Exhibit 10.1

 
PURCHASE AGREEMENT
 
This Purchase Agreement (this “Agreement”) is made as of December 12, 2007 by
and among Lifang Chen (the “Seller”), the purchasers set forth on the signature
pages hereto (each, a “Purchaser” and collectively, the “Purchasers”) and Sutor
Technology Group Limited, a Nevada corporation (the “Company”).
 
WHEREAS, Seller desires to sell certain of her shares of the Company’s common
stock, par value $0.001 per share (the “Common Stock”), to the Purchasers and
the Purchasers’ desire to purchase such shares.
 
WHEREAS, subject to the terms and conditions set forth in this Agreement and
pursuant to Sections 4(1) and 4(2) of the Securities Act of 1933, as amended
(the “Securities Act”), the Seller desires to sell and transfer to each
Purchaser the number of shares of Common Stock set forth on the Purchaser’s
signature page hereto, which such shares of Common Stock were originally issued
to the Seller by the Company (the “Shares”) and each Purchaser desires to
purchase the Shares from the Seller.
 
NOW, THEREFORE, in consideration of the mutual covenants contained in this
Agreement and for other good and valuable consideration the receipt and adequacy
of which are hereby acknowledged, the Seller, the Company and the Purchasers
hereby agree as follows:
 
Section 1. Agreement to Purchase. Each Purchaser hereby agrees to purchase, and
the Seller hereby agrees to sell, the Shares set forth on each such Purchaser’s
signature page pursuant to the conditions set forth herein. The purchase price
per Share being sold to the Purchasers hereunder is $4.25 (the “Purchase
Price”). Of the $4.25 Purchase Price per Share, $0.19125 per Share shall be
payable to Roth Capital Partners, LLC (“Roth”) as a brokerage fee with respect
to the transactions contemplated by this Agreement. Each of Roth and the Seller
shall be paid directly out of the escrow account established for this
transaction in accordance with the flow of funds memorandum attached hereto as
Exhibit A.
 
Section 2. Closing; Delivery.
 
a. The closing under this Agreement shall occur upon delivery of executed
signature pages to this Agreement and all other documents, instruments and
writings required to be delivered pursuant to this Agreement as provided in
Sections 2(b) and 2(c) to the offices of Bryan Cave LLP, 1290 Avenue of the
Americas, New York, NY 10104 (the “Closing”) at 10:00 a.m. (eastern time) on
December 14, 2007 or at such other time and place on such date as the Purchasers
and Seller may agree upon (the “Closing Date”).
 
b. Following the execution of this Agreement, (i) the Seller will deliver to the
Company’s transfer agent (A) the certificate representing the Shares together
with all executed stock power and assignment documents which may be relevant in
order to effectuate the transfer of the Shares to the Purchasers and (B) an
opinion of counsel reasonably acceptable and addressed to the Company that the
sale and transfer of the Shares pursuant to this Agreement to the Purchasers
shall not require registration under applicable securities laws and (ii) each
Purchaser will deliver to the Escrow Agent (as defined in that certain Escrow
Agreement, dated as of the date hereof, by and among Roth, Seller and the Escrow
Agent (the “Escrow Agreement”)), for deposit and disbursement in accordance with
the Escrow Agreement, by wire transfer of immediately available funds to such
accounts as designated by the Escrow Agent, a United States dollar amount equal
to the product of the Purchase Price multiplied by the number of Shares set
forth on such Purchaser’s signature page hereto.
 
 
 

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c. At the Closing, (i) the Seller will deliver, or cause to be delivered, to
each Purchaser a facsimile copy of the certificate (in each case duly executed
and dated by the Company) representing the Shares being purchased by such
Purchaser in the name of each such Purchaser and (ii) the Escrow Agent will
deliver to the Seller, by wire transfer of immediately available funds to such
accounts as designated by the Seller, a United States dollar amount equal to the
product of the Purchase Price (minus fees payable to Roth in accordance with
Section 1), multiplied by the aggregate number of Shares sold to Purchasers
hereunder (the “Sale Amount”).
 
Section 3. Representations and Warranties of each Purchaser. Each Purchaser,
severally and not jointly, hereby represents and warrants to the Seller as
follows:
 
a. Intent. Such Purchaser is acquiring the Shares as principal for its own
account and not with a current view to or for distributing or reselling such
Shares, without prejudice, however, to such Purchaser’s right, at all times, to
sell or otherwise dispose of all or any part of such Shares pursuant to an
effective registration statement under the Securities Act or under an exemption
from such registration and in compliance with applicable federal and state
securities laws. Nothing contained herein shall be deemed a representation or
warranty by any Purchaser to hold the Shares for any period of time. Such
Purchaser is acquiring the Shares hereunder in the ordinary course of its
business and does not have any agreement or understanding, directly or
indirectly, with any person to distribute any of the Shares.
 
b. Organization; Authority. Such Purchaser is an entity duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization with the requisite partnership power and authority to enter into
and to consummate the transactions contemplated hereby and otherwise to carry
out its obligations hereunder. The purchase by each such Purchaser of the Shares
hereunder has been duly authorized by all necessary action on the part of such
Purchaser. This Agreement has been duly executed by each such Purchaser, and
when delivered by such Purchaser in accordance with the terms hereof, will
constitute the valid and legally binding obligation of such Purchaser,
enforceable against it in accordance with its terms, subject to applicable
bankruptcy, reorganization, insolvency, moratorium or similar laws affecting
creditors’ rights generally.
 
c. Purchaser Status. Such Purchaser is an “accredited investor” as defined in
Rule 501(a) under the Securities Act. Such Purchaser is not a registered
broker-dealer under Section 15 of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”).
 
d. Experience of such Purchaser. Such Purchaser, either alone or together with
its representatives, has such knowledge, sophistication and experience in
business and financial matters so as to be capable of evaluating the merits and
risks of the prospective investment in the Shares, and has so evaluated the
merits and risks of such investment. Such Purchaser is able to bear the economic
risk of an investment in the Shares and, at the present time, is able to afford
a complete loss of such investment.
 
 
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e. General Solicitation. Such Purchaser is not purchasing the Shares as a result
of any advertisement, article, notice or other communication regarding the
Shares published in any newspaper, magazine or similar media or broadcast over
television or radio or presented at any seminar or any other general
solicitation or general advertisement.
 
f. Independent Investment Decision. Such Purchaser has independently evaluated
the merits of its decision to purchase the Shares pursuant to this Agreement,
and such Purchaser confirms that it has not relied on the advice of any other
Purchaser’s business and/or legal counsel in making such decision. Such
Purchaser has not relied on the business or legal advice of Roth Capital
Partners, LLC or any of its agents, counsel or Affiliates (as defined below) in
making its investment decision hereunder, and confirms that none of such persons
has made any representations or warranties to Purchaser in connection with the
transactions contemplated by this Agreement.
 
g. Non-Public Information. Such Purchaser acknowledges that the Seller may have
non-public information (which may or may not be relevant to such Purchaser’s
consideration of an investment in the Shares) with respect to the Company which
each Purchaser agrees need not be provided to him or her.
 
h. Restricted Securities. Such Purchaser acknowledges that the Shares are
“restricted securities” as defined in Rule 144 under the Securities Act.
 
Section 4. Representations and Warranties of the Company. The Company hereby
represents and warrants to each Purchaser as follows:
 
a. Authority. This Agreement has been duly executed by the Company, and when
delivered by the Company in accordance with the terms hereof, will constitute
the valid and legally binding obligation of the Company, enforceable against it
in accordance with its terms, subject to applicable bankruptcy, reorganization,
insolvency, moratorium or similar laws affecting creditors’ rights generally.
 
Section 5. Representations and Warranties of the Seller. The Seller hereby
represents and warrants to each Purchaser as follows:
 
a. Power and Authority. Such Seller has full authority and power to execute and
deliver this Agreement and subject in part to the truthfulness of Purchasers’
representations herein, to sell and transfer the Shares to the Purchasers as
provided herein. This Agreement has been duly executed and delivered by such
Seller and constitutes the valid and binding obligation of such Seller
enforceable against such Seller in accordance with its respective terms, subject
to applicable bankruptcy, reorganization, insolvency, moratorium or similar laws
affecting creditors’ rights generally.
 
 
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b. Ownership. Seller is the sole and exclusive owner, beneficially and of
record, of the Shares, free and clear of any lien, encumbrance or pledge and,
except for restrictions on transfer imposed by applicable securities laws, has
the unconditional right to sell the Shares as contemplated by this Agreement. At
the Closing, upon payment of the Purchase Price, the Purchasers will acquire all
right, title and interest in the Shares, free and clear of any lien, encumbrance
or pledge other than restrictions on transfer in accordance with applicable
securities laws. Such Seller has held the Shares continuously since the date
such Shares were issued by the Company. Such Seller is not aware of any third
party claims with respect to the Shares.
 
c. Solicitation. At no time did such Seller present or solicit, by means of any
publicly issued or circulated newspaper, mail, radio, television or other form
of general advertising or solicitation, in connection with the offer, sale and
purchase of the Shares.
 
d. No Conflicts. The execution and delivery of this Agreement and the
performance of its respective terms will not, with or without the giving of
notice or the passage of time, conflict with, constitute a violation or breach
of or result in a default under, result in the acceleration of, create in any
party the right to accelerate, terminate, modify, or cancel or require any
notice or consent under (a) any contract, security interest, or other
arrangement to which such Seller is a party or by which such Seller or its
property is bound or to which any of such Seller’s assets are subject, (b) any
order, writ, injunction, award, decree, decision or ruling of any court,
arbitrator or governmental or regulatory body against or binding such Seller or
its property, or (c) any statute, law, rule or regulation of any jurisdiction to
which Seller or its property may be subject.
 
Section 6. Certain Obligations of the Parties. The Seller covenants and agrees
to provide to the Purchasers and the Company any and all documents which may be
reasonably required in order to effectuate the transactions contemplated by this
Agreement, including, without limitation, the opinion of counsel referenced in
Section 2 above. The Company will use its reasonable best efforts to prepare and
file with the Securities and Exchange Commission a registration statement,
including the prospectus, for an offering to be made on a continuous basis
pursuant to Rule 415 of the Securities Act, on Form S-3 (or on such other form
appropriate for such purpose) (collectively, the “Registration Statement”) by
the 45th day following the Closing Date covering the resale by the Purchasers of
the Shares and naming the Purchasers as Selling Stockholders therein. The
Company will use its reasonable best efforts to cause the Registration Statement
be declared effective under the Securities Act as soon as possible but, in any
event, no later than 120 days following the Closing Date, and shall use its
reasonable best efforts to keep the Registration Statement continuously
effective during the entire Effectiveness Period. For purposes hereof,
“Effectiveness Period” shall mean the period commencing on the date on which the
Registration Statement is first declared effective by the Securities and
Exchange Commission (the “Effective Date”) and ending on the earliest to occur
of (a) the second anniversary of such Effective Date, (b) such time as all of
the Shares covered by the Registration Statement have been publicly sold by the
Purchasers pursuant to the Registration Statement, or (c) such time as all of
the Shares covered by the Registration Statement may be sold by the Purchasers
without volume restrictions pursuant to Rule 144 of the Securities Act, in each
case as determined by the counsel to the Company pursuant to a written opinion
letter to such effect, addressed and acceptable to the Company's transfer agent
and the affected Purchasers. Each Purchaser covenants and agrees that it will
comply with the prospectus delivery requirements of the Securities Act as
applicable to it in connection with sales of Shares pursuant to the Registration
Statement. Each Purchaser covenants and agrees that it will comply with federal
and state securities laws applicable to it in connection with sales of Shares
pursuant to the Registration Statement.
 
 
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Section 7. Conditions Precedent to the Obligation of the Seller to Sell the
Shares on the Closing Date. The obligation hereunder of the Seller to sell the
Shares to the Purchasers is subject to the satisfaction or waiver, on or before
the Closing, of each of the conditions set forth below.
 
a. This Agreement shall have been executed by the Purchasers and the Company and
delivered to the Seller;
 
b. The representations and warranties of each Purchaser shall be true and
correct in all material respects as of the date when made and as of the Closing
Date; and
 
c. No statute, regulation, executive order, decree, ruling or injunction shall
have been enacted, entered, promulgated or endorsed by any court or governmental
authority of competent jurisdiction which prohibits the consummation of any of
the transactions contemplated by this Agreement.
 
Section 8. Conditions Precedent to the Obligation of each Purchaser to Purchase
the Shares on the Closing Date. The obligation hereunder of each Purchaser to
purchase the Shares from the Seller is subject to the satisfaction or waiver, on
or before the Closing, of each of the conditions set forth below.
 
a. This Agreement shall have been executed by the Seller and the Company and
delivered to each Purchaser;
 
b. The representations and warranties of the Seller and the Company shall be
true and correct in all material respects as of the date when made and as of the
Closing Date;
 
c. No statute, regulation, executive order, decree, ruling or injunction shall
have been enacted, entered, promulgated or endorsed by any court or governmental
authority of competent jurisdiction which prohibits the consummation of any of
the transactions contemplated by this Agreement; and
 
d. The Seller and the Company shall have performed, satisfied and complied in
all material respects with all covenants, agreements and conditions required by
this Agreement to be performed, satisfied or complied with by it at or prior to
the Closing.
 
Section 9.  Indemnification.
 
a. The Seller hereby agrees to indemnify and hold harmless each Purchaser and
its respective officers, directors, shareholders, employees, agents and
attorneys against any and all losses, claims, damages, liabilities and expenses
incurred by each such person insofar as such losses, claims, demands,
liabilities and expenses arise out of or are based upon any breach of any
representation, warranty or agreement made by the Seller in this Agreement;
provided, however, in no event shall the maximum aggregate liability of the
Seller to each Purchaser pursuant to this Section 9 be in excess of the product
of the Purchase Price (minus fees payable to Roth in accordance with Section 1)
multiplied by the aggregate number of Shares purchased by such Purchaser
hereunder.
 
 
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b. The Seller hereby agrees to indemnify and hold harmless the Company and its
respective officers, directors, shareholders, employees, agents and attorneys
against any and all losses, claims, damages, liabilities and expenses incurred
by each such person insofar as such losses, claims, demands, liabilities and
expenses arise out of or are based upon (i) any breach of any representation,
warranty or agreement made by the Seller in this Agreement; (ii) any violation
or alleged violation by the Seller of the Securities Act, Exchange Act or any
state securities law or any rule or regulation thereunder, in connection with
the performance of her obligations under this Agreement; or (3) any untrue or
alleged untrue statement of a material fact made by the Seller in the
Registration Statement or in any amendment or supplement thereto, or arising out
of or relating to any of the Seller’s omission or alleged omission to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading, provided, however, in no event shall the maximum
aggregate liability of the Seller to the Company pursuant to this Section 9 be
in excess of the Sale Amount.
 
c. Each Purchaser, severally and not jointly, hereby agrees to indemnify and
hold harmless the Seller and her agents and attorneys against any and all
losses, claims, damages, liabilities and expenses incurred by each such person
insofar as such losses, claims, demands, liabilities and expenses arise out of
or are based upon any breach of any representation, warranty or agreement made
by such Purchaser in this Agreement; provided, however, in no event shall the
maximum aggregate liability of such Purchaser to the Seller pursuant to this
Section 9 be in excess of the product of the Purchase Price (minus fees payable
to Roth in accordance with Section 1) multiplied by the aggregate number of
Shares purchased by such Purchaser hereunder.
 
Section 10. Entire Agreement. This Agreement contains the entire understanding
of the parties with respect to the subject matter hereof and supersedes all
prior agreements and understandings, oral or written, with respect to such
matters. This Agreement may not be amended or any provision hereof waived in
whole or in part, except by a written instrument signed by the parties hereto.
 
Section 11. Governing Law. This Agreement shall be governed and interpreted in
accordance with the internal laws of the State of New York, without regard to
the principles of conflicts of law thereof. Each party agrees that all legal
proceedings concerning the interpretations, enforcement and defense of the
transactions contemplated by this Agreement (each, a “Proceeding”) shall be
commenced exclusively in the state and federal courts sitting in the City of New
York, Borough of Manhattan (the “New York Courts”). Each party hereby
irrevocably submits to the exclusive jurisdiction of the New York Courts for the
adjudication of all Proceedings, and hereby irrevocably waives, and agrees not
to assert in any Proceeding, any claim that it is not personally subject to the
jurisdiction of any New York Court, or that any such New York Court is an
inconvenient or improper forum for such Proceeding. Each party hereby
irrevocably waives personal service of process and consents to process being
served in any Proceeding by mailing a copy thereof via registered or certified
mail or overnight delivery (with evidence of delivery) to such party at the
address set forth on the signature page hereto and agrees that such service
shall constitute good and sufficient service of process and notice thereof.
Nothing contained herein shall be deemed to limit in any way any right to serve
process in any manner permitted by law. Each party hereby irrevocably waives, to
the fullest extent permitted by applicable law, any and all right to trial by
jury in any Proceeding. If there shall be commenced a Proceeding, then the
prevailing party in such Proceeding shall be reimbursed by the adverse party or
parties for its reasonable attorneys fees and other expenses incurred in
connection therewith.
 
 
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Section 12. Execution. This Agreement may be executed in two or more
counterparts, all of which when taken together shall be considered one and the
same agreement and shall become effective when counterparts have been signed by
each party and delivered to the other parties, it being understood that all
parties need not sign the same counterpart. In the event that any signature is
delivered by facsimile transmission, such signature shall create a valid and
binding obligation of the party executing (or on whose behalf such signature is
executed) the same with the same force and effect as if such facsimile signature
page were an original thereof.
 
Section 13. The Company’s Expenses. All fees and expenses incident to the
Company’s performance of or compliance with its obligations under this Agreement
shall be borne by the Seller.
 

 
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGE TO FOLLOW]
 
 
 

 
 
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized signatories as of the date first
indicated above.

 
SELLER
 
________________________________________
Lifang Chen

Address: c/o Sutor Technology Group Limited
  No. 8, Huaye Road, Dongbang Industrial Park
  Changshu, China, 215534 
 
Facsimile: 86-512-52687771
 
 
PURCHASER
 
________________________________________
 
By:_____________________________________
Name:
Title:
 
Address: 

Facsimile:
Attn:
 
Number of Shares being purchased:_____________
 
SUTOR TECHNOLOGY GROUP LIMITED
(FOR THE PURPOSE OF SECTIONS 4, 6, 9(b), 
10, 11, 12 AND 13 ONLY)
 
By:_____________________________________
Name:
Title:
 
Address: No. 8, Huaye Road, Dongbang Industrial Park
 Changshu, China, 215534 

Facsimile: 86-512-52687771
Attn: Chief Executive Officer