Escrow Agreement by and among the Company, Univest Securities, LLC, White Lion Capital, LLC, and Wilmington Trust, National Association dated as of January 19, 2021
Exhibit 10.3
ESCROW AGREEMENT
This Escrow Agreement dated this 19th day of January, 2021 (the “Escrow Agreement”), is entered into by and among Univest Securities LLC, a New York limited liability company, having an office at 375 Park Avenue, Unit 1502, New York, NY 10152 (the “Placement Agent”), White Lion Capital, LLC, a Nevada limited liability company, having an office at 16911 San Fernando Mission Blvd Suite #183, Granada Hills, CA 91344 (“Investor”), TD Holdings, Inc., a Delaware Corporation, having an address at 25th Floor, Block C, Tairan Building, No. 31 Tairan 8th Road, Futian District, Shenzhen, Guangdong, PRC 518000 (the “Company”), and Wilmington Trust, National Association, having an office at Suite 2 R, 166 Mercer Street, New York, NY 10012, as escrow agent (“Escrow Agent”). All capitalized terms not herein defined shall have the meaning ascribed to them in that certain Common Stock Purchase Agreement, dated January 19, 2021, between the Company and Investor, including all attachments, schedules and exhibits thereto ( the “SPA”).
RECITALS
WHEREAS, pursuant to the issuance of one or more Purchase Notices under the SPA, the Company desires to sell its shares of common stock, par value $0.001 (the “Shares”) to Investor;
WHEREAS, the Company is required to establish an escrow account in connection with that certain Placement Agency Agreement, dated January 6, 2020, by and between the Company and the Placement Agent
WHEREAS, the Company desires to establish an escrow account with the Escrow Agent for funds contributed by Investor with the Escrow Agent, to be held for the benefit of Investor and the Company in accordance with the terms of this Escrow Agreement; and
WHEREAS, the Company, the Placement Agent and Investor hereby appoint Escrow Agent to act as Escrow Agent for the purposes of this Escrow Agreement and the Escrow Agent accepts such appointment in accordance with the terms of this Escrow Agreement.
NOW, THEREFORE, in consideration of the premises, and further consideration of the covenants set forth hereafter, it is hereby agreed mutually as follows:
DEFINITIONS
When used herein, each of the following terms shall have the respective meanings as set forth below:
“Applicable Law” shall have the meaning as set forth in Section 4.12.
“Authorized Representative” shall mean any individual designated by a Party as authorized to provide Written Direction hereunder pursuant to its respective Certificate of Authorized Signers.
“Certificate of Authorized Signers” shall mean that certain certificate, substantially in the form of Exhibit B hereto, delivered by each Party and setting forth its respective Authorized Representatives.
“CIP” shall have the meaning as set forth in Section 4.12.
“Company” shall mean TD Holdings, Inc.
1
“Escrow Account” shall mean that certain United States Dollar denominated account established as set forth below:
Manufacturers & Traders Trust Co.
ABA#
A/C#
A/C Name: TD Holdings Escrow
Attn: Global Capital Markets
“Escrow Agent” shall mean Wilmington Trust, National Association.
“Escrow Agreement” shall have the meaning as set forth in the Recitals hereto.
“Escrow Funds” shall mean all funds delivered to the Escrow Agent by Investor for deposit in the Escrow Account, together with all investments thereof and all interest accumulated thereon and proceeds therefrom.
“Indemnified Parties” shall have the meaning as set forth in Section 3.1.
“Party” and collectively, the “Parties” shall mean Investor, the Placement Agent, and/or the Company, respectively.
“SPA”, shall mean that certain Common Stock Purchase Agreement, dated January 19, 2021, between the Company and Investor.
“Written Direction” shall mean any instruction or notice delivered to the Escrow Agent hereunder.
ARTICLE I. ESCROW DEPOSIT
| 1.1 | Receipt of Escrow Funds. |
(a) Upon execution of this Escrow Agreement by each of the parties hereto, Investor shall deposit funds pursuant to Section 2.2 of the SPA (the “Deposited Funds”) from time to time via wire transfer to the Escrow Account.
(b) All such wire transfers remitted to the Escrow Agent shall be accompanied by information identifying Investor, including the name, mailing address, taxpayer identification number and a completed Form W9/W8 (the “Investor Information”). In the event Investor Information is not provided to Escrow Agent by Investor, then the Company agrees to promptly upon request provide Escrow Agent with such information in writing. The Escrow Agent shall not be required to accept any Escrow Funds which are not accompanied by the Investor Information. In the event that Investor fails to remit an executed Form W-9 to the Escrow Agent prior to the date the Escrow Agent returns such Investor’s funds, the Escrow Agent will be required to withhold a portion of the earnings attributable Investor at the applicable rate in accordance with Section 3406 of the Internal Revenue Code of 1986, as amended.The Escrow Agent will hold the Escrow Funds, in escrow upon the terms and conditions set forth in this Escrow Agreement and shall not disburse funds from the Escrow Account except as provided herein. The Company understands that until disbursed pursuant to Paragraph 1.3, it is not entitled to any Escrow Funds and no funds deposited in the Escrow Account will become the property of the Company. All funds so deposited shall remain the property of Investor according to its interests and shall not be subject to any lien or charge by Escrow Agent or by judgment or creditors' claims against Company until released or eligible to be released to Company in accordance with section 1.3 hereof.
2
(c) The Escrow Agent shall have no duty or responsibility to solicit the Escrow Funds from Investor or to enforce the collection or demand payment of any funds deposited into the Escrow Account. In the event that any funds, including cleared funds, deposited in the Escrow Account prove uncollectible after the funds represented thereby have been released by the Escrow Agent pursuant to this Agreement, Investor shall immediately reimburse the Escrow Agent upon request for the face amount of such check or checks, together with reasonable and customary charges and expenses related thereto, and the Escrow Agent shall deliver the returned checks or other instruments to Investor. Investor acknowledges that its obligation in the preceding sentence shall survive the termination of this Agreement and the resignation or removal of the Escrow Agent.
| 1.2 | Disbursements. |
(a) Disbursement instructions shall be limited to the payment to the Escrow Agent of escrow fee as set forth in Exhibit C hereof (the “Escrow Fee”) and wire transfer fees, the payment to the Company of the purchase price for the Shares delivered to Investor, the payment of the placement agent fee and reimbursement of the Placement Agent’s expenses to the Placement Agent, and the payment of the balance of Escrow Funds, if any, to Investor (these four payments, in the aggregate, one “Closing”). Escrow Agent shall make the disbursements according to the Written Direction signed by the Company, Investor and the Placement Agent, a form of which is set forth as Exhibit A hereof
Notwithstanding the foregoing, Escrow Agent shall not be obligated to disburse the Escrow Funds if the Escrow Agent has reason to believe that investments in full payment for that number of Shares have not been received, deposited with and collected by the Escrow Agent.
(b) In the event that Escrow Agent makes any payment to any other party pursuant to this Escrow Agreement and for any reason such payment (or any portion thereof) is required to be returned to the Escrow Account or another party or is subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to a receiver, trustee or other party under any bankruptcy or insolvency law, other federal or state law, common law or equitable doctrine, then the recipient shall repay to the Escrow Agent upon written request the amount so paid to it.
(c) The Escrow Agent shall, in its sole discretion, comply with judgments or orders issued or process entered by any court with respect to the Escrow Funds, including without limitation any attachment, levy or garnishment, without any obligation to determine such court's jurisdiction in the matter and in accordance with its normal business practices. If the Escrow Agent complies with any such judgment, order or process, then Escrow Agent shall not be liable to any Party or any other person by reason of such compliance, regardless of the final disposition of any such judgment, order or process.
(d) Each Party understands and agrees that the Escrow Agent shall have no obligation or duty to act upon a Written Direction delivered to the Escrow Agent for the disbursement of Escrow Funds under this Escrow Agreement if such Written Direction is not (i) in writing, (ii) signed by an Authorized Representative of each Party, and (iii) delivered to, and able to be authenticated by, the Escrow Agent in accordance with Section 1.5.
(e) Upon request, the Escrow Agent will furnish monthly statements to each Party setting forth the activity in the Escrow Account.
(f) A Party may specify in a Written Direction whether the Escrow Funds shall be disbursed by way of wire transfer or check. If the written notice for the disbursement of funds does not so specify the disbursement means, the Escrow Agent may disburse the Escrow Funds by any means chosen by the Escrow Agent.
3
| 1.3 | Written Direction and Other Instruction. |
(a) With respect to any Written Direction or any other notice, direction or other instruction required to be delivered by a Party to the Escrow Agent under this Escrow Agreement, the Escrow Agent is only authorized to follow and rely upon any and all such instructions given to it from time to time if the Escrow Agent believes, in good faith, that such instruction is genuine and to have been signed by an Authorized Representative of all Parties herein. The Escrow Agent shall have no duty or obligation to verify that the person who sent such instruction is, in fact, a person duly authorized to give instructions on behalf of a Party, other than to verify that the signature of the Authorized Representative on any such instruction appears to be the signature of such person. Each Party acknowledges and agrees that it is fully informed of the protections and risks associated with the various methods of transmitting instructions to the Escrow Agent, and that there may be more secure methods of transmitting instructions other than the method selected by such Party. The Escrow Agent shall have no responsibility or liability for any loss which may result from:
(i) any action taken or not taken by the Escrow Agent in good faith reliance on any such signatures or instructions;
(ii) as a result of a Party’s reliance upon or use of any particular method of delivering instructions to the Escrow Agent, including the risk of interception of such instruction and misuse by third parties; or
(iii) any officer or Authorized Representative of a Party named in a Certificate of Authorized Signers delivered hereunder prior to actual receipt by the Escrow Agent of a more current or updated Certificate of Authorized Signers and a reasonable time for the Escrow Agent to act upon such updated or more current Certificate of Authorized Signers.
(b) Investor, the Placement Agent or the Company may, at any time, update its respective Certificate of Authorized Signers by signing and submitting to the Escrow Agent an updated Certificate substantially in the form of Exhibit B. Any updated Certificate of Authorized Signers shall not be effective unless the Escrow Agent countersigns a copy thereof. The Escrow Agent shall be entitled to a reasonable time to act to implement any changes on an updated Certificate of Authorized Signers.
| 1.4 | Delivery and Authentication of Written Direction. |
(a) A Written Direction must be delivered to the Escrow Agent by one of the delivery methods set forth in Section 4.3.
(b) Each Party and the Escrow Agent hereby agree that the following security procedures will be used to verify the authenticity of a Written Direction delivered by any Party to the Escrow Agent under this Escrow Agreement:
(i) The Written Direction must include the names and signatures of the Authorized Representatives of all Parties. The Escrow Agent will check that the names and signatures of the Authorized Representatives identified on the Written Direction appears to be the same as the name and signatures of the Authorized Representatives of such Parties; and
(ii) If the Written Direction is sent by email to the Escrow Agent by one Party, the Escrow Agent also shall receive confirmation from email addresses for Authorized Representatives of the other two Parties as set forth on a Certificate of Authorized Signers in Exhibit B or from an email address for a person authorized under a Certificate of Authorized Signers to email a Written Direction to the Escrow Agent on behalf of the Authorized Representative).
4
(c) Each Party acknowledges and agrees that given its particular circumstances, including the nature of its business, the size, type and frequency of its instructions, transactions and files, internal procedures and systems, the alternative security procedures offered by the Escrow Agent and the security procedures in general use by other customers and banks similarly situated, the security procedures set forth in this Section 1.4 are a commercially reasonable method of verifying the authenticity of a payment order in a Written Direction.
(d) The Escrow Agent is authorized to execute, and each Party expressly agrees to be bound by any payment order in a Written Direction issued in its name (and associated funds transfer) (i) that is accepted by the Escrow Agent in accordance with the security procedures set forth in this Section 1.4, whether or not authorized by such Party and/or (ii) that is authorized by or on behalf of such Party or for which such Party is otherwise bound under the law of agency, whether or not the security procedures set forth in this Section 1.4 were followed, and to debit the Escrow Account for the amount of the payment order. Notwithstanding anything else, the Escrow Agent shall be deemed to have acted in good faith and without negligence, gross negligence or misconduct if the Escrow Agent is authorized to execute the payment order under this Section 1.4. Any action taken by the Escrow Agent pursuant to this Section 1.4 prior to the Escrow Agent’s actual receipt and acknowledgement of a notice of revocation, cancellation or amendment of a Written Direction shall not be affected by such notice of revocation, cancellation or amendment of a Written Direction.
(e) The security procedures set forth in this Section 1.4 are intended to verify the authenticity of payment orders provided to the Escrow Agent and are not designed to, and do not, detect errors in the transmission or content of any payment order. The Escrow Agent is not responsible for detecting an error in the payment order, regardless of whether either Party believes the error was apparent, and the Escrow Agent is not liable for any losses arising from any failure to detect an error.
(f) When instructed to credit or pay a party by both name and a unique numeric or alpha-numeric identifier (e.g. ABA number or account number), the Escrow Agent, and any other banks participating in the funds transfer, may rely solely on the unique identifier, even if it identifies a party different than the party named. Each Party agrees to be bound by the rules of any funds transfer network used in connection with any payment order accepted by the Escrow Agent hereunder.
(g) The Escrow Agent shall not be obliged to make any payment requested under this Escrow Agreement if it is unable to validate the authenticity of the request by the security procedures set forth in this Section 1.5. The Escrow Agent’s inability to confirm a payment order may result in a delay or failure to act on that payment order. Notwithstanding anything else in this Escrow Agreement, the Escrow Agent shall not be required to treat a payment order as having been received until the Escrow Agent has authenticated it pursuant to the security procedures in this Section 1.4 and shall not be liable or responsible for any losses arising in relation to such delay or failure to act.
| 1.5 | Termination. |
This Escrow Agreement shall terminate upon the resignation or removal of the Escrow Agent as set forth in Section 3.4 (Resignation or Removal), at which time the Escrow Agent is authorized and directed to disburse the Escrow Funds in accordance with Section 1.2 (Disbursements) and this Escrow Agreement shall be of no further force and effect, except that the provision of 3.2 (Limitation of Liability) hereof shall survive termination.
5
ARTICLE II. DUTIES OF THE ESCROW AGENT
| 2.1 | Scope of Responsibility. |
Notwithstanding any provision to the contrary, the Escrow Agent is obligated only to perform the duties expressly and specifically set forth in this Escrow Agreement, which shall be deemed purely ministerial in nature. Under no circumstances will the Escrow Agent be deemed to be a fiduciary to any Party or any other person under this Escrow Agreement or otherwise. The Escrow Agent will not be responsible or liable for the failure of either Party to perform in accordance with this Escrow Agreement. The Escrow Agent shall neither be responsible for, nor chargeable with, knowledge of the terms and conditions of any other agreement, instrument, or document other than this Escrow Agreement, whether or not an original or a copy of such agreement has been provided to the Escrow Agent; and the Escrow Agent shall have no duty to know or inquire as to the performance or nonperformance of any provision of any such agreement, instrument, or document. References in this Escrow Agreement to any other agreement, instrument, or document are for the convenience of the parties and the Escrow Agent has no duties or obligations with respect thereto. The Escrow Agent acts hereunder as escrow agent only, and is not responsible or liable in any manner whatsoever for the sufficiency, correctness, applicability or validity of the subject matter of this Escrow Agreement or any part thereof. The Escrow Agent shall have no responsibilities (except as expressly set forth herein) as to the validity, sufficiency, value, genuineness, ownership or transferability of the Escrow Funds, written instructions, or any other documents in connection therewith, and will not be regarded as making nor be required to make, any representations thereto. This Escrow Agreement sets forth all matters pertinent to the escrow contemplated hereunder, and no additional obligations of the Escrow Agent shall be inferred or implied from the terms of this Escrow Agreement, any other agreement or otherwise.
| 2.2 | Rights of the Escrow Agent. |
No provision of this Escrow Agreement shall require the Escrow Agent to expend or risk its own funds or otherwise incur any financial liability or potential financial liability in the performance of its duties or the exercise of its rights under this Escrow Agreement. The Escrow Agent shall not be required to take any action which, in the Escrow Agent's sole and absolute judgment, could involve it in expense or liability unless furnished with security and indemnity which it deems, in its sole and absolute discretion, to be satisfactory. The Escrow Agent shall not be obligated to take any legal action or to commence any proceedings in connection with this Escrow Agreement or any property held hereunder or to appear in, prosecute or defend in any such legal action or proceedings. The Escrow Agent shall be protected in acting upon any written instruction, notice, request, waiver, consent, certificate, receipt, authorization, power of attorney or other paper or document which the Escrow Agent in good faith believes to be genuine and what it purports, to be, including, but not limited to, items directing investment or non-investment of funds, items requesting or authorizing release, disbursement or retainage of the subject matter of this Escrow Agreement and items amending the terms of this Escrow Agreement.
| 2.3 | Attorneys and Agents. |
The Escrow Agent shall be entitled to consult with legal counsel in the event that a question or dispute arises with regard to the construction of any of the provisions hereof. The Escrow Agent shall be entitled to rely on and shall not be liable for any action taken or omitted to be taken by the Escrow Agent in accordance with the advice of counsel or other professionals retained or consulted by the Escrow Agent. The Escrow Agent shall be reimbursed as set forth in Article III for any and all compensation (fees, expenses and other costs) paid and/or reimbursed to such counsel and/or professionals. The Escrow Agent may perform any and all of its duties through its agents, representatives, attorneys, custodians, and/or nominees and shall not be responsible for the acts or omissions of such agents, representatives, attorneys, custodians or nominees appointed with due care.
| 2.4 | Right Not Duty Undertaken. |
The permissive rights of the Escrow Agent to do things enumerated in this Escrow Agreement shall not be construed as duties.
6
ARTICLE III. PROVISIONS CONCERNING THE ESCROW AGENT
| 3.1 | Indemnification. |
The Parties, jointly and severally, hereby indemnify and defend the Escrow Agent and its directors, officers, employees and agents (collectively, the “Indemnified Parties”), and hold the Indemnified Parties harmless from any and against all liabilities, losses, actions, suits or proceedings at law or in equity, and any other expenses, fees or charges of any character or nature, (including, without limitation, attorney's fees and expenses and the costs of enforcement of this Escrow Agreement or any provision thereof), which an Indemnified Party may incur or with which it may be threatened by reason of acting as or on behalf of the Escrow Agent under this Escrow Agreement or arising out of the existence of the Escrow Account, except to the extent the same shall be have been finally adjudicated to have been directly caused by the Escrow Agent's gross negligence or willful misconduct. The Escrow Agent shall have a first lien against the Escrow Account (to the extent of Company's rights thereto) to secure the obligations of the Parties hereunder. The terms of this paragraph shall survive termination of this Escrow Agreement.
| 3.2 | Limitation of Liability. |
THE ESCROW AGENT SHALL NOT BE LIABLE, DIRECTLY OR INDIRECTLY, FOR ANY (I) DAMAGES, LOSSES OR EXPENSES ARISING OUT OF OR IN CONNECTION WITH THIS ESCROW AGREEMENT, THE ESCROW ACCOUNT, THE ESCROW FUNDS, OR 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, (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, OR (III) ANY AMOUNT IN EXCESS OF THE VALUE OF THE ESCROW FUNDS.
| 3.3 | No Endorsement. |
THE COMPANY, INVESTOR AND THE PLACEMENT AGENT UNDERSTAND THAT THE ESCROW AGENT, BY ACCEPTING THE APPOINTMENT AND DESIGNATION AS ESCROW AGENT HEREUNDER, IN NO WAY ENDORSES THE MERITS OF THE OFFERING OF THE SECURITIES. THE COMPANY, INVESTOR AND THE PLACEMENT AGENT AGREE TO NOTIFY ANY PERSON ACTING ON ITS BEHALF THAT THE ESCROW AGENT’S POSITION AS ESCROW AGENT DOES NOT CONSTITUTE SUCH AN ENDORSEMENT, AND TO PROHIBIT SAID PERSONS FROM THE USE OF THE ESCROW AGENT’S NAME AS AN ENDORSER OF SUCH OFFERING. THE COMPANY, INVESTOR AND THE PLACEMENT AGENT FURTHER AGREE TO INCLUDE WITH ANY SALES LITERATURE, IN WHICH THE ESCROW AGENT’S NAME APPEARS AND WHICH IS USED IN CONNECTION WITH SUCH OFFERING, A STATEMENT TO THE EFFECT THAT THE ESCROW AGENT IN NO WAY ENDORSES THE MERITS OF THE OFFERING.
7
| 3.4 | Resignation or Removal. |
The Escrow Agent may, at any time, resign as escrow agent hereunder by furnishing written notice of its resignation to each Party. At such time, all fees and expenses to which the Escrow Agent is entitled shall be immediately due and payable to Escrow Agent. The Parties may remove the Escrow Agent by furnishing to the Escrow Agent a joint written notice of its removal along with payment of all fees and expenses to which it is entitled through the date of termination. Such resignation or removal, as the case may be, shall be effective thirty (30) days after the delivery of such notice or upon the earlier appointment of a successor, and the Escrow Agent’s sole responsibility thereafter shall be to safely keep the Escrow Funds and to deliver the same to a successor escrow agent as shall be appointed by the Parties, as evidenced by a joint written notice filed with the Escrow Agent or in accordance with a court order. If the Parties have failed to appoint a successor escrow agent prior to the expiration of thirty (30) days following the delivery of such notice of resignation or removal, the Escrow Agent shall be entitled, at its sole discretion and at the expense of Investor, to petition any court of competent jurisdiction for the appointment of a successor escrow agent or for other appropriate relief, and any such resulting appointment shall be binding upon the Parties.
| 3.5 | Compensation. |
(a) The Escrow Agent shall be entitled to compensation for its services as stated in the fee schedule attached hereto as Exhibit C, which compensation shall be paid by the Company, deducted from payments for shares received from the Company. Such compensation is intended for the Escrow Agent's services as contemplated by this Escrow Agreement. In addition to such compensation, in the event that the conditions for the disbursement of funds under this Escrow Agreement are not fulfilled, or the Escrow Agent renders any service not contemplated in this Escrow Agreement, or there is any assignment of interest in the subject matter of this Escrow 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 Escrow Agreement or the subject matter hereof, then the Escrow Agent shall be compensated for such extraordinary services and any services or work performed by Escrow Agent in connection with any delay, controversy, litigation or event, and reimbursed for all costs and expenses, including reasonable attorneys’ fees and expenses, occasioned by any such delay, controversy, litigation or event. If any amount due to the Escrow Agent hereunder is not paid within thirty (30) days of the date due, the Escrow Agent in its sole discretion may charge interest on such amount up to the highest rate permitted by applicable law.
(b) As security for the due and punctual performance of any and all of the Parties’ obligations to the Escrow Agent hereunder, now or hereafter arising, the Parties, individually and collectively, hereby pledge, assign and grant (to the extent of Company's rights thereto) to the Escrow Agent a continuing security interest in, and a lien on and right of setoff against, the Escrow Funds and all distributions thereon, investments thereof or additions thereto (whether such additions are the result of deposits by the Parties or the investment of Escrow Funds or otherwise). If any fees, expenses or costs incurred by, or any obligations owed to, the Escrow Agent hereunder are not promptly paid when due, the Escrow Agent may reimburse itself therefor from the Escrow Funds, and may sell, convey or otherwise dispose of any Escrow Funds for such purpose. The security interest and setoff rights of the Escrow Agent shall at all times be valid, perfected and enforceable by the Escrow Agent against the Parties and all third parties in accordance with the terms of this Escrow Agreement.
The terms of this Section 3.5 shall survive termination of this Escrow Agreement.
8
| 3.6 | Disagreements. |
If any conflict, disagreement or dispute arises between, among, or involving any of the parties hereto concerning the meaning or validity of any provision hereunder or concerning any other matter relating to this Escrow Agreement, or the Escrow Agent is in doubt as to the action to be taken hereunder, the Escrow Agent may, at its option, refuse to act until the Escrow Agent (a) receives a final non-appealable order of a court of competent jurisdiction directing delivery of the Escrow Funds or (b) receives a written instruction, executed by each of the parties involved in such disagreement or dispute, in a form reasonably acceptable to the Escrow Agent, directing delivery of the Escrow Funds. The Escrow Agent will be entitled to act on any such written instruction or final, non-appealable order of a court of competent jurisdiction without further question, inquiry or consent. The Escrow Agent may file an interpleader action in a state or federal court, and upon the filing thereof, the Escrow Agent will be relieved of all liability as to the Escrow Funds and will be entitled to recover reasonable and documented out-of-pocket attorneys’ fees, expenses and other costs incurred in commencing and maintaining any such interpleader action. In the event the Escrow Agent receives conflicting instructions hereunder, the Escrow Agent shall be fully protected in refraining from acting until such conflict is resolved to the satisfaction of the Escrow Agent.
| 3.7 | 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 Escrow 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.
| 3.8 | Attachment of Escrow Funds; Compliance with Legal Orders. |
In the event that any Escrow Funds shall be attached, garnished or levied upon by any court order, or the delivery thereof shall be stayed or enjoined by an order of a court, or any order, judgment or decree shall be made or entered by any court order affecting the Escrow Funds, the Escrow Agent is hereby expressly authorized, in its sole discretion, to respond as it deems appropriate or to comply with all writs, orders or decrees so entered or issued, or which it is advised by legal counsel of its own choosing is binding upon it, whether with or without jurisdiction. In the event that the Escrow Agent obeys or complies with any such writ, order or decree it shall not be liable to any Party or to any other person, firm or corporation, should, by reason of such compliance notwithstanding, such writ, order or decree be subsequently reversed, modified, annulled, set aside or vacated.
| 3.9 | Force Majeure. |
The Escrow Agent shall not be responsible or liable for any failure or delay in the performance of its obligation under this Escrow Agreement arising out of or caused, directly or indirectly, by circumstances beyond its reasonable control, including, without limitation, acts of God; earthquakes; fire; flood; wars; acts of terrorism; civil or military disturbances; sabotage; epidemic; riots; interruptions; loss or malfunctions of utilities including but not limited to, computer (hardware or software), payment systems, or communications services; accidents; labor disputes; acts of civil or military authority or governmental action; it being understood that the Escrow Agent shall use commercially reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as reasonably practicable under the circumstances.
9
ARTICLE IV. MISCELLANEOUS
| 4.1 | Successors and Assigns. |
This Escrow Agreement shall be binding on and inure to the benefit of each Party and the Escrow Agent and their respective successors and permitted assigns. No other persons shall have any rights under this Escrow Agreement. No assignment of the interest of any of the Parties and the Escrow Agent shall be binding unless and until written notice of such assignment shall be delivered to the other Party and the Escrow Agent and shall require the prior written consent of the other Party and the Escrow Agent (such consent not to be unreasonably withheld).
| 4.2 | Escheat. |
Each Party is aware that under applicable state law, property which is presumed abandoned may under certain circumstances escheat to the applicable state. The Escrow Agent shall have no liability to either Party or any other party, should any or all of the Escrow Funds escheat by operation of law.
| 4.3 | Notices. |
All notices, requests, demands, and other communications required under this Escrow Agreement shall be in writing, in English, and shall be deemed to have been duly given if delivered (i) personally, (ii) by facsimile transmission with written confirmation of receipt, (iii) by overnight delivery with a reputable national overnight delivery service, (iv) by mail or by certified mail, return receipt requested, and postage prepaid, or (v) by electronic transmission; including by way of e-mail (as long as such email is accompanied by a PDF or similar version of the relevant document bearing the signature of an Authorized Representative for the Party sending the notice) with email confirmation of receipt. If any notice is mailed, it shall be deemed given five business days after the date such notice is deposited in the United States mail. If notice is given to a party, it shall be given at the address for such party set forth below. It shall be the responsibility of each Party to notify the Escrow Agent in writing of any name or address changes. In the case of communications delivered to the Escrow Agent, such communications shall be deemed to have been given on the date received by the Escrow Agent.
If to the Company:
TD Holdings, Inc.
25th Floor, Block C, Tairan Building
No. 31 Tairan 8th Road, Futian District
Shenzhen, Guangdong, PRC 518000Attention: Wei Sun
Email: ***@***
If to the Placement Agent:
Univest Securities, LLC
375 Park Avenue, Unit 1502
New York, NY 10152
Attention: Edric Guo
Email: ***@***
If to Investor:
White Lion Capital, LLC
Sam Yaffa
16911 San Fernando Mission Blvd Suite #183
Granada Hills, CA 91344
Email: ***@***
10
If to the Escrow Agent:
Wilmington Trust, National Association
Corporate Client Services
166 Mercer Street, Suite 2R
New York, NY 10012
Attn: Boris Treyger
Telephone: (212) 941-4416
Email address: ***@***
| 4.4 | Governing Law. |
This Escrow Agreement shall be governed by and construed in accordance with the laws of the State of New York without regard to any laws relating to choice of laws (whether of the State of New York or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of New York.
| 4.5 | Venue. |
Each Party and the Escrow Agent hereby consent to the exclusive personal jurisdiction of any state or federal court sitting in The City of New York, Borough of Manhattan in the event of a dispute arising out of or under this Escrow Agreement. Each Party and the Escrow Agent hereby irrevocably waives any objection to the laying of the venue of any suit, action or proceeding and irrevocably submits to the exclusive jurisdiction of such court in such suit, action or proceeding.
| 4.6 | Entire Agreement. |
This Escrow Agreement and the exhibits hereto set forth the entire agreement and understanding of the parties related to the Escrow Funds and supersedes all prior agreements and understandings, oral or written. If a court of competent jurisdiction declares a provision invalid, it will be ineffective only to the extent of the invalidity, so that the remainder of the provision and Escrow Agreement will continue in full force and effect. In no event shall the Escrow Agent be bound by the terms of the Subscription Agreement or the Underwriting Agreement. In the event of any direct conflict of the terms of this Escrow Agreement with the terms of the Subscription Agreement or the Underwriting Agreement, the terms of This Escrow Agreement shall control and prevail. This Escrow Agreement is not intended to confer upon any person other than the parties hereto any rights or remedies.
| 4.7 | Amendment. |
This Escrow Agreement may be amended, modified, supplemented, superseded, rescinded, or canceled only by a written instrument executed by the Parties and the Escrow Agent; provided that any Certificate of Authorized Signers may be amended at any time in accordance with Section 1.3.
11
| 4.8 | Waivers. |
The failure of any party to this Escrow Agreement at any time or times to require performance of any provision under this Escrow Agreement shall in no manner affect the right at a later time to enforce the same performance. A waiver by any party to this Escrow Agreement of any such condition or breach of any term, covenant, representation, or warranty contained in this Escrow Agreement, in any one or more instances, shall neither be construed as a further or continuing waiver of any such condition or breach nor a waiver of any other condition or breach of any other term, covenant, representation, or warranty contained in this Escrow Agreement.
| 4.9 | Interpretation. |
Section headings of this Escrow Agreement have been inserted for convenience of reference only and shall in no way restrict or otherwise modify any of the terms or provisions of this Escrow Agreement. Unless otherwise indicated by the context, the singular shall include the plural and the plural shall include the singular. Any references to an Exhibit is a reference to an Exhibit of this Escrow Agreement.
| 4.10 | Counterparts. |
This Escrow Agreement may be executed in one or more counterparts, each of which when executed shall be deemed to be an original, and such counterparts shall together constitute one and the same instrument.
| 4.11 | Waiver of Jury Trial. |
EACH OF THE PARTIES HERETO EXPRESSLY WAIVES THE RIGHT TO TRIAL BY JURY IN RESOLVING ANY CLAIM OR COUNTERCLAIM RELATING TO OR ARISING OUT OF THIS ESCROW AGREEMENT.
| 4.12 | Patriot Act Compliance. |
In order to comply with laws, rules, regulations and executive orders in effect from time to time applicable to banking institutions, including those relating to the funding of terrorist activities and money laundering and the Customer Identification Program (“CIP”) requirements under the USA PATRIOT Act and its implementing regulations, pursuant to which the Escrow Agent must obtain, verify and record information that allows the Escrow Agent to identify customers (“Applicable Law”), the Escrow Agent is required to obtain, verify and record certain information relating to individuals and entities which maintain a business relationship with the Escrow Agent. Accordingly, each Party agrees to provide to the Escrow Agent upon its request from time to time such identifying information and documentation as may be available for such party in order to enable the Escrow Agent to comply with Applicable Law, including, but not limited to, information as to name, physical address, tax identification number and other information that will help the Escrow Agent to identify and verify such Party such as organizational documents, certificates of good standing, licenses to do business or other pertinent identifying information. Each Party understands and agrees that the Escrow Agent cannot open the Escrow Account unless and until the Escrow Agent verifies the identities of the Parties in accordance with its CIP.
[The remainder of this page left intentionally blank.]
12
IN WITNESS WHEREOF, this Escrow Agreement has been duly executed as of the date first written above.
| TD HOLDINGS, INC. |
| By: | /s/ Renmei Ouyang | |
| Name: | Renmei Ouyang | |
| Title: | Chief Executive Officer |
| UNIVEST SECURITIES, LLC |
| By: | /s/ Edric Yi Guo | |
| Name: | Edric Yi Guo | |
| Title: | COO and Head of Investment Banking |
| WHITE LION CAPITAL, LLC |
| By: | /s/ Sam Yaffa | |
| Name: | Sam Yaffa | |
| Title: | Managing Member |
| WILMINGTON TRUST, NATIONAL ASSOCIATION, as Escrow Agent |
| By: | /s/ Boris Treyger | |
| Name: | Boris Treyger | |
| Title: | Vice President |
13
