Subject: Notes from Call with Jonathan last night
From: "Michael Leonard" <[email-masked]>
To: "James Bulger" <[email-masked]>, "Hunter Biden" <[email-masked]>, "Devon Archer" <[email-masked]>
Date: Mon, 9 Mar 2015 09:34:05 -0400

All,

On the conference call last night I took notes about what I was hearing
Jonathan discuss. These are simply . my notes and there is nothing too
revealing in there especially now that Jonathan Li sent around his own
notes for the call. However, I wanted to circulate these around for each of
your own benefit.

Please let me know if you have any questions:
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The LP formally informed us that they would not invest on the day of
Chinese new year

Before that Jonathan believed that even though the LP was wavering they
would still come through

Chairman Zhou, Andy and Henry were all aware of these developments
throughout.

Jonathan says that between the time the deal was first announced and the
day Sinopec asked for the money the market has gotten less enthusiastic
about Sinopec.

The LP is a company owned by two private individuals. 100% private. The two
family members have made their money from the stock market. The senior one
started his career as an investor since the early 1990’s. Most of the
investments he has done are in the stock market. [I couldn’t hear the name
of the company]

Jonathan says they did due diligence on the LP’s financial strength. In
fact, they invested 2bn into the Alibaba IPO with Harvest.

Jonathan believes they have the money they just decided not to invest.

Fangda is our lawyer and has a large litigation department. They will be
the one going after the LP.

Jonathan believes it will be hard to go after the LP in any other
jurisdiction other than China. There is an arbitration clause in the
contract as well.

Jonathan is trying to figure out what fine Sinopec wants to charge. Sort
that out, then go try to sue the LP for that amount. That’s his current
strategy.

The maximum amount that Sinopec could get is 63mm RMB. Jonathan wants to
negotiate the amount down.

According to BHR’s lawyers whatever the damages we can then sue the LP for
those damages.

Sinopec didn’t announce our name in the publication but the insiders in
China know it was us. The internet scuttlebutt might get around but that
can’t be contained. To make an announcement will cause more attention to
it.

Jonathan thinks that SASAC and the ambassador don’t need to know… (I think-
hard to understand Jonathan on this because of background noise).

Jonathan is hoping the news doesn’t break. His message in the event that it
does break is that this happens a lot in China

The LP claims that they decided not to follow through because of news
reports of anti corruption about Sinopec.

The LP is a 100% investor on the nuclear deal

The LP even had a bank facility so that they would only have to put up
about 750mm RMB and the rest would be funded by leverage that was already
with a bank. Despite this they still refused to fund.

-- 
Michael R. Leonard
Vice President, Operations Department
Thornton Group LLC
14 Beacon Street, Suite 804A
Boston, MA 02108
Office: 617-248-9440
Mobile: 781-454-922