EXHIBIT
      10.1

     

    ESCROW
      AGREEMENT

     

    This
      Escrow Agreement is entered into as of January 12, 2007, by and among Kreido
      Biofuels, Inc. (f/k/a Gemwood Productions, Inc.), a Nevada corporation (the
      “Parent”), Joel A. Balbien (the “Indemnification Representative”) and Gottbetter
& Partners, LLP (the “Escrow Agent”).

     

    WHEREAS,
      the Parent has entered into an Agreement and Plan of Merger and Reorganization
      (the “Merger Agreement”) with Kreido Laboratories, a California corporation (the
“Company”), (i) pursuant to which a wholly-owned subsidiary of the Parent will
      merge with and into the Company, with the Company surviving the merger and
      (ii)
      as a result of which the Company will become a wholly-owned subsidiary of the
      Parent;

     

    WHEREAS,
      the Merger Agreement provides that an escrow account will be established to
      secure the indemnification obligations of the stockholders of the Company as
      of
      the Closing Date, as such terms are defined in the Merger Agreement
      (collectively, the “Indemnifying Stockholders”) to the Parent; and

     

    WHEREAS,
      the parties hereto desire to establish the terms and conditions pursuant to
      which such escrow account will be established and maintained.

     

    NOW,
      THEREFORE, the parties hereto hereby agree as follows:

     

    1. Consent
      of Company Stockholders.
      The
      Indemnifying Stockholders have, either by virtue of their entry into the Merger
      Agreement or through the execution of an instrument to such effect, consented
      to: (a) the establishment of this escrow to secure the Indemnifying
      Stockholders’ indemnification obligations under Article 6 of the Merger
      Agreement in the manner set forth herein, (b) the appointment of the
      Indemnification Representative as their representatives for purposes of this
      Agreement and as attorneys-in-fact and agents for and on behalf of each
      Indemnifying Stockholder, and the taking by the Indemnification Representative
      of any and all actions and the making of any decisions required or permitted
      to
      be taken or made by them under this Agreement and (c) all of the other
      terms, conditions and limitations in this Agreement.

     

    2. Escrow
      and Indemnification.

     

    (a) Escrow
      of Shares.
      Simultaneously with the execution of this Agreement, the Parent shall deposit
      with the Escrow Agent a certificate for 1,350,000 shares of common stock of
      the
      Parent, as determined pursuant to Section 1.5(b) of the Merger Agreement,
      issued in the name of the Escrow Agent or its nominee. The Escrow Agent hereby
      acknowledges receipt of such stock certificate. The shares deposited with the
      Escrow Agent pursuant to the first sentence of this Section 2(a) are
      referred to herein as the “Escrow Shares.” The Escrow Shares shall be held as a
      trust fund and shall not be subject to any lien, attachment, trustee process
      or
      any other judicial process of any creditor of any party hereto. The Escrow
      Agent
      agrees to hold the Escrow Shares in an escrow account (the “Escrow Account”),
      subject to the terms and conditions of this Agreement.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (b) Indemnification.
      The
      Indemnifying Stockholders have agreed in Section 6.1 of the Merger Agreement
      to
      indemnify and hold harmless the Parent from and against specified Damages (as
      defined in Section 6.1 of the Merger Agreement). The Escrow Shares shall be
      security for such indemnity obligation of the Indemnifying Stockholders, subject
      to the limitations, and in the manner provided, in this Agreement.

     

    (c) Dividends,
      Etc.
      Any
      securities distributed in respect of or in exchange for any of the Escrow
      Shares, whether by way of stock dividends, stock splits or otherwise, shall
      be
      issued in the name of the Escrow Agent or its nominee, and shall be delivered
      to
      the Escrow Agent, who shall hold such securities in the Escrow Account. Such
      securities shall be considered Escrow Shares for purposes hereof. Any cash
      dividends or property (other than securities) distributed in respect of the
      Escrow Shares shall promptly be distributed by the Escrow Agent to the
      Indemnifying Stockholders in accordance with Section 3(c).

     

    (d) Voting
      of Shares.
      The
      Indemnification Representative shall have the right, in its sole discretion,
      on
      behalf of the Indemnifying Stockholders, to direct the Escrow Agent in writing
      as to the exercise of any voting rights pertaining to the Escrow Shares, and
      the
      Escrow Agent shall comply with any such written instructions. In the absence
      of
      such instructions, the Escrow Agent shall not vote any of the Escrow Shares.
      The
      Indemnification Representative shall have no obligation to solicit consents
      or
      proxies from the Indemnifying Stockholders for purposes of any such
      vote.

     

    (e) Transferability.
      The
      respective interests of the Indemnifying Stockholders in the Escrow Shares
      shall
      not be assignable or transferable, other than by operation of law. Notice of
      any
      such assignment or transfer by operation of law shall be given to the Escrow
      Agent and the Parent, and no such assignment or transfer shall be valid until
      such notice is given.

     

    3. Distribution
      of Escrow Shares.

     

    (a) The
      Escrow Agent shall distribute the Escrow Shares only in accordance with (i)
      a
      written instrument delivered to the Escrow Agent that is executed by both the
      Parent and the Indemnification Representative and that instructs the Escrow
      Agent as to the distribution of some or all of the Escrow Shares, (ii) an
      order of a court of competent jurisdiction, a copy of which is delivered to
      the
      Escrow Agent by either the Parent or the Indemnification Representative, that
      instructs the Escrow Agent as to the distribution of some or all of the Escrow
      Shares, or (iii) the provisions of Section 3(b) hereof.

     

    (b) Within
      five business days after January 12, 2008 (the “Termination Date”), the Escrow
      Agent shall distribute to the Indemnifying Stockholders all of the Escrow Shares
      then held in escrow, registered in the name of the Indemnifying Stockholders.
      Notwithstanding the foregoing, if the Parent has previously delivered to the
      Escrow Agent a copy of a Claim Notice and the Escrow Agent has not received
      written notice of the resolution of the claim covered thereby, or if the Parent
      has previously delivered to the Escrow Agent a copy of an Expected Claim Notice
      and the Escrow Agent has not received written notice of the resolution of the
      anticipated claim covered thereby, the Escrow Agent shall retain in escrow
      after
      the Termination Date such number of Escrow Shares as have a Value (as defined
      in
      Section 4 below) equal to the Claimed Amount covered by such Claim Notice
      or equal to the estimated amount of Damages set forth in such Expected Claim
      Notice, as the case may be. Any Escrow Shares so retained in escrow shall be
      distributed only in accordance with the terms of clauses (i) or (ii) of
      Section 3(a) hereof. For purposes of this Agreement, a Claim Notice means a
      written notification under the Merger Agreement given by the Parent to the
      Indemnifying Stockholders which contains (i) a description and the amount (the
      “Claimed Amount”) of any Damages incurred or reasonably expected to be incurred
      by the Parent, (ii) a statement that the Parent is entitled to indemnification
      under Article 6 of the Merger Agreement for such Damages and a reasonable
      explanation of the basis therefor, and (iii) a demand for payment (in the manner
      provided in Article 9 of the Merger Agreement below) in the amount of such
      Damages. For purposes of this Agreement, an Expected Claims Notice means a
      notice delivered pursuant to the Merger Agreement by the Parent to an
      Indemnifying Stockholder, before expiration of a representation or warranty,
      to
      the effect that, as a result a legal proceeding instituted by or written claim
      made by a third party, the Parent reasonably expects to incur Damages as a
      result of a breach of such representation or warranty.

     

    
      
        
        

      

      
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    (c) Any
      distribution of all or a portion of the Escrow Shares (or cash or other property
      pursuant to Section 2(c)) to the Indemnifying Stockholders shall be made by
      delivery of stock certificates issued in the name of the Indemnifying
      Stockholders covering such percentage of the Escrow Shares being distributed
      as
      is calculated in accordance with the percentages set forth opposite such
      holders’ respective names on Attachment A
      attached
      hereto; provided,
      however,
      that
      the Escrow Agent shall withhold the distribution of the portion of the Escrow
      Shares otherwise distributable to an Indemnifying Stockholder who has not,
      according to a written notice provided by the Parent to the Escrow Agent, prior
      to such distribution, surrendered pursuant to the terms of the Merger Agreement
      his, her or its documents formerly representing equity interests of the Company.
      Any such withheld shares shall be delivered to the Parent promptly after the
      Termination Date, and shall be delivered by the Parent to the Indemnifying
      Stockholders to whom such shares would have otherwise been distributed upon
      surrender of documents evidencing their Company equity interests. Distributions
      to the Indemnifying Stockholders shall be made by mailing stock certificates
      to
      such holders at their respective addresses shown on Attachment A
      (or such
      other address as may be provided in writing to the Escrow Agent by any such
      holder). No fractional Escrow Shares shall be distributed to Indemnifying
      Stockholders pursuant to this Agreement. Instead, the number of shares that
      each
      Indemnifying Stockholder shall receive shall be rounded up or down to the
      nearest whole number (provided that the Indemnification Representative shall
      have the authority to effect such rounding in such a manner that the total
      number of whole Escrow Shares to be distributed equals the number of Escrow
      Shares then held in the Escrow Account).

     

    4. Valuation
      of Escrow Shares.
      For
      purposes of this Agreement, the “Value” of any Escrow Shares shall be $1.35 per
      share, multiplied by the number of such Escrow Shares.

     

    5. Fees
      and Expenses of Escrow Agent.
      The
      Parent, on the one hand, and the Indemnifying Stockholders, on the other hand,
      shall each pay one-half of the fees of the Escrow Agent for the services to
      be
      rendered by the Escrow Agent hereunder.

     

    6. Limitation
      of Escrow Agent’s Liability.

     

    
      
        
        

      

      
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    (a) The
      Escrow Agent shall incur no liability with respect to any action taken or
      suffered by it in reliance upon any notice, direction, instruction, consent,
      statement or other documents believed by it to be genuine and duly authorized,
      nor for other action or inaction except its own willful misconduct or gross
      negligence. The Escrow Agent shall not be responsible for the validity or
      sufficiency of this Agreement. In all questions arising under the Escrow
      Agreement, the Escrow Agent may rely on the advice of counsel, and the Escrow
      Agent shall not be liable to anyone for anything done, omitted or suffered
      in
      good faith by the Escrow Agent based on such advice. The Escrow Agent shall
      not
      be required to take any action hereunder involving any expense unless the
      payment of such expense is made or provided for in a manner reasonably
      satisfactory to it. In no event shall the Escrow Agent be liable for indirect,
      punitive, special or consequential damages.

     

    (b) The
      Parent and the Indemnifying Stockholders agree to indemnify the Escrow Agent
      for, and hold it harmless against, any loss, liability or expense incurred
      without gross negligence or willful misconduct on the part of the Escrow Agent,
      arising out of or in connection with its carrying out of its duties hereunder.
      The Parent, on the one hand, and the Indemnifying Stockholders, on the other
      hand, shall each be liable for one-half of such amounts.

     

    7. Liability
      and Authority of Indemnification Representative; Successors and
      Assignees.

     

    (a) The
      Indemnification Representative shall not incur any liability to the Indemnifying
      Stockholders with respect to any action taken or suffered by him in reliance
      upon any note, direction, instruction, consent, statement or other documents
      believed by him to be genuinely and duly authorized, nor for other action or
      inaction except his own willful misconduct or gross negligence. The
      Indemnification Representative may, in all questions arising under the Escrow
      Agreement, rely on the advice of counsel and the Indemnification Representative
      shall not be liable to the Indemnifying Stockholders for anything done, omitted
      or suffered in good faith by the Indemnification Representative based on such
      advice.

     

    (b) In
      the
      event of the death or permanent disability of the Indemnification
      Representative, or his or her resignation as an Indemnification Representative,
      a successor Indemnification Representative shall be appointed by the other
      Indemnification Representative or, absent its appointment, a successor
      Indemnification Representative shall be elected by a majority vote of the
      Indemnifying Stockholders, with each such Indemnifying Stockholder (or his,
      her
      or its successors or assigns) to be given a vote equal to the number of votes
      represented by the shares of stock of the Company held by such Indemnifying
      Stockholder immediately prior to the effective time of the share purchase under
      the Merger Agreement. Each successor Indemnification Representative shall have
      all of the power, authority, rights and privileges conferred by this Agreement
      upon the original Indemnification Representative, and the term “Indemnification
      Representative” as used herein shall be deemed to include successor
      Indemnification Representative.

     

    (c) The
      Indemnification Representative shall have full power and authority to represent
      the Indemnifying Stockholders, and their successors, with respect to all matters
      arising under this Agreement and all actions taken by the Indemnification
      Representative hereunder shall be binding upon the Indemnifying Stockholders,
      and their successors, as if expressly confirmed and ratified in writing by
      each
      of them. Without limiting the generality of the foregoing, the Indemnification
      Representative shall have full power and authority to interpret all of the
      terms
      and provisions of this Agreement, to compromise any claims asserted hereunder
      and to authorize any release of the Escrow Shares to be made with respect
      thereto, on behalf of the Indemnifying Stockholders and their successors.


     

    
      
        
        

      

      
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    (d) The
      Escrow Agent may rely on the Indemnification Representative as the exclusive
      agent of the Indemnifying Stockholders under this Agreement and shall incur
      no
      liability to any party with respect to any action taken or suffered by it in
      reliance thereon.

     

    8. Amounts
      Payable by Indemnifying Stockholders.
      The
      amounts payable by the Indemnifying Stockholders under this Agreement (i.e.,
      the
      fees of the Escrow Agent payable pursuant to Section 5 and the
      indemnification obligations pursuant to Section 6(b)) shall be payable
      solely as follows. The Escrow Agent shall notify the Indemnification
      Representative of any such amount payable by the Indemnifying Stockholders
      as
      soon as it becomes aware that any such amount is payable, with a copy of such
      notice to the Parent. On the sixth business day after the delivery of such
      notice, the Escrow Agent shall sell such number of Escrow Shares (up to the
      number of Escrow Shares then available in the Escrow Account), subject to
      compliance with all applicable securities laws, as is necessary to raise such
      amount, and shall be entitled to apply the proceeds of such sale in satisfaction
      of such indemnification obligations of the Indemnifying Stockholders; provided
      that if the Parent delivers to the Escrow Agent (with a copy to the
      Indemnification Representative), within five business days after delivery of
      such notice by the Indemnification Representative, a written notice contesting
      the legitimacy or reasonableness of such amount, then the Escrow Agent shall
      not
      sell Escrow Shares to raise the disputed portion of such claimed amount except
      in accordance with the terms of clauses (i) or (ii) of
      Section 3(a).

     

    9. Termination.
      This
      Agreement shall terminate upon the distribution by the Escrow Agent of all
      of
      the Escrow Shares in accordance with this Agreement; provided that the
      provisions of Sections 6 and 7 shall survive such termination.

     

    10. Notices.
      All
      notices, instructions and other communications given hereunder or in connection
      herewith shall be in writing. Any such notice, instruction or communication
      shall be sent either (i) by registered or certified mail, return receipt
      requested, postage prepaid, or (ii) via a reputable nationwide overnight
      courier service, in each case to the address set forth below. Any such notice,
      instruction or communication shall be deemed to have been delivered two business
      days after it is sent by registered or certified mail, return receipt requested,
      postage prepaid, or one business day after it is sent via a reputable nationwide
      overnight courier service.

     

    If
      to the
      Parent:

    


    Kreido
      Biofuels, Inc.

    1140
      Avenida Acaso

    Camarrillo,
      CA 93012

    Attn:
      Joel A. Balbien, Chief Executive Officer

    Facsimile:
      (805) 384-0989

     

    
      
        
        

      

      
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    If
      to the
      Indemnification Representative:

    


    Mr.
      Joel
      A. Balbien

    Kreido
      Biofuels, Inc.

    1140
      Avenida Acaso

    Camarrillo,
      CA 93012

    Attn:
      Joel A. Balbien, Chief Executive Officer

    Facsimile:
      (805) 384-0989

    


    If
      to the
      Escrow Agent:

    


    Gottbetter
      & Partners, LLP

    488
      Madison Avenue, 12th
      Floor

    New
      York,
      NY 10022

    Attn:
      Adam S. Gottbetter, Esq.

    Facsimile: (212)
      400-6901

    


    Any
      party
      may give any notice, instruction or communication in connection with this
      Agreement using any other means (including personal delivery, telecopy or
      ordinary mail), but no such notice, instruction or communication shall be deemed
      to have been delivered unless and until it is actually received by the party
      to
      whom it was sent. Any party may change the address to which notices,
      instructions or communications are to be delivered by giving the other parties
      to this Agreement notice thereof in the manner set forth in this
      Section 10.

     

    11. Successor
      Escrow Agent.
      In the
      event the Escrow Agent becomes unavailable or unwilling to continue in its
      capacity herewith, the Escrow Agent may resign and be discharged from its duties
      or obligations hereunder by delivering a resignation to the parties to this
      Escrow Agreement, not less than 60 days prior to the date when such
      resignation shall take effect. The Parent may appoint a successor Escrow Agent
      without the consent of the Indemnification Representative so long as such
      successor is a bank with assets of at least $500 million, and may appoint any
      other successor Escrow Agent with the consent of the Indemnification
      Representative, which shall not be unreasonably withheld. If, within such notice
      period, the Parent provides to the Escrow Agent written instructions with
      respect to the appointment of a successor Escrow Agent and directions for the
      transfer of any Escrow Shares then held by the Escrow Agent to such successor,
      the Escrow Agent shall act in accordance with such instructions and promptly
      transfer such Escrow Shares to such designated successor. If no successor Escrow
      Agent is named as provided in this Section 11 prior to the date on which the
      resignation of the Escrow Agent is to properly take effect, the Escrow Agent
      may
      apply to a court of competent jurisdiction for appointment of a successor Escrow
      Agent.

     

    
      
        
        

      

      
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    12. General.

     

    (a) Governing
      Law; Assigns.
      This
      Agreement shall be governed by and construed in accordance with the internal
      laws of the State of New York without regard to conflict-of-law principles
      and
      shall be binding upon, and inure to the benefit of, the parties hereto and
      their
      respective successors and assigns.

     

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

     

    (c) Entire
      Agreement.
      Except
      for those provisions of the Merger Agreement referenced herein, this Agreement
      constitutes the entire understanding and agreement of the parties with respect
      to the subject matter of this Agreement and supersedes all prior agreements
      or
      understandings, written or oral, between the parties with respect to the subject
      matter hereof.

     

    (d) Waivers.
      No
      waiver by any party hereto of any condition or of any breach of any provision
      of
      this Escrow Agreement shall be effective unless in writing. No waiver by any
      party of any such condition or breach, in any one instance, shall be deemed
      to
      be a further or continuing waiver of any such condition or breach or a waiver
      of
      any other condition or breach of any other provision contained
      herein.

     

    (e) Amendment.
      This
      Agreement may be amended only with the written consent of the Parent, the Escrow
      Agent and the Indemnification Representative.

     

    (f) Consent
      to Jurisdiction and Service.
      The
      parties hereby absolutely and irrevocably consent and submit to the jurisdiction
      of the courts in the State of New York and of any Federal court located in
      said
      State in connection with any actions or proceedings brought against any party
      hereto by the Escrow Agent arising out of or relating to this Escrow Agreement.
      In any such action or proceeding, the parties hereby absolutely and irrevocably
      waive personal service of any summons, complaint, declaration or other process
      and hereby absolutely and irrevocably agree that the service thereof may be
      made
      by certified or registered first-class mail directed to such party, at their
      respective addresses in accordance with Section 10 hereof.

     

    
      
        
        

      

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

     

    
      	 	 	 
	 	KREIDO
              BIOFUELS,
              INC.
	 
 	 
 	 
 
	 	By:  	/s/
              Stephen B. Jackson 
	 	
              
Name: Stephen
              B. Jackson
	 	Title: Chief
              Executive Officer


    

     

    
      	 	        
              	 
	
            	/s/
              Joel A.
              Balbien
	 	
              
Joel
              A. Balbien, Individually and as Indemnification
              Representative


    

    


    
      	 	 	 
	 	GOTTBETTER
&
              PARTNERS, LLP
	 
 	 
 	 
 
	 	By:  	/s/
              Adam
              S. Gottbetter
	 	
              
Name: Adam
              S. Gottbetter, Esq.
	 	Title: Partner




    
      
        
        

      

      
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