Document:

LOCK-UP
      AGREEMENT

    

    THIS
      LOCK-UP AGREEMENT (“Agreement”)
      is
      made and entered into as of June 11, 2008, by and among China Advanced
      Construction Materials Group, Inc., a Delaware corporation (the “Company”),
      and
      the individuals listed on Schedule
      A
      attached
      hereto and made a part hereof (the “Stockholders”).
      (The
      Company and the Stockholders may sometimes be referred to herein singularly
      as a
“party,” or collectively as, the “parties.”). Capitalized terms used herein have
      the respective meanings ascribed thereto in the Subscription Agreement (as
      defined below) unless otherwise defined herein. 

    

    WHEREAS,
      the
      Stockholders are the holders of an aggregate of 8,809,583 shares (the
“Shares”)
      of the
      Company’s common stock, $0.001 par value per share (“Common
      Stock”),
      as
      further set forth on Schedule
      A
      attached
      hereto and made a part hereof; and

    

    WHEREAS,
      the
      Company has offered for sale (the “Offering”)
      certain investment units, each consisting of one share of the Company’s Series A
      Convertible Preferred Stock, $0.001 par value per share (the “Series
      A Preferred”),
      each
      share of which will be convertible into four (4) shares of Common Stock, and
      one
      Warrant to purchase two (2) shares of Common Stock, in accordance with a
      Subscription Agreement (the “Subscription
      Agreement”)
      between the Company and each Subscriber named therein (collectively, the
“Investors”)
      and as
      further described in the Company’s Private Placement Memorandum (“PPM”)
      dated
      March 17, 2008, as amended on April 11, 2008, May 21, 2008 and May 28, 2008
      and
      in the Consent to Modification and Amendment Agreement to the PPM dated as
      of
      the date hereof; and

    

    WHEREAS,
      it is a
      condition to the Offering that the Stockholders agree to “lock-up” the Shares,
      pursuant to the terms and conditions of this Agreement; and

    

    WHEREAS,
      as an
      inducement to the Investors to enter into the Subscription Agreements, Xianfu
      Han and Weili He (collectively, the “Management
      Stockholders”)
      have
      agreed to place an aggregate of (i) 3,500,000 of the Shares (the “Make
      Good Escrow Shares”)
      into
      escrow for the benefit of the Investors in the event that the Company fails
      to
      satisfy the “Performance Thresholds”, pursuant to the terms and conditions of a
      Securities Escrow Agreement, dated as of even date herewith (the “Make
      Good Agreement”),
      by
      and among the Investors party thereto, Professional
      Traders Management, LLC
      (as
      representative of the Investors), American Stock Transfer & Trust Company
      (as escrow agent), the Company and the Management Stockholders and (ii)
      1,500,000 of the Shares (together with the Make Good Escrow Shares, the
“Escrow
      Shares”)
      into
      escrow for the benefit of the Investors pledged by the Stockholders(the
“Pledge
      Agreement”).

    

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

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    1. Agreement
      to Retain the Shares.
      

    

    (a) The
      Stockholders hereby agree not to sell, assign, transfer, pledge, hypothecate,
      or
      otherwise dispose of any of the Shares during the period beginning on and
      including the date of the final closing of the Offering through and including
      the earlier of (i) two (2) years after the final closing of the Offering, (ii)
      the voluntary conversion of all outstanding shares of Preferred Stock, (iii)
      the
      mandatory conversion of all outstanding shares of Preferred Stock, or (iv)
      the
      sale of the Company (the “Lock-Up
      Period”).

    

    (b) The
      foregoing restrictions are expressly agreed to and preclude the Stockholders
      from engaging in any hedging or other transactions which may lead to or result
      in a sale of any of the Shares during the Lock-Up Period other than the Escrow
      Shares, even if such Shares would be sold by someone other than a Stockholder.
      Such prohibited hedging or other transactions would include without limitation
      any short sale (whether or not against the box), any pledge or any purchase,
      sale or grant of any right (including without limitation any put or call option)
      with respect to any of the Shares, without the prior written consent of the
      Investors.

    

    (c) The
      Stockholders agree and consent to the entry of stop transfer instructions with
      the Company’s transfer agent for the Company’s Common Stock against transfers of
      the Shares, if any, by a Stockholder in contravention of the restrictions set
      forth herein. The Stockholders understand that the Company will rely upon the
      representations set forth in this Agreement in proceeding in connection with
      the
      Offering. The Stockholders understand that their agreement is irrevocable and
      shall be binding upon their heirs, legal representatives, successors and
      assigns.

    

    (d) Notwithstanding
      the foregoing, any Stockholder (for the purposes of this Section 1(d), the
      “Transferring
      Holder”)
      may,
      as applicable, transfer any or all of the Transferring Holder’s Shares, either
      during the Transferring Holder’s lifetime, or on the Transferring Holder’s
      death, by will or intestacy to the Transferring Holder’s “immediate family,” as
      defined in Rule 16a-1 of the General Rules and Regulations of the Securities
      Exchange Act of 1934, as amended, or to a trust or other entity, the
      beneficiaries of which are exclusively such Transferring Holder and/or a member
      or members of the Transferring Holder’s “immediate family”; provided,
      however,
      that in
      any such case it shall be a condition to the transfer that the transferee
      execute an agreement stating that the transferee is receiving and holding such
      Shares subject to the provisions of this Agreement, and there shall be no
      further transfer of such Shares except in accordance with this Agreement.

    

    (e) If
      any of
      the Escrow Shares are released to the Investors (“Released
      Shares”),
      pursuant to the terms and conditions of the Make Good Agreement or the Pledge
      Agreement, the Lock-Up Period shall be deemed to have automatically and
      permanently terminated with respect to such Released Shares.

    

    (f) This
      Agreement shall terminate at the earlier of (i) the expiration of the Lock-Up
      Period; or (ii) the termination of the Subscription Agreements.

    

    2. Representations,
      Warranties and Covenants of the Company.
      The
      Company represents, warrants and covenants to the Stockholders that this
      Agreement (a) has been authorized by all necessary corporate action on the
      part
      of the Company and has been duly executed by a duly authorized officer of the
      Company, and (b) constitutes the legal, valid and binding obligation of the
      Company. Neither the execution of this Agreement by the Company nor the
      consummation of the transactions contemplated hereby will result in a breach
      or
      violation of the terms of any agreement by which the Company is bound, or of
      any
      decree, judgment, order, law or regulation now in effect of any court or other
      governmental body applicable to the Company.

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    

    3. Additional
      Documents.
      The
      Stockholders and the Company hereby covenant and agree to execute and deliver
      any additional documents necessary or desirable, in the reasonable opinion
      of
      the Company’s legal counsel to carry out the intent of this
      Agreement.

    

    4. Consent
      and Waiver.
      The
      Stockholders hereby give any consents or waivers that are reasonably required
      for the consummation of the Offering under the terms of any agreement to which
      a
      Stockholder is a party, or pursuant to any rights a Stockholder may
      have.

    

    5. Miscellaneous.

    

    (a) Severability.
      If any
      term, provision, covenant or restriction of this Agreement is held by a court
      of
      competent jurisdiction to be invalid, void or unenforceable, the remainder
      of
      the terms, provisions, covenants and restrictions of this Agreement shall remain
      in full force and effect and shall in no way be affected, impaired or
      invalidated.

    

    (b) Binding
      Effect and Assignment.
      This
      Agreement and all of the provisions hereof shall be binding upon and inure
      to
      the benefit of the parties hereto and their respective successors and permitted
      assigns, but, except as otherwise specifically provided herein, neither this
      Agreement nor any of the rights, interests or obligations of the parties hereto
      may be assigned by any of the parties without the prior written consent of
      the
      other.

    

    (c) Amendments
      and Modifications.
      This
      Agreement may not be modified, amended, altered or supplemented except upon
      the
      execution and delivery of a written agreement executed by the parties
      hereto.

    

    (d) Specific
      Performance; Injunctive Relief.
      The
      parties hereto acknowledge that the Company will be irreparably harmed and
      that
      there will be no adequate remedy at law for a violation of any of the covenants
      or agreements of the Stockholders set forth herein. Therefore, it is agreed
      that, in addition to any other remedies which may be available to the Company
      upon such violation, the Company shall have the right to enforce such covenants
      and agreements by specific performance, injunctive relief or by any other means
      available to it at law or in equity.

    

    (e) Notices.
      All
      notices, requests, claims, demands and other communications hereunder shall
      be
      in writing and sufficient if delivered in person, by commercial overnight
      courier service, by confirmed telecopy, or sent by mail (registered or certified
      mail, postage prepaid, return receipt requested) to the respective parties
      as
      follows:

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    

    if
      to the
      Company, to:

    

    China
      Advanced Construction Materials Group, Inc.

    Yingu
      Plaza, 9 Beisihuanxi Road, Suite 1708 

    Haidian
      District, Beijing 100080

    Attention:
      Xianfu Han, Chief Executive Officer

    

    with
      a
      copy to:

    

    Anslow
      & Jaclin, LLP

    195
      Route
      9 South, Suite 204

    Manalapan,
      NJ 07726

    Attn:
      Richard I. Anslow, Esq.

    Fax:
      (732) 577-1188

    

    if
      to the
      Stockholders:

    

    to
      the
      addresses set forth below their names on Schedule
      A,
      attached  hereto,

    

    or
      to
      such other address as either party may have furnished to the other in writing
      in
      accordance herewith, except that notices of change of address shall only be
      effective upon receipt.

    

    (f) Governing
      Law.
      This
      Agreement shall be governed by, construed and enforced in accordance with the
      laws of New York without giving effect to principles of conflicts of
      law.

    

    (g) Entire
      Agreement.
      This
      Agreement contains the entire understanding of the parties in respect of the
      subject matter hereof, and supersedes all prior negotiations and understandings
      between the parties with respect to such subject matter.

    

    (h) Counterparts.
      This
      Agreement may be executed in counterparts, each of which shall be an original,
      but all of which together shall constitute one and the same
      agreement.

    

    (i)
       Effect
      of Headings.
      The
      section headings herein are for convenience only and shall not affect the
      construction or interpretation of this Agreement.

    

    (j) Third-Party
      Beneficiaries.
      The
      Investors shall be intended third party beneficiaries of this Agreement to
      the
      same extent as if they were parties hereto, and shall be entitled to enforce
      the
      provisions hereof.

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF,
      the
      parties herein have executed this Agreement as of the date first set forth
      above.

    

    COMPANY:
      

    

    CHINA
      ADVANCED CONSTRUCTION MATERIALS GROUP, INC.

    

    
      	
              By:

            	
              /s/
                Xianfu Han

            	 
	 	
              Name:
                Xianfu Han

            	 
	 	
              Title:
                Chief Executive Officer

            	 

    

    

    STOCKHOLDERS:

    

    
      	
              /s/
                Xianfu Han

            
	
              Xianfu
                Han, in his individual capacity

            
	 
	
              /s/
                Weili He

            
	
              Weili
                He, in his individual capacity

            

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Schedule
      A

    

    The
      Stockholders

    

    
      	
              Name
                and Address

            	 	
              Total
                Shares

            	 	
              Shares Subject
                

              to
                Lock-Up

            	 
	
              Xianfu
                Han

            	 	 	
              5,285,750

            	 	 	
              5,285,750

            	 
	
              Weili
                He

            	 	 	
              3,523,833

            	 	 	
              3,523,833

            	 
	 	 	 	 	 	 	 	 
	
              TOTAL:

            	 	 	
              8,809,583

            	 	 	
              8,809,583ESCROW
      AGREEMENT

     

    This
      ESCROW AGREEMENT (this “Agreement”)
      made
      as of June
      11,
      2008 by and between China Advanced Construction Materials Group, Inc. (the
      “Issuer”)
      and
      Maxim Group LLC (the “Placement
      Agent”),
      whose
      addresses and other information appear on the Information Sheet (as defined
      herein) attached to this Agreement, and American Stock Transfer & Trust
      Company, 59 Maiden Lane, New York, NY 10038 (the “Escrow
      Agent”).

     

    WITNESETH:

     

    WHEREAS,
      the Issuer proposes to sell units (“Units”),
      each
      consisting of (i) one share of Issuer’s Series A Convertible Preferred
      Stock, par value $.001 per share, each share of which shall be convertible
      into
      four (4) shares of the Issuer’s Common Stock, par value $0.001 per share (the
“Common
      Stock”)
      and
      (ii) a warrant to purchase two (2) shares of Common Stock, par value $0.001
      per share;

     

    WHEREAS,
      the Issuer is offering to “accredited investors,” on a “best efforts” basis, up
      to 875,000 Units at a purchase price per Unit of $8.00 (the “Offering”);

     

    WHEREAS,
      the Issuer and the Placement Agent propose to establish an escrow account (the
      “Escrow
      Account”),
      to
      which subscription monies which are received by the Escrow Agent from the
      Placement Agent or the Issuer in connection with such private offering are
      to be
      credited, and the Escrow Agent is willing to establish the Escrow Account on
      the
      terms and subject to the conditions hereinafter set forth;

     

    WHEREAS,
      the Escrow Agent has an agreement with JP Morgan Chase Bank (the “Bank”)
      to
      establish a special bank account into which the subscription monies, which
      are
      received by the Escrow Agent and credited to the Escrow Account, are to be
      deposited;

     

    NOW,
      THEREFORE, in consideration of the premises and mutual covenants herein
      contained, the parties hereto hereby agree as follows:

     

    1. Information
      Sheet.
      Each
      capitalized term not otherwise defined in this Agreement shall have the meaning
      set forth for such term on the information sheet which is attached to this
      Agreement as Exhibit
      A
      and is
      incorporated by reference herein and made a part hereof (the “Information
      Sheet”).

     

    2. Establishment
      of the Bank Account.

     

    2.1 The
      Escrow Agent shall establish a non-interest-bearing bank account at the branch
      of the Bank selected by the Escrow Agent, and bearing the designation set forth
      on the Information Sheet (heretofore
      defined as the
      “Bank
      Account”).
      The
      purpose of the Bank Account is for (a) the deposit of all subscription monies
      (checks or wire transfers) which are received from prospective purchasers of
      the
      Units and are delivered to the Escrow Agent, (b) the holding of amounts of
      subscription monies which are collected through the banking system, and (c)
      the
      disbursement of collected funds, all as described herein.

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    2.2 On
      or
      before the date of the initial deposit in the Bank Account pursuant to this
      Agreement, the Placement Agent shall notify the Escrow Agent of the date of
      the
      commencement of the Offering (the “Effective
      Date”),
      and
      the Escrow Agent shall not be required to accept any amounts for credit to
      the
      Escrow Account or for deposit in the Bank Account prior to its receipt of such
      notification.

     

    2.3 The
      “Offering
      Period,”
which
      shall be deemed to commence on the Effective Date, shall consist of the number
      of calendar days or business days set forth on the Information Sheet. The
      Offering Period shall be extended at the mutual discretion of both the Company
      and the Placement Agent (an “Extension
      Period”)
      only
      if the Escrow Agent shall have received notice thereof prior to the expiration
      of the Offering Period. The Extension Period, which shall be deemed to commence
      on the next calendar day following the expiration of the Offering Period, shall
      consist of the number of calendar days or business days set forth on the
      Information Sheet. The last day of the Offering Period, or the last day of
      the
      Extension Period (if the Escrow Agent has received written notice thereof as
      herein above provided), is referred to herein as the “Termination
      Date.”
Except
      as provided in Section 4.3 hereof, after the Termination Date, the Placement
      Agent shall not deposit, and the Escrow Agent shall not accept, any additional
      amounts representing payments by prospective purchasers.

     

    3. Deposits
      to the Bank Account.

     

    3.1 The
      Placement Agent shall promptly deliver to the Escrow Agent all monies which
      it
      receives from
      prospective purchasers of the Securities,
      which monies shall be in the form of checks,
      or wire
      transfers, provided,
      however,
      that
“Cashiers” checks and “Money Orders” must be in amounts greater than $10,000;
      Cashiers checks or Money Orders in amounts less than $10,000 shall be rejected
      by the Escrow Agent. Upon the Escrow Agent’s receipt of such monies, same shall
      be credited to the Escrow Account. All checks delivered to the Escrow Agent
      shall be made payable to “China
      Advanced Construction Materials Group Escrow Account.”
Any
      check payable other than to the Escrow Agent as required hereby shall
      be
      returned to the prospective purchaser, or if the Escrow Agent has insufficient
      information to do so, then to the Placement Agent (together with any
      subscription information or other documents delivered therewith) by noon of
      the
      next business day following receipt of such check by the Escrow Agent, and
      such
      check shall be deemed not to have been delivered to the Escrow Agent pursuant
      to
      the terms of this Agreement.

     

    3.2 Promptly
      after receiving subscription monies as described in Section 3.1, the Escrow
      Agent shall deposit the same into the Bank Account. Amounts of monies so
      deposited are hereinafter referred to as “Escrow
      Amounts.”
The
      Escrow Agent shall cause the Bank to process all Escrow Amounts for collection
      through the banking system. 

     

    3.3 The
      Escrow Agent shall not be required to accept for credit to the Escrow Account
      or
      for deposit into the Bank Account checks or wires that are not accompanied
      by
      the appropriate subscription information. 

     

    3.4 The
      Escrow Agent shall not be required to accept in the Escrow Account any amounts
      representing payments by prospective purchasers, whether by check or wire,
      except during the Escrow Agent's regular business hours.

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    3.5 Those
      Escrow Amounts which have been deposited in the Bank Account and which have
      cleared the banking system and have been collected by the Escrow Agent are
      herein referred to as the “Fund.”

     

    3.6 If
      the
      Offering is terminated before the Termination Date, the Escrow Agent shall
      refund any portion of the Fund prior to disbursement of the Fund in accordance
      with Article 4 hereof upon instructions in writing signed by the Issuer and
      the
      Placement Agent. 

     

    3.7 If
      prior
      to the disbursement of the Fund in accordance with Section 4.2 below, the Escrow
      Agent has received notice from the Issuer that the subscription of a purchaser
      has been rejected since such purchaser does not qualify as an investor in the
      Offering, the Escrow Agent shall promptly refund to such purchaser the amount
      of
      payment received from such purchaser which is then held in the Fund or which
      thereafter clears the banking system, without interest thereon or deduction
      therefrom, by drawing a check on the Bank Account for the amount of such payment
      and transmitting it to the purchaser.

     

    4. Disbursement
      from the Bank Account.

     

    4.1 Subject
      to Section 4.3 below, if the Offering is terminated before the Termination
      Date
      by the Issuer, the Escrow Agent shall, upon its receipt of written instructions
      signed by both the Issuer and the Placement Agent, refund to each prospective
      subscriber the aggregate amount of the payment from said subscriber then held
      in
      the Fund or which thereafter clears the banking system, without interest thereon
      or deduction therefrom.

     

    4.2 Subject
      to Section 4.3 below, if at any time up to the close of regular banking hours
      on
      the Termination Date, the Escrow Agent has received joint written instructions
      from the Issuer and the Placement Agent that all conditions for release of
      funds
      and the issuance of
      Securities have been met for closing, the Escrow Agent shall promptly disburse
      the Fund in accordance with such instructions; the parties hereto acknowledge
      and agree that
      there will only be one closing of the Offering prior to the Termination
      Date.

     

    4.3 Upon
      disbursement of all amounts in the Fund pursuant to the terms of this Article
      4,
      the Escrow Agent shall be relieved of further obligations and released from
      all
      liability under this Agreement with respect to the Escrow Account. It is
      expressly agreed and understood that in no event shall the aggregate amount
      of
      payments made by the Escrow Agent exceed the amount of the Fund.

     

    5. Rights,
      Duties and Responsibilities of Escrow Agent.
      It is
      understood and agreed that the duties of the Escrow Agent are purely ministerial
      in nature, and that:

     

    5.1 The
      Escrow Agent shall notify the Placement Agent, on a daily basis, of the Escrow
      Amounts which have been deposited in the Bank Account and of the amounts,
      constituting the Fund, which have cleared the banking system and have been
      collected by the Escrow Agent.

     

    5.2 The
      Escrow Agent shall not be responsible for or be required to enforce any of
      the
      terms or conditions of the subscription agreement or any other agreement between
      the Placement Agent and the Issuer and any prospective purchaser nor shall
      the
      Escrow Agent be responsible for the performance by the Issuer of its obligations
      under this Agreement.

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    5.3 The
      Escrow Agent shall not be required to accept from the Placement Agent or the
      Issuer any subscription information pertaining to prospective purchasers unless
      such subscription information is accompanied by checks or wire transfers meeting
      the requirements of Section 3.1, nor shall the Escrow Agent be required to
      keep
      records of any information with respect to payments deposited by the Placement
      Agent or the Issuer except as to the amount and date of such payments; however,
      the Escrow Agent shall notify the Placement Agent or the Issuer within a
      reasonable time of any discrepancy between the amount set forth in any
      subscription information and the amount delivered to the Escrow Agent therewith.
      Such amount need not be accepted for deposit in the Escrow Account until such
      discrepancy has been resolved.

     

    5.4 The
      Escrow Agent shall be under no duty or responsibility to enforce collection
      of
      any check delivered to it hereunder. The Escrow Agent, within a reasonable
      time,
      shall return to the Placement Agent any check received which is dishonored,
      together with the subscription information, if any, which accompanied such
      check.

     

    5.5 The
      Escrow Agent shall be entitled to rely upon the accuracy, act in reliance upon
      the contents, and assume the genuineness of any notice, instruction,
      certificate, signature, instrument or other document which is given to the
      Escrow Agent pursuant to this Agreement without the necessity of the Escrow
      Agent verifying the truth or accuracy thereof. The Escrow Agent shall not be
      obligated to make any inquiry as to the authority, capacity, existence or
      identity of any person purporting to give any such notice or instructions or
      to
      execute any such certificate, instrument or other document.

     

    5.6 If
      the
      Escrow Agent is uncertain as to its duties or rights hereunder or shall receive
      instructions with respect to the Bank Account, the Escrow Amounts or the Fund
      which, in its sole determination, are in conflict either with other instructions
      received by it or with any provision of this Agreement, it shall be entitled
      to
      hold the Escrow Amounts, the Fund, or a portion thereof, in the Bank Account
      pending the resolution of such uncertainty to the Escrow Agent’s sole
      satisfaction, by final judgment of a court or courts of competent jurisdiction
      or otherwise.

     

    5.7 The
      Escrow Agent shall not be liable for any action taken or omitted hereunder,
      or
      for the misconduct of any employee, agent or attorney appointed by it, except
      in
      the case of willful misconduct or gross negligence. The Escrow Agent shall
      be
      entitled to consult with counsel of its own choosing and shall not be liable
      for
      any action taken, suffered or omitted by it in accordance with the advice of
      such counsel, except in the case of willful misconduct or gross negligence
      on
      the part of Escrow Agent.

     

    5.8 The
      Escrow Agent shall have no responsibility at any time to ascertain whether
      or
      not any security interest exists in the Escrow Amounts, the Fund or any part
      thereof or to file any financing statement under the Uniform Commercial Code
      with respect to the Fund or any part thereof.

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

     

    6. Amendment:
      Resignation.
      This
      Agreement may be altered or amended only with the written consent of the Issuer,
      the Placement Agent and the Escrow Agent. The Escrow Agent may resign for any
      reason upon five (5) business days' written notice to the Issuer and the
      Placement Agent. Should the Escrow Agent resign as herein provided, it shall
      not
      be required to accept any deposit, make any disbursement or otherwise dispose
      of
      the Escrow Amounts or the Fund, but its only duty shall be to hold the Escrow
      Amounts until they clear the banking system and the Fund for a period of not
      more than five (5) business days following the effective date of such
      resignation, at which time (a) if a successor escrow agent shall have been
      appointed and written notice thereof (including the name and address of such
      successor escrow agent) shall have been given to the resigning Escrow Agent
      by
      the Issuer or the Placement Agent and such successor escrow agent, then the
      resigning Escrow Agent shall deliver over to the successor escrow agent the
      Fund, less any portion thereof previously paid out in accordance with this
      Agreement; or (b) if the resigning Escrow Agent shall not have received written
      notice signed by the Issuer or the Placement Agent, and a successor escrow
      agent, then the resigning Escrow Agent shall promptly refund the amount in
      the
      Fund to each prospective purchaser, without interest thereon or deduction
      therefrom, and the resigning Escrow Agent shall promptly notify the Issuer
      and
      the Placement Agent in writing of its liquidation and distribution of the Fund;
      whereupon, in either case, the Escrow Agent shall be relieved of all further
      obligations and released from all liability under this Agreement. 

     

    7. Representations
      and Warranties.
      The
      Issuer and the Placement Agent hereby severally represent and warrant to the
      Escrow Agent that:

     

    7.1 No
      party
      other than the parties hereto and the prospective purchasers have, or shall
      have, any lien, claim or security interest in the Escrow Amounts or the Fund
      or
      any part thereof.

     

    7.2 No
      financing statement under the Uniform Commercial Code is on file in any
      jurisdiction claiming a security interest in or describing (whether specifically
      or generally) the Escrow Amounts or the Fund or any part thereof.

     

    7.3 The
      subscription information submitted with each deposit shall, at the time of
      submission and at the time of the disbursement of the Fund, be deemed a
      representation and warranty that such deposit represents a bona fide payment
      by
      the purchaser described therein for the amount of
      Securities set forth in such subscription information. 

     

    7.4 All
      of
      the information contained in the Information Sheet is, as of the date hereof,
      and will be, at the time of any disbursement of the Fund, true and
      correct.

     

    8. Fees
      and Expenses.
      The
      Escrow Agent shall be entitled to the Escrow Agent Fees set forth on the
      Information Sheet, payable by the Issuer as and when stated therein. In
      addition, the Issuer agrees to reimburse the Escrow Agent for any reasonable
      expenses incurred in connection with this Agreement, including, but not limited
      to, reasonable counsel fees of one counsel. The Escrow Agent confirms that
      no
      additional expenses shall be incurred absent extraordinary conditions.

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

     

    9. Indemnification
      and Contribution.

     

    9.1 The
      Issuer and the Placement Agent (collectively referred to as the “Indemnitors”)
      jointly and severally agree to indemnify the Escrow Agent and its officers,
      directors, employees, agents and shareholders (collectively referred to as
      the
“Indemnitees”)
      against, and hold them harmless of and from, any and all loss, liability, cost,
      damage and expense, including without limitation, reasonable counsel fees,
      which
      the Indemnitees may suffer or incur by reason of any action, claim or proceeding
      brought against the Indemnitees arising out of or relating in any way to this
      Agreement or any transaction to which this Agreement relates, unless such
      action, claim or proceeding is the result of the willful misconduct or gross
      negligence of
      any of
      the
      Indemnitees.

     

    9.2 If
      the
      indemnification provided for in Section 9.1 is applicable, but for any reason
      is
      held to be unavailable, the Indemnitors shall contribute such amounts as are
      just and equitable to pay, or to reimburse the Indemnitees for, the aggregate
      of
      any and all losses, liabilities, costs, damages and expenses, including
      reasonable counsel fees, actually incurred by the Indemnitees as a result of
      or
      in connection with, and any amount paid in settlement of, any action, claim
      or
      proceeding arising out of or relating in any way to any actions or omissions
      of
      the Indemnitors.

     

    9.3 The
      provisions of this Section 9 shall survive any termination of this Agreement,
      whether by disbursement of the Fund, resignation of the Escrow Agent or
      otherwise.

     

    10. Governing
      Law and Assignment.
      This
      Agreement shall be construed in accordance with and governed by the laws of
      the
      State of New York and shall be binding upon the parties hereto and their
      respective successors and assigns; provided,
      however,
      that
      any assignment or transfer by any party of its rights under this Agreement
      or
      with respect to the Escrow Amounts or the Fund shall be void as against the
      Escrow Agent unless (a) written notice thereof shall be given to the Escrow
      Agent; and (b) the Escrow Agent shall have consented in writing to such
      assignment or transfer.

     

    11. Notices.
      All
      notices required to be given in connection with this Agreement shall be sent
      by
      registered or certified mail, return receipt requested, or by hand delivery
      with
      receipt acknowledged, or by the Express Mail service offered by the United
      States Postal Service, or by overnight courier, and addressed, if to the Issuer
      or the Placement Agent, at their respective addresses set forth on the
      Information Sheet, and if to the Escrow Agent, at its address set forth
      above.

     

    12. Severability.
      If any
      provision of this Agreement or the application thereof to any person or
      circumstance shall be determined to be invalid or unenforceable, the remaining
      provisions of this Agreement or the application of such provision to persons
      or
      circumstances other than those to which it is held invalid or unenforceable
      shall not be affected thereby and shall be valid and enforceable to the fullest
      extent permitted by law.

     

    13. Execution
      in Several Counterparts.
      This
      Agreement may be executed in several counterparts or by separate instruments,
      and all of such counterparts and instruments shall constitute one agreement,
      binding on all of the parties hereto.

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

     

    14. Entire
      Agreement.
      This
      Agreement constitutes the entire agreement between the parties hereto with
      respect to the subject matter hereof and supersedes all prior agreements and
      understandings (written or oral) of the parties in connection
      therewith.

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

    

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

     

    
      	 	
              AMERICAN STOCK TRANSFER & TRUST COMPANY

            
	 	 
	 	 
	 	
              By:

            	
                /s/ Herbert J. Lemmer

            	
            
	 	 	
              Name: Herbert J. Lemmer

            
	 	 	
              Title:  Vice President

            
	 	 
	 	 
	 	
              CHINA ADVANCED CONSTRUCTION MATERIALS

              GROUP, INC.

            
	 	 
	 	 
	 	
              By:

            	
                /s/ Xianfu Han

            	
            
	 	 	
              Name: Xianfu Han

            
	 	 	
              Title:  Chief Executive Officer

            
	 	 
	 	 
	 	
              MAXIM
                GROUP LLC

            
	 	 
	 	 
	 	
              By:

            	
                /s/ Clifford A. Teller

            	
            
	 	 	
              Name: Clifford A. Teller

            
	 	 	
              Title:  Director of Investment Banking

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      A

    

    ESCROW
      AGREEMENT INFORMATION SHEET

    

    
      	
              1.

            	
                The
                Issuer

            
	 	 	 
	 	
                Name:
                

            	
              China
                Advanced Construction Materials Group, Inc.

            
	 	
                Address:
                

            	
              c/o
                Xin Ao Construction Materials, Inc.

            
	 	 	
              Yingu
                Plaza 9, Beishuanxi Road, Suite 1708

            
	 	 	
              Haidan
                District, Beijing 100080 PRC

            

    

    

    State
      of
      incorporation of organization: Delaware

    

    
      	
              2.

            	
                The
                Placement Agent

            
	 	 	 
	 	
                Name:
                

            	
              Maxim
                Group LLC

            
	 	
                Address:
                

            	
              405
                Lexington Avenue

            
	 	 	
              New
                York, New York 10174

            

    

    

    3.           The
      Securities

     

    Description
      of the securities to be offered: 875,000 Units (each consists of one share
      of
      the Company’s Series A Convertible Preferred Stock and one warrant to purchase
      two (2) shares of the Company’s Common Stock) to accredited investors only, on a
“best efforts” basis, at a purchase price of $8.00 per unit. The warrants will
      expire in five years and have an exercise price of $2.40.

     

    4.           Minimum
      Amounts and Conditions Required for Disbursement of the Escrow
      Account

     

    Aggregate
      dollar amount that must be collected before the Escrow Account may be disbursed
      to the Issuer: There is no minimum.

    

    5.           Plan
      of Distribution of the Securities:

     

    Initial
      Offering Period: Through June 15, 2008

    Extension
      Period: Up to June 30, 2008

    

     

    6.            Title
      of Escrow Account

     

    “China
      Advanced Construction Materials Group Escrow Account”

    

    7.            Account
      Number

    

    8.           Escrow
      Agent Fees and Charges

     

    $2,500:
      payable at the Closing

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