5(&200(1'(' )25 )8//7(;7 38%/,&$7,21 3XUVXDQW WR 6L[WK &LUFXLW 5XOH  (/(&7521,& &,7$7,21  )(' $SS 3 WK &LU )LOH 1DPH DS 81,7('67$7(6&28572)$33($/6 )257+(6,;7+&,5&8,7 BBBBBBBBBBBBBBBBB 81,7(' 67$7(6 2) $0(5,&$ ; 3ODLQWLII$SSHOOHH    1R Y  !  5($/ 3523(57 @ IRUIHLWXUH    ZKHUH WKH 6WDWHVY'DFFDUHWW)GG&LU1RWH SURSHUW\ LV FODLPHG E\ DQ\ SHUVRQ WKH EXUGHQ RI SURRI VKDOO OLH XSRQ VXFK FODLPDQW    3URYLGHG 7KDW SUREDEOH FDXVH VKDOO ILUVW &LYLO)RUIHLWXUHDQGWKH([FHVVLYH)LQHV&ODXVH8)OD EH VKRZQ IRU WKH LQVWLWXWLRQ RI VXFK VXLW RU DFWLRQ WR EH MXGJHG s/  3XE 3ROj\  6SULQJ  1RWH ([DFWO\ +RZ E\ WKH FRXUW    0XFK3URFHVV,V'XH"7KH)HGHUDO&RXUWV*UDSSOHZLWKWKH  86& †   8QLWHG6WDWHVY5HDO3URSHUW\HWDO 1R 1R 8QLWHG6WDWHVY5HDO3URSHUW\HWDO  DIWHUWKHGDWHRIHQDFWPHQWRIWKLV$FWlZKLFKZDV$XJXVW ZKHWKHU LW DSSOLHV WR SHQGLQJ FDVHV WKH FDVH ODZ RQ WKH ,G  VXEMHFWFRQWUROV 1RGHILQLWLRQLVJLYHQRIZKDWLWPHDQVIRUIRUIHLWXUHWREH :HDUHJXLGHGE\/DQGJUDIY86,)LOP3URGV86 mFRPPHQFHGl'RHVWKLVPHDQVHL]XUHRIWKHSURSHUW\WKH /DQGJUDIUHFRQFLOHGWZRGLIIHUHQWOLQHVRIFDVHV ILOLQJRIDGRFXPHQWLQFRXUWDILQGLQJRISUREDEOHFDXVHWKH 2QH OLQHRIFDVHVKROGVWKDWDFRXUWPXVWDSSO\WKHODZLQ HVWDEOLVKPHQW RI D SUHSRQGHUDQFH RI WKH HYLGHQFH RU VRPH HIIHFWDWWKHWLPHLWUHQGHUVLWVGHFLVLRQ6HHHJ%UDGOH\ RWKHUDFWE\WKHJRYHUQPHQWRUWKHFRXUW"%HFDXVHIRUIHLWXUH 86DWm>$@FRXUWLVWRDSSO\WKHODZLQHIIHFWDWWKH GRHVQRWRFFXUXQWLODFRXUWDFWVGRHVLWPHDQWKDWIRUIHLWXUH WLPHLWUHQGHUVLWVGHFLVLRQXQOHVVGRLQJVRZRXOGUHVXOWLQ LV QRW mFRPPHQFHGl XQWLO WKH FRXUW ILQDOO\ DOORZV WKH PDQLIHVWLQMXVWLFHRUWKHUHLVVWDWXWRU\GLUHFWLRQRUOHJLVODWLYH IRUIHLWXUHWRWDNHSODFHoDWZKLFKWLPHWKHDFWXDOIRUIHLWXUH KLVWRU\WRWKHFRQWUDU\l7KHRWKHUOLQHRIFDVHVKROGVWKDW mFRPPHQFHV"l  7KH QHZ DFW VD\V LW LV DSSOLFDEOH WR mDQ\ UHWURDFWLYLW\RIQHZVWDWXWHVLVQRWIDYRUHGXQGHUWKHODZ6HH IRUIHLWXUHSURFHHGLQJFRPPHQFHGlGD\VDIWHUHQDFWPHQW %RZHQY*HRUJHWRZQ8QLY+RVS86 'RHVDQDSSHOODWHSURFHHGLQJTXDOLI\" /DQGJUDI H[SODLQHG WKDW WKH WZR OLQHV RI FDVHV ZHUH QRW %HFDXVH WKH QHZ OHJLVODWLRQ EHDUV GLUHFWO\ RQ D SULPDU\ LQFRQVLVWHQW/DQGJUDIGLUHFWHGWKDWDFRXUWVKRXOGQRWDSSO\ LVVXHLQWKHFDVHWKHSDQHOGLUHFWHGWKHSDUWLHVWRILOHOHWWHU D QHZ VWDWXWH WR FRQGXFW DULVLQJ EHIRUH SDVVDJH RI WKH EULHIVRQWKHTXHVWLRQRIZKHWKHULWVKRXOGDSSO\WRSHQGLQJ OHJLVODWLRQ LI D mQHZ SURYLVLRQ DWWDFKHV QHZ OHJDO FDVHV7KHJRYHUQPHQWKHUHUHSUHVHQWHGE\WKH8QLWHG6WDWHV FRQVHTXHQFHV WR HYHQWV FRPSOHWHG EHIRUH HQDFWPHQWl  $WWRUQH\jV 2IILFH LQ %D\ &LW\ 0LFKLJDQ UHVSRQGHG LQ LWV 86 DW  RU mZRXOG LPSDLU ULJKWV D SDUW\ SRVVHVVHG EULHI WKDW XQGHU WKH SODLQ ODQJXDJH RI WKH VWDWXWH WKH ZKHQKHDFWHGLQFUHDVHDSDUW\jVOLDELOLW\IRUSDVWFRQGXFWRU OHJLVODWLRQ LV QRW WR EH DSSOLHG WR SHQGLQJ FDVHV  7KH LPSRVH QHZ GXWLHV ZLWK UHVSHFW WR WUDQVDFWLRQV DOUHDG\ FODLPDQWV VWDWHG LQ WKHLU EULHI WKDW WKH\ KDG UHFHLYHG FRPSOHWHGl,GDW7KH&RXUWH[SODLQHGWKDWWKHSULPDU\ LQIRUPDWLRQ IURP WKH 8QLWHG 6WDWHV $WWRUQH\jV 2IILFH LQ UHDVRQ IRU WKH UXOH DJDLQVW UHWURDFWLYLW\ LV JURXQGHG LQ 'HQYHU&RORUDGRZKLFKLVQRWWKH8QLWHG6WDWHV$WWRUQH\jV IDLUQHVVZKLFKGLFWDWHVWKDWLQGLYLGXDOVKDYHDQRSSRUWXQLW\ 2IILFHLQFKDUJHRIWKLVFDVHWKDWWKHSRVLWLRQRIWKH8QLWHG WRNQRZWKHODZDQGWRFRQIRUPWKHLUFRQGXFWDFFRUGLQJO\ 6WDWHV'HSDUWPHQWRIsXVWLFHLVWKDWWKHFRXUWVFRXOGSURFHHG RQ D FDVHE\FDVH EDVLV FRQFHUQLQJ DSSOLFDELOLW\ RI WKH *HQHUDOO\ ZKHQ D VWDWXWH LV DGGUHVVHG WR UHPHGLHV RU OHJLVODWLRQWRSHQGLQJFDVHV SURFHGXUHV DQG GRHV QRW DOWHU VXEVWDQWLYH ULJKWV LW ZLOO EH DSSOLHGWRSHQGLQJFDVHV/DQGJUDI86DW8QLWHG 7KH 6XSUHPH &RXUW KDV VWDWHG WKDW mHYHQ ZKHUH WKH 6WDWHV Y &HUWDLQ )XQGV &RQWDLQHG LQ $FFRXQW 1RV  LQWHUYHQLQJ ODZ GRHV QRW H[SOLFLWO\ UHFLWH WKDW LW LV WR EH DQG)G DSSOLHG WR SHQGLQJ FDVHV LW LV WR EH JLYHQ UHFRJQLWLRQ DQG   G &LU  DSSO\LQJ WR D SHQGLQJ FDVH DQ HIIHFWl%UDGOH\Y6FKRRO%GRI5LFKPRQG86 DPHQGPHQW WR WKH FLYLO IRUIHLWXUH VWDWXWH SURYLGLQJ IHGHUDO $FFRUG/DQGJUDIY86,)LOP3URGV86 FRXUWV ZLWK MXULVGLFWLRQ WR UHV ORFDWHG RYHUVHDV )ULHO Y    m(YHQ DEVHQW VSHFLILF OHJLVODWLYH &HVVQD$LUFUDIW&R)GWK&LUFKDQJH DXWKRUL]DWLRQ DSSOLFDWLRQ RI QHZ VWDWXWHV SDVVHG DIWHU WKH LQ VWDWXWH RI OLPLWDWLRQV WR EHQHILW RI SODLQWLII JLYHQ HYHQWV LQ WKH VXLW LV XQTXHVWLRQDEO\ SURSHU LQ PDQ\ UHWURVSHFWLYH HIIHFW VHH DOVR  6XWKHUODQG 6WDWXWHV DQG VLWXDWLRQVl  %HFDXVH WKH VWDWXWH GRHV QRW H[SOLFLWO\ VWDWH 6WDWXWRU\ &RQVWUXFWLRQ †  6DQGV WK HG   ,Q /DQGJUDIWKH6XSUHPH&RXUWVWDWHGWKDWSURFHGXUDOUXOHVWHQG