Risk Factors.
−Removed: Except for the risk factors disclosed below, there were no material changes to our risk factors during the three months ended March 31, 2020 as compared to those reported in our Annual Report on Form 10-K for the year ended December 31, 2019.
+Added: Except for the risk factors disclosed below, there were no material changes to our risk factors during the six months ended June 30, 2020 as compared to those reported in our Annual Report on Form 10-K for the year ended December 31, 2019.
The COVID-19 pandemic may have a material adverse impact on our and our subsidiaries’ operations and financial performance, as well as on the operations and financial performance of many of the customers and suppliers in our operating segments.
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As a result, the Investment Funds’ investment portfolio’s aggregate returns may be volatile and may be affected substantially by the performance of only one or a few holdings.
−Removed: As of March 31, 2020, our top five holdings in the Investment Funds had a market value of approximately $5.1 billion, which represented approximately 55% of our assets under management for the Investment Segment.
−Removed: Our largest holding at March 31, 2020 was Caesars Entertainment Corporation, which had a market value of approximately $1.3 billion, and represented approximately 14% of our assets under management for the Investment Segment.
+Added: As of June 30, 2020, our top five holdings in the Investment Funds had a market value of approximately $7.2 billion, which represented approximately 72% of our assets under management for the Investment Segment.
+Added: Our largest holding at June 30, 2020 was Caesars Entertainment Corporation, which had a market value of approximately $2.3 billion, and represented approximately 23% of our assets under management for the Investment Segment.
We also had holdings in Herbalife Ltd.
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For example, Herbalife previously disclosed in its public filings that the SEC and the Department of Justice (the “DOJ”) have been conducting investigations into Herbalife’s compliance with the Foreign Corrupt Practices Act in China, which are mainly focused on Herbalife’s China external affairs expenditures, its China business activities, the adequacy of and compliance with Herbalife’s internal controls in China, and the accuracy of Herbalife’s books and records relating to its China operations.
−Removed: Herbalife is continuing to cooperate with the SEC and DOJ and is continuing to discuss with them possible resolution, including settlement, of these matters.
−Removed: As a result of these discussions, Herbalife has reached an understanding in principle with respect to the material terms of settlement with each of the SEC staff and DOJ relating to alleged activities that took place in 2006 through 2016.
+Added: Herbalife is continuing to cooperate with the SEC and DOJ and is continuing to discuss with them possible settlement of these matters.
+Added: As a result of these discussions, Herbalife has reached an understanding in principle with respect to the material terms of settlement and resolution documentation with each of the SEC staff and DOJ relating to alleged activities that took place in 2006 through 2016.
Based on these understandings, Herbalife would enter into an administrative resolution with the SEC with respect to alleged violations of the books and records and internal controls provisions of the FCPA and would separately enter into a deferred prosecution agreement with the DOJ, under which the DOJ would defer criminal prosecution of Herbalife for a period of three years related to a conspiracy to violate the books and records provisions of the FCPA.
In addition, Herbalife would agree to pay the SEC and DOJ aggregate penalties, disgorgement and prejudgment interest of approximately $123 million.
−Removed: While Herbalife believes that, based on the foregoing terms, it is nearing resolution of these matters, there can be no assurance as to the timing or the ultimate terms of any final settlements, including the principle terms discussed above, or that final resolutions will be reached at all.
−Removed: In the event settlements are not reached, litigation may ensue and, accordingly, the actual loss incurred in connection with these matters, if any, could be less than, equal to or exceed the aggregate amount noted above, and such actual loss amount could be materially adverse to Herbalife, its financial condition, results of operations, and operations and the trading price of its common shares, which could, in turn, have a material adverse impact on our consolidated financial position, results of operations or cash flows and the trading price of our depositary units.
+Added: While Herbalife believes that, based on the foregoing terms, it is nearing final resolution of these matters, there can be no assurance as to the timing or the ultimate terms of any final settlements, including the principle terms discussed above, or that final resolutions and approvals will be reached and obtained.
+Added: In the event settlements and final approvals are not reached and obtained, litigation may ensue and, accordingly, the actual loss incurred in connection with these matters, if any, could be less than, equal to or exceed the aggregate amount noted above, and such actual loss amount could be materially adverse to Herbalife, its financial condition, results of operations, and operations and the trading price of its common shares, which could, in turn, have a material adverse impact on our consolidated financial position, results of operations or cash flows and the trading price of our depositary units.
At the present time, Herbalife is unable to reasonably estimate nor provide any assurance regarding the amount of any potential loss in excess of the aggregate amount of approximately $123 million stated above relating to these matters.
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Chief Accounting Officer
+Added: August 10, 2020
Icahn Enterprises Holdings L.P.
9 unchanged sentences
Chief Accounting Officer
+Added: August 10, 2020
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.