ML21006A098

From kanterella
Jump to navigation Jump to search

Issuance of Amendment Nos. 421, 423, and 422 Revision of Licensing Basis for High Energy Line Breaks Outside of Containment (EPID L-2019-LLA-0184) (Public Version)
ML21006A098
Person / Time
Site: Oconee  Duke Energy icon.png
Issue date: 03/15/2021
From: Markley M, Shawn Williams
Plant Licensing Branch II
To: Burchfield J
Duke Energy Carolinas
Williams S
References
EPID L-2019-LLA-0184
Download: ML21006A098 (110)


Text

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21





















0DUFK





0U-(G%XUFKILHOG-U

9LFH3UHVLGHQW2FRQHH1XFOHDU6WDWLRQ

'XNH(QHUJ\\&DUROLQDV//&

5RFKHVWHU+LJKZD\\

6HQHFD6& 



68%-(&7

2&21((18&/($567$7,2181,76$1',668$1&(2)

$0(1'0(17126$1'5(5(9,6,212)/,&(16,1*%$6,6

)25+,*+(1(5*</,1(%5($.62876,'(2)&217$,10(17

(3,'///$ 



'HDU0U%XUFKILHOG



7KH861XFOHDU5HJXODWRU\\&RPPLVVLRQ 15&WKH&RPPLVVLRQ KDVLVVXHGWKHHQFORVHG

$PHQGPHQW1RWR5HQHZHG)DFLOLW\\2SHUDWLQJ/LFHQVH 5)2/ 1R'35$PHQGPHQW

1RWR5)2/1R'35DQG$PHQGPHQW1RWR5)2/1R'35IRU2FRQHH

1XFOHDU6WDWLRQ 2FRQHH 8QLWVDQGUHVSHFWLYHO\\7KHDPHQGPHQWVDUHLQUHVSRQVHWR

WKHDSSOLFDWLRQIURP'XNH(QHUJ\\&DUROLQDV//&GDWHG$XJXVWDVVXSSOHPHQWHGE\\

OHWWHUVGDWHG-XQHDQG6HSWHPEHU



7KHDPHQGPHQWVFRQVLVWRIFKDQJHVWRWKHFXUUHQWOLFHQVLQJEDVLVLQWKH8SGDWHG)LQDO6DIHW\\

$QDO\\VLV5HSRUW 8)6$5 ZLWKUHJDUGVWR+LJK(QHUJ\\/LQH%UHDNVRXWVLGHRIWKHFRQWDLQPHQW

EXLOGLQJIRU2FRQHH8QLWVDQG



7KH15&KDVGHWHUPLQHGWKDWWKHUHODWHGVDIHW\\HYDOXDWLRQ 6( FRQWDLQVSURSULHWDU\\

LQIRUPDWLRQSXUVXDQWWR7LWOHRIWKHCode of Federal Regulations 6HFWLRQ³3XEOLF

LQVSHFWLRQVH[HPSWLRQVUHTXHVWVIRUZLWKKROGLQJ'7KHSURSULHWDU\\LQIRUPDWLRQLVLQGLFDWHGE\\

WH[WHQFORVHGZLWKLQGRXEOHEUDFNHWV$FFRUGLQJO\\WKH15&VWDIIKDVDOVRSUHSDUHGDQRQ

SURSULHWDU\\SXEOLFO\\DYDLODEOHYHUVLRQRIWKH6(ZKLFKLVSURYLGHGDV(QFORVXUH7KH

SURSULHWDU\\YHUVLRQRIWKH6(LVSURYLGHGDV(QFORVXUH



$1RWLFHRI,VVXDQFHZLOOEHLQFOXGHGLQWKH&RPPLVVLRQ¶VPRQWKO\\Federal Register QRWLFH





(QFORVXUHWRWKLVOHWWHUFRQWDLQVSURSULHWDU\\LQIRUPDWLRQ:KHQVHSDUDWHGIURP

(QFORVXUHWKLVGRFXPHQWLV'(&21752//('

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21







-(%XUFKILHOG-U



,I\\RXKDYHDQ\\TXHVWLRQVSOHDVHFRQWDFWPHDW  RUE\\HPDLODW

6KDZQ:LOOLDPV#QUFJRY



6LQFHUHO\\



/RA/

6KDZQ:LOOLDPV6HQLRU3URMHFW0DQDJHU

3ODQW/LFHQVLQJ%UDQFK,,

'LYLVLRQRI2SHUDWLQJ5HDFWRU/LFHQVLQJ

2IILFHRI1XFOHDU5HDFWRU5HJXODWLRQ



'RFNHW1RV



(QFORVXUHV

 $PHQGPHQW1RWR'35

 $PHQGPHQW1RWR'35

 $PHQGPHQW1RWR'35

 6DIHW\\(YDOXDWLRQ QRQSURSULHWDU\\ 

 6DIHW\\(YDOXDWLRQ SURSULHWDU\\ 



FFZ(QFORVXUHVDQG /LVWVHUY

(QFORVXUH

'8.((1(5*<&$52/,1$6//&

'2&.(712

2&21((18&/($567$7,2181,7

$0(1'0(17725(1(:(')$&,/,7<23(5$7,1*/,&(16(

$PHQGPHQW1R

5HQHZHG/LFHQVH1R'35



7KH861XFOHDU5HJXODWRU\\&RPPLVVLRQ WKH&RPPLVVLRQ KDVIRXQGWKDW

$

7KHDSSOLFDWLRQIRUDPHQGPHQWWRWKH2FRQHH1XFOHDU6WDWLRQ8QLW WKH IDFLOLW\\ 5HQHZHG)DFLOLW\\2SHUDWLQJ/LFHQVH1R'35ILOHGE\\'XNH(QHUJ\\

&DUROLQDV//& WKHOLFHQVHH GDWHG$XJXVWDVVXSSOHPHQWHGE\\

OHWWHUVGDWHG-XQHDQG6HSWHPEHUFRPSOLHVZLWKWKHVWDQGDUGVDQG UHTXLUHPHQWVRIWKH$WRPLF(QHUJ\\$FWRIDVDPHQGHG WKH$FW DQGWKH

&RPPLVVLRQ¶VUXOHVDQGUHJXODWLRQVVHWIRUWKLQ&)5&KDSWHU,

%

7KHIDFLOLW\\ZLOORSHUDWHLQFRQIRUPLW\\ZLWKWKHDSSOLFDWLRQWKHSURYLVLRQVRIWKH

$FWDQGWKHUXOHVDQGUHJXODWLRQVRIWKH&RPPLVVLRQ

&

7KHUHLVUHDVRQDEOHDVVXUDQFH L WKDWWKHDFWLYLWLHVDXWKRUL]HGE\\WKLV DPHQGPHQWFDQEHFRQGXFWHGZLWKRXWHQGDQJHULQJWKHKHDOWKDQGVDIHW\\RIWKH SXEOLFDQG LL WKDWVXFKDFWLYLWLHVZLOOEHFRQGXFWHGLQFRPSOLDQFHZLWKWKH

&RPPLVVLRQ¶VUHJXODWLRQV

'

7KHLVVXDQFHRIWKLVDPHQGPHQWZLOOQRWEHLQLPLFDOWRWKHFRPPRQGHIHQVHDQG VHFXULW\\RUWRWKHKHDOWKDQGVDIHW\\RIWKHSXEOLFDQG

(

7KHLVVXDQFHRIWKLVDPHQGPHQWLVLQDFFRUGDQFHZLWK&)53DUWRIWKH

&RPPLVVLRQ¶VUHJXODWLRQVDQGDOODSSOLFDEOHUHTXLUHPHQWVKDYHEHHQVDWLVILHG

 



$FFRUGLQJO\\E\\$PHQGPHQW1R5HQHZHG)DFLOLW\\2SHUDWLQJ/LFHQVH1R'35

LVKHUHE\\DPHQGHGWRDXWKRUL]HUHYLVLRQWRWKH8SGDWHG)LQDO6DIHW\\$QDO\\VLV5HSRUW

8)6$5 DVVHWIRUWKLQWKHDSSOLFDWLRQGDWHG$XJXVWDVVXSSOHPHQWHGE\\

OHWWHUVGDWHG-XQHDQG6HSWHPEHU7KHOLFHQVHHVKDOOXSGDWHWKH8)6$5WR LQFRUSRUDWHWKHFKDQJHVDVGHVFULEHGLQWKHDSSOLFDWLRQVXSSOHPHQWVDQGWKH15&

VWDII¶VVDIHW\\HYDOXDWLRQDWWDFKHGWRWKLVDPHQGPHQWDQGVKDOOVXEPLWWKHUHYLVHG GHVFULSWLRQDXWKRUL]HGE\\WKLVDPHQGPHQWZLWKWKHQH[WXSGDWHRIWKH8)6$5



7KLVOLFHQVHDPHQGPHQWLVHIIHFWLYHDVRIWKHGDWHRILWVLVVXDQFHDQGVKDOOEH LPSOHPHQWHGE\\WKHFRPSOHWLRQRIUHIXHOLQJRXWDJH(& IDOO 7KH 8)6$5FKDQJHVVKDOOEHLPSOHPHQWHGLQWKHQH[WSHULRGLFXSGDWHWRWKH8)6$5 LQDFFRUGDQFHZLWK&)5 H 

)257+(18&/($55(*8/$725<&200,66,21

5$

0LFKDHO70DUNOH\\&KLHI

3ODQW/LFHQVLQJ%UDQFK,,

'LYLVLRQRI2SHUDWLQJ5HDFWRU/LFHQVLQJ

2IILFHRI1XFOHDU5HDFWRU5HJXODWLRQ

'DWHRI,VVXDQFH0DUFK

(QFORVXUH

'8.((1(5*<&$52/,1$6//&

'2&.(712

2&21((18&/($567$7,2181,7

$0(1'0(17725(1(:(')$&,/,7<23(5$7,1*/,&(16(

$PHQGPHQW1R

5HQHZHG/LFHQVH1R'35



7KH861XFOHDU5HJXODWRU\\&RPPLVVLRQ WKH&RPPLVVLRQ KDVIRXQGWKDW

$

7KHDSSOLFDWLRQIRUDPHQGPHQWWRWKH2FRQHH1XFOHDU6WDWLRQ8QLW WKH IDFLOLW\\ 5HQHZHG)DFLOLW\\2SHUDWLQJ/LFHQVH1R'35ILOHGE\\'XNH(QHUJ\\

&DUROLQDV//& WKHOLFHQVHH GDWHG$XJXVWDVVXSSOHPHQWHGE\\

OHWWHUVGDWHG-XQHDQG6HSWHPEHUFRPSOLHVZLWKWKHVWDQGDUGVDQG UHTXLUHPHQWVRIWKH$WRPLF(QHUJ\\$FWRIDVDPHQGHG WKH$FW DQGWKH

&RPPLVVLRQ¶VUXOHVDQGUHJXODWLRQVVHWIRUWKLQ&)5&KDSWHU,

%

7KHIDFLOLW\\ZLOORSHUDWHLQFRQIRUPLW\\ZLWKWKHDSSOLFDWLRQWKHSURYLVLRQVRIWKH

$FWDQGWKHUXOHVDQGUHJXODWLRQVRIWKH&RPPLVVLRQ

&

7KHUHLVUHDVRQDEOHDVVXUDQFH L WKDWWKHDFWLYLWLHVDXWKRUL]HGE\\WKLV DPHQGPHQWFDQEHFRQGXFWHGZLWKRXWHQGDQJHULQJWKHKHDOWKDQGVDIHW\\RIWKH SXEOLFDQG LL WKDWVXFKDFWLYLWLHVZLOOEHFRQGXFWHGLQFRPSOLDQFHZLWKWKH

&RPPLVVLRQ¶VUHJXODWLRQV

'

7KHLVVXDQFHRIWKLVDPHQGPHQWZLOOQRWEHLQLPLFDOWRWKHFRPPRQGHIHQVHDQG VHFXULW\\RUWRWKHKHDOWKDQGVDIHW\\RIWKHSXEOLFDQG

(

7KHLVVXDQFHRIWKLVDPHQGPHQWLVLQDFFRUGDQFHZLWK&)53DUWRIWKH

&RPPLVVLRQ¶VUHJXODWLRQVDQGDOODSSOLFDEOHUHTXLUHPHQWVKDYHEHHQVDWLVILHG

 



$FFRUGLQJO\\E\\$PHQGPHQW1R5HQHZHG)DFLOLW\\2SHUDWLQJ/LFHQVH1R'35

LVKHUHE\\DPHQGHGWRDXWKRUL]HUHYLVLRQWRWKH8SGDWHG)LQDO6DIHW\\$QDO\\VLV5HSRUW

8)6$5 DVVHWIRUWKLQWKHDSSOLFDWLRQGDWHG$XJXVWDVVXSSOHPHQWHGE\\

OHWWHUVGDWHG-XQHDQG6HSWHPEHU7KHOLFHQVHHVKDOOXSGDWHWKH8)6$5WR LQFRUSRUDWHWKHFKDQJHVDVGHVFULEHGLQWKHDSSOLFDWLRQVXSSOHPHQWVDQGWKH15&

VWDII¶VVDIHW\\HYDOXDWLRQDWWDFKHGWRWKLVDPHQGPHQWDQGVKDOOVXEPLWWKHUHYLVHG GHVFULSWLRQDXWKRUL]HGE\\WKLVDPHQGPHQWZLWKWKHQH[WXSGDWHRIWKH8)6$5



7KLVOLFHQVHDPHQGPHQWLVHIIHFWLYHDVRIWKHGDWHRILWVLVVXDQFHDQGVKDOOEH LPSOHPHQWHGE\\WKHFRPSOHWLRQRIUHIXHOLQJRXWDJH(& IDOO 7KH 8)6$5FKDQJHVVKDOOEHLPSOHPHQWHGLQWKHQH[WSHULRGLFXSGDWHWRWKH8)6$5 LQDFFRUGDQFHZLWK&)5 H 

)257+(18&/($55(*8/$725<&200,66,21

5$

0LFKDHO70DUNOH\\&KLHI

3ODQW/LFHQVLQJ%UDQFK,,

'LYLVLRQRI2SHUDWLQJ5HDFWRU/LFHQVLQJ

2IILFHRI1XFOHDU5HDFWRU5HJXODWLRQ

'DWHRI,VVXDQFH0DUFK

(QFORVXUH

'8.((1(5*<&$52/,1$6//&

'2&.(712

2&21((18&/($567$7,2181,7

$0(1'0(17725(1(:(')$&,/,7<23(5$7,1*/,&(16(

$PHQGPHQW1R

5HQHZHG/LFHQVH1R'35



7KH861XFOHDU5HJXODWRU\\&RPPLVVLRQ WKH&RPPLVVLRQ KDVIRXQGWKDW

$

7KHDSSOLFDWLRQIRUDPHQGPHQWWRWKH2FRQHH1XFOHDU6WDWLRQ8QLW WKH IDFLOLW\\ 5HQHZHG)DFLOLW\\2SHUDWLQJ/LFHQVH1R'35ILOHGE\\'XNH(QHUJ\\

&DUROLQDV//& WKHOLFHQVHH GDWHG$XJXVWDVVXSSOHPHQWHGE\\

OHWWHUVGDWHG-XQHDQG6HSWHPEHUFRPSOLHVZLWKWKHVWDQGDUGVDQG UHTXLUHPHQWVRIWKH$WRPLF(QHUJ\\$FWRIDVDPHQGHG WKH$FW DQGWKH

&RPPLVVLRQ¶VUXOHVDQGUHJXODWLRQVVHWIRUWKLQ&)5&KDSWHU,

%

7KHIDFLOLW\\ZLOORSHUDWHLQFRQIRUPLW\\ZLWKWKHDSSOLFDWLRQWKHSURYLVLRQVRIWKH

$FWDQGWKHUXOHVDQGUHJXODWLRQVRIWKH&RPPLVVLRQ

&

7KHUHLVUHDVRQDEOHDVVXUDQFH L WKDWWKHDFWLYLWLHVDXWKRUL]HGE\\WKLV DPHQGPHQWFDQEHFRQGXFWHGZLWKRXWHQGDQJHULQJWKHKHDOWKDQGVDIHW\\RIWKH SXEOLFDQG LL WKDWVXFKDFWLYLWLHVZLOOEHFRQGXFWHGLQFRPSOLDQFHZLWKWKH

&RPPLVVLRQ¶VUHJXODWLRQV

'

7KHLVVXDQFHRIWKLVDPHQGPHQWZLOOQRWEHLQLPLFDOWRWKHFRPPRQGHIHQVHDQG VHFXULW\\RUWRWKHKHDOWKDQGVDIHW\\RIWKHSXEOLFDQG

(

7KHLVVXDQFHRIWKLVDPHQGPHQWLVLQDFFRUGDQFHZLWK&)53DUWRIWKH

&RPPLVVLRQ¶VUHJXODWLRQVDQGDOODSSOLFDEOHUHTXLUHPHQWVKDYHEHHQVDWLVILHG

 



$FFRUGLQJO\\E\\$PHQGPHQW1R5HQHZHG)DFLOLW\\2SHUDWLQJ/LFHQVH1R'35

LVKHUHE\\DPHQGHGWRDXWKRUL]HUHYLVLRQWRWKH8SGDWHG)LQDO6DIHW\\$QDO\\VLV5HSRUW

8)6$5 DVVHWIRUWKLQWKHDSSOLFDWLRQGDWHG$XJXVWDVVXSSOHPHQWHGE\\

OHWWHUVGDWHG-XQHDQG6HSWHPEHU7KHOLFHQVHHVKDOOXSGDWHWKH8)6$5WR LQFRUSRUDWHWKHFKDQJHVDVGHVFULEHGLQWKHDSSOLFDWLRQVXSSOHPHQWVDQGWKH15&

VWDII¶VVDIHW\\HYDOXDWLRQDWWDFKHGWRWKLVDPHQGPHQWDQGVKDOOVXEPLWWKHUHYLVHG GHVFULSWLRQDXWKRUL]HGE\\WKLVDPHQGPHQWZLWKWKHQH[WXSGDWHRIWKH8)6$5



7KLVOLFHQVHDPHQGPHQWLVHIIHFWLYHDVRIWKHGDWHRILWVLVVXDQFHDQGVKDOOEH LPSOHPHQWHGE\\WKHFRPSOHWLRQRIUHIXHOLQJRXWDJH(& VSULQJ 7KH 8)6$5FKDQJHVVKDOOEHLPSOHPHQWHGLQWKHQH[WSHULRGLFXSGDWHWRWKH8)6$5 LQDFFRUGDQFHZLWK&)5 H 

)257+(18&/($55(*8/$725<&200,66,21

5$

0LFKDHO70DUNOH\\&KLHI

3ODQW/LFHQVLQJ%UDQFK,,

'LYLVLRQRI2SHUDWLQJ5HDFWRU/LFHQVLQJ

2IILFHRI1XFOHDU5HDFWRU5HJXODWLRQ

'DWHRI,VVXDQFH0DUFK





















(1&/2685(



12135235,(7$5<6$)(7<(9$/8$7,21)25



$0(1'0(1712725(1(:(')$&,/,7<23(5$7,1*/,&(16(12'35



$0(1'0(1712725(1(:(')$&,/,7<23(5$7,1*/,&(16(12'35



$0(1'0(1712725(1(:(')$&,/,7<23(5$7,1*/,&(16(12'35



'8.((1(5*<&$52/,1$6//&



2&21((18&/($567$7,2181,76$1'



'2&.(7126$1'





































3URSULHWDU\\LQIRUPDWLRQSXUVXDQWWR6HFWLRQRI7LWOHRI

WKHCode of Federal Regulations KDVEHHQUHGDFWHGIURPWKLVGRFXPHQW



5HGDFWHGLQIRUPDWLRQLVLGHQWLILHGE\\EODQNVSDFHHQFORVHGZLWKLQ>>GRXEOHEUDFNHWV@@

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











7DEOHRI&RQWHQWV

,1752'8&7,21

5(*8/$725<(9$/8$7,21

%DFNJURXQG

6\\VWHP'HVLJQDQG2SHUDWLRQ

1RUPDO3ODQW6\\VWHPV

3URWHFWHG6HUYLFH:DWHU6\\VWHP

6WDQGE\\6KXWGRZQ)DFLOLW\\

'HVFULSWLRQRIWKH3URSRVHG&KDQJHV

3URSRVHG8)6$5&KDQJHV

5HJXODWRU\\5HTXLUHPHQWVDQG*XLGDQFH'RFXPHQWV

7(&+1,&$/(9$/8$7,21

5HYLVHG+(/%6WUDWHJ\\

,GHQWLILFDWLRQRI+LJK(QHUJ\\6\\VWHPV



,GHQWLILFDWLRQRI+(/%,QWHUDFWLRQ=RQHVDQG/RFDWLRQV



'HWHUPLQDWLRQRIWKH(TXLSPHQWDQG6\\VWHPVWR0LWLJDWH3RVWXODWHG

+(/%V



,GHQWLILFDWLRQRIWKH7DUJHWVRI(DFK3RVWXODWHG+(/%



'HWHUPLQDWLRQRIWKH6KXWGRZQ(TXLSPHQW8QGDPDJHGE\\WKH

3RVWXODWHG+(/%

,QVSHFWLRQ3URJUDP

15&6WDII&RQFOXVLRQ5HJDUGLQJ+(/%0LWLJDWLRQ6WUDWHJ\\

 7KHUPDO +\\GUDXOLF $QDO\\VLV   

  +(/% 0LWLJDWLRQ $FFHSWDQFH &ULWHULD    

  7+ $QDO\\VLV 0HWKRGRORJ\\ IRU 0)': DQG 06 +(/%V    

   7+ $QDO\\VLV 0HWKRGRORJLHV IRU 06 +(/%V   

  7+ $QDO\\VLV RI 0)': +(/% 6FHQDULRV    

7+$QDO\\VLVIRU06+(/%6FHQDULRV

 +XPDQ )DFWRUV   

  (YDOXDWLRQ RI 2SHUDWRU $FWLRQV   

  3URFHGXUH 'HYHORSPHQW   

7UDLQLQJ3URJUDP'HYHORSPHQW

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21













67$7(&2168/7$7,21



(19,5210(17$/&216,'(5$7,21



&21&/86,21



5()(5(1&(6

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

















6$)(7<(9$/8$7,21%<7+(2)),&(2)18&/($55($&7255(*8/$7,21)25



$0(1'0(1712725(1(:(')$&,/,7<23(5$7,1*/,&(16(12'35



$0(1'0(1712725(1(:(')$&,/,7<23(5$7,1*/,&(16(12'35



$0(1'0(1712725(1(:(')$&,/,7<23(5$7,1*/,&(16(12'35



'8.((1(5*<&$52/,1$6//&



2&21((18&/($567$7,2181,76$1'



'2&.(7126$1'









,1752'8&7,21



%\\DSSOLFDWLRQGDWHG$XJXVW 5HIHUHQFH DVVXSSOHPHQWHGE\\OHWWHUVGDWHG-XQH

5HIHUHQFH DQG6HSWHPEHU 5HIHUHQFH 'XNH(QHUJ\\&DUROLQDV//& 'XNH

(QHUJ\\WKHOLFHQVHH UHTXHVWHGFKDQJHVWRWKH8SGDWHG)LQDO6DIHW\\$QDO\\VLV5HSRUW 8)6$5 

IRUWKH2FRQHH1XFOHDU6WDWLRQ 2FRQHH216 8QLWVDQG6SHFLILFDOO\\WKHOLFHQVHH

SURSRVHGFKDQJHVWKDWZRXOGUHYLVHWKHFXUUHQWOLFHQVLQJEDVLVLQWKH8)6$5ZLWKUHJDUGWR

+LJK(QHUJ\\/LQH%UHDNV +(/%V RXWVLGHRIWKHFRQWDLQPHQWEXLOGLQJIRU2FRQHH8QLWV

DQG



7KHOLFHQVHH¶VOLFHQVHDPHQGPHQWUHTXHVW /$5 DQGVXSSOHPHQWVVXSHUVHGHLQLWVHQWLUHW\\

SUHYLRXV+(/%OLFHQVHDPHQGPHQWUHTXHVWVLQFOXGLQJUHVSRQVHVWRUHTXHVWVIRUDGGLWLRQDO

LQIRUPDWLRQ 5$, WRWKH861XFOHDU5HJXODWRU\\&RPPLVVLRQ 15&WKH&RPPLVVLRQ 7KHVH

SULRUVXEPLWWDOVRILQIRUPDWLRQZHUHSURYLGHGWRWKH15&LQOHWWHUVGDWHG1RYHPEHU

5HIHUHQFH -XQH 5HIHUHQFH 'HFHPEHU 5HIHUHQFH -XQH

5HIHUHQFH 6HSWHPEHU 5HIHUHQFH 2FWREHU 5HIHUHQFH -XQH

 5HIHUHQFH $XJXVW 5HIHUHQFH 'HFHPEHU 5HIHUHQFH 

'HFHPEHU 5HIHUHQFH -DQXDU\\ 5HIHUHQFH DQG0DUFK

5HIHUHQFH 6RPHRIWKHVXSHUVHGHGGRFXPHQWDWLRQFRQWDLQVLQIRUPDWLRQQRWDSSOLFDEOHWR

WKLVUHYLHZEXWWKDWFRQWLQXHVWRSHUWDLQWRRWKHUOLFHQVLQJDFWLRQV$GGLWLRQDOO\\WKHDSSOLFDWLRQ

GDWHG$XJXVWFRQWDLQVGLVFXVVLRQVRISDVWFRPPLWPHQWVUHODWHGWR+(/%VWKDWH[LVW

RUKDYHEHHQFORVHG+RZHYHUWKHVHSDVWFRPPLWPHQWVDUHRXWVLGHWKHVFRSHRIWKHFXUUHQW

DSSOLFDWLRQUHYLHZ7KHUHIRUHDSSURYDORIWKLVDSSOLFDWLRQGRHVQRWFRQVWLWXWH15&DFFHSWDQFH

RUFRPSOHWLRQRIWKHFORVXUHRIDQ\\UHIHUHQFHGSDVWFRPPLWPHQWV

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











)URP)HEUXDU\\WR0D\\WKH15&VWDIIFRQGXFWHGDQDXGLWWRVXSSRUWLWVUHYLHZRI

WKHDPHQGPHQWUHTXHVWDVGLVFXVVHGLQWKH15&VWDII¶VDXGLWSODQGDWHG)HEUXDU\\

5HIHUHQFH DQGDXGLWVXPPDU\\GDWHG1RYHPEHU 5HIHUHQFH 

2Q6HSWHPEHUWKH15&VWDIISXEOLVKHGDSURSRVHGQRVLJQLILFDQWKD]DUGV

FRQVLGHUDWLRQ 16+& GHWHUPLQDWLRQLQWKHFederal Register )5 IRUWKHSURSRVHG

DPHQGPHQWVWKDWLQFOXGHGWKHVXEPLWWDOGDWHG$XJXVWDQGWKHVXSSOHPHQWDOOHWWHU

GDWHG-XQH7KHVXSSOHPHQWDOOHWWHUGDWHG6HSWHPEHUSURYLGHGDGGLWLRQDO

LQIRUPDWLRQWKDWFODULILHGWKHDSSOLFDWLRQGLGQRWH[SDQGWKHVFRSHRIWKHDSSOLFDWLRQDVQRWLFHG

DQGGLGQRWFKDQJHWKH15&VWDII¶VSURSRVHG16+&GHWHUPLQDWLRQDVSXEOLVKHGLQWKHFederal Register



7KH15&VWDII¶VVDIHW\\HYDOXDWLRQ 6( FRQWDLQVSURSULHWDU\\LQIRUPDWLRQDVRULJLQDOO\\VXEPLWWHG

LQWKHOHWWHUGDWHG$XJXVWDVVXSSOHPHQWHGE\\OHWWHUVGDWHG-XQHDQG

6HSWHPEHU3URSULHWDU\\LQIRUPDWLRQZLWKKHOGXQGHU7LWOHRIWKHCode of Federal Regulations 6HFWLRQLVLGHQWLILHGE\\WH[WHQFORVHGZLWKLQGRXEOHEUDFNHWVDVVKRZQKHUH

>>

@@





5(*8/$725<(9$/8$7,21





%DFNJURXQG



2FRQHHSUHGDWHVWKH15&*HQHUDO'HVLJQ&ULWHULD *'& DQGWKHSODQWZDVOLFHQVHGWR

SULQFLSDOGHVLJQFULWHULDGHULYHGIURPWKHGUDIW$WRPLF(QHUJ\\&RPPLVVLRQ $(& 'HVLJQ&ULWHULD

SXEOLVKHGLQWKHFederal Register RQ-XO\\ )5 7KH*'&WKDWFRQVWLWXWHWKH

SULQFLSDOGHVLJQFULWHULDIRU2FRQHHDUHWKRVHGHVFULEHGLQWKH8SGDWHG)LQDO6DIHW\\$QDO\\VLV

5HSRUW5HYLVLRQ 8)6$5  5HIHUHQFH &KDSWHUDQGLQDSSOLFDEOH8)6$5VHFWLRQV

7KHVH*'&HVWDEOLVKWKHQHFHVVDU\\GHVLJQIDEULFDWLRQFRQVWUXFWLRQWHVWLQJDQGSHUIRUPDQFH

UHTXLUHPHQWVIRUVWUXFWXUHVV\\VWHPVDQGFRPSRQHQWV 66&V LPSRUWDQWWRVDIHW\\WKDWLV66&V

WKDWSURYLGHUHDVRQDEOHDVVXUDQFHWKDWWKHIDFLOLW\\FDQEHRSHUDWHGZLWKRXWXQGXHULVNWRWKH

KHDOWKDQGVDIHW\\RIWKHSXEOLF



7KH*LDPEXVVROHWWHU 5HIHUHQFH DVPRGLILHGE\\WKH6FKZHQFHUOHWWHU 5HIHUHQFH 

SURYLGHGDOLVWRIUHTXHVWHGLQIRUPDWLRQWKDWZRXOGGHPRQVWUDWHZLWKUHDVRQDEOHDVVXUDQFHWKDW

WKHSODQWFRXOGEHVDIHO\\VKXWGRZQDQGPDLQWDLQHGLQDVDIHVKXWGRZQFRQGLWLRQIROORZLQJ

FUHGLEOHIDLOXUHVRISLSLQJLQKLJKHQHUJ\\V\\VWHPV



,QUHVSRQVHWRWKH*LDPEXVVR6FKZHQFHUOHWWHUVWKHOLFHQVHHRULJLQDOO\\GRFXPHQWHGLWV

DQDO\\VHVRIWKHG\\QDPLFHIIHFWVUHVXOWLQJIURPSRVWXODWHGSLSLQJEUHDNVRXWVLGHRIWKH

FRQWDLQPHQWEXLOGLQJLQ'XNH(QHUJ\\PHFKDQLFDOGHVLJQVWXG\\ 0'6 5HSRUW1R26

GDWHG$SULO 5HIHUHQFH DQGVXSSOHPHQWVGDWHG-XQH 5HIHUHQFH DQG

0DUFK 5HIHUHQFH ,QJDSVLQGRFXPHQWDWLRQZLWKWKLVRULJLQDO+(/%

DQDO\\VLVZHUHLGHQWLILHGDQG'XNH(QHUJ\\EHJDQDSURMHFWWRXSGDWHWKHRULJLQDO+(/%ZRUN

'XNH(QHUJ\\VXEPLWWHGWRWKH15&SURSRVHGPLWLJDWLRQVWUDWHJLHVDQGUHJXODWRU\\FRPPLWPHQWV

IRUUHVROXWLRQRILVVXHVUHODWHGWR+(/%VRXWVLGHRIFRQWDLQPHQWRQ1RYHPEHU%\\

OHWWHUGDWHG-XQH'XNH(QHUJ\\VXEPLWWHGDOLFHQVHDPHQGPHQWUHTXHVWWRUHYLVHWKH

2FRQHHOLFHQVLQJEDVLVIRU+(/%PLWLJDWLRQ6XEVHTXHQWO\\'XNH(QHUJ\\VXEPLWWHGXSGDWHG

+(/%PLWLJDWLRQVWUDWHJLHVDQGUHJXODWRU\\FRPPLWPHQWVE\\OHWWHUGDWHG1RYHPEHU

5HIHUHQFH 7KHFXUUHQWSURSRVHGOLFHQVHDPHQGPHQWUHTXHVWVXSHUVHGHVWKHOLFHQVH

DPHQGPHQWUHTXHVWGDWHG-XQHDQGUHODWHGFRUUHVSRQGHQFH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











,QLWV/$5WKHOLFHQVHHUHTXHVWHGWRHVWDEOLVKQRUPDOSODQWV\\VWHPVSURWHFWHGVHUYLFHZDWHU

36: V\\VWHPDQGRUVKXWGRZQVWDQGE\\IDFLOLW\\ 66) DVWKHDVVXUHGPLWLJDWLRQSDWKIROORZLQJ

D+(/%6SHFLILFDOO\\WKHOLFHQVHHSURSRVHGWKHIROORZLQJFKDQJHVIRU+(/%PLWLJDWLRQEDVHG

RQWKHORFDWLRQRIWKHSLSLQJEUHDN



 &UHGLWLQJWKH36:V\\VWHPRU66)IRU+(/%PLWLJDWLRQZKHQD+(/%UHVXOWVLQWKH

ORVVRISODQWV\\VWHPVQHHGHGIRUVDIHVKXWGRZQ 66' LQVLGHWKHWXUELQHEXLOGLQJ

7% 



 &UHGLWLQJQRUPDOSODQWV\\VWHPV LHKLJKSUHVVXUHLQMHFWLRQ +3, DQGHPHUJHQF\\

IHHGZDWHU (): RUWKH66)IRU+(/%PLWLJDWLRQZKHQD+(/%UHVXOWVLQWKHORVVRI

SODQWV\\VWHPVQHHGHGIRU66'LQVLGHWKHDX[LOLDU\\EXLOGLQJ $% 



 &UHGLWLQJQRUPDOSODQWV\\VWHPVIRU+(/%PLWLJDWLRQZKHQD+(/%RFFXUVRXWVLGHRI

WKH7%DQG$%



 8)6$5UHYLVLRQVWKDWZLOOLQFRUSRUDWHWKH+(/%VWUDWHJ\\LQWRWKHOLFHQVLQJEDVLV



 7LPHFULWLFDORSHUDWRUDFWLRQV 7&$V DVVRFLDWHGZLWKWKHSUHVFULEHG+(/%PLWLJDWLRQ

VWUDWHJLHV



 ([FOXVLRQRIV\\VWHPVZKRVHRSHUDWLQJWLPHDWKLJKHQHUJ\\ +( FRQGLWLRQVLVOHVV

WKDQSHUFHQWRIWKHWRWDOXQLWRSHUDWLQJWLPH



 ([FOXVLRQRIV\\VWHPVZKRVHRSHUDWLQJWLPHDW+(FRQGLWLRQVLVOHVVWKDQ

DSSUR[LPDWHO\\SHUFHQWRIWKHWRWDOV\\VWHPRSHUDWLQJWLPH



 (OLPLQDWLRQRIDUELWUDU\\LQWHUPHGLDWHEUHDNVLQ$PHULFDQ6RFLHW\\RI0HFKDQLFDO

(QJLQHHUV $60( %RLOHUDQG3UHVVXUH9HVVHO % 39 6HFWLRQ,,,&ODVVDQG&ODVV

HTXLYDOHQWSLSLQJ,QWHUPHGLDWHEUHDNVDUHSRVWXODWHGZKHUHFDOFXODWHG

ORQJLWXGLQDOVWUHVVIRUWKHDSSOLFDEOHORDGFDVHV LQWHUQDOSUHVVXUHGHDGZHLJKW

JUDYLW\\ WKHUPDODQGVHLVPLF 2%(>RSHUDWLQJEDVLVHDUWKTXDNH@ FRQGLWLRQV 

H[FHHG 6D6K 



,QWHUPHGLDWHEUHDNVLQQRQULJRURXVO\\DQDO\\]HGSLSLQJDUHSRVWXODWHGLQDFFRUGDQFH

ZLWK%UDQFK7HFKQLFDO3RVLWLRQ %73 0HFKDQLFDO(QJLQHHULQJ%UDQFK 0(% 

6HFWLRQ%F  E L 



(OLPLQDWLRQRIFULWLFDOFUDFNVDWWKHPRVWDGYHUVHORFDWLRQLQ$60(% 396HFWLRQ,,,

&ODVVDQG&ODVVHTXLYDOHQWSLSLQJ&ULWLFDOFUDFNVDUHSRVWXODWHGDWD[LDO

ORFDWLRQVZKHUHWKHFDOFXODWHGVWUHVVIRUWKHDSSOLFDEOHORDGFDVHV LQWHUQDOSUHVVXUH

GHDGZHLJKW JUDYLW\\ WKHUPDODQGVHLVPLF RSHUDWLQJEDVLVHDUWKTXDNH 2%( 

FRQGLWLRQV H[FHHG 6D6K &ULWLFDOFUDFNVDUHQRWSRVWXODWHGDWORFDWLRQVRI

WHUPLQDOHQGV







6KLVWKHVWUHVVFDOFXODWHGE\\WKHUXOHVRI1&DQG1'IRU&ODVVDQGFRPSRQHQWV

UHVSHFWLYHO\\RIWKH$60(% 39&RGH6HFWLRQ,,,:LQWHU$GGHQGD6DLVWKHDOORZDEOHVWUHVVUDQJH

IRUH[SDQVLRQVWUHVVFDOFXODWHGE\\WKHUXOHVRI1&RIWKH$60(% 39&RGH6HFWLRQ,,,RUWKH86$

6WDQGDUG&RGHIRU3UHVVXUH3LSLQJ$16,%

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











7KHHIIHFWVRIWKHSRVWXODWHGLQWHUPHGLDWHEUHDNVERXQGWKHHIIHFWVIURPFULWLFDO

FUDFNVWKHUHIRUHFULWLFDOFUDFNVDUHHOLPLQDWHGIURPHYDOXDWLRQLQQRQULJRURXVO\\

DQDO\\]HGSLSLQJ



'HWHUPLQDWLRQRIWKHHIIHFWLYHOHQJWKRIMHWVIURPDEUHDNRUFULWLFDOFUDFNLQ

DFFRUGDQFHZLWK185(*&5 5HIHUHQFH 



6WUDWHJLHVWRDFKLHYHDQGPDLQWDLQ&ROG6KXWGRZQ &6' FRQGLWLRQV



(OLPLQDWLRQRIWKH7&$WRFURVVFRQQHFW():



(OLPLQDWLRQRIWKH7&$WRPDQXDOO\\VWDUWWKHWXUELQHGULYHQ():SXPSORFDOO\\



5HDFWRUFRRODQWV\\VWHP 5&6 DFFHSWDQFHFULWHULDDVVSHFLILHGLQ$WWDFKPHQWRI

WKH/$5





6\\VWHP'HVLJQDQG2SHUDWLRQ



,QRUGHUWRPDLQWDLQDQ66'VWDWHIROORZLQJD+(/%RXWVLGHFRQWDLQPHQWRSHUDWRUVPXVW

PDLQWDLQFHUWDLQNH\\VDIHW\\IXQFWLRQV7KHVHIXQFWLRQVLQFOXGHUHDFWRUFRUHUHDFWLYLW\\FRQWURO

GHFD\\KHDWUHPRYDODQG5&6LQYHQWRU\\FRQWUROZKLFKVXSSRUWVWKHUHDFWLYLW\\FRQWURODQGGHFD\\

KHDWUHPRYDOIXQFWLRQV)RUHYHQWVWKDWFRXOGLQYROYHDUHDFWRUFRROGRZQUHDFWLYLW\\FRQWURO

UHTXLUHVDGGLWLRQRIVROXEOHQHXWURQSRLVRQ ERUDWHGZDWHU WRWKH5&6'HFD\\KHDWUHPRYDO

UHTXLUHVDVXSSO\\RIZDWHUWKDWFDQEHIHGWRWKHVWHDPJHQHUDWRUV 6*V DQGDKHDWVLQNIRUWKH

VWHDPJHQHUDWHGIURPGHFD\\KHDW)LQDOO\\UHDFWRUFRRODQWLQYHQWRU\\FRQWUROUHTXLUHVKLJKKHDG

LQMHFWLRQRIFRRODQWWRFRPSHQVDWHIRUWKHUPDOFRQWUDFWLRQDQGFRQWURORI5&6OHDNDJH



7KHSURSRVHGVWUDWHJ\\IRU+(/%VUHVXOWLQJLQWKHORVVRISODQWV\\VWHPVLQVLGHWKH7%QHHGHGIRU

66'LVWRUHO\\RQWKHDYDLODEOH66)DQG36:V\\VWHPVZKLFKDUHORFDWHGRXWVLGHWKH7%)RU

+(/%VZLWKLQWKH$%ZKLFKLQFOXGHVWKH(DVW3HQHWUDWLRQ5RRP (35 WKHOLFHQVHHSURSRVHG

FUHGLWLQJQRUPDOSODQWV\\VWHPVDQGWKH66)IRUHYHQWPLWLJDWLRQ)RU+(/%VLQDUHDVRXWVLGH

WKH7%DQG$%WKHOLFHQVHH¶VVWUDWHJ\\FUHGLWVQRUPDOSODQWV\\VWHPVIRUHYHQWPLWLJDWLRQ7KH

IROORZLQJV\\VWHPVSHUIRUPLPSRUWDQWIXQFWLRQVLQPLWLJDWLRQRISRVWXODWHG+(/%V





1RUPDO3ODQW6\\VWHPV



,Q6HFWLRQRIWKH(QFORVXUHWRWKH/$5WKHOLFHQVHHVWDWHGWKDWWKHQRUPDOSODQWV\\VWHPV

DQGUHODWHGVXSSRUWV\\VWHPVPD\\UHPDLQDYDLODEOHIRU+(/%PLWLJDWLRQ7KHVHV\\VWHPVFDQEH

XVHGIRUSODQWFRROGRZQDQGWKHHVWDEOLVKPHQWRI&6'



7KHOLFHQVHHGHILQHGWKHQRUPDOPRGHVRIRSHUDWLRQLQ$WWDFKPHQWWRWKH/$5DVIROORZV



02'( 3RZHU2SHUDWLRQ +/-2SHUDWLRQRIDQ216XQLWZLWKWKHIROORZLQJ

FRQGLWLRQVNHIIDQGWKHSHUFHQW5DWHG7KHUPDO3RZHUOHYHO!



02'( 6WDUWXS +/-2SHUDWLRQRIDQ216XQLWZLWKWKHIROORZLQJFRQGLWLRQVNHII

DQGWKHSHUFHQW5DWHG7KHUPDO3RZHUOHYHO



02'( +RW6WDQGE\\ +/-2SHUDWLRQRIDQ216XQLWZLWKWKHIROORZLQJFRQGLWLRQV

NHIIDQGWKHDYHUDJH5&67HPSHUDWXUHLV)

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











02'( +RW6KXWGRZQ +/-2SHUDWLRQRIDQ216XQLWZLWKWKHIROORZLQJ

FRQGLWLRQVNHIIDQGWKHDYHUDJH5&67HPSHUDWXUH 7 LV)!7!

)



02'( &ROG6KXWGRZQ +/-2SHUDWLRQRIDQ216XQLWZLWKWKHIROORZLQJ

FRQGLWLRQVNHIIDQGWKHDYHUDJH5&67HPSHUDWXUHLV)7REHLQ

0RGHDOOUHDFWRUYHVVHO 59 KHDGFORVXUHEROWVPXVWEHIXOO\\WHQVLRQHG





+LJK3UHVVXUH,QMHFWLRQ6\\VWHP



7KH+3,6\\VWHPLVGHVFULEHGLQ6HFWLRQRIWKH8)6$57KH+3,6\\VWHPFRQWUROVWKH5&6

FRRODQWLQYHQWRU\\SURYLGHVWKHVHDOZDWHUIRUWKHUHDFWRUFRRODQWSXPSV 5&3V DQG

UHFLUFXODWHV5&6OHWGRZQIRUZDWHUTXDOLW\\PDLQWHQDQFHDQGUHDFWRUFRRODQWERULFDFLGFRQWURO

7KHOLFHQVHHVWDWHGWKDWWKH+3,6\\VWHPFRQVLVWVRIWZRLQGHSHQGHQWWUDLQVHDFKRIZKLFKVSOLWV

WRGLVFKDUJHLQWRWZR5&6FROGOHJVVRWKDWWKHUHLVWRWDORIIRXU+3,LQMHFWLRQOLQHV7KH+3,

6\\VWHPFRQWDLQVWKUHH+3,SXPSVWZRRIWKHSXPSVDUHQRUPDOO\\DOLJQHGWRDXWRPDWLFDOO\\

VXSSRUW+3,WUDLQ$DQGWKHGLVFKDUJHIORZSDWKIRUWKHWKLUGSXPSLVQRUPDOO\\DOLJQHGWR

DXWRPDWLFDOO\\VXSSRUW+3,WUDLQ%7KHGLVFKDUJHIORZSDWKVFDQEHPDQXDOO\\DOLJQHGVXFKWKDW

HDFKRIWKH+3,SXPSVFDQSURYLGHIORZWRHLWKHUWUDLQ7KHWZR+3,WUDLQVDUHGHVLJQHGDQG

DOLJQHGVXFKWKDWWKH\\DUHQRWERWKVXVFHSWLEOHWRDQ\\VLQJOHDFWLYHIDLOXUH 6$) LQFOXGLQJWKH

IDLOXUHRIDQ\\SRZHURSHUDWLQJFRPSRQHQWWRRSHUDWHRUDQ\\VLQJOHIDLOXUHRIHOHFWULFDO

HTXLSPHQW





(PHUJHQF\\)HHGZDWHU6\\VWHP



7KH():6\\VWHPLVGHVFULEHGLQ6HFWLRQRIWKH8)6$5,WDXWRPDWLFDOO\\VXSSOLHV

IHHGZDWHU )': WRWKH6*VWRUHPRYHGHFD\\KHDWIURPWKH5&6XSRQWKHORVVRIQRUPDO)':

VXSSO\\7KH():6\\VWHPLQFOXGHVWZR$OWHUQDWLQJ&XUUHQW $& PRWRUGULYHQSXPSVDQGRQH

WXUELQHGULYHQSXPSSHUXQLWWKDWLVLQGHSHQGHQWRI$&SRZHU(DFKPRWRUGULYHQSXPS

QRUPDOO\\VHUYHVDVHSDUDWH6*ZKLOHWKHWXUELQHGULYHQSXPSQRUPDOO\\VHUYHVERWK6*V7KH

GLVFKDUJHKHDGHURIHDFK():6\\VWHPFDQEHFURVVFRQQHFWHGPDNLQJHDFKV\\VWHPFDSDEOHRI

VXSSO\\LQJDQ\\XQLW)ROORZLQJDUHDFWRUWULSWKH():6\\VWHPFDQSURYLGHVXIILFLHQW)':WR

PDLQWDLQ+RW6WDQGE\\IRUDWOHDVWKRXUVZLWKRUZLWKRXWRIIVLWHSRZHU





3URWHFWHG6HUYLFH:DWHU6\\VWHP



7KH36:V\\VWHPLVDKLJKKHDGPRGHUDWHYROXPHV\\VWHPWKDWLVVKDUHGDPRQJWKHWKUHH

2FRQHH8QLWVDQGLVGHVFULEHGLQ6HFWLRQRIWKH2FRQHH8)6$57KHV\\VWHPLVGHVLJQHG

DVDVWDQGE\\V\\VWHPIRUXVHXQGHUHPHUJHQF\\FRQGLWLRQVDQGSURYLGHVDGGHGGHIHQVHLQGHSWK

SURWHFWLRQE\\VHUYLQJDVDEDFNXSWRH[LVWLQJVDIHW\\V\\VWHPV7KLVSURYLGHVDQDOWHUQDWHPHDQV

WRDFKLHYHDQGPDLQWDLQ66'FRQGLWLRQVIRURQHWZRRUWKUHHXQLWVIROORZLQJSRVWXODWHG

VFHQDULRVWKDWGDPDJHHVVHQWLDOV\\VWHPVDQGFRPSRQHQWVQRUPDOO\\XVHGIRU66',QWKHHYHQW

RID+(/%LQWKH7%WKH36:V\\VWHPLVLQWHQGHGWRPLWLJDWHSRVWXODWHGHYHQWVWKDWUHVXOWLQWKH

GDPDJHWRHVVHQWLDOHTXLSPHQWORFDWHGLQVLGHWKH7%WKDWDUHXVHGWRDFKLHYHDQGPDLQWDLQ

66'FRQGLWLRQV



7KH36:PHFKDQLFDOV\\VWHPFRPSRQHQWVDQGSLSLQJDUHORFDWHGSULPDULO\\LQWKH$%DQG

HOHFWULFDOVZLWFKJHDULVSULPDULO\\ORFDWHGLQDVHSDUDWHVKDUHG36:EXLOGLQJ7KHV\\VWHP

SURYLGHVEDFNXS6*)':FDSDELOLWLHVXVLQJSULPDU\\DQGERRVWHU36:SXPSVORFDWHGLQWKH$%

DQGEDFNXSHOHFWULFDOSRZHUFDSDELOLW\\IRUWKH+3,SXPSV7KH36:V\\VWHPVXSSOLHVHOHFWULFDO

SRZHUWRWKH36:SXPSVDQGEDFNXSSRZHUWRWKH+3,SXPSVIURPLQGHSHQGHQWVZLWFKJHDULQ

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











WKH36:EXLOGLQJ7KH36:SULPDU\\DQGERRVWHUSXPSVWDNHVXFWLRQIURP8QLW&RQGHQVHU

&LUFXODWLQJ:DWHU &&: SLSLQJDQGGLVFKDUJHLQWRWKH6*IRUHDFKXQLWYLDWKH():SLSLQJIURP

MXVWRXWVLGHFRQWDLQPHQW7KH36:SXPSVDUHRSHUDWHGIURPWKH8QLWFRQWUROURRP)RU

H[WHQGHGRSHUDWLRQWKH36:SRUWDEOHSXPSZLWKDIORZSDWKFDSDEOHRIWDNLQJVXFWLRQIURPWKH

LQWDNHFDQDODQGGLVFKDUJLQJLQWRWKH8QLW&&:SLSLQJLVGHVLJQHGWRSURYLGHDEDFNXSVXSSO\\

RIZDWHUWRWKH36:V\\VWHPLQWKHHYHQWRIORVVRI&&:DQGVXEVHTXHQWORVVRI&&:VLSKRQ

IORZ



7KH36:V\\VWHPFDSDELOLWLHVDUHUHGXQGDQWWRDQGGLYHUVHIURPWKH66)V\\VWHP,WVPLVVLRQLV

WRDFKLHYHDQGPDLQWDLQ66'E\\PDLQWDLQLQJUHDFWLYLW\\FRQWURO VKXWGRZQPDUJLQ 5&6

LQYHQWRU\\DQGUHDFWRUFRRODQWWHPSHUDWXUHDQGSUHVVXUHZLWKLQDFFHSWDEOHOLPLWVE\\VXSSRUWLQJ

GHFD\\KHDWUHPRYDOWKURXJKWKH6*V7KH36:SULPDU\\DQGERRVWHUSXPSVPRWRURSHUDWHG

YDOYHVDQGVROHQRLGYDOYHVUHTXLUHGWREULQJWKHV\\VWHPLQWRVHUYLFHDUHFRQWUROOHGIURPWKH

PDLQFRQWUROURRPV &5V &KHFNYDOYHVDQGPDQXDOKDQGZKHHORSHUDWHGYDOYHVDUHXVHGWR

SUHYHQWEDFNIORZWRDFFRPPRGDWHWHVWLQJRUIRUV\\VWHPLVRODWLRQ





6WDQGE\\6KXWGRZQ)DFLOLW\\



7KH66)LVGHVLJQHGDVDVWDQGE\\V\\VWHPIRUXVHXQGHUFHUWDLQHPHUJHQF\\FRQGLWLRQVDQGLV

GHVFULEHGLQ6HFWLRQRIWKH2FRQHH8)6$57KHV\\VWHPSURYLGHVDGGLWLRQDOGHIHQVHLQ

GHSWKSURWHFWLRQIRUWKHKHDOWKDQGVDIHW\\RIWKHSXEOLFE\\VHUYLQJDVDEDFNXSWRH[LVWLQJVDIHW\\

V\\VWHPV,WSURYLGHVDQDOWHUQDWHPHDQVWRDFKLHYHDQGPDLQWDLQWKHXQLW V LQ0RGHZLWK

DYHUDJH5&6WHPSHUDWXUH) XQOHVVWKHLQLWLDWLQJHYHQWFDXVHVWKHXQLW V WREHGULYHQWR

DORZHUWHPSHUDWXUH IROORZLQJDILUH7%IORRGDQGVWDWLRQEODFNRXW 6%2 HYHQWV7KH66)LV

GHVLJQHGWRPDLQWDLQWKHUHDFWRU V LQDQ66'FRQGLWLRQIRUDSHULRGRIKRXUVIROORZLQJDILUH

RU7%IORRGDQGIRUDSHULRGRIKRXUVIROORZLQJDQ6%27KHPDLQFRPSRQHQWVRIWKH66)

DUHWKHDX[LOLDU\\VHUYLFHZDWHU $6: V\\VWHP66)3RUWDEOH3XPSLQJV\\VWHP66)5HDFWRU

&RRODQW0DNHXS 5&08 V\\VWHP66)SRZHUV\\VWHPDQG66)LQVWUXPHQWDWLRQ



7KH66)LVDUHLQIRUFHGFRQFUHWHVWUXFWXUHFRQVLVWLQJRIDGLHVHOJHQHUDWRUURRPHOHFWULFDO

HTXLSPHQWURRPPHFKDQLFDOSXPSURRPFRQWUROURRPFHQWUDODODUPVWDWLRQ &$6 DQG

YHQWLODWLRQHTXLSPHQWURRP36:DQG66)$6:V\\VWHPVSURYLGHFRROLQJZDWHUIURP/DNH

.HRZHHYLD&&:8QLW3LSLQJ66)FRQQHFWLRQLQWR():SLSLQJIURPWKH66)$6:SXPSLV

ORFDWHGZLWKLQWKH$%DQGFRQQHFWHGXSVWUHDPRI6*¶VDQGGRZQVWUHDPRI():SXPSV



'XULQJDQ66)(YHQWWKH5&6WUDQVIHUVKHDWIURPWKHUHDFWRUWRWKH6*VYLDQDWXUDOFLUFXODWLRQ

IORZ5&6QDWXUDOFLUFXODWLRQIORZLVXVHGWRWUDQVIHUKHDWWRWKH6*VGXULQJDQ66)(YHQW

LQVWHDGRIIRUFHG5&6IORZEHFDXVHWKH5&3VZLOOEHXQDYDLODEOH5&6QDWXUDOFLUFXODWLRQIORZ

LVHVWDEOLVKHGZKHQ66)$6:V\\VWHPIORZLVLQLWLDWHGWRDXQLW¶V6*V2QFH66)$6:IORZLV

HVWDEOLVKHGWKH66)FRQWUROURRP2SHUDWRUZLOOFRQWUROWKH66)$6:V\\VWHPIORZUDWHSURYLGHG

WRWKH6*VEDVHGRQ5&6SDUDPHWHUVDQGVWHDPJHQHUDWRUOHYHO



7KH66)$6:V\\VWHPLVDKLJKKHDGKLJKYROXPHV\\VWHPGHVLJQHGWRSURYLGH)':WRWKH6*V

IRUDGHTXDWHGHFD\\KHDWUHPRYDO '+5 IRUWKUHHXQLWVGXULQJDORVVRIQRUPDO$&SRZHULQ

FRQMXQFWLRQZLWKWKHORVVRIWKHPDLQIHHGZDWHU 0)': DQG():V\\VWHPV7KH66)$6:

SXPSXWLOL]HVDVXFWLRQVXSSO\\RIODNHZDWHUIURPWKHHPEHGGHG8QLW&&:SLSLQJ



7KH66)3RUWDEOH3XPSLQJV\\VWHPZKLFKLQFOXGHVDVXEPHUVLEOHSXPSDQGDIORZSDWK

FDSDEOHRIWDNLQJVXFWLRQIURPWKHLQWDNHFDQDODQGGLVFKDUJLQJLQWRWKH8QLW&&:OLQHLV

GHVLJQHGWRSURYLGHDEDFNXSVXSSO\\RIZDWHUWRWKH66)LQWKHHYHQWRIORVVRI&&:DQG

VXEVHTXHQWORVVRI&&:VLSKRQIORZ7KH66)3RUWDEOH3XPSLQJV\\VWHPLVLQVWDOOHGPDQXDOO\\

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











LQDFFRUGDQFHZLWKSURFHGXUHV7KHOLFHQVHHFUHGLWVWKLVSDWKIRUORQJWHUP66)XVDJHE\\

EULQJLQJZDWHUIURPWKHODNHWR&&:SLSLQJZKLFKLVWKHQRUPDOLQYHQWRU\\VXSSO\\IRUWKH66)



7KH66)5&08V\\VWHPLVGHVLJQHGWRVXSSO\\PDNHXSWRWKH5&6DQG5&3VHDOFRROLQJLI

QRUPDOPDNHXSV\\VWHPVDUHXQDYDLODEOH$Q66)5&08SXPSORFDWHGLQWKHUHDFWRUEXLOGLQJ

5% RIHDFKXQLWVXSSOLHVPDNHXSWRWKH5&6VKRXOGWKHQRUPDOPDNHXSV\\VWHPIORZDQGVHDO

FRROLQJEHFRPHXQDYDLODEOH,WSURYLGHVVHDOLQMHFWLRQIORZLQWKHHYHQWWKDW+3, QRUPDOVHDO

VXSSO\\ LVXQDYDLODEOH7KH66)UHTXLUHVPDQXDODFWLYDWLRQDQGFDQEHDFWLYDWHGLIHPHUJHQF\\

V\\VWHPVDUHQRWDYDLODEOH





'HVFULSWLRQRIWKH3URSRVHG&KDQJHV



7KH/$5ZRXOGPRGLI\\WKHSODQWOLFHQVLQJEDVLVIRU2FRQHH8QLWVDQGE\\UHYLVLQJWKH

8)6$5WRLGHQWLI\\WKHQHFHVVDU\\66&VWRLPSOHPHQWWKH+(/%PLWLJDWLRQVWUDWHJLHVDQG

GHVFULEHWKHPHWKRGRORJ\\DQGUHVXOWVRIWKHDQDO\\VLVSHUIRUPHGWRHYDOXDWHWKHSURWHFWLRQRIWKH

UHDFWRU¶V66&VIURPWKHHIIHFWVRI+(/%V



,QLWV/$5WKHOLFHQVHHGHVFULEHGFRQIRUPLQJDFWLRQV SUHYLRXVO\\FRPPLWPHQWV DQG

PRGLILFDWLRQVWKDWLWZDVPDNLQJWRWKHSODQWWRHQKDQFHWKHRYHUDOOGHVLJQDQGVDIHW\\PDUJLQ

7KHOLFHQVHHVWDWHGWKDWLWZDVQRWDSSO\\LQJIRU15&DSSURYDORIWKHPRGLILFDWLRQVUDWKHUWKH

OLFHQVHHGHWHUPLQHGWKDWWKHPRGLILFDWLRQVFRXOGEHSHUIRUPHGYLD&)5³&KDQJHV

WHVWVDQGH[SHULPHQWV'ZLWKRXWSULRU15&DSSURYDO7KHOLFHQVHHSURSRVHGWRFUHGLWWKHSODQW

PRGLILFDWLRQVWRHQKDQFHWKHSODQW¶VFDSDELOLW\\WRZLWKVWDQGWKHHIIHFWVRID+(/%7KH

PRGLILFDWLRQVLQFOXGHLQVWDOODWLRQRIWKHQHZ66)OHWGRZQOLQHLQVWDOODWLRQXSJUDGHRI66)

FRQWUROURRP4$LQVWUXPHQWDWLRQXSJUDGHRIWKHLQOHWLVRODWLRQYDOYHVIRUWKH8QLWOHWGRZQ

FRROHUVXSJUDGHWRWKHKHDWLQJYHQWLODWLRQDQGDLUFRQGLWLRQLQJ +9$& GXFWLQJLPSDFWLQJWKH

FRQWUROFRPSOH[XSJUDGHRI7%VWUXFWXUDOVXSSRUWFROXPQVXSJUDGHRIVXFWLRQYDOYHVWRWKH

8QLW$ %+3,SXPSVHOLPLQDWLRQRIWKH&RQWURO5RG'ULYH &5' FURVVFRQQHFWEHWZHHQ

XQLWVHQYLURQPHQWDOTXDOLILFDWLRQRI66)UHODWHGFRPSRQHQWVORFDWHGLQHDFKXQLW¶V$%

LQVWDOODWLRQRI+(/%SURWHFWHGLVRODWLRQIRUWKHDOWHUQDWH5%FRROLQJV\\VWHPUHWXUQSLSLQJ

DOLJQPHQWDQG7&$YDOLGDWLRQ,QLWVVXEPLWWDOWKHOLFHQVHHVWDWHGWKDWWKHPRGLILFDWLRQVZLOOEH

FRPSOHWHGSULRUWRLPSOHPHQWDWLRQRIWKH/$5





3URSRVHG8)6$5&KDQJHV



7KHOLFHQVHHSURSRVHGWRUHYLVHVHFWLRQVRIWKH8)6$5DVIROORZV GHOHWLRQVLQGRXEOHVWULNH

RXWDGGLWLRQVLQGRXEOHXQGHUOLQH 



7KHOLFHQVHHSURSRVHGWRUHYLVH6HFWLRQ³3URWHFWLRQ$JDLQVW'\\QDPLF(IIHFWV$VVRFLDWHG

ZLWKWKH3RVWXODWHG5XSWXUHRI3LSLQJ'RIWKH8)6$5DVIROORZV





3URWHFWLRQ$JDLQVW'\\QDPLF(IIHFWV$VVRFLDWHGZLWKWKH

3RVWXODWHG5XSWXUHRI3LSLQJ



0DLQ6WHDP+LJK(QHUJ\\/LQH%UHDNV 06+(/%V DUHQRWV\\QRQ\\PRXVZLWK

0DLQ6WHDP/LQH%UHDNV 06/%V 7KHDQDO\\VHVDQGWKHWUHDWPHQWRI06/%VDV

GHVFULEHGLQ8)6$56HFWLRQVDQGZHUHUHTXLUHGDVSDUWRIWKHLQLWLDO

OLFHQVLQJRIWKH2FRQHH1XFOHDU6WDWLRQ 216 XQLWV7KHDQDO\\VHVZHUH

FRPSOHWHGWRHYDOXDWHWKHUHDFWRUFRUHUHVSRQVHWRWKHUHVXOWLQJRYHUFRROLQJ

IROORZLQJWKH06/%7KHSRVWXODWHGEUHDNORFDWLRQVIRUWKH06/%DQDO\\VHV

GHVFULEHGLQ&KDSWHUZHUHQRWVSHFLILHGDQGDVVXFKGDPDJHIURPWKH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











06/%ZDVQRWFRQVLGHUHG7KH*LDPEXVVR6FKZHQFHUOHWWHUV 5HIHUHQFHV

DQG ZHUHUHOHDVHGDVFRQVWUXFWLRQRI8QLWZDVQHDULQJFRPSOHWLRQ7KHVH

OHWWHUVUHTXLUHGWKDWOLFHQVHHVFRQVLGHUGDPDJHIROORZLQJDSRVWXODWHGEUHDN

LQFOXGLQJWKRVHSRVWXODWHGLQWKH06V\\VWHP7KHVHEUHDNVZHUHFRQVLGHUHGIRU

GLIIHUHQWSXUSRVHVXVLQJGLIIHUHQWDVVXPSWLRQVDQGDFFHSWDQFHFULWHULD,QFDVHV

ZKHUHWKHSRWHQWLDOGDPDJHSRVWXODWHGIRUD06+(/%ZDVVLPLODUWRWKHLQSXWV

DQGDVVXPSWLRQVXVHGLQWKH06/%DQDO\\VHVGHVFULEHGLQ8)6$5

6HFWLRQVDQGWKRVHDQDO\\VHVZHUHXVHGDVVXUURJDWHVIRUWKH06

+(/%DQDO\\VHV,QDVLPLODUPDQQHUD0DLQ)HHGZDWHU 0)': +(/%LVQRW

V\\QRQ\\PRXVZLWKD0DLQ)HHGZDWHU/LQH%UHDN 0)/% 7KHDQDO\\VHVIRUD

0)/%DVGLVFXVVHGLQ8)6$56HFWLRQZHUHFRPSOHWHGWRHYDOXDWHWKH

UHDFWRUFRUHUHVSRQVHWRWKHRYHUKHDWLQJFDXVHGE\\WKH0)/%7KHSRVWXODWHG

EUHDNORFDWLRQVRIWKH0)/%VGHVFULEHGLQ&KDSWHUZHUHQRWVSHFLILHGDQG

GDPDJHIURPWKH0)/%VZDVQRWFRQVLGHUHG+RZHYHUIRU0)':+(/%VWKH

  • LDPEXVVR6FKZHQFHUOHWWHUVUHTXLUHGHYDOXDWLRQRIVSHFLILFORFDWLRQVDQG

SRWHQWLDOGDPDJH



7KHOLFHQVHHSURSRVHGWRUHQDPH6HFWLRQDVIROORZV





3RVWXODWHG3LSLQJ)DLOXUHVLQ)OXLG6\\VWHPV,QVLGHDQG

2XWVLGH&RQWDLQPHQW



7KHOLFHQVHHSURSRVHGWRGHOHWHFXUUHQW6HFWLRQ³3URWHFWHG6HUYLFH:DWHU 36: 

6\\VWHP'



7KHOLFHQVHHSURSRVHGWRGHOHWHFXUUHQW6HFWLRQ³6DIHW\\(YDOXDWLRQ'



7KHOLFHQVHHSURSRVHGWRDGGQHZ6HFWLRQ³3RVWXODWHG3LSLQJ)DLOXUHVLQ)OXLG6\\VWHPV

2XWVLGH&RQWDLQPHQW'DVIROORZV





3RVWXODWHG3LSLQJ)DLOXUHVLQ)OXLG6\\VWHPV2XWVLGH

&RQWDLQPHQW



7KHSXUSRVHRIWKLVGHVFULSWLRQLVWRSURYLGHDFRPSUHKHQVLYHVWUDWHJ\\IRU

PLWLJDWLQJWKHSRWHQWLDODGYHUVHLQWHUDFWLRQVFDXVHGE\\WKH2FRQHH1XFOHDU

6WDWLRQ 216 SRVWXODWHG+(/%V7KHVWUDWHJ\\SURYLGHVDQHYDOXDWLRQRIWKH

216SRVWXODWHG+(/%VDQGGHVFULEHVWKH DVPRGLILHG 216FRQILJXUDWLRQIRU

WKHLGHQWLILHG+(/%V,WDOVRVXSHUVHGHVWKHDQDO\\VLVSURYLGHGLQWKHRULJLQDO

216+(/%DQDO\\VLV 5HIHUHQFHVDQG 7KHVWUDWHJ\\LGHQWLILHVDQG

GHVFULEHVWKHSDWKZD\\WRDVDIHVKXWGRZQ 66' FRQGLWLRQIRUDQ\\SRVWXODWHG

+(/%LQDQ\\XQLW+(/%VDUHRQO\\SRVWXODWHGWRRFFXUGXULQJWKHQRUPDO

RSHUDWLQJFRQILJXUDWLRQRIWKHV\\VWHPZLWKWKHXQLWRSHUDWLQJDWUDWHG

WKHUPDOSRZHUOHYHO IXOOSRZHU 



7KHUHYLVHG+(/%PLWLJDWLRQVWUDWHJLHVZLOOEHLPSOHPHQWHGZKHQWKHIROORZLQJ

FRQIRUPLQJDFWLRQVDUHFRPSOHWHGLQVWDOODWLRQRIQHZVWDQGE\\VKXWGRZQIDFLOLW\\

66) OHWGRZQOLQHLQVWDOODWLRQXSJUDGHRI66)FRQWUROURRP4$

LQVWUXPHQWDWLRQXSJUDGHRILQOHWLVRODWLRQYDOYHVWRWKH8QLWOHWGRZQFRROHUV

XSJUDGHWRWKHKHDWLQJYHQWLODWLRQDQGDLUFRQGLWLRQLQJGXFWLQJLPSDFWLQJWKH

FRQWUROFRPSOH[XSJUDGHRIWXUELQHEXLOGLQJ 7% VWUXFWXUDOVXSSRUWFROXPQV

XSJUDGHRIVXFWLRQYDOYHVWRWKH8QLW$ %+LJK3UHVVXUH,QMHFWLRQ +3, 

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











SXPSVHOLPLQDWLRQRIWKH&RQWURO5RG'ULYH &5' FURVVFRQQHFWEHWZHHQXQLWV

HQYLURQPHQWDOO\\TXDOLI\\66)UHODWHGFRPSRQHQWVORFDWHGLQHDFK8QLW¶VDX[LOLDU\\

EXLOGLQJ $% SURYLGH+(/%SURWHFWHGLVRODWLRQIRU$OWHUQDWH5HDFWRU%XLOGLQJ

&RROLQJ 5%& 6\\VWHPUHWXUQSLSLQJDOLJQPHQWDQG7LPH&ULWLFDO2SHUDWRU

$FWLRQV 7&$ YDOLGDWLRQ





,GHQWLILFDWLRQRI+LJK(QHUJ\\/LQHV



7KHIROORZLQJFULWHULDDUHXVHGWRLGHQWLI\\WKHKLJKHQHUJ\\SLSLQJDQGWKH

ERXQGDULHVRIWKHKLJKHQHUJ\\SRUWLRQVRIWKHV\\VWHPV



x

7KHKLJKHQHUJ\\ SLSLQJ OLQHVDUHWKRVHOLQHVWKDWGXULQJLQLWLDORSHUDWLQJ

FRQGLWLRQVWKHIOXLGLQVLGHRIWKHSLSHKDVHLWKHURUERWKRIWKHIROORZLQJ

FRQGLWLRQV



 $QRUPDORSHUDWLQJWHPSHUDWXUHJUHDWHUWKDQ)

 $QRUPDORSHUDWLQJSUHVVXUHJUHDWHUWKDQSVLJ



x

7KHKLJKHQHUJ\\VHFWLRQRIDQ\\SLSLQJUXQVKDOOH[WHQGIURPFRPSRQHQWWR

FRPSRQHQW7KHKLJKHQHUJ\\SRUWLRQVKDOOQRWWHUPLQDWHXQOHVVWKHUHLVD

WHUPLQDWLRQDWDYHVVHODSXPSDFORVHGYDOYHRUHTXLYDOHQWERXQGDU\\



x

3LSLQJGRZQVWUHDPRIDQRUPDOO\\FORVHGYDOYHWKDWLVWKHKLJKHQHUJ\\

ERXQGDU\\IRUDKLJKHQHUJ\\SLSLQJUXQLVQRWSRVWXODWHGWREHKLJKHQHUJ\\

GXHWRSRWHQWLDOOHDNDJHDFURVVWKHFORVHGYDOYH



x

+LJKHQHUJ\\OLQHERXQGDULHVDUHEDVHGXSRQWKHQRUPDORSHUDWLQJ

FRQILJXUDWLRQRIWKHV\\VWHPZLWKWKHXQLWRSHUDWLQJDWUDWHGWKHUPDO

SRZHUOHYHO IXOOSRZHU 



x

  • DV6\\VWHPV HJ1LWURJHQ DQGRLOV\\VWHPV HJ(OHFWUR+\\GUDXOLF

&RQWURO DUHQRWLGHQWLILHGDVKLJKHQHUJ\\V\\VWHPVEHFDXVHWKRVH

V\\VWHPVSRVVHVVOLPLWHGHQHUJ\\





,GHQWLILFDWLRQRI+LJK(QHUJ\\/LQH%UHDN/RFDWLRQV



7KHIROORZLQJFULWHULDDUHXVHGWRLGHQWLI\\WKHKLJKHQHUJ\\SLSLQJEUHDNORFDWLRQV



x

+(/%VRIDQ\\W\\SHDUHQRWSRVWXODWHGRQKLJKHQHUJ\\SLSLQJWKDWKDVD

QRPLQDOVL]HRI  LQFKRUOHVV



x

+(/%VDQGFULWLFDOFUDFNVDUHQRWSRVWXODWHGRQKLJKHQHUJ\\OLQHVWKDW

RSHUDWHDWKLJKHQHUJ\\FRQGLWLRQVOHVVWKDQDSSUR[LPDWHO\\RIWKHWRWDO

V\\VWHPRSHUDWLQJWLPH



x

+(/%VDQGFULWLFDOFUDFNVDUHQRWSRVWXODWHGRQKLJKHQHUJ\\OLQHVWKDW

RSHUDWHDWKLJKHQHUJ\\FRQGLWLRQVOHVVWKDQRIWKHWRWDOSODQW XQLW 

RSHUDWLQJWLPH 1RUPDO3ODQW&RQGLWLRQV 



x

+(/%VDUHSRVWXODWHGDWWKH7HUPLQDO(QGVRIKLJKHQHUJ\\SLSLQJUXQV

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21













x

7KHUHLVQR$PHULFDQ6RFLHW\\RI0HFKDQLFDO(QJLQHHUV $60( %RLOHU

DQG3UHVVXUH % 39 &RGH6HFWLRQ,,,'LYLVLRQ&ODVVHTXLYDOHQW

SLSLQJRXWVLGHRIWKHFRQWDLQPHQWEXLOGLQJ



x

)RU$60(% 396HFWLRQ,,,&ODVVDQG&ODVVHTXLYDOHQWSLSLQJWKDWLV

VHLVPLFDOO\\DQDO\\]HG+(/%VDUHSRVWXODWHGDWD[LDOORFDWLRQVZKHUHWKH

FDOFXODWHGORQJLWXGLQDOVWUHVVIRUWKHDSSOLFDEOHORDGFDVHV LQWHUQDO

SUHVVXUHGHDGZHLJKW JUDYLW\\ WKHUPDODQGVHLVPLF 2%( FRQGLWLRQV 

H[FHHGV 6D6K 



x

)RU$60(% 396HFWLRQ,,,&ODVVDQG&ODVVHTXLYDOHQWSLSLQJWKDWLV

VHLVPLFDOO\\DQDO\\]HGFULWLFDOFUDFNVDUHSRVWXODWHGDWD[LDOORFDWLRQV

ZKHUHWKHFDOFXODWHGVWUHVVIRUWKHDSSOLFDEOHORDGFDVHVH[FHHG 6D

6K $SSOLFDEOHORDGFDVHVLQFOXGHLQWHUQDOSUHVVXUHGHDGZHLJKW

JUDYLW\\ WKHUPDODQGVHLVPLF 2%( &ULWLFDOFUDFNVDUHQRWSRVWXODWHG

DWORFDWLRQVRIWHUPLQDOHQGRULQWHUPHGLDWHEUHDNV



x

)RUEUDQFKFRQQHFWLRQVZKHUHWKHEUDQFKOLQHLVLQFOXGHGLQWKHVHLVPLF

VWUHVVDQDO\\VLVRIWKHUXQSLSLQJWKHVWUHVVFULWHULDIRUVHLVPLFDOO\\

DQDO\\]HGSLSLQJOLQHVLVXVHGWRGHWHUPLQH+(/%V



x

%UHDNVDQGFULWLFDOFUDFNVDWFORVHGYDOYHVDUHSRVWXODWHGDVIROORZV7KH

SRVWXODWLRQRIWHUPLQDOHQGEUHDNVDWWKHILUVWQRUPDOO\\FORVHGYDOYH V 

VHSDUDWLQJSRUWLRQVRIDV\\VWHPPDLQWDLQHGSUHVVXUL]HGGXULQJQRUPDO

RSHUDWLRQVDQGSRUWLRQVRIDV\\VWHPQRWPDLQWDLQHGSUHVVXUL]HGGHSHQGV

RQZKHWKHUWKHV\\VWHPKDVDVHLVPLFDQDO\\VLVWKDWLVFRQWLQXRXVDFURVV

WKHYDOYH)RUV\\VWHPVRUSRUWLRQVRIV\\VWHPVWKDWDUHQRWVHLVPLFDOO\\

DQDO\\]HGEUHDNVDUHSRVWXODWHGWRRFFXUDWDOOSLSLQJJLUWKZHOGVLQWKH

V\\VWHPLQFOXGLQJWKRVHWKDWDWWDFKWRQRUPDOO\\FORVHGYDOYHV)RU

V\\VWHPVRUSRUWLRQVRIV\\VWHPVWKDWDUHVHLVPLFDOO\\DQDO\\]HGDQGWKH

DQDO\\VLVLVFRQWLQXRXVDFURVVWKHQRUPDOO\\FORVHGYDOYHVXFKWKDW

VWUHVVHVFDQEHDFFXUDWHO\\GHWHUPLQHGEUHDNDQGFUDFNORFDWLRQVDUH

GHWHUPLQHGEDVHGRQFRPSDULVRQWRWKHLQWHUPHGLDWHEUHDNDQGFUDFN

VWUHVVWKUHVKROGV



x

)RUSLSLQJWKDWLVQRWULJRURXVO\\DQDO\\]HGRUGRHVQRWLQFOXGHVHLVPLF

ORDGLQJV+(/%VDUHSRVWXODWHGDWLQWHUPHGLDWHEUHDNORFDWLRQVDV

SURYLGHGLQ%730(%6HFWLRQ%F  E L 



x

)RUEUDQFKHVZKHUHERWKWKHPDLQDQGEUDQFKUXQVDUHXQDQDO\\]HGRU

ZKHUHWKHVWUHVVDWWKHEUDQFKFRQQHFWLRQLVQRWDFFXUDWHO\\NQRZQEUHDN

ORFDWLRQVDUHSRVWXODWHGRQWKHEUDQFKDQGUXQVLGHVRIWKHFRQQHFWLRQ



x

)RUSLSLQJWKDWLVQRWULJRURXVO\\DQDO\\]HGRUGRHVQRWLQFOXGHVHLVPLF

ORDGLQJVFULWLFDOFUDFNVDUHQRWSRVWXODWHGVLQFHWKHHIIHFWVRISRVWXODWHG

+(/%VRQWKHVHSLSLQJUXQVZLOOERXQGWKHHIIHFWVIURPFULWLFDOFUDFNV



x

$FWXDOVWUHVVHVXVHGIRUFRPSDULVRQWRWKHEUHDNDQGFUDFNWKUHVKROGV

DUHFDOFXODWHGLQDFFRUGDQFHZLWKWKH216SLSLQJFRGHRIUHFRUG86$6

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











% (GLWLRQ $OORZDEOHVWUHVVYDOXHV6DDQG6KDUHGHWHUPLQHG

LQDFFRUGDQFHZLWK86$6%RUWKH86$6% )HEUXDU\\

GUDIWHGLWLRQZLWKHUUDWD FRGHDVDSSURSULDWH



x

0RGHUDWHHQHUJ\\OLQHEUHDNVDUHQRWSRVWXODWHG7KH+(/%UHTXLUHPHQWV

IRU216RQO\\UHTXLUHFRPSOLDQFHWRWKH*LDPEXVVR6FKZHQFHUOHWWHUV

7KHUHTXLUHPHQWVFRQWDLQHGWKHUHLQGRQRWLQFOXGHSRVWXODWLRQRI

PRGHUDWHHQHUJ\\OLQHEUHDNV



x

+LJK(QHUJ\\3LSLQJOLQHVZLWKDQLQWHUQDOSUHVVXUHDWDWPRVSKHULFRU

EHORZ SVLJ DUHH[FOXGHGIURPGDPDJHDVVHVVPHQWVGXHWR

LQVXIILFLHQWHQHUJ\\WRFUHDWHSLSHZKLSRIMHWLPSLQJHPHQWIRUFHV



x

)RUWKH06SHQHWUDWLRQVLQWRWKHFRQWDLQPHQWVWUXFWXUH06+(/%VDUH

SRVWXODWHGWRRFFXUDWWKHRXWVLGHIDFHRIWKHFRQFUHWHFRQWDLQPHQW

VWUXFWXUH



x

)RUWKH0)':SHQHWUDWLRQVLQWRWKHFRQWDLQPHQWVWUXFWXUH0)':

+(/%VDUHSRVWXODWHGWRRFFXURQWKHRXWVLGHRIWKHFRQWDLQPHQW

VWUXFWXUHVLGHRIWKH0DLQ)HHGZDWHUWHUPLQDOUXSWXUHJXDUGSLSHUHVWUDLQW



x

)RUDOORWKHU$60(% 396HFWLRQ,,,&ODVVHTXLYDOHQWSLSLQJ

SHQHWUDWLRQVLQWRWKHFRQWDLQPHQWVWUXFWXUH+(/%VDUHSRVWXODWHGWR

RFFXUDWWKHRXWVLGHIDFHRIWKHFRQFUHWHFRQWDLQPHQWVWUXFWXUH





,GHQWLILFDWLRQRI+LJK(QHUJ\\%UHDN7\\SHV



7KHIROORZLQJFULWHULDDUHXVHGWRLGHQWLI\\WKHKLJKHQHUJ\\EUHDNW\\SHVUHTXLUHGWR

EHSRVWXODWHGDWWKHLGHQWLILHGEUHDNORFDWLRQLQ2167KHUHDUHWKUHH  W\\SHV

RI+(/%VDW2167KH\\DUHFLUFXPIHUHQWLDOEUHDNVORQJLWXGLQDOEUHDNVDQG

FULWLFDOFUDFNV7KHFULWHULDIRUHDFKEUHDNW\\SHDUHDVIROORZV



x

&LUFXPIHUHQWLDO%UHDNVDUHSRVWXODWHGLQKLJKHQHUJ\\OLQHVWKDWH[FHHG

RQH  LQFKQRPLQDOSLSHVL]H



x

2QO\\FLUFXPIHUHQWLDOEUHDNVDUHSRVWXODWHGDWWHUPLQDOHQGVRIKLJK

HQHUJ\\SLSLQJUXQV /RQJLWXGLQDOEUHDNVDUHQRWSRVWXODWHGDWWHUPLQDO

HQGV 



x

/RQJLWXGLQDOEUHDNVDUHSRVWXODWHGLQKLJKHQHUJ\\OLQHVWKDWKDYHD

QRPLQDOSLSHVL]HRIIRXU  LQFKHVRUJUHDWHU



x

&LUFXPIHUHQWLDODQGORQJLWXGLQDOEUHDNVDUHQRWSRVWXODWHGWRRFFXU

FRQFXUUHQWO\\



x

/RQJLWXGLQDOEUHDNVDUHQRWSRVWXODWHGDWEUDQFKFRQQHFWLRQV



x

/RQJLWXGLQDOEUHDNVDUHSRVWXODWHGRQO\\DWLQWHUPHGLDWHEUHDNORFDWLRQV

x

/RQJLWXGLQDOEUHDNVDUHSRVWXODWHGSDUDOOHOWRWKHSLSHD[LVDQGRULHQWDWHG

DWDOOSRLQWVRQWKHSLSHFLUFXPIHUHQFH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21













x

7KHEUHDNDUHDRIDORQJLWXGLQDOEUHDNLVHTXDOWRWKHHIIHFWLYHFURVV

VHFWLRQDOIORZDUHDRIWKHSLSHLPPHGLDWHO\\XSVWUHDPRIWKHEUHDN

ORFDWLRQ



x

&ULWLFDO&UDFNVDUHSRVWXODWHGRQVHLVPLFDOO\\DQDO\\]HGKLJKHQHUJ\\SLSLQJ

WKDWH[FHHGVRQH  LQFKLQQRPLQDOSLSHVL]H





6KXWGRZQ6HTXHQFH(YDOXDWLRQ&ULWHULD



7KHIROORZLQJFULWHULDDUHXVHGWRLGHQWLI\\WKHV\\VWHPVDQGFRPSRQHQWV

QHFHVVDU\\IRU+(/%PLWLJDWLRQDQGRUXQLWVKXWGRZQWRWKHFROGVKXWGRZQ

FRQGLWLRQ



x

(TXLSPHQWXVHGWRPLWLJDWHSRVWXODWHG+(/%VLQFOXGHVWKRVHV\\VWHPV

DQGFRPSRQHQWVWKDWDUHXVHGIRUGHWHFWLRQDQGLVRODWLRQRIVSHFLILHG

+(/%V(TXLSPHQWWKDWLVXVHGIRUWKHGHWHFWLRQDQGLVRODWLRQIRUDQ

LGHQWLILHG+(/%LVWKHRQO\\GHWHFWLRQDQGLVRODWLRQHTXLSPHQWUHTXLUHGWR

EHWDUJHWVRIWKDWVSHFLILF+(/%



x

(TXLSPHQWXVHGWRPHHWDQ\\RIWKHIROORZLQJVKXWGRZQREMHFWLYHVDUH

FRQVLGHUHGDWDUJHWRISRVWXODWHG+(/%V



o 5HDFWLYLW\\&RQWURO

o 5&6,QYHQWRU\\&RQWURO

o 5&63UHVVXUH&RQWURO

o 5&6+HDW5HPRYDO&RQWURO

o 5HDFWRU%XLOGLQJ %RXQGDU\\ ,QWHJULW\\

o &RQWURO5RRP+DELWDELOLW\\ ORQJWHUP 

o 3ODQW&RROGRZQ

x

%RWKSULPDU\\DQGEDFNXSV\\VWHPVXVHGWRDFKLHYHWKHVKXWGRZQ

REMHFWLYHVGHVFULEHGDERYHDUHLQFOXGHGDVVKXWGRZQHTXLSPHQWDQG

WDUJHWVRIWKHSRVWXODWHG+(/%V



x

3LSLQJRULILFHVUHOLHIYDOYHVDQGFKHFNYDOYHVDUHFRQVLGHUHGSDVVLYH

W\\SHFRPSRQHQWVLQWKDWWKH\\GRQRWUHTXLUHDQH[WHUQDOSRZHUVRXUFHRU

PDQXDODFWLRQWRSHUIRUPWKHLULQWHQGHGIXQFWLRQDQGWKHVHFRPSRQHQWV

SHUIRUPWKHLULQWHQGHGIXQFWLRQUHJDUGOHVVRIWKHHQYLURQPHQWDO

FRQGLWLRQV7KHVHFRPSRQHQWVDUHQRWLGHQWLILHGDVUHTXLUHGLQWKH

VKXWGRZQVHTXHQFHEHFDXVHWKH\\DUHQRWVXEMHFWWRVLQJOHDFWLYHIDLOXUHV

6$)V 7KH\\DUHKRZHYHU+(/%WDUJHWV



x

$6$)LVSRVWXODWHGLQV\\VWHPVXVHGWRPLWLJDWHWKHFRQVHTXHQFHVRIWKH

SRVWXODWHG+(/%VDQG&ULWLFDO&UDFNVRUWKRVHV\\VWHPVXVHGWRDFKLHYHD

VKXWGRZQREMHFWLYHRIWKHXQLW7KHVLQJOHDFWLYHFRPSRQHQWIDLOXUHLV

DVVXPHGWRRFFXULQDGGLWLRQWRWKRVHFRPSRQHQWVGDPDJHGE\\WKH

SRVWXODWHGSLSHEUHDN

x

1R6$)VDUHSRVWXODWHGGXULQJWKH³3ODQW&RROGRZQ'SKDVHDQGWKH

³3ODQW&RROGRZQWRWKH&ROG6KXWGRZQ&RQGLWLRQ'SKDVH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21













x

$OODYDLODEOHV\\VWHPVLQFOXGLQJWKRVHDFWXDWHGE\\RSHUDWRUDFWLRQVPD\\

EHHPSOR\\HGWRPLWLJDWHWKHFRQVHTXHQFHVRIDSRVWXODWHG+(/%RU

FULWLFDOFUDFN



x

,QGHWHUPLQLQJWKHV\\VWHPVDQGFRPSRQHQWVDYDLODEOHWRPLWLJDWHWKH

FRQVHTXHQFHVRISRVWXODWHG+(/%VDOO6KXWGRZQ(TXLSPHQWLVDVVXPHG

WREHRSHUDEOHDQGDYDLODEOHDWWKHVWDUWRIWKHSRVWXODWHG+(/%

VHTXHQFH,WLVQRWQHFHVVDU\\WRSRVWXODWHWKDWDQ\\V\\VWHPVRU

FRPSRQHQWVDUHRXWRIVHUYLFHIRUPDLQWHQDQFH



x

$OWKRXJKDSRVWXODWHG+(/%RXWVLGHRIWKHFRQWDLQPHQWEXLOGLQJPD\\

XOWLPDWHO\\UHTXLUHDFROGVKXWGRZQKROGLQJDWKRWVWDQGE\\VKXWGRZQLV

DOORZHGLQRUGHUWKDWSODQWSHUVRQQHODVVHVVWKHVLWXDWLRQDQGPDNHDQ\\

QHFHVVDU\\UHSDLUVWRDOORZWKHXQLWWRUHDFKFROGVKXWGRZQ





,QWHUDFWLRQ(YDOXDWLRQ&ULWHULD



7KHIROORZLQJFULWHULDDUHXVHGWRGHWHUPLQHWKHLQWHUDFWLRQVWKDWRFFXUDVDUHVXOW

RISRVWXODWHG+(/%VZLWKVKXWGRZQHTXLSPHQWDQGWKHFULWHULDIRUGHWHUPLQLQJ

WKHSDWKZD\\WRFROGVKXWGRZQIRUDJLYHQSRVWXODWHG+(/%



x

7KHWDUJHWVRIWKHSRVWXODWHG+(/%VDUHWKRVHV\\VWHPVDQGFRPSRQHQWV

UHTXLUHGWRPLWLJDWHWKHFRQVHTXHQFHVRISRVWXODWHG+(/%VDQGRUDUH

XVHGGXULQJWKHVKXWGRZQVHTXHQFHWRVDIHO\\EULQJWKHXQLWWRWKHFROG

VKXWGRZQFRQGLWLRQ



x

66'&ROG6KXWGRZQDQG+(/%PLWLJDWLRQV\\VWHPVDQGFRPSRQHQWV

GLUHFWO\\LPSDFWHGE\\DVSHFLILFSRVWXODWHG+(/%DUHFRQVLGHUHGWREH

XQDYDLODEOHWRVXSSRUWWKH6KXWGRZQ2EMHFWLYHVIRUWKDWVSHFLILF+(/%

XQOHVVGRFXPHQWHGRWKHUZLVH



x

0RYHPHQWRIDUXSWXUHGKLJKHQHUJ\\SLSH LHSLSHZKLS LVFRQVLGHUHGIRU

SRWHQWLDOLQWHUDFWLRQV7KHSLSHZKLSLVDVVXPHGWRRFFXULQWKHSODQH

GHILQHGE\\WKHSLSLQJJHRPHWU\\



x

7KHHQHUJ\\OHYHOLQZKLSSLQJSLSHVPD\\EHFRQVLGHUHGLQVXIILFLHQWWR

UXSWXUHDQLPSDFWHGSLSHRIHTXDORUJUHDWHUQRPLQDOSLSHVL]HDQGHTXDO

RUKHDYLHUZDOOWKLFNQHVV



x

1RVHFRQGDU\\SLSHEUHDNVDUHSRVWXODWHGGXHWRMHWLPSLQJHPHQWIURPWKH

VRXUFHSLSH SLSHZLWKSRVWXODWHG+(/% 



x

7KH-HW,PSLQJHPHQW)RUFHV-HW,PSLQJHPHQW&RQH*HRPHWU\\DQGWKH

-HW,PSLQJHPHQW(IIHFWLYH/HQJWKDUHGHWHUPLQHGLQDFFRUGDQFHZLWK

185(*&5³7ZR3KDVH-HW/RDGV'VXEMHFWWRWKHSUHVVXUHDQG

WHPSHUDWXUHOLPLWDWLRQVJLYHQLQWKH185(* LHVWDJQDWLRQSUHVVXUHV

IURPSVLDWRSVLDWR)VXEFRROLQJDQGWRVWHDP

TXDOLW\\ )RUMHWVFRQVLVWLQJRIVWHDPRUVXEFRROHGOLTXLGZDWHUIDOOLQJ

RXWVLGHRIWKH185(*OLPLWDWLRQVWKHHIIHFWLYHOHQJWKRIWKHMHWLVSLSH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











GLDPHWHUV ,' 6LPLODUO\\MHWOHQJWKVIURP&ULWLFDO&UDFNVDUHOLPLWHGWR

SLSHGLDPHWHUV ,' 



x

7KUXVWOHDGVIRUHYDOXDWLQJSRWHQWLDOLQWHUDFWLRQVEHWZHHQSRVWXODWHG

+(/%VDQGWKH7%VWUXFWXUDOFRPSRQHQWVDUHGHWHUPLQHGLQDFFRUGDQFH

ZLWK$16, 5HY 



x

6\\VWHPVDQGFRPSRQHQWVZKRVHRQO\\IXQFWLRQLVWRVXSSRUWWKH

FRROGRZQRIWKHXQLWIURPDQ5&6WHPSHUDWXUHRIDSSUR[LPDWHO\\)WR

WKHFROGVKXWGRZQFRQGLWLRQQHHGQRWEHSURWHFWHGIURPSRVWXODWHG

+(/%V



x

$³/RVVRI2IIVLWH3RZHU' /223 LVQRWSRVWXODWHGXQOHVVWKHLQLWLDWLQJ

EUHDNGLUHFWO\\FDXVHVD/223



x

+(/%LQWHUDFWLRQVZLWKFDEOHVUHVXOWLQWKHDIIHFWHGFRPSRQHQW V IDLOLQJ

LQWKHPRVWXQGHVLUHGVWDWHRUDUHHYDOXDWHGIRUWKHHIIHFWVRIWKH

LQWHUDFWLRQ+RZHYHUWKHIROORZLQJH[FHSWLRQVDSSO\\,IDQHOHFWULF/RDG

&HQWHU /& RU0RWRU&RQWURO&HQWHU 0&& LVDIIHFWHGE\\LQWHUDFWLRQV

WKH/&RU0&&LVFRQVLGHUHGWREHGHHQHUJL]HG&RPSRQHQWVUHFHLYLQJ

SRZHUIURPWKLV/&RU0&&DUHFRQVLGHUHGGHHQHUJL]HGDQGXQDEOHWR

IXQFWLRQXQOHVVDOWHUQDWHSRZHUVXSSOLHVDUHDYDLODEOH9DOYHVGLUHFWO\\

SRZHUHGIURPDQDIIHFWHG0&&IDLO³DVLV'UHJDUGOHVVRIRWKHU

LQWHUDFWLRQV



x

7KH5HDFWRU7ULS%UHDNHUVDQGWKH&5'V\\VWHPFDQEHH[FOXGHGIURP

WKHOLVWRI6KXWGRZQ(TXLSPHQWFRPSRQHQWVDQGSRWHQWLDO+(/%WDUJHWV

EHFDXVHWKHXQLWWULSIXQFWLRQFDQEHFRQVLGHUHGWREHFRPSOHWHGSULRUWR

DQ\\SRWHQWLDOGHJUDGDWLRQRIWKHV\\VWHPGXHWRDQ\\JUDGXDODGYHUVH

HQYLURQPHQWDOHIIHFWVFDXVHGE\\SRVWXODWHG+(/%V





'(7(50,1$7,212)6$)(6+87'2:16<67(06



 +(/%0LWLJDWLRQ6WUDWHJ\\



7KH+(/%0LWLJDWLRQ6WUDWHJ\\DGGUHVVHVWKHOHYHORISURWHFWLRQSURYLGHGWR

V\\VWHPVVWUXFWXUHVDQGFRPSRQHQWV 66&V QHFHVVDU\\WRUHDFK66'IURPWKH

GLUHFWHIIHFWV SLSHZKLSDQGMHWLPSLQJHPHQW DQGLQGLUHFWHIIHFWV HQYLURQPHQWDO

DQGIORRGLQJ RIDJLYHQ+(/%RXWVLGHRIWKHFRQWDLQPHQWEXLOGLQJ7KHPDMRU

SRLQWVRIWKHVWUDWHJ\\DUHDVIROORZV



x

5HTXLUHG66&VORFDWHGLQWKH7%DUHQRWLPSDFWHGE\\+(/%VSRVWXODWHG

WRRFFXULQWKH$%RULQWKH\\DUG



x

5HTXLUHG66&VORFDWHGLQWKH$%DUHQRWLPSDFWHGE\\+(/%VSRVWXODWHG

WRRFFXULQWKH7%



x

6$)VDUHLPSRVHGIRUWKRVHFRPSRQHQWVUHTXLUHGIRULQLWLDOPLWLJDWLRQ

x

6$)VDUHQRWLPSRVHGIRUWKRVHFRPSRQHQWVUHTXLUHGWRLQLWLDWHD

FRROGRZQRIWKHSODQW

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21













x

+(/%VUHVXOWLQJLQWKHORVVRISODQWV\\VWHPVLQVLGHWKH7%QHHGHGIRU

66'DUHPLWLJDWHGE\\WKH3URWHFWHG6HUYLFH:DWHU 36: V\\VWHP VHH

8)6$56HFWLRQ 



x

6KRXOGWKH36:V\\VWHPEHXQDYDLODEOHWKH66) VHH8)6$56HFWLRQ

 LVFUHGLWHGDVDQDOWHUQDWHPHDQVRIDFKLHYLQJDQGPDLQWDLQLQJ66'

IROORZLQJ+(/%VWKDWGLVDEOHSODQWV\\VWHPVLQVLGHWKH7%



x

+(/%VUHVXOWLQJLQWKHORVVRISODQWV\\VWHPVLQVLGHWKH$%QHHGHGIRU

66'DUHPLWLJDWHGE\\QRUPDOSODQWV\\VWHPVRUWKH66)



x

$VDSSOLFDEOH185(*&5LVXVHGIRUWKHGHWHUPLQDWLRQRIMHW

LPSLQJHPHQWHIIHFWVIROORZLQJ+(/%VDQGFULWLFDOFUDFNV



x

([FOXVLRQRIV\\VWHPVZKRVHRSHUDWLQJWLPHDWKLJKHQHUJ\\FRQGLWLRQVLV

OHVVWKDQRIWKHWRWDOXQLWRSHUDWLQJWLPH



x

([FOXVLRQRIV\\VWHPVZKRVHRSHUDWLQJWLPHDWKLJKHQHUJ\\FRQGLWLRQVLV

OHVVWKDQDSSUR[LPDWHO\\RIWKHWRWDOV\\VWHPRSHUDWLQJWLPH



x

(OLPLQDWLRQRIDUELWUDU\\LQWHUPHGLDWHEUHDNVLQ$60(% 396HFWLRQ,,,

&ODVVDQG&ODVVHTXLYDOHQWSLSLQJ,QWHUPHGLDWHEUHDNVDUHSRVWXODWHG

ZKHUHFDOFXODWHGORQJLWXGLQDOVWUHVVIRUWKHDSSOLFDEOHORDGFDVHV LQWHUQDO

SUHVVXUHGHDGZHLJKW JUDYLW\\ WKHUPDODQGVHLVPLF 2%( FRQGLWLRQV 

H[FHHG 6D6K 



x

,QWHUPHGLDWHEUHDNVLQQRQULJRURXVO\\DQDO\\]HGSLSLQJDUHSRVWXODWHGLQ

DFFRUGDQFHZLWK%730(%6HFWLRQ%F  E L 



x

(OLPLQDWLRQRIFULWLFDOFUDFNVDWWKHPRVWDGYHUVHORFDWLRQLQ$60(% 39

6HFWLRQ,,,&ODVVDQG&ODVVHTXLYDOHQWSLSLQJ&ULWLFDOFUDFNVDUH

SRVWXODWHGDWD[LDOORFDWLRQVZKHUHWKHFDOFXODWHGVWUHVVIRUWKHDSSOLFDEOH

ORDGFDVHV LQWHUQDOSUHVVXUHGHDGZHLJKW JUDYLW\\ WKHUPDODQGVHLVPLF

2%( FRQGLWLRQV H[FHHG 6D6K &ULWLFDOFUDFNVDUHQRWSRVWXODWHG

DWORFDWLRQVRIWHUPLQDOHQGV



x

(OLPLQDWLRQRIFULWLFDOFUDFNVDWWKHPRVWDGYHUVHORFDWLRQLQWKHQRQ

ULJRURXVO\\DQDO\\]HGSLSLQJ7KHHIIHFWVRIWKHSRVWXODWHGLQWHUPHGLDWH

EUHDNVERXQGWKHHIIHFWVIURPFULWLFDOFUDFNV



x

+(/%VRFFXUULQJRXWVLGHRIWKH7%DQG$%DUHPLWLJDWHGE\\QRUPDOSODQW

V\\VWHPV



 6KXWGRZQ2EMHFWLYHV



+(/%VRXWVLGHRIWKHFRQWDLQPHQWEXLOGLQJPD\\RUPD\\QRWUHVXOWLQ

FRQVHTXHQFHVWKDWUHTXLUHDQDXWRPDWLFWULSRIWKHUHDFWRUDQGPDLQWXUELQH7KH

RSHUDWRUPD\\HOHFWWRWULSWKHUHDFWRUDQGPDLQWXUELQHIRUSHUVRQQHODQG

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











HTXLSPHQWSURWHFWLRQ7KHREMHFWLYHIRUHDFKVKXWGRZQLQWHUYDOLVSURYLGHG

EHORZ



7KHVKXWGRZQVHTXHQFHLVGLYLGHGLQWRIRXULQWHUYDOV



 6KXWGRZQRIWKH5HDFWRUDQG0DLQ7XUELQH



7KHREMHFWLYHLVWRSODFHWKHUHDFWRULQDVXEFULWLFDOVWDWHWRSURWHFW

WKHFRUH7KHPDLQWXUELQHPXVWEHWULSSHGWRSUHYHQWH[FHVVLYH

5&6FRROLQJ:LWKWKHH[FHSWLRQRIWKH06VXSSO\\WRWKHWXUELQH

GULYHQHPHUJHQF\\IHHGZDWHUSXPS 7'():3 WKHWULSSLQJRIWKH

PDLQWXUELQHDOVRVHSDUDWHVWKH06OLQHVIURPRQHDQRWKHUE\\

FORVXUHRIWKHPDLQWXUELQHVWRSYDOYHV



 (VWDEOLVKPHQWRIVWDEOH5&6FRQGLWLRQV



7KHREMHFWLYHLVWREDODQFHWKHKHDWJHQHUDWLRQLQWKH5&6ZLWK

WKHKHDWEHLQJUHPRYHGE\\WKH6WHDP*HQHUDWRUV 6*V VXFKWKDW

5&6WHPSHUDWXUHVFDQEHFRQWUROOHG7KLVLVDFFRPSOLVKHGE\\

PDLQWDLQLQJ5&6LQYHQWRU\\FRQWURODQGHVWDEOLVKLQJ5&6SUHVVXUH

FRQWUROVXFKWKDWFRXSOLQJZLWKWKH6*VFDQEHUHVWRUHGRU

PDLQWDLQHG6HFRQGO\\IHHGLQJDQGRUVWHDPLQJRIWKH6*VDUH

FRQWUROOHGLQDPDQQHUVXFKWKDWWKHDPRXQWRIKHDWJHQHUDWHGE\\

FRUHGHFD\\KHDWDQG5HDFWRU&RRODQW3XPS 5&3 KHDW LIVWLOO

UXQQLQJ LVEDODQFHGZLWKWKHKHDWUHPRYDOIURPWKH6*V)LQDOO\\

DVRXUFHRIERUDWHGZDWHUVXIILFLHQWWRPDLQWDLQWKHUHDFWRULQD

VXEFULWLFDOFRQGLWLRQLVDOLJQHGDQGXVHGWRVXSSO\\WKH5&6

'HSHQGLQJRQWKHH[WHQWRIGDPDJHIURPWKH+(/%DQGWKH

VWUDWHJ\\XVHGIRUPLWLJDWLRQVWDEOH5&6FRQGLWLRQVPD\\EH

PDLQWDLQHGXSWRKRXUVEHIRUHSODQWFRROGRZQZRXOGEH

LQLWLDWHG



,QLWLDWLRQRI5&6FRROGRZQWRDSSUR[)



7KHREMHFWLYHRIWKLVSKDVHLVWRLQLWLDWHDSODQWFRROGRZQIURPWKH

SRLQWZKHUH5&6FRQGLWLRQVDUHVWDELOL]HGWR/3,HQWU\\FRQGLWLRQV

7KH6*VDUHXWLOL]HGIRUSODQWFRROGRZQIURPQRUPDOSRVWUHDFWRU

WULSFRQGLWLRQVWRDSSUR[LPDWHO\\)7\\SLFDOO\\SODQWFRROGRZQ

ZRXOGEHYLDIRUFHGFLUFXODWLRQXVLQJDQ\\5&3,IDOORIWKH5&3V

DUHXQDYDLODEOHSURFHGXUHVDUHSURYLGHGWRLQLWLDWHDQDWXUDO

FLUFXODWLRQFRROGRZQ



 (VWDEOLVKPHQWRIWKHFROGVKXWGRZQFRQGLWLRQ 5&6WHPSHUDWXUH

) 



7KHREMHFWLYHRIWKLVSKDVHRISRVW+(/%RSHUDWLRQVLVWR

WUDQVLWLRQIURPGHFD\\KHDWUHPRYDOXVLQJWKH6*VWRUHPRYLQJ

FRUHGHFD\\KHDWXVLQJWKH/3,V\\VWHP7KH/3,V\\VWHPLQ

FRQMXQFWLRQZLWKWKHORZSUHVVXUHVHUYLFHZDWHUV\\VWHPLVXWLOL]HG

WRFRROWKH5&6IURPDSSUR[LPDWHO\\)WROHVVWKDQ)

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21













)XQFWLRQVWRPHHW6DIH6KXWGRZQ2EMHFWLYHV



7KLVVHFWLRQGHVFULEHVWKHIXQFWLRQVQHHGHGWRVDWLVI\\WKHVKXWGRZQREMHFWLYHV

IROORZLQJDSRVWXODWHG+(/%RXWVLGHRIWKHFRQWDLQPHQWEXLOGLQJ+(/%VRXWVLGH

RIWKHFRQWDLQPHQWEXLOGLQJFDQEHGLYLGHGLQWRWKUHHFDWHJRULHVWKRVHWKDWUHVXOW

LQDORVVRIKHDWWUDQVIHU ORVVRI6*IHHGZDWHU WKRVHWKDWUHVXOWLQH[FHVVLYH

KHDWWUDQVIHU ORVVRI06SUHVVXUHERXQGDU\\FRQWURO DQGWKRVHWKDWUHVXOWLQORVV

RIUHDFWRUFRRODQWLQYHQWRU\\ OHWGRZQOLQHEUHDN /RVVRIKHDWWUDQVIHUVFHQDULRV

UHVXOWLQDPLVPDWFKZKHUHPRUHKHDWLVJHQHUDWHGLQWKHFRUHWKDQLVUHPRYHG

E\\WKHVHFRQGDU\\V\\VWHP7KHVHVFHQDULRVOHDGWRDQLQFUHDVHLQ5&6

WHPSHUDWXUHDQGSUHVVXUH([FHVVLYHKHDWWUDQVIHUVFHQDULRVUHVXOWLQD

PLVPDWFKZKHUHPRUHKHDWLVUHPRYHGE\\WKHVHFRQGDU\\V\\VWHPWKDQLV

JHQHUDWHGLQWKHFRUH7KHVHVFHQDULRVOHDGWRDGHFUHDVHLQ5&6WHPSHUDWXUH

SUHVVXUHDQGZDWHUOHYHO GXHWRUHDFWRUFRRODQWVKULQNDJH /RVVRILQYHQWRU\\

VFHQDULRVKDYHDPLQRUHIIHFWRQWKH5&6GXHWRWKHLQVLJQLILFDQWDPRXQWRI

LQYHQWRU\\ORVW7KHV\\VWHPVQHFHVVDU\\WRUHDFK66'ZHUHVHOHFWHGEDVHGRQ

PHHWLQJWKHIROORZLQJ6KXWGRZQIXQFWLRQVIRUWKHFDWHJRULHVRI+(/%



x

5HDFWLYLW\\&RQWURO

x

5&6,QYHQWRU\\&RQWURO

x

5&63UHVVXUH&RQWURO

x

5&6+HDW5HPRYDO&RQWURO

x

5HDFWRU%XLOGLQJ %RXQGDU\\ ,QWHJULW\\

x

&RQWURO5RRP+DELWDELOLW\\ ORQJWHUP 

x

3ODQW&RROGRZQ

x

3URFHVV0RQLWRULQJ

x

6XSSRUW)XQFWLRQV



7KHOLFHQVHHSURSRVHGWRDGGQHZ6HFWLRQ³6DIHW\\(YDOXDWLRQ'DVIROORZV





6DIHW\\(YDOXDWLRQ



1RUPDOSODQWV\\VWHPVWKH36:V\\VWHPDQGWKH66)DUHFUHGLWHGIRUWKH

PLWLJDWLRQRI+(/%VRXWVLGHFRQWDLQPHQW0)':+(/%VUHVXOWLQRYHUKHDWLQJ

WUDQVLHQWV06+(/%VUHVXOWLQRYHUFRROLQJWUDQVLHQWV



7KHVDIHW\\DQDO\\VLVDFFHSWDQFHFULWHULDIRUHDFK+(/%WUDQVLHQWDUHDVIROORZV



2YHUKHDWLQJ$QDO\\VLV



x

7KHFRUHPXVWUHPDLQLQWDFWDQGLQDFRRODEOHJHRPHWU\\



x

0LQLPXPGHSDUWXUHIURPQXFOHDWHERLOLQJUDWLR '1%5 PHHWVVSHFLILHG

DFFHSWDEOHIXHOGHVLJQOLPLWV



x

5&6SUHVVXUHPXVWQRWH[FHHGSVLJ RIGHVLJQ 

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











2YHUFRROLQJ$QDO\\VLV



,QDGGLWLRQWRWKHFULWHULDVSHFLILHGDERYHWKHIROORZLQJFULWHULDDUHDSSOLFDEOH

YDOLGDWHG IRUWKHPRVWOLPLWLQJRYHUFRROLQJDQDO\\VHV



x

7KH6*WXEHVUHPDLQLQWDFW



x

5&6UHPDLQVZLWKLQDFFHSWDEOHSUHVVXUHDQGWHPSHUDWXUHOLPLWV



7KHERXQGLQJRYHUKHDWLQJWUDQVLHQWLVD0)':+(/%LQWKH7%UHVXOWLQJLQD

ORVVRIDOO9$&SRZHUWRQRUPDOSODQWV\\VWHPV7KHERXQGLQJRYHUFRROLQJ

WUDQVLHQWLVDGRXEOH06+(/%LQWKH7%UHVXOWLQJLQDORVVRIDOO9$&

SRZHUWRQRUPDOSODQWV\\VWHPV



7KH36:V\\VWHPLVFUHGLWHGIRUWKHPLWLJDWLRQRI+(/%VLQVLGHWKH7%ZKHQD

+(/%UHVXOWVLQWKHORVVRISODQWV\\VWHPVQHHGHGIRU66'7KH66)LVFUHGLWHG

DVDQDOWHUQDWHPHDQVIRUPLWLJDWLRQRI+(/%VLQVLGHWKH7%ZKHQD+(/%

UHVXOWVLQWKHORVVRISODQWV\\VWHPVQHHGHGIRU66'





36:5HVSRQVH)ROORZLQJD0)':+(/%LQWKH7%



7KHWUDQVLHQWEHJLQVZLWKDQLPPHGLDWHDQGFRPSOHWHORVVRI0)':IURPKRWIXOO

SRZHU +)3 FRQGLWLRQVZLWKDQLQLWLDOFRUHSRZHUOHYHORIRI0:DV

ZHOODVDORVVRIWKH9$&VZLWFKJHDU7KLVFDXVHVDQLPPHGLDWHUHDFWRU

WULSDQGWXUELQHWULSGXHWRWKHORVVRISRZHU7KH5&3VFRQWLQXHWRRSHUDWHXQWLO

RSHUDWRUDFWLRQLVWDNHQWRWULSWKHPHLWKHUPLQXWHVDIWHUDORVVRILQGLFDWHG

VXEFRROHGPDUJLQRUPLQXWHVDIWHUDORVVRI5&3VHDOFRROLQJ7KHPRWRU

GULYHQHPHUJHQF\\IHHGZDWHUSXPSV 0'():3 DUHSRZHUHGIURPWKH9$&

VZLWFKJHDUDQGDUHQRWDYDLODEOH7KH7'():3LVDVVXPHGWREHXQDYDLODEOH



6LQFHSRUWLRQVRIWKHLQWHJUDWHGFRQWUROV\\VWHP ,&6 DUHXQSURWHFWHGIURP+(/%

GDPDJHWKHSUHVVXUL]HUSRZHURSHUDWHGUHOLHIYDOYH 3259 LVDVVXPHGWREH

XQDYDLODEOH7KHFRPELQDWLRQRIKLJKHQGRIF\\FOHGHFD\\KHDWDQGGHOD\\HG36:

IORZWRWKH6*VFDXVHVDODUJHRYHUKHDWLQJWUDQVLHQWLQWKHSULPDU\\V\\VWHPDQGD

UDSLGLQFUHDVHLQ5&6SUHVVXUH5&6SUHVVXUHLQFUHDVHVWRWKHSUHVVXUL]HU

VDIHW\\YDOYH 369 OLIWVHWWLQJDQGWKH369VF\\FOHWRFRQWURO5&6SUHVVXUHXQWLO

RSHUDWRUVHVWDEOLVK36:IORZPLQXWHVLQWRWKHHYHQW36:LVDVVXPHGWREH

DYDLODEOHDWPLQXWHVLQWKHRYHUKHDWLQJDQDO\\VLVWRSUHYHQWOLTXLGUHOLHIWKURXJK

WKH369V7KHSHDN5&6SUHVVXUHLQWKHRYHUKHDWLQJDQDO\\VLVLVGHILQHGE\\WKH

SUHVVXUL]HUVDIHW\\UHOLHIYDOYHFKDUDFWHULVWLFVVLQFHWKH3259LVQRWDYDLODEOH

LWKDQLPPHGLDWHUHDFWRUWULSWKHUDWHRI5&6SUHVVXUL]DWLRQLVVXFKWKDW

PD[LPXPSUHVVXUHRFFXUVGXULQJWKHILUVW369OLIW7KHPD[LPXPSUHVVXUH

REVHUYHGUHPDLQVEHORZWKHSVLJOLPLW7KXVWKHSHDN5&6SUHVVXUH

UHVXOWVREWDLQHGDUHQRWFRQWLQJHQWRQWKHWLPLQJRI36:IORZ



6XFFHVVIXOPLWLJDWLRQRID+(/%FRQGLWLRQDW216VKDOOEHGHILQHGDVHQVXULQJ

WKDWWKHLQWHJULW\\RIWKHIXHODQG5&6UHPDLQVXQFKDOOHQJHG)RUWKHRYHUKHDWLQJ

DQDO\\VLVWKHIXHOLQWHJULW\\LVHQVXUHGE\\WKHUHDFWLYLW\\DGGHGYLDFRQWUROURG

LQVHUWLRQDQGPDLQWDLQLQJWKHFRUHFRYHUHG$PLQLPXP'1%5HYDOXDWLRQLVQRW

UHTXLUHGIRUWKLVDQDO\\VLVVLQFHWKHWUDQVLHQWGRHVQRWLQFOXGHDUHWXUQWRSRZHU

DQGWKH'1%5DWUHDFWRUWULSLVERXQGHGE\\WKHH[LVWLQJ8)6$5&KDSWHU

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











DQDO\\VHV5&6LQWHJULW\\LVGHPRQVWUDWHGE\\YHULI\\LQJWKH5&6SUHVVXUHUHPDLQV

EHORZWKHSVLJOLPLW



,QVXPPDU\\WKHUHVXOWVRIWKHDQDO\\VLVGHPRQVWUDWHWKDW36:LVFDSDEOHRI

HQVXULQJSHDN5&6SUHVVXUHUHPDLQVEHORZWKHSVLJOLPLW$GGLWLRQDOO\\WKH

UHVXOWVGHPRQVWUDWHWKHUHLVVXIILFLHQWGHFD\\KHDWUHPRYDO '+5 DQGSULPDU\\

FRRODQWPDNHXSWRNHHSWKHFRUHFRYHUHGDQGPDLQWDLQWKH5&6LQ0RGHIRU

WKHGXUDWLRQRIWKHVFHQDULR





66)5HVSRQVH)ROORZLQJD0)':+(/%LQWKH7%



7KHWUDQVLHQWEHJLQVZLWKDQLPPHGLDWHDQGFRPSOHWHORVVRI0)':IURP+)3

FRQGLWLRQVZLWKDQLQLWLDOFRUHSRZHUOHYHORIRI0:DVZHOODVDORVV

RIWKH9$&VZLWFKJHDU7KLVFDXVHVDQLPPHGLDWHUHDFWRUWULSDQGWXUELQH

WULSGXHWRWKHORVVRISRZHU7KH5&3VFRQWLQXHWRRSHUDWHXQWLORSHUDWRUDFWLRQ

LVWDNHQWRWULSWKHPHLWKHUPLQXWHVDIWHUDORVVRILQGLFDWHGVXEFRROHGPDUJLQ

RUPLQXWHVDIWHUORVVRI5&3VHDOFRROLQJ7KH0'():3VDUHSRZHUHGIURP

WKH9$&VZLWFKJHDUDQGDUHQRWDYDLODEOHGXHWRWKHORVVRISRZHU7KH

7'():3LVDVVXPHGWREHXQDYDLODEOH



6LQFHSRUWLRQVRIWKH,&6DUHXQSURWHFWHGIURP+(/%GDPDJHWKHSUHVVXUL]HU

3259LVDVVXPHGWREHXQDYDLODEOH7KHFRPELQDWLRQRIKLJKHQGRIF\\FOH

GHFD\\KHDWDQGGHOD\\HG66)DX[LOLDU\\VHUYLFHZDWHU $6: IORZWRWKH6*V

FDXVHDODUJHRYHUKHDWLQJWUDQVLHQWLQWKHSULPDU\\V\\VWHPDQGDUDSLGLQFUHDVHLQ

5&6SUHVVXUH5&6SUHVVXUHLQFUHDVHVWRWKH369OLIWVHWWLQJDQGWKH369V

F\\FOHWRFRQWURO5&6SUHVVXUHXQWLORSHUDWRUVHVWDEOLVK66)$6:IORZ

PLQXWHVLQWRWKHHYHQW7KHSHDN5&6SUHVVXUHLQWKHRYHUKHDWLQJDQDO\\VLVLV

GHILQHGE\\WKHSUHVVXUL]HUVDIHW\\UHOLHIYDOYHFKDUDFWHULVWLFVVLQFHWKH3259LV

QRWDYDLODEOH:LWKDQLPPHGLDWHUHDFWRUWULSWKHUDWHRI5&6SUHVVXUL]DWLRQLV

VXFKWKDWWKHPD[LPXPSUHVVXUHRFFXUVGXULQJWKHILUVW369OLIW7KHPD[LPXP

SUHVVXUHREVHUYHGUHPDLQVEHORZWKHSVLJOLPLW7KXVWKHSHDN5&6

SUHVVXUHUHVXOWVREWDLQHGDUHQRWFRQWLQJHQWRQWKHWLPLQJRI66)$6:IORZ



6XFFHVVIXOPLWLJDWLRQRID+(/%VKDOOEHGHILQHGDVHQVXULQJWKDWWKHLQWHJULW\\RI

WKHIXHODQG5&6UHPDLQVXQFKDOOHQJHG)RUWKHRYHUKHDWLQJDQDO\\VLVWKHIXHO

LQWHJULW\\LVHQVXUHGE\\WKHUHDFWLYLW\\DGGHGYLDFRQWUROURGLQVHUWLRQDQG

PDLQWDLQLQJWKHFRUHFRYHUHG$PLQLPXP'1%5HYDOXDWLRQLVQRWUHTXLUHGIRU

WKLVDQDO\\VLVVLQFHWKHWUDQVLHQWGRHVQRWLQFOXGHDUHWXUQWRSRZHUDQGWKH'1%5

DWUHDFWRUWULSLVERXQGHGE\\WKHH[LVWLQJ8)6$5&KDSWHUDQDO\\VHV5&6

LQWHJULW\\LVGHPRQVWUDWHGE\\YHULI\\LQJWKH5&6SUHVVXUHUHPDLQVEHORZWKH

SVLJOLPLW



,QVXPPDU\\WKHUHVXOWVRIWKHDQDO\\VLVGHPRQVWUDWHWKDWWKH66)LVFDSDEOHRI

HQVXULQJSHDN5&6SUHVVXUHUHPDLQVEHORZWKHSVLJOLPLW$GGLWLRQDOO\\WKH

UHVXOWVGHPRQVWUDWHWKHUHLVVXIILFLHQW'+5DQGSULPDU\\FRRODQWPDNHXSWRNHHS

WKHFRUHFRYHUHGDQGPDLQWDLQWKH5&6LQ0RGHIRUWKHGXUDWLRQRIWKH

VFHQDULR

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21













36:5HVSRQVH)ROORZLQJD'RXEOH06+(/%LQWKH7%



7KLVDQDO\\VLVGHWHUPLQHVWKHSODQWWUDQVLHQWUHVSRQVHWRDGRXEOH06+(/%

PLWLJDWHGZLWK36:HTXLSPHQWDQGZLWKRXWFUHGLWIRUWKHDXWRPDWLFIHHGZDWHU

LVRODWLRQV\\VWHP $),6 7KLVDQDO\\VLVDVVXPHVDQLQLWLDOFRUHSRZHUOHYHORI

RI0:DW+)3FRQGLWLRQV7KHLQLWLDWLQJHYHQWFDXVHVGRXEOH06

+(/%DQLPPHGLDWHORVVRI9$&SRZHUDUHDFWRUWULSDWXUELQHWULSDQGD

WULSRIDOOFRQGHQVDWHDQG0)':SXPSV7KH5&3VFRQWLQXHWRRSHUDWHXQWLO

RSHUDWRUDFWLRQLVWDNHQWRWULSWKHPHLWKHUPLQXWHVDIWHUDORVVRILQGLFDWHG

VXEFRROHGPDUJLQRUPLQXWHVDIWHUDORVVRI5&3VHDOFRROLQJ7KH0'():3V

DUHQRWDYDLODEOHGXHWRWKHORVVRI9$&SRZHU7RPD[LPL]HWKH

RYHUFRROLQJWKH7'():3LVDVVXPHGWRDXWRPDWLFDOO\\VWDUWDQGUXQZLWKRXW

EHLQJWKURWWOHGXQWLOWKHFRQWHQWVRIWKHXSSHUVXUJHWDQN 867 DUHGHOLYHUHGWR

WKH6*V7KLVVFHQDULRLVLQWHQGHGWRERXQGWKHFRQVHTXHQFHVUHVXOWLQJIURPD

GRXEOH06+(/%



7KHSULPDU\\REMHFWLYHRIWKLVDQDO\\VLVLVWRGHPRQVWUDWHWKDWWKHPLQLPXP'1%5

LVDFFHSWDEOHDQGWKDWWKHSODQWZLOODFKLHYHDVWHDG\\VWDWHFRQGLWLRQZKHUHWKH

5&6LVLQQDWXUDOFLUFXODWLRQIORZFRQGLWLRQVZLWK36:SURYLGLQJDKHDWVLQND

36:SRZHUHG+3,SXPSSURYLGLQJVHDOLQMHFWLRQIORZ5&6SUHVVXUHEHLQJ

PDLQWDLQHGZLWKWKH36:SRZHUHGSUHVVXUL]HUKHDWHUVDQGSUHVVXUL]HUOHYHO

EHLQJFRQWUROOHGE\\RSHUDWLRQRIWKHORRSKLJKSRLQWYHQWVDQGRU36:IORZ7KLV

DVVXUHVWKDWWKHFRUHUHPDLQVLQWDFWDQGLQDFRRODEOHJHRPHWU\\



7KHGRXEOH06+(/%FDXVHVWKH5&6WRGHSUHVVXUL]HDQGVKULQN$V5&6

SUHVVXUHGHFUHDVHVWKHWZR&)7VLQMHFWDGGLWLRQDOERUDWHGLQYHQWRU\\LQWRWKH

5&67KHFRUHUHPDLQVFRYHUHGWKURXJKRXWWKHRYHUFRROLQJWUDQVLHQW7KH

VXVWDLQHGRYHUFRROLQJLQWKHDIIHFWHGORRSLVQRWVXIILFLHQWWRUHVXOWLQDUHWXUQWR

FULWLFDOLW\\7KHFRUHUHPDLQVVXEFULWLFDODIWHUWKHURGVLQVHUWIRUWKHGXUDWLRQRIWKH

WUDQVLHQW7KHFRUHUHPDLQVFRYHUHGDQGFRROHGIRUWKHGXUDWLRQRIWKHWUDQVLHQW

7KH36:SRZHUHG+3,SXPSLVVWDUWHGWRUHVWRUH5&3VHDOFRROLQJDQGPDNHXS

WRWKH5&636:IORZLVDYDLODEOHDWPLQXWHVEXWQRWGHOLYHULQJIORZWRWKH

6*VDWWKLVWLPHGXHWRWKHRYHUFRROLQJ7KHRYHUFRROLQJFRQWLQXHVXQWLOVKRUWO\\

DIWHUWKH7'():3VWRSVIHHGLQJWKH6*V



$IWHUWKHRYHUFRROLQJKDVWHUPLQDWHGWKH5&6EHJLQVWRVORZO\\UHKHDWDQGVZHOO

SUHVVXUL]HUOHYHOUHWXUQVRQVFDOHDQGWKH36:SRZHUHGSUHVVXUL]HUKHDWHUVDUH

PDQXDOO\\HQHUJL]HG36:IORZLVHVWDEOLVKHGWRWKH6*VWRVWDELOL]H5&6

WHPSHUDWXUHDQGSUHVVXUL]HUOHYHO6DWXUDWHGFRQGLWLRQVDUHHVWDEOLVKHGLQWKH

SUHVVXUL]HUDQGSUHVVXUL]HUKHDWHUVDUHWKHQF\\FOHGWRPDLQWDLQ5&6SUHVVXUH

VWDEOH6WDEOHVXEFRROHGQDWXUDOFLUFXODWLRQFRQGLWLRQVDUHDFKLHYHG

DSSUR[LPDWHO\\WKUHHKRXUVLQWRWKHWUDQVLHQW



6XFFHVVIXOPLWLJDWLRQRID+(/%FRQGLWLRQDW216VKDOOEHGHILQHGDVHQVXULQJ

WKDWWKHLQWHJULW\\RIWKHIXHODQG5&6UHPDLQVXQFKDOOHQJHG)RUWKHRYHUFRROLQJ

DQDO\\VLVWKHIXHOLQWHJULW\\LVFRQILUPHGE\\WKH'1%5DQDO\\VLV



5&6LQWHJULW\\LVGHPRQVWUDWHGE\\GHWHUPLQLQJWKHOLPLWLQJ6*WXEHFRPSUHVVLYH

DQGWHQVLOHVWUHVVHVUHPDLQZLWKGHVLJQOLPLWVDQGWKDWWKH5&6SUHVVXUHDQG

WHPSHUDWXUHUHPDLQVZLWKLQWKHDFFHSWDEOHFRROGRZQOLPLWVGXULQJWKHWUDQVLHQW

HYROXWLRQ7KHWLPHGHSHQGHQW6*WXEHDQG6*VKHOOWHPSHUDWXUHVDUH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











GHWHUPLQHGXVLQJDOLQHDUDYHUDJHWRGHWHUPLQHLIWKHWHPSHUDWXUHGLIIHUHQFHV

UHPDLQZLWKLQWKH6*GHVLJQOLPLWV7KHUHVXOWVLQGLFDWHWKH6*WXEHVWUHVV

UHPDLQVZHOOZLWKLQWKHHVWDEOLVKHGOLPLWVIRUWKHGXUDWLRQRIWKHWUDQVLHQW7KH

FRROGRZQSHUIRUPHGWKURXJKRSHUDWRUFRQWURORI36:WREHORZ)ZLOOSURYLGH

PDUJLQWRSUHYHQWWXEHGHIRUPDWLRQ



7KLVDQDO\\VLVGHPRQVWUDWHVWKDWDGRXEOH06+(/%FDQEHPLWLJDWHGXVLQJ36:

HTXLSPHQW,QVXPPDU\\WKHRYHUFRROLQJDQDO\\VLVGHPRQVWUDWHVWKDWIRUDGRXEOH

06+(/%VFHQDULRWKHIROORZLQJDFFHSWDQFHFULWHULDDUHVDWLVILHG



x

7KHFRUHUHPDLQVLQWDFWDQGLQDFRRODEOHJHRPHWU\\



x

0LQLPXP'1%5PHHWVVSHFLILHGDFFHSWDEOHIXHOGHVLJQOLPLWV



x

7KH6*WXEHVUHPDLQLQWDFW



x

5&6SUHVVXUHGRHVQRWH[FHHGSVLJDQG



x

5&6UHPDLQVZLWKLQDFFHSWDEOHSUHVVXUHDQGWHPSHUDWXUHOLPLWV





66)5HVSRQVH)ROORZLQJD'RXEOH06+(/%LQWKH7%



7KLVDQDO\\VLVGHWHUPLQHVWKHSODQWWUDQVLHQWUHVSRQVHWRDGRXEOH06+(/%

PLWLJDWHGZLWK66)HTXLSPHQWDQGZLWKRXWFUHGLWIRU$),67KLVDQDO\\VLV

DVVXPHVDQLQLWLDOFRUHSRZHUOHYHORIRI0:DW+)3FRQGLWLRQV7KH

LQLWLDWLQJHYHQWFDXVHVHLWKHUDVLQJOHRUGRXEOH06+(/%DQLPPHGLDWHORVVRI

9$&SRZHUDUHDFWRUWULSDWXUELQHWULSDQGDWULSRIDOOFRQGHQVDWHDQG

0)':SXPSV7KH5&3VFRQWLQXHWRRSHUDWHXQWLORSHUDWRUDFWLRQLVWDNHQWR

WULSWKHPHLWKHUPLQXWHVDIWHUDORVVRILQGLFDWHGVXEFRROHGPDUJLQRU

PLQXWHVDIWHUDORVVRI5&3VHDOFRROLQJ7KH0'():3DUHQRWDYDLODEOHGXHWR

WKHORVVRI9$&SRZHU7RPD[LPL]HWKHRYHUFRROLQJWKH7'():3LV

DVVXPHGWRDXWRPDWLFDOO\\VWDUWDQGUXQZLWKRXWEHLQJWKURWWOHGXQWLOWKHFRQWHQWV

RIWKH867DUHGHOLYHUHGWRWKH6*V7KLVVFHQDULRLVLQWHQGHGWRERXQGWKH

FRQVHTXHQFHVUHVXOWLQJIURPD06+(/%



7KHSULPDU\\REMHFWLYHRIWKLVDQDO\\VLVLVWRGHPRQVWUDWHWKDWWKHPLQLPXP'1%5

LVDFFHSWDEOHDQGWKDWWKHSODQWZLOODFKLHYHDVWHDG\\VWDWHFRQGLWLRQZKHUHWKH

5&6LVLQQDWXUDOFLUFXODWLRQIORZFRQGLWLRQVZLWK66)$6:SURYLGLQJDKHDWVLQN

66)UHDFWRUFRRODQWPDNHXS 5&08 IORZSURYLGLQJVHDOLQMHFWLRQIORZ5&6

SUHVVXUHEHLQJPDLQWDLQHGZLWKWKH66)SRZHUHGSUHVVXUL]HUKHDWHUVDQG

SUHVVXUL]HUOHYHOEHLQJFRQWUROOHGE\\RSHUDWLRQRIWKH66)OHWGRZQOLQHDQGRU

66)$6:7KLVDVVXUHVWKDWWKHFRUHUHPDLQVLQWDFWDQGLQDFRRODEOHJHRPHWU\\



7KHGRXEOH06+(/%FDXVHVWKH5&6WRGHSUHVVXUL]HDQGVKULQN$V5&6

SUHVVXUHGHFUHDVHVWKHWZR&)7VLQMHFWDGGLWLRQDOERUDWHGLQYHQWRU\\LQWRWKH

5&67KHFRUHUHPDLQVFRYHUHGWKURXJKRXWWKHRYHUFRROLQJWUDQVLHQW:KLOHD

EULHIUHFULWLFDOLW\\LVLQGLFDWHGWKHUHVXOWLQJILVVLRQSRZHUREWDLQHGLVQRWVLJQLILFDQW

OHVVWKDQRQHZDWW 7KH66)5&08SXPSLVVWDUWHGWRUHVWRUH5&3VHDO

FRROLQJDQGPDNHXSWRWKH5&666)$6:IORZLVDYDLODEOHDWPLQXWHVEXW

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











QRWGHOLYHULQJIORZWRWKH6*VDWWKLVWLPHGXHWRWKHRYHUFRROLQJ7KH

RYHUFRROLQJFRQWLQXHVXQWLOVKRUWO\\DIWHUWKH7'():3VWRSVIHHGLQJWKH6*V



$IWHUWKHRYHUFRROLQJKDVWHUPLQDWHGWKH5&6EHJLQVWRVORZO\\UHKHDWDQGVZHOO

SUHVVXUL]HUOHYHOUHWXUQVRQVFDOHDQGWKH66)SRZHUHGSUHVVXUL]HUKHDWHUVDUH

PDQXDOO\\HQHUJL]HG66)$6:IORZLVHVWDEOLVKHGWRWKH6*VWRVWDELOL]H5&6

WHPSHUDWXUHDQGSUHVVXUL]HUOHYHO6DWXUDWHGFRQGLWLRQVDUHHVWDEOLVKHGLQWKH

SUHVVXUL]HUDQGSUHVVXUL]HUKHDWHUVDUHWKHQF\\FOHGWRPDLQWDLQ5&6SUHVVXUH

VWDEOH6WDEOHVXEFRROHGQDWXUDOFLUFXODWLRQFRQGLWLRQVDUHDFKLHYHG

DSSUR[LPDWHO\\WKUHHKRXUVLQWRWKHWUDQVLHQW



6XFFHVVIXOPLWLJDWLRQRID+(/%FRQGLWLRQDW216VKDOOEHGHILQHGDVHQVXULQJ

WKDWWKHLQWHJULW\\RIWKHIXHODQG5&6UHPDLQVXQFKDOOHQJHG)RUWKHRYHUFRROLQJ

DQDO\\VLVWKHIXHOLQWHJULW\\LVGHPRQVWUDWHGE\\WKH'1%5DQDO\\VLV



5&6LQWHJULW\\LVGHPRQVWUDWHGE\\GHWHUPLQLQJWKHOLPLWLQJ6*WXEHFRPSUHVVLYH

DQGWHQVLOHVWUHVVHVUHPDLQZLWKGHVLJQOLPLWVDQGWKDWWKH5&6SUHVVXUHDQG

WHPSHUDWXUHUHPDLQVZLWKLQWKHDFFHSWDEOHFRROGRZQOLPLWVGXULQJWKHWUDQVLHQW

HYROXWLRQ7KHWLPHGHSHQGHQW6*WXEHDQG6*VKHOOWHPSHUDWXUHVDUH

GHWHUPLQHGXVLQJDOLQHDUDYHUDJHWRGHWHUPLQHLIWKHWHPSHUDWXUHGLIIHUHQFHV

UHPDLQZLWKLQWKH6*GHVLJQOLPLWV7KHUHVXOWVLQGLFDWHWKH6*WXEHVWUHVV

UHPDLQVZHOOZLWKLQWKHHVWDEOLVKHGOLPLWVIRUWKHGXUDWLRQRIWKHVFHQDULR7KH

FRROGRZQSHUIRUPHGWKURXJKRSHUDWRUFRQWURORI66)$6:WREHORZ)ZLOO

SURYLGHPDUJLQWRSUHYHQWWXEHGHIRUPDWLRQ



7RYDOLGDWHWKDW5&6SUHVVXUHDQGWHPSHUDWXUHUHPDLQZLWKLQOLPLWVWKHVH

SDUDPHWHUVDUHSORWWHGYHUVXVHDFKRWKHUWRH[DPLQHWKHWLPHGHSHQGHQW

UHVSRQVH7KHVHUHVXOWVLQGLFDWHVLJQLILFDQWPDUJLQLVPDLQWDLQHGWRWKH

DFFHSWDEOHFRROGRZQOLPLWVGXULQJWKHVFHQDULR



7KLVDQDO\\VLVGHPRQVWUDWHVWKDWDGRXEOH06+(/%FDQEHPLWLJDWHGXVLQJ66)

HTXLSPHQW,QVXPPDU\\WKHRYHUFRROLQJDQDO\\VLVGHPRQVWUDWHVWKDWIRUDGRXEOH

06+(/%VFHQDULRWKHIROORZLQJDFFHSWDQFHFULWHULDDUHVDWLVILHG



x

7KHFRUHUHPDLQVLQWDFWDQGLQDFRRODEOHJHRPHWU\\



x

0LQLPXP'1%5PHHWVVSHFLILHGDFFHSWDEOHIXHOGHVLJQOLPLWV



x

7KH6*WXEHVUHPDLQLQWDFW



x

5&6SUHVVXUHGRHVQRWH[FHHGSVLJDQG



x

5&6UHPDLQVZLWKLQDFFHSWDEOHSUHVVXUHDQGWHPSHUDWXUHOLPLWV



7KHOLFHQVHHSURSRVHGWRUHQXPEHUFXUUHQW6HFWLRQ³5HIHUHQFHV'WR

6HFWLRQDQGWRPDNHWKHIROORZLQJFKDQJHV

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21













5HIHUHQFHV



'XNH3RZHU% :5HSRUW2FRQHH1XFOHDU6WDWLRQ³(YDOXDWLRQRI

3RWHQWLDOO\\$GYHUVH(QYLURQPHQWDO(IIHFWVRQ1RQ 6DIHW\\*UDGH&RQWURO

6\\VWHPV'2FWREHU8615&6WDQGDUG5HYLHZ3ODQ 185(*

 6HFWLRQ%UDQFK7HFKQLFDO3RVLWLRQ$6%



><<@



 &ODULILFDWLRQ/HWWHU UHODWHGWRWKH'HFHPEHUOHWWHU GDWHG

-DQXDU\\IURP$6FKZHQFHU $(& WR$&7KLHV '3& 



+(/%2XWVLGH&RQWDLQPHQW:DONGRZQ&ULWHULD 5HTXLUHPHQWV216

8QLWV 



&DOFXODWLRQ26&+/-1RUPDO2SHUDWLQJ&RQGLWLRQVIRU+LJK(QHUJ\\

/LQH%UHDN +(/% $QDO\\VLV 2168QLWV  



266+/-'HVLJQ%DVLV6SHFLILFDWLRQIRUWKH³3LSH

5XSWXUH'+/-2168QLWV 



15&*HQHULF/HWWHU5HOD[DWLRQLQ$UELWUDU\\,QWHUPHGLDWH3LSH

5XSWXUH5HTXLUHPHQWV 5HYRI%730(% -XQH



'XNH(QHUJ\\&DOFXODWLRQ26&$QDO\\VLVRI3RVWXODWHG+(/%V

2XWVLGHRI&RQWDLQPHQW



/HWWHUIURP$*LDPEXVVR $(& WR$&7KLHV 'XNH3RZHU

&RPSDQ\\ ³*HQHUDO,QIRUPDWLRQ5HTXLUHGIRU&RQVLGHUDWLRQRIWKH

(IIHFWVRID3LSLQJ6\\VWHP%UHDN2XWVLGH&RQWDLQPHQW'GDWHG

'HFHPEHU



7KHOLFHQVHHSURSRVHGWRDGGWKHIROORZLQJSDUDJUDSKWRWKHHQGRI6HFWLRQ

³1DWXUDO&LUFXODWLRQ'



7KHHIIHFWVRID+(/%PD\\GULYHDXQLWWRDQDYHUDJHUHDFWRUFRRODQW

WHPSHUDWXUHOHVVWKDQR)7KHVXEVHTXHQWPLQRUUHGXFWLRQLQ5&6

WHPSHUDWXUHUHTXLUHGWRFRPSHQVDWHIRUWKHLQFUHDVHLQ5&6LQYHQWRU\\E\\WKH

66)5&08SXPSGXULQJSODQWVWDELOL]DWLRQGRHVQRWFRQVWLWXWHDQDWXUDO

FLUFXODWLRQFRROGRZQUHTXLULQJXVHRIWKHUHDFWRUYHVVHOKHDGYHQW5HIHUWR

5HIHUHQFHIRUDGGLWLRQDOLQIRUPDWLRQ



7KHOLFHQVHHSURSRVHGWRDGGWKHIROORZLQJUHIHUHQFHWRWKHQHZOLFHQVHDPHQGPHQWVWKDWDUH

WKHVXEMHFWRIWKLV6(WR6HFWLRQ³5HIHUHQFHV'RIWKH8)6$5 ZLWKLQIRUPDWLRQWREH

XSGDWHGZLWKWKHDPHQGPHQWQXPEHUVDQGWKHLUGDWHRILVVXDQFH 





/LFHQVH$PHQGPHQW1R;;;;;;DQG;;; GDWHRILVVXDQFH+/-0RQWK;;

;; +(/%0LWLJDWLRQ



7KHOLFHQVHHSURSRVHGWRDGGWKHIROORZLQJWH[WWRWKHHQGRIWKHWKLUGSDUDJUDSKLQ

6HFWLRQ³*HQHUDO'HVFULSWLRQ'RIWKH8)6$5

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











$KLJKHQHUJ\\OLQHEUHDN +(/% OLFHQVLQJEDVLVUHFRQVWLWXWLRQHIIRUWWKDWEHJDQLQWKH

HDUO\\VUHVXOWHGLQWKH66)EHLQJFUHGLWHGDVDQDOWHUQDWHPHDQVWRDFKLHYHDQG

PDLQWDLQVDIHVKXWGRZQIROORZLQJ+(/%VLQWKHWXUELQHEXLOGLQJDQGDX[LOLDU\\EXLOGLQJ



7KHOLFHQVHHSURSRVHGWRDGGWKHIROORZLQJWH[WWRWKHILIWKSDUDJUDSKLQ6HFWLRQ

RIWKH8)6$5



><<@7KH66)UHTXLUHVPDQXDODFWLYDWLRQWKDWZRXOGRFFXUXQGHUDGYHUVHILUHIORRGLQJ

+(/%RU><<@



7KHOLFHQVHHSURSRVHGWRDGGWKHIROORZLQJKHDGLQJDQGWH[WLQ6HFWLRQRIWKH

8)6$5



+(/%'HVLJQ&ULWHULD



$VDUHVXOWRID+(/%OLFHQVLQJEDVLVUHFRQVWLWXWLRQSHUIRUPHGLQWKHHDUO\\VWKH

66)LVFUHGLWHGIRUPHHWLQJWKHGHVLJQUHTXLUHPHQWVRIFHUWDLQ+(/%ORFDWLRQV7KH

66)SURYLGHVDQDOWHUQDWHPHDQVWRDFKLHYHDQGPDLQWDLQVDIHVKXWGRZQIROORZLQJ

+(/%VLQWKHWXUELQHEXLOGLQJDQGDX[LOLDU\\EXLOGLQJ6HH6HFWLRQIRUPRUHGHWDLOVRQ

WKHGHVLJQFULWHULDRI+(/%VRXWVLGHFRQWDLQPHQW



7KHOLFHQVHHSURSRVHGWRUHYLVH6HFWLRQ³2SHUDWLRQDQG7HVWLQJ'RIWKH

8)6$5DVIROORZV



7KH66)ZLOOEHSODFHGLQWRRSHUDWLRQWRPLWLJDWHWKHFRQVHTXHQFHVRIWKHIROORZLQJ

HYHQWVFULWHULRQ



 )ORRGLQJ

 )LUH

 6DERWDJH

 6WDWLRQ%ODFNRXW

 +LJK(QHUJ\\/LQH%UHDN

><<@



)RUIORRGLQJVDERWDJHVWDWLRQEODFNRXWKLJKHQHUJ\\OLQHEUHDNDQGWKRVHILUHHYHQWV

ZKHUHWKH66)LVFUHGLWHGIRUVDIHVKXWGRZQRSHUDWRUVZLOOEHVHQWWRWKH66)><<@



7KHOLFHQVHHSURSRVHGWRUHYLVH6HFWLRQ³*HQHUDO'HVFULSWLRQ'RIWKH8)6$5

DVIROORZV



><<@)RUFHUWDLQVFHQDULRVLQVLGHWKH7XUELQH%XLOGLQJ 7% UHVXOWLQJLQORVVRI9

HVVHQWLDOSRZHUHLWKHUWKH66)RU36:6\\VWHPLVXVHGIRUUHDFKLQJVDIHVKXWGRZQ

)RU+(/%VVHH8)6$56HFWLRQ ><<@



7KHOLFHQVHHSURSRVHGWRUHYLVH6HFWLRQ³'HVLJQ%DVHV'RIWKH8)6$5DV

IROORZV



><<@7KHHIIHFWVRI+LJK(QHUJ\\/LQH%UHDNVKDYHEHHQDQDO\\]HGDVDGGUHVVHGLQ

8)6$56HFWLRQ><<@

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











7KHOLFHQVHHSURSRVHGWRUHYLVH6HFWLRQ³6DIHW\\(YDOXDWLRQ'RIWKH8)6$5

DVIROORZV



><<@5HGXQGDQF\\LVSURYLGHGZLWKVHSDUDWHIXOOFDSDFLW\\PRWRUDQGWXUELQHGULYHQSXPS

VXEV\\VWHPV([FHSWDVQRWHGLQWKHVXEVHFWLRQVWKDWIROORZ6HFWLRQIDLOXUHRI

HLWKHUWKH0'():3VRUWKH7'():3ZLOOQRWUHGXFHWKH():6\\VWHPEHORZPLQLPXP

UHTXLUHGFDSDFLW\\3XPSFRQWUROVLQVWUXPHQWDWLRQDQGPRWLYHSRZHUDUHVHSDUDWHLQ

GHVLJQ



7KHWUDQVLHQWVWKDWUHTXLUH():KDYHEHHQHYDOXDWHGDVVXPLQJRQO\\RQH0'():3LV

DYDLODEOHWRGHOLYHUWKHQHFHVVDU\\IHHGZDWHU([FHSWDVQRWHGLQWKHVXEVHFWLRQVWKDW

IROORZ6HFWLRQ><<@



7KHOLFHQVHHSURSRVHGWRUHYLVH6HFWLRQRIWKH8)6$5E\\GHOHWLQJFXUUHQW

6HFWLRQVDQGDQGDGGLQJWKHIROORZLQJ





():5HVSRQVH)ROORZLQJD+(/%



&HUWDLQ+(/%VLQFRQMXQFWLRQZLWKSRVWXODWHGVLQJOHIDLOXUHFDQGLVDEOHDOO

VRXUFHVRIHPHUJHQF\\IHHGZDWHU7KHVH+(/%VDUHHYDOXDWHGLQDSSOLFDEOH

DQDO\\VHVDVDGGUHVVHGLQ8)6$56HFWLRQ)RUWKHVHFDVHVLQZKLFK

():LVQRWDYDLODEOH 7'():30'():3FURVVFRQQHFWV WKH36:V\\VWHP

DQGWKH66)$6:V\\VWHPSURYLGHDQDGGLWLRQDOVRXUFHRIVHFRQGDU\\FRROLQJ

ZDWHU





5HJXODWRU\\5HTXLUHPHQWVDQG*XLGDQFH'RFXPHQWV



7KH15&VWDIIFRQVLGHUHGWKHIROORZLQJUHJXODWRU\\UHTXLUHPHQWVOLFHQVLQJDQGGHVLJQEDVLV

LQIRUPDWLRQDQGJXLGDQFHGXULQJLWVUHYLHZRIWKHSURSRVHGFKDQJHV



7KH15&VWDIILGHQWLILHGWKHIROORZLQJ2FRQHH8)6$53ODQW'HVLJQ&ULWHULDDVEHLQJDSSOLFDEOH

WRWKHSURSRVHGDPHQGPHQWV



8)6$56HFWLRQ³&ULWHULRQ5HDFWRU&RUH'HVLJQ &DWHJRU\\$ 'VWDWHVLQSDUW



7KHUHDFWRUFRUHVKDOOEHGHVLJQHGWRIXQFWLRQWKURXJKRXWLWVGHVLJQOLIHWLPH

ZLWKRXWH[FHHGLQJDFFHSWDEOHIXHOGDPDJHOLPLWVZKLFKKDYHEHHQVWLSXODWHG

DQGMXVWLILHG7KHFRUHGHVLJQWRJHWKHUZLWKUHOLDEOHSURFHVVDQGGHFD\\KHDW

UHPRYDOV\\VWHPVVKDOOSURYLGHIRUWKLVFDSDELOLW\\XQGHUDOOH[SHFWHGFRQGLWLRQV

RIQRUPDORSHUDWLRQZLWKDSSURSULDWHPDUJLQVIRUXQFHUWDLQWLHVDQGIRUWUDQVLHQW

VLWXDWLRQVZKLFKFDQEHDQWLFLSDWHGLQFOXGLQJWKHHIIHFWVRIWKHORVVRISRZHUWR

UHFLUFXODWLRQSXPSVWULSSLQJRXWRIDWXUELQHJHQHUDWRUVHWLVRODWLRQRIWKH

UHDFWRUIURPLWVSULPDU\\KHDWVLQNDQGORVVRIDOORIIVLWHSRZHU



8)6$56HFWLRQ³&ULWHULRQ5HDFWRU&RRODQW3UHVVXUH%RXQGDU\\ &DWHJRU\\$ 'VWDWHV

LQSDUW



7KHUHDFWRUFRRODQWSUHVVXUHERXQGDU\\VKDOOEHGHVLJQHGDQGFRQVWUXFWHGVRDV

WRKDYHDQH[FHHGLQJO\\ORZSUREDELOLW\\RIJURVVUXSWXUHRUVLJQLILFDQWOHDNDJH

WKURXJKRXWLWVGHVLJQOLIHWLPH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











8)6$56HFWLRQ³&ULWHULRQ3URWHFWLRQ6\\VWHPV5HGXQGDQF\\DQG,QGHSHQGHQFH

&DWHJRU\\% 'VWDWHVLQSDUW



5HGXQGDQF\\DQGLQGHSHQGHQFHGHVLJQHGLQWR3URWHFWLYH6\\VWHPVVKDOOEH

VXIILFLHQWWRDVVXUHWKDWQRVLQJOHIDLOXUHRUUHPRYDOIURPVHUYLFHRIDQ\\

FRPSRQHQWRUFKDQQHORIDV\\VWHPZLOOUHVXOWLQORVVRIWKHSURWHFWLYHIXQFWLRQ

7KHUHGXQGDQF\\SURYLGHGVKDOOLQFOXGHDVDPLQLPXPWZRFKDQQHOVRI

SURWHFWLRQIRUHDFKSURWHFWLYHIXQFWLRQWREHVHUYHG'LIIHUHQWSULQFLSOHVVKDOOEH

XVHGZKHUHQHFHVVDU\\WRDFKLHYHWUXHLQGHSHQGHQFHRIUHGXQGDQW

LQVWUXPHQWDWLRQFRPSRQHQWV



8)6$56HFWLRQ³&ULWHULRQ3URWHFWLRQDJDLQVW0XOWLSOH'LVDELOLW\\IRU3URWHFWLRQ

6\\VWHPV &DWHJRU\\% 'VWDWHVLQSDUW



7KHHIIHFWVRIDGYHUVHFRQGLWLRQVWRZKLFKUHGXQGDQWFKDQQHOVRU3URWHFWLYH

6\\VWHPVPLJKWEHH[SRVHGLQFRPPRQHLWKHUXQGHUQRUPDOFRQGLWLRQVRUWKRVH

RIDQDFFLGHQWVKDOOQRWUHVXOWLQDORVVRIWKHSURWHFWLYHIXQFWLRQ



8)6$56HFWLRQ³&ULWHULRQ(PHUJHQF\\3RZHUIRU3URWHFWLRQ6\\VWHPV &DWHJRU\\% '

VWDWHVLQSDUW



,QWKHHYHQWRIORVVRIDOORIIVLWHSRZHUVXIILFLHQWDOWHUQDWHVRXUFHVRISRZHUVKDOO

EHSURYLGHGWRSHUPLWWKHUHTXLUHGIXQFWLRQLQJRIWKH3URWHFWLYH6\\VWHPV



8)6$56HFWLRQ³&ULWHULRQ(QJLQHHUHG6DIHW\\)HDWXUHV%DVLVIRU'HVLJQ

&DWHJRU\\$ 'VWDWHVLQSDUW



(QJLQHHUHGVDIHW\\IHDWXUHVVKDOOEHSURYLGHGLQWKHIDFLOLW\\WREDFNXSWKHVDIHW\\

SURYLGHGE\\WKHFRUHGHVLJQWKHUHDFWRUFRRODQWSUHVVXUHERXQGDU\\DQGWKHLU

SURWHFWLRQV\\VWHPV$VDPLQLPXPVXFKHQJLQHHUHGVDIHW\\IHDWXUHVVKDOOEH

GHVLJQHGWRFRSHZLWKDQ\\VL]HUHDFWRUFRRODQWSUHVVXUHERXQGDU\\EUHDNXSWR

DQGLQFOXGLQJWKHFLUFXPIHUHQWLDOUXSWXUHRIDQ\\SLSHLQWKDWERXQGDU\\DVVXPLQJ

XQREVWUXFWHGGLVFKDUJHIURPERWKHQGV



8)6$56HFWLRQ³&ULWHULRQ(PHUJHQF\\3RZHUIRU(QJLQHHUHG6DIHW\\)HDWXUHV

&DWHJRU\\$ 'VWDWHVLQSDUW



$OWHUQDWHSRZHUV\\VWHPVVKDOOEHSURYLGHGDQGGHVLJQHGZLWKDGHTXDWH

LQGHSHQGHQF\\UHGXQGDQF\\FDSDFLW\\DQGWHVWDELOLW\\WRSHUPLWWKHIXQFWLRQLQJ

UHTXLUHGRIWKHHQJLQHHUHGVDIHW\\IHDWXUHV$VDPLQLPXPWKHRQVLWHSRZHU

V\\VWHPDQGWKHRIIVLWHSRZHUV\\VWHPVKDOOHDFKLQGHSHQGHQWO\\SURYLGHWKLV

FDSDFLW\\DVVXPLQJDIDLOXUHRIDVLQJOHDFWLYHFRPSRQHQWLQHDFKSRZHUV\\VWHP



8)6$56HFWLRQ³&ULWHULRQ0LVVLOH3URWHFWLRQ &DWHJRU\\$ 'VWDWHVLQSDUW



3URWHFWLRQIRUHQJLQHHUHGVDIHW\\IHDWXUHVVKDOOEHSURYLGHGDJDLQVWG\\QDPLF

HIIHFWVDQGPLVVLOHVWKDWPLJKWUHVXOWIURPSODQWHTXLSPHQWIDLOXUHV



5HJXODWLRQVLQ&)5³(QYLURQPHQWDOTXDOLILFDWLRQRIHOHFWULFHTXLSPHQWLPSRUWDQWWR

VDIHW\\IRUQXFOHDUSRZHUSODQWV'UHTXLUHOLFHQVHHVWRHVWDEOLVKDSURJUDPIRUTXDOLI\\LQJHOHFWULF

HTXLSPHQWDVGHILQHGLQ&)5 E 

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











5HJXODWLRQVLQ&)5 H  ³7HPSHUDWXUHDQGSUHVVXUH'UHTXLUHWKDWWKHWLPH

GHSHQGHQWWHPSHUDWXUHDQGSUHVVXUHDWWKHORFDWLRQRIWKHHOHFWULFHTXLSPHQWLPSRUWDQWWR

VDIHW\\PXVWEHHVWDEOLVKHGIRUWKHPRVWVHYHUHGHVLJQEDVLVDFFLGHQWGXULQJRUIROORZLQJZKLFK

WKLVHTXLSPHQWLVUHTXLUHGWRUHPDLQIXQFWLRQDO



185(*³6WDQGDUG5HYLHZ3ODQIRUWKH5HYLHZRI6DIHW\\$QDO\\VLV5HSRUWVIRU1XFOHDU

3RZHU3ODQWV/:5>/LJKW:DWHU5HDFWRU@(GLWLRQ' 653 6HFWLRQ³3ODQW'HVLJQIRU

3URWHFWLRQ$JDLQVW3RVWXODWHG3LSLQJ)DLOXUHVLQ)OXLG6\\VWHPV2XWVLGH&RQWDLQPHQW'5HYLVLRQ

 5HIHUHQFH 



185(*6HFWLRQ³(QYLURQPHQWDO4XDOLILFDWLRQRI0HFKDQLFDODQG(OHFWULFDO

(TXLSPHQW'5HYLVLRQ 5HIHUHQFH SURYLGHVJXLGDQFHRQHQYLURQPHQWDOTXDOLILFDWLRQ (4 

RIPHFKDQLFDODQGHOHFWULFDOHTXLSPHQW



185(*&KDSWHU³(OHFWULF3RZHU' 5HIHUHQFH SURYLGHVJXLGDQFHRQHOHFWULFDO

SRZHUV\\VWHPV



185(*&KDSWHU³+XPDQ)DFWRUV(QJLQHHULQJ'5HYLVLRQ 5HIHUHQFH GLVFXVVHV

WKHSURFHVVHVIRUHYDOXDWLQJRSHUDWRUDFWLRQVDQGLGHQWLILHVVSHFLILFDUHDVRIUHYLHZWKDWDUH

QHHGHGIRUVXFFHVVIXOLQWHJUDWLRQRIKXPDQFKDUDFWHULVWLFVDQGFDSDELOLWLHVLQWRQXFOHDUSRZHU

SODQWGHVLJQ



185(*6HFWLRQ³5HDFWRU2SHUDWRU5HTXDOLILFDWLRQ3URJUDP5HDFWRU2SHUDWRU

7UDLQLQJ'5HYLVLRQ 5HIHUHQFH 6HFWLRQ³1RQ/LFHQVHG3ODQW6WDII7UDLQLQJ'

5HYLVLRQ 5HIHUHQFH DQG6HFWLRQ³2SHUDWLQJDQG(PHUJHQF\\2SHUDWLQJ

3URFHGXUHV'5HYLVLRQ 5HIHUHQFH 



185(*³+XPDQ)DFWRUV(QJLQHHULQJ3URJUDP5HYLHZ0RGHO'5HYLVLRQ 5HIHUHQFH

 SURYLGHVDFFHSWDQFHFULWHULDIRUDKXPDQIDFWRUHQJLQHHULQJGHVLJQSURFHVV



185(*³*XLGDQFHIRUWKH5HYLHZRI&KDQJHVWR+XPDQ$FWLRQV'5HYLVLRQ 5HIHUHQFH

 SURYLGHVJXLGDQFHRQWKHOHYHORIUHYLHZIRUKXPDQDFWLRQV



185(*%UDQFK7HFKQLFDO3RVLWLRQ³3URWHFWLRQ$JDLQVW3RVWXODWHG3LSLQJ)DLOXUHVLQ

)OXLG6\\VWHPV2XWVLGH&RQWDLQPHQW'5HYLVLRQ 5HIHUHQFH 



7HFKQLFDO6SHFLILFDWLRQ³3URWHFWHG6HUYLFH:DWHU 36: 6\\VWHP'UHTXLUHVWKDWWKH36:

V\\VWHPEHRSHUDEOHLQRSHUDWLRQDOPRGHVDQG



7HFKQLFDO6SHFLILFDWLRQ³6WDQGE\\6KXWGRZQ)DFLOLW\\ 66) 'UHTXLUHVWKDWWKH66)EH

RSHUDEOHLQRSHUDWLRQDOPRGHVDQG



  • HQHULF/HWWHU */ ³5HOD[DWLRQLQ$UELWUDU\\,QWHUPHGLDWH3LSH5XSWXUH5HTXLUHPHQWV'

5HYRI%730(% GDWHG-XQH 5HIHUHQFH 



/HWWHUIURP$*LDPEXVVR $(& WR$&7KLHV 'XNH3RZHU&RPSDQ\\ ³*HQHUDO,QIRUPDWLRQ

5HTXLUHGIRU&RQVLGHUDWLRQRIWKH(IIHFWVRID3LSLQJ6\\VWHP%UHDN2XWVLGH&RQWDLQPHQW'

5HIHUHQFH GDWHG'HFHPEHU

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











&ODULILFDWLRQ/HWWHUIURP$6FKZHQFHU $(& WR$&7KLHV 'XNH3RZHU&RPSDQ\\ ³(UUDWDWR

  • HQHUDO,QIRUPDWLRQ5HTXLUHGIRU&RQVLGHUDWLRQRIWKH(IIHFWVRID3LSLQJ6\\VWHP%UHDN2XWVLGH

&RQWDLQPHQW' 5HIHUHQFH GDWHG-DQXDU\\



7KH*LDPEXVVR6FKZHQFHUOHWWHUVSURYLGHGDOLVWRIUHTXHVWHGLQIRUPDWLRQWKDWZRXOG

GHPRQVWUDWHZLWKUHDVRQDEOHDVVXUDQFHWKDWWKHSODQWFRXOGEHVDIHO\\VKXWGRZQDQG

PDLQWDLQHGLQDVDIHVKXWGRZQFRQGLWLRQIROORZLQJFUHGLEOHIDLOXUHVRISLSLQJLQKLJKHQHUJ\\

V\\VWHPV7KH15&VWDIIVXPPDUL]HGWKHJXLGDQFHLQWKHVHOHWWHUVDVXSGDWHGE\\*/

ZLWKWKHIROORZLQJWKUHHJHQHUDOVWUDWHJLHVIRUSURWHFWLRQDJDLQVW+(/%V



x

DSRVWXODWHGEUHDNLVRIYHU\\ORZSUREDELOLW\\EDVHGRQWKHRSHUDWLQJFRQGLWLRQVRIWKH

SLSLQJ



x

HVVHQWLDOPLWLJDWLQJV\\VWHPVDUHSK\\VLFDOO\\VHSDUDWHGIURPWKHEUHDNDUHDDQGDQ\\

UHVXOWLQJVWUXFWXUDOGDPDJH



x

HVVHQWLDOPLWLJDWLQJV\\VWHPVDUHGHVLJQHGWRZLWKVWDQGWKHHIIHFWVRIWKHEUHDNZKLFK

PD\\LQFOXGHSLSHZKLSUHVWUDLQWVMHWVKLHOGVDQGHQYLURQPHQWDOTXDOLILFDWLRQRIHOHFWULFDO

FRPSRQHQWV



7KH*LDPEXVVR/HWWHUDVPRGLILHGE\\WKH6FKZHQFHU/HWWHUSURYLGHGWKHIROORZLQJUHYLHZ

,WHPVDVVXPPDUL]HGE\\WKH15&VWDII



,GHQWLILFDWLRQRIV\\VWHPSLSLQJVHJPHQWVQHHGLQJSK\\VLFDOUHVWUDLQWWRSUHYHQWGDPDJHWR

VDIHVKXWGRZQV\\VWHPV



 &ULWHULDIRULGHQWLILFDWLRQRISLSHEUHDNORFDWLRQV



 &ULWHULDWRGHWHUPLQHSLSHEUHDNRULHQWDWLRQ



 6XPPDU\\RIG\\QDPLFDQDO\\VHVRISLSLQJV\\VWHPUHVSRQVHWRUXSWXUHV



 'HVFULSWLRQRIPHDVXUHVWRSURWHFWDJDLQVWSLSHZKLSDQGMHWLPSLQJHPHQW



 'HVLJQFULWHULDWRHYDOXDWHVWUXFWXUDOUHVSRQVH



 'HVLJQORDGDFFHSWDQFHFULWHULDIRUVWUXFWXUDOHOHPHQWV



 (YDOXDWLRQRIVWUXFWXUDOHOHPHQWVH[SHULHQFLQJDUHYHUVDOLQORDGGXHWRSUHVVXUL]DWLRQRI

FRPSDUWPHQWVE\\SLSHEUHDNV



 (YDOXDWLRQRIPRGLILHGVWUXFWXUHVWRZLWKVWDQGSLSHEUHDNORDGV



9HULILFDWLRQWKDWWKHFRQVHTXHQFHVRIVWUXFWXUDOIDLOXUHVZRXOGQRWSUHYHQWVDIH

VKXWGRZQ



9HULILFDWLRQWKDWWKHFRQVHTXHQFHVRISLSHEUHDNVZRXOGQRWFDXVHDORVVRIQHFHVVDU\\

SURWHFWLYHV\\VWHPUHGXQGDQF\\IRUGLUHFWHIIHFWVRUORVVRIIXQFWLRQIRULQGLUHFWHIIHFWV



$VVXUDQFHRIKDELWDELOLW\\IRUQHFHVVDU\\FRQWUROFDSDELOLW\\WRDFKLHYHVDIHVKXWGRZQ

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











(QYLURQPHQWDOTXDOLILFDWLRQRIHTXLSPHQWWKDWPXVWIXQFWLRQDIWHUH[SRVXUHWRWKHLQGLUHFW

HIIHFWVRIKLJKHQHUJ\\SLSHEUHDNV



'UDZLQJVRI06DQG)':OLQHVVKRZLQJURXWLQJ



$VVHVVPHQWRIIORRGLQJSRWHQWLDOIROORZLQJ+(/%



'HVFULSWLRQRITXDOLW\\FRQWURODQGLQVSHFWLRQPHDVXUHVDSSOLHGWRSLSLQJV\\VWHPV



'HVFULSWLRQRIWKHFDSDELOLWLHVRIQHFHVVDU\\OHDNGHWHFWLRQHTXLSPHQW



6XPPDU\\RIHPHUJHQF\\SURFHGXUHV



'HVFULSWLRQRIVHLVPLFDQGTXDOLW\\FODVVLILFDWLRQRISLSLQJV\\VWHPV



'HVFULSWLRQRIDVVXPSWLRQVPHWKRGVRIDQDO\\VLVDQGDQDO\\VLVUHVXOWVIRUSUHVVXUHDQG

WHPSHUDWXUHWUDQVLHQWVLQFRPSDUWPHQWV



'HVFULSWLRQRIWKHPHWKRGXVHGWRGHPRQVWUDWHQRDGYHUVHHIIHFWVRQSULPDU\\

FRQWDLQPHQWIURPEUHDNVRXWVLGHFRQWDLQPHQW





7(&+1,&$/(9$/8$7,21





5HYLVHG+(/%6WUDWHJ\\



7KH15&VWDII¶VUHYLHZRISODQWGHVLJQIRUSURWHFWLRQDJDLQVW+(SLSLQJIDLOXUHVRXWVLGH

FRQWDLQPHQWLVWRHQVXUHWKDWHQYLURQPHQWDOHIIHFWVRIVXFKIDLOXUHVZRXOGQRWFDXVHWKHORVVRI

QHHGHGIXQFWLRQVWRHQVXUHWKDWWKHSODQWFRXOGEHVDIHO\\VKXWGRZQLQWKHHYHQWRIVXFK

IDLOXUHV7KH15&VWDIIUHYLHZHGWKH+(/%PHWKRGRORJ\\WRHQVXUHWKDWWKHFULWHULDZHUH

LPSOHPHQWHGSURSHUO\\



$VQRWHGLQWKH/$5WKH2FRQHHRULJLQDOOLFHQVLQJEDVLVIRU+(/%ZDVFRQWDLQHGZLWKLQWKH

UHVSRQVHVWRWKH*LDPEXVVR6FKZHQFHUOHWWHUV$VVHWRXWLQWKHOHWWHUVDQXFOHDUSODQWVKRXOG

EHGHVLJQHGVRWKDWWKHUHDFWRUFDQEHVKXWGRZQDQGPDLQWDLQHGLQDQ66'FRQGLWLRQLQWKH

HYHQWRIDSRVWXODWHGUXSWXUHRXWVLGHFRQWDLQPHQWRIDSLSHFRQWDLQLQJD+(IOXLGLQFOXGLQJWKH

GRXEOHHQGHGUXSWXUHRIWKHODUJHVWSLSHLQWKH06DQG)':V\\VWHPV3ODQW66&VLPSRUWDQWWR

VDIHW\\VKRXOGEHGHVLJQHGDQGORFDWHGLQWKHIDFLOLW\\WRDFFRPPRGDWHWKHHIIHFWVRIVXFKD

SRVWXODWHGSLSHIDLOXUHWRWKHH[WHQWQHFHVVDU\\WRHQVXUHWKDWDQ66'FRQGLWLRQRIWKHUHDFWRU

FDQEHDFFRPSOLVKHGDQGPDLQWDLQHG



7KHRYHUDOOSURSRVHG+(/%PLWLJDWLRQVWUDWHJ\\SURSRVHGE\\WKHOLFHQVHHJHQHUDOO\\UHOLHVRQ

V\\VWHPVDQGHTXLSPHQWFDSDEOHRIEULQJLQJWKHSODQWWRDQ66'FRQGLWLRQWKDWDUHORFDWHG

UHPRWHO\\IURPWKHSRVWXODWHGEUHDNRUFUDFNORFDWLRQ V RUFDQEHVKRZQWRQRWEHGDPDJHGE\\

WKHHIIHFWVRIWKHSRVWXODWHGEUHDN7KHOLFHQVHHLGHQWLILHGWKHIROORZLQJDFWLRQVDVD

PHWKRGRORJ\\WRHYDOXDWHSRWHQWLDO+(/%VRXWVLGHFRQWDLQPHQW



,GHQWLILFDWLRQRIWKH+(V\\VWHPVWKH+(OLQHVDQGWKHERXQGDULHVRIWKH+(OLQHVRQ

HDFKRIWKRVHV\\VWHPV



,GHQWLILFDWLRQRIWKHSRVWXODWHG+(/%ORFDWLRQVDQGEUHDNW\\SHVRQHDFKRIWKH+(OLQHV

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











 'HWHUPLQDWLRQRIWKHHTXLSPHQWDQGV\\VWHPVLQWKH216XQLWVZKLFKFRXOGEHXWLOL]HGWR

PLWLJDWHWKHSRVWXODWHG+(/%V



,GHQWLILFDWLRQRIWKHWDUJHWV 66&V RIHDFKSRVWXODWHG+(/%EDVHGXSRQWKHUHVXOWVRI

ILHOGLQVSHFWLRQV



 'HWHUPLQDWLRQRIWKHVKXWGRZQHTXLSPHQWWKDWLVXQGDPDJHGE\\WKHSRVWXODWHG+(/%

DQGFDQEHXVHGIRUWKH+(/%PLWLJDWLRQDQGWKHVKXWGRZQRIWKHVWDWLRQ7KLVVWHSLV

EDVHGXSRQWKHLGHQWLILFDWLRQRIWKHWDUJHWVDQGWKHLPSDFWRIWKHSRVWXODWHG+(/%VRQ

WKRVHWDUJHWV



,GHQWLILFDWLRQDQGUHFRPPHQGDWLRQRIVWDWLRQSK\\VLFDODQGRUSURFHGXUDOFKDQJHVWR

VXSSRUWWKH+(/%PLWLJDWLRQVWUDWHJ\\





,GHQWLILFDWLRQRI+LJK(QHUJ\\6\\VWHPV



7KHOLFHQVHHKDVVSHFLILHGFULWHULDZKHUHHYDOXDWLRQRIEUHDNHIIHFWVZRXOGQRWEHUHTXLUHGGXH

WRORZFRQWDLQHGHQHUJ\\7KHVHFULWHULDDUHUHODWHGWRV\\VWHPRSHUDWLQJSDUDPHWHUV&RQVLVWHQW

ZLWK,WHPRIWKH*LDPEXVVROHWWHUWKHOLFHQVHHGHILQHGWKH+( SLSLQJ OLQHVDVWKRVHOLQHVWKDW

WKHIOXLGLQVLGHRIWKHSLSHPHHWVHLWKHURUERWKRIWKHIROORZLQJFRQGLWLRQVGXULQJQRUPDO

RSHUDWLRQ



 $QRUPDORSHUDWLQJWHPSHUDWXUHJUHDWHUWKDQ)



 $QRUPDORSHUDWLQJSUHVVXUHJUHDWHUWKDQSVLJ



3LSLQJVHJPHQWVPHHWLQJWKHVH+(/%FULWHULDZHUHDQDO\\]HGZLWKLQWKH/$5WRHQVXUHWKDW

+(/%VZLOOQRWLPSDFWWKHDELOLW\\WREULQJWKHUHDFWRUWRDVKXWGRZQFRQGLWLRQ7KHOLFHQVHH

H[FOXGHGJDV HJQLWURJHQ DQGRLO HJHOHFWURK\\GUDXOLFFRQWURORLO V\\VWHPVIURP

FODVVLILFDWLRQDV+(EHFDXVHWKH\\FRQWDLQPXFKOHVVLQWHUQDOHQHUJ\\WKDQZDWHUV\\VWHPVDW

VLPLODUSUHVVXUHVDQGWHPSHUDWXUHV7KHOLFHQVHHDOVRH[FOXGHGZDWHUDQGVWHDPFRQWDLQLQJ

SLSLQJWKDWQRUPDOO\\RSHUDWHVDWVXEDWPRVSKHULFSUHVVXUH HJVRPHH[WUDFWLRQVWHDPDQG

VHDOLQJVWHDPSLSLQJ GXHWRLQVXIILFLHQWLQWHUQDOHQHUJ\\)LQDOO\\WKHOLFHQVHHH[FOXGHG

SRVWXODWLRQRI+(/%VLQ+(SLSLQJWKDWKDVDQRPLQDOVL]HRILQFKRUOHVVFRQVLVWHQWZLWKWKH

OLFHQVLQJEDVLVHVWDEOLVKHGLQLWVUHVSRQVHWRWKH*LDPEXVVR6FKZHQFHUOHWWHUV



7KHOLFHQVHHH[FOXGHGRWKHU+(V\\VWHPVEHFDXVHWKHV\\VWHPVRSHUDWHRQO\\DVPDOOIUDFWLRQRI

WLPHDW+(FRQGLWLRQV7KHOLFHQVHHGHILQHGDVPDOOIUDFWLRQRIWLPHDVRSHUDWLQJDW+(

FRQGLWLRQVOHVVWKDQSHUFHQWRIWKHWRWDOXQLWRSHUDWLQJWLPH HJ():DQG5%VSUD\\ RU

RSHUDWLQJDW+(FRQGLWLRQVOHVVWKDQDSSUR[LPDWHO\\SHUFHQWRIWKHWRWDOV\\VWHPRSHUDWLQJWLPH

HJORZSUHVVXUHLQMHFWLRQ /3, GXULQJWKHLQLWLDWLRQRIVKXWGRZQFRROLQJZLWKWKHSODQWLQ+RW

6KXWGRZQ 7KHOLFHQVHHSRVWXODWHGQREUHDNVRUFUDFNVIRUV\\VWHPVPHHWLQJWKHVHOLPLWDWLRQV



7KHOLFHQVHHSURSRVHGWKDWWKHIROORZLQJV\\VWHPV DQGSRUWLRQVRIV\\VWHPV EHH[FOXGHGIURP

+(/%SRVWXODWLRQEDVHGRQDQHYDOXDWLRQRIDFWXDORSHUDWLQJWLPHDW+(FRQGLWLRQV



x

():SXPSGLVFKDUJHSLSLQJ

x

5%6SUD\\GLVFKDUJHSLSLQJ

x

µ&¶ VZLQJ +3,SXPSGLVFKDUJHSLSLQJ

x

66)$6:SXPSGLVFKDUJHSLSLQJ

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











x

/3,V\\VWHP HQWLUHV\\VWHP 

x

&RQGHQVDWHUHFLUFXODWLRQSLSLQJWRWKH867

x

0)':SXPSUHFLUFXODWLRQSLSLQJWRWKHPDLQFRQGHQVHU

x

0)':FOHDQXSSLSLQJWRWKH867

x

0)':WRWKH6*DX[LOLDU\\)':QR))OHV

x

6*KRWEORZGRZQGUDLQSLSLQJ

x

7XUELQHE\\SDVVYDOYHGLVFKDUJHSLSLQJWRWKHPDLQFRQGHQVHU



8VLQJWKH+(OLQHFULWHULDDQGFRQVLGHULQJWKHH[FOXVLRQVGHVFULEHGDERYHWKHOLFHQVHH

LGHQWLILHGWKHIROORZLQJV\\VWHPVDVV\\VWHPVFRQWDLQLQJ+(SLSLQJVXEMHFWWRSRVWXODWHG

+(/%VLQHDFKXQLW



x

$X[LOLDU\\6WHDP

x

&RQGHQVDWH

x

([WUDFWLRQ6WHDP

x

0)':

x

06

x

+HDWHU'UDLQ

x

+HDWHU9HQW

x

+3,

x

0RLVWXUH6HSDUDWRU5HKHDWHU'UDLQ

x

3ODQW+HDWLQJ 3+ 

x

5HYHUVH2VPRVLV

x

6WHDP'UDLQ

x

6WHDP6HDO+HDGHU



7KHDERYH+(V\\VWHPVDQGDVVRFLDWHGSLSLQJDUHLQWKH7%DQG$%RIHDFKXQLW$OOWKH+(

V\\VWHPVH[FHSWIRUWKH+3,V\\VWHPDUHLQWKH7%VDQGRQO\\WKH060)':+3,DQG3+

V\\VWHPVDUHORFDWHGLQWKH$%V$VHJPHQWRI06SLSLQJIURPHDFKXQLWLVLQWKH\\DUGDUHD

RXWVLGHVWUXFWXUHV



15&6WDII(YDOXDWLRQ



7KH15&VWDIIHYDOXDWHGWKHOLFHQVHH¶VLGHQWLILFDWLRQRI+(SLSLQJVHJPHQWV7KH15&VWDII

ILQGVWKDWWKHOLVWRI+(V\\VWHPVLVFRQVLVWHQWZLWKWKHV\\VWHPVOLVWHGLQ7DEOHRI653

6HFWLRQZLWKFRQVLGHUDWLRQRIWKHLGHQWLILHGH[FOXVLRQV7KH15&VWDIIKDVSUHYLRXVO\\

LGHQWLILHGWKDWSLSLQJV\\VWHPVRSHUDWHGRQO\\IRUVKRUWSHULRGVRIWKHV\\VWHPRSHUDWLRQDOWLPHDW

+(PD\\EHWUHDWHGDVPRGHUDWHHQHUJ\\V\\VWHPVLQ6HFWLRQ%RI%73³3RVWXODWHG5XSWXUH

/RFDWLRQVLQ)OXLG6\\VWHP3LSLQJ,QVLGHDQG2XWVLGH&RQWDLQPHQW' 5HIHUHQFH )RU

2FRQHHSRVWXODWHGOHDNDJHFUDFNVRUUXSWXUHVRIPRGHUDWHHQHUJ\\SLSLQJLVQRWZLWKLQWKH

IDFLOLW\\OLFHQVLQJEDVLV7KHORZHUOLNHOLKRRGRIUXSWXUHLQV\\VWHPVWKDWRSHUDWHRQO\\DVKRUW

SHULRGRIWLPHDW+(FRQGLWLRQVLVFRQVLVWHQWZLWKWKHVORZHUGHYHORSPHQWRISLSHGHJUDGDWLRQDW

ORZHQHUJ\\FRQGLWLRQVDQGWKHUHGXFHGOLNHOLKRRGWKDWSLSHVWUHVVZRXOGH[FHHGUHPDLQLQJSLSH

VWUHQJWKEHFDXVHVWUHVVHVDUHKLJKHVWGXULQJWKHVKRUWSHULRGRIRSHUDWLRQDW+(FRQGLWLRQV

7KXVWKH15&VWDIIGHWHUPLQHGWKDWWKHH[FOXVLRQVUHIOHFWSUHYLRXVO\\DFFHSWHG15&VWDII

SRVLWLRQV



7KH15&VWDIIILQGVWKDWWKHH[FOXVLRQVKDYHDVXEVWDQWLDOO\\ORZHUVDIHW\\VLJQLILFDQFHRISLSLQJ

UXSWXUHVLQV\\VWHPVWKDWDUHDW+(FRQGLWLRQVEHFDXVH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











x

WKHVPDOOIUDFWLRQRIWKHSODQWRSHUDWLQJWLPHRU

x

WKH\\FRQWDLQOLWWOHLQWHUQDOHQHUJ\\EDVHGRQRSHUDWLQJIOXLGRSHUDWLQJFRQGLWLRQVRUSLSH

VL]H



%DVHGRQWKHDERYHWKH15&VWDIIILQGVWKDWWKHOLVWRIV\\VWHPVLGHQWLILHGDV+(LVDFFHSWDEOH

DQGFRQVLVWHQWZLWK*LDPEXVVR6FKZHQFHU,WHP





,GHQWLILFDWLRQRI+(/%,QWHUDFWLRQ=RQHVDQG/RFDWLRQV



7KHOLFHQVHHSURSRVHGUHYLVHGPHWKRGVRILGHQWLI\\LQJSRVWXODWHG+(/%ORFDWLRQVXVLQJSLSLQJ

VWUHVVDQGORFDWLRQFULWHULD7KHLQWHUDFWLRQVGXHWRD+(/%HYHQWZHUHPDGHXSRIVWUXFWXUDO

HIIHFWV DQGHQYLURQPHQWDOHIIHFWV WKHPHFKDQLVPRIUXSWXUHDQGWKHSK\\VLFDODUUDQJHPHQWRI

DGMDFHQWVWUXFWXUHVZKLFKDOOFRQWULEXWHWRWKHSLSLQJUHDFWLRQV7KHOLFHQVHHXVHGWKHVH

DWWULEXWHVIRUHDFKEUHDNORFDWLRQWRDVVHVVWKHSRWHQWLDO+(/%LQWHUDFWLRQV



7KHOLFHQVHHLGHQWLILHGDWWULEXWHVRIWKH+(/%SLSLQJUHDFWLRQVLQSK\\VLFDOUHJLRQVZLWK

VLJQLILFDQWLQWHUDFWLRQVRQRWKHU66&V7KHUHJLRQRILPSDFWLVWKH]RQHVRILQIOXHQFH =RO 

DIIHFWHGE\\WKH+(/%HYHQW7KHJHRPHWU\\RIHDFK=R,ZDVGHWHUPLQHGZLWKRXWFRQVLGHULQJDQ\\

DOWHUDWLRQFDXVHGE\\µWDUJHWV¶ORFDWHGZLWKLQWKH]RQH2QFHGHWHUPLQHGLQVKDSHWKH=R,ZDV

PRGLILHGE\\LGHQWLILHGREVWUXFWLQJVWUXFWXUHVDQGREVWUXFWLRQV7KH15&VWDIIUHYLHZHGWKH

RULHQWDWLRQRIWKH=R,DVGHVFULEHGEHORZ





&LUFXPIHUHQWLDO%UHDN=RQH



3LSLQJWKDWVHYHUVDWWKHHQGVGLVSODFHD[LDOO\\XQGHUWKHWKHUPRG\\QDPLFIRUFHVGHYHORSHGE\\

WKHGLVFKDUJLQJIOXLG7KHOLFHQVHH¶VFDOFXODWLRQFRQVLGHUHGGHIOHFWLRQVRIWKHSLSLQJHQGV

FDXVHGE\\WKHH[LVWLQJIOXLGHQHUJ\\DWERWKD[LDODQGSHUSHQGLFXODUGLUHFWLRQVGHSHQGLQJRQ

SLSLQJVXSSRUWDUUDQJHPHQWDQGSUR[LPLW\\RIREVWUXFWLQJVWUXFWXUHVDQGWKHFRRUGLQDWHVRI

EUHDNKLQJHV7KHVHYHULW\\RISLSHZKLSGLVSODFHPHQWVVSHFLILFDOO\\LQSHUSHQGLFXODURXWRI

SODQHGLUHFWLRQVZHUHGRPLQDWHGE\\WKHVWUHQJWKDQGWLPHODSVHRIWKHWKHUPRG\\QDPLFIRUFHV

DQGWKHDWWULEXWHVRIWKHSLSLQJV\\VWHPDQGHQYLURQPHQW



&RQVWUDLQVOLPLWWKHUDQJHRU]RQHRILPSDFWRIWKHZKLSSLQJSLSHGXHWRH[LVWLQJSLSLQJ

UHVWUDLQWVRURWKHUVWUXFWXUHV:LWKRXWWKHSUHVHQFHRIVWUXFWXUHVRUUXSWXUHUHVWUDLQWVDGMDFHQW

SLSLQJWRWKHSRVWXODWHGEUHDNGHWHUPLQHVWKHSDWKDQGWKH=RO7KHLQLWLDOEORZGRZQIRUFHVDUH

RIWKHPDJQLWXGHDQGOLPLWHGGXUDWLRQWKDWWKHSLSLQJFDQQRWUHVSRQGHODVWLFDOO\\DQGDORFDOL]HG

LQHODVWLFLW\\ZLWKDSODVWLFKLQJHZRXOGIRUP7KHOLFHQVHHLQGLFDWHGWKDWXVXDOO\\WKHSODVWLFKLQJH

GHYHORSHGHLWKHUDWWKHILUVWHOERZIURPWKHEUHDNRUDWDQLQOLQHSRLQWEHIRUHWKHILUVWHOERZLI

GHWHUPLQHGWREHWKHSULPDU\\KLQJHORFDWLRQ7KHSLSHZKLSSDWKWKHUHIRUHUHPDLQVSULPDULO\\LQ

DVLQJOHSODQHDOLJQHGZLWKWKHD[LVRIWKHLQLWLDOMHWGLVFKDUJHDQGWKHSLSHD[LVDWWKHKLQJH

ORFDWLRQ7KHRYHUDOO=ROZKLFKLQFOXGHVWKHGLVFKDUJLQJIOXLGMHWPD\\H[WHQGWKHZKLS=RO

IDUWKHUGHSHQGLQJRQWKHRULHQWDWLRQRIWKHEUHDNSODQHUHODWLYHWRWKHKLQJHSRVLWLRQ7KH15&

VWDIIDJUHHVWKDWWKHSODVWLFKLQJHGHYHORSHGDWWKHHOERZRUDSRLQWEHIRUHDQGWKHD[LVRIWKH

MHWIRUPVWKHSODQHIRUWKH=R,7KLVLVGXHWRWKHPHFKDQLVWLFGHJUHHRIIUHHGRPIRUURWDWLRQLQ

WKHSODQH%DVHGRQWKHDERYHWKH15&VWDIIILQGVLWDFFHSWDEOHWRGHWHUPLQHWKHVH=R,¶VSULRU

WRGHWHUPLQLQJWKHLQWHUDFWLRQVZLWKREVWDFOHVEHFDXVHWKHERXQGDULHVRILQWHUDFWLRQZLOOEHZHOO

GHILQHG

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21













/RQJLWXGLQDO%UHDN=RQH



7KHOLFHQVHHLQGLFDWHGWKDWSLSHZKLSGXHWRORQJLWXGLQDOEUHDNVRFFXUVDVDUHDFWLRQIURPWKH

IOXLGMHWGLVFKDUJLQJLQWKHRSSRVLWHGLUHFWLRQ7KHSKHQRPHQRQRIWKHIOXLGMHWIRUFHVLVDOPRVW

LGHQWLFDOWRWKRVHIRUFLUFXPIHUHQWLDOEUHDNV7KHVHYHULW\\RIWKHSLSHZKLSLVOLPLWHGWRD

VZHHSLQJSODQHVLQFHWKHSLSHGRHVQRWVHYHU3LSHZKLSGLVSODFHPHQWVDUHWKRVHFDXVLQJ

RXWRISODQHGHIOHFWLRQV:LWKDFKDQJHLQGLUHFWLRQWKDWLVGHIOHFWHGRXWRISODQHWKH=ROVKDSH

WDNHVRQDGLPHQVLRQDOµVZHHS

DUF7KHLQWHUDFWLRQ]RQHLVFORVHWRWKHUXSWXUHGHOERZDQG

WKHERXQGDULHVDWWKHWZRSLSHKLQJHV7KH=ROZRXOGSURGXFHDGLPHQVLRQDOVKDSHRID

SDUWLDOHOOLSWLFDOFLUFXODUZLWKWKHVHJPHQWDUHDEHWZHHQWKHLQLWLDODQGGHIOHFWHGSLSHD[HVEHLQJ

WKHLPSDFW]RQH7KLVLVGXHWRWKHPHFKDQLVWLFGHJUHHRIIUHHGRPIRUURWDWLRQLQWKHSODQH

ZKLFKZRXOGSURGXFHDGLPHQVLRQDOVKDSHRIDSDUWLDOHOOLSWLFDOFLUFXODUZLWKWKHVHJPHQWDUHD

EHWZHHQWKHLQLWLDODQGGHIOHFWHGSLSHD[HVEHLQJWKHLPSDFW]RQH7KH15&VWDIIDJUHHVWKDW

WKLVLVDOPRVWLGHQWLFDOWRWKDWRIDFLUFXPIHUHQWLDOEUHDNDQGWKHUHIRUHFRQFOXGHVLWLVDOVR

DFFHSWDEOH





&ULWLFDO&UDFN=RQH



7KHOLFHQVHHVWDWHGWKDW+(/%FUDFNVDUHQRWVXEMHFWHGWRSLSHZKLSVLQFHWKHIOXLGIRUFHVDUH

JUHDWO\\OLPLWHGE\\WKHUHGXFHGGLVFKDUJHIORZDUHDDQGDUHWKHUHIRUHRILQVXIILFLHQWPDJQLWXGH

WRDSSUHFLDEO\\GLVSODFHWKHSLSLQJZKLFKUHPDLQVIXOO\\LQWDFW7KH15&VWDIIDJUHHVWKDWWKHIORZ

WKURXJKDFULWLFDOFUDFNLVLQVXIILFLHQWWRFDXVHSLSHZKLSEHFDXVHRIWKHJUHDWO\\UHGXFHGIOXLG

HQHUJ\\DVVRFLDWHGZLWKWKHOLPLWHGGLVFKDUJHIORZDUHDDQGWKXVWKHUHGXFHGLPSDFWRIWKHMHW

FRPSDUHGWRWKRVHIURPIXOOVL]HGEUHDNV7KH15&VWDIIILQGVWKLVDSSURDFKDFFHSWDEOH

EHFDXVHVLJQLILFDQWLPSDFWIURPFULWLFDOFUDFNMHWVRQUHODWLYHO\\UXJJHGVWUXFWXUHVVXFKDV

VWUXFWXUDOVWHHODQGSUHVVXUHERXQGDU\\SLSLQJLVQRWFUHGLEOH





-HW,PSLQJHPHQW,QWHUDFWLRQ=RQHV



7KHMHWLPSLQJHPHQW=ROLVEDVHGRQWKHMHWOHQJWKDQGZLGWK GLDPHWHU FRUUHVSRQGLQJWRWKH

SRLQWZKHUHWKHMHWSUHVVXUHDWLPSDFWKDVGHFUHDVHGWRDWKUHVKROGYDOXH7KHVH

FXWRII

YDOXHV

RILPSLQJHPHQWSUHVVXUHDUHGHULYHGIURPWKHILJXUHVLQ185(*&5³7ZR3KDVH-HW

/RDGV' 5HIHUHQFH 





6KDSHRI)OXLG-HWV



7KHVKDSHRIWKHIOXLGMHWLVQHDUO\\DFLUFXODUFRQHZLWKHGJHVH[SDQGLQJRXWZDUGIURPWKHEUHDN

SODQH7KHVKDSHRIWKHMHWUHJLRQRXWERDUGRIWKHLQLWLDOMHWFRUHLVPRVWDSSUR[LPDWLQJDQGIRU

VDWXUDWHGIOXLGVUHDVRQDEO\\FRUUHVSRQGVWRDVXEFRROHGIOXLGMHWIRUKLJKO\\VXEFRROHGIOXLGV

6LJQLILFDQWUDGLDOH[SDQVLRQRIWKHMHWRFFXUVLQSUR[LPLW\\WRWKHEUHDNDVWKHMHWLQWHUDFWVZLWKWKH

DPELHQWSUHVVXUHRIWKHVXUURXQGLQJV7KLVLVWKHMHWFRUHWKDWH[WHQGVLQFUHDVLQJO\\IURPWKH

EUHDNDVWKHDPRXQWRIVXEFRROLQJLQFUHDVHV$QH[FHSWLRQWRWKHH[SDQGHGF\\OLQGHUVKDSHLV

WKHµFROGZDWHU¶MHWGXHWRDEUHDNLQDOLQHFDUU\\LQJSUHVVXUL]HGQRQH[SDQGLQJ QRQIODVKLQJ 

OLTXLG LHDWWHPSHUDWXUHVOHVVWKDQVDWXUDWLRQDWDPELHQWFRQGLWLRQV )IRUZDWHU ,QWKLV

FDVHWKHMHWGRHVQRWH[SDQGDQGWKXVIRUPVDFLUFXODUF\\OLQGHURIWKHVDPHGLDPHWHUDVWKH

EUHDN7KLVLVFRQVLVWHQWZLWKWKHWKHUPRG\\QDPLFGHVFULSWLRQRI185(*&5%DVHGRQ

WKHDERYHWKH15&VWDIIILQGVLWDFFHSWDEOHWKDWWKHIORZFDQEHWZRSKDVHZLWKDQLQLWLDO

VXEFRROHGMHWWKDWH[SDQGVLQWRDWZRSKDVHMHW

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21













&LUFXPIHUHQWLDO%UHDN-HW6KDSH



7KHGRXEOHHQGHGEUHDNUHVXOWVLQWZRMHWVLQLWLDOO\\GLUHFWHGRSSRVHGWRZDUGHDFKRWKHUZKLFK

DUHDVVXPHGWRQRWLQWHUIHUHZLWKHDFKRWKHUGXHWRIXOOVHSDUDWLRQ XQOHVVSLSLQJLVFRQVWUDLQHG

WROLPLWODWHUDOGLVSODFHPHQWDVGHVFULEHGEHORZ 7KHMHWVLQLWLDOO\\KDYHWKHFLUFXODUFURVV

VHFWLRQGHVFULEHGDERYHZLWKLQLWLDOIORZDUHDHTXDOWRSLSHIORZDUHDDQGGLUHFWHGD[LDOO\\

RXWZDUGIURPWKHEURNHQSLSHHQGLQDF\\OLQGHUOLNHVKDSH7KHMHWGLUHFWLRQDQGDVVXFKLWV

LPSLQJHPHQW]RQHFDQYDU\\VLJQLILFDQWO\\DVWKHSLSLQJHQGVGLVSODFH ZKLS XQOHVVUHVWUDLQHG

DVGHVFULEHGEHORZ&HUWDLQSLSLQJVXSSRUWFRQILJXUDWLRQVFDQEHVKRZQWRSUHFOXGHJURVV

XQOLPLWHGGHIOHFWLRQRIWKHVHYHUHGSLSHHQGV,IWKHVHYHUHGSLSHHQGLVFRQVWUDLQHGWR

VLJQLILFDQWO\\OLPLWODWHUDOGLVSODFHPHQWVVXFKDVE\\SLSLQJJXLGHVRUDGMDFHQWULJLGVWUXFWXUHV

DQGJURVVD[LDOPRYHPHQWRUXQOLPLWHGGLVWRUWLRQDERXWDSLSLQJµKLQJH¶LVQRWVWDWHGWKHSLSH

HQGDQGWKHMHWD[LVFDQEHFRQVLGHUHGIL[HG,IERWKVHYHUHGHQGVDUHVLPLODUO\\FRQVWUDLQHGWR

OLPLWODWHUDOHQGGHIOHFWLRQVWRDSSUR[LPDWHO\\RQHSLSHZDOOWKLFNQHVVHDFKWKHRSSRVLQJMHWVFDQ

EHWDNHQDVIXOO\\LQWHUIHUHG,QWKLVFDVHWKHMHWGLVFKDUJHVUDGLDOO\\RXWZDUGDERXWWKHSLSH

FLUFXPIHUHQFHDQGWKHMHWLPSLQJHPHQW]RQHOHQJWKLVJUHDWO\\UHGXFHG7KH15&VWDIIDJUHHV

WKDWLIDGRXEOHJXLOORWLQHEUHDN¶VGLVSODFHPHQWLVOLPLWHGWRRQHSLSHWKLFNQHVVWKHIORZZRXOG

EHLQWKHUDGLDOGLUHFWLRQZLWKDOLPLWHG=R,GXHWRWKHLQWHUIHUHQFHRIWKHRSSRVLQJIORZ%DVHG

RQWKHDERYHWKH15&VWDIIILQGVWKLVDFFHSWDEOH





/RQJLWXGLQDO%UHDN-HW6KDSH



7KHIOXLGMHWIURPDORQJLWXGLQDOEUHDNGLVFKDUJHVSHUSHQGLFXODUWRWKHSLSHD[LVDORQJDOLQH

IURPWKHFHQWHUOLQHRIWKHSLSHWKURXJKWKHFHQWHURIWKHEUHDNSODQH$VVXFKWKHSRVWXODWHG

ORFDWLRQRIWKHEUHDNDERXWWKHSLSHFLUFXPIHUHQFHGHILQHVWKHGLUHFWLRQRIWKHMHW%DVHGRQ

$16,$16 5HIHUHQFH PHWKRGRORJ\\WKHRULHQWDWLRQRIWKHMHWFDQEHSUHGLFWHGE\\WKH

SLSHILWWLQJRUIHDWXUHDWZKLFKWKHEUHDNLVSRVWXODWHG,ISRVWXODWHGEUHDNRULHQWDWLRQVDUH

ORQJLWXGLQDOEUHDNVDWWHHVRUHOERZVZKLFKRFFXULQGLYLGXDOO\\RQHDFKVLGHRIWKHILWWLQJDWLWV

FHQWHUDQGRULHQWHGSHUSHQGLFXODUWRWKHSODQHRIWKHILWWLQJ7KXVWKHMHWHPDQDWHVRXWZDUGLQ

WKHRXWRISODQHGLUHFWLRQ$WZHOGHGRQOXJDWWDFKPHQWVDVLGHQWLILHGE\\ILHOGZDONGRZQD

ORQJLWXGLQDOEUHDNLVSRVWXODWHGDWWKHFHQWHUOLQHRIWKHDWWDFKPHQW7KHMHWGLUHFWLRQLVUDGLDOO\\

RXWZDUGIURPWKHFHQWHURIWKHDWWDFKPHQW7KHEDVHVIRUMHWWKHUPRG\\QDPLFIRUFHVDUHVLPLODU

WRWKRVHIRUFLUFXPIHUHQWLDOEUHDNVVLQFHWKHEUHDNDUHDLVDVVXPHGWREHEDVHGRQWKHSLSH,'

LQERWKFDVHV+RZHYHUWKHGLUHFWLRQRIWKHMHWLVSUHGLFWDEOHVLQFHSLSHGHIOHFWLRQLVOLPLWHG

7KH15&VWDIIDJUHHVZLWKWKHSRVWXODWHGDVVXPSWLRQRIWKHRXWRISODQHIORZRIWKHMHWEHFDXVH

VXFKDFRQILJXUDWLRQKDVDJUHDWHUSRWHQWLDOWRLPSDFWDWDUJHWLQSUR[LPLW\\DQGLVWKHUHIRUH

DFFHSWDEOH





$UELWUDU\\,QWHUPHGLDWH%UHDNVDQG&ULWLFDO&UDFNV



7KHIROORZLQJFULWHULDDUHXVHGE\\WKHOLFHQVHHWRLGHQWLI\\WKH+(EUHDNW\\SHVUHTXLUHGWREH

SRVWXODWHGDWWKHLGHQWLILHGEUHDNORFDWLRQVDW2167KHUHDUHWKUHHW\\SHVRI+(/%VDW

216²FLUFXPIHUHQWLDOEUHDNVORQJLWXGLQDOEUHDNVDQGFULWLFDOFUDFNV7KHFULWHULDIRUHDFK

EUHDNW\\SHDUHDVIROORZV&LUFXPIHUHQWLDOEUHDNVDUHWREHSRVWXODWHGLQ+(OLQHVWKDW

H[FHHGRQHLQFKQRPLQDOSLSHVL]H2QO\\FLUFXPIHUHQWLDOEUHDNVDUHSRVWXODWHGDWWHUPLQDO

HQGVRI+(SLSLQJUXQV/RQJLWXGLQDOEUHDNVDUHWREHSRVWXODWHGLQ+(SLSLQJWKDWKDYHD

QRPLQDOSLSHVL]HRIIRXULQFKHVRUJUHDWHU&LUFXPIHUHQWLDODQGORQJLWXGLQDOEUHDNVDUHQRW

SRVWXODWHGWRRFFXUFRQFXUUHQWO\\/RQJLWXGLQDOEUHDNVDUHQRWSRVWXODWHGDWEUDQFK

FRQQHFWLRQV/RQJLWXGLQDOEUHDNVDUHSRVWXODWHGRQO\\DWLQWHUPHGLDWHEUHDNORFDWLRQV

/RQJLWXGLQDOEUHDNVDUHSRVWXODWHGSDUDOOHOWRWKHSLSHD[LVDQGRULHQWHGDWDOOSRLQWVRQWKH

SLSHFLUFXPIHUHQFH7KHEUHDNDUHDRIDORQJLWXGLQDOEUHDNLVHTXDOWRWKHHIIHFWLYHFURVV

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











VHFWLRQDOIORZDUHDRIWKHSLSHLPPHGLDWHO\\XSVWUHDPRIWKHEUHDNORFDWLRQ&ULWLFDOFUDFNVDUH

WREHSRVWXODWHGRQVHLVPLFDOO\\DQDO\\]HG+(SLSLQJWKDWH[FHHGVRQHLQFKLQQRPLQDOSLSH

VL]H7KH*LDPEXVVR6FKZHQFHUOHWWHUVSURYLGHFULWHULDWRGHWHUPLQHSLSHEUHDNRULHQWDWLRQ

DWEUHDNORFDWLRQVDQGVSHFLI\\WKDWORQJLWXGLQDOEUHDNVLQSLSLQJUXQVDQGEUDQFKUXQVEH

SRVWXODWHGIRUQRPLQDOSLSHVL]HVJUHDWHUWKDQRUHTXDOWRIRXULQFKHV&LUFXPIHUHQWLDO

EUHDNVDUHSRVWXODWHGDWDOOWHUPLQDOHQGV7KHGHVLJQRIH[LVWLQJDQGSRWHQWLDOO\\QHZUXSWXUH

UHVWUDLQWVPD\\EHXVHGWRPLWLJDWHWKHUHVXOWVIURPVXFKEUHDNVLQFOXGLQJSUHYHQWLRQRISLSH

ZKLSDQGDOWHUDWLRQRIWKHEUHDNIORZ/RQJLWXGLQDOEUHDNVDUHQRWSRVWXODWHGDWWHUPLQDO

HQGV7KH15&ILQGVWKLVWREHFRQVLVWHQWZLWKWKHJXLGHOLQHVRI%730(% 5HIHUHQFH

 DQGLVWKHUHIRUHDFFHSWDEOH





,QWHUPHGLDWH%UHDNV



7KHOLFHQVHHSRVWXODWHGFLUFXPIHUHQWLDODQGORQJLWXGLQDOEUHDNORFDWLRQVDVIROORZV

,QWHUPHGLDWHEUHDNVDUHSRVWXODWHGLQ&ODVVRUHTXLYDOHQWSLSLQJDWD[LDOORFDWLRQVZKHUHWKH

FDOFXODWHGORQJLWXGLQDOVWUHVVIRUWKHDSSOLFDEOHORDGFDVHVH[FHHGV 6D6K IRUSLSLQJWKDW

LVVHLVPLFDOO\\DQDO\\]HG7KHORDGFDVHVLQFOXGHLQWHUQDOSUHVVXUHGHDGZHLJKW JUDYLW\\ 

WKHUPDODQGVHLVPLF 2%( ,QWHUPHGLDWHEUHDNVDUHQRWSRVWXODWHGDWORFDWLRQVZKHUHWKHRQO\\

VWUHVVLVWKHWKHUPDOH[SDQVLRQVWUHVVZKLFKGRHVQRWFDXVHUXSWXUHVLQSLSHV7KH

  • LDPEXVVR6FKZHQFHUOHWWHUVFRQWDLQHGWKHJXLGHOLQHWRSRVWXODWHEUHDNORFDWLRQVZKHUHWKH

DFWXDOVWUHVVH[FHHGHG 6D6K KRZHYHU%730(%LQFOXGHVQRVXFKJXLGHOLQH7KH

OLFHQVHHFRQFOXGHGWKDWWKHRPLVVLRQRIWKHWKHUPDOVWUHVVWKUHVKROGLQ%730(%LV

UHFRJQLWLRQE\\WKHUHJXODWRU\\DXWKRULWLHVWKDWWKHUPDOVWUHVVLQWKHDEVHQFHRISULPDU\\VWUHVV

FDQQRWFDXVHSLSHUXSWXUHIDLOXUHV7KH15&VWDIIILQGVWKLVVWDWHPHQWWREHWUXHVLQFHWKHUPDO

VWUHVVHVDUHVHOIOLPLWLQJDQGFDQQRWFDXVHUXSWXUH%UHDNVDUHSRVWXODWHGLQDFFRUGDQFHZLWK

%730(%6HFWLRQ%F  E L IRUSLSLQJWKDWLVQRWULJRURXVO\\DQDO\\]HGRUGRHVQRWLQFOXGH

VHLVPLFORDGLQJVDWLQWHUPHGLDWHORFDWLRQV7KHOLFHQVHHVWDWHGWKDWV\\VWHPVDQGFRPSRQHQWV

ORFDWHGLQWKH$%RUWKH66)DUHDYDLODEOHIRUPLWLJDWLRQRIWKHHIIHFWVIURPWKHEUHDNV

SRVWXODWHGWRRFFXULQWKH7%$Q\\LQWHUDFWLRQVEHWZHHQQRQVHLVPLFSLSLQJDQGVHLVPLFSLSLQJ

ORFDWHGLQWKH7%ZLOOEHDGHTXDWHO\\PLWLJDWHGZLWKHTXLSPHQWIURPWKH$%RUWKH66)7KH

LGHQWLILHGSRWHQWLDOLQWHUDFWLRQVEHWZHHQQRQVHLVPLFDQGVHLVPLFSLSLQJDUHORFDWHGLQWKH7%

EHWZHHQWKHYDULRXVVHFRQGDU\\VLGH+(V\\VWHPVDQGSRUWLRQVRIWKHIROORZLQJV\\VWHPV():

06EUDQFKOLQHVVLSKRQVHDOZDWHUV\\VWHP&&:DQGWKHORZSUHVVXUHVHUYLFHZDWHU /36: 

V\\VWHP7KH15&VWDIIDFNQRZOHGJHVWKHVHLQWHUDFWLRQVLQWKH7%GXHWRWKHLUUHODWLYH

SUR[LPLWLHV



7KHOLFHQVHHVWDWHGWKDWWHUPLQDOHQGVDUHYHVVHOSXPSQR))OHVEXLOGLQJSHQHWUDWLRQVLQOLQH

DQFKRUVDQGEUDQFKWRUXQFRQQHFWLRQVWKDWDFWDVHVVHQWLDOO\\ULJLGFRQVWUDLQWVWRSLSLQJWKHUPDO

H[SDQVLRQ$EUDQFKPRGHOHGDSSURSULDWHO\\LQDULJRURXVVWUHVVDQDO\\VLVZLWKWKHUXQIOH[LELOLW\\

DQGDSSOLHGEUDQFKOLQHPRYHPHQWVLQFOXGHGDQGZKHUHWKHEUDQFKFRQQHFWLRQVVWUHVVLV

DFFXUDWHO\\NQRZQWKHVWUHVVFULWHULDQRWHGDERYHLVXVHGIRUSRVWXODWLQJEUHDNVORFDWLRQV,Q

RUGHUIRUWKHEUDQFKFRQQHFWLRQVWUHVVWREHDFFXUDWHO\\DVVHVVHGWKHEUDQFKOLQHPXVWEH

LQFOXGHGLQWKHVWUHVVPRGHORIWKHPDLQUXQ7KH15&VWDIIILQGVWKLVVWDWHPHQWWREHLQ

DFFRUGDQFHZLWK%730(%6HFWLRQ%F  D )RUWKRVHFDVHVZKHUHWKHEUDQFKOLQHLV

QRWLQFOXGHGLQWKHVWUHVVPRGHORIWKHPDLQUXQWHUPLQDOHQGEUHDNVDUHSRVWXODWHGRQWKH

EUDQFKVLGHRIWKHFRQQHFWLRQ)RUXQDQDO\\]HGEUDQFKFRQQHFWLRQVRUZKHUHWKHVWUHVVDWWKH

EUDQFKFRQQHFWLRQLVQRWDFFXUDWHO\\NQRZQEUHDNORFDWLRQVDUHSRVWXODWHGLQDFFRUGDQFHZLWK

%730(%6HFWLRQ%F  E L 7KH*LDPEXVVR6FKZHQFHUOHWWHUVGRQRWGLUHFWO\\DGGUHVV

WKHSRVWXODWLRQRIWHUPLQDOHQGEUHDNVLQ&ODVVDQGHTXLYDOHQWSLSLQJDWLVRODWLRQYDOYHVWKDW

VHSDUDWH+(V\\VWHPVRUVXEV\\VWHPVIURPQRQ+(V\\VWHPVRUVXEV\\VWHPV7KH%730(%

IRRWQRWHH[SDQGVWKHGHILQLWLRQRIWHUPLQDOHQGVEH\\RQGWKDWSURYLGHGLQ*LDPEXVVR6FKZHQFHU

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











WRLQFOXGHLVRODWLRQYDOYHVWKDWVHSDUDWHSLSLQJWKDWLVQRUPDOO\\PDLQWDLQHGDW+(FRQGLWLRQVIURP

RWKHUSLSLQJWKDWLVQRWQRUPDOO\\PDLQWDLQHGDW+(FRQGLWLRQV7KH*LDPEXVVR6FKZHQFHU

OHWWHUVSURYLGHH[SHFWDWLRQWKDWWKHSRVWXODWLRQRIWHUPLQDOHQGEUHDNVDWULJLGO\\IL[HGYDOYHVWKDW

PD\\DFWWRUHVWUDLQWKHUPDOPRYHPHQW7KHOLFHQVHHLQGLFDWHGWKDWWKHUHDUHQRVXFKULJLGO\\

IL[HGLVRODWLRQYDOYHVWKDWVHUYHDVDERXQGDU\\EHWZHHQ+(V\\VWHPVRUVXEV\\VWHPVDQGQRQ+(

V\\VWHPVRUVXEV\\VWHPVDW2FRQHH$OOVLPLODULVRODWLRQYDOYHVDUHµLQOLQHYDOYHV¶WKDWDUHQRW

LQGHSHQGHQWO\\VXSSRUWHGLQDZD\\WKDWSURKLELWSLSLQJPRWLRQDQGWKHUPDOPRYHPHQW7KH

OLFHQVHHGRHVDQDO\\]HWKHDSSOLFDEOH+(SLSLQJV\\VWHPVULJRURXVO\\IRUDSSOLFDEOHGHVLJQORDGV

LQFOXGLQJVHLVPLF%UHDNVDUHSRVWXODWHGDWORFDWLRQVZKHUHWKHDFWXDOFDOFXODWHGSULPDU\\VWUHVV

ORQJLWXGLQDOSUHVVXUHJUDYLW\\DQG2%( DQGVHFRQGDU\\VWUHVVH[FHHGWKHVWUHVVWKUHVKROGV

JLYHQLQ%730(%6HFWLRQ%F  )RUDOORWKHUV\\VWHPVRUVXEV\\VWHPVEUHDNVDUH

SRVWXODWHGWRRFFXUDWDOOZHOGVDQGILWWLQJV7KHOLFHQVHHLQGLFDWHGWKDWWKHUHDVRQIRUQRW

SRVWXODWLQJEUHDNVDWLVRODWLRQYDOYHVEHWZHHQ+(SLSLQJDQGQRQ+(SLSLQJIRUV\\VWHPVRU

VXEV\\VWHPVWKDWDUHULJRURXVO\\DQDO\\]HGLVEDVHGRQWKHVLPLODULWLHVEHWZHHQDEUDQFK

FRQQHFWLRQWKDWLVDSSURSULDWHO\\DQDO\\]HGLQWKHVWUHVVDQDO\\VLV7KHOLFHQVHHDOVRLQGLFDWHGWKLV

IRUDFORVHGLVRODWLRQYDOYHWKDWLVDSSURSULDWHO\\DQDO\\]HGLQWKHVWUHVVDQDO\\VLV7KH15&VWDII

DJUHHVWKDWDQLVRODWLRQYDOYHFDQEHFRQVLGHUHGDVDEUDQFKDSDUWRIWKHPDLQUXQLIWKHVWUHVV

DQDO\\VLVVKRZVWKDWLWKDVDVLJQLILFDQWLPSDFWRQWKHPDLQUXQ¶VEHKDYLRUDQGWKHUHIRUHQHHGV

QRWEHFRQVLGHUHGDVDWHUPLQDOHQG%DVHGRQWKHDERYHWKH15&VWDIIILQGVWKLVDFFHSWDEOH





3RVWXODWLRQRI&ULWLFDO&UDFNV



)RUWKHSRVWXODWLRQRIFULWLFDOFUDFNVWKHDSSOLFDELOLW\\LVDVIROORZV)RUSLSLQJWKDWLVVHLVPLFDOO\\

DQDO\\]HGFULWLFDOFUDFNVDUHSRVWXODWHGLQ&ODVVRUHTXLYDOHQWSLSLQJDWD[LDOORFDWLRQVZKHUH

WKHFDOFXODWHGORQJLWXGLQDOVWUHVVIRUWKHDSSOLFDEOHORDGFDVHVH[FHHGV 6D6K $SSOLFDEOH

ORDGFDVHVLQFOXGHLQWHUQDOSUHVVXUHGHDGZHLJKW JUDYLW\\ WKHUPDODQGVHLVPLF 2%( )RU

QRQVHLVPLFDOO\\DQDO\\]HGSLSLQJFULWLFDOFUDFNVDUHQRWSRVWXODWHGVLQFHWKHHIIHFWVRI

SRVWXODWHGFLUFXPIHUHQWLDODQGORQJLWXGLQDOEUHDNVDWWKHVHORFDWLRQVZLOOERXQGWKHHIIHFWVIURP

FULWLFDOFUDFNV$FWXDOVWUHVVHVXVHGIRUFRPSDULVRQWRWKHEUHDNDQGFUDFNWKUHVKROGVQRWHG

DERYHDUHFDOFXODWHGLQDFFRUGDQFHZLWKWKH216SLSLQJFRGHRIUHFRUG86$6% 

(GLWLRQ $OORZDEOHVWUHVVYDOXHV6DDQG6KDUHGHWHUPLQHGLQDFFRUGDQFHZLWKWKH86$6

%FRGH 5HIHUHQFH RUWKH86$6%&RGH )HEUXDU\\'UDIW(GLWLRQZLWK(UUDWD 

5HIHUHQFH DQGDUHWKHUHIRUHDFFHSWDEOH





'\\QDPLF$QDO\\VLV



7KH*LDPEXVVR6FKZHQFHU,WHPUHTXHVWHGDVXPPDU\\RIWKHG\\QDPLFDQDO\\VHVDSSOLFDEOHWR

WKHGHVLJQRI&DWHJRU\\,SLSLQJDQGDVVRFLDWHGVXSSRUWVZKLFKGHWHUPLQHWKHUHVXOWLQJORDGLQJV

DVDUHVXOWRIDSRVWXODWHGSLSHEUHDN



'\\QDPLFDQDO\\VHVZHUHSHUIRUPHGLQDFFRUGDQFHZLWK6HFWLRQ,,,&ODVVHTXLYDOHQWSLSLQJ

0)':DQG06 SRVWXODWHG+(/%VLQWKH(35WRGHWHUPLQHWKHLQWHUQDOSUHVVXUL]DWLRQRIWKH

URRP'\\QDPLFDQDO\\VHVZHUHDOVRSHUIRUPHGIRUSRVWXODWHG3++(/%VLQWKHYHQWLODWLRQ

HTXLSPHQWURRPVLQWKH$%WRGHWHUPLQHLQWHUQDOSUHVVXUL]DWLRQRIWKRVHURRPV([FHSWIRUWZR

0)':UXSWXUHUHVWUDLQWVORFDWHGLQWKH(35HYDOXDWLRQVRIWKHHIIHFWVRIZKLSDQGMHW

LPSLQJHPHQWDVVRFLDWHGZLWKSRVWXODWHG+(/%ORFDWLRQVDVVXPHGXQUHVWUDLQHGOLQHV



'\\QDPLFDQDO\\VHVZHUHGRQHIRUSRVWXODWHGEUHDNVWKDWUHTXLUHGDG\\QDPLFDQDO\\VLV'\\QDPLF

DQDO\\VHVZHUHQRWUHTXLUHGIRUEUHDNVSRVWXODWHGWRRFFXULQWKH7%WRGHWHUPLQHLQWHUQDO

SUHVVXUL]DWLRQVLQFHWKHYROXPHRIWKHEXLOGLQJLVODUJHDQGFRQWDLQVQXPHURXVRSHQLQJVVXFK

WKDWLQWHUQDOSUHVVXUL]DWLRQRIWKHEXLOGLQJLVLQVLJQLILFDQW0RUHRYHUEUHDNVZLWKLQWKH7%ZHUH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

















PLWLJDWHGE\\V\\VWHPVFUHGLWHGRXWVLGHRIWKH7%+RZHYHUZKHUHWKHURRPLVVPDOOZLWKRXW

RSHQLQJVDVZLWKWKH(35DQGWKHYHQWLODWLRQHTXLSPHQWURRPVRIWKH$%G\\QDPLFDQDO\\VHV

GHWHUPLQHGWKHLQWHUQDOSUHVVXUL]DWLRQRIWKHURRP7KH15&VWDIIDJUHHVWKDWZKHQWKH

YROXPHRIWKHEXLOGLQJLVODUJHWKHSUHVVXUL]DWLRQGXHWRD+(/%LVLQVLJQLILFDQWVLQFHWKH

UHOHDVHLVLQVLJQLILFDQWFRPSDUHGWRWKHYROXPH

'\\QDPLFDQDO\\VHVRI+(&DWHJRU\\,SLSLQJSRVWXODWHG+(/%VDQGWKHHIIHFWRQDVVRFLDWHG

VXSSRUWVZHUHQRWSHUIRUPHGE\\WKHOLFHQVHHH[FHSWIRUWZR0)':UXSWXUHUHVWUDLQWVORFDWHG

LQWKH(357KHVXEVHTXHQWHYDOXDWLRQVRIWKHLPSDFWRIZKLSDQGMHWLPSLQJHPHQW

DVVRFLDWHGZLWKSRVWXODWHG+(/%VDVVXPHGXQUHVWUDLQHGOLQHV7KHUHIRUHWKHG\\QDPLF

UHVSRQVHIRUWKHVH+(/%VGLGQRWQHHGWREHGHWHUPLQHGVLQFHQRQHRIWKHVXSSRUWVLQWKH

OLQHVZHUHGHVLJQHGWRDEVRUEWKHVHORDGV+RZHYHUWKH66'HTXLSPHQWORFDWHGLQWKH=R,RI

WKHVHEUHDNVZHUHDVVXPHGWRIDLO

)RUWKHSRVWXODWHG+(/%VMHWLPSLQJHPHQWIRUFHVZHUHGHWHUPLQHGLQDFFRUGDQFHZLWK

$16,$16$IWHUWKHMHWLPSLQJHPHQWIRUFHVZHUHGHWHUPLQHGSODVWLFKLQJHVZHUH

SRVWXODWHGDQGZKLSLQWHUDFWLRQ]RQHVZHUHHVWDEOLVKHG$IWHUWKDWVXUYH\\VZHUHPDGHRI

WKHLQWHUDFWLRQ]RQHVWRLGHQWLI\\DQ\\66'HTXLSPHQW66'HTXLSPHQWORFDWHGZLWKLQWKH

LQWHUDFWLRQ]RQHVZHUHFRQVLGHUHGWREHGDPDJHGDQGUHQGHUHGQRQIXQFWLRQDO

7KHPLWLJDWLRQVWUDWHJ\\IRUSRVWXODWHG+(/%VLVWKHDYDLODELOLW\\RIRWKHUHTXLSPHQWUHPRWH

IURPWKHSRVWXODWHG+(/%ORFDWLRQWKDWFRXOGEHXVHGWREULQJWKHDIIHFWHGXQLWWRDQ66'

VWDWH7KHQXPEHUDQGORFDWLRQRIEUHDNVZHUHGRFXPHQWHGLQFDOFXODWLRQ26&7KH

RULHQWDWLRQRIWKHEUHDNVZDVGRFXPHQWHGLQVXEMHFWFDOFXODWLRQ%DVHGRQWKHOLFHQVHH¶V

VXPPDU\\RIWKHG\\QDPLFDQDO\\VHVDSSOLFDEOHWRWKHGHVLJQRI&DWHJRU\\,SLSLQJDQG

DVVRFLDWHGVXSSRUWVZKLFKGHWHUPLQHWKHUHVXOWLQJORDGLQJVDVDUHVXOWRISRVWXODWHGSLSH

EUHDNVWKH15&VWDIIILQGVWKDWWKHOLFHQVHH¶VDQDO\\VLVLVDFFHSWDEOH





15&6WDII&RQFOXVLRQ5HJDUGLQJ+(/%/RFDWLRQVDQG%UHDN7\\SHV



7KH15&VWDIIUHYLHZHGWKHOLFHQVHH¶VPHWKRGIRULGHQWLI\\LQJSRVWXODWHG+(/%ORFDWLRQVDQG

EUHDNW\\SHV7KHMHWLPSLQJHPHQWIRUFHVMHWLPSLQJHPHQWFRQHJHRPHWU\\DQGMHWLPSLQJHPHQW

HIIHFWLYHOHQJWKZHUHGHWHUPLQHGLQDFFRUGDQFHZLWK185(*&57KHWKUXVWORDGVIRU

HYDOXDWLQJSRWHQWLDOLQWHUDFWLRQVEHWZHHQSRVWXODWHG+(/%VDQGVWUXFWXUDOFRPSRQHQWVZHUH

GHWHUPLQHGLQDFFRUGDQFHZLWK$16,$167KHUHVXOWVRIWKHOLFHQVHH¶VDQDO\\VHVDUH

FRQVLVWHQWZLWKHVWDEOLVKHGPHWKRGRORJ\\DQGUHJXODWRU\\SRVLWLRQV%DVHGRQWKHDERYHWKH

15&VWDIIFRQFOXGHVWKDWWKHOLFHQVHH¶VPHWKRGVIRULGHQWLI\\LQJSRVWXODWHG+(/%ORFDWLRQVDQG

EUHDNW\\SHVLVDFFHSWDEOH





'HWHUPLQDWLRQRIWKH(TXLSPHQWDQG6\\VWHPVWR0LWLJDWH3RVWXODWHG+(/%V



7KHOLFHQVHHLGHQWLILHGWKHIROORZLQJIXQFWLRQVWRPHHWVDIHVKXWGRZQREMHFWLYHVLQWKHSURSRVHG

FKDQJHVWR2FRQHH8)6$56HFWLRQ³)XQFWLRQVWR0HHW6DIH6KXWGRZQ2EMHFWLYHV'

DVLQFOXGHGLQ$WWDFKPHQWWRWKH/$5



x

5HDFWLYLW\\&RQWURO

x

5&6,QYHQWRU\\&RQWURO

x

5&63UHVVXUH&RQWURO

x

5&6+HDW5HPRYDO&RQWURO

x

5HDFWRU%XLOGLQJ %RXQGDU\\ ,QWHJULW\\

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











x

&RQWURO5RRP+DELWDELOLW\\ ORQJWHUP 

x

3ODQW&RROGRZQ

x

3URFHVV0RQLWRULQJ

x

6XSSRUW)XQFWLRQV



7KHVHIXQFWLRQVDUHSHUIRUPHGE\\DVHWRIQRUPDOSODQWV\\VWHPVIRUPRVWLQLWLDWLQJHYHQWVWKDW

UHVXOWLQDORVVRIWKHQRUPDOSRZHUFRQYHUVLRQV\\VWHP5HDFWLYLW\\FRQWUROLVSHUIRUPHGE\\WKH

FRQWUROURGV\\VWHPDQGE\\DGGLWLRQRIQHXWURQSRLVRQVXVLQJWKH+3,V\\VWHPZKLFKDOVR

FRQWULEXWHVWRWKH5&6LQYHQWRU\\FRQWUROIXQFWLRQWKURXJKLQMHFWLRQDQGOHWGRZQ7KH5&6

SUHVVXUHFRQWURODQGKHDWUHPRYDOFRQWUROIXQFWLRQVDUHUHODWHGDQGSHUIRUPHGE\\DFRPELQDWLRQ

RIGHOLYHULQJ6*)':WKURXJKWKH():V\\VWHPDQGUHOHDVLQJVWHDPWRWKHDWPRVSKHUHWKURXJK

WKH0659VRUWKHDWPRVSKHULFGXPSYDOYHV $'9V YLDWKH06V\\VWHP3UHVVXUHFRQWUROLV

DOVRVXSSRUWHGE\\XVHRISUHVVXUL]HUKHDWHUV3ODQWFRROGRZQWR&ROG6KXWGRZQLQYROYHV

DGGLWLRQDOV\\VWHPVIRUVHQVLEOHKHDWUHPRYDOLQFOXGLQJWKH/3,V\\VWHPIRUVKXWGRZQFRROLQJ

FLUFXODWLRQDQG/36:WRWUDQVIHUWKHKHDWWRDQXOWLPDWHKHDWVLQN5HDFWRUEXLOGLQJLQWHJULW\\

FRQWUROURRPKDELWDELOLW\\DQGSURFHVVPRQLWRULQJIXQFWLRQVLQWKHFRQWH[WRI+(/%VDUH

HQVXUHGE\\DSSURSULDWHGHVLJQRIVWUXFWXUHVDQGVXSSRUWVWRSURWHFWWKH66&VWKDWSHUIRUPWKH

IXQFWLRQV(OHFWULFDOSRZHULVDNH\\VXSSRUWIXQFWLRQIRUPDQ\\RIWKHDERYHIXQFWLRQVDQG

HOHFWULFDOGLVWULEXWLRQV\\VWHPVDUHSDUWLFXODUO\\YXOQHUDEOHWRWKHHQYLURQPHQWDOHIIHFWVSURGXFHG

E\\+(/%V



7KH36:V\\VWHPDQGWKH66)DUHGHIHQVHLQGHSWKV\\VWHPVWKDWSHUIRUPPDQ\\RIWKHNH\\

IXQFWLRQVXVLQJDOWHUQDWHHTXLSPHQW7KHVHV\\VWHPVSURYLGHDOWHUQDWHVRXUFHVRI)':IRUWKH

6*VDQGDOWHUQDWHHOHFWULFDOGLVWULEXWLRQV\\VWHPVWRVXSSRUWWKHNH\\VDIHW\\IXQFWLRQVLQDGGLWLRQ

WRRWKHUFDSDELOLWLHV



7KHOLFHQVHHLGHQWLILHGWKHIROORZLQJWKUHHFODVVHVRIVLJQLILFDQW+(/%VRXWVLGHFRQWDLQPHQWDW

2FRQHH



x

2YHUKHDWLQJHYHQWVWKDWUHVXOWIURPDORVVRIKHDWWUDQVIHU LHORVVRI6*)': 

x

2YHUFRROLQJHYHQWVWKDWUHVXOWIURPH[FHVVLYHKHDWWUDQVIHU LHORVVRI06V\\VWHP

SUHVVXUHERXQGDU\\LQWHJULW\\ 

x

/RVVRIUHDFWRUFRRODQWLQYHQWRU\\ LHOHWGRZQOLQHEUHDN 



7RHVWDEOLVKWKHQRUPDOSODQWV\\VWHPV36:DQGRU66)DVWKHDVVXUHGPLWLJDWLRQSDWK

IROORZLQJD+(/%WKHOLFHQVHHVXPPDUL]HGWKHLU+(/%FULWHULDDVIROORZV



 7KHUHDFWRUFDQEHVKXWGRZQDQGPDLQWDLQHGLQDQ66'FRQGLWLRQDQGVXEVHTXHQWO\\

FRROHGWRWKH&6'FRQGLWLRQLQWKHHYHQWRIDSRVWXODWHGUXSWXUHRXWVLGHRIWKH

FRQWDLQPHQWEXLOGLQJRIDSLSHFRQWDLQLQJD+(IOXLGLQFOXGLQJWKHGRXEOHHQGHGUXSWXUH

RIWKHODUJHVWSLSHLQWKH06DQG)':V\\VWHPV



 3ODQW66&VUHTXLUHGWRVDIHO\\VKXWGRZQWKHUHDFWRUDQGPDLQWDLQLWLQDQ66'FRQGLWLRQ

VKRXOGEHSURWHFWHGRUGHVLJQHGWRZLWKVWDQGWKHHIIHFWVRIVXFKDSRVWXODWHGSLSH

IDLOXUH



7KHPLWLJDWLRQVWUDWHJ\\IRUEUHDNVRUFUDFNVSRVWXODWHGWRRFFXULQWKH7%LVEDVHGRQXVHRI

V\\VWHPVDQGHTXLSPHQWORFDWHGLQWKH$%RUWKH66)WRUHDFKDQ66'FRQGLWLRQ)RUWKH

PLWLJDWLRQVWUDWHJ\\IRUEUHDNVRUFUDFNVSRVWXODWHGWRRFFXULQWKH$%WKHOLFHQVHHUHOLHVRQ

VHSDUDWLRQRUSURWHFWLRQRIFHUWDLQ66&VIURP+(/%HIIHFWVXVLQJHLWKHUQRUPDOSODQWV\\VWHPRU

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











WKH66)WRUHDFKDQ66'FRQGLWLRQ)RUWKH2FRQHHPLWLJDWLRQVWUDWHJ\\µ6DIH6KXWGRZQ¶LV

GHILQHGDVWKHWUDQVLWLRQRIDQ216XQLWIURPD0RGHRU0RGHFRQGLWLRQWRD+RW6WDQGE\\

0RGH VWDWHZLWKVWDEOH5&6FRQGLWLRQVDQGPDLQWDLQLQJWKLVVWDWHZLWKRXWDGYHUVHO\\

LPSDFWLQJWKHKHDOWKDQGVDIHW\\RIWKHSXEOLF7KLVLVXQLTXHWR2FRQHHDVFRPSDUHGWRRWKHU

3:5VWKDWZRXOGQRUPDOO\\JRWR0RGH





6KXWGRZQ6HTXHQFH(YDOXDWLRQ



7KHOLFHQVHHDGGUHVVHG*LDPEXVVR6FKZHQFHU,WHPLQ$WWDFKPHQWWRWKH/$57KLVLWHP

UHTXHVWVDVXPPDU\\RIWKHHPHUJHQF\\SURFHGXUHVWKDWZRXOGEHIROORZHGDIWHUDSLSHEUHDN

HYHQWRUDFFLGHQWLQFOXGLQJWKHDXWRPDWLFDQGPDQXDORSHUDWLRQVUHTXLUHGWRSODFHWKHUHDFWRU

XQLW V LQD&6'FRQGLWLRQ7KHOLFHQVHHSURYLGHGDVXPPDU\\RIWKHDFWLRQVQHFHVVDU\\WRVDIHO\\

VKXWGRZQWKHDIIHFWHGXQLWVIRUWKHVSHFWUXPRISRVWXODWHG+(/%HYHQWVLQ6HFWLRQ

³2SHUDWLRQV5HVSRQVH7UDLQLQJDQG3URFHGXUHV'RIWKH(QFORVXUHWRWKH/$57R

GHPRQVWUDWHWKHSODQWDELOLW\\WRVKXWGRZQIROORZLQJ+(/%VLQHLWKHUWKH7%RU$%WKHOLFHQVHH

SURYLGHGERXQGLQJVFHQDULRVEDVHGRQFRQVHTXHQFHVRIWKH+(/%ZLWKUHVSHFWWRRSHUDWRU

DFWLRQVQHFHVVDU\\UHSDLUVPDQSRZHUUHTXLUHPHQWVDQGWKHDVVRFLDWHGWLPHOLPLWVIRU

SHUIRUPLQJWKHVHDFWLRQV7KHOLFHQVHHGHWHUPLQHGWKDW+(/%VRFFXUULQJLQVLGHWKH7%KDYH

WKHSRWHQWLDOWRFUHDWHWKHPRVWERXQGLQJRYHUKHDWLQJVFHQDULRLQYROYLQJUHTXLUHGRSHUDWRU

DFWLRQVPDQSRZHUUHTXLUHPHQWVDQGGDPDJHUHSDLUV)RURYHUFRROLQJVFHQDULRVWKH

ERXQGLQJVFHQDULRLVSUHVHQWHGDVDGRXEOH06+(/%LQWKH7%UHVXOWLQJLQDORVVRIDOO$&

SRZHUDQGUHDFWRUWULS7KHOLFHQVHHKDVLGHQWLILHGDQXPEHURI7&$VDVSDUWRIWKH+(/%

PLWLJDWLRQ HJDFWLRQVWRVWDUWWKH36:V\\VWHPLQLWLDWHWKH66)RUOLPLWIORRGLQJE\\WULSSLQJWKH

&&:SXPSV DQGWKH15&VWDII¶VHYDOXDWLRQRIWKHVHDFWLRQVLVSURYLGHGLQ6HFWLRQRIWKLV

6($PRUHGHWDLOHGDVVHVVPHQWRIHDFKSRVWXODWHGOLPLWLQJ+(/%VFHQDULRLVSUHVHQWHGEHORZ





2YHUKHDWLQJ6FHQDULRV



7KHRYHUKHDWLQJDQDO\\VLVFRQVLGHUVDIDXOWHG0)':OLQHZKLOHDVVXPLQJWKH06OLQHVUHPDLQ

LQWDFWWRPD[LPL]HWKHRYHUKHDWLQJ7KHVHHYDOXDWHGHYHQWVDUHGLVFXVVHGLQ6HFWLRQ

³2YHUKHDWLQJ6FHQDULRV'RIWKH(QFORVXUHWRWKH/$5DQGDUHIXUWKHUGHVFULEHGLQ$WWDFKPHQW

WRWKH/$5



0LWLJDWLRQRIWKHVHSRVWXODWHG+(/%VLVGLYLGHGLQWRIRXUGLVWLQFWSKDVHV3KDVHLVUHDFWRU

VKXWGRZQDQGWKHVWDELOL]DWLRQRIWKHDIIHFWHGXQLW V LQ0RGHZLWK5&DYHUDJHWHPSHUDWXUH

)3KDVHLVSODQWFRROGRZQIURP0RGHWR0RGH ) 3KDVHLVWKH

DVVHVVPHQWDQGUHSDLURI66&VUHTXLUHGWRWUDQVLWLRQWKHXQLWIURP0RGH ) WR0RGH

) 3KDVHLVSODQWFRROGRZQWR0RGH ) 





0DLQ)HHGZDWHU/LQH%UHDNLQWKH7XUELQH%XLOGLQJ



7KHOLFHQVHHHYDOXDWHG)':+(/%VLQWKH7%DVGHVFULEHGLQ$WWDFKPHQWWRWKH/$5DQG

LQFOXGHGVFHQDULRVZKHUH9$&LVPDLQWDLQHGWKURXJKRXWWKHWUDQVLHQWDQGVFHQDULRV

ZKHUHRIIVLWHSRZHULVORVWDQG9$&SRZHULVUHVWRUHGE\\WKHHPHUJHQF\\SRZHUVRXUFH

WKH.HRZHH+\\GURHOHFWULF8QLWV



7KHSRVWXODWHG0)':+(/%VZLWKLQWKH7%FRXOGFDXVHDORVVRI$&SRZHUWRDOOWKUHHXQLWV

KHQFRXSOHGZLWKIDLOXUHVWR&&:SLSLQJUHVXOWLQJLQ7%IORRGLQJWKHOLFHQVHHFRQVLGHUHGWKLV

VFHQDULRZRXOGEHWKHERXQGLQJRYHUKHDWLQJVFHQDULRIRUDFWLYLWLHVQHFHVVDU\\WRSODFHWKHXQLWV

LQ0RGH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











7KH&ODVV(HOHFWULFDOV\\VWHPPD\\EHGDPDJHGE\\SRVWXODWHG+(/%VLQVLGHWKH7%7KH

GLUHFWHIIHFWV SLSHZKLSDQGMHWLPSLQJHPHQW IURPVRPH+(/%VPD\\UHVXOWLQGDPDJHWRWKH

9$&VZLWFKJHDU9$&PDLQIHHGHUEXVHVRUDVVRFLDWHGFDEOLQJWKDWPD\\UHVXOWLQ

ORVVRIWKHSRZHUVRXUFHVWRWKH9$&9$&HOHFWULFDOGLVWULEXWLRQV\\VWHPV7KHHIIHFW

ZRXOGEHVLPLODUWRDQ6%27RDGGUHVVWKHORVVRIWKHVHSRZHUVRXUFHVWZRDOWHUQDWHPHDQV

RIDFKLHYLQJDQ66'FRQGLWLRQDUHDYDLODEOHWKURXJKWKH36:V\\VWHPDQGWKH66)7KHVH

DOWHUQDWHPHDQVRIDFKLHYLQJDQGPDLQWDLQLQJDQ66'FRQGLWLRQDUHSURYLGHGWRDGGUHVVVLQJOH

DFWLYHIDLOXUHIRULQLWLDOPLWLJDWLRQ



+(/%VUHVXOWLQJLQWKHORVVRISODQWV\\VWHPVLQVLGHWKH7%QHHGHGIRU66'DUHPLWLJDWHGE\\WKH

DYDLODEOH66)DQG36:V\\VWHP6KRXOGWKH36:V\\VWHPEHXQDYDLODEOHWKH66)LVFUHGLWHG

DVDQDOWHUQDWHPHDQVRIDFKLHYLQJDQGPDLQWDLQLQJ66'IROORZLQJ+(/%VWKDWGLVDEOHSODQW

V\\VWHPVLQVLGHWKH7%%RWK36:DQG66)DUHORFDWHGRXWVLGHWKH7%VRIORRGLQJZLWKLQWKH

7%ZRXOGQRWLPSDFW36:RU66)RSHUDWLRQ



7KLVSRVWXODWHG0)':+(/%UHVXOWVLQDQRYHUKHDWLQJFRQGLWLRQIRUWKH5&67KHUHDFWRU

SURWHFWLRQV\\VWHP 536 ZLOOWULSWKHUHDFWRURQWKHORVVRI0)':SXPSVRURQKLJK5&6

SUHVVXUH2SHUDWRUDFWLRQVDUHQHHGHGWRUHVWRUHVHFRQGDU\\VLGH'+5DQG5&3VHDOFRROLQJWR

HVWDEOLVKDQ66'FRQGLWLRQ



3KDVH5HDFWRU6KXWGRZQ



5HDFWRUVKXWGRZQDQGWKHVWDELOL]DWLRQRIWKHDIIHFWHGXQLW V LQ0RGHZLWK5&DYHUDJH

WHPSHUDWXUH)



7KHRYHUKHDWLQJFRQGLWLRQIRUWKH5&6ZLOOUHVXOWLQWULSRIWKHUHDFWRURQWKHORVVRI0)':

SXPSVRURQKLJK5&6SUHVVXUH(PHUJHQF\\SURFHGXUHVGLUHFWWKHRSHUDWRUVWRLQLWLDWHERWK

36:DQG66)SDWKZD\\VLQSDUDOOHO7KHOLFHQVHHLGHQWLILHGERWKDFWLRQVWRHVWDEOLVKVHFRQGDU\\

VLGH'+5ZLWKWKH36:V\\VWHPDQGZLWKWKH66)$6:SXPSZLWKLQPLQXWHVRIDORVVRI

0)':DQG():DV7&$V(VWDEOLVKLQJ66)$6:IORZZLWKLQPLQXWHVLVDQH[LVWLQJWLPH

FULWLFDORSHUDWRUDFWLRQ



8VLQJWKH36:V\\VWHPWKH36:FRPSRQHQWV ORFDWHGZLWKLQ36:EXLOGLQJ DQG+3, ORFDWHGLQ

EDVHPHQWRI$% SURYLGHFDSDELOLW\\IRUDFKLHYLQJ66'7KH36:LVDOLJQHGWRWKHDIIHFWHGXQLW

GHOLYHULQJIORZWRWKH6*VWKURXJK():SLSLQJIRULQYHQWRU\\FRQWURODQGD36:SRZHUHG+3,

SXPSLVXWLOL]HGWRSURYLGH5&3VHDOFRROLQJ2SHUDWRUVDOLJQ36:SRZHURXWVLGHWKH7%WR

VHOHFWHGSUHVVXUL]HUKHDWHUVDQGWKHRSHUDWRUVF\\FOHWKHKHDWHUVDVQHFHVVDU\\WRFRQWURO5&6

SUHVVXUH



,IWKH36:V\\VWHPLVXQDYDLODEOHWKHDOWHUQDWH66)ZRXOGEHXVHGWREULQJWKHUHDFWRUWRVKXW

GRZQFRQGLWLRQ7KH66)GLHVHOJHQHUDWRU '* LVHPHUJHQF\\VWDUWHGDQGDOLJQHGWRWKH66)

HOHFWULFDOV\\VWHP7KH66)$6:SXPSLVVWDUWHGWRSURYLGHLQYHQWRU\\WR6*V7KH66)5&08

SXPSLVVWDUWHGWRUHVWRUH5&3VHDOFRROLQJ7KH66)$6:IORZLVSURYLGHGWRWKH6*VWR

UHGXFHDQGPDLQWDLQ5&6SUHVVXUH7KH66)$6:FRQQHFWLRQWR():SLSLQJLVORFDWHGZLWKLQ

WKH$%DQGFRQQHFWHGXSVWUHDPRI6*VDQGGRZQVWUHDPRI():SXPSV$VVXFKWKH66)

IXQFWLRQVDUHFRQVLGHUHGLQGHSHQGHQWRI7%+(/%HIIHFWV



$Q66'FRQGLWLRQFDQEHPDLQWDLQHGIURPHLWKHUWKHPDLQ&5XVLQJWKH36:DQG+3,V\\VWHPV

RUIURPWKH66)&5XVLQJWKH66)$6:DQG66)5&086\\VWHPV7KHUHDUHQRUHTXLUHG

UHSDLUVIURPWKHVHSRVWXODWHG+(/%VWRDFKLHYH66'LQ0RGHXVLQJHLWKHUWKH36:V\\VWHPRU

WKH66)

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











3KDVH3ODQW&RROGRZQWR0RGH ) 



3ODQWFRROGRZQUHTXLUHVRQH36:SRZHUHG+3,SXPSWRSURYLGHPDNHXSFDSDELOLW\\7KH+3,

SXPSVDUHDGHTXDWHO\\SURWHFWHGE\\VHSDUDWLRQIURPD+(/%LQWKH7%36:LVXVHGWRIHHGWKH

6*VGXULQJSODQWFRROGRZQ'XHWRWKHOLPLWHGVKXWGRZQFDSDELOLW\\RIWKH66)WKH5&6

LQYHQWRU\\FRQWURO5&3VHDOFRROLQJDQG6*IHHGIXQFWLRQVDUHWUDQVIHUUHGIURPWKH66)WRWKH

36:V\\VWHPSULRUWRLQLWLDWLQJDFRROGRZQ



7KHOLFHQVHHSURYLGHGDGHVFULSWLRQRIWKHVHTXHQFHIRUDFKLHYLQJ0RGH7KLVVHTXHQFH

XWLOL]HV59KHDGYHQWV$'9V36:IORZ+3,5&6SRZHURSHUDWHGUHOLHIYDOYHVDQG

SUHVVXUL]HUKHDWHUVWRVWDELOL]HWKHUHDFWRULQ0RGH,QWKLVFRQILJXUDWLRQORQJWHUPVXEFRROHG

QDWXUDOFLUFXODWLRQ'+5FRQGLWLRQVDUHPDLQWDLQHGZLWK5&6SUHVVXUHEHLQJFRQWUROOHGE\\

F\\FOLQJRIWKHSUHVVXUL]HUKHDWHUVDQG5&WHPSHUDWXUHEHLQJPDLQWDLQHG)E\\QDWXUDO

FLUFXODWLRQ



3KDVH'DPDJH$VVHVVPHQWDQG5HSDLUV5HTXLUHGWR$FKLHYH0RGH



LWKWKHSODQWLQ0RGH+(/%GDPDJHWRV\\VWHPVQHHGHGWRDOORZSODQWFRROGRZQIURP

0RGH ) WR0RGH ) ZRXOGEHUHSDLUHG$VRXWOLQHGLQWKH/$5NH\\

FRPSRQHQWVLQWKHVHTXHQFHWRDFKLHYH0RGHDUHWKH&&:V\\VWHPWKH/36:V\\VWHPWKH

/3,V\\VWHPDQGWKHDVVRFLDWHGHOHFWULFDOSRZHUWRWKHVHV\\VWHPV3RVWXODWHGORVVRI$&SRZHU

WRDOOWKUHHXQLWVZRXOGUHTXLUHUHVWRULQJSRZHUWRRQH&&:SXPSPRWRUWZR/36:SXPS

PRWRUV RQHVKDUHGE\\8QLWVDQGDQGRQHIRU8QLW WKUHH/3,SXPSPRWRUV RQHIRUHDFK

XQLW DQGWKHGHFD\\KHDWGURSOLQHLVRODWLRQYDOYHVIRUHDFKXQLW



7KHOLFHQVHHGHVFULEHGWKDWWKHDFWLRQVWKDWPD\\EHQHFHVVDU\\WRUHVWRUHSRZHUWRWKHSXPS

PRWRUVDQGYDOYHVQHHGHGIRU&6'DUHFRQWDLQHGLQWKHVLWHGDPDJHUHSDLUSURFHGXUHV7KH

QHFHVVDU\\HOHFWULFDOHTXLSPHQWKDVEHHQLGHQWLILHGLQWKHVHSURFHGXUHVDQGLVDYDLODEOHWR

HQDEOHWKHUHVWRUDWLRQRISRZHUWRWKHVHPRWRUV3RZHUWRWKHSXPSPRWRUVLVSURYLGHGE\\

9$&EUHDNHUVPRXQWHGRQDSRUWDEOHWUDLOHU3RZHUWRWKH9$&EUHDNHUWUDLOHULVSURYLGHG

E\\D.HRZHH+\\GURHOHFWULF8QLWYLDWKH&7WUDQVIRUPHU,QDGGLWLRQWZR/36:SXPSPRWRUV

ZRXOGQHHGWREHUHSODFHGLIWKH&&:SLSLQJEUHDNVDQGWKH7%IORRGV7KHOLFHQVHHVWDWHG

WKDWWZRVSDUH/36:SXPSPRWRUVDUHPDLQWDLQHGDYDLODEOHWKDWFDQEHLQVWDOOHGXVLQJH[LVWLQJ

VWDWLRQSURFHGXUHV



3KDVH3ODQW&RROGRZQWR0RGH ) 



7KHJXLGDQFHWRFRROGRZQWKHSODQWWR0RGHLVFRQWDLQHGLQVLWHRSHUDWLQJSURFHGXUHV$V

SURSRVHGE\\WKHOLFHQVHHWKH+(/%VWUDWHJ\\DOORZVUHSDLUVWREHPDGHWRDQ\\

V\\VWHPFRPSRQHQWVUHTXLUHGIRU&6'7KHOLFHQVHHVXPPDUL]HGWKHVHTXHQFHRIRSHUDWLRQVWR

DFKLHYH&6'DVIROORZV



 7KH&&:V\\VWHP/36:V\\VWHPVDQG/3,V\\VWHPVDUHORFDOO\\DOLJQHGIRURSHUDWLRQ



 2QH&&:SXPSLVVWDUWHGORFDOO\\DWWKH9$&EUHDNHUWUDLOHUWRVXSSO\\VXFWLRQWR

WKH/36:SXPSV



 7KHWZR/36:SXPSVDUHVWDUWHGORFDOO\\DWWKH9$&EUHDNHUWUDLOHUWRSURYLGH

FRROLQJZDWHUWRWKH8QLW8QLWDQG8QLW/3,FRROHUV

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











 7KHGHFD\\KHDWGURSOLQHYDOYHVDUHUHPRWHO\\RSHQHGIURPWKHSRUWDEOHYDOYHFRQWURO

SDQHO7KHDFWLRQVWDNHQWRUHVWRUHSRZHUWRWKHGURSOLQHYDOYHVLVFRQWDLQHGLQWKHVLWH

GDPDJHUHSDLUSURFHGXUHV



 2QH/3,SXPSLVVWDUWHGORFDOO\\DWWKH9$&EUHDNHUWUDLOHUIRUHDFKXQLW



 /36:IORZLVWKURWWOHGORFDOO\\WRWKH/3,FRROHUVWRHVWDEOLVKWKHGHVLUHGFRROGRZQUDWH





0DLQ)HHGZDWHU/LQH%UHDNLQWKH(DVW3HQHWUDWLRQ5RRP



7KHSRVWXODWHG0)':+(/%RFFXUVGRZQVWUHDPRIWKHFKHFNYDOYHLQWKH(35RIWKH$%7KH

536ZLOOWULSWKHUHDFWRURQKLJK5&6SUHVVXUH7KHDIIHFWHG6*ZLOOFRPSOHWHO\\GHSUHVVXUL]H

IROORZLQJUHDFWRUWULSUHVXOWLQJLQDQ$),6DFWXDWLRQWKDWWULSVWKH0)':SXPSVDQGLVRODWHV

PDLQDQGHPHUJHQF\\)':WRWKHDIIHFWHG6*7KHVWDWLRQHOHFWULFDOV\\VWHPLVQRWDIIHFWHGE\\

WKH+(/%DQGQRUPDOSODQWHTXLSPHQWLVXVHGIRUPLWLJDWLRQ7KHPRWRUGULYHQ():SXPS

DOLJQHGWRWKHLQWDFW6*ZLOOVWDUWDXWRPDWLFDOO\\RQWKHORVVRIERWK0)':SXPSVDQGWKH

WUDQVLHQWZRXOGHYROYHLQWRDQRYHUKHDWLQJVFHQDULRZLWKWKHRQHPRWRUGULYHQ():SXPS

VXSSO\\LQJWKHXQDIIHFWHG6*DQGIRXURSHUDWLQJ5&3V7KHOLFHQVHHLGHQWLILHGDQH[LVWLQJ

SURFHGXUDODFWLRQWRVHFXUHRQH5&3SHU6*DVDQHZ7&$WREHFRPSOHWHGZLWKLQPLQXWHV

RIWKHORVVRIWKH0)':SXPSV



7KLV0)':+(/%HYHQWGRZQVWUHDPRIWKHFKHFNYDOYHLVIXUWKHUGLVFXVVHGLQ6HFWLRQRI

$WWDFKPHQWWRWKH/$5,QWKHHYDOXDWLRQWKH(350)':+(/%LVDVVXPHGWRGDPDJHWKH

LQVWUXPHQWDLUKHDGHULQWKH(35UHVXOWLQJLQDORVVRIQRUPDOOHWGRZQEHFDXVHWKHYDOYHVIDLO

FORVHGRQORVVRIDLU7KHOLFHQVHHLGHQWLILHGF\\FOLQJRIWKH5&6KLJKSRLQWYHQWVIRUDOWHUQDWH

OHWGRZQWRFRQWURO5&6LQYHQWRU\\DQGSUHVVXUHDVDQHZSURFHGXUHVWHSDQG7&$WREH

FRPSOHWHGLQPLQXWHVIRUWKLVVFHQDULR7KHDQDO\\VLVUHVXOWVGHPRQVWUDWHWKDWWKHSHDN5&6

SUHVVXUHUHPDLQVEHORZWKHSVLJOLPLWDVHYDOXDWHGLQ6HFWLRQRIWKLV6(



7KHOLFHQVHHGHYHORSHGSODQVWRDGGUHVVSRVWXODWHG6$)VFHQDULRV,IDQ6$)SUHYHQWVWKH

+3,V\\VWHPIURPSURYLGLQJ5&3VHDOFRROLQJWKH66)5&08V\\VWHPLVXVHGWRSURYLGH5&3

VHDOFRROLQJDQG5&6LQYHQWRU\\FRQWURO,IDQ6$)SUHYHQWVWKH():V\\VWHPIURPVXSSO\\LQJWKH

XQDIIHFWHG6*+3,IRUFHGFRROLQJ HJ+3,IHHGDQGEOHHG LVXWLOL]HGWRSURYLGHFRUHFRROLQJ

XQWLO66)$6:IHHGLVHVWDEOLVKHGWRWKHXQDIIHFWHG6*,IDQ6$)UHVXOWVLQDIDLOXUHRIWKH

FRQWUROFRPSOH[ &5FDEOHVSUHDGLQJURRP &65 DQGHOHFWULFDOHTXLSPHQWURRP FRROLQJWKH

DIIHFWHGXQLWLVPDLQWDLQHGLQDQ66'FRQGLWLRQXVLQJWKH66)5&08V\\VWHPDQGWKH66)$6:

V\\VWHP



%DVHGRQDORFDWLRQRIWKHEUHDNGRZQVWUHDPRIWKHFKHFNYDOYHWKHQRUPDOSODQWHTXLSPHQW

DQGHOHFWULFDOV\\VWHPZLOOUHPDLQDYDLODEOHWRPLWLJDWHWKHHYHQW%DVHGRQWKHDERYHWKH15&

VWDIIILQGVLWDFFHSWDEOHWRFUHGLWWKHQRUPDOV\\VWHPVIRUPLWLJDWLRQRI0)':+(/%VLQWKH(35





2YHUFRROLQJ6FHQDULRV



7KHRYHUFRROLQJDQDO\\VLVFRQVLGHUVDIDXOWHG06OLQHZKLOHDVVXPLQJWKH0)':OLQHVUHPDLQ

LQWDFWWRPD[LPL]HWKHRYHUFRROLQJ%RWKWKHRYHUKHDWLQJDQGRYHUFRROLQJDQDO\\VHVFRQVLGHUWKH

SRVVLELOLW\\WKDWWKH+(/%FDXVHVGDPDJHWKDWPD\\UHVXOWLQWKHORVVRIRQVLWHHPHUJHQF\\SRZHU

VRXUFHV2QHREMHFWLYHRIWKHRYHUFRROLQJDQDO\\VLVLVWRGHPRQVWUDWHDGHTXDWHFRUHFRROLQJDQG

HVWDEOLVKDEDVLVIRUPLWLJDWLRQVWUDWHJLHVIRUHVWDEOLVKLQJDQGPDLQWDLQLQJ66'FRQGLWLRQV

IROORZLQJD06+(/%LQWKH7%RU(35$VHFRQGREMHFWLYHRIWKHRYHUFRROLQJDQDO\\VLVLVWR

GHPRQVWUDWHWKDWWKH6*WXEHVUHPDLQLQWDFWDQGWKDWWKH5&6UHPDLQVZLWKLQDFFHSWDEOH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











SUHVVXUHDQGWHPSHUDWXUHOLPLWV7KHVHREMHFWLYHVDUHHYDOXDWHGDVSDUWRIWKHWKHUPDO

K\\GUDXOLFDQDO\\VLVLQ6HFWLRQRIWKLV6(





0DLQ6WHDP/LQH%UHDNLQ7XUELQH%XLOGLQJ



7KHERXQGLQJVFHQDULRLVD06+(/%LQWKH7%UHVXOWLQJLQDORVVRIDOO$&SRZHUDQGUHDFWRU

WULS7KHODFNRI06LVRODWLRQYDOYHVDQGWKHSRWHQWLDOIRURQHRUPRUHWXUELQHVWHDPDGPLVVLRQ

YDOYHVWRQRWIXOO\\FORVHSHUPLWVVWHDPIURPERWK6*VWRIORZWKURXJKDVLQJOHEUHDN LHD

GRXEOH06+(/% WKDWSURGXFHVDPRUHUDSLGFRROGRZQWKDQLIVWHDPIURPRQHVWHDPJHQHUDWRU

IORZVWKURXJKWKHEUHDN7KHSRVWXODWHGGRXEOH06+(/%OHDGVWRDQRYHUFRROLQJFRQGLWLRQIRU

WKH5&67KHDIIHFWHGXQLWLVVWDELOL]HGLQ0RGHZLWK5&WHPSHUDWXUHRIDSSUR[LPDWHO\\)

WR)



0LWLJDWLRQRIWKHVHSRVWXODWHG+(/%VLVGLYLGHGLQWRIRXUGLVWLQFWSKDVHV

3KDVH5HDFWRU6KXWGRZQ

5HDFWRUVKXWGRZQDQGWKHVWDELOL]DWLRQRIWKHDIIHFWHGXQLW V LQ0RGHZLWK5&DYHUDJH

WHPSHUDWXUH)



2SHUDWRUDFWLRQVDUHQHHGHGWRUHVWRUHVHFRQGDU\\VLGHKHDWUHPRYDODQG5&3VHDOFRROLQJWR

HVWDEOLVKDQ66'FRQGLWLRQ7KH66)DQGWKH36:V\\VWHPVZRXOGUHPDLQDYDLODEOHWR

HVWDEOLVKDQGPDLQWDLQ66'IRUWKLV06+(/%



8VLQJWKH36:V\\VWHPWKH36:FRPSRQHQWV ORFDWHGZLWKLQ36:EXLOGLQJDQG$% DQG+3,

ORFDWHGLQWKHEDVHPHQWRIWKH$% SURYLGHFDSDELOLW\\IRUDFKLHYLQJ66'7KH36:LVDOLJQHG

WRWKHDIIHFWHGXQLWWRUHILOOWKH5&6UHVWRUHVKXWGRZQFRROLQJPDUJLQDQGUHFRYHUSUHVVXUL]HU

OHYHO7KH36:SRZHUHG+3,SXPSLVXWLOL]HGWRSURYLGH5&3VHDOFRROLQJ36:SRZHULV

ORFDOO\\DOLJQHGWRVHOHFWHGSUHVVXUL]HUKHDWHUVDQGWKHSUHVVXUL]HUKHDWHUVDUHF\\FOHGDV

UHTXLUHGWRFRQWURO5&6SUHVVXUH7KHXQLWZRXOGEHSODFHGLQ0RGHZLWKLQKRXUVZLWKWKH

36:



8VLQJWKHDOWHUQDWH66)WKH66)$6:DQG66)5&086\\VWHPDUHXVHGWREULQJUHDFWRUWRD

VKXWGRZQFRQGLWLRQ7KH66)'*LVHPHUJHQF\\VWDUWHGDQGDOLJQHGWRWKH66)HOHFWULFDO

V\\VWHP7KH66)5&08SXPSLVVWDUWHGWRUHVWRUH5&3VHDOFRROLQJ5&6ERXQGDU\\YDOYHV

DUHFORVHGWRLVRODWHSRWHQWLDOGLYHUVLRQIORZSDWKV7KH66)SUHVVXUL]HUKHDWHUVDUHHQHUJL]HG

WRHVWDEOLVKDQGPDLQWDLQD)VXEFRROLQJPDUJLQ



3KDVHVDQG



7KHDFWLYLWLHVUHTXLUHGWRFRROGRZQWKHSODQWWR0RGH ) SHUIRUPGDPDJHDVVHVVPHQW

DQGUHSDLUVUHTXLUHGWRDFKLHYH0RGH ) DQGFRROGRZQWKHSODQWWR0RGH ) 

DUHWKHVDPHDVWKHDFWLYLWLHVDQGUHSDLUVGHVFULEHGSUHYLRXVO\\IRUWKHRYHUKHDWLQJVFHQDULR

DERYH



/RVVRI$&SRZHUGXHWRWKH06+(/%ZLOOUHTXLUHXVHRI66)DQG36:V\\VWHPV7KH66)LV

FDSDEOHRIEULQJLQJWKHSODQWWR02'(RQO\\7KHUHIRUH36: RUDYDLODEOHQRUPDOV\\VWHP LV

UHTXLUHGWREULQJWKHSODQWWR02'(DQG02'(ZRXOGEHDFKLHYHGE\\WKHUHSDLURI$&

SRZHUDQGXVHRISODQWV\\VWHPV

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











%\\OHWWHUGDWHG6HSWHPEHUWKHOLFHQVHHSURYLGHGDUHVSRQVHWRDUHTXHVWIRU

DGGLWLRQDOLQIRUPDWLRQ 5$, DGGUHVVLQJWKHHQYLURQPHQWDODQGKDELWDELOLW\\HIIHFWVRIXQLVRODWHG

VWHDPIORZWRWKH7%7KH2FRQHHXQLWVKDYHQRPDLQVWHDPLVRODWLRQYDOYHV 06,9V EHWZHHQ

WKH6*VDQGWKHWXUELQHVWRSYDOYHV$OVRWKHOLFHQVHHGHVFULEHGFHUWDLQORFDWLRQVZKHUH

VWHDPIORZLQRQHKHDGHUFDQFURVVRYHUWRWKHRWKHUKHDGHU7KHUHIRUHVWHDPIURPHLWKHU

VWHDPJHQHUDWRUFRXOGSDVVRXWWKHEUHDNORFDWLRQXQWLOWKH5&6LVFRROHGWR0RGH

7KHOLFHQVHHGHWHUPLQHGWKDWWKHKDELWDELOLW\\DQGFDSDELOLW\\WRSHUIRUPWKHQHFHVVDU\\UHFRYHU\\

DFWLRQVZRXOGEHDFFHSWDEOHEDVHGRQWKHIROORZLQJ



x

WKHORQJWHUPQDWXUHRIWKHUHTXLUHGDFWLRQV

x

WKHVLJQLILFDQWUHGXFWLRQLQVWHDPIORZRYHUWLPHIROORZLQJWKH+(/%

x

WKHSK\\VLFDOVL]HRIWKH7%VWUXFWXUH

x

WKHRSWLRQVLIQHFHVVDU\\WRSHUIRUPLVRODWLRQRIWKHEUHDNLQVWDOOEDUULHUVUHGLUHFWVWHDP

UHOHDVHSRLQWVRUSURYLGHYHQWLODWLRQWRLPSURYH7%DFFHVV



7KH06+(/%VUHVXOWLQJLQWKHORVVRISODQWV\\VWHPVLQVLGHWKH7%DUHPLWLJDWHGE\\WKH36:

V\\VWHPZLWKWKH66)DVDEDFNXS



+DELWDELOLW\\IRURSHUDWLRQRIWKH36:V\\VWHPIURPWKH&5DQGWKH66)IURPWKH66)FRQWURO

URRPLVPDLQWDLQHGDVUHTXLUHGWRVXSSRUWWKHLU66'FDSDELOLW\\)ROORZLQJVWDELOL]DWLRQLIWKH

XQLWLVEHLQJPDLQWDLQHGIURPWKH66)UHFRYHU\\DQGWUDQVIHUWRWKH36:V\\VWHPIRUH[WHQGHG

66'ZRXOGEHSHUIRUPHG7KHOLFHQVHHQRWHGWKDWWKH15&VWDIISUHYLRXVO\\OLFHQVHGWKH36:

V\\VWHPIRUORQJWHUPFRROLQJDQGWKH36:V\\VWHPZRXOGEHXVHGWRPDLQWDLQWKHDIIHFWHGXQLWV

LQ66'7KHOLFHQVHHGHWHUPLQHGWKDWWKHORQJWHUPFDSDELOLW\\RI36:LVDGHTXDWHWRSURYLGH

DPSOHWLPHIRUGLVVLSDWLRQRIWKHLQLWLDOVWHDPUHOHDVHDVZHOODVWLPHIRUGHFD\\KHDWWRGHFUHDVH

VXFKWKDWDQ\\FRQWLQXHGVWHDPUHOHDVHLQWKHODUJHRSHQ7%VWUXFWXUHLVORFDOL]HG7KHVHORFDO

VWHDPUHOHDVHVPD\\EHPDQDJHGXVLQJLVRODWLRQRUSODFHPHQWRIEDUULHUVWRLPSURYH7%DFFHVV

7KHUHIRUHKDELWDELOLW\\FRQGLWLRQVGXHWRVWHDPUHOHDVHVZRXOGQRWEHH[SHFWHGWRSUHYHQW

DFFHVVWRWKH7%WRUHFRYHUV\\VWHPVQHHGHGWRDFKLHYH&6'



7KH15&VWDIIHYDOXDWHGWKHDFWLRQVQHFHVVDU\\WRDFKLHYHDQGPDLQWDLQ66'IROORZLQJD06

+(/%LQWKH7%7KH15&VWDIIILQGVWKDWWKH36:V\\VWHPZLWKWKH66)DVEDFNXSSURYLGH

DFFHSWDEOHPLWLJDWLRQIRUD06+(/%LQVLGHWKH7%XQWLOFRQGLWLRQVIRU&6'FDQEHVXSSRUWHG





/HWGRZQ/LQH%UHDN



7KHUHLVDSRVWXODWHGWHUPLQDOHQGEUHDNDWWKHOHWGRZQOLQHFRQWDLQPHQWSHQHWUDWLRQ

XSVWUHDPRIWKHRXWERDUGFRQWDLQPHQWLVRODWLRQYDOYHLQWKH(357KLVEUHDNGRHVQRWLQWHUDFW

ZLWKDQ\\RWKHU66'HTXLSPHQWEXWWKHGHWHFWLRQDQGLVRODWLRQRIWKHOHWGRZQOLQHLVLPSRUWDQW

EHFDXVHWKHLVRODWLRQRIWKHOHWGRZQOLQHWHUPLQDWHVWKHORVVRI5&6LQYHQWRU\\7KH+3,V\\VWHP

KDVDGHTXDWHFDSDFLW\\WRFRPSHQVDWHIRUWKHOHDNUDWHDV5&6SUHVVXUHDQGSUHVVXUL]HUOHYHO

UHFRYHU5&6UHPDLQVVXEFRROHGDQG5&3VUHPDLQLQRSHUDWLRQ



7KHOHWGRZQOLQHEUHDNUHVXOWVLQGHSUHVVXUL]DWLRQRIWKH5&6DVSULPDU\\LQYHQWRU\\LVORVW

WKURXJKWKHEUHDNDQGDUHDFWRUWULSLVLQLWLDWHGRQHLWKHUWKHORZ5&6SUHVVXUHRURQYDULDEOH

ORZSUHVVXUHWULSIXQFWLRQ&RQWLQXHG5&6GHSUHVVXUL]DWLRQUHVXOWVLQWKH5&6SUHVVXUH

GHFUHDVLQJWRWKHHQJLQHHUHGVDIHJXDUGV (6 DFWXDWLRQSRLQW7KH(6V\\VWHPDFWXDWLRQ

LVRODWHVWKHEUHDNE\\FORVLQJWKHRXWOHWYDOYHVIRUOHWGRZQFRROHUV³$'DQG³%'ZKLFKDUHWKH

SDUDOOHOLQERDUGFRQWDLQPHQWLVRODWLRQYDOYHVIRUWKHSHQHWUDWLRQ7RDGGUHVVDSRVWXODWHGVLQJOH

IDLOXUHRIHLWKHURIWKHVHYDOYHVWKHOLFHQVHHLGHQWLILHGDQHZWLPHFULWLFDORSHUDWRUDFWLRQWR

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











LVRODWHWKHFRUUHVSRQGLQJOHWGRZQFRROHULQOHWLVRODWLRQYDOYHZLWKLQPLQXWHVRI(6DFWXDWLRQ

WRVWRSWKHORVVRI5&6LQYHQWRU\\



7KHOLFHQVHHFRQFOXGHGWKDWWKH+3,V\\VWHPKDVDGHTXDWHFDSDFLW\\WRFRPSHQVDWHIRUWKHOHDN

UDWHDV5&6SUHVVXUHDQGSUHVVXUL]HUOHYHOUHFRYHU5&6VXEFRROLQJLVQRWORVWDQG5&3V

UHPDLQLQRSHUDWLRQ)ROORZLQJWKHLVRODWLRQRIWKHOHWGRZQOLQHXQLWVKXWGRZQZRXOGEH

FRQGXFWHGXVLQJWKHQRUPDOVKXWGRZQV\\VWHPVWKHUHIRUHWKH15&VWDIIILQGVWKLVDFFHSWDEOH





+LJK3UHVVXUH,QMHFWLRQ3XPS/LQH%UHDN



7KH+3,6\\VWHPKDV+(/%VSRVWXODWHGLQWKH(35WKHZHVWSHQHWUDWLRQURRP :35 DQGWKH

+3,SXPSURRPRIHDFKXQLW7KH+3,SXPSSURYLGHV5&6PDNHXSDQG5&3VHDOFRROLQJ7KH

SRVWXODWHG+3,+(/%VLQWKHVHURRPVPD\\FUHDWHDIORRGLQJKD]DUGEXWQRDGYHUVH

WHPSHUDWXUHDQGSUHVVXUHHQYLURQPHQWVDUHJHQHUDWHGGXHWRWKHORZWHPSHUDWXUH ) RI

WKHERUDWHGZDWHUVWRUDJHWDQN %:67 DQGRUWKHOHWGRZQVWRUDJHWDQN /'67 ZDWHU



 +3,+(/%VLQ(DVW3HQHWUDWLRQ5RRP



,QDGGLWLRQWRWKH5&6OHWGRZQOLQHEUHDNGHVFULEHGDERYHWKHUHDUHWKUHHDGGLWLRQDOSRVWXODWHG

+3,+(/%VLQWKH(35



 $WHUPLQDOHQGEUHDNRQWKHWUDLQµ$¶+3,OLQHDWFRQWDLQPHQWSHQHWUDWLRQ



 $WHUPLQDOHQGEUHDNRQWKH5&3VHDOLQMHFWLRQOLQHDWFRQWDLQPHQWSHQHWUDWLRQ$



 $WHUPLQDOHQGEUHDNRQWKH5&3VHDOLQMHFWLRQOLQHDWFRQWDLQPHQWSHQHWUDWLRQ%



,IDEUHDNRFFXUVRQWKHWUDLQµ$¶+3,OLQHWKHRSHUDWRUVLQWKH&5ZLOOEHDOHUWHGWRWKHEUHDNE\\

GHFUHDVLQJ/'67OHYHOGHFUHDVLQJSUHVVXUL]HUOHYHODQGORZ+3,KHDGHUGLVFKDUJHSUHVVXUH

7KHEUHDNZLOOWKHQEHLVRODWHGE\\FORVLQJ+3 5&YROXPHFRQWUROYDOYH IURPWKH&57KH

FRPSRQHQWFRROLQJ && V\\VWHPUHPDLQVDYDLODEOHDQG5&3VHDOFRROLQJZLOOQRWEHORVW,IWKH

&&V\\VWHPIDLOVGXHWRDQ6$)5&3VHDOFRROLQJZLOOEHUHVWRUHGE\\WKH66)5&08V\\VWHP,I

WKLVOHDNLVQRWLVRODWHGZLWKLQDSSUR[LPDWHO\\PLQXWHVWKHIORRGOHYHOZLOOH[FHHGWKHWRSRI

WKHFXUEDURXQGWKHIORRGRXWOHWGHYLFHDQGWKHZDWHUZLOOIORZRXWRIWKH$%WRWKHZHVW\\DUG



,IHLWKHURQHRUERWKVHDOLQMHFWLRQOLQHVEUHDNWKHRSHUDWRUVLQWKH&5ZLOOEHDOHUWHGWRWKH

EUHDNE\\5&3VHDOIORZDQQXQFLDWRUV7KHEUHDN V ZLOOWKHQEHLVRODWHGE\\FORVLQJ+3 5&3

VHDOIORZFRQWUROYDOYH IURPWKH&5,I+3IDLOVWRFORVHRSHUDWRUVFDQLVRODWHWKHEUHDNE\\

FORVLQJPDQXDOO\\RSHUDWHGYDOYHVZKLFKDUHORFDWHGRXWVLGHRIWKHEUHDNDUHD7KH&&V\\VWHP

UHPDLQVDYDLODEOHDQG5&3VHDOFRROLQJZLOOQRWEHORVW,IWKH&&V\\VWHPIDLOVGXHWRDQ6$)

5&3VHDOFRROLQJZLOOEHUHVWRUHGE\\WKH66)5&08V\\VWHPDVGHVFULEHGDERYH,IWKLVOHDNLV

QRWLVRODWHGLQDSSUR[LPDWHO\\KRXUDQGPLQXWHVWKHIORRGOHYHOZLOOH[FHHGWKHWRSRIWKH

FXUEDURXQGWKHIORRGRXWOHWGHYLFHDQGWKHZDWHUZLOOIORZRXWRIWKH$%WRWKHZHVW\\DUG



)RUWKHDERYHSRVWXODWHG+(/%VFHQDULRVVKXWGRZQWRWKH&6'FRQGLWLRQZRXOGEHSHUIRUPHG

XVLQJQRUPDOSODQWV\\VWHPVWKHUHIRUHWKH15&VWDIIILQGVWKLVDFFHSWDEOH



 +3,+(/%VLQ:HVW3HQHWUDWLRQ5RRP

7KHUHDUHWZRSRVWXODWHG+3,+(/%VLQWKH:35

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











 $WHUPLQDOHQGEUHDNRQWKH5&3VHDOLQMHFWLRQOLQHDWFRQWDLQPHQWSHQHWUDWLRQ$



 $WHUPLQDOHQGEUHDNRQWKH5&3VHDOLQMHFWLRQOLQHDWFRQWDLQPHQWSHQHWUDWLRQ%













7KHVHEUHDNVZRXOGEHLVRODWHGDVGHVFULEHGDERYHIRUWKHVHDOLQMHFWLRQOLQHEUHDNVLQWKH

(357KH&&V\\VWHPUHPDLQVDYDLODEOHDQG5&3VHDOFRROLQJZLOOQRWEHORVW,IWKH&&V\\VWHP

IDLOVGXHWRDQ6$)5&3VHDOFRROLQJZLOOEHUHVWRUHGE\\WKH66)5&08V\\VWHP,IWKLVOHDNLV

QRWLVRODWHGZLWKLQDSSUR[LPDWHO\\KRXUDQGPLQXWHVWKHIORRGOHYHOZLOOH[FHHGWKHWRSRI

WKHIORRGEDUULHUORFDWHGLQIURQWRIWKHH[LWGRRUIURPWKH:35WRWKHZHVW\\DUGDQGWKHZDWHU

ZLOOIORZRXWRIWKH$%WRWKHZHVW\\DUG

)RUWKHDERYHSRVWXODWHG+(/%VFHQDULRVVKXWGRZQWRWKH&6'FRQGLWLRQZRXOGEHSHUIRUPHG

XVLQJQRUPDOSODQWV\\VWHPVEHFDXVHWKH\\DUHXQGDPDJHGWKHUHIRUHWKH15&VWDIIILQGVWKLV

DFFHSWDEOH

 +3,+(/%VLQWKH+3,3XPS5RRP

7KH+3,SXPSSURYLGHV5&6PDNHXSDQG5&3VHDOFRROLQJ7KHSRVWXODWHGWHUPLQDOHQG

EUHDNDWWKHGLVFKDUJHQR))OHRIWKH+3,SXPSZLOOUHVXOWLQIORRGLQJRIWKH+3,SXPSURRPLIQRW

LVRODWHG7KHOLFHQVHHVSHFLILHVWKDWPLWLJDWLRQRIWKHGLVFKDUJHQR))OH+(/%RIDQRSHUDWLQJ

+3,SXPSLVDFKLHYHGE\\GLDJQRVLVDQGLVRODWLRQRIDOHDNEHIRUHGDPDJH IORRGLQJ RFFXUV

)ROORZLQJD+(/%DWWKHGLVFKDUJHQR))OHRIWKHRSHUDWLQJ+3,SXPSWKHLPPHGLDWHUHVSRQVH

LVWKHORVVRIGLVFKDUJHIORZDQGWKHDXWRVWDUWRIWKHVWDQGE\\+3,SXPSRQORZ5&3VHDOIORZ

8SRQVWDUWRIWKHVHFRQG+3,SXPSIORZLVUHVWRUHGWRWKH5&6DQGWKH5&3V7KH&5

RSHUDWRUZLOOUHFHLYHWKH+3,SXPSGLVFKDUJHSUHVVXUHORZDQQXQFLDWRUDQGWKH5&3VHDO

KHDGHUIORZORZDQQXQFLDWRUWKHVWDQGE\\+3,SXPSZLOODXWRVWDUWDQG/'67OHYHOZLOOUDSLGO\\

GHFUHDVH2QFHWKHEUHDNORFDWLRQKDVEHHQLGHQWLILHGWKHDIIHFWHG+3,SXPSZLOOEHWULSSHGE\\

WKH&5RSHUDWRU

7KHOLFHQVHHVWDWHGWKDWDQRQOLFHQVHGRSHUDWRUZRXOGWKHQLVRODWHWKHOHDNE\\FORVLQJWKH

UHPRWHRSHUDWHGPDQXDOVXFWLRQYDOYHORFDOO\\RQWKHDIIHFWHG+3,SXPS2SHUDWLRQRIWKH

LVRODWLRQYDOYHZLOOQRWUHTXLUHHQWU\\LQWRWKH+3,SXPSURRP$VLQGLFDWHGLQ$WWDFKPHQWWR

WKH/$5YDOYHV +3 +3 RQWKHLQGLYLGXDOVXFWLRQOLQHVWRWKH8QLW³$' ³%'+3,

SXPSVZLOOEHXSJUDGHGWRDOORZWKHUHPRWHRSHUDWLRQ RSHUDWHGRXWVLGHWKH+3,SXPSURRP RI

WKHVHYDOYHVZLWKLQWZRUHIXHOLQJRXWDJHVIROORZLQJLVVXDQFHRIWKH+(/%DPHQGPHQWV

7KHOLFHQVHHHYDOXDWHGWKH7&$WRLVRODWHWKHEUHDNLQ,WHPRI$WWDFKPHQWWRWKH/$5

6LQFHWKH+(/%LVGHWHFWDEOHLQWKH&5DQGDELOLW\\H[LVWVWRLVRODWHZLWKRXWHQWU\\LQWRWKH

LPSDFWHGURRPLWLVH[SHFWHGWKDWWKHSODQWFDQPLWLJDWHWKLV+(/%WRDYRLGIORRGLQJRIWKH+3,

URRP7KHOLFHQVHHVSHFLILHVWKDWLVRODWLRQRIWKH+3,SXPSGLVFKDUJHSLSLQJEUHDNZLWKLQ

PLQXWHVLVUHTXLUHGWRSUHYHQWIORRGLQJRIWKH+3,SXPSV7KHOLFHQVHHLQGLFDWHVYDOLGDWLRQRI

WKLV7&$ZLOOEHFRPSOHWHGGXULQJLPSOHPHQWDWLRQDQGLQFOXGHVWKHYDOLGDWLRQDVDFRQIRUPLQJ

DFWLRQLQ$WWDFKPHQWWRWKHVXEPLWWDOGDWHG$XJXVW7KHOLFHQVHHIXUWKHULQGLFDWHG

VSHFLILFJXLGDQFHWRLVRODWHD+(/%RQWKHGLVFKDUJHQR))OHRIDQ+3,SXPSZLOOEH

LQFRUSRUDWHGLQWRWKHORVVRI+3,PDNHXSDQG5&3VHDOLQMHFWLRQSURFHGXUH7KH15&VWDII¶V

HYDOXDWLRQRIWKH7&$VLVLQ6HFWLRQRIWKLV6(





,GHQWLILFDWLRQRIWKH7DUJHWVRI(DFK3RVWXODWHG+(/%



7RHVWDEOLVKWKHOLVWRIWDUJHWVIRUSRVWXODWHG+(/%VWKHOLFHQVHHGHWHUPLQHG66&VUHTXLUHGWR

PLWLJDWHWKHFRQVHTXHQFHVRIWKHSRVWXODWHG+(/%VDQGVDIHO\\EULQJWKHXQLWWRD&6'

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











FRQGLWLRQ7KLVOLVWRI66&VFDQEHGHWHUPLQHGE\\HVWDEOLVKLQJWKHVKXWGRZQVHTXHQFHIRU

2FRQHH,Q$WWDFKPHQWWRWKHVXEPLWWDOGDWHG$XJXVWWKHOLFHQVHHSUHVHQWHGWKH

IROORZLQJFULWHULDXVHGWRLGHQWLI\\WKHHTXLSPHQWQHFHVVDU\\IRU+(/%PLWLJDWLRQDQGVXSSRUWLQJD

SDWKZD\\WR&6'IRUDJLYHQSRVWXODWHG+(/%



x

(TXLSPHQWXVHGWRPLWLJDWHSRVWXODWHG+(/%VLQFOXGHVWKRVHV\\VWHPV

DQGFRPSRQHQWVWKDWDUHXVHGIRUGHWHFWLRQDQGLVRODWLRQRIVSHFLILHG

+(/%V(TXLSPHQWWKDWLVXVHGIRUWKHGHWHFWLRQDQGLVRODWLRQIRUDQ

LGHQWLILHG+(/%LVWKHRQO\\GHWHFWLRQDQGLVRODWLRQHTXLSPHQWUHTXLUHGWR

EHWDUJHWVRIWKDWVSHFLILF+(/%



x

(TXLSPHQWXVHGWRPHHWDQ\\RIWKHIROORZLQJVKXWGRZQREMHFWLYHVDUH

FRQVLGHUHGDWDUJHWRISRVWXODWHG+(/%V



o 5HDFWLYLW\\&RQWURO

o 5&6,QYHQWRU\\&RQWURO

o 5&63UHVVXUH&RQWURO

o 5&6+HDW5HPRYDO&RQWURO

o 5% %RXQGDU\\ ,QWHJULW\\

o &5+DELWDELOLW\\ ORQJWHUP 

o 3ODQW&RROGRZQ

x

%RWKSULPDU\\DQGEDFNXSV\\VWHPVXVHGWRDFKLHYHWKHVKXWGRZQ

REMHFWLYHVGHVFULEHGDERYHDUHLQFOXGHGDVVKXWGRZQHTXLSPHQWDQG

WDUJHWVRIWKHSRVWXODWHG+(/%V



x

3LSLQJRULILFHVUHOLHIYDOYHVDQGFKHFNYDOYHVDUHFRQVLGHUHGSDVVLYH

W\\SHFRPSRQHQWVLQWKDWWKH\\GRQRWUHTXLUHDQH[WHUQDOSRZHUVRXUFHRU

PDQXDODFWLRQWRSHUIRUPWKHLULQWHQGHGIXQFWLRQDQGWKHVHFRPSRQHQWV

SHUIRUPWKHLUIXQFWLRQUHJDUGOHVVRIWKHHQYLURQPHQWDOFRQGLWLRQV7KHVH

FRPSRQHQWVDUHQRWLGHQWLILHGDVUHTXLUHGLQWKHVKXWGRZQVHTXHQFH

EHFDXVHWKH\\DUHQRWVXEMHFWWR6$)V7KH\\DUHKRZHYHU+(/%WDUJHWV



x

$6$)LVSRVWXODWHGLQV\\VWHPVXVHGWRPLWLJDWHWKHFRQVHTXHQFHVRIWKH

SRVWXODWHGEUHDNVDQGFULWLFDOFUDFNVRUWKRVHV\\VWHPVXVHGWRDFKLHYHD

VKXWGRZQREMHFWLYHRIWKHXQLW7KHVLQJOHDFWLYHFRPSRQHQWIDLOXUHLVDVVXPHG

WRRFFXULQDGGLWLRQWRWKRVHFRPSRQHQWVGDPDJHGE\\WKHSRVWXODWHGSLSHEUHDN



x

1R6$)VDUHSRVWXODWHGGXULQJWKH³3ODQW&RROGRZQ'SKDVHDQGWKH³3ODQW

&RROGRZQWRWKH&6'&RQGLWLRQ'SKDVH



x

$OODYDLODEOHV\\VWHPVLQFOXGLQJWKRVHDFWXDWHGE\\RSHUDWRUDFWLRQVPD\\EH

HPSOR\\HGWRPLWLJDWHWKHFRQVHTXHQFHVRIDSRVWXODWHG+(/%RUFULWLFDOFUDFN



x

,QGHWHUPLQLQJWKHV\\VWHPVDQGFRPSRQHQWVDYDLODEOHWRPLWLJDWHWKH

FRQVHTXHQFHVRISRVWXODWHG+(/%VDOOVKXWGRZQHTXLSPHQWLVDVVXPHGWREH

RSHUDEOHDQGDYDLODEOHDWWKHVWDUWRIWKHSRVWXODWHG+(/%VHTXHQFH,WLVQRW

QHFHVVDU\\WRSRVWXODWHWKDWDQ\\V\\VWHPVRUFRPSRQHQWVDUHRXWRIVHUYLFHIRU

PDLQWHQDQFH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











x

$OWKRXJKDSRVWXODWHG+(/%RXWVLGHRIWKHFRQWDLQPHQWEXLOGLQJPD\\XOWLPDWHO\\

UHTXLUHD&6'KROGLQJDW+RW6WDQGE\\LVDOORZHGLQRUGHUWRDOORZSODQW

SHUVRQQHOWRDVVHVVWKHVLWXDWLRQDQGPDNHDQ\\QHFHVVDU\\UHSDLUVWRDOORZWKH

XQLWWRUHDFK&6'



7KH15&VWDIIHYDOXDWHGWKHVHFULWHULDDJDLQVWWKHJXLGDQFHLQWKH*LDPEXVVR6FKZHQFHU

OHWWHUVDQGWKHOLFHQVLQJEDVLVHVWDEOLVKHGLQWKHOLFHQVHH¶VRULJLQDOUHVSRQVH7KH15&VWDII

FRQILUPHGWKDWWKHFULWHULDGHILQHGLQWKHILUVWILYHEXOOHWVDERYHDUHFRQVLVWHQWZLWKWKHJXLGDQFH

LQWKH*LDPEXVVR6FKZHQFHUOHWWHUV,QDGGLWLRQWKHXVHRIDOODYDLODEOHV\\VWHPVLQFOXGLQJ

WKRVHDFWXDWHGE\\RSHUDWRUDFWLRQVWRPLWLJDWHWKHHIIHFWVRIDSRVWXODWHG+(/%LVDFULWHULRQ

FRQVLVWHQWZLWKWKHH[LVWLQJOLFHQVLQJEDVLVDQGGRHVQRWUHSUHVHQWDOLFHQVLQJEDVLVFKDQJH

+RZHYHUWKH15&VWDIIUHYLHZVHDFKWLPHFULWLFDORSHUDWRUDFWLRQWRHQVXUHWKDWWKHFRPSOHWLRQ

RIWKHDFWLRQLQWKHVSHFLILHGWLPHLVUHDVRQDEO\\DVVXUHGDVGHVFULEHGLQ6HFWLRQRIWKLV6(

7KHH[FOXVLRQRIVLQJOHIDLOXUHVGXULQJWKH³3ODQW&RROGRZQ'DQGWKH³3ODQW&RROGRZQWR&ROG

6KXWGRZQ'SKDVHVLVFRQVLVWHQWZLWKWKHSUHFHGHQWHVWDEOLVKHGIRURWKHUSODQWVOLFHQVHGWRWKH

  • LDPEXVVR6FKZHQFHUOHWWHUVFULWHULDZKHUHWKHVLQJOHIDLOXUHFULWHULDLVRQO\\DSSOLHGWR+RW

6KXWGRZQV\\VWHPVEHFDXVHFRROGRZQV\\VWHPVIRUSODQWVRIWKDWYLQWDJHZHUHQRWOLFHQVHGIRU

UHGXQGDQWFRROGRZQFDSDELOLWLHVDQG+RW6KXWGRZQSURYLGHVUHDVRQDEOHDVVXUDQFHWKDWSXEOLF

KHDOWKDQGVDIHW\\ZRXOGEHDGHTXDWHO\\SURWHFWHG





'HWHUPLQDWLRQRIWKH6KXWGRZQ(TXLSPHQW8QGDPDJHGE\\WKH3RVWXODWHG+(/%



7KHOLFHQVHHHYDOXDWHGWKHERXQGLQJGDPDJHVWDWHVIRUSRVWXODWHG+(/%VDQGGHVFULEHGWKH

OLPLWLQJFRQGLWLRQVIRUWKH+(/%VFHQDULRVLQ6HFWLRQRIWKH(QFORVXUHWRWKH/$57KH

OLFHQVHHSURYLGHGWKHIROORZLQJGHVFULSWLRQRIWKHDQDO\\VLVWRGHWHUPLQHWKHHTXLSPHQWDIIHFWHG

E\\WKHSRVWXODWHG+(/%V



$OORIWKHSRVWXODWHG+(/%VRXWVLGHRIWKHFRQWDLQPHQWEXLOGLQJDUHGHVFULEHGLQ

FDOFXODWLRQHQWLWOHG³$QDO\\VLVRI3RVWXODWHG+(/%V2XWVLGHRI&RQWDLQPHQW'



+(/%PLWLJDWLRQLVGHSHQGHQWRQWKHORFDWLRQDQGPDJQLWXGHRIWKH+(/%DVZHOO

DVLWVLQWHUDFWLRQVZLWK66'HTXLSPHQW7KHFRQVHTXHQFHVRIWKH+(/%

LQWHUDFWLRQVZHUHUHYLHZHGWRGHWHUPLQHLIRQH+(/%FRXOGEHIRXQGWKDWZDV

ERXQGLQJZLWKUHVSHFWWRRSHUDWRUDFWLRQVQHFHVVDU\\UHSDLUVPDQSRZHU

UHTXLUHPHQWVDQGWKHDVVRFLDWHGWLPHOLPLWVIRUSHUIRUPLQJWKHVHDFWLRQV,WZDV

IRXQGWKDW+(/%VRFFXUULQJLQVLGHWKH7%KDYHWKHSRWHQWLDOWRFUHDWHWKHPRVW

ERXQGLQJVFHQDULRLQYROYLQJUHTXLUHGRSHUDWRUDFWLRQVPDQSRZHUUHTXLUHPHQWV

DQGGDPDJHUHSDLUV



7KHOLFHQVHHGHVFULEHGWKHEDVLF+(/%PLWLJDWLRQVWUDWHJ\\LQWKHSURSRVHGQHZ

6HFWLRQ³+(/%0LWLJDWLRQ6WUDWHJ\\'RIWKH2168)6$5ZKLFKWKHOLFHQVHHSURYLGHG

LQ$WWDFKPHQWWRWKHVXEPLWWDOGDWHG$XJXVW7KHOLFHQVHHLGHQWLILHGWKHIROORZLQJ

PDMRUSRLQWVRIWKHVWUDWHJ\\



x

5HTXLUHG66&VORFDWHGLQWKH7%DUHQRWLPSDFWHGE\\+(/%VSRVWXODWHGWRRFFXULQWKH

$%RUWKH\\DUG

x

5HTXLUHG66&VORFDWHGLQWKH$%DUHQRWLPSDFWHGE\\+(/%VSRVWXODWHGWRRFFXULQWKH

7%

x

6$)VDUHLPSRVHGIRUWKRVHFRPSRQHQWVUHTXLUHGIRULQLWLDOPLWLJDWLRQ

x

6$)VDUHQRWLPSRVHGIRUWKRVHFRPSRQHQWVUHTXLUHGWRLQLWLDWHDFRROGRZQRIWKHSODQW

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











x

+(/%VUHVXOWLQJLQWKHORVVRISODQWV\\VWHPVLQVLGHWKH7%QHHGHGIRU66'DUHPLWLJDWHG

E\\WKH36:V\\VWHP

x

6KRXOGWKH36:V\\VWHPEHXQDYDLODEOHWKH66)LVFUHGLWHGDVDQDOWHUQDWHPHDQVRI

DFKLHYLQJDQGPDLQWDLQLQJ66'IROORZLQJ+(/%VWKDWGLVDEOHSODQWV\\VWHPVLQVLGHWKH

7%

x

+(/%VUHVXOWLQJLQWKHORVVRISODQWV\\VWHPVLQVLGHWKH$%QHHGHGIRU66'DUHPLWLJDWHG

E\\QRUPDOSODQWV\\VWHPVRUWKH66)



)RUSRVWXODWHG+(/%VZLWKLQWKH7%WKHOLFHQVHHUHOLHGRQV\\VWHPVVHSDUDWHGIURPWKH7%IRU

WKHLQLWLDOPLWLJDWLRQWRVWDELOL]HDQGPDLQWDLQWKHSODQWLQ+RW6KXWGRZQ7KHOLFHQVHHLGHQWLILHG

WKH36:V\\VWHPDQGWKH66)DVWKHSULPDU\\DQGEDFNXSV\\VWHPVIRUD7%+(/%WKHUHE\\

DFFRPPRGDWLQJDQ6$))RUSODQWV\\VWHPVQHHGHGWRFRROGRZQDQGSODFHWKHSODQWLQ&ROG

6KXWGRZQWKHOLFHQVHHSURSRVHGWRUHSDLURUUHSODFHGDPDJHGFRPSRQHQWVLQWKH7%LI

QHFHVVDU\\)RUSRVWXODWHG+(/%VLQWKH$%WKHOLFHQVHHUHOLHGRQVHSDUDWLRQRUSURWHFWLRQRI

FHUWDLQ66&VIURP+(/%HIIHFWV





'LUHFW(IIHFWVIURP3LSH:KLSDQG-HW,PSLQJHPHQW



7KHOLFHQVHHGHVFULEHGWKHSURFHVVWRHYDOXDWHWKHGLUHFWSLSHZKLSDQGMHWLPSLQJHPHQWHIIHFWV

RISRVWXODWHG+(/%VRQHTXLSPHQWLQ$WWDFKPHQWWRWKH/$57KHOLFHQVHHVWDWHGWKDW

H[FHSWIRUWKH0)':SLSHUXSWXUHUHVWUDLQWVORFDWHGDWWKHWZR0)':FRQWDLQPHQWSHQHWUDWLRQV

LQHDFKXQLW¶V(35WKHHYDOXDWLRQVDVVXPHGXQUHVWUDLQHGOLQHV)RUHDFKXQUHVWUDLQHGOLQHWKH

OLFHQVHHGHWHUPLQHG=R,EDVHGRQMHWLPSLQJHPHQWORDGVDQGUHVXOWLQJSLSHZKLS7KHOLFHQVHH

SHUIRUPHGVXUYH\\VRIHDFKRIWKHVHEUHDNORFDWLRQVWRLGHQWLI\\66'HTXLSPHQWZLWKLQWKH=R,

7KHOLFHQVHHFRQVLGHUHGDQ\\66'HTXLSPHQWORFDWHGZLWKLQWKH=R,DVGDPDJHGDQGQRQ

IXQFWLRQDO7KHUHIRUHH[FHSWIRUWKH0)':EUHDNDWWKHFRQWDLQPHQWSHQHWUDWLRQLQWKH(35

WKHOLFHQVHHUHOLHGRQ66&VUHPRWHIURPWKHEUHDNORFDWLRQIRU+(/%PLWLJDWLRQWRDFKLHYHDQG

PDLQWDLQ+RW6KXWGRZQFRQGLWLRQV7KH0)':SLSHUXSWXUHUHVWUDLQWVKDYHEHHQLQFOXGHGLQ

WKH+(/%OLFHQVLQJEDVLVDQGWKHOLFHQVHHGLGQRWSURSRVHDFKDQJHWRWKHLUIXQFWLRQRUGHVLJQ



7KHOLFHQVHHGHWHUPLQHGWKDW06DQG0)':+(/%VLQWKH7%KDYHWKHSRWHQWLDOWRGLUHFWO\\

FDXVHGDPDJHWRHTXLSPHQWWKDWSURYLGHVHVVHQWLDOVXSSRUWIXQFWLRQVIRUQRUPDOSODQWV\\VWHPV

HTXLSPHQWQHFHVVDU\\WRSODFHDSODQWLQ&ROG6KXWGRZQDQGVWUXFWXUDOFRPSRQHQWVRIWKH7%

7KHHVVHQWLDOVXSSRUWHTXLSPHQWLQFOXGHVWKHVZLWFKJHDUDQGHOHFWULFDOFDEOHVLQWKH7%DQG

WKHOLFHQVHHFKDUDFWHUL]HGWKHHIIHFWRIWKHGDPDJHDVHTXLYDOHQWWRDQ6%2$FFRUGLQJO\\WKH

OLFHQVHHSURSRVHGWRSODFHWKHDIIHFWHGXQLWVLQ+RW6WDQGE\\XVLQJWKH36:V\\VWHPZKLFKLV

VXSSRUWHGE\\DVHSDUDWHHOHFWULFDOGLVWULEXWLRQV\\VWHPDQGLQFOXGHVQRFRPSRQHQWVORFDWHGLQ

WKH7%,IWKH36:V\\VWHPLVXQDYDLODEOHWKH66)SURYLGHVDUHGXQGDQWFDSDELOLW\\ERWK

LQGHSHQGHQWRIWKHQRUPDOHOHFWULFDOGLVWULEXWLRQV\\VWHPDQGORFDWHGRXWVLGHWKH7%WRSODFHWKH

DIIHFWHGXQLWVLQ+RW6WDQGE\\ZLWKRXWUHOLDQFHRQHTXLSPHQWORFDWHGLQWKH7%7RDGGUHVVWKH

SRWHQWLDOIRUGDPDJHWRV\\VWHPVDQGFRPSRQHQWVQHFHVVDU\\WRSODFHDIIHFWHGXQLWVLQ&6'WKH

OLFHQVHHSURSRVHGVWDJLQJHTXLSPHQWDQGGHYHORSLQJSURFHGXUHVWRSURPSWO\\UHSDLUWKH/36:

V\\VWHPDQGVXSSRUWLQJHOHFWULFDOVZLWFKJHDU,QDGGLWLRQWKHOLFHQVHHGHWHUPLQHGWKDWFHUWDLQ

OLQHEUHDNVFRXOGFDXVHGDPDJHWRVWUXFWXUDOFROXPQVLQWKH7%WKDWKDVWKHSRWHQWLDOWRIDLOWKH

FROXPQV7KHOLFHQVHHSURSRVHGLPSOHPHQWDWLRQRIPRGLILFDWLRQVWRSUHYHQWWKHSRWHQWLDOIDLOXUH

RIWKH7%VWUXFWXUDOFROXPQVWRZLWKVWDQGSRVWXODWHGSLSHZKLSORDGVWKUHHUHIXHOLQJRXWDJHV

DIWHULVVXDQFHRIWKH+(/%OLFHQVHDPHQGPHQWVDVRXWOLQHGLQ$WWDFKPHQWWRWKH/$5



7KHOLFHQVHHLGHQWLILHGDQXPEHURISRVWXODWHG+(/%VZLWKLQWKH$%)RUHDFKXQLWWKHOLFHQVHH

LGHQWLILHGWKHIROORZLQJ$%+(/%VDVOLPLWLQJZLWKUHVSHFWWRPLWLJDWLRQDFWLRQV

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











x

7ZR0)':WHUPLQDOHQGEUHDNORFDWLRQVRQHDWHDFKFRQWDLQPHQWSHQHWUDWLRQLQWKH

(35GRZQVWUHDPRIWKHFKHFNYDOYHZLWKSLSHZKLSUHVWUDLQWDQGJXDUGSLSHWRSUHYHQW

GLUHFWLQWHUDFWLRQ

x

2QH06WHUPLQDOHQGEUHDNDWWKH(35FRQWDLQPHQWSHQHWUDWLRQGHWHUPLQHGQRWWR

GLUHFWO\\LQWHUDFWZLWK66'V\\VWHPV

x

$OHWGRZQOLQHWHUPLQDOHQGEUHDNDWWKH(35FRQWDLQPHQWSHQHWUDWLRQGHWHUPLQHGQRWWR

GLUHFWO\\LQWHUDFWZLWK66'V\\VWHPV

x

2QH+3,LQMHFWLRQOLQHWHUPLQDOHQGEUHDNLQWKH(35GHWHUPLQHGQRWWRLQWHUDFWZLWK

RWKHU66'V\\VWHPV

x

$Q+3,SXPSGLVFKDUJHOLQHWHUPLQDOHQGEUHDNDWWKHGLVFKDUJHQR))OHRIWKH$RU%

+3,SXPSVGHWHUPLQHGQRWWRLQWHUDFWZLWK66'V\\VWHPV

x

)RXU5&3VHDOLQMHFWLRQOLQHWHUPLQDOHQGEUHDNVDWWKHFRQWDLQPHQWSHQHWUDWLRQ LHWZR

5&3VHDOLQMHFWLRQOLQHVLQWKH(35DQGWZR5&3VHDOLQMHFWLRQOLQHVLQWKH:35 

GHWHUPLQHGQRWWRGLUHFWO\\LQWHUDFWZLWK66'V\\VWHPV



7KH15&VWDIIUHYLHZHGWKHDQDO\\VLVRIWKHSURWHFWLRQDJDLQVWGLUHFWHIIHFWVIRUWKH7%DQG$%

+(/%LGHQWLILHGORFDWLRQVDVVSHFLILHGLQ,WHPVDQGRIWKH*LDPEXVVR6FKZHQFHUOHWWHUV

7KLVLQFOXGHGDUHYLHZRIOLFHQVHHGRFXPHQWVYLDDQDXGLWSURFHVVDVGRFXPHQWHGLQWKH

UHJXODWRU\\DXGLWSODQDQGVXPPDU\\ 5HIHUHQFH 7KURXJKDVDPSOLQJRIGRFXPHQWVWKH

15&VWDIIYHULILHGWKDWWKHOLFHQVHHKDGSHUIRUPHGVXUYH\\VRIWKHSK\\VLFDOORFDWLRQRISRVWXODWHG

+(/%VWRDVVHVVWKHHIIHFWVRIWKHSRVWXODWHGEUHDNV7KHOLFHQVHHIRXQGWKDWPDQ\\DQDO\\]HG

EUHDNORFDWLRQVGLGQRWLPSDFWDQ\\66'IXQFWLRQZKLOHRWKHUEUHDNORFDWLRQVZHUHGHWHUPLQHGWR

LPSDFWIXQFWLRQVUHTXLUHGIRU66'RIWKHSODQWUHTXLULQJIXUWKHUDQDO\\VLV7KHVHLQWHUDFWLRQV

ZHUHDQDO\\]HGIXUWKHUWRDVVHVVWKHLPSDFWHGIXQFWLRQVLQGHWDLODQGHQVXUHWKDW&ROG6KXWGRZQ

LVDFKLHYDEOH:LWKWKLVDGGLWLRQDODQDO\\VLVWKHOLFHQVHHDOVRGHILQHG66'HTXLSPHQWDQG

RSHUDWRUDFWLRQVWKDWDUHQHFHVVDU\\WRPLWLJDWHWKHHYHQWVWDELOL]HWKH5&6LQ+RW6WDQGE\\DQG

SHUIRUP5&6FRROGRZQ



7XUELQH%XLOGLQJ+(/%V



7KHOLFHQVHHGHVFULEHGDSURWHFWLRQVWUDWHJ\\IRU+(/%VLQWKH7%WKDWUHOLHVRQWKH36:V\\VWHP

RULIWKH36:V\\VWHPLVXQDYDLODEOHWKH66)IRULQLWLDOPLWLJDWLRQRIWKH+(/%7KH15&VWDII

HYDOXDWHGWKHVHSDUDWLRQSURYLGHGIRUWKH36:V\\VWHPDQGWKH66)XVLQJSODQWDUUDQJHPHQW

GUDZLQJVDQGWKHGHVFULSWLRQVRIWKH36:V\\VWHPDQGWKH66)7KH15&VWDIIFRQFOXGHGWKDW

WKHORFDWLRQRI36:V\\VWHPDQG66)FRPSRQHQWVDUHVHSDUDWHGDGHTXDWHO\\DQGSURYLGH

UHGXQGDQWFDSDELOLW\\WRSHUPLWRSHUDWRUVWRSODFHWKHSODQWLQWKH+RW6WDQGE\\FRQGLWLRQ7KH

OLPLWLQJFRQGLWLRQVIRURSHUDWLRQRIWKH36:V\\VWHPDQGWKH66)DUHVSHFLILHGLQHDFKRIWKH

2FRQHHXQLW¶V7HFKQLFDO6SHFLILFDWLRQV 76V DV76³3URWHFWHG6HUYLFH:DWHU 36: 

6\\VWHP'DQG76³6WDQGE\\6KXWGRZQ)DFLOLW\\ 66) 'DQGSURYLGHUHDVRQDEOHDVVXUDQFH

WKDWWKHVHV\\VWHPVZRXOGEHDYDLODEOHIRUPLWLJDWLRQRID+(/%DVFRQVLGHUHGLQWKHOLFHQVHH¶V

DQDO\\VLV7KH15&VWDIIILQGVWKDWWKHSK\\VLFDOVHSDUDWLRQRIWKH36:V\\VWHPDQGWKH66)

SURYLGHVDFFHSWDEOHSURWHFWLRQDJDLQVWSLSHZKLSDQGMHWLPSLQJHPHQWIRU+(/%VZLWKLQWKH7%

WKHUHE\\VDWLVI\\LQJ,WHPRIWKH*LDPEXVVR6FKZHQFHUOHWWHUV



7KH15&VWDIIDOVRFRQVLGHUHGSURWHFWLRQIURPGLUHFWHIIHFWVIRUHVVHQWLDO66'V\\VWHPVXVHGIRU

SODFLQJWKHDIIHFWHGXQLW V LQ&6'7KHVHV\\VWHPVSURYLGHIRUORQJWHUPPLWLJDWLRQRI+(/%V

ZLWKLQWKH7%7KHOLFHQVHH¶VSURSRVHGVWUDWHJ\\SHUPLWVUHSDLURI66&VQHFHVVDU\\WRSODFHWKH

SODQWLQ&6'DQGFRQVHTXHQWO\\H[FOXGHVFRQVLGHUDWLRQRIVLQJOHIDLOXUHVDIIHFWLQJWKRVH66&V

7KHOLFHQVHHGHWHUPLQHGWKDWWKHGLUHFWHIIHFWVRI+(/%VLQWKH7%FRXOGGDPDJHFHUWDLQ

VWUXFWXUDOVXSSRUWFROXPQVHOHFWULFDOFDEOHVHOHFWULFDOVZLWFKJHDUDQGVHUYLFHZDWHUDQG&&:

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











SLSLQJ:LWKUHVSHFWWR66'IXQFWLRQVWKHVHGDPDJHFRQGLWLRQVKDYHWKHSRWHQWLDOWRGLUHFWO\\RU

LQGLUHFWO\\DIIHFWWKHDYDLODELOLW\\WRXVHWKH/36:V\\VWHPORFDWHGLQWKH7%DQGHOHFWULFDOSRZHU

IRUD&&:SXPSDQG/3,V\\VWHPFRPSRQHQWVWRSURYLGHVXEFRROHGGHFD\\KHDWUHPRYDOWR

SODFHDQGPDLQWDLQWKHXQLWVLQ&6'



7KHOLFHQVHHDGGUHVVHGWKHGDPDJHVWDWHVDVVRFLDWHGZLWK7%+(/%V,Q$WWDFKPHQWWRWKH

VXEPLWWDOGDWHG$XJXVWWKHOLFHQVHHOLVWHGFRQIRUPLQJDFWLRQVDVVRFLDWHGZLWKWKH

SURSRVHG+(/%OLFHQVLQJEDVLVDPHQGPHQW7KHVHDFWLRQVLQFOXGHPRGLILFDWLRQVWRVHYHUDO7%

VWUXFWXUDOFROXPQVWRSUHYHQWSRWHQWLDOFROXPQIDLOXUHZKHQH[SRVHGWRWKHGHVLJQSLSHZKLS

ORDG7KHOLVWRIFRQIRUPLQJDFWLRQVLQWKH7%DOVRLQFOXGHVPRGLILFDWLRQVWRHQVXUHWKDW

QHFHVVDU\\/36:V\\VWHPLVRODWLRQVFDQEHPDGHWRHQDEOHRSHUDWLRQRIWKHDOWHUQDWHUHDFWRU

EXLOGLQJFRROLQJV\\VWHPFRQVLGHULQJWKHSRWHQWLDOIRUGLUHFW+(/%GDPDJHWRVHYHUDO/36:

V\\VWHPYDOYHV7KHOLFHQVHHDOVRSURSRVHGDFRQIRUPLQJFKDQJHWRHOLPLQDWHFURVV

FRQQHFWLRQVEHWZHHQXQLWVIRUWKH&5'V\\VWHPWRHQVXUHWKDWDORVVRISRZHUWRWKHXQLWUHVXOWV

LQDQLPPHGLDWHWULSRIWKHDIIHFWHGXQLWE\\HQVXULQJDQLPPHGLDWHORVVRISRZHUWRWKH&5'V

7RHQVXUHWKDWWKHVHPRGLILFDWLRQVDUHFRPSOHWHGSULRUWRLPSOHPHQWLQJWKHUHYLVHG+(/%

PLWLJDWLRQWKHOLFHQVHHSURSRVHGWRXSGDWHWKH8)6$5E\\VWDWLQJWKDWWKHUHYLVHG+(/%

PLWLJDWLRQVWUDWHJ\\ZLOOEHLPSOHPHQWHGRQFHWKHFRQIRUPLQJDFWLRQVRI$WWDFKPHQWWRWKH

VXEPLWWDOGDWHG$XJXVWDUHFRPSOHWHGIRUHDFKXQLW



7KH15&VWDIIUHTXHVWHGDGGLWLRQDOLQIRUPDWLRQUHJDUGLQJWKHSRWHQWLDOIRUGDPDJHWRWKH&&:

DQG/36:V\\VWHPVIURP0)':+(/%VLQWKH7%DQGWKHFRQVHTXHQWLDOLQGLUHFWHIIHFWRI7%

EDVHPHQWIORRGLQJWKDWFRXOGUHVXOWIURPWKDWGDPDJH7KHOLFHQVHHDGGUHVVHGWKLVLQLWV

UHVSRQVHWR5$,E\\OHWWHUGDWHG6HSWHPEHU 5HIHUHQFH 7KHOLFHQVHHLGHQWLILHG

VHYHUDOORFDWLRQVLQWKH7%ZKHUHGLUHFWHIIHFWVRID+(/%FRXOGFDXVHGDPDJHWRVHUYLFHZDWHU

DQG&&:SLSLQJLQWKH7%+RZHYHUWKHOLFHQVHHH[SODLQHGWKDWWKHUDWHVRIOHDNDJH

DGGLWLRQDOZDWHUUHPRYDOFDSDELOLW\\UHVXOWLQJIURPLQVWDOODWLRQRIDODUJHGUDLQIURPWKHWXUELQH

EXLOGLQJEDVHPHQWDQGLPSURYHGIORRGSURWHFWLRQEHWZHHQWKH7%DQG$%ZRXOGSHUPLW

VXEVWDQWLDOWLPHWRUHGXFHWKHUDWHRILQOHDNDJHDQGPDNHUHSDLUV7KHDYDLODEOHWLPHIRU+(/%

RSHUDWRUUHVSRQVHH[FHHGHGSUHYLRXV7&$VWRUHGXFHIORZIURP&&:QRQ+(/%IORRGLQJ

VRXUFHVDVDUHVXOWRIWKHLPSURYHGGUDLQFDSDFLW\\,QDGGLWLRQWKH36:V\\VWHPEDFNHGXSE\\

WKH66)SURYLGHVDGHTXDWHFDSDELOLW\\WRPDLQWDLQWKHSODQWLQ+RW6KXWGRZQIRUDSHULRG

DGHTXDWHWRLPSOHPHQWUHSDLUVWRLVRODWHWKHOHDNDQGSUHSDUHIRUFRROGRZQWR&6'7KHUHIRUH

WKH15&VWDIIFRQFOXGHVWKDWSURWHFWLRQIURPWKHGLUHFWHIIHFWVRI+(/%VRQWKH/36:DQG

&&:V\\VWHPVLVDFFHSWDEOHDQGFRQVLVWHQWZLWK,WHPRIWKH*LDPEXVVR6FKZHQFHUOHWWHUV



$X[LOLDU\\%XLOGLQJ+(/%V



7KHOLFHQVHHGHVFULEHGDSURWHFWLRQVWUDWHJ\\IRU+(/%VLQWKH$%WKDWUHOLHVRQQRUPDOSODQW

V\\VWHPVRULIQRUPDOSODQWV\\VWHPVDUHXQDYDLODEOHWKH66)IRULQLWLDOPLWLJDWLRQRIWKH+(/%

7KH(35RIWKH$%FRQWDLQVWKHFRQWDLQPHQWSHQHWUDWLRQVIRUSLSLQJV\\VWHPVWKDWSURYLGH)':

WRWKH6*V LQFOXGLQJ0)':():36:DQG66))': +3,WRVRPH5&3VHDOVDQGRWKHU

IXQFWLRQVQHFHVVDU\\IRUQRUPDORSHUDWLRQDFFLGHQWPLWLJDWLRQRU66'7KH:35RIWKH$%

FRQWDLQVWKHFRQWDLQPHQWSHQHWUDWLRQVIRUSLSLQJV\\VWHPVWKDWSURYLGH+3,WRWKHUHPDLQLQJ

5&3VDQGRWKHUIXQFWLRQVQHFHVVDU\\IRUQRUPDORSHUDWLRQDFFLGHQWPLWLJDWLRQRU66'



7KHOLFHQVHHDOVRHYDOXDWHGWKHHIIHFWVRISRVWXODWHGWHUPLQDOHQGEUHDNVDWFRQWDLQPHQW

SHQHWUDWLRQVRQFRQWDLQPHQWLQWHJULW\\7KHOLFHQVHHVWDWHGWKDWWKH5%SHQHWUDWLRQVIRUDOO+(

OLQHVZHUHGHVLJQHGWRZLWKVWDQGWKHIRUFHVDQGPRPHQWVDSSOLHGWRWKHWHUPLQDOHQGWKDWFRXOG

RFFXUIURPSRVWXODWHGEUHDNVORFDWHGHLWKHULQVLGHRURXWVLGHRIWKHFRQWDLQPHQWEXLOGLQJ7KH

06DQG0)':5%SHQHWUDWLRQVGLIIHUIURPWKHRWKHU5%SHQHWUDWLRQVEHFDXVHWKH\\LQFOXGH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











VWUXFWXUDODQFKRUVLQVWDOOHGDGMDFHQWWRWKH5%SHQHWUDWLRQVWRUHVWUDLQWKHSLSLQJ7KH06

DQFKRUVDUHORFDWHGLQVLGHWKH5%ZKLOHWKH0)':DQFKRUVDUHLQWKH(357KHVHDQFKRUV

DUHGHVLJQHGWRDEVRUEWKHODUJHIRUFHVDQGPRPHQWVWKDWFRXOGRFFXULQWKHDIWHUPDWKRIHLWKHU

DSRVWXODWHG06RU0)':EUHDN7KH06DQG0)':DQFKRUVFRQVLVWRIDFROODUZUDSSHG

DURXQGWKHRXWVLGHGLDPHWHURIWKHSLSLQJ7KHFROODULVFRQQHFWHGDWERWKHQGVWRWKHSLSLQJYLD

WZRFLUFXPIHUHQWLDOILOOHWZHOGV7KHFROODULVLQWXUQZHOGHGWRDVHULHVRIVWUXFWXUDOZLGHIODQJH

PHPEHUVWKDWVSDQEDFNWRWKH5%ZDOO7KHZLGHIODQJHPHPEHUVDUHWKHQZHOGHGWR

HPEHGGHGVWUXFWXUDOWHHVORFDWHGLQWKH5%ZDOO7KHOLFHQVHHSURYLGHGDVLPSOLILHGVNHWFKRI

WKH0)':DQFKRULQ$WWDFKPHQWWRWKHVXEPLWWDOGDWHG$XJXVW



7KH15&VWDIIHYDOXDWHGWKH+(/%UHVWUDLQWVDQGWKHVHSDUDWLRQSURYLGHGEHWZHHQSRVWXODWHG

EUHDNORFDWLRQVDQGWKHV\\VWHPVQHFHVVDU\\IRUPLWLJDWLRQRIWKHEUHDN7KH15&VWDIIUHYLHZHG

SODQWSLSLQJDUUDQJHPHQWGUDZLQJVIRUWKH(35DQGWKHOLFHQVHHHYDOXDWLRQVRIGLUHFW+(/%

HIIHFWVIURPSRVWXODWHGEUHDNVLQWKH$%7KH15&VWDIIGHWHUPLQHGWKDWWKHORFDWLRQRIWKH

SRVWXODWHG06WHUPLQDOHQG+(/%LQWKH(35 WKHRWKHU06OLQHH[LWVWKH5%RXWVLGHRWKHU

VWUXFWXUHVGLUHFWO\\LQWRWKH\\DUGDUHD ZDVDGHTXDWHO\\VHSDUDWHIURPRWKHUV\\VWHPVWKHUHE\\

VXSSRUWLQJWKHOLFHQVHHFRQFOXVLRQWKDWGLUHFWLQWHUDFWLRQZRXOGQRWUHDVRQDEO\\RFFXU7KHWZR

SRVWXODWHG0)':WHUPLQDOHQG+(/%ORFDWLRQVDWWKHSHQHWUDWLRQVZLWKLQHDFK(35ZHUH

VXLWDEO\\UHVWUDLQHGDQGMHWLPSLQJHPHQWHIIHFWVGLUHFWHGE\\DJXDUGSLSHVXFKWKDWWKHGLUHFW

HIIHFWVZRXOGQRWGDPDJHQRUPDOV\\VWHPVQHFHVVDU\\IRUPLWLJDWLRQ7KH66)FRPSRQHQWV

ZLWKLQWKH:35VZHUHVLPLODUO\\SURWHFWHGIURPWKHGLUHFWHIIHFWVRIWKHWHUPLQDOHQG+(/%VDW

WKHFRQWDLQPHQWSHQHWUDWLRQV7KHOLPLWLQJFRQGLWLRQVIRURSHUDWLRQRIWKHQRUPDOPLWLJDWLRQ

V\\VWHPVDQGWKH66)DUHVSHFLILHGLQWKH2FRQHH76VDQGSURYLGHUHDVRQDEOHDVVXUDQFHWKDW

WKHVHV\\VWHPVZRXOGEHDYDLODEOHIRUPLWLJDWLRQRID+(/%DVFRQVLGHUHGLQWKHOLFHQVHH¶V

DQDO\\VHV7KH15&VWDIIILQGVWKDWWKHSK\\VLFDOVHSDUDWLRQEHWZHHQWKHQRUPDOPLWLJDWLRQ

V\\VWHPVDQGWKHRQH06SHQHWUDWLRQZLWKLQWKH(35DQGWKH0)':SLSHUHVWUDLQWVDQGJXDUG

SLSHSURYLGHDFFHSWDEOHSURWHFWLRQDJDLQVWSLSHZKLSDQGMHWLPSLQJHPHQWIRUWKHOLPLWLQJ

WHUPLQDOHQG+(/%VZLWKLQWKH(35WKHUHE\\VDWLVI\\LQJ*LDPEXVVR6FKZHQFHU,WHPV

DQG



7KH15&VWDIIDOVRHYDOXDWHGWKHRWKHUORZHUHQHUJ\\WHUPLQDOHQG+(/%VSRVWXODWHGLQWKH$%

7KHOLFHQVHHGHWHUPLQHGWKDWWKHOHWGRZQOLQH+3,DQG5&3VHDOLQMHFWLRQOLQHEUHDNVLQWKH$%

ZRXOGQRWGLUHFWO\\LQWHUDFWZLWKRWKHUSLSLQJV\\VWHPVWRWKHH[WHQWWKDWVDIHW\\IXQFWLRQVZRXOGEH

DIIHFWHG%DVHGRQLWVUHYLHZRIWKHDUHDGUDZLQJVIRUWKHDUUDQJHPHQWRISLSLQJLQWKH(35DQG

HYDOXDWLRQRIWKHV\\VWHPVWKH15&VWDIIILQGVWKHOLFHQVHH¶VGHWHUPLQDWLRQDFFHSWDEOHDQG

VXIILFLHQWWRDGGUHVV*LDPEXVVR6FKZHQFHU,WHPVDQG





,QGLUHFW(QYLURQPHQWDO(IIHFWV



&RQVLVWHQWZLWKWKH*LDPEXVVR6FKZHQFHUOHWWHUVWKHOLFHQVHHDOVRHYDOXDWHGHQYLURQPHQWDO

DQGRWKHULQGLUHFWHIIHFWVRIWKHSRVWXODWHG+(/%V7KHVHHIIHFWVLQFOXGHGWKHIROORZLQJ

FRQVLGHUDWLRQV



x

&RPSDUWPHQWSUHVVXUHDQGWHPSHUDWXUHUHVSRQVHWR+(/%

x

6WUXFWXUDOUHVSRQVHWRFRPSDUWPHQWSUHVVXUL]DWLRQDQGRWKHU+(/%HIIHFWV

x

)ORRGLQJLPSDFWVLQGXFHGE\\WKH+(/%

x

0DLQWHQDQFHRIUHTXLUHGUHGXQGDQF\\LQSURWHFWLYHV\\VWHPV

x

+DELWDELOLW\\LPSDFWVRQWKHFRQWUROURRP

x

(QYLURQPHQWDOTXDOLILFDWLRQRIHVVHQWLDOHOHFWULFDOPLWLJDWLRQHTXLSPHQWLQ+(/%DUHDV

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











3UHVVXUHDQG7HPSHUDWXUH5HVSRQVHWR+(/%DQG6WUXFWXUDO(IIHFWV

7KHOLFHQVHHHYDOXDWHGWKHSUHVVXUHDQGWHPSHUDWXUHUHVSRQVHWR+(/%LQWKH7% 7KH

OLFHQVHHGHWHUPLQHGWKDWWKHODUJHYROXPHDQGRSHQFRQVWUXFWLRQRIWKH7%ZRXOGSUHFOXGHDQ\\

VLJQLILFDQWSUHVVXUL]DWLRQWKHUHIRUHWKHOLFHQVHHGLGQRWFRQGXFWDGHWDLOHGDQDO\\VLVRIWKH

EXLOGLQJSUHVVXUHDQGWHPSHUDWXUHUHVSRQVH7KHOLFHQVHHFRQFOXGHGWKDWWKH7%VWUXFWXUH

ZRXOGH[SHULHQFHRQO\\ORFDOL]HGGDPDJHWRVWUXFWXUDOFROXPQVDVDUHVXOWRISLSHZKLSDQGMHW

LPSLQJHPHQWDQGWKHOLFHQVHHKDVLGHQWLILHGFRQIRUPLQJPRGLILFDWLRQVWRWKHFROXPQVWRHQVXUH

WKDW66'FRQGLWLRQVFDQEHDFKLHYHGDQGPDLQWDLQHG



7KHOLFHQVHHSHUIRUPHGDPRUHGHWDLOHGDQDO\\VLVRI+(/%VLQWKH$%,Q$WWDFKPHQWWRWKH

/$5WKHOLFHQVHHGHVFULEHGDQDQDO\\VLVDGGUHVVLQJOLPLWLQJEUHDNVLQWKH(35DQG:357KH

(35DQG:35ZKLFKDUHDGMDFHQWWRWKH5%FRQWDLQSLSLQJWHUPLQDOHQGVDWFRQWDLQPHQW

SHQHWUDWLRQVDQGZRXOGH[SHULHQFHPRUHVLJQLILFDQWSUHVVXUHDQGWHPSHUDWXUHWUDQVLHQWVLQ

UHVSRQVHWR+(/%VEHFDXVHRIWKHOLPLWHGYROXPHRIWKHURRPV%\\UHSRUWGDWHG$SULO

5HIHUHQFH LQWKHUHVSRQVHWRWKH*LDPEXVVR6FKZHQFHUOHWWHUVWKHOLFHQVHHGHVFULEHG

WKHLQVWDOODWLRQRIOLJKWZHLJKWEORZRXWSDQHOVLQVHOHFWHGZDOOVRIHDFKXQLW¶V(35WRUHGXFHWKH

SHDNSUHVVXUHLQWKHVHURRPVDQGSUHSDUHGDQDQDO\\VLVRIWKHSUHVVXUHDQGWHPSHUDWXUH

UHVSRQVH7KHOLFHQVHHKDVVLQFHXSGDWHGWKLVDQDO\\VLVWRXVHWKH*27+,&&RGHDQGUHYLVHG

EORZGRZQGDWDIRUWKH06DQG0)':+(/%VDQGPDGHDGGLWLRQDOPRGLILFDWLRQVWRWKH(35



7KHOLFHQVHHSURYLGHGDGGLWLRQDOLQIRUPDWLRQUHJDUGLQJWKHXSGDWHG(35DQDO\\VLVLQLWV5$,

UHVSRQVHOHWWHUGDWHG6HSWHPEHU 5HIHUHQFH 7KHOLFHQVHHGHVFULEHGWKDWWKHSLSH

PRYHPHQWDQGMHWGLUHFWLRQOHQJWKIRUHDFKSRVWXODWHG+(/%ZDVGHWHUPLQHGEDVHGRQ

LQIRUPDWLRQFROOHFWHGGXULQJZDONGRZQVRIWKHEUHDNORFDWLRQV7KH06WHUPLQDOHQGEUHDNZDV

SRVWXODWHGWRRFFXUDWDZHOGDVKRUWGLVWDQFHIURPWKH5%ZDOO)URPWKHSRVWXODWHGEUHDN

ORFDWLRQWKH06SLSHEHQGVGRZQZDUGDWDQHOERZDGMDFHQWWRWKHEUHDNORFDWLRQDQGEDFNWR

KRUL]RQWDODWDVHFRQGHOERZDERXWIHHWEHORZWKHILUVWHOERZ7KHOLFHQVHHGHWHUPLQHGWKDW

WKLVSLSHFRQILJXUDWLRQZRXOGUHVXOWLQWKHSULPDU\\MHWIURPWKH6*LQWKH5%SRLQWLQJRXWZDUG

IURPWKH5%ZDOOWRZDUGEORZRXWSDQHOVDQGSLSHPRYHPHQWDZD\\IURPWKHEUHDNORFDWLRQ

ZKLFKGLUHFWVWKHVHFRQGDU\\DQGPXFKZHDNHUMHWXSZDUG7KXVWKHSLSHPRWLRQVDQGMHW

HIIHFWVDUHGLUHFWHGDZD\\IURPHVVHQWLDO66'HTXLSPHQWLQWKH(35



,QLWVOHWWHUGDWHG6HSWHPEHUWKHOLFHQVHHDOVRGHVFULEHGWKH*27+,&PRGHORIWKH

(35ZKLFKXVHGIRXUYROXPHVDVIROORZV



x

9ROXPHUHSUHVHQWHGWKHQDUURZYROXPHEHWZHHQDFROXPQOLQHDQGWKH:35ZDOODQG

ZDVPRGHOHGE\\OXPSHGSDUDPHWHUVZLWKMXQFWLRQVDWWKHWRSDQGERWWRPWRWKHPDLQ

YROXPH 9ROXPH WRUHSUHVHQWUHFLUFXODWLRQIORZWKURXJKWKHPRVWO\\RSHQERXQGDU\\

x

9ROXPHZKLFKUHSUHVHQWHGWKHPDLQ(35YROXPHEHWZHHQWKH1RUWK6RXWKFROXPQ

OLQHE\\WKH:35DQGDQ(DVW:HVWFROXPQOLQHZDVVXEGLYLGHGLQWRDILQHFDOFXODWLRQDO

PHVKWRVXSSRUWDFFXUDWHPRGHOLQJRIWKHIORZSDWWHUQVLQWKH(35DQGWKHRULHQWDWLRQRI

WKHYDULRXVSRVWXODWHGSLSHEUHDNV

x

9ROXPHUHSUHVHQWHGDOXPSHGSDUDPHWHUYROXPHFRQVLVWLQJRIWKHUHPDLQGHURIWKH

(35WKDWKDVDKLJKHUIORRUHOHYDWLRQWKDQ9ROXPHVDQGDQGWKDWODUJHO\\DFWVDVD

IORZSDWKEHWZHHQVHYHUDOMXQFWLRQVZLWK9ROXPHDQGVRPHEORZRXWSDQHOV

x

9ROXPHUHSUHVHQWHGWKHDWPRVSKHUHRXWVLGHWKHEORZRXWSDQHOVDQGZDVFRQQHFWHG

WRWKH(35E\\MXQFWLRQVUHSUHVHQWLQJWKHEORZRXWSDQHOV

x

7KHMXQFWLRQVEHWZHHQWKHYROXPHVUHSUHVHQWHGODUJHRSHQLQJVDQGZHUHPRGHOHGZLWK

ORZORVVFRHIILFLHQWVWRUHIOHFWWKHODUJHIORZDUHD)RUWKHMXQFWLRQVH[SHULHQFLQJ

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











VLJQLILFDQWIORZGXHWRSUHVVXUL]DWLRQWKHOLFHQVHHVHOHFWHGVRPHZKDWODUJHUYDOXHVWR

UHIOHFWWKHHIIHFWRIUDSLGSUHVVXUL]DWLRQ

x

6HYHUDOMXQFWLRQVEHWZHHQWKH(35YROXPHVDQGWKHDWPRVSKHUHUHSUHVHQWHGWKHEORZ

RXWSDQHOVDVTXLFNRSHQLQJYDOYHVZLWKVHWSRLQWVEHWZHHQWRSVLG



,Q$WWDFKPHQWWRWKHVXEPLWWDOGDWHG$XJXVWWKHOLFHQVHHGHVFULEHGKRZRSHUDWRU

DFWLRQVDQGSURWHFWLYHLQVWUXPHQWDWLRQDFWXDWLRQVZHUHPRGHOHGLQWKHDQDO\\VLV)RU06

+(/%VWKHDQDO\\VLVDVVXPHVWKDWQRRSHUDWRUDFWLRQLVWDNHQZLWKLQWKHILUVWPLQXWHV7KH

0)':SXPSVDUHDVVXPHGWREHWULSSHGE\\$),6ZKHQWKHDFWXDWLRQVHWSRLQWLVUHDFKHGEXW

WKH0)':FRQWUROYDOYHLVDVVXPHGWRIDLORSHQ0)':LVDVVXPHGWRFRQWLQXHIHHGLQJWKH

IDXOWHG6*YLDWKHFRQGHQVDWHERRVWHUSXPSVXQWLO0)':LVLVRODWHGE\\WKHRSHUDWRUDW

PLQXWHV7KHDQDO\\VLVPRGHOVWKDW():LVDXWRPDWLFDOO\\VWRSSHGE\\$),6ZKHQWKHDFWXDWLRQ

VHWSRLQWLVUHDFKHG)RU0)':+(/%VWKHDQDO\\VLVDVVXPHV0)':FRQWLQXHVXQWLOWKH

FRQGHQVDWHLQYHQWRU\\LVGHSOHWHG LHQRRSHUDWRUDFWLRQDVVXPHGWRLVRODWH0)': 



7KHOLFHQVHHHYDOXDWHGWKHSUHVVXUHDQGWHPSHUDWXUHHIIHFWVRIWKH06WHUPLQDOHQGEUHDNWKH

OLPLWLQJ0)':WHUPLQDOHQGEUHDNDQGWKHOLPLWLQJ0)':FULWLFDOFUDFNEUHDNLQHDFKXQLW¶V

(35XVLQJWKHDERYHPRGHO7KH06WHUPLQDOHQGEUHDNSURGXFHGWKHKLJKHVWWHPSHUDWXUHDQG

SUHVVXUHLQWKH(35ZLWKSHDNSUHVVXUHDVKLJKDVSVLJDQGDSHDNWHPSHUDWXUHRI)

LQHDFKURRP7KH06SULPDU\\MHWRULHQWDWLRQGLUHFWHGVRPHRIWKHIORZLQWR9ROXPHDQGWKH

SUHVVXUL]DWLRQRI9ROXPHDOVRUHVXOWHGLQWKHLPPHGLDWHRSHQLQJRIEORZRXWSDQHOVEHWZHHQ

9ROXPHDQGWKHDWPRVSKHUH7KHUHIRUHWKHOLFHQVHHFRQFOXGHGWKDWWKHOXPSHGSDUDPHWHU

PRGHOLQJGLGQRWLPSDFWWKHEHKDYLRURIWKHEORZRXWSDQHOVLQ9ROXPH7KHOLFHQVHHDOVR

GHWHUPLQHGWKDW9ROXPHZDVVXIILFLHQWO\\GLVWDQWIURPWKH06WHUPLQDOHQGEUHDNWKDWLWV

OXPSHGSDUDPHWHUPRGHOLQJDOVRGLGQRWLPSDFWWKHDQDO\\VLV



7KHOLFHQVHHSURYLGHGWKHIROORZLQJVWDWHPHQWUHJDUGLQJVWUXFWXUDODQDO\\VLVRIWKH(35IRUWKH

ORDGLQJLPSRVHGE\\WKH06+(/%LQLWVUHVSRQVHOHWWHUGDWHG6HSWHPEHU



$QDQDO\\VLVRIWKH(35VWUXFWXUHZDVSHUIRUPHGZLWKSUHVVXUHUHVSRQVHVWKDW

ERXQGWKRVHGHYHORSHGIRUWKH06+(/%SUHVVXUHVOLVWHGDERYH7KLVDQDO\\VLV

LVFRQWDLQHGLQ>DOLFHQVHHFDOFXODWLRQ@$OODQDO\\]HGUHLQIRUFHGFRQFUHWHDQG

VWHHOVWUXFWXUDOFRPSRQHQWVIRUHDFKRIWKHSHQHWUDWLRQURRPVPHWHLWKHUWKH

HODVWLFRUSODVWLFDFFHSWDQFHFULWHULD,QDOOFDVHVWKHFHLOLQJVWUXFWXUHPHHWV

HLWKHUHODVWLFRUSODVWLFFULWHULDDQGGHPRQVWUDWHVWKDWJURVVIDLOXUHRIWKHFHLOLQJ

VWUXFWXUHZLOOQRWRFFXUIROORZLQJWKHSRVWXODWHG06+(/%



7KHOLFHQVHHSURYLGHGDGGLWLRQDOGHVFULSWLRQVRIWKH$%DQG7%UHVSRQVHWR+(/%SUHVVXUH

HIIHFWVLQ$WWDFKPHQWWRWKH/$5XQGHU*LDPEXVVR6FKZHQFHU,WHPVDQG7KH

OLFHQVHHGHWHUPLQHGWKDWRQO\\WKH(35DQG:35FHLOLQJVZRXOGEHVXEMHFWHGWRVLJQLILFDQW

UHYHUVDORIORDG7KHFHLOLQJVWUXFWXUHVDUHQRUPDOO\\ORDGHGZLWKHTXLSPHQWDQGGHDGORDGV

3UHVVXUL]DWLRQRIWKH(35DQG:35GXHWRSRVWXODWHG0)':DQG06+(/%VORFDWHGLQWKH

(35ZRXOGH[HUWDQXSZDUGORDGRQWKHFHLOLQJVWUXFWXUHIROORZHGE\\DUHHVWDEOLVKPHQWRIWKH

HTXLSPHQWDQGGHDGORDGV7KHOLFHQVHHVWDWHGWKDWWKHHYDOXDWLRQUHVXOWVVKRZWKDWWKH

ORDGLQJVZRXOGEHZLWKLQWKHDFFHSWDEOHOLPLWV7KH&5VFDEOHVSUHDGLQJURRPVDQGFRQWURO

EDWWHU\\URRPDUHVHSDUDWHGIURPWKHSHQHWUDWLRQURRPVE\\UHLQIRUFHGZDOOV+RZHYHUVHYHUDO

XQUHLQIRUFHGPDVRQU\\ZDOOVDUHH[SHFWHGWRFUDFNDQGSRWHQWLDOO\\IDLO7KH15&VWDIIGLVFXVVHV

WKHHIIHFWRIWKHVHPDVRQU\\ZDOOIDLOXUHVLQWKHVXEVHFWLRQDGGUHVVLQJKDELWDELOLW\\EHORZEHFDXVH

WKH\\VHSDUDWH&5GXFWZRUNIURPWKH(35

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











7KH15&VWDIIUHYLHZHGWKHVXSSRUWLQJ+(/%SUHVVXUHDQGWHPSHUDWXUHUHVSRQVHDQDO\\VLVDV

SDUWRILWVDXGLWDFWLYLWLHVDQGHYDOXDWHGWKHOLFHQVHH¶VUHVSRQVHSURYLGLQJPRGHOLQJGHWDLOV

LQLWLDOFRQGLWLRQVDVVXPSWLRQVDQGUHVXOWVIRUWKHDQDO\\VLV7KH15&VWDIIGHWHUPLQHGWKDWWKH

PRGHOLQJLQLWLDOFRQGLWLRQVDQGDVVXPSWLRQVZHUHUHDVRQDEOHIRUWKHSRVWXODWHG+(/%DQDO\\VLV

7KH15&VWDIIILQGVWKDWWKHDQDO\\VLVUHVXOWVDQGRWKHULQIRUPDWLRQSURYLGHUHDVRQDEOH

DVVXUDQFHWKDWWKH7%DQG(35VWUXFWXUHVZRXOGZLWKVWDQGWKHSUHVVXUL]DWLRQUHVXOWLQJIURP

SRVWXODWHG+(/%VZLWKRXWVLJQLILFDQWGDPDJHWKDWFRXOGFKDOOHQJHWKHFRPSOHWLRQRI66'

IXQFWLRQVDQGZRXOGEHVXIILFLHQWWRDGGUHVV*LDPEXVVR6FKZHQFHU,WHPVDQG





)ORRGLQJ,PSDFWVRI3RVWXODWHG+(/%V



  • LDPEXVVR6FKZHQFHU,WHPUHTXHVWVDGLVFXVVLRQRIWKHSRWHQWLDOIRUIORRGLQJRIVDIHW\\

UHODWHGHTXLSPHQWLQWKHHYHQWRIIDLOXUHRID)':OLQHRUDQ\\RWKHUOLQHFDUU\\LQJD+(IOXLG7KH

OLFHQVHHSURYLGHGWKLVLQIRUPDWLRQLQ$WWDFKPHQWWRLWVVXEPLWWDOGDWHG$XJXVW

  • LDPEXVVR6FKZHQFHU,WHPUHTXHVWVDGLVFXVVLRQRIWKHOHDNGHWHFWLRQHTXLSPHQW

FDSDELOLWLHVDVVRFLDWHGZLWKDQ\\IORRGPLWLJDWLRQPRGLILFDWLRQ

$X[LOLDU\\%XLOGLQJ



7KHOLFHQVHHGHWHUPLQHGWKDWSRVWXODWHGSLSHIDLOXUHVLQWKH0)':V\\VWHPFDQOHDGWRIORRGLQJ

LQVLGHWKH(35DQGWKHOLFHQVHHLQVWDOOHGIORRGSURWHFWLRQPRGLILFDWLRQVLQWKHVHURRPV

LQFOXGLQJEDUULHUVDQGIORRGRXWOHWGHYLFHV7KHOLFHQVHHVWDWHGWKDWWKLVGHVLJQHQVXUHVWKDW

IORRGZDWHUIURPWKH0)':OLQHEUHDNVLVUHOHDVHGWRWKHRXWVLGHDWDUDWHVXIILFLHQWWRSUHYHQW

VXEPHUJHQFHRIWKHHOHFWULFDOSHQHWUDWLRQVLQWKH(357KHUHVXOWLQJZDWHUOHYHOLQVLGHWKH(35

LVOLPLWHGWRIHHWDQGWKHOLFHQVHHGHWHUPLQHGWKDWWKH$%IORRUVWUXFWXUHFDQVXVWDLQDIRRW

IORRGKHLJKWZLWKRXWIDLOXUH)ORRGLPSRXQGPHQWZDOOVZHUHLQVWDOOHGLQHDFK(35WROLPLWIORRG

ZDWHUIURPEHLQJUHOHDVHGWRRWKHUDUHDVRIWKH$%$Q\\ZDWHUUHOHDVHGWRRWKHUDUHDVRIWKH

$%FRXOGHYHQWXDOO\\UHDFKWKH+3,SXPSURRPV7KHIORRGLPSRXQGPHQWZDOOVSURWHFWWKH+3,

SXPSURRPVIURPIORRGLQJFDXVHGE\\OLQHEUHDNVLQVLGHWKH(35



7KHOLFHQVHHDOVRLGHQWLILHGWKDWSRVWXODWHGSLSHUXSWXUHVRQWKHGLVFKDUJHRIWKHµ$¶RUµ%¶+3,

SXPSVFRXOGOHDGWRIORRGLQJRIWKH+3,SXPSURRPV7KHOLFHQVHHGHWHUPLQHGWKDWVXIILFLHQW

WLPHH[LVWVIRUWKHRSHUDWRUVWRGLDJQRVHDQGLVRODWHWKHEUHDNWRSUHFOXGHWKHORVVRIDOO+3,

SXPSVGXHWRIORRGLQJ7RDGGUHVVIDLOXUHVRIDFWLYHFRPSRQHQWVWKHOLFHQVHHGHVFULEHG

FRQIRUPLQJPRGLILFDWLRQVWRVXSSRUWLVRODWLRQRIWKHIDXOWHGSXPSGLVFKDUJHZKLOHNHHSLQJWZR

+3,SXPSVDQGWZR+3,IORZSDWKVDYDLODEOHIRUDFKLHYLQJDQGPDLQWDLQLQJDQ66'FRQGLWLRQ

7KLVPRGLILFDWLRQZRXOGPDLQWDLQWKH+3,IXQFWLRQDVVXPLQJDQ6$)



$VGLVFXVVHGSUHYLRXVO\\SRVWXODWHG+(/%VLQWKH7%FDQUHVXOWLQDORVVRI9$&SRZHU

$ORVVRI9$&SRZHUUHVXOWVLQDORVVRIVSHQWIXHOFRROLQJDQGKHDWUHPRYDOWKURXJK

JUHDWO\\LQFUHDVHGHYDSRUDWLRQIURPWKHVSHQWIXHOSRRO 6)3 7KHOLFHQVHHGHVFULEHGWKDW

FRQGHQVHGZDWHUYDSRUIURPWKH6)3FRXOGGUDLQWRWKHILUVWIORRURIWKH$%DQGIORRGWKHVDIHW\\

UHODWHG+3,SXPSV7KHOLFHQVHHVWDWHGWKDWSURFHGXUHVDUHLQSODFHWRYHQWZDWHUYDSRUIURP

WKHVSHQWIXHOEXLOGLQJDQGWREORFNWKHVSHQWIXHOEXLOGLQJIORRUGUDLQVWRSUHYHQW+3,SXPS

IORRGLQJIURPRFFXUULQJ



7KH15&VWDIIHYDOXDWHGWKHLQVWDOOHGSURYLVLRQVDQGRSHUDWRUDFWLRQVWRPLWLJDWHSRWHQWLDO

IORRGLQJZLWKLQWKH$%DVDUHVXOWRID+(/%7KH15&VWDIIGHWHUPLQHGWKDWUHDVRQDEOH

PRGLILFDWLRQVKDYHEHHQPDGHDQGDSSURSULDWHRSHUDWRUDFWLRQVKDYHEHHQLGHQWLILHGWR

DFFRPPRGDWHIORRGLQJHIIHFWVDVVRFLDWHGZLWKSRVWXODWHG$%+(/%V%DVHGRQWKHDERYHWKH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











15&VWDIIILQGVWKDWWKHOLFHQVHHDGGUHVVHG*LDPEXVVR6FKZHQFHU,WHPVXIILFLHQWO\\IRUWKH

$%



7XUELQH%XLOGLQJ



7KHOLFHQVHHLGHQWLILHGVHYHUDOSLSLQJVHJPHQWVLQWKH/36:DQG&&:V\\VWHPVWKDWFRXOGEH

GDPDJHGE\\SLSHZKLSHIIHFWVLQWKH7%DQGUHVXOWLQIORRGLQJ)ORRGVLQWKH7%FDQEH

LGHQWLILHGE\\DIORRGGHWHFWLRQV\\VWHPZKLFKSURYLGHVWKH&5DODUPVWRZDUQRIDIORRG

6\\VWHPVDQGFRPSRQHQWVORFDWHGLQWKH7%EDVHPHQWDUHQRWSURWHFWHGIURPIORRGLQJE\\

EDUULHUVEXWWKHOLFHQVHHHQKDQFHGWKHGUDLQFDSDFLW\\7KHOLFHQVHHFUHGLWVH[LVWLQJIORRG

SURWHFWLRQPHDVXUHVWRHQVXUHWKDW7%IORRGLQJGRHVQRWSURSDJDWHWRDIIHFWWKH$%'DPDJH

UHSDLUJXLGHOLQHVDUHFUHGLWHGWRWHUPLQDWHWKHVRXUFHRIIORRGLQJDQGUHSDLUWKRVHV\\VWHPVDQG

FRPSRQHQWVQHFHVVDU\\WRUHDFK&6' HJWKH/36:V\\VWHP 



%\\OHWWHUGDWHG6HSWHPEHUWKHOLFHQVHHUHVSRQGHGWRDQ5$,E\\DGGUHVVLQJWKH

SRWHQWLDOIRU7%IORRGLQJLQJUHDWHUGHWDLO7KHOLFHQVHHVWDWHGWKDWERWKGLUHFWDQGLQGLUHFW

FDXVHVRIIORRGLQJKDGEHHQHYDOXDWHG)RUGLUHFWHIIHFWVWKHOLFHQVHHLGHQWLILHGVHYHQ

SRVWXODWHG0)':+(/%ORFDWLRQVDFURVVWKHWKUHHXQLWVZKHUHWKHOLFHQVHHGHWHUPLQHGWKDW

/36:SLSLQJZDVZLWKLQWKHSLSHZKLSLPSDFW]RQHDQGWKHUHE\\FRQVLGHUHGDIORRGVRXUFHLQ

DGGLWLRQWRWKHIORRGLQJIURPWKH0)':V\\VWHP$OWKRXJKWKHOLFHQVHHLGHQWLILHGPXOWLSOH/36:

SLSHVHJPHQWVZLWKLQFHUWDLQ0)':SLSHZKLS]RQHVWKHOLFHQVHHGHWHUPLQHGWKDWWKH

PD[LPXPHTXLYDOHQWFURVVVHFWLRQDODUHDLIDOOSLSHVLQWKHDUHDZHUHUXSWXUHGZDVERXQGHG

E\\WKHGHVLJQEDVLV7%IORRGDVVRFLDWHGZLWK&&:H[SDQVLRQMRLQWIDLOXUH7KHOLFHQVHHDOVR

GHVFULEHGSRWHQWLDOLQGLUHFWHIIHFWVIURPORFDOL]HGVWUXFWXUDOGDPDJHWKDWFRXOGUHVXOWLQ

LQFUHDVHGIORRGLQJ7KHOLFHQVHHDVVXPHGWKDWWKHORFDOL]HGVWUXFWXUDOGDPDJHFRXOGUHVXOWLQ

FROODSVHWKDWZRXOGLPSDOHRUFUXVKSLSLQJLQFOXGLQJWKHLQFKQRPLQDOGLDPHWHU&&:SLSLQJ

KRZHYHUFRQIRUPLQJPRGLILFDWLRQVWRWKH7%FROXPQVZRXOGUHGXFHWKHOLNHOLKRRGRIORFDOL]HG

VWUXFWXUDOGDPDJHDQGWKHFRQVHTXHQWIORRGLQJ7KHOLFHQVHHGHWHUPLQHGWKLVW\\SHRIGDPDJH

FRXOGUHVXOWLQIORRGUDWHVH[FHHGLQJWKHGHVLJQEDVLV7%IORRGEXWIRXQGE\\DQDO\\VLVWKDWWKH

PRGLILFDWLRQWRLQVWDOOWKH7%GUDLQZRXOGDOORZDORQJHUWLPHSHULRGIRURSHUDWRUDFWLRQWRWULSWKH

&&:SXPSVWKDQDVVXPHGIRUWKHGHVLJQEDVLV7%IORRG5HJDUGOHVVRIIORRGFDXVHVRXUFH

DQGWKHDFWLRQWRWULSWKH&&:SXPSVWKHOLFHQVHHVWDWHGWKDWDGGLWLRQDODFWLRQVFRXOGEH

QHFHVVDU\\WRFRPSOHWHO\\VWRSWKHIORRGLQJSRWHQWLDOO\\LQYROYLQJHLWKHULVRODWLRQRIWKHGDPDJHG

SLSLQJVHFWLRQRUORZHULQJRIWKH.HRZHH/DNHOHYHO2QFHWKHIORRGLQJVRXUFHLVVWRSSHGWKH

IORRGZDWHUZRXOGUHFHGHWKURXJKWKH7%GUDLQDQGSHUPLWFRPSOHWLRQRIUHSDLUVZLWKLQVHYHUDO

GD\\V



7KHOLFHQVHHGHVFULEHGWKHFDSDELOLW\\RI7%IORRGGHWHFWLRQLQVWUXPHQWDWLRQIRU+(/%UHODWHG

IORRGPLWLJDWLRQ7KH7%ZDWHUOHYHOV\\VWHPSURYLGHVDODUPVDWWZRVHSDUDWH7%VXPSZDWHU

OHYHOVRQDQQXQFLDWRUVLQWKH8QLW&5DQGFRPSXWHUDODUPVLQWKH8QLW&57KHOLFHQVHH

HYDOXDWHGWKHSDWKRIWKHVHDODUPLQSXWVIURPWKHOHYHOVZLWFKHVLQHDFKXQLWWRWKHFRQWUROSDQHO

RXWVLGHWKH8QLW&5



,QLWVOHWWHUGDWHG6HSWHPEHUWKHOLFHQVHHDGGUHVVHGWKHFDSDELOLW\\RIWKH36:

V\\VWHPDVEDFNHGXSE\\WKH66)WRVXSSRUWUHFRYHU\\IURP7%IORRGLQJ7KH36:V\\VWHPLV

ORFDWHGRXWVLGHRIWKH7%7KHOLFHQVHHVWDWHGWKDWWKHGDPDJHWRWKHVHUYLFHZDWHUSLSLQJLQ

WKH7%ZRXOGQRWDIIHFWWKHORQJWHUPFRROLQJFDSDELOLW\\RIWKH36:V\\VWHP7KH36:SXPS

GRHVQRWUHO\\RQWKHVHUYLFHZDWHUSLSLQJDVDZDWHUVRXUFHEHFDXVHLWWDNHVVXFWLRQIURPWKH

8QLWHPEHGGHG&&:SLSLQJDQGDVXEPHUVLEOHSXPSLQVWDOOHGLQWKHLQWDNHFDQDOSURYLGHV

PDNHXSWRWKHHPEHGGHG&&:SLSLQJ

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











7KH15&VWDIIHYDOXDWHGWKHHIIHFWRI7%IORRGLQJRQWKHFDSDELOLW\\WRDFKLHYHDQGPDLQWDLQ

66'7KHSURSRVHGPLWLJDWLRQVWUDWHJ\\UHOLHVRQWKH36:V\\VWHPZLWKWKH66)DVEDFNXS

ZKLFKSURYLGHVWKHFDSDELOLW\\WRPDLQWDLQ66'IRUDQH[WHQGHGSHULRG7KLVSHULRGLQ+RW

6KXWGRZQZRXOGDOORZIRUQHFHVVDU\\UHSDLUVWRVXSSRUWIXUWKHUFRROGRZQWR&6'LQYROYLQJ

HOHFWULFDOVZLWFKJHDU/36:SXPSPRWRUVDQGGDPDJHGSLSLQJ%DVHGRQWKHDERYHWKH15&

VWDIIILQGVWKHUHVSRQVHVXIILFLHQWWRDGGUHVV*LDPEXVVR6FKZHQFHU,WHPIRUWKH7%





0DLQWHQDQFHRI5HTXLUHG5HGXQGDQF\\LQ3URWHFWLYH6\\VWHPV



7KHOLFHQVHHDGGUHVVHG*LDPEXVVR6FKZHQFHU,WHPLQ$WWDFKPHQWWRWKH/$57KLVLWHP

VSHFLILHVWKDWUXSWXUHRIDSLSHFDUU\\LQJ+(IOXLGVKRXOGQRWGLUHFWO\\RULQGLUHFWO\\UHVXOWLQHLWKHU



D /RVVRIUHTXLUHGUHGXQGDQF\\LQDQ\\SRUWLRQRIWKHSURWHFWLRQV\\VWHP&ODVV(HOHFWULFDO

V\\VWHP(6HTXLSPHQWFDEOHSHQHWUDWLRQVRUWKHLULQWHUFRQQHFWLQJFDEOHVUHTXLUHGWR

PLWLJDWHWKHFRQVHTXHQFHVRIWKDWDFFLGHQWDQGSODFHWKHUHDFWRU V LQD&6'&RQGLWLRQ

RU

E (QYLURQPHQWDOLQGXFHGIDLOXUHVFDXVHGE\\DOHDNRUUXSWXUHRIWKHSLSHZKLFKZRXOGQRW

RILWVHOIUHVXOWLQSURWHFWLYHDFWLRQEXWGRHVGLVDEOHSURWHFWLRQIXQFWLRQV,QWKLVUHJDUGD

ORVVRIUHGXQGDQF\\LVSHUPLWWHGEXWDORVVRIIXQFWLRQLVQRWSHUPLWWHG)RUVXFK

VLWXDWLRQVSODQWVKXWGRZQLVUHTXLUHG



7KHOLFHQVHHGHVFULEHGWKDWWKHFRUHSURWHFWLRQV\\VWHPVDW216FRQVLVWRIWKH536DQG(6

V\\VWHPV7KH536WULSVWKHUHDFWRUWRSUHYHQWH[FHHGLQJDFFHSWDEOHIXHOGDPDJHOLPLWV7KH

(6V\\VWHPDXWRPDWLFDOO\\LQLWLDWHVWKH+3,DQG/3,6\\VWHPVRQHLWKHUDORZ5&6SUHVVXUHRU

KLJKFRQWDLQPHQWSUHVVXUH7KHFDELQHWVIRUWKH536DQG(6V\\VWHPVDUHSK\\VLFDOO\\ORFDWHG

LQVLGHWKHFRQWUROFRPSOH[DQGWKHUHIRUHDUHSURWHFWHGIURPWKHHIIHFWVRISRVWXODWHG+(/%V

RXWVLGHRIWKHFRQWDLQPHQWEXLOGLQJ+(/%VRXWVLGHRIWKHFRQWDLQPHQWEXLOGLQJFDQOHDGWR

HLWKHULQDGHTXDWHKHDWWUDQVIHURUH[FHVVLYHKHDWWUDQVIHULQWKH5&6,QDGHTXDWHKHDWWUDQVIHU

UHVXOWVLQKLJK5&6SUHVVXUHFRQGLWLRQV([FHVVLYHKHDWWUDQVIHUUHVXOWVLQORZ5&6SUHVVXUH

FRQGLWLRQV7KH536WULSRQKLJK5&6SUHVVXUHLVFUHGLWHGIRULQDGHTXDWHKHDWWUDQVIHU7KH

536WULSRQORZ5&6SUHVVXUHRUYDULDEOHORZ5&6SUHVVXUHLVFUHGLWHGIRUH[FHVVLYHKHDW

WUDQVIHU7KH(6V\\VWHPLVH[SHFWHGWREHDFWXDWHGIROORZLQJH[FHVVLYHKHDWWUDQVIHURU

OHWGRZQOLQHEUHDNV7KHUHDUH5&6SUHVVXUHDQGWHPSHUDWXUHLQVWUXPHQWVWKDWIHHGWKH536

7KHVHLQVWUXPHQWVDUHORFDWHGLQVLGHRIWKHFRQWDLQPHQWEXLOGLQJ7KHFRQWDLQPHQWSUHVVXUH

LQVWUXPHQWVDUHQRWUHTXLUHGIRU+(/%VRXWVLGHRIWKHFRQWDLQPHQWEXLOGLQJ7KHUHDUH5&6

SUHVVXUHWUDQVPLWWHUVWKDWIHHGLQWRWKH(6V\\VWHP7KHVHLQVWUXPHQWVDUHDOVRORFDWHGLQVLGH

RIWKHFRQWDLQPHQWEXLOGLQJ7KHFDEOLQJIURPWKHVHLQVWUXPHQWVIRU536DQG(6V\\VWHPVDUH

URXWHGWKURXJKWKHSHQHWUDWLRQURRPVWRWKH&657KHHOHFWULFDOSHQHWUDWLRQVDQGWKH

DVVRFLDWHGFDEOLQJIRUWKHLQVWUXPHQWVDUHTXDOLILHGIRUWKHHQYLURQPHQWDOFRQGLWLRQVLQVLGHWKH

SHQHWUDWLRQURRPDQGWKHVHFDEOHVDUHQRWLPSDFWHGGLUHFWO\\E\\DQ\\SRVWXODWHG+(/%VLQWKH

SHQHWUDWLRQURRP7KHUHIRUHWKHUHLVQRH[SHFWHGORVVRIUHTXLUHGUHGXQGDQF\\GXHWRWKH

HIIHFWVRISRVWXODWHG+(/%VRXWVLGHRIWKHFRQWDLQPHQWEXLOGLQJ



7KHOLFHQVHHSURYLGHGWKHIROORZLQJGHVFULSWLRQRIFDSDELOLWLHVWRPDLQWDLQHVVHQWLDOIXQFWLRQV

IROORZLQJHQYLURQPHQWDOHIIHFWVRI+(/%V



7KH&ODVV(HOHFWULFDOV\\VWHPPD\\EHGDPDJHGE\\SRVWXODWHG+(/%VLQVLGHWKH

7%7KHGLUHFWHIIHFWV SLSHZKLSDQGMHWLPSLQJHPHQW IURPVRPH+(/%VPD\\

UHVXOWLQGDPDJHWRWKH9$&VZLWFKJHDUV9$&PDLQIHHGHUEXVHVRU

DVVRFLDWHGFDEOLQJWKDWPD\\UHVXOWLQORVVRIWKHSRZHUVRXUFHVWRWKH

9$&9$&HOHFWULFDOGLVWULEXWLRQV\\VWHPV7KHHIIHFWZRXOGEHVLPLODUWRD

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











6%27RDGGUHVVWKHORVVRIWKHVHSRZHUVRXUFHVWZRDOWHUQDWHPHDQVRI

DFKLHYLQJD66'FRQGLWLRQDUHDYDLODEOHWKURXJKWKH36:V\\VWHPDQGWKH66)

7ZRDOWHUQDWHPHDQVRIDFKLHYLQJDQGPDLQWDLQLQJD66'FRQGLWLRQDUHSURYLGHG

WRDGGUHVV6$)V



7KH36:V\\VWHPLVFDSDEOHRIPDLQWDLQLQJWKH66'FRQGLWLRQIURPWKHXQLW&5

(OHFWULFDOSRZHUWRWKH36:V\\VWHPLVSURYLGHGIURPHLWKHUWKHN9SRZHUOLQH

RUIURPD.HRZHH+\\GURHOHFWULFXQLWRXWVLGHWKH7%7KH36:SXPSFDQEH

VWDUWHGIURPWKH&5WRIHHGHLWKHURUERWK6*VWRPDLQWDLQVHFRQGDU\\VLGHKHDW

UHPRYDO7KH36:SXPSDOVRVXSSOLHVFRROLQJZDWHUWRWKH+3,SXPSPRWRUV

3RZHUIRURQH+3,SXPSFDQEHUHVWRUHGIURPWKH36:HOHFWULFDOV\\VWHPDVZHOO

DVVHOHFWHGPRWRURSHUDWHGYDOYHVWRDOLJQSXPSVXFWLRQWRWKH%:67DQG

FRQWUROIORZWRWKH5&6YLDWKHµ$¶LQMHFWLRQKHDGHUDQG5&3VHDOLQMHFWLRQ5&6

SUHVVXUHFDQEHFRQWUROOHGE\\XVLQJSUHVVXUL]HUKHDWHUVSRZHUHGIURPWKH36:

HOHFWULFDOV\\VWHP)LQDOO\\WKHFRQWUROEDWWHULHVVHUYLQJWKH9'&>YROWVGLUHFW

FXUUHQW@DQG9$&9LWDO, &V\\VWHPVFDQEHUHFKDUJHGIURPWKHEDWWHU\\

FKDUJHUVSRZHUHGIURPWKH36:HOHFWULFDOV\\VWHP



7KH66)LVFDSDEOHRIPDLQWDLQLQJWKH66'FRQGLWLRQIURPWKH66)&57KH66)

SRZHUV\\VWHPLQFOXGHV9$&9$&9$&9$&DQG9'&

SRZHU,WFRQVLVWVRIVZLWFKJHDUD/&0&&VSDQHOERDUGVUHPRWHVWDUWHUV

EDWWHULHVEDWWHU\\FKDUJHUVLQYHUWHUVD'*>GLHVHOJHQHUDWRU@UHOD\\VFRQWURO

GHYLFHVDQGLQWHUFRQQHFWLQJFDEOHVXSSO\\LQJWKHDSSURSULDWHORDGV7KH66)

SRZHUV\\VWHPSURYLGHVHOHFWULFDOLVRODWLRQRI66)HTXLSPHQWIURPQRQ66)

HTXLSPHQW7KH66)9'&SRZHUV\\VWHPSURYLGHVDUHOLDEOHVRXUFHRI

SRZHUIRU'&ORDGVQHHGHGWREODFNVWDUWWKH'*7KH'&SRZHUV\\VWHP

FRQVLVWVRIWZR9'&EDWWHULHVDQGDVVRFLDWHGFKDUJHUVWZR9'&

GLVWULEXWLRQFHQWHUV '&6)'&6) DQGD'&SRZHUSDQHOERDUG '&6) 7KH

66)SRZHUV\\VWHPLVSURYLGHGZLWKVWDQGE\\SRZHUIURPDGHGLFDWHG'*



LWKWKHXQLW V EHLQJPDLQWDLQHGLQD66'FRQGLWLRQWKHUHLVQRLPPHGLDWHQHHG

IRUSODQWFRROGRZQ'DPDJHUHSDLUJXLGHOLQHVZLOOFRQWLQXHWREHFUHGLWHGWR

UHVWRUHSRZHUWRV\\VWHPVDQGFRPSRQHQWVQHHGHGIRUSODQWFRROGRZQWR&6'

FRQGLWLRQV$VSDUWRIWKHGDPDJHUHSDLUSURFHGXUHVDSRUWDEOHYDOYHFRQWURO

SDQHOZRXOGEHLQVWDOOHGDQGZLUHGWRDOORZFORVXUHRIWKHFRUHIORRGRXWOHWYDOYHV

&) &) ZKHQFRQGLWLRQVSHUPLWWKHLUFORVXUH,QDGGLWLRQWKHSRUWDEOH

YDOYHFRQWUROSDQHOZRXOGDOORZWKHRSHQLQJRIWKHGHFD\\KHDWGURSOLQHLVRODWLRQ

YDOYHV /3 /3 ZKHQHQWU\\FRQGLWLRQVIRUQRUPDO'+5DUHHVWDEOLVKHG



6RPH(6HTXLSPHQWPD\\EHORVWGXHWRSRVVLEOHIORRGLQJLQVLGHWKH7%

EDVHPHQWVSHFLILFDOO\\WKH/36:SXPSV7KH/36:SXPSVIRUDOOWKUHHXQLWV

DUHORFDWHGLQWKH7%EDVHPHQW6RPHSRVWXODWHG+(/%VLQVLGHWKH7%PD\\

UHVXOWLQUXSWXUHVWRWKH&&:SLSLQJ(6HTXLSPHQW +3,DQG/3, ORFDWHGLQVLGH

WKH$%DUHSURWHFWHGIURPWKHHIIHFWVRIIORRGLQJLQVLGHWKH7%E\\WKHH[LVWLQJ

IORRGSURWHFWLRQPHDVXUHVEDUULHUVDQGWKH7%GUDLQORFDWHGDWWKHVRXWKHQGRI

WKH7%7KH():SXPSVDOWKRXJKQRWFODVVLILHGDV(6HTXLSPHQWDUHDOVR

ORFDWHGLQWKH7%EDVHPHQW7%IORRGLQJFDQUHVXOWLQWKHORVVRI/36:DQG

():RQDOOWKUHHXQLWV'DPDJHUHSDLUJXLGHOLQHVDUHFUHGLWHGWRUHVWRUHWKH

/36:6\\VWHPVRQFHWKHVRXUFHRIIORRGLQJKDVEHHQLVRODWHGWRHQDEOHDSODQW

FRROGRZQWR&6'FRQGLWLRQV5HSODFHPHQWPRWRUVDQGDVVRFLDWHGFDEOLQJIRU

WKH/36:SXPSVDUHVWRUHGLQDSURWHFWHGZDUHKRXVH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











6$)VDUHQRWSRVWXODWHGLQHVWDEOLVKLQJSODQWFRROGRZQDQGWKHHVWDEOLVKPHQWRI

&6'



$OWKRXJKFHUWDLQQRUPDOO\\HVVHQWLDOVXSSRUWV\\VWHPVPD\\EHORVWDVDUHVXOWRIWKH

HQYLURQPHQWDOHIIHFWVRISRVWXODWHG+(/%VWKHOLFHQVHHPDLQWDLQVDFFHSWDEOHDOWHUQDWH

FDSDELOLW\\ LHWKH36:V\\VWHPDQG66) WKDWLVSURWHFWHGIURPWKHHIIHFWVRIWKHSRVWXODWHG

+(/%VWKDWWKH36:V\\VWHPDQG66)DUHFUHGLWHGWRPLWLJDWH7KH15&VWDIIILQGVWKHDERYH

VWUDWHJ\\VXIILFLHQWWRDGGUHVV*LDPEXVVR6FKZHQFHU,WHP





+DELWDELOLW\\,PSDFWVRQWKH&RQWURO5RRP



  • LDPEXVVR6FKZHQFHU,WHPVSHFLILHVWKDWDVVXUDQFHEHSURYLGHGWKDWWKH&5ZLOOEH

KDELWDEOHDQGLWVHTXLSPHQWIXQFWLRQDODIWHUD06RU0)':OLQHEUHDNRUWKDWWKHFDSDELOLW\\IRU

VKXWGRZQDQGFRROGRZQRIWKHXQLW V ZLOOEHDYDLODEOHLQDQRWKHUKDELWDEOHDUHD



7KH&5V&65VDQGHOHFWULFDOHTXLSPHQWURRPVDUHSURYLGHGZLWKDLUFRQGLWLRQLQJV\\VWHPV

GHVFULEHGLQ8)6$56HFWLRQWRPDLQWDLQDVXLWDEOHHQYLURQPHQWIRUSHUVRQQHODQG

HTXLSPHQW&KLOOHGZDWHULVVXSSOLHGWRWKH+9$&V\\VWHPVIURPWKH&5YHQWLODWLRQFKLOOHGZDWHU

V\\VWHPDVGHVFULEHGLQ8)6$56HFWLRQ(OHFWULFDOSRZHUWRWKH+9$&V\\VWHPVDVZHOODV

WKHFKLOOHGZDWHUV\\VWHPLWVHOILVYXOQHUDEOHWRWKHHIIHFWVRI+(/%VLQVLGHWKH7%)ROORZLQJD

+(/%LQWKH7%WKDWUHVXOWVLQDORVVRIFRROLQJWRWKH&5V&65VDQGHOHFWULFDOHTXLSPHQW

URRPVWKHOLFHQVHHVWDWHGWKDWDQDOWHUQDWHFRROLQJV\\VWHPZRXOGEHSODFHGLQRSHUDWLRQWR

HQVXUHWKDWWKHVHDUHDVUHPDLQKDELWDEOH7KHDOWHUQDWHFRROLQJV\\VWHPLVORFDWHGRXWVLGHWKH

7%DQGZRXOGUHPDLQIUHHRI+(/%GDPDJH



7KHOLFHQVHHGHWHUPLQHGWKDWSRVWXODWHG06DQG0)':OLQHEUHDNVLQVLGHWKH(35GRQRW

UHVXOWLQDGLUHFWORVVRI&5KDELWDELOLW\\EXW&5KDELWDELOLW\\PD\\EHVXEMHFWWRLQGLUHFW

GHJUDGDWLRQWKURXJKWKHIDLOXUHRIEORFNZDOOVVHSDUDWLQJWKH&5GXFWZRUNIURPWKH(357KH

LQWHJULW\\RIWKH&5LVSURWHFWHGE\\DUHLQIRUFHGFRQFUHWHZDOOEHWZHHQLWDQGWKH(35KRZHYHU

WKH&5+9$&V\\VWHPGXFWZRUNVHUYLQJWKH8QLWDQG&5LVSDUWLDOO\\ORFDWHGLQVLGHDGXFW

VKDIWDGMDFHQWWRWKH(357KHXQUHLQIRUFHGPDVRQU\\ZDOOVRIWKHGXFWVKDIWPD\\FUDFNDQG

SRWHQWLDOO\\IDLOGXHWRWKHFRPSDUWPHQWDOSUHVVXUL]DWLRQHIIHFWVIROORZLQJHLWKHUD06RU0)':

+(/%SRVWXODWHGLQVLGHWKH(357KH&65LVDOVRSURWHFWHGE\\DFRPELQDWLRQRI+(/%EODVW

ZDOOVDQGGRRUVDVZHOODVDUHLQIRUFHGFRQFUHWHZDOOEHWZHHQLWDQGWKH(35+RZHYHUWKH

+9$&GXFWZRUNVHUYLQJWKH&65KDVDGLVFKDUJHUHJLVWHULQWRWKHVWDLUZHOODGMDFHQWWRWKH

(35DQGWKHOLFHQVHHGHWHUPLQHGWKDWDQXQUHLQIRUFHGPDVRQU\\ZDOOVHSDUDWLQJWKHVWDLUZHOO

IURPWKH(35PD\\FUDFNDQGSRWHQWLDOO\\IDLOGXHWRWKHFRPSDUWPHQWDOSUHVVXUL]DWLRQHIIHFWV

IROORZLQJHLWKHUD06RU0)':+(/%SRVWXODWHGLQVLGHWKH(35$IDLOXUHRIWKLVZDOOFRXOGILOO

WKHVWDLUZHOOZLWKVWHDPIURPWKHSRVWXODWHG+(/%VLQVLGHWKH(357KHGLVFKDUJHUHJLVWHUWR

WKHVWDLUZHOOLVHTXLSSHGZLWKDILUHGDPSHUWKDWVKRXOGFORVHLILWZHUHVXEMHFWHGWRDVWHDP

HQYLURQPHQWEXWWKLVFDSDELOLW\\GRHVQRWVDWLVI\\WKHDSSOLFDEOHGHVLJQEDVLV)XUWKHUPRUHIRU

8QLWVDQGWKH+9$&V\\VWHPVHUYLQJWKHHOHFWULFDOHTXLSPHQWURRPZKLFKLVGLUHFWO\\EHORZ

WKH&65XVHVWKHVDPHGXFWVKDIWWKDWLVDGMDFHQWWRWKH(35,Q$WWDFKPHQWWRWKHVXEPLWWDO

GDWHG$XJXVWWKHOLFHQVHHLGHQWLILHGFRQIRUPLQJPRGLILFDWLRQVWRWKH&5&65DQG

HOHFWULFDOHTXLSPHQWURRP WKHFRQWUROFRPSOH[ FRROLQJV\\VWHPVIRUDOOWKUHHXQLWVWKDWDGGUHVV

WKHSRWHQWLDOIRULQGLUHFWHIIHFWVRQWKHFRQWUROFRPSOH[WKURXJKWKHDERYHGHVFULEHG

LQWHUDFWLRQV



7KHFRQWUROFRPSOH[IRUHDFKXQLWLVSURWHFWHGIURPGLUHFW+(/%HIIHFWVDQGWKHOLFHQVHHKDV

SURSRVHGFRQIRUPLQJPRGLILFDWLRQVWRWKHFRROLQJV\\VWHPVWKDWDGGUHVVWKHSRWHQWLDOIRULQGLUHFW

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











HIIHFWV%DVHGRQWKHDERYHWKH15&VWDIIILQGVWKDWOLFHQVHH¶VUHVSRQVHLVVXIILFLHQWWR

DGGUHVV*LDPEXVVR6FKZHQFHU,WHP



(QYLURQPHQWDO4XDOLILFDWLRQDQG(OHFWULFDO5HYLHZ

  • LDPEXVVR6FKZHQFHU,WHPUHTXHVWHGWKDW(4RIHTXLSPHQWWKDWPXVWIXQFWLRQDIWHU

H[SRVXUHWRWKHLQGLUHFWHIIHFWVRISLSHEUHDNEHGHPRQVWUDWHG7KH15&VWDIIHYDOXDWHG

ZKHWKHUHOHFWULFDOHTXLSPHQWDQGFRPSRQHQWVZRXOGUHPDLQERXQGHGE\\WKHH[LVWLQJ(4GXHWR

WKHSURSRVHGFKDQJHVLQ06DQG0)':+(/%PLWLJDWLRQ



7KHOLFHQVHHVWDWHGLQ$WWDFKPHQWRILWVVXEPLWWDOGDWHG$XJXVWWKDWHQYLURQPHQWDO

SURILOHVZHUHHYDOXDWHGIRUWKH0)':DQG06+(/%VSRVWXODWHGWRRFFXULQWKH7%DQG(35RI

WKH$%6SHFLILFDOO\\WKHOLFHQVHHVWDWHGWKDWWKHWHPSHUDWXUHDQGSUHVVXUHSURILOHVIRU

FRPSRQHQWVLQVLGHWKH(35DQG:35URRPVZHUHFKDQJHG7KHOLFHQVHHSURYLGHGDOLVWRIWKH

FRPSRQHQWVWKDWZHUHLPSDFWHGE\\WKHSURSRVHGFKDQJHVLQ$WWDFKPHQW7KH15&VWDII

GHWHUPLQHGWKDWSHUIRUPLQJDQDXGLWZDVQHFHVVDU\\WRYHULI\\NH\\DVVXPSWLRQVDQDO\\VHVDQG

WHVWUHSRUWVXVHGWRVXSSRUWWKHEDVLVIRUWKH/$57KH15&VWDIIVHOHFWHGDUHSUHVHQWDWLYH

VDPSOHRIHOHFWULFDOFRPSRQHQWVLQWKHOLFHQVHH¶V(4SURJUDPWRDXGLWEDVHGRQDULVNLQIRUPHG

DSSURDFK7KH15&VWDIIVHOHFWHGWKHUHSUHVHQWDWLYHVDPSOHIURPDOLVWRIFRPSRQHQWVDIIHFWHG

E\\WKHSURSRVHGFKDQJHVEDVHGRQULVNVLJQLILFDQFHDQGLPSRUWDQFHWRGHIHQVHLQGHSWK7KH

15&VWDIIUHYLHZHGGRFXPHQWVDQGFRQILUPHGWKDWWKHVHOHFWHGFRPSRQHQWVUHPDLQTXDOLILHGDV

DUHVXOWRIWKHQHZHQYLURQPHQWDOSURILOHVDVGRFXPHQWHGLQWKHDXGLWUHSRUWGDWHG1RYHPEHU

 5HIHUHQFH 



7KHOLFHQVHHH[SODLQHGLQ$WWDFKPHQWRILWVVXEPLWWDOGDWHG$XJXVWWKDWWKHFDEOLQJ

IURPLQVWUXPHQWVIRUWKH536DQG(6V\\VWHPDUHURXWHGWKURXJKWKHSHQHWUDWLRQURRPVWRWKH

&657KHOLFHQVHHIXUWKHUVWDWHGWKDWWKHHOHFWULFDOSHQHWUDWLRQVDQGWKHDVVRFLDWHGFDEOLQJIRU

WKHLQVWUXPHQWVDUHTXDOLILHGIRUWKHHQYLURQPHQWDOFRQGLWLRQVLQVLGHWKHSHQHWUDWLRQURRPDQG

WKHVHFDEOHVDUHQRWDGYHUVHO\\LPSDFWHGE\\DQ\\SRVWXODWHG+(/%VLQWKHSHQHWUDWLRQURRP$V

GRFXPHQWHGLQWKHDXGLWUHSRUWWKH15&VWDIIUHYLHZHGWKH(4RIWKHFDEOHVDQGHOHFWULFDO

SHQHWUDWLRQDVVHPEOLHVDQGFRQILUPHGWKDWWKHFRPSRQHQWVUHPDLQTXDOLILHGDVDUHVXOWRIWKH

SURSRVHGFKDQJHV LHWHPSHUDWXUHDQGSUHVVXUHFKDQJHV 



7KHOLFHQVHHH[SODLQHGLQ$WWDFKPHQWWKDWWKH&ODVV(HOHFWULFDOV\\VWHPPD\\EHGDPDJHGE\\

SRVWXODWHG+(/%VLQVLGHWKH7%7KHOLFHQVHHIXUWKHUVWDWHGWKDWWKHHIIHFWZRXOGEHVLPLODUWR

DQ6%2DVVXFK66'FDQEHDFKLHYHGWKURXJKWKH36:V\\VWHPDQGWKH66)8)6$5

7DEOHDGGUHVVHVWKHORVVRI9$&PDLQIHHGHUEXVHV9$&VWDQGE\\SRZHUEXVHV

DQGIHHGHUFLUFXLWEUHDNHUVDQG9$&DX[LOLDU\\VZLWFKJHDUEXVVHFWLRQVDQGLQGLFDWHVWKDW

WKHUHZRXOGEHQRFRQVHTXHQFHVLQFHWKHUHDUHUHGXQGDQWV\\VWHPV8)6$56HFWLRQ

QRWHVWKDWXSRQORVVRIWKHQRUPDOVRXUFHRISRZHUWRWKH9$&PDLQIHHGHUEXVHV

VWDQGE\\SRZHULVDYDLODEOHIURPWKH.HRZHHK\\GURHOHFWULFXQLWVRUVXSSOLHGIURPWKHNLORYROW

N9 WUDQVPLVVLRQOLQHKHQFHWKHUHDUHVWDQGE\\VRXUFHVRISRZHUDYDLODEOHXSRQORVVRIWKH

QRUPDOVRXUFHRISRZHUIRUWKH9$&V\\VWHP8)6$56HFWLRQLQGLFDWHVWKDWWKH

DOWHUQDWH$&SRZHUVRXUFHWKH66)'*ZRXOGEHDYDLODEOHZLWKLQPLQXWHV,Q8)6$5

6HFWLRQWKHOLFHQVHHVWDWHGWKDWWKH66)HOHFWULFDOSRZHUV\\VWHPVXSSOLHVSRZHU

QHFHVVDU\\WRPDLQWDLQWKHUHDFWRURIHDFKXQLWLQDQ66'FRQGLWLRQLQWKHHYHQWRIORVVRISRZHU

IURPDOORWKHUSRZHUV\\VWHPV7KXVWKHUHZRXOGQRWEHDORVVRIIXQFWLRQIRUWKHHOHFWULFDO

V\\VWHPDVWKHUHLVUHGXQGDQF\\DVZHOODVEDFNXSDQGVWDQGE\\SRZHUVRXUFHVDYDLODEOH

LQFOXGLQJWKH66)DQGWKH36:V\\VWHP

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











%DVHGRQLWVUHYLHZRIWKHLQIRUPDWLRQLQWKH/$5DQGLWVFRQILUPDWLRQE\\DXGLWWKDWWKH(4RI

HOHFWULFDOHTXLSPHQWUHPDLQVERXQGHGWKH15&VWDIIILQGVWKDWWKHSURSRVHGFKDQJHVZLOOKDYH

QRDGYHUVHLPSDFWRQWKHOLFHQVHH¶V(43URJUDPDQGWKHUHIRUHWKHOLFHQVHHVXIILFLHQWO\\

DGGUHVVHG,WHPRIWKH*LDPEXVVR6FKZHQFHUOHWWHU





,QVSHFWLRQ3URJUDP



  • LDPEXVVR6FKZHQFHU,WHPVSHFLILHVWKDWDGHVFULSWLRQEHSURYLGHGRIWKHTXDOLW\\FRQWURO

DQGLQVSHFWLRQSURJUDPWKDWZLOOEHUHTXLUHGRUKDVEHHQXWLOL]HGIRUSLSLQJV\\VWHPVRXWVLGH

FRQWDLQPHQW



7RDGGUHVVWKLVLWHPWKHOLFHQVHHVWDWHGWKDWLWKDVLQVWLWXWHGDQLQVSHFWLRQSURJUDPWKDW

HQVXUHVWKDWWKHJLUWKDQGDFFHVVLEOHDWWDFKPHQWZHOGVRIWKH06DQG0)':SLSLQJLQWKH$%

DUHLQVSHFWHGDWOHDVWRQFHGXULQJHDFK\\HDULQVHUYLFHLQVSHFWLRQLQWHUYDORI$60(&RGH

6HFWLRQ;,7KHOLFHQVHHH[DPLQHVWKHJLUWKZHOGVIRULQWHUQDOZHOGIODZVDQGZHOGWKLFNQHVV

7KHDWWDFKPHQWZHOGVDUHLQVSHFWHGIRUVXUIDFHLQGLFDWLRQV7KHOLFHQVHHDOVRVWDWHGWKDWLWKDV

FRPSOHWHGWKHLQLWLDOLQVSHFWLRQVRIWKH06DQG0)':JLUWKDQGDWWDFKPHQWZHOGVORFDWHGLQWKH

$%



,QDGGLWLRQWKHOLFHQVHHLQVSHFWHGWKHDFFHVVLEOHWHUPLQDOHQGZHOGVLQVLGHWKHUHVSHFWLYH

UXSWXUHUHVWUDLQWJXDUGSLSHRQWKHµ$¶DQGµ%¶0)':WUDLQV7KHOLFHQVHHKDVLQLWLDWHGD

SURJUDPWRLQVSHFWWKHVHWHUPLQDOHQGZHOGVGXULQJHDFK\\HDULQVHUYLFHLQVSHFWLRQLQWHUYDORI

$60(&RGH6HFWLRQ;,7KHOLFHQVHHKDVLQFOXGHGWKHLQVSHFWLRQVRIWKHSLSLQJEDVHPHWDO

GRZQVWUHDPRIWKHUHVSHFWLYH0)':LVRODWLRQYDOYHVZLWKLQWKHZHOGLQVSHFWLRQSURJUDPRUWKH

VWDWLRQ¶VIORZDFFHOHUDWHGFRUURVLRQLQVSHFWLRQSURJUDP



LWKUHVSHFWWRSRVWXODWHGFULWLFDOFUDFNVWKHOLFHQVHHVWDWHGWKDWLWZRXOGLPSOHPHQWDQ

LQVSHFWLRQSURJUDPWKDWHQVXUHVWKDWFULWLFDOFUDFNVORFDWHGDWZHOGVDQGLQWKHEDVHPHWDODZD\\

IURPZHOGVIRURWKHU+(OLQHVORFDWHGLQWKH$%UHFHLYHDQLQVSHFWLRQDWOHDVWRQFHGXULQJ

HDFK\\HDULQVHUYLFHLQVSHFWLRQLQWHUYDO7KHOLFHQVHHKDVGHWHUPLQHGWKDWQRFULWLFDOFUDFN

ORFDWLRQVDWZHOGVRUDWEDVHPHWDOORFDWLRQVDZD\\IURPZHOGVIRURWKHU+(OLQHVH[LVWLQWKH$%

DQGWKHUHIRUHVXFKDQLQVSHFWLRQSURJUDPLVQRWQHHGHGDWWKLVWLPH



7KHOLFHQVHHVWDWHGWKDWHDFK0)':JXDUGSLSHHQFORVHVWKHSRVWXODWHG0)':EUHDN

ORFDWLRQ V 7KHOLFHQVHHLGHQWLILHGLQDFFHVVLEOHJLUWKZHOGVRQDQHOERZWKDWDUHHQFORVHGE\\

WKH0)':JXDUGSLSHVDGMDFHQWWRWKH5%SHQHWUDWLRQVDQG7KHJXDUGSLSHVIRUP

SDUWRIWKH0)':UXSWXUHUHVWUDLQWV7KHOLFHQVHHDOVRH[SODLQHGWKDWWKHLQDFFHVVLEOHJLUWK

ZHOGVDUHSUHVHQWLQ8QLWVDQGEXWQRWLQ8QLW)RU8QLWVDQGWKHOLFHQVHH

YROXPHWULFDOO\\LQVSHFWHGWKHDFFHVVLEOHSRUWLRQRIWKHHOERZJLUWKZHOGLQWKH0)':$DQG%

KHDGHU V RQFHGXULQJHDFK\\HDULQVHUYLFHLQVSHFWLRQLQWHUYDO7KH8QLWKHDGHUVFRQWDLQ

QRVXFKHOERZVDQGDVVXFKWKHUHDUHQRJLUWKZHOGVHQFORVHGE\\WKH0)':UXSWXUHUHVWUDLQW

JXDUGSLSH7KHOLFHQVHHIXUWKHUVWDWHGWKDWEHFDXVHWKHVHHOERZJLUWKZHOGVDUHDGMDFHQWWR

WKHSRVWXODWHGEUHDNORFDWLRQLQVLGHWKHJXDUGSLSHDEUHDNDWWKHLQDFFHVVLEOHZHOG V ZRXOG

UHVXOWLQQRJUHDWHUFRQVHTXHQFHVWKDQWKRVHWKDWZRXOGRFFXUIRUEUHDN V SUHYLRXVO\\

SRVWXODWHGLQVLGHWKHJXDUGSLSH



7KH15&VWDIIILQGVWKDWWKHOLFHQVHHKDVLGHQWLILHGWKHUHOHYDQWZHOGVLQWKH06DQG0)':OLQH

RXWVLGHRIFRQWDLQPHQWLQ8QLWVDQGWKDWDUHUHTXLUHGWREHLQVSHFWHG7KHOLFHQVHH

SURYLGHGWKHLGHQWLILFDWLRQQXPEHUVRIWKHZHOGVZHOGW\\SHKHDGHU $RU% DQGLQVSHFWLRQ

PHWKRG XOWUDVRQLFWHVWLQJRUSHQHWUDQWWHVWLQJ 7KH15&VWDIIQRWHVWKDWWKHOLFHQVHHKDV

SHUIRUPHGWKHLQLWLDOLQVSHFWLRQVRIWKHVHZHOGV%DVHGRQLWVUHYLHZWKH15&VWDIIGHWHUPLQHG

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











WKDWWKHOLFHQVHHDGHTXDWHO\\GHVFULEHGWKHSURJUDPVWKDWH[DPLQHWKHVHZHOGVDQGEDVHPHWDOV

LQWKHIXWXUHLQVHUYLFHLQVSHFWLRQLQWHUYDOVLQFOXGLQJWKHH[DPLQDWLRQVVSHFLILHGLQWKHZHOGDQG

IORZDFFHOHUDWHGFRUURVLRQLQVSHFWLRQSURJUDPV%DVHGRQWKHDERYHWKH15&VWDIIILQGVWKDW

WKHOLFHQVHHVXIILFLHQWO\\DGGUHVVHG*LDPEXVVR6FKZHQFHU,WHP





15&6WDII&RQFOXVLRQ5HJDUGLQJ+(/%0LWLJDWLRQ6WUDWHJ\\



7KH15&VWDIIGHWHUPLQHGWKDWWKHOLFHQVHHLGHQWLILHGDSSURSULDWHV\\VWHPVWRSURYLGHLQLWLDO

PLWLJDWLRQIRUSRVWXODWHG+(/%VWKDWDUHSURWHFWHGIURPWKHHIIHFWVRIWKH+(/%E\\VHSDUDWLRQRU

GHVLJQHGWRZLWKVWDQGWKHHIIHFWVRIWKH+(/%7KH15&VWDIIEDVHGWKLVGHWHUPLQDWLRQRQWKH

UHYLHZRISODQWGUDZLQJVWKHDXGLWRIDVVHVVPHQWVDQGFDOFXODWLRQVDQGWKHUHYLHZRIWKH/$5

7KH15&VWDIIILQGVWKDWSURSRVHGDOWHUQDWH66'FDSDELOLWLHV LHWKH66)DQG36:V\\VWHPV 

KDYHUHOLDELOLW\\DQGWHVWDELOLW\\FRPPHQVXUDWHZLWKWKHORZOLNHOLKRRGRIPDMRU7%+(/%VWKDW

ZRXOGQHFHVVLWDWHWKHLUXVH7KHUHSDLURISRWHQWLDOGDPDJHWRWKH/36:V\\VWHPDQG

VXSSRUWLQJHOHFWULFDOGLVWULEXWLRQWRVXSSRUWSODFLQJWKHXQLWVLQ&6'LVDFFHSWDEOHFRQVLGHULQJ

WKHORZOLNHOLKRRGRIPDMRU7%+(/%VWKDWZRXOGGDPDJHWKHVHV\\VWHPVDQGWKHFRQWLQXDOO\\

GHFUHDVLQJVHFRQGDU\\'+5ZDWHUUHTXLUHPHQWV)XUWKHUPRUHWKH15&VWDIIILQGVWKDWH[LVWLQJ

HTXLSPHQWWKHVFKHGXOHIRUFRQIRUPLQJPRGLILFDWLRQVDQGSURFHGXUHFKDQJHVWRLGHQWLI\\7&$V

ZRXOGSURYLGHDFFHSWDEOHDQGUHDVRQDEO\\WLPHO\\DVVXUDQFHRIGHIHQVHLQGHSWKIRUPLWLJDWLRQRI

SRVWXODWHG+(/%V7KHUHIRUHWKH15&VWDIIFRQFOXGHVWKDWWKHSURSRVHGILQDO+(/%VWUDWHJ\\LV

DFFHSWDEOH





7KHUPDO+\\GUDXOLF$QDO\\VLV



7KHSXUSRVHRIWKH5&6WKHUPDOK\\GUDXOLF 7+ DQDO\\VHVLVWRHYDOXDWHDQGFRQILUPPLWLJDWLRQ

RI+(/%VDQG66'RIUHDFWRUVIROORZLQJ+(/%VSRVWXODWHGWRRFFXULQWKH7%DQGWKH(35RI

WKH$%7KHV\\VWHPVXVHGIRUWKLVSXUSRVHDUHHLWKHUWKHQRUPDOSODQWV\\VWHPV66)RU36:

V\\VWHPGHSHQGLQJRQWKHLUDYDLODELOLW\\GXULQJWKH+(/%VFHQDULR



7KHOLFHQVHHSHUIRUPHG7+DQDO\\VHVIRUWKH+(/%VFHQDULRVWKDWUHVXOWLQ5&6RYHUKHDWLQJ

GXULQJWKH0)':+(/%VFHQDULRVDQG5&6RYHUFRROLQJGXULQJWKH06+(/%VFHQDULRV7KH

DQDO\\VHVHYDOXDWHWKHUHVSRQVHRIWKH216XQLWH[SHULHQFLQJD+(/%WRHDFKRIWKHVFHQDULRV

LQHVWDEOLVKLQJWKHKHDWUHPRYDOIURPWKH5&6E\\WKH6*VXVLQJWKHQRUPDOSODQWV\\VWHPV66)

HTXLSPHQWRUWKH36:V\\VWHP7KHSXUSRVHRIWKH7+DQDO\\VHVLVWRGHPRQVWUDWHWKDWIRUWKH

VFHQDULRDQDO\\]HGWKHFUHGLWHGV\\VWHPVPHHWWKHSURSRVHG+(/%PLWLJDWLRQDFFHSWDQFHFULWHULD

JLYHQLQ6HFWLRQEHORZDQGWKH66'RIWKHUHDFWRULVDFKLHYHG



7RFRQILUPWKDWWKHDFFHSWDQFHFULWHULDLVPHWWKHOLFHQVHHDQDO\\]HGWKH+(/%VFHQDULRVE\\

XVLQJWKHIROORZLQJPHWKRGRORJLHV D 5(/$302'% :216PRGHOGRFXPHQWHGLQ15&

DSSURYHGWRSLFDOUHSRUW 75 '3&1(3$ 5HIHUHQFH  E 5(75$1'216PRGHO

GRFXPHQWHGLQ15&DSSURYHG75V'3&1(3$ 5HIHUHQFH '3&1(3$

5HIHUHQFH DQG'3&1(3$ 5HIHUHQFH  F 6LPXODWH. 6. DQG6LPXODWH3

63 PHWKRGRORJLHVGRFXPHQWHGLQ15&DSSURYHG75V'3&1(3$ 5HIHUHQFH 

'3&1(3$ 5HIHUHQFH DQG1)6$ 5HIHUHQFH DQG G 9HUVDWLOH,QWHUQDOV

DQG&RPSRQHQW3URJUDPIRU5HDFWRUV(OHFWULF3RZHU5HVHDUFK,QVWLWXWH (35,  9,35( 

PHWKRGRORJ\\GRFXPHQWHGLQ15&DSSURYHG75'3&1(3$ 5HIHUHQFH 

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21













+(/%0LWLJDWLRQ$FFHSWDQFH&ULWHULD



+(/%PLWLJDWLRQUHTXLUHVDQ66'RIWKHUHDFWRUZKLOHWKHUHDFWRU5&6DQG6*VUHPDLQZLWKLQ

WKHLUGHVLJQOLPLWV7KHOLFHQVHHVSHFLILHGWKHIROORZLQJDFFHSWDQFHFULWHULDIRUWKH5&6

RYHUKHDWLQJDQG5&6RYHUFRROLQJ7+DQDO\\VHV





5&62YHUKHDWLQJ$QDO\\VLV$FFHSWDQFH&ULWHULDIRU0)':+(/%V



x

7KHFRUHPXVWUHPDLQLQWDFWDQGLQDFRRODEOHFRUHJHRPHWU\\

x

0LQLPXPGHSDUWXUHIURPQXFOHDWHERLOLQJUDWLR '1%5 PHHWVVSHFLILHGDFFHSWDEOHIXHO

GHVLJQOLPLWV

x

5&6SUHVVXUHPXVWQRWH[FHHGSVLJ SHUFHQWRIGHVLJQSUHVVXUH 



7KH15&VWDIIILQGVWKHDERYHFULWHULDDFFHSWDEOHEHFDXVHIRURYHUKHDWLQJRIWKH5&6WKHFRUH

VKRXOGUHPDLQLQWDFWDQGPDLQWDLQFRRODEOHJHRPHWU\\WKHPLQLPXP'1%5VKRXOGPHHWWKH

DFFHSWDEOHIXHOGHVLJQOLPLWVDQG5&6SUHVVXUHLQFUHDVHVKRXOGQRWH[FHHGGHVLJQSUHVVXUH





5&62YHUFRROLQJ$QDO\\VLV$FFHSWDQFH&ULWHULDIRU06+(/%V



x

7KH6*WXEHVUHPDLQLQWDFW

x

5&6UHPDLQVZLWKLQDFFHSWDEOHSUHVVXUHDQGWHPSHUDWXUHOLPLWV



7KH15&VWDIIILQGVWKHDERYHFULWHULDDFFHSWDEOHEHFDXVHIRUWKHRYHUFRROLQJRIWKH5&6WKH

SUHVVXUHWHPSHUDWXUHRIWKH5&6VKRXOGUHPDLQZLWKLQWKHVSHFLILHGOLPLWVDQG6*WXEHVWUHVVHV

VKRXOGUHPDLQZLWKLQWKHGHVLJQOLPLWVWRPDLQWDLQWKHWXEHVLQWDFW





7+$QDO\\VLV0HWKRGRORJ\\IRU0)':DQG06+(/%V



7KHOLFHQVHHXVHGWKH5(/$302'% :PHWKRGRORJ\\IRUWKH0)':+(/%VDVZHOODV

VRPHRIWKH06+(/%V7+DQDO\\VLVRIWKH5&68)6$56HFWLRQVWDWHVWKDWWKH

5(/$302'% :FRGHGHYHORSHGE\\$5(9$13LVXVHGIRUWKHEHVWHVWLPDWHDQG

OLFHQVLQJWUDQVLHQWVLPXODWLRQRISUHVVXUL]HGZDWHUUHDFWRUV 3:5V 7KHRULJLQDO

5(/$302'ZDVGHYHORSHGE\\WKH,GDKR1DWLRQDO(QJLQHHULQJ/DERUDWRU\\IRUWKH15&7KH

15&KDVDSSURYHGWKH5(/$302'% :PHWKRGRORJ\\LQWKH)UDPDWRPH13 UHQDPHGDV

$5(9$13 75%$:3$ 5HIHUHQFH 'XNH(QHUJ\\PRGLILHGWKH5(/$302'

% :PRGHOLQ75'3&1(3$DQGGHQRPLQDWHGLWDV5(/$302'% :2167KH

OLFHQVHHIXUWKHUHQKDQFHGWKH5(/$302'% :216E\\LQFOXGLQJWKHIROORZLQJIHDWXUHVWR

PDNHLWVXLWDEOHIRUWKHSURSRVHG+(/%DQDO\\VHV



 ,QFOXGHGWKHIROORZLQJIHDWXUHV



x

$PELHQWKHDWORVVHVIURPWKHSUHVVXUL]HUDIWHUWKHWLPHRISHDN5&6SUHVVXUH

x

,PSURYHGLWVFDSDELOLW\\WRPRGHOWKHUPDOVWUDWLILFDWLRQRIIOXLGLQWKHSUHVVXUL]HUUHJLRQ



 ,QDGGLWLRQWR  DERYHIRUWKHDQDO\\VLVRI+(/%LQ(35PLWLJDWLRQE\\WKHQRUPDOSODQW

V\\VWHPVDGGHGWKHIROORZLQJIHDWXUHV



x

3RUWLRQVRIWKHFRQGHQVDWHDQG0)':V\\VWHPSLSLQJWRUHSUHVHQWWKHIOXLGYROXPHV

x

/RRSKLJKSRLQWYHQWVDQG59KHDGYHQWPRGHOLQJ

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











 ,QDGGLWLRQWR  DERYHIRUWKHDQDO\\VLVRI+(/%LQ7%PLWLJDWLRQE\\WKHQRUPDOSODQW

V\\VWHPVDGGHGWKHIROORZLQJIHDWXUH



x

/RRSKLJKSRLQWYHQWVDQG59KHDGYHQWPRGHOLQJ



 ,QDGGLWLRQWR  DERYHIRUWKHDQDO\\VLVRI+(/%LQ7%PLWLJDWLRQE\\WKH66)DGGHGWKH

IROORZLQJIHDWXUHV



x

(OLPLQDWLRQRIWKH0)':SLSLQJWRFRQVHUYDWLYHO\\PLQLPL]HOLTXLGDGGHGWRWKH6*V

x

0RGHOLQJRIWKH66)OHWGRZQOLQH



 ,QDGGLWLRQWR  DERYHIRUWKHDQDO\\VLVRI+(/%PLWLJDWLRQE\\WKH36:V\\VWHPDGGHGWKH

IROORZLQJIHDWXUHV



x

(OLPLQDWLRQRIWKH0)':SLSLQJWRFRQVHUYDWLYHO\\PLQLPL]HOLTXLGDGGHGWRWKH6*V

x

/RRSKLJKSRLQWYHQWVDQG59KHDGYHQWPRGHOLQJ



7KHIROORZLQJVXEVHFWLRQVGHVFULEHWKHIHDWXUHVDGGHGE\\WKHOLFHQVHHLQWKH5(/$302'

% :216EDVHPRGHOIRUDPRUHUHDOLVWLFDQGRUFRQVHUYDWLYHDQDO\\VLV





$PELHQW+HDW/RVVHVIURPWKH3UHVVXUL]HU



7KHOLFHQVHHVWDWHGWKDWLQWKH5(/$302'% :216EDVHPRGHOWKHH[WHULRUKHDW

VWUXFWXUHVRQWKH5&6DQGSUHVVXUL]HUFRPSRQHQWVDUHPRGHOHG>>



@@7RPRGHOWKHDPELHQWKHDWORVVHVIURPWKH5&6WKHDVVRFLDWHGKHDWVWUXFWXUHV

DUHFRQYHUWHGWR>>





@@,QLWVUHVSRQVHWR5$,E\\OHWWHUGDWHG-XQH

WKHOLFHQVHHHYDOXDWHGWKHKHDWWUDQVIHUFRHIILFLHQWVE\\WHVWLQJGXULQJVWHDG\\VWDWH0RGH5&6

FRQGLWLRQVXVLQJPHDVXUHGYDOXHVRIKHDWLQSXW IURPKHDWHUYROWDJHFXUUHQWDQGSRZHU IRUDOO

RSHUDWLQJSUHVVXUL]HUKHDWHUVDFFRUGLQJWRSODQWSURFHGXUHV



LWKLQWKH5(/$302'% :216PRGHOVXVHGIRUWKH5&6RYHUKHDWLQJDQGRYHUFRROLQJ

DQDO\\VLVIRUD+(/%VFHQDULRPLWLJDWHGE\\QRUPDOSODQWHTXLSPHQWWKH66)RUWKH36:

V\\VWHPWKHDPELHQWKHDWORVVHVDUH>>



@@



&RQVLVWHQWZLWKWKHDSSURDFKLQ'3&1(3$ 5HIHUHQFH '3&1(3$

5HIHUHQFH DQG'3&1(3$ 5HIHUHQFH WKHOLFHQVHHGLGQRWPRGHODPELHQWKHDW

ORVVHVIURPRWKHU5&6VWUXFWXUHV7KH15&VWDIIILQGVWKLVFKDQJHLQWKH5(/$302'% :

216EDVHPRGHODFFHSWDEOHEHFDXVHWKHOLFHQVHHHQKDQFHGWKHH[LVWLQJPRGHOVE\\UHDOLVWLFDOO\\

PRGHOLQJWKHSUHVVXUL]HUKHDWORVVHV





59+HDG$[LDO&RQGXFWLRQ



7KH5(/$302'% :216EDVHPRGHOGRHVQRWFRQWDLQKHDWVWUXFWXUHVWRUHSUHVHQWWKH

LQWHUQDOPHWDOVWUXFWXUHVZLWKLQWKH59XSSHUKHDGQRGHV,QWKHQRGDOL]DWLRQVFKHPHJLYHQLQ

)LJXUHRI'3&1(3$WKH59XSSHUKHDGUHJLRQLVHIIHFWLYHO\\DGHDGHQGHG

YROXPH7KLVLVQRQSK\\VLFDOEHFDXVHWKHEXR\\DQF\\HIIHFWVZRXOGUHVXOWLQPL[LQJRIWKH5&6

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











IOXLGLQWKLVUHJLRQ,QLWVUHVSRQVHWR5$,E\\OHWWHUGDWHG-XQHWKHOLFHQVHHVWDWHG

WKDWLQWKH5&6RYHUFRROLQJDQDO\\VLVWRHOLPLQDWHWKHQRQSK\\VLFDOEHKDYLRUDWWULEXWHGWR

QRGDOL]DWLRQ>>



@@7KLVIHDWXUHLVQRWXVHGLQWKHRYHUKHDWLQJDQDO\\VLV



7KH15&VWDIIILQGVWKLVFKDQJHLQWKH5(/$302'% :216EDVHPRGHODFFHSWDEOHIRU

WKH5&6RYHUFRROLQJDQDO\\VLVEHFDXVHLWPLWLJDWHVWKHUPDOVWUDWLILFDWLRQLQDYRLGHG59KHDG

ZKLFKFDQGHYHORSGXHWRWKHDEVHQFHRID[LDOKHDWFRQGXFWLRQLQWKHEDVHPRGHO1RWXVLQJ

WKLVIHDWXUHLVFRQVHUYDWLYHIRUWKH5&6RYHUKHDWLQJDQDO\\VLV





3UHVVXUL]HU1RGDOL]DWLRQIRU7KHUPDO6WUDWLILFDWLRQ



,QWKH5(/$302'% :EDVHPRGHOWKHSUHVVXUL]HULVPRGHOHGZLWKODUJHKHLJKWQRGHV7R

LQFUHDVHWKHUHVROXWLRQRID[LDOWHPSHUDWXUHJUDGLHQWVWKHOLFHQVHH>>



@@DVZHOODVLPSURYHG

SUHGLFWLRQVRIWKHUPDOVWUDWLILFDWLRQRIWKHOLTXLGUHJLRQGXULQJLQVXUJHVRXWVXUJHVDQGODUJH

SUHVVXUHGURSV



7KHOLFHQVHHSURYLGHGWKHIROORZLQJUDWLRQDOHIRUWKLVFKDQJH



7KHSUHVVXUL]HUSOD\\VDVLJQLILFDQWUROHLQUHJXODWLQJ5&6SUHVVXUHGXULQJ

>RYHUKHDWLQJDQGRYHUFRROLQJ@WUDQVLHQWVDQGH[SHULHQFHVVHYHUDOLPSRUWDQW

SKHQRPHQDIRUERWKRYHUFRROLQJDQGRYHUKHDWLQJFRQGLWLRQV



,QJHQHUDOIRURYHUKHDWLQJVFHQDULRVWKHUHLVDQLQLWLDOLQVXUJHRIVXEFRROHG

OLTXLGLQWRWKHSUHVVXUL]HUIURPWKHUPDOH[SDQVLRQRIWKH5&6LQYHQWRU\\,IWKH

RYHUKHDWLQJWUDQVLHQWLVVKRUWOLYHGWKHSUHVHQFHRIVXEFRROHGOLTXLGLQWKH

SUHVVXUL]HUKDVOLWWOHLPSDFWRQWKHLPPHGLDWHUHVSRQVH7KLVLVEHFDXVHWKHUHLV

OLWWOHPL[LQJLQWKHIOXLGUHJLRQXQGHUWKHVHFRQGLWLRQVDQGEXR\\DQF\\ GHQVLW\\ 

HIIHFWVFDXVHWKHFROGHUOLTXLGLQWKHSUHVVXUL]HUWRUHPDLQQHDUWKHERWWRPRIWKH

YHVVHOZKLOHWKHKRWWHU RULJLQDOO\\VDWXUDWHG OLTXLGUHPDLQVQHDUWKHWRSRIWKH

ZDWHUFROXPQDQGLQFRQWDFWZLWKWKHYDSRUVSDFH7KHUPDOVWUDWLILFDWLRQRIWKH

SUHVVXUL]HUOLTXLGKHOSVOLPLWWKHDPRXQWRIVWHDPFRQGHQVDWLRQWKDWRFFXUVDWWKH

VWHDPOLTXLGLQWHUIDFHGXULQJWKHVHSUHVVXUHH[FXUVLRQV



)RU5&6RYHUFRROLQJWUDQVLHQWVVDWXUDWHGOLTXLGLQWKHSUHVVXUL]HUIODVKHVWR

VWHDPH[SDQGVDQGOLPLWVWKHGHSUHVVXUL]DWLRQUDWHRIWKH5&66XEVHTXHQWO\\

ZKHQWKHSUHVVXUL]HUUHILOOVLQVXUJHVRIVXEFRROHGOLTXLGWRWKHSUHVVXUL]HUFDQ

OLPLWWKHDELOLW\\RIWKHSUHVVXUL]HUWRUHJXODWHVXEVHTXHQWGHSUHVVXUL]DWLRQVRIWKH

5&6)RUPRUHVHYHUHRYHUFRROLQJVFHQDULRVWKHSUHVVXUL]HUPD\\HPSW\\DVD

UHVXOWRIWKHLQLWLDORYHUFRROLQJEXWVXEFRROHGOLTXLGZLOOUHILOOWKHSUHVVXUL]HURQFH

RSHUDWRUVUHVWRUH5&6SUHVVXUHRUSUHVVXUL]HUOHYHOWRWKHVSHFLILHGRSHUDWLQJ

UDQJH,QWKHORQJWHUPUHFRYHU\\SKDVHRSHUDWRUDFWLRQVWRVWDELOL]HSUHVVXUL]HU

OHYHODQGHQHUJL]HSUHVVXUL]HUKHDWHUVDOORZVWKHIOXLGLQWKHSUHVVXUL]HUWRUH

VDWXUDWHDQGUHVWRUH5&6SUHVVXUHWRDGHVLUHGUDQJH



)RUVFHQDULRVPLWLJDWHGZLWKOLPLWHGSUHVVXUL]HUKHDWHUFDSDFLW\\WKHDELOLW\\WRUH

VDWXUDWHWKHVXEFRROHGOLTXLGLQWKHSUHVVXUL]HULVJUHDWO\\GLPLQLVKHG

$GGLWLRQDOO\\SUHVVXUL]HUDPELHQWKHDWORVVHVFDQFDXVHFRQGHQVDWLRQRIWKH

YDSRUVSDFHRQLQWHUQDOVWUXFWXUDOVXUIDFHV&RQWLQXHGFRQGHQVDWLRQRIWKH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











YDSRUVSDFHOHDGVWRDUHGXFWLRQLQ5&6SUHVVXUHDQGLQFUHDVHVLQSUHVVXUL]HU

OHYHO$VWKHYDSRUVSDFHFROODSVHVWKHFRQWLQXDOLQVXUJHRIVXEFRROHGOLTXLG

FKDOOHQJHVWKHDELOLW\\RIWKHSUHVVXUL]HUKHDWHUVWRUHVDWXUDWHWKHIOXLG6KRXOG

WKHSUHVVXUL]HUHYHQWXDOO\\UHILOOWRDZDWHUVROLGFRQGLWLRQ5&6SUHVVXUHFRQWUROLV

SURYLGHGE\\EDODQFLQJPDNHXSDQGOHWGRZQIORZZLWKHLWKHUWKH66)OHWGRZQOLQH

SUHVVXUL]HU3259RUORRSKLJKSRLQWYHQWV



7KH15&VWDIIILQGVWKHOLFHQVHH¶VUDWLRQDOHIRU>>



@@LQWKH5(/$302'% :216EDVHPRGHODFFHSWDEOHEHFDXVHLWLVPRUH

UHDOLVWLFPRGHOLQJRIWKHKHDWWUDQVIHUZLWKLQWKHSUHVVXUL]HUIOXLGDQGIURPWKHSUHVVXUL]HUWRWKH

DPELHQW





0DLQ)HHGZDWHUDQG&RQGHQVDWH6\\VWHP1RGDOL]DWLRQ



7KH5(/$302'% :216EDVHPRGHOQRGDOL]DWLRQLQFOXGHVWKH0)':SLSLQJEHWZHHQ

WKHODVWFKHFNYDOYHDQGWKH6*,WLVFRQVHUYDWLYHWRPLQLPL]HWKHDPRXQWRI)':WKDWFDQ

HQWHUWKH6*VIRUWKH5&6RYHUKHDWLQJVFHQDULRVDQGPD[LPL]HWKHDPRXQWRI)':WKDWFDQ

HQWHUWKH6*VIRUWKH5&6RYHUFRROLQJVFHQDULRV



)RUWKH5&6RYHUKHDWLQJDQDO\\VLVRIWKH+(/%XSVWUHDPRIWKHODVW0)':FKHFNYDOYHWKH

OLFHQVHHFRQVHUYDWLYHO\\UHPRYHGWKH0)':SLSLQJLQFOXGHGLQWKH5(/$302'% :216

PRGHOWRPLQLPL]HOLTXLGDGGHGWRWKH6*V



)RUWKH():PLWLJDWHG5&6RYHUKHDWLQJDQDO\\VLVRIDEUHDNGRZQVWUHDPRIWKHODVW0)':

FKHFNYDOYHLQWKH(35WKHOLFHQVHHDGGHGWKHSRUWLRQVRIWKH0)':SLSLQJUHTXLUHGWR

DSSURSULDWHO\\PRGHOWKHIORZDQGEUHDNERXQGDU\\FRQGLWLRQV



)RUWKH5&6RYHUFRROLQJVFHQDULRVWKHOLFHQVHHDVVXPHGFRQVHUYDWLYHO\\WKDWWKH0)':

FRQWUROYDOYHVRSHQWRDOORZWKHPD[LPXPDPRXQWRI)':WRHQWHUWKH6*



7KH15&VWDIIILQGVWKHDERYHFKDQJHVLQWKH5(/$302'% :216EDVHPRGHO

DFFHSWDEOHEHFDXVHWKH\\ZRXOGUHVXOWLQFRQVHUYDWLYH5&6RYHUKHDWLQJDQGRYHUFRROLQJ

DQDO\\VHV





0DLQ6WHDP6\\VWHP1RGDOL]DWLRQ



7KH5(/$302'% :216EDVHPRGHOUHSUHVHQWVWKH06SLSLQJIURPWKH6*WRWKH

WXUELQHZLWKDVLQJOHYROXPH QRGH IRUHDFKORRS7KLVQRGDOL]DWLRQLVFRQVHUYDWLYHIRUWKH5&6

RYHUKHDWLQJDQDO\\VLVIRUWKH0)':+(/%VEHFDXVHWKHWXUELQHVWRSYDOYHVDUHLPPHGLDWHO\\

FORVHGXSRQEUHDNLQLWLDWLRQDQGWKHWXUELQHE\\SDVVYDOYHVDUHDVVXPHGWREHXQDYDLODEOHDQG

WKHUHIRUHDVLQJOHQRGHZRXOGPD[LPL]H5&6RYHUKHDWLQJ



)RU5&6RYHUFRROLQJVFHQDULRVWKHOLFHQVHHGHVFULEHGWKHFKDQJHLQWKH216EDVHPRGHODQG

LWVUDWLRQDOHDVIROORZV



)RURYHUFRROLQJVFHQDULRVDGGLWLRQDOSKHQRPHQDDUHSUHVHQWWKDWSRWHQWLDOO\\

LPSDFWWKHDELOLW\\WRUHPRYHKHDWIURPWKH6*V7KHVHSKHQRPHQDDUH

DVVRFLDWHGZLWKWKHUDSLGGHSUHVVXUL]DWLRQGXHWRSRVWXODWHG06SLSLQJEUHDNV

7KHUDSLGGHSUHVVXUL]DWLRQZLOOLQLWLDOO\\FDXVHDOLTXLGOHYHOVZHOODQGHQWUDLQPHQW

GXHWRKLJKVWHDPYHORFLWLHV7KH6*RXWOHWQR))OHVLQVWDOOHGLQWKH5HSODFHPHQW

2QFH7KURXJK6WHDP*HQHUDWRUV 276*V VHUYHWROLPLWWKHEORZGRZQPDVV

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











IORZUDWH(QWUDLQHGOLTXLGGURSOHWVLQWKHVWHDPIORZPD\\EHFRPHGHHQWUDLQHG

LQWKHYHUWLFDOSRUWLRQVRIWKHVWHDPOLQHSLSLQJGRZQVWUHDPRIWKH6*V0RGHOLQJ

WKHYHUWLFDOSLSLQJHQDEOHVDOLTXLGOHYHOLQWKLVVHFWLRQRIVWHDPOLQHWKDWFRXOG

LPSDFWFRQGLWLRQVZLWKLQWKH6*$GGLWLRQDOGHWDLOWKDWSUHVHUYHVIORZDUHDDQG

HOHYDWLRQFKDQJHLVLQFOXGHGLQWKHVWHDPOLQHQRGDOL]DWLRQXVHGIRUWKH+(/%

RYHUFRROLQJDQDO\\VLVWRDOORZWKHDQDO\\VLVWRFDSWXUHWKHVHHIIHFWV



7KH15&VWDIIILQGVWKHH[LVWLQJVLQJOHYROXPHQRGDOL]DWLRQLQWKH5(/$302'% :216

EDVHPRGHODFFHSWDEOHZLWKQRFKDQJHVEHFDXVHLWUHSUHVHQWVDFRQVHUYDWLYHDSSURDFKRIKHDW

WUDQVIHUDQGVWHDPUHOHDVHIURPWKH6*VIRUWKH5&6RYHUKHDWLQJVFHQDULRV



)RUWKH5&6RYHUFRROLQJDQDO\\VLVWKH15&VWDIIILQGVWKHFKDQJHLQWKH5(/$302'% :

216EDVHPRGHODFFHSWDEOHEHFDXVHLWFDSWXUHVWKHHIIHFWRIWKHHQWUDLQHGOLTXLGGURSOHWVLQWKH

VWHDPIORZWKDWPD\\EHFRPHGHHQWUDLQHGLQWKHYHUWLFDOSRUWLRQVRIWKHVWHDPOLQHVZKLFK

LQFUHDVHVKHDWWUDQVIHUFRQVHUYDWLYHO\\IURPWKH5&6WR6*VDQGWKHUHIRUHUHVXOWVLQDQ

LQFUHDVHG5&6RYHUFRROLQJ





6WHDP*HQHUDWRU0RGHOLQJ



7KH5(/$302'% :216EDVHPRGHOGHVFULEHVWKH6*PRGHOLQJDSSURDFK7KH

5(/$302'% :():KHDWWUDQVIHUPRGHOGHVFULEHGLQ%$:3$ 5HIHUHQFH LV

XVHGWRPRGHOIORZWKURXJKWKH6*XSSHUQR))OHVIRUWKH5&6RYHUKHDWLQJDQGRYHUFRROLQJ

DQDO\\VHV7KH6*XSSHUQR))OHVDUHXVHGE\\DYDULHW\\RIIORZVRXUFHVLQFOXGLQJ():66)

$6:DQG36:V\\VWHPIORZGHSHQGLQJRQWKHHYHQWVFHQDULRV7KHOLFHQVHHVWDWHGWKDWWKH

():PRGHOFRQVLVWVRI>>



@@7R

XVHWKLVPRGHOWKH6*WXEHVDUHPRGHOHGZLWK>>











@@



)RUWKH5&6RYHUKHDWLQJVFHQDULRVWKHOLFHQVHHVWDWHGWKDWWKHOLPLWLQJSHDN5&6SUHVVXUH

RFFXUVSULRUWRWKH66)$6:RU36:V\\VWHPEHLQJDOLJQHGWRWKH6*VIRUFRROLQJDQG

WKHUHIRUHWKH5(/$302'% :216EDVHPRGHOPRGLILHG>>



@@ZLOOQRWDIIHFWWKHSHDN5&6SUHVVXUH)RUWKH5&6RYHUFRROLQJVFHQDULRV

WKHPRGLILHGPRGHOFRQVHUYDWLYHO\\PD[LPL]HVWKHKHDWWUDQVIHUIURPWKH5&6LQWKH6*



7KH15&VWDIIILQGVWKH6*PRGHOLQJDSSURDFKLQWKH5(/$302'% :216EDVHPRGHO

DFFHSWDEOHEHFDXVHLWLVFRQVHUYDWLYHIRUWKH5&6RYHUFRROLQJDQDO\\VLVDQGLWGRHVQRWDIIHFW

WKH5&6SHDNSUHVVXUHLQWKHDQDO\\VLVRI5&6RYHUKHDWLQJVFHQDULRV





%RXQGDU\\&RQGLWLRQ0RGHOLQJ



7KH5(/$302'% :216EDVHPRGHOGRHVQRWLQFOXGHVSHFLILFERXQGDU\\FRQGLWLRQVIRU

WKH+(/%VFHQDULRVWKHUHIRUHWKHOLFHQVHHDGGHGWKHIROORZLQJIHDWXUHVLQWKH5(/$302'

% :216EDVHPRGHO



x

66)OHWGRZQOLQH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











x

/RRSKLJKSRLQWYHQWVDQG59KHDGYHQW

x

6WHDPOLQH$'9V

x

66)$6:

x

36:V\\VWHP

x

7XUELQHGULYHQ():

x

6HFRQGDU\\VWHDPORDGV



7KHPRGHOLQJDOVRLQFOXGHVWKHLPSDFWRQWKHERXQGDU\\FRQGLWLRQVGXHWR06+(/%ZKLFK

LQWURGXFHVDV\\PPHWU\\LQWKH6*ORRSV



7KH15&VWDIIILQGVWKHDGGHGERXQGDU\\FRQGLWLRQVIRUWKH5(/$302'% :216EDVH

PRGHODFFHSWDEOHEHFDXVHWKHVHPRGHOLQJIHDWXUHVDUHDSSOLHGWRHQVXUHDSSURSULDWHERXQGDU\\

FRQGLWLRQVDUHVSHFLILHGIRUHDFKVSHFLILFDQDO\\VLV





15&6WDII(YDOXDWLRQ



7KLV5(/$3PHWKRGRORJ\\LVVXLWDEOHIRUWKHSURSRVHG7+DQDO\\VHVEHFDXVHLWSURYLGHV

DFFXUDWHUHVXOWVIRUWKHWZRSKDVHFRQGLWLRQVWKDWSRWHQWLDOO\\FRXOGH[LVWLQWKH5&6GXULQJWKH

SRVWXODWHG+(/%HYHQWV7KH0)':+(/%DQGVRPH06+(/%VFHQDULRVFDQUHVXOWLQ

VXVWDLQHGWZRSKDVHFRQGLWLRQVLQWKH5&67KH15&VWDIIILQGVWKHXVHRI5(/$302'

% :216PHWKRGRORJ\\IRUWKHSURSRVHGDQDO\\VHVRIWKH+(/%VFHQDULRVDFFHSWDEOHEHFDXVH

RILWVDELOLW\\WRSUHGLFWDFFXUDWHUHVXOWVIRUWKHWZRSKDVHFRQGLWLRQVLQWKH5&67KHIHDWXUHV

GHVFULEHGLQ6XEVHFWLRQVWKURXJKDGGHGLQWKH5(/$302'% :216EDVH

PRGHODUHDFFHSWDEOH





7+$QDO\\VLV0HWKRGRORJLHVIRU06+(/%V



7KHOLFHQVHHXVHGWKHIROORZLQJ7+DQDO\\VLVPHWKRGRORJLHVIRUWKHSRVWXODWHG06+(/%

VFHQDULRVWKDWUHVXOWLQWKHRYHUFRROLQJRIWKH5&6



x

5(75$1'216

x

5(/$302'% :216

x

6.

x

63

x

9,35(



6HFWLRQRIWKH8)6$5VWDWHVWKDWWKH5(75$1'FRGHZDVGHYHORSHGE\\&RPSXWHU

6LPXODWLRQ $QDO\\VLV,QFIRU(35,WRHQKDQFHDQGH[WHQGWKHVLPXODWLRQFDSDELOLWLHVRIWKH

5(75$1FRGH5(75$1KDVWKHIOH[LELOLW\\WRPRGHODQ\\JHQHUDOIOXLGV\\VWHPE\\

SDUWLWLRQLQJWKHV\\VWHPLQWRDRQHGLPHQVLRQDOQHWZRUNRIIOXLGYROXPHVDQGFRQQHFWLQJ

MXQFWLRQV0RVWRIWKHFDSDELOLWLHVRIWKH5(75$1FRGHKDYHEHHQUHWDLQHGZLWKLQ

5(75$1'DVRSWLRQVH[FHSWIRUDOLPLWHGQXPEHURIPRGHOVDQGFRUUHODWLRQVWKDWZHUHQRWLQ

XVH



7KH5(75$1'216LV'XNH(QHUJ\\¶VPRGLILHGYHUVLRQRIWKH5(75$1'PHWKRGRORJ\\

GHVFULEHGLQ75V'3&1(3$'3&1(3$DQG'3&1(3$7KH5(75$1

'216PHWKRGRORJ\\LVQRWVXLWDEOHIRUDQDO\\]LQJ06+(/%VFHQDULRVLQZKLFKVXVWDLQHGWZR

SKDVHFRQGLWLRQVH[LVWLQWKH5&6DVLWGRHVQRWSUHGLFWDFFXUDWHUHVXOWVIRUWKHVHFRQGLWLRQV

)RUWKHVH06+(/%VFHQDULRVWKHOLFHQVHHXVHG5(/$302'% :216PHWKRGRORJ\\

ZKLFKKDVEHHQDFFHSWHGWRSUHGLFWDFFXUDWHUHVXOWVIRUWZRSKDVHFRQGLWLRQVLQWKH5&6

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











5(75$1'FRGHKDVWKHIROORZLQJFRUHQHXWURQLFVPRGHORSWLRQV D SRLQWNLQHWLFV E '

NLQHWLFVDQG F 'NLQHWLFV7KHOLFHQVHHVWDWHGWKDWXVLQJDSRLQWNLQHWLFVPRGHORSWLRQ

JHQHUDOO\\SURYLGHVDPRUHFRQVHUYDWLYHFRUHSRZHUUHVSRQVHUHODWLYHWRWKH'NLQHWLFVPRGHO

RSWLRQ



7RHQVXUHWKDWDQDSSURSULDWHWUDQVLHQWUHDFWLYLW\\LVFDOFXODWHGIRUWKH5&6RYHUFRROLQJDQDO\\VLV

WKHOLFHQVHHDOVRXVHG63FRUHPRGHOWRGHWHUPLQHFRQVHUYDWLYHUHDFWLYLW\\FDOFXODWLRQV LH

KLJKHUUHWXUQWRSRZHURUOHVVVXEFULWLFDO REWDLQHGE\\XVLQJ5(75$1'2167KHSURFHVV

XVHGLVGHVFULEHGLQWKH06/%DQDO\\VLVPHWKRGRORJ\\GHVFULEHGLQ'3&1(3$7KH

5(75$1'216SRLQWNLQHWLFVPRGHORSWLRQUHDFWLYLW\\FDOFXODWLRQSURYLGHGFRQVHUYDWLYHDQG

ERXQGLQJUHVXOWVUHODWLYHWRWKHUHVXOWVREWDLQHGXVLQJ63



7KHOLFHQVHHXVHG5(/$302'% :216DQG6.IRUWKHUHDFWLYLW\\FDOFXODWLRQIRU06

+(/%VFHQDULRVLQZKLFKWZRSKDVHFRQGLWLRQVRFFXULQWKH5&67KH5(/$302'% :

216FDOFXODWLRQSURYLGHGFRQVHUYDWLYHDQGERXQGLQJUHVXOWVUHODWLYHWRWKHUHVXOWVREWDLQHG

XVLQJ6.7KHOLFHQVHHVHOHFWHG6.LQVWHDGRI63IRUFRPSDULQJUHVXOWVZLWK

5(/$302'% :216FDOFXODWLRQEDVHGRQWKHDQWLFLSDWLRQRIYRLGLQJDWWKHOLPLWLQJUHWXUQ

WRSRZHUVWDWHSRLQW7KH6.PRGHOFDQFDOFXODWHYRLGLQJDQGLWVLPSDFWRQUHDFWLYLW\\DQG

SRZHUGLVWULEXWLRQVZKLFKDUHQRWLQFOXGHGLQWKH3:5YHUVLRQRI63



6.DQG63DUH6WXGVYLN6FDQGSRZHU¶VEHVWHVWLPDWHGLPHQVLRQDOFRUHNLQHWLFVFRGHVIRU

QHXWURQLFVDQG7+DQDO\\VLVRYHUDZLGHUDQJHRIDSSOLFDWLRQVIRU3:5V7KHOLFHQVHH¶V

DQDO\\VLVXVLQJ6.DQG63IROORZHGWKHJXLGDQFHGHVFULEHGLQWKHPHWKRGRORJ\\GHILQHGLQ

'3&1(3$ 5HIHUHQFH '3&1(3$ 5HIHUHQFH DQG1)6$

5HIHUHQFH 



9,35(LVD7+FRGHWRHYDOXDWHUHDFWRUFRUHVDIHW\\OLPLWVLQFOXGLQJPLQLPXP'1%5FULWLFDO

SRZHUUDWLRIXHODQGFODGWHPSHUDWXUHVDQG5&6VWDWHLQQRUPDORSHUDWLRQDQGDVVXPHG

DFFLGHQWFRQGLWLRQV7KHOLFHQVHH¶VDQDO\\VLVXVLQJ9,35(IROORZHGWKHJXLGDQFHGHVFULEHGLQ

WKHPHWKRGRORJ\\LQ'3&1(3$



)RUWKH'1%5FDOFXODWLRQGXULQJ06+(/%VFHQDULRVWKHOLFHQVHHXVHGPHWKRGRORJ\\GHVFULEHG

LQ'3&1(3$WRGHPRQVWUDWHWKDWDVLJQLILFDQWGHSDUWXUHIURPQXFOHDWHERLOLQJ '1% 

PDUJLQH[LVWVIRUWKHVWDWHSRLQWDWWKHSHDNKHDWIOX[



)RUWKH06+(/%5&6RYHUFRROLQJDQDO\\VLVWKHOLFHQVHHDGGHGWKHIROORZLQJIHDWXUHVLQ

5(75$1'216EDVHPRGHOE\\LQFOXGLQJERXQGDU\\FRQGLWLRQVIRUWKH+(/%VFHQDULRVWKDW

DUHQRWGHVFULEHGLQ'3&1(3$RU'3&1(3$



x

DGGLWLRQDOEUHDNMXQFWLRQV

x

WXUELQHGULYHQ():

x

VHFRQGDU\\VWHDPORDGV

x

DGGLWLRQDOVWHDPOLQHQRGHVWRIDFLOLWDWHWXUELQHFRQWUROPRGHOLQJ

x

QRUPDOOHWGRZQOLQH



7KHDERYHIHDWXUHVDUHXVHGIRUWKHDQDO\\VLVRI06+(/%VFHQDULRVXVLQJQRUPDOSODQW66)RU

36:V\\VWHPHTXLSPHQWWRHQVXUHDSSURSULDWHERXQGDU\\FRQGLWLRQVDUHVSHFLILHGIRUHDFK

DQDO\\VLV7KHOLFHQVHHDOVRPRGHOHGWKHDV\\PPHWU\\RIWKH6*ORRSVRFFXUULQJGXHWR+(/%V

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











7KHOLPLWDWLRQVDQGFRQGLWLRQVOLVWHGLQWKHJHQHULFVDIHW\\HYDOXDWLRQUHSRUW 6(5 IRUWKHXVHRI

5(75$1'KDYHEHHQHYDOXDWHGLQ$SSHQGL[&RI'3&1(3$7KLVHYDOXDWLRQ

GHPRQVWUDWHVWKDWWKH5(75$1'2167+PRGHOLVZLWKLQWKH5(75$1'6(5FRQGLWLRQV

DQGOLPLWDWLRQV





15&6WDII(YDOXDWLRQ



7KLV5(75$1'216PHWKRGRORJ\\LVVXLWDEOHIRUWKHSURSRVHG7+DQDO\\VHVIRUVRPHRIWKH

06+(/%HYHQWVLQZKLFKWKHSRWHQWLDORIWZRSKDVHFRQGLWLRQVZRXOGQRWH[LVWLQWKH5&6

7KHOLFHQVHHDGGHGDFFHSWDEOHIHDWXUHVWRWKH5(75$1'216PRGHOE\\LQFOXGLQJWKH

VSHFLILFERXQGDU\\FRQGLWLRQVDQGWKHDV\\PPHWU\\LQWKH6*ORRSVGXHWR+(/%IRUWKH5&6

RYHUFRROLQJDQDO\\VHV7KH15&VWDIIILQGVWKHXVHRIWKH5(75$1'SRLQWNLQHWLFVPRGHO

RSWLRQDFFHSWDEOHDQGPRUHVXLWDEOHUHODWLYHWRLWV'NLQHWLFVPRGHORSWLRQEHFDXVHWKHIRUPHU

UHVXOWVLQDFRQVHUYDWLYHFRUHSRZHUUHVSRQVH





7+$QDO\\VLVRI0)':+(/%6FHQDULRV



7KHSRVWXODWHG0)':+(/%RXWVLGHWKHFRQWDLQPHQWUHVXOWVLQWKH7%IORRGLQJFUHDWHV

RYHUKHDWLQJRIWKH5&6DQGPDNHVLWQHFHVVDU\\WREULQJWKHXQLWVWRDQ66'FRQGLWLRQ7KH

OLFHQVHHDQDO\\]HGWKHIROORZLQJ0)':+(/%VFHQDULRV



x

9$&3RZHU$YDLODEOH0LWLJDWLRQE\\1RUPDO3ODQW(TXLSPHQW

o 0)':+(/%LQWKH7%

o 0)':+(/%LQWKH(35XSVWUHDPRIFKHFNYDOYH

o 0)':+(/%LQWKH(35GRZQVWUHDPRIFKHFNYDOYH

x

9$&3RZHU8QDYDLODEOHGXHWR+(/%66)0LWLJDWLRQ

x

9$&3RZHU8QDYDLODEOHGXHWR+(/%36:0LWLJDWLRQ



7KHHYDOXDWLRQRIWKH5&67+RYHUKHDWLQJDQDO\\VLVIRUHDFKRIWKHVHVFHQDULRVLVJLYHQEHORZ





0)':+(/%LQWKH7%0LWLJDWLRQE\\1RUPDO3ODQW(TXLSPHQW



)RUWKHDQDO\\VLVRI0)':+(/%VFHQDULRLQWKH7%WKH9$&(6VZLWFKJHDULVDVVXPHG

WREHDYDLODEOHDQGWKHUHIRUHQRUPDOSODQWHTXLSPHQWLVXVHGIRU+(/%PLWLJDWLRQDQGIRU

EULQJLQJWKHSODQWWRDQ66'FRQGLWLRQ7KHWUDQVLHQWUHVXOWVLQRYHUKHDWLQJRIWKH5&6ZKLOH

WKHWZRPRWRUGULYHQ():SXPSVDQGDOOIRXU5&3VUHPDLQRSHUDWLQJ7KH5(/$302'

% :216PRGHOLVXVHGIRUWKHDQDO\\VLV7KH,QLWLDOFRQGLWLRQVDVVXPSWLRQVRSHUDWRUDFWLRQV

DQGUHVXOWVRIWKHDQDO\\VLVDUHVXPPDUL]HGEHORZ



,QLWLDO&RQGLWLRQV



x

9$&SRZHULVDYDLODEOH

x

5HDFWRUWKHUPDOSRZHUSHUFHQWRIPHJDZDWWVWKHUPDO 0:W DWKRWIXOOSRZHU

+)3 FRQGLWLRQV

x

&RPSOHWHORVVRI0)':

x

6LQJOHDFWLYHIDLOXUH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











$VVXPSWLRQV



x

'HFD\\KHDWLVDFFRUGLQJWR$PHULFDQ1XFOHDU6RFLHW\\ $16  5HIHUHQFH ZLWKDV XQFHUWDLQW\\

x

7KH536WULSVWKHUHDFWRUIROORZLQJWKHORVVRI0)':RQKLJK5&6SUHVVXUH

x

6*SUHVVXUHLVXQDIIHFWHGGXHWRWKHSUHVHQFHRI0)':FKHFNYDOYHV

x

7KH06OLQHVDUHDVVXPHGWRUHPDLQLQWDFWZLWKRQO\\WKH0659VOLIWLQJDQGFRQWUROOLQJ06

SUHVVXUHWRPD[LPL]HWKH5&6KHDWXS

x

&RQVHUYDWLYHO\\WZRPRWRUGULYHQ():SXPSVDQGDOOIRXU5&3VDUHRSHUDWLQJIRU

RYHUKHDWLQJRI5&6

x

():V\\VWHPLVDYDLODEOHIRU6*KHDWUHPRYDO

x

&RQVHUYDWLYHO\\SUHVVXUL]HUVSUD\\VDUHQRWFUHGLWHG

x

7KHSUHVVXUL]HUVDIHW\\YDOYHV 369V DUHFUHGLWHGWRPDLQWDLQ5&6SUHVVXUHEHORZLWVVDIHW\\

OLPLW



2SHUDWRU$FWLRQV



1RRSHUDWRUDFWLRQVDUHFUHGLWHGSULRUWRUHDFKLQJWKHSHDN5&6SUHVVXUH

5HVXOWV

x

,QWHJULW\\RIWKHIXHOLVHQVXUHGE\\FRQWUROURGLQVHUWLRQ

x

'+5IURPERWK6*VXVLQJ():V\\VWHPNHHSVWKHFRUHLQWDFWDQGPDLQWDLQVDFRRODEOHFRUH

JHRPHWU\\

x

7KH5&6SUHVVXUHDQGWHPSHUDWXUHLQFUHDVHEHFDXVHRILQVXIILFLHQWKHDWUHPRYDOE\\WKH

6*VZKLOHWKHWZR():SXPSVDQGIRXU5&3VDUHLQRSHUDWLRQ7KHLQFUHDVHLQSUHVVXUH

GRPLQDWHVDQGWKHUHIRUHLQFUHDVHVWKH5&6VXEFRROLQJLQWKHFRUHWRVXSSUHVVDQ\\

SRWHQWLDO'1%,QFUHDVHLQWKH5&6WHPSHUDWXUHUHVXOWVLQDGHFUHDVHLQFRUHSRZHU

EHFDXVHRIWKHQHJDWLYHPRGHUDWRUWHPSHUDWXUHFRHIILFLHQW7KHPLQLPXP'1%5LVQRW

OLPLWLQJDVLWLVERXQGHGE\\WKHXQFRQWUROOHGEDQNZLWKGUDZDODQDO\\VLVVWDWHSRLQWLQFOXGHGLQ

WKHQRUPDO216UHORDGDQDO\\VLV

x

7KHPD[LPXP5&6SUHVVXUHLVGHWHUPLQHGWREHSVLDZKLFKLVEHORZLWVVDIHW\\OLPLW

RISVLJ SVLD DQGRFFXUVGXULQJWKHLQLWLDO369F\\FOH7KH369 VHWSRLQW

SVLJ PDLQWDLQVWKH5&6SUHVVXUHEHORZWKHVDIHW\\OLPLW7KHSUHVVXUL]HUGRHVQRWEHFRPH

ZDWHUVROLG



7KH15&VWDIIILQGVWKDWWKHDQDO\\VLVLVEDVHGRQFRQVHUYDWLYHLQLWLDOFRQGLWLRQVDQGYDOLG

DVVXPSWLRQVDQGPHHWVWKHDFFHSWDQFHFULWHULDJLYHQLQ6HFWLRQ7KHUHIRUHWKH15&

VWDIIILQGVWKDWWKHUHVXOWVRIWKLVDQDO\\VLVDUHDFFHSWDEOH





0)':+(/%LQWKH(358SVWUHDPRI&KHFN9DOYH



)RUWKHDQDO\\VLVRIWKH0)':+(/%VFHQDULRLQWKH(35XSVWUHDPRIWKH0)':FKHFNYDOYH

WKH9$&(6VZLWFKJHDULVDVVXPHGWREHDYDLODEOHDQGWKHUHIRUHQRUPDOSODQWHTXLSPHQW

LVXVHGIRU+(/%PLWLJDWLRQDQGIRUEULQJLQJWKHSODQWWRDQ66'FRQGLWLRQ7KHWUDQVLHQWUHVXOWV

LQDQRYHUKHDWLQJRIWKH5&6ZLWKWZRPRWRUGULYHQ():SXPSVDQGDOOIRXU5&3VRSHUDWLQJ

7KH5(/$302'% :216PRGHOLVXVHGIRUWKH7+DQDO\\VLV,QLWLDOFRQGLWLRQV

DVVXPSWLRQVRSHUDWRUDFWLRQVDQGWKHUHVXOWVRIWKHDQDO\\VLVDUHJLYHQEHORZ

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











,QLWLDO&RQGLWLRQV



x

9$&SRZHULVDYDLODEOH

x

5HDFWRUWKHUPDOSRZHUSHUFHQWRI0:WDW+)3FRQGLWLRQV

x

&RPSOHWHORVVRI0)':

x

6LQJOHDFWLYHIDLOXUH



$VVXPSWLRQV



x

'HFD\\KHDWLVDFFRUGLQJWR$16ZLWKDVXQFHUWDLQW\\

x

7KH536WULSVWKHUHDFWRUIROORZLQJWKHORVVRI0)':RQKLJK5&6SUHVVXUH

x

6*SUHVVXUHLVXQDIIHFWHGEHFDXVHWKHEUHDNLVXSVWUHDPRIWKH0)':OLQHFKHFNYDOYHV

x

():V\\VWHPLVDYDLODEOHIRU6*KHDWUHPRYDO

x

7KH+3,V\\VWHPLVDYDLODEOHIRUQRUPDOPDNHXSDQG5&3VHDOFRROLQJ

x

7KH536():DQG+3,DUHVXIILFLHQWWRDFKLHYHDQGPDLQWDLQUHDFWRULQ66'FRQGLWLRQ

x

7KH$'9VLQDGGLWLRQWR+3,DQG():DUHFUHGLWHGWRFRROWKHSODQWGRZQWR/3,HQWU\\

FRQGLWLRQV



2SHUDWRU$FWLRQV



1RRSHUDWRUDFWLRQVDUHFUHGLWHGSULRUWRUHDFKLQJWKHSHDN5&6SUHVVXUH

5HVXOWV

x

5HDFWRUGRHVQRWUHWXUQWRFULWLFDOLW\\

x

'1%5DWUHDFWRUWULSLVERXQGHGE\\WKHH[LVWLQJ8)6$5&KDSWHUDQDO\\VHV

x

3HDN5&6SUHVVXUHUHPDLQVEHORZWKHSVLJOLPLW

x

'+5DQGSULPDU\\FRRODQWPDNHXSFRQWLQXHVWRNHHSWKHFRUHFRYHUHGDQGPDLQWDLQVD

FRRODEOHFRUHJHRPHWU\\

x

5HDFWRUUHPDLQVLQ0RGHIRUWKHGXUDWLRQRIWKHVFHQDULR

x

,QWHJULW\\RIWKHIXHOLVHQVXUHGE\\WKHFRQWUROURGLQVHUWLRQ



7KH15&VWDIIILQGVWKDWWKHDQDO\\VLVLVEDVHGRQFRQVHUYDWLYHLQLWLDOFRQGLWLRQVDQGYDOLG

DVVXPSWLRQVDQGPHHWVWKHDFFHSWDQFHFULWHULDJLYHQLQ6HFWLRQ7KHUHIRUHWKH15&

VWDIIILQGVWKDWWKHUHVXOWVRIWKLVDQDO\\VLVDUHDFFHSWDEOH





0)':+(/%LQWKH(35'RZQVWUHDPRI&KHFN9DOYH



)RUWKHDQDO\\VLVRIWKH0)':+(/%VFHQDULRLQWKH(35GRZQVWUHDPRIWKH0)':FKHFN

YDOYHWKH9$&(6VZLWFKJHDULVDVVXPHGWREHDYDLODEOHDQGWKHUHIRUHQRUPDOSODQW

HTXLSPHQWLVXVHGIRU+(/%PLWLJDWLRQDQGIRUEULQJLQJWKHSODQWWRDQ66'FRQGLWLRQ7KH

WUDQVLHQWUHVXOWVLQDQRYHUKHDWLQJRIWKH5&6ZLWKWZRPRWRUGULYHQ():SXPSVDQGDOOIRXU

5&3VRSHUDWLQJ7KH5(/$302'% :216PRGHOLVXVHGIRUWKH7+DQDO\\VLV,QLWLDO

FRQGLWLRQVDVVXPSWLRQVRSHUDWRUDFWLRQVDQGWKHUHVXOWVRIWKHDQDO\\VLVDUHVXPPDUL]HG

EHORZ



,QLWLDO&RQGLWLRQV



x

9$&SRZHULVDYDLODEOH

x

5HDFWRUWKHUPDOSRZHUSHUFHQWRI0:WDW+)3FRQGLWLRQV

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











x

%UHDNDUHDLVOLPLWHGWRIWE\\DJXDUGSLSH

x

6LQJOHDFWLYHIDLOXUH



$VVXPSWLRQV



x

'HFD\\KHDWLVDFFRUGLQJWR$16ZLWKDVXQFHUWDLQW\\

x

536WULSVWKHUHDFWRUIROORZLQJWKHEUHDNRQKLJKUHDFWRUSUHVVXUH

x

/LPLWHGEUHDNDUHDDOORZVDIUDFWLRQRIWKHLQLWLDO)':IORZWRUHDFKWKH6*V

x

5HGXFHGLQLWLDO)':IORZWRWKH6*VUHVXOWVLQDUDSLGKHDWXSRIWKH5&6

x

7KHDIIHFWHG6*FRPSOHWHO\\GHSUHVVXUL]HVIROORZLQJWKHUHDFWRUWULSUHVXOWLQJLQDQ$),6

DFWXDWLRQ

x

2QORZVWHDPOLQHSUHVVXUH$),6ZLOOWULSERWK0)':SXPSVDQGWULSRUEORFNWKHWXUELQH

GULYHQ():SXPS

x

&RQVHUYDWLYHO\\LQLWLDOO\\WZRPRWRUGULYHQ():SXPSVDQGDOOIRXU5&3VDUHRSHUDWLQJIRU

RYHUKHDWLQJRI5&6

x

&RQVHUYDWLYHO\\SUHVVXUL]HUVSUD\\VDUHQRWFUHGLWHG

x

1RUPDO5&6OHWGRZQLVORVW

x

3259LVQRWDYDLODEOHIRUSUHVVXUHFRQWURO



2SHUDWRU$FWLRQV



x

5HGXFHWKHQXPEHURIRSHUDWLQJ5&3VWRRQHSXPSRSHUDWLRQLQHDFKORRSDWPLQXWHVWR

OLPLWWKH5&6SUHVVXUHEHORZWKH369OLIWVHWSRLQW

x

2SHQRQHORRSKLJKSRLQWYHQW +39 WRFRQWURO5&6SUHVVXUHEHWZHHQSVLJDIWHU

+39VEHFRPHDYDLODEOHDWPLQXWHV



5HVXOWV



x

5HDFWRUGRHVQRWUHWXUQWRFULWLFDOLW\\

x

'1%5DWUHDFWRUWULSLVERXQGHGE\\WKHH[LVWLQJ8)6$5&KDSWHUDQDO\\VHV

x

3HDN5&6SUHVVXUHUHPDLQVEHORZWKHSVLJOLPLW

x

'+5DQGSULPDU\\FRRODQWPDNHXSFRQWLQXHVWRNHHSWKHFRUHFRYHUHGDQGPDLQWDLQVD

FRRODEOHFRUHJHRPHWU\\

x

5HDFWRUUHPDLQVLQ0RGHIRUWKHGXUDWLRQRIWKHVFHQDULR

x

,QWHJULW\\RIWKHIXHOLVHQVXUHGE\\WKHFRQWUROURGLQVHUWLRQ



7KH15&VWDIIILQGVWKDWWKHDQDO\\VLVLVEDVHGRQFRQVHUYDWLYHLQLWLDOFRQGLWLRQVDQGYDOLG

DVVXPSWLRQVDQGPHHWVWKHDFFHSWDQFHFULWHULDJLYHQLQ6HFWLRQ7KHUHIRUHWKH15&

VWDIIILQGVWKDWWKHUHVXOWVRIWKLVDQDO\\VLVDUHDFFHSWDEOH





0)':+(/%LQWKH7%66)0LWLJDWLRQ



)RUWKHDQDO\\VLVRI0)':+(/%VFHQDULRLQWKH7%WKH66)$6:LVXVHGIRUSURYLGLQJDQ

DOWHUQDWHPHDQVRIHVWDEOLVKLQJ6*KHDWUHPRYDOLIWKH():V\\VWHPLVXQDYDLODEOH7KLV

DQDO\\VLVHYDOXDWHVWKH5&6UHVSRQVHWRDUXSWXUHLQWKH0)':SLSLQJZLWKDORVVRIWKH

9$&(6VZLWFKJHDUGXHWRD7%+(/%7KLVEUHDNORFDWLRQLVXSVWUHDPRIWKH0)':OLQH

FKHFNYDOYHVVXFKWKDWDEUHDNLQWKLVORFDWLRQUHVXOWVLQDFRPSOHWHORVVRI0)':WRERWK6*V

7KH5(/$302'% :216PRGHOLVXVHGIRUWKH7+DQDO\\VLV,QLWLDOFRQGLWLRQV

DVVXPSWLRQVRSHUDWRUDFWLRQVDQGWKHUHVXOWVRIWKHDQDO\\VLVDUHVXPPDUL]HGEHORZ

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











,QLWLDO&RQGLWLRQV



x

/RVVRI9$&(6VZLWFKJHDUGXHWR7%+(/%

x

5HDFWRUWKHUPDOSRZHUSHUFHQWRI0:WDW+)3FRQGLWLRQV

x

5XSWXUHLQWKH0)':SLSLQJLQWKH7%

x

%UHDNORFDWLRQLVXSVWUHDPRIWKH0)':OLQHFKHFNYDOYHVUHVXOWLQJLQDFRPSOHWHORVVRI

0)':WRERWK6*V



$VVXPSWLRQV



x

'HFD\\KHDWLVDFFRUGLQJWR$16ZLWKDVXQFHUWDLQW\\

x

&RQVHUYDWLYHO\\DVVXPHUHDFWRUGRHVQRWWULSFRLQFLGHQWZLWKORVVRISRZHU

x

0RWRUGULYHQ():SXPSVDUHXQDYDLODEOHGXHWRORVVRI9$&SRZHU

x

7XUELQHGULYHQ():SXPSVDUHDVVXPHGXQDYDLODEOH

x

6*66)$6:IORZLVFRQWUROOHGE\\SURFHGXUHWRPDLQWDLQDQ5&6SUHVVXUHDWSVLJ

DSSUR[LPDWHO\\

x

3RUWLRQVRIWKHLQWHJUDWHGFRQWUROV\\VWHP ,&6 DUHXQSURWHFWHGIURP+(/%GDPDJH

WKHUHIRUHWKHSUHVVXUL]HU3259LVDVVXPHGWREHXQDYDLODEOH

x

5&6SUHVVXUHLQFUHDVHVWRWKH369OLIWVHWWLQJDQGWKH369VF\\FOHWRFRQWURO5&6SUHVVXUH

XQWLORSHUDWRUVHVWDEOLVK66)$6:IORZ

x

3UHVVXUL]HULVSUHGLFWHGQRWWREHFRPHZDWHUVROLGSULRUWR66)$6:DOLJQHGWR6*

2SHUDWRU$FWLRQV

x

7ULSWKHRSHUDWLQJ5&3VHLWKHUPLQXWHVDIWHUDORVVRILQGLFDWHGVXEFRROHGPDUJLQRU

PLQXWHVDIWHUORVVRI5&3VHDOFRROLQJ

x

$OLJQ66)$6:WRHVWDEOLVKVWHDPJHQHUDWRUFRROLQJDWPLQXWHV

x

(VWDEOLVK5&3VHDOFRROLQJDQG5&6PDNHXSIURP66)5&08DWPLQXWHV

x

(QHUJL]HSUHVVXUL]HUKHDWHUVIURPWKH66)VWDQGE\\SRZHUVXSSO\\IRU5&6SUHVVXUHFRQWURO

DWPLQXWHV

x

7KURWWOH66)$6:WRPDLQWDLQ5&6SUHVVXUHEDQGXQWLO6*OHYHOGHYHORSVWKHQPDLQWDLQ

6*OHYHOEDQGDIWHUZDUGV



5HVXOWV



x

5HDFWRUGRHVQRWUHWXUQWRFULWLFDOLW\\

x

'1%5DWUHDFWRUWULSLVERXQGHGE\\WKHH[LVWLQJ8)6$5&KDSWHUDQDO\\VHV

x

3HDN5&6SUHVVXUHUHPDLQVEHORZWKHSVLJOLPLWDQGLVGHWHUPLQHGE\\WKH369YDOYH

FKDUDFWHULVWLFVDVWKH3259LVQRWDYDLODEOH

x

'+5DQGVXIILFLHQWSULPDU\\FRRODQWPDNHXSNHHSVWKHFRUHFRYHUHGDQGPDLQWDLQVWKH5&6

LQ0RGHIRUWKHGXUDWLRQRIWKHVFHQDULR

x

,QWHJULW\\RIWKHIXHOLVHQVXUHGE\\WKHFRQWUROURGLQVHUWLRQDQGWKHFRUHUHPDLQVFRYHUHG

x

3UHVVXUL]HUGRHVQRWEHFRPHZDWHUVROLGEHIRUH66)$6:IORZLVLQLWLDWHGWRWKH6*VDW

PLQXWHVWKHUHIRUHOLTXLGUHOLHIGRHVQRWWDNHSODFHWKURXJKWKH369V



7KH15&VWDIIILQGVWKDWWKHDQDO\\VLVLVEDVHGRQFRQVHUYDWLYHLQLWLDOFRQGLWLRQVDQGYDOLG

DVVXPSWLRQVDQGPHHWVWKHDFFHSWDQFHFULWHULDJLYHQLQ6HFWLRQ7KHUHIRUHWKH15&

VWDIIILQGVWKDWWKHUHVXOWVRIWKLVDQDO\\VLVDUHDFFHSWDEOH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21













0)':+(/%LQWKH7%36:0LWLJDWLRQ



)RUWKHDQDO\\VLVRIWKH0)':+(/%VFHQDULRLQWKH7%WKH36:V\\VWHPLVXVHGDVDQ

DOWHUQDWHPHDQVRIHVWDEOLVKLQJ6*KHDWUHPRYDOZKHQERWKWKH():V\\VWHPDQG66)$6:

DUHXQDYDLODEOH7KHDQDO\\VLVHYDOXDWHVWKH5&6UHVSRQVHWRDORVVRI0)':ZLWKDORVVRIWKH

9$&(6VZLWFKJHDUGXHWRD7%+(/%7KHEUHDNORFDWLRQLVXSVWUHDPRIWKH0)':OLQH

FKHFNYDOYHVUHVXOWLQJLQDFRPSOHWHORVVRI0)':WRERWK6*V7KH5(/$302'% :

216PRGHOLVXVHGIRUWKH7+DQDO\\VLV,QLWLDOFRQGLWLRQVDVVXPSWLRQVRSHUDWRUDFWLRQVDQG

WKHUHVXOWVRIWKHDQDO\\VLVDUHJLYHQEHORZ



,QLWLDO&RQGLWLRQV



x

/RVVRI9$&(6VZLWFKJHDUGXHWR7%+(/%

x

5HDFWRUWKHUPDOSRZHUSHUFHQWRI0:WDW+)3FRQGLWLRQV

x

5XSWXUHLQWKH0)':SLSLQJLQ7%UHVXOWLQJLQDFRPSOHWHORVVRI0)':WRERWK6*V



$VVXPSWLRQV



x

'HFD\\KHDWLVDFFRUGLQJWR$16ZLWKDVXQFHUWDLQW\\

x

0RWRUGULYHQ():SXPSVDUHXQDYDLODEOHGXHWRORVVRISRZHU

x

7XUELQHGULYHQ():SXPSVDUHDVVXPHGXQDYDLODEOH

x

6*36:IORZLVFRQWUROOHGE\\SURFHGXUHWRPDLQWDLQDQ5&6SUHVVXUHDWDERXWSVLJ

x

3RUWLRQVRIWKH,&6DUHXQSURWHFWHGIURP+(/%GDPDJHWKHUHIRUHWKHSUHVVXUL]HU3259LV

DVVXPHGWREHXQDYDLODEOH

x

5&6SUHVVXUHLQFUHDVHVWRWKH369OLIWVHWWLQJDQGWKH369VF\\FOHWRFRQWURO5&6SUHVVXUH

XQWLORSHUDWRUVHVWDEOLVK36:IORZ



2SHUDWRU$FWLRQV



x

7ULSWKHRSHUDWLQJ5&3VHLWKHUDWPLQXWHVDIWHUDORVVRILQGLFDWHGVXEFRROHGPDUJLQRU

PLQXWHVDIWHUORVVRI5&3VHDOFRROLQJ

x

$OLJQ36:WRHVWDEOLVK6*FRROLQJDWPLQXWHV IURPORVVRI0)': IURPWKH&5

x

(VWDEOLVK5&3VHDOFRROLQJDQG5&6PDNHXSIURPRQH+3,SXPSDWPLQXWHV

x

(QHUJL]HSUHVVXUL]HUKHDWHUVIURPWKH36:VZLWFKJHDUIRU5&6SUHVVXUHFRQWURODWKRXUV

x

7KURWWOH36:WRPDLQWDLQDQ5&6SUHVVXUHEDQGXQWLO6*OHYHOGHYHORSVWKHQPDLQWDLQ6*

OHYHOEDQGDIWHUZDUGV



5HVXOWV



x

5HDFWRUGRHVQRWUHWXUQWRFULWLFDOLW\\

x

'1%5DWUHDFWRUWULSLVERXQGHGE\\WKHH[LVWLQJ8)6$5&KDSWHUDQDO\\VHV

x

3HDN5&6SUHVVXUHUHPDLQVEHORZWKHSVLJOLPLWDQGLVGHWHUPLQHGE\\WKH369YDOYH

FKDUDFWHULVWLFVDVWKH3259LVQRWDYDLODEOH

x

'+5DQGVXIILFLHQWSULPDU\\FRRODQWPDNHXSNHHSVWKHFRUHFRYHUHGDQGPDLQWDLQVWKH5&6

LQ0RGHIRUWKHGXUDWLRQRIWKHVFHQDULR

x

,QWHJULW\\RIWKHIXHOLVHQVXUHGE\\WKHFRQWUROURGLQVHUWLRQ

x

3UHVVXUL]HULVSUHGLFWHGQRWWREHFRPHZDWHUVROLGSULRUWR36:IORZLVLQLWLDWHGWRWKH6*V

WKHUHIRUHOLTXLGUHOLHILVQRWSUHGLFWHGWKURXJKWKH369V

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











7KH15&VWDIIILQGVWKDWWKHDQDO\\VLVLVEDVHGRQFRQVHUYDWLYHLQLWLDOFRQGLWLRQVDQGYDOLG

DVVXPSWLRQVDQGPHHWVWKHDFFHSWDQFHFULWHULDJLYHQLQ6HFWLRQ7KHUHIRUHWKH15&

VWDIIILQGVWKDWWKHUHVXOWVRIWKLVDQDO\\VLVDUHDFFHSWDEOH





7+$QDO\\VLVIRU06+(/%6FHQDULRV



7KHSRVWXODWHG06+(/%RXWVLGHWKHFRQWDLQPHQWUHVXOWVLQRYHUFRROLQJRIWKH5&6DQGPDNHV

LWQHFHVVDU\\WREULQJWKHXQLWVWRDQ66'FRQGLWLRQ7KHOLFHQVHHDQDO\\]HGWKHIROORZLQJ06

+(/%VFHQDULRV



x

9$&3RZHU$YDLODEOH0LWLJDWLRQE\\1RUPDO3ODQW(TXLSPHQW



6LQJOH06+(/%LQWKH7%9$&3RZHU$YDLODEOH



'RXEOH06+(/%LQWKH7%9$&3RZHU$YDLODEOH



'RXEOH06+(/%/2239$&3RZHU$YDLODEOH

x

9$&3RZHU8QDYDLODEOH66)0LWLJDWLRQ



6LQJOH06+(/%LQWKH7%



'RXEOH06+(/%LQWKH7%

x

9$&3RZHU8QDYDLODEOH36:0LWLJDWLRQ



6LQJOH06+(/%LQWKH7%



'RXEOH06+(/%LQWKH7%



7KHHYDOXDWLRQRIWKH5&6RYHUFRROLQJ7+DQDO\\VLVIRUHDFKRIWKHVHVFHQDULRVLVJLYHQEHORZ





6LQJOH06+(/%LQWKH7%9$&3RZHU$YDLODEOH



7KHDQDO\\VLVDVVXPHVDGRXEOHHQGHGEUHDNRIDVLQJOH06OLQHLQWKH7%PLWLJDWHGE\\QRUPDO

SODQWHTXLSPHQWDVWKHQRUPDO9$&SRZHUUHPDLQVDYDLODEOH,QLWVUHVSRQVHWR5$,E\\

OHWWHUGDWHG-XQHWKHOLFHQVHHVWDWHGWKDWVLQJOH06+(/%LVQRWVSHFLILFDOO\\DQDO\\]HG

IRUWKLV/$5EHFDXVHWKHH[LVWLQJ06/%DQDO\\VHVGHVFULEHGLQ8)6$56HFWLRQVDQG

VLPLODUO\\DVVXPHWKDW9$&SRZHULVQRWDIIHFWHGE\\WKHEUHDNV7KH8)6$5

&KDSWHUDQDO\\VHVZHUHSHUIRUPHGXVLQJWKH5(75$1'PHWKRGRORJ\\



,Q$WWDFKPHQWWRWKHVXEPLWWDOGDWHG$XJXVW6HFWLRQWKHOLFHQVHHVWDWHGLQ

SDUW



7KHVHDQDO\\VHVDVVXPHDQLQLWLDOFRUHSRZHUOHYHORISHUFHQWRI0:

DQG+)3FRQGLWLRQV5&6LQWHJULW\\LVGHPRQVWUDWHGE\\GHWHUPLQLQJWKHOLPLWLQJ

6*WXEHFRPSUHVVLYHDQGWHQVLOHVWUHVVHVUHPDLQZLWKLQGHVLJQOLPLWVDQGWKDW

WKH5&6SUHVVXUHDQGWHPSHUDWXUHUHPDLQVZLWKLQWKHDFFHSWDEOHFRROGRZQ

OLPLWVGXULQJWKHWUDQVLHQWHYROXWLRQ7KHPD[LPXPWHQVLOHVWUHVVUHVXOWLQJIURPD

VLQJOH06/%LVVLJQLILFDQWO\\OHVVWKDQWKHOLPLWLQJWHQVLOHVWUHVVWKDWUHVXOWVIURPD

ODUJHEUHDN/2&$>ORVVRIFRRODQWDFFLGHQW@:LWK9$&SRZHUDYDLODEOH

QRUPDOSODQWHTXLSPHQWLVDEOHWRPDLQWDLQWKHSODQWZLWKLQOLPLWVGXULQJWKH

FRROGRZQ



,QLWVUHVSRQVHWR5$,DQGE\\OHWWHUGDWHG-XQHWKHOLFHQVHHVWDWHGLQSDUW



7KHLQLWLDOFRQGLWLRQVIRUWKH8)6$5&KDSWHU<<DQG8)6$5&KDSWHU

DQDO\\VHVSHUIRUPHGWRHYDOXDWHWKHOLPLWLQJPLQLPXP'1%5DUHGHILQHGE\\WKH

VWDWLVWLFDOFRUHGHVLJQ 6&' PHWKRGRORJ\\7KLVPHWKRGVSHFLILHVWKDW

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











SDUDPHWHUVLPSRUWDQWWRWKH'1%5DUHVHWWRQRPLQDOYDOXHVDQGLQFRUSRUDWHV

WKHDVVRFLDWHGXQFHUWDLQW\\LQWKH'1%5HYDOXDWLRQ



7KHDQDO\\VLVUHVXOWVLQDOLPLWLQJWXEHWRVKHOO7RI)7KHUHIRUHWKH6*WXEHVWUHVVHV

ZKLFKDUHEDVHGRQWXEHWRVKHOO7RI)DUHERXQGHGE\\WKH6*WXEHVWUHVVHVEDVHGRQ

7RI)LQGXFHGGXULQJDODUJHEUHDN/2&$DQGDUHWKHUHIRUHEHORZWKHLUGHVLJQOLPLWV



7KH15&VWDIIILQGVLWDFFHSWDEOHWKDWWKH6*WXEHVWUHVVHVIRUVLQJOH06+(/%DUHERXQGHGE\\

WKH6*WXEHVWUHVVHVLQGXFHGGXULQJDODUJHEUHDN/2&$DQGWKHUHIRUHDUHEHORZWKHLUGHVLJQ

OLPLWV7KH15&VWDIIDOVRILQGVLWDFFHSWDEOHWKDWWKHPLQLPXP'1%5PHHWVWKHVSHFLILHG

DFFHSWDEOHIXHOGHVLJQOLPLWVEHFDXVHWKHOLPLWLQJPLQLPXP'1%5IURPWKH8)6$5&KDSWHU

DQDO\\VHVDUHLQFOXGHGLQWKHQRUPDOUHORDGFRUHGHVLJQSURFHVV%DVHGRQWKHDERYHDQGWKH

06+(/%PLWLJDWLRQDFFHSWDQFHFULWHULDLQ6HFWLRQEHLQJPHWWKH15&VWDIIILQGVWKDW

WKHVLQJOH06+(/%LQWKH7%FDQEHPLWLJDWHGXVLQJWKHQRUPDOSODQWHTXLSPHQW





'RXEOH06+(/%LQWKH7%9$&DQG9$&3RZHU$YDLODEOH



7KHDQDO\\VLVDVVXPHVDGRXEOHHQGHGJXLOORWLQHEUHDNLQERWK06OLQHVLQWKH7%PLWLJDWHGE\\

QRUPDOSODQWHTXLSPHQWDVWKHQRUPDO9$&SRZHUUHPDLQVDYDLODEOH7KHOLFHQVHH

DQDO\\]HGWKLVVFHQDULRXVLQJWKH5(75$1'216PHWKRGRORJ\\7KHOLFHQVHHVWDWHGWKDWWKH

ERXQGDU\\FRQGLWLRQVIRUWKLVVFHQDULRDUHLGHQWLFDOWRWKH8)6$56HFWLRQ06/%

DQDO\\VLVIRUWKHFDVHZLWKRIIVLWHSRZHUDYDLODEOHDQGZLWKDGRXEOHHQGHGJXLOORWLQHEUHDNRI

RQHRIWKHWZRPDLQVWHDPOLQHVLQVLGHWKHFRQWDLQPHQW7KHPDLQGLIIHUHQFHLVWKDWERWK6*V

H[SHULHQFHDQXQFRQWUROOHGGHSUHVVXUL]DWLRQLQWKHGRXEOH06+(/%DQDO\\VLV



,QLWLDO&RQGLWLRQV



x

9$&DQG9$&SRZHULVDYDLODEOH

x

5HDFWRUWKHUPDOSRZHUSHUFHQWRI0:WDW+)3FRQGLWLRQV

x

6LQJOHDFWLYHIDLOXUH



$VVXPSWLRQV



x

'HFD\\KHDWLVDFFRUGLQJWR$16ZLWKDVXQFHUWDLQW\\

x

&RQVHUYDWLYHO\\DVVXPHLPPHGLDWHUHDFWRUWULSWRPD[LPL]HRYHUFRROLQJHIIHFW

x

&RQVHUYDWLYHO\\QRFUHGLWLVWDNHQIRUDXWRPDWLFLVRODWLRQRI0)':RU():GXULQJWKLV

VFHQDULR7KHFRQGHQVDWHDQG)':V\\VWHPVDUHDVVXPHGWRFRQWLQXHIHHGLQJWKH6*V

XQWLOWKHFRQGHQVDWHLQYHQWRU\\LVGHSOHWHG

x

7KHWXUELQHGULYHQ():SXPSLVDVVXPHGWRRSHUDWHWRHQVXUHDFRQVHUYDWLYHRYHUFRROLQJ

LVREWDLQHG



,QLWVUHVSRQVHWR5$,DQGE\\OHWWHUGDWHG-XQHWKHOLFHQVHHVWDWHGWKDWWKHWLPH

IUDPHGXULQJZKLFKWKH'1%5LVRIFRQFHUQLVSULRUWRWKHFRPSOHWLRQRIFRQWUROURGLQVHUWLRQ

7KHVFHQDULRVLQZKLFK5&3VDUHDVVXPHGWRORVHSRZHUDQGFRDVWGRZQERXQGWKHVFHQDULRV

LQZKLFKWKH\\UHPDLQLQRSHUDWLRQ7KHOLFHQVHHVWDWHG



)RUVFHQDULRVZKHUHRIIVLWHSRZHUUHPDLQVDYDLODEOHDQGWKH5&3VUHPDLQ

RSHUDWLQJWKHPDVVIORZHQWHULQJWKHFRUHLQFUHDVHVDVWKHFRUHLQOHW

WHPSHUDWXUHGHFUHDVHV7KHSRWHQWLDOGHFUHDVHLQFRUHH[LWSUHVVXUHLVOLPLWHGE\\

WKHOLTXLGVDWXUDWLRQWHPSHUDWXUH7KHOLPLWLQJ'1%5GXULQJWKLVWLPHIUDPH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











RFFXUVZKHQWKHFRUHLQOHWPDVVIORZGHFUHDVHV>GXHWRKLJKHUWHPSHUDWXUH

ORZHUGHQVLW\\ FRUHLQOHWIORZLQWKH5&3VWULSDQGFRDVWGRZQVFHQDULR@ZKLOH

FRUHGLVFKDUJHSUHVVXUHGHFUHDVHVEHIRUHWKHKHDWIOX[IURPWKHIXHOKDVWLPHWR

GHFD\\



7KHOLPLWLQJFDVHWKDWFKDOOHQJHVDUHWXUQWRFULWLFDOLW\\IRUWKHGRXEOH06+(/%ZLWKWKH

9$&HTXLSPHQWDYDLODEOHLVZLWKWKH5&3VUXQQLQJ



2SHUDWRU$FWLRQV



x

7ULSWKHRSHUDWLQJ5&3VDWPLQXWHVDIWHUDORVVRILQGLFDWHGVXEFRROHGPDUJLQ

x

,VRODWH():IORZWRWKHDIIHFWHGVWHDPJHQHUDWRUDWPLQXWHV



5HVXOWV



x

5HDFWRUGRHVQRWUHWXUQWRFULWLFDOLW\\

x

5&6SUHVVXUHDQGWHPSHUDWXUHUHPDLQVZLWKLQWKHDFFHSWDEOHFRROGRZQOLPLWVGXULQJWKH

WUDQVLHQW5&6VXEFRROLQJDVDIXQFWLRQRIWLPHLQGLFDWHVWKDWWKHVXEFRROHGPDUJLQ

UHPDLQVOHVVWKDQ)IRUWKHGXUDWLRQRIWKHOLPLWLQJFDVHZKLFKLVOHVVWKDQWKH)

VXEFRROHGVFUHHQLQJFULWHULD

x

7KHDQDO\\VLVUHVXOWVLQDOLPLWLQJWXEHWRVKHOO7RI)7KHUHIRUHWKH6*WXEH

VWUHVVHVZKLFKDUHEDVHGRQWXEHWRVKHOO7RI)DUHERXQGHGE\\WKH6*WXEH

VWUHVVHVEDVHGRQ7RI)LQGXFHGGXULQJDODUJHEUHDN/2&$DQGDUHWKHUHIRUH

EHORZWKHLUGHVLJQOLPLWV



7KH15&VWDIIILQGVLWDFFHSWDEOHWKDWE\\XVLQJ15&DFFHSWHGPHWKRGRORJ\\FRQVHUYDWLYHLQLWLDO

FRQGLWLRQVDVVXPSWLRQVDQGDFFHSWHGRSHUDWRUDFWLRQVWKHOLFHQVHHGHPRQVWUDWHGWKDW D 

5&6LQWHJULW\\LVPDLQWDLQHGEHFDXVHWKH6*WXEHFRPSUHVVLYHDQGWHQVLOHVWUHVVHVDUHZLWKLQ

WKHLUGHVLJQOLPLWVDQG E PLQLPXP'1%5PHHWVWKHDFFHSWDEOHIXHOGHVLJQOLPLWV%DVHGRQ

WKHDERYHDQGWKH06+(/%PLWLJDWLRQDFFHSWDQFHFULWHULDLQ6HFWLRQEHLQJPHWWKH

15&VWDIIILQGVWKDWWKHGRXEOH06+(/%LQWKH7%FDQEHPLWLJDWHGXVLQJWKHQRUPDOSODQW

HTXLSPHQW





'RXEOH06+(/%LQWKH7%/2239$&3RZHU$YDLODEOH



7KHDQDO\\VLVDVVXPHVDGRXEOHHQGHGJXLOORWLQHEUHDNRIERWK06OLQHVLQWKH7%PLWLJDWHGE\\

QRUPDOSODQWHTXLSPHQWDVWKHHPHUJHQF\\9$&SRZHUUHPDLQVDYDLODEOH,QWKLV+(/%

VFHQDULR/223LVDVVXPHGWRFRLQFLGHZLWKWKHGRXEOH06+(/%VDQG9$&SRZHULV

DYDLODEOH$VVWDWHGLQ8)6$56HFWLRQ/223WULSVWKHUHDFWRUFDXVHVWKH5&3VWR

FRDVWGRZQDQGIORZLVORVWZKLOHGHSUHVVXUL]DWLRQLVRFFXUULQJ7KHPLQLPXP'1%5VWDWH

SRLQWRFFXUVZLWKLQWKHILUVWIHZVHFRQGVRIWKH5&3FRDVWGRZQWKHUHIRUHWKHGXUDWLRQRIWKH

'1%5DQDO\\VLVLVVHFRQGV7KHOLFHQVHHDQDO\\]HGWKLVVFHQDULRXVLQJ5(75$1'216

PHWKRGRORJ\\7KHOLFHQVHHVWDWHGWKDWWKLVVFHQDULRLVVLPLODUWRWKHGHVFULSWLRQSURYLGHGLQ

8)6$56HFWLRQIRU06/%DQDO\\VLVZLWKUHVSHFWWRWKHLQLWLDODQGERXQGDU\\FRQGLWLRQVIRU

WKHFDVHZLWKRXWRIIVLWHSRZHUDYDLODEOH7KHSULPDU\\GLIIHUHQFHLVERWK6*VH[SHULHQFHDQ

XQFRQWUROOHGGHSUHVVXUL]DWLRQLQWKH06+(/%DQDO\\VLV



,QLWLDO&RQGLWLRQV



x

9$&SRZHULVDYDLODEOH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











x

5HDFWRUWKHUPDOSRZHUSHUFHQWRI0:WDW+)3FRQGLWLRQV

x

6LQJOHDFWLYHIDLOXUH



$VVXPSWLRQV



x

'HFD\\KHDWLVDFFRUGLQJWR$16ZLWKDVXQFHUWDLQW\\

x

/223LVFRLQFLGHQWZLWKWKHGRXEOH06+(/%LQWKH7%

x

$VHFRQGWUDQVLHQWDQDO\\VLVLPPHGLDWHO\\DIWHUUHDFWRUWULSLVVXIILFLHQWWRGHWHUPLQHWKH

PLQLPXP'1%5EHFDXVHWKLVFDVHLVFRQVLGHUHGWREHERXQGHGE\\WKHGRXEOH06+(/%

FDVHHYDOXDWHGLQ6HFWLRQDERYHIRUWKHHIIHFWVRQFRUHUHDFWLYLW\\DQGWKHSRWHQWLDORI

UHWXUQWRFULWLFDOLW\\



2SHUDWRU$FWLRQV



x

7ULSWKHRSHUDWLQJ5&3VPLQXWHVDIWHUDORVVRILQGLFDWHGVXEFRROHGPDUJLQ

x

,VRODWH():IORZWRWKHDIIHFWHGVWHDPJHQHUDWRUDWPLQXWHV



5HVXOWV



x

7KHUHDFWRUGRHVQRWUHWXUQWRFULWLFDOLW\\

x

7UDQVLHQWUHVXOWVIRU5&6VXEFRROLQJVKRZVXEFRROHGPDUJLQOHVVWKDQ)IRUWKH

GXUDWLRQRIWKHOLPLWLQJFDVHZKLFKLVOHVVWKDQWKHVXEFRROHGVFUHHQLQJFULWHULDRI)

x

7KHPLQLPXP'1%5LVZLWKLQDFFHSWDEOHOLPLWV

x

5&6SUHVVXUHDQGWHPSHUDWXUHUHPDLQZLWKLQWKHDFFHSWDEOHFRROGRZQOLPLWVGXULQJWKH

WUDQVLHQW

x

7KHDQDO\\VLVUHVXOWVLQDOLPLWLQJWXEHWRVKHOO7RI)7KHUHIRUHWKH6*WXEH

WHQVLOHVWUHVVHVZKLFKDUHEDVHGRQWXEHWRVKHOO7RI)DUHERXQGHGE\\WKH6*

WXEHWHQVLOHVWUHVVHVEDVHGRQ7RI)LQGXFHGGXULQJDODUJHEUHDN/2&$DQGDUH

WKHUHIRUHEHORZWKHLUGHVLJQOLPLWV



7KH15&VWDIIILQGVLWDFFHSWDEOHWKDWE\\XVLQJ15&DFFHSWHGPHWKRGRORJ\\FRQVHUYDWLYHLQLWLDO

FRQGLWLRQVDVVXPSWLRQVDQGDFFHSWHGRSHUDWRUDFWLRQVWKHOLFHQVHHGHPRQVWUDWHGWKDW

D 5&6LQWHJULW\\LVPDLQWDLQHGEHFDXVHWKH6*WXEHFRPSUHVVLYHDQGWHQVLOHVWUHVVHVDUH

ZLWKLQWKHLUGHVLJQOLPLWVDQG E PLQLPXP'1%5PHHWVWKHDFFHSWDEOHIXHOGHVLJQOLPLWV

%DVHGRQWKHDERYHDQGWKH06+(/%PLWLJDWLRQDFFHSWDQFHFULWHULDLQ6HFWLRQEHLQJ

PHWWKH15&VWDIIILQGVWKDWWKHGRXEOH06+(/%LQWKH7%LQWKHSUHVHQFHRI/223FDQEH

PLWLJDWHGXVLQJWKHQRUPDOSODQWHTXLSPHQW





6LQJOH06+(/%LQWKH7%9$&3RZHU8QDYDLODEOH66)0LWLJDWLRQ



,QWKHDQDO\\VLVRIVLQJOH06+(/%LQWKH7%ZLWKDGRXEOHHQGHGJXLOORWLQHEUHDNVFHQDULRWKH

9$&SRZHULVDVVXPHGWREHXQDYDLODEOH7KHOLFHQVHHXVHG5(/$302'% :216

PHWKRGRORJ\\IRUWKHFRUHSRZHUUHVSRQVHDQG9,35(PHWKRGRORJ\\IRUWKH'1%5DQDO\\VLV



,QLWLDO&RQGLWLRQV



x

9$&SRZHULVXQDYDLODEOH

x

5HDFWRUWKHUPDOSRZHUSHUFHQWRI0:WDW+)3FRQGLWLRQV

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











$VVXPSWLRQV



x

'HFD\\KHDWLVDFFRUGLQJWR$16ZLWKDVXQFHUWDLQW\\

x

1RFUHGLWIRU$),6

x

,PPHGLDWHUHDFWRUDQGWXUELQHWULSWRREWDLQWKHOLPLWLQJFRUHUHVSRQVH

x

7ULSRIDOOFRQGHQVDWHDQG0)':SXPSV

x

7KHPRWRUGULYHQ():SXPSVDUHQRWDYDLODEOHGXHWRWKHORVVRI9$&SRZHU

x

7RFRQVHUYDWLYHO\\PD[LPL]HRYHUFRROLQJWKHWXUELQHGULYHQ():SXPSLVDVVXPHGWR

DXWRPDWLFDOO\\VWDUWDQGUXQZLWKRXWEHLQJWKURWWOHGXQWLOWKHFRQWHQWVRIWKH867DUHGHOLYHUHG

WRWKH6*V



6HQVLWLYLW\\&DVH



7KHOLFHQVHHDOVRDQDO\\]HGDVHQVLWLYLW\\FDVHWKDWGRHVQRWFUHGLWERURQDGGHGE\\WKH66)

5&08SXPS



2SHUDWRU$FWLRQV



7KHIROORZLQJRSHUDWRUDFWLRQVDUHFUHGLWHGLQWKHDQDO\\VLV



x

5&3VVHFXUHGDWPLQXWHVDIWHUORVVRI5&3VHDOFRROLQJRUPLQXWHVDIWHUDORVVRI

LQGLFDWHGVXEFRROLQJ

x

66)5&08SXPSLVFUHGLWHGWRUHVWRUH5&3VHDOFRROLQJDWPLQXWHV

x

,VRODWLRQRIQRUPDOOHWGRZQLVFUHGLWHGDWPLQXWHV

x

7KH66)SRZHUHGSUHVVXUL]HUKHDWHUVDUHDYDLODEOHDWPLQXWHVEXWDUHQRWHQHUJL]HG

XQWLOSUHVVXUL]HUOHYHOUHFRYHUVVXIILFLHQWO\\>>

@@

x

>>



@@

x

,QLWLDWH66)RSHUDWLRQDVGHVFULEHGLQ6HFWLRQRIWKH/$5

5HVXOWV

x

7KHFRUHUHPDLQVFRYHUHGLQWDFWDQGVXEFRROHGGXULQJWKHUHWXUQWRSRZHUZLWKDGHTXDWH

'1%PDUJLQ

x

0LQLPXP'1%5UHVXOWLVDFFHSWDEOH

x

/DUJH'1%PDUJLQH[LVWVIRUWKHVWDWHSRLQWDWWKHSHDNKHDWIOX[GXULQJWKHUHWXUQWRFULWLFDO

SRUWLRQRIWKHWUDQVLHQW

x

5(/$302'% :216FRUHSRZHUUHVSRQVHFDOFXODWLRQLVFRQVHUYDWLYH LHKLJKHU

UHWXUQWRSRZHU FRPSDUHGWR6.FDOFXODWLRQ

x

7KH6*WXEHVUHPDLQLQWDFW

x

5&6UHPDLQVZLWKLQDFFHSWDEOHSUHVVXUHDQGWHPSHUDWXUHOLPLWV

x

0LQLPXPFROGOHJWHPSHUDWXUHVGRQRWDSSURDFKWKHQLOGXFWLOLW\\WHPSHUDWXUH 1'7 FXUYHV

x

7KHPD[LPXP6*WXEHFRPSUHVVLYHVWUHVVHVDUHEDVHGRQWXEHWRVKHOO7RI)DQG

)IRUORRSV$DQG%UHVSHFWLYHO\\ZKLFKDUHZHOOEHORZWKHFRPSUHVVLYHVWUHVVOLPLW

EDVHGRQ7RI)

x

7KHPD[LPXP6*WXEHWHQVLOHVWUHVVHVDUHEDVHGWXEHWRVKHOO7RI)DQG)

IRUORRSV$DQG%UHVSHFWLYHO\\ZKLFKDUHZHOOEHORZWKHWHQVLOHVWUHVVOLPLWEDVHGRQ7

RI)

x

7KHUHVXOWVRIWKHVHQVLWLYLW\\FDVHGHVFULEHGDERYHVKRZHGWKDWPD[LPXPFRUHSRZHUOHYHO

UHDFKHGWRSHUFHQWSRZHUDWVHFRQGV7KHFRUHH[LWVXEFRROLQJEHWZHHQDQG

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











VHFRQGVLVJUHDWHUWKDQ)DQGFRQVLVWHQWO\\JUHDWHUWKDQ)VXEFRROHGGXULQJ

WKHUHWXUQWRSRZHU



7KH15&VWDIIILQGVLWDFFHSWDEOHWKDWE\\XVLQJ15&DFFHSWHGPHWKRGRORJ\\FRQVHUYDWLYHLQLWLDO

FRQGLWLRQVDVVXPSWLRQVDQGDFFHSWHGRSHUDWRUDFWLRQVWKHOLFHQVHHGHPRQVWUDWHGWKDW D 

5&6LQWHJULW\\LVPDLQWDLQHGEHFDXVHWKH6*WXEHFRPSUHVVLYHDQGWHQVLOHVWUHVVHVDUHZLWKLQ

WKHLUGHVLJQOLPLWVDQG E PLQLPXP'1%5PHHWVWKHDFFHSWDEOHIXHOGHVLJQOLPLWV%DVHGRQ

WKHDERYHDQGWKH06+(/%PLWLJDWLRQDFFHSWDQFHFULWHULDLQ6HFWLRQEHLQJPHWWKH

15&VWDIIILQGVWKDWWKH5&6RYHUFRROLQJGXHWRVLQJOH06+(/%LQWKH7%FDQEHPLWLJDWHG

XVLQJWKH66)HTXLSPHQW



'RXEOH06+(/%LQWKH7%9$&3RZHU8QDYDLODEOH66)0LWLJDWLRQ

,QWKHDQDO\\VLVRIWKHGRXEOH06+(/%LQWKH7%ZLWKGRXEOHHQGHGJXLOORWLQHEUHDNLQERWK

OLQHVWKH9$&SRZHULVDVVXPHGWREHXQDYDLODEOH7KHOLFHQVHHXVHG5(/$302'

% :216PHWKRGRORJ\\IRUWKHFRUHSRZHUUHVSRQVHDQG9,35(PHWKRGRORJ\\IRUWKH'1%5

DQDO\\VLV



,QLWLDO&RQGLWLRQV



x

9$&SRZHULVXQDYDLODEOH

x

5HDFWRUWKHUPDOSRZHUSHUFHQWRI0:WDW+)3FRQGLWLRQV



$VVXPSWLRQV



x

'HFD\\KHDWLVDFFRUGLQJWR$16ZLWKDVXQFHUWDLQW\\

x

1RFUHGLWIRU$),6

x

,PPHGLDWHUHDFWRUDQGWXUELQHWULSJLYHVWKHOLPLWLQJFRUHUHVSRQVH

x

7ULSRIDOOFRQGHQVDWHDQG0)':SXPSV

x

7KHPRWRUGULYHQ():SXPSVDUHQRWDYDLODEOHGXHWRWKHORVVRI9$&SRZHU

x

7RFRQVHUYDWLYHO\\PD[LPL]HRYHUFRROLQJWKHWXUELQHGULYHQ():SXPSLVDVVXPHGWR

DXWRPDWLFDOO\\VWDUWDQGUXQZLWKRXWEHLQJWKURWWOHGXQWLOWKHFRQWHQWVRIWKH867DUHGHOLYHUHG

WRWKH6*V



2SHUDWRU$FWLRQV



7KHIROORZLQJRSHUDWRUDFWLRQVDUHFUHGLWHGLQWKHDQDO\\VLV



x

5&3VVHFXUHGDWPLQXWHVDIWHUORVVRI5&3VHDOFRROLQJRUPLQXWHVDIWHUDORVVRI

LQGLFDWHGVXEFRROLQJ

x

66)5&08SXPSLVFUHGLWHGWRUHVWRUH5&3VHDOFRROLQJDWPLQXWHV

x

,VRODWLRQRIQRUPDOOHWGRZQLVFUHGLWHGDWPLQXWHV

x

7KH66)SRZHUHGSUHVVXUL]HUKHDWHUVDUHDYDLODEOHDWPLQXWHVEXWDUHQRWHQHUJL]HG

XQWLOSUHVVXUL]HUOHYHOUHFRYHUVVXIILFLHQWO\\>>

@@

x

2SHUDWRUVLQLWLDOO\\FRQWURO66)$6:IORZWRVWDELOL]HSUHVVXUL]HUOHYHOZKLFKSUHYHQWVWKH

SUHVVXUL]HUIURPGHYHORSLQJLQWRDZDWHUVROLGFRQGLWLRQ7KHOLFHQVHHVWDWHGWKDWWKH

RSHUDWRUJXLGDQFHDVVXPHGLQWKHDQDO\\VLVLVWRVWDELOL]HWKH5&6WHPSHUDWXUHEHWZHHQ

)WR)DQGLWVSUHVVXUHEHWZHHQSVLJWRSVLJ7KHOLFHQVHHVWDWHGWKH

IROORZLQJDGYDQWDJHVLQPDLQWDLQLQJWKHVHFRQGLWLRQV

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











o 7KH5&6ZRXOGEHLQQDWXUDOFLUFXODWLRQZLWKDVXEFRROHGPDUJLQFRQVLVWHQWZLWKWKH

QRUPDOQDWXUDOFLUFXODWLRQJXLGDQFH )LQGLFDWHGVXEFRROLQJ 

o 66)$6:ZRXOGEHFRQWUROOHGWRPDLQWDLQDFRQVWDQWFROGOHJWHPSHUDWXUHZLWK

SUHVVXUL]HUKHDWHUVDQG66)OHWGRZQDYDLODEOHWRFRQWURO5&6SUHVVXUH

o %HORZ)5&3VHDOLQWHJULW\\ZRXOGQRWEHUHDGLO\\FKDOOHQJHGVKRXOGVHDO

LQMHFWLRQIORZEHLQWHUUXSWHG

o 5HPDLQLQJDERYHSVLDOORZVWLPHWRLVRODWHWKHFRUHIORRGWDQNV &)7V DQG

SUHYHQWQLWURJHQLQMHFWLRQ

o 6KRXOGWKHSUHVVXUL]HUEHFRPHZDWHUVROLGDWWKHVHFRQGLWLRQVWKHUHLVDVLJQLILFDQW

DPRXQWRIPDUJLQWROLIWLQJWKHSUHVVXUL]HUFRGHVDIHW\\YDOYHV SVLJVHWSRLQW 

o 7KHFRPSUHVVLYHWXEHVWUHVVDQDO\\WLFDOOLPLWLVGHILQHGE\\WKH5&6DW)DQGWKH

6*VKHOODW)7KHFRROGRZQWREHORZ)ZLOOSURYLGHPDUJLQWRSUHYHQWWXEH

GHIRUPDWLRQ

o 'XULQJWKHFRROGRZQVXIILFLHQWERURQLVDGGHGWRHQVXUHWKDWWKHFRUHUHPDLQV

VXEFULWLFDOGRZQWR)ZLWKRXWFUHGLWIRU;HQRQ



x

>>



@@



5HVXOWV



x

$VKRUWUHWXUQWRFULWLFDOLW\\RFFXUVDIWHUVHFRQGVZKLFKUHVXOWVLQDILVVLRQSRZHU

LQFUHDVHWRZDWWDSSUR[LPDWHO\\

x

7KHFRUHUHPDLQVFRYHUHGLQWDFWDQGVXEFRROHGGXULQJWKHUHWXUQWRSRZHUZLWKDGHTXDWH

'1%PDUJLQ

x

0LQLPXP'1%5UHVXOWLVDFFHSWDEOH

x

5(/$302'% :216FRUHSRZHUUHVSRQVHFDOFXODWLRQLVFRQVHUYDWLYH LHKLJKHU

UHWXUQWRSRZHU FRPSDUHGWR6.FDOFXODWLRQ

x

7KH6*WXEHVUHPDLQLQWDFW

x

5&6UHPDLQVZLWKLQDFFHSWDEOHSUHVVXUHDQGWHPSHUDWXUHOLPLWVZLWKVLJQLILFDQWPDUJLQ

x

0LQLPXPFROGOHJWHPSHUDWXUHVGRQRWDSSURDFKWKH1'7FXUYHV

x

7KHPD[LPXP6*WXEHFRPSUHVVLYHVWUHVVHVDUHEDVHGRQWXEHWRVKHOO7RI)DQG

)IRUORRSV$DQG%UHVSHFWLYHO\\7KHVWUHVVYDOXHVDUHZHOOEHORZWKHFRPSUHVVLYH

VWUHVVOLPLWEDVHGRQ7RI)

x

7KHPD[LPXP6*WXEHWHQVLOHVWUHVVHVDUHEDVHGRQWXEHWRVKHOO7RI)DQG

)IRUORRSV$DQG%UHVSHFWLYHO\\7KHVHYDOXHVDUHZHOOEHORZWKHWHQVLOHVWUHVVOLPLW

EDVHGRQ7RI)



7KH15&VWDIIILQGVLWDFFHSWDEOHWKDWE\\XVLQJ15&DFFHSWHGPHWKRGRORJ\\FRQVHUYDWLYHLQLWLDO

FRQGLWLRQVDVVXPSWLRQVDQGDFFHSWHGRSHUDWRUDFWLRQVWKHOLFHQVHHGHPRQVWUDWHGWKDW D 

5&6LQWHJULW\\LVPDLQWDLQHGEHFDXVHWKH6*WXEHFRPSUHVVLYHDQGWHQVLOHVWUHVVHVDUHZLWKLQ

WKHLUGHVLJQOLPLWVDQG E PLQLPXP'1%5PHHWVWKHDFFHSWDEOHIXHOGHVLJQOLPLWV%DVHGRQ

WKHDERYHDQGWKH06+(/%PLWLJDWLRQDFFHSWDQFHFULWHULDLQ6HFWLRQEHLQJPHWWKH

15&VWDIIILQGVWKDWWKHGRXEOH06+(/%LQWKH7%FDQEHPLWLJDWHGXVLQJWKH66)HTXLSPHQW





6LQJOH06+(/%LQWKH7%9$&3RZHU8QDYDLODEOH36:0LWLJDWLRQ



,QWKHDQDO\\VLVRIWKHVLQJOH06+(/%LQWKH7%ZLWKDGRXEOHHQGHGJXLOORWLQHEUHDNWKH

9$&SRZHULVDVVXPHGWREHXQDYDLODEOH7KHOLFHQVHHXVHG5(/$302'% :216DQG

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











6.PHWKRGRORJLHVIRUWKHFRUHSRZHUUHVSRQVHDQG9,35(PHWKRGRORJ\\IRUWKH'1%5

DQDO\\VLV



,QLWLDO&RQGLWLRQV



x

9$&SRZHULVXQDYDLODEOH

x

5HDFWRUWKHUPDOSRZHUSHUFHQWRI0:WDW+)3FRQGLWLRQV



$VVXPSWLRQV



x

'HFD\\KHDWLVDFFRUGLQJWR$16ZLWKDVXQFHUWDLQW\\

x

36:SURYLGHVWKHKHDWVLQN

x

1RFUHGLWIRU$),6

x

,PPHGLDWHUHDFWRUDQGWXUELQHWULSIRUWKHOLPLWLQJFRUHUHVSRQVH

x

7ULSRIDOOFRQGHQVDWHDQG0)':SXPSV

x

7KHPRWRUGULYHQ():SXPSVDUHQRWDYDLODEOHGXHWRWKHORVVRI9$&SRZHU

x

7RFRQVHUYDWLYHO\\PD[LPL]HRYHUFRROLQJWKHWXUELQHGULYHQ():SXPSLVDVVXPHGWR

DXWRPDWLFDOO\\VWDUWDQGUXQZLWKRXWEHLQJWKURWWOHGXQWLOWKHFRQWHQWVRIWKH867DUHGHOLYHUHG

WRWKH6*V

x

7KH36:SRZHUHG+3,SXPSSURYLGHV5&6PDNHXSIORZDQGUHVWRUHV5&3VHDOLQMHFWLRQ

IORZIURPWKH%:67



2SHUDWRU$FWLRQV



7KHIROORZLQJRSHUDWRUDFWLRQVDUHFUHGLWHGLQWKHDQDO\\VLV



x

5&3VVHFXUHGDWPLQXWHVDIWHUORVVRI5&3VHDOFRROLQJ

x

,VRODWHWKHQRUPDOOHWGRZQIORZSDWKDWPLQXWHVDQGVWDUWD36:SRZHUHG+3,SXPSWR

UHVWRUH5&3VHDOFRROLQJDWPLQXWHV

x

36:SXPSIORZLVDYDLODEOHDWPLQXWHVEXWQRWDOLJQHGXQWLO5&6WHPSHUDWXUHVUHFRYHU

WRFRQWUROFRUHH[LWWKHUPRFRXSOHV &(7&V WRWKHGHVLUHGVHWSRLQWRI)

x

7KH36:SRZHUHGSUHVVXUL]HUKHDWHUVDUHDYDLODEOHDWPLQXWHVEXWDUHQRWHQHUJL]HG

XQWLOSUHVVXUL]HUOHYHOUHFRYHUV

x

7KH36:OHWGRZQSDWKIURPWKH5&6LVWKURXJKWKHUHDFWRUYHVVHOKHDGYHQW 59+9 DQG

ORRS+39

x

7KH59+9LVRSHQHG>>



@@

x

>>

@@DQGLVVXEVHTXHQWO\\F\\FOHGWRPDLQWDLQD

LQFKSUHVVXUL]HUOHYHOEDQG



5HVXOWV



x

7KHFRUHUHPDLQVFRYHUHGFRROHGDQGVXEFULWLFDODIWHUWKHFRQWUROURGVLQVHUWLRQ

x

5&6UHPDLQVZLWKLQDFFHSWDEOHSUHVVXUHDQGWHPSHUDWXUHOLPLWV

x

0LQLPXP'1%5UHVXOWLVDFFHSWDEOH

x

5(/$302'% :216FRUHSRZHUUHVSRQVHFDOFXODWLRQLVFRQVHUYDWLYH LHKLJKHU

UHWXUQWRSRZHU FRPSDUHGWR6.FDOFXODWLRQ

x

0LQLPXPFROGOHJWHPSHUDWXUHVGRQRWDSSURDFKWKH1'7FXUYHV

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











x

7KHPD[LPXP6*WXEHFRPSUHVVLYHVWUHVVHVDUHEDVHGRQWXEHWRVKHOO7RI)DQG

)IRUORRSV$DQG%UHVSHFWLYHO\\7KHVHYDOXHVDUHZHOOEHORZWKHFRPSUHVVLYHVWUHVV

OLPLWEDVHGRQ7RI)

x

7KHPD[LPXP6*WXEHWHQVLOHVWUHVVHVDUHEDVHGRQWXEHWRVKHOO7RI)

DQG)IRUORRSV$DQG%UHVSHFWLYHO\\7KHVHYDOXHVDUHZHOOEHORZWKHWHQVLOHVWUHVV

OLPLWEDVHGRQ7RI)



7KH15&VWDIIILQGVLWDFFHSWDEOHWKDWE\\XVLQJ15&DFFHSWHGPHWKRGRORJ\\FRQVHUYDWLYHLQLWLDO

FRQGLWLRQVDVVXPSWLRQVDQGDFFHSWHGRSHUDWRUDFWLRQVWKHOLFHQVHHGHPRQVWUDWHGWKDW D 

5&6LQWHJULW\\LVPDLQWDLQHGEHFDXVHWKH6*WXEHFRPSUHVVLYHDQGWHQVLOHVWUHVVHVDUHZLWKLQ

WKHLUGHVLJQOLPLWVDQG E PLQLPXP'1%5PHHWVWKHDFFHSWDEOHIXHOGHVLJQOLPLWV%DVHGRQ

WKHDERYHDQGWKH06+(/%PLWLJDWLRQDFFHSWDQFHFULWHULDLQ6HFWLRQEHLQJPHWWKH

15&VWDIIILQGVWKDWWKHVLQJOH06+(/%LQWKH7%FDQEHPLWLJDWHGXVLQJWKH36:V\\VWHP



'RXEOH06+(/%LQWKH7%9$&3RZHU8QDYDLODEOH36:0LWLJDWLRQ

,QWKHDQDO\\VLVRIWKHGRXEOH06+(/%LQWKH7%ZLWKGRXEOHHQGHGJXLOORWLQHEUHDNLQERWK

OLQHVWKH9$&SRZHULVDVVXPHGWREHXQDYDLODEOH7KHOLFHQVHHXVHG5(/$302'

% :216PHWKRGRORJ\\IRUWKHFRUHSRZHUUHVSRQVHDQG9,35(PHWKRGRORJ\\IRUWKH'1%5

DQDO\\VLV



,QLWLDO&RQGLWLRQV



x

9$&SRZHULVXQDYDLODEOH

x

5HDFWRUWKHUPDOSRZHUSHUFHQWRI0:WDW+)3FRQGLWLRQV



$VVXPSWLRQV



x

'HFD\\KHDWLVDFFRUGLQJWR$16ZLWKDVXQFHUWDLQW\\

x

36:SURYLGHVWKHKHDWVLQN

x

1RFUHGLWIRU$),6

x

,PPHGLDWHUHDFWRUDQGWXUELQHWULSIRUWKHOLPLWLQJUHVSRQVH

x

7ULSRIDOOFRQGHQVDWHDQG0)':SXPSV

x

7KHPRWRUGULYHQ():SXPSVDUHQRWDYDLODEOHGXHWRWKHORVVRI9$&SRZHU

x

7RFRQVHUYDWLYHO\\PD[LPL]HRYHUFRROLQJWKHWXUELQHGULYHQ():SXPSLVDVVXPHGWR

DXWRPDWLFDOO\\VWDUWDQGUXQZLWKRXWEHLQJWKURWWOHGXQWLOWKHFRQWHQWVRIWKH867DUHGHOLYHUHG

WRWKH6*V

x

7KH36:SRZHUHG+3,SXPSSURYLGHV5&6PDNHXSIORZDQGUHVWRUH5&3VHDOLQMHFWLRQ

IORZIURPWKH%:67

x

7KHSUHVVXUL]HUKHDWHUVDUHXVHGWRPDLQWDLQ)FRUHH[LWWHPSHUDWXUH &(7 VXEFRROLQJ



2SHUDWRU$FWLRQV



7KHIROORZLQJRSHUDWRUDFWLRQVDUHFUHGLWHGLQWKHDQDO\\VLV



x

5&3VVHFXUHGDWPLQXWHVDIWHUORVVRI5&3VHDOFRROLQJ

x

,VRODWHWKHQRUPDOOHWGRZQIORZSDWKDWPLQXWHVDQGVWDUWD36:SRZHUHG+3,SXPSWR

UHVWRUH5&3VHDOFRROLQJDWPLQXWHV

x

36:SXPSIORZLVDYDLODEOHDWPLQXWHVEXWQRWDOLJQHGXQWLO5&6WHPSHUDWXUHVUHFRYHU

WRFRQWURO&(7&VWRWKHGHVLUHGVHWSRLQWRI)

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











x

>>

@@DQGLVVXEVHTXHQWO\\F\\FOHGWRPDLQWDLQD

LQFKSUHVVXUL]HUOHYHOEDQG

x

2SHUDWRUVLQLWLDOO\\FRQWURO36:IORZWRVWDELOL]H&(77KHOLFHQVHHVWDWHGWKDWWKHRSHUDWRU

JXLGDQFHDVVXPHGLQWKHDQDO\\VLVLVWRVWDELOL]HWKH5&6WHPSHUDWXUHEHWZHHQR)WR

R)DQGLWVSUHVVXUHEHWZHHQSVLJWRSVLJ7KHOLFHQVHHVWDWHGWKHIROORZLQJ

DGYDQWDJHVLQPDLQWDLQLQJWKHVHFRQGLWLRQV



o 7KH5&6ZRXOGEHLQQDWXUDOFLUFXODWLRQZLWKDVXEFRROHGPDUJLQFRQVLVWHQWZLWKWKH

QRUPDOQDWXUDOFLUFXODWLRQJXLGDQFH )LQGLFDWHGVXEFRROLQJ 

o 36:ZRXOGEHFRQWUROOHGWRPDLQWDLQDFRQVWDQWFROGOHJWHPSHUDWXUHZLWK

SUHVVXUL]HUKHDWHUVDQG5&6KHDGDQGORRSYHQWYDOYHVDYDLODEOHWRFRQWURO5&6

SUHVVXUH

o %HORZ)5&3VHDOLQWHJULW\\ZRXOGQRWEHUHDGLO\\FKDOOHQJHGVKRXOGVHDO

LQMHFWLRQIORZEHLQWHUUXSWHG

o 5HPDLQLQJDERYHSVLDOORZVWLPHWRLVRODWHWKH&)7VDQGSUHYHQWQLWURJHQ

LQMHFWLRQ

o 6KRXOGWKHSUHVVXUL]HUEHFRPHZDWHUVROLGDWWKHVHFRQGLWLRQVWKHUHLVDVLJQLILFDQW

DPRXQWRIPDUJLQWROLIWLQJWKHSUHVVXUL]HUFRGHVDIHW\\YDOYHV SVLJVHWSRLQW 

o 7KHFRPSUHVVLYHWXEHVWUHVVDQDO\\WLFDOOLPLWLVGHILQHGE\\WKH5&6DW)DQGWKH

6*VKHOODW)7KHFRROGRZQWREHORZ)ZLOOSURYLGHPDUJLQWRSUHYHQWWXEH

GHIRUPDWLRQ

o 'XULQJWKHFRROGRZQVXIILFLHQWERURQLVDGGHGWRHQVXUHWKDWWKHFRUHUHPDLQV

VXEFULWLFDOGRZQWR)ZLWKRXWFUHGLWIRU;HQRQ



x

7KH36:SRZHUHGSUHVVXUL]HUKHDWHUVDUHDYDLODEOHDWPLQXWHVEXWDUHQRWHQHUJL]HG

XQWLOSUHVVXUL]HUOHYHOUHFRYHUVVXIILFLHQWO\\>>

@@

x

7KH59+9LVRSHQHG>>



@@



5HVXOWV



x

7KHFRUHUHPDLQVFRYHUHGFRROHGDQGVXEFULWLFDODIWHUWKHFRQWUROURGVLQVHUWLRQ

x

5&6UHPDLQVZLWKLQDFFHSWDEOHSUHVVXUHDQGWHPSHUDWXUHOLPLWV

x

0LQLPXP'1%5UHVXOWLVDFFHSWDEOH

x

5(/$302'% :216FRUHSRZHUUHVSRQVHFDOFXODWLRQLVFRQVHUYDWLYH LHKLJKHU

UHWXUQWRSRZHU FRPSDUHGWR6.FDOFXODWLRQ

x

0LQLPXPFROGOHJWHPSHUDWXUHVGRQRWDSSURDFKWKH1'7FXUYHV

x

7KHPD[LPXP6*WXEHFRPSUHVVLYHVWUHVVHVDUHEDVHGRQWXEHWRVKHOO7RI)DQG

)IRUORRSV$DQG%UHVSHFWLYHO\\7KHVWUHVVYDOXHVDUHZHOOEHORZWKHFRPSUHVVLYH

VWUHVVOLPLWEDVHGRQ7RI)

x

7KHPD[LPXP6*WXEHWHQVLOHVWUHVVHVDUHEDVHGRQWXEHWRVKHOO7RI)DQG

)IRUORRSV$DQG%UHVSHFWLYHO\\7KHVWUHVVYDOXHVDUHZHOOEHORZWKHWHQVLOHVWUHVV

OLPLWEDVHGRQ7RI)



7KH15&VWDIIILQGVLWDFFHSWDEOHWKDWE\\XVLQJ15&DFFHSWHGPHWKRGRORJ\\FRQVHUYDWLYHLQLWLDO

FRQGLWLRQVDVVXPSWLRQVDQGDFFHSWHGRSHUDWRUDFWLRQVWKHOLFHQVHHGHPRQVWUDWHGWKDW D 

5&6LQWHJULW\\LVPDLQWDLQHGEHFDXVHWKH6*WXEHFRPSUHVVLYHDQGWHQVLOHVWUHVVHVDUHZLWKLQ

WKHLUGHVLJQOLPLWVDQG E PLQLPXP'1%5PHHWVWKHDFFHSWDEOHIXHOGHVLJQOLPLWV%DVHGRQ

WKHDERYHDQGWKH06+(/%PLWLJDWLRQDFFHSWDQFHFULWHULDLQ6HFWLRQEHLQJPHWWKH

15&VWDIIILQGVWKDWWKHGRXEOH06+(/%LQWKH7%FDQEHPLWLJDWHGXVLQJWKH36:V\\VWHP

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21















+XPDQ)DFWRUV



185(*FRQWDLQVDULVNLQIRUPHGSURFHVVIRUVFDOLQJWKHUHYLHZRIRSHUDWRUPDQXDO

DFWLRQVXVLQJTXDQWLWDWLYHRUTXDOLWDWLYHULVNLQIRUPDWLRQIRUWKHKXPDQDFWLRQV +$ 7KH

OLFHQVHH¶V/$5ZDVQRWVXEPLWWHGDVDULVNLQIRUPHG/$5WKHUHIRUHIROORZLQJWKHJXLGDQFHLQ

185(*WKH15&VWDIIXWLOL]HGDFRPELQDWLRQRIWKH³(VWLPDWHG,PSRUWDQFH0HWKRG'DQG

WKH³*HQHULF+$0HWKRG'LQ6HFWLRQWRLGHQWLI\\WKHDSSURSULDWHDPRXQWRIUHYLHZIRUWKH

RSHUDWRUDFWLRQVGHVFULEHGLQWKH/$5$/HYHO,,RU/HYHO,,,UHYLHZIRUWKHSURSRVHG7&$VZDV

GHWHUPLQHGWREHDSSURSULDWHIRUDOO7&$V7KH15&VWDIIQRWHVWKDWWKHOHYHORIGHWDLOSURYLGHG

E\\WKHOLFHQVHHZDVJHQHUDOO\\FRQVLVWHQWZLWKD/HYHO,,UHYLHZ7KLVLVFRQVLVWHQWZLWK

185(*ZKLFKVWDWHV³/LFHQVHHVPD\\FKRRVHWRXVHWKH/HYHO,,JXLGDQFHWRDGGUHVV

+)(>KXPDQIDFWRUVHQJLQHHULQJ@FRQVLGHUDWLRQVIRU+$VWKDWIDOOLQWR/HYHO,OO'7KHUHIRUHXVLQJ

WKHLQIRUPDWLRQSURYLGHGE\\WKHOLFHQVHHWKH15&VWDIISHUIRUPHGD/HYHO,,UHYLHZRIWKHQHZ

7&$VEHORZ





(YDOXDWLRQRI2SHUDWRU$FWLRQV



7KHOLFHQVHHSURYLGHGWZRDWWDFKPHQWVWRWKH/$5WKDWGLVFXVV7&$V,QLWVVXEPLWWDOGDWHG

$XJXVW$WWDFKPHQW³7LPH&ULWLFDO2SHUDWRU$FWLRQV'FRQWDLQVERWKH[LVWLQJDQG

QHZ7&$VDQG$WWDFKPHQW³)HDVLELOLW\\$VVHVVPHQWIRU1HZ3URSRVHG7LPH&ULWLFDO

2SHUDWRU$FWLRQV'GLVFXVVHVWKHQHZ7&$VIURP$WWDFKPHQW



7KHH[LVWLQJ7&$VLQ$WWDFKPHQWKDYHEHHQUHYLHZHGDQGDSSURYHGSUHYLRXVO\\E\\WKH15&

DQGGRFXPHQWHGLQ266³'HVLJQ%DVLV6SHFLILFDWLRQIRUWKH'%(V'

WKHUHIRUHWKH15&VWDIIUHYLHZHGWKHVL[QHZ7&$V





+(/%,QLWLDWHG)ORRGLQJ:LWKLQWKH7XUELQH%XLOGLQJ



7KHOLFHQVHHSRVWXODWHGDQ0)':+(/%WKDWZLWKDORVVRI$&SRZHUWRDOOWKUHHXQLWVDQGLQ

FRQMXQFWLRQZLWKIDLOXUHVWRWKH&&:SLSLQJZRXOGUHVXOWLQWKH7%IORRGLQJ7KLVZRXOGFUHDWH

DQRYHUKHDWLQJFRQGLWLRQIRUWKH5&6DQGDIIHFWDFWLYLWLHVQHFHVVDU\\IRU66'0LWLJDWLRQRI

WKHVH+(/%VLVGLYLGHGLQWRIRXUGLVWLQFWSKDVHV7KHILUVWSKDVH3KDVH³5HDFWRU6KXWGRZQ'

LVUHDFWRUVKXWGRZQDQGWKHVWDELOL]DWLRQRIWKHDIIHFWHGXQLW V LQ0RGHZLWKUHDFWRUFRRODQW

DYHUDJHWHPSHUDWXUH)



7KHOLFHQVHHSURSRVHGWZRQHZ7&$VLQ3KDVH7KHVHFRQGQHZ7&$LVGLVFXVVHGLQ6HFWLRQ

RIWKLV6(3KDVHKDVWZRSDWKZD\\VDQGWKHHPHUJHQF\\SURFHGXUHV (3V GLUHFW

RSHUDWRUVWRLQLWLDWHERWKSDWKZD\\VLQSDUDOOHO3DWKZD\\VWDWHVWKHDFWLRQVWDNHQIRU66'XVLQJ

WKH36:V\\VWHP3DWKZD\\VWDWHVWKHDFWLRQVWDNHQIRU66'XVLQJWKH66),QWKHHYHQWRI

DQ0)':+(/%LQWKH7%WKHOLFHQVHHSURSRVHGILUVWDQHZ7&$IRURSHUDWRUVWRWULSDOOIRXU

&&:SXPSVRQDOOWKUHHXQLWVZLWKLQPLQXWHV



15&6WDII(YDOXDWLRQ



7KHOLFHQVHHSURSRVHGDQHZ7&$LQ3KDVHWRSUHYHQWWKHPD[LPXPIORRGKHLJKWIURP

H[FHHGLQJWKHOLPLW7KHOLFHQVHHVWDWHGWKDWWKHUHLVDVLPLODUH[LVWLQJ7&$WRFRQWURODGHVLJQ

EDVLV7%IORRGZLWKLQPLQXWHVE\\WULSSLQJWKH&&:SXPSVDQGFORVLQJWKH&&:SXPS

GLVFKDUJHYDOYHVIURPWKH&57KHJXLGDQFHIRUWKLVH[LVWLQJDFWLRQFDQEHIRXQGLQWKH7%

IORRGDEQRUPDOSURFHGXUHV $3V IRUHDFK216XQLWDQGRSHUDWRUVUHFHLYHSHULRGLFFODVVURRP

DQGVLPXODWRUWUDLQLQJRQWKLVVFHQDULR2SHUDWRUVZLOOHQWHUWKH$3ZKHQWKHWXUELQHEDVHPHQW

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











ZDWHUHPHUJHQF\\KLJKOHYHODQQXQFLDWRULVUHFHLYHG7KLVDQQXQFLDWRULVORFDWHGLQWKH8QLW

&58QLWDQG8QLWVKDUHDFRPELQHG&5WKHUHIRUHWKHRSHUDWRUVVKRXOGLPPHGLDWHO\\

UHFRJQL]HWKDWWKHHQWU\\FRQGLWLRQVIRUWKH7%IORRG$3DUHEHLQJPHW)RU8QLWRSHUDWRUVWKH

WXUELQHEDVHPHQWZDWHUHPHUJHQF\\KLJKOHYHOFRPSXWHUDODUPZLOOEHWKHHQWU\\FRQGLWLRQ

$GGLWLRQDOO\\WKH8QLW7%IORRG$3GLUHFWVWKH8QLW&5RSHUDWRUWRQRWLI\\WKH8QLWDQG8QLW

&5RSHUDWRUVWRHQWHUWKH7%IORRG$37KHORFDWLRQRIWKHIRXU&&:SXPSFRQWUROVZLWFKHV

XVHGE\\WKHRSHUDWRUVDUHRQDQDX[LOLDU\\FRQWUROERDUGORFDWHGLPPHGLDWHO\\EHKLQGWKHPDLQ

FRQWUROERDUGDQGZLWKLQWKHPDLQ&5HQYHORSH HJQRLQWHUYHQLQJSDQHOVRUZDOOVWKDWZRXOG

LPSHGHDFFHVVWRWKHFRQWUROVZLWFKHV 7KHVXPSVZLWFKHVDUHDOVRFOHDUO\\ODEHOHG'XULQJWKH

PRVWUHFHQWUHYDOLGDWLRQRIWKHFXUUHQW7&$WKH&&:SXPSVZHUHWULSSHGLQPLQXWHV'XULQJ

LPSOHPHQWDWLRQWKHOLFHQVHHVWDWHGWKDWLWZLOOYDOLGDWHWKHSURSRVHG7&$DGGJXLGDQFHIRU

RSHUDWRUVWRVHFXUHWKH&&:SXPSVWRWKH7%+(/%PLWLJDWLRQSURFHGXUHDQGWUDLQOLFHQVHG

RSHUDWRUVYLDFODVVURRPDQGVLPXODWRUWUDLQLQJ



7KH15&VWDIIILQGVWKDWWKHSURSRVHG7&$WRWULSDOO&&:SXPSVRQDOOWKUHH216XQLWVZLWKLQ

PLQXWHVRIDQ0)':+(/%LQLWLDWHGIORRGLQJZLWKLQWKH7%WREHDFFHSWDEOHEHFDXVHLWLV

VLPLODUWRDQH[LVWLQJ7&$ZKHUHRSHUDWRUVPXVWWULSWKH&&:SXPSV,QDGGLWLRQUHFHQW

WHVWLQJRIWKHRSHUDWRUVIRUWKHH[LVWLQJ7&$SURYLGHGDGHTXDWHUHVXOWV7KHOLFHQVHHZLOO

YDOLGDWHWKHSURSRVHG7&$XSGDWHWKHSURFHGXUHDQGFRQGXFWWUDLQLQJGXULQJWKH

LPSOHPHQWDWLRQSURFHVVWKHUHE\\SURYLGLQJDGGLWLRQDODVVXUDQFHWKDWRSHUDWRUVKDYHWKH

NQRZOHGJHVNLOOVDQGDELOLWLHVWRVXFFHVVIXOO\\FRPSOHWHWKLVDFWLRQ%DVHGRQWKHDERYHWKH

15&VWDIIILQGVWKLV7&$DFFHSWDEOH





/RVVRI0DLQ)HHGZDWHUDQG(PHUJHQF\\)HHGZDWHU



&HUWDLQSRVWXODWHG0)':+(/%VLQWKH7%ZRXOGUHVXOWLQDUHDFWRUWULSVXEVHTXHQWWRWKHORVV

RI0)':WRERWK6*V%HFDXVH$&SRZHULVDOVRORVWGXULQJWKLVHYHQW():ZLOOEHORVW

UHVXOWLQJLQDORVVRIVHFRQGDU\\VLGH'+5,QRUGHUWRUHVWRUHVHFRQGDU\\VLGH'+5DQG5&3

VHDOFRROLQJWRHVWDEOLVKDQ66'FRQGLWLRQWKHOLFHQVHHKDVSURSRVHGDQRWKHUQHZ7&$LQ

3KDVH3DWKZD\\³66'8VLQJ36:6\\VWHPV'IRURSHUDWRUVWRHVWDEOLVK36:IORZWRWKH

6*VZLWKLQPLQXWHV0RUHRYHUWKH(3VZLOOGLUHFWRSHUDWRUVWRXVHWKH66) 3DWKZD\\ LQ

SDUDOOHO



15&6WDII(YDOXDWLRQ



7KHOLFHQVHHSURSRVHGWKHQHZ7&$WRUHSODFHWKHFXUUHQW7&$WKDWUHTXLUHVRSHUDWRUVWR

ORFDOO\\VWDUWWKHWXUELQHGULYHQ():SXPSDQGORFDOO\\FURVVFRQQHFW():IURPDQXQDIIHFWHG

XQLW7KHOLFHQVHHVWDWHGWKDWWKHQHZDFWLRQLVLGHQWLFDOWRDQH[LVWLQJ7&$²RSHUDWRUVPXVW

HVWDEOLVK36:IORZWRWKH6*VIROORZLQJDORVVRIVHFRQGDU\\VLGH'+57KHJXLGDQFHIRUWKH

H[LVWLQJDFWLRQLVLQWKHHPHUJHQF\\RSHUDWLQJSURFHGXUHV (23V RIHDFK216XQLWDQGWKH

RSHUDWRUVDUHSHULRGLFDOO\\HYDOXDWHGRQWKHLUDELOLW\\WRVXFFHVVIXOO\\DFFRPSOLVKWKLVDFWLRQGXULQJ

VLPXODWRUHYDOXDWLRQV'XULQJWKHPRVWUHFHQWUHYDOLGDWLRQRIWKHFXUUHQW7&$WKHOLFHQVHH

VWDWHGWKH36:IORZZDVHVWDEOLVKHGWRWKH6*VLQPLQXWHV7KHOLFHQVHHZLOOYDOLGDWHWKH

QHZ7&$LQDFFRUGDQFHZLWK2SHUDWLRQ¶V(23$3YDOLGDWLRQSURFHGXUHWRHQVXUHWKDWLWFDQEH

FRQVLVWHQWO\\DFFRPSOLVKHGZLWKPDUJLQ'XULQJLPSOHPHQWDWLRQWKHOLFHQVHHVWDWHGWKDWLWZLOO

WUDLQWKHOLFHQVHGRSHUDWRUVRQWKHUHYLVHGSURFHGXUDOJXLGDQFHYLDFODVVURRPDQGVLPXODWRU

WUDLQLQJ



7KH15&VWDIIILQGVWKHSURSRVHG7&$WRHVWDEOLVKVHFRQGDU\\VLGH'+5ZLWKWKH36:V\\VWHP

ZLWKLQPLQXWHVRIORVVRI0)':DQG():WREHDFFHSWDEOHEHFDXVHLWLVHVVHQWLDOO\\WKH

VDPHDVDQH[LVWLQJ7&$LQWKH216(23V7KHOLFHQVHHGHVFULEHGUHFHQWWHVWLQJRIWKH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











RSHUDWRUVIRUWKHH[LVWLQJ7&$ZLWKDGHTXDWHUHVXOWV'XULQJLPSOHPHQWDWLRQWKHOLFHQVHHZLOO

YDOLGDWHWKHSURSRVHG7&$DQGFRQGXFWWUDLQLQJRQWKHUHYLVHGSURFHGXUDOJXLGDQFHWKHUHE\\

SURYLGLQJDGGLWLRQDODVVXUDQFHWKDWRSHUDWRUVKDYHWKHNQRZOHGJHVNLOOVDQGDELOLWLHVQHHGHGWR

VXFFHVVIXOO\\FRPSOHWHWKLVDFWLRQ%DVHGRQWKHDERYHWKH15&VWDIIILQGVWKLV7&$

DFFHSWDEOH





/RVVRI0DLQ)HHGZDWHU



7KHOLFHQVHHSRVWXODWHGDQ0)':+(/%RFFXUULQJGRZQVWUHDPRIWKHFKHFNYDOYHLQWKH(35

RIWKH$%7KLVZLOOFDXVHWKHIROORZLQJHYHQWVWRRFFXUWKH536ZLOOWULSGXHWRKLJK5&6

SUHVVXUHWKHDIIHFWHG6*ZLOOFRPSOHWHO\\GHSUHVVXUL]HUHVXOWLQJLQDQ$),6DFWXDWLRQ$),6

DFWXDWLRQWULSVWKH0)':SXPSVDQGLVRODWHV0)':DQG():WRWKHDIIHFWHG6*DQGWKH

PRWRUGULYHQ():SXPSDOLJQHGWRWKHLQWDFW6*ZLOODXWRVWDUWRQWKHORVVRIERWK0)':

SXPSV7KHWUDQVLHQWUDSLGO\\HYROYHVLQWRDQRYHUKHDWLQJVFHQDULREHFDXVHRQHPRWRUGULYHQ

():SXPSLVVXSSO\\LQJWKHXQDIIHFWHG6*DQGDOO5&3VDUHRSHUDWLQJ



7KHOLFHQVHHVWDWHGWKDWWKHDFWLRQIRURSHUDWRUVWRVHFXUHRQH5&3SHU6*WROLPLWKHDWLQSXW

LQWRWKH5&6LVLQWKH216(23V+RZHYHUWKHOLFHQVHHSURSRVHGWRWXUQWKLVDFWLRQLQWRD

7&$WKDWPXVWEHFRPSOHWHGZLWKLQPLQXWHV



15&6WDII(YDOXDWLRQ



7KHOLFHQVHHVWDWHGWKDWIRUWKHH[LVWLQJRSHUDWRUDFWLRQWKHRSHUDWRUVFXUUHQWO\\UHFHLYHSHULRGLF

FODVVURRPDQGVLPXODWRUWUDLQLQJRQWKHPLWLJDWLRQRIRYHUKHDWLQJVFHQDULRVDQGDUHHYDOXDWHG

RQWKHLUDELOLW\\WRFRPSOHWHWKLVDFWLRQ7KHORFDWLRQRIWKH5&3FRQWUROVZLWFKHVXVHGE\\WKH

RSHUDWRUVDUHRQWKHDX[LOLDU\\FRQWUROERDUGLPPHGLDWHO\\DGMDFHQWWRWKHIURQWFRQWUROERDUGDQG

DUHFOHDUO\\ODEHOHG'XULQJLPSOHPHQWDWLRQWKHOLFHQVHHZLOOYDOLGDWHWKHQHZ7&$LQ

DFFRUGDQFHZLWK2SHUDWLRQ¶V(23$3YDOLGDWLRQSURFHGXUHWRHQVXUHWKDWWKH7&$FDQEH

DFFRPSOLVKHGFRQVLVWHQWO\\ZLWKPDUJLQDQGWRWUDLQWKHOLFHQVHGRSHUDWRUVRQWKHUHYLVHG

SURFHGXUDOJXLGDQFHYLDFODVVURRPDQGVLPXODWRUWUDLQLQJ



7KH15&VWDIIILQGVWKHSURSRVHG7&$WRVHFXUHRQH5&3SHU6*ZLWKLQPLQXWHVRIDORVVRI

0)':WREHDFFHSWDEOHEHFDXVHLWLVWKHVDPHDFWLRQWKDWRSHUDWRUVDUHFXUUHQWO\\WUDLQHGRQ

KRZHYHULWZLOOQRZEHFUHGLWHG'XULQJLPSOHPHQWDWLRQWKHOLFHQVHHZLOOYDOLGDWHWKHSURSRVHG

7&$DQGFRQGXFWWUDLQLQJRQWKHUHYLVHGSURFHGXUDOJXLGDQFHWKHUHE\\SURYLGLQJDGGLWLRQDO

DVVXUDQFHWKDWRSHUDWRUVKDYHWKHNQRZOHGJHVNLOOVDQGDELOLWLHVWRVXFFHVVIXOO\\FRPSOHWHWKLV

DFWLRQ%DVHGRQWKHDERYHWKH15&VWDIIILQGVWKLV7&$DFFHSWDEOH





0DLQWDLQLQJ5&63UHVVXUHGXULQJ/RVVRI0DLQ)HHGZDWHU



)RUWKHRYHUKHDWLQJVFHQDULRGLVFXVVHGLQ6HFWLRQRIWKLV6(DQ0)':+(/%RFFXUULQJ

GRZQVWUHDPRIWKHFKHFNYDOYHLQWKH(35RIWKH$%LWLVDVVXPHGWKDWWKH3259VDUH

XQDYDLODEOHWRSURYLGH5&6SUHVVXUHFRQWURO



7KHOLFHQVHHVWDWHGWKDWWKHFXUUHQW216(23VKDYHDQH[LVWLQJSURFHGXUDODFWLRQIRURSHUDWRUV

WRUHGXFH5&3KHDWWRWKH5&6WROLPLWKHDWLQSXWGXULQJPLWLJDWLRQRIDQRYHUKHDWLQJVFHQDULR

+RZHYHUWKHOLFHQVHHSURSRVHGDQHZ7&$WRXWLOL]HWKH5&6+39YDOYHV6SHFLILFDOO\\RQH

VHWRI5&6+39YDOYHVLVF\\FOHGDVUHTXLUHGWRPDLQWDLQDQDOWHUQDWH5&6OHWGRZQIORZSDWKWR

EHFRPSOHWHGZLWKLQPLQXWHV

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











2QFHWKHDIIHFWHGXQLWKDVUHVWRUHGDVWHDPEXEEOHLQWKHSUHVVXUL]HUDQG5&OHWGRZQKDVEHHQ

UHVWRUHGWKH5&6+39YDOYHVDUHFORVHGDQGWKHXQLWLVFRROHGGRZQWR0RGHXVLQJQRUPDO

SODQWV\\VWHPVDQGSURFHGXUHV



15&6WDII(YDOXDWLRQ



7KHOLFHQVHHVWDWHGWKDWWKHUHLVJXLGDQFHLQWKH(23VIRUHDFK216XQLWWKDWKDVWKHVDPH

DFWLRQIRURSHUDWRUVWRRSHQRQHVHWRI5&6+39YDOYHVDVDQDOWHUQDWH5&6OHWGRZQSDWK

7KLVDFWLRQLVWDNHQIRU36:PLWLJDWHGRYHUKHDWLQJHYHQWVKRZHYHULWLVQRWLQWKH(23VIRU

PLWLJDWLQJRYHUKHDWLQJHYHQWVZLWKQRUPDOSODQWV\\VWHPV. )RURYHUKHDWLQJVFHQDULRVZLWK36:

WKHOLFHQVHHVWDWHGWKDWWKHRSHUDWRUVUHFHLYHSHULRGLFFODVVURRPDQGVLPXODWRUWUDLQLQJ

VSHFLILFDOO\\RQRSHUDWLQJWKH5&6+39YDOYHVDQGRSHUDWRUVDUHHYDOXDWHGRQWKHLUDELOLW\\WR

PLWLJDWHRYHUKHDWLQJVFHQDULRVZLWK36:XVLQJWKH5&6+39YDOYHVLQVLPXODWRUHYDOXDWLRQV

7KHORFDWLRQRIWKHFRQWUROVZLWFKHVIRUWKHWZRVHWVRIYDOYHV RQHVZLWFKSHUYDOYH XVHGE\\WKH

RSHUDWRUDUHRQWKHIURQWFRQWUROERDUGDQGFOHDUO\\ODEHOHGHDFK5&6KRWOHJ $DQG% LV

HTXLSSHGZLWKWZRLQVHULHVVROHQRLGRSHUDWHG+39YDOYHVDQGERWKYDOYHVPXVWEHRSHQHGWR

HVWDEOLVKIORZ'XULQJLPSOHPHQWDWLRQWKHOLFHQVHHZLOOYDOLGDWHWKHQHZ7&$LQDFFRUGDQFH

ZLWK2SHUDWLRQ¶V(23$3YDOLGDWLRQSURFHGXUHWRHQVXUHWKDWWKH7&$FDQEHFRQVLVWHQWO\\

DFFRPSOLVKHGZLWKPDUJLQDQGWRWUDLQWKHOLFHQVHGRSHUDWRUVRQWKHUHYLVHGSURFHGXUDO

JXLGDQFHYLDFODVVURRPDQGVLPXODWRUWUDLQLQJ



7KH15&VWDIIILQGVWKHSURSRVHG7&$WRRSHQWKH5&6KLJKSRLQWYHQWVZLWKLQPLQXWHVRID

ORVVRI0)':WRPDLQWDLQ5&6SUHVVXUHEHORZWKHSUHVVXUL]HUFRGHVDIHW\\YDOYHOLIWVHWSRLQWWR

EHDFFHSWDEOHEHFDXVHLWLVHVVHQWLDOO\\WKHVDPHDFWLRQWDNHQGXULQJWKHPLWLJDWLRQRIDQ

RYHUKHDWLQJVFHQDULRXVLQJ36:'XULQJLPSOHPHQWDWLRQWKHOLFHQVHHZLOOYDOLGDWHWKH

SURSRVHG7&$DQGFRQGXFWWUDLQLQJRQWKHUHYLVHGSURFHGXUDOJXLGDQFHWKHUHE\\SURYLGLQJ

DGGLWLRQDODVVXUDQFHWKDWRSHUDWRUVKDYHWKHNQRZOHGJHVNLOOVDQGDELOLWLHVWRVXFFHVVIXOO\\

FRPSOHWHWKLVDFWLRQ%DVHGRQWKHDERYHWKH15&VWDIIILQGVWKLV7&$LVDFFHSWDEOH





,VRODWHD/HWGRZQ/LQH%UHDN+(/%:LWKLQ0LQXWHV



7KHOLFHQVHHSRVWXODWHGDQ+(/%DWWKHOHWGRZQOLQHFRQWDLQPHQWSHQHWUDWLRQLQWKH(35

XSVWUHDPRIWKHRXWVLGHFRQWDLQPHQWLVRODWLRQYDOYH7KLVZLOOFDXVHWKHIROORZLQJHYHQWVWR

RFFXUDUHDFWRUWULSZLOOEHLQLWLDWHGRQHLWKHUWKHORZ5&6SUHVVXUHRURQDYDULDEOHORZ

SUHVVXUHWULSIXQFWLRQFRQWLQXHG5&6GHSUHVVXUL]DWLRQZLOOIDOOWRWKH(6DFWXDWLRQSRLQWDQGWKH

(6V\\VWHPDFWXDWLRQZLOOLVRODWHWKHEUHDNE\\FORVLQJYDOYHV+3 $OHWGRZQFRROHURXWOHWDQG

FRQWDLQPHQWLVRODWLRQYDOYH DQG+3 %OHWGRZQFRROHURXWOHWDQGFRQWDLQPHQWLVRODWLRQYDOYH 

,IDVLQJOHDFWLYHIDLOXUHRIHLWKHU+3RU+3RFFXUV IDLOXUHWRFORVH WKHSURFHGXUDOJXLGDQFH

ZLOOGLUHFWWKHRSHUDWRUVWRFORVH+3 $OHWGRZQFRROHULQOHWLVRODWLRQYDOYH RU+3 %OHWGRZQ

FRROHULQOHWLVRODWLRQYDOYH WRLVRODWHWKHEUHDN+RZHYHUWKHEUHDNGRHVQRWLQWHUDFWZLWKDQ\\

RWKHU66'HTXLSPHQWDQGWKH+3,V\\VWHPKDVDGHTXDWHFDSDFLW\\WRFRPSHQVDWHIRUWKHOHDN

UDWHDV5&6DQGSUHVVXUL]HUOHYHOUHFRYHU5&6UHPDLQVVXEFRROHGDQGWKH5&3VUHPDLQLQ

RSHUDWLRQ



7KHOLFHQVHHKDVLGHQWLILHGWKHIROORZLQJ7&$VWKDWDUHQHHGHGWRLVRODWHWKHSULPDU\\OHDNDJH

RXWVLGHRIWKHFRQWDLQPHQWEXLOGLQJVRWKDWLWOLPLWVWKHUDGLRORJLFDOHIIOXHQWUHOHDVH



,VRODWHWKHOHWGRZQOLQHEUHDNZLWKLQPLQXWHVIROORZLQJ(6DFWXDWLRQ7KLVLVD

QHZ7&$

 6WDUWWKHFRQWUROURRPYHQWLODWLRQV\\VWHPERRVWHUIDQVZLWKLQPLQXWHVRI(6

DFWXDWLRQ7KLVLVDQH[LVWLQJ7&$

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21













15&6WDII(YDOXDWLRQ



7KHOLFHQVHHVWDWHGWKDWWKHUHLVH[LVWLQJJXLGDQFHLQWKH(6DFWXDWLRQYHULILFDWLRQHQFORVXUHRI

DOOWKH216(23VIRUWKHDFWLRQWRLVRODWHWKHOHWGRZQOLQHEUHDNZLWK+3RU+3KRZHYHULW

LVQRWD7&$7KHORFDWLRQRIWKHFRQWUROVZLWFKHVIRU+3DQGXVHGE\\WKHRSHUDWRUVWR

FRPSOHWHWKLVDFWLRQDUHRQWKHIURQWFRQWUROERDUGDGMDFHQWWRWKH+3,SXPSFRQWUROVZLWFKHV

'XULQJLPSOHPHQWDWLRQWKHOLFHQVHHZLOOYDOLGDWHWKHQHZ7&$LQDFFRUGDQFHZLWK2SHUDWLRQ¶V

(23$3YDOLGDWLRQSURFHGXUHWRHQVXUHWKDWWKH7&$FDQEHFRQVLVWHQWO\\DFFRPSOLVKHGZLWK

PDUJLQDQGWRWUDLQWKHOLFHQVHGRSHUDWRUVRQWKHUHYLVHGSURFHGXUDOJXLGDQFH6SHFLILFDOO\\WKH

H[LVWLQJSURFHGXUHVWHSVLQWKH(23VWDWHGDERYHZLOOEHUHDUUDQJHGDVQHFHVVDU\\



7KH15&VWDIIILQGVWKHSURSRVHG7&$WRLVRODWHDOHWGRZQOLQHEUHDN+(/%ZLWKLQPLQXWHV

IROORZLQJIDLOXUHRI(6DFWXDWHGYDOYHWRFORVHWREHDFFHSWDEOHEHFDXVHLWLVHVVHQWLDOO\\WKH

VDPHDVDQH[LVWLQJDFWLRQZKHUHRSHUDWRUVPXVWLVRODWHWKHOHWGRZQOLQHEUHDNZLWK+3RU

+3DQGDFWLRQIRXQGLQWKH216(23¶V(6DFWXDWLRQYHULILFDWLRQHQFORVXUH'XULQJ

LPSOHPHQWDWLRQWKHOLFHQVHHZLOOYDOLGDWHWKHSURSRVHG7&$DQGFRQGXFWWUDLQLQJRQWKHUHYLVHG

SURFHGXUDOJXLGDQFHWKHUHE\\SURYLGLQJDGGLWLRQDODVVXUDQFHWKDWRSHUDWRUVKDYHWKHNQRZOHGJH

VNLOOVDQGDELOLWLHVWRVXFFHVVIXOO\\FRPSOHWHWKLVDFWLRQ%DVHGRQWKHDERYHWKH15&VWDII

ILQGVWKLV7&$DFFHSWDEOH





,VRODWH+LJK3UHVVXUH,QMHFWLRQ3XPS'LVFKDUJH3LSLQJ%UHDN



7KHOLFHQVHHSRVWXODWHGDWHUPLQDOHQGEUHDNDWWKHGLVFKDUJHQR))OHRIWKH$RU%

+3,SXPSZKLFKFRXOGUHVXOWLQIORRGLQJWKH+3,SXPSURRPLILWLVQRWLVRODWHG7KH+3,SXPS

SURYLGHV5&6PDNHXSDQG5&3VHDOFRROLQJ7KHOLFHQVHHVWDWHGWKDWIROORZLQJDQ+(/%DW

WKHGLVFKDUJHQR))OHRIWKHRSHUDWLQJ+3,SXPSWKHLPPHGLDWHUHVSRQVHLVWKHORVVRI

GLVFKDUJHIORZDQGWKHDXWRVWDUWRIWKHVWDQGE\\+3,SXPSRQORZ5&3VHDOIORZ8SRQVWDUWRI

WKHVHFRQG+3,SXPSIORZZLOOEHUHVWRUHGWRWKH5&6DQGWKH5&3V7KH&5RSHUDWRUZLOOEH

DOHUWHGWRWKLVHYHQWEHFDXVHWKH\\ZLOOUHFHLYHWKH+3,SXPSGLVFKDUJHSUHVVXUHORZ

DQQXQFLDWRUDQGWKH5&3VHDOKHDGHUIORZORZDQQXQFLDWRU2QFHWKHEUHDNORFDWLRQKDVEHHQ

LGHQWLILHGWKHDIIHFWHG+3,SXPSZLOOEHWULSSHGE\\WKH&5RSHUDWRU$WWKHVDPHWLPHD

QRQOLFHQVHGRSHUDWRU 1/2 ZLOOORFDOO\\LVRODWHWKHOHDNE\\FORVLQJWKHUHPRWHRSHUDWHGPDQXDO

VXFWLRQYDOYHRQWKHDIIHFWHG+3,SXPS7KLVLVDQHZ7&$IRUWKH1/2WKDWPXVWEHFRPSOHWHG

ZLWKLQPLQXWHV



15&6WDII(YDOXDWLRQ



7KHOLFHQVHHVWDWHGWKDWWKHSURSRVHGDFWLRQKDVDVLPLODUH[LVWLQJ7&$7KHH[LVWLQJDFWLRQ

UHTXLUHVWKHRSHUDWRUWRWHUPLQDWHIORRGLQJLQWKH$%GXHWRDSLSHEUHDNRQDUDZVHUYLFHZDWHU

V\\VWHPZLWKLQPLQXWHV'XULQJWKHPRVWUHFHQWUHYDOLGDWLRQRIWKHFXUUHQW7&$WKHEUHDN

ZDVLVRODWHGLQPLQXWHV7KHJXLGDQFHIRUWKHH[LVWLQJ7&$FDQEHIRXQGLQWKHXQLWVSHFLILF

5&6OHDNDJH$3ZKLFKZLOO  KDYHWKHRSHUDWRUVWUHQG$%ZDVWHWDQNOHYHOVDQGFRQWDLQPHQW

VXPSOHYHOVRQWKHRSHUDWRUDLGFRPSXWHUWRDVVLVWLQWKHLGHQWLILFDWLRQRIOHDNVLQWKH$%RU

LQVLGHFRQWDLQPHQW  GLUHFWWKHRSHUDWRUVWRSHUIRUPDORVVRI+3,PDNHXSDQG5&3VHDO

LQMHFWLRQDIWHUWKHOHDNLQWKH+3,V\\VWHPLVLGHQWLILHG  LVRODWHWKH+3,V\\VWHPOHDN



/LNHWKHH[LVWLQJ7&$WKHRSHUDWRUVZLOOHQWHUWKHXQLWVSHFLILF5&6OHDNDJH$3DQGORVVRI+3,

PDNHXSDQG5&3VHDOLQMHFWLRQIROORZLQJDQ+(/%DWWKHGLVFKDUJHQR))OHRIDQRSHUDWLQJ+3,

SXPSVFHQDULR+RZHYHUVSHFLILFJXLGDQFHWRLVRODWHDQ+(/%RQWKHGLVFKDUJHQR))OHRIDQ

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

















2)),&,$/86(21/< 35235,(7$5<,1)250$7,21



+3,pump LVQRWLQWKHORVVRI+3,PDNHXSDQG5&3VHDOLQMHFWLRQSURFHGXUH The licensee SODQVWRXSGDWHWKLVGXULQJLPSOHPHQWDWLRQRIWKHSURSRVHGDPHQGPHQWV

LWKUHVSHFWWRWKHQHZ7&$WRLVRODWHWKHEUHDNWKH1/2PXVWJHWWRWKHYDOYHKDQGZKHHOV

+3+3DQG+3 ZKLFKDUHORFDWHGRQWKHGHFNLPPHGLDWHO\\DERYHWKH+3,

SXPSURRP7KHUHIRUHHQWHULQJWKH+3,SXPSURRPLVQRWUHTXLUHG7KHGHFNZKLFKLVLQDQ

HDVLO\\DFFHVVLEOHDUHDDQGWKH+3,SXPSURRPDUHORFDWHGRQWKH¶HOHYDWLRQRIWKH$%

7KH&5LVORFDWHGRQWKH¶HOHYDWLRQRIWKH$%7KHUHLVDVWDLUZHOOQHDUHDFK216&5

DFFHVVGRRUIRUWKH1/2WRJHWWRWKDWDUHD7KHOLFHQVHHVWDWHGWKDWWKHVWDLUZHOOVFRUULGRUV

DQG+3,SXPSURRPKDWFKDUHZHOOOLWDQGWKHYDOYHVDUHFOHDUO\\ODEHOHG7KHUHPRWHRSHUDWHG

PDQXDOYDOYHVDUHRSHUDWHGE\\DKDQGZKHHOFRQQHFWHGWRDUHDFKURGDQGWKHUHDUHQRVSHFLDO

WRROVRUHTXLSPHQWUHTXLUHGIRUWKH1/2WRRSHUDWHWKLVYDOYH

7KHOLFHQVHHVWDWHGWKDWFRPPXQLFDWLRQEHWZHHQWKH&5DQGWKH1/2LVQRWUHTXLUHG

+RZHYHUWKHUHLVDZDOOPRXQWHGWHOHSKRQHDYDLODEOHWKDWLVORFDWHGLQWKHSULPDU\\VLGHVDPSOH

KRRGDUHDLPPHGLDWHO\\DGMDFHQWWRWKH+3,SXPSURRPKDWFKDUHD7KH1/2VDUHDOVRJLYHQ

SRUWDEOHUDGLRV

7KHUHLVDVWDIILQJUHTXLUHPHQWRIDPLQLPXPRI1/2VWREHRQVLWHIRUDOOWKUHH216XQLWVIRU

0RGHV7KHRSHUDWLRQVPDQDJHPHQWSURFHGXUHVUHTXLUHRQHTXDOLILHG1/2UHVSRQVLEOHIRU

LPSOHPHQWLQJ$3DQG(23DFWLRQVWREHDVVLJQHGWRHDFK216XQLWWRHQVXUHWKDWUHTXLVLWH

VWDIILVDOZD\\VDYDLODEOH7KHOLFHQVHGRSHUDWRUVDQG1/2VZLOOEHWUDLQHGIRUWKHLUUHVSHFWLYH

DFWLRQVIRUWKHSRVWXODWHGHYHQWYLDFODVVURRPDQGVLPXODWRUWUDLQLQJ7KH1/2VZLOODOVRKDYH

WKLVDFWLRQDGGHGWRWKHLU7&$TXDOLILFDWLRQFDUG7RHQVXUHWKDWWKH7&$FDQEHFRQVLVWHQWO\\

DFFRPSOLVKHGZLWKLQPDUJLQWKHOLFHQVHHZLOOYDOLGDWHWKLVDFWLRQLQDFFRUGDQFHZLWK2SHUDWLRQ¶V

(23$3YDOLGDWLRQSURFHGXUH

7KH15&VWDIIILQGVWKDWWKHSURSRVHG7&$WRLVRODWH+3,SXPSGLVFKDUJHSLSLQJEUHDNE\\

FORVLQJ+3,SXPSVXFWLRQYDOYHZLWKLQPLQXWHVLVDFFHSWDEOHEHFDXVHLWLVVLPLODUWRDQ

H[LVWLQJ7&$ZKHUHRSHUDWRUVZLOOLVRODWHDQ+3,EUHDNLQRUGHUWRWHUPLQDWHIORRGLQJLQWKH$%

GXHWRDSLSHEUHDNRQDUDZVHUYLFHZDWHUV\\VWHP7KHUHFHQWWHVWLQJRIWKHRSHUDWRUVIRUWKH

H[LVWLQJ7&$SURYLGHGDGHTXDWHUHVXOWV9DOLGDWLRQRIWKHSURSRVHG7&$WUDLQLQJIRUERWK

RSHUDWRUVDQGXSGDWLQJWKHSURFHGXUHZLOOEHFRQGXFWHGGXULQJLPSOHPHQWDWLRQSURYLGLQJ

DGGLWLRQDODVVXUDQFHWKDWRSHUDWRUVKDYHWKHNQRZOHGJHVNLOOVDQGDELOLWLHVWRVXFFHVVIXOO\\

FRPSOHWHWKLVDFWLRQ7KHOLFHQVHHDOVRFRQVLGHUHGWKHSK\\VLFDOLPSHGLPHQWVIRUWKH1/2WR

FRPSOHWHWKHSURSRVHGDFWLRQDQGWKHSRWHQWLDOLVVXHVIRUFRPPXQLFDWLRQDQGVWDIILQJ%DVHG

RQWKHDERYHWKH15&VWDIIILQGVWKLV7&$DFFHSWDEOH





15&6WDII&RQFOXVLRQ



7KH15&VWDIIUHYLHZHGWKHSURSRVHG7&$VDQGILQGVWKHPWREHDFFHSWDEOHEHFDXVHWKH

DFWLRQVZHUHHLWKHULGHQWLFDORUVLPLODUWRH[LVWLQJDFWLRQVWKDWKDYHDOUHDG\\EHHQYDOLGDWHG7KH

OLFHQVHHVWDWHGIRUWKHQHZ7&$VWKDWWKHJXLGDQFHLQWKHSURFHGXUHVZLOOEHXSGDWHGDQGERWK

OLFHQVHGRSHUDWRUVDQG1/2VZLOOEHWUDLQHGDSSURSULDWHO\\'XULQJLPSOHPHQWDWLRQWKHOLFHQVHH

ZLOOYDOLGDWHWKHSURSRVHG7&$VWKHUHE\\SURYLGLQJDGGLWLRQDODVVXUDQFHWKDWRSHUDWRUVZLOOKDYH

WKHNQRZOHGJHVNLOOVDQGDELOLWLHVWRVXFFHVVIXOO\\FRPSOHWHWKHLUDFWLRQV7KHUHLVUHDVRQDEOH

DVVXUDQFHWKDWWKHRSHUDWRUVFDQVXFFHVVIXOO\\DFFRPSOLVKWKHDFWLRQVIRUWKHLUUHVSHFWLYH7&$

ZLWKLQWKHWLPHDYDLODEOHDQGWKHDFWLRQLVQRWH[SHFWHGWRFUHDWHDQ\\XQGXHEXUGHQIRUWKH

RSHUDWRUV%DVHGRQWKHDERYHWKH15&VWDIIILQGVWKHSURSRVHG7&$VDFFHSWDEOH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21













3URFHGXUH'HYHORSPHQW



7KHOLFHQVHHSURYLGHGDGLVFXVVLRQRQSURFHGXUHVDQGWKHYHULILFDWLRQDQGYDOLGDWLRQ 9 9 

SURFHVVLQ6HFWLRQ³3URFHGXUHVDQG9HULILFDWLRQ'RIWKH(QFORVXUHWRWKH/$57KH

OLFHQVHHVWDWHGWKDWDOOFKDQJHVWRWKH216(23VDQG$3VXQGHUJRWKH9 9SURFHVVJRYHUQHG

E\\RSHUDWLRQVDGPLQLVWUDWLYHSURFHGXUHVDQGWKDWWKH\\DUHYDOLGDWHGXVLQJDWDEOHWRSVHWWLQJLQ

WKHILHOGDQGRURQWKHWUDLQLQJVLPXODWRULQFOXGLQJWKH66)VLPXODWRUIRUWKH66)SURFHGXUH

7KHOLFHQVHHVWDWHGWKDWWKH9 9SURFHVVZLOOHQVXUHWKDWWKHSURFHGXUHVXVHGWRPLWLJDWHDQG

FRUUHFWDEQRUPDODQGHPHUJHQF\\FRQGLWLRQVPHHWFULWHULDLQFOXGLQJZULWWHQFRUUHFWQHVVDFFXUDWH

WHFKQLFDOFRQWHQWXVDELOLW\\DQGRSHUDWLRQDOFRUUHFWQHVV7KHOLFHQVHHVWDWHGWKDWYDOLGDWLRQZLOO

SURYLGHDVVXUDQFHWKDWWKHSURFHGXUHVFRQWDLQVXIILFLHQWDQGXQGHUVWDQGDEOHRSHUDWRU

LQIRUPDWLRQDQGDUHFRPSDWLEOHZLWKSODQWUHVSRQVHHTXLSPHQWDFFHVVLELOLW\\SODQWKDUGZDUH

VKLIWPDQSRZHUDQGHQVXUHVWKDWWKH7&$VFDQEHFRPSOHWHGZLWKLQWKHUHTXLUHGWLPH



7KHSURSRVHG7&$VKDYHEHHQUHYLHZHGE\\  WKHVHQLRUUHDFWRURSHUDWRU 652 UHVSRQVLEOH

IRUPDQDJLQJWKHRSHUDWLRQV7&$SURJUDPDQG  WKHSUHYLRXVO\\OLFHQVHG652UHVSRQVLEOHIRU

PDLQWDLQLQJWKH$3VDQG(23V7KHTXDOLWDWLYHDVVHVVPHQWLQFOXGHGWKHIROORZLQJDUHYLHZRI

WKH7&$WRWKHDSSOLFDEOHRSHUDWLQJSURFHGXUHWKHWLPHDYDLODEOHEHIRUHWKHDFWLRQLVUHTXLUHG

WKHWLPHUHTXLUHGWRFRPSOHWHWKHDFWLRQWKHUHTXLUHGVWDIILQJWKHFRPSOH[LW\\IHDVLELOLW\\RIWKH

DFWLRQWKHSODQWFRQGLWLRQDWWKHWLPHWKDWWKHDFWLRQLVUHTXLUHGDQGWKHDGHTXDF\\RIH[LVWLQJ

RSHUDWRUVNLOODQGNQRZOHGJHWRSHUIRUPWKH7&$



)ROORZLQJDSSURYDORID7&$LWZLOOEHPDQDJHGLQDFFRUGDQFHZLWKDQDGPLQLVWUDWLYHSURFHGXUH

WKDWSURYLGHVJXLGDQFHRQKRZWRLGHQWLI\\7&$VDQGFRQWUROWKHVHDFWLRQVWRHQVXUHWKDWWKH

UHTXLUHGWLPHVFDQEHPHW7&$VZLWKRXWH[FHVVPDUJLQDUHUHYDOLGDWHGDSSUR[LPDWHO\\HYHU\\

ILYH\\HDUVWRYHULI\\WKHDELOLW\\WRDFFRPSOLVKWKHDFWLRQVZLWKPDUJLQ



7KH15&VWDIIILQGVWKDWWKHSURSRVHGFKDQJHVWRWKH216SURFHGXUHVDUHDFFHSWDEOHEHFDXVH

WKHUHLVD9 9SURFHVVIRUWKHSURFHGXUHVIRUDOO216(23VDQG$SV$OOWKHSURSRVHG

FKDQJHVZLOOEHYDOLGDWHGEHFDXVHWKH\\DUH(3V7KHOLFHQVHHKDVDGHTXDWHO\\FRQVLGHUHGWKH

QHHGIRUYDOLGDWLQJSURFHGXUHVDQGWKHUHLVDQDGPLQLVWUDWLYHFRQWUROLQSODFHIROORZLQJWKH

DSSURYDORID7&$7KHUHLVUHDVRQDEOHDVVXUDQFHWKDWWKHSURSRVHGJXLGDQFHLQWKH

SURFHGXUHVZLOOEHVXIILFLHQWWRDOORZWKHRSHUDWRUVWRVXFFHVVIXOO\\FRPSOHWHWKHLUUHVSHFWLYHQHZ

7&$V%DVHGRQWKHDERYHWKH15&VWDIIILQGVWKHSURSRVHGFKDQJHVDFFHSWDEOH





7UDLQLQJ3URJUDP'HYHORSPHQW



7KHOLFHQVHHSURYLGHGDGLVFXVVLRQRIRSHUDWRUWUDLQLQJLQ6HFWLRQ³7UDLQLQJ'RIWKH

(QFORVXUHWRWKH/$57KHOLFHQVHHVWDWHGWKDWGXULQJWKHLQLWLDOOLFHQVHGRSHUDWRUWUDLQLQJ

SURJUDPRSHUDWRUVUHFHLYHFODVVURRPVLPXODWRU LQFOXGLQJ66)VLPXODWRU DQGRQWKHMRE

WUDLQLQJIRUWKH(3VDQG$3V7KHOLFHQVHHUHTXLUHVWKHRSHUDWRUVWRPDLQWDLQWKHLUSURILFLHQF\\

ZLWKWKHVHSURFHGXUHVDQGWKHLUVNLOOLQSODFLQJWKHSODQWLQDQ66'FRQGLWLRQXVLQJWKHVLPXODWRU

WKURXJKWKHFRQWLQXLQJWUDLQLQJSURJUDP7KH1/2VDOVRUHFHLYHWUDLQLQJRQWKHLU(3DQG$3

UHODWHGWDVNVGXULQJWKHLULQLWLDODQGFRQWLQXLQJWUDLQLQJSURJUDP%RWKRSHUDWRUVDQG1/2VPD\\

EHHYDOXDWHGRQ66)WLPHFULWLFDOWDVNVXVLQJMRESHUIRUPDQFHPHDVXUHVGXULQJWKHLUDQQXDO

RSHUDWLQJH[DPLQDWLRQZKLFKLVSDUWRIWKHRSHUDWRUUHTXDOLILFDWLRQSURJUDP



)RULPSOHPHQWDWLRQRIWKLV/$5WKHOLFHQVHHVWDWHGWKDWERWKOLFHQVHGRSHUDWRUVDQG1/2VZLOO

UHFHLYHFODVVURRPDQGVLPXODWRUWUDLQLQJIRUWKHSURSRVHGDFWLRQVDQGWUDLQLQJRQWKHUHYLVHG

SURFHGXUDOJXLGDQFH

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











7KH15&VWDIIILQGVWKDWWKH216WUDLQLQJSURJUDPLVDFFHSWDEOHWRVXSSRUWWKH/$5EHFDXVH

WKHOLFHQVHHZLOOSURYLGHDQDSSURSULDWHOHYHORIWUDLQLQJWKURXJKWKHFODVVURRPDQGVLPXODWRU

HQYLURQPHQWIRUERWKOLFHQVHGRSHUDWRUVDQG1/2V7KHUHLVUHDVRQDEOHDVVXUDQFHWKDWWKH

RSHUDWRUVZLOOEHDSSURSULDWHO\\WUDLQHGWRKDYHWKHNQRZOHGJHVNLOOVDQGDELOLWLHVWRVXFFHVVIXOO\\

FRPSOHWHWKHLUUHVSHFWLYHQHZ7&$V%DVHGRQWKHDERYHWKH15&VWDIIILQGVWKHSURSRVHG

FKDQJHVDFFHSWDEOH





67$7(&2168/7$7,21



,QDFFRUGDQFHZLWKWKH&RPPLVVLRQ¶VUHJXODWLRQVWKH6RXWK&DUROLQD6WDWHRIILFLDOZDVQRWLILHG

RIWKHSURSRVHGLVVXDQFHRIWKHDPHQGPHQWVRQ'HFHPEHU2Q'HFHPEHU

WKH6WDWHRIILFLDOFRQILUPHGWKDWWKH6WDWHRI6RXWK&DUROLQDKDGQRFRPPHQWV



(19,5210(17$/&216,'(5$7,21



7KHDPHQGPHQWVFKDQJHUHTXLUHPHQWVZLWKUHVSHFWWRWKHLQVWDOODWLRQRUXVHRIIDFLOLW\\

FRPSRQHQWVORFDWHGZLWKLQWKHUHVWULFWHGDUHDDVGHILQHGLQ&)53DUW7KH15&VWDIIKDV

GHWHUPLQHGWKDWWKHDPHQGPHQWVLQYROYHQRVLJQLILFDQWLQFUHDVHLQWKHDPRXQWVDQGQR

VLJQLILFDQWFKDQJHLQWKHW\\SHVRIDQ\\HIIOXHQWVWKDWPD\\EHUHOHDVHGRIIVLWHDQGWKDWWKHUHLVQR

VLJQLILFDQWLQFUHDVHLQLQGLYLGXDORUFXPXODWLYHRFFXSDWLRQDOUDGLDWLRQH[SRVXUH7KH

&RPPLVVLRQKDVSUHYLRXVO\\LVVXHGDSURSRVHGILQGLQJWKDWWKHDPHQGPHQWVLQYROYHQR

VLJQLILFDQWKD]DUGVFRQVLGHUDWLRQSXEOLVKHGLQWKHFederal Register RQ6HSWHPEHU

)5 DQGWKHUHKDVEHHQQRSXEOLFFRPPHQWRQVXFKILQGLQJ$FFRUGLQJO\\WKH

DPHQGPHQWVPHHWWKHHOLJLELOLW\\FULWHULDIRUFDWHJRULFDOH[FOXVLRQVHWIRUWKLQ&)5 F  

3XUVXDQWWR&)5 E QRHQYLURQPHQWDOLPSDFWVWDWHPHQWRUHQYLURQPHQWDODVVHVVPHQW

QHHGVEHSUHSDUHGLQFRQQHFWLRQZLWKWKHLVVXDQFHRIWKHDPHQGPHQWV





&21&/86,21



7KH&RPPLVVLRQKDVFRQFOXGHGEDVHGRQWKHFRQVLGHUDWLRQVGLVFXVVHGDERYHWKDW  WKHUH

LVUHDVRQDEOHDVVXUDQFHWKDWWKHKHDOWKDQGVDIHW\\RIWKHSXEOLFZLOOQRWEHHQGDQJHUHGE\\

RSHUDWLRQLQWKHSURSRVHGPDQQHU  WKHUHLVUHDVRQDEOHDVVXUDQFHWKDWVXFKDFWLYLWLHVZLOOEH

FRQGXFWHGLQFRPSOLDQFHZLWKWKH&RPPLVVLRQ¶VUHJXODWLRQVDQG  WKHLVVXDQFHRIWKH

DPHQGPHQWVZLOOQRWEHLQLPLFDOWRWKHFRPPRQGHIHQVHDQGVHFXULW\\RUWRWKHKHDOWKDQGVDIHW\\

RIWKHSXEOLF

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21













5()(5(1&(6

%XUFKILHOG-(G-U'XNH(QHUJ\\OHWWHUWR861XFOHDU5HJXODWRU\\&RPPLVVLRQ

3URSRVHG/LFHQVH$PHQGPHQW5HTXHVWWR5HYLVHWKH2FRQHH1XFOHDU6WDWLRQ&XUUHQW

/LFHQVLQJ%DVLVIRU+LJK(QHUJ\\/LQH%UHDNV2XWVLGHRIWKH&RQWDLQPHQW%XLOGLQJ$XJXVW

 $'$063DFNDJH$FFHVVLRQ1R0/$ 



%XUFKILHOG-(G-U'XNH(QHUJ\\OHWWHUWR861XFOHDU5HJXODWRU\\&RPPLVVLRQ

3URSRVHG/LFHQVH$PHQGPHQW5HTXHVWWR5HYLVHWKH2FRQHH1XFOHDU6WDWLRQ&XUUHQW

/LFHQVLQJ%DVLVIRU+LJK(QHUJ\\/LQH%UHDNV2XWVLGHRIWKH&RQWDLQPHQW%XLOGLQJ

5HVSRQVHVWR5HTXHVWIRU$GGLWLRQDO,QIRUPDWLRQ-XQH $'$06$FFHVVLRQ1R

0/$ 



%XUFKILHOG-(G-U'XNH(QHUJ\\OHWWHUWR861XFOHDU5HJXODWRU\\&RPPLVVLRQ

3URSRVHG/LFHQVH$PHQGPHQW5HTXHVWWR5HYLVHWKH2FRQHH1XFOHDU6WDWLRQ&XUUHQW

/LFHQVLQJ%DVLVIRU+LJK(QHUJ\\/LQH%UHDNV2XWVLGHRIWKH&RQWDLQPHQW%XLOGLQJ

5HVSRQVHVWR5HTXHVWIRU$GGLWLRQDO,QIRUPDWLRQ6HSWHPEHU $'$06$FFHVVLRQ

1R0/+ 



%DUURQ+HQU\\%'XNH(QHUJ\\OHWWHUWR861XFOHDU5HJXODWRU\\&RPPLVVLRQ

7RUQDGR+(/%0LWLJDWLRQ6WUDWHJLHVDQG5HJXODWRU\\&RPPLWPHQWV1RYHPEHU

$'$06$FFHVVLRQ1R0/ 



%D[WHU'DYH'XNH(QHUJ\\OHWWHUWR861XFOHDU5HJXODWRU\\&RPPLVVLRQ3URSRVHG

/LFHQVH$PHQGPHQW5HTXHVWWR5HYLVHWKH2FRQHH1XFOHDU6WDWLRQ&XUUHQW/LFHQVLQJ

%DVLVIRU+(/%HYHQWVRXWVLGHRIWKH&RQWDLQPHQW%XLOGLQJV/LFHQVH$PHQGPHQW5HTXHVW

1R-XQH $'$06$FFHVVLRQ1R0/ 



%D[WHU'DYH'XNH(QHUJ\\OHWWHUWR861XFOHDU5HJXODWRU\\&RPPLVVLRQ3URSRVHG

/LFHQVH$PHQGPHQW5HTXHVWWR5HYLVHWKH2FRQHH1XFOHDU6WDWLRQ&XUUHQW/LFHQVLQJ

%DVLVIRU+(/%(YHQWVRXWVLGHRIWKH&RQWDLQPHQW%XLOGLQJ8QLW/LFHQVH$PHQGPHQW

5HTXHVW1R'HFHPEHU $'$06$FFHVVLRQ1R0/ 



%D[WHU'DYH'XNH(QHUJ\\OHWWHUWR861XFOHDU5HJXODWRU\\&RPPLVVLRQ3URSRVHG

/LFHQVH$PHQGPHQW5HTXHVWWR5HYLVHWKH2FRQHH1XFOHDU6WDWLRQ&XUUHQW/LFHQVLQJ

%DVLVIRU+LJK(QHUJ\\/LQH%UHDN(YHQWV2XWVLGHRIWKH&RQWDLQPHQW%XLOGLQJ8QLW

/LFHQVH$PHQGPHQW5HTXHVW1R-XQH $'$06$FFHVVLRQ1R

0/ 



%D[WHU'DYH'XNH(QHUJ\\OHWWHUWR861XFOHDU5HJXODWRU\\&RPPLVVLRQ5HVSRQVHVWR

5HTXHVWIRU$GGLWLRQDO,QIRUPDWLRQIRUWKH/LFHQVH$PHQGPHQW5HTXHVWWR5HYLVH3RUWLRQV

RIWKH8SGDWHG)LQDO6DIHW\\$QDO\\VLV5HSRUW5HODWHGWRWKH7RUQDGR/LFHQVLQJ%DVLV

/LFHQVH$PHQGPHQW5HTXHVW6HSWHPEHU $'$06$FFHVVLRQ1R

0/ 



%D[WHU'DYH'XNH(QHUJ\\OHWWHUWR861XFOHDU5HJXODWRU\\&RPPLVVLRQ5HVSRQVHVWR

5HTXHVWIRU$GGLWLRQDO,QIRUPDWLRQIRUWKH/LFHQVH$PHQGPHQW5HTXHVWWR5HYLVHWKH

2FRQHH1XFOHDU6WDWLRQ&XUUHQW/LFHQVLQJ%DVLVIRU+LJK(QHUJ\\/LQH%UHDN(YHQWV

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











2XWVLGHRIWKH&RQWDLQPHQW%XLOGLQJ/LFHQVH$PHQGPHQW5HTXHVW1R2FWREHU

 $'$06$FFHVVLRQ1R0/1RQ3XEOLF 



%D[WHU'DYH'XNH(QHUJ\\OHWWHUWR861XFOHDU5HJXODWRU\\&RPPLVVLRQ7RUQDGR

0LWLJDWLRQ/LFHQVH$PHQGPHQW5HTXHVW5HVSRQVHWR5HTXHVWIRU$GGLWLRQDO,QIRUPDWLRQ

-XQH $'$06$FFHVVLRQ1R0/ 



%D[WHU'DYH'XNH(QHUJ\\OHWWHUWR861XFOHDU5HJXODWRU\\&RPPLVVLRQ7RUQDGR

0LWLJDWLRQ/LFHQVH$PHQGPHQW5HTXHVW5HVSRQVHWR5HTXHVWIRU$GGLWLRQDO,QIRUPDWLRQ

$XJXVW $'$06$FFHVVLRQ1R0/ 



*LOOHVSLH73UHVWRQ-U'XNH(QHUJ\\OHWWHUWR861XFOHDU5HJXODWRU\\&RPPLVVLRQ+LJK

(QHUJ\\/LQH%UHDN/LFHQVH$PHQGPHQW5HTXHVW5HVSRQVHWR5HTXHVWIRU$GGLWLRQDO

,QIRUPDWLRQ'HFHPEHU $'$06$FFHVVLRQ1R0/ 



*LOOHVSLH73UHVWRQ-U'XNH(QHUJ\\OHWWHUWR861XFOHDU5HJXODWRU\\&RPPLVVLRQ

7RUQDGRDQG+LJK(QHUJ\\/LQH%UHDN +(/% 0LWLJDWLRQ/LFHQVH$PHQGPHQW5HTXHVWV

/$5V 5HVSRQVHVWR5HTXHVWIRU$GGLWLRQDO,QIRUPDWLRQ'HFHPEHU $'$06

$FFHVVLRQ1R0/$ 



*LOOHVSLH73UHVWRQ-U'XNH(QHUJ\\OHWWHUWR861XFOHDU5HJXODWRU\\&RPPLVVLRQ

7RUQDGRDQG+LJK(QHUJ\\/LQH%UHDN +(/% 0LWLJDWLRQ/LFHQVH$PHQGPHQW5HTXHVWV

/$5V 6XSSOHPHQWDO5HVSRQVHVWR5HTXHVWIRU$GGLWLRQDO,QIRUPDWLRQ 5$, 1RV

DQG-DQXDU\\ $'$06$FFHVVLRQ1R0/$ 



*LOOHVSLH73UHVWRQ-U'XNH(QHUJ\\OHWWHUWR861XFOHDU5HJXODWRU\\&RPPLVVLRQ

7RUQDGRDQG+LJK(QHUJ\\/LQH%UHDN0LWLJDWLRQ/LFHQVH$PHQGPHQW5HTXHVWV

6XSSOHPHQWDO5HVSRQVHVWR5HTXHVWIRU$GGLWLRQDO,QIRUPDWLRQ1RVDQG

0DUFK $'$06$FFHVVLRQ1R0/$ 



0DKRQH\\0LFKDHO15&PHPRWR0LFKDHO70DUNOH\\15&2FRQHH1XFOHDU6WDWLRQ

8QLWVDQG5HJXODWRU\\$XGLWLQ6XSSRUWRI5HYLHZRI/LFHQVH$PHQGPHQW5HTXHVW

WR5HYLVHWKH/LFHQVLQJ%DVLVIRU+LJK(QHUJ\\/LQH%UHDNV2XWVLGHRIWKH&RQWDLQPHQW

%XLOGLQJ)HEUXDU\\ $'$06$FFHVVLRQ1R0/( 



0DKRQH\\0LFKDHO15&OHWWHUWR-(G%XUFKILHOG-U'XNH(QHUJ\\2FRQHH1XFOHDU

6WDWLRQ8QLWVDQG5HJXODWRU\\$XGLW5HSRUW5HJDUGLQJ/LFHQVH$PHQGPHQW

5HTXHVWWR5HYLVHWKH/LFHQVLQJ%DVLVIRU+LJK(QHUJ\\/LQH%UHDNV2XWVLGHRIWKH

&RQWDLQPHQW%XLOGLQJ1RYHPEHU $'$06$FFHVVLRQ1R0/* 



%XUFKILHOG(G--U'XNH(QHUJ\\OHWWHUWR861XFOHDU5HJXODWRU\\&RPPLVVLRQ

6XEPLWWDORI8SGDWHG)LQDO6DIHW\\$QDO\\VLV5HSRUW 8)6$5 5HYLVLRQ-XQH

$'$063DFNDJH$FFHVVLRQ1R0/$ 



*LDPEXVVR$$(&OHWWHUWR$&7KLHV'XNH3RZHU&RPSDQ\\*HQHUDO,QIRUPDWLRQ

5HTXLUHGIRU&RQVLGHUDWLRQRIWKH(IIHFWVRID3LSLQJ6\\VWHP%UHDN2XWVLGH&RQWDLQPHQW

'HFHPEHU $'$06$FFHVVLRQ1R0/% 

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











6FKZHQFHU$$(&OHWWHUWR$&7KLHV'XNH3RZHU&RPSDQ\\(UUDWD6KHHWIRU

  • HQHUDO

,QIRUPDWLRQ5HTXLUHGIRU&RQVLGHUDWLRQRIWKH(IIHFWVRID3LSLQJ6\\VWHP%UHDN2XWVLGH

&RQWDLQPHQW-DQXDU\\ $'$06$FFHVVLRQ1R0/$ 



'XNH3RZHU&RPSDQ\\0'65HSRUW1R26$QDO\\VLVRI(IIHFWV5HVXOWLQJIURP

3RVWXODWHG3LSLQJ%UHDNV2XVLGH&RQWDLQPHQWIRU2FRQHH1XFOHDU6WDWLRQ8QLWVDQG

$SULO $'$06$FFHVVLRQ1R0/$ 



'XNH3RZHU&RPSDQ\\6XSSOHPHQWWR0'65HSRUW1R26$QDO\\VLVRI(IIHFWV

5HVXOWLQJIURP3RVWXODWHG3LSLQJ%UHDNV2XWVLGH&RQWDLQPHQWIRU2FRQHH1XFOHDU6WDWLRQ

8QLWVDQG-XQH $'$06$FFHVVLRQ1R0/$ 



'XNH3RZHU&RPSDQ\\6XSSOHPHQWWR0'65HSRUW1R26$QDO\\VLVRI(IIHFWV

5HVXOWLQJIURP3RVWXODWHG3LSLQJ%UHDNV2XWVLGH&RQWDLQPHQWIRU2FRQHH1XFOHDU6WDWLRQ

8QLWVDQG0DUFK



5D\\7KRPDV''XNH(QHUJ\\OHWWHUWR861XFOHDU5HJXODWRU\\&RPPLVVLRQ5HYLVLRQWR

7RUQDGR+(/%0LWLJDWLRQ6WUDWHJLHVDQG5HJXODWRU\\&RPPLWPHQWV1RYHPEHU

$'$06$FFHVVLRQ1R0/$ 



6DQGLD1DWLRQDO/DERUDWRULHV3UHSDUHGIRU861XFOHDU5HJXODWRU\\&RPPLVVLRQ

185(*&57ZR3KDVH-HW/RDGV-DQXDU\\ $'$06$FFHVVLRQ1R

0/ 



861XFOHDU5HJXODWRU\\&RPPLVVLRQ185(*6WDQGDUG5HYLHZ3ODQ6HFWLRQ

5HYLVLRQ3ODQW'HVLJQIRU3URWHFWLRQ$JDLQVW3RVWXODWHG3LSLQJ)DLOXUHVLQ)OXLG6\\VWHPV

2XWVLGH&RQWDLQPHQW0DUFK $'$06$FFHVVLRQ1R0/ 



861XFOHDU5HJXODWRU\\&RPPLVVLRQ185(*6WDQGDUG5HYLHZ3ODQ6HFWLRQ

5HYLVLRQ(QYLURQPHQWDO4XDOLILFDWLRQRI0HFKDQLFDODQG(OHFWULFDO(TXLSPHQW0DUFK

 $'$06$FFHVVLRQ1R0/ 



861XFOHDU5HJXODWRU\\&RPPLVVLRQ185(*6WDQGDUG5HYLHZ3ODQ6HFWLRQ

5HYLVLRQ(OHFWULF3RZHU,QWURGXFWLRQ)HEUXDU\\ $'$06$FFHVVLRQ1R

0/ 



861XFOHDU5HJXODWRU\\&RPPLVVLRQ185(*6WDQGDUG5HYLHZ3ODQ6HFWLRQ

5HYLVLRQ+XPDQ)DFWRUV(QJLQHHULQJ'HFHPEHU $'$06$FFHVVLRQ1R

0/$ 



861XFOHDU5HJXODWRU\\&RPPLVVLRQ185(*6WDQGDUG5HYLHZ3ODQ6HFWLRQ

5HYLVLRQ5HDFWRU2SHUDWRU5HTXDOLILFDWLRQ3URJUDP5HDFWRU2SHUDWRU7UDLQLQJ

$XJXVW $'$06$FFHVVLRQ1R0/$ 



861XFOHDU5HJXODWRU\\&RPPLVVLRQ185(*6WDQGDUG5HYLHZ3ODQ6HFWLRQ

5HYLVLRQ1RQ/LFHQVHG3ODQW6WDII7UDLQLQJ$XJXVW $'$06$FFHVVLRQ

1R0/$ 

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











861XFOHDU5HJXODWRU\\&RPPLVVLRQ185(*6WDQGDUG5HYLHZ3ODQ6HFWLRQ

5HYLVLRQ2SHUDWLQJDQG(PHUJHQF\\2SHUDWLQJ3URFHGXUHV0DUFK

$'$06$FFHVVLRQ1R0/ 



861XFOHDU5HJXODWRU\\&RPPLVVLRQ185(*5HYLVLRQ+XPDQ)DFWRUV

(QJLQHHULQJ3URJUDP5HYLHZ0RGHO1RYHPEHU $'$06$FFHVVLRQ1R

0/$ 



861XFOHDU5HJXODWRU\\&RPPLVVLRQ185(*5HYLVLRQ*XLGDQFHIRUWKH5HYLHZ

RI&KDQJHVWR+XPDQ$FWLRQV6HSWHPEHU $'$06$FFHVVLRQ1R0/ 



861XFOHDU5HJXODWRU\\&RPPLVVLRQ185(*6WDQGDUG5HYLHZ3ODQ%UDQFK

7HFKQLFDO3RVLWLRQ5HYLVLRQ3URWHFWLRQ$JDLQVW3RVWXODWHG3LSLQJ)DLOXUHVLQ)OXLG

6\\VWHPV2XWVLGH&RQWDLQPHQW0DUFK $'$06$FFHVVLRQ1R0/ 



861XFOHDU5HJXODWRU\\&RPPLVVLRQ*HQHULF/HWWHU5HOD[DWLRQLQ$UELWUDU\\

,QWHUPHGLDWH3LSH5XSWXUH5HTXLUHPHQWVGDWHG-XQHDQG%UDQFK7HFKQLFDO

3RVLWLRQ0(%5HYLVLRQ3RVWXODWHG5XSWXUH/RFDWLRQVLQ)OXLG6\\VWHP3LSLQJ,QVLGH

DQG2XWVLGH&RQWDLQPHQW-XQH $'$06$FFHVVLRQ1R0/$ 



861XFOHDU5HJXODWRU\\&RPPLVVLRQ185(*6WDQGDUG5HYLHZ3ODQ%UDQFK

7HFKQLFDO3RVLWLRQ5HYLVLRQ3RVWXODWHG5XSWXUH/RFDWLRQVLQ)OXLG6\\VWHP3LSLQJ

,QVLGHDQG2XWVLGH&RQWDLQPHQW'HFHPEHU $'$06$FFHVVLRQ1R0/$ 



$PHULFDQ1XFOHDU6RFLHW\\$16,$16$PHULFDQ1DWLRQDO6WDQGDUG'HVLJQ

%DVLVIRU3URWHFWLRQRI/LJKW:DWHU1XFOHDU3RZHU3ODQWVDJDLQVWWKH(IIHFWVRI3RVWXODWHG

3LSH5XSWXUH'HFHPEHU



86$6WDQGDUG86$6%&RGHIRU3UHVVXUH3LSLQJ



86$6WDQGDUG86$6%1XFOHDU3RZHU3LSLQJ86$&RGHIRU3UHVVXUH3LSLQJ

'UDIW(GLWLRQ 



'XNH3RZHU&RPSDQ\\'3&1($5HYLVLRQ0DVVDQG(QHUJ\\5HOHDVHDQG

&RQWDLQPHQW5HVSRQVH0HWKRGRORJ\\6HSWHPEHU $'$06$FFHVVLRQ1R

0/ 



'XNH3RZHU&RPSDQ\\'3&1($5HYLVLRQ7KHUPDO+\\GUDXOLF7UDQVLHQW$QDO\\VLV

0HWKRGRORJ\\6HSWHPEHU $'$06$FFHVVLRQ1R0/ 



'XNH3RZHU&RPSDQ\\'3&1($5HYLVLRQ8)6$5&KDSWHU7UDQVLHQW

$QDO\\VLV0HWKRGRORJ\\0D\\ $'$06$FFHVVLRQ1R0/ 



'XNH3RZHU&RPSDQ\\'3&1(35HYLVLRQ2FRQHH1XFOHDU'HVLJQ0HWKRGRORJ\\

8VLQJ&$6026,08/$7(0D\\ $'$06$FFHVVLRQ1R0/1RQ

3XEOLF 



'XNH3RZHU&RPSDQ\\1)6$5HYLVLRQ5HORDG'HVLJQ0HWKRGRORJ\\$XJXVW

 $'$06$FFHVVLRQ1R0/$ 

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21











)UDPDWRPH7HFKQRORJLHV,QF%$:35HY$Q$GYDQFHG&RPSXWHU3URJUDPIRU

/LJKW:DWHU5HDFWRU/2&$>/RVVRI&RRODQW$FFLGHQW@DQG1RQ/2&$7UDQVLHQW$QDO\\VLV

6HSWHPEHU $'$06$FFHVVLRQ1R0/ 



$PHULFDQ1XFOHDU6RFLHW\\$16,$16$PHULFDQ1DWLRQDO6WDQGDUGIRU'HFD\\

+HDW3RZHULQ/LJKW:DWHU5HDFWRUV$XJXVW $'$06$FFHVVLRQ1R

0/1RQ3XEOLF 





3ULQFLSDO&RQWULEXWRUV

$6DOOPDQ155

65D\\155

0%UHDFK155

6-RQHV155

  • &XUUDQ155

'.L155



'DWHRI,VVXDQFH0DUFK

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21

2)),&,$/86(21/< 35235,(7$5<,1)250$7,21



-(%XUFKILHOG-U









68%-(&72&21((18&/($567$7,2181,76$1',668$1&(2)

$0(1'0(17126$1'5(5(9,6,212)/,&(16,1*%$6,6

)25+,*+(1(5*</,1(%5($.62876,'(2)&217$,10(17

(3,'///$ '$7('0$5&+





',675,%87,21

38%/,& /HWWHUDSSURYDOFKDQJHSDJHVUHGDFWHG6( 

$6DOOPDQ155

12138%/,& 6( 

5%HDWRQ155

30)LOH&RS\\

00F&RQQHOO155

5LGV1UU'RUO/SO

65D\\155

5LGV1UU/$.*ROGVWHLQ

0%UHDFK155

5LGV$&56B0DLO&75

6-RQHV155

5LGV5JQ0DLO&HQWHU

  • &XUUDQ155

5LGV155302FRQHH5HVRXUFH

'.L155

5LGV1UU'QUO1SKS5HVRXUFH

-3DULOOR155

5LGV1UU'VV6FSE5HVRXUFH

60LQ155

5LGV1UU'H[(HQE5HVRXUFH

5LGV1UU'H[(PLE5HVRXUFH

5LGV1UU'UR,ROE5HVRXUFH

5LGV1UU'UD$UFE5HVRXUFH

5LGV1UU'VV6QVE5HVRXUFH





$'$06$FFHVVLRQ1RV

3DFNDJH0/$

3URSULHWDU\\ 0/$

1RQ3URSULHWDU\\ 0/$

2)),&(

'25//3/30

'25//3/30

'25//3//$

'66616%%&

1$0(

=6WRQH

6:LOOLDPV

.*ROGVWHLQ

6.UHSHO

'$7(









2)),&(

'(;((1%%&

'(;(0,%%&

'666&3%%&

'52,2/%%&

1$0(

70DUWLQH]1DYHGR

$%XIRUG

%:LWWLFN

&&RZGUH\\

'$7(









2)),&(

'5$$5&%%&

'15/13+3%&

2*&

'25//3/%&

1$0(

.+VXHK

00LWFKHOO

-:DFKXWND

00DUNOH\\

'$7(









2)),&(

'25//3/30







1$0(

6:LOOLDPV







'$7(









2)),&,$/5(&25'&23<