L Q N H G W R W K H /$ HU DF VK
/ L Q N H G W R W K H /$ HU DF VK
WH U
3 H’ DU
▇▇ ▇▇
UHW PO KLV HQ J 0 &L RRG PI O P D R
D Q G W K H 7 K &DH RO
PW: P R ’ QL V
6Q WH R\
F N& R
RP SI
D Q \
7 KH &RQWLQJ HQW,QFRP H Z LWK 0 HP RU\ ) HDWXUH $ XWR &DOODEOH <LHOG 1 RWHV / LQNHG WR WKH / HDVW3 HUIRUP LQJ RI WKH &RP P RQ 6 WRFN RI $ UFKHU’ DQLHOV 0 LGODQG &RP SDQ\ WKH &RP P RQ 6 WRFN R ’ HHUH &RP SDQ\ DQG WKH &RP P RQ 6 WRFNRI 7 KH : DOW’ LVQH\ &RP SDQ\ GXH 2 FWREHU WKH ‡1 RWHV· SULFHG RQ 2 FWREHU DQG Z LOOLVVXH RQ 2 FWREHU
$ SSUR[ LP DWH \ HDUWHUP LI QRWFDOOHG SULRUWR P DWXULW\
3 D\ P HQWV RQ WKH 1 RWHV Z LOOGHSHQG RQ WKH LQGLYLGXDOSHUIRUP DQFH RI WKH FRP P RQ VWRFN RI $ UFKHU’ DQLHOV 0 LGODQG &RP SDQ\ WKH FRP P RQ VWRFN RI ’ HHUH &RP SDQ\ DQG WKH FRP P RQ VWRFN R
7 KH : DOW’ LVQH\ &RP SDQ\ HDFK DQ ‡8 QGHUO\ LQJ 6 WRFN·
&RQWLQJ HQWFRXSRQV SD\ DEOH TXDUWHUO\ LI WKH 2 EVHUYDWLRQ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFN RQ WKH DSSOLFDEOH 2 EVHUYDWLRQ ’ DWH LV J UHDWHUWKDQ RUHTXDOWR RI LWV 6 WDUWLQJ 9 DOXH DVVXP LQJ WKH 1 RWHV KDYH QRWEHHQ FDOOHG 7 KH FRXSRQ SHU LQ SULQFLSDODP RXQWRI 1 RWHV SD\ DEOH RQ WKH UHODWHG &RQWLQJ HQW3 D\ P HQW’ DWH LI DSSOLFDEOH Z LOOHTXDO L WKH SURGXFWRI
WLP HV WKH QXP EHURI &RQWLQJ HQW3 D\ P HQW’ DWHV WKDWKDYH RFFXUUHG XS WR WKH UHOHYDQW&RQWLQJ HQW3 D\ P HQW’ DWH LQFOXVLYH RI WKH UHOHYDQW&RQWLQJ HQW3 D\ P HQW’ DWH P LQXV LL WKH VXP RI D &RQWLQJ HQW&RXSRQ 3 D\ P HQWVSUHYLRXVO\ SDLG
%HJ LQQLQJ Z LWK WKH $ SULO &DOO2 EVHUYDWLRQ ’ DWH DXWRP DWLFDOO\ FDOODEOH TXDUWHUO\ IRUDQ DP RXQWHTXDOWR WKH SULQFLSDODP RXQWSOXV WKH UHOHYDQW&RQWLQJ HQW&RXSRQ 3 D\ P HQWLI WK 2 EVHUYDWLRQ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNLVJ UHDWHUWKDQ RUHTXDOWR RI LWV6 WDUWLQJ 9 DOXH RQ DQ\ &DOO2 EVHUYDWLRQ ’ DWH
$ VVXP LQJ WKH 1 RWHV DUH QRWFDOOHG SULRUWR P DWXULW\ LI DQ\ 8 QGHUO\ LQJ 6 WRFN GHFOLQHV E\ P RUH WKDQ IURP LWV 6 WDUWLQJ 9 DOXH DWP DWXULW\ \ RXULQYHVWP HQWZ LOOEH VXEMHFWWR GRZ QVLG H[ SRVXUH WR GHFUHDVHV LQ WKH YDOXH RI WKH / HDVW3 HUIRUP LQJ 8 QGHUO\ LQJ 6 WRFN Z LWK XS WR RI WKH SULQFLSDODWULVN RWKHUZ LVH DWP DWXULW\ \ RX Z LOOUHFHLYH WKH SULQFLSDODP RXQW$ WP DWXUL\
\ RX Z LOODOVR UHFHLYH D ILQDO&RQWLQJ HQW&RXSRQ 3 D\ P HQWLI WKH 2 EVHUYDWLRQ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNRQ WKH ILQDO2 EVHUYDWLRQ ’ DWH LVJ UHDWHUWKDQ RUHTXDOWR RI LWV6 WDUWLQJ 9 DOXH
$ OOSD\ P HQWV RQ WKH 1 RWHV DUH VXEMHFWWR WKH FUHGLWULVN RI %RI$ ) LQDQFH / / & ‡%RI$ ) LQDQFH· RU WKH ‡,VVXHU· DV LVVXHU RI WKH 1 RWHV DQG %DQN RI $ P HULFD &RUSRUDWLRQ ‡%$ &· RU WK
‡* XDUDQWRU· DVJ XDUDQWRURI WKH 1 RWHV
7 KH 1 RWHVZ LOOQRWEH OLVWHG RQ DQ\ VHFXULWLHVH[ FKDQJ H &8 6 ,3 1 R ) 0
7 KH LQLWLDOHVWLP DWHG YDOXH RI WKH 1 RWHV DV RI WKH SULFLQJ GDWH LV SHU LQ SULQFLSDODP RXQWRI 1 RWHV Z KLFK LV OHVV WKDQ WKH SXEOLF RIIHULQJ SULFH OLVWHG EHORZ 7 KH DFWXD YDOXH RI \ RXU1 RWHV DWDQ\ WLP H Z LOOUHIOHFWP DQ\ IDFWRUV DQG FDQQRWEH SUHGLFWHG Z LWK DFFXUDF\ 6 HH ‡5 LVN ) DFWRUV· EHJ LQQLQJ RQ SDJ H 3 6 RI WKLV SULFLQJ VXSSOHP HQWDQG ‡6 WUXFWXULQJ WKH 1 RWHV· R SDJ H 3 6 RI WKLVSULFLQJ VXSSOHP HQWIRUDGGLWLRQDOLQIRUP DWLRQ
7 KHUH DUH LP SRUWDQWGLIIHUHQFHV EHWZ HHQ WKH 1 RWHV DQG D FRQYHQWLRQDOGHEWVHFXULW\ 3 RWHQWLDOSXUFKDVHUV RI WKH 1 RWHV VKRXOG FRQVLGHUWKH LQIRUP DWLRQ LQ ‡5 LVN ) DFWRUV· EHJ LQQLQJ R SDJ H 3 6 RI WKLV SULFLQJ VXSSOHP HQW SDJ H 3 6 RI WKH DFFRP SDQ\ LQJ SURGXFWVXSSOHP HQWSDJ H 3 6 RI WKH DFFRP SDQ\ LQJ SURVSHFWXV VXSSOHP HQWDQG SDJ H RI WKH DFFRP SDQ\ LQJ SURVSHFWXV
1 RQH RI WKH 6 HFXULWLHV DQG ( [ FKDQJ H &RP P LVVLRQ WKH ‡6 ( &· DQ\ VWDWH VHFXULWLHV FRP P LVVLRQ RUDQ\ RWKHUUHJ XODWRU\ ERG\ KDV DSSURYHG RUGLVDSSURYHG RI WKHVH VHFXULWLHV RUGHWHUP LQHG LI WKL SULFLQJ VXSSOHP HQWDQG WKH DFFRP SDQ\ LQJ SURGXFWVXSSOHP HQWSURVSHFWXVVXSSOHP HQWDQG SURVSHFWXVLVWUXWKIXORUFRP SOHWH $ Q\ UHSUHVHQWDWLRQ WR WKH FRQWUDU\ LVD ▇▇▇▇ LQDORIIHQVH
3 XEOLF RIIHULQJ SULFH | 8 QGHUZ ULWLQJ GLVFRXQW | 3 URFHHGV EHIRUH H[ SHQVHV WR %RI$ ) LQDQFH | |
3 HU1 RWH | |||
7RWDO |
&HUWDLQ GHDOHUV Z KR SXUFKDVH WKH 1 RWHV IRUVDOH WR FHUWDLQ IHH EDVHG DGYLVRU\ DFFRXQWV P D\ IRUJ R VRP H RUDOORI WKHLUVHOOLQJ FRQFHVVLRQV IHHV RUFRP P LVVLRQV 7 KH SXEOLF RIIHULQJ SULFH IR LQYHVWRUVSXUFKDVLQJ WKH 1 RWHVLQ WKHVH IHH EDVHG DGYLVRU\ DFFRXQWVP D\ EH DVORZ DV SHU LQ SULQFLSDODP RXQWRI 1 RWHV
7 KH XQGHUZ ULWLQJ GLVFRXQWSHU LQ SULQFLSDODP RXQWRI 1 RWHV P D\ EH DV KLJ K DV UHVXOWLQJ LQ SURFHHGV EHIRUH H[ SHQVHV WR %RI$ ) LQDQFH RI DV ORZ DV SHU L SULQFLSDODP RXQWRI 1 RWHV 7 KH WRWDOXQGHUZ ULWLQJ GLVFRXQWDQG SURFHHGV EHIRUH H[ SHQVHV WR %RI$ ) LQDQFH VSHFLILHG DERYH UHIOHFWWKH DJ J UHJ DWH RI WKH XQGHUZ ULWLQJ GLVFRXQWV SHU L SULQFLSDODP RXQWRI 1 RWHV
,Q DGGLWLRQ WR WKH XQGHUZ ULWLQJ GLVFRXQWDERYH LI DQ\ DQ DIILOLDWH RI %RI$ ) LQDQFH Z LOOSD\ D UHIHUUDOIHH RI XS ▇▇ ▇▇▇ LQ SULQFLSDODP RXQWRI WKH 1 RWHV LQ FRQQHFWLRQ Z LWK WK GLVWULEXWLRQ RI WKH 1 RWHVWR RWKHUUHJ LVWHUHG EURNHUGHDOHUV
7 KH 1 RWHV DQG WKH UHODWHG J XDUDQWHH
$ UH 1 RW) ’ ,& ,QVXUHG | $ UH 1 RW%DQN* XDUDQWHHG | 0 D\ / RVH 9 DOXH |
6 HOOLQJ $ J HQW
7HUP VRI WKH 1 RWHV
,VVXHU %RI$ ) LQDQFH
* XDUDQWRU %$ &
’ HQRP LQDWLRQV 7 KH 1 RWHVZ LOOEH LVVXHG LQ P LQLP XP GHQRP LQDWLRQVRI DQG Z ▇▇▇▇ P XOWLSOHVRI LQ H[ FHVVWKHUHRI
7HUP $ SSUR[ LP DWHO\ \ HDUV XQOHVVSUHYLRXVO\ DXWRP DWLFDOO\ FDOOHG
8 QGHUO\ LQJ 6 WRFNV
7 KH FRP P RQ VWRFNRI $ UFKHU’ DQLHOV 0 LGODQG &RP SDQ\ 1 HZ <RUN6 WRFN( [ FKDQJ H V\ P ERO‡$ ’ 0 · WKH FRP P RQ VWRFNRI ’ HHUH &RP SDQ\ 1 HZ <RUN6 WRFN( [ FKDQJ H V\ P ERO‡’ ( · DQG WKH FRP P RQ VWRFNRI 7 KH : DOW’ LVQH\ &RP SDQ\ 1 HZ <RUN6 WRFN( [ FKDQJ H V\ P ERO‡’ ,6 ·
3 ULFLQJ ’ DWH 2 FWREHU
,VVXH ’ DWH 2 FWREHU
9 DOXDWLRQ ’ DWH
2 FWREHU VXEMHFWWR SRVWSRQHP HQWDVGHVFULEHG XQGHU‡’ HVFULSWLRQ RI WKH 1 RWHV† &HUWDLQ 7HUP VRI WKH 1 RWHV† ( YHQWV5 HODWLQJ WR 2 EVHUYDWLRQ ’ DWHV· LQ WKH DFFRP SDQ\ LQJ SURGXFWVXSSOHP HQW
0 DWXULW\ ’ DWH 2 FWREHU
6 WDUWLQJ 9 DOXH
$ ’ 0
’ (
’ ,6
2 EVHUYDWLRQ 9 DOXH
: LWK UHVSHFWWR HDFK 8 QGHUO\ LQJ 6 WRFN LWV&ORVLQJ 0 DUNHW3 ULFH RQ WKH DSSOLFDEOH 2 EVHUYDWLRQ ’ DWH RU&DOO2 EVHUYDWLRQ ’ DWH DVDSSOLFDEOH P XOWLSOLHG E\ LWV3 ULFH 0 XOWLSOLHU
( QGLQJ 9 DOXH : LWK UHVSHFWWR HDFK 8 QGHUO\ LQJ 6 WRFN LWV2 EVHUYDWLRQ 9 DOXH RQ WKH 9 DOXDWLRQ ’ DWH
&DOO9 DOXH
$ ’ 0 Z KLFK LV RI LWV6 WDUWLQJ 9 DOXH ’ ( Z KLFK LV RI LWV6 WDUWLQJ 9 DOXH ’ ,6 Z KLFK LV RI LWV6 WDUWLQJ 9 DOXH
3 ULFH 0 XOWLSOLHU
: LWK UHVSHFWWR HDFK 8 QGHUO\ LQJ 6 WRFN VXEMHFWWR DGMXVWP HQWIRUFHUWDLQ FRUSRUDWH HYHQWVUHODWLQJ WR WKDW8 QGHUO\ LQJ 6 WRFNDVGHVFULEHG LQ ‡’ HVFULSWLRQ RI WKH 1 RWHV†
$ QWL’ LOXWLRQ$ GMXVWP HQWV· EHJ LQQLQJ RQ SDJ H 3 6 RI WKH DFFRP SDQ\ LQJ SURGXFWVXSSOHP HQW
&RXSRQ %DUULHU
$ ’ 0 Z KLFK LV RI LWV6 WDUWLQJ 9 DOXH URXQGHG WR WZ R GHFLP DOSODFHV ’ ( Z KLFK LV RI LWV6 WDUWLQJ 9 DOXH URXQGHG WR WZ R GHFLP DOSODFHV ’ ,6 Z KLFK LV RI LWV6 WDUWLQJ 9 DOXH
7 KUHVKROG 9 DOXH
$ ’ 0 Z KLFK LV RI LWV6 WDUWLQJ 9 DOXH URXQGHG WR WZ R GHFLP DOSODFHV ’ ( Z KLFK LV RI LWV6 WDUWLQJ 9 DOXH URXQGHG WR WZ R GHFLP DOSODFHV ’ ,6 Z KLFK LV RI LWV6 WDUWLQJ 9 DOXH
&RQWLQJ HQW&RXSRQ 3 D\ P HQWZ LWK
0 HP RU\ ) HDWXUH
,I RQ DQ\ TXDUWHUO\ 2 EVHUYDWLRQ ’ DWH WKH 2 EVHUYDWLRQ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNLVJ UHDWHUWKDQ RUHTXDOWR LWV&RXSRQ %DUULHU Z H Z LOOSD\ D &RQWLQJ HQW&RXSRQ
3 D\ P HQWSHU LQ SULQFLSDODP RXQWRI 1 RWHVRQ WKH DSSOLFDEOH &RQWLQJ HQW3 D\ P HQW’ DWH LQFOXGLQJ WKH 0 DWXULW\ ’ DWH HTXDOWR L WKH SURGXFWRI WLP HVWKH QXP EHURI &RQWLQJ HQW3 D\ P HQW’ DWHVWKDWKDYH RFFXUUHG XS WR WKH UHOHYDQW&RQWLQJ HQW3 D\ P HQW’ DWH LQFOXVLYH RI WKH UHOHYDQW&RQWLQJ HQW3 D\ P HQW’ DWH P LQXV LL WKH VXP RI DOO&RQWLQJ HQW&RXSRQ 3 D\ P HQWVSUHYLRXVO\ SDLG
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
$ XWRP DWLF &DOO
%HJ LQQLQJ Z LWK WKH$ SULO &DOO2 EVHUYDWLRQ ’ DWH DOO EXWQRWOHVVWKDQ ▇▇▇ ▇▇ WKH 1 RWHVZ LOOEH DXWRP DWLFDOO\ FDOOHG LI WKH 2 EVHUYDWLRQ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNLVJ UHDWHUWKDQ RUHTXDOWR LWV&DOO9 DOXH RQ DQ\ &DOO2 EVHUYDWLRQ ’ DWH ,I WKH 1 RWHVDUH DXWRP DWLFDOO\ FDOOHG WKH ( DUO\ 5 HGHP SWLRQ$ P RXQWZ LOOEH SDLG RQ WKH DSSOLFDEOH &DOO3 D\ P HQW’ DWH 1 R IXUWKHUDP RXQWVZ LOOEH SD\ DEOH IROORZ LQJ DQ$ XWRP DWLF &DOO
( DUO\ 5 HGHP SWLRQ
$ P RXQW
) RUHDFK LQ SULQFLSDODP RXQWRI 1 RWHV SOXVWKH DSSOLFDEOH &RQWLQJ HQW&RXSRQ 3 D\ P HQW
5 HGHP SWLRQ $ P RXQW ,I WKH 1 RWHVKDYH QRWEHHQ DXWRP DWLFDOO\ FDOOHG SULRUWR P DWXULW\ WKH 5 HGHP SWLRQ$ P RXQWSHU LQ SULQFLSDODP RXQWRI 1 RWHVZ LOOEH D ,I WKH ( QGLQJ 9 DOXH RI WKH / HDVW3 HUIRUP LQJ 8 QGHUO\ LQJ 6 WRFNLVJ UHDWHUWKDQ RUHTXDOWR LWV7 KUHVKROG 9 DOXH
E ,I WKH ( QGLQJ 9 DOXH RI WKH / HDVW3 HUIRUP LQJ 8 QGHUO\ LQJ 6 WRFNLVOHVVWKDQ LWV7 KUHVKROG 9 DOXH
,Q WKLVFDVH WKH 5 HGHP SWLRQ$ P RXQWH[ FOXGLQJ DQ\ ILQDO&RQWLQJ HQW&RXSRQ 3 D\ P HQWZ LOOEH OHVVWKDQ RI WKH SULQFLSDODP RXQWDQG \ RX FRXOG ORVH XS WR RI \ RXULQYHVWP HQWLQ WKH 1 RWHV
7 KH 5 HGHP SWLRQ$ P RXQWZ LOODOVR LQFOXGH D ILQDO&RQWLQJ HQW&RXSRQ 3 D\ P HQWLI WKH ( QGLQJ 9 DOXH RI WKH / HDVW3 HUIRUP LQJ 8 QGHUO\ LQJ 6 WRFNLVJ UHDWHUWKDQ RUHTXDOWR LWV &RXSRQ %DUULHU
2 EVHUYDWLRQ ’ DWHV $ VVHWIRUWK EHJ LQQLQJ RQ SDJ H 3 6
&RQWLQJ HQW3 D\ P HQW ’ DWHV
$ VVHWIRUWK EHJ LQQLQJ RQ SDJ H 3 6
&DOO2 EVHUYDWLRQ ’ DWHV
$ VVHWIRUWK EHJ LQQLQJ RQ SDJ H 3 6
&DOO3 D\ P HQW’ DWHV $ VVHWIRUWK EHJ LQQLQJ RQ SDJ H 3 6 ( DFK &DOO3 D\ P HQW’ DWH LVDOVR D &RQWLQJ HQW3 D\ P HQW’ DWH
&DOFXODWLRQ $ J HQW %RI$ 6 HFXULWLHV ,QF ‡%RI$ 6 · DQ DIILOLDWH RI %RI$ ) LQDQFH
6 HOOLQJ $ J HQW %RI$ 6
&8 6 ,3 ) 0
8 QGHUO\ LQJ 6 WRFN
5 HWXUQ
: LWK UHVSHFWWR HDFK 8 QGHUO\ LQJ 6 WRFN
/ HDVW3 HUIRUP LQJ 8 QGHUO\ LQJ 6 WRFN
( YHQWV RI ’ HIDXOWDQG
$ FFHOHUDWLRQ
7 KH 8 QGHUO\ LQJ 6 WRFNZ LWK WKH ORZ HVW8 QGHUO\ LQJ 6 WRFN5 HWXUQ
,I DQ ( YHQWRI ’ HIDXOWDVGHILQHG LQ WKH VHQLRULQGHQWXUH UHODWLQJ WR WKH 1 RWHVDQG LQ WKH VHFWLRQ HQWLWOHG ‡’ HVFULSWLRQ RI ’ HEW6 HFXULWLHVRI %RI$ ) LQDQFH / / &† ( YHQWVRI ’ HIDXOWDQG 5 LJ KWVRI $ FFHOHUDWLRQ &RYHQDQW%UHDFKHV· RQ SDJ H RI WKH DFFRP SDQ\ LQJ SURVSHFWXV Z LWK UHVSHFWWR WKH 1 RWHVRFFXUVDQG LVFRQWLQXLQJ WKH DP RXQW SD\ DEOH WR D KROGHURI WKH 1 RWHVXSRQ DQ\ DFFHOHUDWLRQ SHUP LWWHG XQGHUWKH VHQLRULQGHQWXUH Z LOOEH HTXDOWR WKH DP RXQWGHVFULEHG XQGHUWKH FDSWLRQ
‡5 HGHP SWLRQ$ P RXQW· DERYH FDOFXODWHG DVWKRXJ K WKH GDWH RI DFFHOHUDWLRQ Z HUH WKH 0 DWXULW\ ’ DWH RI WKH 1 RWHVDQG DVWKRXJ K WKH 9 DOXDWLRQ ’ DWH Z HUH WKH WKLUG 7 UDGLQJ
’ D\ SULRUWR WKH GDWH RI DFFHOHUDWLRQ : H Z LOODOVR GHWHUP LQH Z KHWKHUD ILQDO&RQWLQJ HQW&RXSRQ 3 D\ P HQWLVSD\ DEOH EDVHG XSRQ WKH SULFHVRI WKH 8 QGHUO\ LQJ 6 WRFNVRQ WKH GHHP HG 9 DOXDWLRQ ’ DWH DQ\ VXFK ILQDO&RQWLQJ HQW&RXSRQ 3 D\ P HQWZ LOOEH SURUDWHG E\ WKH FDOFXODWLRQ DJ HQWWR UHIOHFWWKH OHQJ WK RI WKH ILQDOFRQWLQJ HQWSD\ P HQWSHULRG ,Q FDVH RI D GHIDXOWLQ WKH SD\ P HQWRI WKH 1 RWHV Z KHWKHUDWWKHLUP DWXULW\ RUXSRQ DFFHOHUDWLRQ WKH 1 RWHVZ LOOQRWEHDUD GHIDXOWLQWHUHVWUDWH
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
2 EVHUYDWLRQ ’ DWHV &RQWLQJ HQW3 D\ P HQW’ DWHV &DOO2 EVHUYDWLRQ ’ DWHVDQG &DOO3 D\ P HQW ’ DWHV
2 EVHUYDWLRQ ’ DWHV | &RQWLQJ HQW3 D\ P HQW’ DWHV |
- DQXDU\ | - DQXDU\ |
$ SULO | $ SULO |
- XO\ | - XO\ |
2 FWREHU | 2 FWREHU |
- DQXDU\ | - DQXDU\ |
$ SULO | $ SULO |
- XO\ | - XO\ |
2 FWREHU | 2 FWREHU |
- DQXDU\ | - DQXDU\ |
$ SULO | $ SULO |
- XO\ | - XO\ |
2 FWREHU WKH ‡9 DOXDWLRQ ’ DWH· | 2 FWREHU WKH ‡0 DWXULW\ ’ DWH· |
7 KH 2 EVHUYDWLRQ ’ DWHVDUH VXEMHFWWR SRVWSRQHP HQWDVVHWIRUWK LQ ‡’ HVFULSWLRQ RI WKH 1 RWHV† &HUWDLQ 7HUP VRI WKH 1 RWHV† ( YHQWV5 HODWLQJ WR 2 EVHUYDWLRQ ’ DWHV· RQ SDJ H 3 6 RI WKH DFFRP SDQ\ LQJ SURGXFWVXSSOHP HQW
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
&DOO2 EVHUYDWLRQ ’ DWHV | &DOO3 D\ P HQW’ DWHV |
$ SULO | $ SULO |
- XO\ | - XO\ |
2 FWREHU | 2 FWREHU |
- DQXDU\ | - DQXDU\ |
$ SULO | $ SULO |
- XO\ | - XO\ |
2 FWREHU | 2 FWREHU |
- DQXDU\ | - DQXDU\ |
$ SULO | $ SULO |
- XO\ | - XO\ |
7 KH &DOO2 EVHUYDWLRQ ’ DWHVDUH VXEMHFWWR SRVWSRQHP HQWDVVHWIRUWK LQ ‡’ HVFULSWLRQ RI WKH 1 RWHV† &HUWDLQ 7HUP VRI WKH 1 RWHV† ( YHQWV5 HODWLQJ WR 2 EVHUYDWLRQ ’ DWHV· RQ SDJ H 3 6 RI WKH DFFRP SDQ\ LQJ SURGXFWVXSSOHP HQWZ LWK UHIHUHQFHVWR ‡2 EVHUYDWLRQ ’ DWHV· EHLQJ UHDG DVUHIHUHQFHVWR ‡&DOO2 EVHUYDWLRQ ’ DWHV·
$ Q\ SD\ P HQWVRQ WKH 1 RWHVGHSHQG RQ WKH FUHGLWULVNRI %RI$ ) LQDQFH DV,VVXHU DQG %$ & DV* XDUDQWRU DQG RQ WKH SHUIRUP DQFH RI WKH 8 QGHUO\ LQJ 6 WRFNV 7 KH HFRQRP LF WHUP VRI WKH 1 RWHVDUH EDVHG RQ %$ &¶VLQWHUQDOIXQGLQJ UDWH Z KLFK LVWKH UDWH LWZ RXOG SD\ WR ERUURZ IXQGVWKURXJ K WKH LVVXDQFH RI P DUNHWOLQNHG QRWHV DQG WKH HFRQRP LF WHUP VRI FHUWDLQ UHODWHG KHGJ LQJ DUUDQJ HP HQWV
%$ &¶VDIILOLDWHVHQWHULQWR %$ &¶VLQWHUQDOIXQGLQJ UDWH LVW\ SLFDOO\ ORZ HUWKDQ WKH UDWH LWZ RXOG SD\ Z KHQ LWLVVXHVFRQYHQWLRQDOIL[ HG RUIORDWLQJ UDWH GHEWVHFXULWLHV 7 KLVGLIIHUHQFH LQ IXQGLQJ UDWH DVZ HO DVWKH XQGHUZ ULWLQJ GLVFRXQWLI DQ\ WKH UHIHUUDOIHH DQG WKH KHGJ LQJ UHODWHG FKDUJ HVGHVFULEHG EHORZ VHH ‡5 LVN) DFWRUV· EHJ LQQLQJ RQ SDJ H 3 6 UHGXFHG WKH HFRQRP LF WHUP VRI WKH 1 RWHVWR \ RX DQG WKH LQLWLDOHVWLP DWHG YDOXH RI WKH 1 RWHV ’ XH WR WKHVH IDFWRUV WKH SXEOLF RIIHULQJ SULFH \ RX DUH SD\ LQJ WR SXUFKDVH WKH 1 RWHVLVJ UHDWHUWKDQ WKH LQLWLDOHVWLP DWHG YDOXH RI WKH 1 RWHVDVRI WKH SULFLQJ GDWH
7 KH LQLWLDOHVWLP DWHG YDOXH RI WKH 1 RWHVDVRI WKH SULFLQJ GDWH LVVHWIRUWK RQ WKH FRYHUSDJ H RI WKLVSULFLQJ VXSSOHP HQW) ▇▇▇ ▇▇▇ LQIRUP DWLRQ DERXWWKH LQLWLDOHVWLP DWHG YDOXH DQG WKH VWUXFWXULQJ RI WKH
1 RWHV VHH ‡5 LVN) DFWRUV· EHJ LQQLQJ RQ SDJ H 3 6 DQG ‡6 WUXFWXULQJ WKH 1 RWHV· RQ SDJ H 3 6
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
&RQWLQJ HQW&RXSRQ 3 D\ P HQWDQG 5 HGHP SWLRQ$ P RXQW’ HWHUP LQDWLRQ
2 Q HDFK &RQWLQJ HQW3 D\ P HQW’ DWH LI WKH 1 RWHV KDYH QRWEHHQ SUHYLRXVO\ FDOOHG \ RX P D\ UHFHLYH D &RQWLQJ HQW&RXSRQ 3 D\ P HQWSHU LQ SULQFLSDODP RXQWRI 1 RWHV GHWHUP LQHG DV IROORZ V
$ VVXP LQJ WKH 1 RWHV KDYH QRWEHHQ DXWRP DWLFDOO\ FDOOHG RQ WKH 0 DWXULW\ ’ DWH \ RX Z LOOUHFHLYH D FDVK SD\ P HQWSHU LQ SULQFLSDODP RXQWRI 1 RWHV GHWHUP LQHG DV IROORZ V
$ OOSD\ P HQWVGHVFULEHG DERYH DUH VXEMHFWWR WKH FUHGLWULVNRI %RI$ ) LQDQFH DV,VVXHU DQG %$ & DV* XDUDQWRU
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
7RWDO&RQWLQJ HQW&RXSRQ 3 D\ P HQW( [ DP SOHV
7 KH H[ DP SOHVEHORZ LOOXVWUDWH WKH K\ SRWKHWLFDOWRWDO&RQWLQJ HQW&RXSRQ 3 D\ P HQWVSHU LQ SULQFLSDODP RXQWRI 1 RWHVRYHUWKH WHUP RI WKH 1 RWHV EDVHG RQ WKH &RQWLQJ HQW&RXSRQ 3 D\ P HQW SHU LQ SULQFLSDODP RXQWRI 1 RWHVHTXDOWR L WKH SURGXFWRI WLP HVWKH QXP EHURI &RQWLQJ HQW3 D\ P HQW’ DWHVWKDWKDYH RFFXUUHG XS WR WKH UHOHYDQW&RQWLQJ HQW3 D\ P HQW’ DWH LQFOXVLY RI WKH UHOHYDQW&RQWLQJ HQW3 D\ P HQW’ DWH P LQXV LL WKH VXP RI DOO&RQWLQJ HQW&RXSRQ 3 D\ P HQWVSUHYLRXVO\ SDLG ’ HSHQGLQJ RQ WKH SHUIRUP DQFH RI WKH 8 QGHUO\ LQJ 6 WRFNV \ RX P D\ QRWUHFHLYH DQ\ &RQWLQJ HQW&RXSRQ 3 D\ P HQWVGXULQJ WKH WHUP RI WKH 1 RWHV
( [ ▇▇ ▇▇▇ – 7 KH 2 EVHUYDWLRQ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNRQ WKH ILUVW2 EVHUYDWLRQ ’ DWH LVEHORZ LWV&RXSRQ %DUULHU 7 KHUHIRUH QR &RQWLQJ HQW&RXSRQ 3 D\ P HQWZ LOOEH SDLG RQ WKH DSSOLFDEOH &RQWLQJ HQW3 D\ P HQW’ DWH 7 KH 2 EVHUYDWLRQ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNRQ WKH VHFRQG 2 EVHUYDWLRQ ’ DWH Z KLFK LVDOVR WKH ILUVW&DOO2 EVHUYDWLRQ ’ DWH LVDERYH LWV&RXSRQ %DUULHUEXWEHORZ LWV &DOO9 DOXH 7 KHUHIRUH D &RQWLQJ HQW&RXSRQ 3 D\ P HQWZ LOOEH SDLG RQ WKH DSSOLFDEOH &RQWLQJ HQW3 D\ P HQW’ DWH EXWWKH 1 RWHVZ LOOQRWEH DXWRP DWLFDOO\ FDOOHG 7 KH &RQWLQJ HQW&RXSRQ 3 D\ P HQWSHU
LQ SULQFLSDODP RXQWRI 1 RWHVGXH RQ WKH UHODWHG &RQWLQJ HQW3 D\ P HQW’ DWH Z LOOEH FDOFXODWHG DVIROORZ V
L WKH SURGXFWRI WLP HVWKH QXP EHURI &RQWLQJ HQW3 D\ P HQW’ DWHVWKDWKDYH RFFXUUHG XS WR WKH UHOHYDQW&RQWLQJ HQW3 D\ P HQW’ DWH LQFOXVLYH RI WKH UHOHYDQW&RQWLQJ HQW3 D\ P HQW ’ DWH P LQXV LL WKH VXP RI DOO&RQWLQJ HQW&RXSRQ 3 D\ P HQWVSUHYLRXVO\ SDLG
L [ LL SHU LQ SULQFLSDODP RXQWRI 1 RWHV
7 KH 2 EVHUYDWLRQ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNRQ WKH WKLUG 2 EVHUYDWLRQ ’ DWH Z KLFK LVDOVR D &DOO2 EVHUYDWLRQ ’ DWH LVDERYH LWV&RXSRQ %DUULHUDQG LWV&DOO9 DOXH 7 KHUHIRUH WKH 1 RWHVZ LOOEH DXWRP DWLFDOO\ FDOOHG DQG WKH &RQWLQJ HQW&RXSRQ 3 D\ P HQWSHU LQ SULQFLSDODP RXQWRI 1 RWHVRWKHUZ LVH GXH RQ WKH UHODWHG &RQWLQJ HQW3 D\ P HQW’ DWH Z LOOEH FDOFXODWHG DVIROORZ V
L WKH SURGXFWRI WLP HVWKH QXP EHURI &RQWLQJ HQW3 D\ P HQW’ DWHVWKDWKDYH RFFXUUHG XS WR WKH UHOHYDQW&RQWLQJ HQW3 D\ P HQW’ DWH LQFOXVLYH RI WKH UHOHYDQW&RQWLQJ HQW3 D\ P HQW ’ DWH P LQXV LL WKH VXP RI DOO&RQWLQJ HQW&RXSRQ 3 D\ P HQWVSUHYLRXVO\ SDLG
L [ LL SHU LQ SULQFLSDODP RXQWRI 1 RWHV
2 Q WKH DSSOLFDEOH &RQWLQJ HQW3 D\ P HQW’ DWH Z KLFK LVDOVR WKH &DOO3 D\ P HQW’ DWH \ RX Z LOOUHFHLYH SHU LQ SULQFLSDODP RXQWRI 1 RWHV DQG QR IXUWKHUDP RXQWVZ LOOEH SD\ DEOH RQ WKH 1 RWHVIROORZ LQJ DQ$ XWRP DWLF &DOO
( [ ▇▇ ▇▇▇ – 7 KH 2 EVHUYDWLRQ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNRQ WKH ILUVW2 EVHUYDWLRQ ’ DWH LVEHORZ LWV&RXSRQ %DUULHU 7 KHUHIRUH QR &RQWLQJ HQW&RXSRQ 3 D\ P HQWZ LOOEH SDLG RQ WKH DSSOLFDEOH &RQWLQJ HQW3 D\ P HQW’ DWHV 7 KH 2 EVHUYDWLRQ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNRQ WKH VHFRQG 2 EVHUYDWLRQ ’ DWH Z KLFK LVDOVR WKH ILUVW&DOO2 EVHUYDWLRQ ’ DWH LVEHORZ LWV&RXSRQ %DUULHUDQG LWV&DOO 9 DOXH 7 KHUHIRUH QR &RQWLQJ HQW&RXSRQ 3 D\ P HQWZ LOOEH SDLG RQ WKH DSSOLFDEOH &RQWLQJ HQW3 D\ P HQW’ DWH DQG WKH 1 RWHVZ LOOQRWEH DXWRP DWLFDOO\ FDOOHG 7 KH 2 EVHUYDWLRQ 9 DOXH RI HDFK 8 QGHUO\ LQJ
6 WRFNRQ WKH WKLUG 2 EVHUYDWLRQ ’ DWH Z KLFK LVDOVR D &DOO2 EVHUYDWLRQ ’ DWH LVDERYH LWV&RXSRQ %DUULHUDQG LWV&DOO9 DOXH 7 KHUHIRUH WKH 1 RWHVZ LOOEH DXWRP DWLFDOO\ FDOOHG DQG WKH &RQWLQJ HQW&RXSR
3 D\ P HQWSHU LQ SULQFLSDODP RXQWRI 1 RWHVGXH RQ WKH UHODWHG &RQWLQJ HQW3 D\ P HQW’ DWH Z LOOEH FDOFXODWHG DVIROORZ V
L WKH SURGXFWRI WLP HVWKH QXP EHURI &RQWLQJ HQW3 D\ P HQW’ DWHVWKDWKDYH RFFXUUHG XS WR WKH UHOHYDQW&RQWLQJ HQW3 D\ P HQW’ DWH LQFOXVLYH RI WKH UHOHYDQW&RQWLQJ HQW3 D\ P HQW ’ DWH P LQXV LL WKH VXP RI DOO&RQWLQJ HQW&RXSRQ 3 D\ P HQWVSUHYLRXVO\ SDLG
L [ LL SHU LQ SULQFLSDODP RXQWRI 1 RWHV
2 Q WKH DSSOLFDEOH &RQWLQJ HQW3 D\ P HQW’ DWH Z KLFK LVDOVR WKH &DOO3 D\ P HQW’ DWH \ RX Z LOOUHFHLYH SHU LQ SULQFLSDODP RXQWRI 1 RWHV DQG QR IXUWKHUDP RXQWVZ LOOEH SD\ DEOH RQ WKH 1 RWHVIROORZ LQJ DQ$ XWRP DWLF &DOO
( [ ▇▇ ▇▇▇ – 7 KH 2 EVHUYDWLRQ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNRQ WKH ILUVW2 EVHUYDWLRQ ’ DWH LVDERYH LWV&RXSRQ %DUULHU 7 KHUHIRUH D &RQWLQJ HQW&RXSRQ 3 D\ P HQWLQ WKH DP RXQWRI SHU
LQ SULQFLSDODP RXQWRI 1 RWHVZ LOOEH SDLG RQ HDFK DSSOLFDEOH &RQWLQJ HQW3 D\ P HQW’ DWH 7 KH 2 EVHUYDWLRQ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNRQ WKH VHFRQG 2 EVHUYDWLRQ ’ DWH Z KLFK LVDOVR WKH ILUVW&DOO2 EVHUYDWLRQ ’ DWH LVDERYH LWV&RXSRQ %DUULHUEXWEHORZ LWV&DOO9 DOXH 7 KHUHIRUH D &RQWLQJ HQW&RXSRQ 3 D\ P HQWZ LOOEH SDLG RQ WKH DSSOLFDEOH &RQWLQJ HQW3 D\ P HQW’ DWH EXWWKH 1 RWHVZ LOO QRWEH DXWRP DWLFDOO\ FDOOHG 7 KH &RQWLQJ HQW&RXSRQ 3 D\ P HQWSHU LQ SULQFLSDODP RXQWRI 1 RWHVGXH RQ WKH UHODWHG &RQWLQJ HQW3 D\ P HQW’ DWH Z LOOEH FDOFXODWHG DVIROORZ V
L WKH SURGXFWRI WLP HVWKH QXP EHURI &RQWLQJ HQW3 D\ P HQW’ DWHVWKDWKDYH RFFXUUHG XS WR WKH UHOHYDQW&RQWLQJ HQW3 D\ P HQW’ DWH LQFOXVLYH RI WKH UHOHYDQW&RQWLQJ HQW3 D\ P HQW ’ DWH P LQXV LL WKH VXP RI DOO&RQWLQJ HQW&RXSRQ 3 D\ P HQWVSUHYLRXVO\ SDLG
L [ LL [ SHU LQ SULQFLSDODP RXQWRI 1 RWHV
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
7 KH 2 EVHUYDWLRQ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNRQ HDFK RI WKH WKLUG WKURXJ K HOHYHQWK 2 EVHUYDWLRQ ’ DWHV Z KLFK DUH DOVR &DOO2 EVHUYDWLRQ ’ DWHV LVDERYH LWV&RXSRQ %DUULHUEXWEHORZ LWV&DOO9 DOXH
7 KHUHIRUH D &RQWLQJ HQW&RXSRQ 3 D\ P HQWLQ WKH DP RXQWRI SHU LQ SULQFLSDODP RXQWRI 1 RWHVZ LOOEH SDLG RQ HDFK DSSOLFDEOH &RQWLQJ HQW3 D\ P HQW’ DWH EXWWKH 1 RWHVZ LOOQRWEH DXWRP DWLFDOO\ FDOOHG 7 KH ( QGLQJ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNRQ WKH 9 DOXDWLRQ ’ DWH LVDERYH LWV&RXSRQ %DUULHUDQG 7 KUHVKROG 9 DOXH 7 KHUHIRUH D &RQWLQJ HQW&RXSRQ 3 D\ P HQWZ LOOEH GXH RQ WKH 0 DWXULW\ ’ DWH FDOFXODWHG DVIROORZ V
L WKH SURGXFWRI WLP HVWKH QXP EHURI &RQWLQJ HQW3 D\ P HQW’ DWHVWKDWKDYH RFFXUUHG XS WR WKH UHOHYDQW&RQWLQJ HQW3 D\ P HQW’ DWH LQFOXVLYH RI WKH UHOHYDQW&RQWLQJ HQW3 D\ P HQW ’ DWH P LQXV LL WKH VXP RI DOO&RQWLQJ HQW&RXSRQ 3 D\ P HQWVSUHYLRXVO\ SDLG
L [ LL [ SHU LQ SULQFLSDODP RXQWRI 1 RWHV 2 Q WKH 0 DWXULW\ ’ DWH \ RX Z LOOUHFHLYH SHU LQ SULQFLSDODP RXQWRI 1 RWHV
( [ ▇▇ ▇▇▇ – 7 KH 2 EVHUYDWLRQ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNRQ WKH ILUVW2 EVHUYDWLRQ ’ DWH LVDERYH LWV&RXSRQ %DUULHU$ &RQWLQJ HQW&RXSRQ 3 D\ P HQWLQ WKH DP RXQWRI SHU LQ SULQFLSDODP RXQWRI 1 RWHVZ LOOEH SDLG RQ HDFK DSSOLFDEOH &RQWLQJ HQW3 D\ P HQW’ DWH 7 KH 2 EVHUYDWLRQ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNRQ HDFK RI WKH VHFRQG WKURXJ K HOHYHQWK 2 EVHUYDWLRQ ’ DWHV
Z KLFK DUH DOVR &DOO2 EVHUYDWLRQ ’ DWHV LVEHORZ LWV&RXSRQ %DUULHUDQG LWV&DOO9 DOXH 7 KHUHIRUH QR &RQWLQJ HQW&RXSRQ 3 D\ P HQWZ LOOEH SDLG RQ DQ\ UHODWHG &RQWLQJ HQW3 D\ P HQW’ DWH DQG WKH 1 RWHV Z LOOQRWEH DXWRP DWLFDOO\ FDOOHG 7 KH ( QGLQJ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNRQ WKH 9 DOXDWLRQ ’ DWH LVEHORZ LWV&RXSRQ %DUULHUDQG 7 KUHVKROG 9 DOXH 7 KHUHIRUH QR &RQWLQJ HQW&RXSRQ 3 D\ P HQWZ LOOEH GXH RQ WKH 0 DWXULW\ ’ DWH DQG \ RX Z LOOUHFHLYH DQ DP RXQWDWP DWXULW\ WKDWZ LOOEH OHVVWKDQ WKH VWDWHG SULQFLSDODP RXQWRI \ RXU1 RWHV DQG FRXOG EH ] HUR
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
+ \ SRWKHWLFDO3 D\ RXW3 URILOH DQG ( [ DP SOHVRI 3 D\ P HQWVDW0 DWXULW\
&RQWLQJ HQW,QFRP H Z LWK 0 HP RU\ ) HDWXUH $ XWR &DOODEOH <LHOG 1 RWHV 7DEOH
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
SHU LQ SULQFLSDODP RXQWRI 1 RWHVDQG D UDQJ H RI K\ SRWKHWLFDO( QGLQJ 9 DOXHVRI WKH / HDVW3 HUIRUP LQJ 8 QGHUO\ LQJ 6 WRFN 7 KH DFWXDODP RXQW\ RX UHFHLYH DQG WKH UHVXOWLQJ UHWXUQ Z LOOGHSHQG RQ WKH DFWXDO6 WDUWLQJ 9 DOXHV &RXSRQ %DUULHUV 7 KUHVKROG 9 DOXHV 2 EVHUYDWLRQ 9 DOXHV DQG ( QGLQJ 9 DOXHV RI WKH 8 QGHUO\ LQJ 6 WRFNV Z KHWKHUWKH 1 RWHV DUH DXWRP DWLFDOO\ FDOOHG SULRUWR P DWXULW\ DQG Z KHWKHU\ RX ▇▇▇▇ WKH 1 RWHV WR P DWXULW\ 7 KH IROORZ LQJ H[ DP SOHVGR QRWWDNH LQWR DFFRXQWDQ\ WD[ FRQVHTXHQFHVIURP LQYHVWLQJ LQ WKH 1 RWHV 7 KH WDEOH EHORZ DOVR DVVXP HVWKDWD &RQWLQJ HQW&RXSRQ 3 D\ P HQWZ DVSDLG RQ HDFK &RQWLQJ HQW3 D\ P HQW’ DWH SULRUWR P DWXULW\
) RUUHFHQWDFWXDOYDOXHVRI WKH 8 QGHUO\ LQJ 6 WRFNV VHH ‡7 KH 8 QGHUO\ LQJ 6 WRFNV· VHFWLRQ EHORZ 7 KH ( QGLQJ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNZ LOOQRWLQFOXGH DQ\ LQFRP H J HQHUDWHG E\ GLYLGHQGVRURWKHU GLVWULEXWLRQVSDLG Z LWK UHVSHFWWR VKDUHVRI WKDW8 QGHUO\ LQJ 6 WRFN ,Q DGGLWLRQ DOOSD\ P HQWVRQ WKH 1 RWHVDUH VXEMHFWWR ,VVXHUDQG * XDUDQWRUFUHGLWULVN
5 HWXUQ RQ WKH 1 RWHV
5 HGHP SWLRQ $ P RXQWSHU1 RWH LQFOXGLQJ DQ\ ILQDO &RQWLQJ HQW&RXSRQ 3 D\ P HQW
8 QGHUO\ LQJ 6 WRFN 5 HWXUQ RI WKH / HDVW
3 HUIRUP LQJ 8 QGHUO\ LQJ 6 WRFN
( QGLQJ 9 DOXH RI WKH / HDVW 3 HUIRUP LQJ 8 QGHUO\ LQJ 6 WRFN
7 KH ‡5 HWXUQ RQ WKH 1 RWHV· LVFDOFXODWHG EDVHG RQ WKH 5 HGHP SWLRQ$ P RXQWDQG SRWHQWLDOILQDO&RQWLQJ HQW&RXSRQ 3 D\ P HQWRI SHU LQ SULQFLSDODP RXQWRI 1 RWHV QRWLQFOXGLQJ DQ\ &RQWLQJ HQW&RXSRQ
3 D\ P HQWVSDLG SULRUWR P DWXULW\ DQG DVVXP HVWKDWWKH UHOHYDQW&RQWLQJ HQW&RXSRQ 3 D\ P HQWKDVEHHQ P DGH RQ HDFK SULRU&RQWLQJ HQW3 D\ P HQW’ DWH
7 KLVDP RXQWUHSUHVHQWVWKH VXP RI WKH SULQFLSDODP RXQWDQG D ILQDOTXDUWHUO\ &RQWLQJ HQW&RXSRQ 3 D\ P HQWRI SHU LQ SULQFLSDODP RXQWRI 1 RWHV DVVXP LQJ WKDWHDFK SULRUTXDUWHUO\ &RQWLQJ HQW&RXSRQ
3 D\ P HQWKDVEHHQ P DGH RQ WKH UHODWHG &RQWLQJ HQW3 D\ P HQW’ DWH
7 KH K\ SRWKHWLFDO6 WDUWLQJ 9 DOXH RI XVHG LQ WKH WDEOH DERYH KDVEHHQ FKRVHQ IRULOOXVWUDWLYH SXUSRVHVRQO\ 7 KH DFWXDO6 WDUWLQJ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNLVVHWIRUWK RQ SDJ H 3 6 DERYH
7 KLVLVWKH K\ SRWKHWLFDO&RXSRQ %DUULHUDQG 7 KUHVKROG 9 DOXH RI WKH / HDVW3 HUIRUP LQJ 8 QGHUO\ LQJ 6 WRFN
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
5 LVN) DFWRUV
<RXULQYHVWP HQWLQ WKH 1 RWHVHQWDLOVVLJ QLILFDQWULVNV P DQ\ RI Z KLFK GLIIHUIURP WKRVH RI D FRQYHQWLRQDOGHEWVHFXULW\ <RXUGHFLVLRQ WR SXUFKDVH WKH 1 RWHVVKRXOG EH P DGH RQO\ DIWHUFDUHIXOO\ FRQVLGHULQJ WKH ULVNVRI DQ LQYHVWP HQWLQ WKH 1 RWHV LQFOXGLQJ WKRVH GLVFXVVHG EHORZ Z LWK \ RXUDGYLVRUVLQ OLJ KWRI \ RXUSDUWLFXODUFLUFXP VWDQFHV 7 KH 1 RWHVDUH QRWDQ DSSURSULDWH LQYHVWP HQWIRU\ RX LI
\ RX DUH QRWNQRZ OHGJ HDEOH DERXWVLJ QLILFDQWHOHP HQWVRI WKH 1 RWHVRUILQDQFLDOP DWWHUVLQ J HQHUDO<RX VKRXOG FDUHIXOO\ UHYLHZ WKH P RUH GHWDLOHG H[ SODQDWLRQ RI ULVNVUHODWLQJ WR WKH 1 RWHVLQ WKH ‡5 LVN
) DFWRUV· VHFWLRQVEHJ LQQLQJ RQ SDJ H 3 6 RI WKH DFFRP SDQ\ LQJ SURGXFWVXSSOHP HQWSDJ H 6 RI WKH DFFRP SDQ\ LQJ SURVSHFWXVVXSSOHP HQWDQG SDJ H RI WKH DFFRP SDQ\ LQJ SURVSHFWXV HDFK DV LGHQWLILHG RQ SDJ H 3 6 EHORZ
6 WUXFWXUH UHODWHG 5 LVNV
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
<RXUUHWXUQ RQ WKH 1 RWHV ▇▇ ▇▇▇ LWHG WR WKH UHWXUQ UHSUHVHQWHG E\ WKH &RQWLQJ HQW&RXSRQ 3 D\ P HQWV LI DQ\ RYHUWKH WHUP RI WKH 1 RWHV <RXUUHWXUQ RQ WKH 1 RWHVLVOLP LWHG WR WKH
&RQWLQJ HQW&RXSRQ 3 D\ P HQWVSDLG RYHUWKH WHUP RI WKH 1 RWHV UHJ DUGOHVVRI WKH H[ WHQWWR Z KLFK WKH 2 EVHUYDWLRQ 9 DOXH RU( QGLQJ 9 DOXH RI DQ\ 8 QGHUO\ LQJ 6 WRFNH[ FHHGVLWV&RXSRQ %DUULHURU 6 WDUWLQJ 9 DOXH DVDSSOLFDEOH 6 LP LODUO\ WKH DP RXQWSD\ DEOH DWP DWXULW\ RUXSRQ DQ$ XWRP DWLF &DOOZ LOOQHYHUH[ FHHG WKH VXP RI WKH SULQFLSDODP RXQWDQG WKH DSSOLFDEOH &RQWLQJ HQW&RXSRQ
3 D\ P HQWUHJ DUGOHVVRI WKH H[ WHQWWR Z KLFK WKH 2 EVHUYDWLRQ 9 DOXH RU( QGLQJ 9 DOXH RI DQ\ 8 QGHUO\ LQJ 6 WRFNH[ FHHGVLWV6 WDUWLQJ 9 DOXH ,Q FRQWUDVWD GLUHFWLQYHVWP HQWLQ WKH 8 QGHUO\ LQJ 6 WRFNV Z RXOG DOORZ \ RX WR UHFHLYH WKH EHQHILWRI DQ\ DSSUHFLDWLRQ LQ WKHLUSULFHV $ Q\ UHWXUQ RQ WKH 1 RWHVZ LOOQRWUHIOHFWWKH UHWXUQ \ RX Z RXOG UHDOL] H LI \ RX DFWXDOO\ RZ QHG VKDUHVRI DQ 8 QGHUO\ LQJ 6 WRFN DQG UHFHLYHG WKH GLYLGHQGVSDLG RUGLVWULEXWLRQVP DGH RQ WKHP
7 KH 1 RWHV DUH VXEMHFWWR D SRWHQWLDO$ XWRP DWLF &DOO Z KLFK Z RXOG ▇▇▇ ▇▇\ RXUDELOLW\ WR UHFHLYH WKH &RQWLQJ HQW&RXSRQ 3 D\ P HQWV RYHUWKH IXOOWHUP RI WKH 1 RWHV 7 KH 1 RWHVDUH VXEMHF WR D SRWHQWLDO$ XWRP DWLF &DOO%HJ LQQLQJ Z LWK WKH$ SULO &DOO2 EVHUYDWLRQ ’ DWH WKH 1 RWHVZ LOOEH DXWRP DWLFDOO\ FDOOHG LI RQ DQ\ &DOO2 EVHUYDWLRQ ’ DWH WKH 2 EVHUYDWLRQ 9 DOXH RI HDFK
8 QGHUO\ LQJ 6 WRFNLVJ UHDWHUWKDQ RUHTXDOWR LWV&DOO9 DOXH ,I WKH 1 RWHVDUH DXWRP DWLFDOO\ FDOOHG SULRUWR WKH 0 DWXULW\ ’ DWH \ RX Z LOOEH HQWLWOHG WR UHFHLYH WKH ( DUO\ 5 HGHP SWLRQ$ P RXQWRQ WKH DSSOLFDEOH &DOO3 D\ P HQW’ DWH DQG QR IXUWKHUDP RXQWVZ LOOEH SD\ DEOH RQ WKH 1 RWHV ,Q WKLVFDVH \ RX Z LOOORVH WKH RSSRUWXQLW\ WR FRQWLQXH WR UHFHLYH &RQWLQJ HQW&RXSRQ 3 D\ P HQWVDIWHUWKH GDWH RI WKH$ XWRP DWLF &DOO,I WKH 1 RWHVDUH FDOOHG SULRUWR WKH 0 DWXULW\ ’ DWH \ RX P D\ EH XQDEOH WR LQYHVWLQ RWKHUVHFXULWLHVZ LWK D VLP LODUOHYHORI ULVNWKDWFRXOG SURYLGH D UHWXUQ WKDWLVVLP LODUWR WKH
1 RWHV
<RX P D\ QRWUHFHLYH DQ\ &RQWLQJ HQW&RXSRQ 3 D\ P HQWV 7 KH 1 RWHVGR QRWSURYLGH IRUDQ\ UHJ XODUIL[ HG FRXSRQ SD\ P HQWV ,QYHVWRUVLQ WKH 1 RWHVZ LOOQRWQHFHVVDULO\ UHFHLYH DQ\ &RQWLQJ HQ &RXSRQ 3 D\ P HQWVRQ WKH 1 RWHV ,I WKH 2 EVHUYDWLRQ 9 DOXH RI DQ\ 8 QGHUO\ LQJ 6 WRFNLVOHVVWKDQ LWV&RXSRQ %DUULHURQ DQ 2 EVHUYDWLRQ ’ DWH \ RX Z LOOQRWUHFHLYH WKH &RQWLQJ HQW&RXSRQ 3 D\ P HQW RQ WKH UHODWHG &RXSRQ 3 D\ P HQW’ DWH <RX Z LOOUHFHLYH D SUHYLRXVO\ XQSDLG &RQWLQJ HQW&RXSRQ 3 D\ P HQWRQ D VXEVHTXHQW&RXSRQ 3 D\ P HQW’ DWH RQO\ LI WKH 2 EVHUYDWLRQ 9 DOXH RI HDFK
8 QGHUO\ LQJ 6 WRFNRQ WKH UHODWHG 2 EVHUYDWLRQ ’ DWH LVJ UHDWHUWKDQ RUHTXDOWR LWV&RXSRQ %DUULHU + RZ HYHU LI WKH 2 EVHUYDWLRQ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNRQ DQ 2 EVHUYDWLRQ ’ DWH LVOHVVWKD LWV&RXSRQ %DUULHUDQG WKH 2 EVHUYDWLRQ 9 DOXH RI HDFK 8 QGHUO\ LQJ 6 WRFNRQ HDFK VXEVHTXHQW2 EVHUYDWLRQ ’ DWH XS WR DQG LQFOXGLQJ WKH 9 DOXDWLRQ ’ DWH LVOHVVWKDQ LWV&RXSRQ %DUULHU \ RX Z LOOQR UHFHLYH WKH XQSDLG &RQWLQJ HQW&RXSRQ 3 D\ P HQWVLQ UHVSHFWRI WKRVH 2 EVHUYDWLRQ ’ DWHV ,I WKH 2 EVHUYDWLRQ 9 DOXH RI DQ\ 8 QGHUO\ LQJ 6 WRFNLVOHVVWKDQ LWV&RXSRQ %DUULHURQ DOOWKH 2 EVHUYDWLRQ ’ DWHVGXULQJ WKH WHUP RI WKH 1 RWHV \ RX Z LOOQRWUHFHLYH DQ\ &RQWLQJ HQW&RXSRQ 3 D\ P HQWVGXULQJ WKH WHUP RI WKH 1 RWHV DQG Z LOOQRWUHFHLYH D SRVLWLYH UHWXUQ RQ WKH 1 RWHV
<RXUUHWXUQ RQ WKH 1 RWHV P D\ EH OHVV WKDQ WKH \ LHOG RQ D FRQYHQWLRQDOGHEWVHFXULW\ RI FRP SDUDEOH P DWXULW\ $ Q\ UHWXUQ WKDW\ RX UHFHLYH RQ WKH 1 RWHVP D\ EH OHVVWKDQ WKH UHWXUQ \ RX Z RXOG HDUQ LI \ RX SXUFKDVHG D FRQYHQWLRQDOGHEWVHFXULW\ Z LWK WKH VDP H 0 DWXULW\ ’ DWH $ VD UHVXOW\ RXULQYHVWP HQWLQ WKH 1 RWHVP D\ QRWUHIOHFWWKH IXOORSSRUWXQLW\ FRVWWR \ RX Z KHQ \ RX FRQVLGHUIDFWRUV VXFK DVLQIODWLRQ WKDWDIIHFWWKH WLP H YDOXH RI P RQH\ ,Q DGGLWLRQ LI LQWHUHVWUDWHVLQFUHDVH GXULQJ WKH WHUP RI WKH 1 RWHV WKH &RQWLQJ HQW&RXSRQ 3 D\ P HQWLI DQ\ P D\ EH OHVV WKDQ WKH \ LHOG RQ D FRQYHQWLRQDOGHEWVHFXULW\ RI FRP SDUDEOH P DWXULW\
7 KH &RQWLQJ HQW&RXSRQ 3 D\ P HQW( DUO\ 5 HGHP SWLRQ $ P RXQWRU5 HGHP SWLRQ $ P RXQWDV DSSOLFDEOH Z LOOQRWUHIOHFWFKDQJ HV LQ WKH SULFHV RI WKH 8 QGHUO\ LQJ 6 WRFNV RWKHUWKDQ RQ WKH 2 EVHUYDWLRQ ’ DWHV RU&DOO2 EVHUYDWLRQ ’ DWHV DV DSSOLFDEOH 7 KH SULFHVRI WKH 8 QGHUO\ LQJ 6 WRFNVGXULQJ WKH WHUP RI WKH 1 RWHVRWKHUWKDQ RQ WKH 2 EVHUYDWLRQ ’ DWHVRU&DOO2 EVHUYDWLRQ ’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
DXWRP DWLFDOO\ FDOOHG SULRUWR P DWXULW\ DQG WKH ( QGLQJ 9 DOXH RI WKH / HDVW3 HUIRUP LQJ 8 QGHUO\ LQJ 6 WRFNLVOHVVWKDQ LWV7 KUHVKROG 9 DOXH \ RX Z LOOUHFHLYH OHVVWKDQ WKH SULQFLSDODP RXQWDWP DWXULW\ HYHQ LI WKH SULFH RI HDFK 8 QGHUO\ LQJ 6 WRFNZ DVDOZ D\ VDERYH LWV7 KUHVKROG 9 DOXH SULRUWR WKH 9 DOXDWLRQ ’ DWH
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
%HFDXVH WKH 1 RWHV DUH OLQNHG WR WKH OHDVWSHUIRUP LQJ DQG QRWWKH DYHUDJ H SHUIRUP DQFH RI WKH 8 QGHUO\ LQJ 6 WRFNV \ RX P D\ QRWUHFHLYH DQ\ UHWXUQ RQ WKH 1 RWHV DQG P D\ ORVH D VLJ QLILFDQWSRUWLRQ RUDOORI \ RXULQYHVWP HQWLQ WKH 1 RWHV HYHQ LI WKH 2 EVHUYDWLRQ 9 DOXH RU( QGLQJ 9 DOXH RI RQH 8 QGHUO\ LQJ 6 WRFN LV J UHDWHUWKDQ RUHTXDOWR LWV &RXSRQ %DUULHURU 7 KUHVKROG 9 DOXH DV DSSOLFDEOH <RXU1 RWHVDUH OLQNHG WR WKH OHDVWSHUIRUP LQJ RI WKH 8 QGHUO\ LQJ 6 WRFNV DQG D FKDQJ H LQ WKH SULFH RI RQH 8 QGHUO\ LQJ 6 WRFNP D\ QRWFRUUHODWH Z LWK FKDQJ HVLQ
WKH SULFHVRI WKH RWKHU8 QGHUO\ LQJ 6 WRFNV 7 KH 1 RWHVDUH QRWOLQNHG WR D EDVNHWFRP SRVHG RI WKH 8 QGHUO\ LQJ 6 WRFNV Z KHUH WKH GHSUHFLDWLRQ LQ WKH SULFH RI RQH 8 QGHUO\ LQJ 6 WRFNFRXOG EH RIIVHW WR VRP H H[ WHQWE\ WKH DSSUHFLDWLRQ LQ WKH SULFHVRI WKH RWKHU8 QGHUO\ LQJ 6 WRFNV ,Q WKH FDVH RI WKH 1 RWHV WKH LQGLYLGXDOSHUIRUP DQFH RI HDFK 8 QGHUO\ LQJ 6 WRFNZ RXOG QRWEH FRP ELQHG DQG WKH GHSUHFLDWLRQ LQ WKH SULFH RI RQH 8 QGHUO\ LQJ 6 WRFNZ RXOG QRWEH RIIVHWE\ DQ\ DSSUHFLDWLRQ LQ WKH SULFHVRI WKH RWKHU8 QGHUO\ LQJ 6 WRFNV ( YHQ LI WKH 2 EVHUYDWLRQ 9 DOXH RI DQ 8 QGHUO\ LQJ 6 WRFNLVDW RUDERYH LWV&RXSRQ %DUULHURQ DQ 2 EVHUYDWLRQ ’ DWH \ RX Z LOOQRWUHFHLYH WKH &RQWLQJ HQW&RXSRQ 3 D\ P HQWZ LWK UHVSHFWWR WKDW2 EVHUYDWLRQ ’ DWH LI WKH 2 EVHUYDWLRQ 9 DOXH RI DQRWKHU8 QGHUO\ LQJ
6 WRFNLVEHORZ LWV&RXSRQ %DUULHURQ WKDWGD\ ,Q DGGLWLRQ HYHQ LI WKH ( QGLQJ 9 DOXH RI DQ 8 QGHUO\ LQJ 6 WRFNLVDWRUDERYH LWV7 KUHVKROG 9 DOXH \ RX Z LOOORVH D VLJ QLILFDQWSRUWLRQ RUDOORI \ RXU LQYHVWP HQWLQ WKH 1 RWHVLI WKH ( QGLQJ 9 DOXH RI WKH / HDVW3 HUIRUP LQJ 8 QGHUO\ LQJ 6 WRFNLVEHORZ LWV7 KUHVKROG 9 DOXH
$ Q\ SD\ P HQWV RQ WKH 1 RWHV DUH VXEMHFWWR RXUFUHGLWULVN DQG WKH FUHGLWULVN RI WKH * XDUDQWRU DQG DQ\ DFWXDORUSHUFHLYHG FKDQJ HV LQ RXURUWKH * XDUDQWRU¶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
,Q DGGLWLRQ RXUFUHGLWUDWLQJ VDQG WKH FUHGLWUDWLQJ VRI WKH * XDUDQWRUDUH DVVHVVP HQWVE\ UDWLQJ VDJ HQFLHVRI RXUUHVSHFWLYH DELOLWLHVWR SD\ RXUREOLJ DWLRQV &RQVHTXHQWO\ RXURUWKH * XDUDQWRU¶V SHUFHLYHG FUHGLWZ RUWKLQHVVDQG DFWXDORUDQWLFLSDWHG GHFUHDVHVLQ RXURUWKH * XDUDQWRU¶VFUHGLWUDWLQJ VRULQFUHDVHVLQ WKH VSUHDG EHWZ HHQ WKH \ LHOG RQ RXUUHVSHFWLYH VHFXULWLHVDQG WKH \ LHOG RQ 8 6 7 UHDVXU\ VHFXULWLHV WKH ‡FUHGLWVSUHDG· SULRUWR WKH 0 DWXULW\ ’ DWH P D\ DGYHUVHO\ DIIHFWWKH P DUNHWYDOXH RI WKH 1 RWHV + RZ HYHU EHFDXVH \ RXUUHWXUQ RQ WKH 1 RWHVGHSHQGVXSRQ IDFWRUVLQ DGGLWLRQ WR RXUDELOLW\ DQG WKH DELOLW\ RI WKH * XDUDQWRUWR SD\ RXUUHVSHFWLYH REOLJ DWLRQV VXFK DVWKH SULFHVRI WKH 8 QGHUO\ LQJ 6 WRFNV DQ LP SURYHP HQWLQ RXURUWKH * XDUDQWRU¶VFUHGLWUDWLQJ VZ LOO QRWUHGXFH WKH RWKHULQYHVWP HQWULVNVUHODWHG WR WKH 1 RWHV
: H DUH D ILQDQFH VXEVLGLDU\ DQG DV VXFK KDYH QR LQGHSHQGHQWDVVHWV RSHUDWLRQV RUUHYHQXHV : H DUH D ILQDQFH VXEVLGLDU\ RI WKH * XDUDQWRU KDYH QR RSHUDWLRQVRWKHUWKDQ WKRVH UHODWHG WR WKH LVVXDQFH DGP LQLVWUDWLRQ DQG UHSD\ P HQWRI RXUGHEWVHFXULWLHVWKDWDUH J XDUDQWHHG E\ WKH * XDUDQWRU DQG DUH GHSHQGHQWXSRQ WKH * XDUDQWRUDQG RULWVRWKHUVXEVLGLDULHVWR P HHW RXUREOLJ DWLRQVXQGHUWKH 1 RWHVLQ WKH RUGLQDU\ FRXUVH 7 KHUHIRUH RXUDELOLW\ WR P DNH SD\ P HQWVRQ WKH 1 RWHVP D\ ▇▇ ▇▇▇ LWHG
9 DOXDWLRQ DQG 0 DUNHWUHODWHG 5 LVNV
7 KH SXEOLF RIIHULQJ SULFH \ RX DUH SD\ LQJ IRUWKH 1 RWHV H[ FHHGV WKHLULQLWLDOHVWLP DWHG YDOXH 7 KH LQLWLDOHVWLP DWHG YDOXH RI WKH 1 RWHVWKDWLVSURYLGHG RQ WKH FRYHUSDJ H RI WKLVSULFLQJ VXSSOHP HQWLVDQ HVWLP DWH RQO\ GHWHUP LQHG DVRI WKH SULFLQJ GDWH E\ UHIHUHQFH WR RXUDQG RXUDIILOLDWHV¶SULFLQJ P RGHOV 7 KHVH SULFLQJ P RGHOVFRQVLGHUFHUWDLQ DVVXP SWLRQVDQG YDULDEOHV LQFOXGLQJ RXUFUHGLWVSUHDGVDQG WKRVH RI WKH * XDUDQWRU WKH * XDUDQWRU¶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¶VLQWHUQDOIXQGLQJ UDWH DQG WKH LQFOXVLRQ LQ WKH SXEOLF RIIHULQJ SULFH RI WKH XQGHUZ ULWLQJ GLVFRXQWLI DQ\ WKH UHIHUUDOIHH DQG WKH KHGJ LQJ UHODWHG FKDUJ HV DOODVIXUWKHUGHVFULEHG LQ ‡6 WUXFWXULQJ WKH 1 RWHV· EHORZ 7 KHVH IDFWRUV WRJ HWKHUZ LWK YDULRXVFUHGLWP DUNHWDQG HFRQRP LF IDFWRUVRYHUWKH WHUP RI WKH 1 RWHV DUH H[ SHFWHG WR UHGXFH WKH SULFH DWZ KLFK \ RX P D\ EH DEOH WR VHOOWKH 1 RWHVLQ DQ\ VHFRQGDU\ P DUNHWDQG Z LOODIIHFWWKH YDOXH RI WKH 1 RWHVLQ FRP SOH[ DQG XQSUHGLFWDEOH Z D\ V
7 KH LQLWLDOHVWLP DWHG YDOXH GRHV QRWUHSUHVHQWD P LQLP XP RUP D[ LP XP SULFH DWZ KLFK Z H %$ & %RI$ 6 RUDQ\ RI RXURWKHUDIILOLDWHV Z RXOG EH Z LOOLQJ WR SXUFKDVH \ RXU1 RWHV LQ DQ\ VHFRQGDU\ P DUNHWLI DQ\ H[ LVWV DWDQ\ WLP H 7 KH YDOXH RI \ RXU1 RWHVDWDQ\ WLP H DIWHULVVXDQFH Z LOOYDU\ EDVHG RQ P DQ\ IDFWRUVWKDWFDQQRWEH SUHGLFWHG Z LWK DFFXUDF\ LQFOXGLQJ WKH SHUIRUP DQFH RI WKH 8 QGHUO\ LQJ 6 WRFNV RXUDQG %$ &¶VFUHGLWZ RUWKLQHVVDQG FKDQJ HVLQ P DUNHWFRQGLWLRQV
: H FDQQRWDVVXUH \ RX WKDWD WUDGLQJ P DUNHWIRU\ RXU1 RWHV Z LOOHYHUGHYHORS RUEH P DLQWDLQHG : H Z LOOQRWOLVWWKH 1 RWHVRQ DQ\ VHFXULWLHVH[ FKDQJ H : H FDQQRWSUHGLFWKRZ WKH 1 RWHV Z LOOWUDGH LQ DQ\ VHFRQGDU\ P DUNHWRUZ KHWKHUWKDWP DUNHWZ LOOEH OLTXLG RULOOLTXLG
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
&RQIOLFWUHODWHG 5 LVNV
7UDGLQJ DQG KHGJ LQJ DFWLYLWLHV E\ XV WKH * XDUDQWRUDQG DQ\ RI RXURWKHUDIILOLDWHV LQFOXGLQJ %RI$ 6 P D\ FUHDWH FRQIOLFWV RI LQWHUHVWZ LWK \ RX DQG P D\ DIIHFW\ RXUUHWXUQ RQ WKH
1 RWHV DQG WKHLUP DUNHWYDOXH : H WKH * XDUDQWRURURQH ▇▇▇ ▇▇▇ RI RXURWKHUDIILOLDWHV LQFOXGLQJ %RI$ 6 P D\ EX\ RUVHOOVKDUHVRI WKH 8 QGHUO\ LQJ 6 WRFNV RUIXWXUHVRURSWLRQVFRQWUDFWVRU H[ FKDQJ H WUDGHG LQVWUXP HQWVRQ WKH 8 QGHUO\ LQJ 6 WRFNV RURWKHULQVWUXP HQWVZ KRVH YDOXH LVGHULYHG IURP WKH 8 QGHUO\ LQJ 6 WRFNV : H WKH * XDUDQWRURURQH ▇▇▇ ▇▇▇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
: H WKH * XDUDQWRURURQH ▇▇▇ ▇▇▇ RI RXURWKHUDIILOLDWHV LQFOXGLQJ %RI$ 6 DOVR P D\ KDYH HQJ DJ HG LQ KHGJ LQJ DFWLYLWLHVWKDWFRXOG KDYH DIIHFWHG WKH SULFHVRI WKH 8 QGHUO\ LQJ 6 WRFNVRQ WKH SULFLQJ GDWH ,Q DGGLWLRQ WKHVH KHGJ LQJ DFWLYLWLHV LQFOXGLQJ WKH XQZ LQGLQJ RI D KHGJ H P D\ GHFUHDVH WKH P DUNHWYDOXH RI \ RXU1 RWHVSULRUWR P DWXULW\ DQG P D\ DIIHFWWKH DP RXQWVWR EH SDLG RQ WKH
1 RWHV : H WKH * XDUDQWRURURQH ▇▇▇ ▇▇▇ RI RXURWKHUDIILOLDWHV LQFOXGLQJ %RI$ 6 P D\ SXUFKDVH RURWKHUZ LVH DFTXLUH D ORQJ RUVKRUWSRVLWLRQ LQ WKH 1 RWHVDQG P D\ ▇▇▇▇ RUUHVHOOWKH 1 RWHV ) RU H[ ▇▇ ▇▇▇ %RI$ 6 P D\ HQWHULQWR WKHVH WUDQVDFWLRQVLQ FRQQHFWLRQ Z LWK DQ\ P DUNHWP DNLQJ DFWLYLWLHVLQ Z KLFK LWHQJ DJ HV : H FDQQRWDVVXUH \ RX WKDWWKHVH DFWLYLWLHVZ LOOQRWDGYHUVHO\ DIIHFWWKH SULFHVRI WKH 8 QGHUO\ LQJ 6 WRFNV WKH P DUNHWYDOXH RI \ RXU1 RWHVSULRUWR P DWXULW\ RUWKH DP RXQWVSD\ DEOH RQ WKH 1 RWHV
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
8 QGHUO\ LQJ 6 WRFN UHODWHG 5 LVNV
7 KH WHUP V RI WKH 1 RWHV Z LOOQRWEH DGMXVWHG IRUDOOFRUSRUDWH HYHQWV WKDWFRXOG DIIHFWDQ LVVXHURI DQ 8 QGHUO\ LQJ 6 WRFN 7 KH 3 ULFH 0 XOWLSOLHURI DQ 8 QGHUO\ LQJ 6 WRFN WKH GHWHUP LQDWLRQ RI WKH SD\ P HQWVRQ WKH 1 RWHV DQG RWKHUWHUP VRI WKH 1 RWHVP D\ EH DGMXVWHG IRUWKH VSHFLILHG FRUSRUDWH HYHQWVDIIHFWLQJ WKH 8 QGHUO\ LQJ 6 WRFN DVGHVFULEHG LQ WKH VHFWLRQ HQWLWOHG ‡’ HVFULSWLRQ RI WKH 1 RWHV† $ QWL’ LOXWLRQ$ GMXVWP HQWV·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
7D[ UHODWHG 5 LVNV
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‡8 6 ) HGHUDO,QFRP H 7D[ 6 XP P DU\ † * HQHUDO· ,I WKH ,QWHUQDO5 HYHQXH 6 HUYLFH WKH ‡,5 6 · Z HUH VXFFHVVIXOLQ DVVHUWLQJ DQ DOWHUQDWLYH FKDUDFWHUL] DWLRQ IRU WKH 1 RWHV WKH WLP LQJ DQG FKDUDFWHURI LQFRP H J DLQ RUORVVZ LWK UHVSHFWWR WKH 1 RWHVP D\ GLIIHU 1 R UXOLQJ Z LOOEH UHTXHVWHG IURP WKH ,5 6 Z LWK UHVSHFWWR WKH 1 RWHVDQG QR DVVXUDQFH FDQ EH
J LYHQ WKDWWKH ,5 6 Z LOODJ UHH Z LWK WKH VWDWHP HQWVP DGH LQ WKH VHFWLRQ HQWLWOHG ‡8 6 ) HGHUDO,QFRP H 7D[ 6 XP P DU\ · <RX DUH XUJ HG WR FRQVXOWZ LWK \ RXURZ Q WD[ DGYLVRUUHJ DUGLQJ DOO DVSHFWV RI WKH 8 6 IHGHUDOLQFRP H WD[ FRQVHTXHQFHV RI LQYHVWLQJ LQ WKH 1 RWHV
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
7 KH 8 QGHUO\ LQJ 6 WRFNV
: H KDYH GHULYHG WKH IROORZ LQJ LQIRUP DWLRQ RQ HDFK 8 QGHUO\ LQJ 6 WRFNDQG HDFK FRP SDQ\ LVVXLQJ DQ 8 QGHUO\ LQJ 6 WRFN HDFK DQ ‡8 QGHUO\ LQJ &RP SDQ\ · DQG WRJ HWKHU WKH ‡8 QGHUO\ LQJ &RP SDQLHV· IURP SXEOLFO\ DYDLODEOH GRFXP HQWV %HFDXVH HDFK 8 QGHUO\ LQJ 6 WRFNLVUHJ LVWHUHG XQGHUWKH 6 HFXULWLHV( [ FKDQJ H$ FWRI WKH 8 QGHUO\ LQJ &RP SDQLHVDUH UHTXLUHG ▇▇ ▇▇▇▇ SHULRGLFDOO\ FHUWDLQ ILQDQFLDODQG RWKHULQIRUP DWLRQ VSHFLILHG E\ WKH 6 ( & ,QIRUP DWLRQ SURYLGHG WR RUILOHG Z LWK WKH 6 ( & E\ WKH 8 QGHUO\ LQJ &RP SDQLHVFDQ EH ORFDWHG WKURXJ K WKH 6 ( &¶VZ HE VLWH DWVHF J RYE\ UHIHUHQFH WR WKH DSSOLFDEOH &,. QXP EHUVHWIRUWK EHORZ
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
1 RWHV 7 KH VHOHFWLRQ RI WKH 8 QGHUO\ LQJ 6 WRFNVLVQRWD UHFRP P HQGDWLRQ WR EX\ RUVHOOWKH 8 QGHUO\ LQJ 6 WRFNV
&RP P RQ 6 WRFN RI $ UFKHU’ DQLHOV 0 LGODQG &RP SDQ\
$ UFKHU’ DQLHOV 0 LGODQG &RP SDQ\ SURFXUHV WUDQVSRUWV VWRUHV DQG P HUFKDQGLVHVDJ ULFXOWXUDOFRP P RGLWLHVDQG SURGXFWV 7 KH FRP SDQ\ SURFHVVHVRLOVHHGV FRUQ P LOR RDWV EDUOH\ SHDQXWV DQG Z KHDW7 KH FRP SDQ\ DOVR SURFHVVHVSURGXFH SURGXFWVZ KLFK KDYH SULP DULO\ WZ R HQG XVHVLQFOXGLQJ IRRG RUIHHG LQJ UHGLHQWV 7 KLV8 QGHUO\ LQJ 6 WRFNWUDGHVRQ WKH 1 HZ <RUN6 WRFN( [ FKDQJ H
‡1 < 6 ( · XQGHUWKH V\ P ERO $ ’ 0 7 KH FRP SDQ\ V&,. QXP EHULV
+ LVWRULFDO3 HUIRUP DQFH RI $ ’ 0
7 KH IROORZ LQJ J UDSK VHWVIRUWK WKH GDLO\ KLVWRULFDOSHUIRUP DQFH RI $ ’ 0 LQ WKH SHULRG IURP - DQXDU\ WKURXJ K WKH SULFLQJ GDWH : H REWDLQHG WKLVKLVWRULFDOGDWD IURP %ORRP EHUJ / 3 : H KDYH QRW LQGHSHQGHQWO\ YHULILHG WKH DFFXUDF\ RUFRP SOHWHQHVVRI WKH LQIRUP DWLRQ REWDLQHG IURP %ORRP EHUJ / 3 7 KH &ORVLQJ 0 DUNHW3 ULFHVUHIOHFWHG LQ WKH J UDSK EHORZ P D\ KDYH EHHQ DGMXVWHG WR UHIOHFWFHUWDLQ FRUSRUDWH DFWLRQV VXFK DVVWRFNVSOLWVDQG UHYHUVH VWRFNVSOLWV 2 Q WKH SULFLQJ GDWH WKH &ORVLQJ 0 DUNHW3 ULFH RI $ ’ 0 Z DV
7 KLVKLVWRULFDOGDWD RQ$ ’ 0 LVQRWQHFHVVDULO\ LQGLFDWLYH RI WKH IXWXUH SHUIRUP DQFH RI $ ’ 0 RUZ KDWWKH YDOXH RI WKH 1 RWHVP D\ EH $ Q\ KLVWRULFDOXSZ DUG RUGRZ QZ DUG WUHQG LQ WKH &ORVLQJ 0 DUNHW3 ULFH RI $ ’ 0 GXULQJ DQ\ SHULRG VHWIRUWK DERYH LVQRWDQ LQGLFDWLRQ WKDWWKH &ORVLQJ 0 DUNHW3 ULFH RI $ ’ 0 LVP RUH RUOHVVOLNHO\ WR LQFUHDVH RUGHFUHDVH DWDQ\ WLP H RYHUWKH WHUP RI WKH 1 RWHV
%HIRUH LQYHVWLQJ LQ WKH 1 RWHV \ RX VKRXOG FRQVXOWSXEOLFO\ DYDLODEOH VRXUFHVIRUWKH &ORVLQJ 0 DUNHW3 ULFHVDQG WUDGLQJ SDWWHUQ RI $ ’ 0
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
&RP P RQ 6 WRFN RI ’ HHUH &RP SDQ\
’ HHUH &RP SDQ\ P DQXIDFWXUHVDQG GLVWULEXWHVD UDQJ H RI DJ ULFXOWXUDOFRQVWUXFWLRQ IRUHVWU\ DQG FRP P HUFLDODQG FRQVXP HUHTXLSP HQW7 KH FRP SDQ\ VXSSOLHVUHSODFHP HQWSDUWVIRULWVRZ Q SURGXFWV DQG IRUWKRVH RI RWKHUP DQXIDFWXUHUV 7 KH FRP SDQ\ DOVR SURYLGHVSURGXFWDQG SDUWVILQDQFLQJ VHUYLFHV 7 KH FRP SDQ\ H[ WHQGVLWVVHUYLFHVDQG SURGXFWVZ RUOGZ LGH 7 KLV8 QGHUO\ LQJ 6 WRFNWUDGHVRQ WKH 1 < 6 ( XQGHUWKH V\ P ERO ’ ( 7 KH FRP SDQ\ V&,. QXP EHULV
+ LVWRULFDO3 HUIRUP DQFH RI ’ (
7 KH IROORZ LQJ J UDSK VHWVIRUWK WKH GDLO\ KLVWRULFDOSHUIRUP DQFH RI ’ ( LQ WKH SHULRG IURP - DQXDU\ WKURXJ K WKH SULFLQJ GDWH : H REWDLQHG WKLVKLVWRULFDOGDWD IURP %ORRP EHUJ / 3 : H KDYH QRW LQGHSHQGHQWO\ YHULILHG WKH DFFXUDF\ RUFRP SOHWHQHVVRI WKH LQIRUP DWLRQ REWDLQHG IURP %ORRP EHUJ / 3 7 KH &ORVLQJ 0 DUNHW3 ULFHVUHIOHFWHG LQ WKH J UDSK EHORZ P D\ KDYH EHHQ DGMXVWHG WR UHIOHFWFHUWDLQ FRUSRUDWH DFWLRQV VXFK DVVWRFNVSOLWVDQG UHYHUVH VWRFNVSOLWV 2 Q WKH SULFLQJ GDWH WKH &ORVLQJ 0 DUNHW3 ULFH RI ’ ( Z DV
7 KLVKLVWRULFDOGDWD RQ ’ ( LVQRWQHFHVVDULO\ LQGLFDWLYH RI WKH IXWXUH SHUIRUP DQFH RI ’ ( RUZ KDWWKH YDOXH RI WKH 1 RWHVP D\ EH $ Q\ KLVWRULFDOXSZ DUG RUGRZ QZ DUG WUHQG LQ WKH &ORVLQJ 0 DUNHW3 ULFH RI ’ ( GXULQJ DQ\ SHULRG VHWIRUWK DERYH LVQRWDQ LQGLFDWLRQ WKDWWKH &ORVLQJ 0 DUNHW3 ULFH RI ’ ( LVP RUH RUOHVVOLNHO\ WR LQFUHDVH RUGHFUHDVH DWDQ\ WLP H RYHUWKH WHUP RI WKH 1 RWHV
%HIRUH LQYHVWLQJ LQ WKH 1 RWHV \ RX VKRXOG FRQVXOWSXEOLFO\ DYDLODEOH VRXUFHVIRUWKH &ORVLQJ 0 DUNHW3 ULFHVDQG WUDGLQJ SDWWHUQ RI ’ (
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
&RP P RQ 6 WRFN RI 7 KH : DOW’ LVQH\ &RP SDQ\
7 KH : DOW’ LVQH\ &RP SDQ\ LVDQ HQWHUWDLQP HQWFRP SDQ\ Z LWK RSHUDWLRQVLQ P HGLD QHWZ RUNV SDUNH[ SHULHQFHV FRQVXP HUSURGXFWV VWXGLR HQWHUWDLQP HQWDQG GLUHFWWR FRQVXP HUQHWZ RUNVDQG FKDQQHOV 7 KH FRP SDQ\ VHUYHVFXVWRP HUVZ RUOGZ LGH 7 KLV8 QGHUO\ LQJ 6 WRFNWUDGHVRQ WKH 1 < 6 ( XQGHUWKH V\ P ERO ’ ,6 7 KH FRP SDQ\ V&,. QXP EHULV
+ LVWRULFDO3 HUIRUP DQFH RI ’ ,6
7 KH IROORZ LQJ J UDSK VHWVIRUWK WKH GDLO\ KLVWRULFDOSHUIRUP DQFH RI ’ ,6 LQ WKH SHULRG IURP - DQXDU\ WKURXJ K WKH SULFLQJ GDWH : H REWDLQHG WKLVKLVWRULFDOGDWD IURP %ORRP EHUJ / 3 : H KDYH QRW LQGHSHQGHQWO\ YHULILHG WKH DFFXUDF\ RUFRP SOHWHQHVVRI WKH LQIRUP DWLRQ REWDLQHG IURP %ORRP EHUJ / 3 7 KH &ORVLQJ 0 DUNHW3 ULFHVUHIOHFWHG LQ WKH J UDSK EHORZ P D\ KDYH EHHQ DGMXVWHG WR UHIOHFWFHUWDLQ FRUSRUDWH DFWLRQV VXFK DVVWRFNVSOLWVDQG UHYHUVH VWRFNVSOLWV 2 Q WKH SULFLQJ GDWH WKH &ORVLQJ 0 DUNHW3 ULFH RI ’ ,6 Z DV
7 KLVKLVWRULFDOGDWD RQ ’ ,6 LVQRWQHFHVVDULO\ LQGLFDWLYH RI WKH IXWXUH SHUIRUP DQFH RI ’ ,6 RUZ KDWWKH YDOXH RI WKH 1 RWHVP D\ EH $ Q\ KLVWRULFDOXSZ DUG RUGRZ QZ DUG WUHQG LQ WKH &ORVLQJ 0 DUNHW3 ULFH RI ’ ,6 GXULQJ DQ\ SHULRG VHWIRUWK DERYH LVQRWDQ LQGLFDWLRQ WKDWWKH &ORVLQJ 0 DUNHW3 ULFH RI ’ ,6 LVP RUH RUOHVVOLNHO\ WR LQFUHDVH RUGHFUHDVH DWDQ\ WLP H RYHUWKH WHUP RI WKH 1 RWHV
%HIRUH LQYHVWLQJ LQ WKH 1 RWHV \ RX VKRXOG FRQVXOWSXEOLFO\ DYDLODEOH VRXUFHVIRUWKH &ORVLQJ 0 DUNHW3 ULFHVDQG WUDGLQJ SDWWHUQ RI ’ ,6
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
6 XSSOHP HQWWR WKH 3 ODQ RI ’ LVWULEXWLRQ 5 ROH RI %RI$ 6 DQG &RQIOLFWVRI ,QWHUHVW
%RI$ 6 D EURNHUGHDOHUDIILOLDWH RI RXUV LVD P HP EHURI WKH ) LQDQFLDO,QGXVWU\ 5 HJ XODWRU\ $ XWKRULW\ ,QF ‡) ,1 5 $ · DQG Z LOOSDUWLFLSDWH DVVHOOLQJ DJ HQWLQ WKH GLVWULEXWLRQ RI WKH 1 RWHV $ FFRUGLQJ O\ WKH RIIHULQJ RI WKH 1 RWHVZ LOOFRQIRUP WR WKH UHTXLUHP HQWVRI ) ,1 5 $ 5 XOH %RI$ 6 P D\ QRWP DNH VDOHVLQ WKLVRIIHULQJ WR DQ\ RI LWVGLVFUHWLRQDU\ DFFRXQWVZ LWKRXWWKH SULRUZ ULWWHQ DSSURYDORI WKH DFFRXQWKROGHU
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
8 QGHURXUGLVWULEXWLRQ DJ UHHP HQWZ LWK %RI$ 6 %RI$ 6 Z LOOSXUFKDVH WKH 1 RWHVIURP XVDVSULQFLSDODWWKH SXEOLF RIIHULQJ SULFH LQGLFDWHG RQ WKH FRYHURI WKLVSULFLQJ VXSSOHP HQWOHVVWKH LQGLFDWHG XQGHUZ ULWLQJ GLVFRXQWLI DQ\ %RI$ 6 Z LOOVHOOWKH 1 RWHVWR RWKHUEURNHUGHDOHUVWKDWZ LOOSDUWLFLSDWH LQ WKH RIIHULQJ DQG WKDWDUH QRWDIILOLDWHG Z LWK XV DWDQ DJ UHHG GLVFRXQWWR WKH SULQFLSDODP RXQW( DFK R WKRVH EURNHUGHDOHUVP D\ VHOOWKH 1 RWHVWR RQH ▇▇▇ ▇▇▇ DGGLWLRQDOEURNHUGHDOHUV %RI$ 6 KDVLQIRUP HG XVWKDWWKHVH GLVFRXQWVP D\ YDU\ IURP GHDOHUWR GHDOHUDQG WKDWQRWDOOGHDOHUVZ LOOSXUFKDVH RU UHSXUFKDVH WKH 1 RWHVDWWKH VDP H GLVFRXQW&HUWDLQ GHDOHUVZ KR SXUFKDVH WKH 1 RWHVIRUVDOH WR FHUWDLQ IHH EDVHG DGYLVRU\ DFFRXQWVP D\ IRUJ R VRP H RUDOORI WKHLUVHOOLQJ FRQFHVVLRQV IHHVRU
FRP P LVVLRQV 7 KH SXEOLF RIIHULQJ SULFH IRULQYHVWRUVSXUFKDVLQJ WKH 1 RWHVLQ WKHVH IHH EDVHG DGYLVRU\ DFFRXQWVP D\ EH DVORZ DV SHU LQ SULQFLSDODP RXQWRI 1 RWHV ,Q DGGLWLRQ WR WKH XQGHUZ ULWLQJ GLVFRXQWLI DQ\ DQ DIILOLDWH RI %RI$ ) LQDQFH Z LOOSD\ D UHIHUUDOIHH RI XS ▇▇ ▇▇▇ LQ SULQFLSDODP RXQWRI 1 RWHVLQ FRQQHFWLRQ Z LWK WKH GLVWULEXWLRQ RI WKH 1 RWHVWR RWKHU
UHJ LVWHUHG EURNHUGHDOHUV
%RI$ 6 DQG DQ\ RI RXURWKHUEURNHUGHDOHUDIILOLDWHVP D\ XVH WKLVSULFLQJ VXSSOHP HQWDQG WKH DFFRP SDQ\ LQJ SURGXFWVXSSOHP HQWSURVSHFWXVVXSSOHP HQWDQG SURVSHFWXVIRURIIHUVDQG VDOHVLQ VHFRQGDU\ P DUNHWWUDQVDFWLRQVDQG P DUNHWP DNLQJ WUDQVDFWLRQVLQ WKH 1 RWHV + RZ HYHU WKH\ DUH QRWREOLJ DWHG WR HQJ ▇▇ ▇ LQ VXFK VHFRQGDU\ P DUNHWWUDQVDFWLRQVDQG RUP DUNHWP DNLQJ WUDQVDFWLRQV 7 KHVH EURNHUGHDOHUDIILOLDWHVP D\ DFWDVSULQFLSDORUDJ HQWLQ WKHVH WUDQVDFWLRQV DQG DQ\ VXFK VDOHVZ LOOEH P DGH DWSULFHVUHODWHG WR SUHYDLOLQJ P DUNHWFRQGLWLRQVDWWKH WLP H RI WKH VDOH
$ W%RI$ 6 ¶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
$ Q\ SULFH WKDW%RI$ 6 P D\ SD\ WR UHSXUFKDVH WKH 1 RWHVZ LOOGHSHQG XSRQ WKHQ SUHYDLOLQJ P DUNHWFRQGLWLRQV WKH FUHGLWZ RUWKLQHVVRI XVDQG WKH * XDUDQWRU DQG WUDQVDFWLRQ FRVWV $ WFHUWDLQ WLP HV WKLV SULFH P D\ EH KLJ KHUWKDQ RUORZ HUWKDQ WKH LQLWLDOHVWLP DWHG YDOXH RI WKH 1 RWHV
( XURSHDQ ( FRQRP LF $ UHD DQG 8 QLWHG . LQJ GRP
1 RQH RI WKLVSULFLQJ VXSSOHP HQWWKH DFFRP SDQ\ LQJ SURGXFWVXSSOHP HQWWKH DFFRP SDQ\ LQJ SURVSHFWXVRUWKH DFFRP SDQ\ LQJ SURVSHFWXVVXSSOHP HQWLVD SURVSHFWXVIRUWKH SXUSRVHVRI WKH
3 URVSHFWXV5 HJ XODWLRQ DVGHILQHG EHORZ 7 KLVSULFLQJ VXSSOHP HQWWKH DFFRP SDQ\ LQJ SURGXFWVXSSOHP HQWWKH DFFRP SDQ\ LQJ SURVSHFWXVDQG WKH DFFRP SDQ\ LQJ SURVSHFWXVVXSSOHP HQWKDYH EHHQ SUHSDUHG RQ WKH EDVLVWKDWDQ\ RIIHURI 1 RWHVLQ DQ\ 0 HP EHU6 WDWH RI WKH ( XURSHDQ ( FRQRP LF $ UHD WKH ‡( ( $ · RULQ WKH 8 QLWHG . LQJ GRP HDFK D ‡5 HOHYDQW6 WDWH· Z LOORQO\ EH P DGH WR D OHJ DOHQWLW\
Z KLFK LVD TXDOLILHG LQYHVWRUXQGHUWKH 3 URVSHFWXV5 HJ XODWLRQ ‡4 XDOLILHG ,QYHVWRUV· $ FFRUGLQJ O\ DQ\ SHUVRQ P DNLQJ RULQWHQGLQJ WR P DNH DQ RIIHULQ WKDW5 HOHYDQW6 WDWH RI 1 RWHVZ KLFK DUH WKH VXEMHF RI WKH RIIHULQJ FRQWHP SODWHG LQ WKLVSULFLQJ VXSSOHP HQWWKH DFFRP SDQ\ LQJ SURGXFWVXSSOHP HQWWKH DFFRP SDQ\ LQJ SURVSHFWXVDQG WKH DFFRP SDQ\ LQJ SURVSHFWXVVXSSOHP HQWP D\ RQO\ GR VR Z LWK UHVSHFWWR 4 XDOLILHG ,QYHVWRUV 1 HLWKHU%RI$ ) LQDQFH QRU%$ & KDVDXWKRUL] HG QRUGRHVLWDXWKRUL] H WKH P DNLQJ RI DQ\ RIIHURI 1 RWHVRWKHUWKDQ WR 4 XDOLILHG ,QYHVWRUV 7 KH H[ SUHVVLRQ ‡3 URVSHFWXV
5 HJ XODWLRQ· P HDQV5 HJ XODWLRQ ( 8
3 5 2 + ,%,7 ,2 1 2 ) 6 $ / ( 6 72 ( ( $ $ 1 ’ 8 1 ,7 ( ’ . ,1 * ’ 2 0 5 ( 7$ ,/ ,1 9 ( 6 72 5 6 – 7 KH 1 RWHVDUH QRWLQWHQGHG WR EH RIIHUHG VROG RURWKHUZ LVH P DGH DYDLODEOH WR DQG VKRXOG QRWEH RIIHUHG VROG RU RWKHUZ LVH P DGH DYDLODEOH WR DQ\ UHWDLOLQYHVWRULQ WKH ( ( $ RULQ WKH 8 QLWHG . LQJ GRP ) RUWKHVH SXUSRVHV D D UHWDLOLQYHVWRUP HDQVD SHUVRQ Z KR LVRQH ▇▇▇ ▇▇▇ RI ▇ ▇ UHWDLOFOLHQWDVGHILQHG LQ SRLQW RI $ UWLFOH RI ’ LUHFWLYH ( 8 DVDP HQGHG ‡0 L) ,’ ,,· RU LL D FXVWRP HUZ LWKLQ WKH P HDQLQJ RI ’ LUHFWLYH ( 8 WKH ,QVXUDQFH ’ LVWULEXWLRQ ’ LUHFWLYH Z KHUH WKDWFXVWRP HU
Z RXOG QRWTXDOLI\ DVD SURIHVVLRQDOFOLHQWDVGHILQHG LQ SRLQW RI $ UWLFOH RI 0 L) ,’ ,, RU LLL QRWD TXDOLILHG LQYHVWRUDVGHILQHG LQ WKH 3 URVSHFWXV5 HJ XODWLRQ DQG E WKH H[ SUHVVLRQ ‡RIIHU· LQFOXGHV WKH FRP P XQLFDWLRQ LQ DQ\ IRUP DQG E\ DQ\ P HDQVRI VXIILFLHQWLQIRUP DWLRQ RQ WKH WHUP VRI WKH RIIHUDQG WKH 1 RWHVWR EH RIIHUHG VR DVWR HQDEOH DQ LQYHVWRUWR GHFLGH WR SXUFKDVH RUVXEVFULEH IRUWKH
1 RWHV &RQVHTXHQWO\ QR NH\ LQIRUP DWLRQ GRFXP HQWUHTXLUHG E\ 5 HJ XODWLRQ ( 8 1 R DVDP HQGHG WKH ‡3 5 ,,3 V5 HJ XODWLRQ· IRURIIHULQJ RUVHOOLQJ WKH 1 RWHVRURWKHUZ LVH P DNLQJ WKHP DYDLODEOH WR UHWDLOLQYHVWRUVLQ WKH ( ( $ RULQ WKH 8 QLWHG . LQJ GRP KDVEHHQ SUHSDUHG DQG WKHUHIRUH RIIHULQJ RUVHOOLQJ WKH 1 RWHVRURWKHUZ LVH P DNLQJ WKHP DYDLODEOH WR DQ\ UHWDLOLQYHVWRULQ WKH ( ( $ RULQ WKH 8 QLWHG . LQJ GRP P D\ EH XQODZ IXOXQGHUWKH 3 5 ,,3 V5 HJ XODWLRQ
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
8 QLWHG . LQJ GRP
7 KH FRP P XQLFDWLRQ RI WKLVSULFLQJ VXSSOHP HQWWKH DFFRP SDQ\ LQJ SURGXFWVXSSOHP HQWWKH DFFRP SDQ\ LQJ SURVSHFWXVVXSSOHP HQWWKH DFFRP SDQ\ LQJ SURVSHFWXVDQG DQ\ RWKHUGRFXP HQWRUP DWHULDOV UHODWLQJ WR WKH LVVXH RI WKH 1 RWHVRIIHUHG KHUHE\ LVQRWEHLQJ P DGH DQG VXFK GRFXP HQWVDQG RUP DWHULDOVKDYH QRWEHHQ DSSURYHG E\ DQ DXWKRUL] HG SHUVRQ IRUWKH SXUSRVHVRI 6 HFWLRQ RI WKH
8 QLWHG . LQJ GRP ¶V) LQDQFLDO6 HUYLFHVDQG 0 DUNHWV$ FW DVDP HQGHG WKH ‡) 6 0 $ · $ FFRUGLQJ O\ VXFK GRFXP HQWVDQG RUP DWHULDOVDUH QRWEHLQJ GLVWULEXWHG WR DQG P XVWQRWEH SDVVHG RQ WR WKH J HQHUDOSXEOLF LQ WKH 8 QLWHG . LQJ GRP 7 KH FRP P XQLFDWLRQ RI VXFK GRFXP HQWVDQG RUP DWHULDOVDVD ILQDQFLDOSURP RWLRQ LVRQO\ EHLQJ P DGH WR WKRVH SHUVRQVLQ WKH 8 QLWHG . LQJ GRP Z KR KDYH SURIHVVLRQDOH[ SHULHQFH LQ P DWWHUVUHODWLQJ WR LQYHVWP HQWVDQG Z KR IDOOZ LWKLQ WKH GHILQLWLRQ RI LQYHVWP HQWSURIHVVLRQDOV DVGHILQHG LQ$ UWLFOH RI WKH ) LQDQFLDO6 HUYLFHVDQG 0 DUNHWV$ FW
) LQDQFLDO3 URP RWLRQ 2 UGHU DVDP HQGHG WKH ‡) LQDQFLDO3 URP RWLRQ 2 UGHU· ▇▇▇ ▇▇ IDOOZ LWKLQ$ UWLFOH D WR G RI WKH ) LQDQFLDO3 URP RWLRQ 2 UGHU ▇▇▇ ▇▇ DUH DQ\ RWKHUSHUVRQVWR Z KRP LW P D\ RWKHUZ LVH ODZ IXOO\ EH P DGH XQGHUWKH ) LQDQFLDO3 URP RWLRQ 2 UGHU DOOVXFK SHUVRQVWRJ HWKHUEHLQJ UHIHUUHG WR DV‡5 HOHYDQW3 HUVRQV·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
$ Q\ LQYLWDWLRQ RULQGXFHP HQWWR HQJ ▇▇ ▇ LQ LQYHVWP HQWDFWLYLW\ Z LWKLQ WKH P HDQLQJ RI 6 HFWLRQ RI WKH ) 6 0 $ LQ FRQQHFWLRQ Z LWK WKH LVVXH RUVDOH RI WKH 1 RWHVP D\ RQO\ EH FRP P XQLFDWHG RUFDXVHG WR EH FRP P XQLFDWHG LQ FLUFXP VWDQFHVLQ Z KLFK 6 HFWLRQ RI WKH ) 6 0 $ GRHVQRWDSSO\ WR %RI$ ) LQDQFH DV,VVXHU RU%$ & DV* XDUDQWRU
$ OODSSOLFDEOH SURYLVLRQVRI WKH ) 6 0 $ P XVWEH FRP SOLHG Z LWK LQ UHVSHFWWR DQ\ WKLQJ GRQH E\ DQ\ SHUVRQ LQ UHODWLRQ WR WKH 1 RWHVLQ IURP RURWKHUZ LVH LQYROYLQJ WKH 8 QLWHG . LQJ GRP
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
6 WUXFWXULQJ WKH 1 RWHV
7 KH 1 RWHVDUH RXUGHEWVHFXULWLHV WKH UHWXUQ RQ Z KLFK LVOLQNHG WR WKH SHUIRUP DQFH RI WKH 8 QGHUO\ LQJ 6 WRFNV 7 KH UHODWHG J XDUDQWHH LV%$ &¶VREOLJ DWLRQ $ VLVWKH FDVH IRUDOORI RXUDQG %$ &¶V UHVSHFWLYH GHEWVHFXULWLHV LQFOXGLQJ RXUP DUNHWOLQNHG QRWHV WKH HFRQRP LF WHUP VRI WKH 1 RWHVUHIOHFWRXUDQG %$ &¶VDFWXDORUSHUFHLYHG FUHGLWZ RUWKLQHVVDWWKH WLP H RI SULFLQJ ,Q DGGLWLRQ EHFDXVH P DUNHWOLQNHG QRWHVUHVXOWLQ LQFUHDVHG RSHUDWLRQDOIXQGLQJ DQG OLDELOLW\ P DQDJ HP HQWFRVWVWR XVDQG %$ & %$ & W\ SLFDOO\ ERUURZ VWKH IXQGVXQGHUWKHVH W\ SHVRI QRWHVDWD UDWH Z KLFK Z H UHIHUWR LQ
WKLVSULFLQJ VXSSOHP HQWDV%$ &¶VLQWHUQDOIXQGLQJ UDWH WKDWLVP RUH IDYRUDEOH WR %$ & WKDQ WKH UDWH WKDWLWP LJ KWSD\ IRUD FRQYHQWLRQDOIL[ HG RUIORDWLQJ UDWH GHEWVHFXULW\ 7 KLVJ HQHUDOO\ UHODWLYHO\ ORZ HU LQWHUQDOIXQGLQJ UDWH Z KLFK LVUHIOHFWHG LQ WKH HFRQRP LF WHUP VRI WKH 1 RWHV DORQJ Z LWK WKH IHHVDQG FKDUJ HVDVVRFLDWHG Z LWK P DUNHWOLQNHG QRWHV UHVXOWHG LQ WKH LQLWLDOHVWLP DWHG YDOXH RI WKH 1 RWHVRQ WKH SULFLQJ GDWH EHLQJ OHVVWKDQ WKHLUSXEOLF RIIHULQJ SULFH
,Q RUGHUWR P HHWRXUSD\ P HQWREOLJ DWLRQVRQ WKH 1 RWHV DWWKH WLP H Z H LVVXH WKH 1 RWHV Z H P D\ FKRRVH WR HQWHULQWR FHUWDLQ KHGJ LQJ DUUDQJ HP HQWV Z KLFK P D\ LQFOXGH FDOORSWLRQV SXWRSWLRQVRURWKHU GHULYDWLYHV Z LWK %RI$ 6 RURQH RI RXURWKHUDIILOLDWHV 7 KH WHUP VRI WKHVH KHGJ LQJ DUUDQJ HP HQWVDUH GHWHUP LQHG EDVHG XSRQ WHUP VSURYLGHG E\ %RI$ 6 DQG LWVDIILOLDWHV DQG WDNH LQWR DFFRXQWD QXP EHU RI IDFWRUV LQFOXGLQJ RXUDQG %$ &¶VFUHGLWZ RUWKLQHVV LQWHUHVWUDWH P RYHP HQWV WKH YRODWLOLW\ RI WKH 8 QGHUO\ LQJ 6 WRFNV WKH WHQRURI WKH 1 RWHVDQG WKH KHGJ LQJ DUUDQJ HP HQWV 7 KH HFRQRP LF WHUP VRI WKH 1 RWHVDQG WKHLULQLWLDOHVWLP DWHG YDOXH GHSHQG LQ SDUWRQ WKH WHUP VRI WKHVH KHGJ LQJ DUUDQJ HP HQWV
%RI$ 6 KDVDGYLVHG XVWKDWWKH KHGJ LQJ DUUDQJ HP HQWVZ LOOLQFOXGH KHGJ LQJ UHODWHG FKDUJ HV UHIOHFWLQJ WKH FRVWVDVVRFLDWHG Z LWK DQG RXUDIILOLDWHV¶SURILWHDUQHG IURP WKHVH KHGJ LQJ DUUDQJ HP HQWV 6 LQFH KHGJ LQJ HQWDLOVULVNDQG P D\ EH LQIOXHQFHG E\ XQSUHGLFWDEOH P DUNHWIRUFHV DFWXDOSURILWVRUORVVHVIURP WKHVH KHGJ LQJ WUDQVDFWLRQVP D\ ▇▇ ▇ ▇▇▇ RUOHVVWKDQ DQ\ H[ SHFWHG DP RXQWV
) RUIXUWKHULQIRUP DWLRQ VHH ‡5 LVN) DFWRUV· EHJ LQQLQJ RQ SDJ H 3 6 DQG ‡6 XSSOHP HQWDO8 VH RI 3 URFHHGV· RQ SDJ H 3 6 RI WKH DFFRP SDQ\ LQJ SURGXFWVXSSOHP HQW
9 DOLGLW\ RI WKH 1 RWHV
,Q WKH RSLQLRQ RI 0 F* XLUH: RRGV/ / 3 DVFRXQVHOWR %RI$ ) LQDQFH DVLVVXHU DQG %$ & DVJ XDUDQWRU Z KHQ WKH WUXVWHH KDVP DGH WKH DSSURSULDWH HQWULHVRUQRWDWLRQVRQ 6 FKHGXOH WR WKH P DVWHUJ ORED QRWH WKDWUHSUHVHQWVWKH 1 RWHV WKH ‡0 DVWHU1 RWH·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
P RUDWRULXP DQG RWKHUVLP LODUODZ VDIIHFWLQJ FUHGLWRUV¶ULJ KWVJ HQHUDOO\ DQG WR J HQHUDOSULQFLSOHVRI HTXLW\ 7 KLVRSLQLRQ LVJ LYHQ DVRI WKH GDWH RI WKLVSULFLQJ VXSSOHP HQWDQG LVOLP LWHG WR WKH ’ HODZ DUH
* HQHUDO&RUSRUDWLRQ / DZ DQG WKH ’ HODZ DUH / LP LWHG / LDELOLW\ &RP SDQ\ $ FWLQFOXGLQJ WKH VWDWXWRU\ SURYLVLRQV DOODSSOLFDEOH SURYLVLRQVRI WKH ’ HODZ DUH &RQVWLWXWLRQ DQG UHSRUWHG MXGLFLDOGHFLVLRQV LQWHUSUHWLQJ HLWKHURI WKH IRUHJ RLQJ DQG WKH ODZ VRI WKH 6 WDWH RI 1 HZ <RUNDVLQ HIIHFWRQ WKH GDWH KHUHRI ,Q DGGLWLRQ WKLVRSLQLRQ LVVXEMHFWWR FXVWRP DU\ DVVXP SWLRQVDERXWWKH WUXVWHH¶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’ HFHP EHU Z KLFK KDVEHHQ ILOHG DVDQ H[ KLELWWR WKH 5 HJ LVWUDWLRQ 6 WDWHP HQW) LOH 1 RV DQG RI %$ & DQG %RI$ ) LQDQFH ILOHG Z LWK WKH 6 ( & RQ ’ HFHP EHU
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
8 6 ) HGHUDO,QFRP H 7D[ 6 XP P DU\
7 KH IROORZ LQJ VXP P DU\ RI WKH P DWHULDO8 6 IHGHUDOLQFRP H DQG HVWDWH WD[ FRQVLGHUDWLRQVRI WKH DFTXLVLWLRQ RZ QHUVKLS DQG GLVSRVLWLRQ RI WKH 1 RWHVVXSSOHP HQWV DQG WR WKH H[ WHQWLQFRQVLVWHQW VXSHUVHGHV WKH GLVFXVVLRQ XQGHU‡8 6 ) HGHUDO,QFRP H 7D[ &RQVLGHUDWLRQV· LQ WKH DFFRP SDQ\ LQJ SURVSHFWXVDQG LVQRWH[ KDXVWLYH RI DOOSRVVLEOH WD[ FRQVLGHUDWLRQV 7 KLVVXP P DU\ LVEDVHG XSRQ WKH
,QWHUQDO5 HYHQXH &RGH RI DVDP HQGHG WKH ‡&RGH· UHJ XODWLRQVSURP XOJ DWHG XQGHUWKH &RGH E\ WKH 8 6 7 UHDVXU\ ’ HSDUWP HQW‡7 UHDVXU\ ·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
$ OWKRXJ K WKH 1 RWHVDUH LVVXHG E\ XV WKH\ Z LOOEH WUHDWHG DVLI WKH\ Z HUH LVVXHG E\ %$ & IRU8 6 IHGHUDOLQFRP H WD[ SXUSRVHV $ FFRUGLQJ O\ WKURXJ KRXWWKLVWD[ GLVFXVVLRQ UHIHUHQFHVWR ‡Z H · ‡RXU· RU
‡XV· DUH J HQHUDOO\ WR %$ & XQOHVVWKH FRQWH[ WUHTXLUHVRWKHUZ LVH
7 KLVVXP P DU\ LVGLUHFWHG VROHO\ WR 8 6 + ROGHUVDQG 1 RQ 8 6 + ROGHUVWKDWH[ FHSWDVRWKHUZ LVH VSHFLILFDOO\ QRWHG Z LOOSXUFKDVH WKH 1 RWHVXSRQ RULJ LQDOLVVXDQFH DQG Z LOOKROG WKH 1 RWHVDVFDSLWDO DVVHWVZ LWKLQ WKH P HDQLQJ RI 6 HFWLRQ RI WKH &RGH Z KLFK J HQHUDOO\ P HDQVSURSHUW\ KHOG IRULQYHVWP HQWDQG WKDWDUH QRWH[ FOXGHG IURP WKH GLVFXVVLRQ XQGHU‡8 6 ) HGHUDO,QFRP H 7D[ &RQVLGHUDWLRQV· LQ WKH DFFRP SDQ\ LQJ SURVSHFWXV
<RX VKRXOG FRQVXOW\ RXURZ Q WD[ DGYLVRUFRQFHUQLQJ WKH 8 6 IHGHUDOLQFRP H WD[ FRQVHTXHQFHVWR \ RX RI DFTXLULQJ RZ QLQJ DQG GLVSRVLQJ RI WKH 1 RWHV DVZ HOODVDQ\ WD[ FRQVHTXHQFHVDULVLQJ XQGHU WKH ODZ VRI DQ\ VWDWH ORFDOIRUHLJ Q RURWKHUWD[ MXULVGLFWLRQ DQG WKH SRVVLEOH HIIHFWVRI FKDQJ HVLQ 8 6 IHGHUDORURWKHUWD[ ODZ V
* HQHUDO
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
VLQJ OH ILQDQFLDOFRQWUDFWVZ LWK UHVSHFWWR WKH 8 QGHUO\ LQJ 6 WRFNV 7 KLVGLVFXVVLRQ DVVXP HVWKDWWKH 1 RWHVFRQVWLWXWH FRQWLQJ HQWLQFRP H EHDULQJ VLQJ OH ILQDQFLDOFRQWUDFWVZ LWK UHVSHFWWR WKH 8 QGHUO\ LQJ 6 WRFNVIRU8 6 IHGHUDOLQFRP H WD[ SXUSRVHV ,I WKH 1 RWHVGLG QRWFRQVWLWXWH FRQWLQJ HQWLQFRP H EHDULQJ VLQJ OH ILQDQFLDOFRQWUDFWV WKH WD[ FRQVHTXHQFHVGHVFULEHG EHORZ Z RXOG EH P DWHULDOO\ GLIIHUHQW
7 KLVFKDUDFWHUL] DWLRQ RI WKH 1 RWHVLVQRWELQGLQJ RQ WKH ,5 6 RUWKH FRXUWV 1 R VWDWXWRU\ MXGLFLDORUDGP LQLVWUDWLYH DXWKRULW\ GLUHFWO\ DGGUHVVHVWKH FKDUDFWHUL] DWLRQ RI WKH 1 RWHVRUDQ\ VLP LODULQVWUXP HQWV IRU8 6 IHGHUDOLQFRP H WD[ SXUSRVHV DQG QR UXOLQJ LVEHLQJ UHTXHVWHG IURP WKH ,5 6 Z LWK UHVSHFWWR WKHLUSURSHUFKDUDFWHUL] DWLRQ DQG WUHDWP HQW’ XH WR WKH DEVHQFH RI DXWKRULWLHVRQ SRLQWVLJ QLILFDQW DVSHFWVRI WKH 8 6 IHGHUDOLQFRP H WD[ FRQVHTXHQFHVRI DQ LQYHVWP HQWLQ WKH 1 RWHVDUH QRWFHUWDLQ DQG QR DVVXUDQFH FDQ EH J LYHQ WKDWWKH ,5 6 RUDQ\ FRXUWZ LOODJ UHH Z LWK WKH FKDUDFWHUL] DWLRQ DQG WD[ WUHDWP HQWGHVFULEHG LQ WKLVSULFLQJ VXSSOHP HQW$ FFRUGLQJ O\ \ RX DUH XUJ HG WR FRQVXOW\ RXUWD[ DGYLVRUUHJ DUGLQJ DOODVSHFWVRI WKH 8 6 IHGHUDOLQFRP H WD[ FRQVHTXHQFHVRI DQ LQYHVWP HQWLQ WKH 1 RWHV LQFOXGLQJ SRVVLEOH DOWHUQDWLYH FKDUDFWHUL] DWLRQV
8 QOHVVRWKHUZ LVH VWDWHG WKH IROORZ LQJ GLVFXVVLRQ LVEDVHG RQ WKH FKDUDFWHUL] DWLRQ GHVFULEHG DERYH 7 KH GLVFXVVLRQ LQ WKLVVHFWLRQ DVVXP HVWKDWWKHUH LVD VLJ QLILFDQWSRVVLELOLW\ RI D VLJ QLILFDQWORVVRI SULQFLSDORQ DQ LQYHVWP HQWLQ WKH 1 RWHV
: H Z LOOQRWDWWHP SWWR DVFHUWDLQ Z KHWKHUWKH LVVXHURI DQ\ 8 QGHUO\ LQJ 6 WRFNZ RXOG EH WUHDWHG DVD ‡SDVVLYH IRUHLJ Q LQYHVWP HQWFRP SDQ\ · ‡3 ) ,&· Z LWKLQ WKH P HDQLQJ RI 6 HFWLRQ RI WKH &RGH ▇▇▇ 8 QLWHG 6 WDWHVUHDOSURSHUW\ KROGLQJ FRUSRUDWLRQ Z LWKLQ WKH P HDQLQJ RI 6 HFWLRQ F RI WKH &RGH ,I WKH LVVXHURI DQ\ 8 QGHUO\ LQJ 6 WRFNZ HUH VR WUHDWHG FHUWDLQ DGYHUVH 8 6 IHGHUDOLQFRP H WD[ FRQVHTXHQFHVFRXOG SRVVLEO\ DSSO\ WR D KROGHURI WKH 1 RWHV <RX VKRXOG UHIHUWR LQIRUP DWLRQ ILOHG Z LWK WKH 6 ( & E\ WKH LVVXHUVRI WKH 8 QGHUO\ LQJ 6 WRFNVDQG FRQVXOW\ RXUWD[ DGYLVRUUHJ DUGLQJ WKH SRVVLEOH FRQVHTXHQFHVWR \ RX LI DQ\ LI WKH LVVXHURI DQ\ 8 QGHUO\ LQJ 6 WRFNLVRUEHFRP HVD 3 ) ,& RULVRUEHFRP HVD 8 QLWHG 6 WDWHVUHDOSURSHUW\ KROGLQJ FRUSRUDWLRQ
8 6 + ROGHUV
$ OWKRXJ K WKH 8 6 IHGHUDOLQFRP H WD[ WUHDWP HQWRI DQ\ &RQWLQJ HQW&RXSRQ 3 D\ P HQWRQ WKH 1 RWHVLVXQFHUWDLQ Z H LQWHQG WR WDNH WKH SRVLWLRQ DQG WKH IROORZ LQJ GLVFXVVLRQ DVVXP HV WKDWDQ\ &RQWLQJ HQ &RXSRQ 3 D\ P HQWFRQVWLWXWHVWD[ DEOH RUGLQDU\ LQFRP H WR D 8 6 + ROGHUDWWKH WLP H UHFHLYHG RUDFFUXHG LQ DFFRUGDQFH Z LWK WKH 8 6 + ROGHU¶VUHJ XODUP HWKRG RI DFFRXQWLQJ %\ SXUFKDVLQJ WKH 1 RWHV
\ RX DJ UHH LQ WKH DEVHQFH RI DQ DGP LQLVWUDWLYH GHWHUP LQDWLRQ RUMXGLFLDOUXOLQJ WR WKH FRQWUDU\ WR WUHDWDQ\ &RQWLQJ HQW&RXSRQ 3 D\ P HQWDVGHVFULEHG LQ WKH SUHFHGLQJ VHQWHQFH
8 SRQ UHFHLSWRI D FDVK SD\ P HQWDWP DWXULW\ RUXSRQ D VDOH H[ FKDQJ H RUUHGHP SWLRQ RI WKH 1 RWHVSULRUWR P DWXULW\ D 8 6 + ROGHUJ HQHUDOO\ Z LOOUHFRJ QL] H FDSLWDOJ DLQ RUORVVHTXDOWR WKH GLIIHUHQFH EHWZ HHQ WKH DP RXQWUHDOL] HG RWKHUWKDQ DP RXQWVUHSUHVHQWLQJ DQ\ &RQWLQJ HQW&RXSRQ 3 D\ P HQWZ KLFK Z RXOG EH WD[ HG DVGHVFULEHG DERYH DQG WKH 8 6 + ROGHU¶VWD[ EDVLVLQ WKH 1 RWHV $ 8 6
+ ROGHU¶VWD[ EDVLVLQ WKH 1 RWHVZ LOOHTXDOWKH DP RXQWSDLG E\ WKDWKROGHUWR DFTXLUH WKHP 7 KLVFDSLWDOJ DLQ RUORVVJ HQHUDOO\ Z LOOEH ORQJ WHUP FDSLWDOJ DLQ RUORVVLI WKH 8 6 + ROGHUKHOG WKH 1 RWHVIRU P RUH WKDQ RQH \ HDU 7 KH GHGXFWLELOLW\ RI FDSLWDOORVVHVLVVXEMHFWWR OLP LWDWLRQV
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
$ OWHUQDWLYH 7D[ 7UHDWP HQWV ’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‡FRP SDUDEOH \ LHOG· GHWHUP LQHG DWWKH WLP H RI LVVXDQFH ,Q DGGLWLRQ DQ\ J DLQ UHDOL] HG E\ D 8 6 + ROGHUDWP DWXULW\ RUXSRQ D VDOH H[ FKDQJ H RUUHGHP SWLRQ RI WKH 1 RWHV
J HQHUDOO\ Z RXOG EH WUHDWHG DVRUGLQDU\ LQFRP H DQG DQ\ ORVVUHDOL] HG DWP DWXULW\ RUXSRQ D VDOH H[ FKDQJ H RUUHGHP SWLRQ RI WKH 1 RWHVJ HQHUDOO\ Z RXOG EH WUHDWHG DVRUGLQDU\ ORVVWR WKH H[ WHQWRI WKH 8 6 + ROGHU¶VSULRUDFFUXDOVRI RULJ LQDOLVVXH GLVFRXQWDQG DVFDSLWDOORVVWKHUHDIWHU
,Q DGGLWLRQ LWLVSRVVLEOH WKDWWKH 1 RWHVFRXOG EH WUHDWHG DVD XQLWFRQVLVWLQJ RI D GHSRVLWDQG D SXWRSWLRQ Z ULWWHQ E\ WKH 1 RWH KROGHU LQ Z KLFK FDVH WKH WLP LQJ DQG FKDUDFWHURI LQFRP H RQ WKH 1 RWHV Z RXOG EH DIIHFWHG VLJ QLILFDQWO\
7 KH ,5 6 UHOHDVHG 1 RWLFH WKH 1 RWLFH Z KLFK VRXJ KWFRP P HQWVIURP WKH SXEOLF RQ WKH WD[ DWLRQ RI ILQDQFLDOLQVWUXP HQWVFXUUHQWO\ WD[ HG DV‡SUHSDLG IRUZ DUG FRQWUDFWV·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
7 KH ,5 6 DQG 7 UHDVXU\ DUH DOVR FRQVLGHULQJ DGGLWLRQDOLVVXHV LQFOXGLQJ Z KHWKHUDGGLWLRQDOJ DLQ RUORVVIURP VXFK LQVWUXP HQWVVKRXOG EH WUHDWHG DVRUGLQDU\ RUFDSLWDOZ KHWKHUIRUHLJ Q KROGHUVRI VXFK LQVWUXP HQWVVKRXOG EH VXEMHFWWR Z LWKKROGLQJ WD[ RQ DQ\ GHHP HG LQFRP H DFFUXDOV Z KHWKHU6 HFWLRQ RI WKH &RGH FRQFHUQLQJ FHUWDLQ ‡FRQVWUXFWLYH RZ QHUVKLS WUDQVDFWLRQV· J HQHUDOO\ DSSOLHVRU VKRXOG J HQHUDOO\ DSSO\ WR VXFK LQVWUXP HQWV DQG Z KHWKHUDQ\ RI WKHVH GHWHUP LQDWLRQVGHSHQG RQ WKH QDWXUH RI WKH XQGHUO\ LQJ DVVHW
,Q DGGLWLRQ SURSRVHG 7 UHDVXU\ UHJ XODWLRQVUHTXLUH WKH DFFUXDORI LQFRP H RQ D FXUUHQWEDVLVIRUFRQWLQJ HQWSD\ P HQWVP DGH XQGHUFHUWDLQ QRWLRQDOSULQFLSDOFRQWUDFWV 7 KH SUHDP EOH WR WKH UHJ XODWLRQV VWDWHVWKDWWKH ‡Z DLWDQG VHH·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
%HFDXVH RI WKH DEVHQFH RI DXWKRULW\ UHJ DUGLQJ WKH DSSURSULDWH WD[ FKDUDFWHUL] DWLRQ RI WKH 1 RWHV LWLVDOVR SRVVLEOH WKDWWKH ,5 6 FRXOG VHHNWR FKDUDFWHUL] H WKH 1 RWHVLQ D P DQQHUWKDWUHVXOWVLQ WD[ FRQVHTXHQFHVWKDWDUH GLIIHUHQWIURP WKRVH GHVFULEHG DERYH ) RUH[ ▇▇ ▇▇▇ WKH ,5 6 FRXOG SRVVLEO\ DVVHUWWKDWDQ\ J DLQ RUORVVWKDWD KROGHUP D\ UHFRJ QL] H DWP DWXULW\ RUXSRQ WKH VDOH H[ FKDQJ H RU UHGHP SWLRQ RI WKH 1 RWHVVKRXOG EH WUHDWHG DVRUGLQDU\ J DLQ RUORVV
1 RQ 8 6 + ROGHUV
%HFDXVH WKH 8 6 IHGHUDOLQFRP H WD[ WUHDWP HQWRI WKH 1 RWHV LQFOXGLQJ DQ\ &RQWLQJ HQW&RXSRQ 3 D\ P HQWLVXQFHUWDLQ Z H RUWKH DSSOLFDEOH SD\ LQJ DJ HQWZ LOOZ LWKKROG 8 6 IHGHUDOLQFRP H WD[ DWD UDWH RUDWD ORZ HUUDWH XQGHUDQ DSSOLFDEOH LQFRP H WD[ WUHDW\ RQ WKH HQWLUH DP RXQWRI DQ\ &RQWLQJ HQW&RXSRQ 3 D\ P HQWP DGH XQOHVVVXFK SD\ P HQWVDUH HIIHFWLYHO\ FRQQHFWHG Z LWK WKH FRQGXFWE\
WKH 1 RQ 8 6 + ROGHURI D WUDGH RUEXVLQHVVLQ WKH 8 6 LQ Z KLFK FDVH WR DYRLG Z LWKKROGLQJ WKH 1 RQ 8 6 + ROGHUZ LOOEH UHTXLUHG WR SURYLGH D ) RUP : ( &, : H RUWKH DSSOLFDEOH SD\ LQJ DJ HQWZ LOOQR SD\ DQ\ DGGLWLRQDODP RXQWVLQ UHVSHFWRI VXFK Z LWKKROGLQJ 7R FODLP EHQHILWVXQGHUDQ LQFRP H WD[ WUHDW\ D 1 RQ 8 6 + ROGHUP XVWREWDLQ D WD[ SD\ HULGHQWLILFDWLRQ QXP EHUDQG FHUWLI\ DVWR LWVHOLJ LELOLW\ XQGHUWKH DSSURSULDWH WUHDW\ ¶VOLP LWDWLRQVRQ EHQHILWVDUWLFOH LI DSSOLFDEOH ,Q DGGLWLRQ VSHFLDOUXOHVP D\ DSSO\ WR FODLP VIRUWUHDW\ EHQHILWVP DGH E\ 1 RQ 8 6 + ROGHUVWKDWDUH HQWLWLHVUDWKHUWKDQ LQGLYLGXDOV 7 KH DYDLODELOLW\ RI D ORZ HUUDWH RI Z LWKKROGLQJ XQGHUDQ DSSOLFDEOH LQFRP H WD[ WUHDW\ Z LOOGHSHQG RQ Z KHWKHUVXFK UDWH DSSOLHVWR WKH FKDUDFWHUL] DWLRQ RI WKH SD\ P HQWVXQGHU8 6 IHGHUDO LQFRP H WD[ ODZ V $ 1 RQ 8 6 + ROGHUWKDWLVHOLJ LEOH IRUD UHGXFHG UDWH RI 8 6 IHGHUDOZ LWKKROGLQJ WD[ SXUVXDQWWR DQ LQFRP H WD[ WUHDW\ P D\ REWDLQ D UHIXQG RI DQ\ H[ FHVVDP RXQWVZ LWKKHOG E\ ILOLQJ DQ DSSURSULDWH FODLP IRUUHIXQG Z LWK WKH ,5 6
( [ FHSWDVGLVFXVVHG EHORZ D 1 RQ 8 6 + ROGHUJ HQHUDOO\ Z LOOQRWEH VXEMHFWWR 8 6 IHGHUDOLQFRP H RUZ LWKKROGLQJ WD[ IRUDP RXQWVSDLG LQ UHVSHFWRI WKH 1 RWHV QRWLQFOXGLQJ IRUWKH DYRLGDQFH RI GRXEW DP RXQWVUHSUHVHQWLQJ DQ\ &RQWLQJ HQW&RXSRQ 3 D\ P HQWZ KLFK Z RXOG EH VXEMHFWWR WKH UXOHVGLVFXVVHG LQ WKH SUHYLRXVSDUDJ UDSK XSRQ WKH VDOH H[ FKDQJ H RUUHGHP SWLRQ RI WKH 1 RWHVRUWKHLU
VHWWOHP HQWDWP DWXULW\ SURYLGHG WKDWWKH 1 RQ 8 6 + ROGHUFRP SOLHVZ LWK DSSOLFDEOH FHUWLILFDWLRQ UHTXLUHP HQWVDQG WKDWWKH SD\ P HQWLVQRWHIIHFWLYHO\ FRQQHFWHG Z LWK WKH FRQGXFWE\ WKH 1 RQ 8 6 + ROGHU RI D 8 6 WUDGH RUEXVLQHVV 1 RWZ LWKVWDQGLQJ WKH IRUHJ RLQJ J DLQ IURP WKH VDOH H[ FKDQJ H RUUHGHP SWLRQ RI WKH 1 RWHVRUWKHLUVHWWOHP HQWDWP DWXULW\ P D\ EH VXEMHFWWR 8 6 IHGHUDOLQFRP H WD[ LI WKDW
1 RQ 8 6 + ROGHULVD QRQ UHVLGHQWDOLHQ LQGLYLGXDODQG LVSUHVHQWLQ WKH 8 6 IRU GD\ VRUP RUH GXULQJ WKH WD[ DEOH \ HDURI WKH VDOH H[ FKDQJ H UHGHP SWLRQ RUVHWWOHP HQWDQG FHUWDLQ RWKHUFRQGLWLRQV DUH VDWLVILHG
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
,I D 1 RQ 8 6 + ROGHURI WKH 1 RWHVLVHQJ DJ HG LQ WKH FRQGXFWRI D WUDGH RUEXVLQHVVZ LWKLQ WKH 8 6 DQG LI DQ\ &RQWLQJ HQW&RXSRQ 3 D\ P HQWDQG J DLQ UHDOL] HG RQ WKH VHWWOHP HQWDWP DWXULW\ RUXSRQ VDOH H[ FKDQJ H RUUHGHP SWLRQ RI WKH 1 RWHV LVHIIHFWLYHO\ FRQQHFWHG Z LWK WKH FRQGXFWRI VXFK WUDGH RUEXVLQHVV DQG LI FHUWDLQ WD[ WUHDWLHVDSSO\ LVDWWULEXWDEOH ▇▇ ▇ ▇▇▇▇ DQHQWHVWDEOLVKP HQWP DLQWDLQHG E\ WKH 1 RQ 8 6 + ROGHULQ WKH 8 6 WKH 1 RQ 8 6 + ROGHU DOWKRXJ K H[ HP SWIURP 8 6 IHGHUDOZ LWKKROGLQJ WD[ J HQHUDOO\ Z LOOEH VXEMHFWWR 8 6 IHGHUDOLQFRP H WD[ RQ VXFK &RQWLQJ HQW&RXSRQ 3 D\ P HQWDQ J DLQ RQ D QHWLQFRP H EDVLVLQ WKH VDP H P DQQHUDVLI LWZ HUH D 8 6 + ROGHU 6 XFK 1 RQ 8 6 + ROGHUVVKRXOG UHDG WKH P DWHULDOXQGHUWKH KHDGLQJ ‡† 8 6 + ROGHUV· IRUD GHVFULSWLRQ RI WKH 8 6 IHGHUDO LQFRP H WD[ FRQVHTXHQFHVRI DFTXLULQJ RZ QLQJ DQG GLVSRVLQJ RI WKH 1 RWHV ,Q DGGLWLRQ LI VXFK 1 RQ 8 6 + ROGHULVD IRUHLJ Q FRUSRUDWLRQ LWP D\ DOVR EH VXEMHFWWR D EUDQFK SURILWVWD[ HTXDOWR RU VXFK ORZ HUUDWH SURYLGHG E\ DQ\ DSSOLFDEOH WD[ WUHDW\ RI D SRUWLRQ RI LWVHDUQLQJ VDQG SURILWVIRUWKH WD[ DEOH \ HDUWKDWDUH HIIHFWLYHO\ FRQQHFWHG Z LWK LWVFRQGXFWRI D WUDGH RUEXVLQHVVLQ WKH 8 6 VXEMHF WR FHUWDLQ DGMXVWP HQWV
$ ‡GLYLGHQG HTXLYDOHQW· SD\ P HQWLVWUHDWHG DVD GLYLGHQG IURP VRXUFHVZ LWKLQ WKH 8 QLWHG 6 WDWHVDQG VXFK SD\ P HQWVJ HQHUDOO\ Z RXOG EH VXEMHFWWR D 8 6 Z LWKKROGLQJ WD[ LI SDLG WR D 1 RQ 8 6
+ ROGHU 8 QGHU7 UHDVXU\ UHJ XODWLRQV SD\ P HQWV LQFOXGLQJ GHHP HG SD\ P HQWV Z LWK UHVSHFWWR HTXLW\ OLQNHG LQVWUXP HQWV ‡( / ,V· WKDWDUH ‡VSHFLILHG ( / ,V· P D\ EH WUHDWHG DVGLYLGHQG HTXLYDOHQWVLI VXFK VSHFLILHG ( / ,VUHIHUHQFH DQ LQWHUHVWLQ DQ ‡XQGHUO\ LQJ VHFXULW\ ·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
DIIHFWLQJ WKH 8 QGHUO\ LQJ 6 WRFNVRUWKH 1 RWHV DQG IROORZ LQJ VXFK RFFXUUHQFH WKH 1 RWHVFRXOG EH WUHDWHG DVVXEMHFWWR Z LWKKROGLQJ RQ GLYLGHQG HTXLYDOHQWSD\ P HQWV 1 RQ 8 6 + ROGHUVWKDWHQWHU RUKDY HQWHUHG LQWR RWKHUWUDQVDFWLRQVLQ UHVSHFWRI WKH 8 QGHUO\ LQJ 6 WRFNVRUWKH 1 RWHVVKRXOG FRQVXOWWKHLUWD[ DGYLVRUVDVWR WKH DSSOLFDWLRQ RI WKH GLYLGHQG HTXLYDOHQWZ LWKKROGLQJ WD[ LQ WKH FRQWH[ WRI WKH
1 RWHVDQG WKHLURWKHUWUDQVDFWLRQV ,I DQ\ SD\ P HQWVDUH WUHDWHG DVGLYLGHQG HTXLYDOHQWVVXEMHFWWR Z LWKKROGLQJ Z H RUWKH DSSOLFDEOH SD\ LQJ DJ HQWZ RXOG EH HQWLWOHG WR Z LWKKROG WD[ HVZ LWKRXWEHLQJ UHTXLUHG WR SD\ DQ\ DGGLWLRQDODP RXQWVZ LWK UHVSHFWWR DP RXQWVVR Z LWKKHOG
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
8 6 ) HGHUDO( VWDWH 7D[ 8 QGHUFXUUHQWODZ Z KLOH WKH P DWWHULVQRWHQWLUHO\ FOHDU LQGLYLGXDO1 RQ 8 6 + ROGHUV DQG HQWLWLHVZ KRVH SURSHUW\ LVSRWHQWLDOO\ LQFOXGLEOH LQ WKRVH LQGLYLGXDOV¶J URVVHVWDWHVIRU
8 6 IHGHUDOHVWDWH WD[ SXUSRVHV IRUH[ ▇▇ ▇▇▇ D WUXVWIXQGHG E\ VXFK DQ LQGLYLGXDODQG Z LWK UHVSHFWWR Z KLFK WKH LQGLYLGXDOKDVUHWDLQHG FHUWDLQ LQWHUHVWVRUSRZ HUV VKRXOG QRWH WKDWDEVHQWDQ DSSOLFDEOH WUHDW\ EHQHILWD 1 RWH LVOLNHO\ WR EH WUHDWHG DV8 6 VLWXVSURSHUW\ VXEMHFWWR 8 6 IHGHUDOHVWDWH WD[ 7 KHVH LQGLYLGXDOVDQG HQWLWLHVVKRXOG FRQVXOWWKHLURZ Q WD[ DGYLVRUVUHJ DUGLQJ WKH 8 6 IHGHUDOHVWDWH WD[ FRQVHTXHQFHVRI LQYHVWLQJ LQ D 1 RWH
%DFNXS : LWKKROGLQJ DQG ,QIRUP DWLRQ 5 HSRUWLQJ
3 OHDVH VHH WKH GLVFXVVLRQ XQGHU‡8 6 ) HGHUDO,QFRP H 7D[ &RQVLGHUDWLRQV† * HQHUDO† %DFNXS : LWKKROGLQJ DQG ,QIRUP DWLRQ 5 HSRUWLQJ · LQ WKH DFFRP SDQ\ LQJ SURVSHFWXVIRUD GHVFULSWLRQ RI WKH DSSOLFDELOLW\ RI WKH EDFNXS Z LWKKROGLQJ DQG LQIRUP DWLRQ UHSRUWLQJ UXOHVWR SD\ P HQWVP DGH RQ WKH 1 RWHV
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
: KHUH <RX &DQ ) LQG 0 RUH ,QIRUP DWLRQ
7 KH WHUP VDQG ULVNVRI WKH 1 RWHVDUH FRQWDLQHG LQ WKLVSULFLQJ VXSSOHP HQWDQG LQ WKH IROORZ LQJ UHODWHG SURGXFWVXSSOHP HQWSURVSHFWXVVXSSOHP HQWDQG SURVSHFWXV Z KLFK FDQ EH DFFHVVHG DWWKH IROORZ LQJ OLQNV
3 URGXFW6 XSSOHP HQW6 72 &. GDWHG ’ HFHP EHU
KWWSV Z Z Z VHF J RY$ UFKLYHVHGJ DUGDWD G G E KWP
6 HULHV$ 0 7 1 SURVSHFWXVVXSSOHP HQWGDWHG ’ HFHP EHU DQG SURVSHFWXVGDWHG ’ HFHP EHU
KWWSV Z Z Z VHF J RY$ UFKLYHVHGJ DUGDWD G G E KWP
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
‡Z H · ‡XV· ‡RXU· RUVLP LODUUHIHUHQFHVDUH WR %RI$ ) LQDQFH DQG QRWWR %$ &
7 KH 1 RWHVDUH RXUVHQLRUGHEWVHFXULWLHV $ Q\ SD\ P HQWVRQ WKH 1 RWHVDUH IXOO\ DQG XQFRQGLWLRQDOO\ J XDUDQWHHG E\ %$ & 7 KH 1 RWHVDQG WKH UHODWHG J XDUDQWHH DUH QRWLQVXUHG E\ WKH ) HGHUDO’ HSRVLW
,QVXUDQFH &RUSRUDWLRQ RUVHFXUHG E\ FROODWHUDO7 KH 1 RWHVZ LOOUDQNHTXDOO\ LQ ULJ KWRI SD\ P HQWZ LWK DOORI RXURWKHUXQVHFXUHG DQG XQVXERUGLQDWHG REOLJ DWLRQV H[ FHSWREOLJ DWLRQVWKDWDUH VXEMHFWWR DQ\ SULRULWLHVRUSUHIHUHQFHVE\ ODZ 7 KH UHODWHG J XDUDQWHH Z LOOUDQNHTXDOO\ LQ ULJ KWRI SD\ P HQWZ LWK DOORI %$ &¶VRWKHUXQVHFXUHG DQG XQVXERUGLQDWHG REOLJ DWLRQV H[ FHSWREOLJ DWLRQVWKDWDUH VXEMHFWWR DQ\ SULRULWLHVRUSUHIHUHQFHVE\ ODZ DQG VHQLRUWR LWVVXERUGLQDWHG REOLJ DWLRQV $ Q\ SD\ P HQWVGXH RQ WKH 1 RWHV LQFOXGLQJ DQ\ UHSD\ P HQWRI WKH SULQFLSDODP RXQWZ LOOEH VXEMHFWWR WKH FUHGLWULVNRI %RI$
) LQDQFH DV,VVXHU DQG %$ & DV* XDUDQWRU
&2 1 7 , 1 * ( 1 7 , 1 &2 0 ( : , 7 + 0 ( 0 2 5 < ) ( $ 7 8 5 ( $ 8 72 &$ / / $ %/ ( < , ( / ’ 1 2 7 ( 6 _ 36
( [ K
7 K H S U R V S H F W X V W R Z K R I I H U L Q J L V
I L HF 7UKKL
HQ WJ
KP LD V[ I L HP( UX[
LKP QL
JED