In 19 century China, Jungle Village is home to several warring clans. The village blacksmith creates deadly weapons for the clans, intending to use his payments to purchase the freedom of his lover Lady Silk, and leave the village. The region's governor tasks the Lion Clan's leader, Gold Lion, with protecting a large shipment of gold that must pass through the village. Gold is betrayed by his lieutenants Silver Lion and Bronze Lion, who plan to steal the gold. They use the chaos ensuing from a fight with the Hyena Clan to allow their co-conspirator Poison Dagger—the governor's aide—to assassinate Gold, after which Silver becomes the Lions' leader. Gold's son Zen-Yi learns of his father's murder and sets off to the village to seek revenge.
Thaddeus is on his way to the monks at Wujiquan Temple on a quest on inner peace when he is attacked by the brother of Silver Lion and his henchmen. Thaddeus manages to defeat them all but receives a near fatal wound from claw of Silver's brother. He succumbs to his wounds and is seen drifting on a log down a river.