The public fund shall adhere to the following procedures for companies on the scrutinized companies list:

(1)  Engagement:

(i)  The public fund shall immediately determine the companies on the scrutinized companies list in which the public fund owns direct or indirect holdings.

(ii)  For each company identified in paragraph (1)(i) with only inactive business operations, the public fund shall send a written notice informing the company of this chapter and encouraging it to continue to refrain from initiating active business operations in Iran until it is able to avoid scrutinized business operations. The public fund shall continue such correspondence on a semi-annual basis.

(iii)  For each company newly identified in paragraph (1)(i) with active business operations, the public fund shall send a written notice informing the company of its scrutinized company status and that it may become subject to divestment by the public fund. The notice shall offer the company the opportunity to clarify its Iran-related activities and shall encourage the company, within ninety (90) days, to either cease its scrutinized business operations or convert such operations to inactive business operations in order to avoid qualifying for divestment by the public fund.

(iv)  If, within ninety (90) days following the public fund’s first engagement with a company pursuant to paragraph (1)(iii), that company ceases scrutinized business operations, the company shall be removed from the scrutinized companies list and the provisions of this section shall cease to apply to it unless it resumes scrutinized business operations. If, within ninety (90) days following the public fund’s first engagement, the company converts its scrutinized active business operations to inactive business operations, the company shall be subject to all provisions relating thereto.

(2)  Divestment:

(i)  If, after ninety (90) days following the public fund’s first engagement with a company pursuant to paragraph (1)(iii) of this section, the company continues to have scrutinized active business operations, and only while such company continues to have scrutinized active business operations, the public fund shall sell, redeem, divest, or withdraw all publicly-traded securities of the company, except as provided below, according to the following schedule:

(A)  At least fifty percent (50%) of such assets shall be removed from the public fund’s assets under management by nine (9) months after the company’s most recent appearance on the scrutinized companies list.

(B)  One hundred percent (100%) of such assets shall be removed from the public fund’s assets under management within fifteen (15) months after the company’s most recent appearance on the scrutinized companies list.

(ii)  If a company that ceased scrutinized active business operations following engagement pursuant to paragraph (1)(iii) of this section resumes such operations, paragraph (2)(i) shall immediately apply, and the public fund shall send a written notice to the company. The company shall also be immediately reintroduced onto the scrutinized companies list.

(3)  Prohibition:

At no time shall the public fund acquire securities of companies on the scrutinized companies list that have active business operations, except as provided below.

(4)  Exemption:

No company which the United States government affirmatively declares to be excluded from its present or any future federal sanctions regime relating to Iran shall be subject to divestment or investment prohibition pursuant to subdivisions (2) and (3), nor any company which is primarily engaged in supplying goods or services intended to relieve human suffering in Iran or that is primarily engaged in promoting health, education, or journalistic, religious, or welfare activities in Iran.

(5)  Excluded Securities:

Notwithstanding anything herein to the contrary, subdivisions (2) and (3) shall not apply to indirect holdings in actively managed investment funds. The public fund shall, however, submit letters to the managers of such investment funds containing companies with scrutinized active business operations requesting that they consider removing such companies from the fund or create a similar actively managed fund with indirect holdings devoid of such companies. If the manager creates a similar fund, the public fund shall replace all applicable investments with investments in the similar fund in an expedited timeframe consistent with prudent investing standards. For the purposes of this section, “private equity” funds shall be deemed to be actively managed investment funds.