Guo Wengui / Miles Guo — bankruptcy case · EXHIBIT · ECF #1380-1

## **EXHIBIT A**

771 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 UNITED STATES BANKRUPTCY COURT DISTRICT OF CONNECTICUT BRIDGEPORT DIVISION . IN RE: . Chapter 11 . HO WAN KWOK, . CASE NO.: 22-50073 (JAM) . Debtors. . . . . . . . . . . . . . . . . . . PACIFIC ALLIANCE ASIA . OPPORTUNITY FUND L.P., . Adv. Pro. No.: 22-05032 . Plaintiff, . v. . . HO WAN KWOK, . . Bridgeport, Connecticut Defendants. . December 12, 2022 . . . . . . . . . . . . . . . . . TRANSCRIPT OF MONTION FOR PRELIMINARY INJUNCTION **BEFORE THE HONORABLE JULIE A. MANNING UNITED STATES BANKRUPTCY JUDGE (DAY 4)** APPEARANCES: For the Plaintiffs: PETER FRIEDMAN, ESQ. DAVID HARBACH, ESQ. STUART SARNOFF, ESQ. DANIEL CANTOR, ESQ. O'Melveny & Myers, LLP Times Square Tower 7 Times Square New York, New York 10036 Transcription Company: Reliable 1007 N. Orange Street Wilmington, Delaware 19801 (302)654-8080 Email: gmatthews@reliable-co.com Proceedings recorded by electronic sound recording, transcript produced by transcription service. Case 22-50073 Doc 1380-1 Filed 01/24/23 Entered 01/24/23 17:27:08 Page 2 of 11

| | Case 22-50073<br>Doc 1380-1<br>Filed 01/24/23<br>Entered 01/24/23 17:27:08<br>Page 3 of | | | |----|-----------------------------------------------------------------------------------------|--|--| | | 11<br>841 | | | | | | | | | 1 | A.<br>Yes, I am. | | | | 2 | Q.<br>And you're an attorney, obviously.<br>What's your | | | | 3 | specialty? | | | | 4 | A.<br>Commercial litigation and bankruptcy -- commercial | | | | 5 | bankruptcy. | | | | 6 | Q.<br>And how long have you been practicing in that | | | | 7 | area? | | | | 8 | A.<br>Twenty-eight years. | | | | 9 | Q.<br>And you're affiliated with a firm? | | | | 10 | A.<br>Yes, I am. | | | | 11 | Q.<br>Which firm is that? | | | | 12 | A.<br>Zeisler & Zeisler. | | | | 13 | Q.<br>And do you have a position with that firm? | | | | 14 | A.<br>I am a shareholder and managing partner. | | | | 15 | Q.<br>And Mr. Kindseth, were you present at a meeting | | | | 16 | between the Debtor and the Trustee on November 17th, 2022? | | | | 17 | A.<br>Yes, I was. | | | | 18 | Q.<br>How did it come about that you had this meeting | | | | 19 | with the Trustee? | | | | 20 | A.<br>The Trustee called my partner, Eric Henzy, and | | | | 21 | requested a face-to-face meeting on November 16th in the | | | | 22 | afternoon, and ultimately, we agreed to meet with the | | | | 23 | Trustee. | | | | 24 | Q.<br>And what was your response to the proposal to have | | | | 25 | a meeting with the Trustee? | | | | | | | |

## Case 22-50073 Doc 1380-1 Filed 01/24/23 Entered 01/24/23 17:27:08 Page 4 of

11

844

1 2 3 Q. And can you describe for the Court, without getting into specific terms, the process that had unfolded in trying to achieve a global settlement?

4 5 6 7 8 9 10 11 A. Yes, so I originally represented Ms. Mao Gou (phonetic) is HKUSA, and through that had developed a -- what I thought as a very good working relationship with PAX's counsel, Attorney Friedman and Attorney Sarnoff. And then, when I got retained to represent Mr. Kwok in the bankruptcy case, we started having discussions about an global settlement. And so, this would be July and August, and they continued primarily between me and Attorney Sarnoff.

12 13 14 15 16 17 18 19 We made significant progress in August, to the point where I requested that they summarize what their demands were, which was provided to me in early September. We negotiated through September and then reached the point on those terms where we felt we -- actually, there was a term sheet on September 23rd, and then we turned our attention to the creditor's committee -- counsel and the creditor's committee.

20 21 22 23 24 25 We negotiated with them through October, to the point where on October 26th, we articulated to the trustee that we had reached an agreement on all material terms. And we had been informing the t=Trustee of the progress that we were making, and asking him repeatedly to stand down, and he refused. We asked him to articulate what additional

1 2 3 concessions he wanted, in addition to everything we had given to PAX and the creditors' committee. And he provided what - that to us on October 30th.

4 5 6 Q. And was there anything else about the negotiations with the trustee, in terms of how they proceeded prior to the meeting?

7 8 9 10 11 12 13 14 15 16 A. So the Trustee had unique -- you know, distinct issues to the -- to the Trustee's place in this case. And the Trustee's focus really was on trying to secure performance of the agreements that had been reached. And the Trustee also had a significant issue with the H-coin potential claims. And you know, we disputed that there was any validity to these claims, and the Trustee raised an issue with how those would be addressed in the case. And so, that is really what the focus was on in November, trying to deal with this possibility.

17 18 Q. And did any other issues arise in the settlement discussions?

19 20 21 22 23 A. PAX, in November, raised the desire to have further security through a line of credit or some other collateral, posting of cash. And we went back and forth, but by November 16th I believe we had given PAX everything it wanted.

24 25 Q. And -- so where were the settlement discussions by the time the Trustee had requested this meeting? The

848 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 MR. FRIEDMAN: Thank you, Your Honor. THE COURT: Overrule your objection. Continue, counsel. BY MR. WACHEN: Q. So -- THE COURT: I don't know if there -- I think you answered that question? MR. WACHEN: Did -- THE WITNESS: Thank you. MR. WACHEN: -- did you finish your answer? THE COURT: Yeah, I think that -- that answer, you're done, you should ask another question. MR. WACHEN: Okay. Yeah. Thank you, Your Honor. BY MR. WACHEN: Q. And what was your response to having received that email with a proposed agreement? A. We decided to -- that we were -- we were sitting and listening. And if -- you know, and we would comply with the agreement, and we were going to sit and listen, even though there were numerous red flags. Q. And the meeting was on the 17th of November, right? A. Correct, November 17th. Q. And who was at the meeting? A. So the was me, Aaron Mitchell, Nicholas Bassett, Case 22-50073 Doc 1380-1 Filed 01/24/23 Entered 01/24/23 17:27:08 Page 6 of 11

864 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 THE COURT: You talk -- I understand the question about Al Capone, that's fine. Okay? And I understand about the -- talking about the IRS and SEC, you know, that Mr. Despins testified about that. MR. WACHEN: Right. THE COURT: But we're not talking about who is keeping what and what the terms of the settlement are. And I don't want to -- I can't be more clear than that. MR. WACHEN: Okay. THE COURT: Okay? MR. WACHEN: Okay. THE COURT: So we need to be -- you can ask him anything you want to ask him about what Mr. Despins said. But if we start talking about who's keep what and getting this and getting that, that's not relevant, and it's not admissible. And this is not what the preliminary injunction is about. Okay? MR. WACHEN: Understood -- THE COURT: So -- MR. WACHEN: -- Your Honor. THE COURT: -- go ahead. MR. WACHEN: Okay. BY MR. WACHEN: Q. So you testified that Mr. Despins said pay me \$250 million dollars? Case 22-50073 Doc 1380-1 Filed 01/24/23 Entered 01/24/23 17:27:08 Page 7 of 11

865 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 A. Yes. Q. And what was your understanding of that? A. My understanding -- I mean, I assumed he meant as Trustee for the estate. Q. And so, this was -- was this a part of his proposal, pay me \$250 million? MR. BASSETT: Objection. THE COURT: Hey, we don't want a proposal, counsel, again, right? Mr. Despins talked about the \$250 million, right? MR. WACHEN: Right. THE COURT: So did Mr. Kwok. That's fine. Just talk about the \$250 million. It's not -- we're not talking about it in terms of a proposal. MR. WACHEN: Okay. THE COURT: You asked a question, which I think was a valid question given what's occurred in this -- these hearing already, that -- to Mr. Kindseth, did Mr. Despins say pay me \$250 million? Mr. Kindseth said yes, you asked him what did that mean, Mr. Kindseth said, I believe he meant as the Trustee. So now, let's go on -- MR. WACHEN: Okay. THE COURT: -- okay? MR. WACHEN: Thank you. BY MR. WACHEN: Case 22-50073 Doc 1380-1 Filed 01/24/23 Entered 01/24/23 17:27:08 Page 8 of 11

866 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Q. And what was -- what was your reaction to his request to pay him \$250 million? Without -- without going into the terms of a proposal? A. Livid. I was very upset, distraught. Q. And why was that? A. It deviated greatly from what was -- what I believed a global settlement that was nearly imminent the day before. Q. And do you know how Mr. Kwok perceived that statement by Mr. Despins, pay me \$250 million? MR. BASSETT: Objection. Calls for speculation. Calls for hearsay. THE COURT: Sustained. BY MR. WACHEN: Q. At some point, did you respond to Mr. Despins in his -- in his statement, pay me \$250 million? A. Yes, I did. There was two phases. There was one in the presence of everyone, and then there was a separate, where I came back into the conference room, after showing my client, and the translator, and Attorney Mitchell out and had a response. So -- Q. Let's take them one at a time. A. Okay. Q. So what did you say in the room when everybody was there? Case 22-50073 Doc 1380-1 Filed 01/24/23 Entered 01/24/23 17:27:08 Page 9 of 11

895

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 remotely doing his or her job would make it his or her number one priority to investigate the entities who have connections with the Debtor, his relatives and other individuals to determine whether it is in fact true that this Debtor, who has in the past, professed to have the life of billionaire, only has a few thousand dollars to his name. A. Not when all known creditors have agreed to a global settlement. Q. Well, there wasn't a global settlement, was there? A. Because the Trustee was in the way of that. And then he torpedoed it. Q. Well, isn't the reason that there was no global settlement ultimately because this Debtor could not come up with security for the amount that he had agreed to pay? A. That's not true. We offered -- we offered security that was asked. It was on the table. That's why I wrote the letter. Q. So he had -- A. Because we had offered a cash deposit in escrow which satisfied PAX. We were done. And still there was no settlement. Q. Had you offered to secure the entirety of the payment -- the entire payment was supposed to be in escrow? A. To PAX, yes. To PAX, yes. Q. Okay. But that wasn't the entirety of the

| | Case 22-50073<br>Doc 1380-1<br>Filed 01/24/23 | Entered 01/24/23 17:27:08 | Page 11 of | | |----|------------------------------------------------------------|---------------------------|-------------------|--| | | 11 | | 1013 | | | 1 | CERTIFICATION | | | | | 2 | | | | | | 3 | We certify that the foregoing is a correct transcript from | | | | | 4 | the electronic sound recording of the proceedings in the | | | | | 5 | above-entitled matter to the best of our knowledge and | | | | | 6 | ability. | | | | | 7 | | | | | | 8 | /s/ Mary Zajaczkowski | | December 14, 2022 | | | 9 | Mary Zajaczkowski, CET-531 | | | | | 10 | Certified Court Transcriptionist | | | | | 11 | For Reliable | | | | | 12 | | | | | | 13 | /s/ WENDY SAWYER | | December 14, 2022 | | | 14 | WENDY SAWYER, CDLT | | | | | 15 | | | | | | 16 | | | | | | 17 | | | | | | 18 | | | | | | 19 | | | | | | 20 | | | | | | 21 | | | | | | 22 | | | | | | 23 | | | | | | 24 | | | | | | 25 | | | | | | | | | | | | | | | | | | | | | | |