Exhibit 10.3

 

STOCK ESCROW AGREEMENT

 

STOCK ESCROW AGREEMENT, dated as of October 23, 2018 (“Agreement”), by and among
ALBERTON ACQUISITION CORPORATION, a British Virgin Islands Company (the
“Company”), the initial shareholders listed on Exhibit A attached hereto (each,
an “Initial Shareholder” and collectively the “Initial Shareholders”) and
CONTINENTAL STOCK TRANSFER & TRUST COMPANY, a New York limited liability trust
company (the “Escrow Agent”).

 

WHEREAS, the Company has entered into an Underwriting Agreement, dated as of
October 23, 2018 (“Underwriting Agreement”), with Chardan Capital Markets LLC
(“Chardan”), acting as the representative of the underwriters (collectively, the
“Underwriters”), pursuant to which, among other matters, the Underwriters have
agreed to purchase 10,000,000 units (“Units”) of the Company, plus an additional
1,500,000 Units if the Underwriters exercise their over-allotment option in
full. Each Unit consists of one ordinary share of the Company, no par value (an
“Ordinary Share”), one redeemable warrant, each redeemable warrant entitling its
holder to purchase one-half (1/2) of one Ordinary Share at an exercise price of
$11.50 per full Ordinary Share, and one right to receive one-tenth (1/10) of an
Ordinary Share, all as more fully described in the Company’s final Prospectus,
dated October 23, 2018 (“Prospectus”), comprising part of the Company’s
Registration Statement on Form S-1 (File No. 333-227652 ) under the Securities
Act of 1933, as amended (“Registration Statement”), declared effective on
October 23, 2018 (“Effective Date”).

 

WHEREAS, the Initial Shareholders have agreed as a condition of the sale of the
Units to deposit their Insider Shares (as defined in the Prospectus), as set
forth opposite their respective names in Exhibit A attached hereto (collectively
“Escrow Shares”), in escrow as hereinafter provided.

 

WHEREAS, the Company and the Initial Shareholders desire that the Escrow Agent
accept the Escrow Shares, in escrow, to be held and disbursed as hereinafter
provided.

 

IT IS AGREED:

 

1. Appointment of Escrow Agent. The Company and the Initial Shareholders hereby
appoint the Escrow Agent to act in accordance with and subject to the terms of
this Agreement and the Escrow Agent hereby accepts such appointment and agrees
to act in accordance with and subject to such terms.

 

2. Deposit of Escrow Shares. On or prior to the Effective Date, each of the
Initial Shareholders delivered to the Escrow Agent certificates representing
such Initial Shareholder’s respective Escrow Shares, together with applicable
share powers, to be held and disbursed subject to the terms and conditions of
this Agreement. Each of the Initial Shareholders acknowledges that the
certificate representing such Initial Shareholder’s Escrow Shares is legended to
reflect the deposit of such Escrow Shares under this Agreement.

 

 

 

 

3. Disbursement of the Escrow Shares.

 

3.1 The Escrow Agent shall hold the Escrow Shares during the period (the “Escrow
Period”) commencing on the date hereof and (i) for 50% of the Escrow Shares,
ending on the earlier of (x) six months after the date of the consummation of
the Company’s initial business combination (as described in the Registration
Statement, hereinafter the “Business Combination”) and (y) the date on which the
closing price of the Ordinary Shares equals or exceeds $12.50 per share (as
adjusted for stock splits, stock dividends, reorganizations and
recapitalizations) for any 20 trading days within any 30-trading day period
commencing after the Business Combination and (ii) for the remaining 50% of the
Escrow Shares, ending six months after the date of the consummation of the
Business Combination. The Company shall promptly provide written notice of the
consummation of the Business Combination to the Escrow Agent. Upon completion of
the Escrow Period, the Escrow Agent shall disburse such amount of each Initial
Shareholder’s Escrow Shares (and any applicable share power) to such Initial
Shareholder; provided, however, that if the Escrow Agent is notified by the
Company pursuant to Section 6.7 hereof that the Company is being liquidated at
any time during the Escrow Period, then the Escrow Agent shall promptly destroy
the certificates representing the Escrow Shares; provided further, however, that
if, subsequent to the Business Combination, the Company (or the surviving
entity) subsequently consummates a liquidation, merger, stock exchange or other
similar transaction which results in all of the shareholders of such entity
having the right to exchange their Ordinary Shares for cash, securities or other
property, then the Escrow Agent will, upon receipt of a written notice executed
by the Chairman of the Board, Chief Executive Officer or other authorized
officer of the Company, in form reasonably acceptable to the Escrow Agent,
certifying that such transaction is then being consummated or such conditions
have been achieved, as applicable, release the Escrow Shares to the Initial
Shareholders. The Escrow Agent shall have no further duties hereunder after the
disbursement or destruction of the Escrow Shares in accordance with this Section
3.

 

3.2 Notwithstanding Section 3.1, if the Underwriters do not exercise their
over-allotment option to purchase an additional 1,500,000 Units of the Company
in full within 45 days of the date of the Prospectus (as described in the
Underwriting Agreement), the Initial Shareholder, whose Escrow Shares are
subject to forfeiture as set forth in Exhibit A attached hereto (the “Forfeiture
Escrow Shares”), agree that the Escrow Agent shall return to the Company for
cancellation, at no cost, the number of Escrow Shares held by each such holder
determined by multiplying the product of (a) Forfeiture Escrow Shares multiplied
by (b) a fraction, (i) the numerator of which is 1,500,000 minus the number of
Ordinary Shares purchased by the Underwriters upon the exercise of their
over-allotment option, and (ii) the denominator of which is 1,500,000. The
Company shall promptly provide written notice to the Escrow Agent of the
expiration or termination of the Underwriters’ over-allotment option and the
number of Units, if any, purchased by the Underwriters in connection with their
exercise thereof.

 

4. Rights of Initial Shareholders in Escrow Shares.

 

4.1 Voting Rights as a Shareholder. Subject to the terms of the Insider Letters
described in Section 4.4 hereof and except as herein provided, the Initial
Shareholders shall retain all of their rights as shareholders of the Company
during the Escrow Period, including, without limitation, the right to vote such
shares.

 

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4.2 Dividends and Other Distributions in Respect of the Escrow Shares. During
the Escrow Period, all dividends payable in cash with respect to the Escrow
Shares shall be paid to the Initial Shareholders, but all dividends payable in
shares or other non-cash property (“Non-Cash Dividends”) shall be delivered to
the Escrow Agent to hold in accordance with the terms hereof. As used herein,
the term “Escrow Shares” shall be deemed to include the Non-Cash Dividends
distributed thereon, if any.

 

4.3 Restrictions on Transfer. During the Escrow Period, the only permitted
transfers of the Escrow Shares will be for transfers (i) to the Company’s
officers, directors or their respective affiliates (including, for transfers to
an entity’s member upon its liquidation, and with respect to Howard Jiang, for
transfers to White and Williams LLP), (ii) to relatives and trusts for estate
planning purposes, (iii) by virtue of the laws of descent and distribution upon
death of the Initial Shareholder, (iv) pursuant to a qualified domestic
relations order, (v) by certain pledges to secure obligations incurred in
connection with purchases of the Company’s securities, (vi) by private sales
made at or prior to the consummation of the Business Combination at prices no
greater than the price at which the shares were originally purchased, or (vii)
to the Company for cancellation in accordance with Section 3.2 above or in
connection with the consummation of the Business Combination, in each case,
except for clause (vii), on the condition that such transfers may be implemented
only upon the respective transferee’s written agreement to be bound by the terms
and conditions of this Agreement and of the Insider Letter (as defined below)
signed by the Initial Shareholder transferring the Escrow Shares.

 

4.4 Insider Letters. Each of the Initial Shareholders has executed a letter
agreement with Chardan and the Company, dated as indicated on Exhibit A hereto,
and the form of which is filed as an exhibit to the Registration Statement
(“Insider Letter”), respecting the rights and obligations of such Initial
Shareholder in certain events, including but not limited to the liquidation of
the Company.

 

5. Concerning the Escrow Agent.

 

5.1 Good Faith Reliance. The Escrow Agent shall not be liable for any action
taken or omitted by it in good faith and in the exercise of its own best
judgment, and may rely conclusively and shall be protected in acting upon any
order, notice, demand, certificate, 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 believed by the Escrow Agent to be
genuine and to be signed or presented by the proper person or persons. The
Escrow Agent shall not be bound by any notice or demand, or any waiver,
modification, termination or rescission of this Agreement unless evidenced by a
writing delivered to the Escrow Agent signed by the proper party or parties and,
if the duties or rights of the Escrow Agent are affected, unless it shall have
given its prior written consent thereto.

 

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5.2 Indemnification. The Escrow Agent shall be indemnified and held harmless by
the Company from and against any expenses, including reasonable counsel fees and
disbursements, or loss suffered by the Escrow Agent in connection with any
action, suit or other proceeding involving any claim which in any way, directly
or indirectly, arises out of or relates to this Agreement, the services of the
Escrow Agent hereunder, or the Escrow Shares held by it hereunder, other than
expenses or losses arising from the gross negligence or willful misconduct of
the Escrow Agent. 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 notify the other parties hereto in writing. In the event of
the receipt of such notice, the Escrow Agent, in its sole discretion, may
commence an action in the nature of interpleader in an appropriate court to
determine ownership or disposition of the Escrow Shares or it may deposit the
Escrow Shares with the clerk of any appropriate court or it may retain the
Escrow 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 Escrow Shares are to be disbursed and delivered. The
provisions of this Section 5.2 shall survive in the event the Escrow Agent
resigns or is discharged pursuant to Sections 5.5 or 5.6 below.

 

5.3 Compensation. The Escrow Agent shall be entitled to reasonable compensation
from the Company for all services rendered by it hereunder. The Escrow Agent
shall also be entitled to reimbursement from the Company for all expenses paid
or incurred by it in the administration of its duties hereunder including, but
not limited to, all counsel, advisors’ and agents’ fees and disbursements and
all taxes or other governmental charges.

 

5.4 Further Assurances. From time to time on and after the date hereof, the
Company and the Initial Shareholders shall deliver or cause to be delivered to
the Escrow Agent such further documents and instruments and shall do or cause to
be done such further acts as the Escrow Agent shall reasonably request to carry
out more effectively the provisions and purposes of this Agreement, to evidence
compliance herewith or to assure itself that it is protected in acting
hereunder.

 

5.5 Resignation. 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
written notice and such resignation shall become effective as hereinafter
provided. Such resignation shall become effective at such time that the Escrow
Agent shall turn over to a successor escrow agent appointed by the Company, the
Escrow Shares held hereunder. If no new escrow agent is so appointed within the
60 day period following the giving of such notice of resignation, the Escrow
Agent may deposit the Escrow Shares with any court it reasonably deems
appropriate.

 

5.6 Discharge of Escrow Agent. The Escrow Agent shall resign and be discharged
from its duties as escrow agent hereunder if so requested in writing at any time
by the other parties hereto, jointly, provided, however, that such resignation
shall become effective only upon acceptance of appointment by a successor escrow
agent as provided in Section 5.5.

 

5.7 Liability. Notwithstanding anything herein to the contrary, the Escrow Agent
shall not be relieved from liability hereunder for its own gross negligence or
its own willful misconduct.

 

5.8 Waiver. The Escrow Agent hereby waives any right of set-off or any other
right, title, interest or claim of any kind (“Claim”) in, or to any distribution
of, the Trust Account (as defined in that certain Investment Management Trust
Agreement, dated as of the date hereof, by and between the Company and the
Escrow Agent as trustee thereunder) and hereby agrees not to seek recourse,
reimbursement, payment or satisfaction for any Claim against the Trust Account
for any reason whatsoever.

 

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6. Miscellaneous.

 

6.1 Governing Law. This Agreement shall for all purposes be deemed to be made
under and shall be construed in accordance with the laws of the State of New
York, without giving effect to conflicts of law principles that would result in
the application of the substantive laws of another jurisdiction.

 

6.2 Third Party Beneficiaries. Each of the Initial Shareholders hereby
acknowledges that Chardan is a third party beneficiaries of this Agreement and
this Agreement may not be modified or changed without the prior written consent
of Chardan.

 

6.3 Entire Agreement. This Agreement contains the entire agreement of the
parties hereto with respect to the subject matter hereof and, except as
expressly provided herein, may not be changed or modified except by an
instrument in writing signed by the party to the charged.

 

6.4 Headings. The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation
thereof.

 

6.5 Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the respective parties hereto and their legal representatives,
successors and assigns.

 

6.6 Notices. Any notice or other communication required or which may be given
hereunder shall be in writing and either be delivered personally or be mailed,
certified or registered mail (return receipt requested), or by private national
courier service, and shall be deemed given when so delivered personally or, if
mailed, two days after the date of mailing, or if by courier service, on the
date on which it is delivered to the addressee (with the evidence of such
delivery), as follows:

 

(a) If to the Company, to:

 

Alberton Acquisition Corporation

Room 1001, 10/F, Capital Center

151 Gloucester Road, Wanchai, Hong Kong

Attn: Bin (Ben) Wang, Chief Executive Officer

 

A copy (which copy shall not constitute notice) sent hereunder shall be sent to:

 

White and Williams LLP

7 Times Square, Suite 2900

New York, NY 10036

Attn: Alexandria Kane, Esq.

 

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(b) If to a Shareholder, to his address set forth in Exhibit A.

 

(c) If to the Escrow Agent, to:

 

Continental Stock Transfer & Trust Company

1 State Street, 30th Floor

New York, NY 10004

Attn: Relationship Management

 

A copy (which copy shall not constitute notice) sent hereunder shall be sent to:

 

Chardan Capital Markets LLC

17 State Street, Suite 1600

New York, NY 10004

Attn: George Kaufman

 

and:

 

Loeb & Loeb LLP

345 Park Avenue

New York, New York 10154

Attn: Giovanni Caruso, Esq.

 

and:

 

White and Williams LLP

7 Times Square, Suite 2900

New York, NY 10036

Attn: Alexandria Kane, Esq.

 

The parties may change the persons and addresses to which the notices or other
communications are to be sent by giving written notice to any such change in the
manner provided herein for giving notice.

 

6.7 Liquidation of the Company. The Company shall give the Escrow Agent written
notification of the liquidation and dissolution of the Company in the event that
the Company fails to consummate the Business Combination within the time period
specified in the Prospectus.

 

[Signature Page Follows]

 

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WITNESS the execution of this Agreement as of the date first above written.

 

  COMPANY:       ALBERTON ACQUISITION CORPORATION         By: /s/ Bin (Ben) Wang
    Name: Bin (Ben) Wang     Title:   Chief Executive Officer         INITIAL
SHAREHOLDERS:       Hong Ye Hong Kong Shareholding Co., Limited.         By: /s/
Guan Wang     Name: Guan Wang     Title:   Sole Director and Sole Shareholder  
        /s/ Bin (Ben) Wang     Bin (Ben) Wang           /s/ Keqing (Kevin) Liu  
  Keqing (Kevin) Liu           /s/ Howard Jiang     Howard Jiang           /s/
John W. Allen     John W. Allen           /s/ Harry Edelson     Harry Edelson  
      CONTINENTAL STOCK TRANSFER & TRUST COMPANY, as Escrow Agent         By:
/s/ Isaac J. Kagan     Name: Isaac J. Kagan     Title:   Vice President

 

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EXHIBIT A

 

Name and Address of Initial Shareholder1  Number of
Escrow
Shares   Number of
Forfeiture
Escrow
Shares   Date of
Insider
Letter Hong Ye Hong Kong Shareholding Co., Limited.   1,330,000    180,000  
October 23, 2018 Guan Wang   960,000    130,000   October 23, 2018 Bin (Ben)
Wang   495,000    65,000   October 23, 2018 Keqing (Kevin) Liu   30,000    0  
October 23, 2018 Howard Jiang   30,000    0   October 23, 2018 John W. Allen 
 30,000    0   October 23, 2018 Harry Edelson   1,330,000    180,000   October
23, 2018

 

 

 

1 The address of each of the individuals is c/o Alberton Acquisition
Corporation, Room 1001, 10/F, Capital Center, 151 Gloucester Road, Wanchai, Hong
Kong.

 

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