FORM
      LOCK
      UP
      AGREEMENT

     

    May
      22,
      2008

     

    Oppenheimer
      & Co. Inc.

    300
      Madison Avenue

    New
      York,
      New York 10017

     

    Ladies
      and Gentlemen:

    


    This
      Lock-Up Agreement is being delivered to you in connection with the proposed
      Purchase Agreement (the “Purchase
      Agreement”)
      to be
      entered into by ShengdaTech, Inc., a Nevada corporation (the “Company”),
      and
      you with respect to the offering (the “Offering”)
      without registration under the Securities Act of 1933, as amended (the
“Act”),
      and
      initial resale in reliance on Rule 144A under the Act, of $100,000,000 of
      6.00% Senior
      Convertible Notes due 2018 (the “Notes”)
      of the
      Company. Capitalized terms used herein without definition shall have the
      respective meanings ascribed to them in the Purchase Agreement.

     

    In
      order
      to induce you to enter into the Purchase Agreement, the undersigned agrees
      that,
      for a period (the “Lock-Up
      Period”)
      beginning on the date hereof and ending on, and including, the date that is
      90 days after the date of the final offering memorandum relating to the
      Offering, the undersigned will not, without your prior written consent,
      (i) sell, offer to sell, contract or agree to sell, hypothecate, pledge,
      grant any option to purchase or otherwise dispose of or agree to dispose of,
      directly or indirectly, or file (or participate in the filing of) a registration
      statement with the Securities and Exchange Commission (the “Commission”)
      in
      respect of, or establish or increase a put equivalent position or liquidate
      or
      decrease a call equivalent position within the meaning of Section 16 of the
      Securities Exchange Act of 1934, as amended, and the rules and regulations
      of
      the Commission promulgated thereunder (the “Exchange
      Act”)
      with
      respect to, any Common Stock, $0.00001 par value per share, of the Company
      (the
“Common
      Stock”),
      the
      Notes or any other securities of the Company that are substantially similar
      to
      the Common Stock or the Notes, or any securities convertible into or
      exchangeable or exercisable for, or any warrants or other rights to purchase,
      the foregoing, (ii) enter into any swap or other arrangement that transfers
      to another, in whole or in part, any of the economic consequences of ownership
      of the Common Stock, the Notes or any other securities of the Company that
      are
      substantially similar to the the Common Stock or the Notes, or any securities
      convertible into or exchangeable or exercisable for, or any warrants or other
      rights to purchase, the foregoing, whether any such transaction is to be settled
      by delivery of Common Stock or such other securities, in cash or otherwise
      or
      (iii) publicly announce an intention to effect any transaction specified in
      clause (i) or (ii). The foregoing sentence shall not apply to (a) bona fide
      gifts or distributions without consideration, provided the recipient thereof
      agrees in writing with the Initial Purchasers to be bound by the terms of this
      Lock-Up Agreement, or (b) dispositions to any trust for the direct or
      indirect benefit of the undersigned and/or the immediate family of the
      undersigned, provided that such trust agrees in writing with the Initial
      Purchasers to be bound by the terms of this Lock-Up Agreement, or
      (c) transfers that occur by operation of law, such as the rules of
      intestate succession or statutes governing the effects of a merger, provided
      the
      transferee thereof agrees in writing with the Initial Purchasers to be bound
      by
      the terms of this Lock-Up Agreement. For purposes of this paragraph, “immediate
      family” shall mean the undersigned and the spouse, any lineal descendent,
      father, mother, brother or sister of the undersigned.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    In
      addition, the undersigned hereby waives any rights the undersigned may have
      to
      require registration of Common Stock in connection with the filing of any
      registration statement to be filed with the Commission pursuant to the
      Registration Rights Agreement. The undersigned further agrees that, for the
      Lock-Up Period, the undersigned will not, without your prior written consent,
      make any demand for, or exercise any right with respect to, the registration
      of
      Common Stock or any securities convertible into or exercisable or exchangeable
      for Common Stock, or warrants or other rights to purchase Common Stock or any
      such securities.

     

    * * *

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    


    If
      (i) the Company notifies you in writing that it does not intend to proceed
      with the Offering or (ii) for any reason the Purchase Agreement shall be
      terminated prior to the “Firm Notes Closing Date” (as defined in the Purchase
      Agreement), this Lock-Up Agreement shall be terminated and the undersigned
      shall
      be released from its obligations hereunder.

     

    
      	 	 	
              Yours
                very truly,

            
	 	 	 
	 	 	            
               
	 	 	
              Name: