exhibit10-1.htm


    ESCROW
      AGREEMENT

     

    THIS
      ESCROW AGREEMENT (the “Escrow Agreement”) is made as of December 23, 2007, by
      and between Kinglake Resources, Inc. (the "KGLK" or "Party A"), a Nevada
      corporation; Orient Come Holdings Limited, a British Virgin Islands company
      ("Party A Subsidiary" or "Orient"); and the Beijing K's Media Advertising Ltd.
      Co., a limited liability company organized under the laws of the PRC ("Chinese
      Advertisement Company" or "Party B"); the persons listed on Schedule A hereto
      ("Party B Shareholders"); and Arnstein & Lehr LLP, a law firm ("Escrow
      Agent) (each of the parties hereto is a "Party" and, collectively, they are
      the
      "Parties").

     

    WITNESSETH

     

    WHEREAS,
      on or about December 23, 2007, Party A Subsidiary and KGLK entered into an
      Acquisition Agreement (the "Acquisition Agreement");

     

    WHEREAS,
      on or about December 23, 2007, Party A Subsidiary, KGLK and Party B and the
      Party B Shareholders entered into a Share Exchange Agreement (the "Share
      Exchange Agreement);

     

    WHEREAS,
      on or about December 23, 2007, Party A Subsidiary and Party B entered into
      a
      Business Cooperation Agreement (the "Business Cooperation"); and

     

    WHEREAS,
      as contemplated in the Share Exchange Agreement and Business Cooperation
      Agreement, Party A Subsidiary, KGLK, Party B and the Party B Shareholders intend
      that this Escrow Agreement shall delineate the escrow arrangements between
      Party
      A and the Party B Shareholders.

     

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

     

    1. Pursuant
      to the provisions of the Share Exchange Agreement, the 10,500,000 new issued,
      but not outstanding restricted common shares of KGLK (the "Escrowed Shares")
      will be deposited or held in an escrow account with the Escrow
      Agent.

     

    2. The
      10,500,000 new restricted common shares of KGLK will be distributed to Party
      B
      Shareholders according to the following terms and conditions:

     

    (a) Not
      later
      than 90 days after the end of the first anniversary of this Agreement, Party
      A
      will prepare and deliver to Party B and Escrow Agent with calculations setting
      forth in sufficient detail Party B's "RMB Before Tax Profit" for such one year
      period (the "One Year Tax Profit Report").  Such Report shall be
      prepared in accordance with generally accepted accounting principles applied
      on
      a consistent basis.  Party B shall have 15 days after receipt of such
      Report (the "Pretax Profit Objection Statement"), to provide Party A and Escrow
      Agent, in writing, with any objections Party A shall have to the calculations
      set forth in the One Year Tax Profit Report (the "Objections").  In
      the event that Party A and Escrow Agent have not received any such Objections
      within the objection period, the One Year Tax Profit Report shall be considered
      final and conclusive.  The number of shares to be released shall be
      determined in accordance with Appendix I.

     

    In
      the
      event the Escrow Agent and Party A receive one or more Objections within the
      applicable time period and are unable to resolve such Objections within twenty
      (20) days from the receipt of such notice, Party A and Party B hereto shall
      collectively agree upon an outside independent accounting firm which shall
      then
      be engaged to compile the information required to be included in the One Year
      Tax Profit Report.  Once complied, such Report shall be conclusive,
      and any Escrowed Shares due thereunder shall be paid by Escrow Agent to Party
      B
      on account of the Party B Shareholders with 15 days of the day
      hereof.  Any costs associated with the engagement of an outside
      accounting firm shall be shared equally by Party A and Party B
      Shareholders.

     

    (b) Not
      later
      than 90 days after the end of the second anniversary of this Agreement, Party
      A
      will prepare and deliver to Party B and Escrow Agent with calculations setting
      forth in sufficient detail Party B's "RMB Before Tax Profit" for such two year
      period (the "Two Year Tax Profit Report").  Such Report shall be
      prepared in accordance with generally accepted accounting principles applied
      on
      a consistent basis.  Party B shall have 15 days after receipt of such
      Report (the "Pretax Profit Objection Statement"), to provide Party A and Escrow
      Agent, in writing, with any objections Party A shall have to the calculations
      set forth in the Two Year Tax Profit Report (the "Objections").  In
      the event that Party A and Escrow Agent have not received any such Objections
      within the objection period, the Two Year Tax Profit Report shall be considered
      final and conclusive.  The number of shares to be released shall be
      determined in accordance with Appendix I.

     

    In
      the
      event the Escrow Agent and Party A receive one or more Objections within the
      applicable time period and are unable to resolve such Objections within twenty
      (20) days from the receipt of such notice, Party A and Party B hereto shall
      collectively agree upon an outside independent accounting firm which shall
      then
      be engaged to compile the information required to be included in the Two Year
      Tax Profit Report.  Once complied, such Report shall be conclusive,
      and any Escrowed Shares due thereunder shall be paid by Escrow Agent to Party
      B
      on account of the Party B Shareholders with 15 days of the day
      hereof.  Any costs associated with the engagement of an outside
      accounting firm shall be shared equally by Party A and Party B
      Shareholders.

     

    (c) Not
      later
      than 90 days after the end of the third anniversary of this Agreement, Party
      A
      will prepare and deliver to Party B and Escrow Agent with calculations setting
      forth in sufficient detail Party B's "RMB Before Tax Profit" for such three
      year
      period (the "Three Year Tax Profit Report").  Such Report shall be
      prepared in accordance with generally accepted accounting principles applied
      on
      a consistent basis.  Party B shall have 15 days after receipt of such
      Report (the "Pretax Profit Objection Statement"), to provide Party A and Escrow
      Agent, in writing, with any objections Party A shall have to the calculations
      set forth in the Three Year Tax Profit Report (the "Objections").  In
      the event that Party A and Escrow Agent have not received any such Objections
      within the objection period, the Three Year Tax Profit Report shall be
      considered final and conclusive.  The number of shares to be released
      shall be determined in accordance with Appendix I.

     

    In
      the
      event the Escrow Agent and Party A receive one or more Objections within the
      applicable time period and are unable to resolve such Objections within twenty
      (20) days from the receipt of such notice, Party A and Party B hereto shall
      collectively agree upon an outside independent accounting firm which shall
      then
      be engaged to compile the information required to be included in the Three
      Year
      Tax Profit Report.  Once complied, such Report shall be conclusive,
      and any Escrowed Shares due thereunder shall be paid by Escrow Agent to Party
      B
      on account of the Party B Shareholders with 15 days of the day
      hereof.  Any costs associated with the engagement of an outside
      accounting firm shall be shared equally by Party A and Party B
      Shareholders.

     

    3. Each
      Party shall use their best efforts to make available to the other Party all
      work
      papers, and other financial materials used in preparing the appropriate reports,
      and make such information available to such Parties' accountants or
      representatives at such reasonable times and upon reasonable notice at any
      time
      during the preparation (a) by Party A of the applicable report, (b) the
      review by Party B of the applicable report, and (c) the resolution by the
      Parties of any objections thereto.

     

    4. Appointment
      of Escrow
      Agent.  Parties hereby appoint the Escrow Agent as escrow agent
      upon the terms and conditions set forth herein, and the Escrow Agent hereby
      accepts such appointment.  This Escrow Agreement and the Escrow
      Agent’s obligations hereunder shall commence on the date first written
      above.

     

    5. Disbursement
      Into
      Court.  At any time, the Escrow Agent, in its sole discretion,
      may commence an action in the nature of interpleader in any court it deems
      appropriate, to determine ownership or disposition of the Escrowed Shares or
      it
      may deposit the Escrowed Shares with the clerk of any appropriate court or
      it
      may retain the Escrowed Shares pending receipt of a final, non-appealable order
      of a court having jurisdiction over all of the parties hereto directing to
      whom
      and under what circumstances the Escrowed Shares are to be disbursed and
      delivered.  During the pendency of any such action, the Escrow Agent
      may suspend the performance of any of its obligations under this Escrow
      Agreement until such dispute or uncertainty shall be resolved to the sole
      satisfaction of Escrow Agent or until a successor Escrow Agent shall have been
      appointed (as the case may be).  The Escrow Agent shall have no
      liability to all Parties or any other person with respect to any such suspension
      of performance or disbursement into court, specifically including any liability
      or claimed liability that may arise, or be alleged to have arisen, out of or
      as
      a result of any delay in the disbursement of the Escrowed Shares or any delay
      in
      or with respect to any other action required or requested of Escrow
      Agent.

     

    6. Limitation
      of Responsibility
      and Liability and Duties of the Escrow Agent.  The acceptance
      by the Escrow Agent of its duties as such under this Escrow Agreement is subject
      to the following terms and conditions, which all parties to this Escrow
      Agreement hereby agree shall govern and control with respect to the rights,
      duties, and liabilities of the Escrow Agent:

     

    (a) The
      Escrow Agent shall not be liable for any error in judgment or mistake of law
      or
      fact, or for any action taken or omitted to be taken by it, or any action
      suffered by it to be taken or omitted by it, in good faith and in the exercise
      of its own best judgment.  The Escrow Agent shall not be liable for
      any delay in delivering the Escrowed Shares to any party to this Escrow
      Agreement, absent its own gross negligence or willful misconduct.

     

    (b) The
      Escrow Agent shall not be bound by any notice or demand, or any waiver,
      modification, termination or rescission of this Escrow Agreement unless
      evidenced by a writing delivered to the Escrow Agent signed by all Parties
      and,
      if the duties or rights of the Escrow Agent are affected by any such
      modification of or waiver under this Escrow Agreement unless the Escrow Agent
      shall have given its prior written consent thereto.

     

    (c) The
      Escrow Agent shall be indemnified and held harmless by all Parties, upon demand
      by the Escrow Agent, from and against any claims, demands, losses, damages,
      liabilities, costs and expenses, including counsel fees and disbursements,
      (collectively, “Damages”) suffered by the Escrow Agent in connection with any
      action, suit or other proceeding involving any claim, or in connection with
      any
      claim or demand, which in any way directly or indirectly arises out of or
      relates to this Escrow Agreement, the services of the Escrow Agent hereunder,
      the monies or other property held by it hereunder or any such
      Damages.  Promptly after the receipt by the Escrow Agent of notice of
      any demand or claim or the commencement of any action, suit or proceeding,
      the
      Escrow Agent shall, if a claim in respect thereof shall be made against the
      other parties hereto, notify such parties thereof in writing; but the failure
      by
      the Escrow Agent to give such notice shall not relieve any party from any
      liability which such party may have to the Escrow Agent hereunder, except to
      the
      extent of actual prejudice demonstrated by such party.  The
      obligations of all Parties under this subsection shall survive any termination
      of this Escrow Agreement and the resignation or removal of the Escrow
      Agent.

     

    (d) The
      Escrow Agent may resign at any time and be discharged from its duties as Escrow
      Agent hereunder by its giving the other parties hereto prior written notice
      of
      at least seven (7) business days.  As soon as practicable after its
      resignation, the Escrow Agent shall turn over to a successor escrow agent
      appointed by the other parties hereto, jointly, all of the Escrowed Shares
      held
      hereunder upon presentation of the document appointing the new escrow agent
      and
      its acceptance thereof.  If no new escrow agent is so appointed within
      the twenty (20) day period following the giving of such notice of resignation,
      the Escrow Agent may deposit the Escrowed Shares with any court it deems
      appropriate.

     

    (e) The
      Escrow Agent is authorized, in its sole discretion, to comply with orders issued
      or process entered by any court with respect to the Escrowed Shares, without
      determination by the Escrow Agent of such court’s jurisdiction in the
      matter.  If any portion of the Escrowed Shares is at any time
      attached, garnished or levied upon under any court order, or in case the
      payment, assignment, transfer, conveyance or delivery of any such property
      shall
      be stayed or enjoined by any court affecting such property or any part thereof,
      then and in any such event, the Escrow Agent is authorized, in its sole
      discretion, to rely upon and comply with any such order, writ, judgment or
      decree which it is advised by legal counsel selected by it is binding upon
      it
      without the need for appeal or other action; and if the Escrow Agent complies
      with any such order, writ, judgment or decree, it shall not be liable to any
      of
      the parties hereto or to any other person or entity by reason of such compliance
      even though such order, writ, judgment or decree may be subsequently reversed,
      modified, annulled, set aside or vacated.

     

    7. Governing
      Law; Jurisdiction,
      Venue.  This Escrow Agreement, and all proceedings hereunder,
      shall be governed by and construed in accordance with the domestic laws of
      the
      State of Florida without giving effect to any choice or conflict of law
      provision or rule (either of the State of Florida or any other jurisdiction)
      that would cause the application of the laws of any jurisdiction other than
      the
      State of Florida.  Each party to this Escrow Agreement hereby submits
      to exclusive jurisdiction of any state or federal court within Broward County,
      Florida for purposes of all legal proceedings arising out of or relating to
      this
      Escrow Agreement or the transactions contemplated hereby.  Each party
      to this Escrow Agreement hereby irrevocably waives, to the fullest extent
      permitted by law, any objections which it may now or hereafter have to the
      laying of the venue of any such proceeding brought in such a court and any
      claim
      that any such proceeding brought in such a court has been brought in an
      inconvenient forum.

     

    8. Notices.  All
      notices and communications shall be deemed to have been duly given: at the
      time
      (a) when received, if deposited in the mail, postage prepaid, addressed as
      provided below; (b) when transmission is verified, if telecopied; and (c) on
      the
      next business day, if timely delivered to a courier service guaranteeing
      overnight delivery; provided that the Escrow Agent shall have no obligation
      hereunder unless notice is actually received by it;

     

    If
      to
      Party
      A:                                         
Kinglake Resources, Inc.

    Suite
      500-666

    Burrard
      Street, Vancouver, BC

    V6C
      3P6,
      Canada

    Attention:  Jake
      Wei

    


    
      	
               

            	
              With
                a copy to:

            	
              Arnstein
                & Lehr LLP 

            


    

    
      	
               

            	
               200
                East Las Olas Boulevard 

            


    

    
      	
               

            	
              Suite
                1700 

            


    

    
      	
               

            	
              Fort
                Lauderdale, FL 33301 

            


    

    Attention:  Joel
      D.
      Mayersohn, Esq.

    


    If
      to
      Party A
      Subsidiary:                                                      
Orient Come Holdings Limited

    Room
      810,
      Block C2

    Oriental
      Plaza, No. 1 Chang An Street

    Beijing,
      China 100738

    Attention:  Ke
      Wang

    


    If
      to Party
      B:                                                      
Beijing K's Media Advertising Ltd. Co.

    Room
      211, No. 31

    Yan
      Xi Street, Yan Xi Economic
      Zone

    Huai
      Rou District, Beijing,
      China

    Attention:  Kun
      Wei

    


    


    If
      to the Escrow
      Agent:                                                      
Arnstein & Lehr LLP

    
      	
               

            	
              200
                East Las Olas Boulevard 

            


    

    
      	
               

            	
              Suite
                1700 

            


    

    
      	
               

            	
              Fort
                Lauderdale, Florida 33301 

            


    

    Attention:  Joel
      D.
      Mayersohn, Esq.

    Facsimile
      No.: (954) 713-7700

    


    If
      to Party B
      Shareholders:                                                                
Beijing K's Media Advertising Ltd. Co.

    Room
      211, No. 31

    Yan
      Xi Street, Yan Xi Economic
      Zone

    Huai
      Rou District, Beijing,
      China

    Attention:  Yan
      Zhuang

    


    Any
      party
      may change its address by providing written notice of such change to the other
      parties hereto.  All notices and communications provided by Buyer
      and/or Seller to the Escrow Agent shall be signed by duly authorized persons
      of
      each.

     

    9. Termination
      of Escrow
      Agreement.  The Escrow Agent’s responsibilities hereunder shall
      terminate upon the earliest to occur of the termination of this Escrow Agreement
      by mutual consent of Parties, the disbursement of the Escrowed Shares pursuant
      to this Agreement hereof, the disbursement of the Escrowed Shares into court
      pursuant to this Agreement hereof, and the resignation of the Escrow Agent
      pursuant to this Agreement hereof.

     

    10. Entire
      Escrow
      Agreement.  This Escrow Agreement contains the entire
      understanding by and among the parties hereto with respect to the subject matter
      hereof; there are no promises, agreements, understandings, representations
      or
      warranties, other than as herein set forth.  No change or modification
      of this Escrow Agreement shall be valid or effective unless the same is in
      writing and is signed by all of the parties hereto.

     

    11. Counterparts.  This
      Escrow Agreement may be executed in two or more counterparts, each of which
      shall be deemed an original, but all of which shall constitute one and the
      same
      agreement.

     

    12. Waive
      of
      Conflicts.  Parties hereby acknowledge that Escrow Agent has
      represented Party A in connection with certain acquisitions, securities matters,
      general corporate counseling, and various other matters, and hereby waive any
      and all conflicts of interest arising as a result of said
      representation.  Parties further acknowledge that Escrow Agent may
      represent Party A in the future, and hereby consent to any such
      representation.

     

    13. Party
      B
      Shareholders appoint Yan Zhuang (the “Designee”) to serve as their authorized
      representative and give Designee the authority to act on their behalf under
      the
      terms of this Agreement.

     



    IN
      WITNESS WHEREOF, the parties hereto have caused their respective hands to be
      set
      hereto with the intention of being bound effective in all respects as of the
      date first written above.

     

    Kinglake
      Resources, Inc.

    


    By:
      /s/ Jake
      Wei                                                                           


    Name:                                                                           Jake
      Wei

    Its:
      President                                                                           


    


    


    Orient
      Come Holdings Limited

    


    By:           
      /s/ Ke Wang                                                                


    Name:
      Ke
      Wang                                                                           


    Its:           
      President                                                                


    


    


    Beijing
      K's Media Advertising Ltd. Co.

    


    By:           
      /s/ Kun (James)
      Wei                                                                


    Name:                                                                           Kun
      (James) Wei

    Its:           
      President                                                                


    


    


    Party
      B's
      Shareholders

    


    /s/
      Yan Zhuang                                                                         


    Yan
      Zhuang

     

    /s/
      Yong Lu                                                             


    Yong
      Lu

     

    /s/
      Lin Chang                                                                   


    Lin
      Chang

     

    /s/
      LiHong Wu                                                             


    LiHong
      Wu

     

    /s/
      Qing Ya Wang                                                                   


    QingYa
      Wang

     

    


    Arnstein
      & Lehr LLP

    


    By:
      /s/ Joel D.
      Maysohn

          Joel
      D. Mayersohn



    SCHEDULE
      A

     

    List
      of Shareholders

     

    


    Yan
      Zhuang

     

    Yong
      Lu

     

    Lin
      Chang

     

    LiHong
      Wu

     

    QingYa
      Wang

     



    APPENDIX
      I

     

    Release
      Formula

     

    
      	
              KTV
                Financial Projection

            	

            	

            	

            
	
              In
                US Dollar

            	
              Year
                1

            	
              Year
                2

            	
              Year
                3

            
	
              Cash
                Inflow

            	 	 	

            
	
              Signed
                Sales

            	
              2,118,789

            	
              15,980,447

            	
              36,929,605

            
	
              90%
                of Signed Sales

            	
              1,906,911

            	
              14,382,403

            	
              33,236,645

            
	
              50%
                of Signed Sales

            	
                     1,059,395

            	
                    7,990,224

            	
                    18,464,803

            
	 	 	 	 
	
              Release
                Formula:

            	 	 	 
	
              Notes:

            	 	 	 
	
              1.
                KTV Management Team refers to: Zhuang, Yan; Lu, Yong; Chang, Lin;
                Wu,
                LiHong (4 persons). Each of them will receive 25% of total released
                shares.

            
	 	 	 	 
	
              2.
                KTV Management Team are entitled to have 75% of the Escrow Share,
                that is
                10,500,000 X 75% = 7,875,000. Each year, they can have up to 2,625,000
                shares. Release Formula (1) apply to KTV Management Team Release
                Formula
                (1) applies to KTV Management Team

            
	 	 	 	 
	
              3.
                Wang, QingYa (1 person) is entitled to have 25% of the Escrow Share,
                that
                is 10,500,000 X 25% = 2,625,000. Each year, he can have up to
                875,000.

              Release
                Formula (2) applies to him.

            
	 	 	 	 
	
              Release
                Formula (1):

            	 	 	 
	
              Year
                1:

            	 	 	 
	
              If
                K's Media achieved >=90% of Year 1 Signed Sales, that is
                >=US$1,900,000,  release 2,625,000 to KTV Management
                Team

            
	 	 	 	 
	
              If
                K's Media achieved <50% of Year 1 Signed Sales, that is <
                $1,059,000, none of the escrowed shares will be released. Rather
                these
                shares will be escrowed by the Escrow Agent instead of
                cancellation.

            
	 	 	 	 
	
              If
                K's Media achieved in between, a proportionate number of shares will
                be
                released using the following equation:  Actual Signed Sales /
                $1,900,000 X 2,625,000

            
	 	 	 	 
	
              Year
                2:

            	 	 	 
	
              If
                K's Media achieved >=90% of Year 2 Signed Sales, that is
                >=US$14,380,000,  release 2,625,000 to KTV Management
                Team

            
	 	 	 	 
	
              If
                K's Media didn't achieve > 50% in Year 1, but achieved >=90% in Year
                2, we will release Year 1's escrowed shares using the following
                equation:

            
	
              Actual
                Signed Sales in Year 1 / $1,900,000 X 2,625,000

            
	 	 	 	 
	
              If
                K's Media achieved <50% of Year 2 Signed Sales, that is <
                $7,990,000, none of the escrowed shares will be released.

            
	 	 	 	 
	
              If
                K's Media achieved in between, a proportionate number of shares will
                be
                released using the following equation:

            
	
              Actual
                Signed Sales/ $14,380,000 X 2,625,000

            
	 	 	 	 
	
              Year
                3:

            	 	 	 
	
              If
                K's Media achieved >=90% of Year 3 Signed Sales, that is
                >=US$33,230,000,  release 2,625,000 to KTV Management
                Team

            
	 	 	 	 
	
              If
                K's Media achieved <50% of Year 3 Signed Sales, that is <
                $18,460,000, none of the escrowed shares will be released.

            
	 	 	 	 
	
              If
                K's Media achieved in between, a proportionate number of shares will
                be
                released using the following equation:

            
	
              Actual
                Signed Sales / $33,230,000 X 2,625,000

            
	 	 	 	 
	
              All
                un-released shares will be cancelled then.

            
	 	 	 	 
	
              Release
                Formula (2):

            	 	 	 
	 	 	 	 
	
              Release
                date will be same as Release Formula (1)

            
	 	 	 	 
	
              Release
                standard as follows:

            	 	 	 
	 	 	 	 
	
              eg:
                Year 1, if Wang, QingYa signed up less than 300 KTV club for the
                "KTV
                Advertisement Placing Agreement" with K's Media ("AD Agreement"),
                we will
                cancel 60% of his entitled shares, which is 10,500,000 X 25%=2,625,000
                X
                60% = 1,575,000 shares.

            
	 	 	 	 
	
              DATE

            	
              Condition

            	
              Total
                # of Shares=2,625,000

            	 
	
              Year
                1

            	
              >600

            	
              release
                60%

            	 
	

            	
              300-600

            	
              Pro
                Rata

            	 
	

            	
              <300

            	
              Cancel
                60%

            	 
	

            	

            	

            	 
	
              Year
                2

            	
              >600

            	
              Release
                20%

            	 
	

            	
              300-600

            	
              Pro
                Rata

            	 
	 	
              <300

            	
              Cancel
                20%

            	 
	

            	

            	

            	 
	
              Year
                3

            	
              >600

            	
              Release
                20%

            	 
	

            	
              300-600

            	
              Pro
                Rata

            	 
	

            	
              <300

            	
              Cancel
                20%