Subject: Fwd: Meeting with Henry and next steps
From: "Andrew Godfrey" <[email-masked]>
To: "Devon Archer" <[email-masked]>, "Hunter Biden" <[email-masked]>, "Eric Schwerin" <[email-masked]>
Date: Mon, 2 Nov 2015 12:57:09 -0500

Please see the below summary emails (chain) from our trip to Beijing. We are in the process of drafting our plan and will circulate a draft before the end of the day. 

The meetings were very encouraging and we aim to get a response out by end of day tomorrow.

Begin forwarded message:

> From: "Zellmer, Stefan" <[email-masked]>
> Date: November 2, 2015 at 12:42:22 PM EST
> To: Michael Leonard <[email-masked]>
> Cc: "Godfrey, Andrew" <[email-masked]>, James Bulger <[email-masked]>
> Subject: Re: Meeting with Henry and next steps
> 
> Hi Michael,
> 
> It was great to meet you and Jimmy, and thank you for your great help in Beijing.  Also thank you for the great summary here.  We will work this week on a follow up and share with you.  The proposal will have two parts, a business plan (I.e. How our businesses will work together in achieving Henry's goals) and a financial part, summarizing a path for acquiring ownership in Burnham.  
> 
> The detailed structural elements are tbd, but we do not see an issue in Harvest directly owning equity in Burnham Asset Management, which is a SEC registered investment advisor.  We also have an affiliation with a broker/dealer to accommodate commissions-based distribution  of our investment products.  This set-up is not uncommon and would be accessibly to Harvest.  
> 
> As part of the proposal we foresee a working group consisting of Harvest and Burnham leadership to define a more detailed path forward.
> 
> We met with Thomas and Ellen from Harvest Wealth Management, who presented a very impressive business plan.  No doubt will they a top player in the wealth management space in China.  They already have set up offshore investment capabilities and so far have added PIMCO, Permal and Sotheby's as managers.  We learned that a UCITS fund structure has a lot of advantages in accessing Chinese investment capital.
> 
> 
> On Nov 2, 2015, at 11:56 AM, Michael Leonard <[email-masked]> wrote:
> 
>> Andrew and Stefan,
>> 
>> I hope that the rest of your trip was productive and your trip back to the US was more or less hassle-free. I wanted to circulate an email regarding some of the key takeaways from our meeting with Henry per my notes for your reference.
>> 
>> At the end of our meeting at Harvest's office, Henry tasked the Burnham side with preparing a proposal about how Harvest and Burnham Asset Management would work together. Henry noted that such proposal should take into account two things:
>> Harvest has won a lawsuit with a distribution company that it was previously partnered with (I did not catch the name). Harvest now wholly owns such distribution company and Henry would like to know if there would be any regulatory or commercial implications in the event that Harvest becomes a shareholder of Burnham Asset Management; and
>> 
>> Harvest is potentially looking to take a significant stake (possibly 20%) in a publicly traded brokerage firm. Henry would like to know how this potential investment would relate to an investment in Burnham Asset Management.
>> It is also worth noting that Henry outlined explicitly why he wants to go to the US and we should bear his motives in mind as we craft our proposal to him. I noted that he gave four reasons for wanting to go to the US which are as follows:
>> Chinese investors want to be in the US with open architecture and good products. Chinese investors want to diversify their holdings as they are currently very China heavy. They put their desire for safe US assets ahead of their desire to generate large returns;
>>  
>> Henry wants a team in the US (and Europe) so that his teams can look at industry sectors with a global perspective and advise investors accordingly. In short, Henry wants to build up Harvest's research capability. Henry is very fond of research.
>> 
>> Henry want to serve US investors looking to invest in China. Not just in mutual funds but in all types of investments; and
>> 
>> Henry wants to improve his service quality. Henry believes that experience in the US- as it is a mature asset management market- will raise the standard for the service quality in China. This serves Henry's goal of continuing to build Harvest into a world-class asset management company.
>> Our next step is to craft a proposal for Henry on how the cooperation with Burnham will look bearing all of the above in mind. I think this will mostly come from your end but we obviously want to be helpful on that front. Let us know what we can do.
>> 
>> Also, I take it from the WeChat conversation that it seems you were able to meet with Henry's wealth management team on Friday in Beijing. I hope that was a valuable meeting. Any intelligence or developments from that meeting that Jim and I should be aware of?
>> 
>>=2