Exhibit 4.7


    
      

    

    Exhibit
      4.7

     

    INSIDER
      PLEDGE AND ESCROW AGREEMENT

     

    THIS
      INSIDER PLEDGE AND ESCROW AGREEMENT
      (the
“Agreement”)
      is
      made and entered into as of January 5, 2006 (the “Effective
      Date”)
      by and
      among PHILIPP
      BUSCHMANN and MICHAEL PIAZZA (collectively,
      the “Pledgor”),
      CORNELL
      CAPITAL PARTNERS, LP
      (the
“Pledgee”),
      IGNIS
      PETROLEUM GROUP, INC.,
      a Nevada
      corporation (the “Company”),
      and
DAVID
      GONZALEZ,
      ESQ.,
      as
      escrow agent (“Escrow
      Agent”).
      

     

    RECITALS:

     

    WHEREAS,
      the
      Company shall issue and sell to the Pledgee, as provided in the Securities
      Purchase Agreement of even date herewith between the Company and the Pledgee
      (the “Securities
      Purchase Agreement”),
      and
      the Pledgee shall purchase up to Five Million Dollars ($5,000,000) of secured
      convertible debentures (the “Convertible
      Debentures”),
      which
      shall be convertible into shares of the Company’s common stock, par value $0.001
      per share (the “Common
      Stock”)
      (as
      converted, the “Conversion
      Shares”);

     

    WHEREAS,
      to
      induce
      the Pledgee to enter into the transaction contemplated by the Securities
      Purchase Agreement, the Convertible Debentures, the Investor Registration Rights
      Agreement of even date herewith between the Company and the Pledgee (the
“Investor
      Registration Rights Agreement”),
      the
      Pledge and Escrow Agreement of even date herewith among the Company, the Pledgee
      and the Escrow Agent (the “Pledge
      Agreement”),
      the
      Escrow Agreement of even date herewith among the Company, the Pledgee, and
      the
      Escrow Agent (the “Escrow
      Agreement”),
      and
      the Irrevocable Transfer Agent Instructions among the Company, the Pledgee,
      the
      Transfer Agent, and the Escrow Agent (the “Transfer
      Agent Instructions”)
      (collectively referred to as the “Transaction
      Documents”),
      the
      Pledgor has agreed to irrevocably pledge to the Pledgee without recourse against
      the Pledgor Four Million Three Hundred Twenty Thousand (4,320,000) shares (the
      “Pledged
      Shares”)
      of
      Common Stock beneficially owned by the Pledgor in the amounts specified on
      the
      signature line hereto and in accordance with this Agreement.

     

    NOW,
      THEREFORE,
      in
      consideration of the mutual covenants, agreements, warranties, and
      representations herein contained, and for other good and valuable consideration,
      the receipt and sufficiency of which is hereby acknowledged, the parties hereto
      agree as follows:

     

    TERMS
      AND CONDITIONS

     

    1.    Obligations
      Secured.  The
      obligations secured hereby are any and all obligations of the Company now
      existing or hereinafter incurred to the Pledgee under the Transaction Documents
      and any other amounts now or hereafter owed to the Pledgee by the Company
      thereunder (collectively, the “Obligations”).

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    2.    Pledge
      and Transfer of Pledged Shares. 
      The
      Pledgor hereby grants to Pledgee an irrevocable, first priority security
      interest in all Pledged Shares as security for the Company’s Obligations.
      Simultaneously with the execution of the Transaction Documents, the Pledgor
      shall deliver to the Escrow Agent stock certificates made out in favor of the
      Pledgor representing the Pledged Shares, together with duly executed stock
      powers or other appropriate transfer documents with medallion bank guarantees
      and executed in blank by the Pledgor (the “Transfer
      Documents”),
      and
      such stock certificates and Transfer Documents shall be held by the Escrow
      Agent
      until the earlier of (i) full payment of all Obligations due to the Pledgee,
      including the repayment or conversion of all amounts owed by the Company to
      the
      Pledgee under the Convertible Debentures (whether outstanding principal,
      interest, legal fees, or any other amounts owed to the Pledgee by the Company)
      or (ii) the receipt by the Escrow Agent of an equal number of shares of common
      stock as pledged hereunder from the Company, together with duly executed stock
      powers or other appropriate transfer documents executed in blank by the Company
      (the “Additional Company Pledged Shares”).

     

    3.    Rights
      Relating to Pledged Shares. 
      Upon the occurrence of an Event of Default (as defined herein), the Pledgee
      shall be entitled to vote the Pledged Shares, receive dividends and other
      distributions thereon, and enjoy all other rights and privileges incident to
      the
      ownership of the number of Pledged Shares actually released from escrow in
      accordance with Section 6.1 hereof. 

     

    4.    Release
      of Pledged Shares from Pledge. 
      Upon the earlier of (i) receipt by the Escrow Agent of the Additional Company
      Pledged Shares or (ii) full payment of all Obligations due to the Pledgee under
      the Transaction Documents, including the repayment or conversion in accordance
      with the terms of the Convertible Debentures of all amounts owed by the Company
      to the Pledgee under the Convertible Debentures (whether outstanding principal,
      interest, legal fees, and any other amounts owed to the Pledgee by the Company),
      the parties hereto shall notify the Escrow Agent to such effect in writing.
      Promptly upon receipt of such written notice, the Escrow Agent shall return
      to
      the Pledgor the Transfer Documents and the certificates representing the Pledged
      Shares (collectively the “Pledged
      Materials”),
      whereupon any and all rights of Pledgee in the Pledged Materials shall be
      terminated. Notwithstanding anything to the contrary contained herein, upon
      the
      earlier of (i) receipt by the Escrow Agent of the Additional Company Pledged
      Shares or (ii) full payment of all amounts due to the Pledgee under the
      Convertible Debentures, by repayment or conversion in accordance with the terms
      of the Convertible Debentures, this Agreement and Pledgee’s security interest
      and rights in and to the Pledged Shares shall terminate.

     

    5.    Event
      of Default. 
      An “Event
      of Default”
shall
      be deemed to have occurred under this Agreement upon an Event of Default under
      the Convertible Debentures.

     

    6.    Remedies.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    


    a.   Upon
      and
      anytime after the occurrence of an Event of Default, the Pledgee shall have
      the
      right to provide written notice of such Event of Default (the “Default
      Notice”)
      to the Escrow Agent, with a copy to the Pledgor. As soon as practicable after
      receipt of the Default Notice, the Escrow Agent shall deliver to Pledgee the
      Pledged Materials held by the Escrow Agent hereunder. Upon receipt of the
      Pledged Materials and after exercising such rights the Pledgee has under any
      shares of common stock pledged by the Company, the Pledgee shall have the right
      to (i) sell the Pledged Shares and to apply the proceeds of such sales, net
      of
      any selling commissions, to the Obligations owed to the Pledgor by the Company
      under the Transaction Documents, including, without limitation, outstanding
      principal, interest, legal fees, and any other amounts owed to the Pledgee,
      and
      exercise all other rights and (ii) any and all remedies of a secured party
      with
      respect to such property as may be available under the Uniform Commercial Code
      as in effect in the State of New Jersey. To the extent that the net proceeds
      received by the Pledgee are insufficient to satisfy the Obligations in full,
      the
      Pledgee shall be entitled to a deficiency judgment against the Company but
      not
      the Pledgor for such amount. The Pledgee shall have the absolute right to sell
      or dispose of the Pledged Shares in any manner it sees fit and shall have no
      liability to the Pledgor, the Company or any other party for selling or
      disposing of such Pledged Shares even if other methods of sales or dispositions
      would or allegedly would result in greater proceeds than the method actually
      used. The Escrow Agent shall have the absolute right to disburse the Pledged
      Shares to the Pledgee in batches not to exceed 9.9% of the outstanding capital
      of the Company (which limit may be waived by the Pledgee providing not less
      than
      65 days’ prior written notice to the Escrow Agent). The Pledgee shall return any
      Pledged Shares released to it and remaining after the Pledgee has applied the
      net proceeds to all amounts owed to the Pledgee. 

     

    b.   Each
      right, power and remedy of the Pledgee provided for in this Agreement or any
      other Transaction Document shall be cumulative and concurrent and shall be
      in
      addition to every other such right, power or remedy. The
      exercise or beginning of the exercise by the Pledgee of any one or more of
      the
      rights, powers or remedies provided for in this Agreement or any
      other
      Transaction Document or
      now or
      hereafter existing at law or in equity or by statute or otherwise shall not
      preclude the simultaneous or later exercise by the
      Pledgee of all such other rights, powers or remedies, and no failure or delay
      on
      the part of the Pledgee to exercise any such right, power or remedy shall
      operate as a waiver thereof. No notice to or demand on the Pledgor in any case
      shall entitle it to any other or further notice or demand in similar or other
      circumstances or constitute a waiver of any of the rights of the Pledgee to
      any
      other further action in any circumstances without demand or notice. The Pledgee
      shall have the full power to enforce or to assign or contract is rights under
      this Agreement to a third party.

     

    7.    Representations,
      Warranties and Covenants.

     

    a.   The
      Pledgor represents, warrants and covenants that:

     

    (i)   Pledgor
      is, and at the time when pledged hereunder will be, the legal, beneficial and
      record owner of, and has (and will have)
      good and
      valid title to, all Pledged Shares pledged hereunder, subject to no pledge,
      lien, mortgage, hypothecation, security interest, charge, option or other
      encumbrance whatsoever;

     

    (ii)   
        Pledgor
      has full power, authority and legal right to pledge all the Pledged Shares
      pledged pursuant to this Agreement; and

     

    (iii)  
        all
      the
      Pledged Shares are fully paid and non-assessable and are subject to no options
      to purchase or similar rights.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    


    b.   The
      Pledgor covenants and agrees to take all reasonable steps to defend the
      Pledgee’s right, title and security interest in and to the Pledged Shares and
      the proceeds thereof against the claims and demands of all persons whomsoever
      (other than the Pledgee and the Escrow Agent); and the Pledgor covenants and
      agrees that it will have like title to
      and
      right to pledge any other property at any time hereafter pledged to the Pledgee
      as Collateral hereunder and will likewise take all reasonable steps to defend
      the right thereto and security interest therein of the Pledgee.

     

    c.   The
      Pledgor covenants and agrees to take no action which would violate or be
      inconsistent with any of the terms of any Transaction Document, or which would
      have the effect of impairing the position or interests of the Pledgee under
      any
      Transaction Document.

     

    d.   This
      Agreement is made without recourse. Upon an Event of Default, the Pledgee shall
      be deemed to have acquired the Pledged Shares on the date they were acquired
      by
      the Pledgor. The Pledgor is an “affiliate” of the Company, as such term is
      defined in Rule 144(a) promulgated under the Securities Act of 1933, as
      amended.

     

    8.    Concerning
      the Escrow Agent.

     

    a.   The
      Escrow Agent undertakes to perform only such duties as are expressly set forth
      herein and no implied duties or obligations shall be read into this Agreement
      against the Escrow Agent.

     

    b.   The
      Escrow Agent may act in reliance upon any writing or instrument or signature
      which it, in good faith, believes to be genuine, may assume the validity and
      accuracy of any statement or assertion contained in such a writing or
      instrument, and may assume that any person purporting to give any writing,
      notice, advice or instructions in connection with the provisions hereof has
      been
      duly authorized to do so. The Escrow Agent shall not be liable in any manner
      for
      the sufficiency or correctness as to form, manner, and execution, or validity
      of
      any instrument deposited in this escrow, nor as to the identity, authority,
      or
      right of any person executing the same; and its duties hereunder shall be
      limited to the safekeeping of such certificates, monies, instruments, or other
      document received by it as such escrow holder, and for the disposition of the
      same in accordance with the written instruments accepted by it in the
      escrow.

     

    c.   Pledgee
      and the Pledgor hereby agree, to defend and indemnify the Escrow Agent and
      hold
      it harmless from any and all claims, liabilities, losses, actions, suits, or
      proceedings at law or in equity, or any other expenses, fees, or charges of
      any
      character or nature which it may incur or with which it may be threatened by
      reason of its acting as Escrow Agent under this Agreement; and in connection
      therewith, to indemnify the Escrow Agent against any and all expenses, including
      attorneys’ fees and costs of defending any action, suit, or proceeding or
      resisting any claim (and any costs incurred by the Escrow Agent pursuant to
      Sections 6.4 or 6.5 hereof). The Escrow Agent shall be vested with a lien on
      all
      property deposited hereunder, for indemnification of attorneys’ fees and court
      costs regarding any suit, proceeding or otherwise, or any other expenses, fees,
      or charges of any character or nature, which may be incurred by the Escrow
      Agent
      by reason of disputes arising between the makers of this escrow as to the
      correct interpretation of this Agreement and instructions given to the Escrow
      Agent hereunder, or otherwise, with the right of the Escrow Agent, regardless
      of
      the instructions aforesaid, to hold said property until and unless said
      additional expenses, fees, and charges shall be fully paid. Any fees and costs
      charged by the Escrow Agent for serving hereunder shall be paid by the
      Pledgor.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    


    d.   If
      any of
      the parties shall be in disagreement about the interpretation of this Agreement,
      or about the rights and obligations, or the propriety of any action contemplated
      by the Escrow Agent hereunder, the Escrow Agent may, at its sole discretion
      deposit the Pledged Materials with the Clerk of the United States District
      Court
      of New Jersey, sitting in Newark, New Jersey, and, upon notifying all parties
      concerned of such action, all liability on the part of the Escrow Agent shall
      fully cease and terminate. The Escrow Agent shall be indemnified by the Pledgor,
      the Company and Pledgee for all costs, including reasonable attorneys’ fees in
      connection with the aforesaid proceeding, and shall be fully protected in
      suspending all or a part of its activities under this Agreement until a final
      decision or other settlement in the proceeding is received.

     

    e.   The
      Escrow Agent may consult with counsel of its own choice (and the costs of such
      counsel shall be paid by the Pledgor and Pledgee) and shall have full and
      complete authorization and protection for any action taken or suffered by it
      hereunder in good faith and in accordance with the opinion of such counsel.
      The
      Escrow Agent shall not be liable for any mistakes of fact or error of judgment,
      or for any actions or omissions of any kind, unless caused by its willful
      misconduct or gross negligence.

     

    f.   The
      Escrow Agent may resign upon ten (10) days’ written notice to the parties in
      this Agreement. If a successor Escrow Agent is not appointed within this ten
      (10) day period, the Escrow Agent may petition a court of competent jurisdiction
      to name a successor.

     

    9.    Conflict
      Waiver. 
      The Pledgor hereby acknowledges that the Escrow Agent is general counsel to
      the
      Pledgee, a partner in the general partner of the Pledgee, and counsel to the
      Pledgee in connection with the transactions contemplated and referred herein.
      The Pledgor agrees that in the event of any dispute arising in connection with
      this Agreement or otherwise in connection with any transaction or agreement
      contemplated and referred herein, the Escrow Agent shall be permitted to
      continue to represent the Pledgee and the Pledgor will not seek to disqualify
      such counsel and waives any objection Pledgor might have with respect to the
      Escrow Agent acting as the Escrow Agent pursuant to this Agreement.


     

    10.      Notices. 
      Unless otherwise provided herein, all demands, notices, consents, service of
      process, requests and other communications hereunder shall be in writing and
      shall be delivered in person or by overnight courier service, or mailed by
      certified mail, return receipt requested, addressed:

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    
      	
              If
                to the Company, to:

            	
              Ignis
                Petroleum Group, Inc.

            
	 	
              100
                Crescent Court - 7th
                Floor

            
	 	
              Dallas,
                TX 75201

            
	 	
              Attention:

            	
              Michael
                Piazza

            
	 	
              Telephone:

            	
              (214)
                459-8188

            
	 	
              Facsimile:

            	
              (214)
                459-3101

            
	 	 	 
	
              With
                a copy to:

            	
              Sichenzia
                Ross Friedman Ference LLP

            
	 	
              1065
                Avenue of the Americas - 21st
                Floor

            
	 	
              New
                York, NY 10018

            
	 	
              Attention:

            	
              Gregory
                Sichenzia, Esq.

            
	 	
              Telephone:

            	
              (212)
                930-9700

            
	 	
              Facsimile:

            	
              (212)
                930-9725

            
	 	 	 
	 	
              And

            	 
	 	 	 
	 	
              Cantey
                & Hanger, LLP

            
	 	
              801
                Cherry Street, Suite 2100

            
	 	
              Fort
                Worth, Texas 76102

            
	 	
              Attention:

            	
              Douglas
                W. Clayton, Esq.

            
	 	
              Telephone:

            	
              (817)
                877-2890

            
	 	
              Facsimile:

            	
              (817)
                877-2807

            
	 	 	 
	
              If
                to the Pledgee:

            	
              Cornell
                Capital Partners LP

            
	 	
              101
                Hudson Street, Suite 3700

            
	 	
              Jersey
                City, NJ 07302

            
	 	
              Attention:

            	
              Mark
                A. Angelo

            
	 	
              Telephone:

            	
              (201)
                985-8300

            
	 	
              Facsimile:

            	
              (201)
                985-8744

            
	 	 	 
	
              With
                copy to:

            	
              Cornell
                Capital Partners, LP

            
	 	
              101
                Hudson Street, Suite 3700

            
	 	
              Jersey
                City, NJ 07302

            
	 	
              Attention:

            	
              David
                Gonzalez, Esq.

            
	 	
              Telephone:

            	
              (201)
                985-8300

            
	 	
              Facsimile:

            	
              (201)
                985-1964

            
	 	 	 
	
              If
                to the Pledgor, to:

            	
              Philipp
                Buschmann

            
	 	
              100
                Crescent Court - 7th
                Floor

            
	 	
              Dallas,
                TX 75201

            
	 	
              Telephone:

            	
              (214)
                459-8188

            
	 	
              Facsimile:

            	
              (214)
                459-3101

            
	 	 	 
	 	
              Michael
                Piazza

            
	 	
              100
                Crescent Court - 7th
                Floor

            
	 	
              Dallas,
                TX 75201

            
	 	
              Telephone:

            	
              (214)
                459-8188

            
	 	
              Facsimile:

            	
              (214)
                459-3101

            


    

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    


    Any
      such
      notice shall be effective (a) when delivered, if delivered by hand delivery
      or overnight courier service, or (b) five (5) days after deposit in the
      United States mail, as applicable.

     

    11.   
        Binding
      Effect. 
      All of the covenants and obligations contained herein shall be binding upon
      and
      shall inure to the benefit of the respective parties, their successors and
      assigns.

     

    12.  
         Governing
      Law; Venue; Service of Process. 
      The validity, interpretation and performance of this Agreement shall be
      determined in accordance with the laws of the State of New Jersey applicable
      to
      contracts made and to be performed wholly within that state except to the extent
      that Federal law applies. The parties hereto agree that any disputes, claims,
      disagreements, lawsuits, actions or controversies of any type or nature
      whatsoever that, directly or indirectly, arise from or relate to this Agreement,
      including, without limitation, claims relating to the inducement, construction,
      performance or termination of this Agreement, shall be brought in the state
      superior courts located in Hudson County, New Jersey or Federal district courts
      located in Newark, New Jersey, and the parties hereto agree not to challenge
      the
      selection of that venue in any such proceeding for any reason, including,
      without limitation, on the grounds that such venue is an inconvenient forum.
      The
      parties hereto specifically agree that service of process may be made, and
      such
      service of process shall be effective if made, pursuant to Section 8
      hereto.

     

    13.   
        Enforcement
      Costs.  
      If any legal action or other pro-ceeding is brought for the enforcement of
      this
      Agreement, or because of an alleged dispute, breach, default or
      misrepresenta-tion in connection with any provisions of this Agreement, the
      successful or prevailing party or parties shall be entitled to recover
      reasonable attorneys’ fees, court costs and all expenses even if not taxable as
      court costs (including, without limita-tion, all such fees, costs and expenses
      incident to appeals), incurred in that action or proceeding, in addition to
      any
      other relief to which such party or parties may be entitled.

     

    14.   
        Remedies
      Cumulative. 
No
      remedy herein conferred upon any party is intended to be exclusive of any other
      remedy, and each and every such remedy shall be cumulative and shall be in
      addition to every other remedy given hereunder or now or here-after existing
      at
      law, in equity, by statute, or otherwise. No single or partial exercise by
      any
      party of any right, power or remedy hereunder shall preclude any other or
      further exercise thereof. 

     

    15.   
        Counterparts. 
      This Agreement may be executed in one or more counterparts, each of which shall
      be deemed an original, but all of which together shall constitute the same
      instrument.

     

    16.   
        No
      Penalties. 
No
      provision of this Agreement is to be interpreted as a penalty upon any party
      to
      this Agreement.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    


    17.   
        JURY
      TRIAL. 
      EACH OF THE PLEDGEE AND THE PLEDGOR HEREBY KNOWINGLY, VOLUNTARILY AND
      INTENTIONALLY WAIVES THE RIGHT WHICH IT MAY HAVE TO A TRIAL BY JURY OF ANY
      CLAIM, DEMAND, ACTION OR CAUSE OF ACTION BASED HEREON, OR ARISING OUT OF, UNDER
      OR IN ANY WAY CONNECTED WITH THE DEALINGS BETWEEN PLEDGEE AND PLEDGOR, THIS
      PLEDGE AND ESCROW AGREEMENT OR ANY DOCUMENT EXECUTED IN CONNECTION HEREWITH,
      OR
      ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN)
      OR ACTIONS OF ANY PARTY HERETO OR THERETO IN EACH CASE WHETHER NOW EXISTING
      OR
      HEREAFTER ARISING, AND WHETHER IN CONTRACT, TORT, EQUITY OR OTHERWISE.


     

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        8

        
          

        

      

      
        
        

      

    

    


    IN
      WITNESS WHEREOF,
      the
      parties hereto have duly executed this Insider Pledge and Escrow Agreement
      as of
      the date first above written. 

     

    
      
        	 	
                
                  CORNELL
                    CAPITAL PARTNERS, LP

                

              
	 	 
	 	
                By:

              	
                Yorkville
                  Advisors, LLC

              
	 	
                Its:

              	
                General
                  Partner

              
	 	 
	 	 
	 	
                By:

              	
                /s/
                  MARK ANGELO

              
	 	
                Name:

              	
                Mark
                  Angelo

              
	 	
                Title:

              	
                Portfolio
                  Manager

              
	 	 
	 	 
	 	
                PLEDGORS

              
	 	 
	 	
                By:

              	
                /s/
                  PHILIPP BUSCHMANN

              
	 	
                Name:

              	
                Philipp
                  Buschmann

              
	 	
                Number
                  of shares pledged: 3,820,000

              
	 	 
	 	 
	 	
                By:

              	
                /s/
                  MICHAEL PIAZZA

              
	 	
                Name:

              	
                Michael
                  Piazza

              
	 	
                Number
                  of shares pledged: 500,000

              
	 	 
	 	 
	 	
                
                  IGNIS
                    PETROLEUM GROUP, INC.

                

              
	 	 
	 	 
	 	
                By:

              	
                /s/
                  MICHAEL PIAZZA

              
	 	
                Name:

              	
                Michael
                  Piazza

              
	 	
                Title:

              	
                President
                  & CEO

              
	 	 
	 	 
	 	
                
                  ESCROW
                    AGENT

                

              
	 	
                By:

              	
                /s/
                  DAVID GONZALEZ

              
	 	
                Name:

              	
                David
                  Gonzalez, Esq. 

              


      

       

    

    FOR
      VALUE RECEIVED,
      the
      Pledgor hereby unconditionally and absolutely guarantees the Company’s
      Obligations (as defined above) solely to the extent of the Pledged Shares.
      This
      Agreement is made without any recourse to the Pledgor.

    


    


    
      	
              By:
                /s/
                PHILIPP BUSCHMANN

            	By:
              /s/
              MICHAEL PIAZZA
	
              Name:
                Philipp
                Buschmann

            	Name:
              Michael
              Piazza


    

     

     

    9