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Case 0:16-cr-60195-DTKH Document 2 Entered on FLSD Docket 07/25/2016 Page 1 of 55

UNITED STATES DISTRICT C OU RT FOR TH E SO U TH ERN D ISTRICT OF FLO RID A

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UN ITED STATES O F A M ERICA V.

LA TA M A IRLINES GR O UP S.A., Defendant. /

DEFERRED PR O SECU TIO N AG REEM ENT

DefendantLATAM AIRLm ESGROUP S.A.(theCtcompanf'),pursuanttoauthority granted by the Com pany'sBoard ofD irectors,and the U nited StatesDepartm entofJustice,

CriminalDivision,FraudSection (thettoffice''l,enterintothisdeferredprosecutionagreement (thetçAgreemenf).

C rim inalInform ation and Acceptance ofResponsibilitv

The Com pany acknow ledgesand agreesthatthe Office w illfile the attached twocountcriminalInform ation in theU nited StatesD istrictCourtforthe Southern D istrictofFlorida

charging theCompany with (i)violating theinternalcontrolsprovisionsoftheForeign Corrupt

PracticesActof1977(:EFCPA''),asamended,15U.S.C.jj78m(b)(2)(B),78m(b)(5),and 78ff(a);and(ii)violatingtheFCPA'Sbooksandrecordsprovisions,15U.S.C.jj78m(b)(2)(A), 78m(b)(5),and78ff(a).lnsodoing,theCompany:(a)knowinglywaivesitsrightto indictment on thischarge,aswellasa11rightsto a speedy trialpursuantto the Sixth A m endm entto the U nited StatesConstitution,Title 18,U nited Stm esCode,Section 3161,and FederalRule of

CriminalProcedure48(b);and(b)knowinglywaivesanyobjectionwithrespecttovenuetoany

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chargesby theU nited Stdtesarising outofthe conductdescribed in the attached Statem entof Factsand consentsto the fsling ofthe lnform ation,asprovided underthe term softhis Agreem ent,in the United Su tesD istrictCourtforthe Southern D istrictofFlorida.

2.

The Company adm its,accepts,and acknow ledgesthatitis responsible under

U nited States1aw forthe actsofitsofficers,directors,employees,and agentsascharged in the Inform ation,and assetforth in the attached Statem entofFacts,and thatthe allegations described in the lnform ation and the factsdescribed in A ttachm entA aretrue and accurate. Should the

Offscepursue the prosecution thatisdeferred by thisAgreem ent,the Com pany stipulatesto the adm issibility ofthe Statem entofFactsin any proceeding,including any trial,guilty plea,or

sentencing proceeding,and w illnotcontradictanything in the Statem entofFacts atany such proceeding.

Term ofthe Aereem ent

ThisA greem entiseffective fora period beginning on the date on which the

lnfonuationisfiledandendingthree(3)yearsfrom thelaterofthedateonwhichthe lnformation isfiled orthedateon which theindependentcompliancemonitor(thettM onitor'')is

relinedbytheCompany,asdescribedinParagraphsl1-13below (thetETenn'').TheCompany agrees,how ever,that,in the eventthe Oftsce determ ines,in itssole discretion,thatthe Company hasknowingly violated any provision ofthisA greement,an extension orextensionsofthe term

ofthe A greem entm ay be imposed by the O ffice,in its sole discretion,forup to a totaladditional

timeperiodofoneyear,withoutprejudicetotheOffice'srighttoproceedasprovidedin Paragraphs 17-19 below . A ny extenjion ofthe Agreem entextendsallterm softhisAgreem ent,

including the term s ofthe m onitorship orreporting requirem entin A tlchm entD,foran equivalentperiod. Conversely,in the eventthe Office finds,in its sole discretion,thatthere 2

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exists a change in circum stances sufficientto elim inate the need forthe m onitorship orreporting requirem entin A ttachm entD ,and thatthe otherprovisionsofthisAgreem enthavebeen

satisfied,theTerm oftheAgreementmaybeterminatedearly.IftheCourtrejectsthe Agreem ent,aIlthe provisionsofthe Agreem entshallbe deem ed nulland void,and the Term shallbe deem ed to have notbegun.

R elevantConsiderations

4.

The O fficeentersinto thisA greem entbased on the individualfactsand

circum stancespresented by thiscase and the Com pany.Am ong the factorsconsidered w ere the following' .

(a)theCompanydidnottimelyvoluntarily disclosetheFCPA violationstotheOffice;it began cooperating w ith the Oftice in the investigation of the m atteronly afterthe publication ofpressreportsin Argentina appearing approxim ately fouryearsafterthe crim inalconductin 2006-07 thatstated thatboth A rgentine and Chilean law

enforcem entofficialshad comm enced investigations ofthe conduct;

(b)becauseofthedelayed disclosure,potentially relevantevidencewas lostor destroyed,including through the routine application ofda1 retention policies;

(c)theCompany fully cooperated with the Office'sinvestigation and providedall relevantfactsknown to the Company,including inform ation aboutindividuals involved in the m isconduct;

(d)theCompanyhadaninadequatecomplianceprogram atthetimeofthecriminal conduct' ,

(e)theCompanynow hasdesigned and isimplementing acomplianceprogram and system ofinternalaccounting controls,and hascom m itted to ensuring thatthese will 3

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continueto be implemented in a m annerthatsatisfiesthe elem entssetforth in Attachm entC to thisAgreem ent;

(9 theCompanyhasfailedtoremediateadequately,includingsignificantlyby failingto discipline in any w ay the employees responsible forthe crim inalconductrecounted in the statem entoffactsattached hereto asA ttchm entA ,including m isconductby at leastone high-levelCom pany executive,and thus the ability ofthe com pliance program to be effective in practice iscom prom ised;

(g)thenatureand seriousnessoftheoffense,

(h)theCompany'spriorhistory,whichincludesaguiltypleabyitssubsidiaryLAN Cargo in 2009 foritsinvolvem entfrom 2003 through 2006 in acrim inalconspiracy to fix pricesin theairline cargo industry;

(i) theCompany hasagreed to continue tocooperatewiththeOfficeassetforth inthis Agreem entin any investigation ofthe Company and itsofficers,directors,em ployees,

agents,businesspartners,and consultantsretating to violationsoftheFCPA ;

U) accordingly,afterconsidering(a)through(i)above,theCompanywillenterintoa deferred prosecution agreem ent,pay a crim inalpenalty of25% above the low end of U nited States Sentencing Guidelines range,and an independentcom pliance m onitbr

willbeimposedforaterm oftwentpseven(27)months,assetforthinthis A greem ent.

Future Cooperation and D isclosure Requirem ents

The Company shallcooperate fully w ith the Office in any and aIlm attersrelating to the conductdescribed in thisA greem entand Attachm entA and otherconductrelated to possible corruptpaym ents,false books,rรงcords,and accounts,orthe failure to implem ent 4

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adequateinternalaccountingcontrolsunderinvestigationbytheOffice,subjecttoapplicable1aw and regulations,untilthe laterofthe date upon w hich allinvestigationsand prosecutionsarising outofsuch conductare concluded,orthe end ofthe tenm specified in paragraph 3. Atthe requestofthe Off-ice,the Com pany shallalso cooperate fully w ith otherdom estic orforeign 1aw

enforcem entand regulatory authoritiesand agencies,aswellasthe M ultilateralD evelopm ent

Banks(tรปM DBs''),inany investigation oftheCompany,itsaffiliatesorrelated entities,orany of itspresentorform erofficers,directors,em ployees,agents,and consultants,orany otherparty,in

any and allmatters relating to the conductdescribed in thisA greem entand A ttachm entA and otherconductrelated to possible corruptpaym ents,false books,records,and accounts,orthe failure to implementadequate internalaccounting controlsunderinvestigation by the O ftsce.

The Company agreesthatitscooperation pursuantto thisparagraph shallinclude,butnotbe lim ited to,the follow ing:

The Com pany shalltruthfully disclose alIfactualinform ation not protected by a valid claim ofattorney-clientprivilege orwork productdoctrine w ith respectto its activities,those ofits aftsliatesand related entities,and those ofitspresentand form erdirectors,

officers,em ployees,agents,and consultants,including any evidenceorallegationsand internal orexternalinvestigations,aboutw hich the Company hasany know ledge oraboutwhich the O ffice may inquire. Thisobligation oftruthfuldisclosure includes,butisnotlim ited to,the

obligation ofthe Com pany to provide to the O ffice,upon request any docum ent,record orother tangible evidence aboutwhich the Office m ay inquire ofthe Com pany. b.

Upon requestofthe Office,the Com pany shalldesignate know ledgeable

em ployees,agents orattorneysto provide to the O fficethe inform ation and m aterials described

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inParagraph5(a)aboveonbehalfoftheCompany.ltisfurtherunderstoodthattheCompany m ustatalltim esprovide com plete,trtlthful,and accurate information.

The Company shalluse itsbestefforts to make available forinterviewsor testim ony,asrequested by the Office,presentorform erofficers,directors,employees,agents

and consultantsofthe Company. Thisobligation includes,butisnotlim ited to,sw orn testim ony

beforeafederalgrandjuryorinfederaltrials,aswellasinterviewswithdomesticorforeign1aw enforcem entand regulatory authorities. Cooperation underthisParagraph shallinclude identification ofw itnesseswho,to the know ledge ofthe Com pany,m ay have m aterial inform ation regarding the m attersunderinvestigation. d.

W ith respectto any inform ation,testim ony,docum ents,records orother

tangible evidence provided to the O ftsce pursuantto thisAgreem ent,the Com pany consentsto

anyandaIldisclosures,subjecttoapplicablelaw andregulations,toothergovernmental authorities,including United Statesauthoritiesand those ofa foreign governm ent,asw ellasthe M DBS,ofsuch m aterials asthe Office,in itssole discretion,shalldeem appropriate.

6.

ln addition to the obligationsin Paragraph 5,during the Term ofthe A greem ent,

should the Company learn ofcredible evidence orallegationsofaviolation ofU.S.federallaw , the Com pany shallpromptly reportsuch evidence orallegationsto the Office.

Pavm entofM onetaa Penaltv

TheO ffice and the Com pany agree thatapplication ofthe United States

SentencingGuidelines(iรปUSSG''ortEsentencingGuidelines'')todeterminetheapplicablefine range yieldsthe follow ing analysis:

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a.

The 2015 U SSG are applicable to this m atter.

b.

OffenseLevel.BaseduponUSSG j2B1.1,thetouloffenselevelis27, calculated as follow s:

(a)(1)

BaseOffenseLevel

(b)(l)(J)

Valueofbenefitreceivedmorethan$3,500,000

+18

(b)(10)(B) ConductoutsidetheUnitedStates TO TA L

27

BaseFine.BaseduponUSSG j8C2.4(a)(l),thebasefineis$8,500,000 (thetineindicatedintheOffenseLevelFineTable) d.

Culpability Score.Basedupon USSG j 8C2.5,the culpability scoreis6, calculated asfollows:

(a)

BaseCulpabilityScore

(b)(3) theunitoftheorganizationwithinwhich the offense was com m itted had 200 ormore em ployeesand an individualwithin high-level personnelofthe organization participated in, condoned,orw as willfully ignorantefthe offense

(g)(2) Theorganizationfullycooperatedinthe investigation,and clearly dem onstrated recognition and affirm ative acceptance ofresponsibility forits crim inalconduct TOTAL

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Calculation ofFine Rance: Base Fine

$8,500,000

M ultipliers

l.20(min)/2.40(max)

Fine Range

$10,200,000- $20,400,000

TheCompany agreestopay amonetary penalty in theamountof$12,750,000 to theUnited

StatesTreasurywithinten(10)daysofthefilingoftheInformation.'rheCompanyandthe O ffsce agree thatthispenalty isappropriate given the factsand circum stancesofthiscase,asset

forthabove.The$12,750,000penalty isfinaland shallnotberefunded.Furthermoresnothing inthisAgreementshallbedeemed anagreementby the Oftk ethat$12,750,000 isthemaxim um penalty thatm ay be imposed in any futureprosecution,and the Office isnotprecluded from arguing in any future prosecution thatthe Courtshould im pose a higherf' ine,although the Office

agreesthatunderthose circum stances,itwillrecom m end to the Courtthatany am ountpaid underthis Agreementshould be offsetagainstany fine the Courtim poses aspartofa future

judgment.TheCompanyacknowlddgesthatnotaxdeductionmaybesoughtinconnectionwith thepaymentofany partofthis$12,750,000penalty.

ConditionalRelease from Liabilitx

8.

SubjecttoParagraph l7-19,theOfficeagrees,exceptasprovidedinthis

A greem ent,thatitw illnotbring any crim inalorcivilcase againstthe Com pany relating to any ofthe conductdescribed in the attached Statem entofFactsorthe crim inallnformation filed pursuantto thisA greem entorforany otherconductbetween 2005 and 201lrelating to furnishing oroffering gifts,travel,and entertainm entto governm entofficialsin Argentina that the Com pany disclosed to the O fficepriorto the signing ofthisA greem ent. TheO ffice, 8

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however,m ay use any inform ation related to the conductdescribed in the attached Statem entof

FactsagainsttheCompany:(a)inaprosecutionforperjuryorobstructionofjustice;(b)ina prosecutionformakingafalsestatement;(c)inaprosecutionorotherproceedingrelatingtoany crimeofviolence;or(d)inaprosecutionorotherproceedingrelatingtoaviolationofany provision ofTitle26oftheUnited StatesCode.

ThisA greem entdoes notprovide any protection againstprosecution for any future conductby the Company.

ln addition,thisAgreem entdoesnotprovide any protection against prosecution ofany individuals,regardlessoftheiraffiliation with the Company.

Corporate Com pliance Proeram

The Company represents thatithas im plem ented and w illcontinue to im plem ent a compliance and ethicsprogram throughoutitsoperations,including those ofitsaffiliates,

agents,andjointventures,andthoseofitscontractorsandsubcontractorswhoseresponsibilities include interacting with foreign officialsorotheractivitiescarrying a high risk ofcorruption, designed to preventand detectviolations ofthe FCPA and otherapplicable anti-conuption Iaws.

10.

ln orderto addressany defk ienciesin its internalaccounting controls,policies,

and procedures,the Com pany representsthatithasundertaken,and w illcontinueto undertake in the future,in a m annerconsistentw ith al1ofitsobligationsunderthis Agreem ent,a review ofits existing internalaccounting controls,policies,and proceduresregarding com pliance w ith the

FCPA and otherapplicable anti-corruption law s. lfnecessary and appropriate,the Com pany will adoptnew ormodify existing internalcontrols,policies,and proceduresin orderto ensure that

the Company maintains:(a)asystem ofinternalaccounting controlsdesigned to ensurethe

makingandkeepingoffairandaccuratebooks,records,andaccounts;and(b)rigorousanti9

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corruption compliance code,standards,and proceduresdesigned to detectand deterviolationsof

the FC PA andotherapplicableanti-corruption laws.Theinternalaccounting controlssystem and com pliance code,standards,and procedures willinclude,butnotbe lim ited to,the m inim um elem entssetforth in Atu chm entC. IndenendentCom pliance M onitor Prom ptly afterthe O ffice'sselection pursuantto Paragraph 12 below ,the Company agreesto retain aM onitorfortheterm specified in Paragraph l3. The M onitor's dutiesand authority,and the obligationsofthe Com pany w ith respectto the M onitorand the O ffice,are setforth in Attachm entD ,w hich isincorporated by reference into thisAgreem ent.

W ithinthirty(30)calendardaysaftertheexecutionofthisAgreement,andafterconsultation withtheOffice,theCompanywillproposetotheOfficeapoolofthree(3)qualifiedcandidates to serve asthe M onitor.'Ifthe Office deterlnines,in itssole discretion,thatany ofthe candidates are not,in fact,qualified to serve asthe M onitor,orifthe O ffice,in its sole discretion,is not satisfied with the candidatesproposed,the Office reservesthe rightto seek additional nom inatipnsfrom the Company. The M onitorcandidatesortheirteam m embersshallhave,ata m inim um ,the follow ing qualifications: a.

demonstrated expertise w ith respectto the FCPA and otherapplicable

anti-corruption law s,including experience counseling on FCPA issues' ,

b.

experiencedesigning and/orreviewing comoratecompliancepolicies,

procedures and internalcontrols,including FCPA and anti-corruption policies,procedures and internalcontrols;

the ability to accessand deploy resourcesas necessary to discharge the

M onitor'sdutiesasdescribed intheAgreement;and 10

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d.

sufficientindependencefrom theCompanyto ensure effectiveand

impartialperformance oftheM onitor'sdutiesasdescribedin theAgreement. l2.

TheOffkeretainstheright,in itssolediscretion,to choosetheM onitorfrom

am ong the candidatesproposed by the Com pany,though the Com pany m ay express its

preferencets)amongthecandidates.lntheeventthcOfficerejectsa1lproposedM onitors,the Company shallproposeanadditionalthreecandidateswithinthirty(30)calendardaysafter

receivingnoticeoftherejection.ThisprocessshallcontinueuntilaMonitoracceptabletoboth parties ischosen.The Office and the Com pany w illuse theirbesteffortsto complete the

selectionprocesswithinsixty(60)calendardaysofthetilingoftheAgreementandthe accom panying Inform ation.

lftheM onitorresignsorisothenvise unable to fulfillhis orher

obligationsassetouthereinandinAttachmentD,theCompanyshallwithinthirty(30)calendar daysrecommend apoolofthreequalifiedM onitorcandidatesfrom which theOfficew illchoose a replacement.

13. TheM onitor'sterm shallbetwenty-seven(27)monthsfrom thedateonwhichthe

M onitorisrelinedbytheCompany,subjecttoextensionasdescribedinParagraph3.The M onitor'spow ers,duties,and responsibilities,asw ellas additionalcircum stances thatm ay supportan extension ofthe M onitor'sterm ,are setforth in Attachm entD . The Com pany agrees thatitw illnotem ploy orbe affiliated w ith the M onitororthe M onitor's flrm fora period ofnot

lessthantwo(2)yearsfrom thedateonwhichtheM onitor'sterm expires.Norwillthe Com pany discussw ith the M onitororthe M onitor'sรปrm the possibility offurtherem ploym ent oraffiliation during the M onitor'sterm .

14.

A fterthe conclusion ofthe m onitorship,provided allrequirem entssetforth in

Paragraph 8 ofAttachm entD are m et,the Com pany w illreporton itscompliance to the Office 11

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once,with such reportbeing due tw o m onthspriorto the com pletion ofthe Term .ofthis Agreem ent,regarding rem ediation and im plem enl tion ofthe enhanced com pliance m easuresset

forthbytheMonitoras(iescribedinParagraph#ofAttachmentD.TheCompanyshall designate a seniorcom pany officerasthe person responsible foroverseeing the Company's

corporatecompliance reporting obligations. Duringthisperiod,theCompanyshallconductand preparethereview and reporq asdescribedbelow : a.

The Com pany shallundertake the review im lnediately atthe end ofthe

m onitorship,and shallincom orate the Office's viewsand com m ents on the m onitor'sprior review sand reports,to detennine w hetherthes policiesand procedures ofthe Com pany are reasonably designed to detectand preventviolationsofthe FCPA and otherapplicable

anticorruption laws. The reportshallbe transm itted to the FCPA Chief,Fraud Section,Crim inal Division,U .S.Departm entofJustice,1400 N ew York Avenue,W ashington,D .C.20005. b.

The review and reportshallbe com pleted by no laterthan two-hundred-

ten(210)calendardaysaftertheapprovalbytheOfficeoftheenhanced compliancemeasures described in Paragraph 8 ofAttachm entD . Thatreportshallbe com pleted and delivered to the

Officenolaterthansixty(60)daysbeforetheendoftheTerm.

The Com pany m ay extend the tim e period forsubm ission ofthe report

w ith priorwritten approvalofthe Office.

Deferred Prosecution

15.

Inconsiderationof:(a)thepastandfuturecooperationoftheCompany

describedinParagraphs4and5above;(b)theCompany'spaymentofacriminalpenaltyof $12,750,000;and(c)theCompany'simplementationandmaintenanceofremedialmeasuresas described in Paragraphs 9 and 10 above,the Office agrees thatany prosecution ofthe Com pany 12

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forthe conductsetforth in the attached Statem entofFacts and lnfonnation beand llereby is

deferredfortheTerm ofthisAgreement.

16. The O ftsce furtheragreesthatifthe Company fully com pliesw ith aIlofits obligations underthisA greement,the Office willnotcontinuethe crim inalprosecution against the Com pany described in Paragraph 1and,atthe conclusion ofthe Term ,thisA greem entshall

expire.W ithinsix(6)monthsoftheAgreement'sexpiration,theOfficeshallseekdismissal

withprejudiceofthecriminallnformationfiledagainsttheCompanydescribed inParagraph1, and agreesnotto file chargesin the future againstthe Com pany based on the conductdescribed

in thisA greem entand Attachm entA orthe lnform ation orforotherconductbetwecn 2005 and 201lrelating to funzishing oroffering gifts,travel,and entertainm entto governmentoftscials in A rgentina thatthe Com pany disclosed to the O ffice priorto the signing ofthisA greem ent.

Breach ofthe A ereem ent

If,during theTerm ofthisAgreement,theCompany (a)com mitsany felony

underU.S.federallaw;(b)providesinconnectionwiththisAgreementdeliberatelyfalse, incom plete,orm isleading inform ation,including in connection with itsdisclosure ofinform ation

aboutindividualculpability;(c)failstocooperateassetforthinParagraphs5and6ofthis Agreement;(d)failstoimplementacomplianceprogram assetforthinParagraphs9and l0of thisAgreementandAttachmentC;(e)commitsanyactsthatshadtheyoccurredwithinthe

jurisdictionalreachoftheFCPA,wouldbeaviolationoftheFCPA;or(8 othenvisefails specifically to perform orto fulfsllcom pletely each ofthe Com pany'sobligationsunderthe A greem entsregardlessofw hetherthe Office becom es aware ofsuch a breach afterthe Term of

theAgreementiscomplete,theCompanyshallthereafterbesubjecttoprosecutionforany federalcrim inalviolation ofwhich the O ffice hasknow ledge,in' cluding,butnotlim ited to,the 13

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charges in the lnform ation described in Paragraph 1,which m ay be pursued by the Office in the

U.S.DistrictCourtfortheSouthern DistrictofFloridaorany otherappropriatevenue.

Determ ination ofw hetherthe Com pany hasbreached theA greem entand w hetherto pursue prosecution ofthe Com pany shallbe in the Office's sole discretion. Any such prosecution m ay beprem ised on infonnation provided by the Com pany oritspersonnel. Any such prosecution relating to the conductdescribed in the attached Statem entofFactsorrelating to conductknow n * to the Office priorto the date on which thisA greem entwas signed thatisnottim e-barred by the

applicable statute oflim itationson the date ofthe signing ofthisA greementm ay be com m enced

againstthe Com pany,notw ithstanding theexpiration ofthe statute ofIilnitations,between the signing ofthisA greem entand the expiration oftheTerm plus one year. Thus,by signing this Agreem ent,the Com pany agreesthatthe statute of lim itationsw ith respectto any such

prosecution thatisnottim e-barred on the date ofthe signing ofthisA greem entshallbe tolled for the Ten' n plusone year. ln addition,the Company agreesthatthe statute oflim itations asto any violation offederallaw thatoccursduring the Term w illbe tolled ffom the date upon which the violation occursuntilthe earlierofthe date upon which the Officeism ade aw are ofthe violation orthe duration ofthe Term plus fiveyears,and thatthisperiod shallbe excluded from any calculation oftim e forpurposes ofthe application ofthe statute oflim itations. ln the eventtheO ffice determ inesthatthe Com pany hasbreached this Agreem ent,the Office agreesto provide the Com pany w ith written notice priorto instituting any

prosecutionresultingfrom suchbreach.W ithinthirty(30)daysofreceiptofsuchnotice,the Com pany shallhavethe opportunity to respond to the Office in w riting to explain the nature and

circum stancejofthe breach,aswellasthe actionsthe Com pany hastaken to addressand

14

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remediate the sisuation,which the O ftice shallcolzsiderin determ ining w hetherto pufĂšue prosecution ofthe Com pany.

19.

In the eventthatthe Office determ inesthatthe Com pany has breached this

Agreem ent: (a)alIktatementsmadeby oron behalfoftheCompanytotheOfficeorto the Courqincluding theattached StatementofFacts,and any testimony givenby theCompany

beforeagrandjury,acourt,oranytribunal,oratanylegislativehearings,whetherprioror subsequentto thisA greem ent,and any leadsderived from such statem entsortestim ony,shallbe adm issible in evidence in any and alIcrim inalproceedings broughtby the Office againstthe

Company;and (b)theCompany shallnotaqsertanyclaim undertheUnited StatesConstitution,

Rule1l(9 oftheFederalRulesofCriminalProcedure,Rule410oftheFederalRulesof Evidence,orany otherfederalrule thatany such statem ents ortestim ony m ade by oron behalfof the Com pany priororsubsequentto thisA greem ent,orany leadsderived therefrom ,should be suppressed orareothenviseinadm issible. The decision whetherconductor statementsofany currentdirector,officeroremployee,orany person acting on behalfof,oratthe direction of,the Company,w illbe im puted to the Com pany forthe purpose ofdeterm ining whethertheCom pany hasviolated any provision ofthis Agreem entshallbe in the sole discretion ofthe O ffice.

The Company acknowledgesthatthe Office hasm ade no representations,

assurances,orprom isesconcerning whatsentence may be im posed by the Courtifthe Company

breachesthisAgreementandthismatterproceedstojudgment.TheCompanyfurther acknow ledgesthatany such sentence is solely within the discretion ofthe Courtand thatnothing in thisA greem entbindsorrestrictsthe Courtin the exercise ofsuch discretion.

Thirty(30)daysaftertheexpirationoftheperiodofdeferredprosecution specified in thisA greement,the Com pany,by the ChiefExecutive Officerofthe Com pany and 15

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the ChiefFinancialO fticerofthe Com pany,w illcertify to the D epartm entthatthe Com pany has m etitsdisclosure obligationspursuantto Paragraph 6 ofthisAgreem ent. Each certification w ill be deem ed a materialsutem entand representation by the Company to the executive branch of

theUnitedStatesforpurposesof18U.S.C.j 1001,anditwillbedeemedtohavebeenmadein

thejudicialdistrictinwhichthisAgreementisfiled.

Sale.M eraer.or O therC hanee in Corporate Form ofC om panv

22.

Exceptasm ay otherwise be agreed by the Company and the Office in connection

withaparticulartransaction,theCompanyajreesthat,intheeventthat,duringtheTerm ofthe Agreem ent,itundertakesany change in corporate form ,including ifitsells,m erges,ortransfers

a substantialportion ofits business operations asthey existasofthe date ofthisA greem ents whethersuch sale is structured asa sale,assetsale,m erger,transfer,orotherchange in com orate form ,itshallinclude in any contractforsale,m erger,transfer,orotherchange in com orate form aprovision binding the purchaser,orany successorin interest,to the obligationsdescribed in this

Agreement.TheCompanyshallobtainapprovalfrom theOfficeatleastthirty(30)dayspriorto itor itsBoard ofDirectorsproposing to its shareholdersthe undertaking ofany such sale, m erger,transfer,orotherchange in corporate form ,including dissolution,in orderto give the Office an opportunity to determ ine ifsuch change in cprporate form would affectthe term sor obligationsofthe A greem ent. Ifthe Company concludesthatin particularcircum stances complying w ith the previous sentence w ould place itin violation ofChilean Iaw ,the Company shallprom ptly notify the O ffice ofsuch conclusion,and the Com pany and the O ffice w illseek to reach agreem enton how to proceed;in no event,however,w illthe Com pany proceed to close

16

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any transaction thatresults in a change in com orate form priorto reaching an agreem entw ith the

Office.

Public Statem entsbv Com panv The Company expressly agrees thatitshallnot,through presentorfuture

attorneys,officers,directors,em ployees,agents orany otherperson authorized to speak forthe Com pany make any public statem ent,in litigation orotherw ise,contradicting the acceptance of

responsibility by the Com pany setforth above orthe factsdescribed in the atl ched Statem entof

Facts.Anysuchcontradictorystatementshall,subjecttocurerightsoftheCompanydescribed

below,constituteabreachofthisAgreement,andtheComh panythereaftershallbesubjectto prosecution assetforth in Paragraphs l7-19 ofthis Agreem ent. The decision whetherany public statementby any such person contradicting a factcontained in the Statem entofFactsw ill be im puted to the Com pany forthe purpose ofdeterm ining whetherithasbreached this

A greem entshallbe atthe sole discretion ofthe O ffice. lfthe Office determ inesthata public statem entby any such person contradicts in w hole orin parta statem entcontained in the Statem entofFacts,the O ffice shallgo notify the Company,and the Com pany m ay avoid a

breach ofthisAgreementbypublicly repudiating such statementts)within five(5)businessdays afternotification. The Com pany shallbe perm itted to raise defensesand to assertaftirmative claims in otherproceedingsrelating to the m atterssetforth in the Statem entofFactsprovided thatsuch defensesand claim sdo notcontradict,in whole orin part,a statem entcontained in the Statem entofFacts. ThisParagraph doesnotapply to any statem entm ade by any presentor form erofficer,director,employee,oragentofthe Com pany in the course ofany crim inal, regulatory,orcivilcase initiated againstsuch individualsunlesssuch individualisspeaking on

behalfofthe Company. l7

Case 0:16-cr-60195-DTKH Document 2 Entered on FLSD Docket 07/25/2016 Page 18 of 55

24.

The Com pally agreesthatifitor any ofits directorindirectsubsidiariesor

affiliatesissuesapressrelease orholdsany pressconference in connection with thisA greement,

theCompanyshallfirstconsultwiththeOfficetodetermine(a)whetherthetextofthereleaseor proposed statem entsatthepresscĂŠnference are true and accurate w ith respectto matters between

theOfficeandtheCompany;and(b)whethertheOfficehasanyobjectiontotherelease.

The Office agrees,ifrequested to do so,to bring to the attention oflaw enforcem entand regulatory authoritiesthe facts and circum stancesrelating to thenature ofthe conductunderlying thisA greem ent,including the nature and quality ofthe Company's cooperation and rem ediation. By agreeing to provide thisinform ation to such authorities,the

O ffice isnotagreeing to advocate on behalfofthe Com pany,butratheris agreeing to provide factsto be evaluated independently by such authorities.

Lim itationson BindineFcffectofAereem ent 26.

ThisA greem entisbinding on the Com pany and the Officebutspecifically does

notbind any othercomponentofthe Departm entofJustice,otherfederalagencies,orany state,

localorforeign law enforcem entorregulatory agencies,orany otherauthorities,although the O ffice w illbring the cooperation ofthe Com pany and itscom pliancew ith itsotherobligations underthisA greem entto the attention ofsuch agenciesand authorities ifrequested to do so by the Com pany.

N otice

27.

Any notice to the O ffice underthisA greem entshallbe given by personal

delivery,overnightdelivery by arecognized delivery service,orregistered orcertified mail,

addressed to FCPA Chief,Fraud Section,Crim inalD ivision,U .S.Departm entofJustice,1400 N ew Y ork A venue,W aslzington,D .C .20005.Any notice to the Company underthisA greement 18

Case 0:16-cr-60195-DTKH Document 2 Entered on FLSD Docket 07/25/2016 Page 19 of 55

shallbe given by personaldelivery,overnightdelivèry by a recognized delivery service,or

registered orcertified m ail,addressed to Claudio Salas, 7 W orld Trade Centers250 Greenwich Street,N ew Y ork,N ew York 10007.N otice shallbe effective upon actualreceiptby the Office orthe Company.

Com plete Aereem ent

28.

ThisA greement,including its attachm ents,setsfol'th allthe term softhe

agreem entbetween the Com pany and the O ftice. N o am endments,m odiGcationsoradditionsto

19

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thisAgTetmentslmllbevalid unlesstlwy are in writing and siganed by theOftke,theattom eys fortheCom pany and adulyauthorized representativeoftheCompany.

AGREED:

FOR IA TAM AIRLINES GROUP S.A .:

o-te,7 1 26, 13* .

By: MdresOsorio Her-mansen LATAM AIRLIN ES GROUP S.A. *

alzs-lllo

'

Date:

SX:

j

#- . 1 .

RogerM .W itten W ilmerCutlerPickeringHaleand DolT LLP

FOR THE DEPARTM ENT OF JUSTICE: Andrew W eissmamt Cbief,Fraud Section Crim inalDivision United StatesDepnrtmentofJustice

Date;-/l-s. se/tke

i'

BY:

20

l w Jason inder Sczti rTHalAttom ey

trx

Case 0:16-cr-60195-DTKH Document 2 Entered on FLSD Docket 07/25/2016 Page 21 of 55

COM PAN Y OITICER 'S CAIRVI'I>ICA' FE 1havereadthisAveementand carefullyreviewed everypartofitwith outsidecounsel

forLatam AirlinesGroupS.A.(theX ompany''l.1understandthetermsofthisAgreementand voluntarily agree,on behalfofthe Com pany,to each ofitsterm s. Before signing tbis

Agreement,Iconsultedoutidecounselforthe Company.Cotmselfully advised meoftherights oftheCom pany,ofpossible defenses,ofthe Sentencing Guidelines'provisions,and ofthe consequencesofentering into thisAp eem ent.

1have catefully reviewed thctcrm softhisA greem entw ith theBoard ofD irectors ofthe

Company.lhaveadvised andcam ed outsidecounselfortheCompanyto advisotheBoardof Directorsfully oftherightsoftheCompany,ofpossibledefenses,oftheSentencing Cyuidelines' provisions,and ofthe consequencesofentering into the Agreem ent.

Nopromisesorinducementshavebeen madeotherthanthosecontainedinthis A greem ent. Furtherm ore,no one hmqtbreatened orforoed m e,orto m y knowledge any person

authorizingthisAgreementonbehalfoftheCompmm in anywaytoenterintothisApeement.

Iam alsosatissedwith outsidecounsel'srepresentation inthism atter.Icert' tfythatIam the CFO forthe Company and i atIhavebeen duly autborized by the Com pany to execute this Agv m enton behalfofthe Company.

Date:7 zf )l$ LATAM

(A O

By:

An - dres Osono H erm ansen cFO

.A.

Case 0:16-cr-60195-DTKH Document 2 Entered on FLSD Docket 07/25/2016 Page 22 of 55

'

CER TIFICATE O F C O UN SEL

Iam counselforLatam AirlinesGroup S.A.(theitcompany'')inthemattercoveredby this Agreem ent. ln connection with such representation,Ihave exam ined relevantCom pany

documentsandhavè'disiussed theterm softhisAgreembnfk iththe Company Boardof Directors. Based on ourreview ofthe foregoing m aterialsand discussions,1am ofthe opinion thatthe representative ofthe Com pany hasbeen duly authorized to enterinto thisA greem enton behalfofthe Com pany and thatthis Agreem enthas been duly and validly authorized,executcd,

and delivered onbehalfofthe Company and isavalidand bindingobligation oftheCompany.

Further,lhavecarefully reviewed the term s ofthisA greem entwith the Board ofDirectorsand the CFO ofthe Com pany. lhave fully advised them ofthe rightsofthe Com pany,ofpossible defenses,oftheSentencing Guidelines'provisionsand ofthe consequencesofentering into this# w

A greem ent. To m y knowledge,the decision ofthe Company to enterinto thisA greem ent,bascd on the authorization ofthe Board ofDirectors,is an inform ed and voluntary one. ,

oate:7/2Ljytv -

By: fozr m zpp.p';.

zy

RogerM .W itten

WilmerCutlerPickeringHaleandDorrLLP CounselforLatam A irllnes Group S.A .

Case 0:16-cr-60195-DTKH Document 2 Entered on FLSD Docket 07/25/2016 Page 23 of 55

A TTA CHM EN T A STATEM EN T OF FA CTS

Thefollow ing Statem entofFactsisincom orated by reference as pal4 ofthe Deferred u. .

ProsecutionAgreementy( ihetjjAgr eementyy)betweentheUnitedStatesDepartmentofJustice,

CriminalDivision,FraudSection(thetioffice'')andLatam AirlinesGroupS.A.CtLATAM'')as successor-in-interesttoLAN AirlinesS.A.(t1LAN'').LATAM herebyagreesandstipulatesthat the follow ing inform ation istrue and accurate. LATAM adm its,accepts,and acknowledgesthat

itisresponsible forthe acts ofitsoffscers,directors,employees,and agents,aswellas forthe actsoftheofficers,directors,em ployees,and agentsofLAN asitspredecessor-in-interest,as set 4

forth below . Should the Oftk epursue theprosecution thatis deferred by this Agreem ent, LATAM agreesthatitw illneithercontestthe adm issibility of,norcontradict,thisStatem entof Factsin any such proceeding. The following facts establish beyond a reasonable doubtthe

charges setfbrth in the crim inallnform ation attached to thisAgreem ent: LAN and OtherRelevantEntitics and Individuals LAN w as,until2012,an airline com pany incorporated and headquartered in Chile

thatprovided passengerand cargo transportation throughoutSouth and CentralA merica,asw ell asto the United States,Europesand A ustralia. D uring the relevantperiod,LAN had annual

revenuesofapproxim ately $3.5 billion.Until2012,sharesofLAN'Sstocktradedon theNew

YorkStockExchangeC4NYSE'')asAmericandepositoryreceipts(&ĂŠADRs'')5andLAN was required to fileperiodic reportsw ith the Securities and Exchange Com m ission underSection

l5(d)oftheSecuritiesExchangeAct,15 U.S.C.j78o(d).Accordingly,LAN wasan ktissuer''as

thatterm isusedintheForeignCorruptPracticesAct(tTCPA''),Titlel5,UnitedStatesCode, Section 78m . ln June 2012,LAN becam e LA TAM afterm erging w ith TAM S.A . Afterthe

Case 0:16-cr-60195-DTKH Document 2 Entered on FLSD Docket 07/25/2016 Page 24 of 55

m erger,LATAM 'Ssharestraded on the N YSE asA DRS,and LATAM wasrequired to file

periodicreportswiththeSecuritiesandExchangeCommissionunderSection l5(d)ofthe SecuritiesExchangeAct,15U.S.C.j78o(d).Accordingly,LATAM wasanissuerwithinthe m eaning oftheFCPA ,Title l5,U nited States Code,Section 78m . LATAM w as incorporated

and headquartered in Chile.

Untilthe 2012 m erger,LAN Cargo wasa subsidiary ofLAN ;thereafter,itwasa subsidiary ofLATA M . LAN Cargo wasincorporated in Chile,headquartered in M iam i,Florida, and had severalotheroffices in the U nited States. Itprovided cargo transportation w ithin South and CentralAm erica,and between South and CentralAm erica and the restofthe w orld.

Untilthe20l2merger,AtlanticAviationInvestmentsLLC (tĂŠAAl'')wasa subsidiary ofLAN ;thereafter itwas a subsidiary ofLA TAM . AA 1wasincorporated in D elaware and headquartered in Chile. A Al'sfinancialstatem entsw ere consolidated into the financialstatem entsofLAN and laterLATA M .

StLAN Executive,''an individualwhose identity isknow n to the United States, wasa high-levelexecutiveatLA N .

tĂťLAN Cargo Executive,''an individualwhose identity isknown to the U nited States,was a high-levelExecutiveatLAN Cargo during the relevantperiod. LAN Cargo Executive was responsible,along w ith LAN Executive and otherLAN executives,forleading LA N 'Sentry into the Argentine airline m arketduring the relevantperiod. LAN Cargo Executive w asbased in M iam i,Florida,and wasa United Su tescitizen.

6.

ttconsulunt,''''an individualwhose identify isknown to the United States,wasan

advisorto the Secretary ofA rgentina'sM inistry ofTransportation during the relevantperiod. He wasappointed to thatposition pursuantto an unpublished resolution.

A -2

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ILAN 'S Fa/ry into theA rgentlneM arket

LAN soughtentry into the A rgentine com m ercialairline m arketin the early 2000s. Atthe tim e,Argentina prohibited foreign-ow ned airlines from operating in the country,

so LAN looked fora localArgentinecorfipany in which itcouldacquirea minority interest. ln 2004 and 2005,LAN engaged in discussionswith governm entofficialsfrom A rgentina'sM inistry ofTransportation abouta variety of issuessurrounding itsentry into the

market,including:(a)which localairline itcould acquire (thegovem menthadtoapproveits

acquisition);(b)revisingthelaw topennitLAN toownamajorityofthatcompany;(c)granting LAN additionalroutesw ithin Argentina itcould operate once ithad established operationsin the

country;(d)raisingthemaximum allowableticketprices,whichweresetbythegovernment' ,and (e)laborissuesthataroseafteritenteredthemarket.

9.

By early 2005,LAN had agreed w ith offlcials from the Argentine M inistry of

Transportation thatitwould acquire the defunctArgentine airline,A ero 2000,w hich had no

active operations. A spartofthatagreem ent,LA N also agreed to em ploy the laborforcesfrom two otherdefunctairlines,LA FSA and Southern W inds. ln return forthatcom m itment, Argentine governm entofficialsagreed thatthe officialswould revise the law so thatLAN could

ownamajorityoftheairlineithadacquired,wouldraisethecaponmaximum airfares,and would grantLAN additionaldom estic routes.

How ever,LAN 'Srelationship with the laborunionsrepresenting itsinherited workforce began deteriorating during thistim e fram e. The tension focused on the so-called ttone function rule,''which m andated thateach employee could engage in only one,narrow ly-defined

type ofwork. A lthough LAN 'SIaborunionsdid notstrictly enforce the rule in practice,the

A-3

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unionsthreatened to do so,which w ould have had the effectofsignificantly increasing LA N 'S Iaborexpenses.

The Ffc/ftfolu Consulting Agreem ent

14.

ln Septeihberand October2006,LAN negotiatedand executedafictitious$1.15

m illion consulting agreem entwith Consultant,through a com pany he ow ned and operated,in orderto funnelbribes to labor union officials. A sa resultofthese corruptpaym ents,LAN 'S unionshad agreed notto enforce the one function rule fora period ofyearsand had accepted substantially lowerwage increasesthan they had been dem anding.

15.

LAN Cargo Executive negotiated the fk titiousagreem entw ith Consultanton

behalfofLA N ,while keeping LAN Executive informed ofthe negotiation'sprogress. On Septem ber23,2006,forexample,LA N Cargo ExecutivesentLAN Executive an em ailw ith the

subjectlineGsropicclosedforthemoment.'' ln it,LAN CargoExecutiveadvisedLAN Executivethatttgtlhecostwouldbel,000plus15%,55witht:1/3tobepaidimmediately,another l/3 in 30 and 60 days. lexpectOct llm ov lland D ec 11.''

O n October2,2006,Consultantem ailed LAN Cargo Executive a draftofthe agreem ent,copying a high-levelofficialin the M inistry ofTransportation. Am ong other responsibilities,the high-leveloffk ialwas involved in LAN 'Snegotiationswith itsIaborunions.

The draftagreem entbetween LAN and Consull nt'scompany stated that Consultant'scom pany t:isspecialized and hasbroad experience in providing advisory serviceson

thesubjectoftransportationintheArgentineRepublicandtheregion....''Underthetermsof thedraftagreem ent,the consulting com pany purportedly w asto: undertake a study ofexisting airroutes in theA rgentine Republic and the regionalm arket,including those being serviced by differentairlines,as wellasthose w ith no service available at A -4

Case 0:16-cr-60195-DTKH Document 2 Entered on FLSD Docket 07/25/2016 Page 27 of 55

present. The study m izktinclude,am ong otherdata:each ofthe pointsto be connected by each ofthe routes,possible

combinatlons,eventualconnections,estimatedpassengervolumes throughoutthe year,especially differentiating w eekdaysfrom

weekends,andparticularlythosedominated(siclaslong w eekends. Thisstudy m ustinclude an estim ate ofthepotentialair cargรถ dem andsforeach ofthe routes.

18.

Further,the draftagreem entcontem plated thatConsultant's com pany w ould

perform legalanalysisonLAN'Sbehalf:ktlwlithintheframeworkoftheIaw governingPublicPrivatePartnerships(PPP)intheArgentineRepublic,(LANIassigns(Consultant'scompanylthe task ofstudying and analyzing said Iaw and itspotentialapplication to the differentservices

providedby(LAN).''ThedraftagreementgaveConsultant'scompanyuptoninetydaysttto deliverthe study w ith the requested services.''

l9.

In exchange forthese purported services,the draftagreem entprovided thatLA N

would pay Consultant'scompany $4afixedsum ofUS$ l,150,00095payablein fourinstallments: $300,000on signing;$300,000atboth thirty and sixty daysaftersigning;andthe rem aining $250,000paid ninety daysaftersigning.

LAN Cargo Executive forwarded the draftagreem entto LAN Executive on October3,2006,the day afterLAN Cargo Executive had received it. LAN Cargo Executive reached agreementw ith Consuluntand LA N Executive approved iteven though they both knew thatthe draftagreement'sdescription ofthe servicesthatConsultant's com pany w ould provide w ere false. Rather,both understood thatthe true pum ose ofthe draftagreem entwasto use Consultantto intercede on LAN 'Sbehalfwith the ofรปcialsofitsA rgentine laborunions.

FurthersLAN Cargo Executive knew and intended thatConsultantwould use som e ofthe m oney he received underthe draftagrqem entto bribe union officialsto acceptterm sm ore favorable to

A -5

.

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LA N . LAN Executive also understood thatConsultantm ightpasssom e ofthe money he'wĂ´tlld be paid underthe draftagreem entto union officials.

2l.

LAN and Consultant'scom pany neverfully signed and executed the fictitious

consulting agreem ent,and neitherthe Consultantnoranyone else affiliated w ith hiscom pany everperform ed any ofthe services specified in the draftagreem ent. Despite the absenceofa

fully executed agreem entand despite the failure ofConsultant'scom pany to perform the services specified in the draftagreem ent,Consultnt'scom pany invoiced LAN forpaym entunderthe

draftagreem entand a LA N affiliate paid those invoices.

22.

On October 18,2006,Consultantem ailed LAN Cargo Executive an invoice from

hiscompanytoLAN for$300,000tElfjorconsultingservicesprovidedbyandpayabletoyou undercontractsigned by both parties.'' ltdirected thatpaym entbe m ade to a W achovia account in Roanoke,V irginia,held in the name ofConsultantand hisw ife,notin the nam eofhis company. LAN paid thisinvoice from itsCitibank accountin N ew Y ork,on behalfofAA I, even

though(i)thecontracthadneverbeensigned,(ii)thefirstinvoicehadbeendirectedtoLAN (not AAl),(iii)theunsignedagreementhadbeenbetweenConsultant'scompanyandLAN,notAAI, and(iv)itwasnotacompanybankaccountreceivingthefunds.LAN CargoExecutivedirected Consultantto addressrem aining invoicesto A Al,notLA N .

23. tlnNovember21,2006,andJanuary 16,2007,Consultantemailedtwoadditional invoicesto LAN Cargo Executive,thefirstfor$300,000and thesecond for$550,000.80th invoices were addressed to A AI,both directed paym entbe m ade to the sam e V irginia W achovia

accountheldbyConsultantandhiswife,andbothinvoicesindicatedtheywerettltlorconsulting servicesprovided by and payable to you undercontractsigned by both parties.'' As before,LAN

paid both invoices on behalfofA AIfrom itsN ew York Citibank account.

A -6

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24. AllofthepaymentstoConsultant'scom/an# wereintentionallymis-recordedas Etotherdebtors''on the books,recordssand accountsofLAN 'SD elaw are subsidiary. LA N Executive approved the paym ents to Consultant'scom pany,knowing thatthepaym entsw ere

pursuantto an unsigned fictitiousconsulting agreem entwith Consulunt'scom pany.

OnNovember7,2007,LAN also paidan additional$58,000 to aNew York Bank

ofAmericaaccountinthenameofanothercompany,whichwasjointlyownedbyConsultant's w ife and son. The invoice forthatpaym ent,like the three from Consultant's com pany,falsely indicated thatthe paym entwasfortsconsulting servicesand studiesperform ed on the different

aerialroutes in the A rgentine Republicand in the regionalm arket.'' LAN did nothave an agreem entorarrangem entofany kind w ith thissecond com pany.

LAN obtained an estimatedbenefstof$6,743,932 asaresultoftheimproper paym entsto Consultant'scom pany to resolve LAN 'S union issues.

LAN 'SInternalA ccounting Controls

27.

D uring the relevantperiod,LAN know ingly and w illfully failed to implem enta

sufficientsystem ofinternalaccounting controls. ln particularand asrelevanthere,LA N had

deficientinternalaccounting contrqlsthatdid notrequire,among otherthings,(a)due diligence

fortheretentionofthirdpartyconsultants;(b)afullyexecutedcontractwithathirdpartybefore paymentcould bemadeto it;(c)invoicesissued to theLAN entity thatin factengaged thethird

party;(d)documentationorotherproofthatserviceshadbeenrenderedbyathirdpartybefore paymentcouldbemadetoit;(e)thatpaymenttothirdpartiesretainedbyLAN orLAN entities bemadetobankaccountsheldinthenamesofthosethirdparties;or(9 oversightofthepayment processto ensure thatpaym entswere m ade pursuantto appropriatecontrols,including those

described above.

A -7

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28.

LAN Executive,LAN Cargo Executive,and one otherhigh-levelLA N executive

knew thatthe servicesdescribed in the unsigned fictitiousagreem entw ith Consultant'scom pany w ere false,and thatthe true purpose ofthe paym entsm ade underitw ere to resolve LA N 'S disputesW ith itsA rgentine laborunions. AtleastLAN Cargo Executive,m oreover,knew that Consultantwould pay bribesto officialsofthe laborunions. LAN Executive and the otherhigh-

IevelLA N executive w ho knew aboutthe false nature ofthe agreem enthad the authority and responsibility to ensure thatLAN devised and m aintained an adequate system ofinternal accounting controls,knew thatLAN 'Sthen-existing internalaccounting controls failed to prevent

LAN from entering into an unsigned fictitious consulting agreem ent,and know ingly and w illfully failed to im plem entinternalaccounting controlsto addressthe known w eaknesses in partto perm itLA N to enterinto the contract.

A-8

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AW ACHM ENT B CERTIFICATE OF CORPOR ATE RESO LUTIONS -

W HEREAS, Latam Airlines Groups S.A. (the รปรงcompany'') hms been engaged in discussionswit. h theUnited StatesDcpartmentofJustice,CriminalDivisionaFraud Section (the

ROf15ce'')regardingissucsarisinginrelationtocertainfalsebookedpaymentsandanintentional failureto implem entintenlalaccotmting conkols;atld W HEREAS,in orderto resolve such discussions,itis prtlposed thatthe Company enter into a certain agreem entw1111theOffice;and

W HEREAS, the Company's SR .Vice President Legal Affairs, Juan Carlos M encio, together w ith outside counsel for the Compalm have advised the Board of Directors of the Company of its rights, possible defenses, the Sentencing Guidelines' provisiom , and the consequencesofentering into such agreem entwith the Oftice;

Therefore,the Board ofDizectorshasRESOLVED that:

TheCompany(a)acknowledgcsthefililzgofthetwo-countInformationcharging theCompanyw11 (i)violating thehztemalcontrolsprovisionsoftheFozeign CorlxptPractices

Actof1977C$FCPA''),asamended,15U.S.C.9j7#m(b)(2)(B),78m(b)(5),and78ff(a);and(ii) violatingtheFCPA'Sbooksandrecordspzovisionss15U.S.C.9j78m(b)(2)(A),78m(b)(5),and 78ff(a);(b)waivesindictmenton such chargesand cntersinto adeferredprosecution agreement with the Offlce; and (c) agrees to accept a monetary penalty against Company totaling $12,750,000,ahd to pay such penalty to tlleUnited StatesTreasury with respecttotlleconduct described in theInfbrm ation;

The Com pany acceptstlleterm salld conditionsoftllis Agreem ent,including,but

not limited to,(a) a krmwing waiver of its rights to a speedy trlalpursnantto the Sixth B-1

Case 0:16-cr-60195-DTKH Document 2 Entered on FLSD Docket 07/25/2016 Page 32 of 55

Amendmentto theUnited StatesConstimtion,Title 1% United StatesCode,Section 3161,and

FederalRule of CriminalProcedure 4809;and (b)a knowing waiver forptuposes oftMs Agreem ent and any charges by the United States arising out ofthe conduct described in the

attachedStatementofFactsofanyobjectionwithrespecttovenueandconsentstotheĂťlingof the Informationaas prtw ided under the terms of tltis Agreem ent,in the United States D istzict

CourtfortheSouthem DistrictofFlozida;and(c)aknowingwaiverofany defenscsbased onthe staG te of lim itations for any prosecution relating to tlte conduct described in the attached Statem ent of Facts or relating to conductknown to the Oftlce prior to the date on which this Agreementwassigned thatis nottim e-barred by the applicable statute oflimitationson the date ofthe signĂŻng ofthisAgreem cnt;

The ChiefFinancialOfficer(CFO)ofCompany,Andres Osorio Hennansen,is hereby authorized,empow ered and directed,on behalfofthe Company,. to execute the Defen' ed Prosecution Agreem entsubstr tially in such form asreview ed by tllisBoard ofDirectors atthis

meetingwith such changesastheChiefFinancialOfficer(CFO)ofCompany,AndresOsorio H erm ansen,m ay approve;

4.

The ChiefFinancialOfficer (CFO)ofCompany,Andres Osorio Hermansen is

hereby authorized,empowered and directed to take any and al1actions asm ay be necessary or appropriate and to approve the fonns,term sorprovisionsofany agreem entor otherdocum ents

msmay be necessary orappropriate,to carry outand effectuate the pupose and intentofthe foregoing resolutions;arld

5.

A11ofthe actionsofthe ChiefFjnancialOm cer(CFO)ofCompany,Andres

Osorio Herm ansen,which actionswould have been authorized by the foregoing B-2

Case 0:16-cr-60195-DTKH Document 2 Entered on FLSD Docket 07/25/2016 Page 33 of 55

f

resolutions except that such actions were taken prior to the adoption of such resolutions, are bercby severdly ratified, conth-m ed, approved, and adopted as actions on behalf of thc Com pany.

Date: z./zz 1'r -

B y:

B-3

z

.

z' Corp te Secretary Lat AidintsGroup .A .

Case 0:16-cr-60195-DTKH Document 2 Entered on FLSD Docket 07/25/2016 Page 34 of 55

A TTA CHM EN T C C OR PO R ATE CO M PLIANC E PRO G M M

ln orderto addressany deficiencies in its internalcontrols,com pliance code,policies,

andproceduresregardingcompliancewiththeForeignCorruptPracticesAct(4:FCPA''),l5 U.S.C.jj7#dd-l,etseq.,andotherapplicableanti-corruptionlaws,LATAM AirlinesGroup S.A.(thettcompany'')agreestocontinuetoconduct,inamannerconsistentwithallofits obligations underthisA greem ent,appropriate review sofits existing internalcontrols,policies, and procedures.

W here necessary and appropriatesthe Com pany agreesto adoptnew orto m odify existing internalcontrols,compliance code,policies,and proceduresin orderto ensure thatit

maintains:(a)asystem ofinternalaccountingcontrolsdesignedtoensurethattheCompany makesandkeepsfairand accuratebooks,records,and accounts;and(b)arigorousanticorruption compliance program thatincludespoliciesand proceduresdesigned to detectand deterviolations ofthe FCPA and otherapplicable anti-corruption law s. A ta minim um ,this

should include,butnotbe lim ited to,the follow ing elem ents to the extentthey are notalready partofthe Company'sexisting internalcontrols,com pliance code,policies,and procedures: High-LevelCom mitm ent

1.

The Company willensure thatitsdirectorsand seniorm anagem entprovide

strong,explicit,and visible supportand com m itm entto itscorporate policy againstviolationsof the anti-corruption law sand itscompliance code.

Case 0:16-cr-60195-DTKH Document 2 Entered on FLSD Docket 07/25/2016 Page 35 of 55

Policiesand Procedures 2.

The Com pany willdevelop and prom ulgate a clearly articulated and visible

corporate policy againstviolationsofthe FCPA and otherapplicable foreign law counterparts

(collectively,thet&anti-corruptionlaws,''),whichpolicyshallbememorializedinawritten com pliance code.

The Company w illdevelop and prom ulgate com pliance policies and procedures designed to reduce the prospectofviolationsofthe anti-corruption law sand the Com pany's compliance code,and the Com pany w illtake appropriate m easuresto encourage and supportthe observance ofethicsand com pliance policiesand procedures againstviolation ofthe anticorruption law sby personnelatal1levels ofthe Company. These anti-corruption policies and procedures shallapply to a1ldirectors,officers,and em ployeesand,w here necessary and

appropriate,outsidepartiesactingonbehalfoftheCompanyinaforeignjurisdiction,including butnotlim ited to,agentsand interlnediaries,consultants,representatives,distributors,team ing

partners,contractorsandsuppliers,consortia,andjointventurepartners(collectively,ttagents and businesspartners'').TheCompany shallnotifyaIlemployeesthatcompliancewith the policiesand procedures isthe duty ofindividualsatalllevelsofthe company. Such policiesand proceduresshalladdress' . a.

gifts;

b.

hospitality,entertainm ent,and expenses' , custom ertravel;

d.

politicalcontributions; charitable donations and sponsorships' , C-2

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facilitation paym ents' ,and solicitation and extortion.

4.

The Com pany w illensure thatithasa system ofGnancialand accounting

procedures,including a system ofinternalcontrols,reasonably designed to ensurethe m aintenance offairand accurate bookssrecords,and accounts. This system should be designed to provide reasonable assurancesthat: transactionsareexecuted in accordance w ith m anagem ent'sgeneralor

specific authorization' , transactions are recorded asnecessary to perm itpreparation offinancial statem entsin conform ity w ith generally accepted accounting principlesorany othercriteria

applicable to such statem ents,and to m aintain accountability forassets; c.

accessto assetsisperm itted only in accordance w ith m anagem ent's

generalorspecific authorization;and

d.

the recorded accountability forassets iscom pared w ith the existing assets

atreasonable intervalsand appropriate action istaken w ith respectto any differences.

Periodic Risk-Based Review The Company willdevelop these com pliance policiesand procedureson the basis ofa periodic risk assessm entaddressing the individualcircum stances ofthe Com pany,in particulartheforeign bribery risksfacing the Com pany,includingsbutnotlim ited tosits

geographicalorganization,interactionsw ith varioustypesand levelsofgovernm entofficials,

industrialsectorsofoperation,involvementinjointventurearrangements,importanceoflicenses

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and perm itsin the Com pany'soperations,degree ofgovernm enl loversightand inspection,and volum e and importance ofgoodsand personnelclearing through custom s and im m igration.

6.

The Com pany shallreview itsanti-corruption com pliance policiesand

procedures no lessthan annually and update them asappropriate to ensure theircontinued

effectiveness,taking into accountrelevantdevelopm entsin the field and evolving international and industry standards.

ProperOversightand lndependence The Company w illassign responsibility to oneorm ore seniorcorporate

executivesofthe Com pany forthe im plem entation and oversightofthe Com pany'santi-

corruptioncompliancecode,policies,andprocedures.Suchcorporateofficialts)shallhavethe authority to reportdirectly to independentm onitoring bodies,including internalaudit the Com pany'sBoard ofDirectors,orany appropriatecom mittee ofthe Board ofD irectors,and

shallhavean adequate levelofautonomy from m anagem entasw ellassufficientresourcesand authority to m aintain such autonom y.

Training and Guidance 8.

The Com pany w illim plem entm echanism sdesigned to ensure thatitsanti-

corruption com pliance code,policies,and procedures are effectively com m unicated to all directors,oficers,em ployees,and,where necessary and appropriate,agentsand business

partners.Thesemechanismsshallinclude:(a)periodictrainingforalldirectorsandofficers,all employeesinpositionsofleadership ortrust,positionsthatrequiresuch training (e.g.,internal audit,sales,Iegal,compliance,finance),orpositionsthatotherwiseposeacom zption risk to the

Company,and,wherenecessaryandappropriate,agentsandbusinesspartners;and(b) C-4

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corresponding certificationsby allsuch directors,officers,em ployees,agents,and business partners,certifying com pliance w ith the training requirem ents.

9.

The Com pany w illm ainl in,orwhere necessary establish,an effective system

forproviding guidance and advice to directors,officers,employees,and,where necessary and appropriate,agentsand businesspartners,on com plying w ith the Com pany'santi-corruption com pliance code,policies,and procedures,including when they need advice on an urgentbasis

orinanyforeignjurisdictioninwhichtheCompanyoperates.

InternalReporting and lnvestigation l0.

The Com pany w illm aintain,orwhere necessary establish,an effective system

forintelmaland,where possiblesconfidentialreporting by,and protection of,directors,officers, employees,and,where appropriate,agentsand businesspartnersconcerning violations ofthe anti-corruption law sorthe Com pany'santi-corruption com pliance code,policies,and procedures.

1l.

The Company w illm aintain,orwhere necessary establish,an effective and

reliable processw ith sufficientresources forresponding to,investigating.and docum enting allegationsofviolationsofthe anti-corruption law sorthe Com pany'santi-รงorruption compliance code,policies,and procedures.

EnforcementandDisclpline 12.

The Company willim plem entm echanism sdesigned to effectively enforce its

compliance code,policies,and procedures,including appropriately incentivizing com pliance and disciplining violations.

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13.

The Com pany willinstitute appropriate disciplinary proceduresto address,

am ong otherthings,violationsofthe anti-conuption law sand the Com pany'santi-corruption compliance code,policies,and proceduresby the Company's directors, officers,and em ployees.

Such proceduresshould beapplied consistently and fairly,regardlessofthe position held by, or perceived im portance of,the director,officer,oremployee. The Com pany shallimplem ent proceduresto ensure thatwhere m isconductisdiscovered,reasonable stepsaretaken to rem edy

the harm resulting from such m isconduct,and to ensure thatappropriate stcps are taken to preventfurthersim ilarm iscènduct,including assessing the internalcontrols,com pliance code, policies,and proceduresand m aking m odificationsnecessary to ensure the overallanticorruption com pliance program iseffective.

Third-party Relationships l4.

The Com pany w illinstitute appropriate risk-based due diligencç and com pliance

requirem entspertaining to the retention and oversightofa1lagentsand businesspartners, including' . a.

properly docum ented due diligencepertaining to the hiring and

appropriate and regularoversightofagentsand businesspartners; b.

inform ing agents and businesspartners ofthe Com pany'scom m itm entto

abiding by anti-corruption laws,and ofthe Com pany'santi-corruption com pliance code, policies,and procedures;and seeking a reciprocalcom m itm entfrom agentsand businesspartners.

W here necessary and appropriate,the Com pany w illinclude su ndard provisions in agreem ents,contracts,and renew alsthereofw ith allagents and businesspartnersthatare C-6

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reasonably calculated to preventviolationsofthe anti-corruption law s,w hich m ay, depending

uponthecircumstances,include:(a)anti-corruptionrepresentationsandundertakingsrelatingto compliancewiththeanti-corruptionlaws;(b)rightstoconductauditsofthebooksandrecordsof theagentorbusinesspartnerto ensurecompliancewiththeforegoing;and (c)rightsto terminate an agentorbusinesspartnerasa resultofany breach ofthe anti-corruption law s,the Com pany's com pliance code,policies,orprocedures,orthe representations and undertakingsrelated to such m atters.

M ergers and Acquisitions

l6.

The Com pany w illdevelop and im plem entpoliciesand proceduresform ergers

and acquisitionsrequiring thatthe Company conductappropriate risk-based due diligence on potentialnew businessentities,including appropriate FCPA and anti-corruption due diligence by legal,accounting,and com pliance personnel.

17.

The Company w illensure thatthe Company's compliance code,policies,and

proceduresregarding the anti-corruption Iawsapply as quickly asispracticable to new ly acquired businessesorentitiesm erged w ith the Com pany and w illprom ptly:

a.

train the directors,officers,em ployees,agents,and businesspartners

consistentw ith Paragraph 8 above on the anti-corruption laws and the Com pany'scom pliance code,policies,and proceduresregarding anti-corruption law s;and b.

where w arranted,conductan FcpA -specific auditofa1lnew ly acquired

orm erged businessesasquickly aspracticable.

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M onitoring and Testing

18.

The Com pany w illconductperiodic reviews and testing ofitsanti-corruption

com pliance code,policies,and proceduresdesigned to evaluate and improve theireffectiveness in preventing and detecting violationsofanti-corruption law sand the Com pany'santi-corruption

code,policies,and piocedures,lking into accountrelevantdevelopm ents in the field and evolving internationaland industry standards.

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A TTA CH M EN T D IN DEPEN DENT CO M PLIA NC E M O N ITO R

ThedutiesandauthorityoftheIndependentComplianceM onitor(theEtM onitor''),and

theobligĂ lionjA LATAM AirliizesGroup S.A.tthettcompan/),onbehalfofitselfandits subsidiariesandaffiliates,withrespecttotheMonitorandtheDepartmentofJustice(the tr epartment'')5areasdescribedbelow: TheCom pany w illretain theM onitorfora period ofnotlessthan tw enty-seven '

(27)months(thetĂť-rerm oftheMonitorship''),unlesstheearlyterminationprovisionsof

Paragraph3oftheDeferredProsecutionAgreement(thettAgreemenf')aretriggered.Subjectto certain conditions specified below thatw ould,in the sole discretion ofthe D epartm ent,allow for

an extension ofthe Term oftheM onitorship,the M onitorshallbe retained untilthe criteria in Paragraphs 19-20 below are satisfied orthe Agreem entexpires,whicheveroccursfirst.

M onitor' s M andate

TheM onitor'sprim ary responsibility isto assessand monitorthe Com pany's

compliance w ith theterm s ofthe Agreem ent,including the Corporate Com pliance Program in AttachmentC,so asto specifically address and reduce the risk ofany recurrence ofthe Com pany'sm isconduct. D uring the Term ofthe M onitorship,theM onitorw illevaluatesin the

m annersetforth below ,the effectivenessofthe internalaccounting controls,record-keeping,and snancialreporting policiesand proceduresofthe Company asthey relate to the Com pany's currentand ongoing compliancew ith the FCPA and otherapplicable anti-corruption law s

(collectively,thettanti-corruption laws'')and take suchreasonablestepsas,in hisorherview, -

may be necessary to fulfilltheforegoing mandate(thettM andate''). ThisM andate shallinclude an assessm entofthe Board ofD irectors'and seniorm anagem ent'scom m itm entto,and effective

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im plem entation bf,the corporate com plianceprogram described in A ttachmentC ofthe A greem ent.

Company '. çObligations The Com pany shallcôoperate fully w ith the M onitor, and the M onitorshallhave the authority to take such reasonable stepsas, in hisorherview ,m ay be necessary to be fully

inform ed aboutthe Com pany's com pliance program in accordance w ith theprinciples setforth herein and applicable law ,including applicable data protection and laborlaw s and regulations.

To thatend,the Com pany shall:facilitate the M onitor'saccessto the Com pany'sdocum entsand resources;notIim itsuch access,exceptasprovided in Paragraphs 5-6)and provide guidance on

applicablelocallaw (suchasrelevantdataprotectionandlaborlaws).TheCompanyshall provide theM onitorw ith accessto allinform ation,documents, records,facilities,and employees,as reasonably requested by the M onitor,thatfallw ithin the scope ofthe M andate of the M onitorunderthe A greem ent.The Com pany shalluse its besteffortsto provide the M onitor w ith accessto the Com pany'sform erem ployees and itsthird-party vendors, agents,and consultants.

4.

Any disclosure by the Com pany to the M onitorconcerning corruptpaym ents,

false booksand records,and internalaccounting controlfailures shallnotrelieve the Company of any otherwise applicable obligation to truthfully disclose such m attersto the Departm ent, pursuantto the Agreem ent.

W ithholding Access 5.

The partiesagree thatno attorney-clientrelationship shallbe form ed betw een the

Company and the M onitor. ln the eventthatthe Com pany seeksto w ithhold from the M onitor accessto infonmation,documents,records,facilities,orcurrentorform erem ployees ofthe

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Companythatmaybesubjecttoaclaim ofattorney-clientprivilegeortotheattorneyworkproductdoctrine,orw herethe Com pany reasonably believesproduction would otherw ise be inconsistentwith applicable law,the Company shallwork cooperatively w ith theM onitorto

resolvethe m atter'to the satisfaction ofthe M oflitor.

6.

lfthe m attercannotbe resolved, atthe requestofthe M onitor,th< Com pany shall

prom ptly provide written notice to the M onitorand the Departm ent. Such notice shallinclude a generaldescription ofthe nature ofthe inform ation, documents,records,facilitiesorcurrentor form eremployeesthatare being w ithheld,asw ellasthe legalbasis forw ithholding access. The D epartm entmay then considerw hetherto make a furtherrequestforaccess to such inform ation, docum ents,records,facilities,orem ployees.

M onitor' s Coordination with the Company and Review M ethodology ln carrying outthe M andate,to the extentappropriateunderthe circum stances,

the M onitorshould coordinate w ith Com pany personnel,including in-house counsel, compliance personnel,and internalauditors,on an ongoing basis. The M onitorm ay rely on the productof

the Com pany'sprocesses,such as the results ofstudies,review s,sampling and testing m ethodologies,audits,and analyses conducted by oron behalfofthe Company,aswellasthe

Company'sinternalresources(e.g.,legal,compliance,andinternalaudit),whichcanassistthe M onitor in carrying outthe M andate through increased efficiency and Com pany-specific expertise,provided thatthe M onitorhasconfidence in the quality ofthose resources.

8.

The M onitor's reviews should use a risk-based approach,and thus,the M onitoris

notexpected to conducta com pTehensive review ofallbusinesslines,allbusinessactivities,or

allm arkets. In carrying outthe M andate,the M onitorshould consider,forinstance,risks

presentedby:(a)thecountriesand industriesinwhichtheCompanyoperates;(b)currentand D-3

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futurebusinessopportunitiesandtransactions' ,(c)currentandpotentialbusinesspartners,

includingthirdpartiesandjointventures,andthebusinessrationaleforsuchrelationships;(d) theCompany'sgifts,travel,and entertainmentinteractionswith foreignofficials;and (e)the Com pany'sinkolvem entwith foreign officials,including the am ountofforeign governm ent

regulation and oversightofthe Com pany,such as licensing and perm itting,and the Com pany's exposure to custom sand im m igration issues in conducting itsbusinessaffairs.

9.

ln undertaking the review sto carry outthe M andate,the M onitorshallform ulate

conclusionsbasedon,amongotherthings:(a)inspectionofrelevantdocuments,includingthe Company'scurrentanti-conuptionpoliciesandprocedures;(b)on-siteobservationofselected system sand proceduresofthe Com pany atsam ple sites,including internalaccounting controls,

record-keeping,andinternalauditprocedures' ,(c)meetingswith,andinterviewsof,relevant currentand,where appropriate,fonnerdirectors,officers,em ployees,businesspartners,agents,

andotherpersonsatmutually convenienttimesandplaces;and (d)analyses,studies,and testing ofthe Com pany'scom pliance program .

M onitor's W ritten W ork Plans To can'y outthe M andate,during the Term ofthe M onitorship,the M onitorshall conductan initialreview and prepare an initialreport,followed by atleasttwo follow -up reviews and reportsasdescribed in Paragraphs 16-18 below . W ith respectto the initialreport,after consultation w ith the Com pany and the D epartm ent,the M onitorshallprepare the firstwritten

workplanwithinforty-five(45)calendardaysofbeingretained,andtheCompanyandthe Departmentshallprovidecommentswithin twentpfive(25)calendardaysafterreceiptofthe written w ork plan. W ith respectto each follow-up report,afterconsultation w ith the Company

andtheDepartment,theMonitorshallprepareawrittenworkplanatleastthirty(30)calendar

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dĂ yspriorto com m encing a review , and the Com pany and the Departm entshall'provide

commentswithinfifteen(15)calendardaysafterreceiptofthewrittenworkplan A ny disputes .

between the Com pany and theM onitorw ith respectto any w ritlen work plan shallbe decided by theD epartm entin its sole discretion.

1l.

A llwritten work plansshallidentify w ith reasonable specificity the activitiesthe

M onitorplansto undertake in execution ofthe M andate, including a written requestfor docum ents. The M onitor'sw ork plan forthe initialreview shallinclude such stepsasare reasonably necessary to conductan effective initialreview in accordance w ith the M andate, including by developing an understanding, to the extenttheM onitordeem s appropriate, ofthe factsand circum stances surrounding any violationsthatm ay have occurred before the date ofthe Agreement. ln developing such understanding the M onitoristo rely to the extentpossible on available infonnation and docum entsprovided by the Com pany. ltisnotintended thatthe

M onitorwillconducthis orherown inquiry into the historicaleventsthatgave rise to the A greem ent.

InitialReview

12.

Theinitialreview shallcom mence no laterthanninety (90)calendardaysfrom

thedateoftheengagementoftheMonitor(unlessotherwiseagreedbytheCompany,the M onitor,andtheDepartment). TheM onitorshallissueawritten reportwithinonehundred fifty

(150)calendardaysofcommencingtheinitialreview,setting forththeMonitor'sassessment and,ifnecessary,m aking recom m endationsreasonably designed to im prove the effectivenessof the Com pany'sprogram forensuring com pliance w ith the anti-corruption law s. The M onitor should consultw ith the Company concerning his orhertindingsand recom m endationson an

ongoingbasisand should considertheCompany'scommentsand inputtotheextenttheM onitor

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deems appropriate. The M onitorm ay also chooke to shĂ re a draftofhisorherreportsw itlzthe Com pany and the D epartm entpriorto finalizing them . The M onitor's reportsneed notrecite or

describe com prehensively the Company'shistory orcompliancepolicies, procedures and practices,butratherm ay focuson thoseareaswith respectto w hich the M onitorw isbes to m ake

recom m endations,ifany,forim provem entorwhich the M onitorotherwise concludesm erit particularattention. The M onitorshallprovide the reportto the Board ofD irectorsofthe Com pany and contem poraneously transm itcopiesto the Chief- FCPA U nit, Fraud Section, Crim inalD ivision,U .S.Departm entofJustice,at 1400 N ew Y ork Avenue N .W .,Bond Building, Eleventh Floor,W ashington,D .C.20005. A fterconsultation w ith the Com pany, the M onitor

may extend the tim e period forissuance ofthe initialreportfora briefperiod oftim e w ith prior written approvalofthe Departm ent.

13.

Withinninety(90)calendardaysafterreceivingtheMonitor'sinitialreport,the

Com pany shalladoptand im plem entallrecom m endations in thereport,unless,w ithin Gt-teen

(15)calendardaysofreceivingthereport,theCompany notifiesinwriting theM onitorand the Departm entofany recom m endationsthattheCom pany considersunduly burdensom e, inconsistentw ith applicable law orregulation,im practical,excessively expensive,orotherw ise inadvisable. W ith respectto any such recom m endation,the Com pany need notadoptthat

recommendationwithin theninety (90)calendardaysofreceiving thereportbutshallpropose in writing to theM onitorand the Departm entan alternative policy,procedure,orsystem designed

toachievethesameobjectiveorpumose.AstoanyrecommendationonwhichtheCompany and the M onitordo notagree,such partiesshallattemptin good faith to reach an agreem ent

withinGfteen (15)calendardaysaftertheCompany servesthewrittennotice.

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In the evèntthe Company and the M onitorare unable to agree on an acceptabld alternativeproposal, the Company shallprom ptly consultw ith the Departm ent. The D epartm ent

m ay considertheM onitor's recomm endation and the Com pany'sreasons fornotadopting the recom m endation in determ ining whetherthe Com pany hasfully com plied w ith itsobligations underthe Agreem ent. Pending such determ ination, the Com pany shallnotbe required to

implementanycontested recommendationts).

W ith respectto any recom m endation thatthe M onitordeterm ines cannot

reasonably beimplemented withinninety (90)calendardaysafterreceiving thereport, the M onitorm ay extend the tim e period forim plem entation w ith priorw ritten approvalofthe D epartm ent.

FirstFollow-up Review

Thefsrstfollow-up review shallcommenceno laterthan ninety (90)calendardays afterthe issuanceoftheinitialreport(unlessotherwiseagreed by theCompany, the M onitorand

theDepartment).TheMonitorshallissueawrittenfollow-upreportwithinonehundredtwenty (120)calendardaysofcommencingthefirstfollow-upreview,settingforththeMonitor's assessm entand,ifnecessary,m aking recom m endationsin the sam e fashion assetforth in Paragraph 12 w ith respectto the initialreview . The M onitorshallalso certify whetherthe

Com pany'scompliance program ,including itspoliciesand procedures, isreasonably designed and im plem ented to preventand detectviolationsofthe anti-corruption law s. A fterconsultation w ith the Com pany,the M onitorm ay extend thetim e period forissuance ofthe firstfollow-up reportfora briefperiod oftim e with priorw ritten approvalofthe D epartm ent.

W ithin ninety (90)calendardaysafterreceiving theM onitor'sfirstfollow-up report,the Com pany shalladoptand im plem entallrecom m endations in the report, unless,w ithin

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fifteen(15)calendardaysafterreceivingthereport,theCompanynotifiesinwritingtheM onitor and the D epartm entconcerning any recom m endationsthatthe Com pany considersunduly

burdensom e,inconsistentw ith applicable law orregulations im practical,excessively expensive

,

orotherwise inadvisable. W ith respectto any such recom mendation, the Com pany need not

adoptthatrecommendationwithintheninety(90)calendardaysofreceivingthereportbutshall propose in writing to the M onitorand the Departmentan alternative policy, procedure,orsystem

designedtoachievethesameobjectiveorpurpose.Astoanyrecommendationonwhichthe Com pany and theM onitordo notagree, such partiesshallattemptin good faith to reach an

agreementwithinfifteen(15)calendardaysaftertheCompanyservesthewrittennotice

.

l8.

In the eventthe Com pany and the M onitorare unable to agree on an acceptable

alternativeproposal,the Company shallprom ptly consultw ith the Departm ent. The Department

m ay considèrthe M onitor's recom m endation and the Com pany'sreasonsfornotadopting the recom m endation in determ ining whetherthe Com pany hasfully complied w ith itsobligations underthe A greem ent. Pending such determ ination, the Company shallnotberequired to

implementanycontestedrecommendationts).

Second Follow -up Review

Thesecondfollow-upreview shallcommencenolaterthanninety(90)calendar daysaftertheissuanceofthefirstfollow-up report(unlessotherwiseagreed by theCom pany, the

M onitorandtheDepartment).TheM onitorshallissueawrittensecondfollow-upreportwithin onehundredtwenty(120)calendardaysofcommencingthesecondfollow-upreview, setting forth the M onitor'sassessm entand, ifnecessary,m aking recom m endations in the sam e fashion

assetforth in Paragraph 12 with respectto the initialreview . The M onitorshallalso certify whetherthe Company'scom pliance program , including itspoliciesand procedures, isreasonably

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designed and im plem ented to preventand detectviolationsoftlze anti- corruption Iaw s. After consultation w ith the Com pany,the M onitorm ay extend the tim eperiod forissuance ofthe follow -up reportfora briefperiod oftim e w ith priorw ritten approvalofthe D epartm ent.

W ithinninety(90)calendardaysafterreceivingtheMonitor'ssecondfollow-up report,theCompany shalladoptand implementallrecommendationsin thereporq unless, w ithin

Gfteen(15)calendardaysafterreceivingthereport,theCompanynotifiesinwritingtheMonitor and the Departm entconcerning any recom mendationsthatthe Company considersunduly

burdensom e,inconsistentw ith applicable Iaw orregulation, im practical,excessively expensive, orotherwise inadvisable. W ith respectto any such recom m รงndation, the Company need not

adoptthatrecom mendationwithin theninety (90)calendardaysofreceiving thereportbutshall propose in writing to the M onitorand the D epartm entan alternative policy, procedure,orsystem

designedtoachievethesameobjectiveorpurpose.Astoanyrecommendationonwhichthe Com pany and the M onitordo notagree, such parties shallattem ptin good faith to reach an

agreementwithinfifteen(15)calendardaysaftertheCompany servesthewrittennotice .

18.

ln the eventthe Com pany and the M onitorare unable to agree on an acceptable

alternative proposal,the Com pany shallpromptly consultw ith the Departm ent. The D epartm ent m ay considerthe M onitor'srecom m endation and the Com pany'sreasonsfornotadopting the

recom m endation in determ ining whetherthe Com pany hasfully com plied w ith itsobligations underthe Agreem ent. Pending such determ ination, the Com pany shallnotbe required to

implementany contested recommendationts).

Certscationofcompliance and TerminationoftheMonitorshi p l9. Attheconclusion oftheninety (90)calendarday periodfollowing the issuanceof the second follow -up reporq ifthe M onitorbelievesthatthe Com pany'scom pliance program is D-9

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reasonablfdesignedandimplementedtodetectandpreventviolationsoftheanticorrup-tioh law s -

and isfunctioning effectively, the M onitorshallcertify the Com pany'scom pliance w ith its com pliance obligationsunderthe Agreem ent. The M onitorshallthen subm itto the D epal-tm ent

awrittenreportCĂšcertificationRepolf')withinsixty(60)calendardays The Certification .

Reportshallsetforth an overview ofthe Company'srem ediation effortsto date including the ,

im plem entation status ofthe M onitor'srecom m endations, and an assessm entofthe sustainability ofthe Com pany'srem ediation efforts. The Certification Reportshould also recom mend the

scope ofthe Com pany'sfuture self-reporting. Also attheconclusion ofthe ninety (90)calendar day period follow ing the issuanceofthe second follow - up report,the Com pany shallcertify in writing to the D epartm ent, w ith a copy to the M onitor, thatthe Company has adopted and implem ented al1ofthe M onitor'srecom m endationsin the initialand follow -

upreportts),orthe

agreed-upon alternatives. The M onitororthe Company m ay extend the tim e period for issuance ofthe Certification Reportorthe Company'scertification, respectively,with priorw ritten

approvalofthe Departm ent.

20.

Atsuch tim e astheD epartm entapprovesthe Certification Reportand the

Company'scertification, the m onitorship shallbe term inated, and the Com pany w illbeperm itted

to self-reportto the Departm enton its enhanced com pliance obligations forthe rem ainderofthe term ofthe Agreem ent. The Departm ent, however,reserves the rightto term inate the

m onitorship absentcertification by theM onitor, upon a show ing by the Com pany that term ination is,nevertheless, intheinterestsofjustice.

21.

Ifperm itted to self-reportto the D epartment, the Com pany shallthereaftersubm it

totheDepartmentawrittenreporteveryfour(4)monthssettingforthacompletedescriptionof itsrem ediation effortsto date, itsproposalsto im prove the Com pany's. internalaccounting

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controls,policies,and proceduresforensuring coinpliance-W ith the anti-corruption law s, and the proposed scope ofthe subsequentreviews. The reportshallbetransm itted to the Chief- FCPA Unit,Fraud Section,Crim inalD ivision,U .S.Departm entofJustice,1400 N ew Y ork Avenue, N .W .,Bbnd Building,Eleventh Floor,W ashington, D .C.20005. The Com pany nĂŻay ĂŠxtend the

tim e period forissuance ofthe self-reportw ith priorw ritten approvalofthe D epartm ent.

ExtensionoftheTerm oftheMonitorshlp If,however,attheconclusionoftheninety(90)calendar-dayperiodfollowingthe issuance ofthe second follow -up reporq the D epartm entconcludesthatthe Com pany hasnotby thattim e successfully satistsed itscom pliance obligationsundertheA greem ent, the Term ofthe M onitorship shallbe extended forone year.

23.

Undersuch circum stances,the M onitorshallcom m ence the third follow-up

review no laterthan sixty (60)calendardaysaftertheDepartmentconcludesthattheCompany hasnotsuccessfully satisfieditscomplianceobligationsundertheAgreement(unlessotherwise

agreedbytheCompany,theM onitor,andtheDepartment).TheMonitorshallissueawritten follow-upreportwithinonehundredtwenty(120)calendardaysofcommencingthethird follow -up review in the sam e fashion assetforth in Paragraph 12 w ith respectto the initial review and in accordance w ith theproceduresforfollow -up reportssetforth in Paragraphs l6--

18. A determ ination to term inate the m onitorship shallthen be m ade in accordance w ith Paragraphs 19-20.

1f,aftercompleting thethird follow -up review ,the D epartm entagain concludes thatthe Com pany hasnotsuccessfully satisfied its obligations underthe A greem entw ith respect to the M onitor'sM andate,the Term ofthe M onitorship shallbe extended untilexpiration ofthe

Agreement,and theM onitorshallcommenceafourth follow-up review withinsixty (60)

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calendardaysafter'thè'Depàrtinentconcludesthatthe Com pany hasnotsuccessfully satisfied its

complianceobligationsundertheAgreement(unlessotherwiseagreedbytheCompany, the M onitor,andtheDepartment).TheMonitorshallissueawrittenfollow-upreportwithinone htmdtedtwenty(l20)calendardaysofcommencingthèthird follow-upreview inthesame fashion assetforth in Paragraph 12 w ith respectto the initialreview and in accordance with the procedures forfollow -up reports setforth in Paragraphs 16-18. .

Monitor' sDiscoveryofMisconduct 25.

Should the M onitor, during the course ofhisor herengagem ent, discoverthat:

corruptorotherwisesuspiciouspayments(ortransfersofpropertyor

interests)mayhavebeenoffered,promised,made,orauthorizedbyany entity orperson w ithin the Com pany orany entity orperson w orking, directly orindirectly, fororon behalfofthe Com pany;or *

false booksand recordsm ay have been m aintained by the Com pany

either(a)afterthedateonwhichthisAgreementwassignedor(b)thathavenotbeenadequately dealtwithbytheCompany(collectively:limproperactivities''), the M onitorshallprom ptly reportsuch im properactivitiesto the Com pany'sGeneralCounsel, ChiefCom pliance O fficer, and/orA uditCom m ittee forfurtheraction. lfthe M onitorbelievesthatany im properactivities m ay qonstitute a violation ofIaw , the M onitoralso shallreportsuch im properactivitiesto the D epartm ent. The M onitorshould disclose improperactivitiesin hisorherdiscretion directly to

the Departm ent,and notto the Com pany, only ifthe M onitorbelievesthatdisclosure to the Company w ould be inappropriateunderthe circum stances, and in such case should disclose the im properactivities to the GeneralCounsel, ChiefCom pliance O fficer, and/orthe Audit Com m ittee ofthe Company asprom ptly and com pletely asthe M onitordeem sappropriate under

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the circum stances. The M onitorshalladdressin his orherreportsthe appropriatenessofthe

Com pany's response to allimproperactivities, w hetherpreviously disclosed to the Department ornot. Further,in the eventthatthe Company, orany entity orperson working directly or indirectly fororon behalfofthe Com pany, w ithholdsinformation necessary forthe perform ance ofthe M onitor'sresponsibilities, iftheMonitorbelievesthatsuchwi thholdingiswithoutjust cause,the M onitorshalldisclose thatfactto the D epartm ent. The Com pany shallnotG ke any action to retaliate againstthe M onitorforany such disclosures orforany otherreason. The M onitorshallreportm aterialcriminalorregulatory violationsby the Com pany orany other entity discovered in the course ofperfonning his orherduties, in the sam e mannerasdescribed above.

MeetingsDuringPendencyofMonitorshlp 26. TheMonitorshallmeetwiththeDepartmentwithinthirty(30)calendardaysafter providing each reportto the Departm entto discuss the report, to be followed by a m eeting between theD epartm ent,the M onitor, and the Company.

27.

Atleastannually,and m ore frequently ifappropriate, representativesfrom the

Company and theD epartm entw illm eettogetherto discussthe m onitorship and any suggestions, com m ents,orimprovem entsthe Com pany m ay w ish to discussw ith orproposeto the

Departm ent,including w ith respectto the scope orcostsofthe m onitorship.

ContemplatedConfdentialityt?fMonitor' sReports 28.

The reportsw illlikely include proprietary, snancial,confidential,and com petitive

businessinform ation. M oreover, public disclosure ofthe reportscould discourage cooperation,

orimpedependingorpotentialgovernmentinvestigationsandthusunderminetheobjectivesof the m onitorship. Forthese reasons, among others,the reportsand the contentsthereofare

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intended to rem ain and shallrem ain non-public, exceptasotherwise agreed to by the partiesin w riting,orexceptto the extentthatthe Departm entdeterm inesin its sole discretion that disclosure would be in furtherance ofthe D epartm ent'sdischarge ofitsdutiesand responsibilities oris otherwiserequired by law .

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