Fagan Transcript

74
,QWUR ,QGH[ 7KH 3ODQ DJDLQVW WKH 1:2 /7$& 5HFHQW 3RVWV &RQWDFW 7&7$ )RUXP 7KH ,OOXPLQDWL DQG WKH &RXQFLO RQ )RUHLJQ 5HODWLRQV 6XEPLWWHG E\ F\EH RQ 0D\ %\ 0<521 & )$*$1 $ 7UDQVFULSW 0\URQ )DJDQ UHFRUGHG KLV H[SRVp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

Transcript of Fagan Transcript

Page 1: Fagan Transcript

,QWUR � ,QGH[ � 7KH�3ODQ�DJDLQVW�WKH�1:2 � /7$& � 5HFHQW�3RVWV � &RQWDFW � 7&7$��)RUXP�

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ)RUHLJQ�5HODWLRQV

6XEPLWWHG�E\�F\EH�RQ�0D\�����������������

%\�0<521�&��)$*$1

�$�7UDQVFULSW�

0\URQ�)DJDQ�UHFRUGHG�KLV�H[SRVp�RQ�WKH�,OOXPLQDWL�DQG

&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�LQ�WKH�ODWH�����V�RQ�WKUHH

/3�5HFRUGV��+HUH�LV�KLV�OHFWXUH�LQ�VL[�SDUWV�UHSUHVHQWLQJ

HDFK�VLGH�RI�WKRVH�5HFRUGV�LQ�03��DXGLR�IRUPDW�

1HZ�YHUVLRQ�ZKLFK�KDV�KDG�VRPH�RI�WKH�QRLVH

ILOWHUHG�RXW�

03��$XGLR�)LOH �03��6WUHDP����NE�VHF�

�RU�GRZQORDG�WKH�03��ILOH�WR�\RXU�FRPSXWHU����0E��

2OGHU�YHUVLRQV��VPDOOHU��OHVV�TXDOLW\�

03��$XGLR�)LOH 03��6WUHDP�DOO�VL[�SDUWV����NE�VHF�

�RU�GRZQORDG�LQGLYLGXDO�03��ILOHV�������������������

���

$%287�7+(�63($.(5��

�:+26�:+2�,1�7+(�7+($7(5��KDV�DOZD\V�EHHQ�WKH�%LEOH

RI�WKH�3HRSOH�LQ�WKH�/HJLWLPDWH�7KHDWHU��,W�QHYHU�SOD\HG

:H�DUH�SHUIRUPLQJPDLQWHQDQFH�RQ�WKH�VLWH�VRHYHU\WKLQJ�PLJKW�QRW�EHZRUNLQJ�SHUIHFWO\�

8VHU�ORJLQ

/RJ�LQ�XVLQJ�2SHQ,'�

:KDW�LV�2SHQ,'"

8VHUQDPH��

3DVVZRUG��

/RJ�LQ

&UHDWH�QHZ�DFFRXQW

5HTXHVW�QHZ�SDVVZRUG

6HDUFK

���� 6HDUFK

�������FRP�

�������FRP��*RRJOH��

$�VHOHFWLRQ�RI�VLWHV �

0XOWLPHGLD�5HVRXUFHV�&RQVSLUDF\�&HQWUDO�

-DKWUXWK�QHW�

0(5/LE�RUJ�

'LFWLRQDU\�

1DYLJDWLRQ

*ORVVDU\5HFHQW�SRVWV

&DWHJRULHV

��1HZ�:RUOG�2UGHU�>O@���$JHQFLHV��&RPPLVVLRQV���>O@����7KH�81�>O@���-HZU\���,VUDHO���=LRQLVP���>O@���7KH�0LGGOH�(DVW���6HFUHW�6RFLHWLHV�>O@����,OOXPLQDWL�>O@ �6NXOO�DQG�%RQHV

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

��RI��� ���������������30

Page 2: Fagan Transcript

)DYRULWHV��LW�WROG�QR�OLHV��LW�*ORULILHG�QRERG\��,W�DOZD\V�ZDV

DQ�XQELDVHG�+,6725<�RI�WKH�PHQ�DQG�ZRPHQ�LQ�WKH

7KHDWHU��,W�UHFRUGHG�RQO\�WKRVH�ZKR�SURYHG�WKHLU�ZRUWK�LQ

WKH�RQH���$1'�21/<�21(���WHVWLQJ�SODFH�RI�WKH�7KHDWHU�

%52$':$<��7KDW��:+26�:+2��UHFRUGV�WKH�SOD\V�0\URQ

&��)DJDQ�ZURWH��GLUHFWHG�DQG�SURGXFHG�����'UDPDV�

&RPHGLHV��0HORGUDPDV��0\VWHULHV��$OOHJRULHV��)DUFHV��

PDQ\�RI�WKHP�WKH�PRVW�UHVRXQGLQJ��+,76��RI�WKHLU�\HDUV�

+H�DUULYHG�RQ�%URDGZD\�LQ����������\HDUV�ROG��WKH

\RXQJHVW�SOD\ZULJKW�LQ�WKH�KLVWRU\�RI�WKH�$PHULFDQ

7KHDWHU��,Q�WKH�IROORZLQJ�\HDUV�KH�ZURWH�DQG�GLUHFWHG

SOD\V�IRU�PDQ\�RI�WKH�*5($76�RI�WKRVH�GD\V�����0UV��/HVOLH

&DUWHU��:LOWRQ�/DFND\H��)ULW]�/HLEHU��$OOD�1D]LPRYD��-DFN

%DUU\PRUH��'RXJODV�)DLUEDQNV��6U���(�+��6RXWKHUQ��-XOLD

0DUORZH��+HOHQ�0RUJDQ��HWF��HWF��+H�GLUHFWHG�&KDUOHV�0�

)URKPDQ��%HODVFR��+HQU\�:��6DYDJH��/HH�6KXEHUW��$EH

(UODQJHU��*HRUJH�0��&RKDQ��HWF��HWF���,Q�WKH���\HDUV

EHWZHHQ������DQG������KH�ZURWH��SHUVRQDOO\�GLUHFWHG�

DQG�SURGXFHG�WZHOYH�SOD\V���7+(�:+,7(�526(����7+80%6

'2:1����7:2�675$1*(56�)520�12:+(5(��

�0,60$7(6����7+(�)$6&,1$7,1*�'(9,/����7+(�/,77/(

63,7),5(����-,00<6�:20(1����7+(�*5($7�32:(5��

�,1',6&5(7,21����1$1&<6�35,9$7(�$))$,5����60$57

:20$1���DQG��3(7(5�)/,(6�+,*+��

'XULQJ�KLV�HDUO\�\HDUV��0U��)DJDQ�ZDV�DOVR��'UDPDWLF

(GLWRU��IRU��7KH�$VVRFLDWHG�1HZVSDSHUV���LQFOXGLQJ�WKH

�1HZ�<RUN�*OREH��DQG�YDULRXV�+HDUVW�QHZVSDSHUV��%XW�LQ

�����KH�WRRN�D��6$%%$7,&$/��IURP�WKH�7KHDWHU�DQG

VHUYHG�DV��'LUHFWRU�RI�3XEOLF�5HODWLRQV��IRU�&KDUOHV�(YHQV

+XJKHV��WKH�5HSXEOLFDQ�&DQGLGDWH�IRU�WKH�3UHVLGHQF\���KH

UHIXVHG�D�VLPLODU�SRVW�RIIHUHG�KLP�IRU�WKH�+RRYHU

FDPSDLJQ�LQ�������WKXV��0U��)DJDQV�FDUHHU�HQFRPSDVVHG

WKH�7KHDWHU��-RXUQDOLVP�DQG�1DWLRQDO�3ROLWLFV��DQG�KH�LV�D

SURYHQ�H[SHUW�LQ�DOO�WKRVH�ILHOGV�

,Q�������0U��)DJDQ�FDPH�WR�+ROO\ZRRG�ZKHUH�KH�VHUYHG

DV��:ULWHU�'LUHFWRU��ZLWK��3DWKH�3LFWXUHV��,QF����WKHQ

RZQHG�E\�-RVHSK�3��.HQQHG\��IDWKHU�RI�WKH�ODWH�3UHVLGHQW

-DFN�.HQQHG\��DQG�DOVR�DW���WK�&HQWXU\�)R[��DQG�RWKHU

+ROO\ZRRG�)LOP�6WXGLRV��%XW�KH�DOVR�FRQWLQXHG�LQ�WKH

%URDGZD\�/HJLWLPDWH�ILHOG�

,Q�������DW�WKH�XUJHQW�UHTXHVW�RI�-RKQ�7��)O\QQ��WKH

IDPRXV�DXWKRU�RI��7+(�5226(9(/7�0<7+����:+,/(�:(

6/(37����7+(�758(�6725<�2)�3($5/�+$5%25���HWF���0U�

)DJDQ�DWWHQGHG�D�PHHWLQJ�LQ�:DVKLQJWRQ�'�&��ZKHUH�KH

���7KH�9DWLFDQ�>O@��&RQWURO�>O@���%UDLQZDVKLQJ�>O@� 0.8/75$����'UXJV�>O@����)HPLQLVP�>O@����+RPRVH[XDOLW\�>O@���7HOHYLVLRQ�>O@��7KH�86$�>O@���-).�>O@��7KH�(8�>O@��&KLQD�>O@��)DNH�7HUURU�>O@�������>O@���/RQGRQ�����>�O@� 2NODKRPD���� 3HDUO�+DUERU���$UFKDHRORJ\��+LVWRU\�>O@���7KH�$UN�RI�7KH�&RYHQDQW>O@��%RRNV�>�O@��'LVDUPDPHQW�RI�WKH�SHRSOH>O@��(QYLURQPHQWDO�>O@���*HQHWLFDOO\�0RGLILHG����>O@��*RGV�/DZ�7RUDK�>O@��0DQPDGH�/DZ�>O@��$XGLR��9LGHR�>O@��0RQH\��%DQNLQJ��7KH�)HG�,0)�>O@��6FLHQFH��7HFKQRORJ\�>O@���(QHUJ\��2LO����>O@���0(5/LE�RUJ�>O@� 0LFURVRIW�(FKHORQ�>O@��6SLULWXDO�>O@��+HDOWK�>O@���$VSDUWDPH�>O@���&KHPWUDLOV�>O@���)OXRULGH�>O@���+,9���$,'6�>�O@���9DFFLQHV�>O@��)LQODQG���6XRPL�>O@��4XRWH�&ROOHFWLRQ

� �VHDUFK

>O@� �DOSKDEHWLFDO�OLVW

6XEVFULEH�WR�7KH�&DOO�7R�$UPV

HQWHU�HPDLO�DGGUHVV� 6XEVFULEH

7KH�21/<�VROXWLRQ�LV�WR�HQIRUFH

7KH�3ODQ�DJDLQVW�WKH�WUDLWRURXV

1��:��2��=LRQ�1D]L�PDVV�PXUGHU�

LQVLGH�MRE�SHUSHWUDWRUV�RI�2.&�

�����%DOL�����������DQG�WKH

SKRQH\�:DU�RQ�7HUURU�DQG

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

��RI��� ���������������30

Page 3: Fagan Transcript

ZDV�VKRZQ�D�VHW�RI�PLFUR�ILOPV�DQG�UHFRUGLQJV�RI�WKH

6(&5(7�PHHWLQJV�DW�<DOWD�DWWHQGHG�RQO\�E\�)UDQNOLQ

5RRVHYHOW��$OJHU�+HVV��+DUU\�+RSNLQV��6WDOLQ��0RORWRY��DQG

9LVKLQVN\�ZKHQ�WKH\�KDWFKHG�WKH�SORW�WR�GHOLYHU�WKH

%DONDQV��(DVWHUQ�(XURSH�DQG�%HUOLQ�WR�6WDOLQ��$V�D�UHVXOW

RI�WKDW�PHHWLQJ��0U��)DJDQ�ZURWH�WZR�SOD\V���5('

5$,1%2:���LQ�ZKLFK�KH�UHYHDOHG�WKDW�HQWLUH�SORW��DQG

�7+,(9(6�3$5$',6(���LQ�ZKLFK�KH�UHYHDOHG�KRZ�WKRVH

PHQ�SORWWHG�WR�FUHDWH�WKH��81,7('�1$7,216��WR�EH�WKH

�KRXVLQJ��IRU�D�VR�FDOOHG�&RPPXQLVW�2QH�:RUOG

*RYHUQPHQW��

$W�WKH�VDPH�WLPH��0U��)DJDQ�ODXQFKHG�D��21(�0$1�

FUXVDGH�WR�XQPDVN�WKH�5HG�&RQVSLUDF\�LQ�+ROO\ZRRG�WR

SURGXFH�ILOPV�WKDW�ZRXOG�DLG�WKDW��21(�:25/'

*29(510(17��SORW��2XW�RI�WKDW�FDPH�LQWR�EHLQJ�WKH

�&,1(0$�('8&$7,21$/�*8,/'���$V�D�UHVXOW�RI�WKH�ZRUN�RI

WKLV��&��(��*���RUJDQL]DWLRQ��KHDGHG�E\�0U��)DJDQ��LQ

�������FDPH�WKH�&RQJUHVVLRQDO�+HDULQJV�DW�ZKLFK�PRUH

WKDQ�����RI�+ROO\ZRRGV���DOVR�5DGLR�DQG�7�9���PRVW

IDPRXV�6WDUV��:ULWHUV��DQG�'LUHFWRUV�ZHUH�XQPDVNHG�DV

WKH�FKLHI�DFWLYLVW�RI�WKH�5HG�&RQVSLUDF\��7KDW�ZDV�ZKHQ

WKH�LQIDPRXV��+2//<:22'�7(1��ZHUH�VHQW�WR�SULVRQ�

,7�:$6�7+(�0267�6(16$7,21$/�(9(17�2)�7+$7

'(&$'(�

)URP�WKDW�WLPH�RQ�0U��)DJDQ�KDV�GHYRWHG�DOO�RI�KLV�WLPH

DQG�HIIRUWV�WR�ZULWLQJ�PRQWKO\��1(:6�%8//(7,16��IRU��&�

(��*���LQ�ZKLFK�KH�KDV�NHSW�XS�WKH�ILJKW�WR�DOHUW�WKH

$PHULFDQ�SHRSOH�WR�WKH�SORW�WR�GHVWUR\�WKH�VRYHUHLJQW\�RI

WKH�8QLWHG�6WDWHV�RI�$PHULFD�DQG�WKH�HQVXLQJ

HQVODYHPHQW �RI�WKH�$PHULFDQ�SHRSOH�LQ�D� 81,7('

1$7,216��2QH�:RUOG�*RYHUQPHQW��

,Q�KLV�VHQVDWLRQDO�UHFRUGLQJ��WKLV�WUDQVFULSW���KH�UHYHDOV

WKH�EHJLQQLQJ�RI�WKH�2QH�:RUOG�HQVODYHPHQW�SORW�WKDW�ZDV

ODXQFKHG�WZR�FHQWXULHV�DJR�E\�RQH�$GDP�:HLVKDXSW��DQ

DSRVWDWH�&DWKROLF�3ULHVW �ZKR��),1$1&('�%<�7+(�+286(

2)�527+6&+,/'��FUHDWHG�ZKDW�KH�FDOOHG���7+(

,//80,1$7,���0U��)DJDQ�GHVFULEHV��:,7+�'2&80(17$5<

(9,'(1&(��KRZ�WKLV�,//80,1$7,�EHFDPH�WKH�LQVWUXPHQW

RI�WKH�+RXVH�RI�5RWKVFKLOG�WR�DFKLHYH�D��2QH�:RUOG

*RYHUQPHQW��DQG�KRZ�HYHU\�:DU�GXULQJ�WKH�SDVW�WZR

FHQWXULHV�ZDV�IRPHQWHG�E\�WKLV�,//80,1$7,��+H�GHVFULEHV

KRZ�RQH�-DFRE�+��6FKLII�ZDV�VHQW�WR�WKH�8QLWHG�6WDWHV�E\

WKH�5RWKVFKLOGV�WR�IXUWKHU�WKH�,//80,1$7,�SORW�DQG�KRZ

)UHHGRP��DQG�UHLQVWDWH�*RGV

3HUIHFW�/DZV�RI�/LEHUW\�DQG

EULQJ�WKH�SHUSHWUDWRUV�WR�-XVWLFH�

7LPH�LV�UXQQLQJ�RXW

5HFHQW�FRPPHQWV

ZDWFK�RXW�IRU�WKH�JUHHHN�IUDWV���KRXUV����PLQ�DJR

7KLV�FDVH�KDV�SURYHG�WKDW��GD\V����PLQ�DJR

/LNH�WKH�$OFRKRO�7UHDWPHQW��GD\V���KRXUV�DJR

$-��ZHHN���GD\V�DJR

$OO�WKH�HYLGHQFH�\RX�QHHG���ZHHNV���GD\V�DJR

�����ZHHNV���GD\V�DJR

)UHHPDVRQ�VHFUHW��ZHHNV���GD\V�DJR

ZHOO�L�WKLQN�\RX�QHHG�WR��ZHHNV���GD\V�DJR

VRXOFL��,�KRSH�WKLV�ILQGV��ZHHNV���GD\V�DJR

DQG�:KDW�PDNHV�VHQVH"��ZHHNV����KRXUV�DJR

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

��RI��� ���������������30

Page 4: Fagan Transcript

6FKLII�SORWWHG�WR�JHW�FRQWURO�RI�ERWK�WKH�'HPRFUDWLF�DQG

WKH�5HSXEOLFDQ�3DUWLHV��+RZ�6FKLII�VHGXFHG�RXU�&RQJUHVV

DQG�RXU�3UHVLGHQWV�WR�DFKLHYH�FRQWURO�RI�RXU�HQWLUH�0RQH\�

6\VWHP�DQG�FUHDWH�WKH�,QFRPH�7D[�&$1&(5�DQG�KRZ

6FKLII�DQG�KLV�FR�FRQVSLUDWRUV�FUHDWHG�WKH��&281&,/�21

)25(,*1�5(/$7,216��WR�FRQWURO�RXU�HOHFWHG�RIILFLDOV�WR

JUDGXDOO\�GULYH�WKH�8�6��LQWR�EHFRPLQJ�DQ�HQVODYHG�XQLW�RI

D��81,7('�1$7,216��2QH�:RUOG�*RYHUQPHQW�

,Q�VKRUW�WKLV�5HFRUGLQJ��7UDQVFULSW��LV�WKH�PRVW�LQWHUHVWLQJ

DQG�WKH�PRVW�KRUULI\LQJ���$1'�)$&78$/���VWRU\�RI�WKH

PRVW�VHQVDWLRQDO�SORW�LQ�WKH�KLVWRU\�RI�WKH�:RUOG�

(YHU\ERG\�ZKR�ORYHV�RXU�&RXQWU\���ZKR�ORYHV�*RG���ZKR

ZRXOG�VDYH�&KULVWLDQLW\��:+,&+�7+(�,//80,1$7,�,6

'(',&$7('�72�'(6752<���ZKR�ZRXOG�VDYH�RXU�VRQV�IURP

G\LQJ�RQ�.RUHDQ��RQ�9LHWQDP��RQ�6RXWK�$IULFDQ��DQG�QRZ

RQ�WKH�EDWWOHILHOGV�RI�WKH�0LGGOH�(DVW��VKRXOG�KHDU�WKLV

5HFRUGLQJ��7KHUH�LV�DEVROXWHO\�QR�GRXEW�WKDW�DQ\RQH�ZKR

'2(6�KHDU��UHDG��WKLV�DPD]LQJ�VWRU\�ZLOO�MRLQ�LQ�WKH�ILJKW

WR�VDYH�RXU�&RXQWU\�DQG�RXU�1DWLRQV�<RXWK�

0\URQ�)DJDQV�UHFRUGLQJ�WRRN�SODFH�VRPHWLPH�LQ�WKH

����V��3OHDVH�WDNH�WKH�WLPH�WR��9(5,)<��WKH�VWDWHPHQWV

PDGH�KHUHLQ��:H�GRQW�H[SHFW�\RX�WR�WDNH�0U��)DJDQV

ZRUG�DW�IDFH�YDOXH��:H�VXJJHVW�WKDW�\RX�YLVLW�WKH��/DZ�

DQG��'HSRVLWRU\��OLEUDULHV�WKDW�DUH�ORFDWHG�WKURXJKRXW

\RXU�VWDWH��7KH�WHOHSKRQH�QXPEHUV�DQG�DGGUHVVHV�OLVWHG

KHUHLQ�DUH�PRVW�OLNHO\�RXW�RI�GDWH�DV�0U��)DJDQ�LV�QR

ORQJHU�ZLWK�XV�

7+(�,//80,1$7,�$1'�7+(�&281&,/�21)25(,*1�5(/$7,216

��

�%\�0\URQ�)DJDQ��

7KH�TXHVWLRQ�RI�KRZ�DQG�ZK\�WKH�8QLWHG�1DWLRQV�LV�WKH

FUX[�RI�WKH�JUHDW�FRQVSLUDF\�WR�GHVWUR\�WKH�VRYHUHLJQW\�RI

WKH�8QLWHG�6WDWHV�DQG�WKH�HQVODYHPHQW�RI�WKH�$PHULFDQ

SHRSOH�ZLWKLQ�D�8�1��RQH�ZRUOG�GLFWDWRUVKLS�LV�D�FRPSOHWH

DQG�XQNQRZQ�P\VWHU\�WR�WKH�YDVW�PDMRULW\�RI�WKH

$PHULFDQ�SHRSOH��7KH�UHDVRQ�IRU�WKLV�XQDZDUHQHVV�RI�WKH

IULJKWHQLQJ�GDQJHU�WR�RXU�FRXQWU\�DQG�WR�WKH�HQWLUH�IUHH

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

��RI��� ���������������30

Page 5: Fagan Transcript

ZRUOG�LV�VLPSOH��7KH�PDVWHUPLQGV�EHKLQG�WKLV�JUHDW

FRQVSLUDF\�KDYH�DEVROXWH�FRQWURO�RI�DOO�RI�RXU

PDVV�FRPPXQLFDWLRQV�PHGLD ��HVSHFLDOO\�WHOHYLVLRQ��WKH

UDGLR��WKH�SUHVV��DQG�+ROO\ZRRG��:H�DOO�NQRZ�WKDW�RXU

6WDWH�'HSDUWPHQW��WKH�3HQWDJRQ��DQG�WKH�:KLWH�+RXVH

KDYH�EUD]HQO\�SURFODLPHG�WKDW�WKH\�KDYH�WKH�ULJKW�DQG�WKH

SRZHU�WR�PDQDJH�WKH�QHZV��WR�WHOO�XV�QRW�WKH�WUXWK�EXW

ZKDW�WKH\�ZDQW�XV�WR�EHOLHYH��7KH\�KDYH�VHL]HG�WKDW

SRZHU�RQ�RUGHUV�IURP�WKHLU�PDVWHUV�RI�WKH�JUHDW

FRQVSLUDF\�DQG�WKH�REMHFWLYH�LV�WR�EUDLQZDVK�WKH�SHRSOH

LQWR�DFFHSWLQJ�WKH�SKRQ\�SHDFH�EDLW�WR�WUDQVIRUP�WKH

8QLWHG�6WDWHV�LQWR�DQ�HQVODYHG�XQLW�RI�WKH�8QLWHG�1DWLRQV

RQH�ZRUOG�JRYHUQPHQW�

([FHUSW�IURP�0RYLH��7KH\�/LYH

�5HDOSOD\HU��PRYLH�H[WUDFW�

5HDOSOD\HU�SURJUDP�GRZQORDG

>/LQN�WR�7KH\�/LYH�:HESDJH�@

�)LUVW�RI�DOO��EHDU�LQ�PLQG�WKDW�WKH�VR�FDOOHG�8�1��SROLFH�

DFWLRQ�LQ�.RUHD��IRXJKW�E\�WKH�8QLWHG�6WDWHV�LQ�ZKLFK

��������RI�RXU�VRQV�ZHUH�PXUGHUHG�DQG�PDLPHG��ZDV�SDUW

RI�WKH�SORW��MXVW�DV�WKH�XQGHFODUHG�E\�&RQJUHVV�ZDU�LQ

9LHWQDP�LQ�ZKLFK�RXU�VRQV�DUH�G\LQJ�LV�SDUW�RI�WKH�SORW�

MXVW�DV�WKH�SORW�DJDLQVW�5KRGHVLD�DQG�6RXWK�$IULFD�LQ

ZKLFK�RXU�VRQV�ZLOO�EH�G\LQJ�LV�SDUW�RI�WKH�8�1��SORW�

+RZHYHU��WKH�YLWDOO\�LPSRUWDQW�WKLQJ�IRU�DOO�$PHULFDQV��DOO

\RX�PRWKHUV�RI�WKH�ER\V�ZKR�GLHG�LQ�.RUHD�DQG�DUH�QRZ

G\LQJ�LQ�9LHWQDP��WR�NQRZ�LV�WKDW�RXU�VR�FDOOHG�OHDGHUV�LQ

:DVKLQJWRQ��ZKR�ZH�HOHFWHG�WR�VDIHJXDUG�RXU�QDWLRQ�DQG

RXU�&RQVWLWXWLRQ��DUH�WKH�EHWUD\HUV�DQG�WKDW�EHKLQG�WKHP

DUH�D�FRPSDUDWLYHO\�VPDOO�JURXS�RI�PHQ�ZKRVH

VROH�REMHFWLYH�LV�WR�HQVODYH�WKH�ZKROH�ZRUOG�RI�KXPDQLW\

LQ�WKHLU�VDWDQLF�SORW�RI�RQH�ZRUOG�JRYHUQPHQW�

�1RZ�LQ�RUGHU�WR�JLYH�\RX�D�YHU\�FOHDU�SLFWXUH�RI�WKLV

VDWDQLF�SORW��,�ZLOO�JR�EDFN�WR�LWV�EHJLQQLQJ��FOHDU�EDFN�LQ

WKH�PLGGOH�RI�WKH���WK�FHQWXU\�DQG�QDPH�WKH�PHQ�ZKR

SXW�WKDW�SORW�LQWR�DFWLRQ�DQG�WKHQ�EULQJ�\RX�GRZQ�WR�WKH

SUHVHQW���WRGD\V�VWDWXV�RI�WKDW�SORW��1RZ�DV�D�PDWWHU�RI

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

��RI��� ���������������30

Page 6: Fagan Transcript

IXUWKHU�LQWHOOLJHQFH��D�WHUP�XVHG�E\�WKH�)%,��OHW�PH�FODULI\

WKH�PHDQLQJ�RI�WKH�H[SUHVVLRQ��KH�LV�D�OLEHUDO���7KH

HQHP\��PHDQLQJ�WKH�RQH�ZRUOG�FRQVSLUDWRUV��KDYH�VHL]HG

XSRQ�WKDW�ZRUG��OLEHUDO��DV�D�FRYHU�XS�IRU�WKHLU�DFWLYLWLHV�

,W�VRXQGV�VR�LQQRFHQW�DQG�VR�KXPDQLWDULDQ�WR�EH�OLEHUDO�

:HOO��PDNH�VXUH�WKDW�WKH�SHUVRQ�ZKR�FDOOV�KLPVHOI�D�OLEHUDO

RU�LV�GHVFULEHG�DV�D�OLEHUDO�LV�QRW��LQ�WUXWK��D��UHG��

�1RZ�WKHQ��WKLV�VDWDQLF�SORW�ZDV�ODXQFKHG�EDFN�LQ�WKH

����V�ZKHQ�LW�ILUVW�FDPH�LQWR�H[LVWHQFH�XQGHU�WKH�QDPH

�,OOXPLQDWL���7KLV�,OOXPLQDWL�ZDV�RUJDQL]HG�E\�RQH�$GDP

:HLVKDXSW��ERUQ�D�-HZ��ZKR�ZDV�FRQYHUWHG�WR�&DWKROLFLVP

DQG�EHFDPH�D�&DWKROLF�SULHVW��DQG�WKHQ��DW�WKH�EHKHVW�RI

WKH�WKHQ�QHZO\�RUJDQL]HG�+RXVH�RI�5RWKVFKLOG��GHIHFWHG

DQG�RUJDQL]HG�WKH�,OOXPLQDWL��1DWXUDOO\��WKH�5RWKVFKLOGV

ILQDQFHG�WKDW�RSHUDWLRQ�DQG�HYHU\�ZDU�VLQFH�WKHQ�

EHJLQQLQJ�ZLWK�WKH�)UHQFK�5HYROXWLRQ��KDV�EHHQ�SURPRWHG

E\�WKH�,OOXPLQDWL�RSHUDWLQJ�XQGHU�YDULRXV�QDPHV�DQG

JXLVHV��,�VD\�XQGHU�YDULRXV�QDPHV�DQG�JXLVHV�EHFDXVH

DIWHU�WKH�,OOXPLQDWL�ZDV�H[SRVHG�DQG�EHFDPH�QRWRULRXV�

:HLVKDXSW�DQG�KLV�FR�FRQVSLUDWRUV�EHJDQ�WR�RSHUDWH�XQGHU

YDULRXV�RWKHU�QDPHV��,Q�WKH�8QLWHG�6WDWHV��LPPHGLDWHO\

DIWHU�:RUOG�:DU�,��WKH\�VHW�XS�ZKDW�WKH\�FDOOHG�WKH

�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV���FRPPRQO\�UHIHUUHG�WR�DV

WKH�&)5��DQG�WKLV�&)5�LV�DFWXDOO\�WKH�,OOXPLQDWL�LQ�WKH

8QLWHG�6WDWHV�DQG�LWV�KLHUDUFK\��7KH�PDVWHUPLQGV�LQ

FRQWURO�RI�WKH�RULJLQDO�,OOXPLQDWL�FRQVSLUDWRUV��ZHUH

IRUHLJQHUV��EXW�WR�FRQFHDO�WKDW�IDFW��PRVW�RI�WKHP�FKDQJHG

WKHLU�RULJLQDO�IDPLO\�QDPHV�WR�$PHULFDQ�VRXQGLQJ�QDPHV�

)RU�H[DPSOH��WKH�WUXH�QDPH�RI�WKH�'LOORQV��&ODUHQFH�DQG

'RXJODV�'LOORQ��RQH�6HFUHWDU\�RI�WKH�8�6��7UHDVXU\

'HSDUWPHQW���LV�/DSRVN\��,OO�FRPH�EDFN�WR�DOO�WKLV�ODWHU�

�7KHUH�LV�D�VLPLODU�HVWDEOLVKPHQW�RI�WKH�,OOXPLQDWL�LQ

(QJODQG�RSHUDWLQJ�XQGHU�WKH�QDPH�RI�WKH��%ULWLVK�,QVWLWXWH

RI�,QWHUQDWLRQDO�$IIDLUV����7KH� 5R\DO �,QVWLWXWH�RI

,QWHUQDWLRQDO�$IIDLUV��DFWXDOO\��7KHUH�DUH�VLPLODU�VHFUHW

,OOXPLQDWL�RUJDQL]DWLRQV�LQ�)UDQFH��*HUPDQ\��DQG�RWKHU

QDWLRQV�RSHUDWLQJ�XQGHU�GLIIHUHQW�QDPHV�DQG�DOO�WKHVH

RUJDQL]DWLRQV��LQFOXGLQJ�WKH�&)5��FRQWLQXRXVO\�VHW�XS

QXPHURXV�VXEVLGLDU\�RU�IURQW�RUJDQL]DWLRQV�WKDW�DUH

LQILOWUDWHG�LQWR�HYHU\�SKDVH�RI�WKH�YDULRXV�QDWLRQV�DIIDLUV�

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

��RI��� ���������������30

Page 7: Fagan Transcript

%XW�DW�DOO�WLPHV��WKH�RSHUDWLRQV�RI�WKHVH�RUJDQL]DWLRQV

ZHUH�DQG�DUH�PDVWHUPLQGHG�DQG�FRQWUROOHG�E\�WKH

,QWHUQDWLRQDOLVW�%DQNHUV��WKH\�LQ�WXUQ�ZHUH�DQG�DUH

FRQWUROOHG�E\�WKH�5RWKVFKLOGV���2QH�RI�WKH�SULPH�DJHQWV�LQ

WKLV�FRQWURO�LV�WKURXJK�WKH�,QWHUQDWLRQDO�%$5�$VVRFLDWLRQ

DQG�LWV�VSOLQWHU�JURXSV�VXFK�DV�WKH�$PHULFD�%$5

$VVRFLDWLRQ��,W�LV�LPSRUWDQW�WR�QRWH�WKDW�WKHUH�DUH�%$5

$VVRFLDWLRQV�LQ�QHDUO\�HYHU\�QDWLRQ�ZRUOG�ZLGH�QRZ�

SXVKLQJ�WKH�8QLWHG�1DWLRQV�DOZD\V��,�GR�KDYH�D�FRS\�RI

WKH������DJUHHPHQW�WKDW�WKH�$PHULFDQ�%$5�VXEPLWWHG

ZKLFK�FRPPLWV�WKH�%$5�WR�VXSSRUW�DQG�SURPRWH�WKH�8�1�

WKURXJKRXW�$PHULFD����'DYLG�*��

�2QH�EUDQFK�RI�WKH�5RWKVFKLOG�IDPLO\�KDG�ILQDQFHG

1DSROHRQ��DQRWKHU�EUDQFK�RI�WKH�5RWKVFKLOGV�ILQDQFHG

%ULWDLQ��*HUPDQ\��DQG�WKH�RWKHU�QDWLRQV�LQ�WKH�1DSROHRQLF

ZDUV�

�,PPHGLDWHO\�DIWHU�WKH�1DSROHRQLF�ZDUV��WKH�,OOXPLQDWL

DVVXPHG�WKDW�DOO�WKH�QDWLRQV�ZHUH�VR�GHVWLWXWH�DQG�VR

ZHDU\�RI�ZDUV�WKDW�WKH\G�EH�JODG�IRU�DQ\�VROXWLRQ��VR�WKH

5RWKVFKLOG�VWRRJHV�VHW�XS�ZKDW�WKH\�FDOOHG�WKH�&RQJUHVV�LQ

9LHQQD�DQG�DW�WKDW�PHHWLQJ�WKH\�WULHG�WR�FUHDWH�WKH�ILUVW

/HDJXH�RI�1DWLRQV��WKHLU�ILUVW�DWWHPSWHG�RQH�ZRUOG

JRYHUQPHQW��RQ�WKH�WKHRU\�WKDW�DOO�WKH�FURZQHG�KHDGV�RI

(XURSHDQ�JRYHUQPHQWV�ZHUH�VR�GHHSO\�LQ�GHEW�WR�WKHP

WKDW�WKH\�ZRXOG�ZLOOLQJO\�RU�XQZLOOLQJO\�VHUYH�DV�WKHLU

VWRRJHV��%XW�WKH�&]DU�RI�5XVVLD�FDXJKW�WKH�VWHQFK�RI�WKH

SORW�DQG�FRPSOHWHO\�WRUSHGRHG�LW��7KH�HQUDJHG�1DWKDQ

5RWKVFKLOG��WKHQ�WKH�KHDG�RI�WKH�G\QDVW\��YRZHG�WKDW

VRPH�GD\�KH�RU�KLV�GHVFHQGDQWV�ZRXOG�GHVWUR\�WKH�&]DU

DQG�KLV�HQWLUH�IDPLO\��DQG�KLV�GHVFHQGDQWV�GLG�DFFRPSOLVK

WKDW�YHU\�WKUHDW�LQ� ������$W�WKLV�SRLQW��EHDU�LQ�PLQG�WKDW

WKH�,OOXPLQDWL�ZDV�QRW�VHW�XS�WR�RSHUDWH�RQ�D�VKRUW�UDQJH

EDVLV��1RUPDOO\�D�FRQVSLUDWRU�RI�DQ\�W\SH�HQWHUV�LQWR�D

FRQVSLUDF\�ZLWK�WKH�H[SHFWDWLRQ�RI�DFKLHYLQJ�KLV�REMHFWLYH

GXULQJ�KLV�RZQ�OLIHWLPH��%XW�WKDW�ZDV�QRW�WKH�FDVH�ZLWK�WKH

,OOXPLQDWL��7UXH��WKH\�KRSHG�WR�DFFRPSOLVK�WKHLU�REMHFWLYH

GXULQJ�WKHLU�OLIHWLPH��EXW�SDUDSKUDVLQJ��7KH�VKRZ�PXVW�JR

RQ���WKH�,OOXPLQDWL�RSHUDWHV�RQ�WKH�YHU\�ORQJ�UDQJH�EDVLV�

:KHWKHU�LW�ZLOO�WDNH�VFRUHV�RI�\HDUV�RU�HYHQ�FHQWXULHV�

WKH\�KDYH�GHGLFDWHG�WKHLU�GHVFHQGDQWV�WR�NHHS�WKH�SRW

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

��RI��� ���������������30

Page 8: Fagan Transcript

ERLOLQJ�XQWLO�WKH\�KRSH�WKH�FRQVSLUDF\�LV�DFKLHYHG�

�1RZ��OHWV�JR�EDFN�WR�WKH�ELUWK�RI�WKH�,OOXPLQDWL��$GDP

:HLVKDXSW�ZDV�D�-HVXLW�WUDLQHG�SURIHVVRU�RI�FDQRQ�ODZ�

WHDFKLQJ�LQ�(QJHOVWRFN�8QLYHUVLW\��ZKHQ�KH�GHIHFWHG�IURP

&KULVWLDQLW\�WR�HPEUDFH�WKH�OXFLIHULDQ�FRQVSLUDF\��,W�ZDV�LQ

�����WKDW�WKH�SURIHVVLRQDO�PRQH\�OHQGHUV��WKH�WKHQ

UHFHQWO\�RUJDQL]HG�+RXVH�RI�5RWKVFKLOG��UHWDLQHG�KLP�WR

UHYLVH�DQG�PRGHUQL]H�WKH�DJH�ROG� SURWRFROV�RI�=LRQLVP �

ZKLFK�IURP�WKH�RXWVHW��ZDV�GHVLJQHG�WR�JLYH�WKH

�6\QDJRJXH�RI�6DWDQ���VR�QDPHG�E\�-HVXV�&KULVW�>DQG�ZKR

DUH��WKHP�ZKLFK�VD\�WKH\�DUH�-HZV�DQG�DUH�QRW�� �

5HYHODWLRQ��$SRFDO\SVH����@��XOWLPDWH�ZRUOG�GRPLQDWLRQ�VR

WKH\�FRXOG�LPSRVH�WKH�OXFLIHULDQ�LGHRORJ\�XSRQ�ZKDW�ZRXOG

UHPDLQ�RI�WKH�KXPDQ�UDFH�DIWHU�WKH�ILQDO�VRFLDO�FDWDFO\VP

E\�XVH�RI�VDWDQLF�GHVSRWLVP��:HLVKDXSW�FRPSOHWHG�KLV�WDVN

0D\����������1RZ�\RX�NQRZ�ZK\�0D\���LV�WKH�JUHDW�GD\

ZLWK�DOO�FRPPXQLVW�QDWLRQV�WR�WKLV�YHU\�GD\��0D\���LV�DOVR

�/DZ�'D\��DV�GHFODUHG�E\�WKH�$PHULFDQ�%DU�$VVRFLDWLRQ��

�7KH�FHOHEUDWLRQ�RI�0D\���>%DDO�%HDOWDLQH@�JRHV�PXFK

IXUWKHU�EDFN�LQWR�KLVWRU\�WKDQ�WKLV��DQG�WKH�GD\�ZDV�SLFNHG

IRU�WKH�DQFLHQW�UHDVRQV��ZKLFK�FRPHV�WKURXJK�3DJDQLVP�

%DDO�ZRUVKLS�DQG�UHYROYHV�DURXQG�WKH�ZRUVKLS�RI�6DWDQ���

'DYLG�*���7KDW�ZDV�WKH�GD\��0D\����������WKDW�:HLVKDXSW

FRPSOHWHG�KLV�SODQ�DQG�RIILFLDOO\�RUJDQL]HG�WKH�,OOXPLQDWL

WR�SXW�WKH�SODQ�LQWR�H[HFXWLRQ��7KDW�SODQ�UHTXLUHG�WKH

GHVWUXFWLRQ�RI�DOO�H[LVWLQJ�JRYHUQPHQWV�DQG�UHOLJLRQV��7KDW

REMHFWLYH�ZDV�WR�EH�UHDFKHG�E\�GLYLGLQJ�WKH�PDVVHV�RI

SHRSOH��ZKRP�KH�:HLVKDXSW��WHUPHG���JR\LVP�

>QDWLRQDOLVP@�RU�KXPDQ�FDWWOH�LQWR�RSSRVLQJ�FDPSV�LQ�HYHU

LQFUHDVLQJ�QXPEHUV�RQ�SROLWLFDO��VRFLDO��HFRQRPLF��DQG

RWKHU�LVVXHV���WKH�YHU\�FRQGLWLRQV�ZH�KDYH�LQ�RXU�FRXQWU\

WRGD\��7KH�RSSRVLQJ�VLGHV�ZHUH�WKHQ�WR�EH�DUPHG�DQG

LQFLGHQWV�SURYLGHG�ZKLFK�ZRXOG�FDXVH�WKHP�WR�ILJKW�DQG

ZHDNHQ�WKHPVHOYHV�DQG�JUDGXDOO\�GHVWUR\�QDWLRQDO

JRYHUQPHQWV�DQG�UHOLJLRXV�LQVWLWXWLRQV��$JDLQ�,�VD\��WKH

YHU\�FRQGLWLRQV�LQ�WKH�ZRUOG�WRGD\�

�$QG�DW�WKLV�SRLQW�OHW�PH�VWUHVV�D�SULPH�IHDWXUH�RI�WKH

,OOXPLQDWL�SODQV��:KHQ�DQG�LI�WKHLU�EOXHSULQW�IRU�ZRUOG

FRQWURO��WKH�3URWRFROV�2I�7KH�(OGHUV�2I�=LRQ ��LV�GLVFRYHUHG

DQG�H[SRVHG��WKH\�ZRXOG�ZLSH�DOO�WKH�-HZV�RII�WKH�IDFH�RI

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

��RI��� ���������������30

Page 9: Fagan Transcript

WKH�HDUWK�LQ�RUGHU�WR�GLYHUW�VXVSLFLRQV�IURP�WKHPVHOYHV��,I

\RX�WKLQN�WKLV�LV�IDU�IHWFKHG��EHDU�LQ�PLQG�WKDW�WKH\

SHUPLWWHG�+LWOHU��D�OLEHUDO�VRFLDOLVW�KLPVHOI��ZKR�ZDV

ILQDQFHG�E\�FRUUXSW�.HQQHG\��WKH�:DUEXUJV��DQG�WKH

5RWKVFKLOGV��WR�LQFLQHUDWH���������-HZV�

�1RZ�MXVW�ZK\�GLG�WKH�FRQVSLUDWRUV�FKRRVH�WKH�ZRUG�

�,OOXPLQDWL��IRU�WKHLU�VDWDQLF�RUJDQL]DWLRQ"�:HLVKDXSW

KLPVHOI�VDLG�WKDW�WKH�ZRUG�LV�GHULYHG�IURP�/XFLIHU�DQG

PHDQV���KROGHU�RI�WKH�OLJKW���8VLQJ�WKH�OLH�WKDW�KLV

REMHFWLYH�ZDV�WR�EULQJ�DERXW�D�RQH�ZRUOG�JRYHUQPHQW�WR

HQDEOH�WKRVH�ZLWK�PHQWDO�DELOLW\�WR�JRYHUQ�WKH�ZRUOG�DQG

SUHYHQW�DOO�ZDUV�LQ�WKH�IXWXUH��,Q�VKRUW��XVLQJ�WKH�ZRUGV�

�SHDFH�RQ�HDUWK��DV�KLV�EDLW��H[DFWO\�DV�WKDW�VDPH�EDLW�DV�

�SHDFH��ZDV�XVHG�E\�WKH������FRQVSLUDWRUV�WR�IRUFH�WKH

8QLWHG�1DWLRQV�RQ�XV��:HLVKDXSW�ILQDQFHG��,�UHSHDW��E\�WKH

5RWKVFKLOGV��UHFUXLWHG�VRPH�������SDLG�IROORZHUV��7KHVH

LQFOXGHG�WKH�PRVW�LQWHOOLJHQW�PHQ�LQ�WKH�ILHOG�RI�DUWV�DQG

OHWWHUV��HGXFDWLRQ��WKH�VFLHQFHV��ILQDQFH��DQG�LQGXVWU\��+H

WKHQ�HVWDEOLVKHG�/RGJHV�RI�WKH�*UDQG�2ULHQW��0DVRQLF

/RGJHV�WR�EH�WKHLU�VHFUHW�KHDGTXDUWHUV�DQG�,�DJDLQ�UHSHDW�

WKDW�LQ�DOO�RI�WKLV�KH�ZDV�DFWLQJ�XQGHU�RUGHUV�IURP�WKH

+RXVH�RI�5RWKVFKLOG��7KH�PDLQ�IHDWXUHV�RI�WKH�:HLVKDXSW

SODQ�RI�RSHUDWLRQ�UHTXLUHG�KLV�,OOXPLQDWL�WR�GR�WKH

IROORZLQJ�WKLQJV�WR�KHOS�WKHP�WR�DFFRPSOLVK�WKHLU�SXUSRVH�

��8VH�PRQHWDU\�DQG�VH[�EULEHU\�WR�REWDLQ�FRQWURO�RI�PHQ

DOUHDG\�LQ�KLJK�SODFHV �LQ�WKH�YDULRXV�OHYHOV�RI�DOO

JRYHUQPHQWV�DQG�RWKHU�ILHOGV�RI�HQGHDYRU��2QFH

LQIOXHQWLDO�SHUVRQV�KDG�IDOOHQ�IRU�WKH�OLHV��GHFHLWV��DQG

WHPSWDWLRQV�RI�WKH�,OOXPLQDWL�WKH\�ZHUH�WR�EH�KHOG�LQ

ERQGDJH�E\�DSSOLFDWLRQ�RI�SROLWLFDO�DQG�RWKHU�IRUPV�RI

EODFNPDLO��WKUHDWV�RI�ILQDQFLDO�UXLQ��SXEOLF�H[SRVXUH��DQG

ILVFDO�KDUP��HYHQ�GHDWK�WR�WKHPVHOYHV�DQG�ORYHG�PHPEHUV

RI�WKHLU�IDPLOLHV�

�� �(SKHVLDQV������3XW�RQ�WKH�ZKROH�DUPRXU�RI�*RG��WKDW

\H�PD\�EH�DEOH�WR�VWDQG�DJDLQVW�WKH�ZLOHV�RI�WKH�GHYLO�

�����)RU�ZH�ZUHVWOH�QRW�DJDLQVW�IOHVK�DQG�EORRG��EXW

DJDLQVW�SULQFLSDOLWLHV��DJDLQVW�SRZHUV��DJDLQVW�WKH�UXOHUV�RI

WKH�GDUNQHVV�RI�WKLV�ZRUOG��DJDLQVW� VSLULWXDO�ZLFNHGQHVV

LQ�KLJK�>SODFHV@�

'R�\RX�UHDOL]H�KRZ�PDQ\�SUHVHQW�WRS�RIILFLDOV�LQ�RXU

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

��RI��� ���������������30

Page 10: Fagan Transcript

SUHVHQW�JRYHUQPHQW�LQ�:DVKLQJWRQ�DUH�FRQWUROOHG�LQ�MXVW

WKDW�ZD\�E\�WKH�&)5"�'R�\RX�UHDOL]H�KRZ�PDQ\

KRPRVH[XDOV�LQ�RXU�6WDWH�'HSDUWPHQW��WKH�3HQWDJRQ��DOO

IHGHUDO�DJHQFLHV��HYHQ�LQ�WKH�:KLWH�+RXVH�DUH�FRQWUROOHG

WKDW�ZD\"��

��,OOXPLQDWL�DQG�WKH�IDFXOWLHV�RI�FROOHJHV�DQG�XQLYHUVLWLHV

ZHUH�WR�FXOWLYDWH�VWXGHQWV�SRVVHVVLQJ�H[FHSWLRQDO�PHQWDO

DELOLW\�EHORQJLQJ�WR�ZHOO�EUHG�IDPLOLHV�ZLWK�LQWHUQDWLRQDO

OHDQLQJV�DQG�UHFRPPHQG�WKHP�IRU�VSHFLDO�WUDLQLQJ�LQ

LQWHUQDWLRQDOLVP��6XFK�WUDLQLQJ�ZDV�WR�EH�SURYLGHG�E\

JUDQWLQJ�VFKRODUVKLSV�WR�WKRVH�VHOHFWHG�E\�WKH

,OOXPLQDWLVWV���7KDW�JLYHV�\RX�DQ�LGHD�ZKDW�D��5KRGHV

6FKRODUVKLS��PHDQV��,W�PHDQV�LQGRFWULQDWLRQ�LQWR

DFFHSWLQJ�WKH�LGHD�WKDW�RQO\�D�RQH�ZRUOG�JRYHUQPHQW�FDQ

SXW�DQ�HQG�WR�UHFXUULQJ�ZDUV�DQG�VWULIH��7KDWV�KRZ�WKH

8QLWHG�1DWLRQV�ZDV�VROG�WR�WKH�$PHULFDQ�SHRSOH�

�2QH�RI�WKH�PRVW�QRWDEOH�5KRGHV�VFKRODUV�ZH�KDYH�LQ�RXU

FRXQWU\�LV�6HQDWRU�:LOOLDP�-��)XOEULJKW��VRPHWLPHV

UHIHUUHG�WR�DV�KDOI�EULJKW��+LV�HQWLUH�YRWLQJ�UHFRUG�VSHOOV

,OOXPLQDWL��$OO�VXFK�VFKRODUV�ZHUH�WR�EH�ILUVW�SHUVXDGHG�DQG

WKHQ�FRQYLQFHG�WKDW�PHQ�RI�VSHFLDO�WDOHQW�DQG�EUDLQV�KDYH

WKH�ULJKW�WR�UXOH�WKRVH�OHVV�JLIWHG�RQ�WKH�JURXQG�WKDW�WKH

PDVVHV�GRQW�NQRZ�ZKDW�LV�EHVW�IRU�WKHP�ILVFDOO\�

PHQWDOO\��DQG�VSLULWXDOO\��,Q�DGGLWLRQ�WR�WKH�5KRGHV�DQG

VLPLODU�VFKRODUVKLSV��WRGD\�WKHUH�DUH�WKUHH�VSHFLDO

,OOXPLQDWL�VFKRROV�ORFDWHG�LQ�*RUGRQVWRZQ�LQ�6FRWODQG�

6DOHP�LQ�*HUPDQ\��DQG�$QQDYULJKWD�LQ�*UHHFH��7KHVH

WKUHH�DUH�NQRZQ�RQHV��EXW�WKHUH�DUH�RWKHUV�WKDW�DUH�NHSW

XQGHUFRYHU��3ULQFH�3KLOLS��WKH�KXVEDQG�RI� %ULWDLQV�4XHHQ

(OL]DEHWK��ZDV�HGXFDWHG�DW�*RUGRQVWRZQ�� DV�ZDV�DOVR

3ULQFH�&KDUOHV ��DW�WKH�LQVWLJDWLRQ�RI�/RUG�/RXLV

0RXQWEDWWHQ��KLV�XQFOH��D�5RWKVFKLOG�UHODWLYH��ZKR�EHFDPH

%ULWDLQV�$GPLUDO�RI�WKH�)OHHW�DIWHU�:RUOG�:DU�,,�HQGHG���

��$OO�LQIOXHQWLDO�SHRSOH�WUDSSHG�LQWR�FRPLQJ�XQGHU�WKH

FRQWURO�RI�WKH�,OOXPLQDWL��SOXV�WKH�VWXGHQWV�ZKR�KDG�EHHQ

VSHFLDOO\�HGXFDWHG�DQG�WUDLQHG��ZHUH�WR�EH�XVHG�DV�DJHQWV

DQG�SODFHG�EHKLQG�WKH�VFHQHV�RI�DOO�JRYHUQPHQWV�DV

H[SHUWV�DQG�VSHFLDOLVWV�VR�WKH\�ZRXOG�DGYLVH�WKH�WRS

H[HFXWLYHV�WR�DGRSW�SROLFLHV�ZKLFK�ZRXOG�LQ�WKH�ORQJ�UXQ

VHUYH�WKH�VHFUHW�SODQV�RI�WKH�,OOXPLQDWL�RQH�ZRUOG

FRQVSLUDF\�DQG�EULQJ�DERXW�WKH�GHVWUXFWLRQ�RI�WKH

JRYHUQPHQWV�DQG�UHOLJLRQV�WKH\�ZHUH�HOHFWHG�RU�DSSRLQWHG

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 11: Fagan Transcript

WR�VHUYH���'R�\RX�NQRZ�KRZ�PDQ\�VXFK�PHQ�RSHUDWH�LQ

RXU�JRYHUQPHQW�DW�WKLV�YHU\�WLPH"�5XVN��0F1DPDUD�

+XEHUW�+XPSKUH\��)XOEULJKW��.HHNOH��DQG�JRHV�RQ�DQG�RQ

DQG�RQ���

��3HUKDSV�WKH�PRVW�YLWDO�GLUHFWLYH�LQ�:HLVKDXSWV�SODQ�ZDV

WR�REWDLQ�DEVROXWH�FRQWURO�RI�WKH�SUHVV��DW�WKDW�WLPH�WKH

RQO\�PDVV�FRPPXQLFDWLRQV�PHGLD��WR�GLVWULEXWH

LQIRUPDWLRQ�WR�WKH�SXEOLF�VR�WKDW�DOO�QHZV�DQG�LQIRUPDWLRQ

FRXOG�EH�VODQWHG�VR�WKDW�WKH�PDVVHV�FRXOG�EH�FRQYLQFHG

WKDW�D�RQH�ZRUOG�JRYHUQPHQW�LV�WKH�RQO\�VROXWLRQ�WR�RXU

PDQ\�DQG�YDULHG�SUREOHPV���'R�\RX�NQRZ�ZKR�RZQV�DQG

FRQWUROV�RXU�PDVV�FRPPXQLFDWLRQV�PHGLD"�,OO�WHOO�\RX�

3UDFWLFDOO\�DOO�WKH�PRYLH�ORWV�LQ�+ROO\ZRRG�DUH�RZQHG�E\

WKH�/HKPDQV��.XKQ��/RHE��DQG�&RPSDQ\��*ROGPDQ�6DFKV�

DQG�RWKHU�LQWHUQDWLRQDOLVW�EDQNHUV��$OO�WKH�QDWLRQDO�UDGLR

DQG�79�FKDQQHOV�LQ�WKH�QDWLRQ�DUH�RZQHG�DQG�FRQWUROOHG

E\�WKRVH�VDPH�LQWHUQDWLRQDOLVW�EDQNHUV��7KH�VDPH�LV�WUXH

RI�HYHU\�FKDLQ�RI�PHWURSROLWDQ�QHZVSDSHUV�DQG�PDJD]LQHV�

DOVR�RI�WKH�SUHVV�ZLUH�VHUYLFHV��VXFK�DV�$VVRFLDWHG�3UHVV�

8QLWHG�3UHVV��,QWHUQDWLRQDO��HWF���7KH�VXSSRVHG�KHDGV�RI

DOO�WKRVH�PHGLD�DUH�PHUHO\�WKH�IURQWV�IRU�WKH

LQWHUQDWLRQDOLVW�EDQNHUV��ZKR�LQ�WXUQ�FRPSRVH�WKH

KLHUDUFK\�RI�WKH�&)5��WRGD\V�,OOXPLQDWL�LQ�$PHULFD�

�1RZ�FDQ�\RX�XQGHUVWDQG�ZK\�WKH�3HQWDJRQ�3UHVV�DJHQW�

6\OYHVWHU��VR�EUD]HQO\�SURFODLPHG�WKDW�WKH�JRYHUQPHQW

KDV�WKH�ULJKW�WR�OLH�WR�WKH�SHRSOH��:KDW�KH�UHDOO\�PHDQW

ZDV�WKDW�RXU�&)5�FRQWUROOHG�JRYHUQPHQW�KDG�WKH�SRZHU�WR

OLH�WR�DQG�EH�EHOLHYHG�E\�WKH�EUDLQ�ZDVKHG�$PHULFDQ

SHRSOH�

�/HW�XV�DJDLQ�JR�EDFN�WR�WKH�ILUVW�GD\V�RI�WKH�,OOXPLQDWL�

%HFDXVH�%ULWDLQ�DQG�)UDQFH�ZHUH�WKH�WZR�JUHDWHVW�ZRUOG

SRZHUV�LQ�WKH�ODWH�\HDUV�RI�WKH���WK�&HQWXU\��:HLVKDXSW

RUGHUHG�WKH�,OOXPLQDWL�WR�IRPHQW�WKH�FRORQLDO�ZDUV�

LQFOXGLQJ�RXU�5HYROXWLRQDU\�:DU��WR�ZHDNHQ�WKH�%ULWLVK

(PSLUH�DQG�RUJDQL]H�WKH�)UHQFK�5HYROXWLRQ�WR�VWDUW�LQ

������+RZHYHU��LQ�������D�WUXH�DFW�RI�*RG�SODFHG�WKH

%DYDULDQ�JRYHUQPHQW�LQ�SRVVHVVLRQ�RI�HYLGHQFH�ZKLFK

SURYHG�WKH�H[LVWHQFH�RI�WKH�,OOXPLQDWL�DQG�WKDW�HYLGHQFH

FRXOG�KDYH�VDYHG�)UDQFH�LI�WKH\��WKH�)UHQFK�JRYHUQPHQW�

KDGQW�UHIXVHG�WR�EHOLHYH�LW��+HUH�LV�KRZ�WKDW�DFW�RI�*RG

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 12: Fagan Transcript

KDSSHQHG��,W�ZDV�LQ������WKDW�:HLVKDXSW�LVVXHG�KLV�RUGHUV

IRU�WKH�)UHQFK�5HYROXWLRQ��$�*HUPDQ�ZULWHU��QDPHG

=ZHLJ��SXW�LW�LQWR�ERRN�IRUP��,W�FRQWDLQHG�WKH�HQWLUH

,OOXPLQDWL�VWRU\�DQG�:HLVKDXSWV�SODQV��$�FRS\�RI�WKLV�ERRN

ZDV�VHQW�WR�WKH�,OOXPLQLVWV�LQ�)UDQFH�KHDGHG�E\

5REHVSLHUUH�ZKRP�:HLVKDXSW�KDG�GHOHJDWHG�WR�IRPHQW�WKH

)UHQFK�5HYROXWLRQ��7KH�FRXULHU�ZDV�VWUXFN�DQG�NLOOHG�E\

OLJKWHQLQJ�DV�KH�URGH�WKURXJK�5DZOHVWRQ�RQ�KLV�ZD\�IURP

)UDQNIXUW�WR�3DULV��7KH�SROLFH�IRXQG�WKH�VXEYHUVLYH

GRFXPHQWV�RQ�KLV�ERG\�DQG�WXUQHG�WKHP�RYHU�WR�WKH

SURSHU�DXWKRULWLHV��$IWHU�D�FDUHIXO�VWXG\�RI�WKH�SORW��WKH

%DYDULDQ�JRYHUQPHQW�RUGHUHG�WKH�SROLFH�WR�UDLG

:HLVKDXSWV�QHZO\�RUJDQL]HG�/RGJHV�RI�WKH��*UDQG�2ULHQW�

DQG�WKH�KRPHV�RI�KLV�PRVW�LQIOXHQWLDO�DVVRFLDWHV��$OO

DGGLWLRQDO�HYLGHQFH�WKXV�GLVFRYHUHG�FRQYLQFHG�WKH

DXWKRULWLHV�WKDW�WKH�GRFXPHQWV�ZHUH�JHQXLQH�FRSLHV�RI�WKH

FRQVSLUDF\�E\�ZKLFK�WKH�,OOXPLQDWL�SODQQHG�WR�XVH�ZDUV

DQG�UHYROXWLRQV�WR�EULQJ�DERXW�WKH�HVWDEOLVKPHQW�RI�D

RQH�ZRUOG�JRYHUQPHQW��WKH�SRZHUV�RI�ZKLFK�WKH\��KHDGHG

E\�WKH�5RWKVFKLOGV��LQWHQGHG�WR�XVXUS�DV�VRRQ�DV�LW�ZDV

HVWDEOLVKHG��H[DFWO\�LQ�OLQH�ZLWK�WKH�8QLWHG�1DWLRQV�SORW�RI

WRGD\�

�,Q�������WKH�%DYDULDQ�JRYHUQPHQW�RXWODZHG�WKH

,OOXPLQDWL�DQG�FORVHG�WKH�/RGJHV�RI�WKH��*UDQG�2ULHQW���,Q

������WKH\�SXEOLVKHG�DOO�WKH�GHWDLOV�RI�WKH�FRQVSLUDF\��7KH

(QJOLVK�WLWOH�RI�WKDW�SXEOLFDWLRQ�LV���7KH�2ULJLQDO�:ULWLQJV

RI�WKH�2UGHU�DQG�WKH�6HFW�RI�WKH�,OOXPLQDWL���&RSLHV�RI�WKH

HQWLUH�FRQVSLUDF\�ZHUH�VHQW�WR�DOO�WKH�KHDGV�RI�FKXUFK�DQG

VWDWH�LQ�(XURSH��%XW�WKH�SRZHU�RI�WKH�,OOXPLQDWL��ZKLFK

ZDV�DFWXDOO\�WKH�SRZHU�RI�WKH�5RWKVFKLOGV��ZDV�VR�JUHDW

WKDW�WKLV�ZDUQLQJ�ZDV�LJQRUHG��1HYHUWKHOHVV��WKH

,OOXPLQDWL�EHFDPH�D�GLUW\�ZRUG�DQG�LW�ZHQW�XQGHUJURXQG�

�$W�WKH�VDPH�WLPH��:HLVKDXSW�RUGHUHG�,OOXPLQLVWV�WR

LQILOWUDWH�LQWR�WKH�/RGJHV�RI��%OXH�0DVRQU\��DQG�IRUPHG

WKHLU�RZQ�VHFUHW�VRFLHWLHV�ZLWKLQ�DOO�VHFUHW�VRFLHWLHV��2QO\

0DVRQV�ZKR�SURYHG�WKHPVHOYHV�LQWHUQDWLRQDOLVWV�DQG�WKRVH

ZKRVH�FRQGXFW�SURYHG�WKH\�KDG�GHIHFWHG�IURP�*RG�ZHUH

LQLWLDWHG�LQWR�WKH�,OOXPLQDWL��7KHQFHIRUWK��WKH�FRQVSLUDWRUV

GRQQHG�WKH�FORDN�RI�SKLODQWKURS\�DQG�KXPDQLWDULDQLVP�WR

FRQFHDO�WKHLU�UHYROXWLRQDU\�DQG�VXEYHUVLYH�DFWLYLWLHV��,Q

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 13: Fagan Transcript

RUGHU�WR�LQILOWUDWH�LQWR�0DVRQLF�/RGJHV�LQ�%ULWDLQ�

:HLVKDXSW�LQYLWHG�-RKQ�5RELVRQ�RYHU�WR�(XURSH��5RELVRQ

ZDV�D�KLJK�GHJUHH�0DVRQ�LQ�WKH��6FRWWLVK�5LWH���+H�ZDV�D

SURIHVVRU�RI�QDWXUDO�SKLORVRSK\�DW�(GLQEXUJK�8QLYHUVLW\

DQG�6HFUHWDU\�RI�WKH�5R\DO�6RFLHW\�RI�(GLQEXUJK��5RELVRQ

GLG�QRW�IDOO�IRU�WKH�OLH�WKDW�WKH�REMHFWLYH�RI�WKH�,OOXPLQDWL

ZDV�WR�FUHDWH�D�EHQHYROHQW�GLFWDWRUVKLS��EXW�KH�NHSW�KLV

UHDFWLRQV�WR�KLPVHOI�VR�ZHOO�WKDW�KH�ZDV�HQWUXVWHG�ZLWK�D

FRS\�RI�:HLVKDXSWV�UHYLVHG�FRQVSLUDF\�IRU�VWXG\�DQG

VDIHNHHSLQJ�

$Q\ZD\��EHFDXVH�WKH�KHDGV�RI�VWDWH�DQG�FKXUFK�LQ�)UDQFH

ZHUH�GHOXGHG�LQWR�LJQRULQJ�WKH�ZDUQLQJV�JLYHQ�WKHP��WKH

UHYROXWLRQ�EURNH�RXW�LQ������DV�VFKHGXOHG�E\�:HLVKDXSW�

,Q�RUGHU�WR�DOHUW�RWKHU�JRYHUQPHQWV�WR�WKHLU�GDQJHU��LQ

������5RELVRQ�SXEOLVKHG�D�ERRN�HQWLWOHG���3URRI�RI�D

FRQVSLUDF\�WR�'HVWUR\�DOO�*RYHUQPHQWV�DQG�5HOLJLRQV��EXW

KLV�ZDUQLQJV�ZHUH�LJQRUHG�H[DFWO\�DV�RXU�$PHULFDQ�SHRSOH

KDYH�EHHQ�LJQRULQJ�DOO�ZDUQLQJV�DERXW�WKH�8QLWHG�1DWLRQV

DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV��&)5����/HW�PH�DGG

KHUH��WKDW�LI�WKH�SHRSOH�RI�WKH�HDUWK�ZRXOG�KHHG�+LV�:RUG�

QRQH�RI�WKLV�FRXOG�KDSSHQ��MXVW�WKLQN��LI�WKH�FRPPRQ

SHRSOH�DOO�OLVWHQHG�WR�-HVXV�&KULVW�DQG�UHIXVHG�WR�WDNH

RDWKV��WKHUH�ZRXOG�EH�QR�FRYHU�IRU�WKHVH�GHVSLFDEOH�PHQ���

'DYLG�*��

�1RZ�KHUH�LV�VRPHWKLQJ�WKDW�ZLOO�VWXQ�DQG�YHU\�OLNHO\

RXWUDJH�PDQ\�ZKR�KHDU�WKLV��EXW�WKHUH�LV�GRFXPHQWDU\

SURRI�WKDW�RXU�RZQ�7KRPDV�-HIIHUVRQ�DQG�$OH[DQGHU

+DPLOWRQ�EHFDPH�VWXGHQWV�RI�:HLVKDXSW��-HIIHUVRQ�ZDV

RQH�RI�:HLVKDXSWV�VWURQJHVW�GHIHQGHUV�ZKHQ�KH�ZDV

RXWODZHG�E\�KLV�JRYHUQPHQW�DQG�LW�ZDV�-HIIHUVRQ�ZKR

LQILOWUDWHG�WKH�,OOXPLQDWL�LQWR�WKH�WKHQ�QHZO\�RUJDQL]HG

ORGJHV�RI�WKH��6FRWWLVK�5LWH��LQ�1HZ�(QJODQG��+HUH�LV�WKH

SURRI�

�,Q�������-RKQ�5RELVRQ�ZDUQHG�DOO�0DVRQLF�OHDGHUV�LQ

$PHULFD�WKDW�WKH�,OOXPLQDWL�KDG�LQILOWUDWHG�LQWR�WKHLU�ORGJHV

DQG�RQ�-XO\�����������'DYLG�3DSHQ��3UHVLGHQW�RI�+DUYDUG

8QLYHUVLW\��LVVXHG�WKH�VDPH�ZDUQLQJ�WR�WKH

JUDGXDWLQJ�FODVV�DQG�OHFWXUHG�WKHP�RQ�KRZ�WKH�LQIOXHQFH

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 14: Fagan Transcript

RI�,OOXPLQLVP�ZDV�DFTXLWWLQJ�RQ�$PHULFDQ�SROLWLFV�DQG

UHOLJLRQ��DQG�WR�WRS�LW�RII��-RKQ�4XLQF\�$GDPV��ZKR�KDG

RUJDQL]HG�WKH�1HZ�(QJODQG�0DVRQLF�/RGJHV��LVVXHG�KLV

ZDUQLQJV��+H�ZURWH�WKUHH�OHWWHUV�WR�&RORQHO�:LOOLDP�/�

6WRQH��D�WRS�0DVRQ��LQ�ZKLFK�KH�H[SRVHG�KRZ�-HIIHUVRQ

ZDV�XVLQJ�0DVRQLF�ORGJHV�IRU�VXEYHUVLYH�,OOXPLQLVWLF

SXUSRVHV��7KRVH�WKUHH�OHWWHUV�DUH�DW�WKLV�YHU\�WLPH�LQ

:KLWWHQEXUJ�6TXDUH�/LEUDU\�LQ�3KLODGHOSKLD��,Q�VKRUW�

-HIIHUVRQ��IRXQGHU�RI�WKH�'HPRFUDWLF�3DUW\��ZDV�D�PHPEHU

RI�WKH�,OOXPLQDWL�ZKLFK�DW�OHDVW�SDUWO\�DFFRXQWV�IRU�WKH

FRQGLWLRQ�RI�WKH�SDUW\�DW�WKLV�WLPH�DQG�WKURXJK�LQILOWUDWLRQ

RI�WKH�5HSXEOLFDQ�3DUW\��ZH�KDYH�H[DFWO\�QRWKLQJ�RI�OR\DO

$PHULFDQLVP�WRGD\��7KDW�GLVDVWURXV�UHEXII�DW�WKH�&RQJUHVV

RI�9LHQQD�FUHDWHG�E\�WKH�&]DU�RI�5XVVLD�GLG�QRW�E\�DQ\

PHDQV�GHVWUR\�WKH�,OOXPLQDWL�FRQVSLUDF\��,W�PHUHO\�IRUFHG

WKHP�WR�DGRSW�D�QHZ�VWUDWHJ\�UHDOL]LQJ�WKDW�WKH�RQH�ZRUOG

LGHD�ZDV��IRU�WKH�PRPHQW��NLOOHG��7KH�5RWKVFKLOGV�GHFLGHG

WKDW�WR�NHHS�WKH�SORW�DOLYH�WKH\�ZRXOG�KDYH�WR�GR�LW�E\

KHLJKWHQLQJ�WKHLU�FRQWURO�RI�WKH�PRQH\�V\VWHP�RI�WKH

(XURSHDQ�QDWLRQV�

�(DUOLHU��E\�D�UXVH��WKH�RXWFRPH�RI�WKH�%DWWOH�RI�:DWHUORR

KDG�EHHQ�IDOVLILHG��5RWKVFKLOG�KDG�VSUHDG�D�VWRU\�WKDW

1DSROHRQ�KDG�KDG�RQH�EDG�EDWWOH��ZKLFK�SUHFLSLWDWHG�D

WHUULILF�SDQLF�RQ�WKH�VWRFN�PDUNHW�LQ�(QJODQG��$OO�VWRFNV

KDG�SOXPPHWHG�GRZQ�WR�SUDFWLFDOO\�]HUR�DQG�1DWKDQ

5RWKVFKLOG�ERXJKW�DOO�WKH�VWRFNV�IRU�YLUWXDOO\�D�SHQQ\�RQ

LWV�GROODU�YDOXHV��7KDW�JDYH�KLP�FRPSOHWH�FRQWURO�RI�WKH

HFRQRP\�RI�%ULWDLQ�DQG�YLUWXDOO\�RI�DOO�(XURSH��6R�

LPPHGLDWHO\�DIWHU�WKDW�&RQJUHVV�LQ�9LHQQD�KDG

ERRPHUDQJHG��5RWKVFKLOG�KDG�IRUFHG�%ULWDLQ�WR�VHW�XS�D

QHZ��%DQN�RI�(QJODQG���RYHU�ZKLFK�KH�KDG�DEVROXWH

FRQWURO��H[DFWO\��DV�ODWHU�WKURXJK�-DFRE�6FKLII��KH

HQJLQHHUHG�RXU�RZQ��)HGHUDO�5HVHUYH�$FW��ZKLFK�JDYH�WKH

+RXVH�RI�5RWKVFKLOG�D�VHFUHW�FRQWURO�RI�WKH�HFRQRP\�LQ�WKH

8QLWHG�6WDWHV��%XW�QRZ�IRU�D�PRPHQW��OHWV�GZHOO�RQ�WKH

DFWLYLWLHV�RI�WKH�,OOXPLQDWL�LQ�WKH�8QLWHG�6WDWHV�

�,Q�������RQH�&DSWDLQ�:LOOLDP�0RUJDQ�GHFLGHG�LW�ZDV�KLV

GXW\�WR�LQIRUP�DOO�0DVRQV�DQG�WKH�JHQHUDO�SXEOLF�ZKDW�WKH

IXOO�SURRI�ZDV�UHJDUGLQJ�WKH�,OOXPLQDWL��WKHLU�VHFUHW�SODQV�

LQWHQGHG�REMHFWLYHV��DQG�WR�UHYHDO�WKH�LGHQWLWLHV�RI�WKH

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 15: Fagan Transcript

PDVWHUPLQGV�RI�WKH�FRQVSLUDF\��7KH�,OOXPLQDWL�SURPSWO\

WULHG�0RUJDQ�LQ�DEVHQWLD�DQG�FRQYLFWHG�KLP�RI�WUHDVRQ�

7KH\�RUGHUHG�RQH�5LFKDUG�+RZDUG��DQ�(QJOLVK�,OOXPLQLVW�

WR�FDUU\�RXW�WKHLU�VHQWHQFH�RI�H[HFXWLRQ�DV�D�WUDLWRU�

0RUJDQ�ZDV�ZDUQHG�DQG�KH�WULHG�WR�HVFDSH�WR�&DQDGD��EXW

+RZDUG�FDXJKW�XS�ZLWK�KLP�QHDU�WKH�ERUGHU��QHDU�WKH

1LDJDUD�*RUJH�WR�EH�H[DFW��ZKHUH�KH�PXUGHUHG�KLP��7KLV

ZDV�YHULILHG�LQ�D�VZRUQ�VWDWHPHQW�PDGH�LQ�1HZ�<RUN�E\

RQH�$YHU\�$OOHQ�WR�WKH�HIIHFW�WKDW�KH�KHDUG�+RZDUG�UHQGHU

KLV�UHSRUW�RI�WKH�H[HFXWLRQ�WR�D�PHHWLQJ�RI��.QLJKWV

7HPSODUV��LQ�6W��-RKQV�+DOO�LQ�1HZ�<RUN��+H�DOVR�WROG�KRZ

DUUDQJHPHQWV�KDG�EHHQ�PDGH�WR�VKLS�+RZDUG�EDFN�WR

(QJODQG��7KDW�$OOHQ�DIILGDYLW�LV�RQ�UHFRUG�LQ�1HZ�<RUN�&LW\

$UFKLYHV��9HU\�IHZ�0DVRQV�DQG�YHU\�IHZ�RI�WKH�JHQHUDO�

SXEOLF�NQRZ�WKDW�JHQHUDO�GLVDSSURYDO�RYHU�WKDW�LQFLGHQW�RI

PXUGHU�FDXVHG�DSSUR[LPDWHO\�KDOI�RI�DOO�WKH�0DVRQV�LQ�WKH

QRUWKHUQ�MXULVGLFWLRQ�RI�WKH�8QLWHG�6WDWHV�WR�VHFHGH�

&RSLHV�RI�WKH�PLQXWHV�RI�WKH�PHHWLQJ�KHOG�WR�GLVFXVV�WKDW

PDWWHU�DUH�VWLOO�LQ�H[LVWHQFH�LQ�VDIH�KDQGV�DQG�WKDW�DOO�WKDW

VHFUHF\�HPSKDVL]HV�WKH�SRZHU�RI�WKH�PDVWHUPLQGV�RI�WKH

,OOXPLQDWL�WR�SUHYHQW�VXFK�WHUULEOH�HYHQWV�RI�KLVWRU\�IURP

EHLQJ�WDXJKW�LQ�RXU�VFKRROV�

�,Q�WKH�HDUO\�����V��WKH�,OOXPLQDWL�KHOG�D�VHFUHW�PHHWLQJ

LQ�1HZ�<RUN�ZKLFK�ZDV�DGGUHVVHG�E\�D�%ULWLVK�,OOXPLQLVW

QDPHG�:ULJKW��7KRVH�LQ�DWWHQGDQFH�ZHUH�WROG�WKDW�WKH

,OOXPLQDWL�ZDV�RUJDQL]LQJ�WR�XQLWH�WKH�1LKLOLVW�DQG�$WKHLVW

JURXSV�ZLWK�DOO�RWKHU�VXEYHUVLYH�JURXSV�LQWR�DQ

LQWHUQDWLRQDO�JURXS�WR�EH�NQRZQ�DV�&RPPXQLVWV��7KDW�ZDV

ZKHQ�WKH�ZRUG���FRPPXQLVW��ILUVW�FDPH�LQWR�EHLQJ�DQG�LW

ZDV�LQWHQGHG�WR�EH�WKH�VXSUHPH�ZHDSRQ�DQG�VFDUH�ZRUG

WR�WHUULI\�WKH�ZKROH�ZRUOG�DQG�GULYH�WKH�WHUURUL]HG�SHRSOHV

LQWR�WKH�,OOXPLQDWL�RQH�ZRUOG�VFKHPH��7KLV�VFKHPH�

�FRPPXQLVP���ZDV�WR�EH�XVHG�WR�HQDEOH�WKH�,OOXPLQDWL�WR

IRPHQW�IXWXUH�ZDUV�DQG�UHYROXWLRQV��&OLQWRQ�5RRVHYHOW��D

GLUHFW�DQFHVWRU�RI�)UDQNOLQ�5RRVHYHOW��+RUDFH�*UHHOH\��DQG

&KDUOHV�'DQD��IRUHPRVW�QHZVSDSHU�SXEOLVKHUV�RI�WKDW�WLPH

ZHUH�DSSRLQWHG�WR�KHDG�D�FRPPLWWHH�WR�UDLVH�IXQGV�IRU�WKH

QHZ�YHQWXUH��2I�FRXUVH��PRVW�RI�WKH�IXQGV�ZHUH�SURYLGHG

E\�WKH�5RWKVFKLOGV�DQG�WKLV�IXQG�ZDV�XVHG�WR�ILQDQFH�.DUO

0DU[�DQG�(QJHOV�ZKHQ�WKH\�ZURWH��'DV�.DSLWDO��DQG�WKH

�&RPPXQLVW�0DQLIHVWR��LQ�6RKR��(QJODQG��$QG�WKLV�FOHDUO\

UHYHDOV�WKDW�FRPPXQLVP�LV�QRW�D�VR�FDOOHG�LGHRORJ\��EXW�D

VHFUHW�ZHDSRQ��D�ERJ\�PDQ�ZRUG�WR�VHUYH�WKH�SXUSRVH�RI

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 16: Fagan Transcript

WKH�,OOXPLQDWL�

�:HLVKDXSW�GLHG�LQ�������EXW�SULRU�WR�KLV�GHDWK��KH

SUHSDUHG�D�UHYLVHG�YHUVLRQ�RI�WKH�DJH�ROG�FRQVSLUDF\��WKH

,OOXPLQDWL��ZKLFK�XQGHU�YDULRXV�DOLDVHV�ZDV�WR�RUJDQL]H�

ILQDQFH��GLUHFW��DQG�FRQWURO�DOO�LQWHUQDWLRQDO�RUJDQL]DWLRQV

DQG�JURXSV�E\�ZRUNLQJ�WKHLU�DJHQWV�LQWR�H[HFXWLYH

SRVLWLRQV�DW�WKH�WRS��,Q�WKH�8QLWHG�6WDWHV�ZH�KDYH

:RRGURZ�:LOVRQ��)UDQNOLQ�5RRVHYHOW��-DFN�.HQQHG\�

-RKQVRQ��5XVN��0F1DPDUD��)XOEULJKW��*HRUJH�%XVK�HWF���DV

SULPH�H[DPSOHV��,Q�DGGLWLRQ��ZKLOH�.DUO�0DU[�ZDV�ZULWLQJ

WKH��&RPPXQLVW�0DQLIHVWR��XQGHU�WKH�GLUHFWRU�RI�RQH

JURXS�RI�,OOXPLQLVWV��3URIHVVRU�.DUO�5LWWHU�RI�)UDQNIXUW

8QLYHUVLW\�ZDV�ZULWLQJ�WKH�DQWLWKHVLV�XQGHU�WKH�GLUHFWLRQ

RI�DQRWKHU�JURXS��7KH�LGHD�ZDV�WKDW�WKRVH�ZKR�GLUHFW�WKH

RYHUDOO�FRQVSLUDF\�FRXOG�XVH�WKH�GLIIHUHQFHV�LQ�WKRVH�WZR

VR�FDOOHG�LGHRORJLHV�WR�HQDEOH�WKHP�WR�GLYLGH�ODUJHU�DQG

ODUJHU�QXPEHUV�RI�WKH�KXPDQ�UDFH�LQWR�RSSRVLQJ�FDPSV�VR

WKDW�WKH\�FRXOG�EH�DUPHG�DQG�WKHQ�EUDLQZDVKHG�LQWR

ILJKWLQJ�DQG�GHVWUR\LQJ�HDFK�RWKHU��$QG�SDUWLFXODUO\��WR

GHVWUR\�DOO�SROLWLFDO�DQG�UHOLJLRXV�LQVWLWXWLRQV��7KH�ZRUN

5LWWHU�VWDUWHG�ZDV�FRQWLQXHG�DIWHU�KLV�GHDWK�DQG�FRPSOHWHG

E\�WKH�*HUPDQ�VR�FDOOHG�SKLORVRSKHU�)UHLGULFK�:LOKHOP

1LHW]VFKH�ZKR�IRXQGHG�1LHW]VFKHDQLVP��7KLV

1LHW]VFKHDQLVP�ZDV�ODWHU�GHYHORSHG�LQWR�)DVFLVP�DQG�WKHQ

LQWR�1D]LVP�DQG�ZDV�XVHG�WR�IRPHQW�:RUOG�:DU�,�DQG�,,�

�,Q�������WKH�,WDOLDQ�UHYROXWLRQDU\�OHDGHU��*XLVHSSH

0D]]LQL��ZDV�VHOHFWHG�E\�WKH�,OOXPLQDWL�WR�GLUHFW�WKHLU

UHYROXWLRQDU\�SURJUDP�WKURXJKRXW�WKH�ZRUOG��+H�VHUYHG�LQ

WKDW�FDSDFLW\�XQWLO�KH�GLHG�LQ�������EXW�VRPH�\HDUV�EHIRUH

KH�GLHG��0D]]LQL�KDG�HQWLFHG�DQ�$PHULFDQ�*HQHUDO�QDPHG

$OEHUW�3LNH�LQWR�WKH�,OOXPLQDWL��3LNH�ZDV�IDVFLQDWHG�E\�WKH

LGHD�RI�D�RQH�ZRUOG�JRYHUQPHQW�DQG�XOWLPDWHO\�KH�EHFDPH

WKH�KHDG�RI�WKLV�OXFLIHULDQ�FRQVSLUDF\��%HWZHHQ������DQG

�����KH��3LNH��ZRUNHG�RXW�D�PLOLWDU\�EOXHSULQW�IRU�WKUHH

ZRUOG�ZDUV�DQG�YDULRXV�UHYROXWLRQV�WKURXJKRXW�WKH�ZRUOG

ZKLFK�KH�FRQVLGHUHG�ZRXOG�IRUZDUG�WKH�FRQVSLUDF\�WR�LWV

ILQDO�VWDJH�LQ�WKH���WK�FHQWXU\��$JDLQ�,�UHPLQG�\RX�WKDW

WKHVH�FRQVSLUDWRUV�ZHUH�QHYHU�FRQFHUQHG�ZLWK�LPPHGLDWH

VXFFHVV��7KH\�DOVR�RSHUDWHG�RQ�D�ORQJ�UDQJH�YLHZ��3LNH�GLG

PRVW�RI�KLV�ZRUN�LQ�KLV�KRPH�LQ�/LWWOH�5RFN�� $UNDQVDV��%XW

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 17: Fagan Transcript

D�IHZ�\HDUV�ODWHU��ZKHQ�WKH�,OOXPLQDWLV�/RGJHV�RI�WKH

*UDQG�2ULHQW�EHFDPH�VXVSHFW�DQG�UHSXGLDWHG�EHFDXVH�RI

0D]]LQLV�UHYROXWLRQDU\�DFWLYLWLHV�LQ�(XURSH��3LNH

RUJDQL]HG�ZKDW�KH�FDOOHG�WKH�1HZ�DQG�5HIRUPHG�3DOODGLDQ

5LJKW��+H�VHW�XS�WKUHH�6XSUHPH�&RXQFLOV��RQH�LQ

&KDUOHVWRQ��6RXWK�&DUROLQD��RQH�LQ�5RPH��,WDO\��DQG�D

WKLUG�LQ�%HUOLQ��*HUPDQ\��+H�KDG�0D]]LQL�HVWDEOLVK���

VXERUGLQDWH�FRXQFLOV�LQ�VWUDWHJLF�ORFDWLRQV�WKURXJKRXW�WKH

ZRUOG��7KHVH�KDYH�EHHQ�WKH�VHFUHW�KHDGTXDUWHUV�RI�WKH

ZRUOG�UHYROXWLRQDU\�PRYHPHQW�HYHU�VLQFH�

�/RQJ�EHIRUH�0DUFRQL�LQYHQWHG�WKH�UDGLR��WKH�VFLHQWLVWV�LQ

WKH�,OOXPLQDWL�KDG�IRXQG�WKH�PHDQV�IRU�3LNH�DQG�WKH�KHDGV

RI�KLV�FRXQFLOV�WR�FRPPXQLFDWH�VHFUHWO\��,W�ZDV�WKH

GLVFRYHU\�RI�WKDW�VHFUHW�WKDW�HQDEOHG�LQWHOOLJHQFH�RIILFHUV

WR�XQGHUVWDQG�KRZ�DSSDUHQWO\�XQUHODWHG�LQFLGHQWV��VXFK�DV

WKH�DVVDVVLQDWLRQ�RI�DQ�$XVWULDQ�3ULQFH�LQ�6HUELD��WRRN

SODFH�VLPXOWDQHRXVO\�WKURXJKRXW�WKH�ZRUOG��ZKLFK

GHYHORSHG�LQWR�D�ZDU�RU�D�UHYROXWLRQ��3LNHV�SODQ�ZDV�DV

VLPSOH�DV�LW�KDV�SURYHG�HIIHFWLYH��,W�FDOOHG�IRU�FRPPXQLVP�

QD]LVP��SROLWLFDO�]LRQLVP��DQG�RWKHU�LQWHUQDWLRQDO

PRYHPHQWV�WR�EH�RUJDQL]HG�DQG�XVHG�WR�IRPHQW�WKUHH

JOREDO�ZRUOG�ZDUV�DQG�DW�OHDVW�WZR�PDMRU�UHYROXWLRQV�

�7KH�ILUVW�ZRUOG�ZDU�ZDV�WR�EH�IRXJKW�VR�DV�WR�HQDEOH�WKH

,OOXPLQDWL�WR�GHVWUR\�&]DULVP�LQ�5XVVLD��DV�YRZHG�E\

5RWKVFKLOG�DIWHU�WKH�&]DU�KDG�WRUSHGRHG�KLV�VFKHPH�DW�WKH

&RQJUHVV�LQ�9LHQQD��DQG�WR�WUDQVIRUP�5XVVLD�LQWR�D

VWURQJKROG�RI�DWKHLVWLF�FRPPXQLVP��7KH�GLIIHUHQFHV�VWLUUHG

XS�E\�DJHQWV�RI�WKH�,OOXPLQDWL�EHWZHHQ�WKH�%ULWLVK�DQG

*HUPDQ�(PSLUHV�ZHUH�WR�EH�XVHG�WR�IRPHQW�WKLV�ZDU��$IWHU

WKH�ZDU�ZRXOG�EH�HQGHG��FRPPXQLVP�ZDV�WR�EH�EXLOW�XS

DQG�XVHG�WR�GHVWUR\�RWKHU�JRYHUQPHQWV�DQG�ZHDNHQ

UHOLJLRQV�

�:RUOG�:DU�,,��ZKHQ�DQG�LI�QHFHVVDU\��ZDV�WR�EH�IRPHQWHG

E\�XVLQJ�WKH�FRQWURYHUVLHV�EHWZHHQ�)DVFLVWV�DQG�SROLWLFDO

]LRQLVWV��DQG�KHUH�OHW�LW�EH�QRWHG�WKDW�+LWOHU�ZDV�ILQDQFHG

E\�.UXSS��WKH�:DUEXUJV��WKH�5RWKVFKLOGV��DQG�RWKHU

LQWHUQDWLRQDOLVW�EDQNHUV�DQG�WKDW�WKH�VODXJKWHU�RI�WKH

VXSSRVHG�����������-HZV�E\�+LWOHU�GLGQW�ERWKHU�WKH

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 18: Fagan Transcript

-HZLVK�LQWHUQDWLRQDOLVW�EDQNHUV�DW�DOO��7KDW�VODXJKWHU�ZDV

QHFHVVDU\�LQ�RUGHU�WR�FUHDWH�ZRUOGZLGH�KDWUHG�RI�WKH

*HUPDQ�SHRSOH�DQG�WKXV�EULQJ�DERXW�ZDU�DJDLQVW�WKHP��,Q

VKRUW��WKLV�VHFRQG�ZRUOG�ZDU�ZDV�WR�EH�IRXJKW�WR�GHVWUR\

QD]LVP�DQG�LQFUHDVH�WKH�SRZHU�RI�SROLWLFDO�=LRQLVP�VR�WKDW

WKH�VWDWH�RI�,VUDHO�FRXOG�EH�HVWDEOLVKHG�LQ�3DOHVWLQH�

�'XULQJ�WKLV�:RUOG�:DU�,,��LQWHUQDWLRQDO�FRPPXQLVP�ZDV

WR�EH�EXLOW�XS�XQWLO�LW�HTXDOOHG�LQ�VWUHQJWK�WKDW�RI�XQLWHG

&KULVWHQGRP��:KHQ�LW�UHDFKHG�WKDW�SRLQW��LW�ZDV�WR�EH

FRQWDLQHG�DQG�NHSW�LQ�FKHFN�XQWLO�UHTXLUHG�IRU�WKH�ILQDO

VRFLDO�FDWDFO\VP��$V�ZH�NQRZ�QRZ��5RRVHYHOW��&KXUFKLOO�

DQG�6WDOLQ�SXW�WKDW�H[DFW�SROLF\�LQWR�HIIHFW�DQG�7UXPDQ�

(LVHQKRZHU��.HQQHG\��-RKQVRQ��DQG�*HRUJH�%XVK

FRQWLQXHG�WKDW�VDPH�H[DFW�SROLF\�

�:RUOG�:DU�,,, �LV�WR�EH�IRPHQWHG��XVLQJ�WKH�VR�FDOOHG

FRQWURYHUVLHV��E\�WKH�DJHQWV�RI�WKH�,OOXPLQDWL�RSHUDWLQJ

XQGHU�ZKDWHYHU�QHZ�QDPH��WKDW�DUH�QRZ�EHLQJ�VWRUHG�XS

EHWZHHQ�WKH�SROLWLFDO�=LRQLVWV�DQG�WKH�OHDGHUV�RI�WKH

0RVOHP�ZRUOG��7KDW�ZDU�LV�WR�EH�GLUHFWHG�LQ�VXFK�D�PDQQHU

WKDW�DOO�RI�,VODP�DQG�SROLWLFDO�=LRQLVP��,VUDHOLV��ZLOO

GHVWUR\�HDFK�RWKHU�ZKLOH�DW�WKH�VDPH�WLPH��WKH�UHPDLQLQJ

QDWLRQV��RQFH�PRUH�GLYLGHG�RQ�WKLV�LVVXH��ZLOO�EH�IRUFHG�WR

ILJKW�WKHPVHOYHV�LQWR�D�VWDWH�RI�FRPSOHWH�H[KDXVWLRQ�

SK\VLFDOO\��PHQWDOO\��VSLULWXDOO\��DQG�HFRQRPLFDOO\�

���VHH�:RUOG�:DU����7KH�6HFRQG�RI�LWV�7KUHH�:RHV�3KDVHV�

�1RZ�FDQ�DQ\�WKLQNLQJ�SHUVRQ�GRXEW�WKDW�WKH�LQWULJXH�QRZ

JRLQJ�RQ�LQ�WKH�QHDU�0LGGOH�DQG�)DU�(DVW�LV�GHVLJQHG�WR

DFFRPSOLVK�WKDW�VDWDQLF�REMHFWLYH"�3LNH�KLPVHOI�IRUHWROG�DOO

WKLV�LQ�D�VWDWHPHQW�KH�PDGH�WR�0D]]LQL�RQ�$XJXVW����

������3LNH�VWDWHG�WKDW�DIWHU�:RUOG�:DU�,,,�LV�HQGHG��WKRVH

ZKR�ZLOO�DVSLUH�WR�XQGLVSXWHG�ZRUOG�GRPLQDWLRQ�ZLOO

SURYRNH�WKH�JUHDWHVW�VRFLDO�FDWDFO\VP�WKH�ZRUOG�KDV�HYHU

NQRZQ��4XRWLQJ�KLV�RZQ�ZRUGV�WDNHQ�IURP�WKH�OHWWHU�KH

ZURWH�WR�0D]]LQL�DQG�ZKLFK�OHWWHU�LV�QRZ�FDWDORJXHG�LQ�WKH

%ULWLVK�0XVHXP�LQ�/RQGRQ��(QJODQG��KH�VDLG�

���:H�VKDOO�XQOHDVK�WKH�QLKLOLVWV�DQG�WKH�DWKHLVWV�DQG�ZH

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 19: Fagan Transcript

VKDOO�SURYRNH�D�JUHDW�VRFLDO�FDWDFO\VP�ZKLFK�LQ�DOO�LWV

KRUURU�ZLOO�VKRZ�FOHDUO\�WR�DOO�QDWLRQV�WKH�HIIHFW�RI

DEVROXWH�DWKHLVP��WKH�RULJLQV�RI�VDYDJHU\�DQG�RI�PRVW

EORRG\�WXUPRLO��7KHQ�HYHU\ZKHUH��WKH�SHRSOH�ZLOO�EH

IRUFHG�WR�GHIHQG�WKHPVHOYHV�DJDLQVW�WKH�ZRUOG�PLQRULW\�RI

WKH�ZRUOG�UHYROXWLRQDULHV�DQG�ZLOO�H[WHUPLQDWH�WKRVH

GHVWUR\HUV�RI�FLYLOL]DWLRQ�DQG�WKH�PXOWLWXGHV�GLVLOOXVLRQHG

ZLWK�&KULVWLDQLW\�ZKRVH�VSLULWV�ZLOO�EH�IURP�WKDW�PRPHQW

ZLWKRXW�GLUHFWLRQ�DQG�OHDGHUVKLS�DQG�DQ[LRXV�IRU�DQ�LGHDO�

EXW�ZLWKRXW�NQRZOHGJH�ZKHUH�WR�VHQG�LWV�DGRUDWLRQ��ZLOO

UHFHLYH�WKH�WUXH�OLJKW�WKURXJK�WKH�XQLYHUVDO�PDQLIHVWDWLRQ

RI�WKH�SXUH�GRFWULQH�RI�/XFLIHU�EURXJKW�ILQDOO\�RXW�LQWR

SXEOLF�YLHZ��$�PDQLIHVWDWLRQ�ZKLFK�ZLOO�UHVXOW�IURP�D

JHQHUDO�UHDFWLRQDU\�PRYHPHQW�ZKLFK�ZLOO�IROORZ�WKH

GHVWUXFWLRQ�RI�&KULVWLDQLW\�DQG�$WKHLVP��ERWK�FRQTXHUHG

DQG�H[WHUPLQDWHG�DW�WKH�VDPH�WLPH����:KHQ�0D]]LQL�GLHG

LQ�������3LNH�PDGH�DQRWKHU�UHYROXWLRQDU\�OHDGHU�QDPHG

$GULDQ�/HPP\��KLV�VXFFHVVRU��/HPP\��LQ�WXUQ��ZDV

VXFFHHGHG�E\�/HQLQ�DQG�7URWVN\��WKHQ�E\�6WDOLQ��7KH

UHYROXWLRQDU\�DFWLYLWLHV�RI�DOO�WKRVH�PHQ�ZHUH�ILQDQFHG�E\

%ULWLVK��)UHQFK��*HUPDQ��DQG�$PHULFDQ�LQWHUQDWLRQDO

EDQNHUV��DOO�RI�WKHP�GRPLQDWHG�E\�WKH�+RXVH�RI

5RWKVFKLOG��:H�DUH�VXSSRVHG�WR�EHOLHYH�WKDW�WKH

LQWHUQDWLRQDO�EDQNHUV�RI�WRGD\��OLNH�WKH�PRQH\�FKDQJHUV

RI�&KULVWV�GD\��DUH�RQO\�WKH�WRROV�RU�DJHQWV�RI�WKH�JUHDW

FRQVSLUDF\��EXW�DFWXDOO\�WKH\�DUH�WKH�PDVWHUPLQGV�EHKLQG

DOO�WKH�PDVV�FRPPXQLFDWLRQV�PHGLD�OHDGLQJ�XV�LQWR

EHOLHYLQJ�WKDW�FRPPXQLVP�LV�D�PRYHPHQW�RI�WKH�VR�FDOOHG

ZRUNHUV��WKH�DFWXDO�IDFW�LV�WKDW�ERWK�%ULWLVK�DQG�$PHULFDQ

LQWHOOLJHQFH�RIILFHUV�KDYH�DXWKHQWLF�GRFXPHQWDU\�HYLGHQFH

WKDW�LQWHUQDWLRQDO�OLEHUDOV��RSHUDWLQJ�WKURXJK�WKHLU

LQWHUQDWLRQDO�EDQNLQJ�KRXVHV��SDUWLFXODUO\�WKH�+RXVH�RI

5RWKVFKLOG��KDYH�ILQDQFHG�ERWK�VLGHV�RI�HYHU\�ZDU�DQG

UHYROXWLRQ�VLQFH������

�7KRVH�ZKR�WRGD\�FRPSULVH�WKH�FRQVSLUDF\��WKH�&)5�LQ�WKH

8QLWHG�6WDWHV�DQG�WKH�5,,$�LQ�%ULWDLQ���GLUHFW�RXU

JRYHUQPHQWV�ZKRP�WKH\�KROG�LQ�XVXU\�WKURXJK�VXFK

PHWKRGV�DV�WKH�)HGHUDO�5HVHUYH�6\VWHP�LQ�$PHULFD�WR

ILJKW�ZDUV��VXFK�DV�9LHWQDP��FUHDWHG�E\�WKH�8QLWHG

1DWLRQV���VR�DV�WR�IXUWKHU�3LNHV�,OOXPLQDWL�SODQV�WR�EULQJ

WKH�ZRUOG�WR�WKDW�VWDJH�RI�WKH�FRQVSLUDF\�ZKHQ�DWKHLVWLF�

FRPPXQLVP�DQG�WKH�ZKROH�RI�&KULVWLDQLW\�FDQ�EH�IRUFHG

LQWR�DQ�DOO�RXW�WKLUG�ZRUOG�ZDU�ZLWKLQ�HDFK�UHPDLQLQJ

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 20: Fagan Transcript

QDWLRQ�DV�ZHOO�DV�RQ�DQ�LQWHUQDWLRQDO�EDVLV�VFDOH�

�7KH�KHDGTXDUWHUV�RI�WKH�JUHDW�FRQVSLUDF\�LQ�WKH�ODWH

����V�ZDV�LQ�)UDQNIXUW��*HUPDQ\�ZKHUH�WKH�+RXVH�RI

5RWKVFKLOG�KDG�EHHQ�HVWDEOLVKHG�E\�0D\DU��RU�0D\HU�

$PVFKHO�ZKR�DGRSWHG�WKH�5RWKVFKLOG�QDPH�DQG�OLQNHG

WRJHWKHU�RWKHU�LQWHUQDWLRQDO�ILQDQFLHUV�ZKR�KDG�OLWHUDOO\

VROG�WKHLU�VRXOV�WR�WKH�GHYLO��$IWHU�WKH�%DYDULDQ

JRYHUQPHQWV�H[SRVXUH�LQ�������WKH�FRQVSLUDWRUV�PRYHG

WKHLU�KHDGTXDUWHUV�WR�6ZLW]HUODQG�WKHQ�WR�/RQGRQ��6LQFH

:RUOG�:DU�,,��DIWHU�-DFRE�6FKLII��WKH�5RWKVFKLOGV�ER\�LQ

$PHULFD�GLHG���WKH�KHDGTXDUWHUV�RI�WKH�$PHULFDQ�EUDQFK

KDV�EHHQ�LQ�WKH�+DUROG�3UDWW�%XLOGLQJ�LQ�1HZ�<RUN�&LW\�DQG

WKH�5RFNHIHOOHUV��RULJLQDOO\�SURWHJHV�RI�6FKLII��KDYH�WDNHQ

RYHU�WKH�PDQLSXODWLRQ�RI�ILQDQFHV�LQ�$PHULFD�IRU�WKH

,OOXPLQDWL�

�,Q�WKH�ILQDO�SKDVHV�RI�WKH�FRQVSLUDF\��WKH�RQH�ZRUOG

JRYHUQPHQW�ZLOO�FRQVLVW�RI�WKH�NLQJ�GLFWDWRU��WKH�KHDG�RI

WKH�8QLWHG�1DWLRQV��WKH�&)5��DQG�D�IHZ�ELOOLRQDLUHV�

HFRQRPLVWV��DQG�VFLHQWLVWV�ZKR�KDYH�SURYHG�WKHLU�GHYRWLRQ

WR�WKH�JUHDW�FRQVSLUDF\��$OO�RWKHUV�DUH�WR�EH�LQWHJUDWHG

LQWR�D�YDVW�FRQJORPHUDWLRQ�RI�PRQJUHOL]HG�KXPDQLW\�

DFWXDOO\� VODYHV��1RZ�OHW�PH�VKRZ�\RX�KRZ�RXU�IHGHUDO

JRYHUQPHQW�DQG�WKH�$PHULFDQ�SHRSOH�KDYH�EHHQ�VXFNHG

LQWR�WKH�RQH�ZRUOG�WDNH�RYHU�SORW�RI�WKH�,OOXPLQDWL�JUHDW

FRQVSLUDF\�DQG�DOZD\V�EHDU�LQ�PLQG��WKDW�WKH�8QLWHG

1DWLRQV�ZDV�FUHDWHG�WR�EHFRPH�WKH�KRXVLQJ�IRU�WKDW

RQH�ZRUOG��VR�FDOOHG��OLEHUDO�FRQVSLUDF\��7KH�UHDO

IRXQGDWLRQV�RI�WKH�SORW�RI�WKH�WDNHRYHU�RI�WKH�8QLWHG

6WDWHV�ZHUH�ODLG�GXULQJ�WKH�SHULRG�RI�RXU�&LYLO�:DU��1RW

WKDW�:HLVKDXSW�DQG�WKH�HDUOLHU�PDVWHUPLQGV�KDG�HYHU

RYHUORRNHG�WKH�QHZ�ZRUOG��DV�,�KDYH�SUHYLRXVO\�LQGLFDWHG�

:HLVKDXSW�KDG�KLV�DJHQWV�SODQWHG�RYHU�KHUH�DV�IDU�EDFN�DV

WKH�5HYROXWLRQDU\�:DU�

�,W�ZDV�GXULQJ�WKH�&LYLO�:DU�WKDW�WKH�FRQVSLUDWRUV

ODXQFKHG�WKHLU�ILUVW�FRQFUHWH�HIIRUWV��:H�NQRZ�WKDW�-XGDK

%HQMDPLQ��FKLHI�DGYLVRU�RI�-HIIHUVRQ�'DYLV��ZDV�D

5RWKVFKLOG�DJHQW��:H�DOVR�NQRZ�WKDW�WKHUH�ZHUH

5RWKVFKLOG�DJHQWV�SODQWHG�LQ�$EUDKDP�/LQFROQV�FDELQHW

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 21: Fagan Transcript

ZKR�WULHG�WR�VHOO�KLP�LQWR�D�ILQDQFLDO�GHDOLQJ�ZLWK�WKH

+RXVH�RI�5RWKVFKLOG��%XW�ROG�$EH�VDZ�WKURXJK�WKH�VFKHPH

DQG�EOXQWO\�UHMHFWHG�LW�WKHUHE\�LQFXUULQJ�WKH�XQG\LQJ

HQPLW\�RI�WKH�5RWKVFKLOGV��H[DFWO\�DV�WKH�5XVVLDQ�&]DU�GLG

ZKHQ�KH�WRUSHGRHG�WKHLU�ILUVW�/HDJXH�RI�1DWLRQV�DW�WKH

&RQJUHVV�LQ�9LHQQD��,QYHVWLJDWLRQ�RI�WKH�DVVDVVLQDWLRQ�RI

/LQFROQ�UHYHDOHG�WKDW�WKH�DVVDVVLQ�%RRWK�ZDV�D�PHPEHU�RI

D�VHFUHW�FRQVSLUDWRULDO�JURXS��%HFDXVH�WKHUH�ZHUH�D

QXPEHU�RI�KLJKO\�LPSRUWDQW�JRYHUQPHQW�RIILFLDOV�LQYROYHG�

WKH�QDPH�RI�WKH�JURXS�ZDV�QHYHU�UHYHDOHG�DQG�LW�EHFDPH

D�P\VWHU\��H[DFWO\�DV�WKH�DVVDVVLQDWLRQ�RI�-DFN��-RKQ�)��

.HQQHG\�LV�VWLOO�D�P\VWHU\��%XW�,�DP�VXUH�LW�ZLOO�QRW�UHPDLQ

D�P\VWHU\�IRU�ORQJ��$Q\ZD\��WKH�HQGLQJ�RI�WKH�&LYLO�:DU

GHVWUR\HG�WHPSRUDULO\�DOO�FKDQFHV�RI�WKH�+RXVH�RI

5RWKVFKLOG�WR�JHW�D�FOXWFK�RQ�RXU�PRQH\�V\VWHP��VXFK�DV

WKH\�KDG�DFTXLUHG�LQ�%ULWDLQ�DQG�RWKHU�QDWLRQV�LQ�(XURSH��,

VD\�WHPSRUDULO\�EHFDXVH�WKH�5RWKVFKLOGV�DQG�WKH

PDVWHUPLQGV�RI�WKH�FRQVSLUDF\�QHYHU�TXLW��VR�WKH\�KDG�WR

VWDUW�IURP�VFUDWFK��EXW�WKH\�ORVW�QR�WLPH�LQ�JHWWLQJ

VWDUWHG�

�6KRUWO\�DIWHU�WKH�&LYLO�:DU��D�\RXQJ�LPPLJUDQW��ZKR

FDOOHG�KLPVHOI�-DFRE�+��6FKLII��DUULYHG�LQ�1HZ�<RUN��-DFRE

ZDV�D�\RXQJ�PDQ�ZLWK�D�PLVVLRQ�IRU�WKH�+RXVH�RI

5RWKVFKLOG��-DFRE�ZDV�WKH�VRQ�RI�D� 5DEEL�ZKR�ZDV�ERUQ�LQ

RQH�RI�WKH�5RWKVFKLOGV�KRXVHV�LQ�)UDQNIXUW��*HUPDQ\��,

ZLOO�JR�GHHSO\�LQWR�KLV�EDFNJURXQG��7KH�LPSRUWDQW�SRLQW

ZDV�WKDW�5RWKVFKLOG�UHFRJQL]HG�LQ�KLP��QRW�RQO\�D�SRWHQWLDO

PRQH\�ZL]DUG��EXW�PRUH�LPSRUWDQW��KH�DOVR�VDZ�WKH�ODWHQW

0DFKLDYHOOLDQ�TXDOLWLHV�LQ�-DFRE��WKDW�FRXOG��DV�LW�GLG��PDNH

KLP�DQ�LQYDOXDEOH�IXQFWLRQDU\�LQ�WKH�JUHDW�RQH�ZRUOG

FRQVSLUDF\��$IWHU�D�FRPSDUDWLYHO\�EULHI�WUDLQLQJ�SHULRG�LQ

WKH�5RWKVFKLOGV�/RQGRQ�%DQN��-DFRE�OHIW�IRU�$PHULFD�ZLWK

LQVWUXFWLRQV�WR�EX\�LQWR�D�EDQNLQJ�KRXVH�ZKLFK�ZDV�WR�EH

WKH�VSULQJERDUG�WR�DFTXLUH�FRQWURO�RI�WKH�PRQH\�V\VWHP�RI

WKH�8QLWHG�6WDWHV��$FWXDOO\��-DFRE�FDPH�KHUH�WR�FDUU\�RXW

IRXU�VSHFLILF�DVVLJQPHQWV�

���$QG�PRVW�LPSRUWDQW��ZDV�WR�DFTXLUH�FRQWURO�RI�$PHULFDV

PRQH\�V\VWHP�

���)LQG�GHVLUDEOH�PHQ��ZKR�IRU�D�SULFH��ZRXOG�EH�ZLOOLQJ�WR

VHUYH�DV�VWRRJHV�IRU�WKH�JUHDW�FRQVSLUDF\�DQG�SURPRWH

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 22: Fagan Transcript

WKHP�LQWR�KLJK�SODFHV�LQ�RXU�IHGHUDO�JRYHUQPHQW��RXU

&RQJUHVV��DQG�WKH�8�6��6XSUHPH�&RXUW��DQG�DOO�IHGHUDO

DJHQFLHV��(SKHVLDQV��������.�-�$�9� ��

���&UHDWH�PLQRULW\�JURXS�VWULIH�WKURXJKRXW�WKH�QDWLRQV�

SDUWLFXODUO\�EHWZHHQ�WKH�ZKLWHV�DQG�EODFNV�

���&UHDWH�D�PRYHPHQW�WR�GHVWUR\�UHOLJLRQ�LQ�WKH�8QLWHG

6WDWHV��EXW�&KULVWLDQLW\�WR�EH�WKH�FKLHI�WDUJHW�

�(SKHVLDQV������)RU�ZH�ZUHVWOH�QRW�DJDLQVW�IOHVK�DQG

EORRG��EXW�DJDLQVW�SULQFLSDOLWLHV��DJDLQVW�SRZHUV��DJDLQVW

WKH�UXOHUV�RI�WKH�GDUNQHVV�RI�WKLV�ZRUOG��DJDLQVW�VSLULWXDO

ZLFNHGQHVV�LQ�KLJK�>SODFHV@�

�(DUOLHU�,�VWDWHG�WKDW�-DFRE�6FKLII�FDPH�WR�$PHULFD�ZLWK

RUGHUV�E\�5RWKVFKLOG�WR�FDUU\�RXW�IRXU�VSHFLILF�GLUHFWLYHV�

7KH�ILUVW�DQG�PRVW�LPSRUWDQW�RQH�ZDV�WR�JHW�FRQWURO�RI�WKH

8QLWHG�6WDWHV�PRQH\�V\VWHP��/HWV�WUDFH�6FKLIIV�VWHS�WR

DFFRPSOLVK�WKDW�GLUHFWLYH��$V�D�ILUVW�VWHS�KH�KDG�WR�EX\

LQWR�D�EDQNLQJ�KRXVH��EXW�LW�KDG�WR�EH�WKH�NLQG�RI�D�KRXVH

WKDW�KH�FRXOG�DEVROXWHO\�FRQWURO�DQG�PROG�IRU�WKDW

SULPDU\�REMHFWLYH�RI�HQWUDSSLQJ�RXU�8�6��PRQH\�V\VWHP�

$IWHU�FDUHIXOO\�VFRXWLQJ�DURXQG��-DFRE�ERXJKW�D

SDUWQHUVKLS�LQ�D�ILUP�WKDW�FDOOHG�LWVHOI���.XKQ�DQG�/RHE��

/LNH�6FKLII��.XKQ�DQG�/RHE�ZHUH�LPPLJUDQWV�IURP�*HUPDQ

-HZLVK�JKHWWRV��7KH\�FDPH�WR�WKH�8�6��LQ�WKH�PLG�����V

DQG�ERWK�RI�WKHP�VWDUWHG�WKHLU�EXVLQHVV�FDUHHUV�DV

LWLQHUDQW�SDFN�SHGGOHUV��,Q�WKH�HDUO\�����V��WKH\�SRROHG

WKHLU�LQWHUHVWV�DQG�VHW�XS�D�PHUFKDQGLVH�VWRUH�LQ

/DID\HWWH��,QGLDQD�XQGHU�WKH�ILUP�QDPH�RI��.XKQ�DQG

/RHE��VHUYLFLQJ�WKH�FRYHUHG�ZDJRQ�VHWWOHUV�RQ�WKHLU�ZD\

ZHVW��,Q�WKH�\HDUV�WKDW�IROORZHG��WKH\�VHW�XS�VLPLODU�VWRUHV

LQ�&LQFLQQDWL�DQG�6W��/RXLV��7KHQ�WKH\�DGGHG��SDZQ�

EURNHULQJ��WR�WKHLU�PHUFKDQGLVLQJ�SXUVXLWV��)URP�WKDW�WR

PRQH\�OHQGLQJ�ZDV�D�VKRUW�DQG�TXLFN�VWHS�

�%\�WKH�WLPH�6FKLII�DUULYHG�RQ�WKH�VFHQH���.XKQ�DQG�/RHE�

ZDV�D�ZHOO�NQRZQ�SULYDWH�EDQNLQJ�ILUP�DQG�WKLV�LV�WKH�ILUP

-DFRE�ERXJKW�LQWR��6KRUWO\�DIWHU�KH�EHFDPH�D�SDUWQHU�LQ

�.XKQ�DQG�/RHE���6FKLII�PDUULHG�/RHEV�GDXJKWHU��7HUHVD�

WKHQ�KH�ERXJKW�RXW�.XKQV�LQWHUHVWV�DQG�PRYHG�WKH�ILUP

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 23: Fagan Transcript

WR�1HZ�<RUN�DQG��.XKQ�DQG�/RHE��EHFDPH��.XKQ��/RHE�

DQG�&RPSDQ\���LQWHUQDWLRQDO�EDQNHUV�ZLWK�-DFRE�6FKLII�

DJHQW�RI�WKH�5RWKVFKLOGV��RVWHQVLEO\�WKH�VROH�RZQHU��$QG

WKURXJKRXW�KLV�FDUHHU��WKLV�EOHQG�RI�-XGDV�DQG�0DFKLDYHOOL�

WKH�ILUVW�KHLUDUFK�RI�WKH�,OOXPLQDWLV�JUHDW�FRQVSLUDF\�LQ

$PHULFD��SRVHG�DV�D�JHQHURXV�SKLODQWKURSLVW�DQG�D�PDQ�RI

JUHDW�KROLQHVV��WKH�FRYHU�XS�SROLF\�VHW�IRUWK�E\�WKH

,OOXPLQDWL�

�$V�,�KDYH�VWDWHG��WKH�ILUVW�JUHDW�VWHS�RI�WKH�FRQVSLUDF\

ZDV�WR�EH�WKH�HQWUDSPHQW�RI�RXU�PRQH\�V\VWHP��7R

DFKLHYH�WKDW�REMHFWLYH��6FKLII�KDG�WR�JHW�IXOO�FRRSHUDWLRQ�RI

WKH�WKHQ�ELJ�EDQNHU�HOHPHQWV�LQ�$PHULFD��DQG�WKDW�ZDV

HDVLHU�VDLG�WKDQ�GRQH��(YHQ�LQ�WKRVH�\HDUV��:DOO�6WUHHW

ZDV�WKH�KHDUW�RI�WKH�$PHULFDQ�PRQH\�PDUW�DQG�-�3�

0RUJDQ�ZDV�LWV�GLFWDWRU��1H[W�LQ�OLQH�ZHUH�WKH�'UH[HOV�DQG

WKH�%LGGOHV�RI�3KLODGHOSKLD��$OO�WKH�RWKHU�ILQDQFLHUV��ELJ

DQG�OLWWOH��GDQFHG�WR�WKH�PXVLF�RI�WKRVH�WKUHH�KRXVHV��EXW

SDUWLFXODUO\�WR�WKDW�RI�0RUJDQ��$OO�RI�WKRVH�WKUHH�ZHUH

SURXG��KDXJKW\��DUURJDQW�SRWHQWDWHV�

�)RU�WKH�ILUVW�IHZ�\HDUV��WKH\�YLHZHG�WKH�OLWWOH

EHZKLVNHUHG�PDQ�IURP�WKH�*HUPDQ�JKHWWRV�ZLWK�XWWHU

FRQWHPSW��EXW�-DFRE�NQHZ�KRZ�WR�RYHUFRPH�WKDW��+H

WKUHZ�D�IHZ�5RWKVFKLOG�ERQHV�WR�WKHP��7KH�VDLG�ERQHV

EHLQJ�GLVWULEXWLRQ�LQ�$PHULFD�RI�GHVLUDEOH�(XURSHDQ�VWRFN

DQG�ERQG�LVVXHV��7KHQ�KH�GLVFRYHUHG�WKDW�KH�KDG�D�VWLOO

PRUH�SRWHQW�ZHDSRQ�LQ�KLV�KDQGV�LQ�WKH�IROORZLQJ�

�,W�ZDV�LQ�WKH�GHFDGHV�IROORZLQJ�RXU�&LYLO�:DU�WKDW�RXU

LQGXVWULHV�EHJDQ�WR�EXUJHRQ��:H�KDG�JUHDW�UDLOURDGV�WR

EXLOG��7KH�RLO��PLQLQJ��VWHHO��WH[WLOH�LQGXVWULHV�ZHUH

EXUVWLQJ�RXW�RI�WKHLU�VZDGGOLQJ�FORWKHV��$OO�RI�WKDW�FDOOHG

IRU�YDVW�ILQDQFLQJ��PXFK�RI�WKDW�ILQDQFLQJ�KDG�WR�FRPH

IURP�DEURDG��7KDW�PHDQW�WKH�+RXVH�RI�5RWKVFKLOG�DQG�WKDW

ZDV�ZKHQ�6FKLII�FDPH�LQWR�KLV�RZQ��+H�SOD\HG�D�YHU\

FUDIW\�JDPH��+H�EHFDPH�WKH�SDWURQ�VDLQW�RI�-RKQ�'�

5RFNHIHOOHU��(GZDUG�5��+DUULPDQ��DQG�$QGUHZ�&DUQHJLH�

+H�ILQDQFHG�WKH�6WDQGDUG�2LO�&RPSDQ\�IRU�5RFN\��WKH

5DLOURDG�(PSLUH�IRU�+DUULPDQ��DQG�WKH�6WHHO�(PSLUH�IRU

&DUQHJLH��%XW�LQVWHDG�RI�KRJJLQJ�DOO�WKH�RWKHU�LQGXVWULHV

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 24: Fagan Transcript

IRU�.XKQ��/RHE��DQG�&RPSDQ\��KH�RSHQHG�WKH�GRRUV�RI�WKH

+RXVH�RI�5RWKVFKLOG�WR�0RUJDQ��%LGGOH��DQG�'UH[HO��,Q

WXUQ��5RWKVFKLOG�DUUDQJHG�WKH�VHWWLQJ�XS�RI�/RQGRQ��3DULV�

(XURSHDQ�DQG�RWKHU�EUDQFKHV�IRU�WKRVH�WKUHH��EXW�DOZD\V

LQ�SDUWQHUVKLSV�ZLWK�5RWKVFKLOG�VXERUGLQDWHV�DQG

5RWKVFKLOG�PDGH�LW�YHU\�FOHDU�WR�DOO�WKRVH�PHQ�WKDW�6FKLII

ZDV�WR�EH�WKH�ERVV�LQ�1HZ�<RUN�

�7KXV�DW�WKH�WXUQ�RI�WKH�FHQWXU\�6FKLII�KDG�D�WLJKW�FRQWURO

RI�WKH�HQWLUH�EDQNLQJ�IUDWHUQLW\�RQ�:DOO�6WUHHW�ZKLFK�E\

WKHQ��ZLWK�6FKLIIV�KHOS��LQFOXGHG�/HKPDQ�EURWKHUV�

*ROGPDQ�6DFKV��DQG�RWKHU�LQWHUQDWLRQDOLVW�EDQNV�WKDW

ZKHUH�KHDGHG�E\�PHQ�FKRVHQ�E\�WKH�5RWKVFKLOGV��,Q�VKRUW�

WKDW�PHDQW�FRQWURO�RI�WKH�QDWLRQV�PRQH\�SRZHUV�DQG�KH

ZDV�WKHQ�UHDG\�IRU�WKH�JLDQW�VWHS���WKH�HQWUDSPHQW�RI�RXU

QDWLRQDO�PRQH\�V\VWHP�

�1RZ�XQGHU�RXU�&RQVWLWXWLRQ��DOO�FRQWURO�RI�RXU�PRQH\�

V\VWHP�LV�YHVWHG�VROHO\�LQ�RXU�&RQJUHVV��6FKLIIV�QH[W

LPSRUWDQW�VWHS�ZDV�WR�VHGXFH�RXU�&RQJUHVV�WR�EHWUD\�WKDW

&RQVWLWXWLRQDO�HGLFW�E\�VXUUHQGHULQJ�WKDW�FRQWURO�WR�WKH

KLHUDUFK\�RI�WKH�,OOXPLQDWLV�JUHDW�FRQVSLUDF\��,Q�RUGHU�WR

OHJDOL]H�WKDW�VXUUHQGHU�DQG�WKXV�PDNH�WKH�SHRSOH

SRZHUOHVV�WR�UHVLVW�LW��LW�ZRXOG�EH�QHFHVVDU\�WR�KDYH

&RQJUHVV�HQDFW�VSHFLDO�OHJLVODWLRQ��7R�DFFRPSOLVK�WKDW�

6FKLII�ZRXOG�KDYH�WR�LQILOWUDWH�VWRRJHV�LQWR�ERWK�KRXVHV�RI

&RQJUHVV��6WRRJHV�SRZHUIXO�HQRXJK�WR�UDLOURDG�&RQJUHVV

LQWR�SDVVLQJ�VXFK�OHJLVODWLRQ��(TXDOO\��RU�HYHQ�PRUH

LPSRUWDQW��KH�ZRXOG�KDYH�WR�SODQW�D�VWRRJH�LQ�WKH�:KLWH

+RXVH��D�SUHVLGHQW�WKDW�LV�ZLWKRXW�LQWHJULW\�DQG�ZLWKRXW

VFUXSOHV��ZKR�ZRXOG�VLJQ�WKDW�OHJLVODWLRQ�LQWR�ODZ��7R

DFFRPSOLVK�WKDW�KH�KDG�WR�JHW�FRQWURO�RI�HLWKHU�WKH

5HSXEOLFDQ�RU�WKH�'HPRFUDWLF�3DUW\��7KH�'HPRFUDWLF�3DUW\

ZDV�WKH�PRUH�YXOQHUDEOH��LW�ZDV�WKH�KXQJULHU�RI�WKH�WZR

SDUWLHV��([FHSW�IRU�*URYHU�&OHYHODQG��WKH�'HPRFUDWV�KDG

EHHQ�XQDEOH�WR�ODQG�RQH�RI�WKHLU�PHQ�LQ�WKH�:KLWH�+RXVH

VLQFH�EHIRUH�WKH�&LYLO�:DU��7KHUH�ZHUH�WZR�UHDVRQV�IRU

WKDW�

���3RYHUW\�RI�WKH�3DUW\�

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 25: Fagan Transcript

���7KHUH�ZHUH�FRQVLGHUDEO\�PRUH�5HSXEOLFDQ�PLQGHG

YRWHUV�WKDQ�'HPRFUDWV�

�7KH�SRYHUW\�PDWWHU�ZDV�QRW�D�JUHDW�SUREOHP��EXW�WKH

YRWHU�SUREOHP�ZDV�D�GLIIHUHQW�VWRU\��%XW�DV�,�SUHYLRXVO\

VDLG��6FKLII�ZDV�D�VPDUW�FRRNLH��+HUH�LV�WKH�DWURFLRXV�DQG

PXUGHURXV�PHWKRG�KH�HPSOR\HG�WR�VROYH�WKDW�YRWHU

SUREOHP��+LV�VROXWLRQ�HPSKDVL]HV�KRZ�YHU\�OLWWOH�WKH

-HZLVK�LQWHUQDWLRQDOLVW�EDQNHUV�FDUH�DERXW�WKHLU�RZQ�UDFLDO

EUHWKUHQ�DV�\RX�VKDOO�VHH��6XGGHQO\��DURXQG�������WKHUH

EURNH�RXW�D�QDWLRQZLGH�VHULHV�RI�SRJURPV�LQ�5XVVLD��0DQ\�

PDQ\��WKRXVDQGV�RI�LQQRFHQW�-HZV��PHQ��ZRPHQ��DQG

FKLOGUHQ�ZHUH�VODXJKWHUHG�E\�WKH�&RVVDFNV�DQG�RWKHU

SHDVDQWV��6LPLODU�SRJURPV�ZLWK�VLPLODU�VODXJKWHU�RI

LQQRFHQW�-HZV�EURNH�RXW�LQ�3RODQG��5XPDQLD��DQG

%XOJDULD��$OO�WKRVH�SRJURPV�ZHUH�IRPHQWHG�E\�5RWKVFKLOG

DJHQWV��$V�D�UHVXOW��WKH�-HZLVK�WHUULILHG�UHIXJHHV��IURP�DOO

RI�WKRVH�QDWLRQV��VZDUPHG�LQWR�WKH�8QLWHG�6WDWHV�DQG�WKDW

FRQWLQXHG�WKURXJKRXW�WKH�QH[W�WZR�RU�WKUHH�GHFDGHV�

EHFDXVH�WKH�SRJURPV�ZHUH�FRQWLQXRXV�WKURXJK�DOO�WKRVH

\HDUV��$OO�WKRVH�UHIXJHHV�ZHUH�DLGHG�E\�VHOI�VW\OHG

KXPDQLWDULDQ�FRPPLWWHHV�VHW�XS�E\�6FKLII��WKH

5RWKVFKLOGV��DQG�DOO�WKH�5RWKVFKLOG�DIILOLDWHV�

�,Q�WKH�PDLQ��WKH�UHIXJHHV�VWUHDPHG�LQWR�1HZ�<RUN��EXW

WKH�6FKLII�5RWKVFKLOG�KXPDQLWDULDQ�FRPPLWWHHV�IRXQG

ZD\V�WR�VKXIIOH�PDQ\�RI�WKHP�LQWR�RWKHU�ODUJH�FLWLHV�VXFK

DV�&KLFDJR��%RVWRQ��3KLODGHOSKLD��'HWURLW��/RV�$QJHOHV�

HWF���$OO�RI�WKHP�ZHUH�TXLFNO\�WUDQVIRUPHG�LQWR

�QDWXUDOL]HG�FLWL]HQV��DQG�HGXFDWHG�WR�UHJLVWHU�DV

'HPRFUDWV��7KXV�DOO�RI�WKDW�VR�FDOOHG�PLQRULW\�JURXS

EHFDPH�VROLG�'HPRFUDWLF�YRWHU�EORFNV�LQ�WKHLU

FRPPXQLWLHV��DOO�FRQWUROOHG�DQG�PDQHXYHUHG�E\�WKHLU

VR�FDOOHG�EHQHIDFWRUV��$QG�VKRUWO\�DIWHU�WKH�WXUQ�RI�WKH

FHQWXU\��WKH\�EHFDPH�YLWDO�IDFWRUV�LQ�WKH�SROLWLFDO�OLIH�RI

RXU�QDWLRQ��7KDW�ZDV�RQH�RI�WKH�PHWKRGV�6FKLII�HPSOR\HG

WR�SODQW�PHQ�OLNH�1HOVRQ�$OGULFK�LQ�RXU�6HQDWH�DQG

:RRGURZ�:LOVRQ�LQ�WKH�:KLWH�+RXVH�

�$W�WKLV�SRLQW�OHW�PH�UHPLQG�\RX�RI�DQRWKHU�RQH�RI�WKH

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 26: Fagan Transcript

LPSRUWDQW�MREV�WKDW�ZDV�DVVLJQHG�WR�6FKLII�ZKHQ�KH�ZDV

GLVSDWFKHG�WR�$PHULFD��,�UHIHU�WR�WKH�MRE�RI�GHVWUR\LQJ�WKH

XQLW\�RI�WKH�$PHULFDQ�SHRSOH�E\�FUHDWLQJ�PLQRULW\�JURXSV

DQG�UDFLDO�VWULIH��%\�WKH�SRJURP�GULYHQ�-HZLVK�UHIXJHHV

HQWHULQJ�LQWR�$PHULFD��6FKLII�ZDV�FUHDWLQJ�D�UHDG\�PDGH

PLQRULW\�JURXS�IRU�WKDW�SXUSRVH��%XW�WKH�-HZLVK�SHRSOH��DV

D�ZKROH��PDGH�IHDUIXO�E\�WKH�SRJURPV��FRXOG�QRW�EH

GHSHQGHG�XSRQ�WR�FUHDWH�WKH�YLROHQFH�QHFHVVDU\�WR

GHVWUR\�WKH�XQLW\�RI�WKH�$PHULFDQ�SHRSOH��%XW�ULJKW�ZLWKLQ

$PHULFD��WKHUH�ZDV�DQ�DOUHDG\�PDGH�WR�RUGHU��DOWKRXJK

DV�\HW��D�VOHHSLQJ�PLQRULW\�JURXS��WKH�1HJURHV��ZKR�FRXOG

EH�VSDUNHG�LQWR�VR�FDOOHG�GHPRQVWUDWLRQV��ULRWLQJ��ORRWLQJ�

PXUGHU��DQG�HYHU\�RWKHU�W\SH�RI�ODZOHVVQHVV���DOO�WKDW�ZDV

QHFHVVDU\��ZDV�WR�LQFLWH�DQG�DURXVH�WKHP��7RJHWKHU��WKRVH

WZR�PLQRULW\�JURXSV��SURSHUO\�PDQHXYHUHG��FRXOG�EH�XVHG

WR�FUHDWH�H[DFWO\�WKH��.LQJ�RI�6WULIH��LQ�$PHULFD�WKH

,OOXPLQDWL�ZRXOG�QHHG�WR�DFFRPSOLVK�WKHLU�REMHFWLYH�

�7KXV�DW�WKH�VDPH�WLPH�WKDW�6FKLII�DQG�FR�FRQVSLUDWRUV

ZHUH�OD\LQJ�WKHLU�SODQV�IRU�WKH�HQWUDSPHQW�RI�RXU�PRQH\�

V\VWHP��WKH\�ZHUH�DOVR�SHUIHFWLQJ�SODQV�WR�KLW�WKH

XQVXVSHFWLQJ�$PHULFDQ�SHRSOH�ZLWK�DQ�H[SORVLYH�DQG

WHUULI\LQJ�UDFLDO�XSKHDYDO�WKDW�ZRXOG�WHDU�WKH�SHRSOH�LQWR

KDWH�IUDFWLRQV�DQG�FUHDWH�FKDRV�WKURXJKRXW�WKH�QDWLRQ�

HVSHFLDOO\�RQ�DOO�FROOHJH�DQG�XQLYHUVLW\�FDPSXVHV��DOO

SURWHFWHG�E\�(DUO�:DUUHQ�GHFLVLRQV�DQG�RXU�VR�FDOOHG

OHDGHUV�LQ�:DVKLQJWRQ�'�&���5HPHPEHU�WKH�:DUUHQ

FRPPLVVLRQ�RQ�WKH�DVVDVVLQDWLRQ�RI�3UHVLGHQW�-DFN��-RKQ�

)��.HQQHG\ ���2I�FRXUVH��SHUIHFWLQJ�WKRVH�SODQV�UHTXLUHV

WLPH�DQG�LQILQLWHO\�SDWLHQW�RUJDQL]LQJ�

�127( ��-DFN�.HQQHG\��GXULQJ�KLV�WHUP�RI�RIILFH�DV�WKH

3UHVLGHQW�RI�WKH�8QLWHG�6WDWHV��EHFDPH�D�&KULVWLDQ��,Q�KLV

DWWHPSW�WR��UHSHQW���KH�WULHG�WR�LQIRUP�WKH�SHRSOH�RI�WKLV

1DWLRQ��DW�OHDVW�WZLFH��WKDW�WKH�2IILFH�RI�WKH�3UHVLGHQW�RI

WKH�8QLWHG�6WDWHV�ZDV�EHLQJ�PDQLSXODWHG�E\�WKH

,OOXPLQDWL�&)5��$W�WKH�VDPH�WLPH��KH�SXW�D�VWRS�WR�WKH

�ERUURZLQJ��RI�)HGHUDO�5HVHUYH�1RWHV�IURP�WKH�)HGHUDO

5HVHUYH�%DQN�DQG�EHJDQ�LVVXLQJ�8QLWHG�6WDWHV�1RWHV

�ZKLFK�ZDV�LQWHUHVW�IUHH��RQ�WKH�FUHGLW�RI�WKH�8QLWHG

6WDWHV��,W�ZDV�WKH�LVVXLQJ�RI�WKH�8QLWHG�6WDWHV�1RWHV�WKDW

FDXVHG�-DFN�.HQQHG\�WR�EH��DVVDVVLQDWHG��

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 27: Fagan Transcript

8SRQ�WDNLQJ�WKH�2DWK�RI�2IILFH��/\QGHQ�%��-RKQVRQ

VWRSSHG�WKH�LVVXLQJ�RI�WKH�8QLWHG�6WDWHV�1RWHV�DQG�ZHQW

EDFN�WR�ERUURZLQJ�)HGHUDO�5HVHUYH�%DQN�1RWHV��ZKLFK

ZHUH�ORDQHG�WR�WKH�SHRSOH�RI�WKH�8QLWHG�6WDWHV�DW�WKH

JRLQJ�UDWH�RI�LQWHUHVW�RI�������7KH�8�6��1RWHV��WKDW�ZHUH

LVVXHG�XQGHU�-RKQ�)��.HQQHG\��ZHUH�RI�WKH������VHULHV

ZKLFK�ERUH�D��5HG��VHDO�RQ�WKH�IDFH�RI�WKH��1RWH��

�1RZ�WR�UHPRYH�DOO�GRXEWV��,OO�WDNH�D�IHZ�PRPHQWV�WR�JLYH

\RX�WKH�GRFXPHQWDU\�SURRI�RI�WKLV�UDFLDO�VWULIH�SORW��)LUVW

RI�DOO�WKH\�KDG�WR�FUHDWH�WKH�OHDGHUVKLS�DQG�RUJDQL]DWLRQV

WR�GUDZ�LQ�PLOOLRQV�RI�GXSHV��ERWK�-HZLVK�DQG�1HJURHV�

ZKR�ZRXOG�GR�WKH�GHPRQVWUDWLQJ�DQG�FRPPLW�WKH�ULRWLQJ�

ORRWLQJ��DQG�ODZOHVVQHVV��6R�LQ�������6FKLII��WKH�/HKPDQV�

DQG�RWKHU�FRQVSLUDWRUV��RUJDQL]HG�DQG�VHW�XS�WKH��1DWLRQDO

$VVRFLDWLRQ�IRU�WKH�$GYDQFHPHQW�RI�WKH�&RORXUHG�3HRSOH�

NQRZQ�DV�WKH��1$$&3���7KH�SUHVLGHQWV��GLUHFWRUV��DQG

OHJDO�FRXQFLOV�RI�WKH�1$$&3�ZHUH�DOZD\V��ZKLWH�PHQ�-HZV�

DSSRLQWHG�E\�6FKLII�DQG�WKLV�LV�WKH�FDVH�WR�WKLV�YHU\�GD\

�$EVROXWHO\�WUXH����'DYLG�*���

�7KHQ�LQ�������WKH�6FKLII�JURXS�RUJDQL]HG�WKH��$QWL�

GHIDPDWLRQ�/HDJXH�RI�WKH�%QDL�%ULWK��FRPPRQO\�NQRZQ

DV�WKH��$'/��WR�VHUYH�DV�WKH�JHVWDSR�DQG�KDWFKHW�PDQ

RXWILW�IRU�WKH�HQWLUH�JUHDW�FRQVSLUDF\��7RGD\�WKH�VLQLVWHU

�$'/��PDLQWDLQV�RYHU�������DJHQFLHV�LQ�DOO�SDUWV�RI�RXU

FRXQWU\�DQG�WKH\�DGYLVH�DQG�FRPSOHWHO\�FRQWURO�HYHU\

DFWLRQ�RI�WKH��1$$&3��RU�RI�WKH��8UEDQ�/HDJXH��RI�DOO�WKH

RWKHU�VR�FDOOHG�1HJUR�FLYLO�ULJKWV�RUJDQL]DWLRQV�WKURXJKRXW

WKH�QDWLRQ�LQFOXGLQJ�VXFK�OHDGHUV�DV�0DUWLQ�/XWKHU�.LQJ�

6WRFNHO\�&DUPLFKDHO��%DUQDUG�5XVWLQ��DQG�RWKHUV�RI�WKH

LON��,Q�DGGLWLRQ��WKH��$'/��DFTXLUHG�DEVROXWH�FRQWURO�RI�WKH

DGYHUWLVLQJ�EXGJHWV�RI�PDQ\�GHSDUWPHQW�VWRUHV��KRWHO�

FKDLQV��DQG�79�DQG�5DGLR�LQGXVWULDOLVW�VSRQVRUV��DOVR

DGYHUWLVLQJ�DJHQFLHV�LQ�RUGHU�WR�FRQWURO�SUDFWLFDOO\�DOO�WKH

PDVV�FRPPXQLFDWLRQV�PHGLD�DQG�IRUFH�HYHU\�OR\DO

QHZVSDSHU�WR�VODQW�DQG�IDOVLI\�WKH�QHZV�DQG�WR�IXUWKHU

LQFLWH��DQG��DW�WKH�VDPH�WLPH�FUHDWH�V\PSDWK\�IRU��WKH

ODZOHVVQHVV�DQG�YLROHQFH�RI�WKH�1HJUR�PREV��+HUH�LV

GRFXPHQWDU\�SURRI�RI�WKH�EHJLQQLQJ�RI�WKHLU�GHOLEHUDWH

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 28: Fagan Transcript

SORW�WR�IRPHQW�WKH�1HJURHV�LQWR�DOO�WKHLU�ODZOHVVQHVV�

�$URXQG�������RQH�,VUDHO�=DQJZLOO�ZURWH�D�SOD\�HQWLWOHG

�7KH�0HOWLQJ�3RW���,W�ZDV�VKHHU�SURSDJDQGD�WR�LQFLWH�WKH

1HJURHV�DQG�-HZV�EHFDXVH�WKH�SOD\�SXUSRUWHGO\�YLVXDOL]HG

KRZ�WKH�$PHULFDQ�SHRSOH�ZHUH�GLVFULPLQDWLQJ�DJDLQVW��DQG

SHUVHFXWLQJ�-HZV�DQG�1HJURHV��$W�WKDW�WLPH�QRERG\

VHHPHG�WR�UHDOL]H�WKDW�LW�ZDV�D�SURSDJDQGD�SOD\��,W�ZDV

WKDW�FOHYHUO\�ZULWWHQ��7KH�SURSDJDQGD�ZDV�ZHOO

ZUDSSHG�XS�LQ�WKH�WUXO\�JUHDW�HQWHUWDLQPHQW�LQ�WKH�SOD\

DQG�LW�ZDV�D�ELJ�%URDGZD\�+LW�

�1RZ�LQ�WKRVH�\HDUV��WKH�OHJHQGDU\�'LDPRQG�-LP�%UDG\

XVHG�WR�WKURZ�D�EDQTXHW�DW�WKH�IDPRXV�'HOPRQLFR

5HVWDXUDQW�LQ�1HZ�<RUN�DIWHU�WKH�RSHQLQJ�SHUIRUPDQFH�RI

D�SRSXODU�SOD\��+H�WKUHZ�VXFK�D�SDUW\�IRU�WKH�FDVW�RI��7KH

0HOWLQJ�3RW���LWV�DXWKRU��SURGXFHU��DQG�FKRVHQ�%URDGZD\�

FHOHEULWLHV��%\�WKHQ�,G�DOUHDG\�PDGH�D�SHUVRQDO�PDUN�RQ

WKH�%URDGZD\�7KHDWHU�DQG�ZDV�LQYLWHG�WR�WKDW�SDUW\��7KHUH

,�PHW�*HRUJH�%HUQDUG�6KDZ�DQG�D�-HZLVK�ZULWHU�QDPHG

,VUDHO�&RKHQ��=DQJZLOO��6KDZ��DQG�&RKHQ�ZHUH�WKH�RQHV

ZKR�FUHDWHG�WKH�)DELDQ�6RFLHW\�LQ�(QJODQG�DQG�KDG

ZRUNHG�FORVHO\�ZLWK�D�)UDQNIXUW�-HZ�QDPHG�0RUGLFDL�ZKR

KDG�FKDQJHG�KLV�QDPH�WR�.DUO�0DU[��EXW�UHPHPEHU��DW

WKDW�WLPH�ERWK� 0DU[LVP�DQG�&RPPXQLVP �ZHUH�MXVW

HPHUJLQJ�DQG�QRERG\�SDLG�PXFK�DWWHQWLRQ�WR�HLWKHU�DQG

QRERG\�VXVSHFWHG�WKH�SURSDJDQGD�LQ�WKH�ZULWLQJV�RI�WKRVH

WKUHH�UHDOO\�EULOOLDQW�ZULWHUV�

�$W�WKDW�EDQTXHW��,VUDHO�&RKHQ�WROG�PH�WKDW�KH�ZDV�WKHQ

HQJDJHG�LQ�ZULWLQJ�D�ERRN�ZKLFK�ZDV�WR�EH�D�IROORZ�XS�RQ

=DQJZLOOV��7KH�0HOWLQJ�3RW���7KH�WLWOH�RI�KLV�ERRN�ZDV�WR

EH��$�5DFLDO�3URJUDP�IRU�WKH���WK�&HQWXU\���$W�WKDW�WLPH�,

ZDV�FRPSOHWHO\�DEVRUEHG�E\�P\�ZRUN�DV�D�SOD\ZULJKW��DQG

VLJQLILFDQW�DV�WKDW�WLWOH�ZDV��LWV�UHDO�REMHFWLYH�QHYHU

GDZQHG�RQ�PH�QRU�ZDV�,�LQWHUHVWHG�LQ�UHDGLQJ�WKH�ERRN�

%XW�LW�VXGGHQO\�KLW�PH�ZLWK�WKH�IRUFH�RI�D�K\GURJHQ�ERPE

ZKHQ�,�UHFHLYHG�D�QHZVSDSHU�FOLSSLQJ�RI�DQ�LWHP�SXEOLVKHG

E\�WKH�:DVKLQJWRQ�'�&��(YHQLQJ�6WDU�LQ�0D\�������7KDW

LWHP�ZDV�D�YHUEDWLP�UHSULQW�RI�WKH�IROORZLQJ�H[FHUSW�LQ

,VUDHO�&RKHQV�ERRN��$�5DFLDO�3URJUDP�IRU�WKH���WK

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 29: Fagan Transcript

&HQWXU\��DQG�LW�UHDG�DV�,�TXRWH�

���:H�PXVW�UHDOL]H�WKDW�RXU�SDUW\V�PRVW�SRZHUIXO�ZHDSRQ

LV�UDFLDO�WHQVLRQ��%\�SURSRXQGLQJ�LQWR�WKH�FRQVFLRXVQHVV�RI

WKH�GDUN�UDFHV��WKDW�IRU�FHQWXULHV�WKH\�KDYH�EHHQ

RSSUHVVHG�E\�WKH�ZKLWHV��ZH�FDQ�PRYH�WKHP�WR�WKH

SURJUDP�RI�WKH�FRPPXQLVW�SDUW\��,Q�$PHULFD��ZH�ZLOO�DLP

IRU�VXEWOH�YLFWRU\��:KLOH�LQIODPLQJ�WKH�1HJUR�PLQRULW\

DJDLQVW�WKH�ZKLWHV��ZH�ZLOO�LQVWLOO�LQ�WKH�ZKLWHV�D�JXLOW�

FRPSOH[�IRU�WKHLU�H[SORLWDWLRQ�RI�WKH�1HJURHV��:H�ZLOO�DLG

WKH�1HJURHV�WR�ULVH�WR�SURPLQHQFH�LQ�HYHU\�ZDON�RI�OLIH��LQ

WKH�SURIHVVLRQV��DQG�LQ�WKH�ZRUOG�RI�VSRUWV�DQG

HQWHUWDLQPHQW��:LWK�WKLV�SUHVWLJH��WKH�1HJUR�ZLOO�EH�DEOH

WR�LQWHUPDUU\�ZLWK�WKH�ZKLWHV�DQG�EHJLQ�D�SURFHVV�ZKLFK

ZLOO�GHOLYHU�$PHULFD�WR�RXU�FDXVH���5HFRUG�RI�-XQH���

������E\�5HSUHVHQWDWLYH�7KRPDV�*��$EHUQHWK\�

�7KXV�WKH�DXWKHQWLFLW\�RI�WKDW�SDVVDJH�LQ�&RKHQV�ERRN

ZDV�IXOO\�HVWDEOLVKHG��%XW�WKH�RQH�TXHVWLRQ�WKDW�UHPDLQHG

LQ�P\�PLQG�ZDV�ZKHWKHU�LW�UHSUHVHQWHG�WKH�RIILFLDO�SROLF\

RU�SORW�RI�WKH�&RPPXQLVW�3DUW\�RU�MXVW�D�SHUVRQDO

H[SUHVVLRQ�RI�&RKHQ�KLPVHOI��+HQFH�,�VRXJKW�PRUH�SURRI

DQG�,�IRXQG�LW�LQ�DQ�RIILFLDO�SDPSKOHW�SXEOLVKHG�LQ������E\

WKH�1HZ�<RUN�&RPPXQLVW�3DUW\V�RIILFLDO�:RUNHUV�/LEUDU\

3XEOLVKHUV��7KDW�SDPSKOHW�ZDV�HQWLWOHG���7KH�1HJURHV�LQ�D

6RYLHW�$PHULFD���,W�XUJHG�WKH�1HJURHV�WR�ULVH�XS��IRUP�D

VRYLHW�VWDWH�LQ�WKH�VRXWK��DQG�DSSO\�IRU�DGPLVVLRQ�WR�WKH

6RYLHW�8QLRQ��,W�FRQWDLQHG�D�ILUP�SOHGJH�WKDW�WKH�UHYROW

ZRXOG�EH�VXSSRUWHG�E\�DOO�$PHULFDQ��UHGV��DQG�DOO

VR�FDOOHG��OLEHUDOV���2Q�SDJH�����LW�SURPLVHG�WKDW�D�6RYLHW

JRYHUQPHQW�ZRXOG�FRQIHU�JUHDWHU�EHQHILWV�WR�1HJURHV�WKDQ

WR�ZKLWHV�DQG�DJDLQ�WKLV�RIILFLDO�FRPPXQLVW�SDPSKOHW

SOHGJHG�WKDW��,�TXRWH���DQ\�DFW�RI�GLVFULPLQDWLRQ�RU

SUHMXGLFH�DJDLQVW�D�1HJUR�ZLOO�EHFRPH�D�FULPH�XQGHU�WKH

UHYROXWLRQDU\�ODZ���7KDW�VWDWHPHQW�SURYHG�WKDW�WKH

H[FHUSW�LQ�,VUDHO�&RKHQV�ERRN�SXEOLVKHG�LQ������ZDV�DQ

RIILFLDO�HGLFW�RI�WKH�&RPPXQLVW�3DUW\�DQG�GLUHFWO\�LQ�OLQH

ZLWK�WKH�,OOXPLQDWL�EOXHSULQW�IRU�ZRUOG�UHYROXWLRQ�LVVXHG

E\�:HLVKDXSW�DQG�ODWHU�E\�$OEHUW�3LNH�

�1RZ�WKHUHV�RQO\�RQH�TXHVWLRQ�DQG�WKDW�LV�WR�SURYH�WKDW

WKH�FRPPXQLVW�UHJLPH�LV�GLUHFWO\�FRQWUROOHG�E\�WKH

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 30: Fagan Transcript

$PHULFDQ�-DFRE�6FKLII�DQG�/RQGRQ�5RWKVFKLOG�PDVWHUPLQGV

RI�WKH�JUHDW�FRQVSLUDF\��$�OLWWOH�ODWHU�,�ZLOO�SURYLGH�WKDW

SURRI�WKDW�ZLOO�UHPRYH�HYHQ�D�UHPRWH�GRXEW�WKDW�WKH

&RPPXQLVW�3DUW\��DV�ZH�NQRZ�LW��ZDV�FUHDWHG�E\�WKRVH

PDVWHUPLQGV��FDSLWDOLVWV�LI�\RX�ZLOO�QRWH���6FKLII��WKH

:DUEXUJV��DQG�WKH�5RWKVFKLOGV�WKDW�SODQQHG�DQG�ILQDQFHG

WKH�HQWLUH�5XVVLDQ�5HYROXWLRQ��WKH�PXUGHU�RI�WKH�&]DU�DQG

KLV�IDPLO\��DQG�WKDW�/HQLQ��7URWVN\��DQG�6WDOLQ�WRRN�WKHLU

RUGHUV�GLUHFWO\�IURP�6FKLII�DQG�WKH�RWKHU�FDSLWDOLVWV�ZKRP

WKH\�VXSSRVHGO\�DUH�ILJKWLQJ�

�1RZ�FDQ�\RX�VHH�ZK\�WKH�YLOH�(DUO�:DUUHQ�DQG�KLV

HTXDOO\�YLOH�FR�6XSUHPH�&RXUW�MXVWLFHV�LVVXHG�WKDW

LQIDPRXV�DQG�WUHDVRQRXV�GHVHJUHJDWLRQ�GHFLVLRQ�LQ�����"

,W�ZDV�WR�DLG�DQG�DEHW�WKH�SORW�RI�WKH�,OOXPLQDWL

FRQVSLUDWRUV�WR�FUHDWH�WHQVLRQ�DQG�VWULIH�EHWZHHQ�WKH

1HJURHV�DQG�:KLWHV��&DQ�\RX�VHH�ZK\�WKH�VDPH�(DUO

:DUUHQ�LVVXHG�KLV�GHFLVLRQ�SURKLELWLQJ�&KULVWLDQ�SUD\HUV

DQG�&KULVWPDV�FDUROV�LQ�RXU�VFKRROV"�:K\�.HQQHG\�GLG

OLNHZLVH"�$QG�FDQ�\RX�VHH�ZK\�-RKQVRQ�DQG����6HQDWRUV�

GHVSLWH�WKH�SURWHVWV�RI�����RI�WKH�$PHULFDQ�SHRSOH��YRWHG

IRU�WKH��&RQVXODU�7UHDW\��ZKLFK�RSHQV�RXU�HQWLUH�FRXQWU\

WR�5XVVLDQ�VSLHV�DQG�VDERWHXUV"�$OO�WKRVH����6HQDWRUV�DUH

��WK�FHQWXU\�%HQHGLFW�$UQROGV�

�,W�LV�XS�WR�\RX�DQG�\RX��DOO�RI�WKH�$PHULFDQ�SHRSOH��WR

IRUFH�&RQJUHVV��RXU�HOHFWHG�VHUYDQWV��WR�KDXO�LQ�WKRVH

$PHULFDQ�WUDLWRUV�IRU�LPSHDFKPHQWV�DQG�WKDW�ZKHQ�SURYHQ

JXLOW\��WKH\�DOO�EH�JLYHQ�WKH�SXQLVKPHQW�SUHVFULEHG�IRU

WUDLWRUV�ZKR�DLG�DQG�DEHW�RXU�HQHPLHV��$QG�WKDW�LQFOXGHV

WKH�HQIRUFLQJ�RI�ULJLG�LQYHVWLJDWLRQV�E\�&RQJUHVV�RI�WKH

�&)5��DQG�DOO�WKHLU�IURQWV��VXFK�DV�WKH��$'/���WKH��1$$&3��

�61,&���DQG�VXFK�,OOXPLQDWL�WRROV�DV�0DUWLQ�/XWKHU�.LQJ �

6XFK�LQYHVWLJDWLRQV�ZLOO�FRPSOHWHO\�XQPDVN�DOO�WKH�OHDGHUV

LQ�:DVKLQJWRQ��'�&��DQG�WKH�,OOXPLQDWL�DQG�DOO�WKHLU

DIILOLDWLRQV�DQG�DIILOLDWHV�DV�WUDLWRUV�FDUU\LQJ�RXW�WKH

,OOXPLQDWL�SORW��,W�ZLOO�FRPSOHWHO\�XQPDVN�WKH�8QLWHG

1DWLRQV�DV�WKH�LQWHQGHG�FUX[�RI�WKH�HQWLUH�SORW�DQG�IRUFH

&RQJUHVV�WR�WDNH�WKH�8�6��RXW�RI�WKH�8�1��DQG�KXUO�WKH

8�1��RXW�RI�WKH�8�6���,Q�IDFW��LW�ZLOO�GHVWUR\�WKH�8�1��DQG

WKH�HQWLUH�SORW�

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 31: Fagan Transcript

�,�PXVW�SRLQW�RXW�DW�WKLV�SRLQW�WKDW�,��-$+��DP�LQ�12�ZD\

D�UDFLVW�DQG�WKDW�WKLV�DXWKRUV�RSLQLRQ�RI�0DUWLQ�/XWKHU

.LQJ�LV� KLV�DQG� QRW�PLQH��,�DP�FRORXU�EOLQG�LQ�UHJDUG�WR

UDFLDO�LVVXHV�

�%HIRUH�,�FORVH�WKLV�SKDVH��,�ZLVK�WR�UHLWHUDWH�DQG�VWUHVV

RQH�YLWDO�SRLQW�ZKLFK�,�XUJH�\RX�WR�QHYHU�IRUJHW�LI�\RX

ZLVK�WR�VDYH�RXU�FRXQWU\�IRU�\RXU�FKLOGUHQ�DQG�WKHLU

FKLOGUHQ��+HUH�LV�WKH�SRLQW��(YHU\�XQFRQVWLWXWLRQDO�DQG

XQODZIXO�DFW�FRPPLWWHG�E\�:RRGURZ�:LOVRQ��E\�)UDQNOLQ

5RRVHYHOW��E\�7UXPDQ��(LVHQKRZHU��DQG�.HQQHG\�DQG�WKDW

DUH�QRZ�EHLQJ�FRPPLWWHG�E\�-RKQVRQ��DQG�WRGD\��*HRUJH

%XVK�DQG�%LOO�&OLQWRQ��LV�H[DFWO\�LQ�OLQH�ZLWK�WKH�,OOXPLQDWL

FRQVSLUDWRUV�FHQWXULHV�ROG�SORW�RXWOLQHG�E\�:HLVKDXSW�DQG

$OEHUW�3LNH��(YHU\�YLFLRXV�GHFLVLRQ�LVVXHG�E\�WKH�WUDLWRURXV

(DUO�:DUUHQ�DQG�KLV�HTXDOO\�WUDLWRURXV�6XSUHPH�&RXUW

MXVWLFHV�ZDV�GLUHFWO\�LQ�OLQH�ZLWK�ZKDW�WKH�,OOXPLQDWL�

EOXHSULQW�UHTXLUHG��7KDW�DOO�WKH�WUHDVRQ�FRPPLWWHG�E\�RXU

6WDWH�'HSDUWPHQW�XQGHU�5XVN�DQG�HDUOLHU�E\�-RKQ�)RVWHU

'XOOHV��DQG�0DUVKDOO��DOVR�DOO�WKH�WUHDVRQ�FRPPLWWHG�E\

0F1DPDUD�DQG�KLV�SUHGHFHVVRUV�LV�GLUHFWO\�LQ�OLQH�ZLWK�WKDW

VDPH�,OOXPLQDWL�EOXHSULQW�IRU�WKH�WDNHRYHU�RI�WKH�ZRUOG�

$OVR�WKH�DPD]LQJ�WUHDVRQ�E\�YDULRXV�PHPEHUV�RI�RXU

&RQJUHVV��HVSHFLDOO\�E\�WKH����6HQDWRUV�ZKR�VLJQHG�IRU

WKH�&RQVXODU�7UHDW\��KDV�EHHQ�FRPPLWWHG�RQ�RUGHUV�IURP

WKH�,OOXPLQDWL�

�1RZ�,�ZLOO�JR�EDFN�WR�-DFRE�6FKLIIV�HQWUDSPHQW�RI�RXU

PRQH\�V\VWHP�DQG�WKH�WUHDVRQRXV�DFWLRQV�WKDW�IROORZHG��,W

ZLOO�DOVR�UHYHDO�WKH�6FKLII�5RWKVFKLOG�FRQWURO�RI�QRW�RQO\

.DUO�0DU[��EXW�RI�/HQLQ��7URWVN\��DQG�6WDOLQ��ZKR�FUHDWHG

WKH�UHYROXWLRQ�LQ�5XVVLD�DQG�VHW�XS�WKH�&RPPXQLVW�3DUW\�

�,W�ZDV�LQ������WKDW�6FKLII�GHFLGHG�WKDW�WKH�WLPH�KDG�FRPH

IRU�KLV�VHL]XUH�RI�RXU�PRQH\�V\VWHP��+LV�FKLHI�OLHXWHQDQWV

LQ�WKDW�VHL]XUH�ZHUH�&RORQHO�(GZDUG�0DQGHOO�+RXVH�ZKRVH

HQWLUH�FDUHHU�ZDV�WKDW�RI�FKLHI�H[HFXWLYH�DQG�FRXULHU�IRU

6FKLII�DV�,�VKDOO�VKRZ�DQG�%HUQDUG�%HURXN�DQG�+HUEHUW

/HKPDQ��,Q�WKH�)DOO�� $XWXPQ��RI�WKDW�\HDU��WKH\

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 32: Fagan Transcript

DVVHPEOHG�LQ�VHFUHW�FRQFODYH�DW�WKH�-HFNOH�,VODQG�+XQW

&OXE��RZQHG�E\�-�3��0RUJDQ�DW�-HFNOH�,VODQG��*HRUJLD�

$PRQJ�WKRVH�SUHVHQW�ZHUH�-�3��0RUJDQ��-RKQ�%�

5RFNHIHOOHU��&RORQHO�+RXVH��6HQDWRU�1HOVRQ�$OGULFK��6FKLII�

6WLOOPDQ�DQG�9DQGOHOLS�RI�WKH�1HZ�<RUN�1DWLRQDO�&LW\

%DQN��:��DQG�-��6HOLJPDQ��(XJHQH�0\HU��%HUQDUG�%HURXN�

+HUEHUW�/HKPDQ��3DXO�:DUEXUJ��LQ�VKRUW��DOO�RI�WKH

LQWHUQDWLRQDO�EDQNHUV�LQ�$PHULFD��$OO�RI�WKHP�PHPEHUV�RI

WKH�KLHUDUFK\�RI�WKH�,OOXPLQDWLV�JUHDW�FRQVSLUDF\�

�$�ZHHN�ODWHU�WKH\�HPHUJHG�ZLWK�ZKDW�WKH\�FDOOHG�WKH

)HGHUDO�5HVHUYH�6\VWHP��6HQDWRU�$OGULFK�ZDV�WKH�VWRRJH

ZKR�ZDV�WR�UDLOURDG�LW�WKURXJK�&RQJUHVV��EXW�WKH\�KHOG

WKDW�UDLOURDGLQJ�LQ�DEH\DQFH�IRU�RQH�FKLHI�UHDVRQ��WKH\

ZRXOG�ILUVW�KDYH�WR�SODQW�WKHLU�PDQ�DQG�REHGLHQW�VWRRJH�LQ

WKH�:KLWH�+RXVH�WR�VLJQ�WKH�)HGHUDO�5HVHUYH�$FW�LQWR�ODZ�

7KH\�NQHZ�WKDW�HYHQ�LI�WKH�6HQDWH�ZRXOG�SDVV�WKDW�DFW

XQDQLPRXVO\��WKH�WKHQ�QHZO\�HOHFWHG�3UHVLGHQW�7DIW�ZRXOG

SURPSWO\�YHWR�LW��6R�WKH\�ZDLWHG�

�,Q�������WKHLU�PDQ��:RRGURZ�:LOVRQ��ZDV�HOHFWHG�WR�WKH

SUHVLGHQF\��,PPHGLDWHO\�DIWHU�:LOVRQ�ZDV�LQDXJXUDWHG�

6HQDWRU�$OGULFK�UDLOURDGHG�WKH�)HGHUDO�5HVHUYH�$FW

WKURXJK�ERWK�KRXVHV�RI�&RQJUHVV�DQG�:LOVRQ�SURPSWO\

VLJQHG�LW�DQG�WKH�)HGHUDO�5HVHUYH�$FW�EHFDPH�ODZ��7KDW

KHLQRXV�DFW�RI�WUHDVRQ�ZDV�FRPPLWWHG�RQ�'HFHPEHU����

������WZR�GD\V�EHIRUH�&KULVWPDV�ZKHQ�DOO�WKH�PHPEHUV�RI

&RQJUHVV��H[FHSW�IRU�VHYHUDO�FDUHIXOO\�SLFNHG

5HSUHVHQWDWLYHV�DQG�WKUHH�HTXDOO\�FDUHIXOO\�SLFNHG

6HQDWRUV��ZHUH�DZD\�IURP�:DVKLQJWRQ��+RZ�KHLQRXV

WUHDVRQRXV�ZDV�WKDW�DFW"�,OO�WHOO�\RX��2XU�IRXQGLQJ�IDWKHUV

NQHZ�IXOO�ZHOO�WKH�SRZHU�RI�PRQH\��7KH\�NQHZ�WKDW

ZKRHYHU�KDG�WKDW�SRZHU�KHOG�WKH�GHVWLQ\�RI�RXU�QDWLRQ�LQ

KLV�KDQGV��7KHUHIRUH��WKH\�FDUHIXOO\�JXDUGHG�WKLV�SRZHU

ZKHQ�WKH\�VHW�IRUWK�LQ�WKH�&RQVWLWXWLRQ��WKDW�&RQJUHVV��WKH

HOHFWHG�UHSUHVHQWDWLYHV�RI�WKH�SHRSOH��DORQH�ZRXOG�KDYH

WKH�SRZHU��7KH�&RQVWLWXWLRQDO�ODQJXDJH�RQ�WKLV�SRLQW�LV

EULHI��FRQFLVH��DQG�VSHFLILF��VWDWHG�LQ�$UWLFOH�,��6HFWLRQ���

3DUDJUDSK����GHILQLQJ�WKH�GXWLHV�DQG�SRZHUV�RI�&RQJUHVV�

DQG�,�TXRWH���WR�FRLQ�PRQH\��UHJXODWH�WKH�YDOXH�WKHUHRI�

DQG�RI�IRUHLJQ�FRLQ��DQG�WKH�VWDQGDUG�RI�ZHLJKWV�DQG

PHDVXUHV���%XW�RQ�WKDW�WUDJLF��XQIRUJHWWDEOH�GD\�RI

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 33: Fagan Transcript

LQIDP\��'HFHPEHU�����������WKH�PHQ�ZH�VHQW�WR

:DVKLQJWRQ�WR�VDIHJXDUG�RXU�LQWHUHVWV��WKH

5HSUHVHQWDWLYHV��6HQDWRUV��DQG�:RRGURZ�:LOVRQ�

GHOLYHUHG�WKH�GHVWLQ\�RI�RXU�QDWLRQ�LQWR�WKH�KDQGV�RI�WZR

DOLHQV�IURP�(DVWHUQ�(XURSH��-DFRE�6FKLII�DQG�3DXO

:DUEXUJ��:DUEXUJ�ZDV�D�YHU\�UHFHQW�LPPLJUDQW�ZKR�FDPH

KHUH�RQ�RUGHUV�IURP�5RWKVFKLOG�IRU�WKH�H[SUHVV�SXUSRVH�RI

EOXHSULQWLQJ�WKDW�IRXO�)HGHUDO�5HVHUYH�$FW�

�1RZ�WKH�YDVW�PDMRULW\�RI�WKH�$PHULFDQ�SHRSOH�WKLQN�WKDW

WKH�)HGHUDO�5HVHUYH�6\VWHP�LV�DQ�8QLWHG�6WDWHV

*RYHUQPHQW�RZQHG�DJHQF\��7KDW�LV�SRVLWLYHO\�IDOVH��$OO�RI

WKH�VWRFN�RI�WKH�IHGHUDO�UHVHUYH�EDQNV�LV�RZQHG�E\�WKH

PHPEHU�EDQNV�DQG�WKH�KHDGV�RI�WKH�PHPEHU�EDQNV�DUH�DOO

PHPEHUV�RI�WKH�KLHUDUFK\�RI�WKH�JUHDW�,OOXPLQDWL

FRQVSLUDF\�NQRZQ�WRGD\�DV�WKH��&)5��

�7KH�GHWDLOV�RI�WKDW�DFW�RI�WUHDVRQ��LQ�ZKLFK�PDQ\

WUDLWRURXV�VR�FDOOHG�$PHULFDQV�SDUWLFLSDWHG��DUH�IDU�WRR

ORQJ�IRU�WKLV�UHSRUWLQJ��EXW�DOO�WKRVH�GHWDLOV�DUH�DYDLODEOH

LQ�D�ERRN�HQWLWOHG���7KH�)HGHUDO�5HVHUYH�&RQVSLUDF\��

ZULWWHQ�E\�(XVWDFH�0XOOLQV��,Q�WKDW�ERRN��0XOOLQV�WHOOV�WKH

HQWLUH�KRUULI\LQJ�VWRU\�DQG�EDFNV�LW�XS�ZLWK�XQTXHVWLRQDEOH

GRFXPHQWDWLRQV��$VLGH�IURP�LW�EHLQJ�D�WUXO\�IDVFLQDWLQJ

DQG�VKRFNLQJ�VWRU\�RI�WKDW�JUHDW�EHWUD\DO��HYHU\�$PHULFDQ

VKRXOG�UHDG�LW�DV�D�PDWWHU�RI�YLWDO�LQWHOOLJHQFH�IRU�WKH�WLPH

ZKHQ�WKH�ZKROH�$PHULFDQ�SHRSOH�ZLOO�ILQDOO\�FRPH�DZDNH

DQG�VPDVK�WKH�HQWLUH�FRQVSLUDF\�DQG�ZLWK�*RGV�KHOS��WKDW

DZDNHQLQJ�ZLOO�VXUHO\�FRPH�

.LQJ�RI�NLQJV�%LEOH��

'DQLHO������$QG�PDQ\�RI�WKHP�WKDW�VOHHS�LQ� �WKH�GXVW�RI

WKH�HDUWK� ��*HQ����������������VKDOO�DZDNH��VRPH�WR

(YHUODVWLQJ�/LIH��DQG�VRPH�WR�VKDPH�>DQG@�HYHUODVWLQJ

FRQWHPSW�

�1RZ�LI�\RX�WKLQN�WKDW�WKRVH�DOLHQV�DQG�WKHLU�E\�DFFLGHQW�

RI�ELUWK�$PHULFDQ�FR�FRQVSLUDWRUV�ZRXOG�EH�FRQWHQW�ZLWK

MXVW�WKH�FRQWURO�RI�RXU�PRQH\�V\VWHP��\RX�DUH�LQ�IRU

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 34: Fagan Transcript

DQRWKHU�YHU\�VDG�VKRFN��7KH�)HGHUDO�5HVHUYH�6\VWHP�JDYH

WKH�FRQVSLUDWRUV�FRPSOHWH�FRQWURO�RI�RXU�PRQH\�V\VWHP�

EXW�LW�LQ�QR�ZD\�WRXFKHG�WKH�HDUQLQJV�RI�WKH�SHRSOH

EHFDXVH�WKH�&RQVWLWXWLRQ�SRVLWLYHO\�IRUELGV�ZKDW�LV�QRZ

NQRZQ�DV�WKH������ZLWKKROGLQJ�WD[��%XW�WKH�,OOXPLQDWL�

EOXHSULQW�IRU� RQH�ZRUOG�HQVODYHPHQW �FDOOHG�IRU�WKH

FRQILVFDWLRQ�RI�DOO�SULYDWH�SURSHUW\�DQG�FRQWURO�RI

LQGLYLGXDO�HDUQLQJ�SRZHUV��7KLV��DQG�.DUO�0DU[�VWUHVVHG

WKDW�IHDWXUH�LQ�KLV�EOXHSULQW��KDG�WR�EH�DFFRPSOLVKHG�E\�D

SURJUHVVLYH�JUDGXDWHG�LQFRPH�WD[��$V�,�KDYH�VWDWHG��VXFK

D�WD[�FRXOG�QRW�ODZIXOO\�EH�LPSRVHG�XSRQ�WKH�$PHULFDQ

SHRSOH��,W�LV�VXFFLQFWO\�DQG�H[SUHVVO\�IRUELGGHQ�E\�RXU

&RQVWLWXWLRQ��7KXV��RQO\�DQ�$PHQGPHQW�WR�WKH

&RQVWLWXWLRQ�FRXOG�JLYH�WKH�IHGHUDO�JRYHUQPHQW�VXFK

FRQILVFDWRU\�SRZHUV�

�:HOO��WKDW�WRR�ZDV�QRW�DQ�LQVXUPRXQWDEOH�SUREOHP�IRU�RXU

0DFKLDYHOOLDQ�SORWWHUV��7KH�VDPH�HOHFWHG�OHDGHUV�LQ�ERWK

KRXVHV�RI�&RQJUHVV�DQG�WKH�VDPH�0U��:RRGURZ�:LOVRQ�

ZKR�VLJQHG�WKH�LQIDPRXV�)HGHUDO�5HVHUYH�$FW�LQWR�ODZ�

DPHQGHG�WKH�&RQVWLWXWLRQ�WR�PDNH�WKH�IHGHUDO�LQFRPH�WD[�

NQRZQ�DV�WKH���WK�$PHQGPHQW��D�ODZ�RI�WKH�ODQG��%RWK

DUH�LOOHJDO�XQGHU�RXU�&RQVWLWXWLRQ��,Q�VKRUW��WKH�VDPH

WUDLWRUV�VLJQHG�ERWK�EHWUD\DOV��WKH�)HGHUDO�5HVHUYH�$FW

DQG�WKH���WK�$PHQGPHQW��LQWR�ODZ��+RZHYHU��LW�VHHPV

WKDW�QRERG\�HYHU�UHDOL]HG�WKDW�WKH���WK�DPHQGPHQW�ZDV

VHW�XS�WR�URE��DQG�,�GR�PHDQ�URE��WKH�SHRSOH�RI�WKHLU

HDUQLQJV�YLD�WKH�LQFRPH�WD[�SURYLVLRQ�

�7KH�SORWWHUV�GLGQW�IXOO\�XVH�WKH�SURYLVLRQ�XQWLO�:RUOG�:DU

,,�ZKHQ�WKDW�JUHDW�KXPDQLWDULDQ��)UDQNOLQ�5RRVHYHOW�

DSSOLHG�D�����ZLWKKROGLQJ�WD[�RQ�DOO�VPDOO�ZDJH�HDUQHUV

DQG�XS�WR�����RQ�KLJKHU�LQFRPHV��2K��RI�FRXUVH��KH

IDLWKIXOO\�SURPLVHG�WKDW�LW�ZRXOG�EH�RQO\�IRU�WKH�GXUDWLRQ

RI�WKH�ZDU��EXW�ZKDW�ZDV�D�SURPLVH�WR�VXFK�D�FKDUODWDQ

ZKR�LQ�������ZKHQ�KH�ZDV�UXQQLQJ�IRU�KLV�WKLUG�WHUP��NHSW

SURFODLPLQJ���,�VD\�DJDLQ�DQG�DJDLQ�DQG�DJDLQ�WKDW�,�ZLOO

QHYHU�VHQG�$PHULFDQ�ER\V�WR�ILJKW�RQ�IRUHLJQ�VRLO��

5HPHPEHU��KH�ZDV�SURFODLPLQJ�WKDW�VWDWHPHQW�HYHQ�DV�KH

ZDV�DOUHDG\�SUHSDULQJ�WR�SOXQJH�XV�LQWR�:RUOG�:DU�,,�E\

HQWLFLQJ�WKH�-DSDQHVH�LQWR�WKDW�VQHDN�DWWDFN�RQ�3HDUO

+DUERU�WR�IXUQLVK�KLP�ZLWK�KLV�H[FXVH�

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 35: Fagan Transcript

�$QG�EHIRUH�,�IRUJHW��OHW�PH�UHPLQG�\RX�WKDW�DQRWKHU

FKDUODWDQ�QDPHG�:RRGURZ�:LOVRQ�XVHG�H[DFWO\�WKDW�VDPH

FDPSDLJQ�VORJDQ�LQ�������+LV�VORJDQ�ZDV���5H�HOHFW�WKH

PDQ�ZKR�ZLOO�NHHS�\RXU�VRQV�RXW�RI�WKH�ZDU���H[DFWO\�WKH

VDPH�IRUPXOD��H[DFWO\�WKH�VDPH�SURPLVHV��%XW�ZDLW��DV�$O

-ROVRQ�XVHG�WR�VD\���\RX�DLQW�KHDUG�QRWKLQ�\HW���7KDW

��WK�$PHQGPHQW�LQFRPH�WD[�WUDS�ZDV�LQWHQGHG�WR

FRQILVFDWH�DQG�URE�WKH�HDUQLQJV�RI�WKH�FRPPRQ�KHUG��\RX

DQG�PH��,W�ZDV�QRW�LQWHQGHG�WR�HYHQ�WRXFK�WKH�KXJH

LQFRPHV�RI�WKH�,OOXPLQDWL�JDQJ��WKH�5RFNHIHOOHUV��WKH

&DUQHJLHV��WKH�/HKPDQV��DQG�DOO�WKH�RWKHU�FRQVSLUDWRUV�

�6R�WRJHWKHU��ZLWK�WKDW���WK�$PHQGPHQW��WKH\�FUHDWHG

ZKDW�WKH\�FDOOHG�WKH��WD[�IUHH�IRXQGDWLRQV��WKDW�ZRXOG

HQDEOH�WKH�FRQVSLUDWRUV�WR�WUDQVIRUP�WKHLU�KXJH�ZHDOWK

LQWR�VXFK�VR�FDOOHG��IRXQGDWLRQV��DQG�DYRLG�SD\PHQW�RI

YLUWXDOO\�DOO�LQFRPH�WD[HV��7KH�H[FXVH�IRU�LW�ZDV�WKDW�WKH

HDUQLQJV�RI�WKRVH��WD[�IUHH�IRXQGDWLRQV��ZRXOG�EH�GHYRWHG

WR�KXPDQLWDULDQ�SKLODQWKURS\��6R�ZH�QRZ�KDYH�WKH

VHYHUDO�5RFNHIHOOHU�)RXQGDWLRQV��WKH�&DUQHJLH�DQG

'RZPDQ�)XQG��WKH�)RUG�)RXQGDWLRQ��WKH�0HOORQ

)RXQGDWLRQ��DQG�KXQGUHGV�RI�VLPLODU��WD[�IUHH

IRXQGDWLRQV��

�$QG�ZKDW�NLQG�RI�SKLODQWKURS\�GR�WKHVH�IRXQGDWLRQV

VXSSRUW"�:HOO��WKH\�ILQDQFH�DOO�WKH�FLYLO�ULJKWV�JURXSV��DQG

FRQVHUYDWLRQ�PRYHPHQWV��WKDW�DUH�FUHDWLQJ�DOO�WKH�FKDRV

DQG�ULRWLQJ�DOO�RYHU�WKH�FRXQWU\��7KH\�ILQDQFH�WKH�0DUWLQ

/XWKHU�.LQJV��7KH�)RUG�)RXQGDWLRQ�ILQDQFHV�WKH��&HQWHU

IRU�WKH�6WXG\�RI�'HPRFUDWLF�,QVWLWXWLRQV��LQ�6DQWD

%DUEDUD��FRPPRQO\�UHIHUUHG�WR�DV�0RVFRZ�:HVW��DQG

ZKLFK�LV�KHDGHG�E\�:RQGHU�%R\�+XWFKHQV��:DOWHU�5XWKHU�

(UZLQ�&DKQDP�DQG�RWKHUV�RI�WKDW�LON�

�,Q�VKRUW��WKH��WD[�IUHH�IRXQGDWLRQV��ILQDQFHG�WKRVH�ZKR

DUH�GRLQJ�WKH�MRE�IRU�WKH�,OOXPLQDWLV�JUHDW�FRQVSLUDF\��$QG

ZKDW�DUH�WKH�KXQGUHGV�RI�ELOOLRQV�RI�GROODUV�WKH\�FRQILVFDWH

HYHU\�\HDU�IURP�WKH�HDUQLQJV�RI�WKH�FRPPRQ�KHUG��\RX

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 36: Fagan Transcript

DQG�PH��XVHG�IRU"�:HOO��IRU�RQH�WKLQJ��WKHUH�LV�WKH

�IRUHLJQ�DLG��JLPPLFN�ZKLFK�JDYH�ELOOLRQV�WR�FRPPXQLVW

7LWR�SOXV�JLIWV�RI�KXQGUHGV�RI�MHW�SODQHV��PDQ\�RI�ZKLFK

ZHUH�WXUQHG�RYHU�WR�&DVWUR��SOXV�WKH�FRVWV�RI�WUDLQLQJ

FRPPXQLVW�SLORWV�VR�WKDW�WKH\�FDQ�EHWWHU�VKRRW�GRZQ�RXU

SODQHV��%LOOLRQV�WR�UHG�3RODQG��%LOOLRQV�WR�,QGLD��%LOOLRQV�WR

6XFDUQR��%LOOLRQV�WR�RWKHU�HQHPLHV�RI�WKH�8QLWHG�6WDWHV�

7KDWV�ZKDW�WKDW�WUHDVRQRXV�UDLOURDGHG���WK�$PHQGPHQW

KDV�GRQH�WR�RXU�QDWLRQ�DQG�WR�WKH�$PHULFDQ�SHRSOH��WR�\RX

DQG�WR�PH��WR�\RXU�FKLOGUHQ�DQG�WKHLU�FKLOGUHQ�

�2XU�&)5�,OOXPLQDWL�FRQWUROOHG�IHGHUDO�JRYHUQPHQW�FDQ

JUDQW��WD[�IUHH�VWDWXV��WR�DOO�IRXQGDWLRQV�DQG�SUR�UHG

RQH�ZRUOG�RXWILWV��VXFK�DV�WKH��)XQG�IRU�WKH�5HSXEOLF���%XW

LI�\RX�RU�D�SDWULRWLF�SUR�RUJDQL]DWLRQ�LV�WRR�RXWVSRNHQO\

SUR�$PHULFDQ��WKH\�FDQ�WHUULI\�DQG�LQWLPLGDWH�\RX�E\

ILQGLQJ�D�PLVSODFHG�FRPPD�LQ�\RXU�LQFRPH�WD[�UHSRUW�DQG

E\�WKUHDWHQLQJ�\RX�ZLWK�SHQDOWLHV��ILQHV��DQG�HYHQ�SULVRQ�

)XWXUH�KLVWRULDQV�ZLOO�ZRQGHU�KRZ�WKH�$PHULFDQ�SHRSOH

FRXOG�KDYH�EHHQ�VR�QDLYH�DQG�VWXSLG�DV�WR�KDYH�SHUPLWWHG

VXFK�DXGDFLRXV�EUD]HQ�DFWV�RI�WUHDVRQ�DV�WKH��)HGHUDO

5HVHUYH�$FW��DQG�WKH����WK�$PHQGPHQW���:HOO��WKH\�ZHUH

QRW�QDLYH�DQG�WKH\�ZHUH�QRW�VWXSLG��7KH�DQVZHU�LV��WKH\

WUXVWHG�WKH�PHQ�WKH\�HOHFWHG�WR�VDIHJXDUG�RXU�FRXQWU\�DQG

RXU�SHRSOH��DQG�WKH\�MXVW�GLGQW�KDYH�HYHQ�DQ�LQNOLQJ

DERXW�HLWKHU�EHWUD\DO��XQWLO�DIWHU�HDFK�RQH�KDG�EHHQ

DFFRPSOLVKHG���7KLV�LV�7UXH��KRZHYHU��KH�IRUJRW�WR

PHQWLRQ�WKDW�WKH�SHRSOH�DOVR�EHOLHYHG�RWKHU�PHQ�

SUHDFKHUV�VR�FDOOHG��UDWKHU�WKDQ�EHOLHYH�+LV�:RUG����'DYLG

*��DQG�KHV�ULJKW���-$+�

�,W�ZDV�WKH�,OOXPLQDWL�FRQWUROOHG� PDVV�FRPPXQLFDWLRQV

PHGLD�WKDW�KDV�NHSW�DQG�LV�NHHSLQJ�RXU�SHRSOH�QDLYH�DQG

VWXSLG�DQG�XQDZDUH�RI�WKH�WUHDVRQ�EHLQJ�FRPPLWWHG��1RZ

WKH�JUHDW�TXHVWLRQ�LV���ZKHQ�ZLOO�WKH�SHRSOH�ZDNH�XS�DQG

GR�WR�RXU�WUDLWRUV�RI�WRGD\�ZKDW�*HRUJH�:DVKLQJWRQ�DQG

RXU�IRXQGLQJ�IDWKHUV�ZRXOG�KDYH�GRQH�WR�%HQHGLFW

$UQROG"��$FWXDOO\��%HQHGLFW�$UQROG�ZDV�D�SHWW\�WUDLWRU

FRPSDUHG�WR�RXU�SUHVHQW�WUDLWRUV�LQ�:DVKLQJWRQ�'�&���1RZ

OHWV�JR�EDFN�WR�WKH�HYHQWV�WKDW�IROORZHG�WKH�UDSH�RI�RXU

&RQVWLWXWLRQ�E\�WKH�SDVVDJH�RI�WKH�)HGHUDO�5HVHUYH�$FW

DQG�WKH���WK�$PHQGPHQW��:DV�:LOVRQ�FRPSOHWHO\�XQGHU

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 37: Fagan Transcript

WKHLU�FRQWURO"

�7KH�PDVWHUPLQGV�RI�WKH�JUHDW�FRQVSLUDF\�SXW�LQ�PRWLRQ

WKHLU�QH[W�DQG�ZKDW�WKH\�KRSHG�ZRXOG�EH�WKHLU�ILQDO�VWHSV

WR�DFKLHYH�WKHLU�RQH�ZRUOG�JRYHUQPHQW��7KH�ILUVW�RI�WKRVH

VWHSV�ZDV�WR�EH�:RUOG�:DU�,��:K\�:DU"�6LPSOH��WKH�RQO\

H[FXVH�IRU�D�RQH�ZRUOG�JRYHUQPHQW�ZDV�WKDW�LW�ZLOO

VXSSRVHGO\�HQVXUH�SHDFH��7KH�RQO\�WKLQJ�WKDW�FDQ�PDNH

SHRSOH�FU\�IRU�SHDFH�LV�ZDU��:DU�EULQJV�FKDRV��GHVWUXFWLRQ�

H[KDXVWLRQ��WR�WKH�ZLQQHU�DV�ZHOO�DV�WR�WKH�ORVHU��,W�EULQJV

HFRQRPLF�UXLQ�WR�ERWK��0RVW�LPSRUWDQW��LW�GHVWUR\V�WKH

IORZHU�RI�WKH�\RXQJ�PDQKRRG�RI�ERWK��7R�WKH�VDGGHQHG

DQG�KHDUWEURNHQ�ROGVWHUV��WKH�PRWKHUV�DQG�IDWKHUV��ZKR

DUH�OHIW�ZLWK�QRWKLQJ�EXW�PHPRULHV�RI�WKHLU�EHORYHG�VRQV�

SHDFH�EHFRPHV�ZRUWK�DQ\�SULFH�DQG�WKDW�LV�WKH� HPRWLRQ

XSRQ�ZKLFK�WKH�FRQVSLUDWRUV�GHSHQG�IRU�WKH�VXFFHVV�RI

WKHLU�VDWDQLF�SORW���7KH�DQVZHU�WR�WKLV�LV�VLPSOH��GR�QRW

VHUYH�LQ��WKHLU��DUPHG�IRUFHV�DQG�EHFRPH�WKH�FDQQRQ�

IRGGHU�RI�WKH�VHOI�VW\OHG�HOLWH��,I�\RX�GR��RU�SHUPLW�\RXU

FKLOGUHQ�WR�GR�VR��WKURXJK�WKH�LJQRUDQFH�\RX�SHUPLW��\RX

GHVHUYH�ZKDW�\RX��DQG�WKH\��JHW����'DYLG�*��

�7KURXJKRXW�WKH���WK�FHQWXU\��IURP������WR�������WKH

ZRUOG��DV�D�ZKROH��ZDV�DW�SHDFH��6XFK�ZDUV�DV�WKH

�)UDQFR�3UXVVLDQ���RXU�RZQ��&LYLO�:DU���WKH��5XVVR�

-DSDQHVH�:DU���ZHUH�ZKDW�PLJKW�EH�WHUPHG��ORFDO�

GLVWXUEDQFHV��WKDW�GLG�QRW�DIIHFW�WKH�UHVW�RI�WKH�ZRUOG��$OO

WKH�JUHDW�QDWLRQV�ZHUH�SURVSHURXV�DQG�WKH�SHRSOH�ZHUH

VWDXQFKO\�QDWLRQDOLVWLF�DQG�ILHUFHO\�SURXG�RI�WKHLU

VRYHUHLJQWLHV��,W�ZDV�XWWHUO\�XQWKLQNDEOH�WKDW�WKH�)UHQFK

DQG�WKH�*HUPDQ�SHRSOHV�ZRXOG�EH�ZLOOLQJ�WR�OLYH�XQGHU�D

�RQH�ZRUOG�JRYHUQPHQW���RU�WKH��7RNV��DQG�WKH

�5XVVLDQV���WKH��&KLQHVH���RU�WKH��-DSDQHVH���(YHQ�PRUH

XQWKLQNDEOH�LV�WKDW�D�.DLVHU�:LOKHOP�RU�D�)UDQ]�-RVHSK�RU

D�&]DU�1LFKRODV�RU�DQ\�0RQDUFK�ZRXOG�ZLOOLQJO\�DQG

PHHNO\�VXUUHQGHU�KLV�WKURQH�WR�D�RQH�ZRUOG�JRYHUQPHQW�

%XW�EHDU�LQ�PLQG�WKDW�WKH�SHRSOHV�LQ�DOO�QDWLRQV�DUH�WKH

UHDO�SRZHU�DQG��ZDU��WKH�RQO\�WKLQJ�WKDW�FRXOG�PDNH�WKH

SHRSOHV�\HDUQ�DQG�FODPRXU�IRU��SHDFH���HQVXULQJ�D

RQH�ZRUOG�JRYHUQPHQW��%XW�LW�ZRXOG�KDYH�WR�EH�D�IULJKWIXO

DQG�KRUULEO\�GHYDVWDWLQJ�ZDU��,W�FRXOG�QRW�EH�MXVW�D�ORFDO�

GLVWXUELQJ�ZDU�EHWZHHQ�MXVW�WZR�QDWLRQV��LW�ZRXOG�KDYH�WR

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 38: Fagan Transcript

EH�D��ZRUOG�ZDU���1R�PDMRU�QDWLRQ�PXVW�EH�OHIW�XQWRXFKHG

E\�WKH�KRUURUV�DQG�GHYDVWDWLRQ�RI�VXFK�D�ZDU��7KH�FU\�IRU

�SHDFH��PXVW�EH�PDGH�XQLYHUVDO�

�7KHUH�ZHUH�PRUH�OLYHV�ORVW�LQ�WKH��*UHDW�:DU����WKH�)LUVW

:RUOG�:DU���WKDQ�LQ�DQ\�RWKHU�ZDU�LQ�KLVWRU\��)RU�LQVWDQFH�

PRUH�PHQ�ZHUH�VODXJKWHUHG�LQ�RQH�EDWWOH�GXULQJ�WKH�)LUVW

:RUOG�:DU����WKH�>VR�FDOOHG@�ZDU�WR�HQG�DOO�ZDUV����>DQG

ZK\�ZDV�WKDW�H[DFW�SKUDVH�FRLQHG"@�WKDQ�LQ�WKH�ZKROH�RI

WKH�6HFRQG�:RUOG�:DU��:KDW�KDV�VHHPHG�XS�XQWLO�QRZ�WR

KDYH�EHHQ�WRWDOO\�LOORJLFDO�PLOLWDU\�VWUDWHJ\��QRZ�PDNHV

SHUIHFW�VHQVH��LI�\RX�ZDQWHG�DV�PDQ\�RI�\RXU�RZQ�PHQ�WR

EH�NLOOHG�DV�SRVVLEOH��7KDW�VWUDWHJ\�ZDV�WKDW�WKH�%ULWLVK

VROGLHUV�ZHUH�RUGHUHG�WR�ZDON�VORZO\�WRZDUGV�WKH�*HUPDQ

PDFKLQH�JXQV�DQG�QRW�WR�FKDUJH�WKHP�RU�WDNH�FRYHU�

UHVXOWLQJ�LQ�KRUUHQGRXV�FDUQDJH��,I�WKH\�GLVREH\HG��WKHQ

WKH\�ZHUH�SODFHG�LQ�IURQW�RI�D�ILULQJ�VTXDG�RI�WKHLU�RZQ

FRPUDGHV��VR��HLWKHU�ZD\��WKH\�ZRXOG�EH�VXUH�WR�GLH�

��7DNLQJ�WKLV�DV�DQ�H[DPSOH��LW�VKRXOG�EH�SODLQ�IRU�\RX�WR

VHH�WKDW�WKH�,OOXPLQDWL�KDYH�DEVROXWHO\� QR�TXDOPV �DERXW

VODXJKWHULQJ�PLOOLRQV�RI�SHRSOH�WKDW�WKH\�FRQVLGHU�WR�EH

�XVHOHVV�HDWHUV��DQG�VR�QHLWKHU�ZLOO�WKH\�KDYH�DQ\�TXDOPV

DERXW�VODXJKWHULQJ�ELOOLRQV�PRUH��VRRQ����-$+�

�$FWXDOO\�WKDW�ZDV�WKH�IRUPDW�VHW�E\�WKH�,OOXPLQDWL�DQG

1DWKDQ�5RWKVFKLOG�DW�WKH�WXUQ�RI�WKH���WK�FHQWXU\��7KH\

ILUVW�PDQHXYHUHG�DOO�RI�(XURSH�LQWR�WKH��1DSROHRQLF�:DUV��

WKHQ�WKH��&RQJUHVV�LQ�9LHQQD��ZKLFK�WKH\��DQG�SDUWLFXODUO\

5RWKVFKLOG��SODQQHG�WR�WUDQVIRUP�LQWR�D��/HDJXH�RI

1DWLRQV��ZKLFK�ZDV�WR�KDYH�EHHQ�WKH�KRXVLQJ�IRU�WKHLU

RQH�ZRUOG�JRYHUQPHQW��H[DFWO\�DV�WKH�SUHVHQW��8QLWHG

1DWLRQV��ZDV�VHW�XS�WR�EH�WKH�KRXVLQJ�IRU�WKH�IRUWKFRPLQJ�

*RG�IRUELG��RQH�ZRUOG�JRYHUQPHQW��$Q\ZD\��WKDW�ZDV�WKH

IRUPDW�WKH�+RXVH�RI�5RWKVFKLOG�DQG�-DFRE�6FKLII�GHFLGHG�WR

HPSOR\�WR�DFKLHYH�WKHLU�REMHFWLYH�LQ�������2I�FRXUVH�WKH\

NQHZ�WKDW�WKH�VDPH�IRUPDW�KDG�IDLOHG�LQ�������EXW�WKH\

WKHRUL]HG�WKDW�WKLV�ZDV�RQO\�EHFDXVH�WKH�&]DU�RI�5XVVLD

KDG�WRUSHGRHG�WKDW�VFKHPH��:HOO��WKH�SUHVHQW�����

FRQVSLUDWRUV�ZRXOG�HOLPLQDWH�WKDW������IO\�LQ�WKH

RLQWPHQW��7KH\G�PDNH�VXUH�WKDW�DIWHU�WKH�QHZ�ZRUOG�ZDU

WKDW�WKH\�ZHUH�FRQVSLULQJ��WKHUHG�EH�QR�&]DU�RI�5XVVLD

DURXQG�WR�WKURZ�PRQNH\�ZUHQFKHV�LQWR�WKH�PDFKLQHU\�

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 39: Fagan Transcript

�,�ZLOO�JR�LQWR�KRZ�WKH\�DFFRPSOLVKHG�WKLV�ILUVW�VWHS�WR

ODXQFK�D�ZRUOG�ZDU��+LVWRU\�UHFRUGV�WKDW�:RUOG�:DU�,�ZDV

SUHFLSLWDWHG�E\�D�WULYLDO�LQFLGHQW��WKH�NLQG�RI�LQFLGHQW�ERWK

:HLVKDXSW�DQG�$OEHUW�3LNH�KDG�LQFRUSRUDWHG�LQ�WKHLU

EOXHSULQWV��7KDW�LQFLGHQW�ZDV�WKH�DVVDVVLQDWLRQ�RI�DQ

$XVWULDQ�$UFKGXNH�DUUDQJHG�E\�WKH�,OOXPLQDWL

PDVWHUPLQGV��7KH�ZDU�IROORZHG��,W�LQYROYHG�*HUPDQ\�

$XVWULD��+XQJDU\��DQG�WKHLU�DOOLHV��WKH�VR�FDOOHG��$[LV

SRZHUV���DJDLQVW�)UDQFH��%ULWDLQ��DQG�5XVVLD��FDOOHG�WKH

�$OOLHV���2QO\�WKH�8QLWHG�6WDWHV�ZDV�QRW�LQYROYHG�GXULQJ

WKH�ILUVW�WZR�\HDUV�

�%\������WKH�FRQVSLUDWRUV�KDG�DFKLHYHG�WKHLU�SULPDU\

REMHFWLYH��DOO�RI�(XURSH�ZDV�LQ�D�VWDWH�RI�GHVWLWXWLRQ��$OO

WKH�SHRSOHV�ZHUH�ZDU�ZHDU\�DQG�FU\LQJ�IRU�SHDFH�DQG�WKH

RXWFRPH�WRR�ZDV�DOO�VHW��,W�ZDV�WR�FRPH�DV�VRRQ�DV�WKH

8QLWHG�6WDWHV�ZRXOG�EH�KXUOHG�LQ�RQ�WKH�VLGH�RI�WKH�$OOLHV

DQG�WKDW�ZDV�DOO�VHW�WR�KDSSHQ�LPPHGLDWHO\�DIWHU�:LOVRQV

UH�HOHFWLRQ��$IWHU�WKDW��WKHUH�FRXOG�EH�RQO\�RQH�RXWFRPH�

FRPSOHWH�YLFWRU\�IRU�WKH�$OOLHV��7R�IXOO\�FRQILUP�P\

VWDWHPHQW�WKDW�ORQJ�EHIRUH�������WKH�FRQVSLUDF\��KHDGHG

LQ�$PHULFD�E\�-DFRE�6FKLII��KDG�LW�DOO�VHW�WR�KXUO�WKH�8QLWHG

6WDWHV�LQWR�WKDW�ZDU��,�ZLOO�FLWH�WKH�SURRI�

�:KHQ�:LOVRQ�ZDV�FDPSDLJQLQJ�IRU�UH�HOHFWLRQ�LQ������

KLV�FKLHI�DSSHDO�ZDV���UH�HOHFW�WKH�PDQ�ZKR�ZLOO�NHHS�\RXU

VRQV�RXW�RI�WKH�ZDU���%XW�GXULQJ�WKDW�VDPH�FDPSDLJQ��WKH

5HSXEOLFDQ�3DUW\�SXEOLFO\�FKDUJHG�WKDW�:LOVRQ�KDG�ORQJ

FRPPLWWHG�KLPVHOI�WR�WKURZ�XV�LQWR�WKH�ZDU��7KH\�FKDUJHG

WKDW�LI�KH�ZRXOG�EH�GHIHDWHG�KH�ZRXOG�DFFRPSOLVK�WKDW�DFW

GXULQJ�KLV�IHZ�UHPDLQLQJ�PRQWKV�LQ�RIILFH��EXW�LI

UH�HOHFWHG��KH�ZRXOG�KROG�RII�XQWLO�DIWHU�WKH�HOHFWLRQ��%XW

DW�WKDW�WLPH�WKH�$PHULFDQ�SHRSOH�ORRNHG�XSRQ�:LOVRQ�DV�D

�*RG�PDQ���:HOO��:LOVRQ�ZDV�UH�HOHFWHG�DQG�DV�SHU�WKH

VFKHGXOH�RI�WKH�FRQVSLUDWRUV��KH�KXUOHG�XV�LQWR�WKH�ZDU�LQ

������+H�XVHG�WKH�VLQNLQJ�RI�WKH�/XVLWDQLD�DV�DQ�H[FXVH��D

VLQNLQJ�ZKLFK�DOVR�ZDV�SUHDUUDQJHG��5RRVHYHOW��DOVR�D

*RG�PDQ�LQ�WKH�H\HV�RI�WKH�$PHULFDQ�SHRSOH��IROORZHG�WKH

VDPH�WHFKQLTXH�LQ������ZKHQ�KH�XVHG�WKH�SUHDUUDQJHG

3HDUO�+DUERU�DWWDFN�DV�KLV�H[FXVH�IRU�KXUOLQJ�XV�LQWR�:RUOG

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 40: Fagan Transcript

:DU�,,�

�1RZ�H[DFWO\�DV�WKH�FRQVSLUDWRUV�SODQQHG��YLFWRU\�IRU�WKH

$OOLHV�ZRXOG�HOLPLQDWH�DOO�WKH�0RQDUFKV�RI�WKH�GHIHDWHG

1DWLRQV�DQG�OHDYH�DOO�WKHLU�SHRSOH�OHDGHUOHVV��FRQIXVHG�

EHZLOGHUHG�DQG�SHUIHFWO\�FRQGLWLRQHG�IRU�WKH�RQH�ZRUOG

JRYHUQPHQW��WKDW�WKH�JUHDW�FRQVSLUDF\�LQWHQGHG�ZRXOG

IROORZ��%XW�WKHUH�VWLOO�ZRXOG�EH�DQ�REVWDFOH��WKH�VDPH

REVWDFOH�WKDW�KDG�EDONHG�WKH�,OOXPLQDWL�DQG�5RWKVFKLOG�DW

WKDW�&RQJUHVV�LQ�9LHQQD��SHDFH�JDWKHULQJ��DIWHU�WKH

1DSROHRQLF�:DUV��5XVVLD�ZRXOG�EH�RQ�WKH�ZLQQLQJ�VLGH�WKLV

WLPH�DV�LW�ZDV�LQ������DQG�WKHUHIRUH�WKH�&]DU�ZRXOG�EH

VHFXUHO\�VHDWHG�RQ�KLV�WKURQH��+HUH�LW�LV�SHUWLQHQW�WR�QRWH

WKDW�5XVVLD��XQGHU�WKH�&]DULVW�UHJLPH��KDG�EHHQ�WKH�RQH

FRXQWU\�LQ�ZKLFK�WKH�,OOXPLQDWL�KDG�QHYHU�PDGH�DQ\

KHDGZD\�QRU�KDG�WKH�5RWKVFKLOGV�HYHU�EHHQ�DEOH�WR

LQILOWUDWH�LQ�WKHLU�EDQNLQJ�LQWHUHVWV�WKXV�D�ZLQQLQJ�&]DU

ZRXOG�EH�PRUH�GLIILFXOW�WKDQ�HYHU�WR�FRSH�ZLWK��(YHQ�LI�KH

FRXOG�EH�HQWLFHG�LQWR�D�VR�FDOOHG��/HDJXH�RI�1DWLRQV���LW

ZDV�D�IRUHJRQH�FRQFOXVLRQ�WKDW�KH�ZRXOG�QHYHU��EXW

QHYHU��JR�IRU�D�RQH�ZRUOG�JRYHUQPHQW�

�6R�HYHQ�EHIRUH�WKH�RXWEUHDN�RI�:RUOG�:DU�,��WKH

FRQVSLUDWRUV�KDG�D�SODQ��LQ�WKH�PDNLQJ��WR�FDUU\�RXW

1DWKDQ�5RWKVFKLOGV�YRZ�RI������WR�GHVWUR\�WKH�&]DU�DQG

DOVR�PXUGHU�DOO�SRVVLEOH�UR\DO�KHLUV�WR�WKH�WKURQH�DQG�LW

ZRXOG�KDYH�WR�EH�GRQH�EHIRUH�WKH�FORVH�RI�WKH�ZDU��7KH

5XVVLDQ�%ROVKHYLNV�ZHUH�WR�EH�WKHLU�LQVWUXPHQWV�LQ�WKLV

SDUWLFXODU�SORW��)URP�WKH�WXUQ�RI�WKH�FHQWXU\��WKH�FKLHIV�RI

WKH�%ROVKHYLNV�ZHUH�1LFRODL�/HQLQ��/HRQ�7URWVN\��DQG�ODWHU

-RVHSK�6WDOLQ��2I�FRXUVH��WKRVH�ZHUH�QRW�WKHLU�WUXH�IDPLO\

QDPHV��3ULRU�WR�WKH�RXWEUHDN��6ZLW]HUODQG�EHFDPH�WKHLU

KDYHQ��7URWVN\V�KHDGTXDUWHUV�ZDV�RQ�WKH�ORZHU�(DVW�6LGH

LQ�1HZ�<RUN��ODUJHO\�WKH�KDELWDW�RI�5XVVLDQ�-HZLVK

UHIXJHHV��%RWK�/HQLQ�DQG�7URWVN\�ZHUH�VLPLODUO\

EHZKLVNHUHG�DQG�XQNHPSW��,Q�WKRVH�GD\V�WKDW�ZDV�WKH

EDGJH�RI�%ROVKHYLVP��%RWK�OLYHG�ZHOO�\HW�QHLWKHU�KDG�D

UHJXODU�RFFXSDWLRQ��1HLWKHU�KDG�DQ\�YLVLEOH�PHDQV�RI

VXSSRUW��\HW�ERWK�DOZD\V�KDG�SOHQW\�RI�PRQH\��$OO�WKRVH

P\VWHULHV�ZHUH�VROYHG�LQ� ������5LJKW�IURP�WKH�RXWVHW�RI

WKH�ZDU��VWUDQJH�DQG�P\VWHULRXV�JRLQJV�RQ�ZHUH�WDNLQJ

SODFH�LQ�1HZ�<RUN��1LJKW�DIWHU�QLJKW��7URWVN\�GDUWHG

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 41: Fagan Transcript

IXUWLYHO\�LQ�DQG�RXW�RI�-DFRE�6FKLIIV�SDODFH�PDQVLRQ�DQG

LQ�WKH�GHDG�RI�WKRVH�VDPH�QLJKWV�WKHUH�ZHUH�D�JDWKHULQJ

RI�KRRGOXPV�RI�1HZ�<RUNV�ORZHU�(DVW�6LGH��$OO�RI�WKHP

5XVVLDQ�UHIXJHHV�DW�7URWVN\V�KHDGTXDUWHUV�DQG�DOO�ZHUH

JRLQJ�WKURXJK�VRPH�P\VWHULRXV�VRUW�RI�WUDLQLQJ�SURFHVV

WKDW�ZDV�DOO�VKURXGHG�LQ�P\VWHU\��1RERG\�WDONHG��DOWKRXJK

LW�GLG�OHDN�RXW�WKDW�6FKLII�ZDV�ILQDQFLQJ�DOO�RI�7URWVN\V

DFWLYLWLHV�

�7KHQ�VXGGHQO\�7URWVN\�YDQLVKHG�DQG�VR�GLG�DSSUR[LPDWHO\

����RI�KLV�WUDLQHG�KRRGOXPV��$FWXDOO\�WKH\�ZHUH�RQ�WKH

KLJK�VHDV�LQ�D�6FKLII�FKDUWHUHG�VKLS�ERXQG�IRU�D

UHQGH]YRXV�ZLWK�/HQLQ�DQG�KLV�JDQJ�LQ�6ZLW]HUODQG��$QG

DOVR�RQ�WKDW�VKLS�ZDV�������������LQ�JROG��WKH

������������ZDV�SURYLGHG�WR�ILQDQFH�WKH�%ROVKHYLNV

WDNHRYHU�RI�5XVVLD��,Q�DQWLFLSDWLRQ�RI�7URWVN\V�DUULYDO�

/HQLQ�SUHSDUHG�WR�WKURZ�D�SDUW\�LQ�KLV�6ZLW]HUODQG

KLGHDZD\��0HQ�RI�WKH�YHU\�KLJKHVW�SODFHV�LQ�WKH�ZRUOG

ZHUH�WR�EH�JXHVWV�DW�WKDW�SDUW\��$PRQJ�WKHP�ZHUH�WKH

P\VWHULRXV�&RORQHO�(GZDUG�0DQGHOO�+RXVH��:RRGURZ

:LOVRQV�PHQWRU�DQG�SDOV\�ZDOV\��DQG�PRUH�LPSRUWDQW�

6FKLIIV�VSHFLDO�DQG�FRQILGHQWLDO�PHVVHQJHU��$QRWKHU�RI�WKH

H[SHFWHG�JXHVWV�ZDV�:DUEXUJ�RI�WKH�:DUEXUJ�%DQNLQJ

&ODQ�LQ�*HUPDQ\��ZKR�ZDV�ILQDQFLQJ�WKH�.DLVHU�DQG�ZKRP

WKH�.DLVHU�KDG�UHZDUGHG�E\�PDNLQJ�KLP�FKLHI�RI�WKH

6HFUHW�3ROLFH�RI�*HUPDQ\��,Q�DGGLWLRQ��WKHUH�ZHUH�WKH

5RWKVFKLOGV�RI�/RQGRQ�DQG�3DULV�DOVR�/LWKHQRWK�

.DNRQDYLFK��DQG�6WDOLQ��ZKR�ZDV�WKHQ�WKH�KHDG�RI�D�WUDLQ

DQG�EDQN�UREELQJ�JDQJ�RI�EDQGLWV���+H�ZDV�NQRZQ�DV�WKH

�-HVVH�-DPHV�RI�WKH�8UDOV��

�$QG�KHUH�,�PXVW�UHPLQG�\RX�WKDW�(QJODQG�DQG�)UDQFH

ZHUH�WKHQ�ORQJ�LQ�WKH�ZDU�ZLWK�*HUPDQ\�DQG�WKDW�RQ

)HEUXDU\����������:LOVRQ�KDG�EURNHQ�RII�DOO�GLSORPDWLF

UHODWLRQV�ZLWK�*HUPDQ\��7KHUHIRUH��:DUEXUJ��&RORQHO

+RXVH��WKH�5RWKVFKLOGV��DQG�DOO�WKRVH�RWKHUV�ZHUH�HQHPLHV

EXW�RI�FRXUVH��6ZLW]HUODQG�ZDV�QHXWUDO�JURXQG�ZKHUH

HQHPLHV�FRXOG�PHHW�DQG�EH�IULHQGV�DQG�HVSHFLDOO\�LI�WKH\

KDG�VRPH�VFKHPH�LQ�FRPPRQ��7KDW�/HQLQ�SDUW\�ZDV�YHU\

QHDUO\�ZUHFNHG�E\�DQ�XQIRUHVHHQ�LQFLGHQW��7KH�6FKLII�

FKDUWHUHG�VKLS�RQ�LWV�ZD\�WR�6ZLW]HUODQG�ZDV�LQWHUFHSWHG

DQG�WDNHQ�LQWR�FXVWRG\�E\�D�%ULWLVK�ZDUVKLS��%XW�6FKLII

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 42: Fagan Transcript

TXLFNO\�UXVKHG�RUGHUV�WR�:LOVRQ�WR�RUGHU�WKH�%ULWLVK�WR

UHOHDVH�WKH�VKLS�LQWDFW�ZLWK�7URWVN\V�KRRGOXPV�DQG�WKH

JROG��:LOVRQ�REH\HG��+H�ZDUQHG�WKH�%ULWLVK�WKDW�LI�WKH\

UHIXVHG�WR�UHOHDVH�WKH�VKLS��WKH�8QLWHG�6WDWHV�ZRXOG�QRW

HQWHU�WKH�ZDU�LQ�$SULO�DV�KH�KDG�IDLWKIXOO\�SURPLVHG�D�\HDU

HDUOLHU��7KH�%ULWLVK�KHHGHG�WKH�ZDUQLQJ��7URWVN\�DUULYHG�LQ

6ZLW]HUODQG�DQG�WKH�/HQLQ�SDUW\�ZHQW�RII�DV�VFKHGXOHG�

EXW�WKH\�VWLOO�IDFHG�ZKDW�RUGLQDULO\�ZRXOG�KDYH�EHHQ�WKH

LQVXUPRXQWDEOH�REVWDFOH�RI�JHWWLQJ�WKH�/HQLQ�7URWVN\�EDQG

RI�WHUURULVWV�DFURVV�WKH�ERUGHU�LQWR�5XVVLD��:HOO��WKDWV

ZKHUH�%URWKHU�:DUEXUJ��FKLHI�RI�WKH�*HUPDQ�6HFUHW

3ROLFH��FDPH�LQ��+H�ORDGHG�DOO�WKRVH�WKXJV�LQWR�VHDOHG

IUHLJKW�FDUV�DQG�PDGH�DOO�WKH�QHFHVVDU\�DUUDQJHPHQWV�IRU

WKHLU�VHFUHW�HQWU\�LQWR�5XVVLD��7KH�UHVW�LV�KLVWRU\��7KH

UHYROXWLRQ�LQ�5XVVLD�WRRN�SODFH�DQG�DOO�PHPEHUV�RI�WKH

UR\DO�5RPDQRII�IDPLO\�ZHUH�PXUGHUHG�

�1RZ�P\�FKLHI�REMHFWLYH�LV�WR�HVWDEOLVK�EH\RQG�HYHQ�D

UHPRWH�GRXEW�WKDW�FRPPXQLVP��VR�FDOOHG��LV�DQ�LQWHJUDO

SDUW�RI�WKH�,OOXPLQDWL�JUHDW�FRQVSLUDF\�IRU�WKH�HQVODYHPHQW

RI�WKH�HQWLUH�ZRUOG��7KDW�FRPPXQLVP��VR�FDOOHG��LV�PHUHO\

WKHLU�ZHDSRQ�DQG�ERJ\�PDQ�ZRUG�WR�WHUULI\�WKH�SHRSOHV�RI

WKH�ZKROH�ZRUOG�DQG�WKDW�WKH�FRQTXHVW�RI�5XVVLD�DQG�WKH

FUHDWLRQ�RI�FRPPXQLVP�ZDV��LQ�JUHDW�SDUW��RUJDQL]HG�E\

6FKLII�DQG�WKH�RWKHU�LQWHUQDWLRQDO�EDQNHUV�ULJKW�LQ�RXU�RZQ

FLW\�RI�1HZ�<RUN��$�IDQWDVWLF�VWRU\"�<HV��6RPH�PLJKW�HYHQ

UHIXVH�WR�EHOLHYH�LW��:HOO��IRU�WKH�EHQHILW�RI�DQ\��'RXEWLQJ

7KRPDV���,�ZLOO�SURYH�LW�E\�UHPLQGLQJ�WKDW�MXVW�D�IHZ�\HDUV

DJR�&KDUOLH�.QLFNHUERFNHU��D�+HDUVW�QHZVSDSHU�FROXPQLVW�

SXEOLVKHG�DQ�LQWHUYLHZ�ZLWK�-RKQ�6FKLII��JUDQGVRQ�RI

-DFRE��LQ�ZKLFK�\RXQJ�6FKLII�FRQILUPHG�WKH�HQWLUH�VWRU\

DQG�QDPHG�WKH�ILJXUH�ROG�-DFRE�FRQWULEXWHG��������������

�,I�DQ\ERG\�VWLOO�KDV�HYHQ�D�UHPRWH�GRXEW�WKDW�WKH�HQWLUH

PHQDFH�RI�FRPPXQLVP�ZDV�FUHDWHG�E\�WKH�PDVWHUPLQGV�RI

WKH�JUHDW�FRQVSLUDF\�ULJKW�LQ�RXU�RZQ�FLW\�RI�1HZ�<RUN��,

ZLOO�FLWH�WKH�IROORZLQJ�KLVWRULFDO�IDFW��$OO�UHFRUGV�VKRZ�WKDW

ZKHQ�/HQLQ�DQG�7URWVN\�HQJLQHHUHG�WKH�FDSWXUH�RI�5XVVLD�

WKH\�RSHUDWHG�DV�KHDGV�RI�WKH�%ROVKHYLNV�SDUW\��1RZ

�%ROVKHYLVP��LV�D�SXUHO\�5XVVLDQ�ZRUG��7KH�PDVWHUPLQGV

UHDOL]HG�WKDW�%ROVKHYLVP�FRXOG�QHYHU�EH�VROG�DV�DQ

LGHRORJ\�WR�DQ\�EXW�WKH�5XVVLDQ�SHRSOH��6R�LQ�$SULO������

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 43: Fagan Transcript

-DFRE�6FKLII�GLVSDWFKHG�&RORQHO�+RXVH�WR�0RVFRZ�ZLWK

RUGHUV�WR�/HQLQ��7URWVN\��DQG�6WDOLQ�WR�FKDQJH�WKH�QDPH�RI

WKHLU�UHJLPH�WR�WKH�&RPPXQLVW�3DUW\�DQG�WR�DGRSW�WKH�.DUO

0DU[��0DQLIHVWR��DV�WKH�FRQVWLWXWLRQ�RI�WKH�&RPPXQLVW

3DUW\��/HQLQ��7URWVN\��DQG�6WDOLQ�REH\HG��DQG�LQ�WKDW�\HDU

RI������ZDV�ZKHQ�WKH�&RPPXQLVW�SDUW\�DQG�WKH�PHQDFH

RI�FRPPXQLVP�FDPH�LQWR�EHLQJ��$OO�WKLV�LV�FRQILUPHG�LQ

:HEVWHUV�&ROOHJLDWH�'LFWLRQDU\��)LIWK�(GLWLRQ�

�,Q�VKRUW��FRPPXQLVP�ZDV�FUHDWHG�E\�WKH�FDSLWDOLVWV�

7KXV��XQWLO�1RYHPEHU�����������WKH�HQWLUH�ILHQGLVK�SODQ�RI

WKH�FRQVSLUDWRUV�ZRUNHG�SHUIHFWO\��$OO�WKH�JUHDW�QDWLRQV�

LQFOXGLQJ�WKH�8QLWHG�6WDWHV��ZHUH�ZDU�ZHDU\��GHYDVWDWHG�

DQG�PRXUQLQJ�WKHLU�GHDG��3HDFH�ZDV�WKH�JUHDW�XQLYHUVDO

GHVLUH��7KXV�ZKHQ�LW�ZDV�SURSRVHG�E\�:LOVRQ�WR�VHW�XS�D

�/HDJXH�RI�1DWLRQV��WR�HQVXUH�SHDFH��DOO�WKH�JUHDW�QDWLRQV�

ZLWK�QR�5XVVLDQ�&]DU�WR�VWDQG�LQ�WKHLU�ZD\��MXPSHG�RQ

WKDW�EDQGZDJRQ�ZLWKRXW�HYHQ�VWRSSLQJ�WR�UHDG�WKH�ILQH

SULQW�LQ�WKDW�LQVXUDQFH�SROLF\��7KDW�LV��DOO�EXW�RQH��WKH

8QLWHG�6WDWHV��WKH�YHU\�RQH�WKDW�6FKLII�DQG�KLV

FR�FRQVSLUDWRUV�OHDVW�H[SHFWHG�ZRXOG�EDON�DQG�WKDW�ZDV

WKHLU�RQH�IDWDO�PLVWDNH�LQ�WKDW�HDUO\�SORW��<RX�VHH��ZKHQ

6FKLII�SODQWHG�:RRGURZ�:LOVRQ�LQ�WKH�:KLWH�+RXVH��WKH

FRQVSLUDWRUV�DVVXPHG�WKDW�WKH\�KDG�WKH�8QLWHG�6WDWHV�LQ

WKH�SURYHUELDO�EDJ��:LOVRQ�KDG�EHHQ�SHUIHFWO\�EXLOW�XS�DV�D

JUHDW�KXPDQLWDULDQ��+H�VXSSRVHGO\�EHFDPH�HVWDEOLVKHG�DV

D�*RG�PDQ�ZLWK�WKH�$PHULFDQ�SHRSOH��7KHUH�ZDV�HYHU\

UHDVRQ�IRU�WKH�FRQVSLUDWRUV�WR�KDYH�EHOLHYHG�WKDW�KH�ZRXOG

KDYH�HDVLO\�KRUQVZDJJOHG�&RQJUHVV�LQWR�EX\LQJ�WKH

�/HDJXH�RI�1DWLRQV���VLJKW�XQVHHQ��H[DFWO\�DV�WKH

&RQJUHVV�RI������ERXJKW�WKH��8QLWHG�1DWLRQV���VLJKW�

XQVHHQ��%XW�WKHUH�ZDV�RQH�PDQ�LQ�WKH�6HQDWH�LQ�����

ZKR�VDZ�WKURXJK�WKDW�VFKHPH�MXVW�DV�WKH�5XVVLDQ�&]DU�GLG

LQ�������+H�ZDV�D�PDQ�RI�JUHDW�SROLWLFDO�VWDWXUH��DOPRVW�DV

JUHDW�DV�WKDW�RI�7HGG\�5RRVHYHOW�DQG�IXOO\�DV�DVWXWH��+H

ZDV�KLJKO\�UHVSHFWHG�DQG�WUXVWHG�E\�DOO�PHPEHUV�RI�ERWK

KRXVHV�RI�&RQJUHVV�DQG�E\�WKH�$PHULFDQ�SHRSOH��7KH

QDPH�RI�WKDW�JUHDW�DQG�SDWULRWLF�$PHULFDQ�ZDV�+HQU\

&DERW�/RGJH��QRW�WKH�SKRQ\�RI�WRGD\�ZKR�FDOOHG�KLPVHOI

+HQU\�&DERW�/RGJH��-U���XQWLO�KH�ZDV�H[SRVHG��/RGJH

FRPSOHWHO\�XQPDVNHG�:LOVRQ�DQG�NHSW�WKH�8QLWHG�6WDWHV

RXW�RI�WKH��/HDJXH�RI�1DWLRQV��

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 44: Fagan Transcript

127(�

6KRUWO\�WKHUHDIWHU��WKH�,OOXPLQDWL�KDG�FUHDWHG�WKH���WK

$PHQGPHQW�WR�GR�DZD\�ZLWK�DSSRLQWHG�6HQDWRUV�E\�WKH

OHJLVODWXUHV�RI�WKH�VHYHUDO�VWDWHV�RI�WKH�8QLRQ��:KHUHDV�

EHIRUH�WKDW��WKH�,OOXPLQDWL�FRQWUROOHG�WKH�SUHVV��WKH\�QRZ

FRQWURO�WKH�HOHFWLRQ�RI�WKH�8�6��6HQDWRUV��7KH

,OOXPLQDWL�&)5�KDG�OLWWOH�RU�QR�SRZHU�RYHU�WKH�LQGLYLGXDO

OHJLVODWXUHV�RI�WKH�VHYHUDO�VWDWHV�RU�WKHLU�DSSRLQWHG�8�6�

6HQDWRUV�SULRU�WR�WKH�>SXUSRUWHG@�UDWLILFDWLRQ�RI�WKH���WK

$PHQGPHQW��$OWKRXJK�WKH���WK�$PHQGPHQW�VXSSRVHGO\

DPHQGV�WKH�PHWKRG�RI�SODFLQJ�6HQDWRUV�LQWR�WKH�8�6�

6HQDWH��WKH���WK�$PHQGPHQW�ZDV�QHYHU�UDWLILHG�LQ

DFFRUGDQFH�WR�WKH�ODVW�VHQWHQFH�RI�$UWLFOH�9�RI�WKH�8�6�

&RQVWLWXWLRQ��7ZR�VWDWHV��1HZ�-HUVH\�DQG�8WDK��YRWHG

GRZQ�WKH�SURSRVLWLRQ�DQG�QLQH�RWKHU�VWDWHV�QHYHU�YRWHG�DW

DOO��:KHUHDV�WKH�VWDWHV�RI�1HZ�-HUVH\�DQG�8WDK�H[SUHVVO\

UHIXVHG�WR�UHOLQTXLVK�WKHLU��VXIIUDJH��LQ�WKH�6HQDWH�ZKLOH

WKH�RWKHU�QRQ�YRWLQJ�QLQH�VWDWHV�QHYHU�JDYH�WKHLU

�H[SUHVV��FRQVHQW��WKH�SURSRVLWLRQ�IRU�WKH���WK

$PHQGPHQW�GLG�QRW�REWDLQ�WKH��XQDQLPRXV��YRWH�UHTXLUHG

IRU�LWV�DGRSWLRQ��)XUWKHUPRUH��WKH�UHVROXWLRQ�WKDW�FUHDWHG

WKH��3URSRVLWLRQ��GLG�QRW�SDVV�WKH�6HQDWH�ZLWK�D

�XQDQLPRXV��YRWH�DQG�DV�WKRVH�6HQDWRUV�RI�WKDW�GD\�ZHUH

�DSSRLQWHG��E\�WKH�OHJLVODWXUHV�RI�WKHLU�VWDWHV��WKRVH

�QHJDWLYH��YRWHV�RU��QRQ�YRWHV��ZHUH�PDGH�LQ�WKH�QDPH�RI

WKHLU�UHVSHFWLYH�VWDWH�

�+HUH�LW�EHFRPHV�RI�JUHDW�LQWHUHVW�WR�NQRZ�WKH�UHDO�UHDVRQ

IRU�WKH�:LOVRQ�/HDJXH�RI�1DWLRQV�IORS��$V�,�SUHYLRXVO\

VWDWHG��6FKLII�ZDV�VHQW�WR�WKH�8QLWHG�6WDWHV�WR�FDUU\�RXW

IRXU�VSHFLILF�DVVLJQPHQWV�

���$QG�PRVW�LPSRUWDQW��ZDV�WR�DFTXLUH�FRPSOHWH�FRQWURO�RI

WKH�8�6��PRQH\�V\VWHP�

���$V�RXWOLQHG�LQ�WKH�RULJLQDO�:HLVKDXSW�,OOXPLQDWL�

EOXHSULQW��KH�ZDV�WR�ILQG�WKH�ULJKW�NLQG�RI�PHQ�WR�VHUYH�DV

VWRRJHV�IRU�WKH�JUHDW�FRQVSLUDF\�DQG�SURPRWH�WKHP�LQWR

WKH�KLJKHVW�RIILFHV�LQ�RXU�IHGHUDO�JRYHUQPHQW��RXU

&RQJUHVV��RXU�8�6��6XSUHPH�&RXUW��DQG�DOO�IHGHUDO

DJHQFLHV��VXFK�DV�WKH�6WDWH�'HSDUWPHQW��WKH�3HQWDJRQ�

WKH�7UHDVXU\�'HSDUWPHQW��HWF���� (SKHVLDQV�������

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 45: Fagan Transcript

.�-�$�9� ��

���'HVWUR\�WKH�XQLW\�RI�WKH�$PHULFDQ�SHRSOH�E\�FUHDWLQJ

PLQRULW\�JURXSV�VWULIH�WKURXJKRXW�WKH�QDWLRQ��HVSHFLDOO\

EHWZHHQ�WKH�ZKLWHV�DQG�EODFNV�DV�RXWOLQHG�LQ�,VUDHO

&RKHQV�ERRN�

���&UHDWH�D�PRYHPHQW�WR�GHVWUR\�UHOLJLRQ�LQ�WKH�8QLWHG

6WDWHV�ZLWK�&KULVWLDQLW\�WR�EH�WKH�FKLHI�WDUJHW�RU�YLFWLP�

�(SKHVLDQV������)RU�ZH�ZUHVWOH�QRW�DJDLQVW�IOHVK�DQG

EORRG��EXW�DJDLQVW�SULQFLSDOLWLHV��DJDLQVW�SRZHUV��DJDLQVW

WKH� UXOHUV�RI�WKH�GDUNQHVV �RI�WKLV�ZRUOG��DJDLQVW�VSLULWXDO

ZLFNHGQHVV�LQ�KLJK�>SODFHV@�

�,Q�DGGLWLRQ��KH�ZDV�VWURQJO\�UHPLQGHG�RI�WKH�LPSHUDWLYH

GLUHFWLYH�RI�WKH�,OOXPLQDWL�EOXHSULQW�WR�DFKLHYH�IXOO�FRQWURO

RI�DOO�PDVV�FRPPXQLFDWLRQV�PHGLD�WR�EH�XVHG�WR

EUDLQZDVK�WKH�SHRSOH�LQWR�EHOLHYLQJ�DQG�DFFHSWLQJ�DOO�RI

WKH�PDQHXYHULQJV�RI�WKH�JUHDW�FRQVSLUDF\��6FKLII�ZDV

ZDUQHG�WKDW�RQO\�FRQWURO�RI�WKH�SUHVV��DW�WKDW�WLPH�RXU

RQO\�PDVV�FRPPXQLFDWLRQV�PHGLD��ZRXOG�HQDEOH�KLP�WR

GHVWUR\�WKH�XQLW\�RI�WKH�$PHULFDQ�SHRSOH�

�1RZ�WKHQ��6FKLII�DQG�KLV�FR�FRQVSLUDWRUV�GLG�VHW�XS�WKH

�1$$&3���WKH��1DWLRQDO�$VVRFLDWLRQ�IRU�WKH�$GYDQFHPHQW

RI�WKH�&RORXUHG�3HRSOH���LQ������DQG�LQ������KH�VHW�XS

WKH��$QWL�GHIDPDWLRQ�/HDJXH�RI�WKH�%QDL�%ULWK���ERWK

ZHUH�WR�FUHDWH�WKH�QHFHVVDU\�VWULIH��EXW�LQ�WKH�HDUO\�\HDUV�

WKH��$'/��RSHUDWHG�YHU\�WLPLGO\��3HUKDSV�IRU�IHDU�RI�D

�SRJURP�OLNH��DFWLRQ�E\�DQ�DURXVHG�DQG�HQUDJHG�$PHULFDQ

SHRSOH�DQG�WKH��1$$&3��ZDV�SUDFWLFDOO\�GRUPDQW�EHFDXVH

LWV�ZKLWH�OHDGHUVKLS�GLGQW�UHDOL]H�WKDW�WKH\�ZRXOG�KDYH�WR

GHYHORS�ILUH�EUDQG�1HJUR�OHDGHUV��VXFK�DV�0DUWLQ�/XWKHU

.LQJ�IRU�RQH��WR�VSDUN�WKH�WKHQ�FRPSOHWHO\�VDWLVILHG

FRQWHQWHG�PDVV�RI�1HJURHV�

�,Q�DGGLWLRQ��KH��6FKLII��ZDV�EXV\�GHYHORSLQJ�DQG

LQILOWUDWLQJ�WKH�VWRRJHV�WR�VHUYH�LQ�DOO�KLJK�SODFHV�LQ�RXU

:DVKLQJWRQ�JRYHUQPHQW�DQG�LQ�WKH�MRE�RI�DFTXLULQJ

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 46: Fagan Transcript

FRQWURO�RI�RXU�PRQH\�V\VWHP�DQG�WKH�FUHDWLRQ�RI�WKH����WK

$PHQGPHQW���+H�DOVR�ZDV�YHU\�EXV\�ZLWK�WKH�RUJDQL]LQJ

RI�WKH�SORW�IRU�WKH�WDNHRYHU�RI�5XVVLD��,Q�VKRUW��KH�ZDV

NHSW�VR�EXV\�ZLWK�DOO�WKRVH�MREV�WKDW�KH�FRPSOHWHO\

RYHUORRNHG�WKH�VXSUHPH�MRE�RI�DFTXLULQJ�FRPSOHWH�FRQWURO

RI�RXU�PDVV�FRPPXQLFDWLRQV�PHGLD��7KDW�RYHUVLJKW�ZDV�D

GLUHFW�FDXVH�IRU�:LOVRQV�IDLOXUH�WR�OXUH�WKH�8QLWHG�6WDWHV

LQWR�WKH��/HDJXH�RI�1DWLRQV��EHFDXVH�ZKHQ�:LOVRQ�GHFLGHG

WR�JR�WR�WKH�SHRSOH�WR�RYHUFRPH�WKH�RSSRVLWLRQ�RI�WKH

/RGJH�FRQWUROOHG�6HQDWH��GHVSLWH�KLV�HVWDEOLVKHG�EXW

SKRQ\�UHSXWDWLRQ�DV�D�JUHDW�KXPDQLWDULDQ��KH�IRXQG

KLPVHOI�IDFHG�E\�D�VROLGO\�XQLWHG�SHRSOH�DQG�E\�D�OR\DO

SUHVV�ZKRVH�RQO\�LGHRORJ\�ZDV��$PHULFDQLVP��DQG�WKH

$PHULFDQ�ZD\�RI�OLIH��$W�WKDW�WLPH��GXH�WR�WKH�LQHSWQHVV

DQG�LQHIIHFWLYHQHVV�RI�WKH��$'/��DQG�WKH��1$$&3���WKHUH

ZHUH�QR�RUJDQL]HG�PLQRULW\�JURXSV��QR�1HJUR�SUREOHPV�

QR�VR�FDOOHG�DQWLVHPLWLF�SUREOHPV�WR�VZD\�WKH�SHRSOHV

WKLQNLQJ��7KHUH�ZHUH�QR�OHIWV�DQG�WKHUH�ZHUH�QR�ULJKWV�QRU

DQ\�SUHMXGLFHV�IRU�FUDIW\�H[SORLWDWLRQV��7KXV�:LOVRQV

�/HDJXH�RI�1DWLRQV��DSSHDO�IHOO�RQ�GHDI�HDUV��7KDW�ZDV�WKH

HQG�RI�:RRGURZ�:LOVRQ��WKH�FRQVSLUDWRUV�JUHDW

KXPDQLWDULDQ��+H�TXLFNO\�DEDQGRQHG�KLV�FUXVDGH�DQG

UHWXUQHG�WR�:DVKLQJWRQ�ZKHUH�KH�VKRUWO\�GLHG�DQ�LPEHFLOH

EURXJKW�RQ�E\�V\SKLOLV�DQG�WKDW�ZDV�WKH�HQG�RI�WKH

�/HDJXH�RI�1DWLRQV��DV�D�FRUULGRU�LQWR�RQH�ZRUOG

JRYHUQPHQW�

�2I�FRXUVH�WKDW�GHEDFOH�ZDV�D�WHUULEOH�GLVDSSRLQWPHQW�WR

WKH�PDVWHUPLQGV�RI�WKH�,OOXPLQDWL�FRQVSLUDF\��EXW�WKH\

ZHUH�QRW�GLVFRXUDJHG��$V�,�KDYH�SUHYLRXVO\�VWUHVVHG��WKLV

HQHP\�QHYHU�TXLWV��WKH\�VLPSO\�GHFLGHG�WR�UHRUJDQL]H�DQG

WU\�IURP�VFUDWFK�DJDLQ��%\�WKLV�WLPH�6FKLII�ZDV�YHU\�ROG

DQG�VORZ��+H�NQHZ�LW��+H�NQHZ�WKDW�WKH�FRQVSLUDF\�QHHGHG

D�QHZ�\RXQJHU�DQG�PRUH�DFWLYH�OHDGHUVKLS��6R�RQ�KLV

RUGHUV��&RORQHO�+RXVH�DQG�%HUQDUG�%DURXN�RUJDQL]HG�DQG

VHW�XS�ZKDW�WKH\�FDOOHG�WKH��&RXQFLO�RQ�)RUHLJQ

5HODWLRQV���WKH�QHZ�QDPH�XQGHU�ZKLFK�WKH�,OOXPLQDWL

ZRXOG�FRQWLQXH�WR�IXQFWLRQ�LQ�WKH�8QLWHG�6WDWHV��7KH

KLHUDUFK\��RIILFHUV��DQG�GLUHFWRUV�RI�WKH��&)5��LV�FRPSRVHG

SULQFLSDOO\�RI�GHVFHQGDQWV�RI�WKH�RULJLQDO�,OOXPLQDWL��PDQ\

RI�ZKRP�KDG�DEDQGRQHG�WKHLU�ROG�IDPLO\�QDPH�DQG

DFTXLUHG�QHZ�$PHULFDQL]HG�QDPHV��)RU�RQH�H[DPSOH��ZH

KDYH�'LOORQ��ZKR�ZDV�6HFUHWDU\�RI�7UHDVXU\�RI�WKH�8QLWHG

6WDWHV��ZKRVH�RULJLQDO�QDPH�ZDV�/DSRVN\��$QRWKHU

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 47: Fagan Transcript

H[DPSOH�LV�3DXOH\��KHDG�RI�WKH�&%6�79�FKDQQHO��ZKRVH

WUXH�QDPH�LV�3DOLQVN\��7KH�PHPEHUVKLS�RI�WKH�&)5�LV

DSSUR[LPDWHO\�������LQ�QXPEHU�DQG�FRQWDLQV�WKH�KHDGV�RI

YLUWXDOO\�HYHU\�LQGXVWULDO�HPSLUH�LQ�$PHULFD�VXFK�DV

%ORXJK��SUHVLGHQW�RI�WKH�8�6��6WHHO�&RUSRUDWLRQ�

5RFNHIHOOHU��NLQJ�RI�WKH�RLO�LQGXVWU\��+HQU\�)RUG��,,��DQG�VR

RQ��$QG�RI�FRXUVH��DOO�WKH�LQWHUQDWLRQDO�EDQNHUV��$OVR��WKH

KHDGV�RI�WKH��WD[�IUHH��IRXQGDWLRQV�DUH�RIILFHUV�DQG�RU

DFWLYH�&)5�PHPEHUV��,Q�VKRUW��DOO�WKH�PHQ�ZKR�SURYLGHG

WKH�PRQH\�DQG�WKH�LQIOXHQFH�WR�HOHFW�WKH�&)5�FKRVHQ

3UHVLGHQWV�RI�WKH�8QLWHG�6WDWHV��WKH�&RQJUHVVPHQ��WKH

6HQDWRUV��DQG�ZKR�GHFLGH�WKH�DSSRLQWPHQWV�RI�RXU�YDULRXV

6HFUHWDULHV�RI�6WDWH��RI�WKH�7UHDVXU\��RI�HYHU\�LPSRUWDQW

IHGHUDO�DJHQF\�DUH�PHPEHUV�RI�WKH�&)5�DQG�WKH\�DUH�YHU\

REHGLHQW�PHPEHUV�LQGHHG�

�1RZ�MXVW�WR�FHPHQW�WKDW�IDFW��,�ZLOO�PHQWLRQ�WKH�QDPHV�RI

WKH�IHZ�RI�WKH�8QLWHG�6WDWHV�3UHVLGHQWV�ZKR�ZHUH

PHPEHUV�RI�WKH�&)5��)UDQNOLQ�5RRVHYHOW��+HUEHUW�+RRYHU�

'ZLJKW�'��(LVHQKRZHU��-DFN�.HQQHG\��1L[RQ��DQG�*HRUJH

%XVK��2WKHUV�ZKR�ZHUH�FRQVLGHUHG�IRU�WKH�SUHVLGHQF\�DUH

7KRPDV�(��'HZH\��$GODL�6WHYHQVRQ��DQG�YLFH�SUHVLGHQW�RI

D�&)5�VXEVLGLDU\��%DUU\�*ROGZDWHU��$PRQJ�WKH�LPSRUWDQW

FDELQHW�PHPEHUV�RI�WKH�YDULRXV�DGPLQLVWUDWLRQV�ZH�KDYH

-RKQ�)RVWHU�'XOOHV��$OOHQ�'XOOHV��&RUGHOO�+XOO��-RKQ�-�

0DF/HRG��0RUJDQWKDX��&ODUHQFH�'LOORQ��5XVN��0F1DPDUD�

DQG�MXVW�WR�HPSKDVL]H�WKH��UHG�FRORU��RI�WKH��&)5���ZH

KDYH�DV�PHPEHUV�VXFK�PHQ�DV�$OJHU�+HVV��5DOSK�%XQFKH�

3XVYROVN\��+DOH\�'H[WHU�:KLWH��UHDO�QDPH�:HLVV���2ZHQ

/DWWLPRUH��3KLOOLS�-DIIH\��HWF���HWF���6LPXOWDQHRXVO\��WKH\

ZHUH�IORRGLQJ�WKRXVDQGV�RI�KRPRVH[XDOV�DQG�RWKHU�EODFN

�QRW�1HJUR��PDOOHDEOH�FKDUDFWHUV�LQWR�DOO�WKH�IHGHUDO

DJHQFLHV�IURP�WKH�:KLWH�+RXVH�RQ�GRZQ��'R�\RX

UHPHPEHU�-RKQVRQV�JUHDW�IULHQGV��-HQNLQV�DQG�%REE\

%DNHU"

�1RZ�WKHUH�ZHUH�PDQ\�MREV�WKH�QHZ�&)5�KDG�WR

DFFRPSOLVK��7KH\�UHTXLUHG�PXFK�KHOS��6R�WKHLU�ILUVW�MRE

ZDV�WR�VHW�XS�YDULRXV��VXEVLGLDULHV��WR�ZKRP�WKH\

DVVLJQHG�VSHFLDO�REMHFWLYHV��,�FDQW�QDPH�DOO�WKH

VXEVLGLDULHV�LQ�WKLV�UHFRUGLQJ��EXW�WKH�IROORZLQJ�DUH�D�IHZ�

WKH��)RUHLJQ�3ROLF\�$VVRFLDWLRQ����)3$����WKH��:RUOG�$IIDLUV

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 48: Fagan Transcript

&RXQFLO����:$&����WKH��%XVLQHVV�$GYLVRU\�&RXQFLO�

��%$&����WKH�QRWRULRXV��$'$����$PHULFDQV�IRU� 'HPRFUDWLF

$FWLRQ��YLUWXDOO\�KHDGHG�E\�:DOWHU�5XWKHU���WKH�QRWRULRXV

��������LQ�&KLFDJR��%DUU\�*ROGZDWHU�ZDV��DQG�QR�GRXEW

VWLOO�LV�D�YLFH�SUHVLGHQW�RI�RQH�RI�WKH�&)5�VXEVLGLDULHV��,Q

DGGLWLRQ��WKH�&)5�VHW�XS�VSHFLDO�FRPPLWWHHV�LQ�HYHU\�VWDWH

LQ�WKH�8QLRQ�WR�ZKRP�WKH\�DVVLJQHG�WKH�YDULRXV�VWDWH

RSHUDWLRQV�

�6LPXOWDQHRXVO\��WKH�5RWKVFKLOGV�VHW�XS�VLPLODU�&)5�OLNH

FRQWURO�JURXSV�LQ�(QJODQG��)UDQFH��*HUPDQ\��DQG�RWKHU

1DWLRQV�WR�FRQWURO�ZRUOG�FRQGLWLRQV�DQG�FRRSHUDWH�ZLWK�WKH

&)5�WR�EULQJ�DERXW�DQRWKHU�ZRUOG�ZDU��%XW�WKH�&)5V�ILUVW

DQG�IRUHPRVW�MRE�ZDV�WR�JHW�FRPSOHWH�FRQWURO�RI�RXU

PDVV�FRPPXQLFDWLRQV�PHGLD��7KH�FRQWURO�RI�WKH�SUHVV�ZDV

DVVLJQHG�WR�5RFNHIHOOHU��7KXV��+HQU\�/XFH��ZKR�UHFHQWO\

GLHG��ZDV�ILQDQFHG�WR�VHW�XS�D�QXPEHU�RI�QDWLRQDO

PDJD]LQHV��DPRQJ�WKHP��/LIH����7LPH����)RUWXQH���DQG

RWKHUV��ZKLFK�SXEOLVK��8�6�6�5���LQ�$PHULFD��7KH

5RFNHIHOOHUV�DOVR�GLUHFWO\�RU�LQGLUHFWO\�ILQDQFHG�WKH�&ROHV

%URWKHUV��/RRN�PDJD]LQH��DQG�D�FKDLQ�RI�QHZVSDSHUV�

7KH\�DOVR�ILQDQFHG�D�PDQ�QDPHG�6DP�1HZKRXVH�WR�EX\

XS�DQG�EXLOG�D�FKDLQ�RI�QHZVSDSHUV�DOO�RYHU�WKH�FRXQWU\�

$QG�WKH�ODWH�(XJHQH�0\HU��RQH�RI�WKH�IRXQGHUV�RI�&)5�

ERXJKW�WKH��:DVKLQJWRQ�3RVW����1HZVZHHN���WKH��:HHNO\

PDJD]LQH���DQG�RWKHU�SXEOLFDWLRQV��$W�WKH�VDPH�WLPH��WKH

&)5�EHJDQ�WR�GHYHORS�DQG�QXUWXUH�D�QHZ�EUHHG�RI

VFXUULORXV�FROXPQLVWV�DQG�HGLWRULDOV�ZULWHUV�VXFK�DV�:DOWHU

/LSSPDQ��'UHZ�3HDUVRQ��WKH�$OVRSV��+HUEHUW�0DWWKHZV�

(UZLQ�&DQKDP��DQG�RWKHUV�RI�WKDW�LON�ZKR�FDOOHG

WKHPVHOYHV��/LEHUDOV��ZKR�SURFODLPHG�WKDW��$PHULFDQLVP�

LV��LVRODWLRQLVP���WKDW��LVRODWLRQLVP��LV��ZDU�PRQJHULVP��

WKDW��DQWL�FRPPXQLVP���LV��DQWL�VHPLWLFLVP��DQG��UDFLVP��

$OO�WKDW�WRRN�WLPH�RI�FRXUVH��EXW�WRGD\�RXU��ZHHNOLHV��

SXEOLVKHG�E\�SDWULRWLF�RUJDQL]DWLRQV��LV�FRPSOHWHO\

FRQWUROOHG�E\�&)5�VWRRJHV�DQG�WKXV�WKH\�ILQDOO\�VXFFHHGHG

LQ�EUHDNLQJ�XV�XS�LQWR�D�1DWLRQ�RI�TXDUUHOLQJ��ZUDQJOLQJ�

VTXDEEOLQJ��KDWLQJ�IDFWLRQV��1RZ�LI�\RX�VWLOO�ZRQGHU�DERXW

WKLV�VODQWHG�QHZV�DQG�RXWULJKW�OLHV�\RX�UHDG�LQ�\RXU

QHZVSDSHU��\RX�QRZ�KDYH�WKH�DQVZHU��7R�WKH�/HKPDQV�

*ROGPDQ�6DFKV��.XKQ�/RHEV��DQG�WKH�:DUEXUJV��WKH�&)5

DVVLJQHG�WKH�MRE�RI�JHWWLQJ�FRQWURO�RI�WKH�PRWLRQ�SLFWXUH

LQGXVWU\��+ROO\ZRRG��UDGLR��DQG�WHOHYLVLRQ��DQG�EHOLHYH�PH

WKH\�VXFFHHGHG��,I�\RX�VWLOO�ZRQGHU�DERXW�WKH�VWUDQJH

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 49: Fagan Transcript

SURSDJDQGD�EURDGFDVW�E\�WKH�(G�0RUURZV�DQG�RWKHUV�RI

WKDW�LON��\RX�QRZ�KDYH�WKH�DQVZHU��,I�\RX�ZRQGHU�DERXW

DOO�WKH�VPXW��VH[��SRUQRJUDSK\��DQG�PL[HG�PDUULDJH�ILOPV

\RX�VHH�LQ�\RXU�PRYLH�WKHDWHU�DQG�RQ�\RXU�WHOHYLVLRQ�VHW

�DOO�RI�ZKLFK�LV�GHPRUDOL]LQJ�RXU�\RXWK���\RX�QRZ�KDYH�WKH

DQVZHU�

�1RZ��WR�UHIUHVK�\RXU�PHPRU\��OHWV�JR�EDFN�IRU�D

PRPHQW��:LOVRQV�IORS�KDG�WRUSHGRHG�DOO�FKDQFHV�RI

WUDQVIRUPLQJ�WKDW��/HDJXH�RI�1DWLRQV��LQWR�WKH

FRQVSLUDWRUV�KRSH�IRU�D�RQH�ZRUOG�JRYHUQPHQW�KRXVLQJ�VR

WKH�-DFRE�6FKLII�SORW�KDG�WR�EH�GRQH�DOO�RYHU�DJDLQ�DQG

WKH\�RUJDQL]HG�WKH�&)5�WR�GR�LW��:H�DOVR�NQRZ�KRZ

VXFFHVVIXOO\�WKH�&)5�GLG�WKDW�MRE�RI�EUDLQZDVKLQJ�DQG

GHVWUR\LQJ�WKH�XQLW\�RI�WKH�$PHULFDQ�SHRSOH��%XW�DV�ZDV

WKH�FDVH�ZLWK�WKH�6FKLII�SORW��WKH�FOLPD[�DQG�WKH�FUHDWLRQ

RI�D�QHZ�KRXVLQJ�IRU�WKHLU�RQH�ZRUOG�JRYHUQPHQW�UHTXLUHG

DQRWKHU�ZRUOG�ZDU��$�ZDU�WKDW�ZRXOG�EH�HYHQ�PRUH

KRUULEOH�DQG�PRUH�GHYDVWDWLQJ�WKDQ�WKH�ILUVW�ZRUOG�ZDU�LQ

RUGHU�WR�JHW�WKH�SHRSOH�RI�WKH�ZRUOG�WR�DJDLQ�FODPRU�IRU

SHDFH�DQG�D�PHDQV�WR�HQG�DOO�ZDUV��%XW�WKH�&)5�UHDOL]HG

WKDW�WKH�DIWHUPDWK�RI�:RUOG�:DU�,,�ZRXOG�KDYH�WR�EH�PRUH

FDUHIXOO\�SODQQHG�VR�WKDW�WKHUH�ZRXOG�EH�QR�HVFDSH�IURP

WKH�QHZ�RQH�ZRUOG�WUDS���DQRWKHU��/HDJXH�RI�1DWLRQV��WKDW

ZRXOG�HPHUJH�IURP�WKH�QHZ�ZDU��7KDW�WUDS�ZH�QRZ�NQRZ

DV�WKH��8QLWHG�1DWLRQV��DQG�WKH\�KLW�XSRQ�D�SHUIHFW

VWUDWHJ\�WR�HQVXUH�WKDW�QR�RQH�HVFDSHG��+HUH�LV�KRZ�WKH\

GLG�LW�

�,Q�������LQ�WKH�PLGVW�RI�WKH�ZDU��WKH\�SUHSDUHG�WKH

IUDPHZRUN�IRU�WKH�8QLWHG�1DWLRQV�DQG�LW�ZDV�KDQGHG�RYHU

WR�5RRVHYHOW�DQG�RXU�6WDWH�'HSDUWPHQW�WR�EH�JLYHQ�ELUWK

E\�$OJHU�+HVV��3DOYRVN\��'DOWRQ��7UXPEXOO��DQG�RWKHU

$PHULFDQ�WUDLWRUV��WKXV�PDNLQJ�WKH�ZKROH�VFKHPH�D�8QLWHG

6WDWHV�EDE\��7KHQ�WR�IL[�RXU�SDUHQWKRRG��1HZ�<RUN�&LW\

ZDV�WR�EHFRPH�WKH�QXUVHU\�IRU�WKH�PRQVWURVLW\��$IWHU�WKDW

ZH�FRXOG�KDUGO\�ZDON�RXW�RQ�RXU�RZQ�EDE\�QRZ�FRXOG�ZH"

$Q\ZD\��WKDWV�KRZ�WKH�FRQVSLUDWRUV�ILJXUHG�LW�ZRXOG�ZRUN

DQG�VR�IDU�LW�KDV��7KH�OLEHUDO�5RFNHIHOOHU�GRQDWHG�WKH�ODQG

IRU�WKH�8QLWHG�1DWLRQV�EXLOGLQJ�

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 50: Fagan Transcript

�7KH�8QLWHG�1DWLRQV�FKDUWHU�ZDV�ZULWWHQ�E\�$OJHU�+HVV�

3DOYRVN\��'DOWRQ��7UXPEXOO��DQG�RWKHU�&)5�VWRRJHV��$

SKRQ\��VR�FDOOHG��8�1��FRQIHUHQFH�ZDV�VHW�XS�LQ�6DQ

)UDQFLVFR�LQ�������$OO�WKH��VR�FDOOHG��UHSUHVHQWDWLYHV�RI

���RGG�1DWLRQV�JDWKHUHG�WKHUH�DQG�SURPSWO\�VLJQHG�WKH

&KDUWHU�DQG�WKH�GHVSLFDEOH�WUDLWRU��$OJHU�+HVV��IOHZ�WR

:DVKLQJWRQ�ZLWK�LW��HODWHGO\�VXEPLWWHG�LW�WR�RXU�6HQDWH�

DQG�WKH�6HQDWH��HOHFWHG�E\�RXU�SHRSOH�WR�VDIHJXDUG�RXU

VHFXULW\��VLJQHG�WKH�&KDUWHU�ZLWKRXW�VR�PXFK�DV�UHDGLQJ

LW��7KH�TXHVWLRQ�LV���+RZ�PDQ\�RI�RXU�6HQDWRUV�ZHUH��HYHQ

WKHQ��WUDLWRURXV�VWRRJHV�RI�WKH�&)5"��$Q\ZD\��LW�ZDV�WKXV

WKDW�WKH�SHRSOH�DFFHSWHG�WKH��8QLWHG�1DWLRQV��DV�D��KRO\�RI

KROLHV��

$JDLQ�DQG�DJDLQ�DQG�DJDLQ�ZH�KDYH�EHHQ�VWDUWOHG�

VKRFNHG��EHZLOGHUHG��DQG�KRUULILHG�E\�WKHLU�PLVWDNHV�LQ

%HUOLQ��LQ�.RUHD��LQ�/DRV��LQ�.DWDQJD��LQ�&XED��LQ�9LHWQDP�

PLVWDNHV�WKDW�DOZD\V�IDYRXUHG�WKH�HQHP\��QHYHU�WKH

8QLWHG�6WDWHV��8QGHU�WKH�ODZ�RI�DYHUDJHV��WKH\�VKRXOG

KDYH�PDGH�DW�OHDVW�RQH�RU�WZR�PLVWDNHV�LQ�RXU�IDYRXU��EXW

WKH\�QHYHU�GLG��:KDWV�WKH�DQVZHU"�7KH�DQVZHU�LV�WKH

�&)5��DQG�WKH�SDUWV�SOD\HG�E\�WKHLU�VXEVLGLDULHV�DQG

VWRRJHV�LQ�:DVKLQJWRQ�'�&���WKXV�ZH�NQRZ�WKDW�FRPSOHWH

FRQWURO�RI�RXU�IRUHLJQ�UHODWLRQ�SROLF\�LV�WKH�NH\�WR�WKH

VXFFHVV�RI�WKH�HQWLUH�,OOXPLQDWL�RQH�ZRUOG�RUGHU�SORW��+HUH

LV�IXUWKHU�SURRI�

�(DUOLHU�,�IXOO\�HVWDEOLVKHG�WKDW�6FKLII�DQG�KLV�JDQJ�KDG

ILQDQFHG�WKH�/HQLQ��7URWVN\��6WDOLQ��WDNHRYHU�RI�5XVVLD�DQG

IDVKLRQHG�LWV�FRPPXQLVW�UHJLPH�LQWR�EHFRPLQJ�WKHLU�FKLHI

LQVWUXPHQW�WR�NHHS�WKH�ZRUOG�LQ�WXUPRLO�DQG�WR�ILQDOO\

WHUURUL]H�DOO�RI�XV�LQWR�VHHNLQJ�SHDFH�LQ�D�8�1��RQH�ZRUOG

JRYHUQPHQW��%XW�WKH�FRQVSLUDWRUV�NQHZ�WKDW�WKH��0RVFRZ

JDQJ��FRXOG�QRW�EHFRPH�VXFK�DQ�LQVWUXPHQW�XQWLO�DQG

XQOHVV�WKH�ZKROH�ZRUOG�ZRXOG�DFFHSW�WKH�FRPPXQLVW

UHJLPH�DV�WKH�OHJLWLPDWH��GH�MXUH�JRYHUQPHQW��RI�5XVVLD�

2QO\�RQH�WKLQJ�FRXOG�DFFRPSOLVK�WKDW�DQG�WKDW�LV�WKH

UHFRJQLWLRQ�E\�WKH�8QLWHG�6WDWHV��7KH�FRQVSLUDWRUV�ILJXUHG

WKDW�WKH�ZKROH�ZRUOG�ZRXOG�IROORZ�RXU�OHDG�DQG�WKDWV�WKHLU

EDJ��WR�LQGXFH�+DUGLQJ��&RROLGJH��DQG�+RRYHU��WR�JUDQW

WKDW�UHFRJQLWLRQ��%XW�DOO�WKUHH�UHIXVHG��$V�D�UHVXOW�RI�WKH

ODWH�����V��WKH�6WDOLQ�UHJLPH�ZDV�LQ�GLUH�VWUDLWV��'HVSLWH

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 51: Fagan Transcript

DOO�SXUJHV�DQG�VHFUHW�SROLFH�FRQWUROV��WKH�5XVVLDQ�SHRSOH

ZHUH�JURZLQJ�PRUH�DQG�PRUH�UHVLVWLYH��,W�LV�D�PDWWHU�RI

UHFRUG��DGPLWWHG�E\�/LSGHQRII��WKDW�GXULQJ������DQG������

6WDOLQ�DQG�KLV�ZKROH�JDQJ�ZHUH�DOZD\V�SDFNHG�DQG�UHDG\

IRU�LQVWDQW�IOLJKW�

�7KHQ�LQ�1RYHPEHU�������WKH�FRQVSLUDWRUV�DFKLHYHG�WKHLU

JUHDWHVW�FRXS��WKH\�ODQGHG�)UDQNOLQ�5RRVHYHOW�LQ�WKH

:KLWH�+RXVH��FUDIW\��XQVFUXSXORXV��DQG�XWWHUO\�ZLWKRXW

FRQVFLHQFH��7KDW�FKDUODWDQ�WUDLWRU�WXUQHG�WKH�WULFN�IRU

WKHP��:LWKRXW�HYHQ�DVNLQJ�FRQVHQW�RI�&RQJUHVV��KH

XQODZIXOO\�SURFODLPHG�UHFRJQLWLRQ�IRU�WKH�6WDOLQ�UHJLPH�

7KDW�GLG�LW��$QG�H[DFWO\�DV�WKH�FRQVSLUDWRUV�ILJXUHG��WKH

ZKROH�ZRUOG�GLG�IROORZ�RXU�OHDG��$XWRPDWLFDOO\�WKDW

VTXHOFKHG�WKH�SUHYLRXVO\�JURZLQJ�UHVLVWDQFH�PRYHPHQW�RI

WKH�5XVVLDQ�SHRSOH��7KDW�DXWRPDWLFDOO\�ODXQFKHG�WKH

JUHDWHVW�PHQDFH�WKH�FLYLOL]HG�ZRUOG�KDV�HYHU�NQRZQ��7KH

UHVW�LV�WRR�ZHOO�NQRZQ�WR�QHHG�UHSHDWLQJ�

�:H�NQRZ�KRZ�5RRVHYHOW�DQG�KLV�WUDLWRURXV�6WDWH

'HSDUWPHQW�NHSW�EXLOGLQJ�XS�WKH�FRPPXQLVW�PHQDFH�ULJKW

KHUH�LQ�RXU�FRXQWU\�DQG�WKXV�WKURXJKRXW�WKH�ZRUOG��:H

NQRZ�KRZ�KH�SHUSHWXDWHG�WKDW�ZKROH�+DUERXU�DWURFLW\�IRU

KLV�H[FXVH�WR�KXUO�XV�LQWR�:RUOG�:DU�,,��:H�NQRZ�DOO�DERXW

KLV�VHFUHW�PHHWLQJV�ZLWK�6WDOLQ�DW�<DOWD�DQG�KRZ�KH��ZLWK

(LVHQKRZHUV�KHOS��GHOLYHUHG�WKH�%DONDQV�DQG�%HUOLQ�WR

0RVFRZ�DQG�ODVW�EXW�E\�QR�PHDQV�OHDVW��ZH�NQRZ�WKDW�WKH

��WK�FHQWXU\�%HQHGLFW�$UQROG�QRW�RQO\�GUDJJHG�XV�LQWR

WKDW�QHZ�FRUULGRU��WKH�8QLWHG�1DWLRQV�LQWR�WKH�RQH�ZRUOG

JRYHUQPHQW��EXW�DFWXDOO\�VFKHPHG�DOO�WKH�DUUDQJHPHQWV�WR

SODQW�LW�ZLWKLQ�RXU�FRXQWU\��,Q�VKRUW��WKH�GD\�WKDW

5RRVHYHOW�HQWHUHG�WKH�:KLWH�+RXVH��WKH�&)5�FRQVSLUDWRUV

UHJDLQHG�IXOO�FRQWURO�RI�RXU�IRUHLJQ�UHODWLRQV�PDFKLQHU\

DQG�ILUPO\�HVWDEOLVKHG�WKH�8QLWHG�1DWLRQV�DV�WKH�KRXVLQJ

IRU�WKH�,OOXPLQDWL�RQH�ZRUOG�JRYHUQPHQW�

�,�ZLVK�WR�VWUHVV�RQH�RWKHU�YHU\�YLWDO�SRLQW��7KDW�:LOVRQ

�/HDJXH�RI�1DWLRQV��IORS�EURXJKW�6FKLII�DQG�KLV�JDQJ�WR�WKH

UHDOL]DWLRQ�WKDW�FRQWURO�RI�MXVW�WKH�'HPRFUDWLF�3DUW\�ZDV

QRW�HQRXJK��7UXH��7KH\�FRXOG�FUHDWH�D�FULVLV�GXULQJ�WKH

5HSXEOLFDQ�DGPLQLVWUDWLRQ�DV�WKH\�GLG�LQ������ZLWK�WKHLU

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 52: Fagan Transcript

IHGHUDO�UHVHUYH�PDQXIDFWXUHG�FUDVK�DQG�GHSUHVVLRQ�ZKLFK

ZRXOG�EULQJ�DQRWKHU�'HPRFUDW�VWRRJH�EDFN�LQWR�WKH�:KLWH

+RXVH��EXW�WKH\�UHDOL]HG�WKDW�D�IRXU�\HDU�GLVUXSWLRQ�LQ

WKHLU�FRQWURO�RI�RXU�IRUHLJQ�UHODWLRQ�SROLFLHV�FRXOG�SOD\

KDYRF�ZLWK�WKH�SURJUHVV�RI�WKHLU�FRQVSLUDF\��,W�FRXOG�HYHQ

EUHDN�XS�WKHLU�HQWLUH�VWUDWHJ\�DV�LW�DOPRVW�GLG�EHIRUH

5RRVHYHOW�VDYHG�LW�ZLWK�KLV�UHFRJQLWLRQ�RI�WKH�6WDOLQ

UHJLPH�

�7KHUHXSRQ��DIWHU�WKDW�:LOVRQ�GHEDFOH��WKH\�EHJDQ�WR

IRUPXODWH�SODQV�WR�DFKLHYH�FRQWURO�RI�ERWK�RI�RXU�QDWLRQDO

SDUWLHV��%XW�WKDW�SRVHG�D�SUREOHP�IRU�WKHP��7KH\�QHHGHG

PDQSRZHU�ZLWK�VWRRJHV�LQ�WKH�5HSXEOLFDQ�3DUW\�ZLWK

DGGLWLRQDO�PDQSRZHU�IRU�WKH�'HPRFUDWLF�3DUW\�DQG

EHFDXVH�FRQWURO�RI�MXVW�WKH�PDQ�LQ�WKH�:KLWH�+RXVH�ZRXOG

QRW�EH�HQRXJK��WKH\�ZRXOG�KDYH�WR�SURYLGH�WKDW�PDQ�ZLWK

WUDLQHG�VWRRJHV�IRU�KLV�HQWLUH�FDELQHW��0HQ�WR�KHDG�WKH

6WDWH�'HSDUWPHQW��WKH�7UHDVXU\�'HSDUWPHQW��WKH

3HQWDJRQ��WKH�&)5��WKH�86,$��HWF���,Q�VKRUW��HYHU\

PHPEHU�RI�WKH�YDULRXV�FDELQHWV�ZRXOG�KDYH�WR�EH�D�FKRVHQ

WRRO�RI�WKH�&)5��VXFK�DV�5XVN�DQG�0F1DPDUD��DV�ZHOO�DV�DOO

WKH�XQGHU�6HFUHWDULHV�DQG�DVVLVWDQW�6HFUHWDULHV��7KDW

ZRXOG�JLYH�WKH�FRQVSLUDWRUV�DEVROXWH�FRQWURO�RI�DOO�RXU

SROLFLHV��ERWK�GRPHVWLF�DQG�PRVW�LPSRUWDQW��IRUHLJQ��7KDW

FRXUVH�RI�DFWLRQ�ZRXOG�UHTXLUH�D�UHVHUYH�SRRO�RI�WUDLQHG

VWRRJHV��LQVWDQWDQHRXVO\�UHDG\�IRU�DGPLQLVWUDWLYH�FKDQJHV

DQG�IRU�DOO�RWKHU�H[LJHQFLHV��$OO�VXFK�VWRRJHV�ZRXOG�RI

QHFHVVLW\�KDYH�WR�EH�PHQ�RI�QDWLRQDO�UHSXWDWLRQ��KLJK�LQ

WKH�HVWHHP�RI�WKH�SHRSOH��EXW�WKH\�ZRXOG�KDYH�WR�EH�PHQ

ZLWKRXW�KRQRU��ZLWKRXW�VFUXSOH��DQG�ZLWKRXW�FRQVFLHQFH�

7KHVH�PHQ�ZRXOG�KDYH�WR�EH�YXOQHUDEOH�WR�EODFNPDLO��,W�LV

QHHGOHVV�IRU�PH�WR�VWUHVV�KRZ�ZHOO�WKH�&)5�VXFFHHGHG��7KH

LPPRUWDO�-RH�0F&DUWK\�IXOO\�UHYHDOHG�WKDW�WKHUH�DUH

WKRXVDQGV�RI�VXFK�VHFXULW\�ULVNV�LQ�DOO�IHGHUDO�DJHQFLHV�

6FRWW�0DF/HRG�XQPDVNHG�WKRXVDQGV�PRUH�DQG�\RX�NQRZ

WKH�SULFH�WKDW�2UWHJD�KDG�WR�SD\��DQG�LV�VWLOO�SD\LQJ��IRU�KLV

H[SRVLWLRQV�EHIRUH�D�6HQDWH�&RPPLWWHH�RI�WKH�WUDLWRUV�LQ

WKH�6WDWH�'HSDUWPHQW�DQG�\RX�NQRZ�WKDW�WKH�PHQ�LQ�WKH

6WDWH�'HSDUWPHQW��ZKR�GHOLYHUHG�&XED�WR�&DVWUR��KDYH�QRW

RQO\�EHHQ�VKLHOGHG��EXW�SURPRWHG�

�1RZ�OHWV�JR�EDFN�WR�WKH�FUX[�RI�WKH�ZKROH�RQH�ZRUOG

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 53: Fagan Transcript

JRYHUQPHQW�SORW�DQG�WKH�PDQHXYHULQJ�QHFHVVDU\�WR�FUHDWH

DQRWKHU��/HDJXH�RI�1DWLRQV��WR�KRXVH�VXFK�D�JRYHUQPHQW�

$V�,�KDYH�DOUHDG\�VWDWHG��WKH�FRQVSLUDWRUV�NQHZ�WKDW�RQO\

DQRWKHU�ZRUOG�ZDU�ZDV�YLWDO�IRU�WKH�VXFFHVV�RI�WKHLU�SORW��,W

ZRXOG�KDYH�WR�EH�VXFK�D�KRUULI\LQJ�ZRUOG�ZDU�WKDW�WKH

SHRSOHV�RI�WKH�ZRUOG�ZRXOG�FU\�RXW�IRU�WKH�FUHDWLRQ�RI

VRPH�NLQG�RI�D�ZRUOG�RUJDQL]DWLRQ�WKDW�FRXOG�VHFXUH�DQ

HYHUODVWLQJ�SHDFH��%XW�KRZ�FRXOG�VXFK�D�ZDU�EH�EURXJKW

DERXW"�$OO�WKH�(XURSHDQ�QDWLRQV�ZHUH�DW�SHDFH��1RQH�KDG

DQ\�TXDUUHOV�ZLWK�WKHLU�QHLJKERULQJ�QDWLRQV�DQG�FHUWDLQO\

WKHLU�VWRROV�LQ�0RVFRZ�ZRXOGQW�GDUH�WR�VWDUW�D�ZDU��(YHQ

6WDOLQ�UHDOL]HG�WKDW�LW�ZRXOG�PHDQ�WKH�RYHUWKURZ�RI�KLV

UHJLPH�XQOHVV��VR�FDOOHG���SDWULRWLVP��ZRXOG�ZHOG�WKH

5XVVLDQ�SHRSOH�EHKLQG�KLP�

�%XW�WKH�FRQVSLUDWRUV�KDG�WR�KDYH�D�ZDU��7KH\�KDG�WR�ILQG

RU�FUHDWH�VRPH�NLQG�RI�DQ�LQFLGHQW�WR�ODXQFK�LW��7KH\�IRXQG

LW�LQ�D�OLWWOH�LQFRQVSLFXRXV�DQG�UHSXOVLYH�OLWWOH�PDQ�ZKR

FDOOHG�KLPVHOI��$GROI�+LWOHU���+LWOHU��DQ�LPSHFXQLRXV

$XVWULDQ�KRXVH�SDLQWHU��KDG�EHHQ�D�FRUSRUDO�LQ�WKH

*HUPDQ�DUP\��+H�PDGH�WKH�GHIHDW�RI�*HUPDQ\�LQWR�D

SHUVRQDO�JULHYDQFH��+H�EHJDQ�WR��UDEEOH�URXVH��DERXW�LW�LQ

WKH�0XQLFK��*HUPDQ\�DUHD��+H�EHJDQ�WR�VSRXW�DERXW

UHVWRULQJ�WKH�JUHDWQHVV�RI�WKH�*HUPDQ�(PSLUH�DQG�WKH

PLJKW�RI�WKH�*HUPDQ�VROLGDULW\��+H�DGYRFDWHG�WKH

UHVWRUDWLRQ�RI�WKH�ROG�*HUPDQ�PLOLWDU\�WR�EH�XVHG�WR

FRQTXHU�WKH�ZKROH�ZRUOG��6WUDQJHO\�HQRXJK��+LWOHU��WKH

OLWWOH�FORZQ�WKDW�KH�ZDV��FRXOG�GHOLYHU�D�UDEEOH�URXVLQJ

VSHHFK�DQG�KH�GLG�KDYH�D�FHUWDLQ�NLQG�RI�PDJQHWLVP��%XW

WKH�QHZ�DXWKRULWLHV�LQ�*HUPDQ\�GLGQW�ZDQW�DQ\PRUH�ZDUV

DQG�WKH\�SURPSWO\�WKUHZ�WKH�REQR[LRXV�$XVWULDQ�KRXVH�

SDLQWHU�LQWR�D�SULVRQ�FHOO�

�$KD��+HUH�ZDV�WKH�PDQ��GHFLGHG�WKH�FRQVSLUDWRUV��ZKR��LI

SURSHUO\�GLUHFWHG�DQG�ILQDQFHG��FRXOG�EH�WKH�NH\�WR

DQRWKHU�ZRUOG�ZDU��6R�ZKLOH�KH�ZDV�LQ�SULVRQ��WKH\�KDG

5XGROSK�+HVV�DQG�*RHULQJ�ZULWH�D�ERRN�ZKLFK�WKH\�WLWOHG�

�0HLQ�.DPSI��DQG�DWWULEXWHG�WKH�DXWKRUVKLS�WR�+LWOHU�

H[DFWO\�DV�/LSGHQRII�ZURWH���0LVVLRQ�WR�0RVFRZ��DQG

DWWULEXWHG�WKH�DXWKRUVKLS�WR�-RVHSK�'DYLHV��WKHQ�RXU

DPEDVVDGRU�WR�5XVVLD�DQG�D�VWRRJH�RI�WKH�&)5��,Q��0HLQ

.DPSI���WKH�+LWOHU�SVHXGR�DXWKRU�RXWOLQHG�KLV�JULHYDQFHV

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 54: Fagan Transcript

DQG�KRZ�KH�ZRXOG�UHVWRUH�WKH�*HUPDQ�SHRSOH�WR�WKHLU

IRUPHU�JUHDWQHVV��7KH�FRQVSLUDWRUV�WKHQ�DUUDQJHG�IRU�D

ZLGH�FLUFXODWLRQ�RI�WKH�ERRN�DPRQJ�WKH�*HUPDQ�SHRSOH�LQ

RUGHU�WR�DURXVH�D�IDQDWLFDO�IROORZLQJ�IRU�KLP��2Q�KLV

UHOHDVH�IURP�SULVRQ��DOVR�DUUDQJHG�E\�WKH�FRQVSLUDWRUV��

WKH\�EHJDQ�WR�JURRP�DQG�ILQDQFH�KLP�WR�WUDYHO�WR�RWKHU

SDUWV�RI�*HUPDQ\�WR�GHOLYHU�KLV�UDEEOH�URXVLQJ�VSHHFKHV�

6RRQ�KH�JDWKHUHG�D�JURZLQJ�IROORZLQJ�DPRQJ�RWKHU

YHWHUDQV�RI�WKH�ZDU��WKDW�VRRQ�VSUHDG�WR�WKH�PDVVHV��ZKR

EHJDQ�WR�VHH�LQ�KLP�D�VDYLRXU�IRU�WKHLU�EHORYHG�*HUPDQ\�

7KHQ�FDPH�KLV�OHDGHUVKLS�RI�ZKDW�KH�FDOOHG��KLV

EURZQ�VKLUW�DUP\��DQG�WKH�PDUFK�RQ�%HUOLQ��7KDW�UHTXLUHG

D�JUHDW�GHDO�RI�ILQDQFLQJ��EXW�WKH�5RWKVFKLOGV��WKH

:DUEXUJV��DQG�RWKHUV�RI�WKH�FRQVSLUDWRUV�SURYLGHG�DOO�WKH

PRQH\�KH�QHHGHG��*UDGXDOO\�+LWOHU�EHFDPH�WKH�LGRO�RI�WKH

*HUPDQ�SHRSOH�DQG�WKH\�WKHQ�RYHUWKUHZ�WKH�9RQ

+LQGHQEXUJ�JRYHUQPHQW�DQG�+LWOHU�EHFDPH�WKH�QHZ

)ÜKUHU��%XW�WKDW�VWLOO�ZDV�QR�UHDVRQ�IRU�D�ZDU��7KH�UHVW�RI

WKH�ZRUOG�ZDWFKHG�+LWOHUV�ULVH�EXW�VDZ�QR�UHDVRQ�WR

LQWHUIHUH�LQ�ZKDW�ZDV�GLVWLQFWO\�D�GRPHVWLF�FRQGLWLRQ

ZLWKLQ�*HUPDQ\��&HUWDLQO\�QRQH�RI�WKH�RWKHU�1DWLRQV�IHOW�LW

ZDV�D�UHDVRQ�IRU�DQRWKHU�ZDU�DJDLQVW�*HUPDQ\�DQG�WKH

*HUPDQ�SHRSOH�ZHUH�QRW�\HW�LQFLWHG�LQWR�HQRXJK�RI�D

IUHQ]\�WR�FRPPLW�DQ\�DFWV�DJDLQVW�DQ\�QHLJKERULQJ�QDWLRQ�

QRW�HYHQ�DJDLQVW�)UDQFH��WKDW�ZRXOG�OHDG�WR�D�ZDU��7KH

FRQVSLUDWRUV�UHDOL]HG�WKH\�ZRXOG�KDYH�WR�FUHDWH�VXFK�D

IUHQ]\��D�IUHQ]\�WKDW�ZRXOG�FDXVH�WKH�*HUPDQ�SHRSOH�WR

WKURZ�FDXWLRQ�WR�WKH�ZLQGV�DQG�DW�WKH�VDPH�WLPH��KRUULI\

WKH�ZKROH�ZRUOG��$QG�LQFLGHQWDOO\���0HLQ�.DPSI��ZDV

DFWXDOO\�D�IROORZ�XS�RI�.DUO�0DU[V�ERRN���$�:RUOG�:LWKRXW

-HZV��

�7KH�FRQVSLUDWRUV�VXGGHQO\�UHPHPEHUHG�KRZ�WKH�6FKLII�

5RWKVFKLOG�JDQJ�KDG�HQJLQHHUHG�WKH�SRJURPV�LQ�5XVVLD

ZKLFK�VODXJKWHUHG�PDQ\��PDQ\�WKRXVDQGV�RI�-HZV�DQG

FUHDWHG�D�ZRUOG�ZLGH�KDWUHG�IRU�5XVVLD�DQG�WKH\�GHFLGHG

WR�XVH�WKDW�VDPH�XQFRQVFLRQDEOH�WULFN�WR�LQIODPH�WKH�QHZ

+LWOHU�OHG�*HUPDQ�SHRSOH�LQWR�D�PXUGHURXV�KDWUHG�RI�WKH

-HZV��1RZ�LW�LV�WUXH�WKDW�WKH�*HUPDQ�SHRSOH�QHYHU�KDG

DQ\�SDUWLFXODU�DIIHFWLRQ�IRU�WKH�-HZV��EXW�QHLWKHU�GLG�WKH\

KDYH�DQ�LQJUDLQHG�KDWUHG�IRU�WKHP��6XFK�D�KDWUHG�ZRXOG

KDYH�WR�EH�PDQXIDFWXUHG�VR�+LWOHU�ZDV�WR�FUHDWH�LW��7KLV

LGHD�PRUH�WKDQ�DSSHDOHG�WR�+LWOHU��+H�VDZ�LQ�LW�WKH�JULVO\

JLPPLFN�WR�PDNH�KLP�WKH��*RG�PDQ��� FKULVW��RI�WKH

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 55: Fagan Transcript

*HUPDQ�SHRSOH��ZLWK�KLV�VHOI�SURFODLPHG�������\HDU�UXOH��

5HYHODWLRQ�����������

.LQJ�RI�NLQJV�%LEOH��

5HYHODWLRQ�������$QG�,�EHKHOG�DQRWKHU�EHDVW�FRPLQJ�XS

RXW�RI�WKH�HDUWK��DQG�LW�KDG�WZR�KRUQV�OLNH�D�ODPE��DQG�KH

�+LWOHU��VSRNH�DV�WKH�GUDJRQ�

������$QG�KH�H[HUFLVHWK�DOO�WKH�SRZHU�RI�WKH�ILUVW�EHDVW

EHIRUH�KLP��DQG�FDXVHWK�WKH�HDUWK�DQG�WKHP�ZKLFK�GZHOO

WKHUHLQ�WR�ZRUVKLS�WKH�ILUVW�EHDVW��ZKRVH�GHDGO\�ZRXQG

ZDV�KHDOHG�

������$QG�KH�GRHWK�JUHDW�ZRQGHUV��VR�WKDW�KH�PDNHWK�ILUH

FRPH�GRZQ�IURP�KHDYHQ�RQ�WKH�HDUWK�LQ�WKH�VLJKW�RI�PHQ�

������$QG�GHFHLYHWK�WKHP�WKDW�GZHOO�RQ�WKH�HDUWK�E\�>WKH

PHDQV�RI@�WKRVH�PLUDFOHV�ZKLFK�KH�KDG�SRZHU�WR�GR�LQ�WKH

SUHVHQFH�RI�WKH�EHDVW��VD\LQJ�WR�WKHP�WKDW�GZHOO�RQ�WKH

HDUWK��WKDW�WKH\�VKRXOG�PDNH�DQ�LPDJH�WR�WKH�EHDVW��ZKLFK

KDG�WKH�ZRXQG�E\�WKH�VZRUG��DQG�GLG�OLYH��WKH�5RPDQ

(PSLUH���HDJOH�DQG�VZDVWLND�HPEOHPV��

������$QG�KH�KDG�SRZHU�WR�JLYH�OLIH�XQWR�WKH�LPDJH�RI�WKH

EHDVW��WKDW�WKH�LPDJH�RI�WKH�EHDVW�VKRXOG�ERWK�VSHDN��DQG

FDXVH�WKDW�DV�PDQ\�DV�ZRXOG�QRW�ZRUVKLS�WKH�LPDJH�RI�WKH

EHDVW�VKRXOG�EH�NLOOHG�

������$QG�KH�FDXVHWK�DOO��ERWK�VPDOO�DQG�JUHDW��ULFK�DQG

SRRU��IUHH�DQG�ERQG��WR�UHFHLYH�D�PDUN��'HXWVFK��LQ�WKHLU

ULJKW�KDQG��RU�LQ�WKHLU�IRUHKHDGV��0DU[�LVP��

������$QG�WKDW�QR�PDQ�PLJKW�EX\�RU�VHOO��VDYH�KH�WKDW

KDG�WKH�PDUN��RU�WKH�QDPH�RI�WKH�EHDVW��RU�WKH�QXPEHU�RI

LWV�QDPH�

������+HUH�LV�ZLVGRP��/HW�KLP�WKDW�KDWK�XQGHUVWDQGLQJ

FRXQW�WKH�QXPEHU�RI�WKH�EHDVW��IRU�LW�LV�WKH�QXPEHU�RI�PDQ

�FUHDWHG��WK��GD\���DQG�LWV�QXPEHU�>LV@�6L[�KXQGUHG

WKUHHVFRUH�>DQG@�VL[��PDQ��PDQ��PDQ��

�7KXV�FUDIWLO\�LQVSLUHG�DQG�FRDFKHG�E\�KLV�ILQDQFLDO�

DGYLVHUV��WKH�:DUEXUJV��WKH�5RWKVFKLOGV��DQG�DOO�WKH

,OOXPLQDWL�PDVWHUPLQGV��KH�EODPHG�WKH�-HZV�IRU�WKH�KDWHG

�9HUVDLOOHV�7UHDW\��DQG�IRU�WKH�ILQDQFLDO�UXLQDWLRQ�WKDW

IROORZHG�WKH�ZDU��7KH�UHVW�LV�KLVWRU\��:H�NQRZ�DOO�DERXW

WKH�+LWOHU�FRQFHQWUDWLRQ�FDPSV�DQG�WKH�LQFLQHUDWLRQ�RI

KXQGUHG�RI�WKRXVDQGV�RI�-HZV��1RW�WKH�����������QRU

HYHQ�WKH���������FODLPHG�E\�WKH�FRQVSLUDWRUV��EXW�LW�ZDV

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 56: Fagan Transcript

HQRXJK��$QG�KHUH�OHW�PH�UHLWHUDWH�KRZ�OLWWOH�WKH

LQWHUQDWLRQDOLVW�EDQNHUV��WKH�5RWKVFKLOGV��6FKLIIV�

/HKPDQV��:DUEXUJV��%DURXNV��FDUHG�DERXW�WKHLU�UDFLDO

EUHWKUHQ�ZKR�ZHUH�WKH�YLFWLPV�RI�WKHLU�QHIDULRXV�VFKHPHV�

,Q�WKHLU�H\HV��WKH�VODXJKWHU�RI�WKH�VHYHUDO�KXQGUHG

WKRXVDQG�LQQRFHQW�-HZV�E\�+LWOHU�GLGQW�ERWKHU�WKHP�DW�DOO�

7KH\�FRQVLGHUHG�LW�D�QHFHVVDU\�VDFULILFH�WR�IXUWKHU�WKHLU

,OOXPLQDWL�RQH�ZRUOG�SORW�MXVW�DV�WKH�VODXJKWHU�RI�WKH�PDQ\

PLOOLRQV�LQ�WKH�ZDUV�WKDW�IROORZHG�ZDV�D�VLPLODU�QHFHVVDU\

VDFULILFH��$QG�KHUH�LV�DQRWKHU�JULVO\�GHWDLO�DERXW�WKRVH

FRQFHQWUDWLRQ�FDPSV��0DQ\�RI�WKH�+LWOHU�VROGLHU�

H[HFXWLRQHUV�LQ�WKRVH�FDPSV�KDG�SUHYLRXVO\�EHHQ�VHQW�WR

5XVVLD�WR�DFTXLUH�WKHLU�DUWV�RI�WRUWXUH�DQG�EUXWDOL]DWLRQ�VR

DV�WR�HPSKDVL]H�WKH�KRUURUV�RI�WKH�DWURFLWLHV�

�$OO�WKLV�FUHDWHG�D�QHZ�ZRUOG�ZLGH�KDWUHG�IRU�WKH�*HUPDQ

SHRSOH�EXW�LW�VWLOO�GLG�QRW�SURYLGH�D�FDXVH�IRU�D�ZDU�

7KHUHXSRQ�+LWOHU�ZDV�LQFLWHG�WR�GHPDQG�WKH

�6XGHWHQODQG���DQG�\RX�UHPHPEHU�KRZ�&KDPEHUODLQ�DQG

WKH�WKHQ�GLSORPDWV�RI�&]HFKRVORYDNLD�DQG�)UDQFH

VXUUHQGHUHG�WR�WKDW�GHPDQG��7KDW�GHPDQG�OHG�WR�IXUWKHU

+LWOHULDQ�GHPDQGV�IRU�WHUULWRULHV�LQ�3RODQG�DQG�LQ�WKH

)UHQFK�&]DU�WHUULWRULHV�DQG�WKRVH�GHPDQGV�ZHUH�UHMHFWHG�

7KHQ�FDPH�KLV�SDFW�ZLWK�6WDOLQ��+LWOHU�KDG�EHHQ�VFUHDPLQJ

KDWUHG�DJDLQVW�FRPPXQLVP��2K�KRZ�KH�UDQWHG�DJDLQVW

FRPPXQLVP���EXW�DFWXDOO\�QD]LVP�ZDV�QRWKLQJ�EXW

VRFLDOLVP��QDWLRQDO�VRFLDOLVP���1D]L���DQG�FRPPXQLVP�LV�

LQ�IDFW��VRFLDOLVP��%XW�+LWOHU�GLVUHJDUGHG�DOO�WKDW��+H

HQWHUHG�LQWR�D�SDFW�ZLWK�6WDOLQ�WR�DWWDFN�DQG�GLYLGH�3RODQG

EHWZHHQ�WKHP��:KLOH�6WDOLQ�PDUFKHG�LQWR�RQH�SDUW�RI

3RODQG��IRU�ZKLFK�KH�ZDV�QHYHU�EODPHG�>WKH�,OOXPLQDWL

PDVWHUPLQGV�VDZ�WR�WKDW@���+LWOHU�ODXQFKHG�D��EOLW]NULHJ�

RQ�3RODQG�IURP�KLV�VLGH��7KH�FRQVSLUDWRUV�ILQDOO\�KDG�WKHLU

QHZ�ZRUOG�ZDU�DQG�ZKDW�D�KRUULEOH�ZDU�LW�ZDV�

�$QG�LQ�������WKH�FRQVSLUDWRUV�ILQDOO\�DFKLHYHG�WKH

�8QLWHG�1DWLRQV ���WKHLU�QHZ�KRXVLQJ�IRU�WKHLU�RQH�ZRUOG

JRYHUQPHQW��$QG�WUXO\�DPD]LQJ��DOO�RI�WKH�$PHULFDQ

SHRSOH�KDLOHG�WKLV�IRXO�RXWILW�DV�D��+RO\�RI�+ROLHV���(YHQ

DIWHU�DOO�WKH�WUXH�IDFWV�DERXW�KRZ�WKH�8�1��ZDV�FUHDWHG

ZHUH�UHYHDOHG��WKH�$PHULFDQ�SHRSOH�FRQWLQXHG�WR�ZRUVKLS

WKDW�HYLO�RXWILW��(YHQ�DIWHU�$OJHU�+HVV�ZDV�XQPDVNHG�DV�D

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 57: Fagan Transcript

6RYLHW�VS\�DQG�WUDLWRU��WKH�$PHULFDQ�SHRSOH�FRQWLQXHG�WR

EHOLHYH�LQ�WKH�8�1���(YHQ�DIWHU�,�KDG�SXEOLFO\�UHYHDOHG�WKH

VHFUHW�DJUHHPHQW�EHWZHHQ�+HVV�DQG�0XODWRII�WKDW�D

5XVVLDQ�ZRXOG�DOZD\V�EH�WKH�KHDG�RI�WKH�PLOLWDU\�

VHFUHWDULDW�DQG�E\�WKDW�WRNHQ��WKH�UHDO�PDVWHU�RI�WKH�8�1��

%XW�PRVW�RI�WKH�$PHULFDQ�SHRSOH�FRQWLQXHG�WR�EHOLHYH�WKDW

WKH�8�1��FRXOG�GR�QR�ZURQJ��(YHQ�DIWHU�7ULJ�'��/HH��WKH

ILUVW�6HFUHWDU\�JHQHUDO�RI�WKH��8�1���FRQILUPHG�WKDW

+HVV�0XODWRII�VHFUHW�DJUHHPHQW�LQ�KLV�ERRN���)RU�7KH

&DXVH�RI�3HDFH���9DVLDOLD�ZDV�JLYHQ�D�OHDYH�RI�DEVHQFH�E\

WKH�8�1��VR�WKDW�KH�FRXOG�WDNH�FRPPDQG�RI�WKH�1RUWK

.RUHDQV�DQG�5HG�&KLQHVH�ZKR�ZHUH�ILJKWLQJ�WKH�VR�FDOOHG

8�1��SROLFH�DFWLRQ�XQGHU�RXU�RZQ�*HQHUDO�0F$UWKXU��ZKR�

E\�RUGHUV�RI�WKH�8�1���ZDV�ILUHG�E\�WKH�SXVLOODQLPRXV

SUHVLGHQW�7UXPDQ�LQ�RUGHU�WR�SUHYHQW�KLP�IURP�ZLQQLQJ

WKDW�ZDU��2XU�SHRSOH�VWLOO�EHOLHYHG�LQ�WKH�8�1��GHVSLWH�RXU

��������VRQV�ZKR�ZHUH�PXUGHUHG�DQG�PDLPHG�LQ�WKDW

ZDU��WKH�SHRSOH�FRQWLQXHG�WR�UHJDUG�WKH�8�1��DV�D�VXUH

PHDQV�IRU�SHDFH�HYHQ�DIWHU�LW�ZDV�UHYHDOHG�LQ������WKDW

WKH�8�1���XVLQJ�RXU�RZQ�$PHULFDQ�VROGLHUV�XQGHU�8�1�

FRPPDQG��XQGHU�WKH�8�1��IODJ��LQ�FROOXVLRQ�ZLWK�RXU

WUDLWRURXV�6WDWH�'HSDUWPHQW�DQG�WKH�3HQWDJRQ��KDG�EHHQ

LQYDGLQJ�PDQ\�VPDOO�FLWLHV�LQ�&DOLIRUQLD�DQG�7H[DV�LQ�RUGHU

WR�SHUIHFW�WKHLU�SODQ�IRU�WKH�FRPSOHWH�WDNHRYHU�RI�RXU

FRXQWU\��0RVW�RI�RXU�SHRSOH�EUXVKHG�LW�RII�DQG�FRQWLQXHG

WKHLU�EHOLHI�WKDW�WKH�8�1��LV�D��+RO\�RI�+ROLHV����5DWKHU

WKDQ�7KH�$UN�RI�7KH�&RYHQDQW��

�'R�\RX�NQRZ�WKDW�WKH�8�1��&KDUWHU�ZDV�ZULWWHQ�E\�WUDLWRU

$OJHU�+HVV��0XODWRII��DQG�9\VKLQVN\"�7KDW�+HVV�DQG

0XODWRII�KDG�PDGH�ZLWKLQ�WKDW�VHFUHW�DJUHHPHQW�WKDW�WKH

PLOLWDU\�FKLHI�RI�WKH�8�1��ZDV�DOZD\V�WR�EH�D�5XVVLDQ

DSSRLQWHG�E\�0RVFRZ"�'R�\RX�NQRZ�WKDW�DW�WKHLU�VHFUHW

PHHWLQJV�DW�<DOWD��5RRVHYHOW�DQG�6WDOLQ��DW�WKH�EHKHVW�RI

WKH�,OOXPLQDWL�RSHUDWLQJ�DV�WKH�&)5��GHFLGHG�WKDW�WKH�8�1�

PXVW�EH�SODFHG�RQ�$PHULFDQ�VRLO"�'R�\RX�NQRZ�WKDW�PRVW

RI�WKH�8�1��&KDUWHU�ZDV�FRSLHG�LQWDFW��ZRUG�IRU�ZRUG��IURP

WKH�0DU[��0DQLIHVWR��DQG�WKH�5XVVLDQ��VR�FDOOHG�

FRQVWLWXWLRQ"�'R�\RX�NQRZ�WKDW�RQO\�WKH�WZR�6HQDWRUV�ZKR

YRWHG�DJDLQVW�WKH�8�1��&KDUWHU�KDG�UHDG�LW"�'R�\RX�NQRZ

WKDW�VLQFH�WKH�8�1��ZDV�IRXQGHG��FRPPXQLVW�HQVODYHPHQW

KDV�JURZQ�IURP���������WR��������������"�'R�\RX�NQRZ

WKDW�VLQFH�WKH�8�1��ZDV�IRXQGHG�WR�LQVXUH�SHDFH�WKHUH

KDYH�EHHQ�DW�OHDVW����PDMRU�ZDUV�LQFLWHG�E\�WKH�8�1��MXVW

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 58: Fagan Transcript

DV�WKH\�LQFLWHG�ZDU�DJDLQVW�OLWWOH�5KRGHVLD�DQG�.XZDLW"�'R

\RX�NQRZ�WKDW�XQGHU�WKH�8�1��VHW�XS��WKH�$PHULFDQ

WD[SD\HUV�KDYH�EHHQ�IRUFHG�WR�PDNH�XS�WKH�8�1�

7UHDVXU\�GHILFLW�RI�PDQ\�PLOOLRQV�RI�GROODUV�EHFDXVH�RI

5XVVLDV�UHIXVDO�WR�SD\�KHU�VKDUH"�'R�\RX�NQRZ�WKDW�WKH

8�1��KDG�QHYHU�SDVVHG�D�UHVROXWLRQ�FRQGHPQLQJ�5XVVLD�RU

KHU�VR�FDOOHG�VDWHOOLWHV��EXW�DOZD\V�FRQGHPQV�RXU�$OOLHV"

'R�\RX�NQRZ�WKDW�-��(GJDU�+RRYHU�VDLG���WKH

RYHUZKHOPLQJ�PDMRULW\�RI�WKH�FRPPXQLVW�GHOHJDWLRQV�WR

WKH�8�1��DUH�HVSLRQDJH�DJHQWV��DQG�WKDW����6HQDWRUV

YRWHG�IRU�D��&RQVXODU�7UHDW\��WR�RSHQ�RXU�HQWLUH�FRXQWU\

WR�5XVVLDQ�VSLHV�DQG�VDERWHXUV"�'R�\RX�NQRZ�WKDW�WKH

8�1��KHOSV�5XVVLDV�FRQTXHVW�RI�WKH�ZRUOG�E\�SUHYHQWLQJ

WKH�IUHH�ZRUOG�IURP�WDNLQJ�DQ\�DFWLRQ�ZKDWVRHYHU�H[FHSW

WR�GHEDWH�HDFK�QHZ�DJJUHVVLRQ�LQ�WKH�8�1��*HQHUDO

$VVHPEO\"�'R�\RX�NQRZ�WKDW�DW�WKH�WLPH�RI�WKH�.RUHDQ

:DU�WKHUH�ZHUH����1DWLRQV�LQ�WKH�8�1���\HW�����RI�WKH

8�1��IRUFHV�ZHUH�RXU�$PHULFDQ�VRQV�DQG�SUDFWLFDOO\�����

RI�WKH�FRVW�ZDV�SDLG�E\�WKH�8QLWHG�6WDWHV�WD[SD\HUV"

�$QG�VXUHO\�\RX�NQRZ�WKDW�WKH�8�1��SROLF\�GXULQJ�WKH

.RUHDQ�DQG�9LHWQDP�:DUV�ZDV�WR�SUHYHQW�XV�IURP�ZLQQLQJ

WKRVH�ZDUV"�'R�\RX�NQRZ�WKDW�DOO�WKH�EDWWOH�SODQV�RI

*HQHUDO�0F$UWKXU�KDG�WR�JR�ILUVW�WR�WKH�8�1��WR�EH�UHOD\HG

WR�9DVLDOLD��&RPPDQGHU�RI�WKH�1RUWK�.RUHDQV�DQG�5HG

&KLQHVH��DQG�WKDW�DQ\�IXWXUH�ZDUV�IRXJKW�E\�RXU�VRQV

XQGHU�WKH�8�1��IODJ�ZRXOG�KDYH�WR�EH�IRXJKW�E\�RXU�VRQV

XQGHU�WKH�FRQWURO�RI�WKH�8�1��6HFXULW\�&RXQFLO"�'R�\RX

NQRZ�WKDW�WKH�8�1��KDV�QHYHU�GRQH�DQ\WKLQJ�DERXW�WKH

�������5XVVLDQ�0RQJROLDQ�WURRSV�WKDW�RFFXS\�+XQJDU\"

�:KHUH�ZDV�WKH�8�1��ZKHQ�WKH�+XQJDULDQ�IUHHGRP�

ILJKWHUV�ZHUH�VODXJKWHUHG�E\�WKH�5XVVLDQV"�'R�\RX�NQRZ

WKDW�WKH�8�1��DQG�LWV�SHDFH�DUP\�WXUQHG�WKH�&RQJR�RYHU�WR

WKH�FRPPXQLVWV"�'R�\RX�NQRZ�WKDW�WKH�8�1�V�RZQ�

VR�FDOOHG��SHDFH�IRUFH�ZDV�XVHG�WR�FUXVK��UDSH��DQG�NLOO�WKH

ZKLWH�DQWL�FRPPXQLVWV�LQ�.DWDQJD"�'R�\RX�NQRZ�WKDW�WKH

8�1��VWRRG�E\�DQG�GLG�QRWKLQJ�ZKLOH�5HG�&KLQD�LQYDGHG

/DRV�DQG�9LHWQDP"�7KDW�LW�GLG�QRWKLQJ�ZKLOH�1HUR�LQYDGHG

*RD�DQG�RWKHU�3RUWXJXHVH�WHUULWRULHV"�'R�\RX�NQRZ�WKDW

WKH�8�1��ZDV�GLUHFWO\�UHVSRQVLEOH�IRU�DLGLQJ�&DVWUR"�7KDW�LW

GRHV�DEVROXWHO\�QRWKLQJ�DERXW�WKH�PDQ\�WKRXVDQGV�RI

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 59: Fagan Transcript

&XEDQ�\RXQJVWHUV�ZKR�DUH�VKLSSHG�WR�5XVVLD�IRU

FRPPXQLVW�LQGRFWULQDWLRQ�

�'R�\RX�NQRZ�WKDW�$GODL�6WHYHQVRQ�VDLG���WKH�IUHH�ZRUOG

PXVW�H[SHFW�WR�ORVH�PRUH�DQG�PRUH�GHFLVLRQV�LQ�WKH�8�1���

'R�\RX�NQRZ�WKDW�WKH�8�1��RSHQO\�SURFODLPV�WKDW�LWV�FKLHI

REMHFWLYH�LV�D��RQH�ZRUOG�JRYHUQPHQW��ZKLFK�PHDQV

�RQH�ZRUOG�ODZV����RQH�ZRUOG�FRXUW����RQH�ZRUOG�VFKRROV��

DQG�D��RQH�ZRUOG�FKXUFK��LQ�ZKLFK�&KULVWLDQLW\�ZRXOG�EH

SURKLELWHG"

�'R�\RX�NQRZ�WKDW�D�8�1��ODZ�KDV�EHHQ�SDVVHG�WR�GLVDUP

DOO�$PHULFDQ�FLWL]HQV�DQG�WR�WUDQVIHU�DOO�RXU�DUPHG�IRUFHV

WR�WKH�8�1�"�6XFK�D�ODZ�ZDV�VHFUHWO\�VLJQHG�E\�VDLQW�-DFN

.HQQHG\�LQ�������'R�\RX�UHDOL]H�KRZ�WKDW�ILWV�LQ�ZLWK

$UWLFOH�����SDUDJUDSK����RI�WKH�8�1��&KDUWHU��ZKLFK�VWDWHV

DQG�,�TXRWH���WKH�PLOLWDU\�VWDII�FRPPLWWHH�RI�WKH�8�1��VKDOO

EH�UHVSRQVLEOH�WKURXJK�WKH�6HFXULW\�&RXQFLO�IRU�WKH

VWUDWHJLF�GLUHFWLRQ�RI�DOO�DUPHG�IRUFHV�SODFHG�DW�WKH

GLVSRVDO�RI�WKH�6HFXULW\�&RXQFLO��DQG�ZKHQ�DQG�LI�DOO�RXU

DUPHG�IRUFHV�DUH�WUDQVIHUUHG�WR�WKH�8�1���\RXU�VRQV�ZRXOG

EH�IRUFHG�WR�VHUYH�DQG�GLH�XQGHU�WKH�8�1��FRPPDQG�DOO

RYHU�WKH�ZRUOG��7KLV�ZLOO�KDSSHQ�XQOHVV�\RX�ILJKW�WR�JHW

WKH�8�6��RXW�RI�WKH�8�1��

�'R�\RX�NQRZ�WKDW�&RQJUHVVPDQ�-DPHV�%��8WW�KDV

VXEPLWWHG�D�ELOO�WR�JHW�WKH�8�6��RXW�RI�WKH�8�1��DQG�D

UHVROXWLRQ�WR�SUHYHQW�RXU�3UHVLGHQW�IURP�IRUFLQJ�XV�WR

VXSSRUW�WKH�8�1��HPEDUJRHV�RQ�5KRGHVLD"�:HOO��KH�KDV

DQG�PDQ\�SHRSOH�DOO�RYHU�WKH�FRXQWU\�DUH�ZULWLQJ�WR�WKHLU

UHSUHVHQWDWLYHV�WR�VXSSRUW�WKH�8WW�ELOO�DQG�UHVROXWLRQ��)LIW\

&RQJUHVVPHQ��VSHDU�KHDGHG�E\�6FKZHLNHU�DQG�0RRUKHDG

RI�3HQQV\OYDQLD��KDYH�LQWURGXFHG�D�ELOO�WR�LPPHGLDWHO\

WUDQVIHU�DOO�RXU�DUPHG�IRUFHV�WR�WKH�8�1�"�&DQ�\RX�LPDJLQH

VXFK�EUD]HQ�WUHDVRQ"�,V�\RXU�&RQJUHVVPDQ�RQH�RI�WKRVH

���WUDLWRUV"�)LQG�RXW�DQG�WDNH�LPPHGLDWH�DFWLRQ�DJDLQVW

KLP�DQG�KHOS�&RQJUHVVPDQ�8WW�

�1RZ�GR�\RX�NQRZ�WKDW�WKH��1DWLRQDO�&RXQFLO�RI�&KXUFKHV�

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 60: Fagan Transcript

SDVVHG�D�UHVROXWLRQ�LQ�6DQ�)UDQFLVFR�ZKLFK�VWDWHV�WKDW�WKH

8QLWHG�6WDWHV�ZLOO�VRRQ�KDYH�WR�VXERUGLQDWH�LWV�ZLOO�WR�WKDW

RI�WKH�8�1��DQG�WKDW�DOO�$PHULFDQ�FLWL]HQV�PXVW�EH

SUHSDUHG�WR�DFFHSW�LW"�,V�\RXU�FKXUFK�D�PHPEHU�RI�WKH

�1DWLRQDO�&RXQFLO�RI�&KXUFKHV"��,Q�FRQQHFWLRQ�ZLWK�WKDW�

EHDU�LQ�PLQG�WKDW�*RG�LV�QHYHU�PHQWLRQHG�LQ�WKH�8�1�

&KDUWHU�DQG�WKHLU�PHHWLQJV�DUH�QHYHU�RSHQHG�ZLWK�SUD\HU�

�7KH�FUHDWRUV�RI�WKH�8�1��VWLSXODWHG�LQ�DGYDQFH�WKDW�WKHUH

VKRXOG�EH�QR�PHQWLRQ�RI�*RG�RU�-HVXV�&KULVW�LQ�WKH�8�1�

&KDUWHU�RU�LQ�LWV�8�1��KHDGTXDUWHUV��'RHV�\RXU�SDVWRU

VXEVFULEH�WR�WKDW"�)LQG�RXW��)XUWKHUPRUH��GR�\RX�NQRZ

WKDW�WKH�JUHDW�PDMRULW\�RI�WKH��VR�FDOOHG��1DWLRQV�LQ�WKH

8�1��DUH�DQWL�FKULVWLDQLW\�DQG�WKDW�WKH�8�1��LV�D�FRPSOHWHO\

*RGOHVV�RUJDQL]DWLRQ�E\�RUGHUV�RI�LWV�FUHDWRUV��WKH�&)5

,OOXPLQDWL��+DYH�\RX�KHDUG�HQRXJK�RI�WKH�WUXWK�DERXW�WKH

,OOXPLQDWLV�8QLWHG�1DWLRQV"�'R�\RX�ZDQW�WR�OHDYH�\RXU

VRQV�DQG�RXU�SUHFLRXV�FRXQWU\�WR�WKH�XQKRO\�PHUF\�RI�WKH

,OOXPLQDWLV�8QLWHG�1DWLRQV"�,I�\RX�GRQW��ZULWH��WHOHJUDSK�

RU�SKRQH�\RXU�5HSUHVHQWDWLYHV�DQG�6HQDWRUV�WKDW�WKH\

PXVW�VXSSRUW�&RQJUHVVPDQ�8WWV�ELOO�WR�JHW�WKH�8�6��RXW�RI

WKH�8�1��DQG�WKH�8�1��RXW�RI�WKH�8�6���'R�LW�WRGD\��QRZ�

EHIRUH�\RX�IRUJHW��,W�LV�WKH�RQO\�VDOYDWLRQ�IRU�\RXU�VRQV

DQG�IRU�RXU�FRXQWU\�

(]HNLHO������$QG�WKH�:RUG�RI�WKH��,�$0��FDPH�XQWR�PH�

VD\LQJ�

�����6RQ�RI�PDQ��SURSKHV\�DJDLQVW�WKH�SURSKHWV�RI�,VUDHO

WKDW�SURSKHV\��DQG�VD\�WKRX�XQWR�WKHP�WKDW�SURSKHV\�RXW

RI�WKHLU�RZQ�KHDUWV��+HDU�\H�WKH�:RUG�RI�WKH��,�$0��

�����7KXV�VDLWK�WKH�/RUG��,�$0���:RH�XQWR�WKH�IRROLVK

SURSKHWV��SROLWLFLDQV���WKDW�IROORZ�WKHLU�RZQ�VSLULW��DQG

KDYH�VHHQ�QRWKLQJ�

�����2�,VUDHO��%ULWDLQ�DQG�8�6�$����WKH�7ZR�:LWQHVVHV�DQG

UHODWHG�QDWLRQV ���WK\�SURSKHWV��SROLWLFLDQV��DUH�OLNH�WKH

�IR[HV�LQ�WKH�GHVHUWV���2SHUDWLRQ��'HVHUW�)R[���

�����<H�KDYH�QRW�JRQH�XS�LQWR�WKH�JDSV��QHLWKHU�PDGH�XS

WKH�KHGJH�IRU�WKH��+RXVH�RI�,VUDHO���WKH�7HQ��/RVW��7ULEHV

RI�,VUDHO��ZKLFK�LQFOXGH�DQG�DUH�OHG�E\�$PHULFD�DQG�%ULWDLQ�

WR�VWDQG�LQ�WKH�EDWWOH�LQ�7KH�'D\�RI�WKH��,�$0�

�$UPDJHGGRQ��

�����7KH\�KDYH�VHHQ�YDQLW\�DQG�O\LQJ�GLYLQDWLRQ��VD\LQJ�

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 61: Fagan Transcript

7KH��,�$0��VDLWK��DQG�WKH��,�$0��KDWK�QRW�VHQW�WKHP��DQG

WKH\�KDYH�PDGH�>RWKHUV@�WR�KRSH�WKDW�WKHLU�ZRUGV�ZRXOG

EH�FRQILUPHG�

�����+DYH�\H�QRW�VHHQ�D�YDLQ�YLVLRQ��DQG�KDYH�\H�QRW

VSRNHQ�D�O\LQJ�GLYLQDWLRQ��ZKHUHDV�\H�VD\��7KH��,�$0��VDLWK

>LW@��DOEHLW�,�KDYH�QRW�VSRNHQ"

�����7KHUHIRUH�WKXV�VDLWK�WKH�/RUG��,�$0���%HFDXVH�\H

KDYH�VSRNHQ�YDQLW\��DQG�VHHQ�OLHV��WKHUHIRUH��EHKROG��,

>DP@�DJDLQVW�\RX��VDLWK�WKH�/RUG��,�$0��

�����$QG�0LQH�KDQG�VKDOO�EH�XSRQ�WKH�SURSKHWV

�SROLWLFLDQV��WKDW�VHH�YDQLW\��DQG�WKDW�GLYLQH�OLHV��WKH\�VKDOO

QRW�EH�LQ�WKH�DVVHPEO\�RI�0\�SHRSOH��QHLWKHU�VKDOO�WKH\�EH

ZULWWHQ�LQ�WKH�ZULWLQJ�RI�WKH��+RXVH�RI�,VUDHO���QHLWKHU�VKDOO

WKH\�HQWHU�LQWR�WKH�ODQG�RI�,VUDHO��DQG�\H�VKDOO�NQRZ�WKDW�,

>DP@�WKH�/RUG��,�$0��

������%HFDXVH��HYHQ�EHFDXVH�WKH\�KDYH�VHGXFHG�0\

SHRSOH��VD\LQJ��3HDFH��DQG�>WKHUH�ZDV@�12�SHDFH��DQG�RQH

EXLOW�XS�D�ZDOO��8�1�2��DQG�1$72���DQG��OR��RWKHUV�GDXEHG

LW�ZLWK�XQWHPSHUHG�>PRUWDU@�

������6D\�XQWR�WKHP�ZKLFK�GDXE�>LW@�ZLWK�XQWHPSHUHG

>PRUWDU@��WKDW�LW�VKDOO�IDOO��WKHUH�VKDOO�EH�DQ�RYHUIORZLQJ

VKRZHU��DQG�\H��2�JUHDW�KDLOVWRQHV��VKDOO�IDOO��DQG�D

VWRUP\�ZLQG��2SHUDWLRQ��'HVHUW�6WRUP���VKDOO�UHQG�>LW@�

������/R��ZKHQ�WKH�ZDOO�LV�IDOOHQ��VKDOO�LW�QRW�EH�VDLG�XQWR

\RX��:KHUH�>LV@�WKH�GDXELQJ�ZKHUHZLWK�\H�KDYH�GDXEHG

>LW@"

������7KHUHIRUH�WKXV�VDLWK�WKH�/RUG��,�$0���,�ZLOO�HYHQ

UHQG�>LW@�ZLWK�D�VWRUP\�ZLQG�LQ�P\�IXU\��DQG�WKHUH�VKDOO�EH

DQ�RYHUIORZLQJ�VKRZHU�LQ�0LQH�DQJHU��DQG�JUHDW�KDLOVWRQHV

LQ�>0\@�IXU\�WR�FRQVXPH�>LW@�

������6R�ZLOO�,�EUHDN�GRZQ�WKH�ZDOO�� 8�1���WKDW�\H�KDYH

GDXEHG�ZLWK�XQWHPSHUHG�>PRUWDU@��DQG�EULQJ�LW�GRZQ�WR

WKH�JURXQG��VR�WKDW�WKH�� ,OOXPLQDWL��IRXQGDWLRQ�WKHUHRI

VKDOO�EH�GLVFRYHUHG��DQG�LW�VKDOO�IDOO��DQG�\H�VKDOO�EH

FRQVXPHG�LQ�WKH�PLGVW�WKHUHRI��DQG�\H�VKDOO�NQRZ�WKDW�,

>DP@�WKH��,�$0��

������7KXV�ZLOO�,�DFFRPSOLVK�0\�ZUDWK�XSRQ�WKH�ZDOO

�8�1�2��DQG�1$72���DQG�XSRQ�WKHP�WKDW�KDYH�GDXEHG�LW

ZLWK�XQWHPSHUHG�>PRUWDU@��DQG�ZLOO�VD\�XQWR�\RX��7KH�ZDOO

>LV@�QR�>PRUH@��QHLWKHU�WKH\�WKDW�GDXEHG�LW�

�1RZ�,�KDYH�RQH�PRUH�YLWDO�PHVVDJH�WR�GHOLYHU��$V�,�WROG

\RX��RQH�RI�WKH�IRXU�VSHFLILF�DVVLJQPHQWV�5RWKVFKLOG�JDYH

-DFRE�6FKLII�ZDV�WR�FUHDWH�D�PRYHPHQW�WR�GHVWUR\�UHOLJLRQ

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 62: Fagan Transcript

LQ�WKH�8QLWHG�6WDWHV��ZLWK�&KULVWLDQLW\�WR�EH�WKH�FKLHI

WDUJHW��)RU�D�YHU\�REYLRXV�UHDVRQ��WKH��$QWL�GHIDPDWLRQ

/HDJXH��ZRXOGQW�GDUH�WR�DWWHPSW�WR�GR�LW�EHFDXVH�VXFK�DQ

DWWHPSW�FRXOG�FUHDWH�WKH�PRVW�WHUULEOH�EORRG�EDWK�LQ�WKH

KLVWRU\�RI�WKH�ZRUOG��QRW�RQO\�IRU�WKH��$'/��DQG�WKH

FRQVSLUDWRUV��EXW�IRU�WKH�PLOOLRQV�RI�LQQRFHQW�-HZV��6FKLII

WXUQHG�WKDW�MRE�RYHU�WR�5RFNHIHOOHU�IRU�DQRWKHU�VSHFLILF

UHDVRQ��7KH�GHVWUXFWLRQ�RI�&KULVWLDQLW\�FRXOG�EH

DFFRPSOLVKHG�RQO\�E\�WKRVH�ZKR�DUH�HQWUXVWHG�WR�SUHVHUYH

LW��%\�WKH�SDVWRUV��WKH�PHQ�RI�WKH�FORWK�

��&RULQWKLDQV�������)RU�VXFK�>DUH@� IDOVH �DSRVWOHV�

GHFHLWIXO �ZRUNHUV��WUDQVIRUPLQJ�WKHPVHOYHV�LQWR�WKH

DSRVWOHV�RI�&KULVW�

������$QG�QR�PDUYHO��IRU�6DWDQ�KLPVHOI�LV�WUDQVIRUPHG

LQWR�DQ�DQJHO�RI�OLJKW�

������7KHUHIRUH�>LW�LV@�QR�JUHDW�WKLQJ�LI�KLV�PLQLVWHUV�DOVR

EH�WUDQVIRUPHG�DV�WKH�PLQLVWHUV�RI�ULJKWHRXVQHVV��ZKRVH

HQG�VKDOO�EH�DFFRUGLQJ�WR�WKHLU�ZRUNV�

�$V�D�VWDUWHU��-RKQ�'��5RFNHIHOOHU�SLFNHG�XS�D�\RXQJ�

VR�FDOOHG��&KULVWLDQ�PLQLVWHU�E\�WKH�QDPH�RI�'U��+DUU\�)�

:DUG��5HYHUHQG�:DUG�LI�\RX�SOHDVH��$W�WKDW�WLPH�KH�ZDV

WHDFKLQJ�UHOLJLRQ�DW�WKH��8QLRQ�7KHRORJLFDO�6HPLQDU\��

5RFNHIHOOHU�IRXQG�D�YHU\�ZLOOLQJ��-XGDV��LQ�WKLV�5HYHUHQG

DQG�WKHUHXSRQ�LQ�������KH�ILQDQFHG�KLP�WR�VHW�XS�WKH

�0HWKRGLVW�)RXQGDWLRQ�RI�6RFLDO�6HUYLFH��DQG�:DUGV�MRE

ZDV�WR�WHDFK�EULJKW�\RXQJ�PHQ�WR�EHFRPH��VR�FDOOHG�

PLQLVWHUV�RI�&KULVW�DQG�WR�SODFH�WKHP�DV�SDVWRUV�RI

FKXUFKHV��:KLOH�WHDFKLQJ�WKHP�WR�EHFRPH�PLQLVWHUV��WKH

5HYHUHQG�:DUG�DOVR�WDXJKW�WKHP�KRZ�WR�VXEWO\�DQG

FUDIWLO\�SUHDFK�WR�WKHLU�FRQJUHJDWLRQV�WKDW�WKH�HQWLUH�VWRU\

RI�&KULVW�ZDV�D�P\WK��WR�FDVW�GRXEWV�RQ�WKH�GLYLQLW\�RI

&KULVW��WR�FDVW�GRXEWV�DERXW�WKH� YLUJLQ�0DU\ ��LQ�VKRUW��WR

FDVW�GRXEWV�RQ�&KULVWLDQLW\ �DV�D�ZKROH��,W�ZDV�QRW�WR�EH�D

GLUHFW�DWWDFN��EXW�PXFK�RI�LW�WR�EH�GRQH�E\�FUDIW\�

LQVLQXDWLRQ�WKDW�ZDV�WR�EH�DSSOLHG��LQ�SDUWLFXODU��WR�WKH

\RXWK�LQ�WKH�6XQGD\�VFKRROV��5HPHPEHU�/HQLQV

VWDWHPHQW���JLYH�PH�MXVW�RQH�JHQHUDWLRQ�RI�\RXWK�DQG�,OO

WUDQVIRUP�WKH�ZKROH�ZRUOG���7KHQ�LQ�������WKH��0HWKRGLVW

IRXQGDWLRQ�RI�6RFLDO�6HUYLFH���ZKLFK�LQFLGHQWDOO\�ZDV

$PHULFDV�ILUVW�FRPPXQLVW�IURQW�RUJDQL]DWLRQ��FKDQJHG�LWV

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 63: Fagan Transcript

QDPH�WR�WKH��)HGHUDO�&RXQFLO�RI�&KXUFKHV���%\�������WKH

�)HGHUDO�&RXQFLO�RI�&KXUFKHV��ZDV�EHFRPLQJ�YHU\�VXVSHFW�

VR�LQ������WKH\�FKDQJHG�WKH�QDPH�WR�WKH��1DWLRQDO

&RXQFLO�RI�&KXUFKHV���'R�,�KDYH�WR�WHOO�\RX�PRUH�DERXW

KRZ�WKLV��1DWLRQDO�&RXQFLO�RI�&KXUFKHV��LV�GHOLEHUDWHO\

GHVWUR\LQJ�IDLWK�LQ�&KULVWLDQLW\"�,�GRQW�WKLQN�VR��EXW�WKLV�,

ZLOO�WHOO�\RX��,I�\RX�DUH�D�PHPEHU�RI�DQ\�FRQJUHJDWLRQ

ZKRVH�SDVWRU�DQG�FKXUFK�DUH�PHPEHUV�RI�WKLV�-XGDV

RUJDQL]DWLRQ��\RX�DQG�\RXU�FRQWULEXWLRQV�DUH�KHOSLQJ�WKH

,OOXPLQDWLV�SORW�WR�GHVWUR\�&KULVWLDQLW\�DQG�\RXU�IDLWK�LQ

*RG�DQG�-HVXV�&KULVW��WKXV�\RX�DUH�GHOLEHUDWHO\�GHOLYHULQJ

\RXU�FKLOGUHQ�WR�EH�LQGRFWULQDWHG�ZLWK�GLVEHOLHI�LQ�*RG�DQG

&KXUFK�DQG�ZKLFK�FDQ�HDVLO\�WUDQVIRUP�WKHP�LQWR

�DWKHLVWV���)LQG�RXW�LPPHGLDWHO\�LI�\RXU�&KXUFK�LV�D

PHPEHU�RI�WKH��1DWLRQDO�&RXQFLO�RI�&KXUFKHV��DQG�IRU�WKH

ORYH�RI�*RG�DQG�\RXU�FKLOGUHQ��LI�LW�LV��ZLWKGUDZ�IURP�LW�DW

RQFH��+RZHYHU��OHW�PH�ZDUQ�\RX�WKDW�WKH�VDPH�GHVWUR\LQJ

UHOLJLRQ�SURFHVV�KDV�EHHQ�LQILOWUDWHG�LQWR�RWKHU

GHQRPLQDWLRQV��,I�\RX�KDYH�VHHQ�WKH��1HJUR�RQ�6HOPD�

DQG�RWKHU�VXFK�GHPRQVWUDWLRQV��\RX�KDYH�VHHQ�KRZ�WKH

1HJUR�PREV�DUH�OHG�DQG�HQFRXUDJHG�E\�PLQLVWHUV��DQG

HYHQ� &DWKROLF�SULHVWV�DQG�QXQV ��ZKR�PDUFK�DORQJ�ZLWK

WKHP��7KHUH�DUH�PDQ\�LQGLYLGXDO�FKXUFKHV�DQG�SDVWRUV

ZKR�DUH�KRQHVW�DQG�VLQFHUH��)LQG�RQH�VXFK�IRU�\RXUVHOI

DQG�IRU�\RXU�FKLOGUHQ���$OO�\RX�KDYH�WR�OHDUQ�LV�LI�\RXU

�FKXUFK��LV�D������F����DUP�RI�WKH�VWDWH��,I�LW�LV��\RX�VKRXOG

LPPHGLDWHO\�VWRS�DWWHQGLQJ�LW��DQG�VWRS�VXSSRUWLQJ�LW�ZLWK

\RXU��WD[�GHGXFWLEOH��GRQDWLRQV����'DYLG�*����%HWWHU�VWLOO�

UHDG�WKH� .LQJ�RI�NLQJV�%LEOH �H[FHUSW���0DWWKHZ���������

DW�WKH�HQG�RI�WKLV�DUWLFOH��

�(SKHVLDQV������7KDW�ZH�>KHQFHIRUWK@�EH�QR�PRUH

FKLOGUHQ��WRVVHG�WR�DQG�IUR��DQG�FDUULHG�DERXW�ZLWK�HYHU\

ZLQG�RI�GRFWULQH��E\�WKH�VOHLJKW�RI�PHQ��>DQG@�FXQQLQJ

FUDIWLQHVV��ZKHUHE\�WKH\�OLH�LQ�ZDLW�WR�GHFHLYH�

*DODWLDQV�����$QG�WKDW�EHFDXVH�RI� IDOVH �EUHWKUHQ

XQDZDUHV�EURXJKW�LQ��ZKR�FDPH�LQ�SULYLO\�WR�VS\�RXW�RXU

OLEHUW\�ZKLFK�ZH�KDYH�LQ�&KULVW�-HVXV��WKDW�WKH\�PLJKW

EULQJ�XV�LQWR�ERQGDJH�

��&RULQWKLDQV�������)RU�VXFK�>DUH@� IDOVH �DSRVWOHV�

GHFHLWIXO �ZRUNHUV��WUDQVIRUPLQJ�WKHPVHOYHV�LQWR�WKH

DSRVWOHV�RI�&KULVW�

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 64: Fagan Transcript

�,QFLGHQWDOO\��WKLV�VDPH�5HYHUHQG�+DUU\�)��:DUG�ZDV�DOVR

RQH�RI�WKH�IRXQGHUV�RI�WKH��$PHULFDQ�&LYLO�/LEHUWLHV

8QLRQ���D�QRWRULRXV�SUR�&RPPXQLVW�RUJDQL]DWLRQ��+H�ZDV

WKH�DFWXDO�KHDG�RI�LW�IURP������WR�������+H�DOVR�ZDV�D

FR�IRXQGHU�RI�WKH��$PHULFDQ�/HDJXH�DJDLQVW�:DU�DQG

)DVFLVP��ZKLFK��XQGHU�%URZGHU��EHFDPH�WKH��&RPPXQLVW

3DUW\�RI�WKH�8QLWHG�6WDWHV���,Q�VKRUW��:DUGV�HQWLUH

EDFNJURXQG�UHHNHG�RI�FRPPXQLVP�DQG�KH�ZDV�LGHQWLILHG

DV�D�PHPEHU�RI�WKH�&RPPXQLVW�SDUW\��+H�GLHG�D�YLFLRXV

WUDLWRU�WR�ERWK�KLV�FKXUFK�DQG�FRXQWU\�DQG�WKLV�ZDV�WKH

PDQ�ROG�-RKQ�'��5RFNHIHOOHU�SLFNHG�DQG�ILQDQFHG�WR

GHVWUR\�$PHULFDV�&KULVWLDQ�UHOLJLRQ�LQ�DFFRUGDQFH�ZLWK�WKH

RUGHUV�JLYHQ�WR�6FKLII�E\�WKH�5RWKVFKLOGV�

�,Q�FRQFOXVLRQ�,�KDYH�WKLV�WR�VD\��<RX�SUREDEO\�DUH�IDPLOLDU

ZLWK�WKH�VWRU\�RI�KRZ�RQH�'U��)UDQNHQVWHLQ�FUHDWHG�D

PRQVWHU�WR�GR�KLV�ZLOO�RI�GHVWUR\LQJ�KLV�FKRVHQ�YLFWLPV�EXW

KRZ�LQVWHDG�LQ�WKH�HQG��WKDW�PRQVWHU�WXUQHG�RQ�KLV�RZQ

FUHDWRU��)UDQNHQVWHLQ��DQG�GHVWUR\HG�KLP��:HOO��WKH

,OOXPLQDWL�&)5�KDV�FUHDWHG�D�PRQVWHU�FDOOHG�WKH��8QLWHG

1DWLRQV���ZKR�LV�VXSSRUWHG�E\�WKHLU�PLQRULW\�JURXSV�

ULRWLQJ�1HJURHV��WKH�WUDLWRURXV�PDVV�FRPPXQLFDWLRQV

PHGLD��DQG�WKH�WUDLWRUV�LQ�:DVKLQJWRQ�'�&���ZKLFK�ZDV

FUHDWHG�WR�GHVWUR\�WKH�$PHULFDQ�SHRSOH��:H�NQRZ�DOO

DERXW�WKDW�PDQ\�KHDGHG�K\GURPRQVWHU�DQG�ZH�NQRZ�WKH

QDPHV�RI�WKRVH�ZKR�FUHDWHG�WKDW�PRQVWHU��:H�NQRZ�DOO

WKHLU�QDPHV�DQG�,�SUHGLFW�WKDW�RQH�ILQH�GD\�WKH�$PHULFDQ

SHRSOH�ZLOO�FRPH�IXOO\�DZDNH�DQG�FDXVH�WKDW�YHU\�PRQVWHU

WR�GHVWUR\�LWV�FUHDWRU��7UXH��7KH�PDMRULW\�RI�RXU�SHRSOH�DUH

VWLOO�EHLQJ�EUDLQZDVKHG��GHFHLYHG��DQG�GHOXGHG�E\�RXU

WUDLWRURXV�SUHVV��79��DQG�UDGLR��DQG�E\�RXU�WUDLWRUV�LQ

:DVKLQJWRQ�'�&���EXW�VXUHO\�E\�QRZ�HQRXJK�LV�NQRZQ

DERXW�WKH�8�1��WR�VWDPS�RXW�WKDW�RXWILW�DV�D�GHDGO\

SRLVRQRXV�UDWWOHVQDNH�LQ�RXU�PLGVW�

(]HNLHO������$QG�WKH�:RUG�RI�WKH��,�$0��FDPH�XQWR�PH�

VD\LQJ�

�����6RQ�RI�PDQ��SURSKHV\�DJDLQVW�WKH�SURSKHWV�RI�,VUDHO

WKDW�SURSKHV\��DQG�VD\�WKRX�XQWR�WKHP�WKDW�SURSKHV\�RXW

RI�WKHLU�RZQ�KHDUWV��+HDU�\H�WKH�:RUG�RI�WKH��,�$0��

�����7KXV�VDLWK�WKH�/RUG��,�$0���:RH�XQWR�WKH�IRROLVK

SURSKHWV��SROLWLFLDQV���WKDW�IROORZ�WKHLU�RZQ�VSLULW��DQG�KDYH

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 65: Fagan Transcript

VHHQ�QRWKLQJ�

�����2�,VUDHO��%ULWDLQ�DQG�8�6�$���� WKH�7ZR�:LWQHVVHV�DQG

UHODWHG�QDWLRQV���WK\�SURSKHWV��SROLWLFLDQV��DUH�OLNH�WKH

�IR[HV�LQ�WKH�GHVHUWV���2SHUDWLRQ��'HVHUW�)R[���

�����<H�KDYH�QRW�JRQH�XS�LQWR�WKH�JDSV��QHLWKHU�PDGH�XS

WKH�KHGJH�IRU�WKH��+RXVH�RI�,VUDHO���WKH�7HQ��/RVW��7ULEHV

RI�,VUDHO��ZKLFK�LQFOXGH�DQG�DUH�OHG�E\�$PHULFD�DQG�%ULWDLQ�

WR�VWDQG�LQ�WKH�EDWWOH�LQ�7KH�'D\�RI�WKH��,�$0�

�$UPDJHGGRQ��

�����7KH\�KDYH�VHHQ�YDQLW\�DQG�O\LQJ�GLYLQDWLRQ��VD\LQJ�

7KH��,�$0��VDLWK��DQG�WKH��,�$0��KDWK�QRW�VHQW�WKHP��DQG

WKH\�KDYH�PDGH�>RWKHUV@�WR�KRSH�WKDW�WKHLU�ZRUGV�ZRXOG

EH�FRQILUPHG�

�����+DYH�\H�QRW�VHHQ�D�YDLQ�YLVLRQ��DQG�KDYH�\H�QRW

VSRNHQ�D�O\LQJ�GLYLQDWLRQ��ZKHUHDV�\H�VD\��7KH��,�$0��VDLWK

>LW@��DOEHLW�,�KDYH�QRW�VSRNHQ"

�����7KHUHIRUH�WKXV�VDLWK�WKH�/RUG��,�$0���%HFDXVH�\H

KDYH�VSRNHQ�YDQLW\��DQG�VHHQ�OLHV��WKHUHIRUH��EHKROG��,

>DP@�DJDLQVW�\RX��VDLWK�WKH�/RUG��,�$0��

�����$QG�0LQH�KDQG�VKDOO�EH�XSRQ�WKH�SURSKHWV

�SROLWLFLDQV��WKDW�VHH�YDQLW\��DQG�WKDW�GLYLQH�OLHV��WKH\�VKDOO

QRW�EH�LQ�WKH�DVVHPEO\�RI�0\�SHRSOH��QHLWKHU�VKDOO�WKH\�EH

ZULWWHQ�LQ�WKH�ZULWLQJ�RI�WKH��+RXVH�RI�,VUDHO���QHLWKHU�VKDOO

WKH\�HQWHU�LQWR�WKH�ODQG�RI�,VUDHO��DQG�\H�VKDOO�NQRZ�WKDW�,

>DP@�WKH�/RUG��,�$0��

������%HFDXVH��HYHQ�EHFDXVH�WKH\�KDYH�VHGXFHG�0\

SHRSOH��VD\LQJ��3HDFH��DQG�>WKHUH�ZDV@�12�SHDFH��DQG�RQH

EXLOW�XS�D�ZDOO��8�1�2��DQG�1$72���DQG��OR��RWKHUV�GDXEHG

LW�ZLWK�XQWHPSHUHG�>PRUWDU@�

������6D\�XQWR�WKHP�ZKLFK�GDXE�>LW@�ZLWK�XQWHPSHUHG

>PRUWDU@��WKDW�LW�VKDOO�IDOO��WKHUH�VKDOO�EH�DQ�RYHUIORZLQJ

VKRZHU��DQG�\H��2�JUHDW�KDLOVWRQHV��VKDOO�IDOO��DQG�D

VWRUP\�ZLQG��2SHUDWLRQ��'HVHUW�6WRUP���VKDOO�UHQG�>LW@�

������/R��ZKHQ�WKH�ZDOO�LV�IDOOHQ��VKDOO�LW�QRW�EH�VDLG�XQWR

\RX��:KHUH�>LV@�WKH�GDXELQJ�ZKHUHZLWK�\H�KDYH�GDXEHG

>LW@"

������7KHUHIRUH�WKXV�VDLWK�WKH�/RUG��,�$0���,�ZLOO�HYHQ

UHQG�>LW@�ZLWK�D�VWRUP\�ZLQG�LQ�P\�IXU\��DQG�WKHUH�VKDOO�EH

DQ�RYHUIORZLQJ�VKRZHU�LQ�0LQH�DQJHU��DQG�JUHDW�KDLOVWRQHV

LQ�>0\@�IXU\�WR�FRQVXPH�>LW@�

������6R�ZLOO�,�EUHDN�GRZQ�WKH�ZDOO��8�1���WKDW�\H�KDYH

GDXEHG�ZLWK�XQWHPSHUHG�>PRUWDU@��DQG�EULQJ�LW�GRZQ�WR

WKH�JURXQG��VR�WKDW�WKH��,OOXPLQDWL��IRXQGDWLRQ�WKHUHRI

VKDOO�EH�GLVFRYHUHG��DQG�LW�VKDOO�IDOO��DQG�\H�VKDOO�EH

FRQVXPHG�LQ�WKH�PLGVW�WKHUHRI��DQG�\H�VKDOO�NQRZ�WKDW�,

>DP@�WKH��,�$0��

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 66: Fagan Transcript

������7KXV�ZLOO�,�DFFRPSOLVK�0\�ZUDWK�XSRQ�WKH�ZDOO

�8�1�2��DQG�1$72���DQG�XSRQ�WKHP�WKDW�KDYH�GDXEHG�LW

ZLWK�XQWHPSHUHG�>PRUWDU@��DQG�ZLOO�VD\�XQWR�\RX��7KH�ZDOO

>LV@�QR�>PRUH@��QHLWKHU�WKH\�WKDW�GDXEHG�LW�

������>7R�ZLW@��WKH�SURSKHWV��SROLWLFLDQV��RI�,VUDHO�ZKLFK

SURSKHV\�FRQFHUQLQJ�-HUXVDOHP��DQG�ZKLFK�VHH�YLVLRQV�RI

SHDFH�IRU�KHU��DQG�>WKHUH�LV@�QR�SHDFH��VDLWK�WKH�/RUG��,

$0��

������/LNHZLVH��WKRX�VRQ�RI�PDQ��VHW�WK\�IDFH�DJDLQVW�WKH

GDXJKWHUV�RI�WK\�SHRSOH��ZKLFK�SURSKHV\�RXW�RI�WKHLU�RZQ

KHDUW��DQG�SURSKHV\�WKRX�DJDLQVW�WKHP�

������$QG�VD\��7KXV�VDLWK�WKH�/RUG��,�$0���:RH�WR�WKH

>ZRPHQ@�WKDW�VHZ�SLOORZV�WR�DOO�DUPKROHV��SDGGHG

VKRXOGHUV���DQG�PDNH�NHUFKLHIV��IDVKLRQ�KDWV��XSRQ�WKH

KHDG�RI�HYHU\�VWDWXUH�WR�KXQW�VRXOV��:LOO�\H�KXQW�WKH�VRXOV

RI�0\�SHRSOH��DQG�ZLOO�\H�VDYH�WKH�VRXOV�DOLYH�>WKDW�FRPH@

XQWR�\RX"

������$QG�ZLOO�\H�SROOXWH�0H�DPRQJ�0\�SHRSOH�IRU�KDQGIXOV

RI�EDUOH\�DQG�IRU�SLHFHV�RI�EUHDG��WR�VOD\�WKH�VRXOV�WKDW

VKRXOG�QRW�GLH��DQG�WR�VDYH�WKH�VRXOV�DOLYH�WKDW�VKRXOG�QRW

OLYH��E\�\RXU�O\LQJ�WR�0\�SHRSOH�WKDW�KHDU�>\RXU@�OLHV"

������:KHUHIRUH�WKXV�VDLWK�WKH�/RUG��,�$0���%HKROG��,

>DP@�DJDLQVW�\RXU�SLOORZV��ZKHUHZLWK�\H�WKHUH�KXQW�WKH

VRXOV�WR�PDNH�>WKHP@�IO\��DQG�,�ZLOO�WHDU�WKHP�IURP�\RXU

DUPV��DQG�ZLOO�OHW�WKH�VRXOV�JR��>HYHQ@�WKH�VRXOV�WKDW�\H

KXQW�WR�PDNH�>WKHP@�IO\�

������<RXU�NHUFKLHIV�DOVR�ZLOO�,�WHDU��DQG�GHOLYHU�0\�SHRSOH

RXW�RI�\RXU�KDQG��DQG�WKH\�VKDOO�EH�QR�PRUH�LQ�\RXU�KDQG

WR�EH�KXQWHG��DQG�\H�VKDOO�NQRZ�WKDW�,�>DP@�WKH��,�$0��

������%HFDXVH�ZLWK�OLHV�\H�KDYH�PDGH�WKH�KHDUW�RI�WKH

ULJKWHRXV�VDG��ZKRP�,�KDYH�QRW�PDGH�VDG��DQG

VWUHQJWKHQHG�WKH�KDQGV�RI�WKH�ZLFNHG��WKDW�KH�VKRXOG�QRW

UHWXUQ�IURP�KLV�ZLFNHG�ZD\��E\�SURPLVLQJ�KLP�OLIH�

������7KHUHIRUH�\H�VKDOO�VHH�QR�PRUH�YDQLW\��QRU�GLYLQH

GLYLQDWLRQV��IRU�,�ZLOO�GHOLYHU�0\�SHRSOH�RXW�RI�\RXU�KDQG�

DQG�\H�VKDOO�NQRZ�WKDW�,�>DP@�WKH��,�$0��

�0\�RQO\�ZRQGHU�LV���ZKDW�ZLOO�LW�WDNH�WR�DZDNHQ�DQG

DURXVH�RXU�SHRSOH�WR�WKH�IXOO�SURRI"��3HUKDSV�WKLV�UHFRUG

�WUDQVFULSW��ZLOO�GR�LW��$�KXQGUHG�WKRXVDQG�RU�D�PLOOLRQ

FRSLHV�RI�WKLV�UHFRUG��WKLV�WUDQVFULSW��FDQ�GR�LW��,�SUH\�WR

*RG�LW�ZLOO��$QG�,�SUD\�WKDW�WKLV�UHFRUG��WUDQVFULSW��ZLOO

LQVSLUH�\RX��DOO�RI�\RX��WR�VSUHDG�WKLV�VWRU\�WR�DOO�OR\DO

$PHULFDQV�LQ�\RXU�FRPPXQLW\��<RX�FDQ�GR�LW�E\�SOD\LQJ�LW

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 67: Fagan Transcript

�UHDGLQJ�LW��WR�VWXG\�JURXSV�DVVHPEOHG�LQ�\RXU�KRPHV��DW

PHHWLQJV�RI�WKH�$PHULFDQ�/HJLRQ��WKH�9):��WKH�'$5��DOO

RWKHU�FLYLF�JURXSV�DQG�ZRPHQV�FOXEV��HVSHFLDOO\�WKH

ZRPHQV�FOXEV�ZKR�KDYH�WKHLU�VRQV�OLYHV�DW�VWDNH��:LWK

WKLV�UHFRUG��WUDQVFULSW��,�KDYH�SURYLGHG�\RX�ZLWK�WKH

ZHDSRQ�WKDW�ZLOO�GHVWUR\�WKH�PRQVWHU��)RU�WKH�ORYH�RI�*RG�

RI�RXU�&RXQWU\��DQG�RI�\RXU�FKLOGUHQ��XVH�LW��*HW�D�FRS\�RI

LW�LQWR�HYHU\�$PHULFDQ�KRPH�

2EDGLDK �����+RZ�DUH�>WKH�WKLQJV@�RI�(VDX��(GRP��

,GXPDHDQV��VHDUFKHG�RXW��>KRZ@�DUH�KLV�KLGGHQ�WKLQJV

VRXJKW�XS�

����$OO�WKH�PHQ�RI�WK\�FRQIHGHUDF\�KDYH�EURXJKW�WKHH

>HYHQ@�WR�WKH�ERUGHU��WKH�PHQ�WKDW�ZHUH�DW�SHDFH�ZLWK

WKHH�KDYH�GHFHLYHG�WKHH��>DQG@�SUHYDLOHG�DJDLQVW�WKHH�

>WKH\�WKDW�HDW@�WK\�EUHDG�KDYH�ODLG�D�ZRXQG�XQGHU�WKHH�

>WKHUH�LV@�QRQH�XQGHUVWDQGLQJ�LQ�KLP�

����6KDOO�,�QRW�LQ�WKDW�GD\��VDLWK�WKH��,�$0���HYHQ�GHVWUR\

WKH�ZLVH�>PHQ@�RXW�RI�(GRP��,GXPDHDQV���DQG

XQGHUVWDQGLQJ�RXW�RI�WKH�PRXQW�RI�(VDX"

������������������������������

$V�PRUH�DQG�PRUH�SHRSOH�EHJLQ�WR�VWDUYH�WR�GHDWK�DURXQG

WKH�ZRUOG��EHFDXVH�RI�DFWLRQV�GLUHFWO\�UHODWHG�WR

:DVKLQJWRQ��'&��SHUKDSV�PRUH�$PHULFDQV�ZLOO�EHJLQ�WR

XQGHUVWDQG�ZK\�-XGJPHQW�ZLOO�FRPH�DJDLQVW�WKHP��7KH

8QLWHG�6WDWHV��QRW�$PHULFD���LV�WKH�1HZ�:RUOG�2UGHU��DQG

PRVW�RI�WKH�UHVW�RI�WKH�ZRUOG�XQGHUVWDQGV�WKLV��3OHDVH�UHDG

DERXW�WKH�7ZR�:LWQHVVHV�DQG�WKHLU�SXQLVKPHQW�

3OHDVH�WKLQN�DERXW�WKLV��2QO\�LQ�$PHULFD����GR�ZH�XVH�WKH

ZRUG�SROLWLFV�WR�GHVFULEH�WKH�SURFHVV�VR�ZHOO��3ROL�LQ�/DWLQ

PHDQLQJ�PDQ\�DQG�WLFV�PHDQLQJ�EORRGVXFNLQJ

FUHDWXUHV�

,�XUJH�\RX�WR�SDVV�WKLV�LQIRUPDWLRQ�RQ�WR�RWKHUV��RU�SRVW�LW

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 68: Fagan Transcript

DV�\RX�VHH�ILW�WR�WKH�,QWHUQHW�RU�E\�UHJXODU�PDLO��XQDOWHUHG

LQ�DQ\�ZD\��DV�RWKHUV�PD\�QHHG�WR�XQGHUVWDQG�ZKDW�LV

JRLQJ�RQ��:H�DOO�KDYH�D�PRUDO�REOLJDWLRQ�WR�KHOS

XQGHUVWDQGLQJ�DQG�NQRZOHGJH�VSUHDG�DFURVV�$PHULFD�DQG

WKH�ZRUOG�

.�-�$�9��(]HNLHO������%XW�LI�WKH�ZDWFKPDQ�VHH�WKH�VZRUG

FRPH��DQG�EORZ�QRW�WKH�WUXPSHW��DQG�WKH�SHRSOH�EH�QRW

ZDUQHG��LI�WKH�VZRUG�FRPH��DQG�WDNH�>DQ\@�SHUVRQ�IURP

DPRQJ�WKHP��KH�LV�WDNHQ�DZD\�LQ�KLV�LQHTXLW\��EXW�KLV

EORRG�ZLOO�,�UHTXLUH�DW�WKH�ZDWFKPDQV�KDQG�

7KH�FRVW�RI�OLEHUW\�LV�HWHUQDO�YLJLODQFH��WKLV�LV�WKH�OHVVRQ

WKDW�$PHULFD�IRUJRW�LQ�WKH�HQMR\PHQW�RI�WKH�H[FHVV�RI

PDWHULDOLVP��DQG�LQ�WKH�RUJ\�RI�SOXQGHULQJ�WKH�ZRUOG�ZLWK

XQMXVW�ZHLJKWV�DQG�PHDVXUHV���5HYHODWLRQ������

7R�XQGHUVWDQG�WKH�ZRUOG�DURXQG�\RX�LW�LV�QHFHVVDU\�WR

XQGHUVWDQG�6FULSWXUH��DQG�RQH�SLHFH�RI�LQIRUPDWLRQ�IURP

6FULSWXUH�LV�SDUWLFXODUO\�WHOOLQJ��� WKH�/29(�RI�PRQH\�LV

WKH�URRW�RI�$//�HYLO ���1RW�VRPH�HYLO��QRW�PRVW�HYLO�� $//

HYLO��3ULYDWH�FRXUWV�WKH�,56�XVHV�DUH�VLPSO\�DQRWKHU�ZD\

WR�SUH\�RQ�WKH�XQLQIRUPHG��SOHDVH��GR�QRW�VWD\

XQLQIRUPHG��/HDUQ�ZKDW�LV�UHDOO\�JRLQJ�RQ�LQ�$PHULFD�DQG

DURXQG�WKH�ZRUOG�

,I�\RX�DUH�LQWHUHVWHG�LQ�UHVWRULQJ�)UHHGRP�DQG�-XVWLFH�

VWXG\�WKLV�ZHEVLWH�DQG�OHWV�JHW�VWDUWHG��2U��YLVLW�WKH�ZHE

SDJHV�RQ�WKLV�VLWH��OHDUQ�DQG�JHW�VWDUWHG��:KDWHYHU�\RX

GR��MXVW�JHW�VWDUWHG��$QG�IRU�WKRVH�RI�\RX�ZKR�KDYH�EHHQ

UHDGLQJ�DQG�VWRSSHG�IRU�VRPH�UHDVRQ��DQ\�UHDVRQ��SOHDVH

FRQWLQXH��DQG�WKLV�LQIRUPDWLRQ�ZLOO�FKDQJH�KRZ�\RX�ORRN�DW

WKH�ZRUOG�DURXQG�\RX��LQ�VRPH�ZD\V��GUDVWLFDOO\��0D\

<+:+�%OHVV�\RX�*UHDWO\��'DYLG�*�

�0RVW�SHRSOH��VRPHWLPH�LQ�WKHLU�OLYHV��VWXPEOH�DFURVV

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 69: Fagan Transcript

WUXWK��0RVW�MXPS�XS��EUXVK�WKHPVHOYHV�RII��DQG�KXUU\�RQ

DERXW�WKHLU�EXVLQHVV�DV�LI�QRWKLQJ�KDG�KDSSHQHG�����6LU

:LQVWRQ�&KXUFKLOO

:KHQ�D�PDQ�ZKR�LV�KRQHVWO\�PLVWDNHQ�KHDUV�WKH�WUXWK��KH

ZLOO�HLWKHU�TXLW�EHLQJ�PLVWDNHQ�RU�FHDVH�WR�EH�KRQHVW�

/DZ\HUV�������SHUFHQW�RI�WKHP�JLYH�WKH�UHVW�RI�WKH

SURIHVVLRQ�D�EDG�QDPH�

,�GRQW�WKLQN�\RX�FDQ�PDNH�D�ODZ\HU�KRQHVW�E\�DQ�DFW�RI

OHJLVODWLRQ��<RXYH�JRW�WR�ZRUN�RQ�KLV�FRQVFLHQFH��$QG�KLV

ODFN�RI�FRQVFLHQFH�LV�ZKDW�PDNHV�KLP�D�ODZ\HU����:LOO

5RJHUV������������

:KDW�GLG�-HVXV�WHOO�XV�DERXW�ODZ\HUV�DQG�SROLWLFLDQV��PRVW

RI�ZKRP�DUH�DOVR�ODZ\HUV���

.LQJ�RI�NLQJV�%LEOH��*RVSHO�RI�0DWWKHZ��

�����7KHQ�VSRNH�-HVXV�WR�WKH�PXOWLWXGH��DQG�WR�KLV

GLVFLSOHV�

�����6D\LQJ��7KH� ODZ\HUV �DQG�WKH� SROLWLFLDQV �VLW�LQ

0RVHV�/DZ�VHDW�

�����$OO�WKHUHIRUH�ZKDWVRHYHU�WKH\�ELG�\RX�REVHUYH�RI

*RGV�/DZ��>WKDW@�REVHUYH�DQG�GR��EXW�GR�QRW�\H�DIWHU�WKHLU

H[DPSOH��IRU�WKH\�VD\��DQG�GR�QRW��DQG�PDNH�XS�WKHLU�RZQ

ODZV�DJDLQVW�*RGV�2UGHUV���'HXW�������

�����)RU�WKH\�ELQG�KHDY\�EXUGHQV��WKH�7DOPXG��DQG

JULHYRXV�WR�EH�ERUQH��DQG�OD\�>WKHP@�RQ�PHQV�VKRXOGHUV�

EXW�WKH\�>WKHPVHOYHV@�ZLOO�QRW�OLIW�RQH�RI�WKHLU�ILQJHUV�WR

UHPRYH�WKHP�

�����%XW�DOO�WKHLU�ZRUNV�WKH\�GR�IRU�WR�EH�VHHQ�E\�PHQ�

WKH\�PDNH�EURDG�WKHLU�SK\ODFWHULHV��VPDOO�OHDWKHU�ER[

FRQWDLQLQJ�2OG�&RYHQDQW�7HVWDPHQW�WH[WV��ZRUQ�WR�UHPLQG

WKHP�WR�NHHS�7KH�/DZ�>*RGV�/DZ@���DQG�HQODUJH�WKH

ERUGHUV�RI�WKHLU�JDUPHQWV�

�����$QG�ORYH�WKH�XSSHUPRVW�URRPV�DW�IHDVWV��DQG�WKH

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 70: Fagan Transcript

FKLHI�VHDWV�LQ�WKH�FKXUFKHV�

�����$QG�JUHHWLQJV�LQ�WKH�PDUNHWV��DQG�WR�EH�FDOOHG�E\

PHQ��3ULHVW��5DEEL��,PDP��HWF�

�����%XW�EH� QRW�\H�FDOOHG�SULHVW��HWF����IRU�2QH�LV�\RXU

7HDFKHU��>HYHQ@�&KULVW��DQG�DOO�\H�DUH�EUHWKUHQ�

�����$QG�FDOO�QR�>PDQ@�\RXU�IDWKHU�XSRQ�WKH�HDUWK��IRU

RQH�LV�\RXU�)DWKHU��ZKLFK�LV�LQ�KHDYHQ�

������1HLWKHU�EH�\H�FDOOHG�PDVWHUV��IRU�RQH�LV�\RXU

0DVWHU��>HYHQ@�&KULVW�

������%XW�KH�WKDW�LV�JUHDWHVW�DPRQJ�\RX�VKDOO�EH�\RXU

VHUYDQW�

������$QG�ZKRVRHYHU�VKDOO�H[DOW�KLPVHOI�VKDOO�EH�DEDVHG�

DQG�KH�WKDW�VKDOO�KXPEOH�KLPVHOI�VKDOO�EH�H[DOWHG�

������%XW�ZRH�XQWR�\RX��ODZ\HUV�DQG��3KDULVHHV���)DUVLV��

3HUVLDQ�FRQYHUWV�WR�-XGDLVP��ZKR�ZHUH�WKH��SROLWLFLDQV�

K\SRFULWHV��)RU�\H�VKXW�XS�WKH�.LQJGRP�RI�KHDYHQ�DJDLQVW

PHQ��IRU�\H�QHLWKHU�JR�LQ�>\RXUVHOYHV@��QHLWKHU�DOORZ�\H

WKHP�WKDW�DUH�HQWHULQJ�WR�JR�LQ��VHH�(QRFK���������������

������:RH�XQWR�\RX��ODZ\HUV�DQG�SROLWLFLDQV��K\SRFULWHV�

IRU�\H�GHYRXU�ZLGRZV�KRXVHV��DQG�IRU�D�SUHWHQFH�PDNH

ORQJ�SUD\HU��WKHUHIRUH�\H�VKDOO�UHFHLYH�WKH�JUHDWHU

GDPQDWLRQ�

������:RH�XQWR�\RX��ODZ\HUV�DQG�SROLWLFLDQV��K\SRFULWHV�

IRU�\H�FRPSDVV�VHD�DQG�ODQG�WR�PDNH�RQH�FRQYHUW��DQG

ZKHQ�KH�LV�PDGH��\H�PDNH�KLP�WZRIROG�PRUH�WKH�FKLOG�RI

KHOO�ILUH�WKDQ�\RXUVHOYHV�

������:RH�XQWR�\RX��>\H@�EOLQG�JXLGHV��ZKLFK�VD\�

:KRVRHYHU�VKDOO�VZHDU�E\�WKH�7HPSOH��LW�LV�QRWKLQJ��EXW

ZKRVRHYHU�VKDOO�VZHDU�E\�WKH�JROG�RI�WKH�7HPSOH��KH�LV�D

GHEWRU�

������><H@�IRROV�DQG�EOLQG��IRU�ZKHWKHU�LV�JUHDWHU��WKH

JROG��RU�WKH�7HPSOH�WKDW�VDQFWLILHWK�WKH�JROG"

������$QG��:KRVRHYHU�VKDOO�VZHDU�E\�WKH�DOWDU��LW�LV

QRWKLQJ��EXW�ZKRVRHYHU�VZHDUHWK�E\�WKH�JLIW�WKDW�LV�XSRQ

LW��KH�LV�JXLOW\�

������><H@�IRROV�DQG�EOLQG��IRU�ZKHWKHU�>LV@�JUHDWHU��WKH

JLIW��RU�WKH�DOWDU�WKDW�VDQFWLILHWK�WKH�JLIW"

������:KRVR�WKHUHIRUH�VKDOO�VZHDU�E\�WKH�DOWDU��VZHDUHWK

E\�LW��DQG�E\�DOO�WKLQJV�WKHUHRQ�

������$QG�ZKRVR�VKDOO�VZHDU�E\�WKH�7HPSOH��VZHDUHWK�E\

LW��DQG�E\�+LP�WKDW�GZHOOHWK�WKHUHLQ�

������$QG�KH�WKDW�VKDOO�VZHDU�E\�KHDYHQ��VZHDUHWK�E\�WKH

7KURQH�RI�WKH�.LQJ�RI�WKH�8QLYHUVH��*RG���DQG�E\�+LP�WKDW

VLWWHWK�WKHUHRQ�

������:RH�XQWR�\RX��ODZ\HUV�DQG�SROLWLFLDQV��K\SRFULWHV�

IRU�\H�SD\�WLWKH�RI�PLQW�DQG�DQLVH�DQG�FXPPLQ��DQG�KDYH

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 71: Fagan Transcript

RPLWWHG�WKH�ZHLJKWLHU�>PDWWHUV@�RI� WKH�/DZ ��-XGJPHQW�

0HUF\��DQG�)DLWK��WKHVH�RXJKW�\H�WR�KDYH�GRQH��DQG�QRW�WR

OHDYH�WKH�RWKHU�XQGRQH�

������><H@�EOLQG�JXLGHV��ZKLFK�VWUDLQ�DW�D�JQDW��DQG

VZDOORZ�D�FDPHO�

������:RH�XQWR�\RX��ODZ\HUV�DQG�SROLWLFLDQV��K\SRFULWHV�

IRU�\H�PDNH�FOHDQ�WKH�RXWVLGH�RI�WKH�FXS�DQG�RI�WKH

SODWWHU��EXW�ZLWKLQ�WKH\�DUH�IXOO�RI�H[WRUWLRQ�DQG�H[FHVV�

������>7KRX@�EOLQG�SROLWLFLDQ��FOHDQVH�ILUVW�WKDW�>ZKLFK�LV@

ZLWKLQ�WKH�FXS�DQG�SODWWHU��WKDW�WKH�RXWVLGH�RI�WKHP�PD\

EH�FOHDQ�DOVR�

������:RH�XQWR�\RX��ODZ\HUV�DQG�SROLWLFLDQV��K\SRFULWHV�

IRU�\H�DUH�OLNH�XQWR�ZKLWHG�VHSXOFKUHV��ZKLFK�LQGHHG

DSSHDU�EHDXWLIXO�RXWZDUG��EXW�DUH�ZLWKLQ�IXOO�RI�GHDG

>PHQV@�ERQHV��DQG�RI�DOO�ILOWKLQHVV�

������(YHQ�VR�\H�DOVR�RXWZDUGO\�DSSHDU�ULJKWHRXV�XQWR

PHQ��EXW�ZLWKLQ�\H�DUH�IXOO�RI�K\SRFULV\�DQG�LQHTXLW\�

������:RH�XQWR�\RX��ODZ\HUV�DQG�SROLWLFLDQV��K\SRFULWHV�

%HFDXVH�\H�EXLOG�WKH�WRPEV�RI�WKH�3URSKHWV��DQG�JDUQLVK

WKH�VHSXOFKUHV�RI�WKH�ULJKWHRXV�

������$QG�VD\��,I�ZH�KDG�EHHQ�LQ�WKH�GD\V�RI�RXU�IDWKHUV�

ZH�ZRXOG�QRW�KDYH�EHHQ�SDUWDNHUV�ZLWK�WKHP�LQ�WKH�EORRG

RI�WKH�3URSKHWV�

������:KHUHIRUH�\H�EH�ZLWQHVVHV�XQWR�\RXUVHOYHV��WKDW�\H

DUH�WKH�FKLOGUHQ�RI�WKHP�ZKLFK�NLOOHG�WKH�3URSKHWV�

������)LOO�\H�XS�WKHQ�WKH�PHDVXUH�RI�\RXU�IDWKHUV�

������><H@�VHUSHQWV��>\H@�JHQHUDWLRQ�RI�YLSHUV��KRZ�FDQ

\H�HVFDSH�WKH�GDPQDWLRQ�RI�KHOO�ILUH"

������:KHUHIRUH��EHKROG��,�VHQG�XQWR�\RX�3URSKHWV��DQG

ZLVH�PHQ��DQG�VFULEHV��DQG�>VRPH@�RI�WKHP� \H�VKDOO�NLOO

DQG�FUXFLI\��DQG�>VRPH@�RI�WKHP�VKDOO�\H�VFRXUJH�LQ�\RXU

FKXUFKHV��DQG�SHUVHFXWH�>WKHP@�IURP�FLW\�WR�FLW\�

������7KDW�XSRQ�\RX�PD\�FRPH�DOO�WKH�ULJKWHRXV�EORRG

VKHG�XSRQ�WKH�HDUWK��IURP�WKH�EORRG�RI�ULJKWHRXV�$EHO

XQWR�WKH�EORRG�RI�=DFKDULDV�VRQ�RI�%DUDFKLDV��ZKRP�\H

VOHZ�EHWZHHQ�WKH�7HPSOH�DQG�WKH�DOWDU�

������9HULO\�,�VD\�XQWR�\RX��$OO�WKHVH�WKLQJV�VKDOO�FRPH

XSRQ�WKLV�JHQHUDWLRQ�

������2�-HUXVDOHP��-HUXVDOHP��>WKRX@�WKDW�NLOOHVW�WKH

3URSKHWV��DQG�VWRQHVW�WKHP�ZKLFK�DUH�VHQW�XQWR�WKHH��KRZ

RIWHQ�ZRXOG�,�KDYH�JDWKHUHG�WK\�FKLOGUHQ��6XUD������

WRJHWKHU��HYHQ�DV�D�KHQ�JDWKHUHWK�KHU�FKLFNHQV�XQGHU

>KHU@�ZLQJV��DQG�\H�ZRXOG�QRW�

������%HKROG��\RXU��+RXVH��RI�-XGDK���LV�OHIW�XQWR�\RX

GHVRODWH�

������)RU�,�VD\�XQWR�\RX��<H�VKDOO�QRW�VHH�PH�KHQFHIRUWK�

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 72: Fagan Transcript

.LHOV�SLFWXUH

F\EHV�SLFWXUH

7KHWUXWKV�SLFWXUH

WLOO�\H�VKDOO�VD\��%OHVVHG�>LV@�KH�WKDW�FRPHWK�LQ�WKH�QDPH

RI�WKH�/RUG�

%HFDXVH�RI�WKH�FRUUXSWLRQ�RI�&KULVWV�WHDFKLQJV�E\�WKH

VR�FDOOHG�&KULVWLDQ�UHOLJLRQV ��WKLQJV�KDYH�QHYHU�FKDQJHG�

,W�ZDV�WKH�SUHGHFHVVRUV�RI�WKH�,OOXPLQDWL�LQ�WKH�6DQKHGULQ

WKDW�KDG�-HVXV�WKH�1D]DULWH��WKH�UHYROXWLRQDU\�� FUXFLILHG�

:KDW�KDYH�\RX�GRQH�DERXW�LW"�:KDW�GR�\RX�LQWHQG�WR�GR

DERXW�LW"�-$+

FHQWHU!

/RJLQ�RU�UHJLVWHU�WR�SRVW�FRPPHQWV � �������UHDGV

��FDWHJRULHV�� 1:2 � &RQWURO � 86$ � ,OOXPLQDWL � -HZU\���,VUDHO���=LRQLVP�����

&RPPHQW�YLHZLQJ�RSWLRQV

7KUHDGHG�OLVW���H[SDQGHG � 'DWH���ROGHVW�ILUVW

���FRPPHQWV�SHU�SDJH � 6DYH�VHWWLQJV

6HOHFW�\RXU�SUHIHUUHG�ZD\�WR�GLVSOD\�WKH�FRPPHQWV�DQGFOLFN��6DYH�VHWWLQJV��WR�DFWLYDWH�\RXU�FKDQJHV�

ZK\�ZHUH�SDUWV�FXW�RXW"

6XEPLWWHG�E\�.LHO��QRW�YHULILHG��RQ�-XO\�����������������

ZK\�GLG�\RX�FXW�WDON�RI�WKH�PRUPRQ�FKXUFK�QRW�EHORQJLQJ�WRWKH�QDWLRQDO�FRXQFLO�RI�FKXUFKHV"

/RJLQ�RU�UHJLVWHU�WR�SRVW�FRPPHQWV

2UJDQL]HG�UHOLJLRQV

6XEPLWWHG�E\�F\EH�RQ�-XO\�����������������

,W�LV�HGLWHG�RXW�EHFDXVH�$//�RUJDQL]HG�UHOLJLRQV�DUHZURQJ��DV�H[SODLQHG�LQ�WKH�ERRN� �7KH�:D\�KRPH�RU�IDFH7KH�)LUH��

/RJLQ�RU�UHJLVWHU�WR�SRVW�FRPPHQWV

:K\�GR�\RX�IHHO�LW�QHFHVVDU\

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 73: Fagan Transcript

5RGV�SLFWXUH

6XEPLWWHG�E\�7KHWUXWK�RQ�$XJXVW������������������

:K\�GR�\RX�IHHO�LW�QHFHVVDU\�WR�FHQVRU�0\URQ�)DJDQ"�:K\

LV�LW�WKDW�QHDUO\�HYHU\�VLQJOH�SURGXFWLRQ�RI�0\URQ�)DJDQV

OHJHQGDU\�DQG�YHU\�SDWULRWLF�VSHHFK�LV�(',7('��3RVW�WKH

)8//�7+,1*�RU�127+,1*�$7�$//��,WV�IUXVWUDWLQJ�WR�VHH

VXSSRVHG�SDWULRWV�ZKR�GR�WKH�VDPH�WKLQJ�WKDW�WKH

FRQVSLUDWRUV�GR��0DNHV�LW�KDUG�WR�GLVWLQJXLVK�ZKR�LV�ZKR��,

MXVW�VSHQW�WKH�SDVW����PLQXWHV�RQOLQH�VHDUFKLQJ�IRU�WKH

)8//�WUDQVFULSW�RI�0\URQ�)DJDQV�WDON��<RX�FDQ�ILQG�LW�DW

KWWS���ZZZ�PLQGFRQWUROIRUXPV�FRP�IDJDQ�KWP

'RQW�WUXVW�D�ZHEVLWH�WKDW�FHQVRUV�WKH�WUXWK���,W�LV�WKH�SORW

RI�6DWDQ�WR�JLYH�SDUWLDO�WUXWKV�

&KULVW�2UJDQL]HG�D�UHOLJLRQ��0RVHV�RUJDQL]HG�D�UHOLJLRQ�

*RG�RUJDQL]HG�WUXH�UHOLJLRQ��<RX�DUH�ZURQJ��\RX�DUH�DQ

HQHP\�WR�*RG��([DPLQH�\RXUVHOI�DQG�ILQG�RXW�ZKRV�VLGH

\RX�DUH�ILJKWLQJ�RQ�

/RJLQ�RU�UHJLVWHU�WR�SRVW�FRPPHQWV

5HDG��7KH�:D\�+RPH�RU�IDFH�WKH�)LUH�

6XEPLWWHG�E\�5RG�RQ�6HSWHPEHU�����������������

*RG�JDYH�XV�7KH�/DZV��0RVHV�DQG�&KULVW�WDXJKW�PDQ�WR

ORYH��KRQRU��DQG�REH\�*RG��5HDG��7KH�:D\�+RPH�RU�IDFH

7KH�)LUH���KXPEOH�\RXU��VHOI���DQG�OHDUQ�

/RJLQ�RU�UHJLVWHU�WR�SRVW�FRPPHQWV

+RPH

7KH�:D\�KRPH�RU�IDFH�7KH�)LUH���7KH�VXUYLYDO�SODQ�IRU�DOO�KXPDQ�EHLQJV

)$,5�86(�127,&(��7KLV�VLWH�FRQWDLQV�VRPH�FRS\ULJKWHG�PDWHULDO�WKH�XVH�RI�ZKLFK�KDV�QRW�DOZD\V�EHHQVSHFLILFDOO\�DXWKRUL]HG�E\�WKH�FRS\ULJKW�RZQHU��:H�DUH�PDNLQJ�VXFK�PDWHULDO�DYDLODEOH�LQ�RXU�HIIRUWV�WR�H[SRVHDQG�DGYDQFH�WKH�XQGHUVWDQGLQJ�RI�WKH�LVVXHV�FRYHUHG�KHUH��:H�EHOLHYH�WKLV�FRQVWLWXWHV�D�IDLU�XVH�RI�DQ\�VXFK

FRS\ULJKWHG�PDWHULDO�

7KH�21/<�VROXWLRQ�LV�WR�HQIRUFH�7KH�3ODQ�DJDLQVW�WKH�WUDLWRURXV�1��:��2��=LRQ�1D]L�PDVV�PXUGHU�

LQVLGH�MRE�SHUSHWUDWRUV�RI�2.&�������%DOL�����������DQG�WKH�SKRQH\�:DU�RQ�7HUURU�DQG�)UHHGRP�

DQG�UHLQVWDWH�*RGV�3HUIHFW�/DZV�RI�/LEHUW\�DQG�EULQJ�WKH�SHUSHWUDWRUV�WR�-XVWLFH�

7LPH�LV�UXQQLQJ�RXW

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30

Page 74: Fagan Transcript

.QXM2Q�FRP�LV�SURXG�WR�KHOS�LQGLYLGXDOV�ZLWK�WKHLU�MXQN�PDLO�SUREOHPV��6WRS�6SDP�+DUYHVWHUV��-RLQ�3URMHFW

+RQH\�3RW

�������FRP�LV�SRZHUHG�E\�$SDFKH��OLJKWWSG�DQG�'UXSDO��6SDP�SURWHFWLRQ�E\�KWWS�%O�DQG�0ROORP����>PRUH@

7KLV�VLWH�LV�DOVR�DYDLODEOH�DW�KWWS���YDKE�JUOSYS[UWJZ�RQLRQ��ZLWK�7RU�9DOLGDWH�;+70/�RU�&66�

7KH�,OOXPLQDWL�DQG�WKH�&RXQFLO�RQ�)RUHLJQ�5HODWLRQV�_��������FRP KWWS���ZZZ��������FRP�P\URQ

���RI��� ���������������30