHWZHHQWZRFRPSOHWHVFDQV&KDUJLQJ WLUHEDWFKZDVPRQLWRUHGLHLQWKHWLPHIUDPHEHWZHHQWZRFRPSOHWHVFDQV&KDUJLQJ
ZDV SHUIRUPHG E\ D VZLWFK XQLW FRQWUROOHG E\ WKH GLJLWDO µ,2¶ ERDUG FI 6HFWLRQ ZDV SHUIRUPHG E\ D VZLWFK XQLW FRQWUROOHG E\ WKH GLJLWDO µ,2¶ ERDUG FI 6HFWLRQ
 2SHUDWLRQRIWKHVZLWFKXQLWZDVEDVHGRQWKHVDPHSULQFLSOHDVWRJJOLQJRIWKH  2SHUDWLRQRIWKHVZLWFKXQLWZDVEDVHGRQWKHVDPHSULQFLSOHDVWRJJOLQJRIWKH
VZLWFKFDUG UHOD\V7KH FRQQHFWLRQVRIWKHWZR EDWWHU\SROHVZDVWRJJOHGEHWZHHQ D VZLWFK FDUG UHOD\V 7KH FRQQHFWLRQVRIWKHWZR EDWWHU\SROHVZDVWRJJOHGEHWZHHQ D
VWDQGDUG FKDUJLQJ XQLW DQG WKH YROWDJH VXSSO\ FRQQHFWLRQV RI WKH DPPHWHUV ,Q WKLV VWDQGDUG FKDUJLQJ XQLW DQG WKH YROWDJH VXSSO\ FRQQHFWLRQV RI WKH DPPHWHUV ,Q WKLV
ZD\WKHDPPHWHUVZHUHRSHUDWHGZLWKDVWDEOHVXSSO\YROWDJHWKDWZDVLQVXODWHGIURP ZD\WKHDPPHWHUVZHUHRSHUDWHGZLWKDVWDEOHVXSSO\YROWDJHWKDWZDVLQVXODWHGIURP
DQ\ SHUWXUEDWLRQ VRXUFHV 7KH DPPHWHUV SURYLGHG DQ H[DFW OLQHDU UHODWLRQ EHWZHHQ DQ\ SHUWXUEDWLRQ VRXUFHV 7KH DPPHWHUV SURYLGHG DQ H[DFW OLQHDU UHODWLRQ EHWZHHQ
YROWDJHRXWSXWDQGFXUUHQWLQSXWZLWKDWUDQVIRUPDWLRQIDFWRURI9P$7KHDPPH YROWDJHRXWSXWDQGFXUUHQWLQSXWZLWKDWUDQVIRUPDWLRQIDFWRURI9P$7KHDPPH
WHUVZHUHQXOOHGEDVHGRQWKHDSSOLHGVXSSO\YROWDJHDQG]HURFXUUHQWEHIRUHFRQQHF WHUVZHUHQXOOHGEDVHGRQWKHDSSOLHGVXSSO\YROWDJHDQG]HURFXUUHQWEHIRUHFRQQHF
WLRQWRUHEDUDQGµ(&DW¶ WLRQWRUHEDUDQGµ(&DW¶

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


0RQLWRULQJ6\VWHP 7HVW6HWXSDQG0HDVXULQJ0HWKRGV 0RQLWRULQJ6\VWHP 7HVW6HWXSDQG0HDVXULQJ0HWKRGV

7RHQVXUHSURSHUDGMXVWPHQWWRWKHFXUUHQWIORZRIWKHFRQQHFWHGVSHFLPHQDQGFDWK 7RHQVXUHSURSHUDGMXVWPHQWWRWKHFXUUHQWIORZRIWKHFRQQHFWHGVSHFLPHQDQGFDWK
RGHDQLQSXWRSWLRQIRUDGHOD\EHWZHHQVZLWFKLQJWRWKHDVVRFLDWHGFDUGDQGORJJLQJ RGHDQLQSXWRSWLRQIRUDGHOD\EHWZHHQVZLWFKLQJWRWKHDVVRFLDWHGFDUGDQGORJJLQJ
RIWKHDFWLYHFDUGZDVSURYLGHGLQWKHFRQWUROURXWLQH FI6HFWLRQ  RIWKHDFWLYHFDUGZDVSURYLGHGLQWKHFRQWUROURXWLQH FI6HFWLRQ 
$SSOLFDWLRQRIWKHFXUUHQWORJJLQJFKDQQHOVSURYLGHGRQWKHPXOWLSOH[HUFDUGVZDVQRW $SSOLFDWLRQRIWKHFXUUHQWORJJLQJFKDQQHOVSURYLGHGRQWKHPXOWLSOH[HUFDUGVZDVQRW
DGYLVDEOH IRU WKH PHDVXUHG FXUUHQW UDQJH  —$  DV UHVLVWLYLW\ DQG QRLVH ZHUH DGYLVDEOH IRU WKH PHDVXUHG FXUUHQW UDQJH  —$  DV UHVLVWLYLW\ DQG QRLVH ZHUH
YHU\ KLJK +RZHYHU WKH FRQQHFWLRQ WR WKH UHEDU DQG FDWKRGH FRQGXFWRUV FRXOG EH YHU\ KLJK +RZHYHU WKH FRQQHFWLRQ WR WKH UHEDU DQG FDWKRGH FRQGXFWRUV FRXOG EH
EULGJHGWRWKHFXUUHQWLQSXWWHUPLQDOVRIWKHPXOWLSOH[HUFDUGV7KLVRSWLRQZDVXVHG EULGJHGWRWKHFXUUHQWLQSXWWHUPLQDOVRIWKHPXOWLSOH[HUFDUGV7KLVRSWLRQZDVXVHG
IRUYHULILFDWLRQWKDWWKHDPPHWHUVZHUHIXQFWLRQLQJFRUUHFWO\ IRUYHULILFDWLRQWKDWWKHDPPHWHUVZHUHIXQFWLRQLQJFRUUHFWO\
(DFKRIWKHWZRH[SRVXUHFRQWDLQHUVZDVHTXLSSHGZLWKWZRLQGLYLGXDOµ6&(V¶7KH (DFKRIWKHWZRH[SRVXUHFRQWDLQHUVZDVHTXLSSHGZLWKWZRLQGLYLGXDOµ6&(V¶7KH
µ6&(¶VLJQDOVZHUHLQGHSHQGHQWRIWKHRXWSXWRIWKHVZLWFKFDUGV$FFRUGLQJO\LWZDV µ6&(¶VLJQDOVZHUHLQGHSHQGHQWRIWKHRXWSXWRIWKHVZLWFKFDUGV$FFRUGLQJO\LWZDV
QHFHVVDU\WRVZLWFKEHWZHHQWKHWZRVHWVRIWZRµ6&(V¶RIWKHVPDOODQGODUJH FRQ QHFHVVDU\WRVZLWFKEHWZHHQWKHWZRVHWVRIWZRµ6&(V¶RIWKHVPDOODQGODUJH FRQ
WDLQHU ZKHQ WKH DVVRFLDWHG VSHFLPHQV DQG FDWKRGHV ZHUH PRQLWRUHG 7KLV ZDV WDLQHU ZKHQ WKH DVVRFLDWHG VSHFLPHQV DQG FDWKRGHV ZHUH PRQLWRUHG 7KLV ZDV
DFKLHYHGE\DQµ6&(¶VZLWFKZKLFKZDVDOVRFRQWUROOHGE\WKHGLJLWDOµ,2¶ERDUG FI DFKLHYHGE\DQµ6&(¶VZLWFKZKLFKZDVDOVRFRQWUROOHGE\WKHGLJLWDOµ,2¶ERDUG FI
6HFWLRQ 7KHµ6&(¶VZLWFKZDVRSHUDWHGLQWKHVDPHZD\DVWKHFKDUJLQJVZLWFK 6HFWLRQ 7KHµ6&(¶VZLWFKZDVRSHUDWHGLQWKHVDPHZD\DVWKHFKDUJLQJVZLWFK
XQLW IRU WKH DPPHWHUV 7KH FRQQHFWLRQV RI WKH WZR µ6&(¶ LQSXWV RQ WKH GLVWULEXWLRQ XQLW IRU WKH DPPHWHUV 7KH FRQQHFWLRQV RI WKH WZR µ6&(¶ LQSXWV RQ WKH GLVWULEXWLRQ
WHUPLQDOZHUHWRJJOHGEHWZHHQWKHµ6&(V¶RIWKHVPDOOFRQWDLQHUDQGWKHµ6&(V¶RI WHUPLQDOZHUHWRJJOHGEHWZHHQWKHµ6&(V¶RIWKHVPDOOFRQWDLQHU DQG WKH µ6&(V¶RI
WKH ODUJH FRQWDLQHU $OO WKH RWKHU WHUPLQDO FRQQHFWLRQV RQ WKH GLVWULEXWLRQ WHUPLQDO WKH ODUJH FRQWDLQHU $OO WKH RWKHU WHUPLQDO FRQQHFWLRQV RQ WKH GLVWULEXWLRQ WHUPLQDO
ERDUGZHUHDVVRFLDWHGZLWKWKHRXWSXWIURPWKHDFWLYDWHGVZLWFKFDUG ERDUGZHUHDVVRFLDWHGZLWKWKHRXWSXWIURPWKHDFWLYDWHGVZLWFKFDUG
7KHGLJLWDOµ,2¶ERDUGZDVDOVRXVHGWRGHDFWLYDWHWKHDLUSXPSGXULQJPHDVXUHPHQWV 7KHGLJLWDOµ,2¶ERDUGZDVDOVRXVHGWRGHDFWLYDWHWKHDLUSXPSGXULQJPHDVXUHPHQWV
DV ZH FRQVLGHUHG WKDW VROXWLRQ WXUEXOHQFH FRXOG LQWHUIHUH ZLWK µ(FRUU¶ PHDVXUHPHQWV DV ZH FRQVLGHUHG WKDW VROXWLRQ WXUEXOHQFH FRXOG LQWHUIHUH ZLWK µ(FRUU¶ PHDVXUHPHQWV
7KLVZDVGRQHXVLQJD9VXSSO\YROWDJHLQWHUUXSWHUZKLFKZDVDOVRWULJJHUHGE\D 7KLVZDVGRQHXVLQJD9VXSSO\YROWDJHLQWHUUXSWHUZKLFKZDVDOVRWULJJHUHGE\D
VLJQDOIURPWKHGLJLWDOµ,2¶ERDUG7KHGHOD\LQDHUDWLRQGHDFWLYDWLRQEHIRUHDQGUHDF VLJQDOIURPWKHGLJLWDOµ,2¶ERDUG7KHGHOD\LQDHUDWLRQGHDFWLYDWLRQEHIRUHDQGUHDF
WLYDWLRQ DIWHU ORJJLQJ RI WKH PHDVXUHPHQW FOXVWHU FRXOG EH GHILQHG DUELWUDULO\ LQ WKH WLYDWLRQ DIWHU ORJJLQJ RI WKH PHDVXUHPHQW FOXVWHU FRXOG EH GHILQHG DUELWUDULO\ LQ WKH
FRQWUROURXWLQH FI6HFWLRQ  FRQWUROURXWLQH FI6HFWLRQ 
7KH UHPDLQLQJ FKDQQHOV  ZKLFK ZHUH QRW XVHG LQ WKH PHDVXUHPHQWFOXVWHUV 7KH UHPDLQLQJ FKDQQHOV  ZKLFK ZHUH QRW XVHG LQ WKH PHDVXUHPHQWFOXVWHUV
FRXOGEHXVHGIRUVXSSOHPHQWDU\PHDVXUHPHQWV 7KHGDWDORJJHUZDVSURJUDPPHGWR FRXOGEHXVHGIRUVXSSOHPHQWDU\PHDVXUHPHQWV 7KHGDWDORJJHUZDVSURJUDPPHGWR
VFDQWKHVHFKDQQHOVRQO\RQFHDIWHUDOOPHDVXUHPHQWFOXVWHUVKDGEHHQUHFRUGHGLHDW VFDQWKHVHFKDQQHOVRQO\RQFHDIWHUDOOPHDVXUHPHQWFOXVWHUVKDGEHHQUHFRUGHGLHDW
WKHHQGRIVFDQRIWKHHQWLUHEDWFK&KDQQHOVZHUHXVHGIRURQOLQHYHULILFDWLRQ WKHHQGRIVFDQRIWKHHQWLUHEDWFK&KDQQHOVZHUHXVHGIRURQOLQHYHULILFDWLRQ
RIWKHIRXULQVWDOOHGµ6&(V¶DQGLQFRQQHFWLRQZLWKWKHH[WUDKROHVIRUVXSSOHPHQWDU\ RIWKHIRXULQVWDOOHGµ6&(V¶DQGLQFRQQHFWLRQZLWKWKHH[WUDKROHVIRUVXSSOHPHQWDU\
PHDVXUHPHQWV HJ IRU TXDQWLILFDWLRQ RI WKH HIIHFW RI WKH GLVWDQFH RI WKH UHIHUHQFH PHDVXUHPHQWV HJ IRU TXDQWLILFDWLRQ RI WKH HIIHFW RI WKH GLVWDQFH RI WKH UHIHUHQFH
HOHFWURGHV RQ PHDVXUHPHQWV RU LQ UHODWLRQ WR VROXWLRQ UHVLVWDQFH  7KH SHUPDQHQWO\ HOHFWURGHV RQ PHDVXUHPHQWV RU LQ UHODWLRQ WR VROXWLRQ UHVLVWDQFH  7KH SHUPDQHQWO\
LQVWDOOHGµ6&(V¶ZHUHFRQQHFWHGWRWKHKLJKWHUPLQDOVDQGPHDVXUHGDJDLQVWWKHDGGL LQVWDOOHGµ6&(V¶ZHUHFRQQHFWHGWRWKHKLJKWHUPLQDOVDQGPHDVXUHGDJDLQVWWKHDGGL
WLRQDOHOHFWURGHVLQWKHDVVRFLDWHGH[SRVXUHFRQWDLQHUFRQQHFWHGWRWKHORZWHUPLQDO WLRQDOHOHFWURGHVLQWKHDVVRFLDWHGH[SRVXUHFRQWDLQHUFRQQHFWHGWRWKHORZWHUPLQDO
&KDQQHOV  ZHUH SURYLGHG IRU VXSSOHPHQWDU\ PHDVXUHPHQWV ZLWK RWKHU HOHF &KDQQHOV  ZHUH SURYLGHG IRU VXSSOHPHQWDU\ PHDVXUHPHQWV ZLWK RWKHU HOHF
WURGHW\SHVHJLRQVHOHFWLYHFKORULGHRUS+HOHFWURGHV&KDQQHOVDQGZHUH WURGHW\SHVHJLRQVHOHFWLYHFKORULGHRUS+HOHFWURGHV&KDQQHOVDQGZHUH
FRQILJXUHGIRUKLJKHUYROWDJHUDQJHVDQGXVHGWRPRQLWRUWKHYROWDJHRIWKHUHFKDUJH FRQILJXUHGIRUKLJKHUYROWDJHUDQJHVDQGXVHGWRPRQLWRUWKHYROWDJHRIWKHUHFKDUJH
DEOHEDWWHULHVZKHQGLVFRQQHFWHGIURPWKHFKDUJLQJXQLW&KDQQHOVZHUHFRQ DEOHEDWWHULHVZKHQGLVFRQQHFWHGIURPWKHFKDUJLQJXQLW&KDQQHOVZHUHFRQ
ILJXUHGIRUWHPSHUDWXUHLQSXWDQGHTXLSSHGZLWKWKHUPRFRXSOHZLUHV8QOLNHDOORWKHU ILJXUHGIRUWHPSHUDWXUHLQSXWDQGHTXLSSHGZLWKWKHUPRFRXSOHZLUHV8QOLNHDOORWKHU
FRQGXFWRUV XVHG IRU GDWDORJJLQJ WKH WKHUPRFRXSOH ZLUHV ZHUH QRW FRQQHFWHG WR WKH FRQGXFWRUV XVHG IRU GDWDORJJLQJ WKH WKHUPRFRXSOH ZLUHV ZHUH QRW FRQQHFWHG WR WKH
GLVWULEXWLRQWHUPLQDOERDUGEXWGLUHFWO\WRWKHDVVRFLDWHGPXOWLSOH[HUFDUGWHUPLQDOV GLVWULEXWLRQWHUPLQDOERDUGEXWGLUHFWO\WRWKHDVVRFLDWHGPXOWLSOH[HUFDUGWHUPLQDOV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7HVW6HWXSDQG0HDVXULQJ0HWKRGV ,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV ,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV

7KHWKHUPRFRXSOHVZHUHXVHGWRPHDVXUHWKHVROXWLRQWHPSHUDWXUHLQERWKFRQWDLQHUV 7KHWKHUPRFRXSOHVZHUHXVHGWRPHDVXUHWKHVROXWLRQWHPSHUDWXUHLQERWKFRQWDLQHUV
DVZHOODVWKHDPELHQWDLUWHPSHUDWXUH DVZHOODVWKHDPELHQWDLUWHPSHUDWXUH

 &RQWURO5RXWLQH  &RQWURO5RXWLQH


7KHGLJLWDOµ,2¶ERDUGDQGWKHGDWDORJJHUZHUHFRQWUROOHGE\D/DE9,(:>1,@ 7KHGLJLWDOµ,2¶ERDUGDQGWKHGDWDORJJHUZHUHFRQWUROOHGE\D/DE9,(:>1,@
URXWLQH 7KH VSHFLPHQV WR EH PRQLWRUHG LH WKH FOXVWHUV WR EH ORJJHG  FRXOG EH VH URXWLQH 7KH VSHFLPHQV WR EH PRQLWRUHG LH WKH FOXVWHUV WR EH ORJJHG  FRXOG EH VH
OHFWHGLQFRQQHFWLRQZLWKWKHDVVRFLDWHGH[SRVXUHFRQWDLQHU7KLVVHOHFWLRQFRQWUROOHG OHFWHGLQFRQQHFWLRQZLWKWKHDVVRFLDWHGH[SRVXUHFRQWDLQHU7KLVVHOHFWLRQFRQWUROOHG
VZLWFKLQJEHWZHHQWKHFDUGVDQGWKHµ6&(¶VZLWFKUHVSHFWLYHO\7KHWLPHIUDPHEH VZLWFKLQJEHWZHHQWKHFDUGVDQGWKHµ6&(¶VZLWFKUHVSHFWLYHO\7KHWLPHIUDPHEH
WZHHQORJJLQJRIWKHHQWLUHEDWFKDQGEHWZHHQORJJLQJRILQGLYLGXDOFOXVWHUVFRXOGEH WZHHQORJJLQJRIWKHHQWLUHEDWFKDQGEHWZHHQORJJLQJRILQGLYLGXDOFOXVWHUVFRXOGEH
VSHFLILHGDVUHTXLUHG&KDUJLQJRIWKHEDWWHULHVZDVWULJJHUHGDXWRPDWLFDOO\DIWHUHDFK VSHFLILHGDVUHTXLUHG&KDUJLQJRIWKHEDWWHULHVZDVWULJJHUHGDXWRPDWLFDOO\DIWHUHDFK
HQWLUH EDWFK KDG EHHQ ORJJHG 0RUHRYHU WKH GHOD\ EHWZHHQ VZLWFKLQJ WR D FDUG DQG HQWLUH EDWFK KDG EHHQ ORJJHG 0RUHRYHU WKH GHOD\ EHWZHHQ VZLWFKLQJ WR D FDUG DQG
ORJJLQJRIWKHDVVRFLDWHGFOXVWHUFRXOGEHGHILQHGDUELWUDULO\DVFRXOGWKHGHDFWLYDWLRQ ORJJLQJRIWKHDVVRFLDWHGFOXVWHUFRXOGEHGHILQHGDUELWUDULO\DVFRXOGWKHGHDFWLYDWLRQ
RIWKHDLUSXPSZKLFKWRJJOHGWKH9VXSSO\YROWDJHLQWHUUXSWHU RIWKHDLUSXPSZKLFKWRJJOHGWKH9VXSSO\YROWDJHLQWHUUXSWHU
7KH /DE9,(: URXWLQH FUHDWHG DQ LQGLYLGXDO WH[W ILOH IRU WKH VHOHFWHGVSHFLPHQVDQG 7KH /DE9,(: URXWLQH FUHDWHG DQ LQGLYLGXDO WH[W ILOH IRU WKH VHOHFWHGVSHFLPHQVDQG
IRUWKHH[WUDFKDQQHOV7KHWH[WILOHIRUDVSHFLPHQFRPSULVHGWDEVHSDUDWHGFROXPQV IRUWKHH[WUDFKDQQHOV7KHWH[WILOHIRUDVSHFLPHQFRPSULVHGWDEVHSDUDWHGFROXPQV
ZLWKDWLPHVWDPSFROXPQDQGGDWDFROXPQVZLWKDKHDGHUDFFRUGLQJWRWKHPHDV ZLWKDWLPHVWDPSFROXPQDQGGDWDFROXPQVZLWKDKHDGHUDFFRUGLQJWRWKHPHDV
XUHPHQW LQGLFHV VHH 7DEOH  2QFH D PHDVXUHPHQW FOXVWHU KDG EHHQ ORJJHG WKH XUHPHQW LQGLFHV VHH 7DEOH  2QFH D PHDVXUHPHQW FOXVWHU KDG EHHQ ORJJHG WKH
PHDVXUHGGDWDZDVVDYHGLQWRDQHZURZRIWKHWH[WILOHVRIWKHDVVRFLDWHGWZRVSHFL PHDVXUHGGDWDZDVVDYHGLQWRDQHZURZRIWKHWH[WILOHVRIWKHDVVRFLDWHGWZRVSHFL
PHQV7KHURXWLQHDOVRSURYLGHGDQRQOLQHEURZVHU7KHEURZVHUDOORZHGPRQLWRULQJ PHQV7KHURXWLQHDOVRSURYLGHGDQRQOLQHEURZVHU7KHEURZVHUDOORZHGPRQLWRULQJ
RIVHOHFWHGFKDQQHOVIURPRQHVHOHFWHGVSHFLPHQRUIURPWKHH[WUDFKDQQHOV7KHGDWD RIVHOHFWHGFKDQQHOVIURPRQHVHOHFWHGVSHFLPHQRUIURPWKHH[WUDFKDQQHOV7KHGDWD
ZDVUHDGIURPWKHDVVRFLDWHGWH[WILOHVDQGXSGDWHGRQFHDQHZPHDVXUHPHQWFOXVWHU ZDVUHDGIURPWKHDVVRFLDWHGWH[WILOHVDQGXSGDWHGRQFHDQHZPHDVXUHPHQWFOXVWHU
KDGEHHQORJJHG KDGEHHQORJJHG
7KHPRGXODUOD\RXWRIWKHPRQLWRULQJV\VWHPPHDQWWKDWH[WHQVLRQRIWKHPRQLWRULQJ 7KHPRGXODUOD\RXWRIWKHPRQLWRULQJV\VWHPPHDQWWKDWH[WHQVLRQRIWKHPRQLWRULQJ
FDSDFLW\RQO\UHTXLUHGWKHFRQQHFWLRQRIIXUWKHUVZLWFKFDUGV$GGLWLRQDOVZLWFKFDUGV FDSDFLW\RQO\UHTXLUHGWKHFRQQHFWLRQRIIXUWKHUVZLWFKFDUGV$GGLWLRQDOVZLWFKFDUGV
FRXOG EH FRQYHQLHQWO\ GDLV\FKDLQHG DQG FRQQHFWHG WR WKH H[WHQVLRQ SOXJ RI WKH FRXOG EH FRQYHQLHQWO\ GDLV\FKDLQHG DQG FRQQHFWHG WR WKH H[WHQVLRQ SOXJ RI WKH
VZLWFKFDUGFDEOHDQGHTXLSSHGZLWKWULJJHUVLJQDOFRQQHFWLRQVWRWKHDYDLODEOHGLJLWDO VZLWFKFDUGFDEOHDQGHTXLSSHGZLWKWULJJHUVLJQDOFRQQHFWLRQVWRWKHDYDLODEOHGLJLWDO
µ,2¶ERDUGFKDQQHOV$GGLWLRQDOPHDVXUHPHQWFOXVWHUV LHIXUWKHUVSHFLPHQV FRXOG µ,2¶ERDUGFKDQQHOV$GGLWLRQDOPHDVXUHPHQWFOXVWHUV LHIXUWKHUVSHFLPHQV FRXOG
EHHIIRUWOHVVO\LPSOHPHQWHGLQWKHFRQWUROURXWLQH EHHIIRUWOHVVO\LPSOHPHQWHGLQWKHFRQWUROURXWLQH

 ,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV  ,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV


,Q WKLV 6HFWLRQ WKH LPSOHPHQWDWLRQ RI WKH PHDVXUHPHQWV WHFKQLTXHV ZKLFK ZH FRQ ,Q WKLV 6HFWLRQ WKH LPSOHPHQWDWLRQ RI WKH PHDVXUHPHQWV WHFKQLTXHV ZKLFK ZH FRQ
VLGHU WR EH HVVHQWLDO LQ WHVWLQJ RI WKH WKHUPRG\QDPLF SHUIRUPDQFH RI DYDLODEOH DQG VLGHU WR EH HVVHQWLDO LQ WHVWLQJ RI WKH WKHUPRG\QDPLF SHUIRUPDQFH RI DYDLODEOH DQG
QHZFRXQWHUPHDVXUHV FI6HFWLRQ LQWKHH[SHULPHQWDOVHWXSLVGHVFULEHG(PSKD QHZFRXQWHUPHDVXUHV FI6HFWLRQ LQWKHH[SHULPHQWDOVHWXSLVGHVFULEHG(PSKD
VLVLVVHWRQHOHFWURFKHPLFDOWHFKQLTXHV FI6HFWLRQ ZKLOHWKHDSSOLFDWLRQRIWKH VLVLVVHWRQHOHFWURFKHPLFDOWHFKQLTXHV FI6HFWLRQ ZKLOHWKHDSSOLFDWLRQRIWKH
H[SRVXUHVHWXSDQGYDULDWLRQVRIWKHPRUWDUVSHFLPHQVLQUHODWLRQWRDGGLWLRQDOPHDV H[SRVXUHVHWXSDQGYDULDWLRQVRIWKHPRUWDUVSHFLPHQVLQUHODWLRQWRDGGLWLRQDOPHDV
XUHPHQWWHFKQLTXHVLVGHDOWZLWKUDWKHUEULHIO\ FI6HFWLRQ  XUHPHQWWHFKQLTXHVLVGHDOWZLWKUDWKHUEULHIO\ FI6HFWLRQ 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV ,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV

 (OHFWURFKHPLFDO7HFKQLTXHV  (OHFWURFKHPLFDO7HFKQLTXHV


,QWKLV6HFWLRQWKHPRVWLPSRUWDQWIHDWXUHVFRQFHUQLQJWKHLPSOHPHQWDWLRQRIWKHUH ,QWKLV6HFWLRQWKHPRVWLPSRUWDQWIHDWXUHVFRQFHUQLQJWKHLPSOHPHQWDWLRQRIWKHUH
TXLUHG HOHFWURFKHPLFDO PHDVXUHPHQWV VWDWHG LQ 6HFWLRQ  LQWR WKH H[SHULPHQWDO TXLUHG HOHFWURFKHPLFDO PHDVXUHPHQWV VWDWHG LQ 6HFWLRQ  LQWR WKH H[SHULPHQWDO
VHWXSDUHGHVFULEHG,PSOHPHQWDWLRQRIµ(FRUU¶PRQLWRULQJµLPDF¶PRQLWRULQJµ(,6¶DQG VHWXSDUHGHVFULEHG,PSOHPHQWDWLRQRIµ(FRUU¶PRQLWRULQJµLPDF¶PRQLWRULQJµ(,6¶DQG
SRODULVDWLRQFXUYHPHDVXUHPHQWVLVGHVFULEHGLQ6HFWLRQVDQG SRODULVDWLRQFXUYHPHDVXUHPHQWVLVGHVFULEHGLQ6HFWLRQVDQG
UHVSHFWLYHO\ UHVSHFWLYHO\

 &RUURVLRQ3RWHQWLDO0RQLWRULQJ  &RUURVLRQ3RWHQWLDO0RQLWRULQJ


7KH µ(FRUU¶ RI WKH UHEDU DQG µ(&DW¶ ZHUH PRQLWRUHG DJDLQVW WKH WZR H[WHUQDO µ6&(V¶ 7KH µ(FRUU¶ RI WKH UHEDU DQG µ(&DW¶ ZHUH PRQLWRUHG DJDLQVW WKH WZR H[WHUQDO µ6&(V¶
DQGDJDLQVWWKHµ((:V¶GXULQJERWKDFWLYDWLRQDQGGHDFWLYDWLRQRIWKHPDFURFHOO FI DQGDJDLQVWWKHµ((:V¶GXULQJERWKDFWLYDWLRQDQGGHDFWLYDWLRQRIWKHPDFURFHOO FI
7DEOHLQ6HFWLRQ %ULGJLQJRIWKHFRQGXFWRUVWREHPHDVXUHGHYHQWKHµLPDF¶ 7DEOHLQ6HFWLRQ %ULGJLQJRIWKHFRQGXFWRUVWREHPHDVXUHGHYHQWKHµLPDF¶
FRQGXFWRUV RYHU PRUH WKDQ RQH FKDQQHO GLG QRW FDXVH LQWHUIHUHQFH VLQFH WKH PXOWL FRQGXFWRUV RYHU PRUH WKDQ RQH FKDQQHO GLG QRW FDXVH LQWHUIHUHQFH VLQFH WKH PXOWL
SOH[HU FKDQQHOV ZHUH HOHFWULFDOO\ VHSDUDWHG DQG PHDVXUHG RQH DIWHU WKH RWKHU 7KH SOH[HU FKDQQHOV ZHUH HOHFWULFDOO\ VHSDUDWHG DQG PHDVXUHG RQH DIWHU WKH RWKHU 7KH
PDLQSXUSRVHRIWKHµ((:V¶ZDVWRDFWDVµ(,6¶HOHFWURGHVEXWWKH\DOVRKDGEHQHIL PDLQSXUSRVHRIWKHµ((:V¶ZDVWRDFWDVµ(,6¶HOHFWURGHVEXWWKH\DOVRKDGEHQHIL
FLDODSSOLFDWLRQLQWKHPRQLWRULQJRIµ(FRUU¶)LUVWO\WKH\PDGHLWSRVVLEOHWRPRQLWRU FLDODSSOLFDWLRQLQWKHPRQLWRULQJRIµ(FRUU¶)LUVWO\WKH\PDGHLWSRVVLEOHWRPRQLWRU
WKHUHEDULQWZRGLUHFWLRQVLHIURPWKHRXWVLGHLQZDUGVDQGIURPWKHLQVLGHRXWZDUGV WKHUHEDULQWZRGLUHFWLRQVLHIURPWKHRXWVLGHLQZDUGVDQGIURPWKHLQVLGHRXWZDUGV
)URP WKH RXWVLGH LQZDUGV FRUUHVSRQGHG WR PRQLWRULQJ WKH UHEDU DJDLQVW WKH WZR )URP WKH RXWVLGH LQZDUGV FRUUHVSRQGHG WR PRQLWRULQJ WKH UHEDU DJDLQVW WKH WZR
µ6&(V¶ ZKHUHDV IURP WKH LQVLGH RXWZDUGV UHSUHVHQWHG PRQLWRULQJ RI WKH µ((:V¶ µ6&(V¶ ZKHUHDV IURP WKH LQVLGH RXWZDUGV UHSUHVHQWHG PRQLWRULQJ RI WKH µ((:V¶
DJDLQVWWKHUHEDUDQGDJDLQVWWKHWZRµ6&(V¶%DVHGRQWKLVLQIRUPDWLRQDQDOJRULWKP DJDLQVWWKHUHEDUDQGDJDLQVWWKHWZRµ6&(V¶%DVHGRQWKLVLQIRUPDWLRQDQDOJRULWKP
ZDVXVHGWRDGMXVWWKHµ(FRUU¶PHDVXUHPHQWRIWKHUHEDU,QWKLVZD\DOOµ(FRUU¶GHYLD ZDVXVHGWRDGMXVWWKHµ(FRUU¶PHDVXUHPHQWRIWKHUHEDU,QWKLVZD\DOOµ(FRUU¶GHYLD
WLRQVUHVXOWLQJIURPHJVROXWLRQDQGPRUWDUUHVLVWLYLW\RUVXUIDFHDQGGLVWDQFHHIIHFWV WLRQVUHVXOWLQJIURPHJVROXWLRQDQGPRUWDUUHVLVWLYLW\RUVXUIDFHDQGGLVWDQFHHIIHFWV
FRXOGEHHOLPLQDWHG7KHDOJRULWKPDOVRWRRNLQWRDFFRXQWWKHµ(&DW¶DQGµ(FRUU¶PHDV FRXOGEHHOLPLQDWHG7KHDOJRULWKPDOVRWRRNLQWRDFFRXQWWKHµ(&DW¶DQGµ(FRUU¶PHDV
XUHGDJDLQVWWKHµ6&(V¶DQGWKHUHEDU7KHLQGLYLGXDOSRWHQWLDOVRIWKHµ((:V¶DQGRI XUHGDJDLQVWWKHµ6&(V¶DQGWKHUHEDU7KHLQGLYLGXDOSRWHQWLDOVRIWKHµ((:V¶DQGRI
WKH µ(&DW¶ RU µ(FRUU¶ VKLIWV GLG QRW DIIHFW WKH DOJRULWKP EHFDXVH WKHVH UHDGLQJV DS WKH µ(&DW¶ RU µ(FRUU¶ VKLIWV GLG QRW DIIHFW WKH DOJRULWKP EHFDXVH WKHVH UHDGLQJV DS
SHDUHGLQERWKPHDVXUHPHQWGLUHFWLRQVDQGFDQFHOOHGHDFKRWKHURXW)RULQVWDQFHWKH SHDUHGLQERWKPHDVXUHPHQWGLUHFWLRQVDQGFDQFHOOHGHDFKRWKHURXW)RULQVWDQFHWKH
RXWHUFLUFOHRI HOHFWURGH ZLUHVZDVSRODULVHGGXULQJ µ(,6¶DQGH[SHULHQFHGDQµ(FRUU¶ RXWHUFLUFOHRI HOHFWURGH ZLUHVZDVSRODULVHGGXULQJ µ(,6¶DQGH[SHULHQFHGDQµ(FRUU¶
VKLIWWKLVVKLIWZDVPHDVXUHGDJDLQVWERWKWKHUHEDUDQGWKHµ6&(¶DQGZDVWKHUHIRUH VKLIWWKLVVKLIWZDVPHDVXUHGDJDLQVWERWKWKHUHEDUDQGWKHµ6&(¶DQGZDVWKHUHIRUH
FDQFHOOHG RXW LQ WKH DOJRULWKP 7KXV WKH DOJRULWKP EDVHG RQ ELGLUHFWLRQDO PHDVXUH FDQFHOOHG RXW LQ WKH DOJRULWKP 7KXV WKH DOJRULWKP EDVHG RQ ELGLUHFWLRQDO PHDVXUH
PHQWDQGLQSXWGDWDIURPSRWHQWLDOUHDGLQJVDOORZHGDSSURSULDWHFRUUHFWLRQRIWKH PHQWDQGLQSXWGDWDIURPSRWHQWLDOUHDGLQJVDOORZHGDSSURSULDWHFRUUHFWLRQRIWKH
µ(FRUU¶GDWDDQGPDQ\GHEXJJLQJRSWLRQVZHUHPDGHDYDLODEOH µ(FRUU¶GDWDDQGPDQ\GHEXJJLQJRSWLRQVZHUHPDGHDYDLODEOH
,QDFFXUDFLHVLQWUDQVIHUULQJWKHSRWHQWLDOYDOXHVIURPWKHµ6&(¶VFDOHWRWKHVWDQGDUG ,QDFFXUDFLHVLQWUDQVIHUULQJWKHSRWHQWLDOYDOXHVIURPWKHµ6&(¶VFDOHWRWKHVWDQGDUG
K\GURJHQ HOHFWURGH µ6+(¶ VFDOH ZHUH PLQLPLVHG E\ PHDVXULQJ DJDLQVW WZR µ6&(V¶ K\GURJHQ HOHFWURGH µ6+(¶ VFDOH ZHUH PLQLPLVHG E\ PHDVXULQJ DJDLQVW WZR µ6&(V¶
5HDGLQJV IURP WKH WZR µ6&(V¶ ZHUH FRPSDUHG WR HDFK RWKHU DV ZHOO DV WR WKH H[WUD 5HDGLQJV IURP WKH WZR µ6&(V¶ ZHUH FRPSDUHG WR HDFK RWKHU DV ZHOO DV WR WKH H[WUD
HOHFWURGHVGXULQJPRQLWRULQJ7KHµ6&(V¶ZHUHPDLQWDLQHGRQDZHHNO\EDVLV0DLQ HOHFWURGHVGXULQJPRQLWRULQJ7KHµ6&(V¶ZHUHPDLQWDLQHGRQDZHHNO\EDVLV0DLQ
WHQDQFH LQFOXGHG UHILOOLQJ ZLWK VDWXUDWHG .&O VROXWLRQ DQG .&O FU\VWDOV DV ZHOO DV WHQDQFH LQFOXGHG UHILOOLQJ ZLWK VDWXUDWHG .&O VROXWLRQ DQG .&O FU\VWDOV DV ZHOO DV
FDOLEUDWLRQ DJDLQVW DQ $J$J&O UHIHUHQFH HOHFWURGH LQ D S+ EXIIHUHG VROXWLRQ $O FDOLEUDWLRQ DJDLQVW DQ $J$J&O UHIHUHQFH HOHFWURGH LQ D S+ EXIIHUHG VROXWLRQ $O
WKRXJKWKHDERYHGHVFULEHGDOJRULWKPFRXOGDOVREHXVHGWRFRPSHQVDWHIRUYDULDWLRQV WKRXJKWKHDERYHGHVFULEHGDOJRULWKPFRXOGDOVREHXVHGWRFRPSHQVDWHIRUYDULDWLRQV
RIµ(¶RIWKHµ6&(V¶ FI6HFWLRQ WKLVIXQFWLRQZDVGLVDEOHG 'XHWRWKHIUH RIµ(¶RIWKHµ6&(V¶ FI6HFWLRQ WKLVIXQFWLRQZDVGLVDEOHG 'XHWRWKHIUH
TXHQWPDLQWHQDQFHDQGWKHUHODWLYHO\FRQVWDQWWHPSHUDWXUHRIWKHH[SRVXUHVROXWLRQV TXHQWPDLQWHQDQFHDQGWKHUHODWLYHO\FRQVWDQWWHPSHUDWXUHRIWKHH[SRVXUHVROXWLRQV
WKHµ6&(¶UHDGLQJVZHUHGHWHUPLQHGWREHTXLWHVWDEOH WKHµ6&(¶UHDGLQJVZHUHGHWHUPLQHGWREHTXLWHVWDEOH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7HVW6HWXSDQG0HDVXULQJ0HWKRGV ,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV ,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV

0RQLWRULQJRIWKHUHEDUSRWHQWLDOUHODWLYHWRWKHLQQHUFLUFOHRIHOHFWURGHZLUHVZKLFK 0RQLWRULQJRIWKHUHEDUSRWHQWLDOUHODWLYHWRWKHLQQHUFLUFOHRIHOHFWURGHZLUHVZKLFK
ZHUH QRW SHUWXUEHG E\ µ(,6¶ ZDV D IHDVLEOH DQG FRQYHQLHQW PHWKRG IRU FRQWLQXRXV ZHUH QRW SHUWXUEHG E\ µ(,6¶ ZDV D IHDVLEOH DQG FRQYHQLHQW PHWKRG IRU FRQWLQXRXV
PRQLWRULQJ ZLWKRXW H[WHUQDO HOHFWURGHV HJ LPPHGLDWHO\ DIWHU SUHSDUDWLRQ RU GXULQJ PRQLWRULQJ ZLWKRXW H[WHUQDO HOHFWURGHV HJ LPPHGLDWHO\ DIWHU SUHSDUDWLRQ RU GXULQJ
QRQVXEPHUVLRQ SHULRGV +RZHYHU GXH WR WKH FKDQJHV LQ R[\JHQ FRQWHQW LQ WKH QRQVXEPHUVLRQ SHULRGV +RZHYHU GXH WR WKH FKDQJHV LQ R[\JHQ FRQWHQW LQ WKH
VSHFLPHQ FI6HFWLRQ IUHTXHQWFDOLEUDWLRQRIWKHµ(FRUU¶RIWKHHOHFWURGHZLUHV VSHFLPHQ FI6HFWLRQ IUHTXHQWFDOLEUDWLRQRIWKHµ(FRUU¶RIWKHHOHFWURGHZLUHV
DJDLQVWDQH[WHUQDOUHIHUHQFHHOHFWURGHZDVFUXFLDOHJE\XVLQJDVXUIDFHHOHFWURGH DJDLQVWDQH[WHUQDOUHIHUHQFHHOHFWURGHZDVFUXFLDOHJE\XVLQJDVXUIDFHHOHFWURGH
6XFKHOHFWURGHV FRXOGEHFRQQHFWHGWRWKHWHUPLQDOVIRUDGGLWLRQDOHOHFWURGHVRQWKH 6XFKHOHFWURGHV FRXOGEHFRQQHFWHGWRWKHWHUPLQDOVIRUDGGLWLRQDOHOHFWURGHVRQWKH
GLVWULEXWLRQ WHUPLQDOERDUG ZKLFK ZHUH DXWRPDWLFDOO\ ORJJHG DWWKHHQGRIHDFKIXOO GLVWULEXWLRQ WHUPLQDOERDUG ZKLFK ZHUH DXWRPDWLFDOO\ ORJJHG DWWKHHQGRIHDFKIXOO
VFDQ &DOLEUDWLRQ FRXOG EH EDVHG RQ D OLPLWHG QXPEHU RI UHSUHVHQWDWLYH VSHFLPHQV VFDQ &DOLEUDWLRQ FRXOG EH EDVHG RQ D OLPLWHG QXPEHU RI UHSUHVHQWDWLYH VSHFLPHQV
EHFDXVHµ(FRUU¶RIWKHµ((:V¶KDGEHHQREVHUYHGWREHZLWKLQDYHU\FORVHUDQJHIRU EHFDXVHµ(FRUU¶RIWKHµ((:V¶KDGEHHQREVHUYHGWREHZLWKLQDYHU\FORVHUDQJHIRU
VSHFLPHQVZLWKWKHVDPHPRUWDUFRPSRVLWLRQDQGDJHXQGHULGHQWLFDOH[SRVXUHFRQGL VSHFLPHQVZLWKWKHVDPHPRUWDUFRPSRVLWLRQDQGDJHXQGHULGHQWLFDOH[SRVXUHFRQGL
WLRQV>.WHUHWDOE@ WLRQV>.WHUHWDOE@
7KHR[\JHQDQGS+VHQVLWLYLW\RIWKHDFWLYDWHG7LZLUHFRXOGDOVREHXVHGIRUDVVHVV 7KHR[\JHQDQGS+VHQVLWLYLW\RIWKHDFWLYDWHG7LZLUHFRXOGDOVREHXVHGIRUDVVHVV
PHQWRIFKDQJHVLQWKHR[\JHQFRQWHQWDQGS+LQWKHYLFLQLW\RIWKHUHEDUZKLOHWKH PHQWRIFKDQJHVLQWKHR[\JHQFRQWHQWDQGS+LQWKHYLFLQLW\RIWKHUHEDUZKLOHWKH
VSHFLPHQVZHUHVXEPHUJHG6XFKFKDQJHVZHUHLQGLFDWHGE\YDULDWLRQVLQWKHSRWHQ VSHFLPHQVZHUHVXEPHUJHG6XFKFKDQJHVZHUHLQGLFDWHGE\YDULDWLRQVLQWKHSRWHQ
WLDORIWKHLQQHUFLUFOHRIHOHFWURGHZLUHVDJDLQVWWKHµ6&(V¶>.WHUHWDOE@ WLDORIWKHLQQHUFLUFOHRIHOHFWURGHZLUHVDJDLQVWWKHµ6&(V¶>.WHUHWDOE@
,I FDUERQ VWHHO ZLUH ZDV XVHG LQVWHDG RI DFWLYDWHG 7L ZLUH IRU WKH µ((:V¶ LQ WKH LQ ,I FDUERQ VWHHO ZLUH ZDV XVHG LQVWHDG RI DFWLYDWHG 7L ZLUH IRU WKH µ((:V¶LQWKHLQ
VWUXPHQWHGPRUWDUVSHFLPHQVWKHGHILQHGSRVLWLRQVDQGFRQVWDQWGLVWDQFHV FI)LJXUH VWUXPHQWHGPRUWDUVSHFLPHQVWKHGHILQHGSRVLWLRQVDQGFRQVWDQWGLVWDQFHV FI)LJXUH
>%@LQ6HFWLRQ DOORZHGIRUFRQYHQLHQWQRQGHVWUXFWLYHPRQLWRULQJRIFKOR >%@LQ6HFWLRQ DOORZHGIRUFRQYHQLHQWQRQGHVWUXFWLYHPRQLWRULQJRIFKOR
ULGHLQJUHVV7KHPRQLWRULQJSULQFLSOHZDVLGHQWLFDOWRWKHRQHIRUWKHUHEDUSRWHQWLDO ULGHLQJUHVV7KHPRQLWRULQJSULQFLSOHZDVLGHQWLFDOWRWKHRQHIRUWKHUHEDUSRWHQWLDO
PRQLWRULQJ $ SRWHQWLDO GURS LQ WKH VWHHO ZLUH PRQLWRUHG DJDLQVW WKH µ6&(V¶ RU WKH PRQLWRULQJ $ SRWHQWLDO GURS LQ WKH VWHHO ZLUH PRQLWRUHG DJDLQVW WKH µ6&(V¶ RU WKH
SDVVLYHUHEDULQGLFDWHGFRUURVLRQLQLWLDWLRQ,QWKLVZD\WKHFKORULGHLQJUHVVUDWHFRXOG SDVVLYHUHEDULQGLFDWHGFRUURVLRQLQLWLDWLRQ,QWKLVZD\WKHFKORULGHLQJUHVVUDWHFRXOG
EHDVVHVVHGQRQGHVWUXFWLYHO\DQGXQGHUH[DFWO\WKHVDPHH[SRVXUHFRQGLWLRQVDVIRU EHDVVHVVHGQRQGHVWUXFWLYHO\DQGXQGHUH[DFWO\WKHVDPHH[SRVXUHFRQGLWLRQVDVIRU
WKHWHVWVSHFLPHQV)XUWKHUPRUHFRQFOXVLYHLQIRUPDWLRQRQWKHEXONKRPRJHQHLW\RI WKHWHVWVSHFLPHQV)XUWKHUPRUHFRQFOXVLYHLQIRUPDWLRQRQWKHEXONKRPRJHQHLW\RI
WKHWHVWVSHFLPHQVZDVREWDLQHGEHFDXVHWKHFKORULGHLQJUHVVVSHFLPHQVKDGWKHVDPH WKHWHVWVSHFLPHQVZDVREWDLQHGEHFDXVHWKHFKORULGHLQJUHVVVSHFLPHQVKDGWKHVDPH
OD\RXWDQGZHUHFDVWDWWKHVDPHWLPHDVWKHDFWLYDWHG7LZLUHVSHFLPHQV6SHFLPHQV OD\RXWDQGZHUHFDVWDWWKHVDPHWLPHDVWKHDFWLYDWHG7LZLUHVSHFLPHQV6SHFLPHQV
ZLWKLQGLFHVVWDUWLQJZLWK³&´DQG³:´LQµ7HVW ,¶ FI6HFWLRQ DVZHOODV ZLWK LQGLFHV VWDUWLQJ ZLWK ³&´ DQG ³:´ LQ µ7HVW ,¶ FI 6HFWLRQ DVZHOODV
³&6:´DQG³:6:´LQµ7HVW,,¶ FI6HFWLRQ ZHUHEDVHGRQFDUERQVWHHOZLUHV ³&6:´DQG³:6:´LQµ7HVW,,¶ FI6HFWLRQ ZHUHEDVHGRQFDUERQVWHHOZLUHV
$GGLWLRQDOO\ VSHFLPHQV ZLWK DFWLYDWHG 7L µ((:V¶ EXW ZLWKRXW UHEDU ZHUH XVHG LQ $GGLWLRQDOO\ VSHFLPHQV ZLWK DFWLYDWHG 7L µ((:V¶ EXW ZLWKRXW UHEDU ZHUH XVHG LQ
ERWKµ7HVW,¶DQGµ7HVW,,¶WRTXDQWLI\WKHµ(FRUU¶GHYHORSPHQWRIWKHDFWLYDWHG7LZLUHV ERWKµ7HVW,¶DQGµ7HVW,,¶WRTXDQWLI\WKHµ(FRUU¶GHYHORSPHQWRIWKHDFWLYDWHG7LZLUHV
HPEHGGHG LQ PRUWDU ZKLOH WKH SRVVLEOH LQIOXHQFH IURP FRUURVLRQ RI WKH UHEDU ZDV HPEHGGHG LQ PRUWDU ZKLOH WKH SRVVLEOH LQIOXHQFH IURP FRUURVLRQ RI WKH UHEDU ZDV
HOLPLQDWHG 6SHFLPHQV ZLWK LQGLFHV VWDUWLQJ ZLWK ³&1´ DQG ³:1´ LQ µ7HVW ,¶ FI HOLPLQDWHG 6SHFLPHQV ZLWK LQGLFHV VWDUWLQJ ZLWK ³&1´ DQG ³:1´ LQ µ7HVW ,¶ FI
6HFWLRQ   DV ZHOO DV ³&15´ DQG ³:15´ LQ µ7HVW ,,¶ FI 6HFWLRQ   ZHUH 6HFWLRQ   DV ZHOO DV ³&15´ DQG ³:15´ LQ µ7HVW ,,¶ FI 6HFWLRQ   ZHUH
EDVHGRQWKLVOD\RXW EDVHGRQWKLVOD\RXW

 0DFURFHOO&XUUHQW0RQLWRULQJ  0DFURFHOO&XUUHQW0RQLWRULQJ


:KHQWKHUHEDUZDVFRQQHFWHGWRWKHFDWKRGHDPL[HGµ(FRUU¶ZDVREWDLQHGDQGIORZ :KHQWKHUHEDUZDVFRQQHFWHGWRWKHFDWKRGHDPL[HGµ(FRUU¶ZDVREWDLQHGDQGIORZ
RIµLPDF¶WKURXJKWKHDPPHWHUVZDVHQDEOHGZLWKRXWLQWURGXFLQJUHVLVWDQFH7KHPL[HG RIµLPDF¶WKURXJKWKHDPPHWHUVZDVHQDEOHGZLWKRXWLQWURGXFLQJUHVLVWDQFH7KHPL[HG
µ(FRUU¶DQGµLPDF¶FRXOGEHLQIOXHQFHGE\UHGXFLQJWKHH[SRVXUHDUHDRIWKHFDWKRGH FI µ(FRUU¶DQGµLPDF¶FRXOGEHLQIOXHQFHGE\UHGXFLQJWKHH[SRVXUHDUHDRIWKHFDWKRGH FI
6HFWLRQ $VORQJDVWKHUHEDUZDVSDVVLYHWKHLPSDFWZDVUDWKHUVPDOOVLQFHWKH 6HFWLRQ $VORQJDVWKHUHEDUZDVSDVVLYHWKHLPSDFWZDVUDWKHUVPDOOVLQFHWKH

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV ,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV

DFWLYDWHG 7L VXUIDFH ZDV DW D PXFK KLJKHU OHYHO RI HOHFWURFKHPLFDO DFWLYLW\ WKDQ WKH DFWLYDWHG 7L VXUIDFH ZDV DW D PXFK KLJKHU OHYHO RI HOHFWURFKHPLFDO DFWLYLW\ WKDQ WKH
VXUIDFHRIWKHSDVVLYHUHEDU FI6HFWLRQ +RZHYHUZKHQFRUURVLRQLQLWLDWHGRU VXUIDFHRIWKHSDVVLYHUHEDU FI6HFWLRQ +RZHYHUZKHQFRUURVLRQLQLWLDWHGRU
WKHUHZDVRWKHUHOHFWURFKHPLFDODFWLYLW\RQWKHUHEDUVXUIDFHWKHFRQWULEXWLRQRIWKH WKHUHZDVRWKHUHOHFWURFKHPLFDODFWLYLW\RQWKHUHEDUVXUIDFHWKHFRQWULEXWLRQRIWKH
UHEDUSRWHQWLDOWRWKHPL[HGµ(FRUU¶LQFUHDVHGODUJHO\+HQFHWKHSRWHQWLDOGURSLHWKH UHEDUSRWHQWLDOWRWKHPL[HGµ(FRUU¶LQFUHDVHGODUJHO\+HQFHWKHSRWHQWLDOGURSLHWKH
GHFUHPHQW RI µ(FRUU¶ RI WKH UHEDU FI 6HFWLRQV  DQG   FRXOG DOVR EH DV GHFUHPHQW RI µ(FRUU¶ RI WKH UHEDU FI 6HFWLRQV  DQG   FRXOG DOVR EH DV
VHVVHGIURPWKHGHFUHPHQWRIWKHPL[HGµ(FRUU¶LQDQDFWLYDWHGPDFURFHOO VHVVHGIURPWKHGHFUHPHQWRIWKHPL[HGµ(FRUU¶LQDQDFWLYDWHGPDFURFHOO
:LWKUHEDUDFWLYLW\GHSRVLWLRQRIFDWLRQV\LHOGHGDFDOFLILFDWLRQOD\HURQWKHVXUIDFH :LWKUHEDUDFWLYLW\GHSRVLWLRQRIFDWLRQV\LHOGHGDFDOFLILFDWLRQOD\HURQWKHVXUIDFH
RI WKH µ(&DW¶ ZKLFK OHG WR DQ µ(FRUU¶ GHFUHPHQW DQG LPSHGHG WKH DFWLYLW\ RI WKH RI WKH µ(&DW¶ ZKLFK OHG WR DQ µ(FRUU¶ GHFUHPHQW DQG LPSHGHG WKH DFWLYLW\ RI WKH
µ(&DW¶ 7KLV OD\HU FRXOG EH VXFFHVVIXOO\ UHPRYHG XVLQJ +&O 7KH µ(&DWV¶ ZHUH UH µ(&DW¶ 7KLV OD\HU FRXOG EH VXFFHVVIXOO\ UHPRYHG XVLQJ +&O 7KH µ(&DWV¶ ZHUH UH
PRYHG IURP WKH H[SRVXUH FRQWDLQHU DQG VXEPHUJHG LQ +&O IRU PLQ EHIRUH WKH\ PRYHG IURP WKH H[SRVXUH FRQWDLQHU DQG VXEPHUJHG LQ +&O IRU PLQ EHIRUH WKH\
ZHUH UHVXEPHUJHG LQ WKH FRQWDLQHU DW WKH EHJLQQLQJ RI HDFK PDFURFHOO GHDFWLYDWLRQ ZHUH UHVXEPHUJHG LQ WKH FRQWDLQHU DW WKH EHJLQQLQJ RI HDFK PDFURFHOO GHDFWLYDWLRQ
SHULRG SHULRG
8QOLNHFXUUHQWPRQLWRULQJXQGHUSRWHQWLRVWDWLFFRQWUROWKHPL[HGSRWHQWLDORIWKHUH 8QOLNHFXUUHQWPRQLWRULQJXQGHUSRWHQWLRVWDWLFFRQWUROWKHPL[HGSRWHQWLDORIWKHUH
EDUDQGµ(&DW¶ZDVQRWSUHVHWDQGSRWHQWLDOIOXFWXDWLRQVZHUHWROHUDWHG7KHIOXFWXD EDUDQGµ(&DW¶ZDVQRWSUHVHWDQGSRWHQWLDOIOXFWXDWLRQVZHUHWROHUDWHG7KHIOXFWXD
WLRQV ZHUH QRW DIIHFWHG E\ WKH VWDWH RI RWKHU VSHFLPHQVEHFDXVHHDFKVSHFLPHQZDV WLRQV ZHUH QRW DIIHFWHG E\ WKH VWDWH RI RWKHU VSHFLPHQVEHFDXVHHDFKVSHFLPHQZDV
HTXLSSHG ZLWK DQ LQGLYLGXDO FDWKRGH :H WKLQN WKDW EHVLGHV SURPRWLQJ LQJUHVV RI HTXLSSHG ZLWK DQ LQGLYLGXDO FDWKRGH :H WKLQN WKDW EHVLGHV SURPRWLQJ LQJUHVV RI
FKORULGH LRQV FI 6HFWLRQ   WKH HOHYDWHG UHEDU µ(FRUU¶ LQ FRPELQDWLRQ ZLWK WKH FKORULGH LRQV FI 6HFWLRQ   WKH HOHYDWHG UHEDU µ(FRUU¶ LQ FRPELQDWLRQ ZLWK WKH
HOHFWURFKHPLFDOO\DFWLYH µ(&DW¶ VXUIDFH XQGHU DHUDWLRQ FUHDWHG DZRUVWFDVHVFHQDULR HOHFWURFKHPLFDOO\DFWLYH µ(&DW¶ VXUIDFH XQGHU DHUDWLRQ FUHDWHG DZRUVWFDVHVFHQDULR
IRUFRUURVLRQLQLWLDWLRQDQGSURSDJDWLRQ:KHQWKHFKORULGHFRQWHQWDWWKHUHLQIRUFH IRUFRUURVLRQLQLWLDWLRQDQGSURSDJDWLRQ:KHQWKHFKORULGHFRQWHQWDWWKHUHLQIRUFH
PHQWOHYHOZDVVXIILFLHQWWRLQLWLDWHFRUURVLRQWKHUHEDUZDVLQDWKHUPRG\QDPLFDOO\ PHQWOHYHOZDVVXIILFLHQWWRLQLWLDWHFRUURVLRQWKHUHEDUZDVLQDWKHUPRG\QDPLFDOO\
DFWLYHVWDWHDWWKHHOHYDWHGSRWHQWLDO DQG XQGHU WKH FDWDO\VLQJHIIHFWRI FKORULGHLRQV DFWLYHVWDWHDWWKHHOHYDWHGSRWHQWLDO DQG XQGHU WKH FDWDO\VLQJ HIIHFW RI FKORULGHLRQV
FI6HFWLRQ  FI6HFWLRQ 
:KHQWKHUHEDUZDVLQWKHSDVVLYHVWDWHWKHµLPDF¶ZDVDURXQG]HURPLFURDPSHUHV,Q :KHQWKHUHEDUZDVLQWKHSDVVLYHVWDWHWKHµLPDF¶ZDVDURXQG]HURPLFURDPSHUHV,Q
WKH DFWLYH VWDWH µLPDF¶ ZDV PHDVXUHG LQ WKH UDQJH RI —$ GHSHQGLQJ RQ WKH WKH DFWLYH VWDWH µLPDF¶ ZDV PHDVXUHG LQ WKH UDQJH RI —$ GHSHQGLQJ RQ WKH
FRQILJXUDWLRQDQGWKHFRUURVLRQVWDWHRIWKHUHEDU6LQFHWKHH[SRVXUHDUHDRIWKHUHEDU FRQILJXUDWLRQDQGWKHFRUURVLRQVWDWHRIWKHUHEDU6LQFHWKHH[SRVXUHDUHDRIWKHUHEDU
ZDVZHOOGHILQHGWKHPHDVXUHGµLPDF¶DOORZHGDQHVWLPDWHRIWKHFRUURVLRQUDWHZKLOH ZDVZHOOGHILQHGWKHPHDVXUHGµLPDF¶DOORZHGDQHVWLPDWHRIWKHFRUURVLRQUDWHZKLOH
WKHHIIHFWRIPLFURRUPDFURFHOOVRQWKHUHEDUVXUIDFHFRXOGQRWEHDVVHVVHG FI6HF WKHHIIHFWRIPLFURRUPDFURFHOOVRQWKHUHEDUVXUIDFHFRXOGQRWEHDVVHVVHG FI6HF
WLRQ 7KHULVHLQµLPDF¶ZLWKLQLWLDWLRQRIDFWLYHFRUURVLRQZDVVKDUSDQGZHOO WLRQ 7KHULVHLQµLPDF¶ZLWKLQLWLDWLRQRIDFWLYHFRUURVLRQZDVVKDUSDQGZHOO
GHILQHGVRWKDWWKHRQVHWRIFRUURVLRQFRXOGEHFOHDUO\LGHQWLILHG GHILQHGVRWKDWWKHRQVHWRIFRUURVLRQFRXOGEHFOHDUO\LGHQWLILHG
7KH PDFURFHOO FRQQHFWLRQ EHWZHHQ UHEDU DQG µ(&DW¶ ZDV IUHTXHQWO\ LQWHUUXSWHG DQG 7KH PDFURFHOO FRQQHFWLRQ EHWZHHQ UHEDU DQG µ(&DW¶ ZDV IUHTXHQWO\ LQWHUUXSWHG DQG
UHDFWLYDWHG DW VHW WLPH LQWHUYDOV ,Q WKLV ZD\ WKH UHEDU DQG FDWKRGH UHWULHYHG WKHLU UHDFWLYDWHG DW VHW WLPH LQWHUYDOV ,Q WKLV ZD\ WKH UHEDU DQG FDWKRGH UHWULHYHG WKHLU
µ(FRUU¶ZKHQGLVFRQQHFWHG7KLVPDGHLWSRVVLEOHWRGUDZFRQFOXVLRQVDERXWWKHWKHU µ(FRUU¶ZKHQGLVFRQQHFWHG7KLVPDGHLWSRVVLEOHWRGUDZFRQFOXVLRQVDERXWWKHWKHU
PRG\QDPLFVWDWHRIWKHUHEDU0RUHRYHUWKHGXUDWLRQRIWKHUHFRYHU\SHULRGDIWHUGH PRG\QDPLFVWDWHRIWKHUHEDU0RUHRYHUWKHGXUDWLRQRIWKHUHFRYHU\SHULRGDIWHUGH
DFWLYDWLRQDQGWKHFXUUHQWSDVVHGRQDFWLYDWLRQRIWKHPDFURFHOOZDVXVHGWRDVVHVVWKH DFWLYDWLRQDQGWKHFXUUHQWSDVVHGRQDFWLYDWLRQRIWKHPDFURFHOOZDVXVHGWRDVVHVVWKH
FRUURVLRQVWDWHRIWKHUHEDU$VLQWKHDQDO\VLVRISRODULVDWLRQUHVLVWDQFHWKLVLQIRUPD FRUURVLRQVWDWHRIWKHUHEDU$VLQWKHDQDO\VLVRISRODULVDWLRQUHVLVWDQFHWKLVLQIRUPD
WLRQ FRXOG EH DSSOLHG WR HVWLPDWH WKH DVVRFLDWHG FRUURVLRQ UDWH )XWXUH SXEOLFDWLRQV WLRQ FRXOG EH DSSOLHG WR HVWLPDWH WKH DVVRFLDWHG FRUURVLRQ UDWH )XWXUH SXEOLFDWLRQV
ZLOO GHDO LQ GHWDLO ZLWK WKH FRPELQDWLRQ RI SRWHQWLDO DQG FXUUHQW PRQLWRULQJ DW WLPH ZLOO GHDO LQ GHWDLO ZLWK WKH FRPELQDWLRQ RI SRWHQWLDO DQG FXUUHQW PRQLWRULQJ DW WLPH
LQWHUYDOVDVDTXDQWLILFDWLRQPHWKRGIRUFRUURVLRQDFWLYLW\ LQWHUYDOVDVDTXDQWLILFDWLRQPHWKRGIRUFRUURVLRQDFWLYLW\

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7HVW6HWXSDQG0HDVXULQJ0HWKRGV ,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV ,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV

 (OHFWURFKHPLFDO,PSHGDQFH6SHFWURVFRS\  (OHFWURFKHPLFDO,PSHGDQFH6SHFWURVFRS\


7KH µ(,6¶ HTXLSPHQW XVHG GXULQJ WKH LQLWLDOSKDVH RI µ7HVW ,¶ DW1RUWKZHVWHUQ8QL 7KH µ(,6¶ HTXLSPHQW XVHG GXULQJ WKH LQLWLDOSKDVH RI µ7HVW ,¶ DW1RUWKZHVWHUQ8QL
YHUVLW\ ZDVDIUHTXHQF\UHVSRQVHDQDO\]HU6RODUWURQ6,>6$@LQFRPELQD YHUVLW\ ZDVDIUHTXHQF\UHVSRQVHDQDO\]HU6RODUWURQ6,>6$@LQFRPELQD
WLRQ ZLWK DQ HOHFWURFKHPLFDO LQWHUIDFH 6RODUWURQ 6,  >6$ @ ZKLFK ZHUH WLRQ ZLWK DQ HOHFWURFKHPLFDO LQWHUIDFH 6RODUWURQ 6,  >6$ @ ZKLFK ZHUH
GDLV\FKDLQHG WR DQ ,%0 FRPSDWLEOH 3& DQG FRQWUROOHG E\ WKH VRIWZDUH =3ORW GDLV\FKDLQHG WR DQ ,%0 FRPSDWLEOH 3& DQG FRQWUROOHG E\ WKH VRIWZDUH =3ORW
>6FULEQHU@µ(,6¶GXULQJWKHVHFRQGSKDVHRIµ7HVW,¶DQGWKURXJKRXWµ7HVW,,¶ DW >6FULEQHU@µ(,6¶GXULQJWKHVHFRQGSKDVHRIµ7HVW,¶DQGWKURXJKRXWµ7HVW,,¶ DW
'78 %\J  ZDV SHUIRUPHG XVLQJ D *DPU\ &06  HOHFWURFKHPLFDO PHDVXUHPHQW '78 %\J  ZDV SHUIRUPHG XVLQJ D *DPU\ &06  HOHFWURFKHPLFDO PHDVXUHPHQW
V\VWHP >*DPU\ @ LQVWDOOHG LQ DQ ,%0 FRPSDWLEOH 3& LQ FRPELQDWLRQ ZLWK WKH V\VWHP >*DPU\ @ LQVWDOOHG LQ DQ ,%0 FRPSDWLEOH 3& LQ FRPELQDWLRQ ZLWK WKH
VRIWZDUH*DPU\)UDPHZRUN>*DPU\@ VRIWZDUH*DPU\)UDPHZRUN>*DPU\@
µ(,6¶ UXQV ZHUH FDUULHG RXW GXULQJ WKH LQWHUYDOV RI PDFURFHOO GHDFWLYDWLRQ DIWHU WKH µ(,6¶ UXQV ZHUH FDUULHG RXW GXULQJ WKH LQWHUYDOV RI PDFURFHOO GHDFWLYDWLRQ DIWHU WKH
UHEDU KDG DWWDLQHG LWV VWDEOH µ(FRUU¶ 5HPRYLQJ RI WKH VSHFLPHQV IURP WKH H[SRVXUH UHEDU KDG DWWDLQHG LWV VWDEOH µ(FRUU¶ 5HPRYLQJ RI WKH VSHFLPHQV IURP WKH H[SRVXUH
FRQWDLQHUZDVQRWUHTXLUHGWRSHUIRUPµ(,6¶DQGµ(FRUU¶PRQLWRULQJFRXOGEHFRQWLQ FRQWDLQHUZDVQRWUHTXLUHGWRSHUIRUPµ(,6¶DQGµ(FRUU¶PRQLWRULQJFRXOGEHFRQWLQ
XHGGXULQJWKHµ(,6¶UXQVZLWKRXWLQWHUIHULQJZLWKWKHGDWD7KLVSURYLGHGXVHIXOLQ XHGGXULQJWKHµ(,6¶UXQVZLWKRXWLQWHUIHULQJZLWKWKHGDWD7KLVSURYLGHGXVHIXOLQ
IRUPDWLRQIRUYHULILFDWLRQSXUSRVHV$OOµ(,6¶UXQVZHUHSHUIRUPHGDWWKHµ(FRUU¶RIWKH IRUPDWLRQIRUYHULILFDWLRQSXUSRVHV$OOµ(,6¶UXQVZHUHSHUIRUPHGDWWKHµ(FRUU¶RIWKH
UHEDU ZLWK DQ DOWHUQDWLQJ YROWDJH SHUWXUEDWLRQ RI P9 7HQ SRLQWV SHU IUHTXHQF\ UHEDU ZLWK DQ DOWHUQDWLQJ YROWDJH SHUWXUEDWLRQ RI P9 7HQ SRLQWV SHU IUHTXHQF\
GHFDGHZHUHPHDVXUHG7KHPD[LPXPDSSOLHGIUHTXHQF\ZDVOLPLWHGWR0+]LQ GHFDGHZHUHPHDVXUHG 7KHPD[LPXPDSSOLHGIUHTXHQF\ ZDVOLPLWHGWR0+]LQ
WKH HTXLSPHQW XVHG 7KH ORZIUHTXHQF\ UDQJH ZDV SUHVHW WR P+] IRU PRVW UXQV WKH HTXLSPHQW XVHG 7KH ORZIUHTXHQF\ UDQJH ZDV SUHVHW WR P+] IRU PRVW UXQV
ZKLOHVRPHPHDVXUHPHQWVGRZQWRP+]ZHUHFDUULHGRXW7KHVWDQGDUGSLQSOXJ ZKLOHVRPHPHDVXUHPHQWVGRZQWRP+]ZHUHFDUULHGRXW7KHVWDQGDUGSLQSOXJ
DWWDFKHGWRWKHVZLWFKFDUGVIRUHDFKVSHFLPHQ FI6HFWLRQ ZDVFRQQHFWHGWRWKH DWWDFKHGWRWKHVZLWFKFDUGVIRUHDFKVSHFLPHQ FI6HFWLRQ ZDVFRQQHFWHGWRWKH
µ(,6¶HTXLSPHQWE\DFXVWRPLVHGDGDSWHU7KHFRQQHFWLRQVHVWDEOLVKHGRQWKHDGDSWHU µ(,6¶HTXLSPHQWE\DFXVWRPLVHGDGDSWHU7KHFRQQHFWLRQVHVWDEOLVKHGRQWKHDGDSWHU
WHUPLQDO ERDUG VKRZQ LQ )LJXUH  DQG WKH FRQILJXUDWLRQ RI WKH SLQV RI WKH µ(,6¶ WHUPLQDO ERDUG VKRZQ LQ )LJXUH  DQG WKH FRQILJXUDWLRQ RI WKH SLQV RI WKH µ(,6¶
HTXLSPHQWSOXJFRUUHVSRQGWRWKH*DPU\&06HOHFWURFKHPLFDOPHDVXUHPHQWV\V HTXLSPHQWSOXJFRUUHVSRQGWRWKH*DPU\&06HOHFWURFKHPLFDOPHDVXUHPHQWV\V
WHP WHP

 
)LJXUH $GDSWHUWHUPLQDOERDUGFXVWRPLVHGIRUFRQQHFWLRQWRWKHDSSOLHGHOHF )LJXUH $GDSWHUWHUPLQDOERDUGFXVWRPLVHGIRUFRQQHFWLRQWRWKHDSSOLHGHOHF
WURFKHPLFDO LPSHGDQFH VSHFWURVFRS\ µ(,6¶ HTXLSPHQW µ(&DW¶ H[WHU WURFKHPLFDO LPSHGDQFH VSHFWURVFRS\ µ(,6¶ HTXLSPHQW µ(&DW¶ H[WHU
QDO FDWKRGH µ((:¶ HPEHGGHG HOHFWURGH ZLUH µ:(¶ ZRUNLQJ HOHF QDO FDWKRGH µ((:¶ HPEHGGHG HOHFWURGH ZLUH µ:(¶ ZRUNLQJ HOHF
WURGH µ5(¶ UHIHUHQFH HOHFWURGH µ&(¶ FRXQWHU HOHFWURGH µ&6¶  WURGH µ5(¶ UHIHUHQFH HOHFWURGH µ&(¶ FRXQWHU HOHFWURGH µ&6¶ 
FRXQWHUVHQVHDQG µ&*¶ FKDVVLVJURXQG7KHOD\RXWRIWKHDGDSWHU FRXQWHUVHQVHDQG µ&*¶ FKDVVLVJURXQG7KHOD\RXWRIWKHDGDSWHU
WHUPLQDO ERDUG FRUUHVSRQG WR FRQQHFWLRQ WR D *DPU\ &06  HOHF WHUPLQDO ERDUG FRUUHVSRQG WR FRQQHFWLRQ WR D *DPU\ &06  HOHF
WURFKHPLFDO PHDVXUHPHQW V\VWHP >*DPU\ @ 7KH FRORXU FRGH RI WURFKHPLFDO PHDVXUHPHQW V\VWHP >*DPU\ @ 7KH FRORXU FRGH RI
WKHVSHFLPHQFRQQHFWLRQSLQVFRUUHVSRQGVWRWKHFRORXUVXVHGIRUWKH WKHVSHFLPHQFRQQHFWLRQSLQVFRUUHVSRQGVWRWKHFRORXUVXVHGIRU WKH
FRQGXFWRUV FRQQHFWHG WR WKH VZLWFK FDUG FI )LJXUH  LQ 6HFWLRQ FRQGXFWRUV FRQQHFWHG WR WKH VZLWFK FDUG FI )LJXUH  LQ 6HFWLRQ
   

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV ,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV

7KHDGDSWHUIHDWXUHGWZRFRQGXFWRUFDEOHVZLWKVWDQGDUGSOXJVIRUFRQQHFWLRQWRWKH 7KHDGDSWHUIHDWXUHGWZRFRQGXFWRUFDEOHVZLWKVWDQGDUGSOXJVIRUFRQQHFWLRQWRWKH
LQGLYLGXDOVSHFLPHQSOXJVDQGWKHµ(,6¶HTXLSPHQW7KHDVVRFLDWHGVLJQDOVZHUHGLV LQGLYLGXDOVSHFLPHQSOXJVDQGWKHµ(,6¶HTXLSPHQW7KHDVVRFLDWHGVLJQDOVZHUHGLV
WULEXWHG E\ VLQJOHFRQGXFWRU FRQQHFWLRQV EHWZHHQ WZR VFUHZ WHUPLQDOV LQ WKH VDPH WULEXWHG E\ VLQJOHFRQGXFWRU FRQQHFWLRQV EHWZHHQ WZR VFUHZ WHUPLQDOV LQ WKH VDPH
PDQQHUDVIRUWKHGLVWULEXWLRQWHUPLQDOERDUGEXWRQDVPDOOHUVFDOH7KHFRQGXFWRUV PDQQHUDVIRUWKHGLVWULEXWLRQWHUPLQDOERDUGEXWRQDVPDOOHUVFDOH7KHFRQGXFWRUV
RIWKHUHEDUWKHVL[µ((:V¶DQGWKHµ(&DW¶FRUUHVSRQGHGWRWKHRXWSXWVLJQDOIURPWKH RIWKHUHEDUWKHVL[µ((:V¶DQGWKHµ(&DW¶FRUUHVSRQGHGWRWKHRXWSXWVLJQDOIURPWKH
VSHFLPHQ SOXJ 7ZR FRD[LDO SOXJV ZHUH SURYLGHG IRU FRQQHFWLRQ RI H[WHUQDO HOHF VSHFLPHQ SOXJ 7ZR FRD[LDO SOXJV ZHUH SURYLGHG IRU FRQQHFWLRQ RI H[WHUQDO HOHF
WURGHV7KHUHEDUFRQGXFWRUZDVFRQQHFWHGWRWKHZRUNLQJHOHFWURGHLQSXWRIWKHDS WURGHV7KHUHEDUFRQGXFWRUZDVFRQQHFWHGWRWKHZRUNLQJHOHFWURGHLQSXWRIWKHDS
SOLHG µ(,6¶ HTXLSPHQW 7ZR ZRUNLQJ HOHFWURGH LQSXWV RQH HTXLSSHG ZLWK D UHVLVWRU SOLHG µ(,6¶ HTXLSPHQW 7ZR ZRUNLQJ HOHFWURGH LQSXWV RQH HTXLSSHG ZLWK D UHVLVWRU
ZHUH D W\SHVSHFLILF IHDWXUH IRU WKH µ(,6¶ HTXLSPHQW XVHG 'XULQJ FXVWRPDU\ µ(,6¶ ZHUH D W\SHVSHFLILF IHDWXUH IRU WKH µ(,6¶ HTXLSPHQW XVHG 'XULQJ FXVWRPDU\ µ(,6¶
UXQV WKH LQQHU FLUFOH RI µ((:V¶ ZDV FRQQHFWHG WR WKH µ5(¶ LQSXW ZKLFK ZDV DOVR UXQV WKH LQQHU FLUFOH RI µ((:V¶ ZDV FRQQHFWHG WR WKH µ5(¶ LQSXW ZKLFK ZDV DOVR
HTXLSSHGZLWKDUHVLVWRUZKLOHWKHRXWHUFLUFOHRIHOHFWURGHZLUHVZDVFRQQHFWHGWRWKH HTXLSSHGZLWKDUHVLVWRUZKLOHWKHRXWHUFLUFOHRIHOHFWURGHZLUHVZDVFRQQHFWHGWRWKH
µ&(¶LQSXW µ&(¶LQSXW
3ULRULQYHVWLJDWLRQVRQWKHLQVWUXPHQWHGPRUWDUVSHFLPHQGHVLJQKDGVKRZQWKDWGLV 3ULRULQYHVWLJDWLRQVRQWKHLQVWUXPHQWHGPRUWDUVSHFLPHQGHVLJQKDGVKRZQWKDWGLV
WRUWLRQ RI WKH µ(,6¶ GDWD GXH WR YDU\LQJ UHIHUHQFH HOHFWURGH SRVLWLRQV DQG HOHFWURGH WRUWLRQ RI WKH µ(,6¶ GDWD GXH WR YDU\LQJ UHIHUHQFH HOHFWURGH SRVLWLRQV DQG HOHFWURGH
DUWHIDFWV FI6HFWLRQ FDQEHSUHYHQWHGE\XVLQJDFWLYDWHG7LZLUHVDQGWKHGH DUWHIDFWV FI6HFWLRQ FDQEHSUHYHQWHGE\XVLQJDFWLYDWHG7LZLUHVDQGWKHGH
ILQHG OD\RXW RI WKH VSHFLPHQ UHVSHFWLYHO\ >.WHU HWDO E@7KDWZD\WKHµ(,6¶ ILQHG OD\RXW RI WKH VSHFLPHQ UHVSHFWLYHO\ >.WHU HWDO E@ 7KDW ZD\WKHµ(,6¶
GDWD EHFDPH IXOO\ UHSURGXFLEOH DQG DOO VHFRQGDU\ LQIOXHQFHV ZHUH HOLPLQDWHG 7KLV GDWD EHFDPH IXOO\ UHSURGXFLEOH DQG DOO VHFRQGDU\ LQIOXHQFHV ZHUH HOLPLQDWHG 7KLV
HQDEOHGFRPSDULVRQRIGDWDIURPGLIIHUHQWWLPHLQWHUYDOVIRUDQHVWLPDWLRQRIFKDQJHV HQDEOHGFRPSDULVRQRIGDWDIURPGLIIHUHQWWLPHLQWHUYDOVIRUDQHVWLPDWLRQRIFKDQJHV
LQWKHWKHUPRG\QDPLFSURSHUWLHV)XUWKHUPRUHWKHHIIHFWRIGLIIHUHQWFRUURVLRQFRXQ LQWKHWKHUPRG\QDPLFSURSHUWLHV)XUWKHUPRUHWKHHIIHFWRIGLIIHUHQWFRUURVLRQFRXQ
WHUPHDVXUHVFRXOGEHFRPSDUHGEDVHGRQTXDQWLWDWLYHµ(,6¶GDWDIURPWKHVDPHWLPH WHUPHDVXUHVFRXOGEHFRPSDUHGEDVHGRQTXDQWLWDWLYHµ(,6¶GDWDIURPWKHVDPHWLPH
LQWHUYDO%HFDXVHWKHHOHFWURGHZLUHVFRXOGDFWDVERWKµ5(¶DQGµ&(¶H[WHUQDOHOHF LQWHUYDO%HFDXVHWKHHOHFWURGHZLUHVFRXOGDFWDVERWKµ5(¶DQGµ&(¶H[WHUQDOHOHF
WURGHVZHUHQRWUHTXLUHGDQGµ(,6¶UXQVFRXOGEHSHUIRUPHGEHIRUHVXEPHUVLRQRIWKH WURGHVZHUHQRWUHTXLUHGDQGµ(,6¶UXQVFRXOGEHSHUIRUPHGEHIRUHVXEPHUVLRQRIWKH
VSHFLPHQVRUGXULQJGU\LQJSHULRGV VSHFLPHQVRUGXULQJGU\LQJSHULRGV
)RU YHULILFDWLRQ UXQV HLWKHU RQH RU ERWK RI WKH µ5(¶ DQG µ&(¶ FRQQHFWLRQV ZHUH UH )RU YHULILFDWLRQ UXQV HLWKHU RQH RU ERWK RI WKH µ5(¶ DQG µ&(¶ FRQQHFWLRQV ZHUH UH
SODFHGE\FRQQHFWLRQVWRH[WHUQDOHOHFWURGHVFRQQHFWHGWRWKHWZRFRD[LDOSOXJVVHH SODFHGE\FRQQHFWLRQVWRH[WHUQDOHOHFWURGHVFRQQHFWHGWRWKHWZRFRD[LDOSOXJVVHH
)LJXUH7KHH[WHUQDOµ5(¶DQGµ&(¶ZHUHSRVLWLRQHGLQWKHDGGLWLRQDOPPGL )LJXUH7KHH[WHUQDOµ5(¶DQGµ&(¶ZHUHSRVLWLRQHGLQWKHDGGLWLRQDOPPGL
DPHWHUKROHVQH[WWRWKHDVVRFLDWHGVSHFLPHQ FI6HFWLRQ $Q\FRPSRQHQWFRXOG DPHWHUKROHVQH[WWRWKHDVVRFLDWHGVSHFLPHQ FI6HFWLRQ $Q\FRPSRQHQWFRXOG
EHFRQQHFWHGWRWKHµ:(¶LQSXWWREHHOHFWURFKHPLFDOO\TXDQWLILHGE\VXSSOHPHQWDU\ EHFRQQHFWHGWRWKHµ:(¶LQSXWWREHHOHFWURFKHPLFDOO\TXDQWLILHGE\VXSSOHPHQWDU\
µ(,6¶UXQV,Q)LJXUHDQH[DPSOHLVVKRZQRIWKHµ(&DW¶XVHGDVµ:(¶LQVWHDGRI µ(,6¶UXQV,Q)LJXUHDQH[DPSOHLVVKRZQRIWKHµ(&DW¶XVHGDVµ:(¶LQVWHDGRI
WKHUHEDU,QWKLVFRQILJXUDWLRQLWLVUHFRPPHQGHGWRXVHDQH[WHUQDOµ5(¶DQGµ&(¶ WKHUHEDU,QWKLVFRQILJXUDWLRQLWLVUHFRPPHQGHGWRXVHDQH[WHUQDOµ5(¶DQGµ&(¶
7KHFRXQWHUVHQVH µ&6¶ DQGWKHFKDVVLVJURXQG µ&*¶ ZHUHDGGLWLRQDOW\SHVSHFLILF 7KHFRXQWHUVHQVH µ&6¶ DQGWKHFKDVVLVJURXQG µ&*¶ ZHUHDGGLWLRQDOW\SHVSHFLILF
IHDWXUHV RI WKH *DPU\ &06  7KH FRXQWHU VHQVH ZDV WR EH FRQQHFWHG ZKHQ WKH IHDWXUHV RI WKH *DPU\ &06  7KH FRXQWHU VHQVH ZDV WR EH FRQQHFWHG ZKHQ WKH
µ(,6¶HTXLSPHQWZDVWREHXVHGLQWKH]HURLPSHGDQFHDPPHWHUPRGHDQGWKHFKDV µ(,6¶HTXLSPHQWZDVWREHXVHGLQWKH]HURLPSHGDQFHDPPHWHUPRGHDQGWKHFKDV
VLVJURXQGFRXOGEHFRQQHFWHGWRD)DUDGD\VKLHOGWRUHGXFHHOHFWURPDJQHWLFLQWHUIHU VLVJURXQGFRXOGEHFRQQHFWHGWRD)DUDGD\VKLHOGWRUHGXFHHOHFWURPDJQHWLFLQWHUIHU
HQFH µ(0,¶  7KH DVVRFLDWHG WHUPLQDOV ZHUH QRW FRQQHFWHG IRU WKH µ(,6¶ UXQV EXW HQFH µ(0,¶  7KH DVVRFLDWHG WHUPLQDOV ZHUH QRW FRQQHFWHG IRU WKH µ(,6¶ UXQV EXW
FRXOGEHXVHGIRURWKHUHOHFWURFKHPLFDOPHDVXUHPHQWV)RULQVWDQFHWKHDGDSWHUFRXOG FRXOGEHXVHGIRURWKHUHOHFWURFKHPLFDOPHDVXUHPHQWV)RULQVWDQFHWKHDGDSWHUFRXOG
EH PRGLILHG WR WKH ]HURLPSHGDQFHDPPHWHU PRGH ZKLFK PDGH LW SRVVLEOH WR PDNH EH PRGLILHG WR WKH ]HURLPSHGDQFHDPPHWHU PRGH ZKLFK PDGH LW SRVVLEOH WR PDNH
DFFXUDWHPHDVXUHPHQWVRIWKHEXONUHVLVWLYLW\HJEHWZHHQWZRµ((:V¶RUVROXWLRQ DFFXUDWHPHDVXUHPHQWVRIWKHEXONUHVLVWLYLW\HJEHWZHHQWZRµ((:V¶RUVROXWLRQ
UHVLVWLYLW\HJEHWZHHQWZRH[WHUQDOHOHFWURGHV UHVLVWLYLW\HJEHWZHHQWZRH[WHUQDOHOHFWURGHV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7HVW6HWXSDQG0HDVXULQJ0HWKRGV ,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV ,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV

6LPLODUFRQQHFWLRQVRUPRGLILHGDGDSWHUWHUPLQDOVFRXOGEHXVHGWRFRQQHFWDQ\RWKHU 6LPLODUFRQQHFWLRQVRUPRGLILHGDGDSWHUWHUPLQDOVFRXOGEHXVHGWRFRQQHFWDQ\RWKHU
NLQGRIHOHFWURFKHPLFDOPHDVXULQJHTXLSPHQWWRDQLQGLYLGXDOVSHFLPHQHJDSRWHQ NLQGRIHOHFWURFKHPLFDOPHDVXULQJHTXLSPHQWWRDQLQGLYLGXDOVSHFLPHQHJDSRWHQ
WLRVWDW FI6HFWLRQ  WLRVWDW FI6HFWLRQ 

 3RODULVDWLRQ&XUYHV  3RODULVDWLRQ&XUYHV


7KH H[SHULPHQWDO VHWXS SURYLGHV GLIIHUHQW RSWLRQV IRU SHUIRUPLQJ SRODULVDWLRQ FXUYH 7KH H[SHULPHQWDO VHWXS SURYLGHV GLIIHUHQW RSWLRQV IRU SHUIRUPLQJ SRODULVDWLRQ FXUYH
PHDVXUHPHQWV DQG RWKHUSRWHQWLRVWDWLF PHDVXUHPHQWV ZLWKLQ WKH H[SRVXUHFRQWDLQHUV PHDVXUHPHQWV DQG RWKHUSRWHQWLRVWDWLF PHDVXUHPHQWV ZLWKLQ WKH H[SRVXUHFRQWDLQHUV
FI6HFWLRQ $VPHQWLRQHGLQ6HFWLRQWKHDGDSWHUWHUPLQDOERDUG FI)LJ FI6HFWLRQ $VPHQWLRQHGLQ6HFWLRQWKHDGDSWHUWHUPLQDOERDUG FI)LJ
XUH   FRXOG EH FXVWRPLVHG VR WKDW D SRWHQWLRVWDW RU DQ\ RWKHU HOHFWURFKHPLFDO XUH   FRXOG EH FXVWRPLVHG VR WKDW D SRWHQWLRVWDW RU DQ\ RWKHU HOHFWURFKHPLFDO
HTXLSPHQW FRXOG EH FRQQHFWHG WR WKH VWDQGDUG SLQ SOXJ FI 6HFWLRQ   7KDW HTXLSPHQW FRXOG EH FRQQHFWHG WR WKH VWDQGDUG SLQ SOXJ FI 6HFWLRQ   7KDW
ZD\ WKH LQVWUXPHQWHG PRUWDU VSHFLPHQV FRXOG EH FRQYHQLHQWO\ WHVWHG RU PHDVXUH ZD\ WKH LQVWUXPHQWHG PRUWDU VSHFLPHQV FRXOG EH FRQYHQLHQWO\ WHVWHG RU PHDVXUH
PHQWV FRXOGEHSHUIRUPHG XVLQJ RWKHU VSHFLPHQV LQ FRPELQDWLRQ ZLWKH[WHUQDOHOHF PHQWV FRXOGEHSHUIRUPHG XVLQJ RWKHU VSHFLPHQV LQ FRPELQDWLRQ ZLWKH[WHUQDOHOHF
WURGHV7KHH[WUDKROHVQH[WWRWKHVSHFLPHQVSURYLGHGGHILQHGSRVLWLRQVIRUµ5(¶DQG WURGHV7KHH[WUDKROHVQH[WWRWKHVSHFLPHQVSURYLGHGGHILQHGSRVLWLRQVIRUµ5(¶DQG
µ&(¶µ(&DWV¶ FI6HFWLRQ FRXOGDOVREHXVHGIRUWKLVSXUSRVH$Vµ(FRUU¶PRQL µ&(¶µ(&DWV¶ FI6HFWLRQ FRXOGDOVREHXVHGIRUWKLVSXUSRVH$Vµ(FRUU¶PRQL
WRULQJ FI6HFWLRQ RUµ(,6¶ FI6HFWLRQ SRODULVDWLRQFXUYHPHDVXUH WRULQJ FI6HFWLRQ RUµ(,6¶ FI6HFWLRQ SRODULVDWLRQFXUYHPHDVXUH
PHQWVFRXOGEHSHUIRUPHGEHIRUHVXEPHUVLRQRUGXULQJQRQVXEPHUVLRQSHULRGVVLQFH PHQWVFRXOGEHSHUIRUPHGEHIRUHVXEPHUVLRQRUGXULQJQRQVXEPHUVLRQSHULRGVVLQFH
DOOUHTXLUHGHOHFWURGHVDUHHPEHGGHGLQWKHLQVWUXPHQWHGPRUWDUVSHFLPHQV1HYHUWKH DOOUHTXLUHGHOHFWURGHVDUHHPEHGGHGLQWKHLQVWUXPHQWHGPRUWDUVSHFLPHQV1HYHUWKH
OHVV WKH VWDQGDUG IXOOVFDOH DQRGLF  SRODULVDWLRQ FXUYH PHDVXUHPHQWV ZHUH SHU OHVV WKH VWDQGDUG IXOOVFDOH DQRGLF  SRODULVDWLRQ FXUYH PHDVXUHPHQWV ZHUH SHU
IRUPHGRQDVXSSOHPHQWDU\WKUHHHOHFWURGHVHWXSVHH)LJXUH>$@DQG>%@ IRUPHGRQDVXSSOHPHQWDU\WKUHHHOHFWURGHVHWXSVHH)LJXUH>$@DQG>%@

 
)LJXUH >$@ 7KUHHSRLQW HOHFWURGH VHWXS IRU GHVWUXFWLYH HOHFWURFKHPLFDO WHVW )LJXUH >$@ 7KUHHSRLQW HOHFWURGH VHWXS IRU GHVWUXFWLYH HOHFWURFKHPLFDO WHVW
LQJ 'XULQJ WHVWLQJ RI JULWEODVWHG FHPHQW SDVWH VSHFLPHQ VSHFLPHQ LQJ 'XULQJ WHVWLQJ RI JULWEODVWHG FHPHQW SDVWH VSHFLPHQ VSHFLPHQ
³&*´ FI 6HFWLRQ   >%@ $V >$@ EXW DIWHU WHVWLQJ RI JULW ³&*´ FI 6HFWLRQ   >%@ $V >$@ EXW DIWHU WHVWLQJ RI JULW
EODVWHGFHPHQWSDVWHVSHFLPHQZLWKPDMRUSUHFLSLWDWLRQRIEODFNUXVW EODVWHGFHPHQWSDVWHVSHFLPHQZLWKPDMRUSUHFLSLWDWLRQRIEODFNUXVW
>&@ *ULWEODVWHG FHPHQW SDVWH VSHFLPHQ DIWHU WHVWLQJ ZLWK VHYHUH >&@ *ULWEODVWHG FHPHQW SDVWH VSHFLPHQ DIWHU WHVWLQJ ZLWK VHYHUH
FUDFNLQJDQGGHSRVLWLRQRIUHGJUHHQEODFNUXVW>'@6WDLQOHVVFHPHQW FUDFNLQJDQGGHSRVLWLRQRIUHGJUHHQEODFNUXVW>'@6WDLQOHVVFHPHQW
SDVWHVSHFLPHQ VSHFLPHQ³&-´FI6HFWLRQ DIWHUWHVWLQJDQG SDVWHVSHFLPHQ VSHFLPHQ³&-´FI6HFWLRQ DIWHUWHVWLQJDQG
UHPRYDORIWKHFHPHQWOD\HUWRLQYHVWLJDWHWKHSK\VLFDODSSHDUDQFHRI UHPRYDORIWKHFHPHQWOD\HUWRLQYHVWLJDWHWKHSK\VLFDODSSHDUDQFHRI
WKHFRUURVLRQGDPDJHVKRZLQJVHYHUHSLWWLQJGDPDJH WKHFRUURVLRQGDPDJHVKRZLQJVHYHUHSLWWLQJGDPDJH

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV ,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV

7KHUHDVRQVIRUSHUIRUPLQJSRODULVDWLRQFXUYHVRQDVXSSOHPHQWDU\VHWXSZDVWKHKR 7KHUHDVRQVIRUSHUIRUPLQJSRODULVDWLRQFXUYHVRQDVXSSOHPHQWDU\VHWXSZDVWKHKR
PRJHQRXVILHOGVXSSOLHGE\WKHDFWLYDWHG7LZLUHPHVK VHH)LJXUH>$@ XVHGDV PRJHQRXVILHOGVXSSOLHGE\WKHDFWLYDWHG7LZLUHPHVK VHH)LJXUH>$@ XVHGDV
µ&(¶DQGPRVWLPSRUWDQWO\WKHPDMRUIRUPDWLRQRIFRUURVLRQSURGXFWVLQIXOOVFDOHDQ µ&(¶DQGPRVWLPSRUWDQWO\WKHPDMRUIRUPDWLRQRIFRUURVLRQSURGXFWVLQIXOOVFDOHDQ
RGLF WHVWLQJ ZKLFK ZRXOG KDYH UHTXLUHG D FKDQJH RI VROXWLRQ LQ WKH H[SRVXUH VHWXS RGLF WHVWLQJ ZKLFK ZRXOG KDYH UHTXLUHG D FKDQJH RI VROXWLRQ LQ WKH H[SRVXUH VHWXS
FI6HFWLRQ DIWHUHDFKWHVW7KLVLVH[HPSOLILHGE\WKHGHSRVLWLRQRIEODFNUXVWLQ FI6HFWLRQ DIWHUHDFKWHVW7KLVLVH[HPSOLILHGE\WKHGHSRVLWLRQRIEODFNUXVWLQ
WKH H[SRVXUH VROXWLRQ DIWHU WHVWLQJ VHH )LJXUH  >%@  DQG WKH GHSRVLWLRQ RI JUHHQ WKH H[SRVXUH VROXWLRQ DIWHU WHVWLQJ VHH )LJXUH  >%@  DQG WKH GHSRVLWLRQ RI JUHHQ
UXVWRQWKHDVVRFLDWHGJULWEODVWHGVDPSOH VHH)LJXUH>&@  UXVWRQWKHDVVRFLDWHGJULWEODVWHGVDPSOH VHH)LJXUH>&@ 
7KHDFU\OLFJODVVSODWHRQWRSRIWKHFRUURVLRQFHOOZDVXVHGDVDQDGDSWHUIRUWHVWLQJ 7KHDFU\OLFJODVVSODWHRQWRSRIWKHFRUURVLRQFHOOZDVXVHGDVDQDGDSWHUIRUWHVWLQJ
WKHFHPHQWSDVWHVSHFLPHQV,QVWUXPHQWHGRUSODLQPRUWDUVSHFLPHQVFRXOGEHWHVWHG WKHFHPHQWSDVWHVSHFLPHQV,QVWUXPHQWHGRUSODLQPRUWDUVSHFLPHQVFRXOGEHWHVWHG
RQ WKH VDPH VHWXS ZKLOH EHLQJ VXSSRUWHG DQG FHQWUHG E\ WKH ORZHU SODVWLF ULQJ RQ WKH VDPH VHWXS ZKLOH EHLQJ VXSSRUWHG DQG FHQWUHG E\ WKH ORZHU SODVWLF ULQJ
ZKLWH VHH)LJXUH>$@3RODULVDWLRQFXUYHPHDVXUHPHQWVDVZHOODVDOORWKHUSR ZKLWH VHH)LJXUH>$@3RODULVDWLRQFXUYHPHDVXUHPHQWVDVZHOODVDOORWKHUSR
WHQWLRVWDWLF HOHFWURFKHPLFDO PHDVXUHPHQWV ZHUH SHUIRUPHG E\ PHDQV RI D 9ROWD/DE WHQWLRVWDWLF HOHFWURFKHPLFDO PHDVXUHPHQWV ZHUH SHUIRUPHG E\ PHDQV RI D 9ROWD/DE
 3*= DOOLQRQHHOHFWURFKHPLFDOODERUDWRU\>5$@FRQQHFWHGWRDQ,%0  3*= DOOLQRQHHOHFWURFKHPLFDOODERUDWRU\>5$@FRQQHFWHGWRDQ,%0
FRPSDWLEOH 3& WKH VRIWZDUH XVHG ZDV 9ROWD0DVWHU  >5$ @ 3RODULVDWLRQ FRPSDWLEOH 3& WKH VRIWZDUH XVHG ZDV 9ROWD0DVWHU  >5$ @ 3RODULVDWLRQ
FXUYHVZHUHGHWHUPLQHGLQGLIIHUHQWZD\VEXWJHQHUDOO\EDVHGRQWZRRUPRUH³DQRGLF FXUYHVZHUHGHWHUPLQHGLQGLIIHUHQWZD\VEXWJHQHUDOO\EDVHGRQWZRRUPRUH³DQRGLF
ORRSV´7KH³ORRSV´ZHUHVWDUWHGDWDQHOHFWURGHSRWHQWLDORIP9EHORZWKHµ(FRUU¶ ORRSV´7KH³ORRSV´ZHUHVWDUWHGDWDQHOHFWURGHSRWHQWLDORIP9EHORZWKHµ(FRUU¶
WKDWZDVHVWDEOLVKHGDIWHUDSUHGHILQHGWLPHRIVXEPHUVLRQRQWKHVHWXS QRUPDOO\ WKDWZDVHVWDEOLVKHGDIWHUDSUHGHILQHGWLPHRIVXEPHUVLRQRQWKHVHWXS QRUPDOO\
KRXUV 'LIIHUHQWPD[LPXPHOHFWURGHSRWHQWLDOVZHUHWHVWHGDQGWKHVFDQUDWHZDVYDU KRXUV 'LIIHUHQWPD[LPXPHOHFWURGHSRWHQWLDOVZHUHWHVWHGDQGWKHVFDQUDWHZDVYDU
LHGEHWZHHQDQGP9V LHGEHWZHHQDQGP9V

 $GGLWLRQDO0HDVXUHPHQW7HFKQLTXHV  $GGLWLRQDO0HDVXUHPHQW7HFKQLTXHV


%HVLGHV WKHVH HOHFWURFKHPLFDOO\ WHVWHG LH PRQLWRUHG  VSHFLPHQV D QXPEHU RI WKH %HVLGHV WKHVH HOHFWURFKHPLFDOO\ WHVWHG LH PRQLWRUHG  VSHFLPHQV D QXPEHU RI WKH
FRQWDLQHU SRVLWLRQV ZKLFK GLG QRW SURYLGH DQ µ(&DW¶ FRQQHFWLRQ $' VHH )LJXUH  FRQWDLQHU SRVLWLRQV ZKLFK GLG QRW SURYLGH DQ µ(&DW¶ FRQQHFWLRQ $' VHH )LJXUH 
>%@ ZHUHHTXLSSHGZLWKSODLQPRUWDUVSHFLPHQV3ODLQPRUWDUVSHFLPHQVZHUHEDVHG >%@ ZHUHHTXLSSHGZLWKSODLQPRUWDUVSHFLPHQV3ODLQPRUWDUVSHFLPHQVZHUHEDVHG
RQ WKH OD\RXW DV WKH PRUWDU WHVW VSHFLPHQV EXW ZLWKRXW UHEDU DQG µ((:V¶ 7KHVH RQ WKH OD\RXW DV WKH PRUWDU WHVW VSHFLPHQV EXW ZLWKRXW UHEDU DQG µ((:V¶ 7KHVH
VSHFLPHQV ZHUH VSOLW DQG WHVWHG IRU FKORULGH LQJUHVV E\ PHDQV RI WKH FRORXU WHVW VSHFLPHQV ZHUH VSOLW DQG WHVWHG IRU FKORULGH LQJUHVV E\ PHDQV RI WKH FRORXU WHVW
>)UHGHULNVHQ@ FI6HFWLRQ 6SHFLPHQVZLWKWKHLQGLFHVVWDUWLQJZLWK³& >)UHGHULNVHQ@ FI6HFWLRQ 6SHFLPHQVZLWKWKHLQGLFHVVWDUWLQJZLWK³&
3´DQG³:3´LQµ7HVW,¶ FI6HFWLRQ DVZHOODV³&30´DQG³:30´LQµ7HVW,,¶ 3´DQG³:3´LQµ7HVW,¶ FI6HFWLRQ DVZHOODV³&30´DQG³:30´LQµ7HVW,,¶
FI6HFWLRQ ZHUHSODLQPRUWDUVSHFLPHQ 7KHWKUHVKROGIRUFRORXUFKDQJHVDQG FI6HFWLRQ ZHUHSODLQPRUWDUVSHFLPHQ 7KHWKUHVKROGIRUFRORXUFKDQJHVDQG
WKH LQJUHVV SDUDPHWHUV ZHUH FDOLEUDWHG E\ FKORULGH SURILOHV IURP JULQGLQJ RI FXELFDO WKH LQJUHVV SDUDPHWHUV ZHUH FDOLEUDWHG E\ FKORULGH SURILOHV IURP JULQGLQJ RI FXELFDO
VSHFLPHQV HJDFFRUGLQJWR17%8,/'>)UHGHULNVHQ@FI6HFWLRQ  VSHFLPHQV HJDFFRUGLQJWR17%8,/'>)UHGHULNVHQ@FI6HFWLRQ 
ZKLFKZHUHVWRUHGLQWKHIUHHVSDFHVRIWKHH[SRVXUHFRQWDLQHURULQWKHUHVHUYRLU7KH ZKLFKZHUHVWRUHGLQWKHIUHHVSDFHVRIWKHH[SRVXUHFRQWDLQHURULQWKHUHVHUYRLU7KH
UDWLRRIVROXWLRQYROXPHWRWKHH[SRVHGPRUWDUVXUIDFHDUHDZDVDGMXVWHGDFFRUGLQJO\ UDWLRRIVROXWLRQYROXPHWRWKHH[SRVHGPRUWDUVXUIDFHDUHDZDVDGMXVWHGDFFRUGLQJO\
FI6HFWLRQ  FI6HFWLRQ 
:LUHVZLWKDKLJKHUVHQVLWLYLW\WRFKORULGHHJ$J$J&OZLUHVRUZLWKVHQVLWLYLW\WR :LUHVZLWKDKLJKHUVHQVLWLYLW\WRFKORULGHHJ$J$J&OZLUHVRUZLWKVHQVLWLYLW\WR
RWKHUSDUDPHWHUVHJJUDSKLWHIRUR[\JHQVHQVLWLYLW\FRXOGEHHPSOR\HGDVDQDOWHU RWKHUSDUDPHWHUVHJJUDSKLWHIRUR[\JHQVHQVLWLYLW\FRXOGEHHPSOR\HGDVDQDOWHU

 

3ODLQPRUWDUVSHFLPHQVH[SRVHGLQWKHSRWDEOHZDWHUFRQWDLQHUVSURYLGHGWKHUHIHUHQFHPDWHULDOIRU 3ODLQPRUWDUVSHFLPHQVH[SRVHGLQWKHSRWDEOHZDWHUFRQWDLQHUVSURYLGHGWKHUHIHUHQFHPDWHULDOIRU
FKHPLFDOWHVWVHJIRUWHVWLQJRIWKHPRUWDUS+E\SKHQROSKWKDOHLQVROXWLRQRUUDLQERZLQGLFDWRU FI FKHPLFDOWHVWVHJIRUWHVWLQJRIWKHPRUWDUS+E\SKHQROSKWKDOHLQVROXWLRQRUUDLQERZLQGLFDWRU FI
6HFWLRQVDQG WHVWLQJRIWKHFKORULGHFRQWHQWE\WKHFRORXUWHVW FI6HFWLRQ  6HFWLRQVDQG WHVWLQJRIWKHFKORULGHFRQWHQWE\WKHFRORXUWHVW FI6HFWLRQ 
DQGIRUµ/20¶µ6(0¶RUµ('6¶DQDO\VHVRIWKHPRUWDU DQGIRUµ/20¶µ6(0¶RUµ('6¶DQDO\VHVRIWKHPRUWDU

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


7HVW6HWXSDQG0HDVXULQJ0HWKRGV ,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV 7HVW6HWXSDQG0HDVXULQJ0HWKRGV ,PSOHPHQWDWLRQRI0HDVXUHPHQW7HFKQLTXHV

QDWLYH µ((:¶ WR REWDLQ LQIRUPDWLRQ RQ VSHFLILF SURSHUWLHV RU WLPHGHSHQGHQW DOWHUD QDWLYH µ((:¶ WR REWDLQ LQIRUPDWLRQ RQ VSHFLILF SURSHUWLHV RU WLPHGHSHQGHQW DOWHUD
WLRQVLQVLGHWKHVSHFLPHQ7KHVHDVSHFWVZLOOEHHYDOXDWHGLQIXWXUHLQYHVWLJDWLRQV WLRQVLQVLGHWKHVSHFLPHQ7KHVHDVSHFWVZLOOEHHYDOXDWHGLQIXWXUHLQYHVWLJDWLRQV
7KHS+RIWKHH[SRVXUHVROXWLRQZDVPHDVXUHGXVLQJVWDQGDUGS+LQGLFDWRUVWULSVLQ 7KHS+RIWKHH[SRVXUHVROXWLRQZDVPHDVXUHGXVLQJVWDQGDUGS+LQGLFDWRUVWULSVLQ
VHUWHGWKURXJKWKHVFUHZFDSVRQWKHH[SRVXUHFRQWDLQHU,QWKHRQJRLQJH[SHULPHQWV VHUWHGWKURXJKWKHVFUHZFDSVRQWKHH[SRVXUHFRQWDLQHU,QWKHRQJRLQJH[SHULPHQWV
WKHS+PHDVXUHPHQWVZHUHSHUIRUPHGRQDZHHNO\EDVLVLQFRQQHFWLRQZLWKWKHµ6&(¶ WKHS+PHDVXUHPHQWVZHUHSHUIRUPHGRQDZHHNO\EDVLVLQFRQQHFWLRQZLWKWKHµ6&(¶
PDLQWHQDQFHDQGFDOLEUDWLRQ%RWKH[SRVXUHVROXWLRQV WKHµZZ¶FKORULGHH[SR PDLQWHQDQFHDQGFDOLEUDWLRQ%RWKH[SRVXUHVROXWLRQV WKHµZZ¶FKORULGHH[SR
VXUHVROXWLRQDQGWKHSRWDEOHZDWHU ZHUHUHSODFHGE\QHZVROXWLRQHYHU\ILYHZHHNV VXUHVROXWLRQDQGWKHSRWDEOHZDWHU ZHUHUHSODFHGE\QHZVROXWLRQHYHU\ILYHZHHNV
LQDFFRUGDQFHZLWK17%8,/'>)UHGHULNVHQ@RUZKHQWKHVROXWLRQS+ZDV LQDFFRUGDQFHZLWK17%8,/'>)UHGHULNVHQ@RUZKHQWKHVROXWLRQS+ZDV
PHDVXUHGWRH[FHHGHG FI6HFWLRQ ,IGHVLUHGS+VHQVLWLYHHOHFWURGHVFRXOG PHDVXUHGWRH[FHHGHG FI6HFWLRQ ,IGHVLUHGS+VHQVLWLYHHOHFWURGHVFRXOG
EHSHUPDQHQWO\PRXQWHGLQWKHDVVRFLDWHG H[WUDKROHVDQGFRQQHFWHGWRWKHUHVHUYHG EHSHUPDQHQWO\PRXQWHGLQWKHDVVRFLDWHG H[WUDKROHVDQGFRQQHFWHGWRWKHUHVHUYHG
FKDQQHOVRQWKHGLVWULEXWLRQWHUPLQDOERDUG FKDQQHOV  FI6HFWLRQVDQG FKDQQHOVRQWKHGLVWULEXWLRQWHUPLQDOERDUG FKDQQHOV  FI6HFWLRQVDQG
 7KHVDPHLVWUXHIRULRQVHOHFWLYHRUFKORULGHHOHFWURGHV7KHH[SRVXUHVROXWLRQ  7KHVDPHLVWUXHIRULRQVHOHFWLYHRUFKORULGHHOHFWURGHV7KHH[SRVXUHVROXWLRQ
DQG DLU WHPSHUDWXUHV DV ZHOO DV WKH YROWDJH OHYHOV RI WKH DPPHWHUEDWWHULHVDUHDXWR DQG DLU WHPSHUDWXUHV DV ZHOO DV WKH YROWDJH OHYHOV RI WKH DPPHWHUEDWWHULHVDUHDXWR
PDWLFDOO\PRQLWRUHGE\WKHGDWDORJJHUFRQWUROURXWLQH PDWLFDOO\PRQLWRUHGE\WKHGDWDORJJHUFRQWUROURXWLQH
7KH VWDQGDUG SOXJ FRQQHFWRU RQ HDFK VSHFLPHQ DOORZHG FRQQHFWLRQ WR YLUWXDOO\ DQ\ 7KH VWDQGDUG SOXJ FRQQHFWRU RQ HDFK VSHFLPHQ DOORZHG FRQQHFWLRQ WR YLUWXDOO\ DQ\
NLQGRIHOHFWURFKHPLFDO PHDVXUHPHQW HTXLSPHQW FI 6HFWLRQ   7KH RQO\ UHTXLUH NLQGRIHOHFWURFKHPLFDO PHDVXUHPHQW HTXLSPHQW FI 6HFWLRQ   7KH RQO\ UHTXLUH
PHQWZDVWKHDSSURSULDWHDGDSWHU FI6HFWLRQ 0HDVXUHPHQWVFRXOGEHPDGHLQ PHQWZDVWKHDSSURSULDWHDGDSWHU FI6HFWLRQ 0HDVXUHPHQWVFRXOGEHPDGHLQ
FRQQHFWLRQZLWKWKHµ((:V¶RUH[WHUQDOHOHFWURGHVSRVLWLRQHGLQWKHDVVRFLDWHGH[WUD FRQQHFWLRQZLWKWKHµ((:V¶RUH[WHUQDOHOHFWURGHVSRVLWLRQHGLQWKHDVVRFLDWHGH[WUD
KROHV FI6HFWLRQV  KROHV FI6HFWLRQV 
7KH GHVLJQ EDVHG RQ YDULRXV VPDOOVL]HG VSHFLPHQV DOORZHG VHOHFWLRQ RI LQGLYLGXDO 7KH GHVLJQ EDVHG RQ YDULRXV VPDOOVL]HG VSHFLPHQV DOORZHG VHOHFWLRQ RI LQGLYLGXDO
VSHFLPHQVIRUGHVWUXFWLYHWHVWLQJEDVHGRQµ/20¶µ6(0¶RUµ('6¶DQDO\VHVRURWKHU VSHFLPHQVIRUGHVWUXFWLYHWHVWLQJEDVHGRQµ/20¶µ6(0¶RUµ('6¶DQDO\VHVRURWKHU
WHFKQLTXHVHJWHVWLQJRIWKHPRUWDUS+E\SKHQROSKWKDOHLQVROXWLRQRUUDLQERZLQGL WHFKQLTXHVHJWHVWLQJRIWKHPRUWDUS+E\SKHQROSKWKDOHLQVROXWLRQRUUDLQERZLQGL
FDWRURUWHVWLQJRIWKHFKORULGHFRQWHQWE\WKHFRORXUWHVW FI6HFWLRQ 7KHIUHH FDWRURUWHVWLQJRIWKHFKORULGHFRQWHQWE\WKHFRORXUWHVW FI6HFWLRQ 7KHIUHH
VSHFLPHQ SRVLWLRQ FRXOG WKHQ EH XVHG IRU D QHZ VSHFLPHQ RU FORVHG ZLWK D UXEEHU VSHFLPHQ SRVLWLRQ FRXOG WKHQ EH XVHG IRU D QHZ VSHFLPHQ RU FORVHG ZLWK D UXEEHU
VWRSSHUWRNHHSWKHH[SRVXUHV\VWHPFORVHG VWRSSHUWRNHHSWKHH[SRVXUHV\VWHPFORVHG
 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 

 &RQFOXVLRQVDQG5HFRPPHQGDWLRQV  &RQFOXVLRQVDQG5HFRPPHQGDWLRQV
([LVWLQJNQRZOHGJHRQDTXHRXVFRUURVLRQDQGUHLQIRUFHGFRQFUHWH &KDSWHUVDQG  ([LVWLQJNQRZOHGJHRQDTXHRXVFRUURVLRQDQGUHLQIRUFHGFRQFUHWH &KDSWHUVDQG 
ZDVH[WHQGHGWRDQGDSSOLHGIRU ZDVH[WHQGHGWRDQGDSSOLHGIRU
‡ $WKHUPRG\QDPLFDOO\FRQVLVWHQWGHVFULSWLRQRIUHLQIRUFHPHQWFRUURVLRQ &KDSWHUV ‡ $WKHUPRG\QDPLFDOO\FRQVLVWHQWGHVFULSWLRQRIUHLQIRUFHPHQWFRUURVLRQ &KDSWHUV
DQG  DQG 
‡ 7KHHYDOXDWLRQRIDYDLODEOHFRUURVLRQFRXQWHUPHDVXUHV &KDSWHU  ‡ 7KHHYDOXDWLRQRIDYDLODEOHFRUURVLRQFRXQWHUPHDVXUHV &KDSWHU 
‡ 7KH HVWDEOLVKPHQW RI D GHVLJQ DSSURDFK IRU QHZ FRUURVLRQ FRXQWHUPHDVXUHV ‡ 7KH HVWDEOLVKPHQW RI D GHVLJQ DSSURDFK IRU QHZ FRUURVLRQ FRXQWHUPHDVXUHV
&KDSWHU  &KDSWHU 
‡ 7KHFRQFHSWXDOGHVLJQRIWZRQHZFRUURVLRQFRXQWHUPHDVXUHV &KDSWHU  ‡ 7KHFRQFHSWXDOGHVLJQRIWZRQHZFRUURVLRQFRXQWHUPHDVXUHV &KDSWHU 
‡ 7KH GHYHORSPHQW RI VXLWDEOH WHVW VHWXSV DQG WKH DGDSWDWLRQ RI H[LVWLQJ PHDVXUH ‡ 7KH GHYHORSPHQW RI VXLWDEOH WHVW VHWXSV DQG WKH DGDSWDWLRQ RI H[LVWLQJ PHDVXUH
PHQWPRQLWRULQJIRUFRQFOXVLYHSHUIRUPDQFHHYDOXDWLRQ &KDSWHU  PHQWPRQLWRULQJIRUFRQFOXVLYHSHUIRUPDQFHHYDOXDWLRQ &KDSWHU 
%ULHIVXPPDULHVRIWKHFRQWHQWVRIDOO&KDSWHUVZHUHJLYHQLQ6HFWLRQ7KHPRVW %ULHIVXPPDULHVRIWKHFRQWHQWVRIDOO&KDSWHUVZHUHJLYHQLQ6HFWLRQ7KHPRVW
LPSRUWDQWILQGLQJVRI&KDSWHUVWRDQGUHODWHGUHFRPPHQGDWLRQVIRUIXWXUHLQYHVWL LPSRUWDQWILQGLQJVRI&KDSWHUVWRDQGUHODWHGUHFRPPHQGDWLRQVIRUIXWXUHLQYHVWL
JDWLRQVDUHOLVWHGLQWKHIROORZLQJ JDWLRQVDUHOLVWHGLQWKHIROORZLQJ
‡ ³$SSOLFDWLRQRI7KHUPRG\QDPLFV´ &KDSWHU  ‡ ³$SSOLFDWLRQRI7KHUPRG\QDPLFV´ &KDSWHU 
7KHUPRG\QDPLFV FRQWUROV FRUURVLRQ WHQGHQFLHV D UHDFWLRQ GRHV QRW RFFXU LI 7KHUPRG\QDPLFV FRQWUROV FRUURVLRQ WHQGHQFLHV D UHDFWLRQ GRHV QRW RFFXU LI
WKHUPRG\QDPLFDOO\ LPSRVVLEOH *LYHQ WKDW DOO GHWHUPLQLQJ SDUDPHWHUV DUH WDNHQ WKHUPRG\QDPLFDOO\ LPSRVVLEOH *LYHQ WKDW DOO GHWHUPLQLQJ SDUDPHWHUV DUH WDNHQ
LQWR DFFRXQW D WKHUPRG\QDPLF PRGHO LQGLFDWHV KRZ FRQGLWLRQV FDQ EH PDQLSX LQWR DFFRXQW D WKHUPRG\QDPLF PRGHO LQGLFDWHV KRZ FRQGLWLRQV FDQ EH PDQLSX
ODWHGWRPDNHFRUURVLRQ WKHUPRG\QDPLFDOO\ LPSRVVLEOH7KXVDSSURSULDWHPRG ODWHGWRPDNHFRUURVLRQ WKHUPRG\QDPLFDOO\ LPSRVVLEOH7KXVDSSURSULDWHPRG
HOVFDQEHDSSOLHGIRUWKHHYDOXDWLRQRIDYDLODEOHDQGWKHGHVLJQRIQHZFRXQWHU HOVFDQEHDSSOLHGIRUWKHHYDOXDWLRQRIDYDLODEOHDQGWKHGHVLJQRIQHZFRXQWHU
PHDVXUHV PHDVXUHV
,PPXQLW\LVDGHILQLWHLQKHUHQWHOHFWURFKHPLFDOSURSHUW\RIDFHUWDLQPHWDOLQDQ ,PPXQLW\LVDGHILQLWHLQKHUHQWHOHFWURFKHPLFDOSURSHUW\RIDFHUWDLQPHWDOLQDQ
DTXHRXVVROXWLRQ EDVHGRQDJLYHQLRQDFWLYLW\ ZKHUHDVSDVVLYDWLRQDQGGHSDV DTXHRXVVROXWLRQ EDVHGRQDJLYHQLRQDFWLYLW\ ZKHUHDVSDVVLYDWLRQDQGGHSDV
VLYDWLRQ GHSHQG RQ ERWK WKHUPRG\QDPLF DQG NLQHWLF IDFWRUV 7KH SUHVHOHFWLRQ RI VLYDWLRQ GHSHQG RQ ERWK WKHUPRG\QDPLF DQG NLQHWLF IDFWRUV 7KH SUHVHOHFWLRQ RI
HOHPHQWVDQGWKHFKRLFHRILRQDFWLYLWLHVDUHWKHFUXFLDOSDUDPHWHUVIRUWKHHVWDE HOHPHQWVDQGWKHFKRLFHRILRQDFWLYLWLHVDUHWKHFUXFLDOSDUDPHWHUVIRUWKHHVWDE
OLVKPHQWRIUHSUHVHQWDWLYH3RXUEDL[GLDJUDPV OLVKPHQWRIUHSUHVHQWDWLYH3RXUEDL[GLDJUDPV
:H KDYH GHULYHG DQG VXJJHVWHG D GHVLJQ SURFHGXUH IRU 3RXUEDL[ GLDJUDPV %\ :H KDYH GHULYHG DQG VXJJHVWHG D GHVLJQ SURFHGXUH IRU 3RXUEDL[ GLDJUDPV %\
PHDQVRIWKLVSURFHGXUHLWLVQRWRQO\SRVVLEOHWRHVWDEOLVK3RXUEDL[GLDJUDPVIRU PHDQVRIWKLVSURFHGXUHLWLVQRWRQO\SRVVLEOHWRHVWDEOLVK3RXUEDL[GLDJUDPVIRU
V\VWHPV WKDW FDQ EH UHSUHVHQWHG E\ VLQJOH HOHPHQWV EXW DOVR IRU V\VWHPV ZKHUH V\VWHPV WKDW FDQ EH UHSUHVHQWHG E\ VLQJOH HOHPHQWV EXW DOVR IRU V\VWHPV ZKHUH
IRUPDWLRQRIFRPSRXQGVEHWZHHQGLIIHUHQWHOHPHQWVPXVWEHWDNHQLQWRDFFRXQW,I IRUPDWLRQRIFRPSRXQGVEHWZHHQGLIIHUHQWHOHPHQWVPXVWEHWDNHQLQWRDFFRXQW,I
DOO UHTXLUHG WKHUPRG\QDPLF GDWD LV DYDLODEOH PXOWLHOHPHQW 3RXUEDL[ GLDJUDPV DOO UHTXLUHG WKHUPRG\QDPLF GDWD LV DYDLODEOH PXOWLHOHPHQW 3RXUEDL[ GLDJUDPV
FDQEHHVWDEOLVKHGWRUHSUHVHQWDQ\HOHFWURFKHPLFDOV\VWHP7KLVDSSURDFKLVDOVR FDQEHHVWDEOLVKHGWRUHSUHVHQWDQ\HOHFWURFKHPLFDOV\VWHP7KLVDSSURDFKLVDOVR
YDOLG IRU PHWDOV LQ FRPELQDWLRQ ZLWK VXEVWDQFHV IRUPLQJ VROXEOH FRPSRXQGV D YDOLG IRU PHWDOV LQ FRPELQDWLRQ ZLWK VXEVWDQFHV IRUPLQJ VROXEOH FRPSRXQGV D
FDVHZKLFKLVJHQHUDOO\H[FOXGHGIURP3RXUEDL[GLDJUDPVLQWKHOLWHUDWXUH7KXVLW FDVHZKLFKLVJHQHUDOO\H[FOXGHGIURP3RXUEDL[GLDJUDPVLQWKHOLWHUDWXUH7KXVLW
LVDOVRSRVVLEOHWRREWDLQLQIRUPDWLRQRQFRPSOH[FKHPLFDOV\VWHPVHJFRUURVLRQ LVDOVRSRVVLEOHWRREWDLQLQIRUPDWLRQRQFRPSOH[FKHPLFDOV\VWHPVHJFRUURVLRQ
SURSDJDWLRQLQFKORULGHFRQWDPLQDWHGFRQFUHWH SURSDJDWLRQLQFKORULGHFRQWDPLQDWHGFRQFUHWH

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


&RQFOXVLRQVDQG5HFRPPHQGDWLRQV &RQFOXVLRQVDQG5HFRPPHQGDWLRQV

&RQFOXVLRQVUHJDUGLQJWKHFRUURVLRQWHQGHQFLHVFDQRQO\EHGUDZQXSRQ3RXUEDL[ &RQFOXVLRQVUHJDUGLQJWKHFRUURVLRQWHQGHQFLHVFDQRQO\EHGUDZQXSRQ3RXUEDL[
GLDJUDPVWKDWUHIOHFWWKHWKHUPRG\QDPLFVRIWKHV\VWHPRWKHUZLVHWKHGLDJUDPV GLDJUDPVWKDWUHIOHFWWKHWKHUPRG\QDPLFVRIWKHV\VWHPRWKHUZLVHWKHGLDJUDPV
DUHPHDQLQJOHVV DUHPHDQLQJOHVV
$VDQLPSRUWDQWIXWXUHWDVNZHVXJJHVWWKHHVWDEOLVKPHQWRIDFRPSOHWHWKHUPRG\ $VDQLPSRUWDQWIXWXUHWDVNZHVXJJHVWWKHHVWDEOLVKPHQWRIDFRPSOHWHWKHUPRG\
QDPLFGDWDEDVHIRUPHWDOVLQFRQFUHWH7KLVGDWDEDVHVKRXOGDOVRDFFRXQWIRUPLQ QDPLFGDWDEDVHIRUPHWDOVLQFRQFUHWH7KLVGDWDEDVHVKRXOGDOVRDFFRXQWIRUPLQ
HUDODGGLWLRQVDQGFKHPLFDODGPL[WXUHVVLQFHWKHVHIDFWRUVKDYHDVLJQLILFDQWLQ HUDODGGLWLRQVDQGFKHPLFDODGPL[WXUHVVLQFHWKHVHIDFWRUVKDYHDVLJQLILFDQWLQ
IOXHQFHRQWKHIRUPDWLRQRIVSHFLHV IOXHQFHRQWKHIRUPDWLRQRIVSHFLHV
‡ ³7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ´ &KDSWHU  ‡ ³7KHUPRG\QDPLFVRI5HLQIRUFHPHQW&RUURVLRQ´ &KDSWHU 
9DULRXV UHDFWLRQ PHFKDQLVPV SRVWXODWHG LQ WKH OLWHUDWXUH DUH SDUWO\ HUURQHRXV RU 9DULRXV UHDFWLRQ PHFKDQLVPV SRVWXODWHG LQ WKH OLWHUDWXUH DUH SDUWO\ HUURQHRXV RU
LQFRPSOHWHIURPDWKHUPRG\QDPLFSHUVSHFWLYH$OWHUQDWLYHFRQVLVWHQWGHVFULSWLRQV LQFRPSOHWHIURPDWKHUPRG\QDPLFSHUVSHFWLYH$OWHUQDWLYHFRQVLVWHQWGHVFULSWLRQV
EDVHG 3RXUEDL[ GLDJUDPV DQG UHDFWLRQ PHFKDQLVPV ZHUH SURSRVHG LQ WKLV WKHVLV EDVHG 3RXUEDL[ GLDJUDPV DQG UHDFWLRQ PHFKDQLVPV ZHUH SURSRVHG LQ WKLV WKHVLV
7KHSDVVLYHVWDWHDQGWKHLPPXQHVWDWHKDYHEHHQGHDOWZLWKUDWKHUEULHIO\ZKLOH 7KHSDVVLYHVWDWHDQGWKHLPPXQHVWDWHKDYHEHHQGHDOWZLWKUDWKHUEULHIO\ZKLOH
DFWLYH FRUURVLRQ ZDV GHVFULEHG LQ GHWDLO IRU WZR VLWXDWLRQV FDUERQDWLRQ LQGXFHG DFWLYH FRUURVLRQ ZDV GHVFULEHG LQ GHWDLO IRU WZR VLWXDWLRQV FDUERQDWLRQ LQGXFHG
FRUURVLRQ LQ R[\JHQULFK FRQFUHWH DQG FKORULGH LQGXFHG FRUURVLRQ LQ R[\JHQ FRUURVLRQ LQ R[\JHQULFK FRQFUHWH DQG FKORULGH LQGXFHG FRUURVLRQ LQ R[\JHQ
GHSULYHGFRQFUHWH GHSULYHGFRQFUHWH
,WZDVGHPRQVWUDWHGWKDWFDUERQDWLRQLQGXFHGFRUURVLRQFDQEHIXOO\ DVVHVVHGE\ ,WZDVGHPRQVWUDWHGWKDWFDUERQDWLRQLQGXFHGFRUURVLRQFDQEHIXOO\ DVVHVVHGE\
WKHUPRG\QDPLF PRGHOV )RU FKORULGH LQGXFHG FRUURVLRQ RQO\ SURSDJDWLRQ FDQ EH WKHUPRG\QDPLF PRGHOV )RU FKORULGH LQGXFHG FRUURVLRQ RQO\ SURSDJDWLRQ FDQ EH
GHVFULEHGWKHUPRG\QDPLFDOO\ZKHUHDVWKHLQLWLDWLRQVWDJHLVODUJHO\JRYHUQHGE\ GHVFULEHGWKHUPRG\QDPLFDOO\ZKHUHDVWKHLQLWLDWLRQVWDJHLVODUJHO\JRYHUQHGE\
NLQHWLF SDUDPHWHUV $ PHFKDQLVP IRU WKH SURSDJDWLRQ VWDJH RI FKORULGH LQGXFHG NLQHWLF SDUDPHWHUV $ PHFKDQLVP IRU WKH SURSDJDWLRQ VWDJH RI FKORULGH LQGXFHG
ZDVSURSRVHG7KLVPHFKDQLVPLVEDVHGRQDVHOIFRQWDLQHGORRSEHWZHHQR[LGD ZDVSURSRVHG7KLVPHFKDQLVPLVEDVHGRQDVHOIFRQWDLQHGORRSEHWZHHQR[LGD
WLRQ RI IHUURXV LRQ WR IHUULF FKORULGH DQG WKH HWFKLQJ DFWLRQ RI IHUULF FKORULGH RQ WLRQ RI IHUURXV LRQ WR IHUULF FKORULGH DQG WKH HWFKLQJ DFWLRQ RI IHUULF FKORULGH RQ
LURQ$QDVVRFLDWHGS+GHFUHDVHDQGSRUHEORFNLQJFRQILQHDFLGLILHGSDWKZD\VLQ LURQ$QDVVRFLDWHGS+GHFUHDVHDQGSRUHEORFNLQJFRQILQHDFLGLILHGSDWKZD\VLQ
WKHFRQFUHWHEXON7KLV PHFKDQLVP ZDV VXVWDLQHGE\ RZQ H[SHULPHQWDO REVHUYD WKHFRQFUHWHEXON7KLV PHFKDQLVPZDVVXVWDLQHGE\RZQH[SHULPHQWDO REVHUYD
WLRQV DQG IRXQG LQ JRRG DJUHHPHQW ZLWK FRUURVLRQSKHQRPHQD REVHUYHG LQSUDF WLRQV DQG IRXQG LQ JRRG DJUHHPHQW ZLWK FRUURVLRQSKHQRPHQD REVHUYHG LQSUDF
WLFH WLFH
3URWHFWLRQPHFKDQLVPVFDQEHGHULYHGDQGGHVFULEHGVLPLODUO\DVFRUURVLRQSURF 3URWHFWLRQPHFKDQLVPVFDQEHGHULYHGDQGGHVFULEHGVLPLODUO\DVFRUURVLRQSURF
HVVHV6XFKGHVFULSWLRQVPXVWEHEDVHGRQH[WHQVLYHH[SHULPHQWDOLQYHVWLJDWLRQV HVVHV6XFKGHVFULSWLRQVPXVWEHEDVHGRQH[WHQVLYHH[SHULPHQWDOLQYHVWLJDWLRQV
PXFKIXWXUHUHVHDUFKLVUHTXLUHGZLWKUHIHUHQFHWRWKDW PXFKIXWXUHUHVHDUFKLVUHTXLUHGZLWKUHIHUHQFHWRWKDW
‡ ³$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV´ &KDSWHU  ‡ ³$YDLODEOH&RUURVLRQ&RXQWHUPHDVXUHV´ &KDSWHU 
6WDWHRIWKHDUWGXUDELOLW\GHVLJQDQGDYDLODEOHFRUURVLRQFRXQWHUPHDVXUHVIRUQHZ 6WDWHRIWKHDUWGXUDELOLW\GHVLJQDQGDYDLODEOHFRUURVLRQFRXQWHUPHDVXUHVIRUQHZ
DQGH[LVWLQJVWUXFWXUHVZHUHGLVFXVVHG,WZDVUHDVRQHGDQGH[HPSOLILHGWKDWPDQ\ DQGH[LVWLQJVWUXFWXUHVZHUHGLVFXVVHG,WZDVUHDVRQHGDQGH[HPSOLILHGWKDWPDQ\
RIWKHDYDLODEOHFRUURVLRQFRXQWHUPHDVXUHVDUHQRWHIIHFWLYHVRPHGLVSOD\HGGHIL RIWKHDYDLODEOHFRUURVLRQFRXQWHUPHDVXUHVDUHQRWHIIHFWLYHVRPHGLVSOD\HGGHIL
FLHQFLHV IURP D WKHUPRG\QDPLF SRLQW RI YLHZ 2WKHU FRXQWHUPHDVXUHV ZHUH GH FLHQFLHV IURP D WKHUPRG\QDPLF SRLQW RI YLHZ 2WKHU FRXQWHUPHDVXUHV ZHUH GH
WHUPLQHG WR EH HIIHFWLYH HJ VWDLQOHVV VWHHO DQG FDWKRGLF SUHYHQWLRQSURWHFWLRQ WHUPLQHG WR EH HIIHFWLYH HJ VWDLQOHVV VWHHO DQG FDWKRGLF SUHYHQWLRQSURWHFWLRQ
+RZHYHU LW ZDV H[HPSOLILHG WKDW WKHVH DYDLODEOH HIIHFWLYH PHDVXUHV DUH QRW DO +RZHYHU LW ZDV H[HPSOLILHG WKDW WKHVH DYDLODEOH HIIHFWLYH PHDVXUHV DUH QRW DO
ZD\VDSSOLFDEOHIRUHFRQRPLFDOSUDFWLFDORUWHFKQLFDOUHDVRQV ZD\VDSSOLFDEOHIRUHFRQRPLFDOSUDFWLFDORUWHFKQLFDOUHDVRQV
:HFRQFOXGHGWKDWQHZHIIHFWLYHDQGLQSDUWLFXODUFRVWHIILFLHQWFRXQWHUPHDVXUHV :HFRQFOXGHGWKDWQHZHIIHFWLYHDQGLQSDUWLFXODUFRVWHIILFLHQWFRXQWHUPHDVXUHV
IRUQHZDQGH[LVWLQJVWUXFWXUHVDUHVWLOOLQGHPDQG7KHUHIRUHWKHPRVWLPSRUWDQW IRUQHZDQGH[LVWLQJVWUXFWXUHVDUHVWLOOLQGHPDQG7KHUHIRUHWKHPRVWLPSRUWDQW
UHFRPPHQGDWLRQVIRUIXWXUHLQYHVWLJDWLRQVUHODWHWRWKHGHYHORSPHQWRIQHZFRXQ UHFRPPHQGDWLRQVIRUIXWXUHLQYHVWLJDWLRQVUHODWHWRWKHGHYHORSPHQWRIQHZFRXQ

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 &RQFOXVLRQVDQG5HFRPPHQGDWLRQV  &RQFOXVLRQVDQG5HFRPPHQGDWLRQV

WHUPHDVXUHV0RUHRYHUZHUHFRPPHQGIXUWKHUGRFXPHQWDWLRQRIWKHDYDLODEOHHI WHUPHDVXUHV0RUHRYHUZHUHFRPPHQGIXUWKHUGRFXPHQWDWLRQRIWKHDYDLODEOHHI
IHFWLYH FRXQWHUPHDVXUHV HJ FRUURVLRQ SHUIRUPDQFH RI VWDLQOHVV VWHHO ZHOGV DQG IHFWLYH FRXQWHUPHDVXUHV HJ FRUURVLRQ SHUIRUPDQFH RI VWDLQOHVV VWHHO ZHOGV DQG
FDWKRGLFSUHYHQWLRQSURWHFWLRQRIKLJKVWUHQJWKVWHHOV FDWKRGLFSUHYHQWLRQSURWHFWLRQRIKLJKVWUHQJWKVWHHOV
‡ ³'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV´ &KDSWHU  ‡ ³'HVLJQRI&RUURVLRQ&RXQWHUPHDVXUHV´ &KDSWHU 
5HTXLUHPHQWVIRUQHZ FRXQWHUPHDVXUHVZHUHIRUPXODWHGEDVHGRQWKHWKHUPRG\ 5HTXLUHPHQWVIRUQHZ FRXQWHUPHDVXUHVZHUHIRUPXODWHGEDVHGRQWKHWKHUPRG\
QDPLFGHVFULSWLRQRIUHLQIRUFHPHQWFRUURVLRQDVZHOODVRQWKHHYDOXDWLRQRIDYDLO QDPLFGHVFULSWLRQRIUHLQIRUFHPHQWFRUURVLRQDVZHOODVRQWKHHYDOXDWLRQRIDYDLO
DEOHFRXQWHUPHDVXUHV DEOHFRXQWHUPHDVXUHV
7ZR SULQFLSOHV RI LPSOHPHQWDWLRQ ZHUH GHULYHG WR IXOILO WKH IRUPXODWHG UHTXLUH 7ZR SULQFLSOHV RI LPSOHPHQWDWLRQ ZHUH GHULYHG WR IXOILO WKH IRUPXODWHG UHTXLUH
PHQWV7KHVHSULQFLSOHVDUHDSSOLFDEOHIRUERWKQHZVWUXFWXUHVDQGUHSDLURIH[LVW PHQWV7KHVHSULQFLSOHVDUHDSSOLFDEOHIRUERWKQHZVWUXFWXUHVDQGUHSDLURIH[LVW
LQJVWUXFWXUHV7KH\DUHH[SHFWHGWRVLJQLILFDQWO\LPSURYHWKHFRUURVLRQSURWHFWLRQ LQJVWUXFWXUHV7KH\DUHH[SHFWHGWRVLJQLILFDQWO\LPSURYHWKHFRUURVLRQSURWHFWLRQ
RIFDUERQVWHHOUHLQIRUFHPHQWLQFRQWDPLQDWHGDQGFUDFNHG XSWRDFHUWDLQFUDFN RIFDUERQVWHHOUHLQIRUFHPHQWLQFRQWDPLQDWHGDQGFUDFNHG XSWRDFHUWDLQFUDFN
ZLGWK FRQFUHWH ZLGWK FRQFUHWH
%RWKSULQFLSOHVDLPDWREWDLQLQJWDUJHWHGORZFRUURVLRQSRWHQWLDOV7KHPDWHULDOV %RWKSULQFLSOHVDLPDWREWDLQLQJWDUJHWHGORZFRUURVLRQSRWHQWLDOV7KHPDWHULDOV
FRQFHSWRIWKHILUVWSULQFLSOHRILPSOHPHQWDWLRQDOVRHQDEOHVFRQFUHWHVWHHOLQWHU FRQFHSWRIWKHILUVWSULQFLSOHRILPSOHPHQWDWLRQDOVRHQDEOHVFRQFUHWHVWHHOLQWHU
IDFHLPSURYHPHQWE\HOHFWURFKHPLFDOGHQVLILFDWLRQGXULQJWKHVHWWLQJRIFRQFUHWH IDFHLPSURYHPHQWE\HOHFWURFKHPLFDOGHQVLILFDWLRQGXULQJWKHVHWWLQJRIFRQFUHWH
DQG IRUPDWLRQ RI SRUHEORFNHUV DW ODWHU VWDJHV 7KHVH DFWLRQV DUH LPPRELOLVHG LQ DQG IRUPDWLRQ RI SRUHEORFNHUV DW ODWHU VWDJHV 7KHVH DFWLRQV DUH LPPRELOLVHG LQ
WKHPDWHULDOVFRQFHSWIRUWKHVHFRQGSULQFLSOHZKLFKDLPVDWDKLJKFXUUHQW\LHOG WKHPDWHULDOVFRQFHSWIRUWKHVHFRQGSULQFLSOHZKLFKDLPVDWDKLJKFXUUHQW\LHOG
IRUHIIHFWLYHFDWKRGLFSURWHFWLRQRIWKHFDUERQVWHHOUHLQIRUFHPHQW IRUHIIHFWLYHFDWKRGLFSURWHFWLRQRIWKHFDUERQVWHHOUHLQIRUFHPHQW
7KHPDWHULDOVFRQFHSWVHPSOR\PDJQHVLXPDQG]LQFLQFRPELQDWLRQZLWKVXSSOH 7KHPDWHULDOVFRQFHSWVHPSOR\PDJQHVLXPDQG]LQFLQFRPELQDWLRQZLWKVXSSOH
PHQWDU\ HOHFWURFKHPLFDOO\ DFWLYH FRPSRXQGV 7KH SULQFLSOH VSHFLILF IHDWXUHV DUH PHQWDU\ HOHFWURFKHPLFDOO\ DFWLYH FRPSRXQGV 7KH SULQFLSOH VSHFLILF IHDWXUHV DUH
DFKLHYHGE\ WDLORUHGSURSRUWLRQLQJ RI WKH LPSOHPHQWHG PDWHULDOVDQG FXVWRPLVHG DFKLHYHGE\ WDLORUHGSURSRUWLRQLQJ RI WKH LPSOHPHQWHG PDWHULDOVDQG FXVWRPLVHG
SURGXFWLRQSURFHVVHV%\PHDQVRIWKHVHVROXWLRQVFDUERQVWHHOUHLQIRUFHPHQWFDQ SURGXFWLRQSURFHVVHV%\PHDQVRIWKHVHVROXWLRQVFDUERQVWHHOUHLQIRUFHPHQWFDQ
EH RSHUDWHG DW WDUJHWHG DQG ORQJWHUP VWDEOH ORZ FRUURVLRQ SRWHQWLDOV ZKLOH K\ EH RSHUDWHG DW WDUJHWHG DQG ORQJWHUP VWDEOH ORZ FRUURVLRQ SRWHQWLDOV ZKLOH K\
GURJHQHYROXWLRQRUDQ\RWKHUXQGHVLUHGLQWHUIHUHQFHEHWZHHQWKHLQWURGXFHGPD GURJHQHYROXWLRQRUDQ\RWKHUXQGHVLUHGLQWHUIHUHQFHEHWZHHQWKHLQWURGXFHGPD
WHULDOVFRQFHSWVDQGWKHFRQFUHWHVWHHOV\VWHPDUHSUHYHQWHG WHULDOVFRQFHSWVDQGWKHFRQFUHWHVWHHOV\VWHPDUHSUHYHQWHG
7KHFRQFHSWVDQGWKHLULPSOHPHQWDWLRQSULQFLSOHVDUHWKHFHQWUDOREMHFWLYHRIWKLV 7KHFRQFHSWVDQGWKHLULPSOHPHQWDWLRQSULQFLSOHVDUHWKHFHQWUDOREMHFWLYHRIWKLV
WKHVLV+RZHYHUGXHWRH[SHFWHGSDWHQWSRVVLELOLWLHVRQO\OLPLWHGLQIRUPDWLRQRQ WKHVLV+RZHYHUGXHWRH[SHFWHGSDWHQWSRVVLELOLWLHVRQO\OLPLWHGLQIRUPDWLRQRQ
WKHFRQFHSWVLVSURYLGHG WKHFRQFHSWVLVSURYLGHG
,QJHQHUDOWKLVWKHVLVFRYHUVDYHU\HDUO\VWDJHRIWKHGHYHORSPHQWRIQHZFRUUR ,QJHQHUDOWKLVWKHVLVFRYHUVDYHU\HDUO\VWDJHRIWKHGHYHORSPHQWRIQHZFRUUR
VLRQFRXQWHUPHDVXUHV0XFKIXUWKHULQYHVWLJDWLRQLVUHTXLUHGEHIRUH WKH FRXQWHU VLRQFRXQWHUPHDVXUHV0XFKIXUWKHULQYHVWLJDWLRQLVUHTXLUHGEHIRUH WKH FRXQWHU
PHDVXUHVFDQEHLPSOHPHQWHGDQGWHVWHGRQDVWUXFWXUDOVFDOH7KHPRVWLPPHGL PHDVXUHVFDQEHLPSOHPHQWHGDQGWHVWHGRQDVWUXFWXUDOVFDOH7KHPRVWLPPHGL
DWHLQYHVWLJDWLRQVFRQFHUQWKH ILQHWXQLQJRIWKH SURGXFWLRQSURFHVVHVRI WKHWZR DWHLQYHVWLJDWLRQVFRQFHUQWKH ILQHWXQLQJRIWKH SURGXFWLRQSURFHVVHVRI WKHWZR
SURSRVHGSULQFLSOHV0RUHRYHUWKHSHUIRUPDQFHRIWKLQ]LQFIHUULWHOD\HUVZKLFK SURSRVHGSULQFLSOHV0RUHRYHUWKHSHUIRUPDQFHRIWKLQ]LQFIHUULWHOD\HUVZKLFK
ZHUHSURSRVHGDVDOWHUQDWLYHFRVWHIIHFWLYHPHDVXUHVDJDLQVWFDUERQDWLRQLQGXFHG ZHUHSURSRVHGDVDOWHUQDWLYHFRVWHIIHFWLYHPHDVXUHVDJDLQVWFDUERQDWLRQLQGXFHG
FRUURVLRQVKRXOGEHIXUWKHUHYDOXDWHG FRUURVLRQVKRXOGEHIXUWKHUHYDOXDWHG
‡ ³7HVW6HWXSDQG0HDVXULQJ0HWKRGV´ &KDSWHU  ‡ ³7HVW6HWXSDQG0HDVXULQJ0HWKRGV´ &KDSWHU 
$ VHWXS IRU FRPSUHKHQVLYH WHVWLQJ ZDV GHYHORSHG LQ RUGHU WR HYDOXDWH WKH SHU $ VHWXS IRU FRPSUHKHQVLYH WHVWLQJ ZDV GHYHORSHG LQ RUGHU WR HYDOXDWH WKH SHU
IRUPDQFHRIWKHSURSRVHGQHZFRXQWHUPHDVXUHVEDVHGRQPXOWLSOHVSHFLPHQV,QL IRUPDQFHRIWKHSURSRVHGQHZFRXQWHUPHDVXUHVEDVHGRQPXOWLSOHVSHFLPHQV,QL

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 


&RQFOXVLRQVDQG5HFRPPHQGDWLRQV &RQFOXVLRQVDQG5HFRPPHQGDWLRQV

WLDOWHVWVRIWKHILUVWSULQFLSOHRILPSOHPHQWDWLRQ VXUIDFHPRGLILFDWLRQV ZHUHXQ WLDOWHVWVRIWKHILUVWSULQFLSOHRILPSOHPHQWDWLRQ VXUIDFHPRGLILFDWLRQV ZHUHXQ


GHUWDNHQLQWKLVVHWXS GHUWDNHQLQWKLVVHWXS
7KH ILUVWSULQFLSOH RI LPSOHPHQWDWLRQ ZDV WHVWHG DJDLQVW DYDLODEOH FRUURVLRQSUR 7KH ILUVWSULQFLSOH RI LPSOHPHQWDWLRQ ZDV WHVWHG DJDLQVW DYDLODEOH FRUURVLRQSUR
WHFWLRQ PHDVXUHV 7HVWLQJ ZDV SHUIRUPHG E\ LQVWUXPHQWHG PRUWDU VSHFLPHQV DV WHFWLRQ PHDVXUHV 7HVWLQJ ZDV SHUIRUPHG E\ LQVWUXPHQWHG PRUWDU VSHFLPHQV DV
ZHOO DV VLPSOH PRUWDU DQG FHPHQW SDVWH VSHFLPHQV 7KH LQVWUXPHQWHG PRUWDU ZHOO DV VLPSOH PRUWDU DQG FHPHQW SDVWH VSHFLPHQV 7KH LQVWUXPHQWHG PRUWDU
VSHFLPHQV ZHUH HTXLSSHG ZLWK HPEHGGHG HOHFWURGHV 7KLV DOORZHG IRU REWDLQLQJ VSHFLPHQV ZHUH HTXLSSHG ZLWK HPEHGGHG HOHFWURGHV 7KLV DOORZHG IRU REWDLQLQJ
LQIRUPDWLRQRQFKDQJHV DWWKHPHWDOVXUIDFHDQGDWWKHPRUWDUPHWDOLQWHUIDFHDV LQIRUPDWLRQRQFKDQJHV DWWKHPHWDOVXUIDFHDQGDWWKHPRUWDUPHWDO LQWHUIDFHDV
ZHOODVRQFRQGXFWLYLW\R[\JHQFRQWHQWDQGRWKHUUHOHYDQWSDUDPHWHUVRIWKHPRU ZHOODVRQFRQGXFWLYLW\R[\JHQFRQWHQWDQGRWKHUUHOHYDQWSDUDPHWHUVRIWKHPRU
WDUEXON7KHVLPSOHPRUWDUDQGWKHFHPHQWSDVWHVSHFLPHQV ZHUHXVHG DVUHIHU WDUEXON7KHVLPSOHPRUWDUDQGWKHFHPHQWSDVWHVSHFLPHQV ZHUH XVHG DVUHIHU
HQFH VSHFLPHQV ZKLFK DLPHG DW LQYHVWLJDWLQJ WKH WKHUPRG\QDPLF FRQGLWLRQV RI HQFH VSHFLPHQV ZKLFK DLPHG DW LQYHVWLJDWLQJ WKH WKHUPRG\QDPLF FRQGLWLRQV RI
WKHHPEHGGHGPHWDOVXUIDFHRQO\ WKHHPEHGGHGPHWDOVXUIDFHRQO\
7KHVSHFLPHQVZHUHWHVWHGLQDKLJKFDSDFLW\H[SRVXUHVHWXSDQGPRQLWRUHGE\DQ 7KHVSHFLPHQVZHUHWHVWHGLQDKLJKFDSDFLW\H[SRVXUHVHWXSDQGPRQLWRUHGE\DQ
DXWRPDWHGV\VWHPZKLFKDOORZHGIRUPRQLWRULQJRIPXOWLSOHVSHFLPHQVE\PHDQV DXWRPDWHGV\VWHPZKLFKDOORZHGIRUPRQLWRULQJRIPXOWLSOHVSHFLPHQVE\PHDQV
RIFOXVWHUPHDVXUHPHQWV,QWKHILQDOFRQILJXUDWLRQVSHFLPHQVFRXOGEHPRQL RIFOXVWHUPHDVXUHPHQWV,QWKHILQDOFRQILJXUDWLRQVSHFLPHQVFRXOGEHPRQL
WRUHGZLWKFKDQQHOVHDFK7KHPRQLWRULQJZDVSHUIRUPHGE\DFRPELQDWLRQRI WRUHGZLWKFKDQQHOVHDFK7KHPRQLWRULQJZDVSHUIRUPHGE\DFRPELQDWLRQRI
FRQWLQXRXV FRUURVLRQ SRWHQWLDO DQG PDFURFHOO FXUUHQW PHDVXUHPHQWV 7KHVH ZHUH FRQWLQXRXV FRUURVLRQ SRWHQWLDO DQG PDFURFHOO FXUUHQW PHDVXUHPHQWV 7KHVH ZHUH
VXSSOHPHQWHG E\ IUHTXHQW HOHFWURFKHPLFDO LPSHGDQFH VSHFWURVFRS\ XVLQJ WKH LQ VXSSOHPHQWHG E\ IUHTXHQW HOHFWURFKHPLFDO LPSHGDQFH VSHFWURVFRS\ XVLQJ WKH LQ
VWUXPHQWHG PRUWDU VSHFLPHQV 0RUHRYHU GHVWUXFWLYH PHDVXUHPHQWV HJ DQRGLF VWUXPHQWHG PRUWDU VSHFLPHQV 0RUHRYHU GHVWUXFWLYH PHDVXUHPHQWV HJ DQRGLF
SRODULVDWLRQFXUYHVZHUHSHUIRUPHGXVLQJDODUJHTXDQWLW\RIFHPHQWSDVWHVSHFL SRODULVDWLRQFXUYHVZHUHSHUIRUPHGXVLQJDODUJHTXDQWLW\RIFHPHQWSDVWHVSHFL
PHQV&KHPLFDODQDO\VHVRIHJS+DOWHUDWLRQDQGFKORULGHFRQWHQWDVZHOODVPL PHQV&KHPLFDODQDO\VHVRIHJS+DOWHUDWLRQDQGFKORULGHFRQWHQWDVZHOODVPL
FURVFRSLFDQG;UD\DQDO\VHVZHUHXVHGWRREWDLQGDWDIRUDFRPSUHKHQVLYHWKHU FURVFRSLFDQG;UD\DQDO\VHVZHUHXVHGWRREWDLQGDWDIRUDFRPSUHKHQVLYHWKHU
PRG\QDPLFSHUIRUPDQFHHYDOXDWLRQ PRG\QDPLFSHUIRUPDQFHHYDOXDWLRQ
7KH VHWXS DQG WHVW PHWKRGV ZLOO EH DSSOLHG LQ WKH LQYHVWLJDWLRQV FRQFHUQLQJ WKH 7KH VHWXS DQG WHVW PHWKRGV ZLOO EH DSSOLHG LQ WKH LQYHVWLJDWLRQV FRQFHUQLQJ WKH
IXUWKHU GHYHORSPHQW RI WKH SURSRVHG QHZ FRXQWHUPHDVXUHV :H FRQVLGHU WKH LQ IXUWKHU GHYHORSPHQW RI WKH SURSRVHG QHZ FRXQWHUPHDVXUHV :H FRQVLGHU WKH LQ
IRUPDWLRQ WKDW FDQ EH REWDLQHG IURP WKH DSSOLHG HOHFWURFKHPLFDO PHWKRGV WR EH IRUPDWLRQ WKDW FDQ EH REWDLQHG IURP WKH DSSOLHG HOHFWURFKHPLFDO PHWKRGV WR EH
DGHTXDWHIRUWKHSODQQHGLQYHVWLJDWLRQV:LWKUHJDUGWRPLFURVFRSLFDQGFKHPLFDO DGHTXDWHIRUWKHSODQQHGLQYHVWLJDWLRQV:LWKUHJDUGWRPLFURVFRSLFDQGFKHPLFDO
DQDO\VHVH[SDQVLRQRIWKHDSSOLHGWHFKQLTXHVWRVDPSOHSUHSDUDWLRQDQGDQDO\VHV DQDO\VHVH[SDQVLRQRIWKHDSSOLHGWHFKQLTXHVWRVDPSOHSUHSDUDWLRQDQGDQDO\VHV
LQ DQ LQHUW DWPRVSKHUH DUH DGGLWLRQDO REMHFWLYHV RI IXWXUH LQYHVWLJDWLRQV 0RUH LQ DQ LQHUW DWPRVSKHUH DUH DGGLWLRQDO REMHFWLYHV RI IXWXUH LQYHVWLJDWLRQV 0RUH
RYHULWLVSODQQHGWRDGYDQFHWKHFRQFHSWRIWKHLQVWUXPHQWHGPRUWDUVSHFLPHQVLQ RYHULWLVSODQQHGWRDGYDQFHWKHFRQFHSWRIWKHLQVWUXPHQWHGPRUWDUVSHFLPHQVLQ
FRPELQDWLRQ ZLWK WKH DSSOLHG HOHFWURFKHPLFDO PHWKRGV WRZDUGV FRPSUHKHQVLYH FRPELQDWLRQ ZLWK WKH DSSOLHG HOHFWURFKHPLFDO PHWKRGV WRZDUGV FRPSUHKHQVLYH
HPEHGGDEOHFRUURVLRQVHQVRUV7KHVHDGYDQFHPHQWVUHODWHSULPDULO\WRWKHVHFRQG HPEHGGDEOHFRUURVLRQVHQVRUV7KHVHDGYDQFHPHQWVUHODWHSULPDULO\WRWKHVHFRQG
SULQFLSOHRILPSOHPHQWDWLRQE\PHDQVRIFRQFUHWHVSDFHUVLHWRWKHHVWDEOLVKPHQW SULQFLSOHRILPSOHPHQWDWLRQE\PHDQVRIFRQFUHWHVSDFHUVLHWRWKHHVWDEOLVKPHQW
RID³VPDUWVSDFHU´VROXWLRQ RID³VPDUWVSDFHU´VROXWLRQ
 

 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN  'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 

/LVWRI5HIHUHQFHV /LVWRI5HIHUHQFHV
>$EX$\DQDHWDO@$EX$\DQD<0(O6DZ\60 6DODK6+  µ=LQFIHUULWH >$EX$\DQDHWDO@$EX$\DQD<0(O6DZ\60 6DODK6+  µ=LQFIHUULWH
SLJPHQWIRUFRUURVLRQSURWHFWLRQ¶$QWL&RUURVLRQ0HWKRGVDQG0DWHULDOV  SS± SLJPHQWIRUFRUURVLRQSURWHFWLRQ¶$QWL&RUURVLRQ0HWKRGVDQG0DWHULDOV  SS±
>$&,5@$&,5  &HPHQWDQG&RQFUHWH7HUPLQRORJ\5HSRUW5 >$&,5@$&,5  &HPHQWDQG&RQFUHWH7HUPLQRORJ\5HSRUW5
5HDSSURYHG $PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS 5HDSSURYHG $PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS
>$&,5@$&,5  *XLGHWR'XUDEOH&RQFUHWH5HSRUW5$PHULFDQ >$&,5@$&,5  *XLGHWR'XUDEOH&RQFUHWH5HSRUW5$PHULFDQ
&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS &RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS
>$&,5@$&,5  3URWHFWLRQRI0HWDOVLQ&RQFUHWH$JDLQVW&RUURVLRQ5HSRUW >$&,5@$&,5  3URWHFWLRQRI0HWDOVLQ&RQFUHWH$JDLQVW&RUURVLRQ5HSRUW
5$PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS 5$PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS
>$&,5@$&,5  &DXVHV(YDOXDWLRQDQG5HSDLURI&UDFNVLQ&RQFUHWH >$&,5@$&,5  &DXVHV(YDOXDWLRQDQG5HSDLURI&UDFNVLQ&RQFUHWH
6WUXFWXUHV5HSRUW5$PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS 6WUXFWXUHV5HSRUW5$PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS
>$&,5@$&,5  &RQWURORI&UDFNLQJLQ&RQFUHWH6WUXFWXUHV5HSRUW5 >$&,5@$&,5  &RQWURORI&UDFNLQJLQ&RQFUHWH6WUXFWXUHV5HSRUW5
$PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS $PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS
>$&,0@$&,0  0HWULF6SHFLILFDWLRQVIRU6WUXFWXUDO&RQFUHWH5HSRUW0 >$&,0@$&,0  0HWULF6SHFLILFDWLRQVIRU6WUXFWXUDO&RQFUHWH5HSRUW0
$PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS $PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS
>$&,050@$&,050  0HWULF%XLOGLQJ&RGH5HTXLUHPHQWVIRU >$&,050@$&,050  0HWULF%XLOGLQJ&RGH5HTXLUHPHQWVIRU
6WUXFWXUDO&RQFUHWHDQG&RPPHQWDU\6WDQGDUGDQGFRPPHQWDU\050$PHULFDQ 6WUXFWXUDO&RQFUHWHDQG&RPPHQWDU\6WDQGDUGDQGFRPPHQWDU\050$PHULFDQ
&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS &RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS
>$&,5@$&,5  *XLGHIRUWKH'HVLJQDQG&RQVWUXFWLRQRI)L[HG2IIVKRUH >$&,5@$&,5  *XLGHIRUWKH'HVLJQDQG&RQVWUXFWLRQRI)L[HG2IIVKRUH
&RQFUHWH6WUXFWXUHV5HSRUW5 5HDSSURYHG $PHULFDQ&RQFUHWH,QVWLWXWH $&,  &RQFUHWH6WUXFWXUHV5HSRUW5 5HDSSURYHG $PHULFDQ&RQFUHWH,QVWLWXWH $&, 
)DUPLQJWRQ+LOOV0,86$SS )DUPLQJWRQ+LOOV0,86$SS
>$&,5@$&,5  *XLGHIRUWKH'HVLJQRI'XUDEOH3DUNLQJ6WUXFWXUHV5HSRUW >$&,5@$&,5  *XLGHIRUWKH'HVLJQRI'XUDEOH3DUNLQJ6WUXFWXUHV5HSRUW
5 5HDSSURYHG $PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS 5 5HDSSURYHG $PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS
>$&,5@$&,5  *XLGHWR4XDOLW\&RQWURODQG7HVWLQJRI+LJK6WUHQJWK >$&,5@$&,5  *XLGHWR4XDOLW\&RQWURODQG7HVWLQJRI+LJK6WUHQJWK
&RQFUHWH5HSRUW5$PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS &RQFUHWH5HSRUW5$PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS
>$&,5@$&,5  6WDWHRIWKH$UW5HSRUWRQ+LJK6WUHQJWK&RQFUHWH5HSRUW >$&,5@$&,5  6WDWHRIWKH$UW5HSRUWRQ+LJK6WUHQJWK&RQFUHWH5HSRUW
5 5HDSSURYHG $PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS 5 5HDSSURYHG $PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS
>$&,5@$&,5  6HUYLFH/LIH3UHGLFWLRQ6WDWHRIWKH$UW5HSRUW5HSRUW >$&,5@$&,5  6HUYLFH/LIH3UHGLFWLRQ6WDWHRIWKH$UW5HSRUW5HSRUW
5$PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS 5$PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS
>$&,5@$&,5  *XLGHIRUWKH'HVLJQDQG&RQVWUXFWLRQRI&RQFUHWH >$&,5@$&,5  *XLGHIRUWKH'HVLJQDQG&RQVWUXFWLRQRI&RQFUHWH
5HLQIRUFHGZLWK)53%DUV5HSRUW5$PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV 5HLQIRUFHGZLWK)53%DUV5HSRUW5$PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV
0,86$SS 0,86$SS
>$&,5@$&,5  *XLGHWRWKH8VHRI:DWHUSURRILQJ'DPSSURRILQJ >$&,5@$&,5  *XLGHWRWKH8VHRI:DWHUSURRILQJ'DPSSURRILQJ
3URWHFWLYHDQG'HFRUDWLYH%DUULHU6\VWHPVIRU&RQFUHWH5HSRUW5 5HDSSURYHG  3URWHFWLYHDQG'HFRUDWLYH%DUULHU6\VWHPVIRU&RQFUHWH5HSRUW5 5HDSSURYHG 
$PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS $PHULFDQ&RQFUHWH,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS
>$&,5@$&,5  &RQFUHWH5HSDLU*XLGH5HSRUW5$PHULFDQ&RQFUHWH >$&,5@$&,5  &RQFUHWH5HSDLU*XLGH5HSRUW5$PHULFDQ&RQFUHWH
,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS ,QVWLWXWH $&, )DUPLQJWRQ+LOOV0,86$SS
>$&,HWDO@$&,HWDO  &RQFUHWH5HSDLU0DQXDO&ROOHFWLRQ5301$PHULFDQ >$&,HWDO@$&,HWDO  &RQFUHWH5HSDLU0DQXDO&ROOHFWLRQ5301$PHULFDQ
&RQFUHWH,QVWLWXWH $&, $PHULFDQ6RFLHW\RI&LYLO(QJLQHHUV $6&( %XLOGLQJ5HVHDUFK &RQFUHWH,QVWLWXWH $&, $PHULFDQ6RFLHW\RI&LYLO(QJLQHHUV $6&( %XLOGLQJ5HVHDUFK
(VWDEOLVKPHQW %5( &RQVWUXFWLRQ5HVHDUFK&RPPXQLFDWLRQV &5& &RQFUHWH6RFLHW\ &6  (VWDEOLVKPHQW %5( &RQVWUXFWLRQ5HVHDUFK&RPPXQLFDWLRQV &5& &RQFUHWH6RFLHW\ &6 
,QWHUQDWLRQDO&RQFUHWH5HSDLU,QVWLWXWH ,&5, 1$&(,QWHUQDWLRQDO7KH6RFLHW\IRU3URWHFWLYH ,QWHUQDWLRQDO&RQFUHWH5HSDLU,QVWLWXWH ,&5, 1$&(,QWHUQDWLRQDO7KH6RFLHW\IRU3URWHFWLYH
&RDWLQJV 663& DQG8QLWHG6WDWHV$UP\&RUSVRI(QJLQHHUV 86$&( 86$DQG8.SS &RDWLQJV 663& DQG8QLWHG6WDWHV$UP\&RUSVRI(QJLQHHUV 86$&( 86$DQG8.SS
>$*$@$*$  +RW'LS*DOYDQL]LQJIRU&RUURVLRQ3UHYHQWLRQ$*XLGHWR6SHFLI\LQJ >$*$@$*$  +RW'LS*DOYDQL]LQJIRU&RUURVLRQ3UHYHQWLRQ$*XLGHWR6SHFLI\LQJ
DQG,QVSHFWLQJ+RW'LS*DOYDQL]HG5HLQIRUFLQJ6WHHO5HSRUW$PHULFDQ*DOYDQL]HUV$VVRFLDWLRQ DQG,QVSHFWLQJ+RW'LS*DOYDQL]HG5HLQIRUFLQJ6WHHO5HSRUW$PHULFDQ*DOYDQL]HUV$VVRFLDWLRQ
&HQWHQQLDO&286$SS$YDLODEOHRQOLQHKWWSZZZJDOYDQL]HGUHEDUFRPDFFHVVHG0D\ &HQWHQQLDO&286$SS$YDLODEOHRQOLQHKWWSZZZJDOYDQL]HGUHEDUFRPDFFHVVHG0D\
 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN , 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ,
/LVWRI5HIHUHQFHV /LVWRI5HIHUHQFHV

>$*$@$*$  &RUURVLRQ3HUIRUPDQFHRI*DOYDQL]HG6WHHOLQ&RQFUHWH$PHULFDQ >$*$@$*$  &RUURVLRQ3HUIRUPDQFHRI*DOYDQL]HG6WHHOLQ&RQFUHWH$PHULFDQ


*DOYDQL]HUV$VVRFLDWLRQ&HQWHQQLDO&286$:HEVLWHKWWSZZZJDOYDQL]HLWRUJDFFHVVHG *DOYDQL]HUV$VVRFLDWLRQ&HQWHQQLDO&286$:HEVLWHKWWSZZZJDOYDQL]HLWRUJDFFHVVHG
0D\ 0D\
>$OGHDHWDO@$OGHD&0*KDQGHKDUL06KDK63 .DUU$  µ(VWLPDWLRQRI >$OGHDHWDO@$OGHD&0*KDQGHKDUL06KDK63 .DUU$  µ(VWLPDWLRQRI
:DWHU)ORZWKURXJK&UDFNHG&RQFUHWHXQGHU/RDG¶$&,0DWHULDOV-RXUQDO  SS± :DWHU)ORZWKURXJK&UDFNHG&RQFUHWHXQGHU/RDG¶$&,0DWHULDOV-RXUQDO  SS±
>$OGHDHWDO@$OGHD&06KDK6 .DUU$  µ3HUPHDELOLW\RI&UDFNHG&RQFUHWH¶ >$OGHDHWDO@$OGHD&06KDK6 .DUU$  µ3HUPHDELOLW\RI&UDFNHG&RQFUHWH¶
0DWHULDOVDQG6WUXFWXUHVSS± 0DWHULDOVDQG6WUXFWXUHVSS±
>$ORQVRHWDO@$ORQVR&$QGUDGH&5RGULJXH]- 'LH]-0  µ)DFWRUV >$ORQVRHWDO@$ORQVR&$QGUDGH&5RGULJXH]- 'LH]-0  µ)DFWRUV
FRQWUROOLQJFUDFNLQJRIFRQFUHWHDIIHFWHGE\UHLQIRUFHPHQWFRUURVLRQ¶0DWHULDOVDQG6WUXFWXUHV FRQWUROOLQJFUDFNLQJRIFRQFUHWHDIIHFWHGE\UHLQIRUFHPHQWFRUURVLRQ¶0DWHULDOVDQG6WUXFWXUHV
  SS±   SS±
>$QGRU@$QGRU  5DPDQ6SHFWURVFRS\$SSOLFDWLRQQRWHV$QGRU7HFKQRORJ\%HOIDVW >$QGRU@$QGRU  5DPDQ6SHFWURVFRS\$SSOLFDWLRQQRWHV$QGRU7HFKQRORJ\%HOIDVW
8.SS 8.SS
>$QGUDGHHWDO@$QGUDGH&$ORQVR& 0ROLQD)  µ&RYHUFUDFNLQJDVDIXQFWLRQRI >$QGUDGHHWDO@$QGUDGH&$ORQVR& 0ROLQD)  µ&RYHUFUDFNLQJDVDIXQFWLRQRI
EDUFRUURVLRQ3DUW([SHULPHQWDOWHVW¶0DWHULDOVDQG6WUXFWXUHV  SS± EDUFRUURVLRQ3DUW([SHULPHQWDOWHVW¶0DWHULDOVDQG6WUXFWXUHV  SS±
>$QGUDGHHWDOD@$QGUDGH&0HULQR31RYRD;3HUH]0 6ROHU/ D  >$QGUDGHHWDOD@$QGUDGH&0HULQR31RYRD;3HUH]0 6ROHU/ D 
µ3DVVLYDWLRQRIUHLQIRUFLQJVWHHOLQFRQFUHWH¶0DWHULDOV6FLHQFH)RUXPSS± µ3DVVLYDWLRQRIUHLQIRUFLQJVWHHOLQFRQFUHWH¶0DWHULDOV6FLHQFH)RUXPSS±
>$QGUDGHHWDOE@$QGUDGH&6ROHU/$ORQVR&1RYRD;5 .HGGDP0 E  >$QGUDGHHWDOE@$QGUDGH&6ROHU/$ORQVR&1RYRD;5 .HGGDP0 E 
µ7KHLPSRUWDQFHRIJHRPHWULFDOFRQVLGHUDWLRQVLQWKHPHDVXUHPHQWVRIVWHHOFRUURVLRQLQFRQFUHWHE\ µ7KHLPSRUWDQFHRIJHRPHWULFDOFRQVLGHUDWLRQVLQWKHPHDVXUHPHQWVRIVWHHOFRUURVLRQLQFRQFUHWHE\
PHDQVRI$&LPSHGDQFH¶&RUURVLRQ6FLHQFH  SS± PHDQVRI$&LPSHGDQFH¶&RUURVLRQ6FLHQFH  SS±
>$QWXQHVHWDO@$QWXQHV5$&RVWD, )DULD'/$G  µ&KDUDFWHUL]DWLRQRI >$QWXQHVHWDO@$QWXQHV5$&RVWD, )DULD'/$G  µ&KDUDFWHUL]DWLRQRI
FRUURVLRQSURGXFWVIRUPHGRQVWHHOVLQWKHILUVWPRQWKVRIDWPRVSKHULFH[SRVXUH¶0DWHULDOV5HVHDUFK FRUURVLRQSURGXFWVIRUPHGRQVWHHOVLQWKHILUVWPRQWKVRIDWPRVSKHULFH[SRVXUH¶0DWHULDOV5HVHDUFK
SS± SS±
>$3$@$3$  3XEOLFDWLRQ0DQXDORIWKH$PHULFDQ3V\FKRORJLFDO$VVRFLDWLRQ >$3$@$3$  3XEOLFDWLRQ0DQXDORIWKH$PHULFDQ3V\FKRORJLFDO$VVRFLDWLRQ
:DVKLQJWRQ'&86$$PHULFDQ3V\FKRORJLFDO$VVRFLDWLRQWKHGLWLRQSS :DVKLQJWRQ'&86$$PHULFDQ3V\FKRORJLFDO$VVRFLDWLRQWKHGLWLRQSS
>$UXS@$UXS+  µ7KHPHFKDQLVPVRISURWHFWLRQRIVWHHOE\FRQFUHWH¶FKDSWHUSS >$UXS@$UXS+  µ7KHPHFKDQLVPVRISURWHFWLRQRIVWHHOE\FRQFUHWH¶FKDSWHUSS
±,Q&UDQH$3 (G &RUURVLRQRIUHLQIRUFHPHQWLQFRQFUHWHFRQVWUXFWLRQ&KLFKHVWHU ±,Q&UDQH$3 (G &RUURVLRQRIUHLQIRUFHPHQWLQFRQFUHWHFRQVWUXFWLRQ&KLFKHVWHU
(QJODQG+RUZRRG (QJODQG+RUZRRG
>$UXS 6¡UHQVHQ@$UXS+ 6¡UHQVHQ%  µ$QHZHPEHGGDEOHUHIHUHQFHHOHFWURGH >$UXS 6¡UHQVHQ@$UXS+ 6¡UHQVHQ%  µ$QHZHPEHGGDEOHUHIHUHQFHHOHFWURGH
IRUXVHLQFRQFUHWH¶SS±,Q3URFHHGLQJVRI&25526,211DVKYLOOH7186$ IRUXVHLQFRQFUHWH¶SS±,Q3URFHHGLQJVRI&25526,211DVKYLOOH7186$
>$UXS 6¡UHQVHQ@$UXS+ 6¡UHQVHQ+(  µ$SURSRVHGWHFKQLTXHIRUGHWHUPLQLQJ >$UXS 6¡UHQVHQ@$UXS+ 6¡UHQVHQ+(  µ$SURSRVHGWHFKQLTXHIRUGHWHUPLQLQJ
FKORULGHWKUHVKROGV¶SS±,Q3URFHHGLQJVRISUR&KORULGH3HQHWUDWLRQLQWR&RQFUHWH FKORULGHWKUHVKROGV¶SS±,Q3URFHHGLQJVRISUR&KORULGH3HQHWUDWLRQLQWR&RQFUHWH
,QWHUQDWLRQDO5,/(0:RUNVKRS6DLQW5pP\OqV&KHYUHXVH)UDQFH ,QWHUQDWLRQDO5,/(0:RUNVKRS6DLQW5pP\OqV&KHYUHXVH)UDQFH
>$670$0@$670$0  6WDQGDUG6SHFLILFDWLRQIRU'HIRUPHGDQG3ODLQ >$670$0@$670$0  6WDQGDUG6SHFLILFDWLRQIRU'HIRUPHGDQG3ODLQ
&DUERQ6WHHO%DUVIRU&RQFUHWH5HLQIRUFHPHQW'HVLJQDWLRQ$0$670,QWHUQDWLRQDO:HVW &DUERQ6WHHO%DUVIRU&RQFUHWH5HLQIRUFHPHQW'HVLJQDWLRQ$0$670,QWHUQDWLRQDO:HVW
&RQVKRKRFNHQ3$86$SS &RQVKRKRFNHQ3$86$SS
>$670$0@$670$0  6WDQGDUG6SHFLILFDWLRQIRU=LQF&RDWHG *DOYDQL]HG  >$670$0@$670$0  6WDQGDUG6SHFLILFDWLRQIRU=LQF&RDWHG *DOYDQL]HG 
6WHHO%DUVIRU&RQFUHWH5HLQIRUFHPHQW'HVLJQDWLRQ$0$670,QWHUQDWLRQDO:HVW 6WHHO%DUVIRU&RQFUHWH5HLQIRUFHPHQW'HVLJQDWLRQ$0$670,QWHUQDWLRQDO:HVW
&RQVKRKRFNHQ3$86$SS &RQVKRKRFNHQ3$86$SS
>$670$0@$670$0  6WDQGDUG6SHFLILFDWLRQIRU(SR[\&RDWHG6WHHO >$670$0@$670$0  6WDQGDUG6SHFLILFDWLRQIRU(SR[\&RDWHG6WHHO
5HLQIRUFLQJ%DUV'HVLJQDWLRQ$0D$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$ 5HLQIRUFLQJ%DUV'HVLJQDWLRQ$0D$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$
SS SS
>$670$0@$670$0  6WDQGDUG6SHFLILFDWLRQIRU(SR[\&RDWHG >$670$0@$670$0  6WDQGDUG6SHFLILFDWLRQIRU(SR[\&RDWHG
3UHIDEULFDWHG6WHHO5HLQIRUFLQJ%DUV'HVLJQDWLRQ$0$670,QWHUQDWLRQDO:HVW 3UHIDEULFDWHG6WHHO5HLQIRUFLQJ%DUV'HVLJQDWLRQ$0$670,QWHUQDWLRQDO:HVW
&RQVKRKRFNHQ3$86$SS &RQVKRKRFNHQ3$86$SS
>$670$@$670$  6WDQGDUG7HVW0HWKRGIRU&RPSDULQJ%RQG6WUHQJWKRI >$670$@$670$  6WDQGDUG7HVW0HWKRGIRU&RPSDULQJ%RQG6WUHQJWKRI
6WHHO5HLQIRUFLQJ%DUVWR&RQFUHWH8VLQJ%HDP(QG6SHFLPHQV'HVLJQDWLRQ$$670 6WHHO5HLQIRUFLQJ%DUVWR&RQFUHWH8VLQJ%HDP(QG6SHFLPHQV'HVLJQDWLRQ$$670
,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS ,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS
>$670$0@$670$0  6WDQGDUG6SHFLILFDWLRQIRU'HIRUPHGDQG3ODLQ >$670$0@$670$0  6WDQGDUG6SHFLILFDWLRQIRU'HIRUPHGDQG3ODLQ
6WDLQOHVV%DUVIRU&RQFUHWH5HLQIRUFHPHQW'HVLJQDWLRQ$0D$670,QWHUQDWLRQDO:HVW 6WDLQOHVV%DUVIRU&RQFUHWH5HLQIRUFHPHQW'HVLJQDWLRQ$0D$670,QWHUQDWLRQDO:HVW
&RQVKRKRFNHQ3$86$SS &RQVKRKRFNHQ3$86$SS

,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 /LVWRI5HIHUHQFHV  /LVWRI5HIHUHQFHV

>$670%@$670%  6WDQGDUG3UDFWLFHIRU2SHUDWLQJ6DOW6SUD\ )RJ  >$670%@$670%  6WDQGDUG3UDFWLFHIRU2SHUDWLQJ6DOW6SUD\ )RJ 


$SSDUDWXV'HVLJQDWLRQ%$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS $SSDUDWXV'HVLJQDWLRQ%$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS
>$670%@$670%  6WDQGDUG*XLGHIRU&OHDQLQJ0HWDOV3ULRUWR >$670%@$670%  6WDQGDUG*XLGHIRU&OHDQLQJ0HWDOV3ULRUWR
(OHFWURSODWLQJ'HVLJQDWLRQ% 5HDSSURYHG $670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ (OHFWURSODWLQJ'HVLJQDWLRQ% 5HDSSURYHG $670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ
3$86$SS 3$86$SS
>$670&@$670&  6WDQGDUG3HUIRUPDQFH6SHFLILFDWLRQIRU+\GUDXOLF >$670&@$670&  6WDQGDUG3HUIRUPDQFH6SHFLILFDWLRQIRU+\GUDXOLF
&HPHQW'HVLJQDWLRQ&$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS &HPHQW'HVLJQDWLRQ&$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS
>$670&@$670&  6WDQGDUG6SHFLILFDWLRQIRU6LOLFD)XPH8VHGLQ >$670&@$670&  6WDQGDUG6SHFLILFDWLRQIRU6LOLFD)XPH8VHGLQ
&HPHQWLWLRXV0L[WXUHV'HVLJQDWLRQ&$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$ &HPHQWLWLRXV0L[WXUHV'HVLJQDWLRQ&$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$
SS SS
>$670&@$670&  7HUPLQRORJ\5HODWLQJWR&RQFUHWHDQG&RQFUHWH >$670&@$670&  7HUPLQRORJ\5HODWLQJWR&RQFUHWHDQG&RQFUHWH
$JJUHJDWHV'HVLJQDWLRQ&$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS $JJUHJDWHV'HVLJQDWLRQ&$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS
>$670&@$670&  6WDQGDUG6SHFLILFDWLRQIRU3RUWODQG&HPHQW'HVLJQDWLRQ >$670&@$670&  6WDQGDUG6SHFLILFDWLRQIRU3RUWODQG&HPHQW'HVLJQDWLRQ
&$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS &$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS
>$670&0@$670&0  6WDQGDUG6SHFLILFDWLRQIRU0L[LQJ:DWHU8VHGLQ >$670&0@$670&0  6WDQGDUG6SHFLILFDWLRQIRU0L[LQJ:DWHU8VHGLQ
WKH3URGXFWLRQRI+\GUDXOLF&HPHQW&RQFUHWH'HVLJQDWLRQ&0$670,QWHUQDWLRQDO:HVW WKH3URGXFWLRQRI+\GUDXOLF&HPHQW&RQFUHWH'HVLJQDWLRQ&0$670,QWHUQDWLRQDO:HVW
&RQVKRKRFNHQ3$86$SS &RQVKRKRFNHQ3$86$SS
>$670&@$670&  6WDQGDUG6SHFLILFDWLRQIRU&RQFUHWH$JJUHJDWHV >$670&@$670&  6WDQGDUG6SHFLILFDWLRQIRU&RQFUHWH$JJUHJDWHV
'HVLJQDWLRQ&$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS 'HVLJQDWLRQ&$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS
>$670&0@$670&0  6SHFLILFDWLRQIRU&KHPLFDO$GPL[WXUHVIRU&RQFUHWH >$670&0@$670&0  6SHFLILFDWLRQIRU&KHPLFDO$GPL[WXUHVIRU&RQFUHWH
'HVLJQDWLRQ&0D$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS 'HVLJQDWLRQ&0D$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS
>$670&@$670&  6WDQGDUG6SHFLILFDWLRQIRU%OHQGHG+\GUDXOLF&HPHQWV >$670&@$670&  6WDQGDUG6SHFLILFDWLRQIRU%OHQGHG+\GUDXOLF&HPHQWV
'HVLJQDWLRQ&$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS 'HVLJQDWLRQ&$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS
>$670&@$670&  6WDQGDUG6SHFLILFDWLRQIRU&RDO)O\$VKDQG5DZRU >$670&@$670&  6WDQGDUG6SHFLILFDWLRQIRU&RDO)O\$VKDQG5DZRU
&DOFLQHG1DWXUDO3R]]RODQIRU8VHLQ&RQFUHWH'HVLJQDWLRQ&$670,QWHUQDWLRQDO:HVW &DOFLQHG1DWXUDO3R]]RODQIRU8VHLQ&RQFUHWH'HVLJQDWLRQ&$670,QWHUQDWLRQDO:HVW
&RQVKRKRFNHQ3$86$SS &RQVKRKRFNHQ3$86$SS
>$670&@$670&  6WDQGDUG7HVW0HWKRGIRU+DOI&HOO3RWHQWLDOVRI >$670&@$670&  6WDQGDUG7HVW0HWKRGIRU+DOI&HOO3RWHQWLDOVRI
8QFRDWHG5HLQIRUFLQJ6WHHOLQ&RQFUHWH'HVLJQDWLRQ& 5HDSSURYHG $670 8QFRDWHG5HLQIRUFLQJ6WHHOLQ&RQFUHWH'HVLJQDWLRQ& 5HDSSURYHG $670
,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS ,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS
>$670&@$670&  6WDQGDUG6SHFLILFDWLRQIRU*URXQG*UDQXODWHG%ODVW >$670&@$670&  6WDQGDUG6SHFLILFDWLRQIRU*URXQG*UDQXODWHG%ODVW
)XUQDFH6ODJIRU8VHLQ&RQFUHWHDQG0RUWDUV'HVLJQDWLRQ&$670,QWHUQDWLRQDO:HVW )XUQDFH6ODJIRU8VHLQ&RQFUHWHDQG0RUWDUV'HVLJQDWLRQ&$670,QWHUQDWLRQDO:HVW
&RQVKRKRFNHQ3$86$SS &RQVKRKRFNHQ3$86$SS
>$670'6@$670'6  0HWDOVDQG$OOR\VLQWKH8QLILHG1XPEHULQJ6\VWHP >$670'6@$670'6  0HWDOVDQG$OOR\VLQWKH8QLILHG1XPEHULQJ6\VWHP
:HVW&RQVKRKRFNHQ3$86$$670,QWHUQDWLRQDOWKHGLWLRQSS :HVW&RQVKRKRFNHQ3$86$$670,QWHUQDWLRQDOWKHGLWLRQSS
>$670(@$670(  6WDQGDUG*XLGHIRU4XDQWLWDWLYH$QDO\VLVE\(QHUJ\ >$670(@$670(  6WDQGDUG*XLGHIRU4XDQWLWDWLYH$QDO\VLVE\(QHUJ\
'LVSHUVLYH6SHFWURVFRS\'HVLJQDWLRQ( 5HDSSURYHG $670,QWHUQDWLRQDO:HVW 'LVSHUVLYH6SHFWURVFRS\'HVLJQDWLRQ( 5HDSSURYHG $670,QWHUQDWLRQDO:HVW
&RQVKRKRFNHQ3$86$SS &RQVKRKRFNHQ3$86$SS
>$670(@$670(  6WDQGDUG7HVW0HWKRGVIRU5DWLQJDQG&ODVVLI\LQJ >$670(@$670(  6WDQGDUG7HVW0HWKRGVIRU5DWLQJDQG&ODVVLI\LQJ
,QFOXVLRQVLQ6WHHO8VLQJWKH6FDQQLQJ(OHFWURQ0LFURVFRSH'HVLJQDWLRQ($670 ,QFOXVLRQVLQ6WHHO8VLQJWKH6FDQQLQJ(OHFWURQ0LFURVFRSH'HVLJQDWLRQ($670
,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS ,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS
>$670*@$670*  6WDQGDUG3UDFWLFHIRU&DOFXODWLRQRI&RUURVLRQ5DWHVDQG >$670*@$670*  6WDQGDUG3UDFWLFHIRU&DOFXODWLRQRI&RUURVLRQ5DWHVDQG
5HODWHG,QIRUPDWLRQIURP(OHFWURFKHPLFDO0HDVXUHPHQWV'HVLJQDWLRQ*± 5HDSSURYHG  5HODWHG,QIRUPDWLRQIURP(OHFWURFKHPLFDO0HDVXUHPHQWV'HVLJQDWLRQ*± 5HDSSURYHG 
$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS $670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS
>$670*@$670*  6WDQGDUG3UDFWLFHIRU9HULILFDWLRQRI$OJRULWKPDQG >$670*@$670*  6WDQGDUG3UDFWLFHIRU9HULILFDWLRQRI$OJRULWKPDQG
(TXLSPHQWIRU(OHFWURFKHPLFDO,PSHGDQFH0HDVXUHPHQWV'HVLJQDWLRQ*± 5HDSSURYHG  (TXLSPHQWIRU(OHFWURFKHPLFDO,PSHGDQFH0HDVXUHPHQWV'HVLJQDWLRQ*± 5HDSSURYHG 
$670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS $670,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS
>$670*@$670*  6WDQGDUG7HVW0HWKRGIRU'HWHUPLQLQJWKH(IIHFWVRI >$670*@$670*  6WDQGDUG7HVW0HWKRGIRU'HWHUPLQLQJWKH(IIHFWVRI
&KHPLFDO$GPL[WXUHVRQWKH&RUURVLRQRI(PEHGGHG6WHHO5HLQIRUFHPHQWLQ&RQFUHWH([SRVHGWR &KHPLFDO$GPL[WXUHVRQWKH&RUURVLRQRI(PEHGGHG6WHHO5HLQIRUFHPHQWLQ&RQFUHWH([SRVHGWR
&KORULGH(QYLURQPHQWV'HVLJQDWLRQ*D 5HDSSURYHG $670,QWHUQDWLRQDO:HVW &KORULGH(QYLURQPHQWV'HVLJQDWLRQ*D 5HDSSURYHG $670,QWHUQDWLRQDO:HVW
&RQVKRKRFNHQ3$86$SS &RQVKRKRFNHQ3$86$SS

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ,,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ,,,


/LVWRI5HIHUHQFHV /LVWRI5HIHUHQFHV

>$670*@$670*  6WDQGDUG3UDFWLFHIRU&RQYHQWLRQV$SSOLFDEOHWR >$670*@$670*  6WDQGDUG3UDFWLFHIRU&RQYHQWLRQV$SSOLFDEOHWR


(OHFWURFKHPLFDO0HDVXUHPHQWVLQ&RUURVLRQ7HVWLQJ'HVLJQDWLRQ* 5HDSSURYHG $670 (OHFWURFKHPLFDO0HDVXUHPHQWVLQ&RUURVLRQ7HVWLQJ'HVLJQDWLRQ* 5HDSSURYHG $670
,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS ,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS
>$670*@$670*  6WDQGDUG5HIHUHQFH7HVW0HWKRGIRU0DNLQJ3RWHQWLRVWDWLFDQG >$670*@$670*  6WDQGDUG5HIHUHQFH7HVW0HWKRGIRU0DNLQJ3RWHQWLRVWDWLFDQG
3RWHQWLRG\QDPLF$QRGLF3RODUL]DWLRQ0HDVXUHPHQWV'HVLJQDWLRQ* 5HDSSURYHG $670 3RWHQWLRG\QDPLF$QRGLF3RODUL]DWLRQ0HDVXUHPHQWV'HVLJQDWLRQ* 5HDSSURYHG $670
,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS ,QWHUQDWLRQDO:HVW&RQVKRKRFNHQ3$86$SS
>$670*@$670*  6WDQGDUG7HVW0HWKRGIRU&RQGXFWLQJ3RWHQWLRG\QDPLF >$670*@$670*  6WDQGDUG7HVW0HWKRGIRU&RQGXFWLQJ3RWHQWLRG\QDPLF
3RODUL]DWLRQ5HVLVWDQFH0HDVXUHPHQWV'HVLJQDWLRQ* 5HDSSURYHG $670,QWHUQDWLRQDO 3RODUL]DWLRQ5HVLVWDQFH0HDVXUHPHQWV'HVLJQDWLRQ* 5HDSSURYHG $670,QWHUQDWLRQDO
:HVW&RQVKRKRFNHQ3$86$SS :HVW&RQVKRKRFNHQ3$86$SS
>$XGHQDHUWHWDO@$XGHQDHUW.0DUVDYLQD/ 6FKXWWHU*G  7UDQVSRUW >$XGHQDHUWHWDO@$XGHQDHUW.0DUVDYLQD/ 6FKXWWHU*G  7UDQVSRUW
0HFKDQLVPVLQ&UDFNHG&RQFUHWH/HXYHQ%HOJLXP$FFRVWHGLWLRQSS 0HFKDQLVPVLQ&UDFNHG&RQFUHWH/HXYHQ%HOJLXP$FFRVWHGLWLRQSS
>$XWR/DE@$XWR/DE  (OHFWURFKHPLFDO,PSHGDQFH6SHFWURVFRS\ (,6 %DVLF >$XWR/DE@$XWR/DE  (OHFWURFKHPLFDO,PSHGDQFH6SHFWURVFRS\ (,6 %DVLF
3ULQFLSOHV$SSOLFDWLRQQRWH$XWR/DE8WUHFKW7KH1HWKHUODQGV$YDLODEOHRQOLQH 3ULQFLSOHV$SSOLFDWLRQQRWH$XWR/DE8WUHFKW7KH1HWKHUODQGV$YDLODEOHRQOLQH
KWWSZZZHFRFKHPLHQODFFHVVHG0DUSS KWWSZZZHFRFKHPLHQODFFHVVHG0DUSS
>%DNHU@%DNHU($  µ0DULQH&RUURVLRQ%HKDYLRURI%DUHDQG0HWDOOLF±&RDWHG >%DNHU@%DNHU($  µ0DULQH&RUURVLRQ%HKDYLRURI%DUHDQG0HWDOOLF±&RDWHG
5HLQIRUFLQJ5RGVLQ&RQFUHWH¶SS±,Q7RQLQL'('HDQ6:- (G &KORULGH&RUURVLRQ 5HLQIRUFLQJ5RGVLQ&RQFUHWH¶SS±,Q7RQLQL'('HDQ6:- (G &KORULGH&RUURVLRQ
2I6WHHO,Q&RQFUHWH1XPEHU$670673:HVW&RQVKRKRFNHQ3$86$$670,QWHUQDWLRQDO 2I6WHHO,Q&RQFUHWH1XPEHU$670673:HVW&RQVKRKRFNHQ3$86$$670,QWHUQDWLRQDO
>%DUGDO@%DUGDO(  &RUURVLRQDQG3URWHFWLRQ(QJLQHHULQJ0DWHULDOVDQG3URFHVVHV >%DUGDO@%DUGDO(  &RUURVLRQDQG3URWHFWLRQ(QJLQHHULQJ0DWHULDOVDQG3URFHVVHV
/RQGRQ8.6SULQJHUVWHGLWLRQSS /RQGRQ8.6SULQJHUVWHGLWLRQSS
>%DULQ@%DULQ,  7KHUPRG\QDPLFDO'DWDRI3XUH6XEVWDQFHV3DUWDQG3DUW >%DULQ@%DULQ,  7KHUPRG\QDPLFDO'DWDRI3XUH6XEVWDQFHV3DUWDQG3DUW
:HLQKHLP*HUPDQ\9&+QGHGLWLRQSS :HLQKHLP*HUPDQ\9&+QGHGLWLRQSS
>%HQWXUHWDO@%HQWXU$'LDPRQG6 %HUNH16  6WHHO&RUURVLRQLQ&RQFUHWH >%HQWXUHWDO@%HQWXU$'LDPRQG6 %HUNH16  6WHHO&RUURVLRQLQ&RQFUHWH
)XQGDPHQWDOVDQG&LYLO(QJLQHHULQJ3UDFWLFH1XPEHULQ0RGHUQ&RQFUHWH7HFKQRORJ\/RQGRQ )XQGDPHQWDOVDQG&LYLO(QJLQHHULQJ3UDFWLFH1XPEHULQ0RGHUQ&RQFUHWH7HFKQRORJ\/RQGRQ
8.( )16SRQ &KDSPDQ +DOO VWHGLWLRQSS 8.( )16SRQ &KDSPDQ +DOO VWHGLWLRQSS
>%HQW]HWDO@%HQW]'*HLNHU0 +DQVHQ.  µ6KULQNDJHUHGXFLQJDGPL[WXUHVDQG >%HQW]HWDO@%HQW]'*HLNHU0 +DQVHQ.  µ6KULQNDJHUHGXFLQJDGPL[WXUHVDQG
HDUO\DJHGHVLFFDWLRQLQFHPHQWSDVWHVDQGPRUWDUV¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS± HDUO\DJHGHVLFFDWLRQLQFHPHQWSDVWHVDQGPRUWDUV¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS±
 
>%HUNH +LFNV@%HUNH16 +LFNV0&  µ(OHFWURFKHPLFDO0HWKRGVRI >%HUNH +LFNV@%HUNH16 +LFNV0&  µ(OHFWURFKHPLFDO0HWKRGVRI
'HWHUPLQLQJWKH&RUURVLYLW\RI6WHHOLQ&RQFUHWH¶SS±,Q%DERLDQ5 'HDQ6KHOGRQ 'HWHUPLQLQJWKH&RUURVLYLW\RI6WHHOLQ&RQFUHWH¶SS±,Q%DERLDQ5 'HDQ6KHOGRQ
: (GV &RUURVLRQ7HVWLQJDQG(YDOXDWLRQ6LOYHU$QQLYHUVDU\9ROXPH1XPEHU$670673 : (GV &RUURVLRQ7HVWLQJDQG(YDOXDWLRQ6LOYHU$QQLYHUVDU\9ROXPH1XPEHU$670673
:HVW&RQVKRKRFNHQ3$86$$670,QWHUQDWLRQDO :HVW&RQVKRKRFNHQ3$86$$670,QWHUQDWLRQDO
>%HUNH +LFNV@%HUNH16 +LFNV0&  µ(VWLPDWLQJWKH/LIH&\FOHRI5HLQIRUFHG >%HUNH +LFNV@%HUNH16 +LFNV0&  µ(VWLPDWLQJWKH/LIH&\FOHRI5HLQIRUFHG
&RQFUHWH'HFNVDQG0DULQH3LOHV8VLQJ/DERUDWRU\'LIIXVLRQDQG&RUURVLRQ'DWD¶SS±,Q &RQFUHWH'HFNVDQG0DULQH3LOHV8VLQJ/DERUDWRU\'LIIXVLRQDQG&RUURVLRQ'DWD¶SS±,Q
&KDNHU9 (G &RUURVLRQ)RUPVDQG&RQWUROIRU,QIUDVWUXFWXUH1XPEHU$670673:HVW &KDNHU9 (G &RUURVLRQ)RUPVDQG&RQWUROIRU,QIUDVWUXFWXUH1XPEHU$670673:HVW
&RQVKRKRFNHQ3$86$$670,QWHUQDWLRQDO &RQVKRKRFNHQ3$86$$670,QWHUQDWLRQDO
>%HUWROLQLHWDO@%HUWROLQL/(OVHQHU%3HGHIHUUL3 3ROGHU5%  &RUURVLRQRI >%HUWROLQLHWDO@%HUWROLQL/(OVHQHU%3HGHIHUUL3 3ROGHU5%  &RUURVLRQRI
6WHHOLQ&RQFUHWH3UHYHQWLRQ'LDJQRVLV5HSDLU:HLQKHLP*HUPDQ\:LOH\9&+VWHGLWLRQ 6WHHOLQ&RQFUHWH3UHYHQWLRQ'LDJQRVLV5HSDLU:HLQKHLP*HUPDQ\:LOH\9&+VWHGLWLRQ
SS SS
>%KDGHVKLD +RQH\FRPEH@%KDGHVKLD+ +RQH\FRPEH5  6WHHOV0LFURVWUXFWXUH >%KDGHVKLD +RQH\FRPEH@%KDGHVKLD+ +RQH\FRPEH5  6WHHOV0LFURVWUXFWXUH
DQG3URSHUWLHV/RQGRQ8.%XWWHUZRUWK+HLQHPDQQ (OVHYLHU UGHGLWLRQSS DQG3URSHUWLHV/RQGRQ8.%XWWHUZRUWK+HLQHPDQQ (OVHYLHU UGHGLWLRQSS
>%|KQLHWDO@%|KQL++XQNHOHU)6FKLHJJ<*XOLNHUV-6FKLH‰O31UQEHUJHU8 >%|KQLHWDO@%|KQL++XQNHOHU)6FKLHJJ<*XOLNHUV-6FKLH‰O31UQEHUJHU8
5DXSDFK05|‰OHU*%FKOHU0 3ROGHU5%  &RUURVLRQLQ5HLQIRUFHG&RQFUHWH 5DXSDFK05|‰OHU*%FKOHU0 3ROGHU5%  &RUURVLRQLQ5HLQIRUFHG&RQFUHWH
6WUXFWXUHV&DPEULGJH(QJODQG:RRGKHDGVWHGLWLRQSS 6WUXFWXUHV&DPEULGJH(QJODQG:RRGKHDGVWHGLWLRQSS
>%MHUUHJDDUGHWDO@%MHUUHJDDUG/*HHOV.2WWHVHQ% 5FNHUW0  0HWDORJ >%MHUUHJDDUGHWDO@%MHUUHJDDUG/*HHOV.2WWHVHQ% 5FNHUW0  0HWDORJ
*XLGH%DOOHUXS'HQPDUN6WUXHUV$6UGHGLWLRQSS *XLGH%DOOHUXS'HQPDUN6WUXHUV$6UGHGLWLRQSS
>%RUJDUGHWDO@%RUJDUG%:DUUHQ&6RPD\DML5 +HLGHUVEDFK5   >%RUJDUGHWDO@%RUJDUG%:DUUHQ&6RPD\DML5 +HLGHUVEDFK5  
µ0HFKDQLVPVRIFRUURVLRQRIVWHHOLQFRQFUHWH¶SS±,Q%HUNH16&KDNHU9 :KLWLQJ µ0HFKDQLVPVRIFRUURVLRQRIVWHHOLQFRQFUHWH¶SS±,Q%HUNH16&KDNHU9 :KLWLQJ
' (GV &RUURVLRQUDWHVRIVWHHOLQFRQFUHWH1XPEHU$670673LQ$670673:HVW ' (GV &RUURVLRQUDWHVRIVWHHOLQFRQFUHWH1XPEHU$670673LQ$670673:HVW
&RQVKRKRFNHQ3$86$$670,QWHUQDWLRQDO &RQVKRKRFNHQ3$86$$670,QWHUQDWLRQDO
>%RXOIL]DHWDO@%RXOIL]D06DNDL.%DQWKLD1 <RVKLGD+  µ3UHGLFWLRQRI >%RXOIL]DHWDO@%RXOIL]D06DNDL.%DQWKLD1 <RVKLGD+  µ3UHGLFWLRQRI
&KORULGH,RQV,QJUHVVLQ8QFUDFNHGDQG&UDFNHG&RQFUHWH¶$&,0DWHULDOV-RXUQDO  SS± &KORULGH,RQV,QJUHVVLQ8QFUDFNHGDQG&UDFNHG&RQFUHWH¶$&,0DWHULDOV-RXUQDO  SS±

,9 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ,9 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 /LVWRI5HIHUHQFHV  /LVWRI5HIHUHQFHV

>%UDQGHQEXUJ@%UDQGHQEXUJ  5HF\OLQJRI5HLQIRUFHG&RQFUHWH%UDQGHQEXUJ,QGXVWULDO >%UDQGHQEXUJ@%UDQGHQEXUJ  5HF\OLQJRI5HLQIRUFHG&RQFUHWH%UDQGHQEXUJ,QGXVWULDO


6HUYLFH&KLFDJR,O86$:HEVLWHKWWSZZZEUDQGHQEXUJFRPDFFHVVHG1RY 6HUYLFH&KLFDJR,O86$:HEVLWHKWWSZZZEUDQGHQEXUJFRPDFFHVVHG1RY
>%URRPILHOG@%URRPILHOG-3  &RUURVLRQRI6WHHOLQ&RQFUHWH8QGHUVWDQGLQJ >%URRPILHOG@%URRPILHOG-3  &RUURVLRQRI6WHHOLQ&RQFUHWH8QGHUVWDQGLQJ
,QYHVWLJDWLRQDQG5HSDLU/RQGRQ8.( )16SRQ &KDSPDQ +DOO VWHGLWLRQSS ,QYHVWLJDWLRQDQG5HSDLU/RQGRQ8.( )16SRQ &KDSPDQ +DOO VWHGLWLRQSS
>%XHQIHOGHWDO@%XHQIHOG1*ODVV*5HGG\% 9LOHV)  3URFHVVIRUWKH >%XHQIHOGHWDO@%XHQIHOG1*ODVV*5HGG\% 9LOHV)  3URFHVVIRUWKH
3URWHFWLRQRI5HLQIRUFHPHQWLQ5HLQIRUFHG&RQFUHWH8QLWHG6WDWHV3DWHQW86372 3URWHFWLRQRI5HLQIRUFHPHQWLQ5HLQIRUFHG&RQFUHWH8QLWHG6WDWHV3DWHQW86372
$OH[DQGULD9$86$SS $OH[DQGULD9$86$SS
>&DOOLVWHU &DOOLVWHU@&DOOLVWHU:' &DOOLVWHU:'-  )XQGDPHQWDOVRI0DWHULDOV >&DOOLVWHU &DOOLVWHU@&DOOLVWHU:' &DOOLVWHU:'-  )XQGDPHQWDOVRI0DWHULDOV
6FLHQFHDQG(QJLQHHULQJ1HZ<RUN1<86$:LOH\WKHGLWLRQSS 6FLHQFHDQG(QJLQHHULQJ1HZ<RUN1<86$:LOH\WKHGLWLRQSS
>&DPSEHOOHWDO@&DPSEHOO'+6WXUP5' .RVPDWND6+  µ'HWHFWLQJ >&DPSEHOOHWDO@&DPSEHOO'+6WXUP5' .RVPDWND6+  µ'HWHFWLQJ
&DUERQDWLRQ¶&RQFUHWH7HFKQRORJ\7RGD\  SS± &DUERQDWLRQ¶&RQFUHWH7HFKQRORJ\7RGD\  SS±
>&DVWURHWDO@&DVWUR33D]LQL($QGUDGH& $ORQVR&  µ0DFURFHOODFWLYLW\LQ >&DVWURHWDO@&DVWUR33D]LQL($QGUDGH& $ORQVR&  µ0DFURFHOODFWLYLW\LQ
VOLJKWO\FKORULGHFRQWDPLQDWHGFRQFUHWHLQGXFHGE\UHLQIRUFHPHQWSULPHUV¶&RUURVLRQ  SS± VOLJKWO\FKORULGHFRQWDPLQDWHGFRQFUHWHLQGXFHGE\UHLQIRUFHPHQWSULPHUV¶&RUURVLRQ  SS±
 
>&DVWURHWDO@&DVWUR36DJpV$0RUHQR(0DOGRQDGR/ *HQHVFi-   >&DVWURHWDO@&DVWUR36DJpV$0RUHQR(0DOGRQDGR/ *HQHVFi-  
µ&KDUDFWHUL]DWLRQRI$FWLYDWHG7LWDQLXP6ROLG5HIHUHQFH(OHFWURGHVIRU&RUURVLRQ7HVWLQJRI6WHHOLQ µ&KDUDFWHUL]DWLRQRI$FWLYDWHG7LWDQLXP6ROLG5HIHUHQFH(OHFWURGHVIRU&RUURVLRQ7HVWLQJRI6WHHOLQ
&RQFUHWH¶&RUURVLRQ  SS± &RQFUHWH¶&RUURVLRQ  SS±
>&H)U&R@&H)U&R  &RQFUHWH&RUURVLRQ&HQWUH)UDQoDLVGHO¶DQWLFRUURVLRQ >&H)U&R@&H)U&R  &RQFUHWH&RUURVLRQ&HQWUH)UDQoDLVGHO¶DQWLFRUURVLRQ
&()5$&253DULV)UDQFH:HEVLWHKWWSZZZFRQFUHWHFRUURVLRQQHWDFFHVVHG0D\ &()5$&253DULV)UDQFH:HEVLWHKWWSZZZFRQFUHWHFRUURVLRQQHWDFFHVVHG0D\
>&HP1HW@&HP1HW  *OREDO&HPHQW5HSRUW&HP1HW'RUNLQJ8.:HEVLWH >&HP1HW@&HP1HW  *OREDO&HPHQW5HSRUW&HP1HW'RUNLQJ8.:HEVLWH
KWWSFHPQHWFRXNDFFHVVHG0D\ KWWSFHPQHWFRXNDFFHVVHG0D\
>&KHVQH\@&KHVQH\3  µ$QHZVSUD\FRDWLQJSURFHVVIRUPDQXIDFWXUHRIVWDLQOHVVVWHHO >&KHVQH\@&KHVQH\3  µ$QHZVSUD\FRDWLQJSURFHVVIRUPDQXIDFWXUHRIVWDLQOHVVVWHHO
FODGFRQVWUXFWLRQVWHHOZLWKUHVLVWDQFHWRFRUURVLRQE\GHLFLQJVDOWV VHDZDWHU¶SS±,Q FODGFRQVWUXFWLRQVWHHOZLWKUHVLVWDQFHWRFRUURVLRQE\GHLFLQJVDOWV VHDZDWHU¶SS±,Q
%DXFNKDJH.8KOHQZLQNHO9=LHVHQLV- /HDWKDP$ (GV 3URFHHGLQJVRIWKHWK %DXFNKDJH.8KOHQZLQNHO9=LHVHQLV- /HDWKDP$ (GV 3URFHHGLQJVRIWKHWK
,QWHUQDWLRQDO&RQIHUHQFHRQ6SUD\)RUPLQJ ,&6)9 %UHPHQ*HUPDQ\ ,QWHUQDWLRQDO&RQIHUHQFHRQ6SUD\)RUPLQJ ,&6)9 %UHPHQ*HUPDQ\
>&KHVV@&KHVV30  &DWKRGLF3URWHFWLRQRI6WHHOLQ&RQFUHWH/RQGRQ8.7D\ORU  >&KHVV@&KHVV30  &DWKRGLF3URWHFWLRQRI6WHHOLQ&RQFUHWH/RQGRQ8.7D\ORU 
)UDQFLVQGHGLWLRQSS )UDQFLVQGHGLWLRQSS
>&KRZGKXU\@&KRZGKXU\3&  µ6WUDWHJLHVIRUUHVLVWLQJFRUURVLRQRIUHLQIRUFHPHQWLQ >&KRZGKXU\@&KRZGKXU\3&  µ6WUDWHJLHVIRUUHVLVWLQJFRUURVLRQRIUHLQIRUFHPHQWLQ
FRQFUHWH¶7KH,QGLDQ&RQFUHWH-RXUQDOSS± FRQFUHWH¶7KH,QGLDQ&RQFUHWH-RXUQDOSS±
>&,(*@&,(*  (XURFRGHDQG5HLQIRUFHPHQW&RQFUHWH,QGXVWU\(XURFRGH*URXS >&,(*@&,(*  (XURFRGHDQG5HLQIRUFHPHQW&RQFUHWH,QGXVWU\(XURFRGH*URXS
&RRUGLQDWRU7KH&RQFUHWH&HQWUH%ODFNZDWHU8.:HEVLWHKWWSZZZHXURFRGHLQIRDFFHVVHG &RRUGLQDWRU7KH&RQFUHWH&HQWUH%ODFNZDWHU8.:HEVLWHKWWSZZZHXURFRGHLQIRDFFHVVHG
6HS 6HS
>&LJQDHWDO@&LJQD5$QGUDGH&1QEHUJHU83ROGHU5:H\GHUW5 6HLW] >&LJQDHWDO@&LJQD5$QGUDGH&1QEHUJHU83ROGHU5:H\GHUW5 6HLW]
( (GV   (85&RVW$FWLRQ&RUURVLRQRIVWHHOLQUHLQIRUFHGFRQFUHWHVWUXFWXUHV ( (GV   (85&RVW$FWLRQ&RUURVLRQRIVWHHOLQUHLQIRUFHGFRQFUHWHVWUXFWXUHV
)LQDO5HSRUW/X[HPERXUJ/X[HPERXUJ2IILFHIRU2IILFLDO3XEOLFDWLRQVRIWKH(XURSHDQ )LQDO5HSRUW/X[HPERXUJ/X[HPERXUJ2IILFHIRU2IILFLDO3XEOLFDWLRQVRIWKH(XURSHDQ
&RPPXQLWLHVVWHGLWLRQSS &RPPXQLWLHVVWHGLWLRQSS
>&OHPHxD 9LUPDQL@&OHPHxD** 9LUPDQL<3  µ&RPSDULQJWKH&KORULGH >&OHPHxD 9LUPDQL@&OHPHxD** 9LUPDQL<3  µ&RPSDULQJWKH&KORULGH
5HVLVWDQFHRI5HLQIRUFLQJ%DUV¶&RQFUHWH,QWHUQDWLRQDO  SS± 5HVLVWDQFHRI5HLQIRUFLQJ%DUV¶&RQFUHWH,QWHUQDWLRQDO  SS±
>&ROZHOO@&ROZHOO-$  2Q7KH0HFKDQLVPRI&RUURVLRQRI&RPSRVLWH7XEHVDW3RUWV >&ROZHOO@&ROZHOO-$  2Q7KH0HFKDQLVPRI&RUURVLRQRI&RPSRVLWH7XEHVDW3RUWV
LQ.UDIW5HFRYHU\%RLOHUV7HFKQLFDO3DSHU,QVWLWXWHRI3DSHU6FLHQFHDQG7HFKQRORJ\$WODQWD LQ.UDIW5HFRYHU\%RLOHUV7HFKQLFDO3DSHU,QVWLWXWHRI3DSHU6FLHQFHDQG7HFKQRORJ\$WODQWD
*$86$SS *$86$SS
>&RVWD $SSOHWRQ@&RVWD$ $SSOHWRQ-  µ&KORULGHSHQHWUDWLRQLQWRFRQFUHWHLQ >&RVWD $SSOHWRQ@&RVWD$ $SSOHWRQ-  µ&KORULGHSHQHWUDWLRQLQWRFRQFUHWHLQ
PDULQHHQYLURQPHQW±3DUW,,3UHGLFWLRQRIORQJWHUPFKORULGHSHQHWUDWLRQ¶0DWHULDOVDQG6WUXFWXUHV PDULQHHQYLURQPHQW±3DUW,,3UHGLFWLRQRIORQJWHUPFKORULGHSHQHWUDWLRQ¶0DWHULDOVDQG6WUXFWXUHV
  SS±   SS±
>&RWWLV 7XUJRRVH@&RWWLV5 7XUJRRVH6  (OHFWURFKHPLFDO,PSHGDQFHDQG1RLVH >&RWWLV 7XUJRRVH@&RWWLV5 7XUJRRVH6  (OHFWURFKHPLFDO,PSHGDQFHDQG1RLVH
&RUURVLRQ7HVWLQJ0DGH(DV\+RXVWRQ7;86$1$&(,QWHUQDWLRQDOVWHGLWLRQSS &RUURVLRQ7HVWLQJ0DGH(DV\+RXVWRQ7;86$1$&(,QWHUQDWLRQDOVWHGLWLRQSS
>&2:,D@&2:, D +HOJHODQG%ULGJH/HLUIMRUGHQ1RUZD\3HUVRQDOFRPPXQLFDWLRQ >&2:,D@&2:, D +HOJHODQG%ULGJH/HLUIMRUGHQ1RUZD\3HUVRQDOFRPPXQLFDWLRQ
.JV/\QJE\'HQPDUN/\QJE\'HQPDUN .JV/\QJE\'HQPDUN/\QJE\'HQPDUN
>&2:,E@&2:, E 1RWFKOLNHVKDSHFRUURVLRQDWWDFNRIUHLQIRUFLQJVWHHO3HUVRQDO >&2:,E@&2:, E 1RWFKOLNHVKDSHFRUURVLRQDWWDFNRIUHLQIRUFLQJVWHHO3HUVRQDO
FRPPXQLFDWLRQ&2:,$6.JV/\QJE\'HQPDUN FRPPXQLFDWLRQ&2:,$6.JV/\QJE\'HQPDUN

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 9 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 9
/LVWRI5HIHUHQFHV /LVWRI5HIHUHQFHV

>&2:,F@&2:, F 6SDOOLQJDWSLHURI)ORULGD.H\V%ULGJHV)/86$GXHWRFRUURVLRQ >&2:,F@&2:, F 6SDOOLQJDWSLHURI)ORULGD.H\V%ULGJHV)/86$GXHWRFRUURVLRQ


RIWKHHSR[\FRDWHGUHLQIRUFHPHQW3HUVRQDOFRPPXQLFDWLRQ.JV/\QJE\'HQPDUN/\QJE\ RIWKHHSR[\FRDWHGUHLQIRUFHPHQW3HUVRQDOFRPPXQLFDWLRQ.JV/\QJE\'HQPDUN/\QJE\
'HQPDUN 'HQPDUN
>&56,@&56,  6WHHO5HLQIRUFLQJ%DUV5HF\FOHG6SHFLDOUHSRUW&RQFUHWH5HLQIRUFLQJ >&56,@&56,  6WHHO5HLQIRUFLQJ%DUV5HF\FOHG6SHFLDOUHSRUW&RQFUHWH5HLQIRUFLQJ
6WHHO,QVWLWXWH6FKDXPEXUJ,/86$SS$YDLODEOHRQOLQH 6WHHO,QVWLWXWH6FKDXPEXUJ,/86$SS$YDLODEOHRQOLQH
KWWSZZZFUVLRUJSGIUHF\FOLQJBUHSRUWSGIDFFHVVHG0D\ KWWSZZZFUVLRUJSGIUHF\FOLQJBUHSRUWSGIDFFHVVHG0D\
>&6@&6  &DWKRGLF3URWHFWLRQRI5HLQIRUFHG&RQFUHWH5HSRUW75&RQFUHWH6RFLHW\ >&6@&6  &DWKRGLF3URWHFWLRQRI5HLQIRUFHG&RQFUHWH5HSRUW75&RQFUHWH6RFLHW\
%ODFNZDWHU8.SS %ODFNZDWHU8.SS
>&6@&6  3DWFK5HSDLURI5HLQIRUFHG&RQFUHWH6XEMHFWWR5HLQIRUFHPHQW&RUURVLRQ >&6@&6  3DWFK5HSDLURI5HLQIRUFHG&RQFUHWH6XEMHFWWR5HLQIRUFHPHQW&RUURVLRQ
5HSRUW75&RQFUHWH6RFLHW\%ODFNZDWHU8.SS 5HSRUW75&RQFUHWH6RFLHW\%ODFNZDWHU8.SS
>&6@&6  7KH5HOHYDQFHRI&UDFNLQJLQ&RQFUHWHWR&RUURVLRQRI5HLQIRUFHPHQW5HSRUW >&6@&6  7KH5HOHYDQFHRI&UDFNLQJLQ&RQFUHWHWR&RUURVLRQRI5HLQIRUFHPHQW5HSRUW
75&RQFUHWH6RFLHW\%ODFNZDWHU8.SS 75&RQFUHWH6RFLHW\%ODFNZDWHU8.SS
>&6@&6  *XLGHWR6XUIDFH7UHDWPHQWVIRU3URWHFWLRQDQG(QKDQFHPHQWRI&RQFUHWH >&6@&6  *XLGHWR6XUIDFH7UHDWPHQWVIRU3URWHFWLRQDQG(QKDQFHPHQWRI&RQFUHWH
5HSRUW75&RQFUHWH6RFLHW\%ODFNZDWHU8.SS 5HSRUW75&RQFUHWH6RFLHW\%ODFNZDWHU8.SS
>&6@&6  *XLGDQFHRQWKHXVHRI6WDLQOHVV6WHHO5HLQIRUFHPHQW5HSRUW75&RQFUHWH >&6@&6  *XLGDQFHRQWKHXVHRI6WDLQOHVV6WHHO5HLQIRUFHPHQW5HSRUW75&RQFUHWH
6RFLHW\%ODFNZDWHU8.SS 6RFLHW\%ODFNZDWHU8.SS
>&XVVRQ 0DLOYDJDQDP@&XVVRQ' 0DLOYDJDQDP1  µ'XUDELOLW\RIUHSDLU >&XVVRQ 0DLOYDJDQDP@&XVVRQ' 0DLOYDJDQDP1  µ'XUDELOLW\RIUHSDLU
PDWHULDOV¶&RQFUHWH,QWHUQDWLRQDO  SS± PDWHULDOV¶&RQFUHWH,QWHUQDWLRQDO  SS±
>&XWOHUHWDO@&XWOHU&6PLWK) &RFKUDQH'  µ6WDLQOHVV6WHHO5HLQIRUFLQJ%DUV¶ >&XWOHUHWDO@&XWOHU&6PLWK) &RFKUDQH'  µ6WDLQOHVV6WHHO5HLQIRUFLQJ%DUV¶
YROXPHSS±,Q3URFHHGLQJVRIWKHWK,QWHUQDWLRQDO&RQIHUHQFHRQ'HWHULRUDWLRQDQG YROXPHSS±,Q3URFHHGLQJVRIWKHWK,QWHUQDWLRQDO&RQIHUHQFHRQ'HWHULRUDWLRQDQG
5HSDLURI5HLQIRUFHG&RQFUHWHLQWKH$UDELDQ*XOI0DQDPD%DKUDLQ 5HSDLURI5HLQIRUFHG&RQFUHWHLQWKH$UDELDQ*XOI0DQDPD%DKUDLQ
>'DYLV@'DYLV-5  0HWDOV+DQGERRN'HVN(GLWLRQ/RQGRQ8.&5& 7D\ORU  >'DYLV@'DYLV-5  0HWDOV+DQGERRN'HVN(GLWLRQ/RQGRQ8.&5& 7D\ORU 
)UDQFLV QGHGLWLRQSS )UDQFLV QGHGLWLRQSS
>'%5@'%5  'XUDELOLW\DQG5HSDLURI5HLQIRUFHG&RQFUHWH3HUVRQDOFRPPXQLFDWLRQ >'%5@'%5  'XUDELOLW\DQG5HSDLURI5HLQIRUFHG&RQFUHWH3HUVRQDOFRPPXQLFDWLRQ
'DQVN%HWRQUnG7DDVWUXS'HQPDUN 'DQVN%HWRQUnG7DDVWUXS'HQPDUN
>'LFNVRQHWDO@'LFNVRQ'3(%HUU\)-%DXPLQJHU(5'DWWDJXSWD6-RKQVRQ >'LFNVRQHWDO@'LFNVRQ'3(%HUU\)-%DXPLQJHU(5'DWWDJXSWD6-RKQVRQ
&(/RQJ*-1RZLN,3DULVK59 7KRPDV0)  0|VVEDXHU6SHFWURVFRS\ &(/RQJ*-1RZLN,3DULVK59 7KRPDV0)  0|VVEDXHU6SHFWURVFRS\
&DPEULGJH8.&DPEULGJH8QLYHUVLW\3UHVVVWHGLWLRQSS &DPEULGJH8.&DPEULGJH8QLYHUVLW\3UHVVVWHGLWLRQSS
>'ULVVLHWDO@'ULVVL65HIDLW3$EGHOPRXOD0 *pQLQ-  µ7KHSUHSDUDWLRQDQG >'ULVVLHWDO@'ULVVL65HIDLW3$EGHOPRXOD0 *pQLQ-  µ7KHSUHSDUDWLRQDQG
WKHUPRG\QDPLFSURSHUWLHVRI)H ,, )H ,,, K\GUR[LGHFDUERQDWH JUHHQUXVW 3RXUEDL[GLDJUDPRI WKHUPRG\QDPLFSURSHUWLHVRI)H ,, )H ,,, K\GUR[LGHFDUERQDWH JUHHQUXVW 3RXUEDL[GLDJUDPRI
LURQLQFDUERQDWHFRQWDLQLQJDTXHRXVPHGLD¶&RUURVLRQ6FLHQFH  SS± LURQLQFDUERQDWHFRQWDLQLQJDTXHRXVPHGLD¶&RUURVLRQ6FLHQFH  SS±
>'6@'6  $UPHULQJVVWnO$UPHULQJVVWnOLUHWWHVW QJHUDQYHQGWVRPLNNH >'6@'6  $UPHULQJVVWnO$UPHULQJVVWnOLUHWWHVW QJHUDQYHQGWVRPLNNH
IRUVS QGWDUPHULQJLEHWRQNRQVWUXNWLRQHU6WDQGDUG'6'DQVN6WDQGDUG&KDUORWWHQOXQG IRUVS QGWDUPHULQJLEHWRQNRQVWUXNWLRQHU6WDQGDUG'6'DQVN6WDQGDUG&KDUORWWHQOXQG
'HQPDUNSS'DQLVKODQJXDJH 'HQPDUNSS'DQLVKODQJXDJH
>'6@'6  &RQFUHWH3DUW3URGXFWVDQGV\VWHPVIRUWKHSURWHFWLRQ >'6@'6  &RQFUHWH3DUW3URGXFWVDQGV\VWHPVIRUWKHSURWHFWLRQ
DQGUHSDLURIFRQFUHWHVWUXFWXUHV3ULQFLSOHV'6KnQGERJ'DQVN6WDQGDUG '6  DQGUHSDLURIFRQFUHWHVWUXFWXUHV3ULQFLSOHV'6KnQGERJ'DQVN6WDQGDUG '6 
&KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS3DUWO\'DQLVKODQJXDJH &KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS3DUWO\'DQLVKODQJXDJH
>'6@'6  &RQFUHWH0DWHULDOV5XOHVIRUDSSOLFDWLRQRI(1LQ >'6@'6  &RQFUHWH0DWHULDOV5XOHVIRUDSSOLFDWLRQRI(1LQ
'HQPDUN$SSOLFDWLRQUXOHV'6'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNVW 'HQPDUN$SSOLFDWLRQUXOHV'6'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNVW
HGLWLRQSS'DQLVKODQJXDJH HGLWLRQSS'DQLVKODQJXDJH
>'6&(176@'6&(176  (OHFWURFKHPLFDOUHDONDOL]DWLRQDQG >'6&(176@'6&(176  (OHFWURFKHPLFDOUHDONDOL]DWLRQDQG
FKORULGHH[WUDFWLRQWUHDWPHQWVIRUUHLQIRUFHGFRQFUHWH3DUW5HDONDOL]DWLRQ6WDQGDUG'6&(176 FKORULGHH[WUDFWLRQWUHDWPHQWVIRUUHLQIRUFHGFRQFUHWH3DUW5HDONDOL]DWLRQ6WDQGDUG'6&(176
'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS 'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS
>'6(1@'6(1  +RWUROOHGSURGXFWVRIVWUXFWXUDOVWHHOV3DUW >'6(1@'6(1  +RWUROOHGSURGXFWVRIVWUXFWXUDOVWHHOV3DUW
*HQHUDOWHFKQLFDOGHOLYHU\FRQGLWLRQV6WDQGDUG'6(1'DQVN6WDQGDUG '6  *HQHUDOWHFKQLFDOGHOLYHU\FRQGLWLRQV6WDQGDUG'6(1'DQVN6WDQGDUG '6 
&KDUORWWHQOXQG'HQPDUNQGHGLWLRQSS &KDUORWWHQOXQG'HQPDUNQGHGLWLRQSS
>'6(1@'6(1  +RWUROOHGSURGXFWVRIVWUXFWXUDOVWHHOV3DUW >'6(1@'6(1  +RWUROOHGSURGXFWVRIVWUXFWXUDOVWHHOV3DUW
7HFKQLFDOGHOLYHU\FRQGLWLRQVIRUQRQDOOR\VWUXFWXUDOVWHHOV6WDQGDUG'6(1'DQVN 7HFKQLFDOGHOLYHU\FRQGLWLRQVIRUQRQDOOR\VWUXFWXUDOVWHHOV6WDQGDUG'6(1'DQVN
6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS 6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS

9, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 9, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 /LVWRI5HIHUHQFHV  /LVWRI5HIHUHQFHV

>'6(1@'6(1  0L[LQJZDWHUIRUFRQFUHWH6SHFLILFDWLRQIRUVDPSOLQJ >'6(1@'6(1  0L[LQJZDWHUIRUFRQFUHWH6SHFLILFDWLRQIRUVDPSOLQJ


WHVWLQJDQGDVVHVVLQJWKHVXLWDELOLW\RIZDWHULQFOXGLQJZDWHUUHFRYHUHGIURPSURFHVVHVLQFRQFUHWH WHVWLQJDQGDVVHVVLQJWKHVXLWDELOLW\RIZDWHULQFOXGLQJZDWHUUHFRYHUHGIURPSURFHVVHVLQFRQFUHWH
LQGXVWU\DVPL[LQJZDWHUIRUFRQFUHWH6WDQGDUG'6(1'DQVN6WDQGDUG '6  LQGXVWU\DVPL[LQJZDWHUIRUFRQFUHWH6WDQGDUG'6(1'DQVN6WDQGDUG '6 
&KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS &KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS
>'6(1@'6(1  6WHHOIRUWKHUHLQIRUFHPHQWRIFRQFUHWH:HOGDEOH >'6(1@'6(1  6WHHOIRUWKHUHLQIRUFHPHQWRIFRQFUHWH:HOGDEOH
UHLQIRUFLQJVWHHO*HQHUDO6WDQGDUG'6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG UHLQIRUFLQJVWHHO*HQHUDO6WDQGDUG'6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG
'HQPDUNQGHGLWLRQSS 'HQPDUNQGHGLWLRQSS
>'6(1@'6(1  6WDLQOHVV6WHHOV3DUW/LVWRI6WDLQOHVV6WHHOV >'6(1@'6(1  6WDLQOHVV6WHHOV3DUW/LVWRI6WDLQOHVV6WHHOV
6WDQGDUG'6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNQGHGLWLRQSS 6WDQGDUG'6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNQGHGLWLRQSS
>'6(1@'6(1  $JJUHJDWHVIRUFRQFUHWH6WDQGDUG'6(1 >'6(1@'6(1  $JJUHJDWHVIRUFRQFUHWH6WDQGDUG'6(1
'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNQGHGLWLRQSS 'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNQGHGLWLRQSS
>'6(1@'6(1  &DWKRGLF3URWHFWLRQRI6WHHOLQ&RQFUHWH6WDQGDUG >'6(1@'6(1  &DWKRGLF3URWHFWLRQRI6WHHOLQ&RQFUHWH6WDQGDUG
'6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS '6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS
>'6(1@'6(1  6LOLFDIXPHIRUFRQFUHWH3DUW'HILQLWLRQV >'6(1@'6(1  6LOLFDIXPHIRUFRQFUHWH3DUW'HILQLWLRQV
UHTXLUHPHQWVDQGFRQIRUPLW\FULWHULD6WDQGDUG'6(1'DQVN6WDQGDUG '6  UHTXLUHPHQWVDQGFRQIRUPLW\FULWHULD6WDQGDUG'6(1'DQVN6WDQGDUG '6 
&KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS &KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS
>'6(1@'6(1  3URGXFWVDQGV\VWHPVIRUWKHSURWHFWLRQDQGUHSDLURI >'6(1@'6(1  3URGXFWVDQGV\VWHPVIRUWKHSURWHFWLRQDQGUHSDLURI
FRQFUHWHVWUXFWXUHV7HVWPHWKRGV'HWHUPLQDWLRQRIFKORULGHFRQWHQWLQKDUGHQHGFRQFUHWH6WDQGDUG FRQFUHWHVWUXFWXUHV7HVWPHWKRGV'HWHUPLQDWLRQRIFKORULGHFRQWHQWLQKDUGHQHGFRQFUHWH6WDQGDUG
'6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS '6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS
>'6(1@'6(1  3URGXFWVDQGV\VWHPVIRUWKHSURWHFWLRQDQGUHSDLURI >'6(1@'6(1  3URGXFWVDQGV\VWHPVIRUWKHSURWHFWLRQDQGUHSDLURI
FRQFUHWHVWUXFWXUHV'HILQLWLRQVUHTXLUHPHQWVTXDOLW\FRQWURODQGHYDOXDWLRQRIFRQIRUPLW\3DUW FRQFUHWHVWUXFWXUHV'HILQLWLRQVUHTXLUHPHQWVTXDOLW\FRQWURODQGHYDOXDWLRQRIFRQIRUPLW\3DUW
'HILQLWLRQV6WDQGDUG'6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNQG 'HILQLWLRQV6WDQGDUG'6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNQG
HGLWLRQSS HGLWLRQSS
>'6(1@'6(1  3URGXFWVDQGV\VWHPVIRUWKHSURWHFWLRQDQGUHSDLURI >'6(1@'6(1  3URGXFWVDQGV\VWHPVIRUWKHSURWHFWLRQDQGUHSDLURI
FRQFUHWHVWUXFWXUHV'HILQLWLRQVUHTXLUHPHQWVTXDOLW\FRQWURODQGHYDOXDWLRQRIFRQIRUPLW\3DUW FRQFUHWHVWUXFWXUHV'HILQLWLRQVUHTXLUHPHQWVTXDOLW\FRQWURODQGHYDOXDWLRQRIFRQIRUPLW\3DUW
6XUIDFHSURWHFWLRQV\VWHPVIRUFRQFUHWH6WDQGDUG'6(1'DQVN6WDQGDUG '6  6XUIDFHSURWHFWLRQV\VWHPVIRUFRQFUHWH6WDQGDUG'6(1'DQVN6WDQGDUG '6 
&KDUORWWHQOXQG'HQPDUNQGHGLWLRQSS &KDUORWWHQOXQG'HQPDUNQGHGLWLRQSS
>'6(1@'6(1  3URGXFWVDQGV\VWHPVIRUWKHSURWHFWLRQDQGUHSDLURI >'6(1@'6(1  3URGXFWVDQGV\VWHPVIRUWKHSURWHFWLRQDQGUHSDLURI
FRQFUHWHVWUXFWXUHV'HILQLWLRQVUHTXLUHPHQWVTXDOLW\FRQWURODQGHYDOXDWLRQRIFRQIRUPLW\3DUW FRQFUHWHVWUXFWXUHV'HILQLWLRQVUHTXLUHPHQWVTXDOLW\FRQWURODQGHYDOXDWLRQRIFRQIRUPLW\3DUW
6WUXFWXUDODQGQRQVWUXFWXUDOUHSDLU6WDQGDUG'6(1'DQVN6WDQGDUG '6  6WUXFWXUDODQGQRQVWUXFWXUDOUHSDLU6WDQGDUG'6(1'DQVN6WDQGDUG '6 
&KDUORWWHQOXQG'HQPDUNQGHGLWLRQSS &KDUORWWHQOXQG'HQPDUNQGHGLWLRQSS
>'6(1@'6(1  3URGXFWVDQGV\VWHPVIRUWKHSURWHFWLRQDQGUHSDLURI >'6(1@'6(1  3URGXFWVDQGV\VWHPVIRUWKHSURWHFWLRQDQGUHSDLURI
FRQFUHWHVWUXFWXUHV'HILQLWLRQVUHTXLUHPHQWVTXDOLW\FRQWURODQGHYDOXDWLRQRIFRQIRUPLW\3DUW FRQFUHWHVWUXFWXUHV'HILQLWLRQVUHTXLUHPHQWVTXDOLW\FRQWURODQGHYDOXDWLRQRIFRQIRUPLW\3DUW
6WUXFWXUDOERQGLQJ6WDQGDUG'6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNVW 6WUXFWXUDOERQGLQJ6WDQGDUG'6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNVW
HGLWLRQSS HGLWLRQSS
>'6(1@'6(1  3URGXFWVDQGV\VWHPVIRUWKHSURWHFWLRQDQGUHSDLURI >'6(1@'6(1  3URGXFWVDQGV\VWHPVIRUWKHSURWHFWLRQDQGUHSDLURI
FRQFUHWHVWUXFWXUHV'HILQLWLRQVUHTXLUHPHQWVTXDOLW\FRQWURODQGHYDOXDWLRQRIFRQIRUPLW\3DUW FRQFUHWHVWUXFWXUHV'HILQLWLRQVUHTXLUHPHQWVTXDOLW\FRQWURODQGHYDOXDWLRQRIFRQIRUPLW\3DUW
&RQFUHWHLQMHFWLRQ6WDQGDUG'6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNQG &RQFUHWHLQMHFWLRQ6WDQGDUG'6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNQG
HGLWLRQSS HGLWLRQSS
>'6(1@'6(1  *URXQGJUDQXODWHGEODVWIXUQDFHVODJIRUXVHLQ >'6(1@'6(1  *URXQGJUDQXODWHGEODVWIXUQDFHVODJIRUXVHLQ
FRQFUHWHPRUWDUDQGJURXW3DUW'HILQLWLRQVVSHFLILFDWLRQVDQGFRQIRUPLW\FULWHULD6WDQGDUG FRQFUHWHPRUWDUDQGJURXW3DUW'HILQLWLRQVVSHFLILFDWLRQVDQGFRQIRUPLW\FULWHULD6WDQGDUG
'6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS '6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS
>'6(1@'6(1  0HWKRGVRIWHVWLQJFHPHQW'HWHUPLQDWLRQRIVWUHQJWK >'6(1@'6(1  0HWKRGVRIWHVWLQJFHPHQW'HWHUPLQDWLRQRIVWUHQJWK
6WDQGDUG'6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS 6WDQGDUG'6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS
>'6(1@'6(1  &HPHQW3DUW&RPSRVLWLRQ6SHFLILFDWLRQVDQG >'6(1@'6(1  &HPHQW3DUW&RPSRVLWLRQ6SHFLILFDWLRQVDQG
&RQIRUPLW\&ULWHULDIRU&RPPRQ&HPHQWV6WDQGDUG'6(1'DQVN6WDQGDUG '6  &RQIRUPLW\&ULWHULDIRU&RPPRQ&HPHQWV6WDQGDUG'6(1'DQVN6WDQGDUG '6 
&KDUORWWHQOXQG'HQPDUNQGHGLWLRQSS &KDUORWWHQOXQG'HQPDUNQGHGLWLRQSS
>'6(1@'6(1  (XURFRGH'HVLJQRIFRQFUHWHVWUXFWXUHV3DUW >'6(1@'6(1  (XURFRGH'HVLJQRIFRQFUHWHVWUXFWXUHV3DUW
*HQHUDOUXOHVDQGUXOHVIRUEXLOGLQJV6WDQGDUG'6(1'DQVN6WDQGDUG '6  *HQHUDOUXOHVDQGUXOHVIRUEXLOGLQJV6WDQGDUG'6(1'DQVN6WDQGDUG '6 
&KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS &KDUORWWHQOXQG'HQPDUNVWHGLWLRQSS

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 9,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 9,,


/LVWRI5HIHUHQFHV /LVWRI5HIHUHQFHV

>'6(1@'6(1  &RQFUHWH3DUW6SHFLILFDWLRQ3HUIRUPDQFH >'6(1@'6(1  &RQFUHWH3DUW6SHFLILFDWLRQ3HUIRUPDQFH


3URGXFWLRQDQG&RQIRUPLW\6WDQGDUG(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG 3URGXFWLRQDQG&RQIRUPLW\6WDQGDUG(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG
'HQPDUNQGHGLWLRQSS 'HQPDUNQGHGLWLRQSS
>'6(1@'6(1  )O\DVKIRUFRQFUHWH3DUW'HILQLWLRQVSHFLILFDWLRQV >'6(1@'6(1  )O\DVKIRUFRQFUHWH3DUW'HILQLWLRQVSHFLILFDWLRQV
DQGFRQIRUPLW\FULWHULD6WDQGDUG'6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUN DQGFRQIRUPLW\FULWHULD6WDQGDUG'6(1'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUN
VWHGLWLRQSS VWHGLWLRQSS
>'6(1@'6(1  $GPL[WXUHVIRUFRQFUHWHPRUWDUDQGJURXW3DUW >'6(1@'6(1  $GPL[WXUHVIRUFRQFUHWHPRUWDUDQGJURXW3DUW
&RQFUHWHDGPL[WXUHV'HILQLWLRQVUHTXLUHPHQWVFRQIRUPLW\PDUNLQJDQGODEHOOLQJ6WDQGDUG'6(1 &RQFUHWHDGPL[WXUHV'HILQLWLRQVUHTXLUHPHQWVFRQIRUPLW\PDUNLQJDQGODEHOOLQJ6WDQGDUG'6(1
'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNUGHGLWLRQSS 'DQVN6WDQGDUG '6 &KDUORWWHQOXQG'HQPDUNUGHGLWLRQSS
>('$;@('$;  *HQHVLV6SHFWUXP9HUVLRQ(GVPDSSLQJVFUHHQGLSOD\VRIWZDUH >('$;@('$;  *HQHVLV6SHFWUXP9HUVLRQ(GVPDSSLQJVFUHHQGLSOD\VRIWZDUH
('$;,QF0DKZDK1-86$ ('$;,QF0DKZDK1-86$
>(GYDUGVHQ@(GYDUGVHQ&  µ:DWHUSHUPHDELOLW\DQGDXWRJHQRXVKHDOLQJRIFUDFNVLQ >(GYDUGVHQ@(GYDUGVHQ&  µ:DWHUSHUPHDELOLW\DQGDXWRJHQRXVKHDOLQJRIFUDFNVLQ
FRQFUHWH¶$&,0DWHULDOV-RXUQDO  SS± FRQFUHWH¶$&,0DWHULDOV-RXUQDO  SS±
>(OVHQHU@(OVHQHU%  &RUURVLRQ,QKLELWRUVIRU6WHHOLQ&RQFUHWH6WDWHRIWKH$UW >(OVHQHU@(OVHQHU%  &RUURVLRQ,QKLELWRUVIRU6WHHOLQ&RQFUHWH6WDWHRIWKH$UW
5HSRUW()&3XEOLFDWLRQ(XURSHDQ)HGHUDWLRQRI&RUURVLRQ ()& ,QVWLWXWHRI0DWHULDOV/RQGRQ 5HSRUW()&3XEOLFDWLRQ(XURSHDQ)HGHUDWLRQRI&RUURVLRQ ()& ,QVWLWXWHRI0DWHULDOV/RQGRQ
8.SS 8.SS
>(PPRQV 9D\VEXUG@(PPRQV3+ 9D\VEXUG$0  µ&RUURVLRQSURWHFWLRQLQ >(PPRQV 9D\VEXUG@(PPRQV3+ 9D\VEXUG$0  µ&RUURVLRQSURWHFWLRQLQ
FRQFUHWHUHSDLU0\WKDQGUHDOLW\¶&RQFUHWH,QWHUQDWLRQDO  SS± FRQFUHWHUHSDLU0\WKDQGUHDOLW\¶&RQFUHWH,QWHUQDWLRQDO  SS±
>(03$@(03$  &(0'$7$7KHUPRG\QDPLFGDWDIRUK\GUDWHGVROLGVLQ3RUWODQG >(03$@(03$  &(0'$7$7KHUPRG\QDPLFGDWDIRUK\GUDWHGVROLGVLQ3RUWODQG
FHPHQWV\VWHP(03$'EHQGRUI6ZLW]HUODQG:HEVLWHKWWSZZZHPSDFKDFFHVVHG6HS FHPHQWV\VWHP(03$'EHQGRUI6ZLW]HUODQG:HEVLWHKWWSZZZHPSDFKDFFHVVHG6HS
>(QJHOXQGHWDO@(QJHOXQG6(GYDUGVHQ& 0RKU/  *HQHUDO*XLGHOLQHVIRU >(QJHOXQGHWDO@(QJHOXQG6(GYDUGVHQ& 0RKU/  *HQHUDO*XLGHOLQHVIRU
'XUDELOLW\'HVLJQDQG5HGHVLJQ'RFXPHQW%(5(XURSHDQ8QLRQ/X[HPERXUJSS 'XUDELOLW\'HVLJQDQG5HGHVLJQ'RFXPHQW%(5(XURSHDQ8QLRQ/X[HPERXUJSS
3DUWRIWKH%ULWH(X5DP,,,3URMHFW%('XUD&UHWH3UREDELOLVWLF3HUIRUPDQFHEDVHG'XUDELOLW\ 3DUWRIWKH%ULWH(X5DP,,,3URMHFW%('XUD&UHWH3UREDELOLVWLF3HUIRUPDQFHEDVHG'XUDELOLW\
'HVLJQRI&RQFUHWH6WUXFWXUHV 'HVLJQRI&RQFUHWH6WUXFWXUHV
>(6'8@(6'8  (6'86SHFLILFKHDWFDSDFLW\DWFRQVWDQWSUHVVXUHRILFHZDWHU >(6'8@(6'8  (6'86SHFLILFKHDWFDSDFLW\DWFRQVWDQWSUHVVXUHRILFHZDWHU
DQGVWHDP,+6(6'8,QWHUQDWLRQDO/RQGRQ8.:HEVLWHKWWSZZZHVGXFRPDFFHVVHG6HS DQGVWHDP,+6(6'8,QWHUQDWLRQDO/RQGRQ8.:HEVLWHKWWSZZZHVGXFRPDFFHVVHG6HS
 
>(7@(7  6FKZHLVV]XVlW]H0DJQHVLXP'DWDVKHHW'UDKWZHUN(OLVHQWDO1HXHQUDGH >(7@(7  6FKZHLVV]XVlW]H0DJQHVLXP'DWDVKHHW'UDKWZHUN(OLVHQWDO1HXHQUDGH
*HUPDQ\SS*HUPDQODQJXDJH *HUPDQ\SS*HUPDQODQJXDJH
>(7@(7  :HUVWRIIGDWHQEODWW'UDKWDXV0DJQHVLXPOHJLHUXQJ$=;'DWDVKHHW >(7@(7  :HUVWRIIGDWHQEODWW'UDKWDXV0DJQHVLXPOHJLHUXQJ$=;'DWDVKHHW
'UDKWZHUN(OLVHQWDO1HXHQUDGH*HUPDQ\SS*HUPDQODQJXDJH 'UDKWZHUN(OLVHQWDO1HXHQUDGH*HUPDQ\SS*HUPDQODQJXDJH
>)DJHUOXQG@)DJHUOXQG*  µ6HUYLFH/LIHRI6WUXFWXUHV¶SS±,Q3URFHHGLQJRI >)DJHUOXQG@)DJHUOXQG*  µ6HUYLFH/LIHRI6WUXFWXUHV¶SS±,Q3URFHHGLQJRI
6\PSRVLXPRQ4XDOLW\&RQWURORI&RQFUHWH6WUXFWXUHV6WRFNKROP6ZHGHQ 6\PSRVLXPRQ4XDOLW\&RQWURORI&RQFUHWH6WUXFWXUHV6WRFNKROP6ZHGHQ
>)DXVW $O\@)DXVW6' $O\20  &KHPLVWU\RI:DWHU7UHDWPHQW%RFD5DWRQ >)DXVW $O\@)DXVW6' $O\20  &KHPLVWU\RI:DWHU7UHDWPHQW%RFD5DWRQ
)/86$&5&QGHGLWLRQSS )/86$&5&QGHGLWLRQSS
>)(,@)(,  7RROVIRU%DQRWHFK)(,&RPSDQ\+LOOVERUR2586$:HEVLWH >)(,@)(,  7RROVIRU%DQRWHFK)(,&RPSDQ\+LOOVERUR2586$:HEVLWH
KWWSZZZIHLFRPDFFHVVHG'HF KWWSZZZIHLFRPDFFHVVHG'HF
>ILE@ILE  ,QWHUQDWLRQDO6\VWHPRI8QLILHG6WDQGDUG&RGHVRI3UDFWLFHIRU6WUXFWXUHV >ILE@ILE  ,QWHUQDWLRQDO6\VWHPRI8QLILHG6WDQGDUG&RGHVRI3UDFWLFHIRU6WUXFWXUHV
9ROXPH&RPPRQXQLILHGUXOHVIRUGLIIHUHQWW\SHVRIFRQVWUXFWLRQDQGPDWHULDO9ROXPH&(%),3 9ROXPH&RPPRQXQLILHGUXOHVIRUGLIIHUHQWW\SHVRIFRQVWUXFWLRQDQGPDWHULDO9ROXPH&(%),3
0RGHO&RGHIRUFRQFUHWHVWUXFWXUHV&(%%XOOHWLQ,QWHUQDWLRQDO)HGHUDWLRQIRU6WUXFWXUDO 0RGHO&RGHIRUFRQFUHWHVWUXFWXUHV&(%%XOOHWLQ,QWHUQDWLRQDO)HGHUDWLRQIRU6WUXFWXUDO
&RQFUHWH ILE /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS &RQFUHWH ILE /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS
>ILE@ILE  'XUDEOH&RQFUHWH6WUXFWXUHV'HVLJQ*XLGH&(%%XOOHWLQ,QWHUQDWLRQDO >ILE@ILE  'XUDEOH&RQFUHWH6WUXFWXUHV'HVLJQ*XLGH&(%%XOOHWLQ,QWHUQDWLRQDO
)HGHUDWLRQIRU6WUXFWXUDO&RQFUHWH ILE /DXVDQQH6ZLW]HUODQGQGHGLWLRQSS )HGHUDWLRQIRU6WUXFWXUDO&RQFUHWH ILE /DXVDQQH6ZLW]HUODQGQGHGLWLRQSS
>ILE@ILE  &(%),30RGHO&RGH&(%%XOOHWLQ,QWHUQDWLRQDO)HGHUDWLRQIRU >ILE@ILE  &(%),30RGHO&RGH&(%%XOOHWLQ,QWHUQDWLRQDO)HGHUDWLRQIRU
6WUXFWXUDO&RQFUHWH ILE /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS 6WUXFWXUDO&RQFUHWH ILE /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS
>ILE@ILE  $SSOLFDWLRQRI+LJK3HUIRUPDQFH&RQFUHWH&(%%XOOHWLQ,QWHUQDWLRQDO >ILE@ILE  $SSOLFDWLRQRI+LJK3HUIRUPDQFH&RQFUHWH&(%%XOOHWLQ,QWHUQDWLRQDO
)HGHUDWLRQIRU6WUXFWXUDO&RQFUHWH ILE /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS )HGHUDWLRQIRU6WUXFWXUDO&RQFUHWH ILE /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS
>ILED@ILE D &RDWLQJ3URWHFWLRQIRU5HLQIRUFHPHQW6WDWHRIWKH$UW5HSRUW&(%%XOOHWLQ >ILED@ILE D &RDWLQJ3URWHFWLRQIRU5HLQIRUFHPHQW6WDWHRIWKH$UW5HSRUW&(%%XOOHWLQ
,QWHUQDWLRQDO)HGHUDWLRQIRU6WUXFWXUDO&RQFUHWH ILE /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS ,QWHUQDWLRQDO)HGHUDWLRQIRU6WUXFWXUDO&RQFUHWH ILE /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS

9,,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN 9,,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 /LVWRI5HIHUHQFHV  /LVWRI5HIHUHQFHV

>ILEE@ILE E +LJK3HUIRUPDQFH&RQFUHWH5HFRPPHQGHG([WHQVLRQVWRWKH0RGHO&RGH >ILEE@ILE E +LJK3HUIRUPDQFH&RQFUHWH5HFRPPHQGHG([WHQVLRQVWRWKH0RGHO&RGH


5HVHDUFK1HHGV&(%%XOOHWLQ,QWHUQDWLRQDO)HGHUDWLRQIRU6WUXFWXUDO&RQFUHWH ILE  5HVHDUFK1HHGV&(%%XOOHWLQ,QWHUQDWLRQDO)HGHUDWLRQIRU6WUXFWXUDO&RQFUHWH ILE 
/DXVDQQH6ZLW]HUODQGVWHGLWLRQSS /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS
>ILED@ILE D 6WUXFWXUDO&RQFUHWH7H[WERRNRQ%HKDYLRXU'HVLJQDQG3HUIRUPDQFH >ILED@ILE D 6WUXFWXUDO&RQFUHWH7H[WERRNRQ%HKDYLRXU'HVLJQDQG3HUIRUPDQFH
9ROXPH'XUDELOLW\'HVLJQIRU)LUH5HVLVWDQFH0HPEHU'HVLJQ0DLQWHQDQFH$VVHVVPHQWDQG 9ROXPH'XUDELOLW\'HVLJQIRU)LUH5HVLVWDQFH0HPEHU'HVLJQ0DLQWHQDQFH$VVHVVPHQWDQG
5HSDLU3UDFWLFDO$VSHFWVILE%XOOHWLQ,QWHUQDWLRQDO)HGHUDWLRQIRU6WUXFWXUDO&RQFUHWH ILE  5HSDLU3UDFWLFDO$VSHFWVILE%XOOHWLQ,QWHUQDWLRQDO)HGHUDWLRQIRU6WUXFWXUDO&RQFUHWH ILE 
/DXVDQQH6ZLW]HUODQGVWHGLWLRQSS /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS
>ILEE@ILE E 6WUXFWXUDO&RQFUHWH7H[WERRNRQ%HKDYLRXU'HVLJQDQG3HUIRUPDQFH >ILEE@ILE E 6WUXFWXUDO&RQFUHWH7H[WERRNRQ%HKDYLRXU'HVLJQDQG3HUIRUPDQFH
9ROXPH,QWURGXFWLRQ'HVLJQ3URFHVV0DWHULDOVILE%XOOHWLQ,QWHUQDWLRQDO)HGHUDWLRQIRU 9ROXPH,QWURGXFWLRQ'HVLJQ3URFHVV0DWHULDOVILE%XOOHWLQ,QWHUQDWLRQDO)HGHUDWLRQIRU
6WUXFWXUDO&RQFUHWH ILE /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS 6WUXFWXUDO&RQFUHWH ILE /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS
>ILEF@ILE F 6WUXFWXUDO&RQFUHWH7H[WERRNRQ%HKDYLRXU'HVLJQDQG3HUIRUPDQFH >ILEF@ILE F 6WUXFWXUDO&RQFUHWH7H[WERRNRQ%HKDYLRXU'HVLJQDQG3HUIRUPDQFH
9ROXPH%DVLVRI'HVLJQILE%XOOHWLQ,QWHUQDWLRQDO)HGHUDWLRQIRU6WUXFWXUDO&RQFUHWH ILE  9ROXPH%DVLVRI'HVLJQILE%XOOHWLQ,QWHUQDWLRQDO)HGHUDWLRQIRU6WUXFWXUDO&RQFUHWH ILE 
/DXVDQQH6ZLW]HUODQGVWHGLWLRQSS /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS
>ILE@ILE  (QYLURQPHQWDOGHVLJQILE%XOOHWLQ,QWHUQDWLRQDO)HGHUDWLRQIRU6WUXFWXUDO >ILE@ILE  (QYLURQPHQWDOGHVLJQILE%XOOHWLQ,QWHUQDWLRQDO)HGHUDWLRQIRU6WUXFWXUDO
&RQFUHWH ILE /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS &RQFUHWH ILE /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS
>ILE@ILE  0RGHO&RGHIRU6HUYLFH/LIH'HVLJQILE%XOOHWLQ,QWHUQDWLRQDO)HGHUDWLRQ >ILE@ILE  0RGHO&RGHIRU6HUYLFH/LIH'HVLJQILE%XOOHWLQ,QWHUQDWLRQDO)HGHUDWLRQ
IRU6WUXFWXUDO&RQFUHWH ILE /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS IRU6WUXFWXUDO&RQFUHWH ILE /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS
>ILE@ILE  )53UHLQIRUFHPHQWLQ5&VWUXFWXUHVILE%XOOHWLQ,QWHUQDWLRQDO)HGHUDWLRQ >ILE@ILE  )53UHLQIRUFHPHQWLQ5&VWUXFWXUHVILE%XOOHWLQ,QWHUQDWLRQDO)HGHUDWLRQ
IRU6WUXFWXUDO&RQFUHWH ILE /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS IRU6WUXFWXUDO&RQFUHWH ILE /DXVDQQH6ZLW]HUODQGVWHGLWLRQSS
>)ROH\@)ROH\57  µ5ROHRIWKH&KORULGH,RQLQ,URQ&RUURVLRQ¶&RUURVLRQ1$&( >)ROH\@)ROH\57  µ5ROHRIWKH&KORULGH,RQLQ,URQ&RUURVLRQ¶&RUURVLRQ1$&(
  SS±   SS±
>)RVURF@)RVURF  *DOYDVKLHOG;37LHGRQ6DFULILFLDO$QRGH8QLWVIRU&RUURVLRQ >)RVURF@)RVURF  *DOYDVKLHOG;37LHGRQ6DFULILFLDO$QRGH8QLWVIRU&RUURVLRQ
3UHYHQWLRQ'DWDVKHHW&O6I%;K)RVURF/LPLWHG7DPZRUWK8.SS 3UHYHQWLRQ'DWDVKHHW&O6I%;K)RVURF/LPLWHG7DPZRUWK8.SS
>)UDQFRLV $UOLJXLH@)UDQFRLV5 $UOLJXLH*  µ,QIOXHQFHRIVHUYLFHFUDFNLQJRQ >)UDQFRLV $UOLJXLH@)UDQFRLV5 $UOLJXLH*  µ,QIOXHQFHRIVHUYLFHFUDFNLQJRQ
UHLQIRUFHPHQWVWHHOFRUURVLRQ¶-RXUQDORI0DWHULDOVLQ&LYLO(QJLQHHULQJ  SS± UHLQIRUFHPHQWVWHHOFRUURVLRQ¶-RXUQDORI0DWHULDOVLQ&LYLO(QJLQHHULQJ  SS±
>)UDWHVLD@)UDWHVL5 D µ*DOYDQL]HG5HLQIRUFLQJ6WHHO%DUVLQ&RQFUHWH¶SS±,Q >)UDWHVLD@)UDWHVL5 D µ*DOYDQL]HG5HLQIRUFLQJ6WHHO%DUVLQ&RQFUHWH¶SS±,Q
)LQDO5HSRUWRI&267:RUNVKRS/X[HPERXUJ/X[HPERXUJ )LQDO5HSRUWRI&267:RUNVKRS/X[HPERXUJ/X[HPERXUJ
>)UDWHVLE@)UDWHVL5 E *DOYDQL]HG6WHHO5HLQIRUFHPHQWFKDSWHUSS±,Q >)UDWHVLE@)UDWHVL5 E *DOYDQL]HG6WHHO5HLQIRUFHPHQWFKDSWHUSS±,Q
&LJQD5$QGUDGH&1QEHUJHU83ROGHU5:H\GHUW5 6HLW]( (GV (85&RVW &LJQD5$QGUDGH&1QEHUJHU83ROGHU5:H\GHUW5 6HLW]( (GV (85&RVW
$FWLRQ&RUURVLRQRIVWHHOLQUHLQIRUFHGFRQFUHWHVWUXFWXUHV)LQDO5HSRUW/X[HPERXUJ $FWLRQ&RUURVLRQRIVWHHOLQUHLQIRUFHGFRQFUHWHVWUXFWXUHV)LQDO5HSRUW/X[HPERXUJ
/X[HPERXUJ2IILFHIRU2IILFLDO3XEOLFDWLRQVRIWKH(XURSHDQ&RPPXQLWLHVVWHGLWLRQ /X[HPERXUJ2IILFHIRU2IILFLDO3XEOLFDWLRQVRIWKH(XURSHDQ&RPPXQLWLHVVWHGLWLRQ
>)UHGHULNVHQ@)UHGHULNVHQ-0  &KORULGH3HQHWUDWLRQLQWR&RQFUHWH5HOHYDQW7HVW >)UHGHULNVHQ@)UHGHULNVHQ-0  &KORULGH3HQHWUDWLRQLQWR&RQFUHWH5HOHYDQW7HVW
0HWKRGV+(7(.5HSRUW1R'DQLVK5RDG'LUHFWRUDWH&RSHQKDJHQ'HQPDUNSS3DUWO\ 0HWKRGV+(7(.5HSRUW1R'DQLVK5RDG'LUHFWRUDWH&RSHQKDJHQ'HQPDUNSS3DUWO\
'DQLVKODQJXDJH 'DQLVKODQJXDJH
>)UHGHULNVHQ 3RXOVHQ@)UHGHULNVHQ-0 3RXOVHQ(  &KORULGH3HQHWUDWLRQLQWR >)UHGHULNVHQ 3RXOVHQ@)UHGHULNVHQ-0 3RXOVHQ(  &KORULGH3HQHWUDWLRQLQWR
&RQFUHWH0DQXDO+(7(.5HSRUW1R'DQLVK5RDG'LUHFWRUDWH&RSHQKDJHQ'HQPDUNSS &RQFUHWH0DQXDO+(7(.5HSRUW1R'DQLVK5RDG'LUHFWRUDWH&RSHQKDJHQ'HQPDUNSS
>)UHLHVOHEHQ+DQVHQ@)UHLHVOHEHQ+DQVHQ3  0DWHULDOHI\VLNIRUE\JQLQJVLQJHQL¡UHU >)UHLHVOHEHQ+DQVHQ@)UHLHVOHEHQ+DQVHQ3  0DWHULDOHI\VLNIRUE\JQLQJVLQJHQL¡UHU
1XPEHULQ6%,DQYLVQLQJHU*ORVWUXS'HQPDUN6WDWHQV%\JJHIRUVNQLQJLQVWLWXWVWHGLWLRQ 1XPEHULQ6%,DQYLVQLQJHU*ORVWUXS'HQPDUN6WDWHQV%\JJHIRUVNQLQJLQVWLWXWVWHGLWLRQ
SS'DQLVKODQJXDJH SS'DQLVKODQJXDJH
>)ULHGPDQQ@)ULHGPDQQ'  6KULQNDJH&UDFNVLQ3RXUHG&RQFUHWH6ODE >)ULHGPDQQ@)ULHGPDQQ'  6KULQNDJH&UDFNVLQ3RXUHG&RQFUHWH6ODE
,QVSHFW$3HGLD&OHYHODQG2+:HEVLWHKWWSZZZLQVSHFWQ\FRPDFFHVVHG1RY ,QVSHFW$3HGLD&OHYHODQG2+:HEVLWHKWWSZZZLQVSHFWQ\FRPDFFHVVHG1RY
>*DEULHOOL@*DEULHOOL&  ,GHQWLILFDWLRQRI(OHFWURFKHPLFDO3URFHVVHVE\)UHTXHQF\ >*DEULHOOL@*DEULHOOL&  ,GHQWLILFDWLRQRI(OHFWURFKHPLFDO3URFHVVHVE\)UHTXHQF\
5HVSRQVH$QDO\VLV7HFKQLFDOUHSRUW8QLYHUVLWp3LHUUHHW0DULH&XULH 830& 3DULV)UDQFH 5HVSRQVH$QDO\VLV7HFKQLFDOUHSRUW8QLYHUVLWp3LHUUHHW0DULH&XULH 830& 3DULV)UDQFH
SS SS
>*DLGLV@*DLGLV-0  µ&KHPLVWU\RIFRUURVLRQLQKLELWRUV¶&HPHQWDQG&RQFUHWH >*DLGLV@*DLGLV-0  µ&KHPLVWU\RIFRUURVLRQLQKLELWRUV¶&HPHQWDQG&RQFUHWH
&RPSRVLWHV  SS± &RPSRVLWHV  SS±
>*DPU\@*DPU\  *DPU\)UDPHZRUN9HUVLRQ6RIWZDUH*DPU\,QVWUXPHQWV >*DPU\@*DPU\  *DPU\)UDPHZRUN9HUVLRQ6RIWZDUH*DPU\,QVWUXPHQWV
:DUPLQVWHU3$86$ :DUPLQVWHU3$86$
>*DPU\@*DPU\  %DVLFVRI(OHFWURFKHPLFDO,PSHGDQFH6SHFWURVFRS\$SSOLFDWLRQQRWH >*DPU\@*DPU\  %DVLFVRI(OHFWURFKHPLFDO,PSHGDQFH6SHFWURVFRS\$SSOLFDWLRQQRWH
*DPU\,QVWUXPHQWV:DUPLQVWHU3$86$SS *DPU\,QVWUXPHQWV:DUPLQVWHU3$86$SS

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ,; 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ,;


/LVWRI5HIHUHQFHV /LVWRI5HIHUHQFHV

>*DPU\@*DPU\  5HGHILQLQJ(OHFWURFKHPLFDO0HDVXUHPHQW*DPU\,QVWUXPHQWV >*DPU\@*DPU\  5HGHILQLQJ(OHFWURFKHPLFDO0HDVXUHPHQW*DPU\,QVWUXPHQWV


:DUPLQVWHU3$86$:HEVLWHKWWSZZZJDPU\FRPDFFHVVHG$SU :DUPLQVWHU3$86$:HEVLWHKWWSZZZJDPU\FRPDFFHVVHG$SU
>*DXWHIDOO 9HQQHVODQG@*DXWHIDOO2 9HQQHVODQG2  µ(IIHFWVRI&UDFNVRQWKH >*DXWHIDOO 9HQQHVODQG@*DXWHIDOO2 9HQQHVODQG2  µ(IIHFWVRI&UDFNVRQWKH
&RUURVLRQRI(PEHGGHG6WHHOLQ6LOLFD&RQFUHWHFRPSDUHGWR2UGLQDU\&RQFUHWH¶SS±,Q &RUURVLRQRI(PEHGGHG6WHHOLQ6LOLFD&RQFUHWHFRPSDUHGWR2UGLQDU\&RQFUHWH¶SS±,Q
3URFHHGLQJVRI1RUGLF&RQFUHWH5HVHDUFK0HHWLQJ2VOR1RUZD\ 3URFHHGLQJVRI1RUGLF&RQFUHWH5HVHDUFK0HHWLQJ2VOR1RUZD\
>*HKOHQ@*HKOHQ&  3UREDELOLVWLVFKH/HEHQVGDXHUEHPHVVXQJYRQ >*HKOHQ@*HKOHQ&  3UREDELOLVWLVFKH/HEHQVGDXHUEHPHVVXQJYRQ
6WDKOEHWRQEDXZHUNHQ=XYHUOlVVLJNHLWVEHWUDFKWXQJHQ]XUZLUNVDPHQ9HUPHLGXQJYRQ 6WDKOEHWRQEDXZHUNHQ=XYHUOlVVLJNHLWVEHWUDFKWXQJHQ]XUZLUNVDPHQ9HUPHLGXQJYRQ
%HZHKUXQJVNRUURVLRQ'$I6WE+HIW'HXWVFKHU$XVVFKXVVIU6WDKOEHWRQ%HUOLQ*HUPDQ\ %HZHKUXQJVNRUURVLRQ'$I6WE+HIW'HXWVFKHU$XVVFKXVVIU6WDKOEHWRQ%HUOLQ*HUPDQ\
SS*HUPDQODQJXDJH SS*HUPDQODQJXDJH
>*HLNHUHWDO@*HLNHU051LHOVHQ(3 +HUIRUW'  µ3UHGLFWLRQRI&KORULGH >*HLNHUHWDO@*HLNHU051LHOVHQ(3 +HUIRUW'  µ3UHGLFWLRQRI&KORULGH
,QJUHVVDQG%LQGLQJLQ&RQFUHWH¶0DWHULDOVDQG6WUXFWXUHV  SS± ,QJUHVVDQG%LQGLQJLQ&RQFUHWH¶0DWHULDOVDQG6WUXFWXUHV  SS±
>*HLNHU 7KDXORZ@*HLNHU05 7KDXORZ1  µ,QJUHVVRI0RLVWXUHGXHWR >*HLNHU 7KDXORZ@*HLNHU05 7KDXORZ1  µ,QJUHVVRI0RLVWXUHGXHWR
)UHH]H7KDZ([SRVXUH¶SS±,Q/LQGPDUN6 (G )URVW5HVLVWDQFHRI%XLOGLQJ0DWHULDOV )UHH]H7KDZ([SRVXUH¶SS±,Q/LQGPDUN6 (G )URVW5HVLVWDQFHRI%XLOGLQJ0DWHULDOV
1XPEHU5HSRUW79%0/XQG6ZHGHQ/XQG,QVWLWXWHRI7HFKQRORJ\ 1XPEHU5HSRUW79%0/XQG6ZHGHQ/XQG,QVWLWXWHRI7HFKQRORJ\
>*,@*,  'HHS3XUSOHDQG5DLQERZ,QGLFDWRU*HUPDQQ,QVWUXPHQWV&RSHQKDJHQ >*,@*,  'HHS3XUSOHDQG5DLQERZ,QGLFDWRU*HUPDQQ,QVWUXPHQWV&RSHQKDJHQ
'HQPDUN:HEVLWHKWWSJHUPDQQRUJDFFHVVHG1RY 'HQPDUN:HEVLWHKWWSJHUPDQQRUJDFFHVVHG1RY
>*ODVV %XHQIHOG@*ODVV*. %XHQIHOG15  µ7KHSUHVHQWDWLRQRIWKHFKORULGH >*ODVV %XHQIHOG@*ODVV*. %XHQIHOG15  µ7KHSUHVHQWDWLRQRIWKHFKORULGH
WKUHVKROGOHYHOIRUFRUURVLRQRIVWHHOLQFRQFUHWH¶&RUURVLRQ6FLHQFH  SS± WKUHVKROGOHYHOIRUFRUURVLRQRIVWHHOLQFRQFUHWH¶&RUURVLRQ6FLHQFH  SS±
>*pQLQHWDO@*pQLQ-055HIDLWD3%RXUULpE*$EGHOPRXODD0 7URODUG) >*pQLQHWDO@*pQLQ-055HIDLWD3%RXUULpE*$EGHOPRXODD0 7URODUG)
 µ6WUXFWXUHDQGVWDELOLW\RIWKH)H ,, ±)H ,,, JUHHQUXVW³IRXJHULWH´PLQHUDODQGLWVSRWHQWLDOIRU  µ6WUXFWXUHDQGVWDELOLW\RIWKH)H ,, ±)H ,,, JUHHQUXVW³IRXJHULWH´PLQHUDODQGLWVSRWHQWLDOIRU
UHGXFLQJSROOXWDQWVLQVRLOVROXWLRQV¶$SSOLHG*HRFKHPLVWU\  SS± UHGXFLQJSROOXWDQWVLQVRLOVROXWLRQV¶$SSOLHG*HRFKHPLVWU\  SS±
>*20@*20  $5$0,66\VWHPIRURSWLFDO'GHIRUPDWLRQDQDO\VLV*20*PE+ >*20@*20  $5$0,66\VWHPIRURSWLFDO'GHIRUPDWLRQDQDO\VLV*20*PE+
%UDXQVFKZHLJ*HUPDQ\:HEVLWHKWWSZZZJRPFRPDFFHVVHG6HS %UDXQVFKZHLJ*HUPDQ\:HEVLWHKWWSZZZJRPFRPDFFHVVHG6HS
>*RQ]DOH]HWDO@*RQ]DOH]-$0LUDQGD-02WHUR( )HOLX6  µ(IIHFWRI >*RQ]DOH]HWDO@*RQ]DOH]-$0LUDQGD-02WHUR( )HOLX6  µ(IIHFWRI
HOHFWURFKHPLFDOO\UHDFWLYHUXVWOD\HUVRQWKHFRUURVLRQRIVWHHOLQD&D 2+ VROXWLRQ¶&RUURVLRQ HOHFWURFKHPLFDOO\UHDFWLYHUXVWOD\HUVRQWKHFRUURVLRQRIVWHHOLQD&D 2+ VROXWLRQ¶&RUURVLRQ
6FLHQFH  SS± 6FLHQFH  SS±
>*RXGD@*RXGD9.  µ&RUURVLRQDQGFRUURVLRQLQKLELWLRQRIUHLQIRUFLQJVWHHO, >*RXGD@*RXGD9.  µ&RUURVLRQDQGFRUURVLRQLQKLELWLRQRIUHLQIRUFLQJVWHHO,
,PPHUVHGLQDONDOLQHVROXWLRQV¶%ULWLVK&RUURVLRQ-RXUQDOSS± ,PPHUVHGLQDONDOLQHVROXWLRQV¶%ULWLVK&RUURVLRQ-RXUQDOSS±
>*RXGD +DODND@*RXGD9. +DODND:<  µ&RUURVLRQDQGFRUURVLRQLQKLELWLRQ >*RXGD +DODND@*RXGD9. +DODND:<  µ&RUURVLRQDQGFRUURVLRQLQKLELWLRQ
RIUHLQIRUFHLQJVWHHO,,(PEHGGHGLQFRQFUHWH¶%ULWLVK&RUURVLRQ-RXUQDOSS± RIUHLQIRUFHLQJVWHHO,,(PEHGGHGLQFRQFUHWH¶%ULWLVK&RUURVLRQ-RXUQDOSS±
>*RZULSDODQHWDO@*RZULSDODQ16LULYLYDWQDQRQ9 /LP&  µ&KORULGHGLIIXVLYLW\ >*RZULSDODQHWDO@*RZULSDODQ16LULYLYDWQDQRQ9 /LP&  µ&KORULGHGLIIXVLYLW\
RIFRQFUHWHFUDFNHGLQIOH[XUH¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS± RIFRQFUHWHFUDFNHGLQIOH[XUH¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS±
>*68@*68  7KHUPRG\QDPLF3RWHQWLDOV*HRUJLD6WDWH8QLYHUVLW\$WODQWD*$ >*68@*68  7KHUPRG\QDPLF3RWHQWLDOV*HRUJLD6WDWH8QLYHUVLW\$WODQWD*$
:HEVLWHKWWSZZZJVXHGXDFFHVVHG$XJ :HEVLWHKWWSZZZJVXHGXDFFHVVHG$XJ
>*XHWDO@*X3%HDXGRLQ-7XPLGDMVNL3 0DLOYDJDQDP1  µ(OHFWURFKHPLFDO >*XHWDO@*X3%HDXGRLQ-7XPLGDMVNL3 0DLOYDJDQDP1  µ(OHFWURFKHPLFDO
LQFRPSDWLELOLW\RISDWFKHVLQUHLQIRUFHGFRQFUHWH¶&RQFUHWH,QWHUQDWLRQDO  SS± LQFRPSDWLELOLW\RISDWFKHVLQUHLQIRUFHGFRQFUHWH¶&RQFUHWH,QWHUQDWLRQDO  SS±
>*XGPXQGVVRQHWDO@*XGPXQGVVRQ*-DQ]0'DPJDDUG-HQVHQ$0HKXV-0LOOHU >*XGPXQGVVRQHWDO@*XGPXQGVVRQ*-DQ]0'DPJDDUG-HQVHQ$0HKXV-0LOOHU
-%0DDJH03HQWWL0 3RXOVHQ(  5HSDLUDQG0DLQWHQDQFHRI&RQFUHWH6WUXFWXUHV -%0DDJH03HQWWL0 3RXOVHQ(  5HSDLUDQG0DLQWHQDQFHRI&RQFUHWH6WUXFWXUHV
*XLGHOLQHVIRUPDQXIDFWXUHUVFRQWUDFWRUVDQGFRQVXOWDQWVRQWKHEDVLVRI(XURSHDQVWDQGDUGV *XLGHOLQHVIRUPDQXIDFWXUHUVFRQWUDFWRUVDQGFRQVXOWDQWVRQWKHEDVLVRI(XURSHDQVWDQGDUGV
3UHVHQWDWLRQ125(&217DVN71RUZHJLDQ3XEOLF5RDGV$GPLQLVWUDWLRQ2VOR1RUZD\SS 3UHVHQWDWLRQ125(&217DVN71RUZHJLDQ3XEOLF5RDGV$GPLQLVWUDWLRQ2VOR1RUZD\SS
>*XUYLFK@*XUYLFK/9  µ5HIHUHQFHERRNVDQGGDWDEDQNVRQWKHWKHUPRG\QDPLF >*XUYLFK@*XUYLFK/9  µ5HIHUHQFHERRNVDQGGDWDEDQNVRQWKHWKHUPRG\QDPLF
SURSHUWLHVRILQGLYLGXDOVXEVWDQFHV¶3XUHDQG$SSOLHG&KHPLVWU\  SS± SURSHUWLHVRILQGLYLGXDOVXEVWDQFHV¶3XUHDQG$SSOLHG&KHPLVWU\  SS±
>+DQVVRQHWDO@+DQVVRQ&3RXUVDHH$ /DXUHQW$  µ0DFURFHOODQGPLFURFHOO >+DQVVRQHWDO@+DQVVRQ&3RXUVDHH$ /DXUHQW$  µ0DFURFHOODQGPLFURFHOO
FRUURVLRQRIVWHHOLQRUGLQDU\3RUWODQGFHPHQWDQGKLJKSHUIRUPDQFHFRQFUHWHV¶&HPHQWDQG&RQFUHWH FRUURVLRQRIVWHHOLQRUGLQDU\3RUWODQGFHPHQWDQGKLJKSHUIRUPDQFHFRQFUHWHV¶&HPHQWDQG&RQFUHWH
5HVHDUFK  SS± 5HVHDUFK  SS±
>+DQVVRQHWDO@+DQVVRQ&00DPPROLWL/ +RSH%%  µ&RUURVLRQ,QKLELWRUV >+DQVVRQHWDO@+DQVVRQ&00DPPROLWL/ +RSH%%  µ&RUURVLRQ,QKLELWRUV
LQ&RQFUHWH3DUW,3ULQFLSOHV¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS± LQ&RQFUHWH3DUW,3ULQFLSOHV¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS±
>+DXQJ &XHQWDVD@+DXQJ++ &XHQWDV/ D µ&RQVWUXFWLRQRI(KS+DQGRWKHU >+DXQJ &XHQWDVD@+DXQJ++ &XHQWDV/ D µ&RQVWUXFWLRQRI(KS+DQGRWKHU
6WDELOLW\'LDJUDPVRI8UDQLXPLQD0XOWLFRPSRQHQW6\VWHPZLWKD0LFURFRPSXWHU,'RPDLQVRI 6WDELOLW\'LDJUDPVRI8UDQLXPLQD0XOWLFRPSRQHQW6\VWHPZLWKD0LFURFRPSXWHU,'RPDLQVRI
3UHGRPLQDQFH'LDJUDPV¶&DQDGLDQ0HWDOOXUJLFDO4XDUWHUO\  SS± 3UHGRPLQDQFH'LDJUDPV¶&DQDGLDQ0HWDOOXUJLFDO4XDUWHUO\  SS±

; 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ; 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN
 /LVWRI5HIHUHQFHV  /LVWRI5HIHUHQFHV

>+DXQJ &XHQWDVE@+DXQJ++ &XHQWDV/ E µ&RQVWUXFWLRQRI(KS+DQGRWKHU >+DXQJ &XHQWDVE@+DXQJ++ &XHQWDV/ E µ&RQVWUXFWLRQRI(KS+DQGRWKHU
6WDELOLW\'LDJUDPVRI8UDQLXPLQD0XOWLFRPSRQHQW6\VWHPZLWKD0LFURFRPSXWHU,,'LVWULEXWLRQ 6WDELOLW\'LDJUDPVRI8UDQLXPLQD0XOWLFRPSRQHQW6\VWHPZLWKD0LFURFRPSXWHU,,'LVWULEXWLRQ
'LDJUDPV¶&DQDGLDQ0HWDOOXUJLFDO4XDUWHUO\  SS± 'LDJUDPV¶&DQDGLDQ0HWDOOXUJLFDO4XDUWHUO\  SS±
>+DXVPDQQ@+DXVPDQQ'$  µ6WHHO&RUURVLRQLQ&RQFUHWH+RZ'RHV,W2FFXU"¶ >+DXVPDQQ@+DXVPDQQ'$  µ6WHHO&RUURVLRQLQ&RQFUHWH+RZ'RHV,W2FFXU"¶
0DWHULDOV3URWHFWLRQSS± 0DWHULDOV3URWHFWLRQSS±
>+HUKROGWHWDO@+HUKROGW$-XVWHVHQ&)3 1HSSHU&KULVWHQVHQ3  %HWRQ%RJHQ >+HUKROGWHWDO@+HUKROGW$-XVWHVHQ&)3 1HSSHU&KULVWHQVHQ3  %HWRQ%RJHQ
$DOERUJ'HQPDUN$DOERUJ3RUWODQG$6QGHGLWLRQSS'DQLVKODQJXDJH $DOERUJ'HQPDUN$DOERUJ3RUWODQG$6QGHGLWLRQSS'DQLVKODQJXDJH
>+LWHFK@+LWHFK  'LPHQVLRQDOO\6WDEOH$QRGHV+LWHFK(QJLQHHULQJ0DWHULDOVDQG >+LWHFK@+LWHFK  'LPHQVLRQDOO\6WDEOH$QRGHV+LWHFK(QJLQHHULQJ0DWHULDOVDQG
6\VWHPV/WG*UDQWKDP8.:HEVLWHKWWSZZZKLWHFKPHFRXNDFFHVVHG6HS 6\VWHPV/WG*UDQWKDP8.:HEVLWHKWWSZZZKLWHFKPHFRXNDFFHVVHG6HS
>+VLHKHWDO@+VLHK*0DVRQ72*DUERF]L(- 3HGHUVRQ/5   >+VLHKHWDO@+VLHK*0DVRQ72*DUERF]L(- 3HGHUVRQ/5  
µ([SHULPHQWDOOLPLWDWLRQVLQLPSHGDQFHVSHFWURVFRS\3DUW,,,±(IIHFWRIUHIHUHQFHHOHFWURGH µ([SHULPHQWDOOLPLWDWLRQVLQLPSHGDQFHVSHFWURVFRS\3DUW,,,±(IIHFWRIUHIHUHQFHHOHFWURGH
JHRPHWU\SRVLWLRQ¶6ROLG6WDWH,RQLFV  SS± JHRPHWU\SRVLWLRQ¶6ROLG6WDWH,RQLFV  SS±
>+VLHKHWDO@+VLHK*0DVRQ72 3HGHUVRQ/5  µ([SHULPHQWDOOLPLWDWLRQVLQ >+VLHKHWDO@+VLHK*0DVRQ72 3HGHUVRQ/5  µ([SHULPHQWDOOLPLWDWLRQVLQ
LPSHGDQFHVSHFWURVFRS\3DUW,,±(OHFWURGHDUWLIDFWVLQWKUHHSRLQWPHDVXUHPHQWVRQ3W<6=¶6ROLG LPSHGDQFHVSHFWURVFRS\3DUW,,±(OHFWURGHDUWLIDFWVLQWKUHHSRLQWPHDVXUHPHQWVRQ3W<6=¶6ROLG
6WDWH,RQLFV  SS± 6WDWH,RQLFV  SS±
>+8-,@+8-,  )DPRXV6FLHQWLVWV+HEUHZ8QLYHUVLW\-HUXVDOHP,VUDHO:HEVLWH >+8-,@+8-,  )DPRXV6FLHQWLVWV+HEUHZ8QLYHUVLW\-HUXVDOHP,VUDHO:HEVLWH
KWWSZZZKXMLDFLOKXMLDFFHVVHG6HS KWWSZZZKXMLDFLOKXMLDFFHVVHG6HS
>,,6,@,,6,  6WHHO6WDWLVWLFDO<HDUERRN,QWHUQDWLRQDO6WHHODQG,URQ,QVWLWXWH%UXVVHOV >,,6,@,,6,  6WHHO6WDWLVWLFDO<HDUERRN,QWHUQDWLRQDO6WHHODQG,URQ,QVWLWXWH%UXVVHOV
%HOJLXP:HEVLWHKWWSZZZZRUOGVWHHORUJDFFHVVHG0D\ %HOJLXP:HEVLWHKWWSZZZZRUOGVWHHORUJDFFHVVHG0D\
>,6$@,6$  *HZlVVHUJWHXQG$EZDVVHUZLUWVFKDIW/HFWXUHQRWHV,QVWLWXWIU >,6$@,6$  *HZlVVHUJWHXQG$EZDVVHUZLUWVFKDIW/HFWXUHQRWHV,QVWLWXWIU
6LHGOXQJVZDVVHUZLUWVFKDIW ,6$ 5:7+$DFKHQ*HUPDQ\*HUPDQODQJXDJH 6LHGOXQJVZDVVHUZLUWVFKDIW ,6$ 5:7+$DFKHQ*HUPDQ\*HUPDQODQJXDJH
>,VJRU 5D]DTSXU@,VJRU2% 5D]DTSXU$*  µ0RGHOOLQJVWHHOFRUURVLRQLQ >,VJRU 5D]DTSXU@,VJRU2% 5D]DTSXU$*  µ0RGHOOLQJVWHHOFRUURVLRQLQ
FRQFUHWHVWUXFWXUHV¶0DWHULDOVDQG6WUXFWXUHV  SS± FRQFUHWHVWUXFWXUHV¶0DWHULDOVDQG6WUXFWXUHV  SS±
>,62@,62  (SR[\FRDWHGVWHHOIRUWKHUHLQIRUFHPHQWRIFRQFUHWH >,62@,62  (SR[\FRDWHGVWHHOIRUWKHUHLQIRUFHPHQWRIFRQFUHWH
,QWHUQDWLRQDO6WDQGDUG,62,QWHUQDWLRQDO2UJDQL]DWLRQIRU6WDQGDUGL]DWLRQ*HQHYD ,QWHUQDWLRQDO6WDQGDUG,62,QWHUQDWLRQDO2UJDQL]DWLRQIRU6WDQGDUGL]DWLRQ*HQHYD
6ZLW]HUODQGSS 6ZLW]HUODQGSS
>,62@,62  =LQFFRDWHGVWHHOIRUWKHUHLQIRUFHPHQWRIFRQFUHWH >,62@,62  =LQFFRDWHGVWHHOIRUWKHUHLQIRUFHPHQWRIFRQFUHWH
,QWHUQDWLRQDO6WDQGDUG,62,QWHUQDWLRQDO2UJDQL]DWLRQIRU6WDQGDUGL]DWLRQ*HQHYD ,QWHUQDWLRQDO6WDQGDUG,62,QWHUQDWLRQDO2UJDQL]DWLRQIRU6WDQGDUGL]DWLRQ*HQHYD
6ZLW]HUODQGSS 6ZLW]HUODQGSS
>,62@,62  6WHHOIRUWKHUHLQIRUFHPHQWRIFRQFUHWH±3DUW3ODLQEDUV >,62@,62  6WHHOIRUWKHUHLQIRUFHPHQWRIFRQFUHWH±3DUW3ODLQEDUV
,QWHUQDWLRQDO6WDQGDUG,62,QWHUQDWLRQDO2UJDQL]DWLRQIRU6WDQGDUGL]DWLRQ*HQHYD ,QWHUQDWLRQDO6WDQGDUG,62,QWHUQDWLRQDO2UJDQL]DWLRQIRU6WDQGDUGL]DWLRQ*HQHYD
6ZLW]HUODQGSS 6ZLW]HUODQGSS
>,62@,62  6WHHOIRUWKHUHLQIRUFHPHQWRIFRQFUHWH±3DUW5LEEHG >,62@,62  6WHHOIRUWKHUHLQIRUFHPHQWRIFRQFUHWH±3DUW5LEEHG
EDUV,QWHUQDWLRQDO6WDQGDUG,62,QWHUQDWLRQDO2UJDQL]DWLRQIRU6WDQGDUGL]DWLRQ*HQHYD EDUV,QWHUQDWLRQDO6WDQGDUG,62,QWHUQDWLRQDO2UJDQL]DWLRQIRU6WDQGDUGL]DWLRQ*HQHYD
6ZLW]HUODQGSS 6ZLW]HUODQGSS
>,83$&@,83$&  &RQYHQWLRQRI6WRFNKROP,QWHUQDWLRQDO8QLRQRI3XUHDQG$SSOLHG >,83$&@,83$&  &RQYHQWLRQRI6WRFNKROP,QWHUQDWLRQDO8QLRQRI3XUHDQG$SSOLHG
&KHPLVWU\5HVHDUFK7ULDQJOH3DUN1&86$:HEVLWHKWWSFKLPJHXQLOFKDFFHVVHG6HS &KHPLVWU\5HVHDUFK7ULDQJOH3DUN1&86$:HEVLWHKWWSFKLPJHXQLOFKDFFHVVHG6HS
>,83$&@,83$&  ,83$&&RPSHQGLXPRI&KHPLFDO7HUPLQRORJ\,QWHUQDWLRQDO8QLRQ >,83$&@,83$&  ,83$&&RPSHQGLXPRI&KHPLFDO7HUPLQRORJ\,QWHUQDWLRQDO8QLRQ
RI3XUHDQG$SSOLHG&KHPLVWU\5HVHDUFK7ULDQJOH3DUN1&86$:HEVLWHKWWSJROGERRNLXSDFRUJ RI3XUHDQG$SSOLHG&KHPLVWU\5HVHDUFK7ULDQJOH3DUN1&86$:HEVLWHKWWSJROGERRNLXSDFRUJ
DFFHVVHG2FW DFFHVVHG2FW
>,=$@,=$  *DOYDQL]HG5HEDU5HVVRXUFH&HQWHU,QWHUQDWLRQDO=LQF$VVRFLDWLRQ >,=$@,=$  *DOYDQL]HG5HEDU5HVVRXUFH&HQWHU,QWHUQDWLRQDO=LQF$VVRFLDWLRQ
%UXVVHOV%HOJLXP:HEVLWHKWWSZZZJDOYDQL]HGUHEDUFRPDFFHVVHG$XJXVW %UXVVHOV%HOJLXP:HEVLWHKWWSZZZJDOYDQL]HGUHEDUFRPDFFHVVHG$XJXVW
>-HQVHQ@-HQVHQ20  &KORULGH,QJUHVVLQ&HPHQW3DVWHDQG0RUWDU0HDVXUHGE\ >-HQVHQ@-HQVHQ20  &KORULGH,QJUHVVLQ&HPHQW3DVWHDQG0RUWDU0HDVXUHGE\
(OHFWURQ3UREH0LFUR$QDO\VLV5HSRUWVHULHV5QR'HSDUWPHQWRI6WUXFWXUDO(QJLQHHULQJDQG (OHFWURQ3UREH0LFUR$QDO\VLV5HSRUWVHULHV5QR'HSDUWPHQWRI6WUXFWXUDO(QJLQHHULQJDQG
0DWHULDOV7HFKQLFDO8QLYHUVLW\RI'HQPDUN.JV/\QJE\'HQPDUNSS 0DWHULDOV7HFKQLFDO8QLYHUVLW\RI'HQPDUN.JV/\QJE\'HQPDUNSS
>-RKQ@-RKQ90  2QWKH6XVWDLQDELOLW\RIWKH&RQFUHWH([WHQGHGSDSHU8QLYHUVLW\ >-RKQ@-RKQ90  2QWKH6XVWDLQDELOLW\RIWKH&RQFUHWH([WHQGHGSDSHU8QLYHUVLW\
RI6mR3DXOR6mR3DXOR%UD]LOSS$YDLODEOHRQOLQHKWWSZZZSFFXVSEUDFFHVVHG0D\ RI6mR3DXOR6mR3DXOR%UD]LOSS$YDLODEOHRQOLQHKWWSZZZSFFXVSEUDFFHVVHG0D\
 
>-RQHV@-RQHV'$  3ULQFLSOHVDQG3UHYHQWLRQRI&RUURVLRQ8SSHU6DGGOH5LYHU1- >-RQHV@-RQHV'$  3ULQFLSOHVDQG3UHYHQWLRQRI&RUURVLRQ8SSHU6DGGOH5LYHU1-
86$3UHQWLFH+DOOQGHGLWLRQSS 86$3UHQWLFH+DOOQGHGLWLRQSS

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;,


/LVWRI5HIHUHQFHV /LVWRI5HIHUHQFHV

>.DHVFKH@.DHVFKH+  'LH.RUURVLRQGHU0HWDOOH%HUOLQ6SULQJHUQGHGLWLRQ >.DHVFKH@.DHVFKH+  'LH.RUURVLRQGHU0HWDOOH%HUOLQ6SULQJHUQGHGLWLRQ


SS*HUPDQODQJXDJH SS*HUPDQODQJXDJH
>.DL'D@.DL'D  3UHFLRXV*URXS0HWDO&DWDO\VWV&RPSRXQGVDQG$FWLYDWHG7LWDQLXP >.DL'D@.DL'D  3UHFLRXV*URXS0HWDO&DWDO\VWV&RPSRXQGVDQG$FWLYDWHG7LWDQLXP
$QRGHV.DL'D7HFKQRORJ\/WG/RQGRQ8.:HEVLWHKWWSZZZNDLGDFRXNDFFHVVHG6HS $QRGHV.DL'D7HFKQRORJ\/WG/RQGRQ8.:HEVLWHKWWSZZZNDLGDFRXNDFFHVVHG6HS
 
>.$,67@.$,67  3RWHQWLDOS+ 3RXUEDL[ 'LDJUDPV&RUURVLRQDQG(QHUJ\6WRUDJH >.$,67@.$,67  3RWHQWLDOS+ 3RXUEDL[ 'LDJUDPV&RUURVLRQDQG(QHUJ\6WRUDJH
0DWHULDOV/DERUDWRU\.RUHD$GYDQFHG,QVWLWXWHRI6FLHQFHDQG7HFKQRORJ\'DHMHRQ.RUHD:HEVLWH 0DWHULDOV/DERUDWRU\.RUHD$GYDQFHG,QVWLWXWHRI6FLHQFHDQG7HFKQRORJ\'DHMHRQ.RUHD:HEVLWH
KWWSFRUURVLRQNDLVWDFNUDFFHVVHG6HS KWWSFRUURVLRQNDLVWDFNUDFFHVVHG6HS
>.DQDQL@.DQDQL1  *DOYDQRWHFKQLN*UXQGODJHQ9HUIDKUHQ3UD[LV/HLS]LJ >.DQDQL@.DQDQL1  *DOYDQRWHFKQLN*UXQGODJHQ9HUIDKUHQ3UD[LV/HLS]LJ
*HUPDQ\)DFKEXFKYHUODJVWHGLWLRQSS*HUPDQODQJXDJH *HUPDQ\)DFKEXFKYHUODJVWHGLWLRQSS*HUPDQODQJXDJH
>.HOO\HWDO@.HOO\5*6FXOO\-56KRHVPLWK': %XFKKHLW5*   >.HOO\HWDO@.HOO\5*6FXOO\-56KRHVPLWK': %XFKKHLW5*  
(OHFWURFKHPLFDO7HFKQLTXHVLQ&RUURVLRQ6FLHQFHDQG(QJLQHHULQJ1XPEHULQ&RUURVLRQ (OHFWURFKHPLFDO7HFKQLTXHVLQ&RUURVLRQ6FLHQFHDQG(QJLQHHULQJ1XPEHULQ&RUURVLRQ
7HFKQRORJ\1HZ<RUN86$0DUFHO'HNNHU,QFVWHGLWLRQSS 7HFKQRORJ\1HZ<RUN86$0DUFHO'HNNHU,QFVWHGLWLRQSS
>.OLQJKRIIHU@.OLQJKRIIHU2  &RUURVLRQDVSHFWVRIJDOYDQLFFRXSOLQJEHWZHHQFDUERQ >.OLQJKRIIHU@.OLQJKRIIHU2  &RUURVLRQDVSHFWVRIJDOYDQLFFRXSOLQJEHWZHHQFDUERQ
VWHHODQGVWDLQOHVVVWHHOLQFRQFUHWH5HSRUW)25&(,QVWLWXWH%U¡QGE\'HQPDUNSS VWHHODQGVWDLQOHVVVWHHOLQFRQFUHWH5HSRUW)25&(,QVWLWXWH%U¡QGE\'HQPDUNSS
>.ROHYDHWDO@.ROHYD'$+X-)UDDLM$/$6WURHYHQ3%RVKNRY1 GH:LW- >.ROHYDHWDO@.ROHYD'$+X-)UDDLM$/$6WURHYHQ3%RVKNRY1 GH:LW-
+:  µ4XDQWLWDWLYHFKDUDFWHULVDWLRQRIVWHHOFHPHQWSDVWHLQWHUIDFHPLFURVWUXFWXUHDQG +:  µ4XDQWLWDWLYHFKDUDFWHULVDWLRQRIVWHHOFHPHQWSDVWHLQWHUIDFHPLFURVWUXFWXUHDQG
FRUURVLRQSKHQRPHQDLQPRUWDUVVXIIHULQJIURPFKORULGHDWWDFN¶&RUURVLRQ6FLHQFH  SS± FRUURVLRQSKHQRPHQDLQPRUWDUVVXIIHULQJIURPFKORULGHDWWDFN¶&RUURVLRQ6FLHQFH  SS±
 
>.URSS +LOVGRUI@.URSS- +LOVGRUI+. (GV   3HUIRUPDQFH&ULWHULDIRU >.URSS +LOVGRUI@.URSS- +LOVGRUI+. (GV   3HUIRUPDQFH&ULWHULDIRU
&RQFUHWH'XUDELOLW\1XPEHULQ5,/(05HSRUW/RQGRQ8.( )16SRQ &KDSPDQ +DOO VW &RQFUHWH'XUDELOLW\1XPEHULQ5,/(05HSRUW/RQGRQ8.( )16SRQ &KDSPDQ +DOO VW
HGLWLRQSS HGLWLRQSS
>.UXJHU@.UXJHU-  (OHFWURFKHPLVWU\RI&RUURVLRQ&DVH:HVWHUQ5HVHUYH8QLYHUVLW\ >.UXJHU@.UXJHU-  (OHFWURFKHPLVWU\RI&RUURVLRQ&DVH:HVWHUQ5HVHUYH8QLYHUVLW\
&OHYHODQG2+:HEVLWHKWWSHOHFWURFKHPFZUXHGXDFFHVVHG-XO &OHYHODQG2+:HEVLWHKWWSHOHFWURFKHPFZUXHGXDFFHVVHG-XO
>.WHU@.WHU$  ,QYHVWLJDWLRQVRQ&KORULGH,QJUHVVLQ&RQFUHWH&UDFNVXQGHU&\FOLF >.WHU@.WHU$  ,QYHVWLJDWLRQVRQ&KORULGH,QJUHVVLQ&RQFUHWH&UDFNVXQGHU&\FOLF
0HFKDQLFDO/RDGLQJ'LSORPDUEHLW5:7+$DFKHQ8QLYHUVLW\$DFKHQ*HUPDQ\SS 0HFKDQLFDO/RDGLQJ'LSORPDUEHLW5:7+$DFKHQ8QLYHUVLW\$DFKHQ*HUPDQ\SS
>.WHUHWDOD@.WHU$*HLNHU052OHVHQ-)6WDQJ+'DXEHUVFKPLGW&  >.WHUHWDOD@.WHU$*HLNHU052OHVHQ-)6WDQJ+'DXEHUVFKPLGW& 
5DXSDFK0 D µ&KORULGH,QJUHVVRI&RQFUHWH&UDFNVXQGHU&\FOLF/RDGLQJ¶SS RQ&' ,Q 5DXSDFK0 D µ&KORULGH,QJUHVVRI&RQFUHWH&UDFNVXQGHU&\FOLF/RDGLQJ¶SS RQ&' ,Q
3URFHHGLQJVRI&RQ0DW¶9DQFRXYHU%&&DQDGD 3URFHHGLQJVRI&RQ0DW¶9DQFRXYHU%&&DQDGD
>.WHUHWDOE@.WHU$0DVRQ720¡OOHU3 *HLNHU05 E µ&RUURVLRQRI >.WHUHWDOE@.WHU$0DVRQ720¡OOHU3 *HLNHU05 E µ&RUURVLRQRI
6WHHOLQ&RQFUHWH±3RWHQWLDO0RQLWRULQJDQG(OHFWURFKHPLFDO,PSHGDQFH6SHFWURVFRS\GXULQJ 6WHHOLQ&RQFUHWH±3RWHQWLDO0RQLWRULQJDQG(OHFWURFKHPLFDO,PSHGDQFH6SHFWURVFRS\GXULQJ
&RUURVLRQ,QLWLDWLRQDQG3URSDJDWLRQ¶SS RQ&' ,Q3URFHHGLQJVRI(XURFRUU/LVERQ &RUURVLRQ,QLWLDWLRQDQG3URSDJDWLRQ¶SS RQ&' ,Q3URFHHGLQJVRI(XURFRUU/LVERQ
3RUWXJDO 3RUWXJDO
>.WHUHWDO@.WHU$0¡OOHU3 *HLNHU05  µ&RUURVLRQRI6WHHOLQ&RQFUHWH± >.WHUHWDO@.WHU$0¡OOHU3 *HLNHU05  µ&RUURVLRQRI6WHHOLQ&RQFUHWH±
6SHFLPHQ'HVLJQIRU,QYHVWLJDWLRQRI,QWHUIDFHDQG%XON&RQYHUVLRQVGXULQJ&XULQJDQG 6SHFLPHQ'HVLJQIRU,QYHVWLJDWLRQRI,QWHUIDFHDQG%XON&RQYHUVLRQVGXULQJ&XULQJDQG
([SRVXUH¶SS RQ&' ,Q3URFHHGLQJVRI1RUGLF&RQFUHWH5HVHDUFK0HHWLQJ6DQGHIMRUG1RUZD\ ([SRVXUH¶SS RQ&' ,Q3URFHHGLQJVRI1RUGLF&RQFUHWH5HVHDUFK0HHWLQJ6DQGHIMRUG1RUZD\
>/L <XDQ@/L* <XDQ<6  µ(OHFWURFKHPLFDOLQFRPSDWLELOLW\IRUSDWFKUHSDLUHG >/L <XDQ@/L* <XDQ<6  µ(OHFWURFKHPLFDOLQFRPSDWLELOLW\IRUSDWFKUHSDLUHG
FRUURGHGUHLQIRUFHGFRQFUHWH¶=KRQJJXR.XDQJ\H'D[XH;XHEDR-RXUQDORI&KLQD8QLYHUVLW\RI FRUURGHGUHLQIRUFHGFRQFUHWH¶=KRQJJXR.XDQJ\H'D[XH;XHEDR-RXUQDORI&KLQD8QLYHUVLW\RI
0LQLQJDQG7HFKQRORJ\  SS± 0LQLQJDQG7HFKQRORJ\  SS±
>/L@/L9  $1HZ5HVHDUFK)UDPHZRUNIRU6XVWDLQDEOH,QIUDVWUXFWXUHV6HPLQDU >/L@/L9  $1HZ5HVHDUFK)UDPHZRUNIRU6XVWDLQDEOH,QIUDVWUXFWXUHV6HPLQDU
'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN.JV/\QJE\'HQPDUN 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN.JV/\QJE\'HQPDUN
>/LGH@/LGH'5  &5&+DQGERRNRI&KHPLVWU\DQG3K\VLFV%RFD5DWRQ)/86$ >/LGH@/LGH'5  &5&+DQGERRNRI&KHPLVWU\DQG3K\VLFV%RFD5DWRQ)/86$
&5&UGHGLWLRQSS &5&UGHGLWLRQSS
>/0*D@/0* D &HUWLILFHULQJVOLFHQV.DPVWnOHW.76'DWDVKHHW+/HPYLJK >/0*D@/0* D &HUWLILFHULQJVOLFHQV.DPVWnOHW.76'DWDVKHHW+/HPYLJK
0OOHU$6*ORVWUXS'HQPDUNSS'DQLVKODQJXDJH 0OOHU$6*ORVWUXS'HQPDUNSS'DQLVKODQJXDJH
>/0*E@/0* E &HUWLILNDW,QWHUQ.YDOLWHWVNRQWURO6WnONYDOLWHW'DWDVKHHW >/0*E@/0* E &HUWLILNDW,QWHUQ.YDOLWHWVNRQWURO6WnONYDOLWHW'DWDVKHHW
/HPYLJK0OOHU$6*ORVWUXS'HQPDUNSS'DQLVKODQJXDJH /HPYLJK0OOHU$6*ORVWUXS'HQPDUNSS'DQLVKODQJXDJH
>/RWKHQEDFK :LQQHIHOG@/RWKHQEDFK% :LQQHIHOG)  µ7KHUPRG\QDPLF >/RWKHQEDFK :LQQHIHOG@/RWKHQEDFK% :LQQHIHOG)  µ7KHUPRG\QDPLF
PRGHOOLQJRIWKHK\GUDWLRQRI3RUWODQGFHPHQW¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS± PRGHOOLQJRIWKHK\GUDWLRQRI3RUWODQGFHPHQW¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS±

;,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 /LVWRI5HIHUHQFHV  /LVWRI5HIHUHQFHV

>0$*@0$*  3URGXFWLRQDQGIXUWKHUSURFHVVLQJRI002DFWLYDWHGWLWDQLXP3HUVRQDO >0$*@0$*  3URGXFWLRQDQGIXUWKHUSURFHVVLQJRI002DFWLYDWHGWLWDQLXP3HUVRQDO


FRPPXQLFDWLRQ0$*1(72VSHFLDODQRGHV%96FKLHGDP7KH1HWKHUODQGV FRPPXQLFDWLRQ0$*1(72VSHFLDODQRGHV%96FKLHGDP7KH1HWKHUODQGV
>0DLOYDJDQDP@0DLOYDJDQDP13  µ&RQFUHWHUHSDLUDQGUHKDELOLWDWLRQ,VVXHVDQG >0DLOYDJDQDP@0DLOYDJDQDP13  µ&RQFUHWHUHSDLUDQGUHKDELOLWDWLRQ,VVXHVDQG
WUHQGV¶,QGLDQ&RQFUHWH-RXUQDO  SS± WUHQGV¶,QGLDQ&RQFUHWH-RXUQDO  SS±
>0DPPROLWLHWDO@0DPPROLWL/+DQVVRQ&0 +RSH%%  µ&RUURVLRQ >0DPPROLWLHWDO@0DPPROLWL/+DQVVRQ&0 +RSH%%  µ&RUURVLRQ
,QKLELWRUVLQ&RQFUHWH3DUW,,(IIHFWRQ&KORULGH7KUHVKROG9DOXHVIRU&RUURVLRQRI6WHHOLQ6\QWKHWLF ,QKLELWRUVLQ&RQFUHWH3DUW,,(IIHFWRQ&KORULGH7KUHVKROG9DOXHVIRU&RUURVLRQRI6WHHOLQ6\QWKHWLF
3RUH6ROXWLRQ¶&HPHQWDQG&RQFUHWH5HVHDUFKSS± 3RUH6ROXWLRQ¶&HPHQWDQG&RQFUHWH5HVHDUFKSS±
>0DUFK@0DUFK-  $GYDQFHG2UJDQLF&KHPLVWU\5HDFWLRQV0HFKDQLVPVDQG >0DUFK@0DUFK-  $GYDQFHG2UJDQLF&KHPLVWU\5HDFWLRQV0HFKDQLVPVDQG
6WUXFWXUH1HZ<RUN1<86$:LOH\WKHGLWLRQSS 6WUXFWXUH1HZ<RUN1<86$:LOH\WKHGLWLRQSS
>0DUFRWWH +DQVVRQ@0DUFRWWH7 +DQVVRQ&  µ&RUURVLRQSURGXFWVWKDWIRUPRQ >0DUFRWWH +DQVVRQ@0DUFRWWH7 +DQVVRQ&  µ&RUURVLRQSURGXFWVWKDWIRUPRQ
VWHHOZLWKLQFHPHQWSDVWH¶0DWHULDOVDQG6WUXFWXUHV  SS± VWHHOZLWKLQFHPHQWSDVWH¶0DWHULDOVDQG6WUXFWXUHV  SS±
>0DUNHVHWHWDO@0DUNHVHW*5RVWDP6 .OLQJKRIIHU2  *XLGHIRUWKHXVHRI >0DUNHVHWHWDO@0DUNHVHW*5RVWDP6 .OLQJKRIIHU2  *XLGHIRUWKHXVHRI
VWDLQOHVVVWHHOUHLQIRUFHPHQWLQFRQFUHWHVWUXFWXUHV3URMHFWUHSRUW1RUZHJLDQ%XLOGLQJ5HVHDUFK VWDLQOHVVVWHHOUHLQIRUFHPHQWLQFRQFUHWHVWUXFWXUHV3URMHFWUHSRUW1RUZHJLDQ%XLOGLQJ5HVHDUFK
,QVWLWXWH2VOR1RUZD\SS ,QVWLWXWH2VOR1RUZD\SS
>0DWVFKHLHWDOD@0DWVFKHL7/RWKHQEDFK% *ODVVHU)3 D µ7KH$)PSKDVHLQ >0DWVFKHLHWDOD@0DWVFKHL7/RWKHQEDFK% *ODVVHU)3 D µ7KH$)PSKDVHLQ
3RUWODQGFHPHQW¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS± 3RUWODQGFHPHQW¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS±
>0DWVFKHLHWDOE@0DWVFKHL7/RWKHQEDFK% *ODVVHU)3 E µ7KHUPRG\QDPLF >0DWVFKHLHWDOE@0DWVFKHL7/RWKHQEDFK% *ODVVHU)3 E µ7KHUPRG\QDPLF
SURSHUWLHVRI3RUWODQGFHPHQWK\GUDWHVLQWKHV\VWHP&D2±$O2±6L2±&D62±&D&2±+2¶ SURSHUWLHVRI3RUWODQGFHPHQWK\GUDWHVLQWKHV\VWHP&D2±$O2±6L2±&D62±&D&2±+2¶
&HPHQWDQG&RQFUHWH5HVHDUFK  SS± &HPHQWDQG&RQFUHWH5HVHDUFK  SS±
>0D\VHWDO@0D\V*&/HHV73%DNHU$)7DERU/-%HUNHOH\.*&.HHU >0D\VHWDO@0D\V*&/HHV73%DNHU$)7DERU/-%HUNHOH\.*&.HHU
-*6WURXG&*DUGQHU3%RDP.-'L[RQ-)1RUWKFRWW*'6 /HHPLQJ0%   -*6WURXG&*DUGQHU3%RDP.-'L[RQ-)1RUWKFRWW*'6 /HHPLQJ0%  
'XUDELOLW\RI&RQFUHWH6WUXFWXUHV,QYHVWLJDWLRQ5HSDLU3URWHFWLRQ/RQGRQ8.( )6SRQVW 'XUDELOLW\RI&RQFUHWH6WUXFWXUHV,QYHVWLJDWLRQ5HSDLU3URWHFWLRQ/RQGRQ8.( )6SRQVW
HGLWLRQSS HGLWLRQSS
>0F'RQDOGHWDO@0F'RQDOG'%9LUPDQL<3 3IHLIHU')  µ7HVWLQJWKH >0F'RQDOGHWDO@0F'RQDOG'%9LUPDQL<3 3IHLIHU')  µ7HVWLQJWKH
SHUIRUPDQFHRIFRSSHUFODGUHLQIRUFLQJEDUV¶&RQFUHWH,QWHUQDWLRQDO  SS± SHUIRUPDQFHRIFRSSHUFODGUHLQIRUFLQJEDUV¶&RQFUHWH,QWHUQDWLRQDO  SS±
>0(36@0(36  ,QGHSHQGHQW6WHHO,QGXVWU\$QDO\VWV&RQVXOWDQWV6WHHO3ULFHV5HSRUWV >0(36@0(36  ,QGHSHQGHQW6WHHO,QGXVWU\$QDO\VWV&RQVXOWDQWV6WHHO3ULFHV5HSRUWV
DQG3XEOLFDWLRQV0(36,QWO/WG6KHIILHOG8.:HEVLWHKWWSZZZPHSVFRXNDFFHVVHG DQG3XEOLFDWLRQV0(36,QWO/WG6KHIILHOG8.:HEVLWHKWWSZZZPHSVFRXNDFFHVVHG
$XJ $XJ
>0LHW]@0LHW]-  (OHFWURFKHPLFDOUHKDELOLWDWLRQPHWKRGVIRUUHLQIRUFHGFRQFUHWH >0LHW]@0LHW]-  (OHFWURFKHPLFDOUHKDELOLWDWLRQPHWKRGVIRUUHLQIRUFHGFRQFUHWH
VWUXFWXUHV6WDWHRIWKH$UW5HSRUW()&3XEOLFDWLRQ(XURSHDQ)HGHUDWLRQRI&RUURVLRQ ()&  VWUXFWXUHV6WDWHRIWKH$UW5HSRUW()&3XEOLFDWLRQ(XURSHDQ)HGHUDWLRQRI&RUURVLRQ ()& 
,QVWLWXWHRI0DWHULDOV/RQGRQ8.SS ,QVWLWXWHRI0DWHULDOV/RQGRQ8.SS
>0LQ'DW@0LQ'DW  0LQ'DWRUJ7KH0LQHUDODQG/RFDOLW\'DWDEDVH0LQ'DW/RQGRQ >0LQ'DW@0LQ'DW  0LQ'DWRUJ7KH0LQHUDODQG/RFDOLW\'DWDEDVH0LQ'DW/RQGRQ
8.:HEVLWHKWWSZZZPLQGDWRUJDFFHVVHG$XJ 8.:HEVLWHKWWSZZZPLQGDWRUJDFFHVVHG$XJ
>0LQGHVVHWDO@0LQGHVV6<RXQJ-) 'DUZLQ'  &RQFUHWH8SSHU6DGGOH >0LQGHVVHWDO@0LQGHVV6<RXQJ-) 'DUZLQ'  &RQFUHWH8SSHU6DGGOH
5LYHU1-86$3UHQWLFH+DOOQGHGLWLRQSS 5LYHU1-86$3UHQWLFH+DOOQGHGLWLRQSS
>0LQ*DO@0LQ*DO  7KH0LQHUDO*DOOHU\$PHWK\VW*DOOHULHV6W$XJXVWLQH)/86$ >0LQ*DO@0LQ*DO  7KH0LQHUDO*DOOHU\$PHWK\VW*DOOHULHV6W$XJXVWLQH)/86$
:HEVLWHKWWSZZZJDOOHULHVFRPPLQHUDOVDFFHVVHG$XJ :HEVLWHKWWSZZZJDOOHULHVFRPPLQHUDOVDFFHVVHG$XJ
>0LVDZD@0LVDZD7  µ7KHWKHUPRG\QDPLFFRQVLGHUDWLRQIRU)H+2V\VWHPDWƒ¶ >0LVDZD@0LVDZD7  µ7KHWKHUPRG\QDPLFFRQVLGHUDWLRQIRU)H+2V\VWHPDWƒ¶
&RUURVLRQ6FLHQFHSS± &RUURVLRQ6FLHQFHSS±
>0¡OOHUD@0¡OOHU3 D .RUURVLRQRJ7HUPRG\QDPLN.JV/\QJE\'HQPDUN'78 >0¡OOHUD@0¡OOHU3 D .RUURVLRQRJ7HUPRG\QDPLN.JV/\QJE\'HQPDUN'78
7U\NVWHGLWLRQSS'DQLVKODQJXDJH 7U\NVWHGLWLRQSS'DQLVKODQJXDJH
>0¡OOHUE@0¡OOHU3 E .RUURVLRQ WHRULRJWHNQRORJL /HFWXUHQRWHV7HFKQLFDO >0¡OOHUE@0¡OOHU3 E .RUURVLRQ WHRULRJWHNQRORJL /HFWXUHQRWHV7HFKQLFDO
8QLYHUVLW\RI'HQPDUN.JV/\QJE\'HQPDUN'DQLVKODQJXDJH 8QLYHUVLW\RI'HQPDUN.JV/\QJE\'HQPDUN'DQLVKODQJXDJH
>0¡OOHUF@0¡OOHU3 F 2YHUIODGHWHNQRORJL,QJHQL¡UHQ_E¡JHU&RSHQKDJHQ'HQPDUN >0¡OOHUF@0¡OOHU3 F 2YHUIODGHWHNQRORJL,QJHQL¡UHQ_E¡JHU&RSHQKDJHQ'HQPDUN
,QJHQL¡UHQVWHGLWLRQSS'DQLVKODQJXDJH ,QJHQL¡UHQVWHGLWLRQSS'DQLVKODQJXDJH
>0RKDPPHGHWDO@0RKDPPHG782WVXNL1+LVDGD0 6KLEDWD7  µ(IIHFWRI >0RKDPPHGHWDO@0RKDPPHG782WVXNL1+LVDGD0 6KLEDWD7  µ(IIHFWRI
&UDFN:LGWKDQG%DU7\SHRQ&RUURVLRQRI6WHHOLQ&RQFUHWH¶-RXUQDORI0DWHULDOVLQ&LYLO &UDFN:LGWKDQG%DU7\SHRQ&RUURVLRQRI6WHHOLQ&RQFUHWH¶-RXUQDORI0DWHULDOVLQ&LYLO
(QJLQHHULQJ  SS± (QJLQHHULQJ  SS±
>0ROLQDHWDO@0ROLQD)$ORQVR& $QGUDGH&  µ&RYHUFUDFNLQJDVDIXQFWLRQRI >0ROLQDHWDO@0ROLQD)$ORQVR& $QGUDGH&  µ&RYHUFUDFNLQJDVDIXQFWLRQRI
UHEDUFRUURVLRQ3DUW1XPHULFDOPRGHO¶0DWHULDOVDQG6WUXFWXUHV  SS± UHEDUFRUURVLRQ3DUW1XPHULFDOPRGHO¶0DWHULDOVDQG6WUXFWXUHV  SS±

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;,,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;,,,


/LVWRI5HIHUHQFHV /LVWRI5HIHUHQFHV

>0RQWHPRUHWDO@0RQWHPRU06LPRHV$ )HUUHLUD0  µ&KORULGHLQGXFHG >0RQWHPRUHWDO@0RQWHPRU06LPRHV$ )HUUHLUD0  µ&KORULGHLQGXFHG


FRUURVLRQRQUHLQIRUFLQJVWHHOIURPWKHIXQGDPHQWDOVWRWKHPRQLWRULQJWHFKQLTXHV¶&HPHQWDQG FRUURVLRQRQUHLQIRUFLQJVWHHOIURPWKHIXQGDPHQWDOVWRWKHPRQLWRULQJWHFKQLTXHV¶&HPHQWDQG
&RQFUHWH&RPSRVLWHV  SS± &RQFUHWH&RPSRVLWHV  SS±
>1DXPRY@1DXPRY*%  +DQGERRNRI7KHUPRG\QDPLF'DWD6SULQJILHOG9LUJLQLD >1DXPRY@1DXPRY*%  +DQGERRNRI7KHUPRG\QDPLF'DWD6SULQJILHOG9LUJLQLD
1DWLRQDO7HFKQLFDO,QIRUPDWLRQ6HUYLFHSS 1DWLRQDO7HFKQLFDO,QIRUPDWLRQ6HUYLFHSS
>1HYLOOH@1HYLOOH$0  3URSHUWLHVRI&RQFUHWH(VVH[8./RQJPDQWKHGLWLRQ >1HYLOOH@1HYLOOH$0  3URSHUWLHVRI&RQFUHWH(VVH[8./RQJPDQWKHGLWLRQ
SS SS
>1,@1,  /DE9,(:9HUVLRQ,QVWUXPHQWFRQWURODQGVLJQDOSURFHVVLQJVRIWZDUH >1,@1,  /DE9,(:9HUVLRQ,QVWUXPHQWFRQWURODQGVLJQDOSURFHVVLQJVRIWZDUH
1DWLRQDO,QVWUXPHQWV&RUSRUDWLRQ$XVWLQ7; 1DWLRQDO,QVWUXPHQWV&RUSRUDWLRQ$XVWLQ7;
>1LHOVHQ *HLNHU@1LHOVHQ( *HLNHU0  µ&KORULGH'LIIXVLRQLQ3DUWLDOO\6DWXUDWHG >1LHOVHQ *HLNHU@1LHOVHQ( *HLNHU0  µ&KORULGH'LIIXVLRQLQ3DUWLDOO\6DWXUDWHG
&HPHQWLWLRXV0DWHULDO¶&HPHQWDQG&RQFUHWH5HVHDUFKSS± &HPHQWLWLRXV0DWHULDO¶&HPHQWDQG&RQFUHWH5HVHDUFKSS±
>1LHOVHQHWDOD@1LHOVHQ(+HUIRUW' *HLNHU0 D µ%LQGLQJRIFKORULGHDQG >1LHOVHQHWDOD@1LHOVHQ(+HUIRUW' *HLNHU0 D µ%LQGLQJRIFKORULGHDQG
DONDOLVLQ3RUWODQGFHPHQWV\VWHPV¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS± DONDOLVLQ3RUWODQGFHPHQWV\VWHPV¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS±
>1LHOVHQ@1LHOVHQ(3  7UDQVSRUW0HFKDQLVPVLQ&HPHQWLWLRXV0DWHULDOV0DLQ >1LHOVHQ@1LHOVHQ(3  7UDQVSRUW0HFKDQLVPVLQ&HPHQWLWLRXV0DWHULDOV0DLQ
5HSRUW0DVWHUWKHVLV7HFKQLFDO8QLYHUVLW\RI'HQPDUN.JV/\QJE\'HQPDUNSS 5HSRUW0DVWHUWKHVLV7HFKQLFDO8QLYHUVLW\RI'HQPDUN.JV/\QJE\'HQPDUNSS
>1LHOVHQ@1LHOVHQ(3  7KHGXUDELOLW\RIZKLWH3RUWODQGFHPHQWWRFKHPLFDODWWDFN >1LHOVHQ@1LHOVHQ(3  7KHGXUDELOLW\RIZKLWH3RUWODQGFHPHQWWRFKHPLFDODWWDFN
3K'WKHVLV7HFKQLFDO8QLYHUVLW\RI'HQPDUN.JV/\QJE\'HQPDUNSS 3K'WKHVLV7HFKQLFDO8QLYHUVLW\RI'HQPDUN.JV/\QJE\'HQPDUNSS
>1LHOVHQHWDOE@1LHOVHQ(3+HUIRUW' *HLNHU05 E µ3KDVHHTXLOLEULDRI >1LHOVHQHWDOE@1LHOVHQ(3+HUIRUW' *HLNHU05 E µ3KDVHHTXLOLEULDRI
K\GUDWHG3RUWODQGFHPHQW¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS± K\GUDWHG3RUWODQGFHPHQW¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS±
>1LOVVRQHWDO@1LOVVRQ/23RXOVHQ(6DQGEHUJ36¡UHQVHQ+( .OLQJKRIIHU2 >1LOVVRQHWDO@1LOVVRQ/23RXOVHQ(6DQGEHUJ36¡UHQVHQ+( .OLQJKRIIHU2
 &KORULGH3HQHWUDWLRQLQWR&RQFUHWH6WDWHRIWKH$UW7UDQVSRUW3URFHVVHV&RUURVLRQ  &KORULGH3HQHWUDWLRQLQWR&RQFUHWH6WDWHRIWKH$UW7UDQVSRUW3URFHVVHV&RUURVLRQ
,QLWLDWLRQ7HVW0HWKRGVDQG3UHGLFWLRQ0RGHOV+(7(.5HSRUW1R'DQLVK5RDG'LUHFWRUDWH ,QLWLDWLRQ7HVW0HWKRGVDQG3UHGLFWLRQ0RGHOV+(7(.5HSRUW1R'DQLVK5RDG'LUHFWRUDWH
&RSHQKDJHQ'HQPDUNSS &RSHQKDJHQ'HQPDUNSS
>1LOVVRQHWDO@1LOVVRQ/26DQGEHUJ33RXOVHQ(7DQJ/$QGHUVHQ$  >1LOVVRQHWDO@1LOVVRQ/26DQGEHUJ33RXOVHQ(7DQJ/$QGHUVHQ$ 
)UHGHULNVHQ-0  $6\VWHPIRU(VWLPDWLRQRI&KORULGH,QJUHVVLQWR&RQFUHWH7KHRUHWLFDO )UHGHULNVHQ-0  $6\VWHPIRU(VWLPDWLRQRI&KORULGH,QJUHVVLQWR&RQFUHWH7KHRUHWLFDO
%DFNJURXQG+(7(.5HSRUW1R'DQLVK5RDG'LUHFWRUDWH&RSHQKDJHQ'HQPDUNSS %DFNJURXQG+(7(.5HSRUW1R'DQLVK5RDG'LUHFWRUDWH&RSHQKDJHQ'HQPDUNSS
>1UQEHUJHU@1UQEHUJHU8  6WDLQOHVV6WHHOLQ&RQFUHWH6WDWHRIWKH$UW5HSRUW()& >1UQEHUJHU@1UQEHUJHU8  6WDLQOHVV6WHHOLQ&RQFUHWH6WDWHRIWKH$UW5HSRUW()&
3XEOLFDWLRQV(XURSHDQ)HGHUDWLRQRI&RUURVLRQ ()& ,QVWLWXWHRI0DWHULDOV/RQGRQ8.SS 3XEOLFDWLRQV(XURSHDQ)HGHUDWLRQRI&RUURVLRQ ()& ,QVWLWXWHRI0DWHULDOV/RQGRQ8.SS
>1UQEHUJHU %HXO@1UQEHUJHU8 %HXO:  µ&RUURVLRQRIVWDLQOHVVVWHHO >1UQEHUJHU %HXO@1UQEHUJHU8 %HXO:  µ&RUURVLRQRIVWDLQOHVVVWHHO
UHLQIRUFHPHQWLQFUDFNHGFRQFUHWH¶2WWR*UDI-RXUQDOSS± UHLQIRUFHPHQWLQFUDFNHGFRQFUHWH¶2WWR*UDI-RXUQDOSS±
>1\JDDUG@1\JDDUG39  (IIHFWRI6WHHO&RQFUHWH,QWHUIDFH'HIHFWVRQWKH&KORULGH >1\JDDUG@1\JDDUG39  (IIHFWRI6WHHO&RQFUHWH,QWHUIDFH'HIHFWVRQWKH&KORULGH
7KUHVKROGIRU5HLQIRUFHPHQW&RUURVLRQ0DVWHUWKHVLV'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO 7KUHVKROGIRU5HLQIRUFHPHQW&RUURVLRQ0DVWHUWKHVLV'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO
8QLYHUVLW\RI'HQPDUN.JV/\QJE\'HQPDUNSS 8QLYHUVLW\RI'HQPDUN.JV/\QJE\'HQPDUNSS
>1\JDDUG@1\JDDUG39  &RUURVLRQ0RQLWRULQJDWWKH2UHVXQG)L[HG/LQN3HUVRQDO >1\JDDUG@1\JDDUG39  &RUURVLRQ0RQLWRULQJDWWKH2UHVXQG)L[HG/LQN3HUVRQDO
FRPPXQLFDWLRQ)25&(7HFKQRORJ\%U¡QGE\'HQPDUN FRPPXQLFDWLRQ)25&(7HFKQRORJ\%U¡QGE\'HQPDUN
>1\JDDUG *HLNHU@1\JDDUG39 *HLNHU05  µ$PHWKRGIRUPHDVXULQJWKH >1\JDDUG *HLNHU@1\JDDUG39 *HLNHU05  µ$PHWKRGIRUPHDVXULQJWKH
FKORULGHWKUHVKROGOHYHOUHTXLUHGWRLQLWLDWHUHLQIRUFHPHQWFRUURVLRQLQFRQFUHWH¶0DWHULDOVDQG FKORULGHWKUHVKROGOHYHOUHTXLUHGWRLQLWLDWHUHLQIRUFHPHQWFRUURVLRQLQFRQFUHWH¶0DWHULDOVDQG
6WUXFWXUHV  SS± 6WUXFWXUHV  SS±
>20&@20&  2UJDQLF0HWDO1DQRWHFKQRORJ\3RO\DQLOLQ250(&21*PE+ >20&@20&  2UJDQLF0HWDO1DQRWHFKQRORJ\3RO\DQLOLQ250(&21*PE+
$PPHUVEHN*HUPDQ\:HEVLWHKWWSZZZRUPHFRQGHDFFHVVHG-XO3DUWO\*HUPDQ $PPHUVEHN*HUPDQ\:HEVLWHKWWSZZZRUPHFRQGHDFFHVVHG-XO3DUWO\*HUPDQ
ODQJXDJH ODQJXDJH
>2WWRVHQHWDO@2WWRVHQ/03HGHUVHQ$- 5|ULJ'DOJDDUG,  µ6DOWUHODWHG >2WWRVHQHWDO@2WWRVHQ/03HGHUVHQ$- 5|ULJ'DOJDDUG,  µ6DOWUHODWHG
SUREOHPVLQEULFNPDVRQU\DQGHOHFWURNLQHWLFUHPRYDORIVDOWV¶-RXUQDORI%XLOGLQJ$SSUDLVDO   SUREOHPVLQEULFNPDVRQU\DQGHOHFWURNLQHWLFUHPRYDORIVDOWV¶-RXUQDORI%XLOGLQJ$SSUDLVDO  
SS± SS±
>2XNX@2XNX  +6&&KHPLVWU\9HUVLRQ&KHPLFDOUHDFWLRQDQGHTXLOLEULXPVRIWZDUH >2XNX@2XNX  +6&&KHPLVWU\9HUVLRQ&KHPLFDOUHDFWLRQDQGHTXLOLEULXPVRIWZDUH
2XWRNXPSX3RUL)LQODQG 2XWRNXPSX3RUL)LQODQG
>2XNX@2XNX  +6&&KHPLVWU\9HUVLRQ&KHPLFDOUHDFWLRQDQGHTXLOLEULXPVRIWZDUH >2XNX@2XNX  +6&&KHPLVWU\9HUVLRQ&KHPLFDOUHDFWLRQDQGHTXLOLEULXPVRIWZDUH
2XWRNXPSX3RUL)LQODQG 2XWRNXPSX3RUL)LQODQG
>3DJHHWDO@3DJH&/6KRUW15 (O7DUUD$  µ'LIIXVLRQRI&KORULGH,RQVLQ >3DJHHWDO@3DJH&/6KRUW15 (O7DUUD$  µ'LIIXVLRQRI&KORULGH,RQVLQ
+DUGHQHG&HPHQW3DVWH¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS± +DUGHQHG&HPHQW3DVWH¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS±

;,9 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;,9 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 /LVWRI5HIHUHQFHV  /LVWRI5HIHUHQFHV

>3DJH 7UHDGDZD\@3DJH&/ 7UHDGDZD\.:-  µ$VSHFWVRIWKH >3DJH 7UHDGDZD\@3DJH&/ 7UHDGDZD\.:-  µ$VSHFWVRIWKH
HOHFWURFKHPLVWU\RIVWHHOLQFRQFUHWH¶1DWXUHSS± HOHFWURFKHPLVWU\RIVWHHOLQFRQFUHWH¶1DWXUHSS±
>3DWWRQ@3DWWRQ7&  3LJPHQW+DQGERRN1HZ<RUN1<86$:LOH\SS >3DWWRQ@3DWWRQ7&  3LJPHQW+DQGERRN1HZ<RUN1<86$:LOH\SS
>3HDVHHWDO@3HDVH%-*HLNHU056WDQJ+ :HLVV-  µ3KRWRJUDPPHWULF >3HDVHHWDO@3HDVH%-*HLNHU056WDQJ+ :HLVV-  µ3KRWRJUDPPHWULF
$VVHVVPHQWRI)OH[XUH,QGXFHG&UDFNLQJRI5HLQIRUFHG&RQFUHWH%HDPVXQGHU6HUYLFH/RDGV¶SS $VVHVVPHQWRI)OH[XUH,QGXFHG&UDFNLQJRI5HLQIRUFHG&RQFUHWH%HDPVXQGHU6HUYLFH/RDGV¶SS
RQ&' ,Q3URFHHGLQJVRIWKHQG,QWHUQDWLRQDO5,/(06\PSRVLXP$GYDQFHVLQ&RQFUHWHWKURXJK RQ&' ,Q3URFHHGLQJVRIWKHQG,QWHUQDWLRQDO5,/(06\PSRVLXP$GYDQFHVLQ&RQFUHWHWKURXJK
6FLHQFHDQG(QJLQHHULQJ4XpEHF&LW\4XpEHF&DQDGD 6FLHQFHDQG(QJLQHHULQJ4XpEHF&LW\4XpEHF&DQDGD
>3HGHIHUUL@3HGHIHUUL3  µ&DWKRGLF3URWHFWLRQRI1HZ&RQFUHWH&RQVWUXFWLRQV¶3DSHU >3HGHIHUUL@3HGHIHUUL3  µ&DWKRGLF3URWHFWLRQRI1HZ&RQFUHWH&RQVWUXFWLRQV¶3DSHU
(SS RQ&' ,Q3URFHHGLQJVRI,QWHUQDWLRQDO&RQIHUHQFHRQ6WUXFWXUDO,PSURYHPHQWWKURXJK (SS RQ&' ,Q3URFHHGLQJVRI,QWHUQDWLRQDO&RQIHUHQFHRQ6WUXFWXUDO,PSURYHPHQWWKURXJK
&RUURVLRQ3URWHFWLRQRI5HLQIRUFHG&RQFUHWH/RQGRQ8. &RUURVLRQ3URWHFWLRQRI5HLQIRUFHG&RQFUHWH/RQGRQ8.
>3ODFH+DQVHQGH@3ODFH+DQVHQGH(-  +ROGEDUKHGDIILEHUDUPHUHWEHWRQ >3ODFH+DQVHQGH@3ODFH+DQVHQGH(-  +ROGEDUKHGDIILEHUDUPHUHWEHWRQ
(NVSHULPHQWHOOHXQGHUV¡JHOVHU5HSRUWVHULHV5QR'HSDUWPHQWRI6WUXFWXUDO(QJLQHHULQJDQG (NVSHULPHQWHOOHXQGHUV¡JHOVHU5HSRUWVHULHV5QR'HSDUWPHQWRI6WUXFWXUDO(QJLQHHULQJDQG
0DWHULDOV7HFKQLFDO8QLYHUVLW\RI'HQPDUN.JV/\QJE\'HQPDUNSS'DQLVKODQJXDJHZLWK 0DWHULDOV7HFKQLFDO8QLYHUVLW\RI'HQPDUN.JV/\QJE\'HQPDUNSS'DQLVKODQJXDJHZLWK
(QJOLVKVXPPDU\ (QJOLVKVXPPDU\
>3RSRY@3RSRY%1  (IIHFWLYHQHVVRI&DOFLXP1LWULWHLQ3URWHFWLQJ*DOYDQL]HG6WHHO >3RSRY@3RSRY%1  (IIHFWLYHQHVVRI&DOFLXP1LWULWHLQ3URWHFWLQJ*DOYDQL]HG6WHHO
LQ&RQFUHWH8QLYHUVLW\RI6RXWK&DUROLQD&ROXPELD6&86$:HEVLWHKWWSZZZFKHVFHGX LQ&RQFUHWH8QLYHUVLW\RI6RXWK&DUROLQD&ROXPELD6&86$:HEVLWHKWWSZZZFKHVFHGX
DFFHVVHG$XJ DFFHVVHG$XJ
>3RXUEDL[D@3RXUEDL[0 D µ$SSOLFDWLRQVRIHOHFWURFKHPLVWU\LQFRUURVLRQVFLHQFHDQG >3RXUEDL[D@3RXUEDL[0 D µ$SSOLFDWLRQVRIHOHFWURFKHPLVWU\LQFRUURVLRQVFLHQFHDQG
SUDFWLFH¶&RUURVLRQ6FLHQFHSS± SUDFWLFH¶&RUURVLRQ6FLHQFHSS±
>3RXUEDL[E@3RXUEDL[0 E $WODVRI(OHFWURFKHPLFDO(TXLOLEULD+RXVWRQ7;86$ >3RXUEDL[E@3RXUEDL[0 E $WODVRI(OHFWURFKHPLFDO(TXLOLEULD+RXVWRQ7;86$
1$&(,QWHUQDWLRQDOQGHGLWLRQSS 1$&(,QWHUQDWLRQDOQGHGLWLRQSS
>3RXUVDHH +DQVVRQ@3RXUVDHH$ +DQVVRQ&  µ5HLQIRUFLQJVWHHOSDVVLYDWLRQLQ >3RXUVDHH +DQVVRQ@3RXUVDHH$ +DQVVRQ&  µ5HLQIRUFLQJVWHHOSDVVLYDWLRQLQ
PRUWDUDQGSRUHVROXWLRQ¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS± PRUWDUDQGSRUHVROXWLRQ¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS±
>3UXFNQHU *M¡UY@3UXFNQHU) *M¡UY2(  µ3DWFKUHSDLUDQGPDFURFHOODFWLYLW\LQ >3UXFNQHU *M¡UY@3UXFNQHU) *M¡UY2(  µ3DWFKUHSDLUDQGPDFURFHOODFWLYLW\LQ
FRQFUHWHVWUXFWXUHV¶$&,0DWHULDOV-RXUQDO  SS± FRQFUHWHVWUXFWXUHV¶$&,0DWHULDOV-RXUQDO  SS±
>4LX@4LX  (PHUJLQJ&RUURVLRQ&RQWURO7HFKQRORJLHVIRU5HSDLUDQG5HKDELOLWDWLRQRI >4LX@4LX  (PHUJLQJ&RUURVLRQ&RQWURO7HFKQRORJLHVIRU5HSDLUDQG5HKDELOLWDWLRQRI
&RQFUHWH6WUXFWXUHV5HSRUW1DQ\DQJ7HFKQRORJLFDO8QLYHUVLW\6LQJDSRUHSS$YDLODEOHRQOLQH &RQFUHWH6WUXFWXUHV5HSRUW1DQ\DQJ7HFKQRORJLFDO8QLYHUVLW\6LQJDSRUHSS$YDLODEOHRQOLQH
KWWSZZZFRUURVLRQVRXUFHFRPDFFHVVHG6HS KWWSZZZFRUURVLRQVRXUFHFRPDFFHVVHG6HS
>5$@5$  9ROWDPDVWHU9HUVLRQ(OHFWURFKHPLFDODQDO\VLVVRIWZDUH5DGLRPHWHU >5$@5$  9ROWDPDVWHU9HUVLRQ(OHFWURFKHPLFDODQDO\VLVVRIWZDUH5DGLRPHWHU
$QDO\WLFDO6$69LOOHXUEDQQH)UDQFH $QDO\WLFDO6$69LOOHXUEDQQH)UDQFH
>5$D@5$ D 5()5HIHUHQFH(OHFWURGHV'DWDVKHHW5DGLRPHWHU$QDO\WLFDO6$6 >5$D@5$ D 5()5HIHUHQFH(OHFWURGHV'DWDVKHHW5DGLRPHWHU$QDO\WLFDO6$6
9LOOHXUEDQQH&HGH[)UDQFHSS 9LOOHXUEDQQH&HGH[)UDQFHSS
>5$E@5$ E ;55HIHUHQFH(OHFWURGHV'DWDVKHHW5DGLRPHWHU$QDO\WLFDO6$6 >5$E@5$ E ;55HIHUHQFH(OHFWURGHV'DWDVKHHW5DGLRPHWHU$QDO\WLFDO6$6
9LOOHXUEDQQH&HGH[)UDQFHSS 9LOOHXUEDQQH&HGH[)UDQFHSS
>5$@5$  9RODW/DE0DNLQJYROWDPPHWU\IRU\RX5DGLRPHWHU$QDO\WLFDO6$6 >5$@5$  9RODW/DE0DNLQJYROWDPPHWU\IRU\RX5DGLRPHWHU$QDO\WLFDO6$6
9LOOHXUEDQQH)UDQFH:HEVLWHKWWSZZZUDGLRPHWHUDQDO\WLFDOFRPDFFHVVHG$SU 9LOOHXUEDQQH)UDQFH:HEVLWHKWWSZZZUDGLRPHWHUDQDO\WLFDOFRPDFFHVVHG$SU
>5DKDULQDLYRHWDO@5DKDULQDLYR$*pQLQ-0 *ULPDOGL*  µ0HFKDQLVPRI >5DKDULQDLYRHWDO@5DKDULQDLYR$*pQLQ-0 *ULPDOGL*  µ0HFKDQLVPRI
FKORULGHDFWLRQVRQVWHHOFRUURVLRQLQFRQFUHWH¶SS±,Q3URFHHGLQJVRIWK,QWHUQDWLRQDO FKORULGHDFWLRQVRQVWHHOFRUURVLRQLQFRQFUHWH¶SS±,Q3URFHHGLQJVRIWK,QWHUQDWLRQDO
&RQIHUHQFHRQ'XUDELOLW\RI%XLOGLQJ0DWHULDOVDQG&RPSRQHQWV6LQJDSRUH6LQJDSRUH &RQIHUHQFHRQ'XUDELOLW\RI%XLOGLQJ0DWHULDOVDQG&RPSRQHQWV6LQJDSRUH6LQJDSRUH
>5DPE¡OO@5DPE¡OO  3LHULQ3URJUHVR0H[LFR(YDOXDWLRQRIWKH6WDLQOHVV6WHHO >5DPE¡OO@5DPE¡OO  3LHULQ3URJUHVR0H[LFR(YDOXDWLRQRIWKH6WDLQOHVV6WHHO
5HLQIRUFHPHQW,QVSHFWLRQUHSRUW5DPE¡OO$69LUXP'HQPDUNSS 5HLQIRUFHPHQW,QVSHFWLRQUHSRUW5DPE¡OO$69LUXP'HQPDUNSS
>5DQGKDZD 6ZHHW\@5DQGKDZD%6 6ZHHW\.  µ3UHSDUDWLRQRIVRGLXPIHUULWH >5DQGKDZD 6ZHHW\@5DQGKDZD%6 6ZHHW\.  µ3UHSDUDWLRQRIVRGLXPIHUULWH
IURPWKHWKHUPRO\VLVRIVRGLXPWULV PDOHDWRIXPDUDWR IHUUDWHV ,,, ¶-RXUQDORI5DGLRDQDO\WLFDODQG IURPWKHWKHUPRO\VLVRIVRGLXPWULV PDOHDWRIXPDUDWR IHUUDWHV ,,, ¶-RXUQDORI5DGLRDQDO\WLFDODQG
1XFOHDU&KHPLVWU\  SS± 1XFOHDU&KHPLVWU\  SS±
>5DXSDFK@5DXSDFK0  =XUFKORULGLQGX]LHUWHQ0DNURHOHPHQWNRUURVLRQYRQ6WDKOLQ >5DXSDFK@5DXSDFK0  =XUFKORULGLQGX]LHUWHQ0DNURHOHPHQWNRUURVLRQYRQ6WDKOLQ
%HWRQ'$I6WE+HIW'HXWVFKHU$XVVFKXVVIU6WDKOEHWRQ%HUOLQ*HUPDQ\SS*HUPDQ %HWRQ'$I6WE+HIW'HXWVFKHU$XVVFKXVVIU6WDKOEHWRQ%HUOLQ*HUPDQ\SS*HUPDQ
ODQJXDJH ODQJXDJH
>5DXSDFK@5DXSDFK0  µ&KORULGHLQGXFHGPDFURFHOOFRUURVLRQRIVWHHOLQFRQFUHWH± >5DXSDFK@5DXSDFK0  µ&KORULGHLQGXFHGPDFURFHOOFRUURVLRQRIVWHHOLQFRQFUHWH±
WKHRUHWLFDOEDFNJURXQGDQGSUDFWLFDOFRQVHTXHQFHV¶&RQVWUXFWLRQDQG%XLOGLQJ0DWHULDOV   WKHRUHWLFDOEDFNJURXQGDQGSUDFWLFDOFRQVHTXHQFHV¶&RQVWUXFWLRQDQG%XLOGLQJ0DWHULDOV  
SS± SS±

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;9 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;9


/LVWRI5HIHUHQFHV /LVWRI5HIHUHQFHV

>5DXSDFK@5DXSDFK0  &RQFUHWH5HSDLU$FFRUGLQJWRWKH1HZ(XURSHDQ6WDQGDUG(1 >5DXSDFK@5DXSDFK0  &RQFUHWH5HSDLU$FFRUGLQJWRWKH1HZ(XURSHDQ6WDQGDUG(1


1RWH)5:7+$DFKHQ8QLYHUVLW\$DFKHQ*HUPDQ\SS$YDLODEOHRQOLQH 1RWH)5:7+$DFKHQ8QLYHUVLW\$DFKHQ*HUPDQ\SS$YDLODEOHRQOLQH
KWWSZZZLEDFUZWKDDFKHQGHDFFHVVHG$XJ KWWSZZZLEDFUZWKDDFKHQGHDFFHVVHG$XJ
>5DXSDFKHWDO@5DXSDFK0(OVHQHU%3ROGHU5% 0LHW]- (GV   &RUURVLRQ >5DXSDFKHWDO@5DXSDFK0(OVHQHU%3ROGHU5% 0LHW]- (GV   &RUURVLRQ
RIUHLQIRUFHPHQWLQFRQFUHWH0HFKDQLVPVPRQLWRULQJLQKLELWRUVDQGUHKDELOLWDWLRQWHFKQLTXHV RIUHLQIRUFHPHQWLQFRQFUHWH0HFKDQLVPVPRQLWRULQJLQKLELWRUVDQGUHKDELOLWDWLRQWHFKQLTXHV
1XPEHULQ(XURSHDQ)HGHUDWLRQRI&RUURVLRQ3XEOLFDWLRQV&DPEULGJH8.:RRGKHDGVWHGLWLRQ 1XPEHULQ(XURSHDQ)HGHUDWLRQRI&RUURVLRQ3XEOLFDWLRQV&DPEULGJH8.:RRGKHDGVWHGLWLRQ
SS SS
>5DXSDFK :ROII@5DXSDFK0 :ROII/  5HGXNWLRQGHU%HZHKUXQJVEHUGHFNXQJ >5DXSDFK :ROII@5DXSDFK0 :ROII/  5HGXNWLRQGHU%HZHKUXQJVEHUGHFNXQJ
EHLYRUKDQGHQHU%HVFKLFKWXQJEHL3DUNKDXV1HXEDXWHQ1XPEHU76WXWWJDUW)UDXQKRIHU,5% EHLYRUKDQGHQHU%HVFKLFKWXQJEHL3DUNKDXV1HXEDXWHQ1XPEHU76WXWWJDUW)UDXQKRIHU,5%
VWHGLWLRQSS*HUPDQODQJXDJH VWHGLWLRQSS*HUPDQODQJXDJH
>5HIDLWHWDO@5HIDLW3$EGHOPRXOD0 *HQLQ-0  µ0HFKDQLVPVRIIRUPDWLRQ >5HIDLWHWDO@5HIDLW3$EGHOPRXOD0 *HQLQ-0  µ0HFKDQLVPVRIIRUPDWLRQ
DQGVWUXFWXUHRIJUHHQUXVWRQHLQDTXHRXVFRUURVLRQRILURQLQWKHSUHVHQFHRIFKORULGHLRQV¶&RUURVLRQ DQGVWUXFWXUHRIJUHHQUXVWRQHLQDTXHRXVFRUURVLRQRILURQLQWKHSUHVHQFHRIFKORULGHLRQV¶&RUURVLRQ
6FLHQFH  SS± 6FLHQFH  SS±
>5HIDLW *pQLQ@5HIDLW3 *pQLQ-0  µ7KHPHFKDQLVPVRIR[LGDWLRQRIIHUURXV >5HIDLW *pQLQ@5HIDLW3 *pQLQ-0  µ7KHPHFKDQLVPVRIR[LGDWLRQRIIHUURXV
K\GUR[\FKORULGHEHWD)H 2+ &OLQDTXHRXVVROXWLRQWKHIRUPDWLRQRIDNDJDQHLWHYVJRHWKLWH¶ K\GUR[\FKORULGHEHWD)H 2+ &OLQDTXHRXVVROXWLRQWKHIRUPDWLRQRIDNDJDQHLWHYVJRHWKLWH¶
&RUURVLRQ6FLHQFH  SS± &RUURVLRQ6FLHQFH  SS±
>5HIDLW *pQLQ@5HIDLW3 *pQLQ-05  µ7KHR[LGDWLRQRIIHUURXVK\GUR[LGHLQ >5HIDLW *pQLQ@5HIDLW3 *pQLQ-05  µ7KHR[LGDWLRQRIIHUURXVK\GUR[LGHLQ
FKORULGHFRQWDLQLQJDTXHRXVPHGLDDQGSRXUEDL[GLDJUDPVRIJUHHQUXVWRQH¶&RUURVLRQ6FLHQFH FKORULGHFRQWDLQLQJDTXHRXVPHGLDDQGSRXUEDL[GLDJUDPVRIJUHHQUXVWRQH¶&RUURVLRQ6FLHQFH
  SS±   SS±
>5HKPHWDO@5HKP*1UQEHUJHU81HXEHUW% 1HQQLQJHU)   >5HKPHWDO@5HKP*1UQEHUJHU81HXEHUW% 1HQQLQJHU)  
&KORULGNRUURVLRQYRQ6WDKOLQJHULVVHQHP%HWRQ'$I6WE+HIW'HXWVFKHU$XVVFKXVVIU &KORULGNRUURVLRQYRQ6WDKOLQJHULVVHQHP%HWRQ'$I6WE+HIW'HXWVFKHU$XVVFKXVVIU
6WDKOEHWRQ%HUOLQ*HUPDQ\SS*HUPDQODQJXDJH 6WDKOEHWRQ%HUOLQ*HUPDQ\SS*HUPDQODQJXDJH
>5HQGHOOHWDO@5HQGHOO)-DXEHUWKLH5 *UDQWKDP0  'HWHULRUDWHG&RQFUHWH >5HQGHOOHWDO@5HQGHOO)-DXEHUWKLH5 *UDQWKDP0  'HWHULRUDWHG&RQFUHWH
,QVSHFWLRQDQGSK\VLFRFKHPLFDODQDO\VLV/RQGRQ8.7KRPDV7HOIRUGVWHGLWLRQSS ,QVSHFWLRQDQGSK\VLFRFKHPLFDODQDO\VLV/RQGRQ8.7KRPDV7HOIRUGVWHGLWLRQSS
>5LFKDUGVRQ@5LFKDUGVRQ0  )XQGDPHQWDOVRI'XUDEOH5HLQIRUFHG&RQFUHWH0RGHUQ >5LFKDUGVRQ@5LFKDUGVRQ0  )XQGDPHQWDOVRI'XUDEOH5HLQIRUFHG&RQFUHWH0RGHUQ
&RQFUHWH7HFKQRORJ\6HULHV3RUWODQG2586$7D\ORU )UDQFLVVWHGLWLRQSS &RQFUHWH7HFKQRORJ\6HULHV3RUWODQG2586$7D\ORU )UDQFLVVWHGLWLRQSS
>5pPD]HLOOHV 5HIDLW@5pPD]HLOOHV& 5HIDLW3  µ2QWKHIRUPDWLRQRIEHWD)H22+ >5pPD]HLOOHV 5HIDLW@5pPD]HLOOHV& 5HIDLW3  µ2QWKHIRUPDWLRQRIEHWD)H22+
DNDJDQHLWH LQFKORULGHFRQWDLQLQJHQYLURQPHQWV¶&RUURVLRQ6FLHQFH  SS± DNDJDQHLWH LQFKORULGHFRQWDLQLQJHQYLURQPHQWV¶&RUURVLRQ6FLHQFH  SS±
>5REHUJH@5REHUJH35  &RUURVLRQ'RFWRUV5R\DO0LOLWDU\&ROOHJH.LQJVWRQ >5REHUJH@5REHUJH35  &RUURVLRQ'RFWRUV5R\DO0LOLWDU\&ROOHJH.LQJVWRQ
2QWDULR:HEVLWHKWWSZZZFRUURVLRQGRFWRUVRUJDFFHVVHG$XJ 2QWDULR:HEVLWHKWWSZZZFRUURVLRQGRFWRUVRUJDFFHVVHG$XJ
>5RGULJXH] +RRWRQ@5RGULJXH]2 +RRWRQ5  µ,QIOXHQFHRI&UDFNVRQ&KORULGH >5RGULJXH] +RRWRQ@5RGULJXH]2 +RRWRQ5  µ,QIOXHQFHRI&UDFNVRQ&KORULGH
,QJUHVVLQWR&RQFUHWH¶$&,0DWHULDOV-RXUQDO  SS± ,QJUHVVLQWR&RQFUHWH¶$&,0DWHULDOV-RXUQDO  SS±
>5RLQH@5RLQH$  2XWRNXPSX+6&&KHPLVWU\9HUVLRQ&KHPLFDO5HDFWLRQDQG >5RLQH@5RLQH$  2XWRNXPSX+6&&KHPLVWU\9HUVLRQ&KHPLFDO5HDFWLRQDQG
(TXLOLEULXP6RIWZDUHZLWK([WHQVLYH7KHUPRFKHPLFDO'DWDEDVH8VHU¶V*XLGH0DQXDO2XWRNXPSX (TXLOLEULXP6RIWZDUHZLWK([WHQVLYH7KHUPRFKHPLFDO'DWDEDVH8VHU¶V*XLGH0DQXDO2XWRNXPSX
3RUL)LQODQGSS 3RUL)LQODQGSS
>5RVWDP@5RVWDP6  µ6HUYLFHOLIHGHVLJQIRUWKHQH[WFHQWXU\¶,Q6DNDL3. (G  >5RVWDP@5RVWDP6  µ6HUYLFHOLIHGHVLJQIRUWKHQH[WFHQWXU\¶,Q6DNDL3. (G 
3URFHHGLQJVRIWKH,QWHUQDWLRQDO:RUNVKRS5DWLRQDO'HVLJQRI&RQFUHWH6WUXFWXUHVXQGHU6HYHUH 3URFHHGLQJVRIWKH,QWHUQDWLRQDO:RUNVKRS5DWLRQDO'HVLJQRI&RQFUHWH6WUXFWXUHVXQGHU6HYHUH
&RQGLWLRQV/RQGRQ8.( )16SRQ &RQGLWLRQV/RQGRQ8.( )16SRQ
>5RVWDP@5RVWDP6  µ5HLQIRUFHGFRQFUHWHVWUXFWXUHV6KDOOFRQFUHWHUHPDLQWKH >5RVWDP@5RVWDP6  µ5HLQIRUFHGFRQFUHWHVWUXFWXUHV6KDOOFRQFUHWHUHPDLQWKH
GRPLQDWLQJPHDQVRIFRUURVLRQSUHYHQWLRQ"¶0DWHULDOVDQG&RUURVLRQ  SS± GRPLQDWLQJPHDQVRIFRUURVLRQSUHYHQWLRQ"¶0DWHULDOVDQG&RUURVLRQ  SS±
>5RVWDP@5RVWDP6  'XUDELOLW\DQG6HUYLFH/LIH'HVLJQ3HUVRQDOFRPPXQLFDWLRQ >5RVWDP@5RVWDP6  'XUDELOLW\DQG6HUYLFH/LIH'HVLJQ3HUVRQDOFRPPXQLFDWLRQ
&2:,$6.JV/\QJE\'HQPDUN &2:,$6.JV/\QJE\'HQPDUN
>5RXVVHDX %HUQKHLP@5RXVVHDX* %HUQKHLP-  &U\VWDOOLVHG+\GUDWHG >5RXVVHDX %HUQKHLP@5RXVVHDX* %HUQKHLP-  &U\VWDOOLVHG+\GUDWHG
3RWDVVLXP)HUULWHSUHSDUHGLQWKH'U\:D\([WUDFWIURPDUWLFOH5R\DO6RFLHW\RI&KHPLVWU\/RQGRQ 3RWDVVLXP)HUULWHSUHSDUHGLQWKH'U\:D\([WUDFWIURPDUWLFOH5R\DO6RFLHW\RI&KHPLVWU\/RQGRQ
8.SS$YDLODEOHRQOLQHKWWSZZZUVFRUJDFFHVVHG$XJ 8.SS$YDLODEOHRQOLQHKWWSZZZUVFRUJDFFHVVHG$XJ
>5|ULJ'DOJDDUG 2WWRVHQ@5|ULJ'DOJDDUG, 2WWRVHQ/0  µ3UHVHUYDWLRQRI >5|ULJ'DOJDDUG 2WWRVHQ@5|ULJ'DOJDDUG, 2WWRVHQ/0  µ3UHVHUYDWLRQRI
PXUDOVRQVDOWORDGHGPDVRQU\YDXOWVE\HOHFWURPLJUDWLRQ¶SS±,Q3URFHHGLQJVRI7HQWK PXUDOVRQVDOWORDGHGPDVRQU\YDXOWVE\HOHFWURPLJUDWLRQ¶SS±,Q3URFHHGLQJVRI7HQWK
,QWHUQDWLRQDO&RQIHUHQFHRQ6WXGLHV5HSDLUVDQG0DLQWHQDQFHRI+HULWDJH$UFKLWHFWXUH 675(0$+  ,QWHUQDWLRQDO&RQIHUHQFHRQ6WXGLHV5HSDLUVDQG0DLQWHQDQFHRI+HULWDJH$UFKLWHFWXUH 675(0$+ 
3UDJXH&]HFK5HSXEOLF$VKXUVW8. 3UDJXH&]HFK5HSXEOLF$VKXUVW8.
>5XSSUHFKW@5XSSUHFKW/(  &RQGXFWLYH3RO\PHUVDQG3ODVWLFVLQ,QGXVWULDO >5XSSUHFKW@5XSSUHFKW/(  &RQGXFWLYH3RO\PHUVDQG3ODVWLFVLQ,QGXVWULDO
$SSOLFDWLRQV1RUZLFK1<86$3ODVWLFV'HVLJQ/LEUDU\VWHGLWLRQSS $SSOLFDWLRQV1RUZLFK1<86$3ODVWLFV'HVLJQ/LEUDU\VWHGLWLRQSS

;9, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;9, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 /LVWRI5HIHUHQFHV  /LVWRI5HIHUHQFHV

>5XVLQRZVNLHWDO@5XVLQRZVNL3(QRFKVVRQ2 7lOMVWHQ%  µ1XPHULFDODQDO\VLV >5XVLQRZVNLHWDO@5XVLQRZVNL3(QRFKVVRQ2 7lOMVWHQ%  µ1XPHULFDODQDO\VLV


RIWZRZD\FRQFUHWHVODEVZLWKRSHQLQJVVWUHQJWKHQHGZLWK&)53¶SS±,Q3URFHHGLQJVRIUG RIWZRZD\FRQFUHWHVODEVZLWKRSHQLQJVVWUHQJWKHQHGZLWK&)53¶SS±,Q3URFHHGLQJVRIUG
,QWHUQDWLRQDO&RQIHUHQFHRQ)53&RPSRVLWHVLQ&LYLO(QJLQHHULQJ &,&( 0LDPL)/86$ ,QWHUQDWLRQDO&RQIHUHQFHRQ)53&RPSRVLWHVLQ&LYLO(QJLQHHULQJ &,&( 0LDPL)/86$
>6$@6$  6RODUWURQ$QDO\WLFDO(OHFWURFKHPLFDO,QVWUXPHQWDWLRQ6RODUWURQ$QDO\WLFDO >6$@6$  6RODUWURQ$QDO\WLFDO(OHFWURFKHPLFDO,QVWUXPHQWDWLRQ6RODUWURQ$QDO\WLFDO
)DUQERURXJK8.:HEVLWHKWWSZZZVRODUWURQDQDO\WLFDOFRPDFFHVVHG$SU )DUQERURXJK8.:HEVLWHKWWSZZZVRODUWURQDQDO\WLFDOFRPDFFHVVHG$SU
>6DJRH&UHQWVLO *ODVVHU@6DJRH&UHQWVLO.. *ODVVHU)3  µ6WHHOLQFRQFUHWH >6DJRH&UHQWVLO *ODVVHU@6DJRH&UHQWVLO.. *ODVVHU)3  µ6WHHOLQFRQFUHWH
3DUW,$UHYLHZRIWKHHOHFWURFKHPLFDODQGWKHUPRG\QDPLFDVSHFWV¶0DJD]LQHRI&RQFUHWH5HVHDUFK 3DUW,$UHYLHZRIWKHHOHFWURFKHPLFDODQGWKHUPRG\QDPLFDVSHFWV¶0DJD]LQHRI&RQFUHWH5HVHDUFK
  SS±   SS±
>6DJRH&UHQWVLO *ODVVHU@6DJRH&UHQWVLO.. *ODVVHU)3  µ³*UHHQUXVW´LURQ >6DJRH&UHQWVLO *ODVVHU@6DJRH&UHQWVLO.. *ODVVHU)3  µ³*UHHQUXVW´LURQ
VROXELOLW\DQGWKHUROHRIFKORULGHLQWKHFRUURVLRQRIVWHHODWKLJKS+¶&HPHQWDQG&RQFUHWH5HVHDUFK VROXELOLW\DQGWKHUROHRIFKORULGHLQWKHFRUURVLRQRIVWHHODWKLJKS+¶&HPHQWDQG&RQFUHWH5HVHDUFK
  SS±   SS±
>6DJpV@6DJpV$$  µ&ULWLFDO,VVXHVLQ(OHFWURFKHPLFDO&RUURVLRQ0HDVXUHPHQW >6DJpV@6DJpV$$  µ&ULWLFDO,VVXHVLQ(OHFWURFKHPLFDO&RUURVLRQ0HDVXUHPHQW
7HFKQLTXHVIRU6WHHOLQ&RQFUHWH¶SS3DSHUSS,Q&RUURVLRQ7KH1$&($QQXDO 7HFKQLTXHVIRU6WHHOLQ&RQFUHWH¶SS3DSHUSS,Q&RUURVLRQ7KH1$&($QQXDO
&RQIHUHQFHDQG&RUURVLRQ6KRZ+RXVWRQ7; &RQIHUHQFHDQG&RUURVLRQ6KRZ+RXVWRQ7;
>6DQGEHUJ@6DQGEHUJ3  &KORULGHLQLWLDWHGUHLQIRUFHPHQWFRUURVLRQLQPDULQH >6DQGEHUJ@6DQGEHUJ3  &KORULGHLQLWLDWHGUHLQIRUFHPHQWFRUURVLRQLQPDULQH
FRQFUHWH3K'WKHVLV UHSRUW79%0 'LYLVLRQRI%XLOGLQJ0DWHULDOV/XQG,QVWLWXWHRI FRQFUHWH3K'WKHVLV UHSRUW79%0 'LYLVLRQRI%XLOGLQJ0DWHULDOV/XQG,QVWLWXWHRI
7HFKQRORJ\/XQG6ZHGHQSS 7HFKQRORJ\/XQG6ZHGHQSS
>6DUHPL 0DKDOODWL@6DUHPL0 0DKDOODWL(  µ$VWXG\RIFKORULGHLQGXFHG >6DUHPL 0DKDOODWL@6DUHPL0 0DKDOODWL(  µ$VWXG\RIFKORULGHLQGXFHG
GHSDVVLYDWLRQRIPLOGVWHHOLQVLPXODWHGFRQFUHWHSRUHVROXWLRQ¶&HPHQWDQG&RQFUHWH5HVHDUFK GHSDVVLYDWLRQRIPLOGVWHHOLQVLPXODWHGFRQFUHWHSRUHVROXWLRQ¶&HPHQWDQG&RQFUHWH5HVHDUFK
  SS±   SS±
>6DUMD 9HVLNDUL@6DUMD$ 9HVLNDUL( (GV   'XUDELOLW\'HVLJQRI&RQFUHWH >6DUMD 9HVLNDUL@6DUMD$ 9HVLNDUL( (GV   'XUDELOLW\'HVLJQRI&RQFUHWH
6WUXFWXUH1XPEHULQ5LOHP5HSRUW/RQGRQ8.( )16SRQ &KDSPDQ +DOO VWHGLWLRQ 6WUXFWXUH1XPEHULQ5LOHP5HSRUW/RQGRQ8.( )16SRQ &KDSPDQ +DOO VWHGLWLRQ
SS SS
>6FKLH‰O@6FKLH‰O3  (LQIOX‰YRQ5LVVHQDXIGLH'DXHUKDIWLJNHLWYRQ6WDKOEHWRQXQG >6FKLH‰O@6FKLH‰O3  (LQIOX‰YRQ5LVVHQDXIGLH'DXHUKDIWLJNHLWYRQ6WDKOEHWRQXQG
6SDQQEHWRQEDXWHLOHQ'$I6WE+HIW'HXWVFKHU$XVVFKXVVIU6WDKOEHWRQ%HUOLQ*HUPDQ\SS 6SDQQEHWRQEDXWHLOHQ'$I6WE+HIW'HXWVFKHU$XVVFKXVVIU6WDKOEHWRQ%HUOLQ*HUPDQ\SS
*HUPDQODQJXDJH *HUPDQODQJXDJH
>6FKLH‰O@6FKLH‰O3  µ&UDFNLQJRIFRQFUHWHDQGGXUDELOLW\RIFRQFUHWHVWUXFWXUHV¶SS >6FKLH‰O@6FKLH‰O3  µ&UDFNLQJRIFRQFUHWHDQGGXUDELOLW\RIFRQFUHWHVWUXFWXUHV¶SS
±,Q3URFHHGLQJVRI$)5(0&&(6W5pP\OHV&KHYUHXVH)UDQFH ±,Q3URFHHGLQJVRI$)5(0&&(6W5pP\OHV&KHYUHXVH)UDQFH
>6FKLH‰OHWDO@6FKLH‰O3$QGUDGH&%DNNHU53DJH&/ 7UHDGDZD\.   >6FKLH‰OHWDO@6FKLH‰O3$QGUDGH&%DNNHU53DJH&/ 7UHDGDZD\.  
&RUURVLRQRI6WHHOLQ&RQFUHWH5,/(07HFKQLFDO&RPPLWWHH&6&1HZ<RUN1<86$ &RUURVLRQRI6WHHOLQ&RQFUHWH5,/(07HFKQLFDO&RPPLWWHH&6&1HZ<RUN1<86$
&KDSPDQ +DOOVWHGLWLRQSS &KDSPDQ +DOOVWHGLWLRQSS
>6FKLH‰OHWDO@6FKLH‰O3%UDXHU1 %UHLW:  7UDQVSRUW$XVKHLOXQJVXQG >6FKLH‰OHWDO@6FKLH‰O3%UDXHU1 %UHLW:  7UDQVSRUW$XVKHLOXQJVXQG
.RUURVLRQVPHFKDQLVPHQEHL)OVVLJNHLWHQLQ5LVVHQ7HFKQLFDOUHSRUW)5:7+$DFKHQ .RUURVLRQVPHFKDQLVPHQEHL)OVVLJNHLWHQLQ5LVVHQ7HFKQLFDOUHSRUW)5:7+$DFKHQ
8QLYHUVLW\$DFKHQ*HUPDQ\SS*HUPDQODQJXDJH 8QLYHUVLW\$DFKHQ*HUPDQ\SS*HUPDQODQJXDJH
>6FKLH‰O %UHLW@6FKLH‰O3 %UHLW:  µ/RFDOUHSDLUPHDVXUHVDWFRQFUHWHVWUXFWXUHV >6FKLH‰O %UHLW@6FKLH‰O3 %UHLW:  µ/RFDOUHSDLUPHDVXUHVDWFRQFUHWHVWUXFWXUHV
GDPDJHGE\UHLQIRUFHPHQWFRUURVLRQ±$VSHFWVRIGXUDELOLW\¶6SHFLDO3XEOLFDWLRQVRIWKH5R\DO6RFLHW\ GDPDJHGE\UHLQIRUFHPHQWFRUURVLRQ±$VSHFWVRIGXUDELOLW\¶6SHFLDO3XEOLFDWLRQVRIWKH5R\DO6RFLHW\
RI&KHPLVWU\SS± RI&KHPLVWU\SS±
>6FKLH‰O 5DXSDFK@6FKLH‰O3 5DXSDFK0  µ,QIOXHQFHRIFRQFUHWHFRPSRVLWLRQ >6FKLH‰O 5DXSDFK@6FKLH‰O3 5DXSDFK0  µ,QIOXHQFHRIFRQFUHWHFRPSRVLWLRQ
DQGPLFURFOLPDWHRQWKHFULWLFDOFKORULGHFRQWHQWLQFRQFUHWH¶SS±,Q3DJH&/7UHDGDZD\. DQGPLFURFOLPDWHRQWKHFULWLFDOFKORULGHFRQWHQWLQFRQFUHWH¶SS±,Q3DJH&/7UHDGDZD\.
:- %DPIRUWK3% (GV &RUURVLRQRIUHLQIRUFHPHQWLQFRQFUHWH/RQGRQ8.(OVHYLHU :- %DPIRUWK3% (GV &RUURVLRQRIUHLQIRUFHPHQWLQFRQFUHWH/RQGRQ8.(OVHYLHU
$SSOLHG6FLHQFH $SSOLHG6FLHQFH
>6FKLH‰O 5DXSDFK@6FKLH‰O3 5DXSDFK0  µ,QIOXHQFHRI7HPSHUDWXUHRQWKH >6FKLH‰O 5DXSDFK@6FKLH‰O3 5DXSDFK0  µ,QIOXHQFHRI7HPSHUDWXUHRQWKH
&RUURVLRQ5DWHRI6WHHOLQ&RQFUHWH&RQWDLQLQJ&KORULGHV¶SS±,Q$OVKDPVL$0 (G  &RUURVLRQ5DWHRI6WHHOLQ&RQFUHWH&RQWDLQLQJ&KORULGHV¶SS±,Q$OVKDPVL$0 (G 
5HLQIRUFHG&RQFUHWH0DWHULDOVLQ+RW&OLPDWHV3RUWODQG2586$7D\ORU )UDQFLV 5HLQIRUFHG&RQFUHWH0DWHULDOVLQ+RW&OLPDWHV3RUWODQG2586$7D\ORU )UDQFLV
>6FKLH‰O 5DXSDFK@6FKLH‰O3 5DXSDFK0  µ/DERUDWRU\6WXGLHVDQG&DOFXODWLRQV >6FKLH‰O 5DXSDFK@6FKLH‰O3 5DXSDFK0  µ/DERUDWRU\6WXGLHVDQG&DOFXODWLRQV
RQWKH,QIOXHQFHRI&UDFN:LGWKRQ&KORULGH,QGXFHG&RUURVLRQRI6WHHOLQ&RQFUHWH¶$&,0DWHULDOV RQWKH,QIOXHQFHRI&UDFN:LGWKRQ&KORULGH,QGXFHG&RUURVLRQRI6WHHOLQ&RQFUHWH¶$&,0DWHULDOV
-RXUQDO  SS± -RXUQDO  SS±
>6FKLH‰OHWDO@6FKLH‰O36¡UHQVHQ%$QGUDGH&3ROGHU5,VHFNH% 3DJH& >6FKLH‰OHWDO@6FKLH‰O36¡UHQVHQ%$QGUDGH&3ROGHU5,VHFNH% 3DJH&
 µ'UDIWUHFRPPHQGDWLRQIRUUHSDLUVWUDWHJLHVIRUFRQFUHWHVWUXFWXUHVGDPDJHGE\UHLQIRUFHPHQW  µ'UDIWUHFRPPHQGDWLRQIRUUHSDLUVWUDWHJLHVIRUFRQFUHWHVWUXFWXUHVGDPDJHGE\UHLQIRUFHPHQW
FRUURVLRQ¶0DWHULDOVDQG6WUXFWXUHV  SS FRUURVLRQ¶0DWHULDOVDQG6WUXFWXUHV  SS

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;9,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;9,,


/LVWRI5HIHUHQFHV /LVWRI5HIHUHQFHV

>6FKRO]HWDO@6FKRO]:+LHVH: .QREODXFK+  %DXVWRIINHQQWQLV'VVHOGRUI >6FKRO]HWDO@6FKRO]:+LHVH: .QREODXFK+  %DXVWRIINHQQWQLV'VVHOGRUI


*HUPDQ\:HUQHUSS*HUPDQODQJXDJH *HUPDQ\:HUQHUSS*HUPDQODQJXDJH
>6FKURHGHU@6FKURHGHU'DQLHO9$:  $Q,QWURGXFWLRQWR7KHUPDO3K\VLFV >6FKURHGHU@6FKURHGHU'DQLHO9$:  $Q,QWURGXFWLRQWR7KHUPDO3K\VLFV
/RQGRQ8.$GGLVRQ:HVOH\ 3HDUVRQ VWHGLWLRQSS /RQGRQ8.$GGLVRQ:HVOH\ 3HDUVRQ VWHGLWLRQSS
>6FKXWWHU@6FKXWWHU*G  µ4XDQWLILFDWLRQRIWKHLQIOXHQFHRIFUDFNVLQFRQFUHWH >6FKXWWHU@6FKXWWHU*G  µ4XDQWLILFDWLRQRIWKHLQIOXHQFHRIFUDFNVLQFRQFUHWH
VWUXFWXUHVRQFDUERQDWLRQDQGFKORULGHSHQHWUDWLRQ¶0DJD]LQHRI&RQFUHWH5HVHDUFK  SS± VWUXFWXUHVRQFDUERQDWLRQDQGFKORULGHSHQHWUDWLRQ¶0DJD]LQHRI&RQFUHWH5HVHDUFK  SS±
 
>6FULEQHU@6FULEQHU  =3ORWIRU:LQGRZV9HUVLRQE(OHFWURFKHPLFDOLPSHGDQFH >6FULEQHU@6FULEQHU  =3ORWIRU:LQGRZV9HUVLRQE(OHFWURFKHPLFDOLPSHGDQFH
VSHFWURVFRS\VRIWZDUH6FULEQHU$VVRFLDWHV6RXWKHUQ3LQHV1&86$ VSHFWURVFRS\VRIWZDUH6FULEQHU$VVRFLDWHV6RXWKHUQ3LQHV1&86$
>6KDUSHWDO@6KDUS65&OHPHxD**9LUPDQL<36WRQHU*( .HOO\5* >6KDUSHWDO@6KDUS65&OHPHxD**9LUPDQL<36WRQHU*( .HOO\5*
 (OHFWURFKHPLFDO&KORULGH([WUDFWLRQ,QIOXHQFHRI&RQFUHWH6XUIDFHRQ7UHDWPHQW5HSRUW  (OHFWURFKHPLFDO&KORULGH([WUDFWLRQ,QIOXHQFHRI&RQFUHWH6XUIDFHRQ7UHDWPHQW5HSRUW
)+:$5')HGHUDO+LJKZD\$GPLQLVWUDWLRQ:DVKLQJWRQ'&86$SS )+:$5')HGHUDO+LJKZD\$GPLQLVWUDWLRQ:DVKLQJWRQ'&86$SS
>6KDUS 9LUPDQL@6KDUS65 9LUPDQL<3  )DFWRUV7KDW,QIOXHQFHWKH(IILFLHQF\ >6KDUS 9LUPDQL@6KDUS65 9LUPDQL<3  )DFWRUV7KDW,QIOXHQFHWKH(IILFLHQF\
RI(OHFWURFKHPLFDO&KORULGH([WUDFWLRQGXULQJ&RUURVLRQ0LWLJDWLRQLQ5HLQIRUFHG&RQFUHWH RI(OHFWURFKHPLFDO&KORULGH([WUDFWLRQGXULQJ&RUURVLRQ0LWLJDWLRQLQ5HLQIRUFHG&RQFUHWH
6WUXFWXUHV5HSRUW975&59LUJLQLD7UDQVSRUWDWLRQ5HVHDUFK&RXQFLO&KDUORWWHVYLOOH9$ 6WUXFWXUHV5HSRUW975&59LUJLQLD7UDQVSRUWDWLRQ5HVHDUFK&RXQFLO&KDUORWWHVYLOOH9$
86$SS 86$SS
>6KRFN +HOJHVRQ@6KRFN( +HOJHVRQ+&  µ&DOFXODWLRQRIWKHWKHUPRG\QDPLF >6KRFN +HOJHVRQ@6KRFN( +HOJHVRQ+&  µ&DOFXODWLRQRIWKHWKHUPRG\QDPLF
DQGWUDQVSRUWSURSHUWLHVRIDTXHRXVVSHFLHVDWKLJKSUHVVXUHVDQGWHPSHUDWXUHV&RUUHODWLRQDOJRULWKPV DQGWUDQVSRUWSURSHUWLHVRIDTXHRXVVSHFLHVDWKLJKSUHVVXUHVDQGWHPSHUDWXUHV&RUUHODWLRQDOJRULWKPV
IRULRQLFVSHFLHVDQGHTXDWLRQRIVWDWHSUHGLFWLRQVWRNEDQGGHJUHH&¶*HRFKLPLFDHW IRULRQLFVSHFLHVDQGHTXDWLRQRIVWDWHSUHGLFWLRQVWRNEDQGGHJUHH&¶*HRFKLPLFDHW
&RVPRFKLPLFD$FWDSS± &RVPRFKLPLFD$FWDSS±
>6KRFN .RUH]N\@6KRFN( .RUH]N\&0  µ0HWDORUJDQLFFRPSOH[HVLQ >6KRFN .RUH]N\@6KRFN( .RUH]N\&0  µ0HWDORUJDQLFFRPSOH[HVLQ
JHRFKHPLFDOSURFHVVHV&DOFXODWLRQRIVWDQGDUGSDUWLDOPRODOWKHUPRG\QDPLFSURSHUWLHVRIDTXHRXV JHRFKHPLFDOSURFHVVHV&DOFXODWLRQRIVWDQGDUGSDUWLDOPRODOWKHUPRG\QDPLFSURSHUWLHVRIDTXHRXV
DFHWDWHFRPSOH[HVDWKLJKSUHVVXUHVDQGWHPSHUDWXUHV¶*HRFKLPLFDHW&RVPRFKLPLFD$FWD DFHWDWHFRPSOH[HVDWKLJKSUHVVXUHVDQGWHPSHUDWXUHV¶*HRFKLPLFDHW&RVPRFKLPLFD$FWD
SS± SS±
>6KRFNHWDO@6KRFN(6DVVDQL':LOOLV0 6YHUMHQVN\'  µ,QRUJDQLFVSHFLHVLQ >6KRFNHWDO@6KRFN(6DVVDQL':LOOLV0 6YHUMHQVN\'  µ,QRUJDQLFVSHFLHVLQ
JHRORJLFIOXLGV&RUUHODWLRQVDPRQJVWDQGDUGPRODOSURSHUWLHVRIDTXHRXVLRQVDQGK\GUR[LGH JHRORJLFIOXLGV&RUUHODWLRQVDPRQJVWDQGDUGPRODOSURSHUWLHVRIDTXHRXVLRQVDQGK\GUR[LGH
FRPSOH[HV¶*HRFKLPLFDHW&RVPRFKLPLFD$FWDSS± FRPSOH[HV¶*HRFKLPLFDHW&RVPRFKLPLFD$FWDSS±
>6RILQ -DQVHQ@6RILQ0 -DQVHQ0  µ6\QWKHVLVFU\VWDOVWUXFWXUHDQGPDJQHWLF >6RILQ -DQVHQ@6RILQ0 -DQVHQ0  µ6\QWKHVLVFU\VWDOVWUXFWXUHDQGPDJQHWLF
SURSHUWLHVRI‰1D)H2¶6ROLG6WDWH6FLHQFHV  SS± SURSHUWLHVRI‰1D)H2¶6ROLG6WDWH6FLHQFHV  SS±
>665@665  6WDLQOHVV6WHHO5HEDU,QWHUQDWLRQDO%XOOHWLQ7XOOPLQ&RQVXOWLQJ.LQJVWRQ >665@665  6WDLQOHVV6WHHO5HEDU,QWHUQDWLRQDO%XOOHWLQ7XOOPLQ&RQVXOWLQJ.LQJVWRQ
&DQDGD:HEVLWHKWWSZZZVWDLQOHVVUHEDURUJDFFHVVHG-XO &DQDGD:HEVLWHKWWSZZZVWDLQOHVVUHEDURUJDFFHVVHG-XO
>6WHUQ *HDU\@6WHUQ0 *HDU\$/  µ(OHFWURFKHPLFDOSRODUL]DWLRQ,$ >6WHUQ *HDU\@6WHUQ0 *HDU\$/  µ(OHFWURFKHPLFDOSRODUL]DWLRQ,$
WKHRUHWLFDODQDO\VLVRIWKHVKDSHRISRODUL]DWLRQFXUYHV¶-RXUQDORIWKH(OHFWURFKHPLFDO6RFLHW\   WKHRUHWLFDODQDO\VLVRIWKHVKDSHRISRODUL]DWLRQFXUYHV¶-RXUQDORIWKH(OHFWURFKHPLFDO6RFLHW\  
SS± SS±
>6WRUHE OW@6WRUHE OW  7KH*UHDW%HOW/LQN(DVW7XQQHO)RFXVRQWKHERUHGWXQQHOIRU >6WRUHE OW@6WRUHE OW  7KH*UHDW%HOW/LQN(DVW7XQQHO)RFXVRQWKHERUHGWXQQHOIRU
WUDLQV7KH6WRUHEDHOW3XEOLFDWLRQV&RSHQKDJHQ'HQPDUN6WRUHE OW$6VWHGLWLRQSS WUDLQV7KH6WRUHEDHOW3XEOLFDWLRQV&RSHQKDJHQ'HQPDUN6WRUHE OW$6VWHGLWLRQSS
>6WUDVFKLOO@6WUDVFKLOO0  1HX]HLWOLFKHV%HL]HQYRQ0HWDOOHQ6FKULIWHQUHLKH >6WUDVFKLOO@6WUDVFKLOO0  1HX]HLWOLFKHV%HL]HQYRQ0HWDOOHQ6FKULIWHQUHLKH
*DOYDQRWHFKQLN6DXOJDX*HUPDQ\/HX]HSS*HUPDQODQJXDJH *DOYDQRWHFKQLN6DXOJDX*HUPDQ\/HX]HSS*HUPDQODQJXDJH
>6WUHHE +RIIPDQQ@6WUHHE5 +RIIPDQQ5  0HWDOO(QWIHWWXQJXQG5HLQLJXQJ >6WUHHE +RIIPDQQ@6WUHHE5 +RIIPDQQ5  0HWDOO(QWIHWWXQJXQG5HLQLJXQJ
6FKULIWHQUHLKH*DOYDQRWHFKQLN6DXOJDX*HUPDQ\(XJHQ*/HX]HSS*HUPDQODQJXDJH 6FKULIWHQUHLKH*DOYDQRWHFKQLN6DXOJDX*HUPDQ\(XJHQ*/HX]HSS*HUPDQODQJXDJH
>‘VWYLN@‘VWYLN-0  7KHUPDO$VSHFWVRI&RUURVLRQRI6WHHOLQ&RQFUHWH3K'WKHVLV >‘VWYLN@‘VWYLN-0  7KHUPDO$VSHFWVRI&RUURVLRQRI6WHHOLQ&RQFUHWH3K'WKHVLV
1RUZHJLDQ8QLYHUVLW\RI6FLHQFHDQG7HFKQRORJ\ 1718 7URQGKHLP1RUZD\SS 1RUZHJLDQ8QLYHUVLW\RI6FLHQFHDQG7HFKQRORJ\ 1718 7URQGKHLP1RUZD\SS
>7D\ORU@7D\ORU+):  &HPHQW&KHPLVWU\/RQGRQ8.7KRPDV7HOIRUGQG >7D\ORU@7D\ORU+):  &HPHQW&KHPLVWU\/RQGRQ8.7KRPDV7HOIRUGQG
HGLWLRQSS HGLWLRQSS
>7+'$@7+'$  7KHUPRG\QDPLF3URSHUWLHV2I,QRUJDQLF6XEVWDQFHV,QRUJDQLF >7+'$@7+'$  7KHUPRG\QDPLF3URSHUWLHV2I,QRUJDQLF6XEVWDQFHV,QRUJDQLF
&KHPLVWU\7+(502'$7$*UHQREOH)UDQFH:HEVLWHKWWSWKHUPRGDWDRQOLQHIUDFFHVVHG &KHPLVWU\7+(502'$7$*UHQREOH)UDQFH:HEVLWHKWWSWKHUPRGDWDRQOLQHIUDFFHVVHG
6HS 6HS
>7KRPSVRQHWDO@7KRPSVRQ1*<XQRYLFK0 /DQNDUG'5  3URFHGXUHVIRU >7KRPSVRQHWDO@7KRPSVRQ1*<XQRYLFK0 /DQNDUG'5  3URFHGXUHVIRU
(YDOXDWLQJ&RUURVLRQ,QKLELWLQJ$GPL[WXUHVIRU6WUXFWXUDO&RQFUHWH5HSRUW1&+53:HE'RFXPHQW (YDOXDWLQJ&RUURVLRQ,QKLELWLQJ$GPL[WXUHVIRU6WUXFWXUDO&RQFUHWH5HSRUW1&+53:HE'RFXPHQW
 3URMHFW' 1DWLRQDO&RRSHUDWLYH+LJKZD\5HVHDUFK3URJUDP7UDQVSRUWDWLRQ5HVHDUFK  3URMHFW' 1DWLRQDO&RRSHUDWLYH+LJKZD\5HVHDUFK3URJUDP7UDQVSRUWDWLRQ5HVHDUFK
%RDUG1DWLRQDO5HVHDUFK&RXQFLO:DVKLQJWRQ'&86$SS %RDUG1DWLRQDO5HVHDUFK&RXQFLO:DVKLQJWRQ'&86$SS

;9,,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;9,,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 /LVWRI5HIHUHQFHV  /LVWRI5HIHUHQFHV

>7lOMVWHQ &DUROLQ@7lOMVWHQ% &DUROLQ$  µ1HDU6XUIDFH0RXQWHG5HLQIRUFHPHQW >7lOMVWHQ &DUROLQ@7lOMVWHQ% &DUROLQ$  µ1HDU6XUIDFH0RXQWHG5HLQIRUFHPHQW
1605 WRVWUHQJWKHQFRQFUHWHVWUXFWXUHV¶SS±,Q,QWHUQDWLRQDO&RQIHUHQFHRQ6XVWDLQDEOH 1605 WRVWUHQJWKHQFRQFUHWHVWUXFWXUHV¶SS±,Q,QWHUQDWLRQDO&RQIHUHQFHRQ6XVWDLQDEOH
%ULGJHV:URFODZ3RODQG %ULGJHV:URFODZ3RODQG
>7RPOLQVRQ 0DUVK@7RPOLQVRQ: 0DUVK3  µ&RUURVLRQRILURQVWHHO]LQF >7RPOLQVRQ 0DUVK@7RPOLQVRQ: 0DUVK3  µ&RUURVLRQRILURQVWHHO]LQF
QLFNHODQGHOHFWUROHVVQLFNHOLQFRQFUHWH¶-RXUQDORI0DWHULDOV6FLHQFH/HWWHUV  SS± QLFNHODQGHOHFWUROHVVQLFNHOLQFRQFUHWH¶-RXUQDORI0DWHULDOV6FLHQFH/HWWHUV  SS±
>7UHWKHZH\ &KDPEHUODLQ@7UHWKHZH\.5 &KDPEHUODLQ-  &RUURVLRQ)RU >7UHWKHZH\ &KDPEHUODLQ@7UHWKHZH\.5 &KDPEHUODLQ-  &RUURVLRQ)RU
6WXGHQWVRI6FLHQFHDQG(QJLQHHULQJ8SSHU6DGGOH5LYHU1-86$3UHQWLFH+DOOQGHGLWLRQSS 6WXGHQWVRI6FLHQFHDQG(QJLQHHULQJ8SSHU6DGGOH5LYHU1-86$3UHQWLFH+DOOQGHGLWLRQSS
>7ULSOHUHWDO@7ULSOHU$%:KLWH(/+D\QLH)+ %R\G:.  0HWKRGVRI >7ULSOHUHWDO@7ULSOHU$%:KLWH(/+D\QLH)+ %R\G:.  0HWKRGVRI
5HGXFLQJ&RUURVLRQRI5HLQIRUFLQJ6WHHO5HSRUW+LJKZD\5HVHDUFK%RDUG:DVKLQJWRQ'&86$ 5HGXFLQJ&RUURVLRQRI5HLQIRUFLQJ6WHHO5HSRUW+LJKZD\5HVHDUFK%RDUG:DVKLQJWRQ'&86$
SS SS
>7UpSDQLHUHWDO@7UpSDQLHU60+RSH%% +DQVVRQ&0  µ&RUURVLRQ >7UpSDQLHUHWDO@7UpSDQLHU60+RSH%% +DQVVRQ&0  µ&RUURVLRQ
LQKLELWRUVLQFRQFUHWH3DUW,,,(IIHFWRQWLPHWRFKORULGHLQGXFHGFRUURVLRQLQLWLDWLRQDQGVXEVHTXHQW LQKLELWRUVLQFRQFUHWH3DUW,,,(IIHFWRQWLPHWRFKORULGHLQGXFHGFRUURVLRQLQLWLDWLRQDQGVXEVHTXHQW
FRUURVLRQUDWHVRIVWHHOLQPRUWDU¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS± FRUURVLRQUDWHVRIVWHHOLQPRUWDU¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS±
>7XXWWL@7XXWWL.  &RUURVLRQRIVWHHOLQFRQFUHWH5HSRUW6ZHGLVK&HPHQWDQG >7XXWWL@7XXWWL.  &RUURVLRQRIVWHHOLQFRQFUHWH5HSRUW6ZHGLVK&HPHQWDQG
&RQFUHWH5HVHDUFK,QVWLWXWH6WRFNKROP6ZHGHQSS &RQFUHWH5HVHDUFK,QVWLWXWH6WRFNKROP6ZHGHQSS
>9DO 6WHZDUW@9DO'9 6WHZDUW0*  µ/LIHF\FOHFRVWDQDO\VLVRIUHLQIRUFHG >9DO 6WHZDUW@9DO'9 6WHZDUW0*  µ/LIHF\FOHFRVWDQDO\VLVRIUHLQIRUFHG
FRQFUHWHVWUXFWXUHVLQPDULQHHQYLURQPHQWV¶6WUXFWXUDO6DIHW\  SS± FRQFUHWHVWUXFWXUHVLQPDULQHHQYLURQPHQWV¶6WUXFWXUDO6DIHW\  SS±
>9D\VEXUG (PPRQV@9D\VEXUG$ (PPRQV3  µ&RUURVLRQLQKLELWRUVDQGRWKHU >9D\VEXUG (PPRQV@9D\VEXUG$ (PPRQV3  µ&RUURVLRQLQKLELWRUVDQGRWKHU
SURWHFWLYHV\VWHPVLQFRQFUHWHUHSDLUFRQFHSWVRUPLVFRQFHSWV¶&HPHQWDQG&RQFUHWH&RPSRVLWHV SURWHFWLYHV\VWHPVLQFRQFUHWHUHSDLUFRQFHSWVRUPLVFRQFHSWV¶&HPHQWDQG&RQFUHWH&RPSRVLWHV
  SS±   SS±
>9'(K@9'(K  6WDKO(LVHQ/LVWH5HJLVWHU(XURSlLVFKHU6WlKOH'HVVDX*HUPDQ\ >9'(K@9'(K  6WDKO(LVHQ/LVWH5HJLVWHU(XURSlLVFKHU6WlKOH'HVVDX*HUPDQ\
9HUHLQ'HXWVFKHU(LVHQKWWHQOHXWH 9'(K WKHGLWLRQSS*HUPDQODQJXDJH 9HUHLQ'HXWVFKHU(LVHQKWWHQOHXWH 9'(K WKHGLWLRQSS*HUPDQODQJXDJH
>9RONZHLQ@9RONZHLQ$  8QWHUVXFKXQJHQEHUGDV(LQGULQJHQYRQ:DVVHUXQG >9RONZHLQ@9RONZHLQ$  8QWHUVXFKXQJHQEHUGDV(LQGULQJHQYRQ:DVVHUXQG
&KORULGLQ%HWRQ3K'WKHVLV7HFKQLFDO8QLYHUVLW\RI0XQLFK0XQLFK*HUPDQ\SS*HUPDQ &KORULGLQ%HWRQ3K'WKHVLV7HFKQLFDO8QLYHUVLW\RI0XQLFK0XQLFK*HUPDQ\SS*HUPDQ
ODQJXDJH ODQJXDJH
>:DJPDQHWDO@:DJPDQ''(YDQV:+3DUNHU9%6FKXPP5+ +DORZ, >:DJPDQHWDO@:DJPDQ''(YDQV:+3DUNHU9%6FKXPP5+ +DORZ,
 µ7KH1%67DEOHVRI&KHPLFDO7KHUPRG\QDPLF3URSHUWLHV6HOHFWHG9DOXHVIRU,QRUJDQLFDQG  µ7KH1%67DEOHVRI&KHPLFDO7KHUPRG\QDPLF3URSHUWLHV6HOHFWHG9DOXHVIRU,QRUJDQLFDQG
&DQG&2UJDQLF6XEVWDQFHVLQ6,8QLWV¶-RXUQDORI3K\VLFDODQG&KHPLFDO5HIHUHQFH'DWD &DQG&2UJDQLF6XEVWDQFHVLQ6,8QLWV¶-RXUQDORI3K\VLFDODQG&KHPLFDO5HIHUHQFH'DWD
SS6XSSOHPHQWQRWRYROXPH SS6XSSOHPHQWQRWRYROXPH
>:DJQHU 7UDXG@:DJQHU& 7UDXG:  µhEHUGLH'HXWXQJYRQ >:DJQHU 7UDXG@:DJQHU& 7UDXG:  µhEHUGLH'HXWXQJYRQ
.RUURVLRQVYRUJlQJHQGXUFKhEHUODJHUXQJYRQ(OHNWURFKHPLVFKHQ7HLOYRUJlQJHQXQGEHUGLH .RUURVLRQVYRUJlQJHQGXUFKhEHUODJHUXQJYRQ(OHNWURFKHPLVFKHQ7HLOYRUJlQJHQXQGEHUGLH
3RWHQWLDOOELOGXQJDQ0LVFKHOHNWURGHQ¶=HLWVFKULIWIU(OHNWURFKHPLHXQGDQJHZDQGWHSK\VLNDOLVFKH 3RWHQWLDOOELOGXQJDQ0LVFKHOHNWURGHQ¶=HLWVFKULIWIU(OHNWURFKHPLHXQGDQJHZDQGWHSK\VLNDOLVFKH
&KHPLH  SS±*HUPDQODQJXDJH &KHPLH  SS±*HUPDQODQJXDJH
>:DONHU 7DUQ@:DONHU3 7DUQ:+  &5&+DQGERRNRI0HWDO(WFKDQWV%RFD >:DONHU 7DUQ@:DONHU3 7DUQ:+  &5&+DQGERRNRI0HWDO(WFKDQWV%RFD
5DWRQ)/86$&5&VWHGLWLRQSS 5DWRQ)/86$&5&VWHGLWLRQSS
>:DQJHWDO@:DQJ.-DQVHQ'6KDK6 .DUU$  µ3HUPHDELOLW\6WXG\RI >:DQJHWDO@:DQJ.-DQVHQ'6KDK6 .DUU$  µ3HUPHDELOLW\6WXG\RI
&UDFNHG&RQFUHWH¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS± &UDFNHG&RQFUHWH¶&HPHQWDQG&RQFUHWH5HVHDUFK  SS±
>:HE(OH@:HE(OH  :HE(OHPHQWV3HULRGLF7DEOH8QLYHUVLW\RI6KHIILHOG6KHIILHOG >:HE(OH@:HE(OH  :HE(OHPHQWV3HULRGLF7DEOH8QLYHUVLW\RI6KHIILHOG6KHIILHOG
8.:HEVLWHKWWSZZZZHEHOHPHQWVFRPDFFHVVHG$XJ 8.:HEVLWHKWWSZZZZHEHOHPHQWVFRPDFFHVVHG$XJ
>:HE0LQ@:HE0LQ  0LQHUDORJ\'DWDEDVH%DUWKHOP\'DYLG6SULQJ7;86$ >:HE0LQ@:HE0LQ  0LQHUDORJ\'DWDEDVH%DUWKHOP\'DYLG6SULQJ7;86$
:HEVLWHKWWSZZZZHEPLQHUDOFRPDFFHVVHG$XJ :HEVLWHKWWSZZZZHEPLQHUDOFRPDFFHVVHG$XJ
>:HLGPDQQ@:HLGPDQQ(  0HWDOORJUDSKLF3UHSDUDWLRQRI=LQF&RDWLQJV$SSOLFDWLRQ >:HLGPDQQ@:HLGPDQQ(  0HWDOORJUDSKLF3UHSDUDWLRQRI=LQF&RDWLQJV$SSOLFDWLRQ
QRWHV6WUXHUV$6%DOOHUXS'HQPDUNSS QRWHV6WUXHUV$6%DOOHUXS'HQPDUNSS
>:HLGPDQQ *XHVQLHU@:HLGPDQQ( *XHVQLHU$  0HWDOORJUDSKLF3UHSDUDWLRQRI >:HLGPDQQ *XHVQLHU@:HLGPDQQ( *XHVQLHU$  0HWDOORJUDSKLF3UHSDUDWLRQRI
&DVW,URQ$SSOLFDWLRQQRWHV6WUXHUV$6%DOOHUXS'HQPDUNSS &DVW,URQ$SSOLFDWLRQQRWHV6WUXHUV$6%DOOHUXS'HQPDUNSS
>:HLGPDQQHWDO@:HLGPDQQ(*XHVQLHU$ 7D\ORU%  0HWDOORJUDSKLF >:HLGPDQQHWDO@:HLGPDQQ(*XHVQLHU$ 7D\ORU%  0HWDOORJUDSKLF
3UHSDUDWLRQRI6WDLQOHVV6WHHO$SSOLFDWLRQQRWHV6WUXHUV$6%DOOHUXS'HQPDUNSS 3UHSDUDWLRQRI6WDLQOHVV6WHHO$SSOLFDWLRQQRWHV6WUXHUV$6%DOOHUXS'HQPDUNSS
>:KHDW +DUGLQJ@:KHDW+ +DUGLQJ.  µ*DOYDQLFFRUURVLRQLQUHSDLUHG >:KHDW +DUGLQJ@:KHDW+ +DUGLQJ.  µ*DOYDQLFFRUURVLRQLQUHSDLUHG
UHLQIRUFHGFRQFUHWHVODEV$QXSGDWH¶0DWHULDOV3HUIRUPDQFH  SS± UHLQIRUFHGFRQFUHWHVODEV$QXSGDWH¶0DWHULDOV3HUIRUPDQFH  SS±

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;,; 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;,;


/LVWRI5HIHUHQFHV /LVWRI5HIHUHQFHV

>:LNLPHGLD@:LNLPHGLD  :LNLSHGLD7KH)UHH(QF\FORSHGLD:LNLPHGLD)RXQGDWLRQ >:LNLPHGLD@:LNLPHGLD  :LNLSHGLD7KH)UHH(QF\FORSHGLD:LNLPHGLD)RXQGDWLRQ


6W3HWHUVEXUJ)/86:HEVLWHKWWSHQZLNLSHGLDRUJDFFHVVHG$XJ 6W3HWHUVEXUJ)/86:HEVLWHKWWSHQZLNLSHGLDRUJDFFHVVHG$XJ
>:LONLQV 6KDUS@:LONLQV1-0 6KDUS-9  µ/RFDOLVHGFRUURVLRQRI >:LONLQV 6KDUS@:LONLQV1-0 6KDUS-9  µ/RFDOLVHGFRUURVLRQRI
UHLQIRUFHPHQWLQPDULQHFRQFUHWH¶SS±,Q3DJH&/7UHDGDZD\.:- %DPIRUWK UHLQIRUFHPHQWLQPDULQHFRQFUHWH¶SS±,Q3DJH&/7UHDGDZD\.:- %DPIRUWK
3% (GV &RUURVLRQRIUHLQIRUFHPHQWLQFRQFUHWH/RQGRQ8.(OVHYLHU$SSOLHG6FLHQFHVW 3% (GV &RUURVLRQRIUHLQIRUFHPHQWLQFRQFUHWH/RQGRQ8.(OVHYLHU$SSOLHG6FLHQFHVW
HGLWLRQ HGLWLRQ
>:LQHWDO@:LQ3:DWDQDEH0 0DFKLGD$  µ3HQHWUDWLRQ3URILOHRI&KORULGH >:LQHWDO@:LQ3:DWDQDEH0 0DFKLGD$  µ3HQHWUDWLRQ3URILOHRI&KORULGH
,RQVLQ&UDFNHG5HLQIRUFHG&RQFUHWH¶&HPHQWDQG&RQFUHWH5HVHDUFKSS± ,RQVLQ&UDFNHG5HLQIRUFHG&RQFUHWH¶&HPHQWDQG&RQFUHWH5HVHDUFKSS±
>:LWWHNLQGW@:LWWHNLQGW:  µ$FLGUHVLVWLQJ2FUDWFRQFUHWH¶=HPHQW.DON*LSV   >:LWWHNLQGW@:LWWHNLQGW:  µ$FLGUHVLVWLQJ2FUDWFRQFUHWH¶=HPHQW.DON*LSV  
SS±*HUPDQODQJXDJH SS±*HUPDQODQJXDJH
>:28@:28  3RXUEDL['LDJUDPV:HVWHUQ2UHJRQ8QLYHUVLW\ :28 0RQPRXWK >:28@:28  3RXUEDL['LDJUDPV:HVWHUQ2UHJRQ8QLYHUVLW\ :28 0RQPRXWK
2586$:HEVLWHKWWSZZZZRXHGXDFFHVVHG$XJ 2586$:HEVLWHKWWSZZZZRXHGXDFFHVVHG$XJ
><DZV@<DZV&/  <DZV¶+DQGERRNRI7KHUPRG\QDPLFDQG3K\VLFDO3URSHUWLHVRI ><DZV@<DZV&/  <DZV¶+DQGERRNRI7KHUPRG\QDPLFDQG3K\VLFDO3URSHUWLHVRI
&KHPLFDO&RPSRXQGV.QRYHO&RUSRUDWLRQ1HZ<RUN1<86$:HEVLWHKWWSZZZNQRYHOFRP &KHPLFDO&RPSRXQGV.QRYHO&RUSRUDWLRQ1HZ<RUN1<86$:HEVLWHKWWSZZZNQRYHOFRP
DFFHVVHG6HS DFFHVVHG6HS
><HRPDQV@<HRPDQV65  *DOYDQL]HG6WHHO5HLQIRUFHPHQWLQ&RQFUHWH/RQGRQ8. ><HRPDQV@<HRPDQV65  *DOYDQL]HG6WHHO5HLQIRUFHPHQWLQ&RQFUHWH/RQGRQ8.
(OVHYLHUVWHGLWLRQSS (OVHYLHUVWHGLWLRQSS
>=KDQJ 0DLOYDJDQDP@=KDQJ- 0DLOYDJDQDP13  µ&RUURVLRQRIFRQFUHWH >=KDQJ 0DLOYDJDQDP@=KDQJ- 0DLOYDJDQDP13  µ&RUURVLRQRIFRQFUHWH
UHLQIRUFHPHQWDQGHOHFWURFKHPLFDOIDFWRUVLQFRQFUHWHSDWFKUHSDLU¶&DQDGLDQ-RXUQDORI&LYLO UHLQIRUFHPHQWDQGHOHFWURFKHPLFDOIDFWRUVLQFRQFUHWHSDWFKUHSDLU¶&DQDGLDQ-RXUQDORI&LYLO
(QJLQHHULQJ  SS± (QJLQHHULQJ  SS±
>=KDQJ@=KDQJ;*  &RUURVLRQDQG(OHFWURFKHPLVWU\RI=LQF1HZ<RUN1<86$ >=KDQJ@=KDQJ;*  &RUURVLRQDQG(OHFWURFKHPLVWU\RI=LQF1HZ<RUN1<86$
3OHQXP3UHVVVWHGLWLRQSS 3OHQXP3UHVVVWHGLWLRQSS
 

;; 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;; 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 

/LVWRI)LJXUHV /LVWRI)LJXUHV
)LJXUH 6LPSOLILHG IORZ FKDUW IRU WKH GHVLJQ DQG LPSOHPHQWDWLRQ RI QHZ FRXQWHUPHDVXUHV 7KH )LJXUH 6LPSOLILHG IORZ FKDUW IRU WKH GHVLJQ DQG LPSOHPHQWDWLRQ RI QHZ FRXQWHUPHDVXUHV 7KH
JUH\VKDGHGDUHDVLQGLFDWHWKHGHVLJQSKDVHVRIFRQFHUQLQWKLVWKHVLVLHSKDVHVWR JUH\VKDGHGDUHDVLQGLFDWHWKHGHVLJQSKDVHVRIFRQFHUQLQWKLVWKHVLVLHSKDVHVWR
)LJXUH >$@,GHDOLVHGWHVWVHWXSVKRZLQJRQHVHWRILQVWUXPHQWHGPRUWDUVSHFLPHQDQGDHUDWHG )LJXUH >$@,GHDOLVHGWHVWVHWXSVKRZLQJRQHVHWRILQVWUXPHQWHGPRUWDUVSHFLPHQDQGDHUDWHG
H[WHUQDOFDWKRGHDQGWKHPRQLWRUHGVLJQDOV µ+¶ KLJKWHUPLQDODQG µ/¶ ORZWHUPLQDO H[WHUQDOFDWKRGHDQGWKHPRQLWRUHGVLJQDOV µ+¶ KLJKWHUPLQDODQG µ/¶ ORZWHUPLQDO
RI GDWDORJJHU  µ$¶  DQRGH DQG µ&¶  FDWKRGH FRQQHFWLRQ IRU PDFURFHOO FXUUHQW RI GDWDORJJHU  µ$¶  DQRGH DQG µ&¶  FDWKRGH FRQQHFWLRQ IRU PDFURFHOO FXUUHQW
PRQLWRULQJµ(&DW¶H[WHUQDOFDWKRGHDQGµ6&(¶VDWXUDWHGFDORPHOHOHFWURGH>%@7RS PRQLWRULQJµ(&DW¶H[WHUQDOFDWKRGHDQGµ6&(¶VDWXUDWHGFDORPHOHOHFWURGH>%@7RS
YLHZ RI LQVWUXPHQWHG PRUWDU VSHFLPHQ ZLWK LGHQWLILFDWLRQ RI HPEHGGHG HOHFWURGH ZLUHV YLHZ RI LQVWUXPHQWHG PRUWDU VSHFLPHQ ZLWK LGHQWLILFDWLRQ RI HPEHGGHG HOHFWURGH ZLUHV
µ((:V¶>&@$V>%@ZLWKLOOXVWUDWLRQRIXVLQJµ((:V¶DVHOHFWURGHVIRUHOHFWURFKHPLFDO µ((:V¶>&@$V>%@ZLWKLOOXVWUDWLRQRIXVLQJµ((:V¶DVHOHFWURGHVIRUHOHFWURFKHPLFDO
LPSHGDQFHVSHFWURVFRS\µ(,6¶µ:(¶ZRUNLQJHOHFWURGHµ5(¶UHIHUHQFHHOHFWURGHDQG LPSHGDQFHVSHFWURVFRS\µ(,6¶µ:(¶ZRUNLQJHOHFWURGHµ5(¶UHIHUHQFHHOHFWURGHDQG
µ&(¶ FRXQWHU HOHFWURGH $SDUW IURP WKH µ((:V¶ WKH FRORXUV XVHG IRU WKH FRQQHFWLRQV µ&(¶ FRXQWHU HOHFWURGH $SDUW IURP WKH µ((:V¶ WKH FRORXUV XVHG IRU WKH FRQQHFWLRQV
DJUHHZLWKWKHFRORXUFRGHXVHGLQ6HFWLRQ DJUHHZLWKWKHFRORXUFRGHXVHGLQ6HFWLRQ
)LJXUH ([HPSOLILFDWLRQ RI WKH DUUDQJHPHQW RI VSHFLPHQV WHVWHG LQ WKH FKORULGH H[SRVXUH VHWXS )LJXUH ([HPSOLILFDWLRQ RI WKH DUUDQJHPHQW RI VSHFLPHQV WHVWHG LQ WKH FKORULGH H[SRVXUH VHWXS
IRUWKHFRQFOXGLQJH[SHULPHQWV FI6HFWLRQ µ(&DW¶H[WHUQDOFDWKRGH IRUWKHFRQFOXGLQJH[SHULPHQWV FI6HFWLRQ µ(&DW¶H[WHUQDOFDWKRGH
)LJXUH )H+2 3RXUEDL[ GLDJUDP EDVHG RQ 7DEOH  ZLWK )HLD  í PRO/ >$@ 'RPLQDQW )LJXUH )H+2 3RXUEDL[ GLDJUDP EDVHG RQ 7DEOH  ZLWK )HLD  í PRO/ >$@ 'RPLQDQW
VSHFLHVLQWKHLUDVVRFLDWHGVWDELOLW\GRPDLQV>%@,GHQWLILFDWLRQRILPPXQHSDVVLYHDQG VSHFLHVLQWKHLUDVVRFLDWHGVWDELOLW\GRPDLQV>%@,GHQWLILFDWLRQRILPPXQHSDVVLYHDQG
FRUURVLYHGRPDLQVDQGODEHOOLQJIRUGHVFULSWLRQRIHTXLOLEULXPOLQHV FRUURVLYHGRPDLQVDQGODEHOOLQJIRUGHVFULSWLRQRIHTXLOLEULXPOLQHV
)LJXUH 3ORW RI µ(¶ DV IXQFWLRQ RI ORJ RI FXUUHQW GHQVLW\ µL¶ LOOXVWUDWLQJ WKH DFWLYDWLRQ )LJXUH 3ORW RI µ(¶ DV IXQFWLRQ RI ORJ RI FXUUHQW GHQVLW\ µL¶ LOOXVWUDWLQJ WKH DFWLYDWLRQ
RYHUSRWHQWLDO µȘDFW¶ µ(¶ HTXLOLEULXP SRWHQWLDOµL¶ H[FKDQJH FXUUHQW GHQVLW\ DQG µE¶ RYHUSRWHQWLDO µȘDFW¶ µ(¶ HTXLOLEULXP SRWHQWLDOµL¶ H[FKDQJH FXUUHQW GHQVLW\ DQG µE¶
7DIHO FRQVWDQW ,QGLFHV µD¶ DQG µF¶ GHQRWH DQRGLF DQG FDWKRGLF UHDFWLRQV UHVSHFWLYHO\ 7DIHO FRQVWDQW ,QGLFHV µD¶ DQG µF¶ GHQRWH DQRGLF DQG FDWKRGLF UHDFWLRQV UHVSHFWLYHO\
)RUµLD¶ µLF¶ µL¶LVµȘDFW¶ $IWHUFRPELQHGLQIRUPDWLRQIURP>-RQHV0¡OOHU )RUµLD¶ µLF¶ µL¶LVµȘDFW¶ $IWHUFRPELQHGLQIRUPDWLRQIURP>-RQHV0¡OOHU
E%DUGDO@ E%DUGDO@
)LJXUH 3ORW RI WKH HOHFWURGH SRWHQWLDO µ(¶ DV IXQFWLRQ RI WKH ORJ RI WKH FXUUHQW GHQVLW\ µL¶ )LJXUH 3ORW RI WKH HOHFWURGH SRWHQWLDO µ(¶ DV IXQFWLRQ RI WKH ORJ RI WKH FXUUHQW GHQVLW\ µL¶
LOOXVWUDWLQJWKH FDWKRGLF FRQFHQWUDWLRQRYHUSRWHQWLDOµȘFRQ¶7KHGRWWHGOLQHVLQGLFDWHWKH LOOXVWUDWLQJWKH FDWKRGLF FRQFHQWUDWLRQRYHUSRWHQWLDOµȘFRQ¶7KHGRWWHGOLQHVLQGLFDWHWKH
HIIHFW RI VROXWLRQ FRQGLWLRQV $IWHU FRPELQHG LQIRUPDWLRQ IURP >-RQHV  0¡OOHU HIIHFW RI VROXWLRQ FRQGLWLRQV $IWHU FRPELQHG LQIRUPDWLRQ IURP >-RQHV  0¡OOHU
E@ E@
)LJXUH 3ORW RI WKH HOHFWURGH SRWHQWLDO µ(¶ DV IXQFWLRQ RI WKH ORJ RI WKH FXUUHQW GHQVLW\ µL¶ )LJXUH 3ORW RI WKH HOHFWURGH SRWHQWLDO µ(¶ DV IXQFWLRQ RI WKH ORJ RI WKH FXUUHQW GHQVLW\ µL¶
LOOXVWUDWLQJ D VFKHPDWLF SRODULVDWLRQ FXUYH LQ WKH YLFLQLW\ RI WKH FRUURVLRQ SRWHQWLDO LOOXVWUDWLQJ D VFKHPDWLF SRODULVDWLRQ FXUYH LQ WKH YLFLQLW\ RI WKH FRUURVLRQ SRWHQWLDO
µ(FRUU¶ µ(¶ HTXLOLEULXP SRWHQWLDO µL¶ H[FKDQJH FXUUHQW GHQVLW\ µLFRUU¶ FRUURVLRQ µ(FRUU¶ µ(¶ HTXLOLEULXP SRWHQWLDO µL¶ H[FKDQJH FXUUHQW GHQVLW\ µLFRUU¶ FRUURVLRQ
FXUUHQWGHQVLW\µȘ¶ RYHUSRWHQWLDOµE¶7DIHOFRQVWDQWDQG µ3R&X¶ SRODULVDWLRQFXUYH FXUUHQWGHQVLW\µȘ¶ RYHUSRWHQWLDOµE¶7DIHOFRQVWDQWDQG µ3R&X¶ SRODULVDWLRQFXUYH
,QGLFHVµD¶DQGµF¶GHQRWHDQRGLFDQGFDWKRGLFUHDFWLRQVUHVSHFWLYHO\7KHHIIHFWRIDQ ,QGLFHVµD¶DQGµF¶GHQRWHDQRGLFDQGFDWKRGLFUHDFWLRQVUHVSHFWLYHO\7KHHIIHFWRIDQ
DVVXPHGLQFUHDVHGµLF¶RQµLFRUU¶LVLOOXVWUDWHGE\DVWHULVNV$IWHUFRPELQHGLQIRUPDWLRQ DVVXPHGLQFUHDVHGµLF¶RQµLFRUU¶LVLOOXVWUDWHGE\DVWHULVNV$IWHUFRPELQHGLQIRUPDWLRQ
IURP>-RQHV.UXJHU%DUGDO@ IURP>-RQHV.UXJHU%DUGDO@
)LJXUH 3ORW RI WKH HOHFWURGH SRWHQWLDO µ(¶ DV IXQFWLRQ RI WKH ORJ RI WKH FXUUHQW GHQVLW\ µL¶ )LJXUH 3ORW RI WKH HOHFWURGH SRWHQWLDO µ(¶ DV IXQFWLRQ RI WKH ORJ RI WKH FXUUHQW GHQVLW\ µL¶
SUHVHQWLQJ (YDQV GLDJUDPV WR LOOXVWUDWH WKUHH RSWLRQV RI FRUURVLRQ FRQWURO µ(¶ SUHVHQWLQJ (YDQV GLDJUDPV WR LOOXVWUDWH WKUHH RSWLRQV RI FRUURVLRQ FRQWURO µ(¶
HTXLOLEULXP SRWHQWLDO µ(FRUU¶ FRUURVLRQ SRWHQWLDO µLFRUU¶ FRUURVLRQ FXUUHQW GHQVLW\ HTXLOLEULXP SRWHQWLDO µ(FRUU¶ FRUURVLRQ SRWHQWLDO µLFRUU¶ FRUURVLRQ FXUUHQW GHQVLW\
,QGLFHV µD¶ DQG µF¶ GHQRWH DQRGLF DQG FDWKRGLF UHDFWLRQV UHVSHFWLYHO\ >$@ $QRGLF ,QGLFHV µD¶ DQG µF¶ GHQRWH DQRGLF DQG FDWKRGLF UHDFWLRQV UHVSHFWLYHO\ >$@ $QRGLF
FRQWURO>%@&DWKRGLFFRQWURO>&@0L[HGPRGH$IWHU>.UXJHU@ FRQWURO>%@&DWKRGLFFRQWURO>&@0L[HGPRGH$IWHU>.UXJHU@
)LJXUH +\SRWKHWLFDO FDWKRGLF DQG DQRGLF SRODULVDWLRQ FXUYH RI DQ DFWLYHSDVVLYH PHWDO ZLWK )LJXUH +\SRWKHWLFDO FDWKRGLF DQG DQRGLF SRODULVDWLRQ FXUYH RI DQ DFWLYHSDVVLYH PHWDO ZLWK
UHFRPPHQGHGWHUPLQRORJ\DQGDEEUHYLDWLRQVIRUWKHGHVFULSWLRQRISRODULVDWLRQFXUYHV UHFRPPHQGHGWHUPLQRORJ\DQGDEEUHYLDWLRQVIRUWKHGHVFULSWLRQRISRODULVDWLRQFXUYHV
)URP>$670*@ )URP>$670*@
)LJXUH >$@ $QRGLF SRODULVDWLRQ FXUYH IRU DQ DFWLYHSDVVLYH PHWDO LQ DQ HQYLURQPHQW FDXVLQJ )LJXUH >$@ $QRGLF SRODULVDWLRQ FXUYH IRU DQ DFWLYHSDVVLYH PHWDO LQ DQ HQYLURQPHQW FDXVLQJ
SLWWLQJ FRUURVLRQ µ(SLW¶ SLWWLQJ SRWHQWLDO µ(SS¶ SULPDU\ SDVVLYDWLRQ SRWHQWLDO µLS¶ SLWWLQJ FRUURVLRQ µ(SLW¶ SLWWLQJ SRWHQWLDO µ(SS¶ SULPDU\ SDVVLYDWLRQ SRWHQWLDO µLS¶
SDVVLYH FXUUHQW GHQVLW\ DQG µLFF¶ FULWLFDO FXUUHQW GHQVLW\ FI 6HFWLRQ   $IWHU SDVVLYH FXUUHQW GHQVLW\ DQG µLFF¶ FULWLFDO FXUUHQW GHQVLW\ FI 6HFWLRQ   $IWHU
>%DUGDO@>%@3RWHQWLRG\QDPLFDQRGLFSRODULVDWLRQFXUYHV VFDQUDWH P9V RI >%DUGDO@>%@3RWHQWLRG\QDPLFDQRGLFSRODULVDWLRQFXUYHV VFDQUDWH P9V RI
FDUERQ VWHHO LQ VDWXUDWHG &D 2+  VROXWLRQ FRQWDLQLQJ YDULRXV SHUFHQWDJHV RI &D&O FDUERQ VWHHO LQ VDWXUDWHG &D 2+  VROXWLRQ FRQWDLQLQJ YDULRXV SHUFHQWDJHV RI &D&O
$IWHU>3DJH 7UHDGDZD\@ $IWHU>3DJH 7UHDGDZD\@

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;;, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;;,


/LVWRI)LJXUHV /LVWRI)LJXUHV

)LJXUH &RPSDULVRQ RI 3RXUEDL[ GLDJUDP DQG VHOHFWHG SRODULVDWLRQ FXUYHV WR LOOXVWUDWH )LJXUH &RPSDULVRQ RI 3RXUEDL[ GLDJUDP DQG VHOHFWHG SRODULVDWLRQ FXUYHV WR LOOXVWUDWH
LQWHUUHODWLRQV EHWZHHQ WKHUPRG\QDPLFV DQG NLQHWLFV $IWHU FRPELQHG LQIRUPDWLRQ IURP LQWHUUHODWLRQV EHWZHHQ WKHUPRG\QDPLFV DQG NLQHWLFV $IWHU FRPELQHG LQIRUPDWLRQ IURP
>3RXUEDL[ D 0¡OOHU E %DUGDO  .$,67 @ 7KH GLVWLQJXLVKHG >3RXUEDL[ D 0¡OOHU E %DUGDO  .$,67 @ 7KH GLVWLQJXLVKHG
UHJLRQVLQWKH3RXUEDL[GLDJUDPDQGWKHSRODULVDWLRQFXUYHVDUHLQGLFDWHGE\WKHGDVKHG UHJLRQVLQWKH3RXUEDL[GLDJUDPDQGWKHSRODULVDWLRQFXUYHVDUHLQGLFDWHGE\WKHGDVKHG
OLQHV DQG WKH GRWWHGDQGGDVKHG OLQH IRU µ(SLW¶  DQG LQGH[HG  LQ WKH \HOORZ FLUFOHV OLQHV DQG WKH GRWWHGDQGGDVKHG OLQH IRU µ(SLW¶  DQG LQGH[HG  LQ WKH \HOORZ FLUFOHV
ZKLFKLVUHIHUUHGWRLQ7DEOH>$@)H+23RXUEDL[EDVHGRQ7DEOHDQG)HLD  ZKLFKLVUHIHUUHGWRLQ7DEOH>$@)H+23RXUEDL[EDVHGRQ7DEOHDQG)HLD 
í PRO/ FI )LJXUH   7KH VHOHFWHG S+ RI  IRU WKH HVWDEOLVKPHQW RI SRODULVDWLRQ í PRO/ FI )LJXUH   7KH VHOHFWHG S+ RI  IRU WKH HVWDEOLVKPHQW RI SRODULVDWLRQ
FXUYHVLVPDUNHGE\WKHUHGEOXHGDVKHGOLQHDQGDK\SRWKHWLFDOSLWWLQJSRWHQWLDOµ(SLW¶LV FXUYHVLVPDUNHGE\WKHUHGEOXHGDVKHGOLQHDQGDK\SRWKHWLFDOSLWWLQJSRWHQWLDOµ(SLW¶LV
PDUNHG E\ WKH EOXH OLQH >%@ 4XDOLWDWLYH SRODULVDWLRQ FXUYH IRU SDVVLYDWLRQ ZLWKRXW PDUNHG E\ WKH EOXH OLQH >%@ 4XDOLWDWLYH SRODULVDWLRQ FXUYH IRU SDVVLYDWLRQ ZLWKRXW
SUHPDWXUH GHSDVVLYDWLRQ >&@ 4XDOLWDWLYH SRODULVDWLRQ FXUYH IRU SUHPDWXUH SUHPDWXUH GHSDVVLYDWLRQ >&@ 4XDOLWDWLYH SRODULVDWLRQ FXUYH IRU SUHPDWXUH
GHSDVVLYDWLRQLQUHODWLRQWRWKHK\SRWKHWLFDOµ(SLW¶LQ>$@ GHSDVVLYDWLRQLQUHODWLRQWRWKHK\SRWKHWLFDOµ(SLW¶LQ>$@
)LJXUH *UDSKLFDOUHSUHVHQWDWLRQRIHOHFWURFKHPLFDOLPSHGDQFHVSHFWURVFRS\GDWDE\VFKHPDWLF )LJXUH *UDSKLFDOUHSUHVHQWDWLRQRIHOHFWURFKHPLFDOLPSHGDQFHVSHFWURVFRS\GDWDE\VFKHPDWLF
1\TXLVW SORWV ZLWK DVVRFLDWHG HTXLYDOHQW FLUFXLWV $IWHU >-RQHV @ >$@ &RUURGLQJ 1\TXLVW SORWV ZLWK DVVRFLDWHG HTXLYDOHQW FLUFXLWV $IWHU >-RQHV @ >$@ &RUURGLQJ
LQWHUIDFH VLPXODWHG E\ VROXWLRQ UHVLVWDQFH µ5ȍ¶ LQ VHULHV ZLWK SDUDOOHO FRQQHFWHG LQWHUIDFH VLPXODWHG E\ VROXWLRQ UHVLVWDQFH µ5ȍ¶ LQ VHULHV ZLWK SDUDOOHO FRQQHFWHG
SRODULVDWLRQUHVLVWDQFHµ5S¶DQGGRXEOHOD\HUFDSDFLWDQFHµ&GO¶>%@$V>$@DQG:DUEXUJ SRODULVDWLRQUHVLVWDQFHµ5S¶DQGGRXEOHOD\HUFDSDFLWDQFHµ&GO¶>%@$V>$@DQG:DUEXUJ
LPSHGDQFHµ:¶FRQQHFWHGLQVHULHVDIWHUµ5S¶DGGHGWRWKHHTXLYDOHQWFLUFXLW LPSHGDQFHµ:¶FRQQHFWHGLQVHULHVDIWHUµ5S¶DGGHGWRWKHHTXLYDOHQWFLUFXLW
)LJXUH 'HJUHDVLQJ LQ DONDOLQH EDWK $IWHU >0¡OOHU F@ >$@ 'HWHUJHQW FRQVLVWLQJ RI )LJXUH 'HJUHDVLQJ LQ DONDOLQH EDWK $IWHU >0¡OOHU F@ >$@ 'HWHUJHQW FRQVLVWLQJ RI
FRPSRXQG ZLWK K\GURSKLOLF DQG K\GURSKRELF SDUW >%@ +\GURSKRELF SDUW LQWUXGHV RLO FRPSRXQG ZLWK K\GURSKLOLF DQG K\GURSKRELF SDUW >%@ +\GURSKRELF SDUW LQWUXGHV RLO
DQGJUHDVH>&@+\GURSKRELFSDUWHPXOVLILHVRLODQGJUHDVHDQGRWKHUORRVHGHILOHPHQW DQGJUHDVH>&@+\GURSKRELFSDUWHPXOVLILHVRLODQGJUHDVHDQGRWKHUORRVHGHILOHPHQW
 
)LJXUH (OHFWURO\WLF GHJUHDVLQJ RI FDUERQ VWHHO VDPSOHV >$@ $QRGLF GHJUHDVLQJ RI UHEDU )LJXUH (OHFWURO\WLF GHJUHDVLQJ RI FDUERQ VWHHO VDPSOHV >$@ $QRGLF GHJUHDVLQJ RI UHEDU
VDPSOHVLQDONDOLQHEDWK>%@$FLGSLFNOLQJRIUHEDUVDPSOHV VDPSOHVLQDONDOLQHEDWK>%@$FLGSLFNOLQJRIUHEDUVDPSOHV
)LJXUH (OHFWURSODWLQJ RI ]LQF RQ JULWEODVWHG VPRRWK FDUERQ VWHHO UHEDU VDPSOH FI VSHFLPHQ )LJXUH (OHFWURSODWLQJ RI ]LQF RQ JULWEODVWHG VPRRWK FDUERQ VWHHO UHEDU VDPSOH FI VSHFLPHQ
W\SHV³&:´DQG³&:´LQ6HFWLRQ  W\SHV³&:´DQG³&:´LQ6HFWLRQ 
)LJXUH (IIHFW RI FHPHQW SDVWH SURSHUWLHV RQ R[\JHQ GLIIXVLRQ FRHIILFLHQW $IWHU >7XXWWL @ )LJXUH (IIHFW RI FHPHQW SDVWH SURSHUWLHV RQ R[\JHQ GLIIXVLRQ FRHIILFLHQW $IWHU >7XXWWL @
>$@ (IIHFW RI µZF¶ RQ WKH R[\JHQ GLIIXVLRQ FRHIILFLHQW LQ FHPHQW SDVWH DW  ZDWHU >$@ (IIHFW RI µZF¶ RQ WKH R[\JHQ GLIIXVLRQ FRHIILFLHQW LQ FHPHQW SDVWH DW  ZDWHU
VDWXUDWLRQ>%@(IIHFWRIZDWHUVDWXUDWLRQRQWKHR[\JHQGLIIXVLRQFRHIILFLHQWRIDQG VDWXUDWLRQ>%@(IIHFWRIZDWHUVDWXUDWLRQRQWKHR[\JHQGLIIXVLRQFRHIILFLHQWRIDQG
µZF¶FHPHQWSDVWHV µZF¶FHPHQWSDVWHV
)LJXUH 6FKHPDWLFUHSUHVHQWDWLRQRIWKHUDWHRIFDUERQDWLRQRIFRQFUHWHDVDIXQFWLRQRIUHODWLYH )LJXUH 6FKHPDWLFUHSUHVHQWDWLRQRIWKHUDWHRIFDUERQDWLRQRIFRQFUHWHDVDIXQFWLRQRIUHODWLYH
KXPLGLW\$IWHU>%HUWROLQLHWDO@ KXPLGLW\$IWHU>%HUWROLQLHWDO@
)LJXUH >$@'LIIXVLRQSURILOHVRIFKORULGHLRQVLQQRUPDODQGKLJKTXDOLW\FRQFUHWHZLWKGLIIXVLRQ )LJXUH >$@'LIIXVLRQSURILOHVRIFKORULGHLRQVLQQRUPDODQGKLJKTXDOLW\FRQFUHWHZLWKGLIIXVLRQ
FRHIILFLHQWV RI µ'¶ ×í PV DQG µ'¶  ×í PV UHVSHFWLYHO\ $IWHU  FRHIILFLHQWV RI µ'¶ ×í PV DQG µ'¶  ×í PV UHVSHFWLYHO\ $IWHU 
\HDUVRIGLIIXVLRQDVVXPLQJDFRQVWDQWFKORULGHLRQFRQFHQWUDWLRQRIµZZFH¶RQWKH \HDUVRIGLIIXVLRQDVVXPLQJDFRQVWDQWFKORULGHLRQFRQFHQWUDWLRQRIµZZFH¶RQWKH
FRQFUHWH VXUIDFH FI 6HFWLRQ   $IWHU >%HQWXU HWDO @ >%@ ([DPSOH RI FRQFUHWH VXUIDFH FI 6HFWLRQ   $IWHU >%HQWXU HWDO @ >%@ ([DPSOH RI
FKORULGH SURILOHV LQ D PDULQH VWUXFWXUH DV D IXQFWLRQ RI WKH KHLJKW DERYH WKH VHDZDWHU FKORULGH SURILOHV LQ D PDULQH VWUXFWXUH DV D IXQFWLRQ RI WKH KHLJKW DERYH WKH VHDZDWHU
OHYHO$IWHU>%HUWROLQLHWDO@ OHYHO$IWHU>%HUWROLQLHWDO@
)LJXUH >$@ (IIHFW RI ZDWHU VDWXUDWLRQ DQG µZF¶ RQ WKH UHVLVWLYLW\ RI FRQFUHWH H[HPSOLILHG IRU )LJXUH >$@ (IIHFW RI ZDWHU VDWXUDWLRQ DQG µZF¶ RQ WKH UHVLVWLYLW\ RI FRQFUHWH H[HPSOLILHG IRU
FRQFUHWHVZLWKµZF¶UDWLRVRIDQG$IWHU>7XXWWL@>%@(IIHFWRIFKORULGHLRQ FRQFUHWHVZLWKµZF¶UDWLRVRIDQG$IWHU>7XXWWL@>%@(IIHFWRIFKORULGHLRQ
DQG PRLVWXUH FRQWHQW RQ WKH UHVLVWLYLW\ RI FRQFUHWH H[HPSOLILHG IRU FKORULGH FRQWHQWV RI DQG PRLVWXUH FRQWHQW RQ WKH UHVLVWLYLW\ RI FRQFUHWH H[HPSOLILHG IRU FKORULGH FRQWHQWV RI
DQGµZZFR¶$IWHU>%HQWXUHWDO@ DQGµZZFR¶$IWHU>%HQWXUHWDO@
)LJXUH ([SRVXUHDQGFRUURVLRQ]RQHVLQPDULQHHQYLURQPHQW)URP>:LONLQV 6KDUS@ )LJXUH ([SRVXUHDQGFRUURVLRQ]RQHVLQPDULQHHQYLURQPHQW)URP>:LONLQV 6KDUS@
)LJXUH 4XDOLWDWLYH GHSHQGHQFH RI FKORULGH WKUHVKROG RQ FRQFUHWH SURSHUWLHV DQG H[SRVXUH )LJXUH 4XDOLWDWLYH GHSHQGHQFH RI FKORULGH WKUHVKROG RQ FRQFUHWH SURSHUWLHV DQG H[SRVXUH
FRQGLWLRQV$IWHU>ILE@ FRQGLWLRQV$IWHU>ILE@
)LJXUH >$@ 3HUSHQGLFXODU FUDFNV DQG GHERQGLQJ DORQJ WKH UHEDU RI D EHDP XQGHU IOH[XUDO )LJXUH >$@ 3HUSHQGLFXODU FUDFNV DQG GHERQGLQJ DORQJ WKH UHEDU RI D EHDP XQGHU IOH[XUDO
ORDGLQJ)URPUHVHDUFKDW'78%\J>3HDVHHWDO@XVLQJ$5$0,6'GHIRUPDWLRQ ORDGLQJ)URPUHVHDUFKDW'78%\J>3HDVHHWDO@XVLQJ$5$0,6'GHIRUPDWLRQ
DQDO\VLV >*20 @ >%@ 6KULQNDJH FUDFNV LQ FRQFUHWH VODE )URP >)ULHGPDQQ DQDO\VLV >*20 @ >%@ 6KULQNDJH FUDFNV LQ FRQFUHWH VODE )URP >)ULHGPDQQ
@ @
)LJXUH (IIHFWRIFRQFUHWHTXDOLW\RQFRUURVLRQPHFKDQLVPIRUFUDFNV$IWHU>6FKLH‰O 5DXSDFK )LJXUH (IIHFWRIFRQFUHWHTXDOLW\RQFRUURVLRQPHFKDQLVPIRUFUDFNV$IWHU>6FKLH‰O 5DXSDFK
@>$@'HQVHFRQFUHWHOHDGLQJWRPLFURFHOOFRUURVLRQZLWKFDWKRGHUHDFWLRQOLPLWHG @>$@'HQVHFRQFUHWHOHDGLQJWRPLFURFHOOFRUURVLRQZLWKFDWKRGHUHDFWLRQOLPLWHG
WR FUDFN >%@ 3RURXV FRQFUHWH OHDGLQJ WR PDFURFHOO FRUURVLRQ ZLWK FDWKRGH UHDFWLRQ WR FUDFN >%@ 3RURXV FRQFUHWH OHDGLQJ WR PDFURFHOO FRUURVLRQ ZLWK FDWKRGH UHDFWLRQ
SRVVLEOHLQXQFUDFNHGFRQFUHWH SRVVLEOHLQXQFUDFNHGFRQFUHWH
)LJXUH 6DOYDJH VHSDUDWLRQ IRU UHF\FOLQJ RI UHLQIRUFHG FRQFUHWH LQ &KLFDJR ,/ 86$ )URP )LJXUH 6DOYDJH VHSDUDWLRQ IRU UHF\FOLQJ RI UHLQIRUFHG FRQFUHWH LQ &KLFDJR ,/ 86$ )URP
>%UDQGHQEXUJ@ >%UDQGHQEXUJ@
)LJXUH /RZ UHVROXWLRQ OLJKW RSWLFDO PLFURVFRS\ RI HWFKHG FDUERQ VWHHO VDPSOH >$@ &URVV )LJXUH /RZ UHVROXWLRQ OLJKW RSWLFDO PLFURVFRS\ RI HWFKHG FDUERQ VWHHO VDPSOH >$@ &URVV
VHFWLRQ>%@/RQJLWXGLQDOVHFWLRQ VHFWLRQ>%@/RQJLWXGLQDOVHFWLRQ

;;,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;;,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 /LVWRI)LJXUHV  /LVWRI)LJXUHV

)LJXUH /LJKW RSWLFDO PLFURVFRS\ RI XQHWFKHG FDUERQ VWHHO VDPSOH >$@ &URVV VHFWLRQ >%@ )LJXUH /LJKW RSWLFDO PLFURVFRS\ RI XQHWFKHG FDUERQ VWHHO VDPSOH >$@ &URVV VHFWLRQ >%@
/RQJLWXGLQDOVHFWLRQ /RQJLWXGLQDOVHFWLRQ
)LJXUH +LJK PDJQLILFDWLRQ OLJKW RSWLFDO PLFURVFRS\ RI ORQJLWXGLQDO VHFWLRQ RI HWFKHG FDUERQ )LJXUH +LJK PDJQLILFDWLRQ OLJKW RSWLFDO PLFURVFRS\ RI ORQJLWXGLQDO VHFWLRQ RI HWFKHG FDUERQ
VWHHOVDPSOH VWHHOVDPSOH
)LJXUH 6FDQQLQJHOHFWURQPLFURVFRS\RIHGJHRIFURVVVHFWLRQRIHWFKHGFDUERQVWHHOVDPSOH>$@ )LJXUH 6FDQQLQJHOHFWURQPLFURVFRS\RIHGJHRIFURVVVHFWLRQRIHWFKHGFDUERQVWHHOVDPSOH>$@
DQG>&@6HFRQGDU\HOHFWURQ>%@DQG>'@%DFNVFDWWHUHG DQG>&@6HFRQGDU\HOHFWURQ>%@DQG>'@%DFNVFDWWHUHG
)LJXUH &KORULGH WKUHVKROG DV IXQFWLRQ RI LQWHUIDFLDO YRLGV $ TXDOLWDWLYH DYHUDJH RI XQWUHDWHG )LJXUH &KORULGH WKUHVKROG DV IXQFWLRQ RI LQWHUIDFLDO YRLGV $ TXDOLWDWLYH DYHUDJH RI XQWUHDWHG
UHIHUHQFHVDPSOHVLVJLYHQE\WKHUHGOLQH7KHEOXHGRWLQGLFDWHVWKHWKUHVKROGPHDVXUHG UHIHUHQFHVDPSOHVLVJLYHQE\WKHUHGOLQH7KHEOXHGRWLQGLFDWHVWKHWKUHVKROGPHDVXUHG
IRUVDPSOHVWKDWKDYHEHHQHOHFWURFKHPLFDOO\WUHDWHGGXULQJVHWWLQJRIWKHFRQFUHWH FI IRUVDPSOHVWKDWKDYHEHHQHOHFWURFKHPLFDOO\WUHDWHGGXULQJVHWWLQJRIWKHFRQFUHWH FI
6HFWLRQ $IWHU>%XHQIHOGHWDO@ 6HFWLRQ $IWHU>%XHQIHOGHWDO@
)LJXUH 5HODWLRQVKLS EHWZHHQ WKH IRXU WKHUPRG\QDPLF SRWHQWLDOV LQWHUQDO HQHUJ\ µ8¶  )LJXUH 5HODWLRQVKLS EHWZHHQ WKH IRXU WKHUPRG\QDPLF SRWHQWLDOV LQWHUQDO HQHUJ\ µ8¶ 
+HOPKROW] IUHH HQHUJ\ µ$¶  HQWKDOS\ µ+¶ DQG *LEEV IUHH HQHUJ\ µ*¶ H[SUHVVHG E\ +HOPKROW] IUHH HQHUJ\ µ$¶  HQWKDOS\ µ+¶ DQG *LEEV IUHH HQHUJ\ µ*¶ H[SUHVVHG E\
RIIVHWVRIWKHHQHUJ\IURPWKHHQYLURQPHQWLHWKHSURGXFWµ7¶×µ6¶DQGWKHH[SDQVLRQ RIIVHWVRIWKHHQHUJ\IURPWKHHQYLURQPHQWLHWKHSURGXFWµ7¶×µ6¶DQGWKHH[SDQVLRQ
ZRUNLHWKHSURGXFW µ3¶ × µ9¶ $IWHU>6FKURHGHU@ ZRUNLHWKHSURGXFW µ3¶ × µ9¶ $IWHU>6FKURHGHU@
)LJXUH )H+2 µ6(3'V¶ EDVHG RQ 7DEOH  DQG GLIIHUHQW )HLD >$@ )HLD  í PRO/ DV )LJXUH )H+2 µ6(3'V¶ EDVHG RQ 7DEOH  DQG GLIIHUHQW )HLD >$@ )HLD  í PRO/ DV
FRQVHUYDWLYHYDOXHIRUSDVVLYHVWDELOLW\GRPDLQV>%@)HLD íPRO/>&@)HLDĺ FRQVHUYDWLYHYDOXHIRUSDVVLYHVWDELOLW\GRPDLQV>%@)HLD íPRO/>&@)HLDĺ
PRO/ LH SUHGRPLQDQFH GRPDLQV RI LURQ LRQV 'LDJUDPV >%@ DQG >&@ DUH IRU PRO/ LH SUHGRPLQDQFH GRPDLQV RI LURQ LRQV 'LDJUDPV >%@ DQG >&@ DUH IRU
H[HPSOLILFDWLRQSXUSRVHVRQO\DQGGRQRWUHSUHVHQWDFWXDOFRQGLWLRQV H[HPSOLILFDWLRQSXUSRVHVRQO\DQGGRQRWUHSUHVHQWDFWXDOFRQGLWLRQV
)LJXUH )H+2µ6(3'V¶EDVHGRQ7DEOHZLWK)HLD>$@)HLD íPRO/>%@)HLD í )LJXUH )H+2µ6(3'V¶EDVHGRQ7DEOHZLWK)HLD>$@)HLD íPRO/>%@)HLD í
PRO/>&@)HLD PRO/ PRO/>&@)HLD PRO/
)LJXUH )H+2 µ6(3'¶ EDVHG RQ 7DEOH  DQG )HLD  í PRO/ ,GHQWLILFDWLRQ RI SRVVLEOH )LJXUH )H+2 µ6(3'¶ EDVHG RQ 7DEOH  DQG )HLD  í PRO/ ,GHQWLILFDWLRQ RI SRVVLEOH
UDQJH RI µ(FRUU¶ DQG S+ IRU FDUERQ VWHHO LQ $  RUJDQLF ULFK ODNH ZDWHU DQG %  UDQJH RI µ(FRUU¶ DQG S+ IRU FDUERQ VWHHO LQ $  RUJDQLF ULFK ODNH ZDWHU DQG % 
XQFRQWDPLQDWHGVHPLVDWXUDWHGFRQFUHWH XQFRQWDPLQDWHGVHPLVDWXUDWHGFRQFUHWH
)LJXUH 7UDGLWLRQDOIXQGDPHQWDOPHFKDQLVPIRUFRUURVLRQRIVWHHOLQFRQFUHWH$IWHU>%URRPILHOG )LJXUH 7UDGLWLRQDOIXQGDPHQWDOPHFKDQLVPIRUFRUURVLRQRIVWHHOLQFRQFUHWH$IWHU>%URRPILHOG
@7KLVPHFKDQLVPLVSURSRVHGWREHPRGLILHGVHH)LJXUH @7KLVPHFKDQLVPLVSURSRVHGWREHPRGLILHGVHH)LJXUH
)LJXUH 3URSRVHGIXQGDPHQWDOPHFKDQLVPIRUSDVVLYHDQGDFWLYHFRUURVLRQRIVWHHOLQFRQFUHWH )LJXUH 3URSRVHGIXQGDPHQWDOPHFKDQLVPIRUSDVVLYHDQGDFWLYHFRUURVLRQRIVWHHOLQFRQFUHWH
 
)LJXUH >$@)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/2ZQPHDVXUHPHQWVIURP )LJXUH >$@)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/2ZQPHDVXUHPHQWVIURP
µ7HVW,¶RISDVVLYHFDUERQVWHHOZLWKGLIIHUHQWVXUIDFHSURSHUWLHVHPEHGGHGLQPRUWDU FI µ7HVW,¶RISDVVLYHFDUERQVWHHOZLWKGLIIHUHQWVXUIDFHSURSHUWLHVHPEHGGHGLQPRUWDU FI
6HFWLRQ   DUH LQGLFDWHG E\ WKH FRORXUHG EDUV WRS WR ERWWRP  ZHDWKHUHG ³&$´ 6HFWLRQ   DUH LQGLFDWHG E\ WKH FRORXUHG EDUV WRS WR ERWWRP  ZHDWKHUHG ³&$´
UHG  DVUHFHLYHG ³&$´ EOXH  GHJUHDVHG ³&$´ JUHHQ  +&O HWFKHG ³&$´ UHG  DVUHFHLYHG ³&$´ EOXH  GHJUHDVHG ³&$´ JUHHQ  +&O HWFKHG ³&$´
\HOORZ  DQG JULWEODVWHG ³&$´ RUDQJH  >%@ $V >$@EXW ZLWK GHVHOHFWLRQ RI )H2 \HOORZ  DQG JULWEODVWHG ³&$´ RUDQJH  >%@ $V >$@EXW ZLWK GHVHOHFWLRQ RI )H2
IRU H[HPSOLILFDWLRQ SXUSRVHV RQO\  >&@ &D&+2 µ0(3'¶ EDVHG RQ 7DEOH  DQG IRU H[HPSOLILFDWLRQ SXUSRVHV RQO\  >&@ &D&+2 µ0(3'¶ EDVHG RQ 7DEOH  DQG
&DLD íPRO/DQG&LD íPRO/ &DLD íPRO/DQG&LD íPRO/
)LJXUH )H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/ZLWKSURSRVHGPHFKDQLVPIRU )LJXUH )H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/ZLWKSURSRVHGPHFKDQLVPIRU
FDUERQDWLRQ LQGXFHG FRUURVLRQ LQ VHPLVDWXUDWHG FRQFUHWH ,GHQWLILFDWLRQ RI SRVVLEOH FDUERQDWLRQ LQGXFHG FRUURVLRQ LQ VHPLVDWXUDWHG FRQFUHWH ,GHQWLILFDWLRQ RI SRVVLEOH
UDQJHRIµ(FRUU¶DQGS+IRU $ DYHUDJHRIFDUERQVWHHOLQXQFRQWDPLQDWHGFRQFUHWH %  UDQJHRIµ(FRUU¶DQGS+IRU $ DYHUDJHRIFDUERQVWHHOLQXQFRQWDPLQDWHGFRQFUHWH % 
DYHUDJH RI FDUERQ VWHHO LQ FDUERQDWHG FRQFUHWH EHIRUH FRUURVLRQ LQLWLDWLRQ &  DQRGLF DYHUDJH RI FDUERQ VWHHO LQ FDUERQDWHG FRQFUHWH EHIRUH FRUURVLRQ LQLWLDWLRQ &  DQRGLF
VLWHV RI FDUERQ VWHHO LQ FDUERQDWHG FRQFUHWH DW FRUURVLRQ LQLWLDWLRQ '  DQRGLF VLWHV RI VLWHV RI FDUERQ VWHHO LQ FDUERQDWHG FRQFUHWH DW FRUURVLRQ LQLWLDWLRQ '  DQRGLF VLWHV RI
FDUERQVWHHOLQFDUERQDWHGFRQFUHWHLQFRUURVLRQSURSDJDWLRQDQG ( FDWKRGLFVLWHVRI FDUERQVWHHOLQFDUERQDWHGFRQFUHWHLQFRUURVLRQSURSDJDWLRQDQG ( FDWKRGLFVLWHVRI
FDUERQVWHHOLQFDUERQDWHGFRQFUHWHLQFRUURVLRQSURSDJDWLRQ FDUERQVWHHOLQFDUERQDWHGFRQFUHWHLQFRUURVLRQSURSDJDWLRQ
)LJXUH 'DPDJH W\SHV UHVXOWLQJ IURP UHLQIRUFHPHQW FRUURVLRQ LQ R[\JHQULFK FRQFUHWH >$@ )LJXUH 'DPDJH W\SHV UHVXOWLQJ IURP UHLQIRUFHPHQW FRUURVLRQ LQ R[\JHQULFK FRQFUHWH >$@
&UDFNLQJ >%@ 6SDOOLQJ >&@ 'HODPLQDWLRQ >'@ &RPELQDWLRQ RI GDPDJH W\SHV DW &UDFNLQJ >%@ 6SDOOLQJ >&@ 'HODPLQDWLRQ >'@ &RPELQDWLRQ RI GDPDJH W\SHV DW
FRQFUHWHEULGJH$IWHU>665@ FRQFUHWHEULGJH$IWHU>665@
)LJXUH >$@ )H+2 µ6(3'¶ EDVHG RQ 7DEOH  DQG )HLD  í PRO/ ZLWK VXSHULPSRVHG )LJXUH >$@ )H+2 µ6(3'¶ EDVHG RQ 7DEOH  DQG )HLD  í PRO/ ZLWK VXSHULPSRVHG
SLWWLQJSRWHQWLDOFXUYHVIRUGLIIHUHQWFKORULGHFRQFHQWUDWLRQV&OSLWLD íPRO/&OSLWLD SLWWLQJSRWHQWLDOFXUYHVIRUGLIIHUHQWFKORULGHFRQFHQWUDWLRQV&OSLWLD íPRO/&OSLWLD
íPRO/DQG&OSLWLD PRO/$IWHU>1LOVVRQHWDO 6DQGEHUJ@>%@ íPRO/DQG&OSLWLD PRO/$IWHU>1LOVVRQHWDO 6DQGEHUJ@>%@
)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD í PRO/ZLWKDGGLWLRQDOVHOHFWLRQRI )H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD í PRO/ZLWKDGGLWLRQDOVHOHFWLRQRI
)H2í'LDJUDP>%@LVIRUH[HPSOLILFDWLRQSXUSRVHVRQO\DQGGRHVQRWUHSUHVHQWDFWXDO )H2í'LDJUDP>%@LVIRUH[HPSOLILFDWLRQSXUSRVHVRQO\DQGGRHVQRWUHSUHVHQWDFWXDO
FRQGLWLRQV FRQGLWLRQV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;;,,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;;,,,


/LVWRI)LJXUHV /LVWRI)LJXUHV

)LJXUH >$@)H+2µ6(3'¶EDVHGRQSUHVHOHFWLRQRIVSHFLHVDFFRUGLQJWR7DEOHDQG)HLD  )LJXUH >$@)H+2µ6(3'¶EDVHGRQSUHVHOHFWLRQRIVSHFLHVDFFRUGLQJWR7DEOHDQG)HLD 


í PRO/ DQG >%@ $V >$@ EXW GHVHOHFWLRQ RI )H2 DQG SUHVHOHFWLRQ RI )H22+ í PRO/ DQG >%@ $V >$@ EXW GHVHOHFWLRQ RI )H2 DQG SUHVHOHFWLRQ RI )H22+
DFFRUGLQJ WR 7DEOH  >&@ 3DUWLDO µ6,3'¶ ZLWK >%@ DV XQGHUO\LQJ µ6(3'¶ DQG DFFRUGLQJ WR 7DEOH  >&@ 3DUWLDO µ6,3'¶ ZLWK >%@ DV XQGHUO\LQJ µ6(3'¶ DQG
VXSHULPSRVHG VWDELOLW\ GRPDLQV RI µ*5¶ DV SRVWXODWHG LQ WKH OLWHUDWXUH LH $  µ*5¶ VXSHULPSRVHG VWDELOLW\ GRPDLQV RI µ*5¶ DV SRVWXODWHG LQ WKH OLWHUDWXUH LH $  µ*5¶
GRPDLQ IRU D &OLD  í PRO/ DIWHU >6DJRH&UHQWVLO  *ODVVHU @ DQG %  *5¶ GRPDLQ IRU D &OLD  í PRO/ DIWHU >6DJRH&UHQWVLO  *ODVVHU @ DQG %  *5¶
GRPDLQ IRU &OLD   PRO/ DIWHU >5HIDLW  *pQLQ @ 'LDJUDP >&@ LV IRU GRPDLQ IRU &OLD   PRO/ DIWHU >5HIDLW  *pQLQ @ 'LDJUDP >&@ LV IRU
H[HPSOLILFDWLRQ SXUSRVHV RQO\ DQG LW QHLWKHU UHSUHVHQWV DFWXDO FRQGLWLRQV QRU WKH H[DFW H[HPSOLILFDWLRQ SXUSRVHV RQO\ DQG LW QHLWKHU UHSUHVHQWV DFWXDO FRQGLWLRQV QRU WKH H[DFW
RULJLQDODVVXPSWLRQVRI>5HIDLW *pQLQ6DJRH&UHQWVLO *ODVVHU@ RULJLQDODVVXPSWLRQVRI>5HIDLW *pQLQ6DJRH&UHQWVLO *ODVVHU@
)LJXUH >$@)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/>%@)H&O+2µ0(3'¶ )LJXUH >$@)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/>%@)H&O+2µ0(3'¶
EDVHGRQ7DEOHDQG)HLD íPRO/DQG&OLD íPRO/>&@$V>%@EXW&OLD  EDVHGRQ7DEOHDQG)HLD íPRO/DQG&OLD íPRO/>&@$V>%@EXW&OLD 
PRO/ PRO/
)LJXUH )H&O+2 µ0(3'¶ EDVHG RQ 7DEOH  DQG )HLD  í PRO/ DQG &OLD   PRO/ )LJXUH )H&O+2 µ0(3'¶ EDVHG RQ 7DEOH  DQG )HLD  í PRO/ DQG &OLD   PRO/
)H&OZKLFKLVIDYRXUHGRYHU)HDWKLJKHU&OLDLVLQFOXGHGDVDQDOWHUQDWLYHVSHFLHVLQ )H&OZKLFKLVIDYRXUHGRYHU)HDWKLJKHU&OLDLVLQFOXGHGDVDQDOWHUQDWLYHVSHFLHVLQ
WKH DVVRFLDWHG VWDELOLW\ GRPDLQ >$@ ,GHQWLILFDWLRQ RI SLWWLQJ SRWHQWLDOV IRU FRUURVLRQ WKH DVVRFLDWHG VWDELOLW\ GRPDLQ >$@ ,GHQWLILFDWLRQ RI SLWWLQJ SRWHQWLDOV IRU FRUURVLRQ
LQLWLDWLRQ EDVHG RQ GLIIHUHQW FKORULGH FRQWHQWV EDVHG RQ SLWWLQJ SRWHQWLDO FXUYHV DIWHU LQLWLDWLRQ EDVHG RQ GLIIHUHQW FKORULGH FRQWHQWV EDVHG RQ SLWWLQJ SRWHQWLDO FXUYHV DIWHU
>1LOVVRQ HWDO  6DQGEHUJ @ >%@ ,GHQWLILFDWLRQ RI GLIIHUHQW WKHUPRG\QDPLF >1LOVVRQ HWDO  6DQGEHUJ @ >%@ ,GHQWLILFDWLRQ RI GLIIHUHQW WKHUPRG\QDPLF
VWDWHVFRQFHUQLQJWKHSURSRVHGPRGHOIRUFRUURVLRQSURSDJDWLRQ VWDWHVFRQFHUQLQJWKHSURSRVHGPRGHOIRUFRUURVLRQSURSDJDWLRQ
)LJXUH 6LPSOHWHVWWRGHWHUPLQHWKHVROXELOLW\RI)H22+>$@%HDNHUZLWK)H&OVROXWLRQ>%@ )LJXUH 6LPSOHWHVWWRGHWHUPLQHWKHVROXELOLW\RI)H22+>$@%HDNHUZLWK)H&OVROXWLRQ>%@
$GGLWLRQ RI 1D2+ WR VROXWLRQ >&@ 6ROXWLRQ DW S+  ZLWK EURZQLVK FRORXU LQGLFDWLQJ $GGLWLRQ RI 1D2+ WR VROXWLRQ >&@ 6ROXWLRQ DW S+  ZLWK EURZQLVK FRORXU LQGLFDWLQJ
SUHFLSLWDWLRQRI)H22+>'@$GGLWLRQRI+&OWRVROXWLRQ>(@6ROXWLRQDWS+LVGLOXWHG SUHFLSLWDWLRQRI)H22+>'@$GGLWLRQRI+&OWRVROXWLRQ>(@6ROXWLRQDWS+LVGLOXWHG
EXWEURZQLVKFRORXUUHPDLQVLQGLFDWLQJWKDW)H22+LVGLIILFXOWWRGLVVROYH EXWEURZQLVKFRORXUUHPDLQVLQGLFDWLQJWKDW)H22+LVGLIILFXOWWRGLVVROYH
)LJXUH 6NHWFK RI WKH SURSRVHG PHFKDQLVP IRU FKORULGH LQGXFHG FRUURVLRQ LQ R[\JHQ GHSULYHG )LJXUH 6NHWFK RI WKH SURSRVHG PHFKDQLVP IRU FKORULGH LQGXFHG FRUURVLRQ LQ R[\JHQ GHSULYHG
FRQFUHWH 7KH VNHWFK LOOXVWUDWHV WKH VHOIFRQWDLQHG ORRS EHWZHHQ WKH R[LGDWLRQ RI )H FRQFUHWH 7KH VNHWFK LOOXVWUDWHV WKH VHOIFRQWDLQHG ORRS EHWZHHQ WKH R[LGDWLRQ RI )H
)H&O  WR )H&O DQG WKH HWFKLQJ SURFHVV RI )H E\ )H&O LQ FRPELQDWLRQ ZLWK WKH )H&O  WR )H&O DQG WKH HWFKLQJ SURFHVV RI )H E\ )H&O LQ FRPELQDWLRQ ZLWK WKH
DVVRFLDWHGDFLGLILFDWLRQDQGSRUHEORFNLQJE\SUHFLSLWDWLRQRI)H22+ DVVRFLDWHGDFLGLILFDWLRQDQGSRUHEORFNLQJE\SUHFLSLWDWLRQRI)H22+
)LJXUH 6SOLW FKORULGH FRQWDPLQDWHG UHLQIRUFHG FRQFUHWH EORFN ZLWK D VHYHUHO\ FRUURGHG )LJXUH 6SOLW FKORULGH FRQWDPLQDWHG UHLQIRUFHG FRQFUHWH EORFN ZLWK D VHYHUHO\ FRUURGHG
HPEHGGHG FDUERQ VWHHO UHEDU 6SHFLPHQ IURP >1\JDDUG @ >$@ 3KHQROSKWKDOHLQ HPEHGGHG FDUERQ VWHHO UHEDU 6SHFLPHQ IURP >1\JDDUG @ >$@ 3KHQROSKWKDOHLQ
DSSOLHG RQ VSOLW IDFH FI 6HFWLRQ   DQG LGHQWLILFDWLRQ RI UHJLRQV RI LQWHUHVW >%@ DSSOLHG RQ VSOLW IDFH FI 6HFWLRQ   DQG LGHQWLILFDWLRQ RI UHJLRQV RI LQWHUHVW >%@
7UDFHVRIJUHHQUXVWDOVRUHIHUUHGWRDVµ*5¶RQWKHVSOLWVXUIDFHEHIRUHDSSOLFDWLRQRI 7UDFHVRIJUHHQUXVWDOVRUHIHUUHGWRDVµ*5¶RQWKHVSOLWVXUIDFHEHIRUHDSSOLFDWLRQRI
SKHQROSKWKDOHLQ SKHQROSKWKDOHLQ
)LJXUH >$@ 6HYHUHO\ FRUURGHG FKORULGH LQGXFHG  PRUWDU VSHFLPHQ ZLWK FHQWUDO JULWEODVWHG )LJXUH >$@ 6HYHUHO\ FRUURGHG FKORULGH LQGXFHG  PRUWDU VSHFLPHQ ZLWK FHQWUDO JULWEODVWHG
FDUERQ VWHHO UHEDU ZLWKRXW HPEHGGHG µ((:¶ VSHFLPHQ ³&%´ FI 6HFWLRQ   DW FDUERQ VWHHO UHEDU ZLWKRXW HPEHGGHG µ((:¶ VSHFLPHQ ³&%´ FI 6HFWLRQ   DW
WKHHQGRILWVH[SRVXUHSHULRG OHDGZLUHVDQG2ULQJUHPRYHG ,GHQWLILFDWLRQRIUHEDU WKHHQGRILWVH[SRVXUHSHULRG OHDGZLUHVDQG2ULQJUHPRYHG ,GHQWLILFDWLRQRIUHEDU
SRVLWLRQDQGRIVDZQIDFH FXWUHG DQGVDZQVSOLWIDFH FXWVSOLWEOXHJUHHQ >%@ SRVLWLRQDQGRIVDZQIDFH FXWUHG DQGVDZQVSOLWIDFH FXWVSOLWEOXHJUHHQ >%@
)UHVKVDZQIDFHFRUUHVSRQGLQJWRFXWOLQHZLWKµ*5¶SURWUXGLQJIURPWKHPRUWDUVWHHO )UHVKVDZQIDFHFRUUHVSRQGLQJWRFXWOLQHZLWKµ*5¶SURWUXGLQJIURPWKHPRUWDUVWHHO
LQWHUIDFH >&@ 6DZQVSOLW IDFH ZLWK 5DLQERZ LQGLFDWRU DSSOLHG FI 6HFWLRQ   LQWHUIDFH >&@ 6DZQVSOLW IDFH ZLWK 5DLQERZ LQGLFDWRU DSSOLHG FI 6HFWLRQ  
5DQJHV RI S+ \HOORZ QXPEHUV  LQGLFDWHG RQ VSOLW IDFH LQ DFFRUGDQFH ZLWK WKH FRORXU 5DQJHV RI S+ \HOORZ QXPEHUV  LQGLFDWHG RQ VSOLW IDFH LQ DFFRUGDQFH ZLWK WKH FRORXU
FRGH RI WKH UDLQERZ LQGLFDWRU FI 7DEOH  LQ 6HFWLRQ   ,GHQWLILFDWLRQ RI FRGH RI WKH UDLQERZ LQGLFDWRU FI 7DEOH  LQ 6HFWLRQ   ,GHQWLILFDWLRQ RI
PHDVXUHPHQWSRLQWVXVHGIRUHOHPHQWPDSSLQJLHSLQNGRWLQORZS+DUHD FI)LJXUH PHDVXUHPHQWSRLQWVXVHGIRUHOHPHQWPDSSLQJLHSLQNGRWLQORZS+DUHD FI)LJXUH
DQG)LJXUH DQGWXUTXRLVHGRWLQKLJKS+DUHD FI)LJXUH  DQG)LJXUH DQGWXUTXRLVHGRWLQKLJKS+DUHD FI)LJXUH 
)LJXUH (QHUJ\GLVSHUVLYHHOHPHQWPDSSLQJRIPHDVXUHPHQWSRLQWLQORZS+DUHD )LJXUH )LJXUH (QHUJ\GLVSHUVLYHHOHPHQWPDSSLQJRIPHDVXUHPHQWSRLQWLQORZS+DUHD )LJXUH
>&@ SLQN GRW  >$@ &DOFLXP >%@ &KORULGH >&@ ,URQ >'@ 6RGLXP >(@ 2[\JHQ >)@ >&@ SLQN GRW  >$@ &DOFLXP >%@ &KORULGH >&@ ,URQ >'@ 6RGLXP >(@ 2[\JHQ >)@
6LOLFRQ 6LOLFRQ
)LJXUH (QHUJ\GLVSHUVLYHVSHFWUXPRIPHDVXUHPHQWSRLQWLQORZS+DUHD )LJXUH>&@SLQN )LJXUH (QHUJ\GLVSHUVLYHVSHFWUXPRIPHDVXUHPHQWSRLQWLQORZS+DUHD )LJXUH>&@SLQN
GRW ;UD\HQHUJLHVRQWKH;D[LVDQGUHODWLYH;UD\FRXQWVRQWKH<D[LV GRW ;UD\HQHUJLHVRQWKH;D[LVDQGUHODWLYH;UD\FRXQWVRQWKH<D[LV
)LJXUH (QHUJ\ GLVSHUVLYH VSHFWUXP RI PHDVXUHPHQW SRLQW LQ KLJK S+ DUHD )LJXUH  >&@ )LJXUH (QHUJ\ GLVSHUVLYH VSHFWUXP RI PHDVXUHPHQW SRLQW LQ KLJK S+ DUHD )LJXUH  >&@
WXUTXRLVHGRW ;UD\HQHUJLHVRQWKH;D[LVDQGUHODWLYH;UD\FRXQWVRQWKH<D[LV WXUTXRLVHGRW ;UD\HQHUJLHVRQWKH;D[LVDQGUHODWLYH;UD\FRXQWVRQWKH<D[LV
)LJXUH >$@1RWFKOLNHVKDSHFRUURVLRQDWWDFNRIUHEDULQFKORULGHFRQWDPLQDWHGFRQFUHWH)URP )LJXUH >$@1RWFKOLNHVKDSHFRUURVLRQDWWDFNRIUHEDULQFKORULGHFRQWDPLQDWHGFRQFUHWH)URP
>&2:, E@ >%@ &ROODSVH RI SDUNLQJ JDUDJH LQ 0LQQHVRWD 86$ GXH WR FKORULGH >&2:, E@ >%@ &ROODSVH RI SDUNLQJ JDUDJH LQ 0LQQHVRWD 86$ GXH WR FKORULGH
LQGXFHGFRUURVLRQGDPDJH)URP>%RUJDUGHWDO@ LQGXFHGFRUURVLRQGDPDJH)URP>%RUJDUGHWDO@
)LJXUH >$@)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/>%@$V>$@EXW)HLD  )LJXUH >$@)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/>%@$V>$@EXW)HLD 
PRO/>&@)H&O+2µ0(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/DQG&OLD  PRO/>&@)H&O+2µ0(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/DQG&OLD 
PRO/ PRO/
)LJXUH 6WUXFWXUH RI QHZ (XURSHDQ VWDQGDUG VHULHV (1  >'6(1  @ $IWHU )LJXUH 6WUXFWXUH RI QHZ (XURSHDQ VWDQGDUG VHULHV (1  >'6(1  @ $IWHU
>5DXSDFK@ >5DXSDFK@

;;,9 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;;,9 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 /LVWRI)LJXUHV  /LVWRI)LJXUHV

)LJXUH ,QYHUVH FDUERQDWLRQ UHVLVWDQFH µ5&2í¶  FKORULGH PLJUDWLRQ FRHIILFLHQW µ'&O¶ )LJXUH ,QYHUVH FDUERQDWLRQ UHVLVWDQFH µ5&2í¶  FKORULGH PLJUDWLRQ FRHIILFLHQW µ'&O¶
HOHFWURO\WHUHVLVWDQFHµ5ȍ¶DQGPHDQFRPSUHVVLYHFXEHVWUHQJWK µIFPFXEH¶ IRUGLIIHUHQW HOHFWURO\WHUHVLVWDQFHµ5ȍ¶DQGPHDQFRPSUHVVLYHFXEHVWUHQJWK µIFPFXEH¶ IRUGLIIHUHQW
µZF¶ UDWLRV RI 3RUWODQG FHPHQW FRQFUHWH µ&(0 ,¶  3RUWODQG IO\DVK FHPHQW FRQFUHWH µZF¶ UDWLRV RI 3RUWODQG FHPHQW FRQFUHWH µ&(0 ,¶  3RUWODQG IO\DVK FHPHQW FRQFUHWH
µ&(0 ,  6)$¶  DQG EODVWIXUQDFH FRQFUHWH &(0 ,,,  6XPPDU\ RI GDWD DQG ILJXUHV µ&(0 ,  6)$¶  DQG EODVWIXUQDFH FRQFUHWH &(0 ,,,  6XPPDU\ RI GDWD DQG ILJXUHV
SURYLGHG LQ >*HKOHQ @ FI >'6(1  @ IRU FHPHQW W\SHV DQG >*HKOHQ SURYLGHG LQ >*HKOHQ @ FI >'6(1  @ IRU FHPHQW W\SHV DQG >*HKOHQ
@IRUWKHFRQFUHWHFRPSRVLWLRQVDQGFXULQJFRQGLWLRQV @IRUWKHFRQFUHWHFRPSRVLWLRQVDQGFXULQJFRQGLWLRQV
)LJXUH &ODVVHVRIVXUIDFHWUHDWPHQW>$@&RQWLQXRXVILOPDFKLHYHGE\FRDWLQJVDQGVHDOHUV>%@ )LJXUH &ODVVHVRIVXUIDFHWUHDWPHQW>$@&RQWLQXRXVILOPDFKLHYHGE\FRDWLQJVDQGVHDOHUV>%@
+\GURSKRELF OD\HU DFKLHYHG E\ SRUHOLQHUV >&@ 5HDFWLRQ SURGXFWV EORFNLQJ SRUHV +\GURSKRELF OD\HU DFKLHYHG E\ SRUHOLQHUV >&@ 5HDFWLRQ SURGXFWV EORFNLQJ SRUHV
DFKLHYHG E\ SRUHEORFNHUV >'@ 7KLFN GHQVH VXUIDFH OD\HU DFKLHYHG E\ FHPHQWLWLRXV DFKLHYHG E\ SRUHEORFNHUV >'@ 7KLFN GHQVH VXUIDFH OD\HU DFKLHYHG E\ FHPHQWLWLRXV
FRDWLQJV$IWHU>0D\VHWDO@ FRDWLQJV$IWHU>0D\VHWDO@
)LJXUH >$@)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/>%@µ6,3'¶RIWKH&U )LJXUH >$@)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/>%@µ6,3'¶RIWKH&U
+2µ6(3'¶EDVHGRQ7DEOHDQG&ULD íPRO/RQ>$@>&@µ6,3'¶RIWKH&U)H +2µ6(3'¶EDVHGRQ7DEOHDQG&ULD íPRO/RQ>$@>&@µ6,3'¶RIWKH&U)H
+2µ6(3'¶EDVHGRQ7DEOHDQG&ULD )HLD íPRO/RQ>$@ +2µ6(3'¶EDVHGRQ7DEOHDQG&ULD )HLD íPRO/RQ>$@
)LJXUH 6SDOOLQJDWSLHURI)ORULGD.H\V%ULGJHV)/86$GXHWRFRUURVLRQRIWKHHSR[\FRDWHG )LJXUH 6SDOOLQJDWSLHURI)ORULGD.H\V%ULGJHV)/86$GXHWRFRUURVLRQRIWKHHSR[\FRDWHG
UHLQIRUFHPHQW)URP>&2:,F@ UHLQIRUFHPHQW)URP>&2:,F@
)LJXUH &RQFUHWHSLHUVLQWRWKH0H[LFDQ*XOIDW3URJUHVR0H[LFR)URP>5DPE¡OO@>$@ )LJXUH &RQFUHWHSLHUVLQWRWKH0H[LFDQ*XOIDW3URJUHVR0H[LFR)URP>5DPE¡OO@>$@
3HULVKHG FDUERQ VWHHO UHLQIRUFHG SLHU RSHQHG LQ   LQ WKH IRUHJURXQG DQG H[LVWLQJ 3HULVKHG FDUERQ VWHHO UHLQIRUFHG SLHU RSHQHG LQ   LQ WKH IRUHJURXQG DQG H[LVWLQJ
VWDLQOHVV VWHHO UHLQIRUFHG SLHU RSHQHG LQ   LQ WKH EDFNJURXQG >%@ &ORVH XS RI VWDLQOHVV VWHHO UHLQIRUFHG SLHU RSHQHG LQ   LQ WKH EDFNJURXQG >%@ &ORVH XS RI
UHPDLQVRIWKHGHFNRIWKHFDUERQVWHHOUHLQIRUFHGSLHU UHPDLQVRIWKHGHFNRIWKHFDUERQVWHHOUHLQIRUFHGSLHU
)LJXUH µ0(3'V¶ IRU SULQFLSDO DOOR\V RI JUDGH  >'6(1  @ >$670 )LJXUH µ0(3'V¶ IRU SULQFLSDO DOOR\V RI JUDGH  >'6(1  @ >$670
'6 @ VWDLQOHVV VWHHO LQ WKH &O+2 V\VWHP 7KH LRQ DFWLYLWLHV RI DOO LQFOXGHG '6 @ VWDLQOHVV VWHHO LQ WKH &O+2 V\VWHP 7KH LRQ DFWLYLWLHV RI DOO LQFOXGHG
PHWDOVFRUUHVSRQGWRíPRO/DQG&OLD PRO/>$@&U&O)H1L0Rµ0(3'¶>%@ PHWDOVFRUUHVSRQGWRíPRO/DQG&OLD PRO/>$@&U&O)H1L0Rµ0(3'¶>%@
1L&O)H&U0Rµ0(3'¶>&@0R&O)H&U1Lµ0(3'¶ 1L&O)H&U0Rµ0(3'¶>&@0R&O)H&U1Lµ0(3'¶
)LJXUH >$@)H&O+2µ0(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/DQG&OLD PRO/ )LJXUH >$@)H&O+2µ0(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/DQG&OLD PRO/
>%@µ6,3'¶RIVWDELOLW\GRPDLQVRIVHOHFWHGVWDLQOHVVVWHHODOOR\R[LGHVIURP)LJXUH >%@µ6,3'¶RIVWDELOLW\GRPDLQVRIVHOHFWHGVWDLQOHVVVWHHODOOR\R[LGHVIURP)LJXUH
RQ >$@ 2ZQ FRUURVLRQ SRWHQWLDO PHDVXUHPHQWV IURP µ7HVW,¶ RI SDVVLYH VWDLQOHVV VWHHO RQ >$@ 2ZQ FRUURVLRQ SRWHQWLDO PHDVXUHPHQWV IURP µ7HVW,¶ RI SDVVLYH VWDLQOHVV VWHHO
HPEHGGHGLQPRUWDU ³&$´FI6HFWLRQ DUHLQGLFDWHGE\WKHWKLFNWXUTXRLVHEDU HPEHGGHGLQPRUWDU ³&$´FI6HFWLRQ DUHLQGLFDWHGE\WKHWKLFNWXUTXRLVHEDU
DQGSXWLQWRFRQWH[WZLWKWKHFRUURVLRQSRWHQWLDOVPHDVXUHGIRUSDVVLYHFDUERQVWHHOZLWK DQGSXWLQWRFRQWH[WZLWKWKHFRUURVLRQSRWHQWLDOVPHDVXUHGIRUSDVVLYHFDUERQVWHHOZLWK
GLIIHUHQW VXUIDFH SURSHUWLHV LOOXVWUDWHG E\ WKH WKLQ FRORXUHG OLQHV FI )LJXUH  >$@ LQ GLIIHUHQW VXUIDFH SURSHUWLHV LOOXVWUDWHG E\ WKH WKLQ FRORXUHG OLQHV FI )LJXUH  >$@ LQ
6HFWLRQ   ,W VKRXOG EH QRWHG WKDW WKH XQGHUO\LQJ DUHDV RI WKH )H&O+2 µ0(3'¶ 6HFWLRQ   ,W VKRXOG EH QRWHG WKDW WKH XQGHUO\LQJ DUHDV RI WKH )H&O+2 µ0(3'¶
DUHQRWVKDGHGDVRQO\WKHSDVVLYHGRPDLQVDUHVXSHULPSRVHG DUHQRWVKDGHGDVRQO\WKHSDVVLYHGRPDLQVDUHVXSHULPSRVHG
)LJXUH /LJKWRSWLFDOPLFURVFRS\RIXQHWFKHGFURVVVHFWLRQRIVWDLQOHVVVWHHOVDPSOH>$@0LGGOH )LJXUH /LJKWRSWLFDOPLFURVFRS\RIXQHWFKHGFURVVVHFWLRQRIVWDLQOHVVVWHHOVDPSOH>$@0LGGOH
>%@(GJHRI³EXON´>&@(GJHRIULE >%@(GJHRI³EXON´>&@(GJHRIULE
)LJXUH 6HFRQGDU\HOHFWURQVFDQQLQJHOHFWURQPLFURVFRS\RIWKHHGJHRIWKHHWFKHGORQJLWXGLQDO )LJXUH 6HFRQGDU\HOHFWURQVFDQQLQJHOHFWURQPLFURVFRS\RIWKHHGJHRIWKHHWFKHGORQJLWXGLQDO
VHFWLRQRIWKHVWDLQOHVVUHEDU VHFWLRQRIWKHVWDLQOHVVUHEDU
)LJXUH >$@µ6,3'¶RI1L&O+2µ0(3'¶ZLWK1LLD íPRO/DQG&OLD PRO/RQ)H&O )LJXUH >$@µ6,3'¶RI1L&O+2µ0(3'¶ZLWK1LLD íPRO/DQG&OLD PRO/RQ)H&O
+2 µ0(3'¶ ZLWK )HLD  í PRO/ DQG &OLD  PRO/ >%@ µ6,3'¶ RI &X&O+2 +2 µ0(3'¶ ZLWK )HLD  í PRO/ DQG &OLD  PRO/ >%@ µ6,3'¶ RI &X&O+2
µ0(3'¶ZLWK&XLD íPRO/DQG&OLD PRO/RQ)H&O+2µ0(3'¶ZLWK)HLD  µ0(3'¶ZLWK&XLD íPRO/DQG&OLD PRO/RQ)H&O+2µ0(3'¶ZLWK)HLD 
íPRO/DQG&OLD PRO/ íPRO/DQG&OLD PRO/
)LJXUH &RPPHUFLDOO\ DYDLODEOH VDFULILFLDO DQRGH V\VWHP IRU SDWFK UHSDLU )URP >4LX @ )LJXUH &RPPHUFLDOO\ DYDLODEOH VDFULILFLDO DQRGH V\VWHP IRU SDWFK UHSDLU )URP >4LX @
>$@6NHWFKRIDQRGHV\VWHPSUHVHQWLQJWKHSUHSDFNDJHG]LQFVDFULILFLDODQRGHZLWKVHOI >$@6NHWFKRIDQRGHV\VWHPSUHVHQWLQJWKHSUHSDFNDJHG]LQFVDFULILFLDODQRGHZLWKVHOI
FRQWDLQHGZLUHWLHV>%@,QVWDOOHGVDFULILFLDODQRGHV\VWHP FRQWDLQHGZLUHWLHV>%@,QVWDOOHGVDFULILFLDODQRGHV\VWHP
)LJXUH >$@)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/ZLWKSURSRVHGPHFKDQLVP )LJXUH >$@)H+2µ6(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/ZLWKSURSRVHGPHFKDQLVP
IRU FDUERQDWLRQ LQGXFHG FRUURVLRQ LQ R[\JHQULFK FRQFUHWH FI )LJXUH  LQ 6HFWLRQ IRU FDUERQDWLRQ LQGXFHG FRUURVLRQ LQ R[\JHQULFK FRQFUHWH FI )LJXUH  LQ 6HFWLRQ
 >%@)H&O+2µ0(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/DQG&OLD   >%@)H&O+2µ0(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/DQG&OLD 
PRO/ ZLWK SURSRVHG PHFKDQLVP IRU FKORULGH LQGXFHG FRUURVLRQ LQ R[\JHQGHSULYHG PRO/ ZLWK SURSRVHG PHFKDQLVP IRU FKORULGH LQGXFHG FRUURVLRQ LQ R[\JHQGHSULYHG
FRQFUHWH FI)LJXUHLQ6HFWLRQ  FRQFUHWH FI)LJXUHLQ6HFWLRQ 
)LJXUH µ6,3'¶ RI )H+2 µ6(3'¶ RQ )H&O+2 µ0(3'¶ ZLWK LGHQWLILFDWLRQ RI FULWLFDO µ(FRUU¶ )LJXUH µ6,3'¶ RI )H+2 µ6(3'¶ RQ )H&O+2 µ0(3'¶ ZLWK LGHQWLILFDWLRQ RI FULWLFDO µ(FRUU¶
DQG S+ DUHD $ EOXH GRW  DV LGHQWLILHG LQ )LJXUH  DQG LOOXVWUDWLRQ RI SRWHQWLDO DQG S+ DUHD $ EOXH GRW  DV LGHQWLILHG LQ )LJXUH  DQG LOOXVWUDWLRQ RI SRWHQWLDO
WKHUPRG\QDPLFDSSURDFKHVIRUUHSDLU %&'DQG(\HOORZGRWV  WKHUPRG\QDPLFDSSURDFKHVIRUUHSDLU %&'DQG(\HOORZGRWV 
)LJXUH ([WUDFWIURPWKHSURSRVHGIORZFKDUWIRUGHVLJQRIQHZFRXQWHUPHDVXUHV FI)LJXUH )LJXUH ([WUDFWIURPWKHSURSRVHGIORZFKDUWIRUGHVLJQRIQHZFRXQWHUPHDVXUHV FI)LJXUH
6HFWLRQ LQGLFDWLQJWKHGHVLJQSKDVHVRIFRQFHUQLQWKHSUHVHQWWKHVLV 6HFWLRQ LQGLFDWLQJWKHGHVLJQSKDVHVRIFRQFHUQLQWKHSUHVHQWWKHVLV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;;9 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;;9


/LVWRI)LJXUHV /LVWRI)LJXUHV

)LJXUH ,GHQWLILFDWLRQRIµ(FRUU¶DQGS+DUHDLQDQHZVWUXFWXUH $EOXHGRW DQGRIFULWLFDOµ(FRUU¶ )LJXUH ,GHQWLILFDWLRQRIµ(FRUU¶DQGS+DUHDLQDQHZVWUXFWXUH $EOXHGRW DQGRIFULWLFDOµ(FRUU¶


DQG S+ DUHD FI )LJXUH   IRU FRUURVLRQ LQLWLDWLRQ LQ D FRQWDPLQDWHG VWUXFWXUH % DQG S+ DUHD FI )LJXUH   IRU FRUURVLRQ LQLWLDWLRQ LQ D FRQWDPLQDWHG VWUXFWXUH %
\HOORZGRW RQGLIIHUHQWµ6,3'V¶>$@µ6,3'¶RI)H+2µ6(3'¶RQ)H&O+2µ0(3'¶ \HOORZGRW RQGLIIHUHQWµ6,3'V¶>$@µ6,3'¶RI)H+2µ6(3'¶RQ)H&O+2µ0(3'¶
FI)LJXUH DQGLOOXVWUDWLRQRISRWHQWLDOWKHUPRG\QDPLFDSSURDFKHVIRUSURWHFWLRQ FI)LJXUH DQGLOOXVWUDWLRQRISRWHQWLDOWKHUPRG\QDPLFDSSURDFKHVIRUSURWHFWLRQ
&DQG'JUHHQGRWV >%@µ6,3'¶RIVWDELOLW\GRPDLQVRIVHOHFWHGVWDLQOHVVVWHHODOOR\ &DQG'JUHHQGRWV >%@µ6,3'¶RIVWDELOLW\GRPDLQVRIVHOHFWHGVWDLQOHVVVWHHODOOR\
R[LGHV FI)LJXUH RQ)H&O+2µ0(3'¶ FI)LJXUH>%@ >&@µ6,3'¶RI&X&O R[LGHV FI)LJXUH RQ)H&O+2µ0(3'¶ FI)LJXUH>%@ >&@µ6,3'¶RI&X&O
+2µ0(3'¶RQ)H&O+2µ0(3'¶ FI)LJXUH>%@  +2µ0(3'¶RQ)H&O+2µ0(3'¶ FI)LJXUH>%@ 
)LJXUH =Q+2µ6(3'V¶EDVHGRQ7DEOHZLWKGLIIHUHQW]LQFLRQDFWLYLWLHV>$@=QLD í )LJXUH =Q+2µ6(3'V¶EDVHGRQ7DEOHZLWKGLIIHUHQW]LQFLRQDFWLYLWLHV>$@=QLD í
PRO/>%@=QLD íPRO/>&@=QLD PRO/ PRO/>%@=QLD íPRO/>&@=QLD PRO/
)LJXUH >$@=Q&+2µ0(3'¶EDVHGRQ7DEOHDQG=QLD íPRO/DQG&LD PRO/ )LJXUH >$@=Q&+2µ0(3'¶EDVHGRQ7DEOHDQG=QLD íPRO/DQG&LD PRO/
>%@ =Q&O+2 µ0(3'¶ EDVHG RQ 7DEOH  DQG =QLD  í PRO/ DQG &OLD  í >%@ =Q&O+2 µ0(3'¶ EDVHG RQ 7DEOH  DQG =QLD  í PRO/ DQG &OLD  í
PRO/>&@$V>%@EXWZLWK&OLD %DVHGRQ=QLD íPRO/=Q&OLVIDYRXUHGRYHU PRO/>&@$V>%@EXWZLWK&OLD %DVHGRQ=QLD íPRO/=Q&OLVIDYRXUHGRYHU
=QLQWKHDVVRFLDWHGVWDELOLW\GRPDLQIURPDERYH&OLD PRO/ =QLQWKHDVVRFLDWHGVWDELOLW\GRPDLQIURPDERYH&OLD PRO/
)LJXUH )H=Q&O+2µ0(3'V¶EDVHGRQ7DEOHDQGGLIIHUHQWLRQDFWLYLWLHV>$@)HLD í )LJXUH )H=Q&O+2µ0(3'V¶EDVHGRQ7DEOHDQGGLIIHUHQWLRQDFWLYLWLHV>$@)HLD í
PRO/ =QLD  í PRO/ DQG &LD  í PRO/ >%@ )HLD  í PRO/ =QLD  í PRO/ =QLD  í PRO/ DQG &LD  í PRO/ >%@ )HLD  í PRO/ =QLD  í
PRO/DQG&LD íPRO/>&@)HLD PRO/=QLD PRO/DQG&LD PRO/ PRO/DQG&LD íPRO/>&@)HLD PRO/=QLD PRO/DQG&LD PRO/
)LJXUH =Q)H&O+2µ0(3'V¶EDVHGRQ7DEOHDQGGLIIHUHQWLRQDFWLYLWLHV>$@=QLD í )LJXUH =Q)H&O+2µ0(3'V¶EDVHGRQ7DEOHDQGGLIIHUHQWLRQDFWLYLWLHV>$@=QLD í
PRO/ )HLD  í PRO/ DQG &LD  í PRO/ >%@ =QLD  í PRO/ )HLD  í PRO/ )HLD  í PRO/ DQG &LD  í PRO/ >%@ =QLD  í PRO/ )HLD  í
PRO/DQG&LD íPRO/>&@=QLD PRO/)HLD PRO/DQG&LD PRO/ PRO/DQG&LD íPRO/>&@=QLD PRO/)HLD PRO/DQG&LD PRO/
)LJXUH >$@µ6,3'¶RI=Q)H&O+2µ0(3'¶EDVHGRQ7DEOHZLWK=QLD PRO/)HLD  )LJXUH >$@µ6,3'¶RI=Q)H&O+2µ0(3'¶EDVHGRQ7DEOHZLWK=QLD PRO/)HLD 
PRO/DQG&OLD  PRO/RQ)H&O+2µ0(3'¶EDVHGRQ7DEOHDQG)HLD í PRO/DQG&OLD  PRO/RQ)H&O+2µ0(3'¶EDVHGRQ7DEOHDQG)HLD í
PRO/DQG&OLD PRO/>%@=Q)H&O+2µ0(3'¶EDVHGRQ7DEOHZLWK=QLD  PRO/DQG&OLD PRO/>%@=Q)H&O+2µ0(3'¶EDVHGRQ7DEOHZLWK=QLD 
í PRO/ )HLD  í PRO/ DQG &OLD   PRO/ >&@ $V >$@ EXW ZLWK =QLD  í í PRO/ )HLD  í PRO/ DQG &OLD   PRO/ >&@ $V >$@ EXW ZLWK =QLD  í
PRO/DQG)HLD íPRO/IRUWKHVXSHULPSRVHG=Q)H&O+2µ0(3'¶ PRO/DQG)HLD íPRO/IRUWKHVXSHULPSRVHG=Q)H&O+2µ0(3'¶
)LJXUH 0J+2µ6(3'V¶EDVHGRQ7DEOHZLWKGLIIHUHQWPDJQHVLXPLRQDFWLYLWLHV>$@0JLD )LJXUH 0J+2µ6(3'V¶EDVHGRQ7DEOHZLWKGLIIHUHQWPDJQHVLXPLRQDFWLYLWLHV>$@0JLD
íPRO/>%@0JLD íPRO/>&@0JLD PRO/ íPRO/>%@0JLD íPRO/>&@0JLD PRO/
)LJXUH >$@0J&O+2µ0(3'¶EDVHGRQ7DEOHZLWK0JLD íPRO/DQG&OLD PRO/ )LJXUH >$@0J&O+2µ0(3'¶EDVHGRQ7DEOHZLWK0JLD íPRO/DQG&OLD PRO/
>%@µ6,3'¶RI>$@RQ)H&O+2µ0(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/DQG >%@µ6,3'¶RI>$@RQ)H&O+2µ0(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/DQG
&OLD   PRO/ 0J&O GRPDLQ LV WUDQVSDUHQW LOOXVWUDWLQJ WKHRUHWLFDO FRQGLWLRQV RI &OLD   PRO/ 0J&O GRPDLQ LV WUDQVSDUHQW LOOXVWUDWLQJ WKHRUHWLFDO FRQGLWLRQV RI
FDWKRGLF SURWHFWLRQ ZLWK SURWHFWLYH 0J 2+  >&@ $V >%@ EXW 0J&O DQG 0J 2+  FDWKRGLF SURWHFWLRQ ZLWK SURWHFWLYH 0J 2+  >&@ $V >%@ EXW 0J&O DQG 0J 2+ 
GRPDLQV DUH WUDQVSDUHQW LOOXVWUDWLQJ WKHRUHWLFDO FRQGLWLRQV RI FDWKRGLF SURWHFWLRQ ZLWK GRPDLQV DUH WUDQVSDUHQW LOOXVWUDWLQJ WKHRUHWLFDO FRQGLWLRQV RI FDWKRGLF SURWHFWLRQ ZLWK
QRQSURWHFWLYH0J 2+  QRQSURWHFWLYH0J 2+ 
)LJXUH 6HOHFWHGH[SHULPHQWVFRQFHUQLQJWKHLQWHUIHUHQFHRIFDOFLXPFDUERQDWHZLWKIRUPDWLRQRI )LJXUH 6HOHFWHGH[SHULPHQWVFRQFHUQLQJWKHLQWHUIHUHQFHRIFDOFLXPFDUERQDWHZLWKIRUPDWLRQRI
PDJQHVLXPK\GUR[LGH>$@5HEDUVDPSOHSUHSDUHGLQFRUUHVSRQGHQFHZLWKFHPHQWSDVWH PDJQHVLXPK\GUR[LGH>$@5HEDUVDPSOHSUHSDUHGLQFRUUHVSRQGHQFHZLWKFHPHQWSDVWH
VSHFLPHQV FI 6HFWLRQ   DQG PDJQHVLXP ZLUH >(7  (7 @ KDPPHUHG LQ VSHFLPHQV FI 6HFWLRQ   DQG PDJQHVLXP ZLUH >(7  (7 @ KDPPHUHG LQ
JURYHVEHIRUHJULWEODVWLQJ>%@5HEDUVDPSOHFRUUHVSRQGLQJWR>$@DIWHUGLSFRDWLQJLQ JURYHVEHIRUHJULWEODVWLQJ>%@5HEDUVDPSOHFRUUHVSRQGLQJWR>$@DIWHUGLSFRDWLQJLQ
FHPHQWSDVWH FI6HFWLRQDQG6HFWLRQ >&@5HEDUVDPSOHFRUUHVSRQGLQJWR FHPHQWSDVWH FI6HFWLRQDQG6HFWLRQ >&@5HEDUVDPSOHFRUUHVSRQGLQJWR
>$@ VXEPHUVHG LQ VDWXUDWHG FDOFLXP K\GUR[LGH VROXWLRQ DQG FRQQHFWHG WR DGGLWLRQDO >$@ VXEPHUVHG LQ VDWXUDWHG FDOFLXP K\GUR[LGH VROXWLRQ DQG FRQQHFWHG WR DGGLWLRQDO
PDJQHVLXPZLUHVDPSOH PDJQHVLXPZLUHVDPSOH
)LJXUH 3URSRVHG PHFKDQLVP IRU WKH LQWHUIHUHQFH RI FDOFLXP FDUERQDWH DQG WKH IRUPDWLRQ RI )LJXUH 3URSRVHG PHFKDQLVP IRU WKH LQWHUIHUHQFH RI FDOFLXP FDUERQDWH DQG WKH IRUPDWLRQ RI
PDJQHVLXPK\GUR[LGH>$@&D0J&+2µ0(3'¶EDVHGRQ7DEOHZLWK&DLD í PDJQHVLXPK\GUR[LGH>$@&D0J&+2µ0(3'¶EDVHGRQ7DEOHZLWK&DLD í
PRO/ 0JLD  í PRO/ DQG &LD  í PRO/ >%@ 0J&D&+2 µ0(3'¶ ZLWK PRO/ 0JLD  í PRO/ DQG &LD  í PRO/ >%@ 0J&D&+2 µ0(3'¶ ZLWK
SUHVHOHFWLRQ DQG 0JLD &DLD DQG &LD DV LQ >$@ >&@ WR >(@ 6NHWFKHV RI WKH SURSRVHG SUHVHOHFWLRQ DQG 0JLD &DLD DQG &LD DV LQ >$@ >&@ WR >(@ 6NHWFKHV RI WKH SURSRVHG
PHFKDQLVP IRU WKH LQIHUHQFH RI FDOFLXP FDUERQDWH DQG WKH IRUPDWLRQ RI PDJQHVLXP PHFKDQLVP IRU WKH LQIHUHQFH RI FDOFLXP FDUERQDWH DQG WKH IRUPDWLRQ RI PDJQHVLXP
K\GUR[LGH K\GUR[LGH
)LJXUH 6FDQQLQJ HOHFWURQ PLFURVFRS\ RI JULWEODVWHG PDJQHVLXP ZLUH DIWHU VXEPHUVLRQ LQ )LJXUH 6FDQQLQJ HOHFWURQ PLFURVFRS\ RI JULWEODVWHG PDJQHVLXP ZLUH DIWHU VXEPHUVLRQ LQ
VDWXUDWHGFDOFLXPK\GUR[LGHVROXWLRQ>$@6HFRQGDU\HOHFWURQ>%@%DFNVFDWWHUHG VDWXUDWHGFDOFLXPK\GUR[LGHVROXWLRQ>$@6HFRQGDU\HOHFWURQ>%@%DFNVFDWWHUHG
)LJXUH 0DSSLQJRIHOHPHQWVEDVHGRQHQHUJ\GLVSHUVLYHVSHFWURVFRS\RIDUHDVKRZQLQ)LJXUH )LJXUH 0DSSLQJRIHOHPHQWVEDVHGRQHQHUJ\GLVSHUVLYHVSHFWURVFRS\RIDUHDVKRZQLQ)LJXUH
>$@&DUERQ>%@&DOFLXP>&@0DJQHVLXP>'@2[\JHQ >$@&DUERQ>%@&DOFLXP>&@0DJQHVLXP>'@2[\JHQ
)LJXUH (QHUJ\ GLVSHUVLYH VSHFWUD IRU WKH LQYHVWLJDWHG DUHD DQG HOHPHQWV RI )LJXUH  )LJXUH (QHUJ\ GLVSHUVLYH VSHFWUD IRU WKH LQYHVWLJDWHG DUHD DQG HOHPHQWV RI )LJXUH 
VSHFLI\LQJWKHDVVRFLDWHG;UD\HQHUJLHVRQWKH;D[LVDQGWKHUHODWLYH;UD\FRXQWVRQ VSHFLI\LQJWKHDVVRFLDWHG;UD\HQHUJLHVRQWKH;D[LVDQGWKHUHODWLYH;UD\FRXQWVRQ
WKH<D[LV WKH<D[LV

;;9, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;;9, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 /LVWRI)LJXUHV  /LVWRI)LJXUHV

)LJXUH >$@µ6,3'¶RI0J&O+2µ0(3'¶EDVHGRQ7DEOHZLWK0JLD íPRO/DQG&OLD )LJXUH >$@µ6,3'¶RI0J&O+2µ0(3'¶EDVHGRQ7DEOHZLWK0JLD íPRO/DQG&OLD


PRO/RQ=Q&O+2µ0(3'¶EDVHGRQ7DEOHZLWK=QLD íPRO/DQG&OLD  PRO/RQ=Q&O+2µ0(3'¶EDVHGRQ7DEOHZLWK=QLD íPRO/DQG&OLD 
 PRO/ >%@ $V >$@ EXW ZLWK =QLD   PRO/ >&@ $V >%@ EXW 0J&O+2 µ0(3'¶  PRO/ >%@ $V >$@ EXW ZLWK =QLD   PRO/ >&@ $V >%@ EXW 0J&O+2 µ0(3'¶
UHSODFHGE\0J&D&+2µ0(3'¶EDVHGRQ7DEOHZLWK&DLD íPRO/0JLD  UHSODFHGE\0J&D&+2µ0(3'¶EDVHGRQ7DEOHZLWK&DLD íPRO/0JLD 
íPRO/DQG&LD íPRO/ íPRO/DQG&LD íPRO/
)LJXUH >$@µ6,3'¶RI0J&O+2µ0(3'¶EDVHGRQ7DEOHZLWK0JLD íPRO/DQG&OLD )LJXUH >$@µ6,3'¶RI0J&O+2µ0(3'¶EDVHGRQ7DEOHZLWK0JLD íPRO/DQG&OLD
PRO/RQ=Q)H&O+2µ0(3'¶EDVHGRQ7DEOHZLWK=QLD íPRO/)HLD  PRO/RQ=Q)H&O+2µ0(3'¶EDVHGRQ7DEOHZLWK=QLD íPRO/)HLD 
íPRO/DQG&OLD PRO/RQ)H&O+2µ0(3'¶EDVHGRQ7DEOHDQG)HLD  íPRO/DQG&OLD PRO/RQ)H&O+2µ0(3'¶EDVHGRQ7DEOHDQG)HLD 
íPRO/DQG&OLD PRO/>%@$V>$@EXW=Q)H&O+2µ0(3'¶ZLWK=QLD í íPRO/DQG&OLD PRO/>%@$V>$@EXW=Q)H&O+2µ0(3'¶ZLWK=QLD í
PRO/>&@$V>%@EXW0J&O+2µ0(3'¶UHSODFHGE\0J&D&+2µ0(3'¶EDVHG PRO/>&@$V>%@EXW0J&O+2µ0(3'¶UHSODFHGE\0J&D&+2µ0(3'¶EDVHG
RQ7DEOHZLWK&DLD íPRO/0JLD íPRO/DQG&LD íPRO/ RQ7DEOHZLWK&DLD íPRO/0JLD íPRO/DQG&LD íPRO/
)LJXUH >$@0HDVXUHGPDJQLWXGHVRIµ(FRUU¶RIDFWLYDWHG7LLQOLTXLGVROXWLRQV UHWGRWVDQGUHG )LJXUH >$@0HDVXUHGPDJQLWXGHVRIµ(FRUU¶RIDFWLYDWHG7LLQOLTXLGVROXWLRQV UHWGRWVDQGUHG
OLQH DQGLQFRQFUHWHZLWKRXWSR]]RODQLFDGGLWLRQV EOXHER[ DIWHU>&DVWURHWDO@ OLQH DQGLQFRQFUHWHZLWKRXWSR]]RODQLFDGGLWLRQV EOXHER[ DIWHU>&DVWURHWDO@
0HDVXUHGPDJQLWXGHVRIµ(FRUU¶VXSHULPSRVHGRQ,U+2µ6(3'¶DQGµ(FRUU¶UDQJHLQWKH 0HDVXUHGPDJQLWXGHVRIµ(FRUU¶VXSHULPSRVHGRQ,U+2µ6(3'¶DQGµ(FRUU¶UDQJHLQWKH
DSSOLHGPRUWDU \HOORZOLQHV DQGH[SRVXUHVROXWLRQV JUHHQOLQHV >%@µ(FRUU¶UDQJHRI DSSOLHGPRUWDU \HOORZOLQHV DQGH[SRVXUHVROXWLRQV JUHHQOLQHV >%@µ(FRUU¶UDQJHRI
DFWLYDWHG7LLQWKHDSSOLHGH[SRVXUHVROXWLRQV JUHHQOLQHV VXSHULPSRVHGRQ)H&O+2 DFWLYDWHG7LLQWKHDSSOLHGH[SRVXUHVROXWLRQV JUHHQOLQHV VXSHULPSRVHGRQ)H&O+2
µ0(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/DQG&OLD PRO/ µ0(3'¶EDVHGRQ7DEOHDQG)HLD íPRO/DQG&OLD PRO/
)LJXUH >$@ 0HDVXUHG µ(FRUU¶ GHYHORSPHQW RI HPEHGGHG HOHFWURGH ZLUHV µ((:V¶ RI WKH )LJXUH >$@ 0HDVXUHG µ(FRUU¶ GHYHORSPHQW RI HPEHGGHG HOHFWURGH ZLUHV µ((:V¶ RI WKH
LQVWUXPHQWHG PRUWDU VSHFLPHQ FI 6HFWLRQ   LH VSHFLPHQ &15 FI 6HFWLRQ LQVWUXPHQWHG PRUWDU VSHFLPHQ FI 6HFWLRQ   LH VSHFLPHQ &15 FI 6HFWLRQ
  DQG RI DFWLYDWHG 7L LQ H[SRVXUH VROXWLRQ EDVHG RQ H[WHUQDO FDWKRGH µ(&DW¶ FI   DQG RI DFWLYDWHG 7L LQ H[SRVXUH VROXWLRQ EDVHG RQ H[WHUQDO FDWKRGH µ(&DW¶ FI
6HFWLRQ   LQ  µZZ¶ FKORULGH VROXWLRQ ZLWK D S+ RI  >%@ 0HDVXUHG µ(FRUU¶ 6HFWLRQ   LQ  µZZ¶ FKORULGH VROXWLRQ ZLWK D S+ RI  >%@ 0HDVXUHG µ(FRUU¶
GHYHORSPHQW RI DFWLYDWHG 7L ZLUH VDPH DV µ((:¶ PDWHULDO  LQ 1D2+ VROXWLRQ ZLWK GHYHORSPHQW RI DFWLYDWHG 7L ZLUH VDPH DV µ((:¶ PDWHULDO  LQ 1D2+ VROXWLRQ ZLWK
QDWXUDOR[\JHQFRQWHQWDQGGHDHUDWLRQE\1EXEEOLQJ,WVKRXOGEHHPSKDVLVHGWKDW>$@ QDWXUDOR[\JHQFRQWHQWDQGGHDHUDWLRQE\1EXEEOLQJ,WVKRXOGEHHPSKDVLVHGWKDW>$@
LVEDVHGRQDH[SRVXUHGXUDWLRQLQGD\VZKHUHDVDV>%@LVEDVHGRQKRXUV LVEDVHGRQDH[SRVXUHGXUDWLRQLQGD\VZKHUHDVDV>%@LVEDVHGRQKRXUV
)LJXUH ,GHDOLVHGLQVWUXPHQWHGPRUWDUVSHFLPHQ'LPHQVLRQVLQ>PP@>$@/RQJLWXGLQDOVHFWLRQ )LJXUH ,GHDOLVHGLQVWUXPHQWHGPRUWDUVSHFLPHQ'LPHQVLRQVLQ>PP@>$@/RQJLWXGLQDOVHFWLRQ
µ77¶  WKL[RWURSLF DQG µ/9¶  ORZ YLVFRVLW\ HSR[\ >%@ 7RS YLHZ >&@ &URVVVHFWLRQ µ77¶  WKL[RWURSLF DQG µ/9¶  ORZ YLVFRVLW\ HSR[\ >%@ 7RS YLHZ >&@ &URVVVHFWLRQ
ZLWK LGHQWLILFDWLRQ RI µ(,6¶ HOHFWURGHV µ:(¶ ZRUNLQJ HOHFWURGH µ5(¶ UHIHUHQFH ZLWK LGHQWLILFDWLRQ RI µ(,6¶ HOHFWURGHV µ:(¶ ZRUNLQJ HOHFWURGH µ5(¶ UHIHUHQFH
HOHFWURGHDQGµ&(¶FRXQWHUHOHFWURGH HOHFWURGHDQGµ&(¶FRXQWHUHOHFWURGH
)LJXUH 0DQXIDFWXUH RI WKH LQVWUXPHQWHG PRUWDU VSHFLPHQV EDVHG RQ VSHFLPHQV XVHG IRU )LJXUH 0DQXIDFWXUH RI WKH LQVWUXPHQWHG PRUWDU VSHFLPHQV EDVHG RQ VSHFLPHQV XVHG IRU
FRQFOXGLQJ WHVWV FRQFHUQLQJ WKHUPRG\QDPLF SURSHUWLHV RI GLIIHUHQW VWHHO TXDOLWLHV DQG FRQFOXGLQJ WHVWV FRQFHUQLQJ WKHUPRG\QDPLF SURSHUWLHV RI GLIIHUHQW VWHHO TXDOLWLHV DQG
FDUERQ VWHHO VXUIDFH WUHDWPHQWV FI 6HFWLRQ   >$@ &RPSRQHQWV RI PRXOGV ZLWK WRS FDUERQ VWHHO VXUIDFH WUHDWPHQWV FI 6HFWLRQ   >$@ &RPSRQHQWV RI PRXOGV ZLWK WRS
DQGERWWRPOLGIRUSRVLWLRQLQJRIUHEDUDQGHPEHGGHGHOHFWURGHZLUHVDQGDFU\OLFJODVV DQGERWWRPOLGIRUSRVLWLRQLQJRIUHEDUDQGHPEHGGHGHOHFWURGHZLUHVDQGDFU\OLFJODVV
VHFWLRQV >%@ %DWFK RI PRXOG SUHSDUHG IRU FDVWLQJ DQG UHEDUV ZLWK GLIIHUHQW VXUIDFH VHFWLRQV >%@ %DWFK RI PRXOG SUHSDUHG IRU FDVWLQJ DQG UHEDUV ZLWK GLIIHUHQW VXUIDFH
WUHDWPHQWV WUHDWPHQWV
)LJXUH >$@ 5HEDUV ZLWK ILUVW OD\HU RI WKL[RWURSLF HSR[\ GLSFRDWLQJ >%@ +DUGHQLQJ RI )LJXUH >$@ 5HEDUV ZLWK ILUVW OD\HU RI WKL[RWURSLF HSR[\ GLSFRDWLQJ >%@ +DUGHQLQJ RI
VSHFLPHQVDIWHUFHPHQWSDVWHGLSFRDWLQJRQDVSLQQLQJZKHHOWRDFKLHYHDKRPRJHQRXV VSHFLPHQVDIWHUFHPHQWSDVWHGLSFRDWLQJRQDVSLQQLQJZKHHOWRDFKLHYHDKRPRJHQRXV
WKLFNQHVV RI WKH FHPHQW SDVWH OD\HU >&@ &XULQJ RI VSHFLPHQV LQ VDWXUDWHG &D 2+  WKLFNQHVV RI WKH FHPHQW SDVWH OD\HU >&@ &XULQJ RI VSHFLPHQV LQ VDWXUDWHG &D 2+ 
VROXWLRQDIWHUKDUGHQLQJRQVSLQQLQJZKHHO VROXWLRQDIWHUKDUGHQLQJRQVSLQQLQJZKHHO
)LJXUH ([WHUQDO FDWKRGH >$@ 3KRWRJUDSK >%@ ,GHDOLVHG ORQJLWXGLQDO VHFWLRQ 'LPHQVLRQV LQ )LJXUH ([WHUQDO FDWKRGH >$@ 3KRWRJUDSK >%@ ,GHDOLVHG ORQJLWXGLQDO VHFWLRQ 'LPHQVLRQV LQ
>PP@ >PP@
)LJXUH >$@([SRVXUHVHWXSRQWZROHYHOFDUWVZLWKWKHDFU\OLFJODVVH[SRVXUHFRQWDLQHUVRQWKH )LJXUH >$@([SRVXUHVHWXSRQWZROHYHOFDUWVZLWKWKHDFU\OLFJODVVH[SRVXUHFRQWDLQHUVRQWKH
WRS VKHOI WKH UHVHUYRLU FRQWDLQHUV RQ WKH ERWWRP VKHOI DQG WKH DLU SXPS LQ IURQW >%@ WRS VKHOI WKH UHVHUYRLU FRQWDLQHUV RQ WKH ERWWRP VKHOI DQG WKH DLU SXPS LQ IURQW >%@
,GHDOLVHGWRSYLHZRIWKHIXOO\HTXLSSHGVPDOOH[SRVXUHFRQWDLQHU'LPHQVLRQVLQ>PP@ ,GHDOLVHGWRSYLHZRIWKHIXOO\HTXLSSHGVPDOOH[SRVXUHFRQWDLQHU'LPHQVLRQVLQ>PP@
 
)LJXUH 0RQLWRULQJ RI WKUHH VLJQDOV $ WR &  IURP HDFK RI VL[ VSHFLPHQV  WR   DJDLQVW WKUHH )LJXUH 0RQLWRULQJ RI WKUHH VLJQDOV $ WR &  IURP HDFK RI VL[ VSHFLPHQV  WR   DJDLQVW WKUHH
UHIHUHQFHVLJQDOV 5HWR5H E\FRQYHQWLRQDOGDWDORJJLQJ UHIHUHQFHVLJQDOV 5HWR5H E\FRQYHQWLRQDOGDWDORJJLQJ
)LJXUH 0RQLWRULQJ RI WKUHH VLJQDOV $ WR &  IURP HDFK RI VL[ VSHFLPHQV  WR   DJDLQVW WKUHH )LJXUH 0RQLWRULQJ RI WKUHH VLJQDOV $ WR &  IURP HDFK RI VL[ VSHFLPHQV  WR   DJDLQVW WKUHH
UHIHUHQFHVLJQDOV 5HWR5H E\GDWDORJJLQJEDVHGRQFOXVWHUPHDVXUHPHQWV UHIHUHQFHVLJQDOV 5HWR5H E\GDWDORJJLQJEDVHGRQFOXVWHUPHDVXUHPHQWV

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;;9,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;;9,,


/LVWRI)LJXUHV /LVWRI)LJXUHV

)LJXUH 6ZLWFK FDUG FRUUHVSRQGLQJ WR RQH PHDVXUHPHQW FOXVWHU >$@ DQG >%@ &RQQHFWLRQV IRU )LJXUH 6ZLWFK FDUG FRUUHVSRQGLQJ WR RQH PHDVXUHPHQW FOXVWHU >$@ DQG >%@ &RQQHFWLRQV IRU
WZR LQVWUXPHQWHG PRUWDU VSHFLPHQV ZLWK H[WHUQDO FDWKRGH µ(&DW¶ µLPDF¶ PDFURFHOO WZR LQVWUXPHQWHG PRUWDU VSHFLPHQV ZLWK H[WHUQDO FDWKRGH µ(&DW¶ µLPDF¶ PDFURFHOO
FXUUHQW DQG µ(FRUU¶ FRUURVLRQ SRWHQWLDO 7KH FRORXU FRGH XVHG IRU WKH FRQGXFWRUV FXUUHQW DQG µ(FRUU¶ FRUURVLRQ SRWHQWLDO 7KH FRORXU FRGH XVHG IRU WKH FRQGXFWRUV
FRUUHVSRQGV WR WKH FRORXUV XVHG LQ WKH VFKHPH IRU WKH FRQQHFWLRQV HVWDEOLVKHG RQ WKH FRUUHVSRQGV WR WKH FRORXUV XVHG LQ WKH VFKHPH IRU WKH FRQQHFWLRQV HVWDEOLVKHG RQ WKH
GLVWULEXWLRQ WHUPLQDO ERDUG FI 7DEOH  LQ 6HFWLRQ   >&@ 3LQV RI WZR SROH GLVWULEXWLRQ WHUPLQDO ERDUG FI 7DEOH  LQ 6HFWLRQ   >&@ 3LQV RI WZR SROH
FKDQJHRYHU UHOD\ DQG DVVRFLDWHG FLUFXLW GLDJUDP >'@ 6WDQGDUG SLQ SOXJ IRU FKDQJHRYHU UHOD\ DQG DVVRFLDWHG FLUFXLW GLDJUDP >'@ 6WDQGDUG SLQ SOXJ IRU
HOHFWURFKHPLFDO LPSHGDQFH VSHFWURVFRS\ µ(,6¶ SRODULVDWLRQ FXUYHV DQG RWKHU HOHFWURFKHPLFDO LPSHGDQFH VSHFWURVFRS\ µ(,6¶ SRODULVDWLRQ FXUYHV DQG RWKHU
VXSSOHPHQWDU\ HOHFWURFKHPLFDO PHDVXUHPHQWV FI 6HFWLRQ   7KH FRORXU FRGH RI WKH VXSSOHPHQWDU\ HOHFWURFKHPLFDO PHDVXUHPHQWV FI 6HFWLRQ   7KH FRORXU FRGH RI WKH
SLQV  FRUUHVSRQGVWRWKHFRORXUVRIWKHFRQGXFWRUVDQGWRWKHFRORXUVXVHGIRUWKH SLQV  FRUUHVSRQGVWRWKHFRORXUVRIWKHFRQGXFWRUVDQGWRWKHFRORXUVXVHGIRUWKH
FRQQHFWLRQV RQ WKH DGDSWHU WHUPLQDO ERDUG FXVWRPLVHG IRU FRQQHFWLRQ WR WKH DSSOLHG FRQQHFWLRQV RQ WKH DGDSWHU WHUPLQDO ERDUG FXVWRPLVHG IRU FRQQHFWLRQ WR WKH DSSOLHG
µ(,6¶HTXLSPHQW FI)LJXUHLQ6HFWLRQ  µ(,6¶HTXLSPHQW FI)LJXUHLQ6HFWLRQ 
)LJXUH $GDSWHU WHUPLQDO ERDUG FXVWRPLVHG IRU FRQQHFWLRQ WR WKH DSSOLHG HOHFWURFKHPLFDO )LJXUH $GDSWHU WHUPLQDO ERDUG FXVWRPLVHG IRU FRQQHFWLRQ WR WKH DSSOLHG HOHFWURFKHPLFDO
LPSHGDQFH VSHFWURVFRS\ µ(,6¶ HTXLSPHQW µ(&DW¶ H[WHUQDO FDWKRGH µ((:¶ HPEHGGHG LPSHGDQFH VSHFWURVFRS\ µ(,6¶ HTXLSPHQW µ(&DW¶ H[WHUQDO FDWKRGH µ((:¶ HPEHGGHG
HOHFWURGH ZLUH µ:(¶ ZRUNLQJ HOHFWURGH µ5(¶ UHIHUHQFH HOHFWURGH µ&(¶ FRXQWHU HOHFWURGH ZLUH µ:(¶ ZRUNLQJ HOHFWURGH µ5(¶ UHIHUHQFH HOHFWURGH µ&(¶ FRXQWHU
HOHFWURGH µ&6¶ FRXQWHUVHQVHDQG µ&*¶ FKDVVLVJURXQG7KHOD\RXWRIWKHDGDSWHU HOHFWURGH µ&6¶ FRXQWHUVHQVHDQG µ&*¶ FKDVVLVJURXQG7KHOD\RXWRIWKHDGDSWHU
WHUPLQDO ERDUG FRUUHVSRQG WR FRQQHFWLRQ WR D *DPU\ &06  HOHFWURFKHPLFDO WHUPLQDO ERDUG FRUUHVSRQG WR FRQQHFWLRQ WR D *DPU\ &06  HOHFWURFKHPLFDO
PHDVXUHPHQW V\VWHP >*DPU\ @ 7KH FRORXU FRGH RI WKH VSHFLPHQ FRQQHFWLRQ SLQV PHDVXUHPHQW V\VWHP >*DPU\ @ 7KH FRORXU FRGH RI WKH VSHFLPHQ FRQQHFWLRQ SLQV
FRUUHVSRQGV WR WKH FRORXUV XVHG IRU WKH FRQGXFWRUV FRQQHFWHG WR WKH VZLWFK FDUG FI FRUUHVSRQGV WR WKH FRORXUV XVHG IRU WKH FRQGXFWRUV FRQQHFWHG WR WKH VZLWFK FDUG FI
)LJXUHLQ6HFWLRQ  )LJXUHLQ6HFWLRQ 
)LJXUH >$@ 7KUHHSRLQW HOHFWURGH VHWXS IRU GHVWUXFWLYH HOHFWURFKHPLFDO WHVWLQJ 'XULQJ WHVWLQJ )LJXUH >$@ 7KUHHSRLQW HOHFWURGH VHWXS IRU GHVWUXFWLYH HOHFWURFKHPLFDO WHVWLQJ 'XULQJ WHVWLQJ
RI JULWEODVWHG FHPHQW SDVWH VSHFLPHQ VSHFLPHQ ³&*´ FI 6HFWLRQ   >%@ $V RI JULWEODVWHG FHPHQW SDVWH VSHFLPHQ VSHFLPHQ ³&*´ FI 6HFWLRQ   >%@ $V
>$@ EXW DIWHU WHVWLQJ RI JULWEODVWHG FHPHQW SDVWH VSHFLPHQ ZLWK PDMRU SUHFLSLWDWLRQ RI >$@ EXW DIWHU WHVWLQJ RI JULWEODVWHG FHPHQW SDVWH VSHFLPHQ ZLWK PDMRU SUHFLSLWDWLRQ RI
EODFN UXVW >&@ *ULWEODVWHG FHPHQW SDVWH VSHFLPHQ DIWHU WHVWLQJ ZLWK VHYHUH FUDFNLQJ EODFN UXVW >&@ *ULWEODVWHG FHPHQW SDVWH VSHFLPHQ DIWHU WHVWLQJ ZLWK VHYHUH FUDFNLQJ
DQGGHSRVLWLRQRIUHGJUHHQEODFNUXVW>'@6WDLQOHVVFHPHQWSDVWHVSHFLPHQ VSHFLPHQ DQGGHSRVLWLRQRIUHGJUHHQEODFNUXVW>'@6WDLQOHVVFHPHQWSDVWHVSHFLPHQ VSHFLPHQ
³&-´FI6HFWLRQ DIWHUWHVWLQJDQGUHPRYDORIWKHFHPHQWOD\HUWRLQYHVWLJDWH ³&-´FI6HFWLRQ DIWHUWHVWLQJDQGUHPRYDORIWKHFHPHQWOD\HUWRLQYHVWLJDWH
WKHSK\VLFDODSSHDUDQFHRIWKHFRUURVLRQGDPDJHVKRZLQJVHYHUHSLWWLQJGDPDJH WKHSK\VLFDODSSHDUDQFHRIWKHFRUURVLRQGDPDJHVKRZLQJVHYHUHSLWWLQJGDPDJH
 
 

;;9,,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;;9,,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 

/LVWRI7DEOHV /LVWRI7DEOHV
7DEOH ,QGLFHVVXUIDFHPRGLILFDWLRQSXUSRVHDQGDPRXQWRIVSHFLPHQVWHVWHGLQWKHH[SRVXUH 7DEOH ,QGLFHVVXUIDFHPRGLILFDWLRQSXUSRVHDQGDPRXQWRIVSHFLPHQVWHVWHGLQWKHH[SRVXUH
FRQWDLQHUV FI6HFWLRQ GXULQJWKHFRQFOXGLQJH[SHULPHQWVIRUWKHLQYHVWLJDWLRQVRQ FRQWDLQHUV FI6HFWLRQ GXULQJWKHFRQFOXGLQJH[SHULPHQWVIRUWKHLQYHVWLJDWLRQVRQ
VWHHOTXDOLWLHVDQGVXUIDFHPRGLILFDWLRQV VWHHOTXDOLWLHVDQGVXUIDFHPRGLILFDWLRQV
7DEOH 6WDQGDUG*LEEVIUHHHQHUJ\RIIRUPDWLRQFKDQJHµ¨*I¶DQGVWDQGDUG*LEEVIUHHHQHUJ\ 7DEOH 6WDQGDUG*LEEVIUHHHQHUJ\RIIRUPDWLRQFKDQJHµ¨*I¶DQGVWDQGDUG*LEEVIUHHHQHUJ\
RIIRUPDWLRQµ*I¶YDOXHVIRUFRPSRXQGVLQYROYHGLQDFLGEDVHUHDFWLRQ>@ RIIRUPDWLRQµ*I¶YDOXHVIRUFRPSRXQGVLQYROYHGLQDFLGEDVHUHDFWLRQ>@
7DEOH 6SHFLHVSUHVHOHFWHGIRUWKH3RXUEDL[GLDJUDPRIWKHJHQHUDO)H+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKH3RXUEDL[GLDJUDPRIWKHJHQHUDO)H+2V\VWHP
7DEOH +DOIFHOO UHDFWLRQV DVVRFLDWHG HTXLOLEULXP SRWHQWLDOV DQG UHDFWLRQ GLUHFWLRQV 7DEOH +DOIFHOO UHDFWLRQV DVVRFLDWHG HTXLOLEULXP SRWHQWLDOV DQG UHDFWLRQ GLUHFWLRQV
UHGXFWLRQDVZULWWHQR[LGDWLRQ EROG UHYHUVHG FRUUHVSRQGLQJWRWKHHVVHQWLDOUHJLRQV UHGXFWLRQDVZULWWHQR[LGDWLRQ EROG UHYHUVHG FRUUHVSRQGLQJWRWKHHVVHQWLDOUHJLRQV
LGHQWLILHGLQWKH3RXUEDL[GLDJUDPDQGWKHSRODULVDWLRQFXUYHVIRUWKHVHOHFWHGS+RI LGHQWLILHGLQWKH3RXUEDL[GLDJUDPDQGWKHSRODULVDWLRQFXUYHVIRUWKHVHOHFWHGS+RI
E\WKH\HOORZFLUFOHVLQ)LJXUH E\WKH\HOORZFLUFOHVLQ)LJXUH
7DEOH &KHPLFDO DQDO\VLV RI UDSLG KDUGHQLQJ 3RUWODQG FHPHQW &(0 ,  )URP $3   7DEOH &KHPLFDO DQDO\VLV RI UDSLG KDUGHQLQJ 3RUWODQG FHPHQW &(0 ,  )URP $3  
7KLVFHPHQWW\SHZDVXVHGDVWKHVWDQGDUGFHPHQWLQDOOH[SHULPHQWDOLQYHVWLJDWLRQV FI 7KLVFHPHQWW\SHZDVXVHGDVWKHVWDQGDUGFHPHQWLQDOOH[SHULPHQWDOLQYHVWLJDWLRQV FI
6HFWLRQ  6HFWLRQ 
7DEOH ,RQLF FRQFHQWUDWLRQ PHDVXUHG LQ WKH SRUH VROXWLRQ H[WUDFWHG IURP FHPHQW SDVWHV DQG 7DEOH ,RQLF FRQFHQWUDWLRQ PHDVXUHG LQ WKH SRUH VROXWLRQ H[WUDFWHG IURP FHPHQW SDVWHV DQG
PRUWDUV PDGH ZLWK 3RUWODQG FHPHQW $IWHU >%HUWROLQL HWDO @ &2 UHSUHVHQWV PRUWDUV PDGH ZLWK 3RUWODQG FHPHQW $IWHU >%HUWROLQL HWDO @ &2 UHSUHVHQWV
FDUERQDWLRQDQG1D&OVWDQGVIRUVRGLXPFKORULGHDGGHGWRWKHPL[ FDUERQDWLRQDQG1D&OVWDQGVIRUVRGLXPFKORULGHDGGHGWRWKHPL[
7DEOH &RORXUFRGHIRUWKHGHHSSXUSOHDQGWKHUDLQERZLQGLFDWRUFRPPHUFLDOO\DYDLODEOHIURP 7DEOH &RORXUFRGHIRUWKHGHHSSXUSOHDQGWKHUDLQERZLQGLFDWRUFRPPHUFLDOO\DYDLODEOHIURP
*HUPDQQ,QVWUXPHQWV$IWHU>&DPSEHOOHWDO*,@ *HUPDQQ,QVWUXPHQWV$IWHU>&DPSEHOOHWDO*,@
7DEOH (IIHFWLYHGLIIXVLRQFRHIILFLHQWRIFKORULGHLRQVWKURXJKFHPHQWSDVWHDQGFRQFUHWHLQí 7DEOH (IIHFWLYHGLIIXVLRQFRHIILFLHQWRIFKORULGHLRQVWKURXJKFHPHQWSDVWHDQGFRQFUHWHLQí
PVIURPGLIIHUHQWVRXUFHV>$@>3DJHHWDO@>%@>7XXWWL@>&@>%HUNH  PVIURPGLIIHUHQWVRXUFHV>$@>3DJHHWDO@>%@>7XXWWL@>&@>%HUNH 
+LFNV@ +LFNV@
7DEOH 7\SLFDOFUDFNFODVVLILFDWLRQVZLGWKVFDXVHVGHSWKVDQGGLVWDQFHV$IWHU>1LOVVRQHWDO 7DEOH 7\SLFDOFUDFNFODVVLILFDWLRQVZLGWKVFDXVHVGHSWKVDQGGLVWDQFHV$IWHU>1LOVVRQHWDO
@ @
7DEOH 6SHFLILHG >/0* E@ DQG DYHUDJHG PHDVXUHG FRPSRVLWLRQ RI LQYHVWLJDWHG FDUERQ 7DEOH 6SHFLILHG >/0* E@ DQG DYHUDJHG PHDVXUHG FRPSRVLWLRQ RI LQYHVWLJDWHG FDUERQ
VWHHOVDPSOH µ//¶ ORQJLWXGLQDOVHFWLRQ µ&6¶ FURVVVHFWLRQ VWHHOVDPSOH µ//¶ ORQJLWXGLQDOVHFWLRQ µ&6¶ FURVVVHFWLRQ
7DEOH 7KHUPRG\QDPLF GDWD GHOWD VFDOH  RI IHUURXV LRQ IURP WKH µ+6&¶ GDWDEDVH >:DJPDQ 7DEOH 7KHUPRG\QDPLF GDWD GHOWD VFDOH  RI IHUURXV LRQ IURP WKH µ+6&¶ GDWDEDVH >:DJPDQ
HWDO@DQGIURP>)UHLHVOHEHQ+DQVHQ@ZLWKµ¨*¶DQGµ(¶IRUUHGXFWLRQRI HWDO@DQGIURP>)UHLHVOHEHQ+DQVHQ@ZLWKµ¨*¶DQGµ(¶IRUUHGXFWLRQRI
IHUURXVLRQFDOFXODWHGRQWKDWEDVLVµ¨*I¶IURP>3RXUEDL[E@ZLWKµ¨*¶DQGµ(¶ IHUURXVLRQFDOFXODWHGRQWKDWEDVLVµ¨*I¶IURP>3RXUEDL[E@ZLWKµ¨*¶DQGµ(¶
IRU UHGXFWLRQ RI IHUURXV LRQ FDOFXODWHG RQ WKDW EDVLV DQG µ(¶ DV VSHFLILHG E\ >-RQHV IRU UHGXFWLRQ RI IHUURXV LRQ FDOFXODWHG RQ WKDW EDVLV DQG µ(¶ DV VSHFLILHG E\ >-RQHV
@DQGRWKHUOLWHUDWXUH @DQGRWKHUOLWHUDWXUH
7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ6(3'¶RIWKHJHQHUDO)H+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ6(3'¶RIWKHJHQHUDO)H+2V\VWHP
7DEOH 0RODUPDVVHV>2XNX2XNX:HE(OH@DQGLRQDFWLYLWLHVLQPRO/DQG 7DEOH 0RODUPDVVHV>2XNX2XNX:HE(OH@DQGLRQDFWLYLWLHVLQPRO/DQG
PJ/WDNHQLQWRFRQVLGHUDWLRQLQ3RXUEDL[GLDJUDPVWRHYDOXDWHWKHHIIHFWRIFKDQJHVLQ PJ/WDNHQLQWRFRQVLGHUDWLRQLQ3RXUEDL[GLDJUDPVWRHYDOXDWHWKHHIIHFWRIFKDQJHVLQ
WKHLRQDFWLYLW\ WKHLRQDFWLYLW\
7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH&D&+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH&D&+2V\VWHP
7DEOH 9ROXPHVRIFRUURVLRQSURGXFWVEDVHGRQFPLURQ J)H 9DOXHVHVWLPDWHGIURP 7DEOH 9ROXPHVRIFRUURVLRQSURGXFWVEDVHGRQFPLURQ J)H 9DOXHVHVWLPDWHGIURP
EDUFKDUWLQ>+HUKROGWHWDO@ EDUFKDUWLQ>+HUKROGWHWDO@
7DEOH 6SHFLHV SUHVHOHFWHG IRU WKH µ6(3'¶ RI WKH )H+2 V\VWHP FRQVLGHULQJ IRUPDWLRQ RI 7DEOH 6SHFLHV SUHVHOHFWHG IRU WKH µ6(3'¶ RI WKH )H+2 V\VWHP FRQVLGHULQJ IRUPDWLRQ RI
)H22+LQVWHDGRI)H2 )H22+LQVWHDGRI)H2
7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH)H&O+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH)H&O+2V\VWHP
7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ6(3'¶RIWKH&U+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ6(3'¶RIWKH&U+2V\VWHP
7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH&U)H+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH&U)H+2V\VWHP
7DEOH 5HTXLUHGVSHFLILHG>/0*E@DQGDYHUDJHGPHDVXUHGFRPSRVLWLRQRILQYHVWLJDWHG 7DEOH 5HTXLUHGVSHFLILHG>/0*E@DQGDYHUDJHGPHDVXUHGFRPSRVLWLRQRILQYHVWLJDWHG
VWDLQOHVVVWHHOVDPSOH µ//¶ /RQJLWXGLQDOVHFWLRQ VWDLQOHVVVWHHOVDPSOH µ//¶ /RQJLWXGLQDOVHFWLRQ
7DEOH 3ULFHUDQJHVRIVHOHFWHGFRXQWHUPHDVXUHVIRUQHZVWUXFWXUHVIURPGLIIHUHQWVRXUFHV>$@ 7DEOH 3ULFHUDQJHVRIVHOHFWHGFRXQWHUPHDVXUHVIRUQHZVWUXFWXUHVIURPGLIIHUHQWVRXUFHV>$@
>%HUWROLQLHWDO@>%@>,=$@>&@>1UQEHUJHU@ >%HUWROLQLHWDO@>%@>,=$@>&@>1UQEHUJHU@
7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ6(3'¶RIWKH=Q+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ6(3'¶RIWKH=Q+2V\VWHP
7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH=Q&+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH=Q&+2V\VWHP
7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH=Q&O+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH=Q&O+2V\VWHP

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;;,; 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;;,;


/LVWRI7DEOHV /LVWRI7DEOHV

7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH)H=Q&O+2DQGWKH=Q)H&O+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH)H=Q&O+2DQGWKH=Q)H&O+2V\VWHP


 
7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ6(3'¶RIWKH0J+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ6(3'¶RIWKH0J+2V\VWHP
7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH0J&O+2V\VWHP 7DEOH 6SHFLHVSUHVHOHFWHGIRUWKHµ0(3'¶RIWKH0J&O+2V\VWHP
7DEOH 6SHFLHV SUHVHOHFWHG IRU WKH µ0(3'¶ RI WKH &D0J& V\VWHP DQG WKH 0J&D&+2 7DEOH 6SHFLHV SUHVHOHFWHG IRU WKH µ0(3'¶ RI WKH &D0J& V\VWHP DQG WKH 0J&D&+2
V\VWHP V\VWHP
7DEOH &RQQHFWLRQV HVWDEOLVKHG RQ WKH GLVWULEXWLRQ WHUPLQDO ERDUG DQG DVVRFLDWHG GDWDORJJHU 7DEOH &RQQHFWLRQV HVWDEOLVKHG RQ WKH GLVWULEXWLRQ WHUPLQDO ERDUG DQG DVVRFLDWHG GDWDORJJHU
FKDQQHOV DQG LQGLFHV µ(&DW¶ H[WHUQDO FDWKRGH µ((:¶ HPEHGGHG HOHFWURGH ZLUH FKDQQHOV DQG LQGLFHV µ(&DW¶ H[WHUQDO FDWKRGH µ((:¶ HPEHGGHG HOHFWURGH ZLUH
µ(FRUU¶ FRUURVLRQ SRWHQWLDO µLPDF¶ PDFURFHOO FXUUHQW DQG µ6&(¶ VDWXUDWHG FDORPHO µ(FRUU¶ FRUURVLRQ SRWHQWLDO µLPDF¶ PDFURFHOO FXUUHQW DQG µ6&(¶ VDWXUDWHG FDORPHO
HOHFWURGH7KHFRORXUFRGHIRUWKHFRQQHFWLRQVFRUUHVSRQGVWRWKHFRORXUVXVHGIRUWKH HOHFWURGH7KHFRORXUFRGHIRUWKHFRQQHFWLRQVFRUUHVSRQGVWRWKHFRORXUVXVHGIRUWKH
FRQGXFWRUVFRQQHFWHGWRWKHVZLWFKFDUG FI)LJXUHLQ6HFWLRQ  FRQGXFWRUVFRQQHFWHGWRWKHVZLWFKFDUG FI)LJXUHLQ6HFWLRQ 
 

;;; 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;;; 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


 

/LVWRI&KHPLFDO6SHFLHV /LVWRI&KHPLFDO6SHFLHV
7KHIRUPXODVRIWKHPRVWLPSRUWDQWFKHPLFDOVSHFLHVPHQWLRQHGWKURXJKRXWWKLVWKHVLV 7KHIRUPXODVRIWKHPRVWLPSRUWDQWFKHPLFDOVSHFLHVPHQWLRQHGWKURXJKRXWWKLVWKHVLV
DUHOLVWHGDOSKDEHWLFDOO\WRJHWKHUZLWKWKHLUFRUUHVSRQGLQJQDPHVLQWKHWDEOHEHORZ DUHOLVWHGDOSKDEHWLFDOO\WRJHWKHUZLWKWKHLUFRUUHVSRQGLQJQDPHVLQWKHWDEOHEHORZ

)RUPXOD 1DPH  )RUPXOD 1DPH )RUPXOD 1DPH  )RUPXOD 1DPH


 
$J 6LOYHU  )H  )HUURXVLRQ $J 6LOYHU  )H  )HUURXVLRQ
$J&O 6LOYHUFKORULGH  )H )HUULFLRQ $J&O 6LOYHUFKORULGH  )H )HUULFLRQ
$J12 6LOYHUQLWUDWH  )H&O )HUURXVFKORULGH $J12 6LOYHUQLWUDWH  )H&O )HUURXVFKORULGH
& &DUERQ  )H&O )HUULFFKORULGH & &DUERQ  )H&O )HUULFFKORULGH
&D &DOFLXP  )H2 +HPDWLWH &D &DOFLXP  )H2 +HPDWLWH
&D&O &DOFLXPFKORULGH  )H& &HPHQWLWH &D&O &DOFLXPFKORULGH  )H& &HPHQWLWH
&D&2 &DOFLXPFDUERQDWH ,URQFDUERQDWH &D&2 &DOFLXPFDUERQDWH ,URQFDUERQDWH
 )H&2  )H&2
&D) &DOFLXPIOXRULGH VLGHULWH  &D) &DOFLXPIOXRULGH VLGHULWH 

&DOFLXPPDJQHVLXP )H2 0DJQHWLWH &DOFLXPPDJQHVLXP )H2 0DJQHWLWH


&D0J &2  &D0J &2 
FDUERQDWH GRORPLWH  )H2  í
)HUULWHLRQ FDUERQDWH GRORPLWH  )H2  í
)HUULWHLRQ
&D2 &DOFLXPR[LGH )H22+ *RHWKLWH &D2 &DOFLXPR[LGH )H22+ *RHWKLWH
&D2 &DOFLXPSHUR[LGH  )H 2+  ,URQ ,, K\GUR[LGH &D2 &DOFLXPSHUR[LGH  )H 2+  ,URQ ,, K\GUR[LGH
&D 2+  &DOFLXPK\GUR[LGH )H 2+  ,URQ ,,, K\GUR[LGH &D 2+  &DOFLXPK\GUR[LGH )H 2+  ,URQ ,,, K\GUR[LGH
 
&D2Â$O2 7ULFDOFLXPDOXPLQDWH + +\GURJHQLRQ &D2Â$O2 7ULFDOFLXPDOXPLQDWH + +\GURJHQLRQ
7HWUDFDOFLXP +  +\GURJHQ 7HWUDFDOFLXP + +\GURJHQ
&D2Â$O2Â)H2 &D2Â$O2Â)H2
IHUURDOXPLQDWH  +2 :DWHU IHUURDOXPLQDWH  +2 :DWHU
&D2Â6L2 'LFDOFLXPVLOLFDWH +&O +\GURFKORULFDFLG &D2Â6L2 'LFDOFLXPVLOLFDWH +&O +\GURFKORULFDFLG
 
&D2Â6L2 7ULFDOFLXPVLOLFDWH +\GURJHQ &D2Â6L2 7ULFDOFLXPVLOLFDWH +\GURJHQ
+&2í +&2í
&D6L2 &DOFLXPVLOLFDWH FDUERQDWHLRQ &D6L2 &DOFLXPVLOLFDWH FDUERQDWHLRQ
&D62Â+2 *\SVXP  +&U2í +\GURJHQFKURPDWHLRQ &D62Â+2 *\SVXP  +&U2í +\GURJHQFKURPDWHLRQ
í
&+2 3KHQROSKWKDOHLQ +)H2  %LK\SRIHUULWHLRQ &+2 3KHQROSKWKDOHLQ +)H2í %LK\SRIHUULWHLRQ
í í
&2  &DUERQDWHLRQ +J 0HUFXU\ &2  &DUERQDWHLRQ +J 0HUFXU\
&O &KORULGH  0HUFXU\FKORULGH &O &KORULGH  0HUFXU\FKORULGH
+J&O +J&O
&Oí &KORULGHLRQ FDORPHO  &Oí &KORULGHLRQ FDORPHO 
&O2í 3HUFKORUDWHLRQ +=Q2í %L]LQFDWHLRQ &O2í 3HUFKORUDWHLRQ +=Q2í %L]LQFDWHLRQ
 
&2 &DUERQGLR[LGH ,U ,ULGLXP &2 &DUERQGLR[LGH ,U ,ULGLXP
&U &KURPH  ,U2 ,ULGLXP ,9 R[LGH &U &KURPH  ,U2 ,ULGLXP ,9 R[LGH
&U &KURPRXVLRQ  ,U2 ,ULGLXP ,,, R[LGH &U &KURPRXVLRQ  ,U2 ,ULGLXP ,,, R[LGH

&U  &KURPLFLRQ  . 3RWDVVLXP &U &KURPLFLRQ  . 3RWDVVLXP
 
&U2 &KURPLFR[LGH  . 3RWDVVLXPLRQ &U2 &KURPLFR[LGH  . 3RWDVVLXPLRQ
&U2í &KURPLWHLRQ  .&O 3RWDVVLXPFKORULGH &U2í &KURPLWHLRQ  .&O 3RWDVVLXPFKORULGH
&U2í &KURPDWHLRQ  .2+ 3RWDVVLXPK\GUR[LGH &U2í &KURPDWHLRQ  .2+ 3RWDVVLXPK\GUR[LGH
&U)H2 &KURPLXPLURQR[LGH 0J 0DJQHVLXP &U)H2 &KURPLXPLURQR[LGH 0J 0DJQHVLXP
 
&X &RSSHU 0J 0DJQHVLXPLRQ &X &RSSHU 0J 0DJQHVLXPLRQ
&X &XSULFLRQ 0J2 0DJQHVLXPSHUR[LGH &X &XSULFLRQ 0J2 0DJQHVLXPSHUR[LGH
 
&X62 &XSULFVXOSKDWH 0J 2+  0DJQHVLXPK\GUR[LGH &X62 &XSULFVXOSKDWH 0J 2+  0DJQHVLXPK\GUR[LGH
)H ,URQ  0R 0RO\EGHQXP )H ,URQ  0R 0RO\EGHQXP
 

'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;;;, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;;;,


/LVWRI&KHPLFDO6SHFLHV /LVWRI&KHPLFDO6SHFLHV

)RUPXOD 1DPH  )RUPXOD 1DPH )RUPXOD 1DPH  )RUPXOD 1DPH


0Q 0DQJDQHVH  62í 6XOSKDWHLRQ 0Q 0DQJDQHVH  62í 6XOSKDWHLRQ
0Q2 0DQJDQHVHWULR[LGH  7L 7LWDQLXP 0Q2 0DQJDQHVHWULR[LGH  7L 7LWDQLXP
0Q2 0DQJDQHVHGLR[LGH  =Q =LQF 0Q2 0DQJDQHVHGLR[LGH  =Q =LQF
1 1LWURJHQ  =Q =LQFLRQ 1 1LWURJHQ  =Q =LQFLRQ
1D 6RGLXPLRQ  =Q&O &KORUR]LQFLRQ 1D 6RGLXPLRQ  =Q&O &KORUR]LQFLRQ
1D&O 6RGLXPFKORULGH  =Q&2 =LQFFDUERQDWH 1D&O 6RGLXPFKORULGH  =Q&2 =LQFFDUERQDWH
1D2+ 6RGLXPK\GUR[LGH  =Q)H2 =LQFIHUULWH 1D2+ 6RGLXPK\GUR[LGH  =Q)H2 =LQFIHUULWH
6RGLXP =Q2í =LQFDWHLRQ 6RGLXP =Q2í =LQFDWHLRQ
1D32)  1D32) 
PRQRIOXRURSKRVSKDWH =Q 2+  =LQFK\GUR[LGH PRQRIOXRURSKRVSKDWH =Q 2+  =LQFK\GUR[LGH
1L 1LFNHO  Į)H )HUULWH 1L 1LFNHO  Į)H )HUULWH
1L 1LFNHORXVLRQ  Į)H2 +HPDWLWH 1L 1LFNHORXVLRQ  Į)H2 +HPDWLWH
2  2[\JHQ  Ȗ)H2 0DJKHPLWH 2 2[\JHQ  Ȗ)H2 0DJKHPLWH
í í
2+  +\GUR[\O  Į)H22+ *RHWKLWH 2+  +\GUR[\O  Į)H22+ *RHWKLWH
6L) 6LOLFRQWHWUDIOXRULGH  ȕ)H22+ $NDJDQHLWH 6L) 6LOLFRQWHWUDIOXRULGH  ȕ)H22+ $NDJDQHLWH
6L2 6LOLFRQGLR[LGH  Ȗ)H22+ /HSLGRFURFLWH 6L2 6LOLFRQGLR[LGH  Ȗ)H22+ /HSLGRFURFLWH
 

;;;,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN ;;;,, 'HSDUWPHQWRI&LYLO(QJLQHHULQJ7HFKQLFDO8QLYHUVLW\RI'HQPDUN


André Küter
In this thesis a consistent thermodynamic basis is established for the description of cor-
rosion processes as well as for the evaluation of existing and the development of new
corrosion countermeasures.

The work covers: a) the adaptation of available thermodynamic principles to the area of
reinforcement corrosion, b) thermodynamically consistent descriptions for the diverse
corrosion states of steel in concrete, c) a review and evaluation of available measures
for corrosion protection, and d) the development of theoretical concepts for new cost-
efficient countermeasures.

In addition to the theoretical considerations, two implementation principles of the de-


veloped concepts are proposed and one of these tested by means of custom-designed
setups and measurement methods.
Management of Reinforcement Corrosion
A Thermodynamic Approach

Management of Reinforcement Corrosion - A Thermodynamic Approach


André Küter

PhD Thesis

Department of Civil Engineering


2009

DTU Civil Engineering Report R-228 (UK)


April 2009

DTU Civil Engineering


Department of Civil Engineering
Technical University of Denmark

Brovej, Building 118


2800 Kgs. Lyngby
Report R-228 2009

Telephone 45 25 17 00

www.byg.dtu.dk

ISBN: 9788778773074
ISSN: 1601-2917

You might also like