Document:

Letter Agreement

 

 

 

December 14, 2012

 

By Hand Delivery

Naijiang Zhou

 

Dear Mr. Zhou:

 

The purpose of this
letter agreement (the “Agreement”) is to confirm your employment arrangement with SUTOR STEEL TECHNOLOGY CO., LTD.
(the “Company”), on the following terms and conditions:

 

1. Duties. You
will be employed as the Chief Financial Officer, subject to the supervision of the board of directors. Your duties will include
but not be limited to, supervise the financial management of the company, improve the cash utilizing efficiency, reduce financial
cost. You shall devote your entire business time, energies, attention and abilities to the business of Company unless otherwise
authorized by the board of directors. During your employment by Company, you shall not engage in any activity or have any business
interest which in any manner interferes with the proper performance of your duties, conflicts with the interest of Company or brings
into disrepute the business reputation of Company.

 

2. Salary. Your
salary will be 696,000 in Renminbi (approximately 111,360 USD) per year, to be paid in monthly installments or otherwise in accordance
with Company’s normal payroll practices. You shall also be entitled to receive 50,000 restricted shares of the common stock
of Sutor Technology Group Limited (“Sutor”) pursuant to Sutor’s 2009 Equity Incentive Plan. The restricted shares
grant shall be evidenced by the standard restricted shares grant agreement under Sutor’s 2009 Equity Incentive Plan (the
“Restricted Shares Agreement”) and the restricted shares will be subject to the terms and conditions of such Restricted
Shares Agreement.

 

3.   
 Bonus. You shall be eligible for a bonus, which will be payable in the sole discretion of Company based upon your
performance and the Company’s performance during any year of your employment with the Company.

 

4.   
Term of Employment. Your term of employment will be one year. After one year, this employment shall be renewed automatically
unless terminated or modified. Either you or Company may end your employment at any time, with or without cause, and with or without
notice.

 

5.   
Vacation. You shall be entitled to 24 paid vacation days. You may not take more than 32 vacation days consecutively.
Vacation days will not be carried over to future years of employment.

 

    	 

    	 	

    
 

6.   
Incentive and Other Plans. You will be entitled to participate in such pension, major medical, life insurance and
other plans and benefit programs as may be made available from time to time to employees of Company having responsibilities comparable
to yours and under the terms of which you are eligible to participate.

 

7. Company Policies.
You shall at all times be subject to and comply with policies, rules and procedures of Company then in effect, including without
limitation with respect to hours of work, holidays, vacation and sick leave and pay, conflict of interest, improper payments, political
contributions and payments to government officials.

 

8. Patents. You
hereby assign to Company all rights to any inventions, techniques, processes, concepts, ideas, programs, source codes, formulae,
research and development and marketing plans, whether or not patentable or copyrightable, made, conceived or reduced to practice
by you during the course of your employment by Company.

 

9. Covenants.
During your employment by Company and at all times thereafter, you shall not (a) disrupt, disparage, impair or interfere with the
business of Company or (b) disclose to anyone else, directly or indirectly, any proprietary or business sensitive information concerning
the business of Company or use, or permit or assist, by acquiescence or otherwise, anyone else to use, directly or indirectly,
any such information. Such information shall include all information to the extent not generally known to the public which, if
released to unauthorized persons, could be detrimental to the reputation or business interests of Company or parties with which
Company contracts or which would permit such person to benefit improperly.

 

10. Company Property.
Upon termination of your employment for any reason, you shall promptly deliver to Company all property belonging to Company and
shall not retain any copies of any correspondence, reports, lists or other documents relating in any way to the affairs of Company
or its clients.

 

11. Non-Solicitation.
During the term of your employment by Company and for a period of twelve months following the termination of your employment, whether
voluntary or involuntary, you shall not, directly or indirectly:

 

(a) solicit customers
or business patronage which results in competition with the business of Company or any of its affiliates, or

 

(b) approach or attempt
to induce any person who is then in the employ of Company to leave the employ of Company or employ or attempt to employ any person
who was in the employ of Company at any time during the prior twelve months.

 

12. Notices.
All notices hereunder shall be to the parties’ addresses set forth above for the Company and on the Signature Page for you,
in writing and given by registered or certified mail, return receipt requested, postage and registration fees prepaid, and shall
be deemed given when so mailed. The addresses set forth herein may be changed by notice given in the manner set forth in this Section.

 

    	 

    	 	

    
 

13.  Miscellaneous. This Agreement (a) shall be governed by, and construed in accordance with, the laws of the British
Virgin Islands, without regard for the conflict of laws principles thereof, (b) shall inure to the benefit of, and shall be binding
upon, the parties hereto and their respective heirs, legal representatives and assigns, (c) may not be changed orally but only
by an agreement in writing signed by the party against whom any waiver, change, amendment, notification or discharge is sought,
and (d) contains the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior
agreements, oral or written, between the parties hereto. For the avoidance of doubt, each of the Employment Contract, Amendment
to the Employment Contract, and Amendment No. 2 to the Employment Contract, by and between you and Sutor, dated December 18, 2009,
February 23, 1011 and February 9, 2012, respectively, shall be terminated, except that the 50,000 restricted shares of Sutor granted
under Section 4.1(b) of the Employment Contract, as amended, shall continue to be vested according to certain Restricted Shares
Grant Agreement, dated February 21, 2012, by and between you and Sutor. The invalidity of all or any part of any section of this
Agreement shall not render invalid the remainder of this Agreement. If any provision of this Agreement is so broad as to be unenforceable,
such provision shall be interpreted to be only so broad as is enforceable.

 

SUTOR STEEL
TECHNOLOGY CO., LTD.

 

By: /s/
Lifang Chen                                        

Name: Lifang
Chen

Title: Chairman

 

Solely with respect to Sections
2 and 13 herein:

 

SUTOR TECHNOLOGY
GROUP LIMITED

 

By: /s/
Lifang Chen                                         

Name: Lifang
Chen

Title: Chief
Executive Officer

 

ACCEPTED AND AGREED TO

AS OF THE DATE FIRST ABOVE

WRITTEN:

 

/s/ Naijiang Zhou                      

Naijiang ZhouEXHIBIT 10.4

                                LEASING CONTRACT

PARTICULAR CONDITIONS

In Benalmadena June 2, 2010

IDENTIFICATION AND DELEGATION OF THE PARTIES

Financial Institution:     Banco Popular Espanol S.A.

Tax Identification Number: A28000727

Address:                   C/ Velazquez, 34, esquina Goya 35, MADRID

                           0953 - 53 BENALMADENA

Company's House of Madrid inscription - Book 174, page 44, entry 1st. Registered
in the Bank of Spain Registry number 0075.

Represented by its proxies Mrs.  MONICA  DESCALZO  MARTIN with ID 012326297E and
Mr. SANTIAGO HERVES GARRIDO, with ID 029751503Z;

As per power of attorneys  signed  before the Notary of Madrid Mr. HUERTA TROLEZ
ANTONIO;

Financial Lessee (hereafter, the Client)

First surname             Second surname              Name(or Company's name)
-------------             --------------              -----------------------
XYZ                           ABC                        ARROW CARS S.L.

Tax Id:                   B-92914282

Address:                  AV. MIJAS 1 (OFICINA 1) 29630 BENALMADENA COSTA,
                          MALAGA

Company's House Malaga:   Book 4467, volume 3376, page 88, entry 1st.

Represented by his proxy: Mr. JEREMY DEAN HARRIS, with ID number X-3570493-L;
                          MRS. AMELIA MARIN GARCIA;

Dated:                    2010-01-13 and number 76 of her registry.

TERM

This leasing contract has a term of 60 months  commencing today. The duration of
the term is irrevocable.

IDENTIFICATION OF THE GOODS SUBJECT OF THIS CONTRACT

DESCRIPTION:

Brand: XZY                      Model: ABC                    Registration: DDTF

Serial number: 1234             Chassis number: 1234          Price: 1234
<PAGE>
Supplier: SAFAOCASION S.L.

Tax Id.   B-92523993

Address:  Avenida de las Gaviotas, n(0)1.

Place of storage of the goods: AV. MIJAS 1 (OFICINA 1) 29630 BENALMADENA  COSTA.
                               MALAGA.

PRICE & FORM OF PAYMENT

The total amount to be paid by the Client,  including the financial  charges and
taxes is, at the signing of this contract:  1234 Euros,  and will be distributed
in the payments and amounts  specified in the Schedule of payments,  where it is
also expressed,  that every payment will include repayment of the amount lent by
the Lessor, interests and taxes.

FINANCIAL DATA OF THE CONTRACT

Investment:                                 Residual value:

Indirect Tax:                               Nominal Annual Interest Rate: 4.243%

Identification of index reference*          Constant margin:*

Opening commission: 0.00%                   Study commission: 0,00 euros (i)

Cash deposit: **0 EUR

APR: 4.3270% (Including cash deposits & commissions)

Nominal annual penalty interest rate: 29%
                                      Amount of the initial payment. 0.00 EUR
                                      (i)Calculated over: (Investment)

----------
*    ONLY FOR VARIABLE INTERESTS CONTRACTS.
**   CASH DEPOSIT WILL BE REFUNDED WHEN THE CONTRACT EXPIRES.

EXPLANATION OF FINANCIAL DATA

1. FORMULA TO CALCULATE THE ANNUAL PERCENTAGE RATE (APR)

In order to  calculate  the APR, it will be applied the system set in Annex V of
the Circular  8/1990 of Bank of Spain of 7th of September,  which content it has
been modified by Circular  22/1992 of Bank of Spain of 19th of December,  by the
Circular 13/1993 of Bank of Spain of 21st of December, by the Circular 5/1994 of
Bank of Spain of 22nd of July and by the Circular of 27th of February.

2. FORMULA TO CALCULATE THE INITIAL ORDINARY INTERESTS

     R= (C-(OC*(1+i)(-n)))*i/(1-(1+i)(-n)*(1+i)

     Being: R  = Periodic rent

            C  = Cost of good (taxes not included)

            I  = Effective interest rate for period

                                       2
<PAGE>
            N  =  Number of payments (excluding OC)

            OC = Option to purchase

3. FORMULA TO CALCULATE THE REVISION OF ORDINARY INTERESTS

As in number 2, taking into  account  that the cost of good will be equal to the
balance outstanding on the revision date.

4. FORMULA TO CALCULATE PENALTY INTERESTS

     ID = C * R * T/36000

     C  = Unpaid amount;

     R  = Annual Nominal Rate of the penalty interest;

     T  = Number of days since the payment was due until the day of settlement
         of the payment.

     ID = Penalty interests.

5.  Commissions  included  in the APR.- The  commissions  taken into  account to
calculate the APR are the ones expressed in number 1 above and have been charged
the day this contract was signed.

6. Other  commissions to be paid by the client.- It is expressly stated that, in
case of early  cancellation of this contract by the lessee, the financial lessor
will be entitled  to receive a  commission  of a maximum of 210,35  Euros of the
outstanding  capital as per the schedule of payments attached to this particular
conditions. Also, it will be paid by the client the other commissions that, when
the facts that cause them occur,  will have been published and  communicated  to
the Bank of Spain by the financial lessor.  Copy of which is given to the Client
now.

OTHER PARTICULAR CONDITIONS

6.1. Address of the Financial Lessor for request and for certified  notice:  AV.
CONSTITUCION 37 (ED GAVILAN, LOCAL 1 BENALMADENA).

6.2. Address of the Financial Lessor for recovery of goods: AV.  CONSTITUCION 37
(ED GAVILAN, LOCAL 1 BENALMADENA).

6.3.  Cession of contracts by the Financial  Lessor:  The  Financial  Lessor can
yield the goods  subject of this  contract  and the  contract to third  parties,
being obliged to notify it by certified post to the client, and, in case, to the
guarantor.  The third acquiring  party will replace the Financial  Lessor in its
position  and will be obliged to respect  the Client  rights,  specially,  those
related to the review of the interest  rate,  if the same was agreed,  and those
related to the length of the  contract,  the  purchase  option and the  residual
value agreed as price for the case the option will be  executed.  The cession of
the contract will not affect the guarantor.

                                       3
<PAGE>
6.4.  Online  registration  of the contract  authorization:  The parties of this
contract  authorize  to the  Financial  Lessor to registry  with the Registry of
Moveable  Goods.  The exact  correspondence  between this  contract and the file
registered  in  the  above  mentioned  Registry  will  be the  Financial  Lessor
responsibility.

6.5.  Automated  treatment of Personal Data:  Accordingly with article n(0) 5 of
the Spanish Data Protection Law 15/1999 (LOPD),  the Financial  Lessor inform to
the parties of this  contract  that the personal data used during the process of
this file and  related  data that could be obtained  from the public  registries
will  be  incorporated  into a data  base  related  to  the  development  of the
contractual relationship, including the transfer of such data, in case of breach
of  contract,   to  data  bases  related  to  credit  rating  and  breaching  of
obligations.  The data base will be used internally by the Financial  Lessor and
the companies of its group with the purpose of offering financial, insurance and
investment services.

The  Financial  Lessor is  responsible  of the data base and the use of it.  The
people entitled to it, can make use before the Financial  Lessor of their rights
of access,  rectification,  cancelation and opposition  given by the Organic Law
and  related  development  Laws,  through  document  sent to the  address of the
Financial Lessor or through email sent to atencionaclientes@bancopopular.es.

The  owner  of the data  permit  expressly  the  collection  of the  data  above
described its treatment and any communication or transfer of the above mentioned
data between the Financial Lessor and the other companies of its group, with the
purpose  and  activities  mentioned.  The  companies  of the group will be those
mentioned in the web site www.bancopopular.es

The signing  parties of this contract do not accept the transfer of data for any
other purpose not directly  related with the development and fulfillment of this
contract:
--------------------------------------------------------------------------------

6.6. Nevertheless, what agreed in Particular Condition n(0) 9, it is agreed that
the nominal minimum Interest rate applicable to this contract will be 0,000 %.

6.7. In case this contract  will be registered in the Registry of Chattels,  the
Client will pay all the costs related and any later changes and its cancellation
in the  mentioned  registry.  Also will be paid by the  Client  the costs of the
Notary.  The  Financial  Lessor  will  charge  the Lessee the costs of the post.
Transport  and  installation  of the goods of this  contract will be paid by the
client if the supplier do not pay for them. All the above without prejudice what
it is set in General Condition 12 "Costs and Taxes" of this contract.

                                       4
<PAGE>
OWNERSHIP OF THE GOODS, PURCHASE OPTION AND RESIDUAL VALUE

a) The goods of this contract are owned by the Financial Lessor.  Except express
contrary  authorization  the client will not  transfer  the use of them to third
parties nor totally neither partially.

The  client  will show his  condition  of user of the  goods to any third  party
intending  to attach a lien and will not be allowed to include it in the process
of administration or bankruptcy.  The parties of this contract agree to register
this contract in the  appropriate  section of the Registry of Chattels,  in case
any of them decide it.

The  Financial  Lessor and the client  agree that the  vehicles  subject of this
contract will be registered at the Spanish  Department of Motor  Vehicles on the
client's name, expressing the right of the Financial Lessor over the cars.

b) Option to  purchase.  The  Financial  Lessor  gives the  client the option to
purchase,  free,  in order to acquire the goods at the end of the length of this
contract, if the client has fulfilled all his obligations. If the client decides
to execute the option,  will have to notify the  Financial  Lessor within the 30
previous  days to de end of the  period  of use of the  goods.  The price of the
purchase is the residual  value set in this clause and reflected in the schedule
of payments, increased with the indirect tax applicable.

c) It is not allowed to the client to sell or give up the option to purchase.

d) In case the option to purchase will be executed,  its price or residual value
is  ___________  in addition to the indirect  taxes  applicable.  The  mentioned
residual value will have to be paid the following day the period of use expires.

The period of use expires on June 1, 2015.

e) Expiry of the  contract  without  executing  the option to  purchase.  If the
client  does not  execute  the  option to  purchase,  will have to return to the
Financial  Lessor the goods at the end of the period of use,  or will be obliged
to pay an amount  equal to double of the last payment for every month or part of
the month that the client keep the possession, except in case both parties agree
to sign a new contract.

                                       5
<PAGE>
DIRECT DEBIT

The monthly payments will be made in the following bank account:

BANK: 0075

OFFICE: 0**3 D.C.: 64 ACCOUNT NUMBER: 06**21*57*.

This bank  account has been  designated  by the client.  The account  number for
payments cannot be changed without the Financial Lessor knowledge,  in case this
happen the client will be liable for any damages caused.

CHANGE OF THE INTEREST RATE DURING LIFE OF THE CONTRACT

This clause will only be valid on contracts  agreed at variable  interest  rate.
The maximum  vary of the  interest  rate  detrimental  to third  parties will be
24.76% in relation  to the nominal  interest  rate set in  Particular  Condition
number 5.

GENERAL CONDITIONS

1. CONTRACT NATURE

This is a  mercantile  contract is defined in the  Additional  Clause of the Law
26/1998 and also article 1255 of the Civil Code.

2. SUBJECT OF THIS CONTRACT

The goods subject of this  contract  have been acquired by the Financial  Lessor
with  the  sole  purpose  of  ceding  its  use  to  the  client,  following  the
specifications and election made by him, establishing the kind, brand, model and
conditions  of the product,  having  chosen the  supplier.  Hence the  Financial
Lessor do not take any  responsibility in the delivery or how it works, but give
the client all the rights in relation to the supplier or  manufacturer.  In case
the client decides  cancelling the purchase he will notify 15 days in advance to
the Financial Lessor.

                                       6
<PAGE>
3. CESSION OF THE GOODS AND PAYMENT OF THE PRICE OF THE CONTRACT

The Financial  Lessor  grants the client the use of the goods  identified in the
particular conditions.  The client accepts the cession and commits to return the
goods at the end of the period of this  contract.  The payments  will be made by
the client as per the schedule of payments attached.

4. INSTALLATION, USE AND DESTINY OF THE GOODS

The  costs of  transport,  installation  etc...  of the  goods  subject  of this
contract not  included in the price will be paid by the client.  The client will
maintain  and  repair  the  goods.  The  client  will be  obliged  to notify the
Financial  Lessor  the  location  of the  goods,  except  in case  they  will be
vehicles.  By Law, the goods will be affected to normal  commercial  activity of
the client.

5. INSURANCE

The insurance of the goods,  third party  liability,  damages and losses will be
paid by the client. The client is obliged to:

5.1. Insure the goods for a minimum value to the  outstanding  amount as per the
schedule of payments,  being the  Financial  Lessor the  beneficiary  in case of
accident.  Length of the  Insurance  will have to be equal to the length of this
contract.  The client will be diligent  dealing  with the  administrative  tasks
related to accidents and he will be liable of damages caused by his  negligence.
In case of an  accident  that damage  partially  the car the client will pay the
difference between the insurance compensation and the total price of the repairs
if the insurance  compensation  does not cover the full amount. In case of total
loss the client  will cover the  repayment  of the  outstanding  payments if the
compensation of the insurance was not enough.  If the  compensation is more than
enough the client will retain the excess.

5.2.  Insure the third party  liability,  and especially to contract and pay the
compulsory car insurance.

6. BREACHING OF CONTRACT BY THE CLIENT

6.1.  Accordingly  to  art.  1124  of the  Spanish  Civil  Code,  breaching  the
conditions  of the  present  contract  is cause  of  cancellation  of the  same.
Specially are considered cancellation causes:

     a)   Lack of payment of any of the scheduled payments.

     b)   Lack of payment of taxes related to this contract.

                                       7
<PAGE>
6.2. In the previous cases the Financial Lessor will,  according to art. 1124 of
the Civil Code:

     a)   Demand the  payment of all the  payments  included in the length f the
          contract,  demanding  through the courts the unpaid  installments  and
          those  outstanding,  plus the penalty  payments and 20% of the amounts
          outstanding,  as penalty,  plus the indirect tax. In this case and for
          the purpose of the  judicial  claim it is agreed that the amount to be
          claimed  will  be  calculated  in  relation  to  what it is set in the
          schedule  of  payments.  If as a  consequence  of the Court  claim the
          client  would  settle in full the debt,  the client  will  execute the
          option to purchase and acquire the good paying the residual value.

     b)   Cancel the lease,  demanding the immediate return of the goods subject
          of the same and also the payment of the outstanding installments,  the
          penalty interests and as a penalty:

          i.   The amount corresponding to the last past installment,  excluding
               taxes,  for each full month or fraction since the cancellation of
               the contract until the goods are returned in full.

          ii.  No more than 10% of the outstanding installments.

6.3. The Financial  Lessor can, in case lack of payment of 2 installments of the
contract  execute the action verbal summary for cancellation of the contract and
recovery of the goods subject of the contract, after previous certified claim to
the  lessee  or the  guarantor.  This  action  can be  taken  together  will the
cancellation of the contract.

7. BREACHING OF CONTRACT BY FINANCIAL LESSOR

The client  will be entitled to cancel the  present  contract,  together  with a
compensation  for damages,  if the Financial  Lessor fails in its  obligation of
paying the supplier the purchase price.

8. LATE PAYMENT OF THE CLIENT

The late payment of  installment  by the client will incur in penalty  interests
without  communication  by the  financial  lessor,  as it is  set in  Particular
Condition 5th.

                                       8
<PAGE>
9. PERSONAL GUARANTEES

The  guarantor  guarantees  together  with the  lessee the  obligations  of this
contract.

10. JOINT CONTRACT

If the holders of this  contract were more than one, all of them will be equally
responsible for it.

11. CLIENT AND GUARANTOR INFORMATION DUTY.

Client and guarantor will inform the Financial Lessor of any  circumstance  that
could affect the ownership of the goods subject of this contract. Every year the
client will  provide the  Financial  Lessor his Balance  Sheet and copies of his
corporation  Tax Returns.  Also the client is obliged to provide any information
related to his solvency.

12. COSTS AND TAXES.

Will be paid by the client all the costs  related to this contract and specially
those  related with the option to purchase.  Also the costs and taxes related to
the use of the goods subject of this contract.

13. ADDRESS FOR REQUESTS AND CERTIFIED NOTICE.

For any request or certified  notice both parties  establish as addresses  those
reflected in the  particular  conditions  of this  contract.  Any change in this
contract will have to be notified in writing to the other interested  parties in
this contract.

                                       9

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