8-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of report (Date of earliest event reported): July 9, 2009 (July 3,2009)

EVER-GLORY INTERNATIONAL GROUP, INC.

(Exact name of registrant as specified in Charter)

Florida	000-28806	65-0420146
(State or other jurisdiction of incorporation or organization)	(Commission File No.)	(IRS Employee Identification No.)

100 N. Barranca Ave. #810

West Covina, CA 91791

(Address of Principal Executive Offices)

(626) 839-9116

(Issuer Telephone number)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.

On July 3, 2009, Ever-Glory International Group Apparel Inc., a subsidiary of Ever-Glory International Group, Inc., (“Borrower” or “we”), entered into a one-year revolving line of credit agreement (“Revolving Line of Credit Agreement”) with Bank of Nanjing Co. Ltd. (“Lender”), a PRC Bank, which allows Borrower to borrow up to RMB 40 million (approximately USD 5.9 million) during the period from June 1, 2009 to June 1, 2010.  Borrower is required to apply for each loan when it needs to draw from this revolving line of credit.  Terms of each loan, such as interest rate, use of proceeds and etc, shall be further set out in each individual loan agreement.  The Revolving Line of Credit is guaranteed by Jiangsu Ever-Glory International Group Corporation, an entity controlled by Mr. Kang, our Chief Executive Officer, and Goldenway Nanjing Garment Co., Ltd., pursuant to certain guaranty agreements. We did not pay any fee to Jiangsu Ever-Glory International Group Corporation or Goldenway Nanjing Garment Co., Ltd. for such security.  

As of July 9, 2009, Borrower has not used any credit under this Revolving Line of Credit Agreement. 

The foregoing description of the Revolving Line of Credit Agreement contemplated thereby does not purport to be complete and is qualified in its entirety by reference to the complete text of the Revolving Line of Credit Agreement, Guaranty provided by Jiangsu Ever-Glory International Enterprise Group Co., Ltd, and Guaranty provided by Goldenway Nanjing Garment Co., Ltd., each attached hereto as Exhibit 10.1, 10.2 and 10.3 respectively.

ITEM 2.03 CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT.

See "Item 1.01. Entry into a Material Definitive Agreement," which is incorporated herein by reference.

ITEM 9.01. EXHIBITS.

10.1	Revolving Line of Credit Agreement between Ever-Glory International Group Apparel Inc. and Bank of Nanjing Co. Ltd. dated July 3, 2009;
10.2	Guaranty Agreement between Jiangsu Ever-Glory International Group Corporation and Bank of Nanjing Co. Ltd. dated July 3, 2009;
10.3	Guaranty Agreement between  Goldenway Nanjing Garment Co. Ltd. and Bank of Nanjing Co. Ltd. dated July 3, 2009.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.

(a) FINANCIAL STATEMENTS OF BUSINESS ACQUIRED.

Not applicable.

(b) PRO FORMA FINANCIAL INFORMATION.

Not applicable.

(c) SHELL COMPANY TRANSACTIONS

Not Applicable

(d) EXHIBITS.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	EVER-GLORY INTERNATIONAL GROUP, INC.
Date: July 9, 2009	By:	/s/ Edward Yihua Kang
		Edward Yihua Kang
		Chief Executive Officer

INDEX TO EXHIBITS

Exhibit Number	Description
10.1	Revolving Line of Credit Agreement between Ever-Glory International Group Apparel Inc. and Bank of Nanjing Co. Ltd. dated July 3, 2009;
10.2	Guaranty Agreement between Jiangsu Ever-Glory International Group Corporation and Bank of Nanjing Co. Ltd. dated July 3, 2009;
10.3	Guaranty Agreement between  Goldenway Nanjing Garment Co. Ltd. and Bank of Nanjing Co. Ltd. dated July 3, 2009.

EX-10.1

Ec1

Contract of Maximum Line of Credit

No. A04 1101 0906 0100 028

Party A: International Business Department, Bank of Nanjing Co., Ltd.

Party B: Ever-Glory International Group Apparel Inc.

In order to ensure Party A has its loan paid by Party B to the maximum amount, and to clarify the domain of credit of the guaranty of maximum amount, Party A and Party B have entered into the Contract for mutual observance and joint performance, according to governing laws, regulations and rules, and through negotiation and agreement.

Article 1  Definitions

1.1   Maximum Line of Credit referred to in the Contract is the maximum amount of the credits (including but not limited to such on-or-off balance sheet businesses as a loan, a commitment of loan, an acceptance, a discount cash, a bond buy-back, a business financing, a factor, a letter of credit, a letter of guarantee, an overdraft, an inter-bank lending, a guaranty, etc.) that will be determinated in succession during a given term (i.e. Credit-determination Period). It is the summation of the balances of a credit Party A grants Party B during a given term, including the following two portions of undue balances of credit and due but unpaid balances of credit:

        (1)   Undue balance is the summation of all the credit balances to be paid but not paid because the term of debt-paying has not expired;

        (2)   Due but unpaid balance is the summation of all the credit balances not paid by Party B despite of the expiration of the debt-paying term.

The above-mentioned Maximum Line of Credit does not include a full amount pledge provided by a deposit certificate, national debt, guarantee deposit, Golden Plum Blossom financing product, or a full amount irrevocable guaranty of joint and several liability provided by a financial organization recognized by Party A, or a full amount policy-based credit insurance provided by China Export & Credit Insurance Corporation, or the credit amount guaranteed by other measures which are capable of risk compensation to the full amount and are recognized by Party A.

1.2   Credit-determination Period in the Contract is the period of time when credits occur. The credit of a guaranty of maximum amount is determinated when this Period expires.

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Article 2  The Maximum Line of Credit and the Credit-determination Period

The Maximum Line of Credit under the Contract is RMB40,000,000.00, said Forty Million RMB Yuan. The Credit-determination Period is from June 1, 2009 to June 1, 2010.

During the above-mentioned period of Period, the summation of the credit balances granted to Party B by Party A shall not exceed the Maximum Line of Credit. When some credits are repaid, Party B may apply for the re-use of the repaid portion.

Article 3  The Occurrence of Credit

The above-mentioned Maximum Line of Credit does not mean a public granting of credit by Party A to Party B, and does not constitute any commitment of Party A for Party B.

During the Credit-determination Period and within the Maximum Line of Credit, Party B applies for specific businesses amount by amount based on its fund shortage, and only can use the capital after Party A has audited, ratified, and agreed to its usage. The beginning date of such a business shall be within the Credit-determination Period, but the ending date of such a business shall or shall not be within this Period depending on the specific business contracts, agreements or the applications related to the business. These specific business contracts, agreements or the applications related to the business are all the legal part of the Contract.

Article 4  The Guaranty of Maximum Amount

4.1 To ensure that Party B makes the repayment of the credits occurred in succession during the Credit-determination Period, one or more forms of guaranty are provided to Party A by the following sureties:

(1)   Jiangsu Ever-Glory International Group Corporation and Goldenway Nanjing Garment Co., Ltd. provide the guaranties of maximum amount, and conclude with Party A related Contracts of Guaranty of Maximum Amount at the time when the Contract takes effect; or

  (2)   provides a pledge guarantee of maximum amount, and concludes with Party A a related Contract of Pledge of Maximum Amount at the time when the Contract takes effect; or

(3)   provides the pledge of rights guarantee of maximum amount, and concludes with Party A a related Contract of Pledge of Rights of Maximum Amount at the time when the Contract takes effect.

4.2 For any change to the guaranty under the Contract which went against the credit of Party A, Party B, by notification of Party A, shall provide further guaranty recognized by Party A as required.

Article 5  Remedy for Breach of the Contract

In case of any violation by Party B of laws, regulations, rules, etc. or any stipulations of the Contract, Party A is entitled to execute one or more of the following rights:

2

(1)   to demand Party B rectify its violation within a definite time;

(2)   to demand Party B provide further guaranty recognized by Party A;

(3)   to execute other rights provided by laws, rules, regulations, or stipulations of the Contract.

Article 6  Applicable Laws and Settlement of Disputes

6.1 The Contract is concluded in accordance with the laws of People’s Republic of China, which are applicable to the Contract.

6.2  Any dispute occurred in the course of the execution of the Contract shall be settled through negotiations. In case of no settlement is reached, Type 1 shall be chosen from the following settling manners:

(Type 1)	Bring a lawsuit to the People’s Court at the locality of Party A, or
(Type 2)	Apply to / Arbitration Commission for arbitration (the locality is / ) with the arbitration rules active and effective at the time the application is made. The arbitration decision is final and binding on both parties.

In the course of lawsuit or arbitration, terms and conditions under the Contract which are not involved in the dispute shall still be executed or fulfilled.

Article 7  Effectiveness, Alteration and Periodination of the Contract

7.1  The Contract shall enter into effect on the day when it is signed by or sealed with the name stamp of the legal representative, principle, or authorized representative of Party A and sealed with the Corporate Seal or Special Contract Seal of Party A, and signed by or sealed with the name stamp of the legal representative or authorized representative of Party B and sealed with the Corporate Seal or Special Contract Seal of Party B

7.1 After the Contract enters into effect, neither Party A nor Party B shall arbitrarily alter or terminate it unless further stipulated by the Contract; in the case of needy alteration or termination, a written agreement should be reached by both parties through negotiation. All terms and conditions of the Contract remain effective before such written agreement is reached.

Article 8  Other Stipulations

Not Applicable

Article 9  Supplementary Provisions

9.1 The Contract is made in two copies, one is held by Party B, and one is held by Party A, and each copy has the equal legal force.

9.2 Any matters not covered by the Contract shall be handled in compliance with relevant national laws, regulations and rules.

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Article 10  Miscellaneous

10.1 In signing and exercising the Contract, both parties have been approved by law or have been given the approval by the competent decision-maker stipulated in their respective articles of corporation or by government supervision department, and obtained the necessary, sufficient and legal authorization.

10.2 In signing the Contract, the parties expressed their true intentions, the signatures and seals were genuine, the signing representatives are authorized, and the Contract has legally binding on both parties.

10.3 Party B has the right to own its whole property, and all the documentation it produced to Party A is true, legal and effective, and contains neither mistake nor omission of facts which disagrees with the truth.

10.4 Party B has read all the content of the Contract. As requested by Party B, Party A has made relevant explanation on the terms and conditions of the Contract. Party B has got a full knowledge and understanding of the significations and legal consequences of the stipulations of the Contract.

16.5 Party A is a legally established bank, and is qualified to operate the business under the Contract.

Party A:	Party B:
International Business Department	Ever-Glory International Group Apparel Inc.
Bank of Nanjing Co., ltd.	(Seal)
(Seal)
Legal Representative	Legal Representative
(Principle or Authorized Agent):	(or Authorized Agent):
(Signature)	(Signature)
/s/ Wei Zhang	/s/ Jiajun Sun
Address:	Address:
Post Code:	Post Code:
Contact No.:	Contact No.:
Date of Signing: July 3, 2009	Date of Signing: July 3, 2009

4

EX-10.2

Ec1

Contract of Guaranty

No. Ec1 1101 0906 0100 030

Creditor (Party A): International Business Department, Bank of Nanjing Co., Ltd.

Surety (Party B): Jiangsu Ever-Glory International Group Corporation

In order to ensure the performance of the Contract of Maximum Line of Credit numbered A04 1101 0906 0100 028, which was concluded between Party A and Ever-Glory International Group Apparel Inc. Co., Ltd. (hereinafter called the Debtor), and all specific business contracts, agreements, and applications under this contract (hereinafter called the Principal Contract), Party B is willing to provide the Debtor with a guaranty of guaranty of joint and several liability of maximum amount. In order to clarify their liabilities and keep to their credibility, Party A and Party B have entered into the Contract for common observance and joint performance, according to governing laws, regulations and rules, and through negotiation and agreement.

Article 1  Representations and warranties of Party B

1.1 Party B has the principal qualification of a guarantor, and is capable to provide with a guaranty of courtship, according to the laws of People’s Republic of China.

1.2 Party B is fully capable to undertake the guarantor liability, and such liability may not be alleviated or exempted due to any instruction received, financial situation changes, or any agreement reached with any body.

1.3 Party B has a full knowledge of the usage of the debt of the debtor under the Principal Contract, and Party B provides the debtor a guaranty absolutely at his own will while all of his declaration of will under the Contract is true.

1.4 If being a natural person, Party B confirms and assures that before providing the guaranty of guarantor ship under the Contract, he has made proper arrangement on the bare necessities of life for himself and his family dependents; Party A requires that Party B’s assumption of the guarantor ship liability shall not have any impact on the normal lives of Party B and his family members.

Article 2 The Principal Credit

2.1 The Principal Credit secured under the Contract is the full value of the Principal Credit, namely RMB40,000,000.00, said Forty Million RMB Yuan, formed by specific granting of credit (including but not limited to such on-or-off balance sheet businesses as a loan, a commitment of loan, an acceptance, a discount cash, a bond buy-back, a business financing, a factor, a letter of credit, a letter of guarantee, an overdraft, an inter-bank lending, a guaranty, etc.) conducted by Party A for the Debtor from June 1, 2009 to June 1, 2010, on the basis of the Principal Contract.

2.2 Party B provides a guaranty of maximum amount for the above-mentioned Principal Credit, irrespective of the times and the amount of each time, or whether the expiry date of the time limit for the debtor to perform his obligation overtop the foregoing time limit.

Article 3  Mode of Guaranty

Party B provides a guaranty of joint and several liabilities. Where the debtor either wholly or partly defaults when the time limit for his performance of the obligation of a single debt under the Principal Contract expires, Party A has the right to directly demand Party B to perform his obligation of guaranty.

Article 4  The Scope of the Guaranty

The scope of the guaranty of maximum amount provided by Party B includes the Principal Credit and the interest thereof (including compound interest and default interest, similarly hereinafter), default fine, compensation for damage and expenses of Party A for enforcing the claim (including but not limited to legal cost, arbitration fee, property preservation charge, travel expense, notarial fee, execution fee, attorney fee, eligibility fee, auctioneers fee, etc., and the same below).

Party B confirms and accepts out of his will, that when the Debtor fails to perform his liability stipulated in the Principal Contract, Party A has the right to directly demand Party B to undertake his guaranty liability within the scope of his guaranty guaranty, whether or not the claim of Party A under the Principal Contract is benefited with other guaranty (including but not limited to a guaranty with real rights).

Article 5  Term of the Guaranty

The term of the guaranty is the period of two years from the expiry date of the performance term of the liability caused by each time’s usage by the Debtor of the line of credit under the Principal Contract.

Where an extension agreement was reached between Party A and the Debtor of the performance term of each debt under the Principal Contract, the term of the guaranty is the period of two years from the expiry date of the performance term of a certain debt reappointed by the extension agreement; where Party A withdraws its creditor’s rights ahead of time according to laws, regulations, rules or stipulations in the Principal Contract, the term of the guaranty is the period of two years from the advanced expiry date of the Principal Liability.

Article 6  Conclusion and Alteration of the Principal Contract Guaranteed

Particulars related to specific amount, term, interest, usage, etc. of the Principal Credit, shall be stipulated by Party A and the Debtor in the Principal Contract.

Party B confirms that, except for the increase of line of credit and the extension of term of guaranty, the conclusion of the Principal Contract or the alteration of the Principal Contract through agreement by Party A and the Debtor, are deemed as being agreed in advance by Party B, and need not to be notified to Party B, while the guaranty liability on the part of Party B shall not be alleviated.

Where Party A and the Debtor alter the interest rates in the light of stipulations of the Principal Contract, such alteration shall also be deemed as being agreed in advance by Party B, and needs not to be notified to Party B, while Party B is still obliged to undertake the guaranty liability.

Article 7  Independent Effectiveness of the Contract

The effectiveness of the Contract is independent of the Principal Contract, complete or incomplete invalidity of the Principal Contract or its likely revocation has no impact on the Contract’s effectiveness. Where it is confirmed that the Principal Contract was invalid or that it was revoked, Party B undertakes further guaranty of joint and several liabilities for the Debtor’s debts coming into being because he surrendered properties or compensated losses.

Party B’s guaranty liability under the Contract shall not change to any extent because of merger, separation, changes of shareholdings, the lapse of capacity of civil acts, disappearance, death or the declaration of disappearance or death of the Debtor, or any other causes.

Article 8  Advanced Enforcement of Guaranty Liability

Where Party A declares an advanced expiration of the liability under the Principal Contract according to laws, regulations, rules etc. or stipulations in the Principal Contract, Party A has the right to immediately demand Party B to perform the liability of the guaranty guaranty.

Article 9  Rights and Obligations of Party B

9.1 Party B has the obligation to supervise the guarantee’s performance of all the obligations under the Principal Contract.

9.2 Party B shall actively cooperate with Party A and consciously subject itself to Party A’s inspection and supervision over its business operation and financial activities, and provide Party A every month, as required by Party A, documentation and information concerning its financing and accounting status and its production and operation situations, including but not limited to the provision within 10 working days in the first month of every quarter of the Balance Sheet, Income Sheet (Statement of Income and Expenditure for any public institution), and the provision at the end of each year of a Statement of Cash Flow, etc., and a timely provision of financial statement audited by any auditing body recognized by Party A, and at the same time ensure the facticity, legality, integrality, validity of the documentations provided.

9.3 Where the liability under the Principal Contract is in a foreign currency, Party B shall undertake the guaranty liability in the currency agreed in the Principal Contract. If Party B does it in any other exchangeable currency or RMB, it shall secure the agreement of Party A, and perform the guaranty liability by converting such currency into the one agreed in the Principal Contract at the foreign exchange rate quoted at Bank of Nanjing Co., Ltd. on the day when the guaranty liability is performed.

9.4 Party B shall fulfill the following obligation of notifications:

9.4.1 Party B shall notify Party A in writing within 3 days of the occurring of the following events or of the founding of possibility of such occurrence on the side of Party B:

9.4.1.1	Party B meets with grave financial losses, which affects or possibly affects its repaying ability;
9.4.1.2	Party B involves or will involve in major lawsuits, arbitrations or other legal disputes;
9.4.1.3	Any change in Party B’s name, legal representative (responsible officer), address, telephone numbers, etc.;
9.4.1.4	Other events occurred on the side of Party B which affect or may affect its repaying ability.
9.4.2	Party B shall notify Party A in writing 30 days before the occurring or a possible occurrence of following events on the side of Party B:
9.4.2.1	Separation, transformation, merger, termination, joint venture, etc. on the side of Party B;
9.4.2.2	Changes in the business scope or of the registered capital of Party B;
9.4.2.3	Changes in the top-five investors or shareholders.
	In case of any occurrence of the above-mentioned events, which impacts or possibly impacts Party B in terms of its undertaking of the guaranty liability, Party B shall, as required by Party A, further provide other guaranty recognized by Party A.
9.5	In case of being a natural person, Party B shall notify Party A in writing within 3 days after the occurrence or a possible occurrence of the following events, in addition to observing all the stipulations under the Contract:
9.5.1	Major casualty occurred to Party B himself or his family or its income has changed greatly, in which case the economic conditions worsens and impact or possibly impact his capability of guaranty;
9.5.2	Party B changed his occupation;
9.5.3	Party B meets with such events as unemployment, divorce, or serious diseases;
9.5.4	Party B meets with other events, which cause Party B to lose or possibly lose his capability of guaranty, or impact his undertaking guaranty liability.
	In case of any occurrence of the above-mentioned events, which impacts or possibly impacts Party B in terms of its undertaking guaranty liability, Party B shall, as required by Party A, further provide other guaranty recognized by Party A.
9.6	Party B shall not refuse to fulfill the obligations under the Contract on the excuse of any dispute with a third party.
9.7	Party B enjoys the rights and assumes the responsibilities in accordance with the laws, regulations, rules, etc. and the terms and conditions of the Contract.

Article 10  Rights and Obligations of Party A

10.1 Party A has the right to directly demand Party B to undertake the guaranty guaranty liability for the unsatisfied claim of Party A under the Contract.

10.2 Party A has the right to supervise the status of fund, properties, economy, etc. of Party B, and has the right to demand Party B to present related documentation as it is.

10.3 In terms of all the receivables from Party B within the scope of the guaranty guaranty, Party A has the right to deduct its receivables directly from any settlement account opened by Party B at the side of Party A (including but not limited to current account, savings account, national debt account, etc.), and Party B bears by itself any interest, handling charge, loss from exchange rate fluctuation, etc. caused by the deduction.

10.4 Upon performance by Party B of his guaranty liability, Party A may provide Party B, as required by Party B, relevant evidence of such performance.

10.5 Party A enjoys the rights and takes the responsibilities in accordance with the laws, regulations, rules, etc. and the terms and conditions of the Contract.

Article 11  Default Liability

In case of Party B’s violation of any laws, regulations, rules, etc. or any stipulations of the Contract, Party A has the right to demand Party B to rectify its violation within a definite time, and to further provide relevant guaranty, or whatever.

Article 12  Applicable Laws and Settlement of Disputes

12.1 The Contract is concluded in accordance to the laws of People’s Republic of China, which are applicable to the Contract.

12.2 12.2 Any dispute occurred in the course of the execution of the Contract shall be settled through negotiations. In case of no settlement is reached, Type 1 shall be chosen from the following settling manners:

(Type 1)	Bring a lawsuit to the People’s Court at the locality of Party A.
(Type 2)	Apply to / Arbitration Commission for arbitration (the locality is / ) with the arbitration rules active and effective at the time the application is made. The arbitration decision is final and binding on both parties.
	In the course of lawsuit or arbitration, terms and conditions under the Contract which are not involved in the dispute shall still be performed or fulfilled.

Article 13  Effectiveness, Alteration and Termination of the Contract

13.1 Where Party B is a legal person or any organization, the Contract shall enter into effect on the day when it is signed by or sealed with the name stamp of the legal representative, principle, or accredited representative of Party A and sealed with the Corporate Seal or Special Contract Seal of Party A, and signed by or sealed with the name stamp of the legal representative or accredited representative of Party B and sealed with the Corporate Seal or Special Contract Seal of Party B; where Party B is a natural person, the Contract shall enter into effect on the day when signed by or sealed with the name stamp of the legal representative, principle, or accredited representative of Party A and sealed with the Corporate Seal or Special Contract Seal of Party A, and signed by Party B or his accredited representative.

13.2 After the Contract enters into effect, neither Party A nor Party B shall arbitrarily alter or terminate it unless further stipulated by the Contract; in the case of needy alteration or termination, a written agreement should be reached by both parties through negotiation. All terms and conditions of the Contract remain effective before such written agreement is reached.

Article 14  Miscellaneous

14.1 Party B has fully acknowledged the risk of exchange rate fluctuation. If the Principal Contract adopts floating interest rate, Party B undertakes, out of his will, the guaranty liability increased because of such fluctuations.

14.2 All attachment to the Contract, and all the legal documents related to the execution of the Contract are the component part of the Contract, and have equal legal force as the Contract.

Article 15  Supplementary Provisions

15.1 The Contract is made in two copies, one is held by Party B, and one is held by Party A, and each copy has the equal legal force.

15.2 Any matters not covered by the Contract shall be handled in compliance with relevant national laws, regulations and rules.

Article 16  Declaration Provisions

16.1 In signing and exercising the Contract, both parties have been approved by law or have been given the approval by the competent decision-maker stipulated in their respective articles of corporation or by government supervision department, and obtained the necessary, sufficient and legal authorization.

16.2 16.2 In signing the Contract, the parties expressed their true intentions, the signatures and seals were genuine, the signing representatives are authorized, and the Contract has legally binding on both parties.

16.3 16.3 Party B has the right to own its whole property, and all the documentation it produced to Party A is true, legal and effective, and contains neither mistake nor omission of facts which disagrees with the truth.

16.4 16.4 Party B has read all the content of the Contract. As requested by Party B, Party A has made relevant explanation on the terms and conditions of the Contract. Party B has got a full knowledge and understanding of the significations and legal consequences of the stipulations of the Contract.

16.5 Party A is a legally established bank, and is qualified to operate the business under the Contract.

Party A	Party B
	Legal Person or other Organization	Natural Person (Void)
Bank of Nanjing Co., Ltd. (Seal) Legal Representative (Principle or Authorized  Agent): (Signature) /s/ Wei Zhang Address: Post Code: Contact No.: Date of Signing: 2009/07/03	Jiangsu Ever-Glory International Group Corporation (Seal) Legal Representative or Authorized Agent): (Name Seal) /s/ Ruqin Wei Address: Post Code: Contact No.: Date of Signing: 2009/07/03	Signature: (or Authorized Agent): Kind of Identity Document: No. of Identity Document: Address: Post Code: Contact No.: Date of Signing:

EX-10.3

Ec1

Contract of Guaranty

No. Ec1 1101 0906 0100 031

Creditor (Party A): International Business Department, Bank of Nanjing Co., Ltd.

Surety (Party B): Goldenway Nanjing Garment Co., Ltd.

In order to ensure the performance of the Contract of Maximum Line of Credit numbered A04 1101 0906 0100 028, which was concluded between Party A and Ever-Glory International Group Apparel Inc. (hereinafter called the Debtor), and all specific business contracts, agreements, and applications under this contract (hereinafter called the Principal Contract), Party B is willing to provide the Debtor with a guaranty of joint and several liability of maximum amount. In order to clarify their liabilities and keep to their credibility, Party A and Party B have entered into the Contract for common observance and joint performance, according to governing laws, regulations and rules, and through negotiation and agreement.

Article 1  Statement and Assurance of Party B

1.1  Party B has the principal qualification of a guarantor, and is capable to provide with a guaranty of suertyship, according to the laws of People’s Republic of China.

1.2  Party B is fully capable to undertake the guarany liability, and such liability may not be alleviated or exempted due to any instruction received, financial situation changes, or any agreement reached with any body.

1.3  Party B has a full knowledge of the usage of the debt of the debtor under the Principal Contract, and Party B provides the debtor a guaranty of guarantor absolutely out of his own will while all of his declaration of will under the Contract is true.

1.4  If being a natural person, Party B confirms and assures that before providing the guaranty of guarantor under the Contract, he has made proper arrangement on the bare necessities of life for himself and his family dependents; Party A requires that Party B’s assumption of the guarantor liability shall not have any impact on the normal lives of Party B and his family members.

Article 2  The Principal Credit

2.1  The Principal Credit secured under the Contract is the full value of the Principal Credit, namely RMB40,000,000.00, said Forty Million RMB Yuan, formed by specific granting of credit (including but not limited to such on-or-off balance sheet businesses as a loan, a commitment of loan, an acceptance, a discount cash, a bond buy-back, a business financing, a factor, a letter of credit, a letter of guarantee, an overdraft, an inter-bank lending, a guaranty, etc.) conducted by Party A for the Debtor from June 1, 2009 to June 1, 2010, on the basis of the Principal Contract.

2.2  Party B provides a guarantor guaranty of maximum amount for the above-mentioned Principal Credit, irrespective of the times and the amount of each time, or whether the expiry date of the time limit for the debtor to perform his obligation overtop the foregoing time limit.

Article 3  Mode of Guaranty

Party B provides a guarantor of joint and several liabilities. Where the debtor either wholly or partly defaults when the time limit for his performance of the obligation of a single debt under the Principal Contract expires, Party A has the right to directly demand Party B to perform his obligation of guarantor.

Article 4  The Scope of the Guaranty

The scope of the guaranty of maximum amount provided by Party B includes the Principal Credit and the interest thereof (including compound interest and default interest, similarly hereinafter), default fine, compensation for damage and expenses of Party A for enforcing the claim (including but not limited to legal cost, arbitration fee, property preservation charge, travel expense, notarial fee, execution fee, attorney fee, eligibility fee, auctioneers fee, etc., and the same below).

Party B confirms and accepts out of his will, that when the Debtor fails to perform his liability stipulated in the Principal Contract, Party A has the right to directly demand Party B to undertake his guarantor liability within the scope of his guaranty, whether or not the claim of Party A under the Principal Contract is benefited with other guaranty (including but not limited to a guaranty with real rights).

Article 5  Term of the Guaranty

The term of the guaranty is the period of two years from the expiry date of the performance term of the liability caused by each time’s usage by the Debtor of the line of credit under the Principal Contract.

Where an extension agreement was reached between Party A and the Debtor of the performance term of each debt under the Principal Contract, the term of the guaranty is the period of two years from the expiry date of the performance term of a certain debt reappointed by the extension agreement; where Party A withdraws its creditor’s rights ahead of time according to laws, regulations, rules or stipulations in the Principal Contract, the term of the guaranty is the period of two years from the advanced expiry date of the Principal Liability.

Article 6  Conclusion and Alteration of the Principal Contract Guaranteed

Particulars related to specific amount, term, interest, usage, etc. of the Principal Credit, shall be stipulated by Party A and the Debtor in the Principal Contract.

Party B confirms that, except for the increase of line of credit and the extension of term of guaranty, the conclusion of the Principal Contract or the alteration of the Principal Contract through agreement by Party A and the Debtor, are deemed as being agreed in advance by Party B, and need not to be notified to Party B, while the guarantor liability on the part of Party B shall not be alleviated.

Where Party A and the Debtor alter the interest rates in the light of stipulations of the Principal Contract, such alteration shall also be deemed as being agreed in advance by Party B, and needs not to be notified to Party B, while Party B is still obliged to undertake the guarantor liability.

Article 7  Independent Effectiveness of the Contract

The effectiveness of the Contract is independent of the Principal Contract, complete or incomplete invalidity of the Principal Contract or its likely revocation has no impact on the Contract’s effectiveness. Where it is confirmed that the Principal Contract was invalid or that it was revoked, Party B undertakes further guarantor of joint and several liabilities for the Debtor’s debts coming into being because he surrendered properties or compensated losses.

Party B’s guarantor liability under the Contract shall not change to any extent because of merger, separation, changes of shareholdings, the lapse of capacity of civil acts, disappearance, death or the declaration of disappearance or death of the Debtor, or any other causes.

Article 8  Advanced Enforcement of Guaranty Liability

Where Party A declares an advanced expiration of the liability under the Principal Contract according to laws, regulations, rules etc. or stipulations in the Principal Contract, Party A has the right to immediately demand Party B to perform the liability of the guaranty.

Article 9  Rights and Obligations of Party B

9.1 Party B has the obligation to supervise the guarantee’s performance of all the obligations under the Principal Contract.

9.2  Party B shall actively cooperate with Party A and consciously subject itself to Party A’s inspection and supervision over its business operation and financial activities, and provide Party A every month, as required by Party A, documentation and information concerning its financing and accounting status and its production and operation situations, including but not limited to the provision within 10 working days in the first month of every quarter of the Balance Sheet, Income Sheet (Statement of Income and Expenditure for any public institution), and the provision at the end of each year of a Statement of Cash Flow, etc., and a timely provision of financial statement audited by any auditing body recognized by Party A, and at the same time ensure the facticity, legality, integrality, validity of the documentations provided.

9.3  Where the liability under the Principal Contract is in a foreign currency, Party B shall undertake the guarantor liability in the currency agreed in the Principal Contract. If Party B does it in any other exchangeable currency or RMB, it shall secure the agreement of Party A, and perform the guarantor liability by converting such currency into the one agreed in the Principal Contract at the foreign exchange rate quoted at Bank of Nanjing Co., Ltd. on the day when the guarantor liability is performed.

9.4 Party B shall fulfill the following obligation of notifications:

9.4.1  Party B shall notify Party A in writing within 3 days of the occurring of the following events or of the founding of possibility of such occurrence on the side of Party B:

9.4.1.1  Party B meets with grave financial losses, which affects or possibly affects its repaying ability;

9.4.1.2  Party B involves or will involve in major lawsuits, arbitrations or other legal disputes;

9.4.1.3  Any change in Party B’s name, legal representative (responsible officer), address, telephone numbers, etc.;

9.4.1.4  Other events occurred on the side of Party B which affect or may affect its repaying ability.

9.4.2  Party B shall notify Party A in writing 30 days before the occurring or a possible occurrence of following events on the side of Party B:

9.4.2.1  Separation, transformation, merger, termination, joint venture, etc. on the side of Party B;

9.4.2.2  Changes in the business scope or of the registered capital of Party B;

9.4.2.3  Changes in the top-five investors or shareholders.

In case of any occurrence of the above-mentioned events, which impacts or possibly impacts Party B in terms of its undertaking of the guaranty liability, Party B shall, as required by Party A, further provide other guaranty recognized by Party A.

9.5  In case of being a natural person, Party B shall notify Party A in writing within 3 days after the occurrence or a possible occurrence of the following events, in addition to observing all the stipulations under the Contract:

9.5.1 Major casualty occurred to Party B himself or his family or its income has changed greatly, in which case the economic conditions worsens and impact or possibly impact his capability of guaranty;

9.5.2  Party B changed his occupation;

9.5.3  Party B meets with such events as unemployment, divorce, or serious diseases;

9.5.4  Party B meets with other events which cause Party B to lose or possibly lose his capability of guaranty, or impact his undertaking guaranty liability.

In case of any occurrence of the above-mentioned events, which impacts or possibly impacts Party B in terms of its undertaking guaranty liability, Party B shall, as required by Party A, further provide other guaranty recognized by Party A.

9.6  Party B shall not refuse to fulfill the obligations under the Contract on the excuse of any dispute with a third party.

9.7 Party B enjoys the rights and assumes the responsibilities in accordance with the laws, regulations, rules, etc. and the terms and conditions of the Contract.

Article 10  Rights and Obligations of Party A

10.1 Party A has the right to directly demand Party B to undertake the guarantor liability for the unsatisfied claim of Party A under the Contract.

10.2 Party A has the right to supervise the status of fund, properties, economy, etc. of Party B, and has the right to demand Party B to present related documentation as it is.

10.3 In terms of all the receivables from Party B within the scope of the guaranty, Party A has the right to deduct its receivables directly from any settlement account opened by Party B at the side of Party A (including but not limited to current account, savings account, national debt account, etc.), and Party B bears by itself any interest, handling charge, loss from exchange rate fluctuation, etc. caused by the deduction.

10.4 Upon performance by Party B of his guaranty liability, Party A may provide Party B, as required by Party B, relevant evidence of such performance.

10.5 Party A enjoys the rights and takes the responsibilities in accordance with the laws, regulations, rules, etc. and the terms and conditions of the Contract.

Article 11  Default

In case of Party B’s violation of any laws, regulations, rules, etc. or any stipulations of the Contract, Party A has the right to demand Party B to rectify its violation within a definite time, and to further provide relevant guaranty, or whatever.

Article 12  Applicable Laws and Settlement of Disputes

12.1 The Contract is concluded in accordance to the laws of People’s Republic of China, which are applicable to the Contract.

12.2  Any dispute occurred in the course of the execution of the Contract shall be settled through negotiations. In case of no settlement is reached, Type 1 shall be chosen from the following settling manners:

(Type1)	Bring a lawsuit to the People’s Court at the locality of Party A.
(Type 2)	Apply to / Arbitration Commission for arbitration (the locality is / ) with the arbitration rules active and effective at the time the application is made. The arbitration decision is final and binding on both parties.
	In the course of lawsuit or arbitration, terms and conditions under the Contract which are not involved in the dispute shall still be performed or fulfilled.

Article 13  Effectiveness, Alteration and Termination of the Contract

13.1  Where Party B is a legal person or any organization, the Contract shall enter into effect on the day when it is signed by or sealed with the name stamp of the legal representative, principle, or accredited representative of Party A and sealed with the Corporate Seal or Special Contract Seal of Party A, and signed by or sealed with the name stamp of the legal representative or accredited representative of Party B and sealed with the Corporate Seal or Special Contract Seal of Party B; where Party B is a natural person, the Contract shall enter into effect on the day when signed by or sealed with the name stamp of the legal representative, principle, or accredited representative of Party A and sealed with the Corporate Seal or Special Contract Seal of Party A, and signed by Party B or his accredited representative.

13.2 After the Contract enters into effect, neither Party A nor Party B shall arbitrarily alter or terminate it unless further stipulated by the Contract; in the case of needy alteration or termination, a written agreement should be reached by both parties through negotiation. All terms and conditions of the Contract remain effective before such written agreement is reached.

Article 14  Other Stipulations

14.1  Party B has fully acknowledged the risk of exchange rate fluctuation. If the Principal Contract adopts floating interest rate, Party B undertakes, out of his will, the guaranty liability increased because of such fluctuations.

14.2  All attachment to the Contract, and all the legal documents related to the execution of the Contract are the component part of the Contract, and have equal legal force as the Contract.

Article 15  Supplementary Provisions

15.1 The Contract is made in two copies, one is held by Party B, and one is held by Party A, and each copy has the equal legal force.

15.2 Any matters not covered by the Contract shall be handled in compliance with relevant national laws, regulations and rules.

Article 16  Declaration Provisions

16.1 In signing and exercising the Contract, both parties have been approved by law or have been given the approval by the competent decision-maker stipulated in their respective articles of corporation or by government supervision department, and obtained the necessary, sufficient and legal authorization.

16.2 In signing the Contract, the parties expressed their true intentions, the signatures and seals were genuine, the signing representatives are authorized, and the Contract has legally binding on both parties.

16.3 Party B has the right to own its whole property, and all the documentation it produced to Party A is true, legal and effective, and contains neither mistake nor omission of facts which disagrees with the truth.

16.4 Party B has read all the content of the Contract. As requested by Party B, Party A has made relevant explanation on the terms and conditions of the Contract. Party B has got a full knowledge and understanding of the significations and legal consequences of the stipulations of the Contract.

16.5 Party A is a legally established bank, and is qualified to operate the business under the Contract.

Party A	Party B
	Legal Person or other Organization	Natural Person (Void)
Bank of Nanjing Co., Ltd. (Seal) Legal Representative (Principle or Authorized  Agent): (Signature) /s/ Wei Zhang Address: Post Code: Contact No.: Date of Signing: July 3, 2009	Goldenway Nanjing Garment Co., Ltd. (Seal) Legal Representative or Authorized Agent): (Name Seal) /s/ Jiajun Sun Address: Post Code: Contact No.: Date of Signing: July 3, 2009	Signature: (or Authorized Agent): Kind of Identity Document: No. of Identity Document: Address: Post Code: Contact No.: Date of Signing: