0001144204-11-055571.txt : 20110929 0001144204-11-055571.hdr.sgml : 20110929 20110929160634 ACCESSION NUMBER: 0001144204-11-055571 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20110929 DATE AS OF CHANGE: 20110929 GROUP MEMBERS: JIANZHONG ZUO SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: LianDi Clean Technology Inc. CENTRAL INDEX KEY: 0001353386 STANDARD INDUSTRIAL CLASSIFICATION: GENERAL BUILDING CONTRACTORS - NONRESIDENTIAL BUILDINGS [1540] IRS NUMBER: 752834498 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-85370 FILM NUMBER: 111114646 BUSINESS ADDRESS: STREET 1: 1111 HUGHES COURT CITY: WYLIE STATE: TX ZIP: 75098 BUSINESS PHONE: 972-442-4314 MAIL ADDRESS: STREET 1: 1111 HUGHES COURT CITY: WYLIE STATE: TX ZIP: 75098 FORMER COMPANY: FORMER CONFORMED NAME: REMEDIATION SERVICES, INC. DATE OF NAME CHANGE: 20080103 FORMER COMPANY: FORMER CONFORMED NAME: SLOPESTYLE CORP DATE OF NAME CHANGE: 20060214 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: China LianDi Energy Resources Engineering Technology Ltd. CENTRAL INDEX KEY: 0001487013 IRS NUMBER: 000000000 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: UNIT 1850,18/F,TOWER TWO, LIPPO CENTRE STREET 2: NO.89 QUEENSWAY CITY: HONG KONG STATE: K3 ZIP: 00000 BUSINESS PHONE: 00852-28400336 MAIL ADDRESS: STREET 1: UNIT 1850,18/F,TOWER TWO, LIPPO CENTRE STREET 2: NO.89 QUEENSWAY CITY: HONG KONG STATE: K3 ZIP: 00000 SC 13D/A 1 v235942_sc13da.htm AMENDMENT TO SCHEDULE 13D Unassociated Document
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549
 
SCHEDULE 13D
 
(Amendment No. 1)
 
Under the Securities Exchange Act of 1934
 
LianDi Clean Technology Inc.
(Name of Issuer)
 
Common Stock
(Title of Class of Securities)
 
75954P102
(CUSIP Number)
 
Jianzhong Zuo, c/o China LianDi Clean Technology Engineering Ltd.
4th Floor Tower B. Wanliuxingui Building, No. 28 Wanquanzhuang Road, Haidian District,
Beijing, 100089  China
(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)
 
September 27, 2011
(Date of Event which Requires Filing of this Statement)
 
 
If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(b)(3) or (4), check the following box o.
 
Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.

 
 
 
 
CUSIP No. 75954P102 13D Page 2 of 6 Pages
 
 
1
NAME OF REPORTING PERSON
 
Jianzhong Zuo
  
2
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a)              ¨    
(b)              ¨    
3
SEC USE ONLY
4
SOURCE OF FUNDS*
 
OO
5
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
o    
6
CITIZENSHIP OR PLACE OF ORGANIZATION
 
China
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH
7
SOLE VOTING POWER
 
5,284,660
8
SHARED VOTING POWER
 
0
9
SOLE DISPOSITIVE POWER
 
5,284,660
10
SHARED DISPOSITIVE POWER
 
0
11
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
 
5,284,660 (1)
12
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
o    
13
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
 
16.8% (2)
14
TYPE OF REPORTING PERSON*
 
IN
 
(1)  Represents shares of common stock held by China LianDi Energy Resources Engineering Technology Ltd. Mr. Zuo holds sole voting and dispositive power over the shares of common stock held by this entity.
 
(2)  Based on 31,458,445 shares of common stock outstanding as reported in LianDi Clean Technology Inc.’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on August 15, 2011.
 
 
 
 
 
CUSIP No. 75954P102 13D Page 3 of 6 Pages
 
 
1
NAME OF REPORTING PERSON
 
China LianDi Energy Resources Engineering Technology Ltd.
 
  
2
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a)              ¨    
(b)              ¨    
3
SEC USE ONLY
4
SOURCE OF FUNDS*
 
OO
5
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
o    
6
CITIZENSHIP OR PLACE OF ORGANIZATION
 
British Virgin Islands
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH
7
SOLE VOTING POWER
 
5,284,660
8
SHARED VOTING POWER
 
0
9
SOLE DISPOSITIVE POWER
 
5,284,660
10
SHARED DISPOSITIVE POWER
 
0
11
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
 
5,284,660
12
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
o    
13
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
 
16.8% (1)
14
TYPE OF REPORTING PERSON*
 
CO
 
(1) Based on 31,458,445 shares of common stock outstanding as reported in LianDi Clean Technology Inc.’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on August 15, 2011.
 
 
 
 
 
CUSIP No. 75954P102 13D Page 4 of 6 Pages
 
 
EXPLANATORY NOTE
 
 
This Amendment No. 1 to Schedule 13D amends and supplements the original Schedule 13D (the “Original Schedule 13D”) filed by the Reporting Persons with the Securities and Exchange Commission on March 15, 2011.  This Amendment, together with the Original Schedule 13D, is hereby referred to as the “Schedule 13D.”
 
 Except as specifically amended below, all other provisions of the Schedule 13D remain in effect.
 
Item 2. 
Identity and Background.

(a) This Schedule 13D is filed by Jianzhong Zuo (“Mr. Zuo”) and China LianDi Energy Resources Engineering Technology Ltd. (“LianDi Energy”) (collectively the “Reporting Persons”), as shareholders of the Company.
 
(b) The business address and principal office of the Reporting Persons is 4th Floor Tower B. Wanliuxingui Building, No. 28 Wanquanzhuang Road, Haidian District, Beijing, 100089 China.
 
(c) Mr. Zuo is the Chairman, Chief Executive Officer and President of the Company.  Mr. Zuo is a director and the sole stockholder of LianDi Energy.  
 
(d) During the past five years, the Reporting Persons have not been convicted in a criminal proceeding (excluding traffic violations and similar misdemeanors).
 
(e) During the past five years, the Reporting Persons have not been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding, was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.
 
(f) Mr. Zuo is a citizen of China.   LianDi Energy is a company incorporated under the laws of the British Virgin Islands.
 
Item 3. 
Source and Amount of Funds and Other Consideration.
 
On September 27, 2011, LianDi Energy, Mr. Zuo and SJ Asia Pacific Ltd. (“SJ Asia”) consummated the transactions contemplated by the Share Purchase Agreement (the “Share Purchase Agreement”) dated as of September 22, 2011 relating to the purchase by SJ Asia from LianDi Energy of 5,400,000 shares of Common Stock in exchange for an aggregate purchase price of $25,920,000 ($4.80 per share).  As a result of this sale by LianDi Energy, Mr. Zuo and LianDi Energy beneficially own in the aggregate 5,284,660 shares of Common Stock.  The source of funds used for this investment was the capital increase of SJI, Inc., which is the sole shareholder of SJ Asia.  The foregoing description of the Share Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Share Purchase Agreement, attached as Exhibit 10.1 to this Schedule 13D and is incorporated herein by reference
 
 
 
 
CUSIP No. 75954P102 13D Page 5 of 6 Pages
 
 
Item 4. 
Purpose of Transaction.
   
The purpose of the Share Purchase Agreement and the transactions contemplated thereby was for SJ Asia to acquire in excess of 51% of the outstanding shares of Common Stock and consolidate the Company’s business with that of SJI, Inc., the parent company of SJ Asia.
  
Item 5. 
Interest in Securities of the Company.
 
(a)       The Reporting Persons beneficially own an aggregate of 5,284,660 shares of Common Stock, representing approximately 16.8% of the total issued and outstanding shares of Common Stock.   Although Mr. Zuo directly owns none of the Common Stock, he may be deemed to be the beneficial owner of the shares of Common Stock held by LianDi Energy pursuant to Rule 13d-3 of the Securities Exchange Act of 1934, as amended.
 
(b)       Mr. Zuo has the sole power to vote or to direct the vote, and sole power to dispose or direct the disposition of 5,284,660 shares of Common Stock held by LianDi Energy.
 
(c)       Other than the acquisition of the shares of Common Stock as reported in this Schedule 13D, the Reporting Persons have not effected any transactions in the Common Stock of the Company in the past sixty (60) days.
 
(d)       No other person is known to have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of the shares owned by the Reporting Persons.
 
(e)       Not applicable.
 
Item 6. 
Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer.
 
In addition to the Share Purchase Agreement described above under Item 3, LianDi Energy is also subject to a lock-up agreement with the Company that it entered into on February 26, 2010 whereby LianDi Energy agreed, among other things, that it may only sell up to one-twelfth (1/12) of LianDi Energy’s holdings every month through February 20, 2012.   The foregoing description of the lock-up agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the lock-up agreement attached as Exhibit 10.4 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on March 4, 2010 and is incorporated herein by reference.

Item 7.
Materials to be Filed as Exhibits.

Exhibit No.:
Title:
   
10.1 Share Purchase Agreement dated as of September 22, 2011 by and among SJ Asia Pacific Ltd., LianDi Energy and Mr. Zuo.
   
10.4 Lock-up Agreement with China LianDi Energy Resources Engineering Technology Ltd. dated February 26, 2010. (1)
 
_________________
 
(1) Incorporated by reference to the corresponding exhibit to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on March 4, 2010.
 
 
 
 
 
SIGNATURES
 
 
After reasonable inquiry and to the best of my knowledge and belief, the undersigned certify that the information set forth in this Schedule 13D is true, complete and correct.
 
Dated:  September 29, 2011
 
     
     
By:
 
/s/ Jianzhong Zuo
  
Name:
 
Jianzhong Zuo
  

       
CHINA LIANDI ENERGY RESOURCES ENGINEERING TECHNOLOGY LTD.
  
     
By:
 
 /s/ Jianzhong Zuo  
Name:
 
Jianzhong Zuo
  
Title:
 
Director
  
 
 
 
 
EX-10.1 2 v235942_ex10-1.htm EXHIBIT 10.1
SHARE PURCHASE AGREEMENT

This SHARE PURCHASE AGREEMENT (“Agreement”) is made and entered into as of the 22nd day of September, 2011 by and among China LianDi Energy Resources Engineering Technology Limited, a corporation organized under the laws of the British Virgin Islands (hereinafter referred to “BVI Law”) having registered office at P.O. Box 957, Offshore Incorporations Centre, Road Town, Tortola, British Virgin Islands (hereinafter referred to “the Seller”), SJ Asia Pacific Limited, a corporation organized under the BVI Law having registered office at P.O. Box 146, Road Town, Tortola, British Virgin Islands (hereinafter referred to as “the Buyer”), and Zuo Jianzhong, a CEO of the Seller, (hereinafter referred to “Zuo”).  The Seller or the Buyer sometimes is referred to as “Party” and collectively as “Parties”.

RECITALS

A.           The Seller is the owner of 5,400,000 outstanding ordinary shares of LianDi Clean Technology Inc., a corporation organized under the laws of the State of Nevada, (hereinafter referred to “The Company”).

B.           The Buyer desires to purchase from the Seller, and the Seller desires to sell to the Buyer, all of the said 5,400,000 shares held by The Seller.

NOW, THEREFORE, in consideration of the mutual promises, representations, warranties, covenants and agreements contained herein, the Parties and Zuo, intending to be legally bound, hereby agree as follows:

Article 1 
Sales and Purchase of Shares
1.1
The Parties agree that the Seller sells to the Buyer and the Buyer purchases from the Seller 5,400,000 outstanding ordinary shares of 10,684,660 outstanding ordinary shares of the Company held by the Seller (hereinafter referred to as “Shares”) at the total price of US Dollars 25,920,000 (US$4.8 per share) (such total price is hereinafter referred to as “Purchase Price” and this transfer of Shares is hereinafter referred to as “Transaction”).

1.2
The Purchase Price may not be modified unless agreed in writing by the Parties.
 
 
1 / 14
 
 
1.3
All taxes imposed with respect to the Transaction shall be borne by the Seller.

Article 2 
Closing
 
2.1
The closing of the Transaction (“Closing”) shall take place at Tokyo, Japan on September 27 , 2011(“Closing Date”).

2.2
On the Closing Date, the Seller shall transfer the Shares to the Buyer . In connection with the Transaction, the Seller shall apply for the registration of transfer of the Shares from the Seller to the Buyer on the Closing Date. Further, the Seller and Zuo shall cause the Company to provide the necessary cooperation in such registration of transfer of the Shares.

2.3
The Seller shall deliver to the Buyer a certificate for the application of transfer of the Shares by September 29, 2011.
 
2.4
On the Closing Date, the Buyer shall make arrangement for the payment of the Purchase Price by bank transfer to the Seller’s bank account designated below.  US$7,517,472.60 of The Purchase Price shall be paid in US Dollars and the remaining US$18,402,597.40 of the Purchase Price shall be converted into Japanese Yen 1,417,000,000 based on the exchange rate on September 13, 2011 and remitted to the following the Seller’s bank account unless otherwise agreed between the Parties.  Costs for the remittance shall be borne by the Buyer.
 
(1)
Bank account information for the transfer in Japanese Yen
 
Bank name
：
Mizuho bank（SWIFT code; MHBKJPJT）
Branch
：
KABUTOCHO Branch
Branch Code
：
027
Branch Address
：
4-3 Nipponbashi - Kabuto-cho, Chuo-ku, Tokyo 103-0026 JP
Account Number
：
2134871
Account Name
：
CHINA LIANDI ENERGY RESOURCES ENGINEERING TECHNOLOGY LIMITED
 
 
(2)
Bank account information for the transfer in US Dollar
 
Bank Name:
  
The Hong Kong and Shanghai Banking Corporation Limited
Bank Address:
  
Lever 10, HSBC Main building
   
1 Queen's Road Central, Hong Kong
Swift Code:
  
HSBCHKHHHKH
   
Account Number: 848-141891-838
Account Name:
  
China Liandi Energy Resources Engineering Technology Limited
Company Address:
  
Unit 1103, 11/F., Tower Two, Lippo Centre
   
89 Queensway, Admiralty, Hong Kong
 
 
2 / 14
 
 
2.5
Notwithstanding the preceding clause, the Seller shall extend the due date of the payment to October 17, 2011 for the payment of US$18,402,597.40 (Japanese Yen 1,417,000,000) of the Purchase Price by the Buyer.

2.6
Upon the completion of the procedures as set forth in this Article, the Transaction is fully completed.

Article 3 
Conditions Precedent
3.1
The obligation of the Seller under this Agreement shall be subject to the fulfillment as of the Closing Date of the following conditions:
 
(i)
the representations and warranties of the Buyer set forth in Article 4 shall be true and correct as of the Closing Date and the date of this Agreement; and
 
(ii)
all procedures required for the Transaction under the laws and other internal rules of the Buyer shall have been completed.

3.2
The obligation of the Buyer under this Agreement shall be subject to the fulfillment as of the Closing Date of the following conditions:
 
 (i)
the representations and warranties of the Seller set forth in Article 5 shall be true and correct as of the Closing Date and the date of this Agreement;
 
 (ii)
the number of outstanding shares of the Company is the total of 36,444,850 (ordinary shares and preferred shares), and The Seller solely, lawfully and effectively owns 10,684,660 of such ordinary shares;
 
 (iii)
during the period from the date of this Agreement to the Closing Date there shall not have occurred any events which would likely to have a material adverse effect on the value of the Transaction;
 
 (iv)
all procedures required for the Transaction under the laws and other internal rules of the Seller shall have been completed;
 
 
3 / 14
 
 
 
 (v)
all governmental approvals, consents or filings required for the Transaction shall have been obtained or completed;
 
 (vi)
subscription agreement for the newly issued ordinary shares of SJI Inc. shall have been effectively executed by and among SJI Inc.,  Zuo, and The Seller; and
 
(vii)
all procedures required for the Transaction under the laws and other internal rules of the Company shall have been completed.

Article 4 
Representations and Warranties of the Buyer
4.1
The Buyer hereby represents and warrants to The Seller that the following shall be true and correct as of the Closing Date and the date of this Agreement:
 
 (i)
the Buyer is a corporation duly organized, validly existing and in good standing under the BVI Laws, and has all requisite power and authority to execute the Agreement and to perform its obligations hereunder;
 
 (ii)
with respect to the execution and performance of this Agreement, the Buyer is in conformity with laws, government orders, official  notices, rules, orders, ordinances, guidelines and other regulations (“Laws and Ordinances”) or internal rules of the Buyer and has completed all procedures required under the same;
 
 (iii)
the Buyer has obtained and completed all governmental licenses, approvals, consents, filings and other legal procedures required for the execution and performance of this Agreement, and neither the execution nor the performance of this Agreement by the Buyer will violate, breach or be in conflict with any administrative order issued by any governmental authorities;
 
 (iv)
neither the execution nor the performance of this Agreement by the Buyer will violate, breach or be in conflict with any judgment, ruling, order, judicial compromise or other decisions made by courts, arbitrators, arbitral institutions, other judicial institutions and self-regulatory organizations;
 
 (v)
no agreements which prevent the performance of the Buyer’s obligations hereunder have been executed between the Buyer and any third party; and
 
(vi)
there has not been any facts, with respect to the business, assets, operation and financial situation of the Buyer, which would likely to have a material adverse effect on the performance of obligations hereunder. The Buyer especially represents and warrants that the Buyer has the capacity to pay the Purchase Price to the Seller.
 
 
4 / 14
 
 
Article 5 
Representations and Warranties of the Seller and Zuo
5.1 The Seller and Zuo hereby jointly and severally represent and warrant to the Buyer that the following shall be true and correct as of the Closing Date and the date of this Agreement:
 
(i)
the Seller is a corporation duly organized, validly existing and in good standing under the BVI Laws, and has all requisite power and authority to execute the Agreement and to perform its obligations hereunder;
 
(ii)
with respect to the execution and performance of this Agreement, the Seller is in conformity with laws and ordinances or internal rules of the Seller and has completed all procedures required under the same;
 
(iii)
the Seller has obtained and completed all governmental licenses, approvals, consents, filings and other legal procedures required for the execution and performance of this Agreement, and has caused the Company obtained and completed all governmental licenses, approvals, consents, filings and other legal procedures required for the execution and performance of this Agreement, and neither the execution nor the performance of this Agreement by the Seller will violate, breach or be in conflict with any administrative order issued by any governmental authorities;
 
(iv)
neither the execution or the performance of this Agreement by the Seller will violate, breach or be in conflict with any judgment, ruling, order, judicial compromise or other decisions made by courts, arbitrators, arbitral institutions, other judicial institutions and self-regulatory organizations;
 
(v)
no agreements which prevent the performance of obligations hereunder, including but not limited to an agreement by which other shareholders or creditors of the Company can bring damage claim against the Company for the execution or the performance of the Agreement, have been executed between the Seller or Zuo, and any third party;
 
 
5 / 14
 
 
 
 (vi)
the number of outstanding stock of the Company under its articles of incorporation is the total of 36,444,850 (ordinary shares and preferred shares), and the shares of the Company are free of preemptive rights, stock acquisition rights, convertible bonds, other securities convertible to or exchangeable for the Company’s shares, warrants, rights to purchase or otherwise acquire shares, or options or any other rights, except as provided in clause (vii) below;
 
 (vii)
it is unlikely that any warrant or option issued by the Company is exercised. If any of the warrants or options is exercised, the Seller immediately sells to the Buyer at its exercised price the number of ordinary shares of the Company held by the Seller equal to fifty-one percent (51%) of the number of ordinary shares of the Company purchased by exercising such warrants or options;
 
(viii)
as of the date of this Agreement, the Seller lawfully and effectively owns 10,684,660 of ordinary shares in the Company, is the beneficial and sole record shareholder of all of such ordinary shares and such ordinary shares are free of pledges, liens, mortgages, other charges or any other encumbrances;
 
 (ix)
the Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Nevada, and has all requisite power and authority to operate businesses it presently conducts;
 
 (x)
the Company (including its affiliates it directly or indirectly owns) complies with applicable laws and regulations with respect to businesses it presently conducts;
 
 (xi)
financial statements of the Company (including its affiliates it directly or indirectly owns) as of June 30, 2011 have been prepared in accordance with generally accepted accounting principle in the United States, present fairy financial conditions and results of operations of the Company (including its affiliates it directly or indirectly owns) as of the times and for the periods referred to therein, are consistent with the books and records of the Company (including its affiliates it directly or indirectly owns) and contain no undisclosed liabilities;
 
 (xii)
all taxes due and payable have been paid in full by the Company  (including its affiliates it directly or indirectly owns);
 
 (xiii)
there has not been any facts, with respect to the business, assets, operation and financial situation of the Seller and the Company (including its affiliates it directly or indirectly owns), which would likely to have a material adverse effect on the performance of obligations hereunder;
 
 
6 / 14
 
 
 
 (xiv)
even if there happens any change in shareholders of the Company, The Seller makes its best efforts to retain major officers, employees and customers of the Company (including its affiliates it directly or indirectly owns) and to prevent outflow of property of the Company (including its affiliates it directly or indirectly owns);
 
 (xv)
certificates of shares to be delivered by the Seller to the Buyer for the Transaction are true and effective certificates of shares of the Company;
 
 (xvi)
the Company has disclosed to the Buyer all the information which would have material effect on decisions by the Buyer related to this Agreement, all the information which has been disclosed by the Company to the Buyer (including to certified accountants, attorneys and other advisors retained by the Buyer) is true and correct and no facts have been deleted or omitted from such information which are necessary for descriptions and information contained in this Agreement to be free of any misunderstanding;
 
 (xvii)
the Seller and Zuo provide SJI Inc and the Buyer with assistance and advice as to all procedures required in U.S. including correction of any mistake if any.
 
Article 6
Cooperate Governance
6.1
Considering that the Seller and the Buyer continue to be major shareholders of the Company, the Seller and the Buyer continue to cooperate in the governance of the Company after the Transaction.
6.2
Being an incorporator and a major shareholder through the Seller, Zuo shall carry out the business of the Company by cooperating with SJI Inc. even after the Transaction.
6.3
The Seller and Zuo shall develop the business plan of the Company for the next 3 years and deliver it to the Buyer.
6.4
Considering that SJI Inc. become to hold the majority of voting rights of the Company through the Buyer and Hua Shen (International) Limited, when carrying out the business as described in 6.2, Zuo shall cause the Company to obtain prior written consent of SJI Inc for the material matters of the Company provided below.
 
 
7 / 14
 
 
 
(i)
sale, merger, acquisition, or other corporate restructuring of the Subsidiaries of the Company (hereinafter, “the Subsidiary of the Company” includes both subsidiary of the Company and company controlled by the subsidiary of the Company. );
 
(ii) 
merger or other corporate restructuring of the Company;
 
(iii) 
deregistration of the Company from the OTC Bulletin Board;
 
(iv)
listing or preparation for listing on security market by the Company;
 
(v)
sale, morgage or any other disposal of material assets (more than ten (10) % of the consolidated net assets) of the Company or the Subsidiary of the Company;
 
(vi)
issuance or cancellation of its shares, warrants, corporate bond, or any other securities or rights by the Company or the Subsidiary of the Company; or
 
(viii)
any other matter discussed and agreed as material matter between the Seller and the Buyer, or the Seller and SJI Inc.
6.5
The Seller or SJI Inc may dispatch its personnel to the Company after the Closing Date.
6.6
The Buyer has an option to request the Seller or Zuo to purchase a part or all of the Shares subject to the terms and conditions as agreed separately, if the business plan developed by the Seller and Zuo as specified in Article 6.3 is not accomplished.

Article 7 
Compensation
7.1
If either Party incurs any damage, loss or costs (including, without limitations, attorney’s fees) (hereinafter referred to as “Damages”) resulting from any breach of the other Party of this Agreement or of its representations and warranties as respectively set forth in Article 4 or Article 5 occurring during the period of five (5) years after the Closing Date, the breaching Party shall immediately indemnify the non-breaching Party for such Damages. Below article 6.1 in this Agreement, “the other Party” means both the Seller and Zuo, if the main Party is the Buyer, and “the other Party” means the Buyer, if the Party is the Seller or Zuo.
7.2
In case the Company incurs the Damages due to the breach of any obligation of this Agreement by Seller or Zuo or the breach of the representations and warranties under Article 4 or 5, such all Damages is deemed to be damages incurred by Buyer.
 
 
8 / 14
 
 
7.3
In case the Seller, the Buyer or Zuo fails to perform the obligation under the Agreement, the other Party may seek the enforcement, and in case any of them proceed any action which is prohibited under this Agreement, the other Party may seek injunction. The other Party may bring both claims under this article and article 7.1.

Article 8  
Termination for Cause
8.1
If any of the followings occurs to the Seller, the Buyer or Zuo prior to the completion of the Transaction, the other Party may terminate this Agreement by giving written notice to the Party:
 
 (i)
attachment, provisional attachment, provisional disposition or other execution;
 
 (ii)
dissolution, commencement of proceedings of bankruptcy, civil rehabilitation, corporate reorganization or liquidation (or other similar proceedings) is ordered or petition for such proceedings is filed;
 
 (iii)
collection procedures for tax delinquency;
 
 (iv)
material or significant deterioration of financial situation or threat thereof;
 
 (v)
any false entry due to willful misconduct or gross negligence is found in The Buyer’s publicly released financial statements;
 
 (vi)
revocation of business license, suspension of business or other dispositions are made by regulatory agencies;
 
 (vii)
dissolution, merger, corporate split or transfer of business is made without prior consultation; or
 
 (viii)
substantial change in the control of the Party, including, without limitation, changes in major shareholders.

8.2
If any of the following events of default occurs to the Seller, the Buyer or Zuo prior to the completion of the Transaction and the Party in default fails to cure the events of default within thirty (30) days of the other Party’s written notice demanding such cure, the other Party may terminate this Agreement by giving a written notice to the Party in default:
 
 (i)
breach of any obligation under this Agreement; or
 
 (ii)
breach of its representations or warranties.
 
 
9 / 14
 
 
8.3
If this Transaction is not consummated on or before November 15, 2011 and such failure of consummation is confirmed in writing upon consultations between the Seller and the Buyer, the Seller or the Buyer may terminate this Agreement except where there is a breach by the terminating Party of its obligations, representations or warranties.

Article 9 
Termination for Force Majeure
9.1
If performance of this Agreement is objectively deemed difficult due to a substantial change in the economic situation, acts of God or any other inevitable cause, either Party may terminate this Agreement upon consultations without assuming any liability for such termination.
 
Article 10 
Confidentiality
10.1
For two (2) years after execution of this Agreement, the Seller, the Buyer and Zuo shall keep secret the existence and contents of this Agreement, developments of negotiations about this Agreement (including due diligence) and other information of the other Party obtained related to execution of this Agreement whether before or after the execution and shall not disclose the same to any third party or use the same for any purpose other than this Agreement.  Provided, however, that either Party may disclose such information if such disclosure is made to its executives and employees, attorneys, certified accountants, tax accountants, financial advisors or other professionals or is required under the laws of US Federal and State or Japan or the regulations of security exchanges of Japan or US, on the condition that, in either case, the Party to disclose such information shall notify the other Party thereof before disclosure so that the other Party has a reasonable time to take appropriate measures against such a disclosure.

10.2
Notwithstanding the provisions of the preceding paragraph, the Seller, the Buyer and Zuo shall not assume confidentiality obligation if:
 
 (i)
the information was already possessed by the receiving Party or publicly known at the time of disclosure or it becoming aware of such information;
 
 (ii)
the information becomes publicly known after disclosure or the receiving Party becoming aware of such information through no willful conduct or negligence of the receiving Party;
 
 
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 (iii)
the information is lawfully received from a third party duly authorized to disclose without assuming confidentiality obligation; or
 
 (iv)
the information is independently developed by the receiving Party without referring to the information disclosed by the other Party.

Article 11 
Public Announcement
11.1 
If either Party makes a public announcement related to the Transaction, such announcement shall be made after consultations and as agreed by the both Parties on the contents, timing and manner of the announcement except where such an announcement is required under the laws of US Federal and State or Japan or the regulations of security exchanges of Japan or US; in such a case, the Party to make such announcement shall notify the other Party thereof before the announcement so that the other Party has a reasonable time to take appropriate measures against such an announcement.

Article 12 
No Assignment
12.1 
The Seller, the Buyer and Zuo may not, without the prior written approval of the other Party, assign, mortgage or otherwise dispose of its contractual status, rights or obligations under this Agreement to any third party nor cause any third party to assume the same. Nothing in this paragraph prohibits the Seller from sale, mortgage or otherwise dispose of the shares of the Company after the Closing Date.

Article 13 
Taxes and Expenses
13.1 
Unless otherwise provided for in this Agreement, the Seller, the Buyer and Zuo shall bear taxes imposed on itself in connection with this Agreement.  Stamp duties imposed in connection with performance of this Agreement shall be equally borne by both Parties.

13.2
Unless otherwise provided for in this Agreement, the Seller, the Buyer and Zuo shall bear its own costs and expenses, including fees and expenses for attorneys, certified accountants and other third parties, incurred in connection with the negotiation (including due diligence), preparation, execution and performance of this Agreement except for the expenses incurred in connection with the claim for damages or other remedies due to any default of the other Party.
 
 
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Article 14 
Notice
14.1 
Unless otherwise provided for in this Agreement or separately agreed in writing by both Parties and Zuo, all communications to be made under this Agreement, including, without limitation, notices and provision of information, shall be in writing and given by facsimile, e-mail, personal delivery or mail to the following contact persons.  Each Party and Zuo may change its contact information or contact person by notice given to the other Party in accordance with this Article.

The Seller:
 
Address:
  
Rm1103， 11/F, Tower Two, Lippo Centre, 89 Queensway, Admiralty, Hong Kong
Facsimile:
  
+85-2-2840-0488
E-mail:
  
jzhzuo@yahoo.com
Contact Person:
  
Zuo, JianZhong
 
The Buyer:
Address:
  
c/o  SJI Inc.
   
4-12-8 Higashi Shinagawa Shinagawa-ku, Tokyo, 140-0002 Japan
Facsimile:
  
+81-3-3472-6295
E-mail:
  
tano-daichi@sji-inc.jp
Contact Person:
  
Daichi Tano
 
Zuo
 
Address:
Rm1103， 11/F, Tower Two, Lippo Centre, 89 Queensway, Admiralty, Hong Kong
Facsimile:
+85-2-2840-0488
E-mail:
jzhzuo@yahoo.com
Contact Person:
Zuo, JianZhong
 
Article 15 
Entire Agreement
15.1 
This Agreement constitutes the entire agreement between the Parties regarding the Transaction.  Any prior contract, agreement, commitment or covenant regarding the Transaction, whether written or oral, shall be invalid to the extent inconsistent with this Agreement.
 
 
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Article 16 
Amendment
16.1 
This Agreement may not be amended or modified without the prior written consent of both Parties and Zuo.

Article 17 
Governing Law and Language
17.1 
This Agreement and any and all rights and obligations related to this Agreement shall be governed by and construed in accordance with the laws of Japan.

17.2 
This Agreement shall be signed and executed in Japanese, Chinese and English. In case there is any discrepancy or conflict among the Japanese version, Chinese version and English version, the Japanese version shall prevail.

Article 18 
Arbitration
18.1
Any disputes, controversies, or differences arising between or among the Seller, the Buyer and Zuo in connection with this Agreement shall be settled by arbitration in Tokyo, Japan in accordance with the rules and procedures of the Japan Commercial Arbitration Association.  The arbitral institution shall be the Tokyo office of the said Association.  The number of arbitrator shall be one (1) and arbitration shall be conducted in the Japanese language.
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IN WITNESS WHEREOF, the Parties have caused this Share Purchase Agreement to be executed in three (3) originals as of the date first written above by their respective officers thereunto duly authorized, each Party and Zuo retaining one (1) copy thereof respectively.

September 22 , 2011

The Seller:
 
China LianDi Energy Resources Engineering Technology Limited
 
By:
Name:
Title:
 
The Buyer:
 
SJ Asia Pacific Limited
 
By:
Name:
Title:
 
Zuo:
 
Zuo Jianzhong
 
 
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