From: David Stern <EIMINI=> To: Jeffrey Epstein <[email protected]> Subject: DRAFT Merkin Date: Tue, 21 Jan 2014 19:48:48 +0000 Attachments: Dec 19thstft Nov_14thstfd.zip; July_26th.rtfd.zip; July_23rd.rtf Erez, You called me this morning and informed me that the closing the of transaction as agreed between Dr Merkin and me on July 19 can not proceed because the government contract that was signed in December had only a value RMB 1 million, and Heritage was only informed about this contract amount (that you called "insignificant" sometime in December. This is a misunderstanding on your side and here are the facts: I. The key terms of this contract were discussed and agreed during the meeting with Dr Merkin and Adam Goldston on July 19. I pointed out that RMB 1 million is the cut off for tendering requirements under Chinese law and explained this contract signed with a central Ministry body is a significant milestone for the business. 2. Due the significance of these terms Adam Goldston on behalf of Heritage asked for exact wording for the term sheet. This was provided on July 23 in writing (email attached). I quote this email: "A signed agreement between Asia Gateway Healthcare Information Technology and any governmental party under the jurisdiction of the Ministry of Human Resources and Social Security of the P. R. China, having a value of no less than RMB I million, for use of the Asia Gateway Healthcare Insurance Information Processing And Analytics System." 3. From the first Term Sheet draft sent by Adam Goldston/Heritage to me dated on July 26, the term sheet always referred to the above quoted clause which clearly stated the amount of RMB 1 million. Email and Term Sheet attached. 4. Since the first draft of the Stock Purchase Agreement until the final Heritage agreed Stock Purchase Agreement clause 6.02 c) states: "the Company or Asia Gateway shall have entered into a contract with a division of the Ministry on terms and condition