Download as pdf or txt
Download as pdf or txt
You are on page 1of 83

7KH$UWDQG6FLHQFHRI3HUVRQDO0DJQHWLVP

7DEOHRI&RQWHQW

&KDSWHU3HUVRQDO0DJQHWLVP
&KDSWHU0HQWDODQG3K\VLFDO3ROHV
&KDSWHU7KH0HQWDO3KDVH
&KDSWHU7KH3K\VLFDO3KDVH
&KDSWHU3K\VLFDO0DJQHWLVP
&KDSWHU*HQHUDWLQJ1HUYH)RUFH
&KDSWHU'LVWULEXWLQJ1HUYH)RUFH
&KDSWHU1HUYH)RUFH([HUFLVHV
&KDSWHU3URMHFWLQJ1HUYH)RUFH
&KDSWHU0HQWDO5DGLDWLRQ
&KDSWHU0HQWDO$WWLWXGHV
&KDSWHU7KH0HQWDO$WPRVSKHUH
&KDSWHU0DJQHWLF&XUUHQWV
&KDSWHU7KH'LUHFW)ODVK
&KDSWHU([HUFLVHVLQWKH'LUHFW)ODVK
&KDSWHU7KH3RVLWLYH$XUD
&KDSWHU7KH'LUHFW&RPPDQG
&KDSWHU7KH0DJQHWLF'XHO
&KDSWHU&RUSRUHDO0DJQHWLVP
&KDSWHU0DJQHWLF6HOI'HIHQVH
&KDSWHU
3HUVRQDO0DJQHWLVP
7DEOHRI&RQWHQW

,WLVDVWUDQJHDQGDOPRVWDPXVLQJIDFWWKDWWKHUHVKRXOGEHDWWKHVDPHWLPHRQ
WKHSDUWRIWKHJHQHUDOSXEOLFVXFKDJHQHUDODFFHSWDQFHRIWKHH[LVWHQFHRI
SHUVRQDOPDJQHWLVPRQWKHRQHKDQGDQGVXFKDQLJQRUDQFHRIWKHQDWXUHRIWKLV
ZRQGHUIXOIRUFHRQWKHRWKHUKDQG,QVKRUWZKLOHHYHU\RQHEHOLHYHVLQWKH
H[LVWHQFHRISHUVRQDOPDJQHWLVPVFDUFHO\DQ\RQHSRVVHVVHVNQRZOHGJHRIWKH
UHDOQDWXUHRIWKHVDPHPXFKOHVVDZRUNLQJNQRZOHGJHRILWVSULQFLSOHVRI
DSSOLFDWLRQ
$EHOLHILQWKHH[LVWHQFHRIDSHUVRQDOSRZHULQIOXHQFHRUDWPRVSKHUHRQ
WKHSDUWRIFHUWDLQLQGLYLGXDOVZKLFKHQDEOHVWKHSRVVHVVRUWRDWWUDFWLQIOXHQFH
GRPLQDWHRUFRQWURORWKHUVKDVEHHQKHOGE\WKHUDFHIURPWKHHDUOLHVWGD\VRI
ZULWWHQKLVWRU\0DQ\RIWKHROGHVWZULWLQJVRIWKHUDFHFRQWDLQUHIHUHQFHVWRWKH
VWUDQJHP\VWHULRXVSRZHUSRVVHVVHGE\FHUWDLQLQGLYLGXDOVZKLFKHQDEOHGWKHP
WRDWWUDFWRULQIOXHQFHRWKHUV$QGIROORZLQJWKHFRXUVHRIZULWWHQKXPDQKLVWRU\
DORQJWKHDJHVZHPD\SHUFHLYHDFRQVWDQWUHIHUHQFHWRWKLVVWUDQJHSRZHURIWKH
LQGLYLGXDOVRJHQHUDOO\DFNQRZOHGJHGDQGDWWKHVDPHWLPHVROLWWOHXQGHUVWRRG
&RPLQJGRZQWRWKHSUHVHQWDJHDQDJHLQZKLFKJUHDWDWWHQWLRQKDVEHHQ
GHYRWHGWRWKHVWXG\RISV\FKRORJ\DQGSV\FKLFVXEMHFWVLQJHQHUDOZHILQGWKDW
ZKLOHWKHROGEHOLHILQSHUVRQDOPDJQHWLVPKDVEHHQVWUHQJWKHQHGWKHUHH[LVWVDW
WKHVDPHWLPHYHU\OLWWOHJHQHUDONQRZOHGJHDPRQJWKHSXEOLFUHJDUGLQJWKHUHDO
QDWXUHRIWKHIRUFHRUWKHEHVWPHDQVRIXVLQJDQGHPSOR\LQJLW
%XWWKLVODFNRINQRZOHGJHMXVWDOOXGHGWRRLVFRQILQHGWRWKHJHQHUDOSXEOLF
,QDOODJHVWKHUHKDYHEHHQDIHZDGYDQFHGLQGLYLGXDOVZKRKDYHWKRURXJKO\
XQGHUVWRRGDQGHPSOR\HGWKHIRUFHRISHUVRQDOLQIOXHQFH1RWRQO\KDYHWKH
RFFXOWVWXGHQWVRIWKHSDVWSRVVHVVHGWKLVNQRZOHGJHDQGKDYHSDVVHGLWRQWR
WKHLUVXFFHVVRUVEXWPDQ\RIWKHJUHDWHVWPHQRIKLVWRU\KDYHDFTXLUHGD
WKRURXJKNQRZOHGJHOLNHZLVHDQGKDYHHPSOR\HGLWLQDGYDQFLQJWKHLURZQ
LQWHUHVWV,QVRPHFDVHVLQGLYLGXDOVRIWKLVODVWPHQWLRQHGFODVVKDYHUHFHLYHG
GLUHFWLQVWUXFWLRQIURPRFFXOWWHDFKHUVEXWLQPDQ\FDVHVWKH\KDYHVWXPEOHG
DFURVVWKHH[LVWHQFHRIWKHSRZHUZLWKLQWKHPVHOYHVDQGWKHQDGYDQFHGLQWKHLU
NQRZOHGJHRIWKHVXEMHFWE\FDUHIXOLQYHVWLJDWLRQDQGVWXG\DFFRPSDQLHGE\
FRQVWDQWH[SHULPHQWDWLRQ0DQ\RIWKHPLQWKHLUZULWLQJVRUVD\LQJVKDYH
WHVWLILHGWRWKHLUNQRZOHGJHDQGXVRIWKLVPRVWZRQGHUIXOSRZHU,WLVGLIILFXOW
WHVWLILHGWRWKHLUNQRZOHGJHDQGXVRIWKLVPRVWZRQGHUIXOSRZHU,WLVGLIILFXOW
HYHQWRFRUUHFWO\GHILQHWKHWHUPSHUVRQDOPDJQHWLVPVROLWWOHDUHLWVSULQFLSOHV
XQGHUVWRRGE\WKHPDVVHVRIWKHSHRSOH7KHGLFWLRQDULHVJLYHXVEXWOLWWOHKHOSLQ
WKHPDWWHUVRYDJXHDUHWKHLUVRFDOOHGGHILQLWLRQV3HUKDSVWKHEHVWGHILQLWLRQLV
WKHIROORZLQJWKHVWURQJSHFXOLDUEXWOLWWOHXQGHUVWRRGSRZHUIRUFHRU
LQIOXHQFHH[HUWHGE\FHUWDLQLQGLYLGXDOVLQYDU\LQJGHJUHHVE\WKHPHDQVRI
ZKLFKRWKHUSHUVRQVDUHDWWUDFWHGWRFRQWUROOHGE\GRPLQDWHGRULQIOXHQFHGE\
WKHLQGLYLGXDOSRVVHVVLQJWKHSRZHUDIRUPRIPHQWDOLQIOXHQFHH[HUWHGE\
FHUWDLQLQGLYLGXDOVRYHUWKRVHZLWKZKRPWKH\FRPHLQFRQWDFW
7KHSULQFLSDOREMHFWLRQWKDW,SHUVRQDOO\KDYHWRWKHDERYHRWKHUZLVHIDLUO\
JRRGGHILQLWLRQLVLWLPSOLHVWKDWRQO\FHUWDLQLQGLYLGXDOVSRVVHVVSHUVRQDO
PDJQHWLVPWKHLPSOLFDWLRQEHLQJWKDWWKHUHPDLQGHURIWKHUDFHDUHGHYRLGRILW
7KLVLQP\RSLQLRQLVDVDGPLVWDNH7KHWUXWKLVHDFKDQGHYHU\LQGLYLGXDOLV
LQSRVVHVVLRQRIDFHUWDLQGHJUHHRISHUVRQDOPDJQHWLVPWKDWHDFKSHUVRQPD\
LQFUHDVHWKHGHJUHHDQGVWUHQJWKHQWKHSRZHUE\NQRZOHGJHDQGSUDFWLFH
(YHQWKHPRVWXQPDJQHWLFSHUVRQSRVVHVVHVSHUVRQDOPDJQHWLVPSHUKDSV
HYHQWRDFRQVLGHUDEOHGHJUHHEXWLVJHQHUDOO\VRLJQRUDQWRIWKHQDWXUHRIWKH
IRUFHRIWKHPHDQVRILWVHPSOR\PHQWWKDWKHRUVKHDFWXDOO\UHSHOVRWKHUSHUVRQV
LQVWHDGRIDWWUDFWLQJWKHP)RUGRQRWIDLOWRQRWHWKLVIDFWSHUVRQDOPDJQHWLVP
OLNHPDWHULDOPDJQHWLVPPD\UHSHODVZHOODVDWWUDFWLWKDVLWVSRVLWLYHDVZHOO
DVLWVQHJDWLYHVLGH0DQ\YHU\UHSHOOHQWSHUVRQVDUHUHDOO\PDQLIHVWLQJDKLJK
GHJUHHRISHUVRQDOPDJQHWLVPLQDQHJDWLYHIRUPDQGDUHGULYLQJDZD\SHUVRQV
IURPWKHPLQWKHVDPHPDQQHUWKDWRWKHUVDWWUDFWSHUVRQVWRWKHPȈLWLVDOOD
PDWWHURIWKHXVHRIWKHSRZHU
7KHIDFWLVWKDWHYHU\SHUVRQJHQHUDWHVDQGWKURZVRIIDFHUWDLQGHJUHH
YDU\LQJDPRQJGLIIHUHQWLQGLYLGXDOV RISHUVRQDOPDJQHWLVPZKLFKDIIHFWVWKH
PLQGVRIRWKHUSHUVRQVFRPLQJZLWKLQWKHILHOGRILWVLQIOXHQFH1RWRQO\GRHV
HDFKSHUVRQHPDQDWHDQGSURMHFWDFHUWDLQDPRXQWRUGHJUHHRISHUVRQDO
PDJQHWLVPDGGLWLRQDOO\HDFKSHUVRQLVDOVRFRQVWDQWO\VXUURXQGHGE\DILHOGRI
SHUVRQDOPDJQHWLFLQIOXHQFHȈDSHUVRQDODWPRVSKHUHVRWRVSHDN7KLVSHUVRQDO
DWPRVSKHUHDIIHFWVWRDJUHDWHURUOHVVHUGHJUHHRWKHUSHUVRQVFRPLQJZLWKLQLWV
ILHOGRILQIOXHQFH
7KLVSHUVRQDODWPRVSKHUHYDULHVJUHDWO\LQGHJUHHRIVWUHQJWKH[WHQWDQG
JHQHUDOFKDUDFWHUDPRQJGLIIHUHQWLQGLYLGXDOV7KHDYHUDJHSHUVRQKDVEXWD
ZHDNSHUVRQDODWPRVSKHUHZKLFKH[WHQGVEXWDVKRUWGLVWDQFHRQDOOVLGHVRI
KLPZKLOHWKHVWURQJFKDUDFWHUVRIWKHUDFHDUHVXUURXQGHGE\DZLGHO\VSUHDG
SHUVRQDODWPRVSKHUHRIJUHDWSRZHUHVSHFLDOO\ZKHQWKH\DUHDURXVHGE\DQ\
VWURQJHPRWLRQIHHOLQJRUGHVLUH7KHSHUVRQDODWPRVSKHUHRIWKRVHVWURQJ
LQGLYLGXDOVZKRDUHJHQHUDOO\UHFRJQL]HGDVOHDGHUVRIWKHUDFHXVXDOO\H[WHQGV
JUHDWGLVWDQFHVIURPWKHSHUVRQDQGLVIDLUO\VDWXUDWHGZLWKVWURQJG\QDPLF
PDJQHWLVPZKLFKLPSUHVVHVLWVHOIVWURQJO\XSRQWKRVHFRPLQJZLWKLQWKHLUILHOG
PDJQHWLVPZKLFKLPSUHVVHVLWVHOIVWURQJO\XSRQWKRVHFRPLQJZLWKLQWKHLUILHOG
RILQIOXHQFH
%XWHYHQWKHZHDNHULQGLYLGXDOVRIWKHUDFHRUXVLQJSHUVRQDOPDJQHWLVP
XQFRQVFLRXVO\H[HUWDWOHDVWVRPHGHJUHHRILQIOXHQFHXSRQWKRVHDURXQGWKHP
,WUHTXLUHVEXWDPRPHQW VWKRXJKWWRUHFRJQL]HWKDWVRPHSHUVRQVHPDQDWHDQ
DWPRVSKHUHRIJRRGFKHHUEULJKWQHVVDQGKDSSLQHVVZKLFKDIIHFWVLQD
GHVLUDEOHZD\DOOSHUVRQVZLWKZKRPWKH\FRPHLQFRQWDFW2WKHUVLQWKHVDPH
ZD\DUHVXUURXQGHGE\DQDWPRVSKHUHRIJORRPSHVVLPLVPDQG
GLVFRXUDJHPHQWZKLFKDGYHUVHO\DIIHFWVSHUVRQVFRPLQJQHDUWKHP7KHVH
WKLQJVDUHWRRFRPPRQWRHYHQH[FLWHLQWHUHVWDPRQJWKHDYHUDJHSHUVRQVEXWLQ
WKLVSKHQRPHQDPD\EHIRXQGWKHNH\WRWKHKLJKHUIRUPVRISHUVRQDO
PDJQHWLVP
:HDUHVRDFFXVWRPHGWRUHJDUGLQJSHUVRQDOPDJQHWLVPDVPHDQLQJRQO\WKH
SRVLWLYHDWWUDFWLYHSKDVHWKDWLWFRPHVDVDVKRFNWRVRPHRIXVWREHWROGWKDW
WKHUHSHOOLQJSHUVRQDODWPRVSKHUHLVHTXDOO\PDJQHWLFȈWKDWLVPDJQHWLFLQWKH
ZURQJGLUHFWLRQ7KLVVKRXOGFDXVHQRZRQGHUZKHQZHUHPHPEHUWKDWHYHQWKH
SK\VLFDOPHWDOOLFPDJQHWUHSHOVXQGHUVRPHFLUFXPVWDQFHVDVVWURQJO\DVLW
DWWUDFWVXQGHURWKHUV7KHUHDUHLWLVWUXHFHUWDLQLQGLYLGXDOVZKRVHHPQHLWKHUWR
DWWUDFWQRUUHSHOEXWWKLVGRHVQRWDIIHFWWKHJHQHUDOUXOH7KHVHQHXWUDO
LQGLYLGXDOVDUHXVXDOO\RIZHDNPDJQHWLVPDQGZHDNFKDUDFWHUȈWKDWLVWRVD\
WKH\KDYHQRVWURQJPRWLYHVDLPVRUGHVLUHVRUVWURQJFDVWRIFKDUDFWHURU
SHUVRQDOLW\(DFKIDFXOW\RIWKHPHQWDOLW\LVQHXWUDOL]HGE\VRPHRWKHUIDFXOW\RI
HTXDOVWUHQJWKDQGWKHUHVXOWLVDQHXWUDOFRQGLWLRQDNLQWROXNHZDUPZDWHU
QHLWKHUKRWQRUFROG,WIROORZVQDWXUDOO\WKDWVXFKSHUVRQVH[HUWEXWDQHXWUDO
LQIOXHQFHDQGKDYHEXWDZHDNQHXWUDOSHUVRQDODWPRVSKHUH7KH\QHLWKHUDWWUDFW
QRUUHSHOȈWKH\VLPSO\ERUHSHUVRQVZLWKZKRPWKH\FRPHLQFRQWDFW
6RPHPD\UDLVHWKHTXHVWLRQWKDWLIDV,KDYHVDLGHDFKDQGHYHU\SHUVRQLV
SRVVHVVHGRISHUVRQDOPDJQHWLVPWKHQZK\VKRXOGDQ\RQHERWKHUDQ\PRUH
DERXWWKHPDWWHURUVWXG\WKHVXEMHFWRISHUVRQDOPDJQHWLVPDWDOO6XFKD
TXHVWLRQ DQGLWLVIUHTXHQWO\UDLVHGIRUWKDWPDWWHU FDXVHVDVPLOHWRPDQLIHVW
RQWKHIHDWXUHVRIWKRVHZKRKDYHNQRZOHGJHRIWKHVXEMHFWVRFKLOGLVKGRHVLW
VHHPWRWKHP:KLOHLWLVWUXHWKDWHDFKDQGHYHU\SHUVRQLVSRVVHVVHGRI
SHUVRQDOPDJQHWLVPWRVRPHGHJUHHLWLVHTXDOO\WUXHWKDWWKHPDMRULW\RI
SHUVRQVKDYHEXWDZHDNPDJQHWLFIRUFHDQGWKDWRIWHQRIDQHJDWLYHRU
XQGHVLUDEOHFKDUDFWHU$QGLWLVDIDFWSRVLWLYHO\NQRZQWRWKRVHZKRKDYH
PDVWHUHGWKHVXEMHFWWKDWHYHQWKHZHDNHVWDQGPRVWQHJDWLYHSHUVRQPD\VR
GHYHORSKLVRUKHUSHUVRQDOPDJQHWLVPDVWRJUDGXDOO\DFTXLUHWKHVDPHGHJUHH
DQGFKDUDFWHURIPDJQHWLVPDVWKDWSRVVHVVHGE\PDQ\LQGLYLGXDOVRULJLQDOO\IDU
LQDGYDQFHRIWKHPLQPDJQHWLFLQIOXHQFH
2QHPD\FRPSOHWHO\FKDQJHWKHFKDUDFWHURIKLVSHUVRQDOPDJQHWLVPIURP
2QHPD\FRPSOHWHO\FKDQJHWKHFKDUDFWHURIKLVSHUVRQDOPDJQHWLVPIURP
QHJDWLYHWRSRVLWLYHIURPXQGHVLUDEOHWRGHVLUDEOHE\FDUHIXOVWXG\DQGSUDFWLFH
DORQJWKHOLQHVZKLFK,VKDOOOD\GRZQLQWKLVERRN0RUHRYHULWLVSRVVLEOHIRU
DQ\SHUVRQSRVVHVVLQJVXIILFLHQWZLOOSHUVHYHUDQFHDQGGHWHUPLQDWLRQWRGHYHORS
IURPDSXQ\VWDWHRIPDJQHWLVPLQWRDFRQGLWLRQRIJLDQWPDJQHWLFSRZHUV%XW
WKLVODWWHUUHTXLUHVGHWHUPLQDWLRQFRQVWDQWSUDFWLFHXQWLODFHUWDLQVWDJHLV
UHDFKHGDQGDQLQGRPLWDEOHZLOO:KLOHDQ\RQHPD\HDVLO\LQFUHDVHKLVRUKHU
GHJUHHRISRZHURISHUVRQDOPDJQHWLVPDQGVWLOOPRUHHDVLO\FKDQJHWKH
FKDUDFWHURIRQH VSHUVRQDODWPRVSKHUHWKHKLJKHUSUL]HVDUHUHVHUYHGIRUWKRVH
ZKRZLOOSHUVHYHUHWRWKHHQGDQGFRQWLQXHIDLWKIXOLQWKHH[HUFLVHV7KLVRI
FRXUVHLVWUXHQRWRQO\RISHUVRQDOPDJQHWLVPEXWDOVRRIHYHU\RWKHUWKLQJ
ZRUWKKDYLQJ7KHUHLVQRUR\DOURDGWRDQ\WKLQJZRUWKKDYLQJ:HPXVWZRUN
IRUZKDWZHJHW7KHSUL]HVDUHQRWIRUWKHZHDNOLQJVDQGWULIOHUVEXWIRUWKH
SHUVLVWHQWHDUQHVWLQGLYLGXDOVZKRZLOOKDQJRQXQWLOWKH\VXFFHHG
,QWKLVOLWWOHERRN,JLYH\RXWKHNH\WRWKHVHFUHWRISHUVRQDOPDJQHWLVPEXW
LWZLOOVWLOOUHPDLQIRU\RX\RXUVHOYHVWRGHWHUPLQHMXVWZKDWGHJUHHRIVXFFHVV
\RXVKDOODWWDLQ,JLYH\RXWKHEHVWWRROVDQGLQVWUXFWLRQVDVWRKRZWRXVHWKHP
ȈEXW\RXZLOOKDYHWRGRWKHUHVW\RXUVHOI7KLV,ZLOOVD\KRZHYHUVXFFHVV
PXVWDQGZLOOEH\RXUVLI\RXZLOOIROORZWKHLQVWUXFWLRQVFDUHIXOO\SHUVLVWHQWO\
DQGSHUVHYHULQJO\7KDWLVDOO,FDQGRIRU\RXȈWKHUHVWLVLQ\RXURZQKDQGV
&KDSWHU
0HQWDODQG3K\VLFDO3ROHV
7DEOHRI&RQWHQW

6RPHRIWKHZULWHUVRQWKHVXEMHFWRISHUVRQDOPDJQHWLVPKDYHIDOOHQLQWRWKH
HUURURIFRQVLGHULQJWKDWWKHHQWLUHVHFUHWRISHUVRQDOPDJQHWLVPLVWREHIRXQGLQ
WKHSKHQRPHQDRIWHOHSDWK\RUWUDQVIHUHQFHRIWKRXJKW7KHVHZULWHUVKRZHYHU
KDYHEHHQVRFDUULHGDZD\E\WKHZRQGHUIXOIDFWVRIWKHPHQWDOSKDVHRI
SHUVRQDOPDJQHWLVPWKDWWKH\KDYHHQWLUHO\RYHUORRNHGWKHRWKHUSKDVHLHWKH
SK\VLFDOSROHRIWKHPDJQHWLFSHUVRQDOLW\7KLVVHFRQGSKDVHLVMXVWDVLPSRUWDQW
DVLVWKHPHQWDOSKDVHDQGWKHSHUVRQZKRZLVKHVWRFXOWLYDWHDQGGHYHORS
SHUVRQDOPDJQHWLVPPXVWJLYHWKLVVHFRQGSKDVHWKHVDPHFDUHIXODWWHQWLRQDQG
SUDFWLFHDVWKHILUVWSKDVH7KHUHDUHWZRGLVWLQFWSKDVHVRUSROHVRISHUVRQDO
PDJQHWLVP  WKHPHQWDODQG  WKHSK\VLFDO'RQRWIDLOWRQRWHWKLVIDFWIRU
\RXUVXFFHVVZLOOGHSHQGXSRQWKHFRRUGLQDWLRQRIWKHIRUFHRIERWKSROHV
7RPDQ\WKLVLGHDRIWKHUHEHLQJDVHFRQGRUSK\VLFDOSKDVHRISHUVRQDO
PDJQHWLVPZLOOVHHPVWUDQJHVRDFFXVWRPHGKDYHWKH\JURZQWRKHDULQJWKH
WHDFKLQJVWKDWSHUVRQDOPDJQHWLVPLVDPHQWDOSKHQRPHQRQSXUHDQGVLPSOH%XW
DVZHSURFHHGLQRXUVWXG\RIWKHVXEMHFWLQWKLVERRN,KRSHWRWKRURXJKO\
FRQYLQFH\RXWKDWWKLVVHFRQGSROHRISHUVRQDOPDJQHWLVPUHDOO\H[LVWVDQGWKDW
LWLVHTXDOO\SRWHQWDVWKHILUVWRUPHQWDOSKDVHRUSROH$PDQLVDGXDO
RUJDQLVPZLWKERWKPHQWDODQGSK\VLFDOSKDVHVRIPDQLIHVWDWLRQERWKPLQGDQG
ERG\VRLVKLVSHUVRQDOIRUFHFRPSRVHGRIWZRGLVWLQFWSKDVHVRUSROHVHDFK
FRRUGLQDWLQJZLWKWKHRWKHULQWKHZRUNRIPDQLIHVWLQJHQHUJ\DQGFUHDWLQJ
HIIHFWV6RPHSHUVRQVKDYHPRUHPHQWDOPDJQHWLVPZKLOHRWKHUVKDYHPRUH
SK\VLFDOPDJQHWLVPEXWWKHLQGLYLGXDOZKRUHDOO\PDQLIHVWVWKHKLJKHVWGHJUHH
RISHUVRQDOPDJQHWLVPLVWKHRQHZKRLVGHYHORSHGDORQJERWKSROHVRIDFWLYLW\
ERWKSKDVHVRIPDJQHWLVPȈSK\VLFDODVZHOODVPHQWDO
7KHPHQWDOSROHRUSKDVHRISHUVRQDOPDJQHWLVPGHSHQGVIRULWVIRUFHDQG
HQHUJ\XSRQWKHDELOLW\RIWKHPLQGWRFUHDWHWKRXJKWZDYHVDQGWRSURMHFWWKHP
EH\RQGWKHOLPLWVRIWKHEUDLQLQWRWKHSHUVRQDODWPRVSKHUHRIWKHLQGLYLGXDO
DQGHYHQEH\RQGWKHUDQJHRIKLVRZQSHUVRQDODWPRVSKHUHZKHQQHFHVVDU\
:KHQDFFRPSDQLHGZLWKWKHSK\VLFDOPDJQHWLVPJHQHUDWHGE\WKHRWKHUSROHRI
PDJQHWLFDFWLYLW\WKLVPHQWDOPDJQHWLVPVWURQJO\DIIHFWVRWKHUSHUVRQVFRPLQJ
ZLWKLQWKHILHOGRIDFWLRQRIWKHVHWKRXJKWZDYHV%XWZLWKRXWDJRRGVXSSO\RI
WKHSK\VLFDOPDJQHWLVPWKHVHWKRXJKWZDYHVIDLOWRKDYHVXIILFLHQWVWUHQJWKWR
WKHSK\VLFDOPDJQHWLVPWKHVHWKRXJKWZDYHVIDLOWRKDYHVXIILFLHQWVWUHQJWKWR
SURGXFHPDUNHGUHVXOWV,WZRXOGVHHPWKDWWKHSK\VLFDOPDJQHWLVPZHUHQHHGHG
WRJLYHERG\WRWKHPHQWDOPDJQHWLVPMXVWDVWKHPHQWDOPDJQHWLVPLVQHHGHG
WRJLYHFRORUFKDUDFWHURUVRXOWRWKHSK\VLFDOPDJQHWLVP7KHWZRSKDVHVRI
PDJQHWLVPPXVWZRUNWRJHWKHUWRJDLQWKHEHVWHIIHFWV
,WZDVIRUPHUO\YHU\GLIILFXOWWRFRQYH\WRWKHPLQGRIWKHVWXGHQWWKHIDFWV
UHJDUGLQJWKHPHQWDOSKDVHRISHUVRQDOPDJQHWLVPVRVWUDQJHGLGWKHZKROH
WKLQJDSSHDUWRKLP%XWLQWKHVHGD\VZKHQWKHUHKDVEHHQVRPXFKZULWWHQDQG
WDXJKWUHJDUGLQJWHOHSDWK\WKRXJKWWUDQVIHUHQFHDQGPLQGSRZHUWKHDYHUDJH
SHUVRQLVVRZHOOSRVWHGRQWKHJHQHUDOVXEMHFWWKDWKHPD\UHDGLO\XQGHUVWDQG
WKHVSHFLDOIHDWXUHVRIWKRXJKWSRZHUDVPDQLIHVWHGRQSHUVRQDOPDJQHWLVP6RLW
LVQRWQHFHVVDU\QRZWRILUVWJLYHWKHVWXGHQWDWKRURXJKHGXFDWLRQUHJDUGLQJ
WKHJHQHUDOVXEMHFWRIWHOHSDWK\LQRUGHUWROHDGKLPXSWRWKHVSHFLDOVXEMHFWRI
SHUVRQDOPDJQHWLVP,QWKLVERRN,VKDOOWDNHLWIRUJUDQWHGWKDWWKHVWXGHQW
NQRZVVRPHWKLQJRIWKHVXEMHFWRIWHOHSDWK\RUWKRXJKWWUDQVIHUHQFHDQG
DFFRUGLQJO\,VKDOOQRWWDNHXSVSDFHDQGWLPHLQWUDYHOLQJRYHUWKLVROGIDPLOLDU
JURXQG%XWQHYHUWKHOHVV,WKLQNLWDGYLVDEOHWRSRLQWRXWWR\RXVRPHRIWKH
ODWHVWIDFWVGLVFRYHUHGE\VFLHQFHLQFRQQHFWLRQZLWKWKHWUDQVIHUHQFHRIWKRXJKW
6FLHQFHKDVGLVFRYHUHGWKDWWKHKXPDQEUDLQLQWKHSURFHVVHVRIWKLQNLQJ
DFWXDOO\JHQHUDWHVDQGXVHVXSDFHUWDLQDPRXQWRIHQHUJ\LQWKHDUHDRIWKHEUDLQ
WLVVXH7KHJHQHUDWLRQDQGHPSOR\PHQWRIWKLVHQHUJ\SURGXFHVKHDWDQG
DFWXDOO\LQFUHDVHVWKHWHPSHUDWXUHRIWKHEUDLQDUHDVDVPD\EHSURYHQE\WKH
XVHRIWKHGHOLFDWHUHJLVWHULQJLQVWUXPHQWV)RXQGLQHYHU\ZHOOHTXLSSHGEUDLQLV
DVPXFKDQDFWXDOIRUFHDVLVHOHFWULFLW\RUWKHRUGLQDU\PDJQHWLVPRIWKH
ORGHVWRQHDQGLVJRYHUQHGE\PXFKWKHVDPHJHQHUDOODZVDQGUXOHV$QGOLNH
HOHFWULFLW\RURUGLQDU\PDJQHWLVPLWLVQRWFRQILQHGWRWKHSRLQWDWZKLFKLWLV
JHQHUDWHGEXWLQVWHDGLWPD\EHDQGLVGLIIXVHGWRSRLQWVEH\RQG,QRWKHU
ZRUGVWKHWKRXJKWHQHUJ\RIWKHEUDLQRIDSHUVRQH[WHQGVEH\RQGWKHOLPLWVRI
KLVEUDLQFUHDWHVDWKRXJKWDWPRVSKHUHDURXQGKLPDQGUHJLVWHUVDQHIIHFWXSRQ
WKHEUDLQVRIRWKHUVFRPLQJZLWKLQKLVILHOGRIHQHUJ\
7KHGLVFRYHU\RIUDGLRDFWLYLW\LQFHUWDLQQHZO\GLVFRYHUHGHOHPHQWVRI
PDWWHUQRWDEO\LQWKHFDVHRIUDGLXPKDVOHGVFLHQFHWRLQYHVWLJDWHWKHPDWWHURI
WKHSRVVLEOHUDGLRDFWLYLW\RIRWKHUVXEVWDQFHV7KHUHVXOWLVPRVWVXUSULVLQJIRU
DGYDQFHGVFLHQFHQRZDQQRXQFHVWKDWHYHU\VXEVWDQFHLVUDGLRDFWLYHWKDWLV
HYHU\VXEVWDQFHLVFRQVWDQWO\UDGLDWLQJHQHUJ\RIIRUFHIURPLWVHOI7KLV
GLVFRYHU\VHUYHVWRKDUPRQL]HWKHSUHYLRXVO\VHSDUDWHGIDFWVUHJDUGLQJ
WKRXJKWWUDQVIHUHQFHHWFDQGLWLVQRZDFFHSWHGDVDIDFWWKDWWKHKXPDQEUDLQLV
VWURQJO\UDGLRDFWLYHDQGLVFRQVWDQWO\VHQGLQJIRUWKVWUHDPVRIUDGLRHQHUJ\
7KHVDPHODZVZKLFKJRYHUQWKHUDGLXPDUHQRZSHUFHLYHGWRJRYHUQWKHEUDLQ
DFWLRQ7KLVVLPSOLILHVWKHPDWWHUDQGEULQJVWKHVXEMHFWRIWKRXJKWWUDQVIHUHQFH
LQWRWKHJHQHUDOILHOGRIVFLHQFHDQGRXWRIWKHUHDOPVRIP\VWLFLVP7KHVXEMHFW
LQWRWKHJHQHUDOILHOGRIVFLHQFHDQGRXWRIWKHUHDOPVRIP\VWLFLVP7KHVXEMHFW
LVQRZWDXJKWDQGVWXGLHGRQDVFLHQWLILFEDVLVLQWKHSULQFLSDOXQLYHUVLWLHVRI
WKHZRUOGDQGQHZGLVFRYHULHVDUHFRQVWDQWO\EHLQJPDGHUHJDUGLQJLW7KH
SK\VLFDOSROHRISHUVRQDOPDJQHWLVPLVQRWWREHIRXQGLQWKHIOHVKEORRGRU
ERQHVRIWKHERG\ȈIRUWKHVHDUHEXWWKHFUXGHPDFKLQHU\E\ZKLFKWKHKLJKHU
SDUWVRIWKHKXPDQRUJDQLVPPRYHVDQGDFWV,QVWHDGLWLVWREHIRXQGLQWKDW
PRVWZRQGHUIXOSDUWRUSDUWVRIWKHRUJDQLVPNQRZQDVWKHQHUYRXVV\VWHP
7KLVQHUYRXVV\VWHPLVMXVWDVZRQGHUIXOLQLWVZD\DVLVWKHEUDLQDQGLWVHIIHFWV
LQSHUVRQDOPDJQHWLVPDUHMXVWDVLPSRUWDQW
:HDUHVRDSWWRWKLQNRIWKHQHUYHVDVEHLQJDSDUWRIWKHERG\RIWKH
SHUVRQWKDWLWLVVRPHZKDWGLIILFXOWIRUXVWRJHWWKHLGHDWKDWWKHQHUYRXVV\VWHP
LVUHDOO\DVPXFKDSDUWRIWKHPHQWDOV\VWHPDVLVWKHEUDLQ,QIDFWWKHQHUYRXV
V\VWHPLVFRPSRVHGRIDOPRVWH[DFWO\WKHVDPHNLQGRIPDWWHUDVLVWKHEUDLQ
7KHQHUYRXVV\VWHPPRUHRYHUJHQHUDWHVHQHUJ\RIDNLQGYHU\VLPLODUWRWKDW
JHQHUDWHGE\WKHEUDLQ)RUWKDWPDWWHUDGYDQFHGVFLHQFHUHDOO\FRQVLGHUVWKDW
WKHEUDLQDQGQHUYRXVV\VWHPDUHEXWSDUWVRIRQHDQGWKHVDPHWKLQJJRYHUQHG
E\WKHVDPHJHQHUDOODZVDQGWREHFRQVLGHUHGLQFRQQHFWLRQZLWKHDFKRWKHU
$QGWKHVWXGHQWRISHUVRQDOPDJQHWLVPVRRQFRPHVWRDFFHSWWKLVYLHZZKHQKH
VHHVWKHLPSRUWDQWSDUWSOD\HGE\WKHJUHDWQHUYHFHQWHUVLQWKHZRUNRISHUVRQDO
PDJQHWLVP7KHUHIRUHDOWKRXJK,FDOOWKHPDJQHWLVPRIWKHQHUYRXVV\VWHPE\
WKHWHUPSK\VLFDODQGWKDWRIWKHEUDLQE\WKHWHUPPHQWDO,GRVRPHUHO\LQ
RUGHUWRPDNHDQHDV\OLQHRIGLVWLQFWLRQIRUWKHSXUSRVHRIWHDFKLQJDQGVWXG\
$WWKHODVWKRZHYHUWKH\DUHUHDOO\EXWSDUWVRIRQHDQGWKHVDPHWKLQJȈPHUHO\
WZRSROHVRIWKHVDPHVRXUFHRIHQHUJ\
7KHQHUYRXVV\VWHPRIWKHKXPDQEHLQJLVUHDOO\DPRVWLQWULFDWHPHFKDQLVP
,WVPDLQIHDWXUHLVWKHVSLQDOFRUGZKLFKUXQVDORQJDQRSHQLQJLQWKHVSLQDO
FROXPQRUEDFNERQHDQGZKLFKLVGLUHFWO\FRQQHFWHGZLWKWKHEUDLQPDWWHULQWKH
VNXOO)URPWKHVSLQDOFRUGHPHUJHPDQ\VHWVRIQHUYHVLQSDLUVZKLFKEUDQFK
RXWLQVPDOOHUILODPHQWWKHVHLQWXUQEUDQFKLQJRXWLQWRVWLOOVPDOOHUDQGVRRQ
XQWLOHDFKDQGHYHU\SDUWRIWKHERG\LVVXSSOLHGZLWKDGLUHFWFRQQHFWLRQZLWK
WKHPDLQQHUYHWUXQN2WKHUJUHDWFDEOHVRIQHUYHVGHVFHQGLQWRWKHWUXQNRIWKH
ERG\DSDUWIURPWKHVSLQDOFRUGV\VWHPDOWKRXJKFRQQHFWHGZLWKWKHODWWHUE\
QHUYHOLQNV,QGLIIHUHQWSDUWVRIWKHERG\DUHWREHIRXQGJUHDWPDVVHVRI
QHUYHVXEVWDQFHEHLQJPDWWHGNQRWVRUWDQJOHVRIQHUYHVWKHVHFHQWHUVEHLQJ
FDOOHGSOH[XVRUSOH[XVHVWKHSULQFLSDORQHEHLQJWKHVRODUSOH[XVZKLFKLV
VLWXDWHGULJKWEDFNRIWKHSLWRIWKHVWRPDFKDQGZKLFKSOD\VDYHU\LPSRUWDQW
SDUWLQWKHOLIHRIWKHSHUVRQVRLPSRUWDQWLQGHHGWKDWDVHYHUHEORZVWUXFN
GLUHFWO\RYHULWPD\FDXVHWKHGHDWKRIWKHSHUVRQ
7KHQHUYRXVV\VWHPQRWRQO\FRQYH\VPHVVDJHVIURPWKHGLIIHUHQWSDUWVRI
WKHERG\WRWKHEUDLQEXWDOVRVHUYHVWRFRQYH\WKHHQHUJ\RIPRWLRQWRWKH
WKHERG\WRWKHEUDLQEXWDOVRVHUYHVWRFRQYH\WKHHQHUJ\RIPRWLRQWRWKH
YDULRXVSDUWV,QVKRUWWKHUHFDQEHQRPRWLRQRIDQ\SDUWRIWKHERG\XQOHVVWKH
LPSXOVHFRPHVRYHUWKHQHUYHV:KHQWKHQHUYHVJRYHUQLQJDQ\SDUWRIWKHERG\
DUHSDUDO\]HGWKDWSDUWRIWKHERG\EHFRPHVGHYRLGRIPRWLRQ6R\RXVHHWKH
QHUYRXVV\VWHPLVDSDUWRIWKHJUHDWHQHUJ\SURGXFLQJV\VWHPRIWKHERG\ȈDV
PXFKDSDUWRILWDVLVWKHEUDLQ5HPHPEHUWKLVDOZD\VIRULWLVRQHRIWKHNH\V
WRWKHVHFUHWVRISHUVRQDOPDJQHWLVP
:KHQ\RXUHPHPEHUWKDWWKLVQHUYHHQHUJ\VSUHDGVLWVHOIEH\RQGWKHOLPLWV
RIWKHERG\MXVWDVGRHVWKHHQHUJ\RIWKHEUDLQWKHQ\RXPD\EHJLQWRVHHZKDW
,DPGULYLQJDWLQDQQRXQFLQJWKHVHFRQGSROHRUSKDVHRISHUVRQDOPDJQHWLVP
QDPHO\WKHSK\VLFDOSROHZKLFKLQUHDOLW\LVWKHSKDVHRIPDJQHWLVP
JHQHUDWHGDQGUDGLDWHGE\WKHQHUYRXVV\VWHPSDUWLFXODUO\E\LWVJUHDWFHQWHUVRI
SOH[XV,WKLQNWKDW\RXDUHQRZEHJLQQLQJWRJHWWKHLGHDDOWKRXJK,KDYH
FDUHIXOO\DYRLGHGWHFKQLFDOVFLHQWLILFWHUPVDQGKDYHH[SUHVVHGP\VHOILQWKH
VLPSOHVWIRUP
&KDSWHU
7KH0HQWDO3KDVH
7DEOHRI&RQWHQW

7KHPHQWDOSKDVHRISHUVRQDOPDJQHWLVPGHSHQGVXSRQWZRFRRUGLQDWHG
PDQLIHVWDWLRQVRIPHQWDOSRZHUDVIROORZV
 WKHKROGLQJRIFHUWDLQPHQWDOVWDWHVXQWLOWKHPHQWDODWPRVSKHUHEHFRPHV
FKDUJHGZLWKWKHYLEUDWLRQVRIWKHSDUWLFXODUPHQWDOVWDWHVDQG
 WKHFRQVFLRXVSURMHFWLRQRIWKHPHQWDOFXUUHQWIURPWKHEUDLQFHQWHUVE\
WKHDFWLRQRIWKHZLOORIWKHLQGLYLGXDO
,VKDOOQRZSURFHHGWRGHVFULEHWKHVHWZRPHQWDOSKDVHVRIPDQLIHVWDWLRQLQ
GHWDLO
,WLVDIDFWNQRZQWRDOOVWXGHQWVRIWKHVXEMHFWWKDWWKHFKDUDFWHURIWKH
PHQWDODWPRVSKHUHRIDQ\LQGLYLGXDOGHSHQGVHQWLUHO\XSRQWKHFKDUDFWHURIWKH
PHQWDOVWDWHVKHOGE\KLP7KHPHQWDODWPRVSKHUHRIWKHKRSHIXOH[SHFWDQW
LQGLYLGXDOLVFRPSRVHGRIYLEUDWLRQVRIDKRSHIXOFKHHUIXOFKDUDFWHUZKLFKWHQG
WRLPSUHVVDQGDIIHFWRWKHUSHUVRQVFRPLQJZLWKLQWKHILHOGRIDFWLYLW\RIKLV
SHUVRQDODWPRVSKHUH/LNHZLVHWKHPHQWDODWPRVSKHUHRIWKHJORRP\GHSUHVVHG
LQGLYLGXDOLVFRPSRVHGRIYLEUDWLRQVRIDJORRP\GHSUHVVLQJFKDUDFWHUZKLFK
LPSUHVVHVDQGDIIHFWVLQGLYLGXDOVFRPLQJLQFRQWDFWWKHUHZLWK$QGLQWKHVDPH
PDQQHUDOORIRQH VPHQWDOVWDWHVZLOOEHFRPHPDQLIHVWLQKLVPHQWDO
DWPRVSKHUHDQGDFFRUGLQJO\ZLOODIIHFWWKRVHZLWKZKRPKHFRPHVLQFORVH
FRQWDFW
7KHWUXWKRIWKHDERYHVWDWHPHQWVZLOOEHFRPHDSSDUHQWWRDQ\RQHZKRZLOO
JLYHWKHPDWWHUDPRPHQW VFDUHIXOFRQVLGHUDWLRQUHPHPEHULQJDWWKHVDPHWLPH
WKHLPSUHVVLRQVFUHDWHGXSRQKLPZKHQKHKDVFRPHLQFRQWDFWZLWKGLIIHUHQW
LQGLYLGXDOV+HZLOOUHPHPEHUWKDWVRPHLQGLYLGXDOVKDYHOHIWXSRQKLPWKH
LPSUHVVLRQRIJORRPLQHIILFLHQF\IDLOXUHHWF2WKHUVKDYHOHIWZLWKKLPD
IHHOLQJRIVXVSLFLRQGLVWUXVWDQGXQHDVLQHVV2WKHUVVWLOOKDYHJLYHQKLPWKH
LPSUHVVLRQRIFKHHUIXOQHVVIULHQGOLQHVVFRQILGHQFHDQGJRRGZLOO
7KHDWPRVSKHUHRIVRPHSHUVRQVLVVXFKWKDWLWFDXVHVXVWROHWWKHPDORQH
DQGWRWDNHQRVWRFNZKDWVRHYHULQWKHLUEXVLQHVVSURSRVLWLRQV2WKHUVLQVWHDG
LPEXHXVZLWKFRQILGHQFHDQGWUXVWDQGJLYHXVWKHIHHOLQJWKDWZHZRXOGOLNHWR
GREXVLQHVVZLWKWKHP6RPHSHUVRQVOHDYHXSRQXVWKHLPSUHVVLRQVWKDWZH
KDYHEHHQLQWKHSUHVHQFHRIDVQDN\WKLQJDQGZHRIWHQFDQVFDUFHO\UHSUHVVD
VKXGGHURIGLVJXVWDQGGLVOLNHZKLOHRWKHUVFUHDWHLQXVWKHLPSUHVVLRQWKDWWKH
VKXGGHURIGLVJXVWDQGGLVOLNHZKLOHRWKHUVFUHDWHLQXVWKHLPSUHVVLRQWKDWWKH
RWKHUSHUVRQLVDJRRGIULHQGDQGFDQEHGHSHQGHGXSRQDVDKHOSHUDQGFRPUDGH
:K\"
,WLVQRWIURPDQ\WKLQJWKHVHSHUVRQVKDYHVDLGIRUDVZHDOONQRZVRPHRI
WKHVOLSSHULHVWSHUVRQVDUHRIWHQWKHEHVWDQGVPRRWKHVWWDONHUVDQGVRPHRIWKH
EHVWDQGPRVWGHSHQGDEOHSHUVRQVDUHRIWHQYHU\UHWLFHQWDQGHYHQVKRUWLQ
VSHHFK7KHUHDVRQOLHVGHHSHUWKDWZRUGV,WLVWKHIHHOLQJWKDWZHH[SHULHQFH
ZKHQZHFRPHLQFRQWDFWZLWKSHUVRQVUDWKHUWKDQDQ\UHSRUWRIWKHUHDVRQ
UHJDUGLQJWKHP$QGWKLVIHHOLQJLVFDXVHGE\WKHUHJLVWU\XSRQRXUVHQVLWLYH
EUDLQRUJDQLVPRIWKHWKRXJKWYLEUDWLRQVRIWKHRWKHUSHUVRQ VSHUVRQDO
DWPRVSKHUH1RWRQO\DUHWKHVHWKLQJVQRWLFHGLQWKHSHUVRQKLPVHOIRUKHUVHOI
EXWHYHQWKHYHU\UHVLGHQFHVVWRUHVRURWKHUSODFHVIUHTXHQWHGE\WKHLQGLYLGXDO
DUHDOVRDIIHFWHGE\WKHFRQWLQXRXVLQIOXHQFHRIWKHWKRXJKWYLEUDWLRQVRIKLVRU
KHUSHUVRQDODWPRVSKHUH'LG\RXHYHUQRWLFHKRZVRPHKRXVHVSURGXFHXSRQ
\RXDIHHOLQJRIVDGQHVVRUZRHRUZRUVHZKLOHRWKHUVVHHPWRFDUU\ZLWKLQ
WKHPDQDLURIKHDOWKDQGJRRGFKHHUKDSSLQHVVDQGFRQWHQW"7KLVLVRIWHQWUXH
DOWKRXJKWKHKRXVHPD\KDYHEHHQXQRFFXSLHGIRUVRPHWLPH6RVWURQJGRWKH
PHQWDOYLEUDWLRQVRIWKHDWPRVSKHUHRIWKHSHUVRQRUSHUVRQVIRUPHUO\LQKDELWLQJ
WKHP,QWKHVDPHZD\VRPHRIILFHVDQGSODFHVRIEXVLQHVVDUHVRVDWXUDWHGZLWK
WKHYLEUDWLRQVRIWKHSHUVRQDODWPRVSKHUHVRIWKHLURFFXSDQWVWKDWRQHLVIRUFLEO\
LPSUHVVHGE\WKHVDPHXSRQHQWHULQJWKHGRRU$PDQPD\GLVJXLVHKLVWKRXJKWV
E\KLVZRUGVRUKLVIDFLDOH[SUHVVLRQEXWWKHPHQWDOYLEUDWLRQVRIKLVSHUVRQDO
DWPRVSKHUHZLOOIUHTXHQWO\JLYHKLPDZD\
7KHVHDUHIDFWVZKLFKVKRXOGUHTXLUHQRIXUWKHUSURRIȈ\RXURZQH[SHULHQFH
VKRXOGEHSURRIHQRXJKWRVDWLVI\\RXEXW\RXVKRXOGPDNHPHQWDOQRWHRIWKLV
IDFWDQGFDUU\LWLQPLQGDVZHSURFHHG0DQ\SHUVRQVOHDYHEXWOLWWOH
LPSUHVVLRQXSRQXVIRUWKHUHDVRQVWKDWWKHLUPHQWDOVWDWHVDUHVRYDULHG
LQFRQVWDQWDQGIOHHWLQJWKDWWKH\QHXWUDOL]HHDFKRWKHUDQGIDLOWRLPSDUWD
GHILQLWHVKDGHRIWKRXJKWFRORUWRWKHSHUVRQDODWPRVSKHUH7KHVWURQJHVW
SHUVRQDODWPRVSKHUHVDUHWKRVHRISHUVRQVRIVWURQJIHHOLQJVGHVLUHVDQG
HPRWLRQVJRRGRUEDGIRUVXFKKDYHVWURQJDQGFRQVWDQWPHQWDOVWDWHVZKLFK
LPSUHVVWKHPVHOYHVIRUFLEO\XSRQWKHLUSHUVRQDODWPRVSKHUHVRVWURQJO\LQIDFW
WKDWRQHZKRQRWLFHVWKHVHWKLQJVFDQQRWIDLOWRSHUFHLYHWKHP
$PRPHQWVWKRXJKWZLOOLQIRUP\RXWKDWLIWKHVHWKLQJVEHWUXHȈDQGWUXH
\RXZLOOUHDOL]HWKH\PXVWEHZKHQ\RXJLYHWKHPDWWHUDPRPHQWV FDUHIXO
WKRXJKWȈWKHQRQHVKRXOGEHYHU\FDUHIXOWRDYRLGKDUERULQJPHQWDOVWDWHVRID
FKDUDFWHUOLNHO\WRLQVSLUHXQGHVLUDEOHIHHOLQJVLQRWKHUSHUVRQV$QGDWWKHVDPH
WLPHRQHVKRXOGHQGHDYRUWRFXOWLYDWHPHQWDOVWDWHVRIDFKDUDFWHUOLNHO\WR
DZDNHQIHHOLQJVRIDGHVLUDEOHFKDUDFWHULQWKRVHZLWKZKRPZHFRPHLQFRQWDFW
,QIDFWDJUHDWSRUWLRQRIWKHIROORZLQJFKDSWHUVZLOOEHXVHGWRWHDFKKRZWR
FXOWLYDWHMXVWVXFKPHQWDOVWDWHVVRDVWRUDWHWKHGHVLUHGHIIHFWXSRQRWKHUVIRULQ
FXOWLYDWHMXVWVXFKPHQWDOVWDWHVVRDVWRUDWHWKHGHVLUHGHIIHFWXSRQRWKHUVIRULQ
WKLVOLHVRQHRIWKHJUHDWVHFUHWVRISHUVRQDOPDJQHWLVP
2QHQHHGQRWGHVSDLULIKHKDVEHHQFUHDWLQJDQGFDUU\LQJDURXQGZLWKKLPD
SHUVRQDODWPRVSKHUHRIDQXQGHVLUDEOHNLQG)RUWKHVHWKLQJVPD\EHUHPHGLHG
DQGRQHPD\HQWLUHO\FKDQJHWKHFKDUDFWHURIKLVPHQWDOVWDWHVDQGWKXV
WUDQVIRUPKLVSHUVRQDODWPRVSKHUHIURPWKHYHU\ZRUVWWRWKHYHU\EHVW7KHVH
WKLQJVUHTXLUHZRUNSHUVHYHUDQFHDQGSDWLHQFHLWLVWUXHEXWWKHUHZDUGLVVR
JUHDWWKDWLWSD\VDQ\RQHWRGHYRWHKLVDWWHQWLRQVDQGWLPHWRLW7KHSULQFLSOHLV
YHU\VLPSOHLQGHHGEXWLWUHTXLUHVGHWHUPLQDWLRQDQGGRJJHGZLOOWRREWDLQWKH
EHVWUHVXOWVSDUWLFXODUO\LQFDVHVZKHUHYHU\XQGHVLUDEOHFRQGLWLRQVKDYHH[LVWHG
7KHVHFRQGZD\LQZKLFKWKHPHQWDOSKDVHRISHUVRQDOPDJQHWLVPRSHUDWHV
LHWKDWRIWKHFRQVFLRXVSURMHFWLRQRIWKHPHQWDOFXUUHQWVIURPWKHEUDLQ
FHQWHUVE\WKHDFWLRQRIWKHZLOORIWKHLQGLYLGXDODOVRGHPDQGVZRUNRQWKHSDUW
RIWKHVWXGHQWZKRZLVKWRFUHDWHDVWURQJSHUVRQDODWPRVSKHUH
7KHSULQFLSOHRIWKLVVHFRQGIRUPRIPHQWDODFWLRQFRQVLVWVLQWKHXVHRIWKH
ZLOOLQDFRQVFLRXVSURMHFWLRQRIWKRXJKWFXUUHQWV7KLVLVWUXHLQWKHFDVHRI
VWLPXODWLQJWKHSHUVRQDODWPRVSKHUHDQGDOVRLQFDVHVLQZKLFKRQHHQGHDYRUVWR
SURGXFHDQHIIHFWXSRQWKHPLQGRIVRPHRWKHUSHUVRQLQZKRVHSUHVHQFHKHPD\
KDSSHQWREH
:KLOHLWLVWUXHWKDWWKHFKDUDFWHURIWKHPHQWDOVWDWHVRIWKHSHUVRQZLOOFRORU
DQGJLYHFKDUDFWHUWRKLVSHUVRQDODWPRVSKHUHZKLFKZLOORIFRXUVHSURGXFHDQ
HIIHFWXSRQWKHRWKHUSHUVRQRUSHUVRQVLQKLVILHOGRIDFWLRQLWLVOLNHZLVHWUXH
WKDWWKHHIIHFWRIVXFKPHQWDOYLEUDWLRQVPD\EHHQRUPRXVO\LQFUHDVHGE\WKHXVH
RIWKHZLOOLQWKHGLUHFWLRQRIWKHFRQVFLRXVSURMHFWLRQMXVWUHIHUUHGWR7KH
PHQWDOVWDWHVSURGXFHDQGFUHDWHWKHPHQWDODWPRVSKHUHLWLVWUXHEXWWKHZLOO
VHUYHVWRSURMHFWWKHPIRUWKZLWKIRUFHDQGWRJHQHUDOO\HQHUJL]HWKHDWPRVSKHUH
DQGLQFUHDVHWKHHIIHFW
,WLVMXVWDVLI\RXKDGFUHDWHGDJUHDWVWRUHRIPHQWDOPDJQHWLVPLQ\RXU
EUDLQDQGJLYHQLWWKHSURSHUTXDOLW\DQGFRORUE\WKHFKDUDFWHURI\RXUPHQWDO
VWDWHV7KLVZRXOGQDWXUDOO\FUHDWHDSHUVRQDODWPRVSKHUHRUDXUDDURXQG\RX
ZKLFKZRXOGEHIHOWE\RWKHUV%XWWKHQLPDJLQHWKHLQFUHDVHGVWUHQJWKDQGHIIHFW
WKDWZRXOGDULVHIURPWKHXVHRI\RXUZLOOWRSURMHFWDQGIRUFHRXWZDUGIURP\RXU
EUDLQWKHVHPHQWDOYLEUDWLRQV<RXZLOOVHHDWRQFHKRZVXFKDQDFWLRQRIWKH
ZLOOZRXOGWHQGWRHQHUJL]HDQGLQFUHDVHWKHYLEUDWLRQVRI\RXUPHQWDO
DWPRVSKHUHFDQ\RXQRW",WZRXOGEHOLNHWXUQLQJRQDQH[WUDIRUFHRIWKHSRZHU
ZRXOGLWQRW"&HUWDLQO\LWZRXOGDQG\RXPD\JDLQWKLVHIIHFWZKHQHYHU\RX
ZLVKWRGRVRE\XVLQJWKHPHWKRGVZKLFKZLOOEHJLYHQ\RXLQWKLVERRNDVZH
SURFHHG
$JDLQ\RXZLOOVHHE\DOLWWOHWKRXJKWKRZPXFKVWURQJHUZLOOEHWKHHIIHFW
XSRQDQ\VSHFLDOLQGLYLGXDOLILQDGGLWLRQWRWKHYLEUDWLRQVRIRXUSHUVRQDO
XSRQDQ\VSHFLDOLQGLYLGXDOLILQDGGLWLRQWRWKHYLEUDWLRQVRIRXUSHUVRQDO
DWPRVSKHUHZHDGGWKHIRUFHRIDVSHFLDOFXUUHQWRIPHQWDOIRUFHGLUHFWHG
VWHDGLO\DQGSRLQWHGO\DWKLVPLQGE\DQHIIRUWRIRXUZLOO'R\RXVHHWKHSRLQW"
<RXILUVWDIIHFWKLPE\WKHHIIHFWRI\RXUHQHUJL]HGSHUVRQDODWPRVSKHUHDQG
WKHQMXVWZKHQKHLVLQWKHSURSHUUHFHSWLYHFRQGLWLRQ\RXGLVFKDUJHDWKLPD
SV\FKLFULIOHEDOOZKLFKKLWVKLPULJKWLQWKHEXOO VH\HRIKLVPLQGZLWKHQRUPRXV
IRUFH
$WILUVWWKRXJKWWKLVPD\VHHPWR\RXOLNHYHU\VWUHQXRXVSURFHHGLQJVDQG
RQHZKLFKZRXOGUHTXLUHWKHRXWOD\RIDJUHDWDPRXQWRIZLOOSRZHURQ\RXURZQ
SDUW%XWWKLVLVQRWVRIRUWKHWKRXJKWFXUUHQWVDUHYHU\UHVSRQVLYHWRWKHDFWLRQ
RIWKHZLOODQGWKHPDLQWKLQJLVWRKROGWKHZLOOILUPO\WRWKHWDVNDQGWKH
WKRXJKWFXUUHQWVZLOOIORZRXWRYHUWKHFKDQQHOWKXVPDGHIRUWKHP,WLVOLNH
KROGLQJDULIOHSURSHUO\DLPHGDQGWKHQOHWWLQJWKHIRUFHRIWKHSRZGHUGULYHWKH
EXOOHWKRPHRUDJDLQOLNHKROGLQJWKHQR]]OHRIDKRVHSRLQWHGH[DFWO\ZKHUH
\RXZLVKWKHFXUUHQWRIZDWHUWRJRDQGOR:KHQWKHZDWHULVWXUQHGRQLWIOLHV
VWUDLJKWWRWKHPDUNORQJDIWHULWKDVOHIWWKHWLSRIWKHQR]]OHRIWKHKRVH
7KHVWURQJPHQRIDOOWLPHVKDYHHPSOR\HGWKHZLOOLQWKLVZD\LQWKH
GLUHFWLRQRIFUHDWLQJDVWURQJSHUVRQDODWPRVSKHUHDQGDOVRLQWKHGLUHFWLRQRI
SURGXFLQJVWURQJLPSUHVVLRQVXSRQWKRVHZKRWKH\ZLVKHGWRDIIHFW,QPDQ\
FDVHVWKH\KDYHQRWIXOO\XQGHUVWRRGWKHFKDUDFWHURIWKHIRUFHVVHWLQWRRSHUDWLRQ
E\WKHPVHOYHVEXWWKH\XQGHUVWRRGWKHKRZSDUWHYHQLIWKH\GLGQRWJUDVSWKH
ZK\7KHQH[WWLPH\RXFRPHLQWRFRQWDFWZLWKDVWURQJLQGLYLGXDOZDWFKKLP
RUKHUDQGVHHLI\RXFDQQRWDOPRVWVHHWKHRSHUDWLRQRIWKLVGLUHFWLRQRIPHQWDO
IRUFHRIZKLFK,KDYHMXVWVSRNHQ%XWIDUPRUHLPSRUWDQWWKDQHYHQVWXG\LQJ
RWKHUVLVWKDWRIFXOWLYDWLQJWKHDUWRIGRLQJWKHWKLQJIRU\RXUVHOIDQGWKLVLV
ZKDW,DPWU\LQJWRWHDFK\RXWRGR$QG\RXZLOOVXFFHHGLQLWWRRLI\RXZLOO
HQWHULQWRWKHZRUNIXOO\ZLWKKHDUWDQGPLQG*HWLQHDUQHVWDERXWLWDQGWKH
SRZHUZLOOGHYHORSLQ\RXWREULQJDERXWVXFFHVV
&KDSWHU
7KH3K\VLFDO3KDVH
7DEOHRI&RQWHQW

7KHSK\VLFDOSKDVHRISHUVRQDOPDJQHWLVPGHSHQGVXSRQWZRFRRUGLQDWHG
PDQLIHVWDWLRQVRIQHUYHIRUFHDVIROORZV
 WKHJHQHUDWLRQZLWKLQWKHQHUYRXVV\VWHPRIDSOHQWHRXVVXSSO\RI
QHUYHIRUFHDQG
 WKHFRQVFLRXVSURMHFWLRQE\WKHZLOORIWKDWVXSSO\RIQHUYHIRUFHLQWRWKH
SHUVRQDODWPRVSKHUHDQGHYHQWRDJUHDWHUGLVWDQFHXQGHUVSHFLDOFRQGLWLRQV
%\QHUYHIRUFHDVXVHGLQWKHDERYHSDUDJUDSK,PHDQWKDWVWUDQJH
P\VWHULRXVIRUPRIHQHUJ\ZKLFKFRQWUROVDOOSK\VLFDOPRYHPHQWVDQG\HWDW
WKHVDPHWLPHDSSHDUVWREHVRPHWKLQJKLJKHUWKDQSK\VLFDOLWVHOI,WLVDNLQWR
HOHFWULFLW\RUPDJQHWLVPLQLWVUHDOQDWXUHDQGOLNHWKHVHIRUFHVLVLPSRVVLEOHWR
GHILQH1HUYHIRUFHLVVRPHWKLQJIDUGLIIHUHQWIURPWKHPDWWHURIZKLFKWKH
QHUYRXVV\VWHPLVFRPSRVHG7KHQHUYRXVV\VWHPIURPVSLQDOFRUGWRWKHPRVW
GHOLFDWHQHUYHILODPHQWLVDWWKHEHVWEXWDV\VWHPRIZLUHVUHOD\VHWFRYHU
ZKLFKWKHQHUYHIRUFHWUDYHOVRUHOVHFRPSOLFDWHGUHVHUYRLUVLQZKLFKWKH
QHUYHIRUFHLVVWRUHG
7KHRUGLQDU\QHUYHVVHUYHDVZLUHVDQGFDEOHVRYHUZKLFKWKHQHUYHIRUFH
WUDYHOVWRPRYHWKHSDUWVRIWKHERG\ZKLFKZHZLOOWRPRYHRUZKLFKRXU
VXEFRQVFLRXVPHQWDOLW\GHVLUHVWRPRYH&HUWDLQSDUWVRIWKHEUDLQDUHJUHDW
UHVHUYRLUVRIQHUYHIRUFHDVDUHDOVRWKHJUHDWJURXSVRIQHUYHPDWWHUFDOOHGWKH
SOH[XVSURPLQHQWDPRQJZKLFKDUHWKHVRODUSOH[XVDQGWKHVDFUDOSOH[XV
7KHRUGLQDU\WH[WERRNVRISK\VLRORJ\SDVVRYHUWKHTXHVWLRQRIWKHUHDO
QDWXUHRIQHUYHIRUFHIRUWKHLUZULWHUVGRQRWSRVVHVVWKHVHFUHW7KH\GLVSRVHRI
WKHTXHVWLRQE\VD\LQJ$VLQWKHFDVHRIHOHFWULFLW\ZKLOHZHIXOO\UHFRJQL]HLWV
H[LVWHQFHDQGLWVSRZHUQHYHUWKHOHVVZHGRQRWNQRZLWVUHDOQDWXUH$QGVR
WKHVWXGHQWPXVWJREDFNWRVRPHRIWKHROGRFFXOWZULWHUVRIWKHSDVWDJHVDQG
WKHLUIROORZHUVLQWKHSUHVHQWDJHLQRUGHUWRJHWWKHVHFUHW
$OORFFXOWLVWVDQFLHQWDQGPRGHUQKDYHUHFRJQL]HGWKHH[LVWHQFHRID
PLJKW\VXEWOHIRUFHRIQDWXUHȈRQHRIQDWXUH VILQHUIRUFHVȈZKLFKLVPRVW
SRWHQWLWLWVHIIHFWVDQGDFWLYLWLHVEXWZKLFKQHYHUWKHOHVVGHILHGDOOSRZHURI
DQDO\VLVRUGHILQLWLRQ7KHUHDVRQWKDWVFLHQFHKDVQHYHUEHHQDEOHWRFODVVLI\
QHUYHIRUFHLVEHFDXVHOLNHHOHFWULFLW\LWLVLQDFODVVE\LWVHOIDQGLVGLIIHUHQW
IURPDQ\RWKHUIRUPRIIRUFHȈVRGLIIHUHQWWKDWLWFDQQRWEHFODVVLILHGZLWKRWKHU
IRUFHV6FLHQFHLQVRPHFDVHVKDVHQGHDYRUHGWRWUHDWLWDVDVHFUHWLRQRIWKH
QHUYRXVPDWWHUEXWWKDWLVDIROO\DNLQWRWKDWRIWKHPDWHULDOLVWLFSKLORVRSKHU
ZKRWULHGWRGHILQHPLQGDVDVHFUHWLRQRIWKHEUDLQMXVWDVWKHELOHLVD
VHFUHWLRQRIWKHOLYHUWKHJDOODVHFUHWLRQRIWKHJDOOEODGGHUHWF6XFKDWWHPSWVDW
GHILQLWLRQFDXVHRQO\DVPLOHRQWKHIDFHRIWKHZLVH
7KHRFFXOWLVWVRQWKHFRQWUDU\ZKLOHQRWDWWHPSWLQJWRGHILQHQHUYHIRUFH
UHFRJQL]LQJLWWREHLQDFODVVRILWVRZQ QHYHUWKHOHVVKDYHGLVFRYHUHGWKH
VRXUFHRILWVRULJLQDQGKDYHJLYHQXVYDOXDEOHLQIRUPDWLRQDVWRLWVXVH7KH\
KDYHJLYHQLWPDQ\QDPHVDVIRULQVWDQFHYLWDOIRUFHYLWDOHQHUJ\OLIH
IRUFHYLWDOIOXLGYLWDOPDJQHWLVPHWFDQGLQWKHFDVHRIWKH2ULHQWDOVWKH
WHUPVSUDQDRUDNDVKLFHQHUJ\KDYHEHHQDSSOLHGWRLW%XWXQGHUDOORIWKHVH
GLIIHUHQWQDPHVWKHRFFXOWLVWVKDYHDOZD\VPHDQWWKHRQHDQGVDPHWKLQJLH
QHUYHIRUFH7KHQDPH,XVHLQGHVFULELQJLW QHUYHIRUFHLVHPSOR\HGVLPSO\
EHFDXVHLWLVIRXQGVSHFLDOL]HGLQWKHQHUYRXVV\VWHPDQGQRWEHFDXVHRIDQ\
LGHDWKDWLWRULJLQDWHVWKHUH,QGHHGDV\RXVKDOOVHHLQDPRPHQWLWKDVDIDU
KLJKHUDQGPRUHHOHPHQWDU\VRXUFHRIRULJLQ
7KHROGPDWHULDOLVWLFVFKRRORISK\VLRORJ\KDVDWWHPSWHGWRVKRZWKDW
QHUYHIRUFHOLNHWKHERGLO\PDWHULDOLVGHULYHGIURPWKHIRRGZHHDWDQGLV
FUHDWHGE\FKHPLFDOFRPEXVWLRQRIWKHODWWHU7KLVKRZHYHULVRQO\SDUWO\WUXH
:KLOHLWLVWUXHWKDWWKHUHLVDFHUWDLQDPRXQWRIQHUYHIRUFHLQIUHVKIRRG KDYLQJ
EHHQJDWKHUHGWKHUHGXULQJWKHOLIHRIWKHSODQWRIDQLPDORIZKLFKWKHIRRG
IRUPHGDSDUW DQGZKLOHLWLVWUXHWKDWDFHUWDLQDPRXQWRIWKLVQHUYHIRUFHLV
WDNHQXSE\WKHV\VWHPRIWKHSHUVRQHDWLQJWKHIRRGSDUWLFXODUO\LIWKHIRRGEH
IUHVKQHYHUWKHOHVVWKHDPRXQWRIQHUYHIRUFHVRDEVRUEHGLVFRPSDUDWLYHO\
VPDOODQGLVIDUWRROLWWOHWRVXSSO\ZKDWLVQHHGHGE\WKHLQGLYLGXDOWRUXQKLV
SK\VLFDORUJDQLVP$QGHYHQWKHVPDOOSDUWVRREWDLQHGLVQRWGHULYHGIURPWKH
FKHPLFDOFRPEXVWLRQRIWKHIRRG)RRGFKHPLFDOFRPEXVWLRQUHVXOWVLQJLYLQJ
ERGLO\KHDWEXWQHYHULQFUHDWLQJQHUYHIRUFH
7KHWUXHVRXUFHRIQHUYHIRUFHLVWKHVDPHDVWKHVRXUFHRIHOHFWULFLW\QDPHO\
WKHXQLYHUVDOHWKHUWKDWILOOVVSDFH/LNHHOHFWULFLW\DOVRWKLVIRUFHLVDYDLODEOHWR
KXPDQZDQWVRQO\ZKHQLWLVDVVRFLDWHGZLWK7KHDWPRVSKHUHLVFKDUJHGZLWK
QHUYHIRUFHZKLFKLVWDNHQXSDQGDEVRUEHGE\WKHQHUYRXVV\VWHPDQGVWRUHG
DZD\LQLWVJUHDWUHVHUYRLUVIURPZKHQFHLQWXUQLWIORZVRYHUWKHQHUYHVZKHQ
UHTXLUHGE\WKHSK\VLFDORUPHQWDOQHHGVRIWKHLQGLYLGXDO
%XW\RXQDWXUDOO\DVNKRZGRHVWKHERG\DEVRUEWKHXQLYHUVDOQHUYHIRUFHȈ
WKURXJKZKDWFKDQQHOGRHVLWHQWHUWKHV\VWHP7KHDQVZHULVSODLQYL],QSODQW
DQLPDODQGKXPDQOLIHWKHQHUYHIRUFHLVEUHDWKHGLQWRWKHV\VWHP,QRWKHU
ZRUGVWKHSURFHVVRIEUHDWKLQJLQLWVKLJKHUDQGORZHUIRUPVLVQRWDORQHWKDW
RIH[WUDFWLQJR[\JHQRURWKHUHOHPHQWVIURPWKHDLUEXWDOVRWKDWRIH[WUDFWLQJ
RIH[WUDFWLQJR[\JHQRURWKHUHOHPHQWVIURPWKHDLUEXWDOVRWKDWRIH[WUDFWLQJ
WKHXQLYHUVDOQHUYHIRUFHDWWKHVDPHWLPH:KHQWKLVLVXQGHUVWRRGLWZLOOEH
PRUHHDVLO\XQGHUVWRRGZK\WKHOLYLQJWKLQJSHULVKHVVRVRRQLIWKHSURFHVVRI
EUHDWKLQJEHLQWHUIHUHGZLWK7KHXQGHUVWDQGLQJRIWKLVVHFUHWRIQDWXUHWKURZVD
PXFKQHHGHGOLJKWXSRQWKHLPSRUWDQWSDUWSOD\HGE\EUHDWKLQJLQWKHOLIHRIDOO
FUHDWXUHV
%HIRUHSURFHHGLQJWRDIXUWKHUFRQVLGHUDWLRQRIWKHSURFHVVRIWKHDEVRUSWLRQ
RIQHUYHIRUFHIURPWKHDWPRVSKHUHHVSHFLDOO\LQWKHFDVHRIWKHVWXGHQWRI
SHUVRQDOPDJQHWLVP,DVN\RXWRFRQVLGHUDQRWKHULPSRUWDQWTXHVWLRQLQUHODWLRQ
WRWKHSK\VLFDOSKDVHRISHUVRQDOPDJQHWLVPQDPHO\WKDWRIWKHSURMHFWLRQRI
QHUYHIRUFHEH\RQGWKHOLPLWVRIWKHQHUYRXVV\VWHP<RXZLOOUHPHPEHUWKDWWKH
DYHUDJHSK\VLRORJLVWPDLQWDLQVWKDWLWLVIROO\WRKROGWKDWQHUYHIRUFHFDQ
SRVVLEO\SDVVEH\RQGWKHOLPLWVRIWKHQHUYRXVV\VWHPFRQWDLQLQJLW+HKROGV
WKDWOLNHHOHFWULFLW\RQWKHZLUHVLWFDQQRWSDVVH[FHSWRYHUWKHZLUHVRIWKH
QHUYHV%XWLVWKLVWUXHHYHQRIHOHFWULFLW\",SRVLWLYHO\DVVHUWWKDWLWLVQRW7KH
YHULHVWQRYLFHLQWKHVWXG\RIHOHFWULFLW\LVDZDUHWKDWHOHFWULFLW\ZLOORIWHQOHDS
IURPRQHFRQGXFWLQJVXEVWDQFHWRDQRWKHUȈMXPSLQJWKHJDSLQWKHVKDSHRID
VSDUNȈDQGWKHQIO\LQJDORQJWKHQHZFKDQQHO$JDLQHYHQZLWKRXWWKHVSDUN
HOHFWULFLW\DQGPDJQHWLVPZLOORIWHQDIIHFWRWKHUVXEVWDQFHVE\ZKDWLVNQRZQDV
LQGXFWLRQZLWKRXWWKHDFWXDOFRQWDFWRIWKHWZRFRQGXFWLQJPDWHULDOV7KLVLV
VRFRPPRQWKDWLWLVDZRQGHUWKDWWKHTXHVWLRQLVHYHUUDLVHG$QGZKDWLVWUXH
RIHOHFWULFLW\DQGPDJQHWLVPLQWKLVUHVSHFWLVOLNHZLVHWUXHRIQHUYHIRUFHIRULW
ZLOOQRWRQO\RIWHQOHDSRYHUWKHEDUULHUVRIWKHQHUYRXVV\VWHPEXWZLOODQG
FRQVWDQWO\GRHVDIIHFWRWKHUQHUYRXVV\VWHPVE\DNLQGRILQGXFWLRQ
1RWRQO\LVWKHSKHQRPHQDRISHUVRQDOPDJQHWLVPDSURRIRIWKLV
WUDQVPLVVLRQRIQHUYHIRUFHEXWWKHSKHQRPHQDRI KXPDQPDJQHWLVP DVLWKDV
EHHQFDOOHG LQWKHGLUHFWLRQRIPDJQHWLFKHDOLQJDQRWKHUSURRIȈDSURRI
PRUHRYHUWKDWPD\EHREWDLQHGE\DQ\LQGLYLGXDOLQKLVRZQH[SHULHQFH
0RUHRYHUWKHH[SHULHQFHRIHYHU\LQGLYLGXDOZLOOEHDUDPSOHDQGJHQHURXV
WHVWLPRQ\WRWKHIDFWWKDWFHUWDLQSHUVRQVIORZLQJRYHUZLWKYLJRURXVQHUYHIRUFH
ZLOOVRUDGLDWHWKHHQHUJ\WKDWLWLVDFWXDOO\SHUFHSWLEOHWRWKRVHVKDNLQJKDQGV
ZLWKWKHPRUHYHQFRPLQJLQWRWKHLUYLFLQLW\7KHVHLQGLYLGXDOVIDLUO\UDGLDWH
KHDOWKDQGYLJRUDQGH[HUWDSRVLWLYHKHDOLQJDQGLQYLJRUDWLQJHIIHFWRQWKRVH
ZLWKZKRPWKH\FRPHLQFRQWDFW,QDVLPLODUPDQQHULVPDQLIHVWHGDODFNRI
VXIILFLHQWQHUYHIRUFHE\WKRVHXQIRUWXQDWHLQGLYLGXDOVZKRJRDURXQG
XQFRQVFLRXVO\DEVRUELQJWKHQHUYHIRUFHRIRWKHUVDQGLQH[WUHPHFDVHV
EHFRPLQJDFWXDOYDPSLUHVVXFNLQJWKHYLWDOIRUFHVIURPWKRVHDURXQGWKHP:KR
RI\RXKDYHQRWPHWWKLVODVWFODVVRISHUVRQVDQGKDYHQRWQRWHGKRZGHSUHVVHG
DQGZHDNHQHGRQHLVDIWHUKDYLQJEHHQLQWKHFRPSDQ\RIVXFKSHUVRQVIRUVRPH
WLPH"7KHDYHUDJHSHUVRQGRHVQRWQHHGDQ\IXUWKHUSURRILQWKLVFDVHEH\RQG
WLPH"7KHDYHUDJHSHUVRQGRHVQRWQHHGDQ\IXUWKHUSURRILQWKLVFDVHEH\RQG
WKDWDIIRUGHGE\KLVRUKHURZQH[SHULHQFH
,WPD\EHDVNHGWKDWLIWKHQHUYHIRUFHLVLQKHUHQWLQWKHXQLYHUVDOHWKHUDQG
REWDLQHGIURPWKHDWPRVSKHUHZK\DOOSHUVRQVDUHQRWHTXDOO\HQGRZHGZLWK
WKLVHQHUJ\7KHDQVZHULVWKDWWKHOLIHKDELWVRILQGLYLGXDOVGLIIHUDQGMXVWDV
RQHLVSK\VLFDOO\VWURQJDQGUREXVWDQGDQRWKHUZHDNDQGGHOLFDWHVRLVRQH
LQGLYLGXDOVWURQJLQQHUYHIRUFHDQGDQRWKHUZHDNLQLW0RUHRYHUDFKDQJHLQ
WKHOLIHKDELWVRIWKHSHUVRQZLOOLQHYLWDEO\UHVXOWLQDFKDQJHLQWKHDPRXQWRI
QHUYHIRUFHDEVRUEHGDQGUHWDLQHGE\KLPRUKHU,QIDFWRQHRIWKHSXUSRVHVRI
WKLVERRNLVWRLQVWUXFW\RXKRZ\RXPD\LQFUHDVHWKHQHUYHIRUFHZLWKLQ\RXUVHOI
:KLOHWKHREMHFWLVWKHLQFUHDVHRI\RXUSHUVRQDOPDJQHWLVP\RXZLOOILQGWKDWDW
WKHVDPHWLPH\RXUJHQHUDOKHDOWKDQGYLJRUZLOOLPSURYH
,QDGGLWLRQWRWKHDPRXQWRIQHUYHIRUFHEHLQJGHWHUPLQHGE\WKHOLIHKDELWVRI
WKHLQGLYLGXDOLWLVDOVRWUXHWKDWWKHLQGLYLGXDOPD\E\WKHSURSHUH[HUFLVHVVR
HQHUJL]HKLVQHUYRXVV\VWHPWKDWKHZLOOODUJHO\LQFUHDVHWKHGHJUHHRIDFWLYLW\
RIKLVQHUYHIRUFHDQGPD\UHQGHULWIDUPRUHDYDLODEOHIRUKLVUHTXLUHPHQWV,W
LVQ WRQO\DTXHVWLRQRIVHFXULQJDSOHQWHRXVVXSSO\RIQHUYHIRUFHEXWDOVRRI
KDYLQJWKHVDPHLQDQDFWLYHFRQGLWLRQDQGLQVXFKDIRUPWKDWLWPD\EHUHDGLO\
DYDLODEOHIRUWKHUHTXLUHPHQWVRIHYHU\GD\OLIH
&KDSWHU
3K\VLFDO0DJQHWLVP
7DEOHRI&RQWHQW

<RXZLOOUHPHPEHUWKDWZKHQ\RXKDYHFRPHLQFRQWDFWZLWKDQ\RIWKHVWURQJ
FKDUDFWHUVLQDQ\ZDONRIOLIHȈWKHJUHDWSUHDFKHUVODZ\HUVVWDWHVPHQRUDWRUV
EXVLQHVVPHQHWFȈWKRVHZKRVHVXFFHVVGHSHQGVXSRQWKHVWURQJHIIHFWWKH\
SURGXFHXSRQRWKHUSHUVRQV\RXKDYHEHHQFRQVFLRXVRIDIHHOLQJWKDWWKH\
UDGLDWHVWUHQJWKDQGSRZHU<RXDFWXDOO\IHOWWKHSRZHUFRPLQJIURPWKHP$QG
\RXZLOODOVRUHPHPEHUWKDWWKLVSRZHUGLGQRWVHHPWR\RXWREHPHQWDOSRZHU
RULQWHOOHFWXDOVWUHQJWKDORQHȈLWVHHPHGLQVWHDGWRKDYHPXFKRIWKHSK\VLFDO
LQLW6RVWURQJLVWKLVSRZHULQWKHFDVHRIVRPHRIWKHZRUOG VJUHDWFKDUDFWHUV
WKDWWKH\VHHPWREHSHUVRQLILHGZLOOSRZHUȈPLJKW\FHQWHUVRIYLWDOL]HGHQHUJ\
DIIHFWLQJDOOZLWKZKRPWKH\FRPHLQFRQWDFW
,QRUGHUWRUHDOL]HWKHGLIIHUHQFHEHWZHHQWKLVSRZHUDQGSXUHLQWHOOHFWXDO
VWUHQJWKDQGDELOLW\\RXKDYHEXWWRUHPHPEHUDQRWKHUFODVVRIJLIWHGSHUVRQV
QDPHO\WKHJUHDWVWXGHQWVZULWHUVHWFDQGRWKHUPHQZKRKDYHGHYHORSHG
JUHDWLQWHOOHFWXDOSRZHU7KHVHPHQDVDUXOHDUHQRWPDJQHWLFDVWKHWHUPLV
JHQHUDOO\XVHG7KH\GRQRWUDGLDWHRUWKURZRIIIRUFHDQGWKHHOHPHQWRI
SK\VLFDOPDJQHWLVPLVDOPRVWHQWLUHO\DEVHQW7KH\VHHPWREHFHQWHUVRIJUHDW
LQWHOOHFWXDOHQHUJ\ȈEXWQRWKLQJPRUH,DPQRWQRZVSHDNLQJRILQGLYLGXDOVLQ
ZKRPERWKWKHLQWHOOHFWXDODQGWKHSK\VLFDODUHZHOOEDODQFHGDQGFRPELQHGEXW
LQVWHDGRIWKRVHLQGLYLGXDOVZKRDUHGLVWLQFWO\PHQWDORULQWHOOHFWXDO$
PRPHQW VWKRXJKWZLOOUHFDOOPDQ\H[DPSOHVRIWKHW\SHWRZKLFK,UHIHUȈWKH
WHDFKHUVSUHDFKHUVODZ\HUVDQGVWXGHQWVZKRVHLQWHOOHFWXDOLW\LVZHOO
GHYHORSHGEXWZKRODFNWKDWVRPHWKLQJZKLFKLPSUHVVHVSHUVRQV
$QRWKHUDSSHDOWR\RXUPHPRU\ZLOOVKRZ\RXDOVRWKDWWKHPDJQHWLF
SHUVRQLVDOPRVWDOZD\VSRVVHVVHGRIWKDWLQGHILQDEOHVRPHWKLQJZKLFKZHFDOO
VWUHQJWKDQGHQHUJ\+HPD\QRWEHDVWRXWODUJHSHUVRQȈKHPD\HYHQEHD
VFUDZQ\ODQNLQGLYLGXDORIVOLJKWIUDPHDQGVPDOOVWDWXUHȈEXWHYHQLQWKHODVW
FDVHKHZLOOEHZLU\DQGOLNHDFRLOHGZLUHVSULQJIXOORIODWHQWHQHUJ\7KH
PDJQHWLFSHUVRQLVQHYHUWKHZHDNIODEE\MHOO\ILVKW\SH,KDYHVHHQWKHVHWKLQ
PDJQHWLFSHUVRQVRQWKHLUGHDWKEHGVZHDNHQHGE\GLVHDVHEXWHYHQLQWKHLUODVW
PRPHQWVWKH\JDYHRQHWKHLPSUHVVLRQRINHHQVSULQJOLNHVWUHQJWK7KHRWKHU
W\SHRIPDJQHWLFSHUVRQWKHVWRXWW\SHDOVRJLYHVWKHLPSUHVVLRQRISRZHUDQG
VWUHQJWKȈDVRPHWKLQJZLWKLQZKLFKVWRUHVDQGUDGLDWHVVWUHQJWKDQGSRZHU,V
VWUHQJWKȈDVRPHWKLQJZLWKLQZKLFKVWRUHVDQGUDGLDWHVVWUHQJWKDQGSRZHU,V
WKLVQRWVRLQ\RXURZQH[SHULHQFH"'LG\RXHYHUVHHDJUHDWOHDGHUȈDPDJQHWLF
SHUVRQDOLW\ȈZKRGLGQRWFRQYH\WKHLGHDRIVWUHQJWKLQWKHSK\VLFDOVHQVH",
WKLQNQRW
1RZUHPHPEHUWKDW,DPQRWFODLPLQJWKDWSK\VLFDOQHUYHIRUFHDORQH
FRQVWLWXWHVSHUVRQDOPDJQHWLVP)DUIURPWKLVȈWKHUHDUHPDQ\PHQZKRSRVVHVV
DQGUDGLDWHSK\VLFDOQHUYHIRUFHZKRDUHQRWSHUVRQDOO\PDJQHWLFLQWKHIXOOVHQVH
RIWKHWHUP7KHFRPELQDWLRQRIPHQWDOPDJQHWLVPDQGSK\VLFDOPDJQHWLVPLV
QHHGHGWRSURGXFHWKHIXOOSKHQRPHQRQRISHUVRQDOPDJQHWLVPUHPHPEHU%XW
,GRLQVLVWWKDWPHQWDOPDJQHWLVPZLWKRXWLWVSK\VLFDOFRXQWHUSDUWLVOLNHDPLQG
ZLWKDERG\ȈLWODFNVVXEVWDQFHDQGHIIHFWLYHQHVV
7KHRFFXOWLVWVLQIRUPXVWKDWLQWKHSHUVRQDODWPRVSKHUHRIWKHLQGLYLGXDOȈ
KLVDXUDWKH\FDOOLWȈWKHUHLVWREHIRXQGQRWRQO\WKHYLEUDWLRQVRIKLVPHQWDO
VWDWHVDQGFKDUDFWHUEXWDOVRWKHYLEUDWLRQVRIKLVSK\VLFDOPDJQHWLVPRU
QHUYHIRUFHDV,KDYHFDOOHGLWLQWKLVERRN7KH\VWDWHWKDWWRWKRVHZKRKDYH
GHYHORSHGSV\FKLFRUFODLUYR\DQWSRZHUWKHVHQHUYHIRUFHYLEUDWLRQVPD\EH
VHHQH[WHQGLQJIURPWKHERG\VRPHWZRRUWKUHHIHHWLQHLWKHUGLUHFWLRQWKH
ZKROHDXUDKDYLQJDQHJJVKDSHKHQFHLWVQDPH,WLVVDLGWRKDYHDIDLQWYLROHW
FRORUȈVRPHWKLQJOLNHDSDOHHOHFWULFIODPHȈDQGWRTXLYHUDQGYLEUDWHLQD
PDQQHUVLPLODUWRWKHPRWLRQVRIKHDWHGDLUDULVLQJIURPDVWRYHRUWKHJURXQG
RQDKRWVXPPHUGD\VRIDPLOLDUWRHYHU\REVHUYHU7KH\DOVRFODLPWKDWZKHQD
VWURQJSHUVRQLVXVLQJKLVZLOOWKLVQHUYHIRUFHFDUU\LQJZLWKLWKLVPHQWDO
PDJQHWLVPPD\EHVHHQVKRRWLQJLQJUHDWVKHHWVRUIODVKHVIURPKLPWRWKHRWKHU
SHUVRQRUSHUVRQV,GRQRWFODLPWRSRVVHVWKLVSV\FKLFYLVLRQP\VHOIEXWWKH
WHVWLPRQ\RIPDQ\RIP\SV\FKLFIULHQGVDJUHHLQWKLVPDWWHUDQGDUHLQDFFRUG
ZLWKWKHZULWLQJRIWKHROGHURFFXOWLVWV$QGDWDQ\UDWHDQ\RQHH[SHULPHQWLQJ
ZLWKSHUVRQDOPDJQHWLVPZLOOEHFRQYLQFHGWKDWQHUYHIRUFHRUSK\VLFDO
PDJQHWLVPGRHVDFWLQMXVWWKHZD\GHVFULEHGWKRXJKLWUHPDLQVXQVHHQE\WKH
H\HRIWKHRUGLQDU\SHUVRQ
$QRWKHULPSRUWDQWELWRILQIRUPDWLRQIXUQLVKHGE\WKHRFFXOWLVWVZKLFKLV
IXOO\YHULILHGE\P\RZQREVHUYDWLRQVDQGH[SHULPHQWVDQGZKLFKLQIDFWIRUPV
RQHRIWKHIRXQGDWLRQSLOODUVRIP\V\VWHPRISHUVRQDOPDJQHWLVPLVWKDW
FRQFHUQLQJWKHSDUWSOD\HGE\QHUYHIRUFHLQWKHSKHQRPHQDRIWHOHSDWK\
K\SQRWLVPPHQWDOLQIOXHQFHDQGVLPLODUSKHQRPHQDLQZKLFKWKHPLQGRIRQH
SHUVRQDFWVXSRQWKHPLQGRIDQRWKHUȈWKLVRIFRXUVHEHLQJRQHRIWKHPDLQ
IHDWXUHVRISHUVRQDOPDJQHWLVP,DOOXGHWRZKDWPD\EHFDOOHGWKHYLWDOL]LQJRI
WKHWKRXJKWZDYHVE\WKHFXUUHQWRIQHUYHIRUFHZKLFKLVSURMHFWHGDWWKHVDPH
WLPHZLWKLW
7KRXJKWZDYHVXQDFFRPSDQLHGE\FXUUHQWVRIQHUYHIRUFHODFNIRUFHDQG
HIIHFWDQGDUHOLNHFROGPHQWDOSRZHUGHYRLGRIOLIHDQGDFWLYLW\<RXZLOOJUDVS
WKLVLGHDEHWWHUE\UHIHUHQFHWRDFRPPRQRFFXUUHQFHIRULQVWDQFH\RXKDYH
WKLVLGHDEHWWHUE\UHIHUHQFHWRDFRPPRQRFFXUUHQFHIRULQVWDQFH\RXKDYH
KHDUGPDQ\DVHUPRQVSHHFKRUUHFLWDWLRQGHOLYHUHGE\DSHUVRQKDYLQJPDUNHG
LQWHOOHFWXDODELOLW\DQGILOOHGZLWKJRRGVRXQGWKRXJKWVDQG\HWWKHGHOLYHU\
VHHPHGGHDGGXOOFRORUOHVVDQGOLIHOHVVGLGLWQRW",WODFNHGWKHOLIHYLJRUDQG
YLPRIWKHGHOLYHU\RIVRPHRWKHUVSHDNHURIHYHQOHVVLQWHOOHFWXDOSRZHUGLGLQ
QRW"$QG\RXKDYHQRWLFHGWKDWWKHSHUVRQDOLW\RIVRPHDGPLWWHGO\LQWHOOHFWXDO
SHUVRQDJHODFNHGOLIHZKLOHVRPHRWKHUOHVVJLIWHGSHUVRQDOLW\IDLUO\UDGLDWHG
OLIHDQGVWUHQJWKDQGFRQVHTXHQWO\PDJQHWLFSRZHU:HOOWKLVUHSUHVHQWVWKH
GLIIHUHQFHEHWZHHQSODLQWKRXJKWZDYHVDQGWKRXJKWZDYHVDFFRPSDQLHGE\
VWURQJQHUYHIRUFH7KHRQHODFNVERG\DQGYLWDOL]LQJIRUFHZKLOHWKHRWKHU
SRVVHVVHVWKLVLQDEXQGDQFH7KLQNRYHUWKLVFDUHIXOO\XQWLO\RXJHWLWȈIRULQ
LWOD\VRQHRIWKHWZRJUHDWVHFUHWVRISHUVRQDOPDJQHWLVP
$SHUVRQLQZKRPQHUYHIRUFHLVDFWLYHO\SUHVHQWDQGZKRKDVFRQVFLRXVO\RU
XQFRQVFLRXVO\DFTXLUHGWKHDUWRIFRPELQLQJLWZLWKKLVWKRXJKWZDYHVZLOOVHQG
IRUWKZRUGVRUWKRXJKWVIDLUO\FKDUJHGZLWKG\QDPLFIRUFHUHDFKLQJDQG
DIIHFWLQJWKRVHZLWKZKRPWKH\FRPHLQFRQWDFW/LNHDKLJKSRZHUH[SORVLYH
VKHOOWKHQHUYHIRUFHGULYHVWKHWKRXJKWZDYHOLNHDEXOOHWWRWKLVPDUNKLWWLQJ
WKHEXOO VH\HZLWKDWUHPHQGRXVLPSDFWDQGPDNLQJDSRZHUIXOLPSUHVVLRQRQ
WKHPLQGRIWKHRWKHUSHUVRQRUSHUVRQV7KHUHDUHSHUVRQVZKRVHZRUGVVHHP
IDLUO\DOLYHVRYLWDOLVWKHLUDFWLRQXSRQWKHPLQGVRIRWKHUVȈWKHVHSHUVRQVKDYH
VWURQJO\DFWLYHQHUYHIRUFHRUSK\VLFDOPDJQHWLVPXVHGLQFRQQHFWLRQZLWKWKHLU
PHQWDOFXUUHQWV7KH\IODVKRXWWKLVFRPELQHGIRUFHWRZDUGWKHLUDXGLHQFHVRI
PDQ\SHUVRQVDQGWKHODWWHUDUHIDLUO\OLIWHGRIIWKHLUIHHWE\WKHSRZHU
7KHJUHDWOHDGHUVRIPHQKDYHKDGWKLVQHUYHIRUFHODUJHO\GHYHORSHGDQG
DFWLYHO\HPSOR\HG:KHQWKH\VSRNHWKHRWKHUSHUVRQVZHUHDOPRVWFRPSHOOHG
WRGRWKHELGGLQJRIWKHVWURQJSHUVRQ-XOLXV&DHVDUDQG1DSROHRQ%RQDSDUWH
ZHUHWZRPDUNHGH[DPSOHVRIWKHXVHRIWKLVSRZHUEXWDVDIDFWHYHU\PDQ
ZKRVZD\VPRYHVDQGUXOHVRWKHUSHUVRQVLVDQH[DPSOHZRUWK\RIVWXG\7KH
VWXGHQWVKRXOGLISRVVLEOHPDQDJHWREHWKURZQLQFRQWDFWZLWKWKLVFODVVRI
SHUVRQVVRWKDWKHPD\VHHRUUDWKHUIHHOIRUKLPVHOIWKHHIIHFWRIWKLVPLJKW\
IRUFHHPDQDWLQJIURPWKHVHLQGLYLGXDOV+HZLOOWKHQEHWWHUUHDOL]HMXVWZKDWSDUW
QHUYHIRUFHSOD\VLQWKHPDWWHURISHUVRQDOLQIOXHQFHDQGSHUVRQDOPDJQHWLVP
DQGWKHQEHPRUHILUPO\UHVROYHGWRGHYHORSLWLQKLPVHOIRUKHUVHOI
7KHUHDUHVRPHSHUVRQVZKRVHHPQDWXUDOO\WRDEVRUEVWRUHXSDQG
HIIHFWLYHO\XVHWKHLUQHUYHIRUFHRISK\VLFDOPDJQHWLVP6XFKDUHYHU\IRUWXQDWH
IRUWKH\DUHVDYHGWKHWURXEOHRIFXOWLYDWLQJWKHSURFHVVHVUHIHUUHGWR%XWWKRVH
ZKRGRQRWSRVVHVVWKLVJLIWQDWXUDOO\PD\E\SUDFWLFHDQGSHUVHYHUDQFH
GHYHORSLWLQWKHPVHOYHV1D\PRUHWKH\PD\HYHQWXDOO\HYHQVXUSDVVWKH
QDWXUDOO\JLIWHGPDQIRUWKHODWWHUGRHVQRWXQGHUVWDQGWKHVRXUFHRUQDWXUHRI
KLVSRZHUDQGLVDSWWRQHJOHFWRUDEXVHLWZKLOHWKHSHUVRQZKRGHYHORSVLWLQ
KLVSRZHUDQGLVDSWWRQHJOHFWRUDEXVHLWZKLOHWKHSHUVRQZKRGHYHORSVLWLQ
KLPVHOIDFFRUGLQJWRUXOHDQGZLWKDIXOOXQGHUVWDQGLQJKDVWKHWKLQJRQWDS
DVLWZHUHDQGFDQDOZD\VUHFXSHUDWHIURPDQRYHUGUDLQRQDQHUYRXVV\VWHP
.QRZOHGJHLVSRZHUDQGDFXOWLYDWHGDQGGHYHORSHGIDFXOW\LVRIWHQIDUPRUH
HIIHFWLYHWKDQDVLPLODUIDFXOW\SUHVHQWDWELUWKDQGQRWXQGHUVWRRGRUZRUNHG
IRU
%HJLQQLQJZLWKWKHQH[WFKDSWHU,SXUSRVHJLYLQJ\RXSODLQVLPSOH
GLUHFWLRQVIRUWKHLQFUHDVHRI\RXUQHUYHIRUFHWKHVWRULQJXSRIWKHVDPHDQGWKH
FRQVFLRXVSURMHFWLRQRILWWRYLWDOL]H\RXUPHQWDOFXUUHQWV7KHSURFHVVLVTXLWH
QDWXUDODQGGRHVQRWSDUWDNHRIDQ\P\VWLFFHUHPRQLHVRUDQ\WKLQJRIWKDWVRUW
,WLVEDVHGRQSXUHO\SK\VLRORJLFDOSULQFLSOHVDQGLVLQIXOODFFRUGZLWKQDWXUDO
ODZV:KHQ\RXKDYHRQFHDFTXLUHGWKHDUWDQGVFLHQFHRIWKHDEVRUSWLRQDQG
VWRULQJRIQHUYHIRUFH\RXZLOOEHVXUSULVHGWKDW\RXKDYHQHYHUWKRXJKWRILW
EHIRUH
:KHQ\RXDFTXLUHWKLVSRZHU\RXZLOOEHFRQVFLRXVRIEHLQJDFHQWHURIDQ
HQRUPRXVHQHUJ\DQGZLOODOVREHPDGHDZDUHRI\RXUSRZHUE\WKHHIIHFWXSRQ
RWKHUSHUVRQV1RWRQO\LQWKHPDWWHURISHUVRQDOPDJQHWLVP,PHDQEXWDOVRLQ
WKHPDWWHURILPSDUWLQJWKHYLEUDWLRQVRIVWUHQJWKDQGHQHUJ\<RXZLOOQRWLFH
WKDWRWKHUSHUVRQVZLOOEHFRQVFLRXVRIVRPHWKLQJLQ\RXUKDQGVKDNHDQGWRXFK
WKDWZLOOVXUSULVHWKHP7KH\ZLOOQRWXQGHUVWDQGMXVWZKDWDIIHFWVWKHPEXWWKH\
ZLOOEHFRQVFLRXVRIVRPHVWUDQJHIHHOLQJSHUYDGLQJWKHP7KHEHVWSODQZLOOEH
IRU\RXWRNHHS\RXUVHFUHWWR\RXUVHOIDQGWRDYRLGDQ\LPSUHVVLRQRIEHLQJRXW
RIWKHRUGLQDU\<RXZLVKWRFUHDWHFRQILGHQFHQRWIHDUȈDQGWKHVWUDQJHDQG
P\VWHULRXVFDXVHVIHDUUDWKHUWKDQFRQILGHQFH6RNHHS\RXURZQVHFUHWV
&KDSWHU
*HQHUDWLQJ1HUYH)RUFH
7DEOHRI&RQWHQW

%\UHIHUHQFHWRWKHILUVWSDUDJUDSKRI&KDSWHU,9\RXZLOOVHHWKDW,KDYH
VHSDUDWHGWKHSK\VLFDOSKDVHRIPHQWDOPDJQHWLVPLQWRWZRFRRUGLQDWHG
PDQLIHVWDWLRQVWKHILUVWRIZKLFKLHWKHJHQHUDWLRQZLWKLQWKHQHUYRXVV\VWHP
RIDSOHQWHRXVVXSSO\RIQHUYHIRUFH,VKDOOQRZGHVFULEH
7KHZRUGJHQHUDWLRQLQWKLVFRQQHFWLRQRQO\LPSHUIHFWO\FRQYH\VWKHLGHD
RIWKHDFWXDOSURFHVVRIDFTXLULQJQHUYHIRUFHZLWKLQWKHQHUYRXVV\VWHPIRUWKH
SURFHVVLVRQHRIDEVRUSWLRQDQGGLVWULEXWLRQUDWKHUWKDQRQHRIJHQHUDWLRQ
%XWDVWKHODWWHUWHUPFRQYH\VDVLPSOHUSLFWXUHRIWKHSURFHVV,KDYHWKRXJKW
ZHOOWRXVHLWLQWKLVFRQQHFWLRQSDUWLFXODUO\DVPDQ\RIWKHROGRFFXOWZULWHUV
KDYHXVHGLWLQWKLVVHQVHEHIRUHP\WLPH
7KLVSURFHVVRIQHUYHIRUFHJHQHUDWLRQPD\EHVDLGWRFRQVLVWRIWZRGLVWLQFW
\HWFRRUGLQDWHGSKDVHVYL]  WKHDEVRUSWLRQRIDQH[WUDDPRXQWRIQHUYHIRUFH
IURPWKHDWPRVSKHUHE\VSHFLDOIRUPVRIEUHDWKLQJDQG  WKHGLVWULEXWLRQRI
WKHVDPHWRWKHJUHDWFHQWHUVRIWKHQHUYRXVV\VWHPZKLFKDFWDVUHVHUYRLUVRI
QHUYHIRUFH,VKDOOQRZSURFHHGWRFRQVLGHUWKHVHWZRUHVSHFWLYHSKDVHVLQWKHLU
SURSHURUGHU
7KHILUVWSKDVHRIQHUYHIRUFHJHQHUDWLRQFRQVLVWVRIWKHDEVRUSWLRQRIDQH[WUD
VXSSO\RIQHUYHIRUFHIURPWKHDWPRVSKHUHE\PHDQVRIVSHFLDOIRUPVRI
EUHDWKLQJ$OOSHUVRQVFRQVWDQWO\DEVRUEQHUYHIRUFHIURPWKHDWPRVSKHUHLQWKH
RUGLQDU\SURFHVVRIEUHDWKLQJWKHDPRXQWGLIIHULQJZLWKWKHLQGLYLGXDORUUDWKHU
ZLWKKLVKDELWVRIEUHDWKLQJ<RXZLOOKDYHQRWLFHGWKDWWKHYLJRURXVVWURQJ
LQGLYLGXDOQHDUO\DOZD\VEUHDWKHVIXOO\ȈWKDWLVGHHSO\DQGUHJXODUO\ȈZKLOH
WKHZHDNSHUVRQZLOOEUHDWKHRQO\SDUWLDOO\DQGLUUHJXODUO\7KHUHLVDYHU\FORVH
FRQQHFWLRQEHWZHHQIXOOUHJXODUEUHDWKLQJDQGJHQHUDOSK\VLFDOKHDOWKDQG
VWUHQJWKEXW,VKDOOQRWWRXFKXSRQWKLVSKDVHRIWKHVXEMHFWKHUHIRULWIRUPVQR
SDUWRIWKLVVSHFLDOLQVWUXFWLRQ,PHUHO\GURSDKLQWZKLFKWKHZLVHZLOOWDNH
DGYDQWDJHRI
:LWKRXWZLVKLQJWROHDG\RXLQWRWKHVXEWOHWLHVRI2ULHQWDOSV\FKRORJ\ZLWK
LWVFRPSOLFDWHGIRUPVRIEUHDWKLQJIRUSV\FKLFDQGVSLULWXDOGHYHORSPHQWHWF,
PXVWFDOO\RXUDWWHQWLRQDWWKLVSRLQWWRWKHSKLORVRSK\XQGHUO\LQJVRPHRIWKH
2ULHQWDOEUHDWKLQJSUDFWLFHVIRUWKHVDPHLVEDVHGRQWKHVRXQGHVWVFLHQWLILF
SULQFLSDOV7KH2ULHQWDOSKLORVRSK\WHDFKHVWKDWHDFKPHQWDODQGSK\VLFDOVWDWH
SULQFLSDOV7KH2ULHQWDOSKLORVRSK\WHDFKHVWKDWHDFKPHQWDODQGSK\VLFDOVWDWH
RIWKHLQGLYLGXDOLVUHSUHVHQWHGE\DVSHFLDOUK\WKPRIEUHDWKWKHUK\WKPDQG
FRQGLWLRQDOZD\VEHLQJIRXQGWRJHWKHU7KHPHQWDORUSK\VLFDOFRQGLWLRQZLOO
LQYDULDEO\PDQLIHVWWKHSDUWLFXODUUK\WKPRIEUHDWKZKLFKEHORQJVWRLWDQG
OLNHZLVH DQGWKLVLVRQHRIWKHRFFXOWVHFUHWV WKHGHOLEHUDWHDVVXPSWLRQRID
SDUWLFXODUUK\WKPRIEUHDWKZLOOVSHHGLO\UHVXOWLQWKHPDQLIHVWDWLRQRIWKH
DSSURSULDWHSK\VLFDORUPHQWDOFRQGLWLRQ
<RXKDYHEXWWRFRQVLGHUWKHVXEMHFWIRUDPRPHQWWRVHHWKDWZKHQ\RXDUH
IULJKWHQHGRUDQJU\\RXEUHDWKHZLWKDGLIIHUHQWUK\WKPWKDQZKHQ\RXDUHFDOP
DQGSHDFHIXO(DFKHPRWLRQXSDQGGRZQWKHVFDOHKDVLWVRZQDSSURSULDWH
UK\WKPRIEUHDWKZKLFKLQYDULDEO\PDQLIHVWVDWWKHVDPHWLPH0RUHRYHU
GLIIHUHQWSK\VLFDOFRQGLWLRQVOLNHZLVHPDQLIHVWLQFRRUGLQDWHGEUHDWKUK\WKPV
.HHSDFORVHZDWFKRQ\RXUVHOIDQGWKRVHDURXQG\RXDQG\RXZLOOVRRQVHH
WKDWWKHDERYHVWDWHPHQWVRIIDFWVDUHVWULFWO\FRUUHFW<RXZLOOZRQGHUZK\\RX
QHYHUQRWLFHGWKHSKHQRPHQDEHIRUH
$OLWWOHOHVVNQRZQHYHQLVWKHFRUUHODWHGIDFWWKDWWKHGHOLEHUDWHDVVXPSWLRQ
RUDFWLQJRXWRIWKHSDUWLFXODUEUHDWKȈUK\WKPUHODWHGWRDSDUWLFXODUHPRWLRQ
ZLOOUHVXOWLQDVSHHG\H[SHULHQFLQJRIWKHHPRWLRQLWVHOI7KLVDOVRPD\EHWHVWHG
RXWRQ\RXUVHOI
<RXZLOOILQGWKDWDIHZPRPHQWV DQJHUEUHDWKRUIHDUEUHDWK LIZHOODFWHG
RXWRUDVVXPHGIDLWKIXOO\ ZLOOUHVXOWLQ\RXVRRQH[SHULHQFLQJDIHHOLQJRIDQJHU
RUIHDUDVWKHFDVHPD\EH/LNHZLVH\RXZLOOILQGWKDWWKHGHOLEHUDWH
DVVXPSWLRQRQ\RXUSDUWRIWKHEUHDWKUK\WKPRISHDFHFDOPVHOIFRQWUROZLOO
EHVXIILFLHQWWRLQGXFHWKDWSDUWLFXODUVWDWHRIIHHOLQJLQ\RX7KHUHLVDELJKLQW
LQWKLVODVWVHQWHQFHE\WKHZD\IRUWKDWLVH[DFWO\ZKDWWKH2ULHQWDOVDJHVGRWR
LQGXFHDQGPDLQWDLQWKHPHQWDOVWDWHRISKLORVRSKLFFDOPIRUZKLFKWKH\DUH
QRWHG,QWKLVFRQQHFWLRQOHWXVUHPLQG\RXWKDWZKHQ\RXDUHHQGHDYRULQJWR
FRQWURO\RXUWHPSHUDQGWRPDLQWDLQ\RXUSRVHXQGHUH[WUHPHSURYRFDWLRQ\RX
ZLOOILQGWKDW\RXLQVWLQFWLYHO\VWULYHWRFRQWURO\RXUEUHDWKUK\WKPZKLFKVKRZV
DPDUNHGWHQGHQF\WRIO\RIILQWRDVWDWHRIUDSLGSDQWLQJDQGJDVSLQJ$QGVR
ORQJDV\RXFDQPDLQWDLQ\RXUVWHDG\FRQWUROOHGUK\WKPRIEUHDWK\RXZLOO
PDLQWDLQ\RXUSRLVHDQGVHOIFRQWURO
:HOOWRPDNHDORQJVWRU\VKRUWȈWRJHWULJKWGRZQWRWKHJLVWRIWKHVXEMHFW
RIWKHDEVRUSWLRQRIQHUYHIRUFHWKURXJKFRQWUROOHGEUHDWKUK\WKPȈOHWPHVD\WR
\RX  WKDWWKHUHLVDEUHDWKUK\WKPZKLFKQDWXUHXVHVWRUHVWRUHQHUYHIRUFHWR
WKHGHSOHWHGV\VWHPDIWHUDJUHDWGHPDQGXSRQLWLQWKHGLUHFWLRQRIHLWKHUD
VWURQJPHQWDORUHPRWLRQDOVWUDLQRUDIWHUDVHYHUHSK\VLFDOVWUDLQDQG  WKDWD
GHOLEHUDWHDVVXPSWLRQRUDFWLQJRXWRIWKLVSDUWLFXODUEUHDWKUK\WKPZLOOUHVXOW
LQ\RXUEHLQJDEOHWRTXLFNO\DEVRUEDJUHDWO\LQFUHDVHGVXSSO\RIQHUYHIRUFHIRU
WKHSXUSRVHRIXVHLQSHUVRQDOPDJQHWLVPȈWRUHQGHU\RXIXOORISK\VLFDO
PDJQHWLVPLQIDFW'R\RXFDWFKWKLVSRLQW",IQRWUHUHDGWKHDERYHSDUDJUDSK
PDJQHWLVPLQIDFW'R\RXFDWFKWKLVSRLQW",IQRWUHUHDGWKHDERYHSDUDJUDSK
VHYHUDOWLPHVXQWLO\RXIXOO\JUDVSWKHLPSRUWDQFHRIWKHVWDWHPHQWVWKHUHLQ
FRQWDLQHGȈIRUWKH\FRPSULVHH[DFWO\RQHKDOIRIWKHSKLORVRSK\RIQHUYHIRUFH
JHQHUDWLRQȈDQGPXFKPRUHEHVLGHVLI\RXDUHDEOHWRJUDVSLW
<RXQDWXUDOO\DVNDWWKLVSRLQW:KDWLVWKLVSDUWLFXODUEUHDWKUK\WKPZKLFK
QDWXUHXVHVWRDLGXVLQUHFXSHUDWLQJDQGZKLFKQDWXUHXVHVWRDLGXVLQJ
UHFXSHUDWLQJDQGZKLFKPD\EHDVVXPHGZLWKVXFKZRQGHUIXOUHVXOW"9HU\
ZHOOOHWPHDQVZHU\RXE\DVNLQJ\RXDQRWKHUTXHVWLRQQDPHO\+RZGR\RX
EUHDWKHZKHQ\RXEHJLQWRUHFXSHUDWHMXVWDIWHUDVHYHUHPRWLRQDOPHQWDORU
SK\VLFDOVWUDLQZKHQWKHFKDUDFWHULVWLFILUVWSDQWLQJEUHDWKTXLHWVGRZQ",I\RX
ZLOOFRQVLGHUFDUHIXOO\\RXZLOODQVZHUWKDW\RXJHQHUDOO\EHJLQE\RQHRUWZR
ORQJGUDZQRXWVLJKLQJEUHDWKVIROORZHGE\DSHULRGRIFDOPGHOLEHUDWHVORZ
GHHSEUHDWKV<RXPD\QRWKDYHQRWLFHGLWEXWWKHVHODVWFDOPGHHSEUHDWKVDUH
PDUNHGE\DVORZEXWUHJXODUUK\WKPȈDVUHJXODULQGHHGDVWKHVORZVZLQJRI
WKHSHQGXOXPRIDODUJHFORFNRUWKHDFFRPSDQ\LQJWLFNWKHUHRI<RXZLOOILQG
WKDWWKLVVORZUHJXODUUK\WKPLFEUHDWKFRQWLQXHVIRUVRPHOLWWOHWLPHXQWLO\RX
IHHOUHIUHVKHGDQGUHLQYLJRUDWHGZKHQWKHEUHDWKZLOOGURSLQWRWKHQRUPDO
HYHU\GD\UK\WKPDQGWKHWDVNLVRYHU
:HOOWKLVLVH[DFWO\WKHEUHDWKUK\WKPZKLFKLISURSHUO\DVVXPHGDQGZHOO
DFWHGRXWZLOOUHVXOWLQGUDZLQJWR\RXDJUHDWO\LQFUHDVHGVXSSO\RI
QHUYHIRUFHIURPWKHXQLYHUVDOVWRUHKRXVHRIWKHVDPHLHWKHDWPRVSKHUH
DURXQG\RX
,DVN\RXVWXGHQWWRSDXVHDWKLVSRLQWDQGUHUHDGWKHSUHFHGLQJSDUDJUDSK
&RQVLGHULWFDUHIXOO\UROOLWRYHULQRXUPLQGXQWLO\RXIXOO\JUDVSLWV
WUHPHQGRXVVLJQLILFDQFHDQGIXOO\PDNHLW\RXURZQWKRXJKW)RULQWKRVHIHZ
OLQHVLVFRQGHQVHGDVWDWHPHQWRIZRQGHUIXOWUXWKZKLFKLIWDNHQDGYDQWDJHRI
ZLOOWUDQVIRUP\RXLQWRDYHU\JLDQWRISK\VLFDOPDJQHWLVP'RQRWSURFHHGZLWK
WKLVUHDGLQJXQWLO\RXKDYHIXOO\JUDVSHGWKHLPSRUWDQFHRIWKHLQIRUPDWLRQMXVW
JLYHQ\RX
%XWGRQRWLPDJLQHWKDW\RXFDQMXPSDWRQFHLQWRWKLVJUHDWSRZHU<RX
PXVWILUVWJUDGXDOO\DFTXLUHWKHH[DFWUK\WKPIRU\RXUVHOIȈIRU,FDQGRQRPRUH
WKDQWRLQGLFDWHLWWR\RX,FDQQRWVD\%UHDWKHLQMXVWVRPDQ\VHFRQGVKROG
WKHEUHDWKMXVWVRPDQ\DQGWKHQEUHDWKHRXWMXVWVRPDQ\DQGVRRQDVPDQ\
WHDFKHUVKDYHGRQHȈVRPHZKRVKRXOGKDYHNQRZQEHWWHUIRUWKDWPDWWHU)RU
HDFKSHUVRQKDVKLVRUKHURZQSDUWLFXODUEUHDWKUK\WKPRIWKLVNLQGWKH
GLIIHUHQFHDULVLQJIURPPHQWDORUSK\VLFDOIRUPDWLRQDQGFKDUDFWHULVWLFV
7KHIROORZLQJLVWKHUXOHȈWKHRQO\UXOHȈLQWKLVPDWWHU$VFHUWDLQILUVWWKH
SUHFLVHEUHDWKUK\WKPZKLFKQDWXUHKDVJLYHQ\RXIRUXVHLQPRPHQWVRI
UHFXSHUDWLRQDIWHUH[WUHPHPHQWDOHPRWLRQDORUSK\VLFDOVWUDLQDQGWKHQ
VHFRQGSUDFWLFHWKHVDPHYROXQWDULO\E\DVVXPLQJRUDFWLQJRXWWKHPHQWDODQG
VHFRQGSUDFWLFHWKHVDPHYROXQWDULO\E\DVVXPLQJRUDFWLQJRXWWKHPHQWDODQG
SK\VLFDOFRQGLWLRQVSURGXFLQJLWXQWLOWKHUK\WKPEHFRPHVIL[HGLQ\RXU
PHPRU\VRWKDW\RXFDQHDVLO\UHSURGXFHLWLQVWLQFWLYHO\ZKHQ\RXZLVK5HDG
WKLVUXOHRYHUXQWLO\RXWKRURXJKO\XQGHUVWDQGLW
<RXZLOOILQGLWVRPHZKDWGLIILFXOWWRDVVXPHRUDFWRXWWKHFRQGLWLRQV
SURGXFLQJWKHUK\WKPDWILUVWXQOHVV\RXKDSSHQWREHDQDWXUDORUZHOOWUDLQHG
DFWRU%XWNHHSWU\LQJXQWLO\RXPDVWHULW3UDFWLFHZLOOPDNHSHUIHFWLQWKLVDV
LQHYHU\WKLQJHOVHUHPHPEHU0HQWDOO\SODFH\RXUVHOILQWKHVDPHYLEUDWLRQVDV
ZKHQ\RXZHUHXQGHUVRPHJUHDWVWUDLQRIPLQGHPRWLRQRUERG\LQWKHSDVW
DQG\RXZLOOILQGWKDWWKHVDPHZLOOEHIROORZHGE\DQDFWLQJRXWRIWKHSHULRGRI
UHFXSHUDWLRQZLWKLWVDFFRPSDQLPHQWRIDSSURSULDWHEUHDWKUK\WKP(DFK
VWXGHQWZLOOPDQDJHWKLVLQKLVRUKHURZQZD\DQGZLOOJHWWKHUHVXOWLI
SHUVLVWHQWSHUVHYHULQJHIIRUWZHUHPDGH
<RXZLOOILQGWKDWWKHILUVWLQGLFDWLRQRIWKHUHFXSHUDWLQJEUHDWKUK\WKPZLOO
XVXDOO\EHDORQJGUDZQRXWVLJKIROORZHGE\DPRPHQWRIUHVWZKLFKLQWXUQ
LVIROORZHGE\DQHDV\WKRXJKGHHSVORZGHOLEHUDWHVXFFHVVLRQRILQEUHDWKLQJ
DQGRXWEUHDWKLQJLQSHUIHFWUK\WKPZKLFKZLOOEHDFFRPSDQLHGE\DIHHOLQJRI
LQFUHDVHGVWUHQJWKDQGYLWDOLW\RIPLQGDQGERG\ȈGHOLJKWHGWRH[SHULHQFHLVWKH
IHHOLQJRIUHOLHIDQGIUHVKYLJRUYLWDOLW\DQGYLPZKLFKUHVXOWVIURPWKLV
EUHDWKUK\WKP
,QSUDFWLFLQJWKLVUHFXSHUDWLYHEUHDWKUK\WKPIRUWKHSXUSRVHRIUHVWLQJ
JDLQLQJVWUHQJWKRULQFUHDVLQJ\RXUVWRUHRIQHUYHIRUFHGRQRWIDOOLQWRWKHWRR
FRPPRQHUURURIDUWLILFLDOUK\WKPLFEUHDWKLQJ'RQRWPDNHWKHPLVWDNHRI
WU\LQJWRFRXQWWKHVHFRQGVRIWKHEUHDWKRUWRPDNHWKHEUHDWKVH[WHQGQHLWKHU
RYHUDSDUWLFXODUWLPHQRUWRH[DFWO\PDWFKHDFKRWKHURUWRUHWDLQWKHEUHDWKDQ\
VSHFLDOWLPHQRUWRFRXQWWLPHEHWZHHQEUHDWKVRUDQ\WKLQJRIWKDWNLG)RUJHW
DOODERXWWKHDUWLILFLDOVWDQGDUGVDQGJLYH\RXUVHOIXSHQWLUHO\WRDSHDFHIXOFDOP
IHHOLQJRIUHOLHIDQGUHFXSHUDWLRQZKLFKQDWXUHZLOOEHVWRZXSRQ\RXLI\RXZLOO
FUHDWHWKHULJKWFRQGLWLRQVIRUWKHPDQLIHVWLQJRIKHUSRZHU'RQRWEHDUWLILFLDOȈ
WUXVWQDWXUHWRUXQWKHWKLQJDULJKWDQGOHDYHHYHU\WKLQJLQKHUKDQGV
'RQRWERWKHUDWWKLVSRLQWWRZRQGHUMXVWKRZPDQ\WLPHVDGD\\RXPXVW
SUDFWLFHWKLVH[HUFLVHLQRUGHUWRJDLQSK\VLFDOPDJQHWLVPDQGDEVRUEQHUYHIRUFH
7KDWSRLQWZLOOEHFRYHUHGLQDODWWHUFKDSWHULQFRQQHFWLRQZLWKWKH
DFFRPSDQ\LQJSURFHVVRIQHUYHIRUFHGLVWULEXWLRQȈWKHVROHWKLQJEHIRUH\RXQRZ
LVWROHDUQKRZWRSURGXFHWKLVEUHDWKUK\WKPDQGWRSUDFWLFHXQWLO\RXFDQ
SURGXFHLWDWZLOOHDVLO\DQGQDWXUDOO\ZLWKRXWHIIRUWRUVWUDLQȈLQVWLQFWLYHO\LQ
IDFW8QWLO\RXDFFRPSOLVKWKLVWKHUHLVQRXVHRI\RXUERWKHULQJ\RXUVHOIDERXW
WKHVXFFHHGLQJVWDJHV
$QGQRZDZRUGDERXWSUDFWLFLQJWKLVVWHS'RQRWRYHUGRWKHWKLQJȈPDNH
KDVWVORZO\,WLVDPDWWHURIJURZWKDQGGHYHORSPHQWZLWK\RXDQG\RXVKRXOG
KDVWVORZO\,WLVDPDWWHURIJURZWKDQGGHYHORSPHQWZLWK\RXDQG\RXVKRXOG
QRWWU\WRUXVKWKLQJVWRRUDSLGO\/HWQDWXUHSURFHHGWRPDNHWKHSURFHVV
LQVWLQFWLYHDQGGRQRWIDOOLQWRWKHPLVWDNHRISXOOLQJXSWKHURRWVRIRXUSODQWLQ
RUGHUWRVHHZKHWKHULWKDVJURZQRYHUQLJKW,WZLOOJURZ1HYHUIHDU<RXZLOO
NQRZZKHQ\RXDUHRQWKHULJKWWUDFNDQGZLOOEHDZDUHRI\RXUSURJUHVVE\
UHDVRQRI\RXULQFUHDVLQJVHQVHRIYLJRUYLWDOLW\DQGYLP
5HPHPEHUILQDOO\WKDWWKHVHFUHWRIWKHZKROHWKLVLVWKDW\RXKDYH
GLVFRYHUHGKRZQDWXUHUHFXSHUDWHVWKHV\VWHPLQWLPHVRIH[WUHPHQHFHVVLW\DQG
KDYHWKHQOHDUQHGKRZWRGUDZXSRQWKLVVRXUFHVRIHQHUJ\DWZLOOWKHUHE\
LQFUHDVLQJWKHVXSSO\IDUDERYHWKHRUGLQDU\,WLVMXVWDVLI\RXKDGGLVFRYHUHGD
ERWWOHFRQWDLQLQJWKHHOL[LURIHQHUJ\ZKLFKNLQG0RWKHU1DWXUHXVHVWR
UHFXSHUDWH\RXLQWLPHVRIQHHGDQGWKHQ\RXKDGOHDUQHGWKDW\RXFRXOGSDUWDNH
RIWKHHOL[LUGDLO\RUZKHQHYHU\RXIHOWOLNHLWDQGZHUHFRQVHTXHQWO\HQDEOHG
WRLQFUHDVH\RXUHQHUJ\DQGYLWDOLW\IDUDERYHWKHDYHUDJH7KHFRPSDULVRQRU
ILJXUHRIVSHHFKLVQRWH[DJJHUDWHGȈIRULQWKLVVHFUHW\RXKDYHLQGHHG
GLVFRYHUHGWKHHOL[LURIYLWDOLW\YLJRUDQGYLPWKDWLVLI\RXXVHLWDULJKW
&KDSWHU
'LVWULEXWLQJ1HUYH)RUFH
7DEOHRI&RQWHQW

,QWKHSUHFHGLQJ&KDSWHU,KDYHJLYHQ\RXJHQHUDOLQVWUXFWLRQVUHJDUGLQJWKHILUVW
SKDVHRIQHUYHIRUFHE\PHDQVRIFHUWDLQIRUPVRIUK\WKPLFEUHDWKLQJ,QRZ
SURFHHGWRWKHJHQHUDOLQVWUXFWLRQUHJDUGLQJWKHVHFRQGSKDVHRIQHUYHIRUFH
JHQHUDWLRQQDPHO\WKHGLVWULEXWLRQRIWKHDEVRUEHGQHUYHIRUFHWRWKHQHUYRXV
V\VWHPDQGSDUWLFXODUO\WRWKHJUHDWUHVHUYRLUVRIQHUYHIRUFH
7KLVSURFHVVRIQHUYHIRUFHGLVWULEXWLRQQDWXUDOO\IROORZVGLUHFWO\DIWHUWKDWRI
QHUYHIRUFHDEVRUSWLRQWKHWZREHLQJFRRUGLQDWHGSKDVHVRIRQHRIQDWXUH V
UHFXSHUDWLYHSURFHVVHV-XVWDVLVWKHSURFHVVRIWKHUHFXSHUDWLYHEUHDWKUK\WKP
QDWXUH VZD\RIUHVWRULQJWRWKHV\VWHPDIUHVKVXSSO\RIQHUYHIRUFHWRUHSODFH
WKDWXVHGLQWKHH[WUDRUGLQDU\PHQWDOHPRWLRQDORUSK\VLFDOVWUDLQSUHFHGLQJLW
VRLVWKHSURFHVVRIQHUYHIRUFHDEVRUSWLRQDQRWKHU RUWZLQ PHWKRGRIQDWXUHWR
GLVWULEXWHWKHDEVRUEHGQHUYHIRUFHWRDOOSDUWVRIWKHERG\VWUHQJWKHQLQJDQG
LQYLJRUDWLQJYLWDOL]LQJDQGVWLPXODWLQJHDFKDQGHYHU\SDUWRIWKHERG\DQGDW
WKHVDPHWLPHVWRULQJXSLQWKHJUHDWUHVHUYRLUVRIWKHQHUYRXVV\VWHPDUHVHUYH
VXSSO\RIQHUYHIRUFHIRUWLPHVRIIXWXUHQHHG
$JDLQ\RXDVN:KDWLVQDWXUH VZD\RIGLVWULEXWLQJWKHDEVRUEHG
QHUYHIRUFHDVDERYHVWDWHGZKLFKDOVRLVWKHZD\LQZKLFK\RXVWDWHVWXGHQWVRI
SHUVRQDOPDJQHWLVPPD\GLVWULEXWHWKHLUDEVRUEHGQHUYHIRUFHRUSK\VLFDO
PDJQHWLVP"$VLQWKHFDVHRIWKHSUHYLRXVTXHVWLRQ,DQVZHU*RWRQDWXUH
KHUVHOIDQGGLVFRYHUKHUPHWKRG/HWXVWKHQGRVR
,QYHVWLJDWLQJQDWXUH VPHWKRGRIGLVWULEXWLQJSK\VLFDOPDJQHWLVPRU
QHUYHIRUFHZKDWGRZHILQGQDWXUHGRLQJMXVWDIWHUWKHSHUVRQLVH[KDXVWHGE\
PHQWDOHPRWLRQDORUSK\VLFDOH[HUWLRQȈWKDWLVLQDGGLWLRQWRWKHSHFXOLDU
EUHDWKUK\WKP$QVZHU:HILQGDFFRPSDQ\LQJWKHORQJGHHSVLJKSUHFHGLQJ
WKHEUHDWKUK\WKPDQGDOVRIROORZLQJWKHUK\WKPLFEUHDWKLQJDWHQGHQF\WR
VWUHWFKWKHPXVFOHVRIWKHERG\1RWRQO\GRZHQRWLFHWKLVSKHQRPHQRQDW
VXFKWLPHVEXWDOVRLWLVWREHREVHUYHGZKHQZHDZDNHQLQWKHPRUQLQJZLWKD
\DZQIROORZHGE\DQLQVWLQFWLYHVWUHWFKLQJRIWKHPXVFOHV:HREVHUYHWKHVDPH
WKLQJDIWHUZHKDYHXVHGXSQHUYHIRUFHLQOLVWHQLQJUHDGLQJVWXG\LQJHWFȈLQ
IDFWLQDQ\DFWLRQZKLFKKDVUHTXLUHGFRQFHQWUDWHGDWWHQWLRQ,WLVDOZD\VWKH
\DZQWKHGHHSVLJKWKHPHDVXUHGEUHDWKDQGILQDOO\WKHVWUHWFKLQJRIWKH
PXVFOHV
1RZGRQRWGLVPLVVWKLVPDWWHUZLWKDWULIOLQJMHVWRUDQDPXVHGVPLOHȈIRU
WKLVVWUHWFKLQJRIWKHPXVFOHVLQRQHRIQDWXUH VPRVWLPSRUWDQWRIILFHV,WLV
QDWXUH VRZQIDYRULWHZD\RIGLVWULEXWLQJWRDOOSDUWVRIWKHERG\WKHQHUYHIRUFH
EHLQJDEVRUEHGLQWRWKHV\VWHP,WLVQDWXUH VRZQZD\RIVHQGLQJDYLWDOL]LQJDQG
LQYLJRUDWLQJFXUUHQWWRWKHSODFHVLQZKLFKLWLVQHHGHG$QGPRUHRYHULIZH
ZLOOWDNHKHUVHULRXVO\H[DPLQHWKHPHDQLQJRIKHUSURFHVVDQGWKHQ
LQWHOOLJHQWO\DSSO\WKHVDPHLQRXUZRUNRIGHYHORSLQJSK\VLFDOPDJQHWLVPZH
ZLOOKDYHJDLQHGDQLPSRUWDQWVHFUHWRIQDWXUHDQGRQHZKLFKZHZLOOQRWEH
ZLOOLQJWRSDUWZLWKRQFHLWLVDSSOLHGDQGWXUQHGWRDFFRXQW
,QWKHILUVWSODFHWKLVVWUHWFKLQJLVVRPHWKLQJIDUPRUHWKDQDPDQLIHVWDWLRQ
RIOD]LQHVVZHDULQHVVRUIDWLJXH,WLVDQLQVWLQFWLYHDFWLRQUHVXOWLQJIURP
QDWXUH VUHFRJQLWLRQRIWKHQHHGRIDIUHVKVXSSO\RIQHUYHIRUFHDQGKHUUXVKWR
VXSSO\WKHQHHGHGHQHUJ\'RQRWPLVWDNHDQGFRQIXVHFDXVHVDQGHIIHFWVLQWKLV
PDWWHU
<RXZLOOQRWLFHLQFDVHVRIFRPSOHWHVWUHWFKLQJDWZRIROGPRWLRQYL] 
$QH[WHQVLRQVDQG  DWHQVLQJRUFRQWUDFWLRQRIWKHPXVFOHVLQWKHGLUHFWLRQRI
GUDZLQJLQWKHH[WHQGHGOLPEVRUSDUWVRIWKHERG\1RZQRWHWKLVERWKRIWKHVH
PRWLRQVDUHIRUPVRIWHQVLQJRUFRQWUDFWLQJWKHPXVFOHV7KHH[WHQVLRQ
PRYHPHQWVUHVXOWIURPWKHWHQVLRQRUFRQWUDFWLQJRIWKHRSSRVLWHVHWRIPXVFOHV
7KHSULQFLSDOPXVFOHVRIWKHERG\DUHDUUDQJHGLQRSSRVLQJVHWVRQHEHLQJXVHG
WRSXVKRXWDQGWKHRWKHUWRGUDZLQWKHOLPERUSRUWLRQRIWKHERG\<RXPD\
DOZD\VFRXQWRQWKHSUHVHQFHRIWKHVHRSSRVLQJVHWVRIPXVFOHV:KHQLQWKH
SURFHVVRIVWUHWFKLQJ\RXILUVWH[WHQGDQGWKHQGUDZLQWKHOLPEV\RXUDOO\DUH
WHQVLQJERWKRIWKHRSSRVLQJVHWVLQWXUQ)RUZKDWSXUSRVH"/HWXVVHH
1DWXUH VSXUSRVHLQWHQVLQJWKHRSSRVLQJPXVFOHVLQWKHDERYHVWDWHGFDVH
VHHPVWREHWKDWRIVTXHH]LQJRXWVRPHWKLQJIURPWKHPXVFOHV$QGWKDWLV
H[DFWO\ZKDWLWLVȈDVTXHH]LQJRXWRIVRPHWKLQJ2IZKDW"2IWKHROGVWDOH
ZHDNHQHGQHUYHIRUFHRISK\VLFDOPDJQHWLVP:K\"Ȉ7RZKDWHQG"7RWKHHQG
WKDWWKHVXSSO\RIIUHVKYLWDOVWURQJQHUYHIRUFHRUSK\VLFDOPDJQHWLVPPD\UXVK
LQWRWDNHWKHSODFHWKHUHRI
7KLVLVHTXDOO\WUXHLQWKHFDVHRIWKHEUDLQH[KDXVWLRQQHUYHH[KDXVWLRQRU
PXVFOHH[KDXVWLQJȈIRUWKHEUDLQFHOOVWKHQHUYHVWKHPVHOYHVDQGWKHPXVFOHV
DUHNHSWYLWDOL]HGDQGLQYLJRUDWHGE\WKHVDPHIRUPRIHQHUJ\FRPLQJIURPWKH
VDPHVRXUFH0RUHRYHUWKHIUHVKVXSSO\RIQHUYHIRUFHSRXULQJLQWRWKHPXVFOHV
DQGFHOOVIURPWKHJUHDWQHUYHIRUFHUHVHUYRLUVRIWKHQHUYRXVV\VWHPOHDYHWKH
ODWWHUPRUHRUOHVVGHSOHWHGDQGFDXVHWKHPWRFDOOIRUDIUHVKDGHTXDWHVXSSO\
IURPWKHXQLYHUVDOVRXUFH,QVKRUWWKHVWUHWFKLQJSURFHVVVHWVLQWRRSHUDWLRQWKH
ZKROHPDFKLQHU\RIWKHGLVWULEXWLRQRIWKHV\VWHP VVXSSO\RIQHUYHIRUFHDQG
UHVXOWVLQWKHZKROHQHUYRXVPHFKDQLVPEHLQJJLYHDQHZLPSHWXV
UHVXOWVLQWKHZKROHQHUYRXVPHFKDQLVPEHLQJJLYHDQHZLPSHWXV
7KLVLVWKHVHFUHWRIWKHSHUVRQDOPDJQHWLVPDGHSW VPHWKRGRIGLVWULEXWLQJD
IUHVKVXSSO\RISK\VLFDOPDJQHWLVPRUQHUYHIRUFHWRDOOSDUWVRIWKHV\VWHPDW
ZLOOȈWKXVUHQGHULQJKLPVHOIDYHULWDEOHG\QDPRRISK\VLFDOPDJQHWLVPLIKHVR
GHVLUHV
%XWWKHUHLVPRUHWRWKLVPHWKRGRIWKHVWXGHQWWKDQPHUHRUGLQDU\
VWUHWFKLQJ,DVVXUH\RX7KHRUGLQDU\VWUHWFKLQJLVVLPSO\DQHOHPHQWDU\IRUP
RIQHUYHIRUFHGLVWULEXWLRQ,VKDOOFDOO\RXUDWWHQWLRQWRDQH[WHQVLRQRIDQG
LPSURYHPHQWXSRQWKHHOHPHQWDU\PHWKRG<RXKDYHSUREDEO\KHDUGRIWKDW
IURPRIFDOLVWKHQLFVJHQHUDOO\NQRZQDVWKHWHQVLQJH[HUFLVHV:HOOLQWKDW
V\VWHP\RXPD\ILQGWKHVHHGRIDPXFKPRUHHIILFLHQWV\VWHP7KHWHQVLQJ
V\VWHPRIFDOLVWKHQLFVLVWDXJKWIRUWKHSXUSRVHRIH[HUFLVLQJWKHPXVFOHVȈRQO\
WKLVDQGQRWKLQJPRUH,WKDVEHHQIRXQGWREULQJDERXWWKHJUHDWHVWUHVXOWVDQG
WRJUHDWO\GHYHORSWKHPXVFOHVDQGEHQHILWWKHJHQHUDOV\VWHP:K\"2KMXVW
H[HUFLVHUHSOLHVWKHSK\VLFDOFXOWXULVW%XWZHNQRZEHWWHUIRUZKLOHZHUHDOL]H
WKHEHQHILWREWDLQHGIURPWKHVHVHQVLEOHH[HUFLVHVDORQHZHDOVRXQGHUVWDQGKRZ
VXFKDUDWLRQDOFRXUVHRIH[HUFLVHPXVWUHVXOWLQJUHDWO\LQYLJRUDWLQJWKHHQWLUH
V\VWHPE\GLVWULEXWLQJWKHQHUYHIRUFHDQGDVDFRQVHTXHQFHEULQJLQJDERXWWKH
DEVRUSWLRQRIDIUHVKVXSSO\WRWKHJUHDWUHVHUYRLUFHQWHUVRIWKHQHUYRXVV\VWHP
GRZHQRW"
:HKDYHWKUHHGHFLGHGSRLQWVRIDGYDQWDJHRYHUWKHWHQVLQJH[HUFLVH
VFKRRODVIROORZV  :HSUHFHGHRXUWHQVLQJH[HUFLVHVE\UK\WKPLFEUHDWKLQJ
H[HUFLVHVWKXVEULQJLQJWRRXUUHVHUYRLUVDIUHVKVXSSO\RIPDJQHWLVPRU
QHUYHIRUFH  ZHSURFHHGOHLVXUHO\DQGDOPRVWOD]LO\RXULGHDEHLQJWKDWRI
VWUHWFKLQJDVRSSRVHGWRWKHLGHDRIYLJRURXVH[HUFLVHE\WHQVLQJWKHODWWHU
EHLQJKHOGE\WKHWHQVLQJH[HUFLVHVFKRRODQG  ZHXQGHUVWDQGWKHUHDO
UHDVRQIRUWKHWHQVLQJDQGKHQFHDUHDEOHWRDSSO\LWLQWHOOLJHQWO\LQVWHDGRILQD
KLWRUPLVVVW\OH
7KHDGGLWLRQRIWKHUK\WKPLFEUHDWKRIFRXUVHJLYHVDQHZDQGQRYHO
LPSHWXVWRWKHZRUNRIQHUYHIRUFHGLVWULEXWLRQLQIDFWWKHODWWHUFDQQRWEH
SHUIHFWO\SHUIRUPHGZLWKRXWWKHIRUPHU7KLVWKHRUGLQDU\WHQVLQJH[HUFLVH
SUDFWLWLRQHUDOPRVWHQWLUHO\PLVVHVH[FHSWLQVRIDUDVKHEHFRPHVIDWLJXHGE\
KLVYLJRURXVH[HUFLVHDQGLVIRUFHGWREUHDWKHUK\WKPLFDOO\DVDFRQVHTXHQFH
WKHUHE\XQFRQVFLRXVO\REWDLQLQJDWOHDVWVRPHRIWKHEHQHILWVRIWKHUK\WKPLF
EUHDWK7KHRUGLQDU\WHQVLQJH[HUFLVHVWXGHQWRQFHJLYHQRXUNH\RIWKH
UK\WKPLFEUHDWKLVHQDEOHGWRDWWDLQUHVXOWVLPSRVVLEOHWRKLPEHIRUH+HVHHVD
JUHDWOLJKWDVDFRQVHTXHQFH
0\VWXGHQWVRISHUVRQDOPDJQHWLVPSURFHHGDERXWWKHH[HUFLVHVIRU
GLVWULEXWLRQRIQHUYHIRUFHRUSK\VLFDOPDJQHWLVPLQDQHQWLUHO\GLIIHUHQWPDQQHU
IURPWKDWRIWKHRUGLQDU\SUDFWLWLRQHURIWKHWHQVLQJH[HUFLVHV\VWHPV7KHODWWHU
IURPWKDWRIWKHRUGLQDU\SUDFWLWLRQHURIWKHWHQVLQJH[HUFLVHV\VWHPV7KHODWWHU
ZRUNWKHPVHOYHVLQWRDQH[KDXVWHGFRQGLWLRQXQGHUWKHEHOLHIWKDWWKHLUPXVFOHV
ZLOOEHFRPHEHWWHUGHYHORSHGE\VXFKYLJRURXVH[HUFLVH$VDFRQVHTXHQFH
PDQ\RIWKHPZHDURXWDVPXFKDVWKH\DFTXLUHRIPXVFXODUGHYHORSPHQW0\
VWXGHQWVLQVWHDGSXUVXHDQ\WKLQJEXWDVWUHQXRXVFRXUVHRIH[HUFLVLQJLQ
WHQVLQJ,QVWHDGRIPRYLQJYLJRURXVO\WKH\SURFHHGVORZO\FDOPO\DQGDOPRVW
OD]LO\LQWHQVLQJWKHPXVFOHVLQWXUQH[WHQGLQJDQGWKHQGUDZLQJLQ7KH\NHHS
EHIRUHWKHPDOOWKHWLPHQDWXUH VRZQSURFHVVHVRIVWUHWFKLQJDQGPRGHOWKHLU
PRYHPHQWVHQWLUHO\XSRQWKHVDPH,QWKLVZD\DVDFRQVHTXHQFHWKHUHLQQR
H[KDXVWLRQRUXVLQJXSRIQHUYHIRUFHRUWLVVXHWRDQ\PDUNHGH[WHQWEXWRQWKH
FRQWUDU\WKHUHLVDFRQVWDQWWDNLQJLQDQGGLVWULEXWLRQRIPDJQHWLVPIURPWKH
FHQWHUVWRWKHSDUWVDQGFRQVHTXHQWO\DPDUNHGLQFUHDVHLQYLJRUYLWDOLW\DQG
YLP7KHGLIIHUHQFHFDQEHXQGHUVWRRGSHUIHFWO\RQO\ZKHQRQHSUDFWLFHVP\
H[HUFLVHVIRUKLPVHOIRUKHUVHOI
)LQDOO\LWIROORZVWKDWDPXFKJUHDWHUHIIHFWLVREWDLQHGE\RQHZKRSUDFWLFHV
DQ\IRUPRIH[HUFLVHVXQGHUVWDQGLQJO\DQGZLWKIXOONQRZOHGJHRIWKHZK\DV
ZHOODVWKHKRZRIWKHWKLQJȈRIWKHWKHRU\DVZHOODVWKHSUDFWLFH:KHQRQH
NQRZVMXVWZKDWKHLVDERXWDQGMXVWZKDWKHZLVKHVDQGH[SHFWVWRREWDLQWKHQ
KHKDVJDLQHGKDOIRIWKHEDWWOH/DFNLQJWKLVNQRZOHGJHKHZDVWHVHQHUJ\DQG
HIIRUWDQGGRHVPXFKWKDWKDGEHWWHUEHOHIWXQGRQHZKLOHOHDYLQJXQGRQHPXFK
WKDWVKRXOGEHGRQH9HULO\NQRZOHGJHLVSRZHULQWKLVFDVHDVLQPDQ\
RWKHUV
,WLVVRPHZKDWDPXVLQJWKRXJKVDGWRVHHWKHVHWHQVLQJH[HUFLVHSHRSOH
XVLQJWKHPVHOYHVXSLQYLJRURXVH[HUFLVLQJDQGDWWKHVDPHWLPHORVLQJ
QLQHWHQWKVRIWKHEHQHILWVJDLQHGE\WKRVHSUDFWLFLQJWKHOD]\VWUHWFKLQJ
H[HUFLVHVDFFRPSDQLHGE\WKHUK\WKPLFEUHDWKDVWDXJKWWRP\VWXGHQWV
&KDSWHU
1HUYH)RUFH([HUFLVHV
7DEOHRI&RQWHQW

,VKDOOQRZLQVWUXFW\RXLQWKHGLUHFWLRQRIFHUWDLQIRUPVRIH[HUFLVHGHVLJQHGWR
JHQHUDWHQHUYHIRUFHRUSK\VLFDOPDJQHWLVPERWKLQWKHSKDVHRIDEVRUSWLRQDQG
WKDWRIGLVWULEXWLRQDFFRUGLQJWRWKHJHQHUDOSULQFLSOHVVHWIRUWKLQWKHSUHFHGLQJ
FKDSWHUV
$EVRUSWLRQ7KHH[HUFLVHVWKHPVHOYHVDUHGHVLJQHGWRJLYHDIUHHDQGIXOO
GLVWULEXWLRQWRWKHQHUYHIRUFHRUSK\VLFDOPDJQHWLVPEXWWKHVWXGHQWPXVW
DOZD\VUHPHPEHUWKDWEHIRUHWKHQHUYHIRUFHPD\EHGLVWULEXWHGLWPXVWILUVWEH
DEVRUEHG7KHDEVRUSWLRQRIFRXUVHLVSHUIRUPHGE\PHDQVRIWKHEUHDWKUK\WKP
DFFRUGLQJWRWKHLQVWUXFWLRQDOUHDG\JLYHQ\RX
,03257$175HPHPEHUWKDWHYHU\VHULHVRIGLVWULEXWLRQH[HUFLVHVPXVWEH
SUHFHGHGDQGIROORZHGE\WKHSUDFWLFHRIWKHUK\WKPLFEUHDWKIRUDIHZ
PRPHQWV,WZLOODOVREHIRXQGEHQHILFLDODQGXVHIXOWRLQWHUMHFWDVKRUWSHULRGRI
UK\WKPLFEUHDWKLQJLQEHWZHHQWKHVHH[HUFLVHVIURPWLPHWRWLPH<RXZLOOVRRQ
GLVFRYHUWKHQHHGRIWKLVIURP\RXURZQIHHOLQJV$IWHU\RXKDYHJDLQHG
IDPLOLDULW\DQGHDVHLQSUDFWLFLQJWKHGLVWULEXWLRQH[HUFLVHV\RXZLOOILQG
\RXUVHOIEHFRPLQJYHU\VHQVLWLYHWRWKHLQIORZRIWKHQHUYHIRUFHGXULQJWKH
EUHDWKUK\WKPH[HUFLVHDQGLQDVKRUWWLPHZLOONQRZE\\RXUIHHOLQJVH[DFWO\
ZKHQ\RXQHHGWRDEVRUEPRUHQHUYHIRUFHGXULQJWKHH[HUFLVH
$WWKLVSRLQW,ZLVKWRDJDLQUHPLQGWKHVWXGHQWWKDWRQHRIWKHPDLQIHDWXUHV
RIP\QHUYHIRUFHH[HUFLVHVLVWKDWRIWKHHQWLUHDEVHQFHRIDUWLILFLDOLW\DQGWKH
SUHVHQFHRIQDWXUDOQHVV,GRQRWJLYHVHWIRUPVRIEUHDWKLQJWREHSUDFWLFHG
MXVWVRRIWHQIRUVRPDQ\PLQXWHVDWDWLPH,QVWHDG,JLYHWKHJHQHUDOSULQFLSOHV
RIWKHPHWKRGȈWKHZK\DVZHOODVWKHKRZȈDQGWKHQELGWKHVWXGHQWWREH
JRYHUQHGHQWLUHO\E\KLVRZQLQVWLQFWVLQWKHPDWWHURIWKHGXUDWLRQRIH[HUFLVHV
DQGIUHTXHQF\RIWKHVDPH
$IWHUDVKRUWWLPHWKHVWXGHQWZLOOIDOOLQWRWKHQDWXUDOKDELWMXVWDVKHGRHV
LQWRWKHKDELWVRIHDWLQJDQGGULQNLQJDQGKHZLOONQRZH[DFWO\ZKHQKHVKRXOG
SUDFWLFHQHUYHIRUFHJHQHUDWLRQDQGKRZORQJKHVKRXOGFRQWLQXHWKHH[HUFLVHV
.HHSWKHZRUGV%H1DWXUDOEHIRUH\RXUPLQGDQG\RXZLOOPDNHQR
PLVWDNH1HYHURYHUGRWKHH[HUFLVHVRUIRUFH\RXUVHOIWRSHUIRUPWKHPZKHQ
\RXGRQRWIHHOOLNHLW$YRLGDQ\WKLQJDSSURDFKLQJDUWLILFLDOLW\LQWKHPDWWHU
6RPHWLPHV\RXPD\JRDORQJWLPHZLWKRXWSUDFWLFLQJDQGDJDLQ\RXPD\IHHO
6RPHWLPHV\RXPD\JRDORQJWLPHZLWKRXWSUDFWLFLQJDQGDJDLQ\RXPD\IHHO
WKHQHHGRIWKHVDPHYHU\RIWHQȈLQHLWKHUFDVHIROORZQDWXUH VXUJLQJV$JDLQ
\RXPD\IHHOOLNHWDNLQJEXWDPRPHQW VH[HUFLVHVDWDWLPHȈOLNHWDNLQJDVLSRI
ZDWHUZKLOHRQRWKHURFFDVLRQV\RXZLOOIHHOOLNHWDNLQJDORQJVSHOORIH[HUFLVH
ȈOLNHWDNLQJDGHHSGUDXJKWRIZDWHUZKHQ\RXKDSSHQWREHYHU\WKLUVW\Ȉ
IROORZQDWXUHLQERWKLQVWDQFHV
675(7&+,1*(;(5&,6(,ZLOOEHJLQE\FDOOLQJ\RXUDWWHQWLRQWRDIRUP
RIH[HUFLVHZKLFKFRQVLVWVRILQWHOOLJHQWVLPSOHVWUHWFKLQJEXWZKLFKIRUPRI
H[HUFLVHZLOOEHIRXQGYHU\EHQHILFLDO7KHUHDUHDYDULHW\RIIRUPVRIWKLV
H[HUFLVH,ZLOOJLYH\RXDIHZJHQHUDOIRUPVDQG\RXPD\WKHQHQODUJHRQWKHVH
DQGLQYHQWFRPELQDWLRQVYDULDWLRQVHWF
,/\LQJRQ\RXUEDFNH[WHQG\RXUDUPVXSZDUGRYHU\RXUKHDGWRWKHLUIXOO
H[WHQWȈVWUHWFKWKHPRXWHDVLO\EXWWKRURXJKO\DVIDUDVWKH\ZLOOJR7KHQ
VORZO\SXOOWKHPLQ5HSHDWVHYHUDOWLPHV
,,6WUHWFKWKHDUPVVLGHZD\VIURPWKHERG\ȈRXWDQGWKHQLQVHYHUDOWLPHV
,,,6WUHWFKWKHOHJVLQWKHVDPHZD\VHYHUDOWLPHV
,96WUHWFKWKHQHFNVHYHUDOWLPHV
96WUHWFKWKHKDQGDQGILQJHUVE\PRYLQJWKHKDQGVEDFNZDUGDQGIRUZDUG
IURPWKHZULVWFOHQFKLQJDQGXQFOHQFKLQJWKHILVWRSHQLQJDQGFORVLQJWKH
ILQJHUV
9,6WUHWFKWKHIHHWDQGWRHVLQWKHVDPHJHQHUDOPDQQHUDVLQWKHFDVHRIWKH
KDQGVDQGILQJHUV
9,,7XUQRYHUDQGOLHRQ\RXUVWRPDFKZLWKWKHIDFHGRZQRQWKHSLOORZRU
IORRUDQGUHSHDWWKHDERYHH[HUFLVHLQWKLVSRVLWLRQ7KLVZLOOEULQJLQWRSOD\D
QXPEHURIPXVFOHVQRWHPSOR\HGLQWKHIRUPHUSRVLWLRQ
9,,,5LVHWR\RXUIHHWDQGVWDQGZLWKWKHOHJVVSUHDGRXWWKHIHHWVHYHUDOIHHW
DSDUWZLWKDUPVH[WHQGHGXSZDUGDQGRXWZDUG7KLVZLOOEULQJ\RXUERG\LQWR
WKHJHQHUDOVKDSHRIWKHOHWWHU;7KHQULVHWR\RXUWRHVDQGVWUHWFKXSZDUGDV
LI\RXZHUHWU\LQJWRWRXFKWKHFHLOLQJ
5HSHDWVHYHUDOWLPHV
<RXZLOOEHVXUSULVHGDWWKHIHHOLQJRIUHVWDQGUHQHZHGVWUHQJWKZKLFKZLOO
FRPHWR\RXDVWKHUHVXOWRIWKHSUDFWLFLQJRIWKHDERYHVLPSOHVWUHWFKLQJ
H[HUFLVHV$QG\HWVLPSOHDVWKH\DUHWKHVHH[HUFLVHVSHUIRUPDJUHDWZRUN<RX
PXVWQRWORVHVLJKWRIWKHIDFWWKDWZKHQ\RXWHQVHWKHVHPXVFOHVLQWKHDFWRI
VWUHWFKLQJDQGWKHQFRQWUDFWLQJWKHOLPEV\RXUHDOO\VTXHH]HRXWWKHROGZRUQ
RXWGHSOHWHGPDJQHWLVPDQGDEVRUELQLWVSODFHDIUHVKVXSSO\RIYLJRUYLWDOLW\
DQGYLPIURPWKHJUHDWUHVHUYRLUVRIWKHQHUYRXVV\VWHP
&DUU\LQ\RXUPLQGWKHLGHDRIWKHVSRQJHZKLFKLQRUGHUWRDEVRUEIXOO\D
VXSSO\RIIUHVKZDWHUPXVWILUVWEHWKRURXJKO\VTXHH]HGRXW7KHSURFHVVRIWKH
DEVRUSWLRQDQGGLVWULEXWLRQRIQHUYHIRUFHLVYHU\FORVHLQGHHGWRWKHSURFHVVRI
WKHVTXHH]LQJRXWDQGUHILOOLQJRIWKHVSRQJH7KHIROORZLQJWHQVLQJH[HUFLVHV
WKHVTXHH]LQJRXWDQGUHILOOLQJRIWKHVSRQJH7KHIROORZLQJWHQVLQJH[HUFLVHV
DUHUHDOO\EXWDQH[WHQVLRQRIWKHVWUHWFKLQJH[HUFLVHVPRUHHODERUDWHDQG
FRPSOLFDWHGEXWHPERG\LQJWKHVDPHSULQFLSOH7KH\DUHXVHIXOLQHQHUJL]LQJ
WKHVHYHUDOSDUWVRIWKHERG\ZKLFKDUHQRWDFWLYHO\HQHUJL]HGE\WKHVLPSOH
VWUHWFKLQJH[HUFLVHV
6KRXOGHUVDQG&KHVW6WDQGHUHFWIHHWFORVHWRJHWKHUDUPVDWVLGHV7KHQ
GUDZIRUZDUG\RXUVKRXOGHUVDVIDUIURQWDVWKH\ZLOOJR+ROGWKHSRVLWLRQD
PRPHQWDQGWKHQVORZO\SUHVVWKHVKRXOGHUVEDFNDVIDUDVWKH\ZLOOJR7KLV
ZLOOWHQGWRHQHUJL]HWKHVKRXOGHUVDQGFKHVW
7KHFKHVWPD\DOVREHHQHUJL]HGE\WDNLQJDIHZGHHSIXOOEUHDWKVZKLFK
ZLOOLQIODWHWKHOXQJVDQGWKXVH[WHQGWKHFKHVW7KHVKRXOGHUVPD\DOVREH
HQHUJL]HGE\UDLVLQJWKHPXSZDUGLQDVKUXJDQGWKHQVORZO\ORZHULQJWKHPWR
RULJLQDOSRVLWLRQ
$UPV:ULVWVDQG+DQGV$Q\VLPSOHH[HUFLVHZKLFKZLOOH[WHQGDQGWKHQ
FRQWUDFWWKHDUPPXVFOHVZLOOVHUYHWRHQHUJL]HWKHDUPV7ZLVWLQJWKHPILUVW
RQHZD\DQGWKHQDQRWKHUZLOOGROLNHZLVH7ZLVWLQJWKHZULVWDQGPRYLQJWKH
KDQGVORRVHO\EDFNZDUGDQGIRUZDUGIURPWKHZULVWWHQGVWRHQHUJL]HVHYHUDO
YHU\LPSRUWDQWPXVFOHVDQGQHUYHVLQWKLVSDUWRIWKHERG\
&OHQFKLQJDQGXQFOHQFKLQJWKHKDQGVZLOOHQHUJL]HWKHKDQGVDQGILQJHUV
6SUHDGLQJRXWWKHILQJHUVIDQVKDSHDQGWKHQGUDZLQJWKHPWRJHWKHUZLOO
HQHUJL]HWKHILQJHUVWKRURXJKO\
/HJV)HHWDQG7RHV)ROORZWKHJHQHUDOLGHDRIWKHDUPDQGKDQGH[HUFLVHV
MXVWPHQWLRQHGLQWKHFDVHRIWKHOHJVIHHWDQGWRHV6TXDWWLQJHQHUJL]HVWKH
WKLJKV5DLVLQJXSWKHWRHVDQGWKHQORZHULQJWRRULJLQDOSRVLWLRQHQHUJL]HVWKH
FDOYHVRIWKHOHJV7KHVWDQGLQJVWLOOUXQLVDJRRGJHQHUDOOHJHQHUJL]HU
1HFN0RYHWKHQHFNIRUZDUGDVIDUDVLWZLOOJRWKHQEDFNZDUGDVIDUDVLW
ZLOOJRWKHQVLGHZD\VWRWKHULJKWDVIDUDVLWZLOOJRȈWKHQWRWKHOHIWLQWKH
VDPHZD\WKHQWZLVWWRWKHULJKWDVIDUDVLWZLOOJRWKHQWRWKHOHIWLQWKHVDPH
PDQQHU7KHVHDUHVSOHQGLGQHFNHQHUJL]HUV7KHUHDUHLPSRUWDQWQHUYHVUXQQLQJ
WKURXJKWKHQHFNZKLFKDUHHQHUJL]HGE\WKHVHH[HUFLVHV
7ZLVWLQJDQG%HQGLQJ:KDWPD\EHFDOOHGDWZLVWLQJRIWKHGLIIHUHQWSDUWV
RIWKHERG\VHUYHVWRHQHUJL]HWKHSDUWVYHU\ZHOOLQGHHG,QWKHVDPHZD\
EHQGLQJH[HUFLVHVDUHJRRG
1RWRQO\PD\WKHOHJVDQGDUPVEHWZLVWHGHDVLO\DQGHIIHFWLYHO\EXWWKH
HQWLUHWUXQNRIWKHERG\PD\EHHTXDOO\HIIHFWLYHO\WZLVWHGE\VWDQGLQJHUHFW
ZLWKIHHWVD\HLJKWRUWHQLQFKHVDSDUWWRHVRXWDQGDUPVKDQJLQJHDVLO\E\WKH
VLGHVWKHQHDVLO\WZLVWLQJWKHERG\WRWKHULJKWWKHQHFNWUXQNDQGWKLJKVEHLQJ
FDUULHGDVIDUDVWKH\ZLOOJRWKHQWZLVWLQJWRWKHOHIWLQWKHVDPHPDQQHU
UHSHDWLQJVHYHUDOWLPHV%HQGLQJWKHERG\WRWKHULJKWWKHQWRWKHOHIWWKHQ
IRUZDUGWKHQEDFNZDUGLVDJRRGHQHUJL]HU
IRUZDUGWKHQEDFNZDUGLVDJRRGHQHUJL]HU
,QD1XWVKHOO7KHIRUHJRLQJH[HUFLVHVPLJKWEHHODERUDWHGLQWRDERRNE\
LWVHOIȈEXWZKDW VWKHXVH",KDYHJLYHQ\RXLQDQXWVKHOOWKHPDLQHOHPHQWVRI
WKHH[HUFLVHVDQG\RXPD\GRWKHHODERUDWLQJ\RXUVHOI,QIDFW,FDQVXPXSWKH
JHQHUDOSULQFLSOHVRIWKHH[HUFLVHVLQWKUHHZRUGVYL]675(7&+,1*
7:,67,1*$QG%(1',1*7KLQNRYHUWKHVHWKUHHZRUGVDQG\RXZLOOVHH
WKDWLI\RXZLOODSSO\WKHPLQHYHU\SRVVLEOHZD\WRWKHYDULRXVSDUWVRIWKH
ERG\\RXZLOOKDYHDZKROHV\VWHPRIWHQVLQJH[HUFLVHVDW\RXUFRPPDQG
ZLWKRXWSXUFKDVLQJH[SHQVLYHWH[WERRNVRQWKHVXEMHFW$QGDOVRUHPHPEHU
WKDWLQDQ\DQGDOORIWKHVRFDOOHGWHQVLQJH[HUFLVHVV\VWHPVLVWREHIRXQGWKH
EHVWSRVVLEOHSULQFLSOHRIQHUYHIRUFHGLVWULEXWLRQȈDOZD\VKRZHYHU
UHPHPEHULQJWRLQFOXGHWKHUK\WKPLFEUHDWKLQJDFFRUGLQJWRP\SUHYLRXVO\
JLYHQLQVWUXFWLRQV1RZJHWWRZRUNDQGH[HUFLVH\RXULQJHQXLW\LQGHYLVLQJ
YDULDWLRQVDQGFRPELQDWLRQVRIWKHVWUHWFKLQJWZLVWLQJDQGEHQGLQJSULQFLSOHV
7KLVZLOOHQHUJL]H\RXUPLQGDVZHOODV\RXUERG\
(QHUJL]LQJWKH6RODU3OH[XV7KH6RODU3OH[XVOLHVH[DFWO\EHKLQGWKHSLWRI
WKHVWRPDFK,WPD\EHHQHUJL]HGE\SUDFWLFLQJDGUDZLQJLQRIWKHDEGRPLQDO
PXVFOHV7KLVPD\SURYHDOLWWOHGLIILFXOWDWILUVWEXWDOLWWOHSUDFWLFHZLOOPDNH
SHUIHFW'UDZWKHDEGRPLQDOPXVFOHVLQZDUGDQGXSZDUGVHYHUDOWLPHVDWHDFK
H[HUFLVH
7KH6DFUDO3OH[XV7KH6DFUDO3OH[XVLVDQRWKHULPSRUWDQWSOH[XVRUJUHDW
FHQWHURIQHUYHIRUFH,WLVORFDWHGLQIURQWRIWKHORZHUSDUWRIWKHVSLQDOFROXPQ
ȈLQWKHUHJLRQRIWKHKLSV,WPD\EHHQHUJL]HGE\DVSHFLDOVWUHWFKLQJEHQGLQJ
DQGWZLVWLQJRIWKDWSDUWLFXODUUHJLRQRIWKHERG\
,QFDVHRILPSDLUHGYLWDOLW\RUJHQHUDOZHDNQHVVDOLWWOHH[WUDHQHUJL]LQJRI
WKHVHWZRSOH[XVPD\EHIRXQGYHU\DGYDQWDJHRXVDQGEHQHILFLDODVWKH\
GLUHFWO\DIIHFWODUJHUHJLRQVRIWKHERG\DQGLPSRUWDQWRUJDQV
&KDSWHU
3URMHFWLQJ1HUYH)RUFH
7DEOHRI&RQWHQW

$WWKHEHJLQQLQJRI&KDSWHU,9,VWDWHGWKDWWKHSK\VLFDOSKDVHRISHUVRQDO
PDJQHWLVPGHSHQGVXSRQWZRFRRUGLQDWHGPDQLIHVWDWLRQVRIQHUYHIRUFH
QDPHO\  7KHJHQHUDWLRQRIQHUYHIRUFHDQG  WKHFRQVFLRXVSURMHFWLRQE\
WKHZLOORIWKDWVXSSO\RIQHUYHIRUFHLQWRWKHSHUVRQDODWPRVSKHUHDQGHYHQWR
DJUHDWHUGLVWDQFHXQGHUVSHFLDOFRQGLWLRQV,KDYHLQVWUXFWHG\RXUHJDUGLQJWKH
SKDVHRIQHUYHIRUFHJHQHUDWLRQ/HWXVQRZFRQVLGHUWKHVHFRQGSKDVHLHWKDW
RIWKHSURMHFWLRQRIWKHVDPH
2IDOORIWKHPHQWDOIRUFHVRIWKHLQGLYLGXDOWKHZLOOLVWKHPRVWSRZHUIXO
DQGDWWKHVDPHWLPHWKHRQHOHDVWXQGHUVWRRG,WLVKDUGHYHQWRGHILQHWKHZLOO
(QRXJKIRURXUSXUSRVHWRUHDOL]HWKDWLWLVWKHSRZHUZLWKLQWKHPLQGZKHUHE\
PDQLVDEOHWRGRWKLQJV1RWRQO\GRHVPDQGRWKHRUGLQDU\WKLQJVRIOLIHE\
PHDQVRIWKHZLOOEXWDOVRKHLVDEOHWRGRVRPHH[WUDRUGLQDU\WKLQJVZKHQKH
OHDUQVKRZ
7KHROGRFFXOWLVWIXOO\UHDOL]HGWKHPLJKW\SRZHURIWKHZLOORIPDQDQG
WKHLUWHDFKLQJVFRQYH\VRPHYHU\YDOXDEOHLQIRUPDWLRQRQWKLVVXEMHFW2QHRI
WKHLUWHDFKLQJVZDVWKDWE\WKHXVHRIKLVZLOOPDQLVDEOHQRWRQO\WRSURMHFW
WKRXJKWZDYHVIURPKLVPHQWDOLW\EXWWKDWKHLVDOVRDEOHWRFRQVFLRXVO\SURMHFW
KLVSK\VLFDOPDJQHWLVPRUYLWDOHQHUJ\LQWKHVDPHZD\7KHGLVFRYHULHVRIWKH
PRVWDGYDQFHGVWXGHQWVRIWKHVXEMHFWLQRXUWLPHVYHULI\WKHROGWHDFKLQJVRI
WKHRFFXOWLVWVLQWKLVUHVSHFW7KHV\VWHP,DPKHUHLQWHDFKLQJLVWKHUHIRUHEDVHG
QRWRQO\RQWKHDGYDQFHGGLVFRYHULHVRIPRGHUQVFLHQFHEXWDOVRXSRQWKH
ZRUOGROGWHDFKLQJVRIWKHDQFLHQWRFFXOWLVWV7UXWKNQRZVQRVSHFLDODJHRUWLPH
ȈLWLVWKHSURSHUW\RIWKHDJHV
7KHDYHUDJHPDQSURMHFWVKLVSK\VLFDOPDJQHWLVPRUQHUYHIRUFHLQWRKLV
SHUVRQDODWPRVSKHUHRUDXUDPRUHRUOHVVXQFRQVFLRXVO\ȈMXVWDVKHZDONVRU
EUHDWKHVIRUWKDWPDWWHU+HKDVQDWXUDOO\DFTXLUHGWKHKDELWDQGGRHVQRW
FRQFHUQKLPVHOIDERXWWKHPDWWHUȈLQIDFWKHLVXVXDOO\XQFRQVFLRXVRIDQG
LJQRUDQWRIWKHSURFHVVLWVHOI7KHGLIIHUHQFHVLQWKHGHJUHHRISK\VLFDO
PDJQHWLVPSURMHFWHGRUUDGLDWHGE\VXFKSHUVRQVLVGHWHUPLQHGVROHO\E\WKH
GHJUHHRIQHUYHIRUFHJHQHUDWHGE\WKHPLQDEVHQFHRIDQ\VSHFLDOSRZHURI
SURMHFWLRQ
7KHUHLVDVHFRQGFODVVKRZHYHUWKHPHPEHUVRIZKLFKZKLOHQRWIXOO\
7KHUHLVDVHFRQGFODVVKRZHYHUWKHPHPEHUVRIZKLFKZKLOHQRWIXOO\
LQIRUPHGRIWKHLUSRZHUWRSURMHFWSK\VLFDOPDJQHWLVPQHYHUWKHOHVVE\WKHLU
KDELWXDOXVHRIWKHZLOOLQWKHGLUHFWLRQRILPSUHVVLQJRWKHUVSRZHUIXOO\WKRXJK
XQFRQVFLRXVO\GLUHFWZDYHVRIWKHQHUYHIRUFHRXWZDUGVRWKDWWKHLUSHUVRQDO
DWPRVSKHUHEHFRPHVZHOOFKDUJHGZLWKLWDQGWKHLULQIOXHQFHLVIHOWE\WKRVH
FRPLQJLQFRQWDFWZLWKLW,QWKLVFODVVRILQGLYLGXDOVZLOOEHIRXQGWKHDFWLYH
HQHUJHWLFPDVWHUIXOPHQLQYDULRXVZDONVRIOLIHZKRGLUHFWRWKHUVUDWKHUWKDQ
DUHGLUHFWHGE\RWKHUVZKRJLYHRUGHUVUDWKHUWKDQUHFHLYHWKHP7KHVHPHQ
JHQHUDOO\UDGLDWHHQRXJKSK\VLFDOPDJQHWLVPWRPDNHLWVHOIIHOWE\WKRVHZLWK
ZKRPWKH\FRPHLQFRQWDFWDQGDUHJHQHUDOO\IHOWWREHVWURQJPHQ%XWHYHQ
WKHVHSHUVRQVGRQRWPDQLIHVWWKHJUHDWHVWDPRXQWRISK\VLFDOPDJQHWLVP
7KHWKLUGFODVVRISHUVRQVLVWKDWFRPSRVHGRILQGLYLGXDOVZKRKDYHDFTXLUHG
DJUHDWHURUOHVVNQRZOHGJHRIIDFWWKDWSK\VLFDOPDJQHWLVPPD\EHSURMHFWHG
EH\RQGWKHOLPLWVRIWKHEUDLQRUERG\DQGZKRKDYHOHDUQHGDWOHDVWLQD
GHJUHHWKHDUWRIVRSURMHFWLQJLWE\WKHXVHRIWKHZLOO7KHVHLQGLYLGXDOVUDQJH
IURPWKRVHZKRKDYHDFTXLUHGPHUHO\DJOLPSVHRIWKHWUXWKXSE\GHJUHHVWR
WKRVHZKRPD\EHVSRNHQRIDV0DVWHUVRIWKH$UW7KLVODVWQDPHGFODVVRI
SHUVRQVDUHWKRVHZKRVHSRZHULVUHDGLO\IHOWDQGDFNQRZOHGJHGDQGZKROHDYH
WKHLULPSUHVVLRQXSRQWKRVHZKRFRPHLQFRQWDFWZLWKWKHP
7KHSURMHFWLRQRIWKHSK\VLFDOPDJQHWLVPE\WKHZLOOLVLQDZD\DYHU\
VLPSOHSURFHGXUHFRQVLVWLQJRIWZRSURFHVVHVDVIROORZV  7KHEHOLHILQRU
UHDOL]DWLRQRIRQH VSRZHUVWRVRSURMHFWWKHIRUFHDQG  WKHDFWXDOZLOOLQJRU
FRPPDQGLQJWKHIRUFHWREHSURMHFWHG
$WILUVWLWPD\VHHPVRPHZKDWVWUDQJHWROHDUQWKDWEHOLHIKDVDQ\WKLQJWR
GRZLWKWKLVPDWWHUEXWDOLWWOHFRQVLGHUDWLRQZLOOH[SODLQWKLVJHQHUDOODZRI
SV\FKRORJ\,WLVWKLVZD\7KHZLOOQHYHUDFWVLQDGLUHFWLRQZKLFKWKHPLQG
EHOLHYHVLPSRVVLEOH2QHQHYHUWULHVWRUHDFKWKHPRRQEHFDXVHKLVPLQGUHIXVHV
WREHOLHYHWKDWKHFDQGRLWȈEXWWKHFKLOGEHOLHYLQJWKDWLWLVSRVVLEOHZLOOXVH
KLVZLOOWRPRYHKLVKDQGLQWKDWGLUHFWLRQ7KHGLVEHOLHIDFWVDVDEUDNHRQWKH
ZLOOȈGR\RXVHHWKHSRLQW"
%XW\RXPD\VD\WKHEHOLHIRIWKHFKLOGGRHVQRWHQDEOHKLPWRUHDFKWKH
PRRQ&HUWDLQO\QRWEXWLWFDXVHGKLVZLOOWRRSHUDWHVRDVWRPRYHWKHKDQG
%HOLHIGRHVQRWQHFHVVDULO\UHQGHUDFFRPSOLVKPHQWFHUWDLQȈEXWLWUHPRYHVWKH
EDUULHUVRIGLVEHOLHIWKHODWWHUSUHYHQWLQJDQ\DFFRPSOLVKPHQWE\WKHZLOO7KHUH
DUHPDQ\WKLQJVWKDWZHZRXOGEHDEOHWRGRLIZHFRXOGRQO\EHOLHYHWKDWZH
FRXOGGRȈEXWGLVEHOLHIDFWVDVDEUDNHDQGDEDUULHUWRWKHHIIRUWVRIWKHZLOO
5HDOL]DWLRQRIRQH VSRZHUZLOORIWHQJDLQKDOIWKHEDWWOHRIDFFRPSOLVKPHQWIRU
KLP
,QWKHFDVHEHIRUHXVWKHRQHQHHGVRQO\WREHOLHYHHQRXJKWRPDNHWKH
DWWHPSW7KHQHDFKWLPHWKHDWWHPSWLVPDGHDQGRQHSHUFHLYHVDUHVXOWWKHWDVN
EHFRPHVHDVLHUIRUWKHQH[WWLPH$QGDWODVWWKHVHQVHRIIXOOUHDOL]DWLRQRIWKH
EHFRPHVHDVLHUIRUWKHQH[WWLPH$QGDWODVWWKHVHQVHRIIXOOUHDOL]DWLRQRIWKH
SRZHURIWKHZLOOGDZQVXSRQWKHSHUVRQDQGDIWHUWKDWWKHUHVWLVHDV\
7KHVHFRQGSURFHVVLHWKHDFWXDOZLOOLQJRUFRPPDQGLQJE\WKHZLOOLV
VLPSO\ZKDWWKHZRUGVDFWXDOO\VD\+RZFDQ\RXZLOORUFRPPDQGWKH
SK\VLFDOPDJQHWLVPWRPRYHLQWR\RXUSHUVRQDODWPRVSKHUHDQGHQHUJL]HLW"Ȉ
:LOOLWREH\PH"\RXDVN&HUWDLQO\LWZLOO$QGWKHZLOOLQJRUFRPPDQGLQJLV
VLPSO\HIIRUWWKHVDPHWKDW\RXHPSOR\LQVWLQFWLYHO\ZKHQ\RXZLOORU
FRPPDQGWKDW\RXUKDQGEHUDLVHG:KDWPDNHVWKHKDQGULVH",WKDVQRSRZHU
WRUDLVHLWVHOIQHLWKHUKDYHWKHPXVFOHVDQ\VXFKSRZHULQWKHPVHOYHV,WLVRQO\
ZKHQ\RX:,//LWWRPRYHWKDWWKLQJVEHJLQWRPRYH7KHPHUHZLOOLQJVHQGVD
FXUUHQWRIQHUYHIRUFHRYHUWKHQHUYHVDQGLQWRWKHPXVFOHVDQGWKHKDQGULVHV
6RXQGVVLPSOHGRHVQ WLW"$QG\HWLWLVRQHRIWKHPRVWZRQGHUIXOWKLQJVLQWKH
ZRUOGȈRQO\ZHKDYHJURZQVRDFFXVWRPHGWRLWWKDWZHIDLOWRQRWHWKHZRQGHU
RILWDOO
7KHFRPPDQGRIWKHZLOOWRWKHSK\VLFDOPDJQHWLVPDFWVLQWKHVDPHPDQQHU
DVWKHFRPPDQGRIWKHZLOOWRWKHKDQG1RZULJKWKHUHLVDSRLQWWREH
UHPHPEHUHG<RXGRQRWPHUHO\VD\WRWKHKDQGUDLVHXS7U\LWRQ\RXURZQ
KDQGȈVD\WRLWUDLVHXSZLWKRXWDFWXDOO\ZLOOLQJLWWRULVHDQGQRWKLQJ
KDSSHQVLWLVRQO\ZKHQ\RXDFFRPSDQ\WKHFRPPDQGZLWKWKHP\VWHULRXV
HIIRUWRIWKHZLOOWKDWPRYHPHQWRFFXUV
,FDQQRWWHOO\RXKRZWRPRYH\RXUKDQGE\ZLOOLQJȈDOOWKDW,FDQVD\LVWKDW
\RXPXVW:,//LWWRULVHDQG\RXZLOOXQGHUVWDQGH[DFWO\ZKDW,PHDQ:HOO
WKHQ:,//WKHSK\VLFDOPDJQHWLVPWRIORZRXWLQWR\RXUSHUVRQDODWPRVSKHUH
MXVWDV\RXZLOOWKHKDQGWRULVHDQGWKHWKLQJKDSSHQV
%XW\RXPD\VD\\RXFDQVHHWKHKDQGPRYHDQGNQRZZKHWKHU\RXU
FRPPDQGKDVEHHQREH\HGZKLOH\RXFDQQRWVHHWKHSK\VLFDOPDJQHWLVPIORZ
&HUWDLQO\EXW\RXFDQIHHOWKHPDJQHWLVPIORZDQGWKXVEHFHUWDLQRILW
7KHIORZRISK\VLFDOPDJQHWLVPVRRQEHFRPHVSHUIHFWO\DSSDUHQWWRD
SHUVRQDQGKHLVDVFHUWDLQRIKLVUDGLDWLRQDVKHLVWKDWKHLVUDGLDWLQJKHDWRQD
ZDUPGD\,WLVRQHRIWKRVHWKLQJVZKLFKFDQQRWZHOOEHH[SODLQHGEXWZKLFKLV
UHDGLO\XQGHUVWRRGE\WKRVHZKRH[SHULHQFHLW
7U\LW\RXUVHOIDQG\RXZLOOVRRQEHFRPHFRQVFLRXVRIWKHIORZRIQHUYH
IRUFHIURP\RXLQWRWKHILHOGRI\RXUSHUVRQDODWPRVSKHUHRUDXUDWRDGLVWDQFH
RIVHYHUDOIHHWRQDOOVLGHVRI\RX<RXZLOOEHFRPHDZDUHRIWKHHIIHFWRI\RXU
SK\VLFDOPDJQHWLVPXSRQRWKHUVZKRFRPHLQFRQWDFWZLWK\RX<RXZLOOEHDEOH
WRSHUFHLYHWKHUHDFWLRQDQGUHVSRQVHWR\RXUVWURQJPDJQHWLFLQIOXHQFHRQWKHP
7KH\ZLOOXQFRQVFLRXVO\OHW\RXNQRZWKDWWKH\IHHOWKHSRZHURI\RXU
SUHVHQFHDQGDFNQRZOHGJH\RXUVWUHQJWK<RXZLOOILQGDSX]]OHGH[SUHVVLRQRQ
WKHSDUWRIVRPHRI\RXUROGDFTXDLQWDQFHVDQGDVVRFLDWHVZKRZLOOEHGLPO\
FRQVFLRXVWKDWWKHUHLVVRPHWKLQJGLIIHUHQWDERXW\RXZKLFKWKH\FDQQRWH[SODLQ
FRQVFLRXVWKDWWKHUHLVVRPHWKLQJGLIIHUHQWDERXW\RXZKLFKWKH\FDQQRWH[SODLQ
VDWLVIDFWRULO\WRWKHPVHOYHV'RQRWKRZHYHUPDNHWKHPLVWDNHRILQIRUPLQJ
WKHPIRUWKLVZLOOLQYLWHXQSOHDVDQWFRPPHQWDQGFULWLFLVPDQGZLOODOVRWHQGWR
PDNHSHUVRQVDVVXPHDGHIHQVLYHDWWLWXGHWRZDUG\RXȈDQGHYHQDQRIIHQVLYH
RQHSHUKDSVȈLQVHOISURWHFWLRQ
<RXZLOODOVREHFRPHDZDUHRIWKHKHDOLQJDQGVWUHQJWKHQLQJHIIHFWRI\RXU
PDJQHWLVPXSRQGHOLFDWHDQGVLFNSHUVRQVZKRFRPHLQFRQWDFWZLWK\RX6XFK
SHUVRQVZLOOIHHOVWUHQJWKHQHGE\\RXUSUHVHQFHDQGZLOOGLVOLNHOHDYLQJ\RX
<RXPD\H[SHULHQFHVRPHGLIILFXOW\LQSUHYHQWLQJWKHPIURPDWWDFKLQJ
WKHPVHOYHVWR\RXDQGVHHNLQJWROLYHRQ\RXUPDJQHWLVP%XWZKHQ\RXOHDUQ
WKHDUWRIXVLQJWKHPLQGIRUFHRUPHQWDOPDJQHWLVP\RXZLOOEHDEOHWRVKDNH
WKHPRIIZKHQQHFHVVDU\,QWKHPHDQWLPH\RXPD\GRPXFKJRRGE\JLYLQJ
WKHVHSHUVRQVPDJQHWLFWUHDWPHQWVHLWKHUE\FRQVFLRXVO\GLUHFWLQJDVWUHDPRI
PDJQHWLVPWRZDUGVWKHPȈE\WKHXVHRIWKHZLOOȈRUE\WKHXVHRIWKHKDQG
<RXUPDJQHWLVPZLOOIORZIUHHO\RXWRI\RXUKDQGVDQGZLOOLQYLJRUDWHZHDN
SHUVRQVWHQGWRUHPRYHSDLQIXOFRQGLWLRQVHWF$OLWWOHH[SHULHQFHZLOOPDNH
\RXDPDJQHWLFKHDOHULI\RXVKRXOGVRGHVLUH
,QWKLVPDWWHURIKDQGVKDNLQJ\RXZLOOQRWLFHVWUDQJHWKLQJV3HUVRQVZKR
WDNH\RXUKDQGZLOOEHLPSUHVVHGE\VRPHWKLQJVWUDQJHDQGSRZHUIXODERXW\RX
IRU\RXUPDJQHWLVPZLOOIORZRXWWRZDUGWKHPDQGWKURXJKWKHLUERG\
VRPHWLPHVLQDPRVWPDUNHGPDQQHUEXWPRUHRIWHQLQDQHDV\FXUUHQW
<RXPD\SURMHFW\RXUSK\VLFDOPDJQHWLVPLQDGLUHFWFXUUHQWTXLWHD
GLVWDQFHIURP\RXUERG\E\WKHVLPSOHHIIRUWRI\RXUZLOOZKHQRQFH\RXKDYH
OHDUQHGWKHOLWWOHSRLQWVRISUDFWLFHE\UHSHDWHGWULDOV
,VKDOOQRWVSHDNDWWKLVSODFHRIWKHXVHRIWKHSK\VLFDOPDJQHWLVPLQ
FRQQHFWLRQZLWKWKHPHQWDOFXUUHQWVIRUWKDWWRSLFZLOOEHWDNHQXSLQDODWHU
FKDSWHURUFKDSWHUVUDWKHU%XWGRQRWZDLWXQWLOWKDWWLPHWRSUDFWLFHȈJHWWR
ZRUNDQGSUDFWLFHZLWKWKHSK\VLFDOPDJQHWLVPQRZVRWKDW\RXZLOOKDYHLW
ZHOOLQKDQGZKHQ\RXUHFHLYHWKHKLJKHULQVWUXFWLRQUHJDUGLQJWKHPHQWDO
FXUUHQWV3ODQW\RXUIHHWILUPO\RQHDFKVWHSRIWKHODGGHUȈWKHQ\RXZLOOQRWVOLS
ZKHQFOLPELQJ'R\RXVHHWKHSRLQW"
&KDSWHU
0HQWDO5DGLDWLRQ
7DEOHRI&RQWHQW

/HDYLQJIRUWKHPRPHQWWKHSKDVHRISK\VLFDOPDJQHWLVPRUQHUYHIRUFHDQG
HQWHULQJLQWRDFRQVLGHUDWLRQRIWKHRWKHUSKDVHQDPHO\WKDWRIPHQWDO
PDJQHWLVPRUWKRXJKWIRUFHOHWXVILUVWWDNHDJHQHUDOJODQFHDWWKHUHSRUWRIWKH
PRVWDGYDQFHGVFLHQFHRIWKHGD\XSRQWKHVXEMHFWRIWKHSKHQRPHQDRIPHQWDO
UDGLDWLRQ
,WZLOOEHZHOOIRU\RXWRIHHOIXOO\FRQYLQFHGRIWKHUHDOLW\RIWKLV
SKHQRPHQRQEHIRUH\RXXQGHUWDNHWRPDQLIHVWWKHSRZHU7KLVQRWRQO\WR
PDLQWDLQFRQVLVWHQF\DQGPHQWDOKRQHVW\RQ\RXURZQSDUWEXWDOVRWKDW\RX
PD\ULG\RXUVHOIRIDQ\GRXEWRUXQEHOLHILQWKHPDWWHUWKHUHVXOWRIVXFKGRXEW
RUXQEHOLHIEHLQJWRLQWHUSRVHDEDUULHURUEUDNHXSRQWKHZLOODVZHKDYHVWDWHG
LQDSUHFHGLQJFKDSWHU
/LVWHQWRWKHIROORZLQJZRUGVIURPWKHSHQRIRQHRIHKZRUOG VJUHDW
VFLHQWLVWV3URIHVVRU2FKRURZLF]ZKRKDVFUHDWHGVXFKDZRQGHUIXOVWLUKHUHLQ
3DULVE\KLVGHPRQVWUDWLRQVRISUDFWLFDOSV\FKRORJ\PHQWDOSKRWRJUDSK\HWF
3URIHVVRU2FKRURZLF]VD\V(YHU\OLYLQJEHLQJLVDG\QDPLFIRFXV
$G\QDPLFIRFXVWHQGVHYHUWRSURSDJDWHWKHPRWLRQWKDWLVSURSHUWRLW
3URSDJDWHGPRWLRQEHFRPHVWUDQVIRUPHGDFFRUGLQJWRWKHPHGLXPLWWUDYHUVHV
0RWLRQWHQGVDOZD\VWRSURSDJDWHLWVHOI
7KHUHIRUHZKHQZHVHHZRUNRIDQ\NLQGȈPHFKDQLFDOHOHFWULFDOQHUYHRU
SV\FKLFȈGLVDSSHDUZLWKRXWYLVLEOHHIIHFWWKHQRIWZRWKLQJVRQHKDSSHQV
HLWKHUDWUDQVPLVVLRQRUDWUDQVIRUPDWLRQ:KHUHGRHVWKHILUVWHQGDQGZKHUH
GRHVWKHVHFRQGEHJLQ"
,QDQLGHQWLFDOPHGLXPWKHUHLVRQO\WUDQVPLVVLRQ,QDGLIIHUHQWPHGLXP
WKHUHLVWUDQVPLVVLRQ<RXVHQGDQHOHFWULFFXUUHQWWKURXJKDWKLFNZLUH<RX
KDYHWKHFXUUHQWEXW\RXGRQRWSHUFHLYHDQ\RWKHUIRUFH%XWFXWWKDWWKLFNZLUH
DQGFRQQHFWWKHHQGVE\PHDQVRIDILQHZLUHWKHILQHZLUHZLOOJURZKRWWKHUH
ZLOOEHDWUDQVIRUPDWLRQRIDSDUWRIWKHFXUUHQWLQWRKHDW
7DNHDSUHWW\VWURQJFXUUHQWDQGLQWHUSRVHDZLUHVWLOOPRUHUHVLVWDQWRUD
YHU\WKLQFDUERQURGDQGWKHFDUERQZLOOHPLWOLJKW
$SDUWRIWKHFXUUHQWWKHQLVWUDQVIRUPHGLQWRKHDWDQGOLJKW7KLVOLJKWDFWV
LQHYHU\GLUHFWLRQDURXQGDERXWILUVWYLVLEO\DVOLJKWWKHQLQYLVLEO\DVKHDWDQG
HOHFWULFFXUUHQW+ROGDPDJQHWQHDULW,IWKHPDJQHWLVZHDNDQGPRYDEOHLQ
HOHFWULFFXUUHQW+ROGDPDJQHWQHDULW,IWKHPDJQHWLVZHDNDQGPRYDEOHLQ
WKHIRUPRIDPDJQHWLFQHHGOHWKHEHDPRIOLJKWZLOOFDXVHLWWRGHYLDWHLILWLV
VWURQJDQGLPPRYDEOHLWZLOOLQWXUQFDXVHWKHEHDPRIOLJKWWRGHYLDWH
$QGDOOWKLVIURPDGLVWDQFHZLWKRXWFRQWDFWZLWKRXWVSHFLDOFRQGXFWRUV
$SURFHVVWKDWLVDWRQFHFKHPLFDOSK\VLFDODQGSV\FKLFDOJRHVRQLQD
EUDLQ$FRPSOH[DFWLRQRIWKLVNLQJLVSURSDJDWHGWKURXJKWKHJUD\PDWWHUDV
ZDYHVDUHSURSDJDWHGLQZDWHU5HJDUGHGRQLWVSK\VLRORJLFDOVLGHDQLGHDLV
RQO\DYLEUDWLRQDYLEUDWLRQWKDWLVSURSDJDWHG\HWZKLFKGRHVQRWSDVVRXWRID
PHGLXPLQZKLFKLWFDQH[LVWDVVXFK,WLVSURSDJDWHVDVIDUDVRWKHUYLEUDWLRQV
DOORZ,WLVSURSDJDWHGPRUHZLGHO\LILWDVVXPHVWKHFKDUDFWHUZKLFK
VXEMHFWLYHO\ZHFDOOHPRWLYH%XWLWFDQQRWJREH\RQGZLWKRXWEHLQJ
WUDQVIRUPHG
1HYHUWKHOHVVOLNHIRUFHLQJHQHUDOLWFDQQRWUHPDLQLQLVRODWLRQLWHVFDSHVLQ
GLVJXLVH
7KRXJKWVWD\VDWKRPHDVWKHFKHPLFDODFWLRQRIDEDWWHU\UHPDLQVLQWKH
EDWWHU\LWLVUHSUHVHQWHGE\LWVG\QDPLFFRUUHODWHFDOOHGLQWKHFDVHRIWKHEDWWHU\
DFXUUHQWDQGLQWKHFDVHRIWKHEUDLQ,NQRZQRWZKDWEXWZKDWHYHULWVQDPH
PD\EHLWLVWKHG\QDPLFFRUUHODWHRIWKRXJKW,KDYHFKRVHQWKHWHUP G\QDPLF
FRUUHODWH 7KHUHLVVRPHWKLQJPRUHWKDQWKDWWKHXQLYHUVHLVQHLWKHUGHDGQRU
YRLG
$IRUFHWKDWLVWUDQVPLWWHGPHHWVRWKHUIRUFHVDQGLILWLVWUDQVIRUPHGRQO\
OLWWOHE\OLWWOHLWXVXDOO\OLPLWVLWVHOIWRPRGLI\LQJDQRWKHUIRUFHDWLWVRZQFRVW
WKRXJKZLWKRXWVXIIHULQJSHUFHSWLEO\WKHUHE\7KLVLVWKHFDVHSDUWLFXODUO\ZLWK
IRUFHVWKDWDUHSHUVLVWHQWFRQFHQWUDWHGZHOOVHFRQGHGE\WKHLUPHGLXP,WLVWKH
FDVHZLWKWKHSK\VLRORJLFDOHTXLOLEULXPQHUYHIRUFHSV\FKLFIRUFHLGHDV
HPRWLRQVDQGWHQGHQFLHV7KHVHPRGLI\HQYLURQLQJIRUFHVZLWKRXWWKHPVHOYHV
GLVDSSHDULQJ7KH\DUHLPSHUFHSWLEO\WUDQVIRUPHGDQGLIWKHQH[WPDQLVRID
QDWXUHH[FHSWLRQDOO\ZHOODGDSWHGWRWKHPWKH\JDLQLQLQGXFWLYHDFWLRQ
9DULRXVRWKHUHPLQHQWVFLHQWLVWVKDYHWHVWLILHGWRWKHJHQHUDOUHVHPEODQFHRI
WKHEUDLQWRDQHOHFWULFDORUPDJQHWLFEDWWHU\RUFHOOJURXS3URIHVVRU%DLQKDV
VDLG7KHVWUXFWXUHRIWKHQHUYRXVVXEVWDQFHVDQGWKHH[SHULPHQWVPDGHXSRQ
WKHQHUYHVDQGQHUYHFHQWHUVHVWDEOLVKEH\RQGGRXEWFHUWDLQSHFXOLDULWLHVDV
EHORQJLQJWRWKHIRUFHWKDWLVH[HUFLVHGE\WKHEUDLQ7KLVIRUFHLVRIDFXUUHQW
QDWXUHWKDWLVWRVD\DSRZHUJHQHUDWHGDWRQHSDUWRIWKHVWUXFWXUHLVFRQYH\HG
DORQJDQLQWHUYHQLQJVXEVWDQFHDQGGLVFKDUJHGDWVRPHRWKHUSDUW7KHGLIIHUHQW
IRUPVRIHOHFWULFLW\DQGPDJQHWLVPKDYHPDGHXVIDPLOLDUZLWKWKLVNLQGRI
DFWLRQ
3URIHVVRU'UDSHUWHOOVXVWKDW,ILQGWKHFHUHEUXPLVDEVROXWHO\DQDORJRXVLQ
FRQVWUXFWLRQWRDQ\RWKHUQHUYRXVDUF,WLVFRPSRVHGRIFHQWULSHWDODQG
FHQWULIXJDOILEHUVKDYLQJDOVRUHJLVWHULQJJDQJOLD,ILQRWKHUQHUYRXVDUFVWKH
VWUXFWXUHLVPHUHO\DXWRPDWLFDQGFDQGLVSOD\QRSKHQRPHQDRILWVHOIEXW
VWUXFWXUHLVPHUHO\DXWRPDWLFDQGFDQGLVSOD\QRSKHQRPHQDRILWVHOIEXW
UHTXLUHVWKHLQIOXHQFHRIDQH[WHUQDODJHQWȈWKHRSWLFDODSSDUDWXVLQHUWVDYH
XQGHUWKHLQIOXHQFHRIOLJKWWKHDXGLWRU\VDYHXQGHUWKHLPSUHVVLRQRIVRXQGȈ
WKHFHUHEUXPEHLQJSUHFLVHO\DQDORJRXVLQLWVHOHPHQWDU\VWUXFWXUHSUHVXSSRVHV
WKHH[LVWHQFHRIVRPHDJHQWWRDFWWKURXJKLW
'UKDGGRFNVD\VLQFRQQHFWLRQZLWKKLVFRQVLGHUDWLRQRIWKHLGHDWKDW
WKRXJKWPD\EHFRPPXQLFDWHGWKRXJKHWKHUȈYLEUDWLRQV7KHHWKHULVDFFHSWHG
E\VFLHQFHDVDUHDOLW\DQGDVDPHGLXPIRUOLJKWKHDWHOHFWULFLW\PDJQHWLVP
HWF7KHQHUYRXVV\VWHPLVFHUWDLQO\FRPSDUDEOHWRDQHOHFWULFEDWWHU\ZLWK
FRQQHFWLQJZLUHV&RPPXQLFDWLRQRIWKRXJKWDQGIHHOLQJZLWKRXWWKHPHGLDWLRQ
RIVHQVHSHUFHSWLRQDVFRPPRQO\XQGHUVWRRGLVQRZHVWDEOLVKHG
,QDQLPDWHREMHFWVH[HUWQRZDQGWKHQ VWUDQJHLQIOXHQFHV 3HRSOHFHUWDLQO\
FDUU\ZLWKWKHPDSHUVRQDODWPRVSKHUH7KHUHSUHVHQWDWLRQRIWKHFRQGLWLRQRI
WKHVHIDFWVE\DSV\FKLFILHOGFRPSDUHGWRWKHPDJQHWLFRUHOHFWULFILHOG
EHFRPHVWKHUHIRUHLIQRWSODXVLEOHDWOHDVWFRQYHQLHQW$VVXFKD ILHOG H[LVWV
VXUURXQGLQJWKHVXQVRPD\D ILHOG EHDVVXPHGDVVXUURXQGLQJHDFKKXPDQ
LQGLYLGXDO :HKDYHDOUHDG\VWURQJJURXQGVIRUEHOLHYLQJWKDWZHOLYHLQD
PHGLXPZKLFKFRQYH\VWRDQGIURPRYHPHQWVWRXVIURPWKHVXQDQGWKDWWKHVH
PRYHPHQWVDUHHOHFWURPDJQHWLFDQGWKDWDOOWKHWUDQVIRUPDWLRQRIOLJKWDQGKHDW
DQGLQGHHGWKHSKHQRPHQDRIOLIHDUHGXHWRWKHHOHFWULFDOHQHUJ\ZKLFKFRPHV
WRXVDFURVVWKHYDFXXPZKLFKH[LVWVEHWZHHQXVDQGWKHVXQȈDYDFXXPZKLFK
LVSHUYDGHGE\WKHHWKHUZKLFKLVDILWPHGLXPIRUWKHWUDQVPLVVLRQRI
HOHFWURPDJQHWLFZDUHV %\PHDQVWKHQRIDVLPLODUWKHRU\DSSOLHGWRPLQGDQG
EUDLQDQGERG\ZHPD\ILQGUHDVRQDEOHH[SODQDWLRQVRIPDQ\RWKHUZLVH
LQVROXEOHP\VWHULHVRIOLIHDQGZKLFKLVRIPRUHLPSRUWDQFHGHGXFHFHUWDLQ
VXJJHVWLRQVIRUWKHSUDFWLFDOUHJXODWLRQRIOLIHLQWKHJUHDWHVWLQGLYLGXDOLQWHUHVW
+DGGRFNDOVRDSSURYLQJO\TXRWHVWKHIROORZLQJIURP'U03+DWILHOGDQ
DXWKRULW\ZLWKZKRP,SHUVRQDOO\DPQRWIDPLOLDU7KHDUUDQJHPHQWRIWKH
QHUYHHQYHORSHVLVVROLNHWKDWRIWKHEHVWFRQVWUXFWHGHOHFWULFDOFDEOHVWKDWZH
FDQQRWKHOSWKLQNLQJWKDWERWKZHUHFRQVWUXFWHGWRFRQGXFWVRPHWKLQJYHU\PXFK
DOLNH,NQRZWKDWWKHUHDUHWKRVHZKRVWRXWO\PDLQWDLQWKDWQHUYHIRUFHLVQRW
HOHFWULFLW\DQGLWLVQRWLQWKHVHQVHWKDWDQHOHFWULFDOEDWWHU\LVWKHVDPHWKLQJV
DVDOLYHPDQEXWQHYHUWKHOHVVQHUYHIRUFHLVFORVHO\DOOLHGWRWKDWZRQGHUIXO
WKLQJWKDWIRUWKHZDQWRIDEHWWHUDQGFOHDUHUXQGHUVWDQGLQJZHDJUHHWRFDOO
HOHFWULFLW\
+DGGRFNDGGV$OOVWDWHVRIERG\DQGPLQGLQYROYHFRQVWDQWPROHFXODUDQG
FKHPLFDOFKDQJH7KHVXJJHVWLRQDULVHVWKDWWKHEUDLQZLWKLWVPLOOLRQVRIFHOOV
DQGLWVLQFRQFHLYDEOHFKDQJHVLQVXEVWDQFHPD\EHUHJDUGHGDVDWUDQVPLWWLQJ
DQGUHFHLYLQJEDWWHU\7KHEUDLQEHLQJDNLQGRIEDWWHU\DQGWKHQHUYHV
FRQGXFWRUVRIUHOHDVHGVWRUHGHQHUJ\WRGLIIHUHQWSDUWVRIWKHERG\E\DNLQGRI
FRQGXFWRUVRIUHOHDVHGVWRUHGHQHUJ\WRGLIIHUHQWSDUWVRIWKHERG\E\DNLQGRI
DFWLRQVLPLODUWRWKHDFWLRQVRIHOHFWULFLW\DQGPDJQHWLVPLWLVVXJJHVWHGWKDW
HLWKHUE\PHDQVRIWKHHWKHURURIVRPHVWLOOILQHUIRUPRIPDWWHUGLVFKDUJHVRI
EUDLQHQHUJ\PD\EHFRQGXFWHGEH\RQGWKHOLPLWVRIWKHERG\,IWKHQHUYHWUDFN
FRUUHVSRQGVWRZLUHVWKLVUHILQHGPHGLXPPD\FRUUHVSRQGWRWKHHWKHUILHOG
VXSSRVHGWREHHPSOR\HGLQZLUHOHVVWHOHJUDSK\$VHOHFWULFDOPRYHPHQWVDUH
FRQGXFWHGZLWKRXWZLUHVRURWKHUYLVLEOHPHGLDVRPD\EUDLQGLVFKDUJHVEH
FRQYH\HGEH\RQGWKHPHFKDQLVPRIWKHEDWWHU\ZLWKRXWWKHLQWHUYHQWLRQRI
QHUYHVȈH[FHSWDVWKH\PD\FRQVWLWXWHDSDUWRIWKHEDWWHU\*HQHUDOO\VSHDNLQJ
VXFKGLVFKDUJHVZRXOGRULJLQDWHLQWZRZD\VE\GLUHFWPHQWDODFWLRQRUE\
PHQWDORUSK\VLFDOVWDWHVȈSHUKDSVE\DFRPELQDWLRQ
,QWKHDERYHTXRWDWLRQVWKHUHZLOOEHIRXQGFRQVWDQWUHIHUHQFHWRYLEUDWLRQV
LQWKHXQLYHUVDOHWKHU7KDWWKHUHLVDSODFHDQGSOHQW\RIURRPLQWKHVFDOHRI
HWKHULFYLEUDWLRQVIRUWKHYLEUDWLRQVRIPHQWDOIRUFHPD\EHVHHQE\DUHIHUHQFH
WRWKHIROORZLQJTXRWDWLRQVIURPHPLQHQWDXWKRULWLHV
3URIHVVRU*UD\KDVVDLG7KHUHLVPXFKIRRGIRUVSHFXODWLRQLQWKHWKRXJKW
WKDWWKHUHH[LVWVVRXQGZDYHVWKDWQRKXPDQHDUFDQKHDUDQGFRORUZDYHVRI
OLJKWWKDWQRH\HFDQVHH7KHORQJGDUNVRXQGOHVVVSDFHEHWZHHQDQG
YLEUDWLRQVSHUVHFRQGDQGWKHLQILQLW\RIUDQJHEH\RQG
YLEUDWLRQVSHUVHFRQGZKHUHOLJKWFHDVHVLQWKHXQLYHUVH
RIPRWLRQPDNHVLWSRVVLEOHWRLQGXOJHLQVSHFXODWLRQ
3URIHVVRU:LOOLDPVKDVVDLG7KHUHLVQRJUDGDWLRQEHWZHHQWKHPRVWUDSLG
XQGXODWLRQVRUWUHPEOLQJWKDWSURGXFHRXUVHQVDWLRQRIVRXQGDQGWKHVORZHVWRI
WKRVHZKLFKJLYHULVHWRRXUVHQVDWLRQVRIJHQWOHVWZDUPWK7KHUHLVDKXJHJDS
EHWZHHQWKHPZLGHHQRXJKWRLQFOXGHDQRWKHUZRUOGRIPRWLRQDOOO\LQJ
EHWZHHQRXUZRUOGRIVRXQGDQGRXUZRUGRIKHDWDQGOLJKW$QGWKHUHLVQRJRRG
UHDVRQZKDWHYHUIRUVXSSRVLQJWKDWPDWWHULVLQFDSDEOHRIVXFKLQWHUPHGLDWH
DFWLYLW\RUWKDWVXFKDFWLYLW\PD\QRWJLYHULVHWRLQWHUPHGLDWHVHQVDWLRQV
SURYLGHGWKHUHDUHRUJDQVIURWDNLQJXSDQGVHQVLI\LQJWKHVHPRYHPHQWV
$UHFHQWZULWHULQWKH/RQGRQ3RVWVD\V7KHNQRZOHGJHZHJDLQE\
H[SHULPHQWEULQJVKRPHWRXVZKDWDPLVHUDEO\LPSHUIHFWSLHFHRIPHFKDQLVP
RXUERGLHVDUH7KHHDUFDQGHWHFWWKHVORZIRRWHGVRXQGYLEUDWLRQVWKDWFRPHWR
XVDWWKHUDWHRIEHWZHHQDQGDVHFRQG%XWWKHZKROHRIVSDFHPD\EH
TXLYHULQJDQGSDOSLWDWLQJZLWKZDYHVDWDOOVRUWVRIYDU\LQJVSHHGVDQGRXU
VHQVHVZLOOWHOOXVQRWKLQJRIWKHPXQWLOZHJHWWKHPFRPLQJWRXVDWWKH
LQFRQFHLYDEOHVSHHGRIDVHFRQGZKHQDJDLQZHUHVSRQGWR
WKHPDQGDSSUHFLDWHWKHPLQWKHIRUPRIOLJKW
$QRWKHUZULWHUDQ$PHULFDQSV\FKRORJLVWFDUULHVRQWKHWDOHIURPWKLVSRLQW
DVIROORZV7KHILUVWLQGLFDWLRQVRIZDUPWKFRPHVZKHQWKHYLEUDWLRQVUHDFKWKH
UDWHRISHUVHFRQG:KHQWKHYLEUDWLRQVUHDFK
UDWHRISHUVHFRQG:KHQWKHYLEUDWLRQVUHDFK
WKHORZHVWYLVLEOHOLJKWUD\PDQLIHVWV7KHQFRPHVWKH
RUDQJHUD\VWKHJROGHQ\HOORZWKHSXUH\HOORZWKHJUHHQLVK\HOORZWKHSXUH
JUHHQWKHJUHHQLVKEOXHWKHRFHDQEOXHWKHF\DQLFEOXHWKHLQGLJRDQGILQDOO\
WKHYLROHWWKHKLJKHVWGHJUHHRIOLJKWZKLFKWKHKXPDQH\HFDQUHJLVWHUDQG
ZKLFKRFFXUVZKHQWKHYLEUDWLRQVUHDFKWKHUDWHRISHU
VHFRQG7KHQFRPHWKHXOWUDYLROHWUD\VLQYLVLEOHWRKXPDQVLJKWEXWUHJLVWHUHG
E\FKHPLFDOPHGLD,QWKLVXOWUDYLROHWUHJLRQOLHWKH ;5D\V DQGWKHRWKHU
UHFHQWO\GLVFRYHUHGKLJKGHJUHHUD\VDOVRWKHDFWLQLFUD\VZKLFKZKLOHLQYLVLEOH
WRWKHH\HUHJLVWHURQWKHSKRWRJUDSKLFSODWHVXQEXUQRQH VIDFHEOLVWHURQH V
QRVHDQGHYHQFDXVHYLROHQWH[SORVLRQVLQFKHPLFDOVXEVWDQFHVH[SRVHGWRWKHP
DVZHOODVDFWLQJRQWKHJUHHQOHDYHVRISODQWVFDXVLQJWKHFKHPLFDOFKDQJHRI
WUDQVIRUPLQJFDUERQLFDFLGDQGZDWHULQWRVXJDUDQGVWDUFKHV7KHVHIRUPVRI
GDUNOLJKW WKDWLVOLJKWWRRILQHWREHSHUFHLYHGE\WKHKXPDQH\HDUHEXWIDLQW
LQGLFDWLRQVRIWKHH[LVWHQFHRIVWLOOKLJKHUDQGILQHUYLEUDWLRQVȈWKH ILQHUIRUFHV
RIQDWXUH 
2K\HV7KHUHLVSOHQW\RIVSDFHDQGURRPLQ1DWXUH VVFDOHRIIRUFHVIRUWKH
YLEUDWLRQVRIPHQWDOHQHUJ\QHUYHIRUFHDQGSHUVRQDOPDJQHWLVPZKLFK
FRPELQHVWKHWZR,WUXVWWKDWWKHIRUHJRLQJVWDWHPHQWVRIVFLHQWLILFIDFWKDYH
FOHDUHG\RXUPLQGRIDQ\OXUNLQJGRXEWVRQWKHVXEMHFW
&KDSWHU
0HQWDO$WWLWXGHV
7DEOHRI&RQWHQW

,QDSUHFHGLQJFKDSWHU,KDYHVWDWHGWKDWWKHPHQWDOSKDVHRISHUVRQDO
PDJQHWLVPFRQVLVWVRIWZRFRRUGLQDWHGPDQLIHVWDWLRQVRIPHQWDOSRZHUWKHILUVW
RIZKLFKZDVWKHKROGLQJRIFHUWDLQPHQWDOVWDWHVXQWLOWKHPHQWDODWPRVSKHUH
EHFRPHVFKDUJHGZLWKWKHYLEUDWLRQVRIWKHSDUWLFXODUPHQWDOVWDWHV/HWXVQRZ
FRQVLGHUZKDWDUHWKHVHFHUWDLQPHQWDOVWDWHVZKLFKDUHWREHKHOG
,QWKHILUVWSODFHWKHVHPHQWDOVWDWHVDUHQRWVRPXFKDQ\VHWRISDUWLFXODU
WKRXJKWVEXWUDWKHUDUHVWDWHGPHQWDODWWLWXGHVLQUHODWLRQWRRQHVHOIDQGWKHRXWHU
ZRUOGRIPHQ$PDQ VPHQWDODWWLWXGHLIILUPO\GHILQHGDQGDVILUPO\KHOG
LPSUHVVHVLWVHOIXSRQHYHU\WKLQJDURXQGWKHPDQ+LVORRNVJURZWRFRQIRUPKLV
YRLFHKLVZDONKLVJHQHUDODSSHDUDQFHDOOJURZWRUHIOHFWKLVLQQHUVWDWHVRI
PLQG0RUHRYHUKLVPHQWDODWPRVSKHUHEHFRPHVVRFKDUJHGZLWKFHUWDLQ
YLEUDWLRQVWKDWWKRVHZKRFRPHLQFRQWDFWZLWKWKHPDQDFWXDOO\IHHOKLVPHQWDO
DWWLWXGHDQGDGMXVWWKHPVHOYHVWRLW
:KRRIXVFDQQRWUHFDOOWKHVRPHHNDQGKXPEOH8ULDK+HHSPHQWDO
DWWLWXGHPDQLIHVWHGE\VRPHSHUVRQVRIRXUDFTXDLQWDQFH":KRGRHVQRW
UHPHPEHUKDYLQJDFWXDOO\IHOWWKHVQHDN\IR[\PHQWDODWWLWXGHRIFHUWDLQRWKHU
SHUVRQV"$QGZKRFDQIRUJHWWKHEROGPDVWHUIXOPHQWDODWWLWXGHRIFHUWDLQ
VXFFHVVIXOPHQLQRXUILHOGRIEXVLQHVVDFTXDLQWDQFH"(DFKRIWKHVHFODVVHVLV
SRVVHVVHGRIDPHQWDODWPRVSKHUHZKLFKUHYHDOVLWVHOIDWRQFHWRXVZKHQZH
PHHWWKHP
,QHHGVFDUFHO\XUJHXSRQ\RXWKHLPSRUWDQFHRISURGXFLQJLQ\RXUVHOIWKH
PRVWGHVLUDEOHNLQGRISHUVRQDODWPRVSKHUH$QGDV,KDYHVDLGWKHPHQWDO
DWPRVSKHUHLVWKHGLUHFWUHVXOWRIWKHPHQWDODWWLWXGHRIWKHSHUVRQDQGUHIOHFWV
WKHVDPHLQHYLWDEO\2IFRXUVHWKHPHQWDODWWLWXGHRIDSHUVRQLVFRPSRVHGRID
YDULHW\RIEHOLHIVRSLQLRQVYLHZVLGHDOVHWFDQGPXVWRIQHFHVVLW\EHRID
VRPHZKDWPL[HGFKDUDFWHU,QWKHFDVHRIWKHPDMRULW\RISHUVRQVWKHSHUVRQDO
DWPRVSKHUHODFNVIRUFHDQGFKDUDFWHUEHFDXVHRIDODFNRIDQ\SDUWLFXODUPHQWDO
FRORU%XWLQWKHFDVHRIWKHVWURQJLQGLYLGXDOVRIWKHUDFHLWZLOOEHIRXQGWKDW
WKHUHLVDOZD\VDVWURQJIL[HGPHQWDODWWLWXGHȈDVWURQJGHVLUHZKLFKFRORUVDOO
WKHWKRXJKWDSRZHUIXODPELWLRQZKLFKJLYHVWRQHWRDOOWKHUHVWRUDILUP
UHVROYHZKLFKILUHVWKHHQWLUHPHQWDOFKDUDFWHU7KLVVWURQJYLEUDWLRQLVFDUULHG
RXWLQWRWKHSHUVRQDODWPRVSKHUHDQGLWVLQIOXHQFHLVIHOWDQGPHQUHDFWWKHUHWR
RXWLQWRWKHSHUVRQDODWPRVSKHUHDQGLWVLQIOXHQFHLVIHOWDQGPHQUHDFWWKHUHWR
,QDJHQHUDOZD\PHQWDODWWLWXGHVPD\EHGLYLGHGLQWRWZRFODVVHVYL] 
SRVLWLYHDQG  QHJDWLYH
,WLVGLIILFXOWDWILUVWWRJLYHWKHNH\QRWHRIHDFKRIWKHVHWZRFODVVHVRI
PHQWDODWWLWXGHEXW,FDOO\RXUDWWHQWLRQWRWKHZRUGVRIDQ$PHULFDQZULWHULQ
WKLVFRQQHFWLRQZKRZHOOVD\V7KDWZKLFKWHQGVWRUHQGHURQHVWURQJLV
SRVLWLYHWKDWZKLFKWHQGVWRUHQGHUKLPZHDNLVQHJDWLYH,GRQRWWKLQNWKDW,
FDQLPSURYHRQWKLVGHILQLWLRQDQG,DGYLVH\RXWRDGRSWLWDQGWRPHDVXUH\RXU
PHQWDODWWLWXGHVE\WKDWVWDQGDUG
%\DOOPHDQVFXOWLYDWHDQGGHYHORSWKHSRVLWLYHVDQGUHVWULFWWKHQHJDWLYHV
LQ\RXUPHQWDOPDNHXSVRWKDWLQWKHHQG\RXUPHQWDODWWLWXGHPD\EH
SRVLWLYHLQVWHDGRIQHJDWLYHȈVWURQJLQVWHDGRIZHDN
$QLQWHUHVWLQJWKLQJDERXWWKHFXOWLYDWLRQRIDPHQWDODWWLWXGHLVWKDWQRWRQO\
GRHVWKHLPSURYHGPHQWDODWWLWXGHWHQGWRLPSUHVVLWVHOIXSRQRWKHUVZLWKZKRP
\RXFRPHLQFRQWDFWEXWWKDWLWDOVRWHQGVWRLPSUHVVLWVHOIXSRQ\RXURZQ
PHQWDOLW\VRWKDW\RXJUDGXDOO\EHFRPHPRUHDQGPRUHIL[HGLQWKHPHQWDO
DWWLWXGH
0HQWDODWWLWXGHUHVHPEOHV\HDVWLQWKHVHQVHWKDWLI\RXLQVHUWDVLQJOHELWRI
WKHIHUPHQWLQ\RXUPLQGLWZLOOEHJLQWRZRUNDQGJURZRWKHUFHOOVXQWLOLW
ILQDOO\ILOOV\RXUHQWLUHPLQG,WWHQGVWRUHSURGXFHLWVHOI7KLVLVWUXHRIERWK
GHVLUDEOHDQGXQGHVLUDEOHPHQWDOLGHDVEXWȈDQGUHPHPEHUWKLVZHOOȈKHUHLVD
PRVWKRSHIXODQGHQFRXUDJLQJIDFWDSRVLWLYHLGHDZLOOWHQGWRNLOODQHJDWLYH
RQHVR\RXVHH1DWXUHLVILJKWLQJRQ\RXUVLGH7KHEHVWZD\WRNLOODQGGHVWUR\
QHJDWLYHPHQWDOLGHDVDQGDWWLWXGHVLVWRSODQWDJRRGFURSRISRVLWLYHLQWKHLU
SODFHVDQGWKHQHQFRXUDJHWKHILJKWȈWKHQHJDWLYHVZLOOJRXQGHUVXUHO\,WLV
OLNHSRXULQJIUHVKZDWHULQWRDEDVLQRIGLUW\ZDWHUȈLQWLPHWKHZDWHUZLOO
EHFRPHFOHDURUDJDLQOLNHIORRGLQJDURRPZLWKVXQVKLQHȈWKHGDUNQHVVZLOO
EHGHVWUR\HG
/HWXVWDNHDOLWWOHJODQFHDWWKHSULQFLSDOSRVLWLYHVDQGQHJDWLYHVLQWKHOLVWRI
PHQWDODWWLWXGHV
3RVLWLYHVFRXUDJHPDVWHUIXOQHVVDFWLYLW\LQLWLDWLYHG\QDPLFWKRXJKW
VHOIHVWHHPDVVHUWLYHQHVVFRQWLQXLW\
1HJDWLYHVIHDUVODYLVKQHVVVOXJJLVKQHVVZDLWLQJIRURUGHUVVWDWLFWKRXJKW
VHOIGLVWUXVWUHWUHDWLYHQHVVILFNOHQHVV
7KLVOLVWPLJKWEHH[WHQGHGPXFKIXUWKHUEXW,WKLQNWKDW\RXZLOOKDYH
FDXJKWWKHLGHDE\WKLVWLPH5XQRYHUWKHOLVWRIWKHVWURQJSRVLWLYHTXDOLWLHVRI
WKHVWURQJPHQRI\RXUDFTXDLQWDQFHDQGHQGHDYRUWRUHSURGXFHWKHPLQ\RX
5XQRYHUWKHOLVWRIZHDNQHJDWLYHTXDOLWLHVRIWKHZHDNSHUVRQV\RXNQRZȈDQG
HQGHDYRUWRFXWWKHPRXWRI\RXUPHQWDODWWLWXGHV
,QWKLVZRUNRIEXLOGLQJXSRIPHQWDODWWLWXGHUHPHPEHUWKLV7KLVPLQG
JURZVWRUHVHPEOHWKDWXSRQZKLFKLWIHHGVDQGWKHUHIRUH\RXVKRXOGIHHG
JURZVWRUHVHPEOHWKDWXSRQZKLFKLWIHHGVDQGWKHUHIRUH\RXVKRXOGIHHG
\RXUPLQGZLWKWKHYHU\NLQGRILGHDVZKLFK\RXZRXOGOLNHWRKDYH\RXUPHQWDO
DWWLWXGHUHIOHFW)RULQVWDQFHLI\RXGHVLUHDPHQWDODWWLWXGHRI&RXUDJH
'HWHUPLQDWLRQ0DVWHUIXOQHVV6XFFHVVHWF\RXVKRXOGUHDGVWRULHVLQZKLFK
WKHVHSRLQWVRIFKDUDFWHUDUHEURXJKWRXW\RXVKRXOGIUHTXHQWWKHFRPSDQ\RI
WKLVNLQGRISHUVRQV\RXVKRXOGFRQVWDQWO\KROGLQ\RXUPLQGWKH,'($/RIWKH
WKLQJV\RXZLVKWRGHYHORSLQ\RXUPHQWDODWWLWXGHDQG\RXZLOOILQGWKDW\RX
ZLOOQDWXUDOO\ILQGLQWKHRXWHUZRUOGWKHPDWHULDOWKLQJVFRUUHVSRQGLQJWRWKHP
$QGUHPHPEHUWKLVDYRLGWKHRSSRVLWHDQGQHJDWLYHERRNVSHUVRQVDQG
WKRXJKWVDV\RXZRXOGSRLVRQRXVVQDNHV
,WLVDVWRQLVKLQJKRZTXLFNO\WKHPLQGZLOOUHVSRQGWRWKHVWHDGIDVWKROGLQJ
RIWKH326,7,9(,'($/DQGWKHVWLPXODWLQJHQYLURQPHQWRI326,7,9(WKLQJV
,QDVKRUWWLPHWKHUHZLOOEHVHWXSDQLQVWLQFWLYHKDELWRIPLQGZKLFKZLOOVHOHFW
WKHSRVLWLYHWKLQJVIURPLWVHQYLURQPHQWDQGZLOODOVRUHMHFWWKHQHJDWLYHWKLQJV
7UDLQ\RXUPLQGWRVHOHFWWKHULJKWNLQGRIIRRGIRULWVHOIDQGLWZLOOVRRQDFTXLUH
WKHKDELWDQGSHUIRUPWKHZRUNLQVWLQFWLYHO\ZLWKRXWDQ\VSHFLDOVXSHUYLVLRQRQ
\RXUSDUW0RUHRYHUWKHUHZLOOEHGHYHORSHGLQ\RXUPLQGWKDWZKLFKWKDWJLIWHG
$PHULFDQZULWHU3UHQWLFH0XOIRUGRQFHFDOOHG7KH$WWUDFWLYH3RZHURI
7KRXJKWE\PHDQVRIZKLFK\RXZLOOGUDZWR\RXUVHOIWKHWKLQJVSHUVRQV
ERRNVHWFZKLFKZLOOVXSSO\\RXZLWKWKHSDUWLFXODUNLQGRIPHQWDOIRRGEHVW
ILWWHGWRWKH,'($/\RXDUHFDUU\LQJLQ\RXUPLQG,VKDOOQRWGLVFXVVWKLVODVW
ZRQGHUIXOSKHQRPHQRQEXWDVN\RXWRUHPHPEHUDQGDSSO\WKHIDFW
QHYHUWKHOHVVIRULWLVRQHRIWKHJUHDWIRUFHVRIQDWXUH
)LQDOO\,DGYLVH\RXWRVLWGRZQDQGPDNHDFDUHIXOIXOODQGKRQHVWFKDUWRI
\RXUPHQWDOFKDUDFWHULVWLFVSRVLWLYHDQGQHJDWLYH7KHQSODFHDSOXVVLJQEHIRUH
WKHSRVLWLYHVDQGPLQXVVLJQEHIRUHWKHQHJDWLYH7KHQHYHU\GD\UXQRYHU\RXU
SOXVOLVWDQGIL[LQ\RXUPLQGWKHLGHDWKDWWKHVHSRVLWLYHV0867EHGHYHORSHG
DQGWKHQHJDWLYHV0867EHUHVWDUWHG7KHGHYHORSPHQWRIWKHSRVLWLYHVZLOO
FRPHDERXWE\WKHKROGLQJLQPLQGRIWKHLGHDORIWKHPȈWKXVWKH\ZLOOGHYHORS
DQGLQFUHDVHOLNHDVHOIPXOWLSO\LQJFHOO7KHQHJDWLYHVPD\EHUHVWULFWHGE\
GHYHORSLQJWKHLURSSRVLWHVȈIRUWKLVLVWKHDSSOLFDWLRQRIWKHODZWKDWSRVLWLYHV
NLOORXWQHJDWLYHV8SRQWKHVHWZRJUHDWIXQGDPHQWDOODZVRISUDFWLFDO
SV\FKRORJ\RQHPD\EXLOGDFKDUDFWHUDWZLOO,ZLOOUHSHDWWKHPRQFHPRUHVR
WKDW\RXZLOOIL[WKHPLQ\RXUPLQG
,)HHG\RXUSRVLWLYHTXDOLWLHVE\LGHDVRIWKHVDPHNLQGLQWKRXJKWVERRNV
SHUVRQVHQYLURQPHQWHWF
,,5HVWULFWRUNLOORXW\RXUQHJDWLYHVE\GHYHORSLQJWKHLUSRVLWLYHRSSRVLWHV
$QGQRZIRUDZRQGHUIXOSODQRIGHYHORSLQJDSRVLWLYHPHQWDODWWLWXGH
7KLVSODQKDVEHHQVXFFHVVIXOO\SUDFWLFHGP\PDQ\RIP\VWXGHQWVVRPHRI
ZKRPVWDQGKLJKLQWKHOLVWRIWKHZRUOG VJUHDWPHQ
ZKRPVWDQGKLJKLQWKHOLVWRIWKHZRUOG VJUHDWPHQ
,WLVWKLV
%XLOGXSIRU\RXURZQXVHDQ,'($/3$77(51RIWKDWZKLFK\RXZLVKWR
EH0DSRXWH[DFWO\WKHFKDUDFWHULVWLFVZKLFK\RXZLVKWREH\RXUV7KHQ
SLFWXUHLQ\RXUPLQG VH\HDQLQGLYLGXDOSRVVHVVHGRIMXVWWKHVHTXDOLWLHVȈD
FRPSOHWHPRGHORUSDWWHUQRIWKDWZKLFK\RXZLVKWREH7KHQKROGWKDWSDWWHUQ
RUPRGHOFRQVWDQWO\LQ\RXULPDJLQDWLRQ6HHLWHYHUWKLQNDOZD\VDERXWLWYLHZ
LWIURPWKHLQVLGHDQGWKHRXWVLGHJHWIXOO\DFTXDLQWHGZLWKLW$QGJUDGXDOO\
\RXZLOOEHJLQWRJURZOLNH\RXULGHDO7KH,'($/ZLOOEHJLQWRPDWHULDOL]HLQ
\RXURZQFKDUDFWHUDQG\RXUPHQWDODWWLWXGHZLOOEHWKDWRI\RXUPRGHO
'RQRWSDVVE\WKLVUXOHEHFDXVHRILWVVLPSOLFLW\,WKDVZRUNHGPLUDFOHVIRU
RWKHUVȈZK\QRWIRU\RX",I\RXZLOOSHUVLVWZLWKWKLVSODQ\RXUPHQWDODWWLWXGH
ZLOOEHFRPHSRVLWLYHDQGIL[HGDQG\RXUSHUVRQDODWPRVSKHUHZLOOEHFKDUJHG
ZLWKWKHVWURQJSRVLWLYHYLEUDWLRQVZKLFKZLOOSURFODLP\RXDVDPDVWHU
/HWWKLVLGHDEH\RXUVLQVWXG\LQJWKHIROORZLQJFKDSWHUVDQGUHPHPEHUWKDW
LQWKLVZD\\RXFDQJHWWKHEHVWUHVXOWVIURPWKHVSHFLDOLQVWUXFWLRQZKLFKLVWR
IROORZWKLVFKDSWHU
&KDSWHU
7KH0HQWDO$WPRVSKHUH
7DEOHRI&RQWHQW

)ROORZLQJWKHFRQVLGHUDWLRQRIWKHILUVWPDQLIHVWDWLRQRIWKHPHQWDOSKDVHRI
SHUVRQDOPDJQHWLVPLQWKHSUHFHGLQJFKDSWHUZHQDWXUDOO\UHDFKWKHVHFRQG
PDQLIHVWDWLRQRIWKHVDPHQDPHO\7KHFRQVFLRXVSURMHFWLRQRIWKHPHQWDO
FXUUHQWIURPWKHEUDLQFHQWHUVE\WKHDFWLRQRIWKHZLOORIWKHLQGLYLGXDO
7KLVFRQVFLRXVSURMHFWLRQLQWXUQPD\EHVDLGWRFRQVLVWRIWZRIRUPVRI
PDQLIHVWDWLRQYL]  WKHSURMHFWLRQLQWRWKHSHUVRQDODWPRVSKHUHDQG  WKH
SURMHFWLRQRIDGLUHFWFXUUHQWXQGHUVSHFLDOFLUFXPVWDQFHVLQWRWKHPLQGRI
DQRWKHUSHUVRQIRUWKHSXUSRVHRIGLUHFWLQIOXHQFHXSRQKLPRUKHU/HWXV
FRQVLGHUWKHVHWZRIRUPVLQWXUQEHJLQQLQJZLWKWKHILUVWQDPHG
$VWRWKHQDWXUHRIWKHSURFHVVZKHUHE\RQHPD\SURMHFWKLVPHQWDOFXUUHQWV
LQWRKLVSHUVRQDODWPRVSKHUH,ZRXOGVD\WKDWWKHPHWKRGLVDOPRVWSUHFLVHO\
LGHQWLFDOZLWKWKDWZKHUHE\RQHSURMHFWVKLVSK\VLFDOPDJQHWLVPRUQHUYHIRUFH
LQWRKLVSHUVRQDODWPRVSKHUHDVIXOO\VHWIRUWKLQ&KDSWHU
$VLQWKHFDVHRISK\VLFDOPDJQHWLVPLVIRXQGWKDWWKHDYHUDJHSHUVRQFRORUV
KLVSHUVRQDODWPRVSKHUHE\WKHFKDUDFWHURIKLVPHQWDOVWDWHVRUUDWKHUE\WKH
SUHGRPLQDQWFRORURIKLVPHQWDODWWLWXGHZLWKRXWDQ\VSHFLDOHIIRUWRQKLVSDUW
7KHGHJUHHVRIFRORUȈQRWLWVSDUWLFXODUNLQGUHPHPEHUEXWLWVGHJUHHRIIRUFHȈ
GHSHQGVXSRQWKHGHJUHHRIPHQWDODFWLYLW\RIWKHSHUVRQ7KHSHUVRQRILQDFWLYH
WKRXJKWLGHDVRUIHHOLQJZLOOKDYHDQDOPRVWFRORUOHVVSHUVRQDODWPRVSKHUH
ZKLOHWKHSHUVRQRIWKHDFWLYHPLQGZLOOGLVSOD\DPDUNHGGHJUHHRIWKRXJKW
FRORUWKHUHLQ
:HILQGKHUHDOVRWKHVHFRQGFODVVRISHUVRQVZKRZKLOHQRWIXOO\
XQGHUVWDQGLQJWKHQDWXUHRIWKHSRZHURUWKHSURFHVVHVRISURMHFWLRQ
QHYHUWKHOHVVPDQLIHVWDKLJKGHJUHHRIWKRXJKWFRORUDQGSRZHULQWKHLUSHUVRQDO
DWPRVSKHUH7KLVVWURQJFRORUDQGSRZHUUHVXOWVIURPWKHIDFWWKDWVXFKSHUVRQV
DUHXVXDOO\LQGLYLGXDOVRIDKLJKGHJUHHRIIHHOLQJRULGHDOLVPȈWKDWLVWRVD\
WKH\H[SHULHQFHVWURQJIHHOLQJVRQWKHRQHKDQGRUHOVHKDYHVWURQJPHQWDO
LGHDVRIDQ\WKLQJLQZKLFKWKH\DUHLQWHUHVWHGȈRUSHUKDSVERWKVWURQJIHHOLQJ
DQGVWURQJLGHDOLVP
7KHVWURQJHVWFRORUDQGSRZHUPDQLIHVWHGE\SHUVRQVRIWKLVFODVVLVIRXQG
LQSHUVRQVZKRWDNHDVWURQJLQWHUHVWLQWKLQJV7KLVVWURQJLQWHUHVWUHDOO\
FRPELQHVWKHWZRHOHPHQWVRIIHHOLQJDQGDWWHQWLRQUHVSHFWLYHO\)HHOLQJLVD
FRPELQHVWKHWZRHOHPHQWVRIIHHOLQJDQGDWWHQWLRQUHVSHFWLYHO\)HHOLQJLVD
VWURQJPHQWDOHOHPHQWDQGDWWHQWLRQ\RXZLOOUHPHPEHULVDGLUHFWDSSOLFDWLRQ
RIWKHZLOO6RLWIROORZVWKDWVXFKSHUVRQVPXVWVWURQJO\SURMHFWWKHLUPHQWDO
VWDWHVLQWRWKHLUSHUVRQDODWPRVSKHUHDOWKRXJKXQFRQVFLRXVRIWKHVDPHDQG
ZLWKRXWDGHOLEHUDWHHPSOR\PHQWRIWKHZLOOIRUWKLVSXUSRVH
%XWKHUHDVLQWKHFDVHRIWKHSK\VLFDOPDJQHWLVPWKHVWURQJHVWDQGPRVW
SRZHUIXOHIIHFWLVSURGXFHGE\WKHLQGLYLGXDOVZKRXQGHUVWDQGVWKHSURFHVVDQG
ZKRFRQVFLRXVO\DQGGHOLEHUDWHO\SURMHFWWKHLUWKRXJKWLQWRWKHLUSHUVRQDO
DWPRVSKHUHZKHUHLWMRLQVDQGLVYLWDOL]HGE\WKHLUSK\VLFDOPDJQHWLVPVRWKDW
LWVIXOOHIIHFWLVPDQLIHVWHGXSRQWKRVHZKRPD\FRPHZLWKLQLWVILHOGRI
LQIOXHQFH
7KHSURFHVVRIXVLQJWKHZLOOLQWKHGLUHFWLRQRISURMHFWLQJWKRXJKWFRORUDQG
SRZHULQWRWKHSHUVRQDODWPRVSKHUHLVSUDFWLFDOO\LGHQWLFDOZLWKWKHXVHRIWKH
ZLOOLQWKHFDVHRISK\VLFDOPDJQHWLVPRUQHUYHIRUFHDVGHVFULEHGLQ&KDSWHU
,QRWKHUZRUGVLWFRQVLVWVRIWZRSKDVHVYL]  EHOLHILQRQH VSRZHUWRVR
SURMHFWDQG  WKHDFWXDOSURMHFWLRQE\WKHZLOO,KDYHLQIRUPHG\RXIXOO\
UHJDUGLQJWKHSDUWSOD\HGE\EHOLHILQWKLVSURFHVVRISURMHFWLRQDQGVKDOOVD\
QRWKLQJPRUHRQWKLVVXEMHFWKHUH7KHXVHRIWKHZLOOLQWKHPDWWHURISURMHFWLRQ
KHUHDOVRFRQVLVWVRIWKHDFWXDOZLOOLQJRUFRPPDQGLQJRIWKHWKLQJLWVHOI
7KHPHQWDOFXUUHQWVDUHYHU\REHGLHQWWRWKHZLOODQGLQIDFWGHSHQGDOPRVW
HQWLUHO\XSRQWKHZLOOIRUSRZHUWRPRYHDQGDFW$QGGRQRWIRUJHWWKLVIRULWLV
LPSRUWDQWWKHZLOOLVPRYHGODUJHO\E\GHVLUH,I\RXZLOOVWURQJO\GHVLUHWKDW
\RXUSHUVRQDODWPRVSKHUHEHFRORUHGE\\RXUWKRXJKWFXUUHQWVDQGZLOODWWKH
VDPHWLPHSLFWXUHWKHWKRXJKWFXUUHQWVIORZLQJRXWDQGILOOLQJ\RXUSHUVRQDO
DWPRVSKHUH\RXZLOOKDYHOLWWOHOHIWWRGRLQWKHGLUHFWLRQRIWKHFRQVFLRXVXVHRI
WKHZLOO7KLVEHFDXVHLQWKHILUVWSODFHWKHZLOOQDWXUDOO\RSHUDWHVDORQJWKH
OLQHVRIVWXQJGHVLUHDQGVHFRQGEHFDXVHWKHIRUPLQJRIWKHPHQWDOSLFWXUHZLOO
UHVXOWLQWKHXVHRIWKHDWWHQWLRQDQGWKHDWWHQWLRQDV,KDYHVDLGLVDSRVLWLYH
DQGGLUHFWDFWLRQRIWKHZLOOLQWKHGLUHFWLRQRIIRFXVLQJLWVSRZHU6R\RXVHH
E\IROORZLQJWKLVSODQ\RXDUHUHDOO\VHWWLQJLQWRRSHUDWLRQWKHSRZHURIWKHZLOO
LWVHOIDOWKRXJKQRWE\GLUHFWFRPPDQG<RXPD\DOVRXVHWKHGLUHFWFRPPDQGWR
WKHZLOOWRSURMHFWWKHWKRXJKWFXUUHQWVMXVWDV\RXXVHWKHVDPHWROLIW\RXUDUP
RUFORVH\RXUH\HV
7KHUHLVRQHRWKHULPSRUWDQWSRLQWWKRXJKZKLFK\RXPXVWPDNHQRWHRI
DQGDFWLYHO\HPSOR\LQ\RXUZRUNRIEXLOGLQJXSDQGPDLQWDLQLQJDVWURQJ
SRVLWLYHSHUVRQDODWPRVSKHUH,DOOXGHWRWKHSURFHVVRILQWHUPLQJOLQJDQG
FRPELQLQJWKHWZRHOHPHQWVRISHUVRQDOPDJQHWLVPLH  WKHSK\VLFDO
PDJQHWLVPDQG  WKHPHQWDOPDJQHWLVP:KLOHWKHUHLVDQDWXUDOFRPELQDWLRQ
DQGLQWHUPLQJOLQJRIWKHVHWZRZLWKRXWDQ\VSHFLDOHIIRUWRQ\RXUSDUW
QHYHUWKHOHVVDQHQRUPRXVO\JUHDWHUHIIHFWZLOOEHREWDLQHGE\DGLVWLQFWPHQWDO
SURFHVVRQ\RXUSDUWLQZKLFKSURFHVVLVFRPELQHGWKHVHYHUDOXVHVRIWKHZLOO
SURFHVVRQ\RXUSDUWLQZKLFKSURFHVVLVFRPELQHGWKHVHYHUDOXVHVRIWKHZLOO
DERYHUHIHUUHGWR7KLVVSHFLDOSURFHVVFRQVLVWVRIWKUHHGLVWLQFWPHQWDO
RSHUDWLRQVDVIROORZV
 <RXPXVWHDUQHVWO\GHVLUHWKHFRPELQDWLRQRIWKHWZRHOHPHQWVRI
SHUVRQDOPDJQHWLVPWKHSK\VLFDODQGWKHPHQWDOIRUFHV<RXPXVWFUHDWHWKH
VWURQJHVWNLQGRIGHVLUHIRUWKLVFRPELQDWLRQ7KLVGHVLUHPXVWEHVWURQJHUWKDQD
PHUHZDQWȈLWPXVWEHIDQQHGXSWRWKHVWDJHRIDQDFWXDOORQJLQJRU
FUDYLQJIRUWKHFRPELQDWLRQLQTXHVWLRQ  <RXPXVWXVHWKHLPDJLQDWLRQ
DFWLYHO\LQWKHGLUHFWLRQRIIRUPLQJDPHQWDOSLFWXUHRIWKHPLQJOLQJRIWKHWZR
IRUPVRIPDJQHWLVPMXVWDV\RXZRXOGSLFWXUHWKHFRPELQDWLRQRIWZRFORXGVRU
WZRFXUUHQWVRIZDWHULQDODNHIORZLQJLQIURPWZRGLIIHUHQWVRXUFHV7KH
VWURQJHUDQGPRUHYLYLG\RXFDQPDNHWKLVSLFWXUHWKHVWURQJHUDQGPRUH
HIIHFWLYHZLOOEHWKHUHVXOW,KDYHH[SODLQHGWKDWWKHVHPHQWDOSLFWXUHVUHTXLUH
WKHXVHRIWKHDWWHQWLRQDQGWKDWWKHDWWHQWLRQLVGXHWRDGLUHFWDQGFRQFHQWUDWHG
XVHRIWKHZLOO7KHUHIRUHWKHZLOOLVDFWLYHO\DQGSRZHUIXOO\HPSOR\HGLQWKLV
SURFHVVDQGWKHUHVXOWLVFRUUHVSRQGLQJO\HIIHFWLYH  7KHGLUHFWFRPPDQGRI
WKHZLOOLWVHOILQWKHGLUHFWLRQRIZLOOLQJWKHFXUUHQWVWRFRDOHVFHDQGFRPELQH
7KHVHWKUHHSKDVHVRIWKHXVHRIWKHZLOOFRPELQHGZLOOSURYHYHU\HIIHFWLYHLQ
WKHGLUHFWLRQQDPHV$OLWWOHSUDFWLFHZLOOHQDEOH\RXWRSHUIRUPDOOWKUHHRI
WKHPDWRQHWLPHDOPRVWDXWRPDWLFDOO\
<RXZLOOVHHE\DOLWWOHWKRXJKWWKDWWKHSURFHVVMXVWGHVFULEHGLVSUDFWLFDOO\
WKDWXVHGZKHQ\RXSHUIRUPDQ\FRQVFLRXVYROXQWDU\PRWLRQRIWKHERG\/HWXV
VHH<RXZLVKWRUDLVH\RXUKDQG:KDWSURFHVVHVDUHLQYROYHG"7KUHHDV
IROORZV  'HVLUHȈ\RXZLVKWRUDLVH\RXUKDQG  PHQWDOSLFWXUHȈIRUDOPRVW
XQFRQVFLRXVO\\RXIRUPWKHLPDJHRIWKHUDLVHGKDQGDQG  WKHGLUHFW
FRPPDQGRIWKHZLOOZKLFKLVWKHILQDOPHQWDOHIIRUW
7KHFRPELQDWLRQRIWKHWZRIRUPVRISHUVRQDOPDJQHWLVPWKHSK\VLFDODQG
WKHPHQWDOZRUNVDORQJWZROLQHVRIDFWLRQQDPHO\  WKHPHQWDOPDJQHWLVP
JLYHVFRORUDQGFKDUDFWHUWRWKHSK\VLFDOPDJQHWLVPDQG  WKHSK\VLFDO
PDJQHWLVPJLYHVYLWDOLW\DQGDFWLQJIRUFHWRWKHPHQWDOPDJQHWLVP,WPLJKWEH
VDLGDOPRVWWKDWWKHSK\VLFDOPDJQHWLVPJLYHVWKHERG\DQGPRYLQJIRUFHWRWKH
FRPELQDWLRQZKLOHWKHPHQWDOPDJQHWLVPJLYHVWKHVRXOWRLW(DFKUHGRXEOHV
WKHHIILFLHQF\RIWKHRWKHUE\WKHSRZHURIFRPELQDWLRQ
7KHRFFXOWLVWVLQIRUPXVWKDWWKHSHUVRQDODWPRVSKHUHLVFRPSRVHGRIFHUWDLQ
FRORUVGHSHQGLQJXSRQWKHSDUWLFXODUTXDOLW\RIPHQWDOVWDWHVWKDWKDSSHQWREH
SUHGRPLQDQWLQWKHFRPELQDWLRQȈHDFKPHQWDOVWDWHEHLQJVDLGWRKDYHLWVRZQ
FRORU,VKDOOQRWWDNHXSWKLVSKDVHRIWKHVXEMHFWEXWPHUHO\PHQWLRQLWEHFDXVH
RILWVJHQHUDOLQWHUHVWLQWKLVFRQQHFWLRQ
7KHRFFXOWLVWVDOVRLQIRUPXVWKDWZKHQWKHFRPELQDWLRQRIWKHWZRHOHPHQWV
RIPDJQHWLVPFRPELQHWKHPHQWDOPDJQHWLVPWDNHVRQDGHHSHUDQGPRUH
RIPDJQHWLVPFRPELQHWKHPHQWDOPDJQHWLVPWDNHVRQDGHHSHUDQGPRUH
SURQRXQFHGFRORUDQGKXHDQGDSSHDUVDOVRWRVROLGLI\DQGEHFRPHGHQVHUDQG
WKDWWKHSK\VLFDOPDJQHWLVPVHHPVWREHUHQGHUHGGRXEO\DFWLYHLWVLQFUHDVHG
HQHUJ\EHLQJHYLGHQFHGE\WLQ\VSDUNVDQGGDQFLQJJOLWWHULQJDWRPV,WVHHPVWR
EHOLNHWKHFRPELQDWLRQRIWZRGLIIHUHQWFKHPLFDOVHDFKWHQGLQJWRLQFUHDVHWKH
SRWHQF\DQGDFWLYLW\RIWKHRWKHUDQGWKHWZRFRPELQLQJLQWKHSURGXFWLRQRI
SDUWLFXODUO\SRWHQWDQGDFWLYHQHZWKLQJ
)URPWKHVDPHVRXUFHVZHOHDUQWKDWWKHDXUDRUSHUVRQDODWPRVSKHUHRIWKH
SHUVRQZKRXVHVWKHZLOOLQWKHGLUHFWLRQRIIRUPLQJWKHSRWHQWFRPELQDWLRQRI
WKHWZRIRUPVRIPDJQHWLVPVHHPVWREHDOPRVWDOLYHVRILOOHGZLWKHQHUJ\LVLW
,WLVVDLGWKDWZKHQLWFRPHVLQFRQWDFWZLWKRWKHUSHUVRQVȈSDUWLFXODUO\ZKHQWKH
RZQHULVXVLQJKLVPLQGWRLPSUHVVDQGLQIOXHQFHWKHRWKHUVȈWKHDXUDZLOOUHDFK
RXWDQGDFWXDOO\HQIROGWKHRWKHUSHUVRQVZLWKLQLWVILHOGRIHQHUJ\VHHPLQJO\
WU\LQJWRHPEUDFHWKHSHUVRQDQGKROGKLPVXEMHFWWRWKHYLEUDWLRQRILWVRZQHU V
PLQG
:KHQ\RXOHDUQWRSURGXFHWKLVFRPELQDWLRQHIIHFWLYHO\\RXZLOOEHJLQWR
QRWLFHWKDW\RXZLOODOPRVWXQFRQVFLRXVO\DIIHFWDQGLQIOXHQFHRWKHUSHUVRQVZLWK
ZKRP\RXFRPHLQFRQWDFW<RXZLOOQRWLFHWKDWWKH\ZLOOEHJLQWRWDNHRQ\RXU
PRRGVDQGJHQHUDOIHHOLQJVDQGWKDWWKH\ZLOOIDOOLQWXQHZLWK\RXUPHQWDO
YLEUDWLRQVJHQHUDOO\,I\RXDUHHQWKXVLDVWLFDERXWDQ\WKLQJWKH\ZLOOEHJLQWR
PDQLIHVWHQWKXVLDVP$QGVRRQHDFKRI\RXUPHQWDOVWDWHVUHJLVWHULQJDQHIIHFW
XSRQWKHRWKHUSHUVRQV0RUDO+ROGRQO\WKRVHPHQWDOVWDWHVZKLFK\RXZLVK
RWKHUWRWDNHRQ
$QGNHHS\RXULQQHURSLQLRQVDQGGHVLJQVZHOOWRWKHEDFNRI\RXUPLQGE\
DQHIIRUWRIWKHZLOODQGVKRZRQO\ZKDW\RXZLVKWREHVHQVHGE\RWKHUVIRU
UHPHPEHU\RXUWKRXJKWFXUUHQWVZLOOKDYHEHFRPHZRQGHUIXOO\G\QDPLFDQG
SRZHUIXO
&KDSWHU
0DJQHWLF&XUUHQWV
7DEOHRI&RQWHQW

7KHPDJQHWLFHQHUJ\RIWKHSHUVRQIRUPHGE\DFRPELQDWLRQRIKLVSK\VLFDODQG
PHQWDOIRUFHOLNHDOORWKHUIRUPVRIPDJQHWLFRUHOHFWULFIRUFHWHQGVWRUXQLQ
FXUUHQWVDQGWREHWUDQVPLWWHGLQZDYHV7KHSHUVRQDODWPRVSKHUHRIWKHSHUVRQ
LVLQIDFWFRPSRVHGRIPDQ\ZDYHVRIPDJQHWLFHQHUJ\FLUFOLQJDURXQGWKH
FRQILQHVRIKLVDXUDDFRQVWDQWZDYHOLNHPRWLRQEHLQJPDLQWDLQHGDQGDUDSLG
UDWHRIYLEUDWLRQDOZD\VEHLQJPDQLIHVWHG
,WLVWKHVHZDYHVRIPDJQHWLFHQHUJ\ZKLFKZKHQFRPLQJLQFRQWDFWZLWKWKH
PLQGRIRWKHUSHUVRQVVHWXSDFRUUHVSRQGLQJUDWHRIYLEUDWLRQWKHUHDQGWKXV
SURGXFHDPHQWDOVWDWHLQWKHPFRUUHVSRQGLQJWRWKDWRIWKHSHUVRQVHQGLQJIRUWK
WKHPDJQHWLVP$V,KDYHDOUHDG\VWDWHGVHYHUDOWLPHVWKHSK\VLFDOPDJQHWLVP
JLYHVWKHERG\DQGHQHUJL]LQJTXDOLW\WRWKLVSHUVRQDOPDJQHWLVPZKLOHWKH
PHQWDOPDJQHWLVPVXSSOLHVWKHTXDOLW\RIFRORURUFKDUDFWHUWRLW
$WWKLVSRLQW,ZLVKWRGLJUHVVIRUDIHZPRPHQWVLQRUGHUWRPDNHFOHDUWR
\RXUPLQGWKHLPSRUWDQWIDFWWKDWLQFKDUJLQJWKHPHQWDODWPRVSKHUHZLWKWKH
FRPELQHGPHQWDODQGSK\VLFDOPDJQHWLVPLWLVQRWQHFHVVDU\WRPDNHWZR
GLVWLQFWDQGVHSDUDWHGHIIRUWVRIWKHZLOO,QGHVFULELQJDQGH[SODLQLQJWR\RXWKH
SURFHVVRIVHQGLQJIRUWKHFXUUHQWVRISK\VLFDOPDJQHWLVPDQGPHQWDO
PDJQHWLVPUHVSHFWLYHO\,KDYHEHHQFRPSHOOHGWRWDNHXSHDFKSKDVH
VHSDUDWHO\DQGGHVFULEHWKHDFWLRQRIWKHZLOOLQWKHSURFHVVRISURMHFWLQJHDFKRI
WKHVHSKDVHVRISHUVRQDOPDJQHWLVP$QGLI,ZHUHWRVD\QRPRUHRQWKLVSRLQW
WKHVWXGHQWPLJKWEHOHIWZLWKWKHLPSUHVVLRQWKDWLQRUGHUWRIXOO\FKDUJHKLV
SHUVRQDODWPRVSKHUHZLWKWKHFRPELQHGZDYHVRISK\VLFDODQGPHQWDO
PDJQHWLVPKHZRXOGKDYHWRILUVWFKDUJHLWZLWKRQHNLQGRIPDJQHWLVPDQG
WKHQZLWKWKHRWKHU7KLVLVQRWFRUUHFWIRUDFRPELQHGHIIRUWRIWKHZLOOLVDOO
WKDWLVUHTXLUHGDV\RXVKDOOQRZVHH
,WLVSRVVLEOHWRFRPELQHWKHPHQWDOSLFWXUHRIWKHWZRIRUPVRISHUVRQDO
PDJQHWLVPWKHSK\VLFDODQGWKHPHQWDOLQWRRQHLPDJHRULGHDLQWKHPLQG,WLV
DOVRSRVVLEOHWRFRPELQHWKHWZRLQWRWKHGHVLUHRULQFOLQDWLRQWRSURMHFWWKH
HQHUJ\$QGLWLVHTXDOO\SRVVLEOHWRFRPELQHWKHSURMHFWLRQRIWKHWZRLQWRRQH
HIIRUWRIWKHZLOO,WLVDVLPSOHWKLQJȈDVVLPSOHDVWKDWRIWZLVWLQJWZRVLON
WKUHDGVWKUHDGLQJWKHPLQWRWKHH\HRIDFRDUVHQHHGOHDQGWKHQWDNLQJVWLWFKHV
ZLWKWKHQHHGOH7KLQNRIWKHSK\VLFDODQGPHQWDOPDJQHWLVPDVWZRWZLVWHG
ZLWKWKHQHHGOH7KLQNRIWKHSK\VLFDODQGPHQWDOPDJQHWLVPDVWZRWZLVWHG
WKUHDGVLQVHUWHGLQWRWKHH\HRI\RXUQHHGOHRIZLOODQGWKHQWKLQNRI\RXU
SDVVLQJWKHVHWKUHDGVWRJHWKHULQWRWKHIDEULFE\VLPSO\SXVKLQJWKHQHHGOH
WKURXJK7KLVLOOXVWUDWLRQZLOOHQDEOH\RXWRIRUPDFOHDUHUPHQWDOSLFWXUHRIWKH
SURFHVV
<RXZLOOILQGWKDWDIWHUDOLWWOHSUDFWLFH\RXZLOOLQVWLQFWLYHO\FRPELQHWKH
WZRWKUHDGVLQWKHH\HRIWKHQHHGOHRI\RXUZLOO$WILUVW\RXPD\ILQGLWHDVLHU
WRILUVWWKLQNRIWKHSK\VLFDOPDJQHWLVPDQGWKHQRIWKHPHQWDOȈVRWRVSHDN
WKUHDGLQJILUVWWKHRQHWKUHDGDQGWKHQWKHRWKHU%XWDIWHUYHU\OLWWOHSUDFWLFH\RX
ZLOOILQGLWHDVLHUWRWDNHXSWKHWZRWKUHDGVDWRQFHJLYLQJWKHPDOLWWOHWZLVW
WRJHWKHUDQGWKHQSDVVLQJERWKRIWKHPWKURXJKWKHH\HRIWKHZLOOQHHGOHDWWKH
VDPHWLPH5HPHPEHUWKHQOHDUQWRWZLVWWRJHWKHUWKHWKUHDGVRIWKHWZR
NLQGVRIPDJQHWLVPVRWKDWWKHZLOOPD\SXVKWKHPERWKWKURXJKDWWKHVDPH
WLPH
<RXVKRXOGNHHSWKHSHUVRQDODWPRVSKHUHZHOOFKDUJHGDWDOOWLPHVE\
SURMHFWLQJPDJQHWLVPLQWRLWVHYHUDOWLPHVDGD\1RVSHFLDOWLPHVRUQXPEHURI
WLPHVLVDEVROXWHO\QHFHVVDU\Ȉ\RXPXVWXVH\RXURZQMXGJPHQWDQGIHHOLQJLQ
WKLVPDWWHU<RXZLOOVRRQOHDUQWRIHHOZKHQ\RXUPDJQHWLFDXUDLVZHDNDQG
ZKHQLWLVVWURQJ7KHVHWKLQJVFRPHWRRQHE\SUDFWLFHDQGDFWXDOH[SHULHQFH
DQGFDQQRWYHU\ZHOOEHWDXJKWH[FHSWWKURXJKDFWXDOH[SHULHQFH<RXZLOOVRRQ
OHDUQZKDWLWLVWRIHHOWKHFRQGLWLRQRI\RXUPDJQHWLVPMXVWDV\RXQRZIHHO
KHDWRUKXPLGLW\RUWKHUHYHUVHWKHUHRI
,I\RXDUHDERXWWRFRPHLQWRFRQWDFWZLWKRWKHUVZKRP\RXZLVKWR
LQIOXHQFHRURQWKHRWKHUKDQGLI\RXDUHDERXWWRFRPHLQFRQWDFWZLWKRWKHUV
ZKRPD\ZDQWWRLQIOXHQFH\RX\RXVKRXOGFKDUJH\RXUVHOIZHOOZLWK
PDJQHWLVPȈWKDWLVWRVD\\RXVKRXOGJHQHUDWHDQGSURMHFWLQWR\RXUSHUVRQDO
DWPRVSKHUHDODUJHDPRXQWRIPDJQHWLVPZKLFKZLOOWKXVUHQGHU\RXUDXUD
VWURQJDQGSRVLWLYHLQVWHDGRIZHDNDQGQHJDWLYH7KHSULQFLSDOWKLQJLQEDWWOHLV
WREHIXOO\SUHSDUHGIRUDQ\HPHUJHQF\DQGWKLVUXOHLVDSSOLFDEOHWRWKHFDVHRI
WKHXVHVRISHUVRQDOPDJQHWLVPLQ\RXUGHDOLQJZLWKRWKHUSHUVRQV
5HPHPEHUWKHQWRFRPELQHWKHLGHDDQGLPDJHRIWKHFRPELQHGPDJQHWLVP
ZKHQSURMHFWLQJRUFKDUJLQJZLWKSHUVRQDOPDJQHWLVPȈWKHWZRWZLVWHGWKUHDGV
LQWKHQHHGOHUHPHPEHU
1RZWRUHWXUQWRWKHVXEMHFWRIPDJQHWLFFXUUHQWV
7KHFXUUHQWVRIPDJQHWLVPQRWRQO\FRQVWDQWO\IORZDURXQGZLWKLQWKHOLPLWV
RIWKHDXUDEXWDOVRRIWHQSXVKIRUZDUGWRZDUGRWKHUSHUVRQVZKRDWWUDFWWKH
DWWHQWLRQRIWKHSHUVRQ,QVXFKFDVHVWKHDXUDVHHPVWRVWUHWFKRXWWRZDUGWKH
RWKHUSHUVRQVDQGHYHQWRHQYHORSWKHPLQLWVIROGV5HPHPEHU,DPQRZ
VSHDNLQJRIWKHLQYROXQWDU\DFWLRQRIWKHDXUDRUPDJQHWLFFXUUHQWVQRWRIWKH
FRQVFLRXVDQGGHOLEHUDWHSURMHFWLRQRIWKHFXUUHQWVIURPWKHPLQGWRWKHRWKHU
PLQG7KHUHLVDQDOPRVWDXWRPDWLFDFWLRQRIWKHDXUDRUPDJQHWLFFXUUHQWVLQWKH
PLQG7KHUHLVDQDOPRVWDXWRPDWLFDFWLRQRIWKHDXUDRUPDJQHWLFFXUUHQWVLQWKH
ZD\MXVWVWDWHGZKHQDQRWKHUSHUVRQDURXVHVWKHLQWHUHVWRUDWWHQWLRQRIWKH
SHUVRQ
2IFRXUVHLI\RXLQVLVWXSRQWKHVWULFWHVWVFLHQWLILFLQWHUSUHWDWLRQRIWKLV
DSSDUHQWO\DXWRPDWLFPRYHPHQWRIWKHFXUUHQWV,PXVWDGPLWWKDWHYHQLQVXFK
FDVHVWKHZLOORIWKHSHUVRQLVWKHGLUHFWFDXVHRIWKHSURMHFWLRQ)RULWPXVWEH
UHPHPEHUHGWKDWLQWKHPHQWDODFWVRILQWHUHVWDQGDWWHQWLRQWKHUHLVD
QRQGHOLEHUDWHDFWLRQRIWKHZLOOȈDQDXWRPDWLFDFWLRQVRWRVSHDN7KHZLOOLV
FDOOHGLQWRRSHUDWLRQWKHPRPHQWWKHDWWHQWLRQLVDWWUDFWHGȈLQIDFWWKHDWWHQWLRQ
LVDSRVLWLYHDFWRIWKHZLOO$QGFRQVHTXHQWO\WKHZLOOVHWVLQWRPRWLRQWKH
PDJQHWLFFXUUHQWVLQWKHGLUHFWLRQRIWKHREMHFWRIDWWHQWLRQ
6R\RXZLOOVHHZKHQ\RXDUHFRQYHUVLQJZLWKDQRWKHUSHUVRQRUDGGUHVVLQJ
DQXPEHURISHUVRQV\RXDUHUHDOO\VHQGLQJLQWKHLUGLUHFWLRQDVHULHVRIFXUUHQWV
RISHUVRQDOPDJQHWLVPWKHYLEUDWLRQVRIZKLFKPXVWDIIHFWWKHPXQOHVVWKHLU
RZQYLEUDWLRQVDUHRIDPRUHSRVLWLYHQDWXUH,QIDFWYHU\PDQ\PHQRIWKH
JUHDWHVWSHUVRQDOIRUFHZKRVHSHUVRQDOPDJQHWLVPPD\DFWXDOO\EHIHOWHPSOR\
WKHIRUFHLQWKLVPDQQHUDQGPDNHEXWOLWWOHXVHRIWKHGLUHFWIODVKPHWKRGVRI
LPPHGLDWHFRQFHQWUDWHGPDJQHWLFIRUFHZKLFK\RXZLOOEHDVNHGWRFRQVLGHULQ
WKHVXFFHHGLQJFKDSWHUV7KHLUJHQHUDOVWRUHRISHUVRQDOPDJQHWLVPLVVRJUHDWȈ
WKHLUSHUVRQDODWPRVSKHUHVRFKDUJHGȈWKDWPHUHFRQWDFWZLWKLWSURGXFHVWKH
UHVXOW
%XWZKLOHWKHDERYHJHQHUDOPHWKRGRIPDJQHWLFLQIOXHQFHLVYHU\HIIHFWLYH
SURYLGHGWKHLQGLYLGXDOKDVOHDUQHGWRVXIILFLHQWO\FKDUJHKLPVHOILWVWLOOUHPDLQV
WKDWWKHPHWKRGLVWKDWRIWKHVKRWJXQDVFRPSDUHGWRWKDWRIWKHULIOHDQGXVHV
XSPXFKSRZHUZKLOHDVPDOOHUDPRXQWZRXOGVXIILFH(YHU\WKLQJSRLQWVWRWKH
YDOXHRIDFRQFHQWUDWHGIRUFHUDWKHUWKDQWKDWRIWKHVFDWWHUHGHQHUJ\$WWKHODVW
KRZHYHUWKHEHVWPHWKRGLVWKDWZKLFKHPSOR\HHVERWKWKHVKRWJXQDQGULIOH
PHWKRGVȈWKHULIOHEXOOHWJRLQJULJKWWRWKHPDUNVXUURXQGHGE\DFORXGRI
IO\LQJVKRWVZKLFKFRPSOHWHVWKHZRUNDQGUHQGHUVVXFFHVVFHUWDLQ6R
WKHUHIRUHZKHQ\RXEHFRPHLQWHUHVWHGLQWKHGLUHFWIODVKPHWKRGVLQWKH
VXFFHHGLQJFKDSWHUVGRQRWORVHVLJKWRIWKHLPSRUWDQWSDUWLQSHUVRQDOLQIOXHQFH
SOD\HGE\WKHJHQHUDOHIIHFWRIWKHPDJQHWLVPRIWKHDXUD
%HIRUH,OHDYHWKLVVXEMHFW,ZLVKWRH[SODLQDFHUWDLQELWRISKHQRPHQD
ZKLFKKDVSX]]OHGPDQ\VWXGHQWVRISHUVRQDOPDJQHWLVP,DOOXGHWRWKH
DSSDUHQWO\XQFRQVFLRXVXVHRIPDJQHWLFSRZHUZKLFKZHVRRIWHQZLWQHVV)RU
LQVWDQFH\RXPD\EHWKLQNLQJLQWHQWO\RIVRPHRWKHUSHUVRQZLWKRXWDQ\
FRQVFLRXVLQWHQWLRQRILQIOXHQFLQJWKHPLQDQ\PDQQHUDQG\HWZKHQ\RXPHHW
WKHSHUVRQDIWHUZDUGRUKHDUIURPKLP\RXZLOOILQGWKDW\RXUPDJQHWLFFXUUHQWV
KDYHLQIOXHQFHGKLPRIWHQYHU\PDUNHGO\VR7KLVLVSX]]OLQJZKHQ\RX
UHPHPEHUWKDW\RXPDGHQRHIIRUWWRLQIOXHQFHWKHSHUVRQE\WKHGLUHFWIODVK
UHPHPEHUWKDW\RXPDGHQRHIIRUWWRLQIOXHQFHWKHSHUVRQE\WKHGLUHFWIODVK
PHWKRGDQGZKHQ\RXUHPHPEHUWKDWWKHSHUVRQZDVIDUUHPRYHGIURP\RXU
SHUVRQDODWPRVSKHUHRUDXUD:KDWLVWKHDQVZHU\RXDVN"
7KHH[SODQDWLRQLVWKLV%\\RXUFRQFHQWUDWHGDWWHQWLRQDQGLQWHUHVW\RXKDYH
DFWLYHO\ WKRXJKXQFRQVFLRXVO\VHWWKHZLOOLQWRPRWLRQDQGWKHUHVXOWLVWKDW
WKHUHKDVEHHQSURMHFWHGWRZDUGWKHRWKHUSHUVRQDFXUUHQWRI\RXUPDJQHWLVPD
JUHDWVWUHWFKLQJRXWRI\RXUSHUVRQDODWPRVSKHUHLQKLVGLUHFWLRQȈDQGKHKDV
EHHQDIIHFWHGE\LWMXVWDVLIKHKDGEHHQLQ\RXUSUHVHQFH2IFRXUVHWKHRWKHU
SHUVRQZLOOQRWEHJUHDWO\DIIHFWHGE\\RXUFXUUHQWVXQOHVVWKHVHKDSSHQWREH
FKDUJHGZLWKJUHDWSK\VLFDOPDJQHWLVPDQGVWURQJO\FRORUHGE\\RXUPHQWDO
VWDWXV%XWQHYHUWKHOHVVWKHUHZLOODOZD\VEHVRPHLQIOXHQFHH[HUWHGXQOHVV
LQGHHGWKHRWKHUSHUVRQLVPRUHSRVLWLYHPDJQHWLFDOO\WKDWDUH\RXLQZKLFK
FDVHKHZLOOQRWEHDIIHFWHGLQWKHOHDVW
6R\RXVHHZHQRWRQO\DUHFRQVWDQWO\VXUURXQGHGE\DQDXUDRUDWPRVSKHUH
RIRXUPDJQHWLFFXUUHQWVEXWDUHDOVRPRUHRUOHVVXQFRQVFLRXVO\VHQGLQJIRUWK
FXUUHQWVRIRXUPDJQHWLVPLQWRWKHDXUDRIRWKHUVZKLFKH[HUWPRUHRUOHVV
LQIOXHQFHXSRQWKHP,QWKHVDPHZD\WKHFXUUHQWVRIRWKHUVDUHFRQVWDQWO\
UHDFKLQJRXUDXUDDQGH[HUWLQJPRUHRUOHVVLQIOXHQFHXSRQXVXQOHVVZH
KDSSHQWREHPRUHSRVLWLYHWKDQWKH\LQWKHPDWWHURIRXUYLEUDWLRQVȈRU QRWH
WKLV XQOHVVZHGHOLEHUDWHO\XVHDQHIIRUWRIWKHZLOOLQWKHGLUHFWLRQVKXWWLQJWKH
GRRURQWKHVHRXWVLGHYLEUDWLRQV
&KDSWHU
7KH'LUHFW)ODVK
7DEOHRI&RQWHQW

:HQRZDSSURDFKDSKDVHRIWKHJHQHUDOVXEMHFWRISHUVRQDOPDJQHWLVPZKLFK
LVKLJKO\LPSRUWDQWDVZHOODVPRVWLQWHUHVWLQJWRWKHVWXGHQWEHFDXVHRILWV
VWULNLQJDQGVWDUWOLQJIHDWXUHV7KLVSKDVHFRQVLVWVRIWKHGHOLEHUDWHFRQVFLRXV
SURMHFWLRQRISHUVRQDOPDJQHWLVPLQWRWKHDXUDRIDQRWKHUSHUVRQRUSHUVRQVRU
LQWRWKHDWPRVSKHUHRIDFURZGRISHUVRQV7KLVPHWKRGKDVEHHQFDOOHGWKH
GLUHFWIODVKEHFDXVHLWUHVHPEOHVWKHIODVKRIWKHHOHFWULFVSDUNUDWKHUWKDQWKH
GLIIXVHGGLVFKDUJHRIDVWHDG\FXUUHQWRIHOHFWULFLW\
7KHGLUHFWIODVKLVWKHPHWKRGHPSOR\HGLQSURMHFWLQJDSRVLWLYHLQIOXHQFH
LQWKHGLUHFWLRQRIRWKHUVȈDPHQWDOFRPPDQGEDFNHGXSE\WKHFRPELQHG
SK\VLFDODQGPHQWDOPDJQHWLVP7KHPHWKRGLV  7KHIRUPLQJLQWKHPLQGRID
GLUHFWFRPPDQGDFFRPSDQLHGE\DPHQWDOSLFWXUHRIWKHGHVLUHGDFWLRQRQWKH
SDUWRIWKHRWKHUSHUVRQ  WKHPHQWDOJDWKHULQJRIWKHWZRFRPELQHGIRUPVRI
PDJQHWLVPLQWRRQHIRUFHDQG  WKHGHOLEHUDWHGLVFKDUJHRIWKHIODVKE\WKH
ZLOO
<RXKDYHEHHQIXOO\LQVWUXFWHGUHJDUGLQJWKHILUVWWZRSKDVHVRIWKLVGLUHFW
IODVKPHWKRGDQG\RXKDYHEHHQJLYHQJHQHUDOLQIRUPDWLRQZKLFKZLOOHQDEOH
\RXWRFRPSUHKHQGWKHWKLUGSKDVHLHWKDWRIWKHGHOLEHUDWHGLVFKDUJHRIWKH
IODVK E\WKHZLOO7KDWLVWRVD\\RXXQGHUVWDQGWKHIRUPLQJRIWKHPHQWDO
SLFWXUHDQGWKHSURMHFWLRQRIPDJQHWLVPLQFRQQHFWLRQZLWKWKHJDWKHULQJXSRI
WKHWZRIRUPVRIPDJQHWLVPDQG\RXOLNHZLVHDUHDFTXDLQWHGZLWKWKHSRZHU
DQGDFWLRQRIWKHZLOOLQWKHZRUNRISURMHFWLQJPDJQHWLVP$OO\RXQHHGWR
FRPSHWHWKHLQVWUXFWLRQUHJDUGLQJWKHPHWKRGRIXVLQJWKHGLUHFWIODVKLVDOLWWOH
IXUWKHULQVWUXFWLRQUHJDUGLQJWKHXVHRIWKHZLOOLQSURMHFWLQJWKLVGHOLEHUDWH
GLVFKDUJH$QGWKLVIXUWKHULQVWUXFWLRQ,VKDOOQRZJLYH\RX
7KHNH\WRWKHGLUHFWIODVKFRQVLVWVLQWKHGHOLEHUDWHDFWLRQRIWKHZLOOLQ
SURMHFWLQJRUIODVKLQJLQWRWKHPLQGRIWKHRWKHUSHUVRQDFHUWDLQGLUHFW
VWDWHPHQWRUFRPPDQGEDFNHGXSE\DOOWKHPDJQHWLFIRUFHVZLWKLQ\RX7KLV
FRPHVHDVLO\DQGUDSLGO\DVWKHUHVXOWRIDOLWWOHSUDFWLFH$QGPRUHRYHU\RX
PD\SUDFWLFHLQSULYDWHVWDQGLQJEHIRUH\RXUPLUURUXQWLO\RXDFTXLUHWKHPHQWDO
PHFKDQLFDOHDVHZKLFKLVQHFHVVDU\
/HWXVQRZEHJLQZLWKVRPHFRQFUHWHH[DPSOHVUDWKHUWKDQFRQWLQXLQJWKH
JHQHUDOFRQVLGHUDWLRQ,QRWKHUZRUGVOHWXVQRZJHWGRZQWREUDVVWDFNVLQ
JHQHUDOFRQVLGHUDWLRQ,QRWKHUZRUGVOHWXVQRZJHWGRZQWREUDVVWDFNVLQ
WKHPDWWHU
3UHOLPLQDU\([HUFLVH6WDQGEHIRUH\RXUPLUURUJD]HSRVLWLYHO\DQGILUPO\DW
\RXURZQLPDJHWKHUHLQMXVWDV\RXZRXOGJD]HWRZDUGDQRWKHUSHUVRQ,QIDFW
\RXPXVWWU\WRLPDJLQHWKDW\RXDUHUHDOO\JD]LQJDWDQRWKHUSHUVRQ7KHQVHQG
WKDWLPDJLQDU\SHUVRQȈSLFWXUHGE\\RXUUHIOHFWHGLPDJHȈWKHPHVVDJH,DP
VWURQJHUWKDQ\RX
1RZWU\WRJHWP\H[DFWPHDQLQJDV,SURFHHG<RXPXVWQRWUHVWFRQWHQW
ZLWKPHUHO\WKLQNLQJRUVD\LQJWKHZRUGVRIWKHPDJQHWLFFRPPDQGDERYHJLYHQ
Ȉ\RXPXVWFXOWLYDWHDQGGHYHORSDQDFWXDOZLOOLQJWKHFRPPDQGMXVWDV\RX
ZRXOGZLOOWKHUDLVLQJRI\RXUKDQGRUWKHFOHQFKLQJRI\RXUILVW<RXZLOOILQGLW
QHFHVVDU\WRFXOWLYDWHWKLVSRZHURIVRZLOOLQJIRU\RXUEHOLHIZLOOQRWDWILUVW
FRRUGLQDWHZLWKWKHZLOO<RXFRXOGQRWYHU\ZHOOZLOO\RXUKDQGWREHOLIWHGRU
ILVWFOHQFKHGXQOHVV\RXDFWXDOO\EHOLHYHGWKDWWKHWKLQJLWVHOIZHUHSRVVLEOH,Q
WKHVDPHZD\WKHOLWWOHFKLOGKDVWRILUVWOHDUQWKHSRVVLELOLW\RIKLVXVLQJKLVZLOO
GHOLEHUDWHO\LQSHUIRUPLQJSK\VLFDODFWLRQV+HILUVWVHHVRWKHUVSHUIRUPLQJ
FHUWDLQDFWLRQVDQGWKHLGHDJUDGXDOO\GDZQVXSRQKLPWKDWKHWRRPD\GR
WKHP7KHQKHEHJLQVWRXVHKLVZLOODZNZDUGO\DWILUVWLQGLUHFWLQJWKHPXVFOHV
DVUHTXLUHG,QWKHVDPHZD\ZLOO\RXKDYHWRGHYHORS\RXUDELOLW\WRXVH\RXU
ZLOOGHOLEHUDWHO\LQWKHGLUHFWLRQRIWKLVIRUPRISHUVRQDOPDJQHWLVP"%XWE\D
OLWWOHVWHDG\HDUQHVWSUDFWLFHEHIRUHWKHPLUURU\RXZLOOVRRQPDVWHUWKH
PHFKDQLVPRIWKHWKLQJȈWKHUHVWZLOOEHDOODPDWWHURISUDFWLFHXSRQSHUVRQV
,QVHQGLQJWKHPHVVDJH,DPVWURQJHUWKDQ\RX\RXPXVWDFFRPSDQ\WKH
HIIRUWRIWKHZLOO E\ZKLFK\RXVHQGIRUWKWKHWKRXJKWFRPPDQG ZLWKDVWURQJ
PHQWDOFRQYLFWLRQWKDW\RXUDUHVWURQJHU PDJQHWLFDOO\ WKDQKLPDQGDOVRZLWK
WKHEHOLHIWKDWKHZLOOEHLPSUHVVHGE\WKLVIDFWDQGZLOODFFHSW\RXUVWDWHPHQW
<RXPXVWJHW\RXUVHOILQWRWKHPHQWDODWWLWXGHRIGHPDQGLQJWKDWKHDFFHSW\RXU
VWDWHPHQWQRWWKDW\RXPHUHO\UHTXHVWKLPWRGRVR,QWKLVIRUPRIPDJQHWLF
LQIOXHQFHWKHUHLVQRVXFKWKLQJDVUHTXHVWLQJȈLWLVDOODPDWWHURILQVLVWHQW
FRPPDQGȈGRQRWIRUJHWWKLV:KHQ\RXPHUHO\UHTXHVW\RXXVXDOO\WDNH
VHFRQGPDJQHWLFSRVLWLRQJLYLQJWRWKHRWKHUSHUVRQWKHILUVWSODFH%XWZKHQ
\RXFRPPDQG\RXWDNHWKHILUVWSODFH\RXUVHOIDQGSXVKKLPLQWRWKHVHFRQG
,QSUDFWLFLQJEHIRUH\RXUPLUURUUHPHPEHUWKLVDQGHQGHDYRUWRUDLVH\RXUVHOI
LQWRWKHILUVWSRVLWLRQ<RXZLOONQRZZKHQ\RXKDYHGRQHWKLVE\WKHSHFXOLDU
IHHOLQJRIVXSHULRUPDJQHWLFVWUHQJWKWKDW\RXZLOOH[SHULHQFH
$IWHUKDYLQJPDVWHUHGWKHDERYHH[HUFLVHWR\RXURZQVDWLVIDFWLRQȈWKDWLV
XQWLO\RXKDYHWKRURXJKO\DFTXLUHGWKHIHHOLQJRIPDVWHU\DQGPDJQHWLF
VXSHULRULW\ZKHQ\RXVHQGIRUWKWKHIODVKRIFRPPDQGȈ\RXPD\SURFHHGWRWKH
IROORZLQJZKLFKLVEDVHGXSRQWKHILUVWDQGUHVXOWVIURPLW,PHDQWKDW\RXDUH
QRZLQDSRVLWLRQWRSUDFWLFHWKLVVHFRQGVWDJHRIWKHH[HUFLVHEHIRUHWKHPLUURU
<RXZLOOIHHOOLNHEHJLQQLQJWRWU\\RXUSRZHUXSRQRWKHUSHUVRQVEXW\RX
<RXZLOOIHHOOLNHEHJLQQLQJWRWU\\RXUSRZHUXSRQRWKHUSHUVRQVEXW\RX
ZRXOGGREHWWHUWRZDLWXQWLO\RXKDYHWKRURXJKO\PDVWHUHGWKHPHFKDQLVPRI
PDJQHWLVPEHIRUHWKHPLUURU
7KLVVHFRQGVWDJHRIWKHSUHOLPLQDU\PLUURUH[HUFLVHLVVXPPHGXSLQWKH
ZRUGRIPHQWDOPDJQHWLFFRPPDQGZKLFK\RXDGGUHVVWRWKHLPDJLQDU\SHUVRQ
UHSUHVHQWHGE\\RXUUHIOHFWHGLPDJHYL],FDQFRPPDQG\RXWRDFW7KLVDV
\RXZLOOVHHE\DFDUHIXOFRQVLGHUDWLRQRIWKHZRUGVLVUHDOO\DWUHPHQGRXVO\
SRZHUIXOVWDWHPHQWDQGLWZLOOUHTXLUHDJUHDWH[HUFLVHRIRXUSRZHURIEHOLHI
DQGPHQWDOLPDJHU\WRJHW\RXUVHOILQWRWKHSURSHUPHQWDOVWDWHVRWKDWWKHZLOO
PD\WUDYHOHDVLO\RQLWVSDWKWRHQIRUFHWKHFRPPDQG5HPHPEHUWKDWLQRUGHU
IRUWKHZLOOWREHDEOHWRPRYHVPRRWKO\RYHULWVFKDQQHOVRWKDWLWPD\UHDFKWKH
PDUNLWLVQHFHVVDU\WKDW\RXFOHDUDZD\DQ\REVWDFOHVWKDWPD\UHPDLQLQ\RXU
RZQPLQG,WLVHQRXJKIRUWKHZLOOWRKDYHWRILJKWDQGEUHDNGRZQWKHREVWDFOHV
LQWKHPLQGRIWKHRWKHUSHUVRQZLWKRXWDOVREHLQJFDOOHGRQWRFRPEDWDQG
RYHUFRPHWKHREVWDFOHVLQRXURZQPLQG6R\RXPXVWJHW\RXUVHOILQWKHSURSHU
PHQWDOVWDWHEHIRUH\RXFDQKRSHWRLQIOXHQFHRWKHUV
:KHQ\RXVHQGIRUWKWKHPHQWDOFRPPDQGWRWKHUHIOHFWHGLPDJH\RXPXVW
FRQFHQWUDWHDWUHPHQGRXVSRZHURIPHDQLQJLQWKHVWDWHPHQW,FDQFRPPDQG
\RXWRDFW7KHVWDWHPHQWPXVWEHDFFRPSDQLHGE\WKHIXOOIRUFHRI\RXURZQ
FRQYLFWLRQDQGEHOLHIWKDW\RXFDQVRFRPPDQGDQGWKDW\RXZLOOEHREH\HG
$QGLQRUGHUWRGRWKLV\RXZLOOKDYHWRDURXVHLQ\RXUVHOIWKHIXOO
FRQVFLRXVQHVVRI\RXURZQPDJQHWLFIRUFHVRWKDW\RXFDQIDLUO\IHHOLWYLEUDWLQJ
LQDQGDURXQG\RX<RXZLOOKDYHWRUHUHDGWKHVHLQVWUXFWLRQVVHYHUDOWLPHV
EHIRUHWKH\ZLOOEHFRPHSHUIHFWO\FOHDUWR\RX,QIDFW\RXZLOOKDYHWREHJLQ
SUDFWLFLQJDQGWKHQUHUHDGLQJWKHPEHWZHHQH[HUFLVHVEHIRUH\RXZLOOJHWWKH
IXOOPHDQLQJ7KHPHDQLQJZLOOJUDGXDOO\XQIROGLQWR\RXUXQGHUVWDQGLQJDV\RX
SURFHHGZLWK\RXUSUDFWLFLQJ,WLVMXVWDVLI,ZHUHJLYLQJ\RXGLUHFWLRQVDVWR
PDVWHULQJWKHDUWRIVNDWLQJȈ\RXZRXOGQRWUHDOO\JUDVSWKHIXOOPHDQLQJRIWKH
LQVWUXFWLRQVXQWLO\RXEHJDQDFWXDOO\SUDFWLFLQJRQWKHLFHȈDQGHDFKWLPH\RX
ZRXOGUHIHUWRWKHERRN\RXZRXOGSHUFHLYHDQHZPHDQLQJWRWKHZRUGV6RLW
LVLQWKHFDVHEHIRUHXVȈ\RXZLOOXQGHUVWDQGWKHLQVWUXFWLRQVIXOO\RQO\ZKHQ
\RXEHJLQWKHDFWXDOSUDFWLFH
1RZDIWHU\RXKDYHJRWWHQWRWKHSRLQWLQWKHPLUURUSUDFWLFHZKHUH\RXDUH
DEOHWRDFWXDOO\IHHOWKDW\RXKDYHVHQWIRUWKWRWKHUHIOHFWHGLPDJHWKHFRPPDQG
WKDW\RXDUHVWURQJHUWKHUHE\IRUFLQJWKHRWKHUSHUVRQLQWRWKHVHFRQGPDJQHWLF
SODFHȈDQGDOVRWKDW\RXFDQFRPPDQGWKHRWKHUSHUVRQWRDFWDV\RXZLOO
WKHUHE\SODFLQJKLPLQWKHVXERUGLQDWHFDSDFLW\RIDFWLRQȈ\RXPD\SURFHHGWR
WU\XSRQWKHUHIOHFWHGLPDJHVRPHVSHFLDOFRPPDQGVLQWKHVDPHVSLULW1RZGR
QRWIDOOLQWRWKHHUURURIVXSSRVLQJWKDWDOOWKLVPLUURUSUDFWLFHLVPHUHO\FKLOG V
SOD\,I\RXGR\RXZLOOEHPDNLQJDJUHDWPLVWDNHIRULWLVDQ\WKLQJEXWSOD\
SOD\,I\RXGR\RXZLOOEHPDNLQJDJUHDWPLVWDNHIRULWLVDQ\WKLQJEXWSOD\
RULGOHSDVWLPH,WLVWKHOHDUQLQJRIWKHPHFKDQLVPRIWKHGLUHFWIODVKEHIRUH
\RXVWDUWLQWRUXQWKHPDFKLQHLQHDUQHVW,WLVOLNHWKHSHULRGRISUHOLPLQDU\
SUDFWLFHLQDQ\WKLQJZKLFKSUHFHGHVWKHDFWXDOSHUIRUPDQFH,WLVWKHUHKHDUVDO
ZKLFKPXVWSUHFHGHWKHSOD\'RQRWIDLOWRIDLWKIXOO\SHUIRUPWKHUHKHDUVDO
H[HUFLVHVEHIRUH\RXEHJLQWRPDQLIHVW\RXUPDJQHWLVPLQHDUQHVW<RXPXVW
IXOO\DFTXDLQW\RXUVHOIZLWK\RXUPDJQHWLFPDFKLQHEHIRUH\RXEHJLQWRUXQLWLQ
HDUQHVW
7KHSUHFHGLQJSUDFWLFHH[HUFLVHVPD\EHIROORZHGE\DVLPLODUSUDFWLFHRI
VHQGLQJIRUWKIODVKHVRIDQ\WKLQJWKDW\RXPD\ZLVKWRDFWXDOO\VHQGWRRWKHU
SHUVRQVODWHURQ<RXPD\VXSSO\WKHVHFRPPDQGVIRU\RXUVHOIRU\RXPD\
SUDFWLFHRQWKHIROORZLQJH[FHOOHQWFRPPDQGVDOORIZKLFKDUHOLNHO\WREHXVHG
E\\RXLQ\RXUDFWXDOPDQLIHVWDWLRQRISHUVRQDOPDJQHWLVP
7KHVHFRPPDQGVPD\EHYDULHGRIFRXUVHWRVXLW\RXUWDVWHV7KH\PXVWDOO
EHGHOLYHUHGEHIRUHWKHPLUURULQH[DFWO\WKHVDPHPDQQHUDV,KDYHDOUHDG\
VWDWHG
/RRNDWPH
*LYHPH\RXUIXOODWWHQWLRQ
&RPHWKLVZD\
*RDZD\IURPPHȈOHWPHDORQH
<RXOLNHPH<RXORYHPH
<RXIHHOOLNHGRLQJDV,ZLVK\RXWRGR
<RXZDQWWRSOHDVHPH
<RXZLOODJUHHWRP\SURSRVLWLRQ
*HWRXWRIP\ZD\
<RXDUHDWWUDFWHGWRZDUGPH
,IDVFLQDWH\RX
,DP\RXU0$67(5
&RPH%HTXLFNDQGGRDV,WHOO\RX
<RXDUHUHFHSWLYHWRP\ZLVKHV
<RXDUHUHVSRQVLYHWRP\ZLOO
&KDSWHU
([HUFLVHVLQWKH'LUHFW)ODVK
7DEOHRI&RQWHQW

$QGQRZKDYLQJPDVWHUHGWKHSUHOLPLQDU\PLUURUH[HUFLVHV\RXUHUHDG\WR
EHJLQ\RXUH[SHULPHQWVRQUHDOSHUVRQV%XWKHUHWRR\RXPXVWFUDZOEHIRUH
\RXFDQZDONDQGUXQ<RXPXVWEHJLQZLWKWKHVLPSOHUIRUPVRIPDJQHWLF
LQIOXHQFHEHIRUH\RXFDQDFFRPSOLVKWKHPRUHFRPSOLFDWHGRUGLIILFXOWWDVNV
%XW\RXKDYHQRZHPHUJHGIURPWKHNLQGHUJDUWHQVWDJHDQGDUHUHDG\WR
SUDFWLFHLQHDUQHVW,I\RXKDYHIDLWKIXOO\IROORZHGWKHLQVWUXFWLRQVLQWKHPLUURU
SUDFWLFH\RXKDYHPDVWHUHGWKHPHFKDQLVPRIPDJQHWLFLQIOXHQFHDQGDUHUHDG\
WRUXQWKHPDFKLQHLQSXELFYLHZ%XWGRQRWIRUDPRPHQWORVHZKDW\RXKDYH
JDLQHGLQWKHPLUURUH[HUFLVH+ROGWLJKWDQGIDVWWRWKHWHFKQLTXH\RXKDYH
DFTXLUHGDQGGRQRWIRUDPRPHQWIDOOLQWRWKHHUURUWKDW\RXPXVWQRZEHJLQDOO
RYHUDJDLQ7KHWKLQJIRU\RXWRUHPHPEHUDOZD\VLVWKDW\RXDUHUHDOO\EXW
FDUU\LQJWKHPLUURUH[HUFLVHVIRUZDUGRQDKLJKHUVFDOHLQDEURDGHUILHOG$QG
\RXZLOOILQGVRPHLQWHUHVWLQJZRUNDKHDGRI\RX7DNHP\ZRUGIRULW
)LUVW([HUFLVH,VKDOOQRZJLYH\RXDQH[HUFLVHWKDWLVDOPRVWDOZD\VJLYHQ
WREHJLQQHUVE\WKHEHVWWHDFKHUVRIPDJQHWLVP,WFRQVLVWVRIWKHSURFHVVRI
FDXVLQJDSHUVRQDKHDGRI\RXRQWKHVWUHHWWRWXUQDURXQGDVLIKHKDGKHDUG
VRPHRQHFDOORXWWRKLPE\QDPH7KHSURFHVVLVYHU\VLPSOH<RXKDYHEXWWR
ZDONVRPHOLWWOHGLVWDQFHEHKLQGWKHRWKHUSHUVRQRQWKHVWUHHWSDUNRURWKHU
SXEOLFSODFH&RQFHQWUDWH\RXUIL[HGDWWHQWLRQRQWKHSHUVRQJD]LQJDWWKHORZHU
EDFNSDUWRIKLVKHDG$QGVHQGLQJKLPILUVWDVWURQJIODVKRIPDJQHWLFIRUFHWKLV
EHLQJIROORZHGE\WKHGLUHFWIODVKFRPPDQG+HUH\RX7XUQDURXQGMXVWDV
LI\RXZHUHDFWXDOO\FDOOLQJRXWDORXGWRKLP<RXPD\HYHQZKLVSHUWKHZRUGV
VRVRIWO\WKDWQRRQHHOVHFDQKHDUWKHPȈWKLVPD\KHOS\RXWRSXWIRUFHLQWRWKH
FRPPDQGDWILUVWEXW\RXZLOOVRRQRXWJURZWKHQHHGRIWKHVDPH$WWKHWLPH
\RXVHQGWKHIODVKFRPPDQG\RXPXVWDFWXDOO\:,//WKDWWKHSHUVRQZLOO
DURXQGLQ\RXUGLUHFWLRQ3XWDOOWKHPDJQHWLFIRUFHZLWKLQ\RXLQWKLVHIIRUW
<RXZLOOILQGWKDWLQVRPHFDVHVWKHRWKHUSHUVRQZLOOWXUQKLVKHDGDOPRVWDW
RQFHDQGORRNLQTXLULQJO\EHKLQGKLPLQ\RXUGLUHFWLRQ,QWKHPDMRULW\RIFDVHV
KRZHYHUKHZLOOWDNHDORQJHUWLPHDERXWLW+HZLOOEHDSWWRILUVWJURZXQHDV\
DQGUHVWOHVVDQGEHJLQE\JODQFLQJIURPVLGHWRVLGHDVLIORRNLQJIRUVRPHRQH
WKHQKHZLOODOPRVW EXWQRWTXLWH WXUQKLVKHDGDURXQGWKHQILQDOO\KHZLOO
JODQFHEDFNZDUGVRPHZKDWIXUWLYHO\DQGVXVSLFLRXVO\1RWZRSHUVRQVDFW
JODQFHEDFNZDUGVRPHZKDWIXUWLYHO\DQGVXVSLFLRXVO\1RWZRSHUVRQVDFW
SUHFLVHO\DOLNHLQWKLVUHVSHFWDQGWKHQDJDLQWKHVDPHSHUVRQZLOODFW
GLIIHUHQWO\XQGHUGLIIHUHQWFRQGLWLRQV7KHUHDUHFHUWDLQWLPHVDWZKLFKWKH
FRQGLWLRQVVHHPWREHPRUHIDYRUDEOHWKDQDWRWKHUVIRUYDULRXVUHDVRQVDV\RX
ZLOOGLVFRYHUIRU\RXUVHOI
<RXZLOOILQGLQWKLVDVZHOODVWKHIROORZLQJRWKHUH[HUFLVHVWKDWWKHEHVW
UHVXOWVZLOOEHREWDLQHGZKLOHWKHRWKHUSHUVRQLVSURFHHGLQJLGO\DORQJZLWKRXW
KLVDWWHQWLRQEHLQJGLUHFWHGSDUWLFXODUO\LQDQ\GLUHFWLRQ
:KHQWKHDWWHQWLRQLVIUHHWKHPLQGLVPRUHRSHQWRRXWVLGHLQIOXHQFHV
:KHQWKHRWKHUSHUVRQ VDWWHQWLRQLVILUPO\IL[HGRQDQ\WKLQJHOVHLWZLOOEH
IRXQGGLIILFXOWWRLQIOXHQFHKLPWRDQ\PDUNHGGHJUHH7KLVLVWKHUHVXOWRIDQ
HVWDEOLVKHGUXOHRISV\FKRORJ\DQGZLOOEHIRXQGWREHRSHUDWLYHLQDOOFDVHVDV
IRULQVWDQFHLI\RXFDOODSHUVRQZKHQKHLVSUHRFFXSLHGHLWKHUZLWKGHHS
WKRXJKWRUHOVHZKHQKLVVXUURXQGLQJVKHZLOOSUREDEO\QRWKHDU\RXFDOOKLP
WKRXJKXQGHURWKHUFRQGLWLRQVKHZRXOGWXUQUHDGLO\7KHVDPHUXOHLVRIFRXUVH
RSHUDWLYHLQWKHFDVHRIPDJQHWLFLQIOXHQFH
6HFRQG([HUFLVH:KHQLQFKXUFKWKHDWUHRURWKHUSXEOLFSODFHRUHYHQLQD
URRPIXOORIFRPSDQ\IL[\RXUJD]HDWWKHORZHUEDFNRIWKHKHDGRIVRPH
SHUVRQLQWKHSODFHDQGVHQGKLPWKHGLUHFWIODVKFRPPDQG+HUH\RX7XUQ
DURXQGDQGORRNDWPH8VLQJDOOWKHPDJQHWLFIRUFHZLWKLQ\RXDQGSXWWLQJWKH
IRUFHRI\RXUZLOOEDFNRIWKHFRPPDQG
<RXZLOOQRWLFHWKHVDPHSHFXOLDUUHVXOWDVLQWKHSUHFHGLQJH[HUFLVHLHWKH
ILGJHWLQJLQWKHVHDWWKHXQHDVLQHVVDQGUHVWOHVVQHVVWKHILQDOTXLFNWXUQRIWKH
KHDGLQ\RXUGLUHFWLRQIROORZHGE\WKHFRQIXVHGH[SUHVVLRQRIFRXQWHQDQFH,Q
ERWKRIWKHVHFDVHV\RXVKRXOGPDLQWDLQDFDOPXQLQWHUHVWHGJD]HDKHDG
DSSDUHQWO\QRWQRWLFLQJWKHSHUVRQ,WLVQRWZHOOWRKDYHSHUVRQVJHWWKHLGHDWKDW
\RXDUHH[SHULPHQWLQJXSRQWKHPDWDQ\WLPH7KHUHLVQRSRZHUVRSRWHQWDV
WKHVLOHQWUHVHUYHGSRZHU6RNHHS\RXURZQFRXQVHODQGGRQRWVFDWWHUDQG
ZHDNHQ\RXUIRUFHE\WDONLQJDERXWLWWRRWKHUVIDUOHVVE\ERDVWLQJDERXWLW
7KHUHDUHFHUWDLQJRRGSV\FKRORJLFDODQGRFFXOWUHDVRQVIRUP\DGPRQLWLRQ
UHJDUGLQJNHHSLQJ\RXURZQFRXQVHODQGQRWGLVVLSDWLQJ\RXUHQHUJ\E\WDONLQJ
DERXWLWRUUHYHDOLQJLWWRRWKHUV,VKDOOQRWVD\PRUHRQWKHVXEMHFWDWWKLVWLPHȈ
EXW,ZDQW\RXWRUHPHPEHUZKDW,KDYHVDLGDQGWRKHHGLW
7KLUG([HUFLVH7KLVLVDYDULDWLRQRIWKHILUVWH[HUFLVHDQGFRQVLVWVRI
PDNLQJWKHSHUVRQDKHDGRI\RXWXUQWRWKHULJKWRUWRWKHOHIWZKLOHZDONLQJ
DKHDGRI\RX7KLVPD\IROORZ\RXUH[HUFLVHRIPDNLQJKLPWXUQDURXQG:KHQ
KHDSSURDFKHVDQRWKHUSHUVRQVHQGKLPDIODVKWRPRYHWRWKHULJKWRUWRWKH
OHIWDV\RXZLOO<RXPD\DOVRFRPPDQGDSHUVRQLQOLNHPDQQHUZKHQKHLV
DSSURDFKLQJ\RX<RXZLOOEHVXUSULVHGDW\RXUVXFFHVVLQWKLVGLUHFWLRQDIWHUD
OLWWOHSUDFWLFH,QWKHFDVHRIDYHU\VHQVLWLYHVXEMHFW\RXFDQFDXVHKLPRUKHU
WR]LJ]DJLQDFRPLFDOPDQQHU'RQRWRYHUGRWKLVKRZHYHURU\RXPD\GHIHDW
WR]LJ]DJLQDFRPLFDOPDQQHU'RQRWRYHUGRWKLVKRZHYHURU\RXPD\GHIHDW
\RXURZQREMHFWEHVLGHVEHLQJXQNLQGWRWKHVHQVLWLYHSHUVRQ
)RXUWK([HUFLVH7KLVLVDYDULDWLRQRIWKHVHFRQGH[HUFLVHDQGFRQVLVWVLQ
PDNLQJWKHVHDWHGSHUVRQLQIURQWRI\RXWXUQDQGJODQFHWRWKHULJKWDQGWKHQ
WRWKHOHIWDV\RXZLOO'XULQJWKHH[HUFLVHZKLFKPD\H[WHQGRYHUVRPHWLPH
\RXPD\REWDLQVRPHYHU\PDUNHGUHVXOWVIURPWKHH[SHULPHQWLQVRPHFDVHV
$VEHIRUH,FDXWLRQ\RXDJDLQVWJRLQJWRRIDUZLWKWKHH[SHULPHQWOHVW\RXEH
QRWLFHGE\RWKHUVDQGDOVREHFDXVHLWLVQRWIDLUWRWKHVXEMHFW
)LIWK([HUFLVH,QWKLVH[SHULPHQW\RXFRPPDQGWKHRWKHUSHUVRQWRGURSKLV
FDQHRUXPEUHOODHWFRUKHUIDQKDQGNHUFKLHIHWF,QVKRUW\RXFDXVHWKHRWKHU
SHUVRQWRSHUIRUPVRPHOLWWOHPXVFXODUDFWLRQXQGHUWKHFRQWURORI\RXUZLOO
6L[WK([HUFLVH7KHDERYHH[HUFLVHPD\EHYDULHGE\VHQGLQJSDVVLQJ
SHUVRQVYDULRXVFRPPDQGVZKLOH\RXDUHVHDWHGDW\RXUZLQGRZRURQ\RXU
SRUFKHWF<RXPD\SXWLQDQLQWHUHVWLQJKRXULQVHQGLQJIODVKHVWRWKHSDVVLQJ
FURZGRQHDWDWLPHRIFRXUVHDQGWKHQQRWLQJWKHSHUFHQWDJHRIVXFFHVVHV<RX
ZLOOILQGWKDWWKHSHUFHQWDJHZLOOYDU\EXWWKHJHQHUDOGHJUHHRIVXFFHVVVKRXOG
VORZO\EXWVWHDGLO\LQFUHDVHRQWKHDYHUDJH'RQRWPDNHWKHWHVWVWRR
FRPSOLFDWHGEXWVHQGWKHIODVKWRSHUIRUPVRPHYHU\VLPSOHPRWLRQ<RXZLOO
EHVXUSULVHGWRGLVFRYHUZKDWDODUJHSHUFHQWRIWKHSHUVRQVZLOOJODQFHLQ\RXU
GLUHFWLRQHYHQWKRXJK\RXKDYHQRWSDUWLFXODUO\FRPPDQGHGWKHPWRGRVR7KLV
ODWWHUUHVXOWRFFXUVEHFDXVHRIHWKJHQHUDODWWUDFWLRQWKDWWKH\ZLOOIHHOWRZDUG
\RXE\UHDVRQRIWKHLQIOXHQFHRI\RXUPDJQHWLFZDYH
6HYHQWK([HUFLVH:KLOH,KDYHDGYLVHG\RXWRORRNGLUHFWO\DWWKHRWKHU
SHUVRQVLQVHQGLQJWKHIODVKWKLVLVQRWDEVROXWHO\QHFHVVDU\DIWHU\RXKDYHIXOO\
DFTXLUHGWKHPHFKDQLVPRIWKHIODVK,QIDFWDIWHUDVKRUWWLPH\RXZLOOEH
DEOHWRREWDLQWKHUHVXOWHYHQWKRXJK\RXUH\HVDUHWXUQHGLQDQRWKHUGLUHFWLRQ,W
LVQRW\RXUH\HWKDWLQIOXHQFHVWKHPEXWPHUHO\WKDWE\JD]LQJLQWHQWO\\RX
PDQDJHWRILUPO\FRQFHQWUDWH\RXUDWWHQWLRQDQGZLOOLQWKHLUGLUHFWLRQ<RXPD\
WU\WKHH[SHULPHQWRIJD]LQJVWUDLJKWDKHDGRI\RXLQDSXEOLFSODFHRURQWKH
VWUHHWDQGWKHQIODVKLQJWKHFRPPDQGWRWKHRWKHUSHUVRQWRORRNDW\RXDQG\RX
ZLOOILQGWKDW\RXZLOOPHHWZLWKTXLWHDODUJHSHUFHQWDJHRIVXFFHVVSDUWLFXODUO\
DIWHU\RXKDYHVXFFHHGHGZLWKWKHJD]LQJSODQRISURFHGXUH
(LJKWK([HUFLVH$IWHUKDYLQJPDVWHUHGWKHDERYHH[HUFLVH\RXPD\SURFHHG
WRDVWLOOKLJKHUIRUPRIPDJQHWLFLQIOXHQFHQDPHO\WKDWRILQIOXHQFLQJWKH
VSHHFKRIDQRWKHUSHUVRQ<RXSURFHHGLQWKLVFDVHLQWKHVDPHJHQHUDOPDQQHU
DVLQWKHH[HUFLVHVMXVWJLYHQ:KHQDSHUVRQLVVSHDNLQJWR\RX\RXPD\SXW
ZRUGVLQWRKLVPRXWKE\DVWURQJPHQWDOFRPPDQGRUPDJQHWLFIODVK'RQRW
WU\WRPDNHKLPVD\DZKROHVHQWHQFHȈDWOHDVWDWILUVW5DWKHUEHJLQE\ZDLWLQJ
XQWLOKHSDXVHVLQKLVVSHHFKDQGWKHQVWURQJO\ZLOODFHUWDLQZRUGWRKLPȈD
ZRUGWKDWZLOOQDWXUDOO\ILWLQWRKLVVHQWHQFHȈDQGKHZLOOEHYHU\DSWWRUHSHDWLW
ZRUGWKDWZLOOQDWXUDOO\ILWLQWRKLVVHQWHQFHȈDQGKHZLOOEHYHU\DSWWRUHSHDWLW
$IWHUDOLWWOHSUDFWLFH\RXFDQPDNHKLPUHSHDWDQDEVXUGZRUGRUWRVWDPPHU
KDOWDQGVWXWWHULQKLVVSHHFKLI\RXVRZLOOLW$IWHUVWLOOPRUHSUDFWLFH\RXPD\
VXFFHHGLQFDXVLQJKLPWRUHSHDWDZKROHVHQWHQFHRUHYHQPRUHWRH[SUHVVWKH
WKRXJKW\RXKDYHSXWLQWRKLVPLQGRUWRDVNVRPHTXHVWLRQZKLFK\RXKDYH
ZLOOHGWKDWKHVKRXOGDVN
<RXZLOOUHDGLO\VHHE\WKLVWLPHWKDWDFRQVWDQWSUDFWLFHDORQJWKHVHOLQHV
ZLOOUHVXOWLQ\RXUDFTXLULQJWKHSRZHUWRZLOODQGPDJQHWLFDOO\LQIOXHQFH
DQRWKHUSHUVRQWRGRPDQ\WKLQJVLQUHVSRQVHWR\RXUZLOODQGVLOHQWFRPPDQG
,QIDFWDFRQVWDQWGHYHORSPHQWDORQJWKHVHOLQHVZLOOPDNHRIRQHDYHU\JLDQWLQ
PDJQHWLFSRZHUZKRVHUHVXOWVDUHSURSRUWLRQHGRQO\E\WKHGHJUHHRIPDJQHWLF
IRUFHRIRWKHUSHUVRQVRUWKHGHJUHHRISHUVLVWHQWSUDFWLFHDQGGHYHORSPHQWRQ
KLVRZQSDUW
%XW,ZLVKWRFDXWLRQ\RXDWWKLVSRLQWDJDLQVWXVLQJWKLVSRZHUIRUDQ\
XQZRUWK\SXUSRVH7KLVFDXWLRQGRHVQRWDULVHIURPPHUHO\DPRUDOPRWLYHRQ
P\SDUWEXWIURPNQRZOHGJHRIFHUWDLQSV\FKLFODZVZKLFKFDXVHDUHDFWLRQ
HTXDOLQJWKHDFWLRQDQGZKLFKZLOOEULQJVRUU\UHVXOWVWR\RXLI\RXYLRODWHWKH
UXOH6RORQJDV\RXXVH\RXUQHZIRXQGSRZHUIRUSXUHO\VFLHQWLILFH[SHULPHQWV
RUOHJLWLPDWHSXUSRVHVRIKXPDQDVVRFLDWLRQDOOYHU\ZHOODQGJRRG%XWQHYHU
SURVWLWXWH\RXUSRZHUWRDFFRPSOLVKXQZRUWK\RUFULPLQDOHQGVOHVW\RXEHFRPH
LQYROYHGLQDVWRUPRI\RXURZQUDLVLQJRUHQPHVKHGLQDZHERIRXURZQ
ZHDYLQJ7KHUHDUHFHUWDLQSV\FKLFDOODZVDVZHOODVSK\VLFDOODZVZKLFKPXVW
QRWEHEURNHQȈDQGWKLVLVRQHRIWKHP7KLVLVSDUWLFXODUO\WUXHRIWKHFDVHRID
SHUVRQXVLQJWKHSRZHUIRUWKHSXUSRVHRILQIOXHQFLQJWKHRWKHUVH[LQDQ
LPPRUDOGLUHFWLRQ$OOWKHROGRFFXOWZULWHUV FDXWLRQSDUWLFXODUO\DJDLQVWWKLV
SUDFWLFH6RKHHGWKHDGYLFHDQGGRWKHULJKWWKLQJRQO\ZLWK\RXUSRZHU
&KDSWHU
7KH3RVLWLYH$XUD
7DEOHRI&RQWHQW

1RZWKDW\RXKDYHPDVWHUHGWKHWHFKQLTXHRIWKHPHFKDQLVPRIWKHGLUHFW
IODVK\RXDUHUHDG\WRSURFHHGWRWKHDFWXDOGHPRQVWUDWLRQDQGFRQWDFWZLWKWKH
JHQHUDOSXEOLF%XWEHIRUHWDNLQJXSWKDWSKDVHRIWKHVXEMHFW,WKLQNLWZHOOWR
DVN\RXWRFRQVLGHUWKHPDWWHURIWKHFUHDWLRQDQGPDLQWHQDQFHRIWKHSRVLWLYH
DXUD,KDYHSXUSRVHO\SRVWSRQHGWKHFRQVLGHUDWLRQRIWKLVSKDVHRIWKHVXEMHFW
XQWLOZHUHDFKHGWKLVSDUWLFXODUSRLQWLQWKHLQVWUXFWLRQEHFDXVHLQRUGHUWR
SURSHUO\FUHDWHDQGPDLQWDLQWKHSRVLWLYHDXUDLWLVQHFHVVDU\WKDWRQH
XQGHUVWDQGVWKHPHFKDQLVPDQGWHFKQLTXHRIWKHGLUHFWIODVKIRUKHZLOOQHHG
WRPDQLIHVWWKHVDPHSRZHULQWKHFDVHRIWKHSRVLWLYHDXUD%XWQRZWKDW\RX
KDYHPDVWHUHGWKHWHFKQLTXHRUPHFKDQLVPRIWKHGLUHFWIODVK\RXDUHUHDG\WR
UHFHLYHWKHLQVWUXFWLRQUHJDUGLQJWKHSRVLWLYHDXUDDQGZHPD\DVZHOOSURFHHG
WRFRQVLGHULWDWWKLVYHU\SRLQW
,KDYHDOUHDG\JLYHQ\RXLQVWUXFWLRQVUHJDUGLQJWKHFXOWLYDWLRQRIDGHVLUDEOH
SHUVRQDODWPRVSKHUHRUDXUDDQGQHHGQRWUHSHDWKHUHZKDW,KDYHDOUHDG\VDLG
HOVHZKHUH%XWDPRPHQW VFRQVLGHUDWLRQZLOOVKRZ\RXWKDWWKHUHZLOODULVH
FHUWDLQFRQGLWLRQVRURFFDVLRQVLQZKLFK\RXZLOOILQGLWYHU\GHVLUDEOHWREHDEOH
WRLQIOXHQFHDQXPEHURISHUVRQVHQPDVVHȈWKHFURZGDVDZKROHȈUDWKHUWKDQ
WRVHQGWKHGLUHFWIODVKWRHDFKRIWKHLQGLYLGXDOVVHSDUDWHO\2IFRXUVHWKH
FURZGZLOOEHLQIOXHQFHGE\\RXUJHQHUDOSHUVRQDODWPRVSKHUHEXW\RXQRZ
QHHGVRPHWKLQJPRUHSRVLWLYHDQGPRUHWRWKHSRLQW$QGWKHSRVLWLYHDXUDLV
ZKDW\RXPXVWDFTXLUHWRVDWLVI\WKLVUHTXLUHPHQW
7KHSRVLWLYHDXUDLVVLPSO\WKHJHQHUDOSHUVRQDODWPRVSKHUHEXWGLUHFWO\DQG
SRVLWLYHO\FKDUJHGE\DFRQFHQWUDWHGHIIRUWRIWKHZLOOȈWKHVDPHHIIRUWLQIDFW
DVWKDWPDGHLQWKHFDVHRIWKHGLUHFWIODVK
/HWPHLOOXVWUDWHWKHSRVLWLYHDXUDE\PHDQVRIVHYHUDOVWRULHVIURPUHDOOLIH
ȈWKHH[SHULHQFHVRIVHYHUDOVWXGHQWVRIPLQH7KHVHSHUVRQDOH[SHULHQFHVZLOO
JLYH\RXDEHWWHULGHDRIMXVWZKDWLVQHHGHGWKDQZRXOGSDJHVRIJHQHUDO
LQVWUXFWLRQRQWKHVXEMHFW7KHOLWWOHVWRULHVDUHQRWILFWLRQUHPHPEHUEXWDUH
WDNHQIURPOLIHDQGDUHELWVRIKXPDQGRFXPHQWVIURPWKHOLYHVRIUHDOSHRSOH
DOORIZKLFKKDYHFRPHXQGHUP\SHUVRQDOREVHUYDWLRQDQGFRQVLGHUDWLRQ
6HYHUDO\HDUVDJRLQ3DULV,KDGDVWXGHQWZKRVHUHDOVWUHQJWKRIFKDUDFWHU
ZDVPDUUHGE\KHUDEQRUPDOVHOIFRQVFLRXVQHVVVK\QHVVWLPLGLW\DQG
ZDVPDUUHGE\KHUDEQRUPDOVHOIFRQVFLRXVQHVVVK\QHVVWLPLGLW\DQG
VHQVLWLYHQHVVȈLQIDFWLQWKHZRUGVHQVLWLYHQHVV\RXKDYHWKHNH\QRWHRIWKLV
\RXQJZRPDQ VSHUVRQDOLW\6KHZDVD\RXQJDUWLVWRIIDUPRUHWKDQWKHDYHUDJH
WDOHQWDQGKHUFKDUPRIPDQQHUUHQGHUHGKHUFRPSDQ\VRXJKWDIWHUE\DODUJH
FLUFOHRIIULHQGV
7KLVODG\FRPSODLQHGWRPHWKDWVKHVXIIHUHGIURPWKHDFWXDOUXGHQHVVQD\
DQGDOPRVWSRVLWLYHEUXWDOLW\RIWKHFURZGVRISHUVRQVWKURQJLQJWKHEXV\VWUHHWV
RIVRPHRIWKHSULQFLSDOWKRURXJKIDUHVRI3DULV6KHFRPSODLQHGWKDWVKHZDV
MRVWOHGKHUHDQGWKHUHDQGSXVKHGUXGHO\DVLGHE\WKHSDVVLQJWKURQJ0RUHRYHU
VKHZDVWUHDWHGUXGHO\LQWKHVKRSVWKHVXSHUILFLDOYHQHHURISROLWHQHVVRIWKH
DYHUDJH3DULVLDQVKRSFOHUNVFDUFHO\FRQFHDOLQJWKHXQGHUO\LQJFRQWHPSWDQG
YHLOHGVQHHURIWKHVHFKHDSVDWHOOLWHVRIWKHXELTXLWRXVVKRSNHHSHUVRIWKLV
FKDUPLQJFLW\
0\ILUVWWKRXJKWZDVWKDWWKH\RXQJZRPDQKDGZRUNHGKHUVHOIXSLQWRD
VWDWHRILPDJLQDU\ZURQJVWKHUHVXOWRIKHUKLJKO\VHQVLWLYHRUJDQLVPDQG
VKULQNLQJGLVSRVLWLRQȈLQVKRUW,WKRXJKWWKDWVKHZDVVXIIHULQJIURPDVWDWHRI
PRUELGVHOIFRQVFLRXVQHVVZLWKLWVIUHTXHQWDFFRPSDQLPHQWRILPDJLQDU\
SHUVHFXWLRQHWF6R,GHWHUPLQHGWRWHVWRXWWKHPDWWHUDQGDVFHUWDLQIRUP\VHOI
MXVWKRZPXFKWUXWKZDVLQWKHFDVH
0DNLQJDVOLJKWFKDQJHLQP\SHUVRQDODSSHDUDQFHE\PHDQVRIDVLPSOH
GLVJXLVHRQFHWDXJKWPHE\DQRWKHURIP\VWXGHQWVDFHOHEUDWHGGHWHFWLYHRI
3DULV,IROORZHGWKH\RXQJODG\IRUVHYHUDOKRXUVZKHQVKHZDVRQDVKRSSLQJ
H[SHGLWLRQ0XFKWRP\VXUSULVHDQG,PD\DGGPXFKWRP\LQGLJQDWLRQ,
IRXQGWKDWDOOWKDWVKHKDGWROGPHZDVFRUUHFW,FRXOGVFDUFHO\FRQWUROP\VHOIDW
WLPHVDQGPRUHWKDQRQFHIHOWOLNHFKDVWLVLQJVRPHUXGHIHOORZZLWKP\FDQHVR
EUXWDOZDVWKHFRQGXFWRIFHUWDLQLQGLYLGXDOVFDOOLQJWKHPVHOYHVPHQ
7KHUHLVDFHUWDLQFODVVRI3DULVLDQPHQZHOOGUHVVHGDQGZLWKDYHQHHURI
SROLVKEXWERRUVDQGFXUHVDWKHDUW7KHVHPHQVHHPWRWDNHDVSHFLDOGHOLJKWLQ
MRVWOLQJ\RXQJZRPHQDOPRVWSXVKLQJWKHPRIIWKHVLGHZDONVDWWLPHVDQGLQ
RWKHUZD\VHDUQLQJDJRRGFDQLQJDWWKHKDQGVRIUHDOJHQWOHPHQ:HOOWKHVH
FXUVVHHPHGDWWUDFWHGWRWKLVVZHHW\RXQJJLUOMXVWDVIOLHVDUHGUDZQWRWDELWRI
VXJDU7KH\H[FHHGHGWKHPVHOYHVLQWKHLUGLVSOD\RIUXGHQHVVDQGFRZDUGO\
LQVROHQFHDQGDOOWKHZKLOHWKHJLUOZDVIUHHIURPDQ\RXWZDUGDSSHDUDQFHWKDW
ZRXOGDWWUDFWVXFKFXUVQDWXUDOO\,VDZDWRQFHWKDWWKHUHZDVVRPHLQQHUFDXVH
RSHUDWLQJ
0RUHRYHU,QRWLFHGWKDWWKH\RXQJZRPDQZDVDOVRSXVKHGDVLGHUXGHO\E\
KXUU\LQJEXVLQHVVSHUVRQVZKRQHYHUJODQFHGLQKHUGLUHFWLRQEXWZKRWKUXVWKHU
DVLGHDVLIVKHZHUHDQLQDQLPDWHWKLQJLQVWHDGRIDSHUVRQ$JDLQ,IRXQGDQ
LQQHUFDXVH,QWKHVDPHZD\,IRXQGWKDWVKHZDVWUHDWHGH[DFWO\LQWKHZD\VKH
KDGFRPSODLQHGRILQWKHVKRSVE\WKHFOHUNVDQGVKRSPHQDOWKRXJKVKHZDVD
OLEHUDOFXVWRPHUHDVLO\VXLWHGDQGJLYLQJEXWOLWWOHWURXEOH+HUHDJDLQWKHLQQHU
OLEHUDOFXVWRPHUHDVLO\VXLWHGDQGJLYLQJEXWOLWWOHWURXEOH+HUHDJDLQWKHLQQHU
WURXEOHZDVDSSDUHQW
,ZHQWKRPHDQGFDUHIXOO\GLDJQRVHGWKHFDVHDQGODLGGRZQDFRXUVHRU
WUHDWPHQW,VHQWIRUWKH\RXQJZRPDQDQGWROGKHUWKDWKHUWURXEOHZDVDFDVHRI
LQJURZQVHQVLWLYHQHVVDQGRYHUJURZQPRGHVW\ȈLQVKRUWWKDWVKHKDG
VXUURXQGHGKHUVHOIZLWKDQDXUDRIVHOIGHSUHFLDWLRQDQGPRUELGVHQVLWLYHQHVV
7KLVDXUDSUDFWLFDOO\LQYLWHGSHUVRQVWRSLFNRQKHUWRFURZGKHUWRWKHZDOOWR
SXVKKHULQWKHJXWWHUDQGWRJHQHUDOO\VOLJKWVQXEDQGFRYHUWO\LQVXOWKHULQWKH
VKRSV+HUDXUDZDVQRWRQO\QHJDWLYHEXWDOVRDFWXDOO\DWWUDFWLYHO\QHJDWLYHȈ
WKDWLVWRVD\VRQHJDWLYHWKDWLWDFWXDOO\DWWUDFWHGPRUHSRVLWLYHQDWXUHVLQWKH
GLUHFWLRQRILPSRVLQJRQKHUZHDNQHVV 7KLVLVIDUIURPEHLQJXQXVXDOȈLWLVD
UXOHRIWKHSV\FKLFDVZHOODVRIWKHSK\VLFDOZRUOGDPRQJDQLPDOVDVZHOODV
DPRQJPHQ
,LPPHGLDWHO\EHJDQWHDFKLQJWKLVODG\WKHWHFKQLTXHRIWKHGLUHFWIODVK
EHIRUHWKHPLUURU H[DFWO\DV,KDYHWDXJKW\RX KHUIODVKHVEHLQJLQYDULDEO\
DORQJWKHOLQHVRISRVLWLYLVPDQGVWUHQJWK6KHZRXOGIODVKRXW,DPSRVLWLYHȈ
IDUPRUHSRVLWLYHWKDQWKHFURZGDURXQGPH*HWRXWRIP\ZD\RU,ZLOOZDON
RYHU\RX&OHDUWKHSDWKIRUPH\RXYHUPLQDQGRWKHUH[DJJHUDWHGGHPDQGV
LQWHQGHGIRUWKHVWUHHWFURZGV,QWKHVDPHZD\VKHZRXOGIODVKRXWWKH
FRPPDQGWRWKHVKRSSHRSOH&RPHQRZ,GHPDQGUHVSHFWIXODWWHQWLRQ
/LYHO\QRZDWWHQGWRP\ZDQWV,DPDSULQFHVVRIWKHEORRGERZWRPH\RX
XQGHUOLQJVHWF<RXZLOOQRWHWKDW,SXUSRVHO\H[DJJHUDWHGWKHPHQWDOGHPDQGV
DQGIODVKHVEHFDXVHVKHQHHGHGDQH[DJJHUDWHGSRVLWLYHPHQWDODWWLWXGHLQRUGHU
WRRYHUFRPHKHUQDWXUDODQGDFTXLUHGKDQGLFDS,QDVKRUWWLPHVKHKDGDFTXLUHG
WKHWHFKQLTXHSHUIHFWO\DQGKDGGHYHORSHGDPHQWDODWWLWXGHDQGJHQHUDOSHUVRQDO
DWPRVSKHUHRIDSULQFHVV7KHQVKHSURFHHGHGWRWU\LWRQWKHFURZGE\PHDQV
RIWKHSRVLWLYHDXUD
7KHUHVXOWZDVPDUYHORXV)URPWKHPRPHQWKHUIHHWWRXFKHGWKHVLGHZDONV
KHUSURJUHVVZDVWKDWRIDSULQFHVVSHUVRQVLQVWLQFWLYHO\PRYHGRXWRIKHUZD\
VRPHHYHQVOLJKWO\ERZLQJDVWKH\GLGVR7KHURZG\JHQWOHPHQ " PRYHGIDU
DZD\IURPKHU$QGLQWKHVKRSVWKHTXHHQRI(QJODQGFRXOGKDYHUHFHLYHGQR
PRUHKXPEOHVHUYLFHRUFDUHIXODWWHQWLRQ7KHFXUHZDVFRPSOHWHDQGKDV
UHPDLQHGVR7KH\RXQJODG\KDVORQJVLQFHODLGDVLGHWKH3ULQFHVV5R\DO
PDQQHUDQGQRZVLPSO\PDLQWDLQVDQDXUDRISRVLWLYHVHOIUHVSHFWDQG
VHOIFRQILGHQFHDQGDGHPDQGWKDWVKHEHDFFRUGHGWKHSURSHUFRQVLGHUDWLRQ
$QRWKHUFDVHLVWKDWRID\RXQJVWXGHQWRIPLQHȈDQ$PHULFDQWKHVRQRID
SURPLQHQWEXVLQHVVPDQ7KLV\RXQJPDQZDVZHOOHGXFDWHGSROLVKHGDQG
PRUHRYHUSRVVHVVHGRIDDOOWKHUHTXLVLWHVRIDVXFFHVVIXOVDOHVPDQH[FHSWWKDW
RILQVSLULQJDIHHOLQJRIIULHQGVKLSRQWKHSDUWRIWKRVHZLWKZKRPKHFDPHLQ
FRQWDFW+HZDVFDOOHGXSRQWRDSSURDFKSURPLQHQWEXVLQHVVPHQLQFRQQHFWLRQ
FRQWDFW+HZDVFDOOHGXSRQWRDSSURDFKSURPLQHQWEXVLQHVVPHQLQFRQQHFWLRQ
ZLWKKLVZRUNIRUKLVIDWKHUDQGZKLOHKHZDVDEOHWRSUHVHQWKLVDUJXPHQWV
ORJLFDOO\DQGIRUFLEO\KHZDVQHYHUWKHOHVVKDQGLFDSSHGE\WKHIDFWWKHKH
UHSHOOHGIULHQGVKLSUDWKHUWKDQLQYLWHGLW,QGHVSHUDWLRQKHPDGHWKHWULSDFURVV
WKH$WODQWLFWRFRQVXOWPHDQGWREHJDFXUHIRUKLVVHULRXVSV\FKLFWURXEOH
+LVFXUHZDVYHU\HDV\,VLPSO\SXWKLPWKURXJKDFRXUVHRIWKHPLUURU
H[HUFLVHVLQWKHGLUHFWIODVKXQWLOKHKDGPDVWHUHGWKHWHFKQLTXHDQGWKHQKDG
KLPVDWXUDWHKLVPLQGZLWKWKHPHQWDOLPDJHDQGLGHDRI<RXOLNHPHȈ\RX
OLNHPHYHU\PXFK<RXIHHODWWUDFWHGWRZDUGPH<RXDUHP\IULHQGDQG
ZLVKWRVKRZ\RXUIULHQGVKLSIRUPHHWFHWFHWF$OOWKHVHLGHDVZHUHEXW
YDULDWLRQVRIDQLPSURYHPHQWXSRQWKHVLPSOHLGHDRI<RXOLNHPH
:HOOWKLV\RXQJPDQEHJDQWRUDGLDWHVXFKDQDWPRVSKHUHRIOLNHDELOLW\
IULHQGVKLSHWFWKDWKHPDGHIULHQGVULJKWDQGOHIWHYHQZLWKRXWW\LQJȈLWZDVLQ
WKHDLUDURXQGKLPLWVHHPHG+LVROGWURXEOHGLVDSSHDUHGOLNHPDJLFȈKHZDV
PDGHRYHULQWRDQHZPDQ$QG\HWLWZDVDOOYHU\VLPSOH\RXVHH0HUHFKLOG V
SOD\ZKHQRQHKDVWKHVHFUHWDV\RXQRZKDYH7KH\RXQJPDQLQVLVWHGXSRQ
SUHVHQWLQJPHZLWKKLVFKHFNIRUDOWKRXJK,KDGFKDUJHGKLPEXW
RQHWHQWKRIWKDWDPRXQWIRUP\WLPHDQGWURXEOH
,FRXOGJRRQLQWKLVYHLQUHFLWLQJFDVHDIWHUFDVHFRPLQJXQGHUP\RZQ
H[SHULHQFHEXW,WKLQNWKDWWKHWZRFDVHV,KDYHPHQWLRQHGZLOOJLYH\RXWKH
JHQHUDOLGHDRIZKDW,DPWU\LQJWRWHDFK\RXZLWKRXWP\WDNLQJXSPRUHWLPH
DQGVSDFHDWWKLVSRLQW7KHUXOHLVJHQHUDOȈLWLVIRU\RXWRDSSO\LWWRWKH
SDUWLFXODUUHTXLUHPHQWVRI\RXURZQFDVH)LQGRXW\RXUZHDNVSRWVRISHUVRQDO
DWPRVSKHUHDQGWKHQSURFHHGWREXLOGXSWKHRSSRVLWHTXDOLWLHVRIPLQGDQG
FKDUDFWHU)LQGRXW\RXUQHJDWLYHSRLQWVRIDWWUDFWLQJDQGWKHQSURFHHGWREXLOG
RIWKHLURSSRVLWHSRVLWLYHTXDOLWLHVMXVWDVWKHWZRVWXGHQWVMXVWPHQWLRQHGGLG
ZLWKVXFKPDUNHGVXFFHVV5HDGRYHUFDUHIXOO\WKLVFKDSWHUDJDLQDQGDJDLQ
XQWLO\RXJHWWKHSRLQWIL[HGLQ\RXUPLQG7KHUHVWLVPHUHO\DPDWWHURISUDFWLFH
&KDSWHU
7KH'LUHFW&RPPDQG
7DEOHRI&RQWHQW

+DYLQJE\WKLVWLPHDFTXLUHGWKHWHFKQLTXHRIWKHGLUHFWIODVKE\\RXU
PLUURUSUDFWLFHDQGKDYLQJDOVRPDVWHUHGWKHDUWRIFXOWLYDWLQJWKHSRVLWLYHDXUD
\RXVKRXOGEHDEOHWRPDQLIHVWZKDWLVNQRZQDVWKHGLUHFWFRPPDQGZLWKRXW
PXFKDGGLWLRQDOLQVWUXFWLRQ
%\WKHGLUHFWFRPPDQGLVPHDQWWKHIODVKLQJRIDGLUHFWFRPPDQGRU
GHPDQGWRWKHPLQGRIDQRWKHUSHUVRQEDFNHGXSE\WKHFRQFHQWUDWHGSRZHURI
ERWK\RXUPHQWDODQGSK\VLFDOPDJQHWLVP'R\RXVHHQRZZK\,KDYHILUVW
WDXJKW\RXWRDFTXLUHWKHWHFKQLTXHE\PHDQVRIWKHPLUURUSUDFWLFHDQGKDYH
WKHQQH[WWDXJKW\RXKRZWRJHQHUDWHDQGPDLQWDLQWKHSRVLWLYHDXUD"&HUWDLQO\
\RXKDYHVHHQWKHSRLQW$PRPHQW VWKRXJKWZLOOVKRZ\RXWKDWWKHGLUHFW
FRPPDQGLVUHDOO\DFRPELQDWLRQRIWKHPHWKRGVRIWKHPLUURUSUDFWLFHDQGWKDW
RIWKHSRVLWLYHDXUD7KHPLUURUSUDFWLFHWDXJKW\RXWKHWHFKQLTXHDQGWKH
SUDFWLFHDIIRUGHGE\WKHSRVLWLYHDXUDPHWKRGVKDYHVHUYHGWRJLYH\RXHDVH
VHOIFRQILGHQFHDQGDQDOPRVWLQVWLQFWLYHXVHRI\RXUPDJQHWLFSRZHUVLQWKH
GLUHFWLRQRILQIOXHQFLQJRWKHUSHUVRQV<RXZLOODOVRVHHWKHSDUWSOD\HGLQ\RXU
GHYHORSPHQWE\WKHVSHFLDOH[HUFLVHVLQWKHGLUHFWIODVKZKLFK,JDYH\RXLQD
SUHFHGLQJFKDSWHU<RXQRZEHJLQWRVHHZK\,KDYHOHG\RXWRWKHSUHVHQWSRLQW
E\GHJUHHVGR\RXQRW"
7KHGLUHFWFRPPDQGLVUHDOO\DKLJKIRUPRIWKHGLUHFWIODVKDQGLVWKH
PHWKRGZKHUHE\WKHODWWHUPD\EHXVHGWRWKHKLJKHVWGHJUHHRIHIIHFWLYHQHVV
,QWKHGLUHFWFRPPDQG\RXIODVK\RXUFRPPDQGWRWKHPLQGRIWKHRWKHU
SHUVRQPHQWDOO\RIFRXUVHEXWLQH[DFWO\WKHVDPHZD\WKDW\RXZRXOGPDNHDQ
DFWXDOFRPPDQGE\VSRNHQZRUGVLIWKHFRQGLWLRQVDGPLWWHGRIWKHVDPH<RX
IRUPWKHZRUGVRIWKHFRPPDQGLQ\RXUPLQGFDUU\LQJZLWKLWDVVWURQJDPHQWDO
SLFWXUHDV\RXFDQFUHDWHDQGWKHQPHQWDOO\IODVKWKHFRPPDQGWRWKHRWKHU
SHUVRQZLWKDVPXFKPDJQHWLFIRUFHDV\RXFDQPXVWHU
<RXZLOOILQGLWDQDLGWRHIIHFWLYHQHVVLQWKHFDVHRIDFRQWHPSODWHGGHPDQG
XSRQVRPHSDUWLFXODUSHUVRQIRUDFHUWDLQWKLQJWRSUDFWLFHLWEHIRUHWKHPLUURU
XVLQJ\RXURZQLPDJHDVDWDUJHWȈMXVWDV\RXGLGLQWKHH[HUFLVHSUHYLRXVO\
JLYHQ\RX<RXZLOOILQGWKDWDUHKHDUVDORIWKLVNLQGZLOOWHQGWRLQFUHDVH\RXU
SRZHUDWWKHWLPHRIWKHDFWXDOPDQLIHVWDWLRQRUFRPPDQG
,WLVLPSRVVLEOHWRJLYH\RXVSHFLILFLQVWUXFWLRQIRUWKHFDUU\LQJRXWRIWKLV
,WLVLPSRVVLEOHWRJLYH\RXVSHFLILFLQVWUXFWLRQIRUWKHFDUU\LQJRXWRIWKLV
SURJUDPLQVSHFLDOFDVHVIRUHDFKSHUVRQZLOOKDYHKLVRUKHURZQVSHFLDO
UHTXLUHPHQWVWKHVDPHGHSHQGLQJXSRQWKHVSHFLDOFLUFXPVWDQFHVRIWKHFDVH
$OOWKDW,FDQGRLVWRJLYH\RXWKHJHQHUDOUXOHVWR\RXURZQSDUWLFXODUFDVHVDQG
UHTXLUHPHQWV7KHJHQHUDOUXOHV,KDYHDOUHDG\JLYHQ\RX3HUKDSV,FDQLOOXVWUDWH
WKHDSSOLFDWLRQRIWKHVDPHE\FLWLQJDIHZFDVHVZKLFKKDYHDFWXDOO\FRPH
XQGHUP\RZQREVHUYDWLRQDQGH[SHULHQFH
2QHRIWKHPRVWLQWHUHVWLQJFDVHVRIWKHNLQGWKDW,KDYHHYHUPHWZLWKZDV
WKDWRIDSURIHVVRULQRQHRIWKH$PHULFDQXQLYHUVLWLHV7KLVPDQDVSHFLDOLVWLQ
KLVSDUWLFXODUOLQHRIVFLHQWLILFUHVHDUFKDQGDWKRURXJKPDVWHURIKLVRZQ
SDUWLFXODUVXEMHFWFRPPDQGHGDODUJHDXGLHQFHRIUHDGHUVRIKLVERRNVDQG
PDJD]LQHDUWLFOHVEXWDWWKHVDPHWLPHZDVDOPRVWDIDLOXUHLQKLVFODVVZRUN
RZLQJWRKLVLQDELOLW\WRJDLQDQGKROGWKHDWWHQWLRQRIKLVVWXGHQWV+HFDPHWR
PHLQ3DULVDQGH[SODLQHGKLVWURXEOH,JDYHKLPP\VKRUWFRXUVHLQPHQWDO
LQIOXHQFHHWFDQGGULOOHGKLPZHOODORQJWKHOLQHVODLGGRZQLQWKLVERRN,
PDGHKLPSUDFWLFHEHIRUHDQLPDJLQDU\URRPIXORIVWXGHQWVVHQGLQJWKHPD
VWURQJGLUHFWFRPPDQGRI*LYHPH\RXUIXOODWWHQWLRQ6WHDG\QRZ\RXU
DWWHQWLRQ\RXUIXOODQGFRPSOHWHDWWHQWLRQWRP\ZRUGVDQG7KDW VULJKW\RX
DUHJLYLQJPH\RXUIXOODWWHQWLRQQRZKROGLWILUPO\IL[HGRQPHDQGDVLPLODU
VWRFNRIGLUHFWFRPPDQGV7KHVHFRPPDQGVZHUHGLUHFWHGFRPPDQGVZHUH
GLUHFWHGILUVWWRWKHEHOOZHWKHUVRIWKHFODVVWKRVHQDWXUDOOHDGHUVZKRDUHWR
EHIRXQGLQHDFKFODVVDQGWKHQVFDWWHUHGDPRQJWKHFODVVDWODUJH7KHSURIHVVRU
WROGPHWKDWDIWHUDQXPEHURIWKHVHLPDJLQDU\FODVVURRPVFHQHVHDFKIDFH
EHLQJGLVWLQFWDQGSODLQDQGWKDWKHFRXOGDOPRVWVHHWKHIODVKRIKLVFRPPDQG
UHDFKLQJWKHP
:KHQ,WKRXJKWWKDWKHKDGPDVWHUHGWKHJHQHUDOSULQFLSOHVDQGDFTXLUHGWKH
WHFKQLTXH,GLVPLVVHGKLPDQGKHUHWXUQHGDWRQFHWRWKHXQLYHUVLW\LQ$PHULFD
,UHFHLYHGVHYHUDOOHWWHUVIURPKLPGXULQJWKHIROORZLQJ\HDUDQGKHWHVWLILHGWR
WKHFRPSOHWHVXFFHVVRIWKHSODQZKHQSXWLQWRDFWXDOHIIHFW)URPWKHILUVWGD\
RIKLVUHWXUQKHREWDLQHGDQGKHOGWKHDWWHQWLRQRIKLVFODVVDQGWRGD\KHLVRQH
RIWKHEHVWSHUVRQDOLQVWUXFWRUVLQKLVXQLYHUVLW\RUHOVHZKHUHIRUWKDWPDWWHU,Q
WKLVFDVHKHDSSOLHGWKHGLUHFWFRPPDQGWRVSHFLDOLQGLYLGXDOVRIWKHFODVVEXW
WKHSULQFLSOHZDVWKHVDPHDVLQWKHFDVHRIDVLQJOHVSHFLDOLQGLYLGXDODQG
GLIIHUHGIURPWKHSRVLWLYHDXUDPHWKRG
$QRWKHUFDVHZDVWKDWRIDSURPRWHUQRZRILQWHUQDWLRQDOUHSXWDWLRQZKR
IRUPHUO\ZDVXQDEOHWRFORVHPDQ\RIKLVSODQVRZLQJWRDODFNRIVRPHWKLQJ
LQKLVPHQWDOPDNHXSKHWKRXJKW+HFRXOGHYROYHSODQVZKLFKDWWUDFWHGWKH
DWWHQWLRQRISURPLQHQWPHQDQGRWKHUVDQGKHFRXOGDOVRPDQDJHWRIDVFLQDWH
WKHPE\KLVJHQHUDOWDONUHJDUGLQJKLHQWHUSULVHV%XWKHIRXQGLWPRVWGLIILFXOW
WRLQGXFHWKHPWRWDNHWKHILQDOVWHSRFRPLQJLQRUVLJQLQJWKHFRQWUDFWRU
HQWHULQJWKHVXEVFULSWLRQDVWKHFDVHPLJKWEH
HQWHULQJWKHVXEVFULSWLRQDVWKHFDVHPLJKWEH
,ODERUHGZLWKWKLVPDQH[SHULHQFLQJPXFKWURXEOHLQRYHUFRPLQJKLVIL[HG
DQGVWXEERUQLGHDWKDWWKHUHZDVVRPHWKLQJZURQJZLWKKLVPHQWDOPDNHXS
)LQDOO\DIWHUDORQJSHULRGRIFDUHIXOGULOOLQJEHIRUHDQLPDJLQDU\SURVSHFW
WKLVWHUPEHLQJDSSOLHGWRSURVSHFWLYHFXVWRPHUV KHEHJDQWRIHHOWKDWKHKDG
WKHPLVVLQJHOHPHQWDIWHUDOO)URPWKDWPRPHQWKHZDVILOOHGZLWKQHZFRXUDJH
DQGWKUHZQHZOLIHDQGHQHUJ\LQWRWKHH[HUFLVHV6RSRZHUIXOO\PDJQHWLFZDV
WKLVPDQDQGVRKLJKDGHJUHHRIFRQFHQWUDWHGIRUFHGLGHKJHQHUDWHWKDW,FRXOG
DFWXDOO\IHHOWKHIRUFHRIKLVSRZHUZKLOHSUHVHQWLQWKHURRPGLUHFWLQJWKH
H[HUFLVHV,DFWXDOO\P\VHOIIHOWOLNHVXEVFULELQJWRVRPHRIKLVVWRFNDQGDP
VXUHWKDWKDGKHDSSURDFKHGPHRQWKHVXEMHFWLWZRXOGKDYHUHTXLUHGWKH
H[HUFLVHRIP\IXOOSRZHURIVHOISURWHFWLRQDQGUHVLVWDQFHWRKDYHRYHUFRPHKLV
PDJQHWLVP
:KHQWKLVPDQILQLVKHGKLVLQVWUXFWLRQDWP\KDQGVKHDWRQFHSOXQJHGLQWR
WKHIORDWLQJRIDQHZJUHDWHQWHUSULVHDQGFDUULHGWKHVDPHWRDPRVWVXFFHVVIXO
FRQFOXVLRQ+HFORVHGQHDUO\HYHU\SURVSHFWWKDWKHDSSURDFKHGDQGVRRQ
GURSSHGDOOWKHVPDOOHUSURVSHFWVDQGGHYRWHGKLVHQWLUHDWWHQWLRQWRWKHODUJH
ILVK,GRQRWIHHODWOLEHUW\WRVWDWHKHUHWKHH[DFWZRUGVRIWKHGLUHFW
FRPPDQGXVHGE\KLPIRUKHSDLGPHDODUJHIHHIRUP\VHUYLFHVDQGWKH
VHFUHWVKRXOGEHKLVRZQXQGHUWKHFLUFXPVWDQFHVEXWWKLV,ZLOOVD\WKDWKLV
GLUHFWFRPPDQGZDVDVWUDLJKWRXWIURPWKHVKRXOGHUPHQWDO'(0$1'XSRQWKH
SURVSHFWWRFRPHLQ
$QRWKHULQWHUHVWLQJFDVHZDVWKDWRIDQRZZHOONQRZQDFWUHVVZKRODFNHG
IDVFLQDWLRQ6KHZDVDPDJQLILFHQWDFWUHVVRIILQHSUHVHQFHDQGDWKRURXJK
NQRZOHGJHRIKHUDUWEXWIRUVRPHUHDVRQKHUDFWLQJVHHPHGWRODFNVRXO6KH
FDPHWRPHWROHDUQKRZWRLQIOXHQFHKHUDXGLHQFHE\SHUVRQDOPDJQHWLVPEXW,
VDZDWRQFHWKDWKHUDUWLIIXOO\H[HUFLVHGZRXOGEHVXIILFLHQWWRFDUU\KHU
DXGLHQFHVZLWKKHU+HUWURXEOHOD\LQWKHIDFWWKDWWKHUHZDVDFHUWDLQ
IDVFLQDWLRQODFNLQJ,VHWKHUWRZRUNWUDLQLQJKHUVRWKDWVKHZRXOGDFWXDOO\
IDVFLQDWHWKHDFWRUVSOD\LQJZLWKKHUDQGDQDLURIUHDOLW\ZRXOGEHWKXVFUHDWHG
6KHSURJUHVVHGUDSLGO\VRTXLFNZHUHKHUSHUFHSWLRQV:KHQVKHOHIWPHVKH
ZDVDEOHWRWKURZVXFKDGHJUHHRIIDVFLQDWLRQLQWRKHUYRLFHDQGPDQQHUWKDW
WKHDFWRUSOD\LQJZLWKKHUZRXOGEHIDLUO\VZHSWRIIKLVIHHWWKHUHVXOWEHLQJWKDW
WKHDXGLHQFHZRXOGFDWFKWKHVDPHE\DNLQGRIPHQWDOFRQWDJLRQ6KHVLPSO\
KXUOHGPHQWDOGLUHFWFRPPDQGVDWWKHDFWRUVZKLOHUHFLWLQJKHUOLQHVDQGZKLOH
DSSURDFKLQJWKHP+HUVXFFHVVLVQRZDVVXUHGEXW,FDQQRWUHVLVWWKHWHPSWDWLRQ
RIPHQWLRQLQJWKDWVKHKDVKDGWKHJUHDWHVWWURXEOHZLWKKHUOHDGLQJPHQLQKHU
FRPSDQLHVWKH\DOOLQVLVWDQGSHUVLVWLQIDOOLQJLQORYHZLWKKHUDQGVKHKDVKDG
WRFKDQJHWKHPIUHTXHQWO\WRJHWULGRIWKHLUXQZHOFRPHDWWHQWLRQVIRUKHUKHDUW
LVWDNHQHOVHZKHUH
LVWDNHQHOVHZKHUH
,IHOOWKDW,DPMXVWLILHGLQFDOOLQJWKHDWWHQWLRQWRDQRWKHUFDVHWKDWRID
OHDGLQJVWDWHVPDQZKRWRRNP\LQVWUXFWLRQVE\PHDQVRIDVHULHVRIOHWWHUV
VHYHUDO\HDUVDJR7KLVPDQZDQWHG0$67(5<+HJRWLW,JDYHKLPWKHFXH
DQGNH\QRWHDQGKHGLGWKHUHVW6RPDVWHUIXOGLGKHEHFRPHE\WKH
HPSOR\PHQWRIP\VXJJHVWHGGLUHFWFRPPDQGVWKDWKHGRPLQDWHGDOOZKRFDPH
QHDUKLP,QIDFWKHFDUULHGWKHWKLQJDOLWWOHWRRIDUKHJUHZWREHUHJDUGHGDV
GDQJHURXVDQGW\UDQQLFDODQGSRZHUIXOLQWHUHVWVFRQVSLUHGDJDLQVWKLP+HLVLQ
WHPSRUDU\UHWLUHPHQWDWWKLVWLPHEXWKHLVUHDOO\EXWELGLQJKLVWLPH,WLV
LPSRVVLEOHWRUHPDLQLQWKLVPDQ VSUHVHQFHIRUDQ\WLPHSDUWLFXODUO\LIKLV
DWWHQWLRQLVGLUHFWHGWRZDUG\RXZLWKRXWDFNQRZOHGJLQJKLPWREHD0$67(5
,QRZDVN\RXUHIHUWRWKHODVWSDJHVRIWKHFKDSWHURQWKHGLUHFWIODVK<RX
ZLOOILQGWKHUHDQXPEHURIVHQWHQFHVJLYHQDVSUDFWLFHVEHIRUHWKHPLUURU6WXG\
RYHUWKHVHVHQWHQFHVFDUHIXOO\DQG\RXZLOOILQGWKHUHLQDVWURQJKLQWRIWKHLGHD
ZKLFK\RXVKRXOGZHDYHLQWR\RXURZQGLUHFWFRPPDQGV6WXGHQWVRIPLQG
XQGHUP\GLUHFWLRQKDYHHIIHFWLYHO\HPSOR\HGDOORIWKHVHVHQWHQFHVLQDFWXDO
SUDFWLFHDQGDOORIWKHPKDYHWKHJHUPRIVXFFHVVLQWKHP<RXPD\XVHWKHP
VLQJO\LQFRPELQDWLRQRUDVDJHQHUDOSDWWHUQDURXQGZKLFK\RXPD\ZHDYH
\RXURZQLGHDV3UDFWLFHHDFKRIWKHPXQWLO\RXFDWFKWKHVSLULWDQG\RXZLOO
WKHQKDYHQRWURXEOHLQFUHDWLQJ\RXURZQFRPPDQGVLQWKHPRVWDSSURYHGVW\OH
<RXZLOOQRWLFHWKH',5(&71(66DQG326,7,9(1(66RIHDFKRIWKHVH
FRPPDQGVWKHVHDUHWKHWZRHVVHQWLDOTXDOLWLHVWREHREVHUYHGDQGXVHGLQWKLV
ZRUNRIWKHGLUHFWFRPPDQG3XWDOO\RXUPDJQHWLFIRUFHEHKLQGWKHPDQGIODVK
WKHPRXWULJKWWRWKHSRLQWVTXDUHO\LQWRWKHPHQWDOLW\RIWKHSHUVRQVZKRP\RX
ZLVKWRLQIOXHQFH
&KDSWHU
7KH0DJQHWLF'XHO
7DEOHRI&RQWHQW

7KHODZVRISHUVRQDOPDJQHWLVPDUHLQDFFRUGZLWKWKHRWKHUODZVRIQDWXUHLQ
UHFRJQL]LQJWKHXQLYHUVDOIDFWWKDWWKHUHDUHYDULRXVGHJUHHVRISRZHUDQGWKDW
DOOHOVHEHLQJHTXDOWKHVWURQJHUSRZHUZLOOSUHYDLORYHUWKHZHDNHU%XWLWLV
OLNHZLVHWUXHWKDWWKHLQGLYLGXDOE\DVXSHULRUNQRZOHGJHRIWKHDUWRIVFLHQFHRI
GHIHQVHDQGRIIHQVHPD\RIWHQWULXPSKRYHUDVXSHULRUGHJUHHRIVWUHQJWKLQWKH
RWKHUSHUVRQ7KLVIDFWLVDVWUXHRISHUVRQDOPDJQHWLVPDVLWLVRISK\VLFDO
VWUHQJWK7KHVNLOOHGPDJQHWLFLQGLYLGXDOPD\RYHUFRPHKLVVWURQJHUDGYHUVDU\
MXVWDVWKHVNLOOHGER[HUPD\RYHUFRPHDVWURQJHUPDQRUDVNLOOHGIHQFHUPD\
GLVDUPDQGGHIHDWDPXFKVWURQJHURSSRQHQW
7KHFRQIOLFWEHWZHHQWKHRSSRVLQJPDJQHWLVPRILQGLYLGXDOVLVWREHVHHQRQ
DOOKDQGVHYHU\GD\,QIDFWLWKDVEHHQZHOOVDLGWKDWWZRSHUVRQVQHYHUPHHWEXW
WKDWWKHUHLVDWOHDVWDSUHOLPLQDU\WULDORIPDJQHWLFVWUHQJWK$WDQ\UDWHQRWZR
SHUVRQVHYHUPHHWZKRVHLQWHUHVWVDUHLQWKHOHDVWRSSRVHGEXWWKDWWKHUHRFFXUV
DOLWWOHWLOWRIPDJQHWLFVWUHQJWKȈVRPHWLPHVDTXLWHVWUHQXRXVWHVWLQIDFW$QG
LQWKHVHWHVWVWKHUHDOZD\VLVRQHWULXPSKDQWDQGRQHGHIHDWHG,WLVWUXHWKDWWKH
FLUFXPVWDQFHVRIWKHFDVHVRPHWLPHVDIIHFWWKHUHVXOWDQGWKHGHIHDWHGWRGD\
PD\EHWKHYLFWRUWRPRUURZEXWWKHIDFWUHPDLQVWKDWIRUWKHWLPHEHLQJDW
OHDVWWKHUHLVDOZD\VRQHRQWRSDQGWKHRWKHUXQGHUQHDWKDWWKHILQLVKRIWKH
PDJQHWLFGXHOEHLWVOLJKWRUVHULRXV2QHKDVEXWWRUHFDOOLQFLGHQWVLQWKHLURZQ
H[SHULHQFHWRUHFRJQL]HWKLVIDFW
2OLYHU:HQGHOO+ROPHVUHFRJQL]HGWKLVPDJQHWLFGXHOLQRQHRIKLVERRNV
ZKHQKHVSHDNVRIWKDWGHDGO\,QGLDQKXJLQZKLFKPHQZUHVWOHZLWKWKHLUH\HV
RYHULQILYHVHFRQGVEXWZKLFKEUHDNVRQHRIWKHLUWZREDFNVDQGLVJRRGIRU
WKUHHVFRUH\HDUVDQGWHQRQHWULDOHQRXJKȈVHWWOHVWKHZKROHPDWWHUȈMXVWDV
ZKHQWZRIHDWKHUHGVRQJVWHUVRIWKHEDUQ\DUGJDPHDQGGXQJKLOOFRPH
WRJHWKHU$IWHUDMXPSRUWZRDQGDIHZVKDUSNLFNVWKHUHLVDQHQGRILWDQGLW
LV $IWHU\RXPRQVLHXU ZLWKWKHEHDWHQSDUW\LQDOOWKHVRFLDOUHODWLRQVIRUDOOWKH
UHVWRIKLVGD\V
'U)RWKHUJLOODZHOONQRZQ(QJOLVK3K\VLFLDQQRZGHFHDVHGRQFHZURWHD
OLWWOHERRNXSRQWKHVXEMHFWRIWKHZLOO7KHJRRGGRFWRUZDVDFORVHVWXGHQWRI
SHUVRQDOPDJQHWLVPDOWKRXJKKHGLGQRWFKRRVHWRXVHWKHWHUPLWVHOILQKLV
ZULWLQJVEHFDXVHRIWKHQDUURZFRGHRISURIHVVLRQDOHWKLFVWKHQLPSRVHGXSRQ
ZULWLQJVEHFDXVHRIWKHQDUURZFRGHRISURIHVVLRQDOHWKLFVWKHQLPSRVHGXSRQ
WKHPHGLFDOSURIHVVLRQLQ*UHDW%ULWDLQ,KDYHSHUVRQDOPDJQHWLVPLQWKHRU\
DQGSUDFWLFH,WKHUHIRUHWDNHJUHDWSOHDVXUHLQTXRWLQJIURPKLPRQWKHSDUWLFXODU
VXEMHFWQRZEHIRUHXVDVIROORZV
7KHFRQIOLFWRIZLOOWKHSRZHUWRFRPPDQGRWKHUVKDVEHHQVSRNHQRI
IUHTXHQWO\<HWZKDWLVWKLVZLOOSRZHUZKLFKLQIOXHQFHVRWKHUV":KDWLVLWWKDW
PDNHVXVDFFHSWDQGDGRSWWRRWKHDGYLFHRIRQHSHUVRQZKLOHSUHFLVHO\WKH
VDPHDGYLFHIURPDQRWKHUKDVEHHQUHMHFWHG",VLWWKHZHLJKWRUIRUFHRIZLOO
ZKLFKLQVHQVLEO\LQIOXHQFHVXVWKHIRUFHRIZLOOEHKLQGWKHDGYLFH"7KDWLVZKDW
LWLV7KHSHUVRQZKRWKXVIRUFHVKLVRUKHUDGYLFHXSRQXVKDVQRPRUHSRZHUWR
HQIRUFHLWWKDQRWKHUVEXWDOOWKHVDPHZHGRDVUHTXHVWHG:HDFFHSWIURPRQH
ZKDWZHUHMHFWIURPDQRWKHU2QHSHUVRQVD\VRIVRPHWKLQJFRQWHPSODWHG 2K
EXW\RXPXVWQRW \HWZHGRLWDOOWKHVDPHWKRXJKWKDWSHUVRQPD\EHLQD
SRVLWLRQWRPDNHXVUHJUHWWKHUHMHFWLRQRIWKDWFRXQVHO$QRWKHUSHUVRQVD\V
2KEXW\RXPXVWQ W DQGZHGHVLVWWKRXJKZHPD\LIVRGLVSRVHGVHWWKLVODWWHU
SHUVRQ VRSLQLRQWGHILDQFHZLWKLPSXQLW\,WLVQRWWKHIHDURIFRQVHTXHQFHVQRU
RIJLYLQJRIIHQFHZKLFKGHWHUPLQHVWKHDGRSWLRQRIWKHODWWHUSHUVRQ VDGYLFH
ZKLOHLWKDVEHHQUHMHFWHGZKHQJLYHQE\WKHILUVW,WGHSHQGVXSRQWKHFKDUDFWHU
RUZLOOSRZHURIWKHLQGLYLGXDODGYLVLQJZKHWKHUZHDFFHSWWKHDGYLFHRUUHMHFW
LW7KLVFKDUDFWHURIWHQGHSHQGVOLWWOHLIDWDOOLQVRPHFDVHVXSRQWKHLQWHOOHFW
RUHYHQRQWKHPRUDOTXDOLWLHVWKHJRRGQHVVRUEDGQHVVRIWKHLQGLYLGXDO,WLV
LWVHOIDQLPSRQGHUDEOHVRPHWKLQJ\HWLWFDUULHVZHLJKWZLWKLW
7KHUHPD\EHDEOHUPHQFOHYHUHUPHQEXWLWLVWKHRQHSRVVHVVHGRIZLOO
ZKRULVHVWRWKHVXUIDFHDWWKHVHWLPHVȈWKHRQHZKRFDQE\VRPHVXEWOHSRZHU
PDNHRWKHUPHQREH\KLP
7KHZLOOVWUXJJOHJRHVRQXQLYHUVDOO\,QWKH\RXQJDULVWRFUDWZKRJHWVKLV
WDLORUWRPDNHDQRWKHUDGYDQFHLQGHILDQFHRIKLVFRQYLFWLRQWKDWKHZLOOQHYHU
JHWKLVPRQH\EDFN",WJRHVRQEHWZHHQODZ\HUDQGFOLHQWEHWZL[WGRFWRUDQG
SDWLHQWEHWZHHQEDQNHUDQGERUURZHUEHWZL[WEX\HUDQGVHOOHU,WLVQRWWDFW
ZKLFKHQDEOHVWKHSHUVRQEHKLQGWKHFRXQWHUWRLQGXFHFXVWRPHUVWREX\ZKDW
WKH\GLGQRWLQWHQGWREX\DQGZKLFKZKHQERXJKWJLYHVWKHPQRVDWLVIDFWLRQ
WKRXJKLWLVOLQNHGWKHUHZLWKIRUWKHHIIRUWWREHVXFFHVVIXO
:KHQHYHUWZRSHUVRQVPHHWLQEXVLQHVVRULQDQ\RWKHUUHODWLRQLQOLIHXSWR
ORYHPDNLQJWKHUHLVWKLVZLOOILJKWJRLQJRQFRPPRQO\HQRXJKZLWKRXWDQ\
FRQVFLRXVQHVVRIWKHVWUXJJOH7KHUHLVDGLPFRQVFLRXVQHVVRIWKHUHVXOWEXW
QRQHRIWKHSURFHVVHV,WRIWHQWDNHV\HDUVRIWKHLQWLPDF\RIPDUULHGOLIHWRILQG
RXWZLWKZKRPRIWKHSDLUWKHPDVWHU\UHDOO\OD\V2IWHQWKHIDUVWURQJHU
FKDUDFWHUWRDOODSSHDUDQFHVKDVWR\LHOGLWLVWKLVZLOOHOHPHQWZKLFKXQGHUOLHV
WKHVWDWHPHQW 7KHUDFHLVQRWDOZD\VWRWKHVZLIWQRUWKHEDWWOHWRWKHVWURQJ ,Q
0LGGOHPDUFK ZHILQGLQ/\GJDWHDJUDQGDJJUHJDWLRQRITXDOLWLHV\HWVKDOORZ
KDUGVHOILVK5RVDPRQGPDVWHUVKLPWKRURXJKO\LQWKHHQG+HZDVQRWGHILFLHQW
KDUGVHOILVK5RVDPRQGPDVWHUVKLPWKRURXJKO\LQWKHHQG+HZDVQRWGHILFLHQW
LQZLOOSRZHUSRVVHVVHGPRUHWKDQDQDYHUDJHVKDUHRIFKDUDFWHUEXWLQWKHILJKW
KHZHQWGRZQDWODVWXQGHUWKHRQVODXJKWRIWKHLQWHQVHVWXEERUQZLOORIKLV
QDUURZPLQGHGVSRXVH7KHLUZLOOFRQWHVWZDVWKHFROOLVLRQRIDODUJHZDUP
QDWXUHOLNHDFDSDEOHKXPDQKDQGZLWKDKDUGQDUURZVHOILVKQDWXUHOLNHD
VWHHOEXWWRQWKHKDQGRQO\EUXLVHGLWVHOIZKLOHWKHEXWWRQUHPDLQHGXQDIIHFWHG
,I\RXZLOOVXEVWLWXWHWKHWHUPPDJQHWLFIRUFHIRUZLOOZLOOSRZHUHWF
LQWKHJRRGGRFWRU VZRUGV\RXZLOOVHHKRZSHUIHFWO\KHZDVLQDFFRUGZLWKWKH
WHDFKLQJVFRQWDLQHGLQWKLVERRN
7KHVWXGHQWZKRKDVFDUHIXOO\VWXGLHGWKHIRUHJRLQJSDJHVZLOOKDYHDFTXLUHG
VXIILFLHQWNQRZOHGJHRIWKHWKHRU\DQGSUDFWLFHWKHPHWKRGDQGWKHWHFKQLTXHRI
SHUVRQDOPDJQHWLVPWREHDEOHWRFDUU\KLPVHOIRUKHUVHOIWKRXJKDPDJQHWLF
GXHOZLWKFUHGLWWRKLPVHOIRUKHUVHOIDQGFUHGLWWRP\VHOIWKHWHDFKHU%XW
UHPHPEHUWKDWWKHUHLVDVPXFKLQDGURLWQHVVDQGVNLOODVWKHUHLVLQPHUH
VWUHQJWKRIPDJQHWLVP&DUU\LQPLQGWKHWDFWLFVRIWKHJRRGER[HURUJRRG
IHQFHUȈWU\WRUHSURGXFH LQWKHPDJQHWLFGXHO WKHJXDUGVWKHIHLQWVWKH
XQH[SHFWHGVWURNHWKHUXVKHVWKHRYHUSRZHULQJVWURNHHWF,WZLOOQRWKXUW\RX
WRSXUSRVHO\HQJDJHLQVRPHRIWKHVHFRQIOLFWVDVJRRGSUDFWLFHSUHSDULQJIRUWKH
GD\RIDUHDOWHVWRISRZHURQVRPHLPSRUWDQWSRLQW$VVHUW\RXUZLOODOLWWOHDQG
VWULYHWRKDYH\RXURZQZD\LQVPDOOPDWWHUVSDUWLFXODUO\LI\RXDUHRSSRVHG
WKHUHLQE\RWKHUV7KHVNLOODQGSUDFWLFHWRJHWKHUZLWKWKHVHOIFRQILGHQFH\RX
ZLOOJDLQZLOOSURYHXVHIXOWR\RXLQWKHKRXURUQHHG
,QDGGLWLRQWRWKHJHQHUDODQGVSHFLDOLQVWUXFWLRQUHJDUGLQJWKHXVHRISRVLWLYH
PDJQHWLVPLQUHODWLRQWRRWKHUSHUVRQV,QRZRIIHUIRU\RXUFRQVLGHUDWLRQWKH
IROORZLQJVSHFLDOIODVKHVIRUXVHRQVSHFLDORFFDVLRQVHVSHFLDOO\LQFDVHVRI
WKHPDJQHWLFGXHO<RXZLOOILQGWKHVHIODVKHVRIJUHDWXVHWR\RXRQVXFK
RFFDVLRQVSDUWLFXODUO\ DVLVJHQHUDOO\WKHFDVH ZKHUHWKHRSSRQHQWGRHVQRW
NQRZWKHVHFUHWRIKLVRZQQDWXUDOSRZHURIPDJQHWLVPDQGLVQRWYHUVHGLQWKH
DUWDQGVFLHQFHRIXVLQJLW6WXG\RYHUWKHVHFDUHIXOO\ȈIRUWKH\DUHYDOXDEOHDQG
UHSUHVHQWWKHUHVXOWRI\HDUVRIH[SHULHQFHDQGSUDFWLFH+HUHIROORZVWKHOLVWMXVW
VSRNHQRI0\PDJQHWLVPLVVWURQJHUWKDQ\RXUVȈLWLVRYHUSRZHULQJ\RX
0\PDJQHWLVPLVEHDWLQJGRZQ\RXUJXDUGȈ\RXDUHZHDNHQLQJ
,DPPRUHSRVLWLYHWKDQ\RXȈ\RXDUHQHJDWLYHDQGDUHEHJLQQLQJWRUHWUHDW
DQGJLYHLQWRPH
<RXDUHEHJLQQLQJWRIHHODIUDLGRIPHDIUDLGDIUDLGDIUDLGRIPH
5HWUHDWUHWUHDWUHWUHDW,WHOO\RXȈ,DPIRUFLQJ\RXEDFNZDUG
,DPVFDWWHULQJ\RXUIRUFHVȈ,DPGLVVLSDWLQJ\RXUHQHUJ\Ȉ,DPEUHDNLQJ
\RXUPDJQHWLVPWRELWVE\WKHSRZHURIP\RZQIRUFH
,DPVWDQGLQJRQWKHVROLGURFNRISRZHUȈ\RXUIHHWDUHRQVDQGDQGDUH
VOLSSLQJZD\IURP\RX
VOLSSLQJZD\IURP\RX
*(72872)0<:$<Ȉ,&200$1'<2872*(7287
,DPFURZGLQJ\RXEDFNRII\RXUIHHWPRYHEDFN,WHOO\RX%$&.RXW
RIP\ZD\,WHOO\RX
<RXPD\JHWWKHVSLULWRIWKHDERYHE\FDUHIXOO\UHDGLQJWKHPUHSHDWLQJ
WKHPWR\RXULPDJHLQWKHPLUURUWKURZLQJIXOOIRUHLQWRWKHZRUGVDQGWKH
H[SUHVVLRQLQWR\RXUH\HV7KHQ\RXZLOOEHDEOHWRIODVKWKHPRXWWRRWKHUV
ZKHQWKHRFFDVLRQDULVHVZLWKHDVHSRZHUDQGHIIHFW<RXQHHGQRWEHERXQGE\
WKHSUHFLVHZRUGVWKDW,KDYHJLYHQ\RXSURYLGLQJ\RXFDWFKWKHVSLULWEHKLQG
WKHP<RXPD\XVH\RXURZQZRUGVȈWKHYHU\ZRUGVWKDW\RXZRXOGOLNHWR
DFWXDOO\XWWHUWRWKHRWKHUSHUVRQLI\RXSUHIHU7KHWKLQJWRGRLVWRJHWWKH
IHHOLQJDQGPHDQLQJLQWRKLVPLQG
,QDVXFFHHGLQJFKDSWHUHQWLWOHG0DJQHWLF6HOI'HIHQVH\RXZLOOILQGIXOO
LQVWUXFWLRQIRUGHIHQVLYHIODVKHVDQGJXDUGVZKLFKDUHWREHXVHGLQ
FRQQHFWLRQZLWKWKHDERYHRIIHQVLYHRQHVLQWKHPDJQHWLFGXHO%HDWWKH
RSSRQHQWRIIE\QHXWUDOL]LQJKLVPDJQHWLVPDFFRUGLQJWRWKHDGYLFHJLYHQLQWKH
QH[WFKDSWHUDQGWKHQSOXQJHLQ\RXURZQPHQWDOZHDSRQVRIDWWDFN7KH
IROORZLQJFRQVWLWXWHVDEURDGVZRUGPHQWDOZHDSRQZKLFKPD\RIWHQEHXVHG
ZLWKWKHJUHDWHVWHIIHFW
,DPSRXULQJLQWR\RXDVWURQJFRQFHQWUDWHGFXUUHQWRIPDJQHWLFSRZHU
:KLFKLVRYHUSRZHULQJ\RXDQGFRQTXHULQJ\RXDQGEHQGLQJ\RXWRP\ZLOO
0\PDJQHWLVPLVIDUVWURQJHUWKDQLV\RXUVDQG,NQRZKRZWRXVHLWWREHWWHU
DGYDQWDJHWKDQGR\RX,DPRYHUSRZHULQJ\RXȈ,DPFRQTXHULQJ\RXȈ,DP
EHQGLQJ\RXWRP\ZLOO,DP0$67(5,1*\RXVWHDGLO\DQGFRPSOHWHO\,VKDOO
FRPPDQG\RXWRGRDV,ZLOO<RX0867GRLWDQGGRLWQRZ6XUUHQGHU,WHOO
\RXȈVXUUHQGHUQRZȈ6855(1'(5WRPHDWRQFH<RX0867DQG\RX
6+$//,DPEUHDNLQJGRZQ\RXUUHVLVWDQFH<RXDUHJLYLQJXSȈ
6855(1'(512:Ȉ6855(1'(5$721&(
&KDSWHU
&RUSRUHDO0DJQHWLVP
7DEOHRI&RQWHQW

%HIRUHFRQFOXGLQJP\LQVWUXFWLRQUHJDUGLQJWKHVXEMHFWRIWKHSURMHFWLRQRI
SHUVRQDOPDJQHWLVP,ZLVKWRKDYHDIHZZRUGVZLWK\RXRQWKHVXEMHFWRIZKDW
PD\EHFDOOHGFRUSRUHDOPDJQHWLVP%\FRUSRUHDO LVPHDQWSHUWDLQLQJWRWKH
ERG\,XVHWKHWHUPFRUSRUHDOPDJQHWLVPWRLQGLFDWHDQGGHVLJQDWHWKH
FRQYH\DQFHRISHUVRQDOPDJQHWLVPE\PHDQVRISK\VLFDOFRQWDFWDVIRU
LQVWDQFHE\WKHWRXFKRIWKHKDQGVOLSVHWF
,WPD\EHREMHFWHGWRWKDWWKLVWHUPLVQHHGOHVVLQDVPXFKDV,KDYHDOUHDG\
FRQVLGHUHGWKHSKDVHRISK\VLFDOPDJQHWLVPRUQHUYHIRUFHLQFRQQHFWLRQZLWK
WKHJHQHUDOVXEMHFWRISHUVRQDOPDJQHWLVP%XW,DQVZHUE\FRUSRUHDO
PDJQHWLVP,PHDQVRPHWKLQJGLIIHUHQWIURPPHUHSK\VLFDOPDJQHWLVPRU
QHUYHIRUFH7KHQHZWHUPLVIDUPRUHLQFOXVLYHIRUE\FRUSRUHDOPDJQHWLVP,
PHDQWKHSURMHFWLRQRIWKHFRPELQHGSHUVRQDOPDJQHWLVP SK\VLFDODQGPHQWDO
WRWKHRWKHUSHUVRQRYHUWKHFKDQQHOVRIWKHQHUYRXVV\VWHPRIERWKSHUVRQV
LQVWHDGRIWKURXJKWKHHWKHUDVLQWKHFDVHRIWKHRUGLQDU\SURMHFWLRQRISHUVRQDO
PDJQHWLVP1RWHWKLVGLVWLQFWLRQ8QGHUWKHKHDGRISK\VLFDOPDJQHWLVP,
H[SODLQHGWR\RXKRZPDJQHWLFKHDOLQJWUHDWPHQWVPLJKWEHJLYHQE\WKHXVHRI
WKHKDQGVWKHSK\VLFDOPDJQHWLVPSDVVLQJRYHUWKHQHUYRXVV\VWHPRIWKHKHDOHU
PDNLQJWKHOHDSEHWZHHQWKHILQJHUWLSVDQGWKHERG\RIWKHRWKHUSHUVRQ%XWLQ
FRUSRUHDOPDJQHWLVPQRWRQO\WKHSK\VLFDOPDJQHWLVPRUQHUYHIRUFHLVVR
SURMHFWHGWRWKHRWKHUSHUVRQEXWDWWKHVDPHWLPHLVDOVRSURMHFWHGWKHPHQWDO
PDJQHWLVP,QVKRUWWKHHQWLUHSURFHVVRIWKHSURMHFWLRQRIFRPELQHGSHUVRQDO
PDJQHWLVPLVSHUIRUPHGEXWWKHPDJQHWLVPIORZVDORQJSK\VLFDOFKDQQHOV
LQVWHDGRIDFURVVWKHHWKHUWRUHDFKWKHRWKHUSHUVRQ,WUXVWWKDW\RXFOHDUO\
SHUFHLYHWKLVGLVWLQFWLRQEHIRUHZHSURFHHGIXUWKHU
7KDWWKHUHH[LVWVWKLVSKDVHRISHUVRQDOPDJQHWLVPFDOOHGFRUSRUDO
PDJQHWLVPFDQQRWEHGRXEWHGE\WKHFDUHIXOLQYHVWLJDWRU2QDOOVLGHVZHPD\
VHHHYLGHQFHRIWKHSKHQRPHQDRIWKLVSKDVHRISHUVRQDOPDJQHWLVP,QWKH
KDQGVKDNHRIWKHSHUVRQLVRIWHQFRQYH\HGWKHVWURQJHVWNLQGRISHUVRQDO
PDJQHWLVPȈLQWKHWRXFKRIWKHKDQGLVRIWHQIRXQGWKHVWURQJHVWNLQGRI
HPRWLRQDOYLEUDWLRQV,QWKHNLVVDQGWKHFRQWDFWRIWKHFKHHNDUHRIWHQWREH
IRXQGWKHPRVWDFWLYHIRUPRIHPRWLRQDOYLEUDWLRQVDVDOPRVWHYHU\RQHNQRZV
,QVKRUWE\ERGLO\FRQWDFWWKHUHPD\RIWHQEHFRQYH\HGWKHPRVWGDQJHURXV
,QVKRUWE\ERGLO\FRQWDFWWKHUHPD\RIWHQEHFRQYH\HGWKHPRVWGDQJHURXV
IRUPVRIVH[XDOPDJQHWLVPȈDQGRWKHUIRUPVRIPDJQHWLVP
,GRQRWLQWHQGWRVD\PXFKUHJDUGLQJVH[XDOPDJQHWLVPLQWKLVERRNEXW,
ZRXOGQRWEHGRLQJMXVWLFHWRP\VWXGHQWVLI,IDLOHGWRDWOHDVWPHQWLRQVRPH
SODLQIDFWVLQSDVVLQJ,QHHGVFDUFHO\UHPLQGP\VWXGHQWRIWKHSRZHUIXOVH[XDO
HPRWLRQVRIWHQDURXVHGE\DNLVVRUWRXFKRIWKHFKHHNRUHYHQWKHKROGLQJRI
KDQGVȈWKLVNQRZOHGJHLVFRPPRQWRWKHUDFHDOWKRXJKIHZXQGHUVWDQGWKH
UHDOQDWXUHRIWKHSKHQRPHQD(QRXJKIRUPHWRVD\WKDWWKHOLEHUWLQHJHQHUDOO\
UHDOL]HVIXOOZHOOWKHSRZHUIXOYLEUDWLRQVZKLFKPD\EHFRQYH\HGLQWKLV
PDQQHUDOWKRXJKKHGRHVQRWXQGHUVWDQGWKHVFLHQWLILFIDFWVRIWKHFDVHȈKHKDV
WKHSUDFWLFHZHOOGHILQHGLQKLVPLQGDOWKRXJKKHGRHVQRWXQGHUVWDQGWKH
WKHRU\<RXQJSHUVRQVHVSHFLDOO\\RXQJZRPHQVKRXOGEHWDXJKWWKHGDQJHURI
WKLVIRUPRIPDJQHWLVPDQGVKRXOGDYRLGDOORZLQJWKHSK\VLFDOFRQWDFWZKLFK
PDNHVWKHVDPHDFWLYH7KHKROGLQJKDQGVWKHWKRXJKWOHVVNLVVSUHVVXUHRIWKH
FKHHNHPEUDFHRUFORVHSK\VLFDOFRQWDFWDOODIIRUGDQGIXUQLVKDGLUHFWOLQH
IRUWKHSDVVDJHRIWKLVIRUPRIPDJQHWLVPLHWKHVH[XDOPDJQHWLVPFRQYH\HG
WKURXJKFRUSRUHDOFKDQQHOV7KHXQSULQFLSOHGSHUVRQRIVWURQJSDVVLRQVVRRQ
OHDUQVWKDWE\FORVHSK\VLFDOFRQWDFWKHPD\RIWHQFRQYH\KLVHPRWLRQDO
YLEUDWLRQWRWKH\RXQJZRPDQDQGWKXVDURXVHUHFLSURFDOYLEUDWLRQVZKLFKPD\
VZHHSKHURIIKHUIHHWDQGLQWRKLVDUPVȈRIWHQWRKHUXWWHUUXLQDQGGLVJUDFH
7KLVLVQRWDSOHDVDQWVXEMHFWEXW,IHHOWKDW,ZRXOGQRWEHWUXHWRP\VWXGHQWVLI
,IDLOHGWRSRLQWRXWWKLVGDQJHURXVIRUFHDQGWRFDXWLRQWKHPWRJXDUGDJDLQVW
WKHHPSOR\PHQWRIWKHVDPHDJDLQVWWKHP
/HDYLQJWKLVSKDVHRIWKHVXEMHFW,QRZZLVKWRFDOOWKHDWWHQWLRQRIP\
VWXGHQWVWRWKHXVHRIFRUSRUHDOPDJQHWLVPLQWKHRUGLQDU\XVHRIWKHKDQGVDVLQ
VKDNLQJKDQGVHWF+HUHLVDVXEMHFWZRUWK\RIWKHFORVHVWDWWHQWLRQRQ\RXUSDUW
6WURQJO\PDJQHWLFPHQDQGWKRVHZKRKDYHVWXGLHGWKLVVXEMHFWIUHTXHQWO\
HPSOR\WKLVPHWKRGRISURMHFWLQJSHUVRQDOPDJQHWLVPLQPDNLQJWKHLU
SUHOLPLQDU\PRYHVLQWKHGLUHFWLRQRILQIOXHQFLQJRWKHUSHUVRQVE\SHUVRQDO
PDJQHWLVP:KRKDVQRWH[SHULHQFHGWKHPDJQHWLFKDQGVKDNHRILQGLYLGXDOVRI
WKLVNLQG"$QGRQWKHRWKHUKDQGZKRKDVQRWEHHQFRQVFLRXVRIWKHIHHOLQJRI
UHSXOVLRQLQVSLUHGE\WKHFROGFODPP\VQDNHOLNHKDQGVKDNHRIRWKHUW\SHVRI
SHUVRQV"
<RXKDYHDOVRSUREDEO\QRWLFHGWKDWPDQ\PHQZKRVHEXVLQHVVLWLVWR
LQIOXHQFH\RXLQDQ\GLUHFWLRQVXFKDVSROLWLFLDQVSUHDFKHUVSURPRWHUV
VDOHVPHQHWFKDYHDKDELWRISODFLQJWKHLUKDQGVXSRQ\RXUVKRXOGHUVGXULQJ
WKHFRQYHUVDWLRQȈRUOD\LQJWKHLUKDQGOLJKWO\RQ\RXUDUPZKLOHVSHDNLQJWR\RX
ȈLQVRPHFDVHVJLYLQJ\RXDILQDOSDWRQWKHEDFNDVWKH\XUJH\RXWRVLJQULJKW
KHUHDQGFORVHWKHWKLQJXS+DYH\RXUHDOL]HGWKDWWKLVLVDIRUPRIFRUSRUDO
PDJQHWLVPDQGWKDWWKHUHVXOWLVRIWHQYHU\HIIHFWLYH"/RRNRXWIRUWKHVHIHOORZV
LQWKHIXWXUHDQGQHXWUDOL]HWKHLUPDJQHWLVPDFFRUGLQJWRWKHUXOHVJLYHQLQWKH
LQWKHIXWXUHDQGQHXWUDOL]HWKHLUPDJQHWLVPDFFRUGLQJWRWKHUXOHVJLYHQLQWKH
QH[WFKDSWHURIWKLVERRN,I\RXFKRRVHWRHPSOR\WKHVHPHWKRGV\RXUVHOIȈ
ZHOOWKDWLV\RXURZQEXVLQHVVDQGDPDWWHUIRU\RXUVHOIWRGHFLGH,WLVDYHU\
VWURQJPHWKRGRIFRQYH\LQJFRUSRUHDOPDJQHWLVP,DVVXUH\RX
,QVKDNLQJKDQGVZLWKDQ\SHUVRQZKRP\RXPD\ZLVKWRLQIOXHQFH\RX
VKRXOGWKURZLQWRWKHFODVSWKHVWURQJHVWSRVVLEOHNLQGRISHUVRQDOPDJQHWLVP
SK\VLFDODQGPHQWDODFFRUGLQJWRWKHUXOHVDOUHDG\JLYHQ\RXLQWKLVERRN*LYH
WKHSHUVRQWKHGLUHFWFRPPDQGDWWKHPRPHQWRIWKHFODVSWKURZLQJLWLQWRKLP
E\PHDQVRIWKHQHUYHVRIWKHKDQGDQGILQJHUV $OLWWOHSUDFWLFHLQWKHGLUHFWLRQ
RIVKDNLQJKDQGVZLWK\RXUVHOIZLOOEHRIJUHDWDLGWR\RXLQWKLVPDWWHU 6HQG
KLPDPHQWDOPHVVDJHMXVWDV\RXZRXOGLI\RXZHUHPHUHO\ORRNLQJDWKLP
:KHQ\RXPHHWDSHUVRQZLWKZKRP\RXDUHDFTXDLQWHGWKHKDQGFODVSLVWKH
QDWXUDOWKLQJDQGLWJLYHV\RXDVSOHQGLGRSSRUWXQLW\WRJHWLQDSRZHUIXO
SUHOLPLQDU\IODVKRISHUVRQDOPDJQHWLVPDFFRPSDQLHGE\WKHVWURQJHVWSRVVLEOH
GLUHFWFRPPDQG:KHQWKLVLVSHUIRUPHGSURSHUO\LWZLOOVHUYHWRJHWWKHRWKHU
SHUVRQLQH[DFWO\WKHULJKWSV\FKLFFRQGLWLRQVWRUHFHLYH\RXUIXUWKHUGLUHFW
FRPPDQGVDQGWR\LHOGPRUHUHDGLO\WR\RXUPDJQHWLVP,WLV\RXUDGYDQFH
JXDUGSUHSDULQJWKHZD\IRUWKHJUDQGFKDUJHXSRQWKHEUHDVWZRUNVRIWKH
HQHP\8VHLWZHOODQGKDOIWKHEDWWOHZLOOEHZRQDWRQHVWURNH
$OZD\VEHKHDUW\LQ\RXUKDQGFODVSȈQRWURXJKRUWRRVWUHQXRXVIRUQRRQH
OLNHVWRKDYHKLVKDQGWLJKWO\VTXHH]HGRUEUXLVHGȈDOZD\VUHPHPEHUWKHZRUG
KHDUW\LQWKLVFRQQHFWLRQ%HZDUHRIWKHOLIHOHVVKDQGVKDNHȈWKURZIHHOLQJLQWR
LWDQGPDNHLWEHDOLYHDQGYLWDO6KDNHKDQGVDVLIWKHRWKHUSHUVRQPHDQW
VRPHWKLQJWR\RXDQGKROGRQWRKLVKDQGIRUDPRPHQWDQGWKHQOHWJRDVLI
ZLWKUHOXFWDQFH6HHNRXWVRPHVWURQJO\PDJQHWLFSHUVRQXVHGWRPHHWLQJ
SHRSOHȈVRPHVXFFHVVIXOSROLWLFLDQIRULQVWDQFHȈDQGOHWKLPVKDNHKDQGVZLWK
\RX1RWLFHKRZPXFKLQWHUHVWDQGIHHOLQJKHSXWVLQWRKLVFODVSȈDQGWKHQWDNH
QRWHVIURPKLVPHWKRGV$JRRGPDJQHWLFSUHDFKHUPHHWLQJKLVIORFNDWWKH
FKXUFKGRRUDVWKH\SDVVRXWDOVRZLOOJLYH\RXDJRRGH[DPSOH6WXG\WKHPDQG
FDWFKWKHPRWLRQ
:KHQVKDNLQJKDQGVZLWKDSHUVRQZKR\RXZLVKWRLQIOXHQFH\RXVKRXOG
WKURZLQWRWKHKDQGFODVSWKHGLUHFWFRPPDQGZKLFK\RXZLVKWRLPSUHVVXSRQ
KLP,I\RXZLVKKLPRUKHUWROLNH\RX\RXUGLUHFWFRPPDQGVKRXOGEHDORQJ
WKRVHOLQHVIRULQVWDQFHDVWURQJ<RX/,.(PH,I\RXZLVKWRDVVHUW\RXU
SRVLWLYLW\RYHUKLVSRZHU\RXVKRXOGJHWWRZRUNDWRQFHZLWKDYHU\VWURQJ
SRVLWLYH,DPVWURQJHUWKDQ\RXRU,DPIDUPRUH326,7,9(WKDQ\RXRU
VRPHRWKHUVWDWHPHQWRIWKHVDPHJHQHUDONLQGVXFKDV,KDYHJLYHQ\RXLQWKH
SUHFHGLQJFKDSWHUV,QIDFW\RXPD\XVHQD\RUDOORIWKHVWDWHPHQWVSUHYLRXVO\
JLYHQWR\RXLQWKLVIRUPDVZHOODVLQWKHRUGLQDU\SKDVHVRIWKHGLUHFW
FRPPDQG
FRPPDQG
,QFRQFOXGLQJWKLVFKDSWHU,ZLVKWRFDOO\RXUDWWHQWLRQWRDSKDVHRIWKH
SKHQRPHQDRIFRUSRUHDOPDJQHWLVPZKLFKLVRIWHQRYHUORRNHGE\WHDFKHUVRI
WKHVXEMHFW,DOOXGHWRWKDWIRUPRIPDJQHWLVPZKLFKLVSURMHFWHGE\PHUH
QHDUQHVVRIWKHERGLHVRISHUVRQVHYHQWKRXJKGLUHFWFRQWDFWPD\QRWEHKDG
*RRGVDOHVPHQDQGRWKHUVRIWHQNQRZWKLVIURPWKHLURZQH[SHULHQFHDOWKRXJK
QRWXQGHUVWDQGLQJWKHUHDOFDXVH7KH\NQRZWKDWE\VLWWLQJQHDUWRWKHFXVWRPHU
WKH\FDQJHWDEHWWHUPDJQHWLFHIIHFWWKDQLIFRPSHOOHGWRVLWDWDOLWWOHGLVWDQFH
7KHUHVXOWRIWKHKHDUWWRKHDUWWDONRIWHQUHVXOWVIURPWKLVQHDUQHVV,QWKH
VDPHZD\WKHJHVWXUHVRIWKHKDQGVRIDVSHDNHUFRPLQJLQFORVHFRQWDFWWR
RWKHUSHUVRQVRIWHQVHUYHVWRFRQYH\WKHPDJQHWLVPWRWKHPDOWKRXJKQRDFWXDO
FRQWDFWLVKDG
7KHKDQGVSDUWLFXODUO\DUHYHU\HIIHFWLYHLQVWUXPHQWVIRUWKHFRQYH\RURI
FRUSRUHDOPDJQHWLVPIRUWKHQHUYHVRIWKHILQJHUVDUHYHU\VHQVLWLYHDQGUHDGLO\
FRQYH\DQGSURMHFWWKHPDJQHWLVPZLWKJUHDWFRQFHQWUDWHGIRUFH7KHXVHRIWKH
ILQJHUVRIWKHPHVPHULVWLVEXWRQHH[DPSOHRIWKLVIDFW<RXZLOODOVRQRWLFHWKDW
WKHPDMRULW\RIHIIHFWLYHRUDWRUVDQGVSHDNHUVKDYHDZD\RIPDNLQJSDVVHVDQG
ZDYHVDWWKHLUDXGLHQFHV7KHJRRGVROLFLWRURUSURPRWHUXVXDOO\HPSOR\VKLV
KDQGVLQWKLVZD\5HPHPEHU,GRQRWVD\WKDWWKHVHSHRSOHDUHDOZD\V
FRQVFLRXVRIWKHIDFWVEHKLQGWKHLUJHVWXUHVȈWKH\RIWHQDUHLJQRUDQWRIWKHVDPH
DQGXVHWKHLUKDQGVLQVWLQFWLYHO\KDYLQJDFTXLUHGWKHPRYHPHQWVWKURXJKKDELW
%XWWKHIDFWVUHPDLQDQGWKRVHZKROHDUQWKHVHFUHWRIWKHIRUFHDQGLWV
HPSOR\PHQWDQGWKHUHDIWHUXVHLWFRQVFLRXVO\DQGGHOLEHUDWHO\DUHSODFHGDWD
JUHDWDGYDQWDJHRYHURWKHUVZKRGRQRWSRVVHVVWKLVNQRZOHGJH$QGPDUNP\
ZRUGVWKHUHDUHWKRXVDQGVRIWKHZRUOGVJUHDWHVWPHQZKRKDYHOHDUQHGWKLV
VHFUHWWDNHQOHVVRQVLQLWVXVHDQGDUHQRZHPSOR\LQJLWDFWLYHO\<RXPD\QRZ
MRLQWKHLUUDQNVLI\RXFDUHWRGRVR
&KDSWHU
0DJQHWLF6HOI'HIHQVH
7DEOHRI&RQWHQW

$QGQRZKDYLQJDFTXDLQWHG\RXZLWKWKHYDULRXVIRUPVRIWKHPDQLIHVWDWLRQ
SURMHFWLRQDQGXVHRISHUVRQDOPDJQHWLVPȈKDYLQJWDXJKW\RXQRWRQO\WKH
WKHRU\EXWDOVRWKHSUDFWLFHQRWRQO\KRZWRDFTXLUHWKHWHFKQLTXHEXWDOVRKRZ
WRHIIHFWLYHO\HPSOR\WKHVDPHȈ,ZLOOFRQFOXGHE\FDOOLQJ\RXUDWWHQWLRQWRWKH
GHIHQVLYHVLGHRIWKHTXHVWLRQ,QER[LQJRUIHQFLQJ\RXKDYHQRWPDVWHUHGWKH
DUWIXOO\XQWLO\RXDUHDEOHQRWRQO\WRDWWDFNEXWDOVRKRZWRGHIHQGȈQRWRQO\
WKHDUWRIDJJUHVVLYHDFWLRQEXWDOVRWKHVFLHQFHRIGHIHQVLYHDFWLRQ$QGVRLWLV
LQWKHFDVHRISHUVRQDOPDJQHWLVP\RXPXVWQRWRQO\NQRZKRZWRXVHWKHIRUFH
LQWKHIRUPRISURMHFWLRQEXW\RXPXVWDOVRNQRZKRZWRGHIHQG\RXUVHOIDJDLQVW
WKHSURMHFWLRQRIWKHIRUFHE\RWKHUV
,WLVWUXHWKDWWKHFDUHIXODQGGLOLJHQWVWXGHQWRIWKHVHOHVVRQVZLOOJUDGXDOO\
GHYHORSVXFKDSRZHUZLWKLQKLPVHOIWKDWKHZLOOVFDUFHO\HYHUPHHWLQGLYLGXDOV
PRUHSRZHUIXOWKDQKLPVHOI%XWVWLOOWKHUHDUHDOZD\VWKHYHU\VWURQJ
LQGLYLGXDOVWREHUHFNRQHGZLWKDQG,ZDQW\RXWRSRVVHVVWKHVHFUHWRI
GLVSHUVLQJDQGGLVVLSDWLQJWKHPDJQHWLVPRIVXFKSHUVRQVVRIDUDVHIIHFWRQ
\RXUVHOILVFRQFHUQHGE\WKHPHWKRGVNQRZQWRDOODGYDQFHGVWXGHQWVDQG
SUDFWLWLRQHUVRISHUVRQDOPDJQHWLVP
7KLVGHIHQVLYHVFLHQFHLVIDUVLPSOHUWKDQ\RXZRXOGWKLQNDWILUVWDOWKRXJK
WREHHIIHFWLYHLQWKHVDPH\RXPXVWILUVWKDYHOHDUQHGKRZWRSURMHFWHIIHFWLYHO\
,PD\VXPLWXSLQDIHZZRUGVȈKHHGWKHPFDUHIXOO\7KHVHFUHWLVWKLV,Q
GHIHQGLQJRQHVHOIDJDLQVWPDJQHWLFSURMHFWLRQLQDQ\RUDOORILWVIRUPV\RXKDYH
EXWWRSURMHFWWRZDUGWKHRWKHUSHUVRQDVWURQJ'(1,$/RIKLVSRZHUWR
LQIOXHQFHDIIHFWRUPDVWHU\RX7KDWLVWKHZKROHWKLQJLQDQXWVKHOO1RZIRU
WKHGHWDLOV
%XWULJKWKHUH,ZDQWWRUHPLQG\RXRIDYHU\LPSRUWDQWIDFWDQGWKDWLVLQ
WKLVGHQLDO\RXGRQRWUHDOO\GHVWUR\RUOHVVHQWKHSRZHURIWKHRWKHUSHUVRQLQ
JHQHUDO<RXRQO\QHXWUDOL]HKLVPDJQHWLVPVRIDUDVLWDIIHFWV\RXUVHOIRUWKRVH
ZKRP\RXZLVKWRSURWHFW,QRWKHUZRUGVLQVWHDGRIGHVWUR\LQJKLVZHDSRQV
\RXPHUHO\WXUQWKHPDVLGHDQGFDXVHWKHPWRJODQFHRIIOHDYLQJ\RXDQG
\RXUVKDUPOHVV7RXVHDIDPLOLDULOOXVWUDWLRQIURPWKHILHOGRIHOHFWULFLW\\RX
UHQGHU\RXUVHOIDQRQFRQGXFWRUDQGWKHIRUFHJODQFHVRII\RXZLWKRXWDIIHFWLQJ
\RXLQWKHVOLJKWHVW5HPHPEHUWKLVLOOXVWUDWLRQDQG\RXZLOOKDYHWKHLGHD
\RXLQWKHVOLJKWHVW5HPHPEHUWKLVLOOXVWUDWLRQDQG\RXZLOOKDYHWKHLGHD
ILUPO\IL[HGLQ\RXUPLQG
<RXPD\UHQGHU\RXUVHOILPPXQHQRWRQO\IURPWKHGLUHFWIODVKDQGGLUHFW
GHPDQGRUFRPPDQGRIRWKHUVQRPDWWHUKRZVWURQJWKH\PD\EHEXWDOVRIURP
WKHJHQHUDOFRQWDJLRQRIWKHPHQWDODWPRVSKHUHRUDXUDVRIRWKHUV%\SURSHU
FRQFHQWUDWHGHIIRUWDORQJWKHVHOLQHV\RXPD\UHQGHU\RXUVHOIDEVROXWHO\
LPPXQHIURPWKHIRUFHRIWKHSHUVRQDOPDJQHWLVPRIRWKHUVLI\RXVRGHVLUH2U
LI\RXSUHIHU\RXPD\VKXWRXWRQO\FHUWDLQLQGLYLGXDOVIURP\RXUILHOGDQG
DOORZWKHEHQHILFLDOPDJQHWLVPRIRWKHUVWRHQWHULW,QWUXWK\RXDUH\RXURZQ
0$67(5LI\RXEXWH[HUW\RXUSRZHU
$VWRWKHPHWKRGVWREHHPSOR\HG\RXKDYHEXWWRXVHWKRVH\RXKDYH
DOUHDG\OHDUQHGLQWKHVHOHVVRQVE\PHUHO\FKDQJLQJWKHPHQWDODWWLWXGHDQG
VWDWHPHQWRUFRPPDQG)RULQVWDQFHLQVWHDGRISURMHFWLQJWKHGLUHFWFRPPDQG
WKDW\RXDUHVWURQJHUWKDQWKHRWKHUSHUVRQDQGFDQWKHUHIRUHLQIOXHQFHKLP\RX
KDYHEXWWRFDOPO\'(1<KLVSRZHURYHU\RXDQGGHI\KLPWRDIIHFW\RXLQWKH
VOLJKWHVW$VDPDWWHURIIDFWWKDWPHQWDODWWLWXGHLVIDUOHVVVWUHQXRXVWKDQWKH
DJJUHVVLYHIRUPRIPDJQHWLFSURMHFWLRQ,WUHTXLUHVPHUHO\WKHLQWHUSRVLWLRQRI
\RXUPDJQHWLFVKLHOGRIGHIHQVHDQGKLVSRZHUZLOOJODQFHRIIZLWKRXWDIIHFWLQJ
\RXHYHQWKRXJKKHLVPRVWVWUHQXRXVO\SURMHFWLQJLW7KHUHLVRIFRXUVHWKH
RWKHUSODQRIILJKWLQJDJJUHVVLYHPDJQHWLVPZLWKDJJUHVVLYHPDJQHWLVPȈWKLVLV
WKHUHDOPDJQHWLFGXHOLQLWVSODLQIRUPDQGPD\EHXVHGZKHQGHVLUHG%XWLI
\RXPHUHO\ZLVKWRUHSHOWKHDJJUHVVLRQRIRWKHUV\RXKDYHEXWWRXVHWKH
GHIHQVLYHSODQRIWKH'(1,$/DV,KDYHMXVWWROG\RX
,QIRUPLQJWKHPHQWDOVWDWHPHQWZKLFKDFFRPSDQLHVDOOIRUPVRIWKHXVHRI
PHQWDOPDJQHWLVPDV\RXKDYHVHHQ\RXPHUHO\H[SUHVV PHQWDOO\ LQDIHZ
VWURQJSRVLWLYHZRUGVWKHLGHD\RXZLVKWRUHDFKWKHRWKHUSHUVRQ VPLQG:HOO
VRLWLVWKHFDVHRIPDJQHWLFVHOIGHIHQVH<RXVLPSO\PHQWDOO\VWDWHLQDIHZ
VWURQJZRUGVWKDW\RXGHQ\WKHSRZHURIWKHRWKHUSHUVRQ<RXZLOOILQGDV\RX
H[SHULPHQWWKDWLQWKHYHU\ZRUGV,'(1<WKHUHLVDPLJKW\G\QDPLFSRZHU
RIGHIHQVH,WLVWKHPHQWDOLGHDEHKLQGWKHVHZRUGVZKLFKILJXUDWLYHO\ZLSHV
RXWRIH[LVWHQFHWKHRWKHUSHUVRQ VPDJQHWLVPDWOHDVWVRIDUDV\RX\RXUVHOIDUH
FRQFHUQHG,WLVWKHJUHDW6+,(/'2)'()(16(/HWWKHIXOOPHDQLQJRIWKH
ZRUG'(1<HQWHULQWR\RXUPLQGȈ\RXZLOOILQGLWFRQWDLQVDQHZPHDQLQJ
DQGVWUHQJWKZKHQFRQVLGHUHGLQWKLVFRQQHFWLRQ
1RZULJKWDWWKLVSRLQWEHIRUHSURFHHGLQJIXUWKHU,DVN\RXWRWXUQEDFN
RYHUWKHOHDYHVRIWKHSUHFHGLQJOHVVRQVDQGPDNHQRWHRIWKHQXPHURXV
VWDWHPHQWVJLYHQWRDFFRPSDQ\WKHSRVLWLYHDXUDWKHGLUHFWIODVKWKHGLUHFW
FRPPDQGHWF7KHQIURPZLWKLQ\RXURZQPLQGWKHGHQLDORIWKHVHVWDWHPHQWV
LIWKH\DUHSURMHFWHGE\DQRWKHUSHUVRQ DQG\RXZLOOILQGWKDW\RXSRVVHVV
LQVWLQFWLYHO\WKHSRZHUWRIUDPHVXFKVWDWHPHQWVRIGHQLDOHDVLO\3UDFWLFHD
OLWWOHLPDJLQLQJWKDWDQRWKHUSHUVRQLVKXUOLQJWKHVHIODVKHVRUFRPPDQGVDW\RX
DQGWKDW\RXDUHLQWHUSRVLQJWKHVKLHOGRIGHQLDOLQHDFKFDVH<RXZLOOEH
VXUSULVHGDQGGHOLJKWHGWRUHDOL]HKRZHDVLO\\RXFDQUHSHOWKHVWURQJHVWRI
WKHVHDVVDXOWV<RXPD\WKHQEHJLQWRSUDFWLFHE\WKURZLQJ\RXUVHOILQWRWKH
SUHVHQFHDQGFRPSDQ\RIWKHVWURQJHVWPDJQHWLFSHUVRQV\RXNQRZDQGWKHQVHH
KRZHDVLO\\RXFDQUHSHOWKHLUSRZHUȈDQGKRZIUHHFDOPDQGVHUHQH\RXQRZ
IHHOLQWKHLUSUHVHQFH
7KHUHDUHWZRWKLQJVWREHUHPHPEHUHGLQWKLVFRQQHFWLRQȈ,KDYHDOUHDG\
WROG\RXWKHPEXWLWLVZHOOWRUHSHDWWKHPLQRUGHUWRIL[WKHPILUPO\LQ\RXU
PLQG,DVN\RXWRFRQVLGHUWKHPLQWKHIROORZLQJSDUDJUDSKV
,QWKHILUVWSODFHDV,KDYHWROG\RXWKLVGHIHQVLYHSURFHVVPHUHO\HQDEOHV
\RXWRWKURZRIIDQGUHQGHU\RXUVHOILPPXQHIURPWKHDJJUHVVLYHPDJQHWLVPRI
RWKHUVȈLWGRHVQRWHQDEOH\RXWRPDVWHUWKHPRUWRFRPSHOWKHPWRGR\RXU
ELGGLQJ,QRUGHUWRDFFRPSOLVKWKHODWWHU\RXPXVWEHDWGRZQWKHJXDUGRIWKH
RWKHUSHUVRQSURWHFW\RXUVHOIDWWKHVDPHWLPHDQGWKHQFDUU\WKHGD\E\DGLUHFW
PDJQHWLFDVVDXOWXSRQKLP<RXFDQGRWKHVHWKLQJVLIKHILJKWV\RXZLWKWKH
ZHDSRQVRIDJJUHVVLYHPDJQHWLVPRQO\EXWLIKH'(1<\RXUSRZHUKHLV
LPPXQHDQG\RXFDQQRWDIIHFWKLPMXVWDVLI\RX'(1<KLVSRZHU\RXDUH
LPPXQHȈLQFDVHERWK'(1<WKHQWKHEDWWOHLVGUDZQDQGQHLWKHUZLQ7KH
'HQLDOLVQRWDZHDSRQRIDJJUHVVLYHQHVVȈLWLVPHUHO\WKHVKLHOGRIGHIHQVH
5HPHPEHUWKLV2IFRXUVHLI\RXXVHERWKVKLHOGDQGVZRUG\RXZLOOKDYHD
GRXEOHDGYDQWDJHSURYLGLQJKHGRHVQRWDOVRXVHWKHVKLHOG)RULI\RXFDQUHSHO
KLVPDJQHWLVPDQGDWWKHVDPHWLPHXVH\RXURZQȈWKHQKHLVDW\RXUPHUF\
%XWLIKHNQRZVHQRXJKWRDOVRXVHKLVVKLHOGȈWKHQWKHEDWWOHZLOOEHGUDZQDQG
QHLWKHUZLOOZLQDGHFLGHGYLFWRU\'R\RXFDWFKWKHLGHD"7KLQNRYHULWXQWLOLWLV
SODLQWR\RX
7KHVHFRQGSRLQW,ZLVKWRLPSUHVVXSRQ\RXLQWKLVFRQQHFWLRQLVWKHIDFW
DOUHDG\VWDWHGE\PHWKDW\RXGRQRWDFWXDOO\GHVWUR\RUZHDNHQWKHRWKHU
SHUVRQ VPDJQHWLVPE\WKHXVHRIWKHVKLHOGRIGHQLDO+LVPDJQHWLVPUHPDLQV
MXVWDVVWURQJDQGMXVWDVPXFKLQHYLGHQFHDVLI\RXGLGQRWXVHWKHVKLHOGȈWKH
RQO\GLIIHUHQFHEHLQJWKDWE\XVLQJLW\RXUHQGHUKLVZHDSRQVSRZHUOHVVDJDLQVW
\RXRUWKRVH\RXPD\ZLVKWRSURWHFWDQGWKXVFUHDWHLPPXQLW\IRU\RXUVHOI
DQG\RXUSURW©J©VE\LQWHUSRVLQJWKHVKLHOGRIGHIHQVH%XW\RXGRQRWLPSDLU
WKHSRZHURIWKHRWKHUSHUVRQDJDLQVWRWKHUVZKRP\RXGRQRWGLUHFWO\VKHOWHU
EHKLQG\RXUVKLHOG'R\RXJHWWKLVSRLQW"7KLQNRYHULWXQWLO\RXJHWLWFOHDUO\
:KHQ\RXUHSHOWKHPDJQHWLVPRIRQHRIWKHSHUVRQVZKRKDYHEHHQXVLQJLW
ZLWKRXWNQRZLQJWKHQDWXUHRIKLVSRZHU DQGWKHUHDUHPDQ\ZKRVRXVHLWȈWKH
PDMRULW\RISHUVRQVLQIDFW \RXZLOOEHDPXVHGWRVHHKRZEURNHQXSVXFKD
SHUVRQEHFRPHV+HZLOOEHFRPHEHZLOGHUHGDWKLVIDLOXUHWRLQIOXHQFHDQGDIIHFW
\RXDQGZLOORIWHQEHFRPHHPEDUUDVVHGDQGLQVRPHFDVHVDFWXDOO\HQWDQJOHG
\RXDQGZLOORIWHQEHFRPHHPEDUUDVVHGDQGLQVRPHFDVHVDFWXDOO\HQWDQJOHG
LQWKHFXUUHQWVRIKLVRZQPDJQHWLVP,WPD\HYHQKDSSHQ LWRIWHQGRHVUHDOO\
WKDWVXFKDSHUVRQZLOOEHFRPHVRFRQIXVHGE\KLVDSSDUHQWORVVRISRZHUWKDW
KHZLOOORVHKLVDVVXUDQFHDQGFRQVHTXHQWO\KLVDELOLW\WRDWWDFN,QVXFKFDVHVKH
EHFRPHVDQHDV\VXEMHFWIRUDPDJQHWLFUXVKRUEURDGVLGHRQ\RXURZQSDUW
ZKLFKZLOOTXLFNO\GULYHKLPLQWRDGLVDVWURXVUHWUHDW2IFRXUVHLIKHKDVD
VFLHQWLILFNQRZOHGJHRIWKHVXEMHFWKHZLOOQRWEHVRWDNHQRIIJXDUGEXW
UHFRJQL]LQJ\RXUNQRZOHGJHDQGSRZHUKHZLOOSDVVLWRIIZLWKDVPLOHDQG
UHOLQTXLVKWKHDWWDFN
$QGQRZJRRGVWXGHQWZHSDUWFRPSDQ\IRUWKHSUHVHQW,DPJODGWRKDYH
KDGWKHKRQRURIJLYLQJ\RXWKLVLQVWUXFWLRQLQWKHVHOHVVRQVDQG,WUXVWWKDW\RX
ZLOOVRFRQGXFW\RXUVHOIWKDW\RXZLOOEHDFUHGLWDEOHSXSLORIPLQHDQGGRPH
KRQRUE\\RXUDFFRPSOLVKPHQWVDQGDWWDLQPHQWV,KDYHVXSSOLHG\RXZLWKWKH
ZHDSRQVRIERWKDJJUHVVLYHDQGDOVRRIGHIHQVLYHSHUVRQDOPDJQHWLVPDQGKDYH
WDXJKW\RXKRZWRHPSOR\ERWKRIWKHPVRDVWRJHWWKHEHVWUHVXOWV,WLVQRZXS
WR\RXWRPDNHWKHEHVWXVHRIWKHVHZHDSRQVDFFRUGLQJWRWKHUXOHDQG
SULQFLSOHVZKLFK,KDYHODLGGRZQIRU\RXUJXLGDQFH
,QSDUWLQJ,ZLVKWRDJDLQLPSUHVVWZRLPSRUWDQWUXOHVXSRQ\RXDQGWKHVH
DUH
 3UDFWLFHSUDFWLFHSUDFWLFHXQWLO\RXKDYHHYHU\GHWDLORIWKHLQVWUXFWLRQ
VRZHOOOHDUQHGDQGVRIL[HGE\KDELWWKDW\RXFDQDQGZLOOXVHWKHP
LQVWLQFWLYHO\MXVWDV\RXQRZZDONRUEUHDWKHRUVSHDN
 .HHS\RXURZQVHFUHWVDQGGRQRWGLVVLSDWHDQGVFDWWHU\RXULQIOXHQFHE\
KLQWLQJRI\RXUVHFUHWVRI\RXUSRZHURYHURWKHUV7KHUHDUHPDQ\JRRGUHDVRQV
IRUWKLVUXOHȈVRPHUHDVRQVWKDWGRQRWDSSHDURQWKHVXUIDFHE\WKHZD\
5HPHPEHUWKHROG,WDOLDQSURYHUE,OERFFDFKLXVDQRQF HQWUDPRVFDȈWKDWLV
WRVD\,QWRWKHFORVHGPRXWKQRIOLHVHQWHU+HHGWKHVSLULWRIWKHSURYHUE
$XUHYRLUP\PDJQHWLFIULHQGVȈZHVKDOOPHHWDJDLQLQGXHWLPH
7KHURQ4'XPRQW

You might also like