/LQX[$VVHPEO\/DQJXDJH3URJUDPPLQJ

)URQW0DWWHU

7DEOHRI&RQWHQWV

$ERXWWKH$XWKRU

/LQX[$VVHPEO\/DQJXDJH3URJUDPPLQJ

%2%1(9(/1

3XEOLVKHU3UHQWLFH+DOO375

)LUVW(GLWLRQ-XO\
,6%1SDJHV

0DVWHU[DVVHPEO\ODQJXDJHIURPD/LQX[SHUVSHFWLYH

(VVHQWLDOLQIRUPDWLRQIRUFUHDWLQJ/LQX[GHYLFHGULYHUV

+RZ/LQX[ZRUNVXQGHUWKHKRRG

&'520LQFOXGHVHGOLQDVWKH/LQX[[KDQGVRQDVVHPEOHUGHYHORSPHQWVLPXODWRU

/LQX[$VVHPEO\/DQJXDJH3URJUDPPLQJLVWKHILUVW/LQX[FHQWHUHGJXLGHWR[DVVHPEO\

ODQJXDJH

,Q/LQX[$VVHPEO\/DQJXDJH3URJUDPPLQJ%RE1HYHOQH[SODLQVDOOWKHNH\IHDWXUHVRI[

DVVHPEO\ODQJXDJHLQWKHFRQWH[WRIWKH/LQX[RSHUDWLQJV\VWHPDQGWKH&ODQJXDJH7KH

ERRN¶VVWHSE\VWHSRQHFRQFHSWDWDWLPHFRYHUDJHZLOOKHOSDQ\KDUGZDUHSURJUDPPHU

PRYHWR/LQX[DQGPDVWHUHVVHQWLDOVNLOOVIRU/LQX[GHYLFHGULYHUGHYHORSPHQW<RXZRQ¶W

MXVWOHDUQQHZ[DVVHPEO\ODQJXDJHVNLOOV\RX¶OODOVRJDLQSRZHUIXOXQGHUWKHKRRG

LQVLJKWLQWRKRZ/LQX[ZRUNV%RQXV&'520LQFOXGHVHGOLQDVWKH/LQX[EDVHG[

LQWHUDFWLYHDVVHPEOHUGHYHORSPHQWVLPXODWRU7KLVLV/LQX[[DVVHPEO\ODQJXDJH

SURJUDPPLQJIURPVWDUWWRILQLVK

3ODFHKROGLQJQXPHUDWLRQ

/RJLFFLUFXLWV

&RPSXWDWLRQ

7KHIRXUILHOGIRUPDW

0DFKLQHODQJXDJH

0HPRU\

7KHVWDFN

/LQX[XVHUSURJUDPV

1$60

'26SURJUDPV

,QWHUUXSWV

%LWPDQLSXODWLRQV

'HYLFHGULYHUV

$QGPRUH

‹E\3UHQWLFH+DOO

3XEOLVKHGE\3UHQWLFH+DOO375

3UHQWLFH+DOO,QF

8SSHU6DGGOH5LYHU1-

3UHQWLFH+DOOERRNVDUHZLGHO\XVHGE\FRUSRUDWLRQVDQGJRYHUQPHQWDJHQFLHVIRUWUDLQLQJPDUNHWLQJDQG

UHVDOH

7KHSXEOLVKHURIIHUVGLVFRXQWVRQWKLVERRNZKHQRUGHUHGLQEXONTXDQWLWLHV)RUPRUHLQIRUPDWLRQFRQWDFW

&RUSRUDWH6DOHV'HSDUWPHQW3KRQH)D[(PDLO

FRUSVDOHV#SUHQKDOOFRP



RUZULWH3UHQWLFH+DOO375&RUS6DOHV'HSW2QH/DNH6WUHHW8SSHU6DGGOH5LYHU1-

$OOSURGXFWVRUVHUYLFHVPHQWLRQHGLQWKLVERRNDUHWKHWUDGHPDUNVRUVHUYLFHPDUNVRIWKHLUUHVSHFWLYH

FRPSDQLHVRURUJDQL]DWLRQV6FUHHQVKRWVUHSULQWHGE\SHUPLVVLRQIURP0LFURVRIW&RUSRUDWLRQ

$OOULJKWVUHVHUYHG1RSDUWRIWKLVERRNPD\EHUHSURGXFHGLQDQ\IRUPRUE\DQ\PHDQVZLWKRXW

SHUPLVVLRQLQZULWLQJIURPWKHSXEOLVKHU

3ULQWHGLQWKH8QLWHG6WDWHVRI$PHULFD



3UHQWLFH+DOO,QWHUQDWLRQDO8./LPLWHG/RQGRQ

3UHQWLFH+DOORI$XVWUDOLD3W\/LPLWHG6\GQH\

3UHQWLFH+DOO&DQDGD,QF7RURQWR

3UHQWLFH+DOO+LVSDQRDPHULFDQD6$0H[LFR

3UHQWLFH+DOORI,QGLD3ULYDWH/LPLWHG1HZ'HOKL

3UHQWLFH+DOORI-DSDQ,QF7RN\R

3UHQWLFH+DOO$VLD3WH/WG

(GLWRUD3UHQWLFH+DOOGR%UDVLO/WGD5LRGH-DQHLUR

&UHGLWV

(GLWRULDOSURGXFWLRQVXSHUYLVLRQ

9LQFHQW-DQRVNL

$FTXLVLWLRQVHGLWRU

0LOHV:LOOLDPV

0DUNHWLQJPDQDJHU

.DWH+DUJHWW

0DQXIDFWXULQJPDQDJHU

$OH[LV+H\GW

&RYHUGHVLJQGLUHFWRU

-HUU\9RWWD

&RYHUGHVLJQHU

1LQD6FXGHUL

7KLVERRNLVGHGLFDWHGWRDOOLPSULVRQHG3ORZVKDUHVDFWLYLVWVIRUDWWHPSWLQJWRGRZLWKLURQZKDWDOVRQHHGV

WREHGRQHZLWKVLOLFRQ

/LQX[$VVHPEO\/DQJXDJH3URJUDPPLQJ

35()$&(

,1752'8&7,21

7KH)HWFK([HFXWH&\FOH

7KH/LQX[2SHUDWLQJ6\VWHP

7KH*QX&&RPSLOHU

7KH(GOLQDV$VVHPEOHU

1$60

2WKHU$VVHPEOHUV

3/$&(+2/',1*180(5$7,21

7KH'HFLPDODQG3HQWLPDO6\VWHPV

3HQWLPDO$ULWKPHWLF

&RQYHUVLRQWR3HQWLPDO

7KH%LQDU\6\VWHP

0HPRU\DVD5HFWDQJOHRI%LWV

7KH+H[DGHFLPDO6\VWHP

%DVH'LVWLQJXLVKLQJ1RWDWLRQV

 )UDFWLRQVLQ2WKHU%DVHV

 &RQYHUWLQJ)UDFWLRQV

/2*,&&,5&8,76$1'&20387$7,21

7KH127*DWH

%RROHDQ2SHUDWRUV

/RJLF*DWHV

$GGLWLRQ&LUFXLWV

6HTXHQWLDO&LUFXLWV

1HJDWLYH1XPEHU5HSUHVHQWDWLRQ

6XEWUDFWLRQ8VLQJ1HJDWLRQ

 3ODFHKROGLQJ7ZR V&RPSOHPHQW

0HPRU\&LUFXLWV

[*HQHUDO5HJLVWHUVDQGWKHLU$QFHVWU\

7KH029&RPPDQG

$GGLWLRQDQG6XEWUDFWLRQ&RPPDQGV

 0XOWLSOLFDWLRQDQG'LYLVLRQ&RPPDQGV

$66(0%/</$1*8$*(

7KH)RXU)LHOG)RUPDW

&RPSXWHUVIURPWKH&386WDQGSRLQW

6LPSOH$VVHPEO\/DQJXDJH3URJUDPV

$VVHPEOHU3URJUDPVZLWK-XPSV

$VVHPEOHU3URJUDPVZLWK/RRSV

6LJQHG&RPSDULVRQV

8QVLJQHG&RPSDULVRQV

/LQX[VILOHV

0$&+,1(/$1*8$*(

$VVHPEOLQJ6LPSOH3URJUDPV

2SFRGH6SDFH

7KH0RG50%\WH

6SDFH2)«

%LWYV%LW&RGH

7KH%LW5HJLVWHUV

/LQX[)LOHV

0(025<

%\WH'DWD:LGWK

$GGUHVVHVLQ%UDFNHWV

2SHUDQG6L]H$PELJXLW\

/DEHOV

,PPHGLDWH6WRUDJH

7+(67$&.

3XVKDQG3RS2SHUDWLRQV

6XESURJUDPV

3DUDPHWHU3DVVLQJ

5HFXUVLRQ

/,18;86(5352*5$06

0XOWLWDVNLQJ

3DJLQJ

$GGUHVV7UDQVODWLRQ

3URJUDP6HJPHQWV

2WKHU'DWD6HJPHQWV

,23URWHFWLRQ

([HFXWDEOH)LOHVLQ(/))RUPDW

2EMHFW)LOHVLQ(/))RUPDW

,17(558376

3ROOLQJ

([WHUQDO,QWHUUXSWV

,6$$UFKLWHFWXUH

,QWHUQDODQG6RIWZDUH,QWHUUXSWV

6\VWHP&DOOV

3ULYLOHJH/HYHOV

&RQWURO7UDQVIHU

6FKHGXOLQJ

%,70$1,38/$7,216

%LWZLVH/RJLF2SHUDWLRQV

7KH$1'25127DQG;25&RPPDQGV

%LW6HWWLQJDQG7HVWLQJ

6KLIW,QVWUXFWLRQV

'(9,&('5,9(56

'HYLFH,QGHSHQGHQW)LOHV

'HYLFHVDV)LOHV

0RUVH&RGH6SHDNHU'ULYHU

6HULDO3RUW'LJLWL]HU'ULYHU

'26352*5$06

5HDO0RGH6HJPHQWDWLRQ

(GOLQDV(QYLURQPHQW9DULDEOHV

)L[HG0HPRU\$UHDV

5HDO0RGH,QWHUUXSWV

&KHFNLQJ'260HPRU\

/,18;%2277,0(352*5$06

&KDQJLQJWR3URWHFWHG0RGH

3URWHFWHG0RGH6HJPHQWDWLRQ

6HWWLQJ8SWKH*OREDO'HVFULSWRU7DEOH

&ORVLQJ

35()$&(

$VVHPEO\ODQJXDJHLVODQJXDJHZKLFKJLYHVWKHSURJUDPPHUGLUHFWFRQWURORYHUWKHFRPSXWHU7KDWLVZKDW

DSSHDOVWRSHRSOHDERXWDVVHPEO\ODQJXDJH,WLVOLNHXVLQJDVWLFNVKLIW3URJUDPPLQJZLWKRWKHUODQJXDJHV

KLJKOHYHOODQJXDJHVLVOLNHXVLQJDQDXWRPDWLF

0DQ\SHRSOHZKRXVHFRPSXWHUVVLPSO\UXQSURJUDPV7RWKHPDSURJUDPLVDFDQQHGVRIWZDUHSDFNDJH

3HRSOHZKROLNHWRZULWHSURJUDPVOLNHWREHDEOHWRVKDSHWKHEHKDYLRURIWKHPDFKLQHWKHZD\PHWDOVPLWKV

VKDSHPHWDOLQWRXVHIXOPHFKDQLFDOWRROV$PRQJVWDOOWKHSURJUDPVRQDFRPSXWHUWKHUHLVRQHSURJUDP

ZKLFKUXQVWKHPDFKLQHWKHRSHUDWLQJV\VWHP,WFRQWUROVHYHU\WKLQJ,WRIIHUVVHUYLFHVWRWKHRWKHU

SURJUDPV0RVWRSHUDWLQJV\VWHPVIRUFHSURJUDPPHUVWROHDYHWKHLUSURJUDPPLQJVNLOOVEHKLQGDVWKH\

DSSURDFKWKHRSHUDWLQJV\VWHPDQGWRXVHLWDVWKH\ZRXOGDFDQQHGVRIWZDUHSDFNDJH7KDWLVEHFDXVHLWV

VRXUFHFRGHLVDVHFUHW/LQX[SRUWHQGVWKHHQGRIVHFUHWFRGHLQFRPSXWLQJ%HFDXVHWKH/LQX[VRXUFHFRGH

DQGDFRPSLOHUIRULWDUHULJKWWKHUHRQWKHFRPSXWHUDORQJZLWKWKHRWKHUVRXUFHFRGHLWDOORZVSURJUDPPHUV

WRZRUNZLWKWKHRSHUDWLQJV\VWHPDVWKH\GRZLWKSURJUDPVWKH\KDYHZULWWHQ

2SHUDWLQJV\VWHPVZHUHRQFHZULWWHQE\SURJUDPPHUVHPSOR\HGE\FRPSXWHUPDQXIDFWXUHUV5HYROXWLRQVLQ

KDUGZDUHSURGXFHGFRUUHVSRQGLQJUHYROXWLRQVLQWKHVRIWZDUH:KHQ/LQXV7RUYDOGVUHZURWH/LQX[VRWKDWLW

ZRXOGUXQRQWKH$OSKDDUFKLWHFWXUHKLVJRDOZDVQRWWRLQFUHDVHLWVKDUGZDUHEDVHIURPRQHSODWIRUPWR

WZREXWWRPDNH/LQX[SODWIRUPLQGHSHQGHQW7KHVXEVHTXHQWSRUWVRI/LQX[WRHYHU\WKLQJIURPD6SDUFWR

D3RZHU3&GHPRQVWUDWHWKHVXFFHVVRIKLVUHZULWH7KHFKLHIYDOXHRILWLVWKDWLWSURYLGHVXVZLWK

FRQILGHQFHWKDW/LQX[LVKHUHWRVWD\:HGRQ WKDYHWRIHDUD3RZHU3&UHYROXWLRQFRPLQJDORQJDQGIRUFLQJ

XVWRGXPSDOORIRXUROGVRIWZDUH

$VVHPEO\FRGHRQWKHRWKHUKDQGLVLQWULQVLFDOO\SODWIRUPGHSHQGHQWDQGLVMXVWLILDEO\UHJDUGHGZLWK

FDXWLRQIRUMXVWWKLVUHDVRQ,WZLOOKDYHWREHUHGRQHZKHQWKHQH[WKDUGZDUHUHYROXWLRQWDNHVSODFH

)XUWKHUPRUHSHRSOHZKRFRPSDUHWKHPDFKLQHODQJXDJHRIWKHZLWKRWKHUPDFKLQHODQJXDJHVERWKUHDO

DQGLGHDOLQHYLWDEO\HQGXSUHJDUGLQJWKHODQJXDJHDVDKLVWRULFDODFFLGHQW2QWKHRWKHUKDQGWKH

JHQHWLFFRGHLVVRPHWLPHVUHIHUUHGWRDVDIUR]HQDFFLGHQW7KHWHUPLVEDVHGRQWKHLGHDWKDWWKHJHQHWLF

FRGHFHDVHGLWVHYROXWLRQZKHQWKHQXPEHURISURWHLQVZKRVHFRGHZRXOGEHEURNHQE\DPXWDWLRQLQWKH

JHQHWLFFRGHEHFDPHVRODUJHWKDWVXFKPXWDWLRQVEHFDPHOHWKDODQGVRWKHFRGHEHFDPHIL[HG,WUHPDLQVWR

EHVHHQZKHWKHUPDFKLQHFRGHKDVEHHQIUR]HQLQWRSODFHE\WKHVL]HRILWVVRIWZDUHEDVH7KHWKUHDW

RID3RZHU3&UHYROXWLRQKDVSDVVHG2QWKHRWKHUKDQGPDQ\/LQX[HQWKXVLDVWVDQWLFLSDWHDQ$OSKD

UHYROXWLRQ

%XWWKH$OSKDUHYROXWLRQKDVQRWKDSSHQHGDQGLWPD\QRWKDSSHQ7KHODQJXDJHKDVEHHQDURXQGIRUD

ORQJWLPH:LWKPDQ\5,6&PDFKLQHVQRZHPXODWLQJWKHDUFKLWHFWXUHLVQ WLWWLPHWRFRQVLGHU

SURJUDPPLQJLQDVVHPEO\ODQJXDJH"$VVHPEO\ODQJXDJHLVPRUHZRUNEXWLWKDVLWVDGYDQWDJHV$YHU\

QLFHIHDWXUHRIDVVHPEO\ODQJXDJHFRGHZKLFKLWVKDUHVZLWK/LQX[LWVHOILQFLGHQWDOO\LVWKDWIURPDFUDVV

SHUIRUPDQFHVWDQGSRLQWLWIXQFWLRQVEHDXWLIXOO\5HO\LQJRQFRPSLOHUVWRSURGXFHJRRGFRGHLVXVXDOO\

MXVWLILDEOHDVDWLPHVDYLQJPHDVXUH%XWWRJHWWKHEHVWSRVVLEOHFRGHWKHUHLVVWLOOQREHWWHURSWLRQWKDQWR

XVHDVVHPEO\ODQJXDJH:KHQKLJKOHYHOODQJXDJHVZHUHVWLOODQRYHOW\DQGUHIHUUHGWRDVDXWRPDWLF

SURJUDPPLQJPDQ\SURJUDPPHUVZHUHJUHDWO\RIIHQGHGE\WKHP7KH\ZHUHFRQYLQFHGWKDWQRFRPSLOHU

SURJUDPFRXOGZULWHFRGHDVZHOODVWKH\FRXOG7KH\ZHUHULJKWRIFRXUVH&RPSLOHUVSURGXFHFKHDSHUFRGH

EXWQRWEHWWHUFRGH7RJHWWKHIXOOPHDVXUHRIVSHHGDQGJUDFHWKDWDPDFKLQHLVFDSDEOHRIWKHUHLVQR

VXEVWLWXWHIRUDVVHPEO\ODQJXDJH

)XUWKHUPRUHHYHQLIWKH$OSKDUHYROXWLRQDUULYHVRQVFKHGXOHWRPRUURZWKHUHZLOOUHPDLQLQWKHZRUOG

PLOOLRQVRISURFHVVRUVUXQQLQJDODQJXDJHZKLFKZRUNEHDXWLIXOO\DQGQHHGWREHSXWWRDVRFLDOO\

UHVSRQVLEOHXVH

&RPSXWHUVFDQEHSURJUDPPHGWRUHSRUWRQRXUEX\LQJKDELWVRUWRVHQGRIIQXFOHDUPLVVLOHV%XWWKH\FDQ

DOVREHSURJUDPPHGWRFRPPXQLFDWHZLWKSULYDF\RUWRVXSSRUWPHGLFDOUHVHDUFK$VVLOLFRQVPLWKVRXUMRE

LVWRVKDSHWKHEHKDYLRURIWKHPDFKLQHWRZDUGVDKXPDQDJHQGD

7KLVERRNDVVXPHVWKDWWKHUHDGHUKDVVRPHNQRZOHGJHRI&EXWLWPDNHVQRRWKHUDVVXPSWLRQV

6WDUUHGVHFWLRQVRIWKHERRNDUHQRWQHHGHGVXEVHTXHQWO\DQGPD\EHVNLSSHGZKHQWKH\DUHQRWRILQWULQVLF

LQWHUHVW

,RZHWKDQNVWR'DYH)HOWHUIRUZULWLQJDSDUWLDOVLPXODWRURIWKH7KLVVLPXODWRUJRWPHVWDUWHGZULWLQJ

(GOLQDV

,RZHWKDQNVWR%UXFH*UDQW,W]LFN9DWQLFNDQG.DWH/ $UPDQGIRUZRUNLQJZLWKPHRQWKHVFDOH[GHYLFH

GULYHU

,RZHWKDQNVWRWKHPDQ\VWXGHQWVZKRKDYHIRXQGHUURUVLQHDUOLHUGUDIWVRIWKLVERRN,RZHVSHFLDOWKDQNV

WR-RH%LVVHOO6FRWW+DZNLQV-DVRQ.UROO1DQF\<RVKLPXUDDQG-RDQQH<XUFKDNIRUWKHLUFDUHIXO

GHWDLOHGDQGWKRXJKWIXOFULWLWLVP0DQ\HUURUVXQGRXEWHGO\UHPDLQ7RWKRVHUHDGHUVZKRQRWLI\PHRIWKHP

DW

QHYHOQ#FVZLGHQHUHGX

,VKDOOEHJUDWHIXO

/LQX['ULYHQ6HULDO3RUW,QSXW'HYLFH

&KDSWHU,1752'8&7,21

,QWKLVFKDSWHUVRPHQHFHVVDU\WRROVDQGEDFNJURXQGLGHDVDUHUHYLHZHG

7KH)HWFK([HFXWH&\FOH

2QHRIWKHHDUOLHVWHOHFWURQLFFRPSXWHUVZDVWKH(1,$&:KHQLWZDVILUVWEXLOWLWFRXOGQRWVWRUHSURJUDPV

(DFKQHZFRPSXWDWLRQUHTXLUHGPRYLQJSOXJVDQGMXPSHUFDEOHV1RZKRZHYHUQHDUO\DOOFRPSXWHUVVWRUH

SURJUDPV)RUWKHVHFRPSXWHUVGRLQJDFRPSXWDWLRQPHDQVUXQQLQJDSURJUDP7KHSODFHZKHUHWKH

SURJUDPLVVWRUHGLVFDOOHGPHPRU\7KHSDUWRIWKHPDFKLQHZKLFKGRHVWKHFRPSXWDWLRQLVFDOOHGWKH

SURFHVVRU&RPSXWHUSURJUDPVJHQHUDOO\WDNHWKHIRUPRIDOLVWRILQVWUXFWLRQV&RPSXWDWLRQLVSHUIRUPHGE\

WKHSURFHVVRUXVLQJWKHIHWFKH[HFXWHF\FOH7KHIHWFKH[HFXWHF\FOHFRQVLVWVRIDUHSHDWHGSURFHVVWKDW

LQFOXGHVWKHVHVWHSV

6WHS

7KHSURFHVVRUIHWFKHVDQLQVWUXFWLRQIURPPHPRU\

6WHS

7KHSURFHVVRUH[HFXWHVWKHLQVWUXFWLRQ

6WHS

7KHSURFHVVRUF\FOHVEDFNWRVWHS

&RPSXWHUVEDVHGRQWKHIHWFKH[HFXWHF\FOHDUHVRPHWLPHVFDOOHG9RQ1HXPDQQFRPSXWHUV9RQ1HXPDQQ

ZDVDZHOONQRZQPDWKHPDWLFLDQZKRZDVDOVRDQHDUO\FRPSXWHUWKHRULVW

3UREDEO\WKHPRVWLPSRUWDQWH[DPSOHVRIFRPSXWHUVZKLFKDUHQRWEDVHGRQWKHIHWFKH[HFXWHF\FOHDUH

'1$FRPSXWHUVDQGTXDQWXPFRPSXWHUV2IFRXUVHLWPD\EHWKDWWKHVHFRPSXWHUVZLOOUHDFKDSRLQWLQ

WKHLUGHYHORSPHQWZKHQWKH\DUHUHDG\WROHDYHXQLYHUVLW\ODERUDWRULHVDQGWKDWE\WKDWWLPHWKH\WRRZLOO

UXQVWRUHGSURJUDPV

)LJXUH$6WRUHG3URJUDP&RPSXWHU

7KH/LQX[2SHUDWLQJ6\VWHP

0RVWFRPSXWHUVGRQRWVLPSO\UXQRQHSURJUDPDWDWLPH7KH\UXQDSURJUDPUXQQLQJSURJUDPFDOOHGDQ

RSHUDWLQJV\VWHP,WLQWHUDFWVZLWKWKHXVHUDQGPDQDJHVKDUGZDUHGHYLFHVVXFKDVWKHGLVNGULYHVDQG

SULQWHUVDQGUXQVRWKHUSURJUDPV7KHHDUOLHVWRSHUDWLQJV\VWHPVZHUHZULWWHQE\FRPSXWHUYHQGRUV(DFK

FRPSXWHUKDGLWVRZQRSHUDWLQJV\VWHP7KHILUVWYHQGRULQGHSHQGHQWRSHUDWLQJV\VWHPZDVWKH8QL[

RSHUDWLQJV\VWHP,WZDVGHYHORSHGE\DKDQGIXORIUHVHDUFKHUVDW%HOO/DEV

$7 7WKHSULQFLSDORZQHURI%HOO/DEVVRRQPDGH8QL[DYDLODEOHIRUDQRPLQDOIHHWRDFDGHPLF

LQVWLWXWLRQVZKLFKLQWXUQGHYHORSHG8QL[IXUWKHU7KLVJHQHURXVEHKDYLRURQWKHSDUWRI$7 7PD\KDYH

EHHQLQIOXHQFHGE\DFRQVHQWGHFUHHHQWHUHGLQZKLFKUHVWULFWHGFRPPHUFLDODFWLYLW\RQWKHSDUWRI

$7 7EH\RQGIXUQLVKLQJFRPPRQFDUULHUFRPPXQLFDWLRQVVHUYLFHV7KLVGHFUHHZDVWKHUHVXOWRID

FRPSODLQWLQE\WKH-XVWLFH'HSDUWPHQWDJDLQVW:HVWHUQ(OHFWULFDQG$7 7FODLPLQJWKDWWKH\ZHUH

WU\LQJWROHYHUDJHWKHLUWHOHSKRQHPRQRSRO\LQWRRWKHUVHFWRUV

7KHYHUVLRQRI8QL[GHYHORSHGDWWKH8QLYHUVLW\RI&DOLIRUQLDDW%HUNHOH\EHFDPHYHU\ZLGHO\XVHG,WZDV

GHVLJQHGWREHSRUWDEOHLHHDV\WRWUDQVIHUIURPRQHW\SHRIFRPSXWHUWRDQRWKHU,WLVNQRZQDV%HUNHOH\

8QL[RU%6'8QL[%HUNHOH\6RIWZDUH'LYLVLRQ

/LQX[LVDQRQSURSULHWDU\YDULDQWRI8QL[ZKLFKZDVFUHDWHGE\/LQXV7RUYDOGVRQDEDVHGFRPSXWHU

DQGVXEVHTXHQWO\GHYHORSHGE\DQRQOLQHFRPPXQLW\RIXVHUV$OWKRXJKVHYHUDOQRQ3&YHUVLRQVRI/LQX[

H[LVWPRVWH[LVWLQJLQVWDOODWLRQVRI/LQX[DUHRQ,QWHOFRPSDWLEOHKDUGZDUH

0DQ\XVHUVRI/LQX[KDYH/LQX[LQVWDOOHGDORQJZLWKDQRWKHURSHUDWLQJV\VWHP+DYLQJVHSDUDWHGLVN

SDUWLWLRQVIRU/LQX[DQG:LQGRZV'26LVFRPPRQ

7KH*QX&&RPSLOHU

7KHSRUWDELOLW\RIWKH8QL[RSHUDWLQJV\VWHPZDVSDUWO\DFRQVHTXHQFHRIWKHIDFWWKDWE\LWKDGEHHQ

UHZULWWHQLQDKLJKOHYHOODQJXDJH&7KH&ODQJXDJHZDVLQWXUQGHVLJQHGWREHDSRUWDEOHODQJXDJH

7KHILUVWQRQSURSULHWDU\YHUVLRQRI&ZDVGHYHORSHGE\5LFKDUG6WDOOPDQRIWKH)UHH6RIWZDUH)RXQGDWLRQ

,WVQDPHJQXZKLFKVWDQGVIRU*QX V1RW8QL[SURFODLPVLWVHVFDSHIURPSURSULHWDU\FRS\ULJKW

UHVWULFWLRQV7KHJQX&FRPSLOHULVZLGHO\XVHGQRWRQO\EHFDXVHLW VIUHHEXWEHFDXVHLWKDVVHWDVWDQGDUG

IRUUHOLDELOLW\7KH/LQX[RSHUDWLQJV\VWHPGHSHQGVKHDYLO\RQWKHJQX&FRPSLOHU

$FRPSLOHULVDSURJUDPZKLFKWUDQVODWHVDSURJUDPVXFKDVD&ODQJXDJHSURJUDPLQWRDPDFKLQHFRGH

SURJUDPWKDWFDQEHVWRUHGLQDFRPSXWHU VPHPRU\DQGUXQ$SURJUDPWKDWFDQEHVWRUHGLQPHPRU\DQG

UXQLVFDOOHGDQH[HFXWDEOHILOHRUVRPHWLPHVMXVWDQH[HFXWDEOH

7KHJQX&FRPSLOHUZRUNVLQVWDJHV6HH

)LJXUH

7RFRPSLOHDSURJUDPVXFKDV

SURJF

ZLWKWKHJQX

FRPSLOHURQHFDQHQWHUWKHFRPPDQG

)LJXUH6WDJHVRI*QX&&RPSLODWLRQ

OLQX[ER[JFFSURJF

7KLVFRPPDQGWDNHVWKHWUDQVODWLRQWKURXJKDOOWKHVWDJHVDQGSURGXFHVDQH[HFXWDEOHILOHFDOOHG

DRXW

7R

VWRSDWDQHDUOLHUVWDJHRQHFDQDGGDVZLWFKWRWKHJFFFRPPDQGOLQH)RUH[DPSOHWRSURGXFHDQDVVHPEO\

FRGHILOHWKH

6

VZLWFKXSSHUFDVHLVXVHG(QWHULQJWKHFRPPDQG

OLQX[ER[JFF6SURJF

\LHOGVDQDVVHPEO\ODQJXDJHILOH

SURJV

7RILQLVKWKHFRPSLODWLRQWKH

JFF

FRPPDQGPD\EHXVHGRQ

WKH

V

ILOH

OLQX[ER[JFFSURJV

7KH(GOLQDV$VVHPEOHU

7KHDVVHPEO\ODQJXDJHLQWKH

V

ILOHVSURGXFHGE\WKHJQXFRPSLOHULVGLIIHUHQWIURPWKHZLGHO\XVHG,QWHO

DVVHPEO\ODQJXDJHIRUWKH[SURFHVVRUV(GOLQDVDVVHPEO\ODQJXDJHLVHVVHQWLDOO\WKH,QWHODVVHPEO\

ODQJXDJH,WVREMHFWFRGHILOHVUXQXQGHU[/LQX[(GOLQDVLVDQLQWHUDFWLYHHQYLURQPHQWFRQVLVWLQJRIDQ

HGLWRUDQDVVHPEOHUDQGDVLPXODWRU

(GLWLQJ

6RXUFHFRGHHGLWLQJXVHVFRPPDQGVERUURZHGIURP('/,1D'26HGLWRU$PRQJWKHFRPPDQGVDUHLIRU

LQVHUWGIRUGHOHWHFIRUFKDQJHHIRUH[LWTIRUTXLWDQGKIRUKHOS&RPPDQGVDIIHFWWKHFXUUHQWOLQH

ZKLFKLVWKHOLQHWKDWKDVWKHDVWHULVN 7KHDVWHULVNLVPRYHGXVLQJWKHDUURZNH\V(QWHUHGOLQHVDUH

FKHFNHGE\WKHDVVHPEOHUIRUV\QWD[HUURUV

$VVHPEOLQJ

&RGHLVDVVHPEOHGDVLWLVHQWHUHGRUORDGHG$VVHPEO\FRGHDSSHDUVLQWKHGHIDXOWZLQGRZRQWKHULJKWVLGH

RIWKHVFUHHQ$VVHPEOHGFRGHFDQEHVDYHGDWDQ\WLPHXVLQJWKHRFRPPDQG

,QWHUSUHWLQJ

&RGHFDQEHH[HFXWHGHLWKHUIURPDORDGHGSURJUDPRUIURPDFRPPDQGSURPSWEHORZ

7RVWHSWKURXJKOLQHVRIFRGHWKHVSDFHEDULVXVHG7KHOLQHDERXWWREHH[HFXWHGLVGLVSOD\HGLQ\HOORZ,W

LVWKHOLQHSRLQWHGDWE\WKHLQVWUXFWLRQSRLQWHU7KHHQWHUNH\UHVHWVWKHLQVWUXFWLRQSRLQWHUWRWKHFXUUHQW

OLQH,QVWUXFWLRQVFDQWKHUHIRUHEHH[HFXWHGLQDQ\RUGHUE\PRYLQJWKHDVWHULVNDURXQG

7KHHVFDSHNH\EULQJVXSDFXUVRUDWWKHFRPPDQGSURPSWEHORZ&RPPDQGVKHUHDUHH[HFXWHG

LPPHGLDWHO\$QHPSW\FRPPDQGH[LWVWKHFRPPDQGOLQH

7RREVHUYHWKHHIIHFWVRIFRGHH[HFXWLRQYDULRXVDUHDVRIWKHPDFKLQHPD\EHEURXJKWLQWRYLHZLQWKHULJKW

SDQHORIWKHVFUHHQ7KHGLIIHUHQWFKRLFHVIRUWKHFRQWHQWVRIWKHULJKWSDQHOFDQEHF\FOHGWKURXJKXVLQJWKH

WDENH\

7KHOD\RXWRIWKH(GOLQDVVFUHHQZKLFKLVDGDSWHGIURPWKDWRIDQVLPXODWRUZULWWHQE\'DYH)HOWHULV

VKRZQLQ

)LJXUH



)LJXUH7KH(GOLQDV6FUHHQ

(GOLQDVLVD'26SURJUDP('/(;(

'RVHPX

7KH(GOLQDVDVVHPEOHULVD'26SURJUDP,I\RXKDYHDPDFKLQHZKLFKKDVD'26SDUWLWLRQWKHVLPSOHVW

ZD\RIJHWWLQJWR'26LVE\UHERRWLQJ%XWLWLVQRWQHFHVVDULO\WKHPRVWFRQYHQLHQW)XUWKHU\RXUPDFKLQH

PD\QRWKDYHD'26SDUWLWLRQ7KHGRVHPXSURJUDPPDNHVLWSRVVLEOHWRUXQ'26SURJUDPVIURP/LQX[,W

LVDYDLODEOHIURP

ZZZGRVHPXRUJ



7RUXQ(GOLQDVWKH

BJUDSKLFV

YDULDEOHLQ

GRVHPXFRQI

VKRXOGEHVHWWR

1$60

7KH1HWZLGH$VVHPEOHURU1$60LVDQRSHQVRXUFHDVVHPEOHUWKDWUXQVXQGHU/LQX[DVZHOODV'26,WV

XVHLVLQFUHDVLQJDQGKDVPXFKWRUHFRPPHQGLW,QSDUWLFXODUGXHWRLWVZLGHVSUHDGXVHLWKDVEHHQH[SRVHG

WRDYHU\WKRURXJKGHEXJJLQJ,WDOVRDFFHSWVDEURDGHUYRFDEXODU\RIDVVHPEO\ODQJXDJHLQVWUXFWLRQVWKDQ

GRHV(GOLQDV0RVWRIWKHSURJUDPVLQWKLVERRNPD\EHDVVHPEOHGXVLQJHLWKHUDVVHPEOHU(GOLQDVFDQEH

XVHGWRVWHSWKURXJKWKHH[DPSOHSURJUDPVLQWKHWH[WEXWIRUWKHELJJHUSURJUDPVVXFKDVWKHLQWHUUXSW

KDQGOHULQ

FKDSWHU

1$60LVGHILQLWHO\WKHEHWWHUFKRLFH1$60LVDQLQGXVWULDOVWUHQJWKDVVHPEOHU

7RXQSDFNWKHGLVWULEXWLRQZKLFKFRPHVZLWKWKLVERRNXVHWKHFRPPDQG

OLQX[ER[XQ]LSD/QDVPV]LS

DIWHUFRS\LQJLWWRDVXLWDEOHGLUHFWRU\7REXLOGLW\RXFDQWKHQFRS\WKHDSSURSULDWHPDNHILOH

OLQX[ER[FSPDNHILOHXQ[0DNHILOH

DQGUXQ

OLQX[ER[PDNH

2WKHU$VVHPEOHUV

0$60DQG7XUER$VVHPEOHUDUHDVVHPEOHUVWKDWKDYHEHHQYHU\ZLGHO\XVHGLQFRQQHFWLRQZLWK'267KH

IDFWWKDW:LQGRZVLVQRWVRHDV\WRZRUNZLWKXVLQJDVVHPEO\ODQJXDJHKDVOHGWRDGHFUHDVHLQWKH

SRSXODULW\RIWKHVHDVVHPEOHUV0DQ\SHRSOHKDYHWKHLPSUHVVLRQWKDW/LQX[LVQRWSDUWLFXODUO\DVVHPEOHU

IULHQGO\HLWKHU7KLVLPSUHVVLRQLVSDUWO\EDVHGRQWKHYLHZRIDVVHPEO\ODQJXDJHWKDW\RXJHWZRUNLQJZLWK

JFF7KRVHDFFXVWRPHGWR,QWHOV\QWD[PD\XQGHUVWDQGDEO\ILQGWKH$7 7V\QWD[DZNZDUG:RUVHZKHQ

DVVHPEO\ODQJXDJHLQVWUXFWLRQVDUHLQVHUWHGLQWR&FRGHWKHTXRWDWLRQPDUNVUHTXLUHGE\JFFDQGWKHOLQH

MXPEOLQJWKDWRFFXUVDUHSUHWW\UHSHOOHQW,KRSHWKDWE\

FKDSWHU

UHDGHUVZLOOEHSHUVXDGHGWKDWLQWHUDFWLQJ

ZLWK/LQX[XVLQJDVVHPEO\ODQJXDJHFDQEHFOHDQDQGQHDW

7KHUHDUHDIHZRWKHUDVVHPEOHUVDURXQG$EULHIGLVFXVVLRQRIWKHPFDQEHIRXQGLQDQ$VVHPEO\+2:72

DWWKH/LQX['RFXPHQWDWLRQ3URMHFW V:HEVLWH

ZZZOLQX[GRFRUJ+2:72



)XUWKHU5HDGLQJ

2SHQ6RXUFHV9RLFHVIURPWKH2SHQ6RXUFH5HYROXWLRQ&KULV'L%RQDHWDO2 5HLOO\

$4XDUWHU&HQWXU\RI8QL[3HWHU6DOXV$GGLVRQ:HVOH\

&KDSWHU3/$&(+2/',1*180(5$7,21

7KH(1,$&GLGQRWXVHWKHELQDU\V\VWHP,WVDULWKPHWLFSURFHVVRUXVHGYDFXXPWXEHVZLUHGWRJHWKHULQWR

ULQJVZKLFKZRUNHGOLNHROGGHVNWRSDGGLQJPDFKLQHZKHHOV7KHVHZHUHEDVHWHQFRQWUDSWLRQV6LQFHWKHQ

KRZHYHUDOOHOHFWURQLFFRPSXWHUVKDYHGRQHWKHLUDULWKPHWLFXVLQJWKHELQDU\V\VWHPEDVHWZR

&RQVHTXHQWO\GHVFULSWLRQVRIFRPSXWHUDULWKPHWLFDUHFXVWRPDULO\H[SUHVVHGXVLQJWKHELQDU\V\VWHPRU

UHODWHGV\VWHPVVXFKDVKH[DGHFLPDOEDVHVL[WHHQRURFWDOEDVHHLJKW$QXQGHUVWDQGLQJRIWKHVHQXPEHU

V\VWHPVLVHVVHQWLDO5HDGHUVDOUHDG\IDPLOLDUZLWKWKHPPD\SUHIHUWRVNLSWKLVFKDSWHU

7KH'HFLPDODQG3HQWLPDO6\VWHPV

%HIRUHWKHLQYHQWLRQRISODFHKROGLQJGHFLPDOQRWDWLRQLQWKH(DVWSUREDEO\LQ,QGLDRU&KLQDV\VWHPVRI

QRWDWLRQEXLOWDURXQGSRZHUVRIWHQZKLFKZHUHQRWSODFHKROGLQJV\VWHPVZHUHFRPPRQ7KHV\VWHPXVHG

E\$UFKLPHGHVIRUH[DPSOHLVVKRZQLQ

7DEOH

,QWKLVV\VWHP63$UHSUHVHQWVWKHQXPEHU*UHHN

OHWWHUVRIFRXUVHQRW/DWLQOHWWHUVZHUHXVHG7KHPRVWDSSDUHQWGLVDGYDQWDJHRIWKLVNLQGRIV\VWHPLV

FRPSXWDWLRQDO7KHQRWDWLRQLVQRKHOSDWDOOLQVHHLQJWKDW

7DEOH1RQ3ODFHKROGLQJ'HFLPDO6\VWHP

$



-



6



%



.



7



&



/



8



'



0



9



(



1



:



)



2



*



3



DQGDOOUHSUHVHQWHVVHQWLDOO\WKHVDPHEDVLFIDFW%XWWKLVLVRQO\DSUREOHPZKHQQRWDWLRQVWKHPVHOYHVDUH

XVHGWRGRFDOFXODWLRQVDVZHGRZLWKSHQFLODQGSDSHU:KHQFDOFXODWLRQVDUHGRQHZLWKSK\VLFDOWRNHQV

VXFKDVEHDGVRQDQDEDFXVRUZLWKSHEEOHVWKLVLVQRORQJHUDSUREOHP,QIDFWWKLVNLQGRIQRWDWLRQPD\

KDYHVHUYHGWRSUHYHQWUHDGLQJHUURUV$Q\RQHZKRKDVUHFHLYHGZKHQFDVKLQJDFKHFNZLOO

XQGHUVWDQGWKLVSRLQW

%XWZKHQWKHQRWDWLRQVWKHPVHOYHVDUHXVHGWRGRWKHFDOFXODWLRQVLWLVEHWWHUWRKDYHDQRWDWLRQDOV\VWHP

ZKLFKEULQJVRXWVXFKEDVLFVLPLODULWLHVDVWKHIROORZLQJ

3ODFHKROGLQJV\VWHPVGRWKLV3ODFHKROGLQJQXPHUDOVVRPHWLPHVOHVVV\PSDWKHWLFDOO\UHIHUUHGWRDV

KHDWKHQF\SKHUVZHUHSRSXODUL]HGLQ(XURSHDURXQGWKH\HDUE\/HRQDUGRRI3LVDDOVRNQRZQDV

)LERQDFFL)LERQDFFLZDVSUHVXPDEO\UHO\LQJRQDZRUNZULWWHQLQ$UDELFE\DO.KZkUL]PLZKRVHQDPHZH

VHHLQWKHZRUGDOJRULWKPDURXQGWKH\HDULQ%DJKGDG/LNHDOO(XURSHDQVFKRODUVRIWKHGD\)LERQDFFL

ZDVQHFHVVDULO\YHUVHGLQ$UDELF

$OOWKHQXPHUDWLRQV\VWHPVGLVFXVVHGLQWKLVERRNLQFOXGLQJWKHGHFLPDOV\VWHPZHXVHHYHU\GD\DUH

SODFHKROGLQJV\VWHPV%HIRUHSURFHHGLQJWRQRQGHFLPDOV\VWHPVOHWXVFRQVLGHUWKHUROHWKDWEDVHWHQSOD\V

LQWKH86PRQHWDU\V\VWHP

3XUHO\'HFLPDO0RQH\

7KHFXUUHQW86PRQHWDU\V\VWHPZDVDGRSWHGIROORZLQJWKHLQWURGXFWLRQRIWKHPHWULFV\VWHPLQ)UDQFHLQ

WKH5HYROXWLRQRI7KHSXUSRVHRIERWKRIWKHVHH[WHQVLRQVRIWKHGHFLPDOV\VWHPZDVWRVLPSOLI\

FDOFXODWLRQVE\EULQJLQJPRQHWDU\DQGPHDVXUHPHQWXQLWVLQWRKDUPRQ\ZLWKWKHGHFLPDOV\VWHPXVHGWR

UHSUHVHQWQXPEHUV

7REULQJWKHDOLJQPHQWRIWKHPRQHWDU\DQGQXPHUDOV\VWHPVLQWRVKDUSUHOLHIOHWXVLPDJLQHDSDUHGGRZQ

YHUVLRQRIWKH86PRQHWDU\V\VWHPWKDWLQFOXGHVRQO\SHQQLHVGLPHVELOOVGROODUELOOVGROODU

ELOOVGROODUELOOVDQGVRRQ

GLPH SHQQLHV

GROODUELOO GLPHV

 SHQQLHV

WHQGROODUELOO GROODUELOOV

 GLPHV

 SHQQLHV

DQGVRRQ

,QWKLVSXUHO\GHFLPDOPRQHWDU\V\VWHPHDFKGHQRPLQDWLRQH[FHSWSHQQLHVLVZRUWKH[DFWO\WHQWLPHVWKH

QH[WVPDOOHUXQLW'HQRPLQDWLRQVFRUUHVSRQGWRSODFHYDOXHVLQWKHEDVHWHQQXPHUDWLRQV\VWHPDQGYLFH

YHUVD3HQQLHVDUHRQHVGLPHVDUHWHQVGROODUVDUHKXQGUHGVHWF

7RFDUU\H[DFWFKDQJHIRUDQ\SRVVLEOHWUDQVDFWLRQLQWKLVEDUHERQHVPRQHWDU\V\VWHPRQHZRXOGQHHGQLQH

LWHPVRIHDFKGHQRPLQDWLRQ)RUH[DPSOHWRPDNHDSXUFKDVHZKRVHFRVWZDVRUFHQWVZRXOG

UHTXLUHWHQGROODUELOOVGROODUELOOVGLPHVDQGSHQQLHV

,IZHDFWXDOO\XVHGWKLVV\VWHPRXUFKDQJHSXUVHVZRXOGQHHGWREHEXONLHUWKDQWKH\DUH7KHH[LVWHQFHRI

+



4



,



5



QLFNHOVTXDUWHUVHWFUHGXFHVWKHDPRXQWRIFKDQJHZHPXVWFDUU\7RJHWDOHVVEXON\V\VWHPZKLFKZDV

QRQHWKHOHVVEDVHGRQVLPSOHPXOWLSOHVZHFRXOGLPDJLQHDV\VWHPEDVHGRQILYHVLQVWHDGRIWHQV

3HQWLPDO0RQH\

6XSSRVHZHLPDJLQHDPRQHWDU\V\VWHPZKRVHGHQRPLQDWLRQVDUHSHQQLHVQLFNHOVTXDUWHUVELOOV

ELOOVDQGVRRQ,QWKLVV\VWHPWKHYDOXHRIHDFKGHQRPLQDWLRQH[FHSWSHQQLHVLVH[DFWO\ILYHWLPHVWKH

YDOXHRIWKHQH[WVPDOOHUGHQRPLQDWLRQ/HW VFDOOFHQWVD%LJ'ROODUDQGLPDJLQHWKDWWKHFXUUHQF\IRU

LWLVDELOOZLWKDELJRQLW

QLFNHO SHQQLHV

TXDUWHU QLFNHOV

 SHQQLHV

%LJ'ROODU TXDUWHUV

 QLFNHOV

 SHQQLHV

DQGVRRQ

7REHSUHSDUHGWRFDUU\RXWDQ\WUDQVDFWLRQLQWKLVV\VWHPZHZRXOGQHHGWRFDUU\RQO\IRXULWHPVRIHDFK

XQLW7KLVZRXOGFUHDWHOHVVEXONLQRXUFKDQJHSXUVHV%XWORRNZKDWZRXOGKDSSHQWRWKHDULWKPHWLF7R

PDNHDSXUFKDVHRIZRXOGUHTXLUH

RQHELOO 

IRXUELOOV 

]HURELOOV 

WZRTXDUWHUV 

]HURQLFNHOV 

WKUHHSHQQLHV 



 

7KLVDULWKPHWLFLVQRORQJHUWUDQVSDUHQWO\REYLRXVDVLWLVZKHQZHKDYHGHFLPDOPRQH\7KLVLVWUXHGHVSLWH

WKHIDFWWKDWWKLVSHQWLPDOPRQHWDU\V\VWHPLVMXVWDVVLPSOHDVWKHGHFLPDOPRQHWDU\V\VWHP7KHGHFLPDO

PRQHWDU\V\VWHPDSSHDUVWREHVLPSOHUEHFDXVHLWPDWFKHVRXUGHFLPDOQXPHUDWLRQV\VWHP+RZHYHULIZH

XVHGDSHQWLPDOQXPHUDWLRQV\VWHPDVZHOODVSHQWLPDOPRQH\V\VWHPVLPSOLFLW\ZRXOGUHWXUQ(YHU\

PRQHWDU\XQLWZRXOGFRUUHVSRQGWRDSODFHYDOXHLQWKHSHQWLPDOQXPHUDWLRQV\VWHPDQGYLFHYHUVD

3HQWLPDO1XPHUDOV

7KHSODFHYDOXHVLQWKHSHQWLPDOQXPHUDOV\VWHPDUHRQHILYHWZHQW\ILYHRQHKXQGUHGWZHQW\ILYHHWF

(DFKYDOXHLVZRUWKILYHRIWKHQH[WVPDOOHU

$Q\QXPEHUFDQEHUHSUHVHQWHGXVLQJDWPRVWIRXURIDQ\RQHSODFHYDOXH6RWKHGLJLWVDQGDUH

QRWXVHG$OOQXPEHUVDUHUHSUHVHQWHGXVLQJRQO\WKHQXPHUDOVDQG

7KHSHQWLPDOLVWKHVDPHDVWKHRUGLQDU\GHFLPDO,WPHDQVILYHVDQGRQHVOLNHQLFNHOVDQG

SHQQLHV6LPLODUO\LVWKHVDPHDVLQEDVHWHQ,QFHQWVLWPHDQVTXDUWHUQLFNHOVDQGSHQQLHV

&RXQWLQJJRHVOLNHWKLV

DQGVRRQ8VLQJSHQWLPDOQXPHUDWLRQWRGHVFULEHSHQWLPDOPRQH\ZH

JHWWKLVWDEOH

QLFNHO SHQQLHV ILYH

TXDUWHU QLFNHOV

 SHQQLHV WZHQW\ILYH

%LJ'ROODU TXDUWHUV

 QLFNHOV

 SHQQLHV RQHKXQGUHGWZHQW\ILYH

3HQWLPDO$ULWKPHWLF

*LYHQDEDVHILYHDULWKPHWLFSUREOHP

ZHKDYHDFKRLFHRIPHWKRGV:HFDQFRQYHUWWKHVHQXPEHUVLQWREDVHWHQGRWKHDULWKPHWLFDQGWKHQ

FRQYHUWEDFNWREDVHILYH2UZHFDQGRWKHSUREOHPZLWKRXWDQ\FRQYHUVLRQVXVLQJWKHQDWLYHDULWKPHWLF

7KHILUVWPHWKRGLVHDVLHUDWILUVWVLQFHZHDUHXVHGWREDVHWHQ7KLQNLQJLQWHUPVRIPRQHWDU\XQLWVLV

IRXUTXDUWHUVWZRQLFNHOVDQGWKUHHSHQQLHVLHFHQWVLQRUGLQDU\EDVHWHQ6LPLODUO\LVFHQWVLQ

RUGLQDU\EDVHWHQ6RZHFDQGRWKHDGGLWLRQXVLQJRUGLQDU\EDVHWHQDULWKPHWLF

2QHKXQGUHGWKLUWHHQSOXVLVRU7RFRQYHUWEDFNVWDUWE\WDNLQJRXWRQHELJGROODUDGROODU

DQGDTXDUWHUDQGZHKDYHFHQWVOHIW7KLVLVWKUHHTXDUWHUVRQHQLFNHODQGWZRSHQQLHV6RWKHDQVZHULV



7DEOH3HQWLPDO6\VWHP3ODFH9DOXHV

V

V

V

3HQWLPDO

'HFLPDO



































































































































































































































































































1DWLYH$GGLWLRQ

8VLQJWKHQDWLYHDULWKPHWLFKRZHYHULVHDVLHUWKDQWKLVHVSHFLDOO\ZKHQWKHQXPEHUVJHWODUJHU$ERXWDOO

WKDW VQHFHVVDU\WRUHPHPEHULVWKDWILYHRIDQ\RQHXQLWPXVWEHFDUULHGE\FRQYHUWLQJLWWRRQHRIWKHQH[W

ODUJHUXQLW

7KHRQHVRUSHQQLHVFROXPQWRWDOVVHYHQZKLFKLVZKLFKLVFDUU\

LVVL[ZKLFKLVZKLFKLVFDUU\

$QGLVHLJKWZKLFKLVZKLFKLVFDUU\

&OHDUO\WKHQDWLYHDULWKPHWLFLVHDVLHURQFHZHXQGHUVWDQGLW

1DWLYH6XEWUDFWLRQ

6XEWUDFWLRQUHTXLUHVERUURZLQJIRUH[DPSOHFRQYHUWLQJDTXDUWHUWRILYHQLFNHOVRUDQLFNHOWRILYHSHQQLHV

7KHIROORZLQJVXEWUDFWLRQRIWKUHHIURPWHQLOOXVWUDWHVERUURZLQJ

%RUURZDQLFNHOIURPWKHQLFNHOVFROXPQDQGFRQYHUWLWLQWRILYHSHQQLHV









































2QHQLFNHOLVOHIW

6RZHJHWRQHQLFNHODQGWZRSHQQLHVOHIW

&RQYHUVLRQWR3HQWLPDO

6RPHWLPHVFRQYHUVLRQVDUHXQDYRLGDEOH)RUDFRPSXWHUWREHDEOHWRVWRUHDQXPEHULQELQDU\ZKLFKLV

LQSXWLQGHFLPDODFRQYHUVLRQLVQHHGHG$OWKRXJKFRQYHUVLRQVFDQEHGRQHE\VHDUFKLQJIRUD

UHSUHVHQWDWLRQZKLFKZRUNVWKHUHDUHPRUHHIILFLHQWPHWKRGV&RQVLGHUWKHFRQYHUVLRQRILQWREDVHILYH

7RXQGHUVWDQGWKLVFRQYHUVLRQLWPD\KHOSWRORRNDWWKHDQVZHUEHIRUHZHVWDUW

:HFDQVHHWKDWFDQEHIDFWRUHGRXWRIWKLVVXPH[FHSWIRUWKHDWWKHHQG

%XWWKLVMXVWVD\VZKDWWKHTXRWLHQWDQGUHPDLQGHURIGLYLGHGE\DUH1RWLFHWKDWWKHUHPDLQGHULVRXU

XQLWVGLJLW)XUWKHUPRUHZHFDQFDOFXODWHWKLVTXRWLHQWDQGUHPDLQGHUXVLQJEDVHWHQZKLFKLVZKDWZHKDYH

DYDLODEOHZKHQZHVWDUWWKLVFRQYHUVLRQ

:HKDYHLQEDVHWHQWKDW

ZKHUHDJDLQSHHNLQJDWWKHDQVZHUVKRZVXVWKDW

7KHTXRWLHQWFRQWDLQVWKHLQIRUPDWLRQQHHGHGWRJHWDOOWKHRWKHUGLJLWV7KH\FDQEHREWDLQHGXVLQJ

PRUHGLYLVLRQV

7KHODVWGLYLVLRQKDVD]HURTXRWLHQW

7KHDOJRULWKPIRUFRQYHUVLRQFRQVLVWVRIUHSHDWHGGLYLVLRQE\HDFKUHPDLQGHU\LHOGLQJDGLJLWRIWKH

DQVZHU,WSURFHHGVXQWLOD]HURTXRWLHQWLVREWDLQHG

7KH%LQDU\6\VWHP

.QRZLQJWKHELQDU\V\VWHPLVLPSRUWDQWEHFDXVHWKHQDWLYHDULWKPHWLFRIDOOH[LVWLQJFRPSXWHUSURFHVVRUVLV

ELQDU\DULWKPHWLF

%LQDU\QXPEHUVXVHRQO\WZRGLJLWVDQG$OOELQDU\QXPEHUVDUHFRQVWUXFWHGIURPMXVWWKHVHWZRGLJLWV

&RXQWLQJJRHVOLNHWKLV

HWF

7KHELQDU\V\VWHPLVDSODFHKROGLQJV\VWHP(DFKSRVLWLRQH[FHSWIRUWKHRQHVSRVLWLRQVWDQGVIRUDXQLW

ZKLFKLVWZLFHWKHYDOXHRIWKHQH[WVPDOOHUXQLW6HH

7DEOH



%LQDU\$GGLWLRQ

6XSSRVHZHZDQWWRDGG

ZKLFKLVWKLUWHHQSOXVVL[7KHILUVWFROXPQGRHVQRWUHTXLUHDFDUU\

1HLWKHUGRHVWKHVHFRQG

7KHWKLUGFROXPQWRWDOVWZRZKLFKLVZKLFKLVFDUU\

7KHIRXUWKFROXPQDOVRWRWDOVWZRZKLFKLVDJDLQFDUU\

7KLVLVH[DFWO\KRZDFRPSXWHUDGGVWKLUWHHQDQGVL[:HFDQFKHFNWKDWWKHUHVXOWLVQLQHWHHQ

î 

î 

î 

î 

î 





7DEOH%LQDU\6\VWHP3ODFH9DOXHV

V

V

V

V

V

V

%LQDU\

'HFLPDO

















































































































































































































































































































































































































































































%LQDU\6XEWUDFWLRQ

6XSSRVHZHZDQWWRVXEWUDFWILYHIURPWZHOYH

,WUHTXLUHVERUURZLQJ

'RLQJWKHVXEWUDFWLRQLQWKHILUVWFROXPQ\LHOGV

,QWKHWZR VFROXPQZHVXEWUDFW]HURIURPRQH

7KHIRXUVFROXPQUHTXLUHVDQRWKHUERUURZLQJ

7KLVLVKRZWRVXEWUDFWILYHIURPWZHOYHLQELQDU\%XWLWLVQRWDWDOOKRZFRPSXWHUVGRWKLVDULWKPHWLF

&RPSXWHUVGRVXEWUDFWLRQVXVLQJQHJDWLYHVOLNHWKLV

6LQFHWKHPHWKRGWKDWZHOHDUQHGLQVFKRROIRUDGGLQJDQHJDWLYHZDVWRFRQYHUWLWWRDVXEWUDFWLRQWKLV

PLJKWVHHPWREHDGLVWLQFWLRQZLWKRXWDGLIIHUHQFH+RZHYHUFRPSXWHUVXVHDGLIIHUHQWUHSUHVHQWDWLRQIRU

QHJDWLYHVWKDQMXVWVWLFNLQJDPLQXVVLJQLQIURQWRIWKHQXPEHUVRWKHUHUHDOO\LVDGLIIHUHQFH

5HSUHVHQWDWLRQRIQHJDWLYHQXPEHUVLVGLVFXVVHGLQ

FKDSWHU



VHFWLRQ



































































&RQYHUVLRQWR%LQDU\

)LUVWZHREVHUYHWKDWZHFDQGHWHUPLQHZKHWKHUDQ\ELQDU\QXPEHULVHYHQRURGGE\H[DPLQLQJLWVRQHV

GLJLW)RUH[DPSOHLVRGGDQGLWVELQDU\UHSUHVHQWDWLRQHQGVLQD

)XUWKHU

6RLIZHDUHZRUNLQJZLWKQLQHWHHQXVLQJEDVHWHQZHKDYH

6XSSRVHZHFRQYHUWWRELQDU\7KHLQWKHDERYHHTXDWLRQLVWKHXQLWVGLJLWRI VELQDU\IRUP:HJRW

WKHE\GLYLGLQJE\

5HSHDWLQJWKHSURFHVVDQGZULWLQJGRZQWKHUHPDLQGHUHDFKWLPHJLYHVXVWKHUHVWRIWKHGLJLWV

7KHFRQYHUVLRQLVGRQHE\GLYLGLQJE\UHSHDWHGO\(DFKUHPDLQGHUIXUQLVKHVRQHELQDU\GLJLW

0HPRU\DVD5HFWDQJOHRI%LWV

2QDOOHOHFWURQLFFRPSXWHUVPDLQPHPRU\LVRUJDQL]HGDVDUHFWDQJOHRIELWV

)LJXUH

VKRZVDWLQ\VL[ELW

E\IRXUELWPHPRU\$VVKRZQLQWKHILJXUHPHPRU\LVGLYLGHGZLGWKZLVHLQWRURZV(DFKURZLVFDOOHGD

ZRUG7UDQVIHUVRIGDWDWRDQGIURPFRPSXWHUPHPRU\DUHGRQHDZRUGDWDWLPHRULQPXOWLSOHVRIZRUGV

)LJXUH0HPRU\ZLWK6L[)RXU%LW:RUGV

7KHQXPEHURIELWVLQDZRUGLVFDOOHGWKHZRUGVL]H7KHZRUGVL]HRIWKHPHPRU\LQ

)LJXUH

LVIRXUELWV

$FRPSXWHUZLWKVXFKDPHPRU\ZRXOGEHVDLGWRKDYHIRXUELWZRUGV(DFKZRUGLQWKLVPHPRU\KROGVD

QXPEHUUHSUHVHQWDEOHLQIRXUELQDU\GLJLWVLHDQXPEHUIURPWKURXJK6RIRUH[DPSOHDSURFHVVRU

UHTXHVWLQJWKHZRUGORFDWHGDWWKHDGGUHVVZRXOGEHJLYHQWKHQXPEHU:KHQGHVLJQLQJDFKHVVSOD\LQJ

FRPSXWHUIRUH[DPSOHLWPLJKWEHDJRRGLGHDWRXVHELWZRUGVRQHELWIRUHDFKORFDWLRQRQWKHFKHVV

ERDUG

:RUGVLQFRPSXWHUPHPRU\DUHQXPEHUHGFRQVHFXWLYHO\VWDUWLQJIURP]HUR7KHVHQXPEHUVDUHFDOOHG

DGGUHVVHV,Q

)LJXUH

WKHDGGUHVVHVDUHWKHLQWHJHUVIURPWKURXJK$FRPSXWHUZLWKQZRUGVZLOO

KDYHDGGUHVVHVIURPWKURXJKQ:KHQUHTXHVWLQJGDWDWUDQVIHUVLQWRRURXWIURPPHPRU\FRPSXWHU

SURFHVVRUVXVHDGGUHVVHVWRVSHFLI\ZKLFKGDWDZRUGVDUHWREHWUDQVIHUUHG

7KHWRWDOFDSDFLW\RIDFRPSXWHUPHPRU\LVWKHQXPEHURIZRUGVLQWKHPHPRU\WLPHVWKHZRUGVL]HOHQJWK

WLPHVZLGWK7KHOLWWOHPHPRU\LQ

)LJXUH

KDVDFDSDFLW\RIELWV0HPRU\FDSDFLW\LVRIWHQPHDVXUHG

LQE\WHVLQVWHDGRIELWV2QHE\WHRIPHPRU\LVWKHVDPHDVHLJKWELWV

&RPSXWHUVEDVHGRQ,QWHOSURFHVVRUVXVHHLJKWELWZRUGV$ZDUQLQJQRWHLVLQRUGHUKHUH%HFDXVH

GRFXPHQWDWLRQIURP,QWHODQG0LFURVRIWXVHWKHWHUPZRUGWRUHIHUWRDELWREMHFWWKLVXVDJHKDVEHFRPH

IDLUO\VWDQGDUG7KLVLVXQIRUWXQDWH,WLVEHWWHUWROHDYHWKHWHUPZLWKLWVPDFKLQHGHSHQGHQWPHDQLQJ,QDQ\

FDVHWKHQXPEHURIE\WHVLQWKHPHPRU\RIDQ,QWHOEDVHGPDFKLQHLVWKHVDPHDVWKHQXPEHURIDGGUHVVHV

%HFDXVHWKHQXPEHURIZRUGVLQDFRPSXWHUPHPRU\LVW\SLFDOO\DODUJHSRZHURIWZRRUDVPDOOPXOWLSOH

WKHUHRIVHYHUDOQDPHVIRUWKHVHODUJHSRZHUVRIWZRKDYHEHHQDGDSWHGIURPWKHPHWULFV\VWHP)RU
H[DPSOH



LVDQGLVDSSUR[LPDWHO\,QWKHPHWULFV\VWHPWKHOHWWHU.IURPNLORLVXVHGWR

VWDQGIRU,QUHIHUHQFHWRFRPSXWHUPHPRU\NLORPHDQV2WKHUPHWULFSUHIL[HVZKLFKKDYHEHHQ

DGDSWHGDUHVKRZQLQWKHIROORZLQJWDEOH

7KHXVHRIWKHDSSUR[LPDWHHTXDOLWLHVLQWKLVWDEOHPDNHVSRVVLEOHVLPSOLILHGFRPSXWDWLRQVLQYROYLQJODUJH

([DFW9DOXH

6\PERO

3UHIL[

$SSUR[LPDWH9DOXH







.

NLOR

WKRXVDQG







0

PHJD

PLOOLRQ







*

JLJD

ELOOLRQ







7

WHUD

WULOOLRQ

/DUJH3RZHUVRI7ZR

SRZHUVRIWZR)RUH[DPSOHWKHPD[LPXPPHPRU\FDSDFLW\RIDQ,%0$7FRPSXWHULV



E\WHVRI

PHPRU\7RH[SUHVVWKLVDPRXQWLQPRUHIDPLOLDUWHUPVZHPD\EUHDNGRZQ



DVIROORZV

7KLVLVDSSUR[LPDWHO\PLOOLRQE\WHV6LQFH



 .î. 0HJWKHH[DFWDPRXQWRIPHPRU\LVO

0HJDE\WHVRUE\WHV

7KH+H[DGHFLPDO6\VWHP

%DVHVL[WHHQLVLPSRUWDQWEHFDXVHLWLVHDVLHUWRUHDGDQGZULWHWKDQELQDU\EXWLVQRQHWKHOHVVUHDGLO\

FRQYHUWLEOHWRDQGIURPELQDU\

%DVHVL[WHHQLVDOVRWKHILUVWEDVHZHKDYHFRQVLGHUHGZKLFKLVJUHDWHUWKDQWHQ,QVWHDGRISXWWLQJVRPH

QXPHUDOVRXWRIZRUNEDVHVL[WHHQUHTXLUHVWKHHPSOR\PHQWRIDGGLWLRQDOQXPHUDOV6LQFHQXPHUDOVDUH

QHHGHGIRUDOOQXPEHUVOHVVWKDQVL[WHHQWKLVPHDQVSRVLWLRQVDUHRSHQIRUWKHQXPEHUVWHQHOHYHQWZHOYH

WKLUWHHQIRXUWHHQDQGILIWHHQ,WLVWKHFXVWRPWRILOOWKHVHSRVLWLRQVZLWKWKHOHWWHUV$%&'(DQG)

6RLQEDVHVL[WHHQFRXQWLQJJRHVOLNHWKLV$%&'()

$%&'()DQGVRRQ6HH

7DEOH



7DEOH+H[DGHFLPDO6\VWHP3ODFH9DOXHV

V

V

+H[DGHFLPDO

'HFLPDO











































































$

$





%

%





&

&





'

'





(

(





)

)





















































































$

$





%

%





&

&





'

'



7KHUHLVYDOXHLQEHLQJDEOHWRDGGDQGVXEWUDFWLQKH['HEXJJHUVJHQHUDOO\GLVSOD\UHJLVWHUVLQKH[DQGLW

LVKDQG\WREHDEOHWRFKHFNWKHDULWKPHWLFEHLQJGLVSOD\HGZLWKRXWKDYLQJWRFRQYHUWEDFNWREDVHWHQ

$GGLWLRQDQGVXEWUDFWLRQDUHHDV\WRGRLQKH[LIZHUHPHPEHUWKDWFDUU\LQJDQGERUURZLQJDUHGRQHZLWK



$GGLWLRQLQ+H[

7RDGG

ZHVWDUWZLWKWZHOYHSOXVHLJKWZKLFKLVWZHQW\ZKLFKLV+ZKLFKLVFDUU\

SOXVHOHYHQSOXVVHYHQLVQLQHWHHQZKLFKLV+ZKLFKLVFDUU\

$ HLJKWHHQZKLFKLV+ZKLFKLVFDUU\

)LQDOO\ 

6XEWUDFWLRQLQ+H[

7RVXEWUDFW



(

(





)

)



















ZHVWDUWE\ERUURZLQJ

&²(LVWZHQW\HLJKWPLQXVIRXUWHHQZKLFKLVIRXUWHHQ

$²LVWHQPLQXVIRXULV

$JDLQERUURZLQJ

$LVWZHQW\WKUHHPLQXVWHQZKLFKLVWKLUWHHQRU'

)LQDOO\ 

&RQYHUVLRQWR+H[

7RFRQYHUWDQXPEHULQWREDVHVL[WHHQZHFDQGLYLGHE\DVPDQ\WLPHVDVQHFHVVDU\6XSSRVHZHFRQYHUW

LQWRKH[DGHFLPDO

7RGHPRQVWUDWHWKHHDV\FRQYHUWLELOLW\RIEDVHWZRLQWREDVHVL[WHHQZHDJDLQFRQVLGHUWKHQXPEHU

RQO\WKLVWLPHZHFRQYHUWLWLQWREDVHWZR

7KHIDFWWKDWGLYLGLQJE\IRXUWLPHVLVHVVHQWLDOO\WKHVDPHWKLQJDVGLYLGLQJE\VXJJHVWVWKDWIRXU

VWDJHVRIWKLVFRQYHUVLRQPXVWFRUUHVSRQGWRRQHVWDJHRIKH[DGHFLPDOFRQYHUVLRQ,IZHJURXSWKHELQDU\

GLJLWVLQWRIRXUVZHGRLQIDFWREVHUYHWKLVUHODWLRQVKLS

7KHVHOXPSVRIIRXUGLJLWVZKHQWUHDWHGDVLQGLYLGXDOQXPEHUVDQGJLYHXVWKH

KH[DGHFLPDOGLJLWV(DQG7KLVLVWKHEDVHVL[WHHQUHSUHVHQWDWLRQRIRQHWKRXVDQG,WLVFOHDUKRZWR

FRQYHUWLQWKHRWKHUGLUHFWLRQDVZHOO7KHFRQYHUVLRQEHWZHHQWKHWZRLVHDV\HQRXJKWKDWLWFDQEHGRQH

ZLWKRXWWKLQNLQJ6HH

7DEOH

7KLVPDNHVLWSRVVLEOHWRXVHKH[DGHFLPDODVDKXPDQUHDGDEOHIRUPRI

ELQDU\DNLQGRIKLJKOHYHOPDFKLQHODQJXDJH&RQVLGHUWKHIROORZLQJWZRUHSUHVHQWDWLRQVRIWKHVDPH

QXPEHU









(





















%











$





6XSSRVH\RXKDGWRUHDGRQHRIWKHVHWRDKDUGZDUHVXSSRUWSHUVRQRYHUWKHSKRQHRUFRS\LWRQWRD

SRVWFDUG,VWKHUHDQ\GRXEWWKDWXVLQJKH[ZRXOGEHHDVLHUDQGOHVVOLDEOHWRHUURU"

&RPSXWHUSURJUDPVRULJLQDOO\FRQVLVWHGRIOLQHDIWHUOLQHRIELQDU\FRGH7KHUHLVDELWWHUVZHHWLURQ\KHUH

)LOOLQJRXWFRGLQJVKHHWVZLWK]HURVDQGRQHVZDVDMREW\SLFDOO\GRQHE\ZRPHQ$VDUHVXOWPDQ\ZRPHQ

JRWLQRQWKHYHU\EHJLQQLQJRIWKHFRPSXWHUSURJUDPPLQJILHOG

:K\QRW2FWDO"

2FWDOQXPEHUVFDQEHFRQYHUWHGEDFNDQGIRUWKIURPELQDU\LQWKHVDPHZD\DVKH[QXPEHUVPHUHO\

JURXSLQJE\WKUHHVLQVWHDGRIIRXUV2FWDODOVRKDVWKHDGYDQWDJHRYHUKH[LQWKDWQRDOSKDEHWLFQXPHUDOVDUH

QHHGHG+RZHYHUWKHLQFUHDVLQJO\ZLGHVSUHDGXVHRIWKHE\WHDVWKHIXQGDPHQWDOXQLWRIPHPRU\KDVOHGWR

DGHFUHDVHLQWKHLPSRUWDQFHRIRFWDO

%DVH'LVWLQJXLVKLQJ1RWDWLRQV

6LQFHDOOWKHGLJLWVLQGHFLPDODUHYDOLGLQKH[DGHFLPDOLWLVQRWSRVVLEOHWRGHWHUPLQHZLWKRXWDGGLWLRQDO

LQIRUPDWLRQZKHWKHUQXPHUDWLRQVXFKDVLVLQWHQGHGDVGHFLPDORUKH[$FRPPRQFRQYHQWLRQIRU

LQGLFDWLQJKH[DGHFLPDOLVWKHXVHRIDQDSSHQGHG+:KHQWKLVFRQYHQWLRQLVXVHG  MXVWPHDQVILIW\EXW

+ PHDQVILIW\LQKH[LHHLJKW\2FFDVLRQDOO\SDUWLFXODUO\ZLWKDVVHPEOHUV%DQG'DUHDSSHQGHGWR

LQGLFDWHELQDU\DQGGHFLPDO$SSHQGLQJ2IRURFWDOZRXOGREYLRXVO\QRWEHDJRRGLGHD,QWKH&ODQJXDJH

RFWDOLVLQGLFDWHGE\SUHSHQGLQJD



DQGKH[DGHFLPDOLVLQGLFDWHGE\SUHSHQGLQJD

[

7KLVERRNSODFHV

SULPDU\UHOLDQFHRQGHFLPDOKH[DGHFLPDODQGELQDU\QXPHUDWLRQ7RGLVWLQJXLVKWKHVHEDVHVWKHIROORZLQJ

FRQYHQWLRQVZLOOEHXVHG

z

+H[DGHFLPDOH[FHSWLQ&SURJUDPVZLOODOZD\VEHLQGLFDWHGE\DQDSSHQGHG+,QDGGLWLRQEHFDXVH

RIDSUREOHPGLVFXVVHGLQ

VHFWLRQ

KH[QXPHUDWLRQXVHGLQWKHDVVHPEO\ODQJXDJHZLOODOVRKDYHD

SUHSHQGHG

z

%LQDU\ZLOOEHLQGLFDWHGE\JURXSLQJGLJLWVLQWRFOXPSVRIIRXUVHSDUDWHGE\VSDFHV

z

%DVHWHQQXPHUDWLRQLVWKHGHIDXOW,WLVDVVXPHGIRUDOOQXPHUDWLRQZKRVHEDVHLVQRWRWKHUZLVH

LQGLFDWHG

 )UDFWLRQVLQ2WKHU%DVHV

7DEOH+H[%LQDU\&RQYHUVLRQ

%LQDU\

+H[DGHFLPDO

'HFLPDO































































$





%





&





'





(





)



0XFKFRPSXWDWLRQLQYROYLQJIUDFWLRQVLVGRQHXVLQJVFLHQWLILFQRWDWLRQ%HFDXVHVFLHQWLILFQRWDWLRQLQYROYHV

ERWKGHFLPDOIUDFWLRQVDQGH[SOLFLWSRZHUVRIWHQLWDOORZVIRUIUHHGRPLQWKHORFDWLRQRIWKHGHFLPDOSRLQW

)RUH[DPSOH

&RQVHTXHQWO\VFLHQWLILFQRWDWLRQLVVRPHWLPHVUHIHUUHGWRDVIORDWLQJSRLQWQRWDWLRQ7KHIORDWLQJSRLQW

SURSHUW\RIWKHUHSUHVHQWDWLRQLVDUHVXOWRIWKHIDFWWKDWDOOSDUWVRIWKHUHSUHVHQWDWLRQLQFOXGLQJWKH

IUDFWLRQDOSDUWXVHSRZHUVRIWHQ,QRUGHUWRWDNHDGYDQWDJHRIWKHIORDWLQJSRLQWSURSHUW\LQFRPSXWHU

FRPSXWDWLRQVZKLFKXVHWKHELQDU\V\VWHPDOOIUDFWLRQVDQGH[SOLFLWSRZHUVPXVWEHELQDU\LQVWHDGRI

GHFLPDO

1RQGHFLPDOSODFHKROGLQJIUDFWLRQVZHUHXVHGE\WKH%DE\ORQLDQVDQGSHUVLVWWRGD\LQRXUWLPHDQGDQJOH

XQLWV\VWHPVZKHUHZHVHHPLQXWHVDQGVHFRQGVDVEDVHIUDFWLRQV

'HFLPDOIUDFWLRQVRIFRXUVHDUHRXUHYHU\GD\VWDQGDUG)RUH[DPSOH

:HILQGWKLVEDVHWHQIUDFWLRQXVLQJORQJGLYLVLRQ

6XSSRVHZHZDQWWRILQGRQHHLJKWKDVDSHQWLPDOIUDFWLRQ:HFDQXVHORQJGLYLVLRQLQEDVHILYHXVLQJWKH

SHQWLPDOPXOWLSOLFDWLRQWDEOHZKHUHQHFHVVDU\7KHSHQWLPDOUHSUHVHQWDWLRQRIHLJKWLV

7KLVLVDUHSHDWLQJIUDFWLRQVLPLODUWR

LQWKHGHFLPDOV\VWHP6RRQHHLJKWKLQWKHSHQWLPDO

V\VWHPLV

DQLQILQLWHO\UHSHDWLQJIUDFWLRQ,WVPHDQLQJUHSUHVHQWHGXVLQJRUGLQDU\GHFLPDOQRWDWLRQLVWKDW

,IZHXVHORQJGLYLVLRQWRJHWWKHKH[DGHFLPDOIUDFWLRQZHJHWDILQLWHUHSUHVHQWDWLRQ

7KLVLVFHUWDLQO\FRUUHFWVLQFH

,QEDVHWZRWKHVDPHGLYLVLRQORRNVOLNHWKLV

7KLVLVFRUUHFWVLQFH

,QHDUO\,QWHOV\VWHPVFRPSXWDWLRQVEDVHGRQIORDWLQJSRLQWQXPEHUVZHUHGRQHRQVHSDUDWHSURFHVVRUVVXFK

DVWKH6LQFHWKHWKHVHIORDWLQJSRLQWXQLWVZHUHLQFRUSRUDWHGLQWRWKHPDLQSURFHVVRU,Q&D

SURJUDPPHUPD\VHQGFRPSXWDWLRQVWRWKHIORDWLQJSRLQWXQLWE\XVLQJDIORDWLQJSRLQWGDWDW\SHVXFKDV

GRXEOH

 &RQYHUWLQJ)UDFWLRQV

,QWKHSUHYLRXVVHFWLRQZHXVHGORQJGLYLVLRQWRILQGDSODFHKROGLQJIUDFWLRQJLYHQWKHQXPHUDWRUDQG

GHQRPLQDWRUDVLQWHJHUV)RUH[DPSOHWRILQGDEDVHWZRSODFHKROGLQJIUDFWLRQZHFRXOGGRORQJGLYLVLRQ

LQEDVHWZR,IZHDUHJLYHQLQVWHDGDSODFHKROGLQJIUDFWLRQLQVRPHRWKHUEDVHZHFDQXVHDPXOWLSOLFDWLYH

SURFHVVWRGRWKHFRQYHUVLRQ)RUH[DPSOHVXSSRVHZHDUHJLYHQWKHGHFLPDOIUDFWLRQ«DQGZH

ZLVKWRFRQYHUWWKDWLQWRDELQDU\IUDFWLRQ/HWE



E



E



«EHWKHXQNQRZQGLJLWVLQRXUELQDU\IUDFWLRQ

,IZHXVHWKHHTXDOLW\

ZHFDQGHWHUPLQHWKHLUYDOXHVDVIROORZV6XSSRVHZHGRXEOHERWKVLGHVRIWKLVHTXDWLRQ

7KHLQWHJHUSDUWVRIERWKVLGHVPXVWDJUHH7KHLQWHJHUSDUWRIWKHOHIWVLGHLV]HURVRE



 +HQFHZHKDYH

RXUILUVWGLJLWDQGZHDOVRKDYHWKHHTXDWLRQ

,IZHGRXEOHWKLVHTXDWLRQZHJHW

$JDLQWKHLQWHJHUSDUWVRIERWKVLGHVPXVWDJUHHVRE



 6XEWUDFWLQJ E



IURPWKLVHTXDWLRQ\LHOGVWKH

HTXDWLRQ

&RQWLQXLQJLQWKLVZD\ZHJHWE



 E



 E



 E



 HWF+HQFHWKHELQDU\IRUPRILV

:HKDYHMXVWIRXQGDELQDU\IUDFWLRQIURPDGHFLPDOIUDFWLRQE\PXOWLSO\LQJE\UHSHDWHGO\7RILQGD

SHQWLPDOIUDFWLRQIURPDGHFLPDOIUDFWLRQZHEHJLQZLWKDVLPLODUHTXDWLRQDQGPXOWLSO\E\UHSHDWHGO\

%\GHILQLWLRQWKHEDVHILYHFRHIILFLHQWVPDNHWKLVHTXDWLRQWUXH

0XOWLSO\LQJWKLVHTXDWLRQE\\LHOGV

7KHLQWHJHUSDUWRIERWKVLGHVPXVWDJUHH+HQFHE



 6XEWUDFWLQJ E



\LHOGV

0XOWLSO\LQJWKLVHTXDWLRQE\\LHOGV

)URPWKLVZHJHWE



 DQG

&RQWLQXLQJLQWKLVZD\ZHJHWE



 E



 E



 E



 HWF6RWKHSHQWLPDOHTXLYDOHQWLV«

)XUWKHU5HDGLQJ

1XPEHU:RUGVDQG1XPEHU6\PEROV$&XOWXUDO+LVWRU\RI1XPEHUV.DUO0HQQLQJHU'RYHU%RRNV

&KDSWHU/2*,&&,5&8,76$1'&20387$7,21

(OHFWURQLFFRPSXWHUVDUHPDGHRIORJLFFLUFXLWV7KHDLPRIWKLVFKDSWHULVWRH[SODLQKRZWKHEDVLF

FRPSXWHUIXQFWLRQVRIDULWKPHWLFDQGVWRUDJHFDQEHGRQHXVLQJWKHVHFLUFXLWV,WFXOPLQDWHVLQDEULHI

GLVFXVVLRQRIWKH

$''

DQG

029

FRPPDQGV

7KHPRVWEDVLFORJLFFLUFXLWVDUHFDOOHGJDWHV*DWHVDUHFRQWUROOHUFLUFXLWV7KHVLPSOHVWORJLFJDWHLVWKH

127JDWH,QWKHQH[WVHFWLRQLWLVVKRZQKRZD127JDWHFDQFRQWURODIODVKOLJKW

7KH127*DWH

7KHVLPSOHIODVKOLJKWFLUFXLWVKRZQLQ

)LJXUH

LVFRQWUROOHGE\WKHVZLWFKDWWKHWRSZKLFKLVVKRZQLQ

WKHRSHQSRVLWLRQ7KHQHJDWLYHHQGRIWKHEDWWHU\LVFRQQHFWHGGLUHFWO\WRWKHEXOEEXWWKHSRVLWLYHHQGLV

RQO\FRQQHFWHGWRWKHEXOEE\ZD\RIWKHVZLWFK6RZKHQWKHVZLWFKLVRSHQFXUUHQWZLOOQRWIORZDQGWKH

EXOELVRII:KHQWKHVZLWFKLVFORVHGFXUUHQWFDQIORZDQGWKHEXOEFRPHVRQ7KHFRQWUROLVPHFKDQLFDO

)LJXUH$6LPSOH)ODVKOLJKW

/RJLF*DWH7HUPLQDOV

$ORJLFJDWHLVDFLUFXLWZKLFKZRUNVOLNHDVZLWFK

)LJXUH

VKRZVDJHQHULFORJLFJDWHKRRNHGXSWRD

EDWWHU\$VVKRZQLQWKHILJXUHDORJLFJDWHKDVIRXURUPRUHWHUPLQDOV

)LJXUH$*HQHULF/RJLF*DWH

 2XWSXW7HUPLQDO7KLVWHUPLQDOLVVZLWFKHGVRWKDWLWLVFRQQHFWHGHLWKHUWRWKHSRVLWLYHRUWKH

QHJDWLYHSRZHUWHUPLQDO7KHVZLWFKLQJLVGRQHE\VROLGVWDWHHOHFWURQLFVLPEHGGHGLQVLOLFRQDQG

LQYROYHVQRPRYLQJSDUWV

 3RVLWLYH3RZHU7HUPLQDO7KLVWHUPLQDOLVDOZD\VFRQQHFWHGWRWKHSRVLWLYHEDWWHU\RUSRZHUVXSSO\

WHUPLQDO

 1HJDWLYH3RZHU7HUPLQDO7KLVWHUPLQDOLVDOZD\VFRQQHFWHGWRWKHQHJDWLYHEDWWHU\RUSRZHU

VXSSO\WHUPLQDO

 ,QSXW7HUPLQDO$ORJLFJDWHKDVRQHRUPRUHLQSXWWHUPLQDOV7KHVHWHUPLQDOVFDUU\WKHLQSXW

VLJQDOVZKLFKGHWHUPLQHZKHWKHUWKHRXWSXWWHUPLQDOLVVZLWFKHGWRWKHSRVLWLYHRUWKHQHJDWLYHSRZHU

WHUPLQDO'LIIHUHQWW\SHVRIORJLFJDWHVPDNHWKLVGHWHUPLQDWLRQLQGLIIHUHQWZD\V

/RJLF9DOXH&RQYHQWLRQV

%HFDXVHWKHWZRSRZHUWHUPLQDOVRQWKHORJLFJDWHDUHDOZD\VFRQQHFWHGWRWKHFRUUHVSRQGLQJWHUPLQDOVRQ

WKHEDWWHU\RUSRZHUVXSSO\WKHRXWSXWWHUPLQDODOZD\VVXSSOLHVDFRQQHFWLRQWRHLWKHUWKHSRVLWLYHRUWKH

QHJDWLYHEDWWHU\RUSRZHUVXSSO\WHUPLQDO)RUFLUFXLWVLQWKLVERRN

z

$JDWHWHUPLQDOFRQQHFWHGGLUHFWO\RULQGLUHFWO\WRWKHSRVLWLYHEDWWHU\RUSRZHUVXSSO\WHUPLQDOLV

GHVFULEHGDVEHLQJDWORJLF

z

$JDWHWHUPLQDOFRQQHFWHGGLUHFWO\RULQGLUHFWO\WRWKHQHJDWLYHEDWWHU\RUSRZHUVXSSO\WHUPLQDOLV

GHVFULEHGDVEHLQJDWORJLF

%HFDXVHWKHLQSXWWHUPLQDOVDUHJHQHUDOO\FRQQHFWHGGLUHFWO\RULQGLUHFWO\WRWKHEDWWHU\RUSRZHUVXSSO\

WHUPLQDOVMXVWOLNHRXWSXWWHUPLQDOVWKH\FDQDOVREHGHVFULEHGDVEHLQJDWORJLFRUDWORJLF7KHIDFWWKDW

WKHLQSXWWHUPLQDOVDUHGHVLJQHGWREHDWORJLFRUORJLFKDVDVDIXUWKHUFRQVHTXHQFHWKDWWKHRXWSXWRIRQH

ORJLFJDWHFDQEHFRQQHFWHGWRWKHLQSXWRIDQRWKHUZLWKSUHGLFWDEOHUHVXOWV

%HKDYLRURIWKH127*DWH

7KH127JDWHLVDORJLFJDWHZKLFKKDVRQHLQSXWWHUPLQDO7RGHVFULEHWKHEHKDYLRURIWKH127JDWHDOO

WKDWLVQHHGHGLVWRGHVFULEHKRZLWVLQSXWGHWHUPLQHVLWVRXWSXW7KHUXOHVDUH

z

,IWKHLQSXWLVDWORJLFWKHRXWSXWLVDWORJLF

z

,IWKHLQSXWLVDWORJLFWKHRXWSXWLVDWORJLF

:HFDQQRZSXWDIODVKOLJKWWRJHWKHUE\KRRNLQJWKHRXWSXWRIWKH127JDWHWRDEXOEDQGWKHLQSXWWRD

PHFKDQLFDOVZLWFK

)LJXUH

LOOXVWUDWHVWKLVKRRNXS:KHQZLUHVLQDGLDJUDPDUHVKRZQFURVVLQJDWD

EODFNGRWLWPHDQVWKDWWKHZLUHVDUHFRQQHFWHG:KHQZLUHVFURVVDQGWKHUHLVQREODFNGRWLWPHDQVWKDW

WKH\DUHQRWLQFRQWDFWZLWKHDFKRWKHU7KHIODVKOLJKWLQWKLVILJXUHLVXOWLPDWHO\FRQWUROOHGE\DPHFKDQLFDO

VZLWFKMXVWOLNHWKHIODVKOLJKWLQ

)LJXUH

:KHQWKHVZLWFKLVLQWKHGRZQSRVLWLRQDVVKRZQLQWKHILJXUH

WKHIODVKOLJKWLVRQ7KHGRZQSRVLWLRQFRQQHFWVWKHLQSXWWHUPLQDORIWKH127JDWHWRWKHQHJDWLYHEDWWHU\

WHUPLQDOZKLFKSXWVLWDWORJLF7KHUHIRUHEHFDXVHRIWKHZD\D127JDWHZRUNVWKHRXWSXWLVDWORJLF

7KLVPHDQVWKDWWKHRXWSXWWHUPLQDOLVFRQQHFWHGLQWHUQDOO\E\WKH127JDWHWRWKHSRVLWLYHSRZHUWHUPLQDO

DQGWKHUHIRUHWRWKHSRVLWLYHHQGRIWKHEDWWHU\+HQFHWKHEXOEJHWVFXUUHQWDQGWKHIODVKOLJKWLVRQ

)LJXUH$127*DWH&RQWUROOHG)ODVKOLJKW

7UXWK7DEOHIRUWKH127*DWH

/RJLFYDOXHVPDNHLWHDV\WRVXPPDUL]HWKHEHKDYLRURID127JDWHZLWKDVPDOOWDEOH6XFKDWDEOHLVFDOOHG

DWUXWKWDEOH

7DEOH

VKRZVWKHWUXWKWDEOHIRUWKH127JDWH

*DWH/HYHO'LDJUDPV

$ORJLFFLUFXLWGLDJUDPZKLFKVKRZVWKHLQGLYLGXDOORJLFJDWHVEXWQRWWKHLULQWHUQDOPDNHXSLVFDOOHGDJDWH

OHYHOGLDJUDP,QDJDWHOHYHOGLDJUDPWKHSRZHUWHUPLQDOVRQWKHORJLFJDWHVDUHXVXDOO\QRWVKRZQ7KH

V\PEROIRUWKH127JDWHXVHGLQJDWHOHYHOGLDJUDPVVKRZVRQO\WZRWHUPLQDOVWKHLQSXWDQGWKHRXWSXW

7KHZLUHVKRZQRQWKHOHIWUHSUHVHQWVWKHLQSXWWKHZLUHRQWKHULJKWLVWKHRXWSXW

)LJXUH

VKRZVWKHGLDJUDPRIWKH127JDWHFRQWUROOHGIODVKOLJKWXVLQJWKHVFKHPDWLFV\PERO7KLV

GLDJUDPFDQEHFRQIXVLQJEHFDXVHWKHPDLQSRZHUFRQQHFWLRQVWRWKH127JDWHDUHQRWVKRZQ,QWKLV

ILJXUHWKHRQO\EDWWHU\FRQQHFWLRQLVDWWKHVLJQDOLQJLQSXWWRWKH127JDWH$OWKRXJKWKHSRZHU

FRQQHFWLRQVDUHQRWVKRZQWKH\PXVWEHWKHUHRUWKHFLUFXLWZLOOQRWZRUN

)LJXUH

UHSUHVHQWVH[DFWO\WKH

VDPHKRRNXSDV

)LJXUH



)LJXUH7KLV)ODVKOLJKWLV2Q

%RROHDQ2SHUDWRUV

7KH127JDWHGLVFXVVHGLQWKHODVWVHFWLRQLVDQH[DPSOHRIDORJLFJDWH/RJLFJDWHVDUHFLUFXLWVZKRVH

EHKDYLRULVPRGHOHGRQ%RROHDQRSHUDWRUV

7KHPRVWEDVLF%RROHDQRSHUDWRUVDUH$1'25;25DQG127,QWKH&ODQJXDJHZHKDYHWKHV\PEROV

IRU$1'__IRU25DQGIRU1277KHZRUNLQJVRIWKHVHRSHUDWRUVFDQEHLOOXVWUDWHGZLWKWZR

H[DPSOHVIURP&,QWKHVHH[DPSOHV

7DEOH7UXWK7DEOHIRU127*DWH

,QSXW

2XWSXW









WKH&ODQJXDJHVWDWHPHQWVDUHHYDOXDWHGXVLQJDVWHSE\VWHSVLPSOLILFDWLRQSURFHVV

7KH252SHUDWRU

7KHILUVWH[DPSOHLVDQ

LI

VWDWHPHQWLQYROYLQJWKH%RROHDQ25RSHUDWRU,QZKDWIROORZVZHVXSSRVHWKDW

[

KDVDOUHDG\EHHQJLYHQWKHYDOXH

LI[!__[\ 

z

)LUVWWKHWUXWKYDOXHVRIWKHRSHUDQGVPD\EHGHWHUPLQHG,QWKLVFDVHEHFDXVH

[!

LVWUXHLWKDV

WKHYDOXHEHFDXVH

[

LVIDOVHLWKDVWKHYDOXH7KHVHHYDOXDWLRQVUHVXOWLQWKHIROORZLQJ

VLPSOLILFDWLRQRIWKH&ODQJXDJHVWDWHPHQW

LI__\ 

z

7KH%RROHDQ25RSHUDWRUPD\EHDSSOLHGQH[W7KHRQO\WKLQJ25VHHVLVWKHWUXWKYDOXHVUHVXOWLQJ

IURPWKHRSHUDQGHYDOXDWLRQV25LVJLYHQDDQGDIURPZKLFKLWSURGXFHVD

LI\ 

z

7KH

LI

FDQJRWRZRUNQH[W$OOLWVHHVLQWKHSDUHQWKHVHVLVD+HQFHLWSURGXFHVWKHVLPSOH

DVVLJQPHQWVWDWHPHQW

\ 

7KHHQGUHVXOWRIWKHSURFHVVLVWKDW\LVVHWWRWKHYDOXH1RWLFHWKDWWKH25RSHUDWRUQHYHUVDZWKHYDOXH

RI

[

,WQHHGVRQO\VDQGVWRGRLWVMRE&RQVHTXHQWO\WKHZRUNLQJVRIWKH25RSHUDWRUFDQEHGHVFULEHG

LQDWUXWKWDEOHMXVWOLNHWKHWUXWKWDEOHIRUWKH127JDWH

7DEOH

VKRZVWKHWUXWKWDEOHIRUWKH25RSHUDWRU

,QWUXWKWDEOHVIRU%RROHDQRSHUDWRUVWKHOHWWHUVSDQGTDUHRIWHQXVHGDVYDULDEOHVIRUWKHWUXWKYDOXHVDQG

9DULDEOHVZKLFKKDYHRQO\WKHVHWZRSRVVLEOHYDOXHVDUHVRPHWLPHVFDOOHG%RROHDQYDULDEOHV1RWLFHWKDW

WKHGHFLVLRQPDGHLQWKH&H[DPSOHFRXOGKDYHEHHQLQIHUUHGIURPWKHVHFRQGOLQHRI

7DEOH



7KH$1'2SHUDWRU

7KH$1'RSHUDWRUFDQDOVREHGHVFULEHGZLWKDWUXWKWDEOH6HH

7DEOH

7KHQH[WH[DPSOHVKRZVWKHXVH

RIWKLVWDEOHLQHYDOXDWLQJD&ODQJXDJHVWDWHPHQWFRQWDLQLQJDQ$1'RSHUDWRU

z

$JDLQVXSSRVHWKDW

[ 

LI[! [] 

7DEOH7UXWK7DEOHIRU25

S

T

S25T

























7DEOH7UXWK7DEOHIRU$1'

S

T

S$1'T

























z

$JDLQWKHRSHUDQGVKDYHWKHYDOXHVDQG

LIO ] 

z

7KHRSHUDWLRQRIWKH$1'RSHUDWRUFDQEHUHIHUUHGWRWKHVHFRQGOLQHRI

7DEOH

IURPZKLFKZHVHH

WKDWDUHVXOWV

LI] 

z

7KHLQWKHSDUHQWKHVHVUHVXOWVLQDQXOOVWDWHPHQW1RWKLQJKDSSHQV



)URPWKHVHH[DPSOHVLWLVFOHDUWKDWWKHMRERIWKH%RROHDQRSHUDWRUVLVWRRSHUDWHRQWUXWKYDOXHVDQG

SURGXFHDWUXWKYDOXH

%RROHDQ([SUHVVLRQV

-XVWDVRSHUDWRUVLQ&PD\EHQHVWHGDVLQWKHVWDWHPHQW

LI[! [__[ Z 

VR%RROHDQRSHUDWRUVE\WKHPVHOYHVPD\EHQHVWHG

7KHUHVXOWLQJH[SUHVVLRQVDUHFDOOHG%RROHDQH[SUHVVLRQV-XVWDV%RROHDQRSHUDWRUVKDYHWUXWKWDEOHVVRGR

%RROHDQH[SUHVVLRQV7KHWUXWKWDEOHIRUWKHH[SUHVVLRQMXVWVKRZQLVJLYHQLQ

7DEOH



/RJLF*DWHV

7DEOH

VKRZVWKHWUXWKWDEOHIRUWKH%RROHDQ127RSHUDWRU,WLVYHU\VLPLODUWRWKHWUXWKWDEOHIRUWKH

127JDWHVKRZQLQ

7DEOH

,IZHWKLQNRISDVWKHLQSXWDQG127SDVWKHRXWSXWWKHUHLVLQIDFWQR

GLIIHUHQFH2QHVKRXOGHYHQWKLQNRIWKH127JDWHDVDVLOLFRQLPSOHPHQWDWLRQRIWKH127RSHUDWRU7KH

%RROHDQRSHUDWRUV$1'25DQG;25DUHDOVRLPSOHPHQWHGLQVLOLFRQ

7DEOH7UXWK7DEOHIRUD%RROHDQ([SUHVVLRQ

S

T

U

S$1'T25U

































































7DEOH7UXWK7DEOHIRU127

S

127S









7KH25*DWH

7KH25JDWHLVDFLUFXLWZLWKWZRLQSXWWHUPLQDOV,WLVUHSUHVHQWHGLQJDWHOHYHOGLDJUDPVZLWKWKHV\PERO

7KHLQSXWVDUHVKRZQRQWKHOHIW7KHRXWSXWLVRQWKHULJKW)URP

7DEOH

ZHPD\LQIHUWKDW

z

,IERWKLQSXWWHUPLQDOVDUHDWORJLFWKHQWKHRXWSXWWHUPLQDOZLOOEHDWORJLF

z

,IHLWKHULQSXWWHUPLQDOLVDWORJLFWKHQWKHRXWSXWWHUPLQDOZLOOEHDWORJLF

,QWKHIROORZLQJFLUFXLWIRUH[DPSOHXQOHVVWKHORJLFYDOXHVDSSOLHGWRDOORIWKH)LOWHULQSXWVDUHHTXDOWR

WKHRXWSXWZLOOEHDWORJLF,IDORJLFLVDSSOLHGWRHDFKRIWKH)LOWHULQSXWVWKHQWKHRXWSXWORJLFYDOXH

ZLOOEHWKHVDPHDVWKHLQSXWORJLFYDOXH,QWKLVFDVHRQHFDQWKLQNRIWKHLQSXWVLJQDODVKDYLQJSDVVHG

WKURXJKWKHJDWHV1RWHWKDWWKHJDWHDQDORJ\PDNHVVHQVHLQWHUPVRIWKHSURSRJDWLRQRIDVLJQDOQRWWKH

SURSDJDWLRQRIDYROWDJH$ORJLFDSSOLHGWRDQ\RIWKH)LOWHULQSXWVJXDUDQWHHVWKDWWKHRXWSXWZLOOEHDW

ORJLFEXWWKLVVKRXOGEHWKRXJKWRIDVWKHFORVLQJRIWKHJDWH$FKDQJHLQWKHLQSXWZLOOQRWPDNHLW

WKURXJKWRWKHRXWSXW7KHFLUFXLWGRHVQRWDOORZVLJQDOVWRSDVV+HQFHLWPDNHVVHQVHWRWKLQNRIWKHVH25

JDWHVDVFORVHGZKHQDUHJXODWRU\LQSXWLVDWORJLF

7KH$1'*DWH

7KH$1'JDWHLVDOVRDWZRLQSXWJDWH,WVV\PEROLV

)URP

7DEOH

ZHPD\LQIHUWKDW

z

,IERWKLQSXWWHUPLQDOVDUHDWORJLFWKHQWKHRXWSXWWHUPLQDOZLOOEHDWORJLF

7DEOH7UXWK7DEOHIRU;25

S

T

S;25T

























z

,IHLWKHULQSXWWHUPLQDOLVDWORJLFWKHQWKHRXWSXWWHUPLQDOZLOOEHDWORJLF

,QWKHIROORZLQJFLUFXLWWKHORJLFYDOXHVDSSOLHGWRDOOWKH)LOWHULQSXWVPXVWHTXDORWKHUZLVHWKHRXWSXW

ZLOOEHDWORJLF,IDORJLFLVDSSOLHGWRHDFKRIWKH)LOWHULQSXWVWKHQWKHLQSXWORJLFYDOXHSDVVHVWKURXJK

WKHJDWHVDQGEHFRPHVWKHRXWSXWYDOXH

%RROHDQ&LUFXLWV

$1'25DQG127ORJLFJDWHVFDQEHXVHGWREXLOGXSDJUHDWYDULHW\RIORJLFFLUFXLWV)RUDQ\%RROHDQ

H[SUHVVLRQWKHUHLVDFRUUHVSRQGLQJFLUFXLW)RUH[DPSOHFRUUHVSRQGLQJWRWKH%RROHDQH[SUHVVLRQ

RQHFDQFRQVWUXFWWKHFLUFXLW

7KHWUXWKWDEOHIRUWKLVFLUFXLWLVWKHVDPHDVWKHWUXWKWDEOHRIWKH%RROHDQH[SUHVVLRQLWFRPHVIURP,WLV

JLYHQLQ

7DEOH



7KHWUXWKWDEOHIRUWKH%RROHDQRSHUDWRU;25LVVKRZQLQ

7DEOH

2QHFDQILQGD%RROHDQH[SUHVVLRQIRU

;25E\XVLQJWKHOLQHVRILWVWUXWKWDEOHWKDWKDYHDORJLFRXWSXW8VLQJWKHWDEOHZHILQGWZRVXFKOLQHV

RQHZKHUHS DQGT DQGRQHZKHUHS DQGT 7KHVHDUHWKHOLQHVIRUZKLFKWKHH[SUHVVLRQVS

$1'127TDQG127S$1'TDUHWUXH+HQFHWKHH[SUHVVLRQ

KDVWKHVDPHWUXWKWDEOHDV;25DQGPD\EHXVHGWRFRQVWUXFWDFLUFXLWIRU;25

7KH%RROHDQH[SUHVVLRQS25T$1'127S$1'TDOVRKDVWKHVDPHWUXWKWDEOH7KHUHIRUHWKH

ORJLFFLUFXLWZKLFKFRUUHVSRQGVWRWKLVH[SUHVVLRQDOVRZRUNVDVDQ;25FLUFXLW7KDWFLUFXLWORRNVOLNHWKLV

7KHVWDQGDUGV\PEROIRU;25LV

;25PD\EHLPSOHPHQWHGXVLQJDQ\FLUFXLWZKLFKKDVWKHFRUUHFWWUXWKWDEOHLQFOXGLQJWKHWZRMXVWVKRZQ

3URSDJDWLRQ'HOD\

6RPHHVVHQWLDOIHDWXUHVRIORJLFFLUFXLWEHKDYLRUDUHOHIWRXWRIDQ\GHVFULSWLRQEDVHGRQO\RQ%RROHDQ

H[SUHVVLRQVDQGWUXWKWDEOHV2QHVXFKIHDWXUHLVWKHSURSDJDWLRQGHOD\WKHWLPHUHTXLUHGIRUDFKDQJHLQDQ

LQSXWVLJQDOWRFDXVHDFKDQJHLQWKHRXWSXW7KHSURSDJDWLRQGHOD\RIDJDWHXVHGLQD0+]SURFHVVRU

IRUH[DPSOHPXVWEHOHVVWKDQQDQRVHFRQGV7KLVLVEHFDXVH0+]PHDQVPLOOLRQF\FOHVSHU
VHFRQGFSV6RWKHOHQJWKRIHDFKSURFHVVLQJF\FOHLV

VHFRQGZKLFKLVWKHVDPHDV

VHFRQGRUQDQRVHFRQGV

&RQVLGHULQJWKDWWKHH[HFXWLRQRIRQHSURFHVVLQJF\FOHPLJKWUHTXLUHDVLJQDOWRSDVVWKURXJKVD\ILYHVXFK

JDWHVLQVXFFHVVLRQWKHOLPLWFRXOGGURSWRQDQRVHFRQGVRUOHVV5HGXFLQJWKLVWLPHGHOD\LVRQHRIWKH

PDLQJRDOVLQFXUUHQWIDEULFDWLRQWHFKQRORJ\7KHOHVVWKHSURSDJDWLRQGHOD\WKHIDVWHUWKHFORFNVSHHGDW

ZKLFKDFLUFXLWFDQEHUXQ

$OVRLPSRUWDQWLVWKHDPRXQWRISRZHUGLVVLSDWHG:KHQPDQ\FLUFXLWVDUHSDFNHGWRJHWKHURQDFKLSWKH

WHPSHUDWXUHPD\LQFUHDVHWRXQDFFHSWDEOHOHYHOVXQOHVVWKHSRZHUGLVVLSDWHGE\HDFKFLUFXLWLVUHGXFHGWRD

YHU\ORZOHYHO5HGXFLQJSRZHUGLVVLSDWLRQLVDQRWKHUSULPDU\JRDORISURFHVVRUGHVLJQ

7KHDUFKLWHFWXUHSRLQWRIYLHZOHDYHVWKHVHSUREOHPVRXWRIWKHSLFWXUH)URPWKDWVWDQGSRLQWDOOZHQHHGWR

NQRZDERXWD%RROHDQFLUFXLWLVFRQWDLQHGLQLWVWUXWKWDEOH7KHDUFKLWHFWXUHSRLQWRIYLHZLVPRUHRIWHQ

VXLWDEOHLQFRPSXWHUVFLHQFHWKDQLQHOHFWULFDOHQJLQHHULQJ

$GGLWLRQ&LUFXLWV

)UHTXHQF\

&\FOH/HQJWK

+]

FSV

V

VHF

N+]

FSV

PV

0+]

FSV

—V

*+]

FSV

QV

7KLVVHFWLRQVKRZVKRZDGGLWLRQLVGRQHXVLQJORJLFFLUFXLWV

&RQVLGHUWKHDGGLWLRQRIDQGDJDLQDQGREVHUYHWKDWLQHDFKFROXPQZHKDYHWZRGLJLWVWRDGGDORQJ

ZLWKDFDUU\GLJLWIURPWKHSUHFHGLQJFROXPQ

$QDGGLWLRQFLUFXLWZKLFKFDQGRWKHZRUNLQYROYHGLQRQHFROXPQRIVXFKDQDGGLWLRQLVFDOOHGDIXOODGGHU

,WSURGXFHVWKHVXPRIWKHWZRGLJLWVLQWKDWFROXPQDQGDFDUU\GLJLWIURPWKHSUHYLRXVFROXPQ,WDOVR

SURGXFHVDQRXWSXWFDUU\GLJLW7KHDGGLWLRQRIDQGDVVKRZQUHTXLUHVWKHXVHRIIRXUIXOODGGHUFLUFXLWV

%HFDXVHWKHELQDU\V\VWHPLVEHLQJXVHGWKH%RROHDQWUXWKYDOXHVDQGPD\EHXVHGDVELQDU\GLJLWV

7DEOH

VKRZVWKHWUXWKWDEOHIRUDIXOODGGHUFLUFXLW,WLVQRWKDUGWRFRQVWUXFWDIXOODGGHU7KH2XWSXW

6XPFLUFXLWFDQEHEXLOWIURPWZR;25FLUFXLWV7KH2XWSXW&DUU\FLUFXLWFDQEHEXLOWIURPWKUHH$1'VDQG

WZR25V6HH

)LJXUH

$IXOODGGHUKDVWKUHHLQSXWVDQGWZRRXWSXWVZKLFKWRJHWKHUIXQFWLRQDVRQH

FROXPQRIDQDGGLQJPDFKLQH

)LJXUH)XOO$GGHU&LUFXLW

7DEOH7UXWK7DEOHIRUD)XOO$GGHU

,QSXW'LJLW

,QSXW'LJLW

,QSXW&DUU\

2XWSXW6XP

2XWSXW&DUU\

















































































$FLUFXLWZKLFKDGGVIRXUGLJLWELQDU\QXPEHUVUHTXLUHVIRXUIXOODGGHUVJDQJHGWRJHWKHU

7KLVLVZKDWWKHDGGLQJFLUFXLWVLQDIRXUELWSURFHVVRUORRNOLNH6KRZQKHUHLVWKHVDPHFDOFXODWLRQRI

WKLUWHHQSOXVVL[LOOXVWUDWHGDWWKHEHJLQQLQJRIWKLVVHFWLRQ,QELQDU\WKDWLVSOXV7KHUHVXOWLQJ

WRWDOLV7KHUHLVDOVRDQRXWSXWFDUU\YDOXHRI7KHLQSXWFDUU\LVQRWXVHGKHUH6XUSULVLQJO\HQRXJK

WKHUHLVDQHHGIRULWKRZHYHU:HZLOOVHHZKDWWKDWLVLQ

VHFWLRQ



,WLVRQHRIWKHFKDUDFWHULVWLFVRIDIRXUELWSURFHVVRUWKDWLWDGGVELQDU\QXPEHUVIRXUELWVDWDWLPH

$FRPSXWHUZLWKDIRXUELWSURFHVVRUZRXOGQRWEHOLPLWHGWRVPDOOQXPEHUDULWKPHWLFEXWLWVVRIWZDUH

ZRXOGQHHGWREUHDNODUJHQXPEHUVGRZQLQWRQXPEHUVQRELJJHUWKDQ

6HTXHQWLDO&LUFXLWV

,QDOOWKHFLUFXLWVVKRZQVRIDUWKHRXWSXWLVGHWHUPLQHGE\WKHLQSXWV%\XVLQJWKHWUXWKWDEOHVRIWKH

FRPSRQHQWJDWHVRQHFDQFRQVWUXFWDWUXWKWDEOHIRUWKHZKROHFLUFXLW,WPLJKWVHHPWKDWWKLVVKRXOGEHWKH

FDVHZLWKDOOORJLFFLUFXLWV+RZHYHULIDQRXWSXWLVIHGEDFNDURXQGWRDQLQSXWWKHQDYLFLRXVFLUFOHLV

LQWURGXFHGLQWRWKHSURFHVVRIGHWHUPLQLQJWKHWUXWKWDEOH&LUFXLWVZLWKIHHGEDFNORRSVDUHFDOOHGVHTXHQWLDO

FLUFXLWV

&LUFXLWVZLWKRXWIHHGEDFNORRSVDUHQRWFDSDEOHRIVWRULQJORJLFYDOXHV7KHRXWSXWRID%RROHDQFLUFXLWLVD

IXQFWLRQRILWVLQSXWVLWVSUHVHQWLQSXWV7KDWPHDQVIRUH[DPSOHLI\RXWULHGWRXVHD%RROHDQFLUFXLWDVD

PHPRU\WKHQQRPDWWHUZKDW\RXGHFLGHGXSRQDVWKHPHPRU\IHWFKFRPPDQGWKLVLQSXWZRXOGDOZD\V

SURGXFHWKHVDPHRXWSXWQDPHO\WKHRXWSXWVSHFLILHGE\WKHWUXWKWDEOHVRLWZRXOGQRWEHDWUXHPHPRU\

IHWFK7KHRXWSXWIURPDWUXHPHPRU\IHWFKZRXOGGHSHQGXSRQZKDWZDVVWRUHGDWVRPHWLPHLQWKHSDVW

6HTXHQWLDOFLUFXLWVDUHLPSRUWDQWEHFDXVHWKH\FDQVWRUHORJLFYDOXHV

$)OLSIORS

)LJXUH

VKRZVDQH[DPSOHRIDFLUFXLWFDOOHGDIOLSIORS7KH6LQWKHILJXUHVWDQGVIRUVHWDQGWKH5VWDQGV

IRUUHVHW7KHRXWSXWRIWKLVFLUFXLWPD\EHVHWLI6 DQG5 ,QWKLVFDVHWKH$1'JDWHIHGE\WKH5

LQSXWLVIRUFHGWRRXWSXWD+HQFHERWKLQSXWVRQWKHRWKHU$1'JDWHDUH+HQFHLWVRXWSXWLVDQGWKH

ILQDORXWSXWLV

)LJXUH)OLSIORS

,I6 DQG5 WKHVLWXDWLRQLVMXVWUHYHUVHGDQGWKHILQDORXWSXWLV

+RZHYHULI6 DQG5 WKHRXWSXWLVQRWGHWHUPLQHGE\WKHWUXWKWDEOHV7KHIHHGEDFNORRSVPDNHWKDW

LPSRVVLEOH,WWXUQVRXWKRZHYHUWKDWLIWKH6 5 VWDWHZDVHQWHUHGIURPHLWKHUWKHVHWRUWKHUHVHWVWDWH

WKHQWKHILQDORXWSXWLVOHIWDORQH,WGRHVQRWFKDQJH

$/DWFK

)LJXUH

VKRZVDQH[DPSOHRIDFLUFXLWFDOOHGDODWFK7KLVFLUFXLWVWRUHVRQHELW,WLVFDOOHGDODWFKEHFDXVH

LWODWFKHVRQWRDYDOXH

)LJXUH/DWFK

7KH)UHH]H&RS\ODEHOLQWKLVILJXUHXVHVWKH,QWHOFRQYHQWLRQWKDWZKHQDVLJQDOLVODEHOHGZLWKD

PHDQLQJIXOZRUGWKHQWKHPHDQLQJWUXWKIXOO\DSSOLHVZKHQWKHOLQHLVDWORJLFXQOHVVWKHODEHOKDVD

DSSHQGHGDQGWKHQWKHRSSRVLWHLVWKHFDVH6RWKH)UHH]H&RS\ODEHOWHOOVXVWKDWORJLFPHDQV)UHH]HDQG

ORJLFPHDQV&RS\

z

:KHQWKH)UHH]H&RS\OLQHLV]HURWKH25JDWHVDUHRSHQHGDQGWKHFLUFXLWLVWXUQHGLQWRDIOLSIORS

ZKHUHWKHLQSXWLVHLWKHUVHWRUUHVHW7KH127JDWHPDNHVWKH6DQG5LQSXWVRSSRVLWHWRHDFKRWKHU

7KHLQSXWYDOXHLVFRSLHGWRWKHRXWSXW

z

:KHQWKH)UHH]H&RS\OLQHEHFRPHVERWK25JDWHVDUHIRUFHGWRDQGWKLVIUHH]HVWKHRXWSXW

:KHQWKHRXWSXWLVIUR]HQVXEVHTXHQWFKDQJHVLQWKHLQSXWKDYHQRHIIHFWRQWKHFLUFXLW7KHRXWSXW

YDOXHUHPDLQVMXVWZKDWLWZDVWKHODVWWLPHWKH)UHH]H&RS\OLQHWXUQHGIURPWRLHWKHODVWWLPH

LWIUR]H

7KDWRXWSXWYDOXHLVLQVWRUDJH

5HJLVWHUV

)RXUODWFKHVXVHGWRJHWKHULQSDUDOOHOFDQVWRUHIRXUELWV7KLVLVDQH[DPSOHRIDUHJLVWHU$IRXUELWUHJLVWHU

LVDFROOHFWLRQRIFLUFXLWVWKDWFDQVWRUHIRXUELWV'LIIHUHQWUHJLVWHUVLQDSURFHVVRUGRQRWKDYHWRVWRUHWKH

VDPHQXPEHURIELWVEXWLWLVHDVLHUWRPDNHWKLQJVZRUNZKHQWKH\GR7KHQXPEHURIELWVLQDW\SLFDO

UHJLVWHULVRQHRIWKHDWWULEXWHVRIDSURFHVVRUZKLFKGHWHUPLQHVZKHWKHULWLVFDOOHGDIRXUELWSURFHVVRUDQ

HLJKWELWSURFHVVRURUZKDWHYHU

7KHFRQWHQWVRIDIRXUELWUHJLVWHUDUHYHU\QDWXUDOO\VSHFLILHGXVLQJDIRXUGLJLWELQDU\QXPEHU7KHIRXU

GLJLWELQDU\QXPEHUVDUHWKHLQWHJHUVIURPWKURXJK$QHLJKWELWUHJLVWHUKROGVDQLQWHJHUIURP

WKURXJK

:HVHHWKDWWKHPRVWQDWXUDOZD\RIVSHFLI\LQJWKHFRQWHQWVRIDUHJLVWHUOHDYHVQRURRPIRUQHJDWLYH

QXPEHUV7KHUHSUHVHQWDWLRQRIQHJDWLYHQXPEHUVZLOOEHGLVFXVVHGLQWKHQH[WVHFWLRQ

%LW6LJQLILFDQFH

%HFDXVHELQDU\QXPEHUVDUHXVHGWRGHVFULEHWKHFRQWHQWVRIUHJLVWHUVDQGPHPRU\ORFDWLRQVWKHQXPHULFDO

FRQFHSWRIDVLJQLILFDQWGLJLWLVXVHIXOLQVLQJOLQJRXWLQGLYLGXDOELWVRIDVSHFLILFVWRUDJHORFDWLRQ)RU

H[DPSOHLIDIRXUELWUHJLVWHUKROGVWKHELQDU\QXPEHUWKHQWKHIRXUGLJLWVLQRUGHURIVLJQLILFDQFHDUH

DQG6RWKHPRVWVLJQLILFDQWGLJLWLVDQGWKHOHDVWVLJQLILFDQWGLJLWLV7KHWKUHHPRVWVLJQLILFDQW

GLJLWVDUH7KHWKUHHOHDVWVLJQLILFDQWGLJLWVDUH6RPHWLPHVLQWKLVWH[WWKHPRVWVLJQLILFDQWELWVZLOO

EHUHIHUUHGWRDVWKHWRSRUXSSHUELWVDQGWKHOHDVWVLJQLILFDQWDVWKHERWWRPRUORZHUELWV

1HJDWLYH1XPEHU5HSUHVHQWDWLRQ

7KHFXVWRPDU\ZD\WRUHSUHVHQWDQHJDWLYHQXPEHULVWRSUHSHQGDPLQXVVLJQ3XWWLQJDLQIURQWRID

PDNHVD7KLVPHWKRGRIUHSUHVHQWLQJQHJDWLYHVLVFDOOHGVLJQHGPDJQLWXGHUHSUHVHQWDWLRQ,WFDQEH

LPSOHPHQWHGRQWKHFRPSXWHUE\DOORFDWLQJRQHELWRIVWRUDJHIRUDVLJQELW7RFKDQJHWKHVLJQRIDQXPEHU

WKDWLVVWRUHGXVLQJVLJQHGPDJQLWXGHUHSUHVHQWDWLRQRQHFDQVLPSO\IOLSWKHVLJQELW6LJQHGPDJQLWXGH

UHSUHVHQWDWLRQLVQRWJHQHUDOO\XVHGIRULQWHJHUVRQWKHFRPSXWHU7KHUHDVRQLVWKDWLQRUGHUWRGRDGGLWLRQ

ZLWKVLJQHGPDJQLWXGHUHSUHVHQWDWLRQ\RXQHHGWRGRLWWKHZD\LWLVWDXJKWWR\RXQJVWHUV

6LJQHG0DJQLWXGH$GGLWLRQ

7RDGG[DQG\

&DVH,,I[DQG\DUHERWKSRVLWLYHMXVWDGGDQGPDNH\RXUDQVZHUSRVLWLYH

&DVH,,,I[DQG\DUHERWKQHJDWLYHUHPRYHWKHQHJDWLYHVLJQVDGGWKHQXPEHUVDQGWDFND

PLQXVVLJQRQWRWKHUHVXOW

&DVH,,,,I[DQG\KDYHGLIIHUHQWVLJQVVXEWUDFWWKHVPDOOHUPDJQLWXGHIURPWKHODUJHU

PDJQLWXGHDQGLIWKHODUJHUPDJQLWXGHKDGDPLQXVVLJQWKHQWDFNWKLVRQWRWKHUHVXOW

,PSOHPHQWLQJVLJQHGPDJQLWXGHDGGLWLRQZLWKORJLFFLUFXLWVRQDFKLSZRXOGEHDWHUULEOHZDVWHRI

WUDQVLVWRUV

(DV\$GGLWLRQ

7KHPHWKRGZKLFKLVDFWXDOO\XVHGZLWKORJLFFLUFXLWVWRDGG[DQG\ZRUNVOLNHWKLV

3D\QRDWWHQWLRQWRZKHWKHU[DQG\DUHSRVLWLYHRUQHJDWLYHMXVWDGGWKHP

6XFKDPHWKRGZRXOGVHHPWREHQRPHWKRGDWDOO%XWLWZRUNV,WZRUNVEHFDXVHDVSHFLDOV\VWHPIRU

UHSUHVHQWLQJQHJDWLYHVLVXVHGDQGEHFDXVHDUHJLVWHUKDVDILQLWHVL]HOLNHDQRGRPHWHU

2GRPHWHU$ULWKPHWLF

$QRGRPHWHULVDQDGGLQJPDFKLQH,WDGGVXSWKHPLOHVWKDW\RXGULYH0LOHDJHLVDOZD\VFRQVLGHUHGWRKDYH

DSRVLWLYHYDOXH:RXOGDQHJDWLYHYDOXHLPSO\GULYLQJEDFNZDUGVRUZKDW"+RZHYHUFRQVLGHUWKH

IROORZLQJHTXDWLRQZKLFKZHZRXOGRUGLQDULO\WKLQNRIDVPDNLQJVHQVHRQO\IRUQHJDWLYHQXPEHUV

7KHREYLRXVVROXWLRQLV[ +RZHYHUWKHUHLVDQRGRPHWHULQWHUSUHWDWLRQRIWKLVHTXDWLRQDVZHOO

6XSSRVH\RXGULYHPLOHVLQ\RXUFDUDQGWKHRGRPHWHUUHDGVZKHQ\RXILQLVKWKHQZKDWGLGLWUHDG

ZKHQ\RXEHJDQ",WPXVWKDYHUHDG6LPLODUO\LI\RXKDYHDFDUZKRVHRGRPHWHUUHDGVPLOHVDQG

\RXGULYHLWPLOHVWKHQWKHRGRPHWHUVKRXOGUHDGPLOHVZKHQ\RXILQLVK7KHSRLQWKHUHLVWKDW

DFWVMXVWOLNHZKHQDGGHGRQWKHRGRPHWHU

7DEOH

VKRZVZKDWRGRPHWHUQHJDWLYHVORRNOLNH

1RWLFHWKDWWRJHWWKHQXPEHUWKDWZRUNVDVWKHQHJDWLYHRIDQXPEHU[\RXVXEWUDFW[IURP

$ULWKPHWLFRQWKHRGRPHWHUZRUNVWKLVZD\EHFDXVHWKHRGRPHWHUWXUQVRYHUDWPLOHV&RPSXWHU

UHJLVWHUVWXUQRYHUDOVR²EXWQRWDW

5HJLVWHU$ULWKPHWLF

$IRXUELWUHJLVWHUWXUQVRYHUDWELQDU\ 



 7KHWDEOHRIQHJDWLYHVIRUDIRXUELWUHJLVWHUFDQ

HDVLO\EHOLVWHGFRPSOHWHO\6HH

7DEOH

7KHRQO\GLIIHUHQFHEHWZHHQWKLVWDEOHDQGWKHRGRPHWHUWDEOHLV

WKDWLVDORWVPDOOHUWKDQ$VZLWKWKHRGRPHWHU\RXFDQXVHVXEWUDFWLRQLQVWHDGRIWKHWDEOHWR

ILQGWKHQXPEHUZKLFKZRUNVDVWKHQHJDWLYHRIVRPHQXPEHU[,QWKHFDVHRIDIRXUELWUHJLVWHU\RX

VXEWUDFW[IURPLQVWHDGRIIURP2WKHUZLVHLWLVWKHVDPH

%XWLQRQHUHVSHFW

7DEOH

LVDOLWWOHDODUPLQJ)RUH[DPSOHLWJLYHVXVWKHIDFWWKDWZRUNVWKHVDPHDV

7KLVPHDQVZHQRZKDYHDVHULRXVDPELJXLW\,IDIRXUELWUHJLVWHUFRQWDLQVZHFDQQRWWHOOZKHWKHU

WKLVDFWXDOO\PHDQVRU6RPHFRQYHQWLRQLVQHHGHG7KHFRQYHQWLRQWKDWLVXVHGLVWRWDNHWKHILUVWELW

DVDNLQGRIVLJQELW:KHQWKHILUVWELWLVWKHQXPEHULVSRVLWLYHRU]HUR:KHQWKHILUVWELWLVWKH

QXPEHULVQHJDWLYH7KHUHVXOWLQJV\VWHPLVFDOOHGWKHWZR VFRPSOHPHQWV\VWHP:KHQWKHWZR V

FRPSOHPHQWV\VWHPLVXVHGWKHDPELJXLW\LV

7DEOH2GRPHWHU1HJDWLYHV

 
 
 
 
 
 
 
 
 

 
 
 

 

HWF 

7DEOH)RXU%LW5HJLVWHU1HJDWLYHV$PELJXRXV

'HFLPDO

%LQDU\

















































1RWLFHWKDWDOWKRXJKWKHILUVWELWLQDWZR VFRPSOHPHQWV\VWHPLVDVLJQELWLWLVQRWMXVWDVLJQELW)RU

H[DPSOHLIZHFKDQJHWKHVLJQELWRQZHJHW7KLVFKDQJHVWRQRW

6LJQHGYV8QVLJQHG1XPEHUV

,IDOODULWKPHWLFGRQHRQFRPSXWHUVZHUHGRQHXVLQJWZR VFRPSOHPHQWUHSUHVHQWDWLRQWKHUHZRXOGQHYHUEH

DQ\SUREOHPLQWHUSUHWLQJWKHFRQWHQWVRIDQXPHULFDOUHJLVWHU%XWXQIRUWXQDWHO\WKLVLVQRWWKHFDVH

6RPHWLPHVDULWKPHWLFLVGRQHDQGLWLVDVVXPHGWKDWWKHQXPEHUVDUHUHSUHVHQWHGXVLQJWKHSODLQELQDU\

V\VWHP6RZKHQDIRXUELWUHJLVWHUKDVDLQLWGRHVWKLVPHDQRU",IZHDUHXVLQJWZR V

FRPSOHPHQWWKHQZHNQRZLWLV%XWZHFRXOGEHXVLQJMXVWSODLQELQDU\7KHQZHKDYH&RPSXWLQJ

SUDFWLFHLVQRWFRQVLVWHQWDERXWWKLV%RWKV\VWHPVDUHXVHG,WFRXOGEHHLWKHURQH,WLVXSWRWKHVRIWZDUHWR

PDNHWKHGLVWLQFWLRQ7KHWHUPLQRORJ\VLJQHGYVXQVLJQHGLVRIWHQXVHG6LJQHGLQWHJHUVDUHWZR V

FRPSOHPHQWLQWHJHUV8QVLJQHGLQWHJHUVDUHSODLQELQDU\LQWHJHUV

$OWKRXJKZKHQZHDUHDGGLQJQXPEHUVLWGRHVQ WPDWWHULIWKHQXPEHUVDUHVLJQHGRUXQVLJQHG²WKH

DGGLQJKDUGZDUHZRUNVHLWKHUZD\²PDQ\RWKHURSHUDWLRQVUHTXLUHGLIIHUHQWLPSOHPHQWDWLRQVGHSHQGLQJ

RQZKHWKHUWKHRSHUDQGLVLQWHQGHGDVDVLJQHGRUDQXQVLJQHGQXPEHU&RQVLGHULQHTXDOLW\WHVWLQJ6XSSRVH

IRXUELWKDUGZDUHLVDVNHGWRGHWHUPLQHZKHWKHULVWUXHRUQRW:KLOHUHSUHVHQWVLQERWK

WKHVLJQHGDQGWKHXQVLJQHGV\VWHPVLVDVDVLJQHGQXPEHUDQGDVDQXQVLJQHGQXPEHU7KH

VLJQHGLQWHUSUHWDWLRQ\LHOGVDWUXHZKHUHDVWKHXQVLJQHGLQWHUSUHWDWLRQ\LHOGVDIDOVH7KH

KDUGZDUHPXVWPDNHDGLIIHUHQWUHVSRQVHLQWKHWZRFDVHV7KLVPHDQVWKDWDVLQJOHOHVVWKDQFRPPDQG

FDQQRWZRUN7ZRDUHQHHGHGRQHIRUVLJQHGQXPEHUVDQGRQHIRUXQVLJQHGQXPEHUV7KLVLVVXHFRPHVXS

RYHUDQGRYHUDJDLQLQDVVHPEO\ODQJXDJH

,QWKH&ODQJXDJHLQWHJHUVPD\EHGHFODUHGDV

XQVLJQHGLQW

RUDV

VLJQHGLQW

7KHXQVSHFLILHG

LQW

GHFODUDWLRQPHDQVWKHVDPHDV

VLJQHGLQW

6XEWUDFWLRQ8VLQJ1HJDWLRQ











































7DEOH)RXU%LW7ZR V&RPSOHPHQW5HSUHVHQWDWLRQ

'HFLPDO

%LQDU\





























































7KLVVHFWLRQH[SODLQVKRZVXEWUDFWLRQPD\EHGRQHXVLQJWKHFLUFXLWVGHVFULEHGVRIDU

7ZR V&RPSOHPHQWDWLRQ

6LQFHZHKDYHDQDGGHUWKDWZRUNVZLWKQHJDWLYHVZHVKRXOGEHDEOHWRXVHLWWRGRVXEWUDFWLRQVVXFKDV

VLQFH

%XWWKHUHLVDSUREOHP&RQYHUWLQJWRLVQRWDVHDV\DVMXVWVWLFNLQJRQDPLQXVVLJQRUIOLSSLQJDELW,ILW

ZHUHWDEOHVVXFKDV

7DEOH

DQG

7DEOH

ZRXOGQRWEHQHFHVVDU\$OWKRXJKZHGRKDYHDIRUPXODZKLFK

H[SODLQVWKHVHWDEOHVLWLVXQIRUWXQDWHO\EDVHGRQVXEWUDFWLRQ)RUH[DPSOHDFFRUGLQJWRWKHIRUPXODIRUWKH

IRXUELWWDEOHWRJHWWKHQHJDWLYHRI\RXVXEWUDFWIURP%XWVLQFHRXUJRDOLVWRILQGDZD\WRGR

VXEWUDFWLRQZHDSSHDUWREHWUDSSHGLQDYLFLRXVFLUFOH7KHVLWXDWLRQLVQRWDVEDGDVLWVHHPVKRZHYHU

6XEWUDFWLQJIURPLQELQDU\FDQEHGRQHHYHQLIZHGRQ WNQRZKRZWRVXEWUDFWDQGHYHQWKRXJKWKH

ELQDU\UHSUHVHQWDWLRQRIUHTXLUHVRQHPRUHELWWKDQRXUIRXUELWUHJLVWHUVFDQKROG:HDUHVDYHGE\WZR

IDFWV

L [ [O

LL 6XEWUDFWLQJIURPFDQEHGRQHE\MXVWIOLSSLQJWKHELWV1RWLFHZKDWKDSSHQVZKHQZHVXEWUDFW

IURPLQELQDU\

7KHELWVLQDUHIOLSSHGDQGZHJHW:HKDYHKDUGZDUHWKDWFDQIOLSELWV:HFDQIHHGHDFKELWLQWR

D127JDWH$GGLQJWKHQJLYHVWKHUHVXOW

7KHXQXVHGLQSXWFDUU\RQWKHDGGLWLRQFLUFXLWFRPHVLQWRLWVRZQKHUH6HH

VHFWLRQ

,W VMXVWZKDW V

QHHGHGWRDGGWRDWRWDO7KHSURFHVVRIIOLSSLQJWKHELWVDQGDGGLQJRQHLVFDOOHGWZR VFRPSOHPHQWDWLRQ,W
VXEWUDFWVDQXPEHUIURPWKHWXUQRYHUYDOXH7KHWXUQRYHUYDOXHIRUDQQELWWZR VFRPSOHPHQWQXPEHULV

Q



,IQ WKLVYDOXHLV

6RZHPD\GRDVDQDGGLWLRQ

RUWRUHDOO\VHHKRZWKHFRPSXWHUGRHVLW

7KHILQDOFDUU\ELWLVLJQRUHG7KDWLVKRZDFRPSXWHUVXEWUDFWVIURP

7KHXVHRIWKHZRUGFRPSOHPHQWLVMXVWLILHGE\WKHIDFWWKDW

1RWHWKDWWKLVIDLWKIXOO\UHIOHFWVWKHIDFWWKDW

7ZR V&RPSOHPHQWDWLRQLQ+H[

7KHWZR VFRPSOHPHQWSURFHVVLVGRQHE\IOLSSLQJWKHELWVDQGDGGLQJRQH,IZHWKLQNRIIOLSSLQJWKHELWVRI

DKH[GLJLWZHVHHWKDWWKLVFDQEHGRQHE\VXEWUDFWLQJIURP7RGRWKHWZR VFRPSOHPHQWRIDQXPEHULQ

KH[WKHQZHFDQVXEWUDFWHDFKRILWVGLJLWVIURPILIWHHQDQGWKHQDGGRQH)RUH[DPSOHJLYHQDQHLJKWELW

QXPEHU+

+HQFHWKHWZR VFRPSOHPHQWRI+LV''+2QWKHRWKHUKDQGLIZHXVHWKHIDFWWKDWILQGLQJWKHWZR V

FRPSOHPHQWLVUHDOO\VXEWUDFWLRQIURPWKHWXUQRYHUYDOXHZHFDQMXVWGRWKHVXEWUDFWLRQ

&RQYHUVLRQV

:KHQGHEXJJHUVGLVSOD\UHJLVWHUFRQWHQWVIRUXVQHJDWLYHVZLOOEHVKRZQWRXVLQKH[&RQVHTXHQWO\LWLV

ZRUWKZKLOHWREHFRPHKDQG\ZLWKWZR VFRPSOHPHQWYDOXHVLQKH[6XSSRVHZHDUHVKRZQWKHELWYDOXH

))+DQGZHZRXOGOLNHWRNQRZZKDWYDOXHLWUHSUHVHQWV)LUVWZHREVHUYHWKDWLIZHWDNHWKLVWREHD

VLJQHGQXPEHUWKHQLWLVQHJDWLYHVLQFHLWVILUVWELWLV²LIWKHILUVWKH[GLJLWLVDQ\RIWKHKH[GLJLWV

$%&'(RU)WKHQWKHILUVWELQDU\GLJLWLV7RILQGWKHFRUUHVSRQGLQJSRVLWLYHQXPEHUZHFDQ

SHUIRUPWKHWZR VFRPSOHPHQWLQKH[

$QG%(+LVî &RQVHTXHQWO\WKHUHSUHVHQWHGYDOXHLV

<RXFRXOGDOVRFRQYHUWHYHU\WKLQJWRELQDU\WDNHWKHWZR VFRPSOHPHQWDQGWKHQFRQYHUWWRGHFLPDO2I

FRXUVH\RXFRXOGDOVRFRQYHUW))+WRGHFLPDODQGVXEWUDFWWKHUHVXOWIURP3UREDEO\ZRUNLQJLQ

KH[DVPXFKDV\RXFDQLVWKHHDVLHVW

 3ODFHKROGLQJ7ZR V&RPSOHPHQW

7ZR VFRPSOHPHQWFDQEHWKRXJKWRIDVDSODFHKROGLQJV\VWHP,IWKHSODFHYDOXHRIWKHPRVWVLJQLILFDQWELW

LVWKRXJKWRIDVVWDQGLQJIRUWKHQHJDWLYHRILWVRUGLQDU\ELQDU\YDOXHWKHQWKLV\LHOGVDSODFHYDOXH

LQWHUSUHWDWLRQIRUWZR VFRPSOHPHQWQXPEHULQJ

7DEOH

VKRZVWKHSODFHYDOXHVLQWKHIRXUELWWZR V

FRPSOHPHQWV\VWHP8VLQJWKHWDEOHZHVHHWKDWFDQEHH[SUHVVHGDV

0HPRU\&LUFXLWV

7KHODWFKFLUFXLWVKRZQLQ

)LJXUH

KDVWKHSURSHUW\WKDWLIDORJLFLVDSSOLHGWRWKH)UHH]H&RS\OLQH

WKHQWKHYDOXHRQWKH,QSXWSURSDJDWHVWKURXJKWRWKH2XWSXW2QWKHRWKHUKDQGLIDORJLFLVDSSOLHGWRWKH

)UHH]H&RS\OLQHWKHQWKH2XWSXWVLJQDOLVKHOGWRZKDWHYHUYDOXHLWKDGDWWKHWLPHRIWKHIUHH]H7KLV

YDOXHLVLQVWRUDJHDQGWKHLQSXWLVLJQRUHG

7RVHHKRZWKLVFLUFXLWPLJKWVHUYHDVRQHELWRIDPHPRU\FLUFXLWLPDJLQHPDQ\RIWKHVHFLUFXLWVDUUDQJHG

LQDUHFWDQJOHHDFKURZIRUPLQJDZRUGRIPHPRU\(DFKURZZRXOGUHVSRQGWRDVHOHFWLRQVLJQDOSLFNLQJ

WKDWURZRXWIURPDOOWKHRWKHUURZVLQPHPRU\7KHPHPRU\ZRXOGEHUHTXLUHGWRUHPDLQGRUPDQW

ZKHQHYHUWKHVHOHFWLRQVLJQDOZDVQRWSUHVHQW7RXVHWKLVFLUFXLWDVRQHELWRIDPHPRU\OHWXVVXSSRVHZH

KDYHD:5FRQWUROVLJQDODQGDVHOHFWLRQVLJQDO6HO:VWDQGVIRUZULWHZKLFKPHDQVWKDWWKHSURFHVVRU

ZDQWVWRZULWHWRWKHPHPRU\FLUFXLW5VWDQGVIRUUHDGDQGPHDQVWKDWWKHSURFHVVRUZDQWVWRUHDGIURPWKH

PHPRU\FLUFXLW$OOWKHFLUFXLWVLQWKHHQWLUHPHPRU\ZLOOEHFRQQHFWHGWRWKHVDPH:5VLJQDOEXWRQO\

WKHFLUFXLWVLQWKHVDPHZRUGDUHFRQQHFWHGWRDVLQJOH6HOVLJQDO

7DEOH)RXU%LW7ZR V&RPSOHPHQW3ODFH9DOXHV

V

V

V

V

%LQDU\

'HFLPDO





















































































































































































:KHQ6HOLVWKH127JDWHRXWSXWVDZKLFKIUHH]HVWKHFLUFXLW:KHQ6HOLVDQGWKH:5LQSXWLV

PHDQLQJWKHSURFHVVRUZDQWVWRUHDGWKHQDJDLQWKHFLUFXLWUHPDLQVIUR]HQ:KHQ6HOLVDQGWKH:5LV

WKHQWKH127JDWHRXWSXWVDZKLFKFDXVHVWKH'DWD,QWREHVWRUHG

7KLVFLUFXLWZRXOGZRUNDOULJKWH[FHSWIRUWKHIDFWWKDWWKHQXPEHURI'DWDZLUHVIRUWKHHQWLUHPHPRU\LVWKH

VDPHDVWKHQXPEHURIELWVLQRQHZRUG)RUH[DPSOHWKLVPHDQVWKDWWKHOHDVWVLJQLILFDQWELWRIWKHZRUG

PXVWVKDUHLWV'DWD2XWZLUHZLWKWKHFRUUHVSRQGLQJ'DWD2XWZLUHIURPHYHU\RWKHUZRUGLQPHPRU\DV

ZHOODVZLWKWKHFRUUHVSRQGLQJ'DWD,QZLUH7KHVDPHJRHVIRUHDFKRIWKHRWKHUELWV$PHPRU\ZLWKIRXU

ELWZRUGVKDVRQO\IRXUGDWDZLUHVUHJDUGOHVVRIKRZPDQ\ZRUGVLWKDV7RDYRLGFDXVLQJPDVVLYHFRQIOLFWV

FLUFXLWVZKLFKKDYHZKDWLVFDOOHGDWULVWDWHRXWSXWDUHXVHG

7UL6WDWH2XWSXWV

)LJXUH

VKRZVDJHQHULFORJLFJDWH7KHRXWSXWRIWKLVJDWHFDQEHVZLWFKHGHLWKHUWRWKHSRVLWLYHRUWKH

QHJDWLYHSRZHUWHUPLQDO%HFDXVHLWVRXWSXWKDVWZRSRVVLEOHYDOXHVLWLVFDOOHGDWZRVWDWHJDWH

)LJXUH

VKRZVDJHQHULFWULVWDWHORJLFJDWH,WVRXWSXWKDVWKUHHSRVVLEOHYDOXHV7KHRXWSXWRIWKLVJDWHFDQEHD

ORJLFRUDORJLFEXWWKHRXWSXWFDQDOVREHVZLWFKHGWRDGLVFRQQHFWHGVWDWHVRWKDWWKHRXWSXWLVQRW

KRRNHGXSWRDQ\WKLQJ7KLVLVVRPHWLPHVUHIHUUHGWRDVDGRQ WFDUHVWDWHDQGLVVRPHWLPHVGHQRWHGE\WKH

OHWWHU;:KHQDORJLFJDWHVZLWFKHVWRWKLVVWDWHLWUHOHDVHVFRQWURORYHULWVRXWSXW,IWKHUHLVFRQIOLFWRQWKH

KRUL]RQVZLWFKLQJWRWKLVVWDWHLVDJRRGZD\WRDYRLGLW$VLPSOHWULVWDWHFLUFXLWLVWKHWULVWDWHEXIIHU

ZKRVHWUXWKWDEOHLVJLYHQLQ

7DEOH

7KHV\PEROIRUWKLVFLUFXLWLV

)LJXUH$7UL6WDWH/RJLF*DWH

7DEOH7UXWK7DEOHIRU7UL6WDWH%XIIHU

&RQWURO

,QSXW

2XWSXW





;





;













:KHQDWULVWDWHEXIIHULVDGGHGWRWKHODWFKDVVKRZQLQ

)LJXUH

WKHGDWDZLUHFDQEHVKDUHGE\WKHLQSXW

DQGWKHRXWSXW7KHSURFHVVRURIFRXUVHQHHGVDWULVWDWHEXIIHURQLWVHQGWRR7KLVFLUFXLWKDVRQO\WKUHH

H[WHUQDOFRQQHFWLRQV6XSSRVHZHUHSUHVHQWLWDVIROORZVDVVKRZQLQ

)LJXUH

)RXURIWKHVHFLUFXLWVXVHG

LQSDUDOOHOFRXOGVWRUHIRXUELWVDOOXQGHUWKHFRQWURORIWKHVDPHWZRVLJQDOV:5DQG6HO

)LJXUH$2QH%LW0HPRU\&LUFXLW

)LJXUH2QH%LW0HPRU\

6XSSRVHZHUHSUHVHQWDIRXUELWPHPRU\OLNHWKLV

)LJXUH

VKRZVDPHPRU\FRQVLVWLQJRIIRXURIWKHVHFLUFXLWV7ZRDGGUHVVZLUHVVXIILFHWRDGGUHVVWKLV

PHPRU\7KLVPHPRU\FLUFXLWKDVIRXUZRUGV(DFKZRUGKROGVIRXUELWV7KHGDWDZLUHV'2''DQG

'DUHDOOVKDUHG7KHDGGUHVVZLUHV$DQG$OFRQWUROWKHIRXUGLIIHUHQW6HOLQSXWV7KHDGGUHVVZLUHVVHOHFW

ZKLFKRIWKHIRXU6HOZLUHVLVVHOHFWHG7KHRWKHUWKUHHZLOOKDYHWKHYDOXH,WLVQRWSRVVLEOHWRWXUQRQWZR

DWDWLPH

)LJXUH)RXU:RUG0HPRU\(DFK:RUG+ROGV)RXU%LWV

,IZHLPDJLQHWKLVDVWKHPHPRU\RIDWLQ\OLWWOHFRPSXWHUWKHQWKLVFRPSXWHUZRXOGKDYHDIRXUELWGDWD

EXVDWZRELWDGGUHVVEXVDQGDRQHELWFRQWUROEXV7RIHWFKDQLWHPIURPPHPRU\WKHSURFHVVRUIRUWKLV

OLWWOHFRPSXWHUZRXOGSXWLWV:5SLQDWORJLFDQGDWZRELWDGGUHVVRQWKHDGGUHVVEXV7KLVZRXOG

DFWLYDWHWKH6HOVLJQDOIRUH[DFWO\RQHZRUGRIPHPRU\,IZHLPDJLQHDIHWFKH[HFXWHF\FOHLQSURJUHVVWKH

SURFHVVRUZRXOGQHHGDWZRELWUHJLVWHUWRNHHSWUDFNRIWKHDGGUHVVRIWKHLQVWUXFWLRQLWZDVH[HFXWLQJ$OO

SURFHVVRUVSHUIRUPLQJWKHIHWFKH[HFXWHF\FOHQHHGVXFKDUHJLVWHU,WLVRIWHQFDOOHGWKH3URJUDP&RXQWHU

,Q,QWHOPDFKLQHVLWLVFDOOHGWKH,QVWUXFWLRQ3RLQWHU

'HILQLWLRQRI0HPRU\&DSDFLW\

$Q\SK\VLFDOPHPRU\LVDQREMHFWRUGHYLFHZKLFKLVVWDEOHLQPRUHWKDQRQHVWDWH,WVFDSDFLW\LVWKHQXPEHU

RILWVVWDEOHVWDWHV6LQFHDFRPSXWHUPHPRU\LVODLGRXWDVDUHFWDQJOHRIREMHFWVZLWKWZRVWDEOHVWDWHVHDFK
WKHQXPEHURIVWDEOHVWDWHVLQWKHPHPRU\LV

OîZ

ZKHUHODQGZDUHWKHOHQJWKDQGZLGWKRIWKHUHFWDQJOHO

LVDOVRFDOOHGWKHQXPEHURIZRUGVDQGZLVWKHZLGWKRIHDFKZRUGLQELWV)RUFRQYHQLHQFHWKHFDSDFLW\LV

RIWHQJLYHQLQELWVDVMXVWOîZLHWKHEDVHWZRORJDULWKPRIWKHQXPEHURIVWDEOHVWDWHV7KHFDSDFLW\LQ

E\WHVRIFRXUVHLVRQHHLJKWKRIWKHFDSDFLW\LQELWV

65$0YV'5$0

:KHQPHPRU\FLUFXLWVDUHEXLOWRXWRIORJLFFLUFXLWVLWLVFDOOHGVWDWLFPHPRU\RU65$00HPRU\FLUFXLWV

FDQDOVREHPDGHRXWRIFDSDFLWRUV$FKDUJHGFDSDFLWRUUHSUHVHQWVDVWRUHGDGLVFKDUJHGFDSDFLWRU

UHSUHVHQWVDVWRUHG6LQFHIHZHUWUDQVLVWRUVDUHUHTXLUHGWKHVHFLUFXLWVFDQEHSDFNHGZLWKJUHDWHUGHQVLW\

RQDFKLS6PDOOFORVHO\SDFNHGFDSDFLWRUVKDYHWKHGLVDGYDQWDJHWKDWWKH\GLVFKDUJHUDSLGO\7KH\UHTXLUH

FRQVWDQWUHFKHFNLQJ(YHU\FDSDFLWRUZKLFKLVQRWFRPSOHWHO\GLVFKDUJHGPXVWEHSXPSHGEDFNXSDJDLQ

%HFDXVHWKHPHPRU\LVEHLQJFRQVWDQWO\UHIUHVKHGLWLVFDOOHGG\QDPLFPHPRU\RU'5$0'\QDPLF

PHPRU\LVOLNHDERRNVKHOIZLWKRXWWKHVKHOIH[FHSWWKDWLQWKHFDVHRIDERRNIDOOLQJIRXUIHHWVD\WRWKH

IORRU\RXZRXOGKDYHVHFRQGVWRFDWFKLWEHIRUHLWKLWWKHIORRU7KHVHOLWWOHFDSDFLWRUVGLVFKDUJHLQ

VHFRQGV7KHPHPRU\UHIUHVKPXVWEHGRQHDSSUR[LPDWHO\HYHU\—V8QOLNHPDQ\GHYHORSPHQWVZKLFK

KDYHQXPHURXVFRQWULEXWRUVG\QDPLFPHPRU\ZDVLQYHQWHGE\DVLQJOHSHUVRQ7HG+RIIDURXQG

'\QDPLFPHPRU\LVFKHDSHUDQGVORZHUWKDQVWDWLFPHPRU\6WDWLFPHPRU\LVXVXDOO\XVHGIRUFDFKH

PHPRU\ZKLOHG\QDPLFPHPRU\LVXVHGIRU5$0

2QHGUDZEDFNRI'5$0LVWKDWLWPDNHVKDUGZDUHGHEXJJLQJPXFKPRUHGLIILFXOW7KHVLPSOHVWZD\WRGR

KDUGZDUHGHEXJJLQJZRXOGEHWRVORZWKHFRPSXWHU VFORFNZD\GRZQ$EHUUDQWEHKDYLRUFRXOGWKHQEH

REVHUYHGDVLWKDSSHQHG%XWEHFDXVHRI'5$0 VUDSLGUHIUHVKUHTXLUHPHQWVWKHUHLVQRHDV\ZD\WRGRWKLV

[*HQHUDO5HJLVWHUVDQGWKHLU$QFHVWU\

2QHRIWKHUHDVRQVEHKLQGWKHPDUNHWVXFFHVVRIWKH,QWHO[OLQHRISURFHVVRUVKDVEHHQWKDWHDFKQHZ

SURFHVVRULQWKHOLQHZDVGHVLJQHGVXEMHFWWRWKHUHTXLUHPHQWWKDWLWEHFRPSDWLEOHZLWKSUHYLRXVSURFHVVRUV

,QWHOQHYHUZLSHGWKHVODWHFOHDQDQGVWDUWHGIURPVFUDWFKDV0RWRURODDQG,%0GLGZLWKWKH3RZHU3&FKLS

DQG'(&GLGZLWKWKH$OSKDSURFHVVRU7KLVPLQLPL]HGWKHDPRXQWRIKDUGZDUHDQGVRIWZDUHUHWRROLQJ

QHFHVVLWDWHGE\DQXSJUDGH&RQVHTXHQWO\DGHVFULSWLRQRIWKH[DQGLQSDUWLFXODULWVUHJLVWHUVOHQGVLWVHOI

WRDKLVWRULFDODSSURDFK:HEHJLQZLWKWKHSURFHVVRU

5HJLVWHUV

7KHZDVWKHILUVWUHDOO\PDVVSURGXFHGPLFURSURFHVVRU,WZDVXVHGDVWKH&38LQVHYHUDOHDUO\

PLFURFRPSXWHUVLQFOXGLQJWKH$WDUL7KLVSURFHVVRUKDVUHJLVWHUV$%&'+DQG/ZKLFKDUHDOOHLJKW

ELWUHJLVWHUV7KHYHU\ILUVWSHUVRQDOFRPSXWHUDOVRXWLOL]HGWKHSURFHVVRU,WZDVWKH$OWDLUZKLFK

DSSHDUHGRQWKHFRYHURI3RSXODU6FLHQFHPDJD]LQHRI-DQXDU\7KHIDFWWKDWLWVUHJLVWHUVPHPRU\

DGGUHVVHVDQGGDWDWUDQVIHUVZHUHDOOHLJKWELWVLQVL]HPDNHVWKLVFRPSXWHUDYHU\JRRGH[DPSOHRIDQ

HLJKWELWFRPSXWHU$OOWKHUHJLVWHUVVKRZQDUHHLJKWELWUHJLVWHUV7KHDGGUHVVEXVDQGWKHGDWDEXVHDFK

KDYHHLJKWZLUHV

)LJXUH$OWDLU&RPSXWHU

7KH/UHJLVWHULVXVHGWRVWRUHDGGUHVVHV7KH$OWDLUPHPRU\KDVE\WHVQXPEHUHGWR7KLVPHPRU\LV

VKRFNLQJO\VPDOOEXWRQWKHRWKHUKDQGLWZDVILOOHGRQHE\WHDWDWLPHE\IOLSSLQJHLJKWELWVZLWFKHV

7KHUHDUHH[WDQWYHUVLRQVRIWKHRQWKHPDUNHWWKHDQGWKH=5DGLR6KDFN V756ZDVEDVHG

RQWKH=

:KHQ,%0LQWURGXFHGWKH3&WKH\FKRVHWKH,QWHODVLWVSURFHVVRUEHFDXVHLQLWVGHDOLQJVZLWK

PHPRU\DQGWKHV\VWHPERDUGLWDFWVOLNHDQHLJKWELWSURFHVVRU,QSDUWLFXODULWDFWVDORWOLNHWKH

SURFHVVRU

5HJLVWHUV

$OWKRXJKWKH$OWDLUZDVDQHDUO\SXUHH[DPSOHRIDQHLJKWELWFRPSXWHUWKHSURFHVVRUGLGKDYHVRPH

ELWIHDWXUHV,QSDUWLFXODULWZDVGHVLJQHGVRWKDWLWFRXOGEHXVHGZLWKDELWPHPRU\DGGUHVVLQJ

V\VWHP,WGLGWKLVE\DOORZLQJWZRRIWKHHLJKWELWUHJLVWHUVWKH+DQGWKH/WRSDLUXSDQGIRUPDELW

UHJLVWHUZKLFKFRXOGWKHQEHXVHGIRUDGGUHVVHV:KHQWKLVKLJKE\WHORZE\WHSDLUZDVUHIHUHQFHGE\D

FRPPDQGDQ;ZDVXVHGLQWKHFRPPDQG)RUH[DPSOHWKHELWLQFUHPHQWFRPPDQGZDV,1;7KHHLJKW

ELWFRPPDQGZDV,157KH;VWRRGIRUH[WHQGHGDQGZDVXVHGZKHQHYHUELWUHJLVWHUSDLUVZHUHEHLQJ

UHIHUHQFHG:KHQWKHELWSURFHVVRUVKRZQLQ

)LJXUH

ZDVGHVLJQHGWKLV;ZDVUHFUXLWHGIRU

XVHLQWKHELWUHJLVWHUGHVLJQDWLRQV$;%;&;DQG';7KHELWUHJLVWHUV$;%;&;DQG';DUH

SDLUVRIKLJKDQGORZE\WHUHJLVWHUV$+DQG$/%+DQG%/&+DQG&/'+DQG'/7KHRWKHUELW

UHJLVWHUV63%36,DQG',KDYHQR;LQWKHLUQDPHVDQGDUHQRWE\WHSDLUV7KHGDWDEXVKDVZLUHV
$OVRVKRZQDUHWKH 



PHPRU\ORFDWLRQVLQRQHPHPRU\VHJPHQW,QVSLWHRIWKHDERYH

SLFWXUHWKHLVQRWUHDOO\DJRRGH[DPSOHRIDELWFRPSXWHU7KHDGGUHVVEXVKDVZLUHVDQGWKHUH

LVDFOXPV\PHFKDQLVPIRUXVLQJDKDQGIXORIVHJPHQWVDWDWLPH6RWKHPHPRU\LVQRWDFWXDOO\OLPLWHGWR
.EXWWKHUHLVQRFRQYHQLHQWZD\WRXVHDOO



E\WHVDWRQFH

)LJXUH&RPSXWHU3DUWLDO0RGHO

5HJLVWHUV

0DQ\RIWKHZULQNOHVYLVLEOHLQWKHGHVLJQRIWKHDUHVPRRWKHGRXWLQWKHVKRZQLQ

)LJXUH



7KHHLJKWUHJLVWHUVZKRVHQDPHVEHJLQZLWK(DUHDOOH[WHQVLRQVRIWKHFRUUHVSRQGLQJUHJLVWHUVRQWKH

7KHERWWRPKDOIRIHDFKELWUHJLVWHULVDELWUHJLVWHULQKHULWHGIURPWKH7KHDGGUHVVEXVDQGWKH
GDWDEXVHDFKKDYHZLUHV$OVRVKRZQDUHWKH 



PHPRU\ORFDWLRQVZKLFKDQLV

FDSDEOHRIDGGUHVVLQJ$QFRPSXWHULVDYHU\JRRGH[DPSOHRIDELWFRPSXWHU7KHDQGWKH

3HQWLXPDUHDOVRELWSURFHVVRUV,QIDFWLQWHUPVRIUHJLVWHUVVL]HVPHPRU\DGGUHVVLQJDQGVRRQWKHUH

DUHQRFKDQJHVDWDOO8SXQWLOWKH3HQWLXP,,DQG3HQWLXP3URZHUHUHOHDVHGWKHPDLQGHYHORSPHQWV

FRQVLVWHGLQLQFUHDVLQJWKHVSHHGZLWKRXWFKDQJLQJWKHEDVLFDUFKLWHFWXUH

)LJXUH

FRXOGMXVWDVZHOOEH

ODEHOHG3HQWLXP&RPSXWHUDV&RPSXWHUH[FHSWWKDWWKH3HQWLXPKDVDELWGDWDEXV

)LJXUH&RPSXWHU3DUWLDO0RGHO

7KH

029

&RPPDQG

7KLVVHFWLRQLQWURGXFHVWKH

029

FRPPDQG,WLVDYHU\LPSRUWDQWLQVWUXFWLRQ

029

LVDVWRUDJHFRPPDQG,W

FRSLHVDYDOXHLQWRDORFDWLRQ,WKDVPDQ\GLIIHUHQWYDOLGIRUPV7KHUHJLPPDQGUHJUHJIRUPVDUH

HVSHFLDOO\LPSRUWDQW



029

UHJLPP

z

UHJVWDQGVIRUUHJLVWHU,WPD\EHDQ\RIWKHUHJLVWHUVOLVWHGLQ

7DEOH



z

LPPVWDQGVIRULPPHGLDWH7KHWHUPLPPHGLDWHLVXVHGWRUHIHUWRDQXPHULFDOYDOXHJLYHQGLUHFWO\E\

DGHFLPDORUKH[DGHFLPDOUHSUHVHQWDWLRQDVRSSRVHGWRDUHJLVWHURUPHPRU\ORFDWLRQFRQWDLQLQJWKDW

YDOXH

)RUH[DPSOHLQ

029$;

WKHQXPEHURFFXUVDVDQLPPHGLDWHYDOXH7KLVFRPPDQGVWRUHVWKHQXPEHULQWRWKHELWUHJLVWHU

$;7KLVUHJLVWHULVWKHVDPHDVWKHERWWRPELWVRIWKHUHJLVWHU($;7KHWRSELWVDUHXQPRGLILHG

6LQFH +WKHFRPPDQGLVWKHVDPHDVWKHFRPPDQG

029$;+

7KHYDOXHDVVLJQHGWRWKHORFDWLRQPXVWILW7KHFRPPDQG

029$/

LVQRWYDOLGEHFDXVHZLOOQRWILWLQWRDQHLJKWELWUHJLVWHU1$60DQG(GOLQDVDOORZVLJQHGLQWHJHUV

+HQFH

029$/±

LVYDOLGDQGGRHVWKHVDPHWKLQJDV

029$/

%XWLVQRWYDOLGLQ(GOLQDVEHFDXVHLVQRWLQWKHHLJKWELWVLJQHGUDQJH1$60GRHVQ WEDONXQWLOLWJHWV

WR1$60DOORZVFKDUDFWHUVWRUHSUHVHQW$6&,,FRGHV)RUH[DPSOH

029$/±

029$/ $

VWRUHVWKH$6&,,FRGHIRUWKHOHWWHU$ZKLFKLVLQ$/

&RGHXVLQJELWUHJLVWHUVZLOOQRWUXQRQ[SURFHVVRUVSULRUWRWKH$OWKRXJKLWLVDFKDUDFWHULVWLF

RIVRFDOOHGELWFRGHWRXVHELWUHJLVWHUVVRPHELWFRGHGRHVDOVR7KHDFWXDOGLIIHUHQFH

EHWZHHQDQGELWFRGHLVGLVFXVVHGLQ

FKDSWHU



VHFWLRQ





029

UHJUHJ

029

UHJUHJFRSLHVIURPWKHVHFRQGUHJLVWHULQWRWKHILUVW7KHWZRRSHUDQGFRPPDQGVGHVFULEHGLQWKLVERRN

XVHWKHV\QWD[&200$1'GHVWLQDWLRQVRXUFH+HQFHWKHFRPPDQG

7DEOH[*HQHUDO5HJLVWHUV

ELW

ELW

ELW

$+

$;

($;

$/

%;

(%;

%+

&;

(&;

%/

';

(';

&+

%3

(%3

&/

63

(63

'+

6,

(6,

'/

',

(',

029($;(%;

GRHVQRWFKDQJHWKH(%;UHJLVWHU,WPHDQV

OHW($; (%;

QRWPRYH($;WR(%;

7KHUHDUHDVVHPEOHUVZKLFKXVHWKHRSSRVLWHV\QWD[VXFKDVWKH$7 7VW\OHDVVHPEOHUXVHGE\JFF,QLWV

V\QWD[WKHH[DFWVDPHFRPPDQGLVZULWWHQ

PRYOHE[HD[

7KHWZRUHJLVWHUVXVHGLQD

029

FRPPDQGPXVWEHWKHVDPHVL]H7KHIROORZLQJFRPPDQGIRUH[DPSOHLV

QRWYDOLG

029(%;';

$PELJXLW\3UREOHP

$FFRUGLQJWRWKHDSSHQG+KH[FRQYHQWLRQGLVFXVVHGLQ

FKDSWHU



VHFWLRQ

WKHUHJLVWHUQDPHV$+%+

&+DQG'+DUHDOVRYDOLGKH[DGHFLPDOQDPHVIRUWKHQXPEHUVWHQHOHYHQWZHOYHDQGWKLUWHHQ7KLVZRXOG

PDNHFRPPDQGVVXFKDV

029%/$+

DPELJXRXV7KLVFRPPDQGZRXOGEHDYDOLGH[DPSOHRIERWKWKHUHJUHJIRUPDQGWKHUHJLPPIRUPRIWKH

029

FRPPDQG7KHFXVWRPDU\UHVROXWLRQRIWKLVDPELJXLW\LVWRUHTXLUHDOOKH[DGHFLPDOQXPEHUVXVHGLQ

DVVHPEO\ODQJXDJHFRPPDQGVWREHJLQZLWKRQHRIWKHGLJLWV«7KLVPRGLILFDWLRQRIWKHDSSHQG+

FRQYHQWLRQZLOOEHREVHUYHGLQWKLVWH[WDQGLVUHTXLUHGE\ERWK1$60DQG(GOLQDV+HQFH

029%/$+

LV

DFWXDOO\QRWDYDOLGH[DPSOHWKHUHJLPPIRUP,WLVDQH[DPSOHRIWKHUHJUHJIRUP7RVWRUHWKHLPPHGLDWH

YDOXHWHQLQWR%/ZHPXVWXVHHLWKHU

029%/$+

RU

029%/

$GGLWLRQDQG6XEWUDFWLRQ&RPPDQGV

7KLVVHFWLRQGHVFULEHVWKHUHJLPPDQGUHJUHJIRUPVRIWKH

$''

DQG

68%

FRPPDQGV7KHVHDUHYHU\

IXQGDPHQWDODULWKPHWLFLQVWUXFWLRQV



$''

UHJLPP

$''UHJLPP

PHDQVWRDGGWKHLPPHGLDWHYDOXHWRWKHUHJLVWHU)RUH[DPSOH

$''%/

FDQEHWKRXJKWRIDV

OHW%/ %/



$''

UHJUHJ

7KHFRPPDQG

$''UHJUHJ

PHDQVWRDGGWKHFRQWHQWVRIWKHVHFRQGUHJLVWHUWRWKHILUVW6RWKHFRPPDQG

$''%/$/

PHDQV

OHW%/ %/$/

7KHUHJLVWHU$/LVQRWFKDQJHGE\WKLVFRPPDQG



68%

UHJLPP

7KHFRPPDQG

68%%/

IRUH[DPSOHPHDQV

OHW%/ %/



68%

UHJUHJ

68%%/$/

IRUH[DPSOHPHDQV

OHW%/ %/$/

 0XOWLSOLFDWLRQDQG'LYLVLRQ&RPPDQGV

,IWKHPXOWLSOLFDWLRQFRPPDQGZHUHWRIXQFWLRQVLPLODUO\WRWKH

$''

DQG

68%

FRPPDQGZHZRXOGH[SHFWWR

VHHFRPPDQGVVXFKDV

08/($;(%;

ZKLFKZRXOGPHDQWRPXOWLSO\WKHFRQWHQWVRIWKHUHJLVWHU($;E\WKHYDOXHLQ(%;+RZHYHUWKHPXOWLSO\

FRPPDQGGRHVQRWZRUNOLNHWKLV2QHUHDVRQLVWKDWEHFDXVHPXOWLSO\LQJQXPEHUVWRJHWKHUW\SLFDOO\

GRXEOHVWKHPLQVL]HLWGRHVQRWPDNHVHQVHWRXVHWKHVDPHVL]HUHJLVWHUVIRUWKHDQVZHUDVIRUWKH

PXOWLSOLHGQXPEHUV

7KH

08/

&RPPDQG

7KHV\QWD[IRUWKHPXOWLSO\FRPPDQGLV

08/UHJ

UHJPD\EHDQ\RIWKHJHQHUDOUHJLVWHUVOLVWHGLQ

7DEOH

,IWKHUHJLVWHUXVHGLVDQHLJKWELWUHJLVWHUIRU

H[DPSOH

08/%+

WKHQWKHFRPPDQGPHDQV

OHW$; $/‡%+

:KHQDQHLJKWELWUHJLVWHULVXVHGLWDOZD\VPXOWLSOLHVE\$/DQGVWRUHVWKHUHVXOWLQ$;:KHQDELW

UHJLVWHULVXVHGIRUH[DPSOH

08/%;

WKHQWKHFRPPDQGPHDQV

OHW';$; $;‡%;

ZKHUHWKHELWDQVZHULVVWRUHGLQWZRELWUHJLVWHUV7KHWRSELWVDUHVWRUHGLQ';WKHERWWRPELWV

LQ$;:KHQDELWUHJLVWHULVXVHGIRUH[DPSOH

08/(%;

WKHQWKHFRPPDQGPHDQV

OHW(';($; ($;‡(%;

$VLQJOHUHJLVWHULVDOOWKDW\RXVSHFLI\ZKHQ\RXXVHWKH

08/

FRPPDQG7KHRWKHUUHJLVWHUVDUHDOZD\V

LPSOLHG7KHVLWXDWLRQLVVLPLODUWRWKDWZLWKWKH

$''

FRPPDQGRQWKHSURFHVVRUZKHUHDGGLWLRQUHVXOWV

DUHDOZD\VVWRUHGLQWKH$UHJLVWHU7KHFRPPDQG

$''%

LQDVVHPEO\ODQJXDJHPHDQV

OHW$ $%

8QOLNHWKH

$''

DQG

68%

FRPPDQGVWKH

08/

FRPPDQGKDVQRLPPHGLDWHIRUP7KHFRPPDQG

08/

LVQRWYDOLG

7KH

',9

&RPPDQG

7KH

',9

FRPPDQGFORVHO\UHVHPEOHVWKH

08/

FRPPDQGLQV\QWD[DQGLVHVVHQWLDOO\LWVLQYHUVH,WIRUPVERWK

DTXRWLHQWDQGDUHPDLQGHU

)RUH[DPSOHLI$;KHOGWKHYDOXHDQG%+KHOGWKHYDOXHWKHQ

',9%+

ZRXOGVWRUHLQ$+DQGLQ$/7KHFRPPDQGZRXOGEHUHFRJQL]HGDVDQHLJKWELWFRPPDQGEHFDXVH%+

LVDQHLJKWELWUHJLVWHU

'LYLVLRQE\]HURSURGXFHVDQHUURUFDOOHGDQH[FHSWLRQ([FHSWLRQVDUHGHDOWZLWKLQ

FKDSWHU



,WLVLPSRUWDQWWRQRWHWKDWEHFDXVHRIWKHVL]HVRIWKHUHJLVWHUVLQYROYHGLQGLYLVLRQ]HURLVQRWWKHRQO\

GLYLVRUZKLFKFDQFDXVHDQH[FHSWLRQ)RUH[DPSOHZKHQ$;LVGLYLGHGE\DQXPEHUVWRUHGLQDQHLJKWELW

UHJLVWHUWKHTXRWLHQWLVVXSSRVHGWREHVWRUHGLQ$/DQHLJKWELWUHJLVWHU%XWGLYLGLQJDELWQXPEHUE\

DQHLJKWELWQXPEHUGRHVQRWDOZD\VSURGXFHDQXPEHUZKLFKFDQEHVWRUHGLQHLJKWELWV)RUH[DPSOH

· RULQKH[+· +%XW+UHTXLUHVDWOHDVWWHQELWVRIVWRUDJH7KLVPHDQVWKDWWKH

GLYLGHQG

UHPDLQGHU

TXRWLHQW

ELWIRUP

(';($;

(';

($;

ELWIRUP

';$;

';

$;

ELWIRUP

$;

$+

$/

IROORZLQJFRGHZLOOFDXVHDQH[FHSWLRQ

029$;+

029%+

',9%+

7KLVHUURULVFDOOHGDGLYLVLRQRYHUIORZ

1HJDWLYH1XPEHUVDQG&RQJUXHQFHV

7ZR VFRPSOHPHQWUHSUHVHQWDWLRQLVXVHGIRUQHJDWLYHQXPEHUVLQSDUWEHFDXVHLWDOORZVDGGLWLRQDQG

VXEWUDFWLRQKDUGZDUHWREHXVHGLUUHVSHFWLYHRIZKHWKHUWKHELWVEHLQJRSHUDWHGRQDUHLQWHQGHGDVVLJQHG

LQWHJHUVRUDVXQVLJQHGLQWHJHUV7KHPDWKHPDWLFDOH[SODQDWLRQIRUZK\WZR VFRPSOHPHQWUHSUHVHQWDWLRQ

ZRUNVOLNHWKLVLVEDVHGRQDFRQFHSWGXHWR&)*DXVVDUHPDUNDEOHQLQHWHHQWKFHQWXU\PDWKHPDWLFLDQ

*DXVVGHILQHGD EPRGPWRPHDQWKDWDDQGEGLIIHURQO\E\VRPHH[DFWPXOWLSOHRIP,QWZR V

FRPSOHPHQWUHSUHVHQWDWLRQDQHJDWLYHQXPEHUDQGWKHSRVLWLYHQXPEHUXVHGWRUHSUHVHQWLWGLIIHUE\WKH

WXUQRYHUYDOXHRIWKHUHJLVWHUVEHLQJXVHG,IIRXUELWUHJLVWHUVDUHEHLQJXVHGWKHQHDFKQHJDWLYHDQGLWV
SRVLWLYHUHSUHVHQWDWLRQGLIIHUE\



RUDVVKRZQLQ

7DEOH

,Q*DXVV QRWDWLRQIRUH[DPSOH 

PRG6RZKHQWKHFRPSXWHUGRHVDVLWGHSHQGVRQWKHIDFWWKDW  

PRG7KHIRXUELWDGGLWLRQKDUGZDUHSURGXFHVEHFDXVHDFDUU\RILVORVW%XWWKDWLVRND\(OHYHQ

LVWKHFRUUHFWUHSUHVHQWDWLYHIRU

&RQJUXHQFH$GGLWLRQ7KHRUHP

7KLVUHDVRQLQJLVVXPPDUL]HGLQWKHIROORZLQJWKHRUHPGXHWR*DXVV

7KLVWKHRUHPVD\VWKDWFRQJUXHQFHVFDQEHDGGHGMXVWOLNHHTXDWLRQV*DXVVGHYLVHGWKHFRQJUXHQFHQRWDWLRQ

LQRUGHUWRPDNHWKHSRLQWWKDWDFRQJUXHQFHLVVLPLODUWRDQHTXDWLRQ

&RQJUXHQFH0XOWLSOLFDWLRQ7KHRUHP

7KHIROORZLQJWKHRUHPVWDWHVWKDWFRQJUXHQFHVFDQDOVREHPXOWLSOLHGMXVWOLNHHTXDWLRQV

%HFDXVHRIWKLVQLFHWKHRUHPZHVKRXOGEHDEOHWRXVHERWKVLJQHGDQGXQVLJQHGQXPEHUVZLWK

08/

MXVWOLNH

$''

DQGKDYHQRSUREOHPV([FHSWIRURQHWKLQJ

:HZDQWWRGRXEOHWKHUHJLVWHUVL]HDVZHJR6RWKHWKHRUHPZHUHDOO\QHHGLVWKLVRQH

8QIRUWXQDWHO\WKLVLVQ WDWKHRUHP,W VDIDOVHKRRG)RUH[DPSOHLQWKHHLJKWELWFDVHZKHUHP DQGP



LID E DQGF G ZHJHWD ‡F DQGE ‡G 6RWKHWKHRUHPVD\V

5HPRYLQJWKHHLJKWELWWXUQRYHUYDOXHRIIURPOHDYHV+HQFHLIZHFRQVLGHUHGWKHDQVZHUWREH

XQVLJQHGRUVLJQHGWKHQHYHU\WKLQJZRXOGEHRND\7ZRKXQGUHGWZHQW\IRXULVWKHWZR V

FRPSOHPHQWSRVLWLYHWKDWLVHTXLYDOHQWWRLQWKHHLJKWELWV\VWHP%XWZH UHQRWFRQWHQWZLWKHLJKWELWV

:HZDQW$QG

,QWKHELWV\VWHPLVUHSUHVHQWHGE\QRW&RQVHTXHQWO\ZHFDQ WXVH

08/

RU

',9

IRUERWK

VLJQHGDQGXQVLJQHGQXPEHUV

08/

DQG

',9

ZRUNIRUXQVLJQHGQXPEHUV7KHUHDUHGLIIHUHQWFRPPDQGV

ZKLFKZRUNIRUVLJQHGQXPEHUV

,08/

DQG

,',9

7KLVLVDQH[DPSOHRIWKHLVVXHUDLVHGLQ

VHFWLRQ



)XUWKHU5HDGLQJ

7KH0LFURSURFHVVRU$%LRJUDSK\0LFKDHO60DORQH6SULQJHU

7KH$QDWRP\RID+LJK3HUIRUPDQFH0LFURSURFHVVRU6KULYHUDQG6PLWK,(((

&KDSWHU$66(0%/</$1*8$*(

$FRPSXWHUSURJUDPLVVRPHWKLQJZKLFKFDQEHVWRUHGLQDFRPSXWHU VPHPRU\,IWKHPHPRU\KDVRQHE\WH

ZRUGVZHFDQWKHQVD\WKDWWKHFRPSXWHUSURJUDPFRQVLVWVRIE\WHV7KHVHE\WHVDUHDOVRFDOOHGPDFKLQH

ODQJXDJH:ULWLQJDSURJUDPE\OLVWLQJWKHVHE\WHVH[SOLFLWO\LVFDOOHGPDFKLQHODQJXDJHSURJUDPPLQJ,WLV

WKHRULJLQDOIRUPRISURJUDPPLQJ,WLVGHILQLWHO\WKHPRVWWHGLRXV$VVHPEO\ODQJXDJHZDVGHYLVHGDVD

ZD\RIVSHFLI\LQJPDFKLQHFRGHZLWKRXWDFWXDOO\KDYLQJWRZULWHLWGRZQ$VVHPEO\ODQJXDJHPD\EHPHUH

VKRUWKDQGRULWPD\LQYROYHFRPSOH[PDFURVVRPHRIZKLFKPD\HYHQUHVHPEOH

LI

RU

ZKLOH

VWDWHPHQWVLQ

&%XWZKHWKHULWLVSULPLWLYHRUIDQF\LWVGHILQLQJFKDUDFWHULVWLFLVWKDWLWJLYHVWKHSURJUDPPHUFRQWURORYHU

WKHPDFKLQHODQJXDJH

7KUHHJRRGUHDVRQVIRUOHDUQLQJDVVHPEO\ODQJXDJHDUH

 ,QWUXO\WLPHFULWLFDOVHFWLRQVRIFRGHLWLVVRPHWLPHVSRVVLEOHWRLPSURYHSHUIRUPDQFHE\FRGLQJLQ

DVVHPEO\ODQJXDJH

 ,WLVDJRRGZD\WROHDUQKRZDSDUWLFXODU&38ZRUNV

 ,QZULWLQJDQHZRSHUDWLQJV\VWHPRULQSRUWLQJDQH[LVWLQJV\VWHPWRDQHZPDFKLQHWKHUHDUH

VHFWLRQVRIFRGHZKLFKPXVWEHZULWWHQLQDVVHPEO\ODQJXDJH

$VVHPEO\ODQJXDJHVDUHZULWWHQWRILWKDQGLQJORYHZLWKDVSHFLILFSURFHVVRU*LYHQWKHFRQVLGHUDEOH

YDULHW\RISURFHVVRUVDQGLQVWUXFWLRQVHWVRQHPLJKWH[SHFWWKHUHWREHDFRQVLGHUDEOHYDULHW\LQWKH

LQVWUXFWLRQIRUPDWVIRUWKHYDULRXVDVVHPEO\ODQJXDJHVDVZHOO%XWWKLVLVQRWWKHFDVH$VVHPEO\ODQJXDJHV

JHQHUDOO\IROORZRQHXQLYHUVDOIRUPDWZKLFKPLJKWEHFDOOHGWKHIRXUILHOGIRUPDW

7KH)RXU)LHOG)RUPDW

$FFRUGLQJWRWKLVIRUPDWHYHU\DVVHPEO\ODQJXDJHSURJUDPFRQVLVWVRIOLQHV(YHU\OLQHFRQVLVWVRIIRXU

ILHOGV7KHIRXUILHOGVDUHWKHODEHOILHOGWKHPQHPRQLFILHOGWKHRSHUDQGILHOGDQGWKHFRPPHQWILHOG

 7KHODEHOILHOGLVXVHGIRUDODEHOZKLFKVSHFLILHVWKHWDUJHWRIDMXPSLQVWUXFWLRQ$MXPSLVWKHVDPH

DVDJRWRLQVWUXFWLRQ([DPSOHVRIMXPSLQVWUXFWLRQVDUHJLYHQLQ

VHFWLRQ



 7KHPQHPRQLFILHOGFRQWDLQVDQLQVWUXFWLRQVSHFLILHU([DPSOHVRIPQHPRQLFVDUH

029$''68%

HWF7KHZRUGPQHPRQLFVXJJHVWVWKDWLWPDNHVWKHPDFKLQHFRGHHDV\WRUHPHPEHUDOWKRXJKLW

GRHVQ WLWPDNHVWKHPDFKLQHFRGHXQQHFHVVDU\WRUHPHPEHU

 7KHRSHUDQGILHOGFRQWDLQVWKHREMHFWRUREMHFWVRQZKLFKWKHLQVWUXFWLRQLVRSHUDWLQJ,IWKHUHLVPRUH

WKDQRQHRSHUDQGWKH\DUHVHSDUDWHGE\FRPPDV$VZHQRWLFHGDERYH

$''

WDNHVWZRRSHUDQGV

-03

RQWKHRWKHUKDQGWDNHVRQH6RPHPQHPRQLFVWDNHQRQHDWDOO

 7KHFRPPHQWILHOGFRQWDLQVGRFXPHQWDWLRQ,WEHJLQVZLWKDVHPLFRORQ,QDQ\FRPSXWHUODQJXDJH

GRFXPHQWDWLRQLVLPSRUWDQW,QDVVHPEO\ODQJXDJHGRFXPHQWDWLRQLVHVSHFLDOO\LPSRUWDQWEHFDXVHDQ

DVVHPEO\ODQJXDJHSURJUDPLVHVSHFLDOO\KDUGWRUHDGZLWKRXWLW$OLQHPD\FRQVLVWRIQRWKLQJEXWD

FRPPHQW

3URJUDP

LVDQH[DPSOHRIDQ[DVVHPEO\ODQJXDJHSURJUDP7KHUHDGHUVKRXOGQRWHWKHFRQVLVWHQWIRXU

ILHOGOD\RXWHYHQWKRXJKVRPHRIWKHILHOGVRQVRPHRIWKHOLQHVDUHHPSW\0DQ\RIWKHLQVWUXFWLRQVLQ

3URJUDP

DUHPDNLQJWKHLUILUVWDSSHDUDQFHKHUHLQWKLVERRN7KHVHQHZLQVWUXFWLRQVDUHDOOGLVFXVVHGLQ

WKLVFKDSWHU

3URJUDP



*UHDWHVWFRPPRQGLYLVRUSURJUDP



029(';LVWKHRQO\(GOLQDVLQSXWSRUW

,1($;>';@*HWWKHXVHU VILUVWLQSXW

029(&;($;*HWWKHLQSXWRXWRIKDUP VZD\

,1($;>';@*HWWKHXVHU VVHFRQGLQSXW

029(';($;8VH(';IRUWKHODUJHURIWKHWZRLQSXWV

25'68%($;(&;8VH($;DVDZRUNLQJFRS\RI(';

-=*&':KHQHTXDOLW\LVREWDLQHGZHDUHGRQH

-161;7:HZDQW(';WREHODUJHU1RVZDSQHHGHG

029($;(&;6ZDS(';DQG(&;7DNHVWKUHH029 V

029(&;(';

1;7029(';($;,IWKHUHZDVQRVZDSWKHQ('; (';(&;

-0325'(QGRIWKHORRS

*&'029($;(';7KH*&'LVLQ(';

029(';:HQHHG(';IRUWKHRXWSXWSRUWQXPEHU

287>';@($;'LVSOD\WKHDQVZHUWRWKHXVHU

5(7

&RPSXWHUVIURPWKH&386WDQGSRLQW

&RPSXWHUVDUHRIWHQGHVFULEHGDVFRQVLVWLQJRIWKUHHSDUWVWKH&38WKHPHPRU\DQGWKHLQSXWRXWSXWRU

,2V\VWHP$GLDJUDPGUDZQDFFRUGLQJWRWKLVSLFWXUHORRNVOLNH

)LJXUH

,QFOXGHGLQWKH,2V\VWHPDUH

WKHPRQLWRUWKHNH\ERDUGWKHKDUGGULYHWKHSULQWHUWKHPRGHPWKHVRXQGFDUGDQGWKH&'5207KHVH

DUHDOOMXVW,2GHYLFHV7KLVLVDSURFHVVRUFHQWULFYLHZ-XVWDVPHPEHUVRIDJURXSVRPHWLPHVFDWHJRUL]H

SHRSOHLQWHUPVRIKRZWKH\UHODWHWRWKHJURXSWKLVSLFWXUHRIDFRPSXWHUGHILQHVSDUWVRIDFRPSXWHU

DFFRUGLQJWRKRZWKH\UHODWHWRWKH&386LQFHDVVHPEO\ODQJXDJHLVDOODERXWZRUNLQJZLWKWKH&38

KRZHYHULWLVDXVHIXOSRLQWRIYLHZIRUXVWRDGRSW

)LJXUH$OO&RPSXWHUVDUH'LYLGHGLQWR7KUHH3DUWV

,IZHLPDJLQHWKH&38LQWKHSLFWXUHWREHDWKHQZHFDQWKLQNRIWKHGDWDEXVDVDVHWRIZLUHV

FRQQHFWHGWRSLQVRQWKH&38DQGWKHDGGUHVVEXVDVDQRWKHUVHWRIZLUHVDOVRFRQQHFWHGWRWKH&38

1RWLFHWKDWWKHPHPRU\DQG,2V\VWHPVDUHFRQQHFWHGWRWKHSURFHVVRULQHVVHQWLDOO\WKHVDPHZD\,IZH

LPDJLQHYLHZLQJWKHELWVIORZLQJRQWKHEXVHVDGDWDWUDQVIHUEHWZHHQWKH&38DQGWKHPHPRU\ORRNV

DOPRVWH[DFWO\OLNHDGDWDWUDQVIHUEHWZHHQWKH&38DQGWKH,2V\VWHP7KHGLIIHUHQFHDFWXDOO\ERLOVGRZQ

WRDVLQJOHSLQRQWKH&387KLVSLQLVFDOOHGWKH0,2SLQ:KHQWKLVSLQLVDWORJLFLWVLJQDOVDPHPRU\

WUDQVIHU:KHQLWLVDWORJLFLWVLJQDOVDQ,2WUDQVIHU7KHDERYHGLDJUDPGRHVQRWUHDOO\PDNHVHQVH

ZLWKRXWDQ0,2ZLUH,WDOVRQHHGVD:5ZLUHWRVLJQDOZKHWKHUGDWDLVWRIORZLQWRRURXWRIWKH

SURFHVVRU7KHVHZLUHVDUHFDOOHGFRQWUROZLUHVDQGDUHSDUWRIWKHFRQWUROEXV

7KHUHDGHULVXUJHGWRFRPSDUH

)LJXUH

ZLWK

)LJXUH

ZKLFKVKRZVLQJUHDWHUGHWDLOKRZWKHZLUHV

IURPWKHWKUHHGLIIHUHQWEXVHVKRRNXSWRDPHPRU\FLUFXLW

0HPRU\YV,2

,Q

7DEOH

ZHVHHWZRLPPIRUPVRIWKH

029

FRPPDQGFRPSDUHGZLWKWKHFRUUHVSRQGLQJ,2FRPPDQGV

7KHVHFRPPDQGVFDUU\RXWWUDQVIHUVEHWZHHQWKH$/UHJLVWHUDQGWKHPHPRU\RU,2GHYLFHORFDWHGDW

DGGUHVV7KHSURFHVVRU

VLJQDOVUHDGYVZULWHXVLQJWKH:5SLQDQGPHPRU\YV,2XVLQJWKH0,2SLQ2WKHUZLVHWKH

WUDQVDFWLRQLVYHU\VLPLODU

2QHVLJQLILFDQWGLIIHUHQFHEHWZHHQPHPRU\DQG,2DGGUHVVLQJRQWKH[LVWKDWPHPRU\DGGUHVVHV

XQGHUJRSURFHVVLQJEHIRUHWKH\OHDYHWKHSURFHVVRU7KLVSURFHVVLQJKDVWZRVWDJHVVHJPHQWDWLRQDQG

SDJLQJ6HJPHQWDWLRQLVGHVFULEHGLQ

FKDSWHU

DQGSDJLQJLVGHVFULEHGLQ

FKDSWHU



$QRWKHUGLIIHUHQFHEHWZHHQWKH,2V\VWHPDQGWKHPHPRU\LVWKDWWKH\GRQRWKDYHWKHVDPHUDQJHRIYDOLG

DGGUHVVHV$VGLVFXVVHGLQ

FKDSWHU

WKHUDQJHRIYDOLGPHPRU\DGGUHVVHVYDULHVIURPRQH[SURFHVVRUWR

DQRWKHU,WGHSHQGVRQWKHQXPEHURIDGGUHVVSLQVWKHSURFHVVRUKDV7KHUDQJHRIYDOLG,2DGGUHVVHVRQ

WKHRWKHUKDQGLVWKHVDPHRQDOO[SURFHVVRUV,WLVWKHELWUDQJHIURPWR,QFLGHQWDOO\WKLV

PHDQVWKDWWKH,2V\VWHPGRHVQRWQHHGWREHFRQQHFWHGWRDOODGGUHVVZLUHVRQO\WRWKHERWWRP7KH

DGGUHVVHVLQWKLVUDQJHDUHFDOOHGSRUWVRUSRUWQXPEHUV

0DQ\H[LVWLQJ,2GHYLFHVVXFKDVGLVNGULYHVSULQWHUVDQGVHULDOSRUWVXVHDKDQGIXORISRUWVHDFK

7DEOH



IRUH[DPSOHOLVWVWKHHLJKWDGGUHVVHVXVHGE\WKHVWDQGDUGVHULDOSRUWV&OHDUO\WKHSRUWQXPEHUV

WKURXJKLQWKHWDEOHDUHQRWSRUWQXPEHUVLQWKHVSHFLILFVHQVHZHDUHFRQVLGHULQJKHUH%XWWKHIROORZLQJ

KH[DGGUHVVHVDUHSHUIHFWH[DPSOHVRIWKHVHSRUWQXPEHUV$UHODWLYHO\FRPSOHWH

OLVWRIWKHSRUWQXPEHUVXVHGRQDVWDQGDUG3&PD\EHIRXQGLQ$SSHQGL[$RI6KDQOH\ V,6$6\VWHP

$UFKLWHFWXUH7KH,2SRUWVLQXVHRQD/LQX[PDFKLQHPD\EHDFFHVVHGYLDWKH

SURF

GLUHFWRU\XVLQJWKH

FRPPDQG

OLQX[ER[FDWSURFLRSRUWV

7DEOH([DPSOHVRI0HPRU\DQG,27UDQVIHU&RPPDQGV

0HPRU\

,2

5HDG

029$/>@

,1$/>@

:ULWH

029>@$/

287>@$/

7DEOH6WDQGDUG6HULDO3RUW,2$GGUHVVHV

&RP3RUW

,2$GGUHVVHV



)+))+



)+))+



(+()+



)+))+

7KHFORVHVLPLODULW\RIPHPRU\DQG,2WUDQVIHUVLVQRWIXOO\UHIOHFWHGLQ[DVVHPEO\ODQJXDJHZKLFKKDV

PDQ\FRPPDQGVLQYROYLQJPHPRU\DFFHVVEXWRQO\DIHZ

,1

DQG

287

IRUH[DPSOHFRQWUROOLQJ,2DFFHVV

7KHXVHRI

029

DQGPDQ\RWKHUFRPPDQGVWRDFFHVVPHPRU\LVGLVFXVVHGLQ

FKDSWHU



VHFWLRQ

7KH

,1

DQG

287

FRPPDQGVDUHGLVFXVVHGQH[W

7KH

,1

&RPPDQG

7KHLQSXWFRPPDQGWUDQVIHUVGDWDIURPDQ,2SRUWLQWRWKHSURFHVVRU7KHUHDUHVL[YDOLGIRUPVRIWKLV

FRPPDQG

,1($;>';@

,1$;>';@

,1$/>';@

,1($;>LPP@

,1$;>LPP@

,1$/>LPP@

ZKHUHLPPLVDQ\RQHE\WHQXPEHU1RWLFHWKDWWKHJHQHUDO

&200$1'GHVWLQDWLRQVRXUFH

IRUPDWLVDGKHUHGWRLQWKLVLQVWUXFWLRQ7KHYDOLGGHVWLQDWLRQUHJLVWHUVDUH($;$;DQG$/7KH,2

GHYLFHZKRVHSRUWQXPEHULVVWRUHGLQ';RUJLYHQE\LPPLVWKHVRXUFH

1RWLFHWKDW';LVDELWUHJLVWHU7KLVPDNHVVHQVHEHFDXVHDSRUWQXPEHULVDELWQXPEHU0RVW,QWHO

DVVHPEOHUVLQFOXGLQJ1$60GRQRWXVHEUDFNHWVDURXQGWKHSRUWQXPEHU,I\RXGRKRZHYHU\RXFDQ

WKLQNRIWKHFRPPDQG

,1$/>';@

IRUH[DPSOHDV

OHW$/ >';@

ZKHUHWKH>';@UHIHUVWRGDWDORFDWHGDWWKHDGGUHVV';7KLVLVGRQHLQ(GOLQDVIRUWKHVDNHRIFRQVLVWHQF\

0HPRU\FRPPDQGVXVHEUDFNHWVLQWKHVDPHZD\%UDFNHWVEHFRPHDGHUHIHUHQFLQJRSHUDWRUOLNH LQWKH&

ODQJXDJH,QERWK(GOLQDVDQG1$60DOOUHIHUHQFHVWRGDWDLQPHPRU\E\PHDQVRIDQDGGUHVVXVHEUDFNHWV

DURXQGWKHDGGUHVV1$60GRHVQRWXVHEUDFNHWVIRU,2UHIHUHQFHV+HQFHLQXVLQJ1$60WKHEUDFNHWVLQ

WKH

,1

DQG

287

LQVWUXFWLRQVDUHRPLWWHG

%HFDXVHWKHLPPIRUPVRIWKH

,1

FRPPDQGDFFHSWRQO\RQHE\WHSRUWVRQO\WKHERWWRPRIWKH

SRUWVDUHDFFHVVLEOHXVLQJWKHLPPIRUPV1RWLFHWKDWWKH

,1

FRPPDQGZDVQRWJLYHQDV

,1

UHJ>UHJ@7KLVLV

EHFDXVHIRUPVVXFKDV

,1(%;>';@

DQG

,1($;>&;@

DUHQRWYDOLG

7KH

287

&RPPDQG

7KHRXWSXWFRPPDQGWUDQVIHUVGDWDIURPWKHSURFHVVRUWRDQ,2GHYLFH7KHVL[YDOLGIRUPVRIWKLV

FRPPDQGDUH

287>';@($;

287>';@$;

287>';@$/

287>LPP@($;

287>LPP@$;

287>LPP@$/

ZKHUHDJDLQLPPLVDQ\RQHE\WHQXPEHU7KHRUGHURIWKHRSHUDQGVLVRSSRVLWHWRZKDWLWLVLQWKH

,1

FRPPDQGEHFDXVHWKHGDWDLVIORZLQJLQWKHRSSRVLWHGLUHFWLRQ7KHVRXUFHLVHLWKHUWKH($;WKH$;RUWKH

$/UHJLVWHUDQGWKHGHVWLQDWLRQLVDQ,2GHYLFH$JDLQ1$60GRHVQ WXVHEUDFNHWVZLWK

287

0HPRU\0DSSHG,2

:KHQDGGUHVVHVLQWKHPHPRU\DGGUHVVVSDFHDUHFRQQHFWHGLQIDFWWR,2GHYLFHVWKLVLVUHIHUUHGWRDV

PHPRU\PDSSHG,27KHYLGHREXIIHURQWKHVWDQGDUG3&LVDQH[DPSOH&KDUDFWHUVVWRUHGDWWKHE\WHV

VWDUWLQJDWWKHPHPRU\DGGUHVV%+DUHRXWSXWWRWKHPRQLWRU

8VLQJDVHSDUDWHDGGUHVVVSDFHIRU,2GHYLFHVLVQRWWKHRQO\FRQFHLYDEOHDSSURDFKWR,2DGGUHVVLQJ0DQ\

DUFKLWHFWXUHVXVHDVLQJOHVHWRIDGGUHVVHVDQGVLPSO\UHVHUYHVRPHRIWKHPIRU,2

5HVHUYHGDGGUHVVHVDUHDOVRXVHGRQ3&VIRU520RUUHDGRQO\PHPRU\,IPHPRU\ZULWHVDUHGRQHWRUHDG

RQO\PHPRU\WKHSURFHVVRUZLOOVHQGWKHDSSURSULDWHZULWHVLJQDOVRXWRQWRWKHEXVHVEXWQRFKDQJHZLOOEH

PDGHLQWKHVWRUHGGDWD

6LPSOH$VVHPEO\/DQJXDJH3URJUDPV

6LPSOHKLJKOHYHOODQJXDJHSURJUDPVRIWHQKDYHDWKUHHSDUWIRUPDWLQSXWGDWDGRFDOFXODWLRQVDQGWKHQ

RXWSXWWKHUHVXOWV8VLQJ(GOLQDVVLPSOHSURJUDPVRIWKHVDPHVW\OHFDQEHZULWWHQLQ[DVVHPEO\

ODQJXDJH

(GOLQDV3RUWV

7KHLPDJLQDU\PDFKLQHVLPXODWHGE\(GOLQDVXVHVRQO\WZRSRUWQXPEHUV

z

LVWKHSRUWIRUWKHNH\ERDUGLQSXW

z

LVWKHSRUWIRUWKHVFUHHQRXWSXW

.H\ERDUGLQSXWLVHFKRHGDWWKHORZHUOHIWRIWKHVFUHHQDQGRXWSXWLVGLVSOD\HGDWWKHORZHUULJKW:KHQ

,1

($;>';@

LVXVHGZLWK(GOLQDVWKHYDOXHVWRUHGLQ';VKRXOGEH:KHQSRUWLVDGGUHVVHGWKHXVHULV

SURPSWHGIRUDQLQSXWYDOXH:KHQ

287>';@($;

LVXVHGWKHYDOXHVWRUHGLQ';VKRXOGEH:KHQSRUW

LVXVHGWKHRXWSXWYDOXHLVGLVSOD\HGLQEDVHWHQDWWKHERWWRPULJKWRIWKHVFUHHQ7KHXVHRIWKHVHWZRSRUWV

DOORZVYHU\VLPSOHSURJUDPVWREHZULWWHQLQJHQXLQH[DVVHPEO\ODQJXDJHDQGUXQRQWKH(GOLQDV

VLPXODWRU

3URJUDPVXVLQJ(GOLQDVSRUWVZLOOQRWUXQXQGHU'26RU8QL[,Q

FKDSWHU



VHFWLRQ

LWLVVKRZQKRZ

WKHVH,2FRPPDQGVWRWKHVLPXODWHGPDFKLQHPD\EHUHSODFHGE\FDOOVWRWKH&OLEUDU\IXQFWLRQV

VFDQI

DQG

SULQWI

,QWKLVZD\VLPSOH(GOLQDVSURJUDPVXVLQJUHDO,2FDQEHUXQXQGHU/LQX[

7KH

5(7

&RPPDQG

3URJUDPVDUHVHWLQPRWLRQE\WKHRSHUDWLQJV\VWHP:KHQWKHSURJUDPLVILQLVKHGLWPXVWUHWXUQFRQWUROWR

WKHRSHUDWLQJV\VWHP

5(7

GRHVWKLV6XESURJUDPVDOVRXVH

5(7

WRUHWXUQFRQWUROWRDFDOOLQJSURJUDP

5(7

ZRUNVXVLQJWKHVWDFNDQGLVGLVFXVVHGLQ

FKDSWHU



VHFWLRQ



3URJUDPWR$GG7ZR1XPEHUV

:HQRZKDYHDOOWKHFRPPDQGVZHQHHGWRZULWHVRPHVLPSOHEXWFRPSOHWHSURJUDPV+HUHLVDQ(GOLQDV

SURJUDPWRDGGWZRQXPEHUV

3URJUDP

029(';0DNLQJDOOELWV]HURPDNHV';]HUR

,1($;>';@8VHUHQWHUVWKHILUVWQXPEHUYLDSRUW]HUR

029(%;($;*HWWKHILUVWQXPEHURXWRIWKHZD\

,1($;>';@8VHUHQWHUVWKHVHFRQGQXPEHU

$''($;(%;$GGWKHILUVWQXPEHUWRWKHVHFRQG

029(';7KH(GOLQDVRXWSXWSRUWLVRQH

287>';@($;7KHUHVXOWLVRXWSXWWRWKHXVHU

5(7(QGWKHVLPXODWLRQ

$VVHPEOHU3URJUDPVZLWK-XPSV

+LJKOHYHOODQJXDJHVQHHGORRSVLQRUGHUWREHDEOHWRGRWKHLUZRUN7KHVHORRSVPXVWEHWXUQHGLQWR

DVVHPEO\FRGHE\DFRPSLOHU)RUH[DPSOHDVLOOXVWUDWHGLQ

)LJXUH

WRGRD&ODQJXDJH

ZKLOH

ORRSLQWKH

PRVWVWUDLJKWIRUZDUGZD\UHTXLUHVERWKDFRQGLWLRQDOMXPSIRUZDUGDQGDQXQFRQGLWLRQDOMXPSEDFNZDUG

)LJXUH

ZKLOH

WHVW%RG\

7KH

-03

&RPPDQG

7KHIHWFKH[HFXWHF\FOHZRUNVE\FDOFXODWLQJWKHDGGUHVVLQPHPRU\RIWKHQH[WLQVWUXFWLRQ7KLVDGGUHVVLV

QRUPDOO\GHWHUPLQHGE\MXVWJRLQJWRWKHILUVWDGGUHVV

EH\RQGWKHFXUUHQWLQVWUXFWLRQ,QRUGHUWRVXSSRUWLIWKHQVWDWHPHQWVRUORRSVLQKLJKOHYHOODQJXDJHV

KRZHYHUMXPSVDUHQHHGHG7KH

-03

FRPPDQGWUDQVIHUVH[HFXWLRQWRWKHDGGUHVVVSHFLILHGE\DODEHO

7KH

-03

FRPPDQGKDVWKHIRUP

-03ODEHO

7KHODEHOLVFUHDWHGE\WKHSURJUDPPHU,WLVZLVHWRGHYLVHODEHOVZKLFKKHOSLQXQGHUVWDQGLQJWKHSURJUDP

)RUWKLVSXUSRVHORQJODEHOVDUHXVHIXO2QWKHRWKHUKDQGWKHVFUHHQVSDFHXVHGE\(GOLQDVLVYHU\OLPLWHG

DQGVRODEHOVEH\RQGWKUHHFKDUDFWHUVDUHWUXQFDWHGZKHQWKH\DUHGLVSOD\HGXQOHVVWKH\DUHRQDOLQHE\

WKHPVHOYHV7KHODEHOLQWKHODEHOILHOGVSHFLILHVWKHWDUJHWRIWKHMXPSDQGRIWHQKDVDFRORQDSSHQGHGWR

PDNHLWFOHDUWKDWLWLVDODEHODQGQRWDQDUFDQHPQHPRQLF0DQ\MXPSFRPPDQGVPD\SRLQWWRWKHVDPH

WDUJHWEXWQRWZROLQHVPD\FDUU\WKHVDPHODEHOLQWKHLUODEHOILHOG,QWKHIROORZLQJSURJUDPWKHODVWOLQH

WUDQVIHUVFRQWUROWRWKHSUHFHGLQJOLQH7KLVSURJUDPFRQWLQXHVDGGLQJWRWKH($;UHJLVWHUIRUHYHU,WLVDQ

LQILQLWHORRS,QILQLWHORRSVDUHXVXDOO\ZULWWHQRQO\E\PLVWDNH

&RQGLWLRQDO-XPSVDQG)ODJV

$FRQGLWLRQDOMXPSLVDMXPSFDUULHGRXWRQWKHEDVLVRIDWUXWKYDOXH7KHLQIRUPDWLRQRQZKLFKVXFK

GHFLVLRQVDUHEDVHGLVFRQWDLQHGLQRQHELWUHJLVWHUVFDOOHGIODJV:KHQDIODJFRQWDLQVLWLVUHIHUUHGWRDV

EHLQJVHW:KHQLWFRQWDLQVLWLVUHIHUUHGWRDVEHLQJFOHDUHG7ZRYHU\LPSRUWDQWIODJVDUHWKH]HURIODJ

DQGWKHVLJQIODJ

3URJUDP

029($;

029(%;

;<=$''($;(%;

-03;<=

7KH=HURDQG6LJQ)ODJV

7KH

$''

DQG

68%

FRPPDQGVDIIHFWQRWRQO\WKHLUGHVWLQDWLRQUHJLVWHUVEXWDOVRPDQ\RIWKHIODJV6XSSRVH

WKHFRPPDQG

$''($;(%;

LVH[HFXWHG7KHUHVXOWRIWKLVFRPPDQGZLOOEHLQWKH($;UHJLVWHU,IWKLVUHVXOWLVWKHQWKH]HURIODJLV

VHW,ILWLVQRWWKHQWKH]HURIODJLVFOHDUHG

7KHYDOXHJLYHQWRWKHVLJQIODJDIWHUDQ

$''

LQVWUXFWLRQLVWKHYDOXHRIWKHPRVWVLJQLILFDQWELWRIWKHUHVXOW

7KLVELWLVLIWKHUHVXOWLVQHJDWLYHZKHQYLHZHGDVDVLJQHGQXPEHU7KXVLIH[HFXWLQJWKH

$''($;(%;

FRPPDQGJLYHV($;DYDOXHZKLFKLVQHJDWLYHDVDIRXUE\WHVLJQHGQXPEHUWKHQWKHVLJQIODJLVVHW

RWKHUZLVHWKHVLJQIODJLVFOHDUHG

7KH

-=-6-1=

DQG

-16

&RPPDQGV

7KHIROORZLQJFRQGLWLRQDOMXPSFRPPDQGVDOOKDYHWKHVDPHIRUPDWDVWKH

-03

FRPPDQG

-=ODEHO

-6ODEHO

-1=ODEHO

-16ODEHO

7KH\HDFKWDNHDODEHOLQWKHRSHUDQGILHOG7KHPHDQLQJVRIWKHVHFRPPDQGVDUHDVIROORZV

-=-XPSLIWKH]HURIODJLVVHW

-6-XPSLIWKHVLJQIODJLVVHW

-1=-XPSLIWKH]HURIODJLVQRWVHW

-16-XPSLIWKHVLJQIODJLVQRWVHW

7KHIROORZLQJDVVHPEO\ODQJXDJHSURJUDPLOOXVWUDWHVWKHXVHRIWKH

-6

LQVWUXFWLRQLQDSURJUDPWRGHWHUPLQH

ZKLFKRIWZRXVHULQSXWVLVODUJHU

3URJUDP

VHHPVDLUWLJKW,QIDFWLWKDVDEXJ

3URJUDP

,IWKHILUVWLQSXWLVODUJHURXWSXW

,IWKHVHFRQGLQSXWLVODUJHURXWSXW

7KHSURJUDPXVHVVXEWUDFWLRQ

%$LVWUXHLIDQGRQO\LI%²$LVQHJDWLYH

$VXEWUDFWLRQIROORZHGE\D-6GRHVWKHMRE



029(';

,1($;>';@

029(%;($;7KHILUVWLQSXWLVQRZLQ(%;

,1($;>';@7KHVHFRQGLQSXWLVQRZLQ($;

68%(%;($;7KLVLVILUVW±VHFRQG

-66,%6HFRQGLV%LJJHU

029($;2WKHUZLVH)LUVWLV%LJJHU

-03(1''RQ WGULIWLQWRWKHRWKHUFDVH

6,%029($;

(1'029(';(LWKHUZD\QRZ($;LVUHDG\

287>';@($;

5(7

$VVHPEOHU3URJUDPVZLWK/RRSV

&RQGLWLRQDOMXPSVDUHXVHGWRLPSOHPHQWORRSVDQGLIWKHQVWDWHPHQWV6XSSRVHZHFRQVLGHUWKHIROORZLQJ

SURJUDPZKLFKGRHVPXOWLSOLFDWLRQXVLQJUHSHDWHGDGGLWLRQ)RUH[DPSOHWRGRîZHFDQGR

,Q

3URJUDP

WKHQXPEHULVDGGHGLQRQHOLQHDQGVXEWUDFWHGLQDQRWKHU7KHUHDUHVSHFLDO

FRPPDQGVIRUWKLVZKLFKWDNHOHVVPHPRU\VSDFH

3URJUDP



029(';

,1($;>';@)LUVWLQSXWLVWKHPXOWLSOLHU

029(%;($;3XW0XOWLSOLHULQ(%;

,1($;>';@6HFRQGLQSXWLVWKHPXOWLSOLHGQXPEHU

029(&;,QLWLDOL]HWKHUXQQLQJWRWDO

537$''(&;($;'RRQHDGGLWLRQ

68%(%;2QHOHVV\HWWREHGRQH

-1=537,IWKDW VQRW]HURGRDQRWKHU

029($;(&;3XWWKHWRWDOLQ($;

$''(';

287>';@($;2XWSXWWKHDQVZHU

5(7

7KH

,1&

DQG

'(&

&RPPDQGV

7KHIROORZLQJLQFUHPHQWDQGGHFUHPHQWFRPPDQGVDGGDQGVXEWUDFW

,1&UHJ

DQG

'(&UHJ

UHJPD\EHDQ\RIWKHJHQHUDOUHJLVWHUV7KHVHFRPPDQGVDUHRIWHQXVHGWRLQFUHPHQWRUGHFUHPHQWD

ORRSFRXQWHU,Q

3URJUDP



68%(%;

FDQEHUHSODFHGE\

'(&(%;

DQG

$''(';

FDQEHUHSODFHGE\

,1&(';

6LJQHG&RPSDULVRQV

&RPSDULVRQ%DVHG-XPSV

+LJKOHYHOODQJXDJHVRIWHQXVHFRPSDULVRQVLQLIWKHQVWDWHPHQWV8VLQJWKHVLJQIODJWRWHVWWKHUHVXOWRID

VXEWUDFWLRQDVZDVGRQHLQ

VHFWLRQ

VHHPVWREHDUHDVRQDEOHZD\WRLPSOHPHQWWKLVWHVWLQJVLQFHLWLVD

PDWKHPDWLFDOIDFWWKDW

%$LIDQGRQO\LI%$LVQHJDWLYH

6LQFHWKHVLJQIODJLQGLFDWHVWKHVLJQRIWKHUHVXOWRIDVXEWUDFWLRQZHZRXOGVHHPWREHRQVROLGJURXQG%XW

LQIDFWWKLVLVQRWWUXH

7KH2YHUIORZ)ODJ

6XSSRVHZHDUHXVLQJRQHE\WHVLJQHGQXPEHUVDQGZHZLVKWRWHVWZKHWKHU

,QRQHE\WHUHJLVWHUV

$QRYHUIORZKDVRFFXUUHG7KHUHVXOWLVQHJDWLYH7KHVLJQIODJLVVHWDQGWKHFRPSDULVRQZLOOEHMXGJHGDV

WUXH8VLQJWKHVLJQIODJWRGHWHUPLQHDMXPSJLYHVWKHZURQJDQVZHU%XWVLQFHDQRYHUIORZDOZD\VFKDQJHV

WKHVLJQRIDUHVXOWWRWKHRSSRVLWHRIZKDWLWVKRXOGEHWKHMXPSFRQGLWLRQFDQEHIL[HG

 ,IQRRYHUIORZKDVRFFXUUHGMXPSLIWKHVLJQIODJLVVHW

 ,IDQRYHUIORZKDVRFFXUUHGMXPSLIWKHVLJQIODJLVQRWVHW

7KH[SURFHVVRUKDVDQRYHUIORZIODJ,WLVXVHGLQRUGHUWRLPSOHPHQWWKLVIL[HGXSMXPSFRQGLWLRQ,IZH

XVH6)IRUWKHELQDU\YDOXHRIWKHVLJQIODJDQG2)IRUWKDWRIWKHRYHUIORZIODJZHFDQUHVWDWHWKHIL[HG

MXPSFRQGLWLRQDVMXVW

-XPSLI6);252)

7KLVMXPSFRQGLWLRQZLOOSURGXFHDMXPSIROORZLQJDVXEWUDFWLRQVXFKDV

68%$/%/

LIDQGRQO\LI$/%/7KHUHLVDQ[FRPPDQGIRUWKLVMXPS7KHPQHPRQLFIRULWLV

-/

ZKLFKVWDQGV

IRUMXPSLIOHVVWKDQ

7KH

&03

&RPPDQG

:KHQDVXEWUDFWLRQLVSHUIRUPHGRQO\IRUWKHVDNHRIDFRPSDULVRQLWPD\EHGRQHZLWKWKH

&03

LQVWUXFWLRQ

7KLVFRPPDQGVHWVWKHIODJVLQWKHH[DFWVDPHZD\DV

68%

EXWKDVWKHDGYDQWDJHRIQRWZDVWLQJUHJLVWHU

VSDFHE\VWRULQJDQXQQHHGHGUHVXOW8VLQJWKH

-/

DQG

&03

LQVWUXFWLRQVZHFDQUHZULWHWKH

3URJUDP

DV

IROORZV

3URJUDP

,IWKHILUVWLQSXWLVODUJHURXWSXW

,IWKHVHFRQGLQSXWLVODUJHURXWSXW

7KHSURJUDPXVHVVXEWUDFWLRQ

%$LVWUXHLIDQGRQO\LI%$LVQHJDWLYH

029(';

,1($;>';@

029(%;($;7KHILUVWLQSXWLVQRZLQ(%;

,1($;>';@7KHVHFRQGLQSXWLVQRZLQ($;

&03(%;($;7KLVLVILUVW±VHFRQG

-/6,%6HFRQGLV%LJJHU

029($;2WKHUZLVH)LUVWLV%LJJHU

-03(1''RQ WGULIWLQWRWKHRWKHUFDVH

6,%029($;

(1'029(';(LWKHUZD\QRZ($;LVUHDG\

287>';@($;

5(7

3URJUDP

ZRUNVFRUUHFWO\IRUDOOQXPEHUVLQWKHXQVLJQHGIRXUE\WHUDQJH

0RUH-XPS&RPPDQGV

)ROORZLQJD

&03($;(%;

FRPPDQGWKH

-/

FRPPDQGH[HFXWHVDMXPSLIWKHFRQGLWLRQ($;(%;LV

WUXH7KHFRPPDQGV

&03($;(%;

-/$%&

PHDQ

&RPSDUH($;WR(%;DQG

-XPSLI($;LVOHVVWKDQ(%;

:KDWLVJRLQJRQKHUHLVVXEWUDFWLRQDQGIODJFKHFNLQJEXWWKHZHOOGHVLJQHGV\QWD[DOORZVXVWRRYHUORRN

WKDW7KHOHVVWKDQFRQGLWLRQLVQRWWKHRQO\FRQGLWLRQFRQYHQLHQWO\DFFHVVHGIROORZLQJD

&03

FRPPDQG$

OLVWRIVHYHUDORWKHUFRQGLWLRQDO

MXPSFRPPDQGVLVJLYHQKHUH

-/OHVVWKDQ($;(%;

-/(OHVVWKDQRUHTXDO($; (%;

-*JUHDWHUWKDQ($;!(%;

-*(JUHDWHUWKDQRUHTXDO($; (%;

-(HTXDO($; (%;

-1/QRWOHVVWKDQ($;"(%;

-1/(QRWOHVVWKDQRUHTXDO($;"(%;

-1*QRWJUHDWHUWKDQ($;"(%;

-1*(QRWJUHDWHUWKDQRUHTXDO($;"(%;

-1(QRWHTXDO($;"(%;

%HFDXVHWKHVHYDULRXVMXPSFRPPDQGVDUHVRHDVLO\LQWHUSUHWHGWKH\WXUQWKHFRPSDUHFRPPDQGLQWRDNLQG

RIV\QWDFWLFDOZLQGIDOO

8QVLJQHG&RPSDULVRQV

,Q

VHFWLRQ

LWZDVVKRZQKRZIODJVFRXOGEHXVHGWRGHWHUPLQHWKHWUXWKYDOXHVRILQHTXDOLWLHVVRWKDW

WKHVHLQHTXDOLWLHVFRXOGEHXVHGLQFRQGLWLRQDOMXPSV7KHFRQGLWLRQVREWDLQHGZRUNIRUXQVLJQHGQXPEHUV

%XWVXSSRVHZHFRQVLGHUWKHVDPHH[DPSOH

WKDWZHFRQVLGHUHGLQWKHODVWVHFWLRQDQGQRWHWKDWZKHQWKLVVDPHLQHTXDOLW\LVVWDWHGLQWHUPVRIXQVLJQHG

QXPEHUVLWEHFRPHV

7KLVLQHTXDOLW\KDVWKHRSSRVLWHWUXWKYDOXH6RDMXPSLIOHVVWKDQFRPPDQGIRUXQVLJQHGQXPEHUVPXVW

H[HFXWHDMXPSLQWKLVFDVH7KH

-/

FRPPDQGZLOOQRWGRVR7KHVLJQHGMXPSFRPPDQGVRIWKHSUHYLRXV

VHFWLRQGRQRWZRUNIRUXQVLJQHGQXPEHUV,I$/ + DQG%/ &(+ WKHQD

-/

ZLOOQRW

H[HFXWHDMXPSEHFDXVHLWLVDFWLQJRQ$QXQVLJQHGMXPSLIOHVVWKDQLVQHHGHG

7KH&DUU\)ODJ

,QWKHFDVHRIXQVLJQHGQXPEHUVWKHLQHTXDOLW\$%WXUQVRXWWREHHDVLHUWRWHVWWKDQLWVVLJQHG

FRXQWHUSDUW6LQFHDVXEWUDFWLRQRIXQVLJQHGQXPEHUV$%FDQQRWJRRXWRIUDQJHRQWKHKLJKVLGHLWLVRXW

RIUDQJHLIDQGRQO\LILWLVQHJDWLYH2XWRIUDQJHHUURUVIRUXQVLJQHGQXPEHUVDUHFDOOHGFDUU\HUURUV+HQFH

$%LVWUXHLIDQGRQO\LIWKHVXEWUDFWLRQ$%SURGXFHVDFDUU\HUURU6RDIODJZKLFKVLJQDOVFDUU\HUURUV

ZLOOVLJQDOQHJDWLYHUHVXOWVRIDVXEWUDFWLRQ7KH[SURFHVVRUVKDYHDFDUU\IODJWRLQGLFDWHWKHVHHUURUV

8VLQJ&)WRGHQRWHWKHYDOXHRIWKLVFDUU\IODJZHFDQHDVLO\VWDWHWKHFRQGLWLRQXVHGWRLPSOHPHQWWKH

XQVLJQHGMXPSLIOHVVWKDQFRPPDQGDVMXPSLI&)

/LNHWKHVLJQIODJWKH]HURIODJDQGWKHRYHUIORZIODJWKHFDUU\IODJUHVSRQGVWRFRQGLWLRQVRFFXUULQJ

ZKHQHYHU

$''

RU

68%

DUHXVHG8QOLNHWKHVHRWKHUWKUHHIODJVLWLVXQDIIHFWHGE\WKH

,1&

DQG

'(&

FRPPDQGV

2XWRI5DQJH)ODJ6XPPDU\

$ULWKPHWLFFRPPDQGVVXFKDV

$''

DQG

68%

DUHSHUIRUPHGRQELQDU\ELWVZLWKRXWDQ\LQIRUPDWLRQVSHFLI\LQJ

ZKHWKHUWKHELWVDUHEHLQJXVHGWRUHSUHVHQWVLJQHGRUXQVLJQHGQXPEHUV,WLVWKHUHVSRQVLELOLW\RIWKH

VRIWZDUHWRNHHSWUDFNRIWKLV

:KHQWKHVRIWZDUHXVHVWKHSURFHVVRUWRGRDULWKPHWLFRQVLJQHGQXPEHUVWKHQLWVKRXOGFRQVXOWWKH

RYHUIORZIODJWRGHWHUPLQHZKHWKHURUQRWDQRXWRIUDQJHHUURUKDVRFFXUUHG:KHQWKHVRIWZDUHXVHVWKH

SURFHVVRUWRZRUNRQXQVLJQHGQXPEHUVWKHQWKHVRIWZDUHVKRXOGFRQVXOWWKHFDUU\IODJWRFKHFNIRUDQRXW

RIUDQJHHUURU

7KHKDUGZDUHKDVQRZD\RINQRZLQJZKHWKHUWKHQXPEHUVDUHVLJQHGRUXQVLJQHG$QGLWGRHVQ WPDWWHU

)RUH[DPSOHRQRQHE\WHUHJLVWHUVWKHFRPPDQGWRDGG))+WR))+PD\EHFRPLQJIURPVRIWZDUHWKDWLV

ZRUNLQJZLWKVLJQHGQXPEHUV,QWKLVFDVHWKHVXP)(+LVQRWDSUREOHP7KHVRIWZDUHVHHVWKHDULWKPHWLF

WKDWKDVMXVWKDSSHQHGDV

7KLVLVRND\

2QWKHRWKHUKDQGWKHFRPPDQGPD\EHFRPLQJIURPVRIWZDUHWKDWLVXVLQJXQVLJQHGQXPEHUV,QWKLVFDVH

WKHVRIWZDUHVHHVWKHDULWKPHWLFWKDWKDVMXVWKDSSHQHGDV

7KLVLVQRWRND\7KHWUXHDQVZHUKDVJRQHRXWRIWKHRQHE\WHXQVLJQHGUDQJH+HQFHWKH

DGGLWLRQRI))+WR))+FOHDUVWKHRYHUIORZIODJEHFDXVHWKHVLJQHGDULWKPHWLFDQVZHULVRND\DQGVHWVWKH

FDUU\IODJWRQRWLI\VRIWZDUHWKDWWKHUHLVDQXQVLJQHGRXWRIUDQJHHUURU

$VDQRWKHUH[DPSOHVXSSRVHWKDWRQHE\WHUHJLVWHUVUHFHLYHDFRPPDQGWRDGG+WR+7KHVXPLV

+,IWKHFRPPDQGKDVFRPHIURPVRIWZDUHZRUNLQJZLWKXQVLJQHGQXPEHUVWKHQWKHDULWKPHWLFMXVWGRQH

ZLOODSSHDUDV

7KLVLVRND\

6XSSRVHWKDWWKHFRPPDQGKDVFRPHIURPVRIWZDUHZRUNLQJZLWKVLJQHGQXPEHUV7KHQWKHDULWKPHWLF

ORRNVOLNHWKLV

7KLVLVQRWRND\7KHWUXHDQVZHULVRXWVLGHWKHRQHE\WHVLJQHGUDQJHWR7KHKDUGZDUH

VHWVWKHRYHUIORZIODJEHFDXVHWKLVLVDQRXWRIUDQJHHUURULQWKHVLJQHGQXPEHUV\VWHPDQGFOHDUVWKHFDUU\

IODJEHFDXVHWKHUHLVQRRXWRIUDQJHHUURULQWKHXQVLJQHGV\VWHP7KHKDUGZDUHGRHVQRWNQRZZKLFK

V\VWHPWKHVRIWZDUHLVXVLQJVRLWKDVWRWDNHFDUHRIERWKIODJV

%RWKWKHFDUU\DQGWKHRYHUIORZIODJVDUHRXWRIUDQJHLQGLFDWRUIODJV7KHFDUU\IODJLVVHWLIWKHDULWKPHWLF

LQWHUSUHWHGLQWKHXQVLJQHGV\VWHPKDVSURGXFHGDQRXWRIUDQJHHUURU7KHRYHUIORZIODJLVVHWLIWKH

DULWKPHWLFLQWHUSUHWHGLQWKHVLJQHGV\VWHPKDVSURGXFHGDQRXWRIUDQJHHUURU

6WLOO0RUH-XPS&RPPDQGV

*LYHQWKDWZHQHHGDGLIIHUHQWFRPPDQGIRUMXPSLIOHVVWKDQIRUXVHZLWKXQVLJQHGQXPEHUVZHDOVR

QHHGDGLIIHUHQWPQHPRQLF0RUHRYHUFRQVLGHULQJDOOWKHRWKHUMXPSFRQGLWLRQVJUHDWHUWKDQJUHDWHU

WKDQRUHTXDOWRHWFZHQHHGDZKROHQHZVHWRIFRPPDQGVDQGPQHPRQLFV7RV\VWHPDWL]HWKLVQHZVHW

WKHZRUGVDERYHDQGEHORZDUHXVHGLQSODFHRIWKHSKUDVHVJUHDWHUWKDQDQGOHVVWKDQ+HQFHWKHMXPSLI

OHVVWKDQFRPPDQGZKLFKZRUNVIRUXQVLJQHGQXPEHUVXVHVWKHPQHPRQLF

-%

IRUMXPSLIEHORZ7KH

IXOOVHWRIWKHVHFRPPDQGVLVDVIROORZV

-%EHORZ($;(%;

-%(EHORZRUHTXDO($; (%;

-$DERYH($;!(%;

-$(DERYHRUHTXDO($; (%;

-1%QRWEHORZ($;"(%;

-1%(QRWEHORZRUHTXDO($;"(%;

-1$QRWDERYH($;"(%;

-1$(QRWDERYHRUHTXDO($;"(%;

/LQX[

V

ILOHV

2QHRIWKHLQWHUPHGLDWHVWHSVWKDWJFFXVHVLQWKHWUDQVODWLRQRID&VRXUFHSURJUDPLQWRDQDRXWILOHLVDQ

DVVHPEO\ODQJXDJHILOH7KLVILOHLVWKHRXWSXWRIWKHFRPSLOHUSURSHUDQGWKHLQSXWWRWKHDVVHPEOHUJDV7R

VHHWKHVHDVVHPEOHUILOHVRQHFDQGLUHFWJFFWRRXWSXWWKHDVVHPEOHUILOHRQFHWKLVVWDJHLVUHDFKHGXVLQJWKH

6

VZLWFK7KLVRXWSXWKDVD

V

ILOHH[WHQVLRQ&RQVLGHUIRUH[DPSOHWKHIROORZLQJ&SURJUDPPXOWF

3URJUDP

PDLQ

^

LQW[\

UHJLVWHULQWDEF

SULQWI(QWHUDQXPEHU

VFDQIG [

SULQWI0XOWLSO\LWE\ZKDWQXPEHU"

VFDQIG \

D [

E \

F 

ZKLOHE 

^

F FD

E E

`

SULQWI7KHUHVXOWLVG?QF

`

6XSSRVHWKDWWKHQXPEHUV[ DQG\ DUHHQWHUHG7KLVSURJUDPDFWXDOO\RXWSXWVWKHFRUUHFWDQVZHU
DQGWRFDOFXODWHLWWKHORRSH[HFXWHV



 WLPHV1RWHWKDW

(DFKWLPHWKHUXQQLQJWRWDO

E

H[FHHGVWKHWXUQRYHUYDOXHRI







LVGURSSHGIURPWKHWRWDO7KLV

KDSSHQVIRXUWLPHV7KHUHVXOWLQJYDOXHRIELV



ZKLFKLVWKHWZR VFRPSOHPHQWUHSUHVHQWDWLRQRI



2QHRIWKHPDLQSUDFWLFDOXVHVRIDVVHPEO\ODQJXDJHSURJUDPPLQJLVLQWKHFRGLQJRIORRSVWKDWH[HFXWHVR

PDQ\WLPHVWKDWDQLPSURYHPHQWLQWKHWLPHUHTXLUHGIRUHDFKH[HFXWLRQDFWXDOO\PDNHVDQRWLFHDEOH

GLIIHUHQFHLQWKHWRWDOUXQWLPH,QDWHVWRQD0+]3HQWLXPWKHîFDOFXODWLRQUHTXLUHG

VHFRQGV7RREWDLQWKHDVVHPEO\FRGHIRUWKLVSURJUDPRQHFDQXVHWKHFRPPDQG

OLQX[ER[JFF6PXOWF

7KHUHVXOWLQJILOH

PXOWV

LVWKHDVVHPEO\FRGHZKLFKZDVXVHGE\JFFWRSURGXFHWKHH[HFXWDEOHILOH7KH

V\QWD[RIWKLVDVVHPEO\FRGHGLIIHUVIURPWKDWRIWKHZLGHO\XVHG,QWHODVVHPEO\ODQJXDJHXVHGLQWKLVERRN

EXWLWFDQVWLOOEHGHFLSKHUHG&RPPHQWVIRUWKLVSXUSRVHDUHDGGHG7KHILUVWOLQHXVHV

7(67

,WLVDQ

LQVWUXFWLRQ

3URJUDP

/

WHVWOHVLHVL,V(6, 

MQH/,IQRWJRWR/

MPS/RWKHUZLVHJRWR/

/

DGGOHE[HGL/HW(', (',(%;

GHFOHVL/HW(6, (6,

MPS/*RWR/

/

VLPLODUWR

&03

ZKLFKZLOOEHGLVFXVVHGLQWKHQH[WFKDSWHU

HVL

UHIHUVWRWKH(6,UHJLVWHU/LNH

&03

WKH

7(67

FRPPDQGVHWVWKH]HURIODJLI(6, 7KH

O

DWWKHHQGRIPDQ\RIWKHVHFRPPDQGVLVXVHGWRVSHFLI\

WKHOHQJWKRIWKHRSHUDQGORQJLQWKLVFDVHDQGWKDWPHDQVIRXUE\WHV1RWLFHWKDWWKHDGGXVHVD

&200$1'VRXUFHGHVWLQDWLRQRSHUDQGRUGHUWKHRSSRVLWHRIWKDWXVHGLQWKLVERRN

7KHORRSFRQVLVWVRIWKHVL[LQVWUXFWLRQVVKRZQ,IZHQRWHWKDWZHFDQWDNHVRPHMXPSVRXWRIWKHORRSE\

WHVWLQJZKHWKHU(6,LV]HURDWWKHHQGRIWKHORRSZHFDQUHGXFHWKHORRSIURPVL[LQVWUXFWLRQVWRWKUHH7KH

RQO\FKDQJHPDGHZDV

3URJUDP

/

WHVWOHVLHVL

MQH/

MPS/

/

DGGOHE[HGL

GHFOHVL

MQH/,I(6,LVQ WJRWR/

/

WRWKHMXPSDWWKHHQGRIWKHORRS7KHPRGLILHGILOHZDVFRPSLOHGXVLQJXVLQJJFF

OLQX[ER[JFFPXOWV

7KHUHVXOWLQJSURJUDPZDVUXQDQGWKHFRPSXWDWLRQRIîWRRNVHFRQGVRQWKHVDPHPDFKLQH

7KH3HQWLXP V'XDO3LSHOLQH

,IZHORRNDWWKHWLPHIRUHDFKLQVWUXFWLRQWRH[HFXWHLQWKHILUVWFDVHZHJHW

7KLVDULWKPHWLFDVVXPHVWKDWWKHSURJUDPVSHQWDOORILWVWLPHLQWKHORRS&RPSDULQJWKLVZLWKWKHOHQJWKRI

RQHFORFNF\FOH

ZHILQGWKHDPD]LQJUHVXOWWKDWWKHWLPHIRUWZRLQVWUXFWLRQVWRH[HFXWHQDQRVHFRQGVLVMXVWDOLWWOH

RYHURQHFORFNF\FOH6LQFHRQHLQVWUXFWLRQSHUFORFNF\FOHLVLGHDOXQGHURUGLQDU\FLUFXPVWDQFHVZKDWZH

KDYHKHUHLVVRPHWKLQJVSHFLDO,WLVDQLOOXVWUDWLRQRIWKH3HQWLXP VGXDOSLSHOLQH:KHQSRVVLEOHWKH

3HQWLXPSDLUVLQVWUXFWLRQVRIIDQGH[HFXWHVWZRDWRQFH7KLVLVKRZUDWHVRIPRUHWKDQRQHLQVWUXFWLRQSHU

FORFNF\FOHFDQEHDFKLHYHG7KHUHLVDFWXDOO\DQRWKHUSLSHOLQHIRUIORDWLQJSRLQWQXPEHUV7KHLQVWUXFWLRQ

SDLULQJDOVRH[SODLQVZK\WKHLPSURYHPHQWZHPLJKWKDYHH[SHFWHGZKHQZHUHGXFHGWKHQXPEHURI

LQVWUXFWLRQVLQWKHORRSIURPVL[WRWKUHHGLGQRWPDWHULDOL]H:KDWKDSSHQHGDSSDUHQWO\ZDVWKDWWKHQXPEHU

RILQVWUXFWLRQSDLUVZHQWIURPWKUHHWRWZRRQHRIWKHWZRSDLUVEHLQJKDOIHPSW\7KHWLPH

QDQRVHFRQGVLVRIQDQRVHFRQGV7KLVLVDSSUR[LPDWHO\WZRWKLUGVVXJJHVWLQJWKHXVHRIWZR

LQVWUXFWLRQSDLUVLQVWHDGRIWKUHHIRUHDFKSDVVWKURXJKWKHORRS

&KDSWHU0$&+,1(/$1*8$*(

0DFKLQHODQJXDJHLVWKHODQJXDJHVHHQE\WKHSURFHVVRU7KHE\WHVIHWFKHGLQWKHIHWFKH[HFXWHF\FOHDUH

E\WHVRIPDFKLQHFRGH$VVHPEO\ODQJXDJHFDQEHGHILQHGDVODQJXDJHZKLFKJLYHVWKHSURJUDPPHUFRQWURO

RYHUWKHPDFKLQHFRGH$VVHPEO\ODQJXDJHVSHFLILHVPDFKLQHFRGH7KLVFKDUDFWHULVWLFIHDWXUHRIDVVHPEO\

ODQJXDJHZLOOQRWEHDSSDUHQWZLWKRXWVRPHIDPLOLDULW\ZLWKPDFKLQHODQJXDJH,QWKLVFKDSWHUWKHPDLQ

IHDWXUHVRI[PDFKLQHFRGHDUHSUHVHQWHG

7KHSURFHVVRIFRQYHUWLQJDVVHPEO\FRGHLQWRPDFKLQHFRGHLVFDOOHGDVVHPEOLQJ$SURJUDPZKLFKWDNHV

DVVHPEO\ODQJXDJHDVLQSXWDQGSURGXFHVPDFKLQHODQJXDJHDVRXWSXWLVFDOOHGDQDVVHPEOHU,WLVVLPLODUWR

DFRPSLOHUEXWLWRSHUDWHVDWDORZHUOHYHO

&RQYHUVHO\WKHSURFHVVRIWXUQLQJPDFKLQHFRGHLQWRDVVHPEO\ODQJXDJHLVFDOOHGXQDVVHPEOLQJ$SURJUDP

ZKLFKGRHVWKLVLVFDOOHGDQXQDVVHPEOHU

$VVHPEOLQJ6LPSOH3URJUDPV

7RWHOOWKHZKROHVWRU\RIWKHPDFKLQHFRGHIRUWKH[SURFHVVRUVLQYROYHVDORWRIWULFN\GHWDLO+RZHYHULW

LVTXLWHHDV\WRVSHFLI\PDFKLQHFRGHIRUWKHVXEVHWRIWKH[DVVHPEO\ODQJXDJHXVHGLQDOOWKHQXPEHUHG

SURJUDPVXVHGLQVHFWLRQVWKURXJK&RGLQJIRUWKLVSRUWLRQRI[DVVHPEO\ODQJXDJHLVJLYHQLQ

7DEOH

0RVWRIWKHPDFKLQHFRGHLVJLYHQLQKH[EXWVRPHRIWKHE\WHVKDYHWREHJLYHQLQELQDU\7KH

QXPEHURIE\WHVYDULHVIURPRQHWRVL[7KHILUVWOLQHRIWKHWDEOHIRUH[DPSOHVKRZVWKDWWKHFRGHIRU

029

UHJUHJLVDWZRE\WHFRGHWKHILUVWRIZKLFKLVJLYHQLQKH[DQGWKHVHFRQGLQELQDU\7KHE\WHVJLYHQLQ

ELQDU\DUHWKRVHZKLFKLQFRUSRUDWHUHJLVWHUFRGHV666LQWKHELQDU\FRGLQJUHSUHVHQWVWKHWKUHHELWFRGHIRU

WKHVRXUFHUHJLVWHU'''UHSUHVHQWVWKHWKUHHELWFRGHIRUWKHGHVWLQDWLRQUHJLVWHU7KHUHJLVWHUFRGHVDUH

JLYHQDWWKHERWWRP(DFKLPPRFFXUULQJLQDFRPPDQGVSHFLILHVIRXUDGGLWLRQDOE\WHVZKLFKPXVWEH

VXSSOLHGE\WKHSURJUDPPHU([DPSOHVIROORZ8VLQJ

7DEOH



3URJUDP

FDQEHPDFKLQHDVVHPEOHGDV

IROORZV

>@

,IUHJLV($;WKHUHLVDVKRUWHUPDFKLQHFRGH

5HJLVWHU&RGHV

7KHILUVWE\WHRIWKHILUVWFRPPDQG%$LVHQFRGHGXVLQJWKH'''FRGHJLYHQIRU

029

UHJLPP7KH

'''ELWVDUHILOOHGLQZLWKWKHUHJLVWHUFRGHIRU(';ZKLFKUHVXOWVLQDELQDU\FRGHRIRUD

KH[FRGHRI%$

7KHVHFRQG

029

FRPPDQG

029(&;($;

LVHQFRGHGDV&XVLQJWKHILUVWOLQHRIWKHFKDUWZKLFKVSHFLILHV

WKHVHFRQGE\WHDV666'''($;LVWKHVRXUFHUHJLVWHUDQGLWVFRGHLV(&;LVWKHGHVWLQDWLRQ

UHJLVWHUDQGLWVFRGHLV7KHUHVXOWLQJVHFRQGE\WHLVZKLFKLV&

3URJUDP

/DEHO6RXUFH&RGH$GGUHVV0DFKLQH&RGH

7DEOH6RPH%LW0DFKLQH&RGLQJ

)LUVW%\WH

6HFRQG%\WH

0RUH

029

UHJUHJ



666'''

029

UHJLPP

'''

BBB

$''

UHJUHJ



666'''

$''

UHJLPP



'''

>@

BBB

68%

UHJUHJ



666'''

68%

UHJLPP



'''

>@

BBB

,1&

UHJ

'''

'(&

UHJ

'''

,1

($;>';@

('

287

>';@($;

()

5(7

&

-03

LPP

(

BBB

-=

LPP

)



BBB

-1=

LPP

)



BBB

-6

LPP

)



BBB

-16

LPP

)



BBB

029(';%$





,1($;>';@('

029(&;($;&

,1($;>';@('

029(';($;&

25'68%($;(&;%&

-=*&'')

)



-161;7)





029($;(&;&

029(&;(';%'

1;7029(';($;'&

-0325')((

))))

))

*&'029($;(';'

029(';%$



$

287>';@($;%()

5(7&&

/LWWOH(QGLDQ,PPHGLDWH&RGHV

7KHILUVWDQGODVW

029

FRPPDQGVLQWKLVSURJUDPERWKFRQWDLQLPPHGLDWHYDOXHV%RWKRIWKHVHVWRUHIRXU

E\WHYDOXHVLQIRXUE\WHUHJLVWHUV1RWLFHLQWKHODVW

029

FRPPDQGWKHIRXUE\WHLPPHGLDWHYDOXH

+LVVWRUHGDV

5HODWLYH-XPSV

7KHMXPSHQFRGLQJXVHGE\[SURFHVVRUVXVHVUHODWLYHUDWKHUWKDQDEVROXWHDGGUHVVHVZKHQWKLVLVIHDVLEOH

$OOWKHMXPSLQVWUXFWLRQVLQWKLVSURJUDPHQFRGHMXPSVDVUHODWLYHMXPSV$QDEVROXWHMXPSZRXOGVSHFLI\

DQDFWXDODGGUHVVDVWKHWDUJHWRIDMXPSZKHUHDVUHODWLYHHQFRGLQJVSHFLILHVWKHQXPEHURIE\WHVWRMXPS

VWDUWLQJIURPWKHEHJLQQLQJRIWKHQH[WLQVWUXFWLRQ7KLVYDOXHPD\EHLQWHUSUHWHGDVDVLJQHGQXPEHUD

QHJDWLYHYDOXHIRUDEDFNZDUGVMXPS7KHHQFRGHGYDOXHLVDGGHGE\WKHSURFHVVRUWRWKHDGGUHVVRIWKHQH[W

LQVWUXFWLRQWRREWDLQWKHDGGUHVVRIWKHLQVWUXFWLRQEHLQJMXPSHGWR)RUH[DPSOHWKH

-031;7

LQVWUXFWLRQ

KDVDOLWWOHHQGLDQHQFRGHGFRXQWLQJIRXUE\WHVIURPWKHE\WHWKDWEHJLQVWKH

029($;(&;

EULQJV

\RXWRWKHE\WHWKDWEHJLQV

029(';($;

7KLVFRPPDQGLVWKHWDUJHWRI

-031;7

7KH

-0325'

LQVWUXFWLRQFRQWDLQVWKHUHODWLYHMXPSYDOXH))))))(+ &RXQWLQJEDFNZDUGVE\WHVIURPWKH

E\WHWKDWEHJLQVWKH

029($;(';

EULQJV\RXWRWKHE\WHWKDWLVWKHILUVWE\WHRIWKHFRGHIRU

68%($;

(&;

6KRUW-XPSV

7KHUHODWLYHMXPSYDOXHVLQWKHSURJUDPDUHHDFKHQFRGHGLQIRXUE\WHVLQVSLWHRIWKHIDFWWKDWWKHYDOXHV

DQGILWHDVLO\LQWKHRQHE\WHVLJQHGUDQJH7KHUHDUHDOWHUQDWHHQFRGLQJVZKLFKFDQEHXVHGWR

VDYHVSDFHRQRQHE\WHMXPSV7KHVHMXPSVDUHFDOOHGVKRUWMXPSV7KHVKRUWMXPSHQFRGLQJIRUWKH

-16

1;7

LQVWUXFWLRQIRUH[DPSOHLV7KHPDFKLQHFRGHVIRUWKHFRQGLWLRQDOVKRUWMXPSVFDQEHREWDLQHG

IURPWKHLUELWFRXQWHUSDUWVE\GURSSLQJWKH2)E\WHDQGVXEWUDFWLQJ+IURPWKHVHFRQGE\WH7KHVKRUW

FRGHIRUWKH

-03

FRPPDQGLV(%,Q(GOLQDVDORQJMXPSFDQEHFRQYHUWHGWRDVKRUWMXPSXVLQJWKHVNH\

,Q1$60WKHXQDGRUQHG

-03

LQVWUXFWLRQDOZD\VPHDQVDVKRUWMXPS$

-03

LQVWUXFWLRQZKLFKFDQ WEH

HQFRGHGLQRQHE\WHJHWVDQHUURUPHVVDJH7RVSHFLI\DMXPSZKLFKXVHVWKHORQJHUHQFRGLQJ

-031($5

LV

XVHG,QWKHSUHVHQWFRQWH[WMXPSLQJIDUZRXOGVHHPWRPDNHPRUHVHQVHWKDQMXPSLQJQHDUEXWDIDU

MXPSDFWXDOO\UHIHUVWRDMXPSZKLFKXVHVDEVROXWHHQFRGLQJDVZLOOEHVHHQLQ

FKDSWHU



6LQFHPRVWMXPSVDUHQRPRUHWKDQE\WHVLWPDNHVVHQVHWRKDYHDVSHFLDOHQFRGLQJIRUWKHP7KH

LQVWUXFWLRQVHWIRUWKHDFWXDOO\KDGRQO\WKHVKRUWYHUVLRQVRIWKHFRQGLWLRQDOMXPSV7KH2)ORQJMXPS

FRGHVGLGQRWDSSHDUXQWLOWKH

2SFRGH6SDFH

7KHPDFKLQHFRGHVJLYHQLQWKHODVWVHFWLRQFDQEHXVHGWRDVVHPEOHDJUHDWYDULHW\RIVLPSOHSURJUDPV2Q

WKHRWKHUKDQGWDNHQWRJHWKHUWKH\UHSUHVHQWRQO\DVPDOOSRUWLRQRIWKHFRPSOHWH[LQVWUXFWLRQVHW,QWKLV

VHFWLRQDQRYHUYLHZRIWKHHQWLUHVHWRI[PDFKLQHFRGHVLVJLYHQ7DEOHVKRZVZKDWLQIRUPDWLRQLV

FRQYH\HGE\WKHILUVWE\WHRIPDFKLQHFRGH

0RVWRIWKHHQWULHVLQWKHWDEOHFRQWDLQERWKPQHPRQLFDQGRSHUDQGLQIRUPDWLRQ,QDIHZFDVHVWKLV

LQIRUPDWLRQVSHFLILHVERWKFRPSOHWHO\7KHHQWU\LQWKHWDEOHIRUWKHE\WH((IRUH[DPSOHLV

287

>';@$/

,QRWKHUFDVHVWKHPQHPRQLFLVJLYHQEXWDFODVVRIDOORZDEOHRSHUDQGVDUHGHVFULEHGXVLQJOHWWHUNH\V

z

UVWDQGVIRUUHJLVWHU

z

PVWDQGVIRUPHPRU\

z

LVWDQGVIRULPPHGLDWH

z

EVWDQGVIRUE\WH

z

VWDQGVIRUE\WHV

z

YPHDQVELWVRUELWV

z

HPHDQV(LQELWVDQGGLVDSSHDUVLQELWV

7KHVHNH\VZHUHXVHGE\6WHSKHQ0RUVHLQWKHH[FHOOHQWERRN$UFKLWHFWXUH

&RQVLGHUWKHHQWU\LQWKHWDEOHIRUWKHE\WH

$''

UYUPY

6LQFHWKHILUVWRSHUDQGSRVLWLRQFRQWDLQVUYWKLVLQGLFDWHVWKDWWKHILUVWRSHUDQGPXVWEHDRUDELW

UHJLVWHU6LQFHWKHVHFRQGSRVLWLRQFRQWDLQVUPYWKHVHFRQGRSHUDQGPXVWEHDRUELWUHJLVWHURU

PHPRU\RSHUDQG6LQFH(',DQG($;DUHELWUHJLVWHUVZHVHHWKDW

$''(',($;

LVDQH[DPSOHRIDQ

LQVWUXFWLRQZKLFKFDQEHHQFRGHGZLWKFRGHZKRVHILUVWE\WHLV$QRWKHUH[DPSOHLV

$''(',>+@

7KHW\SHRILQIRUPDWLRQFRQYH\HGE\WKHILUVWE\WHRIFRGHFDQEHEURNHQGRZQLQWRFDVHV

 ,QDIHZFDVHVWKLVRQHE\WHVXIILFHVWRFRPSOHWHO\VSHFLI\DQLQVWUXFWLRQ)IRUH[DPSOHVSHFLILHV

WKHKDOWLQVWUXFWLRQ

+/7

 ,QPDQ\RWKHUFDVHVDOWKRXJKWKHILUVWE\WHGHWHUPLQHVZKLFKRSHUDWLRQLVWREHSHUIRUPHGLWGRHVQRW

VSHFLI\WKHRSHUDQGV,QWKHVHFDVHVDVHFRQGE\WHLVRIWHQVXIILFLHQWWRFDUU\WKHRSHUDQGLQIRUPDWLRQ

7KLVVHFRQGE\WHLVFDOOHGWKH0RG50E\WH)RUH[DPSOHLIWKHILUVWE\WHLVWKHQWKHWDEOHHQWU\LV

029

UPYUY,QDGGLWLRQWRVSHFLI\LQJWKHRSHUDWLRQ

029

WKHUPYUYRSHUDQGNH\VFRQYH\LQIRUPDWLRQ

RQKRZWKH0RG50E\WHLVWREHLQWHUSUHWHG

 7KHUHDUHDOVRFDVHVZKHUHWKHILUVWE\WHGRHVQRWIXOO\VSHFLI\DQRSHUDWLRQEXWPHUHO\DJHQHUDOW\SH

RIRSHUDWLRQDQGWKH0RG50E\WHLVXVHGWRFRPSOHWHWKHVSHFLILFDWLRQRIWKHRSHUDWLRQDVZHOODV

FDUU\RSHUDQGLQIRUPDWLRQ)RUH[DPSOHLIWKHILUVWE\WHLV&WKHQWKHWDEOHHQWU\LV6KLIWUPYLE,Q

WKHVHFDVHVWKHIXOOLQWHUSUHWDWLRQRIWKH0RG50E\WHUHTXLUHVPRYLQJWR

7DEOH

6KLIWLVQRWD

PQHPRQLF,WLVRQO\DSRLQWHULQWR

7DEOH

7KLVLVLQGLFDWHGLQWKHWDEOHE\WKHIDFWWKDWQRWDOORILWV

OHWWHUVDUHXSSHUFDVH

 ,IWKHILUVWE\WHLV2)WKHQDZKROHUDIWRISRVVLELOLWLHVLVRSHQHGXS7KHLQIRUPDWLRQFRQYH\HGE\2)

LVPHUHO\JRWR7DEOH

 ,IWKHILUVWE\WHLVLQWKHUDQJH'')WKHQWKHFRPPDQGLVDIORDWLQJSRLQWFRPPDQG7KHVH

FRPPDQGVDUHQRWGHDOWZLWKLQWKLVWH[W

 7KHUHDUHDOVRSUHIL[E\WHVZKLFKPRGLI\WKHVXEVHTXHQWFRPPDQGV,Q7DEOHWKHSUHIL[E\WHV

VXFKDVWKH

/2&.

SUHIL[)DUHVKRZQDVERWWRPVLWWHUV

7KHVHYDULRXVFDVHVDUHGHDOWZLWKRQHE\RQHLQWKHIROORZLQJVHFWLRQV

7KH0RG50%\WH

7KH0RG50E\WHLVXVHGWRFDUU\RSHUDQGLQIRUPDWLRQZKHQWKHILUVWE\WHFDQQRWGRVR7KH0RG50E\WH

FRQVLVWVRIWKUHHSDUWV

 %LWVDQGDUHWKH0RGELWV:KHQWKH0RGELWVDUHWKH0ELWVGHVLJQDWHDUHJLVWHU2WKHUZLVH

WKH0ELWVDUHXVHGIRUPHPRU\FRGLQJ

 %LWVDQGDUHWKH5RUUHJLVWHUELWVDQGDUHRIWHQGHVLJQDWHGXVLQJDVODVKQRWDWLRQU

 %LWVDQGDUHWKH0RUPHPRU\ELWVDQGDUHXVHGWRVSHFLI\RUKHOSVSHFLI\DPHPRU\ORFDWLRQ

H[FHSWZKHQWKH0RGELWVDUH

UYUPY&RGLQJ

7KHHQWU\LQ7DEOHIRUWKHE\WHLV

7DEOH)LUVW%\WHRI2SFRGH6SDFH

0RG

5

0

















$''

UYUPY

:HFDQXVHWKLVHQWU\WRDVVHPEOHWKH

$''(',($;

FRPPDQG7KH

$''(',($;

FRPPDQGUHTXLUHVD

0RG50E\WH7KHPLQWKHVHFRQGRSHUDQGSRVLWLRQVSHFLILHVQRWRQO\WKDWWKHVHFRQGRSHUDQGPD\EHD

PHPRU\RSHUDQGEXWDOVRWKDWLWPXVWEHHQFRGHGLQWKH0ELWVRIWKH0RG50E\WH6LQFHWKHVHFRQG

RSHUDQGLVWKHUHJLVWHU($;WKHELWFRGHIRU($;RFFXSLHVWKH0ELWVLQWKH0RG50E\WH6LQFHZH

DUHXVLQJDUHJLVWHUIRUWKH0ELWVWKHWZR0RGELWVPXVWEH7KHILUVWRSHUDQGZKLFKDVWKHULQGLFDWHV

PXVWEHDUHJLVWHULVWKHUHIRUHHQFRGHGLQWKH5ELWVRIWKH0RG50E\WH(',LVWKHILUVWRSHUDQGDQGLWV

FRGHLV&RQVHTXHQWO\WKH0RG50E\WHLV

&RPELQLQJWKHZLWKWKH0RG50E\WH\LHOGVWKHFRGH)IRU

$''(',($;

,ILQWKLVFRGHZHFKDQJHWKHWZR0RGELWVIURPWRZHJHWWKHFRGHIRU

$''(',>($;@

+HUHWKH0

ELWVDUHXVHGIRUDQDFWXDOPHPRU\RSHUDQG7KHFRGHVDQGDUHXVHGWRFRGHIRULPPHGLDWH

GLVSODFHPHQWVVXFKDV

$''(',>($;@

ZKHUHWKHGLVSODFHPHQWLVHLWKHURIW\SHLERULY+HQFHWKH

FRGHIRU

$''(',>($;@

LV7KHFRGHIRU

$''(',>($;+@

LV%

,IWKLVFRGLQJZHUHGRQHXQLIRUPO\KRZHYHULWZRXOGOHDYHQRURRPLQWKHFRGLQJVSDFHIRUWKH

FRPSOLFDWHGIRUPDWVVHHQLQ

FKDSWHU



VHFWLRQ

7RPDNHVSDFHIRUFRGLQJWKHVHIRUPDWVWKHFRGHIRU

WKH(63UHJLVWHULVUHPRYHGWRSURYLGHDQHVFDSHLQWRDQRWKHUE\WHRIWKHFRGLQJVSDFHFDOOHGWKH6,%E\WH

UPYUY&RGLQJ

:KHQWKHUPYDQGUYNH\VDUHUHYHUVHGWKLVWXUQVWKHWKUHHELWFRGHVDURXQG$VDQH[DPSOHVXSSRVHZH

ZDQWWRFRGHWKHLQVWUXFWLRQ

029(',($;

7KHHQWU\IRU%PDWFKHVDQGFRXOGEHFRGHGZLWKWKHVDPH

0RG50E\WHDVWKH

$''(',($;

FRGH%XWWKHHQWU\DOVRPDWFKHV

029

UPYUY

8VLQJWKLVHQWU\ZHQRWHWKDWWKHILUVWRSHUDQGPD\EHDUHJLVWHUDQGLVFRGHGLQWKH0ELWV+HQFHWKHFRGH

IRU(',JRHVLQWRWKHOHDVWVLJQLILFDQWELWV7KHVHFRQGRSHUDQG($;LVFRGHGLQWKH5ELWV

+HQFHXVLQJWKHHQWU\LQ7DEOHZHREWDLQWKHHQFRGLQJ&IRU

029(',($;

1RQUHJLVWHU5%LWV

,QVRPHFDVHVWKHILUVWE\WHLVLQVXIILFLHQWWRVSHFLI\DQRSHUDWLRQEXWWKH5ELWVRID0RG50E\WHDUHXVHG

WRFRPSOHWHWKHVSHFLILFDWLRQ7KHVHFDVHVDUHOLVWHGLQ

7DEOH



68%(&;

LVDQH[DPSOH7KHHQWU\LQ

7DEOHIRULV

,PPHG

UPYLE

6LQFHWKHURZRI

7DEOH

ODEHOHG,PPHGKDVD

68%

XQGHUU ZHOHDUQWKDWLQVWUXFWLRQVPDWFKLQJ

0RG

5

0

































 )+

0RG

5

0

































 &+

68%

UPYLE

FDQEHFRGHGXVLQJDVWKHILUVWE\WHDQGIRUWKH5ELWVRIWKH0RG50E\WH6LQFHWKHILUVWRSHUDQG

(&;LVQRWPHPRU\WKH0RGELWVPXVWEHDQGWKH0ELWVZLOOEHILOOHGZLWKWKHFRGHIRU(&;6R

WKHUHTXLUHG0RG50E\WHLV

7KHLEVWDQGVIRUDQLPPHGLDWHE\WH6RWKHFRGHIRU

68%(&;

LV(

6SDFH2)«

2QDQWKHE\WH2)FRGHVIRUWKHLQVWUXFWLRQ

323&6

2QVXEVHTXHQWSURFHVVRUVWKLVLQVWUXFWLRQZDV

UHPRYHGWRPDNHWKH2)FRGHDYDLODEOHIRUDVLJQLILFDQWH[SDQVLRQLQWKHLQVWUXFWLRQVHW7DEOHUHYHDOV

WKHVSDFHZKLFKZDVRSHQHGXS/LNH7DEOHLWVKRZVWKHLQIRUPDWLRQFRQYH\HGE\DVLQJOHE\WHLQWKLV

FDVHWKHE\WHIROORZLQJDQLQLWLDO2)E\WH$IHZRIWKHLQVWUXFWLRQVLQ7DEOHDSSHDUHGILUVWRQWKH

WKHRUWKH3HQWLXPEXWPRVWRIWKHPDSSHDUHGILUVWRQWKH7KHEXONRIWKHLQVWUXFWLRQVQHZWR

WKHDUHLQ7DEOH

 $VZLWK7DEOHVRPHWLPHVRQHHQWU\VSHFLILHVH[DFWO\RQHLQVWUXFWLRQ)RUH[DPSOH2)&$LVWKH

FRGHIRUWKHLQVWUXFWLRQ

%6:$3(';

%\WH6:$3WKH(';UHJLVWHU

 6RPHWLPHVD0RG50E\WHLVQHHGHGWRFRQYH\RSHUDQGLQIRUPDWLRQ7KH

;$''

LQVWUXFWLRQZKRVHILUVW

WZRE\WHVDUH2)&LVDQH[DPSOHRIWKLV

 6RPHWLPHVD0RG50E\WHLVXVHGWRVSHFLI\DQRSHUDWLRQ)RUH[DPSOHLIWKHILUVWWZRE\WHVRIWKH

LQVWUXFWLRQDUH2)WKHQZHPXVWFKHFN5ELWVRIWKH0RG50E\WHWRGHWHUPLQHWKHRSHUDWLRQ

)URP

7DEOH

ZHVHHWKDWLIWKHUHJLVWHUELWVLQWKH0RG50E\WHZHUHWKHQWKHLQVWUXFWLRQZRXOG

EHDQ

/,'7

LQVWUXFWLRQ/RDGWKH,QWHUUXSW'HVFULSWRU7DEOH

7DEOH,QVWUXFWLRQV6SHFLILHGE\5%LWV

U

















,PPHG

$''

25

$'&

6%%

$1'

68%

;25

&03

6KLIW

52/

525

5&/

5&5

6+/

6+5

6$5

8QDU\

7(67L

127

1(*

08/

,08/

',9

,',9

,QF'HF

,1&

'(&

,QGLU

,1&

'(&

&$//P

&$//)$5P

-03

-03)$5

386+

0RG

5

0

































 (+

7DEOH6SDFH

 6RPHRIWKHFRGHVUHIHUWR00;LQVWUXFWLRQV7KHVHLQVWUXFWLRQVDUHGLVFXVVHGLQWKH,QWHOERRN7KH

&RPSOHWH*XLGHWR00;7HFKQRORJ\

:HOHDUQWKDWLQVWUXFWLRQVPDWFKLQJ

7DEOH

FRQWDLQ3HQWLXPDQG00;LQVWUXFWLRQVDVZHOODV

LQVWUXFWLRQV)RUH[DPSOHWKH

;$''

DQG

%6:$3

LQVWUXFWLRQVILUVWDSSHDUHGRQWKHDQGWKH

&38,'

DQG

5'76&

ILUVWDSSHDUHGRQWKH3HQWLXP

%LWYV%LW&RGH

7RWKLVSRLQWZHKDYHGLVFXVVHGPDFKLQHFRGHVIRUFRPPDQGVLQYROYLQJELWJHQHUDOUHJLVWHUVRQO\:H

DUHQRZUHDG\WRFRQVLGHUWKHFRGLQJRIWKHELWJHQHUDOUHJLVWHUV

7KH

029(&;($;

FRPPDQGDVQRWHGLQ

VHFWLRQ

FDQEHHQFRGHGDV&7KHFRUUHVSRQGLQJELW

FRPPDQGLV

029&;$;

6XUSULVLQJO\WKHFRGHIRUWKLVFRPPDQGLVDOVR&O7KHZDVGHVLJQHGWR

XVHWKHVDPHHQFRGLQJVIRUWKHELWUHJLVWHUVDVIRUWKHELWUHJLVWHUV&OHDUO\WKHUHLVDSUREOHPZLWK

WKLV:KHQWKHSURFHVVRUIHWFKHVWKHE\WHV&OZKLFKLQVWUXFWLRQVKRXOGEHH[HFXWHG

029(&;($;

RU

029

&;$;"

,WVRKDSSHQVWKDWWKHGHFLVLRQLVEDVHGRQDVLQJOHELWLQWKHSURFHVVRU7KLVELWGHWHUPLQHVZKHWKHU

FRGHLVLQWHUSUHWHGDVELWFRGHLQZKLFKFDVH&PHDQV

029(&;($;

RUELWFRGHLQZKLFKFDVH

&PHDQV

029&;$;

:KHQWKHELWLVVHWLWGRHVQRWPHDQWKDWWKHLQVWUXFWLRQ

029&;$;

LVXQDYDLODEOH7RHQFRGHWKHIDFWWKDW

WKHELWFRGLQJSUHVXPSWLRQLVZURQJDRQHE\WHSUHIL[LVXVHG6RLQELWFRGH&LVWKHFRGH

IRU

029&;$;

6LPLODUO\WKH

029(&;($;

LQVWUXFWLRQLVDYDLODEOHLQELWFRGH7KHFRGHIRULWLV&O

7KLVSUHIL[LVFDOOHGWKHRSHUDQGVL]HSUHIL[,WPHDQVWKDWWKHRSHUDQGVL]HLVQRWWKHGHIDXOWVL]H

7\SLFDOO\WKHELWLVVHWZKLOHUXQQLQJ/LQX[IRUH[DPSOHDQGFOHDUHGZKLOHUXQQLQJ'26([FHSWZKHUH

VSHFLILFDOO\VWDWHGRWKHUZLVHFRGHJLYHQLQWKLVERRNDVVXPHVWKHSURFHVVRU VELWLVVHWIRUWKHELWGHIDXOW

+HQFH&PHDQV

029(&;($;

DQG&PHDQV

029&;$;

1RZWKDWZHVHHKRZWKHFRGH&

FDQKDYHHLWKHURQHRIWZRSRVVLEOHPHDQLQJVLWLVHDV\WRH[SODLQWKHYLQ

7DEOH),QVWUXFWLRQV6SHFLILHGE\5%LWV

U

















/RFDO7

6/'7

UP

675

UP

//'7

UP

/75

UP

9(55

UP

9(5:

UP

*OREDO7

6*'7

P

6,'7

P

/*'7

P

/,'7

P

60:6

UP

/06:

UP

%LWV

%7

UPYLE

%76

UPYLE

%75

UPYLE

%7&

UPYLE

7DEOHYV%LW&RGLQJ([DPSOH

%LW&RGH

%LW&RGH

029(&;($;

&

&O

029&;$;

&

&

WKHHQWU\LQWKHILUVWFKDUWIRUWKHFRGH

029

UPYUY

7KHYLQHDFKRSHUDQGPDUNHUVWDQGVIRUYDULDEOHZKHUHYDULDEOHUHIHUVWRWKHIDFWWKDWWKHVL]HPD\EHHLWKHU

RUELWV6LPLODUO\WKHHLQUHJLVWHUGHVLJQDWLRQVVXFKDVH$;UHIHUVWRWKHIDFWWKDWLQELWFRGLQJ

($;LVLQWHQGHGDQGLQELWFRGLQJ$;LVLQWHQGHG

7KH%LW5HJLVWHUV

$OWKRXJKWKHELWDQGELWUHJLVWHUFRPPDQGVDUHIRUFHGWRVKDUHRSFRGHVWKHHLJKWELWUHJLVWHUV

JHQHUDOO\KDYHGHGLFDWHGRSFRGHV)RUH[DPSOHWKHRSFRGH$GHVLJQDWHVDQHLJKWELW

029

LQVWUXFWLRQ7KH

HQWU\LQ7DEOHIRU$LV

029

UEUPE

UEVWDQGVIRUUHJLVWHUE\WHDQGLVFRGHGIRULQWKHUHJLVWHUELWVRIWKH0RG50E\WHUPEVWDQGVIRUUHJLVWHU

RUPHPRU\E\WHDQGLVFRGHGIRULQWKHPHPRU\ELWVRIWKH0RG50E\WH$&LVWKHFRGHIRU

029$/&/

7DEOH

OLVWVWKHHLJKWELWUHJLVWHUFRGHV7KHFRGHIRU&/JRHVLQWRWKH0ELWVDQGWKHFRGHIRU$/JRHV

LQWRWKH5ELWV

&RPELQLQJWKHWZRE\WHV\LHOGV$&

/LQX[



)LOHV

3URJUDPVLQ&ZKLFKLQFOXGHFDOOVWRIXQFWLRQVVXFKDV

SULQWI

RU

VFDQI

UHTXLUHOLQNLQJWRWKH

FRPSLOHGFRGHIRUWKHVHIXQFWLRQV7KLVFRGHLVVWRUHGLQOLEUDULHVVXFKDV

OLEFVR

2QFHWKLVOLQNLQJLV

GRQHWKHSURJUDPEHFRPHVPXFKORQJHU,QRUGHUWRH[DPLQHWKHPDFKLQHFRGHRIDSURJUDPLWLVHDVLHUWR

ORRNDWWKHFRGHEHIRUHWKLVOLQNLQJLVGRQHEHFDXVHWKHUHLVVRPXFKOHVVRILW7KLVFRGHLVVWRUHGLQREMHFW

PRGXOHVZLWKD

R

ILOHH[WHQVLRQ7KHDQDORJRXVILOHVLQ'26DUHWKH2%-ILOHV7RLQVWUXFWWKHJQX&

FRPSLOHUWRSURGXFHD

R

ILOHWKHFVZLWFKFDQEHXVHG7KHFRPPDQG

OLQX[ER[JFFFPXOWF

SURGXFHVD

PXOWR

ILOH7KLVILOHFRQWDLQVWKHPDFKLQHFRGHRIWKHSURJUDPLQDGGLWLRQWRWDEOHVZKLFK

DOORZWKHOLQNHUWRGRLWVMRE

7RH[DPLQHDQREMHFWFRGHILOHRQHPD\XVHHLWKHUWKHRESURJUDPREMHFWGXPSZKLFKFRPHVZLWKWKLV

ERRNRUWKHRGSURJUDPRFWDOGXPSZKLFKLVDVWDQGDUG8QL[XWLOLW\7RJHWRGWRGLVSOD\LQKH[XVHWKH

VZLWFKHVW[DQG$[

OLQX[ER[RGW[$[PXOWR

7DEOH&RGHVIRU%LW5HJLVWHUV

&RGHVIRU%LW5HJLVWHUV

$/



$+



&/



&+



'/



'+



%/



%+



0RG

5

0

































REKDVQRVZLWFKHV

OLQX[ER[REPXOWR

&KDSWHU0(025<

,Q

FKDSWHU



VHFWLRQ

ZHQRWHGWKDWWKH

029

FRPPDQGFDQEHXVHGWRWUDQVIHUGDWDWRDQGIURPPHPRU\

MXVWDV

,1

DQG

287

FDQEHXVHGWRWUDQVIHUGDWDWRDQGIURP,2GHYLFHV)RUWKHSURJUDPPHUXVLQJ

029

WR

DFFHVVPHPRU\LVVLPSOHMXVWHQFORVHDQDGGUHVVLQEUDFNHWV,QQHLWKHU'26QRU/LQX[KRZHYHUDUHWKH

DGGUHVVHVHQFORVHGE\EUDFNHWVDFWXDOPHPRU\DGGUHVVHV,Q'26DQDGGUHVVSURFHVVLQJPHFKDQLVPFDOOHG

VHJPHQWDWLRQLVXVHGDQGLQ/LQX[DQRWKHURQHFDOOHGSDJLQJLVXVHG%XWWKHVHPHFKDQLVPVFDQEH

FLUFXPYHQWHG,QWKLVFKDSWHUZHPDNHWKHVLPSOLI\LQJDVVXPSWLRQWKDWWKLVLVGRQHVRWKDWDGGUHVVHV

HQFORVHGLQEUDFNHWVDUHDFWXDOKDUGZDUHDGGUHVVHV3URJUDPVZULWWHQRQWKLVEDVLVUXQXQGHU(GOLQDV

6HJPHQWDWLRQDQGSDJLQJZLOOEHGHDOWZLWKODWHU6HJPHQWDWLRQLVGLVFXVVHGLQ

FKDSWHU

DQGSDJLQJLV

GLVFXVVHGLQ

FKDSWHU



%\WH'DWD:LGWK

'DWDWUDQVIHUEHWZHHQDSURFHVVRUDQGLWVPHPRU\LVHDV\ZKHQZRUGVL]HDQGUHJLVWHUVL]HDJUHH)RU

H[DPSOHWKHSURFHVVRUIHWFKHVHLJKWELWZRUGVLQWRLWVHLJKWELWUHJLVWHUV(LJKWELWUHJLVWHUVDUHRI

FRXUVHPDLQO\DWKLQJRIWKHSDVW%XWHLJKWELWZRUGVZHVWLOOKDYH,QWHOKDVLPSOHPHQWHGPDQ\PHDVXUHV

VRWKDWLWVQHZSURFHVVRUVZRXOGUXQROGVRIWZDUH2QHRIWKHVHKDVEHHQWKHPDLQWDLQHQFHRIHLJKWELW

ZRUGVGHVSLWHWKHIDFWWKDWERWKSURFHVVRUUHJLVWHUVDQGGDWDWUDQVIHUVORQJDJRRXWJUHZWKHHLJKWELWVL]H

7KHSURFHVVRUIRUH[DPSOHKDVELWUHJLVWHUVDQGELWGDWDWUDQVIHUV

:KHQUHJLVWHUDQGZRUGVL]HVGRQ WPDWFKVLPSOHWUDQVIHUFRPPDQGVQRORQJHUPDNHVHQVH)RUH[DPSOH

ZLWKRXWVRPHIXUWKHUSURWRFROVLQSODFHWKHFRPPDQG

029>+@($;

GRHVQRWPDNHVHQVH7KHPHPRU\ORFDWLRQUHIHUUHGWROLNHDOO,QWHOPHPRU\ORFDWLRQVLVDQHLJKWELW

ORFDWLRQ%XW($;RQWKHRWKHUKDQGLVDELWUHJLVWHU

6WRUDJH3URWRFROV

7ZRIXUWKHUSURWRFROVDUHXVHG

z

:KHQDQQE\WHWUDQVIHULVLQGLFDWHGE\DQDGGUHVVDWKHPHPRU\E\WHVUHIHUUHGWRDUHWKRVHDWWKH

DGGUHVVHVDD«DQ$OODUFKLWHFWXUHVGRWKLV

z

:KHQDQQE\WHQXPEHULVVWRUHGLQPHPRU\LWVE\WHVDUHVWRUHGLQRUGHURIVLJQLILFDQFHOHDVW

VLJQLILFDQWE\WHVLQWKHORZHVWDGGUHVVHV1XPHULFDOO\LQFUHDVLQJDGGUHVVHVFRUUHVSRQGWRLQFUHDVLQJ

E\WHVLJQLILFDQFH1RWDOODUFKLWHFWXUHVGRWKLV

7KHVHWZRSURWRFROVPDNHLWSRVVLEOHWRLQWHUSUHWWKH

029>+@($;

FRPPDQG$VVKRZQLQ

)LJXUH



WKHE\WHVLQ($;DUHVWRUHGLQDGGUHVVHV+$+%+DQG&+7KHOHDVWVLJQLILFDQWE\WHLQ($;LV

VWRUHGLQ+WKHQH[WLQ$+DQGVRRQ

3URJUDP

GHPRQVWUDWHVWKHXVHRIWKLVLQVWUXFWLRQ:KHQ

3URJUDP

LV

)LJXUH

029>+@($;

3URJUDP

7LQ\(GOLQDVSURJUDPZKLFKVWRUHVDQLQSXWQXPEHULQWRPHPRU\



,1($;>@

029>+@($;

5(7

UXQXQGHU(GOLQDVLWLVORDGHGVWDUWLQJDWDGGUHVV6LQFHPHPRU\ORFDWLRQVXSWRWKHDGGUHVV+DUHDOO

GLVSOD\HGZKHQWKLVSURJUDPLVORDGHGWKHH[HFXWLRQRIWKH

029

LQVWUXFWLRQLVGLUHFWO\REVHUYDEOH

/LWWOHDQG%LJ(QGLDQ$UFKLWHFWXUH

$UFKLWHFWXUHVZKLFKXVHWKHE\WHRUGHULQJJLYHQLQWKHVHFRQGRIWKHVHSURWRFROVDUHFDOOHGOLWWOHHQGLDQ

$UFKLWHFWXUHVZKLFKGRWKHRSSRVLWHDUHFDOOHGELJHQGLDQ

$OO,QWHOSURFHVVRUVDUHOLWWOHHQGLDQ([DPSOHVRIELJHQGLDQSURFHVVRUVDUH0RWRUROD VDQG

SURFHVVRUV0,36DQG3RZHU3&SURFHVVRUVFDQZRUNLQHLWKHUPRGH

,QRUGHUWRHQFRXUDJHVRIWZDUHGHYHORSHUVWRPLJUDWHDZD\IURPFRPSHWLQJKDUGZDUHDFRPPRQVWUDWHJHP

LVWRLQFRUSRUDWHFRPSDWLELOLW\IHDWXUHV$FRPSDWLELOLW\IHDWXUHDGGHGWRWKHSURFHVVRULVWKH

%6:$3

LQVWUXFWLRQ,WUHYHUVHVWKHE\WHRUGHULQJRIDQ\ELWJHQHUDOUHJLVWHU,WVIRUPDWLVVLPSO\

%6:$3UHJ

)RUH[DPSOHLIWKH($;UHJLVWHUFRQWDLQHGWKHQXPEHU+WKHQIROORZLQJWKHH[HFXWLRQRIWKH

%6:$3($;

FRPPDQGLWZRXOGFRQWDLQWKHQXPEHU+

$OLJQPHQW

7KHGLVFUHSDQF\EHWZHHQWKHIRXUE\WHGDWDWUDQVIHUVL]HDQGWKHRQHE\WHZRUGVL]HZKLFKH[LVWVLQDQG

V\VWHPVLVQRWIXOO\UHIOHFWHGLQWKHKDUGZDUH,QIDFWWKHRQHE\WHZRUGVL]HLVDNLQGRIILFWLRQ

PDLQWDLQHGIRUWKHEHQHILWRIWKHVRIWZDUH$OWKRXJKPHPRU\RQWKHVHV\VWHPVLVIRUFHGWRHPXODWHDRQH

E\WHZRUGPHPRU\ZRUGVDUHDFWXDOO\IRXUE\WHVZLGH7KHWZRORZHVWELWVRIWKHELWDGGUHVVEXVDUHLQ

IDFWQRWWKHUH7KHZLUHVRQWKHDGGUHVVEXVDUH$WKURXJK$$DQG$DUHPLVVLQJ)URPDKDUGZDUH
SRLQWRIYLHZDDGGUHVVHV



ELWZRUGV7KH



îELWPHPRU\LVDILFWLRQ%XWEHFDXVHWKHILFWLRQ

LVFRQVLVWHQWO\PDLQWDLQHGVRIWZDUHZKLFKEHOLHYHVWKLVILFWLRQGRHVZRUN%XWLWGRHVQ WZRUNDVZHOODV

VRIWZDUHZKLFKWDNHVWKHWUXHVWDWHRIDIIDLUVLQWRDFFRXQW)RUH[DPSOHWKHFRPPDQG

029($;>+@

DFFHVVHVIRXUE\WHVRIPHPRU\ZKRVHELWDGGUHVVHVDUH









1RWHWKDWWKHVHDGGUHVVHVGLIIHURQO\LQWKHQRQH[LVWHQWERWWRPWZRELWV7KHVHIRXUE\WHVDUHDFWXDOO\MXVW

RQHIRXUE\WHZRUG7KHFRPPDQGFDQEHDFFRPSOLVKHGZLWKDVLQJOHPHPRU\WUDQVIHU2QWKHRWKHUKDQG

WKHFRPPDQG

029($;>+@

ZKLFKDOVRDFFHVVHVIRXUE\WHVRIPHPRU\FDQQRWEHFDUULHGRXWLQWKHVDPHZD\7KHELWDGGUHVVHVRI

WKHVHIRXUE\WHVDUH









7RDFFHVVWKHVHIRXUE\WHVWZRGLVWLQFWPHPRU\WUDQVIHUVDUHUHTXLUHG,QFRGHZKLFKLVDFFHVVLQJDODUJH

QXPEHURIFRQVHFXWLYHPHPRU\ORFDWLRQVIRXUE\WHVDWDWLPHSHUIRUPDQFHZLOOEHFXWLQKDOILIWKH

DGGUHVVHVFDOOHGDUHQRWWKRVHZKRVHERWWRPWZRELWVDUH]HURLHDPXOWLSOHRIIRXU0HPRU\WUDQVIHUV

ZKLFKVWUDGGOHIRXUE\WHZRUGERXQGDULHVDUHVDLGWREHRXWRIDOLJQPHQW6WDUWLQJZLWKWKHSURFHVVRUD

IODJZDVDGGHGZKLFKGHWHFWVPHPRU\WUDQVIHUVWKDWDUHRXWRIDOLJQPHQW

$GGUHVVHVLQ%UDFNHWV

7KHXVHRI

029

WRDFFHVVPHPRU\MXVWVFUDWFKHVWKHVXUIDFHRIDYDLODEOHPHPRU\FRPPDQGV$OORIWKH

HQWULHVLQ7DEOHFRQWDLQLQJRSHUDQGNH\VWKDWFRQWDLQDQPGHVFULEHFRPPDQGVWKDWDFFHVVPHPRU\

)URPWKHWDEOHZHFDQVHHWKDW

029$''25$'&6%%$1'68%

DQG

;25

DOODOORZPHPRU\

RSHUDQGVLQHLWKHUWKHVRXUFHRUWKHGHVWLQDWLRQRSHUDQGSRVLWLRQ0HPRU\RSHUDQGVPD\EHVXSSOLHGXVLQJ

VHYHUDOGLIIHUHQWIRUPDWV

7KH>LPP@)RUPDW

$OOWKHPHPRU\RSHUDQGH[DPSOHVSUHVHQWHGVRIDUKDYHXVHGWKH>LPP@IRUPDWZLWKWKH

029

LQVWUXFWLRQ

,OOXVWUDWLQJWKH>LPP@IRUPDWZLWKWKH

$''

FRPPDQGZHKDYHERWK

$''UHJ>LPP@

DQG

$''>LPP@UHJ

ZKHUHLPPFDQEHDQ\IRXUE\WHQXPEHU

$VZHDOONQRZPHPRU\PD\EHXVHGIRUVWRUDJHRIPDQ\NLQGVRIGDWDLQFOXGLQJWH[WJUDSKLFVDQG

QXPEHUV,QWKHIROORZLQJSDUDJUDSKVZHORRNDWKRZLWLVXVHGLQFRQQHFWLRQZLWKQXPEHUVLQSDUWLFXODU

ZLWKELJQXPEHUV

%LW$ULWKPHWLF

0HPRU\VSDFHLVPXFKODUJHUWKDQSURFHVVRUVSDFH:KHQQXPEHUVEHFRPHWRRODUJHIRUWKHSURFHVVRUWR

ZRUNZLWKWKHDULWKPHWLFFDQEHGRQHSLHFHPHDOZLWKSLHFHVVPDOOHQRXJKIRUWKHSURFHVVRUWRKDQGOH

ORDGHGLQIURPPHPRU\DVWKH\DUHQHHGHG6RPHIHDWXUHVRIWKHSURFHVVRUDUHGHVLJQHGZLWKWKLVNLQGRI

DULWKPHWLFLQPLQG7KH

$'&

LQVWUXFWLRQLVDFDVHLQSRLQW7KLVLQVWUXFWLRQPDNHVLWSRVVLEOHWRGRSLHFHPHDO

DGGLWLRQRIODUJHQXPEHUV6XSSRVHWKDWZHKDYHWKHQXPEHUV+DQG

$$$$%%%%&&&&''''+VWRUHGDWORFDWLRQV+DQG+LQPHPRU\DQGWKDWZHZDQWWRDGGWKHP

8VLQJWKH

$''

LQVWUXFWLRQRQWKHERWWRPIRXUE\WHVRIWKHVHQXPEHUVZLOOVHWWKHFDUU\IODJ8VLQJWKH

$'&

LQVWUXFWLRQRQWKHQH[WIRXUE\WHVWDNHVDFFRXQWRIWKHFDUU\7KH

$'&

LQVWUXFWLRQLVYHU\VLPLODUWRWKH

$''

LQVWUXFWLRQ,WPHDQV

ZKHUHDVWKHRUGLQDU\

$''

LQVWUXFWLRQPHDQV

7KHDGGLWLRQFDQWKHQEHFDUULHGRXWLQWZRVWDJHVWKHILUVWRQHXVLQJ

$''

DQGWKHQH[WRQHXVLQJ

$'&

,QRUGHUIRUWKHFDUU\LQJWRZRUNLWLVLPSRUWDQWWKDWQRWKLQJGLVWXUEWKHFDUU\IODJEHWZHHQWKHORZRUGHU

DGGLWLRQDQGWKHKLJKRUGHUDGGLWLRQ7KHIROORZLQJFRGHGRHVWKLVDULWKPHWLFXVLQJWKHHLJKWE\WHVVWDUWLQJDW

+DVWKHGHVWLQDWLRQDQGWKHHLJKWE\WHVVWDUWLQJDW+DVWKHVRXUFH:KHQWKLVSURJUDPILQLVKHVWKH

3URJUDP

E\WH'HVWLQDWLRQDW+

E\WH6RXUFHDW+

029($;>+@%RWWRP6RXUFHE\WHV

$''>+@($;$GGWRERWWRP'HVWLQDWLRQE\WHV

029($;>&+@7RS6RXUFHE\WHV

$'&>+@($;$GGWRWRS'HVWLQDWLRQE\WHV

HLJKWE\WHVXPLVORFDWHGLQWKHHLJKWE\WHVVWDUWLQJDWWKHDGGUHVV+:KHQWKH

$'&

LQVWUXFWLRQILQLVKHV

WKHRYHUIORZFDUU\DQGVLJQIODJVZLOOEHFRUUHFWIRUHLJKWE\WHDULWKPHWLF7KH]HURIODJGRHVQRWZRUNVR

ZHOOIRUHLJKWE\WHV:KHQVHWLWQHHGQRWLQGLFDWHWKDWWKHHLJKWE\WHVXPLV

3RZHUVRI

([SDQGLQJRQWKLVLGHDZHFDQFRGHDOLWWOHELWSRZHURIFDOFXODWRUXVLQJWKHIROORZLQJDOJRULWKP

,QLWLDOL]H\ 

7KHQUHSHDW

3URJUDP

KDVQRLQSXWRURXWSXW,WFDQEHREVHUYHGE\VWHSSLQJWKURXJKLWLQ(GOLQDV7KH>LPP@IRUPDW

LVXVHIXOLQUHIHUULQJWRDIHZIL[HGORFDWLRQVLQPHPRU\,WLVQRWXVHIXOLQSURFHVVLQJDORQJVXFFHVVLRQRI

E\WHVLQPHPRU\

3URJUDP

(GOLQDVSURJUDPZKLFKILQGVELWSRZHUVRI

6WRUHWKHE\WHVRI[VWDUWLQJDWPHPRU\DGGUHVV+

6WRUHWKHOHDVWVLJQLILFDQWE\WHVRI\LQ($;

6WRUHWKHPRVWVLJQLILFDQWE\WHVRI\LQ(%;



\ 

029($;

029(%;

029(';

[ \

$%&029>+@($;

029>+@(%;

\ \[

$''($;>+@

$'&(%;>+@

\ \[

$''($;>+@

$'&(%;>+@

,1&(';.HHSWUDFNRIWKHH[SRQHQW



-03$%&

7KH>UHJ@)RUPDW

/RQJVXFFHVVLRQVRIE\WHVRFFXULQERWKDUUD\VDQGLQYHU\ODUJHQXPEHUV7KH>UHJ@IRUPDWLVPXFKEHWWHU

VXLWHGWRGHDOZLWKWKHVHVLWXDWLRQVWKDQLVWKH>LPP@IRUPDW8VLQJ

029

WRLOOXVWUDWHWKH>UHJ@IRUPDWZHKDYH

ERWK

029UHJ>UHJ@

DQG

029>UHJ@UHJ

,QWKHILUVWRIWKHVHWKH>UHJ@VRXUFHRSHUDQGUHIHUVWRWKHORFDWLRQLQPHPRU\ZKRVHDGGUHVVLVLQWKH

UHJLVWHUZKRVHQDPHLVLQEUDFNHWV)RUH[DPSOHWKHFRGH

029(%;+

029($;>(%;@

WUDQVIHUVIRXUE\WHVLQWRWKH($;UHJLVWHUIURPPHPRU\VWDUWLQJDWDGGUHVV+

$VDQH[DPSOHRIWKHXVHIXOQHVVRIWKH>UHJ@IRUPDWVXSSRVHZHFRQVLGHUWKHSUREOHPRIDGGLQJWZR

E\WHQXPEHUV

,Q

3URJUDP

WKHDGGUHVVHVZHUHDFFHVVHGGLUHFWO\XVLQJWKH>LPP@IRUPDW(DFKIRXUE\WHVRIWKHDGGLWLRQ

ZHUHGRQHXVLQJWZRLQVWUXFWLRQVD

029

DQGDQ

$'&

8VLQJWKDWVDPHWHFKQLTXHKHUHWRGRDGGE\WH

QXPEHUVZRXOGUHTXLUHPXOWLSO\LQJWKHQXPEHURILQVWUXFWLRQVQHHGHGE\&RQVHTXHQWO\ZHZRXOGQHHG

OLQHVRIFRGH,IZHXVHWKH>UHJ@IRUPDWRQWKHRWKHUKDQGZHPD\XVHDUHJLVWHUIRUWKHVRXUFHDQG

GHVWLQDWLRQDGGUHVVHVDQGLQFUHPHQWWKHPLQDORRS,IZHXVH(',IRUWKHGHVWLQDWLRQLQGH[DQG(6,IRUWKH

VRXUFHLQGH[WKHQZHEHJLQE\VWRULQJ+LQ(',DQG+LQ(6,:HPXVWWKHQLQFUHDVHWKHVHSRLQWHUV

IRXUE\WHVDWDWLPHDVZHWUDYHUVHWKHWZRELJQXPEHUV7KLVFRGHLVPXFKVKRUWHUWKDQWKH

3URJUDP



&RGHZKLFKDGGVWZRE\WHQXPEHUV\DQG[

\ \[



$VVXPHWKHE\WHVRI\DUHVWRUHGVWDUWLQJDWPHPRU\DGGUHVV+

$VVXPHWKHE\WHVRI[DUHVWRUHGVWDUWLQJDWPHPRU\DGGUHVV+

8VH(';WRVWRUHDGHFUHPHQWFRXQWHUIRUWKH\ \[ORRS



029(',+,QLWLDOL]HSRLQWHULQWR\

029(6,+,QLWLDOL]HSRLQWHULQWR[



\ \[

029(';+/RRSQHHGVLWHUDWLRQV

&/&&OHDUWKHFDUU\IODJ

;<=029($;>(6,@6RXUFHE\WHVLQWRWKH3URFHVVRU

$'&>(',@($;'RWKHDGGLWLRQ

,1&(6,

,1&(6,

,1&(6,7KLVLVXJO\

,1&(6,

,1&(',%XWXVLQJ$''KHUHZRXOG

,1&(',FOHDUWKHFDUU\IODJ

,1&(',

,1&(',

'(&(';'HFUHPHQWWKHORRSFRXQWHU

-1=;<=6HHLIWKHORRSLVILQLVKHG

OLQHVZKLFKZRXOGKDYHUHVXOWHGIURPXVLQJWKH>LPP@IRUPDW

$WILUVWVLJKWLWZRXOGDSSHDUWKDWZHFRXOGGREHWWHUE\XVLQJ

$''

LQVWUXFWLRQVLQSODFHRIPXOWLSOH

,1&

LQVWUXFWLRQV%XWWKLVZRXOGDFWXDOO\UXLQHYHU\WKLQJ%HFDXVHZHDUHXVLQJDORRSWRSURFHHGIRXUE\WHVDWD

WLPHIURPWKHOHDVWVLJQLILFDQWWRWKHPRVWVLJQLILFDQWE\WHVZHHQFRXQWHUDSUREOHPZLWKWKHFDUU\IODJ,ILQ

EHWZHHQWZRH[HFXWLRQVRIWKH

$'&

LQVWUXFWLRQZHPRYHIRXUE\WHVGRZQWKHQXPEHUXVLQJDQ

$''

LQVWUXFWLRQZHKDYHPHVVHGXSWKHFDUU\IODJ,Q

FKDSWHU

LWLVQRWHGWKDWWKHFDUU\IODJLVXQDIIHFWHGE\WKH

,1&

DQG

'(&

LQVWUXFWLRQV7KHUHDVRQIRUWKLVDUFDQHOLWWOHH[FHSWLRQVXGGHQO\EHFRPHVFOHDU0XOWLE\WH

DULWKPHWLFQHHGVDFDUU\IODJZKLFKFDQVXUYLYHORRSFRXQWHUDGMXVWPHQWV%HFDXVHWKH\GRQ WDIIHFWWKHFDUU\

IODJWKH

,1&

DQG

'(&

LQVWUXFWLRQVFDQEHXVHGWRFDUU\RXWKDUPOHVVORRSFRXQWHUDGMXVWPHQWV$GGLQJE\

XVLQJIRXU

,1&

LQVWUXFWLRQVLVQRWEHDXWLIXOEXWLWZRUNV

7KLVFRGHLVQRWEDGIURPWKHVWDQGSRLQWRIWDNLQJXSPHPRU\VSDFHVLQFHPHPRU\LVFKHDS%XWLWLVEDG

IURPWKHVWDQGSRLQWRIDGGLQJH[HFXWLRQWLPHWRDORRS,IWKHUHLVRQHSODFHZKHUHH[HFXWLRQWLPHLVFRVWO\LW

LVLQWKHPLGGOHRIDQHVWHGORRSDQGWKDWLVH[DFWO\ZKHUHWKRVHH[WUD

,1&

LQVWUXFWLRQVDUH

$QRWKHUPHPRU\IRUPDWLVXVHIXOLQGHDOLQJZLWKWKLVSUREOHP

7KH>UHJVFDOH UHJLPP@)RUPDW

7KHPRVWJHQHUDOPHPRU\IRUPDWLVWKH>UHJVFDOH UHJLPP@IRUPDWZKHUHVFDOHLVDVFDOHIDFWRUZKLFK

PXVWEHHLWKHURU7KHUHJLVWHUZKLFKLVPXOWLSOLHGE\WKHVFDOHIDFWRULVFDOOHGWKHLQGH[UHJLVWHU

7KHRWKHUUHJLVWHULVFDOOHGWKHEDVHUHJLVWHU6RPHILHOGVPD\EHRPLWWHG7KLVJLYHVXVWKHHIIHFWRID

YDULHW\RIIRUPDWVLQFOXGLQJ

LQDGGLWLRQWRWKH>UHJ@DQG>LPP@IRUPDWVDOUHDG\GLVFXVVHG,WLVDOLWWOHKDUGWREHOLHYHWKDWLQVWUXFWLRQV

ZLWKWKLVGHJUHHRIFRPSOH[LW\DUHKDUGFRGHGLQWRWKHSURFHVVRUV%XWWKHFRVWLQWHUPVRILQVWUXFWLRQOHQJWK

IRUDOOWKLVFRPSOH[LW\LVDFWXDOO\MXVWRQHPRUHE\WHRIFRGHIRULQVWUXFWLRQVZKLFKXWLOL]HWKLVJHQHUDO

IRUPDW7KHE\WHLVFDOOHGWKH6,%E\WHERWKIRUVFDOHGLQGH[EDVHE\WHDQGVLEOLQJRIWKH0RG50E\WH

7DNLQJXSWKHSUREOHPRIWKHUHSHDWHG

,1&

LQVWUXFWLRQLQ

3URJUDP

QRWHWKDWDVFDOHIDFWRURIZRXOG

LQFUHDVHWKHDGGUHVVE\ZKHQHYHUWKHLQGH[UHJLVWHUZDVLQFUHPHQWHGE\,QWKHFRGHVKRZQLQ

3URJUDP



WKH>VFDOH UHJLPP@IRUPDWLVXVHGWRUHIHUWRERWKVRXUFHDQGGHVWLQDWLRQPHPRU\ORFDWLRQV,QWKLV

FRGHZHVHHWKDWDVLQJOH

,1&

LQVWUXFWLRQWDNHVWKHSODFHRIHLJKW

,1&

LQVWUXFWLRQVLQ

3URJUDP



3URJUDP

(GOLQDVSURJUDPZKLFKILQGVE\WHSRZHUVRI

6WRUHWKHE\WHVRI[VWDUWLQJDWPHPRU\DGGUHVV+

6WRUHWKHE\WHVRI\VWDUWLQJDWPHPRU\DGGUHVV+

029(%;,QLWLDOL]HEDVH

029(';,QLWLDOL]HH[SRQHQW

\ 

029($;'RWKHDGGLQJLQ($;

029(',+/RRSQHHGVLWHUDWLRQV

=52'(&(',

029> (',+@($;

-1==52

029> (',+@(%;



[ \0DLQLQILQLWHORRSVWDUWVKHUH



/83029(',+/RRSQHHGVLWHUDWLRQV

029(6,(%;,QLWLDOL]HPDLQORRSFRXQWHU

%(*'(&(',

029($;> (',+@

029> (',+@($;

-1=%(*

\ \[

$*1029(&;+/RRSQHHGVLWHUDWLRQV

;<=029($;> (',+@

$'&($;> (',+@

029> (',+@($;

,1&(',

'(&(&;

-1=;<=



'(&(6,

-1=$*1



,1&(';

-03/83

2QHYDULDWLRQZKLFKLVQRWSHUPLWWHGLVWKHXVHRIPHPRU\UHIHUHQFHVLQERWKRSHUDQGSRVLWLRQV7KHUHDUH

QR[SURFHVVRULQVWUXFWLRQVZKLFKXVHPHPRU\DVERWKVRXUFHDQGGHVWLQDWLRQRSHUDQGV7KHLQVWUXFWLRQ

$''>($;@>(%;@

IRUH[DPSOHGRHVQRWH[LVW7KHUHDUHKRZHYHULQVWUXFWLRQVZKLFKLQYROYHERWKUHDGLQJIURPDQGZULWLQJWR

PHPRU\

,1&

>($;@IRUH[DPSOHERWKUHDGVIURPDQGZULWHVWRWKHPHPRU\ORFDWLRQZKRVHDGGUHVVLVLQ

($;$UFKLWHFWXUHVFDOOHGORDGVWRUHDUFKLWHFWXUHVGRQRWDOORZPL[LQJSURFHVVRURSHUDWLRQVZLWKPHPRU\

RSHUDWLRQV7KHRQO\FRPPDQGVLQDORDGVWRUHDUFKLWHFWXUHZKLFKDFFHVVPHPRU\DUHORDGDQGVWRUH

%LW$GGUHVVHV

,Q

VHFWLRQ

WKH>UHJ@IRUPDWIRUPHPRU\DGGUHVVLQJZDVSUHVHQWHGZKHUHUHJFRXOGEHDQ\RIWKHHLJKW

ELWJHQHUDOUHJLVWHUV7KHDQGDOVRXVHD>UHJ@IRUPDW1RWDOOHLJKWELWUHJLVWHUVDUH

SHUPLWWHGKRZHYHURQO\%3%;6,DQG',7KHUHLVDOVRD>UHJUHJLPP@IRUPLPPPXVWEHDELW

QXPEHU,IWZRUHJLVWHUVDUHXVHGWKHRQO\DOORZHGFRPELQDWLRQVDUH%36,%3',%;6,DQG%;

',6LQFHWKHVHUHVWULFWLRQVDUHHDV\WRIRUJHWSURJUDPPHUVQRWDFFXVWRPHGWRELWDGGUHVVHVPD\ILQG

WKHPVHOYHVXVLQJGLVDOORZHGIRUPVRIDGGUHVV0RVWSURJUDPPHUVZLOOSUHIHUWRDYRLGELWDGGUHVVLQJ

ZKHQHYHUSRVVLEOH

7KHVHELWIRUPVRIPHPRU\DGGUHVVFDQEHXVHGRQDQ:KHQWKH\RFFXULQELWFRGHDVSHFLDO

SUHIL[+KDVWREHDSSOLHGWRWKHPDFKLQHFRGHWRQRWLI\WKHSURFHVVRUWKDWWKHPHPRU\DGGUHVVELWVLQ

WKH0RG50E\WHDUHFRGHGXVLQJWKHROGELWFRGLQJV\VWHP7KLVSUHIL[LVFDOOHGWKHDGGUHVVVL]HSUHIL[

,WLVVLPLODUWRWKHRSHUDQGVL]HSUHIL[GLVFXVVHGLQ

FKDSWHU



VHFWLRQ



&,6&YV5,6&

$Q[FRPSXWHULVJHQHUDOO\FRQVLGHUHGWREHDFRPSOH[LQVWUXFWLRQVHWFRPSXWHU&,6&7KLVLVSDUWO\

EHFDXVHRIFRPSOLFDWHGDGGUHVVLQJDVLQWKH

>('; (6,$%&@

PHPRU\RSHUDQG0DFKLQHVVXFKDVWKH

681DQG0,36ZRUNVWDWLRQVDUHEDVHGRQWKHLGHDWKDWE\VLPSOLI\LQJWKHLQVWUXFWLRQVDQGKDYLQJIHZHURI

WKHPWKH\EHFRPHHDVLHUDQGIDVWHUWRH[HFXWH7KLVFDQPRUHWKDQPDNHXSIRUWKHIDFWWKDWLWWDNHVPRUHRI

WKHVHOLWWOHLQVWUXFWLRQVWRZULWHDSURJUDP&RPSXWLQJEDVHGRQWKLVSKLORVRSK\LVFDOOHG5,6&UHGXFHG

LQVWUXFWLRQVHWFRPSXWLQJ7KH5,6&YV&,6&LVVXHLVQRWDQHLWKHU±RULVVXHOLNHOLWWOHHQGLDQYVELJHQGLDQ

5,6&LVDVHWRIIHDWXUHVZKLFKPD\EHDGRSWHGSDUWLDOO\LQYDU\LQJGHJUHHV2QHUHDVRQWKDWWKHDQG

3HQWLXPSURFHVVRUVZHUHDEOHWRFRPSHWHZLWKWKHHDUO\5,6&3RZHU3&SURFHVVRUVLVWKDWWKH\DGRSWHGD

SLHFHPHDO5,6&SKLORVRSK\$OWKRXJK&,6&LQVWUXFWLRQVDUHDOORZHGRQD3HQWLXPLWZRUNVIDVWHULI

SURJUDPPHGXVLQJD5,6&OLNHVXEVHWRIWKHWRWDOLQVWUXFWLRQVHW

7KHLUQDPHVQRWZLWKVWDQGLQJWKH3HQWLXP,,DQG3HQWLXP3URKDYHJRQHRYHUWRDWRWDOO\5,6&DUFKLWHFWXUH

7KHLQVWUXFWLRQVHWXVHGLQWHUQDOO\LVDSXUH5,6&LQVWUXFWLRQVHW7UDGLWLRQDO[LQVWUXFWLRQVDUHFRQYHUWHG

LQWHUQDOO\WR5,6&LQVWUXFWLRQVEHIRUHWKH\DUHH[HFXWHG,QDVHQVHWKHHQGRIWKHOLQHWDJKXQJRQWKH

3HQWLXPE\$SSOHPDUNHWHUVZDVFRUUHFW%XWLURQLFDOO\DVVHPEO\ODQJXDJHLVQRZVWURQJHUWKDQHYHU

2SHUDQG6L]H$PELJXLW\

,QPRVWWZRRSHUDQGLQVWUXFWLRQVERWKRSHUDQGVPXVWKDYHWKHVDPHVL]H6RZKHQDPHPRU\RSHUDQGLV

XVHGLQVXFKDFRQWH[WWKHQXPEHURIE\WHVLWUHIHUVWRFDQEHGHWHUPLQHGLIWKHRWKHURSHUDQGLVDUHJLVWHU

RSHUDQG)RUH[DPSOHLQ

$''>(%;@$;

WKHPHPRU\RSHUDQG>(%;@PXVWUHIHUWRWZRE\WHVRIPHPRU\

VLQFH$;LVDWZRE\WHUHJLVWHU+RZHYHUZKHQDPHPRU\RSHUDQGLVXVHGZLWKDQLPPHGLDWHRSHUDQGWKH

UHVXOWLVDPELJXRXV)RUH[DPSOHWKHIROORZLQJFRPPDQGLVDPELJXRXV

029>(%;@

6LPLODUO\ZKHQDPHPRU\RSHUDQGLVXVHGZLWKDXQDU\RSHUDWLRQVXFKDV

1(*

ZKLFKWDNHVWKHWZR V

FRPSOHPHQWRIDQXPEHUWKHRSHUDQGVL]HLVLQGHWHUPLQDWH$QLQVWUXFWLRQVXFKDV

1(*>(%;@

PLJKWZHOOUHIHUWRRQHWZRRUIRXUE\WHVRIPHPRU\8QGHUWKHVHFLUFXPVWDQFHVDQDVVHPEOHUKDVWRPDNH

DFKRLFH1$60FKRRVHVWRSURGXFHDQHUURUPHVVDJH,QELWFRGH(GOLQDVGHIDXOWVWRDIRXUE\WH

UHIHUHQFHZKHQWKHUHIHUHQFHLVDPELJXRXV,QELWFRGHWKHGHIDXOWLVWZRE\WH7RLQGLFDWHWKHRQHE\WH

FDVHLQ(GOLQDV\RXPD\XVHWKHFXVWRPDU\EXWFOXPV\QRWDWLRQ

1(*%<7(375>(%;@

,Q1$60WKHFRGHLV

1(*%<7(>(%;@

7RLQGLFDWHDIRXUE\WHUHIHUHQFHLQ1$60WKHFRGHLV

1(*':25'>(%;@

$WZRE\WHUHIHUHQFHLVLQGLFDWHGXVLQJ

:25'

DVDTXDOLILHU7KHVHTXDOLILHUVFOHDUO\GRWKHMRE7KHLPSOLHG

FRQFHVVLRQWKDWDZRUGLVELWVLVXQIRUWXQDWH,QOLJKWRIQRWDWLRQVXFKDV

%<7(375

WKH$7 7SUDFWLFH

RIDGGLQJDOHWWHUWRWKHPQHPRQLFGRHVQ WVHHPVREDG,QIDFWWKH,QWHODVVHPEOHUGRHVXVHPQHPRQLFVRI

WKLVVRUWLQDIHZFDVHVVXFKDV

/2'6%

DQG

6726%

ORDGVWULQJE\WHDQGVWRUHVWULQJE\WH

/DEHOV

,QSURJUDPPLQJMXPSVODEHOVDUHXVHGDVDFRQYHQLHQFH8VLQJDODEHOZLWKDMXPSLQVWUXFWLRQPDNHVLW

XQQHFHVVDU\WRFRXQWWKHQXPEHURIE\WHVXSVWUHDPRUGRZQVWUHDPWRWKHMXPSWDUJHW&RXQWLQJWKHVHE\WHV

UHTXLUHVDVVHPEOLQJWKHLQWHUYHQLQJFRGHDQGKDVWREHGRQHRYHUDJDLQDQ\WLPHWKHLQWHUYHQLQJFRGHLV

FKDQJHG6RODEHOVDUHDJUHDWFRQYHQLHQFH%XWVWLOOWKH\DUHRQO\DFRQYHQLHQFH

/DEHOVPD\DOVREHXVHGLQDFFHVVLQJPHPRU\VWRUDJHORFDWLRQV,Q

3URJUDP

ZHVHH

$%&

XVHGDVWKHODEHO

IRUDORFDWLRQZKHUHDQLQSXWE\WHLVVWRUHG,QWKH

3URJUDP

7LQ\(GOLQDVSURJUDPZKLFKXVHVDODEHOWRUHIHUHQFHDGDWDVWRUDJHORFDWLRQ



,1$/>@(

029>$%&@$/





5(7&

$%&123

PDFKLQHFRGHIRUWKH

029>$%&@$/

LQVWUXFWLRQWKHODEHO

$%&

LVUHSODFHGE\DQXPEHU%DVHGRQWKH

HQFRGLQJRIMXPSLQVWUXFWLRQVGLVFXVVHGLQ

FKDSWHU

ZHVKRXOGH[SHFWWRVHH

$%&

UHSODFHGE\WKHQXPEHU

VLQFHWKHODEHO

$%&

RFFXUVRQHE\WHSDVWWKHEHJLQQLQJRIWKHQH[WLQVWUXFWLRQ%DVHGRQWKH

029

LQVWUXFWLRQV

LQ

VHFWLRQ

ZHVKRXOGH[SHFWWRVHH

$%&

UHSODFHGE\WKHDGGUHVVRIWKHLQVWUXFWLRQRQZKLFKWKHODEHO

$%&

RFFXUVLQWKLVFDVHLIZHDVVXPHWKDWLWLVORDGHGVWDUWLQJDWDVLWZRXOGEHE\(GOLQDV

$GGUHVV(QFRGLQJ

7KHUHDUHWZRFRPPRQPHWKRGVIRUHQFRGLQJWKHDGGUHVVRIVRPHWDUJHWHGPHPRU\ORFDWLRQ

z

5HODWLYH(QFRGLQJ7KHQXPHULFDOGLIIHUHQFHEHWZHHQWKHDGGUHVVRIWKHWDUJHWHGORFDWLRQDQGWKH

DGGUHVVRIWKHIROORZLQJLQVWUXFWLRQLVXVHGLQWKHPDFKLQHFRGH

z

$EVROXWH(QFRGLQJ7KHWDUJHWDGGUHVVLWVHOILVXVHGLQWKHPDFKLQHFRGH

$OOWKHMXPSLQVWUXFWLRQVGLVFXVVHGLQ

FKDSWHU

XVHUHODWLYHHQFRGLQJ$EVROXWHHQFRGLQJLVXVHGIRUMXPS

LQVWUXFWLRQVXVHGLQFRGHDQGDOVRLQVRFDOOHGIDUMXPSVLQ[PDFKLQHFRGH7KHH[LVWHQFHRIVRPH

DEVROXWHHQFRGLQJLVDOPRVWXQDYRLGDEOH7KHRQO\DOWHUQDWLYHZRXOGEHWRGHVLJQWKHSURFHVVRUWRWDNHRYHU

WKHMRERIPHPRU\DOORFDWLRQ

$OOPHPRU\DFFHVVLQJLQVWUXFWLRQVLQ[PDFKLQHFRGH

029$''

HWFXVHDEVROXWHHQFRGLQJ

3URJUDP/RDGLQJ

'RUPDQWSURJUDPVXVXDOO\UHVLGHRQWKHKDUGGLVNRUVRPHRWKHUVHFRQGDU\VWRUDJHGHYLFH7RH[HFXWHWKH\

QHHGWREHLQPHPRU\7RJHWDSURJUDPWRH[HFXWHWKHXVHUSDVVHVLWVILOHQDPHWRWKHRSHUDWLQJV\VWHPE\

W\SLQJLWRQWKHFRPPDQGOLQHIRUH[DPSOHWRH[HFYHLQWKHFDVHRI/LQX[H[HFYHQRWWKHXVHURUWKH

SURJUDPPHUGHFLGHVZKHUHLQPHPRU\WKHSURJUDPZLOOEHORDGHG6LQFHSURJUDPPHUVKDYHQRFRQWURORYHU

WKHORFDWLRQRIWKHLUSURJUDPVLQPHPRU\LWPDNHVXVLQJLQVWUXFWLRQVWKDWXVHDEVROXWHPHPRU\HQFRGLQJ

SUREOHPDWLFZKHQODEHOVDUHXVHGWRUHIHUWRPHPRU\,QIDFWLWPDNHVDVVHPEOLQJSURJUDPVXVLQJPHPRU\

ODEHOVLQWRSODLQXQDLGHGPDFKLQHFRGHLPSRVVLEOH([HFXWDEOHFRGHUHVXOWLQJIURPSURJUDPVXVLQJPHPRU\

ODEHOVPXVWEHDFFRPSDQLHGE\WDEOHVLGHQWLI\LQJDOOWKHSRLQWVLQWKHFRGHZKHUHDQDEVROXWHDGGUHVV

RFFXUV7KHVHWDEOHVDUHFDOOHGUHORFDWLRQWDEOHV$OOREMHFWFRGHILOHV

R

ILOHVLQ/LQX[FRQWDLQUHORFDWLRQ

WDEOHV:KHQDSURJUDPLVORDGHGLQWRPHPRU\WKHVHWDEOHVDUHXVHGWRIL[HDFKDEVROXWHDGGUHVVLQWKH

PDFKLQHFRGHVRWKDWLWSRLQWVWRWKHDGGUHVVZKLFKLVYDOLGJLYHQZKHUHWKHSURJUDPLVDFWXDOO\ORDGHG

7KH(GOLQDVVLPXODWRUORDGVDOOSURJUDPVVWDUWLQJDWWKHDGGUHVV]HUR:HFDQFRXQWWKHE\WHVLQ

3URJUDP

IURPWKHUHWRWKHOLQHZLWK

$%&

RQLW,IZHGRZHILQGWKDWWKH

123

LQVWUXFWLRQRFFXUVDWDGGUHVV7KDWLV

ZK\WKHPDFKLQHFRGHJLYHQIRUWKH

029>$%&@$/

LQVWUXFWLRQLQ

3URJUDP

VKRZVWKHODEHO

$%&

HQFRGHG

DV7KHLQVWUXFWLRQ

029>@$/

FRXOGWKHUHIRUHEHXVHGLQSODFHRI

029>$%&@$/

,IWKLVSURJUDP

ZHUHWREHUHORFDWHGVRWKDWLWVWDUWHGDWWKHDGGUHVV+WKHQWKHFRGHIRUWKH

$%&

ODEHOLQWKH

029

LQVWUXFWLRQZRXOGQHHGWREH+LQVWHDGRI

9DULDEOHV

,QKLJKOHYHOSURJUDPPLQJODQJXDJHVYDULDEOHVDUHRIWHQLPSOHPHQWHGDVODEHOOHGPHPRU\ORFDWLRQV

$OWKRXJKDFRPSLOHUPD\XVHDUHJLVWHUDPRUHW\SLFDOLPSOHPHQWDWLRQRIDYDULDEOHLVDVDODEHOOHGPHPRU\

ORFDWLRQ7KLVLVWUXHSDUWLFXODUO\IRUJOREDOYDULDEOHV

$UUD\V

$VDQH[DPSOHRIKRZWKHVHDGGUHVVLQJPRGHVPLJKWEHXVHGWRKDQGOHDUUD\SURJUDPPLQJFRQVLGHUWKH

IROORZLQJ&FRGHZKLFKFRXQWVKRZPDQ\]HURVDQGRQHVWKHUHDUHLQWKHSDUWRIDQDUUD\[>@>@ZKHUH

WKHURZVRILQWHUHVWDUHIURPWKURXJKDQGWKHFROXPQVDUHIURPWKURXJK7RFRGHWKLVLQ

DVVHPEOHUZHFDQXVH(%;IRUQXPB]HURV(&;IRUQXPBRQHVDQGWKHODEHO

$%&

IRUWKHEHJLQQLQJRIWKH

DUUD\[7RUHIHUHQFHWKHDUUD\ORFDWLRQ[>L@>M@ZHQHHGWRXVHWKHIDFWWKDWWKHDGGUHVV [>L@>M@LVL  

M E\WHVSDVW [>@>@ $%&7KHLQL  FRPHVIURPWKHGHFODUDWLRQLQW[>@>@ZKLFKWHOOV

XVWKDWHYHU\URZFRQWDLQVIRXUE\WHORFDWLRQV$OWKRXJKZHPLJKWOLNHWRXVH(',IRULDQG(6,IRUM

DQGUHIHUHQFH[>L@>M@XVLQJ>$%& (', (6,@WKLVPXFKODWLWXGHGRHVQRWH[LVWLQWKHFRGLQJVSDFH

7KHPXOWLSOLHULVDOORZHGRQRQHUHJLVWHUEXWQHLWKHUDPXOWLSOLHURIQRUKDYLQJWZRVFDOHGUHJLVWHUVLV

DOORZHG+HQFHLWPDNHVVHQVHWRXVH(';IRU L>$%&('; (6,@

3URJUDP

QXPB]HURV 

QXPBRQHV 

IRUL LL L

IRUM MM M

^

LI[>L@>M@ 

QXPB]HURV QXPB]HURV

LI[>L@>M@ 

QXPBRQHV QXPBRQHV

`

,PPHGLDWH6WRUDJH

7KHMRERIDQDVVHPEOHULVWRSURGXFHREMHFWFRGHILOHV$QDVVHPEO\ODQJXDJHSURJUDPLVWKHLQSXWWRDQ

DVVHPEOHU([FHSWIRUFRPPHQWVDOOWKHOLQHVRIDOOWKHDVVHPEO\ODQJXDJHILOHVZHKDYHZRUNHGZLWKVRIDU

KDYHFRQVLVWHGRILQVWUXFWLRQVZKLFKDUHWUDQVODWHGLQWRSURFHVVRULQVWUXFWLRQVDVZDVGRQHLQ

FKDSWHU



$XWRPDWLFWUDQVODWLRQE\WKHDVVHPEOHULVDJUHDWFRQYHQLHQFHDQGLVPRVWO\ZKDWDVVHPEO\ODQJXDJHLVDOO

DERXW1RQHWKHOHVVLWLVVRPHWLPHVGHVLUDEOHWRIRUHJRWUDQVODWLRQDQGVSHFLI\REMHFWFRGHE\WHVGLUHFWO\

7ZRQRWDEOHRFFDVLRQVIRUWKLVDUH

z

'DWDE\WHVQHHGWREHLQVHUWHGGLUHFWO\

z

3URFHVVRULQVWUXFWLRQVQHHGWREHDVVHPEOHGE\KDQG

7KHIROORZLQJV\QWD[LVXVHGWRLQVHUWLPPHGLDWHO\JLYHQE\WHVGLUHFWO\LQWRWKHPDFKLQHFRGH

%\WH'HILQLWLRQ$VVHPEOHU'LUHFWLYH

,Q1$60WKHFRPPDQG

GELPP

VWRUHVDQ\RQHE\WHQXPEHULQWRWKHREMHFWFRGHILOH

GE

VWDQGVIRUGHILQHE\WH,QVWUXFWLRQVVXFKDV

GE

ZKLFK

GRQRWWUDQVODWHLQWRSURFHVVRULQVWUXFWLRQVDUHVRPHWLPHVFDOOHGSVHXGRLQVWUXFWLRQV6LQFHWKH\DUHDFWXDOO\

LQVWUXFWLRQVWRWKHDVVHPEOHULWLVEHWWHUWRFDOOWKHPDVVHPEOHUGLUHFWLYHV$VVHPEOHUGLUHFWLYHVW\SLFDOO\

ODFNWKHXQLYHUVDOLW\RISURFHVVRULQVWUXFWLRQVZKLFKXVXDOO\IROORZWKHIRUPDWODLGGRZQE\WKH

PDQXIDFWXUHU(GOLQDVIROORZVWKH8QL[WUDGLWLRQWKDWDOODVVHPEOHUGLUHFWLYHVEHJLQZLWKDGRWDQG

XVHV

GE

:LWKRXWWKHLQLWLDOGRWWKHGHILQHE\WHV\QWD[LVYHU\ZLGHVSUHDG:KHQXVHGZLWKODEHOVLWZRUNVLQERWK

0LFURVRIWDQG7XUERDVVHPEOHUV,QWKHVHDVVHPEOHUV

3URJUDP

029(%;QXPB]HURV

029(&;QXPBRQHV

029('; ,QLWLDOO\L 



2XWHUORRSEHJLQVKHUH



27/029(6,/HWM 



,QQHUORRSEHJLQVKHUH



,1/029($;>$%& (6,(';@

$%&  [>@>@

(';  [>L@>@ [>@>@

 M  [>L@>M@ [>L@>@

(6, M

&03($;&KHFNIRU]HURV

-1(12=

,1&(%;&RXQW]HURV

12=&03($;&KHFNIRURQHV

-1(122

,1&(&;&RXQWRQHV

122,1&(6,M MO

&03(6,&KHFNWKDWM

-/,1/,QQHUORRSHQGVKHUH

$''(';,QFUHDVH(';E\ 

&03(';  

-/27/2XWHUORRSHQGVKHUH

$%&123%HJLQDUUD\KHUH

WKHGHILQHE\WHGLUHFWLYHKDVWKHIODYRURIDGDWDW\SHGHFODUDWLRQ7KLVGDWDW\SHLVXVHGWRUHVROYH

DPELJXLWLHVRIWKHNLQGQRWHGLQ

VHFWLRQ

)RUH[DPSOHLIWKHODEHO

$%&

LVXVHGLQDSURJUDPZLWKWKHOLQH

$%&'%$%&LVRIW\SHE\WH

WKHQDFRPPDQGVXFKDV

1(*>$%&@

PHDQVWKHVDPHWKLQJDV

1(*%<7(375>$%&@

,Q1$60DQGLQ(GOLQDVSURJUDPVWKHUHLVQRW\SHVLJQLILFDQFHDWWDFKHGWR

GE

&RPPRQHPEHOOLVKPHQWV

RIWKHVLPSOHV\QWD[DOVRZRUNLQERWK

GELPPLPP

ZKHUHDVHTXHQFHRIRQHE\WHQXPEHUVIROORZVWKH

GE

VWRUHVDVHTHQFHRIE\WHVLQWRWKHREMHFWFRGHILOH

,Q(GOLQDVLWLVDOVRSRVVLEOHWRXVHDQLQWHJHUPXOWLSOLHURQWKHOHIW)RUH[DPSOHWKHIROORZLQJFRGHVWRUHV

]HURLQWRRQHKXQGUHGE\WHVRIPHPRU\

GE 

,Q1$60WKHVDPHHIIHFWFDQEHDFKLHYHGXVLQJWKHFRGH

7,0(6GE

+DQG&RGLQJRI,QVWUXFWLRQV

%HFDXVHDQHZSURFHVVRURIWHQXVHVDQLQVWUXFWLRQVHWZKLFKLVWKHVDPHDVDQROGLQVWUXFWLRQVHWH[FHSWIRU

RQHRUWZRQHZLQVWUXFWLRQVLWLVRIWHQZRUWKZKLOHWRXVHDQROGDVVHPEOHUWRSURJUDPDQHZSURFHVVRU1HZ

LQVWUXFWLRQVFDQEHXWLOL]HGE\KDQGFRGLQJWKHP2SHQVRXUFHDGYRFDWHVPD\ZHOOQRWHWKDWLIWKHDVVHPEOHU

ZHUHDQRSHQVRXUFHSURJUDPLWFRXOGVLPSO\EHUHSURJUDPPHGWRKDQGOHWKHQHZLQVWUXFWLRQ%XWWKDWLV

DQRWKHUTXHVWLRQ

3URJUDP

8VLQJLPPHGLDWHVWRUDJHWRHQFRGHWKH&38,'LQVWUXFWLRQ



029($;

GE)+$+,PPHGLDWHVWRUDJH

,QLWLDOL]LQJ'DWD

,Q&LWLVHDV\WRJHWWKHLPSUHVVLRQWKDWWKHUHLVQRGLIIHUHQFHEHWZHHQDGHFODUDWLRQZLWKDQLQLWLDOL]DWLRQ

VXFKDV

FKDU[ 

DQGDGHFODUDWLRQIROORZHGE\DQDVVLJQPHQWVXFKDV

FKDU[

[ 

,QIDFWKRZHYHUWKHUHLVDGLIIHUHQFH,QWKHVHFRQGFDVHWKHUHLVDQLPSOLHGSURFHVVRULQVWUXFWLRQZKLFK

VWRUHVWKHLPPHGLDWHYDOXH,QWKHILUVWFDVHKRZHYHUQRSURFHVVRULQVWUXFWLRQLVLPSOLHG7KHVWRUDJH

LQGLFDWHGPD\EHSHUIRUPHGE\VWRULQJWKHDWDSURJUDPLQWHUQDODGGUHVVE\WKHDVVHPEOHUEHIRUHWKH

SURJUDPLVHYHUORDGHG

3URJUDP

7LQ\(GOLQDVSURJUDPZKLFKXVHVDODEHOWRDFFHVVVWRUHGGDWD



029$/>$%&@

287>@$/

5(7

$%&GE

&KDSWHU7+(67$&.

7KHVWDFNLVDSRUWLRQRIPHPRU\ZKLFKLVVKDUHGZLWKWKHRSHUDWLQJV\VWHP,WLVXVHGE\SURJUDPVIRU

FRPPXQLFDWLRQZLWKVXESURJUDPVIRUWHPSRUDU\VWRUDJHDQGZKHQPDNLQJV\VWHPFDOOV,WLVFDOOHGWKH

VWDFNEHFDXVHLWKDVDODVWVWRUHGILUVWUHWULHYHGSROLF\,WLVLQIDFWDQH[DPSOHRIWKHGDWDVWUXFWXUHWKDWLV

FDOOHGDVWDFN%HFDXVHLWLVXVHGE\WKHRSHUDWLQJV\VWHPDVZHOODVE\WKHSURJUDPPHULWPXVWEHXVHG

UHVSRQVLEO\0LVXVLQJWKHVWDFNLVDYHU\HDV\ZD\WRFUDVKDSURJUDPRUWKHZKROHV\VWHPLIWKHRSHUDWLQJ

V\VWHPLVXQSURWHFWHG

3XVKDQG3RS2SHUDWLRQV

7KHIROORZLQJILJXUHVKRZVWKHVWDFNDQGWKH(63UHJLVWHU7KLVUHJLVWHUKDVWKHMRERINHHSLQJWUDFNRIWKH

VWDFN,WGRHVWKLVE\KROGLQJWKHDGGUHVVRIWKHWRSRIWKHVWDFN7KH63LQ(63VWDQGVIRUVWDFNSRLQWHU

$OWKRXJKWKH(63LVFDOOHGDJHQHUDOUHJLVWHUEHFDXVHLWLVDFFHVVLEOHWRWKHSURJUDPPHUOLNHWKHUHJLVWHUV

($;(%;HWFZULWHVWR(63VKRXOGEHGRQHRQO\ZLWKJUHDWFDUH

6XSSRVHWKDW(63FRQWDLQHGWKHDGGUHVV+DVLQ

)LJXUH

7KHQVWRULQJWKHE\WH+RQWKHVWDFNZRXOG

ILOOWKHORFDWLRQ+DQGWKHVWDFNSRLQWHUZRXOGEHFKDQJHGDVVKRZQLQ

)LJXUH

7KLVNLQGRIRSHUDWLRQ

LVFDOOHGDSXVK7KHRQHE\WHSXVKVKRZQKHUHLVHVVHQWLDOO\WKHVDPHDVWKHIROORZLQJWZRRSHUDWLRQV

)LJXUH%HIRUH3XVK

)LJXUH$IWHU3XVK

'(&(630RYHWKHSRLQWHUWRWKHILUVWYDFDQF\

029>(63@+6WRUH+DWWKHDGGUHVVLQ(63

,QIDFWWKH[GRHVQRWDOORZRQHE\WHSXVKHV$OOSXVKHVPXVWEHHLWKHUWZRE\WHRUIRXUE\WHSXVKHV7KH

QXPEHURIE\WHVSXVKHGLVGHWHUPLQHGE\WKHVL]HRIWKHRSHUDQGRQWKH

386+

LQVWUXFWLRQ

7KH

386+

&RPPDQG

7KHPRVWFRPPRQIRUPRIWKH386+LQVWUXFWLRQLV

386+UHJ

$OORZDEOHUHJLVWHUVLQFOXGHWKHDQGELWJHQHUDOUHJLVWHUVEXWQRWWKHHLJKWELWUHJLVWHUV0HPRU\DQG

LPPHGLDWHRSHUDQGVFDQDOVREHXVHGZLWK

386+

EXWWKHUHJLVWHURSHUDQGIRUPLVWKHPRVWXVHIXO

)LJXUH

DQG

)LJXUH

VKRZWKHHIIHFWRID

386+($;

LQVWUXFWLRQ

)LJXUH%HIRUH

386+($;

)LJXUH$IWHU

386+($;

LVYHU\VLPLODUWR

68%(63

029>(63@($;

%HFDXVHWKHVWDFNSRLQWHUSRLQWVWRWKHODVWRFFXSLHGORFDWLRQUDWKHUWKDQWKHILUVWXQRFFXSLHGORFDWLRQRIWKH

VWDFND

386+

PXVWEHFDUULHGRXWE\VXEWUDFWLQJIURPWKHVWDFNSRLQWHUILUVWDQGWKHQWUDQVIHUULQJWKHE\WHVWR

WKHVWDFNUDWKHUWKDQWKHRWKHUZD\DURXQG+DYLQJWKHVWDFNSRLQWHUSRLQWWRWKHILUVWDYDLODEOHORFDWLRQ

ZRXOGEHDUHDVRQDEOHSROLF\LIDOOSXVKHVDQGSRSVZHUHWKHVDPHVL]H%XWVLQFHSXVKHVDQGSRSVPD\EH

HLWKHUWZRRUIRXUE\WHVWKLVLVQRWDWHQDEOHSROLF\

7KH

323

&RPPDQG

7KHRSSRVLWHRSHUDWLRQLVFDOOHGDSRS/LNHWKH

386+

LQVWUXFWLRQ

323

WDNHVUHJLVWHUDQGPHPRU\RSHUDQGV

ZKLFKPD\EHHLWKHUWZRRUIRXUE\WHV8QOLNH

386+

LWGRHVQRWWDNHLPPHGLDWHRSHUDQGV$VZLWKSXVKHV

WKHVL]HRIWKHRSHUDQGGHWHUPLQHVWKHQXPEHURIE\WHVWREHSRSSHG6LQFH%;LVDWZRE\WHUHJLVWHU

323

%;

SRSVWZRE\WHVRIIWKHVWDFN

323%;

LVYHU\VLPLODUWR

029%;>(63@

$''(63

2QHXVHIRUWKHVWDFNLVVLPSO\IRUVWRUDJHZKHQWKHUHDUHQRWHQRXJKUHJLVWHUVDYDLODEOH6XSSRVHWKHUHDUH

YDOXHVLQ($;DQG(%;ZKLFKDUHLPSRUWDQWDQGQHHGWREHVDYHGEXWWKDWDOVRDFRPSXWDWLRQKDVWREH

GRQHZKLFKXVHVWKHUHJLVWHUV($;DQG(%;7KLVLVDVLWXDWLRQZKLFKFDOOVIRUXVLQJWKHVWDFN%HIRUHWKH

FRPSXWDWLRQLVGRQHWKHYDOXHVLQWKHUHJLVWHUV($;DQG(%;PD\EHVDYHGRQWKHVWDFN$IWHUWKH

FRPSXWDWLRQLVILQLVKHGWKH\PD\EHUHVWRUHGDJDLQ7KHIROORZLQJFRGHGRHVWKLV

386+($;

386+(%;



&RPSXWDWLRQ



323(%;

323($;

7KHRUGHURIWKHSRSVLVWKHH[DFWUHYHUVHRIWKHRUGHURIWKHSXVKHV7KLVLVEHFDXVHRIWKHODVWVWRUHGILUVW

UHWULHYHGFKDUDFWHURIDVWDFN7KHYDOXHVLQ($;DQG(%;DWWKHHQGVKRXOGEHWKHVDPHDVDWWKH

EHJLQQLQJ%XWWKLVZLOORQO\EHWUXHLIWKHLQWHUYHQLQJFRPSXWDWLRQXVHVWKHVWDFNUHVSRQVLEO\7KLVPHDQV

WKDWHDFKSXVKVKRXOGEHPDWFKHGZLWKDSRS,ISXVKHVDQGSRSVDUHQRWEDODQFHGWKHQWKHYDOXHVSRSSHG

LQWR(%;DQG($;DWWKHHQGRIFRPSXWDWLRQZLOOQRWEHWKHVDPHDVWKHLURULJLQDOYDOXHV

:KHQZULWLQJDXVHUSURJUDPWREHUXQLQ8QL[LWLVQRWQHFHVVDU\WRLQLWLDOL]HWKHVWDFNE\VWRULQJDYDOXHLQ

(63,QIDFWVLQFHWKHVWDFNLVDOUHDG\VHWXSVWRULQJDQDUELWUDU\YDOXHLQ(63ZRXOGGLVUXSWWKHH[LVWLQJ

VWDFNDQGFUDVKWKHSURJUDP:KHQZULWLQJDSURJUDPWRUXQLQ(GOLQDVKRZHYHULWLVQHFHVVDU\WRLQLWLDOL]H

(63

6XESURJUDPV

+LJKOHYHOSURJUDPPLQJODQJXDJHVXVHVXESURJUDPVLQRUGHUWRUHGXFHFRPSOH[WDVNVWRVLPSOHU

FRPSRQHQWV,Q&VXESURJUDPVDUHIXQFWLRQV$IXQFWLRQPD\EHFDOOHGDVWKRXJKLWZHUHDQRWKHU&

LQVWUXFWLRQ,IWKHIXQFWLRQ

VXESU

KDVEHHQGHILQHGWKHQLWPD\DSSHDULQDOLQHRIDPDLQSURJUDPDVLQ

3URJUDP



3URJUDP

PDLQ

^

LQW[\]



VXESU7KLVVXESURJUDPLVGHILQHGVHSDUDWHO\



`

7KH

&$//

DQG

5(7

&RPPDQGV

&RGLQJDQDVVHPEOHUSURJUDPZKLFKKDVDVXESURJUDPLVGRQHXVLQJWKH

&$//

DQG

5(7

LQVWUXFWLRQV

5(7

VWDQGVIRUUHWXUQ7KHVHFRPPDQGVZRUNOLNHMXPSWRDQGMXPSEDFNFRPPDQGV7KHIRUPDWRIWKH

&$//

LQVWUXFWLRQLVYHU\VLPLODUWRWKHIRUPDWRIWKH

-03

LQVWUXFWLRQ

3URJUDP

VXESU

^

LQWDEF



UHWXUQF

`

&$//ODEHO

$VZLWKWKH

-03

LQVWUXFWLRQWKHODEHOLVFUHDWHGE\WKHSURJUDPPHUDQGUHIHUVWRWKHOLQHZKRVHODEHOILHOGLW

RFFXSLHV

:KHQWKHVXESURJUDPLVGRQHFRQWUROQHHGVWREHWUDQVIHUUHGEDFNWRWKHPDLQSURJUDPLQSDUWLFXODUWKH

QH[WLQVWUXFWLRQH[HFXWHGLQWKHPDLQSURJUDPQHHGVWREHWKHLQVWUXFWLRQIROORZLQJWKH

&$//

LQVWUXFWLRQ7R

PDNHWKLVSRVVLEOHWKHSURFHVVRUSXVKHVWKHDGGUHVVRIWKHQH[WLQVWUXFWLRQRQWRWKHVWDFNEHIRUHLWOHDYHVWKH

PDLQSURJUDP

&$//

GRHVWKLV7KH

5(7

LQVWUXFWLRQSRSVWKLVDGGUHVVRIIWKHVWDFNDQGMXPSVWRLW

)RUH[DPSOH

3URJUDP

LVDSURJUDPWKDWDFFHSWVDXVHULQSXWXVHVDVXESURJUDPZKLFKDGGVWRWKH

(%;UHJLVWHUWRLQFUHPHQWWKHQXPEHUDQGWKHQRXWSXWVWKHUHVXOWEDFNWRWKHXVHU

3URJUDP



029(63+LQLWLDOL]HWKHVWDFN



(GOLQDVSURJUDPVPXVWLQLWLDOL]HWKHVWDFN

8QL[SURJUDPVPXVWQRW



,1($;>@*HWDXVHULQSXW

029(%;($;(%;LVZKHUHWKHVXEURXWLQHZRUNV

&$//VXESU/HDYHIRUWKHVXEURXWLQH

029($;(%;%DFNQRZIURPWKHVXEURXWLQH

287>@($;2XWSXWWKHLQFUHPHQWHGYDOXH

5(7*REDFNWR(GOLQDV



VXESU

,1&(%;6XESURJUDPGRHVLWVMRE

5(7*REDFNWRWKHPDLQSURJUDP

)RUDPRUHLQYROYHGH[DPSOHFRQVLGHUWKHIROORZLQJDOJRULWKP7KLVDOJRULWKPLVDWWKHKHDUWRIDZHOO

NQRZQXQVROYHGPDWKHPDWLFVSUREOHPFDOOHGWKH&ROODW]3UREOHP

,I[LVHYHQGLYLGHLWE\

,I[LVRGGPXOWLSO\LWE\DQGDGGWRLW

5HSHDWWKLVSURFHVVXQWLO[ 

6XSSRVHZHZDQWDSURJUDPZKLFKH[HFXWHVWKLVDOJRULWKPDQGFRXQWVKRZPDQ\VWHSVDUHUHTXLUHGXQWLOWKH

YDOXHRI[EHFRPHV

6LQFHLWUHTXLUHVDORRSWRGHWHUPLQHZKHWKHUDQXPEHULVHYHQRURGGRUWRGLYLGHLWE\LIZHDUHXVLQJ

RQO\DGGVXEWUDFWDQGFRQGLWLRQDOMXPSFRPPDQGVLWPDNHVVHQVHWRGHYLVHDVXESURJUDPWRGRWKLV

6SHFLILFDOO\VXSSRVHZHDVVLJQWKHVXESURJUDPWKHWDVNRIH[DPLQLQJWKH($;UHJLVWHUDQGVWRULQJKDOIRI

($;LQ(%;LI($;LVHYHQDQG]HURLQ(%;RWKHUZLVH:HPD\FRGHWKLVVXESURJUDPDVIROORZV

3URJUDP

+$)029(&;($;

029(%;

$*1,1&(%;&RXQWWKHVXEWUDFWLRQV

68%(&;5HSHDWHGO\VXEWUDFW

-*$*1

-='81,WFRPHVRXWHYHQ

029(%;,W VQRWHYHQ

'815(7

:LWKWKLVVXESURJUDPZHPD\QRZZULWHDPDLQSURJUDPZKLFKH[HFXWHV

3URJUDP



3DUDPHWHU3DVVLQJ

2QHRIWKHPRVWLPSRUWDQWIXQFWLRQVRIWKHVWDFNLVWKDWLWLVXVHGIRUSDUDPHWHUSDVVLQJ)RUH[DPSOH

VXSSRVHWKHFKDUDFWHUFRGHFRQYHUWLQJIXQFWLRQ

WRORZHU

LVFDOOHGLQD&SURJUDP

7KH

WRORZHU

IXQFWLRQLQWKHVWDQGDUG&OLEUDU\FW\SHKFRQYHUWVWKHFKDUDFWHUFRGHVWRORZHUFDVH)RU

H[DPSOHRQDPDFKLQHXVLQJ$6&,,FRGHLWZLOOUHWXUQWKH$6&,,FRGHIRU D LIJLYHQWKH$6&,,

FRGHIRU $ DVDQLQSXWSDUDPHWHU7KHLQSXWSDUDPHWHULVSXVKHGRQWRWKHVWDFN6RWKHDVVHPEOHUFRGHIRU

WKHVDPHIXQFWLRQFDOOORRNVOLNHWKLV

3URJUDP

029(%;

386+(%;

029(';

,1($;>';@

$%&&03($;

-(),1,I($; WKHQLW VRYHU

,1&(';8VH(';DVWKHFRXQWHU

&$//+$)7KLVLVWKHVXEURXWLQHFDOO

&03(%;(%; PHDQV($;LVRGG

-(2''

029($;(%;,IQRWWKHQ(%;LVKDOIRI($;

-03$%&

2''029(%;($;7ULSOH($;DQGDGG

$''($;(%;

$''($;(%;

,1&($;

-03$%&

),1029($;(';(';FRQWDLQVWKHILQDOFRXQW

029(';

287>';@($;

5(7

3URJUDP

LQFOXGHFW\SHK!

PDLQ

^

LQW[\

[  [  $  

\ WRORZHU[ \  D  

`

&$//WRORZHU

$''(63

$OWKRXJKLWPLJKWVHHPOLNHDQDWXUDOLGHDWRXVHWKHVWDFNIRUWKHUHWXUQYDOXHLWLVPRUHFRPPRQWRXVHD

UHJLVWHU,QJQX&IRUWKH[UHWXUQHGLQWHJHUYDOXHVDUHVWRUHGLQWKH($;UHJLVWHU/DQJXDJHVGLIIHUDVWR

ZKHWKHUWKHVXESURJUDPRUWKHPDLQSURJUDPLVUHVSRQVLEOHIRUSRSSLQJWKHSDUDPHWHUVRIIWKHVWDFN,Q

)RUWUDQ%DVLFDQG3DVFDOWKHVXESURJUDPSRSVWKHVWDFNEXWLQ&WKHFDOOLQJSURJUDPGRHV7KLVLVWKH

UHDVRQIRUWKH

$''(63

LQVWUXFWLRQLQWKHFDOOLQJSURJUDPVMXVWVKRZQ

/DQJXDJHVDOVRGLIIHULQWKHRUGHULQZKLFKSDUDPHWHUVDUHSXVKHGRQWRWKHVWDFN&SXVKHVSDUDPHWHUV

VWDUWLQJIURPWKHULJKW6XSSRVHZHKDYHGHILQHGDQLQWHJHUSRZHUIXQFWLRQ

LSRZ

LQWLSRZLQWEDVHLQWH[SRQHQW

7KHDVVHPEOHUFRGHWRFDOOWKLVIXQFWLRQWRFDOFXODWH



ORRNVOLNHWKLV

029(%;

386+(%;

029(%;

386+(%;

&$//LSRZ

$''(63

$IWHUWKLVFDOOWKHUHVXOW

LSRZ

 ZLOOEHVWRUHGLQWKH($;UHJLVWHU

7KH*OREDO$VVHPEOHU'LUHFWLYH

,QWKH

R

ILOHVSURGXFHGE\WKHJQXFRPSLOHUV\PEROVVXFKDV

SULQWI

RU

WRORZHU

ZKLFKQHHGH[WHUQDO

OLQNDJHDUHFRGHGGLIIHUHQWO\LQWKHV\PEROWDEOHV:LWKRXWWKLVVSHFLDOFRGLQJWKHJQXOLQNHUZLOOSDVVWKHP

E\DQGOLQNDJHZLOOIDLO,QRUGHUWRUHFHLYHWKLVVSHFLDOHQFRGLQJWKHDVVHPEO\ODQJXDJHVRXUFHFRGHPXVW

VSHFLDOO\LQGLFDWHV\PEROVZKLFKDUHWRUHFHLYHWKLVWUHDWPHQW7KHUHLVDQDVVHPEOHUGLUHFWLYHUHFRJQL]HGE\

WKHJQXDVVHPEOHUDQGE\(GOLQDVZKLFKZLOOFDXVHWKHDVVHPEOHUWRHQFRGHDV\PEROLQWKHV\PEROWDEOHDV

DYDLODEOHIRUOLQNDJH,W VV\QWD[LV

JOREOV\PERO

,Q1$60WKHV\QWD[LV

JOREDOV\PERO

&DOOLQJ$VVHPEOHUIURP&

7KH

+$)

VXESURJUDPZRXOGQRWZRUNLIFDOOHGIURP&EHFDXVHLWGRHVQRWUHWXUQYDOXHVLQWKH($;UHJLVWHU

$OVRLWGRHVQRWSXVKWKHUHJLVWHUVLWXVHV,QWKHFRGHEHORZ(&;LVSXVKHGEHFDXVHLWLVXVHGDQGWKH

FDOOLQJSURJUDPFRXOGEHXVLQJLWIRUVRPHWKLQJHOVH:HDOVRQHHGWRPDNHWKHIXQFWLRQQDPHYLVLEOHXVLQJ

WKH

JOREDO

GLUHFWLYH

:HKDYHMXVWZULWWHQDIXQFWLRQLQDVVHPEOHUZKLFKZHFDQFDOOIURPD&SURJUDP7KH&SURJUDPZLOOVWRUH

WKHFDOOLQJSDUDPHWHURQWKHVWDFN,WZLOOEHEXULHGXQGHUWKHUHWXUQDGGUHVVSXVKHGE\WKHFDOOLQJSURJUDP

DQGWKHFRQWHQWVRI(&;ZKLFKZHUHMXVWSXVKHG7KHVHWZRLWHPVRFFXS\HLJKWE\WHVRQWKHVWDFNVRWKH

FDOOLQJSDUDPHWHULVDFFHVVHGDWWKHDGGUHVV(637KHUHVXOWLVVWRUHGLQ($;LQVWHDGRI(%;7RVDYH

WKHREMHFWFRGHDVD

R

ILOHZKLOHLQ(GOLQDVXVHWKHRNH\7RSURGXFHDQREMHFWFRGHILOHXVLQJ1$60

HQWHU

3URJUDP

JOREDOKDOIRUJOREOLQ(GOLQDV

KDOI386+(&;(&;LVXVHGVRSXVKLW

029(&;>(63@

6WDFNWRSLQWHJHUV

029($;

$*1,1&($;&RXQWWKHVXEWUDFWLRQV

68%(&;5HSHDWHGO\VXEWUDFW

-*$*1

-='81,WFRPHVRXWHYHQ

029($;,W VQRWHYHQ

'81323(&;

5(7

OLQX[ER[QDVPIHOIKDOIDVP

7KH

IHOI

VZLWFKVSHFLILHVWKHIRUPDWRIWKHREMHFWFRGHILOHZKLFKLQFXUUHQW/LQX[LVHOI7KLVIRUPDWLV

GLVFXVVHGIXUWKHULQ

FKDSWHU



3URJUDP

LVD&SURJUDPZKLFKFDOOVWKHIXQFWLRQ

KDOI

ZKRVHDVVHPEO\FRGHLVVKRZQLQ

3URJUDP



,I

3URJUDP

LVVDYHGLQDILOH

FROODW]F

WKHQWRFRPSLOHLWDQGOLQNLWZLWK

KDOI

XVH

JFF

RQERWK

ILOHV

OLQX[ER[JFFFROODW]FKDOIR

5HFXUVLRQ

,QUHFXUVLRQPXFKRIWKHZRUNRIFRPSXWDWLRQLVGRQHE\WKHSDUDPHWHUSDVVLQJPHFKDQLVP

$UHFXUVLYHGHILQLWLRQFDQYHU\RIWHQEHHDVLO\WXUQHGLQWRDFRPSXWDWLRQDOO\HIIHFWLYHLIQRWHIILFLHQW

SURJUDP7KLVLVW\SLFDOO\LOOXVWUDWHGXVLQJWKH)LERQDFFLQXPEHUV

3URJUDP

VKRZVKRZWKLVUHFXUVLYHGHILQLWLRQFDQEHWXUQHGLQWR&FRGH,QDVVHPEO\ODQJXDJHZHFDQ

FRGHWKLVHDVLO\SURYLGHGZHUHFDOOWKDWXVHGUHJLVWHUVRWKHUWKDQ($;PXVWEHSXVKHG

3URJUDP

VKRZV

KRZZHFDQJHWE\XVLQJRQO\(&;DQG($;7RWHVWWKLVSURJUDPIURP&RQHFDQXVHDVPDOOFDOOLQJ

SURJUDPVXFKDV

3URJUDP

7RWHVWDSURJUDPOLNHWKLVXVLQJ(GOLQDVLWLVDOVRQHFHVVDU\WRLQLWLDOL]HWKH

VWDFNDVLVVKRZQLQWKHILUVWOLQHRI

3URJUDP



3URJUDP

PDLQ

^

LQWFRXQW[\

FRXQW 

SULQWI(QWHUDQXPEHU

VFDQIG [

ZKLOH[ 

^

FRXQW FRXQW

\ KDOI[ 7KLVLVWKHVXEURXWLQHFDOO 

LI\ 

[ \

HOVH

[  [

SULQWI?Q[ G[

`

SULQWI?Q7KHUHZHUHGLWHUDWLRQV?Q?QFRXQW

`

3URJUDP

LQWILELQWN

^

LQWG

LIN

G 

HOVH

G ILENOILEN

UHWXUQG

`

3URJUDP

JOREDOILE

ILE386+(&;*LYHVXVDFFHVVWR(&;

029($;>(63@

$FFHVVSDUDPHWHU

&03($;LIN

-$((/6

029($;3XWWKHUHWXUQYDOXHLQ($;

-03'81

(/6'(&($;*HWN±

029(&;($;($;ZLOOEHRYHUZULWWHQ

386+($;3DVVN²DVSDUDPHWHU

&$//ILE*HWEDFNILEN±OLQ($;

$''(63*HWULGRISDUDPHWHU

'(&(&;*HWN±

386+(&;3DVVNDVSDUDPHWHU

029(&;($;3XWILEN±OLQWR(&;

&$//ILE*HWEDFNILEN±LQ($;

$''(63*HWULGRISDUDPHWHU

$''($;(&;$GGWKHWZRSDUWLDOUHVXOWV

323(&;5HVWRUHWKHRULJLQDOYDOXH

5(7

3URJUDP

PDLQ

^

LQW[\



SULQWI(QWHUDQXPEHU

VFDQIG [



\ ILE[



SULQWIG?Q\

`

&KDSWHU/,18;86(5352*5$06

$WWKHEHJLQQLQJRI

FKDSWHU

LWZDVQRWHGWKDWPHPRU\DGGUHVVHVXVHGLQ/LQX[XVHUSURJUDPVDUHQRWWUXH

PHPRU\DGGUHVVHV7KHPDLQUHDVRQIRUWKLVLVWKDW/LQX[QHHGVWRSUHYHQWWKHXVHUIURPKDYLQJGLUHFW

DFFHVVWRPHPRU\6HH

)LJXUH



)LJXUH3URWHFWHG2SHUDWLQJ6\VWHPVXFKDV/LQX[

/LQX[LVDPXOWLWDVNLQJV\VWHP$PXOWLWDVNLQJV\VWHPKDVPDQ\XVHUMREVDQGDQRSHUDWLQJV\VWHPZKLFK

DUHDOOUXQQLQJDWRQFH2QDPDFKLQHZKHUHDQ\MREFDQRYHUZULWHWKHPHPRU\EHORQJLQJWRDQRWKHUMRED

PXOWLWDVNLQJV\VWHPLVLPSRVVLEOH0XOWLWDVNLQJUHTXLUHVPHPRU\SURWHFWLRQ/LQX[XVHVSDJLQJWR

LPSOHPHQWDPHPRU\SURWHFWLRQV\VWHP

3DJLQJZDVRULJLQDOO\GHVLJQHGDVDV\VWHPIRUHFRQRPL]LQJRQPHPRU\/LQX[XVHVLWIRUWKLVSXUSRVHDV

ZHOODVIRUPHPRU\SURWHFWLRQ3DJLQJZRUNVE\LQWHUFHSWLQJHDFKPHPRU\DFFHVVHQFRXQWHUHGLQWKHXVHU V

PDFKLQHFRGH,QRWKHUZRUGVHYHU\PHPRU\UHIHUHQFHLQDXVHUSURJUDPLVWXUQHGLQWRDUHTXHVWIRU

PHPRU\DFFHVVZKLFKLVUHTXLUHGWRJRDFURVVWKHGHVNRIWKHSDJLQJV\VWHPIRUDSSURYDO7KLVPHDQVWKDW

SDJLQJJHWVFRQWURORYHUPHPRU\DFFHVV,QRUGHUIRUWKLVWRKDSSHQWKHSURFHVVRUKDVWRKDYHSDJLQJZLUHG

LQWRLW

1HLWKHUWKHQRUWKHSURFHVVRUVVXSSRUWSDJLQJ7KHILUVW,QWHOSURFHVVRUZLWKSDJLQJVXSSRUWLV

WKH

0XOWLWDVNLQJ

%HIRUHPXOWLWDVNLQJRSHUDWLQJV\VWHPVH[LVWHGFRPSXWHUSURJUDPVZHUHH[HFXWHGLQVHTXHQFHLHRQHDIWHU

WKHRWKHU1RSURJUDPZDVDEOHWREHJLQH[HFXWLQJXQWLOWKHSURJUDPDKHDGRILWZDVILQLVKHG2SHUDWLQJ

V\VWHPVZKLFKUDQSURJUDPVLQVHULHVOLNHWKLVZHUHFDOOHGEDWFKRSHUDWLQJV\VWHPV$PXOWLWDVNLQJV\VWHP

DOORZVSURJUDPVWRWDNHWXUQVXVLQJSURFHVVRUV$QRSHUDWLQJV\VWHPSURJUDPFDOOHGWKHVFKHGXOHUDFWVDVD

UHIHUHHDQGIRUFHVXVHUSURJUDPVWR\LHOGWRRQHDQRWKHUHYHQZKHQWKH\DUHQRWILQLVKHG$WDQ\JLYHQ

PRPHQWWKHUHPD\EHPDQ\XVHUSURJUDPVWDNLQJWXUQVDQGZDLWLQJIRUSURFHVVRUWLPH(DFKRIWKHVH

SURJUDPVLVFDOOHGDWDVNRUDSURFHVV$GLVWLQFWLRQKDVWREHPDGHEHWZHHQDSURJUDPDQGDSURFHVVVLQFH

RQHSURJUDPFDQEHFDOOHGVHYHUDOWLPHVE\VHYHUDOXVHUVDOODWRQFH(DFKVHSDUDWHLQVWDQFHRIDSURJUDPLV

DSURFHVV,Q/LQX[ZHFDQOLVWWKHSURFHVVHVE\XVLQJWKH

OLQX[ER[SVDX[

FRPPDQG2UWRFRQGXFWDPRUHGHWDLOHGH[DPLQDWLRQZHFDQH[SORUHWKH

SURF

GLUHFWRU\

$PXOWLWDVNLQJV\VWHPVXFKDV/LQX[LVFRQWLQXDOO\MXJJOLQJLWVSURFHVVRUUHVRXUFHVSDVVLQJWKHPIURP

SURFHVVWRSURFHVV(DFKWLPHDSURFHVVJHWVEXPSHGIURPDSURFHVVRULWKDVWRVDYHLWVFXUUHQWVWDWH3DUWRI

WKHZRUNRIVDYLQJLVGRQHE\DKDUGZLUHGURXWLQHZKLFKLVH[HFXWHGZKHQWKH[GRHVDWDVNVZLWFK,W

VDYHVDOOFXUUHQWUHJLVWHUVWRDUHJLRQLQPHPRU\FDOOHGWKHWDVNVWDWHVHJPHQW7KHWDVNVWDWHVHJPHQWKROGV

WKHIUR]HQVWDWHRIDWDVNZKLFKLVQRWFXUUHQWO\UXQQLQJ(YHU\WDVNKDVLWVRZQWDVNVWDWHVHJPHQW7KHVH

WDVNVWDWHVHJPHQWVPDNHLWSRVVLEOHWRVZLWFKIURPRQHWDVNWRDQRWKHU

)LJXUH

VKRZVWKHEDVLFOD\RXWRI

DWDVNVWDWHVHJPHQWLQFOXGLQJWKHVSDFHIRUDOOWKHJHQHUDOUHJLVWHUVDQGDUHJLVWHUFDOOHGWKH&5UHJLVWHU

6RPHVSDFHWKDWLVXQPDUNHGLQWKLVILJXUHLVGLVFXVVHGLQ

FKDSWHU



)LJXUH7DVN6WDWH6HJPHQW

3DJLQJ

$VGLVFXVVHGLQ

FKDSWHU



VHFWLRQ

[,2DGGUHVVHVGRQRWXQGHUJRSURFHVVLQJ,IWKH';UHJLVWHU

FRQWDLQVDQXPEHUVXFKDV)&+WKHQWKHH[HFXWLRQRIWKH

,1$/>';@

FRPPDQGFDXVHVWKHELWVRI';

WREHDSSOLHGGLUHFWO\WRWKHDGGUHVVEXV

)&+ 

6RRQWKHDGGUHVVEXVZHJHW

7KHWRSELWVDUHMXVW

0HPRU\DGGUHVVHVRQWKHRWKHUKDQGDUHQRWKDQGOHGLQVXFKDVWUDLJKWIRUZDUGIDVKLRQ$

029$/>)&+@

ZLOOQRWUHVXOWLQWKHVHVDPHELWVEHLQJSXPSHGRXWRQWRWKHDGGUHVVEXV0HPRU\DGGUHVVHVXQGHUJRDWZR

VWHSSURFHVV

 6HJPHQWDWLRQ

 3DJLQJ

2QO\DWWKHHQGRIWKLVSURFHVVDQGWKHQRQO\LIHYHU\WKLQJJRHVZHOOLVWKHUHDSK\VLFDODGGUHVVZKLFKFDQ

EHSXPSHGRXWRQWRWKHDGGUHVVEXV6LQFH/LQX[GRHVQRWXVHVHJPHQWDWLRQGLVFXVVLRQRILWLVGHIHUUHGWR

FKDSWHU



9LUWXDO0HPRU\

$OODGGUHVVHVOLHLQWKHWR*LJUDQJH$OWKRXJKLWZRXOGPDNHVHQVHWKDWGLIIHUHQWWDVNVEHUHTXLUHGWR

XVHGLIIHUHQWSDUWVRIWKH*LJVSDFH/LQX[GRHVQRWZRUNWKLVZD\/LQX[PD\DOORFDWHWKHVDPHDGGUHVVHV

WRGLIIHUHQWWDVNVDWWKHVDPHWLPH7KHVHDGGUHVVHVDUHQRWUHDO7KH\DUHFDOOHGYLUWXDODGGUHVVHV-XVWDVD

IUDXGXOHQWDFFRXQWDQWNHHSVWZRVHWVRIERRNVRQHIRUWKHDXGLWRUVDQGRQHIRUWKHWUXHVWDWHRIDIIDLUV

/LQX[PXVWNHHSDVHWRIYLUWXDODGGUHVVHVIRUHDFKWDVNSOXVRQHVHWRIUHDODGGUHVVHVIRUWKHDFWXDOSK\VLFDO

ORFDWLRQVRQGLVNDQGLQ5$0

)LJXUH[9LUWXDO0HPRU\6\VWHP

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

































7KHWUDQVODWLRQEHWZHHQWKHYLUWXDODGGUHVVHVDQGWKHUHDORQHVLVGRQHXVLQJH[WHQVLYHVHWVRIWDEOHVFDOOHG

SDJHWDEOHV(DFKSURFHVVKDVLWVRZQVHWRIWDEOHV

)LJXUH

VKRZVWKHVLWXDWLRQZKLFKUHVXOWV7KHUHDGHUZLOOQRWHWKDWPHPRU\KDVEHHQVHULRXVO\

RYHUERRNHG7KHUHDUHW\SLFDOO\PDQ\SURFHVVHVUXQQLQJ(DFKSURFHVVXVHVSRWHQWLDOO\*LJRIYLUWXDO

DGGUHVVVSDFH%XWWKHW\SLFDOFRPSXWHUKDVPXFKOHVV5$0WKDQZRXOGEHQHHGHGWRVXSSO\DOOSURFHVVHV

ZLWK*LJ$WILUVWVLJKWSDJLQJVHHPVWREHDYHU\EDGLGHD%XWLQIDFWLWHFRQRPL]HVJUHDWO\RQPHPRU\

XVDJHDQGLVRQHRIWKHUHDVRQVFRPSXWHUVDUHDEOHWRUXQELJSURJUDPVDVIDVWDVWKH\GR$LUOLQHVRYHUERRN

LQRUGHUWRNHHSWKHLUSODQHVRFFXSLHG7KHFRVWRIIUHHDLUOLQHWLFNHWVQRZDQGWKHQWREXPSHGSDVVHQJHUVLV

PRUHWKDQSDLGIRUE\NHHSLQJWKHVHDWVIXOO/LNHZLVHWKHRFFDVLRQDOSDJHIDXOWLVPRUHWKDQPDGHXSIRUE\

NHHSLQJPHPRU\EXV\

)LJXUH/LQX[9LUWXDO0HPRU\6\VWHP

3DJLQJZRUNVE\FRS\LQJWHPSRUDULO\LGOHSRUWLRQVRIPHPRU\RQWRGLVN$VVXJJHVWHGE\LWVQDPHLWZRUNV

LQXQLWVFDOOHGSDJHV

.3DJHV

2QDQ[PDFKLQHDSDJHLVE\WHV,QRUGHUWRVHWXSDSDJLQJV\VWHPIRXUDUHDVQHHGWREHGLYLGHG

XSLQWRSDJHV

 7KHDYDLODEOHSK\VLFDOPHPRU\LVEURNHQXSLQWRSDJHV6LQFH 



 . +HYHU\SDJH

VWDUWVDWDQDGGUHVVHQGLQJLQWKUHHKH[]HURV3DJHVLQSK\VLFDOPHPRU\DUHVRPHWLPHVFDOOHGSDJH

IUDPHV

 (DFKWDVN V*LJYLUWXDODGGUHVVVSDFHVLVDOVRGLYLGHGLQWRSDJHV*LJFRUUHVSRQGVWR0HJRI

SDJHV

$JDLQHYHU\SDJHVWDUWVDWDQDGGUHVVHQGLQJLQWKUHHKH[]HURV

 7KHSRUWLRQRIWKHKDUGGLVNXVHGIRUSDJLQJLVDOVRGLYLGHGLQWRSDJHV7KLVSRUWLRQLVRIWHQFDOOHGWKH

VZDSVSDFH6LQFHPRVWGLVNVDUHIRUPDWWHGLQWRE\WHVHFWRUVWKLVPHDQVWKHQXPEHURIVHFWRUV

DOORFDWHGWRWKHVZDSVSDFHPXVWEHDPXOWLSOHRIHLJKW î

 7KHSDJHWDEOHVXVHGWRWUDQVODWHYLUWXDODGGUHVVHVDUHWKHPVHOYHVVHWXSLQXQLWVRISDJHV7KHVHWDEOHV

DUHGHVFULEHGLQ

VHFWLRQ



1RWHWKDWSDJHVRIYLUWXDOPHPRU\SK\VLFDOPHPRU\DQGGLVNDOOKDYHWKHVDPHVL]H7KLVIDFLOLWDWHVGDWD

WUDQVIHUVLQSDJHVL]HTXDQWLWLHV

3DJLQJYV6ZDSSLQJ

7KHWHUPVZDSVSDFHLVXQIRUWXQDWHVLQFHVZDSSLQJWUDGLWLRQDOO\UHIHUVWRFRS\LQJHQWLUHSURFHVVHVWRDQG

IURPWKHGLVN:KHQGHPDQGIRUPHPRU\RQDPXOWLWDVNLQJV\VWHPH[FHHGVWKHDYDLODEOH5$0DYHU\

VLPSOHVROXWLRQWRWKLVSUREOHPLVWRMXVWFRS\VRPHSURFHVVRXWWRWKHGLVN7KDWLVZKDWVZDSSLQJGRHV

6ZDSSLQJGRHVQRWLQFUHDVHPHPRU\HIILFLHQF\,WMXVWSUHYHQWVPHPRU\IURPRYHUORDGLQJ,WFDQEHGRQH

E\WKHRSHUDWLQJV\VWHPRQLWVRZQ,WGRHVQRWUHTXLUHDQ\VSHFLDOKDUGZDUHVXSSRUW6ZDSSLQJZDV

FRPPRQLQ8QL[V\VWHPVEHIRUHSDJLQJZDVLQYHQWHG/LQX[GRHVQRWXVHVZDSSLQJDQGQHYHUKDV

$OWKRXJKVZDSSLQJVROYHVWKHSUREOHPRIPHPRU\XQDYDLODELOLW\LWGRHVQRWGRYHU\ZHOOLQWHUPVRI

PDNLQJPHPRU\XVDJHHIILFLHQW&RS\LQJZKROHSURFHVVHVLQWRDQGRXWRIPHPRU\WHQGVWRIUDJPHQW

PHPRU\MXVWDVFRS\LQJILOHVRQWRDQGRIIRIDGLVNWHQGVWRIUDJPHQWDGLVN)XUWKHUPRUHE\WUHDWLQJ

SURFHVVHVDVZKROHVLWPLVVHVRXWRQWKHSRVVLELOLW\WKDWE\NHHSLQJMXVWWKHPRVWLPSRUWDQWSDUWVRIHDFK

SURFHVVLQPHPRU\LWPD\EHSRVVLEOHWRUXQDOOWKHSURFHVVHVZLWKRXWPXFKRQJRLQJGLVNDFFHVV)DLOLQJ

WKLVLWPD\DWOHDVWEHSRVVLEOHWRJUHDWO\UHGXFHWKHIUDFWLRQRIWKHSURFHVVRU VWLPHZKLFKLVZDVWHGLQ

VHUYLFLQJPHPRU\IDXOWV

3DJH)DXOWV

8VLQJSDJLQJDOOWKHSURFHVVHVDUHUXQDVWKRXJKWKH\ZHUHDOOLQPHPRU\VLPXOWDQHRXVO\:KHQDPDFKLQH

LQVWUXFWLRQLVHQFRXQWHUHGZKLFKUHIHUVWRDPHPRU\ORFDWLRQDFWXDOO\RQGLVNWKLVLVFDOOHGDSDJHIDXOW

:KHQDSDJHIDXOWRFFXUVVRPHSDJHIUDPHLQ5$0KDVWREHFKRVHQVRWKDWWKHQHHGHGSDJHPD\EHORDGHG

LQWRLWIURPWKHGLVN,IQRSDJHIUDPHLVIUHHWKHQVRPHSDJHRIPHPRU\KDVWREHFKRVHQIRUWUDQVIHUWRWKH

GLVNVRDVWRIUHHXSDSDJHIUDPH7KLVPHPRU\SDJHLVFRSLHGWRWKHGLVNDQGWKHSDJHFRQWDLQLQJWKH

PLVVHGDGGUHVVLVFRSLHGLQWR5$07KHUHDUHPDQ\GLIIHUHQWDOJRULWKPVLQXVHZKLFKFKRRVHSDJHVWREH

H[SHOOHGIURPPHPRU\6XFKDOJRULWKPVDUHUHIHUUHGWRDVSDJLQJDOJRULWKPV0DQ\SDJLQJDOJRULWKPV

FKRRVHSDJHVIRUH[SXOVLRQRQWKHEDVLVRIXVDJH8QXVHGSDJHVJHWH[SHOOHG

.HUQHO$GGUHVVHV

$OWKRXJK/LQX[PD\DQGRIWHQGRHVDOORFDWHWKHVDPHYLUWXDODGGUHVVHVWRGLIIHUHQWWDVNVLWXVHVDVSHFLDO

VHWRIYLUWXDODGGUHVVHVIRUNHUQHOPHPRU\DQGWKHVHDUHQHYHUGXSOLFDWHG

z

.HUQHODGGUHVVHVOLHLQWKHUDQJHIURP&+WR))))))))+LHWR*LJ

z

8VHUDGGUHVVHVLQWKHUDQJHIURPWR%)))))))+LHWR*LJ

)LJXUH

LOOXVWUDWHVWKLVPHPRU\SROLF\IURPWKHVWDQGSRLQWRIDVLQJOHSURFHVV

)LJXUH

VKRZVLWIURP

WKHVWDQGSRLQWRIWKHHQWLUHV\VWHP8VHUYLUWXDODGGUHVVHVDUHDOORWWHGLQGLYLGXDOO\.HUQHODGGUHVVHVDUH

V\VWHPZLGH

)LJXUH6LQJOH3URFHVV9LHZRI0HPRU\

%HIRUHYHUVLRQRI/LQX[WKHVHSDUDWLRQRINHUQHODQGXVHUPHPRU\ZDVDFFRPSOLVKHGXVLQJWKH

VHJPHQWDWLRQSURFHVV/LQX[FXUUHQWO\PDNHVQRXVHRIVHJPHQWDWLRQ1RZWKHVHSDUDWLRQLVDFFRPSOLVKHG

VLPSO\DVDQDOORFDWLRQSROLF\7KLVLQFLGHQWDOO\PDNHV[/LQX[PRUHOLNH$OSKD/LQX[7KH$OSKD

DUFKLWHFWXUHKDVQRVHJPHQWDWLRQ6HJPHQWDWLRQLVGLVFXVVHGLQ

FKDSWHUV

DQG





.HUQHO3DJHV

7KH/LQX[SDJLQJDOJRULWKPQHYHUSDJHVNHUQHOPHPRU\RXWWRGLVN7KH/LQX[NHUQHOLVWKHUHIRUHDOZD\VLQ

5$0

7KLVLVRQHUHDVRQWKDWFRPSLOLQJ/LQX[VSHFLDOO\IRUHDFKPDFKLQHLVZRUWKZKLOH,IWKHNHUQHOLVFRPSLOHG

ZLWKFRGHZKLFKLVQ WQHHGHGVXFKDVGHYLFHGULYHUVIRUGHYLFHVWKHPDFKLQHGRHVQ WKDYH5$0ZLOOEH

SHUPDQHQWO\RFFXSLHGE\FRGHZKLFKLVQHYHUXVHG

,WLVDOVRWKHUHDVRQWKDWPDFKLQHVUHTXLUHDSSUR[LPDWHO\0HJRI5$0GHSHQGLQJRQWKH/LQX[YHUVLRQWR

UXQ/LQX[DWDOO

.HUQHO0RGXOHV

$OWKRXJKNHUQHOPHPRU\LVQHYHUWRXFKHGE\WKHSDJLQJV\VWHPLWKDVEHHQSRVVLEOHVLQFH/LQX[YHUVLRQ

WRDGGRUGHOHWHFKXQNVRINHUQHOPHPRU\SURYLGHGWKH\KDYHEHHQFRPSLOHGVHSDUDWHO\DVPRGXOHV7KH

FRPPDQGV

OLQX[ER[LQVPRGPRGXOH

IRULQVWDOOPRGXOHDQG

OLQX[ER[UPPRGPRGXOH

IRUUHPRYHPRGXOHGRFKDQJHWKHDPRXQWRI5$0RFFXSLHGE\WKHNHUQHO7RLQVSHFWPHPRU\WRILQGRXW

WKHDPRXQWRIPHPRU\DYDLODEOHWKH/LQX[FRPPDQG

OLQX[ER[IUHH

LVXVHIXO

$GGUHVV7UDQVODWLRQ

/LQX[XVHUPHPRU\DGGUHVVHVDUHYLUWXDODGGUHVVHVQRWDFWXDOSK\VLFDODGGUHVVHV/LQX[XVHVSDJLQJWR

WUDQVODWHYLUWXDODGGUHVVHVWR5$0DGGUHVVHV[SDJLQJREWDLQVLWVWUDQVODWLRQVIURPSDJHWDEOHVVHWXSE\

WKHRSHUDWLQJV\VWHP6LQFHWKHWUDQVODWLRQSURFHVVLVKDUGZLUHGLQWRWKHSURFHVVRU[SDJHWDEOHVPXVW

KDYHWKHWZRWLHUHGVWUXFWXUHVKRZQLQ

)LJXUH



)LJXUH[3DJH7DEOH6WUXFWXUH

7ZR7LHUHG[3DJH7DEOHV

(DFKWDEOHLQWKLVVWUXFWXUHKDVIRXUE\WHHQWULHV7KHVL]HRIHDFKWDEOHWKHUHIRUHLV.1RWHWKDWHDFK

WDEOHLVDOVRDSDJH

$SDJHWDEOHWDEOHOLVWVWKHORFDWLRQVRISDJHWDEOHV(DFKSDJHWDEOHOLVWVWKHORFDWLRQVRISDJHV

(DFKSDJHFRQWDLQVE\WHV7KHWRWDOPHPRU\UHIHUHQFHGE\DSDJHWDEOHWDEOHLVWKHUHIRUHî
î 



î



î



 



 *LJDE\WHV7KLVLVWKHVL]HRIRQHYLUWXDODGGUHVVVSDFH

$GGUHVV3DUVLQJ

$OOYLUWXDODGGUHVVHVDUHELWTXDQWLWLHV7KHVHELWVDUHEURNHQXSDVIROORZV

7KHVHELWVDUHDOORFDWHGDVVKRZQLQ

)LJXUH

7KHWZRWHQELWQXPEHUVDUHLQGLFHVLQWRWDEOHVZLWK 





HQWULHV$WHQELWQXPEHULVDQXPEHUIURPWR7KHELWQXPEHULVDQLQGH[LQWRDSDJH$SDJH

KDV



E\WHV$ELWQXPEHULVDQXPEHUIURPWR,WSLFNVRXWRQHE\WHIURPDSDJH

)LJXUH9LUWXDO$GGUHVV7UDQVODWLRQ

7UDQVODWLRQ([DPSOH

6XSSRVHZHKDYHDYLUWXDODGGUHVVRI$%&'+7KLVELWDGGUHVVLVEURNHQLQWRLWVWKUHHSDUWV

7UDQVODWLRQEHJLQVDWWKHSDJHWDEOHWDEOH7KHILUVWWHQELWVSLFNRXWDQHQWU\IURPWKLVWDEOH,QRXUH[DPSOH

WKHVHELWVDUH  + ,QGLFHVVWDUWDW]HUR7KHILUVWLWHPIHWFKHGLVWKH

WKIRXUE\WHHQWU\LQWKHSDJHWDEOHWDEOH,IDOOJRHVZHOOWKLVHQWU\FRQWDLQVDQDGGUHVV,Q

VHFWLRQ

LWLVVKRZQKRZWRH[WUDFWWKLVDGGUHVV7KHDGGUHVVLVWKHDGGUHVVRIDSDJHWDEOH7KHQH[WWHQELWV

HTXDO%+RUZKLFKLVWKHQXPEHURIDQHQWU\LQWKHSDJHWDEOH$JDLQLIDOOJRHVZHOOZHPD\

H[WUDFWDQDGGUHVVIURPWKLVHQWU\7KLVDGGUHVVLVWKH5$0DGGUHVVRIWKHSDJHRQZKLFKWKHLQIRUPDWLRQ

EHLQJVRXJKWLVORFDWHG6XSSRVHWKDWWKLVDGGUHVVKDSSHQVWREH+7KHODVWELWVRIWKHYLUWXDO

DGGUHVV 2&'+DUHWKHRIIVHWZLWKLQWKHSDJH7KHWUDQVODWHGDGGUHVVLVWKHQ

&'+

3DJH7DEOH(QWULHV

6XSSRVHDPHPRU\DGGUHVVLVHQFRXQWHUHGE\WKHSURFHVVRUIRUWKHILUVWWLPHLQDUHDGFRPPDQGVXFKDV

029$/>+@

$VMXVWH[SODLQHGLQ

VHFWLRQ

DWDEOHHQWU\IRUWKLVDGGUHVVLVREWDLQHG7KLVHQWU\LVIRXUE\WHVLQVL]H

,WVOHDVWVLJQLILFDQWELWLVFDOOHGWKHSUHVHQWELW,QWKHGLDJUDPVKRZQKHUHLWLVPDUNHG33IRUSDJH

SUHVHQW

:KHQWKHSUHVHQWELWLVVHWLWPHDQVWKDWWKHVRXJKWDIWHUSDJHLVORFDWHGLQ5$0,QWKLVFDVHWKHFDOOLQJ

SURJUDPLVOXFN\DQGWKHSDJHWDEOHHQWU\MXVWUHDGSURYLGHVWKHSK\VLFDODGGUHVVRIWKHSDJHFRQWDLQLQJWKH

UHTXLUHGE\WH6LQFHDOOSDJHIUDPHVLQSK\VLFDOPHPRU\DUHVWRUHGDWDGGUHVVHVZKRVHERWWRPELWVDUH

]HURWKHDGGUHVVFDQEHJLYHQXVLQJLWVXSSHUELWV7KDWLVZKDWWKHWRSELWVRIWKHSDJHWDEOHHQWU\

SURYLGH2QFHWKHDGGUHVVRIWKHSDJHLVGHWHUPLQHGWKHPHPRU\UHDGLVFRPSOHWHGDVVKRZQLQ

VHFWLRQ





0HPRU\3URWHFWLRQ

:KHQWKHSUHVHQWELWLVQRWVHWWKHUHDUHWZRSRVVLELOLWLHV

 ,WPD\PHDQWKDWWKHSDJHFRQWDLQLQJWKHVRXJKWDIWHUE\WHLVORFDWHGRQGLVN,QWKLVFDVHD3DJH)DXOW

UHVXOWV

 ,WPD\DOVRPHDQWKDWWKHDGGUHVVLVQRWYDOLGDWDOO,QWKLVFDVHD6HJPHQWDWLRQ)DXOWUHVXOWV

7KHILUVWSRVVLELOLW\LVQRVXUSULVH7KHLGHDRISDJLQJLVWRSXWVRPHPHPRU\SDJHVRXWRQWRWKHGLVN:KHQ

DSURJUDPWULHVWRDFFHVVWKHPWKLVLVRIFRXUVHDSUREOHP3UREOHPVOLNHWKLVDUHGHDOWZLWKLQ

FKDSWHU



VHFWLRQ



7KHVHFRQGSRVVLELOLW\LVVRPHZKDWIRUHLJQWRWKHLGHDRISDJLQJDVDPHPRU\HFRQRPL]LQJIHDWXUH%XWLW

EULQJVRXWH[DFWO\ZKDWZHPHDQZKHQZHVD\WKDW/LQX[XVHVSDJLQJWRSURWHFWPHPRU\%HFDXVHWKH

SDJHWDEOHVDUHXQGHUWKHFRQWURORIWKHRSHUDWLQJV\VWHPLWJLYHVWKHRSHUDWLQJV\VWHPDQRSSRUWXQLW\WR

LQWHUFHSWHYHU\VLQJOHPHPRU\UHTXHVW7KLVLVKRZ/LQX[NHHSVSRWHQWLDOO\RYHUZKHOPLQJGHPDQGVIRU

PHPRU\XQGHUFRQWURO2QO\DGGUHVVHVRQSDJHVZKLFKLWKDVDOORFDWHGWRSURFHVVHVZLOOKDYHWKHSUHVHQWELW

LQWKHSDJHWDEOHVVHW$Q\UHIHUHQFHWRDQXQDOORFDWHGSDJHUHVXOWVLQWKHGUHDGHG6HJPHQWDWLRQ)DXOWHUURU

PHVVDJH

7KH&55HJLVWHU

7UDQVODWLRQEHJLQVDWWKHSDJHWDEOHWDEOH(DFKWDVNKDVLWVRZQSDJHWDEOHWDEOH7KHSK\VLFDODGGUHVVRIWKH

SDJHWDEOHWDEOHLVVWRUHGLQDUHJLVWHUFDOOHG&5&5VWDQGVIRUFRQWUROUHJLVWHU7KHFRQWUROUHJLVWHUVZHUH

DGGHGWRWKH[SURFHVVRUVVWDUWLQJZLWKWKH)RUPRUHGLVFXVVLRQRIWKHVHUHJLVWHUVVHH

FKDSWHU



VHFWLRQ



&5LVUHORDGHGDXWRPDWLFDOO\HYHU\WLPHWKH[SURFHVVRUFKDQJHVIURPRQHWDVNWRDQRWKHU7KLVLVZKDW

PDNHVLWSRVVLEOHIRUHDFKWDVNWRKDYHLWVRZQVHWRIYLUWXDODGGUHVVHV7KHNHUQHOPHPRU\LQWKHODVWRQH

IRXUWKRIWKHDGGUHVVVSDFHVHH

VHFWLRQ

LVWKHUHEHFDXVH/LQX[SXWVLWWKHUH7KLVDGGUHVVVSDFHLV

VKDUHGEHFDXVHWKHSDJHWDEOHVZKLFKWUDQVODWHWKHVHDGGUHVVHVDUHVKDUHG7KHODVWRQHTXDUWHURIHYHU\SDJH

WDEOHWDEOHRQWKHV\VWHPLVLGHQWLFDO

.HUQHO0HPRU\$FFHVV

7KHIDFWWKDWNHUQHODGGUHVVHVDUHVWRUHGLQDOOWKHSDJHWDEOHVRQWKHV\VWHPPLJKWOHDGXVWREHOLHYHWKDW

NHUQHOPHPRU\FDQEHXVHGE\DOOSURFHVVHVRQWKHV\VWHP,QDZD\WKLVLVWUXH,Q

FKDSWHU



VHFWLRQ

ZH

ZLOOVHHKRZXVHUFRGHPD\LQYRNHV\VWHPFDOOVWRJHWDFFHVVWRNHUQHOPHPRU\+RZHYHUXVHUFRGHE\

LWVHOIGRHVQRWKDYHWKLVNLQGRIDFFHVV,WLVEORFNHGE\WKH8B6XVHUVXSHUYLVRUELWRIWKHWDEOHHQWULHVIRU

NHUQHOPHPRU\6HH

)LJXUH



)LJXUH3DJH7DEOH7DEOH(QWU\

7KLVELWLILWLVGRHVQRWEORFNDFFHVV,ILWLVLWLVFKHFNHGDJDLQVWDWZRELWSULYLOHJHYDOXHVWRUHGLQD

VSHFLDOUHJLVWHUFDOOHGWKH&3/UHJLVWHU7KLVUHJLVWHUDQGWKHSULYLOHJHOHYHOVVWRUHGLQLWDUHGLVFXVVHGLQ

FKDSWHU



VHFWLRQ

$FFHVVLVEORFNHGLIWKHYDOXHLQWKH&3/UHJLVWHULV:KHQXVHUSURJUDPVDUH

UXQQLQJWKH&3/UHJLVWHUKROGV7KLVLVWKHEDVLFSURWHFWLRQWKDWNHUQHOPHPRU\KDVDJDLQVWDFFHVVE\XVHU

SURJUDPV

3DJLQJ3DJH7DEOHV

(QWULHVLQWKHSDJHWDEOHWDEOHORRNMXVWOLNHHQWULHVLQWKHSDJHWDEOH7KHSUHVHQWELWLQHDFKPHDQVWKHVDPH

WKLQJ,ILWLVFOHDUHGLWPHDQVWKDWWKHVRXJKWDIWHULWHPLVQRWSUHVHQW-XVWDVDSDJHRIVRPHSURFHVV V

PHPRU\FDQEHSDJHGRXWWRGLVNVRFDQDSDJHWDEOH-XVWDV.RIDGGUHVVVSDFHLQDSDJHFDQEHPDUNHG

DVXQDOORFDWHGVRFDQWKH0HJRIDGGUHVVVSDFHXQGHUDSDJHWDEOHEHPDUNHGDVXQDOORFDWHG

$PLVVLQJSDJHWDEOHFDXVHVDSDJHIDXOWRUDVHJPHQWDWLRQIDXOWMXVWOLNHDPLVVLQJSDJHRIXVHUPHPRU\

3URJUDP6HJPHQWV

&RQVLGHU

3URJUDP

:KHQWKLVSURJUDPLVUXQWKHOLQHODEHOOHG

$%&

ZLSHVLWVHOIRXW7KLVSURJUDPLVDQ

H[DPSOHRIVHOIPRGLI\LQJFRGH2QFHXSRQDWLPHLQWKHEDGROGGD\VVHOIPRGLI\LQJFRGHZDVVRPHWLPHV

XVHGWRVDYHDIHZE\WHVRIPHPRU\VSDFH7RGD\VHOIPRGLI\LQJFRGHLVQRWFRQVLGHUHGJRRGSURJUDPPLQJ

7RP6KDQOH\SXWLWPRUHEOXQWO\ZKHQKHZURWHWKDWSURJUDPPHUVZKRFUHDWHVHOIPRGLI\LQJFRGHVKRXOGEH

FDVWLQWRWKHSLWV2UGLQDULO\WKHRQO\UHDVRQWKDWDUXQQLQJSURJUDPLVPRGLILHGLVWKDWVRPHWKLQJKDV

JRQHZURQJ5XQQLQJSURJUDPVVKRXOGQRWJHWPRGLILHG

3URJUDP

3URJUDPZKLFKVHOIGHVWUXFWV



,1$/>@

$%&029>$%&@$/

5(7

1RQ:ULWHDEOH0HPRU\

8QL[UHTXLUHVWKDWUXQQLQJSURJUDPVEHSURWHFWHGIURPDFFLGHQWDOPRGLILFDWLRQE\EHLQJVWRUHGLQPHPRU\

ZKLFKLVQRWZULWHDEOH/LQX[XVHVELWRIWKHSDJHWDEOHHQWU\WRLPSOHPHQWWKLVUHTXLUHPHQW7KLVLVWKH

ELWPDUNHG:B5IRU:ULWH5HDGLQWKHGLDJUDP,IWKLVELWLVFOHDUHGWKHLQGH[HGSDJHLVQRWZULWHDEOH

:KHQWKHSURFHVVRUHQFRXQWHUVDZULWHFRPPDQGVXFKDV

029>+@$/

WKLVELWLVFKHFNHG)LUVWWKHSDJHWDEOHHQWU\IRUWKHDGGUHVV+LVIHWFKHG$VVXPLQJWKHSUHVHQWELW

LQWKHHQWU\IRUWKLVSDJHLVVHWWKHQEHFDXVHWKLVLQVWUXFWLRQLVDZULWHFRPPDQGELWWKHZULWHRUUHDGELW

LVFKHFNHG,IWKLVELWLVQRWVHWWKHSURFHVVRUZLOOQRWH[HFXWHWKHLQVWUXFWLRQDQG/LQX[LVVXHVD

6HJPHQWDWLRQ)DXOWHUURUPHVVDJH)DXOWVDUHGHVFULEHGLQJUHDWHUGHWDLOLQ

FKDSWHU



VHFWLRQ



8QL[SURWHFWVFRGHE\PDUNLQJLWDVQRQZULWHDEOH

:ULWHDEOH0HPRU\

'DWDVSDFHXVHGIRUFRPSXWDWLRQQHHGVWREHLQPHPRU\ZKLFKLVZULWHDEOH&RQVLGHU

3URJUDP

7KH

ODEHO

;<=

MXVWPDUNVVWRUHGGDWD7KHFRGHLVSHUIHFWO\

3URJUDP

7LQ\1$60SURJUDPZKLFKFUDVKHVWU\LQJWRLQFUHPHQWDE\WHRIVWRUHGGDWD



JOREDOPDLQ

PDLQ029$/>;<=@

,1&$/

029>;<=@$/

5(7

;<=GE

UHDVRQDEOH%XWEHFDXVHWKHHQWLUHSURJUDPLVVWRUHGLQQRQZULWHDEOHPHPRU\DVHJPHQWDWLRQIDXOWRFFXUV

ZKHQWKHSURFHVVRUDWWHPSWVWRH[HFXWHWKH

029>;<=@$/

LQVWUXFWLRQ7KLVLVDSUREOHP

z

2QWKHRQHKDQG/LQX[SURWHFWVWKHFRGHLQ

3URJUDP

E\VWRULQJLWRQSDJHVZKLFKDUHQRW

ZULWHDEOH

z

2QWKHRWKHUKDQGWKHODEHO

;<=

LQ

3URJUDP

PDUNVZULWHDEOHVSDFH,WWKHUHIRUHFDQQRWEHVWRUHGRQ

WKHVDPHSDJHDVWKHH[HFXWDEOHOLQHVRIWKHSURJUDP

%HFDXVHZULWHSURWHFWLRQIRUFRGHLVLPSOHPHQWHGXVLQJSDJHWDEOHHQWULHVWKHQDWOHDVWWZRGLIIHUHQWSDJHV

DUHQHHGHGIRU

3URJUDP

RQHZLWKZULWHSURWHFWLRQDQGRQHZLWKRXWLW1RSDJHFDQEHVKDUHGE\ZULWH

SURWHFWHGFRGHDQGZULWHDEOHGDWDVSDFH

7H[WDQG'DWD6HJPHQWV

3URJUDPVKDYHWREHEURNHQXS7KHGLIIHUHQWSLHFHVRIDQH[HFXWDEOHILOHDUHFDOOHGVHJPHQWV

7KHPDFKLQHFRGHFRXOGEHEURNHQXSZKHQLWZDVORDGHGEXWWKLVZRXOGSODFHXQUHDVRQDEOHGHPDQGVRQ

WKHORDGLQJSURJUDP,QRUGHUWKDWWKHVHJPHQWVGRQRWKDYHWREHFUHDWHGDWORDGWLPHWKHH[HFXWDEOHILOHLV

GLYLGHGLQWRVHJPHQWV(YHQWXDOO\ZHZLOOGHVFULEHILYHGLIIHUHQWNLQGVRIVHJPHQWV6RIDUZHKDYHPDGHD

FDVHIRUWZR

z

7H[WVHJPHQWV([HFXWDEOHFRGHQHHGVDVHJPHQWZKLFKLVVWRUHGLQSDJHVZKRVH:ULWH5HDGELWLV

FOHDUHG,WLVFDOOHGWKHWH[WVHJPHQW

z

'DWDVHJPHQWV6RPHSURJUDPVQHHGVSDFHLQWKHH[HFXWDEOHILOHZKHUHGDWDFDQEHZULWWHQ,WLV

VWRUHGLQSDJHVZKRVH:ULWH5HDGELWLVVHW,WLVFDOOHGWKHGDWDVHJPHQW

7H[WDQG'DWD6HFWLRQV

-XVWDVDQH[HFXWDEOHILOHKDVVHJPHQWVDQREMHFWFRGHILOHKDVVHFWLRQV2QHRIWKHOLQNHU VMREVLVWRSXW

WRJHWKHUDWH[WVHJPHQWIURPWKHWH[WVHFWLRQVRIDOOWKHREMHFWFRGHILOHVEHLQJOLQNHGDGDWDVHJPHQWIURP

DOOWKHGDWDVHFWLRQVHWF/LQNHUVKDYHDORWRIZRUNWRGR

:KRFUHDWHVWKHVHFWLRQVLQWKHREMHFWFRGHILOHV"2EMHFWFRGHILOHVDUHFUHDWHGE\DVVHPEOHUV

6HFWLRQ'HILQLWLRQ'LUHFWLYHV

$VVHPEOHUVGRQRWVHSDUDWHFRGHLQWRWH[WDQGGDWDVHFWLRQVDFWLQJRQWKHLURZQ$WOHDVWPRVWDVVHPEOHUV

DUHQRWWKDWVPDUW7KHSURJUDPPHUQHHGVWRKHOSRXWE\XVLQJGLUHFWLYHVWKDWVSHFLI\ZKLFKFRGHJRHVLQWR

ZKLFKVHFWLRQ7KHIROORZLQJ1$60GLUHFWLYHFDQEHXVHGWRLQLWLDWHVHFWLRQV

VHFWLRQWH[W

VSHFLILHVDWH[WVHFWLRQ6LPLODUO\

VHFWLRQGDWD

LQLWLDWHVDGDWDVHFWLRQ

:LWKWKHVHGLUHFWLYHVZHFDQGLUHFW1$60WRSURGXFHD

R

ILOHZLWKERWKWH[WDQGGDWDVHFWLRQV$GGLQJ

WKHVHGLUHFWLYHVWR

3URJUDP

JLYHVXV

3URJUDP

ZKLFKZLOOFRPSLOHDQGUXQZLWKRXWFUDVKLQJ

3URJUDP

7LQ\SURJUDPZKLFKLQFUHPHQWVDE\WHRIVWRUHGGDWD



JOREDOPDLQ

VHFWLRQWH[W

PDLQ029$/>;<=@

,1&$/

029>;<=@$/

5(7

VHFWLRQGDWD

;<=GE

6HJPHQWVLQ&&RGH

3URJUDP

FDQEHXVHGWRGHWHUPLQHWKHDGGUHVVHVRISDJHVDOORFDWHGWRLWVHOI

&DOOLQJ&IURP$VVHPEOHU

&DOOLQJIXQFWLRQVLQYROYHVXVLQJWKHVWDFN:KHQIXQFWLRQVDUHFDOOHGXVLQJDVVHPEOHULWLVSRVVLEOHWRVHH

H[DFWO\KRZWKHVWDFNLVXVHGLQDIXQFWLRQFDOO2QFH\RXNQRZKRZWRXVHWKHVWDFNWRFDOODIXQFWLRQ\RX

FDQFDOO&OLEUDU\IXQFWLRQVWRJHWDFWXDOLQSXWDQGRXWSXWIRUDVVHPEOHUSURJUDPVZKLFKUXQXQGHU/LQX[

,QRUGHUWRFDOO

SULQWI

DQG

VFDQI

XVLQJDVVHPEOHULWLVQHFHVVDU\WRSXVKVWULQJVRQWRWKHVWDFN7KLVLV

EHFDXVHWKHILUVWDUJXPHQWRIHDFKRIWKHVHIXQFWLRQVLVDOZD\VDVWULQJ7KHGEDVVHPEOHUGLUHFWLYH

LQWURGXFHGLQ

FKDSWHU



VHFWLRQ

FDQEHXVHGWRVWRUHVWULQJVDVZHOODVQXPEHUV)RUH[DPSOH

GE+HOORZRUOG?Q?[

FDQEHXVHGWRVWRUHDVWULQJ,IWKHORFDWLRQLVODEHOOHGWKHQWKHODEHOPD\EHXVHGWRSXVKWKHDGGUHVVRIWKH

VWRUHGVWULQJ,Q(GOLQDVWKHDOORZDEOHVWULQJVDUHH[DFWO\OLNHWKRVHDOORZHGLQWKH&ODQJXDJHH[FHSWWKDW

QXOOWHUPLQDWLRQPXVWEHH[SOLFLWO\HQFRGHGLILWLVGHVLUHG7KH&ODQJXDJHKH[HVFDSHVHTXHQFH

?[

PD\EH

XVHGWRLQFOXGHDQXOORUDQ\RWKHUFKDUDFWHULQWRWKHVWULQJ

3URJUDP

FKDUD  $ 

PDLQ

^FKDU Q

LQWLW

Q  D

SULQWI(QWHUDSRLQWHUGLVSODFHPHQWLQKH[

VFDQI[ L

SULQWI3RLQWHUYDOXHLQKH[ [?QQL

SULQWI5HDGZULWHRUVNLS"(QWHURU

VFDQIG W

LIW 

SULQWI&RQWHQWVWKHUH [ QL

HOVHLIW 

 QL  < 

SULQWI?Q

`

,Q1$60QRQ$6&,,FKDUDFWHUVDUHFRGHGRXWVLGHWKHVWULQJXVLQJFRPPDV

GE+HOORZRUOG$+

,QRUGHUWRFDOO

VFDQI

IURPDVVHPEOHULWLVQHFHVVDU\WRKDYHDODEHOLQDGDWDVHJPHQW7KH

VFDQI

IXQFWLRQWDNHVXVHULQSXWDQGZULWHVLWLQWRPHPRU\7KLVPHPRU\FDQQRWEHLQWKHWH[WVHJPHQW,WPXVWEH

LQDGDWDVHJPHQW%HFDXVH

SULQWI

DQG

VFDQI

RFFXUDVUHIHUHQFHVWRXQNQRZQORFDWLRQV1$60UHTXLUHV

WKHXVHRIDQ

H[WHUQ

GLUHFWLYH1$60ZLOOSURGXFHDQHUURUPHVVDJHLIDODEHOLVUHIHUUHGWRZKLFKGRHVQRW

RFFXULQWKHODEHOILHOGRIDOLQHLQWKHSURJUDPEHLQJDVVHPEOHG

3URJUDP

VKRZVKRZWRFDOO

SULQWI

DQG

VFDQI

IURPD1$60SURJUDP$ZRUGRIZDUQLQJLVLQRUGHUUHJDUGLQJUHJLVWHUXVDJH$OWKRXJKZH

PLJKWH[SHFW&OLEUDU\IXQFWLRQVVXFKDV

SULQWI

DQG

VFDQI

WRVDYHUHJLVWHUVRQWKHVWDFNEHIRUHXVLQJ

WKHPWKH\GRQ WQHFHVVDULO\9DOXHVVWRUHGLQUHJLVWHUVEHIRUHDFDOOWR

SULQWI

QHHGQRWEHWKHUHDIWHUWKLV

FDOO7RSUHVHUYHYDOXHVIURPGHVWUXFWLRQE\DOLEUDU\IXQFWLRQFDOOWKHSURJUDPPHUPXVWDVVXPHWKH

UHVSRQVLELOLW\RIVDYLQJWKHPRQWKHVWDFN7KHOLQHVODEHOHG

$%&%&'

DQG

&'(

VWRUHVWULQJV

;<=

LVORFDWHG

LQWKHGDWDVHJPHQW&RQVHTXHQWO\WKH

029($;>;<=@

LQVWUXFWLRQFDQH[HFXWHZLWKRXWFDXVLQJDPHPRU\

YLRODWLRQ

2WKHU'DWD6HJPHQWV

/LQX[XVHUPHPRU\LVGDWDVSDFHWKDWLVLQWHUQDOWRWKHSURJUDPLWVHOI7KHUHDUHWKUHHNLQGVRIGDWDVSDFH

LQWHUQDOWRDSURJUDP

3URJUDP

7KLVSURJUDPFDOFXODWHV\  [

VHFWLRQWH[W

JOREDOPDLQ

H[WHUQSULQWI

H[WHUQVFDQI

PDLQ386+$%&

&$//SULQWI

$''(63

386+;<=

386+%&'

&$//VFDQI

$''(63

029($;>;<=@

$''($;($;

,1&($;

386+($;

386+&'(

&$//SULQWI

$''(63

5(7

$%&GE(QWHUDQXPEHU$+

%&'GEG?[$+

&'(GE<RXJHWG?[$+

VHFWLRQGDWD

;<=GE 

 ,QLWLDOL]HGGDWDVSDFH,WLVVSDFHWKDWLVLQWHUQDOWRWKHH[HFXWDEOHILOHHYHQZKHQWKHILOHLVO\LQJLGOH

RXWRQWKHGLVN

 8QLQLWLDOL]HGGDWDVSDFH,WLVVSDFHWKDWLVDGGHGWRWKHSURJUDPZKHQWKHSURJUDPLVORDGHG

 '\QDPLFDOO\$OORFDWHG0HPRU\,WLVVSDFHWKDWLVDGGHGWRWKHSURJUDPZKHQLWLVH[HFXWLQJ

,QLWLDOL]HG'DWD6SDFH

,Q

FKDSWHU



VHFWLRQ

WKHXVHRIWKHGEGLUHFWLYHZDVGLVFXVVHGLQFRQQHFWLRQZLWKWKHLQLWLDOL]DWLRQRI

GDWD7KHIDFWWKDWWKLVGDWDQHHGVWREHVWRUHGSHUPDQHQWO\UHTXLUHVWKDWLWEHDSDUWRIWKHH[HFXWDEOHILOH

,IWKHVSDFHZKLFKLVRFFXSLHGE\WKLVGDWDLVHYHUZULWWHQWRE\WKHSURJUDPWKHQLWPXVWEHLQDGDWD

VHJPHQW7KH

VHFWLRQGDWD

GLUHFWLYHLVWKHULJKWWRROIRUWKLVMRE

6RPHWLPHVVWRUHGGDWDLVQHYHURYHUZULWWHQ)RUH[DPSOHFRQWUROVWULQJVVXFKDV

+HOORZRUOG

DUH

HVVHQWLDOO\QHYHUZULWWHQRQ7KLVNLQGRIGDWDPD\MXVWDVZHOOEHVWRUHGLQZULWHSURWHFWHGSDJHV,QWKHJQX

DVVHPEOHUWKHUHLVDVSHFLDOVHFWLRQODEHOIRUVHFWLRQVRIWKLVNLQG

URGDWD

8QLQLWLDOL]HG'DWD6SDFH

6SDFHZKLFKLVQHHGHGE\WKHUXQQLQJSURJUDPEXWZKLFKGRHVQRWFRQWDLQGDWDLQLWLDOO\PD\EHDGGHGWR

WKHSURJUDPZKHQLWLVORDGHG$QDUUD\GHFODUHGE\

LQW[>@

PD\ZHOORFFXS\E\WHVRIVSDFH3XWWLQJVXFKDQDUUD\LQWRDQH[HFXWDEOHILOHZRXOGEHDZDVWHRI

GLVNVSDFH7RVHWWKHVSDFHDVLGHDWORDGWLPHWKH

EVV

VHFWLRQODEHOLVXVHG

'\QDPLFDOO\$OORFDWHG0HPRU\

3URJUDPVJHWPHPRU\DWUXQWLPHXVLQJWKHV\VWHPFDOO

PDOORF

6\VWHPFDOOVDUHGLVFXVVHGLQ

FKDSWHU



VHFWLRQ



,23URWHFWLRQ

,Q

VHFWLRQ

ZHKDYHGLVFXVVHGWKHXVHRISDJLQJDVDZD\RISURWHFWLQJPHPRU\IURPXQUHJXODWHGXVHU

DFFHVV:HKDYHDOVRQRWHGWKDW,2DGGUHVVLQJLVXQSURFHVVHG,WGRHVQ WXVHSDJLQJVHJPHQWDWLRQRUDQ\

RWKHUNLQGRIWDPSHULQJZLWKWKHDGGUHVVHVLQWKHEUDFNHWV%XWWKHUHLVVXSSRUWIRU,2SURWHFWLRQLQWKHî

DUFKLWHFWXUHDQG/LQX[GRHVXVHLW

([HFXWDEOH)LOHVLQ(/))RUPDW

,Q

FKDSWHU



VHFWLRQ

ZHQRWHGWKDWEHFDXVHSURJUDPVFRQWDLQDEVROXWHDGGUHVVHVZKLFKDUHQRW

GHWHUPLQHGXQWLOORDGLQJWLPHH[HFXWDEOHILOHVFRQWDLQUHORFDWLRQWDEOHVZKLFKOLVWWKHVHORFDWLRQVLQWKHILOH

7KHVHWDEOHVQHHGWRKDYHVRPHVSHFLILHGIRUPDW

,Q

VHFWLRQ

ZHQRWHGWKDWVLQFHSURJUDPVKDYHVHJPHQWVZKLFKDUHVDYHGRQVHSDUDWHSDJHVGHSHQGLQJRQ

ZKHWKHUWKHVHJPHQWVDUHZULWHDEOHRUQRWWKHORFDWLRQRIWKHVHVHJPHQWVZLWKLQWKHILOHPXVWEHNQRZQWR

WKHRSHUDWLQJV\VWHP,I/LQX[GLGQRWKDYHWKLVLQIRUPDWLRQLWZRXOGQRWEHDEOHWRGHWHUPLQHZKLFKSDUWV

RIWKHILOHWRVWRUHLQZULWHDEOHSDJHVRIPHPRU\DQGZKLFKLQUHDGRQO\

)RUDOOWKHVHUHDVRQVH[HFXWDEOHILOHVPXVWKDYHVRPHGHILQLWHIRUPDW7KHIRUPDWXVHGE\/LQX[VWDUWLQJ

ZLWKYHUVLRQLVFDOOHG(/)([HFXWDEOHDQG/LQNLQJ)RUPDW

7ZRRWKHU8QL[H[HFXWDEOHILOHIRUPDWVDUH&2))&RPPRQ2EMHFW)LOH)RUPDWDQGDRXW$OWKRXJKDOO

8QL[V\VWHPVXVH

DRXW

DVWKHQDPHRIWKHH[HFXWDEOHILOHSURGXFHGE\WKH&FRPSLOHULWLVDOVRWKHQDPH

RIRQHSDUWLFXODUIRUPDWIRUH[HFXWDEOHILOHVDQGREMHFWFRGHILOHV$WRQHWLPHDOOYHUVLRQVRI8QL[XVHGWKH

DRXWIRUPDW1RZPRVWYHUVLRQVXVH(/)7KHERRN8QGHUVWDQGLQJDQG8VLQJ&2))SUHVHQWVDWKRURXJK

GHVFULSWLRQRIERWK&2))DQGDRXW

)LJXUH±

VKRZVWKHOD\RXWRIDQH[HFXWDEOHILOHLQ(/)IRUPDW

)LJXUH(/))RUPDW

7KH(/)+HDGHU

7KH(/)KHDGHULGHQWLILHVWKHILOHDVDQ(/)ILOHDQGVSHFLILHVZKDWNLQGRI(/)ILOHLWLV,WDOVRVSHFLILHV

WKHVL]HDQGORFDWLRQRIWKHSURJUDPKHDGHUWDEOHDQGWKHVHFWLRQKHDGHUWDEOH

z

7KHILUVWHQWU\LVDQLGHQWLILHUVWULQJFRQWDLQLQJ(/)

z

7KHVHFRQGHQWU\LVDQXPEHUZKLFKLVLIWKHILOHLVDQREMHFWILOHLIWKHILOHLVDQH[HFXWDEOHILOH

LIWKHILOHLVDVKDUHGREMHFWILOHDQGLILWLVDFRUHILOH6KDUHGREMHFWILOHVDUHGLVFXVVHGLQ

FKDSWHU



&RUHILOHVDUHSURGXFHGZKHQHYHUDSURJUDPFUDVKHV7KH\DUHFUHDWHGIRUGHEXJJLQJSXUSRVHV

z

7KHWKLUGHQWU\QXPEHUVSHFLILHVWKHPDFKLQHDUFKLWHFWXUH7KHQXPEHUVWDQGVIRUWKH[

DUFKLWHFWXUH

z

7KHUHDUHPRUHHQWULHVLQWKH(/)KHDGHUILOHLQFOXGLQJHQWULHVIRUWKHVL]HDQGORFDWLRQRIWKH

SURJUDPKHDGHUWDEOHDQGWKHVHFWLRQKHDGHUWDEOH

7KH3URJUDP+HDGHU7DEOH

7KHSURJUDPKHDGHUWDEOHKDVRQHHQWU\IRUHDFKVHJPHQW(DFKHQWU\LQWKHSURJUDPKHDGHUWDEOHFRQWDLQV

HLJKWLWHPVRILQIRUPDWLRQ

 7\SH7KHW\SHLVLIWKHVHJPHQWLVWREHORDGHGZKHQWKHILOHLVH[HFXWHG2WKHUW\SHVDUHQRWORDGHG

LQWRPHPRU\

 )LOH2IIVHW7KLVRIIVHWJLYHVWKHORFDWLRQRIWKHVHJPHQWZLWKLQWKHILOH/LNHDOORIIVHWVLWLVWKH

QXPEHURIE\WHVIURPWKHEHJLQQLQJ

 9LUWXDO$GGUHVV7KLVLVWKHDGGUHVVZKHUHWKHILUVWE\WHRIWKHVHJPHQWLVWREHORDGHG

 3K\VLFDO$GGUHVV)RU[/LQX[V\VWHPVWKLVHQWU\LVDPLVQRPHU,WLVLJQRUHG

 )LOH6L]H7KLVLVWKHQXPEHURIE\WHVLQWKHVHJPHQWEHIRUHLWLVORDGHG

 0HPRU\6L]H7KLVLVWKHQXPEHURIE\WHVLQWKHVHJPHQWDIWHULWLVORDGHG

 3HUPLVVLRQV7KLVFRGHFRQWDLQVWKHUHDGZULWHH[HFXWHSHUPLVVLRQV

 $OLJQPHQW7KHVHJPHQWPXVWEHJLQRQDPXOWLSOHRIWKLVHQWU\

$VDQH[DPSOH

7DEOH

OLVWVWKH3URJUDP+HDGHUWDEOHIRU

FKPRG

/LNHPRVW8QL[FRPPDQGVWKH

FKPRG

FRPPDQGLVDFWXDOO\DQH[HFXWDEOHILOH2QPRVWV\VWHPVLWLVORFDWHGLQ

ELQ

7DEOH

ZDVSURGXFHGE\

UXQQLQJWKHRESURJUDPRQWKLVILOH

(/)6HJPHQWV

,Q/LQX[DQH[HFXWDEOHILOHW\SLFDOO\KDVILYHVHJPHQWV6HJPHQWLVDOZD\VWKH3URJUDP+HDGHUWDEOH

1RWHWKDWLQ

7DEOH

WKHYDOXHRIWKH7\SHILHOGIRU6HJPHQWLVIRUSURJUDPKHDGHU

6HJPHQWVKDYHUHDGZULWHH[HFXWHSHUPLVVLRQVDVVRFLDWHGZLWKWKHPMXVWDVILOHVLQ8QL[GR7KHVHYHQWK

LWHPLQHDFKHQWU\RIWKH3URJUDP+HDGHUWDEOHLVWKHSHUPLVVLRQFRGHIRUWKDWHQWU\,WLVHDVLO\XQGHUVWRRG

ZKHQZULWWHQDVDELQDU\QXPEHU)RUH[DPSOHDSHUPLVVLRQFRGHRIPHDQVSHUPLVVLRQWRUHDGDQGZULWH

EXWQRWWRH[HFXWH

7DEOH3URJUDP+HDGHU7DEOHIRU

FKPRG

G3URJUDP+HDGHU7DEOH

1RWHWKDWWZRRIWKHVHJPHQWVDUHORDGDEOH7KHVHDUHWKHFRGHDQGGDWDVHJPHQWV

$OWKRXJKWKHOLQNHUFRPELQHVVHFWLRQVLQWRVHJPHQWVWKHUHDUHVHFWLRQVZKLFKDUHQRWSDUWRIDQ\VHJPHQW

7KH6HFWLRQ+HDGHUWDEOHOLVWVDQGGHVFULEHVWKHVHVHFWLRQV7KHVHSDUWVRIDQH[HFXWDEOHILOHDOVRRFFXULQDQ

REMHFWILOHDQGDUHGLVFXVVHGLQ

VHFWLRQ



&RQVLGHUWKHIROORZLQJ&SURJUDP

3URJUDP

SULQWVRXWSRLQWHUV3RLQWHUVDUHMXVWDGGUHVVHV%HFDXVH&LV

DUHODWLYHO\ORZOHYHOODQJXDJHZHZRXOGH[SHFWWKHVHSRLQWHUVWREHWKHVDPHDVWKRVHRFFXUULQJLQWKH

PDFKLQHFRGH

2EMHFW)LOHVLQ(/))RUPDW

0RVWSURJUDPVDUHQRWZULWWHQFRPSOHWHO\IURPVFUDWFK7KH\UHO\RQSURJUDPVZKLFKKDYHDOUHDG\EHHQ

ZULWWHQDQGDUHXVHGRYHUDQGRYHUDJDLQVXFKDV

SULQWI

)LOHVZKLFKQHHGRWKHUFRGHLQRUGHUWRUXQDUH

FDOOHGREMHFWFRGHILOHV,WLVWKHMRERIWKHOLQNHUWRFRPELQHREMHFWFRGHIURPGLIIHUHQWILOHVLQWRDQ

H[HFXWDEOHILOH7KHFRGHIRU

SULQWI

IRUH[DPSOHLVORFDWHGLQ

OLEOLEFVR

7\SLFDOO\WKH

SURJUDPPHUFUHDWHVRQHRUWZRRIWKHVHREMHFWFRGHILOHVXVLQJJFFRUDQDVVHPEOHUDQGWKHUHVWDUH

UHWULHYHGE\WKHOLQNHUIURPVWDQGDUGOLEUDULHVVWRUHGRQWKHV\VWHP7KLVSURFHVVLVQRWREYLRXVIURPWKH

FRPPDQGOLQHVLQFHWKHOLQNHULVFDOOHGE\JFF

,WLVLPSRUWDQWWRUHDOL]HWKDWWKHFUHDWLRQRIDQREMHFWFRGHILOHLVWKHPDLQSXUSRVHRIDQDVVHPEOHU,Q

VHFWLRQUHIVGHIGLUDVVHPEOHUFRPPDQGVIRUVKDSLQJREMHFWILOHVZLOOEHGLVFXVVHG%XWILUVWREMHFWFRGHILOHV

WKHPVHOYHVQHHGWREHGHVFULEHG-XVWDVWKHIRUPDWRIDQH[HFXWDEOHILOHLVSUHVFULEHGE\(/)VRLVWKH

IRUPDWRIDQREMHFWFRGHILOH

)LJXUH±

VKRZVWKHVWUXFWXUHRIDQ(/)REMHFWFRGHILOH7KH(/)+HDGHU

LQDQREMHFWILOHLVWKHVDPHDVWKH(/)KHDGHULQDQ

)LJXUH(/)2EMHFW)LOH)RUPDW

G3URJUDP+HDGHU7DEOH
1XP 6HJ7\SH

)LOH2IIVW

9LUWXDO$GGUHVV

3K\VLFDO$GGUHVV

)LOH6L]H 0HP6L]H

3HUP $OLJQPHQW











D

D

 





G

G

G





 











G

G

 





G

DG

DG

F

IF

 





GF

DGF

DGF





 

7\SH ORDGDEOH G\QDPLFLQIR LQWHUSUHWHU QRWH SURJUDPKHDGHU

U

Z

[







3URJUDP

LQWD [E [

LQWF [G [

PDLQ

^

 6WRUHQXPEHUVZKLFKZLOOEHYHU\HDV\WRSLFNRXW

IURPWKHPDFKLQHFRGHRIWKHFRPSLOHGSURJUDP 

D [OOOOOOOO

E [

F [

G [

SULQWI9DULDEOHV$GGUHVVHV?Q

SULQWID[?Q D

SULQWIE[?Q E

SULQWIF[?Q F

SULQWIG[?Q G

 [PHDQVWRXVHKH[DGHFLPDORXWSXW 

SULQWI?Q

`

H[HFXWDEOHILOH

6HFWLRQ+HDGHU7DEOH

7KH6HFWLRQ+HDGHUWDEOHOLVWVDOOWKHVHFWLRQVLQWKHREMHFWILOH7KHWDEOHVKRZQLQ

7DEOH

ZDVSURGXFHG

E\UXQQLQJ

RE

RQWKH

R

ILOHIRU

3URJUDP

7KH)ODJVLWHPFRQWDLQVDWWULEXWHELWVZKLFKDUHVRPHZKDW

OLNHWKHSHUPLVVLRQELWVLQWKHSURJUDPKHDGHUWDEOHRIWKHH[HFWXDEOHILOH%LWLVLIDVHFWLRQLV

H[HFXWDEOH,Q

7DEOH

WKHRQO\VHFWLRQZLWKELWVHWLVVHFWLRQZKLFKLVLQIDFWWKHWH[WVHFWLRQ%LWLV

IRUZULWHDEOHVHFWLRQV2QO\VHFWLRQVDQGDUHZULWHDEOH6HFWLRQWXUQVRXWWREHWKHGDWDVHFWLRQ

6HFWLRQV

:KHQWKHOLQNHUFUHDWHVDWH[WVHJPHQWLWFRPELQHVWKHWH[WVHFWLRQVIURPWKHREMHFWFRGHILOHV:KHQLW

FUHDWHVDGDWDVHJPHQWLWFRPELQHVGDWDVHFWLRQV7KHOLQNLQJSURFHVVLQYROYHVFROODWLQJ

:KHQWKHJQXOLQNHUOLQNV

R

ILOHVLWQHHGVWRGHVLJQDWHDQDGGUHVVZKHUHH[FHFXWLRQLVWRFRPPHQFH7KH

SURJUDPPHUFDQGHVLJQDWHWKLVE\XVLQJWKHODEHO

PDLQ

DQGPDNLQJVXUHLWLVYLVLEOHWRWKHOLQNHUE\XVLQJ

WKH

JOREDO

DVVHPEOHUGLUHFWLYH

)XUWKHU5HDGLQJ

8QGHUVWDQGLQJ(/)2EMHFW)LOHVDQG'HEXJJLQJ7RROV0DU\/RX1RKU3UHQWLFH+DOO

&KDSWHU,17(558376

7KHIHWFKH[HFXWHF\FOHLVDSURJUDPGULYHQPRGHORIFRPSXWDWLRQ%XWFRPSXWHUVDUHQRWWRWDOO\SURJUDP

GULYHQ7RVRPHH[WHQWWKH\DUHKDUGZDUHGULYHQ&38VDUHHTXLSSHGZLWKLQSXWVLJQDOSLQVZKLFKDOORZWKH

IHWFKH[HFXWHF\FOHWREHLQWHUUXSWHG7KHRULJLQDOSXUSRVHRIWKHVHSLQVZDVWRLQFUHDVHSURFHVVRUHIILFLHQF\

E\UHGXFLQJWKHDPRXQWRIWLPHVSHQWLQFRPPXQLFDWLRQZLWK,2GHYLFHV

,Q

FKDSWHU

ZHVDZKRZDGHYLFHWRLQFUHDVHPHPRU\HIILFLHQF\ZDVDGRSWHGDVDGHYLFHIRUFRQWUROOLQJ

PHPRU\DFFHVV,QWHUUXSWVKDYHXQGHUJRQHDVLPLODUWUDQVLWLRQ7KLVFKDSWHUEHJLQVE\GHVFULELQJKRZ

LQWHUUXSWVHFRQRPL]HRQSURFHVVRUWLPH7KHQVWDUWLQJZLWK

VHFWLRQ

ZHZLOOVHHKRZLQWHUUXSWVDUHXVHG

WRFRQWUROSURFHVVRUDFFHVV

3ROOLQJ

7DEOH6HFWLRQ+HDGHU7DEOHIRU

3URJUDP

OEF6HFWLRQ+HDGHU7DEOH

1DPH

7\SH

)OJV

9LUWXDO$GGUHVV

2IIVHW

6L]H

/LQN

,QIR

$OJQ0RG

(QWU\6L]H

 



















 E



















 









D









 E







F











 







G











 







G











 F







HF











 







F











 







H

G









 









I

D







D 









E









1DPHLQGH[LQWRWKH6HFWLRQ+HDGHU6WULQJ7DEOHVKVWUDE
7\SH 3URJUDP%LWV 6\PERO7DEOH 6WULQJ7DEOH 5HORFDWLRQ7DEOH +DVK7DEOH '\QDPLF,QIR 1RWH

 1R%LWV 5HORFDWLRQ7DEOH

:LWKRXWLQWHUUXSWSLQV,2FRPPXQLFDWLRQZRXOGKDYHWRUHO\RQSURFHVVRULQVWUXFWLRQVVXFKDVWKH

,1

DQG

287

FRPPDQGV

'DWD3RUWV

6XSSRVHWKDWDSURFHVVRULVVHQGLQJFKDUDFWHUVIURPDEXIIHUORFDWHGDW

$%&

WRDSULQWHUORFDWHGDWSRUW+

DQGWKDWWRGRWKLVLWLVVXHVRQHE\WH

287

FRPPDQGVIURPDORRSDVVKRZQLQ

3URJUDP

7KHQDVVXPLQJ

RQHLQVWUXFWLRQSHUPDFKLQHF\FOHHDFKH[HFXWLRQRIWKHORRSZRXOGWDNHILYHPDFKLQHF\FOHV$WDFORFN

UDWHRI0+]DOOFKDUDFWHUVZRXOGEHVHQWWRWKHSULQWHULQVHFRQGV7KLVLVHQRXJKWLPHIRU

WKHSULQWHUWRSULQWRQHRUWZRRIWKHP7KHSULQWHUZRXOGEHVZDPSHGDQGPRVWRIWKHRXWSXWWRWKHSULQWHU

ZRXOGEHORVW

3ULQWHUVDUHVORZLQFRPSDULVRQWRSURFHVVRUV6RDUHPRVWRWKHU,2GHYLFHV

6WDWXV3RUWV

7RSUHYHQWGDWDORVVDSULQWHUPXVWKDYHDVWDWXVSRUWDVZHOODVDGDWDSRUW7KHSURFHVVRUZLOOWKHQEH

UHTXLUHGWRLQTXLUHRIWKHVWDWXVSRUWZKHWKHURUQRWWKHSULQWHULVUHDG\WRUHFHLYHDQRWKHUFKDUDFWHU7KH

SURFHVVRUZLOORQO\RXWSXWDQRWKHUFKDUDFWHUZKHQWKHSULQWHULVUHDG\

3URJUDP

029(';+3ULQWHU'DWD3RUW

029(&;8VH(&;DVWKHORRSFRXQWHU

;<=029$/>$%&(&;@

$%&LVWKHEHJLQQLQJRIWKHPHPRU\DUHD

WKDWFKDUDFWHUVDUHEHLQJSULQWHGIURP

287>';@$/6HQGDFKDUDFWHUWRWKHSULQWHU

,1&(&;

&03(&;3ULQWWKLVPDQ\FKDUDFWHUV

-/;<=

6XSSRVHWKDWWKHSULQWHUZLWKWKHGDWDSRUWDWSRUW+DOVRKDVDVWDWXVSRUWDWSRUW+DQGUHVSRQGVWR

DQLQTXLU\WRWKLVSRUWZLWKDZKHQLWLVUHDG\DQGZLWKDZKHQLW VQRW,QWKLVFDVHWKHRXWSXWORRSPLJKW

ORRNOLNHWKLV$ORRS

3URJUDP

029(';+3ULQWHUVWDWXVSRUW

029(&;

;<=,1$/>';@$VNWKHSULQWHULILW VUHDG\

&03$/PHDQVLW VUHDG\

-1(;<=,IQRWWU\DJDLQ

029$/>$%&(&;@

'(&(';'DWDSRUWLV+

287>';@$/6HQGRQHE\WH

,1&(&;

,1&(';3XWEDFNWKHVWDWXVSRUW

&03(&;

-/;<=

OLNHWKLVVROYHVWKHSUREOHPRIORVWGDWDE\UHGXFLQJSURFHVVRUWKURXJKSXWGRZQWRWKHVSHHGRIWKHSULQWHU

0RVWRIWKHSURFHVVRU VWLPHLVVSHQWH[HFXWLQJWKHWKUHHLQVWUXFWLRQVIROORZLQJWKH

;<=

ODEHO

6XFFHVVLYHO\TXHU\LQJRQH,2GHYLFHDIWHUDQRWKHUDERXWLWVVWDWXVLVFDOOHGSROOLQJ3ROOLQJPDNHVDPRGHVW

LPSURYHPHQWRQWKLVVLWXDWLRQE\SXWWLQJDQLQTXLU\WRDOOSHQGLQJ,2GHYLFHVLQWRRQHVWDWXVLQTXLU\ORRS

%XWLWLVVWLOOFOHDUO\DZDVWHRISURFHVVRUWLPH

([WHUQDO,QWHUUXSWV

,QRUGHUWRDOORZSURJUDPPHUVWRDYRLGUHO\LQJRQSROOLQJSURFHVVRUVKDYHDWOHDVWRQHLQSXWSLQZKLFK

,QRUGHUWRDOORZSURJUDPPHUVWRDYRLGUHO\LQJRQSROOLQJSURFHVVRUVKDYHDWOHDVWRQHLQSXWSLQZKLFK

DOORZV,2GHYLFHVWRVLJQDOWKHSURFHVVRUZKHQWKH\QHHGWKHSURFHVVRUWRGRVRPHWKLQJ6XFKDSLQLV

FDOOHGDQLQWHUUXSWSLQ$QLQWHUUXSWSLQPDNHVLWSRVVLEOHIRUDQ,2GHYLFHWRLQLWLDWHFRPPXQLFDWLRQZLWK

WKH&38$&38ZLWKRXWDQLQWHUUXSWSLQKDVEHHQFRPSDUHGWRDWHOHSKRQHZLWKRXWDEHOO

6XSSRVHWKDWDSULQWHULVFRQQHFWHGWRDQLQWHUUXSWSLQRQWKH&38DVVKRZQLQ

)LJXUH

:LWKWKHSULQWHU

KRRNHGXSWRWKH&38LQWKLVZD\WKH&38ZRXOGEHDEOHWRLJQRUHWKHSULQWHUXQWLOLWUHFHLYHGDVLJQDO,W

FRXOGWKHQSURFHVVDSULQWHUFKDUDFWHUDQGUHWXUQWRLWVPDLQMRE7KHUHZRXOGEHUHODWLYHO\OLWWOHZDVWHGWLPH

7KLVVHWXSZRXOGZRUNILQHLIWKHSULQWHUZHUHWKHRQO\,2GHYLFHZKLFKHYHUQHHGHGDWWHQWLRQ%XWRI

FRXUVHWKHUHDUHPDQ\VXFKGHYLFHV

)LJXUH$&RPSXWHUZLWK2QO\2QH,QWHUUXSW

7RDOORZIRUVHYHUDO,2GHYLFHVRQHPLJKWH[SHFWWKHUHWREHVHYHUDOLQWHUUXSWSLQVRQWKHSURFHVVRU7KH

[DUFKLWHFWXUHGRHVQRWGRWKLQJVWKLVZD\,WKDVRQO\RQHJHQHUDOSXUSRVHLQWHUUXSWSLQ,WGHOHJDWHVWKH

DUELWUDWLRQRILQWHUUXSWVLJQDOVWRDQH[WHUQDOFLUFXLWFDOOHGWKHLQWHUUXSWFRQWUROOHUFLUFXLWDVVKRZQLQ

)LJXUH



7KLVILJXUHDOVRVKRZVDQ,54EXVIURPWKH,2V\VWHPWRWKHLQWHUUXSWFRQWUROOHUFLUFXLW$Q,54EXV

FRQVLVWVRIZLUHVIURPYDULRXV,2GHYLFHV(DFKGHYLFHWKDWQHHGVLQWHUUXSWVHUYLFHLVJLYHQRQHRIWKHZLUHV

RQWKLVEXVDVVXPLQJWKDWWKHUHDUHHQRXJKRIWKHPWRJRDURXQGWKDWLV7KH,54EXVZLUHVDUHQXPEHUHG

,54,54HWF,54VWDQGVIRULQWHUUXSWUHTXHVWOLQH7KHQXPEHUVHWFHQFRXQWHUHGLQWKLVFRQWH[W

DUHFDOOHG,54QXPEHUV

)LJXUH$&RPSXWHUZLWKDQ,QWHUUXSW&RQWUROOHU

7KHLQWHUUXSWFRQWUROOHUDOORZVVHYHUDO,2GHYLFHVWRKDYHDVLJQDOSDWKWRWKH&38HYHQWKRXJKWKH[KDV

RQO\RQHJHQHUDOSXUSRVHLQWHUUXSWSLQ

[,QWHUUXSW+DQGOLQJ

:KHQDQ[SURFHVVRUUHFHLYHVDQLQWHUUXSWVLJQDOLWILUVWFRPSOHWHVWKHLQVWUXFWLRQLWLVFXUUHQWO\ZRUNLQJ

RQ7KHQSURYLGHGDVSHFLDOIODJKDVQRWEHHQFOHDUHGLWKDQGOHVWKHLQWHUUXSWLQWKUHHVWHSV

6WHS

,WUHDGVWKHQXPEHURIWKHLQWHUUXSWUHVSRQVLEOHIRUWKHLQWHUUXSWVLJQDOIURPWKHLQWHUUXSWFRQWUROOHU

6WHS

,WIHWFKHVWKHDGGUHVVRIWKHFRUUHFWLQWHUUXSWVHUYLFHURXWLQHIURPWKHLQWHUUXSWWDEOHLQPHPRU\

6WHS

,WWUDQVIHUVFRQWUROWRWKHLQWHUUXSWVHUYLFHURXWLQH

2QFHWKHLQWHUUXSWKDVEHHQKDQGOHGLWUHVXPHVSURFHVVLQJZKHUHLWOHIWRII,QWHUUXSWVHUYLFHURXWLQHVDUH

VRPHZKDWOLNHRUGLQDU\VXEURXWLQHV2QHLPSRUWDQWGLIIHUHQFHLVWKDWWKH\DUHFDOOHGRQVLJQDOIURPWKH

KDUGZDUH

7KH,QWHUUXSW$FNQRZOHGJH%XV&\FOH

6LQFHWKH[UHFHLYHVLWVJHQHUDOLQWHUUXSWVDOOYLDRQHSLQLWFDQQRWWHOOIURPDVLQJOHNQRFNRQWKHGRRU

ZKLFK,2GHYLFHLVVLJQDOLQJIRUDWWHQWLRQ$VVKRZQLQ

)LJXUH

WKHLQWHUUXSWFRQWUROOHUFLUFXLWLV

FRQQHFWHGWRWKHGDWDEXVMXVWOLNHPHPRU\DQG,27RJHWWKHUHTXLUHGLGHQWLILFDWLRQIURPWKHLQWHUUXSW

FRQWUROOHUWKHSURFHVVRUSHUIRUPVDUHDGZKLFKLVDQDORJRXVWRDPHPRU\RUDQ,2UHDG,WLVFDOOHGWKH

LQWHUUXSWDFNQRZOHGJHEXVF\FOH-XVWDVWKHSURFHVVRUXVHVWKH0,2SLQWRLQGLFDWHZKHWKHULWLV

FRPPDQGLQJDPHPRU\RUDQ,2UHDGLWXVHVWKH'&SLQWRGLVWLQJXLVKDQ,2FRQWUROOHUUHDGIURPWKH

PHPRU\DQG,2UHDGF\FOHV'LVIRUGDWDDQG&LVIRUFRGH7KHFRPSOHWHOLVWRIWKHEXVF\FOHVGHILQHGE\

WKH'&0,2DQG:5SLQVLVJLYHQLQ

7DEOH



:KHQWKHSURFHVVRUUHFHLYHVDQLQWHUUXSWLWLQLWLDWHVDQLQWHUUXSWDFNQRZOHGJHEXVF\FOH2QO\WKHLQWHUUXSW

FRQWUROOHUPD\UHVSRQGWRDQLQWHUUXSWDFNQRZOHGJHEXVF\FOH,WUHVSRQGVE\GHSRVLWLQJDRQHE\WHQXPEHU

RQWKHERWWRPHLJKWELWVRIWKHGDWDEXV7KLVQXPEHULVFDOOHGWKHLQWHUUXSWQXPEHU,WLVQRWWKHVDPHDVDQ

,54QXPEHU7KHSURFHVVRUUHDGVWKHLQWHUUXSWQXPEHURIIWKHGDWDEXV

,65$GGUHVV)HWFKLQJ

7KHSURFHVVRUWKHQWDNHVWKLVQXPEHUDQGXVHVLWDVDQLQGH[LQWRDWDEOHFDOOHGWKH,QWHUUXSW'HVFULSWRU

7DEOH7KLVWDEOHFRQWDLQVWKHDGGUHVVHVRIWKH,QWHUUXSW6HUYLFH5RXWLQHV6HH

)LJXUH

6LQFHWKHLQWHUUXSW

QXPEHULVDQHLJKWELWQXPEHUWKHYDOLGLQWHUUXSWQXPEHUVUDQJHIURPWR

)LJXUH,QWHUUXSW'HVFULSWRU7DEOHE ,'7UHJLVWHU

7DEOH%XV&\FOH'HILQLWLRQ3LQV

'&

0,2

:5

,QWHUUXSW$FNQRZOHGJH







+DOW6SHFLDO&\FOH







&RGH5HDG







UHVHUYHG







,25HDG







,2:ULWH







0HPRU\5HDG







0HPRU\:ULWH







,WLVWKHUHVSRQVLELOLW\RIWKHRSHUDWLQJV\VWHPWRFUHDWHWKLVWDEOH,WLVDOVRUHVSRQVLEOHIRUORDGLQJLQWR

PHPRU\WKHLQWHUUXSWVHUYLFHURXWLQHVZKRVHDGGUHVVHVDUHOLVWHGLQWKLVWDEOH7KHVHWZRMREVDUHGRQHDVD

SDUWRIWKHV\VWHPERRW,IWKH\KDYHQRWEHHQGRQHWKHV\VWHPZLOOEHXQDEOHWRUHVSRQGWRLQWHUUXSWV:KHQ

(GOLQDVGLVSOD\VD3URFHVVRUKDOWHGPHVVDJHLWLVXVXDOO\EHFDXVHLWLVWU\LQJWRUHVSRQGWRDQLQWHUUXSWDQG

QRLQWHUUXSWWDEOHKDVEHHQEXLOW

7KH,QWHUUXSW'HVFULSWRU7DEOH

7KH[KDVDGHGLFDWHGUHJLVWHUZKLFKVWRUHVWKHDGGUHVVRIWKHLQWHUUXSWGHVFULSWRUWDEOHRU,'7,WLVFDOOHG

WKH,'7UHJLVWHU7KHUHDUHVSHFLDOFRPPDQGVIRUDFFHVVLQJWKLVUHJLVWHU7KHFRPPDQG

/,'7PHP

ORDGVWKHUHJLVWHU7KHFRPPDQG

6,'7PHP

VWRUHVWKHFRQWHQWVRIWKLVUHJLVWHU7KH

/,'7

FRPPDQGLVXVHGLQVHWWLQJXSWKHRSHUDWLQJV\VWHPDWERRW

WLPH2QFHDQLQWHUUXSWGHVFULSWRUWDEOHKDVEHHQFUHDWHGWKH

/,'7

FRPPDQGFDQSRLQWWKHSURFHVVRUWRLW

,QUHVSRQGLQJWRDQLQWHUUXSWWKH[XVHVWKHIDFWWKDWHDFKWDEOHHQWU\RFFXSLHVHLJKWE\WHVRIVSDFH

&RQVHTXHQWO\LIELVWKHDGGUHVVVWRUHGLQWKH,'7UHJLVWHUWKHQLQUHVSRQVHWRWKHLQWHUUXSWQXPEHUHGQWKH

[IHWFKHVWKHHLJKWE\WHVVWDUWLQJDWWKHDGGUHVVEîQ7KHVHHLJKWE\WHHQWULHVDUHFDOOHGJDWHV

,65([HFXWLRQ

2QFHWKHDGGUHVVRIWKHLQWHUUXSWVHUYLFHURXWLQHLVREWDLQHGLWLVWUHDWHGDOPRVWOLNHD

&$//

LQVWUXFWLRQWUHDWV

DQDGGUHVV%HIRUHMXPSLQJWRDWDUJHWDGGUHVVD

&$//

LQVWUXFWLRQSXVKHVWKHQH[WDGGUHVVDIWHULWVRZQ

DGGUHVVRQWRWKHVWDFN7KLVPHDQVWKDWWKHFDOOHGURXWLQHPD\UHWXUQWRWKHLQVWUXFWLRQIROORZLQJWKH

&$//

E\

UHDGLQJLWVDGGUHVVRIIWKHVWDFN6LQFHDQLQWHUUXSWVHUYLFHURXWLQHDOVRQHHGVWRH[HFXWHDUHWXUQWKHDGGUHVV

RIWKHLQVWUXFWLRQZKLFKZRXOGRWKHUZLVHKDYHEHHQH[HFXWHGKDGWKHLQWHUUXSWQRWDUULYHGLVSXVKHGRQWR

WKHVWDFNEHIRUHWKH,65LVH[HFXWHG%XWLQWKHFDVHRIDQLQWHUUXSWWKHIODJVUHJLVWHULVSXVKHGDOVR7KH

LQWHUUXSWVHUYLFHURXWLQHGRHVZKDWHYHUEXVLQHVVLVGHPDQGHGE\WKHLQWHUUXSW$QLQWHUUXSWVHUYLFHURXWLQH

VKRXOGHQGZLWKDQ

,5(7

LQVWUXFWLRQZKLFKLVOLNHD

5(7

LQVWUXFWLRQH[FHSWWKDWLWSRSVWKHIODJVUHJLVWHU

VKRXOGHQGZLWKDQ

,5(7

LQVWUXFWLRQZKLFKLVOLNHD

5(7

LQVWUXFWLRQH[FHSWWKDWLWSRSVWKHIODJVUHJLVWHU

7KHIODJVUHJLVWHULVDELWUHJLVWHUQDPHG()/$*6ZKLFKFRQWDLQVDOOWKHIODJV,WLVDQH[WHQVLRQRIWKH

ELW)/$*6UHJLVWHU

7DEOH

VKRZVWKHIODJVLQWKH()/$*6UHJLVWHURQD

7KHUHDVRQIRUWKH[ VVSHFLDOIODJEHKDYLRUZKHQUHVSRQGLQJWRLQWHUUXSWVKDVWRGRZLWKWKHSUREOHPRI

LQWHUUXSWDUELWUDWLRQ

,QWHUUXSWLQJDQ,QWHUUXSW

:KDWKDSSHQVZKHQDQLQWHUUXSWRFFXUVZKLOHDQ,65LVDOUHDG\H[HFXWLQJ"&DQRQHGHYLFHLQWHUUXSW

DQRWKHU V,65",PDJLQHWZRGHYLFHVHDFKUHIXVLQJWREHSUHHPSWHGE\WKHRWKHU V,657KHSURFHVVRUZRXOG

JHWERXQFHGEDFNDQGIRUWKIURPRQH,65WRWKHRWKHUXQWLOWKHDFFXPXODWLRQRISHQGLQJUHWXUQDGGUHVVHVRQ

WKHVWDFNRYHUIORZHGDQGFDXVHGWKHV\VWHPWRFUDVK

7KH,QWHUUXSW(QDEOH)ODJ

7KHGHVLJQRIWKHDOORZVIRUDYHU\VLPSOHZD\WRDYRLGWKLVVLWXDWLRQ7KHLGHDZRXOGEHWRHQIRUFHD

VWULFWRQHDWDWLPHLQWHUUXSWSROLF\,WZRXOGZRUNE\DXWRPDWLFDOO\EORFNLQJLQWHUUXSWVLJQDOVZKLOHDQ

,65LVUXQQLQJDQGWKHQXQEORFNLQJWKHPZKHQLWLVILQLVKHG2QHRIWKHIODJVRQWKH[SURFHVVRULVFDOOHG

WKHLQWHUUXSWHQDEOHIODJ:KHQWKLVIODJLVFOHDUHGDOOVLJQDOVRQWKHJHQHUDOSXUSRVHLQWHUUXSWSLQDUH

LJQRUHG:KHQDQHQWHUVDQ,65WKLVIODJLVDXWRPDWLFDOO\FOHDUHG7KDWLVZK\WKHSURFHVVRUSXVKHV

WKHIODJVUHJLVWHURQWRWKHVWDFNMXVWEHIRUHHQWHULQJDQ,65,WDOORZVWKHLQWHUUXSWHQDEOHIODJWREHUHVWRUHG

WRLWVRULJLQDOVWDWHZKHQWKH,65LVGRQH:KHQWKHLQWHUUXSWHQDEOHIODJLVVHWLQWHUUXSWVDUHKDQGOHG

QRUPDOO\

7KHRQHDWDWLPHLQWHUUXSWSROLF\ZRXOGPDNHOLIHHDV\IRUWKHLQWHUUXSWFRQWUROOHU7KHFRQWUROOHUFRXOG

SURFHVVDQLQFRPLQJLQWHUUXSWE\MXVWSDVVLQJLWDORQJWRWKHSURFHVVRUXQWLOLWZDVDFNQRZOHGJHG$VVRRQDV

WKHLQWHUUXSWDFNQRZOHGJHZDVUHFHLYHGWKHFRQWUROOHUFRXOGZDVKLWVKDQGVRIWKDWLQWHUUXSWEHFDXVHWKH

SURFHVVRUFRXOGEHFRXQWHGXSRQWRZRUNRQLWQRQVWRSXQWLOLWZDVGRQH

$OWKRXJKWKHRQHDWDWLPHSROLF\LVYHU\HDV\WRLPSOHPHQWRQDQ[SURFHVVRUVWDQGDUG3&VGRQRWXVH

LW7KHSUREOHPZLWKLWLVWKDWLQWHUUXSWVWKDWQHHGDTXLFNUHVSRQVHFDQEHNHSWZDLWLQJ,IDVHULDOSRUWLV

JHWWLQJUHDG\WRVWDUWWUDVKLQJGDWDEHFDXVHLWVEXIIHULVIXOOWKHQLWVKRXOGQRWEHPDGHWRZDLWZKLOHD

IORSS\GULYHORRNVIRUDJRRGVHFWRU$SURFHVVRUZLWKDRQHDWDWLPHLQWHUUXSWSROLF\FDQEHOLNHD

KRXVHKROGZLWKDVLQJOHRFFXSLHGEDWKURRP8QOLNHWKHVLWXDWLRQZLWKEDWKURRPVKRZHYHULQWHUUXSWLQJDQ

,65LVQRWQHFHVVDULO\UXGH,WVRPHWLPHVPDNHVJRRGVHQVHWRLQWHUUXSWDQ,65

1HVWHG,QWHUUXSWV

7DEOH()/$*65HJLVWHU

%LWV

/DEHO

)XOO1DPH



$&

$OLJQPHQW&KHFN



90

9LUWXDO0RGH



5)

5HVWDUW)ODJ



17

1HVWHG7DVN



,23/

,23ULYLOHJH/HYHO



2)

2YHUIORZ)ODJ



')

'LUHFWLRQ)ODJ



,)

,QWHUUXSW(QDEOH)ODJ



7)

7UDS)ODJ



6)

6LJQ)ODJ



=)

=HUR)ODJ



$)

$6&,,2YHUIORZ)ODJ



3)

3DULW\)ODJ



&)

&DUU\)ODJ

1HVWHG,QWHUUXSWV

0RVWFRPSXWHUVSULRULWL]HLQWHUUXSWVDQGWKHQDOORZKLJKHUSULRULW\LQWHUUXSWVWRLQWHUUXSWWKRVHRIORZHU

SULRULW\7KLVNLQGRISROLF\LVFDOOHGDQHVWHGLQWHUUXSWSROLF\,PSOHPHQWLQJDQHVWHGLQWHUUXSWSROLF\RQDQ

[UHTXLUHVWKDWERWKWKHLQWHUUXSWFRQWUROOHUDQGWKHSURJUDPPHUEHJLYHQPRUHUHVSRQVLELOLW\2QWKH[

WKHSURJUDPPHUKDVFRQWURORYHUWKHLQWHUUXSWHQDEOHIODJ7KH

67,

FRPPDQGVHWVWKHLQWHUUXSWHQDEOHIODJ7KH

&/,

FRPPDQGFOHDUVLW%\LQFOXGLQJDQ

67,

FRPPDQGDWWKHEHJLQQLQJRIDQ,65WKHSURJUDPPHUFDQRYHUULGH

WKHGHIDXOWRQHDWDWLPHSROLF\DQGPDNHDQ,65LQWHUUXSWLEOH,QWHUUXSWVFDQQRWEHQHVWHGLIWKH\H[HFXWH

ZLWKWKHLQWHUUXSWHQDEOHIODJFOHDUHG

7KHUHLVDOVRPRUHZRUNIRUWKHLQWHUUXSWFRQWUROOHU,IWKH[H[HFXWHV,65VZLWKWKHLQWHUUXSWHQDEOHIODJ

VHWWKHQWKHLQWHUUXSWFRQWUROOHUKDVWRDVVXPHUHVSRQVLELOLW\IRUHQIRUFLQJWKHSULRULW\V\VWHP6LQFHWKH

SURFHVVRUKDVLWVJXDUGGRZQWKHLQWHUUXSWFRQWUROOHUPXVWQRWOHWHYHU\LQFRPLQJLQWHUUXSWSDVVWKURXJK

2WKHUZLVHDVQRWHGDERYHWKH,65VFRXOGSOD\SLQJSRQJZLWKWKHSURFHVVRU,QSDUWLFXODUWKHFRQWUROOHULV

UHVSRQVLEOHIRUQRWLQWHUUXSWLQJDQLQWHUUXSWXQOHVVWKH,65EHLQJLQWHUUXSWHGKDVDORZHUSULRULW\WKDQWKH

RQHLWLVDOORZLQJWKURXJK,IWKH,65H[HFXWLQJKDVHTXDORUKLJKHUSULRULW\WKHQWKHSHQGLQJLQWHUUXSWPXVW

ZDLWXQWLOWKH,65LVILQLVKHG%XWLQRUGHUIRUWKHFRQWUROOHUWRKROGRIIWKHSHQGLQJLQWHUUXSWXQWLOWKHQLW

QHHGVWRNQRZZKHQWKH,65JHWVGRQH,WQHHGVDVLJQDO:LWKRXWDVLJQDOLWKDVQRZD\RINQRZLQJ,ILW

GRHVQ WNQRZZKHWKHUDKLJKSULRULW\,65LVILQLVKHGH[HFXWLQJWKHQLWFDQQRWGHFLGHZKHWKHULWLVRND\WR

LQWHUUXSWWKH&38ZLWKDORZSULRULW\LQWHUUXSWRUQRW6LQFHWKHLQWHUUXSWFRQWUROOHUKDVLWVRZQUHDGF\FOH

RQHPLJKWH[SHFWDZULWHF\FOHIRUWKLVSXUSRVH

7KH(2,&RPPDQG

6LQFHWKH[GRHVQRWKDYHDQ,2FRQWUROOHUZULWHF\FOHLWIDOOVWRWKHORWRIWKHSURJUDPPHUWRLQFOXGHDQ

$OO'RQHPHVVDJHWRWKHLQWHUUXSWFRQWUROOHUDWWKHHQGRIHDFK,657KLVPHVVDJHLVFDOOHGDQ(2,RUHQG

RILQWHUUXSWFRPPDQG

6RWKDWWKHLQWHUUXSWFRQWUROOHUFDQUHFHLYHFRPPXQLFDWLRQVIURPWKHSURFHVVRULWKDVDQ,2DGGUHVV7KH

SURJUDPPHUFDQWKHQXVHDQ

287

FRPPDQGWRLVVXHWKH(2,7KH,2DGGUHVVLVDOVRXVHGZKHQWKHLQWHUUXSW

FRQWUROOHUJHWVSURJUDPPHG$VQRWHGDERYHLWQHHGVWREHSURJUDPPHGVRWKDWLWNQRZVZKDWLQWHUUXSW

QXPEHUVWRUHSRUW

$VDGHYLFHZLWKDQ,2DGGUHVVWKHLQWHUUXSWFRQWUROOHUORRNVOLNHMXVWDQ\RWKHU,2GHYLFH%XWLWLVVSHFLDO

LQWKDWLWLVWKHRQO\,2GHYLFHWKDWFDQVLJQDOWKHSURFHVVRUGLUHFWO\$OOWKHRWKHUVPXVWJRWKURXJKWKH

LQWHUUXSWFRQWUROOHU

7KH10,DQG5(6(7,QWHUUXSWV

%HVLGHVWKHJHQHUDOSXUSRVHLQWHUUXSWSLQRQWKH[WKHUHDUHWZRRWKHULQWHUUXSWSLQV7KH\DUHWKH10,

DQG5(6(7SLQV

$VLJQDORQWKH10,RUQRQPDVNDEOHLQWHUUXSWSLQLVQRWEORFNHGE\FOHDULQJWKHLQWHUUXSWHQDEOHIODJ,W

GRHVQRWWULJJHUDQLQWHUUXSWDFNQRZOHGJHEXVF\FOH,WLVVHUYLFHGE\LQWHUUXSWVHUYLFHURXWLQHQXPEHU,WLV

XVHGWRVLJQDOSDULW\HUURUVLQPHPRU\RUSRZHUVXSSO\SUREOHPV

7KH5(6(7SLQLVLQWHQGHGIRUXVHLQVLWXDWLRQVZKHUHWKHUHPD\EHQRLQWHUUXSWGHVFULSWRUWDEOHLQPHPRU\

)RUH[DPSOHZKHQWKHFRPSXWHULVEHLQJWXUQHGRQ&RQVHTXHQWO\WKHUHLVQRSRLQWLQVWRULQJDQDGGUHVVIRU

LWLQWKHLQWHUUXSWWDEOH,QVWHDGWKHDGGUHVVLVEXLOWLQWRWKHSURFHVVRU7KDWDGGUHVVLV)))))))+RU

))))+RQWKH,WLVHDVLO\UHPHPEHUHGDV±LQWZR VFRPSOHPHQW7KHUHDGRQO\PHPRU\DWWKLV

DGGUHVVPXVWFRQWDLQDMXPSLQVWUXFWLRQZKRVHWDUJHWLVWKH3267RU3RZHU2Q6HOI7HVWSURJUDP7KLV

DGGUHVVPXVWFRQWDLQDMXPSLQVWUXFWLRQZKRVHWDUJHWLVWKH3267RU3RZHU2Q6HOI7HVWSURJUDP7KLV

SURJUDPLVORFDWHGRQWKH520FKLSFDOOHGWKH%,265HDGRQO\%,26FKLSVDUHVRPHWLPHVPDGHE\WKH

FRPSXWHUPDQXIDFWXUHUEXWDUHPRUHRIWHQERXJKWIURPDWKLUGSDUW\VXFKDV$PHULFDQ0HJDWUHQGVRU

3KRHQL[7KH3267FDQEHWKRXJKWRIDVWKH,65IRUWKH5(6(7LQWHUUXSW7KHILQDODFWRIWKH3267LVWR

LQLWLDWHWKHERRWVHTXHQFH7KH5(6(7SLQLVFRQQHFWHGWRWKHSRZHUVXSSO\DQGRIWHQWRDEXWWRQRQWKH

IURQWRIWKHFRPSXWHU

,6$$UFKLWHFWXUH

7KH,6$DUFKLWHFWXUHLVHVVHQWLDOO\WKHDUFKLWHFWXUHRIWKH,%0$7FRPSXWHU7KH$7LVDQEDVHG

FRPSXWHULQWURGXFHGLQ7KHQDPH,6$RU,QGXVWU\6WDQGDUG$UFKLWHFWXUHDURVHLQUHDFWLRQWRWKH

LQWURGXFWLRQE\,%0RIDQHZDUFKLWHFWXUHFDOOHG0LFUR&KDQQHOLQWKHLU36FRPSXWHUV0LFUR&KDQQHOZDV

LQWHQGHGWRUHSODFHWKHYHU\SRSXODUDUFKLWHFWXUHRIWKH$70DQ\WKLUGSDUWLHVPDQXIDFWXUHGFDUGVZKLFK

FRXOGEHLQVHUWHGLQWRWKHH[SDQVLRQVORWVRIDQ$7RUDQ$7FORQH7KHUHDFWLRQRIWKHVHWKLUGSDUWLHVWR

,%0 VQHZDUFKLWHFWXUHZKLFKZRXOGKDYHPDGHDOOWKHLU$7FDUGVREVROHWHZDVWREDQGWRJHWKHUDQG

UHQDPHWKH$7DUFKLWHFWXUHWKH,QGXVWU\6WDQGDUG$UFKLWHFWXUH$VDUHVXOWWKHOLIHVSDQRIWKH$7

DUFKLWHFWXUHZDVJLYHQDFRQVLGHUDEOHH[WHQVLRQ0DQ\LPSRUWDQWDUFKLWHFWXUDOIHDWXUHVZHUHVWDQGDUGL]HGLQ

WKH,6$LQFOXGLQJ

z

WKHLQWHUUXSWFRQWUROOHUFLUFXLW

z

PDQ\,54DVVLJQPHQWV

z

PDQ\,2SRUWDVVLJQPHQWV

z

WKHVLJQDOVDQGFRQQHFWLRQVPDGHDYDLODEOHWRH[SDQVLRQFDUGV

z

WKHSK\VLFDOFRQQHFWRUVXVHGRQH[SDQVLRQFDUGV

0DQ\RIWKHVHIHDWXUHVKDYHEHHQUHWDLQHGLQDOOVXEVHTXHQW[FRPSXWHUV

7KH,QWHUUXSW&RQWUROOHU

7KH,6$LQWHUUXSWFRQWUROOHUFLUFXLWLVEDVHGRQWKH,QWHO3,&RUSURJUDPPDEOHLQWHUUXSWFRQWUROOHU

7KHLVWKHLQWHUUXSWFRQWUROOHUFLUFXLWXVHGLQWKHRULJLQDO,%03&VPD\EHXVHGHLWKHUVLQJO\DV

LQWKH3&RUFRPELQHGLQWRDWZRWLHUHGVWUXFWXUHZLWKRQHPDVWHUDQGDQ\ZKHUHIURPRQHWRHLJKWVODYHVDV

VKRZQLQ

)LJXUH

,QWKHRULJLQDO3&WKHUHZDVDVLQJOH$RQHPDVWHURQHVODYHFRQILJXUDWLRQ

EHFDPHIL[HGDVDSDUWRIWKH,6$DUFKLWHFWXUH7KH,6$LQWHUUXSWFRQWUROOHUFLUFXLWLVVKRZQLQ

)LJXUH

,Q

WKLVFRQILJXUDWLRQWKHUHDUH,54OLQHVZKLFKIHHGLQWRWKHWZRFLUFXLWV

)LJXUH*HQHUDO&RQILJXUDWLRQ

)LJXUH,6$,QWHUUXSW&RQWUROOHU&LUFXLW

,IWKHLQWHUUXSWQXPEHUVUHSRUWHGE\WKHZHUHEXLOWLQWKHQWKHGLIIHUHQWFRQWUROOHUVLQWKLV

FRQILJXUDWLRQVKRZQLQ

)LJXUH

ZRXOGDOOUHSRUWWKHVDPHVHWRIQXPEHUV7KLVZRXOGFOHDUO\QRWEH

VDWLVIDFWRU\7KHUHDVRQIRUKDYLQJDFRQWUROOHUFLUFXLWLVVRWKDWGLIIHUHQWZLUHVRQWKH,54EXVFDQJHQHUDWH

GLIIHUHQWLQWHUUXSWQXPEHUV&RQVHTXHQWO\GLIIHUHQWVQHHGWRUHSRUWGLIIHUHQWLQWHUUXSWQXPEHUV7KH

RQO\UHDVRQDEO\HDV\ZD\WRGRWKLVZDVWRPDNHWKHSURJUDPPDEOH$QFDQEHSURJUDPPHGWR

UHSRUWDQ\HLJKWFRQVHFXWLYHQXPEHUVVWDUWLQJDWDQ\PXOWLSOHRIOHVVWKDQ3URJUDPPLQJRIWKHLV

GRQHDWERRWWLPHXVLQJ

287

FRPPDQGV7KH(2,FRPPDQGLQODQJXDJHLV+,QWKH,6$DUFKLWHFWXUH

WKHPDVWHULVDVVLJQHGWKHGDWDSRUW+&RXOGWKLVEHJHHNKXPRUDWZRUN"DVZHOODV+7KH

VODYHLVDVVLJQHGWKHSRUWV$+DQG$+

$Q(2,FRPPDQGLQUHVSRQVHWRDQLQWHUUXSWIURPWKHVODYHFRQWUROOHULVVHQWWRERWK$+DQG+

,54V

0RVWRIWKHVH,54OLQHVKDYHVSHFLILHGSXUSRVHVLQWKH,6$DUFKLWHFWXUH$OORIWKHPKDYHIL[HGLQWHUUXSW

QXPEHUV:KLOHRQHLQWHUUXSWLVEHLQJVHUYLFHGRUZKLOHWKHLQWHUUXSWIODJLVFOHDUHGXQVHUYLFHGLQWHUUXSWV

PD\SLOHXS7KHLQWHUUXSWFRQWUROOHUFLUFXLWSULRULWL]HVWKHVHLQWHUUXSWVLQWKHRUGHU,54,54,54«

,54,54,54«,54,54KDVWKHKLJKHVWSULRULW\,54KDVWKHORZHVW7KHIDFWWKDWWKHUHDUH

RQO\DIHZ,54OLQHVDYDLODEOHKDVOHDGWR,54FRQIOLFWV,54VKDULQJDVZHOODVVZLWFKHVRQFDUGVZKLFK

RQO\DIHZ,54OLQHVDYDLODEOHKDVOHDGWR,54FRQIOLFWV,54VKDULQJDVZHOODVVZLWFKHVRQFDUGVZKLFK

DOORZDQ,54OLQHWREHFKDQJHG

/LQX[PDLQWDLQVDFRXQWRIWKHLQWHUUXSWUHTXHVWVZKLFKFRPHLQRQWKH,54OLQHV7RVHHWKLVFRXQW\RX

PD\XVHWKHFRPPDQG

OLQX[ER[FDWSURFLQWHUUXSWV

7KHRXWSXWRIWKLVFRPPDQGVKRXOGEHFRPSDUHGZLWK

7DEOH



,QWHUQDODQG6RIWZDUH,QWHUUXSWV

,QWHUUXSWVZKLFKGRQRWDULVHDVWKHUHVXOWRIDQH[WHUQDOVLJQDORQDQLQWHUUXSWSLQDOVRH[LVW

([FHSWLRQV

6XSSRVHWKDWWKHIHWFKH[HFXWHF\FOHHQFRXQWHUVWKHPDFKLQHFRGH))+7KLVPDFKLQHFRGHLVQRWGHILQHG

6XSSRVHD

029

LQVWUXFWLRQDWWHPSWVWRDFFHVVDPHPRU\DGGUHVVWRZKLFKWKHRSHUDWLQJV\VWHPKDVQRWJLYHQ

SHUPLVVLRQ6XSSRVHWKDWWKH

',9

FRPPDQGSURGXFHVDTXRWLHQWZKLFKLVWRRELJIRUWKHGHVWLQDWLRQUHJLVWHU

6XSSRVHWKDWWKHVWDFNRYHUIORZV7KHVHDUHVLWXDWLRQVZKHUHWKHGHVLJQHUVRIWKH[SUHIHUUHGWRGHOHJDWH

WRWKHRSHUDWLQJV\VWHPWKHGHFLVLRQDVWRZKDWDFWLRQVKRXOGEHWDNHQ,QIDFWWKH\IRUFHGWKHRSHUDWLQJ

V\VWHPWRWDNHRYHUDWWKHVHSRLQWVE\DVVLJQLQJLQWHUUXSWQXPEHUVWRWKHVHH[FHSWLRQV7KHVHLQWHUUXSW

QXPEHUVDUHEXLOWLQWRWKH[SURFHVVRUV([FHSWLRQVGRQRWXVHLQWHUUXSWDFNQRZOHGJHEXVF\FOHV%XWWKH\

PXVWEHKDQGOHGE\QXPEHUHG,65VMXVWDVH[WHUQDOLQWHUUXSWVDUH

7DEOH

OLVWVWKHH[FHSWLRQVZKLFKDUHEXLOWLQWRWKH[SURFHVVRUV1RWHWKDWVRPHRIWKHVHLQWHUUXSW

QXPEHUVDUHWKHVDPHDVWKHLQWHUUXSWQXPEHUVUHSRUWHGE\DQ,6$LQWHUUXSWFRQWUROOHU:KHQLQWHUUXSWVDUH

VKDUHGOLNHWKLVWKH,65LVVWXFNZLWKWKHUHVSRQVLELOLW\IRUGLVWLQJXLVKLQJZKLFKVLWXDWLRQKDVFDXVHGWKH

LQWHUUXSW

6RIWZDUH,QWHUUXSWV

,QRUGHUWRPDNHWKHLQWHUUXSWVHUYLFHURXWLQHVDFFHVVLEOHWRSURJUDPPHUVWKH

,17

LQVWUXFWLRQZDVDGGHGWR

WKHLQVWUXFWLRQVHW7KHV\QWD[LVVLPSO\

,17LPP

7DEOH,6$,QWHUUXSW5RXWLQJV

,54

$OORFDWLRQ

,QWHUUXSW1XPEHU

,54

6\VWHP7LPHU

+

,54

.H\ERDUG

+

,54

6HULDO3RUW

%+

,54

6HULDO3RUW

&+

,54

3DUDOOHO3RUW

'+

,54

)ORSS\&RQWUROOHU

(+

,54

3DUDOOHO3RUW

)+

,54

5HDO7LPH&ORFN

+

,54

DYDLODEOH

+

,54

DYDLODEOH

+

,54

DYDLODEOH

+

,54

0RXVH

+

,54

(5525OLQH

+

,54

+DUG'ULYH&RQWUROOHU

+

,54

DYDLODEOH

+

ZKHUHWKHLPPHGLDWHYDOXHLVDQ\RQHE\WHQXPEHU7KLVLQVWUXFWLRQFDQEHXVHGWRH[HFXWHDQ\LQWHUUXSW

VHUYLFHURXWLQH,WLVVLPLODUWRD

&$//

LQVWUXFWLRQ

)DXOWVDQG7UDSV

:KHQWKHVHUYLFHURXWLQHIRUDQH[WHUQDOLQWHUUXSWRUDVRIWZDUHLQWHUUXSWILQLVKHVFRQWUROLVWUDQVIHUUHGWR

WKHQH[WLQVWUXFWLRQIROORZLQJWKHLQWHUUXSWMXVWDVLWZRXOGEHIROORZLQJWKHFRPSOHWLRQRIDVXEURXWLQHFDOO

7KLVLVXVXDOO\QRWWKHFDVHZLWKKDUGZDUHH[FHSWLRQV:KHQWKHVHUYLFHURXWLQHVIRUPRVWH[FHSWLRQVDUH

FRPSOHWHGWKHLQVWUXFWLRQJLYLQJULVHWRWKHPLVUHWULHG+DUGZDUHH[FHSWLRQVIRUZKLFKWKLVLVWUXHDUHFDOOHG

IDXOWV$JRRGH[DPSOHRIDIDXOWLVDSDJHIDXOW$SDJHIDXOWRFFXUVZKHQDIDLOXUHWRDFFHVVPHPRU\KDV

RFFXUUHGEHFDXVHLWKDVEHHQSDJHGRXWWRWKHGLVN7KHLQWHUUXSWVHUYLFHURXWLQHSDJHVLWEDFNLQDJDLQDQG

WKHQWKHRULJLQDOLQVWUXFWLRQLVUHWULHG

$IHZKDUGZDUHH[FHSWLRQVDUHOLNHRUGLQDU\LQWHUUXSWVDQGSDVVFRQWUROWRWKHQH[WLQVWUXFWLRQZKHQWKH\

ILQLVK7KHVHDUHFDOOHGWUDSV$QH[DPSOHRIDWUDSLVGLYLVLRQRYHUIORZRQDQ

6\VWHP&DOOV

2QHRIWKHEDVLFIXQFWLRQVRIDQRSHUDWLQJV\VWHPLVWRSURYLGHDFFHVVWRKDUGZDUHGHYLFHVDVLOOXVWUDWHGLQ

)LJXUH

,Q8QL[DOODFFHVVWRKDUGZDUHGHYLFHVLVSURYLGHGE\ZD\RIZKDWDUHFDOOHGV\VWHPFDOOV8VHUV

RUGLQDULO\JHWDFFHVVE\XVLQJHLWKHUVWDQGDUG8QL[FRPPDQGVVXFKDV

FDW

RU

OV

RUE\XVLQJ&OLEUDU\

IXQFWLRQVVXFKDV

SULQWI

RU

VFDQI

%XWERWK8QL[FRPPDQGVDQG&OLEUDU\IXQFWLRQVUHO\RQV\VWHP

FDOOVWRJDLQKDUGZDUHDFFHVV6HH

)LJXUH



UHDG

DQG

ZULWH

DUHH[DPSOHVRIV\VWHPFDOOV7KH

ZULWH



V\VWHPFDOOWDNHVWKUHHSDUDPHWHUVDILOHWREHZULWWHQWRDPHPRU\EXIIHUWREHZULWWHQIURPDQGWKH

QXPEHURIE\WHVWREHZULWWHQ,WDSSHDUVWREHDQRUGLQDU\&IXQFWLRQDQGFDQEHXVHGDVWKRXJKLWZHUH

3URJUDP

LOOXVWUDWHVD+HOORZRUOGSURJUDPXVLQJWKH

ZULWH

V\VWHPFDOO

)LJXUH6\VWHP&DOOVDUH-XVW6RIWZDUH,QWHUUXSWV

7DEOH%XLOWLQ+DUGZDUH([FHSWLRQV

$OORFDWLRQ

,QWHUUXSW1XPEHU

'LYLVLRQ2YHUIORZ

+

6LQJOH6WHS

+

10,

+

%UHDNSRLQW

+

,QWHUUXSWRQ2YHUIORZ

+

%281'

RXWRIUDQJH

+

,QYDOLG0DFKLQH&RGH

+

1RW$YDLODEOH

+

'RXEOH)DXOW

+

6HJPHQW2YHUUXQ

+

,QYDOLG7DVN6WDWH6HJPHQW

$+

6HJPHQW1RW3UHVHQW

%+

6WDFN2YHUIORZ

&+

*HQHUDO3URWHFWLRQ(UURU

'+

3DJH)DXOW

(+

UHVHUYHG

)+

(UURU

+

7DEOH$Q,QWHUUXSWLV/LNHD6XEURXWLQH

2UGLQDU\6XEURXWLQH

,QWHUUXSW6HUYLFH5RXWLQH

,QYRNH

&$//

,17

7HUPLQDWH

5(7

,5(7

3URJUDP

PDLQ

^

FKDUV>@ +HOORZRUOG?Q

ZULWHV

`

%XWGHVSLWHDSSHDUDQFHVWKH

ZULWH

V\VWHPFDOOLVQRWDQRUGLQDU\&IXQFWLRQ/LNHDOOV\VWHPFDOOVLQ

/LQX[LWXVHV

,17+

WRWUDQVIHUFRQWUROWRWKHNHUQHO(DFKV\VWHPFDOOLQ/LQX[KDVDQXPEHU$OLVWRI

WKHVHFDOOVDQGWKHLUQXPEHUVFDQEHIRXQGLQ

XVUVUFOLQX[DUFKLXQLVWGK

,Q/LQX[

ZULWH

LVV\VWHPFDOOQXPEHU7RFDUU\RXWWKLVV\VWHPFDOOWKHQXPEHUPXVWEHVWRUHGLQWKH($;

UHJLVWHUEHIRUH

,17+

LVFDOOHG

,Q'26PDQ\V\VWHPFDOOVDUHPDGHXVLQJ

,17+

7KHQXPEHUVWRUHGLQWKH$+UHJLVWHUGHWHUPLQHV

ZKLFKV\VWHPFDOOLVEHLQJPDGH$OLVWRIPRVWRIWKHVHFDOOVFDQEHIRXQGLQVWDQGDUGERRNVRQ'267KH

ERRN8QGRFXPHQWHG'26E\$QGUHZ6FKXOPDQHWDODWWHPSWVWROLVWDOORIWKHP7KHH[LVWHQFHRI

XQGRFXPHQWHG'26V\VWHPFDOOVJDYHULVHWRFRQVLGHUDEOHELWWHUQHVVRQWKHSDUWRIGHYHORSHUVZKRFRXOG

KDYHSXWVXFKIXQFWLRQVWRJRRGXVHKDGWKH\EXWNQRZQRIWKHP1HHGOHVVWRVD\SURJUDPPHUVDW0LFURVRIW

GLGQRWHQFRXQWHUWKLVREVWDFOH

7RXVHDV\VWHPFDOOIURPDVVHPEOHULWLVQHFHVVDU\WRNQRZWKHSDUDPHWHUSDVVLQJFRQYHQWLRQV7KHVH

FRQYHQWLRQVDUHHVWDEOLVKHGE\PDFURVDOVRORFDWHGLQ

XQLVWGK

$FFRUGLQJWRWKHFRQYHQWLRQVXVHGLQ

/LQX[WKHSDUDPHWHUVDUHVWRUHGLQOHIWWRULJKWRUGHULQWKHUHJLVWHUV(%;(&;(';(',DQG(6,

UHVSHFWLYHO\XVLQJDVPDQ\RIWKHVHUHJLVWHUVDVDUHQHHGHGWRVWRUHWKHSDUDPHWHUV

7KHV\VWHPFDOO

ZULWHV

IRUH[DPSOHFDQEHFRPSOHWHGLILVVWRUHGLQ(%;WKHVWULQJ

SRLQWHULVVWRUHGLQ(&;DQGLVVWRUHGLQ(';

3URJUDP

LOOXVWUDWHVWKLV,QGHEXJJLQJV\VWHPFDOOVWKH

VWUDFHXWLOLW\LVLQYDOXDEOH)RUH[DPSOHDIWHUJHWWLQJDQ

DRXW

IURPJFFIURPIRU

3URJUDP

ZHFRXOGXVH

OLQX[ER[VWUDFHDRXW

WRFKHFNRQWKLQJVLQWKHHYHQWRIGLIILFXOW\

3URJUDP

7KLVSURJUDPPDNHVDV\VWHPFDOO



JOREDOPDLQ

PDLQ

029($;:ULWHLVV\VWHPFDOO

029(%;LVQXPEHUIRUVWDQGDUGRXWSXW

029(&;$%&$%&LVWKHVWULQJSRLQWHU

029(';:ULWLQJE\WHV

,17+6\VWHPFDOOLQWHUUXSW

5(7

$%&GE+HOORZRUOG$+

$%&GE+HOORZRUOG$+

7KHUHVRXUFHVRIIHUHGE\/LQX[WRWKHSURJUDPPHUDUHHVVHQWLDOO\GHILQHGE\WKHFDSDELOLWLHVRIWKHV\VWHP

FDOOV2QHUHDVRQIRUWKHVXFFHVVRI/LQX[HDUO\RQZDVWKDWLWZDVGHVLJQHGWRDGKHUHWRWKH326,;VWDQGDUG

IRUWKHSURJUDPPHU VV\VWHPLQWHUIDFH/LQX[ZDVRQHRIWKHILUVWRSHUDWLQJV\VWHPVWRDFKLHYH326,;

FRPSOLDQFH:LQGRZV17LVDOVR326,;FRPSOLDQW

3ULYLOHJH/HYHOV

:KHQDV\VWHPFDOOWDNHVRYHUWKHSURFHVVRULWGRHVVREHFDXVHDSURJUDPQHHGVWKHNHUQHOWRGRVRPHWKLQJ

ZKLFKLWLVXQDEOHWRGRIRULWVHOIOLNHUHDGDILOHRUZULWHWRWKHPRQLWRU7KHSURJUDPLVLQFDSDEOHRIWKHVH

WKLQJVEHFDXVHWKHSURFHVVRULWVHOILVEORFNHGIURPGRLQJWKHPZKLOHXVHUFRGHLVH[HFXWLQJ7KHGLIIHUHQFH

EHWZHHQNHUQHOFRGHDQGXVHUFRGHLVDGLIIHUHQFHLQSULYLOHJHOHYHO6LQFHWKHDSURWHFWLRQV\VWHP

EDVHGRQDV\VWHPRIIRXUGLIIHUHQWSULYLOHJHOHYHOVKDVEHHQLQSODFH7KHIRXUOHYHOVDUH

z

6\VWHPOHYHOSULYLOHJHXVHGE\WKH/LQX[NHUQHO

z

8QXVHGLQ/LQX[

z

8QXVHGLQ/LQX[

z

8VHUOHYHOSULYLOHJHXVHGE\/LQX[XVHUSURJUDPV

7KHSULYLOHJHOHYHORIWKHFXUUHQWO\H[HFXWLQJFRGHLVFDOOHGWKHFXUUHQWSULYLOHJHOHYHO,WLVVWRUHGLQDWZR

ELWUHJLVWHUFDOOHGWKH&3/UHJLVWHU

7KH&3/5HJLVWHU

7KH&3/UHJLVWHULVRQHRIWKHPRVWLPSRUWDQWUHJLVWHUVRQWKHPDFKLQH/HYHOKDVWKHPRVWSULYLOHJH

&KDQJLQJWKH&3/YDOXHWRLVOLNHGLVHQJDJLQJWKHVDIHW\FDWFKRQWKHSURFHVVRU,WWDNHVSODFHHYHU\WLPH

DV\VWHPFDOOLVH[HFXWHG,WLVDPRUHGUDVWLFVWHSWKDQEHFRPLQJVXSHUXVHU3URPWKHVWDQGSRLQWRI&3/

EDVHGSULYLOHJHWKHVXSHUXVHULVMXVWDQRWKHUXVHU%XWZKHQWKH&3/LVWKHSURFHVVRUFDQGRWKLQJVWKDW

QRXVHUFDQGR)RUH[DPSOHLWFDQPRGLI\WKHSDJHWDEOHVRUFKDQJHWKHLQWHUUXSWGHVFULSWRUWDEOH

2IFRXUVHJLYHQWKDW

URRW

LVWKHRZQHURIWKHGLVNLPDJHRIWKHNHUQHOWKHILOH

YPOLQX]

LQWKHURRW

GLUHFWRU\

URRW

FDQGRZKDWHYHULWZDQWVLQGLUHFWO\E\FKDQJLQJWKLVILOH

URRW

FDQDOVRPRGLI\NHUQHOFRGH

ZKLFKLVVWRUHGLQPRGXOHV%XWWKHVHFKDQJHVZLOORQO\WDNHHIIHFWWKHQH[WWLPHWKHV\VWHPLVERRWHGRUD

NHUQHOPRGXOHLVORDGHG

3ULYLOHJHG,QVWUXFWLRQV

7KH

/,'7

LQVWUXFWLRQFKDQJHVWKHDGGUHVVVWRUHGLQWKH,'7UHJLVWHU7KLVLVWKHDGGUHVVWKDWWKHSURFHVVRU

JRHVWRZKHQLWUHFHLYHVDQLQWHUUXSW7KLVLQVWUXFWLRQKDVWKHHIIHFWRIFKDQJLQJIURPRQHLQWHUUXSWWDEOHWR

DQRWKHURQH,IXVHGE\DXVHULWFRXOGEHXVHGWRWDNHFRQWURORIDOOLQWHUUXSWVE\VHQGLQJWKHSURFHVVRUWRD

SULYDWHWDEOHIRUWKHKDQGOLQJRIDOOLQWHUXSWV,WLVDJRRGH[DPSOHRIZKDWLVFDOOHGDSULYLOHJHGLQVWUXFWLRQ

7KHSURFHVVRUZLOOQRWH[HFXWHDSULYLOHJHGLQVWUXFWLRQXQOHVVWKH&3/ ,IWKLVLQVWUXFWLRQLVLQFOXGHGLQ

FRGHZKLFKLVH[HFXWLQJZKLOHWKH&3/!IRUH[DPSOHLQXVHUFRGHZKHUHWKH&3/ LWFDXVHVDQ

H[FHSWLRQFDOOHGDJHQHUDOSURWHFWLRQHUURU6HH

7DEOH



7KH

029

PQHPRQLFQDPHVDQLQVWUXFWLRQWKDWFDQEHXVHGWRDFFHVVWKHFRQWUROUHJLVWHUV7KHFRPPDQG

029UHJUHJ

ZKHUHRQHUHJLVDFRQWUROUHJLVWHUDQGWKHRWKHULVDELWJHQHUDOUHJLVWHUFDQEHXVHGWRORDGDYDOXHLQWR

&5IRUH[DPSOH&5KROGVWKHDGGUHVVRIWKHSDJHWDEOHWDEOHZKHUHDGGUHVVWUDQVODWLRQEHJLQV/RDGLQJD

QHZYDOXHLQWR&5KDVWKHHIIHFWRIFKDQJLQJIURPRQHVHWRISDJHWDEOHVWRDQRWKHU,IWKLVFRXOGEHGRQH

E\DXVHUWKHXVHUFRXOGWDNHFRQWURORISK\VLFDOPHPRU\

029

XVHGZLWKFRQWUROUHJLVWHUVLVDQRWKHUJRRG

E\DXVHUWKHXVHUFRXOGWDNHFRQWURORISK\VLFDOPHPRU\

029

XVHGZLWKFRQWUROUHJLVWHUVLVDQRWKHUJRRG

H[DPSOHRIDSULYLOHJHGLQVWUXFWLRQ

6WDFN3UREOHPV

6LQFHWKH,65FRGHWKDWWKHLQWHUUXSWLVMXPSLQJWRPD\ZHOOXVHWKHVWDFNLWLVLPSRUWDQWWKDWWKHVWDFNQRW

EHVXEMHFWWRZULWHDFFHVVE\WKHXVHU(YHQWKRXJKXVHUFRGHZLOOQRWIXQFWLRQDJDLQXQWLOWKH,65H[LWV

WKHUHFDQVWLOOEHWURXEOH)RUH[DPSOHVXSSRVHWKDWWKHV\VWHPFDOO

UHDG

LVEHLQJH[HFXWHG

UHDG

WUDQVIHUVGDWDIURPDILOHWRXVHUPHPRU\2QHRIWKHSDUDPHWHUVWRWKLVFDOOLVWKHDGGUHVVRIVRPHPHPRU\

WKDWWKHXVHUKDVSHUPLVVLRQWRZULWHRQ,QH[HFXWLQJWKHFDOOWKHV\VWHPZLOOVWRUHILOHGDWDDWWKDWDGGUHVV

,IWKHVWDFNEHLQJXVHGE\WKHV\VWHPLVWKHXVHU VVWDFNWKHQWKHXVHUKDVSHUPLVVLRQWRZULWHRQLW7KHXVHU

PD\WKHQVXSSO\WKHVWDFNDGGUHVVDVSDUDPHWHUWR

UHDG

DQGWKHV\VWHPZLOOWKHQPHVVXSWKHVWDFNLWLV

XVLQJDWWKHYHU\WLPHLWLVXVLQJLW7KLVZRXOGFDXVHDFUDVK

8VHUFRGHZULWHVZKHUHLWVKRXOGQ WXVXDOO\E\PLVWDNHDQGQRWRXWRIPDOLFH%XWLWKDSSHQVDORW7KDW V

ZK\WKH6HJPHQWDWLRQ)DXOWHUURUPHVVDJHLVVRJDOOLQJO\IDPLOLDU&RGHIRUV\VWHPFDOOVOLNH

UHDG

QHHGV

WRXVHLWVRZQVWDFN7KHUHLVDGLIIHUHQWVWDFNIRUHDFKYDOXHRIWKH&3/&KDQJLQJVWDFNVLVWDNHQFDUHRIE\

WKHKDUGZDUH(DFKVWDFNKDVLWVRZQVWDFNSRLQWHU7KHVHIRXUVWDFNSRLQWHUVDUHVWRUHGLQDPHPRU\DUHD

FDOOHGWKH7DVN6WDWH6HJPHQW

7KHOD\RXWRIDJDWHLVEXLOWLQWRWKH[SURFHVVRU

)LJXUH

VKRZVWKHPRVWLPSRUWDQWILHOGVLQDJDWH

7KHVHILHOGVFRQWDLQWZRLWHPVWKDWSHUWDLQWRWKLV

)LJXUH*DWH/D\RXW

GLVFXVVLRQ7KH\DUH

z

$IRXUELWW\SHYDOXHZKLFKLVVWRUHGLQELWV±

z

7KHDGGUHVVRIWKH,657KLVELWDGGUHVVLVORFDWHGLQELWV±DQGELWV±RIWKHWDEOHHQWU\

,QWHUUXSWJDWHVDUHXVHGIRUKDUGZDUHLQWHUUXSWV$WUDSJDWHLVXVHGIRUWKH

,17+

V\VWHPFDOOLQWHUUXSW

&RQWURO7UDQVIHU

%DVHGRQWKHWZRLWHPVRILQIRUPDWLRQJOHDQHGIURPWKHJDWHWKHDFWLRQVGLVFXVVHGLQ

VHFWLRQV

WKURXJK



DUHWDNHQ

&OHDUWKH,QWHUUXSW(QDEOH)ODJ"

:KHQWKH[ORDGVDGHVFULSWRUWDEOHHQWU\LQUHVSRQVHWRDQLQWHUUXSWWKHIRXUELWW\SHYDOXHLVFKHFNHGWR

VHHLIWKHLQWHUUXSWHQDEOHIODJVKRXOGEHFOHDUHG,IWKHW\SHYDOXHLVWKHLQWHUUXSWHQDEOHIODJLVFOHDUHG

MXVWDVLWLVRQWKH7ZHOYHRIWKHSRVVLEOHIRXUELWYDOXHVDUHGHILQHG

6WRUHLQWRWKH&3/

7KHQH[WVWHSLQWKHSURFHVVLQJRIDQLQWHUUXSWLVWKDWLVORDGHGLQWRWKH&3/&RQILGHQFHLQWKHVDIHW\RI

7DEOH,QWHUUXSW*DWHVYV7UDS*DWHV

7\SH9DOXH *DWH7\SH

&OHDU,()ODJ

 ,QWHUUXSW*DWH

<HV

 7UDS*DWH

1R

7KHQH[WVWHSLQWKHSURFHVVLQJRIDQLQWHUUXSWLVWKDWLVORDGHGLQWRWKH&3/&RQILGHQFHLQWKHVDIHW\RI

WKLVVWHSPXVWEHEDVHGRQFRQILGHQFHLQWKHFRGHWKDWLVEHLQJMXPSHGWR

7KHRULJLQDOYDOXHRIWKH&3/LVUHVWRUHGZKHQWKH

,5(7

LQVWUXFWLRQH[HFXWHV

7KHPHFKDQLVPEHKLQGWKH&3/VWRUHDQGUHVWRUHLVGLVFXVVHGLQ

FKDSWHU



&KDQJH6WDFNV

7KH(63XVHGE\WKHNHUQHOLVZDLWLQJLQWKHWDVNVWDWHVHJPHQW7KH(63FRUUHVSRQGLQJWR&3/ LV

ORDGHGIURPWKHUHLQWR(63ZKHQLVORDGHGLQWRWKH&3/7KHFXUUHQW(63LVQRWVWRUHGLQWKHWDVNVWDWH

VHJPHQW,WLVSXVKHGRQWRWKHQHZVWDFN

7KHIDFWWKDWWKHWDVNVWDWHVHJPHQWLVQRWFKDQJHGZKHQLVVWRUHGLQWRWKH&3/LVVRPHWLPHVZKDWLVPHDQW

E\VD\LQJWKDWWKHNHUQHOLVH[HFXWLQJZLWKLQDWDVNRULQEHKDOIRIDWDVN,QRWKHUZRUGVWKHUHLVQRWDVN

VZLWFKLQYROYHG7KHVDPHWDVNLVVWLOOUXQQLQJ

-XPSWRWKH,65

7RGRWKHMXPSWKHUHWXUQDGGUHVVRIWKHQH[WLQVWUXFWLRQLVSXVKHGRQWRWKHQHZVWDFN7KHQHZ(,3LVWKHQ

ORDGHGZLWKWKHELWDGGUHVVIURPWKHJDWH

:KHQWKHVHIRXUVWHSVKDYHEHHQFRPSOHWHGFRQWUROKDVEHHQWUDQVIHUUHGWRNHUQHOFRGHZKLFKUXQVDW&3/

7KHUHVRXUFHVRIWKHSURFHVVRUZKLFKDUHDFFHVVLEOHIURPWKLVOHYHORISULYLOHJHLQFOXGHDOOWKHGDWD

VWUXFWXUHVYLWDOWRWKHIXQFWLRQLQJRIWKHRSHUDWLQJV\VWHPDVZHOODVWKHKDUGZDUHDQGWKHPHPRU\

:KHQWKH,65LVFRQFOXGHGWKHQZLWKRQHH[FHSWLRQFRQWUROLVUHWXUQHGWRWKHXVHUFRGH%RWKWKHROGVWDFN

DQGWKH&3/DUHUHVWRUHG7KHH[FHSWLRQLVLQWKHFDVHRIWKHWLPHULQWHUUXSW

6FKHGXOLQJ

,Q

7DEOH

ZHVHHWKDWWKHPDVNDEOHLQWHUUXSWZLWKWKHKLJKHVWSULRULW\LVWKHWLPHULQWHUUXSW7KH,65IRU

WKLVLQWHUUXSWNHHSVWUDFNRIWLPHXVHGE\DOOSURFHVVHV,QSDUWLFXODULWVHWVDIODJFDOOHG

QHHGBUHVFKHG

ZKHQDSURFHVVLVRXWRIWLPH:KHQ/LQX[GRHVDUHWXUQIURPDQ\LQWHUUXSWWKHWLPHULQWHUUXSWLQFOXGHGLW

FKHFNVWKLVIODJDQGFDOOVWKH

VFKHGXOH

LI

QHHGBUHVFKHG

LVVHW7KH

VFKHGXOH

V\VWHPFDOOLVWKH

VFKHGXOHU,WLVWKHFHQWUDOSURJUDPLQWKHRSHUDWLQJV\VWHP,WGHWHUPLQHVZKLFKSURFHVVJHWVWRUXQQH[W

:KHQQHFHVVDU\LWLQLWLDWHVDWDVNVZLWFK

6RWKHXOWLPDWHFRPSXWLQJUHVRXUFHSURFHVVRUWLPHDOVRIDOOVXQGHUWKHFRQWURORIWKH&3/EDVHGSURWHFWLRQ

V\VWHP

)XUWKHU5HDGLQJ

,6$6\VWHP$UFKLWHFWXUH7RP6KDQOH\DQG'RQ$QGHUVRQ$GGLVRQ:HVOH\

,QWHUUXSW'ULYHQ3&6\VWHP'HVLJQ-RVHSK0F*LYHUQ$QQDERRNV

&KDSWHU%,70$1,38/$7,216

%LWZLVH/RJLF2SHUDWLRQV

7KH$1'25127DQG;25&RPPDQGV

%LW6HWWLQJDQG7HVWLQJ

6KLIW,QVWUXFWLRQV

%LWZLVH/RJLF2SHUDWLRQV

,Q

FKDSWHU



VHFWLRQ

FLUFXLWVDQGWUXWKWDEOHVIRUWKH%RROHDQRSHUDWLRQV$1'25127DQG;25

ZHUHGLVFXVVHG7KHWUXWKWDEOHIRU$1'LV

DQGLVLPSOHPHQWHGXVLQJWKH%RROHDQFLUFXLW

,IHLJKWRIWKHVH%RROHDQFLUFXLWVDUHXVHGLQSDUDOOHOWKHQWZRHLJKWELWQXPEHUV





ZKHQIHGLQWRWKHHLJKW$1'JDWHVUHVXOWLQRQHHLJKWELWRXWSXW



7KHRSHUDWLRQLVFDUULHGRXWDVVKRZQLQ

)LJXUH

,QKH[QRWDWLRQWKHE\WHV)+DQG&+XVHGDVLQSXWV

WRDRQHE\WH$1'RSHUDWLRQKDYHSURGXFHGWKHRXWSXW&+7KLVRSHUDWLRQFDQEHDSSOLHGWRDQ\QXPEHU

RIELWV7KH%RROHDQRSHUDWLRQV25;25DQG127FDQDOVREHDSSOLHGLQELWZLVHSDUDOOHOIDVKLRQ

)LJXUH%LWZLVH$1'2SHUDWLRQ

7KH

$1'25127

DQG

;25

&RPPDQGV

+LJKOHYHOSURJUDPPLQJODQJXDJHVLQFOXGHVXSSRUWIRU%RROHDQRSHUDWLRQVVXFKDV$1'25DQG127

7KH\UHO\RQDVVHPEOHUDQGPDFKLQHOHYHOLPSOHPHQWDWLRQRIWKHVHRSHUDWLRQV

7KH

$1'

LQVWUXFWLRQDSSOLHVWKH$1'RSHUDWLRQWRWZRRSHUDQGVLQPXFKWKHVDPHZD\WKDWWKH

$''

LQVWUXFWLRQDGGVWZRRSHUDQGV7KHIROORZLQJIRUPVDUHDOOYDOLGIRUWKH

$1'

FRPPDQG

$1'UHJLPP

$1'UHJUHJ

S

T

S$1'T

























$VZLWKWKH

$''

FRPPDQGVDPHPRU\RSHUDQGFDQWDNHWKHSODFHRIRQHUHJLVWHURSHUDQG$OVROLNHWKH

$''

FRPPDQGWKHWZRRSHUDQGVPXVWKDYHWKHVDPHVL]H)RUH[DPSOHVXSSRVHWKDWWKH$/UHJLVWHUFRQWDLQV

)+DQG%/FRQWDLQV&+7KHQWKHFRPPDQG

$1'$/%/

ZRXOGVWRUHWKHUHVXOW&+LQWR$/DQGOHDYH%/XQFKDQJHG

([FHSWIRUWKHIDFWWKDWWKH\DSSO\GLIIHUHQWRSHUDWLRQVWKH

25

DQG

;25

FRPPDQGVDUHWKHVDPHDVWKH

$1'

FRPPDQG7KH

127

LQVWUXFWLRQWDNHVRQO\RQHRSHUDQGUHJLVWHURUPHPRU\

(GOLQDVFDQEHXVHGWRFKHFNWKHUHVXOWVRIDSSO\LQJWKHVHFRPPDQGV)RUH[DPSOH

029($;)+

029(%;&+

$1'$/%/

VKRXOGUHVXOWLQWKHVWRUDJHRI&+LQ$/

$OOWKHVHORJLFFRPPDQGVFOHDUWKHRYHUIORZDQGFDUU\IODJV7KH\VHWWKHVLJQIODJLIWKHPRVWVLJQLILFDQWELW

RIWKHUHVXOWLVDQGFOHDULWRWKHUZLVH7KH\VHWWKH]HURIODJLIWKHUHVXOWLVDQGFOHDULWRWKHUZLVH7KH

]HURIODJLVRIWHQXVHGWRGHWHUPLQHFRQGLWLRQDOMXPSVIROORZLQJORJLFFRPPDQGV

)RUH[DPSOHZHFDQXVHWKH

$1'

FRPPDQGWRGHWHUPLQHZKHWKHUDQXPEHUVWRUHGLQDUHJLVWHULVHYHQRU

RGG$QXPEHUUHSUHVHQWHGLQELQDU\LVHYHQZKHQLWVOHDVWVLJQLILFDQWELWLV]HUR,IZHKDYHDRQHE\H

UHJLVWHUWKHQWKH

$1'

LQVWUXFWLRQFDQEHDSSOLHGWRLWXVLQJWKHELQDU\QXPEHUDVWKHVRXUFH

RSHUDQG

7KHQDOOWKHELWVRIWKHUHVXOWZLOOEHH[FHSWSRVVLEO\WKHOHDVWVLJQLILFDQWELW7KLVELWZLOOEHLIWKH

QXPEHUEHLQJWHVWHGLVHYHQ

029%/$/3UHSDUHWRWHVW$/IRUHYHQQHVV

$1'%/7KH]HURIODJLVVHWLI%/ 

-=(91-XPSLI$/LVHYHQ

7KH

7(67

LQVWUXFWLRQLVOLNHWKH

&03

LQVWUXFWLRQLQWKDWLWVHWVIODJVZLWKRXWVWRULQJWKHUHVXOW

&03

LVDQ

XQVWRUHG

68%

LQVWUXFWLRQ

7(67

LVDQXQVWRUHG

$1'

LQVWUXFWLRQ8VLQJ

7(67

WKHWKUHHLQVWUXFWLRQVXVHGWRWHVW

WKHHYHQQHVVRI$/FDQEHVKRUWHQHGWRMXVWWZR

7(67$/

-=(91-XPSLI$/LVHYHQ

%LW6HWWLQJDQG7HVWLQJ

2QHYLUWXHRIORJLFRSHUDWLRQVLVWKDWWKH\JLYHWKHSURJUDPPHUFRQWURORYHULQGLYLGXDOELWVRIPHPRU\RU

,2UHJLVWHUV

7XUQLQJWKH6SHDNHU2QDQG2II

7KHV\VWHPERDUGVSHDNHULVDQRWKHUUHODWLYHO\IL[HGIHDWXUHRIWKHVWDQGDUG3&,WVDXGLRVLJQDOFRPHVIURP

D0+]VTXDUHZDYH7RJHWFRQWURORYHUWKHVSHDNHU VSLWFKWKLVVLJQDOLVGLYLGHGE\WKHQXPEHU

VWRUHGLQWKHWZRE\WHUHJLVWHUORFDWHGDW,2DGGUHVV+7KLVUHJLVWHUPXVWEHZULWWHQWRXVLQJWZR

VXFFHVVLYHRQHE\WHZULWHVPRVWVLJQLILFDQWE\WHILUVW:KHWKHUWKHVSHDNHULVWXUQHGRQRUQRWLVFRQWUROOHG

E\WKHERWWRPWZRELWVRIDYHU\LPSRUWDQWRQHE\WHUHJLVWHUORFDWHGDW,2DGGUHVV+6RPHRIWKHELWVRI

WKLVUHJLVWHULQGLFDWHSDULW\HUURUVLQPHPRU\5HSRUWVRIWKHVHHUURUVFDXVHWKHV\VWHPWRKDOW&RQVHTXHQWO\

ZHGRQ WZDQWWRIOLSRQHRIWKHPLGO\RUDFFLGHQWDOO\7KH

$1'

DQG

25

LQVWUXFWLRQVDUHSHUIHFWO\VXLWHGIRU

FKDQJLQJVRPHELWVDQGOHDYLQJWKHRWKHUVDORQH)RUH[DPSOHWRWXUQWKHVSHDNHURQWKHIROORZLQJWKUHH

FRPPDQGVDUHQHHGHG

FRPPDQGVDUHQHHGHG

,1$/>+@

25$/

287>+@$/

7RWXUQWKHPRII

,1$/>+@

$1'$/2)&+

287>+@$/

ZLOOGR

,WVKRXOGEHQRWHGWKDWLQ/LQX[DFFHVVWR,2SRUWVE\XVHUVLVE\GHIDXOWDWOHDVWSURKLELWHG,2

SHUPLVVLRQVFDQEHJLYHQWRDSURFHVVKRZHYHUE\WKHV\VWHPFDOOV

LRSHUP

DQG

LRSO

ZKLFKDUH

VSHFLDOO\DGDSWHGWRWKH[DUFKLWHFWXUH

(GJHYV/HYHO7ULJJHUHG,54%LWV

7KHSURJUDPPDEOHLQWHUUXSWFRQWUROOHUGLVFXVVHGLQ

FKDSWHU



VHFWLRQ

KDVDUHJLVWHUZKLFK

GHWHUPLQHVZKHWKHUWKHLQWHUUXSWVLWUHFHLYHVZLOOEHSURFHVVHGDVHGJHWULJJHUHGRUOHYHOWULJJHUHG7KHUHLV

RQHELWIRUHDFKRIWKHHLJKW,54OLQHVWKDWLWKDQGOHV7KHGLIIHUHQFHEHWZHHQWKHWZRWULJJHULQJPRGHVLV

LPSRUWDQW,IDQ,2GHYLFHXVHVOHYHOWULJJHUHGVLJQDOLQJDQGWKHWUHDWVLWV,54DVHGJHWULJJHUHGWKHQ

LQWHUUXSWVLJQDOVIURPWKH,2GHYLFHFRXOGEHLJQRUHG%\XVLQJELWPDQLSXODWLRQFRPPDQGVLWLVSRVVLEOHWR

VLQJOHRXWRQHELWRQWKLVUHJLVWHUDQGFKDQJHLW

)RUH[DPSOHVXSSRVHWKDWZHDUHLQVWDOOLQJDFDUGZKLFKVHQGVRXWHGJHWULJJHUHGLQWHUUXSWUHTXHVWVRQ

,54,54LVWKHUHTXHVWOLQHFRQYHQWLRQDOO\DVVRFLDWHGZLWK&202QDQ(,6$PDFKLQHWKHUHJLVWHU

ZKLFKFRQWUROVWKLVWULJJHULQJLVORFDWHGDW,2SRUW'+,WLVFDOOHGDQ(/&5(GJH/HYHO&RQWURO

5HJLVWHU(DFKELWPDNHVWKHFRUUHVSRQGLQJ,54OLQHHGJHWULJJHUHGHDFKELWFDXVHVOHYHOWULJJHULQJ

7KHVLPSOHVWZD\WRPDNH,54HGJHWULJJHUHGZRXOGEHWRZULWHDWRWKLVSRUW

029$/

029(';'+(/&5 VDGGUHVVLV'+

287>';@$/6WRUHD]HURLQWKH(/&5

%XWWKLVZRXOGEHDEDGLGHD,WZRXOGPDNHDOOHLJKWELWVLQWKH(/&5$Q\RIWKH,54VZKLFKKDSSHQHG

WRXVHOHYHOWULJJHULQJZRXOGJHWIRXOHGXS7RVHWWKHPDOOFRUUHFWO\ZHPXVWNQRZZKDWDOOWKHWULJJHULQJV

DUHIRUDOOHLJKWLQSXWVRUZHFDQMXVWOHDYHWKHPDVWKH\DUHH[FHSWIRUWKHIRXUWKELW7RPDNHELW]HURZH

FDQ25WKHFRQWHQWVRIWKH(/&5ZLWKWKHELQDU\QXPEHU ()+7RGRWKDWZHQHHGWRUHDG

IURPWKH(/&5GRWKHPDVNLQJDQGWKHQZULWHEDFNWRLW

3URJUDP

029(';'+(/&5 VDGGUHVVLV'+

,1$/>';@5HDGWKH(/&5UHJLVWHU

$1'$/()+0DVNRXWELW

287>';@$/:ULWHDOWHUHGE\WHEDFNRXWWRWKH(/&5

'LVDOORZLQJ1RQ²PDVNDEOH,QWHUUXSWV

2Q,6$PDFKLQHVQRQ²PDVNDEOHLQWHUUXSWVFDQEHVWRSSHGEHIRUHWKH\JHWWRWKHSURFHVVRU7KH\UXQ

WKURXJKDJDWHZKLFKLVFRQWUROOHGE\ELWRIDQ,2UHJLVWHUORFDWHGDWSRUW+,IWKLVELWLV10,VDUH

DOORZHG0HPRU\SUREOHPVFDQFDXVHDQRQPDVNDEOHLQWHUUXSWWRRFFXU6XSSRVHWKDWZHZDQWWR

FLUFXPYHQWWKLVVDIHJXDUGE\VKXWWLQJRII10,V7RPDNHELWHTXDOWRZHFDQ25WKHFRQWHQWVRIWKH,2

UHJLVWHUZLWK +

3URJUDP

,1$/>+@5HDGWKHE\WH

25$/+0DVNRXWELW

25$/+0DVNRXWELW

287>+@$/:ULWHDOWHUHGE\WHEDFNRXW

6KLIW,QVWUXFWLRQV

5HJLVWHUVZKLFKFDQVKLIWELWVULJKWRUOHIWDUHFDOOHGVKLIWUHJLVWHUV6XSSRVHWKDWDELWVKLIWUHJLVWHU

FRQWDLQVWKHELQDU\QXPEHU



6KLIWLQJWKLVQXPEHUWRWKHULJKWE\RQHELW\LHOGV



DQGVHWVWKHFDUU\IODJVLQFHWKHULJKWPRVWELWZDV6KLIWUHJLVWHUVDUHSDUWRIWKHVWDQGDUGUHSHUWRLUHRI

PLFURSURFHVVRUV,QWKH[WKHELWZKLFKLVORVWLVJHQHUDOO\VWRUHGLQWKHFDUU\IODJ+HQFHIROORZLQJWKH

VKLIWMXVWVKRZQWKHFDUU\IODJZRXOGEHVHW:KHUHWKHQHZELWFRPHVIURPGHSHQGVRQZKLFKVKLIW

FRPPDQGLVXVHG:KHQWKHQHZELWLVWKHVKLIWLVUHIHUUHGWRDVDORJLFDOVKLIW1RWLFHWKDWVKLIWLQJWKH

QXPEHU



WRWKHULJKWE\RQHELWLQWKLVPDQQHU



\LHOGV$ULJKWZDUGVKLIWPD\WKXVEHXVHGWRDFFRPSOLVKGLYLVLRQE\WZR7KHORJLFDOVKLIWKRZHYHUIDLOV

WRGRWKLVFRUUHFWO\RQVLJQHGQXPEHUV$QHLJKWELWWZR VFRPSOHPHQWYDOXHVXFKDV



ZKHQVKLIWHGWRWKHULJKWE\RQHXVLQJDORJLFDOVKLIW



\LHOGVQRW,IZKDWZHUHDOO\ZDQWLVWRGLYLGHE\WZRWKHQWKHQHZOHIWPRVWELWVKRXOGEHFRSLHG

IURPWKHROGRQH,QWKLVFDVHZHZRXOGJHW



LQVWHDGZKLFKDFWXDOO\LV±7KLVNLQGRIDVKLIWLVUHIHUUHGWRDVDQDULWKPHWLFVKLIWRUVRPHWLPHVDOVRDVD

VLJQH[WHQGHGVKLIW6LQFHDQDULWKPHWLFVKLIWSURGXFHVDQHUURQHRXVGLYLVLRQZKHQDODUJHXQVLJQHGYDOXHLV

XVHGWKHODWWHUWHUPLVDSUREDEO\EHWWHURQH7KHSUREOHPGRHVQRWRFFXUZLWKOHIWZDUGVKLIWV7KH

FRPPDQGVIRUULJKWZDUGORJLFDODQGDULWKPHWLFVKLIWVDUH

6+5UHJLPP

6+5UHJ&/

6$5UHJLPP

6$5UHJ&/

ZKHUHWKHLPPHGLDWHYDOXHPXVWEHDRQHE\WHQXPEHU/HIWZDUGVKLIWVXVHWKHPQHPRQLFV

6+/

DQG

6$/

7KHVHWZRPQHPRQLFVDFWXDOO\UHIHUWRWKHVDPHRSFRGHV7KH\KDYHWKHVDPHYDOLGIRUPVDV

6+5

DQG

6$5

,QDOOWKHVHFDVHVDPHPRU\RSHUDQGPD\UHSODFHWKHUHJLVWHURSHUDQG

:KHQWKHORVWELWLVUHF\FOHGDVWKHQHZELWWKHVKLIWLVUHIHUUHGWRDVDURWDWH

52/

DQG

525

DUH

PQHPRQLFVIRUURWDWHOHIWDQGURWDWHULJKW-XVWDVLQWKHORJLFDODQGDULWKPHWLFVKLIWVWKHFDUU\IODJWDNHVRQ

WKHYDOXHRIWKHURWDWHGELW%XWLWGRHVQRWSDUWLFLSDWHLQWKHURWDWLRQ7RLQFOXGHWKHFDUU\ELWLQWRWKHF\FOH

XVHWKH

5&5

DQG

5&/

FRPPDQGV

5&/

DQG

5&5

UHIHUWRURWDWHWKURXJKFDUU\OHIWDQGURWDWHWKURXJKFDUU\ULJKW

7DEOH

LOOXVWUDWHVWKHHIIHFWRIHDFKRIWKHVHURWDWHLQVWUXFWLRQVDVVXPLQJWKDWEHIRUHWKHURWDWH

LOOXVWUDWHVWKHHIIHFWRIHDFKRIWKHVHURWDWHLQVWUXFWLRQVDVVXPLQJWKDWEHIRUHWKHURWDWH

LQVWUXFWLRQLVH[HFXWHG$/LVDQG&) 

6KLIWUHJLVWHUVDUHXVHGE\WKHSURFHVVRUWRSHUIRUPPXOWLSOLFDWLRQ7KHSURFHVVRUGRHVQRWKDYHD

PXOWLSOLFDWLRQFRPPDQG%XWLWGRHVKDYHVKLIWFRPPDQGV$SURJUDPOLNHWKHIROORZLQJFDQEHXVHGWRGR

PXOWLSOLFDWLRQXVLQJVKLIWFRPPDQGV

3URJUDP

,1($;>@

029(&;($;PXOWLSOLHU

,1($;>@

029(%;($;PXOWLSOLFDQG

;25($;,QLWLDOL]HWKHWRWDO

$*1&03(&;,VPXOWLSOLHU\HW"

-('81

7(67(&;,VERWWRPELWRIPXOWLSOLHU

-=6.3,IVRDGGWKHPXOWLSOLFDQG

$''($;(%;$GGVKLIWHGPXOWLSOLFDQGWRWKHWRWDO

-&%$'$FDUU\KHUHLVDQRYHUIORZ

6.36+/(%;0XOWLSOLFDQGJRHVOHIW

-&%$'%HWWHUQRWRYHUIORZKHUHHLWKHU

6+5(&;6KLIWWKHPXOWLSOLHUWRWKHULJKW

-03$*1

'81287>@($;

%$'5(71RRXWSXWLIPXOWLSOLFDWLRQRYHUIORZV

&KDSWHU'(9,&('5,9(56

,Q

FKDSWHU

WKHXVHRIPHPRU\FRPPDQGVZDVGLVFXVVHGDVVXPLQJWKDWWKHSURJUDPPHUKDVXQUHVWULFWHG

DFFHVVWRPHPRU\,Q

FKDSWHU

WKHXVHRIPHPRU\FRPPDQGVLQXVHUSURJUDPVZKHUH/LQX[UHVWULFWV

PHPRU\DFFHVVLVGLVFXVVHG,Q

FKDSWHU



VHFWLRQ

WKHXVHRI,2FRPPDQGVLVGLVFXVVHGDJDLQDVVXPLQJ

WKDWWKHSURJUDPPHUKDVXQUHVWULFWHG,2DFFHVV$OWKRXJKWKHUHDUHV\VWHPFRPPDQGVZKRVHSXUSRVHLVWR

JUDQW,2DFFHVVWRDXVHUWKHGHIDXOWVLWXDWLRQLQ/LQX[GLVDOORZVWKHXVHRI

,1

DQG

287

LQVWUXFWLRQVLQXVHU

SURJUDPV8VHUDFFHVVWRSHULSKHUDOVWDNHVSODFHRQO\E\ZD\RIV\WHPFDOOV6\VWHPFDOOVWUDQVODWHXVHU

VHUYLFHUHTXHVWVLQWR

,1

DQG

287

LQVWUXFWLRQV%HFDXVHV\VWHPFDOOVH[HFXWHDWSULYLOHJHOHYHO]HURWKHVH,2

LQVWUXFWLRQVFDQEHH[HFXWHG

$GHYLFHGULYHUFRQVLVWVRIDOOWKHSURJUDPVQHHGHGWRWUDQVODWHV\VWHPFDOOVWRDSDUWLFXODUGHYLFHLQWR,2

LQVWUXFWLRQVWRWKDWGHYLFHSOXVDSURJUDPWRKDQGOHLQWHUUXSWVHUYLFHUHTXHVWVLVVXHGE\WKHGHYLFH$OOWKH

SURJUDPVLQWKHGHYLFHGULYHUDUHLQFRUSRUDWHGLQWRWKH/LQX[NHUQHO2YHUKDOIWKHFRGHLQ/LQX[LVGHYLFH

GULYHUFRGH

7KHUHLVDORWRIFRGHLQYROYHGEHFDXVHWKHUHLVDORWRIYDULHW\LQWKHKDUGZDUHGHYLFHVEHLQJDFFHVVHG,WLVD

QRWDEOHDFKLHYHPHQWRI8QL[WKDWWKLVJUHDWPXOWLSOLFLW\RIKDUGZDUHLVEURXJKWXQGHUWKHFRQWURORIDVPDOO

UHSHUWRLUHRIVLPSOHFRPPDQGV$QLPSRUWDQWVWDJHLQWKHGHYHORSPHQWRIWKLVUHSHUWRLUHZDVWKHFRQFHSWRI

DGHYLFHLQGHSHQGHQWILOH

'HYLFH,QGHSHQGHQW)LOHV

7RXQGHUVWDQGZKDWGHYLFHLQGHSHQGHQFHPHDQVLWLVXVHIXOWRFRQVLGHUKRZZHPLJKWQDLYHO\EHJLQWR

7DEOH5RWDWH,QVWUXFWLRQVRQ$/ &) 

%HIRUH

6KLIW

$IWHU

$/5HJLVWHU

&)

&RPPDQG

$/5HJLVWHU

&)





525$/









52/$/









5&5$/









5&/$/





7RXQGHUVWDQGZKDWGHYLFHLQGHSHQGHQFHPHDQVLWLVXVHIXOWRFRQVLGHUKRZZHPLJKWQDLYHO\EHJLQWR

SURJUDPDFFHVVWRDQRUGLQDU\0HJIORSS\GULYHZLWKRXWWKHDLGRIWKLVXVHIXOFRQFHSW

)ORSS\'ULYH&RQWUROOHU

$IORSS\GULYHLQFOXGHVDPRWRUDQGDVHQVLQJDUPDQGLVFRQWUROOHGE\DSURFHVVRUFDOOHGDIORSS\GULYH

FRQWUROOHU6HH

)LJXUH

0DQ\IORSS\GULYHFRQWUROOHUVDUHFRPSDWLEOHZLWKWKHFRQWUROOHU,QWKH

,6$DUFKLWHFWXUHWKHFRPSDWLEOHFRQWUROOHULVDVVLJQHG,2SRUWV)2+WKURXJK)+$FFHVVWRWKH

IORSS\LVE\ZD\RIWKHVHSRUWV

)LJXUH7KH)ORSS\'ULYHDVDQ,2'HYLFH

$0HJIORSS\LVFDUYHGXSLQWRVPDOOSRUWLRQVE\WKHIORSS\GULYH(DFKVLGHRIWKHIORSS\KDV

FRQFHQWULFFLUFOHVOLNHWKHULQJVRIDWDUJHW7KHVHULQJVDUHFDOOHGWUDFNV(DFKVLGHLVDOVRGLYLGHGE\UDGLL

LQWRSLHFHVZKLFKDUHVKDSHGOLNHSL]]DVOLFHV(DFKWUDFNPRYHVWKURXJKDOORIWKHVHSL]]DVOLFHV(DFK

SRUWLRQRIRQHWUDFNRQRQHSL]]DVOLFHLVFDOOHGDVHFWRU(DFKVHFWRUFRQWDLQVE\WHVRIGDWD7KHWRWDO

FDSDFLW\RIWKHGLVNLV

7RJHWUHDGRUZULWHDFFHVVWRWKHGLVNDFRPPDQGPXVWEHLVVXHGWRWKH7KHFRPPDQGSRUWLVDWWKH

,6$DGGUHVV)++LVD5($'FRPPDQGLQWKHODQJXDJH,WPXVWEHIROORZHGE\HLJKWE\WHV

ZKLFKVSHFLI\DPRQJRWKHUWKLQJVZKLFKWUDFNZKLFKVHFWRUDQGZKLFKVLGHRIWKHGLVNZLOOEHUHDG$OO

UHDGFRPPDQGVUHDGDWOHDVWRQHIXOOVHFWRU7RUHDGVHFWRUQXPEHUILYHRQF\OLQGHUQXPEHUVL[RQVLGH

QXPEHURQHIRUH[DPSOHWKHIROORZLQJ

287

LQVWUXFWLRQVZRXOGQHHGWREHLVVXHG

$OWKRXJKWKLVFRGHDFFHVVHVE\WHVDOLWWOHDULWKPHWLFVKRZVWKDWIURPDSURFHVVRU VSRLQWRIYLHZLWLV

QRWDFFHVVHGDOODWRQFH6SLQQLQJDWUSPRUILYHUHYROXWLRQVSHUVHFRQGDIORSS\GULYHGULYHFDQFROOHFW

7KLVPHDQVE\WHVDUHFROOHFWHGHYHU\VHFRQGVRUPLFURVHFRQGV2QD0+]PDFKLQHWKLVLV

DZDLWRIPDFKLQHF\FOHVFOHDUO\WRRPXFKWLPHWRNHHSWKHSURFHVVRULGOLQJ7KLVLVDJRRGH[DPSOH

RIDVLWXDWLRQZKHUHDQLQWHUUXSWFDQVDYHWLPH(DFKWLPHWKHKDVDFFXPXODWHGRQHE\WHRILQIRUPDWLRQ

IURP

3URJUDP

029$/+'DWD5HDGFRPPDQG

287>)+@$/

287>)+@$/

029$/6LGH'ULYH$

287>)+@$/

029$/7KH&\OLQGHUQXPEHU

287>)+@$/

029$/6LGHDJDLQ

287>)+@$/

029$/7KH6HFWRUQXPEHU

287>)+@$/

029$/6HFWRUVL]HFRGHIRUE\WHV

287>)+@$/

029$//DVW6HFWRUQXPEHU

287>)+@$/

029$/*DSVL]H

287>)+@$/

029$/2))+8QXVHGVSHFLDO6HFWRUVL]HFRGH

287>)+@$/

WKHIORSS\GULYHLWVLJQDOVWKHV\VWHPWRWDNHWKHLQIRUPDWLRQ,WPD\XVH,54WRGRWKLV,Q

VHFWLRQ

ZHZLOOILQGWKDWDQRWKHUZD\RIKDQGOLQJWKHLQSXWKDVEHHQGHYHORSHGZKLFKLVHYHQOHVVZDVWHIXORI

SURFHVVRUWLPH

%DG2OG)LOHV

7KHIDFWWKDWLQIRUPDWLRQLVKDQGOHGXVLQJDEVROXWHDGGUHVVHVRQHVHFWRUDWDWLPHVWDQGVRXWLQRXU

SURJUDPPLQJRIWKHIORSS\GULYH6SDFHRQWKHGLVNLVXVHGLQFKXQNVRIE\WHV,WZRXOGEHYHU\QDWXUDO

WKHQLIDOO0HJIORSS\GLVNILOHVKDGOHQJWKVZKLFKZHUHPXOWLSOHVRIE\WHVDQGZHUHUHIHUHQFHG

XVLQJWKHDEVROXWHDGGUHVVHVRIWKHVHFWRUVZKLFKWKH\RFFXSLHG,WZRXOGDOVREHQDWXUDOWRVWRUHWKH

LQIRUPDWLRQDERXWZKLFKVHFWRUVZHUHRFFXSLHGLQWRWKHILOHDORQJZLWKWKHUHVWRIWKHLQIRUPDWLRQ7KLV

NLQGRILQIRUPDWLRQFRQVWLWXWHGZKDWZDVFDOOHGDILOHFRQWUROEORFN,Q8QL[WKLVNLQGRILQIRUPDWLRQLVKHOG

E\WKHV\VWHPLQVSHFLDOV\VWHPPHPRU\DUHDVFDOOHGLQRGHVDQGLVQRWLQWHJUDWHGZLWKWKHGDWDLQWKHILOH

:KHQWKLVNLQGRILQIRUPDWLRQLVLQFOXGHGDVDSDUWRIWKHGDWDHOHPHQWDU\RSHUDWLRQVVXFKDVFRS\LQJDILOH

IURPRQHGHYLFHWRDQRWKHUEHFRPHSUREOHPDWLF)LOHFRS\LQJSURJUDPVEHFRPHGHYLFHVSHFLILFMXVWDV

SURJUDPVWRFRQYHUWZRUGSURFHVVRUGRFXPHQWVDUHVRIWZDUHSDFNDJHVSHFLILF&RS\LQJDILOHFDQHDVLO\

FKDQJHLWVOHQJWKIRUH[DPSOH5HVLGXDOSUREOHPVRIH[DFWO\WKLVQDWXUHH[LVWLQFRQQHFWLRQZLWKWH[WILOHVLQ

&ZKHUHOLQHERXQGDULHVPD\EHPDUNHGHLWKHUE\V\VWHPLQIRUPDWLRQ²WKHGHYLFHKROGLQJWKHILOHPD\

KDYHDQLQWULQVLFOLQHVWUXFWXUH²RUE\HQGRIOLQHFKDUDFWHUV?QZKLFKDUHLQWHUQDOWRWKHGDWDILOH&RS\LQJ

WH[WILOHVLQ&LVQRWJXDUDQWHHGWRSUHVHUYHOHQJWK2QHUHDVRQWKDWWKH&SUHSURFHVVRUFRQFDWHQDWHVVWULQJV

LVVRWKDWLQWULQVLFHQGRIOLQHERXQGDULHVFDQEHRYHUFRPH7KH6WDQGDUG&/LEUDU\E\-LP3ODXJHULWVWLWOH

QRWZLWKVWDQGLQJFRQWDLQVVRPHIDVFLQDWLQJKLVWRULFDODVLGHVRQWKHVHLVVXHV

7KHSRLQWKHUHLVWKDWWKHVH

EDGROGILOHV

DUHVKDSHGE\WKHGHYLFHVRQZKLFKWKH\DUHVWRUHG$GHYLFH

LQGHSHQGHQWILOHRQWKHRWKHUKDQGEHDUVQRLPSULQWRIWKHGHYLFHRQZKLFKLWLVVWRUHG$GHYLFH

LQGHSHQGHQWILOHFDQEHFRSLHGIURPRQHGHYLFHWRDQRWKHUZLWKRXWXQGHUJRLQJFKDQJH'HYLFHLQGHSHQGHQW

ILOHVRULJLQDWHGLQWKH0XOWLFVRSHUDWLQJV\VWHPWKHLPPHGLDWHSUHGHFHVVRURI8QL[

 'LUHFW0HPRU\$FFHVV

7KHUHDGHULQWHUHVWHGLQJHWWLQJRQWRGHYLFHGULYHUVPD\VNLSDKHDGWR

VHFWLRQ

7KHUHDGHUFXULRXV

DERXWZKDWNHHSVWKHIORSS\GULYHRURWKHUSHULSKHUDOVIRUWKDWPDWWHUIURPLQWHUUXSWLQJWKHSURFHVVRUDIWHU

HYHU\IHWFKHGE\WHVKRXOGUHDGWKHQH[WWZRSDUDJUDSKV

,QDGGLWLRQWRWKH,54OLQHWKHDOVRKDVDQRXWSXWOLQHFDOOHG'0$54IRU'0$UHTXHVW'0$VWDQGV

IRUGLUHFWPHPRU\DFFHVV,QVWHDGRIXVLQJWKH,54OLQHWKHPD\EHSURJUDPPHGWRXVHWKH'0$54

OLQHLQVWHDG7KH'0$54OLQHUXQVIURPWKHWRDSURFHVVRUFDOOHGD'0$FRQWUROOHUZKLFKLVHTXLSSHG

WRLVVXHEXVFRQWUROVLJQDOVDQGWKXVLQLWLDWH0HPRU\:ULWHEXVF\FOHV,WFDQWKHUHIRUHUHOLHYHWKH&38RI

WKHWDVNRIWUDQVIHUULQJE\WHVRQHDWDWLPHIURPWKHIORSS\GULYHLQWRPHPRU\,QRUGHUWKDWWKHXVHRIWKH

EXVF\FOHPDFKLQHU\E\WKH'0$FRQWUROOHUQRWLQWHUIHUHZLWKWKH&38ZKLFKLVFRQVWDQWO\XVLQJWKHEXVHV

WRIHWFKLQVWUXFWLRQVWKHUHLVD+2/'OLQHUXQQLQJIURPWKH'0$FRQWUROOHUWRWKH&38DQGD+2/'$

KROGDFNQRZOHGJHOLQHUXQQLQJIURPWKH&38WRWKH'0$FRQWUROOHU7RXVHWKHEXVHVWKH'0$

FRQWUROOHUPXVWDVNIRUSHUPLVVLRQXVLQJWKH+2/'OLQHDQGUHFHLYHLWRQWKH+2/'$OLQH,QFLGHQWDOO\WKH

SURJUDPPHUPD\LQVWUXFWWKH&38WRZLWKKROGSHUPLVVLRQE\XVLQJWKH

/2&.

SUHIL[

SURJUDPPHUPD\LQVWUXFWWKH&38WRZLWKKROGSHUPLVVLRQE\XVLQJWKH

/2&.

SUHIL[

6HWWLQJXSD'0$WUDQVIHUUHTXLUHVPRUHZRUNRQWKHSDUWRIWKHSURJUDPPHUWKDQVHWWLQJXSDE\WH

UHDG&RPPDQGVPXVWEHLVVXHGWRERWKWKH'0$FRQWUROOHUDQGWKHIORSS\FRQWUROOHUEXWLWUHVXOWVLQ

VDYLQJDJUHDWGHDORI&38WLPH

6LQFHDQ\GHYLFHZKLFKWUDQVIHUVEORFNVRIGDWDWRDQGIURPPHPRU\FDQWDNHDGYDQWDJHRI'0$VHUYLFHWR

DYRLGSODFLQJXQQHFHVVDU\GHPDQGVRQWKHSURFHVVRUD'0$KDQGOLQJFLUFXLWYHU\VLPLODUWRWKHLQWHUUXSW

KDQGOLQJFLUFXLWVKRZQLQ

)LJXUH

ZLWKD0DVWHUDQGD6ODYH'0$FRQWUROOHUH[LVWVLQWKH,6$

DUFKLWHFWXUH7KHUHLVD'0$54OLQHIRUHDFKGHYLFHZKLFKJHWV'0$VHUYLFH7KHVH'0$OLQHVDUHFDOOHG

'0$FKDQQHOV

)LJXUH)ORSS\&RQWUROOHU8VLQJ'0$LQVWHDGRIDQ,QWHUUXSW

'HYLFHVDV)LOHV

$GHYLFHLQGHSHQGHQWILOHLVDOLVWRIE\WHVZLWKDQDPHDQGWKDW VDOOLWLV$VVXFKLWLVDQDEVWUDFWLRQ,W

VRRQSURYHGWREHDYHU\XVHIXODEVWUDFWLRQ,PPHGLDWHO\LQWKHZDNHRIWKHGHYLFHLQGHSHQGHQWILOHFRQFHSW

IROORZHGDQRWKHULQQRYDWLRQRIWKH0XOWLFVRSHUDWLQJV\VWHP7KLVZDVWKHLGHDWKDWLWVKRXOGEHSRVVLEOHIRU

DSURJUDPPHUWRWUHDW,2GHYLFHVSULQWHUVWHUPLQDOVHWFDVGHYLFHLQGHSHQGHQWILOHV7KLVLGHDLVWKH

EDVLVRIWKH8QL[GHYLFHGULYHU,QSXWWLQJGDWDIURPDGHYLFHFDQWKHQEHGRQHMXVWDV\RXZRXOGUHDGIURP

DILOH2XWSXWLQJGDWDWRDGHYLFHFDQEHGRQHMXVWDV\RXZRXOGZULWHWRDILOH7XUQLQJILOHRSHUDWLRQVLQWR

JHQHULFGHYLFHRSHUDWLRQVPDNHVXVLQJGHYLFHVHDV\IRUWKHDSSOLFDWLRQVSURJUDPPHUDQGDOVRFODULILHVWKH

UROHRIWKHGHYLFHGULYHU,WVUROHLVWRSURYLGHWKHNHUQHOZLWKGHYLFHVSHFLILFYHUVLRQVRI

UHDGZULWH

RSHQ

HWFWKDWFDQEHDFFHVVHGZKHQLWLVSURFHVVLQJWKRVHJHQHULFV\VWHPFDOOVZKLFKFRPHIURPXVHU

SURJUDPV

)RUH[DPSOHLQ

VHFWLRQ

ZKHUHD0RUVHFRGHVSHDNHUGHYLFHLVGHILQHGWKHIXQFWLRQ

FTBZULWH

LV

GHILQHG7KLVIXQFWLRQLVFDOOHGE\WKHNHUQHOZKHQWKHV\VWHPFDOO

ZULWH

LVXVHGWRDFFHVVWKH0RUVH

&RGHVSHDNHU7KLVPLJKWKDSSHQIRUH[DPSOHZKHQDXVHUVHQGVDVWULQJRIWH[WWRWKHVSHDNHU

OLQX[ER[HFKR+HOORZRUOG!GHYFT

%HFDXVHPRVWGHYLFHVDUHLGLRV\QFUDWLFLQDWOHDVWVRPHUHVSHFWRURWKHUWKHUHPXVWEHURRPOHIWRYHUIRU

IHDWXUHVWKDWGRQRWILWLQWRWKHJHQHULFUHDGDQGZULWHW\SHV\VWHPFDOOV7KHV\VWHPFDOO

LRFWO

LV

GHVLJQHGWRWDNHFDUHRIWKHVHOHIWRYHUV(DFKLGLRV\QFUDWLFIHDWXUHLVDVVLJQHGDXQLTXHQXPEHUFDOOHGD

PDJLFQXPEHU$QLGLRV\QFUDWLFIHDWXUHRIWKHVSHDNHUIRUH[DPSOHLVLWVSLWFK:KHQ

LRFWO

FDOOVWKH

VSHDNHUIXQFWLRQFTBLRFWOXVLQJWKHFRUUHFWPDJLFQXPEHUWKHSLWFKVHWWLQJIXQFWLRQLVFDOOHG

7KHFRQQRWDWLRQVRIWKHWHUPPDJLFQXPEHUDUHXQIRUWXQDWHSXWWLQJDVWKH\GRDQDXUDRIP\VWHU\DURXQGD

PHUHGHWDLODQGYDOXHRQSULYLOHJHGLQIRUPDWLRQZKHUHDYDOXHRQRSHQQHVVZRXOGEHPRUHVRFLDOO\

UHVSRQVLEOH6WXSLGQXPEHUZRXOGEHEHWWHU%XWEHWKDWDVLWPD\PDJLFQXPEHUVDUHDWOHDVWQRWKDUGWR

ILQG7KH\DUHE\FRQYHQWLRQJLYHQLQGHILQHVWDWHPHQWVZKHUHWKHLUXVDJHLVH[SODLQHG326,;

FRQYHQWLRQVUHTXLUHWKDWPDJLFQXPEHUVEHQRWRQO\XQLTXHIRUDGHYLFHEXWV\VWHPZLGHXQLTXH

,QWKHIROORZLQJVHFWLRQVWZRH[DPSOHVRIGHYLFHGULYHUVDUHSUHVHQWHG7KHSXUSRVHRIWKHVHH[DPSOHVLVWR

VKRZZKDWLVLQYROYHGLQZULWLQJDGHYLFHGULYHUZKLFKLQFRUSRUDWHVVRPHDVVHPEO\FRGH7KHILUVWGULYHULV

DWR\,WVUHDVRQIRUH[LVWHQFHLVWRVHUYHDVDQH[DPSOHRIDGHYLFHGULYHU7KHVHFRQGGULYHUZDVZULWWHQLQ

UHVSRQVHWRDUHTXHVWIURPDIULHQGZKRQHHGHGWRLQSXWGDWDIURPDQH[WHUQDOGHYLFHDVSDUWRIDUHVHDUFK

SURMHFWLQYROYLQJWKHPHDVXUHPHQWRIOL]DUGPHWDEROLFUDWHV7KHJRDORIWKHUHVHDUFKLVDEHWWHU

XQGHUVWDQGLQJWKHPHFKDQLVPE\ZKLFKHQYLURQPHQWDOYDULDWLRQVEULQJDERXWOL]DUGVSHFLDWLRQDQGDOVR

H[WLQFWLRQV6RDOWKRXJKLWLVQRWDELJSURJUDPLWLVQRWMXVWDWR\7KHPDLQIHDWXUHWKHVHFRQGGULYHUKDV

WKDWWKHILUVWRQHGRHVQRWKDYHLVWKDWLWLQVWDOOVLWVRZQLQWHUUXSWKDQGOHU7KH0RUVH&RGHGULYHUPHUHO\

DGGVVRPHFKRUHVWRWKRVHRIDQDOUHDG\LQVWDOOHGKDQGOHU

0RUVH&RGH6SHDNHU'ULYHU

7KHEDVLFVWUXFWXUHZKLFKLVXVHGWRFRQQHFWGHYLFHVSHFLILFIXQFWLRQVVXFKDV

FTBZULWH

ZLWKWKHLU

JHQHULFFRXQWHUSDUWVVXFKDV

ZULWH

LVWKHILOHRSHUDWLRQVVWUXFWXUH

7KH

ILOHBRSHUDWLRQV

6WUXFWXUH

7KHGHILQLWLRQRIWKLVVWUXFWXUHLVLQ

XVUVUFOLQX[LQFOXGHOLQX[IVK

$VLPSOLILHGYHUVLRQRILWLV

JLYHQKHUH

VWUXFWILOHBRSHUDWLRQV

^

ORQJORQJ OOVHHN

LQW UHDG

LQW ZULWH

LQW UHDGGLU

LQW SROO

LQW LRFWO

LQW PPDS

LQW RSHQ

LQW IOXVK

LQW UHOHDVH

LQW IV\QF

LQW IDV\QF

LQW FKHFNBPHGLDBFKDQJH

LQW UHYDOLGDWH

LQW ORFN

`

$OOWKHFRPSRQHQWVRIWKLVVWUXFWXUHDUHSRLQWHUVWRIXQFWLRQV7KHIXQFWLRQQDPHVDUHJLYHQH[DFWO\EXW

WKHLUSDUDPHWHUGHFODUDWLRQVDUHRPLWWHGDQGWKHUHWXUQW\SHVDUHJLYHQXVLQJDIDPLOLDUEXWQRQSRUWDEOH[

YHUVLRQHJ

LQW

LQVWHDGRIWKHPRUHSRUWDEOH

VVL]HBW

7KHXVHRIW\SHVVXFKDV

VVL]HBW

KRZHYHU

YDOXDEOHIRUWKHVDNHRIJHWWLQJWKHVDPHFRGHWRFRPSLOHDQGUXQRQGLIIHUHQWDUFKLWHFWXUHVKDVDVHULRXV

GRZQVLGHZKHQLWFRPHVWRUHDGLQJWKHFRGH)RUH[DPSOHWRFKDVHGRZQWKHGHILQLWLRQRI

VVL]HBW

ZH

QHHGWRILQG

W\SHGHIBBNHUQHOBVVL]HBWVVL]HBW

LQ

XVUVUFOLQX[LQFOXGHOLQX[W\SHVK

DQGWKHQ

W\SHGHILQWBBNHUQHOBVVL]HBW

LQ

XVUVUFOLQX[LQFOXGHDVPLSRVL[BW\SHVK

/HDUQLQJDQRSHUDWLQJV\VWHPVKRXOGQRWWXUQ

LQWRDQH[HUFLVHLQXVLQJWKH

JUHS

FRPPDQG

7KHFUHDWLRQRIDQLQVWDQFHRI

VWUXFWILOHRSHUDWLRQV

IRUDSDUWLFXODUGHYLFHLVWKHNH\WRZULWLQJD

GHYLFHGULYHU7KHELJJHVWSDUWRIZULWLQJWKHGULYHULVGHILQLQJWKHIXQFWLRQVLQWKLVVWUXFWXUH7KHVH

IXQFWLRQVKDQGOHWKHV\VWHPFDOOVZKLFKUHVXOWLQFDOOVIURPWKHV\VWHPWRWKHGHYLFH+DQGOLQJFDOOVIURPWKH

GHYLFHWRWKHV\VWHPUHTXLUHVVHWWLQJXSDQLQWHUUXSWKDQGOHURUDVLQWKHFDVHRIWKH0RUVH&RGHVSHDNHU

GULYHUSLJJ\EDFNLQJRIIRIDQH[LVWLQJLQWHUUXSWKDQGOHU1RWDOORIWKHIXQFWLRQVQDPHGLQWKH

VWUXFW

ILOHBRSHUDWLRQV

VWUXFWXUHDUHQHHGHGLQHYHU\GHYLFH8QQHHGHGFRPSRQHQWVPD\VLPSO\EHGHILQHGDV

ILOHBRSHUDWLRQV

VWUXFWXUHDUHQHHGHGLQHYHU\GHYLFH8QQHHGHGFRPSRQHQWVPD\VLPSO\EHGHILQHGDV

18//

)RUWKH0RUVH&RGHGULYHUWKHIROORZLQJGHFODUDWLRQVHWVXSWKHQHHGHGILOHRSHUDWLRQVVWUXFWXUH

VWDWLFVWUXFWILOHBRSHUDWLRQVFTBIRSV

^

FTBOVHHN

18// FTBUHDG 

FTBZULWH

18// FTBUHDGGLU 

18// FTSROO 

FTBLRFWO

18// FTBPPDS 

FTBRSHQ

18// FTIOXVK 

FTBUHOHDVH

`

7KHFRGLQJIRUWKHVHFRPSRQHQWIXQFWLRQVLVJLYHQLQ

VHFWLRQ

7KHRPLWWHGFRPSRQHQWVIROORZLQJ

FTBUHOHDVH

PD\EHVDIHO\OHIWWRJFFZKLFKILOOVWKHPLQZLWKWKHYDOXH

18//

3URJUDP

YRLGGHOD\LQWL

^

 9(5<URXJKO\GHOD\E\LKXQGUHGWKVRIDVHFRQG 

L L  0XOWLSO\E\DPLOOLRQ 

ZKLOHL!L L &RXOGEHMXVWRQHLQVWUXFWLRQ 

 0DQ\LQVWUXFWLRQVWDNHMXVWRQHFORFNF\FOH 

 2QD0+]PDFKLQHRQHPLOOLRQFORFNF\FOHVWDNHVHF 

`

7LPLQJ8VLQJ'HOD\/RRSV

%HIRUHJHWWLQJLQWRWKHGHWDLOVRIWKHLQGLYLGXDOIXQFWLRQVKRZHYHULWZRXOGEHZRUWKZKLOHWRWDNHDQ

RYHUYLHZRIKRZWKHZKROHWKLQJZRUNV,QDQXQSURWHFWHGVLQJOHXVHUV\VWHPVXFKDVLQ'26IRUH[DPSOH

ZHFRXOGWXUQWKHVSHDNHURQDQGRIIDWZLOOXVLQJ

,1

DQG

287

LQVWUXFWLRQV7KHWLPLQJRIWKHRQVDQGRIIV

FRXOGEHPDQDJHGXVLQJGHOD\ORRSVDVVKRZQLQ

3URJUDP

7KHWLPHVSHQWLQWKHVHGHOD\ORRSVZRXOG

QRWEHDELJSUREOHPVLQFHDVDVLQJOHXVHUV\VWHPWKHPDFKLQHZRXOGSUREDEO\QRWEHGRLQJDQ\WKLQJHOVH

DQ\ZD\

:HFRXOGDOVRXVHWKLVWHFKQLTXHLQD/LQX[GHYLFHGULYHU7KHUHLVQRWKLQJWRVWRSXV

3URJUDP

VKRZV

WKHUHVXOW+RZHYHULQD/LQX[GHYLFHGULYHUWKLVFRGHZRXOGEHWHUULEOH/LQX[GRHVQRWLQWHUUXSWNHUQHO

FRGH6LQFHGHYLFHGULYHUVDUHSDUWRIWKHNHUQHOWKLVFRGHZRXOGQHYHUJHWWLPHGRXW,WZRXOGPRQRSROL]H

WKHV\VWHP

,QVWHDGRIVWUDQJOLQJWKHFRPSXWHUWKHGULYHUQHHGVWROHWJRRIWKH&38DQGUHVFKHGXOHLWVHOIIRUH[HFXWLRQ

DWDODWHUWLPH7KHGULYHUFDQGRWKLVE\WDNLQJDGYDQWDJHRIH[LVWLQJ/LQX[V\VWHPUHVRXUFHVLQWKLVFDVH

WKHV\VWHPWLPHU7KHV\VWHPWLPHULVDFORFNZKLFKLQWHUUXSWVWKHSURFHVVRUHYHU\VHFRQG,WXVHV,54

,Q/LQX[DOOLQWHUUXSWVDUHFRXQWHGDQGWKHFRXQWVDUHGLVSOD\HGLQWKH

SURFLQWHUUXSWV

GLUHFWRU\

7KHFRXQWHUIRUWKHWLPHULQWHUUXSWLVFDOOHG

MLIILHV

DQGLWVYDOXHLVGLVSOD\HGDORQJZLWKWKHRWKHULQWHUUXSW

FRXQWV:KHQWKH,65IRUWKLVLQWHUUXSWH[HFXWHVLWFKHFNVDTXHXHRIMREVZKLFKKDYHDVFKHGXOHGH[HFXWLRQ

WLPH7KLVTXHXHLVFDOOHGWKHWLPHUTXHXH

7KH7LPHU4XHXH

8VLQJWKHWLPHUTXHXHLVQRWGLIILFXOW(DFKWLPHUTXHXHHQWU\LVOLNHDKDQG\OLWWOHRUGHUIRUP,WKDV

VWUXFWXUHVKRZQLQ

)LJXUH

:KHQVXEPLWWLQJDQRUGHU\RXILOOLQWKHODVWWKUHHLWHPVDQGOHDYHWKHILUVW

WZREODQN

)LJXUH'HILQLWLRQRIWKH7LPHU4XHXH

)LJXUH'HILQLWLRQRIWKH7LPHU4XHXH

3URJUDP

ZKLOH&RGHQRWGRQH!

^

LI'RWVWDUWV!

^

VSHDNHUBRQ

GWLPH 

`

HOVHLI'DVKVWDUWV!

^

VSHDNHUBRQ

GWLPH 

`

HOVHLI'RWRU'DVKVWRSV!

^

VSHDNHUBRII

GWLPH 

`

GHOD\GWLPH

 GWLPHLVKRZORQJWRUXQWKHGHOD\ORRS 

`

z

QH[W

DQG

SUHY

DUHW\SLFDOGRXEO\OLQNHGOLVWSRLQWHUV2QDVXEPLWWHGMREWKH\VKRXOGEHVHWWR

18//

7KH\DUHUHVHWODWHUE\/LQX[ZKHQWKHHQWU\LVOLQNHGLQWRWKHWLPHUTXHXH

z

H[SLUHV

LVWKHWLPHLQ

MLIILHV

ZKHQWKHMRELVVXSSRVHGWREHJLQH[HFXWLQJ

z

7KH

IXQFWLRQ

FRPSRQHQWLVWKHMREWREHGRQH$VLWVQDPHLPSOLHVLWLVMXVWDSRLQWHUWRDIXQFWLRQ

:KHQWKHWLPHVSHFLILHGLQ

H[SLUHV

DUULYHVWKHIXQFWLRQSRLQWHGDWE\

IXQFWLRQ

JHWVFDOOHG

z

7KH

GDWD

FRPSRQHQWLVWKHDUJXPHQWSDVVHGWRWKHIXQFWLRQSRLQWHGDWE\

IXQFWLRQ

7RVXEPLWRQHRIWKHVHRUGHUIRUPVWR/LQX[\RXFDOOWKHDGGBWLPHUIXQFWLRQRQDSRLQWHUWRLW7KDW VDOO

WKHUHLVWRXVLQJWKHWLPHUTXHXH

3URJUDP

YRLGFTBWLPHUBKDQGOHUXQVLJQHGORQJ[

^

XQVLJQHGORQJGWLPH

XQVLJQHGORQJGWLPH

 GWLPHLVKRZORQJWRZDLWRQWKHWLPHUTXHXH

LI&RGHQRWGRQH!

^

LI'RWVWDUWV!

^

VSHDNHUBRQ

GWLPH 

`

HOVHLI'DVKVWDUWV!

^

VSHDNHUBRQ

GWLPH 

`

HOVHLI'RWRU'DVKVWRSV!

^

VSHDNHUBRII

GWLPH 

`

FTBWLPHU!H[SLUHV MLIILHVGWLPH

FTBWLPHU!IXQFWLRQ FTBWLPHUKDQGOHU

 +HUHFTBWLPHUBKDQGOHULVDGGLQJLWV

RZQQDPHWRWKHWLPHUTXHXHHQWU\IRUP 

DGGBWLPHU FTBWLPHU

 1RZVXEPLWWKHTXHXHHQWU\ 

`

`

,IZHXVHWKHWLPHUTXHXHWRIL[

3URJUDP



3URJUDP

UHVXOWV,WLVHVVHQWLDOO\WKHVDPHDV

3URJUDP



H[FHSWWKDWLWH[LWVSURPSWO\DIWHULWWXUQVWKHVSHDNHURQRURIILQVWHDGRIKRJJLQJWKH&38,WUHOLHVRQ

WKHWLPHULQWHUUXSWWRJHWLWVHOIFDOOHGDJDLQODWHU7KH

GDWD

FRPSRQHQWRIWKH

VWUXFWWLPHUBOLVW

VWUXFWXUH

LVQRWXVHG2QFHWKLVFRGHLVFDOOHGLWXVHVWKHWLPHUWRFDOOLWVHOIEDFNDJDLQ,WLVDOLWWOHOLNHUHFXUVLRQ

H[FHSWWKDWLWGRHVQRWFDOOLWVHOIGLUHFWO\EXWLQGLUHFWO\E\VHQGLQJLWVQDPHWRWKHWLPHUTXHXH6LQFHDQ\

IXQFWLRQFDQDGGWKLVHQWU\WRWKHWLPHUTXHXHWKHUHLVQRSUREOHPJHWWLQJLWVWDUWHG,QIDFWWKLVLVGRQHE\

FTBZULWH

'HYLFH0HPRU\

7KHQH[WSUREOHPZHIDFHLQZULWLQJWKLVGULYHULVPHPRU\DFFHVV7KHPHPRU\ODEHOVYDULDEOHQDPHVDQG

IXQFWLRQQDPHVXVHGLQ

3URJUDP

DUHUHIHUHQFHGZKHQWKH,65IRULQWHUUXSWLVH[HFXWHG7KLV

LQWHUUXSWPD\RFFXUGXULQJWKHUXQQLQJRIDQ\SURFHVV7KHSDJHWDEOHVLQHIIHFWDWWKDWWLPHDUHWKRVH

EHORQJLQJWRZKDWHYHUSURFHVVKDSSHQVWREHUXQQLQJDWWKDWWLPH,WQHHGQRWEHWKHSURFHVVWKDWLVVHQGLQJ

WH[WWRWKHVSHDNHU

1RWHWKDWLQWKHXQFRGHGSRUWLRQVRI

3URJUDP

VXFKDV'RWVWDUWV!RU&RGHQRWGRQH!WKHUHPXVWEH

UHIHUHQFHVWRWKHWH[WEHLQJVHQWWRWKHVSHDNHU7KLVWH[WLVORFDWHGLQPHPRU\EHORQJLQJWRWKHSURFHVV

ZKLFKRULJLQDOO\FDOOHGWKHGHYLFHGULYHU+RZHYHUJHWWLQJDFFHVVWRWKLVPHPRU\LVDSUREOHP7KHSUREOHP

LVQRWDFFHVVULJKWVLWLVILQGLQJDXVDEOHDGGUHVV7KHRQO\DGGUHVVZHKDYHIRUWKLVWH[WLVGHILQHGUHODWLYH

WRDVHWRISDJHWDEOHVWKDWDUHSRLQWHGDWE\D&5YDOXHWKDWLVQRWORDGHGLQWR&5.HUQHOSULYLOHJHVGR

QRWVROYHWKLVSUREOHP'RLQJDWDVNVZLWFKEDFNWRWKHFDOOLQJSURFHVVZRXOGUHVWRUHWKH&5YDOXHQHHGHG

WRDFFHVVWKHSDJHWDEOHVEXWLIDOOZHQHHGWRGRLVWRWXUQWKHVSHDNHURQRURIIWKHQWKLVZRXOGEHD

ULGLFXORXVZDVWHRIWLPH

$JRRGVROXWLRQWRWKLVSUREOHPLVWRVHWDVLGHVRPHNHUQHOPHPRU\IRUWKHGHYLFHDQGKDYH

FTBZULWH

FRS\IURPWKHXVHU VPHPRU\LQWRWKHGHYLFH VPHPRU\8QOLNH

FTBWLPHUBKDQGOHUFTBZULWH

LV

FDOOHGLQUHVSRQVHWRDXVHU VV\VWHPFDOODQGH[HFXWHVZKLOHWKHXVHU VSDJHWDEOHVDUHVWLOOLQHIIHFW$WWKDW

WLPHORFDWLQJWKHWH[WLVQRWDSUREOHP%XWOLNH

FTBWLPHUBKDQGOHU

LWH[HFXWHVZLWKNHUQHOSULYLOHJHVR

LWKDVWKHULJKWVQHHGHGWRDFFHVVNHUQHOPHPRU\

6LQFHNHUQHODGGUHVVHVDUHVKDUHGV\VWHPZLGHWKH\DUHYDOLGQRPDWWHUZKDWSURFHVVLVUXQQLQJ)RU

H[DPSOHZHFDQORRNXSWKHDGGUHVVRI

MLIILHV

RU

DGGBWLPHU

DQ\WLPHZHZDQWE\GRLQJD

JUHS

VXFKDV

OLQX[ER[JUHSMLIILHV6\VWHPPDS

(VVHQWLDOO\DOOGHYLFHVQHHGVRPHPHPRU\RIWKHLURZQLQRUGHUWRIXQFWLRQ7KHVWUXFWXUHZKRVHGHILQLWLRQ

LVVKRZQLQ

)LJXUH

VHWVDVLGHGHYLFHPHPRU\QHHGHGIRUWKHVSHDNHUGULYHU7KHFRPSRQHQWVRIWKLV

VWUXFWXUHDUH

)LJXUH'HYLFH0HPRU\IRU6SHDNHU

z

IODJV

7KHELWVRIWKHIODJVFDUU\LQIRUPDWLRQDERXWWKHVWDWHRIWKHGHYLFH

GHILQH&4B(;,67[

GHILQH&4B%86<[

GHILQH&4B2))[

7KH

&4B(;,67

ELWPHUHO\LQGLFDWHVWKDWWKHGHYLFHGULYHULVLQVWDOOHG7KH

&4B%86<

ELWLVXVHGWRNHHS

PRUHWKDQRQHSURFHVVIURPXVLQJWKHGHYLFHDWWKHVDPHWLPH7KLVELWLVFKHFNHGZKHQ

RSHQ

LV

FDOOHGRQWKHGHYLFH%ORFNLQJRWKHUSURFHVVHVIURPXVLQJ

GHYFT

GRHVQRWEORFNWKHPIURPXVLQJ

WKHVSHDNHU$FWUO*DEHHSVHQWWRWKHWHUPLQDOZLOOVWLOOJHWWKURXJK$WUXHVSHDNHUGHYLFHGULYHU

ZRXOGQRWOHWWKLVKDSSHQ$OONHUQHOFRGHDFFHVVLQJWKHVSHDNHUZRXOGEHUHURXWHGWKURXJKWKH

VSHDNHUGULYHU%XWVLQFHHPHUJHQF\FRGHQHHGVGLUHFWDFFHVVWRWKHVSHDNHUWKLVZRXOGQRWEH

GHVLUDEOH7KH

&4B2))

ELWLQGLFDWHVWKDWWKHGHYLFHGULYHUKDVWKHVSHDNHUWXUQHGRIIDWWKHPRPHQW

7KLVELWLVFKHFNHGHYHU\WLPH

FTBWLPHUBKDQGOHU

LVFDOOHG7KHVHGHILQLWLRQVDUHDOZD\VLQVHUWHG

LQWRDKHDGHUILOHDVVRFLDWHGZLWKWKHGHYLFH,QWKLVFDVHWKHILOHQDPH

FTK

LVPRUHRUOHVVLQHYLWDEOH

z

WLPHUGLY

7KH

WLPHUGLY

FRPSRQHQWKROGVWKHYDOXHRIWKHWLPHUGLYLVRUZKLFKGHWHUPLQHVWKHSLWFK

RIWKHVSHDNHU3XWWLQJWKLVQXPEHULQWRGHYLFHPHPRU\DOORZVWKHSLWFKWREHUHVHWHYHU\WLPHWKH

0RUVHVSHDNHULVXVHGWKXVSURWHFWLQJLWIURPEHLQJFKDQJHGE\DFWUO*IURPVRPHRWKHUSURFHVVDQG

VWLOOEHPRGLILDEOHXVLQJ

LRFWO

z

ZKROHQRWH

6LPLODUO\WKH

ZKROHQRWH

FRPSRQHQWKROGVDXQLWWLPHYDOXHWKDWLVXVHGDVWKHEDVLVIRU

FDOFXODWLQJDOOWKHRWKHUWLPHYDOXHVLQWKHSURJUDP$OWHULQJWKLVYDOXHFKDQJHVWKHRYHUDOOUDWHDW

ZKLFKWKH0RUVH&RGHFRPHVRXWRIWKHVSHDNHU,WLVJLYHQLQWHUPVRIWKHGXUDWLRQRIRQHPXVLFDO

ZKROHQRWH

z

EXIIHU>&4B%8))(5B6,=(@

7KHEXIIHU

EXIIHU>&4B%8))(5B6,=(@

KROGVWKHWH[WIURPWKHFDOOLQJ

SURFHVV7KLVLVWKHWH[WZKLFKLVLQWKHSURFHVVRIEHLQJVHQWWRWKHVSHDNHU7KHIDFWWKDWWH[WLVVWRUHG

KHUHLQNHUQHOPHPRU\LVZKDWPDNHVLWXQQHFHVVDU\WRGRDWDVNVZLWFKHYHU\WLPHWKHVSHDNHULV

UHDG\IRUDQRWKHUOHWWHU

z

PFRGH

7KHSRLQWHU

PFRGH

NHHSVWUDFNRIZKHUHLQWKHVWULQJRIGRWVDQGGDVKHVIRUWKHFXUUHQW

FKDUDFWHUZHDUH

z

EXIIHUBRIIVHW

7KH

EXIIHUBRIIVHW

FRPSRQHQWSLFNVRXWZKLFKFKDUDFWHULQWKHEXIIHUWKHVSHDNHU

LVFXUUHQWO\ZRUNLQJRQ

z

EXIIHUBHQG

7KH

EXIIHUBHQG

PDUNVWKHHQGRIWKHFXUUHQWEXIIHUORDG,WLVXVXDOO\MXVWWKHVDPHDV

z

EXIIHUBHQG

7KH

EXIIHUBHQG

PDUNVWKHHQGRIWKHFXUUHQWEXIIHUORDG,WLVXVXDOO\MXVWWKHVDPHDV

&4B%8))(5B6,=(

%XWLQFDVHWKHEXIIHULVJLYHQRQO\DSDUWLDOORDG

EXIIHUBHQG

DOORZVWKHGULYHUWR

TXLWRQWLPHZLWKRXWUXQQLQJDOOWKHZD\WRWKHHQGRIWKHEXIIHU

z

FTBZDLWBT

7KHODVWFRPSRQHQW

FTBZDLWBT

LVWKHUHEHFDXVHDOWKRXJKWKHWH[WEXIIHU

EXIIHU

>&4B%8))(5B6,=(@

LVDJRRGLGHDLWGRHVQRWFRPSOHWHO\VROYHWKHSUREOHPRIDFFHVVLQJWKHXVHU V

WH[W:KHQDOOWKHWH[WLQWKHEXIIHUKDVEHHQVHQWWRWKHVSHDNHUDQGWKHUHLVPRUHWRJRWKHQZH UH

EDFNZKHUHZHZHUHEHIRUHZKHQZHKDGQREXIIHUWU\LQJWRJHWDKROGRIXVHU VWH[WZKHQWKHXVHU V

SURFHVVLVQRWUXQQLQJDQGKHQFHWKHXVHU VDGGUHVVVSDFHLVQRWIXQFWLRQDO

7KHEXIIHULQGHYLFHPHPRU\GRHVQRWHOLPLQDWHWKHQHHGWRGRWDVNVZLWFKHV,WFDQRQO\UHGXFHWKHQXPEHU

RIWKHWKHP,WFDQGRWKLVE\PDNLQJWKHEXIIHUODUJHU7KHELJJHUWKHEXIIHUWKHOHVVRIWHQDWDVNVZLWFKLV

QHHGHG%XWDELJJHUEXIIHULQFUHDVHVWKHVL]HRINHUQHOPHPRU\:HKDYHKHUHDW\SLFDOWLPHYVVSDFHWUDGH

RII

7KHXVHUFDOOHGSURFHVVZKLFKILOOVWKHEXIIHUDQGWKHWLPHUKDQGOHUZKLFKHPSWLHVWKHEXIIHUDUHDQ

H[DPSOHRIZKDWLVFDOOHGDSURGXFHUFRQVXPHUSDLU

:DLW4XHXHV

:DLWTXHXHVZHUHGHVLJQHGWRDOORZSURFHVVHVWRVXVSHQGRSHUDWLRQLVVXFKDZD\WKDWWKH\FDQEHHDVLO\

UHDFWLYDWHGZKHQQHHGHG)RUH[DPSOHDSURGXFHUFDQVXVSHQGRSHUDWLRQZKHQLWKDVSURGXFHGDVXUSOXV

DQGEHUHDFWLYDWHGE\DFRQVXPHUZKHQWKHVXSSO\LVH[KDXVWHG

$SURFHVVPD\VXVSHQGLWVRZQRSHUDWLRQE\FDOOLQJ

VOHHSBRQ

,WFDQEHUHDFWLYDWHGXVLQJ

ZDNHBRQ

,QWKHFDVHRIRXUVSHDNHUGULYHUWKHSURGXFHU

FTBZULWH

ILOOV

FTBDUHDEXIIHU

WKHVSHDNHU VWH[WEXIIHU

DQGFRXOGFDOO

VOHHSBRQ

DVVRRQDVLWZDVGRQH:KHQWKHWLPHUKDQGOHU

FTBWLPHUBKDQGOHU

KDVXVHG

XSDEXIIHUORDGE\VHQGLQJLWRIIWRWKHVSHDNHULWFRXOGFDOOWKHIXQFWLRQ

ZDNHBXS

WRJHW

FTBZULWH

WR

ILOOWKHEXIIHUEDFNXSDJDLQ

)URPWKHQDPH

ZDNHBXS

ZHPLJKWJHWWKHLGHDWKDWDQLPPHGLDWHWDVNVZLWFKZRXOGEHLQLWLDWHG,QIDFW

ZKDWKDSSHQVLVWKDWWKHSURFHVVUXQQLQJ

FTBZULWH

JHWVSXWEDFNRQDTXHXHFDOOHGWKHUXQTXHXHZKLFK

FRQVLVWVRIDOOSURFHVVHVZKLFK

3URJUDP

FTBZULWH)LOH!XQ

^

 7KLVSURJUDPSXWVLWVHOIWRVOHHS

DIWHULWILOOVGHYLFHPHPRU\ 

LQWNWRWDO 

ZKLOHWRWDOQ

^

N &4B%8))(5B6,=(

FRS\BIURPBXVHUFTBDUHDEXIIHUNX

DGGBWLPHU FTBWLPHU 6WDUWWLPHUKDQGOHU 

WRWDO WRWDON

VOHHSBRQ FTBDUHDZDLWBT

`

`

FTBWLPHUBKDQGOHXQVLJQHGLQW[

^

 7KLVSURJUDPZDNHVXSWKHXVHU

SURFHVVZKHQGHYLFHPHPRU\LVHPSW\ 

7XUQVSHDNHURQRURII!

LI&KDUDFWHUGRQH!

^

FTBDUHDEXIIHUBRIIVHW FTBDUHDEXIIHUBRIIVHW

LIFTBDUHDEXIIHUBRIIVHW FTDUHDEXIIHUBHQG

LIFTBDUHDEXIIHUBRIIVHW FTDUHDEXIIHUBHQG

^

FTBDUHDEXIIHUBRIIVHW 

ZDNHBXS FTBDUHDZDLWBT

UHWXUQ 1RIXWXUHVFKHGXOLQJGRQHKHUH 

`

DGGBWLPHU FTBWLPHU &RQWLQXHFDOOLQJWLPHUKDQGOHU 

`

`

DUHFXUUHQWO\WDNLQJWXUQVXVLQJWKHSURFHVVRU(DFKWLPHDQRWKHUSURFHVVRQWKHUXQTXHXHWDNHVLWVWXUQRQ

WKHSURFHVVRUWKHUHKDVWREHDWDVNVZLWFKRIFRXUVH

%RWK

VOHHSBRQ

DQG

ZDNHBXS

PXVWEHFDOOHGRQDQDUJXPHQWZKRVHW\SHLV

VWUXFWZDLWBTXHXH 

DSRLQWHUWRWRDSRLQWHUWRDZDLWTXHXHVWUXFWXUH$OWKRXJKWKLVVRXQGVKRUULEOHLWLVUHDOO\QRSUREOHPWRVHW

XSRQHRIWKHVHWKLQJV7KHGHILQLWLRQRID

VWUXFWZDLWBTXHXH

LV

LQ

XVUVUFOLQX[LQFOXGHOLQX[ZDLWK

%XWDFWXDOO\WRXVHDZDLWTXHXHZHGRQ WQHHGWRNQRZDQ\WKLQJDERXWLWVLQWHUQDOV$VORQJDVZHFDOO

ZDNHBXS

RQWKHVDPHSRLQWHUWKDWZHJLYHWR

VOHHSBRQ

ZH UHDOOVHW7KH

ZDLWBT

FRPSRQHQWRIRXU

VWUXFWFTBVWUXFW

JLYHVXVDVLQJOHSRLQWHUWRDZDLWTXHXHVWUXFWXUH6LQFH

FTBZULWH

XVHV

VOHHSBRQ



DQG

FTBWLPHUBKDQGOHU

XVHV

ZDNHBXS

WKHQWKHZDLWTXHXHGRXEOHSRLQWHUPXVWEHORFDWHGLQD

SODFHZKHUHERWKIXQFWLRQVFDQDGGUHVVLW7KLVLVDQRWKHUH[DPSOHZKHUHGHYLFHPHPRU\FRPHVLQKDQG\

7KDWLVZK\WKHZDLWTXHXHSRLQWHULVORFDWHGWKHUH$SRLQWHUWRWKLVSRLQWHUWKHQJLYHVXVWKHDUJXPHQWWKDW

ZHQHHG

FTBDUHDZDLWBT

3URJUDP

VKRZVKRZWKH

VOHHSBRQ

DQG

ZDNHBXS

FDOOVZRUNWRJHWKHU,Q

3URJUDP



FTBZULWH



FDOOV

VOHHSBRQ

DVVRRQDVLWKDVILOOHGWKHGHYLFHEXIIHULQNHUQHOPHPRU\

FTBWLPHUBKDQGOH

ZDNHV

XSWKHVOHHSLQJ

FTBZULWH

SURFHVVZKHQLWKDVHPSWLHGWKHGHYLFHEXIIHU

1RZWKDWZHFDQSURJUDPWKHQHFHVVDU\WDVNVZLWFKHVZHDUHLQDSRVLWLRQWRZULWHDZRUNDEOHGULYHU

8QIRUWXQDWHO\WKHGULYHUDVRXWOLQHGVRIDUZRXOGKDYHDVHULRXVIDLOLQJ,WZRXOGQRWUHVSRQGWRZKDWDUH

FDOOHGVLJQDOV

6LJQDOV

3URFHVVHVLQ8QL[KDYHDKDQGIXORIGLIIHUHQWPHFKDQLVPVDYDLODEOHWRFRPPXQLFDWHZLWKHDFKRWKHU2QHRI

WKHVHLVWKHVHQGLQJRIVLJQDOV:KHQDSURFHVVLVNLOOHGZLWKDFWUO&RUD

NLOO

FRPPDQGWKHSURFHVVKDV

UHFHLYHGDVLJQDO7RH[SODLQZKDWDVLJQDOLVZHQHHGWRH[SDQGDOLWWOHRQWKHQRWLRQRIDWDVN:HKDYH

GHVFULEHGWKHWDVNVWDWHVHJPHQWDVDUHJLRQRIPHPRU\ZKHUHUHJLVWHUVJHWVDYHGZKHQDWDVNVZLWFKRFFXUV

7KHWDVNVWDWHVHJPHQWLVPDLQWDLQHGE\WKHKDUGZDUH%XWLWLVRQO\DSDUWRIWKHFRQWH[WXDOLQIRUPDWLRQWKDW

LVPDLQWDLQHGE\/LQX[IRUHDFKSURFHVV7KHUHLVDVWUXFWXUHFDOOHGD

VWUXFWWDVNBVWUXFW

GHILQHG

LQ

XVUVUFOLQX[LQFOXGHOLQX[VFKHGK

ZKLFKNHHSVDOOWKHLQIRUPDWLRQ/LQX[QHHGVRQDSURFHVV

7KLVLQIRUPDWLRQLVDYDLODEOHWRWKHGHYLFHGULYHUZKHQLWLVH[HFXWLQJLQEHKDOIRIDSURFHVVEHFDXVHWKHUHLV

DJOREDOYDULDEOHLQNHUQHOPHPRU\FDOOHG

FXUUHQW

ZKRVHYDOXHLVDOZD\VWKHWDVNVWUXFWXUHIRUWKHFXUUHQW

SURFHVV,QWKHGULYHUIRU

GHYFT

IRUH[DPSOHLWPDNHVVHQVHWRDFFHVVWKLVYDULDEOHIURP

FTBZULWH

EXW

QRWIURP

FTBWLPHUBKDQGOH

2QHRIWKHFRPSRQHQWVRI

VWUXFWWDVNBVWUXFW

LV

WVV

WKHKDUGZDUH V

WDVNVWDWHVHJPHQW7KH

SLG

FRPSRQHQWLVWKH3URFHVV,'QXPEHUZKLFKVKRZVXSZKHQ

SV

LVUXQ,WLV

QHHGHGZKHQNLOOLQJMREVIURPWKHFRPPDQGOLQH$QRWKHUFRPSRQHQWRI

VWUXFWWDVNBVWUXFW

LV

VLJQDO

7KLVFRPSRQHQWLVFXUUHQWO\W\SHGDVDQDUUD\RILQWHJHUV(DFKELWRQHDFKLQWHJHULQWKHDUUD\FDQFDUU\D

VLJQDO:LWKWZRELWLQWHJHUVLQWKHDUUD\/LQX[LVFRQILJXUHGIRUDPD[LPXPRIVLJQDOV:KDWHYHUWKH

VXEWOHGLVWLQFWLRQVDUHEHWZHHQDOORIWKHVHGLIIHUHQWVLJQDOVUHFHLYLQJDVLJQDOPHDQVMXVWRQHWKLQJWRD

GHYLFHGULYHULW VWLPHWRTXLW

'ULYHUVWKDW&DQ W%H.LOOHG

7KHVLJQDOBSHQGLQJFDOOFKHFNVWKH

VLJQDO

FRPSRQHQWRIWKHSURFHVVIRUQRQ]HURELWV,WLVWKH

UHVSRQVLELOLW\RIWKHZULWHURIWKHGHYLFHGULYHUWRPDNHVXUHWKLVLVGRQHDQGWRJRDKHDGDQGTXLWLIVXFKELWV

DUHIRXQG)DLOXUHWRGRVRUHVXOWVLQDGHYLFHGULYHUWKDWFDQ WEHNLOOHG7KLVLVDQHDV\PLVWDNHWRPDNHDQG

DVHULRXVRQH0XOWLWDVNLQJLQ/LQX[LVVRPHWLPHVFDOOHGFRRSHUDWLYHPXOWLWDVNLQJ8VHUWDVNVZKLFKH[HFXWH

DVHULRXVRQH0XOWLWDVNLQJLQ/LQX[LVVRPHWLPHVFDOOHGFRRSHUDWLYHPXOWLWDVNLQJ8VHUWDVNVZKLFKH[HFXWH

ZLWKNHUQHOSULYLOHJHVXFKDV

FTBZULWH

DUHH[SHFWHGWR\LHOGWRWKHSURFHVVRUYROXQWDULO\,IWKH\GRQ W

WKHVFKHGXOHUZRQ WIRUFHWKHPWRGRVR,QRUGHUWRIXOILOOWKLVUHVSRQVLELOLW\WKHGULYHUPXVWLQFOXGHFRGH

VXFKDV

LIVLJQDOBSHQGLQJFXUUHQW

UHWXUQYDOXH

DWSRLQWVLQWKHFRGHZKLFKZLOOEHHQFRXQWHUHGIUHTXHQWO\HQRXJKVRWKDWZDLWLQJIRUWKHGHYLFHGULYHUWR

DUULYHDWWKHVHSRLQWVDVLWH[HFXWHVZLOOQRWFDXVHXQGXHGHOD\

2QHPRUHGHWDLOQHHGVIL[LQJLQRUGHUWRPDNHVXUHWKHGULYHUUHVSRQGVWRVLJQDOV

6WDWHVRID3URFHVV

$YHU\LPSRUWDQWFRPSRQHQWRI

VWUXFWWDVNBVWUXFWLVVWDWH

,WVPRVWLPSRUWDQWYDOXHVDUHDVVLJQHG

LQ

XVUVUFOLQX[LQFOXGHOLQX[VFKHGK

GHILQH7$6.B5811,1*

GHILQH7$6.B,17(55837,%/(

GHILQH7$6.B81,17(55837,%/(

GHILQH7$6.B=20%,(

GHILQH7$6.B67233('

7DVNVZKLFKDUHRQWKHUXQTXHXHLHWKRVHZKLFKDUHQRZWDNLQJWXUQVXVLQJWKHSURFHVVRUKDYH

7$6.B5811,1*

DVWKHYDOXHRIWKHLU

VWDWH

FRPSRQHQW:KHQDWDVNSXWVLWVHOIRQWRDZDLWTXHXH

VWDWH

PD\

WDNHHLWKHU

7$6.B,17(55837,%/(

RU

7$6.B81,17(55837,%/(

DVYDOXHV$QGLWPDNHVDELJGLIIHUHQFH

$OWKRXJKZHPLJKWUHDVRQDEO\VXSSRVHWKDWWKHGLIIHUHQFHKDVWRGRZLWKLQWHUUXSWVLWGRHVQ W,WKDVWRGR

ZLWKVLJQDOV

,I

VWDWH

KDVWKHYDOXH

7$6.B81,17(55837,%/(

WKHQLWV

VLJQDO

FRPSRQHQWZLOOQRWEHDOWHUHGE\D&WUO&

RUD

NLOO

8QIRUWXQDWHO\WKLVLVWKHYDOXHDVVLJQHGWR

VWDWH

E\WKH

VOHHSBRQ

IXQFWLRQ)RUWXQDWHO\WKHUH

LVDFORVHO\UHODWHGIXQFWLRQFDOOHG

VOHHSBRQBLQWHUUXSWLEOH

ZKLFKDVVLJQVWKHYDOXH

7$6.B,17(55837,%/(

WR

VWDWH

+HQFHLQ

3URJUDP

WKHFDOOVWR

VOHHSBRQ

DQG

ZDNHBXS

QHHGWR

EHUHSODFHGE\WKHLULQWHUUXSWLEOHFRXQWHUSDUWV2WKHUZLVHZHZRXOGKDYHWKHVDPHSUREOHPWKDWZHZRXOG

JHWLIZHRPLWWHGWKHVLJQDOBSHQGLQJFKHFN7KHGHILQLWLRQVRIWZRVOHHSBRQIXQFWLRQVDUHGHILQHG

LQ

XVUVUFOLQX[NHUQHOVFKHGF

DVZHOODVWKHPDLQSDUWRI

ZDNHBXS

7KHWZRZDNHBXSPDFURVDUH

GHILQHGLQ

XVUVUFOLQX[LQFOXGHOLQX[VFKHGK

,QWKHGLJLWL]HUGULYHULQ

VHFWLRQ



ZDNHBXSBLQWHUUXSWLEOH

PDFURGHILQLWLRQPXVWEHFRQVXOWHGWR

ILQGRXWWKHDFWXDOIXQFWLRQFDOOVLQFHWKHJFFSUHSURFHVVRULVQ WXVHGE\1$60

7KHPDLQIHDWXUHVRIWKH0RUVH&RGHVSHDNHUGULYHUDUHQRZLQSODFHVRZHFDQGRWKHIXQSDUWQH[W

7LPLQJWKH0RUVH&RGH

7KHWLPLQJRIGRWVDQGGDVKHVLVDQDUWQRWDVFLHQFH$0RUVH&RGHGULYHUKDVJRRGWLPLQJLILWVRXQGV

ULJKWWRD0RUVH&RGHSUDFWLWLRQHU7LPHYDOXHVLQWKLVGULYHUDUHEDVHGRQWKHIROORZLQJUXOHV

z

$OOWLPHYDOXHVDUHEDVHGRQWKHGXUDWLRQRIWKH

ZKROHQRWH

FRPSRQHQWRI

FTBDUHD

ZKLFKLVJLYHQLQ

KXQGUHGWKVRIDVHFRQGRU

MLIILHV

z

$GDVKLVRQHIRXUWKRID

ZKROHQRWH

z

$GRWLVRQHVL[WHHQWKRID

ZKROHQRWH

z

4XLHWLQWHUYDOVEHWZHHQGRWVDQGGDVKHVRIDOHWWWHUDUHRQHHLJKWKRID

ZKROHQRWH

4XLHWLQWHUYDOVEHWZHHQOHWWHUVDUHWKUHHHLJKWKVRID

z

4XLHWLQWHUYDOVEHWZHHQOHWWHUVDUHWKUHHHLJKWKVRID

ZKROHQRWH

z

$FKDUDFWHUQRWLQFOXGHGLQWKH0RUVH&RGHJHWDVLOHQWLQWHUYDORIRQHTXDUWHURID

ZKROHQRWH

$VVHPEO\/DQJXDJH6SHDNHU&RGH

7RWXUQWKHVSHDNHURQDQGRIIWKHWZROLWWOHDVVHPEOHUURXWLQHVVKRZQLQ

3URJUDP

DUHXVHG$OWKRXJK

WKHEXONRIWKHGHYLFHGULYHULVZULWWHQLQ&WKLVLVRIWHQWKHFDVH0DQ\WLPHVVPDOOURXWLQHVDUHFRGHGLQ

DVVHPEO\ODQJXDJHDQGWKHUHVWLVFRGHGLQDKLJKHUOHYHOODQJXDJH

,IWKHILOHFRQWDLQLQJ

3URJUDP

LVFDOOHG

VSHDNDVP

LWFDQWKHQE\DVVHPEOHGXVLQJ1$60

OLQX[ER[QDVPIHOIVSHDNDVP

7KH

IHOI

VZLWFKGHWHUPLQHVWKHIRUPDWRIWKHUHVXOWLQJREMHFWFRGHILOHFDOOHG

VSHDNR

,WVKRXOGEH

VWRUHGLQ

XVUVUFOLQX[GULYHUVFKDU

3URJUDP

JOREDOVSHDNHURQ

JOREDOVSHDNHUBRII

H[WHUQFTBDUHD

6<63HTX+6\VWHPSRUWIRUFRQWUROOLQJVSHDNHUIHHG

',95(*HTX+3RUWIRUWLPHUGLYLVRU

VSHDNHUBRII

,1$/>6<63@

$1'$/)&+

287>6<63@$/

029($;>FTBDUHD@

25($;

029>FTBDUHD@($;

5(7

VSHDNHUBRQ

029($;>FTBDUHD@

WLPHUGLYLVRIIVHWE\

287>',95(*@$/

6+5($;

287>',95(*@$/

,1$/>6<63@

25$/

287>6<63@$/

029($;>FTBDUHD@

$1'($;)))))))%+

029>FTBDUHD@($;

5(7

&/DQJXDJH'ULYHU&RGH

3URJUDP

LQFOXGHOLQX[HUUQRK! 1HHGWKLVIRU(12'(9HWF 

LQFOXGHOLQX[NHUQHOK! 1HHGWKLVIRUSULQWN 

LQFOXGHOLQX[PDMRUK! 1HHGWKLVIRU&4B0$-25 

LQFOXGHOLQX[VFKHGK! 1HHGWKLVIRUVOHHSLQJDQGZDNLQJ 

LQFOXGHDVPXDFFHVVK! 1HHGWKLVIRUFRS\BIURPBXVHU 

LQFOXGHOLQX[FTK! 1RWHWKHFTILOH 

YRLGFTBWLPHUBKDQGOHUXQVLJQHGORQJ

VWDWLFYRLGFTBVHWBSLWFKXQVLJQHGORQJ

VWDWLFYRLGFTBVHWBWHPSRXQVLJQHGORQJ

YRLGVSHDNHUBRQYRLG

YRLGVSHDNHUBRIIYRLG

YRLGVSHDNHUBRIIYRLG

FKDU PRUVHBFRGH>@ ^







`

 7KHHPSW\VWULQJIROORZHGE\WKHOHWWHUFRGHV

IROORZHGE\WKHQXPHUDOFRGHVIROORZHGE\WKHFRPPD

SHULRGDQGTXHVWLRQPDUN 

VWUXFWFTBVWUXFWFTDUHD ^^`18//`

VWUXFWWLPHUBOLVWFTBWLPHU ^18//18// FTBWLPHUBKDQGOHU`

LQOLQHFKDU PFRGHVWULQJLQWDVFLLFRGH

^

FKDU PF

 7KLVLVWKHPDSSLQJIURPWKH$6&,,FRGH

LQWRWKHPFRGHDUUD\RIVWULQJV 

LIDVFLLFRGH! 3DVW ]  

PF PRUVHBFRGH>&4B'()$8/7@

HOVHLIDVFLLFRGH! 8SSHUFDVH 

PF PRUVHBFRGH>DVFLLFRGH@

HOVHLIDVFLLFRGH! 8QFRGHGSXQFWXDWLRQ 

PF PRUVHBFRGH>&4B'()$8/7@

HOVHLIDVFLLFRGH! /RZHUFDVH 

PF PRUVHBFRGH>DVFLLFRGH@

HOVHLIDVFLLFRGH  4XHVWLRQ0DUN 

PF PRUVHFRGH>@  

HOVHLIDVFLLFRGH! 8QFRGHGSXQFWXDWLRQ 

PF PRUVHBFRGH>&4B'()$8/7@

HOVHLIDVFLLFRGH! 1XPHUDOV 

PF PRUVHBFRGH>DVFLLFRGH@ DVFLLFRGH 

HOVHLIDVFLLFRGH  3HULRG 

PF PRUVHBFRGH>@  

HOVHLIDVFLLFRGH  &RPPD 

PF PRUVHBFRGH>@  

HOVH

PF PRUVHBFRGH>&4B'()$8/7@

UHWXUQPF

`

VWDWLFLQWFTBUHVHWYRLG

^

VSHDNHUBRII

FTBVHWBSLWFK&4B'()B3,7&+ 3LWFKLQ+] 

FTBVHWBWHPSR&4'()7(032 4XDUWHUQRWHHTXDOVWKLV 

UHWXUQ

`

YRLGFTBWLPHUBKDQGOHUXQVLJQHGORQJ[

^

 7KLVLVWKHIXQFWLRQZKLFKLVFDOOHGEHFDXVH

LWVQDPHLVVXEPLWWHGWRWKHWLPHUTXHXH 

LQWVWDWXV

XQVLJQHGLQWWLPHBYDOXH

WLPHBYDOXH MLIILHV 0ROOLI\JFF 

VWDWXV FTBDUHDIODJV

LI FTBDUHDPFRGH  VWDWXV &4B2))

 FTDUHDEXIIHUBRIIVHW FTBDUHDEXIIHUBHQG

 7KLVEXIIHUORDGLVGRQH 

^

ZDNHBXSBLQWHUUXSWLEOH FTBDUHDFTBZDLWBT

UHWXUQ

`

LI FTBDUHDPFRGH  VWDWXV &4B2))

 7KLVFKDUDFWHULVGRQH5HVHWPFRGH 

^

FTBDUHDEXIIHUBRIIVHW FTBDUHDEXIIHURIIVHW

[ FTBDUHDEXIIHU>FTBDUHDEXIIHUBRIIVHW@

FTBDUHDPFRGH PFRGHVWULQJ[

`

LI FTBDUHDPFRGH  VWDWXV &4B2))

 3UHFHGLQJLIEORFNSXWLQWKHHPSW\VWULQJ 

 (PSW\VWULQJJHWVDTXDUWHUQRWH 

^

WLPHBYDOXH FTBDUHDZKROHQRWH!!

`

HOVHLIVWDWXV &4B2))

 6SHDNHULVRII%HJLQDQRWKHUGRWRUGDVK 

^

LI FTBDUHDPFRGH  B 

WLPHBYDOXH FTBDUHDZKROHQRWH!!

HOVHLI FTBDUHDPFRGH   

WLPHBYDOXH FTBDUHDZKROHQRWH!!

FTBDUHDPFRGH FTBDUHDPFRGH

VSHDNHUBRQ

`

HOVHLI FTBDUHDPFRGH 

 6SHDNHULVRQ(QGRIFKDUDFWHU 

^

WLPHBYDOXH

FTBDUHDZKROHQRWH!!FTBDUHDZKROHQRWH!!

 LQWHUOHWWHUUHVW 

VSHDNHUBRII

`

HOVH 6SHDNHULVRQ,QWKHPLGVWRIDFKDUDFWHU 

^

WLPHBYDOXH FTBDUHDZKROHQRWH!!

 6KRUWLQWUDOHWWHUUHVW 

VSHDNHUBRII

`

FTWLPHUH[SLUHV MLIILHVWLPHBYDOXH



FTBWLPHUH[SLUHV MLIILHV

,QFDVH\RXKDYHVHHQWKLVHOVHZKHUH

LWGRHV1RW:RUN



DGGBWLPHU FTBWLPHU

UHWXUQ

`

VWDWLFVVL]HBWFTBZULWHVWUXFWILOH ILOHFRQVWFKDU EXI

VL]HBWFRXQWORIIBW SSRV

^

 7KLVIXQFWLRQILOOVWKHEXIIHUDQGWKHQJRHVWRVOHHS 

XQVLJQHGORQJFRS\BVL]H

XQVLJQHGLQWWLPHBYDOXH

VVL]HBWWRWDOBE\WHVBZULWWHQ 

WLPHBYDOXH 

WRWDOBE\WHVBZULWWHQ 

GR

^

LIVLJQDOBSHQGLQJFXUUHQW

UHWXUQWRWDOBE\WHVBZULWWHQ

FRS\BVL]H FRXQW &4B%8))(5B6,=("FRXQW&4B%8))(5B6,=(

FTBDUHDEXIIHUBRIIVHW 

FTBDUHDEXIIHUBHQG FRS\BVL]H

FRS\BIURPBXVHUFTBDUHDEXIIHUEXIFRS\BVL]H

FRS\BIURPBXVHUFTBDUHDEXIIHUEXIFRS\BVL]H

FTBDUHDPFRGH PFRGHVWULQJFTBDUHDEXIIHU>@

WLPHBYDOXH FTBDUHDZKROHQRWH!!

FTBWLPHUH[SLUHV MLIILHVWLPHBYDOXH

DGGBWLPHU FTBWLPHU

VSHDNHUBRII

LQWHUUXSWLEOHBVOHHSBRQ FTBDUHDFTBZDLWBT

WRWDOBE\WHVBZULWWHQ WRWDOBE\WHVBZULWWHQFRS\BVL]H

FRXQW FRXQWFRS\BVL]H

EXI EXIFRS\BVL]H

`ZKLOHFRXQW!

GHOBWLPHU FTBWLPHU

UHWXUQWRWDOBE\WHVBZULWWHQ

`

VWDWLFORQJORQJFTBOVHHNVWUXFWILOH ILOH

ORQJORQJRIIVHWLQWRULJLQ

^

UHWXUQ(63,3(

`

VWDWLFLQWFTBRSHQVWUXFWLQRGH LQRGHVWUXFWILOH ILOH

^

XQVLJQHGLQWPLQRU 0,125LQRGH!LBUGHY

LIPLQRU! 6WHUHR1R 

UHWXUQ(1;,2

LIFTBDUHDIODJV &4B(;,67 

UHWXUQ(1;,2

LIFTBDUHDIODJV &4B%86<

UHWXUQ(%86<

FTBDUHDIODJV FTBDUHDIODJV_&4B%86<

UHWXUQ

`

VWDWLFLQWFTBUHOHDVHVWUXFWLQRGH LQRGHVWUXFWILOH ILOH

^

FTBDUHDIODJV FTBDUHDIODJV a&4B%86<

UHWXUQ

`

VWDWLFYRLGFTBVHWBSLWFKXQVLJQHGORQJFSV

^

FTBDUHDWLPHUGLY FSV

 )UHTXHQF\RIWKH26&VLJQDORQWKH$7EXV 

`

VWDWLFYRLGFTBVHWBWHPSRXQVLJQHGORQJEHDWVBSHUB0LQXWH

^

 4XDUWHUQRWH EHDWWLPHUZRUNVLQFHQWLVHFRQGV 

FTBDUHDZKROHQRWH EHDWVBSHUBPLQXWH

`

VWDWLFLQWFTBLRFWOVWUXFWLQRGH LQRGHVWUXFWILOH ILOH

XQVLJQHGLQWFPGXQVLJQHGORQJDUJ

^

XQVLJQHGLQWPLQRU 0,125LQRGH!LBUGHY

LQWUHWYDO 

LIPLQRU!

UHWXUQ(12'(9

LIFTBDUHDIODJV &4B(;,67 

UHWXUQ(12'(9

VZLWFKFPG

^

FDVH&4$%257

LIDUJ

FTBDUHDIODJV FTBDUHDIODJV_&4B$%257

HOVH

FTBDUHDIODJV FTBDUHDIODJV a&4B$%257

EUHDN

FDVH&46(73,7&+

LIDUJ

FTBVHWBSLWFKDUJ

HOVH

UHWYDO (,19$/

EUHDN

FDVH&46(77(032

LIDUJ

FTBVHWBWHPSRDUJ

HOVH

UHWYDO (,19$/

EUHDN

FDVH&45(6(7

FTBUHVHW

EUHDN

FDVH&4*(7)/$*6

UHWYDO YHULI\BDUHD9(5,)<B:5,7(

YRLG DUJVL]HRILQW

LIUHWYDO

UHWXUQUHWYDO

HOVH

^

LQWVWDWXV FTBDUHDIODJV

FRS\BWRBXVHULQW DUJ VWDWXVVL]HRILQW

`

EUHDN

GHIDXOW

UHWYDO (,19$/

`

UHWXUQUHWYDO

`

LQWFTBLQLWYRLG

^

 ,QLWLDOL]DWLRQFRGHOLNHWKLVFDQEHFDOOHG

LIDFDOOWRLWLVSODFHGLQPHPF 

LIUHJLVWHUBFKUGHY&4B0$-25FT FTBIRSV

^

SULQWN.(51B,1)2FTXQDEOHWRJHWPDMRUG?Q&4B0$-25

UHWXUQ(,2

`

FTBDUHDIODJV &4B2))_&4B(;,67

FTBUHVHW

UHWXUQ

`

,WLVFXVWRPDU\WRLQFOXGHGHILQLWLRQVRISDUDPHWHUVXVHGLQWKH&SURJUDPLQDQLQFOXGHILOH$QLQFOXGHILOH

IRUWKH0RUVH&RGHGULYHUIROORZV

GHILQH&4B(;,67[

GHILQH&4B%86<[

GHILQH&4B2))[

GHILQH&4B$%257[

 ,2&7/QXPEHUV 

GHILQH&4$%257[

GHILQH&46(77(032[ 6WRUHZKROHQRWHLQWFTBDUHD 

GHILQH&46(73,7&+[ 6WRUHDWLPHUGLYLVRULQWRFTBDUHD 

GHILQH&45(6(7[F UHVHWVSHDNHU 

GHILQH&4*(7)/$*6[H JHWVWDWXVIODJV 

GHILQH&4B%8))(5B6,=(

GHILQH&4B%8))(5B6,=(

GHILQH&4B'()B&+$5 'HIDXOWFKDUDFWHU 

GHILQH&4B'()B3,7&+ 'HIDXOWSLWFK 

GHILQH&4B'()B7(032 'HIDXOWWHPSR 



IXQFWLRQSURWRW\SHV



H[WHUQLQWFTBLQLWYRLG

7KHIXQFWLRQVGHILQHGLQ

VWUXFWFTBVWUXFW

WDNHFDUHRIWKHUHVSRQVHE\WKHGULYHUWRUHTXHVWVWKDWWKH

NHUQHOPDNHVLQH[HFXWLQJDV\VWHPFDOOZKLFKLVDVNLQJIRUVHUYLFHIURPWKHGULYHU7KH

FTBWLPHUBKDQGOHU



IXQFWLRQWDNHVFDUHRIWKHGULYHU VUHVSRQVHWRDWLPHULQWHUUXSW7KHVHDUHWKHPDLQWKLQJVWKDWQHHGWREH

GRQH%XWZKHQWKHGHYLFHGULYHUZRUNVFRPPDQGVVXFKDV

OLQX[ER[FDWILOH!GHYFT

ZLOOVWDUWWKHVSHDNHUEHHSLQJ,QRUGHUIRUWKLVWRKDSSHQWKHUHKDVWREHDQHQWU\QDPHG

FT

LQWKH

GHY

GLUHFWRU\ZKLFKKDVDFRQQHFWLRQZLWKWKHSURJUDPVVXFKDV

FTBZULWH

/RRVH(QGV

7RILQLVKWKHGHYLFHGULYHULWLVRQO\QHFHVVDU\WR

z

$GGDPDMRUQXPEHUIRUWKHGHYLFHWRWKH

XVULQFOXGHOLQX[PDMRUK

ILOH

z

&UHDWHDQHQWU\IRUWKHGHYLFHLQWKH

GHY

GLUHFWRU\XVLQJWKHPNQRGFRPPDQG

z

:ULWHD

FTBLQLW

IXQFWLRQDQGLQFOXGHDFDOOWRLWLQWKH

PHPF

ILOH

z

0RGLI\WKH0DNHILOHIRUWKHGLUHFWRU\FRQWDLQLQJWKHGULYHULQWKLV

FDVH

XVUVUFOLQX[GULYHUVFKDU

DQGUHFRPSLOHWKHNHUQHO

7KH

GHY

GLUHFWRU\FRQWDLQVDOLVWRIDJUHDWPDQ\ILOHVPRVWRIZKLFKDUHQRWDFWXDOO\ILOHV7KH

OV±O

FRPPDQGGLVWLQJXLVKHVGLIIHUHQWW\SHVRIILOHVLQWKHYHU\ILUVWFKDUDFWHURIHDFKOLQH)LOHVZKLFKUHDOO\DUH

ILOHVDUHOLVWHGEHJLQQLQJZLWKD



GLUHFWRULHVDUHOLVWHGZLWKD

G

KDUGOLQNVZLWKDQ

O

HWF'HYLFHVDUH

OLVWHGZLWKHLWKHUD

E

RUD

F

GHSHQGLQJRQZKHWKHUWKH\DUHEORFNGHYLFHVRUFKDUDFWHUGHYLFHV%ORFN

GHYLFHVWUDQVIHUGDWDLQEORFNVLHELJXQLIRUPO\VL]HGFKXQNV7RGRWKLVWKH\LQWHUDFWZLWKWKHNHUQHO V

EXIIHUFDFKH%ORFNGHYLFHVFDQEHPRXQWHGLHLQFRUSRUDWHGLQWR8QL[ VWUHHVWUXFWXUHGILOHKHLUDUFK\$

KDUGGULYHLVDJRRGH[DPSOHRIDEORFNGHYLFH&KDUDFWHUGHYLFHVGRQ WXVHEORFNVDQGWKH\GRQ WJHW

PRXQWHG2XUOLWWOHVSHDNHUGULYHULVDFKDUDFWHUGHYLFH(DFKGHYLFHOLVWLQJZKHWKHUIRUDEORFNRUD

FKDUDFWHUGHYLFHDOVROLVWVDPDMRUQXPEHUDQGDPLQRUQXPEHU7KHPDMRUQXPEHULVXVHGDVDQLQGH[LQWR

FKUGHYV

DNHUQHODUUD\RIFKDUDFWHUGHYLFHGULYHUV

VWUXFWGHYLFHBVWUXFWFKUGHYV>0$;B&+5'(9@

(DFKGHYLFHGULYHULVMXVWD

VWUXFWGHYLFHBVWUXFW

^

FRQVWFKDU QDPH

FRQVWVWUXFWILOHBRSHUDWLRQV IRSV

`

7KHGHYLFHLVHQWHUHGLQWRWKHDUUD\E\WKHIXQFWLRQ

UHJLVWHUBFKUGHY

ZKLFKLVGHILQHG

LQ

XVUVUFOLQX[IVGHYLFHVF

7KHPRVWLPSRUWDQWOLQHVRIWKLVGHILQLWLRQDUHDVIROORZV

3URJUDP

LQWUHJLVWHUBFKUGHYXQVLJQHGLQWPDMRU

FRQVWFKDU QDPH

FRQVWFKDU QDPH

VWUXFWILOHBRSHUDWLRQV IRSV

^

FKUGHYV>PDMRU@QDPH QDPH

FKUGHYV>PDMRU@IRSV IRSV

UHWXUQ

`

:KHQWKLVIXQFWLRQLVFDOOHGWKHPDMRUQXPEHULVFRQQHFWHGWRWKHILOHRSHUDWLRQVVWUXFWXUHVHWXSE\WKH

GHYLFHGULYHU7KHFDOOLVPDGHE\WKHGHYLFHGULYHULQWKH

FTBLQLW

IXQFWLRQ7KHRQO\RWKHUWDVN

SHUIRUPHGE\

FTBLQLW

LVWKHLQLWLDOL]DWLRQRIVRPHRIWKHYDOXHVLQ

FTBDUHD

,QRUGHUWRJHWWKHFDOO

SHUIRUPHGGXULQJERRWWLPHDFDOOWRLWPD\EHSODFHGLQWKH

PHPF

SURJUDPQHDUWKHHQGQHDUWKHFDOOWR

OSBLQLW

7KHFRPPDQG

OLQX[ER[PNQRGGHYFTF

FUHDWHVDQHQWU\LQILOHV\VWHPIRUWKH

FT

GHYLFHJLYLQJLWDPDMRUQXPEHURIDQGDPLQRUQXPEHURI

7KLVHQWU\LQWKH

GHY

GLUHFWRU\LVWKHQXVHGWRWUDQVODWHUHIHUHQFHVWR

GHYFT

LQWRFDOOVWRWKHIXQFWLRQV

OLVWHGLQWKHILOHRSHUDWLRQVVWUXFWXUH

6HULDO3RUW'LJLWL]HU'ULYHU

7KH6FDOH[GHYLFHLVDKDQGKHOGPHDVXULQJGHYLFHIRUUHDGLQJGLVWDQFHVRIIRIDIODWVXUIDFH,WLQSXWVGDWD

DWDUDWHRIEDXGWKURXJKWKHVHULDOSRUW6LQFHLWKDVQRKDQGVKDNLQJKDUGZDUHLWGRHVQRWUHVSRQGWR

VRIWZDUHZKLFKWUHDWVLWDVDPRGHPRUDWHUPLQDO,WDOVRKDQGOHVGDWDLQDVSHFLDOIRUPDWZKLFKSDFNVWZR

IRXUELWFKDUDFWHUVLQWRHDFKE\WHVHQWRUUHFHLYHG)RUERWKRIWKHVHUHDVRQVLWLVXVHIXOWRZULWHDVSHFLDO

GULYHUIRULW

2QHLPSRUWDQWHOHPHQWRIDW\SLFDOGHYLFHGULYHUZKLFKZDVQRWQHHGHGLQWKH0RUVH&RGHGHYLFHGULYHU

ZDVWKHLQVWDOODWLRQRIDQLQWHUUXSWKDQGOHU7KH0RUVH&RGHGULYHUVLPSO\WRRNDGYDQWDJHRIWKHVHUYLFHVRI

WKHH[LVWLQJLQWHUUXSWKDQGOHUIRUWKHWLPHULQWHUUXSW

6HWWLQJ8SD1HZ,QWHUUXSW+DQGOHU

0RVWGHYLFHGULYHUVQHHGDQ,65WRKDQGOHLQWHUUXSWVZKLFKFRPHIURPWKHGHYLFH7KH/LQX[IXQFWLRQ

UHTXHVWBLUT

WDNHVFDUHRIWKHLQVWDOODWLRQRIDQHZKDQGOHU,WVGHILQLWLRQLVORFDWHG

LQ

XVUVUFOLQX[DUFKLNHUQHOLUTF

LQWUHTXHVWBLUTXQVLJQHGLQWLUT

7DEOH$6&,,&RGH&KDUW

 &WUO#



63&!



#





&WUO$







$



D



&WUO%







%



E



&WUO&







&



F



&WUO'







'



G



&WUO(







(



H



&WUO)





)



I



&WUO*





*



J



&WUO+







+



K



&WUO,







,



L



&WUO-





-



-



&WUO.







.



N



&WUO/







/



O



&WUO0







0



P



&WUO1







1



Q



&WUO2



?



2



R



&WUO3







3



3

YRLG KDQGOHULQWYRLG VWUXFWSWBUHJV 

XQVLJQHGORQJLUTIODJV

FRQVWFKDU GHYQDPH

YRLG GHYBLG

6FDOH[,QWHUUXSW+DQGOHU

2QHYLWDOOLQNEHWZHHQWKHLQWHUUXSWKDQGOHUZKLFKLVZULWWHQLQDVVHPEOHUDQGWKHUHVWRIWKHSURJUDPLVWKH

GHILQLWLRQRIWKHVFDOH[GHYLFHPHPRU\DUHD6LQFHWKHDVVHPEO\FRGHGRHVQRWKDYHDFFHVVWRWKHODEHOVXVHG

LQWKH&FRPSLOHULWLVLPSRUWDQWWRFRXQWRIIWKHRIIVHWE\WHVIURPWKHEHJLQQLQJRIWKHVWUXFWXUH7KHVHDUH

XVHGWRDFFHVVWKHGHYLFHPHPRU\+HQFH

VFDOH[BDUHD

LVXVHGLQVWHDGRI

VFDOH[BDUHDUHDGLQ

6LQFHDOOWKHFRPSRQHQWVRIWKLVVWUXFWXUHDUHIRXUE\WHVLQVL]HWKHUHDUHQRWULFNVLQWKHFRXQWLQJ

3URJUDP

VWUXFWFTBVWUXFW

^

XQVLJQHGORQJIODJV  

XQVLJQHGLQWUHDGLQ  

XQVLJQHGLQWUHDGRXW  

XQVLJQHGLQWZULWHLQ  

XQVLJQHGLQWZULWHRXW  

FKDU UHDGBEXIIHU  

FKDU ZULWHBEXIIHU  

VWUXFWZDLWBTXHXH UGZDLWBT  

VWUXFWZDLWBTXHXH ZUZDLWBT  

`

JOREDOVFDOH[BLQWHUUXSW

5%6HTX7KLVPXVWEHDSRZHURI

&20HTX)+&20%DVH,2$GGUHVVDQG'DWD3RUW

H[WHUQVFDOH[BDUHD

H[WHUQSULQWN

H[WHUQBBZDNHBXS



VFDOH[BLQWHUUXSW

3XVKDOOWKHUHJLVWHUVWKDWJHWXVHGH[FHSW($;

386+(&;

386+(';

386+(%;

386+(6,

386+(',

029(';&20/LQH6WDWXV5HJLVWHU

,1$/';

7(67$/6HHLI'DWD+DV$UULYHG

-=1($5:5'1R"7KHQ1HHGWR:ULWH'DWD"



&WUO3







3



3



&WUO4







4



T



&WUO5







5



U



&WUO6







6



V



&WUO7







7



W



&WUO8







8



X



&WUO9







9



9



&WUO:







:



:



&WUO;







;



;



&WUO<







<



\



&WUO=







=



=



&WUO>







>



^



&WUO?







?



_



&WUO@





@



`



&WUOA



!



A



a



&WUOB



"







'(/!



3URFHVV,QFRPLQJ'DWD



029(6,>VFDOH[BDUHD@UHDGLQFRPSRQHQWRIVWUXFWXUH

$''(6,5%65HDG%XIIHU6L]H

68%(6,>VFDOH[BDUHD@UHDGRXWFRPSRQHQWRIVWUXFWXUH

$1'(6,5%65HDG%XIIHU6L]H

-=1($55%)5HDG%XIIHU)XOO



7KHVHOLQHVWHVWWKHFRQGLWLRQ

UHDGLQ UHDGRXW25UHDGLQ UHDGRXWPRG

Q



,ILWLVWUXHWKHQWKHFLUFXODUEXIIHUKDVRYHUIORZHG1RWH5%6 

Q





029(';&20'DWD3RUWKDV]HURRIIVHW

,1$/';7KLVLVWKHGDWDE\WHULJKWKHUH

029&/$/.HHSZKROHE\WHLQ$/

$1'(&;&OHDU(&;DQGORRNDWKDOYHVLQ&/

029'/>2.&(&;@7UDQVODWHLQFRPLQJKDOIE\WH

029(%;>VFDOH[BDUHD@*HWDGGUHVVRI5HDG%XIIHU

029(6,>VFDOH[BDUHD@UHDGLQFRPSRQHQWRIVWUXFWXUH

029>(%;(6,@'/6WRUHWUDQVODWHGE\WHLQ5HDG%XIIHU

,1&(6,,QFUHPHQWUHDGLQ

$1'(6,5%6PRG

Q

RIFRXUVH

029>VFDOH[BDUHD@(6,

&03'/:DVWKDWDWHUPLQDOVLJQDO"

-=1($554:,IVRZDNHXSWKHUHDGLQJSURFHVV

029&/$/1RZGRWKHRWKHUKDOIE\WH

6+5&/

029'/>2.&(&;@7UDQVODWHLQFRPLQJKDOIE\WH

029>(%;(6,@'/6WRUHWUDQVODWHGE\WHLQ5HDG%XIIHU

,1&(6,,QFUHPHQWUHDGLQ

$1'(6,5%6PRG

Q

RIFRXUVH

029>VFDOH[BDUHD@(6,

&03'/:DVWKDWDWHUPLQDOVLJQDO"

-=1($554:,IVRZDNHXSWKHUHDGLQJSURFHVV



3URFHVV2XWJRLQJ'DWD

:5'

029(';&20,QWHUUXSW,GHQWLILFDWLRQ5HJLVWHU

,1$/';

7(67$/&KHFNWKH'DWD+DV%HHQ6HQW%LW

-=1($5/(91R"7KHQTXLW



6HHLIWKHHQGRIWKHZULWHEXIIHUKDVEHHQUHDFKHG

029(',>VFDOH[DUHD@ZULWHRXWFRPSRQHQWRIVWUXFWXUH

&03(',>VFDOH[BDUHD@ZULWHLQFRPSRQHQWRIVWUXFWXUH

-=:4:,IGRQHWKHQZDNHXSZULWLQJSURFHVV

32/

029(';&20/LQH6WDWXV5HJLVWHU

,1$/';

7(67$/'DWD+DV%HHQ6HQW%LW

-=32/6KRXOGEHMXVWDVKRUWZDLW

029(%;>VFDOH[BDUHD@*HWDGGUHVVRI:ULWH%XIIHU

029$/>(%;(6,@

029(';&20'DWD3RUW

287';$/+HUHLVWKHRXWJRLQJE\WH

,1&(6,

029>VFDOH[BDUHD@(6,ZULWHRXW

-03/(9

:4::ULWH4XHXH:DNHXS

6LQFHBBZDNHBXSORRNVOLNHDIXQFWLRQZHVKRXOGH[SHFW

WRSXVKWKHDUJXPHQWVDVVKRZQRQWKHQH[WWZROLQHV

386+GZRUG7$6.B,17(55837,%/(

386+GZRUGVFDOH[BDUHD:DNHXS

7KLVLVWKHGRXEOHSRLQWHU

+RZHYHUBBZDNHBXSDFWXDOO\ZDQWVLWVDUJXPHQWVSDVVHG

+RZHYHUBBZDNHBXSDFWXDOO\ZDQWVLWVDUJXPHQWVSDVVHG

LQUHJLVWHUV(';DQG($;

029(';7$6.B,17(55837,%/(

029($;VFDOH[BDUHD:ULWHZDLWTXHXH

&$//BBZDNHBXS

-03/(9

54:5HDG4XHXH:DNHXS

7HVWIODJVFRPSRQHQWIRUWKH5HDG3HQGLQJ%LW

7(67GZRUG>VFDOH[BDUHD@

-=1($5/(91R")DOVHDODUPMXVWTXLW

029(';7$6.B,17(55837,%/(

029($;VFDOH[BDUHD5HDGZDLWTXHXH

&$//BBZDNHBXS

-03/(9

5%)5HDG%XIIHU)XOO

386+GZRUG2952YHUIORZ

&$//SULQWN

$''(63

-03/(9

(UURUPHVVDJH

295GE5HDGEXIIHURYHUIORZ$+



+DOIE\WHWR%\WH7UDQVODWLRQWDEOH

2.&GE$%$+)

/(9

323(',

323(6,

323(%;

323(';

323(&;

5(7

6FDOH[6\VWHP&DOO+DQGOHUV

+HUHDUHWKHIXQFWLRQVZKLFKDUHSRLQWHGDWLQWKHILOHRSHUDWLRQVVWUXFWXUH

3URJUDP

LQFOXGHOLQX[HUUQRK!

LQFOXGHOLQX[NHUQHOK!

LQFOXGHOLQX[PDMRUK!

LQFOXGHOLQX[VFKHGK!

LQFOXGHOLPL[PDOORFK!

LQFOXGHOLQX[GHOD\K!

LQFOXGHOLQX[VFDOH[K!

LQFOXGHDVPLRK!

LQFOXGHDVPLUTK!

LQFOXGHDVPXDFFHVVK!

VWUXFWVFDOH[BVWUXFWVFDOH[DUHD

^18//18//18//18//`

VWDWLFLQWVFDOH[BUHVHWYRLG

^

LQWUHWYDO 

VFDOH[BDUHDIODJV 6&$/(;B(;,67

VFDOH[BDUHDUHDGLQ 

VFDOH[BDUHDUHDGRXW 

VFDOH[BDUHDZULWHLQ 

VFDOH[BDUHDZULWHRXW 

UHWXUQUHWYDO

`

VWDWLFLQOLQHFKDUFXWFKDU[

^

^

FKDU\

LI[  \ 

HOVHLI[   \ 

HOVHLI[!  $  [  ) \ [ $ 

HOVHLI[!  D  [  I \ [ D 

HOVHLI[!    [   \ [  

HOVHLI[ \ 

HOVHLI[ \ 

HOVHLI[ \ 

HOVH\ 

UHWXUQ\

`

VWDWLFLQOLQHFKDUFKDUBILOOFKDU[

^

 &RQYHUWIRXUELWFRGHLQWRD&FKDUDFWHU 

FKDU\

LI[ \  ) 

HOVHLI[ \   

HOVHLI[ \  7HUPLQDWLRQIODJ 

HOVHLI[ \   

HOVHLI[ \  % 

HOVHLI[ \  $  1RWXVHG 

HOVHLI[\ [  

HOVH\  .HHSWKHFRPSLOHUKDSS\ 

UHWXUQ\

`

VWDWLFLQOLQHLQWRNBDVFLLBFKDUFKDU[

^

 -XVWDYDOLGLW\FKHFNRQWKHWRVHHLI[

LVRQHRIWKHFKDUDFWHUVFRGHDEOHLQWKHIRXUELWVFDOH[FRGH 

UHWXUQ[!  $  [  ) __

[!  D  [  I __

[!    [   __

[   __[   __[  ?Q __[ 

`

VWDWLFLQOLQHYRLGZULWHBE\WHFKDU[

^

ZKLOHLQEBS6&$/(;B&20B%$6( 6&$/(;B/65B'$7$B287B(037<

XGHOD\O &KHFN/LQH6WDWXV5HJVLWHUXQWLOLWVRND\ 

RXWEBS[6&$/(;B&20B%$6(

`

VWDWLFVVL]HBWVFDOH[BZULWHVWUXFWILOH ILOHFRQVWFKDU EXI

VL]HBWFRXQWORIIBW SSRV

^

VVL]HBWUHWY

XQVLJQHGORQJFRS\BVL]H

LQWMNOVUBUHJ

FKDUFG

VWUXFWVFDOH[BVWUXFW VFDOH[  VFDOH[BDUHD

 6FDOH[WDNHVVKRUWFRPPDQGVWULQJV

&KDUDFWHUVIROORZLQJWHUPLQDWLRQZLOOEHGLVFDUGHG

7HUPLQDWLRQZLOOEHDGGHGWRDOOVWULQJV

 

N 

ZKLOHEXI>N@  N6&$/(;B:5,7(B6,=(

NFRXQWN N

LIN 6&$/(;B:5,7(B6,=(

UHWXUQ(,19$/

LIN UHWXUQFRXQW

 6LQFHFRXQW 6&$/(;B:5,7(B%8)6,=( 

FRS\BVL]H N

IRUN NFRS\VL]HN N

^

F EXI>N@

LIRNBDVFLLBFKDUF

UHWXUQ()$8/7

`

LIFRS\BIURPBXVHUVFDOH[!ZULWHBEXIIHUEXIFRS\BVL]H

^

UHWXUQ()$8/7

`

N FRS\BVL]H

 3DFNHDFKWZRE\WHVIURPWKHXVHU VEXIIHULQWRRQHE\WH

RIWKHVFDOH[EXIIHU 

IRUN M N FRS\BVL]HN NM M

LIN FRS\BVL]H

^

VFDOH[!ZULWHBEXIIHU>M@ [IG

`

HOVHLIN FRS\VL]H

^

F FXWEXI>N@

VFDOH[!ZULWHBEXIIHU>M@ [G_F

`

HOVH

^

F FXWEXI>N@

G FXWEXI>N@

VFDOH[!ZULWHBEXIIHU>M@ G_F

`

VFDOH[!ZULWHLQ M 1XPEHURIE\WHVLQWRVFDOH[EXIIHU 

ZKLOHLQEBS6&$/(;B&20B%$6( 6&$/(;B/65B'$7$B287B(037<

VFDOH[!ZULWHRXW  1H[WE\WHWREHWUDQVPLWWHG 

OVUBUHJ LQEBS6&$/(;B&20B%$6(

LIOVUBUHJ 

^

 5HDGWKLVGDPQE\WH,WVKRXOGQ WEHKHUHEXWLWLV 

F LQEBS6&$/(;B&20B%$6(

G FKDUBILOOF 2[I

LIVFDOH[!UHDGRXW  &LUFXODUEXIIHULVIXOO 

VFDOH[!UHDGLQ6&$/(;B5($'B%8))(5B6,=(__

VFDOH[!UHDGRXW

VFDOH[!UHDGLQ6&$/(;B5($'B%8))(5B6,=(

^

VFDOH[!IODJV

VFDOH[!IODJV_6&$/(;B(55_6&$/(;B5)8//

SULQWN7KHUHDGEXIIHURYHUIORZHG?Q

UHWXUQ()$8/7

`

LIG  2WKHUKDOIE\WHVKRXOGEHMXVWILOOHU 

^

 'RQ WVWRUHWKLV,WPLJKWJHWWKHUHDGVWXFN 

`

HOVH

^

VFDOH[!UHDGBEXIIHU>VFDOH[!UHDGLQ@ G

VFDOH[!UHDGLQ

VFDOH[!UHDGLQ6&$/(;B5($'B%8))(5B6,=(

G FKDUBILOOF!!

LIG 

^

 'RQ WVWRUHWKLVHLWKHU 

`

HOVH

^

VFDOH[!UHDGBEXIIHU>VFDOH[!UHDGLQ@ G

VFDOH[!UHDGLQ

VFDOH[!UHDGLQ6&$/(;B5($'B%8))(56,=(

`

`

`

RXWEBSVFDOH[!ZULWHBEXIIHU>@6&$/(;B&20B%$6(

LQWHUUXSWLEOHBVOHHSBRQ VFDOH[!ZUZDLWBT

LIVLJQDOBSHQGLQJFXUUHQW

UHWXUQ(,175

UHWY FRXQW

UHWXUQUHWY

`

VWDWLFORQJORQJVFDOH[BOVHHNVWUXFWILOH ILOH

ORQJORQJRIIVHWLQWRULJLQ

^

UHWXUQ(63,3(

`

VWDWLFVVL]HBWVFDOH[BUHDGVWUXFWILOH ILOHFKDU EXI

VL]HBWOHQJWKORIIBW SSRV

^

VWUXFWVFDOH[BVWUXFW VFDOH[  VFDOH[BDUHD

VVL]HBWFRXQW

LQWN 



5HDGIURPDVFLLBUHDGEXIIHU

0DNHWKHLQWHUUXSWKDQGOHUGRWKHWUDQVODWLQJ

VHHLIFKDULVZDLWLQJLQEXIIHU

LIVRUHDGLW

LIQRWVHW5($'3(1',1*ELWDQGJRWRVOHHS



VFDOH[!IODJV VFDOH[!IODJV_6&$/(;B53(1'

FRXQW OHQJWK

GR

^

LIVFDOH[!UHDGLQ VFDOH[!UHDGRXW

LQWHUUXSWLEOHBVOHHSBRQ VFDOH[!UGZDLWBT

LIVFDOH[!UHDGLQ VFDOH[!UHDGRXW

^

EXI>N@ VFDOH[!UHDGBEXIIHU>VFDOH[!UHDGRXW@

VFDOH[!UHDGRXW

 VFDOH[!UHDGRXW6&$/(;B5($'B%8))(5B6,=(

N N

LIEXI>N@ 6&$/(;B5($'B675,1*B7(50,1$/

UHWXUQN



:KHWKHUWKH7(50,1$/VWULQJLVFRXQWHGDVRQHRIWKHE\WHVUHDG

RUQRWKDVDGUDVWLFHIIHFW6FDQIKDQJVRQ(2/VLILWLV

EXWRQRUGLQDU\VWULQJVLILWLVQRW

,WLVSUREDEO\EHWWHUWRFRXQWLW



`

FRXQW FRXQW

`

ZKLOHFRXQW!

FRXQW N

 ,QWHUUXSWKDQGOHUVKRXOGFKHFN5($'B3(1',1*ELW

DQGLVVXHDZDNHXSLILWVVHW 

VFDOH[!IODJV VFDOH[!IODJV 6&$/(;B53(1'

UHWXUQFRXQW

`

VWDWLFLQWVFDOH[BRSHQVWUXFWLQRGH LQRGHVWUXFWILOH ILOH

^

FKDUF

LIVFDOH[BDUHDIODJV 6&$/(;B(;,67 

UHWXUQ(1;,2

LIVFDOH[BDUHDIODJV 6&$/(;B%86<

UHWXUQ(%86<

VFDOH[BDUHDUHDGBEXIIHU

FKDU NPDOORF6&$/(;B5($'B%8))(5B6,=(*)3B.(51(/

VFDOH[BDUHDZULWHBEXIIHU

FKDU NPDOORF6&$/(;B:5,7(B%8))(5B6,=(*)3B.(51(/

LIVFDOH[BDUHDUHDGBEXIIHU__VFDOH[BDUHDZULWHBEXIIHU

^

VFDOH[BDUHDIODJV VFDOH[BDUHDIODJV 6&$/(;B%86<

UHWXUQ(120(0

`



,QLWLDOL]HWKH6FDOH[$UHD



VFDOH[BDUHDUHDGLQ 

VFDOH[BDUHDUHDGRXW 

VFDOH[BDUHDZULWHLQ 

VFDOH[BDUHDZULWHRXW 



,QLWLDOL]HWKH&20SRUW



F LQEBS6&$/(;B&20B%$6( /LQH&RQWURO5HJLVWHU 

F F_[ %LWDOORZV%DXG5DWH6HWWLQJ 

RXWEBSF6&$/(;B&20B%$6(

RXWEBS6&$/(;B&20B%$6( %DXG5DWH'LYLVRU8SSHU%\WH 

RXWEBS[F6&$/(;B&20B%$6( %DXG%5'/RZHU%\WH 

RXWEBS6&$/(;B&20B%$6(

 3XWEDFNELWDQGPDNHSDULW\1 

F LQEBS6&$/(;B&20B%$6( 0RGHP&RQWURO5HJLVWHU 



RXWEBS6&$/(;B&20B%$6( ,QWHUUXSW(QDEOH5HJLVWHU 

 7UDQVPLWDQG5HFHLYH5HDG\2QO\ 

F F_

RXWEBSF6&$/(;B&20B%$6( (QDEOHLQWHUUXSWV 

UHWXUQ

`

VWDWLFLQWVFDOH[BUHOHDVHVWUXFWLQRGH LQRGHVWUXFWILOH ILOH

^

XQVLJQHGLQWPLQRU 0,125LQRGH!LBUGHY

FKDUF

LIPLQRU!

UHWXUQ(12'(9

NIUHHBVVFDOH[BDUHDUHDGBEXIIHU6&$/(;B5($'B%8))(5B6,=(

NIUHHBVVFDOH[BDUHDZULWHBEXIIHU6&$/(;B:5,7(B%8))(5B6,=(

VFDOH[BDUHDUHDGBEXIIHU 18//

VFDOH[BDUHDZULWHBEXIIHU 18//

VFDOH[BDUHDIODJV VFDOH[BDUHDIODJV 6&$/(;B%86<

F LQEBS6&$/(;B&20B%$6( 'LVDEOHLQWHUUXSWV 

F F [I

RXWEBSF6&$/(;B&20B%$6(

UHWXUQ

`

VWDWLFLQWVFDOH[BLRFWOVWUXFWLQRGH LQRGHVWUXFWILOH ILOH

XQVLJQHGLQWFPGXQVLJQHGORQJDUJ

^

XQVLJQHGLQWPLQRU 0,125LQRGH!LBUGHY

LQWVWDWXV

LQWUHWYDO 

LIPLQRU!

UHWXUQ(12'(9

LIVFDOH[BDUHDIODJV 6&$/(;B(;,67 

UHWXUQ(12'(9

VZLWFKFPG^

FDVH6&$/(;5(6(7

VFDOH[BUHVHW

EUHDN

FDVH6&$/(;*(7)/$*6

VWDWXV VFDOH[BDUHDIODJV

LIFRS\BWRBXVHULQW DUJ VWDWXVVL]HRILQW

UHWXUQ()$8/7

EUHDN

GHIDXOW

UHWYDO (,19$/

`

UHWXUQUHWYDO

`

VWDWLFVWUXFWILOHBRSHUDWLRQVVFDOH[BIRSV ^

VFDOH[BOVHHN

VFDOH[BUHDG

VFDOH[ZULWH

18// VFDOH[BUHDGGLU 

18// VFDOH[BSROO 

VFDOH[BLRFWO

18// VFDOH[BPPDS 

VFDOH[BRSHQ

18// IOXVK 

VFDOH[BUHOHDVH

`

LQWVFDOH[BLQLWYRLG

^

LIUHJLVWHUBFKUGHY6&$/(;B0$-25VFDOH[ VFDOH[BIRSV

^

SULQWNVFDOH[XQDEOHWRJHWPDMRUG?Q6&$/(;B0$-25

UHWXUQ(,2

`

LIUHTXHVWBLUTVFDOH[BLQWHUUXSWVFDOH[18//

^

SULQWNVFDOH[XQDEOHWRJHWLUTG?Q

UHWXUQ(,2

`

VFDOH[BDUHDIODJV 6&$/(;B(;,67

UHWXUQ

`

3URJUDP

GHILQH6&$/(;B(;,67[

GHILQH6&$/(;B%86<[

GHILQH6&$/(;B53(1'[

GHILQH6&$/(;B5)8//[

GHILQH6&$/(;B5(55[

GHILQH6&$/(;B&20B%$6([)

GHILQH6&$/(;B&20B%$6([)

GHILQH6&$/(;B,,5B'$7$B,1B)8//

GHILQH6&$/(;B,,5B'$7$B287B(037<

GHILQH6&$/(;B/65B'$7$B,1B)8//

GHILQH6&$/(;B/65B'$7$B287B(037<

GHILQH6&$/(;B:5,7(B6,=(

GHILQH6&$/(;B:5,7(B%8))(5B6,=(

GHILQH6&$/(;B5($'B%8))(5B6,=(

GHILQH6&$/(;B5($'B675,1*B7(50,1$/

 ,2&7/QXPEHUV 

GHILQH6&$/(;5(6(7[F UHVHWVFDOH[ 

GHILQH6&$/(;*(7)/$*6[H JHWVWDWXVIODJV 

GHILQH6&$/(;B:5,7(B%8))(5B6,=(

GHILQH6&$/(;B5($'B%8))(5B6,=(



IXQFWLRQSURWRW\SHV



H[WHUQLQWVFDOH[BLQLWYRLG

)XUWKHU5HDGLQJ

:ULWLQJ8QL['HYLFH'ULYHUV*HRUJH3DMDUL$GGLVRQ:HVOH\

/LQX['HYLFH'ULYHUV$OHVVDQGUR5XELQL2 5HLOO\

&KDSWHU'26352*5$06

/LQX[ZDVZULWWHQIRUWKH7KHUHWDLQVPDQ\RIWKHIHDWXUHVRIWKH6LQFH'26ZDVZULWWHQIRU

WKHWKHUHLVPXFKWREHOHDUQHGDERXWWKHIURPWKHVWXG\RI'26SURJUDPV

7KHHQYLURQPHQWLQZKLFKD'26SURJUDPRSHUDWHVLVYHU\GLIIHUHQWIURPWKHHQYLURQPHQWRID8QL[XVHU

SURJUDP,WLVUHPDUNDEOHWKDWRQHDQGWKHVDPHSURFHVVRUFDQVXVWDLQERWKRIWKHVHHQYLURQPHQWV7KUHH

PDLQGLIIHUHQFHVEHWZHHQWKH'26HQYLURQPHQWDQGWKH8QL[XVHUSURJUDPHQYLURQPHQWDUH

 0HPRU\UHIHUHQFLQJ,Q8QL[PHPRU\DFFHVVLVFRQWUROOHGXVLQJDYLUWXDOPHPRU\V\VWHP,Q/LQX[

YLUWXDOPHPRU\LVEDVHGRQSDJLQJ7KHDSSOLFDWLRQVSURJUDPPHUKDVQRGLUHFWDFFHVVWRSK\VLFDO

PHPRU\,Q'26WKHUHLVQRSDJLQJ.QRZLQJWKHSK\VLFDODGGUHVVRIDPHPRU\ORFDWLRQHQDEOHVWKH

SURJUDPPHUWRZULWHGLUHFWO\WRWKDWORFDWLRQ,WUHTXLUHVPDQLSXODWLRQRIWKHVHJPHQWDWLRQSURFHVVDV

LVH[SODLQHGLQ

FKDSWHU



VHFWLRQ

,Q8QL[WKHDSSOLFDWLRQVSURJUDPPHUPD\LJQRUHWKH

VHJPHQWDWLRQSURFHVVVLQFHIRUXVHUVWKHUHLVMXVWRQHELJVHJPHQWDQGLWLVDOZD\VWKHVDPH

 3ULYLOHJHOHYHO,Q8QL[RQO\V\VWHPSURJUDPVKDYHV\VWHPOHYHOSULYLOHJH8VHUSURJUDPVGRQRW

6WULFWO\VSHDNLQJ'26KDVQRSULYLOHJHOHYHOV%XWDFWXDOO\ZKHQ'26LVUXQQLQJDOOSURJUDPV

H[HFXWHDWHIIHFWLYHO\V\VWHPOHYHOSULYLOHJH/LQX[XVHUSURJUDPVGRQRWFDUU\V\VWHPOHYHOSULYLOHJH

2QHFRQVHTXHQFHRIWKLVLVWKDWWKH\GRQRWKDYHGLUHFW,2DFFHVV7KDWLVWKH\DUHQRWDOORZHGWRXVH

HLWKHUWKH

,1

RUWKH

287

LQVWUXFWLRQV3ULYLOHJHOHYHOVDUHGLVFXVVHGLQ

FKDSWHU



VHFWLRQ



 &RGLQJGHIDXOW[/LQX[SURJUDPVH[HFXWHZLWKDELWFRGLQJGHIDXOW'26SURJUDPVH[HFXWH

ZLWKDELWFRGLQJGHIDXOW&RGLQJGHIDXOWVDUHGLVFXVVHGLQ

FKDSWHU



VHFWLRQ



:KHQ[SURFHVVRUVVWDUWLQJZLWKWKHFUHDWHD'26HQYLURQPHQWWKH\DUHVDLGWREHRSHUDWLQJLQ

UHDOPRGH:KHQQRWLQUHDOPRGHWKH\DUHVDLGWREHLQSURWHFWHGPRGH,Q/LQX[XVHUSURJUDPVDQGPRVW

NHUQHOSURJUDPVUXQLQSURWHFWHGPRGH/LQX[RQO\XVHVUHDOPRGHIRUERRWLQJDQGWKLVLVQHFHVVDU\VLQFH

WKHRQO\ZD\DQ[SURFHVVRUFDQERRWLVLQUHDOPRGH

3ULYLOHJHOHYHOVDQGFRGLQJGHIDXOWVKDYHDOUHDG\EHHQGLVFXVVHGEXWVHJPHQWDWLRQKDVEHHQWRWDOO\LJQRUHG

WRWKLVSRLQW+RZHYHU'26SURJUDPVUHTXLUHLW:HEHJLQRXUGLVFXVVLRQRIVHJPHQWDWLRQZLWKUHDOPRGH

WRWKLVSRLQW+RZHYHU'26SURJUDPVUHTXLUHLW:HEHJLQRXUGLVFXVVLRQRIVHJPHQWDWLRQZLWKUHDOPRGH

VHJPHQWDWLRQ6HJPHQWDWLRQLQSURWHFWHGPRGHLVGLVFXVVHGLQ

FKDSWHU



VHFWLRQ



5HDO0RGH6HJPHQWDWLRQ

7KHWHUPVVHJPHQWDQGVHJPHQWDWLRQDUHXVHGLQPDQ\RYHUODSSLQJDQGFRQIOLFWLQJZD\V&RQVHTXHQWO\LW

ZRXOGEHZHOOWRPDNHDSUHOLPLQDU\DWWHPSWDWFODULI\LQJWHUPLQRORJ\,Q'26FRGHDQGGDWDVHJPHQWVRID

SURJUDPPD\EHVWRUHGLQFRGHDQGGDWDVHJPHQWVRIPHPRU\EXWDUHQ WQHFHVVDULO\,Q/LQX[WKH\QHYHU

DUH7H[WDQGGDWDVHJPHQWVRIDSURJUDPDUHVWRUHGRQVHSDUDWHSDJHVRIPHPRU\QRWVHSDUDWHVHJPHQWVRI

PHPRU\,Q[/LQX[WKHHUURUPHVVDJH6HJPHQWDWLRQ)DXOWGRHVQRWUHIHUWRDVHJPHQWDWLRQIDXOWLW

UHIHUVDSDJHSURWHFWLRQIDXOW:RUVWRIDOOLVWKHWHUPORJLFDOVHJPHQWZKLFKDFFXUDWHO\VSHFLILHVQRWKLQJDW

DOO

7RDYRLGZDQWRQO\PXGG\LQJWKLQJVIXUWKHUWKLVERRNZLOOGRJJHGO\DGKHUHWRWKHIROORZLQJGLVWLQFWLRQV

EHWZHHQSURJUDPVHJPHQWVPHPRU\VHJPHQWVDQGVHJPHQWDWLRQ

6HJPHQWVDQG6HJPHQWDWLRQ

z

3URJUDPVHJPHQW6LQFH

FKDSWHU

ZHKDYHDSSOLHGWKHWHUPVHJPHQWWRDFKXQNRIDQH[HFXWDEOHILOH

7KLVLVVWDQGDUGXVDJH3URJUDPVW\SLFDOO\KDYHWH[WDQGGDWDVHJPHQWV

z

6HJPHQWDWLRQSURFHVV,QWKLVERRNWKHWHUPVHJPHQWDWLRQLVDSSOLHGRQO\WRDQDGGUHVVSURFHVVLQJ

PHFKDQLVPZKLFKKDVWKHHIIHFWRIGLYLGLQJPHPRU\LQWRFKXQNV

z

0HPRU\VHJPHQW,WLVFXVWRPDU\WRDSSO\WKHWHUPVHJPHQWWRWKHFKXQNVRIPHPRU\SURGXFHGE\WKH

VHJPHQWDWLRQSURFHVV,QWKLVERRNPHPRU\VHJPHQWVZLOODOZD\VEHUHIHUUHGWRLQFRQQHFWLRQZLWKD

VSHFLDONLQGRIUHJLVWHUFDOOHGVHJPHQWUHJLVWHU

2QDQ[SURFHVVRUVHJPHQWDWLRQLVFRQWUROOHGE\VHJPHQWUHJLVWHUV

6HJPHQW5HJLVWHUV

2QWKHIRXURIWKHJHQHUDOUHJLVWHUVFDQEHXVHGIRUDGGUHVVHV%;%36,DQG',7KDWLVWKH\FDQEH

XVHGLQEUDFNHWVWRUHIHUWRPHPRU\)RUH[DPSOHWKHFRPPDQGV

029%;+

029$/>%;@

ZRXOGFRS\WKHFRQWHQWVRIRQHPHPRU\ORFDWLRQLQWRWKH$/UHJLVWHU%XW%;%36,DQG',DUHELW

UHJLVWHUVDQGWKHKDVDELWDGGUHVVEXV6RDQDGGUHVVUHJLVWHUFDQRQO\DGGUHVV.RIWKHDYDLODEOH

0HJRIPHPRU\7RJHWDURXQGWKLVSUREOHPWKHGHVLJQHUVRIWKHFUHDWHGVSHFLDOELWUHJLVWHUV

FDOOHGVHJPHQWUHJLVWHUVZKLFKRQWKHVSHFLI\WKHILUVWDGGUHVVRUEDVHDGGUHVVRID.FKXQNRI

PHPRU\2QWKHD.FKXQNRIPHPRU\VSHFLILHGE\DVHJPHQWUHJLVWHULVFDOOHGDPHPRU\VHJPHQW

$QPHPRU\VHJPHQWPD\EHJLQRQDQ\ILYHGLJLWKH[DGGUHVVZKLFKHQGVLQD]HUR7KHILUVWIRXU

GLJLWVRIWKLVDGGUHVVDUHVWRUHGLQWKHDVVRFLDWHGVHJPHQWUHJLVWHU7KHVHJPHQWUHJLVWHUVDUH&6'6

(6DQG667KHPHPRU\VHJPHQWVSHFLILHGE\WKH&6UHJLVWHUIRUH[DPSOHLVFDOOHGWKH&6VHJPHQWFRGH

VHJPHQW2QDQ[SURFHVVRUFRGHLVDOZD\VIHWFKHGIURPWKH&6VHJPHQW/LNHZLVHWKHVWDFNLVDOZD\V

ORFDWHGLQWKH66VHJPHQWVWDFNVHJPHQW7KHDQGVXEVHTXHQW[SURFHVVRUVKDYHWZRDGGLWLRQDO

VHJPHQWUHJLVWHUV)6DQG*6

6HJPHQWUHJLVWHUVPD\EHDFFHVVHGXVLQJWKHFRPPDQG

029UHJUHJ

ZKHUHRQHUHJLVWHULVDQ\ELWJHQHUDOUHJLVWHUDQGWKHRWKHUPD\EHDQ\VHJPHQWUHJLVWHU$QH[FHSWLRQLV

WKDW&6PD\QRWEHXVHGDVWKHGHVWLQDWLRQUHJLVWHU6LQFHLQVWUXFWLRQVDUHIHWFKHGIURPWKH&6VHJPHQW

VWRULQJDQHZYDOXHLQ&6ZRXOGKDYHWKHGUDVWLFHIIHFWRIFKDQJLQJWKHVHJPHQWWKDWFRGHLVEHLQJIHWFKHG

IURP$MXPSWRDGLIIHUHQWVHJPHQWLVFDOOHGDIDUMXPS&DUU\LQJRXWDIDUMXPSUHTXLUHVDVSHFLDO

FRPPDQG,QWUDVHJPHQWMXPSVDUHFDOOHGQHDUMXPSV

FRPPDQG,QWUDVHJPHQWMXPSVDUHFDOOHGQHDUMXPSV

7KHUHLVQRORDGLPPHGLDWHFRPPDQGIRUVHJPHQWUHJLVWHUV7KHIROORZLQJFRPPDQGIRUH[DPSOHLV

LOOHJDO

029'6+

6XSSRVHWKDW'6(6DQG66KDYHYDOXHVVWRUHGLQWKHPYLDWKHIROORZLQJFRPPDQGV

029$;+

029'6$;

029$;+

029(6$;

029$;&+

02966$;

6RWKHQ'6KROGV+(6KROGV+DQG66KROGV&+

)LJXUH

VKRZVWKHWKUHHVHJPHQWV

ZKLFKDUHHQDEOHGE\WKHVHWKUHHUHJLVWHUORDGV7KHHQWLUHPHPRU\FRQVLVWVRIWKHDGGUHVVHVIURPWKURXJK

)))))+7KH'6VHJPHQWFRQVLVWVRIWKHDGGUHVVHVIURP+WKURXJK))))+7KH(6VHJPHQWUDQJHV

IURP+WKURXJK))))+7KH66VHJPHQWJRHVIURP&+WKURXJK')))+

)LJXUH0HPRU\ZLWK7KUHH'LVWLQJXLVKHG6HJPHQWV

6HJPHQW2IIVHW1RWDWLRQ

6XSSRVHQRZWKDWZHZRXOGOLNHWRUHIHUWRWKHPHPRU\ZKRVHDGGUHVVLV+LQDQDVVHPEOHU

FRPPDQG7KLVDGGUHVVOLHVLQWKH'6VHJPHQW7KLVLVEHFDXVH+ZDVMXVWVWRUHGLQWKH'6UHJLVWHU,W

LV+E\WHVIURPWKHEDVHDGGUHVV7KLVGLIIHUHQFHWKHDGGUHVVPLQXVWKHEDVHDGGUHVVLVFDOOHGWKH

RIIVHW7KHVHJPHQWRIIVHWSDLULVRIWHQXVHGLQWKHDVVHPEO\ODQJXDJHDVIROORZV

029%/'6>+@

,Q1$60WKHV\QWD[LV

029%/>'6+@

7KLVFRPPDQGORDGVWKHFRQWHQWVRIPHPRU\ORFDWLRQ+LQWR%/+ ++1RWH

WKDWWKHEDVHDGGUHVVLWVHOILVDILYHGLJLWKH[QXPEHUHYHQWKRXJK'6RQO\KROGVIRXUGLJLWVLQWKLVFDVH

+

7KHDGGUHVV+LVDSK\VLFDODGGUHVVQRWDYLUWXDODGGUHVV7KHELWVZKLFKWKHSURFHVVRUSXPSVRXW

RQWRWKHDGGUHVVEXVPD\EHUHDGRIIWKHELQDU\QXPEHU



7KHVDPHPHPRU\UHDGFRXOGEHDFFRPSOLVKHGXVLQJDELWDGGUHVVUHJLVWHUDVIROORZV

029%;+

029%/>'6%;@

%;%36,DQG',PD\EHXVHGIRUDGGUHVVLQJLQWKLVZD\EXW63$;&;DQG';PD\QRW

'HIDXOW6HJPHQWV

6HJPHQWGHVLJQDWLRQVPD\EHRPLWWHG7KHUHLVDOZD\VDGHIDXOWVHJPHQW5HIHUULQJWR

7DEOH

ZHVHH

WKDWWKHGHIDXOWVHJPHQWIRUDQLPPHGLDWHDGGUHVVLVWKH'6VHJPHQW+HQFHWKHFRPPDQG

029%/>+@

DOVRDFFRPSOLVKHVWKHVDPHORDGDVWKH

029%/>'6%;@

LQVWUXFWLRQ6RGRWKHFRPPDQGV

029%;+

029%/>%;@

7DEOH'HIDXOW6HJPHQWV

ELWDGGUHVV

ELWDGGUHVV

>LPP@

'6

>LPP@

'6

>($;@

'6

>$;@

LOOHJDO

>@

(6ZLWKVWULQJLQVWUXFWLRQV

7KHGHIDXOWVHJPHQWIRUERWKLPPHGLDWHDGGUHVVHVDQGIRUDGGUHVVHVVWRUHGLQWKH%;UHJLVWHULVWKH'6

VHJPHQW

'HIDXOWVHJPHQWVH[LVWLQELWFRGHDVZHOO,QIDFWWKDWLVZKDWPDNHVLWSRVVLEOHWRGRSURJUDPPLQJ

ZLWKRXWUHIHUHQFHWRVHJPHQWVDVLVGRQHLQ

FKDSWHU

7KH/LQX[SURJUDPVWKHUHDOOPDNHXVHRIDGHIDXOW

VHJPHQW,WLVDFWXDOO\D*LJVHJPHQW6HWWLQJXSELJVHJPHQWVOLNHWKLVLVGLVFXVVHGLQ

FKDSWHU

,Q[

/LQX[WKH&6'6(6DQG66VHJPHQWVDOOUHIHUWRWKHVDPH*LJVHJPHQW6RWKHSURJUDPPHUKDVQR

RSWLRQVDQGWKHGHIDXOWVHJPHQWLVDOZD\VRND\

(GOLQDV(QYLURQPHQW9DULDEOHV

0DQ\DVVHPEOHUVKDYHGLUHFWLYHVZKLFKDOORZYDULDEOHVWREHGHILQHGDQGWKHQXVHGLQVXEVHTXHQW

H[SUHVVLRQV,Q1$60WKHV\QWD[IRUVXFKDGLUHFWLYHLV

,Q(GOLQDVLWLV

,Q(GOLQDVWKHUHDUHEXLOWLQYDULDEOHVZKRVHYDOXHVFRQWUROWKHEHKDYLRURIWKHDVVHPEOHUDQGWKHVLPXODWRU

2QHRIWKHVHLV86(ZKLFKGHWHUPLQHVZKHWKHUWKHDVVHPEOHUXVHVELWRUELWFRGLQJ7KHGHIDXOWLV

'26SURJUDPVUHTXLUH

1$60XVHVDGLUHFWLYHFDOOHG

%,76

)RUH[DPSOHWRVSHFLI\ELWFRGHLQ1$60WKHOLQH

%,76

GRHVWKHWULFN$QRWKHUHQYLURQPHQWYDULDEOHLV

'272

,WGHWHUPLQHVWKHIRUPDWRI

R

ILOHVVDYHGE\(GOLQDV

7KHGHIDXOWLV

(/)'26

QHHGVWKH

&20

IRUPDW

1$60JRYHUQVWKHIRUPDWRIWKHRXWSXWILOHXVLQJDFRPPDQGOLQHVZLWFK7RJHWD

&20

IRUPDWLQ1$60

WKH

IELQ

VZLWFKZRUNV,WLVDOVRWKHGHIDXOWVRWKDWQRVZLWFKDWDOOZLOOGRWKHVDPHWKLQJ$ILOHZLWKWKLV

IRUPDWKDVHVVHQWLDOO\QRH[WUDFRGHDWDOO,WLVMXVWDSODLQELQDU\ILOH

(GOLQDVHQYLURQPHQWYDULDEOHVPD\DOVREHGHILQHGLQDQ('/,1,ILOHRUIURPWKH!SURPSW

)L[HG0HPRU\$UHDV

>($;@

'6

>$;@

LOOHJDO

>(%;@

'6

>%;@

'6

>(&;@

'6

>&;@

LOOHJDO

>(';@

'6

>';@

LOOHJDO

>(6,@

'6

>6,@

'6

>(',@

'6

>@

>',@

'6

>@

>(63@

66

>63@

66

>(%3@

66

>%3@

66

)L[HG0HPRU\$UHDV

5HDOPRGHDOORZVWKHSURJUDPPHUWRXVHSK\VLFDOPHPRU\DGGUHVVHV0HPRU\DGGUHVVHVVSHFLILHGLQUHDO

PRGHDUHXVHGRQWKHDGGUHVVEXVMXVWOLNH,2DGGUHVVHV7KLVJLYHVWKHSURJUDPPHUXQLPSHGHGDFFHVVWR

PHPRU\,QWKLVVHFWLRQDVDQH[HUFLVHLQWKHXVHRIUHDOPRGHDGGUHVVHVZHFRQVLGHUWZRDUHDVRIPHPRU\

ZKLFKDUHGHILQHGE\IL[HGSK\VLFDODGGUHVVHVWKHYLGHREXIIHUDQGWKHNH\ERDUGEXIIHU7KHORFDWLRQRIWKH

YLGHREXIIHULVIL[HGLQWKHKDUGZDUH%XWWKHNH\ERDUGEXIIHULVRQO\IL[HGE\'26DQGKHQFHLWFDQEH

PRYHG5HIHUULQJWR

)LJXUH

SURJUDPVZKLFKDFFHVVWKHVHSK\VLFDOPHPRU\DUHDVGLUHFWO\DUHGHILQLWHO\

UXGHSURJUDPVDVRSSRVHGWRSROLWHSURJUDPV

)LJXUH8QSURWHFWHG2SHUDWLQJ6\VWHPVXFKDV'26

9LGHR%XIIHU

2QVWDQGDUG3&VWKHUHLVDUHJLRQRIPHPRU\VWDUWLQJDWWKHDGGUHVV%+FDOOHGWKHYLGHREXIIHU,QWKH

PRVWFRPPRQO\XVHGYLGHRWH[WPRGHWKHYLGHREXIIHUKROGVWKHWH[WLQIRUPDWLRQZKLFKLVGLVSOD\HGRQWKH

VFUHHQ$YHU\VLPSOHEXWVRPHZKDWWHGLRXVZD\WRRXWSXWLQIRUPDWLRQRQD3&LVWRVWRUH$6&,,FRGHVLQ

WKLVEXIIHU6HH

7DEOH



7KHDGGUHVV%+LVWKHDFWXDOO\DGGUHVVRIWKH$6&,,FRGHIRUWKHFKDUDFWHULQWKHXSSHUOHIWKDQGFRUQHU

RIWKHVFUHHQ6HH

)LJXUH

7KHQH[WE\WHZKLFKLVDW%+FRQWDLQVWKHDWWULEXWHLQIRUPDWLRQIRUWKLV

VDPHFKDUDFWHU

7DEOH

VKRZVKRZWKHHLJKWELWVRIDQDWWULEXWHE\WHDUHXVHG%+LVWKH$6&,,FRGH

RIWKHVHFRQGFKDUDFWHULQWKHILUVWURZ%+LVLWVDWWULEXWHE\WHDQGVRRQ7KHWRSURZFRQVLVWVRI

FKDUDFWHUVRUE\WHVVLQFHHDFKFKDUDFWHUWDNHVWZRE\WHVRIVWRUDJH2QHVFUHHQIXOLVURZVî

FROXPQVîE\WHVSHUFKDUDFWHU E\WHV7KHEXIIHUDFWXDOO\FRQWDLQVE\WHV +

)LJXUH8SSHU/HIWDW%WKURXJK/RZHU5LJKWDW%)(

3URJUDP

SULQWV+HOORRQWKHVFUHHQE\VWRULQJILYH$6&,,FRGHVLQWRWKHYLGHREXIIHU)LJXULQJWKH

DGGUHVVRIWKHWKLUW\VHYHQWKFKDUDFWHURQOLQHLQKH[

3URJUDP

LVDOLWWOHE\WHSURJUDPZKLFKFRORUVWKHVFUHHQ\HOORZRQEOXHE\ZULWLQJWRDOOWKH

DWWULEXWHE\WHVLQWKHYLGHREXIIHU,WEHJLQVDW)))+DQGFRXQWVGRZQE\WZRV

.H\ERDUG%XIIHU

:KHQDNH\LVHLWKHUSUHVVHGRUUHOHDVHGDQLQWHUUXSWLVJHQHUDWHG2QDQ,6$PDFKLQHWKLVLQWHUUXSWLV

DOORWWHG,54ZKLFKLQWXUQLVUHSRUWHGE\WKHLQWHUUXSWFRQWUROOHUDVLQWHUUXSWQXPEHU6HH

7DEOH



7KH'26LQWHUUXSWVHUYLFHURXWLQHLQWHUURJDWHVWKHNH\ERDUGDW,2SRUW+DQGGHSRVLWVFKDUDFWHUVLW

UHFHLYHVIURPWKHUHLQDWLQ\EXIIHUORFDWHGDW(+7KH

FKDUDFWHUVFRPHLQIURPWKHNH\ERDUGDVVFDQFRGHV7KH,65FRQYHUWVHDFKVFDQFRGHWRDQ$6&,,FKDUDFWHU

DQGVWRUHVERWKDVFDQFRGHDQGDQ$6&,,FRGHLQWKH

3URJUDP

86( 

'272 &20



:ULWH+HOORE\VWRULQJ$6&,,FRGHVLQWRWKHYLGHREXIIHU



029$;2%+)LUVWGLJLWVRI%+

029'6$;

029',/DVWGLJLWRI%+

029$+$6&,,IRU+

029>',@$+6WRUHWKHFKDUDFWHU

$''',1H[WRGGDGGUHVV

029$+$6&,,IRUH

029>',@$+6WRUHWKHFKDUDFWHU

$''',

029$+$6&,,IRU

029>',@$+6WRUHWKHFKDUDFWHU

$''',

029$+$6&,,IRU

029>',@$+6WRUHWKHFKDUDFWHU

$''',

029$+$6&,,IRUR

029>',@$+6WRUHWKHFKDUDFWHU

5(75HWXUQWR'26

EXIIHU)URPWKLVEXIIHUWKHNH\VDUHSLFNHGXSE\WKHDSSOLFDWLRQSURJUDPRUWKHFRPPDQGOLQHLQWHUSUHWHU

7KHWZRE\WHVVWRUHGDW$SRLQWWRWKHQH[WGHSDUWLQJE\WHV,Q

)LJXUH

WKHUHLVRQHNH\ZDLWLQJWREH

SLFNHGXS,WLVWKHOHWWHU&ZKRVH$6&,,FRGHLV+(LVLWVVFDQFRGH7KHWZRE\WHVVWRUHGDW&SRLQW

WRWKHORFDWLRQZKHUHWKHQH[WDUULYLQJE\WHVZLOOEHVWRUHG6LQFHWKHGHSDUWLQJSRLQWHULVRQO\WZRE\WHV

EHKLQGWKHDUULYDOSRLQWHUWKLVPHDQVWKHUHLVRQO\RQHFKDUDFWHULQWKHEXIIHU&LQWKLVFDVH%RWKSRLQWHUV

ZUDSDURXQGZKHQWKH\UHDFK()RUWKLVUHDVRQWKHEXIIHULVFDOOHGDFLUFXODUEXIIHU

)LJXUH'26.H\ERDUG%XIIHU

3URJUDP

VWRUHVWKHVWULQJ

',5

LQWRWKHNH\ERDUGEXIIHU

5HDO0RGH,QWHUUXSWV

:KHQSROLWHXVHUSURJUDPVZDQWDFFHVVWRSHULSKHUDOVWKH\FDOOWKHRSHUDWLQJV\VWHP,QDSURWHFWHG

RSHUDWLQJV\VWHPWKHUHLVQRFKRLFHDERXWWKLV,QDQXQSURWHFWHGRSHUDWLQJV\VWHPOLNH'26WKHFDOOWRWKH

RSHUDWLQJV\VWHPLVRSWLRQDO6HH

)LJXUH

-XVWDVWKHSURJUDPVLQ

VHFWLRQ

DFFHVVHGSHULSKHUDOVE\

EDUJLQJ

3URJUDP

86( 

'272 &20

029$;2%+9LGHREXIIHUEHJLQVDW%+

029'6$;

029%;2)))+2GGDGGUHVVHQGLQJWKH.EXIIHU

029$+(+<HOORZRQEOXH

$*1029>%;@$+$WWULEXWHJRHVLQWRRGGDGGUHVV

'(&%;*HWQH[W

'(&%;RGGDGGUHVV

-16$*1&RQWLQXHWLOOWKHEHJLQQLQJRIWKHEXIIHU

5(75HWXUQWR'26

LQRQWKHLUSULYDWHPHPRU\VSDFHUXGHSURJUDPVFDQDOVRDFFHVVSHULSKHUDOVE\XVLQJXVLQJ

,1

DQG

287

LQVWUXFWLRQV

/LNH/LQX[WKH'26RSHUDWLQJV\VWHPLVDFFHVVHGXVLQJVRIWZDUHLQWHUUXSWV7KHLQWHUUXSWPRVWXVHGIRU

DFFHVVWR'26LV

,17+

7RFDOORQHRIWKHIXQFWLRQVDYDLODEOHXQGHU

,17+

LWVQXPEHULVVWRUHGLQWKH

$+UHJLVWHUEHIRUHWKHLQWHUUXSWLVFDOOHG

'26,QWHUUXSWV

7RFDOOWKH'26IXQFWLRQZKLFKRXWSXWVDFKDUDFWHUWRWKHFXUVRUORFDWLRQRQWKHVFUHHQWKHIXQFWLRQQXPEHU

LVVWRUHGLQWKH$+UHJLVWHUDQGWKH$6&,,FRGHRIWKHFKDUDFWHUWREHSULQWHGLVVWRUHGLQWKH'/UHJLVWHU



7DEOH

VKRZVWKH$6&,,FRGH)RUH[DPSOHWKHIROORZLQJFRGHZRXOGSULQWWKHOHWWHU+

3URJUDP

029$+

029'/$6&,,FRGHIRU+

,17+

86( 

'272 &20

029$;+0DNH+WKHEDVHDGGUHVV

029'6$;RIWKH'6VHJPHQW

029'/K$6&,,FRGHIRU '

7DEOH$WWULEXWH%\WH<HOORZRQ%OXHLV(+

%LW

8VDJH

([DPSOH



%OLQNLQJ





%DFNJURXQG5HG





%DFNJURXQG*UHHQ





%DFNJURXQG%OXH





)RUHJURXQG,QWHQVLW\





)RUHJURXQG5HG





)RUHJURXQG*UHHQ





)RUHJURXQG%OXH



029'/K$6&,,FRGHIRU '

&$//&67

029'/+$6&,,FRGHIRU ,

&$//&67

029'/+$6&,,FRGHIRU 5

&$//&67

5(7

&670296,>&+@3RLQWHUWRHQGRINH\ERDUGEXIIHU

029>6,@'/6WRUHWKHFKDUDFWHULQWRWKHEXIIHU

68%6,&+

$1'6,$GGPRGWR6,(+

$''6,(+

029>&+@6,6WRUHWKHUHYLVHGSRLQWHU

5(7

$UHODWHG'26IXQFWLRQZKLFKRXWSXWVDVWULQJRIFKDUDFWHUVFDQEHFDOOHGXVLQJ$+ 7KHVHJPHQWRIIVHW

DGGUHVVRIWKHVWULQJLVVWRUHGLQ'6';7KHVWULQJPXVWEHWHUPLQDWHGE\DGROODUVLJQFKDUDFWHU$6&,,

+

0DQ\RIWKHVH'26IXQFWLRQVFDOOSURJUDPVVWRUHGLQ5207KH\DUHRIWHQFDOOHG%,26SURJUDPV0DQ\

%,26LQWHUUXSWVDUHDFFHVVHGXVLQJ

,17+

RU

,17+

%,26,QWHUUXSWV

7RFDOOWKH%,26IXQFWLRQWRRXWSXWDFKDUDFWHUWRWKHFXUVRUORFDWLRQRQWKHVFUHHQWKHIXQFWLRQQXPEHU

$+LVVWRUHGLQWKH$+UHJLVWHUDQGWKH$6&,,FRGHRIWKHFKDUDFWHUWREHSULQWHGLVVWRUHGLQ'/7KH

QXPEHURIWLPHVWKHFKDUDFWHULVWREHZULWWHQLVVWRUHGLQ&;

029$+

029'/$6&,,FRGHIRU+

029&;1XPEHURIWLPHV+LVSULQWHG

029%+&XUUHQWSDJH

,17+

7KH%+UHJLVWHUQHHGVDLQRUGHUWRVHQGWKHRXWSXWWRWKHYLGHREXIIHUGHVFULEHGLQ

VHFWLRQ

7KHUHLV

XVXDOO\DQRWKHU.YLGHREXIIHUVWDUWLQJDW%+7RDFFHVVWKLVEXIIHUDVKRXOGEHVWRUHGLQ%+(DFK

RIWKHVHEXIIHUVLVFDOOHGDSDJH

7KHVHSDJHVPDNHLWSRVVLEOHWRIOLSIURPRQHVFUHHQWRDQRWKHUZLWKRXWFRS\LQJ.RIPHPRU\7KH'26

IXQFWLRQFDOOWDNHVUHVSRQVLELOLW\IRUDFFHVVLQJWKHFXUUHQWSDJHWKH%,26FDOOGRHVQRW

)LJXUH

LOOXVWUDWHVWKHW\SLFDOVHTXHQFHRIIXQFWLRQFDOOV7KHIDFWWKDW'26SURJUDPVFDOO%,26

SURJUDPVDQGQRWGLUHFWO\WRWKHKDUGZDUHOHDYHVKDUGZDUHGHVLJQHUVIUHHWRPDNHDWOHDVWPLQRUFKDQJHVLQ

WKHLUKDUGZDUHZLWKRXWWKHQHFHVVLW\IRUFKDQJHVLQ'26%\UHYLVLQJWKH%,26SURJUDPVVRDVWRPDLQWDLQ

WKHVDPHIXQFWLRQDOLW\RI%,26LQWHUUXSWVFKDQJHVLQ'26EHFRPHXQQHFHVVDU\6LPLODUO\FKDQJHVLQ'26

FDQEHDFFRPSOLVKHGZLWKRXWGLVUXSWLQJDSSOLFDWLRQVSURJUDPVSURYLGHGWKDWWKH'26LQWHUUXSWLVUHZULWWHQ

VRWKDWLWDIIRUGVWKHVDPHIXQFWLRQDOLW\WRWKHDSSOLFDWLRQVSURJUDP7KHVHOD\HUVDIIRUGDSSOLFDWLRQV

SURJUDPPHUVV\VWHPVSURJUDPPHUVDQGKDUGZDUHGHVLJQHUVDPRGHVWGHJUHHRILQGHSHQGHQFHIURPRQH

DQRWKHU

)LJXUH'260HPRU\DQG3HULSKHUDO$FFHVV

8VHUSURJUDPVZKLFKE\SDVVRQHRUPRUHRIWKHVHOD\HUVULVNDORVVLQSRUWDELOLW\$SURJUDPZKLFKFDOOV

GLUHFWO\WRWKHKDUGZDUHPD\QRWUXQRQDPDFKLQHZLWKGLIIHUHQWKDUGZDUH7KHVWURQJHVWUHDVRQDVRIWZDUH

GHYHORSHUKDVIRUVDFULILFLQJSRUWDELOLW\LVWKDWE\SDVVLQJVRIWZDUHOD\HUVUHGXFHVH[HFXWLRQWLPH([HFXWLRQ

WLPHLVVWLOODSUREOHPLQFRQQHFWLRQZLWKYLGHRSURFHVVLQJ7KDWLVRQHUHDVRQWKDWWKHYLGHREXIIHUEHFDPH

VWDQGDUGL]HG6RPXFKVRIWZDUHZURWHWRLWGLUHFWO\WKDWPRYLQJLWZRXOGKDYHPDGHWKHJUDSKLFVKDUGZDUH

ZLWKWKHROGYLGHREXIIHUPLVVLQJGLIILFXOWWRVHOO

7KH5HDO0RGH,QWHUUXSW7DEOH

:KHQDQLQWHUUXSWRFFXUVWKHLQWHUUXSWQXPEHULVXVHGDVDQLQGH[LQWRWKHLQWHUUXSWWDEOH7KHLQWHUUXSW

WDEOHFRQWDLQVWKHORFDWLRQVRIDOOWKHVHUYLFHURXWLQHV7KHILUVWHQWU\LQWKHWDEOHLVIRULQWHUUXSWQXPEHU

WKHVHFRQGLVIRULQWHUUXSWQXPEHUHWF7KH/LQX[LQWHUUXSWWDEOHLVGHVFULEHGEULHIO\LQ

FKDSWHU



VHFWLRQ



7KHUHDOPRGHLQWHUUXSWWDEOHGLIIHUVIURPWKHSURWHFWHGPRGHLQWHUUXSWWDEOHXVHGE\/LQX[LQVHYHUDO

UHVSHFWV

)LJXUH5HDO0RGH,QWHUUXSW7DEOH

(YHU\HQWU\LQWKHUHDOPRGHLQWHUUXSWWDEOHRFFXSLHVIRXUE\WHV7KHILUVWWZRE\WHVDUHDOLWWOHHQGLDQRIIVHW

YDOXHDQGWKHQH[WWZRDUHDOLWWOHHQGLDQVHJPHQWYDOXHGHVLJQDWLRQ

YDOXHDQGWKHQH[WWZRDUHDOLWWOHHQGLDQVHJPHQWYDOXHGHVLJQDWLRQ

,QUHDOPRGHWKHWDEOHLVFXVWRPDULO\ORFDWHGVWDUWLQJDWDGGUHVV]HURLQPHPRU\6RWKHDGGUHVVRIWKH

LQWHUUXSWVHUYLFHURXWLQHIRULQWHUUXSWLVVWRUHGLQE\WHVWKURXJK7KHDGGUHVVRIWKHURXWLQHIRULQWHUUXSW

LVVWRUHGLQE\WHVWKURXJK,QJHQHUDOLIQLVWKHQXPEHURIDQLQWHUUXSWWKHQWKHDGGUHVVRIWKHHQWU\

QXPEHUQLQWKHLQWHUUXSWWDEOHLVîQ)RUH[DPSOHLIWKHLQWHUUXSWQXPEHULV+WKHQWKHDGGUHVVRIWKH

,65LVWREHIRXQGLQE\WHV&&+WR&)+7KHODUJHVWYDOLGLQWHUUXSWQXPEHULV7KHDGGUHVVIRUWKDW

URXWLQHLVVWRUHGLQE\WHVWKURXJKRU)&+WKURXJK))+î 

,QWHUUXSW9HFWRUV

7KHWHUPLQWHUUXSWYHFWRULVRIWHQXVHGLQFRQQHFWLRQZLWKWKLVWDEOH8QIRUWXQDWHO\PDQ\FRQIOLFWLQJ

PHDQLQJVRIWKHWHUPDUHLQXVH7KHWHUPKDVEHHQXVHGWRPHDQ

z

WKHLQWHUUXSWWDEOHLWVHOI

z

RQHRIWKHHQWULHVFRQWDLQHGLQWKHWDEOH

z

DPHPRU\ORFDWLRQFRQWDLQLQJDQHQWU\LQWKHWDEOH

z

DQXPEHULQWKHUDQJHXVHGDVDQLQGH[LQWRWKHWDEOH

7KHWHUPKDVEHHQGDPDJHGEH\RQGUHSDLUDQGLWLVEHVWWRMXVWQRWXVHLWDQ\PRUH

.QRZOHGJHRIWKLVWDEOHPDNHVLWSRVVLEOHWRZULWHDSURJUDPZKLFKVXSHUFHGHVD'26RU%,26LQWHUUXSW

%\FKDQJLQJWKHVWRUHG,65DGGUHVVIURPWKDWRIWKH'26RU%,26LQWHUUXSWWKHQHZSURJUDPFDQWDNHWKH

SODFHRIWKHROGRQH$QHZSURJUDPFDQDOVRLQVHUWLWVHOIDVDOD\HUE\FDOOLQJWKHROGSURJUDPDIWHULWKDV

GRQHZKDWHYHULWZDQWVZLWKWKHRULJLQDOIXQFWLRQFDOO

&KHFNLQJ'260HPRU\

2QHVLPSOHEXWXVHIXODSSOLFDWLRQRIWKHVKLIWFRPPDQGVLVWKHFRQYHUVLRQRIWKHFRQWHQWVRIDUHJLVWHULQWRD

IRXUGLJLWVHTXHQFHRIKH[FKDUDFWHUV)RUH[DPSOHWRSULQWRXWWKHILUVWGLJLWRIWKHQXPEHUVWRUHGLQ%;

VD\&'+ZHFDQPDNHDFRS\RI%;DQGVKLIWLWELWVWRWKHULJKWDQGJHW+7KH$6&,,FRGHIRU

LV+ +:HFDQWKHQVHQGWKLVFRGHWRWKHVFUHHQHLWKHUGLUHFWO\XVLQJWKHYLGHREXIIHUDVLQ

VHFWLRQ

RUDVDQLQWHUUXSWDVLQ

VHFWLRQ

7RJHWWKHVHFRQGGLJLWZHFDQVKLIWDFRS\RI%;HLJKW

ELWVWRWKHULJKWDQGJHW&+7RPDVNRXWDOOEXWWKHERWWRPIRXUELWVZHFDQ$1'ZLWK)+

3URJUDP

XVHVWKLVVLPSOHUHJLVWHUFRQYHUVLRQWRGLVSOD\WKHUHJLRQVRIWKH0HJ'26PHPRU\ZKLFK

DUH520,WZRUNVE\FKHFNLQJHYHU\WKE\WHLQPHPRU\7KHIDFWWKDWWKHSURJUDPVZHHSVWKURXJKWKH

HQWLUHPHPRU\PHDQVWKDWDWVRPHSRLQWLWEHFRPHVVHOIPRGLI\LQJFRGH7KHFULWLFDOOLQHVZKHUHFRGHLV

PRGLILHGLQ

3URJUDP

VSDQIURPWKHLQVWUXFWLRQV

029>',@'/

WRWKH

'(&%<7(>',@

LQVWUXFWLRQ7KH

YDOXHVWRUHGLQ',DWWKHEHJLQQLQJPXVWEHFKRVHQVRWKDWWKHPRGLILHGE\WHVVNLSRYHUWKLVFULWLFDOVHFWLRQ

RIFRGH,WVRKDSSHQVWKDWZRUNVZLWKWKLVFRGH7RVHHZK\\RXFDQFKHFNWKHKH[FRGHWRILQGWKH

DGGUHVVHVRIWKLVFULWLFDOVHFWLRQRIFRGH<RXFDQXVH(GOLQDVWRGRWKLVRUWKH'26SURJUDP'(%8*RUD

KH[HGLWRU%RWK(PDFVDQGWKHWKH

HOYLV

FORQHRI

YL

FDQEHXVHGDVKH[HGLWRUV,QWKLVFDVHWKHDGGUHVVHV

DUHIURP+WR%+VRZRUNVILQH

3URJUDP

SULQWVRXW520DQG5$0RQHOHWWHUDWDWLPH7KH\FDQDOVREHSULQWHGRXWDVVWULQJV'26

LQWHUUXSW+XVLQJ$+ ZLOOSULQWRXWDVWULQJZKLFKHQGVLQDFKDUDFWHUDQGZKRVHVWDUWLQJDGGUHVVLV

VWRUHGLQ';,QVWHDGRIXVLQJ

029';$%&



$%&GE 5$0

WRVWRUHDSRLQWHUWRWKHVWULQJZHQHHGWRDGGWKHRIIVHWRIWKHEHJLQQLQJRIWKHSURJUDPWR';'26

ORDGV&20SURJUDPVDWDQRIIVHWRI+6RWKHFRGHVKRZQZRUNVLIWKH

029

LQVWUXFWLRQLVIROORZHGE\

$''';+

$''';+

$VDPSOHUXQRI

3URJUDP

SURGXFHVDQRXWSXWVXFKDV

3URJUDP

5$0

520$

5$0%

520&

0DS5$0YV520LQ'26 V0HJ



%,76'26SURJUDPVXVHDELWFRGLQJGHIDXOW

029$+$+ IRU'26YLGHRRXWSXWLQWHUUXSW

;25%/%/%/ 5$0520FKHFN 5$0 520

029',',LVZKLFKE\WHRXWRIHDFKWRFKHFN

;256,6,6, 6WDUWDWWKHEHJLQQLQJRIPHPRU\

723029'66,

029%+%/6DYHSUHYLRXV5$0520LQGLFDWLRQLQ%+

;25%/%/%/ XQOHVVLQFUHPHQWHGEHORZ

029'/>',@*HWPHPRU\YDOXH

,1&'/&KDQJHLW

029>',@'/7U\VWRULQJWKHFKDQJHGYDOXH

&03>',@'/6HHLILWZRUNHG

-1(520,IWKH\ UHQRWHTXDOLW V520

'(&%<7(>',@4XLFN3XWEDFNRULJLQDOYDOXH

,1&%/ 5$0 520

520&03%+%/&RPSDUHROGZLWKQHZYDOXH

-*352&KDQJHGIURP5$0WR520VRSULQW520

-/35$&KDQJHGIURP520WR5$0VRSULQW5$0

,1&6,,QFUHPHQWPDLQORRSFRXQWHU

%27-1=723

'815(7$OOGRQH



352029'/ 5  5 3ULQWVWDUWRI520

,17+

029'/ 2 

,17+

-0305*

35$029'/ 5  5 3ULQWVWDUWRI5$0

,17+

029'/ $  $

,17+

05*029'/ 0  0

,17+

029'/VSDFH!

,17+

029&/3UHSDUHWRSULQWIRXUGLJLWV

35/029';',

6+5';&/

$1'';0DVNHYHU\WKLQJH[FHSWKH[RQH VGLJLW

&03'/'RHVWKLVSULQWDVDQXPHUDORUDVDOHWWHU"

-/10/

$'''//HWWHUVQHHGDQH[WUDVHYHQ

10/$'''/+

,17+3ULQWKH[GLJLW

68%&/

-*(35/

029'/  )LIWKGLJLWLV

,17+

029'/&DUULDJHUHWXUQ

,17+

029'/1HHGDQ(2/WRR

,17+

5(7

)XUWKHU5HDGLQJ

$GYDQFHG$VVHPEO\/DQJXDJH3URJUDPPLQJ$OLHQ:\DWW6U4XH

&KDSWHU/,18;%2277,0(352*5$06

,Q

FKDSWHU

ZHGLVFXVVHGWKHPDLQGLIIHUHQFHVEHWZHHQWKHHQYLURQPHQWSURYLGHGWRXVHUSURJUDPVZKLFK

UXQXQGHU/LQX[DQGWKHHQYLURQPHQWXQGHUZKLFK'26SURJUDPVUXQ:HVDZKRZYHU\GLIIHUHQWWKHVHWZR

HQYLURQPHQWVDUH0XFKRIWKHGLIIHUHQFHEHWZHHQWKHVHWZRHQYLURQPHQWVLVGXHWRWKHIDFWWKDWDGLIIHUHQW

RSHUDWLQJV\VWHPLVUXQQLQJLQHDFK%XWWKHUHLVDOVRDGLIIHUHQFHDWWKHKDUGZDUHOHYHO'26ZDVZULWWHQIRU

WKHSURFHVVRU,QRUGHUIRU'26WRUXQRQDPDFKLQHWKDWPDFKLQHPXVWDFWOLNHDQ/LQX[LVD

PXOWLWDVNLQJV\VWHP,QRUGHUIRULWWRUXQRQDPDFKLQHWKDWPDFKLQHPXVWKDYHKDUGZDUHVXSSRUWIRUWKH

SURWHFWLRQRIRQHWDVNIURPDQRWKHU7KH[SURFHVVRUVIURPWKHRQVXSSRUWERWKRIWKHVHRSHUDWLQJ

V\VWHPVE\UXQQLQJLQWZRGLVWLQFWRSHUDWLQJPRGHVUHDOPRGHZKLFKHPXODWHVDQDQGSURWHFWHGPRGH

ZKLFKKDVPXOWLWDVNLQJVXSSRUW

&KDQJLQJWR3URWHFWHG0RGH

:KHWKHUDQ[SURFHVVRUUXQVLQUHDORUSURWHFWHGPRGHLVGHWHUPLQHGE\WKHERWWRPELWRIWKH&5

UHJLVWHU7KLVUHJLVWHULVDELWH[WHQVLRQRIWKHELW0DFKLQH6WDWXV:RUGUHJLVWHURQWKH7KH

OHDVWVLJQLILFDQWELWLQWKLVUHJLVWHULVDFWXDOO\WKHPRVWVLJQLILFDQWELWRQWKHHQWLUHSURFHVVRU,ILWLVFOHDUHG

WKHSURFHVVRURSHUDWHVLQUHDOPRGH,ILWLVVHWWKHSURFHVVRURSHUDWHVLQSURWHFWHGPRGH

7DEOH

VKRZVWKHELWDOORFDWLRQVRIWKH&5UHJLVWHULQWKH

7RFKDQJHWRSURWHFWHGPRGHIURP'26LVHDV\

3URJUDP

029($;&5

25($;0DNHWKHOHDVWVLJQLILFDQWELW

029&5($;+HUHJRHV

%XWFKDQJLQJWRSURWHFWHGPRGHVKRXOGQRWEHDWWHPSWHGZLWKRXWSUHSDUDWLRQ7KH

PDFKLQHZLOOSURPSWO\FUDVKLI

3URJUDP

LVUXQEHIRUHWKHIROORZLQJVWHSVDUHWDNHQ

6WHS

,QSURWHFWHGPRGHDOOPHPRU\UHIHUHQFHVGHSHQGRQPHPRU\VHJPHQWGHVFULSWRUWDEOHVSDUWLFXODUO\

RQWKHJOREDOGHVFULSWRUWDEOH0HPRU\UHIHUHQFHVLQFOXGLQJWKRVHXVHGLQFRGHIHWFKLQJZLOOQRW

ZRUNXQWLOWKHVHWDEOHVDUHVHWXS7KHVHWDEOHVDUHGLVFXVVHGLQ

VHFWLRQ

7DEOH&55HJLVWHU

%LWV

/DEHO

)XOO1DPH



3*

3DJLQJ(QDEOH



&'

&DFKH'LVDEOH



1:

1R:ULWH7KURXJK



$0

$OLJQPHQW0DVN



:3

:ULWH3URWHFW



1(

1XPHULF(UURU(QDEOH



(7

([WHQVLRQ7\SHYV



76

7DVN6ZLWFKHG



(0

(PXODWH0DWK&KLS



03

0DWK&KLS3UHVHQW



3(

3URWHFWHG0RGH(QDEOH

ZRUNXQWLOWKHVHWDEOHVDUHVHWXS7KHVHWDEOHVDUHGLVFXVVHGLQ

VHFWLRQ



6WHS

,QSURWHFWHGPRGHWKHXVHRIDUDGLFDOO\GLIIHUHQWDGGUHVVLQJV\VWHPPHDQVWKDWLQVWUXFWLRQVZLOOEH

IHWFKHGIURPDGLIIHUHQW&6VHJPHQW&RGHPXVWEHVWRUHGLQWKHQHZ&6VHJPHQW

6WHS

,QSURWHFWHGPRGHHDFKHQWU\LQWKHLQWHUUXSWWDEOHLVDVSHFLDOO\IRUPDWWHGHLJKWE\WHHQWU\6RWKH

'26LQWHUUXSWWDEOHZKHUHHDFKHQWU\LVMXVWDIRXUE\WHDGGUHVVZLOOQRWZRUN%HIRUHJRLQJLQWR

SURWHFWHGPRGHDQHZLQWHUUXSWWDEOHPXVWEHFUHDWHG

7KLVLVZK\DOO[SURFHVVRUVERRWLQUHDOPRGH

1RWHWKDWVZLWFKLQJWRSURWHFWHGPRGHGRHVQRWVWDUWSDJLQJ$VFKHFNLQJ

7DEOH

VKRZVSDJLQJLVWXUQHG

RQXVLQJWKHWRSELWRI&5

3URWHFWHG0RGH6HJPHQWDWLRQ

$QDVVHPEOHUSURJUDPPHUZRUNLQJRQDQKDVDFFHVVWRZKDWHYHUPHPRU\WKHPDFKLQHKDV$OO

DGGUHVVHVDUHDFFHVVLEOH7RJHWDURXQGSUREOHPVFDXVHGE\WKHPLVILWRIWKHELWDGGUHVVHVDQGELW

DGGUHVVVUHJLVWHUVDGGUHVVLQJRQWKHXVHV.PHPRU\VHJPHQWV7KHORFDWLRQRIWKHVHPHPRU\

VHJPHQWVLVVSHFLILHGE\WKHVHJPHQWUHJLVWHUV2QFHDVHJPHQWUHJLVWHULVORDGHGRQHFDQUHDGWRRUZULWH

IURPWKHVSHFLILHGPHPRU\VHJPHQW6LQFHRQDQWKHSURJUDPPHUFDQZULWHWRDQ\VHJPHQWUHJLVWHUDW

ZLOODSURJUDPPHUFDQUHDGIURPRUZULWHWRDQ\ORFDWLRQLQPHPRU\H[FHSWIRUSK\VLFDOO\UHDGRQO\

PHPRU\7KLVPHDQVWKDWPHPRU\SURWHFWLRQRQDQLVLPSRVVLEOH

%HJLQQLQJZLWKWKHWKHVHJPHQWDWLRQPHFKDQLVPZDVFRPSOHWHO\UHGHVLJQHGIRUWKHSXUSRVHRI

WXUQLQJLWLQWRDPHPRU\SURWHFWLRQPHFKDQLVP0HPRU\VHJPHQWVRQDKDYHDFFHVVSHUPLVVLRQV

VRPHZKDWOLNH8QL[ILOHSHUPLVVLRQV7KH\DOVRKDYHDQDFFHVVSULYLOHJHOHYHO0HPRU\VHJPHQWVDUHQR

ORQJHUUHTXLUHGWREH.LQOHQJWKEXWFDQEHZKDWHYHUOHQJWKWKHRSHUDWLQJV\VWHPVSURJUDPPHUGHFLGHV

XSRQ0HPRU\VHJPHQWVDUHGHILQHGE\HLJKWE\WHGDWDVWUXFWXUHVFDOOHGDVHJPHQWGHVFULSWRUVRUVRPHWLPHV

MXVWDGHVFULSWRUV7KHVHGHVFULSWRUVDUHVWRUHGLQWDEOHVFDOOHGGHVFULSWRUWDEOHV'HVFULSWRUWDEOHVDUH

ORFDWHGLQPHPRU\MXVWOLNHWKHLQWHUUXSWWDEOH6HH

FKDSWHU



VHFWLRQ



6HJPHQWUHJLVWHUVDUHXVHGWRVWRUHSRLQWHUVLQWRWKHVHGHVFULSWRUWDEOHV7KHVHSRLQWHUVDUHFDOOHGVHOHFWRUV

7KH\VHOHFWVHJPHQWGHVFULSWRUVIURPWKHGHVFULSWRUWDEOHV6HH

)LJXUH



)LJXUH6HOHFWRU3LFNV6HJPHQW'HVFULSWRUIURPWKH'HVFULSWRU7DEOH

3URWHFWHG0RGH0HPRU\6HJPHQWV

7KHPRVWLPSRUWDQWFKDUDFWHULVWLFVRIDSURWHFWHGPRGHPHPRU\VHJPHQWDUHLWVEDVHDGGUHVVDQGLWVOLPLW

6HH

)LJXUH

IRUDQH[DPSOHRID0HJVHJPHQWVLWXDWHGDWWKHKDOIZD\SRLQWRID0HJPHPRU\

6XSSRVHWKDWWKH'6UHJLVWHUFRQWDLQVDVHOHFWRUVHOHFWLQJDGHVFULSWRUIRUWKLVPHPRU\VHJPHQW7KHQWKH

FRPPDQG

)LJXUH$3URWHFWHG0RGH0HPRU\6HJPHQW

029($;>'6+@

ZRXOGDFFHVVWKHIRXUE\WHVORFDWHGDWWKHDGGUHVVHV+WKURXJK+2QWKHRWKHUKDQGWKH

FRPPDQG

029($;>'6+@

ZRXOGFDXVHDJHQHUDOSURWHFWLRQIDXOWDKDUGZDUHH[FHSWLRQZKLFKJHQHUDWHVLQWHUUXSWQXPEHU6HH

FKDSWHU



VHFWLRQ

7KLVLVEHFDXVHWKHDOOIRXURIIVHWDGGUHVVHVUHIHUHQFHGE\WKHFRPPDQGH[FHHGWKH

OLPLW)RUH[DPSOH

+!)))))+

7KHFRPPDQGLVWU\LQJWRUHDGIURPDORFDWLRQ0HJIURPWKHEHJLQQLQJRIDVHJPHQWZKLFKLVRQO\

0HJLQOHQJWK%HFDXVHWKHKDUGZDUHHQIRUFHVWKHVHVHJPHQWERXQGDULHVWKHVHJPHQWDWLRQV\VWHPFDQEH

XVHGWRSURWHFWRQHWDVN VPHPRU\IURPDQRWKHU V,WZDVXVHGWRSURWHFWNHUQHOPHPRU\IURPXVHUSURFHVVHV

LQYHUVLRQVRI/LQX[EHIRUHYHUVLRQEXWLVQRORQJHUXVHGIRUPHPRU\SURWHFWLRQLQ/LQX[6HJPHQWV

LQ/LQX[QRZXVHDEDVHDGGUHVVRIDQGDOLPLWRI))))))))+LHDOO*LJ

$PRUHFRPSOHWHOLVWRIWKHFKDUDFWHULVWLFVRIDSURWHFWHGPRGHPHPRU\VHJPHQWLVDVIROORZV

 %DVH7KLVLVWKHDGGUHVVRIWKHILUVWE\WHRIWKHVHJPHQW,WLVWKHDGGUHVVFRUUHVSRQGLQJWRWKHRIIVHW

RI]HUR>@,QUHDOPRGHWKHEDVHDGGUHVVLVREWDLQHGE\MXVWDSSHQGLQJD]HURWRWKHIRXUKH[GLJLWV

VWRUHGLQWKHVHJPHQWUHJLVWHU

 /LPLW7KLVLVWKHODVWYDOLGRIIVHWDGGUHVV,WLVRQHOHVVWKDQWKHQXPEHURIE\WHVLQWKHVHJPHQW,WLV

WKDQNVWRWKLVSDUDPHWHUWKDWVHJPHQWVDUHQRWQHFHVVDULO\.DQ\PRUH7KHOLPLWQHHGHGWRVSHFLI\

D0HJVHJPHQWIRUH[DPSOHLV)))))+

D0HJVHJPHQWIRUH[DPSOHLV)))))+

 $FFHVV3HUPLVVLRQV3HUPLVVLRQVWRUHDGZULWHDQGH[HFXWHFDQEHVSHFLILHG

 $FFHVV3ULYLOHJH/HYHO7KLVSULYLOHJHOHYHOLVWKHOHDVWSULYLOHJHGYDOXHWKH&3/PD\KDYHLQRUGHU

IRUDFFHVVWREHJUDQWHG

 0LVFHOODQHRXV7KHUHDUHIRXURUILYHIXQFWLRQDOELWVLQWKHGHVFULSWRUXQXVHGE\LWHPVWKURXJK,Q

WKHFDVHRIH[HFXWDEOHVHJPHQWVRQHRIWKHVHELWVGHWHUPLQHVZKHWKHUWKHFRGHVWRUHGLQWKHVHJPHQW

ZLOOEHH[HFXWHGXVLQJDELWRUDELWGHIDXOWVHH

VHFWLRQ



,QRUGHUWRFDUU\RXWEDVHSOXVRIIVHWFRPSXWDWLRQVDQGRIIVHWYHUVXVOLPLWFRPSDULVRQVZLWKRXWWKHGHOD\

ZKLFKZRXOGEHFDXVHGE\DPHPRU\DFFHVVHDFKVHJPHQWUHJLVWHUKDVDVVRFLDWHGZLWKLWEDVHDQGOLPLW

UHJLVWHUVZKLFKDUHUHORDGHGHYHU\WLPHWKHVHJPHQWUHJLVWHULVFKDQJHGWRUHIHUHQFHDGLIIHUHQWVHJPHQW

)LJXUH

VKRZVWKHVHUHJLVWHUV$OWKRXJK

)LJXUH

VKRZVRQO\EDVHDGGUHVVDQGOLPLWUHJLVWHUVWKHUH

DUHDOVRUHJLVWHUVIRUDOOWKHRWKHUSHUPLVVLRQDQGSULYLOHJHELWVGHILQHGE\WKHVHJPHQWGHVFULSWRU

)LJXUH6HOHFWRU%DVHDQG/LPLW5HJLVWHUV

6SHFLDO0HPRU\6HJPHQWVWKH*'7DQGWKH,'7

6KRZQLQ

)LJXUH

DUHUHJLVWHUVIRUWKHWDVNVWDWHVHJPHQWWKHORFDODQGJOREDOGHVFULSWRUWDEOHVDQGWKH

LQWHUUUXSWGHVFULSWRUWDEOHWKH766/'76*'7DQG,'71RQHRIWKHVHDUHPHPRU\VHJPHQWVLQWKHVHQVH

WKDWWKH\FDQEHXVHGLQDQRUGLQDU\PHPRU\DFFHVVFRPPDQG)RUH[DPSOH

029($;>766+@

LVQRWYDOLGFRGH%XWWKH\DUHFKXQNVRIPHPRU\WKDWKDYHEDVHDGGUHVVHVDQGOLPLWV6LQFHWKH*'7DQG

WKH,'7DUHQRWDFFHVVHGYLDVHOHFWRUVWKH\DUHQRWFDOOHGPHPRU\VHJPHQWV7KH766DQGWKH/'7DUH

UHIHUUHGWRDVVSHFLDOPHPRU\VHJPHQWV

7KHWDVNVWDWHVHJPHQWLVXVHGLQWDVNVZLWFKHV7KHWDVNEHLQJH[LWHGVDYHVLWVUHJLVWHUVLQLWVWDVNVWDWH

VHJPHQW7KHEDVHDGGUHVVDQGOLPLWRIWKH766LVGHILQHGE\DVHJPHQWGHVFULSWRUMXVWOLNHRWKHUPHPRU\

VHJPHQWV

7KHORFDOGHVFULSWRUWDEOHVHJPHQW/'76LVXVHGWRVWRUHGHVFULSWRUVRIVHJPHQWVZKLFKDUHQRWVKDUHG

ZLWKDOORWKHUWDVNVRQWKHV\VWHP

ZLWKDOORWKHUWDVNVRQWKHV\VWHP

7KHJOREDOGHVFULSWRUWDEOHLVXVHGIRUVWRULQJGHVFULSWRUVRIPHPRU\VHJPHQWVZKLFKDUHDFFHVVHGE\DOO

WDVNVRQWKHV\VWHPDVZHOODVDOO/'76DQG766GHVFULSWRUV

$VZHFDQVHHIURP

)LJXUH

WKHUHFDQEHRQO\RQHJOREDODQGRQHORFDOGHVFULSWRUWDEOHLQHIIHFWDWDQ\

JLYHQWLPH:KHQDWDVNVZLWFKRFFXUVWKHORFDOGHVFULSWRUWDEOHLVFKDQJHGMXVWOLNHWKHSDJHWDEOHVDUH

FKDQJHG%XWWKHJOREDOGHVFULSWRUWDEOHVWD\VWKHVDPH

7KH,'7WKHLQWHUUXSWGHVFULSWRUWDEOHDQGLWVHQWULHVDUHGHVFULEHGLQ

FKDSWHU



7KHJOREDOGHVFULSWRUWDEOHDQGLQWHUUXSWGHVFULSWRUWDEOHDOVRKDYHEDVHDGGUHVVHVDQGOLPLWVDQGKHQFH

WKHUHDUHUHJLVWHUVIRUWKHP%XWWKHVHDGGUHVVHVDUHQHYHUFRGHGLQWRGHVFULSWRUVVRWKHUHLVQRSRLQWLQ

KDYLQJVHOHFWRUVIRUWKHP,QWHOGRHVQRWFRQVLGHUWKHJOREDOGHVFULSWRUWDEOHRUWKHLQWHUUXSWGHVFULSWRUWDEOH

WREHVHJPHQWVEHFDXVHWKH\DUHQRWDFFHVVHGXVLQJVHOHFWRUV

6HOHFWRUV

,QUHDOPRGHVHJPHQWUHJLVWHUVVXFKDV'6VSHFLI\VHJPHQWVE\KROGLQJWKHILUVWIRXUKH[GLJLWVRIWKHEDVH

DGGUHVVRIWKHVHJPHQW,QSURWHFWHGPRGHVHJPHQWUHJLVWHUVVSHFLI\VHJPHQWVE\KROGLQJSRLQWHUVWRWKHLU

GHVFULSWRUV(DFKGHVFULSWRUFRQVLVWVRIDFRPSOHWHGHILQLWLRQRIWKHVHJPHQW7KHSRLQWHUSRLQWVLQWRD

GHVFULSWRUWDEOH7KHWDEOHPD\HLWKHUEHWKHJOREDOGHVFULSWRUWDEOHRUWKHORFDOGHVFULSWRUWDEOH

$YHU\VLPSOHZD\WRLPSOHPHQWDSRLQWHUOLNHWKLVZRXOGEHWRXVHWKHRIIVHWIURPWKHEHJLQQLQJRIWKH

GHVFULSWRUWDEOH7KLVLVZKDWLVVKRZQLQ

)LJXUH

$OWKRXJKWKHYDOXHVKRZQLQWKHILJXUHZRXOG

ZRUNMXVWDVLOOXVWUDWHGLWLVQRWWKHFDVHWKDWWKHVHOHFWRULVVLPSO\DQRIIVHW

6XSSRVHWKDWDGHVFULSWRUZHZDQWWRSRLQWWRZHUHORFDWHGE\WHVIURPWKHEHJLQQLQJRIDGHVFULSWRUWDEOH

,QWKDWFDVHWKHRIIVHWZRXOGPDNHDYHU\JRRGSRLQWHUWRWKDWGHVFULSWRUDVVXPLQJZHNQRZZKLFKWDEOH

WKHGHVFULSWRULVORFDWHGLQ6LQFHHDFKGHVFULSWRURFFXSLHVHLJKWE\WHVRIVWRUDJHDOOVXFKRIIVHWVDUH

PXOWLSOHVRI+HQFHLQELQDU\WKHWKUHHOHDVWVLJQLILFDQWELWVRIHDFKRIIVHWDUH]HUR7KH[WDNHV

DGYDQWDJHRIWKLVIDFWDQGSXWVWKRVHWKUHHELWVRIWKHVHOHFWRUWRZRUNFDUU\LQJRWKHULQIRUPDWLRQ%LWVDQG

FDUU\DSULYLOHJHOHYHO%LWLVWKHWDEOHLQGLFDWRUELWZKLFKGHWHUPLQHVZKHWKHUWKHVHOHFWRULVDSRLQWHU

LQWRWKHJOREDOWDEOHRUWKHORFDOWDEOH ORFDO JOREDO7RUHFRYHUWKHRIIVHWIURPWKHVHOHFWRUWKH

ERWWRPWKUHHELWVPXVWEH]HURHGEDFNRXWDJDLQ

)LJXUH

LOOXVWUDWHVWKHH[DPSOHZKHUH'6FRQWDLQV

RU+$VDELWELQDU\QXPEHULWLV7KHSRLQWHULQWRWKHGHVFULSWRUWDEOHLVWKHWDEOHRIIVHWLQWKLV

FDVHRU+

)LJXUH6HOHFWRU(QFRGLQJ

7KHWKUHHOHDVWVLJQLILFDQWELWVDUH]HURHGRXW7RORFDWHWKHGHVFULSWRUIRUWKH'6VHJPHQWZHZRXOGJHWWKH

DGGUHVVRIWKHJOREDOGHVFULSWRUWDEOHIURPWKH*'7EDVHDGGUHVVUHJLVWHUDQGDGG+

7KHUHLVRQHVHOHFWRUZKLFKGRHVQRWXVHWKHIRUPDWMXVWGHVFULEHG

,WLVGHVLUDEOHWKDWRQHVHOHFWRUYDOXHEHDQXOOYDOXH7KDWPDNHVLWSRVVLEOHWRVKXWGRZQXQXVHGVHJPHQWV

$VHOHFWRUZKLFKSRLQWVWRRIIVHW]HURLQWKHJOREDOWDEOHLVE\GHILQLWLRQDQXOOVHOHFWRU6WRULQJDQXOO

VHOHFWRULQDVHJPHQWUHJLVWHUGLVDOORZVWKHXVHRIWKDWVHJPHQW$OODWWHPSWVWRDFFHVVDVHJPHQWPDUNHG

ZLWKDQXOOVHOHFWRUFDXVHDJHQHUDOSURWHFWLRQIDXOW7KLVLQFLGHQWDOO\PDNHVLWLPSRVVLEOHIRUDQ\VHOHFWRU

WRDFWXDOO\SRLQWWRWKHILUVWHQWU\LQWKHJOREDOWDEOH6RLWGRHVQ WPDWWHUZKDWWKLVHQWU\FRQWDLQV

WRDFWXDOO\SRLQWWRWKHILUVWHQWU\LQWKHJOREDOWDEOH6RLWGRHVQ WPDWWHUZKDWWKLVHQWU\FRQWDLQV

6HJPHQW2SHUDWLRQV

7KH*'7KDVWREHWKHUHIRUPHPRU\UHIHUHQFHVWRZRUNLQSURWHFWHGPRGHDQGWKH,'7KDVWREHWKHUHIRU

LQWHUUXSWVWRZRUN7KHORDGFRPPDQGVIRUWKHVHWDEOHVDUH

/*'7PHP

DQG

/,'7PHP

ZKHUHPHPSRLQWVWRVL[E\WHVRIPHPRU\FRQWDLQLQJDWZRE\WHOLPLWIROORZHGE\DIRXUE\WHEDVHDGGUHVV

7KHVHFRPPDQGVZRXOGRUGLQDULO\EHH[HFXWHGMXVWRQFHZKLOHWKHV\VWHPZDVERRWLQJLQUHDOPRGH

2WKHUVHJPHQWUHJLVWHUVDUHORDGHGXVLQJVHOHFWRUV

)LJXUH

VKRZVWKHFRPPDQGVIRUORDGLQJDQGVDYLQJ

VHJPHQWUHJLVWHUVDVZHOODVWKHFRPPDQGVIRUORDGLQJDQGVDYLQJWKH*'7DQG,'7EDVHDQGOLPLW

UHJLVWHUV:KHQVHJPHQWUHJLVWHUVDUHORDGHGDOOWKHRWKHUUHJLVWHUVDVVRFLDWHGZLWKWKHPDUHORDGHGDVZHOO

XQOHVVWKHQXOOVHOHFWRULVXVHGRUXQOHVVVRPHDFFHVVYLRODWLRQRFFXUV

)LJXUH6HJPHQW/RDGDQG6WRUH&RPPDQGV

7KHVHHLJKWE\WHVZRXOGLQFOXGHWKHEDVHDGGUHVVDQGVL]HRIWKH'6VHJPHQW7KHVHHLJKWE\WHVZRXOGDOVR

LQFOXGHDSULYLOHJHOHYHO6LQFHWKHSULYLOHJHFDUULHGLQ'6LVRQO\DWKHSULYLOHJHOHYHOLQWKHVHJPHQW

GHVFULSWRUZRXOGQHHGWREHDRUWKHSURFHVVRUZRXOGQDLOXVZLWKDQHUURU,QSURWHFWHGPRGHDFRPPDQG

VXFKDV

029'6$;

ZLOOFDXVHDSURWHFWLRQIDXOWZKHQHYHUWKHSULYLOHJHOHYHOFDUULHGE\WKHWZROHDVWVLJQLILFDQWELWVRIWKH

VHOHFWRULQ$;LVLQIHULRUWRWKHSULYLOHJHOHYHOZULWWHQLQWRWKHGHVFULSWRURIWKHVHJPHQW%HFDXVHWKHORFDO

GHVFULSWRUWDEOHLVLPSOHPHQWHGDVDVHJPHQWDFFHVVWRLWUHTXLUHVWKDWDVHOHFWRUIRULWEHORDGHGLQWRD

VHJPHQWUHJLVWHU6LQFHWKHORFDOGHVFULSWRUWDEOHLVDVSHFLDOVHJPHQWQRWMXVWDQ\VHJPHQWUHJLVWHUZLOOGR

7KHUHLVDVHJPHQWUHJLVWHUGHGLFDWHGWRWKHORFDOGHVFULSWRUWDEOHWKH/'7UHJLVWHU7RORDGWKH/'7

UHJLVWHUWKHIROORZLQJFRPPDQGLVXVHG

//'7UP

ZKHUHUPPXVWEHDWZRE\WHUHJLVWHURUPHPRU\ORFDWLRQFRQWDLQLQJDVHOHFWRUUHIHUHQFLQJDQHQWU\LQWKH

JOREDOGHVFULSWRUWDEOH7KLVHQWU\VKRXOGEHDGHVFULSWRUIRUDORFDOGHVFULSWRUWDEOH%HFDXVHWKHFRPPDQG

XVHVWKHJOREDOWDEOHLWRQO\ZRUNVLQSURWHFWHGPRGH)RUH[DPSOHLI$;FRQWDLQVDVHOHFWRUZKLFKSRLQWV

DWDGHVFULSWRUORFDWHGLQWKHJOREDOGHVFULSWRUWDEOHDQGWKLVGHVFULSWRUGHVFULEHVDORFDOWDEOHWKHQ

//'7$;

6XSSRVHZHKDYHDFRPSXWHUZLWK0HJRIPHPRU\DQGZHZDQWD0HJVHJPHQWVWDUWLQJDWWKH

EHJLQQLQJDWWKHKDOIZD\SRLQWLHDWWKHDGGUHVV0HJ

%DVH+6WDUWDW0HJ

/LPLW)))))+0HJ6HJPHQW

3HUPLVVLRQV5HDGDQG:ULWH

3ULYLOHJH/HYHO8VHU

7KLVLQIRUPDWLRQFDQEHFRGHGLQWRDQHLJKWE\WHGHVFULSWRU7KLVGHVFULSWRUFDQWKHQEHDGGHGWRD

GHVFULSWRUWDEOH)RUDXVHUSURJUDPWRDFFHVVWKLVVHJPHQWLWPXVWKDYHWKHLQGH[RUVHOHFWRURIWKLV

GHVFULSWRUVWRUHGLQDVHJPHQWUHJLVWHUVXFKDV'67KHRIIVHWDGGUHVVXVHGLQDFFHVVLQJWKHVHJPHQWPXVWEH

OHVVWKDQWKHOLPLWGHILQHGLQWKHGHVFULSWRU

'HVFULSWRU(QFRGLQJ

)LJXUH6HJPHQW'HVFULSWRU/D\RXW

7KHWZRPDLQLWHPVWKDWQHHGWREHHQFRGHGLQWRWKHPHPRU\VHJPHQWGHVFULSWRUDUHWKHEDVHDQGWKHOLPLW

6LQFHWKHVHDUHERWKIRXUE\WHQXPEHUVDQGWKHGHVFULSWRULVDQHLJKWE\WHVWUXFWXUHLWZRXOGDSSHDUWKDWWKH

VSDFHDYDLODEOHLVDOOXVHGXSE\MXVWWKHVHWZRLWHPV%\VTXHH]LQJRQWKHOLPLWHQFRGLQJKRZHYHUH[WUD

ELWVDUHIUHHGXS,QVWHDGRIDOORZLQJDOOHLJKWKH[GLJLWVRIWKHIRXUE\WHOLPLWYDOXHWREHFRQILJXUDEOHWKH

VHJPHQWGHVLJQHULVDOORZHGRQO\ILYHGLJLWVWRSOD\ZLWK7KLVVDYHVWKUHHKH[GLJLWVRUELWV7KHVHWKUHH

KH[GLJLWVDUHDOORZHGWREHHLWKHUVWDFNHGRQDWWKHIURQWRU)VWDFNHGRQDWWKHHQG7KHILUVWLVFDOOHGE\WH

JUDQXODULW\DQGWKHVHFRQGLVFDOOHGSDJHJUDQXODULW\6SHFLI\LQJZKLFKRIWKHVHWZRJUDQXODULWLHVLVXVHG

FRVWVRQHPRUHELW7KLVELWLVFDOOHGWKHJUDQXODULW\ELW$VDQH[DPSOHRIKRZWKLVGHVFULSWRUIRUPDWLV

XVHGOHWXVHQFRGHWKHVDPSOH0HJVHJPHQWMXVWGHVFULEHG7KHIRXUE\WHEDVHYDOXH+ZRXOG

EHVWRUHGLQELWVDQGELWVSOXVHLJKWELWV7KLVRGGIUDFWXUHLVDYHVWLJHRIWKHELW

DGGUHVVLQJXVHGRQWKH'LVSOD\LQJDOOHLJKWE\WHVDVDGLJLWKH[QXPEHUXVLQJ;IRU

XQGHWHUPLQHGGLJLWV\LHOGV

;;;;;;;;

7KHELWOLPLWYDOXHVDUHFRGHGLQWRELWVE\UHVWULFWLQJWKHQXPEHURIDOORZDEOHOLPLWYDOXHV7KHELWV

IURPDQGHQFRGHILYHKH[GLJLWV%LW*IRUJUDQXODULW\GHWHUPLQHVZKHWKHUWKHWKUHH

UHPDLQLQJKH[GLJLWVZLOOEHVDGGHGWRWKHWRSHQGRU)VDGGHGWRWKHERWWRP7KHYDOXH)))))+PD\

UHPDLQLQJKH[GLJLWVZLOOEHVDGGHGWRWKHWRSHQGRU)VDGGHGWRWKHERWWRP7KHYDOXH)))))+PD\

EHHQFRGHGXVLQJHLWKHUVFKHPH,IZHXVH* IRUE\WHJUDQXODULW\WKHQLQVHUWLQJWKHOLPLWELWV

)))))+JLYHVXV

;);;))))

,QWKH&6VHJPHQWVWKH'ELWLVH[WUHPHO\LPSRUWDQW,Q[FRGHWKHUHLVDFRGLQJGHIDXOWZKLFKPD\HLWKHU

EHIRUELWFRGHRUELWFRGH6HH

FKDSWHU



VHFWLRQ

IRUGHWDLOVRQKRZWKLVZRUNV,QSURWHFWHG

PRGHWKHGHIDXOWLVGHWHUPLQHGE\WKH'ELWRIWKH&6VHJPHQWGHVFULSWRU' PHDQVWKDWWKHGHIDXOWLV

ELWFRGH' PHDQVLWLV,QUHDOPRGHWKHGHIDXOWLVDOZD\VELWFRGH:LWK* ' DQGELWV

DQGDVZHJHW

);;))))

%LW3IRUSUHVHQWVKRXOGEHPDUNHG,IWKLVLVWREHDXVHUDFFHVVLEOHVHJPHQWWKHQWKH'3/ELWVPXVW

EH'3/VWDQGVIRUGHVFULSWRUSULYLOHJHOHYHO,IWKLVLVDGDWDVHJPHQWWKHQ( LHLWLVQRW

H[HFXWHDEOHDQG: LHLWLVZULWHDEOH0DNLQJWKHUHPDLQLQJWZRELWVDQG\LHOGV

))))))

7DVN,VRODWLRQYLD/RFDO'HVFULSWRU7DEOHV

$SURFHVVFDQRQO\DFFHVVPHPRU\VHJPHQWVWKDWDUHOLVWHGLQWZRWDEOHVLWVRZQWDEOHFDOOHGWKHORFDO

GHVFULSWRUWDEOHDQGDQRWKHUWDEOHFDOOHGWKHJOREDOGHVFULSWRUWDEOH7KHV\VWHPKDVRQO\RQHJOREDO

GHVFULSWRUWDEOH$OOSURFHVVHVKDYHDFFHVVWRWKHJOREDOWDEOHEXWORFDOWDEOHVQHHGQRWEHVKDUHG

&RQVHTXHQWO\RQHPHWKRGWKHRSHUDWLQJV\VWHPFRXOGXVHWRLVRODWHWDVNVIURPRQHDQRWKHUZRXOGEHWRKDQG

RXWGLIIHUHQWORFDOGHVFULSWRUWDEOHVWRGLIIHUHQWSURFHVVHV,IDVHJPHQWLVQRWOLVWHGLQHLWKHUWKHJOREDO

GHVFULSWRUWDEOHRUWKHSURFHVV VRZQORFDOGHVFULSWRUWDEOHWKHQWKHSURFHVVFDQ WJHWWRLW%HIRUHGLVFXVVLQJ

SURWHFWLRQIXUWKHUZHQHHGWRORRNDWVRPHRIWKHGHWDLOVRIGHVFULSWRUVVHOHFWRUVDQGWKHGHVFULSWRUWDEOHV

6HJPHQWDWLRQRQWKHZDVGHVLJQHGWRDOORZGLIIHUHQWWDVNVWRKDYHWKHLURZQPHPRU\VHJPHQWVWR

ZKLFKRWKHUWDVNVZRXOGQRWKDYHDFFHVV(DFKWDVNFDQKDYHLWVRZQORFDOGHVFULSWRUWDEOH'HVFULSWRUVRI

SULYDWHPHPRU\VHJPHQWVFDQEHVWRUHGLQWKHVHORFDOWDEOHV7KH[DUFKLWHFWXUHLPSOHPHQWVORFDO

GHVFULSWRUWDEOHVDVVHJPHQWVFRPSOHWHZLWKGHVFULSWRUVLQWKHJOREDOWDEOH,QWKHPHPRU\VKRZQLQ

)LJXUH



WKHUHDUHHLJKWPHPRU\VHJPHQWV(DFKRIWKHVHPHPRU\VHJPHQWVLVGHILQHGE\DGHVFULSWRUVLWXDWHG

LQDGHVFULSWRUWDEOH$OWKRXJKWKHJOREDOWDEOHLVOLNHDVHJPHQWLWLVQRWDVHJPHQW7KHUHLVQRGHVFULSWRU

IRULWDQ\ZKHUHLQPHPRU\DQGQRVHOHFWRUIRULWDQ\ZKHUHLQWKHSURFHVVRU

)LJXUH0HPRU\ZLWK3URWHFWHG6HJPHQWV

5HYLHZLQJEULHIO\WKHRSHUDWLQJV\VWHPSURWHFWVWKHPHPRU\EHORQJLQJWRRQHWDVNIURPDFFHVVE\DQRWKHU

WDVNE\XVLQJORFDOGHVFULSWRUWDEOHV$QHZWDVNZRXOGUHFHLYHDORFDOGHVFULSWRUWDEOHFRQWDLQLQJ

GHVFULSWRUVRIDOOWKHVHJPHQWVWRZKLFKWKDWWDVNLVDOORZHGDFFHVV6RORQJDVWKHRSHUDWLQJV\VWHPGLGQRW

SXWWKHVDPHGHVFULSWRULQWKHORFDOWDEOHEHORQJLQJWRVRPHRWKHUWDVNWKDWVHJPHQWZRXOGWKHQEHSULYDWH

$WDVNFDQRQO\DFFHVVDVHJPHQWLIDGHVFULSWRUIRUWKDWVHJPHQWLVLQWKHJOREDOWDEOHRULWVRZQORFDOWDEOH

7KLVV\VWHPRISURWHFWLRQLVLQFRPSOHWHKRZHYHU/RFNLQJWKHIURQWGRRUWR\RXUKRXVHGRHVQ WORFNWKH

KRXVHLIWKHEDFNGRRULVXQORFNHG6LQFHDOOWDVNVFDQDFFHVVWKHJOREDOWDEOHWKHUHPXVWEHVRPHWKLQJWR

SUHYHQWDURJXHWDVNIURPUHDGLQJWKHGHVFULSWRUVGHILQLQJWKHORFDOGHVFULSWRUWDEOHVEHORQJLQJWRRWKHU

WDVNV

&RQVLGHUWKLVFRGH

3URJUDP

029$;

$;LVDELWVHOHFWRU

%LWLV:H UHSRLQWLQJLQWRWKHJOREDOWDEOH

%LWVDQGDUH

7KDW VV\VWHPOHYHOSULYLOHJH

+$.//'7$;

$;LVSRLQWLQJDWVRPHGHVFULSWRU

,WFRXOGEHDORFDOWDEOHGHVFULSWRU

,IVRLW VSUREDEO\QRWRXURZQORFDOWDEOH

$QGLQWKDWFDVHZHKDYHMXVWERUURZHGVRPHRQH

HOVH VSULYDWHGHVFULSWRUWDEOHDQGZHFDQ

DFFHVVDQ\WKLQJOLVWHGLQWKHUH

DFFHVVDQ\WKLQJOLVWHGLQWKHUH

$''$;0D\EHQRW

*RWRWKHQH[WGHVFULSWRU

-03+$.7KHORFDOWDEOHVDUHLQKHUH

:H OOILQGWKHP

0HPRU\SURWHFWLRQE\LWVHOIGRHVQ WZRUN8VHUSURFHVVHVPXVWQRWEHDOORZHGWRH[HFXWHFRGHOLNHWKH

DERYHFRGH

6HWWLQJ8SWKH*OREDO'HVFULSWRU7DEOH

:KHQDQ[SURFHVVRULVWXUQHGRQRUUHVWDUWHGLWGRHVQRWFUHDWHDJOREDOGHVFULSWRUWDEOHDXWRPDWLFDOO\

+HQFHXQOHVVDPDQXIDFWXUHUSXWVRQHLQ520QRQHH[LVWVDWERRWWLPH6LQFHWKHSURFHVVRUFDQ WXVH

PHPRU\LQSURWHFWHGPRGHZLWKRXWDJOREDOWDEOHWKHSURFHVVRUPXVWERRWXSLQUHDOPRGH7KHSURFHVVRU

FDQVXEVHTXHQWO\EHVZLWFKHGLQWRSURWHFWHGPRGHEXWRQO\DIWHUWKHJOREDOWDEOHKDVEHHQVHWXS

7KHSURFHVVRUKDVEDVHDGGUHVVDQGOLPLWUHJLVWHUVIRUWKHJOREDOGHVFULSWRUWDEOH*'77KHVHUHJLVWHUVDUH

ORDGHGXVLQJWKHFRPPDQG

/*'7PHP

ZKHUHPHPSRLQWVWRVL[E\WHVRIPHPRU\FRQWDLQLQJDWZRE\WHOLPLWDQGDIRXUE\WHEDVHDGGUHVVIRUWKH

JOREDOWDEOH$OWKRXJKDUHJLVWHU

029

FRPPDQGPLJKWKDYHEHHQDPRUHFRQYHQLHQWZD\RIGRLQJWKLVWKHUH

DUHQRVL[E\WHUHJLVWHUVDYDLODEOH

$VDQH[DPSOHRIKRZZHPLJKWXVHWKH

/*'7

FRPPDQGVXSSRVHWKDWWHQGHVFULSWRUVWKDWZHZDQWWRXVHDV

RXUJOREDOWDEOHKDYHEHHQVWRUHGVWDUWLQJDWDGGUHVV+2XUJOREDOWDEOHZLOOWKHUHIRUHEHHLJKW\E\WHV

ORQJDQGVWDUWDW+7KHOLPLWLVRQHOHVVWKDQHLJKW\RU)+,QRUGHUWRXVHWKH/*'7FRPPDQGZH

QHHGWRVWRUHWKHVHYDOXHVLQPHPRU\VRPHZKHUH6XSSRVHZHVHWXSDVFUDWFKPHPRU\DUHDDW+

DQGSXWRXU*'7YDOXHVWKHUH$IWHUWKLVFRGH

3URJUDP

029$;+6HWXSDVHJPHQWIRUWKHVFUDWFKDUHD

029'6$;

029$;)+*'7 VOLPLWLVDE\WHYDOXH

029>'6@$;6WRUHLQWRWKHILUVWE\WHVRI

VFUDWFK

029($;+*'7 VEDVHDGGUHVVLVDE\WHYDOXH

029>'6@($;6WRUHWKLVE\WHDGGUHVV

E\WHVLQWRWKHVFUDWFK

'RQ WRYHUZULWHWKHILUVWWZRE\WHV

/*'7>'6@

7KLVORDGVWKHERWKWKH*'7EDVHDGGUHVVUHJLVWHU

DQGWKH*'7OLPLWUHJLVWHU

LHORDGDOOE\WHV

KDVH[HFXWHGWKH*'7EDVHVDGGUHVVDQGOLPLWUHJLVWHUVZLOOEHORDGHG7KHJOREDOWDEOHKDVQRWEHHQXVHG

IRUDQ\WKLQJ\HW,QIDFWZHFRXOGHYHQUXQWKLVFRGHILUVWDQGWKHQVWRUHWKRVHHLJKW\E\WHVQH[W7KHJOREDO

WDEOHZLOOQRWJRLQWRRSHUDWLRQXQWLOWKHSURFHVVRULVVZLWFKHGLQWRSURWHFWHGPRGH

&ORVLQJ

7KHVXUIDFHKDVEDUHO\EHHQVFUDWFKHG%XWWKHZD\IRUZDUGLVRSHQ