&2//(&7,6 7KH VROXWLRQ WR D UHDO SUREOHP :LWK RYHU \HDUV RI ILHOG SURYHQ SURGXFWLRQ WKH &2//(&7,6 WHFKQRORJ\ KDV EHHQ ZHOO DFFHSWHG DQG SURGXFWLRQ V\VWHPV ZRUOGZLGH KDYH UHFRJQL]HG WKH EHQHILWV RI WKH &2//(&7,6 7RGD\ &2//(&7,6 LV XWLOL]HG WR FROOHFW RYHU ERDUV ZHHNO\ SURGXFLQJ PRUH WKDQ PLOOLRQ GRVHV DQQXDOO\
7KH &RQFHSW 7KH LGHD ZDV WR GHYHORS D V\VWHP ZKLFK ZRXOG PD[LPL]H WKH HIILFLHQF\ RI ODERU ZKLOH UHGXFLQJ SURGXFWLRQ FRVW 7KH UHVXOW LV &2//(&7,6 DQ DXWRPDWHG ERDU FROOHFWLRQ V\VWHP WKDW LV D IXQFWLRQDO DQG SUDFWLFDO DSSURDFK WR ERDU VHPHQ FROOHFWLRQ 7KH &2//(&7,6 LV GHVLJQHG WR DOORZ D VLQJOH WHFKQLFLDQ WR ³PDQDJH´ PXOWLSOH FROOHFWLRQ SHQV VLPXOWDQHRXVO\ ZKLOH HOLPLQDWLQJ WKH QHHG IRU WHFKQLFLDQV WR FROOHFW ERDUV
0DLQ &RPSRQHQWV $UWLILFLDO 9DJLQD $9 ³7KH KHDUW RI &2//(&7,6 ´ 7KH KHDUW RI WKH &2//(&7,6 LV DQ DUWLILFLDO YDJLQD $9 7KH KHOLFRLGDOO\ VKDSH RI WKH $9 GXSOLFDWHV WKH QDWXUDO VKDSH RI WKH VRZ¶V FHUYL[ DQG PD[LPL]HV ERDU VWLPXODWLRQ GXULQJ FROOHFWLRQ 7KH GHVLJQ RI WKH $9 SURWHFWV VHPHQ DJDLQVW FRQWDPLQDWLRQ DQG PD[LPL]HV K\JLHQH GXULQJ FROOHFWLRQ E\ XWLOL]LQJ D GLVSRVDEOH FROOHFWLRQ V\VWHP 7KH SUHVVXUH RI WKH $9 LV FRQWUROOHG E\ DLU SUHVVXUH WKURXJK WKH PDVWHU FRQWURO ER[ 'LVSRVDEOH 6HPHQ &ROOHFWLRQ 6HW ± 6DQLWDWLRQ 6DIHW\ &ROOHFWLRQ 6OHHYH ± 'XULQJ FROOHFWLRQ WKH ERDU¶V SHQLV LV VXUURXQGHG LQ D GLVSRVDEOH SODVWLF VOHHYH ZLWKLQ WKH $9 7KH GLVSRVDEOH VOHHYH VHUYHV D GXDO SXUSRVH )LUVW LW SUHYHQWV WKH ERDU IURP FRPLQJ LQWR GLUHFW FRQWDFW ZLWK WKH $9 6HFRQG WKH GLVSRVDEOH VOHHYH VKLHOGV WKH VHPHQ EHLQJ FROOHFWHG DJDLQVW FRQWDPLQDWLRQ )LOWUDWLRQ &RQH ± $ GLVSRVDEOH ILOWUDWLRQ FRQH DWWDFKHV WR WKH ERWWRP RI WKH $9 GXULQJ FROOHFWLRQ FUHDWLQJ D VHDOHG FRQWDLQPHQW YHVVHO IRU VHPHQ EHLQJ FROOHFWHG $V VHPHQ LV ILOWHUHG LQWR WKH LQWHJUDWHG FROOHFWLRQ EDJ LW LV SUHYHQWHG IURP FRPLQJ LQWR GLUHFW FRQWDFW ZLWK WKH FROOHFWLRQ HQYLURQPHQW DQG DLU FRQWDPLQDWLRQ LV JUHDWO\ UHGXFHG &ROOHFWLRQ %DJ ± $IWHU EHLQJ ILOWHUHG WKH VHPHQ LV FROOHFWHG LQ WKH GLVSRVDEOH FROOHFWLRQ EDJ ZKLFK LV DWWDFKHG WR WKH ILOWUDWLRQ FRQH E\ D SHUIRUDWHG WHDU VWULS 2QFH FROOHFWLRQ LV FRPSOHWH WKH WHFKQLFLDQ VLPSO\ WHDUV WKH EDJ DW WKH SHUIRUDWLRQ DQG VHQGV WKH VHPHQ WR WKH ODE IRU SURFHVVLQJ
6WDLQOHVV &ROOHFWLRQ 'XPP\ ± ³7KH KDUGZDUH VXSSRUWLQJ &2//(&7,6 ´ 0DGH RI ORQJ ODVWLQJ VWDLQOHVV VWHHO DQG FRDWHG ZLWK GXUDEOH SODVWLF WKH FROOHFWLRQ GXPP\ KDV EHHQ VSHFLILFDOO\ GHVLJQHG WR PD[LPL]H WKH HIIHFWLYHQHVV RI WKH $9 RQ WKH &2//(&7,6 7KH $9 DQG FROOHFWLRQ YHVVHO ³ULGH´ RQ DQ DGMXVWDEOH WUROOH\ ORFDWHG XQGHUQHDWK WKH FROOHFWLRQ GXPP\ 7KLV FULWLFDO GHVLJQ
FRPSRQHQW DOORZV WKH ERDU WR FRQWLQXH WR PRYH DQG WKUXVW ZKLOH VWLOO EHLQJ FRQQHFWHG WR WKH &2//(&7,6 ZLWKRXW GLVFRQQHFWLQJ RU GDPDJLQJ WKH ERDU¶V SHQLV 'HOLYHUHG ZLWK ´ VWDLQOHVV VWHHO PRXQWLQJ SODWHV LW FDQ EH IL[HG RQ WRS RI HLWKHU VODWHV RU D FRQFUHWH SDG
'LVSRVDEOH OLQHU IRU YDJLQD 'LVSRVDEOH SODVWLF FRQH ZLWK VHPHQ EDJ DQG ILOWHU FRQQHFWHG
&RQQHFWRU IRU DLU ZLUH IRU YDJLQD
0DVWHU &RQWURO %R[ ± ³7KH EUDLQV EHKLQG &2//(&7,6 ´ 7KH PDVWHU FRQWURO ER[ IRU WKH &2//(&7,6 UHJXODWHV WKH SUHVVXUH DSSOLHG WKURXJK WKH $9 GXULQJ FROOHFWLRQ +RXVHG LQ D VHDOHG KHDY\ GXW\ SODVWLF HOHFWULFDO ER[ 7KH PDVWHU FRQWURO ER[ KDV PDLQ IXQFWLRQV ± 9HQWXUL )XQFWLRQ ± 'HVLJQHG IRU ERDUV ZLWK D ³WKLFNHU SHQLV VKDIW´ WKH YHQWXUH IXQFWLRQ DSSOLHV D YDFXXP WR RSHQ WKH $9 ZLGHU WR DFFHSW WKH ERDU¶V SHQLV ± &RQWLQXRXV 3UHVVXUH )XQFWLRQ ± 7KLV IXQFWLRQ DSSOLHV FRQWLQXRXV SUHVVXUH GXULQJ FROOHFWLRQ WR LQVXUH WKH ERDU LV SURSHUO\ VWLPXODWHG ± 3XOVDWLQJ &\FOH )XQFWLRQ± )RU ODUJHU ERDUV WKH PDVWHU FRQWURO RIIHUV D ³SXOVDWLQJ F\FOH´ ZKLFK DVVLVWV LQ VWLPXODWLQJ ERDUV GXULQJ FROOHFWLRQ
&2//(&7,6 ,09 7(&+12/2*,(6
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
&2//(&7,6 6HPHQ TXDQWLW\ DQG TXDOLW\ XQFKDQJHG 7KH &2//(&7,6 LPSURYHV VHPHQ WHFKQLFLDQ HIILFLHQF\ VDIHW\ DQG FRPIRUW ZLWKRXW DQ\ LPSDFW RQ WKH TXDOLW\ RU TXDQWLW\ RI VHPHQ FROOHFWHG
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
*HUP FRXQW
5HVXOWV RI WULDOV FRQGXFWHG E\ 1%* $UWLILFLDO ,QVHPLQDWLRQ 6WDWLRQ /DQGVKXW²3RFNLQJ H* %DYDULD *HUPDQ\ LQ FRQMXQFWLRQ ZLWK /08 8QLYHUVLW\ IRU +\JHQH DQG 7HFKQRORJ\ RI 0LON 0XQLFK *HUPDQ\
6HPHQ 4XDQWLW\ 'XULQJ WKH ILUVW WR ZHHNV PRVW RI WKH VWXGV VZLWFKLQJ WR WKH &2//(&7,6 ZLOO QRWLFH D GHFUHDVH LQ WKH QXPEHU RI GRVHV SURGXFHG SHU HMDFXODWH 7KLV LV GXH WR ERWK WKH ERDUV DQG WKH WHFKQLFLDQV DGMXVWLQJ WR WKH QHZ WHFKQRORJ\ $IWHU WKH LQLWLDO WUDQVLWLRQ SHULRG SURGXFWLRQ UHWXUQV WR QRUPDO
7DEOH GLVSOD\V D VXPPDU\ RI SURGXFWLRQ GDWD IRU HMDFXODWHV FROOHFWHG PDQXDOO\ DQG XV LQJ &2//(&7,6 7DEOH LV VKRZLQJ WKH RYHUDOO ODERU HIILFLHQF\ FRPSDULVRQ EHWZHHQ PDQXDO FROOHFWLRQ DQG FROOHFWLRQ XVLQJ WKH &2//(&7,6 7DEOH 6XPPDU\ RI SURGXFWLRQ IRU HMDFXODWHV FROOHFWHG PDQXDOO\ DQG XVLQJ &2//(&7,6 6285&( 6HUJLR %DUUDEHV $QHDV ,&%63
0$18$/
&2//(&7,6
$YHUDJH 5HVW GD\V
'RVHV FROOHFWLRQ
&RQFHQWUDWLRQ PLOOLRQ RI 63= SHU PO
9ROXPH FROOHFWLRQ PO
7RWDO &HOO FROOHFWLRQ ELOOLRQ RI 63=
1XPEHU RI HMDFXODWHV
7DEOH 2YHUDOO ODERU HIILFLHQF\ FRPSDULVRQ 6RXUFH 6HUJLR %DUUDEHV $QHDV²,&%63
0$18$/
&2//(&7,6
1XPEHU RI FROOHFWLRQ GD\V
$YHUDJH GDLO\ FROOHFWLRQ WLPH KRXUV
$YHUDJH QXPEHU RI FROOHFWRUV SHU GD\
$YHUDJH GDLO\ QXPEHU RI FROOHFWLRQ
$YHUDJH KRXUO\ QXPEHU RI FROOHFWLRQ SHU FROOHFWRU
$YHUDJH WLPH IRU ILUVW FROOHFWLRQ
$0
$0
$YHUDJH WLPH IRU ODVW FROOHFWLRQ
30
30
7RWDO FROOHFWLRQ KRXUV SHU \HDU
D
E
1XPEHU RI FROOHFWLRQV
D E
'LIIHUHQW VXSHUVFUSWV ZLWKLQ URZV LQGLFDWH VLJQLILFDQW GLIIHUHQFH 3
*UHJ /HERZD²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
*' $IWHU D \HDU RI XVLQJ WKH &2//(&7,6 KDV FROOHFWLRQ HIILFLHQF\ LPSURYHG"
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
5RQ 'UDSHDX ² $ VRXQG ILQDQFLDO GHFLVLRQ &,34 ,QF &HQWUH G¶LQVpPLQDWLRQ SRUFLQH GX 4XpEHF &,34 LQF ZDV FUHDWHG LQ E\ WKH 'HSDUWPHQW RI $JULFXOWXUH RI 4XHEHF WR SURPRWH DQG SURYLGH WKH $, WHFKQLTXH WR WKH 4XHEHF VZLQH LQGXVWU\ ,Q WKH RUJDQL]DWLRQ EHFDPH D FURZQ FRUSRUDWLRQ UDQ E\ D ERDUG RI GLUHFWRUV WKDW LV PDLQO\ SLJ SURGXFHUV DQG $, XVHUV 7RGD\ &,34 ,QF RSHUDWHV ILYH $, VWXGV ZLWK D ERDU FDSDFLW\ RI DQG VHOOV RYHU PLOOLRQ GRVHV SHU \HDU 5RQ 'UDSHDX *HQHUDO 0DQDJHU IRU WKH &,34 KDV EHHQ WKH OHDGLQJ GHFLVLRQ PDNHU LQ WKH LPSOHPHQWDWLRQ RI WKH &2//(&7,6 WHFKQRORJ\
*HQHV 'LIIXVLRQ *' :KHQ GLG \RX GHFLGH WR LQYHVW LQ WKH WHFKQRORJ\" 5RQ 'UDSHDX 5' ,Q ZH YLVLWHG *HQHV 'LIIXVLRQ¶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
*' :KDW DUH WKH PDLQ UHDVRQV WR LQYHVW LQ WKH &2//(&7,6
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
*' ,V WKH &2//(&7,6 PRUH HIILFLHQW WKDQ WKH WHFKQLTXH \RX ZHUH
XVLQJ EHIRUH" 5' :H KDYH LQVWDOOHG QLQH &2//(&7,6 LQ RXU RUJDQL]DWLRQ DERXW SHU ERDUV $ ZHOO WUDLQHG DQG GHGLFDWHG VWDII FDQ DFKLHYH HLJKW FROOHFWLRQV SHU KRXU XVLQJ WKH &2//(&7,6 WHFKQRORJ\ FRPSDUHG WR IRXU FROOHFWLRQV SHU KRXU ZLWK WKH WUDGLWLRQDO PHWKRG
:H KDYH UHRUJDQL]HG WKH ZRUNLQJ VFKHGXOH IRU RXU SHUPDQHQW VWDII :H DUH DOVR XVLQJ OHVV SDUW WLPH ZRUNHUV LQ WKH RUJDQL]DWLRQ 2YHUDOO ZH FRQVLGHU WKDW ZH QHHG OHVV ZRUNLQJ KRXUV LQ WKH VWXGV WR DFKLHYH WKH VDPH QXPEHUV RI FROOHFWLRQV
*' 'LG \RX QRWLFH DQ\ FKDQJHV LQ VHPHQ RXWSXW RU TXDOLW\"
5' 'XULQJ WKH WUDLQLQJ SURFHVV ZH REVHUYHG D OLWWOH GHWHULRUDWLRQ IRU FHUWDLQ ERDUV $V VRRQ DV WKH SURFHVV LV ZHOO FRQWUROOHG E\ WKH VWDII DQG ERDUV EHFRPH IDPLOLDU HYHU\WKLQJ FRPHV EDFN WR QRUPDO $IWHU D IXOO \HDU RI RSHUDWLRQ LQ DOO RI RXU VWXGV ZH ZLOO VHH LI WKHUH LV DQ LPSDFW :H VXVSHFW WKDW ZH ZLOO SUREDEO\ VHH DQ LQFUHDVH LQ WKH VSHUP RXWSXW D OLWWOH ELW EHFDXVH LW¶V WKH ERDU KLPVHOI ZKR FRQWUROV WKH HMDFXODWLRQ SURFHVV 7KH EDFWHULDO FRXQWV WKDW ZH UXQ HYHU\ ZHHN DUH VWLOO FRPSDUDEOH WR ZKDW ZH KDG EHIRUH LQWURGXFLQJ WKH &2//(&7,6 WHFKQRORJ\ :H FRQVLGHU K\JLHQH LV EHWWHU EHFDXVH WKH VHPHQ LV OHVV H[SRVHG WR WKH VXUURXQGHG DLU ZLWK WKH &2//(&7,6
*' :KDW LV WKH UHWXUQ RQ LQYHVWPHQW SHULRG" 5' 7KH UHWXUQ RQ WKH LQYHVWPHQW LV LPSRUWDQW 'HSHQGLQJ RQ ZKDW NLQG RI LQYHVWPHQW WKDW LV PDGH IRU EXLOGLQJ WUDQVIRUPDWLRQV WKH WRWDO UHWXUQ FDQ EH HVWLPDWHG EHWZHHQ DQG \HDUV
*' +RZ ZDV WKH LPSOHPHQWDWLRQ SURFHVV" 5' 7KDW WHFKQRORJ\ FDQ PDNH VWDII XQFRPIRUWDEOH DW WKH EHJLQQLQJ EHFDXVH WKH\ PLJKW DQWLFLSDWH VRPH MRE ORVV DV VRRQ DV WKH\ VHH WKDW LW DIIHFWV PDLQO\ SDUW WLPH ZRUNHUV WKH WHFKQRORJ\ LV ZHOO DFFHSWHG 2Q WKH RWKHU KDQG WKH HPSOR\HHV VHH LW DV DQ LPSURYHPHQW LQ WHUPV RI ZRUNLQJ FRQGLWLRQV DV WKHUH LV OHVV ULVN ZKHQ XVLQJ WKDW WHFKQRORJ\ *HQHV 'LIIXVLRQ¶V WHDP ZDV YHU\ HIILFLHQW WR ZRUN ZLWK WKH\ KDYH VSHFLDOLVWV WKDW FDQ KHOS LQ EXLOGLQJV GHVLJQ VWDII WUDLQLQJ WHFKQLFDO VXSSRUW HWF 8VLQJ D QHZ WHFKQRORJ\ LV RQH WKLQJ EXW WKH HIILFLHQF\ RI LW FDQ EH FRPSURPLVHG LI \RX GRQ¶W UHO\ RQ WKH SHRSOH WKDW FDQ KHOS \RX VROYH SUREOHPV WKDW DOZD\V FRPH ZLWK LPSOHPHQWDWLRQ RI QHZ ZD\V RI GRLQJ WKLQJV )RU XV WKH SHRSOH DW *HQHV 'LIIXVLRQ DUH DOZD\V WKHUH WR KHOS WKH\ FDQ SURYLGH XV ZLWK D JRRG VHUYLFH JRRG SURGXFWV DQG JRRG H[SHUWLVH 6R IDU ZH KDYH QRW H[SHULHQFHG D ORW RI SUREOHPV ZLWK WKH PDFKLQHV \HW WKH\ DUH QRW WRR FRPSOLFDWHG $JDLQ ZH ZLOO KDYH D PRUH SUHFLVH LGHD RQ WKHLU UHOLDELOLW\ ZKHQ ZH ZLOO KDYH D IXOO \HDU RI RSHUDWLRQ LQ DOO RI RXU XQLWV
*' 'LG WKH V\VWHP GHOLYHU DV SURPLVHG" 5' <HV ZH DUH DFKLHYLQJ RXU JRDOV LQ WHUPV RI FRVW RI ODERU SHU FROOHFWLRQ DQG ZH GLG LW IDVWHU WKDQ H[SHFWHG DW WKH EHJLQQLQJ 7KH &2//(&7,6 WHFKQRORJ\ KDV DQG ZLOO KDYH D SRVLWLYH LPSDFW RQ RXU RSHUDWLRQV IRU PDQ\ \HDUV ,W ZLOO KHOS XV LQ EHLQJ PRUH HIILFLHQW LQ D PRUH VHFXUH ZD\ DQG ZLWK EHWWHU FRQGLWLRQV IRU RXU ZRUNHUV , ZLOO UHFRPPHQG WKLV WHFKQRORJ\ WR DQ\RQH LQYROYHG LQ WKH VHPHQ FROOHFWLRQ RQ D UHJXODU EDVLV
,W VDYHV PRQH\ DQG WLPH DQG DOVR LPSURYHV DOO WKH HIILFLHQF\ RI WKH RUJDQL]DWLRQ
.HQ 0DWKLDV ² :KHQ VDIHW\ PDWWHUV
0RQVDQWR &KRLFH *HQHWLFV RSHUDWHV DPRQJ RWKHUV RQH QXFOHXV ERDU VWXG LQ &DQDGD 7KLV VWXG VXSSOLHV VHPHQ WR WKHLU LQWHUQDO DQG H[WHUQDO QXFOHXV IDUPV $IWHU YLVLWLQJ VHYHUDO IDFLOLWLHV DOUHDG\ HTXLSSHG ZLWK WKH &2//(&7,6 WHFKQRORJ\ .HQ 0DWKLDV 6DIHW\ 5HSURGXFWLRQ 0DQDJHU IRU 0RQVDQWR &KRLFH *HQHWLFV GHFLGHG WR LQVWDOO WKH &2//(&7,6 DW WKLV ORFDWLRQ LQ HDUO\
*HQHV 'LIIXVLRQ *' :KHQ GLG \RX GHFLGH WR LQYHVW LQ WKH &2//(&7,6
WHFKQRORJ\" .HQ 0DWKLDV .0 :H GHFLGHG WR LQYHVW LQ WKH &2//(&7,6 GXULQJ WKH IDOO RI DQG DFWXDOO\ LQVWDOOHG WKH HTXLSPHQW LQ WKH VSULQJ RI
*' :K\ GLG \RX GHFLGH WR LQYHVW LQ WKH &2//(&7,6 WHFKQRORJ\"
.0 6DIHW\ ZDV WKH QXPEHU RQH UHDVRQ ZH GHFLGHG WR JR ZLWK WKH &2//(&7,6 :H LPSOHPHQWHG DQ (UJRQRPLF &ROOHFWLRQ 7HFKQLTXH DERXW \HDUV DJR DQG ZKHQ , VDZ WKH &2//(&7,6 , NQHZ ULJKW DZD\ WKLV ZRXOG EH WKH QH[W VWHS ZH QHHGHG WR WDNH WR EH WRWDOO\ KDQGV IUHH
*' :KDW ZDV \RXU GHFLVLRQ PDNLQJ SURFHVV"
.0 6DIHW\ LV D FRUH YDOXH DW 0RQVDQWR :KHQ ZH VHH VRPHWKLQJ WKDW FDQ FUHDWH D VDIHU HQYLURQPHQW IRU RXU HPSOR\HHV RXU PDQDJHPHQW WHDP LV IDVW WR JHW RQERDUG DQG WDNH D ORRN DW LW
*' :KDW ZHUH WKH NH\ DUJXPHQWV LQ PDNLQJ WKH GHFLVLRQ"
.0 2EYLRXVO\ ZKHQ \RX LQYHVW LQ WHFKQRORJ\ OLNH WKLV WKHUH LV DOZD\V D GLVFXVVLRQ DERXW WKH UHWXUQ $V PHQWLRQHG HDUOLHU RXU SULPDU\ UHDVRQ IRU SXUVXLQJ WKH &2//(&7,6 ZDV WR LPSURYH RXU VDIHW\ SURJUDP DQG ZH IHOW LI WKLV FDQ NHHS XV IURP KDYLQJ DQ HUJRQRPLF LQMXU\ WKHQ LW KDV SDLG IRU LWVHOI
*' 'LG \RX KDYH WR PDNH DQ\ PRGLILFDWLRQV WR \RXU EXLOGLQJ"
.0 :H KDG WR UHGHVLJQ RXU FROOHFWLRQ SHQV WR DFFRPPRGDWH WKH &2//(&7,6 $W ILUVW ZH ZHUH D OLWWOH UHOXFWDQW EHFDXVH ZH GLGQ¶W NQRZ KRZ WKH ERDUV ZHUH JRLQJ WR UHDFW WR QRW RQO\ FKDQJLQJ WKH FROOHFWLRQ GXPPLHV EXW DOVR UHFRQILJXULQJ WKH FROOHFWLRQ SHQ :KHQ LW ZDV DOO VDLG DQG GRQH WKH ERDUV GLGQ¶W VHHP WR PLQG DQG WKH VOLGLQJ GRRUV WKDW ZHUH LQVWDOOHG ZHUH D JUHDW ERQXV
*' 'R \RX EHOLHYH D SLW GHVLJQ ZRXOG KDYH EHHQ EHWWHU"
.0 :H ZHUH XQDEOH WR XWLOL]H D SLW EXW ZH ZHUH DEOH WR XWLOL]H WKH VOLGLQJ GRRUV WKDW \RX VHH ZLWK D SLW GHVLJQ :H GLGQ¶W UHFRJQL]H LW DW ILUVW EXW WKLV DGGHG DQ DGGLWLRQDO VDIHW\ IHDWXUH WR RXU SURJUDP 1RW RQO\ KDYH ZH UHGXFHG WKH QXPEHU RI ERDUV WKDW DUH FROOHFWHG E\ KDQG ZH KDYH UHGXFHG WKH HPSOR\HH WR ERDU FRQWDFW DQG WKLV UHGXFHV WKH ULVN RI WKH ERDU IDOOLQJ RII WKH GXPP\ DQG ODQGLQJ RQ WKH HPSOR\HH GXULQJ WKH FROOHFWLRQ SURFHVV
*' +RZ GLG \RX LPSOHPHQW WKH WUDQVLWLRQ IURP PDQXDO FROOHFWLRQ WR WKH &2//(&7,6 "
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
*' +DYH \RX VHHQ DQ LQFUHDVH LQ QXPEHU RI FROOHFWLRQV SHU KRXU SHU HPSOR\HH"
.0 (IILFLHQF\ LV D QLFH ERQXV EXW ZDV QRW D IRFXV IRU XV :H DUH VWLOO LQ WKH SURFHVV RI WUDLQLQJ VRPH RI RXU QHZHU HPSOR\HHV DQG ZH RQO\ KDYH WKH &2//(&7,6 VHW XS LQ RQH RI WKH WZR EDUQV +RZHYHU ZH KDYH QRW GHFUHDVHG WKH QXPEHU RI ERDUV FROOHFWHG SHU SHUVRQ SHU KRXU DQG ZKLOH WKH ERDU LV RQ WKH &2//(&7,6 LW DOORZV WKH HPSOR\HHV WR WUDLQ DQRWKHU ERDU RU FOHDQ D SHQ )RU QRZ ZH KDYH QRW FKDQJHG RXU RUJDQL]DWLRQ EXW ZH NQRZ ZH KDYH FUHDWHG DQ HQYLURQPHQW WKDW LV VDIHU IRU RXU HPSOR\HHV
*' +DYH \RX QRWLFHG DQ\ GLIIHUHQFH LQ VHPHQ TXDOLW\ DIWHU \RX KDG LQVWDOOHG WKH &2//(&7,6 "
.0 :H KDYH QRW VHHQ D FKDQJH LQ VHPHQ TXDOLW\ +RZHYHU LW GRHV DSSHDU WKH HMDFXODWHV DUH PRUH FRQVLVWHQW ZLWK WKH GRVHV \LHOGHG IURP RQH ZHHN WR WKH QH[W :H NQRZ ERDUV ZLOO SHUIRUP EHWWHU IRU FHUWDLQ HPSOR\HHV ZKHQ D KDQG FROOHFWLRQ PHWKRG LV XVHG DQG ZLWK WKH &2//(&7,6 WKH SUHVVXUH LV DOZD\V WKH VDPH DQG WKH ERDUV EHFRPH DFFXVWRPHG WR WKLV
*' 'R \RX EHOLHYH WKHUH LV DQ LPSURYHPHQW LQ WKH K\JLHQH RI WKH FROOHFWLRQ SURFHVV" .0 :H KDYH DOZD\V VWUHVVHG SURSHU K\JLHQH DQG FRQGXFW URXWLQH VHPHQ TXDOLW\ HYDOXDWLRQV WKURXJK D WKLUG SDUW\ DV D FKHFN DQG EDODQFH :H DQWLFLSDWHG WKDW SURSHU K\JLHQH ZRXOG EH DW ULVN DQG QHHG WR EH PRGLILHG KRZHYHU ZH KDYH EHHQ DEOH WR DFKLHYH WKH VDPH H[FHOOHQW TXDOLW\ UHVXOWV DIWHU LPSOHPHQWLQJ WKH &2//(&7,6
*' +DYH \RX QRWLFHG D GLIIHUHQFH LQ VHPHQ RXWSXW SHU ERDU DIWHU WKH &2//(&7,6 KDG EHHQ LQVWDOOHG"
.0 :H KDYHQ¶W REVHUYHG DQ LQFUHDVH RU GHFUHDVH EXW GRVH YROXPHV KDYH EHHQ PRUH FRQVLVWHQW
*' :KDW ZDV WKH HPSOR\HHV SHUFHSWLRQ RI WKH &2//(&7,6 "
.0 2XU HPSOR\HHV VHH WKH YDOXH LQ FUHDWLQJ D VDIH HQYLURQPHQW DQG ZHUH ZLOOLQJ WR ZRUN ZLWK FKDQJH 6XUH WKHUH ZHUH VRPH UHVHUYDWLRQV DQG WKH XQNQRZQV WKDW FRPH ZLWK DQ\ SURFHVV FKDQJH EXW WRGD\ HYHU\RQH LV RQ ERDUG
*' +RZ ZDV *HQHV 'LIIXVLRQ VHUYLFH DQG VXSSRUW" .0 *HQHV 'LIIXVLRQ KDV EHHQ VXSSRUWLYH IURP WKH WLPH ZH EHJDQ ORRNLQJ DW WKH SRVVLELOLWLHV :H KDG WR VHH WKH HTXLSPHQW LQ RSHUDWLRQ EHIRUH ZH FRXOG FRQVLGHU EULQJLQJ RQH LQWR RXU VWXG DQG *HQHV 'LIIXVLRQ ZDV YHU\ DFFRPPRGDWLQJ *HQHV 'LIIXVLRQ KHOSHG XV ZLWK WKH LQVWDOODWLRQ WUDLQLQJ WKH VWXG PDQDJHU DQG WUDLQHG D IHZ ERDUV
*' +DV WKH &2//(&7,6 GHOLYHUHG DV SURPLVHG"
.0 :H KDYH DFFRPSOLVKHG RXU JRDO WR FUHDWH D VDIH HQYLURQPHQW SUREDEO\ HYHQ PRUH VR WKDQ ZH H[SHFWHG ,¶P VXUH ZH ZLOO VHH PRUH EHQHILWV DV ZH PRYH WRZDUG LPSOHPHQWLQJ WKH &2//(&7,6 LQ ERWK EDUQV
*' :RXOG \RX UHFRPPHQG WKH &2//(&7,6 "
.0 7KH &2//(&7,6 KDV DOORZHG XV WR XVH WHFKQRORJ\ WR LPSURYH WKH SHUVRQDO VDIHW\ RI RXU HPSOR\HHV²D FRUH YDOXH IRU 0RQVDQWR ,W¶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
'LIIHUHQW /RFDWLRQV²'LIIHUHQW 6HW 8S 6WDQGDUG 3HQ 1R 0RGLILFDWLRQ
5HPRGHOHG 6WDQGDUG 3HQ
6WDQGDUG 3HQ ZLWK %RDU /LIW 6\VWHP
)LWV DQ\ H[LVWL QJ ID FLOLW\
&HQWUDO &ROOHFWLRQ 5RRP Z 3LW SHQV
&HQWUDO &ROOHFWLRQ 5RRP Z 3LW SHQV
&HQWUDO &ROOHFWLRQ 5RRP Z 3LW SHQV
&2///(&7,6 ² $ ZRUOGZLGH DFFODLPHG UHYROXWLRQ
GULMI H E HQV N U D 9 'H F
ZLUW G Q D KH / F L O W W UL VFK ² 1RY U R I 'HU 1U
O 3 L J D Q DWLR FV Q U H L ,QW 7RS 1
GULMI H E HQV N U D 9 F H '
&2//(&7,6 VSHFLILFDWLRQV 2QH &2//(&7,6 VHW LV PDGH RI
&2//(&7,6 ,09 7(&+12/2*,(6
x VSHFLILF GXPPLHV IRU
x x
x UHJXODWLRQ XQLW ZLWK
&2//(&7,6 YDJLQD
DXWRPDWH DQG VRIWZDUH
x DUWLILFLDO YDJLQDV
x 6SHFLILF VWXG\ RI &2//(&7,6
LPSOHPHQWDWLRQ
,QVWDOODWLRQ E\ RXU WHFKQLFLDQ GD\ 7UDLQLQJ RI \RXU RSHUDWRUV E\ RXU WHFKQLFLDQ GD\V
2QH &2//(&7,6 VHW LV IRU WR ERDUV GHSHQGLQJ RQ \RXU ODERU RUJDQL]DWLRQ DQG EXLOGLQJ OD\RXW
&2//(&7,6