Document:

Unassociated Document

    SHARE
      ESCROW AGREEMENT

    

    THIS
      SHARE ESCROW AGREEMENT (“Agreement”),
      is
      made as of October 14, 2008, by and between China Bio Energy Holding Group
      Co.,
      Ltd. (the “Company”),
      the
      Purchaser whose name is set forth on Exhibit
      A
      to the
      Securities Purchase Agreement, dated this same date (the “Purchaser”
and
      together with the Company, the “Parties”),
      Redsky Group Limited, a British Virgin Islands company (“Redsky
      Group”),
      and
      Loeb & Loeb LLP, with offices at 345 Park Avenue, New York, NY 10154 (the
“Escrow
      Agent”).

    

    RECITALS:

    

    
      	 	
              (1)

            	
              Pursuant
                to that certain Securities Purchase Agreement, dated as of October
                14,
                2008, by and between the Company and the Purchaser (the “Purchase
                Agreement”),
                a copy of which is attached hereto as Exhibit
                A
                and incorporated herein by reference, the Company issued to the Purchaser
                a convertible debenture in the amount of $9,000,000, which is
                automatically convertible into 2,465,753 shares of the Company’s Series B
                Convertible Preferred Stock, subject to adjustment pursuant to the
                Certificate of Designation of the Relative Rights and Preferences
                of the
                Series B Convertible Preferred Stock, and is referred to herein as
                the
                “Convertible
                Debenture”).
                Capitalized terms used in this Agreement without definition, have
                the
                meaning assigned to those terms in the Purchase Agreement;
                

            

    

    

    
      	 	
              (2)

            	
              To
                induce the Purchaser to enter into the Purchase Agreement, Redsky
                Group
                Limited, a British Virgin Islands company (“Redsky
                Group”),
                the majority stockholder of the Company, has agreed to deposit 2,465,753
                shares of the Company’s Common Stock it owns (“Escrow
                Shares”),
                into an escrow account to be held by the Escrow Agent to be disbursed
                in
                accordance with the terms and conditions set forth herein, (the
                “Escrow
                Account”);
                

            

    

    

    
      	 	
              (3)

            	
              The
                Company and the Purchaser have requested that the Escrow Agent hold
                the
                Escrow Shares 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.

            

    

     

    NOW,
      THEREFORE, in consideration of the covenants and mutual promises contained
      herein and other good and valuable consideration, the receipt and legal
      sufficiency of which are hereby acknowledged and intending to be legally bound
      hereby, the Parties agree as follows:

    

    ARTICLE
      1

    TERMS
      OF
      THE ESCROW

    

    1.1  Appointment
      of Escrow Agent.
      The
      Parties hereby agree to have Loeb & Loeb LLP act as Escrow Agent to receive
      the Escrow Shares in escrow and distribute the same as set forth in this
      Agreement. 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    1.2 Escrow
      Deposit.
      In
      accordance with the terms of the Purchase Agreement, immediately prior to the
      Closing, Redsky Group shall deliver the Escrow Shares to the Escrow Agent.
      The
      Escrow Agent shall hold the Escrow Shares in the Escrow Account at all times
      until such Escrow Shares are disbursed in accordance herewith; 

    

    1.3 Performance
      Thresholds

    

    (a) The
      performance thresholds for the fiscal year ended December 31, 2008 shall be
      audited Net Income equal to $28,000,000 and Fully Diluted Earnings Per Share
      (as
      defined below) equal to $0.73 (the “Performance
      Thresholds”).
      

    

    (b) Whether
      the Performance Thresholds have been met shall be determined on the date the
      Company’s audited financial statements for the corresponding fiscal year are
      filed with the Securities and Exchange Commission pursuant to the reporting
      requirements of the Securities Exchange Act of 1934 (the “Exchange
      Act”),
      as
      amended, which includes any extensions with respect thereof pursuant to Rule
      12b-25 of the Exchange Act (such date being hereinafter referred to as the
      “Audit
      Date”);
      and,
      if the Company is not required to file reports pursuant to Section 13(a) or
      15(d) of the Exchange Act, and therefore prepares and furnishes the documents
      required by Section 6 of the Registration Rights Agreement, the Performance
      Thresholds shall be determined in accordance with such prepared documents and
      at
      such time.

    

    (c) With
      respect to the Performance Thresholds, “Net Income” shall be defined in
      accordance with US GAAP and reported by the Company in its audited financial
      statements for 2008, plus
      any
      amounts that may have been recorded as non-cash charges or liabilities on the
      2008 financial statements, respectively, due to the application of EITF No.
      00-19 that are associated with (i) any outstanding Warrants of the Company,
      (ii)
      the transactions contemplated by this Agreement, including, without limitation
      the release of any Escrow Shares to Redsky Group, (iii) any issuance of shares
      of Common Stock or option grants under a performance based stock incentive
      plan
      that was in existence on the Closing Date, and (iv) the conversion of any shares
      of preferred stock. “Fully Diluted Earnings Per Share” means after tax Net
      Income divided by the number of shares of Common Stock outstanding on a fully
      diluted basis, which number of shares of Common Stock shall include, without
      limitation, (x) the number of shares of Common Stock issuable upon conversion
      of
      the Company’s then outstanding shares of Series A Preferred and Series B
      Preferred, and (y) the number of shares of Common Stock issuable upon the
      exercise of any then outstanding warrants, options or other securities
      convertible into shares of Common Stock of the Company, as of December 31,
      2008.

    

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    1.4 Escrow
      Release

    

    The
      Purchaser shall remit written instructions to the Escrow Agent two (2) business
      days after the Audit Date, in the form of Exhibit
      B
      attached
      hereto and made a part hereof, or in a form and substance satisfactory to the
      Escrow Agent (the “Release
      Notice”),
      directing the Escrow Agent to release the Escrow Shares within five (5) business
      days of the Escrow Agent’s receipt of the Release Notice as specified therein
      and in accordance with the following guidelines : 

    

    
      	 	
              (a)

            	
              If
                the Company achieves no more than 50% of the Performance Thresholds,
                the
                Escrow Agent shall disburse all of the Escrow Shares to the
                Purchaser.

            

    

    

    
      	 	
              (b)

            	
              If
                the Company achieves more than 50% and less than 100% of the Performance
                Thresholds, the Escrow Agent shall disburse to the Purchaser that
                number
                of Escrow Shares equal to two (2) times the percentage by which the
                Lowest
                Performance Threshold was not achieved. For purposes hereof, the
                “Lowest
                Threshold Percentage”
                means the percentage by which the lowest of the Performance Thresholds
                was
                not achieved. By way of example, if the Company’s Fully Diluted Earnings
                Per Share is an amount equal to 60% of the Performance Thresholds
                and the
                Company’s Net Income reported on is an amount equal to 70% of the
                Performance Thresholds, the Lowest Threshold Percentage would be
                40%
                (100%-60%). The Escrow Agent would disburse 80% of the Escrow Shares
                to
                the Purchasers (40*2).

            

    

    

    
      	 	
              (c)

            	
              In
                the event that the Company does not achieve the specified percentage
                of
                the Performance Thresholds as set forth in 1.4(a) and 1.4(b) above
                and the
                Purchaser sells any of its Series B Preferred Stock and/or Common
                Conversion Shares prior to the date of distribution of Escrow Shares,
                then
                the Purchaser shall only be entitled to receive that number of Escrow
                Shares equal to the sum of the number of shares of Series B Preferred
                Stock (on an as converted basis) and Common Conversion Shares owned
                by
                such Purchaser as of the date of distribution. Any Escrow Shares
                not
                delivered to the Purchaser because the Purchaser has sold any portion
                of
                such Purchaser’s Series B Preferred or Conversion Shares will be released
                to Redsky Group.

            

    

    

    
      	 	
              (d)

            	
              If
                the Performance Thresholds are achieved, all of the Escrow Shares
                shall be
                returned to Redsky Group.

            

    

    

    
      	 	
              (e)

            	
              In
                the event that the Closing of the transactions contemplated by the
                Purchase Agreement does not occur, and written notice of same, signed
                by
                all
                of
                the Parties hereto, is delivered to the Escrow Agent, the Escrow
                Agent
                shall return the Escrow Shares to Redsky Group.

            

    

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (f)

            	
              Upon
                the Escrow Agent’s completion of its obligations under Sections 1.4, this
                Agreement shall terminate and the Escrow Agent shall have no further
                liability hereunder. 

            

    

    

    1.5 This
      Agreement may be altered or amended only with the written consent of all of
      the
      Parties hereto. Should any of the Parties attempt to change this Agreement
      in a
      manner, which, in the Escrow Agent’s discretion, shall be undesirable, the
      Escrow Agent may resign as Escrow Agent by notifying the Parties in writing
      five
      days in advance. In the case of the Escrow Agent’s resignation or removal
      pursuant to the foregoing, his only duty, until receipt of notice from the
      Parties that a successor escrow agent has been appointed, shall be to hold
      and
      preserve the Escrow Shares that are in his possession. Upon receipt by the
      Escrow Agent of said notice from the Parties of the appointment of a successor
      escrow agent, the name of a successor escrow account and a direction to transfer
      the Escrow Shares, the Escrow Agent shall promptly thereafter transfer all
      of
      the Escrow Shares that it is still holding in escrow, to said successor escrow
      agent. Immediately after said transfer of the Escrow Shares, the Escrow Agent
      shall furnish the Parties with proof of such transfer. The Escrow Agent is
      authorized to disregard any notices, requests, instructions or demands received
      by it from the Parties after the Escrow Agent promptly transfers all of the
      Escrow Shares that it is still holding in escrow, to the above said successor
      escrow agent. 

     

    1.6
      The
      Escrow Agent shall be reimbursed by the Parties for any reasonable expenses
      incurred in the event there is a conflict between the Parties and the Escrow
      Agent shall deem it necessary to retain counsel, upon whose advice the Escrow
      Agent may rely. The Escrow Agent shall not be liable for any action taken or
      omitted by him in good faith and in no event shall the Escrow Agent be liable
      or
      responsible except for the Escrow Agent’s own gross negligence or willful
      misconduct. The Escrow Agent has made no representations or warranties to the
      Parties in connection with this transaction. The Escrow Agent has no liability
      hereunder to either party other than to hold the Escrow Shares and to deliver
      them under the terms hereof. Each party hereto agrees to indemnify and hold
      harmless the Escrow Agent from and with respect to any suits, claims, actions
      or
      liabilities arising in any way out of this transaction including the obligation
      to defend any legal action brought which in any way arises out of or is related
      to this Agreement or the investment being made by Purchaser. The
      Escrow Agent has acted as legal counsel for the Company and may continue to
      act
      as legal counsel for the Company from time to time, notwithstanding its duties
      as the Escrow Agent hereunder. The Company and the Purchaser consent to the
      Escrow Agent in such capacity as legal counsel for the Company and waive any
      claim that such representation represents a conflict of interest on the part
      of
      the Escrow Agent. The Company and the Purchaser understand that the Escrow
      Agent
      is relying explicitly on the foregoing provision in entering into this Share
      Escrow Agreement.

    

    1.7 The
      Escrow Agent shall be obligated only for the performance of such duties as
      are
      specifically set forth herein and may rely and shall be protected in relying
      or
      refraining from acting on any instrument reasonably believed by the Escrow
      Agent
      to be genuine and to have been signed or presented by the proper Party or
      Parties. The Escrow Agent shall not be personally liable for any act the Escrow
      Agent may do or omit to do hereunder as the Escrow Agent while acting in good
      faith, and any act done or omitted by the Escrow Agent pursuant to the advice
      of
      the Escrow Agent's attorneys-at-law shall be conclusive evidence of such good
      faith.

    

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

       

    

    1.8 The
      Escrow Agent is hereby expressly authorized to disregard any and all warnings
      given by any of the Parties hereto or by any other person or corporation,
      excepting only orders or process of courts of law and is hereby expressly
      authorized to comply with and obey orders, judgments or decrees of any court.
      In
      case the Escrow Agent obeys or complies with any such order, judgment or decree,
      the Escrow Agent shall not be liable to any of the Parties hereto or to any
      other person, firm or corporation by reason of such decree being subsequently
      reversed, modified, annulled, set aside, vacated or found to have been entered
      without jurisdiction.

    

    1.9 The
      Escrow Agent shall not be liable in any respect on account of the identity,
      authorities or rights of the Parties executing or delivering or purporting
      to
      execute or deliver the Agreement or any documents or papers deposited or called
      for hereunder.

    

    1.10 If
      the
      Escrow Agent reasonably requires other or further documents in connection with
      this Agreement, the necessary Parties hereto shall join in furnishing such
      documents.

    

    1.11 It
      is
      understood and agreed that should any dispute arise with respect to the delivery
      and/or ownership or right of possession of the documents, the Escrow Shares
      held
      by the Escrow Agent hereunder, the Escrow Agent is authorized and directed
      in
      the Escrow Agent's sole discretion (a) to retain in the Escrow Agent's
      possession without liability to anyone all or any part of said documents, the
      Escrow Shares until such disputes shall have been settled either by mutual
      written agreement of the Parties concerned or by a final order, decree or
      judgment of a court of competent jurisdiction after the time for appeal has
      expired and no appeal has been perfected, but the Escrow Agent shall be under
      no
      duty whatsoever to institute or defend any such proceedings or (b) to deliver
      the Escrow Shares and any other property and documents held by the Escrow Agent
      hereunder to a state or federal court having competent subject matter
      jurisdiction and located in the State of New York in accordance with the
      applicable procedure therefor.

    

    ARTICLE
      2

    MISCELLANEOUS

    

    2.1 No
      waiver
      of any breach of any covenant or provision herein contained shall be deemed
      a
      waiver of any preceding or succeeding breach thereof, or of any other covenant
      or provision herein contained. No extension of time for performance of any
      obligation or act shall be deemed any extension of the time for performance
      of
      any other obligation or act.

    

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

       

    

    2.2 All
      notices, demands, consents, requests, instructions and other communications
      to
      be given or delivered or permitted under or by reason of the provisions of
      this
      Agreement or in connection with the transactions contemplated hereby shall
      be in
      writing and shall be deemed to be delivered and received by the intended
      recipient as follows: (i) if personally delivered, on the business day of such
      delivery (as evidenced by the receipt of the personal delivery service), (ii)
      if
      mailed certified or registered mail return receipt requested, two (2) business
      days after being mailed, (iii) if delivered by overnight courier (with all
      charges having been prepaid), on the business day of such delivery (as evidenced
      by the receipt of the overnight courier service of recognized standing), or
      (iv)
      if delivered by facsimile transmission, on the business day of such delivery
      if
      sent by 6:00 p.m. in the time zone of the recipient, or if sent after that
      time,
      on the next succeeding business day (as evidenced by the printed confirmation
      of
      delivery generated by the sending party’s telecopier machine). If any notice,
      demand, consent, request, instruction or other communication cannot be delivered
      because of a changed address of which no notice was given (in accordance with
      this Section 2.2), or the refusal to accept same, the notice, demand, consent,
      request, instruction or other communication shall be deemed received on the
      second business day the notice is sent (as evidenced by a sworn affidavit of
      the
      sender). All such notices, demands, consents, requests, instructions and other
      communications will be sent to the following addresses or facsimile numbers
      as
      applicable.

    

    
      	
              If
                to Escrow Agent: 

            
	 	 
	 	
              Loeb
                & Loeb LLP

            
	 	
              345
                Park Avenue

            
	 	
              New
                York, New York 10154

            
	 	
              Attention:
                Mitchell Nussbaum, Esq.

            
	 	
              Tel
                No.:212-407-4000

            
	 	
              Fax
                No.: 212-407-4990

            
	 
	
              If
                to the Company or Redsky Group:

            
	 	
              China
                Bio Energy Holding Group Co., Ltd.

            
	 	
              c/oXi'an
                Baorun Industrial Development Co. Ltd.

            
	 	
              Dongxin
                Century Square, 7th Floor

            
	 	
              Xi'an
                East City High-tech Industrial Development Park

            
	 	
              Shannxi
                Province, P.R. China

            
	 	
              Attn:
                Mr. Gao Xincheng

            
	 	
              Tel:
                86 29 82682019

            
	 	
              Fax:
                86 29 82683629

            
	 
	
              With
                a copy to:

            	
              Loeb
                & Loeb LLP

            
	 	
              345
                Park Avenue

            
	 	
              New
                York, New York 10154

            
	 	
              Attention:
                Mitchell Nussbaum, Esq

            
	 	
              Tel
                No.:212-407-4000

            
	 	
              Fax
                No.: 212-407-4990

            
	 
	
              If
                to the Purchaser

            	
              Vision
                Opportunity China LP

            
	 	
              20
                W. 55th Street, 5th Floor

            
	 	
              New
                York, New York 10019

            
	 	
              Attention:
                Kim Gabriel

            
	 	
              Tel.
                No.: 212-849-8242

            
	 	
              Fax
                No.: 212-867-1416

            

    

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    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.

    

    2.3  This
      Agreement shall be binding upon and shall inure to the benefit of the permitted
      successors and assigns of the Parties hereto.

    

    2.4
       This
      Agreement is the final expression of, and contains the entire agreement between,
      the Parties with respect to the subject matter hereof and supersedes all prior
      understandings with respect thereto. This Agreement may not be modified,
      changed, supplemented or terminated, nor may any obligations hereunder be
      waived, except by written instrument signed by the Parties to be charged or
      by
      its agent duly authorized in writing or as otherwise expressly permitted
      herein.

    

    2.5  Whenever
      required by the context of this Agreement, the singular shall include the plural
      and masculine shall include the feminine. This Agreement may be executed in
      two
      or more counterparts, all of which taken together shall constitute one
      instrument. Execution and delivery of this Agreement by exchange of facsimile
      copies bearing the facsimile signature of a party shall constitute a valid
      and
      binding execution and delivery of this Agreement by such party. Such facsimile
      copies shall constitute enforceable original documents.

    

    2.6  The
      Parties hereto expressly agree that this Agreement shall be governed by,
      interpreted under, and construed and enforced in accordance of the laws of
      the
      State of New York. The Parties agree that any dispute arising under or with
      respect to or in connection with this Agreement, whether during the term of
      this
      Agreement or at any subsequent time, shall be resolved fully and exclusively
      in
      the federal or state courts resident in New York County, New York. 

     

    2.7  By
      signing this Agreement, the Escrow Agent becomes a party hereto only for the
      purpose of this Agreement; the Escrow Agent does not become a party to the
      Purchase Agreement or any related agreements.

    

    2.8  Each
      party acknowledges and agrees that this Agreement shall not be deemed prepared
      or drafted by any one party. In the event of any dispute between the Parties
      concerning this Agreement, the Parties agree that any rule of construction,
      to
      the effect that any ambiguity in the language of the Agreement is to be resolved
      against the drafting party, shall not apply. 

    

    (Signature
      Page to Follow)

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

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

    

    Executed:

    

    
      	
              China
                Bio Energy Holding Group Co., Ltd.

            
	 
	
              By:
                

            	 
              /s/ Gao Xincheng
	
              Name:
                Gao Xincheng

            
	
              Title:
                Chief Executive Officer

            
	 
	
              Vision
                Opportunity China LP

            
	 
	
              By:
                

            	 
              /s/ Adam Benowitz
	
              Name:
                Adam Benowitz

            
	
              Title:
                Authorized Signatory

            
	 
	
              Redsky
                Group Limited

            
	 
	
              By:
                

            	 
              /s/ Gao Xincheng
	
              Name:
                Gao Xincheng

            
	
              Title:
                Director

            
	 
	
              Escrow
                Agent:

            
	
              Loeb
                & Loeb LLP

            
	 
	
              By:
                

            	 
              /s/ Mitchell S. Nussbaum
	
              Name:
                Mitchell S. Nussbaum

            
	
              Title:
                Partner

            

    

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    Exhibit
      A

    Vision
      Opportunity China LP

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    Exhibit
      B

    

    FORM
      OF ESCROW RELEASE NOTICE

    

    Date:
      

    

    Escrow
      Agent

    

    Dear
      Escrow Agent:

    

    In
      accordance with the terms of Article 1 of the Escrow Agreement dated as of
      October 14, 2008 (the "Escrow Agreement"), by and between China Bio Energy
      Holding Group Co., Ltd. (the “Company”), the Purchaser whose name is set forth
      on Exhibit A to the Securities Purchase Agreement dated October __, 2008 (the
      “Purchaser,”
and
      together with the Company, the “Parties”), the Purchaser hereby notify the
      Escrow Agent of the following: 

     

    
      	 	
              1.

            	
              The
                Audit Date was ___________ __, 200__; and

            

    

     

    
      	 	
              2.

            	
              The
                Company achieved __% of the Performance Thresholds.
                

            

    

     

    Accordingly,
      please distribute the Escrow Shares as follows: 

    

    
      	
              Recipient
                Information

            	 	
              Amount
                of Escrow Shares to be
delivered

            
	 	 	 
	 	 	 
	 	 	 
	 	 	 

    

     

    Very
      truly yours,

    

     

    VISION
      OPPORTUNITY CHINA LP

    

    By:_____________

    Name:__________

    Title:___________

    

    
      
        
        

      

      
        10Unassociated Document

    MANAGEMENT
      ESCROW AGREEMENT

    

    THIS
      MANAGEMENT ESCROW AGREEMENT (“Agreement”)
      is
      made as of October 14, 2008 by and among China Bio Energy Holding Group Co.,
      Ltd. (the “Company”), the Purchaser whose name is set forth on Exhibit
      A
      to the
      Securities Purchase Agreement dated this same date (the “Purchaser”
and
      together with the Company, the “Parties”)
      and
      Loeb & Loeb LLP, with offices at 345 Park Avenue, New York, NY 10154 (the
“Escrow Agent”).

    

    RECITALS:

    

    
      	 	
              (1)

            	
              Pursuant
                to that certain Securities Purchase Agreement, dated as of October
                14,
                2008 by and between the Company and the Purchaser (the “Purchase
                Agreement”),
                a copy of which is attached hereto as Exhibit
                A
                and incorporated herein by reference, the Purchaser purchased a
                convertible debenture in the amount of $9,000,000, which is automatically
                convertible into 2,465,753 shares of the Company’s Series B Preferred
                Stock. The Company received proceeds in the amount of $9,000,000
                (the
                “Gross
                Proceeds”).
                Capitalized terms used in this Agreement without definition, have
                the
                meaning assigned to those terms in the Purchase Agreement;
                

            

    

    

    
      	 	
              (2)

            	
              To
                induce the Purchaser to enter into the Purchase Agreement, the Company
                agreed to deposit $750,000 of the Gross Proceeds (the “Escrow
                Funds”)
                into an escrow account at the Closing, to be held by the Escrow Agent
                for
                disbursement in accordance with the terms and conditions set forth
                herein;
                

            

    

    

    
      	 	
              (3)

            	
              This
                Agreement constitutes the Management Escrow Agreement referred to
                in the
                Purchase Agreement pursuant to which the Escrow Agent shall receive
                and
                disburse the Escrow Funds. 

            

    

    

    NOW,
      THEREFORE, in consideration of the covenants and mutual promises contained
      herein and other good and valuable consideration, the receipt and legal
      sufficiency of which are hereby acknowledged and intending to be legally bound
      hereby, the parties agree as follows:

    

    ARTICLE
      1

    TERMS
      OF
      THE ESCROW

    

    1.1  Appointment
      of Escrow Agent.
      The
      parties hereby agree to have Loeb & Loeb LLP act as Escrow Agent to receive
      the Escrow Funds in escrow and distribute the same as set forth in this
      Agreement. 

    

    1.2 Escrow
      Deposit

    

    (a) In
      accordance with the terms of the Purchase Agreement, immediately after the
      Closing, the Escrow Funds shall be wired to the Escrow Agent; and 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    (b) The
      Escrow Agent shall hold the Escrow Funds at all times until such Escrow Funds
      are disbursed in accordance herewith. 

    

    1.3 Escrow
      Release. The
      Escrow Agent will hold and disburse the Escrow Funds received by it pursuant
      to
      the terms of this Agreement, as follows:

     

    (a) The
      Escrow Funds shall remain in the escrow account and shall only be released
      by
      the Escrow Agent in accordance with Section 1.3(b) below upon the Escrow Agent’s
      receipt of joint written notice in the forms of Exhibits B, C and D hereto,
      as
      applicable, from the Company and Purchaser.

     

    (b) Pursuant
      to Section 3.14 of the Purchase Agreement, upon the Escrow Agent’s receipt of
      notice as provided in Section 1.3(a) above (i) Two Hundred Fifty Thousand
      Dollars ($250,000) shall be released from the Escrow Funds to the Company at
      such time that the Company appoints a new Chief Financial Officer, (ii) Two
      Hundred Fifty Thousand Dollars ($250,000) shall be released from the Escrow
      Funds to the Company at such time that the Company fulfills NASDAQ’s corporate
      governance requirements including, but not limited to, appointing three (3)
      independent directors to serve on its Board of Directors, as well as forming
      the
      Audit Committee and Compensation Committee, and (iii) Two Hundred Fifty Thousand
      Dollars ($250,000) shall be released from the Escrow Funds to the Company at
      such time that the Company appoints a new Vice President of Investor Relations.
      

     

    (c) In
      the
      event this Agreement, the Escrow Funds, or the Escrow Agent, in its capacity
      as
      the escrow agent under this Agreement, becomes the subject of litigation, or
      if
      the Escrow Agent determines it is necessary to do so for any other reason
      relating to litigation arising out of this Agreement or the Purchase Agreement,
      each of the Company and the Purchaser authorizes the Escrow Agent, at its option
      if not otherwise so required, to deposit the Escrow Funds with the clerk of
      the
      court in which the litigation is pending, and thereupon the Escrow Agent shall
      be relieved and discharged of any further responsibility with regard thereto
      to
      the extent determined by any such court. Each of the Company and the Purchaser
      further authorizes the Escrow Agent, if it receives conflicting claims to any
      of
      the Escrow Funds, is threatened with litigation, in its capacity as escrow
      agent
      under this Agreement, or if the Escrow Agent determines it is necessary to
      do so
      for any other reason relating to this Agreement, to interplead all interested
      parties in any court of competent jurisdiction and to deposit the Escrow Funds
      with the clerk of that court and thereupon the Escrow Agent shall be relieved
      and discharged of any further responsibility hereunder to the parties from
      which
      they were received to the extent determined by such court.

    

    (d) Upon
      receipt of the notice provided in Section 1.3(b) above, the Escrow Agent shall
      release the Escrow Funds as specified therein. The names and true signatures
      of
      each individual authorized to act singly on behalf of each of the Parties are
      stated in Exhibit
      E,
      which
      is attached hereto and made a part hereof. The Parties may each remove or add
      one or more of its authorized signers stated on Exhibit
      E
      by
      notifying the Escrow Agent of such change in accordance with this Agreement,
      which notice shall include the true signature for any new authorized
      signatories

    

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    (e) Upon
      the
      Escrow Agent’s completion of its obligations under Section 1.3, this Agreement
      shall terminate and the Escrow Agent shall have no further liability hereunder.
      

    

    1.4 This
      Agreement may be altered or amended only with the written consent of all of
      the
      parties hereto. Should any of the Parties attempt to change this Agreement
      in a
      manner, which, in the Escrow Agent’s discretion, shall be undesirable, the
      Escrow Agent may resign as Escrow Agent by notifying the Parties in writing
      five
      days in advance. In the case of the Escrow Agent’s resignation or removal
      pursuant to the foregoing, its only duty, until receipt of notice from the
      Parties that a successor escrow agent has been appointed, shall be to hold
      and
      preserve the Escrow Funds that are in his possession. Upon receipt by the Escrow
      Agent of said notice from the Parties of the appointment of a successor escrow
      agent, the name of a successor escrow account and a direction to transfer the
      Escrow Funds, the Escrow Agent shall promptly thereafter transfer all of the
      Escrow Funds that it is still holding in escrow, to said successor escrow agent.
      Immediately after said transfer of the Escrow Funds, the Escrow Agent shall
      furnish the Parties with proof of such transfer. The Escrow Agent is authorized
      to disregard any notices, requests, instructions or demands received by it
      from
      the Parties after the Escrow Agent promptly transfers all of the Escrow Funds
      that it is still holding in escrow, to the above said successor escrow agent.
      

    

    1.5
      The
      Escrow Agent shall be reimbursed by the Parties for any reasonable expenses
      incurred in the event there is a conflict between the Parties and the Escrow
      Agent shall deem it necessary to retain counsel, upon whose advice the Escrow
      Agent may rely. The Escrow Agent shall not be liable for any action taken or
      omitted by it in good faith and in no event shall the Escrow Agent be liable
      or
      responsible except for the Escrow Agent’s own gross negligence or willful
      misconduct. The Escrow Agent has made no representations or warranties to the
      Parties in connection with this transaction. The Escrow Agent has no liability
      hereunder to either Party other than to hold the Escrow Funds and to deliver
      them under the terms hereof. Each Party hereto agrees to indemnify and hold
      harmless the Escrow Agent from and with respect to any suits, claims, actions
      or
      liabilities arising in any way out of this transaction including the obligation
      to defend any legal action brought which in any way arises out of or is related
      to this Agreement or the investment being made by Seller. The
      Purchaser acknowledges and represents that it is not being represented in a
      legal capacity by Loeb & Loeb LLP and has had the opportunity to consult
      with its own legal advisors prior to the signing of this Agreement. The
      Purchaser acknowledges that the Escrow Agent is not rendering securities advice
      to it with respect to this Agreement. The Escrow Agent is acting as legal
      counsel for the Company in connection with the Purchase Agreement and related
      Transaction Documents and may continue to act as legal counsel for the Company,
      from time to time, notwithstanding its duties as the Escrow Agent hereunder.
      The
      Purchaser consents to the Escrow Agent acting in such capacity as legal counsel
      for the Company and waives any claim that such representation represents a
      conflict of interest on the part of the Escrow Agent. The Purchaser understands
      that the Escrow Agent is relying explicitly on the foregoing provisions
      contained in this Section 1.5 in entering into this Agreement.

    

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    

    1.6 The
      Escrow Agent shall be obligated only for the performance of such duties as
      are
      specifically set forth herein and may rely and shall be protected in relying
      or
      refraining from acting on any instrument reasonably believed by the Escrow
      Agent
      to be genuine and to have been signed or presented by the proper Party or
      Parties. The Escrow Agent shall not be personally liable for any act the Escrow
      Agent may do or omit to do hereunder as the Escrow Agent while acting in good
      faith, and any act done or omitted by the Escrow Agent pursuant to the advice
      of
      the Escrow Agent's attorneys-at-law shall be conclusive evidence of such good
      faith.

    

    1.7 The
      Escrow Agent is hereby expressly authorized to disregard any and all warnings
      given by any of the parties hereto or by any other person or corporation,
      excepting only orders or process of courts of law and is hereby expressly
      authorized to comply with and obey orders, judgments or decrees of any court.
      In
      case the Escrow Agent obeys or complies with any such order, judgment or decree,
      the Escrow Agent shall not be liable to any of the parties hereto or to any
      other person, firm or corporation by reason of such decree being subsequently
      reversed, modified, annulled, set aside, vacated or found to have been entered
      without jurisdiction.

    

    1.8 The
      Escrow Agent shall not be liable in any respect on account of the identity,
      authorities or rights of the parties executing or delivering or purporting
      to
      execute or deliver the Agreement or any documents or papers deposited or called
      for hereunder.

    

    1.9 If
      the
      Escrow Agent reasonably requires other or further documents in connection with
      this Agreement, the necessary parties hereto shall join in furnishing such
      documents.

    

    1.10 It
      is
      understood and agreed that should any dispute arise with respect to the Escrow
      Funds held by the Escrow Agent hereunder, the Escrow Agent is authorized and
      directed in the Escrow Agent's sole discretion (a) to retain in the Escrow
      Agent's possession without liability to anyone , the Escrow Funds until such
      disputes shall have been settled either by mutual written agreement of the
      parties concerned or by a final order, decree or judgment of a court of
      competent jurisdiction after the time for appeal has expired and no appeal
      has
      been perfected, but the Escrow Agent shall be under no duty whatsoever to
      institute or defend any such proceedings or (b) to deliver the Escrow Funds
      and
      any other property and documents held by the Escrow Agent hereunder to a state
      or federal court having competent subject matter jurisdiction and located in
      the
      State of New York in accordance with the applicable procedure
      therefor.

    

    ARTICLE
      2

    MISCELLANEOUS

    

    2.1
       No
      waiver
      of any breach of any covenant or provision herein contained shall be deemed
      a
      waiver of any preceding or succeeding breach thereof, or of any other covenant
      or provision herein contained. No extension of time for performance of any
      obligation or act shall be deemed any extension of the time for performance
      of
      any other obligation or act.

    

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

       

    

    2.2 This
      Agreement shall be binding upon and shall inure to the benefit of the permitted
      successors and assigns of the Parties hereto.

    

    2.3
       This
      Agreement is the final expression of, and contains the entire agreement between,
      the Parties with respect to the subject matter hereof and supersedes all prior
      understandings with respect thereto. This Agreement may not be modified,
      changed, supplemented or terminated, nor may any obligations hereunder be
      waived, except by written instrument signed by the Parties to be charged or
      by
      their respective agents duly authorized in writing or as otherwise expressly
      permitted herein.

    

    2.4
       Whenever
      required by the context of this Agreement, the singular shall include the plural
      and masculine shall include the feminine. This Agreement may be executed in
      two
      or more counterparts, all of which taken together shall constitute one
      instrument. Execution and delivery of this Agreement by exchange of facsimile
      copies bearing the facsimile signature of a Party shall constitute a valid
      and
      binding execution and delivery of this Agreement by such Party. Such facsimile
      copies shall constitute enforceable original documents.

    

    2.5 The
      Parties hereto expressly agree that this Agreement shall be governed by,
      interpreted under, and construed and enforced in accordance of the laws of
      the
      State of New York. The parties agree that any dispute arising under or with
      respect to or in connection with this Agreement, whether during the term of
      this
      Agreement or at any subsequent time, shall be resolved fully and exclusively
      in
      the federal or state courts resident in New York County, New York. 

     

    2.6 Any
      notice required or permitted hereunder shall be in writing and shall be
      effective (a) upon hand delivery by telex (with correct answer back received),
      telecopy, email or facsimile at the address or number designated below (if
      delivered on a business day during normal business hours where such notice
      is to
      be received), or the first business day following such delivery (if delivered
      other than on a business day during normal business hours where such notice
      is
      to be received) or (b) sent by commercial overnight courier such as UPS or
      Fedex
      The addresses for such communications shall be:

    

    
      	
              If
                to the Company:

            	
              China
                Bio Energy Holding Group Co., Ltd.

              c/oXi'an
                Baorun Industrial Development Co. Ltd.

              Dongxin
                Century Square,  7th Floor

              Xi'an
                East City High-tech Industrial Development Park

              Shannxi
                Province,  P.R. China

              Attn:
                Mr. Gao Xincheng

              Tel:
                86 29 82682019

              Fax:
                86 29 82683629

            

    

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    
      	
              with
                copies to (which shall not constitute notice):

            	
              Loeb
                & Loeb

              345
                Park Avenue

              New
                York, NY10154

              Attn:
                Mitchell S. Nussbaum

              Tel:
                212.407.4159

              Fax:
                212.407-4990

            
	 	 
	
              If
                to the Purchaser:

            	
              Vision
                Opportunity China LP

              20
                West 55th Street

              5th
                Floor

              New
                York, NY 10019

              Attn:
                Kim Gabriel

              Tel:
                212-849-8242

              Fax:
                212-867-1416

              Email: k.gabriel@visicap.com

            
	 	 
	
              If
                to the Escrow Agent:

            	
              Loeb
                & Loeb LLP

              345
                Park Avenue

              New
                York, NY 10154

              Attention:
                Mitchell S. Nussbaum. Esq.

              Telephone
                Number: 212-407-4159

              Facsimile
                Number: 212-4-7-4990

            

    

    

    2.7 By
      signing this Agreement, the Escrow Agent becomes a Party hereto only for the
      purpose of this Agreement; the Escrow Agent does not become a Party to the
      Purchase Agreement or any related agreements.

    

    2.8 Each
      Party acknowledges and agrees that this Agreement shall not be deemed prepared
      or drafted by any one Party. In the event of any dispute between the Parties
      concerning this Agreement, the Parties agree that any rule of construction,
      to
      the effect that any ambiguity in the language of the Agreement is to be resolved
      against the drafting Party, shall not apply. 

    

    (Signature
      Page to Follow)

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

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

    

    Executed:

    

    
      	
              China
                Bio Energy Holding Group Co., Ltd.

            
	 
	
              By:
                

            	 
              /s/ Gao Xincheng
	
              Name:
                Gao Xincheng

            
	
              Title:
                Chief Executive Officer

            
	 
	
              Vision
                Opportunity China LP

            
	 
	
              By:
                

            	 
              /s/ Adam Benowitz
	
              Name:
                Adam Benowitz

            
	
              Title:
                Authorized Signatory

            
	 
	
              Escrow
                Agent

            
	 
	
              Loeb
                & Loeb LLP

            
	 
	
              By:

            	 
              /s/ Mitchell S. Nussbaum
	
              Name:
                Mitchell S. Nussbaum

            
	
              Title:
                Partner

            

    

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    Exhibit
      A

    

    Securities
      Purchase Agreement

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    Exhibit
      B

     

    RELEASE
      NOTICE

     

    Pursuant
      to that Management Escrow Agreement dated as of October 14, 2008, by and among
      China Bio Energy Holding Group Co., Ltd. (the “Company”), the Purchaser whose
      name is set forth on Exhibit
      A
      to
      Securities Purchase Agreement dated as of the date thereof (the “Purchaser”),
      and Loeb & Loeb, LLP, as Escrow Agent, the Company hereby certifies that the
      Company has hired a Chief Financial Officer, and hereby requests disbursement
      of
      funds in the amount and manner described below (wire instructions
      attached).

    

    
      	
              Please
                disburse to:

            	 
	 	 
	
              Amount
                to disburse:

            	 
	 	 
	
              Form
                of distribution:

            	 
	 	 
	
              Payee:

            	 
	 	
              Name:

            	 
	 	
              Address:

            	 
	 	
              City/State:

            	 
	 	
              Zip:

            	 
	 
	 
	 

    

    

    
      	 	 	
              CHINA
                BIO ENERGY HOLDING
GROUP CO., LTD.

            
	 	 	 
	
              Date:

            	 	
            	 	
              By:

            	 
	 	 	
              Name:

            
	 	 	
              Title:

            
	 	 	 
	 	 	
              VISION
                OPPORTUNITY CHINA LP

            
	 	 	 
	
              Date:

            	 	
            	 	
              By:

            	 
	 	 	
              Name:

            
	 	 	
              Title:

            

    

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    Exhibit
      C

     

    RELEASE
      NOTICE

     

    Pursuant
      to that Management Escrow Agreement dated as of October 14, 2008, by and among
      China Bio Energy Holding Group Co., Ltd. (the “Company”), the Purchaser whose
      name is set forth on Exhibit
      A
      to the
      Securities Purchase Agreement dated as of the date thereof (the “Purchaser”),
      and Loeb & Loeb, LLP, as Escrow Agent, the Company hereby certifies that the
      Company has complied with all of the NASDAQ corporate governance requirements,
      and hereby requests disbursement of funds in the amount and manner described
      below (wire instructions attached).

     

    
      	
              Please
                disburse to:

            	 
	 	 
	
              Amount
                to disburse:

            	 
	 	 
	
              Form
                of distribution:

            	 
	 	 
	
              Payee:

            	 
	 	
              Name:

            	 
	 	
              Address:

            	 
	 	
              City/State:

            	 
	 	
              Zip:

            	 
	 
	 
	 

    

    

    
      	 	 	
              CHINA
                BIO ENERGY HOLDING
GROUP CO., LTD.

            
	 	 	 
	 	 	 
	
              Date:

            	 	
            	 	
              By:

            	 
	 	 	
              Name:

            
	 	 	
              Title:

            
	 	 	 
	 	 	
              VISION
                OPPORTUNITY CHINA LP

            
	 	 	 
	
              Date:

            	 	
            	 	
              By:

            	 
	 	 	
              Name:

            
	 	 	
              Title:

            

    

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    Exhibit
      D  

     

    RELEASE
      NOTICE

     

    Pursuant
      to that Management Escrow Agreement dated as of October 14, 2008, by and among
      China Bio Energy Holding Group Co., Ltd. (the “Company”), the Purchaser whose
      name is set forth on Exhibit
      A
      to the
      Securities Purchase Agreement dated as of the same date thereof (the
“Purchaser”), and Loeb & Loeb, LLP, as Escrow Agent, the Company hereby
      certifies that the Company has hired an Investor Relations Officer, and hereby
      requests disbursement of funds in the amount and manner described below (wire
      instructions attached).

     

    
      	
              Please
                disburse to:

            	 
	 	 
	
              Amount
                to disburse:

            	 
	 	 
	
              Form
                of distribution:

            	 
	 	 
	
              Payee:

            	 
	 	
              Name:

            	 
	 	
              Address:

            	 
	 	
              City/State:

            	 
	 	
              Zip:

            	 
	 
	 
	 

    

    

    
      	 	 	
              CHINA
                BIO ENERGY HOLDING

              GROUP
                CO., LTD.

            
	 	 	 
	
              Date:

            	 	
            	 	
              By:

            	 
	 	 	
              Name:

            
	 	 	
              Title:

            
	 	 	 
	 	 	
              VISION
                OPPORTUNITY CHINA LP

            
	 	 	 
	
              Date:

            	 	
            	 	
              By:

            	 
	 	 	
              Name:

            
	 	 	
              Title:

            

    

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    Exhibit
      E

     

    The
      Escrow Agent is authorized to accept instructions signed or believed by the
      Escrow Agent to be signed by any or all of the following individuals on behalf
      of each of the Company and Purchaser:

     

    
      	
              Name

            	 	
              True
                Signature

            
	 	 	 
	
              COMPANY
                AUTHORIZED SIGNATORY

            
	 	 	 
	
              Name

            	 	
              True
                Signature

            
	 	 	 
	
              Gao
                Xincheng

            	 	 
	 	 	 
	
              Li
                Gaihong

            	 	 
	 	 	 
	 	 	 
	
              PURCHASER
                AUTHORIZED SIGNATORY

            
	 	 	 
	
              Name

            	 	
              True
                Signature

            
	 	 	 
	
              Adam
                Benowitz

            	 	 

    

    

    
      
        
        

      

      
        12

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00148-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00148-of-00352.parquet"}]]