africans travel the world-pdf

70
+XPDQLW\ LV %RUQ LQ $IULFD $IULFDQV 7UDYHO WKH :RUOG $ 6WXG\ *XLGH 'HYHORSHG E\ .DED +LDZDWKD .DPHQH DND %RRNHU 7 &ROHPDQ -U 7KLV 6WXG\ *XLGH LV DQ RQJRLQJ 3URFHVV RI %HFRPLQJ ,W LV GHGLFDWHG WR WKH %HORYHG &UHDWRU $QFHVWRUV 2ULJLQDO +XPDQ )DPLO\ 7RGD\¶V +XPDQ )DPLO\ DQG WKH +XPDQ )DPLO\ <HW WR EH %RUQ 7KH *XLGH LV 'LYLGHG LQWR 3DUWV 3DUW ± ,QWURGXFWLRQ WR +XPDQLW\ LV %RUQ LQ $IULFD $IULFDQV 7UDYHO :RUOG ± $ 6\VWHPDWLF 9LHZ RI DQ $IULFDQ &HQWHUHG &XUULFXOXP 3DUW ± )RUW\ 6HDVRQV ± $ )RUW\ <HDU &XUULFXOXP *XLGH 3DUW ± '9' &DWDORJ ±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¶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

Upload: andrae-genus

Post on 27-Dec-2015

52 views

Category:

Documents


0 download

DESCRIPTION

pdf

TRANSCRIPT

����������+XPDQLW\�LV�%RUQ�LQ�$IULFD�������������$IULFDQV�7UDYHO�WKH�:RUOG����������������������$�6WXG\�*XLGH�����������������'HYHORSHG�E\�.DED�+LDZDWKD�.DPHQH��������������������������DND�%RRNHU�7��&ROHPDQ��-U���7KLV�6WXG\�*XLGH�LV�DQ�RQ�JRLQJ�3URFHVV�RI�%HFRPLQJ���,W�LV�GHGLFDWHG�WR�WKH�%HORYHG�&UHDWRU��$QFHVWRUV��2ULJLQDO�+XPDQ�)DPLO\��7RGD\¶V�+XPDQ�)DPLO\�DQG�WKH�+XPDQ�)DPLO\�<HW�WR�EH�%RUQ���7KH�*XLGH�LV�'LYLGHG�LQWR���3DUWV�3DUW���±�,QWURGXFWLRQ�WR�+XPDQLW\�LV�%RUQ�LQ�$IULFD��$IULFDQV�7UDYHO���������������:RUOG�±�$�6\VWHPDWLF�9LHZ�RI�DQ�$IULFDQ�&HQWHUHG�&XUULFXOXP3DUW���±�)RUW\�6HDVRQV�±�$�)RUW\�<HDU�&XUULFXOXP�*XLGH3DUW���±�'9'�&DWDORJ�±�0DWHULDOV�WKDW�6XSSRUW�7KLV�&XUULFXOXP�,QWURGXFWLRQ�WR�$IULFD���2YHUYLHZ&RXUVH�2EMHFWLYHV��7KLV�LV�DQ�LQWURGXFWRU\�FRXUVH�WKDW�EHJLQV�ZLWK�WKH�RULJLQV�RI�+XPDQ�OLIH�LQ�$IULFDQ�SUHVHQFH�LQ�WKH�$VLD���,W�LV�D�FRXUVH�WKDW�H[SORUHV�WKH�FXOWXUDO�FRQWULEXWLRQV�$IULFD�DQG�$IULFDQV�PDGH�WR�WKLV�DQFLHQW�FRQWLQHQW���&LYLOL]DWLRQV�ZLOO�LQFOXGH�WKRVH�RULJLQDWLQJ�LQ�$UDELD��,QGLD��3HUVLD��&KDOGHD��0HGLD��%DE\ORQLD��&KLQD��-DSDQ��9LHWQDP��DQG�PDQ\�RWKHU�SODFHV�LQ�WKH�)DU�(DVW���6WXGHQWV�ZLOO�DOVR�OHDUQ�KRZ�WR�GHYHORS�D�OHVVRQ�SODQ�FHQWHULQJ�RQ�RQH�DVSHFW�RI�WKH�FRXUVH��6WXGHQWV�ZLOO�LPSOHPHQW�LQWHUHVWLQJ�DQG�XQLTXH�WHDFKLQJ�OHDUQLQJ�PHWKRGV��L�H��0XOWLSOH�,QWHOOLJHQFHV��(PRWLRQDO�,QWHOOLJHQFHV�DQG�%ORRP¶V�7D[RQRP\��3DUWLDO�%RRN�/LVW,QWURGXFWLRQ�WR�$IULFDQ�&LYLOL]DWLRQ'U��-RKQ�*��-DFNVRQ&LWDGHO�3UHVV�1�<�������:RQGHUIXO�(WKLRSLDQV�RI�WKH�$QFLHQW�&XVKLWH�(PSLUH'UXVLOOD�'XQMHH�+RXVWRQ%ODFN�&ODVVLF�3UHVV��%DOWLPRUH��0'�����������:KHQ�:H�5XOHG�7KH�:RUOG��5RELQ�:DONHU��(YHU\�*HQHUDWLRQ�0HGLD��8.�������7KH�6WDU�RI�'HHS�%HJLQQLQJV��7KH�*HQHVLV�RI�$IULFDQ�6FLHQFH�DQG�7HFKQRORJ\��&KDUOHV�6��)LQFK��0�'���.KHQWL�,QF���*$��������0HPSKLWH�7KHRORJ\��$QFLHQW�(J\SWLDQ�0\VWLF�:LVGRP�RI�3WDK��0XDWD�$EED\D�$VKE\��&UX]LDQ�0\VWLF�%RRNV��)/��������$IULFDQ�&RVPRORJ\�RI�WKH�%DQWX�.RQJR��.LPEZDQGHQGH�%XQVHNL�)X�.LDX��3+�'���$WKHOLD�+HQULHWWD�3UHVV��&DQDGD�������

��

������������������������������������������������������������������������������&RXUVH�6\OODEXV�&ODVV���±�,QWURGXFWLRQ&ODVV�4XHVWLRQ�±�+RZ�GLG�$IULFD�,PSDFW�WKH�+LVWRU\�RI�WKH�(DUWK"��5HDGLQJV�,QWUR�WR�$IULFD�-*-��-RKQ�*��-DFNVRQ��±�S�����:RQGHUIXO�(WKLRSLDQV�''+��'UXVLOOD�'XQMHH�+RXVWRQ��±�S�L�Y������:KHQ�:H�5XOHG�,QWURGXFWLRQ��3�����$SSHQGL[�±�&KURQRORJLFDO�7DEOH�±�3��������&ODVV���±�2ULJLQ�RI�/LIH�LQ�$IULFD&ODVV�4XHVWLRQ�±�+RZ�DQG�:K\�GLG�/LIH�2ULJLQDWH�LQ�$IULFD"�5HDGLQJV�,QWUR�WR�$IULFD���-*-�±������:RQGHUIXO�(WKLRSLDQV��''+�±�&KDSWHUV����������DQG����S������:KHQ�:H�5XOHG�±�5RELQ�:DONHU��&K����±�³/DQG�RI�WKH�%ODFNV´�±�3����������������������������������������������������������������&K����±�³&UDGOH�RI�WKH�+XPDQ�5DFH´�±�3����������&ODVV���±�7KH�2ULJLQ�RI�WKH�3ODQHW�(DUWK�&ODVV�4XHVWLRQ�±:KDW�,PSDFW�'RHV�&DUERQ����1LWURJHQ����+DYH�RQ�'DWLQJ�������������������������������$UWLIDFWV�DQG�2EMHFWV"�5HDGLQJV��,QWUR�WR�$IULFD��-RKQ�*��-DFNVRQ��S������+XPDQ�'HYHORSPHQW�IURP�DQ�$IULFDQ�$QFHVWU\�*HUDOG�.UDXV��S�;�;9��&LYLOL]DWLRQ�RU�%DUEDULVP��'U��'LRS��S�L[�[YL��������0DQ��*RG�DQG�&LYLOL]DWLRQ��-RKQ�*��-DFNVRQ��S�������/LIH¶V�+LVWRU\�1RWHV��S����&%���%LJ�%DQJ��6XSHUFOXVWHUV��&OXVWHUV��*DOD[LHV��6WDUV��3ODQHWV��2UJDQLF�/LIH������

��

����&ODVV����$JHV�DQG�6WDJHV�RI�WKH�(DUWK��±�3DQJDHD�&RQWLQHQWDO�'ULIW&ODVV�4XHVWLRQ�����$IWHU�WKH�(DUWK�)RUPHG��:KDW�:HUH�WKH�9DULRXV�&KDQJHV�WKDW������������������������������2FFXUUHG"�������������������������������:KDW�$UH�WKH�*HRORJLFDO�(UDV�RI�WKH�(DUWK"�5HDGLQJV�:KHQ�:H�5XOHG��'U��:DONHU��3JV�����������+LVWRU\�RI�$IULFD��'U�$VDQWH��3������������&%�$JHV�DQG�6WDJHV�RI�WKH�(DUWK��&O�������������������������&%�3DQJDHD��&O�������������������������&%�&RQWLQHQWDO�'ULIW��&O����&ODVV�����7KH�0LRFHQH�$JH�2Q�(DUWK&ODVV�4XHVWLRQ��������:KHQ�'LG�WKH�0LRFHQH�$JH�2FFXU�:KDW�+DSSHQHG�'XULQJ������������������������������������7KLV�3HULRG"����������������������������������:KDW�LV�WKH�+LVWRU\�RI�+XPDQLW\¶V�/LIH�'XULQJ��������������������������������������WKH�0LRFHQH�3HULRG"�����������������������������������������������������5HDGLQJV�+XPDQ�'HY���*.��S�������������������/LIH�+LVWRU\�1RWHV��S�����±�+XPDQLW\¶V�$QFHVWRUV�&%�0LRFHQH�$JH��0LWRFKRQGULD�'1$��.LQGV�RI�3ULPDWHV��)RVVLO�0RQNH\V���������$SHV��$SH�)DPLO\�7UHH��$IULFDQ�$SHV��*RULOODV�&ODVV�����*UHDW�/DNHV�5HJLRQ�±�5LIW�9DOOH\�+DSL��1LOH��9DOOH\&ODVV�4XHVWLRQ���������:KHUH�,V�WKH�*UHDW�/DNHV�5HJLRQ�+RZ�'LG�+XPDQ�/LIH�%HJLQ������������������������������������DQG�%HFRPH�/LYLQJ�,Q�7KLV�$UHD"����������������������������������±�:KDW�LV�WKH�*HRJUDSKLFDO�*HRORJLFDO�DQG�$QWKURSRORJLFDO��������������������������������������(YLGHQFH�RI�$IULFDQV�LQ�WKH5LIW�+DSL�1LOH��9DOOH\"�5HDGLQJV�+XPDQ�'HY���*.��S����������������&%�'HYHORSPHQW�RI�+DQGV�DQG�)HHW��'HYHORSPHQW�RI�+DQGV�DQG�'RLQJ�������

��

&ODVV�����+RPLQLG�+RPLQRLG&ODVV�4XHVWLRQ������:KR�$UH�WKH�/LYLQJ�%HLQJV�WKDW�&RPSULVH�WKH����������������������������������+RPLQLG�+RPLQRLG�7UHH"�5HDGLQJV��+XPDQ�'HY���*.��S������������������/LIH�+LVWRU\�1RWHV���$SSHQGL[����*ORJHU��$OOHQ�DQG�%HUJPDQQ¶V�5XOHV��������������������������������������������������S�������������&%�:DONLQJ�8SULJKW��%L�3HGDOLVP��%RGLO\�7UXQN�3URSRUWLRQV��%LSHGDO����������$QDWRP\�DQG�/RFRPRWLRQ��+RPLQLG�/RFRPRWLRQ��3HOYLV�/RZHU�/LPEV�����������+RPLQLG�/RFRPRWLRQ�)RRWSULQWV�DQG�)RRW�%RQHV���&ODVV�����0RUSKRORJLFDO�&KDQJHV�±�)URP�$QLPDO�WR�+XPDQ�&ODVV�4XHVWLRQ�������:KDW�&KDQJHV�,PSDFWHG�3ULPDWHV"�:KDW�LV�WKH�'LIIHUHQFH������������������������������������%HWZHHQ�+RPLQLG�DQG�+RPLQRLG���$QLPDO�WR�+XPDQ�$QLPDO������������������������������������8OWLPDWH�7UDQVIRUPDWLRQ"�5HDGLQJV��6FLHQWLILF�$PHULFD��³7KH�1DNHG�7UXWK�´�S��������1RWHV��S��3RZHU�WR�*UDVS��+LQG�/LPEV��5HFHVVLRQ�RI�6QRXW�5HJLRQ������������������3HUIHFWLRQ�RI�8SULJKW�3RVWXUH���1RWHV��S��������/RVV�RI�7DLO���1RWHV��S����1RWHV��$SSHQGL[��������������������&%�&RPSDUDWLYH�$QDWRP\��7KH�6DYDQQDK�0RVDLF��0HDVXULQJ�7LPH��&ODVV�����$XVWUDORSLWKHFLQHV��5REXVWXV�*UDFLOH&ODVV�4XHVWLRQ������:KR�$UH�WKH�7ZR�0HPEHUV�RI�WKH��VW�+XPDQ�*URXS"����������������������������������:KDW�2FFXUUHG�'XULQJ�7KHLU�/LIH¶V�+LVWRU\"����������������������������������)URP�5REXVW�WR�*UDFHIXO"�������������������������5HDGLQJV�2ULJLQ�RI�+XPDQNLQG��*.��S�L[�[YL��������/LIH�+LVWRU\�1RWHV�±�S�������DQG�����:KDW�LV�WKH�&KURQRORJ\�RI�+XPDQLW\¶V�/LIH�+LVWRU\���������������������������������������6L[�����3K\VLFDO�7UDQVPXWDWLRQV�RI�WKH�+XPDQ�)DPLO\�&%���$XVWUDORSLWKHFLQH�&UDQLDO�DQG�)DFLDO�&RPSDULVRQ��$XVWUDORSLWKHFLQH�����������������������$GDSWDWLRQ��2OGXYDL�*RUJH��/DNH�7XUNDQD��.HQ\D��:HVW�/DNH�7XUNDQD������������������������.HQ\D��$IDU�7ULDQJOH��(WKLRSLD���������������������������

��

&ODVV�������+RPR�/LQH��3DUW���+DELOLV�(UHFWXV�&ODVV�4XHVWLRQ�������:KR�$UH�WKH�7ZR�0HPEHUV�RI�WKH�0LGGOH�+XPDQ�*URXS"����������������������������������:KDW�2FFXUUHG�'XULQJ�WKHLU�/LIH¶V�+LVWRU\��)URP�7RRO�0DNHU�������������������������������������DQ�(UHFW�+XPDQ�%HLQJ"�����5HDGLQJV�±�1DWLRQDO�*HRJUDSKLF��³7KH�(YROXWLRQDU\�5RDG�´�S��������/DHWROL�1RWHV�/LIH�+LVWRU\�1RWHV�S������'HYHORSPHQW�RI�%UDLQ���/LIH�+LVWRU\�1RWHV��S�������DQG������6L[�����3K\VLFDO�7UDQVPXWDWLRQV�RI�WKH�+XPDQ������������������������������������������������������������)DPLO\�&%�+RPLQLG�6LWHV��(DUO\�+RPLQLG�%HKDYLRU��+RPLQLG�/RFRPRWLRQ����������������������$UGLSLWKHFXV�5DPLGXV��/XF\��/DHWROL�)RRWSULQWV��%UDLQ�(YROXWLRQ�6SHFLDO�)RFXV�&ODVV&ODVV������7KH�/DHWROL�)RRWVWHSV�RI�$QFLHQW�7DQ]DQLD����������������������������������������������������������������������³)ROORZLQJ�LQ�WKH�)RRWVWHSV�RI�RXU�$QFHVWRUV���������������������������������������:H�FRXOG�QRW�KDYH�PDGH�LW�ZLWKRXW�WKHP���������������������������������/HDYLQJ�)RRWVWHSV�IRU�RXU��'HVFHQGDQWV�WR�)ROORZ������������������������������������������7KH\�FDQ�QRW�PDNH�LW�ZLWKRXW�XV�´&ODVV�4XHVWLRQ���:KDW�DUH�WKH�/DHWROL�IRRWVWHSV�RI�HDUO\�KXPDQV�IRXQG�LQ�7DQ]DQLD��(DVW�$IULFD"�3XUSRVH����7KH�VWXGHQWV�ZLOO�VWXG\�WKH�DQFLHQW�/DHWROL�IRRWSULQWV�PDGH�E\�HDUO\�KXPDQV�LQ�$IULFD���7KHVH�IRRWSULQWV�WRGD\�XQUDYHO�WKH�TXHVWLRQV�VFLHQWLVWV�KDYH�UHJDUGLQJ�WKH�SURFHVV�RI�OLIH�IURP�DQFLHQW�GD\V�WR�WRGD\¶V�KXPDQ�IDPLO\���$OO�RI�KXPDQLW\�KDV�IROORZHG�LQ�WKHVH�IRRWVWHSV�DQG�FRXOG�QRW�KDYH�PDGH�LW�ZLWKRXW�WKHVH�SHRSOHV�FDOOHG��³$XVWUDORSLWKHFXV�$IDUHQVLV�´�7KH�UHFXUULQJ�WKHPH�LV�WKH�'9'��³7KH�+LVWRULF�-RXUQH\�´�9RFDEXODU\�/LVW�6FLHQFH�±�YROFDQR��FLQGHUV��DQWKURSRORJ\��SDOHRQWRORJ\��DUFKHRORJ\��IRVVLO��KRPLQLG��$XVWUDORSLWKHFXV�$IDUHQVLV��VSHFXODWLRQ*HRJUDSK\�±�/DHWROL��.HQ\D��7DQ]DQLD��8JDQGD��5LIW�9DOOH\��6DGLPDQ��ODWLWXGH��ORQJLWXGH��/DQJXDJH�$UWV���HUHFW��LPSUHVVLRQV��VKXIIOH��DQFHVWRU��GHVFHQGDQW4XHVWLRQV�'HWHUPLQH�ZKDW�WKH�PDLQ�LGHDV�DUH�E\�DQVZHULQJ�WKH�IROORZLQJ�TXHVWLRQV���:KHUH�LV�7DQ]DQLD�LQ�$IULFD�/DWLWXGH�/RQJLWXGH�OLQHV"���:KHUH�LV�/DHWROL�LQ�7DQ]DQLD�/DWLWXGH�/RQJLWXGH�OLQHV"���:KDW�GRHV�LW�PHDQ�WR�IROORZLQJ�LQ�VRPHRQH¶V�IRRWVWHSV"���:KDW�ZRXOG�WKH�VWXGHQW�ZDQW�WR�DFKLHYH�LQ�OLIH�WKDW�ZRXOG�LQVSLUH�IXWXUH�JHQHUDWLRQV����WR�IROORZ�LQ�WKHLU�IRRWVWHSV"��

��

$FDGHPLF�6WDQGDUGV�*HRJUDSK\�±�/RFDWH�7DQ]DQLD�DQG�/DHWROL�LQ�$IULFD��&LWH�WKH�/DWLWXGH�DQG�/RQJLWXGH�����������������������������������������/LQHV+LVWRU\�0DWK�±�8VLQJ�D�7LPHOLQH�1XPEHU�OLQH��LGHQWLI\�WKH�WLPH�SHULRG�ZKHQ�WKHVH�IRRWVWHSV�ZHUH�PDGH�+LVWRU\�&XOWXUH�$QWKURSRORJ\���6WXGHQWV�ZLOO�EH�DEOH�WR�LGHQWLI\�WKH�VSHFLHV�IDPLO\�JURXS�WKDW�PDGH�WKHVH�IRRWVWHSV�6FLHQFH�*HRORJ\�±�6WXGHQWV�ZLOO�UHVHDUFK�YROFDQRHV�DQG�WKH�DVK�UHVLGXH�OHIW�EHKLQG����6WXGHQWV�ZLOO�GHVFULEH�KRZ�IRRWVWHSV�ZHUH�SUHVHUYHG�IRU�RYHU�����PLOOLRQ�\HDUV�6FLHQFH�$UFKHRORJ\�±�6WXGHQWV�ZLOO�FRPSDUH�DQG�FRQWUDVW�$XVWUDORSLWKHFXV�$IDUHQVLV�IHHW�ZLWK�WKH�IHHW�RI�WRGD\V�KXPDQ��+ROLVWLF�$FWLYLW\�([LW�3URMHFW���3URMHFW�LQFOXGHV�D�����:ULWWHQ�(VVD\������*UDSKLF�2UJDQL]HU�DQG�����2UDO�3UHVHQWDWLRQ�/DQJXDJH�$UWV��)LJXUDWLYH�/DQJXDJH��)ODVKEDFN�)RUHVKDGRZ��±�6WXGHQWV�ZLOO�UHVHDUFK�WKH�/DHWROL�IRRWVWHSV��GHVFULELQJ�KRZ�DOO�KXPDQV�KDYH�IROORZHG�LQ�WKH�IRRWVWHSV�RI�HDUO\�KXPDQV�LQ�$IULFD���7KLV�DFWLYLW\�ZLOO�FRQFOXGH�ZLWK�WKH�VWXGHQWV�GHVFULELQJ�WKH�/HJDF\�WKH\�SODQ�WR�OHDYH�IRU�IXWXUH�JHQHUDWLRQV�WR�IROORZ�DQG�FRPSOHWH���6WXGHQWV�ZLOO�FRPSDUH�DQG�FRQWUDVW�WKH�VWRU\�WROG�LQ�WKH�'9'��³7KH�+LVWRULF�-RXUQH\�´�%DFNJURXQG�,QIRUPDWLRQ�±�/DHWROL�)RRWVWHSV������7KH�/DHWROL�IRRWVWHSV�DUH�ORFDWHG�DERXW�WKLUW\������PLOHV�VRXWK�RI�2OGXYDL���2I�DOO�WKH�IRVVLO�VLWHV�LQ�WKH�5LIW�V\VWHP��/DHWROL�KDV�DOZD\V�EHHQ�WKH�RGG�RQH���/DHWROL�ZDV�GU\�WKHQ�DQG�JUHHQHU�QRZ���7RGD\�WKHUH�DUH�VHYHUDO�VPDOO�ODNHV�LQ�LWV�YLFLQLW\�DQG�D�JRRG�GHDO�RI�YHJHWDWLRQ���/DHWROL�KDV�DWWUDFWHG�VWXGHQWV�RI�WKH�DQFLHQW�ZRUOG�IRU�PRUH�WKDQ�IRUW\�\HDUV�EHFDXVH�LWV�GHSRVLWV�ZHUH�E�EHOLHYHG�WR�EH�YHU\�ROG���7KH�KRPLQLG�IRVVLOV�KDYH�EHHQ�GDWHG�WR�EH�DSSUR[LPDWHO\�����PLOOLRQ�\HDUV�ROG���/DHWROL�ZDV�WKH�ILUVW�SODFH�ZKHUH�DQ�DGXOW�$XVWUDORSLWKHFLQH�WRRWK�HYHU�IRXQG���:KDW�VHW�/DHWROL�DSDUW�IURP�WKH�RWKHU�VLWHV�LQ�WKH�ZRUOG�DUH�VRPH�IRRWSULQWV�WKDW�KDYH�EHHQ�IRXQG�WKHUH������/DHWROL�KDV�D�QHDUE\�YROFDQR��³6DGLPDQ�´��,W�LV�H[WLQFW�WRGD\���$ERXW�IRXU�����PLOOLRQ�\HDUV�DJR�LW�ZDV�DFWLYH���2QH�GD\�LW�VSDW�RXW�D�FORXG�RI�FDUERQLWH�DVK���7KLV�VWXII�KDV�D�FRQVLVWHQF\�QRW�XQOLNH�WKDW�RI�YHU\�ILQH�EHDFK�VDQG��DQG�LW�SRZGHUHG�GRZQ�RYHU�WKH�VXUURXQGLQJ�ODQGVFDSH�LQ�D�OD\HU�WKDW�UHDFKHG�D�WKLFNQHVV�RI�DERXW�KDOI�DQ�LQFK�EHIRUH�WKH�HUXSWLRQ�VWRSSHG���7KLV�IDOO�RI�VXSHUILQH�FLQGHUV�PXVW�KDYH�EHHQ�H[WUHPHO\�XQSOHDVDQW�IRU�WKH�ORFDO�DQLPDOV�DQG�ELUGV�ZKLOH�LW�ZDV�FRPLQJ�GRZQ��EXW�WKHUH�LV�QR�HYLGHQFH�WKDW�LW�GLG�PRUH�WKDQ�PDNH�WKHP�XQFRPIRUWDEOH��E�EHFDXVH�WKH\�VWD\HG�LQ�WKH�DUHD���7KDW�ILUVW�SXII�RI�DVK�±�SUREDEO\�QRW�ODVWLQJ�PRUH�WKDQ�D�GD\�±�ZDV�IROORZHG�E\�D�UDLQ���7KH�DVK�EHFDPH�ZHW�DQG��DOPRVW�OLNH�D�QHZO\�ODLG�FHPHQW�VLGHZDON��EHJDQ�WDNLQJ�FOHDU�LPSUHVVLRQV�RI�HYHU\WKLQJ�WKDW�ZDONHG�DFURVV�LW���HOHSKDQWV��JLUDIIHV��DQWHORSHV��KDUHV��UKLQRV��SLJV���7KHUH�ZHUH�DOVR�WHUUHVWULDO�ELUGV�OLNH�JXLQHD�IRZO�DQG�RVWULFKHV��DQG�HYHQ�WKH�VPDOO�WUDFNV�RI�PLOOLSHGHV���

��

�����+RZHYHU��E\�D�ZLOGO\�LPSUREDEOH�OLQNDJH�RI�HYHQWV��WKHVH�IRRWSULQWV�ZHUH�PDGH���6DGLPDQ�KDG�WR�EORZ�RXW�D�SDUWLFXODU�NLQG�RI�DVK���5DLQ�KDG�WR�IDOO�RQ�LW�DOPRVW�LPPHGLDWHO\���+RPLQLGV�KDG�WRS�IROORZ�RQ�WKH�KHHOV�RI�WKH�UDLQ���7KH�VXQ�KDG�WR�FRPH�RXW�SURPSWO\�DQG�KDUGHQ�WKHLU�IRRWSULQWV��7KHQ�DQRWKHU�EODVW�IURP�6DGLPDQ�KDG�WR�FRYHU�DQG�SUHVHUYH�WKHP�EHIRUH�DQRWKHU�REOLWHUDWLQJ�VKRZHU�FDPH�DORQJ���$OO�WKLV�KDG�WR�KDSSHQ�RYHU�D�SHULRG�RI�RQO\�D�IHZ�GD\V���$OO�WKLQJV�FRQVLGHUHG��WKH�SUHVHUYDWLRQ�DQG�UHFRYHU\�RI�WKH�/DHWROL�IRRWSULQWV�DUH�QRWKLQJ�VKRUW�RI�D�PLUDFOH���7KH\�FRQILUP�WKDW�KRPLQLGV�ZHUH�IXOO\�HUHFW�ZDONHUV�DW�WKUHH�PLOOLRQ�\HDUV�%HIRUH�WKH�&KULVWLDQ�(UD�DQG�HYHQ�SRVVLEO\�HDUOLHU�����7KH�IRRWSULQWV�DUH�OLNH�PRGHUQ�KXPDQ�IRRWSULQWV���7KHUH�LV�ZHOO�VKDSHG�PRGHUQ�KHHO�ZLWK�D�VWURQJ�DUFK�DQG�D�JRRG�EDOO�RI�WKH�IRRW�LQ�IURQW�RI�LW���7KH�ELJ�WRH�LV�VWUDLJKW�LQ�OLQH���,W�GRHVQ¶W�VWLFN�RXW�WR�WKH�VLGH�OLNH�DQ�DSH�WRH��RU�OLNH�WKH�ELJ�WRH�LQ�VR�PDQ\�GUDZLQJV�\RX�VHH�RI�DXVWUDORSLWKHFLQHV���7KH�KRPLQLGV�RI�/DHWROL�ZHUH�LPSHUIHFW�ZDONHUV�EHFDXVH�WKH�IRRWSULQWV�VKRZ�WKDW�WKH\�ZDONHG�ZLWK�D�VKXIIOH���7KH�GLUHFWLRQ�RI�WKH�SULQWV�LQGLFDWH�WKDW�WKHLU�PDNHU�KDG�EHHQ�ZDONLQJ�QRUWK�XQGHU�VRPH�VHFWLRQV�RI�ODQG�WKDW�KDG�QRW�\HW�EHHQ�HURGHG���7KHUH�ZHUH�WZR�KRPLQLGV��WKH\�ZHUH�SUREDEO\�ZDONLQJ�WRJHWKHU��RQH��ZLWK�VOLJKWO\�ODUJHU�SULQWV��ZDV�D�PDOH��WKH�RWKHU��SRVVLEO\�SUHJQDQW��ZDV�D�IHPDOH���7KH\�SUREDEO\�KDG�EHHQ�HUHFW�ZDONHUV�IRU�DW�OHDVW�D�PLOOLRQ�\HDUV��������$OO�RI�WKLV�LV�VSHFXODWLRQ��WKHUH�LV�VWLOO�D�ORW�PRUH�UHVHDUFK�WR�EH�GRQH���$UH�\RX�LQWHUHVWHG�LQ�DUFKHRORJ\��SDOHRQWRORJ\�RU�DQWKURSRORJ\"��+RZ�DERXW�$IULFDQ�+LVWRU\"�����)ROORZ�LQ�WKH�IRRWVWHSV�RI�\HVWHUGD\¶V�VFLHQWLVWV�DQG�VWXG\�WKH�SDVW���<RX�FDQ¶W�PDNH�LW�ZLWKRXW�WKHP«/HDYH�\RXU�LQWHOOHFWXDO�IRRWVWHSV�EHKLQG���<RXU�SUHVHQW�EHFRPHV�\RXU�GHVFHQGDQW¶V�SDVW���7KHLU�SUHVHQW�ZLOO�EH�\RXU�IXWXUH���:H�FDQ¶W�PDNH�LW�ZLWKRXW�HDFK�RWKHU����

/LIH�+LVWRU\�RI�+XPDQ�)DPLO\������3UHKLVWRU\�LV�VXFK�WKDW�DOO�WKDW�LV�ZULWWHQ�DERXW�LW��DOO�WKHRULHV��DQG�DOO�WKHVHV�DUH�RI�QHFHVVLW\�SURYLVLRQDO�DQG�SUHOLPLQDU\���7KHVH�WKHRULHV�DG�WKHVHV�DUH�DUULYHG�DW�E\�IRVVLOV������7HFKQLFDOO\��D�IRVVLO�PD\�EH�DQ\�HYLGHQFH�RI�>SDVW�OLIH���%XW��ZHUH�PDPPDOV�DUH�FRQFHUQHG��VXFK�HYLGHQFH�DOPRVW�DOZD\V�FRQVLVWV�RI�ERQHV�DQG�WHHWK��WKH�PRVW�GXUDEOH�WLVVXHV�RI�WKH�ERG\���)RVVLOV�PD\�EH�GDWHG�RQH�RI�WZR�ZD\V���������7KH\�PD\�EH�DVVLJQHG�DQ�DJH�LQ�\HDUV���<HDU�GDWHV�DUH�JHQHUDOO\�REWDLQHG�IURP�WKH�URFNV�LQ�ZKLFK�WKH�IRVVLOV�DUH�IRXQG�UDWKHU�WKDQ�IURP�WKH�IRVVLOV�WKHPVHOYHV���������7KH\�PD\�EH�SODFHG�UHODWLYH�WR�HDFK�RWKHU�,�WKH�XQIROGLQJ�VHTXHQFH�RI�JHRORJLFDO�HYHQWV��7KHUH�DUH�WZR�����PHWKRGV�RI�GDWLQJ�IRVVLOV����������&DUERQ����1LWURJHQ����GDWLQJ�LV�XVHIXO�RQO\�LQ�IRVVLOV�OHVV�WKDQ��������\HDUV�RI�DJH�����7KLV�UDGLR�FDUERQ�GDWLQJ�LV�EDVHG�XSRQ�WKH�IDFW�WKDW�DOO�OLYLQJ�RUJDQLVPV�DVVLPLODWH�WKH�UDGLRDFWLYH�LVRWRSH�RI�&DUERQ��&����DW�D�IL[HG�UDWH�GXULQJ�WKHLU�OLIHWLPHV���7KH�DVVLPLODWLRQ�RI�WKH�LVRWRSH�FHDVHV�DW�GHDWK���7KLV�LVRWRSH�KDV�D�KDOI�OLIH�RI�������\HDUV��JLYH�RU�WDNH����\HDUV���7KHUHIRUH��E\�PHDVXULQJ�WKH�DPRXQW�RI�&���UHPDLQLQJ�LQ�D�VDPSOH�RI�RUJDQLF�VXEVWDQFH��D�GHWHUPLQDWLRQ�PD\�EH�PDGH�DV�WR�WKH�QXPEHU�RI�\HDUV�ZKLFK�KDYH�HODSVHG�VLQFH�WKH�GHDWK�RI�WKH�RUJDQLVP�IURP�ZKLFK�WKH�VDPSOHV�RULJLQDWHG���7KH�

��

WHFKQLTXH�LV�XVHIXO�IRU�PHDVXULQJ�WKH�DJHV�RI�ERQH�VDPSOHV��ZRRG�IUDJPHQWV��FHUHDO�JUDLQ�HWF����������3RWDVVLXP���$UJRQ����GDWLQJ�LV�XVHG�IRU�URFNV�ROGHU�WKDQ���������\HDUV�RI�DJH�������%RWK�WHFKQLTXHV�DVVHVV�WKH�GHFD\�RI�QDWXUDOO\�RFFXUULQJ�UDGLRDFWLYH�LVRWRSHV��ZKLFK�WDNHV�SODFH�DW�YHU\�VWHDG\�UDWHV���1RW�DOO�IRVVLOV�FDQ�EH�UDGLRDFWLYHO\�GDWHG��DQG�WKHLU�DJH�PXVW��WKHUHIRUH��EH�HVWLPDWHG�E\�JHRORJLFDO�DQG�SDOHRQWRORJLFDO�FRPSDULVRQV�ZLWK�RWKHU�UHJLRQV������7KH�ROGHVW�IRVVLOV�RI�WKH�KXPDQ�IDPLO\�ZHUH�ORFDWHG�LQ�$IULFD���$XVWRORSLWKHFXV�$UGL«/XF\��QDPHG��³'DQNQHVK�´�E\�WKH�LQGLJHQRXV�$IULFDQV��/XF\���7KH�%HJLQQLQJV�RI�+XPDQNLQG��'RQDOG�-RKDQVVRQ�DQG�0DLWODQG�(GH\���6LPRQ�DQG�6FKXVWHU��1<����������'DQNQHVK¶V�LPSRUWDQFH�LQ�SDOHRQWRORJ\�UHVHWV�RQ�WZR�����IDFWRUV���������6KH�KDV�EHHQ�GDWHG�WR�EH�����PLOOLRQV�\HDUV�RI�DJH���������������+HU�VNHOHWRQ�LV�WKH�PRVW�FRPSOHWH�HYHU�IRXQG�RI�DQ\�KRPLQLG�ROGHU�WKDQ��������\HDUV�RI�DJH�������%XW��WR�WUXO\�LQYHVWLJDWH�WKH�OLIH�KLVWRU\�RI�WKH�KXPDQ�IDPLO\��LW�PXVW�EH�XQGHUVWRRG�WKDW�ZH�PXVW�VWXG\�WKH�PXOWL�OD\HUHG�GLVFLSOHV�RI�DQWKURSRORJ\��SUH�KLVWRU\�DQG�SRSXODWLRQ�JHQHWLFV�WKDW�VRPH�FUXFLDO�OLQHV�RI�HYLGHQFH�DUH�EHLQJ�SXUVXHG��KDOI�KLGGHQ�IURP�WKH�YLHZ�RI�WKH�HQOLJKWHQHG�SXEOLF��ZKLFK�VHHN�WR�PLQLPL]H��XQGHUPLQH�DQG�QHJDWH�WKH�$IULFDQ�FRQWULEXWLRQ�WR�KXPDQLW\��&LYLOL]DWLRQ�RU�%DUEDULVP��'U��&KLHNK�$QWD�'LRS������+XPDQNLQG�ZDV�ERUQ�XQGHU�WKH�ODWLWXGH�RI�WKH�*UHDW�/DNHV�5HJLRQ�>�.HQ\D��8JDQGD�DQG�7DQJDQ\LND����7DQ]DQLD� �WKH�FRXQWU\�RI�7DQJDQ\LND���WKH�LVODQG�RI�=DQ]LEDU@��DOPRVW�XQGHU�WKH�(TXDWRU��LV�QHFHVVDULO\�SLJPHQWHG�DQG�$IULFDQ��*ORJHU¶V�/DZ�UHTXLUHV�WKDW�ZDUP�EORRGHG�DQLPDOV�EH�SLJPHQWHG�LQ�D�ZDUP�FOLPDWH���$OO�RWKHU�UDFHV�DUH�GHVFHQGHG�IURP�WKH�$IULFDQ�UDFH�E\�PRUH�RU�OHVV�GLUHFW�UHODWLRQVKLS�DQG�WKH�RWKHU�FRQWLQHQWV�ZHUH�SRSXODWHG�IURP�$IULFD��DV�PXFK�DW�WKH�WLPH�RI�+RPR�HUHFWXV�DV�+RPR�VDSLHQV�DQG�+RPR�6DSLHQV�6DSLHQV��ZKR�DSSHDUHG�DURXQG���������\HDUV�DJR���WKH�HDUOLHU�WKHRULHV�ZKLFK�PDGH�+XPDQV�FRPH�IURP�VRPHZKHUH�HOVH�DUH�QR�ORQJHU�YDOLG���$IULFD�LV�WKH�RQO\�FRQWLQHQW�ZKHUH�WKHUH�LV�HYLGHQFH��LQ�XQEURNHQ�FKURQRORJLFDO�VHTXHQFH��RI�DOO�VWDJHV�LQ�WKH�GHYHORSPHQW�RI�PDQ������7KH�ROGHVW�DQG�PRVW�QXPHURXV�KXPDQ�DQG�SUH�KXPDQ�IRVVLOV�DUH�IRXQG�SULQFLSDOO\�,�WKH�*UHDW�5LIW�9DOOH\��ZKLFK�H[WHQGV�IURP�VRXWKHUQ�=DPELD��WKURXJK�(WKLRSLD�DQG�LQWR�SUHVHQW�GD\�,VUDHO���\HVWHUGD\�LW�ZDV�³3DOHVWLQH´��GD\�EHIRUH�\HVWHUGD\�³&DQDDQ´���,Q�WKLV�YDOOH\�DUH�WKH�2OGXYDL��2PR�DQG�+DGDU�IRVVLO�VLWHV��WKH�ULFKHVW�VXFK�VLWHV�LQ�WKH�ZRUOG�������

��

��+XPDQLW\¶V�/LIH�+LVWRU\�DQG�WKH�0LRFHQH�3HULRG������7KH�0LRFHQH�3HULRG��EHJLQQLQJ�DERXW����PLOOLRQ�\HDUV�DJR��ZDV�NQRZQ�DV�WKH��³3HULRG�RI�WKH�$SH�´��7KH�/LIH�+LVWRU\�RI�WKH�KXPDQ�UDFH�EHJDQ�LQ�WKH�0LRFHQH��DSSUR[LPDWHO\�������PLOOLRQ�\HDUV�DJR���'XULQJ�WKH�0LRFHQH��WKH�HDUWK�ZDV�ODUJHO\�FRYHUHG�ZLWK�OX[XULRXV�IRUHVWV���7ZR�PDMRU�OLQHV�RI�DGYDQFHG�SULPDWHV�FR�H[LVWHG��DSH�WHQGLQJ�SRQJLGV�DQG�PDQ�WHQGLQJ�KRPLQLGV���'XULQJ�WKLV�SHULRG��WKH�SRQJLGV�ZHUH�VXSHULRU�WR�WKH�KRPLQLGV���7KH�DSHV�SUROLIHUDWHG�PLJKWLO\�DQG�VSUHDG�DOO�RYHU�$IULFD��KRPLQLGV�ZHUH�ZHOO�GRZQ�WKH�URDG�WR�H[WLQFWLRQ���3RQJLGV�HDJHUO\�DGDSWHG�WR�WKH�IRUHVW�ZRUOG�ZKLOH�KRPLQLGV�UHPDLQHG�VWXEERUQO\�SULPLWLYH���7KHUH�LV�OLWWOH�GRXEW�WKDW�LI�WKH�0LRFHQH�KDG�ODVWHG�ORQJHU��WKH�KRPLQLGV�ZRXOG�KDYH�SHULVKHG�HQWLUHO\���%XW��LW�GLG�QRW�ODVW���7KH�0LRFHQH�3HULRG�EHFDPH�WKH�3OLRFHQH�SHULRG��QHLWKHU�WKH�SRQJLGV��QRU�WKH�KRPLQLGV�KDG�WKH�OHDVW�UHVSRQVLELOLW\�IRU�WKH�FKDQJH���7KH�ZRUOG¶V�FOLPDWH�DOWHUHG���$W�WKLV�SRLQW��WKH�HDUWK�HQWHUHG�D�GURXJKW�PLOOLRQV�RI�\HDUV�ORQJ���)RUHVWV�GZLQGOHG�DQG�WKH�SRQJLGV�VZLQGOHG�ZLWK�WKHP���%\�WKH�VKHHUHVW�DFFLGHQW��KRPLQLG�OLDELOLWLHV�GXULQJ�WKH�0LRFHQH�EHFDPH�DVVHWV�GXULQJ�WKH�3OLRFHQH���,W�LV�RIWHQ�VDLG�WKDW�RXU�IDLOXUH�WR�DGDSW�WKH�IRUHVWV�OHIW�RXU�DGDSWLRQDO�RSWLRQV�RSHQ�IRU�WKH�QHZ�HQYLURQPHQWDO�FRQGLWLRQV�RI�WKH�3OLRFHQH�?���,W�LV�WUXHU�WR�VD\�WKDW�WKH�FRQGLWLRQV�RI�WKH�3OLRFHQH�KDSSHQHG�WR�IDYRU�RXU�SULPLWLYH�FKDUDFWHULVWLFV���+XPDQV�DUH�SULPLWLYH�DQG�XQVSHFLDOL]HG�SULPDWHV���7KH�DQWKURSRLG�DSHV�KDYH�IRXU�����JHQHUD��JLEERQ��RUDQJXWDQ��FKLPSDQ]HH�DQG�JRULOOD���7KH�JLEERQ�DQG�RUDQJXWDQ�DQWKURSRLGV�KDYH�WUDFH�EDFN�WR�WKH�2OLJRFHQH��KDYLQJ�GHYHORSHG�IURP�VPDOO�7DUVRLGV�RI�WKH�(RFHQH���7KH�DQWKURSRLG�DQFHVWRUV�RI�WKH�JLEERQ��RUDQJXWDQ��FKLPS��JRULOOD�DQG�PDQ��EUDQFKHG�IURP�WKH�FRPPRQ�DSH�VWRFN�DERXW����PLOOLRQ�\HDUV�DJR��LQ�WKH�0LRFHQH�3HULRG���0DQ�GHVFHQGHG�IURP�D�0LRFHQH�$SH�OLNH�$QFHVWRU���:H�ILQG�WKH�ILUVW�WUDFHV�RI�KXPDQ�IRVVLOV�LQ�WKH�3OLRFHQH�SHULRG��DIWHU�ZKLFK�FDPH�WKH�3OHLVWRFHQH�SHULRG��,FH�$JH���+XPDQLW\¶V�$QFHVWRU�±�+80$1,7<¶6�$1&(6725������6RPHZKHUH�EHWZHHQ����DQG���PLOOLRQ�\HDUV�DJR��LW�LV�WKHRUL]HG�WKDW�+XPDQLW\¶V�PRVW�DQFLHQW�DQFHVWRU�PRYHG�DOPRVW�HQWLUHO\�RXW�RI�WKH�IRUHVW�DQG�LQWR�RSHQ�VDYDQQDK���,Q�VR�GRLQJ��WKH\�EHFDPH�HQWLUHO\�XSULJKW��EL�SHGDO�ZDONHUV��D�XQLTXH�GHYHORSPHQW�LQ�SULPDWH�JURZWK���:KHQ�RXU�DQFHVWRU�HPHUJHG�DV�D�JURXQG�GZHOOHU��KH�VKH�GLIIHUHG�IURP�WKH�RWKHU�JURXQG�GZHOOLQJ�DSHV�E\�EHLQJ�PRUH�ZLOOLQJ�WR�YHQWXUH�LQWR�WKLV�RSHQ�VDYDQQDK���7KLV�OHG�WR�KLV�KHU�GLHWDU\�FKDQJH���7KLV�FKDQJH�ZDV�UHIOHFWHG�LQ�WKH�PRUSKRORJ\�RI�WKHLU�EDFN�WHHWK���7KHVH�GLHWDU\�DQG�KDELWDW�FKDQJHV�DOVR�OHG�WR�VHOHFWLRQ�SUHVVXUHV�WKDW�FDXVHG�FKDQJHV�LQ�RWKHU�SDUWV�RI�WKHLU�VNHOHWRQ�VXFK�DV��DUPV��OHJV��SHOYLF�JLUGOH�DQG�VNXOO���:H�FDQ�VHH�WKLV�LQ�WKH�JURXQG�GZHOOLQJ�DSHV�E\�WKH�DUERUHDO�DSHV�DQG�LQ�RXU�DQFHVWRU�E\�RWKHU�JURXQG�GZHOOLQJ�DSHV���2XU�DQFHVWRU��ZKLOH�KDYLQJ�PDQ\�SRQJLG�IHDWXUHV��GLIIHUHG�IURP�WKH�WUXH�SRQJLGV��HQRXJK�WR�EH�FRQVLGHUHG�WKH�ILUVW�KRPLQLG�RU�SURWR�KRPLQLG���7KH�HDUOLHVW�VSHFLPHQ�RI�RXU�DQFHVWRU�ZDV�IRXQG�LQ�2OGXYDL�*RUJH�LQ�7DQ]DQLD�WKRXJK�RWKHUV�ZHUH�IRXQGHG�IURP�D�ODWHU�SHULRG�LQ�$VLD�DQG�(XURSH���2XU�DQFHVWRU�UHSUHVHQWV�DQ�HDUO\�

��

HYROXWLRQDU\�GLYHUJHQFH�IURP�SRQJLGV���%HIRUH�ZH�JR�WKURXJK�WKH�HYROXWLRQDU\�SDWK��OHW�XV�H[DPLQH�D�K\SRWKHVLV�RI�KRZ�WKLV�GLYHUJHQFH�VKRZHG�LWVHOI�LQ�WKH�GHYHORSPHQW�RI�KXPDQ�PRUSKRORJ\���7R�GR�WKLV��ZH�PXVW�UHWXUQ�WR�WKH�7ULDVVLF�SHULRG�RI�WKH�0HVR]RLF�$JH��)URP�$QLPDO�WR�+XPDQ�$QLPDO���7KH�8OWLPDWH�7UDQVIRUPDWLRQ������$Q�DQWKURSRORJ\�VWXGHQW�RI�ZRUOG�UHQRZQHG�HGXFDWRU��3URIHVVRU�:LOOLDP�/HR�+DQVEHUU\�RI�+RZDUG�8QLYHUVLW\��ZURWH�D�SDSHU�GDWHG��'HFHPEHU������������+H�WLWOHG�KLV�ZRUN��³$�'LVFXVVLRQ�RI�WKH�0RUSKRORJLFDO�DQG�3K\VLRORJLFDO�&KDQJHV�WKDW�$UH�6XSSRVHG�WR�+DYH�7DNHQ�3ODFH�LQ�WKH�7UDQVIRUPDWLRQ�RI�$SH�/LNH�&UHDWXUHV�WR�0DQ�´��:H�ZRXOG�OLNH�WR�KLJKOLJKW�VRPH�RI�WKH�LPSRUWDQW�LGHDV�SUHVHQWHG�LQ�WKLV�SDSHU�6RPHWLPH�LQ�WKH�7ULDVVLF�3HULRG��WKHUH�OLYHG�LQ�6RXWK�$IULFD�D�JURXS�RI�DQLPDOV�FDOOHG��³7KHUDSVLGDH´���7KHVH�DQLPDOV�SUHVHQWHG�D�EOHQG�RI�SULPLWLYH�UHSWLOLDQ�DQG�SULPLWLYH�PDPPDOLDQ�FKDUDFWHULVWLFV���7KH\�OLYHG�PDLQO\�LQ�WKH�ZDWHU��EXW��ZHUH�FDSDEOH�RI�VXUYLYLQJ�RQ�ODQG���7KH\�SRVVHVVHG��OLNH�DOO�UHSWLOHV�DQG�PDPPDOV��IRXU�����OLPEV��EXW��WKH\�ZHUH�VKRUW�DQG�PRELOH��FDSDEOH�RI�SURGXFLQJ�PRWLRQ��EXW��QRW�RI�VXSSRUWLQJ�WKH�ZHLJKW�RI�WKH�ERG\������$V�WLPH�SDVVHG�WKHVH�DQLPDOV��IRU�UHDVRQV�XQNQRZQ��HLWKHU�YROXQWDU\�RU�LQYROXQWDU\��WRRN�WR�D�WHUUHVWULDO�KDELWDW���,Q�DQ�DWWHPSW�WR�DGDSW�WKHPVHOYHV�WR�WKH�QRZ�FRQGLWLRQV�DQG�HQYLURQPHQW��LWV�RUJDQV�DQG�OLPEV�EHJDQ�WR�VSHFLDOL]H�VR�WR�VXSSRUW�WKH�ERG\�DQG�FDUU\�LW�FOHDU�RII�WKH�JURXQG���%XW��LQ�GRLQJ�WKLV��VWDELOLW\�ZDV�JDLQHG�DQG�PRELOLW\�ZDV�ORVW���6XFFHVVIXO�WKRXJK�LW�ZDV��WKLV�IHDW�ZDV�YHU\�JUDGXDO���7KH�OLPEV��DW�ILUVW��VXSSRUWHG�WKH�ERG\��RQO\�GXULQJ�WKH�DFW�RI�SURSHOOLQJ���,WV�ERG\�VXQN�WR�WKH�JURXQG�ZKHQ�SURJUHVVLRQ�ZDV�FRPSOHWHG���6RRQ�WKH�OLPEV�EHFDPH�VWURQJ�HQRXJK�WR��VXSSRUW�WKH�ERG\�FRQWLQXRXVO\�DQG�KHQFH�VWDELOLW\�EHFDPH�IL[HG���$V�VWDELOLW\�EHFDPH�IL[HG��KRZHYHU��WKH�OLPEV�JUDGXDOO\�EHFDPH�OHVV�PRELOH���7KH\�KDG�EHHQ�FDSDEOH�RI�PRYLQJ�LQ�DQ\�GLUHFWLRQ��EXW�QRZ�ZHUH�RQO\�DEOH�WR�PRYH�LQ�D�IRUZDUG��EDFNZDUG�PRWLRQ���7KLV�FUHDWXUH�EHFDPH�WKH�DQFHVWRU�RI�WKH�TXDGUXSHGV�RU�SURQRJUDGH�DQLPDOV���%XW��QRW�DOO�RI�WKH�7HUDSVLGDH�VSHFLHV�IROORZHG�WKH�DERYH�FRXUVH���6RPH��ZKLOH�UHWXUQLQJ�WKH�PRELOH�OLPEV��WRRN�WR�FOLPELQJ��ILUVW�RYHU�REMHFWV�LQ�WKH�SDWKZD\��DQG�WKHQ�LQ�EXVKHV�DQG�WUHHV���,Q�WKH�FOLPELQJ�SURFHVV��WKH�DQLPDOV�UHDFKHG�DKHDG�ZLWK�RQH�RU�WKH�RWKHU�RI�WKH�PRELOH�IRUH�OLPEV�IRU�D�QHZ�JUDVS���:KLOH�GRLQJ�WKLV��WKH�ZHLJKW�RI�WKH�ERG\�ZDV�WHPSRUDULO\�VKLIWHG�WR�WKH�KLQG�OLPEV���6LPXOWDQHRXVO\��EHFDPH�VSHFLDOL]HG�IRU�VXSSRUWLQJ�RUJDQV�DQG�EHFDPH�VWDEOH���7KH�ILUVW�SDUW�RI�WKLV�LV�FDOOHG��³7KH�HPDQFLSDWLRQ�RI�WKH�IRUH�OLPEV�´��7KLV�KDELW�RI�FOLPELQJ�VDYHG�WKH�IRUH�OLPEV�WKHLU�PRELOLW\�DQG�SUHYHQWHG�WKHP�IURP�EHFRPLQJ�RUJDQV�RI�PRUH�VWDELOLW\���,W�DOVR�KDQGHG�WKHP�RYHU�IRU�IXUWKHU�DGDSWDWLRQ�RI�WKH�LQKHUHQW�SRWHQWLDOLWLHV���,W�ZDV�VXFK�D�FRQGLWLRQ�DV�WKLV��WKDW�NHSW�WKH�VWRFN�ZKLFK�FXOPLQDWHG�LQ�PDQ�IURP�EHFRPLQJ�D�IRXU�OHJJHG�SURQRJUDGH�DQLPDO��DQG�JDYH�WR�KLV�KHU�SDUWLFXODU�VWRFN�VXFK�SRWHQWLDOLWLHV�DV�DIWHUZDUGV�GHYHORSHG�DQG�PDGH�KLP�OHDGHU�RI�WKH�ZRUOG������7KH�VSHFLILF�PRUSKRORJLFDOO\�DQG�SK\VLRORJLFDO�RFFXUUHQFHV�JURZLQJ�LQ�IXOO�RU�LQ�SDUW��RXW�RI�WKHVH�DUERUHDO�KDELWV�ZKLFK�FRXQWHG�PRVW�LQ�WKH�GHYHORSPHQW�WRZDUGV�PDQ�ZHUH�DV�IROORZV�WKH��

���

���'HYHORSPHQW�RI�WKH�SRZHU�WR�JUDVS���'HYHORSPHQW�RI�WKH�KLQG�OLPEV�DV�VXSSRUWLQJ�DQG�EDODQFLQJ�RUJDQV��DQG�WKH�ORVV�RI�WKH����SUHKHQVLOH��ZUDS�DURXQG�DGDSWHG�IRU�VHL]LQJ�RU�KROGLQJ��FKDUDFWHU�RI�WKH�JUHDW�WRH�����5HFHVVLRQ�RI�WKH�VQRXW�UHJLRQV�DQG�PRGLILFDWLRQV�LQ�WKH�VKDSH�RI�WKH�VSLQH�DQG�EDVH�RI�WKH�VNXOO����3HUIHFWLRQ�RI�WKH�XS�ULJKW�SRVWXUH����/RVV�RI�WKH�WDLO����/RVV�RI�ERG\�KDLU���(YROXWLRQ�RI�WKH�KXPDQ�EUDLQ����7KH�'HYHORSPHQW�RI�WKH�3RZHU�WR�*UDVS�����7KH�DQLPDOV�WKDW�WRRN�WR�WKH�WUHHV��WKHUHE\�SUHVHUYLQJ�WKH�PRELOLW\�RI�WKH�IRUH�OLPEV��ZHUH�DEOH��LQ�FOLPELQJ��WR�SODFH�WKH�SDOP�RI�WKH�KDQG��EHFDXVH�RI�WKH�SRZHU�RI�URWDWLRQ��DJDLQVW�WKH�QHZ�KROG�DW�D�YDULHW\�RI�DQJOHV���,Q�FOLPELQJ��WKH�ILQJHUV�ZHUH�DOVR�IOH[HG��LQ�RUGHU�JR�PDNH�JUDVSLQJ�PRUH�SHUIHFW���7KH�SRZHU�WR�JUDVS�ZDV�ILUVW�XVHG�LQ�JUDVSLQJ�WKH�OLPEV�DQG�EUDQFKHV�RI�WKH�WUHHV�LQ�ZKLFK�WKH�FUHDWXUH�FOLPEHG��EXW��RQFH�DWWDLQHG��LW�ZDV�DOVR�WR�JUDVS�OHDYHV�DQG�IUXLWV��IRU�FDUU\LQJ�IRRG�WR�WKH�PRXWK��IRU�VFUDWFKLQJ�WKH�ERG\��HWF�����7KHVH�DFWLYLWLHV�JDYH�ULVH�WR�WKH�³IHHO�´�RI�WKH�ERG\�DQG�WKH�VKDSH�DQG�IRUP�RI�WKH�ERG\���7KH�KDQG��WKHQ��LV�DQ�H[WUDRUGLQDU\�VXUYLYDO�RI�D�YHU\�SULPLWLYH�IHDWXUH�ZKLFK�JRHV�IDU�EDFN�LQWR�WKH�PDPPDOLDQ�VHULHV���,W�LV�WKH�UHWHQWLRQ�RI�D�FRQGLWLRQ�VR�SULPLWLYH�WKDW�LW�LV�PDWFKHG�RQO\�DPRQJ�LWV�LPPHGLDWH�VLQ�DQG�E\�W\SHV�VLWXDWHG�LQ�YHUWHEUDH�VWRFN�DW�WKH�SRLQW�RI�PDPPDOLDQ�GLYHUJHQFH���7KH�KDQG�RI�PDQ�LV�PRUH�LV�PRUH�OLNH�WKH�KDQG�RI�$UPDQGD�DQG�7RUWRLVH�WKDQ�OLNH�WKDW�RI�D�GRJ��SLJ��RU�KRUVH��WKHVH�EHLQJ�LQ�WKLV�SDUWLFXODU�UHVSHFW��PRUH�KLJKO\�VSHFLDOL]HG�����7KH�'HYHORSPHQW�RI�+LQG�/LPEV�����7KH�ERG\�RI�D�SURQRJUDGH�LV�DW�WKH�ULJKW�DQJOHV�WR�WKH�ORZHU�OLPEV��ZKLOH�WKH�ERG\�RI�DQ�RUWKRJUDGH�LV�LQ�D�VWUDLJKW�OLQH�ZLWK�WKH�ORZHU�OLPEV���1RZ��WKH�H[WHQVLRQV�RI�WKH�OHJ�XSRQ�WKH�WUXQN�DQG�WKH�DQDWRPLFDO�DGDSWDWLRQV�LW�LQYROYHG�ZHUH�WKH�RXWFRPH�RI�WKH�DUERUHDO�KDELW���,Q�7KHUDSVLGDH��WKH�KLQG�±OLPEV�ZHUH�PRELOH�DQG�PRUH�RU�OHVV�DW�ULJKW�DQJOHV�ZLWK�WKH�D[LV�RI�WKH�WUXQN���:LWK�WKH�FRPLQJ�RI�WKH�FOLPELQJ�KDELWV��WKH�UHODWLRQV�EHWZHHQ�WKHVH�SDUWV�RI�WKH�ERG\�ZHUH�FKDQJHG�DQG�WKH�OHJV�ZHUH�H[WHQGHG�XSRQ�WKH�WUXQN�LQ�D�PRUH�RU�OHVV�VWUDLJKW�OLQH���7KH�DQLPDO�WKXV�EHFDPH�RUWKRJUDGH�LQVWHDG�RI�SURQRJUDGH�LQ�SRVWXUH���,Q�UHDFKLQJ�RXW�IRU�D�QHZ�JUDVS�ZKLOH�LQ�WKLV�SRVLWLRQ��WKH�ZHLJKW�RI�WKH�ERG\�ZDV�WKURZQ�XSRQ�WKH�KLQG�OLPEV���8QGHU�WKHVH�FRQGLWLRQV��DQFHVWUDO�PRELOLW\�RI�WKH�KLQG�OLPEV�ZDV�D�JUHDW�KDQGLFDS�LQ�WKH�ZD\�RI�DIIHFWLQJ�WKH�VWDELOLW\�UHTXLUHG�IRU�WKH�KLQG�OLPEV���$V�WLPH�SDVVHG�WKHVH�GLVDGYDQWDJHV�ZHUH�RYHUFRPH�WKRXJKW�PRUSKRORJLFDO�FKDQJHV�LQ�WKH�MRLQWV�ZKLFK�OLPLWHG�PRELOLW\�DQG�DXJPHQWHG�VWDELOLW\���:KLOH�WKHVH�GHYHORSPHQWV�KDG�WKHLU�RULJLQ�LQ�WKH�DGDSWDWLRQV�WR�SXUHO\�DUERUHDO�KDELWV��WKHLU�FRPSOHWHQHVV�GLG�QRW�WDNH�SODFH�XQWLO�WKH�WHUUHVWULDO�SURJUHVVLRQ�KDG�EHHQ�DVVXPHG���$V�D�PDWWHU�RI�IDFW��VWDELOLW\�LV�VWLOO�LQ�SURJUHVV���7KLV�FDQ�EH�SURYHQ�E\�D�VWXG\�RI�WKH�PRUSKRORJLFDO�GHYHORSPHQW�RI�WKH�H[WUHPLWLHV�RI�WKH�KLQG�OLPEV��WKH�IHHW�DQG�WRHV���7KH�IHHW�LQ�WKH�HDUO\�DUERUHDO�VWDJHV��ZHUH�LQ�DOO�SUREDELOLW\�EXLOW�RQ�WKH�VDPH�SDWWHUQ�DV�WKH�KDQG��KDYLQJ�WKH�VDPH�GLJLW�IRUPXOD«QDPHO\������������������7KH�DELOLW\�RI�WKH�IRRW�WR�JUDVS�HYHQ�DIWHU�LW�KDG�EHFRPH�D�VXSSRUWLQJ�RUJDQ�ZDV�VWLOO�YHU\�SURQRXQFHG���7KH�VROH�ZDV�WXUQHG�XSZDUG��JLYLQJ�WKH�IRRW�DQ�LQYHUWHG�DSSHDUDQFH���7KH�ELJ�WRH�UHWDLQHG�LWV�

���

RSSRVLWH�FKDUDFWHU���7KHVH�DUUDQJHPHQWV�PDGH�FOLPELQJ�DQG�SURJUHVVLRQ�KDELW��ERWK�RI�WKHVH�FKDUDFWHULVWLFV�JUDGXDOO\�GLVDSSHDUHG��WKH�LQYHUWHG�SRVLWLRQ�RI�WKH�IRRW�DQG�WKH�RSSRVLWH�FKDUDFWHU�RI�WKH�ELJ�WRH�QR�ORQJHU�KDYLQJ�DQ\�YDOXH�����5HFHVVLRQ�RI�6QRXW�5HJLRQV�����0RVW�SURQRJUDGH�DQLPDOV�KDYH�ORQJ�VQRXWV�DG�IDFHV��ZKLOH�PRVW�RUWKRJUDGH�DQLPDOV�KDYH�UHODWLYHO\�VKRUW�MDZV�DQG�IDFHV���7KHVH�ODVW�IHDWXUHV�DUH�LQ�JHQHUDO�PRVW�SURQRXQFHG�LQ�WKH�KLJKHU�SULPDWHV�DQG�UHDFK�WKH�KHLJKW�RI�WKHLU�GHYHORSPHQW�LQ�WKH�KXPDQ�EHLQJ���%HFDXVH�RI�WKH�XVH�RI�WKH�IRUH�OLPEV�IRU�FRQYH\LQJ�IRRG�WR�WKH�PRXWK��E\�WKH�RUWKRJUDGH�DQLPDOV��LQVWHDG�RI�WKH�XVH�RI�WKH�PRXWK�IRU�JUDVSLQJ�IRRG�DV�LV�GRQH�E\�WKH�SURQRJUDGH�DQLPDOV��WKH�VL]H�RI�WKH�MDZV�DQG�WKH�VL]H�DQG�QXPEHU�RI�WKH�WHHWK�RI�WKH�ODWWHU�ZHUH�JUHDWO\�UHGXFHG�LQ�WKH�IRUPHU���7KH�QHDUHU�WRZDUGV�PDQ�ZH�FRPH��WKH�VPDOOHU�DUH�WKH�WHHWK�LQ�VL]H�DQG�QXPEHU���7KHUHIRUH��LQ�W\SLFDO�PDPPDOV�WKHUH�DUH�IRUW\�IRXU�WHHWK��FRPSULVLQJ�WKH�XSSHU�DQG�ORZHU�VHWV�RI�WKUHH�LQFLVRUV��2QH�FDQLQH��IRXU�SUHPRODUV��DQG�WKUHH�PRODUV��ZKLOH�LQ�DSHV�DQG�KXPDQ�EHLQJV�WKHUH�DUH��LQFOXGLQJ�WKH�XSSHU�DQG�ORZHU�VHWV��WZR�LQFLVRUV��RQH�FDQLQH��WZR�SUHPRODUV��DQG�WZR�PRODUV�RU�D�WRWDO�RI�WKLUW\�WZR���7KH�MDZV�DQG�PRXWK�EHFDPH�VPDOOHU��QDWXUDOO\�ZLWK�WKH�DWURSK\�RI�WKH�WHHWK���7KHVH�JHQHUDO�FKDQJHV�RI�WKH�PRXWK�EURXJKW�DERXW�FHUWDLQ�RWKHU�FKDQJHV�RI�FRQVLGHUDEOH�LPSRUWDQFH«WKH�FKDQJH�LQ�WKH�VL]H�RI�WKH�PRXWK�FDYLW\��DFFRPSDQLHG�E\�D�PRGLILFDWLRQ�RI�WKH�PXVFXODWXUH�RI�WKH�WRQJXH��WKURDW��DQG�QHFN�DIIHFWLQJ�WR�VRPH�GHJUHH�WKH�DUWLFXODWLRQ�LQ�VSHHFK��WKH�FKDQJHV�LQ�WKH�JHQHUDO�ORFDWLRQ�RI�WKH�H\HV��EULQJLQJ�WKHP�IURP�D�SRVLWLRQ�RQ�WKH�VLGHV�RI�WKH�IDFH�WR�D�SRVLWLRQ�LQ�IURQW�RI�WKH�IDFH�DQG�LQ�PRUH�RU�OHVV�WKH�VDPH�SODQH�DQG�EDODQFH�����7KH�3HUIHFWLRQ�RI�WKH�8SULJKW�3RVWXUH�����$QRWKHU�FKDQJH�EURXJKW�DERXW�E\�WKH�JHQHUDO�FKDQJHV�RI�WKH�VQRXW�UHJLRQV�DQG�ZKLFK�KDV�FDXVHG�RQH�RI�WKH�PRVW�VWULNLQJ�GLIIHUHQFHV�EHWZHHQ�WKH�SURQRJUDGHV�DQG�WKH�RUWKRJUDGHV�LV�WKH�FKDQJH�LQ�WKH�SRVLWLRQ�RI�WKH�KHDG�RQ�WKH�VSLQH���7KLV�FKDQJH�PDGH�SRVVLEOH�WKH�SHUIHFWLRQ�RI�WKH�XSULJKW�SRVWXUH�E\�KRPR�VDSLHQV�DQG�LV�RQH�RI�WKH�PRVW�PDJQLILFHQW�FKDQJHV�EURXJKW�DERXW�E\�WKH�UHFHVVLRQ�RI�WKH�VQRXW�UHJLRQV�����7KH�/RVV�RI�7DLO������7KH�WDLO�EHLQJ�D�SURORQJDWLRQ�RI�WKH�WDLO�ERQH��IROGV�EDFN�XSRQ�WKH�EDFN�RI�WKH�KXPDQ�HPEU\R��7KLV�LV�D�SURFHVV�RI�UHFDSLWXODWLRQ��7KH�ORVV�RI�WKH�WDLO�LV�GXH�WR�WKH�XSULJKW�SRVWXUH�RI�WKH�SULPDWHV������7KH�/RVV�RI�%RG\�+DLU������%\�WKH�WLPH�$XVWUDORSLWKHFXV�HPHUJHG��WKH�ERG\�KDLU�FKDUDFWHULVWLF�RI�WKH�SRQJLG�DQFHVWRUV�KDG�GLPLQLVKHG�FRQVLGHUDEO\���,Q�WKH�VDYDQQDK�DQG�ZRRGODQGV��WKHVH�KRPLQLGV�ZHUH�DOPRVW�FRQVWDQWO\�H[SRVHG�WR�WKH�KHDW�RQ�WKH�VXQ���,W��WKHUHIRUH��EHFDPH�QHFHVVDU\�IRU�WKHLU�ERGLHV�WR�GHYHORS�D�PRUH�HIILFLHQW�KHDW�ORVV�V\VWHP���7KLV�ZDV�DFKLHYHG�E\�WKH�JUDGXDO�ORVV�RI�WKH�ERG\�KDLU�DQG�WKH�PXOWLSOLFDWLRQ�RI�ERGLO\�VHDW�JODQGV���7KLV�ORVV�RI�

���

ERG\�KDLU��KRZHYHU��SRVHG�DQ�DGGLWLRQDO�SUREOHP��KRZ�WR�SURWHFW�WKH�XQGHUO\LQJ�VNLQ�IURP�WKH�GLUHFW�UD\V�RI�WKH�VXQ�VLQFH�WKH�KDLU\�FRYHULQJ�ZDV�GLVDSSHDULQJ���7KH�UHVSRQVH�ZDV�WR�GHYHORS�D�PHODQLQ�V\QWKHVLV�FDSDELOLW\�LQ�WKH�VNLQ���6HH�$SSHQGL[���������7KH�(YROXWLRQ�RI�WKH�+XPDQ�%UDLQ������)URP�$XVWUDORSLWKHFXV�5REXVWXV�WKURXJK�+RPR�6DSLHQV�6DSLHQV�WKH�KXPDQ�EUDLQ�JUHZ�LQ�VL]H��KRZHYHU��WKH�PRVW�LPSRUWDQW�DVSHFW�ZDV�WKH�GHYHORSPHQW�RI�LWV�GHQVHQHVV�RI�FRQVFLRXVQHVV���:KLOH�EHFRPLQJ�GHQVH�WKH�KXPDQ�EUDLQ¶V�LQGHQWDWLRQV�JRW�GHHSHU���7KH�PRUH�WKH�FRQVFLRXV�WKRXJKW��WKH�GHHSHU�WKH�LQGHQWDWLRQV�EHFDPH���7KH�PRUH�WKH�LQGHQWDWLRQV�EHFDPH��WKH�PRUH�WKHLU�WKRXJKW�EHFDPH�FRQVFLRXV�DQG�WKLV�LQWHUGHSHQGHQW�F\FOH�FRQWLQXHV�WR�WKLV�YHU\�GD\���7KH�&KURQRORJ\�RI�+XPDQLW\¶V�/LIH�+LVWRU\������7KH�EDVLF�PRGHO�XSRQ�ZKLFK�KXPDQLW\�LV�SDWWHUQHG�FOHDUO\�RQ�WKH�$IULFDQ�PRGHO���7KH�DEXQGDQFH�RI�DUFKHRORJLFDO�UHFRUGV�UHSRUW�WKDW�QR�VNHOHWDO�UHPDLQV�ROGHU�WKDQ���������\HDUV�FDQ�EH�IRXQG�RXWVLGH�RI�$IULFD��EXW�PXOWLSOH�UHFRUGV�RI�KXPDQRLG�UHPDLQV�LQ�$IULFD�GDWH�EDFN�RYHU�IRXU�����PLOOLRQ�\HDUV������7KH�ROGHVW�UHSRUWHG�KXPDQ�VNHOHWDO�ILQGLQJ�RXWVLGH�RI�$IULFD�ZDV�LQ�-DYD��WKH�VR�FDOOHG��³-DYD�0DQ�´��+H�ZDV�D���������\HDU�VNHOHWRQ�RI�WKH�KXPDQ�FDOOHG��³+RPR�(UHFWXV�´��+RZHYHU��KXPDQ�IRRW�SULQWV�KDYH�EHHQ�IRXQG�LQ�(WKLRSLD�SUHVHUYHG�LQ�YROFDQLF�DVK�IORRUV�GDWLQJ�EHFN������PLOOLRQ�\HDUV���7R�WUXO\�XQGHUVWDQG�WKH�SKHQRPHQRQ�RI�HYROXWLRQ��OHW�XV�WDNH�D�FKURQRORJLFDO�ORRN�DW�WKH�/LIH�+LVWRU\�RI�WKH�+XPDQ�)DPLO\�7KH�FHQWUDO�SRVWXODWH�RI�+XPDQLW\¶V�/LIH�+LVWRU\�LV�WKDW�DOO�VSHFLHV��OLYLQJ�DQG�H[WLQFW��DUH�UHODWHG�WKURXJK�GHVFHQW��WR�D�FRPPRQ�DQFHVWRU���,Q�D�EUDQFKLQJ�SDWWHUQ�RI�GHVFHQW��UHODWLRQVKLSV�EHWZHHQ�DQ\�SDLU�RI�VSHFLHV�PD\�EH�RQH�RI�WZR�NLQGV����2QH�VSHFLHV�LV�WKH�DQFHVWRU�RI�WKH�RWKHU����%RWK�DUH�GHVFHQGHG��DW�VRPH�SRLQW��IURP�D�FRPPRQ�DQFHVWRU������&ORVHO\�UHODWHG�VSHFLHV��WKRVH�ZLWK�D�UHFHQW�FRPPRQ�DQFHVWU\��WHQG�WR�ORRN�PRUH�DOLNH�WKDQ�WKRVH�PRUH�UHPRWHO\�UHODWHG�VLQFH�XVXDOO\�WKH\�ZLOO�KDYH�LQKHULWHG�D�ODUJHU�SURSRUWLRQ�RI�FKDUDFWHULVWLFV�RI�WKHLU�FRPPRQ�DQFHVWRU������/LIH¶V�+LVWRU\�UHYHDOV�LWVHOI�LQ�D�FDOO�DQG�UHVSRQVH�SDWWHUQ���1DWXUH�VLJQDOV�WR�OLYLQJ�VSHFLHV�WKURXJK�KHU�KLV�FRQWLQXDO�FKDQJHV��DQG�WKH�VSHFLHV��LI�WKH\�DUH�WR�VXUYLYH��LQLWLDWH�DGDSWLYH�FKDQJHV�ERWK�DW�WKH�PLFUR�DQG�PDFUR�OHYHO��PHGLDWHG�WKURXJK�WKH�DJHQWV�RI�KHUHGLW\��WKH�JHQHV������+XPDQV�EHORQJ�WR�WKH�RUGHU��³3ULPDWHV�´��7KH�ODUJHU�JURXS�FRQWDLQV�WKH�OLYLQJ�OHPXUV�DQG�WKHLU�DOOLHV��WKH�ORZHU�SULPDWHV��DV�ZHOO�DV��WKH�PRQNH\V��DSHV�DQG�XV��KLJKHU�3ULPDWHV����7KH�HDUOLHVW�NQRZQ�SULPDWHV�OLYHG�DORQJVLGH�WKH�ODVW�GLQRVDXU��RYHU����PLOOLRQ�\HDUV�DJR������7KHUH�DUH�FXUUHQWO\�ILYH�����VSHFLHV�RI�DSHV�EHORQJLQJ�WR�WKH�3RQJLGDH�IDPLO\���7KUHH�RI�WKHVH�VSHFLHV��WKH�JRULOOD��FKLPSDQ]HH�DQG�RUDQJXWDQ�DUH�FODVVLILHG�DV�WKH�JUHDW�DSHV���7ZR�RI�WKH�JUHDW�DSHV��WKH�JRULOOD�DQG�WKH�FKLPSDQ]HH�DUH�IRXQG�RQO\�LQ�$IULFD�DQG�WKHVH�DUH�WKH�WZR�WKDW�DUH�FORVHVW�WR�KXPDQV�

���

�����:H�NQRZ�WKDW�WKH�SULPDWH�DQFHVWRUV�RI�WKH�SRQJLGLGDH�DQG�KRPLQLGDH�KDG�OLYHG�DOPRVW�H[FOXVLYHO\�LQ�WUHHV��VXEVLVWLQJ�RQ�D�GLHW�RI�IUXLW�DQG�OHDYHV���%XW��E\����PLOOLRQ�\HDUV�DJR��WKH�JUHDW�DSHV�KDG�QHDUO\�FRPSOHWHG�D�WUHQG��EHJXQ�E\�WKHLU�DQFHVWRUV�RI�VSHQGLQJ�LQFUHDVLQJO\�PRUH�WLPH�RQ�WKH�JURXQG���7KH\�OLYHG�QHDU�WUHHV�WR�MXPS�XS�WR�DYRLG�SUHGDWRUV�HYHQWXDOO\�WKH\�EHFDPH�WRWDOO\�JURXQG�GZHOOHUV���+XPDQLW\¶V�DQFHVWRU�HPHUJHG����PLOOLRQ�\HDUV�DJR�DV�D�JURXQG�GZHOOHU���6RRQ�KH�VKH�ZHQW�WR�RSHQ�VDYDQQDK���%XW��VRPHWKLQJ�HOVH�KDSSHQHG�WR�WKHVH�HDUO\�KRPLQLGV�VZHOOLQJ�LQ�D�KRW��VSDUVHO\�IRUHVWHG�HQYLURQPHQW������$SHV�DQG�KXPDQV��WRJHWKHU�FDOOHG�KRPLQLGV��VKDUH�WKH�VDPH�EDVLF�VWUXFWXUH��EXW��FRPSDUHG�WR�DSHV��KXPDQV�DUH�VSHFLDOL]HG�LQ�D�QXPEHU�RI�IHDWXUHV����/DUJH�DQG�LQWHUQDOO\�UHRUJDQL]HG�EUDLQ���%L�SHGDO�ZDONLQJ�PRGLILHG�ERG\�VNHOHWRQ���5HGXFHG�IDFH�DQG�FDQLQH�WHHWK���0DQXDO�GH[WHULW\�OHDGLQJ�WR�XVH�DQG�PDQXIDFWXUH�RI�VRSKLVWLFDWHG�WRROV��7KH�DFTXLULQJ�RI�WKH�JURXQG�GZHOOLQJ�KDELWDW�QHFHVVLWDWHG�WKH�WUDQVIRUPDWLRQ�RI�WKH�IRRW�IURP�D�SUHKHQVLOH��VHL]LQJ��JUDVSLQJ��WR�D�VXSSRUWLQJ�RUJDQ���5HODWLYHO\�OLWWOH�FKDQJH�WRRN�SODFH�LQ�WKH�DUPV�DQG�KDQGV���7KH�FRPSOHWH�IUHHGRP�RI�WKH�KDQG�EURXJKW�DERXW�WKH�IXUWKHU�RSSRVDELOLW\���2SSRVLWH��RI�WKH�WKXPE��ZKLFK�EHFDPH�ORQJ�DQG�RSSRVHG�WR�WKH�RWKHU�GLJLWV��ILQJHUV���DQG�LQFUHDVLQJO\�XVHIXO�RQ�WKDW�DFFRXQW���7KH�IUHHGRP�RI�WKH�KDQG�OHG�WR�WRRO�SURGXFLQJ�DQG�WR�WRRO�XVLQJ�KDELWV��DQG�RSHQHG�WKH�GRRU�WR�WKH�FUHDWLRQ�RI�FXOWXUDO�KLVWRU\�,QLWLDOO\��RXU�DQFHVWRUV�ZRXOG�KDYH�EHHQ�FODVVLILHG�DV�DQRWKHU�VSHFLHV�RI�DSH��EXW��D�VHTXHQFH�RI�WKUHH�����FKDQJHV�ODXQFKHG�WKDQ�LQ�WKH�GLUHFWLRQ�RI�PRGHUQ�KXPDQV����VW�FKDQJH�±�2FFXUUHG�E\�DURXQG�IRXU�����PLOOLRQ�\HDUV�DJR���7KH�VWUXFWXUH�RI�IRVVLOL]HG�OLPE�ERQHV�VKRZ�WKDW�E\�WKHQ�RXU�DQFHVWRUV��LQ�FRQWUDVW�WR�WKH�JRULOOD�DQG�FKLPSV��ZHUH�KDELWXDOO\�ZDONLQJ�XSULJKW���7KH�XSULJKW�SRVWXUH�IUHHG�RXU�IRUH�OLPEV�WR�GR�RWKHU�WKLQJV��DPRQJ�ZKLFK�WRRO�PDNLQJ�ZRXOG�HYHQWXDOO\�SURYH�WR�EH�WKH�PRVW�LPSRUWDQW���QG�FKDQJH�±�2FFXUUHG�DURXQG�WKUHH�����PLOOLRQ�\HDUV�DJR��ZKHQ�RXU�OLQHDJH�VSOLW�LQ�WZR���7KHUH�ZHUH�WZR�����VSHFLHV�RI�KXPDQV��$XVWUDORSLWKHFXV�5REXVWXV�DQG�$XVWUDORSLWKHFXV�*UDFLOH���$XVWUDORSLWKHFXV�*UDFLOH�WUDQVPXWHG�LQWR�WKH�GHQVHU�EUDLQHG�+RPR�+DELOLV��+XPDQ�RI�$ELOLW\����UG�FKDQJH�±�2FFXUUHG�DURXQG�WZR�DQG�KDOI�������PLOOLRQ�\HDUV�DJR���9HU\�FUXGH�VWRQH�WRROV�DSSHDU�LQ�ODUJH�QXPEHUV�LQ�DUHDV�RI�(DVW�$IULFD�+XPDQNLQG�ZDV�LQLWLDWHG�E\�WKH�$XVWUDORSLWKHFXV�ZKR�KDG�D�PDVVLYH�VNHOHWDO�VWUXFWXUH�DQG�D�FUDQLXP�UHVHPEOLQJ�DQ�DUURZKHDG��,W�KDV�EHHQ�LQ�H[LVWHQFH�IRU�����PLOOLRQ�\HDUV���7KLV�LV�WKH�DJH�DWWULEXWHG�WR�³/XF\�$UGL´�LQ�(WKLRSLD���7ZR�DQG�D�KDOI�������PLOOLRQ�\HDUV�DJR��WKUHH�����KRPLQLGV�ZHUH�LQ�H[LVWHQFH��7KH\�ZHUH�$XVWUDORSLWKHFXV�5REXVWXV��$XVWUDORSLWKHFXV�*UDFLOH��ZKR�KDG�D�GHQVHU�FUDQLXP�WKDQ�WKH�IRUPHU�DQG�D�PRUH�GHYHORSHG�ERQH�VWUXFWXUH���DQG�+RPR�+DELOLV��GHFLGHGO\�PRUH�DGYDQFHG�WKDQ�WKH�IRUPHU�WZR��ZLWK�D�GHQVHU�FUDQLXP���7KHVH�WKUHH�����VSHFLPHQV�WKDW�UHSUHVHQWHG�WKH�YHU\�EHJLQQLQJ�RI�KXPDQNLQG�FDQQRW�EH�IRXQG�LQ�(XURSH��$VLD��$PHULFD�RU�DQ\SODFH�HOVH�LQ�WKH�ZRUOG��EHFDXVH�WKH\�QHYHU�OHIW�$IULFD���7KHVH�WKUHH�����KRPLQLGV�ZHUH�IROORZHG�

���

E\�+RPR�(UHFWXV��+RPR�6DSLHQV�DQG�+RPR�6DSLHQV�6DSLHQV���7KHUH�LV�DQ�DQDWRPLFDO�GLIIHUHQFH�EHWZHHQ�+RPR�6DSLHQV�DQG�+RPR�6DSLHQV�6DSLHQV���+RPR�6DSLHQV��WKH�ILIWK���WK��VSHFLHV��GLG�QRW�KDYH�D�IURQWDO�OREH�LQ�KLV�KHU�EUDLQ��ZKLFK�LV�WKH�VHDW�RI�FUHDWLYH�LQWHOOLJHQFH���%X�WKH�WLPH�WKH�VL[WK���WK��VSHFLHV��+RPR�6DSLHQV�6DSLHQV�WUDQVPXWHG��KLV�KHU�EUDLQ�H[SDQGHG�DQG�KRXVHG�WKH��OREH�WKDW�ZRXOG�HQDEOH�KLP�KHU�WR�WUDQVFHQG�QDWXUH�DQG�DFWLYDWH�WKHLU�SLQHDO�JODQG���7KLV�FUHDWLYH�LQWHOOLJHQFH�RU�+XVLD�DOORZHG�+RPR�6DSLHQV�6DSLHQV�WR�GHYHORS�FLYLOL]DWLRQV��LQFOXGLQJ�WKH�$UWV�DQG�6FLHQFHV�DQG�DOO�WKDW�LW�LPSOLHV��0DWK��6SLULWXDOLW\��$VWURQRP\��/DQJXDJH��3KLORVRSK\��HWF�����7KH�6L[�����3K\VLFDO�7UDQVPXWDWLRQV�RI�WKH�+XPDQ�)DPLO\$XVWUDORSLWKHFLQH�UHIHUV�WR�WKH�DQFLHQW�KRPLQLG�JHQXV�$XVWUDORSLWKHFXV�RU�WR�D�JUDGH�RI�HDUO\�KRPLQLGV�SUHFHGLQJ�WKH�JHQXV�+RPR���7KH�VR�FDOOHG�UREXVW�DXVWUDORSLWKHFLQHV�DUH�GLVWLQJXLVKHG�E\�KDYLQJ�ODUJHU�WHHWK�DQG�D�PRUH�KHDYLO\�EXLOW�MDZ�VWUXFWXUH�WKDQ�WKH�VSHFLHV�NQRZQ�DV�JUDFLOH�DXVWUDORSLWKHFLQHV�7KH�$XVWUDORSLWKHFLQH�/LQH�����:LWK�WKH�DSSHDUDQFH�RI�$XVWUDORSLWKHFXV�VRPH�IRXU�����RI�PRUH�PLOOLRQ�\HDUV�DJR��ZH�UHDFK�WKH�GDZQ�RI�KXPDQNLQG���7KHUH�DUH�FHUWDLQ�WKLQJV�ZH�FDQ�VD\�DERXW�WKH�$XVWUDORSLWKHFLQHV����7KH\�ZHUH�HIILFLHQW�EL�SHGDO�ZDONHUV����7KHLU�KDELWDW�ZDV�ODUJHO\�RSHQ�VDYDQQDK�DQG�ZRRGODQG����7KH\�OLYHG�LQ�KXQWLQJ�JDWKHULQJ�VRFLHWLHV�����,W�LV�DOVR�IHOW�WKDW�IURP�WKH�$XVWUDORSLWKHFLQHV�RQZDUG��KRPLQLGV�GHYHORSHG�SDWWHUQV�RI�IRRG�VKDULQJ�KDG�D�SURIRXQG�HIIHFW�RQ�KRPLQLG�KLVWRU\�VLQFH�LW�FUHDWHG�D�ZKROH�QRZ�FRRSHUDWLYH�DUHQD�RI�EHKDYLRU������$XVWUDORSLWKHFLQHV�ZHUH�SUREDEO\�KHUELYRURXV��WKH�EXON�RI�WKHLU�QXWULWLRQ�GHSHQGHG�RQ�JDWKHULQJ�YHJHWDEOHV�DQG�IUXLWV���7KHLU�HQYLURQPHQW�ZDV�ODUJHO\�RSHQ�VDYDQQDK������7KURXJK�WKH�FRPSDULVRQV�RI�$XVWUDORSLWKHFLQH�VNXOOV�GHPRQVWUDWHG�EH\RQG�DOO�DUJXPHQW�WKDW�ZKLOH�WKH\�KDG�VRPH�DSH�OLNH�IHDWXUHV��$XVWUDORSLWKHFLQHV�ZHUH�GHILQLWHO\�QRW�DQ�DSH��EXW�D�KRPLQLG�LQ�WKH�SURFHVV�RI�PRYLQJ�FORVHU�WR�KXPDQ�WKDW�DSH��7KH�+RPR�/LQH+RPR�+DELOLV�����7KH�HDUOLHU�RI�WKH�WZR�H[WLQFW�VSHFLHV�RI�RXU�JHQXV�QRUPDOO\�UHFRJQL]HG�LV�+RPR�+DELOLV���,W�ILUVW�DSSHDUHG�LQ�WKH�IRVVLO�UHFRUG�DW�DERXW���PLOOLRQ�\HDUV�DQG�VHHPV�WR�KDYH�SHUVLVWHG�IRU�XQGHU�KDOI�D�PLOOLRQ�\HDUV���+RPR�+DELOLV�PHDQV��³+XPDQ�RI�$ELOLW\�´��7KHLU�UHPDLQV�FDQ�EH�IRXQG�LQ�.HQ\D��(WKLRSLD��8JDQGD�DQG�SDUWV�RI�6RXWKHUQ�$IULFD���7KH\�ZHUH�JLYHQ�WKLV�QDPH�EHFDXVH�WKH\�ZHUH�WKH�ILUVW�WRRO�PDNHU���0DNLQJ�DQG�XVLQJ�WRROV�LV�FOHDUO\�RQH�RI�WKH�GLDJQRVWLF�IHDWXUHV�RI�KXPDQLW\���+DELOLV�GLIIHUHG�OLWWOH�IURP�$XVWUDORSLWKHFXV�*UDFLOH�LQ�WKH�WHHWK��EXW��KDG�D�VLJQLILFDQWO\�H[SDQGHG�EUDLQ��D�OHVV�SURMHFWLQJ�IDFH�DQG�D�PRUH�PRGHUQ�ERG\�VNHOHWRQ���+RPR�+DELOLV�DFWLYHO\�KXQWHG�VPDOO�DQG�PHGLXP�VL]HG�DQLPDOV�DV�ZHOO�DV�FROOHFWLQJ�D�YDULHW\�RI�SODQW�IRRGV�DQG�EXWFKHULQJ�GHDG�RU�GLVDEOHG�ODUJHU�DQLPDOV���+RPR�+DELOLV��OLNH�WKRVH�RI�$XVWUDORSLWKHFXV��DUH�FRQILQHG�HQWLUHO\�WR�$IULFD���+RPR�+DELOLV�ZHUH�WKH�ILUVW�SURGXFHUV�RI�WKH�UXGLPHQWV�RI�KXPDQ�FXOWXUH��

���

��+RPR�(UHFWXV�����+RPR�(UHFWXV�DSSHDUHG�LQ�$IULFD�DERXW�����PLOOLRQ�\HDUV�DJR���+H�6KH�KDV�DOVR�EHHQ�IRXQG�LQ�(DVWHUQ�$VLD���+RPR�(UHFWXV�LV�SHUKDSV�WKH�PRVW�GLVWLQFWLYH�RI�DOO�IRVVLO�KXPDQ�VSHFLHV���5REXVW��EXW��HVVHQWLDOO\�PRGHUQ�LQ�LWV�ERG\�VNHOHWRQ��LW�SRVVHVVHG�D�ORQJ��ORZ�VNXOO��DQJOHG�VKDUSO\�DW�WKH�EDFN�DQG�FRQVWUXFWHG�RI�WKLFN�ERQH���7KH�EUDLQ�RI�(UHFWXV�ZDV�ODUJHU��EXW��LWV�WHHWK�ZHUH�VPDOO�WKDQ�+DELOLV���(UHFWXV�ZDV�DSSDUHQWO\�WKH�HDUOLHVW�IRUP�RI�KXPDQ�WR�QRW�RQO\�XVH�ILUH��GRFXPHQWHG�DV�HDUO\�DV�����PLOOLRQ�\HDUV�LQ�(DVW�$IULFD���EXW�DOVR�WR�OLYH�LQ�FDYHV�DV�ZHOO�DV�LQ�RSHQ�VLWHV���$�PRUH�FRPSOH[�VWRQH�WRRO�NLW�DSSHDUV�LQ�$IULFD�DW�DURXQG�WKH�VDPH�WLPH�DV�IRVVLOV�RI�LWV�SUREDEOH�PDNHU��+RPR�(UHFWXV���7KHVH�WRROV�DUH�ODUJHU�DQG�PRUH�FDUHIXOO\�VKDSHG�WKDQ�+RPR�+DELOLV�DQG�PDGH�IURP�D�JUHDWHU�YDULHW\�RI�VWRQ\�PDWHULDOV���0DQ\�WRROV�ZHUH�PDGH�IRU�EXWFKHULQJ��GLJJLQJ�DQG�VNLQ�FOHDQLQJ�WDVNV���6XFK�WRROV�KDYH�EHHQ�IRXQG�DFURVV�$IULFD��(XURSH��,QGLD��&KLQD�DQG�6RXWK�(DVW�$VLD������+RPR�HUHFWXV�ZDV�WKH�ILUVW�WR�VWDQG�IXOO\�HUHFW�FDOOHG��³%LSHGDOLVP�´��%LSHGDOLVP�LV�WKH�DELOLW\�WR�VWDQG�RU�ZDON�RQ�WZR�OHJV�UDWKHU�WKDQ�IRXU��4XDGUXSHGDOLVP����+XPDQV�H[KLELW�KDELWXDO�ELSHGDOLVP�WKDW�LV��WKH\�VWDQG�DQG�ZDON�RQ�WZR�OHJV�DOO�WKH�WLPH���+DELWXDO�ELSHGDOLVP�HYROYHG�LQGHSHQGHQWO\�LQ�VHYHUDO�OLQHDJHV�RI�YHUWHEUDWHV��LQFOXGLQJ�WKH�DQFHVWRUV�RI�FHUWDLQ�OL]DUGV�DQG�GLQRVDXUV�DQG�WKH�DQFHVWRUV�RI�WKH�ELUGV�DQG�KXPDQV������+RPR�HUHFWXV¶�KHLJKW�UDQJHG�IURP������WR���IHHW���+H�6KH�ZDV�DQ�DYLG��KLJKO\�VNLOOHG�WRRO�PDNHU�DQG�ZDV�OLNH�KLV�KHU�KRPLQLG�SUHGHFHVVRU��EODFN�LQ�FRPSOH[LRQ���+RPR�(UHFWXV�GHYHORSHG�WKH�PLJUDWRU\�KDELW��IRU�KLV�IRVVLOV�KDYH�EHHQ�IRXQG�LQ�(XURSH�DQG�$VLD���/HDGLQJ�VFKRODUV�UHMHFW�WKH�LGHD�WKDW�WKLV�HYROXWLRQ�VWRSSHG�DW�WKH�+RPR�(UHFWXV�VWDJH�DQG�WKDW�³6DSLHQL]DWLRQ�´�WRRN�SODFH�DW�WKH�OHYHO�RI�HDFK�FRQWLQHQW���,W�LV�EHOLHYHG�WKDW�WKH�ZRUN�RI�'U��/HDNH\�DQG�RWKHU�H[SHUWV�KDYH�UHVXOWHG�LQ�WKH�WULXPSK�RI�WKH�³0RQRJHQHWLF�´�WKHRU\�RI�KXPDQLW\�LQ�$IULFD��WKH\�ZHUH�E\�QHFHVVLW\�EODFN�EHIRUH�EHFRPLQJ�OLJKWHU�LQ�FRPSOH[LRQ�WKURXJK�HQYLURQPHQWDO�DGDSWDWLRQ�DW�WKH�HQG�RI�WKH�:XUP�JODFLDWLRQV�LQ�QRUWKHUQ�(XURSH������$IWHU�RQH�PLOOLRQ�\HDUV��+RPR�(UHFWXV�ZDV�WKH�VROH�KRPLQLG�LQ�SRVVHVVLRQ�RI�WKH�HDUWK��XQWLO�WKH�DSSHDUDQFH�RI�+RPR�6DSLHQV���������WKRXVDQG�\HDUV�DJR���+LV�+HU�LQWHOOHFWXDO�OHYHO�UHSUHVHQWHG�D�TXDQWXP�OHDS�RYHU�WKDW�RI�KLV�KHU�DQFHVWRUV�DQG�KH�VKH�ZDV��FRQVHTXHQWO\��D�PRUH�HIILFLHQW�H[SORLWHU�RI�KLV�KHU�FXOWXUH�UDWKHU�WKDQ�EHLQJ�D�SDVVLYH�SDUWLFLSDQW�LQ�LW���$OWKRXJK�+RPR�(UHFWXV�PLJUDWHG�RXW�RI�$IULFD�LQWR�RWKHU�SDUWV�RI�WKH�2OG�:RUOG��WKH�+RPR�(UHFWXV�SRSXODWLRQ�ZDV������WLPHV�DV�KLJK�LQ�$IULFD�DV�HOVHZKHUH��+RPR�6DSLHQV�+RPR�6DSLHQV�6DSLHQV�����7KH�WZR�RWKHU�+RPR�VSHFLHV�WKDW�HYROYHG�RXW�RI�+RPR�(UHFWXV�ZHUH�+RPR�6DSLHQV�DQG�+RPR�6DSLHQV�6DSLHQV���$OWKRXJK�+RPR�(UHFWXV�VKDUHG�WKH�VDPH�KDELWDW�ZLWK�+RPR�6DSLHQV�IRU�DERXW���������\HDUV��WKH\�GLHG�RXW�HQWLUHO\�EHWZHHQ�����������\HDUV�DJR���7KH�ELJ�GLIIHUHQFH�EHWZHHQ�+RPR�(UHFWXV�DQG�+RPR�6DSLHQV�RU�+RPR�6DSLHQV�DQG�+RPR�6DSLHQV�6DSLHQV��LV�OHVV�D�FDVH�RI�EUDLQ�ZHLJKW�WKDQ�WKH�DEVHQFH�RI�WKH�SUHIURQWDO�OREH�LQ�WKH�EUDLQ�RI�+RPR�6DSLHQV������+RPR�6DSLHQV�PHDQV��³7KLQNLQJ�+XPDQ�´��$OO�PRGHUQ�SRSXODWLRQV�EHORQJ�WR�WKH�VSHFLHV�+RPR�6DSLHQV�6DSLHQV���7KH�ROGHVW�+RPR�6DSLHQV�6DSLHQV�SRSXODWLRQ�LV�IRXQG�LQ�$IULFD��GDWLQJ�EDFN�WR�DW�OHDVW���������\HDUV�DJR�DQG�SHUKDSV�����������1R�+RPR�

���

6DSLHQV�6DSLHQV�IRVVLOV�RI�FRPSDUDEOH�DQWLTXLW\�FDQ�EH�IRXQG�RXWVLGH�RI�$IULFD���7KH�DFFXPXODWLRQ�RI�WKH�EHVW�LQIRUPDWLRQ�QRZ�PDNHV�LW�YHU\�FOHDU�WKDW�KXPDQNLQG�KDG�KLV�KHU�RULJLQ�LQ�$IULFD���7KLV�$IULFDQ�DOPRVW�XQLODWHUDOO\�SHRSOH�DQG�LQIOXHQFHG�WKH�ZRUOG�IURP���PLOOLRQ�\HDUV�DJR�WR�WKH�JODFLDO�WKDZ�RI�WKH�:XUP�JODFLDWLRQV�SHULRG�WKDW�HQGHG�DERXW��������\HDUV�EHIRUH�WKH�&KULVWLDQ�HUD��$33(1',;�$SSHQGL[����±�/RVV�RI�%RG\�+DLU�7DNHQ�IURP�6FLHQWLILF�$PHULFDQ��)HEUXDU\�������³7KH�1DNHG�7UXWK��:K\�+XPDQV�+DYH�1R�)XU��$QG�+RZ�(YROYLQJ�%DUH�6NLQ�/HG�WR�%LJ�%UDLQ�´�1LQD�*��-DEORQVNL��SJ��������.H\�&RQFHSWV�

� +XPDQV�DUH�WKH�RQO\�SULPDWH�VSHFLHV�WKDW�KDV�PRVWO\�QDNHG�VNLQ�� /RVV�RI�IXU�ZDV�DQ�DGDSWDWLRQ�WR�FKDQJLQJ�HQYLURQPHQWDO�FRQGLWLRQV�WKDW�IRUFHG�

RXU�DQFHVWRUV�WR�WUDYHO�ORQJHU�GLVWDQFHV�IRU�IRRG�DQG�ZDWHU�� $QDO\VHV�RI�IRVVLOV�DQG�JHQHV�KLQW�DW�ZKHQ�WKLV�WUDQVIRUPDWLRQ�RFFXUUHG�� 7KH�HYROXWLRQ�RI�KDLUOHVVQHVV�KHOSHG�WR�VHW�WKH�VWDJH�IRU�WKH�HPHUJHQFH�RI�ODUJH�

EUDLQV�DQG�V\PEROLF�WKRXJKW��

3J������«QDNHG�VNLQ�LWVHOI�SOD\HG�D�FUXFLDO�UROH�LQ�WKH�HYROXWLRQ�RI�RWKHU�FKDUDFWHULVWLF�KXPDQ�WUDLWV��LQFOXGLQJ�RXU�ODUJH�EUDLQ�DQG�GHSHQGHQFH�RQ�ODQJXDJH�

�3J������%HQHILWV�RI�+DLUOHVVQHVV1DNHG�KXPDQ�VNLQ�LV�EHWWHU�DW�ULGLQJ�WKH�ERG\�RI�H[FHVV�HDW�WKDQ�LV�IXU�FRYHUHG�VNLQ���0DPPDOV�SRVVHVV�WKUHH�W\SHV�RI�JODQGV�IRU�WKH�SXUSRVH���DSRFULQH��HFFULQH�DQG�VHEDFHRXV���,Q�PRVW�PDPPDOV�WKH�RXWHUPRVW�OD\HU�RI�WKH�VNLQ��NQRZQ�DV�WKH�HSLGHUPLV��FRQWDLQV�DQ�DEXQGDQFH�RI�DSRFULQH�JODQGV���7KHVH�JODQGV�FOXVWHU�DURXQG�KDLU�IROOLFOHV�DQG�FRDW�WKH�IXU�LQ�D�ODWKHU�RI�RLO\�VHDW���(YDSRUDWLRQ�RI�WKLV�VZHDW��ZKLFK�FRROV�WKH�DQLPDO�E\�GUDZLQJ�KHDW�DZD\�IURP�WKH�VNLQ��RFFXUV�DW�WKH�VXUIDFH�RI�WKH�IXU���%XW�WKH�PRUH�WKH�DQLPDO�SHUVSLUHV��WKH�OHVV�HIIHFWLYHO\�LW�HOLPLQDWHV�KHDW�EHFDXVH�WKH�IXU�EHFRPHV�PDWWHG��KDPSHULQJ�HYDSRUDWLRQ���,Q�WKH�KXPDQ�HSLGHUPLV��LQ�FRQWUDVW��HFFULQH�JODQGV�SUHGRPLQDWH���7KHVH�JODQGV�UHVLGH�FORVH�WR�WKH�VNLQ�VXUIDFH�DQG�GLVFKDUJH�WKLQ��ZDWHU\�VZHDW�WKURXJK�WLQ\�SRUHV���,Q�DGGLWLRQ�WR�HYDSRUDWLQJ�GLUHFWO\�IURP�WKH�VNLQ�VXUIDFH��WKLV�HFFULQH�VZHDW�YDSRUL]HG�PRUH�UHDGLO\�WKDQ�DSRFULQH�VZHDW��WKXV�SHUPLWWLQJ�LPSURYHG�FRROLQJ��3J����±�,Q�PDULQH�PDPPDOV�WKDW�QHYHU�YHQWXUH�DVKRUH��VXFK�DV�ZKDOHV��QDNHG�VNLQ�IDFLOLWDWHV�ORQJ�GLVWDQFH�VZLPPLQJ�DQG�GLYLQJ�E\�UHGXFLQJ�GUDJ�RQ�WKH�VNLQ¶V�VXUIDFH���7R�FRPSHQVDWH�IRU�WKH�ODFN�RI�H[WHUQDO�LQVXODWLRQ��WKHVH�DQLPDOV�KDYH�EOXEEHU�XQGHU�WKH�VNLQ���,Q�FRQWUDVW��VHPLTXDWLF�PDPPDOV�±�RWWHUV��IRU�H[DPSOH�±�KDYH�GHQVH��ZDWHUSURRI�IXU�WKDW�WUDSV�DLU�WR�SURYLGH�SRVLWLYH�EXR\DQF\��WKXV�GHFUHDVLQJ�WKH�HIIRUW�QHHGHG�WR�IORDW���7KLV�IXU�DOVR�SURWHFWV�WKHLU�VNLQ�RQ�ODQG�

���

�����3J����±�WKH�ODUJHVW�WHUUHVWULDO�PDPPDOV�QDPHO\��HOHSKDQWV��UKLQRFHURVHV�DQG�KLSSRSRWDPXVHV�DOVR�HYROYHG�QDNHG�VNLQ�EHFDXVH�WKH\�DUH�DW�FRQVWDQW�ULVN�RI�RYHUKHDWLQJ���7KH�ODUJHU�DQ�DQLPDO�LV�WKH�OHVV�VXUIDFH�DUHD�LW�KDV�UHODWLYH�WR�RYHUDOO�ERG\�PDVV�DQG�WKH�KDUGHU�LW�LV�IRU�WKH�FUHDWXUH�WR�ULG�LWV�ERG\�RI�H[FHVV�KHDW«'XULQJ�WKH�3OHLVWRFHQH�HSRFK��ZKLFK�VSDQV�WKH�WLPH�EHWZHHQ�WZR�PLOOLRQ�DQG��������\HDUV�DJR��WKH�PDPPRWKV�DQG�RWKHU�UHODWLYHV�RI�PRGHUQ�HOHSKDQWV�DQG�UKLQRFHURVHV�ZHUH�³ZRRO\´�EHFDXVH�WKH\�OLYHG�LQ�FROG�HQYLURQPHQWV��DQG�H[WHUQDO�LQVXODWLRQ�KHOSHG�WKHP�FRQVHUYH�ERG\�KHDW�DQG�ORZHU�WKHLU�IRRG�LQWDNH��3J����±�+XPDQ�KDLUOHVVQHVV�LV�QRW�DQ�HYROXWLRQDU\�DGDSWDWLRQ�WR�OLYLQJ�XQGHUJURXQG�RU�LQ�WKH�ZDWHU�WKH�SRSXODU�HPEUDFH�R�I�WKH�VR�FDOOHG�DTXDWLF�DSH�K\SRWKHVLV�QRWZLWKVWDQGLQJ���1HLWKHU�LV�LW�WKH�UHVXOW�RI�ODUJH�ERG\�VL]H���%XW�RXU�EDUH�VNLQ�LV�UHODWHG�WR�VWD\LQJ�FRRO��DV�RXU�VXSHULRU�VZHDWLQJ�DELOLWLHV�VXJJHVW��3J����±�6ZHDWLQJ�,W�2XW.HHSLQJ�FRRO�LV�D�ELJ�SUREOHP�IRU�PDQ\�PDPPDOV��QRW�MXVW�WKH�JLDQW�RQHV��HVSHFLDOO\�ZKHQ�WKH\�OLH�LQ�KRW�SODFHV�DQG�JHQHUDWH�DEXQGDQW�KHDW�IURP�SURORQJHG�ZDONLQJ�RU�UXQQLQJ���7KHVH�DQLPDOV�PXVW�FDUHIXOO\�UHJXODWH�WKHLU�FRUH�ERG\�WHPSHUDWXUH�EHFDXVH�WKHLU�WLVVXHV�DQG�RUJDQV��VSHFLILFDOO\�WKH�EUDLQ��FDQ�EHFRPH�GDPDJHG�E\�RYHUKHDWLQJ«6ZHDWLQJ�FRROV�WKH�ERG\�WKURXJK�WKH�SURGXFWLRQ�RI�OLTXLG�RQ�WKH�VNLQ¶V�VXUIDFH�WKDW�WKHQ�HYDSRUDWHV��GUDZLQJ�KHDW�HQHUJ\�DZD\�IURP�WKH�VNLQ�LQ�WKH�SURFHVV���7KLV�ZKROH�ERG\�FRROLQJ�PHFKDQLVP�RSHUDWHV�DFFRUGLQJ�WR�WKH�VDPH�SULQFLSOH�DV�DQ�HYDSRUDWLYH�FRROHU��DOVR�NQRZQ�DV�D�VZDPS�FRROHU���DQG�LW�LV�KLJKO\�HIIHFWLYH�LQ�SUHYHQWLQJ�WKH�GDQJHURXV�RYHUKHDWLQJ�RI�WKH�EUDLQ��DV�ZHOO�DV�RI�RWKHU�ERG\�SDUWV����3J������0DPPDOLDQ�VNLQ�FRQWDLQV�WKUHH�W\SHV�RI�JODQGV�VHEDFHRXV��DSRFULQH��DQG�HFFULQH�WKDW�WRJHWKHU�SURGXFH�VZHDW���,Q�PRVW�VSHFLHV��VHEDFHRXV�DQG�DSRFULQH�JODQGV�DUH�WKH�GRPLQDQW�VZHDW�JODQGV�DQG�DUH�ORFDWHG�QHDU�WKH�EDVH�RI�KDLU�IROOLFOHV���7KHLU�VHFUHWLRQV�FRPELQH�WR�FRDW�KDLUV�ZLWK�DQ�RLO\��VRPHWLPHV�IRDP\��PL[WXUH��WKLQN�RI�WKH�ODWKHU�D�UDFHKRUVH�JHQHUDWHV�ZKHQ�LW�UXQV����7KLV�W\SH�RI�VHDW�KHOSV�WR�FRRO�WKH�DQLPDO���%XW�LWV�DELOLW\�WR�GLVVLSDWH�KHDU�LV�OLPLWHG��3J����±�+XPDQV��LQ�DGGLWLRQ�WR�ODFNLQJ�IXU��SRVVHVV�DQ�H[WUDRUGLQDU\�QXPEHU�RI�HFFULQH�JODQGV�EHWZHHQ�WZR�PLOOLRQ�DQG�ILYH�PLOOLRQ�WKDW�FDQ�SURGXFH�XS�WR����OLWHUV�RI�WKLQ��ZDWHU\�VZHDW�D�GD\���(FFULQH�JODQGV�GR�QRW�FOXVWHU�QHDU�KDLU�IROOLFOHV��LQVWHDG�WKH\�UHVLGH�UHODWLYHO\�FORVH�WR�WKH�VXUIDFH�RI�WKH�VNLQ�DQG�GLVFKDUJH�VZHDW�WKURXJK�WLQ\�SRUHV���7KLV�FRPELQDWLRQ�RI�QDNHG�VNLQ�DQG�ZDWHU\�VZHDW�WKDW�VLWV�GLUHFWO\�DWRS�LW�UDWKHU�WKDQ�FROOHFWLQJ�LQ�WKH�IXU�DOORZV�KXPDQV�WR�HOLPLQDWH�H[FHVV�KHDU�YHU\�HIILFLHQWO\«RXU�FRROLQJ�V\VWHP�LV�VR�VXSHULRU�WKDW�LQ�D�PDUDWKRQ�RQ�D�KRW�GD\��D�KXPDQ�FRXOG�RXW�FRPSHWH�D�KRUVH��

���

3J����±�$TXDWLF�$SH�7KHRU\�±�KROGV�WKDW�DURXQG�ILYH�PLOOLRQ�WR�VHYHQ�PLOOLRQ�\HDUV�DJR�WHFWRQLF�XSKHDYDOV�LQ�WKH�5LIW�9DOOH\�RI�(DVW�$IULFD�FXU�HDUO\�KXPDQ�DQFHVWRUV�RII�IURP�WKHLU�SUHIHUUHG�WURSLFDO�IRUHVW�HQYLURQPHQWV���$V�D�UHVXOW��WKH\�KDG�WR�DGDSW�WR�D�VHPLDTXDWLF�OLIH�LQ�PDUVKHV��DORQJ�FRDVWV�DQG�LQ�IORRGSODLQV��ZKHUH�WKH\�OLYHG�IRU�DERXW�D�PLOOLRQV�\HDUV��3J����±�7KH�WUDQVIRUPDWLRQ�VHHPV�WR�KDYH�EHJXQ�ZLWK�FOLPDWH�FKDQJH���%\�XVLQJ�IRVVLOV�RI�DQLPDOV�DQG�SODQWV�WR�UHFRQVWUXFW�DQFLHQW�HFRORJLFDO�FRQGLWLRQV��VFLHQWLVWV�KDYH�GHWHUPLQHG�WKDW�VWDUWLQJ�DURXQG�WKUHH�PLOOLRQ�\HDUV�DJR�WKH�HDUWK�HQWHUHG�LQWR�D�SKDVH�RI�JOREDO�FRROLQJ�WKDW�KDG�D�GU\LQJ�HIIHFW�LQ�(DVW�DQG�&HQWUDO�$IULFD��ZKHUH�KXPDQ�DQFHVWRUV�OLYHG���:LWK�WKLV�GHFOLQH�LQ�UHJXODU�UDLQIDOO��WKH�ZRRGHG�HQYLURQPHQWV�IDYRUHG�E\�HDUO\�KRPLQLGV�JDYH�ZD\�WR�RSHQ�VDYDQQD�JUDVVODQGV��DQG�WKH�IRRGV�WKDW�RXU�DQFHVWRUV�WKH�DXVWUDORSLWKHFLQHV�VXEVLVWHG�RQ�IUXLWV��OHDYHV��WXEHUV�DQG�VHHGV�EHFDPH�VFDUFHU��PRUH�SDWFKLO\�GLVWULEXWHG�DQG�VXEMHFW�WR�VHDVRQDO�DYDLODELOLW\��DV�GLG�SHUPDQHQW�VRXUFHV�RI�IUHVKZDWHU���,Q�UHVSRQVH�WR�WKLV�VZLQGOLQJ�RI�UHVRXUFHV��RXU�IRUHEHDUV�ZRXOG�KDYH�KDG�WR�DEDQGRQ�WKHLU�UHODWLYHO\�OHLVXUHO\�IRUDJLQJ�KDELWV�IRU�D�PXFK�PRUH�FRQVLVWHQWO\�DFWLYH�ZD\�RI�OLIH�MXVW�WR�VWD\�K\GUDWHG�DQG�REWDLQ�HQRXJK�FDORULHV��WUDYHOLQJ�HYHU�ORQJHU�GLVWDQFHV�LQ�VHDUFK�RI�ZDWHU�DQG�HGLEOH�SODQW�IRRGV���,QFUHDVHG�ZDONLQJ�DQG�UXQQLQJ��GXULQJ�ZKLFK�PXVFOH�DFWLYLW\�EXLOGV�XS�KHDW�LQWHUQDOO\��ZRXOG�KDYH�UHTXLUHG�WKDW�KRPLQLGV�ERWK�HQKDQFH�WKHLU�HFFULQH�VZHDWLQJ�DELOLW\�DQG�ORVH�WKHLU�ERG\�KDLU�WR�DYRLG�RYHUKHDWLQJ��3J�������±�7KLV�PHWDPRUSKRVLV�RFFXUUHG�DERXW�����PLOOLRQ�\HDUV�WKHUH�ZDV�DQ�HDUO\�PHPEHU�RI�RXU�JHQXV�FDOOHG�+RPR�HUJDVWHU�ZKR�HYROYHG�HVVHQWLDOO\�PRGHUQ�ERG\�SURSRUWLRQV��ZKLFK�ZRXOG�KDYH�SHUPLWWHG�SURORQJHG�ZDONLQJ�DQG�UXQQLQJ���0RUHRYHU��GHWDLOV�RI�WKH�MRLQW�VXUIDFHV�RI�WKH�DQNOH��NQHH�DQG�KLS�PDNH�FOHDU�WKDW�WKHVH�KRPLQLGV�DFWXDOO\�H[HUWHG�WKHPVHOYHV�LQ�WKLV�ZD\���7KXV��DFFRUGLQJ�WR�WKH�IRVVLO�HYLGHQFH��WKH�WUDQVLWLRQ�WR�QDNHG�VNLQ�DQG�DQ�HFFULQH�EDVHG�VZHDWLQJ�V\VWHP�PXVW�KDYH�EHHQ�ZHOO�XQGHU�ZD\�E\�����PLOOLRQ�\HDUV�DJR�WR�RIIVHW�WKH�JUHDWHU�KHDW�ORDGV�WKDW�DFFRPSDQLHG�RXU�SUHGHFHVVRUV¶�QHZO\�VWUHQXRXV�ZD\�RI�OLIH���7KH�KXPQ0&�5�JHQH�LV�DPRQJ�WKH�JHQHV�UHVSRQVLEOH�IRU�SURGXFLQJ�VNLQ�SLJPHQWDWLRQ���,W�ZDV�IRXQG�WKDW�D�VSHFLILF�JHQH�YDULDQW�DOZD\V�IRXQG�LQ�$IULFDQV�ZLWK�GDUN�SLJPHQWDWLRQ�RULJLQDWHG�DV�PDQ\�DV�����PLOOLRQ�\HDUV�DJR���(DUO\�KXPDQ�DQFHVWRUV�DUH�EHOLHYHG�WR�KDYH�KDG�SLQNLVK�VNLQ�FRYHUHG�ZLWK�EODFN�IXU��PXFK�DV�FKLPSDQ]HHV�GR��VR�WKH�HYROXWLRQ�RI�SHUPDQHQWO\�GDUN�VNLQ�ZDV�SUHVXPDEO\�D�UHTXLVLWH�HYROXWLRQDU\�IROORZ�XS�WR�WKH�ORVV�RI�RXU�VXQ�VKLHOGLQJ�ERG\�KDLU��3J����±�+RZ�GLG�KRPLQLGV�HYROYH�EDUH�IOHVK"��+LQWV�KDYH�HPHUJHG�IURP�ODUJH�VFDOH�FRPSDULVRQV�RI�WKH�VHTXHQFHV�RI�'1$�³FRGH�OHWWHUV�´�SU�QXFOHRWLGHV��LQ�WKH�HQWLUH�JHQRPHV�RI�GLIIHUHQW�RUJDQLVPV���&RPSDULVRQ�RI�WKH�KXPDQ�DQG�FKLPS�JHQRPHV�UHYHDOV�WKDW�RQH�RI�WKH�PRVW�VLJQLILFDQW�GLIIHUHQFHV�EHWZHHQ�FKLPS�'1$�DQG�RXU�RZQ�OLHV�LQ�WKH�JHQHV�WKDW�FRGH�IRU�SURWHLQV�WKDW�FRQWURO�SURSHUWLHV�RI�WKH�VNLQ���7KH�KXPDQ�YHUVLRQV�RI�VRPH�RI�WKRVH�JHQHV�HQFRGH�SURWHLQV�WKDW�KHOS�WR�PDNH�RXU�VNLQ�SDUWLFXODUO\�ZDWHUSURRI�DQG�VFXII�UHVLVWDQW�FULWLFDO�SURSHUWLHV��JLYHQ�WKH�DEVHQFH�RI�SURWHFWLYH�IXU���7KLV�ILQGLQJ�LPSOLHV�WKDW�WKH�DGYHQW�RI�WKRVH�JHQH�YDULDQWV�FRQWULEXWHG�WR�WKH�RULJLQ�RI�QDNHGQHVV�E\�PLWLJDWLQJ�LWV�FRQVHTXHQFHV��

���

3J�������±�7KH�RXWVWDQGLQJ�EDUULHU�FDSDELOLWLHV�RI�RXU�VNLQ�DULVH�IURP�WKH�VWUXFWXUH�DQG�PDNHXS�RI�LWV�RXWHUPRVW�OD\HU��WKH�VWUDWXP�FRUQHXP��6&��RI�WKH�HSLGHUPLV���7KH�6&�KDV�ZKDW�KDV�EHHQ�GHVFULEHG�DV�D�EULFNV�DQG�PRUWDU�FRPSRVLWLRQ���,Q�WKLV�DUUDQJHPHQW��PXOWLSOH�OD\HUV�RI�IODWWHQHG�GHDG�FHOOV�FDOOHG�FRUQHRF\WHV��ZKLFK�FRQWDLQ�WKH�SURWHLQ�.HUDWLQ�DQG�RWKHU�VXEVWDQFHV��DUH�WKH�EULFNV��XOWUD�WKLQ�OD\HUV�RI�OLSLGV�VXUURXQGLQJ�HDFK�RI�WKH�FRUQHRF\WHV�PDNH�XS�WKH�PRUWDU���0RVW�RI�WKH�JHQHV�WKDW�GLUHFW�WKH�GHYHORSPHQW�RI�WKH�6&�DUH�DQFLHQW��DQG�WKHLU�VHTXHQFHV�DUH�KLJKO\�FRQVHUYHG�DPRQJ�YHUWHEUDWHV���7KDW�WKH�JHQHV�XQGHUJLUGLQJ�WKH�KXPDQ�6&�DUH�VR�GLVWLQFWLYH�VLJQLILHV��WKHUHIRUH��WKDW�WKH�DGYHQW�RI�WKRVH�JHQHV�ZDV�LPSRUWDQW�WR�VXUYLYDO���7KHVH�JHQHV�HQFRGH�WKH�SURGXFWLRQ�RI�D�XQLTXH�FRPELQDWLRQ�RI�SURWHLQV�WKDW�RFFXU�RQO\�LQ�WKH�HSLGHUPLV��LQFOXGLQJ�QRYHO�W\SHV�RI�NHUDWLQ�DQG�LQYROXFULQ���+XPDQ�KDLU�NHUDWLQV�ZHUH�QRW�DV�LPSRUWDQW�WR�VXUYLYDO�DV�WKH�KDLU�NHUDWLQV�RI�RWKHU�SULPDWHV�ZHUH�RYHU�WKH�FRXUVH�RI�HYROXWLRQ�DQG�WKLV�EHFDPH�ZHDN��3J����±�+RZ�GLG�KXPDQ�VNLQ�FRPH�WR�FRQWDLQ�VXFK�DQ�DEXQGDQFH�RI�HFFULQH�JODQGV"��$OPRVW�FHUWDLQO\�WKLV�DFFXPXODWLRQ�RFFXUUHG�WKURXJK�FKDQJHV�LQ�WKH�JHQHV�WKDW�GHWHUPLQH�WKH�IDWH�RI�HSLGHUPDO�VWHP�FHOOV��ZKLFK�DUH�XQVSHFLDOL]HG��LQ�WKH�HPEU\R���(DUO\�LQ�GHYHORSPHQW��JURXSV�RI�HSLGHUPDO�VWHP�FHOOV�LQ�VSHFLILF�ORFDWLRQV�LQWHUDFW�ZLWK�FHOOV�RI�WKH�XQGHUO\LQJ�GHUPLV��DQG�JHQHWLFDOO\�GULYHQ�FKHPLFDO�VLJQDOV�ZLWKLQ�WKHVH�QLFKHV�GLUHFW�WKH�GLIIHUHQWLDWLRQ�RI�WKH�VWHP�FHOOV�LQWR�KDLU�IROOLFOHV��HFFULQH�JODQGV��DSRFULQH�JODQGV��VHEDFHRXV�JODQGV�RU�SODLQ�HSLGHUPLV���+DLU�LQ�WKH�DUPSLWV�DQG�JURLQ�SUREDEO\�VHUYHV�ERWK�WR�SURSDJDWH�SKHURPRQHV��FKHPLFDOV�WKDW�VHUYH�WR�HOLFLW�D�EHKDYLRUDO�UHVSRQVH�IURP�RWKHU�LQGLYLGXDOV��DQG�WR�KHOS�NHHS�WKHVH�DUHDV�OXEULFDWHG�GXULQJ�ORFRPRWLRQ���$V�IRU�KDLU�RQ�WKH�KHDG��LW�ZDV�PRVW�OLNHO\�UHWDLQHG�WR�KHOS�VKLHOG�DJDLQVW�H[FHVV�KHDW�RQ�WKH�WRS�RI�WKH�KHDG���7KDW�QRWLRQ�PD\�VRXQG�SDUDGR[LFDO��EXW�KDYLQJ�GHQVH�KDLU�RQ�WKH�KHDG�FUHDWHV�D�EDUULHU�OD\HU�RI�DLU�EHWZHHQ�WKH�VHDWLQJ�VFDOS�DQG�WKH�KRW�VXUIDFH�RI�WKH�KDLU���WKXV��RQ�D�KRW��VXQQ\�GD\�WKH�KDLU�DEVRUEV�WKH�KHDW�ZKLOH�WKH��EDUULHU�OD\HU�RI�DLU�UHPDLQV�FRROHU��DOORZLQJ�VZHDW�RQ�VFDOS�WR�HYDSRUDWH�LQWR�WKH�OD\HU�RI�DLU���7LJKWO\�FXUOHG�KDLU�SURYLGHV�WKH�RSWLPXP�KHDG�FRYHULQJ�LQ�WKLV�UHJDUG��EHFDXVH�LW�LQFUHDVHV�WKH�WKLFNQHVV�RI�WKH�VSDFH�EHWZHHQ�WKH�VXUIDFH�RI�WKH�KDLU�DQG�WKH�VFDOS��DOORZLQJ�DLU�WR�EORZ�WKURXJK���0XFK�UHPDLQV�WR�EH�GLVFRYHUHG�DERXW�WKH�HYROXWLRQ�RI�KXPDQ�KHDG�KDLU��%XW�LW�LV�SRVVLEOH�WKDW�WLJKWO\�FXUOHG�KDLU�ZDV�WKH�RULJLQDO�FRQGLWLRQ�LQ�PRGHUQ�KXPDQV�DQG�WKDW�RWKHU�KDLU�W\SHV�HYROYHG�DV�KXPDQV�GLVSHUVHG�RXW�RI�WURSLFDO�$IULFD���3HRSOH�ZLWK�WKH�OHDVW�ERG\�KDLU�WHQG�WR�OLYH�LQ�WKH�WURSLFV��ZKHUHDV�WKRVH�ZLWK�WKH�PRVW�WHQG�WR�OLYH�RXWVLGH�WKH�WURSLFV���<HW�KDLU�RQ�QRQ�WURSLFDO�SHRSOH�SURYLGHV�QR�ZDUPWK�WR�VSHDN�RI���7KHVH�GLIIHUHQFHV�LQ�KDLULQHVV�FOHDUO\�VWHP�WR�VRPH�H[WHQW�IURP�WHVWRVWHURQH��EHFDXVH�PDOHV�LQ�DOO�SRSXODWLRQV�KDYH�PRUH�ERG\�KDLU�WKDQ�IHPDOHV�GR��3J����±�*RLQJ�IXUOHVV�ZDV�QRW�PHUHO\�D�PHDQV�WR�DQ�HQG��LW�KDG�SURIRXQG�FRQVHTXHQFHV�IRU�VXEVHTXHQW�SKDVHV�RI�KXPDQ�HYROXWLRQ���7KH�ORVV�RI�PRVW�RI�RXU�ERG\�KDLU�DQG�WKH�JDLQ�RI�WKH�DELOLW\�WR�GLVVLSDWH�H[FHVV�ERG\�KHDW�WKURXJK�HFFULQH�VZHDWLQJ�KHOSHG�WR�PDNH�SRVVLEOH�WKH�GUDPDWLF�HQODUJHPHQW�RI�RXU�PRVW�WHPSHUDWXUH�VHQVLWLYH�RUJDQ��WKH�EUDLQ���:KHUHDV�WKH�DXVWUDORSLWKHFLQHV�KDG�D�EUDLQ�WKDW�ZDV��RQ�DYHUDJH������FXELF�FHQWLPHWHUV�URXJKO\�WKH�VL]H�RI�D�FKLPS¶V�EUDLQ�+RPR�HUJDVWHU�KDG�D�EUDLQ�WZLFH�WKDW�ODUJH���$QG�ZLWKLQ�D�PLOOLRQ�\HDUV�WKH�KXPDQ�EUDLQ�VZHOOHG�DQRWKHU�����FXELF�FHQWLPHWHUV��UHDFKLQJ�LWV�PRGHUQ�VL]H���1R�GRXEW�RWKHU�IDFWRUV�LQIOXHQFHG�WKH�H[SDQVLRQ�RI�RXU�JUD\�PDWWHU�WKH�DGRSWLRQ�RI�D�VXIILFLHQWO\�FDORULF�GLHW�WR�IXHO�WKLV�HQHUJHWLFDOO\�GHPDQGLQJ�WLVVXH��IRU�

���

H[DPSOH���%XW�VKHGGLQJ�RXU�ERG\�KDLU�ZDV�VXUHO\�D�FULWLFDO�VWHS�LQ�EHFRPLQJ�EUDLQ\�2XU�KDLUOHVVQHVV�DOVR�KDG�VRFLDO�UHSHUFXVVLRQV���$OWKRXJK�ZH�FDQ�WHFKQLFDOO\�UDLVH�DQG�ORZHU�RXU�KDFNOHV�ZKHQ�WKH�VPDOO�PXVFOHV�DW�WKH�EDVH�RI�RXU�KDLU�IROOLFOHV�FRQWUDFW�DQG�UHOD[�RXU�ERG\�KDLUV�DUH�VRS�WKLQ�DQG�ZLVS\�WKDW�ZH�GR�QRW�SXW�RQ�PXFK�RI�D�VKRZ�FRPSDUHG�ZLWK�WKH�GLVSOD\V�RI�RXU�FDWV�DQG�GRJV�RU�RI�RXU�FKLPSDQ]HH�FRXVLQV���1HLWKHU�GR�ZH�KDYH�WKH�EXLOW�LQ�DGYHUWLVLQJ�RU�FDPRXIODJH�RIIHUHG�E\�]HEUD�VWULSHV��OHRSDUG�VSRWV��DQG�WKH�OLNH���,QGHHG��RQH�PLJKW�HYHQ�VSHFXODWH�WKDW�XQLYHUVDO�KXPDQ�WUDLWV�VXFK�DV�VRFLDO�EOXVKLQJ�DQG�FRPSOH[�IDFLDO�H[SUHVVLRQV�HYROYHG�WR�FRPSHQVDWH�IRU�RXU�ORVW�DELOLW\�WR�FRPPXQLFDWH�WKURXJK�RXU�IXU���/LNHZLVH��ERG\�SDLQW��FRVPHWLFV��WDWWRRV�DQG�RWKHU�W\SHV�RI�VNLQ�GHFRUDWLRQ�DUH�IRXQG�LQ�YDULRXV�FRPELQDWLRQV�LQ�DOO�FXOWXUHV��EHFDXVH�WKH\�FRQYH\�JURXS�PHPEHUVKLS��VWDWXV�DQG�RWKHU�YLWDO�VRFLDO�LQIRUPDWLRQ�IRUPHUO\�HQFRGHG�E\�IXU���:H�DOVR�HPSOR\�ERG\�SRVWXUHV�DQG�JHVWXUHV�WR�EURDGFDVW�RXU�HPRWLRQDO�VWDWHV�DQG�LQWHQWLRQV���$QG�ZH�XVH�ODQJXDJH�WR�VSHDN�RXU�PLQG�LQ�GHWDLO���9LHZHG�WKLV�ZD\��QDNHG�VNLQ�GLG�QRW�MXVW�FRRO�XV�GRZQ�LW�PDGH�XV�KXPDQ��3J����±�:KHQ�1DNHGQHVV�(YROYHG3URWRKXPDQV�VXFK�DV�WKH�DXVWUDORSLWKHFLQHV�SUREDEO\�OHG�UHODWLYHO\�VHGHQWDU\�OLYHV��DV�WRGD\¶V�DSHV�GR��EHFDXVH�WKH\�OLYHG�LQ�RU�QHDU�ZRRGHG�HQYLURQPHQWV�ULFK�LQ�SODQW�IRRGV�DQG�IUHVKZDWHU���%XW�DV�ZRRGODQGV�VKUDQN�DQG�JUDVVODQGV�H[SDQGHG��ODWHU�DQFHVWRUV��VXFK�DV�+RPR�HUJDVWHU��KDG�WR�WUDYHO�HYHU�IDUWKHU�LQ�VHDUFK�RI�VXVWHQDQFH�LQFOXGLQJ�PHDW���7KLV�VSHFLHV�ZKLFK�DURVH�E\�����PLOOLRQ�\HDUV�DJR�ZDV�SUREDEO\�WKH�ILUVW�WR�SRVVHVV�QDNHG�VNLQ�DQG�HFFULQH�VZHDW��ZKLFK�ZRXOG�KDYH�RIIVHW�WKH�ERG\�KHDW�JHQHUDWHG�E\�VXFK�HOHYDWHG�DFWLYLW\�OHYHOV��3J����±�%HDWLQJ�WKH�+HDW1DNHG�VNLQ�LV�QRW�WKH�RQO\�DGDSWDWLRQ�KXPDQV�HYROYHG�WR�PDLQWDLQ�D�KHDOWK\�ERG\�WHPSHUDWXUH�LQ�WKH�VZHOWHULQJ�WURSLFV�ZKHUH�RXU�DQFHVWRUV�OLYHG���7KH\�DOVR�GHYHORSHG�ORQJHU�OLPEV��LQFUHDVLQJ�WKHLU�VXUIDFH�WR�YROXPH�UDWLR��ZKLFK�LQ�WXUQ�IDFLOLWDWHG�WKH�ORVV�RI�H[FHVV�KHDW���7KDW�WUHQG�VHHPV�WR�EH�FRQWLQXLQJ�HYHQ�WRGD\���7KH�EHVW�HYLGHQFH�RI�WKLV�VXVWDLQHG�DGDSWDWLRQ�FRPHV�IURP�SRSXODWLRQV�LQ�(DVW�$IULFD��VXFK�DV�WKH�'LQND�RI�VRXWKHUQ�6XGDQ���,W�LV�QR�FRLQFLGHQFH�WKDW�WKHVH�SHRSOH��ZKR�OLYH�LQ�RQH�RI�WKH�KRWWHVW�SODFHV�RQ�HDUWK��DOVR�KDYH�H[WUHPHO\�ORQJ�OLPEV�:K\�GR�PRGHUQ�KXPDQV�H[KLELW�VXFK�D�ZLGH�UDQJH�RI�OLPE�SURSRUWLRQV"��$V�RXU�IRUHEHDUV�PLJUDWHG�RXW�RI�WURSLFDO�$IULFD�LQWR�FRROHU�SDUWV�RI�WKH�ZRUOG��WKH�VHOHFWLRQ�SUHVVXUHV�FKDQJHG��DOORZLQJ�IRU�D�YDULHW\�RI�ERG\�VKDSHV�WR�HYROYH���>6HH�$SSHQGL[����±�%HUJPDQQ¶V�UXOH@����������

���$SSHQGL[����*ORJHU¶V�5XOH�±�QDPHG�DIWHU�]RRORJLVW�&RQVWDQLQ�:LOKHOP�/DPEHUW�*ORJHU��ZKR�ILUVW�UHPDUNHG�XSRQ�WKLV�SKHQRPHQRQ�LQ������LQ�D�UHYLHZ�RI�FRYDULDWLRQ�RI�FOLPDWH�DQG�DYLDQ�SOXPDJH�FRORU�������*ORJHU¶V�UXOH�LV�D�]RRORJLFDO�UXOH�ZKLFK�VWDWHV�WKDW�ZLWKLQ�D�VSHFLHV�RI�HQGRWKHUPV��PDPPDOV�DQG�ELUGV���PRUH�KHDYLO\�SLJPHQWHG�IRUPV�WHQG�WR�H�IRXQG�LQ�PRUH�KXPLG�HQYLURQPHQWV��H�J��QHDU�WKH�HTXDWRU���*ORJHU�IRXQG�WKDW�ELUGV�LQ�PRUH�KXPLG�KDELWDWV�WHQGHG�WR�EH�GDUNHU�WKDQ�WKHLU�UHODWLYHV�IURP�UHJLRQV�ZLWK�KLJKHU�DULGLW\���2YHU�����RI�WKH�VSHFLHV�UHVHDUFKHG�FRQIRUP�WR�WKLV�UXOH���$Q�H[SODQDWLRQ�RI�*ORJHU¶V�UXOH�LQ�WKH�FDVH�RI�ELUGV�DSSHDUV�WR�EH�WKH�LQFUHDVHG�UHVLVWDQFH�RI�GDUN�IHDWKHUV�WR�IHDWKHU�RU�KDLU�GHJUDGLQJ�EDFWHULD��%DFLOLV�OLFKHQLIRUPLV����)HDWKHUV�LQ�KXPLG�HQYLURQPHQWV�KDYH�D�JUHDWHU�EDFWHULDO�ORDG��DQG�KXPLG�HQYLURQPHQWV�DUH�PRUH�VXLWDEOH�IRU�PLFURELDO�JURZWK��GDUN�IHDWKHUV�RU�KDLU�DUH�PRUH�GLIILFXOW�WR�EUHDN�GRZQ����������(XPHODQLQ�LV�WKH�PRVW�DEXQGDQW�W\SH�RI�PHODQLQ�LQ�WKH�KXPDQ�ERG\���(XPHODQLQ�LV�D�GDUN�EURZQ�RU�EODFN�SLJPHQW�FRPSRVHG�RI�DQ�DJJUHJDWH�RI�VPDOO�VXEXQLWV��SRO\PHUV����(XPHODQLQ�LPSDUWV�YDU\LQJ�VKDGHV�RI�EURZQ�WR�KDLU�DQG�VNLQ��ZLWK�KLJK�FRQFHQWUDWLRQV�IRXQG�LQ�WKH�VNLQ�RI�GDUNO\�SLJPHQWHG�SHRSOH��0RUH�UHVLOLHQW�HXPHODQLQV�DUH�GHSRVLWHG�LQ�KRW�DQG�KXPLG�UHJLRQV��������3KHRPHODQLQ�DUH�WKH�UHGGLVK�RU�\HOORZ�W\SH�RI�PHODQLQ�IRXQG�LQ�WKH�KDLU�DQG�VNLQ�RI�OLJKWO\�SLJPHQWHG�SHRSOH���3KHRPHODQLQ�LV�D�SRO\PHULF�SLJPHQW�FRPSRVHG�RI�PXOWLSOH�VPDOOHU�VXEXQLWV���3KHRPHODQLQ�JHQHUDWHV�UDWKHU�WKDQ�QHXWUDOL]HV�IUHH�UDGLFDOV�ZKHQ�LW�LV�H[SRVHG�WR�895�DQG�WKXV�PD\�EH�LPSOLFDWHG�LQ�WKH�GHYHORSPHQW�RI�VNLQ�FDQFHU�LQ�OLJKWHU�FRPSOH[LRQHG�SHRSOH�8OWUD�9LROHW�5DGLDWLRQ��895��LV�WKH�W\SH�RI�VRODU�UDGLDWLRQ�WKDW�LV�RI�VKRUWHU�ZDYHOHQJWK�DQG�WKHUHIRUH�JUHDWHU�HQHUJ\�WKDQ�YLVLEOH�OLJKW���895�FRPSULVHV�WKH�UDQJH�RI�ZDYHOHQJWKV�IURP�����WR�����QDQRPHWHUV���7KHUH�DUH�WKUHH�W\SHV�RI�895����895�$�±�8OWUDYLROHW�UDGLDWLRQ�RI�UHODWLYHO\�ORZ�HQHUJ\��VSDQQLQJ�ZDYHOHQJWKV�IURP�����WR�����QDQRPHWHUV����895�%�±�8OWUDYLROHW�UDGLDWLRQ�RI�UHODWLYHO\�KLJK�HQHUJ\��VSDQQLQJ�ZDYHOHQJWKV�IURP�����WR����QDQRPHWHUV����895�&�±�7KH�KLJKHVW�XOWUDYLROHW�UDGLDWLRQ��VSDQQLQJ�ZDYHOHQJWKV�IURP�����WR�����QDQRPHWHUV������)UHH�UDGLFDOV�DUH�VKRUW�OLYHG��KLJKO\�UHDFWLYH�PROHFXOHV�WKDW�KDYH�RQH�RU�PRUH�XQSDLUHG�HOHFWURQV�DG�DUH�FRPPRQ�E\�SURGXFWV�RI�QRUPDO�FKHPLFDO�UHDFWLRQV�RFFXUULQJ�LQ�FHOOV���$PRQJ�WKH�PRVW�FRPPRQ�DUH�WKH�VXSHUR[LGH�DQG�K\GURJHQ�SHUR[LGH�LRQV���,Q�VFLHQWLILF�OLWHUDWXUH��WKH\�DUH�RIWHQ�FDOOHG�UHDFWLYH�R[\JHQ�VSHFLHV���)UHH�UDGLFDOV�DUH�SURGXFHG�E\�895�DQG�FDQ�GDPDJH�'1$��,Q�DULG�UHJLRQV��SKHRPHODQLQ�SUHGRPLQDWH�WR�WKH�EHQHILW�RI�FU\SVLV�

���

�����$PRQJ�PDPPDOV��WKHUH�LV�D�PDUNHG�WHQGHQF\�LQ�HTXDWRULDO�DQG�WURSLFDO�UHJLRQV�WR�KDYH�D�GDUNHU�VNLQ�FRORU�WKDW�SROH�ZDUG�UHODWLYHV���,Q�WKLV�FDVH��WKH�XQGHUO\LQJ�FDXVH�LV�SUREDEO\�WKH�QHHG�WR�EHWWHU�XWLOL]H�WKH�VXQ¶V�89�UDGLDWLRQ�ZLWK�GHFUHDVLQJ�ODWLWXGH���$EVRUSWLRQ�RI�D�FHUWDLQ�DPRXQW�RI�89�UDGLDWLRQ�LV�QHFHVVDU\�IRU�WKH�SURGXFWLRQ�FHUWDLQ�YLWDPLQV��QRWDEO\�9LWDPLQ�'�>9LWDPLQ�'�LV�DQ�HVVHQWLDO�YLWDPLQ�WKDW�LV�UHVSRQVLEOH�IRU�WKH�DEVRUSWLRQ�RI�GLHWDU\�FDOFLXP�IURP�WKH�GLJHVWLYH�V\VWHP�DQG�LV�QHFHVVDU\�IRU�WKH�JURZWK�DQG�VWUHQJWK�RI�ERQHV���7KH�PDQXIDFWXUH�RI�YLWDPLQ�'�EHJLQV�IURP�FKROHVWHURO�SUHFXUVRUV�LQ�WKH�VNLQ��WULJJHUHG�E\�895%�LQ�VXQOLJKW���7KH�ELRDFWLYH�IRUP�RI�WKH�YLWDPLQ��YLWDPLQ�'���LV�SURGXFHG�YLD�D�VHULHV�RI�FKHPLFDO�WUDQVIRUPDWLRQV�WKDW�WDNH�SODFH�LQ�WKH�OLYHU�DQG�NLGQH\�DIWHU�WKH�SURFHVV�LV�LQLWLDWHG�LQ�WKH�VNLQ�@�����7KLV�SULQFLSOH�LV�DOVR�YLYLGO\�GHPRQVWUDWHG�DPRQJ�KXPDQ�SRSXODWLRQV���3RSXODWLRQV�WKDW�HYROYHG�,�Q�VXQQLHU�HQYLURQPHQWV�FORVHU�WR�WKH�HTXDWRU�WHQG�WR�EH�GDUNHU�SLJPHQWHG�WKDQ�SRSXODWLRQV�RULJLQDWLQJ�IDUWKHU�IURP�WKH�HTXDWRU���$OOHQ¶V�5XOH�����$OOHQ¶V�UXOH�LV�D�ELRORJLFDO�UXOH�SRVLWHG�E\�-RHO�$VDSK�$OOHQ�LQ�������������,W�VWDWHV�WKDW�HQGRWKHUPV�IURP�FROGHU�FOLPDWHV�XVXDOO\�KDYH�VKRUWHU�OLPEV��RU�DSSHQGDJHV��WKDQ�WKH�HTXLYDOHQW�DQLPDOV�IURP�ZDUPHU�FOLPDWHV������$OOHQ¶V�UXOH�VWDWHV�WKDW�HQGRWKHUPLF�DQLPDOV��PDPPDOV�DQG�ELUGV��ZLWK�WKH�VDPH�YROXPH�PD\�KDYH�GLIIHULQJ�VXUIDFH�DUHDV��ZKLFK�ZLOO�DLG�RU�LPSHGH�WKHLU�WHPSHUDWXUH�UHJXODWLRQ������,Q�FROG�FOLPDWHV��WKH�JUHDWHU�WKH�H[SRVHG�VXUIDFH�DUHD��WKH�JUHDWHU�WKH�ORVV�RI�KHDW�DQG�WKHUHIRUH�HQHUJ\���$QLPDOV��DQG�+XPDQV��LQ�FROG�FOLPDWHV�QHHG�WR�FRQVHUYH�DV�PXFK�HQHUJ\�DV�SRVVLEOH���$�ORZ�VXUIDFH�DUHD�WR�YROXPH�UDWLR�KHOSV�WR�FRQVHUYH�KHDW������,Q�ZDUP�FOLPDWHV��WKH�RSSRVLWH�LV�WUXH���$Q�DQLPDO�ZLOO�RYHUKHDW�TXLFNO\�LI�LW�KDV�D�ORZ�VXUIDFH�DUHD�WR�YROXPH�UDWLR���7KHUHIRUH��DQLPDOV�LQ�ZDUP�FOLPDWHV�ZLOO�KDYH�KLJK�VXUIDFH�DUHD�WR�YROXPH�UDWLRV�VR�DV�WR�KHOS�WKHP�ORVH�KHDW������,Q�D�QXWVKHOO��LW�VLPSO\�PHDQV�WKHUH�LV�D�UDWLR�EHWZHHQ�ERG\�VXUIDFHV�WR�ERG\�PDVV���)RU�H[DPSOH��)XU�RU�7XWVL�SHRSOH�RI�$IULFD�UHOHDVH�ERG\�KHDW�PRUH�UHDGLO\�EHFDXVH�WKHLU�UDWLRQ�LV�KLJK���+RZHYHU��(VNLPRV�DQG�,QXLW�KDYH�D�ORZHU�UDWLR�DQG�WKHUHIRUH�UHWDLQ�ERG\�KHDW��%HUJPDQQ¶V�5XOH�����%HUJPDQQ¶V�UXOH�LV�D�]RRORJLFDO�UXOH�QDPHG�DIWHU�D�ELRORJLVW�QDPHG�&KULVWLDQ�%HUJPDQQ�ZKR�ILUVW�IRUPXODWHG�WKH�UXOH�LQ������������,W�LV�DQ�HFRJHRJUDSKLFDO�UXOH�WKDW�FRUUHODWHV�ODWLWXGH�ZLWK�ERG\�PDVV�LQ�DQLPDOV���%URDGO\�LW�DVVHUWV�WKDW�ZLWKLQ�D�VSHFLHV�WKH�ERG\�PDVV�LQFUHDVHV�ZLWK�ODWLWXGH�DQG�FROGHU�FOLPDWH��RU�WKDW�ZLWKLQ�FORVHO\�UHODWHG�VSHFLHV�WKDW�GLIIHU�RQO\�LQ�UHODWLRQ�WR�VL]H�WKDW�RQH�ZRXOG�H[SHFW�WKH�ODUJHU�VSHFLHV�WR�EH�IRXQG�DW�WKH�KLJKHU�ODWLWXGH���7KH�UXOH�LV�RIWHQ�DSSOLHG�RQO\�WR�PDPPDOV�DQG�ELUGV��HQGRWKHUPV���EXW�VRPH�UHVHDUFKHUV�KDYH�DOVR�IRXQG�HYLGHQFH�IRU�WKH�UXOH�LQ�VWXGLHV�RI�HFWRWKHUPLF�VSHFLHV��������/DUJHU�DQLPDOV�KDYH�D�ORZHU�VXUIDFH�DUHD�WR�YROXPH�WKDQ�VPDOOHU�DQLPDOV��VR�WKH\�UDGLDWH�OHVV�ERG\�KHDW�SHU�XQLW�RI�PDVV��DQG�VWD\�ZDUPHU�LQ�FROG�FOLPDWHV���2Q�WKH�RWKHU�KDQG��ZDUPHU�FOLPDWHV�LPSRVH�WKH�RSSRVLWH�SUREOHP���ERG\�KHDW�JHQHUDWHG�E\�PHWDEROLVP�QHHGV�WR�EH�GLVVLSDWHG�TXLFNO\�UDWKHU�WKDQ�VWRUHG�ZLWKLQ���7KXV��WKH�KLJKHU�VXUIDFH�DUHD�WR�

���

YROXPH�UDWLR�RI�VPDOOHU�DQLPDOV�LQ�KRW�DQG�GU\�FOLPDWHV�IDFLOLWDWHV�KHDW�ORVV�WKURXJK�WKH�VNLQ�DQG�KHOSV�FRROLQJ�RI�WKH�ERG\����7KH�0RYHPHQW�RI�$QFLHQW�+XPDQLW\�/LIH�$ORQJ�+DSL������$IULFD�KDV�UHPDLQHG�D�ODQG�DUHD�VLQFH�WKH�2UGRYLFLDQ�SHULRG��DSSUR[LPDWHO\�����PLOOLRQ�\HDUV�DJR��DQG�PXFK�RI�LW�VLQFH�WKH�3UHFDPEULDQ�DJH�JRLQJ�EDFN�VRPH�WZR�����ELOOLRQ�\HDUV�DJR���+DSL�9DOOH\�%DVLQ�LV������.P�LQ�OHQJWK�IURP�WKH�/XFURQ]D�5LYHU�LQ�7DQ]DQLD�WR�WKH�0HGLWHUUDQHDQ�6HD��GUDLQLQJ�DQ�DUHD�RI�WKUHH�����PLOOLRQ�VTXDUH�NP�SDVVLQJ�WKURXJK�VL[�����GLIIHUHQW�UHJLRQV�WKDW�GLIIHU�IURP�HDFK�RWKHU�LQ�QDWXUDO�DQG�JHRORJLFDO�KLVWRU\�����7KH�/DNH�3ODWHDX���7KH�6XGG���&HQWUDO�6XGDQ���(WKLRSLDQ�+LJKODQGV���7KH�&DWDUDFWV���.HPHW��(J\SW�������7KH�+RO\�/DQG�RI�WKH�DQFLHQW�.HPLWHV�ZDV�QDPHG��³+RO\�´�EHFDXVH�LW�ZDV�WKH�ELUWKSODFH�RI�WKH�+XPDQ�5DFH���7KH�³.KXL�/DQG´��ORFDWHG�LQ�WKH�*UHDW�/DNHV�UHJLRQ�RI�$IULFD�DW�WKH�KHDG�RI�+DSL��ELUWKSODFH�RI�WKH�DQFHVWRUV�RI�WKH�.HPLWHV��WKH�7ZD�SHRSOH���7KH�7ZD�DUH�WKH�RULJLQDO�SDUHQWV�RI�DOO�KXPDQLW\���7KLV�VDPH�VLWH�LV�ZKHUH�FXUUHQW�VFLHQFH�KDV�IRXQG�WKH�ROGHVW�KXPDQ�VNHOHWDO�UHPDLQV�RI�KXPDQV�LQ�WKH�ZRUOG�PLOOLRQV�RI�\HDUV�LQ�DJH���7KH�VRXUFH�RI�+DSL��WKH�HTXDWRULDO�SURYLQFHV��ZKHUH�WKH�JUHDW�ODNHV�DQG�SDS\UXV�VZDPSV�ZHUH��ZDV�WKHLU�.HPHWLF��³7D�1HWHU´��RU�+RO\�/DQG���7KH�VN\�DV�WKH�*UHDW�&HOHVWLDO�ZDWHU�ZDV�DOVR�GLYLGHG�LQWR�WZR�JUHDW�ODNHV��RQH�WR�WKH�QRUWK��/DNH�RI�.KXUX�DQG�WKH�ODNH�WR�WKH�VRXWK��/DNH�RI�5X���1R�GRXEW�WKLV�ZDV�IRXQGHG�RQ�WKH�WZR�JUHDW�ODNHV�LQ�FHQWUDO�$IULFD��/DNH�0ZDQ]D��9LFWRULD��DQG�/DNH�1\DQ]D��5XGROSK�������7KH�DQFLHQW�.HPLWHV�FOHDUO\�GHILQHG�WKHLU�$IULFDQ�RULJLQ�LQ�WKH�3DS\UL�RI�+XQHIHU�DQG�7XULQ��,WDO\����7KH�DQFLHQW�.HPLWHV�SURFODLPHG�LQ�WKHVH�WZR�GRFXPHQWV��³:H�FDPH�IURP�WKH�EHJLQQLQJ�RI�+DSL��ZKHUH�WKH�1HWHU��*RG��GZHOOV��DW�WKH�IRRWKLOOV�RI�WKH�³0RXQWDLQV�RI�WKH�0RRQ´���7KHVH´�0RXQWDLQV�RI�WKH�0RRQ´�DUH´�.LOLPDQMDUR´�LQ�7DQ]DQLD�DQG�³5ZHQ]RUL´�LQ�5ZDQGD�8JDQGD���7KHUH�LV�D�FXOWXUDO�NLQVKLS�DOO�JURXSV�RI�$IULFDQV�QRUWK��VRXWK��HDVW�ZHVW�DQG�FHQWUDO���7KHVH�OLQJXLVWLF��FXOWXUDO��VRFLRORJLFDO�DQG�SROLWLFDO�IDFWRUV�UHYHDO�WKH�NLQVKLS�WKDW�ELQGV�WKHVH�$IULFDQ�SRSXODWLRQV�WKDW�DUH�SUHVHQWO\�VHSDUDWHG�E\�HQRUPRXV�JHRJUDSKLFDO�GLVWDQFHV���:HVW�$IULFDQ�OHJHQGV�UHSRUW�WKDW�$IULFDQV�PLJUDWHG�IURP�WKH�UHJLRQ�RI�WKH�³*UHDW�:DWHUV´���7KHVH�³*UHDW�:DWHUV´�DUH�WKH�+DSL��1LOH�5LYHU�������1R�PDWWHU�ZKHUH�ZH�FROOHFW�OHJHQGV�RQ�WKH�JHQHVLV�RI�$IULFDQ�SHRSOH��WKRVH�ZKR�VWLOO�UHPHPEHU�WKHLU�RULJLQV��VD\�WKH\�FDPH�IURP�WKH�HDVW�DQG�WKDW�WKHLU�IRUHEHDUV�IRXQG�7ZD�SHRSOH�LQ�WKH�FRXQWU\���$IULFDQ�OHJHQGV�DQFLHQW�DQG�PRGHUQ��5HYHDO�WKH�7ZD�ZHUH�SUREDEO\�WKHLU�IRUHEHDUV�IRXQG�7ZD�SHRSOH�LQ�WKH�FRXQWU\���$IULFDQ�OHJHQGV�DQFLHQW�DQG�PRGHUQ��UHYHDO�WKH�7ZD�ZHUH�SUREDEO\�WKH�ILUVW�WR�RFFXS\�WKH�LQWHULRU�RI�WKH�FRQWLQHQW��DW�

���

OHDVW�DW�D�FHUWDLQ�SHULRG���7KH\�VHWWOHG�LQ�WKLV�DUHD�SULRU�WR�WKH�GHYHORSPHQW�RI�WKH�ODUJHU�$IULFDQV��HLWKHU�WKURXJK�PLJUDWLRQ�RI�KLVWRULFDO�HYROXWLRQ���$IULFDQLVW��'U��&KHLNK�$QWD�'LRS��XVHG�ODQJXDJH�DV�RQH�RI�KLV�DSSURDFKHV�WR�WKH�UHODWLRQVKLS�DPRQJ�GLIIHUHQW�:HVW�$IULFDQ�3HRSOH���2QH�RI�WKHVH�JURXSV�LV�WKH�<RUXEDV�RI�SUHVHQW�GD\��1LJHULD���$�FKDLQ�RI�HYHQWV�OHDG�WR�WKH�FRQFOXVLRQ�WKDW�WKH\�PXVW�KDYH�VHWWOHG�IRU�PDQ\�\HDUV�LQ�WKDW�SDUW�RI�WKH�FRQWLQHQW�NQRZQ�DV�$QFLHQW�.HPHW���,Q�KLV�ERRN��³7KH�5HOLJLRQ�RI�WKH�<RUXEDV�´�E\�-��2OXPLGH�/XFDV��'U��/XFDV�SUHVHQWV�WKH�IDFWV�OHDGLQJ�WR�WKLV�FRQFOXVLRQ���7KHVH�IDFWV�PD\�EH�JURXSHG�XQGHU�WKH�IROORZLQJ�+HDGLQJ����6LPLODULW\�RU�LGHQWLW\�RI�ODQJXDJHE��6LPLODULW\�RU�LGHQWLW\�RI�UHOLJLRXV�EHOLHIVF��6LPLODULW\�RU�LGHQWLW\�RI�UHOLJLRXV�LGHDV�DQG�SUDFWLFHV���6XUYLYDO�RI�FXVWRPV�DQG�QDPHV�RI�SHUVRQV��SODFHV��REMHFWV��HWF������$EXQGDQW�SURRI�RI�LQWLPDWH�FRQQHFWLRQ�EHWZHHQ�WKH�DQFLHQW�W�.HPLWHV�DQG�WKH�<RUXEDQV�PD\�EH�SURGXFHG�XQGHU�WKLV�KHDG���0RVW�RI�WKH�SULQFLSDO�(VVHQFHV�ZHUH�ZHOO�NQRZQ�DW�RQH�WLPH�WR�WKH�<RUXEDQV���$PRQJ�WKHVH�(VVHQFHV�DUH��:VLU��$VHW��+HUX��6KX��7HKXWL��.KHSHUD��$PHQ��$QX��.KRQVX��.KQXP��.KRSUL��+HW�+HUX��6RNDULV��5D��6HE��WKH�IRXU�����HOHPHQWDO�HVVHQFHV�DQG�PDQ\�RWKHUV������7KHVH�$IULFDQV��ERUQ�ZLWKLQ�WKH�UHJLRQ�RI�.HQ\D��8JDQGD��7DQ]DQLD�DQG�(WKLRSLD�>LQFOXGLQJ�6RPDOLD��DQFLHQW�3XQW�@��WKHQ�WUDYHOHG�DORQJ�D�QRUWK�VRXWK�D[LV���7KH\�GHYHORSHG�WKH�IRXQGDWLRQV�RI�ZKDW�ZRXOG�ODWHU�EHFRPH�FLYLOL]DWLRQV�IURP�$]DQLD�LQ�WKH�VRXWK��WR�.HPHW�LQ�WKH�QRUWK���6RPH�YHQWXUHG�WR�:HVW�$IULFD���,W�LV�FOHDU�WKDW�DQ\�KXPDQ�ERUQ�WKDW�KDG�LWV�ELUWK�LQ�WKLV�UHJLRQ�ZRXOG�QRW�KDYH�VXUYLYHG�ZLWKRXW�SLJPHQWDWLRQ���1DWXUH�GRHV�QRW�GR�DQ\WKLQJ�E\�FKDQFH���,W�LV�IRU�WKDW�UHDVRQ�WKDW�KXPDQLW\�RI�WKH�VXE�HTXDWRULDO�UHJLRQ�ZDV�JLYHQ�PHODQLQ�WR�SURWHFW�KHU�KLV�VNLQ���:H�NQRZ�VFLHQWLILFDOO\�WKDW�XOWUD�YLROHW�UD\V�RI�WKH�VXQ�ZRXOG�KDYH�GHVWUR\HG�WKH�KXPDQ�RUJDQLVP�LQ�WKH�HTXDWRULDO�UHJLRQV��LI�WKLV�RUJDQLVP�KDG�QRW�EHHQ�SURWHFWHG�E\�WKH�0HODQLQ�FRYHU���,W�LV�RQO\�DIWHU�$IULFDQ�PHQ�ZRPEHGPHQ�OHIW�WKH�FRQWLQHQW�RI�$IULFD�WR�SHRSOH�RWKHU�SDUWV�RI�WKH�QRUWKHUQ�ODQGV��ZKLFK�KDG�D�GLIIHUHQW��DQG�ODWHU��GUDPDWLF�FOLPDWH��WKDW�PHQ�ZRPEHGPHQ�FKDQJHG���7KH\�KDG�D�GLIIHUHQW�ORRN��WKH\�ORVW�WKHLU�SLJPHQWDWLRQ���7KH�SHRSOHV�RI�$IULFD�GLG�QRW�OHDYH�EHFDXVH�WKH\�ZHUH�WU\LQJ�WR�IOHH�WKH�HIIHFWV�RI�WKH�VXQ���'XULQJ�WKHVH�WLPHV��WKH�VXQ�ZDV�D�EOHVVLQJ���7KH�UHJLRQ�RI�WKH�*UHDW�/DNHV�ZDV�DQ�HDUWKO\�SDUDGLVH��IRRG�ZDV�LQ�DEXQGDQFH�WKHUH������:KHQ�ZH�VWXG\�WKH�ZD\V�LQ�ZKLFK�WKHVH�HDUO\�KXPDQV�WUDYHOHG��ZH�VHH�WKDW�LI�DIWHU�HYHU\����\HDUV��DW�WKH�EHJLQQLQJ�RI�D�JHQHUDWLRQ��$IULFDQV�PRYHG����NLORPHWHUV��ORRNLQJ�LQ�RQH�GLUHFWLRQ�RU�DQRWKHU�IRU�QRXULVKPHQW��DW�WKH�HQG�RI��������\HDUV�WKHVH�VPDOO�PRYHPHQWV�����NP�SHU�JHQHUDWLRQ�IRU��������\HDUV��ZRXOG�WDNH�WKLV�$IULFDQ�DV�IDU�DV�&KLQD�LQ�WKH�)DU�(DVW���,W�LV�RQO\����NP�DFURVV�WKH�ZDWHU�IURP�*LEUDOWDU�WR�(XURSH���,Q�XQGHUVWDQGLQJ�WKH�SUHYLRXV�LQIRUPDWLRQ��ILYH�IDFWRUV�VKRXOG�EH�KLJKOLJKWHG����+RZ�$IULFD�ZDV�SHRSOH���+RZ�WKH�ILUVW�KXPDQV�LQ�$IULFD�FRQIURQWHG�1DWXUH���+RZ�WKH\�WRRO�RQ�WKH�FKDOOHQJH�RI�QDWXUH�WR�FUHDWH�FLYLOL]DWLRQV���+RZ�WKHVH�FLYLOL]DWLRQV�VSUHDG�DFURVV�$IULFD�DQG�HYHQWXDOO\�WR�RWKHU�SDUWV�RI�WKH�ZRUOG���+RZ�GLG�$IULFDQV�SHRSOH�WKH�ZRUOG"�����7KH�.HPHWLF�+DSL�GHULYHV�LWV�ZDWHUV�DOPRVW�H[FOXVLYHO\�IURP�WKH�UDLQV�ZKLFK�IDOO�RYHU�WZR�HOHYDWHG�DUHDV��WKH�(TXDWRULDO�SODWHDX�RI�&HQWUDO�$IULFD�DQG�WKH�(WKLRSLDQ�SODWHDX���7KH�UDLQIDOO�RYHU�WKH�WZR�PDLQ�UHJLRQV�IROORZV�WKH�VXQ��FRPLQJ�EURDGO\�VSHDNLQJ�WR�D�

���

PD[LPXP��DIWHU�WKH�VXQ�LV�LQ�LWV�]HQLWK�DQG�IDOOLQJ�DZD\�DV�LW�UHFHGHV���&RQVHTXHQWO\��WKHUH�DUH�WZR�ZHW�VHDVRQV�RYHU�WKH�(TXDWRULDO�SODWHDX�WKDW�FRUUHVSRQG�FORVHO\�ZLWK�WKH�WZR�HTXLQR[HV��DOWKRXJK�RI�WKH�WZR��WKH�VSULQJ�UDLQV�DUH�WKH�PRUH�SURQRXQFHG��ZKLOH�WKH�VXPPHU�VROVWLFH�VHWV�WKH�VXQ�DW�LWV�]HQLWK�LQ�WKH�QRUWKHUQ�+HPLVSKHUH���7KH�ODUJHVW�TXDQWLW\�RI�+DSL�ZDWHUV�LV�FRQWULEXWHG�E\�%OXH�+DSL��DQG�WKH�VPDOOHVW�DPRXQW�E\�WKH�$WEDUD���'XULQJ�WKH�ORZ�WLPH�RI�WKH�\HDU��)HE�-XQ��%OXH�+DSL�LV�WKH�PRUH�LPSRUWDQW�VRXUFH�RI�OLIH���7KH�$WEDUD�GRHV�QRW�FRQWULEXWH�ZDWHU�IURP�-DQ�-XQ���2Q�WKH�DYHUDJH������RI�WKH�ZDWHU�RI�+DSL�FRPHV�IURP�(WKLRSLD�DQG�����IURP�WKH�/DNH�3ODWHDX�RI�&HQWUDO�$IULFD���7KH�(TXDWRULDO�3ODWHDX�FRQWULEXWHV�D�VPDOO��EXW��UHJXODU�DPRXQW�WR�+DSL�LQ�.HPHW��DQG�LI�WKLV�VRXUFH�ZHUH�WR�EH�FXW�RII�LW�FDQ�KDUGO\�EH�GRXEWHG��XQOHVV�QHZ�VRXUFHV�FDPH�LQWR�RSHUDWLRQ��+DSL�ZRXOG�UXQ�GU\�LQ�WKH�VSULQJ�PRQWKV���7KH�UDLQIDOO�RI�WKH�(WKLRSLDQ�+LJKODQGV�RQ�WKH�RWKHU�KDQG��SURGXFHV�WKH�UHJXODU�IORRG�HIIHFW�RQ�ZKLFK��XQWLO�UHFHQW�WLPHV��WKH�ZKROH�DJULFXOWXUDO�V\VWHP�RI�WKH�FRXQWU\�GHSHQGHG���)XUWKHUPRUH��WKH�ULFK�GHSRVLWV�RI�VLOW��EURXJKW�GRZQ�HYHU\�\HDU�IURP�WKH�GLVLQWHJUDWLRQ�RI�WKH�KLOO��PRXQWDLQ��.LOLPDQMDUR��3WDK��ZHUH�ERWK�WKH�DUFKLWHFW�DQG�IHUWLOL]HU�RI�WKH�+DSL�IORRGSODLQ�ZKLFK�PDNHV�.HPHW�D�KDELWDEOH�FRXQWU\������3UHVHQWO\��+DSL�GLVFKDUJHV�DERXW����PLOOLRQ�FXELF�PHWHUV�RI�ZDWHU�D�\HDU�LQWR�WKH�0HGLWHUUDQHDQ�������RI�WKH�ZDWHU�VXSSO\�RI�.HPHW�LV�VXSSOLHG�E\�+DSL���2QH�RI�WKH�WULEXWDULHV�RI�+DSL�LV�:KLWH�+DSL��RULJLQDWLQJ�LQ�(TXDWRULDO�$IULFD��LQ�WKH�6XGG�UHJLRQ�ZKHUH�WKH�%DKU�HO�*KD]DO��EULQJLQJ�ZDWHU�IURP�+DSL�&RQJR�GLYLGH�DQG�WKH�6REDW�EULQJLQJ�ZDWHU�IURP�WKH�(WKLRSLDQ�+LJKODQGV�MRLQ�WKH�QRUWKHUQ�SDUW�RI�WKH�6XGG��D�UHJLRQ�RI�VZDPSV�DQG�PDUVKHV��WKURXJK�ZKLFK�+DSL�SDVVHV���,W�KDV�LWV�RULJLQV�LQ�WKH�*UHDW�/DNHV�UHJLRQ���,W�FRQWLQXHV�WR�WKH�QRUWKHUQ�UHJLRQ�RI�WKH�6XGG��%DKU�HO�*HEHO���,Q�µ6XGDQ��1XELD���:KLWH�+DSL�LV�MRLQHG�E\�%OXH�+DSL���7KLV�SRZHUIXO�WULEXWDU\�ZKLFK�FRPHV�IURP�WKH�(WKLRSLDQ�+LJKODQGV�FRQVWLWXWHV�WKH�SULQFLSOH�VRXUFH�RI�WKH�ZDWHUV��FDXVH�WKH�DQQXDO�ULVH�DQG�IDOO�LQ�WKH�OHYHO�RI�WKH�ULYHU�GRZQVWUHDP�RI�WKH�MXQFWLRQ������(J\SW�LV�WKH�JLIW�RI�+DSL��1LOH�5LYHU����7KLV�VHDW�RI�DQFLHQW�FXOWXUH�LV�VL[�KXQGUHG�PLOHV�ORQJ��DQG�LV�KHPPHG�LQ�E\�WZR�UDQJHV�RI�EDUUHQ�OLPHVWRQH�KLOOV��ZKLFK�DOWHUQDWHO\�DSSURDFK�DQG�UHWUHDW�IURP�HDFK�RWKHU��PDLQWDLQLQJ�EHWZHHQ�WKHP�DQ�DYHUDJH�EUHDGWK�RI�VHYHQ�PLOHV���,Q�WKH�QRUWK��WKH\�VSUHDG�RXW�DQG�ILQDOO\�GLVDSSHDU��JLYLQJ�ZD\�WR�D�PDUVK�OLNH�SODLQ�ZKLFK�H[WHQGV�WR�WKH�0HGLWHUUDQHDQ�6HD������$V�ZH�JR�VRXWKZDUG��XS�+DSL���WKH�OLPHVWRQH�KLOOV�DUH�UHSODFHG�E\�WKRVH�RI�JUDQLWH��DQG�WKHVH�KLOOV�ILQDOO\�DSSURDFK�HDFK�RWKHU�XQWLO�WKH\�DOPRVW�WRXFK���7KURXJK�WKLV�JRUJH��WKH�ULYHU��GXULQJ�WKH�VHDVRQ�RI�LQXQGDWLRQ��UXVKHV�LQWR�WKH�YDOOH\�DQG�UXQV�QRUWKZDUG�WR�WKH�VHD���,Q�WKH�ZLQWHU�DQG�VSULQJ��WKH�ULYHU�UROOV�DORQJ�VOXJJLVKO\�WKURXJK�D�GU\�DQG�GXVW\�SODLQ��EXW��LW�WKH�VXPPHU�DOO�WKLV�FKDQJHV��E\�WKHQ�WKH�ZDWHUV�EHJLQ�WR�PRYH�VZLIWO\���+DSL�ILUVW�WXUQV�UHG�LQ�FRORU��ODWHU�LW�ODNHV�D�JUHHQ�KXH��DQG�HYHQWXDOO\�LW�RYHUIORZV�LWV�EDQNV�DQG�IORRGV�WKH�YDOOH\�WR�WKH�EDVHV�RI�WKH�KLOOV���7KH�ZKROH�YDOOH\�EHFRPHV�D�KXJH�ODNH�IURP�ZKLFK�WKH�YLOODJHV�ULVH�OLNH�LVODQGV��EHLQJ�LQ�IDFW��EXLOW�RQ�DUWLILFLDO�PRXQGV������7KH�VRXUFHV�RI�+DSL�DUH�WZR�JUHDW�ODNHV�ORFDWHG�GHHS�LQ�WKH�KHDUW�RI�$IULFD��/DNH�0ZDQ]D��9LFWRULD��DQG�1\DQ]D��5XGROSK����$V�WKH�FORXGV�ODGHQ�ZLWK�PRLVWXUH�SDVV�RYHU�(TXDWRULDO�$IULFD��WKH\�UHOHDVH�WKHLU�ZDWHUV���7KLV�UHVXOWV�LQ�D�UDLQ\�VHDVRQ�RI�WHQ�PRQWK¶V�GXUDWLRQ���7KH�GHOXJH�ILQGV�LWV�ZD\�LQWR�WKH�JUHDW�ODNHV��DQG�WKH\�GLVFKDUJH�WKHLU�H[FHVV�ZDWHUV��ZKLFK�IORZ�QRUWKZDUG�DV�+DSL���$V�WKLV�VWUHDP�IORZV�WKURXJK�D�WKLUVW\�ODQG��WKH�SDUFKHG�VRLO�GULQNV�LW�XS��EXW��WKH�ZDWHUV�FRQWLQXH�WR�IORZ�IRUWK��DQG�VR�SXVK�WKH�ULYHU�DFURVV�D�JUHDW�GHVHUW�VWUHWFKLQJ�IURP�WKH�ODWLWXGH�RI�/DNH�&KDG�WR�WKH�0HGLWHUUDQHDQ�6HD�

���

�����+DSL�RZHV�LWV�H[LVWHQFH�WR�WKH�*UHDW�/DNHV��EXW��WKH�LQXQGDWLRQ�LV�SURGXFHG�E\�D�VHSDUDWH�FDXVH��LQ�ZKLFK�WKH�ODNHV�GR�QRW�SDUWLFLSDWH���,Q�EHWZHHQ�+DSL�DQG�WKH�PRXWK�RI�WKH�$UDELDQ�*XOI�DUH�WKH�+LJKODQGV�RI�(WKLRSLD��ZKLFK�ULVH�WRZDUG�WKH�KHDYHQV�WKRXVDQGV�RI�IHHW�DERYH�VHD�OHYHO���&ORXGV�IORDWLQJ�LQ�IURP�DERYH�WKH�,QGLDQ�2FHDQ�DUH�LQWHUFHSWHG�E\�WKHVH�PRXQWDLQV�DV�WKH\�WUDYHO�QRUWKZDUG���7KH�FORXGV�UHOHDVH�WKLV�EXUGHQ�RI�PRLVWXUH��DQG�GXULQJ�WKH�UDLQ\�VHDVRQ��WKHVH�ULYHUV�UXVK�WKURXJK�WKHLU�DULG�EHGV�DQG�URDU�LQWR�+DSL���7KH�JUHDW�ULYHU�PRYHV�QRUWKZDUG�EHWZHHQ�URFN\�ZDOOV�DV�LW�WUDYHUVHV�WKH�1XELDQ�'HVHUW��DQG�ZKHQ�WKH�ORZODQGV�RI�.HPHW�DUH�UHDFKHG��LW�RYHUIORZV�LWV�EDQNV���7KH�WZR�(WKLRSLDQ�WULEXWDULHV�PDNH�UHVSHFWLYHO\�LPSRUWDQW�DQG�XQLTXH�FRQWULEXWLRQV���7KH�ZDWHUV�RI�:KLWH�+DSL�DUH�FU\VWDO�FOHDU��EXW��WKH�$WEDUD�DQG�%OXH�+DSL�V\VWHPV�EULQJ�DORQJ�ULFK�EODFN�VLOW�IURP�WKH�$E\VVLQLDQ�+LJKODQGV���7KLV�VHGLPHQW�ILQDOO\�VHWWOHV�RYHU�WKH�ODQG�RI�.HPHW�DV�ULFK�WRSVRLO���:KHQ�WKH�ZDWHUV�UHFHGH��WKH�IDUPHUV�VFDWWHU�WKHLU�VHHGV�RYHU�WKH�IHUWLOH�ODQG�DQG�WKHQ�ZDLW�IRU�WKH�VRODU�HQHUJ\�WR�EULQJ�IRUWK�WKHLU�FURSV���%XW��IRU�ZKLWH�+DSL��WKH�ULYHUV�RI�(WKLRSLD�ZRXOG�EH�DEVRUEHG�E\�WKH�WKLUVW\�GHVHUW��DQG�ZLWKRXW�WKH�(WKLRSLD�ZDWHUV��WKH�:KLWH�+DSL�ZRXOG�EH�D�EDUUHQ�ZDWHU�FRXUVH���7KH�ULYHU�LV�JHQHUDWHG�E\�WKH�(TXDWRULDO�UDLQV���7KH�ODQG��RQ�WKH�RWKHU�KDQG��LV�SURGXFHG�E\�WKH�SUHFLSLWDWLRQ�RI�WKH�WURSLFDO�UDLQV�RQ�WKH�VORSHV�RI�WKH�(WKLRSLDQ�PRXQWDLQ�SLOH��,Q�WKDW�+DSL�YDOOH\�IDWWHQHG�E\�D�WRS�VRLO��EULJKWHQHG�E\�HWHUQDO�VXQVKLQH��ZDWHUHG�E\�WHUUHVWULDO�UDLQV��WKH�SHRSOH�ZHUH�DEOH�WR�REWDLQ�D�\HDU¶V�IRRG�LQ�UHWXUQ�IRU�D�IHZ�GD\V¶�WRLO���,Q�HIIHFW��WKH\�HUH�SURYLGHG�ZLWK�D�ZHDOWK�RI�WLPH�ZKLFK�ZDV�HVVHQWLDO�IRU�WKH�FRQVWUXFWLRQ�RI�WKHLU�QDWLRQ¶V�JURZWK���7KLV�JURZWK�ZRXOG�OHDG�WR�$IULFDQ�SHRSOLQJ�QRW�RQO\�WKHLU�FRQWLQHQW��EXW�DOVR�WKH�UHVW�RI�WKH�ZRUOG��7KH�)LUVW�0LJUDWLRQ������7KH�ILUVW�PLJUDWLRQV�PRYHG�DORQJ�WURSLFDO�ODWLWXGHV�HQDEOLQJ�$IULFDQV�WR�LQKDELW�,QGLD��6RXWKHDVW�$VLD�DQG�XOWLPDWHO\��$XVWUDOLD�DQG�WKH�3DFLILF�,VODQGV���$IULFDQV�FRXOG�KDYH�LQKDELWHG�(XUDVLD�E\�PLJUDWLRQV�WKURXJK�WKH�6WUDLWV�RI�*LEUDOWDU�WKH�,VWKPXV�RI�6XH]�DQG�SHUKDSV�6LFLO\���$IULFDQV�VXUYLYHG�HYHU\ZKHUH�LQ�(XURSH�LQ�(XURSH�DQG�$VLD�XQWLO�WKH�1HROLWKLF�3HULRG���7KHLU�UHPDLQV�FDQ�EH�IRXQG�LQ�6SDLQ��3RUWXJDO��%HOJLXP��WKH�%DONDQV��6ORYDNLD��1RUWKHUQ�5XPDQLD��3RODQG��0RUDYLD��$XVWULD��6LEHULD��&KLQD��(DVWHUQ�(XURSH��WKH�1HDU�(DVW��&ULPHD��*ULPDOGL�DQG�-DYD�������7KHUH�ZDV�DQ�HDUO\�PLJUDWLRQ�WR�(XURSH�DQG�$VLD�E\�WKH�$IULFDQ�*ULPDOGL�0DQ�:RPEHGPDQ�DQG�WKH�$XULJQDFLDQ�LQGXVWU\�RI�SDLQWLQJ��RWKHU�PDWHULDOV�FDQ�EH�UDGLR�FDUERQ�GDWHG�IRU�DQ�DEVROXWH�FKURQRORJ\���(XURSH�GLG�QRW�VHH�WKH�ELUWK�RI�+RPR�6DSLHQV�6DSLHQV�XQWLO�WKH�$IULFDQ�DSSHDUHG�E\�PLJUDWLRQ���7KH�ILUVW�VR�FDOOHG��³ZKLWH�SHRSOH�´�WKH�³&UR�0DJQRQ�´�KXPDQ�GLG�QRW�DSSHDU�XQWLO�DURXQG��������\HDUV�DJR��SUREDEO\�DV�D�UHVXOW�RI�WKH�SK\VLFDO�WUDQVIRUPDWLRQ�E\�DGDSWDWLRQ�WR�WKH�FROG�HQYLURQPHQW���7KLV�UDFLDO�GLIIHUHQWLDWLRQ�ZDV�DFKLHYHG�LQ�(XURSH��SUREDEO\�LQ�VRXWKHUQ�)UDQFH�DQG�LQ�6SDLQ��DW�WKH�HQG�RI�WKH�ODVW�:XUPLDQ�*ODFLDWLRQV�EHWZHHQ��������DQG��������\HDUV�DJR������7KHUH�LV�DEVROXWHO\�QR�GRXEW�WKDW�WKH�ZKLWH�UDFH�ZKLFK�DSSHDUHG�IRU�WKH�ILUVW�WLPH�GXULQJ�WKH�8SSHU�3DOHROLWKLF�SHULRG�DURXQG��������\HDUV�DJR�ZDV�WKH�SURGXFW�RI�D�SURFHVV�RI�GHSLJPHQWDWLRQ���7KLV�GDWH�FRXOG�EH�PXFK�HDUOLHU��DERXW��������\HDUV�DJR��2I�FRXUVH��LW�ZRXOG�EH�GLIILFXOW�LW�QRW�LPSRVVLEOH��WR�SURYLGH�H[DFW�GDWD�RQ�WKH�QXPHULFDO�SURSRUWLRQ�RI�WKHVH�SURWR�ZKLWHV�WR�WKHLU�EODFN�DQFHVWRUV�DW�WKDW�SHULRG�LQ�(XURSH���+RZHYHU��WKHUH�FDQ�EH�QR�GRXEW�WKDW�WKH�FXOWXUDO�RXWORRN�RI�WKHVH�SURWR�ZKLWHV�ZDV�HYHQWXDOO\�

���

FRQGLWLRQHG�GXULQJ�WKH�JODFLDO�HSRFK�E\�WKH�H[WUHPHO\�KDUVK�FRQGLWLRQV�RI��WKHLU�1RUWKHUQ�FUDGOH��XQWLO�WKH�PRPHQW�RI�WKHLU�PLJUDWRU\�PRYHPHQWV�WRZDUGV�WKH�VRXWKHUQ�DUHDV�DURXQG������\HDUV�EHIRUH�WKH�&KULVWLDQ�HUD������7KH�$IULFDQV�RI�*ULPDOGL�OHIW�WKHLU�FRXQWOHVV�WUDFHV�RQ�WKH�ZKROH�DUHD�RI�(XURSH�DQG�$VLD��IURP�WKH�,EHULDQ�3HQLQVXOD�WR�/DNH�%DLNDO�LQ�6LEHULD��SDVVLQJ�WKURXJK�)UDQFH��$XVWULD��&ULPHD��DQG�WKH�'RQ�5LYHU�%DVLQ���,Q�WKHVH�WZR�ODVW�UHJLRQV��WKH�ODWH�6RYLHW�SURIHVVRU��'U��*XHUDVVLPRY��D�VFKRODU�ZLWK�D�UDUH�REMHFWLYLW\��LGHQWLILHG�WKH�$IULFDQ�W\SH�RI�VNXOO�IRXQG�LQ�WKH�PLGGOH�0RXVWHULDQ�SHULRG���%XW��WR�WUXO\�XQGHUVWDQG�ZKR�WKHVH�*ULPDOGLV�ZHUH��OHW�XV�ORRN�DW�WKH�ZRUN�GRQH�E\�3URIHVVRU�:LOOLDP�/HR�+DQVEHUU\�RI�+RZDUG�8QLYHUVLW\���3OHDVH�NHHS�LQ�PLQG�WKDW�WKLV�ZRUN�ZDV�GRQH�VRPHZKHUH�EHWZHHQ������DQG������������3URIHVVRU�+DQVEHUU\�EHOLHYHG�WKDW�FODVVLI\LQJ�KXPDQ�EHLQJV�LQWR�UDFHV�ZDV�DUELWUDU\�DQG�DUWLILFLDO���,Q�KLV�UHVHDUFK��KH�IRXQG�PDQ\�HWKQRORJLVWV�GLIIHULQJ�LQ�WKH�QXPEHU�RI�UDFHV���+H�FLWHG�&XYHLU�DQG�4XDWUHIDJH�DV�OLVWLQJ����%OXHPEDFK�KDG����%XIIRQ����3ULFKDUG��+XQWHU�DQG�3HVFKHO����$JDVVL]����'HVPRXOLQV�DQG�3LFNHULQJ�����+DHFNHO�����%RU\�6W��9LQFHQW�����0DWK�%UXQ�����7RSLQDUG�����0RUWRQ�����&UDZIRUG����DQG�*OLGGRQ�DQ�XQEHOLHYDEOH�����GLIIHUHQW�UDFHV�ZLWKLQ�WKH�KXPDQ�UDFH���+DQVEHUU\�VDLG�WKDW�ZLWK�VXFK�GLIIHUHQW�ILQGLQJV��WKHUH�ZDV�QR�ZD\�WR�GHWHUPLQH�KRZ�PDQ\�UDFHV�RI�KXPDQ�EHLQJV�H[LVWHG���+H�ZHQW�RQ�WR�VWDWH�WKDW�WKHUH�ZDV�RQO\�RQH�UDFH�ZLWK�PDQ\�GLIIHUHQW�FRPSOH[LRQV���+H�VDLG�WKLV�RULJLQDO�UDFH�KDG�LWV�EHJLQQLQJV�LQ�$IULFD�DQG�ZHUH�LQ�IDFW��$IULFDQV������,Q�VHHNLQJ�WR�VXEVWDQWLDWH�KLV�WKHRU\��+DQVEHUU\�PDFH�H[WHQVLYH�XVH�RI�WKH�ILQGLQJV�RI�JHRORJLVWV�FLWLQJ�WKH�FOLPDWLF�FKDQJHV�GXULQJ�WKH�2OG�6WRQH�$JH���+DQVEHUU\�IRXQG�WKDW�WKH�JODFLDO�DQG�LQWHUJODFLDO�SHULRGV�RI�WKH�:XUP�JODFLDWLRQ�KDG�D�SURIRXQG�HIIHFW�RQ�+XPDQNLQG�GXULQJ�WKH�3OHLVWRFHQH�SHULRG������7KH�GUDPDWLF�FKDQJHV�LQ�FOLPDWH�LQ�$IULFD��$VLD�DQG�(XURSH�DFFHOHUDWHG�WKH�WHQGHQFLHV�WRZDUGV�SK\VLFDO�GLIIHUHQWLDWLRQ�DQG�WKH�FUHDWLRQ�RI�GLIIHULQJ�HWKQLF�JURXSV���+DQVEHUU\�WKHRUL]HG�WKDW�WKH�RQO\�SHRSOH�LQGLJHQRXV�WR�WKHLU�ODQG�ZHUH�&HQWUDO�(DVW�$IULFDQV�ZKR�PLJUDWHG�WR�RWKHU�SDUWV�RI�WKH�ZRUOG�ZLWK�YDULRXV�FOLPDWHV���7KHVH�FROGHU�FOLPDWHV�DIIHFWHG�WKHLU�ERG\¶V�PHODQLQ�FRQWHQW�DQG�FUHDWHG�D�OLJKWHU�FRPSOH[LRQ�UHVXOWLQJ�LQ�WKH�$VLDQ�DQG�&DXF$VLDQ�HWKQLF�VWRFNV������3URIHVVRU�+DQVEHUU\�GLVFXVVHG�KLV�WKHRU\�IXUWKHU�E\�H[DPLQLQJ�WKH�GLVFRYHU\�RI�WKH�(XURSHDQ�&UR�0DJQRQ�UDFH�WKDW�ZDV�ILUVW�EURXJKW�WR�OLJKW�LQ������LQ�D�)UHQFK�YLOODJH�FDOOHG�/HV�(\VLHV������'XULQJ�WKH�FRQVWUXFWLRQ�RI�D�UDLOURDG�IURP�$JHQ�WR�3HULJXHX[��D�KXPDQ�VNHOHWRQ�ZDV�XQHDUWKHG�LQ�D�URFN�VKHOWHU�WKDW�WKH�ORFDO�LQKDELWDQWV�FDOOHG�&UR�0DJQRQ���7KH�GLJJLQJ�ZDV�VWRSSHG�DQG�D�JHRORJLVW��'U��/DJDQQH�ZDV�FDOOHG�LQ�IRU�KLV�RSLQLRQ���'U��/DJDQQH�UHSRUWHG�KLV�ILQGLQJV�WR�DQ�DUFKHRORJLVW��0U��/RXLV�/DUWHW���7RJHWKHU�WKH\�XQFRYHUHG�UHPDLQV�RI�ILYH�LQGLYLGXDOV�ZKR�VHHPHG�WR�KDYH�EHHQ�PXUGHUHG�DOO�DW�RQFH���7KHLU�ERGLHV�ZHUH�OHIW�ZKHUH�WKH\�KDG�IDOOHQ���7KH�VFLHQWLVWV�IRXQG�WKH�IROORZLQJ����$�VNHOHWRQ�RI�D�KHDOWK\�ROG�PDQ���6NXOO�IUDJPHQWV�RI�DQRWKHU�ROG�PDQ���$Q�LQFRPSOHWH�VNHOHWRQ�RI�D�PDQ�DEXW����\HDUV�ROG���$�VNXOO�DQG�IUDJPHQWHG�VNHOHWRQ�RI�D�PLGGOH�DJHG�ZRPDQ���$�IUDJPHQWHG�VNXOO�RI�DQ�XQERUQ�FKLOG

���

�����,Q�FORVH�SUR[LPLW\��VWRQH�LPSOHPHQWV�ZHUH�GLVFRYHUHG�WKDW�ZHUH�DVVLJQHG�WR�WKH�8SSHU�/DWH�$XULJQDFLDQ�VWDJH���$OO�ILYH�PHPEHUV�ZHUH�VDLG�WR�KDYH�EHORQJHG�WR�WKH�VDPH�IDPLO\���7KHVH�LQGLYLGXDOV��ZKR�ZHUH�QDPHG�&UR�0DJQRQ��H[KLELWHG�D�FRPELQDWLRQ�RI�$IULFDQ�DQG�&DXF$VLDQ�SK\VLFDO�WUDLWV�����������0RUH�KXPDQ�UHPDLQV�ZHUH�IRXQG�DW�*ULPDOGL��ORFDWHG�RQ�WKH�VHDFRDVW�QHDU�WKH�,WDOLDQ�DQG�)UHQFK�ERUGHU���1LQH�FDYHV��URFN�VKHOWHUV��ZHUH�IRXQG�DW�WKLV�VLWH�QDPHG��³*URWWH�'H�*ULPDOGL�´��7KHVH�ILQGV�ZHUH�VR�LPSUHVVLYH�WKDW�LQ�������3ULQFH�$OEHUW�,�RI�0RQDFR�ILQDQFHG�DQG�VXSHUYLVHG�WKH�H[FDYDWLRQV�DW�WKLV�VLWH���+H�LQYLWHG�WKH�OHDGLQJ�(XURSHDQ�VFLHQWLVWV�WR�SDUWLFLSDWH�LQ�WKHVH�H[FDYDWLRQV���&DQRQ�GH�9LOOHQHXYH�ZDV�DVVLVWHG�E\�0��/RUHQ]L���3URIHVVRU�0DUFHOOLQ�%RXOH�RI�3DULV�ZDV�WR�DSSUDLVH�DQG�UHSRUW�WKH�ILQGLQJV�RQ�WKH�JHRORJLFDO�DQG�SDOHRQWRORJLFDO�HYLGHQFH�DQG�0��(PLOH�&DUWDLOKDF�ZDV�KLUHG�WR�GHVFULEH�WKH�ILQGLQJV���7KH�UHSRUW�ZDV�WR�EH�JLYHQ�WR�WKH�SK\VLFDO�DQWKURSRORJLVW�'U��5��9HUQHDX���7KH�HQWLUH�SURMHFW�ZDV�FRPSOHWHG�LQ��������7KH�UHVXOWV�ZHUH�SXEOLVKHG�DW�3ULQFH�$OEHUW¶V�H[SHQVH�LQ��������7KH�IROORZLQJ�ZHUH�WKH�UHSRUWV�SXEOLVKHG�����������������������������������/HV�*URWHV�GH�*ULPDOGL�±�%DRXVVH�5RXVVH����������������������������������+LVWRULTXH�HW�'HVFULSWLRQ�±�/��GH�9LOOHQHXYH����������������������������������*HRORJLH�HW�3DOHQWRORJLH�±�0��%RXOH����������������������������������$QWKURSRORJLH�±�5��9HUQHDX����������������������������������$UFKDHRORJLH�±�(��&DUWDLOKDF�����$ORQJ�ZLWK�RWKHU�VNHOHWRQV�GDWLQJ�EDFN�WR�WKH�2OG�6WRQH�$JH��QHZ�LQIRUPDWLRQ�ZDV�GLVFRYHUHG�UHODWLQJ�WR�WKH�FOLPDWLF�KLVWRU\�RI�6RXWKHUQ�(XURSH�DQG�WKH�DQLPDOV�OLYLQJ�LQ�WKDW�SDUW�RI�WKH�ZRUOG�GXULQJ�WKDW�SHULRG������7KH�&UR�0DJQRQ�VSHFLHV�RI�+RPR�6DSLHQV�ZDV�WKRXJKW�WR�EH�WKH�ILUVW�HYLGHQFH�RI�PRGHUQ�PDQ�LQ�(XURSH���7KLV�$XULJQDFLDQ�W\SH�FXOWXUH�ZDV�GLVWLQJXLVKHG�E\�LWV�HPSKDVLV�RQ�DUW��1DVVD�VKHOOV��W\SH�RI�EXULDO��HWF�����+RZHYHU��LQ�WKH�FXUVH�RI�WKH�H[FDYDWLRQV��HYLGHQFH�ZDV�EURXJKW�WR�OLJKW�LQIHUULQJ�WKDW�&UR�0DJQRQ�ZDV�SUHFHGHG�LQ�(XURSH�E\�D�PRUH�$IULFDQ�W\SH�JURXS�NQRZQ�DV�*ULPDOGL���3URIHVVRU�+DQVEHUU\�EHOLHYHG�WKDW�WKH�*ULPDOGL�EURXJKW�WKH�$XULJQDFLDQ�W\SH�FXOWXUH�WR�(XURSH������:KHQ�&DQRQ�GH�9LOOHQHXYH�DQG�/RUHQ]L�ILUVW�DUULYHG�DW�WKH�*ULPDOGL�FDYHV�LQ�������WKH\�GLVFRYHUHG�WKDW�WKH�GHSRVLWV�LQ�WKH�ODUJHVW�URFN�VKHOWHU��³*URWWHV�GX�3ULQFH�´�KDG�EHHQ�OHIW�XQWRXFKHG���7KH\�EHJDQ�WKHLU�H[FDYDWLRQ�WKHUH�E\�UHPRYLQJ�WKH�GHSRVLWV�IURP�WRS�WR�ERWWRP���7KH\�IRXQG�PDQ\�IRVVLO�ERQHV�EHORQJLQJ�WR�DQLPDOV��EXW�QR�KXPDQ�UHPDLQV���7KH�³*URWWHV�GHV�(QIDQWV�´�KDG�WKH�HYLGHQFH�RI�WKH�*ULPDOGL�SUHVHQFH�LQ�(XURSH������7KH�ILUVW�ZDV�RI�WZR�FKLOGUHQ�DSSUR[LPDWHO\�ILYH�WR�VL[�\HDUV�ROG���,Q�������WZR�)UHQFKPHQ��0��0��-XOLDQ�DQG�%RQILOV�IRXQG�VHYHQ�VNHOHWRQV�RQ�WKH�VDPH�OHYHO���,Q�������6LJQLRU�$EER�IRXQG�D�VHFRQG�VNHOHWRQ�DW�WKH�VDPH�GHSWK���6LJQRU�$EER�UHSRUWHG�KLV�ILQGV�WR�0��9HUQHDX�ZKR�VXEVHTXHQWO\�IRXQG�WZR�PRUH�VNHOHWRQV���9HUQHDX�WKHQ�IRXQG�WKUHH�VNHOHWRQV�QHDU�WKLV�VLWH������0��5LYLHUH�DOVR�H[FDYDWHG�DW�WKLV�GHSWK��EXW�KH�RQO\�ZHQW�DV�IDU�DV�WKH�ILUVW�OHYHO���9LOODQHXYH�ZHQW�WR�WKH�FDYH¶V�URFN�ERWWRP���+H�GLVWLQJXLVKHG�WZHOYH�PRUH�VWUDWLILHG�OD\HUV���7KH�ILUVW�OHYHO�ZDV�WKH�VNHOHWRQ�RI�WKH�FKLOGUHQ���2Q�WKH�VHFRQG�OHYHO��KH�IRXQG�ERQHV�RI�DQ�ROG�ZRPDQ���2Q�WKH�WKLUG��IRXUWK��ILIWK��VL[WK�DQG�VHYHQWK�OHYHO�KH�IRXQG�IRVVLO�UHPDLQV�RI�D�UHLQGHHU��KRUVH��ZLOG�ERDU��ZROI��IR[��ZLOG�DVV�DQG�FDYH�OLRQ���2Q�HYHU\�OHYHO�H[FHSW�WKH�ILIWK��ILUH�KHDUWKV�DQG�RWKHU�DUWLIDFWV�RI�$XULJQDFLDQ�LQIOXHQFH�VXJJHVWHG�KXPDQ�KDELWDWLRQ���2Q�WKH�HLJKWK�OHYHO�DQRWKHU�PDQ¶V�VNHOHWRQ�ZDV�IRXQG�ZLWK�QDVVD�VKHOOV�DQG�DQLPDO�WHHWK�DGRUQLQJ�KLV�KHDG�DQG�QHFN���2Q�WKH�QLQWK�OHYHO��9LOODQHXYH�IRXQG�WZR�ZHOO�

���

SUHVHUYHG�VNHOHWRQV���2QH�VNHOHWRQ�ZDV�D�ZRPDQ��WKH�RWKHU�ZDV�D�ER\�DERXW�VL[WHHQ�\HDUV�ROG���%RWK�ZHUH�EXULHG�ZLWK�WKHLU�OHJV�DQG�DUPV�WLJKWO\�IROGHG���3URIHVVRU�+DQVEHUU\�QRWHG�WKDW�WKLV�W\SH�RI�EXULDO�ZDV�H[WHQVLYHO\�SUDFWLFHG�LQ�WKH�/DWH�3DOHROLWKLF��1HROLWKLF��DQG�3URWR�+LVWRULF�SHULRGV�LQ�$IULFD��:HVWHUQ�DQG�6RXWKHUQ�(XURSH�DQG�6RXWKHUQ�DQG�6RXWKZHVWHUQ�$VLD������7KH�PRVW�LPSRUWDQW�DVSHFW�WR�WKLV�ILQG�ZDV�WKDW�WKH�ROG�ZRPDQ�DQG�ER\�GLIIHUHG�QRWLFHDEO\�IURP�WKH�RWKHU�VNHOHWRQV�IRXQG�LQ�WKH�KLJKHU�OHYHOV���7KHLU�SK\VLFDO�WUDLWV�ZHUH�QRW�D�PL[WXUH�RI�$IULFDQ�DQG�&DXFDVLDQ��OLNH�&UR�0DJQRQ��EXW�SUHGRPLQDQWO\�$IULFDQ���'U��9HUQHDX�SRLQWHG�WKLV�RXW�DW�WKH�7KLUWHHQWK�,QWHUQDWLRQDO�&RQJUHVV�RI�3UHKLVWRULF�$QWKURSRORJ\�DQG�$UFKHRORJ\�LQ�0RQDFR��LQ�$SULO�RI��������+H�VDLG�WKH\�ZHUH�VR�$IULFDQ�WKH\�EHORQJHG�LQ�D�VHSDUDWH�HWKQLF�JURXS���+H�QDPHG�WKHP��³/¶+RPPH�GH�*ULPDOGL�´�RU�WKH�*ULPDOGL�FXOWXUDO�JURXS������%HORZ�WKLV�QLQWK�OD\HU�PRUH�DQLPDO�UHPDLQV�VXFK�DV�WKH�UKLQRFHURV�ZDV�IRXQG���7KLV�DQLPDO�GLG�QRW�IORXULVK�LQ�(XURSH�DIWHU�WKH�0LG�3OHLVWRFHQH�$JH���,W�ZDV�WKHRUL]HG�WKDW�WKH�ORZHVW�GHSRVLWV�ZHUH�ODLG�GRZQ�WRZDUGV�WKH�HQG�RI�WKH�0LGGOH�3DOHROLWKLF�SHULRG�DQG�WKH�VXSHULQFXPEHQW�OD\HU�DQG�WZR�$IULFDQ�VNHOHWRQV�LQ�WKH�QLQWK�OHYHO�GDWHG�EDFN�WR�WKH�EHJLQQLQJ�RI�(XURSH¶V�XSSHU�3DOHROLWKLF�SHULRG������3ULRU�WR�WKLV�QR�RWKHU�KXPDQ�UHPDLQV�ZHUH�IRXQG�DQ\ZKHUH�LQ�(XURSH���7KLV�PDGH�LW�SRVVLEOH�WR�GDWH�WKHP�EDFN�WR�WKH�EHJLQQLQJ�RI�WKH�XSSHU�3DOHROLWKLF�DJH���7KLV�ZDV�D�WLPH�ZKHQ�WKH�$XULJQDFLDQ�FXOWXUH�ILUVW�DSSHDUHG�RQ�WKH�(XURSHDQ�FRQWLQHQW���$OO�RI�WKH�&UR�0DJQRQ�UHPDLQV�IRXQG�XS�WR�WKDW�GDWH�YHULILHG�WKDW�WKH�$XULJQDFLDQ�FXOWXUH�ZDV�DOUHDG\�ZLGHO\�HVWDEOLVKHG�LQ�(XURSH���7KH�WZR�*ULPDOGL�VNHOHWRQV�GDWHG�EDFN�WR�D�WLPH�ZKHQ�WKLV�FXOWXUH�ZDV�LQ�LWV�HDUOLHVW�VWDJHV��������3URIHVVRU�+DQVEHUU\¶V�WKHRU\�ZDV�WKDW�WKH�*ULPDOGL��$IULFDQ��ZDV�ROGHU�WKDQ�WKH�&UR�0DJQRQ��$IULFDQ�&DXFDVLDQ����+H�DOVR�EHOLHYHG�WKDW�WKH�*ULPDOGL�ZDV�WKH�ILUVW�WR�LQWURGXFH�WKH�$XULJQDFLDQ�FXOWXUH�WR�WKH�(XURSHDQ�FRQWLQHQW���+H�VDLG�WKDW�DV�$IULFDQV�PRYHG�LQWR�(XURSH��FOLPDWLF�FKDQJHV���:XUP�*ODFLDWLRQ��KDG�D�ELRORJLFDO�HIIHFW�RQ�WKHP��7KHLU�GDUN�SLJPHQWDWLRQ�HYROYHG�LQWR�D�OLJKWHU�FRPSOH[LRQ�UHVXOWLQJ�LQ�WKH�*ULPDOGL�EHFRPLQJ�WKH�&UR�0DJQRQ���7KH�PXWDWLRQ�RI�WKH�$IULFDQ�LQWR�WKH�&UR�0DJQRQ�GLG�QRW�WDNH�SODFH�LQ�D�GD\���7KHUH�ZDV�D�ORQJ�WUDQVLWLRQ�SHULRG�RI�PRUH�WKDQ��������\HDUV�FRUUHVSRQGLQJ�WR�WKH�DSSHDUDQFH�RI�VHYHUDO�LQWHUPHGLDU\�W\SHV�EHWZHHQ�WKH�$IULFDQ�DQG�(XUDVLDQ���+RZHYHU��&UR�0DJQRQ�GLG�QRW�FRPH�IURP�DQ\ZKHUH���6KH�+H�ZDV�WKH�SURGXFW�RI�WUDQVIRUPDWLRQ�RI�WKH�*ULPDOGLDQ�$IULFDQ�ZKHUH�KH�VKH�ZDV�IRXQG�DQG�QR�SUH�KLVWRULFDO�DUFKHRORJ\�KDV�SURYLGHG�DQ\�RWKHU�H[SODQDWLRQ�IRU�KHU�KLV�DSSHDUDQFH���$�JURXS�RI�WKHVH�&UR�0DJQRQV�SUREDEO\�PRYHG�WRZDUG�WKH�QRUWK��ZLWK�WKH�UHWUHDW�RI�WKH�FROG�DURXQG��������\HDUV�EHIRUH�WKH�&KULVWLDQ�HUD���7KLV�VWRFN�ZRXOG�JLYH�ELUWK�WR�WKH�6FDQGLQDYLDQ�DQG�*HUPDQLF�EUDQFK��VHH�$I�3U�,Q�(DUO\�(XURSH����$�ILUVW�JURXS�ZLOO�EHFRPH�VHSDUDWHG�IURP�WKLV�1RUGLF�EUDQFK�DW�DQ�XQGHWHUPLQHG�WLPH��EXW�FHUWDLQO\�ZHOO�DIWHU��������\HDUV�EHIRUH�WKH�&KULVWLDQ�HUD��%&(��DQG�ZLOO�RFFXS\�WKH�HDVWHUQ�SDUW�RI�(XURSH��WKHQ�ZLOO�GHVFHQG�WR�6F\WKLD��WR�WKH�FRQILQHV�RI�WKH�VRXWKHUQ�FUDGOH���2WKHU�EUDQFKHV�SUREDEO\�GHVFHQGHG�E\�PHDQV�RI�WKH�5KLQH�DQG�'DQXEH�WR�WKH�&DXFDVXV�DQG�LQWR�WKH�%ODFN�6HD��IURP�WKHUH��WKH�VHFRQGDU\�PLJUDWLRQV�RI�WKH�&HOWV�ZLOO�VHW�RXW��,EHULD�DQG�RWKHU�,QGR�(XURSHDQ�QDWLRQV���$URXQG�������%&(��WKH�*UHHNV�EHFDPH�VHSDUDWHG�IURP�WKH�1RUGLF�EUDQFK�DQG�LQ�D�QRUWK�VRXWK�PLJUDWLRQ�DUULYHG�LQ�*UHHFH��������

���

��7KH�/LIH�+LVWRU\�2I�7KH�&DXFDVRLG������7KH�OLIH�KLVWRU\�RI�WKH�&DXFDVRLG�RFFXUUHG�LQ�DQ�LFH�DJH�HQYLURQPHQW�QHDU�WKH�VRXWKHUQ�OLPLW�RI�WKH�JUHDW�OLQH�RI�(XUDVLDQ�JODFLHUV�LQ�DQ�DUHD�RI�VRXWKZHVWHUQ�5XVVLD�QHDU�WKH���VW�SDUDOOHO���7KLV�JODFLDO�OLQH�H[WHQGHG�WKURXJK�VRXWKHUQ�(QJODQG��QRUWKHUQ�*HUPDQ\��3RODQG�DQG�VRXWKHUQ�5XVVLD���:KLWH�VNLQ�ZDV�PRUH�IDYRUDEO\�DGDSWHG�WR�WKH�HFRORJLFDO�FRQGLWLRQV�RI�WKLV�UHJLRQ�GXULQJ�WKH�FULWLFDO�SHULRG���7KLV�SURWR�&DXFDVRLG�SRSXODWLRQ�H[SHULHQFHG�D�PRUH�RU�OHVV�SURORQJHG�SHULRG�RI�LVRODWLRQ�WKDW�HQDEOHG�LW�WR�GHYHORS�LQWR�D�GLVWLQFW�VXE�VSHFLHV�RU�HWKQLF�JURXS������)URP������PLOOLRQ�WR��������%&(��WKH�HDUWK�H[SHULHQFHG�D�SURORQJHG�SHULRG�RI�FRROLQJ�NQRZQ�DV�WKH�LFH�DJH���7KLV�LFH�DJH�ZDV�GLYLGHG�LQWR�IRXU�����JODFLDO�SHULRGV��HDFK�VHSDUDWHG�E\�IRXU�����ZDUP�³LQWHUJODFLDO�SHULRGV�´��'XULQJ�WKH�JODFLDO�SHULRGV��WKH�DPELHQW�WHPSHUDWXUHV�RI�WKH�HDUWK�GURSSHG�DQG�JUHDW�VKHHWV�RI�LFH��PRUH�WKDQ�D�PLOH�WKLFN��H[WHQGHG�GRZQ�IURP�WKH�$UWLF�WR�D�OLQH�URXJKO\�GHILQHG�E\�WKH���VW�SDUDOOHO���)RU�RXU�SXUSRVH�ZH�QHHG�RQO\�EH�FRQFHUQHG�ZLWK�WKH�:XUP�,�,QWHUVWDGLDO����������������\HDUV�DJR��LW�LV�EHOLHYHG�WKDW�&DXFDVRLG�KLVWRU\�ZDV�GHFLVLYHO\�DIIHFWHG�E\�WKH�LFH�DJH�HFRORJ\�RI�WKH�PLG�:XUPLDQ�SHULRG����������������\HDUV�DJR������+RPR�6DSLHQV�6DSLHQV�ILUVW�HPHUJHG�LQ�$IULFD�PRUH�WKDQ���������\HDUV�DJR��UHVHPEOLQJ�WKH�7ZD�DQG�6DQ�SRSXODWLRQV�RI�FHQWUDO�DQG�VRXWKHUQ�$IULFD��EXW�LW�LV�QRW�NQRZQ�DW�ZKDW�H[DFW�SHULRGV�VKH�KH�EHJDQ�WR�PLJUDWH�RXU�RI�$IULFD���7KH�ILUVW�DSSHDUDQFH�RI�+RPR�6DSLHQV�6DSLHQV�WKXV�FRLQFLGHG�ZLWK�WKH�ODWH�5LVV�JODFLDO�LQ�(XURSH�ZKLFK�HQGHG�DERXW���������\HDUV�DJR������2QH�RI�WKH�PRVW�YLWDO�IXQFWLRQV�RI�WKH�VNLQ�LV�WKH�SURGXFWLRQ�RI�9LWDPLQ�'�IURP�D�ELRFKHPLFDO�VXEVWDQFH�FDOOHG��³��'HK\GURFKROHVWURO´����'HK\GURFKROHVWURO�LV�D�ELRFKHPLFDO�VXEVWDQFH���,W�LV�D�]RRVWHURO���6WHUROV�RU�VWHURLG�DOFRKROV�DUH�D�VXEJURXS�RI�VWHURLGV���6WHUROV�RI�SODQWV�DUH�FDOOHG�SK\WRVWHUROV�DQG�VWHUROV�RI�DQLPDOV�DUH�FDOOHG�]RRVWHUROV���$Q�LPSRUWDQW�VWHURO�LV�³FKROHVWHUROV´���&KROHVWHURO�LV�D�OLSLG�IRXQG�LQ�WKH�FHOO�PHPEUDQHV�RI�DOO�DQLPDO�WLVVXHV��DQG�LV�WUDQVSRUWHG�LQ�WKH�EORRG�SODVPD�RI�DOO�DQLPDOV���&KROHVWHURO�LV�DOVR�D�VWHURO��D�FRPELQDWLRQ�VWHURLG�DQG�DOFRKRO����7KH�QDPH�RULJLQDWHV�IURP�WKH�*UHHN�FKROH ELOH�DQG�VWHUROV VROLG�DQG�WKH�FKHPLFDO�VXIIL[�RO DOFRKRO���������'HK\GURFKROHVWURO�IXQFWLRQV�LQ�WKH�VHUXP�DV�D�FKROHVWHURO�SUHFXUVRU��DQG�LV�FRQYHUWHG�WR�SUH�YLWDPLQ�'��LQ�WKH�VNLQ��WKHUHIRUH�IXQFWLRQLQJ�DV�SUR�YLWDPLQ�'����7KH�SUHVHQFH�RI�WKLV�FRPSRXQG�LQ�KXPDQ�VNLQ�HQDEOHV�KXPDQV�WR�PDQXIDFWXUH�YLWDPLQ�'��IURP�XOWUD�YLROHW�UD\V�LQ�WKH�VXQOLJKW��YLD�DQ�LQWHUPHGLDWH�LVRPHU�SUH�YLWDPLQ�'���&KROHFDOFLIHURO����,W�LV�DOVR�IRXQG�LQ�WKH�PLON�RI�VHYHUDO�PDPPDOLDQ�VSHFLHV�������&KROHFDOFLIHURO�LV�D�IRUP�RI�9LWDPLQ�'��DOVR�FDOOHG�9LWDPLQ�'����,W�LV�VWUXFWXUDOO\�VLPLODU�WR�VWHURLGV�VXFK�DV�WHVWRVWHURQH��FKROHVWHURO�DQG�FRUWLVRO��WKRXJK�YLWDPLQ�'��LWVHOI�LV�D�VHFRVWHURLG������&KROHFDOFLIHURO�KDV�VHYHUDO�IRUPV�����&DOFLRO��LV�DQ�LQDFWLYH��XQK\GUR[\ODWHG�IRUP�RI�YLWDPLQ�'�����&DOFLGLRO�LV�WKH�EORRG�FDOFLXP�IRUP���&DOFLWULRO�LV�WKH�DFWLYH�IRUP�RI�'�

���

�����+RZ�LW�PHWDEROL]HV����'HK\GURFKROHVWURO�LV�WKH�SUH�FXUVRU�RI�YLWDPLQ�'��DQG�RQO\�IRUPV�WKH�YLWDPLQ�DIWHU�EHLQJ�H[SRVHG�WR�VRODU�89�UDGLDWLRQ���7KLV�FUHDWHV�FDOFLRO���&DOFLRO�LV�WKHQ�K\GUR[\ODWHG�LQ�WKH�OLYHU�WR�EHFRPH�FDOFLGLRO����&DOFLGLRO�LV�RQFH�DJDLQ�K\GUR[\ODWHG��WKLV�WLPH�LQ�WKH�NLGQH\��DQG�EHFRPHV�FDOFLWULRO���&DOFLWULRO�LV�WKH�DFWLYH�KRUPRQH�IURP�YLWDPLQ�'���IRU�WKLV�UHDVRQ�9LWDPLQ�'�LV�RIWHQ�UHIHUUHG�WR�DV�D�SURKRUPRQH������&KROHFDOFLIHURO�LV�WKH�IRUP�RI�9LWDPLQ�'�QRUPDOO\�DGGHG�GXULQJ�IRUWLILFDWLRQ�RI�IRRGV���&KROHFDOFLIHURO�LV�SURGXFHG�LQGXVWULDOO\�E\�WKH�LUUDGLDWLRQ�RI���'H�K\GURFKROHVWURO�H[WUDFWHG�IURP�ODQROLQ�IRXQG�LQ�VKHHS¶V�ZRRO���,Q�SURGXFWV�ZKHUH�DQLPDO�SURGXFWV�DUH�QRW�GHVLUHG�WKH�DOWHUQDWLYH�LV�WR�XVH�HUJRFDOFLIHURO��9LWDPLQ�'���GHULYHG�IURP�KLV�IXQJDO�VWHURO�HUJRVWHURO�&KROHVWHURO�LV�D�OLSLG�IRXQG�LQ�WKH�FHOO�PHPEUDQHV�RI�DOO�DQLPDO�WLVVXHV��DQG�LV�WUDQVSRUWHG�LQ�WKH�EORRG�SODVPD�RI�DOO�DQLPDOV>/LSLG RUJDQLF�FRPSRXQGV�IRXQG�LQ�DOO�OLYLQJ�WKLQJV��LW�FRQWDLQV��;�WKH�DPRXQW�RI�HQHUJ\�LQ��HQHUJ\ FDORULHV��WKDQ�SURWHLQV�DQG�FDUERK\GUDWHV@���0RVW�RI�WKH�FKROHVWHURO�LQ�WKH�ERG\�LV�V\QWKHVL]HG�E\�WKH�ERG\�DQG�VRPH�KDV�GLHWDU\�RULJLQ���&KROHVWHURO�LV�PRUH�DEXQGDQW�LQ�WLVVXHV�ZKLFK�HLWKHU�V\QWKHVL]H�PRUH�RU�KDYH�PRUH�DEXQGDQW�GHQVHO\�SDFNHG�PHPEUDQHV��IRU�H[DPSOH��WKH�OLYHU��VSLQDO�FRUG�DQG�EUDLQ���,W�SOD\V�D�FHQWUDO�UROH�LQ�PDQ\�ELRFKHPLFDO�SURFHVVHV��VXFK�DV�WKH�FRPSRVLWLRQ�RI�FHOO�PHPEUDQHV�DQG�WKH�V\QWKHVLV�RI�VWHURLG�KRUPRQHV���6LQFH�FKROHVWHURO�LV�LQVROXEOH��LQVROXEOH FDQ�QRW�EH�EURNHQ�GRZQ��LQ�EORRG��LW�LV�WUDQVSRUWHG�LQ�WKH�FLUFXODWRU\�V\VWHP�&KROHVWHURO�LV�UHTXLUHG�WR�EXLOG�DQG�PDLQWDLQ�FHOO�PHPEUDQHV��LW�UHJXODWHV�PHPEUDQH�IOXLGLW\�RYHU�D�ZLGH�UDQJH�RI�WHPSHUDWXUHV���&KROHVWHURO�LV�UHTXLUHG�LQ�WKH�PHPEUDQH�RI�PDPPDOLDQ�FHOOV�IRU�QRUPDO�FHOOXODU�IXQFWLRQ����/RFDWLRQ������7KH�VNLQ�FRQVLVWV�RI�WZR�SULPDU\�OD\HUV���WKH�LQQHU�OD\HU�FDOOHG�WKH�GHUPLV��FRPSRVHG�ODUJHO\�RI�FRQQHFWLYH�WLVVXH��DQG�WKH�RXWHU�WKLQQHU�HSLGHUPLV���7KH�WKLFNQHVV�RI�WKH�HSLGHUPLV�UDQJHV�IURP�����PP�WR�PRUH�WKDQ����PP��������WR�������LQFKHV�7KH�HSLGHUPLV�FRQVLVWV�RI�ILYH�VWUDWD��OD\HUV����)URP�RXWHU�WR�LQQHU����6WUDWXP�FRUQHXP���6WUDWXP�OXFLGXP���6WUDWXP�JUDQXORVXP���6WUDWXP�VSLQRVXP���6WUDWXP�EDVDOH7KH�KLJKHVW�FRQFHQWUDWLRQV�RI���'HK\GURFKROHVWURO�DUH�IRXQG�LQ�WKH�HSLGHUPDO�OD\HU�RI�VNLQ��VSHFLILFDOO\�LQ�WKH�VWUDWXP�EDVDOH�DQG�VWUDWXP�VSLQRVXP��WKH�SURGXFWLRQ�RI�SUH�YLWDPLQ�'��LV�JUHDWHVW�LQ�WKHVH�WZR�HSLGHUPDO�DUHDV������6\QWKHVLV�RI�SUH�YLWDPLQ�'��LQ�WKH�VNLQ�LQYROYHV�89%�UDGLDWLRQ�ZKLFK�HIIHFWLYHO\�SHQHWUDWHV�RQO\�WKH�HSLGHUPDO�OD\HUV�RI�VNLQ����'HK\GURFKROHVWURO�DEVRUEV�89�OLJKW�PRVW�HIIHFWLYHO\�DW�ZDYHOHQJWKV�EHWZHHQ���������QP�DQG�WKXV�WKH�SURGXFWLRQ�RI�YLWDPLQ�'��ZLOO�RQO\�RFFXU�DW�WKRVH�ZDYHOHQJWKV���7KH�WZR�PRVW�LPSRUWDQW�IDFWRUV�WKDW�JRYHUQ�WKH�

���

JHQHUDWLRQ�RI�SUH�YLWDPLQ�DUH�WKH���4XDQWLW\��5D¶V�LQWHQVLW\������4XDOLW\��$SSURSULDWH�ZDYHOHQJWK��RI�WKH�89%�LUUDGLDWLRQ�UHDFKLQJ�WKH���'HK\GURFKROHVWURO�GHHS�LQ�WKH�VWUDWXP�EDVDOH�DQG�VWUDWXP�VSLQRVXP���$QRWKHU�LPSRUWDQW�FRQVLGHUDWLRQ�LV�WKH�TXDQWLW\�RI���'HK\GURFKROHVWURO�LQ�WKH�VNLQ��DERXW�������PJ�FP��RI�VNLQ��������%\�LQWHUDFWLRQ�ZLWK�WKH�XOWUDYLROHW�OLJKW�RI�WKH�VXQ��YLUWXDOO\�DOO�RI�WKH�VLJQLILFDQW�9LWDPLQ�'�LQ�WKH�ERG\�LV�SURGXFHG�LQ�WKH�VNLQ�E\�VXQOLJKW���6LPSO\�SXW�EODFN�VNLQ�LQ�DQ�LFH�DJH�W\SH�RI�QRUWKHUQ�HQYLURQPHQW�ZRXOG�EHFRPH�D�OLDELOLW\��UDWKHU�WKDQ�DQ�DVVHW��IURP�DQ�HYROXWLRQDU\�SHUVSHFWLYH���7KHVH�DVVHUWLRQV�DUH�SRZHUIXOO\�VXSSRUWHG�E\�WKH�IDFW�WKDW�$IULFDQV�LQ�QRUWKHUQ�ODWLWXGHV�DUH�����WLPHV�PRUH�VXVFHSWLEOH�WR�ULFNHWV�WKDQ�DUH�ZKLWHV���:H�DVVXPH�WKDW�LW�ZDV�XQGHU�FRQGLWLRQV�RI�LQWHQVH�VHOHFWLRQ�SUHVVXUH��VXFK�DV�ZRXOG�KDYH�EHHQ�IRXQG�LQ�WKH�LFH�DJH�HQYLURQPHQW�RI�VRXWKZHVWHUQ�(XUDVLD��WKDW�WKH�EODFN�VNLQ�RI�WKH�+RPR�6DSLHQV�6DSLHQV��ZKR�KDG�PLJUDWHG�WKHUH�VRPHWLPH�DIWHU�WKH�EHJLQQLQJ�RI�WKH�:XUP�,�,QWHUVWDGLDO��ZRXOG�KDYH�FKDQJHG�WR�ZKLWH�VNLQ���7KLV�$IULFRLG�+RPR�6DSLHQV�6DSLHQV�ZRXOG�KDYH�EHFRPH�LVRODWHG�LQ�WKLV�HQYLURQPHQW�DQG�LQ�WKLV�WKUHDWHQLQJ�LFH�DJH�HFRORJ\�WZR�DGDSWLYH�FKRLFHV�ZRXOG�KDYH�SUHVHQWHG�WKHPVHOYHV����H[SORLWDWLRQ�RI�GLHWDU\�VRXUFHV�ULFK�LQ�9LWDPLQ�'�ZKLFK�ZHUH�QRW�DYDLODEOH�LQ�WKH�LQQHU�����UHFHVVHV�RI�(XUDVLD���/RVV�RI�WKH�PHODQLQ�FRYHU��L�H���EODFN�VNLQ�����)RU�WKLV�VXUYLYLQJ�PDUJLQDO�SRSXODWLRQ��WKLV�ORVV�RI�EODFN�VNLQ�LV�ZKDW�LV�VXUPLVHG�WR�KDYH�RFFXUUHG���7KH�FRORU�YDULDWLRQV�IRXQG�LQ�WKH�KDLU��VNLQ�DQG�H\HV�RI�W\SLFDO�&DXFDVRLGV�DUH�PDQLIHVWDWLRQV�RI�WKH�LQFRPSOHWH�SHQHWUDQFH�DQG�YDULDWLRQ�RI�H[SUHVVLRQ�RI�WKH�JHQHV�WKDW�FRQWURO�WKLV�DOELQR�FRQGLWLRQ���,W�KDV�EHHQ�VXJJHVWHG�WKDW�WKH�IDFLDO�PRUSKRORJ\�RI�WKLV�JURXS�DOVR�HYROYHG�LQ�UHVSRQVH�WR�WKH�FOLPDWLF�VLJQDOV�LQ�WKLV�IULJLG�HQYLURQPHQW�VLQFH�WKH�VPDOOHU�QDVDO�LQGH[��QDUURZHU�QRVH��RI�WKH�&DXFDVRLG�LV�DSSDUHQWO\�PRUH�HIIHFWLYH�LQ�ZDUPLQJ�FROG�LQVSLUHG�DLU���7KH�&DXFDVRLG�W\SH�RI�KXPDQLW\�UHVXOWHG�IURP�WKH�DSSHDUDQFH�RI�DOELQRLGV�RXW�RI�DQ�RULJLQDO�$IULFRLG�VRFN��LQ�WKH�LFH�DJH�HQYLURQPHQW�RI�VRXWKZHVWHUQ�(XUDVLD�EHFDXVH�WKH�ZKLWHQHG�VNLQ�RI�WKH�DOELQRLGV�ZDV�EHWWHU�DGDSWHG�WR�9LWDPLQ�'�SURGXFWLRQ���7KH�GHYHORSPHQW�RI�WKLV�QHZ�KXPDQ�VWRFN�ZDV�PDGH�SRVVLEOH�E\�SURORQJHG�LVRODWLRQ�IURP�RWKHU�KXPDQ�JURXSV��OHDGLQJ�WR�DQ�LQEUHHGLQJ�ZLWKLQ�WKH�DOELQRLG�JURXS�ZKLFK�FRQWLQXDOO\�KHLJKWHQHG�WKH�DOELQRLG�FKDUDFWHULVWLFV���7KH�LPSRUWDQFH�RI�VXQOLJKW�WR�WKH�VXUYLYDO�RI�HDUO\�+RPR�6DSLHQV�LQ�QRUWKHUQ�ODQGV�DQG�WKH�OLPLWDWLRQV�WKDW�LW�SODFHG�RQ�KLV�KHU�IXUWKHU�H[SDQVLRQ��FDQQRW�EH�H[DJJHUDWHG���7KHVH�QXPHURXV�(XURSHDQ�1HDQGHUWKDO�VNHOHWDO�ILQGLQJV�RI�ULFNHWV�LV�FULWLFDO�SK\VLFDO�HYLGHQFH�WKDW�WKH�ILUVW�SHRSOH�LQ�(XURSH�ZHUH�EODFN�VNLQQHG������'XULQJ�WKH�ODVW�LFH�DJH��WKH�RQO\�HQWUDQFH�LQWR�WKH�$UWLF�ZDV�WKURXJK�WKLV�ZDUPHU�FRUULGRU�LQ�6LEHULD���0RQJRORLG�PHQ�ZRPEPHQ�OLYHG�LQ�WKLV�DUHD�DQG�ZHUH�DEOH�WR�IROORZ�WKH�ZDUPHU�ZHDWKHU�LQWR�WKH�QRUWK�DQG�LQKDELW�WKH�JHRJUDSKLFDO�DUHD�RI�WKH�$UWLF���&RQGLWLRQV�ZHUH�VR�ELWWHU�LQ�(XURSH�WKDW�PDQ\�WKRXVDQGV�RI�PLOHV�RI�LFH�VHSDUDWHG�(XURSH�IURP�WKH�$UWLF�DQG�SUHYHQWHG�0DQ�:RPEPDQ��QR�PDWWHU�KRZ�³&ROG�$GDSWHG�´�IURP�FURVVLQJ�WKH�VWHULOH�LFH�EDUULHU������:RUOG�FOLPDWH�KDV�FRROHG�SHULRGLFDOO\�RYHU�JHRORJLFDO�WLPH���7KH�PRVW�UHFHQW�LFH�DJH��DFFRPSDQLHG�DW�KLJK�ODWLWXGHV�DQG�HOHYDWLRQV�E\�WKH�VSUHDG�RI�LFH�VKHHWV��EHJDQ�WR�DIIHFW�WHPSHUDWH�(XUDVLD�DERXW�RQH�����PLOOLRQ�\HDUV�DJR��ZHOO�DIWHU�WKH�EHJLQQLQJ�RI�WKH�JHRORJLFDO�HSRFK�NQRZQ�DV�WKH�3OHLVWRFHQH�SHULRG������0LOOLRQ�\HDUV�DJR����6LQFH�WKDW�WLPH��WKH�FOLPDWH�KDV�DOWHUQDWHG�UHJXODUO\�EHWZHHQ�FROG�SKDVHV�RI�LFH�VKHHW�EXLOGXS�DQG�ZDUPHU�SHULRGV�FRPSDUDEOH�WR�WRGD\���2Q�DYHUDJH�LW�KDV�WDNHQ�DERXW���������\HDUV�WR�

���

SDVV�IURP�RQH�SHULRG�RI�PD[LPXP�FROG�WR�WKH�QH[W������'XULQJ�FROG�SKDVHV��LFH�VKHHWV�DGYDQFHG�RYHU�(XUDVLD�DV�IDU�VRXWK�DV�FHQWUDO�*HUPDQ\�DQG�QRUWKHUQ�&KLQD��SXVKLQJ�WKH�YHJHWDWLRQ�]RQHV��WXQGUD�DQG�WHPSHUDWH�IRUHVWV��EHIRUH�WKHP���)XUWKHU��ZRUOGZLGH�VHD�OHYHOV�GURSSHG��RIWHQ�E\�VHYHUDO�KXQGUHG�IHHW��DV�D�UHVXOW�RI�WKH�ORFNLQJ�XS�RI�SUHFLSLWDWLRQ�LQ�WKH�H[SDQGLQJ�JODFLHU���7KXV�DGYDQFLQJ�LFH�VKHHWV�QRW�RQO\�IUDJPHQWHG�KXPDQ�SRSXODWLRQV�OLYLQJ�LQ�PRUH�QRUWKHUO\�DUHDV��EXW�DOORZHG�KXPDQV�WR�FRORQL]H�UHJLRQV�VXFK�DV�-DYD��ZKLFK�ZDV�DSSDUHQWO\�UHDFKHG�DW�DURXQG�RQH�����PLOOLRQ�\HDUV�DJR�DQG�KDG�SUHYLRXVO\�EHHQ�LVRODWHG�E\�VKDOORZ�VHDV���,Q�WURSLFDO�DUHDV��$IULFD���WKH�FROGHU�SHULRGV�KDG�LQFUHDVHG�UDLQIDOO������,Q�FRQFOXVLRQ��WKH�DFFXPXODWLRQ�RI�WKH�EHVW�DQG�PRVW�DFFXUDWH�LQIRUPDWLRQ�QRZ�PDNHV�LW�YHU\�FOHDU�WKDW�KXPDQNLQG�KDG�KHU�KLV�RULJLQ�LQ�$IULFD���7KLV�$IULFDQ�DOPRVW�XQLODWHUDOO\�SHRSOHG�DQG�LQIOXHQFHG�WKH�ZRUOG�IURP�ILYH�����PLOOLRQ�\HDUV�EHIRUH�WKH�&KULVWLDQ�HUD�WR�WKH�JODFLDO�WKDZ�RI�WKH�:XUPLDQ�JODFLDWLRQ�SHULRG�WKDW�HQGHG�DERXW��������\HDUV�EHIRUH�WKH�&KULVWLDQ�HUD��7KH�/LIH�+LVWRU\�RI�WKH�$VLDQ������&KDQFHODGH�PDQ��ZKR�SUREDEO\�LV�WKH�SURWRW\SH�IRU�7RGD\¶V�$VLDQ�HWKQLF�VWRFN�DSSHDUHG�LQ�WKH�5HLQGHHU�SHULRG��DERXW��������\HDUV�DJR��GXULQJ�WKH�0DJGDOHQLDQ�SHULRG���6KH�KH�FRXOG�KDYH�EHHQ�D�FRPELQDWLRQ��FURVV�EUHHG���ERUQ�XQGHU�D�FROG�FOLPDWH��RI�WKH�*ULPDOGL�0DQ�:RPEPDQ��$IULFDQ��LQ�(XURSH�DQG�RI�WKH�QHZ�&UR�0DJQRQ��$IULFDQ�(XUDVLDQ����,Q�IDFW��$VLDQ�SHRSOHV�KDYH�WKH�SLJPHQWDWLRQ�RI�PL[HG�SHRSOHV��VR�PXFK�VR�WKDW�WKH�FRPSDUDWLYH�ELRFKHPLFDO�DQDO\VLV�ZRXOG�EH�XQDEOH�WR�UHYHDO�DQ\�JUHDW�GLIIHUHQFH�LQ�WKH�TXDQWLW\�RI�PHODQLQ���1R�V\VWHPDWLF�VWXG\�RI�EORRG�JURXSV�LQ�PL[HG�SHRSOH�KDV�EHHQ�PDGH�WR�GDWH���,W�ZRXOG�KDYH�SHUPLWWHG�DQ�LQWHUHVWLQJ�FRPSDULVRQ�ZLWK�WKRVH�RI�WKH�$VLDQ�VWRFN������7KH�HWKQLF�IHDWXUHV�RI�$VLDQV�LQFOXGLQJ�OLSV��QRVH��DQG�SURJQDWKLVP�DUH�WKRVH�RI�D�PL[HG�SHRSOH���7KHLU�IDFHV��KLJK�FKHHNERQHV��SXIIHG�H\HOLGV��0RQJROLDQ�SXFNHU��VPDOO�H\HV��GHSUHVVLRQ�RI�WKH�EULGJH�RI�WKH�QRVH���FRXOG�PHUHO\�UHVXOW�IURP�WKH�HIIHFW�RI�WKRXVDQGV�RI�\HDUV�LQ�D�FOLPDWH�WKDW�EORZV�FROG�ZLQGV�RQ�WKH�IDFH���7KH�FULVSDWLRQ�RI�WKH�IDFH�DV�UHVXOW�RI�WKH�ZLQG�ZRXOG�VXIILFH�WR�H[SODLQ�WKH�SURPLQHQW�FKHHNERQHV�DQG�SXIIHG�H\HOLGV�ZKLFK�IRUP�WZR�FRUUHODWLYH�HWKQLF�WUDLWV���%HDWLQJ�DJDLQVW�WKH�IDFH�LQ�FROG�ZHDWKHU��WKH�ZLQG�FDQ�HVFDSH�WKURXJK�WKH�FRUQHU�RI�WKH�H\H�RQO\�E\�IROORZLQJ�DQ�REOLTXH�XSZDUG�PRYHPHQW��DIWHU�WKH�PROHFXOHV�RI�DLU�KDYH�EHHQ�ZDUPHG���,Q�WKH�ORQJ�UXQ��WKLV�PHFKDQLFDO�IRUFH�FRXOG�SURGXFH�D�IRUPDWLRQ�RI�WKH�H\H�LQ�WKH�VDPH�GLUHFWLRQ���6XFK�DQ�DFWLRQ�E\�WKH�FOLPDWH�FRXOG�EH�HYHQ�VWURQJHU�RQ�D�\RXQJ�KXPDQ�FKLOG���7KLV�H[SODQDWLRQ�DVVXPHV�WKH�KHUHGLW\�RI�DFTXLUHG�FKDUDFWHULVWLFV���,W�LV�NQRZQ��PRUHRYHU��WKDW�WKHVH�IHDWXUHV��FDOOHG�0RQJROLDQ��FKDQJH�IURP�QRUWKHUQ�WR�VRXWKHUQ�$VLD�IROORZLQJ�WR�VRPH�H[WHQW�D�FOLPDWLF�FXUYH���,W�KDV�EHHQ�REVHUYHG�WKDW�ZKHUHYHU�WKHUH�DUH�$VLDQ�SHRSOH��RQH�VWLOO�ILQGV�VPDOO�SRFNHWV�RI�$IULFDQV�DQG�(XUDVLDQV�ZKR�VHHP�WR�EH�UHVLGXDO�HOHPHQWV�RI�WKH�$VLDQ�VWRFN���7KLV�LV�WKH�FDVH�WKURXJKRXW�VRXWKHDVW�$VLD���7KH�1LRUV�OLYH�LQ�WKH�PRXQWDLQV�RI�9LHWQDP�ZKHUH�LQ�DGGLWLRQ��LW�LV�FXULRXV�WR�HQFRXQWHU�VXFK�QDPHV�DV�.KD��7KDL��DQG�&KHP���7KH�1HJULWRV�DQG�$LQXV�OLYH�LQ�-DSDQ���7KHUH�LV�D�IDPRXV�-DSDQHVH�SURYHUE��³)RU�D�6XPDUDL�WR�EH�EUDYH��KH�PXVW�KDYH�D�ELW�RI�%ODFN�%ORRG�´��&KLQHVH�FKURQLFOHV�UHSRUW�WKDW�DQ�$IULFDQ�HPSLUH�H[LVWHG�LQ�WKH�VRXWK�RI�&KLQD�DW�WKH�GDZQ�RI�WKDW�FRXQWU\¶V�KLVWRU\�3URWR�$U\DQ���3URWR�'UDYLGLDQ���FROG�&OLPDWH� �$VLDQ�(WKQLF�6WRFN

���

�����)URP�VRXWKHUQ�$VLDQ�JURXSV�RI�$IULFRLGV�PLJUDWHG�QRUWKZDUG�LQWR�WKH�QRUWKHUQ�$VLDQ�VWHSSHG�LQ�SUHVHQW�GD\�0RQJROLD��GXULQJ�WKH�:XUPLDQ�JODFLDO�DQG�XQGHUZHQW�D�VHULHV�RI�DGDSWDWLRQV�WKDW�SURGXFHG�WKH�0RQJRORLG�W\SH�RI�KXPDQV��VKRUW�LQ�VWDWXUH��ZLWK�ODQN�EODFN�KDLU��D�GLUHFW�LQKHULWDQFH�IURP�WKH�$VLDQ�$IULFDQ��HSLFDQWDO�IROGV�DURXQG�WKH�H\HV��WR�KHOS�SURWHFW�DJDLQVW�WKH�FRQVWDQW�ZLQG�RI�WKH�VWHSSHV�DQG�D�\HOORZLVK�FRPSOH[LRQ���$IWHU�D�FHUWDLQ�WLPH��WKH�0RQJRORLGV�SUREDEO\�PDGH�FRQWDFW�DQG�LQWHUPLQJOHG�ZLWK�&DXFDVRLGV�IURP�WKH�ZHVWHUQ�UHDFKHV�RI�WKH�JUHDW�(XUDVLDQ�SODLQV���7KH\�ZRXOG�KDYH�DOVR�PDGH�FRQWDFW�IURP�WLQH�WR�WLPH�ZLWK�$IULFRLGV�LQ�6RXWKHUQ�$VLD���1HDQGHUWKDO�+RPR�6DSLHQV�LQ�(XUDVLD�������7KH�1HDQGHUWKDOV��DOVR�FODVVLILHG�DV�+RPR�6DSLHQV�RULJLQDWHG�LQ�RQH�RI�WKH�IROORZLQJ�ZD\V����%\�PL[WXUH�RI�(XURSHDQ�&DXFDVLDQ�VWRFN�ZLWK�(DVWHUQ�6LQDQWKURSXV�$VLDQ�VWRFN���%\�LQGLJHQRXV�HYROXWLRQ�LQ�(XURSH�LWVHOI�IURP�+RPR�6DSLHQV�VWRFN�RU�IURP�VRPH����PRUH�DQFLHQW�VWRFN�GXH�WR�VHOHFWLRQ�IRU�FROG�VXUYLYDO�TXDOLWLHV��*ULPDOGL�&UR�0DJQRQ������7KH�ROGHVW�1HDQGHUWKDO�IRVVLOV�RI�(XURSH�VFDUFHO\�VHHP�WR�GDWH�EDFN�EH\RQG�WKH�,QWHUVWDGLDO�:XUP�,�,,���������%&(����7KHUH�LV�DQ�LQFUHDVLQJ�ERG\�RI�VFLHQWLILF�GDWD�VXJJHVWLQJ�WKDW�WKLV�JURXS�RI�PHQ�ZRPEPHQ�GLG�QRW�GHYHORS�LQ�D�QDUURZ�]RQH�RI�FDYH�ILUHV�DQG�WKH�VDYDJH�FROG�RI�WKH�:XUP�,�LFH�DJH���:H�ZLOO�DWWHPSW�WR�VKRZ�WKDW�JODFLDO�HYROXWLRQ�GHPDQGHG�FHUWDLQ�VSHFLDO�DGDSWDWLRQV�RI�1HDQGHUWKDO�ZRPEPHQ�PHQ�DQG�WKDW�SUHVHQW�GD\�(XUDVLDQV�VWLOO�VKRZ�SK\VLFDO�DQG�PHQWDO�YHVWLJHV�RI�WKHVH�DGDSWDWLRQV���7KH�1HDQGHUWKDOV�DSSDUHQWO\�GLHG�RXW�ZLWK�WKH�ZDUPHU�ZHDWKHU�RI�WKH�:XUPLDQ�,QWHUVWDGLDO�DQG�PRUH�PRGHUQ�NLQGV�RI�PHQ�PLJUDWHG�LQWR�(XURSH���7KH�ODVW�:XUPLDQ�FROG�VQDS�IURP�DERXW��������������%&(�ZDV�HQGXUHG�E\�HVVHQWLDOO\�PRGHUQ�PHQ�ZRPEPHQ�ZKR�ZHUH�WKH�DQFHVWRUV�RI�(XURSHDQV�WRGD\���������&ODVV������+RPR�/LQH���3DUW����+RPR�6DSLHQV�+RPR�6DSLHQV�������������������6DSLHQV&ODVV�4XHVWLRQ�±�:KDW�%UDLQ�'HYHORSPHQWV�(OHYDWHG�WKH�7KLQNLQJ�&DSDFLW\�RI�WKH�������������������������������7ZR�)LQDO�3KDVHV�RI�WKH�+XPDQ�%HLQJ"�5HDGLQJV�2ULJLQ�RI�+XPDQNLQG��*.��S���������/LIH�+LVWRU\�1RWHV��S������+RPR�6DSLHQV�6DSLHQV�&%�$IULFDQ�2ULJLQ�RI�+RPR�6DSLHQV��������

���

�&ODVV������+XPDQ�0RYHPHQW�1RUWK�1RUWK�:HVW�$FURVV�WKH������������������$IULFDQ�&RQWLQHQW&ODVV�4XHVWLRQ����:KHUH�'LG�$IULFDQV�0LJUDWH�7R�,Q�$IULFD"�����������������������5HDGLQJV�3UH�FRORQLDO�$IULFD��'U��'LRS��S����������/LIH�+LVWRU\�1RWHV��S������������DQG���±�/LIH�$ORQJ�+DSL�&%�([SDQVLRQ�RI�+RPR�6DSLHQV�&O��������������������������&ODVV������+XPDQ�0LJUDWLRQ�2XW�RI�$IULFD���3DUW��&ODVV�4XHVWLRQ���:KHUH�'LG�$IULFDQV�0LJUDWH�,Q�$VLD��(DVWHUQ�$VLD�"�5HDGLQJV�$IULFDQ�3UHVHQFH�LQ�(DUO\�(XURSH���,96��S�����������������/LIH�+LVWRU\�1RWHV��S������������������������±�0HODQLQ��&%�'HYHORSPHQW�RI�+DQGV�DQG�7RROV��(DUO\�+RPR�/LQH�LQ�$IULFD������������������+RPLQLGV�/HDYH�$IULFD���&ODVV������+XPDQ�0LJUDWLRQ�2XW�RI�$IULFD���3DUW���&ODVV�4XHVWLRQ��:KHUH�'LG�$IULFDQV�0LJUDWH�,Q�(XURSH��:HVWHUQ�$VLD�"�5HDGLQJV�2ULJLQV�RI�+XPDQNLQG��*.��S�±����������/LIH�+LVWRU\�1RWHV��S���������������±�)LUVW�0LJUDWLRQV���/LIH�+LVWRU\�1RWHV��S��������&%�1HDQGHUWKDOV�$�'LVWLQFW�6SHFLHV��1HDQGHUWKDOV�DQG�0RGHUQ�+XPDQV��&ODVV�����7KH�)RXU�����,FH�$JHV&ODVV�4XHVWLRQ���:KDW�+DSSHQHG�'XULQJ�(DUWK¶V���0DMRU�,FH�$JHV������������������������������*HRJUDSKLFDOO\��*HRORJLFDOO\��+LVWRULFDOO\"�&ODVV������7KH���VW�3DUDOOHO�/DWLWXGH�±�'LYLGLQJ�/LQH�RI�WKH�����������������1RUWKHUQ�DQG�6RXWKHUQ�&UDGOH&ODVV�4XHVWLRQ���:KDW�,V�WKH�7ZR�&UDGOH�7KHRU\��1RUWKHUQ�6RXWKHUQ�"������������������������������:KDW�+DSSHQHG�1RUWK�$ERYH�WKH���VW�3DUDOOHO�/DWLWXGH�/LQH"�5HDGLQJV�)RU�&ODVV����DQG���&LYLOL]DWLRQ�RU�%DUEDULVP��'U��'LRS��3DUW��������������������&%��+XPDQ�6NLQ���

���

�&ODVV������(WKLRSLD�DQG�WKH�2ULJLQ�RI�&LYLOL]DWLRQ&ODVV�4XHVWLRQ�±�+RZ�'LG�&LYLOL]DWLRQ�2ULJLQDWH�,Q�(WKLRSLD��1RUWKHUQ�.HQ\D��������������������������������(WKLRSLD��6RPDOLD��'MLERXWL��(ULWUHD��6XGDQ��6RXWKHUQ�.HPHW"��5HDGLQJV,QWUR�WR�$IULFD�±�-*-�±�������:RQGHUIXO�(WKLRSLDQV���''+�±�&KDSWHUV�������DQG����S�������:KHQ�:H�5XOHG���5:&K����±�³:KDW�,V�%ODFN�+LVWRU\´�±�3������&K����±�³(DUO\�+LVWRU\�RI�WKH�1LOH�9DOOH\´�3�±��������&K�����±�³(DVW�$IULFDQ�$QWLTXLWLHV´�±�3��������&K�����±�³0HGLHYDO�1XELD´�±�3����������&RXUVH�2XWOLQH.HPHW��$QFLHQW�(J\SW��ZLOO�UHPDLQ�D�P\VWHU\�XQWLO�WKH�SHRSOH�ODQG�RI�.XVK��1XELD��LV�JHRJUDSKLFDOO\�DQG�FXOWXUDOO\�DGMRLQHG�WR�WKH�SHRSOH�ODQG�RI�.HPHW��(J\SW���7KLV�FRXUVH�ZLOO�H[SORUH�WKH�UROH�WKDW�$IULFDQV�SOD\HG�LQ�WKH�GHYHORSPHQW�RI�WKHVH�FLYLOL]DWLRQV�DORQJ�WKH�1RUWKHDVWHUQ�UHJLRQ�RI�$IULFD�FDOOHG�WKH�³+DSL��1LOH��9DOOH\�´��%RRNV��(�5HV¶�DQG�3UHVHQWDWLRQV�DQG�'9'¶V�ZLOO�LQFOXGH�WKH�PRVW�UHFHQW�UHVHDUFK�UHJDUGLQJ�$IULFDQ�SRSXODWLRQV�GXULQJ�WKH�3UH�'\QDVWLF�DQG�'\QDVWLF�3HULRGV��������%&(�����%&(���&RXUVH�2EMHFWLYHV

�� 'LVFXVV�WKH�RXWOLQH�RI�1RUWKHDVW�$IULFDQ�+LVWRU\�IURP�6RXWKHUQ�1XELD��6XGDQ��WR�1RUWKHUQ�.HPHW��(J\SW��

�� 'HVFULEH�WKH�*HRJUDSKLFDO�DQG�+LVWRULFDO�LPSDFW�RQ�1RUWKHDVW�$IULFD�E\�WKH�LQGLJHQRXV�SHRSOH�LQ�VSHDNLQJ�DQG�ZULWLQJ�

�� $UWLFXODWH�DQ�XQGHUVWDQGLQJ�RI�WKH�,QWHUUHODWLRQVKLS�EHWZHHQ�6FLHQFH�DQG�7HFKQRORJ\�HQFRGHG�ZLWKLQ�WKH�S\UDPLGV��WHPSOHV��EXLOGLQJV�DQG�DUWLIDFWV�LQ�.XVK�DQG�.HPHW�

�� /RFDWH�PDWHULDOV�UHOHYDQW�WR�WKH�FRXUVH�LQ�OLEUDU\�GDWDEDVHV��� &ULWLTXH�ERRNV��PDJD]LQH�DQG�(�5HV�DUWLFOHV�DQG�'9'¶V�RUDOO\�DQG�LQ�ZULWLQJ��� &UHDWH�D�SODQ�DQG�GHYHORS�DQ�DUW�SURMHFW�DV�DQ�RYHUDOO�FRXUVH�SURMHFW�GLUHFWO\�

UHODWHG�WR�REMHFWLYH����DERYH��%RRN�/LVW�7KH�$IULFDQ�2ULJLQ�RI�&LYLOL]DWLRQ��0\WK�RU�5HDOLW\��'U��&KHLNK�$QWD�'LRS��/DZUHQFH�+LOO�DQG�&RPSDQ\��86$�������.XVK��7KH�-HZHO�RI�1XELD��0LULDP�0D¶DW�.D�5H�0RQJHV��$IULFDQ�:RUOG�3UHVV��1-����������

���

(J\SW�5HYLVLWHG��³2ULJLQ�RI�WKH�$QFLHQW�(J\SWLDQV�´�&KHLNK�$QWD�'LRS³:RUNLQJ�&KURQRORJ\�RI�WKH�5R\DO�.HPHWLF�'\QDVWLHV��5XQRNR�5DVKLGL³:DVHW��7KH�(\H�RI�5D�DQG�WKH�$ERGH�RI�0D¶DW���7KH�3LQQDFOH�RI�%ODFN�/HDGHUVKLS�LQ�WKH�$QFLHQW�:RUOG��$VD�*��+LOOLDUG%ODFNV�,Q�6FLHQFH�³1DPRUDWXQJD���WKH�)LUVW�$UFKDHR�$VWURQRPLFDO�(YLGHQFH�LQ�6XE�6DKDUDQ�$IULFD�´�%�0��/\QFK�DQG�/�+��5REELQV(J\SW��&KLOG�RI�$IULFD�³$IULFDQ�2ULJLQ�RI�$QFLHQW�(J\SWLDQ�&LYLOL]DWLRQ�´�,YDQ�9DQ�6HUWLPD³1LOH�*HQHVLV���&RQWLQXLW\�RI�&XOWXUH�IURP�WKH�*UHDW�/DNHV�WR�WKH�'HOWD�´�&KDUOHV�)LQFK³7KH�5DFLDO�,GHQWLW\�RI�$QFLHQW�(J\SWLDQ�3RSXODWLRQV�EDVHG�RQ�WKH�$QDO\VLV�RI�3K\VLFDO�5HPDLQV�´�.HLWK�:��&UDZIRUG³%ODFN�/DQG�RI�$QWLTXLW\���$�%ULHI�+LVWRULFDO�2XWOLQH�RI�'\QDVWLF�.PW�´�5XQRNR�5DVKLGL³7KH�6L[WK�1DSDWDQ�'\QDVW\�RI�.XVK�´�3HJJ\�%URRNV�%HUWUDP³3UH�'\QDVWLF�(J\SW���$Q�$IUL�&HQWULF�9LHZ�´�-DPHV�%UXQVRQ�,,,��5HYLHZHG�E\�5HJLQD�%ODFNEXUQ³(J\SW�DQG�WKH�0RXQWDLQV�RI�WKH�0RRQ�´�)�'�3��:KLWDNHU��5HYLHZHG�E\�$QWKRQ\�5LFKDUGV³6HYHQ�7LPHV�6HYHQ��WKH�6HYHQ�+HUPHWLF�3ULQFLSOHV�RI�$QFLHQW�(J\SW��³:D\QH�&KDQGOHU�&RXUVH�6\OODEXV�&ODVV������,QWURGXFWLRQ�2YHUYLHZ&ODVV�4XHVWLRQ�±�:K\�,V�.XVK�,PSRUWDQW�WR�8QGHUVWDQGLQJ�.HPHW"�5HDGLQJV�.XVK��5H�0RQJHV�±�³*ORVVDU\´��SJ��������0\WK�RU�5HDOLW\��'U��'LRS�³7UDQVODWRU¶V�3UHIDFH�´SJ�L[�[L��³3UHIDFH�´�SJ�[LL�[YLL��³1RWHV�´�SJ���������������������������������������������&K�;,,,�³(DUO\�+LVWRU\�RI�+XPDQLW\�´�SJ����������&ODVV����±�.XVK��%LUWKSODFH�RI�.HPHW«.HPHW��&KLOG�RI�.XVK&ODVV�4XHVWLRQ���:K\�,V�.HPHW�,PSRUWDQW�WR�8QGHUVWDQGLQJ�.XVK"�5HDGLQJV�.XVK��5H�0RQJHV�&K���³$QFHVWUDO�%HJLQQLQJV�´�SJ�������&K���³&OHDULQJ�0XGGOHG�3HUVSHFWLYHV�´�SJ��������&K���³(PDQFLSDWLQJ�WKH�6WXG\�RI�$IULFDQ�&XOWXUH�DQG�+LVWRU\�´�SJ����������

���

&ODVV������7KH�1DWLRQ�RI�.HUPD&ODVV�4XHVWLRQ�±�:KDW�,PSDFW�'LG�WKH�1DWLRQ�RI�.HUPD�+DYH�2Q�.XVK"�5HDGLQJV�.XVK�±�5H�0RQJHV&K���±�³$IULFDQ�&RPPRQDOLWLHV�´�SJ������&K���±�³'LYLQH�.LQJVKLS�´�SJ��������&ODVV������7KH�1DWLRQ�RI�1DSDWD&ODVV�4XHVWLRQ�±�:KDW�5ROH�'LG�1DSDWD�+DYH�2Q�.XVK�DQG�.HPHW�5HDGLQJV�.XVK�±�5H�0RQJHV&K���±�³0DWULDUFK\�´�SJ��������&K���±�³7RWHPLVP�´�SJ��������&K���±�³1RW�WKH�(QG�´�SJ����������&ODVV�����7KH�1DWLRQ�RI�0HURH&ODVV�4XHVWLRQ�±�:K\�:DV�0HURH�,PSRWDQW�WR�WKH�'HYHORSPHQW�RI�.XVK"�5HDGLQJV�%ODFNV�LQ�6FLHQFH��HG��,96HUWLPD�±�³/RVW�3KDUDRKV�RI�1XELD�´�%UXFH�:LOOLDPV��&ODVV�������4XVWDO�1XELD�±�7KH�2ULJLQV�RI�WKH��VW�'\QDVW\�RI�.HPHW&ODVV�4XHVWLRQ�±�:KDW�(YLGHQFH�([LVWV�7KDW�6XSSRUW�DQ�$IULFDQ�2ULJLQ�RI�WKH��������������������������������VW�'\QDVW\�RI�.HPHWL"�5HDGLQJV�$IULFDQ�2ULJLQ�RI�&LYLOL]DWLRQ��&KHLNK�$QWD�'LRS&K�;,�±�³&RQWULEXWLRQV�RI�(WKLRSLD��1XELD�DQG�(J\SW��SJ���������&K�,�±����³:KDW�:HUH�WKH�(J\SWLDQV�´�SJ����&K�,,�±���³%LUWK�RI�WKH�1HJUR�0\WK�´�SJ���������&ODVV����±.HPHW��(J\SW��DQG�WKH�2ULJLQ�RI�7HFKQRORJ\��3DUW��&ODVV�4XHVWLRQ�±�+RZ�'LG�.HPHW�,PSDFW�DQFLHQW�DQG�0RGHUQ�7HFKQRORJ\"�5HDGLQJV:RQGHUIXO�(WKLRSLDQV±�''+�±�&KDSWHUV������DQG�����S��������:KHQ�:H�5XOHG���5:&K����±�³7KH�/DWHU�+LVWRU\�RI�WKH�1LOH�9DOOH\´�±�3��������&K����±�³(J\SWLDQ�&KURQRORJ\´�±�3�����������

���

&ODVV����±�$IULFDQ�(J\SW"�0\WK�RU�5HDOLW\&ODVV�4XHVWLRQ�±�:DV�.HPHW�$Q�$IULFDQ�1DWLRQ"�,V�,W�6WLOO�,Q�4XHVWLRQ"�5HDGLQJV�$IULFDQ�2ULJLQV��&KHLNK�$QWD�'LRS&K�,,,�±���³0RGHUQ�)DOVLILFDWLRQ�RI�+LVWRU\�´�SJ������&+�9,,�±�³$UJXPHQWV�6XSSRUWLQJ�D�1HJUR�2ULJLQ�´�SJ���������&+�9,,�±�³$UJXPHQWV�2SSRVLQJ�D�1HJUR�2ULJLQ�´�SJ�����������&ODVV����±�&XOWXUDO�2ULJLQV�RI�WKH�.HPLWHV��(J\SWLDQV�&ODVV�4XHVWLRQ�±�:KDW�,V�7KH�&XOWXUDO�,PSDFW�2I�$IULFDQV�2Q�.HPHW"�5HDGLQJV�$IULFDQ�2ULJLQV��&KHLNK�$QWD�'LRS&K�,9�±�³&RXOG�(J\SWLDQ�&LYLOL]DWLRQ�+DYH�2ULJLQDWHG�LQ�WKH�'HOWD�´SJ�������&K�9�±�³&RXOG�(J\SWLDQ�&LYLOL]DWLRQ�%H�RI�$VLDQ�2ULJLQ�´�SJ���������&K�9,�±�³7KH�(J\SWLDQ�5DFH�DV�6HHQ�DQG�7UHDWHG�E\�$QWKURSRORJLVWV�´�SJ�����������&ODVV����±�7KH�2OG�.LQJGRP�±�'\QDVWLHV���DQG��&ODVV�4XHVWLRQ�±�:KDW�$UH�7KH�&RQWULEXWLRQV�RI�7KH�2OG�.LQJGRP�2Q������������������������������.HPHW"�5HDGLQJV�%ODFNV�LQ�6FLHQFH��HG��,96HUWLPD��³7KH�3\UDPLGV��$QFLHQW�6KRZFDVH�RI�$IULFDQ�6FLHQFH������������������������������������������������������������$QG�7HFKQRORJ\�´�%HDWULFH�/XPSNLQ��&ODVV������3\UDPLG�'\QDVWLHV�±�'\QDVWLHV���WKURXJK��&ODVV�4XHVWLRQ�±�:KDW�,PSDFW�+DYH�7KH�3\UPDLGV�KDG�2Q�7HFKQRORJ\"�5HDGLQJV�.HPHW�DQG�WKH�$IULFDQ�:RUOGYLHZ���HG�&DUUXWKHUV�-�QG�.DUHQJD�0����������������������������������������������������������³�VW�DQG��QG�,QWHUPHGLDWH�3HULRG�´�-RVHI�%HQ�/HYL(J\SW�5HYLVLWHG��³7KH�0LGGOH�.LQJGRP��$�3KRWR�(VVD\�´�5XQRNR�5DVKLGL�&ODVV������7KH��VW�,QWHUPHGLDWH�3HULRG�DQG�WKH�0LGGOH�.LQJGRP&ODVV�4XHVWLRQ����±�:KDW�+DSSHQHG�GXULQJ�WKH�,QWHUPHGLDWH�3HULRG"�����������������������������±�:KR�&UHDWHG�WKH�0LGGOH�.LQJGRP"5HDGLQJV�(J\SW�5HYLVLWHG��³%ODFN�5XOHUV�RI�WKH�*ROGHQ�$JH�´�/H*UDQG�&OHJJ´�����

���

�&ODVV���±.HPHW�(J\SW�DQG�WKH�2ULJLQ�RI�7HFKQRORJ\�3DUW���&ODVV�4XHVWLRQ�±�:KDW�$UH�7KH�7HFKQRORJLFDO�$GYDQFHV�RI�.HPHW�7KDW�6WLOO�([LVW"������������������������������5HDGLQJV:KHQ�:H�5XOHG��5:&K����±�³7KH�(J\SWLDQ�4XHVWLRQ´�±�3��������&ODVV����±�7KH�6HFRQG�,QWHUPHGLDWH�3HULRG�DQG�WKH�1HZ�.LQJGRP�DQG���������������������7KH�5DPHVVLGV��7KH���WK�DQG���WK�'\QDVWLHV����&ODVV�4XHVWLRQ�±�+RZ�'LG�WKH���WK�'\QDVW\�,PSDFW�WKH�7KHQ�.QRZQ�:RUOG"�5HDGLQJV�(J\SW�5HYLVLWHG�±�³7KH�1XELDQ�5HQDLVVDQFH�´�3KDRQ�*ROGPDQ�7DKDUND��&ODVV����±�7KH���WK�'\QDVW\�)URP�1XELD&ODVV�4XHVWLRQ�±�+RZ�'LG�.XVKLWHV�)URP�6XGDQ�5HVXUUHFW�.HPHWLF�&XOWXUH"�5HDGLQJV�%RRN����$IULFDQ�2ULJLQV��&KHLNK�$QWD�'LRS&K�,;�±�3HRSOLQJ�RI�$IULFD�IURP�WKH�1LOH�9DOOH\��SJ��������&K�;�±�3ROLWLFDO�DQG�6RFLDO�(YROXWLRQ�RI�$QFLHQW�(J\SW��SJ���������&ODVV����±7KH�(QG�RI�$IULFDQ�.HPHW�WKH�&RPLQJ�RI�&DPE\VHV�����������������$QG�WKH�3HUVLDQV&ODVV�4XHVWLRQ�±�:KDW�%URXJKW�$ERXW�WKH�HQG�RI�$IULFDQ�*RYHUQDQFH�������������������������������,Q�.HPHW"��������������&ODVV�����6KDEDND�6WRQH�±�3DUW��&ODVV�4XHVWLRQ�±�:KDW�,V�7KH�6KDEDND�6WRQH"�5HDGLQJV0HPSKLWH�7KHRORJ\�±�0XDWD�$VKE\$XWKRU¶V�)RUZDUG��3DUW����3DUW�,,�DQG�3DUW�,,,��3�±��������&ODVV������6KDEDND�6WRQH�±�3DUW��&ODVV�4XHVWLRQ�±�:KDW�$UH�WKH�6HFWLRQV�DQG�3KLORVRSKLHV�2I�7KH�6KDEDND�6WRQH"5HDGLQJV0HPSKLWH�7KHRORJ\3DUW�,,,,��3DUW�,,,,,��3���������

���

&ODVV�����$QFLHQW�0LG�:HVWHUQ�$VLD�,QFOXGLQJ�$UDELD&ODVV�4XHVWLRQ�±�:KDW�5ROH�'LG�$IULFD�3OD\�,Q�7KH�&UHDWLRQ�RI�:HVW�$VLDQ������������������������������&XOWXUH"5HDGLQJV:RQGHUIXO�(WKLRSLDQV�±�''+&K����������������������������S��������:KHQ�:H�5XOHG���5:&K�����±�³3HRSOLQJ�RI�WKH�$QFLHQW�(DVW´�±�3��������&K�����±�³6XPHU�DQG�(ODP´���3���������&ODVV�����$QFLHQW�,QGLD��&ODVV�4XHVWLRQ�±�+RZ�'LG�$IULFDQV�(VWDEOLVK�7KH�$QFLHQW�&XOWXUHV�RI�,QGLD"�5HDGLQJV:KHQ�:H�5XOHG���5:&K�����±�³,QGXV�9DOOH\�DQG�$UDELD´�±�3���������&ODVV�����$QFLHQW�$VLD���&ODVV�4XHVWLRQ�±�+RZ�'LG�$IULFD�&RQWULEXWH�7R�&KLQD��-DSDQ�DQG�WKH�)DU�(DVW"�5HDGLQJV,QWUR�WR�$IULFD���-*-�±�S����������%RRNV�$IULFDQ�3UHVHQFH�LQ�(DUO\�$VLD��HG��'U��,YDQ�9DQ�6HUWLPD�DQG�5XQRNR�5DVKLGL��7UDQVDFWLRQ�3UHVV�1-��������:RQGHUIXO�(WKLRSLDQV�RI�WKH�$QFLHQW�&XVKLWH�(PSLUH'UXVLOOD�'XQMHH�+RXVWRQ%ODFN�&ODVVLF�3UHVV��%DOWLPRUH��0'������������:KHQ�:H�5XOHG�WKH�:RUOG��5RELQ�:DONHU��(YHU\�*HQHUDWLRQ�0HGLD�������&ODVV������,QWURGXFWLRQ�DQG�2YHUYLHZ&ODVV�4XHVWLRQ�±�:KDW�5ROH�'LG�$IULFD�3OD\�LQ�'HYHORSLQJ�(DUO\�$VLDQ�&XOWXUH"�5HDGLQJV$IULFDQ�3UHVHQFH�*ORVVDU\��S��������&K������³3UHIDFH�WR�WKH�7HQWK�$QQLYHUVDU\�(GLWLRQ�´�5XQRNR�5DVKLGL��S����&K������³,QWUR�WR�WKH�7HQWK�$QQLYHUVDU\�(GLWLRQ�´�5XQRNR�5DVKLGL��S������&K������³(GLWRULDO�DQG�,QWURGXFWLRQ�WR�WKH�ILUVW�(GLWLRQ�´�,YDQ�9DQ�6HUWLPD��S������&K������³'HGLFDWLRQ�DQG�7ULEXWH���7KH�3DVVLQJ�RI�*LDQWV���-RKQ�*ORYHU�-DFNVRQ�DQG�����������&KDQFHOORU�:LOOLDPV�´�5XQRNR�5DVKLGL��S������&K������³$IULFDQV�LQ�(DUO\�$VLDQ�&LYLOL]DWLRQV���$Q�2YHUYLHZ�´�5XQRNR�5DVKLGL��S������:KHQ�:H�5XOHG³7KH�3HRSOLQJ�RI�WKH�$QFLHQW�(DVW�´�5RELQ�:DONHU��S��������

���

�&ODVV������$IULFDQ�3UHVHQFH�LQ�(DUO\�6RXWKZHVW�$VLD&ODVV�4XHVWLRQ�±�:KDW�,PSDFW�'LG�$IULFDQV�KDYH�LQ�6RXWKZHVW�$VLD"�5HDGLQJV$IULFDQ�3UHVHQFH�&K��������³(J\SWLDQ�&LYLOL]DWLRQ�LQ�&ROFKLV�RQ�WKH�%ODFN�6HD�´�5DILTXH�$OL�-DLUD]EKR\���������������S������&K�������³%ODFNV�DQG�-HZV�LQ�+LVWRULFDO�,QWHUDFWLRQ���7KH�%LEOLFDO�$IULFDQ�([SHULHQFH�´�������������&KDUOHV�&RSKHU��S��������&K�������³$IULFD�DQG�3DOHVWLQH�LQ�$QWLTXLW\�´�&KDUOHV�6��)LQFK�,,,��S��������&K�������³3HRSOLQJ�RI�WKH�)LUVW�:RUOG���6PDOO�%ODFNV�LQ�$IULFD�DQG�$VLD�´�5XQRNR�5DVKLGL�DQG�-DPHV�(��%UXQVRQ��S��������&K�������³8QH[SHFWHG�)DFHV�LQ�(DUO\�$VLD���$�3KRWR�(VVD\�´�-DPHV�(��%UXQVRQ��S��������:RQGHUIXO�(WKLRSLDQV&KDSWHUV����������DQG����S�������&KDSWHUV�������DQG����S��������&ODVV������$IULFDQ�3UHVHQFH�LQ�(DUO\�$UDELD�DQG�WKH�,VODPLF�:RUOG�RI�$VLD�&ODVV�4XHVWLRQ�±�:KDW�'LG�$IULFDQV�&RQWULEXWH�WR�WKH�'HYHORSPHQW�RI�,VODP"�5HDGLQJV$IULFDQ�3UHVHQFH&K�������³(ERQ\�DQG�%URQ]H���5DFH�DQG�(WKQLFLW\�LQ�(DUO\�$UDELD�DQG�WKH�,VODPLF�:RUNV��������������LQ�$VLD�´�:D\QH�%��&KDQGOHU��S��������&K�������³5HVHDUFK�1RWHV���$QFLHQW�&LWLHV�%HQHDWK�WKH�$UDELDQ�6DQGV�´�5XQRNR�5DVKLGL���������������S��������&K�������³7KH�$IULFDQ�3UHVHQFH�LQ�(DUO\�$UDELD�DQG�WKH�,VODPLF�:RUOG�LQ�$VLD���$�6HOHFWHG�%LEOLRJUDSK\�´�&RPSLOHG�E\�5XQRNR�5DVKLGL��S��������:KHQ�:H�5XOHG��³$UDELD�)HOL[�´�5RELQ�:DONHU��S��������:RQGHUIXO�(WKLRSLDQV��&KDSWHUV��������DQG�����3��������&KDSWHUV������DQG�����3��������&KDSWHUV��������DQG�����3��������&KDSWHUV�����3����������������

���

&ODVV������6XPHU��(ODP��0HVRSRWDPLD��0HGLD�DQG�%DE\ORQLD&ODVV�4XHVWLRQV�±�:KDW�'LG�$IULFDQV�&RQWULEXWH�WR�WKH�&RXQWULHV�:H�7RGD\�&DOO��������������������������������,UDT��,UDQ��$IJKDQLVWDQ��3DNLVWDQ"�5HDGLQJV$IULFDQ�3UHVHQFH&K�������³0RUH�/LJKW�RQ�6XPHU��(ODP�DQG�,QGLD�´�5XQRNR�5DVKLGL��S��������&K�������³7KH�%ODFNKHDGV�RI�6XPHU���$�%LEOLRJUDSK\�´�5XQRNR�5DVKLGL��S���������:KHQ�:H�5XOHG&K�������6XPHU�DQG�(ODP��S��������������������0HVRSRWDPLD�&KURQRORJ\��S���������������������6XPHU��S���������������������(ODP��S��������:RQGHUIXO�(WKLRSLDQV�±�&K���������DQG�����S���������&ODVV������,QGLD���3DUW��&ODVV�4XHVWLRQ�±�:KR�(VWDEOLVKHG�WKH�.LQJGRPV�RI�+DUUDSD�DQG�0RKHQMR�'DUR"5HDGLQJV$IULFDQ�3UHVHQFH&K������³7KH�6FULSW�RI�WKH�,QGXV�9DOOH\�&LYLOL]DWLRQ�´�:DOWHU�$��)DLUVHUYLV��-U���S������&K������³7KH�-HZHO�LQ�WKH�/RWXV���7KH�(WKLRSLDQ�3UHVHQFH�LQ�WKH�,QGXV�9DOOH\�&LYLOL]DWLRQ�´������������:D\QH�%��&KDQGOHU��S�������&K�������³5HYLHZ�(VVD\���$QFLHQW�.XVKLWH�5RRWV�LQ�,QGLD��$�6XUYH\�RI�WKH�:RUNV�RI��������������*RGIUH\�+LJJLQV��´�*HUVKRP�:LOOLDPV��S��������&K�������³0DOLN�$PEDU���$IULFD¶V�5HJHQW�0LQLVWHU�LQ�,QGLD�´�-RVHSK�(��+DUULV��S��������&K�������³5HVHDUFK�1RWH���7KH�&DVH�RI�WKH�+DEDVKLV�RI�WKH�'DNDQ�´�2PDU�.KDOLGL���������������S��������&K�������³$IULFDQ�'\QDVWLHV�LQ�,QGLD���$�6HOHFWHG�%LEOLRJUDSK\�RI�WKH�6LGGLV�´��������������5XQRNR�5DVKLGL��S���������&ODVV������,QGLD���3DUW��&ODVV�4XHVWLRQ�±�:KDW�'LG�$IULFDQV�FRQWULEXWH�WR�$QFLHQW�,QGLD"5HDGLQJV$IULFDQ�3UHVHQFH&K�������³&RPPHQWDU\���%ODFN�%RQGDJH�LQ�$VLD�´�5XQRNR�5DVKLGL��S��������&K�������³$IULFDQ�%RQGDJH�LQ�$VLDQ�/DQGV�´�*HUVKRP�:LOOLDPV��S��������&K�������³&KHLNK�$QWD�'LRS�DQG�WKH�6HDUFK�IRU�FXOWXUDO�5RRWV�RI�'DOLWV�´�9�7��5DMVKHNDU���������������S��������&K�������³7KH�%ODFN�8QWRXFKDEOHV�RI�,QGLD���5HFODLPLQJ�2XU�&XOWXUDO�+HULWDJH�´��������������9�7��5DMVKHNDU��S��������&K�������³'DOLWV���7KH�%ODFN�8QWRXFKDEOHV�RI�,QGLD�´�5XQRNR�5DVKLGL��S��������&K�������³7KH�+LVWRULFDO�8QLW\�RI�$IULFDQV�DQG�'DOLWV���$�6HOHFWHG�%LEOLRJUDSK\�´�������������5XQRNR�5DVKLGL��S��������:KHQ�:H�5XOHG&K�������³,QGXV�9DOOH\�´�S��������

���

&ODVV������&KLQD�DQG�-DSDQ&ODVV�4XHVWLRQ�±�+RZ��:KHQ��:KHUH��:K\�DQG�:KDW�'LG�$IULFDQV�&RQWULEXWH������������������������������7R�&KLQD�DQG�-DSDQ"�5HDGLQJV$IULFDQ�3UHVHQFH&K�������³7KH�$IULFDQ�3UHVHQFH�LQ�(DUO\�&KLQD�´�-DPHV�(��%UXQVRQ��S��������&K�������³%ODFN�6KRJXQ���7KH�$IULFDQ�3UHVHQFH�LQ�-DSDQHVH�$QWLTXLW\�´�-DPHV�(��%UXQVRQ��������������5XQRNR�5DVKLGL�DQG�:DOODFH�0DJVE\��S��������&K�������³7KH�%ODFN�3UHVHQFH�LQ�&ODVVLFDO�6RXWKHDVW�$VLDQ�&LYLOL]DWLRQ�´�5XQRNR�5DVKLGL��S��������&K�������³'LPLQXWLYH�$IULFRLGV���)LUVW�3HRSOH�RI�WKH�3KLOLSSLQHV�´�5XQRNR�5DVKLGL���������������S����������&ODVV������7ULEXWH�WR�WKH�3DVW&ODVV�4XHVWLRQ�±�:KR�:HUH�6RPH�RI�WKH�6FKRODUV�7KDW�:URWH�$ERXW�$IULFDQV�,Q������������������������������$VLD"�$IULFDQ�3UHVHQFH&K�������³5HVHDUFKLQJ�WKH�$IULFDQ�3UHVHQFH�LQ�$VLD���7KH�&KDOOHQJH�$KHDG�RI�8V�´�������������&KDQFHOORU�:LOOLDPV��S��������&K�������³7ULEXWH�WR�D�)RUHUXQQHU���$�6HOHFWHG�%LEOLRJUDSK\�RI�-RKQ�*ORYHU�-DFNVRQ�´��������������S��������&K�������3LRQHHU�&RQWULEXWLRQV�WR�WKH�'RFXPHQWDWLRQ�RI�WKH�$IULFDQ�3UHVHQFH�LQ�(DUO\��������������$VLD�������������´�5XQRNR�5DVKLGL�DQG�-DPHV�(��%UXQVRQ��S����������&ODVV������6SLULWXDO�)RXQGDWLRQV&ODVV�4XHVWLRQ�±�:KDW�'LG�$IULFDQV�&RQWULEXWH�7R�7KH�6SLULWXDO�)RXQGDWLRQV������������������������������2I�$VLD"�5HDGLQJV$IULFDQ�3UHVHQFH&K�������³7KH�3ULQFLSDOLW\�RI�3RODULW\�´�:D\QH�%��&KDQGOHU��S��������&K�������³%RGKLGKDUPD���)RXQGHU�DQG�)LUVW�3DWULDUFK�RI�=HQ�%XGGKLVP�´�������������:D\QH�%��&KDQGOHU��S����&K������³.ULVKQD�DQG�%XGGKD�RI�,QGLD���%ODFN�*RGV�RI�$VLD�´�-RKQ�*��-DFNVRQ��S��������

������

���

&ODVV������$IULFDQ�$UW�DQG�$UFKLWHFWXUH�LQ�(DUO\�$VLD&ODVV�4XHVWLRQ�±�:KDW�$UWLVWLF�DQG�$UFKLWHFWXUDO�(YLGHQFH�([LVWV�7KDW�6KRZ������������������������������$Q�$IULFDQ�3UHVHQFH�,Q�$VLD"�5HDGLQJV$IULFDQ�3UHVHQFH&K�������³7KH�$IULFDQ�3UHVHQFH�LQ�WKH�$UW�DQG�$UFKLWHFWXUH�RI�(DUO\�&HQWUDO�$VLD�´��������������5XQRNR�5DVKLGL�DQG�-DPHV�(��%UXQVRQ��S����&K�������³-DPHV�&RZOHV�3ULFKDUG�RQ�WKH�$IULFDQ�3UHVHQFH�LQ�$VLD�´�5XQRNR�5DVKLGL��������������S������&ODVV������7KH�*ROGHQ�$JHV�RI�:HVW�$IULFD&ODVV�4XHVWLRQ�±�:KDW�+DSSHQHG�'XULQJ�WKH�*ROGHQ�$JHV�RI�:HVW�$IULFD"�5HDGLQJV,QWUR�WR�$IULFD���-*-�±�S��������:KHQ�:H�5XOHG���5:&K�����±�³:HVW�$IULFDQ�&RDVW´�3��������&K�����±�³:HVW�$IULFDQ�*ROGHQ�$JH´�3����������&ODVV������'RJRQ�&UHDWLRQ�6WRU\�±�3DUW��&ODVV�4XHVWLRQ�±�:KDW�,V�WKH�*HRJUDSK\��+LVWRU\�DQG�3KLORVRSK\�RI�WKH�'RJRQ������������������������������2I�0DOL��:HVW�$IULFD"�5HDGLQJV6WDU�RI�'HHS�%HJLQQLQJV�±�&KDUOHV�)LQFK,QWURGXFWLRQ��&K��������DQG���±�3�[Y�[[���������&ODVV����±�'RJRQ�&UHDWLRQ�6WRU\�±�3DUW��&ODVV�4XHVWLRQ�±�:KDW�LV�WKH�$VWURQRPLFDO�DQG�$JULFXOWXUDO�,PSRUWDQFH�RI�WKH������������������������������'RJRQ�&UHDWLRQ�6WRU\"�5HDGLQJV6WDU�RI�'HHS�%HJLQQLQJV&K��������DQG���±�3��������������

���

$IULFDQV�0RRUV�LQ�(XURSH�&ODVV�����7KH�(PSLUH�RI�WKH�0RRU&ODVV�4XHVWLRQ�±�+RZ�'LG�$IULFDQV�,PSDFW�(XURSH�DQG�WKH�5HQDLVVDQFH"�5HDGLQJV,QWUR�WR�$IULFD�±�-*-�±�S��������:KHQ�:H�5XOHG���5:&K�����±�³&DUWKDJH�DQG�1XPLGLD´�±�3��������&K�����±�³&LYLOL]DWLRQ�RI�WKH�0RRUV´�±�3���������&RXUVH�'HVFULSWLRQ$IULFDQV�LQ�0HGLHYDO�(XURSH�ZLOO�LQFOXGH�H[SORUDWLRQ�RI�FRQFHSWV�LQ�$IULFDQ�DQG�(XURSHDQ�FLYLOL]DWLRQV���3UHVHQWDWLRQV�ZLOO�LQFOXGH�WKH�UHVHDUFK�RQ�VHWWOHPHQWV�DQG�VXEVHTXHQW�PRYHPHQW�RI�$IULFDQ�SHRSOH�LQWR�6RXWKHUQ�6SDLQ�LQ�����$&(�WR�WKH�GHIHDW�RI�WKH�ODVW�UHFRUGHG�$IULFDQ�UXOHU�´�%RDEGLO�´�LQ�*UDQDGD��6SDLQ�RQ�-DQXDU\�����������&RXUVH�2EMHFWLYHV

�� 'LVFXVV�WKH�RXWOLQH�RI�WKH�KLVWRU\�RI�$IULFDQ�SHRSOHV�WUDYHOLQJ�WR�0HGLHYDO�(XURSH�� 'HVFULEH�WKH�RXWOLQH�RI��(XURSH¶V�0HGLHYDO�$JH�LQ�VSHDNLQJ�DQG�ZULWLQJ�� $UWLFXODWH�DQ�XQGHUVWDQGLQJ�RI�WKH�LQWHU�UHODWLRQVKLSV�RI�WKH�KLVWRU\�RI��0HGLHYDO�

$IULFD�DQG�(XURSH�WR�WKH�KLVWRULHV�RI�RWKHU�JURXSV�LQ�WKH�$IULFD�DQG�(XURSH��� /RFDWH�PDWHULDOV�UHOHYDQW�WR�WKH�FRXUVH�LQ�OLEUDU\�GDWDEDVHV��� &ULWLTXH�ERRNV�DQG�DUWLFOHV�RUDOO\�DQG�LQ�ZULWLQJ�

�/LVW*ROGHQ�$JH�RI�WKH�0RRUV��HG��'U��,YDQ�9DQ�6HUWLPD�-RXUQDO�RI�$IULFDQ�&LYLOL]DWLRQV�/WG��,QF���9RO�����)DOO������$IULFDQ�3UHVHQFH�LQ�(DUO\�(XURSH��HG��'U��,YDQ�9DQ�6HUWLPD�-RXUQDO�RI�$IULFDQ�&LYLOL]DWLRQV�/WG��,QF���9RO����1RYHPEHU������3OHDVH�1RWH�)RU�*XLGH�WR�5HDGLQJ�$VVLJQPHQWV��$IULFDQ�3UHVHQFH�LQ�(DUO\�(XURSH� �$3((*ROGHQ�$JH�RI�WKH�0RRU� �*$0,QLWLDOV�LQ�)URQW�RI�(VVD\� �$XWKRU�RI�(VVD\���������

���

&ODVV������,QWURGXFWLRQ�2YHUYLHZ&ODVV�4XHVWLRQ�±�:KDW�DUH�WKH�H[SHFWDWLRQV�DQG�UHVSRQVLELOLWLHV����������������������������������������������������������������RI�WKLV�FODVV"�&ODVV������5DFH�DQG�2ULJLQV�RI�$IULFDQV�LQ�(DUO\�(XURSH�3DUW��&ODVV�4XHVWLRQ�±�+RZ�GLG�+XPDQ�/LIH�HPHUJH�IURP�$IULFD�DQG����������������������������������������������0LJUDWH�WR�(XURSH"�����������������������������5HDGLQJV����$3((�,96�±�³,QWURGXFWLRQ´�±�S�����&)��³5DFH�DQG�(YROXWLRQ�LQ�3UHKLVWRU\´�±�S��������&)��³7KH�(YROXWLRQ�RI�WKH�&DXFDVRLG´�±�S������/J&�³7KH�)LUVW�,QYDGHUV´�±�S���������&ODVV������2ULJLQV�RI�$IULFDQV�LQ�(XURSH�3DUW��&ODVV�4XHVWLRQ�±�+RZ�:KHUH�GLG�$IULFDQV�LQIOXHQFH�WKH�1RUWKHUQ�������������������������������5HJLRQV�RI�(XURSH"5HDGLQJV�±�$3((,96�±�³7KH�'HILQLWLRQDO�3UREOHP´�S��������(6�³%ODFNV�LQ�:HVWHUQ�(XURSH´�±�S��������'/�³$IULFDQ�3UHVHQFH�LQ�WKH�(DUO\�+LVWRU\�RI�WKH�%ULWLVK�,VOHV�DQG�6FDQGLQDYLD´��������S��������/J&�³7KH�0\VWHU\�RI�WKH�$UFWLF�7ZD´�±�S���������55��³$QFLHQW�DQG�0RGHUQ�%ULWDLQ��$�5HYLHZ´�±�S��������&,+�³%ODFNV�LQ�3UH�5HYROXWLRQDU\�5XVVLD´�S����������&ODVV������$IULFDQV�LQ�WKH�$QFLHQW�0HGLWHUUDQHDQ�,VOHV�DQG�0DLQODQG����������������0DLQODQG�*UHHFH&ODVV�4XHVWLRQ�±�:KDW�FXOWXUDO�LPSDFW�GLG�$IULFD�KDYH�RQ�WKH������������������������������0HGLWHUUDQHDQ�,VOHV�LQFOXGLQJ�*UHHFH"5HDGLQJV�±�$3((-%�³7KH�$IULFDQ�3UHVHQFH�LQ�WKH�$QFLHQW�0HGLWHUUDQHDQ�,VOHV�DQG�0DLQODQG�*UHHFH´�������3������0%�³%ODFN�$WKHQD�$IULFDQ�DQG�/HYDQWLQH�5RRWV�RI�*UHHFH´�S������-$:�³7KH�6WROHQ�/HJDF\��$�5HYLHZ��J������$*+�³%ODFNV�LQ�$QWLTXLW\´�±�S��������������

���

&ODVV������0RRUV�IURP�3UH�+LVWRU\�WR�WKH�0RRULVK�'\QDVW\�LQ����������������$O�$QGDOXVLD�&ODVV�4XHVWLRQ�±�:KR�DUH�WKH�0RRUV"�:KHUH�GLG�WKH�0RRUV�&RPH�������������������������������)URP"5HDGLQJV�±�*$0'5�±�³$IULFDQ�+HULWDJH�(WKQR�+LVWRU\�RI�WKH�0RRUV�´�S�������-&�±�³0RRULVK�&XOWXUH�%ULQJHUV�´�S�����������������������������������������&ODVV������0RRUV�LQ�0HGLHYDO�(XURSH&ODVV�4XHVWLRQ�±:KDW�LPSDFW�GLG�WKH�0RRUV�KDYH�LQ�(XURSH"5HDGLQJV�±*$0,96�±�³7KH�0RRU�LQ�$IULFD��2ULJLQV�DQG�'HILQLWLRQV�´�S����,96�±�³7KH�0RRU�LQ�(XURSH�´�S�����-(%�55�±�³7KH�0RRUV�LQ�$QWLTXLW\�´�S������-*-�±�³(PSLUH�RI�WKH�0RRUV�´�S�������&ODVV������0RRULVK�&RQWULEXWLRQV�WR�(XURSHDQ�&XOWXUH�&LYLOL]DWLRQ�&ODVV�4XHVWLRQ�±�³:KDW�FXOWXUDO�QDWLRQDO�FRQWULEXWLRQV�GLG�0RRUV�������������������������������%ULQJ�WR�(XURSH"5HDGLQJV�±��*$0:&�±�³7KH�0RRU�/LJKW�RI�(XURSH¶V�'DUN�$JH�´�S��������(6�±�³7KH�0RRUV�DQG�3RUWXJDO¶V�*OREDO�([SDQVLRQ�´�S����������&ODVV������0RRUV�LQ�/DQJXDJH�$UWV�2WKHOOR�DQG�WKH�7KUHH�0XVNHWHHUV&ODVV�4XHVWLRQ�±�:KDW�FODVVLFDO�UROH�GLG�0RRUV�SOD\�LQ�WKH�DUWV�RI�(XURSH�5XVVLD"5HDGLQJV6KDNHVSHDUH¶V�2WKHOOR�RU�DQ\�RI�$OH[DQGUH�'XPDV¶�FODVVLFV5-�±�$3((���³$IULFDQ�3UHVHQFH�LQ�6KDNHVSHDUHDQ�'UDPD�´�S��������:RUOG¶V�*UHDW�0HQ�RI�&RORU��-$�5RJHUV±�$OH[DQGUH�'XPDV�,��,,�DQG�,,,�&KHYDOLHU�6W������������������������������������������������������������������������*HRUJHV��-RDFKLP�0XUDW�,UD�$OGULGJH�&ODVV������(GXFDWLRQ�LQ�0RRULVK�$O�$QGDOXVLD&ODVV�4XHVWLRQ�±�:KDW�HGXFDWLRQDO�VWDQGDUGV�GLG�WKH�0RRUV�RI�1RUWK�$IULFD�������������������������������,QVWLWXWH�LQ�(XURSH"5HDGLQJV�±�*$0-93%�³0RRULVK�6SDLQ�$FDGHPLF�6RXUFH�DQG��)RXQGDWLRQ�IRU�7KH�5LVH�DQG�6XFFHVV�RI������������:HVWHUQ�(XURSHDQV�8QLYHUVLWLHV�,Q�7KH�0LGGOH�$JHV�´�S����������&ODVV������0RRULVK�6FLHQFH&ODVV�4XHVWLRQ�±�:KDW�VFLHQWLILF�PHWKRGV�GLG�WKH�0RRUV�&RQWULEXWH�WR�(XURSH¶V�������������������������������������������³5HQDLVVDQFH´"5HDGLQJV�±�*$0%/�6=���³&DLUR���6FLHQFH�$FDGHP\�RI�WKH�0LGGOH�$JHV�´�S��������,96�±�³7KH�(J\SWLDQ�3UHFXUVRU�WR�*UHHN�DQG�$UDE�6FLHQFH�´�S��������

���

��&ODVV������$IULFDQ�)DLWK�6\VWHPV�LQ�0HGLHYDO�(XURSH&ODVV�4XHVWLRQ�±�+RZ�GLG�$IULFDQ�)DLWK�6\VWHPV�LPSDFW�&KULVWLDQ�$QG�,VODPLF�������������������������������3KLORVRSK\�RI�(XUDVLD"5HDGLQJV�±�*$0(6��³$IULFDQ�3RSHV�´�S�������0&�±�³$IULFDQV�LQ�WKH�%LUWK�DQG�([SDQVLRQ�RI�,VODP�´�S����������&ODVV������$IULFDQ�:RPHQ�LQ�0RRULVK�(XURSH&ODVV�4XHVWLRQ�±�:KDW�UROH�GLG�$IULFDQ�:RPHQ�SOD\�LQ�(XURSH"5HDGLQJV�±�$3(((6�±�³$IULFDQ�:RPHQ�LQ�(XURSH�´�S��������'5�±�³%ODFN�0DGRQQDV�RI�(XURSH���'LIIXVLRQ�RI�WKH�$IULFDQ�,VLV�´�S����������&ODVV������0XVLF�RI�WKH�0RRUV�&ODVV�4XHVWLRQ��:KDW�LV�WKH�0RRULVK�0XVLFDO�/HJDF\�LQ�(XURSH"5HDGLQJV�±�*$0<$�0XVLF�RI�WKH�0RRUV�LQ�6SDLQ��S��������:RUOG¶V�*UHDW�0HQ�RI�&RORU��-$�5RJHUV��%HHWKRYHQ�*HRUJH�%ULGJHWRZHU�������������������������������&ODVV����±�7KH�&UXVDGHV�±�)URP�WKH���WK�&HQWXU\�8QWLO�WKH���WK�&HQWXU\���������������&ODVV�4XHVWLRQV���:KDW�+DSSHQHG�'XULQJ�WKH�&UXVDGHV�RI�WKH�0HGLHYDO�(UD"� 6HH�.DED�+LDZDWKD�.DPHQH¶V�'9'�&DWDORJ���&ROOHFWLRQ�RQ�³7KH�&UXVDGHV´ ���������������

���

$IULFDQV�LQ�(DUO\�$PHULFDV�&ODVV������$IULFD¶V�'LVFRYHU\�RI�$PHULFD&ODVV�4XHVWLRQ�±�:KDW�&XOWXUDO�,PSDFW�'LG�$IULFD�+DYH�2Q�$PHULFD"�5HDGLQJV�,QWUR�WR�$IULFD±�-*-�±�S���������&RXUVH�'HVFULSWLRQ$IULFDQV�LQ�$PHULFD�ZLOO�LQFOXGH�H[SORUDWLRQ�RI�FRQFHSWV�LQ�DQFLHQW�$IULFDQ�DQG�$PHULFDQ�FLYLOL]DWLRQV���3UHVHQWDWLRQV�RI�UHVHDUFK�RQ�RULJLQDO�$PHULFDQ�VHWWOHPHQWV�DQG�VXEVHTXHQW�PLJUDWLRQ�RI�$IULFDQ�SHRSOH�WR�WKH�:HVWHUQ�+HPLVSKHUH�GDWLQJ�EDFN�WR�WKH���WK�G\QDVW\�RI�DQFLHQW�(J\SW�������%&(��DQG�:HVW�$IULFDQ�YLVLWV�IURP�WKH�0DOLDQ�(PSLUH�������$&(�%RRN�/LVW�-DLUD]EKR\��5���$���$QFLHQW�(J\SWLDQV�LQ�0LGGOH�DQG�6RXWK�$PHULFD��������������������������������$QFLHQW�(J\SWLDQV�DQG�&KLQHVH�LQ�$PHULFD��������������������������������5DPVHV�,,,��)DWKHU�RI�$QFLHQW�$PHULFD�-RVHSK��)UDQN��7KH�/RVW�7UHDVXUH�RI�.LQJ�-XED�%HQ�-RFKDQQDQ��<RVHI��$���$���$EX�6LPEHO�±�*L]HK���$ONHEX�/DQ�%RRNV��1<��������%UDGOH\��0LFKDHO��7KH�%ODFN�'LVFRYHU\�RI�$PHULFD���3HUVRQDO�/LEUDU\��7RURQWR��������&DUUXWKHUV��-DFRE��DQG�.DUHQJD��0DXODQD��.HPHW�DQG�WKH�$IULFDQ�:RUOGYLHZ���8QLYHUVLW\�RI�6DQNRUH�3UHVV��/$���������'H/XELF]��6FKZDOOHU��5���$���7KH�7HPSOH�,Q�0DQ���,QQHU�7UDGLWLRQV��1<��������'LRS��&KHLNK��$QWD�7KH�$IULFDQ�2ULJLQ�RI�&LYLOL]DWLRQ��0\WK�RU�5HDOLW\����/DZUHQFH�+LOO�DQG�&RPSDQ\��86$��������(PPHULFK��$QGUH��$UW�%HIRUH�&ROXPEXV���6LPRQ�DQG�6FKXVWHU��1<��������.D�5H�0RQJHV��0LULDP�0D¶DW��.XVK��7KH�-HZHO�RI�1XELD��$IULFDQ�:RUOG�3UHVV��1-��������.XVK��.KDPLW��,QGXV��:KDW�7KH\�1HYHU�7DXJKW�<RX�,Q�+LVWRU\�&ODVV���/X[RU�3XEOLFDWLRQV��1<���������-DFNVRQ��-RKQ��*���,QWURGXFWLRQ�WR�$IULFDQ�&LYLOL]DWLRQV���&LWDGHO�3UHVV��1-����������9DQ�6HUWLPD��,YDQ��7KH\�&DPH�%HIRUH�&ROXPEXV���5DQGRP�+RXVH��1<��������&K������³7KH�%ODFN�.LQJV�RI�7KH���WK�'\QDVW\�´�S����������9DQ�6HUWLPD��,YDQ��(J\SW��&KLOG�RI�$IULFD��³7KH�6L[WK�1DSDWDQ�'\QDVW\�RI�.XVK�´3HJJ\�$��%URRNV�%HUWUDP��S����������9DQ�6HUWLPD��,YDQ��$IULFDQ�3UHVHQFH�LQ�(DUO\�$PHULFD��5HYLVHG����9DQ�6HUWLPD��,YDQ��1LOH�9DOOH\�&LYLOL]DWLRQ���7UDQVDFWLRQ�%RRNV��1-���������9DQ�6HUWLPD��,YDQ��%ODFN�:RPHQ�,Q�$QWLTXLW\���7UDQVDFWLRQ�%RRNV��1-���������:LOOLDPV��&KDQFHOORU��7KH�'HVWUXFWLRQ�RI�%ODFN�&LYLOL]DWLRQ���7KLUG�:RUOG�3UHVV��&KLFDJR���������9RQ�:XWKHQDX��$OH[DQGHU��8QH[SHFWHG�)DFHV�LQ�$QFLHQW�$PHULFD���&URZQ�3XEOLVKLQJ��1<���������

���

�-DLUD]EKR\��5���$���$QFLHQW�(J\SWLDQV�LQ�0LGGOH�DQG�6RXWK�$PHULFD�����������������������������������$QFLHQW�(J\SWLDQV�DQG�&KLQHVH�LQ�$PHULFD�����������������������������������5DPVHV�,,,��)DWKHU�RI�$QFLHQW�$PHULFD�-RVHSK��)UDQN��7KH�/RVW�7UHDVXUH�RI�.LQJ�-XED��7KH�(YLGHQFH�RI�$IULFDQV�LQ����$PHULFD�%HIRUH�&ROXPEXV���%HDU��&RPSDQ\��5RFKHVWHU��9HUPRQW�������������������������������������8QHDUWKLQJ�$QFLHQW�$PHULFD���1HZ�3DJH�%RRNV��1-�����������������������������������0DJD]LQHV���1DWLRQDO�*HRJUDSKLF��³'LVFRYHULQJ�7KH�1HZ�:RUOG¶V�'DWHG�:RUN�RI�0DQ�´�9RO������6HSWHPEHU�������S�����������1DWLRQDO�*HRJUDSKLF��³*UHDW�6WRQH�)DFHV�RI�WKH�0H[LFDQ�-XQJOH�´�9RO������6HSWHPEHU�������S�����������&ODVV������,QWURGXFWLRQ�2YHUYLHZ�3ULPDU\�6RXUFHV&ODVV�4XHVWLRQ�±�:KDW�5ROH�'LG�$IULFDQV�3OD\�,Q�7KH�'HYHORSPHQW�RI�WKH�$PHULFDQ������������������������������+HPLVSKHUH"��������������������������������5HDGLQJV7KH\�&DPH�%HIRUH�&ROXPEXV��9DQ�6HUWLPD�±�,QWUR�[LLL�[Y�������������������������������������������������������������������������$XWKRU¶V�1RWH�±�[YL�[YLLL$IULFDQ�3UHVHQFH�±�,QWUR�±�S�����'DZQ�9R\DJHU�±�,QWUR�±�Y�[��)RUZDUG�[L�[YLL��&ODVV������7KH�2ULJLQDO�$PHULFDQV�������������������������������5HDGLQJV$IULFDQ�3UHVHQFH�±�&K�����±³0HQ�2XW�2I�$VLD�´�5HDVVHVVPHQW�RI�WKH�*ODGZLQ�7KHRU\�´�������������������������������3��������������������������������������&K�����±�³7KH�)LUVW�$PHULFDQV�´�/HJUDQG�&OHJJ��S����������&ODVV������*HRJUDSK\�RI�$IULFD�DQG�$PHULFD&ODVV�4XHVWLRQ�±�:KDW�*HRJUDSKLFDO�)DFWRUV�3OD\HG�D�5ROH�,Q�7KH�3HRSOLQJ�2I�7KH������������������������������$PHULFDQ�+HPLVSKHUH"��5HDGLQJV$IULFDQ�3UHVHQFH�±�&K����±�³$IULFDQ�6HD�.LQJV�LQ�$PHULFD��(YLGHQFH�IURP�(DUO\�0DSV�´��������������������������������-RDQ�&RYH\��S���������'DZQ�9R\DJHU��³0DWWHU�RI�%RDWV�´S������������������������������������³%ODFN�6KLSV�RI�WKH�%URQ]H�$JH�´�S��������������

���

&ODVV������+LVWRU\�RI�WKH���WK�'\QDVW\�RI�$QFLHQW�.HPHW��(J\SW�&ODVV�4XHVWLRQ�±�:KDW�LV�WKH�+LVWRU\�RI�WKH���WK�'\QDVW\�RI�.HPHW��(J\SW�"��5HDGLQJV7KH\�&DPH�%HIRUH�&ROXPEXV��,96��&K������³7KH�%ODFN�.LQJV�RI�7KH���WK�'\QDVW\�´����������������������������������������������������������������������3���������(J\SW��&KLOG�RI�$IULFD��,96��³7KH�6L[WK�1DSDWDQ�'\QDVW\�RI�.XVK�´�����������������������������������������������3HJJ\�$��%URRNV�%HUWUDP��S���������������������&ODVV������$IULFDQ�3UHVHQFH�LQ�$QFLHQW�$PHULFD�3DUW���7KH�2OPHF�������������������1DWLRQ�&ODVV�4XHVWLRQ�±�:KDW�HYLGHQFH�H[LVWV�WKDW�WKH���WK�'\QDVW\�&DPH�WR�$PHULFD"��5HDGLQJ7KH\�&DPH�%HIRUH�&ROXPEXV��,96��&K����±�%ODFN�$IULFD�(J\SW���S���������������������������������������������������������������������&K����±�$IULFDQ�(J\SWLDQ�3UHVHQFH�LQ�$QFLHQW���������������������������������������������������������������������$PHULFD��S���������&ODVV������$IULFDQ�3UHVHQFH�LQ�$QFLHQW�$PHULFD��3DUW�������������������3K\VLFDO�(YLGHQFH&ODVV�4XHVWLRQ�±�:KDW�LV�WKH�3K\VLFDO�(YLGHQFH�RI�WKH�3UHVHQFH�RI�$IULFDQV�LQ������������������������������$PHULFD"�5HDGLQJV�8QH[SHFWHG�)DFHV�LQ�3UH�&ROXPELDQ�$PHULFD��$OH[DQGHU�9RQ�:XWKHQDX��S��������7KH�$IULFDQ�3UHVHQFH�LQ�$QFLHQW�$PHULFD��³(YLGHQFH�IURP�3K\VLFDO�$QWKURSRORJ\�´��.HLWK�-RUGDQ��S��������������������&ODVV������7KH�0RRUV�RI�1RUWK�1RUWK�:HVW�$IULFD&ODVV�4XHVWLRQ�±�:KDW�LV�WKH�+LVWRU\�RI�$IULFD�)URP����������$&("��������������������������5HDGLQJV�*ROGHQ�$JH�RI�WKH�0RRU��-*-�±�³(PSLUH�RI�WKH�0RRUV�´�S���������������

���

&ODVV������$IULFDQ�3UHVHQFH�LQ�0HGLHYDO�$PHULFD��$&(��3DUW��&ODVV�4XHVWLRQ�±�:KDW�5ROH�'LG�:HVW�$IULFD�3OD\�LQ�WKH�$PHULFDQ�+HPLVSKHUH"��5HDGLQJV$IULFDQ�3UHVHQFH�LQ�(DUO\�$PHULFD��³/HR�:HLQHU��$�3OHD�)RU�5HH[DPLQDWLRQ�´������������������������������������������������������������'DYLG�-�0�0XIIHW��S�������������������������������������������������������������������³�$������5HYLHZ�IURP�WKH�-RXUQDO��������������������������������������������������������������2I�1HJUR�+LVWRU\�´�/HR�:HLQHU��S������������������������������������������������������������������³0DQGLQJR�9R\DJHV�DFURVV�WKH�$WODQWLF�´�+DUROG������������������������������������������������������������/DZUHQFH���.RIL�:DQJDUD������������-RVHSK��)UDQN��7KH�/RVW�7UHDVXUH�RI�.LQJ�-XED��7KH�(YLGHQFH�RI�$IULFDQV�LQ����$PHULFD�%HIRUH�&ROXPEXV���%HDU��&RPSDQ\��5RFKHVWHU��9HUPRQW��������8QHDUWKLQJ�$QFLHQW�$PHULFD���1HZ�3DJH�%RRNV��1-����������&ODVV������$IULFDQ�3UHVHQFH�LQ�0HGLHYDO�$PHULFD��$'��3DUW��&ODVV�4XHVWLRQ�±�+RZ��:K\�DQG�:KHQ�'LG�:HVW�$IULFDQV�&RPH�WR�WKH�$PHULFD"��������������������������5HDGLQJV7KH\�&DPH�%HIRUH�&ROXPEXV��,YDQ�9DQ�6HUWLPD�&K����±�7KH�6HFUHW�5RXWH�IURP�*XLQHD��S������&K����±�WKH�9LVLEOH�:LWQHVVHV��S�������&K����±�7KH�0DULQHU�3ULQFH�RI�0DOL��S�������&K����±�$IULFDQV�$FURVV�WKH�6HD��S���������&ODVV������$IULFDQ�3UHVHQFH�LQ�0HGLHYDO�$PHULFD��$'��3DUW��&ODVV�4XHVWLRQ�±�:KDW�LV�WKH�3K\VLFDO�(YLGHQFH�RI�:HVW�$IULFDQV�LQ�$PHULFD"�������������������������5HDGLQJV7KH\�&DPH�%HIRUH�&ROXPEXV��,YDQ�9DQ�6HUWLPD�&K����±�$PRQJ�7KH�4XHW]DOFRDWO��S�������&K����±�0DQGLQJR�7UDGHUV�LQ�0HGLHYDO�0H[LFR��S��������'DZQ�9R\DJHU��0LFKDHO�%UDGOH\�&K����±�3ULPLWLYH�0\WKV�RI�D�6DYDJH�3HRSOH��S������&K����±�7KH�1LJHU�DQG�WKH�1LOH��S�������&K����±�7KH�3X]]OH�RI�'LIIXVLRQ��S���������������

���

&ODVV������$IULFDQ�3UHVHQFH�LQ�(DUO\�$PHULFD��6HOHFWHG�7RSLF��������������������$IULFDQV�DQG�$VLDQV�LQ�(DUO\�$PHULFD�&ODVV�4XHVWLRQ�±�:KDW�LV�WKH�&RQQHFWLRQ�$PRQJ�$IULFDQV��$VLDQV�DQG�,QGLJHQRXV������������������������������$PHULFDQV"�5HDGLQJV�����������������������$IULFDQ�3UHVHQFH�LQ�(DUO\�$PHULFD��HG���,YDQ�9DQ�6HUWLPD�±�³7UDLW�,QIOXHQFHV�LQ�0HVR�$PHULFD��7KH�$IULFDQ�$VLDQ��������������������������&RQQHFWLRQ�´�:D\QH�%��&KDQGOHU��S����������-DLUD]EKR\��5���$���$QFLHQW�(J\SWLDQV�LQ�0LGGOH�DQG�6RXWK�$PHULFD��������������������������������$QFLHQW�(J\SWLDQV�DQG�&KLQHVH�LQ�$PHULFD��������������������������������5DPVHV�,,,��)DWKHU�RI�$QFLHQW�$PHULFD��&ODVV������$IULFDQ�3UHVHQFH�LQ�(DUO\�$PHULFD��6HOHFWHG�7RSLF���������������������7KH�%RWDQ\�&RQQHFWLRQ&ODVV�4XHVWLRQ�±�:KDW�%RWDQLFDO�(YLGHQFH�H[LVWV�WKDW�&RQQHFWV�$IULFD�ZLWK������������������������������$PHULFD"�5HDGLQJV7KH\�&DPH�%HIRUH�&ROXPEXV��,YDQ�9DQ�6HUWLPD��³3ODQWV�DQG�7UDQVSODQWV�´�S����������'DZQ�9R\DJHU��³(YLGHQFH�RI�%RWDQ\�´�S�����������&ODVV������$IULFDQ�3UHVHQFH�LQ�(DUO\�$PHULFD��6HOHFWHG�7RSLF��������������������7KH�3\UDPLGV�RI�$IULFD�DQG�$PHULFD&ODVV�4XHVWLRQ�±�:KDW�DUH�WKH�6LPLODULWLHV�DQG�'LIIHUHQFHV�%HWZHHQ�WKH�3\UDPLGV�RI�����������������������������$IULFD�DQG�$PHULFD"���������������������������5HDGLQJV%ODFNV�LQ�6FLHQFH���$QFLHQW�DQG�0RGHUQ��-RXUQDO�RI�$IULFDQ�&LYLOL]DWLRQV��HG���,YDQ�9DQ��6HUWLPD��³7KH�3\UDPLGV��$QFLHQW�6KRZFDVH�RI�$QFLHQW�6FLHQFH�DQG�7HFKQRORJ\�´�S���������$IULFDQ�3UHVHQFH�LQ�(DUO\�$PHULFD��HG��,YDQ�9DQ�6HUWLPD��3\UDPLGV�$PHULFDQ�DQG�$IULFDQ���$�&RPSDULVRQ�´�%HDWULFH�/XPSNLQ��S��������������1DWLYH�5RRWV��-DFN�:HDWKHUIRUG��&K������³3\UDPLGV�$ORQJ�7KH�0LVVLVVLSSL�´��������

���

&ODVV������$IULFDQ�3UHVHQFH�LQ�(DUO\�$PHULFD��6HOHFWHG�7RSLF���������������������&XOWXUDO�3DUDOOHOV&ODVV�4XHVWLRQ�±�:KDW�$UH�6RPH�RI�WKH�&XOWXUDO�6LPLODULWLHV�DQG�'LIIHUHQFHV������������������������������%HWZHHQ�$IULFD�DQG�$PHULFD"�5HDGLQJV7KH\�&DPH�%HIRUH�&ROXPEXV��,YDQ�9DQ�6HUWLPD��&K�����±�6PRNLQJ��7REDFFR�DQG�3LSHV�LQ�$IULFD�DQG�$PHULFD��S���������&K�����±�7KH�0\VWHU\�RI�0X�ODQ�SL��S���������3RVWVFULSWV�RQ�2WKHU�)LQGV��S���������'DZQ�9R\DJHU��0LFKDHO�%UDGOH\��&K����±�3RVVLEOH�&XOWXUDO�3DUDOOHOV��S���������&K�����±�:KLWH�*RGV�DQG�/RVW�&LWLHV��S����������&K�����±�7KH�6KDUHG�$GYHQWXUH��S����������&ODVV�����6RXWKHUQ�$IULFD&ODVV�4XHVWLRQ�±�:KDW�$UH�7KH�&XOWXUDO�&RQWULEXWLRQV�0DGH�%\������������������������������������$IULFDQV�,Q�6RXWKHUQ�$IULFD"�5HDGLQJV:KHQ�:H�5XOHG�±�5:&K�����±�³6RXWKHUQ�$IULFD´�±�3��������6WDU�RI�'HHS�%HJLQQLQJV�±�&KDUOHV�)LQFK&K��������$IWHUZRUG�DQG�6SHFLDO�6HFWLRQ�±�3���������&ODVV�����&HQWUDO�$IULFD&ODVV�4XHVWLRQ���:KDW�$UH�7KH�&XOWXUDO�&RQWULEXWLRQV�0DGH�%\�$IULFDQV�,Q�����������������������������&HQWUDO�$IULFD"�5HDGLQJV:KHQ�:H�5XOHG���5:&K�����±�³7KH�&HQWUDO�6DKDUD�&ODVV������.RQJROHVH�&RVPRORJ\�±�3DUW��&ODVV�4XHVWLRQ�±�+RZ�'RHV�7KH�.RQJROHVH�&RVPRORJ\�5HIOHFW�WKH�(DUOLHVW�����������������������������7KLQNLQJ�RI�7KH�+XPDQ�)DPLO\"�5HDGLQJV$IULFDQ�&RVPRORJ\��'U��)X�.LDX�$ERXW�'U��)X�.LDX��3��������,QWURGXFWLRQ��&K����±�3������,QVHUW�&K��������������DW�WKH�WRS�RI�3����RI�&K�������

���

&ODVV����±�.RQJROHVH�&RVPRORJ\�±�3DUW��&ODVV�4XHVWLRQ�±�:KDW�'RHV�7KH�³9´�5HSUHVHQW�,Q�.RQJROHVH�&RVPRORJ\"�5HDGLQJV$IULFDQ�&RVPRORJ\��'U��)X�.LDX&K����±�3���&K����±�3�������&ODVV����±�+RZ�GLG�:H�*HW�+HUH"�DQG�:KHUH�'R�:H�*R�)URP�+HUH"&ODVV�4XHVWLRQ�±�:KDW�,V�7KH�3DVW�5RDG�7KDW�&UHDWHG�7KH�3UHVHQW�5RDG�7KDW�:LOO�������������������������������/HDG�8V�7R�7KH�)XWXUH�5RDG"�5HDGLQJV:KHQ�:H�5XOHG���5:&K����±�³6XUYH\�RI�WKH�'RFXPHQWV´�±�3������&K�����±�³7KH�)DOO�RI�$IULFD�DQG�WKH�5HVLVWDQFH´�±�3��������&K�����±�³$IWHUZRUG��:KHUH�)URP�+HUH"�±�3��������

���������

���

�������³)RUW\������6HDVRQV´7KH�3HU�$QNK�$FDGHP\$Q�,GHD�:KR¶V�7LPH�+DV�&RPH�7KH�IROORZLQJ�OLVW�RI�FODVVHV�RXWOLQH�WKH�ILUVW���VW��7HQ�&\FOHV�RI�WKH�3HU�$QNK�$FDGHP\ಬV�&XUULFXOXP�3ODQ��&\FOH���ದ�%()25(�7+(�%(*,11,1*�%(*$16HDVRQ����±�����7KHPH���³$�.HPHWLF�7KHRU\�2Q�7KH�2ULJLQ�2I�7KH�&RVPLF�8QLYHUVH´)RFXV�4XHVWLRQ�V��±�:KDW�GLG�WKH�DQFLHQW�.HPLWHV��(J\SWLDQV��HQYLVLRQ�H[LVWLQJ�EHIRUH�WKH�&RVPLF"8QLYHUVH�EHJDQ"�:KDW�EHJDQ�WKH�&RVPLF�8QLYHUVH�DW�WKDW�ILUVW�PRPHQW�RI�H[LVWHQFH"�:KDW�NHSW��NHHSV��WKLV�&RVPLF�8QLYHUVH�EHFRPLQJ"�6HDVRQ����±����7KHPH�±�³7KH�'RJRQ�3HRSOH�2I�0DOL��1RUWK�:HVW�$IULFD´)RFXV�4XHVWLRQ�V��±�:KDW�HGXFDWLRQDO�V\VWHP�GLG�WKH�'RJRQ�SHRSOH�RI�0DOL�GHYHORS�WKDW�ZRXOG�DOORZ�WKHP�WR�FUHDWH�DQ�DVWURQRPLFDO�V\VWHP�DURXQG�WKH�6LULXV�VWDU�V\VWHP"�6HDVRQ����±����7KHPH�±�³7KH�,PSDFW�2I�7KH�0RRUV�2I�1RUWK�$IULFD�2Q�:RUOG�+LVWRU\´)RFXV�4XHVWLRQ�V��±�:KDW�UROH�GLG�WKH�0RRUV�RI�1RUWK�$IULFD�SOD\�LQ�WKH�GHYHORSPHQW�RI�PRGHUQ"&LYLOL]DWLRQ"�6HDVRQ����±����7KHPH�±�³7KH�6SHFLDO�5HODWLRQVKLS�$PRQJ�WKH�6XQ��3ODQWV��DQLPDOV�DQG�+XPDQV´)RFXV�4XHVWLRQ�±�:KDW�KDSSHQV�WR�SODQWV��DQLPDOV�DQG�KXPDQV�ZKHQ�H[SRVHG�WR�VXQOLJKW"�

����

���

)RUW\�6HDVRQV��FRQW¶G��3���&\FOH���ದ�&260,&�%(*,11,1*6�6HDVRQ���±����7KHPH�±�³$�.HPHWLF�7KHRU\�2Q�7KH�2ULJLQ�2I�7KH�&RVPLF�8QLYHUVH´)RFXV�4XHVWLRQ�V��±�$IWHU�WKH�3URFHVV�RI�%HFRPLQJ�EHJDQ��KRZ�GLG�JDODFWLF��VWHOODU�DQG�SODQHWDU\�V\VWHPV������FRQWLQXH�EHFRPLQJ"�6HDVRQ���±����7KHPH�±�³7KH�6FLHQWLILF�:LVGRP�&RQWDLQHG�:LWKLQ�7KH�$WHQ�7H[W´)RFXV�4XHVWLRQ�V��±�:KDW�UROH�GLG�WKH�VXQ�SOD\�LQ�WKH�OLYHV�RI���WK�'\QDVW\������������%&(��.HPLWHV«SDUWLFXODUO\�GXULQJ�WKH�UHLJQ�RI�3KDUDRK�$NKHQDWHQ������������%&(��6HDVRQ���±����7KHPH�±�³(DUWK�6FLHQFH�$V�,W�$SSOLHV�7R�7KH�6KDEDND�7H[W´)RFXV�4XHVWLRQ�V��±�+RZ�GRHV�WKH�SKLORVRSK\�FRQWDLQHG�ZLWKLQ�WKH�DQFLHQW�6KDEDND�WH[W�SHUWDLQ�WR�FXUUHQW�JHRORJLFDO�WKHRUHPV"�6HDVRQ���±����7KHPH�±�³%LRORJLFDO�.KHP�0\VWHU\��&KHPLVWU\��$QG�2UJDQLF�+LVWRU\�2Q�*HE��(DUWK�´)RFXV�4XHVWLRQ�V��±�:KDW�LPSDFW�GRHV�FDUERQ�KDYH�RQ�WKH�GHYHORSPHQW�RI�2UJDQLF�/LIH�DQG�KRZ�LV�LW�GHVFULEHG�LQ�WKH�6KDEDND�7H[W��$XVDULDQ�'UDPD�"��&\FOH���ದ�$780,&�&216&,2861(66�6HDVRQ���±����7KHPH�±�³0D¶DW��7KH�)HDWKHUHG�:RPEHGPDQ«%DODQFH�LQ�WKH�&RVPLF�8QLYHUVH´)RFXV�4XHVWLRQ�V��±�+RZ�ZDV�-XVWLFH��%DODQFH��7UXWK�DQG�5LJKWHRXVQHVV�SRUWUD\HG�DQG�SUDFWLFHG�LQ�$QFLHQW�.HPHW��(J\SW�"�6HDVRQ����±�����7KHPH�±�³7KH�%HMHZHOHG�%UDLQ�DQG�WKH�6DFUHG�6FLHQFH�ZULWWHQ�RQ�.LQJ�7XWDQNKDPHQ¶V�6DUFRSKDJXV)RFXV�4XHVWLRQ�V��±�:KDW�WKUHH�����PDMRU�SDUWV�RI�WKH�EUDLQ�ZHUH�LGHQWLILHG�E\�DQFLHQW�.HPLWHV��(J\SWLDQV��WR�EH�UHVSRQVLEOH�IRU�PHQWDO�DQG�VSLULWXDO�DVFHQVLRQ"�6HDVRQ����±�����7KHPH�±�³3V\FKRORJLFDO�DQG�)XQFWLRQDO�&RQVFLRXVQHVV´)RFXV�4XHVWLRQ�V��±�:KDW�DUH�WKH�PHQWDO�ERXQGDULHV�RI�&UHDWHG�&RQVFLRXVQHVV"���)RUW\�6HDVRQV��FRQW¶G��3��

���

�&\FOH���ದ�67$5�%(*,11,1*6�6HDVRQ����±�����7KHPH�±�³7KH�6WDJHV�RI�,QWHOOHFWXDO�*URZWK�DQG�WKH�*UDGHV�RI�&RQVFLRXVQHVV´)RFXV�4XHVWLRQ�V��±�:KHUH�FDQ�WRGD\¶V�WKHRULHV�SHUWDLQLQJ�WR�,QWHOOHFWXDO�&RQVFLRXVQHVV�EH�IRXQG�DPRQJ�WKH�.HPLWHV��(J\SWLDQV��RI�.HPHW��(J\SW��DQG�'RJRQ�RI�0DOL��1RUWKZHVW�$IULFD"�6HDVRQ����±�����7KHPH�±�³7KH�'RJRQ�3HRSOH�RI�0DOL��1RUWKZHVW�$IULFD«$�6RFLDOO\�6FLHQWLILF�9LHZ´)RFXV�4XHVWLRQ�V��±�:KR�DUH�WKH�'RJRQ"�:KDW�LV�WKHLU�VRFLDO�VWUXFWXUH"�:KHUH�GLG�WKH\�FRPH�IURP"�+RZ�GR�WKH\�IXQFWLRQ"�:KDW�UROH�GRHV�DJULFXOWXUH�DQG�DVWURQRP\�SOD\�LQ�WKHLU�GDLO\�OLYHV"�6HDVRQ����±�����7KHPH�±�³7KH�'RJRQ�3HRSOH�RI�0DOL��1RUWKZHVW�$IULFD«$�6FLHQWLILFDOO\�6FLHQWLILF�9LHZ´)RFXV�4XHVWLRQ�V��±�:KDW�DVWURQRPLFDO�ZLVGRP�GLG�WKH�'RJRQ�SHRSOH�SRVVHVV�WKDW�DGYDQFHG�WKH�WKHRULHV�RULJLQDOO\�JHQHUDWHG�LQ�DQFLHQW�.HPHW"�6HDVRQ����±�����7KHPH�±�³5D�/LJKW«5D�%ULJKW�±�7KH�6FLHQWLILF�:LVGRP�GHYHORSHG�WKURXJK�$IULFDQ�SKLORVRSK\´)RFXV�4XHVWLRQ�V��±�:KDW�DUH�VWDUV"�+RZ�GLG�GR�VWDUV�IRUP"�'R�VWDUV�GLH"�+RZ�GLG�WKHVH�VWDUV�FUHDWH�SODQHWV�DQG�ZK\�GLG�OLIH�FRPH�WR�EH�RQ�WKH�HDUWK"�6HDVRQ����±�����7KHPH�±�³$Q�$IULFDQ�&HQWHUHG�7KHRU\�8WLOL]LQJ�DQ�$QFLHQW�.HQ\DQ�(WKLRSLDQ�&HPHWHU\�QDPHG��1DPRUDWXQJD�WKDW�2IIHUV�3RVVLEOH�5HDVRQV�:K\�WKH�3\UDPLGV�:RXOG�/DWHU�EH�%XLOW´)RFXV�4XHVWLRQ�V��±�:KDW�ZDV�LV�WKH�LPSRUWDQFH�RI�WKH�6HUSHQW�,Q�7KH�6N\��DQG�IXQHUDO�FHUHPRQLHV�DPRQJ�WKH�.RQVR�SHRSOH�RI�&HQWUDO�(DVW�$IULFD"

������)RUW\�6HDVRQV��FRQW¶G��3���

���

&\FOH���ದ�'$5.�0$77(56�6HDVRQ����±�����7KHPH����³'DUN�0DWWHUV�,Q�7KH�&RVPRV´)RFXV�4XHVWLRQ�V��±�:KDW�UROH�GRHV�³�.0:5´��.0:5���0HODQLQ��SOD\�LQ�WKH�&RVPLF�8QLYHUVH"�6HDVRQ����±�����7KHPH�±�³%ODFN�+ROHV��%ODFN�(QWUDQFH�3RLQWV��,Q�7KH�&RVPLF�:RPE´)RFXV�4XHVWLRQ�V��±�:KHUH�GR�%ODFN�+ROHV�&RPH�)URP�DQG�/HDG�7R��LQ�WKH�&RVPLF�8QLYHUVH"�6HDVRQ����±�����7KHPH�±�³&DUERQ��,WV�7UDQVPXWDWLRQ�LQWR�0HODQLQ�DQW�LWV�3K\VLFDO�DQG�0HQWDO�3URSHUWLHV´)RFXV�4XHVWLRQ�V��±�:KDW�DUH�WKH�3K\VLFDO�DQG�0HQWDO�3URSHUWLHV�RI�&DUERQ"�+RZ�GRHV�&DUERQ�EHFRPH�0HODQLQ"�:KDW�LPSDFW�'2(6�.0:5���.0:5����0HODQLQ��RQ�/LYLQJ�6\VWHPV�ZLWKLQ�+XPDQ�%HLQJV"�:KDW�DUH�WKH�9HQWULFXODU�6\VWHP��&HUHEUDO�6SLQDO�)OXLG�DQG�WKH�'HZ�RI�/LIH"��:KDW�LV�WKH�9DXOW�RI�,QLWLDWLRQ"��:KHUH�LV�WKLV�9DXOW�ORFDWHG"�6HDVRQ����±�����7KHPH�±�³&DUERQ��,WV�7UDQVPXWDWLRQ�LQWR�0HODQLQ�DQG�LWV�0HQWDO�DQG�6SLULWXDO�3URSHUWLHV´)RFXV�4XHVWLRQ�V��±�:KDW�KDSSHQV�WR�WKH�(WHUQDO�+XPDQ�6SLULW�ZKHQ�LWV�0HQWDO�7KRXJKWV�WUDQVPXWH�WKH�3K\VLFDO�%RG\"�

��

&\FOH���ದ�7+(�6$&5('�6&,(1&(6�6HDVRQ����±�����7KHPH�±�³�*UDQG�8QLILHG�7KHRUHP��7KH�8QLILFDWLRQ�RI�WKH�8QLYHUVH�DV�IRUPXODWHG�LQ�WKH�6KDEDND�6WRQH´�)RFXV�4XHVWLRQ�V��±�+RZ�DUH�WRGD\¶V�WKHRULHV�DQG�WKHRUHPV�UHODWHG�WR�WKH�6KDEDND�6WRQH"�6HDVRQ����±�����7KHPH�±�³7KH�6SLULWXDO�6FLHQFHV´)RFXV�4XHVWLRQ�V��±�:KDW�VXEMHFWV��WRSLFV�DQG�GLVFLSOLQHV�FRPSULVH�WKH�6SLULWXDO�6FLHQFHV��&RPPXQLFDWLRQ�$UWV����)RUW\�6HDVRQV��FRQW¶G��3���

���

6HDVRQ����±�����7KHPH�±�³$IULFD¶V�3KLORVRSKLFDO�)RXQGDWLRQ�LQ�:RUOG�5HOLJLRQV´)RFXV�4XHVWLRQ�V��±�:KDW�LPSDFW�GLG�$IULFD¶V�3KLORVRSK\�RQ�6SLULW��6RXO��0LQG�DQG�%RG\�KDYH�RQ�WKH�GHYHORSPHQW�RI�WKH�:RUOG¶V�0DMRU�5HOLJLRQV"�6HDVRQ����±�����7KHPH�±�³5LWXDO�DQG�&HUHPRQ\�DV�WKH�2XWZDUG�3HUIRUPDQFH�RI�ZKDW�LV�KDSSHQLQJ�,QZDUGO\«([SHULHQFH�'HPRQVWUDWLQJ�,QVSLULHQFH´)RFXV�4XHVWLRQ�V��±�:KDW�KDSSHQV�WR�WKH�(WHUQDO�+XPDQ�6SLULW�ZKHQ�LW¶V�0HQWDO�7KRXJKWV�7UDQVPXWH�WKH�3K\VLFDO�%RG\�DQG�9LEUDWH�WKH�6RXO"�&\FOH���ದ�+80$1�%(*,11,1*6�6HDVRQ����±�����7KHPH�±�³7KH�/LIH�+LVWRU\�RI�WKH�+XPDQ�)DPLO\�LQ�$IULFD´)RFXV�4XHVWLRQ�V��±�+RZ�GLG�WKH�+XPDQ�)DPLO\�FRPH�LQWR�EHLQJ�IRU�WKH�ILUVW�WLPH��.KHSHUD�6HS�7HS\��DQG�FRQWLQXH�WKLV�3URFHVV�RI�%HFRPLQJ"�6HDVRQ����±�����7KHPH�±�³7KH�/LIH�+LVWRU\�RI�WKH�+DSL��1LOH��9DOOH\´)RFXV�4XHVWLRQ�V��±�$IWHU�%LUWK�DQG�'XULQJ�*URZWK��+RZ��:KHQ�DQG�:KHUH�GLG�+XPDQLW\¶V��VW�)DPLOLHV�WUDYHO�DORQJ�DQG�SRSXODWH�WKH�+DSL�9DOOH\"�6HDVRQ����±�����7KHPH�±�³7KH�/LIH�+LVWRU\�RI�(XUDVLD��3DUW��´)RFXV�4XHVWLRQ�V��±�:KDW�UROH�GLG�$IULFD�SOD\�LQ�SHRSOLQJ�(DVWHUQ�(XUDVLD"�6HDVRQ����±�����7KHPH�±�³7KH�/LIH�+LVWRU\�RI�(XUDVLD��3DUW��´)RFXV�4XHVWLRQ�V��±�:KDW�UROH�GLG�$IULFD�SOD\�LQ�SHRSOLQJ�:HVWHUQ�(XUDVLD"�

������)RUW\�6HDVRQV��FRQW¶G��3���&\FOH���ದ�$1&,(17�&,9,/,=$7,21����

6HDVRQ����±�����7KHPH�±�³3UH�'\QDVWLF�.HPHW��(J\SW��DQG�1RUWKHDVWHUQ�$ONHEXODQ�±�:RQGHUIXO�(WKLRSLDQV�DQG�7KHLU�(DUO\�&XVKLWH�(PSLUHV�XS�XQWLO�WKH�WLPH�RI�4XVWDO��1XELD��6XGDQ�´)RFXV�4XHVWLRQ�V��±�+RZ�GLG�1RUWKHDVWHUQ�$IULFD�GHYHORS�DQFLHQW�FLYLOL]DWLRQ�V��SULRU�WR�WKH��VW�'\QDVW\�RI�DQFLHQW�.HPHW��(J\SW�"�6HDVRQ����±�����7KHPH�±�³7KH�2OG�.LQJGRP�$VWURQRPLFDO�$JULFXOWXUDO�7HFKQRORJ\�DQG�WKH�%LUWK�RI�0LUV��3\UDPLGV�´)RFXV�4XHVWLRQ�V��±�:KDW�$VWURQRPLFDO�DQG�$JULFXOWXUDO�QHHGV�DURVH�GXULQJ�WKH�2OG�.LQJGRP�WKDW�ZRXOG�EULQJ�DERXW�WKH�$JH�RI�WKH�0LUV��3\UDPLGV��LQ�.HPHW"�6HDVRQ����±�����7KHPH�±�³7KH�1XELDQ�2ULJLQ�RI�WKH�0LGGOH�DQG�1HZ�.LQJGRPV�RI�.HPHW��(J\SW�´)RFXV�4XHVWLRQ�±�:KDW�,QQHU�$IULFDQ�LQIOXHQFHV�DQG�HYHQWV�XVKHUHG�LQ�WKH�0LGGOH�DQG�1HZ�.LQJGRPV"�6HDVRQ����±�����7KHPH�±�³7KH�1XELDQ�2ULJLQV�RI�WKH�1DSDWDQ�.LQJGRP´)RFXV�4XHVWLRQ�V��±�:KDW�:RUOG�(YHQWV�RFFXUUHG�WKDW�EURXJKW�WKH�1DSDWDQ����WK��'\QDVW\�LQWR�H[LVWHQFH�DQG�ZKDW�LQIOXHQFH�GLG�WKLV�1XELDQ��6XGDQHVH��)DPLO\�KDYH�RQ�:RUOG�+LVWRU\�&\FOH���ದ�*(2*5$3+<�$1&,(17�:25/'�6HDVRQ����±�����7KHPH�±�³&RPSDVV�5RVH��*ULG�/LQHV�DQG�&RRUGLQDWHV�DV�WKH\�UHODWH�WR�WKH�$QFLHQW�:RUOG´)RFXV�4XHVWLRQ�V��±�+RZ��:KHQ��:K\�DQG�:KHUH�GLG�$IULFDQ�([SORUHUV�WUDYHO�GXULQJ�UHFRUGHG�DQFLHQW�WLPHV"�6HDVRQ����±�����7KHPH�±��³:RUOG�:LQG�6\VWHPV�DQG�2FHDQ�&XUUHQWV´)RFXV�4XHVWLRQ�V��±�+RZ�GLG�NQRZOHGJH�RI�&RPSDVV�5RVH�DQG�*ULG�/LQHV�DQG�&RRUGLQDWHV�LQ�FRQMXQFWLRQ�ZLWK�:LQG�6\VWHPV�DQG�2FHDQ�&XUUHQWV�DVVLVW�HDUO\�$IULFDQ�H[SORUHUV�LQ�WUDYHOLQJ�DURXQG�WKH�ZRUOG�GXULQJ�WKH�SDVW�������\HDUV"���)RUW\�6HDVRQV��FRQW¶G��3����6HDVRQ����±�����7KHPH�±�³%RDW�%XLOGLQJ��7UDGH�DQG�&RPPHUFH�LQ�$IULFD´

���

)RFXV�4XHVWLRQ�V��±�:KDW�ZRXOG�OHDG�$IULFDQ�SHRSOH�WR�WUDYHO�WR�YDULRXV�SDUWV�RI�WKH�ZRUOG�DQG�WUDGH�VKDUH�WKHLU�FUHDWLRQV�ZLWK�WKH�ZRUOG�FRPPXQLW\"�:KDW�UROH�GLG�QDWXUH�SOD\�LQ�WKLV�IHOORZVKLS"�6HDVRQ����±�����7KHPH�±�³�6DFUHG�6SDFH�6DFUHG�*URXQG«$V�$ERYH�6R�%HORZ´)RFXV�4XHVWLRQ�V��±�5HYLVLWLQJ�1DPRUDWXQJD«+RZ�GLG�*HRJUDSK\�DQG�$VWURQRP\�KHOS�DQFLHQW�$IULFDQV�WUDYHUVH�WKH�KHDYHQV�DQG�WKH�HDUWK"�

�&\FOH����ದ�$1&,(17�$0(5,&$�6HDVRQ����±������7KHPH�±��³7KH�2ULJLQDO�3HRSOHV�RI�WKH�$PHULFDQ�&RQWLQHQW´)RFXV�4XHVWLRQ�V��±�:KR�ZHUH�WKH�ILUVW�ZDYHV�RI�SHRSOH�ZKR�LQKDELWHG�WKH�$PHULFDQ�&RQWLQHQW"�6HDVRQ����±������7KHPH�±�³7KH�,PSRUWDQFH�RI�WKH�0LVVLVVLSSL�5LYHU�DQG�WKH�'HYHORSPHQW�RI�$QFLHQW�$PHULFDQ�&LYLOL]DWLRQ´)RFXV�4XHVWLRQ�V��±�:KDW�UROH�GLG�WKH�0LVVLVVLSSL�5LYHU�SOD\�LQ�WKH�FUHDWLRQ�RI�,QGLJHQRXV�$PHULFDQ�FLYLOL]DWLRQV"�6HDVRQ����±������7KHPH�±�³7KH�2OPHF�&LYLOL]DWLRQ�RI�$QFLHQW�$PHULFD´)RFXV�4XHVWLRQ�V��±�:KR�ZHUH�WKH�SHRSOH�RI�WKH�2OPHF�1DWLRQ�RI�0LGGOH�$PHULFD�DQG�ZKDW�DUH�WKH\�UHVSRQVLEOH�IRU�FUHDWLQJ"�6HDVRQ����±������7KHPH�±��³7KH�7HFKQRORJ\��0LUV�3\UDPLGV��7HPSOHV�DQG�7RPEV��RI�$QFLHQW�$PHULFD´)RFXV�4XHVWLRQ�V��±�:KDW�WHFKQRORJLFDO�DGYDQFHPHQWV�LPSDFWHG�WKH�SHRSOHV�RI�DQFLHQW�$PHULFD"�

�������������������������������������������

�����������������������������������.DED�+LDZDWKD�.DPHQH���������������������������������������$ND�%RRNHU�7��&ROHPDQ��-U�����������������������������������������������7HDFKHU��&RQVXOWDQW����

�������������������������������������������3URIHVVLRQDO�DQG�&XUULFXOXP�'HYHORSHU�������������������������������������������������������������(OJDU�3ODFH��$SW���'��������������������������������������������������������%URQ[��1�<�����������������������������������������������������������������3K������������������������������������������������������������������(�PDLO�.DPHQH����#DRO�FRP����������������������������������������������������)DFHERRN���.DED�.DPHQH

�������������������������������&XUULFXOXP�&DWDORJ3ULFHV�OLVWHG�DUH�IRU�LQGLYLGXDO�SXUFKDVHV��7R�SXUFKDVH�ZKROHVDOH�����FRSLHV�RI�21(�7LWOH�LV�UHTXLUHG����:KROHVDOH�3ULFH�LV�������$�.HPHWLF�7KHRU\�2Q�7KH�2ULJLQ�2I�7KH�&RVPLF�8QLYHUVH7KH�0HPSKLWH�7H[W�5HZULWWHQ�2Q�7KH�6KDEDND�6WRQH���,QWURGXFWLRQ�������������D��&RVPLF�&DOHQGDU�����E��3ULPDWH�RI�WKH�(V6HQVHV������F��6KDEDND�6WRQH�±�,QWURGXFWLRQ���3WDK¶V�5ROH�LQ�WKH�&RPLQJ�,QWR�%HLQJ�)RU�WKH�)LUVW�7LPH�����������7KH�(V6HQVHV�RI�3UH�([LVWLQJ�2UGHU�DQG�$UUDQJHPHQW�����������$�&RQYHUVDWLRQ�%HWZHHQ�'U��*DEULHO�2\LER�DQG�.DED�+LDZDWKD�.DPHQH������DND�%RRNHU�7��&ROHPDQ��-U���±�7KH�*UDQG�8QLILHG�7KHRU\�DQG�WKH�6KDEDND���������6WRQH������������$�)RXU�3DUW�6HULHV�3UHVHQWHG�DW�WKH�%ODFN�*ROG�6DFUHG�.XOWXUDO�+HDOLQJ�&HQWHU����������������+DUOHP��1�<��������������D��6KDEDND�6WRQH�±�*HRJUDSKLFDO�DQG�+LVWRULFDO�2YHUYLHZ����E��7KH�3ULPDWH�RI�WKH�(V6HQVHV����F��7KH�(V6HQVHV�RI�3UH�([LVWLQJ�2UGHU�DQG�$UUDQJHPHQW����G��(V6HQVHV�RI�2UGHU�DQG�$UUDQJHPHQW����������&DWDORJ��FRQW¶G��S������/LYH�LQ�/RQGRQ���$�7RXU�RI�WKH�%ULWLVK�0XVHXP�����7KH�5RVHWWD�6WRQH�DQG�WKH�6KDEDND�6WRQH��������������������$��.HPHWLF�7KHRU\�RQ�WKH�2ULJLQ�RI�WKH�&RVPLF�8QLYHUVH�±

���

����/LYH�LQ�+RXVWRQ��7H[DV�����������7KH�'RJRQ�1DWLRQ�RI�0DOL�±�*HRJUDSK\�+LVWRU\�6FLHQFH�$VWURQRP\���/LYH�LQ�/RQGRQ�±�7KH�'RJRQ�RI�0DOL�DQG�6LPLODULWLHV�:LWK�WKH�6KDEDND�6WRQH�±��������������7KH�'RJRQ�3HRSOH�RI�1RUWKZHVW�$IULFD�±�*HRJUDSK\�DQG�+LVWRU\������������7KH�3KLORVRSK\�RI�WKH�'RJRQ�3HRSOH�RI�0DOL������������$�7ZR�3DUW�6HULHV�3UHVHQWHG�DW�1XELDQ�+HULWDJH��������������D��7KH�'RJRQ�RI�0DOL����������*HRJUDSK\�����������+LVWRU\�������E��7KH�'RJRQ�RI�0DOL����������2YHUYLHZ������������+LJKHU�2UGHU�7KLQNLQJ�6NLOOV�0RRUV��$IULFDQV��LQ�(XURSH�����7ZR�����:RUNVKRSV�RQ�2QH�����'9'��������������D��7KH�0RRUV�LQ�0HGLHYDO�(XURSH�±�*HRJUDSK\�DQG�+LVWRU\�����E��0RRULVK�0XVLF���$�7KUHH�����3DUW�6HULHV�RQ�7KH�&UXVDGHV�������������D��$Q�2YHUYLHZ���1RY���������E��*HRJUDSK\�DQG�+LVWRU\�±�-DQ���������F��:RUOG�,PSDFW�±�0DUFK��������$�7KUHH�����3DUW�6HULHV�RQ�6H[�DQG�5DFH�ZULWWHQ�E\�-RHO�$XJXVWXV��-$��5RJHUV��������������D��6H[�DQG�5DFH�±�*HRJUDSK\�DQG�+LVWRU\�RI�WKH�0RRUV�LQ�(XURSH�±�$XJXVW���������E��6H[�DQG�5DFH�±�0RRULVK�3KLORVRSK\�±�6HSWHPEHU���������F��6H[�DQG�5DFH�±�3URPLQHQW�$IULFDQV�LQ�(XURSH�±�0D\�������������������&DWDORJ��FRQW¶G��S������

6SLULWXDOLW\����6SLULWXDOLW\�±�6DFUHG�6FLHQFH�������������$�7KUHH�����3DUW�6HULHV�������������D��$Q�2YHUYLHZ����E��7KH����/DZV�RI�0D¶DW����F��6SLULWXDO�3KLORVRSK\����$�7KUHH�����3DUW�6HULHV������������D��7KH�6HYHQ�)ROG��6HSWHQXDU\��6RXO�±�3DUW������E���7KH�6HYHQ�)ROG�6RXO�±�3DUW�����������,SHW�DW�:DVHW��*UDQG�/RGJH�RI�/X[RU��±�3DUW������F��,SHW�DW�:DVHW�±�3DUW������%ODFN�+ROHV�±�&RVPLF�DQG�(DUWKO\�:RPEV����+LGGHQ�:LVGRP�RI�WKH�%ODFN�+ROH�±�$QFLHQW�6FLHQFH�DQG�0DWKHPDWLFV�'HHS�:LWKLQ��������7KH�$IULFDQ�:RPEHGPDQ¶V�:RPE���������������'9'�6HW�±�%ODFN�+ROHV�DQG�$IULFDQ�:RPEV������������������&DWDORJ��FRQW¶G��S����0HODQLQ������'9'�6HW�±�79�,QWHUYLHZ�±�³0HODQLQ�&KURQLFOHV´��������������D��7KH�3K\VLFDO�DQG�0HQWDO�$VSHFWV�RI�0HODQLQ

���

�����E��7KH�0HQWDO�DQG�6SLULWXDO�$VSHFWV�RI�0HODQLQ���+RZ�WR�7HDFK�0HODQLQ�LQ�WKH�&ODVVURRP�±�/LYH�DW�WKH�)DPLO\�/LIH�&HQWHU�����������:KDW�LV�0HODQLQ�6HULHV"����0HODQLQ�±�,QWURGXFWLRQ�DQG�2YHUYLHZ�������������0HODQLQ�±�7KH�6XQ����'HK\GURFKROHVWURO�DQG�9LWDPLQ�'�������������0HODQLQ�±�&RVPLF�DQG�6RODU�0HODQLQ�������������0HODQLQ�±�&URVVRYHU�:RUNVKRS�±�6XQ�WR�3ODQW�3KRWRV\QWKHVLV�������������0HODQLQ�±�&URVVRYHU�:RUNVKRS�±�3ODQW�3KRWRV\QWKHVLV�WR�6NLQ�3KRWRV\QWKHVLV�����������������0HODQLQ�±�(VVHQWLDO�1RWLRQV�RI�%ODFN�6NLQ�������������0HODQLQ�±�7KH�0HODQLQ�0ROHFXOH�±�&DUERQ��7\URVLQDVH��0HODQRVRPH�DQG��������������������������0HODQRF\WH�������������0HODQLQ�±��6NLQ��WKH�%UDLQ�DQG�WKH�&HQWUDO�1HUYRXV�6\VWHP�������������0HODQLQ�±��7KH�%UDLQ�DQG�6SLULWXDOLW\�������������0HODQLQ�±��$���'LVF�����3DUW�6HULHV�RQ�1HXURPHODQLQ�������������0HODQLQ�±��7KH�6HQVRU\�DQG�(QGRFULQH�6\VWHP�������������0HODQLQ�±��$�4XHVWLRQ�RI�&RORU�±�(WKQLF�1RWLRQV�������������0HODQLQ�±��5DS�8S����/LYH«/LVWHQLQJ�DQG�6SHDNLQJ�WR�$IULFDQ�(FKRHV�����������������������������������0HODQLQ�±����'9'�6HW�±�/LYH�LQ�7RURQWR��&DQDGD���������

������������6SLULWXDOLW\�LV�8QVHHQ�6FLHQFH«6FLHQFH�LV�6HHQ�6SLULWXDOLW\�7KH�$WHQ�7H[W�±�6RODU�6FLHQFH���7KH�$WHQ�7H[W�±�,QWURGXFWLRQ�±�/LYH�DW�&LW\�&ROOHJH�RI�1HZ�<RUN��������������'9'�6HW���$WHQ�7H[W�DQG�3KRWRYROWDLFV��������������'9'�6HW�±�6DFUHG�6FLHQFH�RI�WKH�6XQ�7DSH�������������������&DWDORJ��FRQW¶G�3����.XVK�±�1RUWKHUQ�.HQ\D��6RPDOLD��'MLERXWL��(ULWUHD��(WKLRSLD��6XGDQ�DQG�(J\SW���.XVK�DQG�.HPHW������������(WKLRSLD�±�'URSSLQ¶�WKH�6FLHQFH���������

���

���$QFLHQW�$IULFDQV�([SORUH�WKH�:RUOG������������4XVWDO�±�1XELDQ�+RPH�RI�WKH��VW�'\QDVW\�RI�$QFLHQW�.HPHW��(J\SW�������������7HDFKLQJ�WKH�3\UDPLGV�WR�+LJK�6FKRRO�6WXGHQWV������������7KH���WK�DQG���WK�'\QDVWLHV�RI�$QFLHQW�.HPHW��(J\SW�������������.LQJ�7XWDQNKDPHQ¶V�7RPE��&RQVFLRXVQHVV�DQG�&RVPLF�:LVGRP����������(GXFDWLRQ������3URIHVVRU�:LOOLDP�/HR�+DQVEHUU\�±�(DUO\�3LRQHHU�LQ�WKH�$IULFDQ�6WXGLHV�3URJUDP�������/LYH�DW�$IULFDQ�(FKRHV��������������3URIHVVRU�:LOOLDP�/HR�+DQVEHUU\�±�/LIH�DW�+RZDUG�8QLYHUVLW\�LQ�WKH����������������/LYH�DW�&LW\�&ROOHJH�RI�1HZ�<RUN��������������(GXFDWLRQ�DW�WKH�&URVVURDGV�±�/LYH�DW�WKH�8QLYHUVLW\�RI�0LQQHVRWD��������������$�0RRULVK�&XUULFXOXP�±�/LVWHQLQJ�DQG�6SHDNLQJ�WR�$IULNDQ�(FKRHV��������������3URIHVVLRQDO�'HYHORSPHQW�±�$�&XUULFXOXP�RI�&RUUHFWLRQ�±�/LYH�DW�&LW\�&ROOHJH������2I�1HZ�<RUN��������������&RVPLF�$VWURQRP\�±�/LYH�DW�WKH�&KRFRODWH�)DFWRU\��������������7ULEXWH�WR�D�0DVWHU�7HDFKHU�±�3URIHVVRU�-RKQ�+HQULN�&ODUNH�±�³7HDFKLQJ�,Q�$�&LUFOH´�����������������$IULFDQ�&HQWHUHG�(GXFDWLRQ�±�/LYH�LQ�WKH�+RXVH�RI�&RQVFLRXVQHVV��������������(GXFDWLQJ�RXU�<RXWK�(QUDSWXUHG�LQ�WKH�5HG��%ODFN�DQG�*UHHQ�������������0HODQLQ�&KURQLFOHV�±�79�,QWHUYLHZ�±�(GXFDWLRQ�DQG�6FLHQFH�������������0HODQLQ�&KURQLFOHV�±�79�,QWHUYLHZ�±�(GXFDWLQJ�2XU�$IULFDQ�<RXWK�������������2ULJLQ�RI�WKH�+XPDQ�)DPLO\�LQ�$IULFD�������������7KH�*HRJUDSK\�RI�+XPDQ�2ULJLQV�DQG�0LJUDWLRQV�������������7KH�0RYHPHQW�RI�$IULFDQV�LQWR�(XU$VLD�������������'LSORPD�3OXV�+LJK�6FKRRO�±�/LYH�LQ�,QGLDQDSROLV�������������(GXFDWLRQ�)RU�(PSRZHUPHQW�±�/LYH�LQ�&ROXPEXV��2KLR���������������7ZR�����3DUW�6HULHV������'9'V�SHU�SDUW��������&DWDORJ��FRQW¶G��3���%RG\�DQG�+RXVH�2LO���$Q�$URPD�7R�/LYH�:LWK,Q³+DSL�,Q�.XVK�*ROG�,Q�%URZQ´�±�%RG\�+RXVH�2LO�������SHU�%RWWOH�

���

2UGHULQJ�,QIRUPDWLRQ3OHDVH�LQFOXGH�����IRU�6KLSSLQJ���$VDQWH�6DQD��7KDQN�<RX�3OHDVH�VHQG�3RVWDO�0RQH\�2UGHUV�LQ�WKH�8QLWHG�6WDWHV3OHDVH�VHQG�0RQH\�7UDQVIHU�2UGHUV�RXWVLGH�RI�WKH�8QLWHG�6WDWHV�3OHDVH�0DNH�0RQH\�2UGHUV�0RQH\�7UDQVIHUV�RXW�WR�.DED�+LDZDWKD�.DPHQH����(OJDU�3ODFH��$SW���'%URQ[��1<���������)RU�:RUNVKRS�(QJDJHPHQWV�±�$V�RI�-DQXDU\�����������1HZ�<RUN�&LW\�������������+RQRUDULXP�SHU�GD\��2XWVLGH�1HZ�<RUN�&LW\�ZLWKLQ�1HZ�<RUN�6WDWH���7UDQVSRUWDWLRQ��/RGJLQJ��LI�PRUH�WKDQ���GD\��SOXV�����������+RQRUDULXP�SHU�GD\��2XWVLGH�1HZ�<RUN�6WDWH�±�$LU�)DUH���7UDQVSRUWDWLRQ�([SHQVHV�±�%\�$LU����������%\�FDU�����������7UDYHO�([SHQVHV��/RGJLQJ�SOXV�����������+RQRUDULXP�SHU�GD\��2XWVLGH�WKH�8QLWHG�6WDWHV�±�$LU�7UDQVSRUWDWLRQ�����������7UDYHO�([SHQVHV��/RGJLQJ�SOXV�����������+RQRUDULXP�SHU�GD\����

���