Dragon Acquisition Corporation - Exhibit 10.2 - Filed by newsfilecorp.com






Exhibit 10.2 

MAKE GOOD ESCROW AGREEMENT

          This
Make Good Escrow Agreement (the “Agreement”), dated as of April 14, 2010, is
entered into by and among Dragon Acquisition Corporation, a Cayman Islands
company (the “Company”), Access America Investments, LLC, as representative of
the Investors (the “Investor Representative”), Longhai Holdings Company Limited
(the “Make Good Shareholder”) and Collateral Agents, LLC, a New York limited
liability company, with its address at 111 West 57th Street, Suite
1416, New York, New York 10019 (hereinafter referred to as the “Escrow Agent”).
All capitalized terms used in this Agreement and not otherwise defined herein
shall have the respective meanings assigned them in the Subscription Agreement,
between the Company and each investor signatory thereto (each, an “Investor” and
collectively, the “Investors”), dated April 14, 2010 (the “Subscription
Agreement”). 

BACKGROUND 

          WHEREAS,
the Company is selling investment units (“Units”), each Unit consisting of (i)
one (1) of the Company’s 6% Convertible Preference Shares, par value $0.002112
per share, convertible into one (1) of the Company’s ordinary shares, par value
$0.002112 per share (the “Ordinary Shares”), and (ii) one (1) warrant to
purchase one-half of one of the Ordinary Shares, at a per share exercise price
of $6.00 (or two half-shares for $3.00 each). As an inducement to the Investors
to enter into the Subscription Agreement, the Make Good Shareholder has agreed
to place the Escrow Shares (as defined below) into escrow for the benefit of the
Investors in the event the Company fails to satisfy the Performance Thresholds
(as defined below). Pursuant to the terms of the Offering, the Company, the Make
Good Shareholder and the Investor Representative have agreed to establish an
escrow account (the “Escrow Account”) on the terms and conditions set forth in
this Agreement and the Escrow Agent has agreed to act as escrow agent pursuant
to the terms and conditions of this Agreement; and 

          WHEREAS,
such Offering is in connection with the combination (the “Combination”) of
Leewell Investment Group Limited (“Leewell”) and Dragon Acquisition Corporation,
a company incorporated under the laws of the Cayman Islands (“Dragon”). The
closing of the Combination is conditioned upon all of the conditions of the
Offering being met, and the Offering is conditioned upon the closing of the
Combination (the “Closing”). Leewell owns 100% of the issued and outstanding
capital stock of Qingdao Oumei Real Estate Development Co., Ltd. (“Qingdao
Oumei”), a company incorporated under the laws of the People’s Republic of China
(“China” or the “PRC”). Pursuant to the Combination, Leewell and Qingdao Oumei
will become wholly-owned subsidiaries of Dragon. 

AGREEMENT 

          NOW,
THEREFORE, in consideration of the mutual promises of the parties and the
terms and conditions hereof, the parties hereby agree as follows:

          1.     
  Appointment of Investor Representative. The Investors hereby
appoint the Investor Representative to act on their collective behalf with
respect to all matters within the scope of this Agreement, and the Investor
Representative hereby accepts such appointment. All decisions of the Investor
Representative with respect to the subject matter of this Agreement shall be
binding on the Investors absent fraud or willful misconduct. 

          2.     
  Appointment of Escrow Agent. The Investor Representative, the
Make Good Shareholder and the Company hereby appoint Escrow Agent as escrow
agent to act in accordance with the terms and conditions set forth in this
Agreement, and the Escrow Agent hereby accepts such appointment and agrees to
establish the Escrow Account on the terms and subject to the conditions
hereinafter set forth. 




          3.    
   Establishment of Escrow. Within three (3) trading days
following the Closing, the Make Good Shareholder shall deliver to the Escrow
Agent stock certificates evidencing in aggregate 7,500,000 Ordinary Shares,
which shares shall be issued to the Make Good Shareholder upon completion of the
Combination (collectively, the “Escrow Shares”) along with stock powers executed
in blank, signature medallion guaranteed or in other form and substance
acceptable for transfer, to be held in escrow pursuant to the terms and
conditions of this Agreement. Notwithstanding the foregoing transfer, the Make
Good Shareholder shall have the right to vote the Escrow Shares until such time
as they are eligible for transfer to the Investors pursuant to the terms of this
Agreement. The Make Good Shareholder hereby irrevocably agrees that, other than
in accordance with this Make Good Escrow Agreement, the Make Good Shareholder
will not offer, pledge, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right or
warrant to purchase or otherwise transfer or dispose of, directly or indirectly,
or announce the offering of any of the Escrow Shares (including any securities
convertible into, or exchangeable for, or representing the rights to receive
Escrow Shares). The Escrow Agent shall notify the Investor Representative when
the Escrow Shares have been deposited with the Escrow Agent.

          4.    
   Representations of the Make Good Shareholder. The Make Good
Shareholder (as to its Escrow Shares) hereby represents and warrants to the
Investors and the Investor Representative as follows: 

                
     4.1      The Escrow
Shares are validly issued, fully paid and nonassessable shares of the Company.
The Make Good Shareholder is the record and beneficial owner of the Escrow
Shares and has good title to the Escrow Shares, free and clear of all pledges,
liens, claims and encumbrances, except encumbrances created by this Agreement
and the Lock-Up Agreement entered into with the Make Good Shareholder. There are
no restrictions on the ability of the Make Good Shareholder to transfer the
Escrow Shares to the Investors, except as stated herein. There are no
restrictions on the ability of the Make Good Shareholder to enter into this
Agreement other than transfer restrictions under applicable federal and state
securities laws. Upon any delivery of Escrow Shares to the Investor
Representative or the Investors hereunder, the Investor Representative or
Investors will acquire good and valid title to the Escrow Shares, free and clear
of any pledges, liens, claims and encumbrances. The performance of this
Agreement and compliance with the provisions hereof will not violate any
provision of any applicable law and will not conflict with or result in any
breach of any of the terms, conditions or provisions of, or constitute a default
under, or result in the creation or imposition of any lien, charge or
encumbrance upon, any of the properties or assets of the Make Good Shareholder
pursuant to the terms of the certificate of incorporation or Memorandum and
Articles of Association of the Company or any indenture, mortgage, deed of trust
or other agreement or instrument binding upon the Make Good Shareholder or
affecting the Escrow Shares. No notice to, filing with, or authorization,
registration, consent or approval of any governmental authority or other person
is necessary for the execution, delivery or performance of this Agreement or the
consummation of the transactions contemplated hereby by the Make Good
Shareholder.

                   
  4.2      The Make Good Shareholder has
carefully considered and understands its obligations and rights in connection
with this Agreement and the transactions pursuant to which this Agreement is a
part, and in furtherance thereof (x) have consulted with legal and other
advisors with respect thereto and (y) hereby forever waive and agree that the
Make Good Shareholder may not asset any equitable defenses in any proceeding
involving the Escrow Shares. 

          5.      
 Disbursement of Escrow Shares.

                   
  5.1      For purposes of this Agreement,
“After Tax Net Income” means net income as defined under United States generally
accepted accounting principles (“GAAP”), consistently applied, for the Company,
except that the Company’s After Tax Net Income shall be increased by any
non-cash charges incurred as a result of the Offering (due to non-cash
amortization on warrants and loss from change in fair value of the Warrants
charged to the Company’s results of operation, if any, and if and to the extent previously subtracted in the calculation of After Tax Net
Income in accordance with GAAP). The Company’s After Tax Net Income for the
fiscal year ending December 31, 2010 (“FY10”) and the fiscal year ending
December 31, 2011 (“FY11”) shall also be increased by any cash and non-cash
charges related to the Share Exchange Agreement dated April 14, 2010, by and
among Dragon, Leewell, the sole shareholder of Leewell and such shareholder’s
sole shareholder, and this Offering, including but not limited to the following:
attorney’s fees, professional fees, consulting fees, EDGAR filing fees, auditing
fees and any liquidated damages pursuant to Section 8.1 of the Subscription
Agreement. Notwithstanding the foregoing or anything else to the contrary
herein, for purposes of determining whether or not any of the Performance
Thresholds (as defined below) have been met, the release of any of the Escrow
Shares to the Make Good Shareholder as a result of the operation of this
Section 5 and any related expense recorded under GAAP, shall not be
deemed to be an expense, charge, or any other deduction from revenues even
though GAAP may require contrary treatment or the annual report for the
respective fiscal years filed with the Securities and Exchange Commission by the
Company may report otherwise. For purposes hereof, “Earnings Per Share”
shall mean the Company’s After Tax Net Income (for the relevant fiscal year)
divided by the weighted average number of Ordinary Shares of the Company
outstanding at the end of the calculation period, adjusted for any stock splits,
stock combinations, stock dividends or similar transactions, and for shares
issued in any offerings or pursuant to the exercise of any warrants, options, or
other securities issued by the Company during or prior to the calculation period
and calculated on a fully diluted basis.


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    5.2      The Company has
established the following financial performance thresholds (each a “Performance
Threshold” and collectively, the “Performance Thresholds”): (i) $40,000,000 of
After Tax Net Income for FY10 (the “FY10 ATNI Threshold”) and $1.13 Earnings Per
Share for FY10 (the “2010 EPS”), and (ii) $60,000,000 of After Tax Net Income
(the “FY11 ATNI Threshold”) and $1.70 Earnings Per Share for FY11 (the “2011
EPS”). The FY10 ATNI Threshold and FY11 ATNI Threshold are each referred to as
an “ATNI Threshold” and the 2010 EPS and the 2011 EPS are each referred to as an
“EPS Threshold.” The Company will provide the Investor Representative with its
audited financial statements for FY10 and FY11, prepared in accordance with US
GAAP, on or before June 30, 2010 and April 30, 2011, respectively (each, a “Due
Date”). 

                
     5.3      If for any one
of FY10 or FY11 the Company achieves less than 90% of the applicable ANTI
Threshold or EPS Threshold, respectively, then the applicable Performance
Threshold will be deemed not to have been achieved and an amount of Escrow
Shares equal to the product of (A) the percentage difference between the
applicable Performance Threshold and actual performance (if both applicable
Performance Thresholds have not been achieved, then the applicable Performance
Threshold yielding the greater difference from actual performance shall be used)
times (B) the total number of Escrow Shares, shall be forfeited by the Make Good
Shareholder and delivered by the Escrow Agent to the Investors (pro rata based
on the number of Units purchased by each Investor in the Offering as shown on
Exhibit A) in accordance with the procedure set forth in this Section 5.


                  
   5.4      Within five (5) days of
the applicable Due Date, the Investor Representative shall determine if the
respective Performance Thresholds have been met (each a “Performance Threshold
Determination”). Within five (5) days of the Performance Threshold
Determination, the Investor Representative shall notify in writing the Make Good
Shareholder and the Company of its determination. 

                  
   5.5      If a Performance
Threshold has not been met (“Negative Threshold Determination”), then within
five (5) days of such Negative Threshold Determination, the Investor
Representative shall provide written instructions to the Escrow Agent
(“Instruction letter”), with copies to the Company and the Make Good
Shareholder, instructing the Escrow Agent to transfer the applicable portion of
Escrow Shares in accordance with the instructions set forth in the Instruction
Letter. Within ten (10) business days following actual receipt of the
Instruction Letter, the Escrow Agent shall make such delivery to the Investors if no objection is received from the
Make Good Shareholder and provided that it has received such certificates from
the Company’s transfer agent, evidencing the Investor’s pro rata portion of the
Escrow Shares. If any Escrow Shares are distributed to Investors resulting from
the Company not attaining either the FY10 ATNI Threshold or the 2010 EPS, the
Make Good Shareholder will place an additional amount of Ordinary Shares into
the Escrow Account so that the Escrow Shares total 7,500,000 shares. 

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     5.6      If any Escrow
Shares remain in the Escrow Account after the Investor Representative has had
the opportunity to evaluate whether or not the Company has attained the FY11
ATNI Threshold or the 2011 EPS, then all of the Escrow Shares remaining in the
Escrow Account shall be delivered to the Make Good Shareholder, and the Investor
Representative shall provide written instructions to the Escrow Agent
instructing the Escrow Agent to deliver the Escrow Shares back to the Make Good
Shareholder within ten (10) business days following delivery of the financial
statements for FY11 to the Investor Representative. 

                
     5.7      In the
event that any Escrow Shares are to be delivered to the Investors pursuant to
this Section 5, the Make Good Shareholder and the Company shall use its
best efforts to promptly cause the Escrow Shares to be delivered to the
Investors, including causing its transfer agent (including the Escrow Agent)
promptly to issue the certificates in the names of the Investors and causing its
securities counsel to provide any written instruction required by its transfer
agent or the Escrow Agent in a timely manner so that the issuances and delivery
contemplated above can be achieved within ten (10) business days following
delivery of the applicable financial statements to the Investor Representative.


                 
    The Escrow Agent shall not take any action which could
impair Investors’ rights in the Escrow Shares. The Escrow Agent shall not sell,
transfer, assign or otherwise dispose of (by operation of law or otherwise) or
grant any option with respect to any Escrow Shares prior to the termination of
this Agreement. 

                
     5.8      Notwithstanding
anything to the contrary herein, those Investors that became holders of Ordinary
Shares pursuant to the Offering shall be entitled to their pro rata portion of
the Escrow Shares at the time of any distribution of Escrow Shares, regardless
of whether they have subsequently transferred their Ordinary Shares; provided,
however, if an Investor has entered into a written agreement evidencing such
Investor’s transfer and assignment of all its rights and obligations under this
Agreement, and has provided written notice to the Company, Investor
Representative, and the Escrow Agent of such transfer in accordance with
Section 12 below (a “Notice of Transfer”), then in the event that any
Escrow Shares are to be delivered to the Investors in accordance with this
Section 5, the Company shall direct its transfer agent to issue the
certificates in the names of the transferee(s) and the Escrow Shares shall be
delivered by the Escrow Agent to the transferee(s) as set forth in the
Investor’s Notice of Transfer.

          6.       
Duration. This Agreement shall terminate on the distribution of all the
Escrow Shares in accordance with Section 5 above. 

          7.      
 Interpleader. Should any controversy arise among the parties hereto
with respect to this Agreement or with respect to the right to receive the
Escrow Shares, the Escrow Agent shall have the right to consult counsel and/or
to institute an appropriate interpleader action to determine the rights of the
parties. The Escrow Agent is also hereby authorized to institute an appropriate
interpleader action upon receipt of a written letter of direction executed by
the parties so directing Escrow Agent. If the Escrow Agent is directed to
institute an appropriate interpleader action, it shall institute such action not
prior to thirty (30) days after receipt of such letter of direction and not
later than sixty (60) days after such date. Any interpleader action instituted
in accordance with this Section 7 shall be filed in any court of
competent jurisdiction in New York, New York, and the Escrow Shares in dispute
shall be deposited with the court and in such event Escrow Agent shall be relieved of and discharged
from any and all obligations and liabilities under and pursuant to this
Agreement with respect to the Escrow Shares. 

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          8.      
 Exculpation and Indemnification of Escrow Agent.

                
     8.1      The Escrow
Agent acts under this Agreement as a depositary only and is not responsible or
liable in any manner whatsoever for the sufficiency, correctness, genuineness or
validity of the subject matter of the escrow, or any part thereof, or for the
form or execution of any notice given by any other party hereunder, or for the
identity or authority of any person executing any such notice. The Escrow Agent
will have no duties or responsibilities other than those expressly set forth
herein. The Escrow Agent will be under no liability to anyone by reason of any
failure on the part of any party hereto (other than the Escrow Agent) or any
maker, endorser or other signatory of any document to perform such person’s or
entity’s obligations hereunder or under any such document. Except for this
Agreement and instructions to the Escrow Agent pursuant to the terms of this
Agreement, the Escrow Agent will not be obligated to recognize any agreement
between or among any or all of the persons or entities referred to herein,
notwithstanding its knowledge thereof. The Escrow Agent shall not be required to
expend or risk any of its own funds or otherwise incur any liability, financial
or otherwise, in the performance of any of its duties hereunder.

                
     8.2      The Escrow
Agent will not be liable for any action taken or omitted by it, or any action
suffered by it to be taken or omitted, in good faith and in the exercise of its
own best judgment, and may rely conclusively on, and will be protected in acting
upon, any order, notice, demand, certificate, or opinion or advice of counsel
(including counsel chosen by the Escrow Agent), statement, instrument, report or
other paper or document (not only as to its due execution and the validity and
effectiveness of its provisions, but also as to the truth and acceptability of
any information therein contained) which is reasonably believed by Escrow Agent
to be genuine and to be signed or presented by the proper person or persons. The
duties and responsibilities of the Escrow Agent hereunder shall be determined
solely by the express provisions of this Agreement and no other or further
duties or responsibilities shall be implied, including, but not limited to, any
obligation under or imposed by any laws of the State of New York upon
fiduciaries.

                
     8.3      The Company
and the Make Good Shareholder, jointly and severally, hereby indemnify and hold
harmless, the Escrow Agent by from and against any expenses, including
reasonable attorneys’ fees and disbursements, damages or losses suffered by the
Escrow Agent in connection with any claim or demand, which, in any way, directly
or indirectly, arises out of or relates to this Agreement or the services of
Escrow Agent hereunder; except, that if the Escrow Agent is guilty of willful
misconduct, fraud or gross negligence under this Agreement, then the Escrow
Agent will bear all losses, damages and expenses arising as a result of such
willful misconduct, fraud or gross negligence. Promptly after the receipt by the
Escrow Agent of notice of any such demand or claim or the commencement of any
action, suit or proceeding relating to such demand or claim, the Escrow Agent
will notify the other parties hereto in writing. For the purposes hereof, the
terms “expense” and “loss” will include all amounts paid or payable to satisfy
any such claim or demand, or in settlement of any such claim, demand, action,
suit or proceeding settled with the express written consent of the parties
hereto, and all costs and expenses, including, but not limited to, reasonable
attorneys’ fees and disbursements, paid or incurred in investigating or
defending against any such claim, demand, action, suit or proceeding. The
provisions of this Section 8.3 shall survive the termination of this
Agreement.

                
     8.4      If at any time
the Escrow Agent is served with any judicial or administrative order, judgment,
decree, writ or other form of judicial or administrative process which in any
way affects the Escrow Shares (including but not limited to orders of attachment
or garnishment or other forms of levies or injunctions or stays relating to the
transfer of the Escrow Shares ) (an “Order”), the Escrow Agent is authorized to comply therewith in any manner it or legal
counsel of its own choosing deems appropriate, provided, that the Escrow
Agent shall immediately provide notice to the Company, the Placement Agent, and
the Investor Representative of such Order, and, to the extent permitted under
the Order, shall defer compliance with the Order until the Company, the
Placement Agent, and the Investor Representative have had an opportunity to
dispute, appeal, or otherwise challenge such Order. If the Escrow Agent complies
with any such Order after complying with all other requirements under this
Section 8.4, Escrow Agent shall not be liable to any of the parties hereto or to
any other person or entity even though such Order may be subsequently modified
or vacated or otherwise determined to have been without legal force or effect. 

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     8.5      The Escrow
Agent shall not incur any liability for not performing any act or fulfilling any
duty, obligation or responsibility hereunder by reason of any occurrence beyond
the control of the Escrow Agent (including but not limited to any act or
provision of any present or future law or regulation or governmental authority,
any act of God or war, civil unrest, local or national disturbance or disaster,
any act of terrorism, or the unavailability of the Federal Reserve Bank wire or
facsimile or other wire or communication facility), except to the extent that it
failed to act reasonably to avoid or restrict the effect of any such occurrence
on its duties, obligations, and responsibilities hereunder. 

                
     8.6      The Escrow Agent
shall not be called upon to advise any party as to the wisdom in selling or
retaining or taking or refraining from any action with respect to any securities
or other property deposited hereunder. 

                
     8.7      When the Escrow
Agent acts on any information, instructions, communications (including, but not
limited to, communications with respect to the delivery of securities or the
wire transfer of funds) sent by telex, facsimile, email or other form of
electronic or data transmission, the Escrow Agent, absent gross negligence,
shall not be responsible or liable in the event such communication is not an
authorized or authentic communication (whether due to fraud, distortion or
otherwise). In the event of any ambiguity or uncertainty hereunder or in any
notice, instruction or other communication received by the Escrow Agent
hereunder, the Escrow Agent may, in its sole discretion, refrain from taking any
action other than to retain possession of the Escrow Shares, unless the Escrow
Agent receives written instructions, signed by the Investor Representative and
Make Good Shareholder which eliminates such ambiguity or uncertainty. 

                
     8.8      The Escrow Agent
does not have any interest in the Escrow Shares deposited hereunder but is
serving as escrow holder only and having only possession thereof. The Company
shall pay or reimburse the Escrow Agent upon request for any transfer taxes or
other taxes relating to the Escrow Shares that are incurred and are required to
be incurred pursuant to the terms and provisions of this Agreement and shall
indemnify and hold harmless the Escrow Agent from any amounts that it is
obligated to pay in the way of such taxes. Any payments of income from this
Escrow Account shall be subject to withholding regulations then in force with
respect to United States taxes. The Company will provide the Escrow Agent with
appropriate W-9 forms for tax identification number certifications, or W-8 forms
for non-resident alien certifications. It is understood that the Escrow Agent
shall only be responsible for income reporting with respect to income earned on
the Escrow Shares and will not be responsible for any other reporting. This
paragraph shall survive notwithstanding any termination of this Agreement or the
resignation or removal of the Escrow Agent. 

                
     8.9      Escrow Agent may
generally engage in any kind of business with the Company, the Investor
Representative, the Make Good Shareholder or any participant in the Offering or
any subsidiary or affiliate thereof as if it had not entered into this Agreement
or any other agreement with them. Escrow Agent and its affiliates and their
officers, directors, employees, and agents (including legal counsel) may now or
hereafter be engaged in one or more transactions with the Company, the Investor
Representative, the Make Good Shareholder or any participant in the Offering or
any subsidiary or affiliate thereof or may act as trustee, agent or representative of
either the foregoing parties or otherwise be engaged in other transactions with
such parties (collectively, the “Other Activities”). Without limiting the
foregoing, Escrow Agent and its affiliates and their officers, directors,
employees, and agents (including legal counsel) shall not be responsible to
account to the Company, the Investor Representative, the Make Good Shareholder
or any participant in the Offering or any subsidiary or affiliate thereof for
such Other Activities. 

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          9.       
Fees and Expenses. The Escrow Agent shall be entitled to payment of the
following fees for the services rendered hereunder: 

                
     9.1      Documentation
Fee. The Company shall pay a $2,500 documentation fee to the Escrow Agent on
the Closing Date. 

                
     9.2      Delivery
Fee. The Company shall pay a fee of $500 to the Escrow Agent each time
during the term of the Agreement in which the Escrow Agent delivers any of the
Escrow Shares. 

In addition, the Company agrees to pay the Escrow Agent’s costs
and expenses including reasonable attorney’s fees in the event of any dispute or
litigation threatened or commenced which requires the Escrow Agent in its
opinion to refer such matter to its attorneys and all wire fees, packaging and
postal fees and expenses (including FedEx). Escrow Agent will incur no liability
for any delay reasonably required to obtain such advice of counsel.

          10.      Resignation
of Escrow Agent. At any time, upon ten (10) days’ written notice to the
Company, Investor Representative and the Make Good Shareholder, the Escrow Agent
may resign and be discharged from its duties as escrow agent hereunder. As soon
as practicable after its resignation, the Escrow Agent will promptly turn over
to a successor escrow agent appointed by the Company the Escrow Shares held
hereunder upon presentation of a document appointing the new escrow agent and
evidencing its acceptance thereof. If, by the end of the 10-day period following
the giving of notice of resignation by the Escrow Agent, the Company shall have
failed to appoint a successor escrow agent, the Escrow Agent may interplead the
Escrow Shares into the registry of any court having jurisdiction.

          11.     
Records. The Escrow Agent shall maintain accurate records of all
transactions hereunder. Promptly after the termination of this Agreement or as
may reasonably be requested by the parties hereto from time to time before such
termination, the Escrow Agent shall provide the parties hereto, as the case may
be, with a complete copy of such records, certified by the Escrow Agent to be a
complete and accurate account of all such transactions. The authorized
representatives of each of the parties hereto shall have access to such books
and records at all reasonable times during normal business hours upon reasonable
notice to the Escrow Agent.

          12.      Notice.
All notices, communications and instructions required or desired to be given
under this Agreement must be in writing and shall be deemed to be duly given if
sent by registered or certified mail, return receipt requested, or overnight
courier to the following addresses:

                     
If to Escrow Agent: 

Collateral Agents, LLC 
111 West
57th Street, Suite 1416 
New York, NY 10019 
Attn: General Counsel


  Fax: (212) 245-9101 

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If to the Company or the Make Good Shareholder: 

Dragon Acquisition Corporation

Shandong Motorway Building 
29 Miaoling Road
Qingdao 266000


  People’s Republic of China

                
With copies to: 

Pillsbury Winthrop Shaw Pittman LLP

2300 N Street NW
Washington, D.C. 20037
Facsimile:
202.663.8007

  Attn.: Louis A. Bevilacqua, Esq.

                
If to the Investor Representative: 

Access America Investments, LLC

11200 Westheimer Rd., Suite 508 
Houston, Texas 77042 

  Attention: Christopher Efird, President 

or to such other address and to the attention of such other
person as any of the above may have furnished to the other parties in writing
and delivered in accordance with the provisions set forth above.

          13.     
Execution in Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. Facsimile execution and
delivery of this Agreement is legal, valid and binding for all purposes.

          14.     
Assignment and Modification. This Agreement and the rights and
obligations hereunder of the Company may be assigned by the Company only
following the prior written consent of Investors holding a majority of the Units
issued at Closing under the Subscription Agreement. This Agreement and the
rights and obligations hereunder of the Escrow Agent may be assigned by the
Escrow Agent only with the prior consent of the Company and the Investor
Representative. This Agreement and the rights and obligations hereunder of the
Make Good Shareholder may not be assigned by the Make Good Shareholder. Subject
to the requirements under federal and state securities laws, an Investor may
assign its rights under this Agreement without any consent from any other party.
This Agreement may not be changed orally or modified, amended or supplemented
without an express written agreement executed by the Escrow Agent, the Company,
the Make Good Shareholder and the Investor Representative (upon consent of the
Investors holding a majority of the Units issued at Closing under the
Subscription Agreement. This Agreement is binding upon and intended to be for
the sole benefit of the parties hereto and their respective successors, heirs
and permitted assigns, and none of the provisions of this Agreement are intended
to be, nor shall they be construed to be, for the benefit of any third person.
No portion of the Escrow Shares shall be subject to interference or control by
any creditor of any party hereto, or be subject to being taken or reached by any
legal or equitable process in satisfaction of any debt or other liability of any
such party hereto prior to the disbursement thereof to such party hereto in
accordance with the provisions of this Agreement.

          15.      Applicable
Law. This Agreement shall be governed by and construed with the laws of the
State of New York applicable to contracts made and to be performed therein. Any
litigation concerning the subject matter of this Agreement shall be exclusively
prosecuted in the state or federal courts located in New York, New York, and all
parties consent to the excusive jurisdiction and venue of those courts.

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          16.      Headings.
The headings contained in this Agreement are for convenience of reference only
and shall not affect the construction of this Agreement.

          17.     
Merger or Consolidation. Any corporation or association into which the
Escrow Agent may be converted or merged, or with which it may be consolidated,
or to which it may sell or transfer all or substantially all of its corporate
trust business and assets as a whole or substantially as a whole, or any
corporation or association resulting from any such conversion, sale, merger,
consolidation or transfer to which the Escrow Agent is a party, shall be and
become the successor escrow agent under this Agreement and shall have and
succeed to the rights, powers, duties, immunities and privileges as its
predecessor, without the execution or filing of any instrument or paper or the
performance of any further act. 

          18.      Attorneys’
Fees. If any action at law or in equity, including an action for declaratory
relief, is brought to enforce or interpret the provisions of this Agreement, the
prevailing party shall be entitled to recover reasonable attorneys’ fees from
the other party (unless such other party is the Escrow Agent), which fees may be
set by the court in the trial of such action or may be enforced in a separate
action brought for that purpose, and which fees shall be in addition to any
other relief that may be awarded.

[Signature Page Follows] 

-9- 




          IN
WITNESS WHEREOF, the undersigned have executed this Agreement as of the day and
year first above written. 

	 	ESCROW AGENT: 
	 	 	 
	 	COLLATERAL AGENTS, LLC 
	 	 	 
	 	 	  
	 	By:	/s/ Seth
      Fishman 
	 	 	Name: Seth Fishman 
	 	 	Title: President 
	 	 	  
	 	COMPANY: 
	 	 	 
	 	DRAGON ACQUISITION CORPORATION 
	 	 	 
	 	 	  
	 	By:	/s/ Yang
      Chen 
	 	 	Name: Yang Chen 
	 	 	Title: Chief Financial Officer 
	 	 	  
	 	INVESTOR REPRESENTATIVE: 
	 	 	 
	 	ACCESS AMERICA INVESTMENTS, LLC 
	 	 	 
	 	 	  
	 	By:	/s/ Christopher
      Efird 
	 	 	Name: Christopher Efird 
	 	 	Title: President 
	 	 	  
	 	MAKE GOOD SHAREHOLDER: 
	 	 	 
	 	LONGHAI HOLDINGS COMPANY LIMITED 
	 	 	 
	 	 	  
	 	By:	/s/ Antoine
      Cheng 
	 	 	Name: Antoine Cheng 
	 	 	Title: Director 


[Signature Page to Make Good Escrow Agreement] 




EXHIBIT A 

INVESTORS 


  	

        Investor’s Legal Name 	Investment 

        Amount 	Number of 

        Units 
	Access America Fund, LP 	$1,500,000 	375,000 
	Taylor International Fund, Ltd. 	$1,500,000 	375,000 
	Hua-Mei 21st Century Partners, LP 	$1,900,000 	475,000 
	Guerrilla Partners, LP 	$1,100,000 	275,000 
	Jayhawk Private Equity Fund II, L.P. 	$3,000,000 	750,000 
	Straus Partners, L.P. 	$500,000 	125,000 
	New York Liberty Fund LLC 	$200,000 	50,000 
	Trillion Growth China LP 	$500,000 	125,000 
	Paragon Capital LP 	$300,000 	75,000 
	Equity Trust Company Custodian FBO Thomas G.
      Berlin IRA 	$250,000 	62,500 
	DNST Properties, LLC 	$200,000 	50,000 
	Dr. Deborah Tekdogan 	$10,400 	2,600 
	Mary Beth Shea 	$52,000 	13,000 
	Thomas E. Nolan Living Trust 	$20,800 	5,200 
	Robert C. Stendel 	$15,600 	3,900 
	J&S Spitzer Family LLC 	$50,000 	12,500 
	TOTALS 	$11,098,800 	2,774,700