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(67A B730@3/97<5 @C:3 7A /@07B@/@G /<2 2=3A <=B >:/G / @=:3 7< /<G @3AC:BA
$9,(2(-, ( +/$&$,$/' )! .# /3 , "' $- -.,. "3 *,)5&
( -&,- 1# , ( " , $-.,$/.$)( !/(.$)(- -/# .#. !), ).# !), &')-. && !), ).# !), && !), ).# '31B7=< 4=1CA3A =< B63 0CG3@ 3?C7:70@7C; E63< @3A3@D3 >@713A /@3 H3@= '31B7=< B63< 53<3@/:7H3A
B67A @3AC:B B= /<G >/7@ =4 @3A3@D3 >@713A ! /<2 ! 37$0 $/3(*(!0(3+ 5'$, 0$1$04$ .0("$1 0$ 8$0-
+3 <3FB >@=D723 A=;3 <313AA/@G 1=<27B7=<A 4=@ 3?C7:70@7C; E63< 0=B6 @3A3@D3 >@713A /@3 3?C/: B= H3@= /<2
23@7D3 B63 C<7?C3 0CG3@ 3?C7:70@7C; 4=@ 53<3@71 >/@/;3B3@ D/:C3A 4=@ B67A 1/A3
$(2'$0 !37$0 5(** *$ 4$ 2'$ '(&'$04 *3$# &--# 3,"-,2$12$# 5(2' .0-! !(*(27 -,$ B 7A A=;3
E6/B 7<BC7B7D3 B= AC553AB B6/B <37B63@ >:/G3@ E7:: 03 E7::7<5 B= 57D3 C> =< B63 6756 D/:C32 5==2 4=@ 13@B/7<
=7<5 A= E=C:2 3AA3<B7/::G /::=E B63 =B63@ 0CG3@ B= 6/D3 7B 4=@ 4@33 E6716 E7:: @3AC:B 7< B63 7;;327/B3
7<13<B7D3 4=@ B63 I@AB >:/G3@ B= 23D7/B3 B= 07227<5 /< /@07B@/@7:G A;/:: /;=C<B 4=@ B63 6756 D/:C3 5==2 /<2
=0B/7<7<5 7B /4B3@ /:: $C@ I@AB 1:/7; 4=@;/::G AB/B3A B6/B AC16 /< 3?C7:70@7C; 2=3A <=B 3F7AB
* (+ # , $- () +/$&$,$/' $( 1#$# $.# , $ , $- )( ")) 1$.# *,)$&$.3 )( . ((). #)&
.#. !), $.# , -2' !37$01 5(** ,$4$0 !(# -, 2'$ 1 +$ &--# 5(2' .0-! !(*(27 -,$ +3 <3FB 6/D3 B63 4=::=E7<5
@3AC:B 4=@ E63< B63@3 7A =<:G =<3 /C1B7=< E7B6 BE= 07223@A
$++ /**)- ).# $ ,- , $$(" $( .# /.$)( !), ")) 1$.# *,)$&$.3 )( ( .#. $ $ # ( .# )(&3 +/$&$,$ , )( - $( 1#$# /3 , *& - *,)$&$.3 )( )( -)' $ $ ( /3 , *&3- '$2 $$(" -.,. "3 -.$-!3$(" $ $$ $
!), && /# +/$&$,$
, -/&. $( .# *3)7
! 1 '% .# !/,.# , , -.,$.$)( .#. /3 ,- '/-. *&3 )(&3
/()'$(. -.,. "$ - $. '/-. #)& .#. $ 31/CA3 B63@3 /@3 /A ;/<G 5==2A /D/7:/0:3 /A B63@3 /@3 07223@A <= 0CG3@ @3137D3A / H3@= 3F>31B32 >/G=P
7< /<G 0CG3@ 3?C7:70@7C; @=; :3;;/ 7B 7A 63<13 7;;327/B3 B6/B 0=B6 0CG3@A E7:: <=B 0=B6 072 =< 5==2
E7B6 >@=0/07:7BG =<3
* (+ # , $- () +/$&$,$/' $( 1#$# ).# /3 ,- $ )( ")) 1$.# *,)$&$.3 )( . ((). #)&
.#. - $/3(*(!0( &$,$0(" **7 5(2' !-2' !37$01 +(6(,& !$25$$, 3"2(-,1 =@ B63 @3AB =4 B67A A31B7=<
E3 E7:: 1=<A723@ 1/A3A 7< E6716 0=B6 0CG3@A >:/13 >=A7B7D3 >@=0/07:7BG =< 0=B6 /C1B7=<A +3 E7:: A6=E B6/B
<= AC16 1/A3 1/< 03 /< 3?C7:70@7C; 4=@ /<G 0CB / H3@= ;3/AC@3 AC0A3B =4 B63 >/@/;3B3@ A>/13
7@AB E3 E7:: A6=E B6/B 0=B6 0CG3@A ;CAB ;7F 7< B637@ 07227<5 AB@/B35G 7< / >/@B71C:/@ /C1B7=< /<2 B6/B
B63 ;7F7<5 27AB@70CB7=<A 4@=; E6716 B63G A3:31B B637@ 072A ;CAB 03 1=<B7<C=CA /B /:: >=A7B7D3 072A
$++ /**)- ).# /3 ,- *& *)-$.$0 *,)$&$.3 )( $$(" !), ")) 1$.# . & -. )( /3 ,
*&$(" & -- .#( *,)$&$.3 )( # ( $. '/-. .#. ( $.# , /3 , *&3- (3 *)-$.$0 $ 1$.# *)-$.$0
*,)$&$.3 #. $- .# , 2$-.- () # -/# .#. # !), $.# , $++ /**)- ).# /3 ,- *& *)-$.$0 *,)$&$.3 )( $$(" !), ")) 1$.# . & -. )( /3 ,
*&$(" & -- .#( *,)$&$.3 )( # ( $. '/-. #)& .#. .# -/**),.- , )(0 2 !), ).# #=E E3 E7:: A6=E B6/B /<2 ;CAB 6/D3 B63 A/;3 ;/F7;C; >=7=7<B =4
H3@=
$++ /**)- ).# /3 ,- *& *)-$.$0 *,)$&$.3 )( $$(" !), ")) 1$.# . & -. )( /3 ,
*&$(" & -- .#( *,)$&$.3 )( # ( $. '/-. #)& .#. $# '2$'/' *)--$& $ *& )( ")) 3
/3 , '/-. .# -' - .# '2$'/' *)--$& $ *& )( ")) 3 /3 , #. $- $$# '$($'/' *)--$& $ *& )( ")) '/-. 4 ,) !), ).# /3 ,- #. $- !), ).#
#3FB E3 E7:: A6=E B6/B E63< 0=B6 0CG3@A 6/D3 / >=A7B7D3 >@=0/07:7BG =4 >/@B717>/B7<5 7< /< /C1B7=@=0/07:7BG :3AA B6/< =<3 B63 >/G=P 4=@ / 0CG3@ 7< B6/B /C1B7=< 1/< 03 E@7BB3< /A B63
27P3@3<13 03BE33< 67A D/:C3 /<2 B63 ;/F7;C; >=AA70:3 072 0=B6 0CG3@A >:/13 =< B63 5==2
$++ /**)- ).# /3 ,- *& *)-$.$0 *,)$&$.3 )( $$(" !), ")) 1$.# . & -. )( /3 ,
*&$(" & -- .#( *,)$&$.3 )( # ( .# 2* . *3)7 !), /3 , !,)' .# /.$)( !), ")) $- .#
/3 ,6- 0&/ )! ")) '$(/- .# )'')( '2$'/' )! .# -/**),.- )! .# $-.,$/.$)(- !,)' 1#$# .#
/3 ,- #))- .# $, $- !), ")) #. $- $ +3 1/< <=E AB/B3 B6/B B63@3 7A <= 3?C7:70@7C; 7< E6716 0=B6 >:/G3@A ;7F 03BE33< B63 BE= /C1B7=<A
* (+ # , $- () +/$&$,$/' $( 1#$# ).# *&3 ,- '$2 .1 ( .# .1) /.$)(- ).# , .#( !), 4 ,)
' -/, )! .# *,' . , -* ( *,.$/&, -/# ( +/$&$,$/' )(&3 2$-.- 1# ( $ $ $ $ '33 (&30$ 4=@ / 5@/>671/: 23A1@7>B7=< =4 B63 @3AC:B AB/B32 7< :/7; '$ 3,(/3$ !37$0 $/3(*(!0(3+ (= AC;;/@7H3 E3 6/D3 A6=E< B6/B B63@3 /@3 <= 3?C7:70@7/ 7< E6716
37B63@ >:/G3@ 072A =< B63 :=E D/:C3 5==2 4=@ 13@B/7< <= 3?C7:70@7/ E6716 0=B6 >:/G3@A 072 7< B63 A/;3
/C1B7=< 4=@ 13@B/7< /<2 <= 3?C7:70@7/ 4=@ / 53<3@71 A3B =4 >/@/;3B3@A 7< E6716 0=B6 0CG3@A ;7F 03BE33<
0=B6 /C1B7=<A
(63 I@AB BE= @3AB@71B7=<A /@7A3 4@=; B63 7<13<B7D3 4=@ 0CG3@A B= 7<I<7B3A7;/::G =CB072 B637@ =>>=<3=AA707:7BG =4 0=B6 0CG3@A 037<5 3F/1B:G
7<27P3@3=AA707:7BG AB3;A 4@=; B63 0CG3@AJ 53<3@71/::G
Figure 1: Both buyers cannot be indiﬀerent between goods generically
v1H
v2H
= ΠH
1
=
bH
v2L
= ΠH
1
0
2
good H
v1L
bH
0
1
ΠH
2
= ΠH
2
bL
bL
0
0
1
2
good L
27P3@331B32 >/G=PA 4@=; / 57D3< /C1B7=< 1/< 03 >7<<32 2=E< 0G B637@ D/:C3A
< B67A A31B7=< E3 E7:: A6=E B6/B B67A 5/;3 6/A / C<7?C3 3?C7:70@7C; 4=@ / 53<3@71 A3B =4 >/@/;3B3@A (67A
3?C7:70@7C; E7:: 7<D=:D3 B63 =<:G >=AA70:3 1=;07</B7=< =4 /C1B7=< 16=713A E3 6/D3 <=B /:@3/2G @C:32 =CB =<3
7< E6716 =<3 0CG3@ ;7F3A 03BE33< B63 BE= /C1B7=<A /<2 B63 =B63@ 0CG3@ 072A =< B63 6756 D/:C3 5==2 E7B6
>@=0/07:7BG =<3 (63 0CG3@ E6= 072A =< B63 6756 D/:C3 5==2 4=@ 13@B/7< ;CAB 03 B63 =<3 E6= 6/A B63 67563@
K5/>L 03BE33< 67A BE= D/:C/B7=<A E67:3 B63 K:=E5/>L 0CG3@ E7:: ;7F 03BE33< /BB3;>B7<5 B= E7< B63 6756
D/:C3 5==2 B6@=C56 / ;7F32 07227<5 AB@/B35G /<2 A7;>:G B/97<5 B63 :=E D/:C3 5==2 0G 07227<5 H3@= /<2
=0B/7<7<5 67A 4C:: D/:C3 +7B6=CB :=AA =4 53<3@/:7BG E3 1/< /AAC;3 $ $ $ $ /<2 :3B 0CG3@ B/93
=< B63 @=:3 =4 B63 K67565/>L 0CG3@ (= 3AB/0:7A6 B63 C<7?C3 3?C7:70@7C; =4 B63 5/;3 E3 <332 =<3 ;=@3
:3;;/
$++ . ((). #)& $( (3 +/$&$,$/' .#. ).# *&3 ,- $ 4 ,) )( .# -' ")) # 1$.# *)-$.$0
*,)$&$.3 #. $- $. ((). #)& .#. ).# ( !), $.# , +3 1/< <=E 16/@/1B3@7H3 B63 C<7?C3 0CG3@ 3?C7:70@7C; 4=@ 53<3@71 >/@/;3B3@A '33 (&30$ 4=@ /
5@/>671/: 23A1@7>B7=< =4 B67A 0CG3@ 3?C7:70@7C;
'$-0$+ . $ $ $ $ # ( .# /($+/ +/$&$,$/' )! .# "' $- .# )( $( 1#$# /3 ,
$- )( .# #$"# 0&/ ")) 1$.# *,)$&$.3 )( /3 , '$2 - .1 ( $$(" $( .# /.$)(- &13$$(" 4 ,) )( .# &)1 0&/ ")) ( ).# /3 ,- '$2 $( .# $, $$(" !), .# #$"# 0&/ ")) $( -/#
13 .#. ).# , $($7 , (. .1 ( && $- $( .# -/**),. )! .# $, )1( $-.,$/.$)( ( $.# , #- $
)/.-$ #$- -/**),. 1#$# 3$ &- #$"# , *3)7 ( /3 , $- 2.&3 $($7 , (. .1 ( $$(" $( .#
.1) /.$)(- /# '$2$(" $(0)&0 - /3 , *&$(" *)-$.$0 *,)$&$.3 )( $$(" 4 ,) !), .# #$"# 0&/
")) ( *,.$/&, .#$- +/$&$,$/' $- "$0 ( 3
!), $ $ !), $ $ $ $
$
!), $ $ $ $ !), $ $ !), $ $ Figure 2: The unique generic buyer equilibrium
v1H
v2H
= Π1
= Π2
bH = v2H − v2L
bH
v2L
= Π2
mass
v2L
v2H
0
1
0
2
good H
mass 1
0
2
good L
37$0 /3(*(!0(3+ %-0 $,$0 * $1$04$ 0("$1
(63 @3AC:BA =4 B63 >@3D7=CA AC0A31B7=< /@3 2@7D3< 0G BE= 7;>:717B /AAC;>B7=<A 7@AB B63 BE= 0CG3@A /@3
/AAC;32 B= 0=B6 >@343@ B63 A/;3 5==2 5==2 A6=C:2 B63G 03 /::=E32 B= @3137D3 B637@ 5==2 =4 16=713
E7B6=CB 1=;>3B7B7=< 4@=; B63 =B63@ 0CG3@ '31=<2 @3A3@D3 >@713A /@3 :=E 3<=C56 B6/B <37B63@ 0CG3@ 7A
K>@7132 =CBL =4 07227<5 4=@ 37B63@ 5==2 (6/B 7A B63 @3A3@D3 >@713 4=@ 3/16 5==2 7A :=E3@ B6/< 0=B6 0CG3@AJ
D/:C/B7=<A 4=@ B6/B 5==2
< B67A AC0A31B7=< E3 E7:: 23@7D3 B63 0CG3@ 3?C7:70@7C; 4=@ /<G @3A3@D3 >@713A ! ! < 2=7<5
A= E3 E7:: 1=<A723@ @3A3@D3 >@713A 4=@ E6716 =<3 =@ 0=B6 =4 B63 7;>:717B /AAC;>B7=<A /0=D3 /@3 D7=:/B32
(63 I@AB /AAC;>B7=< E7:: 03 D7=:/B32 4=@ 0CG3@ E63<3D3@ ! ! $ $ #=B3 B6/B 4=@ AC16 @3A3@D3
>@713A 0CG3@ E=C:2 16==A3 B= >C@16/A3 5==2 4=@ >@713 ! @/B63@ B6/< 5==2 4=@ >@713 ! E63< 57D3<
B63 16=713 B= 16==A3 / 5==2 C<1=<B3AB32 0G B63 =B63@ 0CG3@ (63 A31=<2 /AAC;>B7=< E7:: 03 D7=:/B32 4=@ /
0CG3@ 07227<5 =< 5==2 E63<3D3@ ! $ 'C16 / 0CG3@ E7:: 03 >@7132 =CB =4 07227<5 4=@ 5==2 +3 I<2 B6/B B63@3 /@3 3756B A75<7I1/@713 A>/13 E63< /</:GH7<5 B63 0CG3@
3?C7:70@7/ /16 =4 B63A3 3756B @357=<A 6/A / ?C/:7B/B7D3:G 27P3@33 =4 0CG3@ 3?C7:70@7C; /AA=17/B32 E7B6
7B /<2 7B 6=:2A B6/B /:: @3A3@D3 >@713 >/7@A ! ! 6/D3 37B63@ / C<7?C3 0CG3@ 3?C7:70@7C; /AA=17/B32
E7B6 7B =@ 6/D3 ;C:B7>:3 3?C7:70@7/ E6716 /@3 /:: >/G=P 3?C7D/:3:3 0CG3@ 3?C7:70@7/
7< C<2=;7</B32 AB@/B3573A 0CB 7< B63A3 1/A3A /:: C<2=;7</B32 AB@/B35G 3?C7:70@7/ /@3 /5/7< >/G=P 3?C7D/:3/G=PA /@3 1=<B7<C=CA 7<
@3A3@D3 >@713A 3D3< /1@=AA B63 27P3@3A B= 7<B@=2C13 B63 4=::=E7<5 <=B/B7=< :3B $
/<2 $ :A= A33 (&30$1 ,# 4=@ / 5@/>671/: 7<B3@>@3B/B7=< =< B63A3 3756B
@357=<A
$&(-, (63 @357=< 7A 23I<32 0G
! ! ! ! $ $ ! $ $ $ $ (67A @357=< 1=<B/7<A B63 =@757< /<2 7A </;32 B= 23A1@703 B63 BG>3 =4 0CG3@ 3?C7:70@7C; E3 23@7D32 7< A31B7=<
(63 @357=< 7A B63 =<3 7< E6716 0=B6 0CG3@A >@343@ 5==2 B= 5==2 E63< C<1=<B3AB32 0CG3@ 7A <=B
>@7132 =CB =4 07227<5 4=@ 37B63@ 5==2 0CG3@ 7A <=B >@7132 =CB =4 07227<5 4=@ 5==2 /<2 0CG3@ 7A /0:3
B= ;/93 / ACO173<B:G 6756 >/G=P 07227<5 =< B6/B 63 7A E7::7<5 B= ;7F
(67A
:/AB 1=<27B7=< 7A D7=:/B32 E63< E6716 7A / 07<27<5 1=<AB@/7 v1H , v2L > v1L
rH − rL = v1H − v1L
rH − rL = v2H − v2L
both out
v2H
2→L
1 out
2 → L (wins)
1 → L (loses)
v1H
2→H
1 out
2→L
1 mixes
1→H
2→L
2 → H (wins)
1 → H (loses)
1→H
2 mixes
v1L
v2L − (v2H − v1H )
v2L
rL
r
Figure 3.2: v1H > v2H , v1L > v2L
H
rH − rL = v1H − v1L
rH − rL = v2H − v2L
1 → L (wins) 1 → L
v H 2 → L (loses) 2 out
both out
1
v1H − (v1L − v2L )
1→H
2 out
2→L
1 mixes
v2H
1→H
2→L
1 → H (wins)
2 → H (loses)
1→H
2 mixes
v2L
v1L
rL
r
H
Figure 3.3: v1H > v2H , v2L > v1L
rH − rL = v1H − v1L
rH − rL = v2H − v2L
2 → L (wins) 2 → L
1 → L (loses) 1 out
both out
v1H
1→H
2 out
L
v2H 21 →
mixes
1→H
2→L
1 → H (wins)
2 → H (loses)
1→H
2 mixes
v1L
v2L
rL
0-.-1(2(-, # /($+/ /3 , +/$&$,$/' !), (3 , - ,0 *,$ - ! ! $- "$0 ( 3
!), ! !), ! $ $ ! !), $ $ ! $ $ ! ! $ !
!), ! $ $ ! !), $ $ ! !), ! !), ! !), ! $ $ $ ! $ ! (63 >@==4 =4 %@=>=A7B7=< 7A =;7BB32 A7<13 7B 7A 723<B71/: B= B6/B =4 (63=@3; E7B6 B63 @3A3@D3 >@713A
! /<2 ! B@7D7/::G @3>:/17<5 H3@= 7< B63 1/:1C:/B7=<A
$&(-, (63 @357=< 7A 23I<32 0G
! ! ! ! $ $ ! $ $ $ $ (67A @357=< 7A B63 =<3 7< E6716 0=B6 0CG3@A >@343@ 5==2 B= 5==2 E63< C<1=<B3AB32 0CG3@ 7A <=B
>@7132 =CB =4 07227<5 4=@ 37B63@ 5==2 0CG3@ 7A <=B >@7132 =CB =4 07227<5 4=@ 5==2 /<2 0CG3@ 7A /0:3 B=
;/93 / ACO173<B:G 6756 >/G=P 07227<5 =< B6/B 63 7A E7::7<5 B= ;7F < 0CG3@ 3?C7:70@7/ /AA=17/B32 E7B6
B63A3 @3A3@D3 >@713A B63 @=:3A =4 5==2A /<2 /@3 @3D3@A32 4@=; B6=A3 7< @357=< /<2 63<13 B63
@=:3A =4 0CG3@A /<2 /@3 /:A= @3D3@A32 7< 0=B6 @357=<A 7B 7A B63 0CG3@ E7B6 B63 :=E3@ ;/@57</: D/:C/B7=<
4=@ B63 *, ! ,, 5==2 E6716 ;7F3A 03BE33< 5==2A E63@3 0G >@343@@32 5==2 E3 ;3/< B63 =<3 E6716 E=C:2
03 16=A3< 57D3< B63 @3A3@D3 >@713A 74 B63 =B63@ 0CG3@ 272 <=B 3F7AB (63 0CG3@ E7B6 B63 :=E3@ ;/@57</:
(67A :/AB 1=<27B7=< 7A D7=:/B32 E63< E6716 7A / 07<27<5 1=<AB@/7@343@@32 5==2 7< @357=< 7A 7<2332 0CG3@ E6=A3 ;/@57</: D/:C/B7=< 4=@ 5==2 1/< 03 E@7BB3< /A $ ! $ ! E6716 7A 7< 4/1B 5@3/B3@ B6/< H3@= 0CB :3AA B6/< $ ! $ ! B63 ;/@57</: D/:C/B7=< 4=@ 5==2 =4 0CG3@ (63 0CG3@ 3?C7:70@7/ 7< B67A @357=< <=B AC@>@7A7<5:G :==9A
3F/1B:G :793 B63 =<3A 7< @357=< E7B6 =<:G B63 </;3A =4 B63 5==2A /<2 0CG3@A @3D3@A32
0-.-1(2(-, # /($+/ /3 , +/$&$,$/' !), (3 , - ,0 *,$ - ! ! $- "$0 ( 3
$ $ $ !
$ !
!), ! !), ! !), ! !), ! $ $ ! !), $ $ ! !), ! !), ! $ $ ! !), $ $ ! $ ! $ $ $ ! (63 >@==4 =4 %@=>=A7B7=< 7A =;7BB32 A7<13 7B 7A 723<B71/: B= B6/B =4 (63=@3; E7B6 B63 @3A3@D3 >@713A
! /<2 ! B@7D7/::G @3>:/17<5 H3@= 7< B63 1/:1C:/B7=<A /<2 B63 </;3A =4 B63 5==2A /<2 0CG3@A @3D3@A32
$&(-, (63 @357=< 7A 23I<32 0G
! ! $ $ ! ! $ $ ! $ ! $ (67A @357=< 7A B63 =<3 7< E6716 E63< 3/16 0CG3@ 7A C<1=<B3AB32 0CG3@ >@343@A 5==2 E67:3 0CG3@ >@343@A 5==2 /<2 7< E6716 <37B63@ 0CG3@ 7A >@7132 =CB =4 07227<5 4=@ 67A >@343@@32 5==2 A =<3 E=C:2
3F>31B A7<13 B63 0CG3@A >@343@ 27P3@33@431B 1==@27</B7=< 7< B63 C<7?C3 0CG3@ 3?C7:70@7C;
/AA=17/B32 E7B6 3/16 >/7@ ! ! 7< B67A @357=<
0-.-1(2(-, # /($+/ /3 , +/$&$,$/' !), (3 , - ,0 *,$ - ! ! $- "$0 ( 3
!), ! !), ! !), ! !), ! $ ! $ ! $&(-, (63 @357=< 7A 23I<32 0G
! ! ! $ $ ! $ $ $ $ (67A @357=< 7A B63 =<3 7< E6716 0=B6 0CG3@A >@343@ 5==2 E63< C<1=<B3AB32 0CG3@ 7A 37B63@ >@7132 =CB
=4 07227<5 4=@ 5==2 =@ 1/<<=B =0B/7< / 6756 3<=C56 >/G=P 07227<5 =< 5==2 B= ;/93 ;7F7<5 03BE33<
/<2 E=@B6E67:3 /<2 <37B63@ 0CG3@ 7A >@7132 =CB =4 07227<5 =< 5==2 (63 0CG3@ E7B6 B63 67563@
D/:C/B7=< 4=@ 5==2 =0B/7<A 5==2 E67:3 B63 0CG3@ E7B6 B63 :=E3@ D/:C/B7=< 2=3A <=B =0B/7< 37B63@ 5==2
/<2 A3@D3A A=:3:G B= 27A17>:7<3 B63 >@713 =4 5==2 < C<2=;7</B32 AB@/B3573A B63 3?C7:70@7C; >@713 =4 5==2
7A <313AA/@7:G $ 0-.-1(2(-, (3 /3 , +/$&$,$/' $( /()'$(. -.,. "$ - !), (3 , - ,0 *,$ - ! ! '/-. -.$-!3
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=4 07227<5 4=@ 5==2 =@ 1/<<=B =0B/7< / 6756 3<=C56 >/G=P 07227<5 =< 5==2 B= ;/93 ;7F7<5 03BE33<
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/<2 A3@D3A A=:3:G B= 27A17>:7<3 B63 >@713 =4 5==2 < C<2=;7</B32 AB@/B3573A B63 3?C7:70@7C; >@713 =4 5==2
7A <313AA/@7:G $ 0-.-1(2(-, (3 /3 , +/$&$,$/' $( /()'$(. -.,. "$ - !), (3 , - ,0 *,$ - ! ! '/-. -.$-!3
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0CG3@A @3D3@A32
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=CB =4 07227<5 4=@ 5==2 E67:3 0CG3@ 7A >@7132 =CB =4 07227<5 4=@ 37B63@ 5==2 (@7D7/::G E3 53B
B63 @3AC:B B6/B 0CG3@ E7:: @3137D3 5==2 /<2 / >/G=P =4 $
! E67:3 0CG3@ E7:: <=B
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=CB =4 07227<5 4=@ 5==2 E67:3 0CG3@ 7A >@7132 =CB =4 07227<5 4=@ 37B63@ 5==2 (@7D7/::G E3 53B
B63 @3AC:B B6/B 0CG3@ E7:: @3137D3 5==2 /<2 / >/G=P =4 $
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$&(-, (63 @357=< 7A 23I<32 0G
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=<:G 0CG3@ 3?C7:70@7/ /@3 =<3A 7< E6716 <37B63@ 0CG3@ AC0;7BA /< /113>B/0:3 072
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<37B63@ >/@B717>/B3A 7< 37B63@ /C1B7=<
-3,# 0($1 !$25$$, 0$&(-,1
B 7A 7;>=@B//G=PA B= 0CG3@A /1@=AA
0=@23@7<5 @357=<A /@3 1=<B7<C=CA /<2 63<13 /<G @3A3@D3 >@713 >/7@ ! ! 03:=<57<5 B= ;C:B7>:3 @357=<A =4
7A /AA=17/B32 E7B6 3?C7:70@7/ 23A1@7032 7< # =4 B6=A3 @357=<A (67A 4/1B 1/< 03 A6=E< B6@=C56 A7;>:3
7<A>31B7=< =4 B63 >/G=PA /B B63 0=C<2/@73A 03BE33< 27P3@3:/G / @=:3 E63< E3
/</:GH3 B63 ;/@93B 3?C7:70@7C; 7< B63 <3FB A31B7=<
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1=;;7B B= @3A3@D3 >@713A ! /<2 ! 034=@3 B63 0CG3@ 5/;3 7A >:/G32 (= 2= A= E3 E7:: I@AB 1/:1C:/B3 A3::3@
>/G=PA @3AC:B7<5 4@=; B63 0CG3@ 3?C7:70@7/ 7< B63 3756B @357=<A /</:GH32 7< A31B7=< /<2 B63< 1/:1C:/B3
B63 3?C7:70@7C; =4 B63 5/;3 7< E6716 A3::3@A A7;C:B/<3=CA:G /<<=C<13 @3A3@D3 >@713A 034=@3 B63 0CG3@ 5/;3
7A >:/G32 +3 I<2 B6/B E63< A3::3@A 1/< 1=;;7B B= /<<=C<132 @3A3@D3 >@713A 7< B67A ;/<<3@ B63@3 7A /
C<7?C3 3?C7:70@7C; /::=1/B7=< /<2 C<7?C3 3?C7:70@7C; >/G=PA 0=B6 =4 E6716 /@3 3?C7D/:3:G >=AB >@713A
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@357=<A 03:=<57<5 B= B63 A3B (63
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07227<5 3/16 =B63@ 2=E< 7< A=;3 /@3/A =4 B63 @3A3@D3 >@713 A>/13 63<13 1@3/B7<5 / 3@B@/<2 >@717<5 3P31B
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16==A3 E6716 =<3 =4 BE= 27P3@3@713 /C1B7=<A +3 16/@/1B3@7H32 / C<7?C3 0CG3@ 3?C7:70@7C;
4=@ / 53<3@71 AC0A3B =4 B63 >/@/;3B3@ A>/13 E63< @3A3@D3 >@713A /@3 3F=53<=CA:G A3B B= H3@= (67A 3?C7:70@7C;
3F6707BA 1==@27</B7=< 4@71B7=<A /<2 @3AC:BA 7< / >=B3<B7/::G 7<3O173@713
(63 :=E3@ D/:C3 5==2 7A 37B63@ <=B A=:2 =@ A=:2 3F/1B:G /B B63 @3A3@D3 >@713 +3 B63< 16/@/1B3@7H32 0CG3@
3?C7:70@7/ 4=@ /:: @3A3@D3 >@713A <2=53<7H7<5 A3::3@ 036/D7=@ 0G /::=E7<5 A3::3@A B= /<<=C<13 /<2 1=;;7B B=
@3A3@D3 >@713A @3AC:B32 7< / C<7?C3 ;/@93B 3?C7:70@7C; =4 B63 5/;3 7< E6716 0CG3@A >3@431B:G 1==@27</B3 B63
3O173/G=PA /@3 3?C7D/:3@713>=AB7<5
1/A3
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9<=E7<5 B6/B A3::3@AJ KB@C3L @3A3@D3 >@713A =4 H3@= /@3 7< 3P31B 7A <=B/0:3 +3 1/< =0B/7< 4@=; B67A @3AC:B
/ 03BB3@ C<23@AB/<27<5 =4 B63 7;>=@B/<13 =4 E6716 A723 =4 / 2313<B@/:7H32 ;/@93B 7A 3P31B7D3:G @3A>=<A70:3
4=@ >@713 4=@;/B7=< E63< B63@3 7A BE=A7232 63B3@=53<37BG +63< B63 A/;3 A723 B6/B - ,# - 63@3 B63
0CG3@ A723 7A @3A>=<A70:3 4=@ >@713 4=@;/B7=< 1==@27</B7=< 4@71B7=<A /@3 AB7:: >@3A33B3 =D3@ B63 67563@ D/:C3 5==2 /<2 63<13 1=C:2 0=B6 072 =< 7B =E3D3@ E63< B63 *--$0
A723 =4 B63 ;/@93B 63@3 B63 A3::3@ A723 7A 7< 3P31B @3A>=<A70:3 63@3 0G A3BB7<5 $($(" @3A3@D3 >@713A B63
BE=A7232 63B3@=53<37BG @3AC:BA 7< >3@431B 1==@27</B7=< 0G B63 0CG3@A 7< 16==A7<5 B637@ 5==2A (63 0CG3@
E7B6 67563@ ;/@57</: D/:C/B7=< 4=@ B63 67563@ D/:C3 5==2 @3137D3A 7B /B @3A3@D3 >@713 E67:3 B63 =B63@ 0CG3@
@3137D3A B63 :=E D/:C3 5==2 /B 7BA @3A3@D3 >@713
(67A >/>3@ 7A >/@B =4 / :/@53@ @3A3/@16 /53<2/ @35/@27<5 A3::3@ 1=;>3B7B7=< 7< A7;C:B/<3=CA /C1B7=<A <
/ 1=;>/<7=< E=@97<5 >/>3@ '3:;/< /<2 #3;:7 E3 ABC2G B63 7<1=;>:3B3 7<4=@;/B7=< 4@/;3E=@9
E6716 7A ;=@3 1=;;=< 7< B63 /C1B7=< :7B3@/BC@3 /<2 A6=E B6/B @3D3<C3 3?C7D/:3<13 7A @=0CAB 7< / 53<3@/:
1=;>3B7<5 /C1B7=<A 4@/;3E=@9
..$,#(6
0--% -% * (+ 'C>>=A3 (63< 0CG3@ JA 03AB @3A>=<A3 7A B= >:/G B63 >C@3 AB@/B35G 07227<5 H3@= =< 5==2 53BB7<5 67A ;/F7;C; >=AA70:3 >/G=P =4 $ CG3@ JA @3AC:B7<5
>/G=P E=C:2 B63< 03 $ CB B63< 0CG3@ 1=C:2 23D7/B3 B= 072 =< 5==2 53BB7<5 / >/G=P =4
$ $ 4=@ ACO173<B:G A;/::
0--% -% $++ 'C>>=A3 I@AB B6/B $ $ (63< B67A 7A /< 3F/1B /</:=5 B= 3@B@/<2 1=;>3B7B7=<
03BE33< 723<B71/: I@;A 7< E6716 B63 =<:G 3?C7:70@7C; 7A B6/B 0=B6 0CG3@A I@;A 16==A3 B63 072 >@713
3?C/: B= B637@ D/:C3 1=AB E7B6 >@=0/07:7BG =<3 (67A 3?C7:70@7C; A/B7AI3A /:: =4 B63 1=<27B7=<A 23A1@7032 7<
B67A :3;;/
(63 @3AB =4 B63 >@==4 E7:: 1=<A723@ B63 1/A3 7< E6716 $ $ "2 B 1/<<=B 03 B6/B 6/A / 27A1=<B7<C7BG /B /<G 072 # $ C<:3AA 4=@ 37B63@ 0--% -% "2 'C>>=A3 6/A / 27A1=<B7<C7BG /B A=;3 # $ 4 # B63< 0CG3@ ;CAB <=B 03
/0:3 B= /1673D3 / 67563@ >/G=P B6/< 63 /1673D3A E7B6 # C<:3AA # 7A B63 =<:G >=7/G=P C3 B= 0CG3@ >:/G7<5 # E7B6 >=A7B7D3 >@=0/07:7BG 6=E3D3@ B63@3 7A /
>=A7B7D3 >@=0/07:7BG =4 / B73 /B # E63< 0CG3@ 072A # /<2 / >=A7B7D3 >@=0/07:7BG =4 0CG3@ :=A7<5 B= /
072 =4 # E63< 0CG3@ 072A A:756B:G 03:=E # '= 0CG3@ 1/< 072 A:756B:G /0=D3 # /<2 /1673D3 / 67563@
>/G=P B6/< 63 2=3A /B / >=A7B7D3 ;3/AC@3 =4 >=7<BA 7<1:C27<5 # /<2 B63 >=7<BA A:756B:G 03:=E 7B (63
7<I<7B3A7;/: 7<1@3/A3 7< 072 7A ;=@3 B6/< =PA3B 4=@ 0CG3@ 0G B63 27A1=<B7<C=CA 7<1@3/A3 7< E7<<7<5
>@=0/07:7BG '= 7B 1/<<=B 03 B6/B # 4 # 6=E3D3@ B63< 7B 7A AC0=>B7;/: 4=@ 0CG3@ B= 072
# C<:3AA # 0CB B63< A7<13 07227<5 A:756B:G :3AA 2=3A <=B 231@3/A3 67A >@=0/07:7BG
=4 E7<<7<5 A7<13 0CG3@ 7A <=B 07227<5 7< B63 <37560=@6==2 8CAB 03:=E # (63 A/;3 :=571 />>:73A 4=@
27A1=<B7<C7B73A 7< "2 4 0=B6 /<2 /@3 1=<B7<C=CA B63< 7B ;CAB 6=:2 B6/B B63 AC>>=@BA /@3 1=<D3F 4=@ 0=B6
0--% -% "2 'C>>=A3 7A <=B 1=<D3F (6/B 7A AC>>=A3 7A 1=<AB/>=@B 4 $ B63< 0CG3@ 7A AB@71B:G 03BB3@ =P 07227<5 B6/< 07227<5 /<G
D/:C3 =< B63 7<B3@D/: A7<13 67A >@=0/07:7BG =4 E7<<7<5 5==2 7A 1=<AB/:73A B6/B 7A /:A= 1=<AB/B7;/: 4=@ 0CG3@ B= 6/D3 /<2 B63 <37560=@6==2 8CAB /0=D3 7< 4 $ B63< 7B ;CAB 03 B6/B A7<13
/<G 072A 7< B63 7<B3@D/: E=C:2 B63< G73:2 / <35/B7D3 3F>31B32 >/G=P B 7A B63< AC0=>B7;/: 4=@
0CG3@ B= 072 /<G A7<13 072A 7< B63 7<B3@D/: /:A= G73:2 >@=0/07:7BG =<3 =4 E7<<7<5 5==2
0CB /B / :=E3@ 1=AB (63 A/;3 :=571 />>:73A 74 E3 AC>>=A3 B6/B 7A <=B 1=<D3F
"2 B ;CAB 6=:2 B6/B 0--% -% "2 4 B63< 0CG3@ E7<A B63 /C1B7=< 4=@ /:: 072A 7< B63 7<B3@D/: /<2 63<13 /::
072A 7< B67A 7<B3@D/: /@3 AC0=>B7;/: A7<13 63 1/< /:E/GA 072 A:756B:G :=E3@ /<2 AB7:: E7< E7B6 >@=0/07:7BG
=<3 (63 A/;3 :=571 />>:73A 4=@ 0CG3@ 74 "2 =B6 /<2 /@3 1=<B7<C=CA 74 /<2 =<:G 74 0--% -% "2 'C>>=A3 B6/B 0=B6 /<2 /@3 1=<B7<C=CA @=; 4/1B E3 6/D3 B6/B /<2 /@3
0=B6 1=<D3F A= 7;>:73A B6/B 37B63@ =@ :A= E3 1/< 3AB/0:7A6 B6/B
$ 4 $ B63< 0CG3@ E=C:2 6/D3 072A 7< 67A AC>>=@B /B E6716 63 6/A / >=A7B7D3 >@=0/07:7BG
=4 E7<<7<5 /<2 @3137D7<5 / <35/B7D3 >/G=P E6716 7A <=B >=AA70:3 7< 3?C7:70@7C; C<:3AA 7B E3@3 B63 1/A3
B6/B E6716 7A /:A= 7;>=AA70:3 A7<13 E3 9<=E 7A 1=<B7<C=CA /<2 G3B /:: 072A AB@71B:G
/0=D3 E=C:2 G73:2 0CG3@ / AB@71B:G :=E3@ >/G=P B6/>=A3 B6/B CB 74 B63< A7<13 4=@ /::
/<2 A=;3 AC16 072A /@3 7< 7B 1/<<=B 6=:2 B6/B 0CG3@ 7A 7<27P3@3>=@B A7<13 4=@ /<G 072 (63 A/;3 :=571 />>:73A 4=@ 74 #=E AC>>=A3 B6/B /<2 B6/B 37B63@ =@ 6/A / 27A1=<B7<C7BG 31/CA3 0=B6 0CG3@A 6/D3 / >=A7B7D3 >@=0/07:7BG
=4 E7<<7<5 B63 /C1B7==A7B7D3 >/G=P C<:3AA $ E6716 7A 7;>=AA70:3 A7<13 0CG3@ E=C:2 23D7/B3 B= 072 A:756B:G
;=@3 /<2 E7< 4=@ AC@3 /1B B63< B3::A CA B6/B 1/<<=B 6/D3 / 27A1=<B7<C7BG /B /<G 072 # $ 4=@ 37B63@ 'C>>=A3 B63 27A1=<B7<C7BG 7A /B A=;3 $ (63< @35/@2:3AA =4 E63B63@ B63
27A1=<B7<C7BG 7A 7< =@ 0CG3@ ;CAB 03 53BB7<5 / <35/B7D3 >/G=P 4=@ A=;3 $&
'
E6716 1/<<=B =11C@ 7< 3?C7:70@7C; CB / 27A1=<B7<C7BG /B $ 7;>:73A B6/B 37B63@ $ E6716 7A
7;>=AA70:3 /A AB/B32 /0=D3 =@ B6/B 0CG3@ 7A 53BB7<5 / :7;7B >/G=P =4 $ E63< 07227<5 1:=A3 B= $ 0CB $ 4=@ $ E6716 D7=:/B3A 67A 7<27P3@3<13
1=<27B7=< 03BE33< /:;=AB /:: 072A "2 (63@3 /@3 <= 3?C7:70@7/ 7< E6716 0=B6 /<2 /@3 1=<B7<C=CA /<2 63<13 0G 1=@=::/@G <=
3?C7:70@7/ 7< E6716 0--% -% "2 )A7<5 4/1BA /<2 E3 1/< CA3 / :7;7B B= /@5C;3<B B= AB/B3 B6/B
$ * )( +
/A E6716 1/<<=B 6=:2 7< 3?C7:70@7C; A7<13 E3 9<=E B6/B 4=@ /<G 072 /1B B63<
57D3A CA B6/B 27A1=<B7<C7B73A 1/< =<:G /@7A3 /B =@ /0=D3 $ +3 <=E 6/D3 B6/B /B :3/AB =<3 =4 /<2 6/D3 / 27A1=<B7<C7BG /<2 B6/B B67A
27A1=<B7<C7BG ;CAB 03 /B A=;3 $ C<:3AA B63 0CG3@ E7B6 B63 27A1=<B7<C7BG 7< 67A 27AB@70CB7=< 53BA /
>/G=P =4 H3@= #3FB E3 E7:: A6=E B6/B B63 =<:G =D3@:/> 03BE33< B63 BE= AC>>=@BA 7< 3?C7:70@7C; 1/< 03 /B
B63 ;/F7;C;
& '
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