SEC Form 4
FORM 4 UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934
or Section 30(h) of the Investment Company Act of 1940
OMB APPROVAL
OMB Number: 3235-0287
Expires: December 31, 2014
Estimated average burden
hours per response: 0.5
  
Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).
1. Name and Address of Reporting Person*
LIU ZHENYONG

(Last) (First) (Middle)
C/O ORIENT PAPER, INC.
SCIENCE PARK, JULI ROAD

(Street)
BAODING CITY,HEBEI PROVINCE F4 072550

(City) (State) (Zip)
2. Issuer Name and Ticker or Trading Symbol
Orient Paper Inc. [ ONP ]
5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)
X Director X 10% Owner
X Officer (give title below) Other (specify below)
Chief Executive Officer
3. Date of Earliest Transaction (Month/Day/Year)
09/20/2011
4. If Amendment, Date of Original Filed (Month/Day/Year)
6. Individual or Joint/Group Filing (Check Applicable Line)
X Form filed by One Reporting Person
Form filed by More than One Reporting Person
Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3) 2. Transaction Date (Month/Day/Year) 2A. Deemed Execution Date, if any (Month/Day/Year) 3. Transaction Code (Instr. 8) 4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5) 5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4) 6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4) 7. Nature of Indirect Beneficial Ownership (Instr. 4)
Code V Amount (A) or (D) Price
Common Stock (1) 08/31/2009 J 1,204,341 (1) A $0.8303 (1) 5,115,852 (1) D
Common Stock (2) (3) 06/30/2011 J 51,011 D $0 5,064,841 D
Common Stock (4) 09/19/2011 P 20,000 A $2.8116 5,084,841 D
Common Stock (5) 09/20/2011 P 15,000 A $2.9499 5,099,841 D
Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned
(e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3) 2. Conversion or Exercise Price of Derivative Security 3. Transaction Date (Month/Day/Year) 3A. Deemed Execution Date, if any (Month/Day/Year) 4. Transaction Code (Instr. 8) 5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5) 6. Date Exercisable and Expiration Date (Month/Day/Year) 7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4) 8. Price of Derivative Security (Instr. 5) 9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4) 10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4) 11. Nature of Indirect Beneficial Ownership (Instr. 4)
Code V (A) (D) Date Exercisable Expiration Date Title Amount or Number of Shares
Explanation of Responses:
1. On August 31, 2009, Orient Paper, Inc. (the "Company"), the Company's Chief Executive Officer, Zhenyong Liu (the "Reporting Person") and the Company's subsidiary, Hebei Baoding Orient Paper Milling Company Limited ("HBOP") entered into a Debt Assignment and Assumption Agreement (the "Agreement"). Pursuant to the Agreement, the Company agreed to assume $4,000,000 of the total aggregate debt of approximately $6,131,761 (the "Debt") owed by HBOP to the Reporting Person to henceforth be the principal debtor to the Reporting Person for the Debt. On August 31, 2009, the Company repaid the Debt to the Reporting Person by converting the Debt into equity of the Company at $0.83033 per share. Accordingly, the Company issued to the Reporting Person a total of 4,817,362 restricted shares of common stock of the Company. On a post reverse split basis, the number of shares issued pursuant to the Agreement is adjusted to 1,204,341.
2. On October 7, 2009, the Company entered into a Securities Purchase Agreement with Access America Fund, LP, Renaissance US Growth Investment Trust Plc, RENN Global Entrepreneurs Funds, Inc., Premier RENN Entrepreneurial Fund Limited, Pope Investments II, LLC and Steve Mazur (collectively, the "Investors") to sell to them an aggregate of 2,083,333 reverse-split adjusted shares of common stock, par value $0.001 of the Company ("Common Stock") for an aggregate purchase price of approximately $5,000,000 (the "Financing"). As an inducement for the Investors to enter into the Financing, the Reporting Person placed certain of his shares of Common Stock of the Company (the "Escrow Shares") into escrow for the benefit of the Investors in the event the Company fails to achieve certain financial performance thresholds for the 12-month periods ended December 31, 2009 and December 31, 2010 pursuant to a Make Good Securities Escrow Agreement dated October 7, 2009.
3. The Company missed its financial performance threshold for 2010 (the "2010 Performance Threshold") and after consultation with the Investors, the parties compromised on the number of Escrow Shares to be delivered from the Principal Shareholder to the Investors as compensation for missing the 2010 Performance Threshold. On June 30, 2011, the Company entered into a Make Good Securities Escrow Supplement Agreement ("Supplement Agreement") with the Reporting Person, the Investors and Sichenzia Ross Friedman Ference LLP as the Escrow Agent, which provides, inter alia, for the delivery to the Investors of 51,011 Escrow Shares as full and final settlement and restitution for the Company's failure to meet the 2010 Performance Threshold. Accordingly, the Reporting Person transferred 51,011 shares of Common Stock to the Investors.
4. On September 19, 2011, the Reporting Person purchased from the open market a total of 20,000 shares of common stock of the Company at an average price of $2.8116 per share.
5. On September 20, 2011, the Reporting Person purchased from the open market a total of 15,000 shares of common stock of the Company at an average price of $2.9499 per share.
/s/ Zhenyong Liu 09/21/2011
** Signature of Reporting Person Date
Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* If the form is filed by more than one reporting person, see Instruction 4 (b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
Note: File three copies of this Form, one of which must be manually signed. If space is insufficient, see Instruction 6 for procedure.
Persons who respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB Number.