NEITHER
      THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS EXERCISABLE HAVE
      BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES
      COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER
      THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY,
      MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
      STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM,
      OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
      SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS
      EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE
      SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS SECURITY
      AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN
      CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH
      SECURITIES.

     

    CLASS
      A COMMON STOCK PURCHASE WARRANT 

     

    CHINA
      CLEAN ENERGY INC. 

     

    
      	
              Warrant
                Shares:      

            	
              Initial
                Exercise Date: January 9, 2008

            


    

     

    THIS
      CLASS A COMMON STOCK PURCHASE WARRANT (the “Warrant”)
      certifies that, for value received, ________________________ (the “Holder”),
      is
      entitled, upon the terms and subject to the limitations on exercise and the
      conditions hereinafter set forth, at any time on or after the date hereof (the
      “Initial
      Exercise Date”)
      and on
      or prior to the close of business on the fifth anniversary of the Initial
      Exercise Date (the “Termination
      Date”)
      but
      not thereafter, to subscribe for and purchase from China Clean Energy Inc.,
      a
      Delaware corporation (the “Company”),
      up to
      _____________ shares (the “Warrant
      Shares”)
      of
      common stock, par value $0.001 per share, of the Company (the “Common
      Stock”).
      The
      purchase price of one share of Common Stock under this Warrant shall be $2.00,
      subject to adjustment hereunder (the “Exercise
      Price”).
      

     

    Section
      1. Definitions.
      Capitalized terms used and not otherwise defined herein shall have the meanings
      set forth in that certain Securities Purchase Agreement (the “Purchase
      Agreement”),
      dated
      January 9, 2008, among the Company and the purchasers signatory thereto.


     

    Section
      2. Exercise.
      

     

    (a) Exercise
      of Warrant.
      Exercise of the purchase rights represented by this Warrant may be made, in
      whole or in part, at any time or times on or after the Initial Exercise Date
      and
      on or before the Termination Date by delivery to the Company of a duly executed
      facsimile copy of the Notice of Exercise Form annexed hereto (or such other
      office or agency of the Company as it may designate by notice in writing to
      the
      registered Holder at the address of such Holder appearing on the books of the
      Company); and, within 3 Trading Days of the date said Notice of Exercise is
      delivered to the Company, the Company shall have received payment of the
      aggregate Exercise Price of the shares thereby purchased by wire transfer or
      cashier’s check drawn on a United States bank. 

     

    
      
        
        

      

      
         

        
          

        

      

      
        
        

      

    

     

    (b) Cashless
      Exercise.
      If at
      any time after twelve (12) months from the date of issuance of this Warrant
      (i)
      there is no effective Registration Statement registering, or no current
      prospectus available for, the resale of the Warrant Shares by the Holder and
      (ii) the Per Share Market Value (as defined below) of one share of Common Stock
      is greater than the Exercise Price then in effect, then this Warrant may also
      be
      exercised at such time by means of a “cashless exercise” in which the Holder
      shall be entitled to receive a certificate for the number of Warrant Shares
      computed using the following formula: (X) = (Y) - [(A*Y)/(B)], where:


     

    
      	
              (X)

            	
              =

            	
              the
                number of Warrant Shares to be issued to the Holder;

            
	 	
               

            	 
	
              (Y)

            	
              =

            	
              the
                number of Warrant Shares purchasable upon exercise of all of the
                Warrant
                or, if only a portion of the Warrant is being exercised, the portion
                of
                the Warrant being exercised;

            
	 	 	 
	
              (A)

            	
              =

            	
              the
                Exercise Price then in effect; and

            
	 	 	 
	
              (B)

            	
              =

            	
              the
                Per Share Market Value of one share of Common
                Stock.

            


    

     

    “Per
      Share Market Value”
means
      on any particular date (a) the closing bid price per share of the Common
      Stock on such date on any registered national stock exchange on which the Common
      Stock is then listed, or if there is no such price on such date, then the
      closing bid price on such exchange or quotation system on the date nearest
      preceding such date, or (b) if the Common Stock is not listed then on any
      registered national stock exchange, the closing bid price for a share of Common
      Stock in the over-the-counter market, as reported by the OTC Bulletin Board
      or
      in the National Quotation Bureau Incorporated or similar organization or agency
      succeeding to its functions of reporting prices) at the close of business on
      such date, or (c) if the Common Stock is not then reported by the OTC
      Bulletin Board or the National Quotation Bureau Incorporated (or similar
      organization or agency succeeding to its functions of reporting prices), then
      the average of the “Pink Sheet” quotes for the five days preceding such date of
      determination, or (d) if the Common Stock is not then publicly traded the
      fair market value of a share of Common Stock as determined in good faith by
      the
      Board of Directors of the Company. 

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    (c) Holder’s
      Restrictions.
      The
      Company shall not effect any exercise of this Warrant, and a Holder shall not
      have the right to exercise any portion of this Warrant, pursuant to Section
      2(a), Section 2(b) or otherwise, to the extent that after giving effect to
      such
      issuance after exercise as set forth on the applicable Notice of Exercise,
      such
      Holder (together with such Holder’s Affiliates, and any other person or entity
      acting as a group together with such Holder or any of such Holder’s Affiliates),
      as set forth on the applicable Notice of Exercise, would beneficially own in
      excess of the Beneficial Ownership Limitation (as defined below). For purposes
      of the foregoing sentence, the number of shares of Common Stock beneficially
      owned by such Holder and its Affiliates shall include the number of shares
      of
      Common Stock issuable upon exercise of this Warrant with respect to that such
      determination is being made, but shall exclude the number of shares of Common
      Stock which would be issuable upon (A) exercise of the remaining, nonexercised
      portion of this Warrant beneficially owned by such Holder or any of its
      Affiliates and (B) exercise or conversion of the unexercised or nonconverted
      portion of any other securities of the Company (including, without limitation,
      any other Warrants) subject to a limitation on conversion or exercise analogous
      to the limitation contained herein beneficially owned by such Holder or any
      of
      its affiliates. Except as set forth in the preceding sentence, for purposes
      of
      this Section 2(c), beneficial ownership shall be calculated in accordance with
      Section 13(d) of the Exchange Act and the rules and regulations promulgated
      thereunder, it being acknowledged by a Holder that the Company is not
      representing to such Holder that such calculation is in compliance with Section
      13(d) of the Exchange Act and such Holder is solely responsible for any
      schedules required to be filed in accordance therewith. To the extent that
      the
      limitation contained in this Section 2(c) applies, the determination of whether
      this Warrant is exercisable (in relation to other securities owned by such
      Holder together with any Affiliates) and of which portion of this Warrant is
      exercisable shall be in the sole discretion of a Holder, and the submission
      of a
      Notice of Exercise shall be deemed to be each Holder’s determination of whether
      this Warrant is exercisable (in relation to other securities owned by such
      Holder together with any Affiliates) and of which portion of this Warrant is
      exercisable, in each case subject to such aggregate percentage limitation,
      and
      the Company shall have no obligation to verify or confirm the accuracy of such
      determination. In addition, a determination as to any group status as
      contemplated above shall be determined in accordance with Section 13(d) of
      the
      Exchange Act and the rules and regulations promulgated thereunder. For purposes
      of this Section 2(c), in determining the number of outstanding shares of Common
      Stock, a Holder may rely on the number of outstanding shares of Common Stock
      as
      reflected in (x) the Company’s most recent Form 10-QSB or Form 10-KSB, as the
      case may be, (y) a more recent public announcement by the Company or, if more
      recent, (z) any other notice by the Company or the Company’s Transfer Agent
      setting forth the number of shares of Common Stock outstanding. Upon the written
      or oral request of a Holder, the Company shall within two Trading Days confirm
      orally and in writing to such Holder the number of shares of Common Stock then
      outstanding. In any case, the number of outstanding shares of Common Stock
      shall
      be determined after giving effect to the conversion or exercise of securities
      of
      the Company, including this Warrant, by such Holder or its Affiliates since
      the
      date as of which such number of outstanding shares of Common Stock was reported.
      The “Beneficial
      Ownership Limitation”
shall
      be 4.99% of the number of shares of the Common Stock outstanding immediately
      after giving effect to the issuance of shares of Common Stock issuable upon
      exercise of this Warrant. The Beneficial Ownership Limitation provisions of
      this
      Section 2(c) may be waived by such Holder, at the election of such Holder,
      upon
      not less than 61 days’ prior notice to the Company to change the Beneficial
      Ownership Limitation to 9.99% of the number of shares of the Common Stock
      outstanding immediately after giving effect to the issuance of shares of Common
      Stock upon exercise of this Warrant, and the provisions of this Section 2(c)
      shall continue to apply. Upon such a change by a Holder of the Beneficial
      Ownership Limitation from such 4.99% limitation to such 9.99% limitation, the
      Beneficial Ownership Limitation may not be further waived by such Holder. The
      provisions of this paragraph shall be construed and implemented in a manner
      otherwise than in strict conformity with the terms of this Section 2(c) to
      correct this paragraph (or any portion hereof) which may be defective or
      inconsistent with the intended Beneficial Ownership Limitation herein contained
      or to make changes or supplements necessary or desirable to properly give effect
      to such limitation. The limitations contained in this paragraph shall apply
      to a
      successor holder of this Warrant. 

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    (d) Mechanics
      of Exercise.
      

     

    (i) Authorization
      of Warrant Shares.
      The
      Company covenants that all Warrant Shares that may be issued upon the exercise
      of the purchase rights represented by this Warrant will, upon exercise of the
      purchase rights represented by this Warrant, be duly authorized, validly issued,
      fully paid and nonassessable and free from all taxes, liens and charges created
      by the Company in respect of the issue thereof (other than taxes in respect
      of
      any transfer occurring contemporaneously with such issue). 

     

    (ii) Delivery
      of Certificates Upon Exercise.
      Certificates for shares purchased hereunder shall be transmitted by the Transfer
      Agent to the Holder by crediting the account of the Holder’s prime broker with
      the Depository Trust Company through its Deposit Withdrawal Agent Commission
      (“DWAC”)
      system
      if the Transfer Agent is a participant in such system and such certificates
      are
      not required to be issued with a restrictive legend, and otherwise by physical
      delivery to the address specified by the Holder in the Notice of Exercise within
      3 Trading Days from the delivery to the Company of the Notice of Exercise Form,
      surrender of this Warrant (if required) and payment of the aggregate Exercise
      Price as set forth above (“Warrant
      Share Delivery Date”).
      This
      Warrant shall be deemed to have been exercised on the date the Exercise Price
      is
      received by the Company. The Warrant Shares shall be deemed to have been issued,
      and Holder or any other person so designated to be named therein shall be deemed
      to have become a holder of record of such shares for all purposes, as of the
      date the Warrant has been exercised by payment to the Company of the Exercise
      Price (or by cashless exercise, if permitted) and all taxes required to be
      paid
      by the Holder, if any, pursuant to Section 2(d)(v) prior to the issuance of
      such
      shares, have been paid. 

     

    (iii) Delivery
      of New Warrants Upon Exercise.
      If this
      Warrant shall have been exercised in part, the Company shall, at the request
      of
      a Holder and upon surrender of this Warrant certificate, at the time of delivery
      of the certificate or certificates representing Warrant Shares, deliver to
      Holder a new Warrant evidencing the rights of Holder to purchase the unpurchased
      Warrant Shares called for by this Warrant, which new Warrant shall in all other
      respects be identical with this Warrant. 

     

    (iv) No
      Fractional Shares or Scrip.
      No
      fractional shares or scrip representing fractional shares shall be issued upon
      the exercise of this Warrant. As to any fraction of a share that a Holder would
      otherwise be entitled to purchase upon such exercise, the Company shall at
      its
      election, either pay a cash adjustment in respect of such final fraction in
      an
      amount equal to such fraction multiplied by the Exercise Price or round up
      to
      the next whole share. 

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    (v) Compensation
      for Buy-In on Failure to Timely Deliver Certificates Upon
      Exercise.
      In
      addition to any other rights available to the Holder, if the Company fails
      to
      cause its transfer agent to transmit to the Holder a certificate or certificates
      representing the Warrant Shares pursuant to an exercise on or before the Warrant
      Share Delivery Date, and if after such date the Holder is required by its broker
      to purchase (in an open market transaction or otherwise) or the Holder’s
      brokerage firm otherwise purchases, shares of Common Stock to deliver in
      satisfaction of a sale by the Holder of the Warrant Shares which the Holder
      anticipated receiving upon such exercise (a “Buy-In”),
      then
      the Company shall (1) pay in cash to the Holder the amount by which (x) the
      Holder’s total purchase price (including brokerage commissions, if any) for the
      shares of Common Stock so purchased exceeds (y) the amount obtained by
      multiplying (A) the number of Warrant Shares that the Company was required
      to
      deliver to the Holder in connection with the exercise at issue times (B) the
      price at which the sell order giving rise to such purchase obligation was
      executed, and (2) at the option of the Holder, either reinstate the portion
      of
      the Warrant and equivalent number of Warrant Shares for which such exercise
      was
      not honored or deliver to the Holder the number of shares of Common Stock that
      would have been issued had the Company timely complied with its exercise and
      delivery obligations hereunder. For example, if the Holder purchases Common
      Stock having a total purchase price of $11,000 to cover a Buy-In with respect
      to
      an attempted exercise of shares of Common Stock with an aggregate sale price
      giving rise to such purchase obligation of $10,000, under clause (1) of the
      immediately preceding sentence the Company shall be required to pay the Holder
      $1,000. The Holder shall provide the Company written notice indicating the
      amounts payable to the Holder in respect of the Buy-In and, upon request of
      the
      Company, evidence of the amount of such loss. Nothing herein shall limit a
      Holder’s right to pursue any other remedies available to it hereunder, at law or
      in equity including, without limitation, a decree of specific performance and/or
      injunctive relief with respect to the Company’s failure to timely deliver
      certificates representing shares of Common Stock upon exercise of the Warrant
      as
      required pursuant to the terms hereof.

     

    (vi) Charges,
      Taxes and Expenses.
      Issuance of certificates for Warrant Shares shall be made without charge to
      the
      Holder for any issue or transfer tax or other incidental expense in respect
      of
      the issuance of such certificate, all of which taxes and expenses shall be
      paid
      by the Company, and such certificates shall be issued in the name of the Holder
      or in such name or names as may be directed by the Holder; provided,
      however,
      that in
      the event certificates for Warrant Shares are to be issued in a name other
      than
      the name of the Holder, this Warrant when surrendered for exercise shall be
      accompanied by the Assignment Form attached hereto duly executed by the Holder;
      and the Company may require, as a condition thereto, the payment of a sum
      sufficient to reimburse it for any transfer tax incidental thereto.


     

    (vii) Closing
      of Books.
      The
      Company will not close its stockholder books or records in any manner which
      prevents the timely exercise of this Warrant, pursuant to the terms hereof.
      

     

    Section
      3. Mandatory
      Exercise.

     

    (a) At
      any
      time following the date that is two (2) years from the Initial Exercise Date,
      and provided that all of the Required Conditions (as defined below) have been
      satisfied, the Company may, upon thirty (30) days prior written notice (a
“Mandatory
      Exercise Notice”)
      to the
      Holder, cause the Holder to exercise this Warrant, in whole or in part, pursuant
      to the applicable procedures set forth in Section 2 hereof. The Mandatory
      Exercise Notice shall state what portion of the Warrant is subject to mandatory
      exercise and on what date such mandatory exercise shall take effect (the
“Mandatory
      Exercise Date”),
      which
      date shall be at least twenty (20) Business Days after the Mandatory Exercise
      Notice is delivered to Holder (the “Mandatory
      Exercise Notice Date”).
      The
      Company covenants to honor all exercises of this Warrant up until 5:00 p.m.
      (New
      York City time) on the Mandatory Exercise Date, and any such exercises will
      be
      applied against the portion of the Warrant subject to mandatory exercise. To
      the
      extent that this Warrant is not so exercised by 5:01 p.m. (New York City Time)
      on the Mandatory Exercise Date, any unexercised portion of this Warrant subject
      to mandatory exercise shall expire without any consideration due to the Holder
      and shall be of no further force or effect.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    (b) In
      the
      event that the Holder is unable to exercise the entire Warrant due to the
      limitations set forth in Section 2(c) hereof, such unexercised portion of this
      Warrant shall remain outstanding with all of the rights and privileges set
      forth
      herein. Upon the Company’s written request, the Holder shall advise the Company
      in writing the number of shares of Common Stock that are beneficially owned
      by
      such holder, not counting any Warrant Shares. Beneficial ownership shall be
      determined in accordance with the provisions of Section 2(c) hereof. If the
      shares of Common Stock beneficially owned by such holder (excluding Warrant
      Shares) amount to less than the current Beneficial Ownership Limitation, the
      Company may, at its option, compel the Holder, by delivery of a Mandatory
      Exercise Notice, to exercise such portion of this Warrant into shares of Common
      Stock such that the total number of shares of Common Stock beneficially owned
      by
      such holder after such exercise shall equal up to the current Beneficial
      Ownership Limitation, but not more. 

     

    (c) For
      purposes hereof, “Required
      Conditions”
shall
      consist of each of the following: 

     

    (i) the
      VWAP
      (as defined below) of the Common Stock for the twenty (20) consecutive trading
      days prior to delivery of the Mandatory Exercise Notice equals or exceeds $4.00
      (as adjusted for stock splits, stock dividends or similar events); 

     

    (ii) the
      average daily trading volume of the Common Stock for the twenty (20) consecutive
      trading days prior to delivery of the Mandatory Exercise Notice has been at
      least 200,000 shares; 

     

    (iii) a
      registration statement providing for the resale of all of the Warrant Shares
      subject to mandatory exercise is effective on the Mandatory Exercise Notice
      Date
      and through to and including the Mandatory Exercise Date, and the Company shall
      have no reason to believe that such registration statement will not in the
      foreseeable future continue to be in effect; and

     

    (iv) the
      Common Stock has been approved for trading on either the American Stock
      Exchange, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global
      Select Market or the New York Stock Exchange.

     

    (d) For
      purposes hereof, “VWAP”
means,
      for any date, the price determined by the first of the following clauses that
      applies: (a) if the Common Stock is then listed or quoted on a Trading Market,
      the daily volume weighted average price of the Common Stock for such date (or
      the nearest preceding date) on the Trading Market on which the Common Stock
      is
      then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day
      from
      9:30 a.m. (New York City time) to 4:02 p.m. (New York City time); (b) if the
      OTC
      Bulletin Board is not a Trading Market, the volume weighted average price of
      the
      Common Stock for such date (or the nearest preceding date) on the OTC Bulletin
      Board; (c) if the Common Stock is not then quoted for trading on the OTC
      Bulletin Board and if prices for the Common Stock are then reported in the
“Pink
      Sheets” published by Pink Sheets, LLC (or a similar organization or agency
      succeeding to its functions of reporting prices), the most recent bid price
      per
      share of the Common Stock so reported; or (d) in all other cases, the fair
      market value of a share of Common Stock as determined as determined in good
      faith by the Board of Directors of the Company.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    Section
      4. Certain
      Adjustments.
      

     

    (a) Stock
      Dividends and Splits.
      If the
      Company, at any time while this Warrant is outstanding: (A) pays a stock
      dividend or otherwise makes a distribution or distributions on shares of its
      Common Stock or any other equity or equity equivalent securities payable in
      shares of Common Stock (which, for avoidance of doubt, shall not include any
      shares of Common Stock issued by the Company upon exercise of this Warrant),
      (B)
      subdivides outstanding shares of Common Stock into a larger number of shares,
      (C) combines (including by way of reverse stock split) outstanding shares of
      Common Stock into a smaller number of shares, or (D) issues by reclassification
      of shares of the Common Stock any shares of capital stock of the Company, then
      in each case the Exercise Price shall be multiplied by a fraction of which
      the
      numerator shall be the number of shares of Common Stock (excluding treasury
      shares, if any) outstanding immediately before such event and of which the
      denominator shall be the number of shares of Common Stock outstanding
      immediately after such event and the number of shares issuable upon exercise
      of
      this Warrant shall be proportionately adjusted. Any adjustment made pursuant
      to
      this Section 4(a) shall become effective immediately after the record date
      for
      the determination of stockholders entitled to receive such dividend or
      distribution and shall become effective immediately after the effective date
      in
      the case of a subdivision, combination or re-classification. 

     

    (b) Subsequent
      Equity Sales.
      If the
      Company or any Subsidiary thereof, as applicable, at any time while this Warrant
      is outstanding, shall sell or grant any option to purchase or sell or grant
      any
      right to reprice its securities, or otherwise dispose of or issue (or announce
      any offer, sale, grant or any option to purchase or other disposition) any
      Common Stock or Common Stock Equivalents entitling any Person to acquire shares
      of Common Stock, at an effective price per share less than $1.50 (as adjusted
      for stock splits, stock dividends or similar events) (such lower price, the
      “Base
      Share Price”
and
      such issuances collectively, a “Dilutive
      Issuance”)
      (if
      the holder of the Common Stock or Common Stock Equivalents so issued shall
      at
      any time, whether by operation of purchase price adjustments, reset provisions,
      floating conversion, exercise or exchange prices or otherwise, or due to
      warrants, options or rights per share which are issued in connection with such
      issuance, be entitled to receive shares of Common Stock at an effective price
      per share which is less than $1.50 per share (as adjusted for stock splits,
      stock dividends or similar events), such issuance shall be deemed to have
      occurred for less than $1.50 per share (as adjusted for stock splits, stock
      dividends or similar events) on such date of the Dilutive Issuance), then the
      Exercise Price shall be reduced to 133% of the Base Share Price, and the number
      of Warrant Shares issuable hereunder shall be increased such that the aggregate
      Exercise Price payable hereunder, after taking into account the decrease in
      the
      Exercise Price, shall be equal to the aggregate Exercise Price prior to such
      adjustment. Such adjustment shall be made whenever such Common Stock or Common
      Stock Equivalents are issued. Notwithstanding the foregoing, no adjustments
      shall be made, paid or issued under this Section 4(b) in respect of an Exempt
      Issuance. The Company shall notify the Holder in writing, no later than the
      Trading Day following the issuance of any Common Stock or Common Stock
      Equivalents subject to this section, indicating therein the applicable issuance
      price, or applicable reset price, exchange price, conversion price and other
      pricing terms (such notice the “Dilutive
      Issuance Notice”).
      For
      purposes of clarification, whether or not the Company provides a Dilutive
      Issuance Notice pursuant to this Section 4(b), upon the occurrence of any
      Dilutive Issuance, after the date of such Dilutive Issuance the Holder is
      entitled to receive a number of Warrant Shares based upon the Base Share Price
      regardless of whether the Holder accurately refers to the Base Share Price
      in
      the Notice of Exercise.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    (c) Subsequent
      Rights Offerings.
      If the
      Company, at any time while the Warrant is outstanding, shall issue rights,
      options or warrants to all holders of Common Stock (and not to Holders)
      entitling them to subscribe for or purchase shares of Common Stock at a price
      per share less than the Per Share Market Value at the record date mentioned
      below, then the Exercise Price shall be multiplied by a fraction, of which
      the
      denominator shall be the number of shares of the Common Stock outstanding on
      the
      date of issuance of such rights or warrants plus the number of additional shares
      of Common Stock offered for subscription or purchase, and of which the numerator
      shall be the number of shares of the Common Stock outstanding on the date of
      issuance of such rights or warrants plus the number of shares which the
      aggregate offering price of the total number of shares so offered (assuming
      receipt by the Company in full of all consideration payable upon exercise of
      such rights, options or warrants) would purchase at such Per
      Share
      Market Value.
      Such
      adjustment shall be made whenever such rights or warrants are issued, and shall
      become effective immediately after the record date for the determination of
      stockholders entitled to receive such rights, options or warrants. 

     

    (d) Pro
      Rata Distributions.
      If the
      Company, at any time prior to the Termination Date, shall distribute to all
      holders of Common Stock (and not to Holders of the Warrants) evidences of its
      indebtedness or assets (including cash and cash dividends) or rights or warrants
      to subscribe for or purchase any security other than the Common Stock (which
      shall be subject to Section 4(b)), then in each such case the Exercise Price
      shall be adjusted by multiplying the Exercise Price in effect immediately prior
      to the record date fixed for determination of stockholders entitled to receive
      such distribution by a fraction of which the denominator shall be the Per Share
      Market Value determined as of the record date mentioned above, and of which
      the
      numerator shall be such Per Share Market Value on such record date less the
      then
      per share fair market value at such record date of the portion of such assets
      or
      evidence of indebtedness so distributed applicable to one outstanding share
      of
      the Common Stock as determined by the Board of Directors in good faith. In
      either case the adjustments shall be described in a statement provided to the
      Holder of the portion of assets or evidences of indebtedness so distributed
      or
      such subscription rights applicable to one share of Common Stock. Such
      adjustment shall be made whenever any such distribution is made and shall become
      effective immediately after the record date mentioned above. 

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    (e) Fundamental
      Transaction.
      If, at
      any time while this Warrant is outstanding, (A) the Company effects any merger
      or consolidation of the Company with or into another Person, (B) the Company
      effects any sale of all or substantially all of its assets in one or a series
      of
      related transactions, (C) any tender offer or exchange offer (whether by the
      Company or another Person) is completed pursuant to which holders of Common
      Stock are permitted to tender or exchange their shares for other securities,
      cash or property or (D) the Company effects any reclassification of the Common
      Stock or any compulsory share exchange pursuant to which the Common Stock is
      effectively converted into or exchanged for other securities, cash or property
      (in any such case, a “Fundamental
      Transaction”),
      then,
      upon any subsequent exercise of this Warrant, the Holder shall have the right
      to
      receive, for each Warrant Share that would have been issuable upon such exercise
      immediately prior to the occurrence of such Fundamental Transaction, at the
      option of the Holder, (a) upon exercise of this Warrant, the number of shares
      of
      Common Stock of the successor or acquiring corporation or of the Company, if
      it
      is the surviving corporation, and any additional consideration (the
“Alternate
      Consideration”)
      receivable upon or as a result of such reorganization, reclassification, merger,
      consolidation or disposition of assets by a Holder of the number of shares
      of
      Common Stock for which this Warrant is exercisable immediately prior to such
      event or (b) if the Company is acquired in an all cash transaction, cash equal
      to the value of this Warrant as determined in accordance with the Black-Scholes
      option pricing formula. For purposes of any such exercise, the determination
      of
      the Exercise Price shall be appropriately adjusted to apply to such Alternate
      Consideration based on the amount of Alternate Consideration issuable in respect
      of one share of Common Stock in such Fundamental Transaction, and the Company
      shall apportion the Exercise Price among the Alternate Consideration in a
      reasonable manner reflecting the relative value of any different components
      of
      the Alternate Consideration. If holders of Common Stock are given any choice
      as
      to the securities, cash or property to be received in a Fundamental Transaction,
      then the Holder shall be given the same choice as to the Alternate Consideration
      it receives upon any exercise of this Warrant following such Fundamental
      Transaction. To the extent necessary to effectuate the foregoing provisions,
      any
      successor to the Company or surviving entity in such Fundamental Transaction
      shall issue to the Holder a new warrant consistent with the foregoing provisions
      and evidencing the Holder’s right to exercise such warrant into Alternate
      Consideration. The terms of any agreement pursuant to which a Fundamental
      Transaction is effected shall include terms requiring any such successor or
      surviving entity to comply with the provisions of this Section 4(e) and insuring
      that this Warrant (or any such replacement security) will be similarly adjusted
      upon any subsequent transaction analogous to a Fundamental Transaction.


     

    (f) Calculations.
      All
      calculations under this Section 4 shall be made to the nearest cent or the
      nearest 1/100th of a share, as the case may be. For purposes of this Section
      4,
      the number of shares of Common Stock deemed to be issued and outstanding as
      of a
      given date shall be the sum of the number of shares of Common Stock (excluding
      treasury shares, if any) issued and outstanding. 

     

    (g) Notice
      to Holder.
      

     

    (i) Adjustment
      to Exercise Price.
      Whenever the Exercise Price is adjusted pursuant to any provision of this
      Section 4, the Company shall promptly mail to the Holder a notice setting forth
      the Exercise Price after such adjustment and setting forth a brief statement
      of
      the facts requiring such adjustment. If the Company issues a variable rate
      security, the Company shall be deemed to have issued Common Stock or Common
      Stock Equivalents at the lowest possible conversion or exercise price at which
      such securities may be converted or exercised in the case of a variable rate
      security.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    (ii) Notice
      to Allow Exercise by Holder.
      If (A)
      the Company shall declare a dividend (or any other distribution in whatever
      form) on the Common Stock; (B) the Company shall declare a special nonrecurring
      cash dividend on or a redemption of the Common Stock; (C) the Company shall
      authorize the granting to all holders of the Common Stock rights or warrants
      to
      subscribe for or purchase any shares of capital stock of any class or of any
      rights; (D) the approval of any stockholders of the Company shall be required
      in
      connection with any reclassification of the Common Stock, any consolidation
      or
      merger to which the Company is a party, any sale or transfer of all or
      substantially all of the assets of the Company, of any compulsory share exchange
      whereby the Common Stock is converted into other securities, cash or property;
      (E) the Company shall authorize the voluntary or involuntary dissolution,
      liquidation or winding up of the affairs of the Company; then, in each case,
      the
      Company shall cause to be mailed to the Holder at its last address as it shall
      appear upon the Warrant Register of the Company, at least 15 calendar days
      prior
      to the applicable record or effective date hereinafter specified, a notice
      stating (x) the date on which a record is to be taken for the purpose of such
      dividend, distribution, redemption, rights or warrants, or if a record is not
      to
      be taken, the date as of which the holders of the Common Stock of record to
      be
      entitled to such dividend, distributions, redemption, rights or warrants are
      to
      be determined or (y) the date on which such reclassification, consolidation,
      merger, sale, transfer or share exchange is expected to become effective or
      close, and the date as of which it is expected that holders of the Common Stock
      of record shall be entitled to exchange their shares of the Common Stock for
      securities, cash or other property deliverable upon such reclassification,
      consolidation, merger, sale, transfer or share exchange; provided that the
      failure to mail such notice or any defect therein or in the mailing thereof
      shall not affect the validity of the corporate action required to be specified
      in such notice. The Holder is entitled to exercise this Warrant during the
      15-day period commencing on the date of such notice to the effective date of
      the
      event triggering such notice. 

     

    Section
      5. Transfer
      of Warrant.
      

     

    (a) Transferability.
      Subject
      to compliance with any applicable securities laws and the conditions set forth
      in Section 5(d) hereof and to the provisions of Section 4.01 of the Purchase
      Agreement, this Warrant and all rights hereunder (including, without limitation,
      any registration rights) are transferable, in whole or in part, upon surrender
      of this Warrant at the principal office of the Company or its designated agent,
      together with a written assignment of this Warrant substantially in the form
      attached hereto duly executed by the Holder or its agent or attorney and funds
      sufficient to pay any transfer taxes payable upon the making of such transfer.
      Upon such surrender and, if required, such payment, the Company shall execute
      and deliver a new Warrant or Warrants in the name of the assignee or assignees
      and in the denomination or denominations specified in such instrument of
      assignment, and shall issue to the assignor a new Warrant evidencing the portion
      of this Warrant not so assigned, and this Warrant shall promptly be cancelled.
      A
      Warrant, if properly assigned, may be exercised by a new holder for the purchase
      of Warrant Shares without having a new Warrant issued. 

     

    (b) New
      Warrants.
      This
      Warrant may be divided or combined with other Warrants upon presentation hereof
      at the aforesaid office of the Company, together with a written notice
      specifying the names and denominations in which new Warrants are to be issued,
      signed by the Holder. Subject to compliance with Section 5(a), as to any
      transfer that may be involved in such division or combination, the Company
      shall
      execute and deliver a new Warrant or Warrants in exchange for the Warrant or
      Warrants to be divided or combined in accordance with such notice. 

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    (c) Warrant
      Register.
      The
      Company shall register this Warrant, upon records to be maintained by the
      Company for that purpose (the “Warrant
      Register”),
      in
      the name of the record Holder hereof from time to time. The Company may deem
      and
      treat the registered Holder of this Warrant as the absolute owner hereof for
      the
      purpose of any exercise hereof or any distribution to the Holder, and for all
      other purposes, absent actual written notice to the contrary. 

     

    (d) Transfer
      Restrictions.
      If, at
      the time of the surrender of this Warrant in connection with any transfer of
      this Warrant, the transfer of this Warrant shall not be registered pursuant
      to
      an effective registration statement under the Securities Act and under
      applicable state securities or blue sky laws, the Company may require, as a
      condition of allowing such transfer, that (i) the Holder or transferee of this
      Warrant, as the case may be, furnish to the Company a written opinion of counsel
      (which opinion shall be in form, substance and scope customary for opinions
      of
      counsel in comparable transactions) to the effect that such transfer may be
      made
      without registration under the Securities Act and under applicable state
      securities or blue sky laws, and (ii) the Holder or transferee execute and
      deliver to the Company an investment letter in form and substance acceptable
      to
      the Company and (iii) the transferee be an “accredited investor” as defined in
      Rule 501 promulgated under the Securities Act or a “qualified institutional
      buyer” as defined in Rule 144A(a) promulgated under the Securities Act.


     

    Section
      6. Miscellaneous.
      

     

    (a) No
      Rights as Shareholder Until Exercise.
      This
      Warrant does not entitle the Holder to any voting rights or other rights as
      a
      shareholder of the Company prior to the exercise hereof as set forth in Section
      2(d)(ii). 

     

    (b) Loss,
      Theft, Destruction or Mutilation of Warrant.
      The
      Company covenants that upon receipt by the Company of evidence reasonably
      satisfactory to it of the loss, theft, destruction or mutilation of this Warrant
      or any stock certificate relating to the Warrant Shares, and in case of loss,
      theft or destruction, of indemnity or security reasonably satisfactory to it
      (which, in the case of the Warrant, shall not include the posting of any bond),
      and upon surrender and cancellation of such Warrant or stock certificate, if
      mutilated, the Company will make and deliver a new Warrant or stock certificate
      of like tenor and dated as of such cancellation, in lieu of such Warrant or
      stock certificate. 

     

    (c) Saturdays,
      Sundays, Holidays, etc.
      If the
      last or appointed day for the taking of any action or the expiration of any
      right required or granted herein shall not be a Business Day, then such action
      may be taken or such right may be exercised on the next succeeding Business
      Day.


     

    (d) Authorized
      Shares.
      The
      Company covenants that during the period the Warrant is outstanding, it will
      reserve from its authorized and unissued Common Stock a sufficient number of
      shares to provide for the issuance of the Warrant Shares upon the exercise
      of
      any purchase rights under this Warrant. The Company further covenants that
      its
      issuance of this Warrant shall constitute full authority to its officers who
      are
      charged with the duty of executing stock certificates to execute and issue
      the
      necessary certificates for the Warrant Shares upon the exercise of the purchase
      rights under this Warrant. The Company will take all such reasonable action
      as
      may be necessary to assure that such Warrant Shares may be issued as provided
      herein without violation of any applicable law or regulation, or of any
      requirements of the Trading Market upon which the Common Stock may be listed.
      

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    Except
      and to the extent as waived or consented to by the Holder, the Company shall
      not
      by any action, including, without limitation, amending its certificate of
      incorporation or through any reorganization, transfer of assets, consolidation,
      merger, dissolution, issue or sale of securities or any other voluntary action,
      avoid or seek to avoid the observance or performance of any of the terms of
      this
      Warrant, but will at all times in good faith assist in the carrying out of
      all
      such terms and in the taking of all such actions as may be necessary or
      appropriate to protect the rights of Holder as set forth in this Warrant against
      impairment. Without limiting the generality of the foregoing, the Company will
      (a) not increase the par value of any Warrant Shares above the amount payable
      therefor upon such exercise immediately prior to such increase in par value,
      (b)
      take all such action as may be necessary or appropriate in order that the
      Company may validly and legally issue fully paid and nonassessable Warrant
      Shares upon the exercise of this Warrant and (c) use commercially reasonable
      efforts to obtain all such authorizations, exemptions or consents from any
      public regulatory body having jurisdiction thereof as may be necessary to enable
      the Company to perform its obligations under this Warrant. 

     

    Before
      taking any action that would result in an adjustment in the number of Warrant
      Shares for which this Warrant is exercisable or in the Exercise Price, the
      Company shall obtain all such authorizations or exemptions thereof, or consents
      thereto, as may be necessary from any public regulatory body or bodies having
      jurisdiction thereof. 

     

    (e) Governing
      Law.
      This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of New York without giving effect (to the extent permitted by law) to
      any
      choice or conflict of law provision or rule (whether of the State of New York
      or
      any other jurisdiction) that would cause the application of the laws of any
      jurisdiction other than the State of New York 

     

    (f) Construction.
      All
      questions concerning the construction, validity, enforcement and interpretation
      of this Warrant shall be determined in accordance with the provisions of the
      Purchase Agreement. 

     

    (g) Restrictions.
      The
      Holder acknowledges that the Warrant Shares acquired upon the exercise of this
      Warrant, if not registered, will have restrictions upon resale imposed by state
      and federal securities laws. 

     

    (h) Nonwaiver
      and Expenses.
      No
      course of dealing or any delay or failure to exercise any right hereunder on
      the
      part of Holder shall operate as a waiver of such right or otherwise prejudice
      Holder’s rights, powers or remedies, notwithstanding the fact that all rights
      hereunder terminate on the Termination Date. If the Company willfully and
      knowingly fails to comply with any provision of this Warrant, that results
      in
      any material damages to the Holder, the Company shall pay to Holder such amounts
      as shall be sufficient to cover any costs and expenses including, but not
      limited to, reasonable attorneys’ fees, including those of appellate
      proceedings, incurred by Holder in collecting any amounts due pursuant hereto
      or
      in otherwise enforcing any of its rights, powers or remedies hereunder.


     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    (i) Notices.
      Any
      notice, request or other document required or permitted to be given or delivered
      to the Holder by the Company shall be delivered in accordance with the notice
      provisions of the Purchase Agreement. 

     

    (j) Limitation
      of Liability.
      No
      provision hereof, in the absence of any affirmative action by Holder to exercise
      this Warrant to purchase Warrant Shares, and no enumeration herein of the rights
      or privileges of Holder, shall give rise to any liability of Holder for the
      purchase price of any Common Stock or as a stockholder of the Company, whether
      such liability is asserted by the Company or by creditors of the Company.


     

    (k) Successors
      and Assigns.
      Subject
      to applicable securities laws, this Warrant and the rights and obligations
      evidenced hereby shall inure to the benefit of and be binding upon the
      successors of the Company and the successors and permitted assigns of Holder.
      The provisions of this Warrant are intended to be for the benefit of all Holders
      from time to time of this Warrant and shall be enforceable by any such Holder
      or
      holder of Warrant Shares. 

     

    (l) Amendment.
      This
      Warrant may be modified or amended or the provisions hereof waived with the
      written consent of the Company and the Holder. 

     

    (m) Severability.
      Wherever possible, each provision of this Warrant shall be interpreted in such
      manner as to be effective and valid under applicable law, but if any provision
      of this Warrant shall be prohibited by or invalid under applicable law, such
      provision shall be ineffective to the extent of such prohibition or invalidity,
      without invalidating the remainder of such provisions or the remaining
      provisions of this Warrant. 

     

    (n) Headings.
      The
      headings used in this Warrant are for the convenience of reference only and
      shall not, for any purpose, be deemed a part of this Warrant. 

     

    ********************
      

     

    IN
      WITNESS WHEREOF, the Company has caused this Warrant to be executed by its
      officer thereunto duly authorized as of the date first above indicated.


     

    
      	 	 	 
	 	CHINA
              CLEAN ENERGY INC.
	 
 	 
 	 
 
	 	By:  	 
	 	
              

              Name:
                Gary Zhao

              Title:
                Chief Financial Officer

            
	 	 


    

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    NOTICE
      OF EXERCISE

     

    
      	TO:	
              China
                Clean Energy Inc. 

              
                c/o
                  Fujian Zhongde Technology Co., Ltd.

                Fulong
                  Industrial Zone

                Longtian
                  Town Fuqing City

                Fujian,
                  People’s Republic of China 35013

                Attention:
                  Chief Financial Officer

                Tel.
                  No.: +86-591-85773387

                Fax
                  No.: +86-591-28397168 

              

            


    

     

    (1) 
      The
      undersigned hereby elects to purchase ______________ Warrant Shares of the
      Company pursuant to the terms of the attached Class A Common Stock Purchase
      Warrant, and tenders herewith payment of the exercise price in full, together
      with all applicable transfer taxes, if any. 

     

    (2) Payment
      shall take the form of (check applicable box): 

     

    
      	
            	o	
              in
                lawful money of the United States;
                or

            


    

     

    
      	
            	o	
              if
                permitted, the cancellation of __________ Warrant Shares in order
                to
                exercise this Warrant with respect to ____________ Warrant Shares
                (using a
                Per Share Market Value of $______ for this calculation), in accordance
                with the formula and procedure set forth in subsection
                2(b).

            


    

     

    
      	
            	o	
              if
                permitted, the cancellation of such number of Warrant Shares as is
                necessary, in accordance with the formula and procedure set forth
                in
                subsection 2(b), to exercise this Warrant with respect to the maximum
                number of Warrant Shares purchasable pursuant to a cashless exercise.
                

            


    

     

    (3) Please
      issue a certificate or certificates representing said Warrant Shares in the
      name
      of the undersigned or in such other name as is specified below: 

     

      
        

      

    

     

    The
      Warrant Shares shall be delivered to the following DWAC Account Number, if
      permitted, or by physical delivery of a certificate to: 

     

      

      

    

     

    
      
 

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (4) Accredited
      Investor.
      The
      undersigned is an “accredited investor” as defined in Regulation D promulgated
      under the Securities Act of 1933, as amended. 

     

    [SIGNATURE
      OF HOLDER] 

     

    
      	Name
              of
              Investing Entity:  	 


    

    
       

      
        	Signature
                of Authorized Signatory of Investing
                Entity:  	 


      

      
         

        
          	Name
                  and
                  Title of Authorized Signatory:  	 


        

        
           

          
            	Date:
                    	 


          

           

          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

        

      

    

     

    ASSIGNMENT
      FORM 

     

    (To
      assign the foregoing warrant, execute

    this
      form
      and supply required information.

    Do
      not
      use this form to exercise the warrant.)

     

    FOR
      VALUE
      RECEIVED, all of or ____ shares
      of
      the foregoing Warrant and all rights evidenced thereby are hereby assigned
      to


     

                                                                      
       
      whose
      address is

     

                                                                            
                            


     

                                                                      
                              


    Dated:                      
      ,
              

    
       

      
        	Holder’s
                Name:  	 


      

      
        
          
             

            
              	Holder’s
                      Signature:  	 


            

            
               

            

          

        

      

    

    
      
        
          	Name
                  and
                  Title of Signatory:  	 


        

        
           

        

      

    

    
      
        
          	Holder’s
                  Address:  	 


        

        
          
            
               

              
                	Signature
                        Guaranteed:  	 


              

              
                 

              

            

          

        

      

    

     

    NOTE:
      The
      signature to this Assignment Form must correspond with the name as it appears
      on
      the face of the Warrant, without alteration or enlargement or any change
      whatsoever, and must be guaranteed by a bank or trust company. Officers of
      corporations and those acting in a fiduciary or other representative capacity
      should file proper evidence of authority to assign the foregoing
      Warrant.