In a red flag alert issued to our premium members Friday, January 13th, 2012, we presented a Chinese SAIC filing and multiple website links showing that the Ping Yi Mine that allegedly represents 37% of LLEN’s production capacity is owned not by LLEN, but by an investment group of four Chinese nationals led by Mr. Hu Shiwei, and that this group is currently offering the mine for sale in China.

1. Conclusive Proof that L&L International (LLEN)
Does Not Own the Ping Yi Mine
In a red flag alert issued to our premium members Friday, January 13th, 2012, we presented
a Chinese SAIC filing and multiple website links showing that the Ping Yi Mine that allegedly
represents 37% of LLEN’s production capacity is owned not by LLEN, but by an investment
group of four Chinese nationals led by Mr. Hu Shiwei, and that this group is currently
offering the mine for sale in China.
(To visit the websites, click here)
There appears to be some confusion on the part of certain LLEN investors as to whether the
SAIC filing that we presented is up to date. There also seems to be some confusion as to
whether the “Ping Yi Mine” referenced in the SAIC filing and on the “For Sale” websites is
the same “Ping Yi Mine” referenced in LLEN’s SEC filings. In what follows, we correct both
of these confusions.

2. Confusion 1: Date of the SAIC Filing
On January 13, 2012, we obtained the most current SAIC filing for the Ping Yi Mine from the
Guizhou SAIC Office. The date of the SAIC file is on the right bottom of the SAIC file as
follows:
Certain LLEN investors have noted the date “2008-08-20”, or August 20th, 2008, written at
the middle of the first page, left side…
…and concluded that this is the “as of” date of the SAIC filing, a date prior to LLEN’s
November 2009 acquisition of the mine, which would mean that the document is
outdated. This conclusion is completely wrong, and reflects a total misunderstanding of the
information contained in the filing.
The reader will notice that there are two dates given in the SAIC filing. The first date,
located halfway down the first page on the left side, “2000-08-02”, is the date that the
Ping Yi Mine was established.
The second date, “2008-08-20” highlighted above, is the date that the business
license reflecting the last change in corporation information was issued or
examined. On that date, the Ping Yi Mine changed its official information from Yidong
Village, Pingguan Town, Pan County to Yiche Village, Pingguan Town, Pan County and
obtained its most recent business license. The SAIC filing is telling us that since that date,
no material aspect of the business structure has changed.
The number of this corporate change is shown on the second line of the following image. As
we see, it is the second corporate change that has taken place since inception.

3. The fact that we see “2008-08-20” is noteworthy because if LLEN acquired the mine on
November 1st of 2009, as they told us in the Ping Yi Acquisition Agreement filed March of
2010, then the date should be “2009-11-01.” It is not.
The owners of the mine posted a chopped image of the original business license on the “For
Sale” website (the first image below). The reader will notice that this license shows the
same date, August 20th 2008, as on the SAIC filing. That is the date that the most recent
version of the business license, shown below and on the website, was issued.
http://www.worldmr.net/Industry/IndustryList/Info/2011-10-11/112458.shtml

4. In passing, we would point out that only the owners of the mine should have this original
document which can only be issued to the legitimate owners of the mine by the
SAIC. The fact that it is posted on the website confirms the credibility of the offer. Equally
interesting is that this business license names the executive partner, Hu Shiwei, which is
as will soon discuss, a 30% partner in the Ping Yi Mine listed on our SAIC document.
Another conclusive match that we would highlight, in passing, pertains to the business
license number on each document. If you squint, you will notice that these are the exact
same numbers. Again, this is not a coincidence.
SAIC Filing pulled by Geoinvesting Original Business License Posted on
Chinese “For Sale” Website
To ensure that the our documentation is accurate and up to date, we called the
sales agent listed on the website, Mr. Wu, and confirmed that the current majority
owner shown on our SAIC filing, Mr. Bao Guo Zhong, is in fact the majority owner, and that
a minority owner shown as the legal representative on the filing, Mr. Hu Shiwei, is in fact a
minority owner and the legal representative. We asked this individual whether LLEN
has ever owned the Ping Yi mine. He answered no several times. He indicated that
there was a negotiation of a potential acquisition with LLEN, but that the deal never closed.
He stated that currently, the Ping Yi Mine is still owned by a group of individuals unrelated
to LLEN.

5. Confusion 2: Identity of the “Ping Yi Mine”
Certain LLEN investors have cited different descriptions of the mines production capacity
and reserve size, questioning whether we’ve identified the correct mine.
Conducting a cursory comparison of LLEN’s SEC filings, our SAIC filing, and the website
solicitations leaves no doubt that the “Ping Yi Mine” that the company claims to own is the
same “Ping Yi Mine” whose SAIC filing we pulled, and the same “Ping Yi Mine” that the
investment group is currently trying to sell.
LLEN states the name of the mine as Pan County Ping Yi Coal Mine (盘县平关镇平迤煤矿)
(p.11, 10-K) and the location as Yiche Village, Ping Guan Town, Liu Panshui City, Pan
County, Guizhou Province (贵州省六盘水市盘县平关镇迤车村) (Ping Yi Acquisition Agreement as
well as the LLEN website shown below).
This is the same name and location given in the SAIC filing that we provided, as well as the
business license posted on the “For Sale” website.
SAIC Filing
Business License

6. We cannot find any Chinese archives and registries that show any other mine in
Yiche village with even a remotely similar name to Ping Yi. We therefore conclude that that
LLEN and the Chinese investment group are referring to exactly the same “Ping Yi Mine.”
For more conclusive proof, consider that LLEN discloses in its SEC filings an area for the
Ping Yi Mine that is the exact same value as the area stated on the mining permit given on
one of the “For Sale” websites, as well as on all of the other web solicitations. (Note that the
mining permit is different from the business license and is the third image down).
LLEN S-1 filing, p. 42 Mining Permit on “For Sale” Website
LLEN Website References at Additional Solicitations
Clearly, we are talking about the same mine. Investors that wish to argue the point
should ask themselves: what is the probability that there would be two mines with the
same name, located in the same village, in the same town, in the same province, in the

7. same country, with exactly the same area, to five significant figures, including the location
of the decimal place, 2.2694KM2? We believe the Real-world answer: zero.
For yet more proof, consider that LLEN’s website states that Bao Guo Zhang was the
operator of the mine prior to LLEN’s acquisition.
That name, Bao Guo Zhang (保国 张), when put into Chinese form (last name first), gives
Zhang Baoguo, the name of the majority 40% owner of Ping Yi listed on the SAIC filing.
Consider also that LLEN claims that the scale of production of the mine was “150,000 ton
per year based on current mine operating conditions,” which is the same number shown
on the mining permit in the “For Sale” posting.
LLEN Website SAIC Filing for Ping Yi Mine
LLEN 2011 10-K Page 11 Mining Permit on “For Sale” Website
Note that LLEN claims in the Ping Yi Acquisition Agreement that Bao Guo Zhang is the legal
representative of the mine. But the SAIC filing shows that he is only the majority owner,
having paid in 20MM RMB out of the 50MM RMB registered capital (40% owner). The true
legal representative is actually listed as Hu Shiwei (30% owner). We suspect that
LLEN, when they put this acquisition story for investors, made the mistake of assuming that
the majority owner of the mine would necessarily be the legal representative. Not the case.
LLEN states that the mine has 150,000 tons of capacity and 13.506 million tons of reserves.
The 150,000 ton number is seen on the mine permit above, so there is no discrepancy
there.

8. The reserve estimates posted on the “For Sale” postings vary for proven, probable and
possible reserves.
But nowhere do you find LLEN’s stated number of 13.506 million tons. LLEN claims to have
gotten that number from the Guizhou Land Survey & Plan Institute report dated January
2008. However, but since the results of reserve analyses tend to show significant
variability, we think that it is perfectly conceivable that the reserve number could have
increased in subsequent analyses. Furthermore, the base date for the proven, probable and
possible reserves is at the end of Oct. 2010, which is almost three years later than the base
date mentioned by LLEN in its SEC files. Also, the sellers are trying to sell something, so it
would not surprise us if they are being generous.
To eliminate any possible question that may exist about the accuracy of our on-the-
ground investigative work, we will now provide conclusive proof that the Ping Yi Mine that
LLEN has claimed to fully own for over two years is currently up for sale in China by its true
owners. The following document from China Natural Resource News, dated May 5, 2010,
seven months after LLEN claims to have purchased Ping Yi Mine, provides information on
mines by permit number. This information shall be provided by the Natural Resource
Bureau of Guizhou Province, a governmental agency.
http://www.mlr.gov.cn/kqsc/ckq/ckqgsgg/201005/P020100505402392203765.pdf

9. It lists the permit number 5200000830765. Next to that number is Pan County Pingguan
Ping Yi Mine, with the name of the 30% owner and legal representative, Hu Shiwei (胡士
卫).
For a closeup, see the following image:
The reader will recognize this information from the mine permit on the “For Sale” website:

10. And also from the SAIC filing that we presented:
Nowhere in the May 5, 2010 China Natural Resource News document do we see a
mention of L&L energy, KMC, Baoxing Economic and Trade Company, Dickson Lee, or any
recognizable affiliate or hired spokesperson of LLEN listed in conjunction with the Ping Yi
Mine, as should be the case if LLEN acquired the mine in November of 2009.
In conclusion, we hope that what we have written here helps to resolve any confusion that
LLEN investors may have had regarding the timeliness and accuracy of our documentation,
or the identity of the now famous “Ping Yi Mine.” Given our experiences in the China RTO
space, we fully expect LLEN management to conjure up convoluted explanations to vindicate
the company. At this point, we think investors have come to know better than to trust such
explanations, especially in the face of strong on-the-ground evidence. In this case, we
believe that the evidence is overwhelming: the Ping Yi Mine is currently up for sale in China,
and LLEN has never been its owner.
Before closing, we wish to reiterate that we made ourselves fully available to LLEN’s CEO
Dickson Lee to discuss these findings by phone, but he was unable to commit to a call. We
think we know the reason why.
Disclosure: Short LLEN

11. Exhibit 1 – Translated SAIC Filing for Ping Yi Mine, p. 1

12. Exhibit 2 – Translated SAIC Filing for Ping Yi Mine, p. 2

13. Exhibit 3 – Translated Business License for Ping Yi Mine

14. Exhibit 4 – Translated Mining Permit for Ping Yi Mine

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