Exhibit 10.1

 

SHARE ESCROW AGREEMENT

 

This Share Escrow Agreement (this “Agreement”), dated as of December 18, 2018,
is entered into by and among Datasea Inc., a Nevada corporation (the “Company”),
Zhixin Liu, an individual and Chairman of the Board of Directors, Chief
Executive Officer, President, Interim CFO, Secretary and Treasurer of the
Company, Fu Liu, an individual and member of the Board of Directors of the
Company and the father of Zhixin Liu (together with Zhixin Liu, the
“Stockholders”, and each, a “Stockholder”), ViewTrade Securities, Inc., a
Delaware corporation (“ViewTrade”), and West Coast Stock Transfer, Inc., a
California corporation, as escrow agent (the “Escrow Agent”).

 

         WHEREAS, the Company is conducting an underwritten public offering (the
“Offering”) of its common stock, par value $0.001 per share (“Common Stock”),
with ViewTrade serving as representative of the underwriters;

 

         WHEREAS, as a condition to ViewTrade serving as representative of the
underwriters in the Offering, the Stockholders have agreed to place, in the
aggregate, a total of 14,250,000 shares of Common Stock (the “Escrow Shares”)
held by the Stockholders, in the exact amounts for each Stockholder as set forth
on Exhibit A attached hereto, into escrow with the Escrow Agent, on the terms
and conditions set forth herein; and

 

         WHEREAS, the Escrow Agent, which also serves as the Company’s transfer
agent (in such capacity, the “Transfer Agent”) has agreed to act as escrow agent
pursuant to the terms and conditions set forth herein.

 

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

 

Section 1. Appointment of Escrow Agent. The Stockholders and the Company hereby
appoint the Escrow Agent to act in accordance with the terms and conditions set
forth in this Agreement, and the Escrow Agent hereby accepts such appointment
and agrees to act in accordance with such terms and conditions.

 

Section 2. Establishment of Escrow; Restrictions on Transfer; No Short Sales. On
the date hereof, as a condition to the closing of the Offering, the Stockholders
shall deliver, or cause to be delivered, to the Escrow Agent, certificates
representing the Escrow Shares, along with stock powers executed in blank (or
such other signed instrument of transfer acceptable to the Transfer Agent). Each
Stockholder hereby irrevocably agrees that other than in accordance with this
Agreement, such Stockholder will not offer, pledge, sell, contract to sell, sell
any option or contract to purchase, purchase any option or contract to sell,
grant any option, right or warrant to purchase or otherwise transfer or dispose
of, directly or indirectly, or announce the offering of any of the Escrow Shares
(including any securities convertible into, or exchangeable for, or representing
the rights to receive Escrow Shares) or engage in any Short Sales (as defined
herein) with respect to any security of the Company. In furtherance thereof, the
Company will (a) place a stop order on all Escrow Shares, which shall expire as
to the applicable Escrow Shares on the date such Escrow Shares are disbursed in
accordance with the terms of this Agreement, and (b) notify the Transfer Agent
in writing of the stop order and the restrictions on such Escrow Shares under
this Agreement and direct the Transfer Agent not to process any attempts by
either Stockholder to resell or transfer any Escrow Shares before the date the
Escrow Shares are disbursed in accordance with the terms of this Agreement, or
otherwise in violation of this Agreement. For purposes hereof, “Short Sales”
include, without limitation, all “short sales” as defined in Rule 200
promulgated under Regulation SHO under the Securities Exchange Act of 1934, as
amended, and all types of direct and indirect stock pledges, forward sale
contracts, options, puts, calls, swaps and similar arrangements (including on a
total return basis), and sales and other transactions through non-U.S. broker
dealers or foreign regulated brokers.

 

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Section 3. Representations of each Stockholder and the Company. Each of the
Stockholders and the Company hereby represent and warrant, severally and not
jointly, as to itself only, to each of ViewTrade and the Escrow Agent as
follows:

 

 

(a)

Performance of this Agreement and compliance with the provisions hereof will not
violate any provision of any applicable law and will not conflict with or result
in any breach of any of the terms, conditions or provisions of, or constitute a
default under, or result in the creation or imposition of any lien, charge or
encumbrance upon, any of the properties or assets of such Stockholder or the
Company (as the case may be) pursuant to the terms of any indenture, mortgage,
deed of trust or other agreement or instrument binding upon such Stockholder or
the Company (as the case may be).

 

 

(b)

Each of the Stockholders and the Company has carefully considered and
understands his, her or its obligations and rights under this Agreement, and in
furtherance thereof (x) has consulted with his, her or its legal and other
advisors with respect thereto and (y) hereby forever waives and agrees that he,
she or it may not assert any equitable defenses in any proceeding involving the
Escrow Shares.

 

Section 4. Disbursement of the Escrow Shares. Each party hereto hereby agrees as
follows:

 

 

(a)

In the event that the Valuation of the Company for the fiscal year ending June
30, 2019 is greater than the previous highest Valuation of the Company during
the Escrow Period, then the Escrow Agent shall disburse, within five (5)
business days after receipt of joint written instructions of the Company and
ViewTrade, that number of Escrow Shares to the Stockholders (in accordance with
their respective ownership percentages) as determined by subtracting the
Valuation of the Company for the fiscal year ending June 30, 2019 from the
previous highest Valuation of the Company during the Escrow Period, divided by
the Offering Price (rounded up or down to the nearest whole share), not to
exceed the Escrow Shares.

 

 

(b)

In the event that the Valuation of the Company for the fiscal year ending June
30, 2020 is greater than the previous highest Valuation of the Company during
the Escrow Period, then the Escrow Agent shall disburse, within five (5)
business days after receipt of joint written instructions of the Company and
ViewTrade, that number of Escrow Shares to the Stockholders (in accordance with
their respective ownership percentages) as determined by subtracting the
Valuation of the Company for the fiscal year ending June 30, 2020 from the
previous highest Valuation of the Company during the Escrow Period, divided by
the Offering Price (rounded up or down to the nearest whole share), not to
exceed the Escrow Shares. 

 

 

(c)

In the event that the Valuation of the Company for the fiscal year ending June
30, 2021 is greater than the previous highest Valuation of the Company during
the Escrow Period, then the Escrow Agent shall disburse, within five (5)
business days after receipt of joint written instructions of the Company and
ViewTrade, that number of Escrow Shares to the Stockholders (in accordance with
their respective ownership percentages) as determined by subtracting the
Valuation of the Company for the fiscal year ending June 30, 2021 from the
previous highest Valuation of the Company during the Escrow Period, divided by
the Offering Price (rounded up or down to the nearest whole share), not to
exceed the Escrow Shares. 

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(d)

In the event that the Valuation of the Company for the fiscal year ending June
30, 2022 is greater than the previous highest Valuation of the Company during
the Escrow Period, then the Escrow Agent shall disburse, within five (5)
business days after receipt of joint written instructions of the Company and
ViewTrade, that number of Escrow Shares to the Stockholders (in accordance with
their respective ownership percentages) as determined by subtracting the
Valuation of the Company for the fiscal year ending June 30, 2022 from the
previous highest Valuation of the Company during the Escrow Period, divided by
the Offering Price (rounded up or down to the nearest whole share), not to
exceed the Escrow Shares. 

 

 

(e)

In the event that the Valuation of the Company for the fiscal year ending June
30, 2023 is greater than the previous highest Valuation of the Company during
the Escrow Period, then the Escrow Agent shall disburse, within five (5)
business days after receipt of joint written instructions of the Company and
ViewTrade, that number of Escrow Shares to the Stockholders (in accordance with
their respective ownership percentages) as determined by subtracting the
Valuation of the Company for the fiscal year ending June 30, 2023 from the
previous highest Valuation of the Company during the Escrow Period, divided by
the Offering Price (rounded up or down to the nearest whole share), not to
exceed the Escrow Shares. 

 

 

(f)

In the event that the Valuation of the Company for the fiscal year ending June
30, 2024 is greater than the previous highest Valuation of the Company during
the Escrow Period, then the Escrow Agent shall disburse, within five (5)
business days after receipt of joint written instructions of the Company and
ViewTrade, that number of Escrow Shares to the Stockholders (in accordance with
their respective ownership percentages) as determined by subtracting the
Valuation of the Company for the fiscal year ending June 30, 2024 from the
previous highest Valuation of the Company during the Escrow Period, divided by
the Offering Price (rounded up or down to the nearest whole share), not to
exceed the Escrow Shares.

 

 

(g)

In the event that the Company failed to fully and timely satisfy any of the
milestones set forth in subsections (a)–(e) above: (i) but satisfies the
milestone set forth in subsection (f), then the Escrow Agent shall disburse,
within five (5) business days after receipt of joint written instructions of the
Company and ViewTrade, all remaining Escrow Shares, not to exceed the total
number of Escrow Shares, that would have previously been disbursed as if all
previous milestones had been fully and timely achieved; or (ii) and failed to
satisfy the milestone set forth in subsection (f), then the Escrow Agent shall
disburse all remaining Escrow Shares, not to exceed the total number of Escrow
Shares, to the Company within ten (10) business days after the Company files its
Annual Report on Form 10-K with the Securities and Exchange Commission (the
“Commission”) for the fiscal year ending June 30, 2024, and upon written
instruction of ViewTrade, after which the Company shall immediately, and no
later than two (2) business days after receipt of such Escrow Shares, cancel
such Escrow Shares. The Company shall provide evidence of such cancellation to
ViewTrade, in a form reasonably satisfactory to ViewTrade, within five (5)
business days after such cancellation.

 

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(h)

In the event that the Company failed to satisfy all of the milestones set forth
in subsections (e) and (f), then the Escrow Agent shall disburse all remaining
Escrow Shares to the Company within ten (10) business days after the Company
files its Annual Report on Form 10-K with the Commission for the fiscal year
ending June 30, 2024, and upon written instruction of ViewTrade, after which the
Company shall immediately, and no later than two (2) business days after receipt
of such Escrow Shares, cancel such Escrow Shares. The Company shall provide
evidence of such cancellation to ViewTrade, in a form reasonably satisfactory to
ViewTrade, within five (5) business days after such cancellation.

 

 

(i)

In the event that the Company fails to timely file any Annual Report on Form
10-K for any fiscal year referenced in subsections (a)–(f) above (after taking
into account permitted extensions, or without approval of ViewTrade), then the
Escrow Agent shall disburse all remaining Escrow Shares to the Company within
ten (10) business days from the date that such Annual Report on Form 10-K was
due, and upon written instruction of ViewTrade, after which the Company shall
immediately, and no later than two (2) business days after receipt of such
Escrow Shares, cancel such Escrow Shares. The Company shall provide evidence of
such cancellation to ViewTrade, in a form reasonably satisfactory to ViewTrade,
within five (5) business days after such cancellation.

 

 

(j)

In the event that the Company amends, restates, and/or otherwise revises any of
its financial statements for any fiscal year identified in subsections (a)–(f)
above whereby the effect would be to cause the Company to not satisfy a
previously satisfied milestone, then the Stockholders shall immediately return
such previously disbursed Escrow Shares to the Escrow Agent to be held and
disbursed in accordance with the terms of this Agreement.

 

 

(k)

For the avoidance of doubt, each milestone, and any corresponding release of
Escrow Shares, requires that the Common Stock be then listed on a national
securities exchange as of the last date of each such fiscal year, and in no
event shall the number of shares of Common Stock released to the Stockholders be
greater than the total number of Escrow Shares.

 

 

(l)

The following terms have the following definitions:

 

                   “Revenue” shall be identical to the Revenue set forth in the
Company’s statement of income (loss) set forth in each applicable Annual Report
on Form 10-K for each fiscal year identified above.

 

                   “EBITDA” shall mean earnings before interest, taxes,
depreciation and amortization, as determined by generally accepted accounting
principles, consistently applied, including without limitation, an accrual for
bonuses (if any) payable to the Stockholders for the year for which EBITDA is
determined using figures identical to those in each applicable Annual Report on
Form 10-K for each fiscal year identified above, and excluding charges (if any)
for the release of the Escrow Shares from escrow hereunder.

 

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                   “Valuation” means, for a fiscal year, the greater of (a) such
fiscal year’s Revenue, as reported in the Company’s applicable Annual Report on
Form 10-K as filed with the Commission for such fiscal year, multiplied by 1.65
and (b) such fiscal year’s EBITDA, as calculated from the Company’s applicable
Annual Report on Form 10-K as filed with the Commission for such fiscal year,
multiplied by 18. 

 

                   “Offering Price” means $4.00.

 

                   “Escrow Period” means fiscal year June 30, 2018 through
fiscal year June 30, 2023.

 

 

(m)

Within five (5) business days after the timely filing (after taking into account
permitted extensions) of each Annual Report on Form 10-K for each fiscal year
referenced in each of the subsections (a)–(f) above, the Company shall provide
to ViewTrade its calculations of Revenue and EBITDA with respect to the fiscal
year then ended. In the event that the Company fails to deliver such
calculations to ViewTrade within such five (5) business day period, then it
shall be final, conclusive and binding on the parties that the Company failed to
achieve such milestones. Within five (5) business days after receipt of such
calculations, ViewTrade shall either (i) deliver written notice to the Company
of any dispute it has with respect to such calculations or (ii) execute joint
written instructions with the Company and provide such joint written
instructions to the Company approving the disbursement of the Escrow Shares. If
ViewTrade does not notify the Company of a dispute with respect to the
calculations within such five (5) business day period, such calculations will be
final, conclusive and binding on the parties. In the event that ViewTrade timely
delivers written notice of a dispute with respect to either calculation, then
ViewTrade and the Company shall negotiate in good faith to resolve such dispute.
If ViewTrade and the Company, notwithstanding such good faith efforts, fail to
resolve such dispute within ten (10) business days after ViewTrade advises the
Company of its objections, then ViewTrade and the Company shall jointly enter
arbitration in accordance with the rules and procedures of the AAA (as defined
below) for final determination of the calculations. As promptly as practicable
thereafter, ViewTrade and the Company shall each prepare and submit a
presentation to the Arbitrator (as defined in Section 16(b)). ViewTrade and the
Company shall use reasonable efforts to cause the Arbitrator to deliver its
determination, based solely upon the presentations by ViewTrade and the Company,
within thirty (30) days of the matters being referred to the Arbitrator. The
Arbitrator shall act as an arbitrator to determine, based upon the provisions of
this Section 4(m), only the disputed calculations, and the determination of each
amount of the disputed calculations shall be made in accordance with the
procedures set forth in this Section 4(m). All determinations made by the
Arbitrator will be final, conclusive and binding on all parties to this
Agreement and upon which a judgment may be entered by a court having
jurisdiction thereover.

 

Section 5. Duration. This Agreement shall terminate upon the disbursement of all
of the Escrow Shares in accordance with the terms of this Agreement.

 

Section 6. Escrow Shares. For so long as the Escrow Shares remain in escrow with
the Escrow Agent in accordance with the terms of this Agreement, (a) any
dividends payable in cash with respect to the Escrow Shares and all voting and
other shareholder rights (under law or pursuant to any documentation to which
the Company is a party or otherwise bound) applicable to the Escrow Shares shall
be paid to and retained by, as applicable, each Stockholder, but any dividends
payable in shares or other non-cash property shall be delivered to the Escrow
Agent to be held in accordance with the terms of this Agreement, and (b) should
the Escrow Agent receive cash dividends or voting materials, such items shall
not be held by the Escrow Agent, but shall be passed immediately on to each
Stockholder and shall not be invested or held for any time longer than is needed
to effectively re-route such items to each Stockholder. In the event that the
Escrow Agent receives a communication from the Company requiring the conversion
of the Escrow Shares to cash or the exchange of the Escrow Shares for that of an
acquiring company, then such cash or exchanged shares shall be redeposited with
the Escrow Agent. Each Stockholder shall be responsible for all of his or her
respective taxes resulting from any such conversion or exchange.

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

 

Section 8. Exculpation and Indemnification of Escrow Agent.

 

 

(a)

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

 

 

(b)

The Escrow Agent will not be liable for any action taken or omitted by it, or
any action suffered by it to be taken or omitted, absent gross negligence or
willful misconduct. The Escrow Agent may rely conclusively on, and will be
protected in acting upon, any order, notice, demand, certificate, or opinion or
advice of counsel (including counsel chosen by the Escrow Agent), statement,
instrument, report or other paper or document (not only as to its due execution
and the validity and effectiveness of its provisions, but also as to the truth
and acceptability of any information therein contained) which is reasonably
believed by the Escrow Agent to be genuine and to be signed or presented by the
proper person or persons. The duties and responsibilities of the Escrow Agent
hereunder shall be determined solely by the express provisions of this Agreement
and no other or further duties or responsibilities shall be implied, including,
but not limited to, any obligation under or imposed by any laws upon
fiduciaries. The Escrow Agent shall not be liable, directly or indirectly, for
any (i) damages, losses or expenses arising out of the services provided
hereunder, other than damages, losses or expenses which have been finally
adjudicated to have directly resulted from the Escrow Agent’s gross negligence
or willful misconduct, or (ii) special, indirect or consequential damages or
losses of any kind whatsoever (including, without limitation, lost profits),
even if the Escrow Agent has been advised of the possibility of such losses or
damages and regardless of the form of action.

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(c)

The Company and each Stockholder each hereby, jointly and severally, indemnify
and hold harmless the Escrow Agent and any of their principals, partners,
agents, employees and affiliates from and against any expenses, including
reasonable attorneys’ fees and disbursements, damages or losses suffered by the
Escrow Agent in connection with any claim or demand, which, in any way, directly
or indirectly, arises out of or relates to this Agreement or the services of the
Escrow Agent hereunder; except, that if the Escrow Agent is guilty of willful
misconduct or gross negligence under this Agreement, then the Escrow Agent, will
bear all losses, damages and expenses arising as a result of its own willful
misconduct or gross negligence. Promptly after the receipt by the Escrow Agent
of notice of any such demand or claim or the commencement of any action, suit or
proceeding relating to such demand or claim, the Escrow Agent, will notify the
other parties hereto in writing. For the purposes hereof, the terms “expense”
and “loss” will include all amounts paid or payable to satisfy any such claim or
demand, or in settlement of any such claim, demand, action, suit or proceeding
settled with the express written consent of the parties hereto, and all costs
and expenses, including, but not limited to, reasonable attorneys’ fees and
disbursements, paid or incurred in investigating or defending against any such
claim, demand, action, suit or proceeding. The provisions of this Section 8
shall survive the termination of this Agreement, and the resignation or removal
of the Escrow Agent.

 

Section 9. Compensation of Escrow Agent. The Escrow Agent shall be entitled to
compensation for its services as stated in the fee schedule attached hereto as
Exhibit B, which compensation shall be paid by the Company. The fee agreed upon
for the services rendered hereunder is intended as full compensation for the
Escrow Agent’s services as contemplated by this Agreement; provided, however,
that in the event that the Escrow Agent renders any material service not
contemplated in this Agreement, or there is any assignment of interest in the
subject matter of this Agreement, or any material modification hereof, or if any
material controversy arises hereunder, or the Escrow Agent is made a party to
any litigation pertaining to this Agreement, or the subject matter hereof, then
the Escrow Agent shall be reasonably compensated by the Company for such
extraordinary services and reimbursed for all costs and expenses, including
reasonable attorneys’ fees, occasioned by any delay, controversy, litigation or
event, and the same shall be recoverable from the Company. Prior to incurring
any costs and/or expenses in connection with the foregoing sentence and unless
required to prevent irreparable harm to the Escrow Agent, the Escrow Agent shall
be required to provide written notice to the Company of such costs and/or
expenses and the relevancy thereof and the Escrow Agent shall not be permitted
to incur any such costs and/or expenses which are not related to litigation
prior to receiving written approval from the Company, which approval shall not
be unreasonably withheld.

 

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Section 10. Resignation of the Escrow Agent. At any time, upon ten (10) business
days’ written notice to each of the other parties hereto, the Escrow Agent may
resign and be discharged from its duties as the Escrow Agent hereunder. As soon
as practicable after its resignation, the Escrow Agent will promptly turn over
to a successor escrow agent appointed by the Company, and reasonably acceptable
to ViewTrade, the Escrow Shares held hereunder upon presentation of a document
appointing the new escrow agent and evidencing its acceptance thereof. If, by
the end of the ten (10) business day period following the giving of notice of
resignation by the Escrow Agent, the Company shall have failed to appoint a
successor escrow agent, the Escrow Agent shall deposit the Escrow Shares as
directed by ViewTrade with the understanding that such Escrow Shares will
continue to be subject to the provisions of this Agreement.

 

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

 

Section 12. Notice. 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, on the business day of such delivery (as evidenced by the signed
certified mail card), (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), (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), or (v) if
delivered by email on the business day of such delivery (as evidenced by
delivery confirmation). 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 9), 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
addresses or facsimile numbers as applicable set forth on the signature page
hereto.

 

Section 13. Execution in Counterparts. This Agreement may be executed and
delivered in counterparts in any manner (paper, facsimile, electronic or other
means), each of which shall be deemed an original, but all of which together
shall constitute one and the same instrument.

 

Section 14. Assignment and Modification. This Agreement and the rights and
obligations hereunder of the Company may be assigned by the Company only
following the prior written consent of ViewTrade. This Agreement and the rights
and obligations hereunder of the Escrow Agent may be assigned by the Escrow
Agent only with the prior consent of the Company and ViewTrade. This Agreement
and the rights and obligations hereunder of each Stockholder may not be
assigned. This Agreement may not be changed orally or modified, amended or
supplemented without an express written agreement executed by all of the parties
hereto.  This Agreement is binding upon and intended to be for the sole benefit
of the parties hereto and their respective successors, heirs and permitted
assigns, and none of the provisions of this Agreement are intended to be, nor
shall they be construed to be, for the benefit of any third person.  No portion
of the Escrow Shares shall be subject to interference or control by any creditor
of any party hereto, or be subject to being taken or reached by any legal or
equitable process in satisfaction of any debt or other liability of any such
party hereto prior to the disbursement thereof to such party hereto in
accordance with the provisions of this Agreement.

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Section 15. Applicable Law. This Agreement shall be governed by and construed in
accordance with the internal substantive laws of the State of New York,
excluding, to the greatest extent a New York court would permit, the application
of the laws of any jurisdiction other than the State of New York.  Subject to
Section 16, each party hereto irrevocably and unconditionally consents to submit
to the exclusive jurisdiction of the state or federal courts in New York city in
the State of New York (the “New York Courts”) for any action, suit, or
proceeding arising out of or relating to this Agreement and the transactions
contemplated by this Agreement (and agrees not to commence any action, suit, or
proceeding relating thereto except in the New York Courts).  Each party hereto
irrevocably and unconditionally waives any objection to the laying of venue of
any action, suit, or proceeding arising out of this Agreement in the New York
Courts, and further irrevocably and unconditionally waives and agrees not to
plead or claim in any court that any such action, suit, or proceeding brought in
any New York Court has been brought in an inconvenient forum. The parties hereto
each hereby knowingly, voluntarily, irrevocably and intentionally waive the
right each may have to a trial by jury with respect to any litigation based
hereon or arising out of, under or in connection with this Agreement or the
subject matter thereof. This provision is a material inducement for the parties
to enter into this Agreement.

 

Section 16. Dispute Resolution.

 

 

(a)

Except with respect to disputes regarding the calculations of Revenue and Market
Capitalization as contemplated by Section 4, which shall be resolved solely in
accordance with Section 4(m), the parties agree to negotiate in good faith to
resolve any controversy or claim arising out of or related to this Agreement,
including the validity, interpretation or performance hereof. 

 

 

(b)

In the event the parties are unable to settle a dispute between them in
accordance with subsection (a) above, such dispute shall be referred to and
finally settled by arbitration in accordance with the Commercial Arbitration
Rules and Mediation Procedures of the American Arbitration Association (the
“AAA”).  The arbitration shall be conducted by the AAA before a single
arbitrator (the “Arbitrator”).  The place of the arbitration shall be in New
York, New York.  The arbitration shall be conducted in English.  Accordingly,
the parties hereby waive a judicial proceeding, except for enforcing the
arbitration awards or in cases in which the arbitral tribunal requires judicial
assistance, including through precautionary measures.  Each party hereto shall
bear its own costs, including arbitration costs, and attorneys’ fees.  Any award
rendered by the arbitrator may be entered in any court having jurisdiction
thereof.

 

9

 

 

(c)

Each party hereto agrees that monetary damages may not be an adequate remedy for
any breach of the provisions of this Agreement.  Accordingly, each party hereto
agrees that in the event of any threatened or actual breach of this Agreement,
the non-breaching party, in addition to any other remedies at law that it may
have, shall be entitled to seek equitable relief (including, among other things,
the remedies of injunction, specific performance or a combination of these
remedies) in any court of competent jurisdiction.

 

Section 17. Headings. The headings contained in this Agreement are for
convenience of reference only and shall not affect the construction of this
Agreement.

 

Section 18. Recitals.  The recitals herein above are hereby incorporated into
this Agreement as if fully stated herein.

 

Section 19. Merger or Consolidation. Any corporation or association into which
the Escrow Agent may be converted or merged, or with which it may be
consolidated, or to which it may sell or transfer all or substantially all of
its corporate trust business and assets as a whole or substantially as a whole,
or any corporation or association resulting from any such conversion, sale,
merger, consolidation or transfer to which the Escrow Agent is a party, shall be
and become the successor escrow agent under this Agreement and shall have and
succeed to the rights, powers, duties, immunities and privileges as its
predecessor, without the execution or filing of any instrument or paper or the
performance of any further act.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

10

 

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

 

 

Datasea Inc.

 

 

 

 

 

By:

/s/ Zhixin Liu

 

 

 

Name: Zhixin Liu

 

 

 

Title:  Chief Executive Officer

 

 

 

 

 

 

Address:

 

 

1 Xinghuo Rd. Changning Building, 11th Floor

 

Fengtai District, Beijing, People’s Republic of China 100070

 

Attention: Chief Executive Officer

 

Email: liuzhixin@shuhaixinxi.com

 

 

 

 

 

View Trade Securities, Inc.

 

 

 

 

 

By:

/s/ Douglas Aguililla

 

 

 

Name: Douglas Aguililla

 

 

Title:  Director

 

 

 

 

 

Address:

 

7280 W. Palmetto Park Road, Suite 310

 

Boca Raton, FL 33433

 

Attention: Douglas Aguililla

 

Email: dougagui@viewtrade.com

 

 

 

 

 

West Coast Stock Transfer, Inc.

 

 

 

 

 

By:

/s/ Frank Brickell

 

 

 

Name: Frank Brickell

 

 

Title:  President

 

 

 

 

 

Address:

 

721 N. Vulcan Ave. Ste. 205

 

Encinitas, CA 92024

 

Attention: Frank Brickell

 

Email: fbrickell@wcsti.com

 [Signature Page Continues]

 

[Signature Page to Escrow Agreement]

 

 
 

  /s/ Zhixin Liu     Zhixin Liu    

 

Address:

 

1 Xinghuo Rd. Changning Building, 11th Floor

 

Fengtai District, Beijing, People’s Republic of China 100070

 

 

 

 

/s/ Fu Liu

 

 

Fu Liu

 

 

 

 

 

Address:

 

1 Xinghuo Rd. Changning Building, 11th Floor

 

Fengtai District, Beijing, People’s Republic of China 100070

 

[End of Signature Page to Share Escrow Agreement]

 

[Signature Page to Escrow Agreement]

 

 
 

EXHIBIT A 

ESCROW SHARES

 

Name

Total Escrow Shares

Zhixin Liu

9,104,167

Fu Liu

5,145,833

Total

14,250,000

 

 
 

EXHIBIT B 

FEE SCHEDULE

 [SEE ATTACHED]