Edb Cr 2/3231/2006

File Ref: EDB CR 2/3231/2006

LEGISLATIVE COUNCIL BRIEF

PUBLIC CONSULTATION ON COMPETITION POLICY

INTRODUCTION

At the meeting of the Executive Council on 3 October 2006, the Council ADVISED and the Chief Executive ORDERED that the Government should begin a three-month public consultation on the way forward for competition policy in Hong Kong, commencing in the week of 6 November A 2006. The discussion document at Annex A will form the basis of this engagement process.

JUSTIFICATIONS

CPRC Recommendations

2. In June 2005, the Competition Policy Advisory Group (COMPAG) established the Competition Policy Review Committee (CPRC) to review Hong Kong’s competition policy to ensure that it was in step with current B needs. Having reviewed the report of the CPRC, which is at Annex B, the Administration’s view is that the key recommendations therein represent a viable way forward for the further development of Hong Kong’s competition policy. In considering the way forward, we have had particular regard to the following issues.

a) The need for public consultation now

3. The issue of whether a competition law should be introduced in Hong Kong is the subject of frequent comment, both locally and internationally. Although Hong Kong’s free-market and pro-enterprise culture in itself provides a degree of safeguard for competition, we consider that there is a need to conduct public consultation on our competition policy at this juncture, for the following reasons –

(i) although our policy is to discourage anti-competitive conduct in all sectors of the economy, there are doubts about the effectiveness of such a policy. The current regulatory regime for

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competition only allows for formal investigation and sanctioning of such conduct in two sectors – broadcasting and telecommunications. In all other sectors, we are unable to determine the extent to which complaints of anti-competitive conduct might be justified. This not only results in an unsatisfactory outcome for the complainant, but can also leave a question mark against the practices of companies that have been the subject of complaints, even though these companies may not have engaged in anti-competitive conduct;

(ii) for Hong Kong to maintain our high degree of competitiveness in relation to other major cities, it is important that we show a clear commitment to high standards of market discipline, backed up where appropriate by a robust regulatory framework in all sectors of the economy;

(iii) given that our current competition policy has been in place for a number of years, and in light of experience gained in implementing competition regulation in the broadcasting and telecommunications sectors, it is now an appropriate time to review how effectively this policy is working and, in view of the recommendations of the CPRC, to consider critically whether a general competition law should be introduced in Hong Kong; and

(iv) as highlighted in the CPRC report, many benefits could result from the introduction of a cross-sector competition law in Hong Kong, (please see paragraph 4 below). b) The benefits of a new competition law

4. We accept in principle the conclusions of the CPRC that the introduction of a general competition law in Hong Kong could have the following benefits -

(i) it would allow us to implement more effectively the current competition policy by providing a legal basis for the investigation and sanctioning of anti-competitive conduct. While the guidelines issued by the Competition Policy Advisory Group (COMPAG) in 2003 set out the types of conduct that we regard as anti-competitive, there is currently no overall legal mechanism to support the effective enforcement of these guidelines. Collection of evidence, for example, is often difficult;

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(ii) it would strengthen our institutional framework for regulating competition and for its advocacy, thereby promoting market discipline in Hong Kong;

(iii) it would promote a level playing-field for business in Hong Kong by barring conduct that upsets the normal processes of competitive markets; and

(iv) without such a regulatory regime, in the long term there might be an adverse effect on our relative competitiveness, especially in sectors with high entry barriers.

5. To help ensure that any new competition law would benefit the overall business environment in Hong Kong, it should be consistent with the existing policy on competition, which is to enhance economic efficiency and free flow of trade, thereby also benefiting consumers. It should also have the aim of reinforcing business and consumer confidence and enhancing our pro-market environment, and should not impose an unnecessary regulatory burden on the community. c) Scope of competition law: cross-sector or sector specific

6. In response to the CPRC report, some interests commented that any new competition law should target only those sectors of the economy where we suspect that anti-competitive conduct is taking place. These interests argue that this would be consistent with our current sector-specific approach. Whilst agreeing that competition law should allow us to address potential problem areas, we consider that it would be both discriminatory and, in practice, logistically difficult to limit the application of the law to certain sectors. It is worth noting that, whilst competition law in Hong Kong is currently specific to the broadcasting and telecommunications sectors, our existing competition policy applies equally to all sectors. d) Types of conduct to be regulated

7. The CPRC has recommended that we should focus initially on regulating the “cartel” type of anti-competitive conduct and the abuse of market dominance, in line with the policy outlined in the guidelines promulgated by COMPAG. Although provisions regulating merger and acquisition are a common feature of competition law elsewhere in the world, the CPRC has recommended against regulating such activities in any new competition law for now. Noting that there is at present relatively little large-scale merger and acquisition activity in Hong Kong, we consider that

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from the point of view of regulatory resources, it would be more effective to concentrate initially on other areas, where the greatest problems are thought to exist.

e) The appropriate institutional framework for implementation

8. The CPRC set out three main options for an institutional model for competition regulation in Hong Kong. It noted that many overseas regulators have the power both to investigate and to sanction anti-competitive conduct, with parties having the right of appeal to the courts or to a specialist tribunal. A similar approach is also adopted under the competition provisions in local broadcasting and telecommunications laws, and would help ensure consistent decision-making and minimise the time required to conclude cases of potential anti-competitive conduct. An alternative approach would be to have the regulator investigate possible infringements, but to leave the power to adjudicate and determine sanctions to the courts or a specialist tribunal, thereby providing for a higher degree of checks and balances.

TIMETABLE FOR THE PUBLIC ENGAGEMENT EXERCISE

9. In the light of the foregoing, we will start a three-month public consultation exercise by issuing the discussion document at Annex A in the week of 6 November 2006. Depending on the outcome of this process, we would then consider the need to prepare for the introduction of a new competition law.

IMPLICATIONS OF THE PUBLIC CONSULTATION EXERCISE

10. The public consultation exercise has the financial, civil service, C economic and sustainability implications set out at Annex C.

11. The public consultation on the way forward for competition policy in Hong Kong is in conformity with the Basic Law, including the provisions concerning human rights. Legal advice will be sought to ensure that the provisions of any future legislation are consistent with the Basic Law. There are no environmental or productivity implications.

PUBLIC CONSULTATION

12. The Economic Services Panel of the Legislative Council (LegCo) discussed the CPRC report at its meeting on 19 July. There was some support for the introduction of a new, cross-sector competition law. However, reservations were also expressed, and some Members asked for justification as

- 5 - to why a cross-sector approval was preferred to one that is sector-specific. Some Members considered that we should first engage the community in an open discussion of the potential implications of such a step, and explain the way in which and a framework might operate, before seeking to introduce any new competition law.

13. To address the possible concerns of the business sector, we have explained the principles of competition law to trade associations. Whilst they are concerned about the implications of such a law, they are willing to review the likely effect of the approach eventually proposed before taking a firm position.

PUBLICITY

14. We will announce the publication of the discussion document in the week of 6 November 2006. The document will be distributed at District Offices and uploaded onto the Economic Development and Labour Bureau website. A spokesman will be available to answer press enquiries. We will also consult the Economic Services Panel of the LegCo on the discussion document.

BACKGROUND

15. Between 1993 and 1996, the Government commissioned the Consumer Council to undertake a series of studies on competition in Hong Kong. In response to the Council’s recommendations, the Government formulated policy objectives for competition and outlined an implementation framework. This included the establishment of COMPAG under the chairmanship of the Financial Secretary, which was tasked with vetting government policies and practices to ensure that they were not anti-competitive, and with reviewing other competition policy matters.

16. In May 1998 COMPAG published the statement on competition policy, which set out the objective of this policy in the following terms –

“To enhance economic efficiency and free flow of trade, thereby also benefiting consumer welfare”.

The statement was supplemented by a set of guidelines, issued in 2003, on how to maintain a competitive environment and define and tackle anti-competitive practices.

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17. In his 2005-06 Budget Speech, the Financial Secretary announced that COMPAG would appoint an independent committee to review the existing competition policy. COMPAG appointed the CPRC in June 2005, and the committee submitted its report, at Annex B, to COMPAG in June this year.

The CPRC Report

18. In the course of its review, the CPRC focused primarily on the following issues –

(a) whether there is a need for legislation to support and enhance Hong Kong’s existing competition policy; and

(b) the regulatory framework for competition and the role of COMPAG in the future regulatory regime.

a) Legislation to Support Hong Kong’s Existing Competition Policy

19. The CPRC considered that any new competition legislation should serve the policy objective of enhancing economic efficiency and the free flow of trade, thereby also benefiting consumers. The aim should not be to target or benefit specific sectors, or to stimulate competition artificially, but rather to reinforce business and consumer confidence and enhance Hong Kong’s pro-enterprise, pro-market environment.

20. Having reviewed local and overseas models, the CPRC concluded that without appropriate legislative backing it would be difficult to combat anti-competitive conduct effectively. It therefore proposed that a new competition law be introduced, and that such a law –

(i) should not seek artificially to introduce competition, but should aim to deter and sanction specific types of anti-competitive conduct;

(ii) should not seek to intervene in markets by targeting “natural” monopolies1 or mergers and acquisitions;

1 Natural monopoly arises when economies of scale provide a large cost advantage to all of an industry’s output being produced by a single firm. As “natural monopolies” in Hong Kong result from market forces rather than anti-competitive behaviour, the CPRC considers that they should not be a target of competition law.

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(iii) should be cross-sector in nature, rather than singling out certain sectors of the economy; and

(iv) should allow for exemptions to be made where so merited on public policy or economic grounds.

21. The CPRC recommended that the scope of the anti-competitive conduct to be covered by the proposed new law be based on the types of conduct set out in the COMPAG guidelines, namely –

• Price-fixing • Bid-rigging • Market allocation • Sales and production quotas • Joint boycotts • Unfair or discriminatory standards • Abuse of a dominant market position (such as predatory pricing).

22. The conduct in question would have to be shown to have had the intent or effect of distorting the normal operation of the market before it would be subject to sanction. In addition, there would be a need for detailed guidelines to explain the potential scope of the offences. b) Regulatory Framework

23. As regards the establishment of a regulatory framework for competition, the CPRC recommended that a Competition Commission be established with the power to conduct full and fair investigations of possible cases of anti-competitive conduct. The law would need to provide for sanctions that would have a clear deterrent effect, and there should be appropriate checks and balances to guard against abuse of regulatory power. The new Commission would also be expected to conduct education and publicity programmes in order to raise public awareness of the importance of fair competition to the market. The CPRC concluded that with such an authority in place, there would no longer be a need for COMPAG.

24. The CPRC recommended that the Commission should consist of a governing board and a full-time executive office. As to whether the Commission itself or the courts should be responsible for adjudicating on cases of alleged anti-competitive conduct, the CPRC put forward three options for consideration. It also took the view that sanctions should initially be limited to civil penalties.

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25. The CPRC recognised that regulating competition is complex, and that the pros and cons of the recommended approach would need to be clearly explained to the public. The CPRC therefore advised that we consult the public on the way forward before implementing any of the recommendations.

Enquiries

26. For enquiries on the brief, please contact Mr. Jonathan McKinley, Principal Assistant Secretary for Economic Development (2810 2163) or Miss Anna Chor, Assistant Secretary for Economic Development (2810 3731).

Economic Development and Labour Bureau 6 November 2006

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aZ |30 =0;:=? ,7>: 9:?0/ ?3,? 49 ;=,.?4.0 .:8;0?4?4:9 B,> 9:? , ;0=10.? >?,?0X -@? ?3,? 3GHKOKOI2PNQGTKTKPO COF 0SSGSSKOIKTS 1GOGHKTS 8,=60?> :;0=,?0 49 ,9 09A4=:9809? :1 B3,? 8423? -0 ?0=80/ KB:=6,-70 .:8;0?4?4:9LZ r9 >@.3 ,9 09A4=:9809?X .:8;0?4?4:9 /0;09/> :9 1,.?:=> >@.3 ,> 0,>0 :1 8,=60? 09?=D iur cn,-*r |s X|z}r,v,v|{ ,9/ 0C4?X ,A,47,-474?D :1 >:@=.0> :1 >@;;7D ,9/ :@?70?> 1:= /4>?=4-@?4:9X ,9/ ,..0>> ?: 491:=8,?4:9X 0C;0=?4>0 ,9/ 149,9.4,7 =0>:@=.0> I ,9/ /:0> 9:? 90.0>>,=47D /0;09/ :9 ^Z r9 , ;,;0=] ;@-74>30/ 49 ]eedX ?30 *:=7/ k,96 ,9/ ?30 x=2,94>,?4:9 1:= n.:9:84. ?30 9@8-0= :1 ;,=?4.4;,9?> 49 ?30 8,=60?Z l::;0=,?4:9 ,9/ m0A07:;809? VxnlmW /01490/ .:8;0?4?4:9 49 8,=60?Y-,>0/ 0.:9:840> ,> 1:77:B> I bZ r9 ]eecX 49 4?> =0>;:9>0_ ?: ?30 l:9>@80= l:@9.47 =0;:=?X ?30 p:A0=9809? ,.69:B70/20/ ?3,? ?30 ;=0>09.0 :1 :97D , 10B 14=8> 49 , 24A09 8,=60? /:0> 9:? 90.0>>,=47D 80,9 }c ukvwcvkqp kp yjkej hktou qt ugnngtu kpfgrgpfgpvn{ uvtkxg hqt dw{gtu| ?3,? ?30=0 4> 49,/0<@,?0 .:8;0?4?4:9Z|30 2:A0=9809? =0>;:9>0 >@220>?0/ ?3,? , rcvtqpcig kp qtfgt vq cejkgxg c rctvkewnct dwukpguu qdlgevkxg? hqt gzcorng? 8:=0 48;:=?,9? 49/4.,?:= :1 .:8;0?4?4:9 4> ?30 eqpvguvcdknkv{ :1 , 8,=60? I 49 ;,=?4.@7,=X rtqhkvu? ucngu qt octmgv ujctgA~ B30?30= ?30 -03,A4:@= :1 14=8> 49 ?30 8,=60? =0>?=4.?> 8,=60? ,..0>>X ?30=0-D 70,/492 ?: ,9 490114.409? 0.:9:84. ;0=1:=8,9.0 V49 ?0=8> :1X 1:= 0C,8;70X ,77:.,?4:9 :1 _Z |30 ;,;0= 1@=?30= 9:?0/ ?3,? .:8;0?4?4:9f K1:=.0> 14=8> ?: -0.:80 0114.409? ,9/ ?: =0>:@=.0>X ?0.39:7:24.,7 ;=:2=0>> ,9/ ?30 >?,-474?D :1 ?30 8,=60?WZ :110= , 2=0,?0= .3:4.0 :1 ;=:/@.?> ,9/ >0=A4.0> ,? 7:B0= ;=4.0>ZL |30 ;=0>09.0 :1 .:8;0?4?4:9 49 , 8,=60? 4> -09014.4,7 1:= ?30 0.:9:8D ,> , B3:70X ,> 4? .,9 307; brn+-*v{t ,ur Wr{rsv,+ 8,C484>0 0114.409.D 49 ?30 ,77:.,?4:9 :1 =0>:@=.0>X ;=:A4/0 1:= , .70,= 49/4.,?4:9 :1 8,=60? ;=010=09.0> ,9/ 8,49?,49 .:>?> ,? A4,-70 70A07> B347>? ;=:A4/492 , =,920 :1 cZ j7?3:@23 .:8;0?4?4:9 4> ,..0;?0/ ,> 3,A492 , ;:>4?4A0 48;,.? :9 8,=60?>X 4? 4> 9:? .3:4.0>Z ,7B,D> 0,>D ?: /08:9>?=,?0 ?34> 48;,.? 49 .:9.=0?0 ?0=8>Zq:B0A0=X 4? 4> ;:>>4-70 ?: .:8;,=0 ?30 =,920 ,9/ .:>? :1 ;=:/@.?> ,A,47,-70 49 , 8,=60? -01:=0 ,9/ ,1?0= , ;=:.0>> :1 K:;09492 @;L :1 ?30 8,=60? ?: .:8;0?4?4:9X ,> , ;:>>4-70 49/4.,?:= :1 ?30 0110.?> :1 093,9.0/ .:8;0?4?4:9 49 ?30 8,=60?Z

dZ x90 0C,8;70 :1 >@.3 K:;09492 @;L 4> ?30 /0=02@7,?4:9 ;=:.0>>0> 49 8,9D 0.:9:840> B34.3 3,A0 :1?09 70/ ?: 49.=0,>0/ .:8;0?4?4:9 49 ?30 >@;;7D :1 ;=:/@.?> ,9/ >0=A4.0>Z |30 =0>@7? 3,> 2090=,77D -009 >429414.,9?7D 7:B0= .:>?> ,9/ 2=0,?0= =,920> :1 ;=:/@.?> ,9/ >0=A4.0> 1:= -@>490>>0> ,9/ .:9>@80=>X ,> B077 ,> =,;4/ 499:A,?4:9 49 ?30

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t u /0A07:;809? :1 ?0.39:7:2DZj..:=/492 ?: , =0>0,=.3 =0;:=? -D ?30 k=::6492> r9>?4?@?0 r e 49 ^\\_X ;=4.0> 49 8,9D 49/@>?=40> 49.7@/492 ,4= ?=,9>;:=?X =,47 ,9/ =:,/ .,=2: ?=,9>;:=?X e|yvp1 dowrp,v.r+ 81@D5B 9,?@=,7 2,> ,9/ 7:92 /4>?,9.0 ?070;3:90 >0=A4.0>X 49 ?30 }94?0/ {?,?0> :1 j80=4., 81@D5B e r 1077 >@->?,9?4,77D 1:77:B492 /0=02@7,?4:9Zj7?3:@23 ,//4?4:9,7 .:>?> ?: ?30 .:88@94?D ]^Z r9 4?> =0>;:9>0 ?: ?30 l:9>@80= l:@9.47X ?30 p:A0=9809? /0>.=4-0/ ?30 @7?48,?0 8,D -0 49.@==0/ 49 /0A07:;492 ,9/ 8,49?,49492 ,9 0110.?4A0 =02@7,?:=D 80.3,94>8 :-50.?4A0 :1 .:8;0?4?4:9 ;:74.D ,>f K?: ;=:8:?0 0.:9:84. 0114.409.D := ?30 -0>? @>0 ?: >,102@,=/ .:8;0?4?4:9X >@.3 .:>?> .,9 -0 8:=0 ?3,9 84?42,?0/ -D ?30 :A0=,77 :1 =0>:@=.0> 1=:8 ?30 >:.40?DJ> ;0=>;0.?4A0ZL r9 >?,?492 ?34> :-50.?4A0X ?30 p:A0=9809? -09014?> ?: .:9>@80=> :1 , 1=00 ,9/ .:8;0?4?4A0 8,=60?Z 9:?0/ ?3,? ?30 .:9.0;? :1 0.:9:84. 0114.409.D .,==40/ , 9@8-0= :1 /4809>4:9>X 1:= 0C,8;70 I eZ r9 q:92 t:92X .:8;0?4?4:9 3,> ,7>: -=:@23? >@->?,9?4,7 -09014?> ?: ?30 0.:9:8DZ M r9.=0,>492 ?30 :@?;@? :-?,490/ 1=:8 , 24A09 49;@?g r9 ?30 ?070.:88@94.,?4:9> >0.?:=X /0=02@7,?4:9 3,> =0>@7?0/ 49 , >429414.,9? 1,77 49 ?070;3:90 .,77 .3,=20>X ,9/ , >@->?,9?4,7 49.=0,>0 49 ?070;3:90 .,77 A:7@80 ,9/ 14C0/ M r8;=:A492 ?30 ,77:.,?4:9 :1 =0>:@=.0> -0?B009 /4110=09? @>0>g ,>>0? 49A0>?809?Z|30=0 3,A0 ,7>: -009 3@20 2,49> 49 ?0.39:7:24.,7 499:A,?4:9 ,9/ 8,9,20809? 0114.409.DZr8;=:A0/ ?070.:88@94.,?4:9> >0=A4.0> 3,A0 ;=:8:?0/ ?30 M r8;=:A492 8,9,20=4,7 := :?30= 649/> :1 0114.409.Dg ,9/ @>0 :1 491:=8,?4:9 ?0.39:7:2D 49 , B4/0 =,920 :1 >0.?:=> 49 ?304= -4/ ?: 48;=:A0 M r8;=:A492 =0>;:9>4A090>> ?: .3,92492 /08,9/ ,9/ >@;;7D .:9/4?4:9>Z 0114.409.DX ?30=0-D ,7>: 307;492 q:92 t:92 8,49?,49 4?> 49?0=9,?4:9,7 .:8;0?4?4A090>>Z r9 ?30 -,96492 >0.?:=X ?30 ;3,>492 :@? :1 =@70> :9 -,96 49?0=0>? =,?0> 49 ^\\] .=0,?0/ ]_Z |30 =0>;:9>0 /:.@809? ,7>: 7::60/ ,? B,D> 49 B34.3 ?30 0C4>?09.0 :1 .:8;0?4?4:9 .:8;0?4?4:9 ?3,? 3,> 70/ ?: 2=0,?0= .3:4.0 1:= -@>490>>0> ,9/ .:9>@80=> B309 .:@7/ -0 ,>>0>>0/X B30?30= -D 8,=60? >?=@.?@=0X 8,=60? ;0=1:=8,9.0 := ?30 -03,A4:@= .:9>4/0=492 ?304= :;?4:9> 1:= /0;:>4?492 ?304= >,A492>Zj? ?30 >,80 ?480 4? 3,> :1 8,=60? ;,=?4.4;,9?>Zr9 /:492 >: 4? 9:?0/ ?3,?X ;=:A4/0/ ?3,? , 8,=60? B,> ,..0>>4-70 ;=:8;?0/ 499:A,?4:9 49 ?30 -,96492 >0.?:= 4?>071X -:?3 49 ?0=8> :1 ;=:/@.?> ,9/ ,9/ .:9?0>?,-70`X ?30 ;=0>09.0 :1 :90 /:849,9? ;,=?4.4;,9? := :1 :97D , >8,77 9@8-0= >0=A4.0> :110=0/ ?: .@>?:80=>X ,9/ 49 ?30 ,;;74.,?4:9 :1 ?0.39:7:2D ,9/ 8,9,20809? :1 14=8> /4/ 9:? 90.0>>,=47D 49/4.,?0 ?3,? ?30=0 B,> 49,/0<@,?0 .:8;0?4?4:9Z ;=,.?4.0>Z

e*|z|,v{t X|z}r,v,v|{ ]`Z o49,77DX ?30 2:A0=9809? =0>;:9>0 ,.69:B70/20/ ?3,? , 9@8-0= :1 :?30= ;:74.D :-50.?4A0> B0=0 74960/ ?: ?3:>0 :1 .:8;0?4?4:9 ;:74.DX 49.7@/492 ?=,/0X 49/@>?=4,7 ,9/ .:9>@80= ;=:?0.?4:9 ;:74.40>Zr? .:9.7@/0/ ?3,? B30=0 ?30=0 B0=0 .:9174.?492 :-50.?4A0>X ]\Z l:8;0?4?4:9 -09014?> -@>490>>0> ,9/ .:9>@80=> ,9/ .,9 307; 09>@=0 ?30 0114.409? ?30 149,7 5@/2809? :9 3:B ?: ;=:.00/ B:@7/ -0 8,/0 :9 ?30 -,>4> :1 B3,? B,> ,77:.,?4:9 :1 =0>:@=.0> B4?349 ?30 0.:9:8DZr9 ?30 =423? 8,=60? 09A4=:9809? I B34.3 .:9>4/0=0/ ?: -0 -0>? 1:= ?30 0.:9:8D ,> , B3:70Z /:0> 9:? 90.0>>,=47D /0;09/ :9 ?30 9@8-0= :1 ;,=?4.4;,9?> 49 ?30 8,=60? I -:?3 ?30 >@;;740=> :1 ;=:/@.?> ,9/ >0=A4.0> ,9/ ?30 ;0:;70 ,9/ ?30 14=8> B3: -@D ?30>0 ^z}yrzr{,n,v|{ |s X|z}r,v,v|{ e|yvp1 ;=:/@.?> ,9/ >0=A4.0> .,9 095:D ?30 -09014?> :1 .:8;0?4?4:9Zz0.:294>492 ?3,? .:8;0?4?4:9 4> 2::/ 1:= ?30 0.:9:8DX 1:= -@>490>> ,9/ 1:= ?30 B4/0= .:88@94?DX ]aZ q,A492 >0? :@? ?30 ;:74.D :-50.?4A0> 1:= .:8;0?4?4:9X ?30 2:A0=9809? =0>;:9>0 :@?7490/ ?30 p:A0=9809? 3,> ,/:;?0/ , ;:74.D ,480/ ,? ;=:8:?492 .:8;0?4?4:9 49 ,77 >0.?:=>Z ?30 >?0;> ?3,? B:@7/ -0 ?,609 ?: 48;70809? , .:8;=0309>4A0 ;:74.D 1:= q:92 t:92Z |30 1:77:B492 ;,=,2=,;3> :@?7490 ?30 B,D 49 B34.3 2:A0=9809? ;:74.D 3,> /0A07:;0/ |30>0 49.7@/0/ ?30 1:77:B492 I 49 =0.09? D0,=>Z M r>>@492 , .70,= ;:74.D >?,?0809? :9 ?30 :-50.?4A0> :1 ;=:8:?492 .:8;0?4?4:9 ,9/ /4>.:@=,2492 A,=4:@> 1:=8> :1 =0>?=4.?4A0 -@>490>> ;=,.?4.0>g 3GVGMPQNGOT PH 2PNQGTKTKPO >PMKEY KO 6POI9POI M z0<@4=492 ,77 2:A0=9809? -@=0,@C ?: 24A0 /@0 =02,=/ ?: ?30 .:8;0?4?4:9 ,9270 49 >0??492 90B ;:74.40> := =0A40B492 0C4>?492 ;:74.40>g ]]Z j> 9:?0/ 0,=740=X 49 ?30 84/Y]ee\>X ?30 p:A0=9809? .:884>>4:90/ ?30 l:9>@80= l:@9.47 ?: @9/0=?,60 , 9@8-0= :1 >?@/40> :9 A,=4:@> ,>;0.?> :1 .:8;0?4?4:9 49 q:92 F Up nc{ocp|u vgto? c octmgv ku oqtg eqpvguvcdng yjgp kv ku gcukgt hqt c pgy gpvtcpv vq gpvgt vjcv octmgv cpf vq eqorgvg vjgtgkp t:92X ,9/ 49 ]eec ;@-74>30/ 4?> :B9 =0>;:9>0 ?: ?30 l:@9.47J> =0.:8809/,?4:9>Z vjcp ku vjg ecug ykvj cpqvjgt octmgvA

v w /0A07:;809? :1 ?0.39:7:2DZj..:=/492 ?: , =0>0,=.3 =0;:=? -D ?30 k=::6492> r9>?4?@?0 r e 49 ^\\_X ;=4.0> 49 8,9D 49/@>?=40> 49.7@/492 ,4= ?=,9>;:=?X =,47 ,9/ =:,/ .,=2: ?=,9>;:=?X e|yvp1 dowrp,v.r+ 81@D5B 9,?@=,7 2,> ,9/ 7:92 /4>?,9.0 ?070;3:90 >0=A4.0>X 49 ?30 }94?0/ {?,?0> :1 j80=4., 81@D5B e r 1077 >@->?,9?4,77D 1:77:B492 /0=02@7,?4:9Zj7?3:@23 ,//4?4:9,7 .:>?> ?: ?30 .:88@94?D ]^Z r9 4?> =0>;:9>0 ?: ?30 l:9>@80= l:@9.47X ?30 p:A0=9809? /0>.=4-0/ ?30 @7?48,?0 8,D -0 49.@==0/ 49 /0A07:;492 ,9/ 8,49?,49492 ,9 0110.?4A0 =02@7,?:=D 80.3,94>8 :-50.?4A0 :1 .:8;0?4?4:9 ;:74.D ,>f K?: ;=:8:?0 0.:9:84. 0114.409.D := ?30 -0>? @>0 ?: >,102@,=/ .:8;0?4?4:9X >@.3 .:>?> .,9 -0 8:=0 ?3,9 84?42,?0/ -D ?30 :A0=,77 :1 =0>:@=.0> 1=:8 ?30 >:.40?DJ> ;0=>;0.?4A0ZL r9 >?,?492 ?34> :-50.?4A0X ?30 p:A0=9809? -09014?> ?: .:9>@80=> :1 , 1=00 ,9/ .:8;0?4?4A0 8,=60?Z 9:?0/ ?3,? ?30 .:9.0;? :1 0.:9:84. 0114.409.D .,==40/ , 9@8-0= :1 /4809>4:9>X 1:= 0C,8;70 I eZ r9 q:92 t:92X .:8;0?4?4:9 3,> ,7>: -=:@23? >@->?,9?4,7 -09014?> ?: ?30 0.:9:8DZ M r9.=0,>492 ?30 :@?;@? :-?,490/ 1=:8 , 24A09 49;@?g r9 ?30 ?070.:88@94.,?4:9> >0.?:=X /0=02@7,?4:9 3,> =0>@7?0/ 49 , >429414.,9? 1,77 49 ?070;3:90 .,77 .3,=20>X ,9/ , >@->?,9?4,7 49.=0,>0 49 ?070;3:90 .,77 A:7@80 ,9/ 14C0/ M r8;=:A492 ?30 ,77:.,?4:9 :1 =0>:@=.0> -0?B009 /4110=09? @>0>g ,>>0? 49A0>?809?Z|30=0 3,A0 ,7>: -009 3@20 2,49> 49 ?0.39:7:24.,7 499:A,?4:9 ,9/ 8,9,20809? 0114.409.DZr8;=:A0/ ?070.:88@94.,?4:9> >0=A4.0> 3,A0 ;=:8:?0/ ?30 M r8;=:A492 8,9,20=4,7 := :?30= 649/> :1 0114.409.Dg ,9/ @>0 :1 491:=8,?4:9 ?0.39:7:2D 49 , B4/0 =,920 :1 >0.?:=> 49 ?304= -4/ ?: 48;=:A0 M r8;=:A492 =0>;:9>4A090>> ?: .3,92492 /08,9/ ,9/ >@;;7D .:9/4?4:9>Z 0114.409.DX ?30=0-D ,7>: 307;492 q:92 t:92 8,49?,49 4?> 49?0=9,?4:9,7 .:8;0?4?4A090>>Z r9 ?30 -,96492 >0.?:=X ?30 ;3,>492 :@? :1 =@70> :9 -,96 49?0=0>? =,?0> 49 ^\\] .=0,?0/ ]_Z |30 =0>;:9>0 /:.@809? ,7>: 7::60/ ,? B,D> 49 B34.3 ?30 0C4>?09.0 :1 .:8;0?4?4:9 .:8;0?4?4:9 ?3,? 3,> 70/ ?: 2=0,?0= .3:4.0 1:= -@>490>>0> ,9/ .:9>@80=> B309 .:@7/ -0 ,>>0>>0/X B30?30= -D 8,=60? >?=@.?@=0X 8,=60? ;0=1:=8,9.0 := ?30 -03,A4:@= .:9>4/0=492 ?304= :;?4:9> 1:= /0;:>4?492 ?304= >,A492>Zj? ?30 >,80 ?480 4? 3,> :1 8,=60? ;,=?4.4;,9?>Zr9 /:492 >: 4? 9:?0/ ?3,?X ;=:A4/0/ ?3,? , 8,=60? B,> ,..0>>4-70 ;=:8;?0/ 499:A,?4:9 49 ?30 -,96492 >0.?:= 4?>071X -:?3 49 ?0=8> :1 ;=:/@.?> ,9/ ,9/ .:9?0>?,-70`X ?30 ;=0>09.0 :1 :90 /:849,9? ;,=?4.4;,9? := :1 :97D , >8,77 9@8-0= >0=A4.0> :110=0/ ?: .@>?:80=>X ,9/ 49 ?30 ,;;74.,?4:9 :1 ?0.39:7:2D ,9/ 8,9,20809? :1 14=8> /4/ 9:? 90.0>>,=47D 49/4.,?0 ?3,? ?30=0 B,> 49,/0<@,?0 .:8;0?4?4:9Z ;=,.?4.0>Z

v w M n>?,-74>3492 , 3423Y70A07 l:8;0?4?4:9 y:74.D j/A4>:=D p=:@; VlxvyjpW @9/0= ?30 ]eZ |30 {?,?0809? ,7>: ,//=0>>0/ ?30 4>>@0 :1 8,=60? /:849,9.0X ,7-04? 9:?492 ?3,? 0A09 r e .3,4=8,9>34; :1 ?30 o49,9.4,7 {0.=0?,=D ?: ?,60 , ;=:,.?4A0 =:70 49 A0??492 0C4>?492 41 , -@>490>> 3,/ , /:849,9? ;:>4?4:9 49 , 8,=60?X ?34> /4/ 9:? 90.0>>,=47D 80,9 ?3,? 81@D5B 2:A0=9809? ;:74.40> ,9/ ;=,.?4.0> ?: 09>@=0 ?3,? ?30D B0=0 9:? ,9?4Y.:8;0?4?4A0X ?30 -@>490>> B,> ,9?4Y.:8;0?4?4A0Z|30 /0?0=849492 1,.?:= B:@7/ -0 B30?30= ?30 81@D5B e r ,9/ ?: =0A40B :?30= .:8;0?4?4:9 ;:74.D 8,??0=>g ,9/ -@>490>> B,> 7484?492 8,=60? ,..0>>4-474?D ,9/ .:9?0>?,-474?DX 24A492 =4>0 ?: 0.:9:84. 490114.409.D := :->?=@.?492 1=00 ?=,/0ZnC,8;70> :1 -03,A4:@= ?3,? .:@7/ .:9>?4?@?0 M z0<@0>?492 ?30 l:9>@80= l:@9.47 ?: .:9?49@0 ?: 8:94?:= ,9/ =0A40B ?=,/0 ;=,.?4.0> ,-@>0 :1 , 8,=60? ;:>4?4:9 B0=0 <@:?0/ ,> -0492 I 49 >0.?:=> ;=:90 ?: K@91,4=L ?=,/492 ,.?4A4?40>Z M y=0/,?:=D -03,A4:@=X ;,=?4.@7,=7D 49 =07,?4:9 ?: ;=4.492g ]bZ |30 =0>;:9>0 /:.@809? 1@=?30= 9:?0/ ?3,? ?30 p:A0=9809? 3,/ =0A40B0/ ?30 M {0??492 =0?,47 ;=4.0 84948@8> 1:= ;=:/@.?> := >0=A4.0> B4?3 9: =0,/D >@->?4?@?0>g ,=2@809?> 1:= ,9/ ,2,49>? , 2090=,7 .:8;0?4?4:9 7,B 1:= q:92 t:92X ,9/ 3,/ ,9/ .:9.7@/0/ ?3,? , 9:9Y7024>7,?4A0 ,;;=:,.3 B,> 8:=0 ,;;=:;=4,?0Z M l:9/4?4:9492 ?30 >@;;7D :1 >;0.4140/ ;=:/@.?> := >0=A4.0> ?: ?30 ;@=.3,>0 :1 :?30= Z+,noyv+uzr{, |s XdbeV\ >;0.4140/ ;=:/@.?> := >0=A4.0> := ?: ?30 ,..0;?,9.0 :1 .0=?,49 =0>?=4.?4:9>Z

]cZ r9 7490 B4?3 ?30 ;=:;:>,7> >0? :@? ,-:A0X lxvyjp B,> 0>?,-74>30/ 49 m0.08-0= ]eecX j 1@770= /4>.@>>4:9 :1 ?30 .:9.0;? :1 ,-@>0 :1 , /:849,9? 8,=60? ;:>4?4:9 4> >0? :@? ,9/ ?30 p=:@; ?::6 :9 ?30 =0>;:9>4-474?D :1 4>>@492 ?30 >?,?0809? :9 .:8;0?4?4:9 49 ;,=,2=,;3> c] ,9/ c^ -07:BX ,9/ , B4/0= /4>.@>>4:9 :1 ?30 4>>@0 :1 /0149492 B3,? a ;:74.DX B34.3 B,> ;@-74>30/ 49 v,D ]eed Z|30 >?,?0809? 1@=?30= .7,=4140/ ?30 :-50.?4A0 8423? .:9>?4?@?0 ,9?4Y.:8;0?4?4A0 .:9/@.? 4> ,? ;,=,2=,;3> c` ?: ceZ :1 ?30 p:A0=9809?J> .:8;0?4?4:9 ;:74.D ,> -0492 I [-*,ur* Yr.ry|}zr{, |s X|z}r,v,v|{ e|yvp13hrp,|* h}rpvsvp V}}*|npu }vq gpjcpeg geqpqoke ghhkekgpe{ cpf htgg hnqy qh vtcfg? vjgtgd{ cnuq dgpghkvkpi eqpuwogt ygnhctgA~ ^\Z r9 4?> ]eec =0>;:9>0 ?: ?30 l:9>@80= l:@9.47X ?30 p:A0=9809? .:9.7@/0/ ?3,? ?30=0 B,> 9: .:8;077492 .,>0 1:= , 2090=,7 .:8;0?4?4:9 7,BZq:B0A0=X 49 ^\\\ ,9/ ^\\]X ]dZ r9 ?30 lxvyjp {?,?0809?X ?30 p:A0=9809? .,770/ :9 -@>490>>0> A:7@9?,=47D ?: .0,>0 7024>7,?4A0 ;=:;:>,7> B0=0 ;,>>0/ ?: >;0.414.,77D ;=:34-4? .0=?,49 ?D;0> :1 ,9?4Y.:8;0?4?4A0 := ?: =01=,49 1=:8 49?=:/@.492 =0>?=4.?4A0 ;=,.?4.0> ?3,? 48;,4= 0.:9:84. 0114.409.D := .:9/@.? ,9/ ?30 ,-@>0 :1 , /:849,9? ;:>4?4:9 49 ?30 ?070.:88@94.,?4:9>b ,9/ ?30 1=00 ?=,/0X ,//492 ?3,? 4? B:@7/ ?,60 ,/8494>?=,?4A0 := 702,7 >?0;> ?: =08:A0 >@.3 -=:,/.,>?492c 8,=60?> =0>;0.?4A07DZ ;=,.?4.0> ,> 90.0>>,=DZz0>?=4.?4A0 ;=,.?4.0> B0=0 /01490/ 49 ?30 >?,?0809? ,> ?30 1:77:B492 I ^]Z |30 09,.?809? :1 ?30>0 7,B> B,> .:9>4>?09? B4?3 ?30 p:A0=9809?J> ;:74.D :1 7024>7,?492 :9 .:8;0?4?4:9 4>>@0> :9 , >0.?:= -D >0.?:= -,>4>Zr9 ?30 >;0.414. >0.?:=> .:9.0=90/X M y=4.0Y14C492g ?30 7,B> =0170.?0/ ?30 900/ ?: 09>@=0 ?3,? 90B ,9/ 0C4>?492 74.09>00> 49 ?30 M k4/Y=422492X 8,=60? ,77:.,?4:9X >,70> ,9/ ;=:/@.?4:9 <@:?,>g ?070.:88@94.,?4:9> ,9/ -=:,/.,>?492 >0.?:=> B:@7/ -0 ,-70 ?: .:8;0?0 :9 , 70A07 ;7,D492Y1407/ 49 8,=60?> ?3,? B0=0 @9/0=2:492 , ;=:.0>> :1 /0=02@7,?4:9Zo:= :?30= M s:49? -:D.:??>g ,9/ >0.?:=> :1 ?30 0.:9:8DX lxvyjp .:9?49@0/ ?: 7::6 ,? .:8;7,49?> :1 ,9?4Y.:8;0?4?4A0 M }91,4= := /4>.=4849,?:=D >?,9/,=/>Z .:9/@.? ,9/ ?: 49A0>?42,?0 ;:>>4-70 ,-@>0> :1 /:849,9.0 ,> ?30D ,=:>0Z

j 1@770= /0>.=4;?4:9 :1 ?30>0 ?0=8>X ,> >0? :@? 49 ?30 lxvyjp {?,?0809? V,9/ 477@>?=,?0/ -D 0C,8;70>WX 4> >0? :@? 49 ;,=,2=,;3> b_ ?: c\ -07:BZ

H Upenwfkpi ugevkqpu IW cpf IX qh vjg _gngeqoowpkecvkqpu [tfkpcpeg =Ojcrvgt CBH? Xcyu qh Tqpi Wqpi> G }^vcvgogpv qp Oqorgvkvkqp \qnke{~L Oqorgvkvkqp \qnke{ Mfxkuqt{ Stqwr? Yc{ CKKJ I Upenwfkpi ugevkqpu CE cpf CF qh vjg Ntqcfecuvkpi [tfkpcpeg =Ojcrvgt GHD? kdkf>

x y M n>?,-74>3492 , 3423Y70A07 l:8;0?4?4:9 y:74.D j/A4>:=D p=:@; VlxvyjpW @9/0= ?30 ]eZ |30 {?,?0809? ,7>: ,//=0>>0/ ?30 4>>@0 :1 8,=60? /:849,9.0X ,7-04? 9:?492 ?3,? 0A09 r e .3,4=8,9>34; :1 ?30 o49,9.4,7 {0.=0?,=D ?: ?,60 , ;=:,.?4A0 =:70 49 A0??492 0C4>?492 41 , -@>490>> 3,/ , /:849,9? ;:>4?4:9 49 , 8,=60?X ?34> /4/ 9:? 90.0>>,=47D 80,9 ?3,? 81@D5B 2:A0=9809? ;:74.40> ,9/ ;=,.?4.0> ?: 09>@=0 ?3,? ?30D B0=0 9:? ,9?4Y.:8;0?4?4A0X ?30 -@>490>> B,> ,9?4Y.:8;0?4?4A0Z|30 /0?0=849492 1,.?:= B:@7/ -0 B30?30= ?30 81@D5B e r ,9/ ?: =0A40B :?30= .:8;0?4?4:9 ;:74.D 8,??0=>g ,9/ -@>490>> B,> 7484?492 8,=60? ,..0>>4-474?D ,9/ .:9?0>?,-474?DX 24A492 =4>0 ?: 0.:9:84. 490114.409.D := :->?=@.?492 1=00 ?=,/0ZnC,8;70> :1 -03,A4:@= ?3,? .:@7/ .:9>?4?@?0 M z0<@0>?492 ?30 l:9>@80= l:@9.47 ?: .:9?49@0 ?: 8:94?:= ,9/ =0A40B ?=,/0 ;=,.?4.0> ,-@>0 :1 , 8,=60? ;:>4?4:9 B0=0 <@:?0/ ,> -0492 I 49 >0.?:=> ;=:90 ?: K@91,4=L ?=,/492 ,.?4A4?40>Z M y=0/,?:=D -03,A4:@=X ;,=?4.@7,=7D 49 =07,?4:9 ?: ;=4.492g ]bZ |30 =0>;:9>0 /:.@809? 1@=?30= 9:?0/ ?3,? ?30 p:A0=9809? 3,/ =0A40B0/ ?30 M {0??492 =0?,47 ;=4.0 84948@8> 1:= ;=:/@.?> := >0=A4.0> B4?3 9: =0,/D >@->?4?@?0>g ,=2@809?> 1:= ,9/ ,2,49>? , 2090=,7 .:8;0?4?4:9 7,B 1:= q:92 t:92X ,9/ 3,/ ,9/ .:9.7@/0/ ?3,? , 9:9Y7024>7,?4A0 ,;;=:,.3 B,> 8:=0 ,;;=:;=4,?0Z M l:9/4?4:9492 ?30 >@;;7D :1 >;0.4140/ ;=:/@.?> := >0=A4.0> ?: ?30 ;@=.3,>0 :1 :?30= Z+,noyv+uzr{, |s XdbeV\ >;0.4140/ ;=:/@.?> := >0=A4.0> := ?: ?30 ,..0;?,9.0 :1 .0=?,49 =0>?=4.?4:9>Z

j 1@770= /0>.=4;?4:9 :1 ?30>0 ?0=8>X ,> >0? :@? 49 ?30 lxvyjp {?,?0809? V,9/ 477@>?=,?0/ -D 0C,8;70>WX 4> >0? :@? 49 ;,=,2=,;3> b_ ?: c\ -07:BZ

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z { ^^Z |30 ;=:A4>4:9> 49 ?30 |070.:88@94.,?4:9> ,9/ k=:,/.,>?492 x=/49,9.0> ,=0 >?477 ?30 iur crrq s|* n e|yvp1 gr.vr/ c|/ r e :97D 7,B> 2:A0=9492 .:8;0?4?4:9 49 q:92 t:92 Y ,7?3:@23 .:8;0?4?4:9 =07,?0/ 81@D5B ;=:A4>4:9> 3,A0 =0.09?7D -009 B=4??09 49?: ?30 49/4A4/@,7 .:9?=,.?> 1:= ?30 p:A0=9809? ^bZ |30 >0.?:= >;0.414. ,;;=:,.3 ?: 09,.?492 .:8;0?4?4:9 7,B 3,> >: 1,= =0>@7?0/ 49 ?30 81@D5B e r n70.?=:94. |=,/492 {0=A4.0>Z{0.?:= >;0.414. .:8;0?4?4:9 7024>7,?4:9 3,> 9:B -009 49 /0A07:;809? :1 , =02@7,?:=D 1=,80B:=6 1:= .:8;0?4?4:9 49 ?30 -=:,/.,>?492 ,9/ ;7,.0 49 q:92 t:92 1:= 8:=0 ?3,9 14A0 D0,=>X ,9/ ?34> 3,> ,77:B0/ 1:= ?30 /0A07:;809? ?070.:88@94.,?4:9> >0.?:=> ?3,? ,77:B> 1:= 1@77 49A0>?42,?4:9 ,9/X B30=0 ,;;=:;=4,?0X :1 702,7X 0.:9:84. ,9/ ,..:@9?492 0C;0=?4>0 49 ?34> ,=0,Z ?30 >,9.?4:9492 :1 ,9?4Y.:8;0?4?4A0 .:9/@.?Zq:B0A0=X 49 :?30= >0.?:=> :1 ?30 0.:9:8DX 49 ?30 ,->09.0 :1 >@;;:=?492 7024>7,?4:9X lxvyjp 3,> -009 @9,-70 ?: /0?0=8490 l|*x|s,ur X|z}r,v,v|{ e|yvp1 gr.vr/ X|zzv,,rr ?30 0C?09? ?: B34.3 .:8;7,49?> :1 ,9?4Y.:8;0?4?4A0 .:9/@.? 8423? -0 5@>?4140/Z|34> 9:? :97D =0>@7?> 49 ,9 @9>,?4>1,.?:=D :@?.:80 1:= .:8;7,49,9?>X -@? .,9 ,7>: 70,A0 , ^_Z q,A492 ?,609 9:?0 :1 ?30 .:9?49@492 49?0=0>? 49 ?30 .:88@94?D 49 ?30 4>>@0 :1 B30?30= <@0>?4:9 8,=6 ,2,49>? ?30 ;=,.?4.0> :1 .:8;,940> ?3,? 3,A0 -009 ?30 >@-50.? :1 := 9:? q:92 t:92 >3:@7/ 49?=:/@.0 , -=:,/0= .:8;0?4?4:9 7,BX 49 s@90 ^\\aX lxvyjp .:8;7,49?>X 0A09 ?3:@23 ?30>0 .:8;,940> 8,D 9:? 3,A0 092,20/ 49 ,9?4Y.:8;0?4?4A0 ,;;:49?0/ ?30 l:8;0?4?4:9 y:74.D z0A40B l:884??00 VlyzlWX B4?3 , l3,4=8,9 ,9/ .:9/@.?Z 808-0=>34; /=,B9 ,78:>? 09?4=07D 1=:8 -@>490>>X ,.,/084. ,9/ :?30= 9:9Y2:A0=9809? -,.62=:@9/>X ?: =0A40B ?30 0110.?4A090>> :1 q:92 t:92J> .:8;0?4?4:9 ;:74.D ,9/ ?: ^cZ o=:8 , -=:,/0= ;0=>;0.?4A0X 49 :=/0= 1:= q:92 t:92 ?: 8,49?,49 :@= 3423 /02=00 :1 =0;:=? ?: lxvyjp :9 4?> 149/492>Z .:8;0?4?4A090>> 49 =07,?4:9 ?: :?30= 8,5:= .4?40>X 4? 4> 48;:=?,9? ?3,? B0 >3:B , .70,= .:884?809? ?: 3423 >?,9/,=/> :1 8,=60? /4>.4;7490X -,.60/ @; B30=0 ,;;=:;=4,?0 ^`Z r9 ?30 .:@=>0 :1 4?> =0A40BX ?30 lyzl .:9/@.?0/ 0C?09>4A0 =0>0,=.3 49?: ?30 .:8;0?4?4:9 -D =:-@>? =02@7,?:=D 1=,80B:=6>Zx@= .@==09? .:8;0?4?4:9 ;:74.D 4> .:9.4>07D ,=?4.@7,?0/ ;:74.D ,9/ 7024>7,?4:9 :1 :?30= ,/8494>?=,?4:9> ,9/ 3:B ?30>0 B0=0 48;70809?0/ 49 49 ?30 lxvyjp {?,?0809? ,9/ >@->0<@09? 2@4/07490> 4>>@0/ 49 ^\\_Z w:90?3070>>X ;=,.?4.0Z|30 .:884??00 B,> ,7>: ,-70 ?: /=,B 14=>?Y3,9/ :9 ?30 69:B70/20 :1 , B4?3 ?30 0C.0;?4:9 :1 ?30 -=:,/.,>?492 ,9/ ?070.:88@94.,?4:9> 49/@>?=40>X ?30=0 4> 9@8-0= :1 0C;0=?> 1=:8 :?30= .:@9?=40>X >0A0=,7 :1 B3:8 B0=0 49A4?0/ ?: q:92 t:92 9: 702,7 1=,80B:=6 1:= ?30 48;70809?,?4:9 :1 ?30 ;:74.DZ ?: -=401 lyzl 808-0=> :9 ?304= 0C;0=409.0 49 /0,7492 B4?3 .:8;0?4?4:9 =02@7,?4:9 49 ?304= :B9 =0>;0.?4A0 0.:9:840>Z ^dZ p4A09 ?3,? :@= .@==09? .:8;0?4?4:9 ;:74.D 3,> -009 49 ;7,.0 1:= , 9@8-0= :1 D0,=>X ,9/ 49 ?30 7423? :1 0C;0=409.0 2,490/ 49 ?30 ;=:.0>> :1 7024>7,?492 ?: =02@7,?0 .:8;0?4?4:9 ^aZ |30 lyzl .:8;70?0/ 4?> =0A40B ,9/ /074A0=0/ 4?> 149/492> ,9/ =0.:8809/,?4:9> 49 49 ?30 -=:,/.,>?492 ,9/ ?070.:88@94.,?4:9> >0.?:=>X B0 -0740A0 ?3,? ?34> B:@7/ -0 s@90 ^\\bZ |30>0 B0=0 ;@-74>30/ 49 , =0;:=?d ?3,? B,> 8,/0 ;@-74. 49 s@7D ^\\bZ ,9 ,;;=:;=4,?0 5@9.?@=0 ,? B34.3 ?: =0A40B ?30 0110.?4A090>> :1 ?30 ;:74.D ,9/X 49 |30 149/492> :1 ?30 lyzl 1:=8 ?30 -,>4> 1:= ?30 4>>@0>X :;?4:9> ,9/ 60D <@0>?4:9> A40B :1 ?30 lyzlJ> .70,= =0.:8809/,?4:9>X ?: .:9>4/0= .=4?4.,77D B30?30= , 2090=,7 ?3,? ,=0 >0? :@? 49 l3,;?0=> _ ?: b :1 ?34> /4>.@>>4:9 /:.@809?Z .:8;0?4?4:9 7,B >3:@7/ -0 49?=:/@.0/ 49 q:92 t:92Z

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/W *4?3:@? >@.3 , =02@7,?:=D =02480X 49 ?30 7:92 ?0=8 ?30=0 8423? -0 ,9 ,/A0=>0 __Z j >@88,=D :1 ?30 8,49 ,=0,> .:A0=0/ -D ?30 7,B> 49 ?30 5@=4>/4.?4:9> 809?4:90/ 0110.? :9 :@= =07,?4A0 .:8;0?4?4A090>>X 0>;0.4,77D 49 >0.?:=> B4?3 3423 09?=D ,-:A0 4> >3:B9 49 |,-70 ] -07:BZ|30 ?,-70 49/4.,?0> ?3,? .:8;0?4?4:9 7,B> 49 :?30= -,==40=>Z 5@=4>/4.?4:9> 3,A0 8,9D .:88:9 2090=,7 070809?>Zq:B0A0=X ?30=0 4> 9: >49270 K8,49>?=0,8L := K>0? 1:=8@7,L ,;;=:,.3 ?: ?30 /0?,470/ ;=:A4>4:9> :1 ?30 =070A,9? _\Z r8;:=?,9?7DX ?: 307; 09>@=0 ?3,? ,9D 90B .:8;0?4?4:9 7,B B:@7/ -09014? ?30 :A0=,77 7024>7,?4:9Zz,?30=X ?30 ,.?@,7 702,7 ,9/ =02@7,?:=D 1=,80B:=6> ,/:;?0/ 49 /4110=09? -@>490>> 09A4=:9809? 49 q:92 t:92X 4? >3:@7/ -0 .:9>4>?09? B4?3 ?30 0C4>?492 ;:74.D 5@=4>/4.?4:9> =0170.? ?304= >;0.414. .3,=,.?0=4>?4.>X >@.3 ,> ?30 >4E0 :1 ?30 0.:9:8DX :9 .:8;0?4?4:9X B34.3 4> ?: 093,9.0 0.:9:84. 0114.409.D ,9/ 1=00 17:B :1 ?=,/0X 8,=60? >?=@.?@=0 ,9/ ;:74?4.,7 ,9/ 34>?:=4.,7 .:9?0C?Z ?30=0-D ,7>: -09014?492 .:9>@80=>Zr? >3:@7/ ,7>: 3,A0 ?30 ,48 :1 =0491:=.492 -@>490>> ,9/ .:9>@80= .:914/09.0 ,9/ 093,9.492 :@= ;=:Y8,=60? 09A4=:9809?X ,9/ >3:@7/ 9:? 48;:>0 ,9 @990.0>>,=D =02@7,?:=D -@=/09 :9 ?30 .:88@94?DZ

_]Z |30 1:77:B492 .3,;?0=X 7,=207D /=,B9 1=:8 ?30 lyzl =0;:=?X :@?7490> ?30 8,49 10,?@=0> :1 .:8;0?4?4:9 =02@7,?4:9 49 , 9@8-0= :1 8,5:= 0.:9:840> ?3,? ,=0 1,8474,= ?: q:92 t:92X -D A4=?@0 :1 -0492 B077 0>?,-74>30/ ?=,/492 ;,=?90=>X ,9/ 49 >:80 .,>0> 3,A492 702,7 >D>?08> >4847,= ?: q:92 t:92J>Z

sr ss ^eZ *0 9:?0 ?3,? ,7?3:@23 q:92 t:92J> 1=00Y8,=60? ,9/ ;=:Y09?0=;=4>0 .@7?@=0 49 4?>071 L`Ygj]h C e ;=:A4/0> , 1,4= /02=00 :1 >,102@,=/ 1:= .:8;0?4?4:9X .:8;0?4?4:9 7,B :1 , 2090=,7 Lfdg]jajafe U]_kcYjafe ae V]c][j]\ 9,?@=0 3,> ,7=0,/D -009 48;70809?0/ 49 8:>? ,/A,9.0/ :A0=>0,> 0.:9:840>Z *0 QYbfh M[fefda]i 81@D5B r ,7>: ,..0;? ?3,? ?30 49?=:/@.?4:9 :1 , .=:>>Y>0.?:=X ,> :;;:>0/ ?: >0.?:= >;0.414.X .:8;0?4?4:9 7,B 49 q:92 t:92 .:@7/ 3,A0 ?30 1:77:B492 -09014?> I r _^Z p4A09 ?3,? :A0= d\ 0.:9:840> B:=7/B4/0 3,A0 .:8;0?4?4:9 7,B> 49 ;7,.0X ?30=0 ,=0 81@D5B ,Wr? B:@7/ ,77:B @> ?: 48;70809? ?30 .@==09? .:8;0?4?4:9 ;:74.D 8:=0 0110.?4A07D ;709?D :1 0C,8;70> ?: .3::>0 1=:8 B309 >006492 ?: @9/0=>?,9/ 3:B .:8;0?4?4:9 f -D ;=:A4/492 , 702,7 -,>4> 1:= ?30 49A0>?42,?4:9 ,9/ >,9.?4:9492 :1 ,9?4Y.:8;0?4?4A0 =02@7,?4:9 B:=6>Z|34> l3,;?0= 24A0> , -=401 :A0=A40B :1 ?30 .:8;0?4?4:9 7,B ,9/ .:9/@.?Z *3470 ?30 2@4/07490> 4>>@0/ -D ?30 lxvyjp 49 ^\\_ >0? :@? ?30 ?D;0> =02@7,?:=D 1=,80B:=6 49 j@>?=,74,Xl,9,/,X ?30 n@=:;0,9 }94:9 Vn}WX {492,;:=0X ?30 :1 .:9/@.? ?3,? B0 =02,=/ ,> ,9?4Y.:8;0?4?4A0X ?30=0 4> .@==09?7D 9: :A0=,77 702,7 }94?0/ t492/:8 V}tW ,9/ ?30 }94?0/ {?,?0> :1 j80=4., V}{jWZ r9 ;,=?4.@7,= 4? 7::6> 80.3,94>8 ?: >@;;:=? ?30 0110.?4A0 091:=.0809? :1 ?30>0 2@4/07490>Zl:770.?4:9 ,? I :1 0A4/09.0X 1:= 0C,8;70X 4> :1?09 /4114.@7?g M |30 >.:;0 :1 ?30 =070A,9? 7,B>g -Wr? B:@7/ >?=092?309 :@= 49>?4?@?4:9,7 1=,80B:=6 1:= =02@7,?492 .:8;0?4?4:9 ,9/ M |30 ?D;0> :1 -03,A4:@= ?3,? ,=0 ;=:34-4?0/ -D ?30 7,B>g ,9/ 1:= 4?> ,/A:.,.DX ?30=0-D ;=:8:?492 8,=60? /4>.4;7490 49 q:92 t:92g M x?30= 48;:=?,9? ;=:A4>4:9>X >@.3 ,> 0C08;?4:9>Z .Wr? B:@7/ 48;=:A0 ?30 -@>490>> 09A4=:9809? ,9/ ;=:8:?0 , 70A07 ;7,D492Y1407/ 1:= -@>490>> 49 q:92 t:92 -D -,==492 .:9/@.? ?3,? @;>0?> ?30 9:=8,7 ;=:.0>>0> :1 .:8;0?4?4A0 8,=60?>g ,9/ 4XCNQMGS PH @GIUMCTPRY >RPVKSKPOS KO =TJGR 4EPOPNKGS

sr ss BCDMG ,. ;CKO 0RGCS 2PVGRGF DY 2PNQGTKTKPO :CWS _`Z j7?3:@23 ?30 A,=4:@> 0.:9:840> 74>?0/ ,-:A0 3,A0 >3,;0/ ?304= 7,B> ?: >@4? ?304= :B9 ;,=?4.@7,= ;:74?4.,7X 0.:9:84. ,9/ 702,7 >4?@,?4:9>X ?30=0 ,=0 10,?@=0> ?3,? ,;;0,= ?: -0 .:88:97D ,..0;?0/ ,> 49/4>;09>,-70 ?: ,9 0110.?4A0 .:8;0?4?4:9 7,B I pECDB1<91 r1>141 tEB?@51> -9>71@?B5 />9D54 /-p />9?> z9>74?= M j9 49/4.,?4:9 :1 ?30 -=:,/ >.:;0 :1 ?30 .:9/@.? ?3,? 4> .:9>4/0=0/ ?: -0 ,9?4Y

{1G |=,/0 y=,.?4.0> ]eda nl |=0,?DX l:8;0?4?4:9 j.? l:8;0?4?4:9 j.? {30=8,9 j.?X .:8;0?4?4A0g r f 81@D5B j.? ]ec` l:8;0?4?4:9 j.? j=?4.70> d],9/ d^ ^\\` ]eedX n9?0=;=4>0 l7,D?:9 j.? ,9/ j.? ^\\^ q,=?Y{.:??Y M j /0>.=4;?4:9 :1 ?30 >;0.414. ?D;0> :1 .:9/@.? ?3,? ,=0 ?: -0 ;=:34-4?0/ @9/0= ?30 81@D5B z:/49: j9?4Y?=@>? f r r8;=:A0809?> 7,Bg ,9/ j.? M y=:A4>4:9 ?: -0 8,/0 1:= 0C08;?4:9> 1=:8 ?30 7,B 49 .,>0> B30=0 ;@-74. 49?0=0>? -3?@5 z0>?=4.?4A0 z0>?=4.?4A0 z0>?=4.?4A0 z0>?=4.?4A0 z0>?=4.?4A0 v:9:;:740>X := 0.:9:84. 2=:@9/> ,=0 ;,=,8:@9?Z ,2=00809?>X ,2=00809?>X ,2=00809?> ,2=00809?>X ,2=00809?>X @9=0,>:9,-70 ,-@>0 :1 ,-@>0 :1 Vj=?4.70 d]WX ,-@>0 ,-@>0 :1 ,-@>0 :1 =0>?=,49? :1 ?=,/0 /:849,9.0X ,9?4Y /:849,9.0X ,9?4Y :1 /:849,9? /:849,9.0 ,9/ /:849,9.0 ,9/ ,9/ ,9?4Y _aZ r9 .:9>4/0=492 ?30 B,D 1:=B,=/ 1:= q:92 t:92J> .:8;0?4?4:9 ;:74.DX 4? 4> 48;:=?,9? .:8;0?4?4A0 .:8;0?4?4A0 8,=60? ;:>4?4:9 ,9?4Y.:8;0?4?4A0 ,9?4Y.:8;0?4?4A0 .:8;0?4?4A0 80=20=> ,9/ 80=20=> ,9/ Vj=?4.70 d^Wg 80=20=> ,9/ 80=20=> ,9/ 80=20=> ,9/ ?3,? ?30 ,.?@,7 >4?@,?4:9 :1 q:92 t:92 >3:@7/ -0 ?,609 49?: ,..:@9?Z|34> ,.<@4>4?4:9>X ,.<@4>4?4:9> ,9/ >0;,=,?0 80=20= ,.<@4>4?4:9> ,.<@4>4?4:9> ,.<@4>4?4:9> 9:?B4?3>?,9/492X ?30 0C;0=409.0 :1 :?30= 5@=4>/4.?4:9> ;=:A4/0> @>01@7 ;:49?0=>Zo:= @91,4= ?=,/0 @91,4= ?=,/0 ;=:A4>4:9> ;=,.?4.0> ;=,.?4.0> 0C,8;70X 49 8,9D 5@=4>/4.?4:9>X ?30 =02@7,?4:9 :1 80=20=> ,9/ ,.<@4>4?4:9> ,9/ ?30 -=0,6492 @; :1 8:9:;:740> ,=0 ;=4:=4?D 4>>@0> 1:= ?30 =02@7,?:=D ,@?3:=4?40>Zr? 900/> .I@5C ?6 y=4.0Y14C492X >,70> y=4.0Y14C492X j2=00809?> ,9/ y=4.0Y14C492X y=4.0Y14C492X -4/Y v:9:;:74>492 := ?: -0 .:9>4/0=0/ B30?30= >@.3 ,9 ,;;=:,.3 B:@7/ -0 >@4?,-70 1:= q:92 t:92J> 3?>4E3D ,9/ ;=:/@.?4:9 ;=0/,?:=D ;=4.492X ;=,.?4.0> ?3,? ;=0/,?:=D =422492X =0>,70 ,??08;?492 ?: 3?F5B54 <@:?,>X 5:49? 8,=60? ,77:.,?4:9X 3,A0 ?30 :-50.? -03,A4:@=X ;=4.0 =0>?=4.?4:9X 8:9:;:74>0X >4?@,?4:9X := B30?30= B0 >3:@7/ -0 8:=0 .:9.0=90/ B4?3 :?30= ,>;0.?> :1 .:8;0?4?4:9 -:D.:??>X ;=4.0 2=:@; -:D.:??>X := 0110.? :1 8,=60? 8,=60? >3,=492X 80=20=> ,9/ =02@7,?4:9Z /4>.=4849,?4:9X -4/Y=422492X >,70> =0>?=4.?492 := ,77:.,?4:9X >,70> 7484?492 := ,.<@4>4?4:9>X ;=4.0Y 0C.7@>4A0 /0,7492X ,9/ ;=:/@.?4:9 /4>?:=?492 ,9/ ;=:/@.?4:9 .:9?=:77492 14C492X -4/Y=422492 =0>,70 ;=4.0 <@:?,> .:8;0?4?4:9 <@:?,>X :@?;@?X _bZ o@=?30=8:=0X B309 ,>>0>>492 ,9 ,;;=:;=4,?0 =0>;:9>0 ?: .:9/4?4:9> 49 q:92 t:92X 8,49?09,9.0 ,;;74.,?4:9 :1 ,;;74.,?4:9 :1 /4>.=4849,?:=D /4>.=4849,?:=D 4? 4> 48;:=?,9? ?3,? B0 ,.69:B70/20 ?3,? ?30=0 8,D -0 /4A0=209? A40B> 49 ?30 7:.,7 .:9/4?4:9> .:9/4?4:9> .:88@94?D ,> ?: ?30 8:>? ,;;=:;=4,?0 B,D :1 09>@=492 ?3,? :@= 8,=60?> =08,49 .:8;0?4?4A0Z ~D85B j809/809?> n9>@=492 >8,77 nC08;?4:9> 8,D nC08;?4:9> 8,D nC08;?4:9> 8,D {.:;0 :1 ?30 7,B @B?F9C9?>C 49?=:/@.0/ 49 ,9/ 80/4@8Y -0 2=,9?0/ :9 ,9 -0 2=,9?0/ :9 -0 2=,9?0/ :9 ?09/> ?: -0 =0.09? D0,=> ?: >4E0/ 09?0=;=4>0> 49/4A4/@,7 -,>4> := ;@-74. ;:74.D := ;@-74. ;:74.D := /01490/ -D ?30 ;=:?0.? >8,77 3,A0 K,9 -D -7:.6 0.:9:84. 0.:9:84. 49?0=;=0?,?4:9> :1 -@>490>>0> 0<@4?,-70 0C08;?4:9 -D ?30 2=:@9/> 2=:@9/> ?30 .:@=?>g ?30 ,2,49>? 7,=20= :;;:=?@94?D ?: n@=:;0,9 7,B ;=:A4/0> 1:= ;7,D0=>g ;,=?4.4;,?0 49 ?30 l:884>>4:9 0C08;?4:9> 49 0C08;?4:9> 8,D 0.:9:8DL 4> :90 >;0.414. -0 2=,9?0/ :9 :1 ?30 7,BU> 8,49 .4=.@8>?,9.0> ;@-74. ;:74.D := ;@=;:>0>g .0=?,49 0.:9:84. ;@-74. 49?0=0>? := 2=:@9/> 0.:9:84. 2=:@9/> .:@7/ -0 @>0/ ,> , /0109.0

st sup BCDMG ,. ;CKO 0RGCS 2PVGRGF DY 2PNQGTKTKPO :CWS _`Z j7?3:@23 ?30 A,=4:@> 0.:9:840> 74>?0/ ,-:A0 3,A0 >3,;0/ ?304= 7,B> ?: >@4? ?304= :B9 ;,=?4.@7,= ;:74?4.,7X 0.:9:84. ,9/ 702,7 >4?@,?4:9>X ?30=0 ,=0 10,?@=0> ?3,? ,;;0,= ?: -0 .:88:97D ,..0;?0/ ,> 49/4>;09>,-70 ?: ,9 0110.?4A0 .:8;0?4?4:9 7,B I pECDB1<91 r1>141 tEB?@51> -9>71@?B5 />9D54 /-p />9?> z9>74?= M j9 49/4.,?4:9 :1 ?30 -=:,/ >.:;0 :1 ?30 .:9/@.? ?3,? 4> .:9>4/0=0/ ?: -0 ,9?4Y

st sup L`Ygj]h D `\Z |30 49?0=9,?4:9,7 .:88@94?D =0.:294>0> q:92 t:92J> 1=00 ,9/ 1,A:@=,-70 -@>490>> QYaejYaeae_ Y Lfdg]jajal] Melahfed]ejI 09A4=:9809?Zr9 , ;00= =0A40B :1 q:92 t:92 .:9/@.?0/ 49 ^\\aX jynl =08,=60/ Lfeia\]hYjafei ^fh Nfe_ Pfe_ ?3,? q:92 t:92J> 8,=60? :=409?0/ ,9/ >0.?:= >;0.414. ,;;=:,.3 ?: .:8;0?4?4:9 3,/ [email protected] 80=4?X B347>? 9:?492 ?3,? ?30=0 B,> , 900/ 1:= .:9>?,9? >@=A0477,9.0 ,9/ 0A,7@,?4:9 :1 ?30 >4?@,?4:9Z 7OTRPFUETKPO + 6POI9POI[S 4EPOPNKE 4OVKRPONGOT `]Z w:90?3070>>X >:80 49?0=9,?4:9,7 :=2,94>,?4:9> 3,A0 0C;=0>>0/ .:9.0=9 ?3,? ?30=0 4> _cZ q:92 t:92 4> , 1=00 ,9/ :;09 0.:9:8DX B4?3 10B =0>?=,49?> ?: ?=,/0 49 2::/> ,9/ 74??70 =02@7,?4:9 :1 ,9?4Y.:8;0?4?4A0 .:9/@.? 49 q:92 t:92Z|30 *:=7/ |=,/0 >0=A4.0> ,9/ 1:=0429 /4=0.? 49A0>?809? VomrWX ,9/ 9: >429414.,9? 09?=D -,==40=> ?: 8:>? x=2,94>,?4:9 V*|xW {0.=0?,=4,?J> =0;:=? :9 ?30 ^\\^ |=,/0 y:74.D z0A40B :9 q:92 r g 49/@>?=40>Zr9 .:88:9 B4?3 8,9D :?30= /0A07:;0/ 0.:9:840>X , 3423 ;=:;:=?4:9 t:92 0C;=0>>0/ ?30 :;494:9 ?3,? K?30 >008492 7,.6 :1 .:30=09? 80,>@=0> ?: ,//=0>> 81@D5B V>:80 edSW :1 7:.,7 =024>?0=0/ -@>490>>0> ,=0 {8,77 ,9/ v0/4@8Y>4E0/ n9?0=;=4>0> ,9?4Y.:8;0?4?4A0 ;=,.?4.0> 49 ,77 -@? , 10B >0.?:=> .:@7/ .:9>?4?@?0 ,9 :->?,.70 ?: 81@D5B g r V{vn>WZ l:8;,940> ,=0 1=00 ?: .:8;0?0 49 ?0=8> :1 ;=4.0X 49.7@/492 ?30 @>0 :1 /4>.:@9? 2=0,?0= .:8;0?4?4:9L I ,7?3:@23 ?34> A40B B,> 7,?0= -,7,9.0/ -D , .:8809? 1=:8 ,9/ 7:D,7?D >.3080>X ,9/ 49 ?0=8> :1 /4110=09?4,?0/ 2::/> ,9/ >0=A4.0>Z ?30 l3,4= :1 ?30 *|x |=,/0 y:74.D z0A40B ?: ?30 0110.? ?3,? 4? 2090=,77D ,;;=0.4,?0/ q:92 t:92J> 011:=?> ?: 8,49?,49 , .:8;0?4?4A0 8,=60?Zn,=740= ?34> D0,=X ?30 r9?0=9,?4:9,7 _dZ {:80 >0.?:=> .3,=,.?0=4>0/ -D >429414.,9? 0.:9:840> :1 >.,70 ,=0 /:849,?0/ -D , 10B v:90?,=D o@9/ B07.:80/ ?30 0>?,-74>3809? :1 ?30 lyzl ?: =0A40B .:8;0?4?4:9 ;:74.D -42 .:8;,940>X B4?3 := B4?3:@? , 7,=20 9@8-0= :1 >8,770= .:8;,940> ,? ?30 ;0=4;30=DZ 49 q:92 t:92 ,9/ ?30 ;:>>4-70 =:70 :1 , 2090=,7 .:8;0?4?4:9 7,BZ |30>0 >0.?:=> @>@,77D 49A:7A0 7,=20 14C0/ ,>>0? 49A0>?809? B4?3 7:92 ;,D-,.6 ;0=4:/>Z |30 /:849,?4:9 :1 .0=?,49 >0.?:=> -D , >8,77 9@8-0= :1 .:8;,940> 4> 9:? ,9?4Y `^Z |30 =0;:=? :1 ?30 lyzl 34237423?0/ ?30 >;0.414. .3,=,.?0=4>?4.> :1 q:92 t:92J> 0.:9:8DX .:8;0?4?4A0 ;0= >0Zr9 .0=?,49 >0.?:=>X ?34> 4> >48;7D , =0>@7? :1 8,=60? 1:=.0>Z ,9/ .:9.7@/0/ ?3,? .:8;0?4?4:9 4> -0>? 9@=?@=0/ ,9/ >@>?,490/ -D ,77:B492 ?30 1=00 w:90?3070>>X 49 >:80 >0.?:=> >@.3 /:849,?4:9 4> .:8-490/ B4?3 :?30= 1,.?:=>X B4?3 ;7,D :1 8,=60? 1:=.0>Zr? 1@=?30= .:8809?0/ ?3,? ,9D 90B ,;;=:,.3 ?: .:8;0?4?4:9 ?30 =0>@7? ?3,? ?30 ;:>>4-474?D :1 ,9?4Y.:8;0?4?4A0 -03,A4:@= 0C4>?>Z|30>0 1,.?:=> ;:74.DX 49.7@/492 7024>7,?4:9 >3:@7/ >0=A0 ?30 ;@=;:>0 :1 093,9.492 0.:9:84. 0114.409.D 49.7@/0 3423 8,=60? 09?=D -,==40=>X ;=4.0 4907,>?4. /08,9/X 7484?0/ ;=:/@.? /4110=09?4,?4:9 ,9/ ?30 1=00 17:B :1 ?=,/0X ?30=0-D ,7>: -09014?492 .:9>@80= B071,=0Z|30 ,48 >3:@7/ B4?3 .:8;0?4?4:9 8,497D :9 ;=4.0X ;=0/4.?,-70 /08,9/ ,9/ 8,=60? >3,=0X ,9/ A0=?4.,7 9:? -0 ?: -09014? := ?: ?,=20? >;0.414. >0.?:=>X 9:= ?: >?48@7,?0 := 49?=:/@.0 .:8;0?4?4:9 49?02=,?4:9Zw:90?3070>>X 0A09 ?3:@23 ?30 8,=60? >?=@.?@=0 8423? 3,A0 070809?> ,=?414.4,77DZz,?30=X ?30 60D :-50.?4A0> >3:@7/ -0 ?: =0491:=.0 -@>490>> ,9/ .:9>@80= ?3,? .:@7/ ,77:B 1:= ,9?4Y.:8;0?4?4A0 .:9/@.?X 4? /:0> 9:? 90.0>>,=47D 1:77:B ?3,? >@.3 .:914/09.0X 093,9.0 q:92 t:92J> ;=:Y09?0=;=4>0X ;=:Y8,=60? 09A4=:9809? ,9/ ?: .:9/@.? 4> ;=0>09?Z ;=:A4/0 , 70A07 ;7,D492Y1407/ 1:= ,77 -D .:8-,?492 ,9?4Y.:8;0?4?4A0 -03,A4:@=Z

_eZ q:92 t:92 3,> , A4-=,9? 8,=60? 49 8,9D 2::/> ,9/ >0=A4.0>Z *4?3 093,9.0/ ;@-74. 0/@.,?4:9 :9 .:9>@80= ;=:?0.?4:9 ,9/ 30423?090/ ,B,=090>> 49 ?30 .:88@94?DX ?30 /0A07:;0/ , 6009 >09>0 :1 .:9>@80= =423?>Zr9 =0.09? D0,=>X ?30=0 3,> -009 49.=0,>492 /08,9/ 1:= 2=0,?0= .:9>@80= ;=:?0.?4:9 ,9/ 8:=0 .:8;0?4?4:9 49 >0.?:=> >@.3 ,> ?=,9>;:=? ,9/ @?474?40>X B30=0 ?30=0 ,=0 ;0=.04A0/ ?: -0 7484?0/ 68? 7>8<=9;: ,5 :;;:=?@94?40> 1:= 90B 8,=60? 09?=,9?>Z|30=0 3,A0 ,7>: -009 ,7702,?4:9> :1 , 7,.6 s?5C w?>7 z?>7 >554 1 >5G 3?=@5D9D9?> <1Go :1 .:8;0?4?4:9 := :1 ,9?4Y.:8;0?4?4A0 -03,A4:@= 49 >:80 >0.?:=>Zk@9/7492 :1 >0=A4.0> ,.=:>> >0.?:=> 3,> ,7>: =,4>0/ .:9.0=9>Z `_Z r9 >0??492 :@? 4?> ;7,9> ?: 48;70809? ?30 .:8;0?4?4:9 ;:74.D 08-:/40/ 49 ?30 lxvyjp {?,?0809? :1 v,D ]eedX ?30 p:A0=9809? .,770/ @;:9 ,77 -@>490>>0>f K?: .0,>0 0C4>?492X ,9/ =01=,49 1=:8 49?=:/@.492X =0>?=4.?4A0 ;=,.?4.0> ?3,? 48;,4= 0.:9:84. 0114.409.D := 1=00 ?=,/0 :9 , A:7@9?,=D -,>4>ZL |30 lxvyjp {?,?0809? .:9?49@0/f

sv sw L`Ygj]h D `\Z |30 49?0=9,?4:9,7 .:88@94?D =0.:294>0> q:92 t:92J> 1=00 ,9/ 1,A:@=,-70 -@>490>> QYaejYaeae_ Y Lfdg]jajal] Melahfed]ejI 09A4=:9809?Zr9 , ;00= =0A40B :1 q:92 t:92 .:9/@.?0/ 49 ^\\aX jynl =08,=60/ Lfeia\]hYjafei ^fh Nfe_ Pfe_ ?3,? q:92 t:92J> 8,=60? :=409?0/ ,9/ >0.?:= >;0.414. ,;;=:,.3 ?: .:8;0?4?4:9 3,/ [email protected] 80=4?X B347>? 9:?492 ?3,? ?30=0 B,> , 900/ 1:= .:9>?,9? >@=A0477,9.0 ,9/ 0A,7@,?4:9 :1 ?30 >4?@,?4:9Z 7OTRPFUETKPO + 6POI9POI[S 4EPOPNKE 4OVKRPONGOT `]Z w:90?3070>>X >:80 49?0=9,?4:9,7 :=2,94>,?4:9> 3,A0 0C;=0>>0/ .:9.0=9 ?3,? ?30=0 4> _cZ q:92 t:92 4> , 1=00 ,9/ :;09 0.:9:8DX B4?3 10B =0>?=,49?> ?: ?=,/0 49 2::/> ,9/ 74??70 =02@7,?4:9 :1 ,9?4Y.:8;0?4?4A0 .:9/@.? 49 q:92 t:92Z|30 *:=7/ |=,/0 >0=A4.0> ,9/ 1:=0429 /4=0.? 49A0>?809? VomrWX ,9/ 9: >429414.,9? 09?=D -,==40=> ?: 8:>? x=2,94>,?4:9 V*|xW {0.=0?,=4,?J> =0;:=? :9 ?30 ^\\^ |=,/0 y:74.D z0A40B :9 q:92 r g 49/@>?=40>Zr9 .:88:9 B4?3 8,9D :?30= /0A07:;0/ 0.:9:840>X , 3423 ;=:;:=?4:9 t:92 0C;=0>>0/ ?30 :;494:9 ?3,? K?30 >008492 7,.6 :1 .:30=09? 80,>@=0> ?: ,//=0>> 81@D5B V>:80 edSW :1 7:.,7 =024>?0=0/ -@>490>>0> ,=0 {8,77 ,9/ v0/4@8Y>4E0/ n9?0=;=4>0> ,9?4Y.:8;0?4?4A0 ;=,.?4.0> 49 ,77 -@? , 10B >0.?:=> .:@7/ .:9>?4?@?0 ,9 :->?,.70 ?: 81@D5B g r V{vn>WZ l:8;,940> ,=0 1=00 ?: .:8;0?0 49 ?0=8> :1 ;=4.0X 49.7@/492 ?30 @>0 :1 /4>.:@9? 2=0,?0= .:8;0?4?4:9L I ,7?3:@23 ?34> A40B B,> 7,?0= -,7,9.0/ -D , .:8809? 1=:8 ,9/ 7:D,7?D >.3080>X ,9/ 49 ?0=8> :1 /4110=09?4,?0/ 2::/> ,9/ >0=A4.0>Z ?30 l3,4= :1 ?30 *|x |=,/0 y:74.D z0A40B ?: ?30 0110.? ?3,? 4? 2090=,77D ,;;=0.4,?0/ q:92 t:92J> 011:=?> ?: 8,49?,49 , .:8;0?4?4A0 8,=60?Zn,=740= ?34> D0,=X ?30 r9?0=9,?4:9,7 _dZ {:80 >0.?:=> .3,=,.?0=4>0/ -D >429414.,9? 0.:9:840> :1 >.,70 ,=0 /:849,?0/ -D , 10B v:90?,=D o@9/ B07.:80/ ?30 0>?,-74>3809? :1 ?30 lyzl ?: =0A40B .:8;0?4?4:9 ;:74.D -42 .:8;,940>X B4?3 := B4?3:@? , 7,=20 9@8-0= :1 >8,770= .:8;,940> ,? ?30 ;0=4;30=DZ 49 q:92 t:92 ,9/ ?30 ;:>>4-70 =:70 :1 , 2090=,7 .:8;0?4?4:9 7,BZ |30>0 >0.?:=> @>@,77D 49A:7A0 7,=20 14C0/ ,>>0? 49A0>?809? B4?3 7:92 ;,D-,.6 ;0=4:/>Z |30 /:849,?4:9 :1 .0=?,49 >0.?:=> -D , >8,77 9@8-0= :1 .:8;,940> 4> 9:? ,9?4Y `^Z |30 =0;:=? :1 ?30 lyzl 34237423?0/ ?30 >;0.414. .3,=,.?0=4>?4.> :1 q:92 t:92J> 0.:9:8DX .:8;0?4?4A0 ;0= >0Zr9 .0=?,49 >0.?:=>X ?34> 4> >48;7D , =0>@7? :1 8,=60? 1:=.0>Z ,9/ .:9.7@/0/ ?3,? .:8;0?4?4:9 4> -0>? 9@=?@=0/ ,9/ >@>?,490/ -D ,77:B492 ?30 1=00 w:90?3070>>X 49 >:80 >0.?:=> >@.3 /:849,?4:9 4> .:8-490/ B4?3 :?30= 1,.?:=>X B4?3 ;7,D :1 8,=60? 1:=.0>Zr? 1@=?30= .:8809?0/ ?3,? ,9D 90B ,;;=:,.3 ?: .:8;0?4?4:9 ?30 =0>@7? ?3,? ?30 ;:>>4-474?D :1 ,9?4Y.:8;0?4?4A0 -03,A4:@= 0C4>?>Z|30>0 1,.?:=> ;:74.DX 49.7@/492 7024>7,?4:9 >3:@7/ >0=A0 ?30 ;@=;:>0 :1 093,9.492 0.:9:84. 0114.409.D 49.7@/0 3423 8,=60? 09?=D -,==40=>X ;=4.0 4907,>?4. /08,9/X 7484?0/ ;=:/@.? /4110=09?4,?4:9 ,9/ ?30 1=00 17:B :1 ?=,/0X ?30=0-D ,7>: -09014?492 .:9>@80= B071,=0Z|30 ,48 >3:@7/ B4?3 .:8;0?4?4:9 8,497D :9 ;=4.0X ;=0/4.?,-70 /08,9/ ,9/ 8,=60? >3,=0X ,9/ A0=?4.,7 9:? -0 ?: -09014? := ?: ?,=20? >;0.414. >0.?:=>X 9:= ?: >?48@7,?0 := 49?=:/@.0 .:8;0?4?4:9 49?02=,?4:9Zw:90?3070>>X 0A09 ?3:@23 ?30 8,=60? >?=@.?@=0 8423? 3,A0 070809?> ,=?414.4,77DZz,?30=X ?30 60D :-50.?4A0> >3:@7/ -0 ?: =0491:=.0 -@>490>> ,9/ .:9>@80= ?3,? .:@7/ ,77:B 1:= ,9?4Y.:8;0?4?4A0 .:9/@.?X 4? /:0> 9:? 90.0>>,=47D 1:77:B ?3,? >@.3 .:914/09.0X 093,9.0 q:92 t:92J> ;=:Y09?0=;=4>0X ;=:Y8,=60? 09A4=:9809? ,9/ ?: .:9/@.? 4> ;=0>09?Z ;=:A4/0 , 70A07 ;7,D492Y1407/ 1:= ,77 -D .:8-,?492 ,9?4Y.:8;0?4?4A0 -03,A4:@=Z

sv sw K*30=0 5@>?4140/X ?30 p:A0=9809? B477 ?,60 ,/8494>?=,?4A0 := 702,7 >?0;> ,> ,;;=:;=4,?0 `bZ w:90?3070>>X ?30=0 ,=0 ,7>: ,=2@809?> ?3,? 8,D -0 ,/A,9.0/ 49 >@;;:=? :1 8,49?,49492 ?: =08:A0 >@.3 ;=,.?4.0> 41 90.0>>,=DZL ?30 .@==09? 1=,80B:=6 1:= 48;70809?492 .:8;0?4?4:9 ;:74.DX 1:= 0C,8;70 I

M r9?=:/@.492 , 90B .=:>>Y>0.?:= 7,B .:@7/ 49.=0,>0 ?30 .:>? :1 /:492 -@>490>> 7:.,77DX ``Z r9 ;=,.?4.0X :@?>4/0 :1 ?30 ?070.:88@94.,?4:9> ,9/ -=:,/.,>?492 >0.?:=>X ?30=0 ,=0 ;,=?4.@7,=7D 1:= {vn>X ,9/ .:@7/ ,110.? q:92 t:92J> =024:9,7 .:8;0?4?4A090>>g 9: >?,?@?:=D ;=:.0/@=0> ?3,? ?30 p:A0=9809? .,9 ?,60 ?: =0429 49 -@>490>>0> ?3,? ,=0 092,20/ 49 =0>?=4.?4A0 ;=,.?4.0> ?3,? 8423? 48;,4= q:92 t:92J> 0.:9:84. 0114.409.DZ M q:92 t:92 4> ,7=0,/D , 1=00 ,9/ .:8;0?4?4A0 8,=60? ,9/ ?30=0 4> 9: 900/ ?: 49?0=10=0 l@==09?7DX B30=0 ;:>>4-70 .,>0> :1 ,9?4Y.:8;0?4?4A0 .:9/@.? ,=0 -=:@23? ?: ?30 B4?3 9:=8,7 -@>490>> :;0=,?4:9> 49 , 8,=60? ;7,.0 ?3,? ,7=0,/D B:=6> B077g ,9/ ,??09?4:9 :1 lxvyjpX 4? 2090=,77D ,>6> ?30 2:A0=9809? -@=0,@ =0>;:9>4-70 1:= ?30 >0.?:= .:9.0=90/ ?: 49A0>?42,?0 B30?30= >@.3 .:9/@.? 3,> 49 1,.? ?,609 ;7,.0Z M |30=0 ,=0 :?30= B,D> ?: 093,9.0 .:8;0?4?4:9 49 7:.,7 8,=60?> B4?3:@? 49?=:/@.492 r g q:B0A0=X >@.3 49A0>?42,?4:9>X ,9/ -D 0C?09>4:9X ?30 0110.?4A0 48;70809?,?4:9 :1 ?30 , 90B .:8;0?4?4:9 7,BZ 81@D5B .:8;0?4?4:9 ;:74.D ,=0 .:9>?=,490/ -D ?B: 1,.?:=>X 9,807D I 81@D5B g

r `cZ |B: 1@=?30= ;:49?> 8423? -0 .:9>4/0=0/ B309 ,>>0>>492 ?30 900/ 1:= 90B 7024>7,?4:9X M |30 2:A0=9809? -@=0,@ ?,>60/ B4?3 49A0>?42,?492 , .:8;7,49? :1 ;:>>4-70 ,9?4Y ?3,? 4> I .:8;0?4?4A0 .:9/@.? .,9 :97D =0<@0>? .::;0=,?4:9 1=:8 ?30 ;,=?D @9/0= 49A0>?42,?4:9 I 4? 3,> 9: >?,?@?:=D ;:B0= ?: =0<@4=0 ?30 ;=:A4>4:9 :1 491:=8,?4:9 ?3,? 8423? -0 M *4?3:@? , 90B .:8;0?4?4:9 7,B ?30=0 B477 -0 , 900/ ?: >?=092?309 ?30 .@==09? =070A,9? ?: ?30 .,>0g ,9/ 80.3,94>8> 1:= 49A0>?42,?492 ,9/ ;@-74.4>492 .,>0> :1 ,9?4Y.:8;0?4?4A0 .:9/@.?X 41 B0 49?09/ ?: ?,60 >?=:920= >?0;> ?: /0?0= >@.3 .:9/@.? ,9/ ?: 0/@.,?0 ?30 M nA09 41 , .:8;7,49? :1 ,9?4Y.:8;0?4?4A0 .:9/@.? 4> >@->?,9?4,?0/X lxvyjp 3,> 9: .:88@94?D ,> ?: ?30 >?,9/,=/> :1 -@>490>> ;=,.?4.0 ?3,? ,=0 ,;;=:;=4,?0 1:= ,9 ;:B0= ?: >,9.?4:9 ?30 ;,=?D := ;,=?40> .:9.0=90/ := ?: =0<@4=0 ?308 ?: /0>4>? 1=:8 ,/A,9.0/ 0.:9:8D >@.3 ,> q:92 t:92J>g ,9/ ?30 =0>?=4.?4A0 ;=,.?4.0 49 <@0>?4:9Z M r1 ?30=0 4> ?: -0 c pgy eqorgvkvkqp ncy 4? >3:@7/ 9:? .=0,?0 , >429414.,9? ,//4?4:9,7 h}rpvsvp X|{+vqr*n,v|{+ -@=/09 :9 7:.,7 -@>490>>X 9:= 09.:@=,20 49?0=10=09.0 B4?3 9:=8,7 -@>490>> ;=,.?4.0> Q[|* n{q ntnv{+, v{,*|q-pv{t n {r/ p|z}r,v,v|{ yn/R := 0.:9:84.,77D 0114.409? 8,=60? >?=@.?@=0>Z

`aZ k0,=492 49 849/ ?30 .@==09? >4?@,?4:9 49 q:92 t:92X 49 ,//4?4:9 ?: ?30 -09014?> >0? o:77:B492 ;@-74.,?4:9 :1 ?30 lyzl =0;:=?X .:9.0=9> B0=0 =,4>0/X 0>;0.4,77D -D :@? 49 ;,=,2=,;3 ^e ,-:A0X ,=2@809?> ?3,? 8423? -0 ;@? 1:=B,=/ 49 >@;;:=? :1 =0;=0>09?,?4A0> :1 {vn>X ?3,? ?30 49?=:/@.?4:9 :1 , 90B 7,B .:@7/ 70,/ ?: 34230= 49?=:/@.492 , .:8;0?4?4:9 7,B 49.7@/0 I -@>490>> .:>?>X ,9/ ?3,? 7,=20= 14=8> .:@7/ @>0 >@.3 , 7,B ?: ;@? ;=0>>@=0 :9 >8,77 .:8;,940> ?3=:@23 @91:@9/0/ .:8;7,49?> := 702,7 ,.?4:9Zq:B0A0=X 0A4/09.0 1=:8 M j 90B 7,B B:@7/ 48;=:A0 ?=,9>;,=09.D ?3=:@23 /07490,?492 B3,? .:9>?4?@?0> ,9?4Y :?30= 5@=4>/4.?4:9> >@220>?> ?3,? {vn> 3,A0 74??70 ?: 10,= 1=:8 , .,=01@77D 1=,80/ .:8;0?4?4A0 .:9/@.? ?3=:@23:@? ?30 0.:9:8DX ,9/ B:@7/ >09/ , .70,= >429,7 ,> .:8;0?4?4:9 7,BZ ?: ?30 >?,9/,=/> :1 -@>490>> .:9/@.? ?3,? B0 B:@7/ B4>3 ?: ;=:8:?0 49 q:92 t:92X ?30=0-D 09.:@=,2492 >071 /4>.4;7490 -D @9/0=?,6492>g ,9/

M j 90B 7,B ?3,? ?,=20?> ,9?4Y.:8;0?4?4A0 .:9/@.? -@? 9:? ?30 >4E0 ,9/ 9@8-0= :1 .:8;0?4?:=> B:@7/ 9:? /4>?@=- 8,=60? >?=@.?@=0X B34.3 4> :1?09 ?30 =0>@7? :1 1=00 ;7,D :1 8,=60? 1:=.0> 49 q:92 t:92Z

sx sy K*30=0 5@>?4140/X ?30 p:A0=9809? B477 ?,60 ,/8494>?=,?4A0 := 702,7 >?0;> ,> ,;;=:;=4,?0 `bZ w:90?3070>>X ?30=0 ,=0 ,7>: ,=2@809?> ?3,? 8,D -0 ,/A,9.0/ 49 >@;;:=? :1 8,49?,49492 ?: =08:A0 >@.3 ;=,.?4.0> 41 90.0>>,=DZL ?30 .@==09? 1=,80B:=6 1:= 48;70809?492 .:8;0?4?4:9 ;:74.DX 1:= 0C,8;70 I

M j 90B 7,B ?3,? ?,=20?> ,9?4Y.:8;0?4?4A0 .:9/@.? -@? 9:? ?30 >4E0 ,9/ 9@8-0= :1 .:8;0?4?:=> B:@7/ 9:? /4>?@=- 8,=60? >?=@.?@=0X B34.3 4> :1?09 ?30 =0>@7? :1 1=00 ;7,D :1 8,=60? 1:=.0> 49 q:92 t:92Z

sx sy `dZ |30 =08,49492 60D .:9>4/0=,?4:9> 49 ?34> l3,;?0= ,=0 -,>0/ :9 ?30 ,>>@8;?4:9 ?3,? 1KICOF ANCMM >:80 1:=8 :1 90B .:8;0?4?4:9 7,B 4> =0<@4=0/ ?: 09>@=0 ?30 0110.?4A0 48;70809?,?4:9 :1 .:8;0?4?4:9 ;:74.DZr9 >@.3 /074-0=,?4:9>X 4? 4> 48;:=?,9? ?: 3,A0 =02,=/ ?: ?30 *309 :A0=>0,> 5@=4>/4.?4:9> 14=>? >?,=?0/ ;,>>492 .:8;0?4?4:9 7,B>X :90 :1 ?30 q:92 t:92 .:9?0C?X ,9/ ?: ,>6 :@=>07A0> B3,? 702,7 ,9/ 49>?4?@?4:9,7 >0? @; B:@7/ 60D :-50.?4A0> B,> :1?09 ?: ,//=0>> ?30 @9/@0 .:9.09?=,?4:9 :1 8,=60? ;:B0=Z -0>? >@4? ?30 .4=.@8>?,9.0> :1 q:92 t:92Z |30 1:.@> B,> ?30=01:=0 :9 ?30 =02@7,?4:9 :1 8,=60? >?=@.?@=0> ,9/ -42 .:8;,940>Z

j 8:=0 =0.09? ,;;=:,.3 ?: =02@7,?492 .:8;0?4?4:9 3,> -009 ?: ;=:34-4? ,9?4Y .:8;0?4?4A0 .:9/@.? =,?30= ?3,9 ?: ,//=0>> 8,=60? >?=@.?@=0> := 8:9:;:7D ;:B0=Z 4XTGOT PH C ,;;740> 0<@,77D ?: -42 ,9/ >8,77 .:8;,940> ?3,? 092,20 49 >@.3 AGETPR AQGEKHKE PR 2RPSS+AGETPR r g .:9/@.?Zr9 ;=,.?4.0X 24A09 ?304= 7,.6 :1 8,=60? ;:B0=X ?30 ,.?4:9> :1 {vn>,=0 81@D5B @974607D ?: 3,A0 ?30 0110.? :1 >429414.,9?7D ;=0A09?492X =0>?=4.?492 := /4>?:=?492 81@D5B g r .:8;0?4?4:9Zr? 4> =07,?4A07D @9.:88:9 1:= {vn> ?: -0 ;=:>0.@?0/ 49 :A0=>0,> 68? 7>8<=9;: -5 5@=4>/4.?4:9>X @970>> ?30 7,B ;=:A4/0> 1:= K;0= >0L :1109.0>X 4Z0ZX .:9/@.? ?3,? 4> -8?E<4 1>I >5G 3?=@5D9D9?> <1G 5HD5>4 D? ,7B,D> ,>>@80/ ?: .,@>0 3,=8 ?: .:8;0?4?4:9 ,9/ ?: 3,A0 74??70 0.:9:84. -09014?Z 1<< C53D?BC ?6 D85 53?>?=Ia ?B C8?E<4 9D ?> ;=4.0Y14C492X -4/Y=422492 ,9/ 8,=60? ,77:.,?4:9Z 1 <9=9D54 >E=25B ?6 C53D?BCa <51F9>7 D85 B5=19>9>7 l:8;0?4?4:9 ,@?3:=4?40> @9/0=>?,9/ ?3,? >:80 .::;0=,?4A0 ,==,920809?> .:88:9 C53D?BC @EB59CDB1D9F5 ?F5BC978Do ,8:92 {vn>X 1:= 0C,8;70 491:=8,?4:9 >3,=492 ,9/ 5:49? ;@=.3,>492X 8,D ,.?@,77D 3,A0 ;=:Y.:8;0?4?4A0 -09014?> B309 .0=?,49 .:9/4?4:9> ,=0 80?Zz02@7,?4:9 :1 {vn .:9/@.? 4> 9:? 9:=8,77D , ;=4:=4?D 1:= .:8;0?4?4:9 ,@?3:=4?40>Z `eZ l:8;0?4?4:9 7,B> 49 ?30 5@=4>/4.?4:9> >@=A0D0/ 49 l3,;?0= ^ ,;;7D 49 ;=49.4;70 ?: ,77 >0.?:=> :1 ?30 0.:9:8D I ,7?3:@23 ?30 7,B> /: ,77:B 1:= 0C08;?4:9> 49 .0=?,49 r9 :=/0= ?: 600; {vn> 491:=80/X ,9/ =0.:294>492 ?3,? >8,77 .:8;,940> 3,A0 .4=.@8>?,9.0> V>00 ;,=,2=,;3> d\ ?: d` 49 ?34> l3,;?0= 1:= , /4>.@>>4:9 :1 ?30 4>>@0 7484?0/ =0>:@=.0> 49 3,9/7492 .:8;74,9.0 4>>@0>X 4? 4> .:88:9 1:= :A0=>0,> :1 0C.7@>4:9> ,9/ 0C08;?4:9>WZ }9/0= :@= .@==09? ,==,920809?>X ?30 ?070.:88@94.,?4:9> .:8;0?4?4:9 ,@?3:=4?40> ?: 4>>@0 2@4/07490> :9 ?30 =02@7,?4:9 :1 {vn .:9/@.?Z ,9/ -=:,/.,>?492 >0.?:=> 3,A0 7024>7,?4:9 .:9?,49492 .:8;0?4?4:9 ;=:A4>4:9>X B347>? o:= 0C,8;70X 49 ?30 }{jX ?30 j9?4Y?=@>? p@4/07490> 1:= l:77,-:=,?4:9> ,8:92 1:= :?30= >0.?:=>X .:8;7,49?> :1 ,9?4Y.:8;0?4?4A0 .:9/@.? ,=0 3,9/70/ :9 , .,>0Y-DY l:8;0?4?:=> 4>>@0/ 5:49?7D -D ?30 o0/0=,7 |=,/0 l:884>>4:9 ,9/ ?30 }{ m0;,=?809? .,>0 -,>4>Z :1 s@>?4.0 VmxsW >?,?0 ?3,?X :?30= ?3,9 49 0C?=,:=/49,=D .4=.@8>?,9.0>X ?30 ,@?3:=4?40> /: 9:? .3,770920 , .:77,-:=,?4:9 -0?B009 .:8;0?4?:=> B309 ?30 8,=60? >3,=0> a\Z r1 ?30 p:A0=9809? B0=0 ?: 49?=:/@.0 , 90B .:8;0?4?4:9 7,B 1:= q:92 t:92X :90 :1 ?30 ;,=?4.4;,9?> ,9/ ?30 .:77,-:=,?4:9 49A:7A0/ .:770.?4A07D ,..:@9? 1:= 9: 8:=0 :1 ?30 14=>? .:9>4/0=,?4:9> B:@7/ -0 B30?30= >@.3 , 7,B >3:@7/ -0 K.=:>>Y>0.?:=L 49 ?3,9 ^\S :1 0,.3 8,=60? 49 B34.3 .:8;0?4?4:9 8,D -0 ,110.?0/Z 9,?@=0X 4Z0ZX .:A0=492 ,77 >0.?:=> :1 ?30 0.:9:8DX := >3:@7/ 5@>? ?,=20? >0.?:=> B30=0 ?30 =4>6 :1 ,9?4Y.:8;0?4?4A0 .:9/@.? B,> 107? ?: -0 ;,=?4.@7,=7D ,.@?0Z |30=0 3,A0 -009 .,>0> B30=0 ?30 }{ mxs .:9.7@/0> ?3,? , 5:49? ;@=.3,>492 ,>>:.4,?4:9 0>?,-74>30/ -D {vn> 3,> ;=:Y.:8;0?4?4A0 -09014?> ?3=:@23 =0/@.492 h}rpvsvp X|{+vqr*n,v|{+/v,u *rtn*q ,|n5X*|++T+rp,|*6 V}}*|npu .:>?> ,9/ 3,> 9: ,9?4Y.:8;0?4?4A0 3,=8Zr9 {492,;:=0X ?30 2@4/07490> ;@-74>30/ -D ?30 l:8;0?4?4:9 l:884>>4:9 >?,?0 ?3,? ,9 ,2=00809? B477 2090=,77D 3,A0 9: a]Z |30=0 4> ?30 A40B ?3,? 0C?09/492 .:8;0?4?4:9 7,B ,.=:>> ,77 >0.?:=> :1 ?30 0.:9:8D ,;;=0.4,-70 ,/A0=>0 0110.? :9 .:8;0?4?4:9 41 ?30 ,22=02,?0 8,=60? >3,=0 :1 ?30 8423? ,/A0=>07D ,110.? -@>490>> .:914/09.0 -D .=0,?492 @9.0=?,49?D ,> ?: B34.3 ;,=?40> ?: ?30 ,2=00809? /:0> 9:? 0C.00/ ^\SZ |30 2@4/07490> ,7>: >?,?0 0C;74.4?7D 49/@>?=40> 8423? -0 ?,=20?0/ -D ?30 =02@7,?:=Zx90 8423? ,7>: ,=2@0 ?3,? ?30 .@==09? ?3,? ,2=00809?> -0?B009 {vn> ,=0 =,=07D .,;,-70 :1 /4>?:=?492 .:8;0?4?4:9 >0.?:= >;0.414. ,;;=:,.3 ?: 7024>7,?492 1:= .:8;0?4?4:9 49 q:92 t:92 4> B077 @9/0=>?::/ ,;;=0.4,-7DX ,9/ =0.:294>0 ?3,? .:8;0?4?4:9 8,D -0 093,9.0/ -DX 1:= 0C,8;70X -D -@>490>> ,9/ .:9>@80=>X ,9/ ?3,? 4? B:@7/ -0 8:=0 ;=@/09? ?: 0C?09/ ?34> ?: >3,=492 :1 491:=8,?4:9 :9 90B ?0.39:7:240> := 8,=60? :;;:=?@94?40>Z .:A0= :97D ?3:>0 8,=60?> B30=0 .:8;0?4?4:9 B,> 107? ?: -0 ,9 4>>@0 :1 .:9.0=9X =,?30= ?3,9 ?: 49?=:/@.0 , .=:>>Y>0.?:= 7,BZ

sz s{ `dZ |30 =08,49492 60D .:9>4/0=,?4:9> 49 ?34> l3,;?0= ,=0 -,>0/ :9 ?30 ,>>@8;?4:9 ?3,? 1KICOF ANCMM >:80 1:=8 :1 90B .:8;0?4?4:9 7,B 4> =0<@4=0/ ?: 09>@=0 ?30 0110.?4A0 48;70809?,?4:9 :1 .:8;0?4?4:9 ;:74.DZr9 >@.3 /074-0=,?4:9>X 4? 4> 48;:=?,9? ?: 3,A0 =02,=/ ?: ?30 *309 :A0=>0,> 5@=4>/4.?4:9> 14=>? >?,=?0/ ;,>>492 .:8;0?4?4:9 7,B>X :90 :1 ?30 q:92 t:92 .:9?0C?X ,9/ ?: ,>6 :@=>07A0> B3,? 702,7 ,9/ 49>?4?@?4:9,7 >0? @; B:@7/ 60D :-50.?4A0> B,> :1?09 ?: ,//=0>> ?30 @9/@0 .:9.09?=,?4:9 :1 8,=60? ;:B0=Z -0>? >@4? ?30 .4=.@8>?,9.0> :1 q:92 t:92Z |30 1:.@> B,> ?30=01:=0 :9 ?30 =02@7,?4:9 :1 8,=60? >?=@.?@=0> ,9/ -42 .:8;,940>Z

sz s{ a^Z j9:?30= ,=2@809? ?3,? 8423? -0 8,/0 ,2,49>? 3,A492 , .=:>>Y>0.?:= .:8;0?4?4:9 AEPQG PH 1GJCVKPUR TP DG 2PVGRGF DY 2PNQGTKTKPO :CW 7,B 4> ?3,? 0,.3 >0.?:= 3,> 4?> :B9 .3,=,.?0=4>?4.> ?3,? .:@7/ 9:? -0 >,?4>1,.?:=47D ,//=0>>0/ -D , >49270X ,.=:>>Y?30Y-:,=/ ;40.0 :1 7024>7,?4:9Zr? .:@7/ ,7>: -0 ,=2@0/ ?3,? , >0.?:= >;0.414. ,;;=:,.3 4> .:9>4>?09? B4?3 ?30 ,;;=:,.3 ?: /,?0X 24A09 ?3,? 68? 7>8<=9;: .5 ?30 ?070.:88@94.,?4:9> ,9/ -=:,/.,>?492 49/@>?=40> ,=0 >@-50.? ?: >0;,=,?0 .:8;0?4?4:9 -8?E<4 D85 C3?@5 ?6 1>I >5G 3?=@5D9D9?> <1G 3?F5B 7024>7,?4:9 ,9/ =02@7,?:=D .:9?=:7Z ?>D9b3?=@5D9D9F5 3?>4E3Da ?B C8?E<4 9D 13 ?6 a_Z x9 ?30 :?30= 3,9/X ,> ,9?4Y.:8;0?4?4A0 .:9/@.? .:@7/ :..@= 49 ,9D >0.?:=X 8,9D =1B;5D CDBE3DEB5Ca 9>37 =?>?@?<95C 1>4 .:8809?,?:=> 3,A0 ;:49?0/ :@? ?3,? ?30=0 ,=0 9: >?=:92 2=:@9/> 1:= ?,=20?492 :97D =5B75BC 1>4 13AE9C9D9?>Co r g .0=?,49 49/4A4/@,7 >0.?:=> := 49/@>?=40> 1:= =02@7,?4:9Z *347>? ?30=0 8423? -0 , .:88:9 81@D5B ;0=.0;?4:9 ?3,? .0=?,49 >;0.414. >0.?:=> ,=0 ;,=?4.@7,=7D A@790=,-70 ?: ,9?4Y.:8;0?4?4A0 81@D5B g r -03,A4:@=X ?30 ;=:1470 :1 .:8;7,49?> ?: lxvyjp 49 =0.09? D0,=> I ,;;09/0/ ,? ?30 abZ z02,=/70>> :1 B30?30= ,9D 90B .:8;0?4?4:9 7,B 0C?09/> ?: ,77 >0.?:=> :1 ?30 0.:9:8D j??,.3809? ?: ?34> /:.@809? I 49/4.,?0> ?3,? ?30=0 4> , .:9.0=9 ?3,? ,9?4Y.:8;0?4?4A0 := 5@>? ?: , 7484?0/ 9@8-0= :1 >0.?:=>X ?30=0 4> , 900/ ?: .:9>4/0= .,=01@77D ?30 >.:;0 .:9/@.? 0C4>?> 49 , 7,=20 9@8-0= :1 >0.?:=>Zr9 ,//4?4:9X 4? 4> .70,= ?3,? ?30 .@==09? :1 ?30 -03,A4:@= ?3,? >@.3 , 7,B 8423? .:A0=Zu024>7,?4:9 49 :?30= 5@=4>/4.?4:9> 2090=,77D ;:74.D >0? :@? 49 ?30 lxvyjp {?,?0809? /:0> 9:? /4>.=4849,?0 -0?B009 >0.?:=>X -@? ,//=0>>0> ?30 1:77:B492 ?D;0> :1 .:9/@.? I ,;;740> 0<@,77D ?: ,77Z M z0>?=4.?4A0 ,2=00809?>g

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b\Z |30 >@-84>>4:9> =0.04A0/ -D ?30 lyzl 2090=,77D 49/4.,?0/ ?3,? ?30=0 B,> 9: .70,= 5@>?414.,?4:9 ,? ?34> ?480 1:= ?30 =02@7,?4:9 :1 80=20=> ,9/ ,.<@4>4?4:9> VvTjW :@?>4/0 b^Z r9 4?> =0;:=? :9 ?30 =0A40B :1 .:8;0?4?4:9 ;:74.DX ?30 lyzl =0.:8809/0/ ?3,? , 90B ?30 702,7 ;=:A4>4:9> 2:A0=9492 :B90=>34; 49 ?30 -=:,/.,>?492 ,9/ ?070.:88@94.,?4:9> .=:>>Y>0.?:= .:8;0?4?4:9 7,B >3:@7/ ,//=0>> >0A09 ?D;0> :1 ,9?4Y.:8;0?4?4A0 .:9/@.?Z >0.?:=>Zo@=?30=8:=0X 4? 8423? -0 ,=2@0/ ?3,? ,? ?30 494?4,7 >?,20 :1 -=492492 49 , |30>0 ,=0 /4>.@>>0/ 49 /0?,47 49 ?30 1:77:B492 ;,=,2=,;3>Z|30 14=>? >4C ?D;0> :1 .:9/@.? 90B .:8;0?4?4:9 7,BX 4? B:@7/ -0 ;=010=,-70 ?: 1:.@> =02@7,?:=D =0>:@=.0> :9 ,=0,> V4Z0ZX ,77 0C.0;? ,-@>0 :1 , /:849,9? 8,=60? ;:>4?4:9X B34.3 4> @>@,77D ?=0,?0/ ,> , B30=0 ?30=0 ,=0 ;0=.04A0/ ?: -0 ?30 2=0,?0>? ;=:-708>X =,?30= ?3,9 ?: ?=D ?: .:A0= .,?02:=D 49 4?> :B9 =423?W ,=0 :1?09 2=:@;0/ @9/0= ?30 -=:,/ .,?02:=D =010==0/ ?: ,77 ;:>>4-70 ,=0,> :1 ?30 7,B ,> 4? ,;;740> 49 :?30= 5@=4>/4.?4:9>Z ,> K=0>?=4.?4A0 ,2=00809?>LZ

b]Z w:90?3070>>X 0A09 ?3:@23 vTj ,.?4A4?D 8423? 9:? .@==09?7D ;:>0 , ?3=0,? ?: .:8;0?4?4:9 e*vprTsv0v{t 49 q:92 t:92X ?30=0 4> ?30 ;:>>4-474?D ?3,? B4?3:@? =02@7,?4:9 :1 vTjX .:8;,940> .:@7/ >48;7D 80=20 49 :=/0= ?: .4=.@8A09? 90B 7,B> ,2,49>? ,9?4Y.:8;0?4?4A0 .,=?07 b_Z y=4.0Y14C492 :1?09 =010=> ?: ,9 ,2=00809? ,8:92 .:8;0?4?:=> ?: =,4>0X 14C := :?30=B4>0 .:9/@.? := :?30= ;=:34-4?0/ ;=,.?4.0>Z|30=0 8,D ?30=01:=0 -0 ,9 ,=2@809? 1:= 8,49?,49 ?30 ;=4.0 ,? B34.3 ?304= 2::/> := >0=A4.0> ,=0 >:7/Z{@.3 ,9 ,2=00809? 8,D >09/492 , >429,7 ?: ?30 -@>490>> >0.?:= ?3,? ,9?4Y.:8;0?4?4A0 vTj ,.?4A4?40> B:@7/ 49A:7A0 14C492 04?30= ?30 ;=4.0 4?>071 := ?30 .:8;:909?> :1 , ;=4.0X 0>?,-74>3492 ?30 9:? -0 ?:70=,?0/X 1:= 0C,8;70X -D 49.7@/492 49 ?30 90B .:8;0?4?4:9 7,B ;=:A4>4:9> ,8:@9? := ;0=.09?,20 -D B34.3 ;=4.0> ,=0 ?: -0 49.=0,>0/X := 0>?,-74>3492 , =,920 =02@7,?492 vTj ,.?4A4?40> ?3,? ,=0 ?: .:80 49?: 0110.? 9:? 4880/4,?07D @;:9 09,.?809? :@?>4/0 B34.3 ;=4.0> ,=0 9:? ?: 8:A0Z -@? ,? ,9 ,;;=:;=4,?0 ?480 49 1@?@=0Zr9/00/X ?30 ?48492 1:= ?30 vTj ;=:A4>4:9> ?:

tt tu b|{|}|yvr+ n{q br*tr*+ n{q Vp~-v+v,v|{+ ?,60 0110.? .:@7/ -0 >@-50.? ?: , 1@=?30= =0A40B >: ?3,? 0C;0=409.0 B4?3 ?30 90B 7,B .,9 -0 1@77D ?,609 49?: ,..:@9?Z adZ |30 lyzl 49 4?> =0;:=? =0.:8809/0/ ,2,49>? ?,=20?492 8,=60? >?=@.?@=0> := >006492 ?: =02@7,?0 K9,?@=,7L 8:9:;:740>X ;=:;:>492 49>?0,/ ?3,? ?30 1:.@> :1 , 90B .:8;0?4?4:9 7,B >3:@7/ -0 :9 ?30 ,.?@,7 .:9/@.? :1 14=8> B4?349 ?30 8,=60?> .:9.0=90/Z BYQGS PH 1GJCVKPUR TP DG @GICRFGF CS r? ,7>: :->0=A0/ ?3,? 49 q:92 t:92X ?30=0 B,> 9: .70,= 49/4.,?4:9 ?3,? 80=20= ,9/ \0OTK+EPNQGTKTKVG 2POFUET] COF TJG 0QQRPCEJ TP DG ,.<@4>4?4:9 ,.?4A4?D B,> .@==09?7D , ?3=0,? ?: .:8;0?4?4:9Z *347>? >:80 .:8809?,?:=> 0FPQTGF KO 3GHKOKOIAUEJ 2POFUET 3,A0 ;:49?0/ :@? ?3,? 8,=60? >?=@.?@=0 4> ,//=0>>0/ -D 8,9D :A0=>0,> .:8;0?4?4:9 =02480>X :?30=> >@220>? ?3,? , .:8;0?4?4:9 7,B 1:= q:92 t:92 >3:@7/ 9:?X ,? 70,>? r g ,? ?30 494?4,7 >?,20X ?,=20? 8:9:;:740>X ?,6492 ?30 A40B ?3,? .@==09? 8,=60? >?=@.?@=0> 68? 7>8<=9;: /5 81@D5B ,=0 2090=,77D ?30 =0>@7? :1 9:=8,7 1=00 8,=60? 1:=.0>Z -8?E<4 1 >5G 3?=@5D9D9?> <1G 4569>5 9> 45D19< 81@D5B g r D85 C@539693 DI@5C ?6 1>D9b3?=@5D9D9F5 3?>4E3D D? 25 3?F5B54a aeZ r? 3,> ,7>: -009 >@220>?0/ ?3,? ?30 ;=0>09.0 :1 , 8:9:;:7D 49 , 24A09 0.:9:84. ?B C8?E<4 9D C9=@5B1< @B?8929D9?> >0.?:= /:0> 9:? 90.0>>,=47D =0/@.0 0.:9:84. 0114.409.DZr9 , =07,?4A07D .:8;,.? 1719>CD 1>D9b3?=@5D9D9F5 3?>4E3D G9D8 5H1=@<5C 20:2=,;34.,7 ,=0,X >@.3 ,> q:92 t:92X ?30=0 8,D -0 7484?0/ -@>490>> >.:;0 1:= ?6 CE38 3?>4E3Do 8@7?4;70 ;=:A4/0=> :1 .0=?,49 ;=:/@.?> := >0=A4.0> ?: .:Y0C4>?X ;,=?4.@7,=7D ?3:>0 ?3,? =0<@4=0 3423 70A07> :1 K>@96L 49A0>?809?Zr9 >@.3 .,>0>X ?30 ;=:A4>4:9 :1 ;=:/@.?> := >0=A4.0> -D :90 := , 10B .:8;,940> 8423? -0 ?30 8:>? 0.:9:84.,77D 0114.409? 68? 7>8<=9;: 05 >4?@,?4:9Zx90 1@=?30= .:9>4/0=,?4:9 4> ?3,? ,> 7:92 ,> ?30=0 ,=0 0110.?4A0 >,102@,=/> -8?E<4 1 >5G 3?=@5D9D9?> <1G 19= D? 144B5CC ?>? ,9?4Y.:8;0?4?4A0 .:9/@.?X 4? 8423? B077 -0 >@;0=17@:@> ?: /0A4>0 , =02480 ?: C5F5> DI@5C ?6 3?>4E3D 945>D96954 2I D85 r*,ra ?,=20? 8,=60? >?=@.?@=0>X >49.0 ,9 @9/0=?,6492 095:D492 8,=60? /:849,9.0 ,9/ ?B C8?E<4 1449D9?>1< DI@5C ?6 3?>4E3D 13 8,=60? ;:>4?4:9 B:@7/ 49 ,9D 1>4 C8?E<4 D85 <579C<1D9?> 25 CE@@?BD54 2I D85 9CCE5 ?6 0A09? -0 .,@23? @9/0= ?30 7,BZ 7E945<9>5C 2I D85 B57E<1D?BI 1ED8?B9DIo

tt tu b`Z y=4.0Y14C492 8,D ,7>: ?,60 ?30 1:=8 :1 ,9 ,2=00809? ?: =0>?=4.? ;=4.0 .:8;0?4?4:9Z bbZ k4/Y=422492 ,2=00809?> @>@,77D 1,77 49?: :90 := 8:=0 :1 ?30 1:77:B492 .,?02:=40> I |34> .,9 49.7@/0X 1:= 0C,8;70X ,9 ,2=00809? ?: ,/30=0 ?: ;@-74>30/ ;=4.0 74>?> := 9:? M k4/ >@;;=0>>4:9fx90 := 8:=0 .:8;0?4?:=> B3: :?30=B4>0 B:@7/ -0 0C;0.?0/ ?: ?: <@:?0 , ;=4.0 B4?3:@? .:9>@7?492 ;:?09?4,7 .:8;0?4?:=>X := 9:? ?: .3,=20 70>> ?3,9 -4/X := B3: 3,> ;=0A4:@>7D 8,/0 , -4/X ,2=00> ?: =01=,49 1=:8 -4//492 := B4?3/=,B> ,9D :?30= ;=4.0 49 ?30 8,=60?Zj9 ,2=00809? 8,D =0>?=4.? ;=4.0 .:8;0?4?4:9 0A09 41 , ;=0A4:@>7D >@-84??0/ -4/ >: ?3,? ?30 /0>429,?0/ B499492 .:8;0?4?:=J> -4/ B477 -0 4? /:0> 9:? 09?4=07D 074849,?0 4?Z ,..0;?0/Z

M l:8;70809?,=D -4//492f{:80 .:8;0?4?:=> ,2=00 ?: >@-84? -4/> ?3,? ,=0 04?30= er,*|y }*vpr+ v{ kvp,|*vnS V-+,*nyvn ?:: 3423 ?: -0 ,..0;?0/ := .:9?,49 ?0=8> ?3,? ?30D 69:B B477 9:? -0 ,..0;?,-70 ?: ?30 -@D0=>Z{@.3 -4/> ,=0 8,/0 80=07D ?: 24A0 ?30 ,;;0,=,9.0 :1 209@490

r9 ^\\^X ?30 j@>?=,74,9 l:8;0?4?4:9 ,9/ l:9>@80= l:884>>4:9 VjlllW 49>?4?@?0/ r g .:8;0?4?4A0 -4//492Z 81@D5B .:@=? ;=:.00/492> ,2,49>? >0A09 .:8;,940> ,9/ >0A09 49/4A4/@,7> 49A:7A0/ 49 ?30 81@D5B /4>?=4-@?4:9 ,9/ =0?,47 :1 ;0?=:7 49 ?30 >?,?0 :1 ~4.?:=4,X :9 ?30 2=:@9/> ?3,? ?30>0 g r M k4/ =:?,?4:9fy,=?40> ?: ?30 ,2=00809? >@-84? -4/> -@? ?,60 ?@=9> ,? -0492 ?30 7:B0>? .:8;,940> ,9/ 49/4A4/@,7> 3,/ 09?0=0/ 49?: ,9/ 24A09 0110.? ?: ,==,920809?> -4//0=Z|30 ?0=8> :1 =:?,?4:9 8,D A,=Dg 1:= 0C,8;70X .:8;0?4?:=> 8,D ?,60 ?@=9> ?: 14C =0?,47 ;0?=:7 ;=4.0>Z 49 -4//492 1:= .:9?=,.?> ,..:=/492 ?: ?30 >4E0 :1 ?30 .:9?=,.? >@8X ,77:.,?0 0<@,7 ,8:@9?> :1 ?30 .:9?=,.? >@8 ?: 0,.3 ;,=?D := ,77:.,?0 ,8:@9?> ?3,? .:==0>;:9/ {;0.414.,77DX ?30 jlll ,77020/ ?3,? ?30 .:8;,940> 3,/ 14=>? ,==,920/ ?: =,4>0 ;0?=:7 ?: ?30 >4E0 :1 0,.3 .:8;,9D 49A:7A0/ 49 ?30 ,2=00809?Z ;=4.0> -D ?070;3:9492 :90 ,9:?30= ,9/ ,2=00492 :9 ?30 ,8:@9? ,9/ ?48492 :1 ?30 ;=4.0 =4>0X ,9/ 3,/ ?309 .:9?,.?0/ ?30 49/4A4/@,7 ;0?=:7 1477492 >?,?4:9> 49 ?30 ,=0, ?: ,>6 ?308 ?: 48;70809? ?30 =4>0Z|30 l:884>>4:9 1@=?30= ,77020/ ?3,? B309 :90 :1 ?30 ;,=?40> ?: ?30 ,==,920809? -0.,80 ,B,=0 ?3,? , ;0?=:7 >?,?4:9 X|yy-+v.r ,r{qr*v{t s|* syn,*||s n{q pn* }n*x +-*snpv{t p|{,*np,+ v{ Z{tyn{q n{q hp|,yn{q 3,/ 9:? =,4>0/ 4?> ;=4.0 49 ,..:=/,9.0 B4?3 ?30 ,==,920809?X 1@=?30= .,77> B0=0 8,/0 ?: ?=D ?: 3,A0 ?30 >?,?4:9 =,4>0 4?> ;=4.0Z o=:8 ^\\\ ?: ^\\^X ?34=?009 =::1492 .:9?=,.?:=> .:77@/0/ 49 -4//492 1:= 17,? =::1 C_ /--1~ eYV T`fced W`f_U eYRe eYV aRceZVd Z_ bfVdeZ`_ hVcV XfZ]ej `W ScVRTYZ_X ,9/ .,= ;,=6 >@=1,.492 .:9?=,.?> 49 n927,9/ ,9/ {.:?7,9/Z ?30 |=,/0 y=,.?4.0 j.? ]ec`Z o490> :1 , ?:?,7 :1 jR^_Z_ 84774:9 V,;;=:C48,?07D xB90=> =0<@4=492 ?30 >@=1,.492 :1 ?304= =::1> := .,= ;,=6> ?D;4.,77D 49A4?0/ , 9@8-0= qtR]`\ 84774:9W B0=0 48;:>0/ :9 ?30 2@47?D ;,=?40>Z :1 >@4?,-7D <@,74140/ .:9?=,.?:=> ?: >@-84? ?09/0= -4/> 49 :=/0= ?: 09>@=0 .:8;0?4?4:9 -0?B009 .:9?=,.?:=> ,9/ ?30=0-D :-?,49 , .:8;0?4?4A0 ;=4.0Z|30 .:9?=,.?:=> 49 <@0>?4:9 .::;0=,?0/ ,9/ .::=/49,?0/ B4?3 0,.3 :?30= 49 =07,?4:9 ?: ?30 >0??492 WvqT*vttv{t :1 ?09/0= ;=4.0> B4?3 ?30 :-50.? :1 ;=0A09?492X =0>?=4.?492 := /4>?:=?492 .:8;0?4?4:9Z r9 >:80 .,>0> ?30 B499492 .:9?=,.?:= ;,4/ 7:>492 .:9?=,.?:=> .:8;09>,?4:9 1:= baZ |09/0=492 ;=:.0/@=0> ,=0 /0>4290/ ?: ;=:8:?0 .:8;0?4?4:9 -0?B009 ;:?09?4,7 >@;;740=> 9:? -4//492 1:= ?30 .:9?=,.? := 1:= >@-84??492 , -4/ ?3,? ?30D 690B B:@7/ -0 :1 ;=:/@.?> := >0=A4.0>Zk4/Y=422492 49A:7A0> ,9 ,2=00809? -0?B009 .:8;0?4?:=> ,> ?:: 3423 ?: B49 ?30 .:9?=,.?Z ?: B34.3 :1 ?308 B477 >@-84? ?30 B499492 -4/ :9 , .:9?=,.? -0492 70? ?3=:@23 ?30 q,A492 -009 1:@9/ 2@47?D :1 .:77@>4:9X ?30 .:9?=,.?:=> B0=0 1490/ , ?:?,7 :1 ,=:@9/ ?09/0=492 ;=:.0>>eZ G^Z_ 84774:9 V,;;=:C48,?07D qtR__Za 84774:9WZ r9 7490 B4?3 ?30 ;:74.D ?: 24A0 709409? ?=0,?809? ?: ;,=?40> ?3,? 24A0 491:=8,?4:9 B4?3 =02,=/ ?: .,=?07 .,>0>X , 9@8-0= :1 .:9?=,.?:=> B0=0 2=,9?0/ ^aS ?: 1@77 488@94?D 1=:8 ?30>0 ;09,7?40>Z

K `pfgt ugevkqpu H cpf I qh vjg \tgxgpvkqp qh Ntkdgt{ [tfkpcpeg =Ojcrvgt DBC>? egtvckp dkf@tkiikpi cevkxkvkgu? vq vjg gzvgpv vjcv vjg{ tgncvg vq rwdnke dqfkgu? ctg etkokpcn qhhgpeguA

tv tw b`Z y=4.0Y14C492 8,D ,7>: ?,60 ?30 1:=8 :1 ,9 ,2=00809? ?: =0>?=4.? ;=4.0 .:8;0?4?4:9Z bbZ k4/Y=422492 ,2=00809?> @>@,77D 1,77 49?: :90 := 8:=0 :1 ?30 1:77:B492 .,?02:=40> I |34> .,9 49.7@/0X 1:= 0C,8;70X ,9 ,2=00809? ?: ,/30=0 ?: ;@-74>30/ ;=4.0 74>?> := 9:? M k4/ >@;;=0>>4:9fx90 := 8:=0 .:8;0?4?:=> B3: :?30=B4>0 B:@7/ -0 0C;0.?0/ ?: ?: <@:?0 , ;=4.0 B4?3:@? .:9>@7?492 ;:?09?4,7 .:8;0?4?:=>X := 9:? ?: .3,=20 70>> ?3,9 -4/X := B3: 3,> ;=0A4:@>7D 8,/0 , -4/X ,2=00> ?: =01=,49 1=:8 -4//492 := B4?3/=,B> ,9D :?30= ;=4.0 49 ?30 8,=60?Zj9 ,2=00809? 8,D =0>?=4.? ;=4.0 .:8;0?4?4:9 0A09 41 , ;=0A4:@>7D >@-84??0/ -4/ >: ?3,? ?30 /0>429,?0/ B499492 .:8;0?4?:=J> -4/ B477 -0 4? /:0> 9:? 09?4=07D 074849,?0 4?Z ,..0;?0/Z

K `pfgt ugevkqpu H cpf I qh vjg \tgxgpvkqp qh Ntkdgt{ [tfkpcpeg =Ojcrvgt DBC>? egtvckp dkf@tkiikpi cevkxkvkgu? vq vjg gzvgpv vjcv vjg{ tgncvg vq rwdnke dqfkgu? ctg etkokpcn qhhgpeguA

tv tw bn*xr, Vyy|pn,v|{ Xrzr{, pn*,ry v{ ,ur hy|.nx gr}-oyvp bcZ l:8;,940> 8,D ,2=00 ?: >3,=0 8,=60?>X B30?30= :9 ?30 -,>4> :1 20:2=,;34.,7 ,=0,X 8,=60? ?D;0X >4E0 :1 .@>?:80= := 49 >:80 :?30= B,DZ{@.3 ,2=00809?> 8,D =0/@.0 r9 ]ee]X , 9@8-0= :1 .0809? ;=:/@.0=> 49 ?30 {7:A,6 z0;@-74. 09?0=0/ 49?: := 074849,?0 .:8;0?4?4:9 ,9/ 8,D 70,/ ?: .:9>@80=> ;,D492 34230= ;=4.0> ?3,9 41 ,2=00809?> =0>?=4.?492 .:8;0?4?4:9Z ?30=0 B,> 209@490 .:8;0?4?4:9 49 ?30 8,=60?Z |30 ;=:/@.0=> ,2=00/ ?: , =02@7,= 0C.3,920 :1 -,>4. 491:=8,?4:9 ,-:@? ?304= 14=8> :9 8,??0=> >@.3 ,> ;=:/@.?4:9 :@?;@?X .:>?>X 0C;:=? A:7@80>X 49A09?:=40>X ;=:14?>X 9@8-0=> :1 08;7:D00>X ,9/ ,A0=,20 B,20> ,9/ >,7,=40>Z|30D =0;:=?0/ ?34> lu|yr+nyr qv+,*vo-,v|{ |s zntn2v{r+S|,ur* }r*v|qvpny+S n{q

491:=8,?4:9 8:9?37D ?: , .:9>@7?492 14=8X B34.3 .:9>:74/,?0/ ?30 491:=8,?4:9 r g o||x+ v{ lr+,r*{cr/ m|*xh,n,r n{q n, ev,,+o-*tu^{ ,r*{n,v|{ny 81@D5B Vv*}|*, ,9/ /4>?=4-@?0/ ?34> ?: ?30 ;=:/@.0=>Z|30 .:9>@7?492 14=8 ,7>: ;=0;,=0/ /:.@809?> 81@D5B 0>?,-74>3492 , 20:2=,;34.,7 /4A4>4:9 :1 8,=60?> ,8:92 ?30 ;=:/@.0=> ,9/ >@220>?0/ g r r9 ^\\_X ?30 n8;4=0 {?,?0 w0B> l:=;:=,?4:9 r9.ZVn8;4=0WX :1 k@11,7:Xw0B +:=6 , ;=:/@.?4:9 <@:?, 1:= 0,.3 ;=:/@.0=Z|30>0 ;7,9> B0=0 14=>? /4>.@>>0/ -D ?30 49 ?30 }{j B,> ;=:>0.@?0/ 1:= ,77020/7D I .:880=.4,7 /4=0.?:=> :1 ?30 ;=:/@.0=> ,9/ ?309 ,2=00/ ?: -D ?30 8,9,2492 /4=0.?:=>Zj> , =0>@7?X .@>?:80=> B0=0 =0>?=4.?0/ ?: /0,7492 B4?3 :97D :90 ;=:/@.0= ,W ;,=?4.4;,?492 49 , .:9>;4=,.D ?: >@;;=0>> ,9/ 074849,?0 .:8;0?4?4:9 49 ?30 49 ?304= ,=0,Z B3:70>,70 /4>?=4-@?4:9 :1 8,2,E490>X :?30= ;0=4:/4.,7>X ,9/ -::6> 49 *0>?0=9 w0B +:=6 {?,?0 1=:8 s,9@,=D ]eee ?: 84/Y^\\\g ,9/ r9 ]ee`X ?30 j9?4Y8:9:;:7D x114.0 4>>@0/ ,9 :=/0= ;=:34-4?492 ,77 .0809? ;=:/@.0=> 1=:8 092,2492 49 8,=60? ,77:.,?4:9X >0??492 >,70> <@:?,> := 0C.3,92492 491:=8,?4:9 -W 074849,?492 .:8;0?4?4:9 1:= ?30 .:9?=,.? ?: >@;;7D 8,2,E490>X :?30= ;0=4:/4.,7>X ?3,? .:@7/ 1,.474?,?0 ?30 .::=/49,?4:9 :1 >@.3 47702,7 ,2=00809?>Z|30 x114.0 ,7>: ,9/ -::6> ,? y4??>-@=23 r9?0=9,?4:9,7 j4=;:=? -0?B009 v,=.3 ]eee ,9/ 84/Y 48;:>0/ 1490> ?:?,7492 ,-:@? }{R\Zc 84774:9 V,;;=:C48,?07D qtRaZa 84774:9W :9 ^\\\Z ?30 ;,=?40> ?: ?30 ,2=00809?>Z

n8;4=0 ,9/ ,9:?30= B3:70>,70 /4>?=4-@?:= ,2=00/ ?: ,77:.,?0 8,=60?> 1:= ?30 B3:70>,70 /4>?=4-@?4:9 :1 8,2,E490>X :?30= ;0=4:/4.,7>X ,9/ -::6> 49 *0>?0=9 w0B _|v{, W|1p|,,+ +:=6 {?,?0Zn8;4=0 ,7>: ,2=00/ ?: =01=,49 1=:8 ?30 B3:70>,70 /4>?=4-@?4:9 :1 8,2,E490>X :?30= ;0=4:/4.,7>X ,9/ -::6> ,? y4??>-@=23 r9?0=9,?4:9,7 j4=;:=? 49 beZ j9 ,2=00809? -0?B009 .:8;0?4?:=> 9:? ?: /0,7 B4?3 :?30= .:8;0?4?:=>X >@;;740=> 0C.3,920 1:= ,9:?30= B3:70>,70 /4>?=4-@?:= ,2=00492 9:? ?: 0C;,9/ 4?> 8,=60? := .@>?:80=> 4> , 5:49? -:D.:??Zz01@>492 ?: /0,7 B4?3 .@>?:80=> @970>> ?30D ,2=00 >3,=0 49 k@11,7:X ?30 3:80 ?0==4?:=D :1 n8;4=0Z ?: ;=4.492 := :?30= ?0=8> >0? -D ?30 14=8> ;,=?4.4;,?492 49 >@.3 ,9 ,2=00809? 8,D -0 ,9?4Y.:8;0?4?4A0Zr1 .:8;0?4?:=> 5:49 ?:20?30= ?: ;=0>>@=0 >@;;740=> := .@>?:80=> n8;4=0 ;70,/0/ 2@47?D ?: ?30 .3,=20> ,9/ B,> 1490/ }{R^\\X\\\ V,-:@? qtR]Zb ?: >?:; /0,7492 B4?3 ,9:?30= .:8;0?4?:=X ?30D 8,D ,7>: -0 092,2492 49 ,9?4Y.:8;0?4?4A0 84774:9WZ .:9/@.?Z

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bdZ j9 ,2=00809? -0?B009 .:8;0?4?:=> ?: 7484? ;=:/@.?4:9 B477 ,78:>? 490A4?,-7D 70,/ ?: ;=4.0 49.=0,>0>Z{@.3 ,9 ,2=00809? 8,D =07,?0 ?: ?30 B,D 49 B34.3 ;=4.0> ,=0 14C0/X := 4? 8,D -0 49?09/0/ ?: /0,7 B4?3 >?=@.?@=,7 :A0=.,;,.4?DZr9 >:80 .,>0>X 4? 8,D -0 74960/ ?: :?30= ,9?4Y.:8;0?4?4A0 ,2=00809?>Z

tx ty bn*xr, Vyy|pn,v|{ Xrzr{, pn*,ry v{ ,ur hy|.nx gr}-oyvp bcZ l:8;,940> 8,D ,2=00 ?: >3,=0 8,=60?>X B30?30= :9 ?30 -,>4> :1 20:2=,;34.,7 ,=0,X 8,=60? ?D;0X >4E0 :1 .@>?:80= := 49 >:80 :?30= B,DZ{@.3 ,2=00809?> 8,D =0/@.0 r9 ]ee]X , 9@8-0= :1 .0809? ;=:/@.0=> 49 ?30 {7:A,6 z0;@-74. 09?0=0/ 49?: := 074849,?0 .:8;0?4?4:9 ,9/ 8,D 70,/ ?: .:9>@80=> ;,D492 34230= ;=4.0> ?3,9 41 ,2=00809?> =0>?=4.?492 .:8;0?4?4:9Z ?30=0 B,> 209@490 .:8;0?4?4:9 49 ?30 8,=60?Z |30 ;=:/@.0=> ,2=00/ ?: , =02@7,= 0C.3,920 :1 -,>4. 491:=8,?4:9 ,-:@? ?304= 14=8> :9 8,??0=> >@.3 ,> ;=:/@.?4:9 :@?;@?X .:>?>X 0C;:=? A:7@80>X 49A09?:=40>X ;=:14?>X 9@8-0=> :1 08;7:D00>X ,9/ ,A0=,20 B,20> ,9/ >,7,=40>Z|30D =0;:=?0/ ?34> lu|yr+nyr qv+,*vo-,v|{ |s zntn2v{r+S|,ur* }r*v|qvpny+S n{q

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tx ty grs-+ny ,| +-}}y1 r{,r*,nv{zr{,+r*.vpr+ v{ V-+,*nyvn Vpp*rqv,n,v|{ |s yn/+pu||y+ v{ ,ur jhV

r9 ^\\`X ?30 jlll 49>?4?@?0/ ;=:.00/492> ,7702492 ?3,? :9 ?3=00 :..,>4:9> ,9 |30 j80=4.,9 k,= j>>:.4,?4:9 VjkjW .:9/@.?> ?30 9,?4:9,7 ,..=0/4?,?4:9 ;=:.0>> 09?0=?,49809? 2=:@;X 49/4A4/@,7 808-0=> :1 ?30 2=:@; ,9/ ,11474,?0/ .:=;:=,?4:9> 1:= 7,B >.3::7> 49 ?30 }{jZ |30 -,= ,/84>>4:9 =@70> 49 8:>? >?,?0> =0<@4=0 ?3,? 09?0=0/ 49?: ,9 ,2=00809?X ,==,920809? := @9/0=>?,9/492 B4?3 :90 ,9:?30= 9:? , ;0=>:9 2=,/@,?0 1=:8 ,9 jkjY,;;=:A0/ 7,B >.3::7 ?: >,?4>1D ?30 702,7 0/@.,?4:9 ?: >@;;7D >0=A4.0> ?: :=2,94>0=> :1 0A09?>Z =0<@4=0809? 1:= ?,6492 ?30 -,= 0C,849,?4:9Z

x90 >;0.414. ,7702,?4:9 =07,?0/ ?: , .:@9?D 1,4= ?: -0 307/ 49 ]eedX B30=0 0C0.@?4A0 |30 jkj ;=:34-4?0/ jkjY,;;=:A0/ 7,B >.3::7> 1=:8 09=:7492 2=,/@,?0> :1 , 7,B

808-0=> :1 ?30 09?0=?,49809? 2=:@; /4=0.?0/ .0=?,49 :?30= 808-0=> 9:? ?: >.3::7 ,..=0/4?0/ -D , >?,?0X -@? 9:? -D ?30 jkjX 49 ;:>?Y2=,/@,?0 ;=:2=,880>Z r g 81@D5B >@;;7D >0=A4.0> ?: ?30 0A09?X @;:9 ?3=0,? :1 >@>;09>4:9 := 0C;@7>4:9 1=:8 ?30 r? ,7>: ;=:34-4?0/ 7,B >.3::7> 1=:8 :110=492 ?=,9>10= .=0/4?> 1:= ,9D .:@=>0 >@..0>>1@77D 81@D5B 2=:@;Zr? B,> ,7>: ,77020/ ?3,? 49 =07,?4:9 ?: >3:B> 49 ^\\^ ,9/ ^\\_X .0=?,49 .:8;70?0/ ,? , 7,B >.3::7 ,..=0/4?0/ -D , >?,?0X -@? 9:? -D ?30 jkjZ g r 2=:@; 0C0.@?4A0> ,==4A0/ ,? ,9 ,2=00809?X ,==,920809? := @9/0=>?,9/492 9:? ?: >@;;7D >0=A4.0> ?: ?3:>0 >3:B>Z C_ .662~ eYV NL >VaRce^V_e `W DfdeZTV |>ID} WZ]VU R T`â]RZ_e RXRZ_de eYV ;<;+ MYV eh` aRceZVd V_eVcVU Z_e` R WZ_R] dVee]V^V_e~ f_UVc hYZTY eYV ;<; cVWcRZ_VU |30 o0/0=,7 l:@=? 49 {D/90D 1:@9/ ?3,? ?30 09?0=?,49809? 2=:@; 3,/ -=0,.30/ Wc`^ RUàeZ_X R_j deR_URcU eYRe YRU eYV afca`dV `c VWWVTe `W UZdTcZ^Z_ReZ_X >Zà:1 ?30 j@>?=,74,9 |=,/0 y=,.?4.0> j.? ,9/ ?30 l:8;0?4?4:9 l:/0 -D ,??08;?492 RXRZ_de _`_*;<; RTTcVUZeVU dTY``]d+ ?: 49/@.0 4?> 808-0=> ?: -:D.:?? ?30 .:@9?D 1,4= 49 ]eedZ

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j{snv* |* Yv+p*vzv{n,|*1 h,n{qn*q+ c]Z j -@>490>> ?3,? 3,> , /:849,9? ;:>4?4:9 49 , 8,=60? .,9 @>0 ?34> ;:>4?4:9 ?: 7484? :?30= 14=8>J ,..0>> ?: := ,-474?D ?: .:8;0?0 49 ?30 8,=60?Z|34> ?D;0 :1 .:9/@.? .,9 c\Z j9 ,2=00809? -0?B009 .:8;,940> :9X 1:= 0C,8;70X ?0.394.,7 := /0>429 >?,9/,=/> 24A0 =4>0 ?: 0.:9:84. 490114.409.D := ?30 :->?=@.?4:9 :1 1=00 ?=,/0Zr9 ,>>0>>492 B30?30= 8,D 3,A0 ?30 ;:>4?4A0 0110.? :1 307;492 ?: =0/@.0 ?30 .:>? := =,4>0 ?30 <@,74?D :1 , := 9:? ?30 .:9/@.? :1 , .:8;,9D ,8:@9?> ?: ,9 ,-@>0 :1 /:849,9.0X .:8;0?4?4:9 ;=:/@.? := >0=A4.0Zr? 8,D ,7>: ;=:8:?0 ?0.394.,7 := 0.:9:84. 0114.409.D -D =0/@.492 =02@7,?:=> @>@,77D 08;7:D , ?B:Y>?,20 ;=:.0>>Zo4=>?X ?30D 0>?,-74>3 B30?30= := 9:? B,>?0 ,9/ .:9>@80=>J >0,=.3 .:>?>Zq:B0A0=X >@.3 ,9 ,2=00809? 8,D ,/A0=>07D ?30 -@>490>> 4> 49/00/ 49 , /:849,9? ;:>4?4:9Z|30D ?309 ,>>0>> B30?30= ?30 -@>490>> ,110.? .:8;0?4?4:9X 49 ;,=?4.@7,= 41 4? 49.7@/0> =0>?=4.?4:9> :9 B3,? ?30 ;,=?40> 8,D 3,> 092,20/ 49 .:9/@.? ?3,? 4> ,-@>4A0 :1 ?3,? ;:>4?4:9Z{@.3 .:9/@.? @>@,77D 1,77> ;=:/@.0Zr? 8,D ,7>: 3,A0 ?30 0110.? :1 7484?492 .:8;0?4?4:9 1=:8 :?30= >:@=.0>X 1:= 49?: :90 := -:?3 :1 ?30 1:77:B492 .,?02:=40> I 0C,8;70 -D =,4>492 09?=D -,==40=> ?: , 8,=60?Zj2=00809?> ?3,? ;=0A09? ?30 ;,=?40> .:9.0=90/ 1=:8 /0A07:;492 ,7?0=9,?4A0 >?,9/,=/> := ;=:/@.?> ?3,? /: 9:? .:8;7D M l:9/@.? B34.3 0C;7:4?> .@>?:80=> := >@;;740=> V1:= 0C,8;70X -D ;=0>>@=492 ?30 :?30= B4?3 ?30 ,2=00/ >?,9/,=/ 8,D ,7>: 3,=8 .:8;0?4?4:9Z ;,=?D 49?: 09?0=492 , .:9?=,.? B4?3 2=:>>7D @91,4= ?0=8> 49 1,A:@= :1 ?30 /:849,9? ;7,D0=Wg :=

M l:9/@.? B34.3 ,8:@9?> ?: 0C.7@>4:9,=D -03,A4:@=X -0.,@>0 4? =08:A0> := B0,609> .:8;0?4?4:9 1=:8 :?30=> 49 ?30 8,=60?X := 0>?,-74>30> := >?=092?309> 09?=D -,==40=>X ?30=0-D =08:A492 := B0,609492 ;:?09?4,7 .:8;0?4?4:9Z

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tz t{ c^Z |30 lxvyjp {?,?0809? 74>?> ?30 1:77:B492 0C,8;70> :1 ,-@>0 :1 , 8,=60? ;:>4?4:9 I 5W-{qyv{t6 T\n+ zr,r* v{+,nyyn,v|{ v{ cr/ br0vp|S jhV MKy=0/,?:=D -03,A4:@= >@.3 ,> >077492 -07:B .:>? 1:= ?30 ;@=;:>0 :1 /=4A492 :@? .:8;0?4?4:9L g n7 y,>: w,?@=,7 p,> l:8;,9D VKnr y,>:LW B,> , =02@7,?0/ 8:9:;:7D B34.3 :;0=,?0/ ?30 7,=20>? 2,> ;4;07490 >D>?08 49 ?30 {,9 s@,9 k,>49 :1 w0B v0C4.: MK{0??492 =0?,47 ;=4.0 84948@8> 1:= ;=:/@.?> := >0=A4.0> B30=0 ?30=0 ,=0 9: =0,/D ,9/ l:7:=,/:Z >@->?4?@?0>Lg ,9/

MKl:9/4?4:9492 ?30 >@;;7D :1 >;0.4140/ ;=:/@.?> := >0=A4.0> ?: ?30 ;@=.3,>0 :1 :?30= r9 ]eeaX ?30 }{ mxs 1470/ , .:8;7,49? 49 }{ m4>?=4.? l:@=? 49 *,>3492?:9X ,7702492 >;0.4140/ ;=:/@.?> := >0=A4.0>L I ,7>: 69:B9 ,> K-@9/7492L := K?40Y49LZ ?3,? n7 y,>: =0<@4=0/ :B90=> :1 2,> B077> ?3,? 3,/ 74??70 .3:4.0 -@? ?: @>0 n7 y,>:J>

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ut uu Yrsv{v{t V{,vTp|z}r,v,v.r X|{q-p,U \r{r*ny e*|uvov,v|{ |* Yr,nvyrq ,> ,9?4Y.:8;0?4?4A0Z|34> B:@7/ 307; ,7>: ?: 09>@=0 ?3,? ,9D .:8;0?4?4:9 7,B ?3,? Yrsv{v,v|{+ 8423? -0 49?=:/@.0/ 49 ?30 1@?@=0 B:@7/ ,/0<@,?07D ,//=0>> ?30 ,>;4=,?4:9> :1 ?30 B4/0= .:88@94?DZ c`Z z02,=/70>> :1 ?30 0C?09? :1 ?30 >.:;0 :1 ,9D 90B .:8;0?4?4:9 7,B 1:= q:92 t:92X >?,603:7/0=> B:@7/ 900/ ?: 3,A0 , .70,= @9/0=>?,9/492 :1 ?30 >;0.414. ?D;0> :1 .:9/@.? \>URQPSG] PR ]4HHGET] + ?3,? B:@7/ -0 .:A0=0/ -D >@.3 , 7,BZk@>490>>0>X 1:= 0C,8;70X 8423? 1007 ?3,? , 0O 4SSGOTKCM BGST PH 7OHRKOIGNGOT/ 7,B ?3,? :97D >0?> :@? , -=:,/ ;=:34-4?4:9 ,2,49>? ,9?4Y.:8;0?4?4A0 .:9/@.? .:@7/ 24A0 =4>0 ?: @9.0=?,49?D ,> ?: 3:B >@.3 , 7,B 8423? ,;;7DZ{@.3 @9.0=?,49?D .:@7/X 49 ?@=9X 70,/ ?: .:9>?=,49?> :9 499:A,?4:9 ,9/ 0C;,9>4:9 49 ?30 7:.,7 0.:9:8D 49 >:80 68? 7>8<=9;: 15 r g .4=.@8>?,9.0>Z x> 45D5B=9>9>7 G85D85B 1 @1BD93E<1B DI@5 ?6 81@D5B 1>D9b3?=@5D9D9F5 3?>4E3D 3?>CD9DED5C 1> 9>6B9>75=5>D ?6 81@D5B g r caZ y=:A4/492 49 , 90B 7,B , >0? :1 /0?,470/ ,9/ 0C;74.4? /01494?4:9> :1 ?30 ?D;0> :1 ,9?4Y D85 3?=@5D9D9?> <1Ga C8?E<4 D85 K@EB@?C5L ?B K56653DL .:8;0?4?4A0 .:9/@.? ?: -0 .:A0=0/ B:@7/ 307; ?: =08:A0 >@.3 @9.0=?,49?DZq:B0A0=X ?6 D85 3?>4E3D 9> AE5CD9?> 25 D1;5> 9>D? 133?E>Do 4? B:@7/ -0 @9=0,74>?4. ?: 0C;0.? ?3,? >@.3 ,9 ,;;=:,.3 .:@7/ .:A0= ,77 .4=.@8>?,9.0> ~B C8?E<4 CE38 3?>4E3D ?> 9DC ?G> 25 B571B454 1C 49 B34.3 ,9?4Y.:8;0?4?4A0 .:9/@.? 8423? :..@=Zo@=?30=8:=0X 41 ?30 702,7 /01494?4:9> CE669395>D 9> 45D5B=9>9>7 D81D 1> 9>6B9>75=5>D B0=0 ?:: ;=0.4>0X 4? 4> 34237D 74607D ?3,? 1=0<@09? 7024>7,?4A0 ,809/809?> B:@7/ -0 81C D1;5> @<135o =0<@4=0/ ?: 8:/41D ?30>0 /01494?4:9> ,> 90B ?D;0> :1 ,9?4Y.:8;0?4?4A0 ;=,.?4.0 -0.,80 ;=0A,709?Zr? >3:@7/ -0 9:?0/ ?3,?X 0A09 B0=0 ,9 0C3,@>?4A0X >;0.414. 74>?492 ,;;=:,.3 ?: -0 ,/:;?0/X /0?,470/ 2@4/07490> B:@7/ -0 48;:=?,9? 49 09>@=492 ?3,? ;=0A,47492 cdZ x90 1@=?30= 48;:=?,9? ;:49? ?: .:9>4/0= B309 >006492 ?: /01490 ,9?4Y.:8;0?4?4A0 ,9/ 90B 8,=60? .:9/4?4:9> .:@7/ -0 ?,609 49?: ,..:@9?Z .:9/@.? 4> ?30 <@0>?4:9 :1 B30?30= .0=?,49 ;=,.?4.0> >3:@7/ -0 .:9>4/0=0/ ?: -0 A4:7,?4:9> :1 .:8;0?4?4:9 7,B rgt ugX ?3,? 4>X B30?30= ?30 A0=D 1,.? :1 092,2492 49 , cbZ |30 ,;;=:,.3 8:>? .:88:97D @>0/ 49 :?30= 5@=4>/4.?4:9> 4> ?: >0? :@? , 2090=,7 .0=?,49 ?D;0 :1 .:9/@.? >3:@7/ .:9>?4?@?0 ,9 491=4920809?Z|30 ,7?0=9,?4A0 4> ?3,?X ;=:34-4?4:9 ,2,49>? ,9?4Y.:8;0?4?4A0 .:9/@.? ,9/ ?: >@;;70809? ?34> B4?3 2@4/07490> ?: .:9>?4?@?0 ,9 491=4920809?X ?30 .:9/@.? 8@>? 9:? :97D -0 >3:B9 ?: 3,A0 ?,609 ,9/ =02@7,= .:8809?,=40>X 49.7@/492 0C,8;70> :1 .,>0> ?3,? 3,A0 -009 49A0>?42,?0/X ;7,.0X -@? 8@>? cnuq -0 >3:B9 ?: 3,A0 ?30 K;@=;:>0L := K0110.?L :1 ;=0A09?492X -:?3 49 7:.,7 ,9/ :A0=>0,> 0.:9:840>Z|30 ,/A,9?,20 :1 ?,6492 ?34> ,;;=:,.3 49 =0>?=4.?492 := /4>?:=?492 .:8;0?4?4:9Z q:92 t:92 B:@7/ -0 ?3,? 4? B:@7/ -0 1,8474,= ?: 8,9D 49 ?30 -@>490>> ,9/ ;=:10>>4:9,7 >0.?:=>X ,9/ B:@7/ ,7>: ,77:B @> ?: ?,60 =010=09.0 ?: 5@=4>;=@/09.0 49 ?34> ,=0, 49 ceZ o:= 0C,8;70X 41 , 9@8-0= :1 .:8;0?492 14=8> .:77@/0 49 14C492 ?30 ;=4.0 1:= ?304= :?30= ,/8494>?=,?4:9>Zj> B4?3 ?30 ,/8494>?=,?4A0 2@4/07490> :9 .:8;0?4?4:9 4>>@0/ ;=:/@.? ,? , .0=?,49 70A07X >3:@7/ ?34> ,@?:8,?4.,77D -0 ,9 :1109.0 @9/0= ?30 7,Bh -D ?30 |070.:88@94.,?4:9> ,9/ k=:,/.,>?492 j@?3:=4?40> 49 q:92 t:92X >@.3 2@4/07490> x= >3:@7/ 4? :97D -0 ,9 :1109.0 41 ?30 .:9/@.? :1 ?30>0 14=8> .:@7/ -0 >3:B9 ?: 3,A0 .:@7/ ,7>: 49/4.,?0 3:B ?30 =02@7,?:=D ,@?3:=4?D ;=:;:>0/ ?: ;0=1:=8 4?> 1@9.?4:9>Z ?30 ;@=;:>0 := 0110.? :1 /4>?:=?492 9:=8,7 8,=60? .:9/4?4:9>hj7?3:@23 ?30 7,??0= *347>? >@.3 2@4/07490> B:@7/ 9:? 49 ?308>07A0> 3,A0 702,7 0110.?X ?30D .:@7/ .7,=41D ,;;=:,.3 8423? 8,60 4? 8:=0 /4114.@7? ?: ;=:A0 ,9?4Y.:8;0?4?4A0 .:9/@.?X 4? .:@7/ ?30 ;=49.4;70> ?3,? B:@7/ 2:A0=9 =02@7,?:=D .:9>4/0=,?4:9> ,9/ /0.4>4:9>X ?30=0-D 3,A0 ?30 ,/A,9?,20> :1 I ;=:A4/492 >:80 .:81:=? ?: >?,603:7/0=>Z M n9>@=492 ?3,? >8,77 -@>490>>0> ?3,? >3,=0 491:=8,?4:9 1:= 7024?48,?0 ;@=;:>0> B:@7/ ccZ *30?30= , 2090=,7 := >;0.414. ,;;=:,.3 ?: /0149492 ,9?4Y.:8;0?4?4A0 .:9/@.? 4> @974607D 1,.0 =02@7,?:=D ,.?4:9 @970>> ?304= .:9/@.? .:@7/ -0 >3:B9 ?: 3,A0 B4/0= ;=010==0/X 4? B:@7/ -0 ;=08,?@=0 ,? ?34> >?,20 ?: ?=D ?: ,9?4.4;,?0 ;=0.4>07D 3:B , 48;74.,?4:9> 1:= ?30 8,=60? ,> , B3:70g ,9/ .:8;0?4?4:9 =02@7,?:= 49 q:92 t:92 8423? /0.4/0 B3,? B:@7/ .:9>?4?@?0 ,9?4Y M y=:A4/492 .:9?49@4?D B4?3 ?30 ?3=@>? :1 ?30 lyzlJ> ;=:;:>,7>X B34.3 08;3,>4>0 ,9 .:8;0?4?4A0 .:9/@.? 49 , ;,=?4.@7,= .,>0Zw:90?3070>>X B0 =0.:294>0 ?3,? >?,603:7/0=> 49.=0809?,7 ,;;=:,.3 ,9/ ?30 900/ ?: ,A:4/ ;@??492 ,9 @9/@7D :90=:@> -@=/09 8,D B4>3 ?: 3,A0 ,9 0,=7D 49/4.,?4:9 :1 ?30 ?D;0> :1 .:9/@.? ?3,? 8423? -0 =02,=/0/ :9 9:=8,7 -@>490>> :;0=,?4:9>Z

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d^Z y=:A4/492 1:= ?:: 8,9D 0C.7@>4:9> := 0C08;?4:9>X ;,=?4.@7,=7D ,? ?30 0,=7D >?,20 :1 68? 7>8<=9;: 25 49?=:/@.492 , 90B .:8;0?4?4:9 7,BX B:@7/ 74607D /47@?0 ?30 0110.?4A090>> :1 >@.3 , -8?E<4 1>I >5G 3?=@5D9D9?> <1G 1<: 24A0 ?30 48;=0>>4:9 ?3,? ?30 p:A0=9809? B,> 9:? B3:7030,=?0/ 5H3C ?B 5H5=@D9?>C 6B?= D85 1@@<931D9?> ?6 49 ,//=0>>492 ?30 ;:?09?4,7 ;=:-708 :1 ,9?4Y.:8;0?4?4A0 .:9/@.? 49 :@= 0.:9:8DZ C?=5 ?B 1<< 1C@53DC ?6 D85 <1Ga 1>4 96 C?a q:B0A0=X ?30=0 8423? B077 -0 .4=.@8>?,9.0> 49 B34.3 0C08;?4:9> .:@7/ -0 5@>?4140/ 9> G81D 39B3E=CD1>35C C8?E<4 CE38 5H5=@D9?>C 1@@?Z

]\ r g d_Z |30 }94?0/ w,?4:9> l:910=09.0 :9 |=,/0 ,9/ m0A07:;809? V}wl|jmW 3,> 9:?0/ 81@D5B d\Z j> |,-70 ] 49 l3,;?0= ^ :1 ?34> /:.@809? >3:B>X 49 :?30= 5@=4>/4.?4:9>X ?30 .:8;0?4?4:9 ?3,? 0C08;?4:9> ?3,? 3,A0 -009 2=,9?0/ 49 A,=4:@> 5@=4>/4.?4:9> 1,77 49?: , 10B 8,5:= 81@D5B g r 7,B ,77:B> 1:= 0C.7@>4:9> := 0C08;?4:9> B30=0 ?30=0 ,=0 ;@-74. ;:74.D := 0.:9:84. .,?02:=40>Zo:= 0C,8;70X 8,9D 5@=4>/4.?4:9> 3,A0 2=,9?0/ 0C08;?4:9> 49 =0>;0.? :1 2=:@9/> 1:= 9:? ,;;7D492 ?30 7,B ?: .0=?,49 >0.?:=> := 49 >;0.414. .,>0>Zo:= 0C,8;70X ,.?4:9> ,480/ ,? -,7,9.492 @90<@,7 0.:9:84. := -,=2,49492 ;:B0=X >@.3 ,> 7,-:@= 49 {492,;:=0X ,2=00809?> ?3,? ,=0 90.0>>,=D 49 :=/0= ?: ,A:4/ , .:9174.? B4?3 ?30 @94:9>J .:770.?4A0 -,=2,49492 ?: 902:?4,?0 B,20 70A07> ,9/ :?30= 08;7:D809? .:9/4?4:9>g .:@9?=DJ> 49?0=9,?4:9,7 :-742,?4:9> ,=0 0C.7@/0/Zr9 ?30 1:77:B492 ;,=,2=,;3>X B0 5:49? ;@=.3,>492 -D {vn>g ,9/ ?30 1:=8,?4:9 :1 1,=80=>J ,9/ 14>30=809J> .::;0=,?4A0>Z .:9>4/0= 3:B ,9/ 49 B3,? .4=.@8>?,9.0> 0C.7@>4:9> ,9/ 0C08;?4:9> 8423? ,;;7D 41 nC08;?4:9> 3,A0 ,7>: -009 2=,9?0/ ?: ,//=0>> 491:=8,?4:9X ?=,9>,.?4:9 .:>? ,9/ , 90B .:8;0?4?4:9 7,B B0=0 ?: -0 49?=:/@.0/ 49 q:92 t:92Z K.:770.?4A0 ,.?4:9L ;=:-708>X >@.3 ,> ?30 .:770.?4:9 ,9/ 0C.3,920 :1 >?,?4>?4.> ,9/ 491:=8,?4:9X ,9/ ;=:10>>4:9,7 =@70> ?3,? 307; 09>@=0 ?30 >@;;7D :1 <@,74140/ ,9/ 0?34.,7 V artny brpun{v+zs|* Z0py-+v|{+ |* Z0rz},v|{+ >0=A4.0>Z

d]Z r9 ?0=8> :1 ;=:.0/@=0X 0C.7@>4:9> := 0C08;?4:9> 1=:8 .:8;0?4?4:9 7,B .:@7/ -0 8,/0 d`Z |30 }wl|jm =0;:=? ,7>: 1:@9/ ?3,? 1:= >:80 >0.?:=> ?3,? 3,/ -009 2=,9?0/ 0C08;?4:9>X 49 , 9@8-0= :1 B,D>X 1:= 0C,8;70 I /0A07:;809?> 49 ?0.39:7:2DX :=2,94>,?4:9,7 80?3:/> ,9/ ,;;740/ 0.:9:84.> >@220>?0/ ?3,? ,7?0=9,?4A0 ;=:Y.:8;0?4?4:9 ,;;=:,.30> ?: ?30>0 >0.?:=> 3,/ -0.:80 10,>4-70Z M y=:A4/492 B4?349 ?30 8,49 -:/D :1 ?30 7,B 1:= .0=?,49 ?D;0> :1 14=8 ?: -0 0C.7@/0/ |30 =0;:=? ?3@> .:9>4/0=0/ 4? @>01@7 ?: ,/:;? .0=?,49 -,>4. ;=49.4;70> ,9/ ;=:.0/@=0> 1=:8 ?30 ,;;74.,?4:9 :1 >:80 := ,77 ,>;0.?> :1 ?30 7,BZo:= 0C,8;70X 14=8> B4?3 49 ?30 2=,9?492 :1 0C08;?4:9>X 9,807D I 10B0= ?3,9 , 24A09 9@8-0= :1 08;7:D00>X := 49 , >;0.4140/ 49/@>?=D .:@7/ 3,A0 ,@?:8,?4. 0C.7@>4:9Z M nC08;?4:9> >3:@7/ -0 2=,9?0/ :9 , 7484?0/Y?480 -,>4> B4?3 ;=:A4>4:9 1:= ;0=4:/4. =0A40Bg M v,6492 ;=:A4>4:9 49 ?30 7,B ?: 08;:B0= ?30 =02@7,?:=D -:/D := , /0>429,?0/ ;@-74. :114.0= ?: 0C08;? :90 := 8:=0 .,?02:=D :1 @9/0=?,6492 1=:8 ?30 7,BZo:= 0C,8;70X M nC08;?4:9> >3:@7/ -0 2=,9?0/ ,1?0= ;@-74. 30,=492> B4?3 ?30 ;,=?4.4;,?4:9 :1 ?30 14=8> 49 , ;,=?4.@7,= 0.:9:84. >0.?:= 8,D >006 ,9 0C08;?4:9 :9 2=:@9/> ?3,? ?30 49?0=0>?0/ ,9/ ,110.?0/ ;,=?40>g @94<@0 .3,=,.?0=4>?4.> :1 ?30 >0.?:= ,=0 >@.3 ?3,? >:80 .:9/@.?X ,7?3:@23 ,9?4Y M |30 0C08;?4:9> >3:@7/ ;7,.0 ,> 10B =0>?=4.?4:9> :9 .:8;0?4?4:9 ,> ;:>>4-70g ,9/ .:8;0?4?4A0 49 9,?@=0X ,.?@,77D 093,9.0> 0.:9:84. 0114.409.D ,9/ .:9>@80= -09014?>Z {@.3 0C08;?4:9> .:@7/ ,7>: ?,60 ?30 1:=8 :1 >@->4/4,=D 7024>7,?4:9 =0<@4=492 ?30 M nC08;?4:9> >3:@7/ -0 2090=4. 49 9,?@=0X =07,?492 ?: ?D;0> :1 0.:9:84. ,.?4A4?D := A0??492 :1 ?30 u024>7,?4A0 l:@9.47Z ,==,920809?X =,?30= ?3,9 -0492 49/@>?=D := >0.?:= >;0.414.Z

M j77:B492 @9/0=?,6492> ?: >006 0C08;?4:9> :9 , .,>0Y-DY.,>0 -,>4> 1=:8 ?30 {:80 0C,8;70> :1 3:B 0C.7@>4:9> ,9/ 0C08;?4:9> ,=0 ?,.670/ 49 >:80 :A0=>0,> =02@7,?:=D ,@?3:=4?DZo:= 0C,8;70X ,9 @9/0=?,6492 8,D >006 ,9 0C08;?4:9 :9 ?30 5@=4>/4.?4:9> ,=0 -=4017D /0>.=4-0/ 49 ?30 1:77:B492 -:CZ 2=:@9/> ?3,? 4?> .:9/@.?X B347>? ,9?4Y.:8;0?4?4A0X ,.?@,77D =0>@7?> 49 , ;@-74. -09014? ?3,? :@?B0423> ?30 3,=8 ?: .:9>@80=>Z

CB }Mrrnkecvkqp qh Oqorgvkvkqp XcyL Qzgorvkqpu cpf Qzegrvkqpu~L `ZO_MP? DBBD

uv uw 4XEMUSKPOS COF 4XGNQTKPOS Xv*p-z+,n{pr+ v{ /uvpu Z0rz},v|{+ zvtu, V}}y1

CB }Mrrnkecvkqp qh Oqorgvkvkqp XcyL Qzgorvkqpu cpf Qzegrvkqpu~L `ZO_MP? DBBD

uv uw 4XEMUSKPOS COF GXGNQTKPOS Z SPNG PVGRSGCS GXCNQMGS hv{tn}|*r4+ X|z}r,v,v|{ Vp,

V-+,*nyvn4+ i*nqr e*np,vpr+ Vp, r9 {492,;:=0X ?30 l:8;0?4?4:9 j.? ^\\` ,77:B> 1:= 0C.7@>4:9 :1 A,=4:@> ?D;0> :1 |30 |=,/0 y=,.?4.0> j.? :1 ]ec` ,77:B> ?30 =02@7,?:=D ,@?3:=4?DX ?30 j@>?=,74,9 @9/0=?,6492 ,9/ ,2=00809? >4847,= ?: ?3:>0 :1 ?30 }tZ |30 j.? ,7>: 0C.7@/0> l:9>@80= ,9/ l:8;0?4?4:9 l:884>>4:9 VjlllWX ?: 0C08;? .:9/@.? 1=:8 ?30 ,2=00809?> := .:9/@.? =07,?492 ?: ,9D K>;0.4140/ ,.?4A4?DL =02@7,?0/ @9/0= ?30 =070A,9? ;=:A4>4:9> :1 ?30 j.?Z|34> 8,D -0 /:90 :9 ,;;74.,?4:9X ;=:A4/0/ ?3,? 7024>7,?4:9X B34.3 49.7@/0> ?30 >@;;7D :1 ;:>?,7 >0=A4.0>X B,>?0B,?0= 8,9,20809? ?30 jlll 4> >,?4>140/ ?3,? , A4:7,?4:9 :1 ?30 7,B B:@7/ =0>@7? 49 , ;@-74. -09014? >0=A4.0>X >.30/@70/ -@> >0=A4.0>X =,47 >0=A4.0> ,9/ .,=2: ?0=849,7 :;0=,?4:9>Z|30 ?3,? B:@7/ :@?B0423 ?30 ;:>>4-70 3,=8 ?3,? 8423? =0>@7? 1=:8 , 70>>09492 :1 j.? ,7>: ,77:B> 1:= -7:.6 0C08;?4:9>X >4847,= ?: ?3:>0 49 ?30 }tZ r g .:8;0?4?4:9Zr9 8,6492 4?> /0.4>4:9X ?30 jlll .:9/@.?> /0?,470/ 49A0>?42,?4:9> 81@D5B 49A:7A492 ?30 ;,=?40> 49 <@0>?4:9X :?30= 49?0=0>?0/ ;,=?40>X ,9/ 0C;0=?> 49 ?30 1407/ 81@D5B g r .:9.0=90/Z daZ |30 1:77:B492 .3,;?0= /0,7> B4?3 3:B , .:8;0?4?4:9 7,B 8423? -0 48;70809?0/X ;,=?4.@7,=7D 49 ?0=8> :1 ?30 =02@7,?:=D >?=@.?@=0 ,9/ :;?4:9> ,A,47,-70Z j{v,rq `v{tq|z X|z}r,v,v|{ Vp,

r9?30}94?0/ t492/:8X .0=?,49 @9/0=?,6492> ,9/ ,2=00809?> .,9 -0 0C.7@/0/ 1=:8 ?30 ,;;74.,?4:9 :1 ;,=? := ,77 :1 ?30 l:8;0?4?4:9 j.? ]eedZ |30>0 49.7@/0X 1:= 0C,8;70X ,9 @9/0=?,6492 09?=@>?0/ B4?3 ?30 :;0=,?4:9 :1 >0=A4.0> :1 2090=,7 0.:9:84. 49?0=0>? B3470 .,==D492 :@? ?30 ;,=?4.@7,= ?,>6> ,>>4290/ ?: ?30 @9/0=?,6492g ,9 ,2=00809? ?3,? 4> 8,/0 49 :=/0= ?: .:8;7D B4?3 , 702,7 =0<@4=0809?g ,9 ,2=00809? ?3,? 4> 900/0/ ?: ,A:4/ , .:9174.? B4?3 ,9 49?0=9,?4:9,7 :-742,?4:9g ,9/ ,9 ,2=00809? 49 ?30 49?0=0>? :1 ;@-74. ;:74.DZ

|30 l:8;0?4?4:9 j.? ]eed ,7>: ;=:A4/0> ?3,? ?30 x114.0 :1 o,4= |=,/0 Vxo|W 8,D 2=,9? ,9 0C08;?4:9 41 ,9 ,2=00809? I

V4W .:9?=4-@?0> ?: 48;=:A492 ;=:/@.?4:9 := /4>?=4-@?4:9 := ;=:8:?492 ?0.394.,7 := 0.:9:84. ;=:2=0>>g

V44W ,77:B> .:9>@80=> , 1,4= >3,=0 :1 ?30 =0>@7?492 -09014?g

V444W /:0> 9:? 48;:>0 :9 ?30 @9/0=?,6492> .:9.0=90/ =0>?=4.?4:9> B34.3 ,=0 9:? 49/4>;09>,-70 ?: ?30 ,??,49809? :1 ?3:>0 :-50.?4A0>g ,9/

V4AW /:0> 9:? ,11:=/ ?30>0 @9/0=?,6492> ?30 ;:>>4-474?D :1 074849,?492 .:8;0?4?4:9 49 =0>;0.? :1 , >@->?,9?4,7 ;,=? :1 ?30 ;=:/@.?> 49 <@0>?4:9Z

r9 ,//4?4:9X ?30 xo| 8,D =0.:8809/ ?: ?30 {0.=0?,=D :1 {?,?0 1:= |=,/0 ,9/ r9/@>?=D ?3,? 30 8,60 ,9 :=/0= 0C08;?492 , ;,=?4.@7,= .,?02:=D :1 ,2=00809? ?3,? 4> 74607D ?: 800? ?30 ,-:A0 .=4?0=4,ZnC08;?4:9> 3,A0 -009 2=,9?0/ ?: ,2=00809?> =07,?0/ ?: ;@-74. ?=,9>;:=? ?4.60?492 >.3080>X ,4=7490 ,774,9.0>X ,9/ .:77,-:=,?4:9 -0?B009 -,96> :9 j|v >0=A4.0>Z

ux uy 4XEMUSKPOS COF GXGNQTKPOS Z SPNG PVGRSGCS GXCNQMGS hv{tn}|*r4+ X|z}r,v,v|{ Vp,

|30 l:8;0?4?4:9 j.? ]eed ,7>: ;=:A4/0> ?3,? ?30 x114.0 :1 o,4= |=,/0 Vxo|W 8,D 2=,9? ,9 0C08;?4:9 41 ,9 ,2=00809? I

V4W .:9?=4-@?0> ?: 48;=:A492 ;=:/@.?4:9 := /4>?=4-@?4:9 := ;=:8:?492 ?0.394.,7 := 0.:9:84. ;=:2=0>>g

V44W ,77:B> .:9>@80=> , 1,4= >3,=0 :1 ?30 =0>@7?492 -09014?g

V444W /:0> 9:? 48;:>0 :9 ?30 @9/0=?,6492> .:9.0=90/ =0>?=4.?4:9> B34.3 ,=0 9:? 49/4>;09>,-70 ?: ?30 ,??,49809? :1 ?3:>0 :-50.?4A0>g ,9/

V4AW /:0> 9:? ,11:=/ ?30>0 @9/0=?,6492> ?30 ;:>>4-474?D :1 074849,?492 .:8;0?4?4:9 49 =0>;0.? :1 , >@->?,9?4,7 ;,=? :1 ?30 ;=:/@.?> 49 <@0>?4:9Z

ux uy L`Ygj]h E =VGRSGCS @GIUMCTPRY 5RCNGWPRLS U]_kcYjae_ Y Lfdg]jajal] Melahfed]ej o Sgjafei deZ o:= 0,>0 :1 =010=09.0X|,-70 ^ -07:B 34237423?> >:80 :1 ?30 8,49 ,>;0.?> :1 ?30 =02@7,?:=D 1=,80B:=6> 49 ?30 =070A,9? 5@=4>/4.?4:9>Z dbZ r1 , 90B .:8;0?4?4:9 7,B B0=0 ?: -0 49?=:/@.0/ 49 q:92 t:92X ,9 ,;;=:;=4,?0 ,@?3:=4?D B:@7/ -0 =0<@4=0/ ?: 091:=.0 ?30 7,B ,9/ ?: 09>@=0 ?3,? ?30 .:88@94?D B,> ,B,=0 :1 4?> =423?> ,9/ :-742,?4:9>Zl@==09?7DX ?30 :97D -:/D B4?349 ?30 p:A0=9809? BCDMG -. 2PNQGTKTKPO @GIUMCTPRY @GIKNGS KO =VGRSGCS 8URKSFKETKPOS >:707D =0>;:9>4-70 1:= .:8;0?4?4:9 4> ?30 l:8;0?4?4:9 y:74.D j/A4>:=D p=:@; VlxvyjpWX @9/0= ?30 o49,9.4,7 {0.=0?,=DZq:B0A0=X ?34> -:/D 3,> 9: >?,?@?:=D =:70 := ;:B0=>X pECDB1<91 r1>141 tEB?@51> -9>71@?B5 />9D54 /-p ,9/ 74??70 49 ?30 B,D :1 /0/4.,?0/ =0>:@=.0> := 1@77Y?480 0C;0=?4>0 ,? 4?> /4>;:>,7Zr9 />9?> z9>74?= 4?> .@==09? 1:=8X lxvyjp 4> ?30=01:=0 9:? 0<@4;;0/ ?: 091:=.0 90B .:8;0?4?4:9 n91:=.0809? j@>?=,74,9 l:8;0?4?4:9 n@=:;0,9 l:8;0?4?4:9 x114.0 :1 o,4= o0/0=,7 |=,/0 7,B>Z ,209.D l:8;0?4?4:9 k@=0,@ @9/0= l:884>>4:9 I l:884>>4:9 :1 |=,/492 Vxo|W l:884>>4:9 ,9/ l:9>@80= ?30 m4=0.?:=,?0 {492,;:=0 Vll{W Vo|lW l:884>>4:9 l:884>>4:90= p090=,7 1:= r h dcZ r9 ?30 ?070.:88@94.,?4:9> ,9/ -=:,/.,>?492 >0.?:=>X .:8;0?4?4:9 4>>@0> ,=0 =02@7,?0/ VjlllW :1 l:8;0?4?4:9 l:8;0?4?4:9 81@D5B -D ?30 |070.:88@94.,?4:9> j@?3:=4?D V|jW ,9/ ?30 k=:,/.,>?492 j@?3:=4?D VkjW VnlmplW 81@D5B h r =0>;0.?4A07DZq:B0A0=X -:?3 ?30>0 ,@?3:=4?40> 3,A0 , B4/0 =,920 :1 49/@>?=D >;0.414. 4>>@0> :?30= ?3,9 .:8;0?4?4:9 @9/0= ?304= ;@=A40BX ,9/ 4? B:@7/ 9:? -0 .:9>4>?09? q0,=492 ,9/ |30 .:@=?> l:8;0?4?4:9 nlmpl ll{ xo| I .4A47 |30 .:@=?> >,9.?4:9492 V.4A47 ,9/ |=4-@9,7 V.4A47 >,9.?4:9> V.4A47 ,9/ .=4849,7 B4?3 ?304= .@==09? =:70> 1:= ?308 49/4A4/@,77D ?: ?,60 :9 , -=:,/0=X .=:>>Y>0.?:= ;:B0= .=4849,7 .,>0>W .,>0>Wg ?30 |30 .:@=?> I .,>0>W .:8;0?4?4:9 B:=67:,/Z .:@=?> V.=4849,7 .=4849,7 ;=:>0.@?4:9>W ;=:>0.@?4:9> ,9/ .:8;,9D ddZ r9 :=/0= ?: 3,A0 , >@..0>>1@7 .:8;0?4?4:9 =02480X 4? B:@7/ -0 48;:=?,9? ?3,? 09:@23 /4><@,7414.,?4:9 :=/0=> >@;;:=? ,9/ =0>:@=.0> B:@7/ -0 ;=:A4/0/ ?: ?30 ,@?3:=4?D >: ?3,? 4? .:@7/ 1@71477 4?>

=02@7,?:=DX ,/A:.,.D ,9/ :?30= 0>>09?4,7 1@9.?4:9>Zr9 ?34> l3,;?0=X B0 7::6 ,? ?3=00 |D;0 :1 >,9.?4:9 r9F9 r9F9< :97Df 1490 :1 r9F9 :1 @; r9F9 8,49 :;?4:9> 1:= ?30 0>?,-74>3809? :1 , =02@7,?:=D 80.3,94>8 1:= ?30 091:=.0809? 1:= .:8;0?4?4:9 ?: jR]\ 84774:9 ;09,7?40> :1 @; ?: ^\ @; ?: ]\S :1 ?: ]\S :1 ,99@,7 rB9=9>1 =07,?0/ :1109.0> 1:= .:8;,940> rB9=9>13:@7/ ?34> -0 49?=:/@.0/X ,> B077 ,> ?30 ;:B0=> ?3,? ?30 rB9=9>1J :1 ?:?,7 ?@=9:A0= 1:= _ D0,=> ?: ?3=00 D0,=> }{R]84774:9 1:= =02@7,?:= >3:@7/ 3,A0Zr94?4,77DX 3:B0A0=X B0 7::6 -=4017D ,? ?30 =02@7,?:=D 1=,80B:=6> 49/4A4/@,7 1490> 48;=4>:9809? 49 ;=0.0/492 rB9=9>1:9 49/4A4/@,7> := :1 @; ?: ,9/ lR]\ -@>490>> D0,= ?0=8 :1 @; ?: a R]\\84774:9 1:= 49 ?30 5@=4>/4.?4:9> /4>.@>>0/ 49 l3,;?0= ^Z jR`\X\\\ 84774:9 1490 VB34.30A0= 4> ?30 D0,=> 1:= .,=?07 .:8;,940>g 2=0,?0=W :1109.0> ;=4>:9 ?0=8 :1 ]\ D0,=>

j;;0,7 := l:8;0?4?4:9 |30 ,;;0,7 n@=:;0,9 l:@=? l:8;0?4?4:9 l:8;0?4?4:9 |30 ,;;0,7 =0A40B .3,9907> |=4-@9,7 V=0A40B> .:@=?> :1 o4=>? r9>?,9.0X j;;0,7 k:,=/ j;;0,7 |=4-@9,7 .:@=?> =02@7,?:=D n@=:;0,9 l:@=? V1@=?30= V1@=?30= ,;;0,7> /0.4>4:9>W ,9/ :1 s@>?4.0 ,;;0,7> ?3=:@23 ?30 ?30 .:@=?> ?3=:@23 ?30 .:@=?>W V,;;0,7>W .:@=?>W

uz u{ L`Ygj]h E =VGRSGCS @GIUMCTPRY 5RCNGWPRLS U]_kcYjae_ Y Lfdg]jajal] Melahfed]ej o Sgjafei deZ o:= 0,>0 :1 =010=09.0X|,-70 ^ -07:B 34237423?> >:80 :1 ?30 8,49 ,>;0.?> :1 ?30 =02@7,?:=D 1=,80B:=6> 49 ?30 =070A,9? 5@=4>/4.?4:9>Z dbZ r1 , 90B .:8;0?4?4:9 7,B B0=0 ?: -0 49?=:/@.0/ 49 q:92 t:92X ,9 ,;;=:;=4,?0 ,@?3:=4?D B:@7/ -0 =0<@4=0/ ?: 091:=.0 ?30 7,B ,9/ ?: 09>@=0 ?3,? ?30 .:88@94?D B,> ,B,=0 :1 4?> =423?> ,9/ :-742,?4:9>Zl@==09?7DX ?30 :97D -:/D B4?349 ?30 p:A0=9809? BCDMG -. 2PNQGTKTKPO @GIUMCTPRY @GIKNGS KO =VGRSGCS 8URKSFKETKPOS >:707D =0>;:9>4-70 1:= .:8;0?4?4:9 4> ?30 l:8;0?4?4:9 y:74.D j/A4>:=D p=:@; VlxvyjpWX @9/0= ?30 o49,9.4,7 {0.=0?,=DZq:B0A0=X ?34> -:/D 3,> 9: >?,?@?:=D =:70 := ;:B0=>X pECDB1<91 r1>141 tEB?@51> -9>71@?B5 />9D54 /-p ,9/ 74??70 49 ?30 B,D :1 /0/4.,?0/ =0>:@=.0> := 1@77Y?480 0C;0=?4>0 ,? 4?> /4>;:>,7Zr9 />9?> z9>74?= 4?> .@==09? 1:=8X lxvyjp 4> ?30=01:=0 9:? 0<@4;;0/ ?: 091:=.0 90B .:8;0?4?4:9 n91:=.0809? j@>?=,74,9 l:8;0?4?4:9 n@=:;0,9 l:8;0?4?4:9 x114.0 :1 o,4= o0/0=,7 |=,/0 7,B>Z ,209.D l:8;0?4?4:9 k@=0,@ @9/0= l:884>>4:9 I l:884>>4:9 :1 |=,/492 Vxo|W l:884>>4:9 ,9/ l:9>@80= ?30 m4=0.?:=,?0 {492,;:=0 Vll{W Vo|lW l:884>>4:9 l:884>>4:90= p090=,7 1:= r h dcZ r9 ?30 ?070.:88@94.,?4:9> ,9/ -=:,/.,>?492 >0.?:=>X .:8;0?4?4:9 4>>@0> ,=0 =02@7,?0/ VjlllW :1 l:8;0?4?4:9 l:8;0?4?4:9 81@D5B -D ?30 |070.:88@94.,?4:9> j@?3:=4?D V|jW ,9/ ?30 k=:,/.,>?492 j@?3:=4?D VkjW VnlmplW 81@D5B h r =0>;0.?4A07DZq:B0A0=X -:?3 ?30>0 ,@?3:=4?40> 3,A0 , B4/0 =,920 :1 49/@>?=D >;0.414. 4>>@0> :?30= ?3,9 .:8;0?4?4:9 @9/0= ?304= ;@=A40BX ,9/ 4? B:@7/ 9:? -0 .:9>4>?09? q0,=492 ,9/ |30 .:@=?> l:8;0?4?4:9 nlmpl ll{ xo| I .4A47 |30 .:@=?> >,9.?4:9492 V.4A47 ,9/ |=4-@9,7 V.4A47 >,9.?4:9> V.4A47 ,9/ .=4849,7 B4?3 ?304= .@==09? =:70> 1:= ?308 49/4A4/@,77D ?: ?,60 :9 , -=:,/0=X .=:>>Y>0.?:= ;:B0= .=4849,7 .,>0>W .,>0>Wg ?30 |30 .:@=?> I .,>0>W .:8;0?4?4:9 B:=67:,/Z .:@=?> V.=4849,7 .=4849,7 ;=:>0.@?4:9>W ;=:>0.@?4:9> ,9/ .:8;,9D ddZ r9 :=/0= ?: 3,A0 , >@..0>>1@7 .:8;0?4?4:9 =02480X 4? B:@7/ -0 48;:=?,9? ?3,? 09:@23 /4><@,7414.,?4:9 :=/0=> >@;;:=? ,9/ =0>:@=.0> B:@7/ -0 ;=:A4/0/ ?: ?30 ,@?3:=4?D >: ?3,? 4? .:@7/ 1@71477 4?>

uz u{ e\Z j> ?30 ,-:A0 ?,-70 >3:B>X ?30 =02@7,?:=D 80.3,94>8> 1:= 091:=.492 .:8;0?4?4:9 7,B 0 @GIUMCTPRY 5RCNGWPRL HPR 7NQMGNGOTKOI A,=D -0?B009 5@=4>/4.?4:9>Zr9 >:80 ;7,.0>X ?30 ,@?3:=4?D =0>;:9>4-70 1:= 091:=.0809? 2PNQGTKTKPO :CW 3,> B4/0Y=,92492 ;:B0=> 49.7@/492 49A0>?42,?492 ;:?09?4,7 .,>0> :1 ,9?4Y.:8;0?4?4A0 .:9/@.? ,9/ >,9.?4:9492 :1109/0=>Zx?30=> =07D 30,A47D :9 ?30 .:@=?> ?: ,/5@/4.,?0 ,> ?: B30?30= ,9 09?0=;=4>0 3,> >:@23? ?: 349/0= .:8;0?4?4:9 @91,4=7D ,9/ ?: 3,9/ 68? 7>8<=9;: 35 /:B9 ,;;=:;=4,?0 >,9.?4:9>Z{,9.?4:9> ?308>07A0> ,7>: A,=DX B4?3 /4110=09? ,;;=:,.30> 08938 9C D85 =?CD CE9D12<5 ?6 D85 D8B55 @B9>39@1< ?@D9?>C ?: .4A47 ,9/ .=4849,7 =080/40>X ,9/ ?: ?30 ;09,7?40> ?3,? .,9 -0 3,9/0/ /:B9 ?: C5D ?ED 25 ,9/ ?: 49/4A4/@,7>Z D85 5>6?B35=5>D ?6 1>I >5G 3?=@5D9D9?> <1G 6?B w?>7 z?>7o

e]Z w:90?3070>>X ?30=0 ,=0 .0=?,49 .:88:9 10,?@=0> ?3,? ?30 A,=4:@> =02@7,?:=D 80.3,94>8> 3,A0 ?: 09>@=0 0110.?4A0 7,B 091:=.0809?X 1:= 0C,8;70 I 68? 7>8<=9;: 45 M j /0/4.,?0/ =02@7,?:=D ,@?3:=4?D ?3,? 4> 04?30= 49/0;09/09? 1=:8 := 49 >:80 B,D ,571B4<5CC ?6 D85 ?@D9?> I?E =1I @B565Ba

C8?E<4 D85 B57E<1D?B 25 C5<6bCD1>49>7 ?B r h

=08:A0/ 1=:8 ?30 8,49 -:/D :1 ?30 2:A0=9809? ,9/ ?3,? 3,> ,..0>> ?: >@114.409? 81@D5B =0>:@=.0> ,9/ 0C;0=?4>0g C8?E<4 1 DG?bD95B CDBE3DEB5 25 14?@D54a G85B52I 81@D5B 1 6E<45B D85 CE@5BF9C9?> ?6 h r M j;;=:;=4,?0 ;:B0=> ?: 09,-70 ?30 =02@7,?:=D ,@?3:=4?D ?: 49A0>?42,?0 ;:>>4-70 .,>0> 1 =1>175=5>D 2?1B4 =145 E@ ?6 9>49F94E1@.3 ;:B0=> B:@7/ 49.7@/0 ?30 =423? ?: 1@@?9>D54 6B?= 49665B5>D C53D?BC ?6 D85 3?==E>9DIo /08,9/ ?30 ;=:/@.?4:9 :1 0A4/09.0 ,9/ ?: 09?0= ;=084>0> ,9/ .:9/@.? >0,=.30> VB4?3 ?30 90.0>>,=D ,@?3:=4>,?4:9X @>@,77D 1=:8 ?30 .:@=?>Wg ,9/ d},v|{ d{r 3 V hv{tyr V-,u|*v,1 /v,ue| /r*,|^{.r+,vtn,r n{q M {,9.?4:9>X 04?30= .4A47X .=4849,7 := -:?3X B34.3 ,=0 >@114.409? ?: /0?0= ;0:;70 1=:8 Vqw-qvpn,r ?,6492 ?30 =4>6 :1 092,2492 49 ,9?4Y.:8;0?4?4A0 .:9/@.?Z

e_Z |30 14=>? :;?4:9 4> ?: ,/:;? , 8:/07 ?3,? =0>08-70> ?30 =02@7,?:=D =02480> 49 ?30 e^Z *34.30A0= :1 ?30 =02@7,?:=D 8:/07> q:92 t:92 B0=0 ?: ;@=>@0X 49 ?30 0A09? ?3,? , n@=:;0,9 }94:9X{492,;:=0 ,9/ ?30 }94?0/ t492/:8]]V>00 |,-70 ^ ,-:A0WX ,> B077 90B .:8;0?4?4:9 7,B B0=0 ?: -0 49?=:/@.0/X 4? 4> 74607D ?3,? ?30 >D>?08 B:@7/ =0<@4=0 ,> q:92 t:92J> =02480> 1:= ?070.:88@94.,?4:9> ,9/ -=:,/.,>?492X @9/0= B34.3 ?30 >4847,= 10,?@=0> ?: ;=:A4/0 1:= 0110.?4A0 091:=.0809? :1 >@.3 , 7,BZr9 ?34> =02,=/X |j ,9/ ?30 kj 9:? :97D =0.04A0 ,9/ 49A0>?42,?0 .:8;7,49?> :1 ,9?4Y.:8;0?4?4A0 ?30 ;:B0=> ,9/ 1@9.?4:9> ?3,? 8423? -0 =0<@4=0/ ?: -0 0C0=.4>0/ -D , .:8;0?4?4:9 -03,A4:@=X -@? ,7>: /0.4/0 B30?30= >@.3 -03,A4:@= 3,> 49 1,.? ?,609 ;7,.0X ,9/ 48;:>0 =02@7,?:= ,=0 /4>.@>>0/ 49 l3,;?0= a :1 ?34> /:.@809?Z|30 ;,=,2=,;3> -07:B 7::6 ;09,7?40> ,> ,;;=:;=4,?0Zj.:8;0?4?4:9 ,@?3:=4?D .:@7/ ,.? 49 ?30 >,80 B,DX ,> -:?3 ,? :;?4:9> 1:= ,9 :A0=,77 =02@7,?:=D 1=,80B:=6 1:= 48;70809?492 , .:8;0?4?4:9 7,BZ ?30 091:=.0809? ,209.D ,9/ ,> ?30 -:/D =0>;:9>4-70 1:= /0.4/492 :9 B30?30= ,9?4Y .:8;0?4?4A0 .:9/@.? 3,/ ?,609 ;7,.0Z

e`Z |30=0 ,=0 , 9@8-0= :1 ,=2@809?> 1:= 3,A492 , >49270 =02@7,?:=D -:/D 49A0>?42,?0X /0?0=8490 ?30 :@?.:80 :1 ,9/ 3,9/ /:B9 ;09,7?40> 1:= .,>0> :1 ,9?4Y.:8;0?4?4A0 .:9/@.?Zo:= 0C,8;70 I

M j >48;70 ,9/ >?=0,87490/ 49>?4?@?4:9,7 >?=@.?@=0 4> .:9>4>?09? B4?3 ?30 ;=49.4;70 :1 >8,77 2:A0=9809?g

CC Uv ujqwnf dg pqvgf vjcv kp vjg `W? ekxkn ucpevkqpu oc{ dg korqugf d{ vjg tgiwncvqt? yjgtgcu kh etkokpcn ucpevkqpu ctg vq dg uqwijv? vjg ecug kp swguvkqp iqgu vq vjg eqwtvuA

vr vs e\Z j> ?30 ,-:A0 ?,-70 >3:B>X ?30 =02@7,?:=D 80.3,94>8> 1:= 091:=.492 .:8;0?4?4:9 7,B 0 @GIUMCTPRY 5RCNGWPRL HPR 7NQMGNGOTKOI A,=D -0?B009 5@=4>/4.?4:9>Zr9 >:80 ;7,.0>X ?30 ,@?3:=4?D =0>;:9>4-70 1:= 091:=.0809? 2PNQGTKTKPO :CW 3,> B4/0Y=,92492 ;:B0=> 49.7@/492 49A0>?42,?492 ;:?09?4,7 .,>0> :1 ,9?4Y.:8;0?4?4A0 .:9/@.? ,9/ >,9.?4:9492 :1109/0=>Zx?30=> =07D 30,A47D :9 ?30 .:@=?> ?: ,/5@/4.,?0 ,> ?: B30?30= ,9 09?0=;=4>0 3,> >:@23? ?: 349/0= .:8;0?4?4:9 @91,4=7D ,9/ ?: 3,9/ 68? 7>8<=9;: 35 /:B9 ,;;=:;=4,?0 >,9.?4:9>Z{,9.?4:9> ?308>07A0> ,7>: A,=DX B4?3 /4110=09? ,;;=:,.30> 08938 9C D85 =?CD CE9D12<5 ?6 D85 D8B55 @B9>39@1< ?@D9?>C ?: .4A47 ,9/ .=4849,7 =080/40>X ,9/ ?: ?30 ;09,7?40> ?3,? .,9 -0 3,9/0/ /:B9 ?: C5D ?ED 25 ,9/ ?: 49/4A4/@,7>Z D85 5>6?B35=5>D ?6 1>I >5G 3?=@5D9D9?> <1G 6?B w?>7 z?>7o

C8?E<4 D85 B57E<1D?B 25 C5<6bCD1>49>7 ?B r h

e`Z |30=0 ,=0 , 9@8-0= :1 ,=2@809?> 1:= 3,A492 , >49270 =02@7,?:=D -:/D 49A0>?42,?0X /0?0=8490 ?30 :@?.:80 :1 ,9/ 3,9/ /:B9 ;09,7?40> 1:= .,>0> :1 ,9?4Y.:8;0?4?4A0 .:9/@.?Zo:= 0C,8;70 I

M j >48;70 ,9/ >?=0,87490/ 49>?4?@?4:9,7 >?=@.?@=0 4> .:9>4>?09? B4?3 ?30 ;=49.4;70 :1 >8,77 2:A0=9809?g

CC Uv ujqwnf dg pqvgf vjcv kp vjg `W? ekxkn ucpevkqpu oc{ dg korqugf d{ vjg tgiwncvqt? yjgtgcu kh etkokpcn ucpevkqpu ctg vq dg uqwijv? vjg ecug kp swguvkqp iqgu vq vjg eqwtvuA

vr vs M r? 4> 74607D ?3,? .,>0> .:@7/ -0 /0,7? B4?3 8:=0 <@4.67D -D , >49270 =02@7,?:=D -:/Dg M r? B:@7/ ;=:A4/0 1:= :-50.?4A0 5@/2809? :1 ?30 80=4?> :1 49/4A4/@,7 .,>0> ,? , =08:A0 1=:8 ?30 /,DY?:Y/,D :;0=,?4:9 :1 ?30 =02@7,?:=D ,@?3:=4?Dg M q,A492 >0;,=,?0 -:/40> 092,20/ =0>;0.?4A07D 49 ?30 49A0>?42,?4:9 ,9/ ?30 ,/5@/4.,?4:9 :1 .,>0> :1 ,9?4Y.:8;0?4?4A0 .:9/@.? B:@7/ =0<@4=0 8:=0 =0>:@=.0> V,9/ <@4?0 M r? .:@7/ ;=:A4/0 , .30.6 ,2,49>? :A0=YE0,7:@> =02@7,?4:9 -D ?30 091:=.0809? -:/D ;:>>4-7D ?30 /@;74.,?4:9 :1 >:80 >@;;:=? 1@9.?4:9>W ?3,9 3,A492 , >49270 -:/D V1:= 0C,8;70X ?3=:@23 ?30 >0??492 :1 ,22=0>>4A0 <@,9?4?,?4A0 ?,=20?> 1:= 49A0>?42,?4:9 =0>;:9>4-70 1:= ,77 ,>;0.?> :1 =02@7,?4:9 ,9/ 091:=.0809?g ,9/ ,9/ >,9.?4:9492 :1 ,9?4Y.:8;0?4?4A0 .:9/@.?Wg ,9/

M |30=0 4> 9: 49/4.,?4:9 ?3,? ?30 .:8;0?4?4:9 =02480> 49 ;7,.0 49 ?30 n@=:;0,9 }94:9 M p4A09 ?3,? ?30 p:A0=9809? 4?>071 8,D -0 49A:7A0/ 49 .0=?,49 8,=60?> 1=:8 ?480 ?: ,9/ ?30 }94?0/ t492/:8 V,> B077 ,> ?30 .@==09? ,==,920809?> 49 q:92 t:92 1:= ?480X ;7,.492 ?30 ;:B0= :1 ,/5@/4.,?4:9 :@?>4/0 ?30 ,8-4? :1 ?30 2:A0=9809?Y ?30 -=:,/.,>?492 ,9/ ?070.:88@94.,?4:9> >0.?:=>WX B30=0 ?30 =02@7,?:=D ,@?3:=4?D ,;;:49?0/ =02@7,?:= >3:@7/ 307; =0,>>@=0 ?30 ;@-74. ,9/ ?30 -@>490>> .:88@94?D /0?0=8490> .,>0> ,9/ 3,9/> /:B9 ;09,7?40>X 3,A0 70/ ?: @91,4= ?=0,?809?Z ?3,? , 1,4= 30,=492 B477 -0 24A09 ?: ,77 ;,=?40> ,9/ B4?3:@? 1,A:@=Z

eaZ x9 ?30 :?30= 3,9/X ?30=0 8423? -0 , .:9.0=9 ?3,? ;7,.492 -:?3 0C0.@?4A0 ,9/ <@,>4Y eeZ y7,.492 ?30 =0>;:9>4-474?D 1:= ,/5@/4.,?492 .,>0> :1 >@>;0.?0/ ,9?4Y.:8;0?4?4A0 .:9/@.? 5@/4.4,7 ;:B0=> 49 ?30 3,9/> :1 , >49270 =02@7,?:= B:@7/ 7484? ?30 >.:;0 1:= .30.6> :9 ?30 .:@=?> B:@7/ ,// ?: ?30 B:=67:,/ :1 ?30 s@/4.4,=DX ,9/ ,> 9:?0/ ,-:A0 B:@7/ r h ,9/ -,7,9.0> 49 ?30 48;70809?,?4:9 :1 ,9D 90B 7,BZ|: , 7,=20 0C?09?X ?34> .:9.0=9 =0<@4=0 ,//4?4:9,7 ?480 ,9/ =0>:@=.0> B309 .:8;,=0/ ?: 3,A492 , =02@7,?:= ,>>@80 81@D5B .:@7/ -0 ,77,D0/ -D ;@??492 49 ;7,.0 ,9 ,;;=:;=4,?0 ,;;0,7 80.3,94>8 ?: 09>@=0 ,9 ?30 =:70> :1 -:?3 49A0>?42,?:= ,9/ 5@/20Zq:B0A0=X >0;,=,?492 ?30 091:=.0809? ,9/ 81@D5B h r 0110.?4A0 .30.6 :9 ?30 ,@?3:=4?DZj;;0,7 80.3,94>8> ,=0 /4>.@>>0/ 49 ;,=,2=,;3> ,/5@/4.,?4:9 =:70> 8423? -0 >009 -D 8,9D ,> 8:=0 74607D ?: 709/ 4?>071 ?: ?=,9>;,=09.D ]\^ ?: ]\_ -07:BZ ,9/ ,..:@9?,-474?DZ

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]\^Z r9 ,//4?4:9 ?: >0??492 @; , =02@7,?:=D ,@?3:=4?DX 4? B:@7/ -0 90.0>>,=D ?: ;=:A4/0 1:= ]\`Z o:= 0,>0 :1 =010=09.0X ?30 ?3=00 ;=49.4;,7 :;?4:9> :@?7490/ 30=0 1:= ?30 1=,80B:=6 ,;;=:;=4,?0 .3,9907> :1 ,;;0,7 B4?3 =02,=/ ?: ?30 /0.4>4:9> :1 ?30 ,@?3:=4?DZ|:,9 1:= 091:=.492 ,9D 90B .=:>>Y>0.?:= .:8;0?4?4:9 7,B .,9 -0 >@88,=4>0/ ,> 1:77:B> I 0C?09?X ?30 ,.?@,7 ,A09@0 1:= ,;;0,7 B:@7/ /0;09/ :9 ?30 9,?@=0 :1 ?30 ,/5@/4.,?492 -:/DZo:= 0C,8;70X @9/0= ?30 :;?4:9 1:= ?30 .:@=?> ?: ,/5@/4.,?0 :9 ,9/ >,9.?4:9 M x;?4:9 x90I,=02@7,?:=D ,@?3:=4?D B4?3 ?30 ;:B0= ?: 49A0>?42,?0 >@>;0.?0/ .,>0> .,>0> :1 ,9?4Y.:8;0?4?4A0 .:9/@.? Vx;?4:9 |B:WX 4? B:@7/ -0 ,;;=:;=4,?0 1:= ,9D ,;;0,7 :1 ,9?4Y.:8;0?4?4A0 .:9/@.? ,9/ ?: ,/5@/4.,?0 ,9/ 48;:>0 >,9.?4:9> B30=0 4? ?: 2: ?: , 34230= .:@=? ?3,9 ?3,? B34.3 3,/ 8,/0 ?30 :=4249,7 /0.4>4:9X ,> 4> ?30 .:9>4/0=> ?3,? , .,>0 3,> -009 0>?,-74>30/X B4?3 ,;;0,7> ,2,49>? ?30 /0.4>4:9> :1 .,>0 B4?3 .:@=? 5@/2809?> 2090=,77D 49 q:92 t:92Z{4847,= .:9>4/0=,?4:9> ,;;7D ?: >@.3 , -:/D ?: -0 30,=/ -D ?30 .:@=?> := , >;0.4,77D ,;;:49?0/ ,;;0,7 -:,=/g x;?4:9 |3=00X 24A09 ?3,? ?30 >;0.4,74>? ?=4-@9,7 B:@7/ -0 <@,>4Y5@/4.4,7 49 1@9.?4:9Z M x;?4:9 |B:I,=02@7,?:=D ,@?3:=4?D B4?3 091:=.0809? ;:B0=>X B34.3 B:@7/ -=492 >@>;0.?0/ .,>0> :1 ,9?4Y.:8;0?4?4A0 .:9/@.? ?: ?30 .:@=?> 1:= 5@/2809? ,9/ >,9.?4:9X ]\_Z r9 ?30 .,>0 :1 ?30 =02@7,?:=D ,@?3:=4?D 4?>071 3,A492 ?30 ;:B0= ?: ,/5@/4.,?0 ,9/ 3,9/ ,> ,;;=:;=4,?0X B4?3 ,;;0,7> ?: -0 8,/0 ?: 34230= .:@=?>g ,9/ /:B9 >,9.?4:9> Vx;?4:9 x90WX =,?30= ?3,9 ,;;0,7> 2: ?3=:@23 ?30 .:@=?>X :90 :;?4:9 r h B:@7/ -0 ?: >0? @; , /0/4.,?0/ ,;;0,7 -:,=/ ,7:92 ?30 7490> :1 ?30 |070.:88@94.,?4:9> M x;?4:9 |3=00I,=02@7,?:=D ,@?3:=4?D B4?3 091:=.0809? ;:B0=>X B34.3 B:@7/ -=492 81@D5B Vl:8;0?4?4:9 y=:A4>4:9>Wj;;0,7 k:,=/X B34.3 3,9/70> ,;;0,7> ,2,49>? ?30 |jJ> /0.4>4:9> >@>;0.?0/ .,>0> :1 ,9?4Y.:8;0?4?4A0 .:9/@.? ?: , >;0.4,74>? ?=4-@9,7 1:= 5@/2809? 81@D5B h r 49 =07,?4:9 ?: .:8;0?4?4:9 4>>@0> 49 ?30 ?070.:88@94.,?4:9> >0.?:=Z|34> B:@7/ .=0,?0 ,9/ >,9.?4:9X ,> ,;;=:;=4,?0X B4?3 ,;;0,7> ?: -0 8,/0 ?: 34230= .:@=?>Z .:9/4?4:9> ?3,? B:@7/ 307; ?: 09>@=0 .:9>4>?09.D 49 5@/2809?> ,9/ ,77:B ?30 808-0=> :1 ?30 -:,=/ ?: /0A07:; 0C;0=?4>0 49 ?30 ,=0, :1 .:8;0?4?4:9Z ]\aZ o:= 0,.3 :1 ?30>0 :;?4:9>X ?30 =02@7,?:=D ,@?3:=4?D .:@7/ -0 04?30= , K>?,9/Y,7:90L 0C0.@?4A0 -:/D 7460 ?30 |jX := , -:/D ?3,? 3,> ,9 0C0.@?4A0 :A0=>009 -D ,9 ,;;:49?0/ 8,9,20809? -:,=/X 4Z0ZX , ?B:Y?40= >?=@.?@=0X 7460 ?30 kjZ *34.30A0= :;?4:9 8423? -0 ,/:;?0/X ?30 1@77Y?480 >?,11 :1 ?30 =02@7,?:=D ,@?3:=4?D B:@7/ =0<@4=0 ,;;=:;=4,?0 70A07> :1 0C;0=?4>0 49 /4>.4;7490> =07,?0/ ?: .:8;0?4?4:9 8,??0=>X >@.3 ,> 0.:9:84.>X ,..:@9?492 ,9/ ?30 7,BZ

]\bZ |30 ,@?3:=4?D B:@7/ =0<@4=0 >@114.409? =0>:@=.0> ?: ,77:B 4? ?: 091:=.0 ?30 7,B 0110.?4A07DX ,> B077 ,> ?: ;=:A4/0 2@4/,9.0 ,9/ 491:=8,?4:9 ?: -@>490>> ,9/ .:9>@80=> ,7460 :9 3:B ?30 7,B B:@7/ ,;;7D 49 ;=,.?4.0Zr? B:@7/ -0 /4114.@7? ,? ?34> >?,20 ?: .:80 @; B4?3 , 14=8 0>?48,?0 :1 ?30 74607D =0>:@=.0 =0<@4=0809?>X ,> ?34> B:@7/ /0;09/ :9 B34.3 :1 ?30 =02@7,?:=D :;?4:9> B0=0 ?: -0 ;@=>@0/Zw:90?3070>>X 8,6492 =010=09.0 ?: , 9@8-0= :1 7:.,7 ,9/ :A0=>0,> =02@7,?:=D ,@?3:=4?40>X ,9/ :9 ?30 ,>>@8;?4:9 ?3,? ?30 ,@?3:=4?D B:@7/ 3,A0 , 1@77Y?480 0C0.@?4A0 49.7@/492 ;=:10>>4:9,7 702,7X ,..:@9?492 ,9/ 0.:9:84. 0C;0=?4>0X 4? 8,D =0<@4=0 ,9 ,99@,7 -@/20? 49 ?30 =,920 :1 Rb\ 84774:9 ?: Rd\ 84774:9Z

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M |30 3,9/7492 :1 .:8;7,49?>X 49.7@/492 ?3:>0 ?3,? ,=0 ?=4A4,7X 1=4A:7:@> := 8,74.4:@>g ]\dZ *347>? ?30 =02@7,?:=D ,@?3:=4?D .,9 ,.? :1 4?> :B9 A:74?4:9X .:8;7,49?> ,=0 :1?09 ,9 M |30 0C?09? :1 ?30 49A0>?42,?4A0 ,9/ 091:=.0809? ;:B0=> ?3,? >3:@7/ -0 2=,9?0/ 48;:=?,9? >:@=.0 :1 491:=8,?4:9 :9 B34.3 4? 8,D ,.?Z *347>? >:80 :A0=>0,> .:8;0?4?4:9 ?: ?30 =02@7,?:=D ,@?3:=4?Dg ,@?3:=4?40> B477 .:9>4/0= ,9:9D8:@> .:8;7,49?>X ?30=0 8,D -0 ;=,.?4.,7 /4114.@7?40> M |30 .:9/@.? :1 49A0>?42,?4:9>X 49.7@/492 ?30 4>>@0 :1 .:914/09?4,74?D ,9/ /4>.7:>@=0 49 /:492 >: B309 1@77 491:=8,?4:9 4> 9:? ,A,47,-70 ,9/ .7,=414.,?4:9 .,99:? -0 >:@23? :1 491:=8,?4:9g 1=:8 ?30 .:8;7,49,9?>Zj..:=/4927DX .:8;7,49,9?> ,=0 2090=,77D 09.:@=,20/ ?: ;=:A4/0 ,> [email protected] 491:=8,?4:9 ,> ;:>>4-70Z M |30 =07,?4:9>34; B4?3 0C4>?492 =02@7,?:=D 1=,80B:=6> ,9/ ?30 .:9.@==09? ,;;74.,?4:9 r i 81@D5B :1 /4110=09? 7,B> ?: =02@7,?0/ 49/@>?=40>g ]n{qyv{t |s i*v.vnyS [*v.|y|-+ |* bnyvpv|-+ X|z}ynv{,+ n{q iu*r+u|yq 81@D5B i r M |30 70A07 ,9/ ?D;0 :1 ;09,7?40> ?3,? >3:@7/ ,;;7DX ,> B077 ,> ?30 900/ 1:= , 709409.D s|* ^{.r+,vtn,v|{ ;=:2=,880g ]\eZ |30 49?=:/@.?4:9 :1 , 90B .:8;0?4?4:9 7,B >3:@7/ 9:? 70,/ ?: 9:=8,7 -@>490>> M *30?30= ?30 ,@?3:=4?D := ?30 .:@=?> >3:@7/ 3,A0 ?30 ;:B0= ?: :=/0= ?3,? ;,=?40> :;0=,?4:9> -0492 @9/@7D .:9>?=,490/ -D .:8;7,49?> ?3,? ,=0 ?=4A4,7X 1=4A:7:@> := 8,/0 /0>4>? 1=:8 ,9?4Y.:8;0?4?4A0 .:9/@.?X ,9/ ?: =0,.3 >0??70809? B4?3 ;,=?40> >@>;0.?0/ 49 -,/ 1,4?3Zo:= ?34> =0,>:9X 4? 8423? -0 ;=@/09? 1:= >@.3 , 7,B ?: >?4;@7,?0 ?3,? :1 ,9?4Y.:8;0?4?4A0 .:9/@.? B4?3:@? =0.:@=>0 ?: 1:=8,7 ,/5@/4.,?4:9g ,9/ :97D ?30 =02@7,?:=D ,@?3:=4?D B:@7/ 3,A0 ?30 ;:B0= ?: 49A0>?42,?0 ;:>>4-70 A4:7,?4:9>Z r9 :?30= B:=/>X B30=0,> ,9D ;,=?D -0740A492 4?>071 ?: 3,A0 -009 ?30 >@-50.? :1 ,9?4Y M |30 ;=:.0/@=0 1:= .4A47 .7,48> 1:= /,8,20> -D ;,=?40> ?3,? 3,A0 >@110=0/ 7:>>0> ,> .:8;0?4?4A0 .:9/@.? 8,D 7:/20 , .:8;7,49? B4?3 ?30 =02@7,?:=D ,@?3:=4?DX ?30 =02@7,?:=D , =0>@7? :1 ,9?4Y.:8;0?4?4A0 .:9/@.?Z ,@?3:=4?D ,7:90 B:@7/ -0 ,-70 ?: /0.4/0 B30?30= 1@=?30= ,.?4:9 >3:@7/ -0 ?,609Z

]]\Z j9D 90B .:8;0?4?4:9 7,B .:@7/ ,7>: >?4;@7,?0 ?30 ?3=0>3:7/ ?3,? B:@7/ 3,A0 ?: -0 80? -01:=0 ?30 =02@7,?:=D ,@?3:=4?D 8423? /0.4/0 ?: 494?4,?0 , 1:=8,7 49A0>?42,?4:9Z o:= 0C,8;70X >@.3 , 7,B .:@7/ ;=:A4/0 ?3,? ?30 =02@7,?:=D ,@?3:=4?D .:@7/ :97D @>0 4?> ;:B0=> :1 49A0>?42,?4:9 41 4? .:9>4/0=0/ ?3,? ?30=0 B0=0 =0,>:9,-70 2=:@9/> 1:= >@>;0.?492 ?3,? ,9 491=4920809? :1 ?30 ,9?4Y.:8;0?4?4:9 7,B 3,/ ?,609 ;7,.0Z

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vx vy 2POFUET PH 7OVGSTKICTKPOS ]]_Z xA0=>0,> .:8;0?4?4:9 7024>7,?4:9 ;=:A4/0> 1:= >4847,= ;:B0=> ?: -0 2=,9?0/ ?: ?30 =02@7,?:=X ,7?3:@23 ?30 0C0=.4>0 :1 ?30>0 ;:B0=> 8,D /0;09/ :9 ?30 2=,9?492 :1 ,9 [|*zny e|/r*+ |s ^{.r+,vtn,v|{ :=/0= := , B,==,9? -D , 5@/4.4,7 :114.0=Zo:= 0C,8;70X 49 l,9,/,X :9.0 ?30 l:8;0?4?4:9 l:884>>4:90= 3,> -02@9 , 1:=8,7 49<@4=D 49?: ;:>>4-70 ,9?4Y.:8;0?4?4A0 .:9/@.?X 30 8,D ,;;7D ?: , 5@/20 1:= ,9 :=/0= ?: =0<@4=0 , ;0=>:9 ?: ;=:A4/0 491:=8,?4:9 @9/0= 68? 7>8<=9;: ,,5 :,?3 := ?: ;=:/@.0 >;0.4140/ /:.@809?>Z|30 l:884>>4:90= 8,D ,7>: ,;;7D ?: , 081D 6?B=1< @?G5BC ?6 9>F5CD971D9?> C8?E<4 1 B57E<1D?BI 5@/20 1:= , B,==,9? ?: 09?0= ;=084>0> ,9/ ?: >0,=.3 1:= ,9/ >04E0 /:.@809?>Z 1ED8?B9DI 81F5 E>45B 1>I >5G 3?=@5D9D9?> <1Go ]]`Z r9 4?> =0;:=? :9 .:8;0?4?4:9 ;:74.DX ?30 lyzl 9:?0/ ?30 A,=4:@> 49A0>?42,?4A0 ;:B0=> ,A,47,-70 ?: ,@?3:=4?40> 49 q:92 t:92 ,9/ .:8;0?4?4:9 =02@7,?:=> :A0=>0,>X ,9/ 68? 7>8<=9;: ,-5 =0.:8809/0/ ?3,? , .:8;0?4?4:9 ,@?3:=4?D 49 q:92 t:92 >3:@7/ 3,A0 ?30 1:=8,7 -8?E<4 619F5CD971D9?>C 2I D85 ;:B0=> :1 49A0>?42,?4:9 I B57E<1D?BI 1ED8?B9DI 25 1 3B9=9>1< ?665>35o M |: =0<@4=0 , ;0=>:9 ?: 24A0 B=4??09 := :=,7 491:=8,?4:9g

M |: =0<@4=0 ?30 ;=:/@.?4:9 :1 /:.@809?> := :?30= =0.:=/> := /,?,g ,9/ ]]]Z |: 09,-70 , =02@7,?:= ?: 091:=.0 ,9D 90B .:8;0?4?4:9 7,B 0110.?4A07DX ?30 ,@?3:=4?D B:@7/ =0<@4=0 49A0>?42,?4A0 ;:B0=> ?: 1,.474?,?0 ,..0>> ?: =070A,9? 491:=8,?4:9X -0 4? M *4?3 , B,==,9? 4>>@0/ -D ?30 .:@=?X ?: 09?0= ,9/ 49>;0.? ;=084>0> ,9/ >04E0 =070A,9? r

i /:.@809?,=D 0A4/09.0Z /4=0.? 1=:8 49/4A4/@,7> .:9.0=90/ := 1=:8 =0.:=/> 60;? -D >@>;0.?0/ :1109/0=>Z 81@D5B *4?3:@? >@.3 ;:B0=>X ,9D 49A0>?42,?4:9 B:@7/ =07D 7,=207D :9 ?30 0C?09? ?: B34.3 81@D5B i r 8,=60? ;7,D0=> A:7@9?,=47D ;=:A4/0 491:=8,?4:9 ?: ?30 ,209.D .3,=20/ B4?3 ?30 ]]aZ {@.3 ;:B0=> ,=0 .:88:97D =02,=/0/ ,> K1:=8,7L 49 ?30 >09>0 ?3,? , ;0=>:9 B3: 49A0>?42,?4:9Z|30 0C;0=409.0 :1 lxvyjp >@220>?> ?3,? ?34> 8,D 9:? -0 ,9 0110.?4A0 1,47> ?: .::;0=,?0 B309 ?30>0 ;:B0=> :1 49A0>?42,?4:9 ,=0 0C0=.4>0/ -D ?30 =02@7,?:=D ,;;=:,.3X ,> 4? 4> 74607D ?3,? ;,=?40> @9/0= 49A0>?42,?4:9 B:@7/ .4?0 .:9.0=9> >@.3 ,> ,@?3:=4?D B477 -0 /0080/ ?: 3,A0 .:884??0/ , .=4849,7 :1109.0X ,9/ 8,D 3,A0 ?: ;0=>:9,7 ;=4A,.D := .:880=.4,7 >09>4?4A4?D ,> 2=:@9/> 1:= 9:? ,77:B492 ,..0>> ?: , 1,.0 , 1490 := 48;=4>:9809? 49 .:9>0<@09.0ZxA0=>0,> 7024>7,?4:9 :1?09 >?4;@7,?0> 1@77 =,920 :1 /,?, ,9/ :?30= =07,?0/ 491:=8,?4:9X ?30=0-D >0A0=07D .:9>?=,49492 ,9D ?3,? 4? 4> ,9 :1109.0 1:= , ;0=>:9 ?: I 49A0>?42,?4A0 ;=:.0>>Z M o,47 ?: .:8;7D B4?3 , =0<@4=0809? 48;:>0/ @9/0= ?30 1:=8,7 ;:B0=> :1 49A0>?42,?4:9 49 ?30 =070A,9? .:8;0?4?4:9 7,Bg ]]^Z r9 ?30 ?070.:88@94.,?4:9> ,9/ -=:,/.,>?492 >0.?:=> 49 q:92 t:92X 49 =07,?4:9 ?: ?30 49A0>?42,?4:9 :1 :1109.0> =07,?0/ ?: .:8;0?4?4:9 V,> B077 ,> ?: :?30= :1109.0>W M r9?09?4:9,77D :->?=@.? ,9 ,@?3:=4>0/ :114.0= .,==D492 :@? ,9 49>;0.?4:9X 04?30= B4?3 ?30 7,B ;=:A4/0> ?30 ,@?3:=4?40> B4?3 ?30 ;:B0=> I := B4?3:@? , B,==,9? ,> ?30 =070A,9? 7,B 8,D >;0.41Dg

M |: =0<@4=0 ?30 >@;;7D :1 491:=8,?4:9 =07,?492 ?: ?30 =070A,9? -@>490>>X =02,=/70>> M r9?09?4:9,77D := =0.670>>7D /0>?=:D := :?30=B4>0 /4>;:>0 :1 := 1,7>41D := .:9.0,7 , :1 B30?30= := 9:? ?34> 8423? -0 >@-50.? ?: , .:914/09?4,74?D ,2=00809? B4?3 , ?34=/ /:.@809? ?3,? 30 := >30 3,> -009 =0<@4=0/ ?: ;=:/@.0 := .,@>0 := ;0=84? 4?> ;,=?Dg /0>?=@.?4:9X /4>;:>,7X 1,7>414.,?4:9 := .:9.0,7809?g :=

M |: =0<@4=0 ?30 ;=:/@.?4:9 :1 /:.@809?> := ,..:@9?>g ,9/ M y=:A4/0 491:=8,?4:9 ?3,? 4> 1,7>0 := 84>70,/492 ;,=?4.@7,=7D 41 30 := >30 69:B>X := 4> =0.670>> ,> ?: B30?30=X 4? 4> 1,7>0 := 84>70,/492X 04?30= ?: ?30 =02@7,?:=D ,@?3:=4?D M |: 09?0= ;=084>0>X 49>;0.? ,9/ .:;D =070A,9? /:.@809?> ,9/ ,..:@9?>X 49 ,..:=/,9.0 := ?: ,9:?30= ;0=>:9 >@.3 ,> ,9 08;7:D00 := 702,7 ,/A4>0=X 69:B492 ?3,? 4? B477 -0 B4?3 ?30 ;=:.0/@=0> >0? /:B9 49 ?30 7,BZ @>0/ 1:= ?30 ;@=;:>0 :1 ;=:A4/492 491:=8,?4:9 ?: ?30 =02@7,?:=D ,@?3:=4?DZ

vz v{ 2POFUET PH 7OVGSTKICTKPOS ]]_Z xA0=>0,> .:8;0?4?4:9 7024>7,?4:9 ;=:A4/0> 1:= >4847,= ;:B0=> ?: -0 2=,9?0/ ?: ?30 =02@7,?:=X ,7?3:@23 ?30 0C0=.4>0 :1 ?30>0 ;:B0=> 8,D /0;09/ :9 ?30 2=,9?492 :1 ,9 [|*zny e|/r*+ |s ^{.r+,vtn,v|{ :=/0= := , B,==,9? -D , 5@/4.4,7 :114.0=Zo:= 0C,8;70X 49 l,9,/,X :9.0 ?30 l:8;0?4?4:9 l:884>>4:90= 3,> -02@9 , 1:=8,7 49<@4=D 49?: ;:>>4-70 ,9?4Y.:8;0?4?4A0 .:9/@.?X 30 8,D ,;;7D ?: , 5@/20 1:= ,9 :=/0= ?: =0<@4=0 , ;0=>:9 ?: ;=:A4/0 491:=8,?4:9 @9/0= 68? 7>8<=9;: ,,5 :,?3 := ?: ;=:/@.0 >;0.4140/ /:.@809?>Z|30 l:884>>4:90= 8,D ,7>: ,;;7D ?: , 081D 6?B=1< @?G5BC ?6 9>F5CD971D9?> C8?E<4 1 B57E<1D?BI 5@/20 1:= , B,==,9? ?: 09?0= ;=084>0> ,9/ ?: >0,=.3 1:= ,9/ >04E0 /:.@809?>Z 1ED8?B9DI 81F5 E>45B 1>I >5G 3?=@5D9D9?> <1Go ]]`Z r9 4?> =0;:=? :9 .:8;0?4?4:9 ;:74.DX ?30 lyzl 9:?0/ ?30 A,=4:@> 49A0>?42,?4A0 ;:B0=> ,A,47,-70 ?: ,@?3:=4?40> 49 q:92 t:92 ,9/ .:8;0?4?4:9 =02@7,?:=> :A0=>0,>X ,9/ 68? 7>8<=9;: ,-5 =0.:8809/0/ ?3,? , .:8;0?4?4:9 ,@?3:=4?D 49 q:92 t:92 >3:@7/ 3,A0 ?30 1:=8,7 -8?E<4 619F5CD971D9?>C 2I D85 ;:B0=> :1 49A0>?42,?4:9 I B57E<1D?BI 1ED8?B9DI 25 1 3B9=9>1< ?665>35o M |: =0<@4=0 , ;0=>:9 ?: 24A0 B=4??09 := :=,7 491:=8,?4:9g

vz v{ X|{svqr{,vnyv,1 n{q Yv+py|+-*r |s ^{s|*zn,v|{ Yv+py|+-*r |s v{s|*zn,v|{ 3 hv{tn}|*r

68? 7>8<=9;: ,.5 {0.?4:9 de :1 ?30 ^\\` l:8;0?4?4:9 j.? :1 {492,;:=0 ;=:A4/0> ?3,? ,77 8,??0=> I w?G =978D 1 3?=@5D9D9?> B57E<1D?BI 1ED8?B9DI 451< G9D8 D85 49C36?B=1D9?> D81D M =07,?492 ?: ?30 -@>490>>X .:880=.4,7 := :114.4,7 ,11,4=> :1 ,9D ;0=>:9g 3?=5C D? 9DC ;>?G<5475 81F9>7 B571B4 D? M B34.3 3,A0 -009 4/09?4140/ ,> .:914/09?4,7g := D85 >554 D? @B?D53D F1B9?EC 31D57?B95C ?6 3?>6945>D91< 9>6?B=1D9?> ?> D85 ?>5 81>4a 1>4 D85 >554 D? M =07,?492 ?: ?30 4/09?4?D :1 ;0=>:9> 1@=94>3492 491:=8,?4:9 ?: ?30 l:8;0?4?4:9 =1;5 1@@B?@B91D5 49C3 ?B45B D? D1;5 6?BG1B4 1> l:884>>4:9 :1 {492,;:=0 Vll{Wg 9>F5CD971D9?> G85> D85 39B3E=CD1>35C C? B5AE9B5o .:8492 ?: ?30 69:B70/20 :1 ?30 ll{ 49 ?30 .:@=>0 :1 ;0=1:=8,9.0 :1 4?> 1@9.?4:9> ,9/ /@?40> >3,77 9:? -0 /4>.7:>0/X @970>> ?34> 4> 90.0>>,=D 1:= ?30 ;0=1:=8,9.0 :1 4?> 1@9.?4:9 := /@?40>X := @970>> /4>.7:>@=0 4> 7,B1@77D =0<@4=0/ := ;0=84??0/ @9/0= ]]bZ |30 49A0>?42,?4:9 ,9/ /0?0.?4:9 :1 491=4920809?> :1 ,9D 90B .:8;0?4?4:9 7,B B:@7/ ?30 j.? := ,9D B=4??09 7,BZ 74607D =07D 49 8,9D .,>0> :9 491:=8,?4:9 1=:8 49/4A4/@,7> B:=6492 B4?3 := .7:>0 ?: ?30 ;,=?40> 092,20/ 49 >@.3 .:9/@.?Z{@.3 49/4A4/@,7>X ,9/ ;:>>4-7D ?304= :B9 q:B0A0=X >0.?4:9 de :1 ?30 j.? >0?> :@? , 9@8-0= :1 0C.0;?4:9> @9/0= B34.3 .:8;,940>X B:@7/ 900/ ?: -0 ,>>@=0/ ?3,?X ,> ?30 >:@=.0 :1 ?30 491:=8,?4:9 ;,>>0/ /4>.7:>@=0 4> ,@?3:=4>0/X 49.7@/492 I

?: ?30 =02@7,?:=X ?30D B:@7/ -0 ;=:?0.?0/ -D ,;;=:;=4,?0 .:914/09?4,74?D ;=:A4>4:9> r i 81@D5B 49 ,9D 90B .:8;0?4?4:9 7,BZy,=?40> ?3,? B0=0 ?30 >@-50.? :1 .:8;7,49?> B:@7/ ,7>: M B30=0 .:9>09? 3,> -009 :-?,490/ 1=:8 ?30 ;0=>:9 ?: B3:8 ?30 491:=8,?4:9 81@D5B -0 74607D ?: 0C;0.? ;=:?0.?4:9 1=:8 ?30 /4>.7:>@=0 :1 491:=8,?4:9 ;=:A4/0/ -D =07,?0>g i r .:8;7,49,9?> ?3,?X 0A09 41 9:? >@->?,9?4,?0/X 8423? -0 /,8,2492 ?: ?304= ;0=>:9,7 M 1:= ?30 ;@=;:>0 :1 , ;=:>0.@?4:9 @9/0= ?30 j.?g =0;@?,?4:9 := -@>490>> :;0=,?4:9>Z *4?3:@? >?=4.?7D :->0=A0/ ;=:A4>4:9> ;=:34-4?492 ?30 /4>.7:>@=0 :1 .:914/09?4,7 491:=8,?4:9 ;=:A4/0/ -D .:8;7,49,9?> ,9/ :?30= ;,=?40>X M 1:= ?30 ;@=;:>0 :1 49A0>?42,?492 , >@>;0.?0/ :1109.0 := 091:=.492 , ;=:A4>4:9 4? 8423? -0 /4114.@7? 1:= , .:8;0?4?4:9 =02@7,?:= ?: 1@9.?4:9 0110.?4A07DZ|30 -:C -07:B @9/0= ?30 j.?g ,9/ -=4017D :@?7490> 3:B ?30 4>>@0> :1 .:914/09?4,74?D ,9/ /4>.7:>@=0 :1 491:=8,?4:9 ,=0 M 1:= ?30 ;@=;:>0 :1 24A492 0110.? ?: ,9D ;=:A4>4:9 :1 ?30 j.?Z ,//=0>>0/ 49 {492,;:=0,9 7,BZ r1 /4>.7:>@=0 4> ?: -0 8,/0 @9/0= ?30 7,>? .,?02:=D >?4;@7,?0/ 49 ?30 ;=0.0/492 ;,=,2=,;3X 4Z0ZX ?: 24A0 0110.? ?: , ;=:A4>4:9 :1 ?30 j.?X ?30 ll{ >3,77 3,A0 =02,=/ ?: ?30 0C?09? ?: B34.3 /4>.7:>@=0 4> 90.0>>,=D 1:= ?30 ;@=;:>0 :1 >@.3 /4>.7:>@=0Z

|30 ll{ 8@>? ,7>: 3,A0 =02,=/ ?: ?30 900/ 1:= 0C.7@/492X >: 1,= ,> 4> ;=,.?4.,-70 I

M 491:=8,?4:9 ?30 /4>.7:>@=0 :1 B34.3 B:@7/X 49 ?30 ll{J :;494:9X -0 .:9?=,=D ?: ?30 ;@-74. 49?0=0>?g

M .:880=.4,7 491:=8,?4:9 ?30 /4>.7:>@=0 :1 B34.3 B:@7/X 49 ?30 ll{J :;494:9X >429414.,9?7D 3,=8 ?30 7024?48,?0 -@>490>> 49?0=0>?> :1 ?30 @9/0=?,6492 ?: B34.3 4? =07,?0>g :=

M 491:=8,?4:9 =07,?492 ?: ?30 ;=4A,?0 ,11,4=> :1 ,9 49/4A4/@,7X ?30 /4>.7:>@=0 :1 B34.3 B:@7/X 49 ?30 ll{J :;494:9X >429414.,9?7D 3,=8 ?3,? 49/4A4/@,7J> 49?0=0>?Z

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|30 ll{ 8@>? ,7>: 3,A0 =02,=/ ?: ?30 900/ 1:= 0C.7@/492X >: 1,= ,> 4> ;=,.?4.,-70 I

M 491:=8,?4:9 ?30 /4>.7:>@=0 :1 B34.3 B:@7/X 49 ?30 ll{J :;494:9X -0 .:9?=,=D ?: ?30 ;@-74. 49?0=0>?g

M .:880=.4,7 491:=8,?4:9 ?30 /4>.7:>@=0 :1 B34.3 B:@7/X 49 ?30 ll{J :;494:9X >429414.,9?7D 3,=8 ?30 7024?48,?0 -@>490>> 49?0=0>?> :1 ?30 @9/0=?,6492 ?: B34.3 4? =07,?0>g :=

M 491:=8,?4:9 =07,?492 ?: ?30 ;=4A,?0 ,11,4=> :1 ,9 49/4A4/@,7X ?30 /4>.7:>@=0 :1 B34.3 B:@7/X 49 ?30 ll{J :;494:9X >429414.,9?7D 3,=8 ?3,? 49/4A4/@,7J> 49?0=0>?Z

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wv ww ]^cZ *30=0 , .:8;0?4?4:9 =02@7,?:= 3,/ 2::/ .,@>0 ?: -0740A0 ?3,? ,9?4Y.:8;0?4?4A0 ]_\Z |30=0 8,D B077 -0 .:9.0=9> ?3,? ,/:;?492 >@.3 ,9 ,;;=:,.3 .:@7/ 70,/ ?: 0C?09>4A0 .:9/@.? 3,/ ?,609 ;7,.0X =,?30= ?3,9 494?4,?0 1:=8,7 5@/4.4,7 ;=:.00/492>X 4? 8423? 74?42,?4:9 -0?B009 ;,=?40> ,..@>492 :90 ,9:?30= :1 ,9?4Y.:8;0?4?4A0 .:9/@.?X ,9/ -0 0<@,77D 0110.?4A0 1:= ?30 =02@7,?:= ?: =0,.3 , >0??70809? B4?3 ?30 ;,=?D @9/0= ?3,? ?34> 8423? -0 @>0/ ,> , ;7:D ?: =0<@4=0 -@>490>> =4A,7> ?: 49.@= 30,AD 702,7 .:>?> 49A0>?42,?4:9Z{@.3 , >0??70809? .:@7/ -0 49 ?30 1:=8 :1 , ;,D809?X := :1 ,9 ,9/ /4>.:@=,20 ?308 1=:8 ;@=>@492 A,74/ -@>490>> :-50.?4A0>Zr9 ;,=?4.@7,=X >8,77 @9/0=?,6492 ?: >?:; ?30 .:9/@.? 49 <@0>?4:9X := -:?3Z -@>490>>0> 8,D -0 .:9.0=90/ ?3,? 7,=20= .:=;:=,?4:9> B:@7/ @>0 ?30 ?3=0,? := 0C0=.4>0 :1 .4A47 ,.?4:9 ?: ;=0A09? ?308 09?0=492 .0=?,49 8,=60?> := ?: .:9>?=,49 ?304= -@>490>> ]^dZ j >0??70809? 8423? 9:? -0 ,;;=:;=4,?0 49 0A0=D .,>0Zr9 :=/0= ?: >3:B ?3,? -=0,.3492 ,.?4A4?40>Z{8,770= 14=8> 8,D ,7>: -0 .:9.0=90/ ,? ?30 ;:?09?4,7 .:>?> 49A:7A0/ 49 .:8;0?4?4:9 7,B B:@7/ -0 =02,=/0/ ,> , >0=4:@> 8,??0=X , =02@7,?:= B:@7/ 900/ ?: /0109/492 ?308>07A0> ,2,49>? >@.3 ,.?4:9 := 49 >006492 ?: ;@=>@0 ?304= :B9 .7,48> 5@/20 .,=01@77D B30?30= ?: ?,60 ;@94?4A0 ,.?4:9 ,2,49>? , ;,=?D >@>;0.?0/ ?: -0 1:= =0/=0>>Z 092,20/ 49 ,9?4Y.:8;0?4?4A0 .:9/@.?X := B30?30= =0,.3492 , >0??70809? B:@7/ -0 , 8:=0 0114.409? ,9/ 0110.?4A0 .:@=>0 :1 ,.?4:9Z|30 =02@7,?:= B:@7/ ,7>: 900/ ?: ?,60 ]_]Z |: ,//=0>> ?34> .:9.0=9X :90 ,;;=:,.3 ,/:;?0/ 49 5@=4>/4.?4:9> :A0=>0,> 4> ?: 7484? 49?: ,..:@9? ?30 49?0=0>? :1 ;,=?40> ?3,? 8423? 3,A0 -009 ,110.?0/ -D ,9?4Y.:8;0?4?4A0 ?30 =423? ?: ;=4A,?0 ,.?4:9 >: ?3,? 4? .:@7/ -0 ;@=>@0/ :97D ,1?0= ?30 =02@7,?:= 3,/ .:9/@.? B309 /0.4/492 B30?30= := 9:? 4? 8423? -0 ,;;=:;=4,?0 ?: =0,.3 , >0??70809?Z 8,/0 , /0.4>4:9 ?3,? ?30 .:9/@.? 49 <@0>?4:9 .:9>?4?@?0> ,9 491=4920809? :1 .:8;0?4?4:9 7,BZ *30=0 ?3,? /0.4>4:9 B,> >@-50.? ?: ,;;0,7X ?30 =423? ?: ;=4A,?0 .4A47 ,.?4:9 .:@7/ :97D -0 0C0=.4>0/ @;:9 0C;4=D :1 ?30 ,;;0,7 ;0=4:/X := @;:9 ?30 @KIJTS PH >RKVCTG 2KVKM 0ETKPO /0?0=849,?4:9 :1 ,9D ,;;0,7 ?3,? .:914=8> ?30 0,=740= 149/492 :1 ?30 .:8;0?4?4:9 =02@7,?:= ?3,? ,9 491=4920809? 3,> :..@==0/Zj?480 7484? 1:= ?,6492 >@.3 ;=4A,?0 r i ,.?4:9> V1:= 0C,8;70X B4?349 ?B: D0,=> :1 ?30 /0.4>4:9 := ?30 /0?0=849,?4:9 :1 ,9D 81@D5B 68? 7>8<=9;: ,45 ,;;0,7 B4?3 =02,=/ ?: ?3,? /0.4>4:9W .:@7/ ,7>: -0 48;:>0/Z 81@D5B i r -8?E<4 1>I >5G 3?=@5D9D9?> <1G 1<7 6B?= ]_^Z r? >3:@7/X 3:B0A0=X -0 9:?0/ ?3,? 0A09 B4?3:@? >@.3 , 7484?X {vn> ,9/ 7,=20 14=8> 1>D9b3?=@5D9D9F5 3?>4E3D 2I 1>?D85B @1BDIo ,7460 ,=0 @974607D ?: 49.@= >429414.,9? 74?42,?4:9 .:>?> ,> , =0>@7? :1 ?=4A4,7X 1=4A:7:@> := 8,74.4:@> .:8;7,49?>Z *4?3:@? ?30 >@;;:=? :1 , 149/492 :1 491=4920809? -D ?30 .:8;0?4?4:9 =02@7,?:= V:= ?30 ?=4-@9,7W 4? B477 49 =0,74?D -0 A0=D /4114.@7? 1:= , ;=4A,?0 68? 7>8<=9;: -+5 ;,=?D ?: 494?4,?0 := >@>?,49 702,7 ,.?4:9> ?3,? =07D 30,A47D :9 ;=:A09 ,9?4Y.:8;0?4?4A0 w?G C8?E<4 1>I >5G 3?=@5D9D9?> <1G 144B5CC .:9/@.? ?: >@..00/Z|30 9,?@=0 :1 .,=?07 ?D;0 -03,A4:@=X B34.3 49A:7A0> .:77@>4:9 D85 3?>35B>C D81D ?EB 2EC9>5CC5Ca 5C@5391<09?492 ;,=?40>X 4> >@.3 ?3,?X B4?3:@? ?30 -09014? :1 1:=8,7 =1I 6135 1> ?>5B?EC <571< 2EB45> 1C 49A0>?42,?4A0 ;:B0=> := 491:=8,?4:9 ;=:A4/0/ -D K49>4/0=>LX 4? 4> :1?09 /4114.@7? 1:= , 1 B5CE.3,=20 ?30 -@=/09 :1 ;=::1 ?3,? B477 -0 =0<@4=0/ 49 ?30 .:@=? ?: 0>?,-74>3 ?3,? ,9?4Y.:8;0?4?4A0 .:9/@.? 3,> ?,609 ;7,.0Z

]^eZ v,9D 7,B> .:9?,49 ;=:A4>4:9 1:= , ;0=>:9 B3: 3,> .:884??0/ ,9 491=4920809? ?: ]__Z r9 =0,74?DX -01:=0 49>?4?@?492 ,9D .4A47 .7,48 1:= /,8,20>X ,9 ,22=40A0/ ;,=?D B477 74607D -0 74,-70 ?: ;,D .:8;09>,?4:9 -D B,D :1 /,8,20> 1:= 149,9.4,7 7:>>0> >@>?,490/ -D 7:/20 , .:8;7,49? B4?3 ?30 .:8;0?4?4:9 =02@7,?:= 49 ?30 14=>? ;7,.0X ,9/ B,4? @9?47 4? ,9D :?30= ;0=>:9 ,> , =0>@7? :1 >@.3 491=4920809?Z|30 lyzl 49 4?> =0;:=? .:9.7@/0/ V:= ?30 ?=4-@9,7W 3,> 8,/0 , 149/492 :1 491=4920809? :1 .:8;0?4?4:9 7,BZv:>? ?=4A4,7X ?3,? =02,=/70>> :1 ?30 :@?.:80 :1 .,>0> :1 ,9?4Y.:8;0?4?4A0 .:9/@.?X ;,=?40> ?3,? 1=4A:7:@> := 8,74.4:@> .:8;7,49?> B477 ?3@> 3,A0 -009 147?0=0/ :@? -D ?30 .:8;0?4?4:9 .:9>4/0=0/ ?3,? ?30D 3,/ -009 ,110.?0/ -D >@.3 .:9/@.? >3:@7/ -0 09?4?70/ ?: ?,60 =02@7,?:= ,? , A0=D 0,=7D >?,20X ,> 9:?0/ 49 ;,=,2=,;3> ]\e ,9/ ]]\ ,-:A0Z .4A47 ,.?4:9 49 ?30 .:@=?> 1:= ?30 =0.:A0=D :1 /,8,20> >@110=0/Z|30 lyzl ,//0/ ?3,? ;=:A09 ,9?4Y.:8;0?4?4A0 .:9/@.? .:@7/ -0 .4?0/ ,> 2=:@9/> 1:= .7,48492 /,8,20>Z

wx wy ]^cZ *30=0 , .:8;0?4?4:9 =02@7,?:= 3,/ 2::/ .,@>0 ?: -0740A0 ?3,? ,9?4Y.:8;0?4?4A0 ]_\Z |30=0 8,D B077 -0 .:9.0=9> ?3,? ,/:;?492 >@.3 ,9 ,;;=:,.3 .:@7/ 70,/ ?: 0C?09>4A0 .:9/@.? 3,/ ?,609 ;7,.0X =,?30= ?3,9 494?4,?0 1:=8,7 5@/4.4,7 ;=:.00/492>X 4? 8423? 74?42,?4:9 -0?B009 ;,=?40> ,..@>492 :90 ,9:?30= :1 ,9?4Y.:8;0?4?4A0 .:9/@.?X ,9/ -0 0<@,77D 0110.?4A0 1:= ?30 =02@7,?:= ?: =0,.3 , >0??70809? B4?3 ?30 ;,=?D @9/0= ?3,? ?34> 8423? -0 @>0/ ,> , ;7:D ?: =0<@4=0 -@>490>> =4A,7> ?: 49.@= 30,AD 702,7 .:>?> 49A0>?42,?4:9Z{@.3 , >0??70809? .:@7/ -0 49 ?30 1:=8 :1 , ;,D809?X := :1 ,9 ,9/ /4>.:@=,20 ?308 1=:8 ;@=>@492 A,74/ -@>490>> :-50.?4A0>Zr9 ;,=?4.@7,=X >8,77 @9/0=?,6492 ?: >?:; ?30 .:9/@.? 49 <@0>?4:9X := -:?3Z -@>490>>0> 8,D -0 .:9.0=90/ ?3,? 7,=20= .:=;:=,?4:9> B:@7/ @>0 ?30 ?3=0,? := 0C0=.4>0 :1 .4A47 ,.?4:9 ?: ;=0A09? ?308 09?0=492 .0=?,49 8,=60?> := ?: .:9>?=,49 ?304= -@>490>> ]^dZ j >0??70809? 8423? 9:? -0 ,;;=:;=4,?0 49 0A0=D .,>0Zr9 :=/0= ?: >3:B ?3,? -=0,.3492 ,.?4A4?40>Z{8,770= 14=8> 8,D ,7>: -0 .:9.0=90/ ,? ?30 ;:?09?4,7 .:>?> 49A:7A0/ 49 .:8;0?4?4:9 7,B B:@7/ -0 =02,=/0/ ,> , >0=4:@> 8,??0=X , =02@7,?:= B:@7/ 900/ ?: /0109/492 ?308>07A0> ,2,49>? >@.3 ,.?4:9 := 49 >006492 ?: ;@=>@0 ?304= :B9 .7,48> 5@/20 .,=01@77D B30?30= ?: ?,60 ;@94?4A0 ,.?4:9 ,2,49>? , ;,=?D >@>;0.?0/ ?: -0 1:= =0/=0>>Z 092,20/ 49 ,9?4Y.:8;0?4?4A0 .:9/@.?X := B30?30= =0,.3492 , >0??70809? B:@7/ -0 , 8:=0 0114.409? ,9/ 0110.?4A0 .:@=>0 :1 ,.?4:9Z|30 =02@7,?:= B:@7/ ,7>: 900/ ?: ?,60 ]_]Z |: ,//=0>> ?34> .:9.0=9X :90 ,;;=:,.3 ,/:;?0/ 49 5@=4>/4.?4:9> :A0=>0,> 4> ?: 7484? 49?: ,..:@9? ?30 49?0=0>? :1 ;,=?40> ?3,? 8423? 3,A0 -009 ,110.?0/ -D ,9?4Y.:8;0?4?4A0 ?30 =423? ?: ;=4A,?0 ,.?4:9 >: ?3,? 4? .:@7/ -0 ;@=>@0/ :97D ,1?0= ?30 =02@7,?:= 3,/ .:9/@.? B309 /0.4/492 B30?30= := 9:? 4? 8423? -0 ,;;=:;=4,?0 ?: =0,.3 , >0??70809?Z 8,/0 , /0.4>4:9 ?3,? ?30 .:9/@.? 49 <@0>?4:9 .:9>?4?@?0> ,9 491=4920809? :1 .:8;0?4?4:9 7,BZ *30=0 ?3,? /0.4>4:9 B,> >@-50.? ?: ,;;0,7X ?30 =423? ?: ;=4A,?0 .4A47 ,.?4:9 .:@7/ :97D -0 0C0=.4>0/ @;:9 0C;4=D :1 ?30 ,;;0,7 ;0=4:/X := @;:9 ?30 @KIJTS PH >RKVCTG 2KVKM 0ETKPO /0?0=849,?4:9 :1 ,9D ,;;0,7 ?3,? .:914=8> ?30 0,=740= 149/492 :1 ?30 .:8;0?4?4:9 =02@7,?:= ?3,? ,9 491=4920809? 3,> :..@==0/Zj?480 7484? 1:= ?,6492 >@.3 ;=4A,?0 r i ,.?4:9> V1:= 0C,8;70X B4?349 ?B: D0,=> :1 ?30 /0.4>4:9 := ?30 /0?0=849,?4:9 :1 ,9D 81@D5B 68? 7>8<=9;: ,45 ,;;0,7 B4?3 =02,=/ ?: ?3,? /0.4>4:9W .:@7/ ,7>: -0 48;:>0/Z 81@D5B i r -8?E<4 1>I >5G 3?=@5D9D9?> <1G 1<7 6B?= ]_^Z r? >3:@7/X 3:B0A0=X -0 9:?0/ ?3,? 0A09 B4?3:@? >@.3 , 7484?X {vn> ,9/ 7,=20 14=8> 1>D9b3?=@5D9D9F5 3?>4E3D 2I 1>?D85B @1BDIo ,7460 ,=0 @974607D ?: 49.@= >429414.,9? 74?42,?4:9 .:>?> ,> , =0>@7? :1 ?=4A4,7X 1=4A:7:@> := 8,74.4:@> .:8;7,49?>Z *4?3:@? ?30 >@;;:=? :1 , 149/492 :1 491=4920809? -D ?30 .:8;0?4?4:9 =02@7,?:= V:= ?30 ?=4-@9,7W 4? B477 49 =0,74?D -0 A0=D /4114.@7? 1:= , ;=4A,?0 68? 7>8<=9;: -+5 ;,=?D ?: 494?4,?0 := >@>?,49 702,7 ,.?4:9> ?3,? =07D 30,A47D :9 ;=:A09 ,9?4Y.:8;0?4?4A0 w?G C8?E<4 1>I >5G 3?=@5D9D9?> <1G 144B5CC .:9/@.? ?: >@..00/Z|30 9,?@=0 :1 .,=?07 ?D;0 -03,A4:@=X B34.3 49A:7A0> .:77@>4:9 D85 3?>35B>C D81D ?EB 2EC9>5CC5Ca 5C@5391<09?492 ;,=?40>X 4> >@.3 ?3,?X B4?3:@? ?30 -09014? :1 1:=8,7 =1I 6135 1> ?>5B?EC <571< 2EB45> 1C 49A0>?42,?4A0 ;:B0=> := 491:=8,?4:9 ;=:A4/0/ -D K49>4/0=>LX 4? 4> :1?09 /4114.@7? 1:= , 1 B5CE.3,=20 ?30 -@=/09 :1 ;=::1 ?3,? B477 -0 =0<@4=0/ 49 ?30 .:@=? ?: 0>?,-74>3 ?3,? ,9?4Y.:8;0?4?4A0 .:9/@.? 3,> ?,609 ;7,.0Z

wx wy ]_`Z r? >3:@7/ -0 9:?0/ ?3,? ,? ?30 494?4,7 >?,20 B30=0 ?30 =02@7,?:=D ,@?3:=4?D 4> :97D 8,6492 491:=8,7 09<@4=40>X 4? 4> 2090=,77D 9:? 90.0>>,=D 1:= , 14=8 B34.3 4> ?30 >@-50.? 0O PVGRSGCS GXCNQMG :1 , .:8;7,49? ?: 092,20 702,7 ,/A4.0 49 ;=0;,=492 4?> =0>;:9>0X ,7?3:@23 4? B:@7/ -0 1=00 ?: /: >: 41 4? >: B4>30>Z|30 14=8 8423? 1007 , 2=0,?0= 900/ ?: 092,20 702,7 r9?30}94?0/ t492/:8X ,7-04? 49 ?30 /4110=09? .:9?0C? :1 ?30 ,7?0=9,?4A0 /4>;@?0 ,/A4.0 41 1:=8,7 ;:B0=> :1 49A0>?42,?4:9 ,=0 >@->0<@09?7D 49A:60/ -D ?30 =02@7,?:=D =0>:7@?4:9 VjmzW 80.3,94>8 @9/0= ?30 l:9>@80= l=0/4? j.? ]ec`X ?30 x114.0 ,@?3:=4?DX -@? ?34> B:@7/ :97D 3,;;09 41X 49 ?30 0D0> :1 ?30 ,@?3:=4?D V9:? ?30 :1 o,4= |=,/0 Vxo|WX B309 =0>;:9/492 ?: ?30 <@0>?4:9 :1 B30?30= .:9>@80=> .:8;7,49,9?WX ?30=0 ,=0 =0,>:9,-70 2=:@9/> 1:= >@>;4.4:9 ,1?0= ?30 0A4/09.0 2,?30=0/ >3:@7/ -0 .3,=20/ , 100 1:= -=492492 , .,>0 ?: ?30 jmzX ;:49?> :@? ?3,? , 100 ?: 1=:8 ?30 491:=8,7 09<@4=D 3,> -009 1@77D ?,609 49?: ,..:@9?Z .:9>@80=> B:@7/ 349/0= ?304= ,..0>> ?: ?30 80.3,94>8 ,9/ B:@7/ 74607D /0?0= ;0:;70 1=:8 @>492 4?Z|30 xo| 9:?0> ?3,? 8,6492 , .:8;7,49? 4> 9:? B4?3:@? .:>? ?: , .:9>@80=X ,9/ ?3,? B347>? >:80 .:9>@80=> 8,D ;@=>@0 1=4A:7:@> := A0C,?4:@> 0MMCYKOIEPOEGROS PH A;4S .:8;7,49?>X ?30>0 .:@7/ -0 >.=0090/ :@? ,? ,9 0,=7D >?,20Z|30 xo|J> A40B 4> ?3,?X :9 -,7,9.0X .3,=2492 , 100 .:@7/ /0?0= , >429414.,9? 9@8-0= :1 .:9>@80=> B4?3 r? 3,> ,7=0,/D -009 9:?0/ 49 ?30 k:C :9 Kk42 ,9/ {8,77L ,1?0= ;,=,2=,;3 `c ?3,? 7024?48,?0 .:9.0=9> 1=:8 >006492 =0/=0>>X ,9/ .:@7/ ,7>: @9/0=8490 .:914/09.0 {vn> 3,A0 74??70 ?: 10,= 1=:8 , .:8;0?4?4:9 7,B ,> 4? 4> =07,?4A07D @9.:88:9 1:= 49 ?30 jmz =02480Z {vn> ?: -0 ?,=20?0/ -D , .:8;0?4?4:9 =02@7,?:=Z {vn> /: 9:? 3,A0 8,=60? ;:B0= ,78:>? -D /01494?4:9Zx9 ?30 .:9?=,=DX {vn> >?,9/ ?: 2,49 ,> ?30 ;:?09?4,7 :1 ?30 -4220= ;7,D0=> ?: ,/:;? ,-@>4A0 := :?30= ,9?4Y.:8;0?4?4A0 ;=,.?4.0 4> .30.60/

-D .:8;0?4?4:9 7,BZ{vn> 8423? 09?0= ,9/ ?=,/0 8:=0 1=007D 49 ?30 A,=4:@> 8,=60?> r i 81@D5B ,> 4? B:@7/ ?309 -0 /4114.@7? 1:= ?30 -4220= ;7,D0=> ?: 48;:>0 ,=?414.4,7 09?=D -,==40=>Z 81@D5B |30D 8423? ,7>: -09014? 1=:8 7:B0= .:>?> :1 49;@?> ,84/>? , 8:=0 .:8;0?4?4A0 i r 09A4=:9809?Z

|30 90B .:8;0?4?4:9 =02@7,?:= 49 q:92 t:92 .:@7/ ;7,D , >?=:92 ,/A:.,.D =:70 ,9/ 70? {vn> 69:B 3:B , .:8;0?4?4:9 7,B 8,D -09014? ?308Z{@-50.? ?: =0>:@=.0>X ?30 .:8;0?4?4:9 =02@7,?:= 8,D ,7>: ;=:A4/0 ,;;=:;=4,?0 ,/A4>:=D >0=A4.0> ?: {vn> >: ,> ?: 307; ?308 -0??0= 800? ,9D .3,770920> ?3,? 8,D ,=4>0 49 ?30 .:8;74,9.0 ;=:.0>>Z

]_aZ r? 3,> -009 >@220>?0/ -D >:80 .:8809?,?:=> ?3,? , .:8;7,49,9? B3:>0 .:8;7,49? ?@=9> :@? ?: -0 @9>@->?,9?4,?0/ >3:@7/ -0 =0<@4=0/ ?: -0,= ?30 702,7 ,9/ ,/8494>?=,?4A0 .:>? 49.@==0/ -D ?30 @9/0=?,6492 ?3,? 4> ?30 >@-50.? :1 ?30 .:8;7,49? 49 /0,7492 B4?3 ,9D 09<@4=40> := 1:=8,7 ;=:.00/492> ?3,? 8,D -0 @9/0=?,609 -D ?30 .:8;0?4?4:9 =02@7,?:=Z *347>? 4? 4> =0,>:9,-70 ?: .:9>4/0= /4110=09? :;?4:9>X 4? >3:@7/ -0 9:?0/ ?3,? >@.3 , =0<@4=0809? 4> 9:? , .:88:9 10,?@=0 49 ?30 :A0=>0,> .:8;0?4?4:9 7,B B0 3,A0 >?@/40/Z

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REPORT ON THE REVIEW OF HONG KONG’S COMPETITION POLICY

Competition Policy Review Committee June 2006

REPORT ON THE REVIEW OF HONG KONG’S COMPETITION POLICY

TABLE OF CONTENTS

Section Pages

1. Introduction 1 - 2

2. Summary of Recommendations 3 – 6

3. Terms of Reference and Membership 7

4. Brief Overview of Situation in Hong Kong 8 – 12

5. Overseas Practice 13 – 17

6. Key Considerations 18 – 36

7. Recommendations 37 – 43

8. Implementation 44 - 45

Attachments

A – Membership of Competition Policy Review Committee

B - List of Submissions Received by the CPRC

C – Review of Complaints to COMPAG from 2001-02 to 2004-05

D – Illustrative Procedural Framework for Investigation of Anti-competitive Conduct

COMPETITION POLICY REVIEW COMMITTEE

REPORT ON THE REVIEW OF HONG KONG’S COMPETITION POLICY

1. Introduction

The Hong Kong Government’s competition policy is set out in the statement issued by the Competition Policy Advisory Group (COMPAG) in May 1998, which describes the objective of the policy as –

“To enhance economic efficiency and free flow of trade, thereby also benefiting consumer welfare. The Government is committed to competition as a means to achieving the said objective, and not as an end in itself.”

2. The Competition Policy Review Committee (CPRC) was appointed by COMPAG in June 2005 to review the effectiveness of Hong Kong’s competition policy and to report to COMPAG on its findings. In his Policy Address in October 2005, the Chief Executive said that the review committee would “draw on international experience and discuss the need to introduce in Hong Kong a comprehensive and cross-sector law on fair competition, as well as its scope and application”.

3. The CPRC has looked at competition policy and law in overseas jurisdictions, as well as the current sector-specific approach in Hong Kong. Whilst formal public consultation on competition policy will be conducted by the Government in due course, for the purpose of gathering initial views, the CPRC has also written to over 300 trade and industry organisations inviting their views on 2

Hong Kong’s competition policy and in response has received submissions from individuals and organisations.

4. This report summarises the CPRC’s deliberations on the future approach to competition in Hong Kong. The report gives a brief overview of the characteristics of the local economy, and describes how competition is regulated in other economies that the CPRC has studied. It then outlines the key considerations of CPRC members when forming their views on a way forward for Hong Kong’s competition policy. Finally, it sets out the CPRC’s recommendations on the introduction of a new law to regulate anti-competitive conduct.

2. Summary of Recommendations

5. The issues considered by the CPRC are set out in detail in section 6 of this report, and the full recommendations of the review committee are in section 7. For ease of reference, the main recommendations are summarised as follows -

A) New Legislation - General

1. New legislation should be introduced to guard against anti-competitive conduct that would have an adverse effect on economic efficiency and free trade in Hong Kong (paragraph 64 below refers).

2. Rather than target individual sectors of the economy, the legislation should apply to all (paragraph 65).

3. Provision should be included in the legislation to allow the Government to grant exemptions to the application of the law in defined circumstances on public policy or economic grounds (paragraph 66).

4. The regulatory authority should have the discretion to disregard inappropriate complaints, so as to guard against the new law being used to stifle legitimate competitive business activities (paragraph 66).

5. The new law would not target market structures, nor seek to regulate “natural” monopolies or mergers and acquisitions (paragraph 67).

B) New Legislation – Broad Provisions

6. The new legislation should cover the following types of anti-competitive conduct –

• Price-fixing • Bid-rigging • Market allocation • Sales and production quotas • Joint boycotts • Unfair or discriminatory standards • Abuse of a dominant market position (paragraph 68).

7. Such conduct should not be an offence per se, but rather, the particular conduct must be proven –

a) to have been carried out with the intent to distort the market; or

b) to have the effect of distorting normal market operation (paragraph 69).

8. There should not be lengthy and detailed descriptions of these types of conduct in the law as such. Appropriate guidelines should be drawn up by the regulatory authority in consultation with relevant stakeholders that would include –

• detailed descriptions and examples of the types of anti-competitive conduct listed in the law;

• an indication as to how intent and effect in relation to market distortion might be assessed; and

• reference to cases dealt with under existing local sector-specific laws and related overseas legislation (paragraph 70).

C) Regulatory Framework

9. A regulatory authority, to be known as the Competition Commission should be established under the new law. The Commission should have a “two-tier” structure, comprising a governing board underpinned by an executive arm that would include staff with relevant expertise (paragraph 71).

10. The Competition Commission should have an advocacy role, and should be tasked with keeping the scope and application of the new law under review (paragraph 72).

11. The Competition Commission should have sufficient powers to allow it to investigate thoroughly any suspected anti-competitive conduct prohibited by the new legislation (paragraph 73).

12. The Government should seriously consider the merits of establishing a Competition Tribunal to hear cases brought by the Competition Commission and to hand down sanctions (paragraph 76).

13. With regard to sanctions, civil penalties should apply in cases where anti- competitive conduct is found to have occurred (paragraph 77).

14. The Competition Commission should be able to apply for an order from the Competition Tribunal (if established) to require an offender to cease and desist from anti-competitive conduct, pending a decision on the case (paragraph 78).

D) Implementation

15. The Government should engage the community with regard to the parameters of the new competition law and regulatory structure before introducing new legislation (paragraph 82).

16. The Government should plan and make available relevant resources for the establishment of a regulatory structure (paragraph 83).

E) Competition Policy Advisory Group (COMPAG)

17. Bearing in mind that the above recommendations, if implemented, would mean that the new regulatory authority would effectively take over the work currently done by COMPAG, there is no need to make recommendations on its future role (paragraph 62)

3. Terms of Reference and Membership

6. The terms of reference of the CPRC are -

To review the existing competition policy and the composition, terms of reference and operation of the Competition Policy Advisory Group (COMPAG).

7. The membership of the review committee is at Attachment A. The CPRC held eight meetings between June 2005 and June 2006. In addition, Members organised a seminar in August 2005, where experts in competition law shared with the review committee information and views on the background to competition policy and law in a number of overseas jurisdictions, and their relevance to the situation in Hong Kong.

4. Brief Overview of Situation in Hong Kong

8. The CPRC recognizes that in considering the future approach to enhancing competition, including the need for a new competition law, it is important to take account of Hong Kong’s own economic characteristics.

Hong Kong’s Economic Environment

9. Hong Kong is a free and open economy, with few restraints to trade in goods and services and foreign direct investment (FDI). It is currently the 11th largest trading entity in the world, and the second most favoured destination for FDI in Asia. There are few entry barriers to most industries, and a high proportion of local registered businesses are Small and Medium-sized Enterprises (SMEs)1. Companies are free to compete in terms of price, including the use of discount and loyalty schemes, and in terms of differentiated goods and services.

10. However, our domestic market is relatively small 2 . Some sectors characterized by significant economy of scale are dominated by a few big companies, with or without a large number of smaller companies at the periphery. These sectors usually involve large fixed asset investment with long payback periods. Large enterprises also have a natural advantage in sectors where an extensive physical network is essential.

11. The domination of certain sectors by a small number of companies is not anti- competitive per se. In certain sectors, this is simply a result of market forces. Nonetheless, in some sectors such domination is combined with other factors,

1 There were almost 300,000 SMEs in Hong Kong in 2005, constituting over 98% of our business establishments and accounting for about 60% of private sector employment. 2 The size of the domestic market can be proxied by nominal GDP. In 2005, Hong Kong’s nominal GDP was $1,382 billion, equivalent to 51% of that of Taiwan or 8% of that of the United Kingdom. 9 with the result that the possibility of anti-competitive behaviour exists. These factors include high market entry barriers, price inelastic demand, limited product differentiation with competition mainly on price, predictable demand and market share, and vertical integration. Nonetheless, even though the market structure might have elements that could allow for anti-competitive conduct, it does not necessarily follow that such conduct is present.

12. Hong Kong has a vibrant market in many goods and services. With regular public campaigns by the Consumer Council, and in parallel with the development of more accountable and transparent Government, the public has developed a keen sense of consumer rights. The rising number of complaints received by the Consumer Council could be seen as an indication of higher expectations from consumers as they become increasingly aware of their rights. In recent years, there has been increasing demand for greater consumer protection and more competition in sectors such as transport and utilities, where there are perceived to be limited opportunities for new market entrants. There have also been specific allegations of a lack of competition or of anti-competitive behaviour in particular sectors, for example, the sale of auto-fuel, supermarkets, port related fees and charges, exhibition services and the supply of fresh pork. Bundling of services across sectors, for example, the inclusion of telecommunications service charges in estate management fees has also raised concerns.

13. The international community recognises Hong Kong’s free and favourable business environment. In a peer review of Hong Kong conducted in 2005, APEC remarked that Hong Kong’s market oriented and sector-specific approach to competition had much merit, whilst noting that there was a need for constant surveillance and evaluation of the situation.

14. Nonetheless, some international organizations have expressed concern that there is little regulation of anti-competitive practices in Hong Kong. The WTO Secretariat’s report on the 2002 Trade Policy Review on Hong Kong expressed the opinion that “the seeming lack of coherent measures to address anti- competitive practices in all but a few sectors could constitute an obstacle to greater competition” – although this view was later balanced by a comment from the Chair of the WTO Trade Policy Review to the effect that it generally appreciated Hong Kong’s efforts to maintain a competitive market. Earlier this year, the IMF welcomed the establishment of a committee to review competition policy in Hong Kong and the possible role of a general competition law.

Recent Developments a) Policy Direction

15. The Chief Executive noted in his Policy Address in October 2005 that “forces capable of cornering the market may emerge in Hong Kong”, adding that he had tasked the CPRC to review the effectiveness of our existing competition policy. He said that the CPRC would consider the need to introduce a comprehensive and cross-sector law, and that rather than intervene in the market, the purpose was: “to actively protect market order and fair competition by preventing manipulative practices”. b) Consultancy Study on the Auto-fuel Retail Sector

16. As noted above, one particular sector in which there has been concern over possible anti-competitive conduct is the auto-fuel retail sector. Recognising such concerns, in June 2005, on behalf of COMPAG, the Economic Development and Labour Bureau (EDLB) engaged a consultancy firm to study behaviour in the 11 auto-fuel retail market in Hong Kong and to report on whether the local oil companies were colluding in the setting of fuel prices at local petrol filling stations.

17. The CPRC has reviewed the consultant’s report (which have been made public on the EDLB website), noting that the key findings were that –

a) the evidence available to the consultant would be unlikely to support a successful prosecution if Hong Kong had competition laws similar to those that apply in other advanced economies;

b) given the inherent characteristics of the local auto-fuel market, however, there is a risk that collusion could occur; and

c) the Government should consider preventive measures aimed at prohibiting cartel behaviour, which could be effected through the passage of a general competition law - should this not be enacted, sector-specific regulation could be considered.

18. In reviewing the consultant’s findings, the CPRC recognized that the lack of any statutory powers to require the production of documents or other information meant that any investigation into the auto-fuel or other markets would rely on the extent to which market players voluntarily provided information to the agency charged with the investigation. In the specific case of the auto-fuel retail sector, whilst the oil companies had provided some information, they had cited commercial sensitivity as grounds for not allowing the consultant access to a full range of data and other sources relating to their operations. Nonetheless, given the information that was made available, the consultant was of the view that it had been able to present an accurate picture of 12 key aspects of the financial operations of the companies, and from this draw firm conclusions regarding the extent of competition in the market.

5. Overseas Practice

Overseas Competition Law and Regulation

19. The CPRC has looked at the concepts and principles of competition law in several overseas economies. In August 2005, the review committee hosted a seminar at which experts on competition policy and legislation in overseas jurisdictions exchanged views and shared experience with the CPRC members.

20. The CPRC has studied the competition laws and regulatory regimes currently in place in the United Kingdom, the USA, Australia, Singapore and Canada. Members have noted the salient features of the different legislative models, as well as the background to their development and implementation. A summary of the broad areas covered by these laws is shown in Table 1 below.

Table 1: Main Areas Covered by Competition Regulatory Regimes

Singapore United Australia USA Canada European Kingdom Union Law Competition Competition Act Trade Sherman Act, 1985 EC Treaty, Act 2004 1998, Enterprise Practices Act Clayton Act and Competition Articles Act 2002 1974 Hart-Scott- Act 81and 82 Rodino Anti- trust Improve- ments Act

Scope Restrictive Restrictive Restrictive Monopolies, Restrictive Restrictive agreements, agreements, agreements, unreasonable agreements, agreements abuse of abuse of abuse of restraint of trade abuse of (Article 81), dominance dominance and dominance, and anti- dominance abuse of and anti- anti- anti- competitive and anti- dominant competitive competitive competitive mergers and competitive market mergers and mergers and mergers and acquisitions mergers and position acquisitions acquisitions acquisitions, acquisitions (Article 82) – unfair trade separate practices provisions apply to mergers

Singapore United Australia USA Canada European Kingdom Union Types of Price-fixing, Price-fixing, Price-fixing, Monopolizing or Price-fixing, Agreements conduct predatory bid-rigging, sales and attempting to predatory and practices covered behaviour resale price production monopolize, pricing, that have the towards restriction, quotas, joint mergers and market object or competitors, market sharing, boycotts, acquisitions, allocation, effect of market limiting or price price-fixing, group restricting or allocation, controlling discrimination bid-rigging boycotts, bid- distorting sales and output, unfair or exclusive rigging , sales competition production discriminatory dealing, resale and quotas, unfair standards price production or discrimin- maintenance quotas atory prohibition of standards acquisition

Other Exemptions Exemptions may Amendments Scope of the law Ensuring Exemptions provis- may be be granted on introduced in tends to be small and may be ions granted on public policy or recent years defined by the medium-sized granted on an public policy economic to protect interpretations enterprises individual or economic grounds small of the courts; the have “an basis or by grounds businesses law provides for equitable block against larger exemptions in opportunity to exemption by players; specific participate in the European exemptions circumstances the economy” Commission may be is one of the granted on law’s main public policy purposes; or economic certain public grounds interest or economic grounds could be used as defence

21. The table indicates that competition laws in other jurisdictions have many common general elements. However, there is no single “mainstream” or “formula” approach to the detailed content of the relevant legislation. Rather, the actual legal and regulatory frameworks adopted in different jurisdictions reflect their specific characteristics, including the size of the economy, market structure and the political and historical context.

22. As with the format of overseas competition laws, the regulatory mechanisms for enforcing these laws vary from place to place. In many jurisdictions, the authority responsible for enforcement has wide-ranging powers including investigating potential cases of anti-competitive conduct and sanctioning offenders. Other places rely heavily on the courts to decide on the extent to which an enterprise has sought to hinder competition unfairly and to hand down appropriate sanctions. Table 2 below highlights some of the main aspects of various regulatory regimes overseas.

Table 2: Competition Regulatory Regimes in Overseas Jurisdictions

Singapore United Australia USA Canada European Kingdom Union Enforce- Singapore Office of Fair Australian Federal Trade Competition European ment Competition Trading (OFT) Competition Commission Bureau under Commission – agency Commission and (FTC) the Directorate (SCC) Consumer Commissioner General for Commission of Competition Competition (ACCC) (ECDGC) Hearing SCC (civil OFT – civil The courts The courts Competition ECDGC and cases); the sanctions (civil and (civil and Tribunal (civil sanction- courts (criminal The courts – criminal criminal cases); the ing by prosecutions) criminal cases) cases) courts (criminal prosecutions and prosecutions) company disqualification orders Type of Civil: fine of up Civil: fines of Civil: fine of Civil: fines Civil: financial Civil only: fines sanction to 10% of up to 10% of up to A$10 Criminal: penalties of up to €20 annual turnover annual turnover million for fines of up to Criminal: up to million or 10% for 3 yrs for up to three companies US$1m for five years’ of total turnover Criminal: fine years Criminal: individuals imprisonment in preceding of up to Criminal: individual and $100m and C$10 business year S$10,000 and prison term of fines of up to for million fine (whichever is one year in up to 5 years for A$40,000 companies; the greater) prison cartel offences prison term of 10 years Appeal or Competition Competition Competition The appeal The appeal European Court review Appeal Board Appeal Tribunal Tribunal courts courts of First Instance, channels (further appeals (further appeals (reviews European Court through the through the ACCC of Justice courts) courts) merger decisions) and the courts (appeals)

Relevance to Hong Kong

23. Several of the overseas experts stressed during the seminar that due to the relatively small size of Hong Kong’s domestic market, a higher market concentration was inevitable in many sectors to achieve economies of scale and effectiveness in operation. For this reason, unlike in many larger domestic economies, tackling incumbent “natural” monopolies might not be a priority for Hong Kong. Furthermore, given that there is perceived to be relatively little large-scale merger and acquisition activity in the local market, it was felt that this aspect of competition law might also be lower on the CPRC agenda than, for example, price-fixing and other types of anti-competitive conduct.

24. In considering the need for a competition law and the possible scope and regulation of such a law, the CPRC has emphasised that the actual situation of Hong Kong should be taken into account when charting the way forward. This notwithstanding, the CPRC agrees that experience of other jurisdictions provides useful pointers. For example, in the USA, anti-competitive behaviour is defined in very general terms, and the courts then take a view on whether such behaviour has in fact taken place in specific cases. The CPRC has considered whether this approach to the legal definition of anti-competitive behaviour would be suitable for Hong Kong’s situation, or whether a clearly defined scope of prohibited conduct would be more consistent with the practice in local law. This issue is discussed more fully in paragraph 44 below.

25. The CPRC has also noted that there are certain features common to all jurisdictions that it has studied, which appear to be indispensable for the effective implementation of competition law, for example –

a) a regulatory authority that is either independent from or in some way removed from the main body of the government and that has access to sufficient resources and expertise;

b) appropriate powers to enable the regulatory authority to investigate possible cases of anti-competitive conduct – typically such powers would include the right to demand the production of evidence and to enter premises and conduct searches (with the necessary authorization, usually from the courts); and

c) sanctions, either civil, criminal or both, which are sufficient to deter people from taking the risk of engaging in anti-competitive conduct.

6. Key Considerations

Overall Policy Framework

26. In considering the future approach to enhancing competition in Hong Kong, the CPRC has concluded that competition is best nurtured and sustained by allowing the free play of market forces. Any new approach, including legislation should serve the policy objective of enhancing economic efficiency and the free flow of trade, thereby also benefiting consumer welfare. The aim should not be to benefit or to target specific sectors, nor to stimulate or introduce competition artificially. Rather, the key objectives should be to reinforce business and consumer confidence, enhance Hong Kong’s pro-enterprise, pro-market environment and to provide a level playing-field for all by combating anti- competitive behaviour.

Stakeholder Concerns

27. The CPRC has received submissions from individuals and organizations during the course of its review, vide Attachment B. These suggest that there are currently divergent views in the community on the extent to which the Government should regulate competition by legislation, and on whether such legislation should apply across all sectors or only to specific areas. Arguments that have been put forward in favour of introducing competition law generally focus on the need to -

a) ensure a level playing field for business in Hong Kong;

b) deter anti-competitive behaviour throughout the economy;

c) address the issue of “bundling” of services across different sectors; and

d) avoid discrimination against certain business sectors or groups of consumers – a good law should apply to all.

In addition, some advocates of a general competition law have also put forward the general argument that such a law could help maximise the efficient use of resources and ensure a wide range of choices and fair prices for consumers.

28. Other submissions have questioned the need for new cross-sector competition law (although even these submissions do accept that there might be an argument for legislating to regulate certain specific sectors), arguing that –

a) Hong Kong is already a free and competitive market and we should be careful of interference in normal business operations;

b) there are other ways to enhance competition in local markets without introducing a new competition law; and

c) introducing a new cross-sector law could increase the cost of doing business locally and affect Hong Kong’s regional competitiveness.

29. The diversity of views put forward indicates that the issue of whether or not to introduce new competition law is potentially a complex and controversial issue. The CPRC therefore considers that the community should be engaged and public opinion canvassed as necessary before new legislation is introduced, and that ultimately, subject to further feedback from the community -

a) any new competition law should be consistent with practice adopted in familiar jurisdictions, including the sector-specific laws currently in place in Hong Kong in areas such as telecommunications and broadcasting; and

b) an incremental approach to any new legislation should be adopted so as to help build broad understanding and acceptance of new measures, and allow the law to develop.

30. Judging from the submissions received by the CPRC, there is concern in some sectors that the enactment of a new law might lead to increased compliance costs that would impact upon business. For example, smaller companies might see themselves at a disadvantage, in that they would not have the resources to defend themselves from legal challenges to their conduct from larger companies. For larger corporations, particularly those in markets with few participants, there is concern that new legislation might be used to target existing market structures that function well in terms of providing services to consumers.

31. The CPRC acknowledges these concerns, and considers it important that any new competition law should not have the effect of adversely affecting normal business operations, unduly raising business costs or interfering with free market structures.

Existing Concerns Relating to Anti-competitive Behaviour

32. A review of the complaints against anti-competitive practices received by COMPAG in recent years (vide Attachment C) indicates that the majority of these concern specific types of perceived anti-competitive conduct, rather than the structure of existing markets. The types of anti-competitive behaviour that are of particular concern to companies and individuals include - 21

a) abuse of a dominant market position by companies, in particular where this might involve predatory pricing or unfair or discriminatory standards;

b) restrictive marketing practices; and

c) price-fixing.

33. The profile of the complainants to COMPAG shows a fairly even split between complaints from large corporations (18% of complaints), individual consumers (18%) and non-government organizations (25%), with a higher proportion of complaints coming from SMEs and individual traders (39%). From these figures, it is fair to assume that anti-competitive conduct is a concern amongst different sectors.

34. One area related to competition that is frequently subject to regulation in other jurisdictions is the issue of mergers and acquisitions. In Hong Kong, there is no clear indication that merger and acquisition activity is currently a threat to competition in most sectors, and having regard to the submissions received, the CPRC has concluded that there is little justification at this time for regulation of mergers and acquisitions outside the existing provisions in sector specific laws covering areas such as broadcasting and telecommunications. Rather, in developing proposals for any new legal framework, the focus should be primarily on sanctioning specific types of anti-competitive conduct that affect normal business operations and jeopardizes the free market economy.

Possible Way Forward

A) Regulating Anti-competitive Conduct

35. In moving towards recommendations on a viable approach to enhancing competition regulation, the CPRC has considered the following factors –

a) whether regulation should be specifically tailored to individual sectors of the economy or be cross-sector in nature;

b) the extent to which new legislation is needed to enhance the competition regulatory regime; and

c) whether any new laws should cover all aspects of competition from the start or should focus initially on the types of conduct that are of greatest concern.

I. Cross-sector or Sector Specific Regulation

36. Currently, competition in Hong Kong is regulated on a sector specific basis, and currently two sectors, namely broadcasting and telecommunications, are regulated by means of industry specific legislation.

37. The CPRC has considered the pros and cons of introducing cross-sector competition regulation, and has come to the view that, as anti-competitive conduct could occur in any sector, there are no strong grounds for targeting only certain individual sectors or industries for regulation. Whilst there might be a common perception that certain specific sectors are particularly vulnerable to 23 anti-competitive behaviour, the profile of complaints to COMPAG in recent years indicates that concerns as to anti-competitive conduct are spread across a large number of sectors. Furthermore, there is no firm evidence that the larger (or more “dominant”) companies in particular sectors are more or less likely to engage in anti-competitive conduct than any other companies.

38. Were the Government to extend competition regulation only on a sector specific basis, it would be difficult to define clearly the exact scope of many of the individual market sectors in Hong Kong, and therefore to put effective regulatory mechanisms in place. In the case of the broadcasting and telecommunications industries, the markets are clearly defined by the licensing regimes under which the relevant authorities govern these sectors. The sector- specific competition legislation governing these sectors was put in place in part to regulate market structures. The CPRC would wish to avoid creating a misunderstanding that it was aiming to target market structure in other sectors through sector specific regulation.

39. In the course of discussion on this aspect of competition regulation, two members of the CPRC have expressed reservations, registering concern that the application of a new competition law across all sectors might adversely affect business. They have argued that a sector specific approach is consistent with the current situation in Hong Kong, and that extending this to cover only those sectors where competition was felt to be of concern to the public would be more prudent than bringing in a full-scale cross-sector law. In due course, and in the light of experience, the law could then gradually be further extended to cover additional sectors.

II. Regulation through Legislation

40. The CPRC has studied the guidelines issued by COMPAG in 2003, which describe specific types of behaviour that are considered to be anti-competitive. It has noted that the Government has adopted measures to tackle identified or potential anti-competitive behaviour. Whilst such guidelines and targeted measures might have a useful educational effect in alerting the business community and the public to the types of anti-competitive conduct that are considered to be detrimental to Hong Kong’s economic efficiency, they are unlikely to have significant deterrent effect. Moreover, COMPAG and most of the relevant government agencies that follow up on complaints to COMPAG do not have sufficiently extensive investigative powers to undertake in-depth inquiries. Therefore it is difficult for COMPAG to reach any conclusive findings that anti-competitive conduct has taken place and to publicise its findings as a deterrent to others.

41. The CPRC has also noted that continuing to regulate competition without legislative backing would require an extensive long-term commitment to publicity, education and encouraging cooperation from all sectors of the community. The only effective sanction that could be deployed would be to “name and shame” companies engaged in anti-competitive behaviour, which, given the ease with which companies can exit and re-enter markets under new names, would provide at best only a limited deterrent. Such an approach would likely cause the public to question the Government’s resolve in tackling anti- competitive conduct in Hong Kong.

42. The CPRC has therefore concluded that the most effective means of regulating anti-competitive behaviour in the market is to put in place a regime 25 that has legislative backing. To ensure broad consistency with the existing competition policy, the legislation concerned should be drawn up with the purpose of preventing anti-competitive conduct rather than seeking to “open up” particular sectors to greater competition. It should also provide for exemptions to be granted by the appropriate authority, where merited on economic or public policy grounds.

43. The two Members expressing reservations about cross-sector regulation are also concerned about the possible adverse effect of a cross-sector law on business, in particular SMEs. They consider that such firms might not be aware of their obligations under a new law, and might unwittingly fall foul of the new provisions. In seeking to ensure compliance with the law, they might face large legal costs. Further, such a law might make them vulnerable to action by large companies seeking to undermine smaller competitors by accusing them of anti- competitive conduct, even without evidence to back up such complaints.

III. Defining the Scope of Competition Law

44. The 2003 COMPAG guidelines give useful examples of types of conduct that might be considered anti-competitive. The review committee has considered whether these are representative of the types of behaviour that should be addressed in seeking to prevent anti-competitive conduct in Hong Kong. In considering the extent to which any new competition law might cover specific types of conduct, the CPRC has taken the view that –

a) the focus of any new law should be on prohibiting defined types of conduct that run counter to the objectives of the competition policy; and

b) by defining the scope of new legislation to cover certain specified types of anti-competitive conduct, the new law would be seen to have more clarity and would therefore be less likely to become a burden to normal business operations. This approach would also allow for regulation to focus on issues that are of the greatest concern in Hong Kong.

45. As regards the detailed description of the specified types of conduct in the law, the CPRC considers that it is difficult to define exhaustively the various practices that might come under the various categories of anti-competitive conduct. Furthermore, if the definitions of such conduct were too detailed, it is likely that frequent legislative amendments would be required to modify these as new examples of anti-competitive practice emerge. In addition, the body charged with determining whether or not anti-competitive conduct has taken place should have a reasonable degree of flexibility to ensure that prevailing and new market conditions could be taken into account.

46. The CPRC has noted the drawbacks of trying to describe the nature of the specified types of conduct exhaustively in the law. It also recognises that a general definition of such conduct might create uncertainty as to what could constitute an illegal practice. For this reason, business and consumers would need clear guidance as to the types of conduct that could be considered anti- competitive. Such guidance could take the form of administrative guidelines, similar to those issued under the Broadcasting and Telecommunications Ordinances, which indicate how the regulatory authority proposes to perform its functions. Whilst such guidelines would not in themselves have legal effect, they could clarify the principles that would govern regulatory considerations and decisions, thereby providing a degree of certainty to stakeholders.

B) Regulatory Procedures

47. The introduction of a new competition law would require the setting up of new regulatory mechanisms. The CPRC has reviewed regulatory models in other administrations around the world, as well as local examples, such as the Broadcasting Authority, the Telecommunications Authority, the Equal Opportunities Commission and the Market Misconduct Tribunal.

48. Having considered these models, the CPRC has come to the view that for the regulation and enforcement of any competition law to be effective, there will be a need for –

a) the regulator to have statutory powers that would allow for full and fair investigation of possible cases of anti-competitive conduct;

b) sanctions that would have a clear deterrent effect; and

c) appropriate checks and balances, including channels of appeal, to guard against abuse or misuse of regulatory powers.

49. The CPRC has considered whether civil or criminal sanctions should apply to proven cases of anti-competitive conduct. Whilst the threat of imprisonment in particular might deter people from engaging in anti-competitive conduct, the CPRC has concluded that civil sanctions, including heavy fines and the threat of disqualification from being a company director should have a sufficiently 28 powerful deterrent effect.3 It also considers that this is a prudent approach to Hong Kong’s first step in putting in place a competition law.

50. The CPRC has also considered the importance of the regulator having further powers and administrative remedies that would help in the effective and efficient enforcement of the law, such as –

a) the power to seek an order from an appropriate judicial authority to require parties to “cease and desist” from anti-competitive conduct, in order to minimize possible harm to markets as soon as possible after such conduct has been detected;

b) the authority to reach a settlement with a party involved in an investigation without the need to seek formal sanctions; and

c) the discretion not to pursue cases in the event of complaints being considered to be inappropriate. This should address the concern noted in paragraph 43 above that small companies might be subject to action by large companies. The decision on the merits of complaints would rest with the regulator.

51. In considering the procedure for issuing “cease and desist” orders, the CPRC has noted that there might be a concern that the process of securing such an order from the courts could lead to delay. However, it is consistent with the role of judicial bodies – and accordingly, should a dedicated judicial body be established to adjudicate on cases of anti-competitive conduct (as is considered in paragraphs 55 to 57 below), it would also be consistent with the role of such a

3 Nonetheless, consistent with general practice relating to the investigation and prosecution of offences under other laws, failure to comply with a direction or undertaking or order related to the provision of evidence should result in criminal sanctions, including imprisonment 29 body - that they should have the power to issue “cease and desist” orders, on application by the Commission.

52. As well as the statutory powers outlined above, the CPRC has discussed the extent to which the regulatory authority should have an advocacy and educational role, noting that legislation on anti-competitive conduct is a relatively new field of the law in Hong Kong, and that it is important that the public and the business sector understand clearly the principles behind the enactment and application of the law.

C) Regulatory Authority and Role of the Courts

53. As regards the administrative structure for the enforcement of competition law, the CPRC considers that it is important for any competition regulatory authority to have sufficient resources and expertise to enforce the competition regime effectively. In addition, a suitable degree of separation from Government bureaux and departments should be provided for. This could be achieved by having the full-time executive subject to the supervision of a non-executive chairman and a non-executive board. The CPRC notes that a similar structure is well established for a number of regulatory bodies in Hong Kong, for example, the Broadcasting Authority.

54. In terms of operation, the extent to which either the executive or the board would be responsible for decisions to initiate investigations or prosecutions will need to be further considered. As the purpose of having a board is to create a two tier structure, it would seem appropriate for the board to operate at a remove from the “hands-on” role of the executive, and to focus on overseeing enforcement policy and how this is applied to specific cases.

55. The CPRC has also deliberated on the adjudicating authority and the role of the courts in enforcing competition law. In this regard, the CPRC has noted the two broad approaches taken in Hong Kong and other jurisdictions, namely –

a) for the regulatory body itself to enforce all aspects of competition law, including deciding cases and imposing penalties, with the role of the courts (including specialist tribunals) being limited to reviewing the regulator’s decisions; or

b) for the courts (or a specialist tribunal) to be responsible for adjudicating cases and handing down penalties following the investigation of cases by the regulator.

56. Whilst noting that allowing the regulator to act as both investigator and adjudicator is consistent with the approach adopted in local broadcasting and telecommunications laws, the CPRC has also considered the case for establishing a specialist tribunal to hear actions brought by the regulatory authority. The CPRC accepts that there are a number of arguments for having a single regulatory body investigate, determine the outcome of and hand down penalties for cases of anti-competitive conduct. For example –

a) a simple and streamlined institutional structure is consistent with the principle of small government;

b) it is likely that cases could be dealt with more quickly by a single regulatory body;

c) if only civil sanctions are to be imposed for breaches of the law, it is questionable whether there is a need for a judicial body to hand down penalties;

d) having separate bodies engaged respectively in the investigation and the adjudication of cases of anti-competitive conduct would require more resources (and quite possibly the duplication of some support functions) than having a single body responsible for all aspects of regulation and enforcement;

e) there is no indication that the competition regimes in place in the United Kingdom and Singapore (as well as the current arrangements in Hong Kong for the broadcasting and telecommunications sectors), where the regulatory authority determines cases and hands down civil penalties, have led to unfair treatment; and

f) the regulatory authority’s decisions could in any event be subject to a specific appeal mechanism that would then be subject to further judicial review by the courts.

57. However, the CPRC is also mindful of the following arguments for establishing such a tribunal to adjudicate on cases of suspected anti-competitive conduct –

a) it would provide for objective judgment of the merits of individual cases at a remove from the day-to-day operation of the regulatory authority;

b) a tribunal would provide a check against over-zealous regulation (for example, through the setting of aggressive quantitative targets for 32

investigation and sanctioning of anti-competitive conduct) by a government-appointed regulator;

c) given that the Government itself may be involved in certain markets from time to time, the existence of such a tribunal, independent of the government-appointed regulator, should reassure the public and the business community that a fair hearing will be given to all parties and without favour; and

d) having a dedicated tribunal to deal with this potentially complex area would allow for the development of specialist knowledge and expertise among a group of independent tribunal members and could also ensure consistency in the application of the law.

Interface with Existing Regulatory Framework

58. As noted elsewhere in this report, legislation to prohibit anti-competitive conduct already exists in the broadcasting and telecommunications sectors in Hong Kong, each of which has its own regulatory framework. It is common in other jurisdictions for the implementation of cross-sector law and sector specific competition laws to be handled by separate agencies, within defined parameters. The cross-sector law may apply to all sectors and the regulators for specific sectors may or may not play a part in the enforcement of the cross-sector law in their own particular sectors. The following table summarises the situation in the jurisdictions that have been studied by the CPRC -

Singapore United Australia USA Canada European Kingdom Union

Cross- Application Competition Act Trade Sherman Act, 1985 EC Treaty, sector or of the 1998 and Practices Act Clayton Act and Competition Articles sector Competition Enterprise Act 1974 is Hart-Scott- Act is 81and 82 are specific Act 2004 is 2002 are applicable to Rodino applicable to applicable to law co- excluded from applicable to all all sectors Anti-trust all sectors all sectors exist sectors for sectors Improvements which there Act are are sector- applicable to all specific sectors competition laws

Enforce Sector Sector Enforcement Sector Enforcement Enforcement ment regulators are regulators have is undertaken regulators like is undertaken is undertaken responsible “concurrent by the general the Federal by the general by the general for powers” in competition Communica- competition competition enforcement enforcement of authority, the tions authority, the authority, the of sector- general Australian Commission, Competition European specific competition Competition have concurrent Bureau. (A Commission competition laws in their and power to enforce Government (the law particular Consumer competition policy review Competition sectors. Commission provisions panel has Directorate) Administrative (including recommended agreements exist mergers) in the in March so that sector sectors under the 2006 that a regulators responsibilities separate enforce of the sector Telecommuni provisions on regulators cations anti-competitive Competition conduct. Tribunal be General established to competition deal with authority competition enforces issues in the provisions on telecommuni- mergers. cations sector.)

Appeal Appeal All appeals are All appeals All appeals are All appeals All appeals mechanisms dealt with by a are dealt with dealt with by the are dealt with are dealt with under sector- common by the courts. courts. by the courts. by the specific tribunal – European competition Competition court system. laws continue Appeal to apply Tribunal, and then the courts

59. The CPRC considers that during the initial years of operation of the cross- sector competition law in Hong Kong, the existing sector specific regimes in broadcasting and telecommunications should be retained for three main reasons. First, the proposed cross-sector competition law is not as comprehensive in coverage as the existing sector specific regimes, for example, the cross-sector regime will not initially deal with mergers and acquisitions. Second, the sector specific regimes have been operating for a number of years and the sector regulators have built up a body of guidelines, procedures and precedents which the new cross-sector authority may take some time to develop. Third, there are advantages for the sector specific regulators to continue to administer competition law in their respective sectors because of their detailed knowledge about the operation of these sectors. There should be coordination between the cross-sector competition authority and the sector regulators about the administration of competition law to ensure consistent enforcement standards.

The Role of COMPAG

60. The CPRC has noted that few of the complaints that have been referred to COMPAG have been substantiated – although, as can be seen from Attachment C, a large proportion of these complaints were not directly related to anti- competitive conduct. The CPRC considers that there is scope for making the role of COMPAG clearer to the public, and for the group to take a more directive and robust approach to handling complaints and assessing the competitiveness of various markets. In this context, the effectiveness of COMPAG in dealing with abuse would continue to be limited unless it were to have statutory powers to investigate and sanction anti-competitive conduct.

61. The specific areas that the CPRC has considered in reviewing the role and membership of COMPAG include the following –

a) Structure: COMPAG could be reconstituted as a two-tier body, with a dedicated secretariat staffed by experts from relevant disciplines underpinning an expanded governing board;

b) Membership: the membership of COMPAG could be broadened to include a wider range of interests from non-government sectors;

c) Transparency: clear guidelines could be established for the investigation of complaints and subsequent reports, and COMPAG could publicise its views on these and review the Government’s progress in following up on specific recommendations;

d) Approach: COMPAG could adopt a more pro-active approach by formulating an Action Plan for the study of sectors where anti-competitive conduct was considered to be a relatively higher risk; and

e) Public Education and Advocacy: to instill a greater sense of awareness of anti-competitive practices within the community, COMPAG could develop suitable PR and educational initiatives.

62. If new legislation were enacted to regulate anti-competitive conduct, the relevant regulatory authority would effectively take over the work currently done by COMPAG. For this reason, given the recommendation in the following section that new competition laws should be introduced, the CPRC considers that it is unnecessary to make recommendations on the future role of COMPAG. 36

Accordingly, the recommendations in the following section focus instead on issues related to the introduction of new competition law, including the establishment of a regulatory authority for competition.

7. Recommendations

63. The following recommendations take account of the considerations set out in the previous section. The CPRC noted that there are certain areas in which there might be more than one viable approach to effective competition regulation. The CPRC considers that engaging the public would help the Government reach a firm conclusion on the best course of action in these areas.

New Legislation to Prohibit Anti-competitive Conduct

64. The CPRC recommends that new legislation should be introduced to guard against anti-competitive conduct that would have an adverse effect on economic efficiency and free trade in Hong Kong. In making this recommendation, the review committee members has had particular regard to the following issues –

a) whether the law should apply only to certain sectors or cover all sectors;

b) the types of anti-competitive behaviour to be addressed in the law; and

c) the regulatory framework for enforcing such a law.

I. Scope of the legislation

65. Rather than targeting individual sectors, the CPRC recommends that the new legislation should apply to all areas of the economy. This recommendation represents the view of the majority of members on the review committee. It takes account of the fact that, unlike in the broadcasting and telecommunications sectors, it would be difficult to define precisely within the law the extent of many 38 of the individual sectors. Moreover, a sector targeted approach runs the risk of introducing a discriminatory element that is not present in the current competition policy.

66. Having considered whether exemptions to the application of the law might be necessary in certain specific instances on public interest grounds or in order to avoid conflict with international obligations, the CPRC recommends that the new legislation should include a general provision to allow the Government to make exemptions from the application of the law in certain defined circumstances. The CPRC also recommends that the regulatory authority should have the discretion to disregard complaints that are inappropriate, so as to guard against the new law being used to stifle legitimate competitive business activity.

67. The CPRC accepts the view enshrined in the Government’s Statement on Competition Policy that the number of operators or scale of operation within a given market should not be a factor in addressing the question of competition. It has concluded that the new law should not target market structures, and should not seek to regulate “natural” monopolies or mergers and acquisitions. Rather, the focus should be on discouraging specific types of anti-competitive conduct that adversely affect economic efficiency or free trade, to the detriment of consumers.

II. Types of anti-competitive behaviour to be regulated

68. Noting the profile of the types of complaint that have been made to COMPAG (vide paragraph 32 above and Attachment C), the CPRC recommends that the following types of anti-competitive conduct should be covered in the cross-sector law –

• Price-fixing • Bid-rigging • Market allocation • Sales and production quotas • Joint boycotts • Unfair or discriminatory standards • Abuse of a dominant market position.

69. The CPRC further recommends that such conduct should not be an offence per se, but rather, the particular conduct must be proven –

a) to have been carried out with the intent to distort the market; or

b) to have the effect of distorting normal market operation and lessening competition.

70. The CPRC has taken the view that there should not be lengthy and detailed descriptions of specific types of conduct in the new law, so as to allow the regulator appropriate flexibility and to avoid the need for frequent legislative amendments. However, given that certainty and clarity are of paramount importance to all stakeholders, the CPRC recommends that appropriate guidelines should be drawn up, by the regulatory authority in consultation with relevant stakeholders, that would include –

• detailed descriptions and examples of the types of anti-competitive conduct listed in the law;

• an indication as to how intent and effect in relation to market distortion might be assessed; and 40

• reference to cases dealt with under existing local sector-specific laws and related overseas legislation.

III. Regulatory framework and procedure

A) Enforcement – a Competition Commission

71. Having studied examples of overseas and local regulatory practice, the CPRC recommends that a regulatory authority, to be known as the Competition Commission, be established under the new law. This authority should have a “two-tier” structure, comprising a governing board (with membership representing various interests – business, professional, consumer and government) underpinned by an executive arm that would include expertise in legal, economic and accounting disciplines. The executive arm would function both as a secretariat and an investigating office.

72. The Commission should have an advisory role, in terms of enhancing and promoting public awareness and understanding of competition issues, providing advice to business – in particular SMEs – to help them avoid unwittingly engaging in anti-competitive conduct and encouraging “fair play” in the markets. It should also be tasked with keeping the scope of the competition legislation under review, and highlighting any potential areas for change for further action by the Government.

73. The CPRC recognises the importance of the Commission having sufficient powers to investigate thoroughly any suspected anti-competitive conduct prohibited by the new law. In line with current practice in Hong Kong and overseas, these should include powers – 41

a) to require a person to give written or oral information;

b) to require the production of documents or other records or data; and

c) with a warrant issued by the court, to enter and inspect premises and seize relevant documentary evidence.

74. In this connection, the Commission should be responsible not only for implementing the relevant aspects of the new law, but should also be required to draw up its own administrative guidelines and procedures, in consultation with stakeholders. These should include the discretion not to follow up on complaints of a frivolous or vexatious nature that might have the effect of impeding normal competitive business activity.

B) Sanctions and Review – a Competition Tribunal

75. The CPRC has agreed that appropriate checks and balances should be put in place to ensure that business is not subject to unnecessarily rigorous regulation by the new competition authority. The review committee has noted that one option is to establish a Competition Tribunal, which would either –

a) adjudicate on cases brought by the Competition Commission and, where appropriate, hand down sanctions; or

b) act as a review body, hearing appeals against decisions by the Competition Commission (should the latter have sanctioning powers).

76. Having considered the pros and cons of such a tribunal acting as a sanctioning authority (vide paragraphs 55 to 57 above), the CPRC recommends that the Government seriously consider the merits of establishing a Competition Tribunal to adjudicate and, where appropriate, impose penalties in respect of cases brought by the Competition Commission in the latter’s role as an enforcement agency. The chair and members of such a Tribunal should have appropriate expertise and a high degree of independence and credibility. The Tribunal should develop its own procedures, with a clear emphasis on bringing any hearings to a timely conclusion

77. As regards the sanctions to be applied for breaches of the law, the CPRC considers that civil penalties should be a sufficient deterrent to anti-competitive conduct. Accordingly, it recommends that civil penalties, exemplified by heavy fines should apply in cases where anti-competitive conduct is found to have occurred. Parties aggrieved at the outcome of cases or the penalties handed down should have access to the review channels available through the courts.

78. To minimise risk to normal business operations from continued anti- competitive conduct pending the determination of a case, the CPRC recommends that there should be provision in the law for the issue of an order to compel a business to cease and desist from anti-competitive conduct, and that the power to issue such an order be vested in the Competition Tribunal, if such a tribunal is to be established. The potential for delay in obtaining such an order could be minimised by, for example, empowering the Tribunal to issue interim orders in instances where the Commission could show a prima facie case that allowing suspected anti-competitive conduct to continue would cause a significant degree of harm to the market.

79. Regardless of the outcome of individual cases of anti-competitive conduct, parties affected by such conduct should be entitled to take civil action in the courts for the recovery of damages suffered. The CPRC considers that such action should not be precluded under the law, and that proven anti-competitive conduct could be cited as grounds for claiming damages.

80. For ease of reference, a diagram showing the various stages of the regulatory process recommended by the CPRC is at Attachment D to this report.

8. Implementation

81. The CPRC acknowledges that cross-sector competition legislation sanctioning certain behaviour is an unprecedented step and one that could have wide ranging implications in different sectors of the community. The CPRC therefore recommends that the following steps be taken with regard to the implementation of the proposed competition legislation.

82. First, there is a need to engage the public in a thorough and inclusive process of consultation. As well as publishing a suitable consultation document that sets out clearly the background and considerations related to the review of competition policy, the Government should encourage the public to give their views on the issues covered in this report through channels such as public forums, interactive workshops and online discussion platforms. Engaging stakeholders in such a transparent and participatory consultation process should help the Government to develop a clear picture of the most viable parameters for an efficient and effective regulatory regime before introducing new legislation.

83. Second, the Government should carefully plan the administrative and resource requirements for the establishment of an appropriate body to oversee the implementation of the competition regime. Experience in Hong Kong has so far been mostly limited to the telecommunications and broadcasting sectors, and there will be a need to source appropriate administrative, legal and economic expertise to ensure that the new regulatory structure is well-equipped to deal with complaints and investigations.

84. Finally, there will be a need to ensure that any new competition regulatory regime coexists with the related legislation in respect of telecommunications and broadcasting, with a clear delineation of roles and minimal overlap of resources.

85. Competition, and competition legislation in particular, is a complex issue. In taking forward the proposals in this report, it is important that the Government place appropriate emphasis on educating the business community and the wider public as consumers on the role that competition plays in enhancing economic efficiency and delivering benefits to society as a whole. The Government should also make available opportunities for local stakeholders to understand how competition law takes effect in other jurisdictions, in addition to ensuring that the provisions continue to meet the needs of time.

Competition Policy Review Committee June 2006

Attachment A

Membership of Competition Policy Review Committee

Mr. Christopher Cheng (Chairman) Mr. Andrew Brandler Prof. Andrew Chan Prof. K. C. Chan Dr. William Fung Mr. John Griffiths Mr. Peter Hung Mr. Ip Kwok-him Mr. Larry Kwok Mr. Frederick Lam Hon. Andrew Leung Hon. Sin Chung-kai

Ex officio members

Ms Sandra Lee, Permanent Secretary for Economic Development (to 30 March 2006) Ms Eva Cheng, Permanent Secretary for Economic Development (from 10 April 2006) Mr. Au Man-ho, Director-General of Telecommunications Mr. Kwok Kwok-chuen, Government Economist Mr. Philip Yung, Deputy Secretary (Commerce and Industry)

Attachment B

List of Submissions Received by the CPRC

1. Democratic Party

2. Hong Kong General Chamber of Commerce

3. The Real Estate Developers Associates of Hong Kong

4. Hong Kong Young Industrialists Council

5. Consumer Council

6. Mr. Larry Kwok

7. Hong Kong Business Economic Forum

8. Record of Proceedings of a Workshop on “Drafting a Competition Law for Hong Kong: Major Provisions and Enforcement” held on 8th February 2006 at The Hong Kong Polytechnic University, submitted by Dr Mark Williams and Dr Stephen Luk

9. ExxonMobil Hong Kong Ltd

10. Cathay Pacific Airways

11. Hon. Ronny Tong

12. Federation of Hong Kong Industries

13. The Chinese Manufacturers’ Association of Hong Kong

Attachment C

Review of Complaints to COMPAG from 2001-02 to 2004-05

A. Nature of Complaints

Alleged Anti-competitive conduct No. of cases

Unfair or restrictive government practices 21 Abuse of dominant market position 15 (including predatory pricing) Miscellaneous Restrictive practices1 9 Price-fixing 7 Bundling of services 3 Unfair or discriminatory standards 3 Market allocation 1 Exclusive arrangement 1 Joint boycott 1 Others2 6

Total : 67

1. Includes: obstructing market entry, providing inferior service or charging competitors unreasonably high prices and creating artificial barriers to discourage customers from switching to competitors. 2. Studies initiated by COMPAG on the situation in certain sectors and alleged conflict of interest of publicly-funded organizations.

B. Profile of Complainants

Sector No. of cases

NGOs 15 Individuals (traders) 13 Large Corporations 11 SMEs 11 Individual consumers/others 11

Total : 613

3. Excludes 6 cases that were initiated by COMPAG.

C. Broad Areas of the Economy Involved

Broad Area No. of cases

Telecommunications 14 Professional services4 12 Trading & Retailing 9 Catering & Food supply 7 Transportation & Logistics 6 Real estate & Property management 5 Broadcasting & Media 3 Health care 3 Personal services5 3 IT 2 Airline & hotel 2 Miscellaneous 1

Total : 67

4. Professional services include accounting & finance, consultancy services, insurance, security services and maintenance of equipment 5. Personal services include interior decoration and car washing

Attachment D

Illustrative Procedural Framework for Investigation of Anti-competitive Conduct

Initiation of Complainant lodges complaint or Competition Commission Investigation complaint initiates investigation

Competition Commission

y Conducts pre-investigation screening

Screening and y Launches formal investigation on cases with prima facie formal evidence – no follow-up on frivolous complaints investigation y Requires information from party alleged to have engaged in anti-competitive behaviour – court warrant to enter premises

and seize documents where necessary y Completes investigation

(Depending on whether or not Competition Tribunal is established)

Competition Commission Commission Tribunal y Decides whether an y Decides whether an Conclusion and offence has taken place offence has taken place Sanction y Sanctions offences – y Sanctions offences – civil penalties civil penalties

Appeal Mechanism

Appeal and Civil Courts Action y Review decision if the offender is aggrieved y Adjudicate on civil claims for damages initiated by the complainant

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Annex C

IMPLICATIONS OF THE PROPOSAL

Financial and Civil Service Implications

The setting up of a new regulatory authority to enforce the law effectively would require additional recurrent resources. Having made reference to a number of local and overseas regulatory authorities, we consider that the authority would need a full-time executive of about 70 staff, many of whom would have professional legal, accounting or economics backgrounds. We estimate that such an establishment would require an annual budget of $60 million to $80 million. The additional resources required will be sought in accordance with established procedures.

Economic Implications

2. By providing a level playing-field for all, the proposed competition regulatory regime would help ensure the free play of market forces and enhance competition. It would enhance economic efficiency and the free flow of trade, thereby reinforcing business confidence and benefiting consumers. The economic benefits would likely be higher output, lower prices and more choices of products. Experience from other jurisdictions suggests that small businesses would not face a significant increase in compliance costs, given that they would be unlikely to be targeted by competition regulation. Large businesses might look to engage additional resources to help ensure compliance, especially at the initial stage. Multi-nationals, which already have to comply with competition regulatory regimes elsewhere, may be better able to adapt to new legislation. For the economy as whole, the additional cost to business should be more than offset by the longer-term benefits of a more effective and credible competition regime.

Sustainability Implications

3. As far as sustainability implications are concerned, the guiding principle of achieving a competitive and prosperous market-based economy which provides the resources to meet the needs and aspirations of the population will be observed.